Property Notes A.Y. 2011-2012
Lopez-Rosario Lectures
I. DEFINITION OF TERMS
Property ≠ Thing
Property - any physical or real, juridical, and
legal entity of being capable of becoming the
subject matter or objective terminus of a juridical
relation (Sanchez Roman)
- Object for a validity of a contract.
- Can be appropriated
Thing - any object that exists and is capable of
satisfying human needs.
-includes both objects that are already
possessed or owned and those that are
susceptible of appropriation
REQUISITES OF PROPERTY (U-S-A)
1. Utility -
2. Substantivity - has a separate or autonomous
existence
3. Appropriability
*not all kinds of things are property, all kinds of
property are things
Examples:
1. Kidney of a human being, thing or property?!?
We must determine first W/N it can be
sold. If it is a property, no problem because it
can be appropriated. If it is a thing, the validity of
the sale can be attacked because the object of
the sale is outside the commerce of men.
* outside the commerce of man , illegal
* health and sanitation purpose
*can only be donated to Filipinos
2. Corpse (usually found in med school)
- thing, not susceptible of appropriation
- in reality there might be illegal
transactions, legally speaking it is not subject to
sale
(connect to OBLICON, elements of a valid
contract: consent, object- within commerce of
man, cause)
Movable ≠ Immovable
Art. 414. All things which are or may be the object of
appropriation are considered either:
(1) Immovable or real property; or
(2) Movable or personal property
Atty.
Movable (Personal Property) - which can be
transferred from one place to another
Immovable (Real Property) - which cannot be
transferred from place to place without
destruction to itself
*ART. 415 - enumeration of immovable
properties.
Art. 415. The following are immovable property:
(1) Land, buildings, roads and constructions of all kinds
adhered to the soil;
(2) Trees, plants, and growing fruits, while they are
attached to the land or form an integral part of an
immovable;
(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;
(4) Statues, reliefs, paintings or other objects for use or
ornamentation, placed in buildings or on lands by the
owner of the immovable in such a manner that it reveals
the intention to attach them permanently to the
tenements;
(5) Machinery, receptacles, instruments or implements
intended by the owner of the tenement for an industry or
works which may be carried on in a building or on a piece
of land, and which tend directly to meet the needs of the
said industry or works;
(6) Animal houses, pigeon-houses, beehives, fish ponds or
breeding places of similar nature, in case their owner has
placed them or preserves them with the intention to have
them permanently attached to the land, and forming a
permanent part of it; the animals in these places are
included;
(7) Fertilizer actually used on a piece of land;
(8) Mines, quarries, and slag dumps, while the matter
thereof forms part of the bed, and waters either running or
stagnant;
(9) Docks and structures which, though floating, are
intended by their nature and object to remain at a fixed
place on a river, lake, or coast; (10) Contracts for public
works, and servitudes and other real rights over immovable
property
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Property Notes A.Y. 2011-2012
Juridical Classification of Real Properties
(N-I-D-A)
1. by Nature - by itself cannot be moved from
one place to another
*if you are reading the book of Justice
Paras, you may cite par.1 and par.8 of Art. 415,
but according to Mam LR, land is the only real
property by nature. Literal meaning of nature…
*Buildings - incorporated to the soil, by
its nature it is a personal property, but the
moment the removal of the building causes
injury to the soil, it will be a real property by
incorporation
2. by Incorporation - must be substantial and
not provisional.
- separation from the immovable may
cause damage or deterioration.
*trees and plants are real property by
incorporation.
3. by Destination - should be placed by the
owner
4. by Analogy - contracts for public works and
servitudes and other real rights over immovable
property.
*explanation*
By nature - no problem, very easy, only needs
common sense…
By Analogy - no problem also…
By Incorporation - REMEMBER:
1. W/N it will cause damage when removed?
2. Is the person who introduced it important?
- NO! What is important is the moment it
is detached, it will cause damage or injury.
Examples:
a. fertilizer - already applied to the soil, difficult
to remove it without damage or injury to the soil,
hence it is a real property by incorporation. If still
in bags, personal property!
b. plants - still in plastic bag = personal property,
if it is planted, you cannot remove it without
causing damage to soil, regardless of who
planted the damned plant!
c. tiles - it depends, real by incorporation those
fixed in the bathroom or flooring, if still in
Atty. Lopez-Rosario Lectures
hardware or those removed by Mayor Lim in
Avenida = personal property.
d. in a contract of lease - as a G.R., properties
placed by the tenant/lessee are personal
property, XPN if the tenant is the agent of the
owner.
If informal settler (squatter for the
politically incorrect), does not have the authority.
Properties will never be personal, it will remain
real properties.
By Destination - 2 KINDS:
1. machineries/ equipments -
important who placed the property, if it is
necessary
Example:
a. chair in classroom - Is it the owner who
placed it there? How relevant is a chair to the
industry (education)? Have you been to a
classroom without a chair?
b. trash can - Can we still conduct classes eve if
we do not have trash can?
c. Vendo Machine - Is it relevant to our
education?
2. ornaments - the person who
introduced it is important, must be the owner.
The intention to attach the property permanently
is also important.
Example:
a. Statue of St. Raymond and Mother Perpetual
- Is it important? OPKORS! It is an ornament,
UST is a catholic school, intention of attaching it
permanently without being transferred.
Elements of Real Property by Destination
1. owner introduced it
2. necessary to the trade or industry, or even if
not necessary there is the intention of attaching
the property permanently
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Property Notes A.Y. 2011-2012
CASES
Ladera vs. Hodges (buildings are
immovable)
“buildings and constructions are regarded as
mere accesories to the land (following the
Roman maxim omne quod solo inaedificatur
solo credit) it is logical that said accessories
should partake of the nature of the principal
thing, which is the land forming, as they do,
but a single object (res) with it in contemplation
of law.” - Justice JBL Reyes
Manalang vs. Ofilada
“a building of mixed materials may be the
subject of a chattel mortgage, in which case it is
considered as between the parties as personal
property”
“The SC hols that the mere fact that a house
was the subject of a chattel mortgage and
was considered as personal property by the
parties does not make said house personal
property for purposes of the notice to be
given for its sale at public auction. The house
of mixed materials levied upon on execution,
although subject of a contract of chattel
mortgage between the owner and a third person,
is real property within the purview of Rule 39,
section 16, of the Rules of Court as it has
become a permanent fixture on the land, which
is real property. “
Valdez vs. Altagracia
“machinery placed on property by a tenant
does not become immobilized; when,
however, a tenant places it there pursuant to
contract that it shall belong to the owner, it
becomes immobilized as to that tenant and
his assigns with notice, although it does not
become so as to creditors not having legal
notice of the lease”
Davao Saw Mills vs. Castillo
“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. it was held that machinery which
is movable in its nature only becomes
Atty. Lopez-Rosario Lectures
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.”
McMicking vs. Banco Espanol
“A ship is a personal property. It was the subject
of a CHATTEL mortgage in this case”
Manese vs. Velasco
Foreshore Lands - strip of land that lies
between the high and low water marks and is
alternatively wet and dry according to the flow of
the tides. It is that part of the land adjacent to
the sea, which is alternately covered and left dry
by the ordinary flow of tides. It is part of the
alienable land of the public domain and may be
disposed of only by lease and not otherwise.
Foreshore land remains part of the public
domain and is outside the commerce of man. It
is not capable of private appropriation
In all actions for the reversion to the
Government of lands of the public domain or
improvements thereon, the Republic of the
Philippines is the real party in interest. The
action shall be instituted by the Solicitor
General or the officer acting in his stead, in
behalf of the Republic of the Philippines.
Moreover, such action does not prescribe.
Prescription and laches will not bar actions
filed by the State to recover its property
acquired through fraud by private
individuals.
Laurel vs. Abrogar
“in making the international phone calls, the
human voice is converted into electrical
impulses or electric current which are
transmitted to the party called. A telephone call,
therefore, is electrical energy. It was also held
in the assailed Decision that intangible
property such as electrical energy is capable
of appropriation because it may be taken and
carried away. Electricity is personal property
under Article 416 (3) of the Civil Code, which
enumerates “forces of nature which are
brought under control by science.”
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Property Notes A.Y. 2011-2012
Movables = Personal Property
* If the property is not enumerated under Art.
415, it is personal property
1. BY NATURE -
Art. 416. The following things are deemed to be personal
property:
(1) Those movables susceptible of appropriation
which are not included in the preceding article;
(2) Real property which by any special provision
of law is considered as personal property;
(3) Forces of nature which are brought under
control by science; and
(4) In general, all things which can be
transported from place to place without
impairment of the real property to which they
are fixed.
2. BY ANALOGY
Art. 417. The following are also considered as personal
property:
(1) Obligations and actions which have for their
object movables or demandable sums; and
(2) Shares of stock of agricultural, commercial
and industrial entities, although they may have
real estate.
Q: Why do we need to classify property as
real or personal? Why is it important?
A: Because different provisions of law deals with
different kinds of property. You don’t believe
me? Here are some examples:
a) Credit Transactions
If you want to obtain loan and you give your
house to creditor as collateral, that is a REAL
ESTATE mortgage. If you give your car as
collateral, that is CHATTEL mortgage.
b) Criminal Law
The RPC defines theft as the unlawful taking of
personal property with intent to gain. If its real
property, it can be unlawful detainer or
usurpation.
(still not convinced?!? Eto pa isa…)
c) Taxation
Tax on your land is REAL ESTATE tax,
AMILYAR.
Atty. Lopez-Rosario Lectures
CASES
Bicerra vs. Teneza
A demolished or dismantled house ceases to be
real property, it becomes a personal property.
Mindanao Bus. Co. Vs. City Assessor
The SC held in this case that for tax purposes
especially real estate tax, property which are
only INCIDENTAL to the business that are in the
building need not be included in the tax
assessment. (told you!!!) These personal
properties which are NOT necessary to the
course of the business, meaning they can still
conduct the business without them, should be
considered as immobilized by destination.
Involuntary insolvency of Strochecker vs.
Ramirez
A person’s !/2 interest in a business is personal
property. They may be the subject of a
mortgage, capable of appropriation and most of
all, it is not included in the enumeration.
Sibal vs. Valdez
For purposes of attachment, execution and the
Chattel Mortgage Law, growing crops or
ungathered products or fruits have the nature of
personal property.
Fungible ≠ Consummable
Art. 418. Movable property is either consumable or
nonconsumable. To the first class belong those
movables which cannot be used in a manner
appropriate to their nature without their being
consumed; to the second class belong all the others.
Consummable - cannot be used in a manner
appropriate to their nature without being
consumed.
Mam LR: What do you mean without being
consumed? In Philosophy, it is a number one
rule that you do not use the rootword in the
definition. Clearly, our legislators are not
philosophers…
(very bright talaga si Mam! So in light of this BS
definition given by the law, she formulated a
formula (haha!) to determine consummability.)
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Property Notes A.Y. 2011-2012 Atty. Lopez-Rosario Lectures

*title - notice to the whole world, protects the

In order to determine consummability:
1. Is there a reduction or decrease in the the
quantity?
- if you borrow the sign pen of your
classmate because you are very burara you
don’t even have a pen, look at the ink, there is a
decrease in the quantity! Unjust enrichment took
place! Pay your classmate because you used
the ink! UNJUST ENRICHMNET!
rd
owner of the property, binds 3 persons,
ownership must be respected
2. Public Properties -
*public dominion - inalienable, owned by
the government, regalia doctrine, outside the
commerce of men.
*patrimonial porperties - owned by the
state in its private capacity, proprietary, may be
alienated

2. Is there a physical destruction of the

property? Property for Public Use ≠ Property
- Example talaga ni Mam yun kandila at for Public Service
posporo, but I have another example… YOSI! 
Distinction:
3. Is there deterioration of the thing?
- If you are washing your clothes, look at PUBLIC USE PUBLIC SERVICE
the water, not as clear as before? Well, that is
- used indiscriminately - intended for
the deterioration we are talking about. You
by anyone, regardless authorized persons
cannot use the same water to drink or to take a
of age, sex or race only.
bath… unless you have a non-functioning
because even EXAMPLES
mind…
foreigners may use Libingan ng mga
them. Bayani
EXAMPLES: PGH
Fungible- property that can be replaced by
Luneta Park Camp Crame
another property of the same kind or quality.
Streets
- replaceable by equal quantity either by
Bridges
agreement or by nature
Roads
Q: What kind of contract will require fungible
goods?
CASES
A: Contract of Loan! In credit transactions
(mutuum), obligation of the debtor to return the
Harty vs. Mun. of Victoria
value of the money he borrowed, but not the
same money.
“Plaza of the Church is property of public
Dominion, therefore it cannot be alienated, sold,
Q. What kind of goods in a commodatum?
in short, it is outside the commerce of men.”
A. Non-consumable. In a commodatum, the
bailor delivers to the bailee the exact thing that
Ocsio vs. CA
the bailee left in his possession.
“The Supreme Court held that Patrimonial
Property may be acquired through prescription.
Property of Public Dominion ≠ A religious corporation is a juridical person, it
Patrimonial Property can also acquire property”

Property Based on Ownership: Heirs of Sps. Palanca vs. Republic

1. Private Ownership - owned by private The subject parcel of land in this case is forest
persons, whether juridical or natural. Can be land, being a property of public dominion cannot
acquired by acquisitive prescription. be owned by private individuals.
*registered land - not subject to prescription.

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Property Notes A.Y. 2011-2012
Province of Camarines Sur vs. CA
As regards properties for public use, the
principle is the same: property for public use can
be used by everybody, even by strangers or
aliens, in accordance with its nature; but nobody
can exercise over it the rights of a private owner.
CLASSIFICATION OF THINGS
*RES - latin word for property
Res Nullius- belongs to no one, not yet
appropriated but susceptible to appropriation.
- Look in the Botanical Garden of UST,
you will see butterflies, salagubang, spiders
etc… If you want to get these poor insects and
then a Dominican Father will reprimand you, Tell
him “Father, these are res nullius, nobody owns
them.”
Res Communes- belonging to
everyone
- air, sun moon
Res Derelicta - abandoned property
with the intention of no longer owning
them
- garbage
Res Alicujus - tangible or intangible
things which are owned privately, either
in a collective or individual capacity,
belonging to someone
Builder/Possessor in Good Faith ≠
Builder/Possessor in Bad Faith
*Good Faith:
In the Family Code - Authority of
Solemnizing Officer must be mistake in fact not
mistake in law.
In Property - the belief that the person
from whom he received the thing was its owner
and could transfer valid title thereto.
Builder in Good Faith - builder is considered in
good faith if he thought that the land was his.
Builder is also considered in good faith if he
constructed on the land of another with the
consent of that landowner.
Atty. Lopez-Rosario Lectures
*Bad Faith:
- characterized by malice, dishonesty
and unlawful intent
Builder in Bad Faith - a person who constructs
improvements upon a parcel of land which he
believes as not his or that he is aware that there
exists in his title or mode of acquisition a flaw
which invalidates it or that knowing that he is not
the owner of said land he undertook construction
thereon without the knowledge and consent of
the owner thereof.
CASES
Premier Bank vs. CA
“A purchaser of a property cannot be in
good faith where the title thereof shows that it
was reconstituted”
“Banks, being in the business of
extending loans secured by real estate
mortgage, is familiar with rules on land
registration , and as such, it is expected to
exercise more care and prudence than private
individuals in their dealing with registered land…
that Premiere Bank accepted in mortgage the
property in question notwithstanding the
existence of structures on the property and
which were in actual, visible and public
possession of a person other that the mortgagor,
constitutes gross negligence amounting to bad
faith.”
Cua vs. Vargas
“Petitioner derived his title from the
Extra-Judicial Settlement Among Heirs and he
was very much aware that not all of the heirs
participated therein as it was evident on the face
of the document itself. Because the property had
not yet been partitioned in accordance with the
Rules of Court, no particular portion of the
property could have been identified as yet and
delineated as the object of the sale. This is
because alienation made by respondents’ co-
heirs was limited to the portion which may be
allotted to them in the division, upon termination
of the co-ownership. Despite this glaring fact,
and over the protests orf respondents, petitioner
still constructed improvements on the property.
For this reason, his claim of good faith lacks
credence.”
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Property Notes A.Y. 2011-2012
Real Right ≠ Personal Right
Real Right - one that confers upon its holder an
autonomous power to derive directly from an
appropriate thing certain economic advantages,
independently of whoever should be the
possessor of the thing.
Personal Right - power belonging in one
person in demand of another as a definite
passive subject the fulfillment of a prestation to
give, to do or not to do.
Q: When you say that a Real Right is
enforceable against the whole world, does it
mean that you have to file an action against
everybody? Why enforceable against the
whole world?
A: No. A real right is the right of pursuit, it follows
you wherever you go, because regardless of
who is the owner, the right must be respected.
Q: Does it follow that when we say real right
it pertains to real property and if it is a
personal right it pertains to personal
property?
A: NO! ABSOLUTELY WRONG!
Q: What is Succession?
A: it is a mode of acquiring ownership over
property, rights and obligations.
Q: If a Creditor dies, may the heirs collect
from the debtor?
A: Yes, rights are transmissible.
Q. Give an example of a real right in
connection with succession.
A. Right of ownership.
Q. Is the right to collect rentals a real right?
Why?
A: Because the rentals emanates from the
property.
Q. If for example a certain person was given
a scholarship by the university and was
given a grant (money), then afterwards this
person dies, can the university get back the
grant? Is the right to the scholarship grant
transmissible to the heirs?
A. YES! The university can get back the grant.
The grant given is a PERSONAL RIGHT. The
heirs do not acquire any right over the
scholarship money. It is personal to the
deceased.
Atty. Lopez-Rosario Lectures
REMEMBER:
Real Right = Action in REM
 it is attached to the property whoever
the owner may be. The court will
proceed to try the case even without
defendant.
 E.G. In judicial foreclosure, the court will
continue the proceedings even without
the presence of the owner. You do not
need the owner to foreclose the
property.
Personal Right = Action in PERSONAM
 The right is attached to the person. If
person dies, no more right. It ceases
upon the death of the person
 The court will not acquire jurisdiction
unless the person submits himself
before it.
GEN. RULE. Right to Lease & Right to Usufruct
are REAL RIGHTS.
XPN: it may be stipulated in the contract that
when the lessee or the usufruactuary dies
before the end of the lease or usufruct period,
the owner of the property may pre-terminate the
contract, hence the heirs of the lessee or
usufruactury must evacuate the property.
Necessary Expenses ≠ Useful
Expenses ≠ Ornamental/Luxury
Expenses
Necessary Expenses - refer to those expenses
which without it the thing will physically
deteriorate or perish.
REMEMBER: In all contracts the owner has the
obligation to shoulder the NECESSARY
expense because he is the one who will benefit
from it. Even though a temporary holder of the
property will provide this without the owner’s
consent, still need to reimburse.
Examples:
1. services to clean the air-con
2. for wooden floors - solignum, floorwax
3. bread and canned goods - preservatives
Useful Expenses - refer to those which
increase the productivity or raise the value of the
thing.
REMEMBER: In all contracts, CONSENT from
the owner is necessary for the owner to be
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Property Notes A.Y. 2011-2012
responsible for the necessary expense,
otherwise the one who introduced the useful
expense will shoulder the expenses incurred.
Example:
In Hotel Rooms, the greater number of
amenities, the more expensive it is.
Ornamental/Luxury Expenses - refer to those
which add to the value of the thing but is neither
essential to the preservation nor useful to
anybody in general.
REMEMBER: In all contracts, the luxury
expense is ALWAYS shouldered by the one who
introduced it. No right to demand reimbursement
from the owner.
*In contracts you usually see:
1. Ordinary expense - due to the ordinary wear
and tear, shouldered by the person enjoying the
possession of the property.
e.g. light bulbs, gasket in faucet
2. Extraordinary expense - equivalent to
necessary expense, owner will be responsible
e.g. leaking roof
TAKE NOTE: WHO SHOULD BE
RESPONSIBLE FOR DIFFERENT KINDS OF
EXPENSES IN CONTRACTS THAT INVOLVES
TEMPORARY TRANSFER OF
OWNERSHIP?!?
Ownership ≠ Possession
OWNERSHIP - may be exercised over things or
right (Art. 427)
- The independent and general right
of a person to control a thing
particularly in his possession,
enjoyment, disposition and recovery
subject to those established by law
- no restrictions except those
imposed by law or private persons
- right to dispose, enjoy, recover the
thing without further limitations
POSSESSION - simply a right of an owner
Atty. Lopez-Rosario Lectures
-Kinds of Ownership-
1. Full ownership - includes all the rights of an
owner
2. Naked ownership - right to use, fruits have
been denied
3. Sole ownership - vested in only one person
4. Co-ownership - 2 or more owners
-6 Rights of an Owner-
1.Jus possidendi - to possess
Q: What kind of contract gives the right to
possess but not all the other rights?
A: Contract of Deposit - safekeeping of the
property, baggage counter
2. Jus fruendi - to enjoy the fruits
Kinds of Fruits:
Natural fruits - young of animals, plants
which grew without the intervention of man
Industrial Fruits - produced by lands of
any kind through cultivation or labor
Civil fruits - rents of buildings, the price
of leases of lands and other property and the
amount of perpetual or life annuities or other
similar income
Q: What if the animal was from artificial
insemination? What about cloned animals?
What kind of fruit? Is it still a natural fruit, or
does it become an industrial fruit?
A: 2 Answers:
1. In StatCon - if the law is clear
(unambiguous), there is no need for
interpretation, meaning hayop pa rin naman yun
so it will remain hayop forevermore, meaning
still a natural fruit.
2. Consider the time when our civil code
was drafted, 1950! At that time our legislators
probably did not imagine that artificial
insemination or cloning would be possible, so if
there is intervention of man already, may be
considered an industrial fruit.
(Mam LR said that this is just something to think
about, it is not yet asked in the Bar Exam, kapag
naging examiner daw siya itatanong niya daw so
be ready with a very good argument! :P )
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Property Notes A.Y. 2011-2012
3. jus utendi - to use
Q: What kind of contract gives the right to
use even if you are not the owner of the
property?
A: Contract of Commodatum
4. jus abutendi - to abuse, use the property not
in accordance with its proper purpose, only the
owner is given the right.
5. jus disponendi - to dispose (consume,
Encumber, Alienate), transfer ownership
6. jus vindicandi - to recover, there must be
actual usurpation
Possession - only a right of the owner
Ownership - all encompassing
Contract of Lease
1. Right to possess
2. Right to use
3. If stipulated, right to enjoy
- lessee can act as lessor to a
rd
3 person (sublease), but the right to
dispose still remains with the original
owner
- new Rent Control Law, there
must be a written consent from the owner that
the lessee may sub-lease the property.
Mutuum (simple load) - Transfer of ownership
upon delivery of the thing
All Rights = Money / Fungible
- Returned bills no longer the original
bills
Contract of Usufruct
1. Right to possess
2. Right to use
3. Right to enjoy the fruits
Q: What is the difference between a Contract
of Lease and a Contract of Usufruct?
A: A contract of lease is always onerous, while a
contract of usufruct may be gratuitous or
onerous. There is nothing in the provisions on
usufruct that provides for rentals
Doctrine of Self-Help
Art. 429. The owner or lawful possessor of a thing has
the right to exclude any person from the enjoyment
and disposal thereof. For this purpose, he may use
such force as may be reasonably necessary to repel or
prevent an actual or threatened unlawful physical
invasion or usurpation of his property.
Atty. Lopez-Rosario Lectures
Q: In the Revised Penal Code, what is the
equivalent of the Doctrine of Self Help?
A: Art. 11 of the RPC - Self Defense.
Requisites:
1. lack of provocation on the part of the
offender
2. there must be an imminent danger
3. the offender used reasonable means
to repel the danger, threat or unlawful
act
4. defense of one’s self, relatives,
stranger and PROPERTY
Q: What is the connection between self-help
and self-defense?
A: Both uses force as may be reasonably
necessary to repel or prevent any actual or
threatened unlawful act.
*The usurpation must be actual or
threatened. Cannot be when the usurpation
already took place.
Doctrine of Incomplete Privilege
Q: Why is it called incomplete privilege?
A: Because the owner does not have the
absolute right, interference is necessary to
prevent greater damage to adjoining properties.
“State of necessity” - in criminal law considered
as a justifying circumstance.
- to prevent greater evil
Basis of Benefit:
Art. 432. The owner of a thing has no right to
prohibit the interference of another with the same,
if the interference is necessary to avert an imminent
danger and the threatened damage, compared to
the damage arising to the owner from the
interference, is much greater. The owner may
demand from the person benefited indemnity for
the damage to him.
Art. 23 (Civil Code) - even when an act or event
causing damage to another’s property was not
due to fault / negligence of defendant, the one
who was benefited will be liable.
9
Property Notes A.Y. 2011-2012
Examples:
1. House on Fire. To prevent it from spreading,
the house next to it will be destroyed
Liable - pro-rata “proportionately “
2. Remember Ondoy? The authorities released
water to prevent damage to dam.
2. People inside elevator then there was a black-
out. The elevator will be destroyed.
Limitations to One’s Ownership
Q: From Criminal Law, let’s now go to
Constitutional Law, what are the 3 inherent
powers of the State?
A: Police Power, Eminent Domain, Taxation
Gen.Rule: Art. 437 - The owner of a parcel of
land is the owner of its surface and of everything
under it , and he can construct thereon any
works or make any plantations and excavations
which he may deem proper
XPNs:
1. without detriment to servitudes
2. subject to special laws and ordinances
3. aerial navigation
Owner cannot use his property in a manner
rd
that will injure the rights of 3 persons.
Q: In taxation, how can you say that it limits
one’s property?
A: Example:
1. salary - withholding taxes
Doctors and LAWYERS are being run
after by BIR because they are self-employed.
2. real property - failure to pay real
estate tax can give government the privilege to
foreclose your property.
“foreclose” - sell your property at auction
3. when you eat burger - you are being charged
value-added tax
4. Family Home - Art. 155 Fc
G.R. exempt from execution, forced sale
or attachment
XPN 1) non-payment of taxes
2) Etc.
Atty. Lopez-Rosario Lectures
Eminent Domain - taking of private property for
public use upon just compensation, more of a
forced acquisition.
Forced sale, compelled by the
government, whether or not you want to sell
your property.
Requisites:
1. Exercised by competent authority
2. Expropriation for public use
3. Payment of just compensation
4. Observance of due process - Rule 67
*property is preserved * devoted to public use.
Reasonable necessity is required not absolute
necessity to expropriate a property.
Example: C-3
- Many houses were removed by
power of eminent domain
- There was an act of preservation
Just compensation - fair and full equivalent of
the loss sustained, determined by the court. If
the government does not pay a suit may be
brought against the auditor general.
Police Power - destruction of property for the
benefit of the public in general.
-No just compensation
Example: Act of MMDA
- Generally, does not have police power,
administrative in nature
-it has the power to enforce laws in
accordance with a valid law implementing it
- If public expediency calls for it and
clear & present danger rule
rd
Limitations imposed by 3 persons
Art. 431. The owner of a thing cannot make use thereof
in such manner as to injure the rights of a third person.
*enjoyment of property is limited if it will
rd
prejudice the rights of 3 persons.
*even if you are the owner, you do not have
absolute enjoyment, think of others
Restrictions by the State:
Q: Can you bury a corpse in your backyard?
A:No, this is not allowed because of sanitation
purposes.
10
Property Notes A.Y. 2011-2012
Q. Can you dig a very deep hole for
swimming pool in your backyard w/out
permit from Eng. Dept.?
A. No. if you do that again & again, it could
affect adjacent land - Art. 431 (rights of 3rd
Person)
Q. Can you make a CR with a big window?
A. No. Even though according to the law you are
the owner above & underneath, take note that
there are restrictions.
Restrictions made by private persons:
Example: In subdivisions - there are restrictions
imposed by developer like in the style or design
of the house, there are also restrictions in the
disposability of the property.
II. Hidden Treasure
Art. 438. Hidden treasure belongs to the owner of the
land, building, or other property on which it is found.
Nevertheless, when the discovery is made on the
property of another, or of the State or any of its
subdivisions, and by chance, one-half thereof shall be
allowed to the finder. If the finder is a trespasser, he
shall not be entitled to any share of the treasure.
If the things found be of interest to science of the arts,
the State may acquire them at their just price, which
shall be divided in conformity with the rule stated.
Art. 439. By treasure is understood, for legal purposes,
any hidden and unknown deposit of money, jewelry,
or other precious objects, the lawful ownership of
which does not appear.
-any hidden & unknown deposit of money,
jewelry or other precious objects, the lawful
owner of which does not appear
-discovered by chance
By chance - “good luck”
- Doesn’t preclude a finder who
purposely hunt for hidden treasure
Gen.Rule. - If owner finder, totally belongs to
the owner of land, bldg. / property
XPNs. Finder different from owner, entitled to ½
1. discovered in property of another
2. discovery by chance
Atty. Lopez-Rosario Lectures
3. not trespasser or agent of owner
* The state may in the interest of science or the
arts, acquire such hidden treasure at a just price
to be as allocated as G.R. * XPNS.
* trespasser - not entitled to get any share
because he cannot be allowed to benefit from hi
unlawful act.
* Right of Finder employed to look for treasure:
no share in the treasure unless agreed upon. He
can only ask for his wage.
*If finder is married, his share in the treasure
belongs to the absolute community property.
(Art. 117 par. 4 FC)
ELEMENTS OF HIDDEN TREASURE
1) hidden/unknown deposit of money, jewelry /
other precious objects -> same class as money
or jewelry
2) Lawful owner is unknown
3) Discovered by chance
4) Discovered / finder must not be trespasser
Q. Maria (labandera) of Juan (owner) , after
laundry, clean backyard, discovered an
object, turned out to be jewelry. Hidden
Treasure? Right of Maria?
A. Yes. Look at elements, Maria not a
trespasser, 50%.
Q. Owner hired services of a group of men to
find hidden treasure. If there is hidden
treasure, who owns?
A. It depends. If there is a stipulation, finder is
entitled to 50%, if no agreement not entitled.
Finder is only entitled to be paid for services.
Q. Bills coming from bank, buried,
subsequently found. Hidden Treasure?
A: Bills - has serial number. Can be traced,
identity known. Not HT
Q. Usufructuary (lessee) finds Hidden
Treasure. Who owns?
A. Although the usufructuary is in actual
possession of property, still he is NOT the
owner, only entitled to 50% other 50% to owner.
11
Property Notes A.Y. 2011-2012
Q. Yamashita Treasure?
A. P.D. 172 - 25% granted to finder - 75% - gov’t
In relation to ART. 719 - “finder’s keeper”
- Whoever finds a property not a
treasure has the obligation to
surrender it to proper authority. After
posting of found object and 6
months will pass and no owner
appears, the finder of the object will
be entitled to it. If owner appears,
finder is entitled to 1/10 of the value
of the object.
(Some unanswered questions)
1. How do you reconcile Art. 719 with hidden
treasure?
2. What does the law mean when it provides that
the lawful owner must be unknown?
3. When will you apply Art.719 and when will
you apply the provision on Hidden Treasure?
III. ACCESSION
Accession ≠ Accessory
Accession - not a mode of acquiring ownership
(book 3 of NCC enumerates the modes of
acquiring ownership, accession not include)
-simply an extension of ownership over
a thing to whatever is incorporated thereto
naturally or artificially (with or without human
labor)
- Can happen both in real and personal
property
- fruits of or additions to improvements
upon the principal
Remember ( API )
Attached, Produced, Incorporated
Note: Accession exists if the incorporation is
such that separation would seriously
damage either thing or diminish its value
Accessories - ornaments to add beauty and
may be removed without causing injury
Example : Ladies - those attached from head to
foot are accessories
- “lahat ng pwedeng mapagsabitan /
matusukan”
Reason: before you sleep, you can simply
remove them.
Atty. Lopez-Rosario Lectures
- things joined to, or included with the principal
for the latter’s embellishment, better use or
completion.
Note: While accessions are not necessary to
the principal thing, the accessory and the
principal MUST go together.
Kinds of Accession
1. Accession Discreta - right to the fruits
Art. 441. To the owner belongs:
(1) The natural fruits;
(2) The industrial fruits;
(3) The civil fruits.
Art. 442. Natural fruits are the spontaneous products of the
soil, and the young and other products of animals.
Industrial fruits are those produced by lands of any kind
through cultivation or labor.
Civil fruits are the rents of buildings, the price of leases of
lands and other property and the amount of perpetual or life
annuities or other similar income.
Q: To whom will the fruits belong?
A: Gen.Rule:
1. If you are the Owner of the property,
you are entitled to the fruits of the
property
2. Possessor in good faith, entitled to the
fruits
3. Others who are still entitled to fruits:
a. usufructuary -
Right to possess
Right to use
Right to enjoy
b. antichresis creditor
Antichresis - kind of security
where in what is used in the
security is fruits of the property
to answer for the interest in the
loan of a thing.
- If no interest agreed upon, the
fruits will be used to answer for
the principal obligation
c. lessee - if there is no express
prohibition against sublease, is
entitled to the fruits.
2. Accession Continua - by external forces
(building, alluvium, etc.)
12
Property Notes A.Y. 2011-2012
With Respect to REAL PROPERTY
2.1 Accession Industrial - by the work
of man (building, planting, sowing)
- Involves a person who through
building, planting or sowing, introduces an
improvement on the property.
3 Categories of Builder/Planter/Sower
1. Landowner is the B/P/S, who is different from
the owner of the material. (2 Personalities)
- Land owner B/P/S
- OM (owner of the material)
2. Landowner is different from the B/P/S who is
the owner of the material. (2 Personalities)
- Land owner
- B/P/S OM
3. Landowner different from BPS, different from
owner of the material. (3 personalities)
- landowner
- B/P/S
- OM
Guidelines:
1) Is there really accession?
- Remember the definition of Accession,
whatever is Attached, Produced or Incorporated
(A-P-I)
2) Accessory follows the principal
- How will you apply?
G.R. - owner of the real property w/n good faith
or bad faith has the right to own whatever he
planted, built or sowed in the property.
Reason: Because of the principle that accessory
follows the principal
Example:
a) between Land vs.
building/planted/sowed land = principal
Whatever is built, planted or sown = accessory
Reason: because the land can exist by itself
w/o any building or plant bldg. /plant cannot
exist w/out being attached to the land
b) hanging plant (on air)?
*does not apply
Gen. Rule - In BPS, whatever is planted on
the soil should be attached to the land
*Tignan ang definition!!! wag tamad
3) Whoever is the owner of the principal is
the owner of the accessory.
4) Application of the principle of unjust
enrichment
Atty. Lopez-Rosario Lectures
*whatever has been acquired, it is the obligation
of the owner of the real property to pay the
proper indemnity.
* It is the right of the owner of the land to:
-acquire whatever is planted
-acquire whatever is build
E.G. Juan b,p,s in good faith. He planted /
constructed his house on a real property he
thought was his.
Good Faith : (1) b,p,s believes that real property
belongs to him
(2) believes that title over the
property does not have any defect/flaw.
st
* XPN to the 1 principle.
*depending on the owner of the
property, B,P,S has the right to acquire the land
*PROVIDED, that the value of the land
is not higher than the value of improvement of
what has been built, planted or sowed.
Reason:
(a) If owner does not like the property he can
sell to b,p,s provided that the value of the
real property is not higher than the
improvements
(b) If the value of the land is higher than the
improvements, the agreement would be a
contract of lease.
5) Bad Faith - landowner; b,p,s; owner of
materials whoever it is always liable for
damages
a. Owner of real property in bad faith
 He will acquire whatever is built/sown
applying principle that accessory follows
the principal BUT he has to pay the
proper indemnity for the value of what
has been built, planted or sown but in
addition to that being in Bad faith, he is
liable for damages.
b. B,P,S (bad faith)
 liable for damages
In relation to necessary expenses
-the B,P,S (whether in good faith or bad
faith) , has the right to demand for
reimbursement of whatever necessary
expenses he incurred from the owner of the real
property.
-B,P,S is given the right of retention in
relation to accession industrial
13
Property Notes A.Y. 2011-2012
*right of security / right of retention
-given to the B,P,S for purposes of
serving as a guarantee that he can retain the
property as long as the owner of that property
(real) has not given the amount that he (b,p,s)
has incurred for the necessary & useful expense
Reason: so that the B,P,S can get an assurance
that the owner will reimburse him for whatever
necessary expenses he has incurred.
In relation to useful expense
*good faith = can demand
reimbursement from owner of property
*bad faith = not demandable
CASES
Ballatan vs. CA
“The right to choose between appropriating the
improvement or selling the land on which the
improvement of the builder, planter or sower
stands, is given to the owner of the land.”
“In the event that the owner elects to sell to the
builder, planter or sower the land which the
improvement stands, the price must be fixed at
the prevailing market value at the time of
payment This case is not for expropriation. This
is a case of an owner who has been paying real
estate taxes on his land but has been deprived
of the use of a portion of this land for years. It is
but fair and just to fix compensation at the time
of payment.”
Sulo Sa Nayon Inc. vs. Nayong Pilipino
Foundation
“This article [Article 448] is manifestly intended
to apply only to a case where one builds,
plants, or sows on land in which he believes
himself to have a claim of title, and not to
lands where the only interest of the builder,
planter or sower is that of a holder, such as a
tenant.
In the case at bar, petitioners have no adverse
claim or title to the land. In fact, as lessees, they
recognize that the respondent is the owner of
the land. What petitioners insist is that because
of the improvements, which are of substantial
value, that they have introduced on the leased
premises with the permission of respondent,
they should be considered builders in good faith
Atty. Lopez-Rosario Lectures
who have the right to retain possession of the
property until reimbursement by respondent.
We affirm the ruling of the CA that introduction
of valuable improvements on the leased
premises does not give the petitioners the
right of retention and reimbursement which
rightfully belongs to a builder in good faith.
Otherwise, such a situation would allow the
lessee to easily "improve" the lessor out of its
property. We reiterate the doctrine that a lessee
12
is neither a builder in good faith nor in bad faith
that would call for the application of Articles 448
and 546 of the Civil Code.
Under Article 1678, the lessor has the option
of paying one-half of the value of the
improvements which the lessee made in
good faith, which are suitable for the use for
which the lease is intended, and which have
not altered the form and substance of the
land. On the other hand, the lessee may
remove the improvements should the lessor
refuse to reimburse.”
Arangote vs. Sps. Maglunob
“Petitioner cannot be entitled to the rights under
Articles 448 and 546 of the Civil Code, because
the rights mentioned therein are applicable only
to builders in good faith and not to possessors in
good faith.
Moreover, the petitioner cannot be considered a
builder in good faith of the house on the subject
property. In the context that such term is used
in particular reference to Article 448 of the Civil
Code, a builder in good faith is one who, not
being the owner of the land, builds on that
land, believing himself to be its owner and
unaware of any defect in his title or mode of
acquisition.
…the builder in good faith can compel the
landowner to make a choice between
appropriating the building by paying the proper
indemnity or obliging the builder to pay the price
of the land. The choice belongs to the owner of
the land, a rule that accords with the principle of
accession, i.e., that the accessory follows the
principal and not the other way around. Even as
the option lies with the landowner, the grant to
him, nevertheless, is preclusive. He must
choose one. He cannot, for instance, compel
the owner of the building to instead remove it
14
Property Notes A.Y. 2011-2012
from the land. In order, however, that the
builder can invoke that accruing benefit and
enjoy his corresponding right to demand that a
choice be made by the landowner, he should be
able to prove good faith on his part.”
2.2. Accession Natural - by nature
Involves:
 Alluvium -A
 Avulsion - A
 Uprooted trees - U
 Abandoned river beds - A
Q. How come they are called accession
natural?
A. Because w/o human intervention something
is added/attached to the property.
Example: beach - seashore
-watch the movement of water, the
sediments upon the movement of H2O it will
either be washed away or it will stick to the
sand.
Q. How did the alluvium / avulsion take
place?
A. Those sediments that accumulated on the
seashore due to the force of the water.
Q. Who now owns the sediment?
A. Owner of the property where the sediments
accumulated. Under the provisions of property,
specifically alluvium:
Alluvium- small particles of soil are
being washed away by the movement of H2O
w/out the owner of the real property knowing it.
-real property must be located near the
river
-There is an increase in the area of
owner’s property, that increase is due to
alluvium - not identifiable w/ that of real property
 In relation to Land Registration Act
Even if the civil code says that
the owner of the real property, where all those
particles are gradually deposited & attached can
make owners ship through it, LR Act says that a
resurvey must be done to include it in the
technical description
*intention of the law: not only 1 grain of
sediment, those accumulated sediments
*it is different if what is attached to the real
property is an identifiable portion of a real
Atty. Lopez-Rosario Lectures
property that is detached from a neighboring
property.
*it will only apply if you were near a
river/body of water
 applies in the province, if you want to
increase your land, buy a land near a
body of water (this is what the law says)
Remember:
Alluvium = not identifiable
 refers to small particles of soil
accumulated into a greater mass.
 not painful on the part of the original
owner who lost a part of land
Avulsion - with force
 refers to an identifiable portion of a real
property that was detached from?
Neighboring property by the force of
H2O, is now moved to your real property
 delayed accession
Art. 459. Whenever the current of a river, creek or
torrent segregates from an estate on its bank a known
portion of land and transfers it to another estate, the
owner of the land to which the segregated portion
belonged retains the ownership of it, provided that he
removes the same within two years.
Reason: the owner of the real property where
that identifiable portion has been separated
has the right to claim it within 2 years. Once
2 years has lapsed, the owner of the
neighboring property where the identifiable
portion is now attached, can fully claim
ownership, it can now be a notice to the
world subject to resurvey to include it in the
technical description in your title.
ALLUVIUM AVULSION
deposit of soil is gradual sudden or abrupt
process
unidentifiable identifiable
belongs to owner of belongs to owner from
property to which it is whose property it was
attached detached
“malumay” = gradual “maragsa” = with force
15
Property Notes A.Y. 2011-2012
Uprooted Trees
Art. 460. Trees uprooted and carried away by the
current of the waters belong to the owner of the
land upon which they may be cast, if the owners do
not claim them within six months. If such owners
claim them, they shall pay the expenses incurred in
gathering them or putting them in a safe place.
- -owner of real property where the
uprooted tree can now be found cannot
claim ownership
- -original owner of the uprooted tree is
given 6 months from the time it is
uprooted
- -in the province, they convert it into
furniture
- Delayed accession because of 6 month
period given to owner to redeem the
tree
River beds abandoned through natural
change in course of the water
Art. 461. River beds which are abandoned through the
natural change in the course of the waters ipso facto
belong to the owners whose lands are occupied by
the new course in proportion to the area lost.
However, the owners of the lands adjoining the old
bed shall have the right to acquire the same by paying
the value thereof, which value shall not exceed the
value of the area occupied by the new bed.
- -applies in the province
- -not applicable in Manila (canal is not a
river bed)
- -natural change in course “biglang liko”
due to it, the abandoned river bed is
now the subtitle of the area affected by
the natural change in course
“EXCHANGE DEAL”
-
Reason: For being fair, even if it is very far,
abandoned part will be an exchange of the
area affected. PRINCIPLE OF UNJUST
ENRICHMENT!
Atty. Lopez-Rosario Lectures
Formation of Islands
Art. 464. Islands which may be formed on the seas within
the jurisdiction of the Philippines, on lakes, and on
navigable or floatable rivers belong to the State. (371a)
Art. 465. Islands which through successive accumulation
of alluvial deposits are formed in non-navigable and non-
floatable rivers, belong to the owners of the margins or
banks nearest to each of them, or to the owners of both
margins if the island is in the middle of the river, in which
case it shall be divided longitudinally in halves. If a single
island thus formed be more distant from one margin than
from the other, the owner of the nearer margin shall be
the sole owner thereof.
Q: Juan has property near a body of water, 2
years after an island was formed near
property of Juan. Can Juan claim ownership
over the island?
A: It depends if the body of water is:
Navigable - Absolutely No!!! Remember
the “regalian doctrine”?!? Right of way of boats
and ferries.
Non-navigable - depends again if:
a. Nearer to Juan’s property, he is the SOLE
owner
b. If equidistant or the island is located at the
center - by operation of law, CO-OWNERSHIP
will apply.
1. Formed by the sea:
a) within territorial waters - STATE
b) outside territorial waters - FIRST
OCCUPANT
2. Formed in lakes or navigable or floatable
rivers - STATE
3. Formed in non-navigable or non-floatable
rivers:
a) equidistant from both banks
(measured from the islands’ margins) - to the
riparian owners by half (co-ownership)
b) nearer one margin or bank - to the
nearer riparian owner.
Riparian Owner - owner of land located on the
bank of a river or stream (or occasionally
another body of water, such as a lake)
Littoral - relating to the coast or shore of an
ocean, sea or lake
16
Property Notes A.Y. 2011-2012
CASES
Government of P.I. vs. Cabangis
“As the lots in question (near Manila Bay)
disappeared by natural erosion due to the ebb
and flow of the tide, and as they remained in that
condition until reclaimed from the sea by the
filling in done by the Government, they belong to
the public domain for public use.”
Siain Enterprises Inc. vs. F.F. Cruz and Co.
“The DENR Secretary found that the disputed
area is a “natural foreshore,” hence, it concluded
that SIAIN, being a littoral owner (owner of land
bordering the sea or lake or other tidal waters),
has preferential right to lease it as provided in
paragraph 32 of Lands Administrative Order No.
7-1 dated April 30, 1936 which reads:
32. Preference of Riparian Owner. – The owner
of the property adjoining foreshore lands or
lands covered with water bordering upon
shores or banks of navigable lakes or rivers,
shall be given preference to apply for such
lands adjoining his property as may not be
needed for the public service, subject to the laws
and regulations governing lands of this nature,
provided that he applies therefore within sixty
(60) days from the date he receives a
communication from the Director of Lands
advising him of his preferential right
That rule in paragraph 32 is in
consonance with article 4 of the Spanish Law of
Waters of 1866 which provides that, while lands
added to the shores by accretions and alluvial
deposits caused by the action of the sea form
part of the public domain, such lands, when
they are no longer washed by the waters of the
sea are not necessary for purposes of public
utility, or for the establishment of special
industries, or for the coast guard service,” shall
be declared by the Government “to be the
property of the owners of the estates adjacent
thereto and as increment thereof.”
In other words, article 4 recognizes
the preferential right of the littoral (riparian
according to paragraph 32) to the foreshore
land formed by accretions or alluvial
deposits due to the action of the sea.
That the foreshore area had been reclaimed
does not remove it from its classification of
Atty. Lopez-Rosario Lectures
foreshore area subject to the preferential right to
lease of the littoral owner.
It bears noting that it was not the
reclamation that brought the disputed foreshore
area into existence. Such foreshore area
existed even before F.F. Cruz undertook its
reclamation. It was “formed by accretions or
alluvial deposits due to the action of the sea.”
Following Santulan, the littoral owner has
preferential right to lease the same.”
With Respect to PERSONAL PROPERTY
 There is Accession if it will cause injury
to property, if no injury it is only
accessory.
Example: pair of glasses - it is composed of
several properties merged together
Frame, glass/lens, nose pad, rubber
Q: If one is removed from the other, what will
happen?
A: In accession, personal properties are put
together, once there is an attempt to remove
another, it will cause injury or destruction to the
thing. In the example, if the glass/lens are
removed from the frame, it will cause injury to
the frame/glasses then there is accession.
Kinds of Accession In Personal Property
1. conjunction/ adjunction
2. conmixtion
3. specification
CONJUNCTION/ADJUNCTION
- The union of materials belonging to
different owners making up a new
thing.
- Separation being impossible without
injury.
Elements of Adjunction/Conjunction:
1. Two personal properties put together
2. removal of which will cause injury or
destruction
3. retains the identity of the separate personal
properties.
In the example given, the identity of the frame
remains separate and distinct from the identity of
the lens.
17
Property Notes A.Y. 2011-2012
Q: If the owner of the frame is different from
the owner of the lens, who owns the
eyeglass?
A: To answer this question, you have to be very
intelligent…
Determine always what is the principal and what
is the accessory… remember our principle,
ACCESSORY FOLLOWS THE PRINCIPAL.
If you cannot determine which is the principal
and which is the accessory, then apply:
4 RULES (apply chronologically!)
1. Rule of Importance
2. Rule of Greater Value
3. Rule of Greater Volume
4. Rule of Greater Merit
Rule of Importance
Gen. Rule: The owner of the more important
personal property is the owner of the whole
thing.
XPN: 1. Both in Good Faith
- In the example, if the value of the
frame is higher than the lens, the
owner of the frame has the right to
demand separation (if slight injury,
no problem)
2. Owner of Principal in Bad Faith
- always liable for damages
- Owner of accessory in good faith
can demand separation even if it will
cause destruction, not just simple
injury.
3. Owner of Accessory in Bad Faith
- Liable for damges
- Losses property and will go to
owner of principal as adjunction
4. Good faith/ Bad Faith not mentioned
- Qualify
Other examples in adjunction (importance):
1. jewelries
2. watch
3. button in polos
4. zipper
5. car engine and car key
Rule of Greater Value
Examples:
1. wristwatch - watch is more valuable than
leather band
2. diamond ring - diamond more valuable than
gold band
Atty. Lopez-Rosario Lectures
Rule of Greater Volume
- Apply if the two properties have the same
value
Rule of Merit or Sentimental Value
- that of greater merits, taking into
consideration all the pertinent legal provisions
NOTA BENE:
Art. 469. Whenever the things united can be
separated without injury, their respective owners
may demand their separation.
Nevertheless, in case the thing united for the use,
embellishment or perfection of the other, is much
more precious than the principal thing, the owner of
the former may demand its separation, even though
the thing to which it has been incorporated may
suffer some injury.
Gen. Rule is ACCESSORY FOLLOWS THE
PRINCIPAL (GOOD FAITH ON BOTH
OWNERS)
XPN: When accessory is much more precious
than the principal, in which case the owner of
the accessory may demand the separation
even if the principal suffers some injury NOT
destruction.
OWNER OF PRINCIPAL IN BAD FAITH:
Owner of the accessory has the option:
a) to recover damages OR
b) to demand separation even to the
extent of destroying the principal + damges
Art. 470. (par.2)
If the one who has acted in bad faith is the owner of
the principal thing, the owner of the accessory thing
shall have a right to choose between the former paying
him its value or that the thing belonging to him be
separated, even though for this purpose it be necessary
to destroy the principal thing; and in both cases,
furthermore, there shall be indemnity for damages.
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Property Notes A.Y. 2011-2012
OWNER OF ACCESSORY IN BAD FAITH:
Losses accessory and liable for
damages
Art. 470. (par.1) Whenever the owner of the accessory
thing has made the incorporation in bad faith, he shall
lose the thing incorporated and shall have the
obligation to indemnify the owner of the principal thing
for the damages he may have suffered.
MIXTURE (conmixtion or confusion)
- Union of materials were the
components lose their identity
- Results to CO-OWNERSHIP
- Separation of property is NOT
possible, no principal/ accessory
1. conmixtion - mixture of two solids
Example: cement + sand
2. confusion - mixture of two liquids
Example: water + chlorine
Vinegar + soy sauce
 Solid + Liquid = water + coffee
 Adjunction - the identity of the 2 properties
is separate and distinct
 Mixture - the identity of the 2 properties will
disappear
Q: Who will own the water mixed with the
coffee?
A: It DEPENDS! If by accident (good faith) co-
ownership will apply.
If intentional (bad faith), owner in bad faith will
lose right to his own material + liable for
damages.
SPECIFICATION:
- It is the transformation of another’s
material by the application of labor.
- The material becomes a thing of a
different kind.
- HUMAN LABOR is deemed to be
the principal
- Identity of the personal property is
transferred to another due to human
intervention
Example: pants and jacket
- Cannot be immediately produced.
These were transformed originally
from a piece of cloth, the cloth
Atty. Lopez-Rosario Lectures
originally from cotton, cotton
originally from a tree.
Pants/Jacket = accessory
Labor (man) = principal, without it such
property cannot change into another
Art. 474. One who in good faith employs the material of
another in whole or in part in order to make a thing of a
different kind, shall appropriate the thing thus
transformed as his own, indemnifying the owner of the
material for its value.
If the material is more precious than the transformed thing
or is of more value, its owner may, at his option,
appropriate the new thing to himself, after first paying
indemnity for the value of the work, or demand indemnity
for the material.
If in the making of the thing bad faith intervened, the
owner of the material shall have the right to appropriate
the work to himself without paying anything to the maker,
or to demand of the latter that he indemnify him for the
value of the material and the damages he may have
suffered. However, the owner of the material cannot
appropriate the work in case the value of the latter, for
artistic or scientific reasons, is considerably more than that
of the material.
RULES:
1. Owner of Principal in Good Faith:
Gen. Rule: Maker acquires the new
thing and indemnify owner of material (unjust
enrichment)
XPN: if the value of the material is
greater than value of labor, owner of material
has option:
a) to acquire the property + indemnify
for labor OR
b) demand indemnity for material
2. Owner of Principal in Bad Faith
Owner of material has option:
a) acquire the result without indemnity
(due to impossibility of separation) OR
b) indemnity for the material + damages
3. Owner of Material in Bad Faith
- loses material and must pay damages.
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Property Notes A.Y. 2011-2012
IV. Quieting of Title
 Purpose: Restoration
 “Accion que teinet”
 An equitable action in rem to determine
the condition of the ownership or the
rights to immovable property and
remove doubts thereon
 A cloud on title is a semblance of title
 A cloud on title exists when there is an
instrument, record, claim, encumbrance
or proceeding which is apparently valid
or effective, such instrument is in truth
and in fact invalid, ineffective, voidable
or unenforceable or has been
extinguished by prescription.
 Action does not prescribe
 Plaintiff must have legal or equitable
title but need not be in possession of
the property (Art. 477)
 Procedural remedy
 There should be an instrument or
document involved
 No rule in civil procedure and special
proceedings, therefore, sabi ni Mam
LR, it is a DECLARATORY RELIEF
Q: What if there is doubt on title?
A: Proper remedy is to quiet title
Q: Is there a prescriptive period for action of
quieting?
A: It depends
- If plaintiff in possession, action does not
prescribe
- If plaintiff not in possession – prescribes
a) Good faith = 10 years
b) Bad faith = 30 years
Indispensable requisite which must
be present so that you can file an
action to quiet:
 Possessor has
legal/equitable title
 Not necessary that he is
in possession
Legal – registered owner
Equitable – Beneficiary
Deed/ Instrument must be shown to be
invalid and operative
 There must be evidence to prove
Atty. Lopez-Rosario Lectures
Direct attack – main action/central issue
In the Family Code:
Nullity of Marriage – can be attacked
directly/collaterally.
Collaterally – possible for settlement.
Annulment of marriage – cannot be
attacked collaterally, must be direct.You
need to file a petition for annulment.
Leyson vs. Bontuyan
SC: Action for reconveyance prescribes in 10
years if claimants are not in possession.
If in possession = It does not prescribe.
Q: Who can file?
A: The plaintiff must have a legal or equitable
title to, or interest in the property subject of the
action. He need not be in possession of the
property.
V. Co-ownership
 Created by law or by agreement
 Plurality of parties, like in a
Corporation except corporation sole
 Not a juridical person
 The law says spiritual share
meaning you cannot identify where
is your exact share. If the specific
share is identifiable then the co-
ownership is extinguished.
Art. 484. – the right of common dominion which
2 or more persons have in a spiritual part of a
thing which is not physically divided.
a) Hidden treasure (chance) –no problem if
the property can be divided physically.
- If it cannot be divided physically,
automatically there is co-ownership.
b) By Succession - only 1 property left and
several compulsory heirs
- Upon death of decedent compulsory
heirs automatically become co-owners.
c) Property Relationship – between
common law spouses 147 and 148 of
the FC.
20
Property Notes A.Y. 2011-2012 Atty. Lopez-Rosario Lectures

Co-ownership Partnership Lopez vs. Ilustre

A co-owner has the right to freely sell
Co-Ownership Partnership and dispose of his undivided interest, but no
Created by other Created by contract right to sell a divided/definite part of the real
sources besides except conjugal estate.
contract partnership
No juridical personality Has juridical Cruz vs. CA
personality Co-ownership is terminated if there is
Purpose: Common Purpose: Profit judicial or extra-judicial partition of property.
enjoyment
May not stipulate May be for more than Avila vs. Sps. Arabat
indivision for more than 10 years Any act intended to put an end to
10 years but 20 years if division is deemed to be PARTITION. Heirs took
imposed by possession of respective share and constructed
testator/donor respective houses. Co-ownership is legally
Not dissolved by death Dissolved by death of dissolved and right of redemption cannot
of co-owner partner anymore be exercised.

Q: Can a co-owner file an action for

Example:
1. Law office through partnership
- Can enter into transaction with any
person
2. Co-owner of property
- Cannot enter into transaction
- No juridical capacity
Remedy: Co-owner will have to enter
rd
into particular transaction with 3 person
3. Partnership: 1 dies = partnership is
terminated
Co-ownership: 1 dies, will not
dissolved the co-ownership.
Q: Is there perpetual co-ownership?
A: No. Any co-owner can demand partition of
ownership at any time.
Basis: Patricio vs Dario III
 No co-owner ought to be compelled to
stay in a co-ownership indefinitely.
 Co-owner may insist on partition of the
property at any time.
 An action to demand partition does not
prescribe
If there is agreement on co-ownership, can
continue for a maximum of 10 years.
If a co-owner wants to sell the property it
must be with a unanimous consent.
ejectment against another co-owner?
A: Yes, ejectment is only about physical or
material possession. If it is beneficial to the other
co-owners, action for ejectment will prosper. (De
Guia vs CA)
De Guia vs. CA
SC: Co-owner may file an action for
ejectment under Art. 487. Not only as against a
third person but also against a co-owner who
takes exclusive possession and asserts
exclusive ownership of the property (no consent
necessary).
Q: Is it possible to acquire undivided interest
of co-owner by prescription?
A: Yes, SC in Sta. Ana Vs. Panlasigue
GR: Co-owner cannot acquire by acquisitive
prescription the undivided share.
XPN: Unless there is an explicit repudiation
of that share coming from a co-owner.
- But if that co-owner did not repudiate
his share, there can be NO acquisitive
prescription.
Heirs of Cabal vs Cabal
Co-ownership will not exist if a portion
owned is completely determined or specified by
its very nature.
Every co-owner owns an undivided
interest and you cannot pinpoint where that
property co-owned is an undivided interest.

21
Property Notes A.Y. 2011-2012
Sources of Co-ownership:
1. Law –
a. common law spouses (Art. 147-148 FC)
b. commixtion/confusion - generally will result to
co-ownership, subject to the xpns
c. Hidden Treasure
d. Formation of islands – if equidistant = co-
ownership
(in all the above circumstances, co-
ownership is created by operation of law)
2. Contract
3. Succession
4. Chance
5. Occupation - hunting/fishing
Consent of Majority of interest in a co-
onwership
 E - Enjoyment
 M –Management
 I – Improvement (Art. 489)
Unanimous Consent:
 E - Emcumbrance (Mortgage)
 D – Disposition of entire property
(Sale/Donation)
 A – Alteration of thing owned in common
(Art. 491)
In relation to expenses:
Necessary Expenses: Art. 488
Q: Does co-owner have the right for
reimbursement?
A: Yes, because it is beneficial to all co-owners.
But the law says it would be better to notify in
advance .No consent needed
Q: What if the other co-owners still does not
pay?
A: Co-owner may compel the other co-owner to
pay. If the other co-owner renounced his
undivided share, that share will be considered
as payment for the necessary expenses
incurred. “Dacion en Pago”.
Useful and Luxury Expenses
- If no consent, that co-owner who
introduced wil be solely responsible for
it.
Atty. Lopez-Rosario Lectures
Causes for extinction of co-ownership:
1. Total destruction of the thing
2. Merger of all interest into one person
3. Prescription (adverse possession)
rd
- By a 3 person or one co-owner (open and
adverse)
4. Partition – judicial/extrajudicial
GR: Maybe asked at anytime
XPN: When there is stipulation against
it. Condition imposed by transferor; legal nature
prevents partition; prohibited by law; partition
would render the thing unserviceable.
Basis: Figuracion – Gerilla vs Vda. De
Figuracion
Premature to partition a property that is
co-owned if ownership of property is still in
dispute/remains in issue as to expenses.
Condominium Act: RA 4726 – June 19, 1966
Reason for the law : the proliferation of condos
in the Philippines
Sec. 2 – Condominium
- An interest in real property consisting of
separate interest in a unit in a residential,
industrial or commercial building and an
undivided interest in common, directly or
indirectly, in the land on which it is located and
in other common areas of the building.
*Indispensable requirement: All incorporators of
condo corp. Must be shareholders thereof.
Shareholders - owner of condo unit.
*There are areas in the condo that are co-
owned, example:
- stairs, elevator, gym etc…
*Your unit is yours exclusively but you have no
right to make changes outside your unit.
*the higher the unit, the more expensive it is.
Why? Because dear reader, there is less
disturbance.
*the lower the unit, the cheaper it is. Why?
Because dear reader, there is more disturbance.
You have to endure the fact that people from the
higher unit will pass by your unit (corridor) every
day to get out of the condo. Your location is
more prone to being used because of the
COMMON AREAS! Gets?!? (very good! Now we
proceed to the next topic.)
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 Property Notes A.Y. 2011-2012 Atty. Lopez-Rosario Lectures

VI. Possession Ways of Acquiring Possession:

- Material holding or control of a thing 1. Material Occupancy – includes constructive
(Possession proper) delivery.
- Exercise of a right (quasi-possession)
- Holding of a thing or of a right whether by  Traditio Brevi Manu (TBM) –
material occupation or by the fact that the transferee already had the property in
thing or right is subjected to the action of our his possession for any other reason.
will. Ex. Juan, lessee of property of Maria, decides
to buy the property upon hearing that Maria
Possession in Property – does not intends to sell it. After buying the property, Juan
automatically refer to actual physical continues/ remains to be in possession of the
possession, because there is such a thing as: property - from lessee to owner.
a) Possession in the concept of holder
b) Possession in the concept of owner  Constitutum Possessorium
(CP) – take place when the owner of the
Example: property alienates it but continues to be
Lessee – possession in the concept of holder. in possession in the concept of a tenant
Lessor – although not in the actual possession, or other subordinate right =
in the concept of holder of a right. Possession lessee/usufruct.
in concept of owner. Ex. Owner sells property to another person
subject to the condition that he is allowed to
Jus Possidendi continue to possess the property.
- The right to possess
- Right exercised by the owner of the property. 2. By the subjection to the action of our will
according to law even without physical
Different Types of Credit Transactions seizure
1. Commodatum
2. Usufruct  Tradicion Symbolica (TS) –
3. Antichresis delivery of the keys of the place or
4. Lease – Lessee – holder depository where the thing is stored or
Lessor – owner kept.
rd
*Right of possession is transferred to a 3 OBLICON – contract of sale
person but not the other rights of an owner. Stages: 1. Preparation
2. Perfection
Q: What can be objects of possession? 3. Consummation
A: Only things and rights susceptible of - Real property by nature that cannot be
appropriation actually transferred or delivered.
Res Nullius – Nobody owns them so - The only way to deliver it is through symbols.
you cannot be charged of robbery. Ex. Delivery of a title or key – no actual
Res Alicujus – unless in relation to transfer of object.
different kinds of transactions, owner delvers
rd
possession to a 3 person which shows that  Traditio Longa Manu (TLM) –
the object is not res nullius, subject that there is thing cannot be manually transferred to
consent in the transfer of the possession. the transferee at the time of agreement
but there is no legal obstacle to the
Q: What are excluded? transfer of possession.
A: Res Communes Q: Is tradition longa manu applicable in
Property of Public Dominion REAL property or is it limited to personal
Discontinuous Servitudes property only?
Non-apparent- servitudes. A: It is limited to personal property only
because if you are just pointing to a parcel of
land, how will you be able to identify the lot
area? In the sale of land, there must be a
survey to properly identify the meets and
bounds of the lot, therefore TLM not applicable.

23
 Property Notes A.Y. 2011-2012 Atty. Lopez-Rosario Lectures

3. By proper acts and legal formalities Q: What if there is a dispute between 2

 Clandestine possession – persons regarding possession of property?
hidden or disguised, as distinguished A: Rules:
from open or public possession. 1) Preference, shall be given to
 Possession by tolerance – one in actual possession – the law
does not give rise to ownership. presumes that if you are in
Ex. Squatter (Informal Settlers) living in possession you are the owner.
Rizal Park. 2) If 2 or more possessors –
Oldest or Longer possessor
 Acts merely tolerated, and those executed 3) If the same, the one who can
clandestinely and without knowledge of the show title
possessor of a thing or by violence, do not *If all conditions are equal, determined in
affect possession. (Art. 537) proper proceedings (Art. 538).
 *Rule #1-3 must first be resorted to before
Ex. Public Dominion – cannot be acquired by going to Rule # 4.
acquisitive prescription. It cannot ripen into
ownership. Different kinds of action to recover
possession of real property:
Right of Possession ≠ Right to Possession 1) Summary (Accion Interdictal)
- Forcible Entry
Jus Possessionis Jus Possidendi - MTC
Right of possession is Right to possession
independent and apart is a mere incident of  Sampayan vs. CA
from ownership ownership SC: In an action for forcible entry,
Who enjoys? : Who Enjoys? : plaintiff must prove that he was in
- - Usufructuary previous possession of the land/building
- -Bailiee in and he was deprived thereof by means
Commodatum of fraud, intimidation, threat, strategy
- -Pledgee or stealth (FISTS). Absence of prior
- -Lessee physical/actual possession by plaintiff
warrants the dismissal of his complaint.
Possession with juridical title ≠ Complainant must prove that:
Possession with just title 1. he is in ACTUAL possession
Possession with Possession with 2. he is deprived of possession through
FISTS
Juridical Title Just Title
- Predicated on a- Possession of an
2) Unlawful detainer – originally defendant was
juridical relation adverse claimant
in lawful possession of property, however,
existing between the whose title is
because of expiration of the period that has
possessor and the sufficient to transfer
been leased/violation/breach of conditions
owner of the thing but ownership but is
stipulated, possession of that defendant
not in the concept of defective as when
becomes unlawful.
owner, such as that of the seller is not the
Steps:
lease, usufructuary, true owner.
1) Demand for defendant to vacate
depositary etc.
premises (15-30 days)
- Connect with right of- Connect with right 2) Letter must be given which was
possession to possession
made by a lawyer for an action of unlawful
- Refers to owner of detainer.
Ex.Usufructuary, property Ocampo vs. Tiroma
Depositary, pledge,
SC: Elements to be proved in unlawful
lessee – in possession
detainer:
but not in the concept
1. There was lawful possession first - this
of an owner.
may be in a lease or usufruct
2. The contract is expired already or there
was a violation of the contract.

24
 Property Notes A.Y. 2011-2012 Atty. Lopez-Rosario Lectures

Remedies: - Art. 1678 – allows reimbursement of lessees up

- Recovery of possession to ½ of the value of their improvements if the
- Accion Publiciana – Issue: Possession lessor elects.
- Accion Reinvidicatoria – Issue: Ownership
- RTC Possessor in Good Faith
 Oblicon: For a person to be in default, you must Art. 546 – entitled to demand
make a demand. necessary expenses.
- Within 1 year from the date of?
- Answer: Demand to vacate the premises Right of Retention
- Injunction, against continuation of trespass Sps. Nuguid vs. CA
Under Art. 448, the owner is given the option:
Q: What is the proper remedy to get rid of a) To appropriate the improvement
informal settlers? as his own upon payment of the proper
A: Demand first that they should vacate the amount of indemnity; or
property. Then 1 year from date of demand to b) To sell the land to the possessor
vacate if still stubborn, file accion publiciana in in good faith
the RTC. Relatedly, Art. 546 provides:
 “that a builder in good faith is entitled to full
Q: What if property is not real but personal? reimbursement for all necessary and useful
A: File an action for REPLEVIN. expenses incurred”.
Replevin : Go back to Art. 415 – real/personal  “Also gives builder/possessor in good faith
property. the right of retention until full
reimbursement is made”.
Proper action for recovery of personal property
- Rule 60 ROC Kinds of Action to Recover Possession of
Real Property
Q: What is the principle of Irrevindicability? 1) Summons – (Accion Interdictal) – forcible
Art. 559 entry/unlawful detainer.
A: General Rule – Under acquisitive - MTC
prescription; if you are in possession of
property in good faith, you can acquire it after 2) Accion Publiciana – action for the recovery of
10 years. possession.
- If you are in possession of a movable/personal - Based on superior right of plaintiff to
property and you acquired it in good faith, possession (in concept of holder)
acquisition of which is equivalent to a just title. - RTC
Ex. - Issue: On possession NOT ownership
1) If owner of that property lost it
- No finders keepers under the civil code. It 3) Accion Reinvindicatoria – Issue: Based on
should be surrendered to proper authorities. ownership
- Connect with modes of acquiring. - RTC
2) If owner has been illegally deprived of it
 Under Criminal Law – Antifencing Act. 4) Injunction – against continuation of trespass.

Jimenez vs. Patricia 5) Interpleader – a suit to determine a right to

- Lessees, much less sub-lessees are not
possessors or builders in good faith over rented
land because they know that their occupancy of
the premises continues only during the life of
the lease or sublease as the case may be.
- They cannot as a matter of right recover the
value of their improvements from the lessor,
much less retain the premises until they are
reimbursed.
rd
property held by a disinterested 3 party, who
is in doubt about the ownership and who
therefore deposits the property with the Court
to permit interested parties to litigate
ownership.
- Purpose:
1) Who should receive property;
2) avoid multiple liabilities.

25
Property Notes A.Y. 2011-2012
VII. Usufruct
- 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.
- “uso” – use
- “fructo” – fruits/enjoy
- A real right (of a temporary nature)
- May involve real or personal property.
Usufruct ≠ Lease ≠ Commodatum
Distinction: “right to enjoy fruits”
Lease: Rights:
1. Possess
2. Use
3. Enjoy – it depends, if there is
express prohibition against a
sublease, then no right to enjoy the
fruits.
- If allowed, lessee can
sublease property, hence
can enjoy the fruits.
- b) To prevent abuse w/c is
Parties: Lessor and Lessee
Usufruct: Rights:
1. Possess
2. Use
3. Enjoy
Parties: Naker owner and Usufructuary.
Commodatum: Rights:
1. Possess
2. Use
3. No transfer of right to enjoy
Parties: Bailor and Bailee
Object: real/personal; sterile/productive;
may be rented as a right.
Q: Is there consideration involved in
Usufruct? Lease? Commodatum?
A: 1. Lease – there is consideration.
- “rentals”
- Lessee cannot sublease
without the consent of
lessor – Rental Law
2. Commodatum – essentially gratuitious
3. Usufruct – civil code is silent.
Accdg. To Castan - 1890 Spanish Civil Code
- Provision of property was retained
unlike in FC (marriage)
Atty. Lopez-Rosario Lectures
- There can be considerationMay be
gratuitous/onerous
Characteristics/Elements:
A. Essential – without which it is not a
usufruct.
1) Real right
2) Temporary in nature
3) Purpose: To enjoy the benefits
B. Natural – ordinarily is absent
- GR: to preserve it
- XPN: when the title/law provides that it
is OK not to preserve.
C. Accidental
Difference between Usufruct ≠ Lease
 Lease – consideration is regular,
weekly, monthly
 Usufruct – consideration is only ONCE,
not a regular basis
Reason:
a) To prevent exploitation
frequent
c) To prevent impairment
Q: May a usufructuary lease the object?
A: NHA vs CA – Art. 565, 572
- Usufructuary may lease the object, has
the right to enjoy the fruits
- Has the right to choose tenants
- Usufructuary allowed to administer and
manage the property
-
Q: What happens to the contract of lease
entered into by the usufructuary in relation
to the stipulated period agreed upon by the
naked owner and usufructuary?
A: The lease contract entered into by the
rd
usufructuary with a 3 person will be terminated
upon the termination of the contract of usufruct.
- Upon termination of usufruct, it is also
termination of contract of lease.
- Usufructuary/heirs/succession
Similar analogy shall only recover
proportionate share of the rent.
 If lessee sublease the property under
lease, original contract of lease is
terminated, the sublease contract
automatically terminated.
26
Property Notes A.Y. 2011-2012
Q: Can money be an object of usufruct?
A: Yes. Alunan vs. Veloso
- Money is a consumable because you
will not be able to return the same
money bearing the same serial number
that was given by the naked owner, but
there can still be a usufruct, this is called
abnormal usufruct.
- Quasi-usufruct
- Because it refers to a usufruct wherein
the object is a consumable property.
- More of an exception, because the
nature of the usufruct, it is the obligation
of the usufructuary upon the termnation
of the usufruct that he will deliver back
the same property that he received in
the same condition.
Q: What will be returned/delivered back?
A: The appraised value so the usufructuary
will now have to pay the appraised value of
that consumable property that was used and
enjoyed by the usufructuary. The appraised
value could be the current value from the
time the usufruct ceases.
- Connect with Art. 547.
- In relation to hidden treasure: HT
discovered by the a usufructuary on the
property under usufruct, it is by chance,
to the owner of that object considered
as a stranger therefore he is entitled to
½ of the hidden treasure, other half
belongs to the owner.
- In relation to expenses:
- Necessary – usufructuary may
demand reimbursement because it
will redound to the benefit of the
owner.
- Ordinary – usufructuary will
shoulder
- Extraordinary – souldered by the
naked owner.
- - Take care of the thing as a good father
Q: What are the obligations of a usufructuary
before entering upon the enjoyment of
property?
A: 1. To make an inventory of all the property;
2. To give a security
Reason: the law wants to protect the interest of
the naked owner considering that the
possession, right to use and enjoy the fruits are
entrusted to the usufructuary.
 Growing crops – goes to the naked
owner, reimburse the usufructuary.
Atty. Lopez-Rosario Lectures
If naked owner is insolvent, usufructuary
may recover fruits from naked owner –
dation.
 The abovementioned obligations are
connected with the obligation of the
usufructuary to return the object under
the same condition when it was
delivered to him. That is why before he
enters the property he has to give an
inventory of the property at the same
time a security.
Q: Is it possible that a usufructuary can still
take possession of the property without
giving a security?
A: Yes, in lien of that, what he can give is a
caucion juratoria.
Caucion Juratoria – an undertaking, an oath,
“palabra de onor”.
- Bond by oath if usufructuary cannot give
a security.
Q: What if there is refusal of giving security/
caucion juratoria? What are the remedies of
the naked owner?
A: Remedies:
 Ask for the administration of the
property, instead of giving it to the
usufructuary, in which case it would
defeat the purpose of the usufruct. It is
one way to pressure the usufructuary to
either give the security/ if not a caucion
juratoria.
 Death of usufructuary may create doubt
as to who is the owner, put a provision
in the contract.
OBLIGATION OF A USUFRUCTUARY
DURING THE EXISTENCE OF A
USUFRUCT
- To make an inventory of the property to
protect the naked owner
of a family
- Give a bond/security – cash/surety
- Make ordinary repairs at his expense.
Extraordinary expense – owner.
- Pay taxes and charges
- Notify owner of urgent need for
extraordinary repairs (Art. 593) and acts
detrimental to ownership (Art. 601)
- Bear cost of litigation over the usufruct
(Art. 602)
- Answer for fault of lessee/agent
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Property Notes A.Y. 2011-2012
Ordinary diligence - in OBLICON Art. 1163 –
ordinary diligence of a good father of a family is
required in ordinary contracts.
- In usufruct – (contract of Usufruct) same
diligence is required because it is
incumbent upon the usufructuary to
preserve the property in its condition
when it was delivered to him.
To shoulder all ordinary expenses
- Under the provisions in usufruct, the law
uses the terms ordinary expenses and
extraordinary expenses
Q: Why not useful and necessary?
A: The definition of extraordinary expenses
pertains to the repairs needed to restore the
property in its original condition, more or less it
is similar to that of a necessary expense.
- It is the same sole responsibility of the
usufructuary to shoulder the ordinary
expenses because he is the one in
possession of the property.
- Ordinary expenses = expenses incurred
through the ordinary wear and tear of
the property.
Q: Who will shoulder the extraordinary
expenses?
A: The naked owner because he will be the one
who will be benefited.
- If the usufruct would advance the
extraordinary expenses, he has the right
to demand for reimbursement from the
naked owner.
Causes for Extinguishment of Usufruct:
- Waiver
- Expiration/loss of property
- Resolution/termination of the right to
constitute usufruct
- Expropriation
- Prescription
- Merger
- Expiration of period/fulfilment of the
resolutory condition
- Death
-
Q: Can a usufructuary alienate his rights to
the usufruct?
A: Yes. He can alienate his right to the
usufructuary. In accordance with Art. 577.
Atty. Lopez-Rosario Lectures
Obligations of a usufructuary at the
expiration of the usufruct
1. To return the property unless there is
right of retention = extraordinary
expenses
2. To pay interest or the amount spent by
the owner of extraordinary repairs (Art.
594) or taxes on the capital (Art. 597).
3. To indemnify owner for loss due to
negligence of usufructuary or transferee.
XPN:
Right of Retention – given to a BPS in good
faith (Necessary Expenses)
- In this kind of contract it does not
involve necessary expenses but
extraordinary which should be
shouldered by the naked owner.
- The same right is given to a
usufructuary, he has the right of
retention which will serve as security
that the naked owner will reimburse him
of the extraordinary expenses that he
incurred.
- Although he has the obligation to return
the property of the same kind, that
obligation will not be immediately
complied with if he exercises the right of
retention in relation to the extraordinary
expenses he incurred.
To pay interest in the amount spent by
the owner for the extraordinary repairs
and to indemnify owner for losses due to
negligence of usufructuary.
Q: What is the reckoning point where the
usufructuary is entitled to the fruits of the
property? (Art. 567)
A: growing fruits at the time the usufruct begins
= belongs to usufructuary
- At the moment of the commencement of
the usufruct.
Q: What about if usufruct already
terminated?
A: Will go to the naked owner
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Property Notes A.Y. 2011-2012 Atty. Lopez-Rosario Lectures

Q: What are the obligations of the naked Q: What will happen to the contract of lease
owner? if the contract of usufruct is already
A: Naked owner must return to usufructuary all terminated?
the ordinary expenses incurred for the seeds, A: The contract of lease will terminate upon the
the preparation of those fruit bearing trees. termination of the contract of usufruct.
- Refund/reimbursement of the naked
owner only at the time of expiration Q: We said that a usufruct is extinguished upon
the death of the usufructuary, is it automatic
Reason: because at the time the
usufruct ceases, if trees do not bear fruit extinguishment?
A: As a Gen. Rule - Death of the usufructuary
but only flowers, the one who is
will not terminate the usufruct because as we all
benefited is naked owner.
know, is it a REAL RIGHT. It attaches to
- Principle of unjust enrichment
property, therefore death of the usufructuary will
- The naked owner is the one who eats
no automatically extinguish the usufruct.
the fruits, he needs to pay whatever
XPN: if there is a contrary stipulation in the
expenses incurred by the usufructuary.
contract.
- That is the only time when usufructuary
can demand reimbursement for the
ordinary expense.
- But generally, ordinary expenses should
be shouldered by the usufructuary.

Moralidad vs. Pernez

SC: Usufructuary is nothing else but simply
allowing one to enjoy another’s property
temporarily
- Right to use
- Right to enjoy
- Right to possess
- With the owner retaining the right to
dispose/power to alienate.

Art. 579-580-BPS-usufructuary
- Do not have the right for reimbursement
for the improvement he had introduced
in the property – usufructuary might
depose owner of his property.
e.g. usufructuary, builds a building in the
first place he knows that it is not his,
according to SC, he is not entitled to
reimbursement.

Q: What can the usufructuary do?

A: He may remove them without damage to
property

Q: Is usufructuary builder in Good faith?

A: No. He knows from the start that he does not
own the property. He cannot be considered a
builder in Good faith.

Q: If the usufructuary wants to have the

property leased, is consent from the Naked
Owner necessary?
A: NO CONSENT needed. One of the rights of a
usufruactuary is to enjoy the fruits.

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