G.R. No.

L-46245 May 31, 1982

MERALCO SECURITIES INDUSTRIAL CORPORATION, petitioner,

vs.

CENTRAL BOARD OF ASSESSMENT APPEALS, BOARD OF

ASSESSMENT APPEALS OF LAGUNA and PROVINCIAL ASSESSOR OF
LAGUNA, respondents.
Facts:
Pursuant to a pipeline concession issued under the Petroleum Act of 1949,
Republic Act 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 pipes are embedded in the soil and are firmly and solidly welded
together so as to preclude breakage or damage thereto and prevent leakage
or seepage of the oil. The valves are welded to the pipes so as to make the
pipeline system one single piece of property from end to end.

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.

Pursuant to the Assessment Law, Commonwealth Act No. 470, the provincial
assessor of Laguna treated the pipeline as real property and issued tax
declarations, containing the assessed values of portions of the pipeline.

Meralco appealed the assessments to the defendants, but the latter ruled that
pipeline is subject to realty tax. The defendants argued that the pipeline is
subject to realty tax because they are contemplated in Assessment Law and
Real Property Tax Code; that they do not fall within the category of property
exempt from realty tax under those laws; that Articles 415 & 416 of the Civil
Code, defining real and personal property have no applications to this case
because these pipes are constructions adhered to soil and things attached to
the land in a fixed manner, and that Meralco Securities is not exempt from
realty tax under petroleum law.

Meralco insists that its pipeline is not subject to realty tax because it is not real
property within the meaning of Art. 415.
Issue:
Whether the aforementioned pipelines are subject to realty tax.
Held:
Yes, the pipelines are subject to realty tax.
Section 2 of the Assessment Law provides that the realty tax is due “on real
property, including land, buildings, machinery, and other improvements.” This
provision is reproduced with some modification in Section 38, Real Property
Tax Code, which provides that “there shall be levied, assessed, and collected
xxx annual ad valorem tax on real property such as land, buildings,
machinery, and other improvements affixed or attached to real property xxx.”

It is incontestable that the pipeline of Meralco Securities does not fall within
any of the classes of exempt real property enumerated in section 3 of the
Assessment Law and section 40 of the Real Property Tax Code.

Pipeline means a line of pipe connected to pumps, valves and control devices
for conveying liquids, gases or finely divided solids. It is a line of pipe running
upon or in the earth, carrying with it the right to the use of the soil in which it is
placed.

Article 415[l] and [3] provides that real property may consist of 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.

The pipeline system in question is indubitably a construction adhering to the

soil. It is attached to the land in such a way that it cannot be separated
therefrom without dismantling the steel pipes which were welded to form the
pipeline.

WHEREFORE, the questioned decision and resolution are affirmed. The petition is
dismissed. No costs.
Benguet Corp vs CBAA

FACTS:
On 1985, Provincial Assessor of Zambales assessed the said properties in issue as
taxablei m p r o v e m e n t s . T h e a s s e s s m e n t w a s a p p e a l e d t o t h e B o a r d o f
Assessment
Appeals of theP r o v i n c e o f Z a m b a l e s . H o w e v e r , t h e a p p e a l w a s
d i s m i s s e d m a i n l y o n t h e g r o u n d o f t h e petitioner's failure to pay the
realty taxes that fell due during the pendency of the appeal.The petitioner elevated the
matter to the Central Board of Assessment Appeals, one of theherein respondents. In
its decision dated March 22, 1990, the Board reversed the dismissal of theappeal but,
agreed that the tailings dam and the lands submerged thereund er shall be
subject torealty tax.For purposes of taxation the dam is considered as real
property as it comes within theobject mentioned in Article 415 of the New
Civil Code, It is a construction adhered to the soilwhich cannot be separated
or detached without breaking the material or causing destruction onthe land
upon which it is attached. The immovable nature of the dam as an
improvement whichdetermines its character as real property, hence taxable under
Section 38 of the Real Property Tax Code

Issue:
Whether or not the tailings dam is subject to realty tax?
Whether or not it be considered as immovable property?
Held:

Yes, it is subject to realty tax and it is considered an immovable property.The petitioner

does not dispute that the tailings dam may be considered realty within themeaning of
Article 415. It insists, however, that the dam cannot be subjected to realty
tax as aseparate and independent property because it does not constitute an
"assessable improvement" onthe mine although a considerable sum may have been
spent in constructing and maintaining it.The Real Property Tax Code does not
carry a definition of "real property" and simplysays that the realty tax is
imposed on "real property, such as lands, buildings, machinery an. Even without
the tailings dam, the petitioner's mining operation can still be carried out because the primary
function of the dam is merely to receive and retain the wastes and water coming from the mine.
There is no allegation that the water coming from the dam is the sole source of water for the mining
operation so as to make the dam an integral part of the mine. In fact, as a result of the construction
of the dam, the petitioner can now impound and recycle water without having to spend for the
building of a water reservoir. And as the petitioner itself points out, even if the petitioner's mine is
shut down or ceases operation, the dam may still be used for irrigation of the surrounding areas,
again unlike in the Ontario case.

By contrast, the tailings dam in question is being used exclusively for the benefit of the petitioner.
The Court is convinced that the subject dam falls within the definition of an "improvement" because it
is permanent in character and it enhances both the value and utility of petitioner's mine. Moreover,
the immovable nature of the dam defines its character as real property under Article 415 of the Civil
Code and thus makes it taxable under Section 38 of the Real Property Tax Code.

WHEREFORE, the petition is DISMISSED for failure to show that the questioned decision of
respondent Central Board of Assessment Appeals is tainted with grave abuse of discretion
except as to the imposition of penalties upon the petitioner which is hereby SET ASIDE
G.R. No. L-50466 May 31, 1982

CALTEX (PHILIPPINES) INC., petitioner,

vs.
CENTRAL BOARD OF ASSESSMENT APPEALS and CITY ASSESSOR OF PASAY, respondents.

AQUINO, J.:

FACTS: This case is about the realty tax on machinery and equipment installed by Caltex
(Philippines) Inc. in its gas stations located on leased land. The machines and equipment
consists of underground tanks, elevated tank, elevated water tanks, water tanks, gasoline
pumps, computing pumps, water pumps, car washer, car hoists, truck hoists, air compressors
and tireflators.

The said machines and equipment are loaned by Caltex to gas station operators under an
appropriate lease agreement or receipt. It is stipulated in the lease contract that the operators,
upon demand, shall return to Caltex the machines and equipment in good condition as when
received, ordinary wear and tear excepted. Caltex retains the ownership thereof during the
term of the lease.

The city assessor of Pasay City characterized the said items of gas station equipment and
machinery as taxable realty. The realty tax on said equipment amounts to P4,541.10 annually
(p. 52, Rollo). The city board of tax appeals ruled that they are personalty. The assessor
appealed to the Central Board of Assessment Appeals.

The Board held that the said machines and equipment are real property within the meaning of
sections 3(k) & (m) and 38 of the Real Property Tax Code, Presidential Decree No. 464, which
took effect on June 1, 1974, and that the definitions of real property and personal property in
articles 415 and 416 of the Civil Code are not applicable to this case and was reiterated by the
Board in its resolution of January 12, 1978, denying Caltex's motion for reconsideration, a copy
of which was received by its lawyer on April 2, 1979.

On May 2, 1979 Caltex filed this certiorari petition wherein it prayed for the setting aside of the
Board's decision and for a declaration that the said machines and equipment are personal
property not subject to realty tax.

The Solicitor General's contention that the Court of Tax Appeals has exclusive appellate jurisdiction over this case
is not correct. When Republic act No. 1125 created the Tax Court in 1954, there was as yet no Central Board of
Assessment Appeals. Section 7(3) of that law in providing that the Tax Court had jurisdiction to review by appeal
decisions of provincial or city boards of assessment appeals had in mind the local boards of assessment appeals
but not the Central Board of Assessment Appeals which under the Real Property Tax Code has appellate
jurisdiction over decisions of the said local boards of assessment appeals and is, therefore, in the same category as
the Tax Court.

Section 36 of the Real Property Tax Code provides that the decision of the Central Board of Assessment Appeals
shall become final and executory after the lapse of fifteen days from the receipt of its decision by the appellant.
Within that fifteen-day period, a petition for reconsideration may be filed. The Code does not provide for the
review of the Board's decision by this Court. Consequently, the only remedy available for seeking a review by this
Court of the decision of the Central Board of Assessment Appeals is the special civil action of certiorari, the
recourse resorted to herein by Caltex (Philippines), Inc. [PROCEDURAL LANG TO, JUST IN CASE]

ISSUE: Whether the pieces of gas station equipment and machinery already enumerated are
subject to realty tax.

HELD: This issue has to be resolved primarily under the provisions of the Assessment Law and
the Real Property Tax Code.

Section 2 of the Assessment Law provides that the realty tax is due "on real property, including
land, buildings, machinery, and other improvements" not specifically exempted in section 3
thereof. This provision is reproduced with some modification in the Real Property Tax Code
which provides:

SEC. 38. Incidence of Real Property Tax.— There shall be levied, assessed and collected in all
provinces, cities and municipalities an annual ad valorem tax on real property, such as land,
buildings, machinery and other improvements affixed or attached to real property not
hereinafter specifically exempted.

The Code contains the following definitions in its section 3:

k) Improvements — is a valuable addition made to property or an amelioration in its condition,

amounting to more than mere repairs or replacement of waste, costing labor or capital and
intended to enhance its value, beauty or utility or to adapt it for new or further purposes.

m) Machinery — shall embrace machines, mechanical contrivances, instruments, appliances and

apparatus attached to the real estate. It includes the physical facilities available for production,
as well as the installations and appurtenant service facilities, together with all other equipment
designed for or essential to its manufacturing, industrial or agricultural purposes (See sec. 3[f],
Assessment Law).

We hold that the said equipment and machinery, as appurtenances to the gas station building
or shed owned by Caltex (as to which it is subject to realty tax) and which fixtures are necessary
to the operation of the gas station, for without them the gas station would be useless, and
which have been attached or affixed permanently to the gas station site or embedded therein,
are taxable improvements and machinery within the meaning of the Assessment Law and the
Real Property Tax Code.
JG Summit Holdings INC. vs. Court of Appeals

G.R. No. 124293 January 31, 2005

(Reported by Joahna Paula Domingo)

Facts:

The National Investment and Development Corporation (NIDC), a government corporation, entered into
a Joint Venture Agreement (JVA) with Kawasaki Heavy Industries, Ltd. of Kobe, Japan (KAWASAKI) for
the construction, operation and management of the Subic National Shipyard Inc., (SNS) which
subsequently became the Philippine Shipyard and Engineering Corporation (PHILSECO).

Under the JVA, the NDC and KAWASAKI will contribute P330M for the capitalization of PHILSECO in the
proportion of 60%-40% respectively. One of its salient features is the grant to the parties of the right of
first refusal should either of them decide to sell, assign or transfer its interest in the joint venture.

NIDC transferred all its rights, title and interest in PHILSECO to the Philippine National Bank (PNB). Such
interests were subsequently transferred to the National Government pursuant to an Administrative
Order.

When the former President Aquino issued Proclamation No. 50 establishing the Committee on
Privatization (COP) and the Asset Privatization Trust (APT) to take title to, and possession of, conserve,
manage and dispose of non-performing assets of the National Government, a trust agreement was
entered into between the National Government and the APT wherein the latter was named the trustee
of the National Government’s share in PHILSECO.

In the interest of the national economy and the government, the COP and the APT deemed it best to sell
the National Government’s share in PHILSECO to private entities. After a series of negotiations between
the APT and KAWASAKI , they agreed that the latter’s right of first refusal under the JVA be “exchanged”
for the right to top by 5%, the highest bid for the said shares. They further agreed that KAWASAKI
woul.d be entitled to name a company in which it was a stockholder, which could exercise the right to
top. KAWASAKI then informed APT that Philyards Holdings, Inc. (PHI) would exercise its right to top.

At the public bidding, petitioner J.G. Summit Holdings Inc. submitted a bid of Two Billion and Thirty
Million Pesos (Php2,030,000,000.00) with an acknowledgement of KAWASAKI/PHILYARDS right to top.

As petitioner was declared the highest bidder, the COP approved the sale “subject to the right of
Kawasaki Heavy Industries, Inc. / PHILYARDS Holdings Inc. to top JG’s bid by 5% as specified in the
bidding rules.”

On the other hand, the respondent by virtue of right to top by 5%, the highest bid for the said shares
timely exercised the same.

Petitioners, in their motion for reconsideration, raised, inter alia, the issue on the maintenance of the
60%-40% relationship between the NIDC and KAWASAKI arising from the Constitution because
PHILSECO is a landholding corporation and need not be a public utility to be bound by the 60%-40%
constitutional limitation.

ISSUE:
Whether or not the respondent is prohibited to possess the disputed property considering the
prohibition stipulated in the 1987 Constitution against foreign owned companies.

RULING:

The court upheld the validity of the mutual rights of first refusal under the JVA between KAWASAKI and
NIDC.

The right of first refusal is a property right of PHILSECO shareholders, KAWASAKI and NIDC, under the
terms of their JVA. This right allows them to purchase the shares of their co-shareholder before they are
offered to a third party. The agreement of co-shareholders to mutually grant this right to each other, by
itself, does not constitute a violation of the provisions of the Constitution limiting land ownership to
Filipinos and Filipino corporations. As PHILYARDS correctly puts it, if PHILSECO still owns the land, the
right of first refusal can be validly assigned to a qualified Filipino entity in order to maintain the 60%-
40% ration. This transfer by itself, does not amount to a violation of the Anti-Dummy Laws, absent
proof of any fraudulent intent. The transfer could be made either to a nominee or such other party
which the holder of the right of first refusal feels it can comfortably do business with.

Alternatively, PHILSECO may divest of its landholdings, in which case KAWASAKI, in exercising its right of
first refusal, can exceed 40% of PHILSECO’s equity. In fact, in can even be said that if the foreign
shareholdings of a landholding corporation exeeds 40%, it is not the foreign stockholders’ ownership of
the shares which is adversely affected but the capacity of the corporation to won land—that is, the
corporation becomes disqualified to own land.

This finds support under the basic corporate law principle that the corporation and its stockholders are
separate judicial entities. In this vein, the right of first refusal over shares pertains to the shareholders
whereas the capacity to own land pertains to the corporation. Hence, the fact that PHILSECO owns land
cannot deprive stockholders of their right of first refusal. No law disqualifies a person from purchasing
shares in a landholding corporation even if the latter will exceed the allowed foreign equity, what the
law disqualifies is the corporation from owning land.
DOCTRINE: The general rule is that, only movable properties which have physical or
material existence and susceptible of occupation by another are proper objects of theft.
Only those movable properties which can be taken and carried from the place they are
found are proper subjects of theft.

G.R. No. 155076 February 27, 2006

LUIS MARCOS P. LAUREL, Petitioner, vs. HON. ZEUS C. ABROGAR, Presiding Judge
of the Regional Trial Court, Makati City, Branch 150, PEOPLE OF THE
PHILIPPINES& PHILIPPINE LONG DISTANCE TELEPHONE COMPANY, Respondents.

Facts: Baynet Co., Ltd. Is being sued for network fraud. Laurel is the board member and
corporate secretary of Baynet. 2 other filipinos and two japanese composed the board.
(Baynet) sells "Bay Super Orient Card" which uses an alternative calling patterns called
International Simple Resale (ISR). ISR is a method of routing and completing
international long distance calls using International Private Leased Lines (IPL), cables,
antenna or air wave or frequency, which connect directly to the local or domestic exchange
facilities of the terminating country (the country where the call is destined). The operator of
an ISR is able to evade payment of access, termination or bypass charges and accounting
rates, as well as compliance with the regulatory requirements of the NTC. Thus, the ISR
operator offers international telecommunication services at a lower rate, to the damage and
prejudice of legitimate operators like PLDT.

Search warrants were issued against baynet through PLDT's complaint. The seach was
followed by an inquest investigation. The prosecutor found probable cause for THEFT and
filed Information. After preliminary investigation the information was amended to include
Laurel and the other members of the board for THEFT using ISR.

Accused Laurel filed a "Motion to Quash (with Motion to Defer Arraignment)" on the
groundS that RPC does not punish use of ISR, The telephone calls belong to the person
calling not to PLDT, and that

no personal property was stolen from PLDT. There is no crime when there is no
law punishing the crime

Issue: whether or not international telephone calls using Bay Super Orient Cards through
the telecommunication services provided by PLDT for such calls, or, in short, PLDT’s
business of providing said telecommunication services, are proper subjects of theft under
Article 308 of the Revised Penal Code

Held: RTC denied MQ MR denied. Petition for Certiorari with CA, dismissed. SC,
granted.The petition is meritorious.

An information or complaint must state explicitly and directly every act or omission
constituting an offense and must allege facts establishing the conduct. the Amended
Information does not contain material allegations charging the petitioner of theft
of personal property under Article 308 of the Revised Penal Code.
The international telephone calls placed by Bay Super Orient Card holders, the
telecommunication services provided by PLDT and its business of providing said
services are not personal properties under Article 308 of the Revised Penal Code.

Article 308 of the Revised Penal Code defines theft as follows:

Art. 308. Who are liable for theft.– Theft is committed by any person who, with
intent to gain but without violence, against or intimidation of persons nor force
upon things, shall take personal property of another without the latter’s consent.

For one to be guilty of theft the accused must have an intent to steal (animus
furandi) personal property, meaning the intent to deprive another of his
ownership/lawful possession of personal property which intent is apart from and
concurrently with the general criminal intent which is an essential element of a
felony of dolo (dolus malus).

An information or complaint for simple theft must allege the following elements:

(a) the taking of personal property;

(b) the said property belongs to another;

(c) the taking be done with intent to gain; and

(d) the taking be accomplished without the use of violence or intimidation of person/s or
force upon things.

"Personal property" under the Revised Penal Code must be considered in tandem
with the word "take" in the law. The statutory definition of "taking" and movable
property indicates that, clearly, not all personal properties may be the proper subjects of
theft. The general rule is that, only movable properties which have physical or
material existence and susceptible of occupation by another are proper objects of
theft. only those movable properties which can be taken and carried from the
place they are found are proper subjects of theft.

Intangible properties such as rights and ideas are not subject of theft because the same
cannot be "taken" from the place it is found and is occupied or appropriated. movable
properties under Article 308 of the Revised Penal Code should be distinguished from the
rights or interests to which they relate. A naked right existing merely in contemplation of
law, although it may be very valuable to the person who is entitled to exercise it, is not the
subject of theft or larceny. Such rights or interests are intangible and cannot be "taken" by
another.

There is "taking" of personal property, and theft is consummated when the offender
unlawfully acquires possession of personal property even if for a short time; or if such
property is under the dominion and control of the thief. The taker, at some particular
amount, must have obtained complete and absolute possession and control of the property
adverse to the rights of the owner or the lawful possessor thereof.t is not necessary that
the property be actually carried away out of the physical possession of the lawful
possessor or that he should have made his escape with it. Neither asportation nor
actual manual possession of property is required. Constructive possession of the thief of the
property is enough. The essence of the element is the taking of a thing out of the
possession of the owner without his privity and consent and without animus
revertendi.

gas and electricity are susceptible of taking since they can be appropritated.

Business and services cannot be taken thus, not a subject of theft. They both have different
definitions.

RPC could not have included human voice or ISR in theft since such was not existing at that
time.

Respondent PLDT does not acquire possession, much less, ownership of the voices of the
telephone callers or of the electronic voice signals or current emanating from said calls. The
human voice and the electronic voice signals or current caused thereby are intangible and
not susceptible of possession, occupation or appropriation by the respondent PLDT or even
the petitioner, for that matter. PLDT merely transmits the electronic voice signals through
its facilities and equipment.

Congress did not amend the definition of theft rather they passed RA 8484 and 8792.

Republic Act No. 8484, otherwise known as the Access Devices Regulation Act of 1998, on
February 11, 1998. Under the law, an access device means any card, plate, code, account
number, electronic serial number, personal identification number and other
telecommunication services, equipment or instrumentalities-identifier or other means of
account access that can be used to obtain money, goods, services or any other thing of
value or to initiate a transfer of funds other than a transfer originated solely by paper
instrument. Among the prohibited acts enumerated in Section 9 of the law are the acts of
obtaining money or anything of value through the use of an access device, with intent to
defraud or intent to gain and fleeing thereafter; and of effecting transactions with one or
more access devices issued to another person or persons to receive payment or any other
thing of value. Under Section 11 of the law, conspiracy to commit access devices fraud is a
crime. However, the petitioner is not charged of violation of R.A. 8484.

Significantly, a prosecution under the law shall be without prejudice to any

liability for violation of any provisions of the Revised Penal Code inclusive of theft
under Rule 308 of the Revised Penal Code and estafa under Article 315 of the
Revised Penal Code. Thus, if an individual steals a credit card and uses the same to obtain
services, he is liable of the following: theft of the credit card under Article 308 of the
Revised Penal Code; violation of Republic Act No. 8484; and estafa under Article 315(2)(a)
of the Revised Penal Code with the service provider as the private complainant.

The petitioner is not charged of estafa before the RTC in the Amended Information.

Section 33 of Republic Act No. 8792, Electronic Commerce Act of 2000 provides:

Sec. 33. Penalties.— The following Acts shall be penalized by fine and/or imprisonment, as
follows:
a) Hacking or cracking which refers to unauthorized access into or interference in a
computer system/server or information and communication system; or any access in order
to corrupt, alter, steal, or destroy using a computer or other similar information and
communication devices, without the knowledge and consent of the owner of the computer
or information and communications system, including the introduction of computer viruses
and the like, resulting on the corruption, destruction, alteration, theft or loss of electronic
data messages or electronic documents shall be punished by a minimum fine of One
hundred thousand pesos (P100,000.00) and a maximum commensurate to the damage
incurred and a mandatory imprisonment of six (6) months to three (3) years.
Laurel vs Garcia
GR 92013 July 25, 1990.
Facts:

Petitioners seek to stop the Philippine Government to sell the Roppongi

Property, which is located in Japan. It is one of the properties given by the
Japanese Government as reparations for damage done by the latter to the
former during the war.

Petitioner argues that under Philippine Law, the subject property is property
of public dominion. As such, it is outside the commerce of men. Therefore, it
cannot be alienated.

Respondents aver that Japanese Law, and not Philippine Law, shall apply to
the case because the property is located in Japan. They posit that the principle
of lex situs applies.

Issues and Held:

1. WON the subject property cannot be alienated.

The answer is in the affirmative.

Under Philippine Law, there can be no doubt that it is of public dominion

unless it is convincingly shown that the property has become patrimonial.
This, the respondents have failed to do. As property of public dominion, the
Roppongi lot is outside the commerce of man. It cannot be alienated.

2. WON Philippine Law applies to the case at bar.

The answer is in the affirmative.

We see no reason why a conflict of law rule should apply when no conflict of
law situation exists. A conflict of law situation arises only when: (1) There is a
dispute over the title or ownership of an immovable, such that the capacity to
take and transfer immovables, the formalities of conveyance, the essential
validity and effect of the transfer, or the interpretation and effect of a
conveyance, are to be determined; and (2) A foreign law on land ownership
and its conveyance is asserted to conflict with a domestic law on the same
matters. Hence, the need to determine which law should apply.
In the instant case, none of the above elements exists.

The issues are not concerned with validity of ownership or title. There is no
question that the property belongs to the Philippines. The issue is the
authority of the respondent officials to validly dispose of property belonging to
the State. And the validity of the procedures adopted to effect its sale. This is
governed by Philippine Law. The rule of lex situs does not apply.

The assertion that the opinion of the Secretary of Justice sheds light on the
relevance of the lex situs rule is misplaced. The opinion does not tackle the
alienability of the real properties procured through reparations nor the
existence in what body of the authority to sell them. In discussing who are
capable of acquiring the lots, the Secretary merely explains that it is the
foreign law which should determine who can acquire the properties so that the
constitutional limitation on acquisition of lands of the public domain to
Filipino citizens and entities wholly owned by Filipinos is inapplicable.
Villarico v. Sarmiento

442 SCRA 110, 115 2004

FACTS

Teofilo C. Villarico is the owner of a lot in La Huerta, Parañaque City, Metro Manila with an area of 66
square meters and covered by Transfer Certificate of Title (T.C.T.) No. 95453 issued by the Registry of
Deeds, same city.

Villarico’s lot is separated from the Ninoy Aquino Avenue (highway) by a strip of land belonging to the
government. As this highway was elevated by 4 meters and therefore higher than the adjoining areas,
the DPWH constructed stairways at several portions of this strip of public land to enable the people to
have access to the highway.

Sometime in 1991, Vivencio Sarmiento, his daughter Bessie Sarmiento and her husband Beth Del Mundo
had a building constructed on a portion of said government land. In November that same year, a part
thereof was occupied by Andok's Litson Corporation and Marites' Carinderia.

In 1993, by means of a Deed of Exchange of Real Property, Villarico acquired a 74.30 square meter
portion of the same area owned by the government. The property was registered in his name as T.C.T.
No. 74430 in the Registry of Deeds of Parañaque City.

In 1995, Villarico filed with the RTC a complaint for accion publiciana against respondents. He alleged
inter alia that respondents' structures on the government land closed his "right of way" to the Ninoy
Aquino Avenue; and encroached on a portion of his lot covered by T.C.T. No. 74430.

ISSUE

Whether or not Villarico has a right of way to the NAA

HELD

It is not disputed that the lot on which petitioner's alleged "right of way" exists belongs to the state or
property of public dominion. Property of public dominion is defined by Article 420 of the Civil Code as
follows:

"ART. 420. The following things are property of public dominion:

(1) Those intended for public use such as roads, canals, rivers, torrents, ports and bridges constructed by
the State, banks, shores, roadsteads, and other of similar character.

(2) Those which belong to the State, without being for public use, and are intended for some public
service or for the development of the national wealth."

Public use is "use that is not confined to privileged individuals, but is open to the indefinite public."6
Records show that the lot on which the stairways were built is for the use of the people as passageway
to the highway. Consequently, it is a property of public dominion.

Property of public dominion is outside the commerce of man and hence it: (1) cannot be alienated or
leased or otherwise be the subject matter of contracts; (2) cannot be acquired by prescription against
the State; (3) is not subject to attachment and execution; and (4) cannot be burdened by any voluntary
easement.

Considering that the lot on which the stairways were constructed is a property of public dominion, it can
not be burdened by a voluntary easement of right of way in favor of Villarico. In fact, its use by the
public is by mere tolerance of the government through the DPWH. Villarico cannot appropriate it for
himself. Verily, he can not claim any right of possession over it. This is clear from Article 530 of the Civil
Code which provides:

"ART. 530. Only things and rights which are susceptible of being appropriated may be the object of
possession."
CITY OF LAPU-LAPU v. PHILIPPINE ECONOMIC ZONE AUTHORITY, GR No. 184203,
2014-11-26
Facts:
The Philippine Economic Zone Authority is exempt from payment of real property taxes.
These are consolidated... the City of Lapu-Lapu (the City)... appealed the Regional Trial
Court
's decision finding the PEZA exempt from payment of real property taxes.
the Province of Bataan (the Province)... assails the Court of Appeals' decision... granting
the PEZA's petition for certiorari. The Court of Appeals... ruled that the Regional Trial
Court,... gravely abused its discretion in finding the PEZA liable for real property taxes to the
Province of Bataan.
President Ferdinand E. Marcos issued Presidential Decree No. 66 in 1972... the Export
Processing Zone Authority (EPZA) was created to operate, administer, and manage the
export processing zones established in the Port of Mariveles, Bataan... and such other
export processing zones that may be created by... virtue of the decree.
EPZA was declared exempt from all taxes that... may be due to the Republic of the
Philippines, its provinces, cities, municipalities, and other government agencies and
instrumentalities.
Specifically, Section 21 of Presidential Decree No. 66 declared the EPZA exempt from
payment of real... property taxes
From all income taxes, franchise taxes, realty taxes and all other kinds of taxes and
licenses to be paid to the National Government, its provinces, cities, municipalities and
other government agencies and instrumentalities... the PEZA was created by virtue of
Republic Act No. 7916 or "the Special Economic Zone Act of 1995"
The PEZA was granted the power... to register, regulate, and supervise the enterprises
located in the economic zones.
By virtue of the law, the export processing zone in Mariveles, Bataan became the Bataan
Economic Zone... and the Mactan Export Processing
Zone the Mactan Economic Zone.
s for the EPZA, the law required it to "evolve into the PEZA
President Fidel V. Ramos issued Executive Order No. 282, directing the PEZA to assume
and exercise all of the EPZA's powers, functions, and responsibilities "as provided in
Presidential Decree No. 66
Facts of G.R. No. 184203
City of Lapu-Lapu, through the Office of the Treasurer, demanded from the PEZA... real
property taxes for the period from 1992 to 1998 on the PEZA's properties located in the
Mactan Economic
Zone.
It cited Sections 193 and 234 of the Local Government Code of 1991 that withdrew the real
property tax exemptions previously granted to or presently enjoyed by all persons.
PEZA filed a petition for declaratory relief... praying that the trial court declare it exempt
from payment of real property taxes.
According to the trial court, the PEZA remained tax-exempt regardless of Section 24 of the
Special Economic Zone Act of 1995.
The PEZA, therefore, is not liable for real property taxes on the land it owns.
Characterizing the PEZA as an agency of the National Government, the trial court ruled that
the City had no authority to tax the PEZA
The City then appealed
Facts of G.R. No. 187583
Issues:
Facts of G.R. No. 184203... whether... the PEZA is exempt from payment of real property
taxes.
Ruling:
The PEZA is exempt from payment... of real property taxes
Under Section 133(o), local government units have no power to levy taxes of any kind on
the national government, its agencies and instrumentalities and local government units:...
the PEZA is an instrumentality of the national government. It is not integrated within the
department framework but is an agency attached to the Department of Trade and Industry.
Attachment, which enjoys "a larger measure of independence"
As an instrumentality of the national government, the PEZA is vested with special functions
or jurisdiction by law. Congress created the PEZA to operate, administer, manage and
develop special economic zones in the Philippines.
Being an instrumentality of the national government, the PEZA cannot be taxed by local
government units.
Although a body corporate vested with some corporate powers,... the PEZA is not a
government-owned or controlled corporation taxable for real property taxes.
To be considered a government-owned or controlled corporation, the entity must have been
organized as a stock or non-stock corporation.
Government instrumentalities, on the other hand, are also created by law but partake of
sovereign functions. When a government entity performs sovereign functions, it need not
meet the test of economic viability
The law created the PEZA's charter. Under the Special Economic Zone Act of 1995, the
PEZA was established primarily to perform the governmental function of operating,
administering, managing, and developing special economic zones to attract investments
and provide opportunities... for preferential use of Filipino labor.
Under its charter, the PEZA was created a body corporate endowed with some corporate
powers. However, it was not organized as a... stock... or non-stock... corporation. Nothing
in the PEZA's charter provides that the
PEZA's capital is divided into shares.[272] The PEZA also has no members who shall
share in the PEZA's profits.
The PEZA does not compete with other economic zone authorities in the country. The
government may even subsidize the PEZA's operations. Under Section 47 of the Special
Economic Zone Act of 1995, "any sum necessary to augment [the PEZA's] capital outlay
shall be... included in the General Appropriations Act to be treated as an equity of the
national government."
The PEZA, therefore, need not be economically viable. It is not a government-owned or
controlled corporation liable for real property taxes.
The PEZA assumed the non-profit character, including the tax exempt status, of the EPZA
The PEZA's predecessor, the EPZA, was declared non-profit in character with all its
revenues devoted for its development, improvement, and maintenance. Consistent with this
non-profit character, the EPZA was explicitly declared exempt from real property taxes
under its... charter.
Nevertheless, we rule that the PEZA is exempt from real property taxes by virtue of its
charter.
The PEZA assumed the real property exemption of the EPZA under
Presidential Decree No. 66.
Principles:
Real property taxes are annual taxes levied on real property such as lands, buildings,
machinery, and other improvements not otherwise specifically exempted under the Local
Government Code.
Real property taxes are ad valorem, with the... amount charged based on a fixed proportion
of the value of the property.
Under the law, provinces, cities, and municipalities within the Metropolitan Manila Area have
the power to levy real property taxes within their respective... territories.
The person liable for real property taxes is the "taxable person who had actual or beneficial
use and possession [of the real property for the taxable period,] whether or not [the person
owned the property for the period he or she is being taxed]."
Republic vs Alagad

FACTS

On or about October 11, 1951, defendants filed an application for registration of their title over a parcel
of land situated at Linga, Pila, Laguna, with an area of 8.1263 hectares, reflected in survey plan Psu-
116971, which was amended after the land was divided into two parcels, namely, Lot 1 with an area of
5.2476 hectares and Lot 2 with an area of 2.8421 hectares, reflected in survey plan Psu-226971, amd. 2.

The Republic opposed the application on the stereo-typed ground that applicants and their
predecessors have not been in possession of the land openly, continuously, publicly and adversely under
a bona fide claim of ownership since July 26, 1894 and the land has not ceased to be a part of the public
domain. It appears that barrio folk also opposed the application. (LRC Case No. 189. G.L.R.O. Rec. No.
4922 of the Court of First Instance of Laguna).

By virtue of a final judgment in said case, promulgated January 16, 1956, supplemented by orders issued
on March 21, 1956 and August 13, 1956, defendants were declared owners of Lot 1 and the remaining
portion, or Lot 2, was declared public land. Decree No. N-51479 was entered and Original Certificate of
Title No. 0- 40 1, dated October 18, 1956, was issued in the names of defendants.

In August, 1966, Civil Case No. 52 of the Municipal Court of Pila, Laguna, was filed by defendants to evict
the barrio folk occupying portions of Lot 1. On August 8, 1968, judgment was rendered in the eviction
case ordering the defendants therein to return possession of the premises to herein defendants, as
plaintiffs therein. The defendants therein did not appeal.

The foregoing anterior proceedings triggered the filing of the instant case. On October 6, 1970, as
prayed for in the complaint, a writ of preliminary injunction was issued enjoining the Provincial Sheriff of
Laguna or his deputies from enforcing the writ of execution issued in Civil Case No. 52, and the
defendants from selling, mortgaging, disposing or otherwise entering into any transaction affecting the
area.

RULING

Property, according to the Civil Code, is either of public dominion or of private ownership ." 13 Property
is of public dominion if it is:

(1) ... intended for public use, such as roads, canals, rivers, torrents, ports and bridges constructed by
the State, banks, shores, roadsteads and others of similar character; 14 or if it:
(2) . . . belong[s] to the State, without being for public use, and are intended for some public service or
for the development of the national wealth. 15

All other property of the State, it is provided further, which is not of the character mentioned in ...
article [4201, is patrimonial property,16 meaning to say, property 'open to disposition17 by the
Government, or otherwise, property pertaining to the national domain, or public lands.18 Property of
the public dominion, on the other hand, refers to things held by the State by regalian right. They are
things res publicae in nature and hence, incapable of private appropriation. Thus, under the present
Constitution, [w]ith the exception of agricultural lands, all other natural resources shall not be
alienated.'19

Specifically:

ART. 502. The following are of public dominion:

(1) Rivers and their natural beds;

(2) Continuous or intermittent waters of springs and brooks running in their natural beds and the beds
themselves;

(3) Waters rising continuously or intermittently on lands of public dominion;

(4) Lakes and lagoons formed by Nature on public lands, and their beds;

(5) Rain waters running through ravines or sand beds, which are also of public dominion;

(6) Subterranean waters on public lands;

(7) Waters found within the zone of operation of public works, even if constructed by a contractor;

(8) Waters rising continuously or intermittently on lands belonging to private persons, to the State, to a
province, or to a city or municipality from the moment they leave such lands;
(9) The waste waters of fountains, sewers and public establishments.20

So also is it ordained by the Spanish Law of Waters of August 3, 1866:

Art. 44. Natural ponds and lakes existing upon public lands and fed by public waters, belong to the
public domain.

Lakes, ponds, and pools existing upon the lands of private individuals, or the State or provinces, belong
to the respective owners of such lands, and those situated upon lands of communal use belong to their
respective pueblos.21

Assuming, therefore, for purposes of this petition, that the lands subject of the Republic's reversion
efforts are foreshore in nature, the Republic has legitimate reason to demand reconveyance. In that
case, res judicata or estoppel is no defense.22

Of course, whether or not the properties in question are, indeed, foreshore lands is the core of
controversy. According to the trial court, the aforementioned parcel of land is a portion of the public
domain belonging to the Republic of the Philippines, 23 and hence, available disposition and
registration. As we have pointed out, the Government holds otherwise, and that as foreshore laud, it is
not registerable.

The question, so it follows, is one of fact: Is the parcel foreshore or is it part and parcel of the public
domain?

Laguna de Bay has long been recognized as a lake .24 Thus:

Laguna de Bay is a body of water formed in depressions of the earth; it contains fresh water coming
from rivers and brooks or springs, and is connected with Manila Bay by the Pasig River. According to the
definition just quoted, Laguna de Bay is a lake. 25

And, "[i]nasmuch as Laguna de Bay is a lake, so Colegio de San Jose further tells us, "we must resort to
the legal provisions governing the ownership and use of lakes and their beds and shores, in order to
determine the character and ownership of the parcels of land in question.26 The recourse to legal
provisions is necessary, for under Article 74 of the Law of Waters, [T]he natural bed or basin of lakes ... is
the ground covered by their waters when at their highest ordinary depth. 27 and in which case, it forms
part of the national dominion. When Laguna de Bay's waters are at their highest ordinary depth has
been defined as:

... the highest depth of the waters of Laguna de Bay during the dry season, such depth being the regular,
common, natural, which occurs always or most of the time during the year . . . 28

Otherwise, where the rise in water level is due to the extraordinary action of nature, rainfall for
instance, the portions inundated thereby are not considered part of the bed or basin of the body of
water in question. It cannot therefore be said to be foreshore land but land outside of the public
dominion, and land capable of registration as private property.

A foreshore land, on the other hand, has been defined as follows:

. . . that part of (the land) which is between high and low water and left dry by the flux and reflux of the
tides... 29

The strip of land that lies between the high and low water marks and that is alternatively wet and dry
according to the flow of the tide.30

If the submergence, however, of the land is due to precipitation, it does not become foreshore, despite
its proximity to the waters.

The case, then, has to be decided alongside these principles and regretfully, the Court cannot make a
ruling, in the first place, because it is not a trier of facts, and in the second, it is in possession of no
evidence to assist it in arriving at a conclusive disposition 31 We therefore remand the case to the court
a quo to determine whether or not the property subject of controversy is foreshore. We, consequently,
reverse both the Court of Appeals and the trial court and reinstate the Republic's complaint.

WHEREFORE, this case is hereby REMANDED to the trial court for further proceedings.