Set A (34 Cases) PDF

Case 1: Davao Saw Mill v.
Castillo | GR no: L-40411 |
August 7, 1935 | Ponente: Malcolm, J.
Rights as Property | Personal Property
DOCTRINE.
achinery which is movable in its

Provisions of the Porto Rican Law and Code of Napoleon: M
nature only becomes immobilized when placed in a plant by the owner of the property or plant.
Such result would not be accomplished, therefore, by the placing of machinery in a plant by a
tenant or a usufructuary or any person having only a temporary right.
FACTS.
Davao Saw Mill Co., Inc. is the holder of a lumber concession from the Government of the
Philippine Islands. The land upon which the business operates belonged to another person. On
the land, the sawmill company erected a building which housed the machinery used by it. The
contract of lease between the parties stipulates that upon the expiration of the lease, all the
improvements and buildings introduced and erected by Davao Sawmill Co. shall be passed to the
exclusive ownership of the leasor without any obligation on its part to pay for any amount for
said improvements and buildings. On the other hand, Davao Saw Mill Co., Inc. has on a number
of occasion treated the machinery as personal property by executing chattel mortgages in favor
of third persons.
ISSUE.
WON the machineries and equipments were personal in nature.
RULING.
YES. Machinery which is movable in its nature only becomes immobilized (real) when placed in
a plant by the owner of the property or plant. But not when so placed by the tenant, a
usufructuary, or any person having only a temporary right, unless such person acted as the agent
of the owner. In the case at bar, it is machinery not intended by the owner of the 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.
Case 2: B.H Berkenkotter v. Cu Unjieng | GR no: L-41643 |
July 31, 1935 | Ponente: Villareal, J.
Rights as Property | Real Property
FACTS.
The Mabalacat Sugar Co., Inc., owner of the sugar central obtained from the defendants,
Unjieng, secured a loan by a first mortgage two parcels of land “with all its buildings,
improvements, sugar-cane mill, steel railway, telephone line, apparatus, utensils and whatever
forms part or is necessary complement of said sugar cane mill, steel railway, telephone line, now
existing or that may in the future exist in said lots.” B.A Green, President of the Mabalacat Sugar
Co., Inc., applied to Unjieng for an additional loan to buy additional machinery and equipments
to increase the capacity of its sugar central, promising to reimburse him as soon as he could
obtain an additional loan from the mortgages and offered Unjieng as security the additional
machinery and equipment acquired. B.A Green failed to obtain said loan.
ISSUE.
Whether the additional machinery was subject to the mortgage executed in favor of the
defendant.
RULING.
YES. Under the Civil Code, machinery intended by the owner of any building or land for use in
connection with any industry or trade being carried on therein and which are expressly adapted
to meet the requirements of such trade or industry, are considered as real property. If the
installation of the machinery and equipment in question in the central converted them into real
property by reason of their purpose, it cannot be said that their incorporation therewith was not
permanent in character because, as essential and principal elements of a sugar central, without
them the sugar central would be unable to function or carry on the industrial purpose for which it
was established. The new machinery must, therefore, be considered as subject to the real estate
mortgage in favor of the defendant (Unjieng).
Case 3: Lopez v. Orosa | GR nos: L-10817-18 |
February 28. 1958 | Ponente: Felix, J.
Immovable Property; Materialman’s lien
DOCTRINE
Same; Constructions: Whatever may be the materials used in the construction, or whether it is
attached to the soil by posts or is made to rest upon it, it will be immovable, provided that it is
not of such a provisional character, without fixed or integral adhence to the soil, that it can be
easily removed or destroyed independently of the tenement on which it stands. To be immovable,
therefore, it must be attached permanently to the land. It becomes immovable by incorporation.
Materialman’s lien: The materialman’s lien could be charged only to the building for which the
credit was made or which received the benefit of refection.
FACTS
Lopez operates a business called Lopez-Castelo Sawmill. Vicente Orosa, who happens to be a
neighbor of Lopez dropped at Lopez’s house and invited him to make an investment in the
theatre business. Although Lopez expressed his unwillingness to invest on the same, he agreed to
supply the lumber necessary for the construction of the proposed theatre. Orosa committed
himself to Lopez that he will be personally liable for any account that the said construction might
incur. Lopez further agreed that payment thereof would be on demand and not cash on delivery.
Orosa failed to pay Lopez for the expenses incurred with respect to the lumber delivered by
Lopez for the construction of its building.
Thus, Lopez filed a complaint against Orosa and Plaza Theatre Inc., praying that defendants be
sentenced to pay “jointly and severally” with legal interest from the filing of the action. That in
case defendants fail to pay the same, the building and land owned by the Corporation be sold at
public auction and proceed thereof be paid to said indebtedness.
ISSUES.
WON the materialmen’s lien for the value of the materials used in the construction of the
building attaches to said structure alone and doesn’t extend to the land on which the building is
adhered to.
RULING.
Yes. Such lien attaches to structure alone, and does not extend to the land where the building is.
For while it is true that generally, real estate connotes the land and the building constructed
thereon, it is obvious that the inclusion of the building separate and distinct from the land, is by
itself an immovable property. The lien created attaches merely to the immovable property for the
construction or repair of which the obligation was incurred. Thus, the lien in favor of appellant
for the unpaid value of the lumber used in the construction of the building attaches only to said
structure and to no other property of the obligors. Therefore, in the case at bar, the materialman’s
lien could be charged only to the building for which the credit was made or which received the
benefit of refection.
Case 4: Tumalad v. Vicencio | GR nos: L-30173 |
September 30, 1971 | Ponente: Reyes, J.B.L., J.
Immovable Property; Personal Property
DOCTRINE:
An object placed on land by one who had only a temporary right to the same, such as the lessee
or usufructuary, does not become immobilized by attachment. A mortgaged house built on a
rented land is held to be a personal property.
FACTS:
Defendants-appellants executed a chattel mortgage on favor of plaintiffs-appellees over their
house which were being rented from Madrigal & Company, Inc. The herein mortgage was
executed to guarantee a loan received from plaintiffs-appellees. When defendants-appellants
defaulted in paying, the mortgage was extrajudicially foreclosed. The house was auctioned and
plaintiff-appellees, as the highest bidder, acquired the house. Subsequently,
defendants-appellants were asked to vacate the premises and ordered to pay the rent until such
time the premises were cleared. Defendants-appellants impugned the legality of the chattel
mortgage, hence it would follow that the extrajudicial foreclosure, and necessarily the
consequent auction to sale, are void.
ISSUE:
Whether or not the chattel mortgage is void since it is an immovable property.
RULING:
NO. Although a building is by itself an immovable property, parties to a contract may treat it as
personal property that by nature would be real property and it would be valid and good only
insofar as the contracting parties are concerned. In the case at bar, although there is no specific
statement referring to the subject house as personal property, yet by ceding, selling or
transferring a property by way of chattel mortgage, defendants-appellants could only have meant
to convey the house as chattel, or at least, intended to treat the same. Subsequently, for that
reason, defendants-appellants are estopped from making an inconsistent stand and from claiming
otherwise.
Case 8: Meralco Co v. Bd. of Assessment Appeals| G.R. No. L-47943 |

May 31, 1982 | Ponente: AQUINO, J..
Real Property
DOCTRINE: The Code contains the following definition in its section 3:
"k) Improvements — is a valuable addition made to property or an amelioration in its condition,

amounting to more than mere repairs or replacement of waste, costing labor or capital and
intended to enhance its value, beauty or utility or to adapt it for new or further purposes."
FACTS:
Petitioner owns two oil storage tanks, made of steel plates wielded and assembled on
the spot. Their bottoms rest on a foundation consisted of compacted earth, sand pad
as immediate layer, and asphalt stratum as top layer. The tanks merely sit on its foundation.
The municipal treasurer of Batangas made an assessment for realty tax on the two tanks, based
on the report of the Board of Assessors. MERALCO wished to oppose this assessment as they
averred that the tanks are not real properties.
ISSUE: Whether or not the installed oil storage tanks considered a real property enumerated in
Article 415 of the Civil Code?
RULING:
YES. While the two storage tanks are not embodied in the land, they may nevertheless
be considered as improvements in the land, enhancing its utility and rendering it useful to
the oil industry. It is undeniable that the two tanks have been installed with some degree of
permanence as receptacles for the considerable quantities of oil needed by Meralco for its
operations.
Assessment Law, Commonwealth Act No. 470, and the Real Property Tax Code, Presidential
Decree No. 464 which took effect on June 1, 1974.
Section 2 of the Assessment Law provides that the realty tax is due "on real property, including
land, buildings, machinery, and other improvements" not specifically exempted in section 3
thereof. This provision is reproduced with some modification in the Real Property Tax Code
which provides:
"Sec. 38. Incidence of Real Property Tax. — They shall be levied, assessed and collected in all
provinces, cities and municipalities an annual ad valorem tax on real property, such as land,
buildings, machinery and other improvements affixed or attached to real property not hereinafter
specifically exempted."
Case 9: Caltex v. Bd. of Assessment Appeals | G.R. No. L-50466 |

May 31, 1982| Ponente: AQUINO, J.
Real Property
DOCTRINE:
Machinery — shall embrace machines, mechanical contrivances, instruments, appliances and
apparatus attached to the real estate. It includes the physical facilities available for production,
as well as the installations and appurtenant service facilities, together with all other equipment
designed for or essential to its manufacturing, industrial or agricultural purposes (See sec. 3[f],
Assessment Law).
FACTS:
The City Assessor characterized the items in gas stations of petitioner as taxable realty.These
items included underground tanks, elevated tank, elevated water tanks, water tanks,
gasoline pumps, computing pumps, etc. These items are not owned by the lessor of the
land wherein the equipment is installed. Upon expiration of the lease agreement, the
equipment should be returned in good condition.
Caltex invokes the rule that machinery which is movable in its nature only becomes immobilized
when placed in a plant by the owner of the property or plant but not when so placed by a tenant,
a usufructuary, or any person having only a temporary right, unless such person acted as the
agent of the owner (Davao Saw Mill Co. vs. Castillo, 61 Phil 709).
ISSUE: Whether or not the machines and equipment are considered real property or personal
property? (If realty property subject to tax; if personal property exempted)
RULING:
We hold that the said equipment and machinery, as appurtenances to the gas station building or
shed owned by Caltex (as to which it is subject to realty tax) and which fixtures are necessary to
the operation of the gas station, for without them the gas station would be useless, and which
have been attached or affixed permanently to the gas station site or embedded therein, are
taxable improvements and machinery within the meaning of the Assessment Law and the Real
Property Tax Code.
Improvements on land are commonly taxed as realty even though for some purposes they might
be considered personalty (84 C.J.S. 181-2, Notes 40 and 41). "It is a familiar phenomenon to
see things classed as real property for purposes of taxation which on general principle might be
considered personal property" (Standard Oil Co. of New York vs. Jaramillo, 44 Phil. 630, 633).
Case 10: Benguet Corp. v. Bd. of Assessment Appeals | G.R. No. 106041 |
January 29, 1993 | Ponente: CRUZ, J.
Real Property
DOCTRINES: A structure constitutes an improvement so as to partake of the status of realty

would depend upon the degree of permanence intended in its construction and use. The
expression "permanent" as applied to an improvement does not imply that the improvement
must be used perpetually but only until the purpose to which the principal realty is devoted has
been accomplished. It is sufficient that the improvement is intended to remain as long as the
land to which it is annexed is still used for the said purpose.
FACTS:
Contention of the petitioner that the dam cannot be subjected to realty tax as a separate and
independent property because it does not constitute an "assessable improvement" on the mine
although a considerable sum may have been spent in constructing and maintaining it.
ISSUE:
Whether or not the dam is considered as an improvement? (If it is an improvement it is real

property and it’s taxable)
RULING:
Section 2 of C.A. No. 470, otherwise known as the Assessment Law, provides that the realty tax
is due "on the real property, including land, buildings, machinery and other improvements" not
specifically exempted in Section 3 thereof. A reading of that section shows that the tailings dam
of the petitioner does not fall under any of the classes of exempt real properties therein
enumerated.
The Court is convinced that the subject dam falls within the definition of an "improvement"
because it is permanent in character and it enhances both the value and utility of petitioner's
mine. Moreover, the immovable nature of the dam defines its character as real property under
Article 415 of the Civil Code and thus makes it taxable under Section 38 of the Real Property
Tax Code.
Cases No. 11 & 12 (A, B, C):
A: La Bugal B’laan Tribal Association v. Ramos | GR 127882
Date: January 27, 2004 | Ponente: Carpio-Morales J.
B: La Bugal B’laan Tribal Association v. Ramos | GR 127882
Date: December 1, 2004 | Ponente: Panganiban J.
C: La Bugal B’laan Tribal Association v. Ramos | GR 127882
Date: February 1, 2005 | Ponente: Puno, Clerk of Court
(note: the SC only said here that the MR is a mere rehash)
Doctrine (Simplified Take Away): Re the use of state property – “service contract” that allows
foreign owned corporations to manage and operate, and vests beneficial rights of ownership are
invalid and unconstitutional. Only Financial and Technical Assistance Agreements (FTAA) with
aliens are allowed, subject to other limitations. Beneficial interest or financial benefits is
allowed. Beneficial ownership not allowed.
Facts:
In this landmark and very long case, the Supreme Court discussed and resolved various issues on
the use of State Property in relation to the use of Filipinos/Foreigners of the same as limited by
the Sec. 2, Article XII of the 1987 Constitution.
This case arrived at the Supreme Court challenging the constitutionality of RA 7942 or the
Philippine Mining Act, its Implementing Rules and Regulations issued by Department of
Environment and Natural Resources (DENR), and of the Financial and Technical Assistance
Agreement (FTAA) entered into on March 30, 1995 by the Republic of the Philippines and
WESTERN MINING CORPORATION ( Philippines) Inc. (WMCP, for brevity), a corporation
organized under Philippine laws.
Issue 1: Are some provisions of RA 7942, its implementing rules, and the FTAA between
President Ramos and WMCP valid and constitutional?
Case A: NO. Some provisions are null and void for vesting beneficial ownership. The text of
Section 2, Article XII of the Constitution, FTAAs should be limited to "technical or financial
assistance" only. Contrary to the language of the Constitution, the WMCP FTAA allows WMCP,
a fully foreign-owned mining corporation, to extend more than mere financial or technical
assistance to the State, for it permits WMCP to manage and operate every aspect of the mining
activity. This Court finds that R.A. No. 7942 is invalid insofar as said Act authorizes service
contracts which was abolished by the 1987 Constitution. Although the statute employs the phrase
"financial and technical agreements" in accordance with the 1987 Constitution, it actually treats
these agreements as service contracts that grant beneficial ownership to foreign contractors
contrary to the fundamental law.
It must be noted that the constitutional provision allowing the President to enter into FTAAs with
foreign-owned corporations is an exception to the rule that participation in the nation's natural
resources is reserved exclusively to Filipinos. Accordingly, such provision must be construed
strictly against their enjoyment by non-Filipinos.
Case B [after MR from OSG]: YES. It is valid and constitutional. Here the SC said, the ENTIRE
RA is valid. A careful perusal of the statute itself and its implementing rules reveals that neither
RA 7942 nor DAO 99-56 can be said to convey beneficial ownership of any mineral resource or
product to any foreign FTAA contractor. Beneficial ownership has been defined as ownership
recognized by law and capable of being enforced in the courts at the suit of the beneficial
owner.
The ratio decidendi: The implementing rules only aims to ensure an equitable sharing of the
benefits derived from mineral resources. Specifically, under the fiscal regime, the government's
expectation is the receipt of its share from the taxes and fees normally paid by a mining
enterprise. On the other hand, the FTAA contractor is granted by the government certain fiscal

and non-fiscal incentives to help support the former's cash flow during the most critical phase
(cost recovery) and to make the Philippines competitive with other mineral-producing countries.
This also spells out the financial benefits the government will receive from an FTAA, referred to
as "the Government Share," composed of a basic government share and an additional
government share. Also, the contractor in an FTAA provides all the needed capital, technical
and managerial expertise, and technology required to undertake the project.They provide all the
capital and expertise, and assumes all the risks - this setup cannot be regarded as
disadvantageous to the State or the Filipino people; it certainly cannot be said to convey
beneficial ownership of our mineral resources to foreign contractors.
Case C [after MR from petitioners]: SC said no need to discuss. All arguments are rehash.
Issue 2: Discuss the nature of state ownership of mineral resources in relation to the constitutional
provision on National Patrimony
All mineral resources are owned by the State. Their exploration, development and utilization (EDU) must
always be subject to the full control and supervision of the State. More specifically, given the inadequacy
of Filipino capital and technology in large-scale EDU activities, the State may secure the help of foreign
companies in all relevant matters -- especially financial and technical assistance -- provided that, at all
times, the State maintains its right of full control. The foreign assistor or contractor assumes all financial,
technical and entrepreneurial risks in the EDU activities; hence, it may be given reasonable management,
operational, marketing, audit and other prerogatives to protect its investments and to enable the business
to succeed.
Full control is not anathematic to day-to-day management by the contractor, provided that the State
retains the power to direct overall strategy; and to set aside, reverse or modify plans and actions of the
contractor. The idea of full control is similar to that which is exercised by the board of directors of a
private corporation: the performance of managerial, operational, financial, marketing and other functions
may be delegated to subordinate officers or given to contractual entities, but the board retains full residual
control of the business.
Issue 3: Who or what organ of government actually exercises this power of control on
behalf of the State?
The Constitution is crystal clear: the President. Indeed, the Chief Executive is the official
constitutionally mandated to "enter into agreements with foreign owned corporations." On the
other hand, Congress may review the action of the President once it is notified of "every
contract entered into in accordance with this [constitutional] provision within thirty days from its
execution." In contrast to this express mandate of the President and Congress in the EDU of
natural resources, Article XII of the Constitution is silent on the role of the judiciary. However,
should the President and/or Congress gravely abuse their discretion in this regard, the courts
may -- in a proper case -- exercise their residual duty under Article VIII. Clearly then, the
judiciary should not inordinately interfere in the exercise of this presidential power of control
over the EDU of our natural resources.
Issue 4: Having omitted the concession system and the services contracts, what is the new
modality under the 1987 Constitution?
The State may directly undertake State Property development activities OR it may enter into
co-production, joint venture, or production-sharing agreements with Filipino citizens, or
corporations or associations at least sixty per centum of whose capital is owned by such citizens.
Issue 5: Consonant with the "full supervision and control" of the State over natural
resources, what are the options of the State for the development of such properties (for
both Filipinos and Non-Filipinos)?
1. T
he State may directly undertake these activities itself (exclusively Filipino)
2. The State may enter into co-production, joint venture, or production-sharing
agreements with Filipino citizens, or entities at least 60% of whose capital is owned by
such citizens. (60 to 100% Filipino)
3. Congress may, by law, allow small-scale utilization of natural resources by Filipino
citizens, as well as cooperative fish farming, with priority to subsistence fishermen and
fish-workers in rivers, lakes, bays, and lagoons.
4. The President may enter into agreements with foreign-owned corporations involving
either technical or financial assistance for large-scale exploration, development, and
utilization of minerals, petroleum, and other mineral oils according to the general terms
and conditions provided by law, based on real contributions to the economic growth and
general welfare of the country. In such agreements, the State shall promote the
development and use of local scientific and technical resources. The President shall
notify the Congress of every contract entered into in accordance with this provision,
within thirty days from its execution.
Issue 6: In re the use of State Property, what are constitutional limitations set for Financial
and Technical Assistance Agreements (FTAA) with foreign-owned corporations?
Although Section 2 allows the participation of foreign-owned corporations in the exploration,

development, and utilization of natural resources, it imposes 8 limitations or conditions to
agreements with such corporations.
1. The parties to FTAAs. Only the President, in behalf of the State, may enter into
these agreements, and only with corporations.
2. The size of the activities: only large-scale exploration, development, and

utilization is allowed. The term "large-scale usually refers to very capital-intensive
activities."
3. The natural resources subject of the activities is restricted to minerals, petroleum

and other mineral oils, the intent being to limit service contracts to those areas where
Filipino capital may not be sufficient.
4. Consistency with the provisions of statute.The agreements must be in accordance

with the terms and conditions provided by law. Section 2 prescribes certain standards
for entering into such agreements.
5. The agreements must be based on real contributions to economic growth and

general welfare of the country.
6. The agreements must contain rudimentary stipulations for the promotion of the
development and use of local scientific and technical resources.
7. The notification requirement. The President shall notify Congress of every

financial or technical assistance agreement entered into within thirty days from its
execution.
8. The scope of the agreements. While the 1973 Constitution referred to "service
contracts for financial, technical, management, or other forms of assistance" the 1987
Constitution provides for "agreements. . . involving either financial or technical
assistance." It bears noting that the phrases "service contracts" and "management or
other forms of assistance" in the earlier constitution have been omitted.
Issue 7: If beneficial rights of ownership characterized by management and control are not
allowed, is “beneficial interest” allowed?
YES. It is allowed. While in this case, there is clearly no surrender of beneficial rights to
ownership, the beneficial interest that attaches to this case is constitutionally permissible. Our
minerals are also not FREELY given away. In the words of the Supreme Court: Foreign
contractors do not just waltz into town one day and leave the next, taking away mineral resources
without paying anything. In order to get at the minerals, they have to invest huge sums of money
(tens or hundreds of millions of dollars) in exploration works first. If the exploration proves
unsuccessful, all the cash spent thereon will not be returned to the foreign investors; rather,
those funds will have been infused into the local economy, to remain there permanently. The
benefits therefrom cannot be simply ignored. And assuming that the foreign contractors are
successful in finding ore bodies that are viable for commercial exploitation, they do not just
pluck out the minerals and cart them off. They have first to build camp sites and roadways; dig
mine shafts and connecting tunnels; prepare tailing ponds, storage areas and vehicle depots;
install their machinery and equipment, generator sets, pumps, water tanks and sewer systems,
and so on. These foreign contractors are also entitled to cost recovery.
Issue 8: Are financial benefits in the use of State Property by foreigners forbidden by the
constitution?
NO. They are not forbidden, but in fact constitutionally permissible. There is nothing inherently
wrong with or constitutionally objectionable about the idea of foreign individuals and entities
having or enjoying "beneficial interest" in -- and participating in the management of operations
relative to -- the exploration, development and utilization of our natural resources.
Issue 9: What are other relevant discussions of this case related to property law?
Legal History of the Use of State Property
- SPANISH REGIME: The regalia doctrine is from the Spanish. The first sentence of
Section 2, Art. XII of our present constitution embodies the Regalian doctrine or jura regalia.
The term "jura regalia" refers to royal rights, or those rights which the King has by virtue of
his prerogatives. In Spanish law, it refers to a right which the sovereign has over anything in
which a subject has a right of property or propriedad. These were rights enjoyed during
feudal times by the king as the sovereign. The term "jura regalia" refers to royal rights, or
those rights which the King has by virtue of his prerogatives. The Regalian doctrine extends
not only to land but also to "all natural wealth that may be found in the bowels of the earth."
Spain, in particular, recognized the unique value of natural resources, viewing them,
especially minerals, as an abundant source of revenue to finance its wars against other
nations. Mining laws during the Spanish regime reflected this perspective
- AMERICAN REGIME: Unlike Spain, the United States considered natural resources as a
source of wealth for its nationals and saw fit to allow both Filipino and American citizens to
explore and exploit minerals in public lands, and to grant patents to private mineral lands. A
person who acquired ownership over a parcel of private mineral land pursuant to the laws
then prevailing could exclude other persons, even the State, from exploiting minerals within
his property. The Regalian doctrine and the American system, therefore, differ in one
essential respect. Under the Regalian theory, mineral rights are not included in a grant of land
by the state; under the American doctrine, mineral rights are included in a grant of land by
the government.
- THE 1935 CONSTITUTION: IT NATIONALIZED NATURAL RESOURCES. The 1935
Constitution adopted the Regalian doctrine, declaring all natural resources of the Philippines,
including mineral lands and minerals, to be property belonging to the State. As adopted in a
republican system, the medieval concept of jura regalia is stripped of royal overtones and
ownership of the land is vested in the State. The nationalization and conservation of the
natural resources of the country was one of the fixed and dominating objectives of the 1935
Constitutional Convention.
- 1949 PETROLEUM ACT AND THE CONCESSION SYSTEM: The Petroleum Act of
1949 employed the concession system for the exploitation of the nation's petroleum
resources. Among the kinds of concessions it sanctioned were exploration and exploitation
concessions, which respectively granted to the concessionaire the exclusive right to explore
for or develop petroleum within specified areas. Concessions may be granted only to duly
qualified persons who have sufficient finances, organization, resources, technical
competence, and skills necessary to conduct the operations to be undertaken. Nevertheless,
the Government reserved the right to undertake such work itself. However, they did grant
concessionaires the right to explore, develop, exploit, and utilize them for the period and
under the conditions determined by the law.Concessions were granted at the complete risk of
the concessionaire; the Government did not guarantee the existence of petroleum or
undertake, in any case, title warranty
- PRESIDENTIAL DECREE NO. 87 (1972), THE 1973 CONSTITUTION AND THE
SERVICE CONTRACT SYSTEM: Presidential Decree No. 87 or The Oil Exploration and
Development Act of 1972 permitted the government to explore for and produce indigenous
petroleum through "service contracts." In a service contract under P.D. No. 87, service and
technology are furnished by the service contractor for which it shall be entitled to the
stipulated service fee. The contractor must be technically competent and financially capable
to undertake the operations required in the contract.
- THE 1973 CONSTITUTION contained provisions similar to the 1935 Constitution with
regard to Filipino participation in the nation's natural resources.

Case No. 13 and 14 (A, B, C):
A: Chavez v. Public Estates Authority (PEA) and Amari Coastal Bay | GR 133250
Date: July 9, 2002 | Ponente: Carpio J.
B: Chavez v. Public Estates Authority (PEA) and Amari Coastal Bay | GR 133250
Date: May 6, 2003 | Ponente: Carpio J.
C: Chavez v. Public Estates Authority (PEA) and Amari Coastal Bay | GR 133250
Date: November 11, 2003 | Ponente: Carpio J.
Doctrine (Simplified Take Away): State Property - Lands of the public domain cannot be sold
to private corporations. Lease is allowed; Sale invalid.
Facts: On this TRILOGY of cases under the GR no. 133250, the court is asked to resolve the
Joint Venture Agreements between the Philippine Estates Authority (a government
instrumentality with original charter) and the Amari Coastal Bay, a private corporation.
To avoid confusion, it is important to understand that there are two JVAs herein: (1) PEA –
AMARI ORIGINAL JVA to develop the Freedom Islands (reclaimed by the government) and
further reclaim the 250 hectares of land surrounding these islands. (2) PEA – AMARI
AMENDED JVA which involves the sale of 157.84 hectares of reclaimed public lands.
Issue 1: WON the stipulation in the amended JVA for the transfer to AMARI of certain
lands, reclaimed and to be reclaimed, valid and constitutional?
Case A: NO. It is invalid and unconstitutional.
Ratio: Two main reasons: 1. Private corporations cannot hold, except by lease, alienable lands of
the public domain. 2. The submerged areas of Manila Bay, being part of the sea, are inalienable
and beyond the commerce of man, a doctrine that has remained immutable since the Spanish
Law on Waters of 1886.PEA may validly own these lands as it is a public corporation, but
cannot transfer it to AMARI, a private corporation. The 1987 Constitution is clear, private
corporations cannot own public land except by lease. Viz: Art. XII, Section 2. All lands of the
public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of potential
energy, fisheries, forests or timber, wildlife, flora and fauna, and other natural resources are
owned by the State. With the exception of agricultural lands, all other natural resources shall not
be alienated. x x x. Section 3. x x x Alienable lands of the public domain shall be limited to
agricultural lands. Private corporations or associations may not hold such alienable lands of the
public domain except by lease. The constitutional intent, under the 1973 and 1987 Constitutions,
is to transfer ownership of only a limited area of alienable land of the public domain to a
qualified individual. This constitutional intent is safeguarded by the provision prohibiting
corporations from acquiring alienable lands of the public domain, since the vehicle to circumvent
the constitutional intent is removed. The available alienable public lands are gradually
decreasing in the face of an ever-growing population. The most effective way to insure faithful
adherence to this constitutional intent is to grant or sell alienable lands of the public domain only
to individuals
Case B: It is invalid and unconstitutional. PEA’s argument that it is similar to the Bases
Conversion Department Authority is wrong. The latter is authorized by law to sell specific
government lands that have long been declared by presidential proclamations as military
reservations for use by the different services of the armed forces under the Department of
National Defense.The former, PEA took the place of DENR as the government agency charged
with leasing or selling reclaimed lands of the public domain. BCDA is specific, PEA is general
and national. There is no similarity.
Furthermore, the argument of PEA that lands transferred to are private land is legally misplaced.
To allow vast areas of reclaimed lands of the public domain to be transferred to PEA as private
lands will sanction a gross violation of the constitutional ban on private corporations from
acquiring any kind of alienable land of the public domain.
Case C: It is invalid and unconstitutional. PEA-AMARI attempted to use the Ponce Cases to
justify their JVA. The Ponce cases do not apply. In those cases, the City of Cebu retained
ownership of the reclaimed lands – it merely entered into an agreement to give Essel, Inc. the
“irrevocable option” to purchase land once reclaimed. In PEA-AMARI, the JVA vested
immediate ownership to PEA. Moreover, the bigger consideration is, the Ponce Cases were
decided under the 1935 constitution which allowed private corporations to acquire alienable
lands of the public domain. However, the 1973 Constitution (which was later copied by 1987
Constitution) prohibited private corporations from acquiring alienable lands of public domain.
Nimfa USERO, Petitioner v. COURT OF APPEALS and SPS. Herminigildo & Cecilia Polinar,
Respondents
G.R. No. 155055 : January 26, 2005
Corona J.
DOCTRINE:
Article 420 (Civil Code):
The following things are property of public dominion:
(1) Those intended for public use, such as roads, canals, rivers, torrents, ports and bridges constructed
by the State, banks, shores, roadsteads and others of similar character;
NOTE: Creek- Part of the direct provision “others of similar character”
FACTS:
Petitioner owns a parcel of land located in Golden Acres Subdivision while private respondents also owns
a parcel of land located in Pilar Village, situated behind the lots of petitioners. In between the lots of both
the respondents and the petitioners, is a low-level strip of land, with a stagnant body of water filled with
floating water lilies. When it rains, the water rises in the low-level strip of land and causes damage to the
house of the private respondents. Respondents (July 30, 1998) built a concrete wall on the bank of the
strip of land (3 meters from their house) and rip-rapped the soil on that portion of land. Petitioners claimed
ownership of the strip of land and demanded that respondents should stop. However, respondents
believed that the strip of land was part of the creek. Respondents offered to pay for the strip of land but
petitioners did not agree to such.
ISSUE:
Whether or not the disputed strip of land is the private property of petitioners or part of the public domain?
RULING:
The strip of land form part of the creek and not of the private property of the petitioners. The
subject strip of land being a creek is evidenced by:
· A barangay certification
· A certification from the Second Manila Engineering District
· Photographs showing the abundance of water lilies
The petitioners failed to present sufficient proof to support their claim. Their TCTs were
incomplete as well as their tax declarations. It is only conclusive from the evidences that the
strip of land is a creek and belongs to no one but the State. In relation to article 420 of the Civil
Code, the phrase “others of similar character” includes a creek which is a recess or an arm of a
river. It is property belonging to the public domain and not susceptible to private ownership.
Being public water, a creek cannot be registered under the Torrens system in the name of any
individual.
VIUDA DE TAN TOCO, plaintiff-appellee v. MUNICIPAL COUNCIL OF ILOILO,
defendants-appellants.
G.R. No. L-24950 : March 25, 1926
Villamor, J.
DOCTRINE:
The property of provinces, cities and municipalities is divided into property for public use and
patrimonial property.
Property for public use, in the provinces, cities, and municipalities, consist of the provincial
roads, city streets, municipal streets, the squares, fountains, public waters, promenades, and
public works for public service paid for by said provinces, cities, or municipalities.
All other property possessed by any of them is patrimonial and shall be governed by this Code,
without prejudice to the provisions of special laws.
FACTS:
The widow of Tan Toco sued the municipal council of Iloilo for the two strips of land which the
municipality of Iloilo had appropriated for widening said street. CFI Ilo- ilo ordered the said
municipality to pay Mrs. Tantoco the said amount, plus its interest. Said judgment was
appealed, and was affirmed by the Supreme Court. On account of lack of funds the municipality
of Iloilo was unable to pay the said
judgment, wherefore plaintiff had a writ of execution issue against the property of the said
municipality, by virtue of which the sheriff attached two auto trucks, one police patrol
automobile, the police stations on Mabini street, and in Molo and Mandurriao and the concrete
structures, with the corresponding lots. After notice of the sale of said property had been made
the provincial fiscal of Iloilo filed a motion with the CFI praying that the attachment on the said
property be dissolved, that the said attachment be declared null and void as being illegal and
violate the rights of the municipality. To which the Court agree, declaring the attachment levied
upon the aforementioned property of the municipality null and void, hence this appeal.
ISSUE:
Whether the Municipal properties can be executed in lieu of the unsatisfied obligation?
RULING:
No. The principle is that the property for public use of the State is not within the commerce of
man and, consequently, is inalienable and not subject to prescription. Likewise, property for
public use of the municipality is not within the commerce of man so long as it is used by the
public and, consequently, said property is also inalienable. Municipal corporations are created
for public purposes and for the good of the citizens in their aggregate or public capacity. That
they may properly discharge such public functions corporate property and revenues are
essential, and to deny them these, means the very purpose of their creation would be materially
impeded, and in some instances practically destroy it. It is generally held that property owned
by a municipality, where not used for a public purpose but for quasi private purposes, is
subject to execution on a judgment against the municipality, and may be sold. The rule is that
property held for public uses, such as public buildings, streets, squares, parks, promenades,
wharves, landing places, fire engines, hose and hose carriages, engine houses, public markets,
hospitals, cemeteries, and generally everything held for governmental purposes, is not subject
to levy and sale under execution against such corporation. The rule also applies to funds in the
hands of a public officer. But property held for public purposes is not subject to execution merely
because it is temporarily used for private purposes, although if the public use is wholly
abandoned it becomes subject to execution.
THE PROVINCE OF ZAMBOANGA DEL NORTE, plaintiff-appellee v. CITY OF ZAMBOANGA,

SECRETARY OF FINANCE and COMMISSIONER OF INTERNAL REVENUE,
defendants-appellants.
G.R. No. L-24440 : March 28, 1968
Bengzon, J.P., J.
DOCTRINE:

The property of provinces, cities, and municipalities is divided into property for public use and
patrimonial property;
Property for public use, in the provinces, cities, and municipalities, consists of the provincial
public works for public service paid for by said provinces, cities, or municipalities. All other
property possessed by any of them is patrimonial and shall be governed by this Code, without
prejudice to the provisions of special laws.
Ejusdem generis rule- public works must be for free and indiscriminate use by anyone. (first
paragraph of art. 424)
FACTS:
Prior to its incorporation as a chartered city, the Municipality of Zamboanga used to be the
provincial capital of the then Zamboanga Province. Commonwealth Act 39 was approved
converting the Municipality of Zamboanga into Zamboanga City. Sec. 50 of the Act also
provided that Buildings and properties which the province shall abandon upon the transfer of the
capital to another place will be acquired and paid for by the City of Zamboanga at a price to be
fixed by the Auditor General. However, Republic Act 3039 was approved amending Sec. 50 of
Commonwealth Act 39 by providing that, “All buildings, properties and assets belonging to the
former province of Zamboanga and located within the City of Zamboanga are hereby
transferred, free of charge, in favor of the said City of Zamboanga.” This constrained
Zamboanga del Norte to file a complaint against defendants-appellants Zamboanga City; that,
among others, Republic Act 3039 be declared unconstitutional for depriving Zamboanga del
Norte of property without due process and just compensation. The lower court declared RA
3039 unconstitutional as it deprives Zamboanga del Norte of its private properties, hence this
appeal.
ISSUE:
Whether or not RA 3039 is unconstitutional in relation to plaintiff’s claim of its alleged “private”
properties?
RULING:
No. RA 3039 is valid insofar as it affects the lots used as capitol site, school sites and its
grounds, hospital and leprosarium sites and the high school playground sites (total of 24 lots).
The properties petitioned by Zamboanga del Norte are public property. Since the lots were held
by the former Zamboanga Province in its governmental capacity and therefore are subject to the
absolute control of Congress.
The validity of the law ultimately depends on the nature of the 50 lots and buildings thereon in
question. For, the matter involved here is the extent of legislative control over the properties of a
municipal corporation, of which a province is one. The principle itself is simple: If the property is
owned by the municipality (meaning municipal corporation) in its public and governmental
capacity, the property is public and Congress has absolute control over it. But if the property is
owned in its private or proprietary capacity, then it is patrimonial and Congress has no absolute
control. The municipality cannot be deprived of it without due process and payment of just
compensation.
Moreso, regarding the several buildings existing on the lots, the records do not disclose whether
they were constructed at the expense of the former province of Zamboanga. It can be assumed
that the buildings were erected by the national government, using national funds. Hence,
Congress could very well dispose of said buildings in the same manner that it did with the lots in
question. BUT even assuming that the provincial funds were used, still the buildings constitute
mere accessories to the lands which are public in nature.
RAFAEL S. SALAS, petitioners-appellants v. HON. HILARION U. JARENCIO,
respondents-appellees.
G.R. No. L-29788 : August 30, 1972
Esguerra, J.
DOCTRINE:
The property of provinces, cities and municipalities is divided into property for public use and
patrimonial property.
Property for public use, in the provinces, cities, and municipalities, consist of the provincial
public works for public service paid for by said provinces, cities, or municipalities.
All other property possessed by any of them is patrimonial and shall be governed by this Code,
without prejudice to the provisions of special laws.
FACTS:
The City of Manila had a Torrens Title over a parcel of land. The municipal Board of Manila
requested the President of the Philippines to have the lot declared as patrimonial property of the
City so that it could be sold by the City to the actual occupants of the said parcel of land.
Congress enacted RA 4118 whereby the lot was made disposable or alienable land of the State
and not of the City, and its disposal was given to a national government entity, the Land Tenure
Administration.
ISSUE:
Whether the aforementioned land is a private or patrimonial property of the City of Manila?
RULING:
The land is public property. As a general rule, regardless of the source or classification of the
land in the possession of municipality, excepting those which it acquired in its own funds in its
private or corporate capacity, such property is held for the State for the benefit of its inhabitants,
whether it be for governmental or proprietary purposes. The legal situation is the same if the
State itself holds the property and puts it to a different use. The property was not acquired by
the City of Manila with its own funds in its private or proprietary capacity. The land was part of
the territory of the City of Manila granted by the sovereign in its creation. Furthermore, the City
expressly recognized the paramount title of the State over its land when it requested the
President to consider the feasibility of declaring the lot as patrimonial property for selling. There
could be no more blatant recognition of the fact that said land belongs to the State and was
simply granted in usufruct to the City of Manila for municipal purposes. But since the City did not
actually use said land for any recognized public purpose and allowed it to remain idle and
unoccupied for a long time until it was overrun by squatters, no presumption of State grant of
ownership in favor of the City of Manila may be acquiesced in to justify the claim that it is its own
private or patrimonial property.
Case 19: Cebu Acetylene vs Bercilles | GR no: L-40475 |

August 29, 1975 | Ponente: Concepcion, Jr., J.
Abandoned Road | Patrimonial property
DOCTRINE:
Property of public dominion withdrawn from public use becomes patrimonial property –
Article 422 of the Civil Code expressly provides that “Property of public dominion, when no
longer intended for public use or for public service, shall form part of the patrimonial property of
the State.”
Patrimonial property can be the object of an ordinary contract
FACTS:
On December 19, 1968, the City Council of Cebu passed Resolution No. 2193, declaring the
terminal portion of M Borces Street, in Mabolo, Cebu City as an abandoned one. The City
Councilor of Cebu again passed another resolution, ordering the sale of the sale lot. It was then
awarded to herein petitioner (Cebu Oxygen Acetylene Co., Inc.) as being the highest bidder of
the said land for a total consideration of P10, 800.00. On June 26, 1974, Assistant Provincial
Fiscal of Cebu filed a motion to dismiss the application on the ground that the property sought to
be registered being a public road intended for public use is considered part of the public domain
and therefore outside the commerce of man.
ISSUE:
Whether or not declaring the road as an abandoned one, will make it as a patrimonial property
of the City of Cebu, and will be an object of a common contract?
RULING:
The answer is in the affirmative. Declaring the road as an abandoned one, will make
it as a patrimonial property of the City of Cebu, and can be an object of a common contract later
on.
Under Article 422 of the Civil Code, it expressly provides that: “Property of public dominion
when no longer intended for public use or for public service, shall form part of the patrimonial
property of the State.”
Besides, the Revised Charter of the City of Cebu heretofore quoted in very clear and
unequivocal terms that: “Property thus withdrawn from public servitude may be used or
conveyed for any purpose for which other real property belonging to the City may be lawfully
used or conveyed.”
In the case at bar, the withdrawal of the property in question from public use and its subsequent
sale to the petitioner is valid. Ergo, petitioner has a registrable title over the lot in question.
Case 21: Mun. of San Miguel vs. Fernandez | GR no: L-61744 |

June 25, 1984 | Ponente: Relova, J.
Possession of public lands
DOCTRINE:
Possession of public lands, however long never confers upon the possession unless the
occupant of the same under claim of ownership for the required period to constitute a grant from
the State (Republic vs. Vera, 120 Scra 210.)
Exception to the rule that public lands may be acquired by prescription is not applicable in the
absence of conclusive showing of continuous posession and occopancy of public land under
claim of ownership. Presumptive grant from the State is not applicable as possession is not
exclusive and notorious (Municipality of Santiago, Isablea vs. Court of Appeals, 120 SCRA 734.)
FACTS:
In Civil Case No. 604-B, entitled "Margarita D. Vda. De Imperio, et al. v. Municipal Government
of San Miguel, Bulacan, et al." dated April 28, 1978, under presiding Judge Oscar C.
Fernandez, rendered judgement in favour of the plaintiffs and against the defendant Municipal
Government of San Miguel, Bulacan, represented by Mayor Mar Marcelo G. Aure and its
Municipal Treasurer. The court ordered the defendant municipality to pay the plaintiffs the sum
of Php64,440.00 corresponding to the rentals collected from the tenants from 1970 up to and
including 1975 plus interest thereon at the legal rate from January 1970 until fully paid. In
addition to this, the defendant municipality must pay the plaintiffs the sum of Php3,000.00 for
attorney's fees and to pay the cost of suit. Thereafter, the private respondents moved for
issuance of the writ of execution for the satisfaction of the said judgement, however, petitioner,
on July 30, 1982, filed a Motion to Quash the writ of execution on the ground that the
municipality's property or funds are all public funds exempt from execution. The said Motion was
then denied by the respondent judge in an order dated August 23, 1982 and the writ of
execution still stands in full force and effect.
ISSUE:
Whether or not the funds of the Municipality of San Miguel, Bulacan are public funds which are
exempt from the execution?
RULING:
The answer is in the affirmative. Well settled is the doctrine of law that not only the public
property but also the taxes and public revenues of such [municipal] corporations cannot be
seized under execution against them, either in the treasury or when in transit to it. Judgments
rendered for taxes, and the proceeds of such judgments in the hands of officers of the law are
subject to execution so declared by statute.
Case 21: Government vs. Cabangis | GR no: 28379 |

March 27, 1929 | Ponente: Villa-Real, J.
Shores| Public Dominion
DOCTRINE:
LAND REGISTRATION; LAND DISAPPEARING INTO SEA; PUBLIC DOMAIN – As the lots in
question 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 filing in done by the Government,
they belong to the public domain for public use. (Aragon vs. Insular Government, 19 Phil., 223;
Francisco vs. Government of the Philippines Islands, 28 Phil., 505.)
FACTS:
The Government of the Philippines appeals to the Court from the judgment of the Court of First
Instance of Manila, adjudicating the title and decreeing the registration of lots Nos. 36, 39, and
40, block 3055 of the cadastral survey of the City of Manila in favor of Cabangis. From the year
1896, said land began to wear away due to the action of the waves of Manila bay, until the year
1901 when the said lots became completely submerged and remained in such state until 1912
when the Government undertook dredging of Vitas Estuary, depositing all the lands which were
covered with water, thereby slowly and gradually forming the lots, which is the subject matter of
this proceeding.
ISSUE:
Whether or not the lots in question are property of public dominion?

RULING:
The answer is in the affirmative.
The Supreme Court held that the lots in question having disappeared of the gradual erosion due
to the ebb and flow of the tide, and having remained in such a state until they were reclaimed
from the sea by the filing in done the Government, they are public lands in the sense that
neither the herein claimants-appellees nor their predecessors did anything to prevent their
destruction. Ergo, said lots in question are of property of public dominion.
NOTES:
Article 339, subsection 1, of the Civil Code, reads: “Art. 339. Property of public ownership is
– “1. That devoted to public use, such as roads, canals, rivers, torrents, ports and bridges
constructed by the State, riverbanks, shores, roadsteads, and that of a similar character.”
Article 1, case 3 of the Law of Waters of August 3, 1866 provides as follows: “Art. 1. The
following are part of the national domain open to public use: “3. The Shores. By the shore is
understood that space covered and uncovered by the movement of the tide. Its interior or
terrestrial limit is the line reached by the highest equinoctial tides. Where the tides are not
appreciable, the shore begins on the land side at the line reached by the sea during ordinary
storms or tempests.”
Case 22: Hilario vs. Salvador | GR no: 160384 |

April 29, 2005 | Ponente: Callejo, SR., J.
Accion Publiciana or Accion Reinvindicatoria
DOCTRINE:
An Accion Publiciana; Accion Reinvindicatoria; Words and Phrases; An accion

reinvindicatoria is a suit which has for its object for the recovery of possession over the real
property as owner while an accion publiciana is one for the recovery of the right to possess – it
is also referred to as an ejectment suit filed after the expiration of one year after the occurrence
of the cause of action or from the unlawful withholding of possession of the realty.
FACTS:
Petitioners Cesar, Ibarra, Nestor, Lina, and Prescilla, all surnamed Hilario (Hilario), are
co-owners by inheritance from Concepcion Mazo Salvador, a parcel of land located in Romblon,
which property was [adjudged] as the hereditary share of their father, Brigado M. Hilario, Jr. In
1996, they filed a complaint with the RTC of Romblon against herein, private respondent Allan
T. Salvador (Salvador) alleging that as co-owners, they are entitled to possession of the lot, and
that respondent constructed his house thereon without their knowledge and refused to vacate
the property despite demands to do so. They prayed for the private respondent to vacate the
property and restore possession thereof to them.
ISSUE:
Whether or not the action filed by Hilario was an accion reinvindicatoria?
RULING:
No. The action filed by Hilario was an accion publiciana, or one for the recovery of possession
of the real property subject matter thereof.
An accion reinvindicatoria is a suit which has for its object for the recovery of possession over
the real property as owner while an accion publiciana is one for the recovery of the right to
possess – it is also referred to as an ejectment suit filed after the expiration of one year after the
occurrence of the cause of action or from the unlawful withholding of possession of the realty.
In the present case, the action filed by Hilario did not involve a claim of ownership over the
property. They prayed that Salvador vacate the property and restore possession to them. Ergo,
it was an accion publiciana, or one for the recovery of the real property.
Case 23: CESAR SAMPAYAN vs. The HONORABLE COURT OF APPEALS, CRISPULO
VASQUEZ and FLORENCIA VASQUEZ GILSANO | G.R. No. 156360 |
January 14, 2005 | GARCIA, J.
Ownership
Doctrine (Simplified Take away):

In an action for forcible entry, the plaintiff must prove that he was in prior possession of the land
or building and that he was deprived thereof by means of force, intimidation, threat, strategy or
stealth. Absence of prior physical possession by the plaintiff in a forcible entry case warrants the
dismissal of his complaint.
FACTS: A complaint for forcible entry was filed by siblings Crispulo Vasquez and Florencia
Vasquez-Gilsano against Cesar Sampayan before the MCTC of Agusan del Sur, for allegedly
having entered and occupied a parcel of land through strategy and stealth, and built a house
thereon without their knowledge, consent or authority.
Defendant Sampayan denied the allegations and moved for the dismissal of the complaint. He
averred the following:
· thatneither the plaintiffs nor their mother have ever been in possession of the land and
that he does not even know plaintiffs’ identities or their places of residence.
· He did not enter the subject lot by stealth or strategy because he asked and was given
permission therefor by Maria Ybañez, the overseer of the lot’s true owners, Mr. and Mrs.
Anastacio Terrado who were then temporarily residing in Cebu City for business
purposes.
ISSUES:
1. Whether or not the MCTC had jurisdiction over the complaint filed in this case
2. W
hether or not the complaint for forcible entry is proper.
RULING:
1. YES. For the MCTC to acquire jurisdiction over a forcible entry case, it is enough that the
complaint avers the jurisdictional facts, i.e. that the plaintiff had prior physical possession and
that he was deprived thereof by the defendant through force, intimidation, threats, strategy and
stealth. The complaint in this case makes such an averment. Hence, the irrelevant circumstance
that the evidence adduced during the hearing rendered improper an action for forcible entry is of
no moment and cannot deprive the MCTC of its jurisdiction over the case. The MCTC continues
to have that jurisdiction.
2. NO. ACCION PUBLICIANA OR PLENARIA DE POSESION is the proper action. In an

action for forcible entry, the plaintiff must prove that he was in prior possession of the land or
building and that he was deprived thereof by means of force, intimidation, threat, strategy or
stealth. Absence of prior physical possession by the plaintiff in a forcible entry case warrants the
dismissal of his complaint.
In the instant case, there is an uncontested finding of the MCTC judge himself during his ocular
inspection of the premises in dispute that what he saw thereat "confirmed the allegations of the
defendant [now petitioner Sampayan that his predecessors-in-interest have introduced
improvements by planting caimito trees, coconut trees, and others on the land in question",
adding that "Nothing can be seen on the land that plaintiff (now respondents) had once upon a
time been in possession of the land". Likewise, MCTC Judge categorically stated that "The
allegation that Cristita Quita, the predecessor-in-interest of the plaintiffs had been in possession
of the said property since 1957, openly, exclusively, continuously, adversely and in the concept
of an owner is a naked claim, unsupported by any evidence".
Then, too, there is the sworn affidavit of Dionesia Noynay to the effect that she had been
residing since 1960 onward on Lot No. 1957, the lot adjacent to Lot No. 1959, and that neither
the private respondents nor their mother had ever possessed Lot No. 1959. Coming as it does
from an immediate neighbor, Dionesia’s statement commands great weight and respect.
Incidentally, the MCTC judge himself found during the ocular inspection that a portion of the
house of Macario Noynay, husband of Dionesia, protruded on Lot No. 1959.
Case 24: RUBEN SANTOS vs. SPOUSES TONY AYON and MERCY AYON | G.R. No.
137013 | May 6, 2005 | SANDOVAL-GUTIERREZ, J.
Ownership

It bears stressing that possession by tolerance is lawful, but such possession becomes unlawful
when the possessor by tolerance refuses to vacate upon demand made by the owner. Our
ruling in Roxas vs. Court of Appeals 391 SCRA 351 is applicable in this case: “A person who
occupies the land of another at the latter’s tolerance or permission, without any contract
between them, is necessarily bound by an implied promise that he will vacate upon demand,
failing which, a summary action for ejectment is the proper remedy against him.”
FACTS: In 1996, the petitioner, Santos, filed with the Municipal Trial Court in Cities (MTCC) in
Davao City a complaint for illegal detainer against the respondents, spouses Ayon. In his
complaint, he averred that a building used by the respondents as a warehouse, encroached on
a portion of his land. As early as 1985, he had allegedly already informed respondents that the
said building occupies a portion of his land, but allowed them to continue using the building. In
1996, needing the entire portion of his lot, he demanded that respondents remove the part of
the building encroaching on his property, but respondents refused and continued to occupy the
contested portion.
The MTCC ruled in favor of the petitioner and ordered the respondents to vacate and surrender
possession of the property. On appeal, the RTC affirmed in toto the MTCC judgment, and
upheld the finding that respondents’ occupation of the contested portion was by mere tolerance.
On petition for review however, the CA held that the petitioner's proper remedy should have
been an accion publiciana before the RTC and not an action for unlawful detainer, and thus
dismissing the complaint.
ISSUE: Whether the MTCC properly exercised jurisdiction over the complaint.
RULING: YES. All actions for forcible entry or unlawful detainer shall be filed with the proper
Metropolitan Trial Courts, the Municipal Trial Courts and the Municipal Circuit Trial Courts,
which actions shall include not only the plea for restoration of possession but also all claims for
damages and costs arising therefrom. The said courts are not divested of jurisdiction over such
cases even if the defendants therein raise the question of ownership over the litigated property
in his pleadings and the question of possession cannot be resolved without deciding the issue of
ownership.
The Court found no error in the MTCC assuming jurisdiction over the petitioner's complaint. A
complaint for unlawful detainer is sufficient if it alleges that the withholding of the possession or
the refusal to vacate is unlawful, without necessarily employing the terminology of the law. Here,
there is an allegation in the petitioner's complaint that respondents’ occupancy on the portion of
his property is by virtue of his tolerance. Petitioner’s cause of action for unlawful detainer
springs from respondents’ failure to vacate the questioned premises upon his demand
sometime in 1996.
Case 25: RENE GANILA et al., vs. HON. COURT OF APPEALS AND VIOLETA C.
HERRERA | G.R. No. 150755 | June 28, 2005 | QUISUMBING, J.
Ownership

In unlawful detainer, prior physical possession by the plaintiff is not necessary. It is enough that
the plaintiff has a better right of possession. Actual and prior physical possession of a property
by a party is indispensable only in forcible entry cases. In unlawful detainer cases, the
defendant is necessarily in prior lawful possession of the property but his possession eventually
becomes unlawful upon termination or expiration of his right to possess.
FACTS: Private respondent, Violeta Herrera, filed 21 ejectment complaints in the MCTC, which
ordered the 21 defendants, now petitioners, to vacate the property in question (Lot 1227). The
RTC sustained the decision as to 19 defendants but dismissed the case against 2. The 19
defendants who were ordered to vacate Lot 1227 filed a petition for review with the CA based
on two arguments, namely: first, that they possessed lot 1227 in good faith for more than 30
years in the concept of owners, and second, that there was no withholding of possession since
private respondent was not in prior possession of the lot.
ISSUES:
1. Whether prior physical possession by the plaintiff is necessary for a complaint for
unlawful detainer to prosper.
2. Whether private respondent properly filed complaints for unlawful detainer.
3. Whether private respondent should have filed an action to recover possession de jure,
as argued by petitioners on appeal.
RULING:
1. NO. While petitioners assert that this case involves only deprivation of possession, they
confuse the remedy of an action for forcible entry with that of unlawful detainer. In
unlawful detainer, prior physical possession by the plaintiff is not necessary. It is enough
that the plaintiff has a better right of possession. Actual and prior physical possession of
a property by a party is indispensable only in forcible entry cases. In unlawful detainer
cases, the defendant is necessarily in prior lawful possession of the property but his
possession eventually becomes unlawful upon termination or expiration of his right to
possess. Thus, the fact that petitioners are in possession of the lot does not
automatically entitle them to remain in possession. And the issue of prior lawful
possession by the defendants does not arise at all in a suit for unlawful detainer simply
because prior lawful possession by virtue of contract or other reasons is given or
admitted. Unlike in a forcible entry where defendants, by force, intimidation, threat,
strategy or stealth, deprive the plaintiff or the prior physical possessor of possession,
here there is no evidence to show that petitioners entered the lot by any of these acts.
2. YES. If only to stress the fundamental principles related to the present controversy,
jurisdiction over unlawful detainer suits is vested in Municipal Trial Courts. And in
ejectment cases, the jurisdiction of the court is determined by the allegations of the
complaint. In the case for ejectment, private respondent’s allegations sufficiently present
a case of unlawful detainer. She alleged that (1) she owns Lot 1227, (2) she tolerated
petitioners to construct their houses thereon; (3) she withdrew her tolerance; and (4)
petitioners refused to heed her demand to vacate the lot. The Complaints were also filed
within one year from the date of her demand. The cause of action for unlawful detainer
between the party’s springs from the failure of petitioners to vacate the lot upon lawful
demand of the private respondent. When they refused to vacate the lot after her
demand, petitioners’ continued possession became unlawful. Her complaint for
ejectment against respondent, to put it simply, is not without sufficient basis.
3. NO. Petitioners’ contention that private respondents should have filed an action to
recover possession de jure with the TC is not supported by law or jurisprudence. The
distinction between a summary action of ejectment and a plenary action for recovery of
possession and/or ownership of the land is settled in our jurisprudence. Petitioners’
present contention was first raised only in their appeal to the RTC. Raising it before the
appellate tribunal is barred by estoppel. They should have raised it in the proceedings
before the MCTC. In our view, this issue is a mere afterthought, when the MCTC
decided against them. Basic rules of fair play, justice and due process require that as a
rule an issue cannot be raised by the petitioners for the first time on appeal.
Case 26: ROSS RICA SALES CENTER, INC. and JUANITO KING & SONS, INC. vs.
SPOUSES GERRY ONG and ELIZABETH ONG | G.R. No. 132197 | August 16, 2005 | Tinga,
J.
Ownership

The issue involved in accion reivindicatoria is the recovery of ownership of real property. This
differs from accion publiciana where the issue is the better right of possession or possession de
jure, and accion interdictal where the issue is material possession or possession de facto. In an
action for unlawful detainer, the question of possession is primordial, while the issue of
ownership is generally unessential.
FACTS: The spouses Ong are the original owners of 3 parcels of land which they occupy. They
sold it to Mandaue Prime Estate Realty, which then sold it to Ross Rica Sales Center, Inc. The
spouses Ong filed an action to annul the sale and transfer of property to Mandaue Prime Estate
Realty and at present, the case is still pending. In the meantime, an ejectment case was filed
against spouses Ong in the MTC, which ruled against the latter. On appeal to the RTC, the
judgment was affirmed by a decision dated March 1, 1997. The spouses Ong received a copy of
the decision on April 28, 1997.
The spouses Ong first filed a Notice of Appeal with the RTC (May 8, 1997) but on the very next
day filed a Motion for Reconsideration, which was denied on June 23, 1997. The spouses Ong
received a copy of the order on July 9, 1997. On July 24, 1997 respondents filed with the CA a
motion for an additional 10 days to file their Petition for Review, which they would eventually file
on July 30, 1997.
The CA gave their petition for review due course and reversed the decision of the RTC on the
finding that the action filed was not one for unlawful detainer based on two grounds: that the
allegations fail to show that petitioners were deprived of possession by force, intimidation,
threat, strategy or stealth; and that there is no contract, express or implied, between the parties
that would qualify the case as one of unlawful detainer.
ISSUES:
1. Whetherthe complaint satisfies the jurisdictional requirements for a case of unlawful
detainer properly cognizable by the MTC.
2. Whether the case should be considered as one for accion reivindicatoria, and thus
the jurisdiction would lie with the RTC.
RULING:
1. YES. Well-settled is the rule that what determines the nature of an action as well as
which court has jurisdiction over it are the allegations of the complaint and the
character of the relief sought. In Javelosa vs. Court of the Appeals, it was held that
the allegation in the complaint that there was unlawful withholding of possession is
sufficient to make out a case for unlawful detainer. It is equally settled that in an
action for unlawful detainer, an allegation that the defendant is unlawfully withholding
possession from the plaintiff is deemed sufficient, without necessarily employing the
terminology of the law. Hence, the phrase “unlawful withholding” has been held to
imply possession on the part of defendant, which was legal in the beginning, having
no other source than a contract, express or implied, and which later expired as a
right and is being withheld by defendant. In Rosanna B. Barba vs. Court of Appeals,
the Supreme Court held that a simple allegation that the defendant is unlawfully
withholding possession from plaintiff is sufficient.
2. NO. The issue involved in accion reivindicatoria is the recovery of ownership of real
property. This differs from accion publiciana where the issue is the better right of
possession or possession de jure, and accion interdictal where the issue is material
possession or possession de facto. In an action for unlawful detainer, the question of
possession is primordial, while the issue of ownership is generally unessential.
Petitioners, in all their pleadings, only sought to recover physical possession of the
subject property. The mere fact that they claim ownership over the parcels of land as
well did not deprive the MTC of jurisdiction to try the ejectment case. Even if
respondents claim ownership as a defense to the complaint for ejectment, the
conclusion would be the same, for mere assertion of ownership by the defendant in
an ejectment case will not oust the municipal court of its summary jurisdiction.
Case 27: Peralta-Labrador v. Bugarin | GR no: 165177|
Date: August 25, 2005| Ponente: Ynares-Santiago, J.,
Evidence conclusively show ownership
Doctrine (Simplified Take away): Evidence that conclusively shows that the lot in question is
covered in the said title should be formally offered in evidence.
Facts: In 1976, the petitioner, Peralta-Labrador, bought Cadastral Lot No. 2650, with an area of
400 sq. m., from spouses Artemio and Angela Pronto. In 1977, she was issued a declaration
No. 10462 and paid the taxes thereon. However, in 1990, a new national highway was
constructed traversing the petitioners land, thereby separating 108 sq. m. from the rest of
petitioner’s land. As an exchange, the old highway which is west of lot 2650 was given to the
plaintiff. However, this said old highway was taken by the defendant sometime in 1994, and he
refused to vacate despite the pleas of the petitioner. In January 1996, two years after the
defendant took the said land, the petitioner instituted a complaint for recovery of possession and
ownership against respondent in the MTC. The court a quo ruled in favor of the respondent, and
this decision has been affirmed by the RTC. The petitioner’s petition for review in the CA was
denied for insufficiency of evidence to prove ownership or prior actual physical possession.
However, it deleted the respondent’s monetary award and the declaration of the MTC that the
respondent is the owner of the questioned lot. Hence, the present petition.
Issue: Is the Court of Appeals correct in ruling that the respondent is not the owner of the
questioned land?
Ruling: YES.
Ownership of the lot in question cannot be awarded to respondent considering that OCT No.
P-13011 and the Survey Plan were not formally offered in evidence. While the issue of
ownership may be passed upon in ejectment cases for the sole purpose of determining the
nature of possession, no evidence conclusively show that the lot in question is covered by said
OCT No. P-13011 or any title of respondent.
Case 28: Serina v. Caballero | GR no: 127382|

Date: August 17, 2004| Ponente: CALLEJO, SR., J.
Identity of the land being claimed
Doctrine (Simplified Take away): a person who claims ownership of real property is
duty-bound to clearly identify the land being claimed, in accordance with the title on which he
anchors his right of ownership.
Facts: A complaint for quieting of title, recovery of possession, and damages was filed by the
petitioners against the respondents. The petitioners alleged that they are the owners of the said
property and have been in actual and constructive possession for thirty-five (35) years.
However, it appears that the boundaries alleged by the petitioners is different compared to the
boundaries given in the deed of sale. Moreover, according to the petitioners, the property they
are claiming has an area of 2.5 hectares, but in the deed of sale, it shows that the property has
an area of 5 hectares. The respondent for his part alleged that he was the lawful owner and had
been in actual possession of the disputed land since time immemorial. He furthered that the
said land was originally owned by his grandfather, Eustaquio Caballero. The RTC rendered a
decision dismissing the complaint and upholding the right of the respondents over the land. The
petitioner filed a Motion for consideration but was denied by the CA. Hence, this present petition
wherein the petitioners contend, among others, that the RTC erred in ruling that the alleged
identity of the land is unestablished.
Issue: Whether or not the petitioners were able to establish the identity of the land being
claimed by them.
Ruling: NO. The petitioners were not able to establish the identity of the land being
claimed by them.
The invariable rule provides that a person who claims ownership of real property is duty-bound
to clearly identify the land being claimed, in accordance with the title on which he anchors his
right of ownership. Moreover, for an action for recovery of possession to prosper, it is
indispensable that he who brings the action fully proves his ownership and the identity of the
property claimed by describing the location, area and boundaries thereof. In the case at hand,
the petitioners failed to establish the identity of the property based on the allegations they
provided. The court noted that the land described in the complaint appears to be different from
the land described in the deed of sale, the petitioners also claimed that the land they are
claiming has an area of 2.5 hectares, but the deed of sale provides that the property has an
area of 5 hectares, and in the complaint, the petitioner provided that the property is in
“Mantadiao, Opol, Misamis Oriental” while the deed of sale shows that the property is in
“Puntakon, Igpit, Cagayan Or. Misamis.”
Case 29: Montalbo v. Mendoza| GR no:L-22006 |

Date: July 28, 1975| Ponente: MUNOZ PALMA, J.
Presumption of ownership
Doctrine (Simplified Take away): possession is an indicium of ownership and to the
possessor goes the presumption that he holds the thing under a claim of ownership.
Facts: an action to quiet title over a piece of land was filed by the petitioner herein against the
respondent. The former alleged that the questioned land was originally owned by the father of
one of the petitioners, Petra, and was passed to the children Petra, Felisa, and Pedro upon the
death of the father. Then, Pedro died single, so the two women remained as the only heirs. The
land was mutually divided between the two, and the questioned lot was assigned to Felisa.
However, Felisa’s husband sold the said share to the petitioners, and the latter leased it to the
respondents. On the other hand, the respondent contended that the said land was owned by the
mother of one of the respondents and was given to them on the occasion of their marriage.
They furthered that the said land was acquired by the mother through barter with Felisa and that
the other half of the land was donated to the municipality for use as a school site. The trial court
rendered judgment declaring the respondents to have a better right to the property in question.
The petitioner then elevated the case to the CA, which affirmed in toto the finding of the RTC.
Hence, the present petition.
Issue: Who has a better right to the property in question?
Ruling: The respondents have a better right to the property.
Art. 433 of the Civil Code provides that possession is an indicium of ownership and to the
possessor goes the presumption that he holds the thing under a claim of ownership. Moreover,
Article 538 of the Civil Code provides that if there is a question regarding the fact of possession,
the present possessor shall be preferred; if there are two possessors, the one longer in
possession shall be preferred. In the case at hand, the respondents have been occupying the
land since 1927. One of their neighbors who was a judge also testified that since the
aforementioned year, the respondents are the ones living in the said land. Moreover, when a
road was to be constructed which would traverse the said land, the provincial authorities dealt
with the respondent, and the trial court and the appellate court found for a fact that there was an
exchange of lands between Felisa and the mother of the respondents on the basis of evidence.
Hence, the right should be granted to the respondents.
Case 30: Dizon v. CA| GR no: 101929|

Date: January 6, 1993| Ponente: PADILLA, J.
Land titles: indefeasible and incontrovertible upon expiration of the one-year period

It is fundamental and well-settled that a final judgment in a cadastral proceeding - a proceeding
in rem - is binding and conclusive upon the whole world.
Facts: A complaint before the RTC was filed by the respondents herein seeking the annulment
of a deed of extrajudicial settlement and partition of the estate of Dionisio Galang, claiming to
have been deprived of their shares as co-owners. For their part, the respondents herein alleged
that they are the heirs of the sisters of Dionisio Galang and that Dionisio and his sisters
contributed the money needed for the discharge of the land which was mortgaged to a certain
Angeles family. They also furthered that Dionisio Galang redeemed the said land in his own
name. The trial court upheld Galand’s ownership to which the respondent appealed. The
appellate court reversed the decision of the RTC and declared the co-ownership. Hence, this
present case filed by the petitioners.
Issue: Whether or not the respondents can validly assert their rights to the said property
Ruling: NO.
It is fundamental and well-settled that a final judgment in a cadastral proceeding - a proceeding
in rem - is binding and conclusive upon the whole world. Moreover, the final judgment of a
proceeding in rem becomes indefeasible and incontrovertible upon the expiration of one year
from the entry of the decree. In the case at hand, the original certificates of title were issued on
January 9, 1922, to Galang, but respondents did not raise any objection until 61 years later,
which is already way over the prescription period. Moreover, the court added that the
respondents failed to establish their relationship to Galang’s five sisters and such was premised
on their claim that they are the descendants of the deceased the said sisters.
Case 31: UNITED STATES

v.
CAUSBY ET UX | 328 U.S. 256 (1946)|
May 27, 1946| USTICE DOUGLAS
Easements

1. It is ancient doctrine that at common law ownership of the land extended to the
periphery of the universe — Cujusest s olum ejus est usque ad coelom. But that
doctrine has no place in the modern world. The air is a public highway, as
Congress has declared. Were that not true, every transcontinental flight would
subject the operator to countless trespass suits. Common sense revolts at the
idea. To recognize such private claims to the airspace would clog these
highways, seriously interfere with their control and development in the public
interest, and transfer into private ownership that to which only the public has a
just claim.
2. Airspace is a public highway. Yet it is obvious that if the landowner is to have full
enjoyment of the land, he must have exclusive control of the immediate reaches
of the enveloping atmosphere. Otherwise buildings could not be erected, trees
could not be planted, and even fences could not be run. The principle is
recognized when the law gives a remedy in case overhanging structures are
erected on adjoining land. The landowner owns at least as much of the space
above the ground as he can occupy or use in connection with the land.
3. While the owner does not in any physical manner occupy that stratum of airspace
or make use of it in the conventional sense, he does use it in somewhat the
same sense that space left between buildings for the purpose of light and air is
used. The superadjacent airspace at this low altitude is so close to the land that
continuous invasions of it affect the use of the surface of the land itself. We think
that the landowner, as an incident to his ownership, has a claim to it and that
invasions of it are in the same category as invasions of the surface.
Facts: Respondents own 2.8 acres near an airport outside of Greensboro, North Carolina. It
has on it a dwelling house, and also various outbuildings which were mainly used for raising
chickens. Various aircraft of the United States use this airport — bombers, transports and
fighters. In every event that such aircraft use the airport, a great disturbance resulted to
respondents. The noise is startling. And at night the glare from the planes brightly lights up
the place. As a result of the noise, respondents had to give up their chicken business. As
many as six to ten of their chickens were killed in one day by flying into the walls from fright.
The total chickens lost in that manner was about 150. Production also fell off. The result
was the destruction of the use of the property as a commercial chicken farm. These are the
essential facts found by the Court of Claims. On the basis of these facts, it found that
respondents' property had depreciated in value. It held that the United States had taken an
easement over the property on June 1, 1942, and that the value of the property destroyed
and the easement taken was $2,000. Petitioner US appeals to this Court, arguing that since
these flights were within the minimum safe altitudes of flight which had been prescribed,
they were an exercise of the declared right of travel through the airspace. The United States
concludes that when flights are made within the navigable airspace without any physical
invasion of the property of the landowners, there has been no taking of property.
Issue: WON the United States had taken an easement over the property?
Ruling: YES. There would be an intrusion so immediate and direct as to subtract from the
owner's full enjoyment of the property and to limit his exploitation of it. While the owner does
not in any physical manner occupy that stratum of airspace or make use of it in the
conventional sense, he does use it in somewhat the same sense that space left between
buildings for the purpose of light and air is used. The superadjacent airspace at this low
altitude is so close to the land that continuous invasions of it affect the use of the surface of
the land itself. We think that the landowner, as an incident to his ownership, has a claim to it
and that invasions of it are in the same category as invasions of the surface In this case, the
damages were not merely consequential. They were the product of a direct invasion of
respondents' domain. As stated in United States v. Cress, 243 U.S. 316, 328, ". .. it is the
character of the invasion, not the amount of damage resulting from it, so long as the
damage is substantial, that determines the question whether it is a taking."
Case 32: NICOLAS LUNOD, ET AL. vs. HIGINO MENESES | G.R. No. 4223 |
August 19, 1908| TORRES, J.
Easements
1. An easement is a charge imposed upon one estate for the benefit of another estate belonging
to a different owner.
2. Article 552 of the Civil code: Lower estates must receive the waters which naturally and
without the intervention of man descend from the higher estates, as well as the stone or earth
which they carry with them. Neither may the owner of the lower estates construct works
preventing this easement, nor the one of the higher estate works increasing the burden.
3. Article 111 in the Law of Waters provides: Lands situated at a lower level are subject to
receive the waters that flow naturally, without the work of man, from the higher lands together
with the stone or earth which they carry with them.
Facts: Nicolas Lunod and other residents of Bulacan filed a complaint against Higino Meneses,
alleging that they each owned and possessed farm lands, situated in places relatively higher
than the land of the defendant. The plaintiffs stated in their complaint that during the rainy
season the rain water, especially during flood time, would fall on their land would naturally flow
down through the defendant’s property and into the dam in their place. But the defendant
recently made changes to his land by constructing a fish pond which resulted to prevent the free
passage of the water through said place into the river, that in consequence the lands of the
plaintiff became flooded and damaged by the stagnant waters, there being no outlet except
through the defendant’s land. The plaintiffs claimed that the tract of land where the fish pond
was situated is subject to a statutory easement and therefore asked the defendant be ordered to
remove and destroy the obstructions that impede the passage of the waters in his land and he
abstain from closing in any manner the aforesaid tract of land. the defendant answered the
complaint denying each and every one of the allegations, and alleged that no statutory
easement existed because he owned the area and boundaries of the land which he and his
brothers had inherited from their deceased mother.
Issue: Whether or not the defendant’s property, being the lower land, is subject to the easement
of receiving and giving passage to the waters proceeding from the higher lands owned by the
plaintiffs.
Ruling: Yes, the defendant’s property is subject to statutory easement. According to Article 552
of the Civil code and article 111 of the special law cited in the Law of Waters, lands situated at a
lower level are subject to receive the waters that flow naturally, without the work of man, from
the higher lands together with the stone or earth which they carry with them. Hence, the owner
of the lower lands cannot erect works that will impede or prevent such an easement or charge,
constituted and imposed by the law upon his estate for the benefit of the higher lands belonging
to different owners; neither can the latter do anything to increase or extend the easement.
Case 33: In the matter of the testate estate of Emil Maurice Bachrach, deceased. MARY
McDONALD BACHRACH
vs.
SOPHIE SEIFERT and ELISA ELIANOFF
| G.R. No. L-2659 |
October 12, 1950| OZAETA, J.
Usufructs

Usufruct - A usufruct is a legal right accorded to a person or party that confers the temporary
right to use and derive income or benefit from someone else's property.
ART. 474. Civil fruits are deemed to accrue day by day, and belong to the usufructuary in
proportion to the time the usufruct may last.
ART. 475. When a usufruct is created on the right to receive an income or periodical revenue,
either in money or fruits, or the interest on bonds or securities payable to bearer, each matured
payment shall be considered as the proceeds or fruits such right.
When it consists of the enjoyment of the benefits arising from an interest in an industrial or
commercial enterprise, the profits of which are not distributed at fixed periods, such profits shall
have the same consideration.
In either case they shall be distributed as civil fruits
Facts:
The deceased E. M. Bachrach, who left no forced heir except his widow Mary McDonald
Bachrach, in his last will and testament made various legacies in cash and willed the remainder
of his estate. The estate of E. M. Bachrach, as owner of 108,000 shares of stock of the Atok-Big
Wedge Mining Co., Inc., received from the latter 54,000 shares representing 50 per cent stock
dividend on the said 108,000 shares. On June 10, 1948, Mary McDonald Bachrach, as
usufructuary or life tenant of the estate, petitioned the lower court to authorize the Peoples Bank
and Trust Company, as administrator of the estate of E. M. Bachrach, to transfer to her the said
54,000 shares of stock dividend by endorsing and delivering to her the corresponding certificate
of stock, claiming that said dividend, although paid out in the form of stock, is fruit or income and
therefore belonged to her as usufructuary or life tenant. Sophie Siefert and Elisa Elianoff, legal
heirs of the deceased, opposed said petition on the ground that the stock dividend in question
was not income but formed part of the capital and therefore belonged not to the usufructuary but
to the remainderman. While appellants admit that a cash dividend is an income, they contend
that a stock dividend is not, but merely represents an addition to the invested capital.
Issue:
Whether or not a dividend is an income and whether it should go to the usufructuary.
Ruling:
The stock dividend (108,000 shares of stock) are part of the property in usufruct.
Pursuant to articles 474 and 475 of the Civil code which states that when a usufruct is
created on the right to receive an income or periodical revenue, either in money or
fruits, or the interest on bonds or securities payable to bearer, each matured payment
shall be considered as the proceeds or fruits such right. It is understood that the 54,000
shares of stock dividend are deemed civil fruits of the original investment. They
represent profits, and the delivery of the certificate of stock covering said dividend is
equivalent to the payment of said profits.
Case 34: Bachrach Motor Co. vs. Talisay-Silay Milling Co.
| G.R. No. 35223 |
September 17, 1931| ROMUALDEZ, J.
Related Topic to the syllabus

1. Article 355 of the Old Civil Code considers three things as civil fruits: First, the rents
of buildings; second, the proceeds from leases of lands; and, third, the income from
perpetual or life annuities, or other similar sources of revenue. It may be noted that
according to the context of the law, the phrase "u otras analogas" refers only to rent
or income, for the adjectives "otras" and "analogas" agree with the noun "rentas," as
do also the other adjectives "perpetuas" and "vitalicias." That is why we say that by
"civil fruits" the Civil Code understands one of three and only three things, to wit: the
rent of a building, the rent of land, and certain kinds of income.
Facts: The petitioner is Bachrach Co., a private corporation is the creditor of a mortgagor. While
the respondent Talisay, is a sugar central indebted to PNB, the creditor bank, which is also a
respondent in this case. The petitioner Bachrach Co. is the creditor of Mariano Ledesma.
Mariano Ledesma is a planter of Talisay Co. and one of the owners of the hacienda which had
been mortgaged to PNB to guarantee the debt of Talisay to said creditor banker. The case
arose because of a complaint filed by the petitioner against Talisay-Silay Milling for the recovery
of sum of money against the bonus or dividend which Talisay declared in favor of Mariano
Ledesma. Talisay bound itself to pay the planters who mortgaged their land by virtue of a
resolution passed on Dec. 23, 1923. The PNB filed a complaint in intervention alleging that it
had a preferred right to said bonus granted by Talisay to defendant because said properties
were mortgaged to it to secure the obligations of the Ptalisay-Silay Milling Co., Inc. and said
bonus being a civil fruit of the mortgaged lands.
Issue: WON the bonus in question is a civil fruit and hence should pertain to PNB on account of
the mortgage on Ledesma’s land?
Ruling: No. It is not one of those meant by Art. 442 (355a) of the Civil Code when it says “other
similar income” since the phrase merely refers to things analogous to rents, leases, and
annuities. Assuming that it is income, it is not income obtained or derived from the land itself,
but obtained as compensation for the risk assumed by the owner. It should, moreover, be
remembered that the bonus was not based upon the value or importance of the land but upon
the total value of the debt secured. The bonus had no immediate relation to the lands in
question but merely a remote and accidental one and, therefore, it was not a civil fruit of the real
properties mortgaged to PNB.
If this bonus be income or civil fruits of anything, it is income arising from said risk, or, if one
chooses, from Mariano Lacson Ledesma's generosity in facing the danger for the protection of
the central, but certainly it is not civil fruits or income from the mortgaged property, which, as far
as this case is concerned, has nothing to do with it. Hence, the amount of the bonus, according
to the resolution of the central granting it, is not based upon the value, importance or any other
circumstance of the mortgaged property, but upon the total value of the debt thereby secured,
according to the annual balance, which is something quite distinct from and independent of the
property referred to.

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Case 1: Davao Saw Mill v.

Castillo | GR no: L-40411 |

August 7, 1935 | Ponente: Malcolm, J.

Rights as Property | Personal Property

​ achinery which is movable in its

tenant or a usufructuary or any person having only a temporary right.

WON the machineries and equipments were personal in nature.

Case 2: B.H Berkenkotter v. Cu Unjieng | GR no: L-41643 |

July 31, 1935 | Ponente: Villareal, J.

Rights as Property | Real Property

Case 3: Lopez v. Orosa | GR nos: L-10817-18 |

February 28. 1958 | Ponente: Felix, J.

Immovable Property; Materialman’s lien

Case 4: Tumalad v. Vicencio | GR nos: L-30173 |

September 30, 1971 | Ponente: Reyes, J.B.L., J.

Immovable Property; Personal Property

Case 8: Meralco Co v. Bd. of Assessment Appeals| G.R. No. L-47943 |

DOCTRINE: ​The Code contains the following definition in its section 3:

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

Case 9: Caltex v. Bd. of Assessment Appeals | G.R. No. L-50466 |

DOCTRINES: A structure constitutes an improvement so as to partake of the status of realty

Whether or not the dam is considered as an improvement? (If it is an improvement it is real

A: La Bugal B’laan Tribal Association v. Ramos | GR 127882

Date: January 27, 2004 | Ponente: Carpio-Morales J.

B: La Bugal B’laan Tribal Association v. Ramos | GR 127882

Date: December 1, 2004 | Ponente: Panganiban J.

C: La Bugal B’laan Tribal Association v. Ramos | GR 127882

Date: February 1, 2005 | Ponente: Puno, Clerk of Court

(note: the SC only said here that the MR is a mere rehash)

Although Section 2 allows the participation of foreign-owned corporations in the exploration,

2. The size of the activities: only large-scale exploration, development, and

3. The natural resources subject of the activities is restricted to minerals, petroleum

4. Consistency with the provisions of statute.The agreements must be in accordance

5. The agreements must be based on real contributions to economic growth and

7. The notification requirement. The President shall notify Congress of every

Legal History of the Use of State Property

-​ ​THE 1935 CONSTITUTION: IT NATIONALIZED NATURAL RESOURCES​. The 1935

-​ ​PRESIDENTIAL DECREE NO. 87 (1972), THE 1973 CONSTITUTION AND THE

regard to Filipino participation in the nation's natural resources.

Date: July 9, 2002 | Ponente: Carpio J.

Date: May 6, 2003 | Ponente: Carpio J.

Date: November 11, 2003 | Ponente: Carpio J.

Case A:​ NO. It is invalid and unconstitutional.

G.R. No. 155055 : January 26, 2005

Article 420 (Civil Code):

The following things are property of public dominion:

NOTE: Creek- Part of the direct provision “others of similar character”

·​ ​A certification from the Second Manila Engineering District

·​ ​Photographs showing the abundance of water lilies

G.R. No. L-24950 : March 25, 1926

Article 423 (Civil Code):

Article 424 (Civil Code):

THE PROVINCE OF ZAMBOANGA DEL NORTE, ​plaintiff-appellee v.​ CITY OF ZAMBOANGA,

G.R. No. L-24440 : March 28, 1968

Article 423 (Civil Code):

Article 424 (Civil Code):

G.R. No. L-29788 : August 30, 1972

Article 423 (Civil Code):

Article 424 (Civil Code):

Case 19: Cebu Acetylene vs Bercilles | GR no: L-40475 |

Case 21: Mun. of San Miguel vs. Fernandez | GR no: L-61744 |

Case 21: Government vs. Cabangis | GR no: 28379 |

achinery which is movable in its

DOCTRINE: The Code contains the following definition in its section 3:

- THE 1935 CONSTITUTION: IT NATIONALIZED NATURAL RESOURCES. The 1935

- PRESIDENTIAL DECREE NO. 87 (1972), THE 1973 CONSTITUTION AND THE

Case A: NO. It is invalid and unconstitutional.

· A certification from the Second Manila Engineering District

· Photographs showing the abundance of water lilies

THE PROVINCE OF ZAMBOANGA DEL NORTE, plaintiff-appellee v. CITY OF ZAMBOANGA,

An Accion Publiciana; Accion Reinvindicatoria; Words and Phrases; An accion

2. NO. ACCION PUBLICIANA OR PLENARIA DE POSESION is the proper action. In an

Issue: Who has a better right to the property in question?

Ruling: The respondents have a better right to the property.