CLASSIFICATION OF PROPERTY 2. Meralco v.
CBAA
1. Punsalan v. Lacsamana
Facts: Punsalan was the owner of a piece of land, which he mortgaged in
favor of PNB. Due to his failure to pay, the mortgage was foreclosed and the
land was sold in a public auction to which PNB was the highest bidder.
On a relevant date, while Punsalan was still the possessor of the
land, it secured a permit for the construction of a warehouse.
A deed of sale was executed between PNB and Punsalan. This
contract was amended to include the warehouse and the improvement
thereon. By virtue of these instruments, respondent Lacsamana secured title
over the property in her name.
Petitioner then sought for the annulment of the deed of sale. Among
his allegations was that the bank did not own the building and thus, it should
not be included in the said deed.
Petitioner’s complaint was dismissed for improper venue. The trial
court held that the action being filed in actuality by petitioner is a real action
involving his right over a real property.
Issue: WON the property in dispute is real or personal
Held: Warehouse claimed to be owned by petitioner is an immovable or real
property. Buildings are always immovable under the Code. A building treated
separately from the land on which it is stood is immovable property and the
mere fact that the parties to a contract seem to have dealt with it separate
and apart from the land on which it stood in no wise changed its character as
immovable property.
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Facts: Meralco Securities Industrial Corporation assails the decision of the
CBAA, holding that Meralco Securities’ oil pipeline is subject to realty tax.
The record reveals that pursuant to a pipeline concession issued under
the Petroleum Act of 1949, R. A. No. 387, Meralco Securities installed from
Batangas to Manila a pipeline system consisting of cylindrical steel pipes
joined together and buried not less than one meter below the surface along
the shoulder of the public highway. The portion passing through Laguna is
about thirty kilometers long.
In order to repair, replace, remove or transfer segments of the
pipeline, the pipes have to be cold-cut by means of a rotary hard-metal pipe-
cutter after digging or excavating them out of the ground where they are
buried. In points where the pipeline traversed rivers or creeks, the pipes were
laid beneath the bed thereof. Hence, the pipes are permanently attached to
the land.
However, Meralco Securities notes that segments of the pipeline can
be moved from one place to another as shown in the permit issued by the
Secretary of Public Works and Communications which permit provides that
the government reserves the right to require the removal or transfer of the
pipes by and at the concessionaire’s expense should they be affected by any
road repair or improvement.
Pursuant to the Assessment Law, Commonwealth Act No. 470, the
provincial assessor of Laguna treated the pipeline as real property and issued
Tax Declarations Nos. 6535-6537, San Pedro; 7473-7478, Cabuyao; 7967-
7971, Sta. Rosa; 9882-9885, Biñan and 15806-15810, Calamba, containing the
assessed values of portions of the pipeline.
Meralco Securities appealed the assessments to the Board of
Assessment Appeals of Laguna. That board upheld the assessments.
 Meralco Securities insists that its pipeline is not subject to realty tax The pipeline system in question is indubitably a construction adhering
because it is not real property within the meaning of article 415. This to the soil (Exh. B, p. 39, Rollo). It is attached to the land in such a way that it
contention is not sustainable under the provisions of the Assessment Law, the cannot be separated therefrom without dismantling the steel pipes which
Real Property Tax Code and the Civil Code. were welded to form the pipeline.
Insofar as the pipeline uses valves, pumps and control devices to
Issue: Whether or not the pipeline of Meralco fall within any of the classes of maintain the flow of oil, it is in a sense machinery within the meaning of the
exempt real property enumerated in section 3 of the Assessment Law and Real Property Tax Code.
section 40 of the Real Property Tax Code. It should be borne in mind that what are being characterized as real
property are not the steel pipes but the pipeline system as a whole. Meralco
Held: Section 2 of the Assessment Law provides that the realty tax is due “on Securities has apparently two pipeline systems.
real property, including land, buildings, machinery, and other improvements” Meralco Securities argues that the realty tax is a local tax or levy and
not specifically exempted in section 3 thereof. This provision is reproduced not a tax of general application. This argument is untenable because the
with some modification in the Real Property Tax Code which provides: realty tax has always been imposed by the lawmaking body and later by the
“SEC.38. Incidence of Real Property Tax.— There shall be levied, assessed and President of the Philippines in the exercise of his lawmaking powers.
collected in all provinces, cities and municipalities an annual ad valorem tax The realty tax is enforced throughout the Philippines and not merely
on real property, such as land, buildings, machinery and other improvements in a particular municipality or city but the proceeds of the tax accrue to the
affixed or attached to real property not hereinafter specifically exempted.” province, city, municipality and barrio where the realty taxed is situated (Sec.
It is incontestable that the pipeline of Meralco Securities does not fall 86, P.D. No. 464). In contrast, a local tax is imposed by the municipal or city
within any of the classes of exempt real property enumerated in section 3 of council by virtue of the Local Tax Code, Presidential Decree No. 231, which
the Assessment Law and section 40 of the Real Property Tax Code. took effect on July 1, 1973 (69 O.G. 6197).
Pipeline means a line of pipe connected to pumps, valves and control The Court held that the CBAA did not act with grave abuse of
devices for conveying liquids, gases or finely divided solids. It is a line of pipe discretion, did not commit any error of law and acted within its jurisdiction in
running upon or in the earth, carrying with it the right to the use of the soil in sustaining the holding of the provincial assessor and the local board of
which it is placed (Note 21[10],54 C.J.S. 561). assessment appeals that Meralco Securities’ pipeline system in Laguna is
Article 415[l] and [3] provides that real property may consist of subject to realty tax.
constructions of all kinds adhered to the soil and everything attached to an
immovable in a fixed manner, in such a way that it cannot be separated
therefrom without breaking the material or deterioration of the object.

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3. Manila Electric Company v. City Assessor
Facts: On February 20, 1989, MERALCO received from the City Assessor of
Lucena a copy of Tax Declaration No. 019-6500... these electric facilities had a
market value of P81,811,000.00 and an assessed value of P65,448,800.00,
and were subjected... to real property tax as of 1985.
MERALCO appealed claming that MERALCO was exempted from
payment of real property tax on said substation facilities.
The LBAA rendered a Decision... the Board overrules the claim of the
[City Assessor of Lucena] and sustain the claim of [MERALCO].
Six years later, on October 29, 1997, MERALCO received a letter19
dated October 16, 1997 from the City Treasurer of Lucena, which stated that
the company was being assessed real property tax delinquency on its
machineries beginning 1990
MERALCO appealed Tax Declaration MERALCO asked the LBAA to
cancel... and nullify the Notice of Assessment dated October 20, 1997 and
declare the properties covered by Tax Declaration Nos. 019-6500 and 019-
7394 exempt from real property tax.
MERALCO's appeal be dismissed for lack of merit
Disgruntled, MERALCO sought recourse from the Court of Appeals
The Court of Appeals rendered a Decision on May 13, 2004 rejecting
all arguments proffered by MERALCO.
MERALCO similarly failed to persuade the Court of Appeals that the
transformers, transmission lines, insulators, and electric meters mounted on
the electric posts of MERALCO were not real properties.
Court of Appeals denied the Motion for Reconsideration of MERALCO
MERALCO is presently before the Court via the instant Petition for
Review on Certiorari
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Issue: whether or not the poles, wires, insulators, transformers, and electric
meters of MERALCO were real properties
Held: The Court finds that the transformers, electric posts, transmission lines,
insulators, and electric meters of MERALCO are no longer exempted from real
property tax and may qualify as "machinery" subject to real property tax
under the Local Government Code.
Through the years, the relevant laws have consistently considered
"machinery" as real property subject to real property tax.
Granting for the purpose of argument that the steel supports or
towers in question are not embraced within the term poles, the logical
question posited is whether they constitute real properties, so that they can
be subject to a real property tax. The tax law... does not provide for a
definition of real property; but Article 415 of the Civil Code does, by stating
the following are immovable property:
(1) Land, buildings, roads, and constructions of all kinds adhered to the soil;...
x x x x (3) Everything attached to an immovable in a fixed manner, in such a
way that it cannot be separated therefrom without breaking the material or
deterioration of the object;... x x x x (5) Machinery, receptacles, instruments
or implements intended by the owner of the tenement for an industry or
works which may be carried in a building or on a piece of land, and which
tends directly to meet the needs of the said industry or works;... x x x x
The steel towers or supports in question, do not come within the
objects mentioned in paragraph 1, because they do not constitute buildings
or constructions adhered to the soil.
They can not be included under paragraph 3, as they are not attached
to an immovable in a fixed... manner, and they can be separated without
breaking the material or causing deterioration upon the object to which they
are attached.
 These steel towers or supports do not also fall under paragraph 5, for
they are not machineries or receptacles, instruments or implements, and
even if they were, they are not intended for industry or works on the land.
The aforequoted conclusions of the Court in the 1964 MERALCO case
do not hold true anymore under the Local Government Code.
While the Local Government Code still does not provide for a specific
definition of "real property," Sections 199(o) and 232 of the said Code,
respectively, gives an extensive definition of what constitutes "machinery"
and unequivocally subjects such machinery to real property tax
As between the Civil Code, a general law governing property and
property relations, and the Local Government Code, a special law granting
local government units the power to impose real property tax, then the latter
shall prevail.
In Caltex (Philippines), Inc. v. Central Board of Assessment Appeals,
[62] the Court acknowledged that "[i]t is a familiar phenomenon to see things
classed as real property for purposes of taxation which on general principle
might be... considered personal property[.]"
Therefore, for determining whether machinery is real property subject to real
property tax, the definition and requirements under the Local Government
Code are controlling.
Principles: under Section 199(o) of the Local Government Code, machinery,
to be deemed real property subject to real property tax, need no longer be
annexed to the land or building as these "may or may not be attached,
permanently or temporarily to the real... property," and in fact, such
machinery may even be "mobile."[55] The same provision though requires
that to be machinery subject to real property tax, the physical facilities for
production, installations, and appurtenant service facilities, those which are...
mobile, self-powered or self-propelled, or not permanently attached to the
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real property (a) must be actually, directly, and exclusively used to meet the
needs of the particular industry, business, or activity; and (2) by their very
nature and purpose, are designed for, or... necessary for manufacturing,
mining, logging, commercial, industrial, or agricultural purposes.
Article 415 of the Civil Code... the following are immovable property:
(1) Land, buildings, roads, and constructions of all kinds adhered to the soil;
3) Everything attached to an immovable in a fixed manner, in such a way that
it cannot be separated therefrom without breaking the material or
deterioration of the object;... x x x x(5) Machinery, receptacles, instruments
or implements intended by the owner of the tenement for an industry or
works which may be carried in a building or on a piece of land, and which
tends directly to meet the needs of the said industry or works;... x x x x
4. Davao Saw Mill v. Castillo
Facts: The Davao Saw Mill Co., Inc., operates a sawmill. However, the land
upon which the business was conducted belonged to another person. On the
land the sawmill company erected a building which housed the machinery
used by it. Some of the machines were placed and mounted on foundations
of cement. In the contract of lease between the sawmill company and the
owner of the land there appeared the following provision:
That on the expiration of the period agreed upon, all the
improvements and buildings introduced and erected by the lessee shall pass
to the exclusive ownership of the lessor without any obligation on its part to
pay any amount for said improvements and buildings; also, in the event the
lessee should leave or abandon the land leased before the time herein
stipulated, the improvements and buildings shall likewise pass to the
ownership of the lessor as though the time agreed upon had expired:
Provided, however, That the machineries and accessories are not included in
the improvements which will pass to the lessor on the expiration or
abandonment of the land leased.
In another action, wherein Davao Saw Mill was the defendant, a
judgment was rendered in favor of the plaintiff in that action against the
defendant in that action; a writ of execution issued thereon, and the
properties now in question were levied upon as personalty by the sheriff.
Davao Saw Mill has on a number of occasions treated the machinery as
personal property by executing chattel mortgages in favor of third persons.
One of such persons is the appellee by assignment from the original
mortgages.
Issue: Whether or not the machinery in dispute is a personal property.
Held: Article 334, paragraphs 1 and 5, of the Civil Code, is in point. According
to the Code, real property consists of —
“1. Land, buildings, roads and constructions of all kinds adhering to
the soil; xxx 5. Machinery, liquid containers, instruments or implements
intended by the owner of any building or land for use in connection with any
industry or trade being carried on therein and which are expressly adapted to
meet the requirements of such trade of industry.”
Appellant emphasizes the first paragraph, and appellees the last
mentioned paragraph.
While not conclusive, the characterization of the property as chattels
by the appellant is indicative of intention and impresses upon the property
the character determined by the parties.
It is machinery which is involved; moreover, machinery not intended
by the owner of any building or land for use in connection therewith, but
intended by a lessee for use in a building erected on the land by the latter to
be returned to the lessee on the expiration or abandonment of the lease.
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Machinery which is movable in its nature only becomes immobilized
when placed in a plant by the owner of the property or plant, but not when
so placed by a tenant, a usufructuary, or any person having only a temporary
right, unless such person acted as the agent of the owner.
“Machinery, vessels, instruments or implements intended by the
owner of the tenements for the industrial or works that they may carry on in
any building or upon any land and which tend directly to meet the needs of
the said industry or works.”
Machinery which is movable in its nature only becomes immobilized
when placed in a plant by the owner of the property or plant. Such result
would not be accomplished, therefore, by the placing of machinery in a plant
by a tenant or a usufructuary or any person having only a temporary right.
5. Sibal v. Valdez
Doctrine: A crop raised on leased premises belongs to the lessee and in no
sense forms part of the immovable.
“Ungathered products” have the nature of personal property. In other
words, the phrase “personal property” should be understood to include
“ungathered products.” Crops, whether growing or standing in the field ready
to be harvested, are, when produced by annual cultivation, no part of the
realty.
Facts: Sibal alleged that Mamawal, deputy sheriff of Tarlac attached and sold
to Valdez the sugar cane planted by Sibal on several parcels of land. Valdez
refused to returned the cane and money to Sibal. As 2nd cause of action,
Sibal alleged that Valdez was attempting to harvest the palay planted in four
of the seven parcels of land mentioned. The court after hearing both parties,
issued the writ of preliminary injunction prayed for in the complaint.
 The defendant Emiliano J. Valdez, in his amended answer, denied
generally and specifically each and every allegation of the complaint and step
up the following defenses:
(a) That the sugar cane in question had the nature of personal property and
was not, therefore, subject to redemption;
(b) That he was the owner of parcels 1, 2 and 7 described in the first cause of
action of the complaint;
(c) That he was the owner of the palay in parcels 1, 2 and 7; and
(d) That he never attempted to harvest the palay in parcels 4 and 5. After
hearing the evidence, Judge Lukban rendered in favor of the defendants.
Issue: Whether the sugar cane is personal or real property?
Held: It is contended that sugar cane comes under the classification of real
property as "ungathered products" in paragraph 2 of article 334 of the Civil
Code. Said paragraph 2 of article 334 enumerates as real property the
following: Trees, plants, and ungathered products, while they are annexed to
the land or form an integral part of any immovable property." That article,
however, has received in recent years an interpretation by the Tribunal
Supremo de España, which holds that, under certain conditions, growing
crops may be considered as personal property.
In some cases "standing crops" may be considered and dealt with as
personal property. In the case of Lumber Co. vs. Sheriff and Tax Collector (106
La., 418) the Supreme Court said: "True, by article 465 of the Civil Code it is
provided that 'standing crops and the fruits of trees not gathered and trees
before they are cut down . . . are considered as part of the land to which they
are attached, but the immovability provided for is only one in abstracto and
without reference to rights on or to the crop acquired by others than the
owners of the property to which the crop is attached. . . . The existence of a
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right on the growing crop is a mobilization by anticipation, a gathering as it
were in advance, rendering the crop movable quoad the right acquired
therein. Our jurisprudence recognizes the possible mobilization of the
growing crop."
For the purpose of attachment and execution, and for the purposes of
the Chattel Mortgage Law, "ungathered products" have the nature of
personal property. SC lowered the award for damages to the defendant to
8,900.80 by acknowledging the fact that some of the sugar canes were
owned by the petitioner and by reducing the calculated expected yield or
profit that defendant would have made if petitioner did not judicially prevent
him from planting and harvesting his lands.
6. Serg’s Products v. PCI Leasing and Finance
Facts: Respondent PCI Leasing and Finance, Inc, filed with the RTC-QC a
complaint for a sum of money with an application for a writ of replevin.
Respondent Judge issued a writ of replevin directing its sheriff to seize and
deliver the machineries and equipment to PCI after 5 days and upon the
payment of the necessary expenses.
In the implementation of the said writ, the sheriff proceeded to
petitioner’s factory, seized one machinery with word that he would return for
the other.
Petitioners filed a motion for special protective order, invoking the
power of the court to control the conduct of its officers and amend and
control its processes, praying for a directive for the sheriff to defer
enforcement of the writ of replevin.
The motion was opposed by PCI Leasing, on the ground that the
properties were still personal and therefore still subject to seizure and a writ
of replevin.
 The sheriff again sought to enforce the writ of seizure and take Agreement-is good only insofar as the contracting parties are concerned.
possession of the remaining properties. He was able to take two more, but Hence, while the parties are bound by the Agreement, third persons acting in
was prevented by the workers from taking the rest. good faith are not affected by its stipulation characterizing the subject
machinery as personal. In any event, there is no showing that any specific
Issue: 1. Whether or not the machineries purchased and imported by Serg’s third party would be adversely affected.
became real property by virtue of immobilization. 2. Yes.It should be pointed out that the Court may rely on the Lease
2. Whether or not the contract between the parties is valid. Agreement, for nothing on the record shows that it has been nullified or
annulled. In fact, petitioners assailed it first only in the RTC proceedings,
Held: The petition is not meritorious. which had ironically been instituted by respondent. Accordingly, it must be
1. No.The machines that were subjects of the Writ of seizure were placed by presumed valid and binding as the law between the parties.
petitioners in the factory built on their own land. Indisputably, they were
essential and principal elements of their chocolate-making industry. Hence, Note: Article 415. The following are immovable property: (5) Machinery,
although each of them was movable or personal property on its own, all of receptacles, instruments or implements intended by the owner of the
them have become immobilized by destination because they are essential tenement for an industry or works which may be carried on in a building or
and principal elements in the industry. In that sense petitioners are correct in on a piece of land, and which tend directly to meet the needs of the said
arguing that the said machines are real property pursuant to Article 415 (5) of industry or works.
the Civil Code.
But the Court disagrees with the submission of the petitioners that 7. Manila Lodge No. 761 v. Court of Appeals
the said machines are not proper subject of the Writ of Seizure.
The Court has held that contracting parties may validly stipulate that a Facts: The Philippine Commission enacted Act No. 1306 which authorized
real property be considered as personal. After agreeing to such stipulation, the City of Manila to reclaim a portion of Manila Bay. The reclaimed area
they are consequently stopped from claiming otherwise. Under the principle was to form part of the Luneta extension. The act provided that the
of estoppels, a party to a contract is ordinarily precluded from denying the reclaimed area shall be the property of the City of Manila, and the city is
truth of any material fact found therein. authorized to set aside a tract of the reclaimed land for a hotel site and to
Clearly then, petitioners are stopped from denying the lease or to sell the same. Later, the City of Manila conveyed a portion of the
characterization of the subject machines as personal property. Under reclaimed area to Petitioner. Then Petitioner sold the land, together with all
circumstances, they are proper subjects of the Writ of Seizure. the improvements, to the Tarlac Development Corporation (TDC).
It should be stressed, however, that the Court’s holding-that the
machines should be deemed personal property pursuant to the Lease Issue: Whether or not the subject property was patrimonial property of the

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City of Manila
Held: The petitions were denied for lack of merit. The court found it
necessary to analyze all the provisions of Act No. 1360, as amended, in order
to unravel the legislative intent. The grant made by Act No. 1360 of the
reclaimed land to the City of Manila is a grant of a “public” nature. Such
grants have always been strictly construed against the grantee because it is a
gratuitous donation of public money or resources, which resulted in an unfair
advantage to the grantee. In the case at bar, the area reclaimed would be
filled at the expense of the Insular Government and without cost to the City
of Manila. Hence, the letter of the statute should be narrowed to exclude
matters which, if included, would defeat the policy of legislation
President Corazon Aquino on the other hand amended the
proclamation of Pres. Marcos and limited the lots which were open for
disposition.
On March of 1992, the Bases conversion and Development Authority
(BCDA) was created to oversee and accelerate the conversion of Clark and
Military Reservations to productive civilian uses, which then authorized the
President of the Philippines to sell the lands covered in whole or in part,
specifically to raise capital for the BCDA. BCDA asserted its title to Dream
Village owing to the fact that BCDA’s titles over Fort Bonifacio are valid and
commercially valuable to the agency, however, due to the passage of time,
was contended to have been abandoned to Dream Village, and that BCDA’s
right over it has already prescribed.

8. Dream Village Neighborhood Association v. Bases Development Authority Issue: Whether the area occupied by Dream Village is susceptible of
acquisition by prescription
Facts: Dream Village, composed of more than 2,000 families have been
occupying the disputed lot continuously, exclusively and notoriously since the Held: No. Property of the State or any of its subdivisions not patrimonial in
year 1985. Said lot used to be a part of the Hacienda de Maricaban, which character shall not be the object of prescription (Art.1113, NCC). Also, under
was subsequently purchased by the government of the United States of Article 422 of the Civil Code, public domain lands become patrimonial
America (USA) and was converted to Fort William McKinley. Later on, USA property only if there is a declaration that these are alienable or disposable,
transferred 30 hectares of it to the Manila Railroad Company, while the rest together with an express government manifestation that the property is
were still in the name of US Government. already patrimonial or no longer retained for public service or the
Finally, on December of 1956, the US government ceded Fort William development of national wealth. Only when the property has become
McKinley to the Republic of the Philippines (RP) and was renamed Fort patrimonial can the prescriptive period for the acquisition of property of the
Bonifacio, reserved for military purposes. public dominion begin to run. It is also stipulated under PD 1529 that before
On January 1986, President Marcos Issued Proclamation No. 2476 the acquisitive prescription can commence, the property must expressly
declaring certain portions of Fort Bonifacio alienable and disposable, thus declared by the State that it is no longer intended for public service or the
allowing sale to the settlers of home lots in Upper Bicutan, Lower Bicutan, development of national wealth, and that absent such express declaration,
Signal Village, and Western Bicutan. the land remains to be property of public dominion. Subsequent

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proclamations over vast portions of Maricaban exempted the lot where
Dream Village was situated from being open for disposition, thus Fort
Bonifacio remains a property of public Dominion of the State because
although declared alienable and disposable, it is reserved for some public
service or development of national wealth, and thus, the acquisitive
prescription asserted by Dream Village has not even begun to run. Thus, the
area occupied by Dream Village is still not susceptible of acquisition by
prescription.
9. Republic of the Philippines v. Cortez
Facts: Respondent Emmanuel C. Cortez (Cortez) filed with the RTC an
applicationfor judicial confirmation of title over a parcel of land located at
Barangay (Poblacion) Aguho, P. Herrera Street, Pateros, Metro Manila. In
support of his application, Cortez submitted, inter alia, the following
documents: (1) tax declarations for various years from 1966 until 2005; (2)
survey plan of the property, with the annotation that the property is classified
as alienable and disposable; (3) technical description of the property, with a
certification issued by a geodetic engineer; (4) tax clearance certificate; (5)
extrajudicial settlement of estate conveying the subject property to Cortez;
and (6) escritura de particion extrajudicial dated July 19, 1946, allocating the
subject property to Felicisima Cotas Cortez mother.
As there was no opposition, the RTC issued an Order of General
Default and Cortez was allowed to present his evidence ex-parte.
Cortez claimed that the subject parcel of land is a portion of Lot No.
2697, which was declared for taxation purposes in the name of his mother.
He alleged that Lot No. 2697 was inherited by his mother from her parents in
1946; that, after his parents died, he and his siblings executed an Extra-
Judicial Settlement of Estate over the properties of their deceased parents Issue: Did the CA err in affirming the grant of the application for registration?
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and one of the properties allocated to him was the subject property. He
alleged that the subject property had been in the possession of his family
since time immemorial; that the subject parcel of land is not part of the
reservation of the Department of Environment and Natural Resources (DENR)
and is, in fact, classified as alienable and disposable by the Bureau of Forest
Development (BFD).
Ernesto Santos, who testified that he has known the family of Cortez
for over sixty (60) years and that Cortez and his predecessors-in-interest have
been in possession of the subject property since he came to know them.
The RTC granted Cortez application for registration, however, The
Republic of the Philippines (petitioner), represented by the Office of the
Solicitor General, appealed to the CA, alleging that the RTC erred in granting
the application for registration despite the failure of Cortez to comply with
the requirements for original registration of title. The petitioner pointed out
that, although Cortez declared that he and his predecessors-in-interest were
in possession of the subject parcel of land since time immemorial, no
document was ever presented that would establish his predecessors-in-
interests possession of the same during the period required by law. That
petitioner claimed that Cortez assertion that he and his predecessors-in-
interest had been in open, adverse, and continuous possession of the subject
property for more than thirty (30) years does not constitute well-neigh
incontrovertible evidence required in land registration cases; that it is a mere
claim, which should not have been given weight by the RTC.
The CA found that Cortez and his predecessors-in-interest had been in
open, continuous, and exclusive possession of the subject property for more
than 30 years, which, under Section 14(2) of Presidential Decree (P.D.) No.
1529, sufficed to convert it to private property. Hence, the instant petition.

Held: The Court finds that Cortez failed to comply with the legal requirements
for the registration of the subject property under Section 14(1) and (2) of P.D.
No. 1529.
Section 14(1) of P.D. No. 1529 refers to the judicial confirmation of
imperfect or incomplete titles to public land acquired under Section 48(b) of
C.A. No. 141, as amended by P.D. No. 1073. "Under Section 14(1) [of P.D. No.
1529], applicants for registration of title must sufficiently establish first, that
the subject land forms part of the disposable and alienable lands of the
public domain; second, that the applicant and his predecessors-in-interest
have been in open, continuous, exclusive, and notorious possession and
occupation of the same; and third, that it is under a bona fide claim of
ownership since June 12, 1945, or earlier."
In the case at bar, while the Advance Plan bearing the notation was
certified by the Lands Management Services of the DENR, the certification
refers only to the technical correctness of the survey plotted in the said plan
and has nothing to do whatsoever with the nature and character of the
property surveyed.
Respondents failed to submit a certification from the proper
government agency to prove that the lands subject for registration are indeed
alienable and disposable.
Section 14(2) of P.D. No. 1529 sanctions the original registration of
lands acquired by prescription under the provisions of existing laws. "As
Section 14(2) [of P.D. No. 1529] categorically provides, only private properties
may be acquired thru prescription and under Articles 420 and 421 of the Civil
Code, only those properties, which are not for public use, public service or
intended for the development of national wealth, are considered private."
The Civil Code makes it clear that patrimonial property of the State
may be acquired by private persons through prescription. This is brought
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about by Article 1113, which states that "all things which are within the
commerce of man are susceptible to prescription," and that property of the
State or any of its subdivisions not patrimonial in character shall not be the
object of prescription."
The Court further stressed that the period of acquisitive prescription
would only begin to run from the time that the State officially declares that
the public dominion property is no longer intended for public use, public
service, or for the development of national wealth.
Accordingly, although lands of the public domain that are considered
patrimonial may be acquired by prescription under Section 14(2) of P.D. No.
1529, before acquisitive prescription could commence, the property sought
to be registered must not only be classified as alienable and disposable; it
must also be declared by the State that it is no longer intended for public use,
public service or the development of the national wealth. Thus, absent an
express declaration by the State, the land remains to be property of public
dominion.
The Court finds no evidence of any official declaration from the state
attesting to the patrimonial character of the subject property. Cortez failed to
prove that acquisitive prescription has begun to run against the State, much
less that he has acquired title to the subject property by virtue thereof. It is of
no moment that Cortez and his predecessors-in-interest have been in
possession of the subject property for 57 years at the time he applied for the
registration of title thereto. lt is not the notorious, exclusive and
uninterrupted possession and occupation of an alienable and disposable
public land for the mandated periods that converts it to patrimonial.