1. Ladera vs. Hodges
Hence, for the
Facts: Ladera entered into a contract with Hodges wherein the
latter promised to sell a lot to be paid monthly. The agreement
also stated that if Ladera failed to make monthly payment, the
will re rescinded and annulled, thus all the payments made will be
regarded as rentals, and Hodges will again acquire the disposition
of the lot with all the improvements.
Ladera built a house on said lot. Consequently, the latter
defaulted which called upon the rescission of the contract and the
ejectment suit by Hodges. The lot was sold through auction sale
to one Avelina Magno, meanwhile, Ladera also sold the same lot
to Manuel Villa which sale was not recorded.
When Ladera learned about the auction sale, she offered the to
redeem the property and paid a sum to the sheriff, which
appeared, however, that was not turned over to Hodges.
Therefore, Ladera filed an action to set aside the sales and recover
the house.
The judgment was declared in favor of Ladera and the sale was set
aside for non-compliance with Rule 39 of the Rules of Court
regarding judicial sales of real property. On the other hand,
Hodges filed an appeal contending that the house built on the lot,
being owned by another, should be considered as movable or
personal property and not a real property.
Issue: W/N the house should be considered as movable or
personal property
Ruling: NO.
Under Art 334 (now 415) of the CC, par. 1, immovable property
are the following: “Lands, buildings, roads and constructions of all
kinds adhering to the soil.” The law does not make a distinction as
to whether the owner of the land is or is not the owner of the
building. In the classifications of real property, an immovable by
destination requires that the immovable be placed by the owner
of the tenement in order to acquire the same nature of the land
as real property. In immovable by incorporation, it is not required
that the incorporation be made by the owner of the land.
Moreover, in principle of accession regarding the constructions
made on the land, the accession is considered to possess the
nature of the principal thing.
In this case, the object of the judgment sale was the land which is
a real property, not the house. Hence, applying the principle of
accession and as the house classified as immobilized by
incorporation, it acquired the nature of the real property or the
land to which it is built or attached.
2. Mindanao Bus Company vs. City Assessor and Treasurer
Facts: City Assessor assessed petitioner's maintenance and repair
equipments used in its public utility business of transportation of
passengers and cargoes by motor trucks for the payment of
realty. The equipments are said to be placed on wooden or
cement platforms that can be moved around in petitioner's repair
shop. Peritioner appealed to the Board of Tax Appeals contending
that the equipments are not taxable real properties.
The Board of Tax Appeals as well as the Court of Tax Appeals
favored the City Assessor based on its interpretation of par. 5 of
Art.415 of the NCC that movable properties, such as machineries,
intended for use in an industry are immobilized by destination or
purpose.
Issue: W/N the subject equipments are immovable properties
Ruling: YES.
In the case of B.H. Berkenkotter v. Cu Unjieng, the SC said that
par. 5 of Art. 415 gives the character of real property to
machinery, instruments or implements intended by the owner of
any building or land for use in connection with any industry or
trade being carried on therein and which are expressly adapted to
meet the requirements of such trade or industry.
movables to be immobilized by destination, they should be (1)
essential and principal elements in the industry, not merely
incidental, without such, the industry or work would not be able
to carry out the purpose of the industry for which it is established;
and (2) that the industry or works be carried on permanently in a
building or on a piece of land.
In herein case, regarding the first requisite, the subject
equipments, by their nature, are not essential and principal
elements of petitioner's business of transporting passengers and
cargoes by motor trucks. The equipments are merely incidental as
they are used only for the maintenance and repair of the trucks.
Even without such, the business may be carried on as the trucks
may be repaired in another shop belonging to another. As to the
second requisite, the transportation business, which is not carried
on permanently in a building or on a piece of land. Therefore, said
equipments are not considered real property, thus, not subject to
real estate tax.
3. Makati Leasing and Finance Corp. vs. Wearever Textile Mills,
Inc.
Facts: Private Respondent Wearever and petitioner Corp entered
into a Receivable Purchase Agreement, which receivables are
secured by Chattel Mortgage of raw materials and a machinery of
private respondent, in order that the latter may obtain financial
accomodations from petitioner. Later, an extrajudicial foreclosure
was filed by petitioner when private respondent defaulted. As the
deputy sheriff cannot gain entry from private respondent's
premises to foreclose the mortgaged items, a seizure order was
issued by the lower court which resulted from petitioner's
application for replevin (this is a court order that authorizes an
officer to be able to seize and hold property that is involved in a
replevin suit). Upon remedies filed by petitioner, CA ordered the
return of the seized items ruling that the machinery cannot be
subject of replevin or of a chattel mortgage, because it is a real
property pursuant to par. 5 Art 415 of NCC, the same being
attached to the ground and cannot be removed without
destroying the concrete floor. Also, CA rejected petitioner's
argument that private respondent is estopped from claiming that
the machine is a real property by constituting a chattel mortgage
thereon.
Issue: Whether or not the subject machinery is a real property as
ruled by the CA
Ruling: NO, the said machinery is a personalty.
The SC upheld the ruling of Tumalad v. Vicensio case applying the
doctrine of estoppel wherein a house was declared to be
personalty as it was treated as such by transferring it by way of
chattel mortgage executed by the defendant-appellants, thus, the
latter cannot make an inconsistent stand by claiming otherwise.
In this case, it is for a fact that private respondent characterized
the subject machinery as chattel by executing a chattel mortgage.
If a house of strong materials involved in Tumalad case can be
considered as chattel, there is absolutely no reason why a
machinery, which is movable by nature and becomes immobilized
only by destination or purpose, may not be treated as such. When
a chattel mortgage is constituted on machinery attached to the
ground, it is to be considered as personal property and the chattel
mortgage constituted thereon is not null and void, regardless of
who owns the land.
4. Santos Evangelista vs. Alto Surety and Ins. Co., Inc.
5. Tsai vs. CA
Facts: Petitioner Bank granted a total of 2 loans in favor of
EVERTEX secured by Real and Chattel mortgage of a lot, where the
company is built on, and some personal properties located
therein. After the second loan, EVERTEX purchased machines and
equipments which are bolted and cemented on the real property.
Later, EVERTEX was declared insolvent and the properties were
seized. PBCom commenced extrajudicial foreclosure proceedings
against EVERTEX and became the owner of the lot and all the
properties in it. PBCom then sold the factory, lock, stock and
barrel to Ruby Tsai. As a result EVERTEX filed a complaint for
annulment of such sale arguing that there are no rights
transferred to PBCom over the assets of insolvent EVERTEX,
therefore Tsai acquired no rights as well. In addition, EVERTEX
averred that properties not listed in the mortgages were illegally
appropriated by PBCom.
The RTC ruled in favor of EVERTEX, which the CA affirmed,
ordering the annulment of the sale and the return of the personal
properties acquired by EVERTEX after the Real and Chattel
Mortgage decree as they are not included as foreclosed.
Issue: W/N the said machineries are correctly regarded as
personal properties
Ruling: YES.
The nature of the machineries as they were cemented on the real
property does not make them ipso facto immovable under Art.
415 (3) and (5) of the NCC, as the parties' intent has to be looked
into.
In the case at bar, even the nature of the subject properties is
immovable, both the trial and the appellate court concluded that
the intention of PBCom and EVERTEX in the executed Real and
Chattel Mortgage is to trat the machineries as chattels. The
parties executed a contract of "Real and Chattel Mortgage"
instead if just "Rest Estate Mortgage" if their intention is to treat
all properties as immovable. Applying the principle of estoppel,
pursuant to Navarro v. Pineda, an immovable may be considered
a personal property of there us a stipulation as when it is used as
security in the payment of an obligation where a chattel mortgage
is executed over it.
Lastly, under Sec. 7 of the Chattel Mortgage Law, "a chattel
mortgage shall be deemed to cover only the property prescribed
therein and not like or substituted property thereafter acquired
by the mortgagor and placed in the same depository as the
property originally mortgaged."
6. Serg's Product Inc., vs. PCI
Facts: Upon complaint of sum of money with application for a writ
of replevin of PCI against petitioner, respondent judge directed
the sheriff to seize and deliver the machineries to PCI. Petitioner
filed a motion for Special Protective Order, but was opposed by
PCI on the ground that the properties were still personal and
therefore subject to seizure and a writ of replevin. In their reply,
petitioners asserted that the properties sought to be seized are
immovable as defined in Art. 415 of the CC and to give effect to
the agreement of the parties would be prejudicial to 2rd persons.
They further stated that PCI was estopped from claiming that the
machineries are personal properties because the contracts are
totally sham and farcical.
The CA held that the subject machines were personal properties,
and that they had only been leased, not owned, by the
petitioners.
Issue: Whether or not the machineries purchased and imported
by Serg's became real property by virtue of immobilization
Ruling: NO.
According to Art. 415, "(5) Machinery, receptacles 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."
In the present case, the machines that were subjects if the Writ of
Seizure were placed by petitioners in the factory built in their own
land. Said machines were essential and principal elements of their
chocolate-making industry. Hence, although the nature of them
are movable, they were immobilized by destination for being
essential and principal elements if the industry. However, the
Court held that under the principle of estoppel, the parties are
estopped from claiming otherwise after agreeing to stipulate that
a real property be considered as personal. The Lease Agreement
entered into by the parties clearly provides that the machines are
to be considered as personal property. Clearly then, the parties
are estopped from denying the characterization of the subject
machines as personal property.
7. Burgos vs. Chief of Staff
Facts: Petitioner Jose Burgos questioned the two search warrants
issued to search the premises of 2 known newspaper business
addresses where he was acting as publisher-editor and resulted to
the seizure of printing equipments and other articles used for
printing. He asserted that the two warrants are invalidly enforced
because the machines seized are real properties bolted to the
ground under Art. 415 (5) of the CC, thus, not susceptible to
seizure under search warrant.
Issue: W/N the machineries seized are real properties
Ruling: NO.
In Davao Sawmill Co. v. Castillo, the SC ruled that machinery
which is movable by nature becomes immobilized when placed by
the owner of the tenement, property or plant, but not so when
placed by a tenant, usufructuary, or any other person having only
a temporary right, unless such person acted as the agent of the
owner.
Here, petitioners do not claim to be the owners of the land and/or
building in which the machineries in question, while in fact bolted
to the ground remain movable property susceptible to seizure
under a search warrant.
8. Lopez vs. Orosa, Jr. and Plaza Theatre Inc.
Facts: Lopez and Orosa entered into verbal agreement that Lopez
will supply lumber to Orosa to be used for the construction of
Plaza Theatre where payment would be on demand basis and that
Orosa would be personally liable for any account he construction
might incur. When the theatre was constructed, it was sold to a
corporation without the payment to Lopez being satisfied. To pay
Lopez, Orosa and the president of the corporation obtained a
bank loan secure by a mortgage over the Plaza Theatre. However,
without Lopez knowing, the corporation already got a loan from
Phil. National Bank with the Luzon Surety Company as surety, and
that the land and building was mortgaged in favor of said
company as counter-security.
Persistent demand of Lopez to pay him caused Orosa to execute a
"deed of assignment" of his shares of stock in the corporation;
and as the obligation still remained unsettled, Lopez filed an
action praying for Orosa and the Plaza Theatre Inc. to pay him
being jointly and severally liable and for the building and land of
the corporation be sold in public auction in case they still failed to
pay. The lower court decided that the defendants are jointly liable
for the unpaid balance for the construction if the building in favor
if Lopez and that the latter acquired the materialman's lien over
the same. Lopez appealed the judgment contending that the
materialman's lien over the building is also extended to the land
on which the construction was made.
Issue: W/N the materialman's lien for the value of the materials
used in the construction of the building attached to the said
structure alone and does not extend to the land on which the
building as adhered to
Ruling: YES.
Art. 334 (now 415) of the CC enumerates what are considerable
immovable property, among which are land buildings, roads and
constructions of all kind adhering to the soil. Real estate connotes
the land and the building constructed thereon, it means that the
inclusion of the building, separate and distinct from the land, in
enumeration of what may constitute real properties could only
mean that a building is by itself an immovable property.
Moreover, in the absence of any specific provision of law to the
contrary, a building is an immovable property, irrespective of
whether or not said structure and the land on which it is adhered
to belong to the same person.
Art. 1923 of the Spanish CC provides: "With respect to
determinate real property and real rights of the debtor, the
following are preferred: xx (5) Credits for refection, not entered or
recorded, with respect to the real estate upon which the refection
was made, and only with respect to the other credits different
from those mentioned in four next preceding paragraphs." It gives
preference to unregistered refectionary credits only with respect
to the real estate upon which the refection or work was made.
Therefore, the lien attaches merely to the immovable property for
the construction of which the obligation was incurred. Therefore,
the lien in favor of Lopez for the unpaid value of the lumber used
in the construction of the building attaches only to the building
and does not extend to the land.
9. Yap vs. Tanada
Facts: Goulds Pumps Int'l filed a complaint against Yap for the
recovery of price balance and installation cost of a water pump in
the latter's premises. Due to Yap's unwillingness to attend in court
hearings which caused undue delay to plaintiff's cause, Judge
Tafiada ordered the execution sale of the water pump. The
auction sale was made and sold the property to Goulds as the
highest bidder. Yap then filed a motion to set aside execution sale
asserting that the sale was made without notice required by Sec.
18, Rule 39 of the RC which requires notice of publication in case
of execution sale of real property, the pump and its accessories
being immovable because attached to the ground with characted
of permanency, pursuant to Art. 415 of the CC.
Issue: W/N the water pump and its accessories are immovable
Ruling: NO.
The Court held that the CC considers as immovable property,
among others, anything "attached to an immivable in a fixed
manner, in such a way that it cannot be separated therefrom
without breaking the material or deterioration of the subject."
The pump does not fit the description. It could be, and was in fact
separated from Yap's premises without being broken or suffering
deterioration. Obviously, the separation kr removal of the pump
involved nothing more complicated than the loosening of bolts or
dismantling of other fasteners.
10. Machinery and Engineering Supplies, Inc. vs. CA
Facts: Petitioner filed a complaint for replevin for the recovery of
machineries delivered to defendant's factory. Upon the approval
of respondent judge, deputy sheriffs and technical crew
proceeded to the factory to seize the properties. On arrival, the
person in charge in the factory presented a letter by an attorney
saying that the seizure cannot be made for the reason that the
subject properties are personal properties, hence, cannot be
subject of the writ of replevin. Claiming that the execution is only
their ministerial function as deputy sheriffs, they proceeded with
the seizure even they had to cause destruction to dismantle the
machineries. After, the trial court issued to return the machines
and they did by dropping it only by the road without re-installing.
As the defendants wanted the equipments to be re-installed, the
petitioner is ordered to funish the necessary funds and laborers to
do the same. Petitioner then complained the respondent Judge
disregarded the fact that the machineries were yet his property
until fully paid and never became immovable.
Issue: W/N the subject machineries and equipments are
immovable
Ruling: YES.
The said machineries were attached to the land and cannot be
detached "without breaking the material or deterioration of the
object." Also, the machineries were "intended by the owner of
the tenement for an industry" carried in said immovable and
tended "directly to meet the needs of the said industry." For
these reasons, they were already immovable property pursuant to
par. 3 and 5 of Art. 415 of the CC. Lastly, as they are immovable
property, they were not subject to replevin as according to Rule
63 of the RC, it is only applicable to personal property.
11. Manila Electric Co vs. The City Assessor
Facts: Meralco'electric facilities, namely: (a) transformer and
electric post; (b) transmission line; (c) insulator; and (d) electric
meter, were assessed for real property tax in 1998. However, it
argued that the said facilities are not real properties citing the
1964 Meralco case in which the SC held that the steel towers fell
within the term "poles" are expressly exempted from taxes under
the franchise of Meralco and that the steel towers were personal
properties under the provision of Civil Code.
The CA held that Meralco could no longer claim the real property
tax exemption when RA 7160 or the LGC was enacted on Jan. 1,
1992 and that the properties are within the meaning of
"machinery" under Sec. 199(o) of the said code which deemed it
as real property. Hence, the properties in question are taxable
since 1992.
Meralco argued that the definition of "machinery" cited must still
be within the contemplation of immovable property under Art.
415 of the CC and that the electric poles are not exclusively used
since they are also being utilized by other cable and telephone
companies.
Issue: W/N the poles, wires, transformers, and insulators of
Meralco are immovables.
Ruling: YES, the said facilities are immovables.
In the passing of LGC, Sec. 199 (o) thereof provides that
machinery, to be deemed real property subject to real property
tax, need no longer be annexed to the land or building as these
"may or may not be attached, permanently or temporarily to the
real property," and such machinery may be "mobile." Also, it
requires that to be subject to real property tax, the facilities,
those which are mobile, self-powered or self-propelled, or not
permanently attached to the real property (a) must be actually,
directly, and exclusively used to meet the needs of the particular
industry, business, or activity; and (b) by their very nature and
purpose, are designed for or necessary for manufacturing, mining,
logging, commercial, industrial, or agricultural purposes. Thus,
Art. 290(o) of the RRI the LGC provided an exemption that
machinery of general purpose use which are not directly and
exclusively used to meet the needs of the industry are not
considered within the definition under Sec. 199(o) of the code.
However, if the definition of the LGC is to be compared to that of
what Art. 415 of the CC declared as immovables, what the LGC
provides lacks requisites than that provided by the CC. Thus, in
construing both codes, the former should be the controlling law
as it is the the more specific provision granting local government
the power to impose real property tax compared to the general
provision provided by the CC.
Nevertheless, the SC held that the appraisal and assessment of
the facilities of Meralco as machinery were not in accordance with
the LGC and in violation to due process and therefore, null and
void.
12. Capitol Wireles Inc. vs. Provincial Treasurer of Batangas
Facts: Capwire, a business providing international
telecommunications services, claims to be a co-owner of "Wet
Segment" with Asia Pacific Cable Network System (APCN), and the
landing stations are located in Batangas allegedly owned by PLDT.
It alleged that the Wet Segment submarine cable system is laid in
international and not Philippine waters. Thus, when the Provincial
Assessor of Batangas determined the submarine cables of Wet
Segment as taxable real property and assessed against Capwire, it
contested that the cable system lies outside the Philippine
territory.
Issue: W/N the submarine cable system can be classified as
taxable real property by the local government of Batangas
Ruling: YES.
The Court upheld the decision laid in Manila Electric Co vs. City
Assessor and Treasurer of Lucena City that the telecommunication
cable lines are declared as no longer exempted from real property
tax and may qualify as machinery subject to real property tax
under the LGC. Also, the Court did not distinguish between
submarine cables and aerial or underground wires, hence, both
are subject to same treatment. Both cables are indeed not directly
adhered to the soil but both may be classified under "machinery"
as real property under Art. 415 (5) of the CC for the reason that
said facilities tend to meet the needs of the industry or works that
are on real estate. Even objects on a body of water can be
classified as immovable under Art. 415(8) of the Code.
Lastly, regarding the local taxing authority of Batangas over the
said cable system, it cannot be ignored that even the said Wet
Segment lies in the international waters, the landing station falls
within the Philippine territory and thus falls within the jurisdiction
of the said local taxing authorities.
13. Laurel vs. Garcia
Facts: Philippines has entered into a Reparation Agreement with
Japan wherein the subject lot, located in Japan was one of the
four lots acquired by the Philippines as indemnification from
Japan for the damages caused by World War II. The case arose
when the President issued E.O. 296 allowing the disposition of the
reparation goods including the lots, for the reason that they have
not been used for years. The Executive branch pushed the bidding
of the lots, starting from Roppongi lot, used to be where the
Philippine Embassy in Japan was situated, to convert it into
private use.
One of the numerous oppositors was petitioner Laurel who
asserted that the lots cannot be subjected to private ownership as
they are of public dominion, citing Art. 420 of the CC. Hence, it
cannot be appropriated and considered as outside the commerce
of man. On the contrary, respondents argued that the Roppongi
lot has not been used for a long period of time, thus it became a
patrimonial property that can be alienated under Art. 422 of the
CC.
Issue: W/N Roppongi property became a patrimonial property
after not being used for public service for a long period of time
Ruling: NO, it is still a public property.
The Court held that the fact that Roppongi property has not been
used as Embassy for years does not automatically convert it into a
patrimonial property. Pursuant to the ruling in Cebu Oxygen &
Acetylene Co. v. Bercilles, such conversion happens only if the
property is withdrawn from public use. Also, in Ignacio v. Director
of Lands, it was stated that a property continues to be part of
public dominion not available for private ownership until there is
a formal proclamation on the part of the government to withdraw
it from being such.
Furthermore, the Court emphasized that the abandonment to use
Rappongi lot for public use and to make it a patrimonial property
under Art. 422 of the CC must be definite. A mere transfer to
another location of the Embassy is not a relinquishment of the
original purpose of the roppongi property. Therefore, it
maintained to be of public dominion.
14. Rabuco vs. Villegas
Facts: Petitioners were the owners of the houses sought to be
demolished and ordered to be ejected from the subject lot
situated in Manila because the houses were allegedly constructed
in violation of a city ordinance and constituted as public nuisance.
Petitioners prayed for the demolition and ejection to be set aside
and to implement R.A. 3120 and regard them as bona fide
occupants under the said law. R.A. 3120’s constitutionality was
questioned as it allegedly allows the Congress to convert the lot in
question together with another lot which are reserved communal
properties into alienable lands of the State to the tenants or bona
fide occupants. Also, it expressly prohibits the ejectment and
demolition of petitioners’ houses. Respondent contended that the
Act is unconstitutional as it deprives the City of Manila of the
mots in question and providing their sale to bona fide occupants
without just compensation.
Issue: W/N the subject lot is of public domain which renders R.A.
3120 constitutional
Ruling: YES.
Respondent’s contention is untenable. The lots are property of
City of Manila in its public and government capacity, therefore,
the Congress has absolute control over the lot; as distinguished
from patrimonial property owned in its private or proprietary
capacity, in which case the City of Manila could not be deprived
without due process and just compensation.
In this case, R.A. 3120 expressly declared that the properties are
communal property ordering their conversion to alienable and
disposable lands of the State for sale in small lots to bona fide
occupants thereof. The act of classifying the State property calls
for the exercise of legislative power, thus, R.A. 3120 is
constitutional and should be implemented.
15. Macasiano vs. Diokno
Facts: An ordinance was passed in Paranaque authorizing the
closure of designated streets to be used for flea market under
certain terms and conditions; one of those was that the
aforementioned flea market shall not be situated on streets used
for vehicular traffic. Said flea markets were placed on municipal
roads and were open for lease to be remitted to the treasury of
municipal government of Paranaque. Later, petitioner Macasiano,
ONP Superintendent, wrote a letter to respondent Palanyag, a
service cooperative, to discontinue the flea market as these
streets are of public use and not subject to private contract by any
person. Petitioner further asserted in his petition that a property
already dedicated for public use cannot be used for another
public purpose.
Issue: W/N the streets used for flea market are public property
Ruling: NO.
The Court cited Art. 424 of the CC which enumerated the property
for public use in the provinces, cities and municipalities; and one
of those are the streets. Hence, the streets where the flea market
was situated are local roads used for public service and are
therefore considered public properties of the municipality. And
these properties of the local government are deemed public and
are under the absolute control of the Congress. Thus, local
governments have no authority to regulate such unless authority
is verted upon them by Congress. An example of such authority is
the power to close roads provided in Sec. 10, Chap. 2 of the LGC,
where local governments can exercise such power for public use
provided that prejudiced persons shall be indemnified. However,
Art. 424 of the CC limits this authority as it provides that public
properties devoted for public use are outside the commerce of
men and cannot be disposed of or leased by the local government
to private persons. Only those that are patrimonial properties can
be made available for private disposal.
Applying to herein case, the subject streets were in fact already
available to the public and ordinarily used for vehicular traffic. In
such case, the local government has no power to use it for
another purpose or lease it to private persons. Therefore, the
ordinance constructing the flea market is invalid.
16. Republic vs. CA
Facts: A free patent over a land was granted to respondent
Morato with the condition that the same shall not be alienated or
encumbered within 5 years from the issuance of patent. Upon
investigation when there were reports received that respondent
Morato violated the condition, it was found that the land is a
portion of Caluag Bay and that respondent Morato mortgage and
leased 2 separate portions of the land. As a result, petitioner filed
a complaint for the cancellation of the free patent and reversion
of land to the public domain on the grounds that the land is a
foreshore land and was mortgaged and leased within the
prohibitory period. The trial court, as well as the CA, ruled in favor
of respondent Morato.
Issue: W/N the question land is part of a disposable public land
and not a foreshore land
Ruling: NO, the land is a foreshore land.
The Supreme Court defines foreshore land in the case of Republic
vs. Alagad as "that part of the land which is between high and low
water and left dry by the flux and reflux of the tides. On the other
hand, Art. 420 of the CC provides the property of public domain
which are (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; and (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 welfare.
The Court said that when the sea moved towards the estate and
tide invaded it, the invaded property became foreshore land and
became public domain. Here, when the free patent was approved,
the land was not yet immerse in water. But due to the gradual
sinking of the land caused by natural calamities, the sea
permanently invaded the portion of subject land. Being one, it
should therefore be returned to the public domain.
17. Province of City of Zamboanga del Norte vs. City of
Zamboanga
18. Chavez vs. PEA
Facts: The government entered into a contract with Dev't Corp of
the Phil (CDCP) to reclaim certain foreshore and submerged areas
of Manila Bay. Later, the then President Marcos issued PD 1084
creating PEA which was tasked to reclaim and handle all kinds of
lands; also PD 1085 transferring to PEA the title of the reclaim
lands. Another reclaimed land was transferred to PEA by then
President Corazon Aquino and as a result, the titles of 3 reclaimed
islands known as "Freedom Islands" were issued to PEA. To
develop said islands, PEA entered into a Joint Venture Agreement
with AMARI, with an additional portion of land to be included in
the agreement.
These transactions were investigated when Sen. Maceda
denounced it in his speech as "grandmother of all scams". The
investigation concluded that: (1) the reclaimed lands PEA seeks to
transfer to AMARI under the JVA are lands of the public domain
which the government has not classified as alienable lands; (2) the
certificates of title covering the Freedom Islands are thus void,
and (3) the JVA itself is illegal.
Issue: W/N the JVA entered into PEA and AMARI is valid
Ruling: YES.
Under Sec. 2, Art. XII of the 1987 Constitution, the foreshore and
submerged areas of Manila Bay are part of the lands of the public
domain owned by the State which shall not be alienated unless
classified as agricultural lands. The mere reclamation of PEA does
not convert these inalienable lands of the State. There must be a
law or presidential proclamation classifying these reclaimed lands
as alienable.
In this case, PD 1085 and the issuance of special patent by Pres.
Aquino covering the Freedom Islands is equivalent to an official
proclamation classifying them as alienable public domain as it
constitute as declaration that they are no longer needed for
public use. Hence, the Freedom Islands are alienable lands of
public domain, open to disposition to qualified parties. However,
the JVA does not only concern the Freedom Islands, but also
another submerged areas of the Manila Bay. These areas are
inalienable until classified as no longer needed for public use.
Until then, PEA cannot dispose the same.
The fact that the alienable lands can be disposed, it is only
available for the qualified parties as stated. And under Sec. 3, Art.
XII of the Constitution, "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." Based on the foregoing, AMARI, being a
private corporation, the transfer of the Freedom Islands and the
submerged areas is void.
19. Villarico vs. Sarmiento
Facts: Villarico is an owner of a lot separated from the Ninoy
Aquino Avenue (highway) by a strip of land belonging to the
government. When the highway was elevated, stairways were
constructed on the strip land for the people to access the
highway. Buildings and establishments were then constructed on
the strip land owned by herein respondent. Petitioner likewise
acquired a portion of said strip land. He then filed a complaint for
accion publiciana against respondents claiming that the latter's
structures closed his right of way to the highway. Respondents
denied the allegations and argues that they were issued permit
for their constructions and that petitioner has no right over the
strip of land as it was a government property.
The trial court decided in favor of the respondents, which the CA
affirmed, ruling that petitioner has never been in possession of
any portion of the land and that he was not deprived of his right
of way as he could use an alternative passageway available
therein.
Issue: W/B petitioner was deprived of his right of way
Ruling: NO.
It is not disputed that the lot on which petitioner's alleged right of
way exists is of public dominion. Under Art. 420 of the CC,
property of public dominion are (1) those intended for public use
such as roads, canals, rivers, torrents, ports and bridges
constructed by the State, banks, shores, roadsteads, and other of
similar character; and (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.
As defined by the Court, public use is "use that is not confined to
privileged individuals, but is open to the indefinite public." Based
on the foregoing facts, the stairways to access the highway were
for the use of the people, thus, it is a property if public dominion.
Lastly, property of public dominion is outside the commerce of
man and hence cannot be burdened by any voluntary easement.
Therefore, petitioner cannot appropriate it for himself nor he can
claim any right of possession over it.
20. Heirs of Mario Malabanan vs. Republic
Facts: On 1998, Mario Malabanan applied for registration of a
land claiming that this property is an alienable and disposable
land of public domain and that he is entitled for it's title because
of his open, continuous, uninterrupted, public and occupation of
the land for more than 30 years. He presented a certification
issued by Community Environment and Natural Resources
(CENRO) proving that said land was alienable since 1982.
The RTC granted Malabanan's application under the operation of
Property Registration Law, but was reversed by the CA citing the
ruling in Republic v. Herbieto that under Sec. 14(1) of the Property
Registration Decree, any period of possession prior to
classification of the land as alienable and disposable should be
excluded from the computation of the period of possession.
When Malabanan died during the appeal, his heirs continued the
cause and asserted that the ruling in Republic vs. CA and Naguit
remains the controlling doctrine saying that any possession of
agricultural land prior to its declaration as alienable and
disposable could be counted in the reckoning of period of
possession for title under the Public Land Act and Property
Registration Decree. They also cited the ruling in Republic v.
T.A.N. Properties Inc. saying that the property had been
converted into private property through prescription.
Issue: Whether or not petitioners satisfied the requirements for
them to be granted of the subject property
Ruling: NO.
As a general rule, pursuant to the Regalian doctrine, all lands
belong to the State and are inalienable unless they are converted
into private ownership. As exceptions: (1) Agricultural lands
rendered as alienable may be disposed through any of the
exclusive modes under Sec. 11 of the Public Land Act. If the mode
is through judicial confirmation of imperfect or incomplete title
under Sec. 48 (b) of Public Land Act, the requirement is that the
subject agricultural land needs only to be classified as alienable
and disposable as of at the time of application, provided that the
applicant's possession of the land started since June 12, 1945 or
earlier. If these requirements are met, the public land is
converted into private ownership and the applicant automatically
becomes the owner of the land by virtue of imperfect or
incomplete title; (2) Public lands that are declared as no longer
needed for public use or development of national wealth are
converted into patrimonial lands or lands of private ownership, in
which the provisions of the Civil Code applies for the modes of
their acquisition. If the acquisition is through prescription, under
Art. 1311, proof of the land being converted into patrimonial land
prior to the period of acquisition is a sine qua non requisite.
In this case, the first exception applies. However, the petitioners
failed to present sufficient evident that they had been in
possession of the land since June 12, 1945. Hence, the land
cannot be considered as converted into private ownership even
there was a subsequent declaration of it as alienable and
disposable. Prescription never began to run against the State
because it remained ineligible for registration under Sec. 14(1) of
the Property Registration Decree, as well as under par. 2 of the
same provision unless the Congress enacts a law or the President
issues a proclamation declaring the land as no longer intended for
public service or development of national wealth.
21. Republic vs. Santos III
Facts: Respondent Arcadio Ivan filed for an application for land
registration of a property with his co-applicant, Arcadio Jr.,
alleging that that the property had been formed through
accretion to their adjoining property and had been in their joint
open, notorious, public, continuous and adverse possession for
more than 30 years. The City of Paranaque opposed the
application stating that it was an orchard that had dried up and
had not resulted from accretion.
Nevertheless, the RTC granted the application for land registration
despite appellee's failure to formally offer in evidence an official
certification that the subject land is alienable and disposable,
treating the land as an accretion that became respondents'
property pursuant to Art. 457 of the CC. The CA affirmed the
ruling of the RTC.
Issue:
1. W/N the subject land was an accretion of respondents'
property
2. W/N the respondents could claim the property by virtue of
acquisitive prescription pursuant to Sec. 14(1) of Property
Registration Decree
Ruling:
1. NO. The Court defined accretion as a process whereby the soil
is deposited along the banks of rivers. The deposited soil, to be an
accretion, must be: (a) gradual and imperceptible; (b) made
through the effects of the current of water; and (c) taking place on
land adjacent to the banks of rivers.
Here, the respondents did not suffice to prove the said
requirements. The evidence they have presented was that the
land was the dried-up river bed of the river, not that it was
formed through the current of the river. Thus, the property in
question cannot be treated as an accretion pursuant to Art. 457 of
the CC. In addition, Art. 502 of the same code expressly declare
that rivers and their natural beds are public dominion of the State
unless there is an express law that provides that the dried-up river
beds should belong to some other person.
2. No. Under Sec. 14(1) of the Property Registration Decree,
applicants for confirmation of imperfect title must prove that: (a)
the land forms part if the disposable and alienable agricultural
land of public domain; and (b) they have been in open,
continuous, exclusive and notorious possession and occupation of
the land under a bona fide claim of ownership since June 12, 1945
or earlier.
Here, the lower courts based their decision on the finding that the
respondents sufficed the supposed possession period of more
than 30 years from the fact that their predecessors in interest are
adjoining owners of the subject parcel land. Yet, nowhere in its
decision only stated the payment of taxes made by the
respondents, which did not established the claim of continuous,
open and public possession of respondents.
More so, even they have possessed the land over 30 years, they
cannot acquire the it by prescription without the proof that it was
an alienable and a disposable land of public dominion. Art. 420 of
the CC expressly stated that rivers are considered part of public
dominion, reiterated by Art. 502, as above-mentioned. The Court
cited its ruling in Celestial v. Cachopero, a case involving the
registration of a land found to be a dried-up part of a creek. The
Court held that under the above provisions of the CC, a creek is a
property of public dominion; it is outside the commerce of man
and not susceptible to private appropriation and acquisitive
prescription. And, subject to exceptions defined in Art. 461 and
absent any declaration by the government that a portion of the
creek has dried-up does not, by itself, alter its inalienable
character. Since the respondents have not been able to provide
proof of alienable character of the land, they could not validly
assert the acquisitive prescription of it.
22. Navy Officers' Village Association, Inc. (NOVAI) vs. Republic
Facts: The subject property of this case was a lot situated inside
the former Fort Andres Bonifacio Military Reservation (FBMR).
Proclamation No. 423 was issued by Pres. Garcia reserving parcels
of land, including the subject property, for military purposes.
Later, Proc. No. 461 was issued by Pres. Macapagal excluded the
subject property from the reserve and declared as disposable.
After, Pres. Macapagal issued Proc. No. 478 reserving again the
property for military purposes. Subsequently, the Republic sold
the property was NOVAI and the latter acquired its title.
Then, the Republic filed a complaint for cancellation of NOVAI's
title on the ground that the land is a part of a military reservation,
thus, a public property not susceptible for alienation. In its
answer, NOVAI argued that the land was no longer part of public
dominion as it was removed as military reserve pursuant to Proc.
No. 461.
The RTC ruled in affirmation of NOVAI. However, the CA reversed
said decision ruling that the property is inalienable land of public
domain pursuant latest issuance of Proc. No. 478, hence, cannot
be subject of sale.
Issue: W/N the property in question is a property of public
domain, thus, inalienable
Ruling: YES.
The Court decided in affirmation of CA's decision that the
property remains a part of public domain intended for public or
quasi-public use by virtue of Proc. No. 478. Undeniably, the
property formed part of the FBMR - a military reservation
belonging to public domain, at the time of the sale. Sec. 83 of
Public Land Act defines public domain lands classified as
reservations for public and quasi-public uses as "any tract or
tracts of land of public domain" which the Pres., by proclamation,
may designate these land when public interest requires it. Sec. 88
of the same act declared that these tracts of lands shall be non-
alienable and not susceptible for disposition until declared under
the Public Land Act or proclaimed by the Pres. Also, under the
pertinent provisions on Property under the Civil Code (Art. 419-
422), lands which are intended for public use of service such as
reservations for public or quasi-public uses are property of public
dominion and regarded as outside the commerce of man.
Here, NOVAI incorrectly cited Proc. No. 461 as the legal basis for
the property's sale in favor of them. Proc. 478, being the latest
issuance, is the controlling law which transferred back the
property to public or quasi-public use, which, consistent with Art.
420 of the CC, is a property of public dominion not patrimonial
property of the State.
23. City of Lau-Lapu vs. PEZA
Facts: PEZA was created by virtue of RA. 7916 or the Special
Economic Zone Act of 1995 granted the power to supervise the
enterprises located in the economic zones. PEZA oversees Bataan
Economic Zone and Mactan Economic Zone, which site was
reserved by Pres. Marcos under Proc. No. 1811. In a letter, City of
Lapu-Lapu demanded from PEZA the payment of real property tax
for PEZA's properties located in Mactan Economic Zone. However,
PEZA argued that it is an instrumentality of the national
government; hence, it is exempted from payment of real property
taxes under the Local Government Code. Also, under the Special
Economic Zone Act of 1996, it claimed that enjoys tax privileges.
The Province of Bataan likewise demanded real property tax from
PEZA. After PEZA was unable to pay, a notice of sale of real
property in public auction was sent by the Province. Reiterating its
stance, PEZA asserted real property tax exemption and that the
disputed properties are of public domain, thus, cannot be subject
to sale or other disposition.
Issue: W/N PEZA' properties are of public domain and therefore
exempted from real property tax
Ruling: YES.
Under Sec. 234(a) of the LGC, real properties owned by the
Republic of the Philippines are exempt from real property taxes.
Properties owned by the state are either of public dominion or
patrimonial property. Properties of public dominion, which are
enumerated in Art. 420 of the CC, are outside the commerce of
man and therefore exempted from any kind of disposition.
In this case, the properties sought to be taxed are located in
publicly owned economic zones of public dominion. The tax
properties which are located in Mactan Economic Zone, the
reserved site under Proc. No 1811 are considered as properties of
public domain set aside for public use and for specific purposer by
virtue of a presidential proclamation. Reserved lands are as well
inalienable and outside the commerce of man and remain as
property of the Republuc until withdrawb for public use either by
law or presidential proclamation. Since no such law or
proclamation withdrawing the site fron public use, it remains
reserved land. The same ruling goes for the claim of the Province
of Bataan, trying to convey the Bataan Economic Zone in a public
auction.
24. Republuc vs. Aboitiz
Facts: Aboitiz filed an application for land registration of a
property which he claimed, through witnesses, that he purchased
the same to one Irene Kapuno on 1994; that he had been in
actual, open, continuous, and exclusive possession of the property
since; that as per record of the DENR, it has been classified as
alienable and disposable since 1957; that per certification of the
Community Environment and Natural Resources (CENRO), it was
not covered by any subsisting land application; and that it had
been completely taxed since 1963 by his predecessor-in-interest.
The RTC granted the application. However, the CA reversed the
ruling stating that it was only from the date of the declaration of
such lands as alienable and disposable that the period for
counting the period of possession since June 12, 1945 or earlier
would commence. The land was declared alienable and
disposable in 1957, thus, it clearly did not meet the possession
requirement of Sec. 14(1) of Property Registration Decree or PD
1529 which must be since June 12, 1945 or earlier. Aboitiz then
presented the 31 years tax declaration converted the land, by way
of acquisitive prescription, to private property. Consequently, the
CA reversed its own ruling relying on Sec. 14(2) of the same
decree, affirming Aboitiz's argument of acquisitive prescription.
The Republic, citing Republic v. T.A.N. Properties Inc. argues that a
declaration that the property is alienable and disposable is not
sufficient to make it susceptible to acquisitive prescription. An
express government manifestation that it is already patrimonial or
no longer intended for public use or development of national
wealth pursuant to Art. 422 of the CC must also be shown. When
the property has become patrimonial, since then that the period
of acquisitive prescription can commence.
Issue: W/N Aboitiz acquired the land by acquisitive prescription
Ruling: NO.
Sec. 14(1) of PD 1529 in relation to Sec. 28(b) of Com. Act No. 141,
applicants for registration of land must prove that: (1) the subject
land forms part of the disposable and alienable lands of public
domain; (2) the applicant and his predecessors-in-interest have
been in open, continuous, exclusive and notorious possession and
occupation of it; and (3) it is under bona fide claim of ownership
since June 12, 1945 or earlier.
In this case, for the first requirement, Aboitiz only presented a
CENRO certification to prove the alienable character of the land.
In Republic v. Hanover Worldwide Trading Corp., the Court
declared that CENRO is not the official legal custodian of the
issuances of the DENR Sec. declaring the alienability and
disposability of public lands. With regard to the third requisite,
unfortunately, the records shows that the earliest Aboitiz and his
predecessor-in-interest possessed and occupied the land was inly
in 1963, 18 years late to satisfy the third requisite.
As Aboitiz did not meet Sec. 14(1) of PD 1529 requirements, he
asserted that he satisfied the 30 years possession requirement
under Sec. 14(2) to acquire land title via acquisitive prescription.
However, the Court decided citing Heirs of Mario Malabanan v.
Republic, containing the same ruling of Republic v. T.A.N.
Properties Inc., which the Republic correctly cited in its petition.
Failure to prove and satisfy the foregoing requirements, Aboitiz is
not entitled to the registration of the subject land.
25. Alolino vs. Flores
Facts: Alolino is an owner parcel of land where he constructed a
two-storey house. Later, respondent spouses constructed their
house/sari-sari store on a vacant barrio road without building
permit, only 2-3 inches away from the back of Alolino's house.
Consequently, Alolino filed a complaint against the spouses after
refusing to remove the construction despite demands, claiming
that he was being deprived of his right of easement of light and
view, right of way to the barrio road, and obstructed the air
ventilation inside his house. The spouses counter-argued that it
was Alolino's fault that he constructed his house without
observing allowance to his lot and. The spouses also admitted that
they did not secure a building permit because, they claimed, that
the Sanggunian of Taguig reclassified the property as a residential
lot.
The RTC decided in favor of Alolino after an ocular inspection was
made. However, the CA reversed the decision and concluded that
the government already abandoned the barrio road pursuant to
the 2004 Sangguinian resolution and that Alolino did not acquire
right of easement of light and view.
Issue: W/N the construction of house/sari-ari store of the
respondent spouses in the barrio road is proper
Ruling: NO.
The Court held that the properties of LGUs are classified as either
property for public use or patrimonial property. Art. 424 of the CC
distinguishes the two: "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 the is patrimonial." In this case, the barrio road adjacent to
Alolino's house is property of public dominion devoted to public
use.
The Court found no merit in respondent’s contention that the
barrio road was reclassified by the Taguig LGU. The LGC requires
LGUs to enact an ordinance approved by 2/3 of the Sanggunian
members to convert the barrio road into patrimonial property.
Here, the Sangguinian did not enact an ordinance but merely
passed a resolution. Properties of the local government that are
devoted for public use are deemed public and under the absolute
control of the Congress.
As a barrio road, existing for public use, it is outside the
commerce of man and as a consequence: (1) it is not alienable or
disposable; (2) it is not subject to registration under PD 1529 and
cannot be subject of Torrens Title; (3) it is not susceptible to
prescription; (4) it cannot be leased, sold or otherwise be object
of a contract; (5) it is not subject to attachment and execution;
and (6) it cannot be burdened by any voluntary easements. It is
designated for the use of general public who are entitled to free
and unobstructed passage thereon. Permanent obstructions on
these roads, such as respondents' illegally constructed house, are
injurious to public welfare and convenience which constitutes as
nuisance.
The Court reversed the decision of the CA and ordered the
demolition of respondents' house.
26. Bicerra vs. Teneza
Facts: Complainant alleges that their house built on a lot owned
by them was forcibly demolished by the appellees, claiming to be
the owners of the lot. The plaintiff prayed for damages caused by
the dismantling of the house.
Issue: Whether the action involves real property, as per appellant
contend, and therefore cognizable by the CFI or whether it
pertains to the jurisdiction of the Justice of Peace Court since
there is no real property litigated, the house having ceased to
exist
Ruling: A house is classified as an immovable property by reason
of its adherence to the soil on which it is built, pursuant to Art.
415 of the CC. The classification holds true regardless of the fact
that the house may be situated on land belonging to a different
owner. But once the house is demolished, as in this case, it ceases
to exist as well as its character as an immovable property.
27. Tumalad vs. Vicencio
Facts: Defendant-appellants executed a chattel mortgage over
their house built on a rented lot in favor of plaintiffs-appellees
with terms and conditions to guarantee a loan. When the
defendant-appellants defaulted in paying, the mortgage was
extrajudicially foreclosed and the house was acquired by the
plaintiffs-appellees through public auction. Defendants-appellants
impugned the legality of chattel mortgage when ordered to
vacate sa property, claiming that they are still the owner of the
house because the chattel mortgage was void ab initio on the
ground that the house is an immovable, and can only be subject
of real and not chattel mortgage.
Issue: W/N the chattel mortgage was void ab initio defendants-
appellants are still the owner of the house
Ruling: The chattel mortgage was valid, thus, the sale of the house
was also valid.
The Court cited the ruling in Lopez v. Orosa Jr stating that the
inclusion of the building, separate and distinct from the land, in
the enumeration of what may constitute real properties under
Art. 415 of the CC means that a building by itself is an immovable
property irrespective of whether or not said structure and the
land in which it is adhered to belong to the same owner.
However, there can be exceptions. In the case of Manarang and
Manarang v. Ofilada, the Court stated that the parties to a
contract may, by agreement, treat as personal property that
which by nature would be real property. It may be done by way of
mortgage indicating a real property by nature as personal
property.
Here, the defendants-appellants expressly designated the house
as Chattel Mortgage. They did not expressly referred to the
subject as personal property, yet by conveying it by way of chattel
mortgage; they impliedly treated it as chattel. Moreover, the
defendants-appellants themselves questioned the validity of the
mortgage even they are the ones who executed it. Therefore, the
doctrine of estoppel applies to herein defendants-appellants and
they are estopped from attacking the validity of the mortgage
having treated the subject house as personalty.
28. Board of Assessment Appeals vs. Meralco
Facts: Meralco was became the owner of the franchise granted by
an Ordinance to operate an electric railway and electric light, heat
and power system in Manila. The electric power is generated by
hydro-electric plant in Laguna and is transmitted to Manila
through electric transmission wired attached to steel towers.
These towers were assessed for real property tax by the
petitioner City Assessor of Quezon City. Meralco paid the tax
under protest and appealed to the CTA. The CTA favored Meralco
holding that the steel towers come within the term "poles" which
declared exempt from taxed under petitioner’s franchise and that
these towers are personal properties and not subject real
property tax, hence, Meralco is entitled for tax refund.
Issue: W/N these steel towers are considered immovables
Ruling: NO.
The Court stated that the term "pole", as used un Act No. 484,
refers to an upright standard to the top of which something is
affixed or by which something is supported, and included a steel
tower of an electric power company, like Meralco. In addition, it
should be conceded that steel towers, as that those questioned,
can better effectuate the purpose of which the Meralco's
franchise was granted.
Moreover, as to the question of the steel towers' character, Art.
415 of the CC enumerated those regarded as immovable
property. The steel towers in question, however, do not fall within
any of those contemplated therein. It does not constitute as
buildings or constructions adhered to the soil under par. 1, as they
are removable and merely attached to it. Neither they are under
par. 3, as they are not attached to an immovable in a fixed
manner because they can be separated without breaking the
object to which they are attached. Lastly, it does not also fall
under par. 5, for they are not machineries intended for industry or
works on land because Meralco is not engaged in an industry or
works on land in which the towers are constructed. Therefore, the
subject properties, not being real property, are not subject to real
property tax. Thus, Meralco is entitled for tax refund.
29. Benguet Corp vs. Centrak Board of Assessment Appeals
Facts: Petitioner's tailings dam and the land thereunder were
assessed as taxable improvements by Provincial Assessor of
Zambalez. Petitioner insists that the tailings dam is not within the
meaning of "assessable improvement" under the Real Property
Tax Code as it is an integral part and has no value separate from
the mine. Petitioner added that the tailings dam is also used as a
pollution control device for which it must be commended rather
than penalized with realty tax. On the other hand, the Solicitor
General argues that the dam is an improvement because its
function enhances the value and utility of the mine.
Issue: W/N the tailings dam is an assessable improvement on the
mine
Ruling: YES.
The definition of improvement under the Real Property Tax Code
can be interpreted as "artificial alterations of the physical
condition of the ground that are reasonable permanent in
character." Here, even without the tailings dam, petitioner's
mining operation can still be carried out because the primary
function of the dam is to merely receive and retain water coming
from the mine. There is no allegation that the water coming from
the dam is the sole source of water so as to make it an integral
part of the mine.
As to petitioner's assertion that the dam will serve the local
community as irrigation facility implying that it can then exist
separately, the Court stated that whether a structure constitutes
an improvement so as to partake the status of realty would
depend upon the degree of permanence intended its construction
and use. It is sufficient that the improvement is intended to
remain as long as the land to which it is annexed is still used for its
purpose. Therefore, the Court held that the dam falls within the
definition of 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 Art. 415 of the CC, as it is a construction
adhered to the soil which cannot be detached without causing the
destruction of the soil, makes it taxable under Sec. 38 of the Real
Property Tax Code.
30. Soriano vs. Sps. Galit
Facts: Respondents contracted a loan from petitioner Soriano
secured by a real estate mortgage over a parcel of land. After he
defaulted, Soriano filed for collection of sum of money. The RTC
favored Soriano and issued a writ of execution levied on
Respondent's real properties, namely: (1) a lot, (2) store/house
and (3) bodega both constructed on said lot. Petitioner acquired
the properties mention through the public auction. The certificate
of sale over the store/house and the bodega was registered in
favor of petitioner and a writ of possession was granted by the
court. However, respondents assailed the inclusion of the parcel
of land which was not sold on execution among the list of real
properties in the writ of possession. The CA granted respondent's
petition and declared the writ of possession null and void.
Issue: Whether the land on which the buildings levied upon in
execution is necessarily included
Ruling: NO.
Art. 415 of the CC enumerate land and buildings as real properties
separately. The Court stated that it only mean that the building is,
by itself, considered immovable. Thus, it has been held that -
while it is true that the mortgage of land necessarily includes, in
the absence of stipulation, buildings by itself may be mortgaged
apart from the land which it has been built. Such mortgage would
still be a real estate mortgage for the building would still be
immovable even treated apart drom the land.
In this case, considering that only with repect of the sold
store/house and bodega constructed on the lot was covered by
the title of execution, whuch by themselves are real properties,
the same would be regarded as separate fron the conveyance of
the lot which they are built on.
31. FELS Engergy Inc. vs. The Province of Batangas
Facts: NAPOCOR entered into a lease contract with Polar Energy
Inc. over diesel engine power barges stipulating that the former
will shoulder the obligation of paying all real estate taxes. Polar
Energy Inc. assigned its rights to FELS. When FELS received an
assessment of real property tax over the power barges from the
Province of Batangas, it reminded NPC of its obligation for the
said tax. NPC then filed a petition with the Local Board of
Assessment Appeals (LBAA) and assert that the power barges are
not real property subject to real property tax pursuant to a DOF
opinion. LBAA, however, denied the petition ruling that the power
plant facilities are real properties for taxation puposes because
they are installed at a specific location with permanency
character; and that FELSS is the one being taxed, not NPC.
On the other hand, Central Board of Assessment Appeals (CBAA)
found the power barges exempt from tax on the ground that FELS
and NPC are actually, directly and exclusively using the power
barges, they are covered by exemption under Sec. 234 (c) of RA
7160. Later, CBAA reversed this decision and denied the petition,
which the CA affirmed.
Issue: W/N the power barges are real property
Ruling: YES.
The Court affirms with LBA A and CBAA declaring that the power
barges are real property and thus subject to real property tax,
citing the case of Consolidated Edison Company of New York Inc.
et al v. The City of New York et al. Moreover, Art. 415 of the CC
provides that "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" are considered immovable property. Thus,
power barges are categorized as immovable property by
destination, being in the nature of machinery intended by the
owner of the industry or work which may carried on in a building
or on a piece of land and which tend directly to meet the needs of
said industry or work.
As regards to the tax exemption claim under Sec. 234(c) of RA
7160 which provides that machineries to be exempted from tax
must be actually, directly and exclusively used by the government,
FELS cannot invoke the same. The stipulation that NPC will
shoulder the taxes does not justify the exemption of FELS from
payment because the privilege of exemption of NPC under the
above-stated provisuon does not extend to FELS. The agreement
between the two does not bind a 3rd person not privy to thereto,
in this case, the Province of Batangas. Hence, the Court held that
FELS is liable for the real property tax over the power barges.
32. Provincial Assessor of Agusa del Sur (Provincial Assessor) vs.
Filipinas Palm Oil Plantation (Filipinas)
Facts: Filipinas entered into a lease contract with NDC-Guthrie
Plantations Inc-NDCGutherie Estates Inc. (NGPI-NGEI) over the lot
of its plantation. When the Provincial Assessor assessed Filipinas'
properties found in the plantation, Filipinas assailed that real
property taxes should not be imposed upon the roads as they
belong to the NGPIEI and the unmovable haulers and other
equipments which are movable in nature. The LBAA ruled that the
roads are not taxable as they were used by the public, as well as
the road equipment and mini haulers, for they are movables vital
to Filipinas' business. This was affirmed by CBAA. The CA cited
Davao Saw Mill Co v. Castillo where it has been held that
machinery that is movable by nature becomes immobilized only
when the placed by the owner of the tenement but not when
another person having temporary right unless this person acts as
agent of the owner. Thus, the mini haulers and road equipments
retain their nature as movables.
Issue: Whether Filipinas' road equipment and mini haulers are
movable properties and have not been immobilized by
destination for real property taxation
Ruling: NO.
The Court ruled that the road equipment and mini haulers shall be
considered as real property and thus subject to real property tax.
Sec. 199(o) and 232 of the LGC give an extensive definition of
what constitutes "machinery"and unequivocally subjects such
machinery to real property tax which "may or may not be
attached, permanently or temporarily, to real property". Those
which are mobile or are not permanently attached must (a) be
actually, directly and exclusively used to meet the needs of the
industry; and (b) by their very nature or purpose, be designated
for or necessary for manufacturing, mining, logging, commercial
or industrial purposes. On the other hand, Art. 415 (5) of the CC
considers as immovable property by destination, which
mentioned but did not define machinery, are "those essentially
movables, but by the purpose of which they have been placed in
an immovable, partake the nature of the latter because of the
added utility derived therefrom. Consequently, between the two,
using the principle of statutory construction of lex spwcialis
derogant generali, the special provision prevails over the general
one.
Therefore, in determining if the machineries are real property or
not, the definition and requirements under the LGC are
controlling. Hence, petitioner is correct in claiming that the phrase
from Sec. 199(o) pertaining to physical facilities for production us
comprehensive enough to include the road equipment and mini
haulers as actually, directly and exclusively used by respondent to
meet the needs of its operations, thus making it exempt from real
property tax.
33. REPEATED (Chavez vs. PEA [18])
34. On Consideration: Chavez vs. PEA
35. Usero vs. CA
Facts: Sps Polinar are owners of a land located behind the lots of
petitioners Samela and Usero. Between the lots is a low-level strip
of land with stagnant body of water filled with water lilies. Sps
Polinar constructed a concrete wall on the bank of the strip of
land and rip-rapped the soil to prevent strong current passing
through and damage their house everytime a storm occurs. For
this reason, Samela and Usero, claiming ownership over the strip
of land demanded Sps Poliner to stop the construction. On
separate complaints of the petitioners, Sps. Polinar presented in
evidence a picture showing that their property is situated at the
edge of a creek which is the subject strip of land filled with water
lilies, therefore, cannot be owned by the petitioners for it is a
property of public dominion. In the decision of the RTC, it
confirmed the existence of said creek and ruled that Sps. Polinar
may maintain the construction to prevent erosion to their
property. The CA affirmed the RTC stating that the fact that water
lilies are found in that strip of land can only mean that there is a
permanent stream of water there.
Issue: W/N the disputed strip of land is a private property of
petitioners or part of the creek and therefore part of the public
domain
Ruling: The strip of land is in fact a creek and owned by the State.
The Court aided with the CA's findings and ruled the existence of
the creek which is a property of public dominion. Art. 420 of the
CC provides that "those intended for public use, such as roads,
canals, rivers, torrents, ports and bridges constructed by the
State, banks, shores, roadsteads and other similar character" are
property of public dominion. The phrase "other similar character"
includes a creek. It being a property of the State makes it not
susceptible of private ownership.
36. Manila International Airport Authority (MIAA) vs. CA
Facts: MIAA was created to operate and administer NAIA
Complex. MIAA Charter (EO 903) transferred to MIAA the land
constituting the Airport. With the Office of the Government
Corporate Counsel's (OGCC) opinion that MIAA that the LGC
withdrew the latter's exemption from real property tax granted by
the MIAA Charter, it was subjected and actually paid real property
tax due. City of Paranaque levied tax over the airport lands and
buildings, and when MIAA failed to pay the tax delinquency, sold
the land in a public auction. MIAA, on the other hand, argued that
the title of the land belongs to it but it cannot claim ownership
over the airport lands since its real owner is the State devoted for
public use. MIAA added that the airport lands and buildings are
exempt from real property tax under its Charter, as well as under
Sec. 234 of the LGC because it is owned by the Republic. It
invoked the principle that the government cannot tax itself;
hence, it is not subject to real property tax.
Issue: W/N the Airport Lands and Building are owned by the State
and thus MIAA is exempt from real property tax
Ruling: YES.
Art. 420 of the CC provided that properties like "roads, canals,
rivers, torrents, ports and bridges constructed by the State," are
of public dominion. The MIAA Airport Lands and Buildings
constitute as "port" constructed by the State and thus owned by
it. The fact that MIAA collects terminal fees and other charges
from the public does not remove the character of the Airport
Lands and Buildings as properties for public use. Unless the
President issues a proclamation withdrawing these properties
from public use, they will remain as of public dominion and are
inalienable.
37. REPEATED (Macasiano vs. Diokno [15])
38. Cebu vs. Bercilles
Facts: The subject property was declared an abandoned road
through a resolution, it being not included in the City
Development Plan, of a terminal portion of M. Borces Street,
Mabolo, Cebu and sold by the City Mayor through public bidding.
The herein petitioner, as the highest bidder, sought to register the
said lot. The Assistant Provincial Fiscal, however, filed a motion to
dismiss application for registration on the ground that the
property sought being a public road intended for public use is of
public domain therefore outside the commerce of man.
Issue: W/N the withdrawal of the property in question from public
use and its subsequent sale to the petitioner is valid
Ruling: YES, both the withdrawal and the sale are valid.
The Revised Chartered of Cebu vested the city the power to close
a city street. In the case of Favis v. City of Baguio, where the
power of the city council to close city streets and to withdraw the
same from public use was similarly assailed to the court and
stated that this power is discretionary so long as it does not
damage private interests.
Art. 422 of the CC stated that "property of public dominion, when
no longer intended for public use or public servuce, shall form
part if the patrimonial property of the State." Here, since the
property was withdrawn from public use, it bacame a patrimonial
property which can be the object of an ordinary contract. Hence,
the petitioner is entitled to the registration of the sold lot.
39. Salas vs. Jarencio
Facts: Portion of the Cadastral Survey of the City of Manila was
sold and registered in favor of one Pura Villanueva. Later, RA No.
4118 was passed converting the cadastral survey of City of Manila,
a reserved communal property, into alienable and disposable
patrimonial land of the State under the disposal of Land Tenure
Administration (now Land Authority). With the implementation of
RA 4118, the previous registration of sale made by the City of
Manila was cancelled and was transferred in the name of Land
Authority. Consequently, the City Mayor of Manila filed an action
for the prohibition of further implementing the above law on the
ground that it is unconstitutional as it deprived the City of Manila
its property without due process of law and payment of just
compensation.
Issue: Whether the property involves is a private or patrimonial
property of City of Manila
Ruling: The property is a patrimonial property of the City of
Manila.
The City of Manila as well as its predecessor, the Ayuntamiento de
Manila, could validly acquire property in its corporate or private
capacity because of the dual character - private or public - of a
municipal corporation. In acquiring of land, it may do so under
any modes for acquiring ownership and real rights under the law.
In the absence of a title deed to any land claimed by the City of
Manila as its own, showing that it was acquired with its private or
corporate funds, the presumption is that such land came from the
State upon the creation of the municipality. (Unson v. Lacson et
al) The municipalities of the Philippines were not entitled, as a
matter of right, to any part of the public domain for use of
communal lands. The Spanish law provided that the usufruct of a
portion of the public domain adjoining municipal territory might
be granted by the government for communal purposes, upon
proper petition, until granted, no rights therein passed to
municipalities and that the title remains in the sovereign. (City of
Manila v. Insular Government)
The act of classifying State property calls for the exercise of
discretionary legislative power. And the passing of RA 4118
merely confirmed the character of the property in possession of
the City of Manila as communal land of the State and made it
available for disposition by the national government. Hence, City
of Manila was not deprived of anything it owns, either under the
due process clause or eminent domain provisions of the
Constitution.
40. Berkenkotter vs. Cu Unjieng e Hijos
Facts: Mabalacat Sugar Co. Inc obtained a loan from Cu Unjieng
secured by a first mortgage of 2 parcels of land with all the
properties existing therein or that may in the future exist thereon.
After, B. A. Green, president of Mabalacat Sugar Co. Inc.
purchased additional machinery and equipment to increase
production using an advance from the petitioner Berkenkotter,
promising to reimburse him as soon as he could obtain the
additional loan. Then, Mabalacat Sugar Co. Inc., to obtain another
loan from Cu Unjieng, offered as security the additional machinery
and equipments and installed in the sugar central, but failed, for
the reason that the additional machinery and equipments are
regarded as improvement and are included as security to the first
loan.
Issue: W/N the additional machinery and equipments are
regarded as improvement incorporated with the central subject to
the mortgage executed in favor of CU Unjieng e Hijos
Ruling: YES, the additional machinery and equipments are
improvements.
The installation of a machinery and equipment in a mortgaged
sugar central, in lieu of another of less capacity for the purpose of
carrying out the industrial functions of the latter and increasing
production, constitutes a permanent improvement on said sugar
central and subjects said machinery and equipment to the
mortgage constituted thereon.
Art. 334 (5) of the CC gives the character of real property to
"machinery, liquid containers, instruments or implements
intended by the owner of any building or land for use in
connection with any industry or trade being carried on therein
and which are expressly adapted to meet the requirements of
such trade or industry."
The fact that B.A. Green who purchased the new machinery and
equipment has bound himself to Cu Unjieng supplying him the
purchase money to hold them as security for the payment of
latter's credit, and to refrain from mortgaging or otherwise
encumbering them does not alter the permanent character of the
incorporation of said machinery and equipment.
41. Philippine Refining Co. Inc. (PRCI) vs. Jarque
Facts: PRCI and Jarque executed 3 mortgages on motor vessels
and each was denominated as "chattel mortgage." First and
second mortgage has no appended affidavit of good faith, while
the third contained such but not registered in the customs house.
When Jarque was declared insolvent, the assignment of all his
properties was executed. The Judge did not order the foreclosure
of mortgages, but sustained the fatal defectiveness of the
mortgages.
Issue: W/N the chattel mortgages over the vessels are defective
Ruling: YES.
Vessels are considered personal property under the Civil law. (Art.
585, Code of Commerce) The only difference between a chattel
mortgage of a vessel and of other personalty is that it is not now
necessary for the former to be noted in the registry if the register
of deeds, but it is required that the records of documents
affecting the title to a vessel be recorded in the Collector of
Customs at the port of entry. Otherwise, it is generally like other
chattel mortgages as to its requisites and validity. They are
subject to mortgage under the provisions of Chattel Mortgage
Law. Under its Sec. 5, the requirement of an affidavit of good faith
appended to the mortgage and recorded therewith shall deem
sufficient to constitute a good chattel mortgage. Otherwise, the
lack of an affidavit of good faith in a chattel motgage of a vessel is
unenforceable against third persons.
42. Davao Saw Mill vs. Castillo
Facts: Davao Saw Mill's business operates on a leased land where
it only constructed a building therein and housed the machinery
used by it which were mounted and placed on cement
foundations. Davao Saw Mill, on number of occassions, executed
chattel mortgage over the machinery. These machineries are now
being questioned as to what nature or characterization are they.
Issue: Whether the machineries are real or personal property
Ruling: The machinery is personal property.
A lessee placed machinery in a building erected on a land
belonging to another, with the understanding that the machinery
was not included in the improvements which would pass to the
lessor on the expiration or abandonment of the land leased. Here,
it must also be pointed out that appellant's characterization of the
machinery as chattels is indicative of intention upon the property
as the character determined by the parties. Lastly, pursuant to
Art. 334 (5) of the CC, a machinery which is movable in its nature
only becomes immobilized by destination when placed in a plant
by the owner of the property or plant, but not when placed by a
temporary occupant, unless such person is an agent of the owner.
43. Prudential Bank vs. Panis
Facts: Plaintiff Sps. Magcale obtained a loan from petitioner Bank
secured by a real estate mortgage over a land conveyed by
mortgage with right of occupancy and a residential building
constructed thereon. Later, the Sec. of Agriculture issued a
Miscellaneous Sales Patent over the parcel of land which was the
subject of the real estate mortgage, possessory rights, in favor of
the spouses. Subsequently, an additional loan was obtained by
the Sps. from the petitioner Bank secured also by a real estate
mortgage over the same properties previously mortgaged.
When spouses failed to pay, the real estate mortgage was
extrajudicially foreclosed and sold to defendant bank in a public
auction, despite written notice of the spouses to desist from the
bidding.
Respondent Court declared the real estate mortgages as null and
void on the ground of the supervening issuance of the patent in
favor of the spouses.
Issue: W/N a valid real estate mortgage can be constituted on the
building erected in the land belonging to another
Ruling: YES.
In the enumeration on properties under Art. 415 of the CC, the
Court ruled in Lopez v. Orosa Jr. et. al., "it is obvious that the
inclusion of building separate and distinct from the land, in said
provision of law can only mean that a building by itself is an
immovable property." Thus, while a mortgage of land necessarily
includes buildings in the absence of stipulation, still a building by
itself may be mortgaged as realty apart from the land on which it
has been built.
Here, the first mortgage was executed prior to the issuance of the
patent and before the government was vested of its title. Hence,
the mortgage executed by the spouses on their own building
which was erected on the land belonging to the government is a
valid mortgage.
On the other hand, this is not the case for the second mortgage
which was executed after the issuance of the patent which falls
under the prohibition of the pertinent provisions of the Public
Land Act and RA 730, for it already covered the land belonging to
the government, therefore, null and void.
44. Caltex vs. CBAA
Facts: Caltex loaned the subject machines and equipment to gas
station operators under an appropriate lease agreement and
retains the ownership of the machines and equipment securing
the term of the lease. These items are regarded by the city
assessor as taxable realty. However, the City Board of Tax Appeals
ruled that they are realty. On the other hand, the CBAA ruled that
the machines and equipments are real property within the
meaning of Secs. 3(k) & (m) and 38of the Real Property Tax Code
and PD 464, not the definitions of real property under Art. 415
and 416 of the CC. Caltex claim otherwise, invoking that
machinery, which is movable by nature becomes immobilized by
destination when laced by the owner of the property but nit so
when placed by a person having temporary right, unless such
person acted as agent of the owner.
Issue: W/N these gas station machines and equipments are real
property
Ruling: YES.
The Court held that the said machines and equipments, as
appurtenances to the gas station building owned by Caltex 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 or
site or embedded therein, are taxable improvements and
machinery within the meaning if 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. In
Standard Oil Co of New York v. Jaramillo, the Court stated that 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.
45. REPEATED (Tumalad vs. Vicencio [27])
46. US vs. Tambunting
Facts: Accused and his wife were occupants of the upper floor of
house where Manila Gas Corporation previously installed
apparatus for the delivery of gas for both upper and lower floors.
Upon inspection after the gas pipe was disconnected, thus cutting
the gas supply, it was found that the gas was being used by the
accused without the knowledge of the company by inserting a
short pipe in gap where the former gas meter was placed, and
used it for cooking for about 2 or 3 months. The accused admitted
the use of the gas and found guilty beyond reasonable doubt for
the crime of theft.
Issue: W/N the gas can be a subject of theft
Ruling: YES.
The clandestine use of gas by the accused, without the consent of
the owner, at animo lucrandi, constitutes theft.
In US v. Genato, a case which involved the theft of electric energy,
the Court ruled, in accordance with the analogy of the case
involving the theft of gas, that electric energy could also be the
subject of theft. Likewise, in US v. Carlos, it was stated that the
Spanish, English and American courts affirmed that taking of gas
may constitute theft/larceny.
47. Associated Insurance & Surety Co. Inc. (AISCI) vs. Isabela Iya
Facts: Spouses Valino, to purchase on credit rice from NARIC, filed
a bond secured by their executed chattel mortgage over their
house, counter-guaranteed by AISCI. The lot on which the house is
built was still in the name of the Philippine Realty Corp. at the
time of the chattel mortgage execution, but subsequently
transferred to the spouses' name. Later, spouses executed a real
estate mortgage over the said lot in favor of Iya, to secure
payment of indebtedness.
When the spouses defaulted in their obligation to NARIC, the
chattel mortgage over the house was foreclosed and sold to the
latter in a public auction. When AISCI learned about the real
estate mortgage, it filed a complaint praying for the exclusion of
the house to recognize their right over it. Iya also filed an action
alleging that she acquired real rights over the house and that the
chattel mortgage over it was null and void because it is a real
property, not a personal property. In its answer, AISCI asserted
that when the chattel mortgage was executed, the lot on which
the house was built did not belong yet to the spouses, hence, the
house was then a personal property so the chattel mortgage is
valid.
Issue: W/N the house is a personal property, thus the chattel
mortgage is valid
Ruling: No, the house is a real property, therefore the chattel
mortgage is invalid.
The Court ruled that under Art. 415 of the CC, land and building
are expressly enumerated as real property, means that the
building itself is an immovable separate from that of the land.
Moreover, in Lopez v. Orosa Jr., it was held that building is an
immovable whether or not the land on which it was erected
belong to the same owner.
Here, as personal properties could only be the subject of chattel
mortgage pursuant to Act 3952, and obviously the disputed house
is not one, the execution of the chattel mortgage covering the
said building is null and void. Therefore, the claim of AISCI that it
acquired ownership over it by virtue of the auction sale is also
without effect.
48. MERALCO vs. CBAA
Facts: CBAA assessed and required the two oils storage tanks of
MERALCO for the imposition of realty tax. Meralco claimed that
the tanks are not realty for they merely sits to its foundation by
bolts, screws or similar devices; nor anchored or wielded on to a
concrete wall. CBAA concluded that the foundation itself of the
tanks and the walls, dikes and steps, which are integral part of the
tanks, are affixed to the land. Meralco contended that the tanks
are not within the real property enumerated in Art. 415 of the CC
and therefore, cannot be categorized as realty by nature, by
incorporation, by destination nor by analogy; and that these are
attached to a leased land, not owned by Meralco.
Issue: W/N the oil tanks are real property
Ruling: YES.
The Court held that while the oil tanks are not attached to the
land, they may, nevertheless, considered as improvements on the
land pursuant to the definition under Sec. 38 (k) of the Real
Property Tax Code, enhancing its utility and rendering it useful to
the oil industry. These two tanks are undeniably installed with the
degree of permanence as receptacles for oil needed by Meralco
for its operations.
In addition, in Standard Oil Co. of New Jersey v. Atlantic City, oil
tanks were held to be taxable realty. And in Standard Oil Co. of
New York v. Jaramillo, the Court stated that things classified as
personal property can be considered as real property for the
purposes of taxation.
49. La Bugal-B’laan Tribal Association vs. Raos
50. Tan Toco vs. Municipal Council of Iloilo
Facts: Tan Toco sued the Municipal Council of Iloilo for the
payment of her land appropriated for street widening. For lack of
funds, the property of the municipality composed of two auto
trucks, one police auto mobile, police stations and public markets
are attached and subjected for sale. However, the CFI declared
the attachment null and void upon the fiscal's motion, ruling that
it is violative of the municipality's right and these properties are
exempt from execution.
Issue: W/N the properties attached are exempt from execution
Ruling: YES.
Under Sec. 2156 of the Administrative Code, municipalities are
political and corporate bodies that have the power to acquire real
and personal property for municipal purposes under its corporate
name. It does not specify what kind of property the municipality
can acquire. However, Art. 343 of the CC divides the properties of
provinces or municipalities for patrimonial and public use. Art.
344 provides that provincial roads and foot-path, squares, streets,
fountains and public waters, drivers and public improvements of
general benefit built at the expense od said province or
municipality, are property for public use. All other property not
mentioned is patrimonial subject to the provisions of CC except as
provided by special laws.
The Court ruled that the principle governing property of public
domain of the State is applicable to that of municipalities as said
municipal property is similar in character. Hence, if the State's
property of public domain is inalienable and is outside the
commerce of man, the same applies to that of the municipalities.
Therefore, in this case, the properties of the municipality of Iloilo
are hereby exempted from execution.
51. Municipality of San Miguel, Bulacan vs. Hon. Fernandez
Facts: One of the orders in a judgment was rendered against
petitioner Municipality of San Miguel was pay the plaintiff a sum
of money corresponding to the rentals of the disputed 5 lots and
its restoration of ownership in favor of the plaintiffs in said case. A
writ of execution was rendered by the respondent judge, in which
petitioner sought to quash on the ground that the municipality's
property or funds are all public funds exempt from execution.
Issue: W/N the funds of the Municipality of San Miguel are public
funds exempt from execution
Ruling: YES.
It is well-settled rule that public funds are not subject to levy and
execution. The Court cited the ruling in Tantoco v. Municipal City
of Iloilo, declaring that municipal corporations' public property,
taxes and public revenues cannot be seized under execution
against them. Judgments rendered taxes, and the proceeds of
such judgments are not subject to execution unless the law so
declares.
Therefore, all the funds of petitioner municipality in possession of
municipal and provincial treasury are public funds and as such,
they are exempt from execution.
52. Government of the Philippine Islands vs. Cabañgis et. al.
Facts: A judgment adjudication the title of the cadastral survey of
the City of Manila. Petitioner appealed from this judgment
alleging that: (a) the subject lots are property of public dominion
acquired from Manila Bay by accession; (b) the big part of the lots
are owned by spouses Cabangis acquired by prescription; and (c)
the lots have already existed before, but because of current and
big waves, the were submerged in water. Claimants-appellee
contended that when the large parcel, their predecessor-in-
interest immediately took possession of as soon as they were
reclaimed, therefore it belongs to them. On the other hand, the
government claimed that this land belonging to Cabangis
predecessor-in-interest became part of public domain when
reclaimed as a result of government works, when it was
submerged in water due to the gradual erosion caused by ebb and
flow of tide.
Issue: W/N the lots in question having been claimed from the sea
as a result of government work, belong to the public domain
Ruling: YES.
Evidence showed that the waves of Manila Bay have been
gradually washing away the sand that formed the subject lots
until the water submerged them, and thereafter reclaimed from
the sea by the government by filling it with sand and silt extracted
from the bed of Vitas Estuary when the government dredged said
estuary in order to facilitate navigation. Neither the herein
claimants-appellees nor their predecessor-in-interest did anything
to prevent their destruction.
Therefore, the Court held, pursuant to the case of Aragon v.
Insular Government, that the lots in question which disappeared
because of the gradual erosion due to the ebb and flow of tide,
and remained in such condition until reclaimed by the filling done
by the government, belong to the public domain for public use.