PROPERT MOCK BAR

August 8, 2020

I.
Luis was charged with theft. The information alleges that Luis stole the international
long distance calls belonging to PLDT by conducting International Simple Resale (ISR),
which is a method of routing and completing international long distance calls using
lines and air wave frequency which connect directly to the domestic facilities of the
country where the call is destined, effectively stealing this business from PLDT while
using its facilities. Luis filed a motion to quash the information on the ground that
international long distance calls and the business of providing telecommunication
services are not personal property which may be the subject of theft under Article 308 of
the Revised Penal Code.

a) Are international long distance calls personal property of PLDT which may
be the subject of theft?
b) Is the business of providing telecommunication services personal property
which may be the subject of theft?

SUGGESTED ANSWER:

(a)

No, international long distance calls are not personal property of PLDT which
may be the subject of theft.

In a case involving similar facts, the Supreme Court held that international long
distance calls are not the personal property of PLDT. The reason is that PLDT could not
have acquired ownership over such calls since it merely transmits the said calls using its
communications facilities.

(b)

Yes, the business of providing telecommunications services is a personal

property which may the subject of theft.

The Supreme Court has held that interest in business, as well as the business
itself, is personal property and hence may be the subject of theft.
 Here when Luis used the facilities of PLDT without its consent, he was
unlawfully taking the telephone services and business of PLDT.

Hence such business is personal property which may be the subject of theft. [Luis
v. Abrogar, G.R. No. 155076, 13 January 2009].

II

Edwin bought a parcel of land (Lot 1) from Subprime Bank, which acquired the
same from Felix, the original owner. Thereafter, Edwin discovered that there was a
right of way over Lot 1 in favor of the land of Greg (Lot 2) and that the purpose of the
right of way was to afford Lot 2 an adequate outlet to a public highway. The easement
however was not registered and annotated on the certificate of title over Lot 1. Edwin
comes to you for legal advice on whether he is still bound to respect the right of way in
favor of Lot 2. What would be your advice?

SUGGESTED ANSWER:

I would advise Edwin that he is still bound to respect the right of way in favor of
Lot 2.

The Supreme Court has held that the failure to annotate the legal easement of
right of way on the servient estate’s title does not extinguish the easement, since the
basis of the easement is necessity.

Here there was a legal easement of right of way in favor of Lot 2 since it is
without an adequate outlet to a public highway [Art. 649, Civil Code].

Hence the right of way was not extinguished and Edwin is still bound to respect
it.

III.
State and explain whether the following are real or personal property:
a) Rice crop mortgaged by a farmer to the Mauban Rural Bank.
b) Movie projector installed by the movie house proprietor in the movie house
he owns.
c) The interest of a contractor in a government contract for the construction of a
road between two rural towns.
d) Leasehold right of a lessee in a one-year lease of a commercial building.
e) PLDT undersea internet cables.
 SUGGESTED ANSWER:
(a)
Rice crop mortgaged by a farmer to a bank is personal property.
Under the Chattel Mortgage Law, growing crops which have been mortgaged
are considered as personal property.
(b)
A movie projector installed by the movie house proprietor in the movie house he
owns is real property.
Under the Civil Code provisions on Property, machinery or instruments
intended by the owner of the building for a business carried on in such building and
which tend directly to meet the needs of the business are real property. [Article 415(5),
Civil Code]
Here the movie projector is a machinery or instrument which directly meets the
needs of the movie house business and it was so intended by the movie house owner
for the business since he was the one who installed it.
(c)
The contractor’s interest in a government contract for road construction is
personal property.
Under the Civil Code provisions on Property, obligations which have for their
object demandable sums are personal property. [Article 417(2), Civil Code]
Here the contractor’s interest in a government contract is an obligation which has
for its object a demandable sum, that is, the contract price owing from the government.
(d)
The lessee’s leasehold right in a one-year lease of a commercial building is
personal property.
Under the Law on Property, a personal right over an immovable is personal
property. [See Article 415(10) which speaks of “real rights over immovable property”]
Here the lessee’s leasehold right over the commercial building is only a personal
right since the lease does not exceed one year.
Hence the lessee’s leasehold right is personal property.
(e)
PLDT undersea internet cables are personal property.
Under the Law on Property, objects which can be removed from the soil or land
without causing deterioration thereon are considered as personal property.
Here the undersea cables can be removed from the seabed without causing
deterioration thereto.
Note: The problem did not mention anything about real property tax, so the rule
in the Civil Code and not the Local Government Code applies.
IV.
Ambo is a chess buff who has a rare copy of the official tournament book of the Karpov
vs. Korchnoi World Chess Championship Match held in Baguio City in 1978. Botchok,
who is Ambo’s friend, borrowed the book from Ambo. However instead of returning
the book, Botchok sold and delivered it for ₱25,000 to Coco, who bought the book in
good faith. Later on Ambo discovered that the book is in the hands of Coco.
a) May Ambo recover the book from Coco?

b) Assume that instead of borrowing the book, Botchok had bought the same by
issuing a check for P10,000 to Ambo. When Ambo presented the check, it was
dishonored for having been drawn against insufficient funds. In the
meantime Botchok sold and delivered the book for P25,000 to Coco, who
bought the book in good faith. May Ambo recover the book from Coco?

SUGGESTED ANSWER:

(a)

Yes, Ambo may recover the book from Coco.

Under the Civil Code provisions on Property, an owner of a movable who has
been unlawfully deprived thereof may recover it from the person in possession of the
same. [Article 559].

Here Ambo was unlawfully deprived of his book, a movable, by Botchok

through estafa since Botchok had a duty to return the book which was the subject of a
commodatum.

Hence Ambo may recover the book from its possessor Coco.

(b)

No, Ambo may not recover the book from Coco.

Under the Law on Sales, the owner of a movable who had been unlawfully
deprived thereof may no longer recover the same from a buyer in good faith who had
bought and obtained delivery from a seller with a voidable title but whose title had not
yet been annulled. (Art. 1506; EDCA Publishing v. Santos, 26 April 1990).
 Here Coco, a buyer in good faith had bought and obtained delivery from
Botchok who had a voidable title because of fraud but whose title from the sale contract
had not yet been judicially annulled.

Hence Ambo may not recover the book from Coco.

V.
Pedro filed an action for reconveyance of Lot A against Andres. Pedro
presented a notice of lis pendens for registration with the register of deeds. The register
of deeds entered the notice in the primary entry book but failed to annotate it in the
certificate of title over the registered land. Benito who was interested in buying Lot A,
examined the certificate of title on file with the register of deeds. Not finding any lien
or claim annotated thereto, Benito bought the land from Andres. The certificate of title
in the name of Andres was cancelled and a new certificate of title was issued in the
name of Benito. Benito then constructed on the land a house costing P1,000,000. Later
Pedro won his case against Andres and the judgment became final and executory. In
due course a writ of execution was issued in favor of Pedro directing the reconveyance
of Lot A to Pedro.
a) May the writ of execution be enforced against Benito?

b) What right, if any, does Benito have against Pedro?

SUGGESTED ANSWER:
(a)
Yes, the writ of execution may be enforced against Benito.
The Supreme Court has held that the entry of a transaction over a parcel of
registered land in the primary entry book is sufficient for purposes of registration and
hence such attachment is binding upon third parties.
Here the transaction involving the writ of attachment was already entered in the
primary entry book at the time Benito bought the land and is thus binding upon him.
Hence the writ of attachment may be enforced against Benito. [Caviles v.
Bautista, G.R. No. 102648, 24 Nov 99].
(b)
Benito has the right of indemnification and retention against Pedro.
The Supreme Court has held that a buyer who buys registered land on which a
lien or encumbrance has been registered but not annotated on the certificate of title is
considered a builder in good faith having the right of indemnification and retention
against the owner.
 Here Benito is a buyer in good faith since the writ of attachment was not
annotated on the certificate of title at the time he bought it. [Saberon v. Ventanilla, 21
April 2014, Mendoza, J.]
Hence Benito has the right to be indemnified of his cost of P1,000,000 in erecting
the house or improvement and to retain possession of Lot A until he is indemnified.

VI.
Saul sold his registered land in favor of Brenda. Under the terms of the notarized deed
of absolute sale, Brenda paid a downpayment of P400,000 and the balance of P600,000
would be paid 30 days thereafter. Pending full payment, Saul retained the owner’s
duplicate certificate of title over the land. Exasperated that Brenda had not yet paid
the P600,000 despite the lapse of more than 30 days, Saul entered into negotiations with
Marissa for the sale of the same lot. Brenda learned of the negotiations and filed with
the register of deeds an affidavit of adverse claim stating that there was a contract of
absolute sale entered into between her and Saul. The affidavit was entered in the
primary entry book and annotated on the certificate of title. Two months after the
registration of the adverse claim, Marissa went to the register of deeds and examined
the certificate of title of Saul. She noticed that the adverse claim was registered more
than two months earlier. Marissa thus bought the lot from Saul, paying him P1 million.
The deed of absolute sale between Saul and Marissa was registered and the title in the
name of Saul was cancelled and a new certificate of title in the name of Marissa was
issued. The certificate of title still contained the adverse claim since it was never
cancelled. Brenda filed an action for the nullification of the sale in favor of Marissa
alleging that the deed of sale in favor of Marissa was void because the land had been
sold earlier to her. Who between Brenda and Marissa has a better right to the land?
Explain.

SUGGESTED ANSWER:

As between Brenda and Marissa, it is Marissa who has the better right to the
land.

The Supreme Court has held that an ineffective adverse claim cannot prejudice
the rights of a subsequent purchaser for value who would thus be considered as being
innocent or in good faith. Under the Property Registration Decree, an adverse claim is
effective only if there is no other provision in the decree for the registration of the
claimant’s adverse interest.
 Here the adverse claim filed by Brenda was ineffective because her adverse
interest in the form of a deed of absolute sale could have been registered as a voluntary
instrument pursuant to the Property Registration Decree.

Hence Brenda’s adverse claim was ineffective and did not prejudice the rights of
Marissa who is thus considered as an innocent purchaser for value.

VII.
Marla owned a registered parcel of land under Transfer Certificate of Title (TCT)
No. 1234. The spouses Ventanilla filed an action for specific performance over the land
against Marla. The trial court rendered judgment ordering Marla to execute an absolute
deed of sale over the land in favor of the spouses Ventanilla. In January 1991, pursuant
to the judgment, a notice of levy on execution in favor of the spouses Ventanilla over
the land covered by TCT No. 1234 was entered in the primary entry book but was not
annotated on TCT No. 1234. In May 1991, Marla sold the land to the spouses Saberon
who examined the certificate of title and found no encumbrance thereon. A new TCT
No. 5678 was issued in favor of the Saberons. The Saberons built a house thereon. In
1992, upon learning of the transfer of title to the Saberons, the Ventanillas forthwith
filed an action to nullify the certificate of title issued in favor of the Saberons and to
demolish the house built by the Saberons.

a) May the certificate of title in the Saberons’ names be nullified? Explain.

b) May the trial court order the demolition of the house built by the Saberons?
Explain.

SUGGESTED ANSWER:

(a)

Yes, the certificate of title in the Saberons’ names may be nullified.

The Supreme Court has held that entry of a transaction or deed in the primary
entry book is sufficient registration and will bind a subsequent purchaser whose
certificate of title may accordingly be nullified.

Here the deed or notice of levy on execution was entered in the primary entry
book.
 Hence the notice of levy on execution was sufficiently registered and is thus
binding upon the subsequent purchasers who are the Saberons. Thus the certificate of
title in the Saberons’ names may be nullified. [Saberon v. Ventanilla, 21 April 2014]

(b)

No, the trial court may not order the demolition of the house built by the
Saberons.

In a case involving similar facts, the Supreme Court held that the purchaser who
was unaware of a prior registered lien because of the failure to annotate the lien and
who builds on the land bought is a builder in good faith.

Since the Saberons are builders in good faith, the owner spouses Ventanilla do
not have the right of demolition as against them.

Hence the trial court cannot order the demolition of the house. [Art. 448,
Saberon v. Ventanilla]

VIII.
Give ten examples of property of public dominion.
Article 420. The following things are property of public dominion:
(1) Those intended for public use, such as roads, canals, rivers, torrents, ports
and bridges constructed by the State, banks, shores, roadsteads, and others of
similar character;
(2) Those which belong to the State, without being for public use, and are
intended for some public service or for the development of the national wealth.
(339a)

IX.
Give ten examples of immovable property under the Civil Code.
Article 415. The following are immovable property:
(1) Land, buildings, roads and constructions of all kinds adhered to the soil;
(2) Trees, plants, and growing fruits, while they are attached to the land or form
an integral part of an immovable;
(3) Everything attached to an immovable in a fixed manner, in such a way that it
cannot be separated therefrom without breaking the material or deterioration of
the object;
 (4) Statues, reliefs, paintings or other objects for use or ornamentation, placed in
buildings or on lands by the owner of the immovable in such a manner that it
reveals the intention to attach them permanently to the tenements;
(5) Machinery, receptacles, instruments or implements intended by the owner of
the tenement for an industry or works which may be carried on in a building or
on a piece of land, and which tend directly to meet the needs of the said industry
or works;
(6) Animal houses, pigeon-houses, beehives, fish ponds or breeding places of
similar nature, in case their owner has placed them or preserves them with the
intention to have them permanently attached to the land, and forming a
permanent part of it; the animals in these places are included;
(7) Fertilizer actually used on a piece of land;
(8) Mines, quarries, and slag dumps, while the matter thereof forms part of the
bed, and waters either running or stagnant;
(9) Docks and structures which, though floating, are intended by their nature and
object to remain at a fixed place on a river, lake, or coast;
(10) Contracts for public works, and servitudes and other real rights over
immovable property

X.
Give six examples of immovable property under the Civil Code.
Article 416. The following things are deemed to be personal property:
(1) Those movables susceptible of appropriation which are not included in the
preceding article;
(2) Real property which by any special provision of law is considered as
personalty;
(3) Forces of nature which are brought under control by science; and
(4) In general, all things which can be transported from place to place without
impairment of the real property to which they are fixed. (335a)
Article 417. The following are also considered as personal property:
(1) Obligations and actions which have for their object movables or demandable
sums; and
(2) Shares of stock of agricultural, commercial and industrial entities, although
they may have real estate