Page 1 of 1
B A S I C P R I N C I P L E S : LAW ON PROPERTY
PROPERTY, concept of: (Civil law concept) – All things whether
tangible [physical objects] or intangible [rights] which are or may
be the object of appropriation. (See Art. 414 NCC).
It follows that those which cannot be appropriated are not
considered property. [i.e. stars, moon, air, planets, etc.]
However, in Escano vs. Gil [CA] February 11, 1958, it was held
that the right to office, though not a vested property right, in a
technical sense, is property. An office may be considered as
property in controversies relating to the question as to which of
two persons is entitled thereto.
In Cornejo vs. Gabriel, 41 Phil. 200, it was ruled that property,
under the due process clause of the Constitution, includes the
right to hold, occupy and exercise an office.
What is appropriation? The New Civil Law Code does not define
what appropriation is, but it has been considered as equivalent to
occupation, which is the willful apprehension of a corporeal
object which has no owner, and with intent to acquire its
ownership. Those that can be subject of ownership
PROPERTY, classification of: (See Art. 414, NCC)
§ Immovable or real property;
§ Movable or personal property.
Why is there importance to classify? Because different provisions
of the law govern the acquisition, possession, disposition, loss
and registration of immovable and movable.
For example:
a. Donations of real property (like land) must be in a
public instrument, otherwise the alienation will be null
and void even as between the parties. On the other
hand, the donation of a movable (like a ring valued at
say P5,000.00), needs only to be in a private
instrument. (see Art. 748, NCC).
b. The ownership over a real property may be acquired by
prescription (see Art. 1137) in 30 years (bad faith);
whereas, acquisition of personal property in bad faith
needs only 8 years (see Art. 1132, NCC).
c. Generally, to affect third persons, transactions involving
real property must be recorded in the Registry of
Property; this is not so in the case of personal property.
QUESTION: May parties by agreement treat as personal
property that which by classification under the law be real
property?
A: Technically, it would seem that under the Civil Code, it is only
the LAW which may consider certain real property (like growing
crops) as personal property for the purpose of making a chattel
mortgage. (See Art. 416, par.2). Also, for purposes of taxation,
improvements on real property which are essentially movables
may be considered as subject to real property tax.
However, in Evangelista vs. Abad, 36 O.G. 2913 and Navarro
vs. Pineda, 9 SCRA 631, the Supreme Court ruled that a real
property may be treated as personal property provided that two
Marianne Macayra
Compiled and discussed by ATTY. ED C. BATACAN
conditions are met: a) The parties mutually agree to consider
the real property [i.e. house], a personalty; and b) That no
innocent third person shall be prejudiced thereby.
The validity of the chattel mortgage constituted on a house
cannot be questioned by the owner of the house because he is
placed under estoppel from denying the existence of the chattel
mortgage.
In Tsai vs. Court Of Appeals, 366 SCRA 324, it was held that
the nature of the disputed machineries, i.e., that they were heavy,
bolted or cemented on the real property mortgaged, does not
make them ipso facto immovable under Article 415 (3) and (5) of
the New Civil Code, as the parties’ intent has to be looked into.
While it is true that the controverted properties appear to be
immobile, a perusal of the Contract of Real and Chatttel
Mortgage executed by the parties show a contrary indication.
In the case at bar, the intention of the parties is to treat the said
machineries and equipment as chattels. The parties executed a
Real Estate Mortgage and Chattel Mortgage, instead of just Real
Estate Mortgage if indeed their intention is to treat all the
properties included therein as immovable. Also attached to the
said contract is a separate “List of Machineries and Equipment”.
These facts evince the conclusion that the parties intend to treat
the machineries as chattels.
QUESTION: May a building subjected to a chattel mortgage be
sold extra-judicially in accordance with the provisions of Real
Estate Mortgage Law?
A: In Luna vs. Encarnacion, 91 Phil 531, it was held that a
building subjected to chattel mortgage cannot be sold extra-
judicially under the provisions of Act 3135 since the Article refers
only to real estate mortgage.
In Manarang vs. Ofilada, 99 Phil 108, it was ruled that auction
sales on execution upon judgment, the building or house shall be
treated as real property, and therefore, the rule on foreclosure of
real estate mortgage must be followed.
IMMOVABLE PROPERTY
Classes of Immovable (IN GENERAL):
a) Immovables by nature - those which cannot be
moved from place to place because of their nature,
such as land (par 1 Art. 415), mines, quarries and slag
dumps (par 8, Art. 415);
b) Immovables by incorporation - those which are
essentially movables, but are attached to an
immovable in such manner as to become an integral
part thereof. [Examples: those mentioned in par 1, 2, 3,
4 & 6, Art. 415, except land, buildings and roads];
c) Immovables by destination - those which are
essentially movables, but by the purpose for which they
have been placed in an immovable, partake the nature
of the latter because of the added utility derived
 Page 2 of 2
therefrom, such as those mentioned in pars 4, 6, 7 & 9
of Art. 415);
d) Immovables by analogy or by law - those mentioned
in par 10, Art. 415; right of usufruct; easements and
servitudes.
Classes of Immovables (SPECIFICALLY):
Art. 415. The following are immovable property:
PARAGRAPH 1: Land, buildings, roads and
constructions of all kinds adhered to the soil.
REMINDERS:
· LAND:
Land by its very nature is immovable. And even, if land is
moved by an earthquake or an extra-ordinary happening, the
land should still be considered immovable. A truckload of soil
[i.e. garden soil] should be considered personal property since
there is no longer adherence to the soil.
Even if land is rented, it is still considered as immovable.
· BUILDINGS:
Buildings of permanent structure are always classified as
immovable. It is immaterial whether it is built on a rented or
owned land. The nature of the building as property does not
depend on the way the parties deal with it [see: Leung Yee vs
Strong Machinery Co. 37 Phil. 664.]
Buildings are considered immovable provided they are more
or less permanent substantially adhering to the land, and not
mere super-impositions on the law. In Luna vs Encarnacion, it
was held that a structure which is merely superimposed on a land
like a temporary shelter for workers is not real or immovable
property.
· CONSTRUCTIONS:
It is understood that the attachment must be more or less
permanent. A wall or a fence is good example of this kind of
immovable by incorporation. As long as there is an intent to
permanently annex the same, it is immaterial whether the
materials used is only made of stone. Railroad tracks or rails
come under this category.
Wooden scaffoldings on which carpenters stand while
constructing a house are merely personal property in view of the
lack of “adherence” to the soil or the intent to permanently annex
the same to the soil.
PAR. 2: Trees, plants and growing crops, while they are
attached to the land or form an integral part of an
immovable.
Trees and plants no matter what their size may be are
considered real property. By nature - if they are the spontaneous
products of the soil, and by incorporation - if they were planted
thru labor.
But the moment they are detached or uprooted from the land,
they become personal property, except in the case of uprooted
timber, if the land is timberland, because although no longer
attached, the timber still forms an “integral part” of the timberland.
Marianne Macayra Retains being REAL PROPERTY
Rule on ungathered fruits:
1. Even if the land is being leased by another, and the
fruits belong to the tenant, the fruits are still considered
as immovable because no exception or qualification is
made under the Civil Code.
2. However, when the fruits although ungathered are sold,
as when the entire harvest is sold before being actually
gathered, it is considered as a sale of movables.
[Mobilized by anticipation]
In Sibal vs. Valdez, 50 Phil 512, the Supreme Court held that for
purposes of attachment and execution, and for purposes of the
Chattel Mortgage Law, ungathered products have the nature of
personal property.
PAR. 3: Everything attached to an immovable in a fixed
manner, in such a way that it cannot be separated
therefrom without breaking the material or deterioration
of the object.
Under this paragraph, for the incorporated thing to be considered
real property, the injury or breakage or deterioration in case of
separation, must be substantial. [Examples: A fixed fire escape
stairway firmly embedded in the walls of the house; aqueduct; or
a sewer or a well.
In CBAA vs. MERALCO, 119 Phil. 328, it was ruled that the
steel towers of MERALCO not attached to an immovable in a
fixed manner are not realty and therefore, not subject to realty
tax. The towers can be separated from the ground without
breaking or causing deterioration upon the object to which they
are attached.
However, in Caltex vs. CBAA, 114 SCRA 273, it was held that
storage tanks installed on land leased from Caltex are subject to
realty tax, they being improvements on realty.
In Berkenkotter vs. Cu Unjieng, 61 Phil 683, it was ruled that
machinery for breweries utilized in the liquor or soft-drink
manufacturing, though movable in nature, are immobilized by
destination being essential to said industry. Essential - immovable
REAL property
In Mindanao Bus Co. vs. City Assessor, 116 Phil 501, it was
held that machinery of a transportation company such as
welding, boring machine, lathe machine “sitting on a cement
platform” which are not essential to the transportation business of
the owner of the tenement do not constitute realty. Non essential
Effect of separation: If the thing incorporated is temporarily
removed with the intention to replace the same, the thing is
considered as personal property because the incorporation had
ceased. The material fact of incorporation or separation is what
determines the condition of the tenement; it recovers its status as
movables, irrespective of the intention of the owner.
PAR. 4: Statues, reliefs, paintings or other objects for
use or ornamentation, placed in building or on land by
the owner of the immovable in such a manner that it
reveals the intention to attach them permanently to the
tenements.
These are immovables both by incorporation and by destination.
 Page 3 of 3

Example: elements of a sugar central, without them the sugar central would
be unable to function or carry on the industrial purpose for which
A fixed statue in the garden of the house; a permanent painting
it was established. The new machinery must, therefore, be
on the ceiling; a picture embedded in the concrete walls of a
considered as subject to the real estate mortgage in favor of the
house; a rug or carpet fastened to the floor (wall-to-wall
defendant.”
carpeting).
Effect of separation: If the machines are still in the building, but
The objects must be placed by the owner of the immovable
no longer used in the industry conducted therein, the machines
(buildings or lands) and not necessarily the owner of the object. If
revert to the condition of a chattel. The moment they are
placed by a mere tenant, the objects must remain chattels or
separated from the purpose of the industry (not necessarily from
personalty (See: Davao Sawmill vs. Castillo, 61 Phil 709).
the immovable), they recover their (not necessarily from the
However, in Valdez vs. Central Altagracia, 255 U.S. 58, it was immovable), they recover their condition as movables (see: Ago
held that where the owner of a tenement entered into a contract vs. Court of Appeals, 6 SCRA 530).
with a lessee, stipulating that the lessee shall place certain
On the other hand, if still needed for the industry, but separated
objects in the property leased, and that such objects shall remain
from the tenement temporarily, the property continues to be
with the property upon the termination of the lease, without any
immovable, inasmuch as par. 5 refers not to real property by
obligation on the part of the owner to reimburse the lessee, the
incorporation, but to real property by destination or purpose.
tenant acts as an agent of the owner in giving by contract a
permanent destination to them. PAR. 6: Animal houses, pigeon-houses, beehives,
fishponds or breeding places or similar nature, in case
Effect of separation: In Ago vs. Court of Appeals, 6 SCRA
their owner has placed them or preserves them with the
530, it was held that the moment these objects are separated
intention to have them permanently attached to the
from the land or building or from the industry or works, they
land, and forming a permanent part of it; the animals in
regain back their condition as personal property.
these places are included.
PAR. 5: Machinery, receptacles, instruments, or
The houses referred to here may already be deemed included in
implements intended by the owner of the tenement for
par. 1 when speaking of “constructions of all kinds adhered to the
an industry or works which may be carried on in a
soil.” Even if the animals are temporarily outside, they may still
building or on a piece of land, and which tend directly
be considered as real property as long as the intent to return is
to meet the needs of the said industry or works.
present, as in case of a homing pigeon. But from the viewpoint of
These are immovables by purpose or destination. criminal law, they are considered as personal property and may
properly be the objects of theft or robbery.
Essential requisites:
When the animals inside the permanent animal houses are
1. The placing must be made by the owner of the alienated onerously or gratuitously, the transaction is an
tenement, his agent, or duly authorized legal alienation of personal property, unless the building or the
representative; tenement itself is also alienated. This is because in said
2. The industry or works must be carried on in the building
alienation, the animal structures must of necessity be detached
or on the land;
from the immovable. Hence an ordinary inter-vivos donation of a
3. The machines, etc. must tend directly to meet the pigeon-house need not be in a public instrument.
needs of said industry, and not merely incidental.
PAR. 7: Fertilizers actually used on a piece of land.
In Mindanao Bus Co. vs. City Assessor, 116 Phil 501, it was
ruled that a transportation business is not carried on in a building Fertilizers still in the barn and even those already on the ground
or in the compound. Cash registers, typewriters, etc. usually but wrapped inside some newspapers or any other covering are
found and used in hotels, restaurants, theaters, etc., are merely still to be considered personal property, for they have not yet
incidentals, and should not be considered immobilized by been “actually” used or spread over the land.
destination for these business can continue or carry on their
The fertilizers should be on the land where they are to be utilized,
functions without these equipments. The same applies to the
because it is only that the intention of the owner to use them on
repair or service shop of the transportation business because the
the tenement is beyond doubt. Hence, fertilizers kept in the
vehicles may be repaired or serviced in another shop belonging
farmhouse are not immovable.
to another.
PAR. 8: Mines, quarries, and slag dumps while the
In Berkenkotter vs. Cu Unjieng, 61 Phil 663, the Supreme
matter thereof forms part of the bed, and waters, either
Court held: “Machinery intended by the owner of any building or
running or stagnant.
land for the use in connection with any industry or trade being
carried on therein and which are expressly adapted to meet the Mines, including the minerals still attached thereto, are real
requirements of such trade, are considered as real property. If properties, but when the minerals have been extracted, the latter
the installation of the machinery and equipment in question in the become chattels.
central converted them into real property by reason of their
Slag dump is the dirt and soil taken from a mine and piled upon
purpose, it cannot be said that their incorporation therewith was
the surface of the ground. Inside the “dump” can be found the
not permanent in character because, as essential and principal
minerals.
Marianne Macayra
 Page 4 of 4
The “waters” referred to are those still attached to or running thru
the soil or ground. But the “water” itself as distinguished from
“waters” is clearly personal property. On the other hand, canals,
rivers, lakes, and such part of the sea as may be the object of
appropriation, are classified as real property.
PAR. 9: Docks and structures which, though floating,
are intended by their nature and object to remain at a
fixed place on a river, or coast.
A floating house tied to a shore or bank post and used as a
residence is considered real property, considering that the
“waters” on which it floats, are considered immovables. In a way,
we may say that the classification of the accessory (the floating
house) follows the classification of the principal (the waters).
However, if the floating house makes it a point to travel from
place to place, it assumes the category of a vessel.
By express provision of Art. 585 of the Code of Commerce,
vessels are movable property; but they partake, to a certain
extent, of the nature and conditions of the property, on account of
their value and importance in the world of commerce. (See:
Rubiso vs. Rivera, 37 Phil. 72)
Vessels are considered personal property. As a matter of fact,
they are indeed very movable, (see: PRC vs. Jarque, 61 Phil
229) because they are personal property, they may be the
subject of the chattel mortgage. (See: McMicking vs. Espanol-
Filipino, 13 Phil 429; Arroyo vs. Yu de Sane, 54 Phil 7)
PAR. 10: Contracts for public works, and servitudes and
other real rights over immovable property.
The properties referred to in this paragraph are not material
things but rights, which are necessarily intangible. The piece of
paper on which the contract for the public works has been written
is necessarily personal property, but the contract itself, or the
right of the contract is real property.
A servitude or easement is an encumbrance imposed upon an
immovable for the benefit of another immovable belonging to a
different owner, or for the benefit of a person, group of persons,
or a community [ex. Easement of right of way].
Other real rights over real property include real estate mortgage,
antichresis, possessory retention, usufruct, leases of real
property, if registered; or even if not registered, if their duration is
for more than a year.
Usufruct of personal property or a lease of personal property
should be considered personal property.
In the case of Presbitero vs. Fernandez (March 30, 1958), the
Supreme Court held that sugar quotas are real property, for they
are by law considered “real rights over immovable property” just
like servitudes and easements.
Court jurisdiction: In Cabutihan vs. LCDC, 383 SCRA 353, it
was held that actions affecting title to or possession of real
property or an interest therein shall be commenced and tried in
the proper court that has territorial jurisdiction over the area
where the real property is situated.
Marianne Macayra
MOVABLE PROPERTY
Art. 416. The following things are deemed to be personal
property:
1. Those movables susceptible of appropriation which
are not included in the preceding article.
Examples: cell phones; money; ring; cars.
2. Real property which by any special provision of law is
considered as personalty.
Examples: Growing crops for the purpose of the Chattel
Mortgage Law (see: Sibal vs. Valdez, 50 Phil. 512); machinery
placed on a tenement by a tenant, who did not act as the agent
of the tenement owner (see: Davao Sawmill vs. Castillo, 61
Phil. 709).
3. Forces of nature which are brought under control by
science.
Examples: Electricity, gas, light, nitrogen (see: US vs.
Carlos, 21 Phil. 543).
4. In general, all things which can be transported from
place to place without impairment of the real property to
which they are fixed.
Examples: Machinery not attached to land or needed for the
carrying on of an industry conducted therein.
Test to determine whether property is movable or
immovable:
a) If the property is capable of being carried from place to
place. (Test by description)
b) If such change in location can be made without injuring
the real property to which it may in the meantime be
attached. (Test by description)
c) And if finally, the object is not one of those enumerated
or included in Art. 415. (Test by exclusion)
(If the answer is YES) Then the inevitable conclusion is that the
property is personal property.
Note: Test by exclusion is superior to test by description.
Art. 417. The following are also considered as personal
property:
1.) Obligations and actions which have for their object
movables or demandable sums.
REMINDERS: The term obligations really refers to ”credits”
and also includes bonds, which are technically obligations of the
entity issuing them; Actions – if somebody steals my car, my
right to bring action to recover the automobile is personal
property by itself; A promissory note is a personal property; the
right to collect it is also a personal property.
2) Shares of stock of agricultural, commercial and
industrial entities, although they may have real estate.
Although the provisions of par. 2 seem to refer only to
corporations by the words “shares of stocks”, and only to those
engaged in agriculture, commerce, and industry, nevertheless, all
juridical persons must be deemed included.
 Page 5 of 5
A share of stock in a gold mining corporation is also
personal property; but the gold mine itself, and any land of the
corporation, are regarded as real property by the law. The
certificate evidencing ownership of the share, and the share
itself, are regarded as personal property. Being personal, they
may be the object of a chattel mortgage (see: Chua Guan vs.
Samahang Magsasaka, Inc. 62 Phil. 472)
A half interest in drugstore business is personal property capable
of being the subject of a chattel mortgage (see: Strochecher vs.
Ramirez, 44 Phil. 933). However, a half-interest in a drugstore,
considered as a building (not a business) is a real right in real
property and is therefore by itself a real property.
In Hongkong and Shanghai Bank vs. Aldecoa, 30 Phil 255, it
was held that real estate mortgages are realty and not
personalty.
PROPERTY IN RELATION TO THE PERSON TO WHOM IT
BELONGS
Art. 419. Property is either of public dominion or of private
ownership.
The State may own properties both in its public
capacity (public dominion) and private capacity
(patrimonial).
§ Public dominion – ownership by the state in its public
capacity or in the exercise of its governmental functions.
§ Patrimonial – ownership by the State in its private capacity or
in the course of its proprietary functions. This is the property
over which the State has the same rights, and for which it may
dispose, to the same extent as private individuals in relation to
their property, subject only to the administrative laws and
regulations on the procedure of exercising such rights. They
exist for the State to attain its economic ends, as a means for
its subsistence, and the preservation of its natural organism.
What are properties of public dominion? [see Art 420, NCC]
a. 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;
b. 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.
In Usero vs. CA, 353 SCRA 449, the SC held that the phrase
“others of similar character” includes a creek which is a recess or
an arm of a river. It is property belonging to the public domain
which is not susceptible to private ownership. Being public water,
a creek cannot be registered under the Torrens System in the
name of any individual.
Characteristics:
1. They may be real or personal;
2. They cannot be levied or attached; [Tan Toco vs.
Mun. Council of Iloilo, 49 Phil 52];
Marianne Macayra
3. They cannot be registered under the Land Registration
Law;
4. They cannot be acquired by prescription [Harty vs.
Mun. of Victoria, 13 Phil. 152];
5. They are outside the commerce of man [Mun. of
Cavite vs Rojas, 30 Phil 20];
6. They cannot be burdened by any voluntary easement.
Property for PUBLIC USE, defined: It can be used by
everybody, even by strangers or aliens in accordance with its
nature; but nobody can exercise over it the rights of a private
owner. Thus, no private person can have a property right in the
use of a street for his private business, nor can he acquire over
such a right to possession as would require the exercise of
possessory actions.
In Republic vs. Gonzales, 199 SCRA 788, it was held that: the
conception urged by appellants to restrict property reserved for
public use to include only property susceptible of being used by a
generally unlimited number of people is flawed and obsolete,
since the number of the users is not the yardstick in determining
whether property is properly reserved for public use or benefit.
To constitute public use, the public in general should have equal
or common rights to use the land or facility involved on the same
terms, however limited in the number of people who can actually
avail themselves of it at a given time. There is nothing in the law
which excludes non-car owners from using a widened street or a
parking area should they in fact happen to be driving cars. The
opportunity to avail of the use thereof remains open for the public
in general.
In Villarico vs. Sarmiento, 110 SCRA 442, the SC ruled that:
“Public use is use that is not confined to privileged individuals but
is open to the indefinite public. Records show that the lot on
which the stairways were built is for the use of the people as
passageway to the highway. Consequently, it is a property of
public dominion.”
Property for PUBLIC SERVICE: - This kind of property includes
all property devoted for public service. In Baguio Citizens
Action vs. City Council, 121 SCRA 368, it was held that all
public buildings constructed by the State for its offices and
functionaries belong to this class.
QUESTION: Are rivers whether navigable or not, properties of
public dominion?
A: It would seem that Art. 420 NCC makes no distinction.
However, in Palanca vs. Commonwealth, 40 OG 148, the
Supreme Court said: “The river Viray and the estero Sapang
Sedoria, being navigable, useful for commerce, for navigation,
and fishing, they have the character of public domain.”
In Taleon vs. Secretary of Public Works, L-24281, May 16,
1967, it was held that if a river is capable in its natural state of
being used for commerce, it is navigable in fact, and therefore,
becomes a public river.
In Martinez vs. Court of Appeals, 56 SRCA 647, it was held
that navigable rivers are outside the commerce of man and
therefore cannot be registered under the Land Registration Law.
If converted into fishponds, the latter can be demolished
 Page 6 of 6
notwithstanding the title, for said title cannot convert the streams
into private ones.
In Mercado vs. Municipal President of Macabebe, 59 Phil 592,
it was ruled that creeks which are mere extensions of rivers are
considered property of public domain.
CONVERSION
Art. 422. Property of public dominion, when no longer
intended for public use or for public service, shall form
part of the patrimonial property of the state.
Note:
¬ When change takes effect? Property of public dominion
ceases to be such and becomes private property of the State
only upon declaration by the government, thru the legislative or
executive departments, to the effect that it is no longer needed
for public use or public service. If the property has been
Even if no longer intended for such use or service, and the government has not
utilized BUT no devoted it to other uses, or adopted any measure which
legislative or amounted to a withdrawal thereof from public use or service,
executive order the same remains property for public use or service
to convert/sell
notwithstanding the fact that it is not actually devoted for public
use or service. (See:Capitulo, et. al. vs. Aquino 53 OG 1477)
¬ Who shall declare? In the case of Faustino vs. Dir. Of
Lands, L-12958, May 30, 1960, the Supreme Court, (citing
Natividad vs. Dir. Of Lands, CA 37 OG 2905) said that only
the executive and possibly the legislative departments have
the authority and power to make the declaration that any land
so gained by the sea is not necessary for purposes of public
utility, or for the establishment of special industries. If no such
declaration has been made by the said departments, the lot in
question forms part of the public domain.
Consequently, until there is made a formal declaration on the part
of the government thru the executive department or the
legislature, the parcel in question continues to be part of the
public domain and cannot be subject to acquisitive prescription.
In Laurel vs. Garcia, 187 SCRA 799, the Supreme Court said :
It is not for the President to convey valuable real property of the
government on his or her own sole will. Any such conveyance
must be authorized and approved by law enacted by Congress.
It requires executive and legislative concurrence.
See: Coaco vs. Bercilles, 66 SCRA 481.
See also: International Hardwood vs. Univ. of the Philippines,
August 13, 1991, 200 SCRA 554.
OWNERSHIP IN GENERAL
Art. 427. Ownership may be exercised over things or rights.
A person has the right to control a thing particularly in his
possession, enjoyment, disposition, and recovery, subject
to no restriction except those imposed by the law.
Right to Enjoy: In Marcos vs. Endencia, 38 O.G. 855, it was
ruled that the right to enjoy consists not only in the right to collect
the rents or fruits, in short, the benefits which accrue from the
Marianne Macayra
thing, but also in the right to use and utilize the same according
to its natural destination and in the right, besides, to make the
thing serve one’s necessities, one’s pleasures, and even, within
the letter and spirit of the law, personal whims.
QUESTION: If a land has been foreclosed by the mortgagee,
does the mortgagor still have the right to enjoy his foreclosed
property?
A: YES, but only during the period of redemption. In GSIS vs.
CA, 377 SCRA 54, it was held that the mortgagor has the right to
redeem his property, possession, use and enjoyment of the same
during the period of redemption.
Limitations on ownership:
1. Imposed by law: Easement of right of way; party wall;
drainage.
2. Imposed by state: Police power; Power of taxation; Power of
eminent domain.
3. Imposed by owner: In cases of lease, the owner cannot in
the meantime physically occupy the property; (also
pledges).
4. Imposed by grantor: The donor may prohibit the donee from
partitioning the property for a period not exceeding 20 years.
DOCTRINE OF SELF-HELP
Art. 429. The owner or lawful possessor of a thing has the
right to exclude any person from enjoyment and disposal
thereof. For this purpose, he may use such force as may be
reasonably necessary to repel or prevent an actual or
threatened unlawful physical invasion or usurpation of his
property.
This article was taken from Art. 227 of the German Civil Code
which provides: An act impelled by legitimate necessity shall not
be unlawful. Legitimate necessity consists in the defense
indispensable to repel, personally or thru another, an actual or
unjust situation.
Principle of self-help: It is lawful to repel force by means of
force. It implies that the state of things to be defended enjoys
juridical protection. It is sort of self-defense, where the use of
such necessary force to protect proprietary or possessory rights
constitutes a justifying circumstance under the Penal Code.
The actual invasion of property may be:
a. Mere disturbance of possession – force may be
used against it at any time as long as it continues, even
beyond the prescriptive period for an action of forcible
entry. Thus if a ditch opened by Pedro in the land of
Juan, the latter may close it or cover it by force at any
time.
b. Real dispossession – force, to regain possession can
only be used immediately after the dispossession.
Thus, if Juan without the permission of Pedro picks up
a book belonging to the latter and runs off with it, Pedro
can pursue Juan and recover the book by force.
In German Management & Services, Inc. vs. CA, 177 SCRA
495, it was held that the doctrine of self-help can only be
 Page 7 of 7
exercised at the time of actual or threatened dispossession.
When possession had already been lost, the owner must resort
to judicial process for the recovery of property.
In People vs. Segovia, 103 Phil 1162, the SC ruled that the
owner of the plants who shot an animal to death, out of
vengeance is not justified under the rule. The proper move for
him to do is to drive away the animal and then seek damages
from the owner of the animal. For shooting and killing the animal,
he can be convicted of malicious mischief.
Nature of the aggression: The aggression must be illicit or
unlawful. The right to self-help is not available against the
exercise of right by another, such as when the latter executes an
extra-judicial abatement of nuisance. Neither can it be used
against the lawful exercise of the functions of a public official,
such as a sheriff attaching property.
DOCTRINE OF ACTS IN A STATE OF NECESSITY
Art. 432. the owner of a thing has no right to prohibit the
interference of another with the same, if the interference is
necessary to avert an imminent danger and the threatened
damage, compared to the damage arising to the owner from
the interference, is much greater. The owner may demand
from the person benefited indemnity for the damage to him.
This article, following the same principle of self-help contained in
the second part of Article 429, allows the use of defensive force
to preserve an existing situation, as against an external event
which the passive subject is entitled to repel as much as an
unlawful aggression by another.
Examples of danger contemplated by this article are: the attack
of animals, the spread of fire, the threat of flood, etc. The
attacking animal, belonging to another may be killed by the
victim; a house in the path of a fire may be demolished; and a
dike may be destroyed at one point to prevent a flood over other
places. The law permits the injury or destruction of things
belonging to other provided this is necessary to avert a greater
danger.
Requisites:
1. Existence of an evil sought to be avoided;
2. The injury feared is greater than that done to avoid it;
3. That there be no other practical and less harmful
means of preventing it;
4. The means employed is necessary and indispensable
to avert danger.
Effect of mistake: The right to act in a state of necessity
depends upon the objective existence of the danger with the
requisites provided by law. If through error, one believed himself
to be in a state of necessity, or used means in excess of the
requirements, his act would be illicit and the owner of the
property used against him the defensive force authorized in Art.
429.
Effect of negligence: The law does not require that the person
acting in a state of necessity be free from negligence in the
creation of such situation. Thus, if a person picks up an unknown
object in a drug store and eats it, thinking it to be candy, and it
Marianne Macayra
turns out to be poison, he can lawfully drink any antidote he may
find in the store, even without the consent of the owner.
Basis of liability: The obligation to indemnity does not depend
upon imputability. The basis of the liability is the benefit derived.
Conflict of rights: The right of self-help under Article 429 is not
available against an act in a state of necessity.
Concept of just compensation
Just compensation: The fair and full equivalent for the loss
sustained (Mla. Railroad vs. Velasquez, 32 Phil 286). The
market value of the condemned property plus consequential
damages less consequential benefits (Manila Railroad vs.
Fabie, 17 Phil. 208); See also EPZA vs. Dulay, 149 SCRA 305.
QUESTION: May real property be subjected to an easement of
right of way through expropriation?
A: In Republic vs. PLDT, 26 SCRA 620, the SC ruled that
normally, expropriation deals with a transfer of title or ownership;
there is nothing wrong, therefore, in imposing a burden less than
the transfer of ownership. It is unquestionable that real property
may through expropriation be subjected to an easement of right
of way.
QUESTION: In the event that the purpose of the expropriation is
abandoned or withdrawn, is the previous owner entitled to
reacquire the property?
A: In Fery vs. Municipality of Cabanatuan, 42 Phil 28, the SC
ruled that if the decree granted full ownership to the petitioner,
the latter remains the owner regardless of the disappearance or
cessation of the public need for the property. If the grant of
ownership or title is subject to the condition that it will revert to
the owner when the purpose of the expropriation is terminated or
abandoned, the original owner of the property would reacquire
the property.
FORMULA: Market value + consequential damages –
consequential benefits. [MRR vs. Velasquez, 32 Phil 286]
Illustration:
PhP 10,000,000.00 market value of land
+ 2,000,000.00 consequential damages as when a
building is demolished
PhP 12,000,000.00
- 1,000,000.00 consequential benefits as when
market value of his separate adjacent
property increased
PhP 11,000,000.00 amount of just compensation
RIGHT OF ACCESSION
Art 440. The ownership of property gives the right by
accession to everything which is produced thereby, or
which is incorporated or attached thereto, either naturally or
artificially.
Accession, meaning of: The right of a property owner to
everything which is produced thereby or which is incorporated or
attached thereto. “To the owner of the principal belongs the
accessory.”
 Page 8 of 8

ACCESSION

DISCRETA (Produced) CONTINUA (Incorporated)

NATURAL INDUSTR’L CIVIL REAL PERSONAL

Spontaneous Those Rents of INDT’L NATURAL Adjun Mix Spec

products of the produced by buildings;
soil; lands of any Price of Building Alluvium Engraftment; Confusion (liquid);
The young and kind thru leases; Planting Avulsion attachment; Commixtion
other products cultivation or Amount of Sowing Change of weaving (solids)
of animals labor perpetual or course of painting;
life rivers writing
annuities. formation of
islands

REMINDER: RIGHTS OF THE LANDOWNER

Instances when the owner of land does not own the fruits: Art. 447. The owner of the land who makes thereon
personally or thru another, plantings, constructions or
§ Possessor in good faith of the land. (He owns the fruits
works with the materials of another shall pay their value;
already received.) (see : Art 544, par 1)
and if he acted in bad faith, he shall also be obliged to the
§ Usufruct. The usufructuary owns the fruits. (see Art 566) reparation of damages. The owner of the materials shall
have the right to remove them only in case he can do so
§ Lease. The lessee gets the fruits of the land. (Of course, the without injury to the work constructed, or without the
owner gets the civil fruits in the form of rentals.) See Art. plantings, constructions or works being destroyed.
1654 However, if the landowner acted in bad faith, the owner of
§ In antichresis, the antichretic creditor gets the fruits, the materials may remove them in any event, with a right to
although said fruits should be applied first to the interest, if be indemnified for damages.
any is owing; and then to the principal amount of the loan. LANDOWNER
(see : Art. 2132)
Good Faith Bad Faith
Right to appropriate the 1. Liable to pay the value of the
RIGHT OF ACCESSION WITH RESPECT TO IMMOVABLE materials but he must pay its materials plus damages;
value; or return the materials 2. Owner of the materials may
PROPERTY
provided they are not remove them whether there is
GEN. RULE: transformed at the expense of injury or none, plus damages.
the landowner
Art. 445. Whatever is built, planted or sown on the land of
another and the improvements or repairs made thereon, The owner of the materials
belongs to the owner of the land. may remove them provided
that there is no injury to the
To the owner of the principal (land for example) must belong also work constructed.
the accessions – in accordance with the principle that the
“accessory follows the principal.”
Note: There is no provision of law which applies to a situation
NOTE: This article deals with accession continua more where the landowner is in good faith while the owner of the
specifically accession industrial – BUILDING, PLANTING, material is in bad faith.
SOWING.
However, it would seem that the landowner would not only be
Exception: Art. 120 of the Family Code: A building constructed exempted from reimbursement, but would also be entitled to
on the land owned by one of the spouses at the expense of the consequential damages (as when for instance, the materials are
conjugal partnership will belong to the partnership or to the of inferior quality). Moreover, the owner of the materials would
spouse who owns the land depending on which of the two lose all rights to them, such as the right of removal, regardless of
properties has a higher value. whether substantial injury would be caused.
If the land is more valuable than the building, the building shall be REMINDERS:
owned by the owner of the land. If the building is more valuable
than the land, the entire property shall belong to the conjugal § Under Art. 447. The landowner himself (as distinguished
partnership. In both cases, there is right of reimbursement at the from Art. 448) makes the PLANTINGS, CONSTRUCTIONS
time of liquidation of the conjugal partnership. OR WORKS on his land, BUT with the materials of another
person.

Marianne Macayra
 Page 9 of 9
§ In such a situation, a NEW THING is produced (i.e.
something that is built or constructed on a land by the
landowner with the materials of another), but does not result
in co-ownership. The owner therefore of the materials does
not become part owner of the new thing. He is only entitled
to recover their value.
§ In short, the law gives the LANDOWNER, who acted in
good faith, the right to APPROPRIATE the new thing
provided that he INDEMNIFIES the owner of the materials.
QUESTION: What if the landowner offers to dismantle the new
thing and return the materials thereof to its owner?
A: Strictly speaking, the law does not grant this option. What the
law provides is the right (of the landowner) to pay for the value of
the materials. However, when the materials can be removed
without causing injury thereof (i.e. statues, ornaments or other of
like nature), or when the materials had not been transformed, the
landowner may return them at his expense to the owner of the
materials.
QUESTION: What if the new thing is dismantled, is the right of
the owner of the materials revived?
A: It would seem that the law attributes ownership to the
landowner by giving them the option to pay for their value, hence,
the right of the owner of the materials is not revived. However,
the better rule should be that as long as there is no injury to the
work constructed or to the planting, the same may be recovered
by the owner thereof.
REMINDERS:
§ In case of alienation by the landowner, the owner of the
materials may go against the new owner, because he is the
one benefited by the accession. (Pacific Farms vs Esguerra
30 SCRA 684)
§ Bad Faith; Good Faith, meaning of – (Cf. Arts. 453 and
526). The builder, planter or sower is in bad faith if he
makes use of the land or materials which he knows belong
to another.
Art. 448. The owner of the land on which anything has been
built, sown or planted in good faith, shall have the right to
appropriate as his own the works, sowing or planting, after
payment of the indemnity provided for in Article 546 and 548
or to oblige the one who built or planted to pay the price of
the land, and one who sowed, the proper rent.
However, the builder or planter cannot be obliged to
buy the land if its value is considerably more than that of
the building or trees. In such case, he shall pay reasonable
rent if the owner of the land does not chose to appropriate
the building or trees after indemnity. The parties shall agree
upon the terms of the lease and in case of disagreement, the
court shall fix the terms thereof.
Note: This article applies only if the builder, planter or sower is in
good faith. (See also Arts. 454 and 447.)
Applicability of Art. 448:
In Pecson vs. Court Of Appeals, 244 SCRA 407, it was
held that Article 448 applies only to a land whose ownership is
Marianne Macayra
claimed by two or more parties, one of whom has built some
works, one sown or planted something. It does not apply to a
case where the owner of the land is the builder, sower or planter
who then later loses ownership of the land by sale or donation.
Nevertheless, the provision therein with respect to indemnity may
be applied by analogy considering that the primary intent of Art.
448 is to avoid a state of forced co-ownership.
In PNB vs. de Jesus, 557 SCRA 411, the SC held that Art
448 refers to a piece of land whose ownership is claimed by two
or more parties, one of whom has built some works (or sown or
planted something) and, not to a case where the owner of the
land is the builder or sower or planter who then later loses
ownership of the land by sale or otherwise for “where the true
owner himself is the builder of works on his own land, the issue
of good faint or bad faith is entirely irrelevant.”
Who is entitled to possession of the building if the
landowner opts to appropriate the building?
In Pecson [supra], the SC further held: Since the landowner
opted to appropriate the apartment building, the owner of the
building is thus entitled to the possession and enjoyment of the
apartment building, until he is paid the proper indemnity, as well
as of the portion of the lot where the building was constructed.
This is so, because the right to retain the improvements
while the corresponding indemnity is not paid implies the tenancy
or possession in fact of the land which it is built, planted or sown.
The petitioner not having been so paid, he was entitled to retain
ownership of the building, and, necessarily, the income
therefrom. [Cf: Mendoza vs. de Guzman, 54 SCRA 164]
What is the basis of reimbursement, cost of the building or
the market value of the building?
Again, in Pecson [supra], it was held that the objective of
Art. 546 of the Civil Code is to administer justice between the
parties involved in such a way as neither one nor the other may
enrich himself of that which does not belong to him. It is
therefore the current market value of the improvement which
should be made the basis of reimbursement.
A contrary ruling would unjustly enrich the private
respondents who would otherwise be allowed to acquire a highly
valued income-yielding four-unit apartment building for a measly
amount.
QUESTION: May a lessee or a tenant who introduced
improvements on a rented land recover for their value under Art.
448?
A: In Balucanag vs. Francisco, 122 SCRA 498, in relation to
Rivera vs. Trinidad, 48 Phil 396, the SC ruled: “Art 448 does
not apply to a lessee because as such lessee he knows that he is
not the owner of the leased premises. Neither can he deny the
ownership or title of his lessor. A lessee who introduces
improvements in the leased premises, does so at his own risk in
the sense that he cannot recover their value from the lessor,
much less retain the premises until such reimbursement.”
Also, in Chua vs. Court of Appeals, 301 SCRA 358, it was
held that: “…the fact that petitioners made repairs on the
premises is not a reason to retain the possession of the
 Page 10 of 10
premises. There is no provision of law which grants the lessee a
right of retention over the leased premises on that ground.”
“Art. 448 of the Civil Code, in relation to Art. 546, which
provides for full reimbursement of useful improvements and
retention of the premises until reimbursement is made, applies
only to a possessor in good faith, i.e. one who builds on a land in
the belief that he is the owner thereof. This right is not applicable
to a mere lessee, otherwise, it would always be in his power to
“improve” his landlord out of the latter’s property.”
What if both the landowner and the builder are in good faith,
who shall prevail?
In a sense, it is the landowner, since the law grants upon
him the right either to appropriate or compulsory sale. In both
cases however, the builder is also protected.
OTHER REMEDIES:
In Filipinas Colleges vs. Timbang, 106 Phil 247, the SC
held that the land and improvements may be sold at public
auction, applying the proceeds thereof to the payment of the
value of the land and the excess, if any, to be delivered to the
owner of the improvements in payment thereof.
In Miranda vs. Fadullon, 97 Phil 801, it was held that the
parties may decide to leave things as they are and assume the
relation of lessor or lessee; and should they disagree as to the
amount of the rental, they can go to court for the fixing of that
amount.
NOTE: Forced lease is also created when the landowner opts for
compulsory sale [value of land is not immoderate] and the builder
failed to pay.
Can the landowner refuse to exercise both options and
insists on removal?
In Ignacio vs. Hilario, 76 Phil 605, it was held that the
landowner cannot both refuse to pay for the building and to sell
the land to the builder, and compel the latter to remove the
building. He is entitled to seek the removal of the building only if
after having chosen to sell the land, the builder failed to pay for
the same.
Is the landowner entitled to rentals from the builder during
the period of retention?
In Grana vs. CA, 109 Phil 260, the SC ruled that during the
time that the builder is retaining possession of the land, he
cannot be required to pay rentals. Otherwise, the right of
retention will be rendered nugatory.
What is the nature of the right of retention?
The right of retention is security for the payment of
improvements. [Miranda vs. Fadullon, 97 Phil 801]. If the
building is gutted by fire, the basis for right of retention is
extinguished. [Manotok vs. Tecson, 164 SCRA 587].
RULES TO REMEMBER:
IF LANDOWNER IS IN GOOD FAITH
He has two options: (It is the landowner who has the option is
not the builder, planter or sower.)
Marianne Macayra
1. To appropriate for himself anything that has been built,
planted or sown upon the proper payment of indemnity;
(RIGHT OF APPROPRIATION) cf: Ignao vs. IAC 1-
18-91
Note: Ownership over the thing built, sown or planted does not
pass to the landowner until after payment therefore has been
given. In the meantime, the builder, planter or sower (who is in
good faith) has the right of retention (see: Martinez vs.
Baganus, 28 Phil 500);
2. To compel the builder to buy the land unless the value
of the land be considerably more than the value of what
has been built, planted or sown; (RIGHT TO
COMPULSORY SELLING). In this situation, there is
no right of retention because the planter, builder or
sower is the one required to pay. (see: Bernardo vs.
Bataclan, 66 Phil 598)
Generally, the landowner has no RIGHT OF REMOVAL,
except after having selected a compulsory sale, the builder,
planter or sower fails to pay for the land (see: Ignacio vs.
Hilario, 76 Phil 605).
Note: Once a choice is made by the landowner, it is generally
irrevocable. Thus, if the landowner has elected to get the
building, but is finally unable to pay for the indemnity or value of
the building, she cannot afterwards elect to sell the land. (See:
Tayag vs. Yuseco, 97 Phil 712)
IF THE BUILDER, PLANTER IS IN BAD FAITH (Landowner in
good faith): (See: Arts. 449, 450 and 451)
1. He loses what is built, planted or sown without right to
indemnity (except necessary expenses for the
preservation of the land), see: Art 452;
2. He may be required to demolish or remove what is built
or planted or sown;
3. The builder may be compelled to pay the price of the
land (whether or not the value of the land is
considerably higher than the value of the house) and
the sower proper rent;
4. He is liable to pay damages.
QUESTION: If Davao City is invaded and occupied by an enemy
country and an airstrip is constructed on a private land, who shall
own the airstrip after the war, assuming the enemy is defeated?
A: In Republic vs. Lara, 96 Phil 170, it was held that the airfield
belongs to the Republic of the Philippines and not to the owner of
the land. The Japanese Army cannot be considered a possessor
in bad faith so as to make the airfield the property of the
landowner by industrial accession. International law allows the
temporary use by the enemy occupant of private lands and
buildings for all kinds of purposes demanded by the necessities
of war.
ALLUVIUM
Art. 457. To the owners of lands adjoining the banks of
rivers belong the accretion which they gradually receive
from the effects of the current of the waters. (See: Republic
vs. CA, 132 SCRA 514)
 Page 11 of 11
NOTE: This article applies also to creeks, streams, lakes
(although the soil deposited may not be called alluvium.)
Forms of accession natural:
a. Alluvium;
b. Avulsion;
c. Change of course of rivers;
d. Formation of islands.
Alluvium is the soil deposited or added to (accretion) the lands
adjoining the banks of rivers and gradually received as an effect
of the current of the waters. By law, the accretion is owned by
the owner of the estate fronting the river bank (riparian owner).
Accretion is the process whereby soil is deposited; alluvium is
the soil deposited on river banks.
Essential requisites of alluvium:
1. The deposit should be gradual and imperceptible as a
process (natural); Current must be that of a river; does
not apply to accretion by man-made means (see:
Republic vs. CA, 132 SCRA 154);
2. 2. Current must be that of a rive (if lake, the deposit
may not be called alluvium but the principle is the
same, see : Art. 84 Spanish Law on Waters);
3. The river must continue to exist (otherwise, if the river
disappears, Art. 58 PD 1067, in re: Art. 461 NCC, shall
apply);
4. The increase must be comparatively little.
QUESTION: What is the nature of an alluvion and how is it
acquired?
A: In Ferrer vs. Bautista, 231 SCRA 257, it was held that: Article
457 of the Civil Code, under which petitioner claims ownership
over the disputed parcel of land, provides: “Art. 457. To the
owners of land adjoining the banks of rivers belong the accretion
which they gradually receive from the effects of the current of
waters.” Undoubtedly, plaintiff is the lawful owner of the
accretion, she being the registered owner of Lot Not. 1980 which
adjoins the alluvial property.
Alluvion gives to the owners of land adjoining the banks of
rivers or streams any accretion which is gradually received from
the effects of the current of water. The rationale for the rule is to
provide some kind of compensation to owners of land continually
exposed to the destructive force of water and subjected to
various easements.
QUESTION: Does the Director of Land have jurisdiction to grant
title over alluvial claims by third party who is not the riparian
owner?
A: In Ferrer vs. Bautista [supra], the Director of Lands has no
authority to grant a free patent over the land that has passed to
private ownership and which has thereby ceased to be public
land. Any title thus issued or conveyed by him would be null and
void. Private respondents, therefore, acquired no right or title
over the disputed land by virtue of the free patent since at the
time it was issued in 1966, it was already private property and not
part of the disposable land of the public domain.
Marianne Macayra
QUESTION: Is there a need for the riparian owner of making a
formal claim of possession?
A: In Agne vs. Director, 181 SCRA 793, it was held that the
riparian owner may not necessarily make an express act of
possession, it being that the accretion is automatic, the moment
the soil deposit appears.
However, in Grande vs. CA, 6-30-62, it was held that an alluvial
deposit does not automatically become registered land simply
because the lot which receives it is covered by a Torrens Title.
Although the owner of the land on which the alluvial deposit is
made becomes automatically the owner of the alluvial deposit,
the law not requiring any act of possession on his part from the
moment the deposit becomes manifest.
Still ownership of a piece of land is one thing and registration
under the Torrens System is another. In order that the alluvial
deposit may be entitled to the protection of imprescriptibility, the
same must be placed under the operation of the Land
Registration Law. An unregistered alluvial property is therefore
subject to acquisition through prescription by third person.
AVULSION
Art. 459. Whenever the current of a river, creek or torrent
segregates from an estate on its bank a known portion of
land and transfers it to another state, the owner of the land
to which the segregated portion belonged retains the
ownership of it, provided that he removes the same within
two years.
Avulsion - the process whereby the current of a RIVER,
CREEK or TORRENT segregates from an estate on its bank a
KNOWN PORTION of land and transfers it to another estate.
Avulsion implies a violent tearing or breaking away. It may also
be referred to as “delayed accession” in the sense that if the
owner abandons the soil involved, or fails to remove (not merely
claim) the same within two years, the land to which it had been
attached acquires ownership thereof.
REMINDERS:
§ Torrent means a violent, rushing or turbulent stream.
§ The law does not make a distinction whether the portion
segregated is big or small.
§ If the detached portion is not attached to another’s land but
simply is in the middle of the river, ownership still remains
with the person whose land it had been detached.
Art. 462. Whenever a river, changing its course by natural
causes, opens a new bed through a private estate, this bed
shall become of public dominion.
QUESTION: If the cause of the damage is due to artificial
means, is the riparian owner entitled to compensation?
A: In Baes vs. CA, if the riparian owner is entitled to
compensation for the damage to or loss of his property due to
natural causes, there is all the more reason to compensate him
when the change in the course of the river is effected through
 Page 12 of 12
artificial means. The loss to the petitioners of the land covered by
the canal was the result of a deliberate act on the part of the
government when it sought to improve the flow of the Tripa de
Gallina creek. It was therefore obligated to compensate the
Baeses for the loss.
QUIETING OF TITLE
Art. 476. Whenever there is a cloud on title to real property
or any interest therein, by reason of any instrument, record,
claim, encumbrance, or proceeding which is apparently valid
or effective but is in truth and in fact invalid, ineffective,
voidable or unenforceable, and may be prejudicial to said
title, an action may be brought to remove such cloud or to
quiet the title. An action may also brought to prevent a
cloud from being cast upon title to real property or any
interest therein.
Note: Please observe that when the instrument is not valid on its
face, the remedy does not apply.
What is an action for quieting of title?
In Robles vs. CA, 328 SCRA 97, the SC said: An action for
quieting of title is a common law remedy for the removal of any
cloud or doubt or uncertainty on the title to the real property. It is
essential for the plaintiff or complainant to have a legal or an
equitable title to or interest in the real property which is the
subject matter of the action. Also, the deed, claim, encumbrance
or proceeding that is being alleged as a cloud on plaintiff’s title
must be shown to be in fact invalid or inoperative despite its
prima facie appearance of validity of legal efficacy.
What must be proven in an action to quiet title?
In Secuya vs. Vda. De Selma, 329 SCRA 244, it was held
that in an action to quiet title, the plaintiffs or complainants must
demonstrate a legal or an equitable title to, or an interest in, the
subject real property. Likewise, they must show that the deed,
claim, encumbrance or proceeding that purportedly casts a cloud
on their title is in fact invalid or inoperative despite its prima facie
appearance of validity or legal efficacy.
Requisites:
1. Existence of an instrument (deed or contract) or record
or claim or encumbrance or proceeding;
2. The instrument or proceeding is apparently valid or
effective, and prejudicial to the title;
3. In truth and in fact, invalid, ineffective, voidable or
unenforceable, or extinguished.
Test: Would the owner of the property in an action at law brought
by the adverse party and founded upon the instrument or claim,
be required to offer evidence to defeat a recovery? If proof would
be essential, the cloud exists; if proof is not needed, no cloud is
cast.
Example: Alma’s land was sold by Roger (a forger) to B, a buyer
in good faith. Alma’s name had been forged by Roger in the
deed of sale. The sale on its face is apparently valid, with Alma’s
name indicated as the seller. In truth, however, the sale is
Marianne Macayra
defective because of the forgery. Alma’s remedy is an action to
quiet title.
Question: Does an action to quiet title prescribe?
A: It depends, if the plaintiff is in possession of the property, the
action does not prescribe. But if the plaintiff is not in possession
of the property, the action may prescribe (see: Fernandez vs.
Court of Appeals, 189 SCRA 780; Mamadsual vs. Moson, 140
SCRA 83)
In Pingol vs. Court Of Appeals, 226 SCRA 118, the SC
ruled that although the plaintiff’s complaint was denominated as
one for specific performance, it is in effect an action to quiet title.
Prescription thus cannot be invoked against the private
respondents for it is aphoristic that an action to quiet title to
property in one’s possession is imprescriptible. The rationale for
this rule has been aptly state thus: “The owner of real property
who is in possession thereof may wait until his possession is
invaded or his title is attacked before taking steps to vindicate his
right. A person claiming title to real property, but not in
possession thereof, must act affirmatively and within the time
provided by the statute.
Possession is a continuing right as in the right to defend
such possession. So it has been determined that an owner of
real property in possession has a continuing menace to his title.
Such menace is compared to a continuing nuisance or trespass,
not barred by statute until continued without interruption for a
length of time sufficient to affect a change of title as a matter of
law. (see also: Sapto vs Fabiano, 103 Phil 683; Bucton vs
Gabar, 55 SCRA 499; Dignos vs CA, 158 SCRA 375; Coronel vs
IAC, 155 SCRA 270; Solid State vs CA, 196 SCRA 630)
CO-OWNERSHIP
Art. 484. There is co-ownership whenever the ownership of
an undivided thing or right belongs to different persons.
In default of contracts, or of special provisions, co-
ownership shall be governed by the provisions of this title.
Note: Under this article, co-ownership may exist as to rights, and
is not limited to corporeal things. (see: Samaniego vs. Villajin
C.A OG 3137)
In Javier vs. Javier, 5 Phil 78, when a house is owned by
one person, and the lot by another, there is no co-ownership
created over the properties.
Characteristics: (Co-ownership may also be referred to as
Tenancy in common)
1. Plurality of subjects;
2. Singularity or unity of object;
3. Recognition of ideal shares.
In de Guia vs. CA, 413 SCRA 114, the SC held that there is
no co-ownership when the different portions owned by different
people are already concretely determined and separately
identifiable even if not yet technically described.
 Page 13 of 13
Rules regarding ideal share:
§ Each co-owner has full ownership of his part, and of his
share in the fruits and benefits (Art. 493);
§ He may alienate, assign or mortgage his ideal share. (Art.
493);
What governs co-ownership?
a. Contracts; in default thereof:
b. Special legal provisions;
c. The law on co-ownership.
Sources of co-ownership:
¬ LAW - party walls; party ditches; intestate succession;
properties acquired by a man and a woman whose
marriage is void;
¬ CONTRACT - two persons buy a parcel of land sharing in
the purchase price and agree not to divide the land for ten
years;
¬ CHANCE - commixtion, confusion, hidden treasure;
¬ WILL - when two persons are named as legatees or
devisees of an undivided thing;
¬ OCCUPATION - Punzalan vs. Boon Liat, 44 Phil 320,
when a wild beast is caught by several persons.
Rules on the shares of co-owners in the benefits and
charges (Art. 485):
a. The share in the benefits and charges is proportional to
the interest of each. Hence, if one co-owner owns 2/3,
he shares 2/3 of the taxes;
b. Contrary stipulation is VOID. To do so would be to run
against the nature of co-ownership;
c. Each co-owner shares proportionately in the accretion
or alluvium of the property. This is because an
increase in area benefits all.
LIMITATIONS on co-owner’s right to use the thing owned in
common (Art. 486):
a. Can be used only according to the purpose for which it
was intended;
To determine the purpose for which the property is
intended, the agreement of the co-owners (express or
implied) should govern. In default of any agreement: (1) that
to which the thing is ordinarily adapted according to its
nature or; (2) the use to which it has been previously
devoted.
Thus, if the co-owners of a vessel agree that it shall be
used as a warehouse or storage place for grain, one of the
co-owners cannot order the grain removed and use the
vessel for maritime transportation. Mere tolerance on the
part of the co-owners cannot legalize the change in the use
of the thing from that intended by the co-owners.
Prescription cannot be invoked to establish a right to such
different use, because mere tolerance cannot be the basis
of prescription.
In Aguilar vs. Court of Appeals, 227 SCRA 472, it
was held that being a co-owner respondent has the right to
Marianne Macayra
use the house and lot without paying any compensation to
the petitioner, as he may use the property owned in
common so long as it is in accordance with the purpose for
which it is intended and in a manner not injurious to the
interest of the other co-owners.
Each co-owner of property held pro indiviso exercises
his rights over the whole property and may use and enjoy
the same with no other limitation than that he shall not injure
the interest of his co-owners, the reason being that until a
division is made, the respective share of each cannot be
determined and every co-owner exercises, together with his
co-participants joint-ownership over the pro indiviso
property, in addition to his use and enjoyment of the same.
b. The right to use must not prejudice the interest of the
co-ownership;
A co-owner cannot devote community property to his
exclusive use to the prejudice of the co-ownership. Thus,
where the co-owners have agreed to lease a building owned
in common, a co-owner cannot retain it for his use without
paying the proper rent.
c. The right to use must not be exercised to prevent the
others from making use thereof according to their own
right.
The right of enjoyment by each co-owner is limited by a
similar right of others. Hence, if the thing is a dwelling
house, all the co-owners may live therein with their
respective families, to the extent possible. But if one co-
owner alone occupies the entire house without opposition of
the others, and there is no agreement to lease it, the other
co-owners cannot demand the payment of rents.
They can either exercise an equal right to live in the
house, or agree to lease it; if they fail to do so, they must
bear the consequences. It would be unjust to require the
co-owner to pay rents after the other co-owners by their
silence have allowed him to use the property.
Art. 491. None of the co-owners shall without the consent of
the others, make alterations in the thing owned in common,
even though benefits for all would result therefrom.
However, if the withholding of the consent by one or more of
the co-owners is clearly prejudicial to the common interest,
the courts may afford adequate relief.
Alteration is a change: which (a) is more or less permanent; (b)
changes the use of the thing; and (c) prejudices the condition of
the thing or its enjoyment by the others.
It is also a change (not limited to physical) of state of the
thing or the withdrawal of the use from that intended.
Example: sale; donation; or mortgage of the property.
In determining alterations, it is sometimes necessary to
consider the nature of the thing itself. Thus, when a thing does
not require any modification for its enjoyment, whatever
modifications or change that is made will be considered an
alteration. But when a thing in its nature requires changes, such
 Page 14 of 14
an industry or business, in its exploitation, such modifications and
variations should be considered as falling under acts of
administration.
REMINDERS:
§ Article 491 requires unanimity of consent, whether tacit or
express.
§ Effect of tacit consent - although the co-owner who is
deemed to have tacitly consented to the alteration cannot
ask for the demolition, neither can he be held liable to
answer for any part of the expenses incurred therein,
because the obligation to pay such expenses cannot be
deemed to be the subject of his tacit consent.
In PNB vs. CA, 98 SCRA 207 in rel. to Castro vs. Atienza,
53 SCRA 264, the SC said that the alienation of a common
property by a co-owner without the unanimous consent of all the
co-owners is void not because the nature of the thing had been
changed or altered, but because of the lack of unanimous
consent required by law – as acts of alienation such as sale,
donation, mortgage, lease for more than one year, etc. are acts
of ownership which could be exercised only by all. The
transaction is valid only with respect to the share of the co-owner
alienating.
What are the rights of a co-owner with regard to his ideal
share?
In Go Ong vs. CA, 154 SCRA 270, it was held that under
the provisions of Art. 493, the heirs as co-owners shall each have
the full ownership of his part and the fruits and benefits pertaining
to it. An heir may, therefore alienate, assign or mortgage it, and
even substitute another person in its enjoyment, except when
personal rights are involved. But the effect of alienation or
mortgage, with respect to the co-owners, shall be limited to the
portion which may be allotted to him in the division upon the
termination of the co-ownership. [see also: PNB vs. CA, 98
SCRA 207]
In Lopez vs. Ilustre, 5 Phil 576, it was held that what a co-
owner may dispose of is only his undivided share, which shall be
limited to the portion which may be allotted to him upon the
termination of the co-ownership. He has no right to divide the
property into parts and then convey one part by metes and
bounds.
Art. 494.
General Rule:
No co-owner shall be obliged to remain in the co-ownership.
Each co-owner may demand at any time the partition of the
thing owned in common, insofar as his share is concerned.
Reasons:
a. To avoid conflicts in management;
b. The law discourages co-ownership;
c. The disposition or enjoyment of the thing owned in
common is subject to the desire of all co-owners.
Exceptions:
When there exists a PROHIBITION, because:
Marianne Macayra
a. of the existence of an AGREEMENT between the
parties
• not more than 10 years, extendible by a new
agreement after the termination of the original
period; hence, no automatic renewal, otherwise, the
intention of the law would be defeated.
• If more than 10 years, void as to the excess;
• If prohibition is perpetual, valid only up to 10 years;
• If agreement is subject to a resolutory condition, the
agreement ends upon fulfillment of the condition
provided it does not exceed 10 years.
b. the LAW does not allow partition; (conjugal partnership
as a general rule);
c. of the WILL of the donor or testator; (the prohibition
may be up to 20 years);
d. the legal NATURE of the property does not allow
partition (i.e. automobile, partition shall proceed in
accordance with the rules set forth under Art. 498).
Note: As a general rule, prescription against a co-owner does
not lie.
In Aguilar vs. CA, 227 SCRA 472, in rel. to Salvador vs.
CA, 243 SCRA 239, the SC held that: Partition means the
segregation or division of a property in common to those to whom
it belongs in parts. A co-owner has the right to demand at
anytime the partition or segregation of his share in the thing
owned in common. The right to demand partition does not
prescribe as long as the co-ownership is recognized.
In order that the title may prescribe in favor of a co-owner,
the following requisites must concur: (Robles vs. Court of
Appeals, 328 SCRA 97)
1. The co-owner has performed unequivocal acts of
repudiation amounting to an ouster of the other co-
owners;
2. Such positive acts of repudiation have been made
known to the other co-owners;
3. The evidence thereof is clear and convincing.
In Robles vs. CA, the SC ruled that: Hilario did not have
possession of the subject property; neither did he exclude
petitioners from the use and enjoyment thereof, as they have
indisputably shared in its fruits. Likewise, his act of entering into
the mortgage contract with the bank cannot be construed to be a
repudiation of the co-ownership. As an absolute owner of his
undivided interest in the land, he had the right to alienate his
share, as he in fact did. Neither should his payment of land taxes
in his name, as agreed upon by the co-owners, be construed as
repudiation of the co-ownership. The assertion that the
declaration of the co-ownership was tantamount to repudiation
was belied by the continued occupation and possession of the
disputed property by the petitioners as owners.
Exception:
a. When a co-owner gives notice to the other co-owners
that he is repudiating the co-ownership and that he is
claiming ownership of the entire property;
 Page 15 of 15
b. The requirement of continuous, open, public, adverse
possession for the period of time required must be met;
Note:
Acts which may be considered adverse insofar as strangers
are concerned may not be considered adverse insofar as co-
owner is concerned. In other words, it is harder for a co-owner
acquire properties of strangers. Hence, mere actual possession
by one co-owner will not give rise to the inference that the
possession was adverse. This is because a co-owner is after all
entitled to possession of the property. There must indeed be a
definite repudiation and the possession is to the exclusion of
other co-owners.
In Salvador vs. CA, 243 SCRA 239, it was held that a mere
silent possession by a co-owner, his receipts of rents, fruits or
profits from the property, the erection of buildings and fences and
the planting of trees thereon, and the payment of land taxes,
cannot serve as proof of exclusive ownership, if it is not borne out
by clear and convincing evidence that he exercised acts of
possession which unequivocably constituted an ouster or
deprivation of the rights of the other co-owners.
Note: The period of prescription commences from the date of the
repudiation.
POSSESSION
Art. 523: Possession is the holding of a thing or the
enjoyment of a right.
What is the relationship between ownership and
possession?
As a general rule, possession is an element of ownership.
However, this is not absolute, there are circumstances whereby
the owner of the thing does not possess the thing.
Essential Requisites of Possession: (Must concur)
1. Holding, maybe actual or constructive, the body of
thing or the corpus. (There is occupancy, taking or
apprehension)
2. Intent to hold it, the animus or desire.
3. The possession must be by virtue of one’s own right.
Hence, an agent who holds is not truly in possession; it
is the principal who possesses thru the agent.
Classes of possession:
1. Possession is one’s own name or possession in the
name of another; (see Art. 524)
2. Possession in the concept of an owner or possession
in the concept of a holder; (see Art. 525)
3. Possession in good faith or possession in bad faith.
(See Art. 526)
What are the Degrees of Possession?
1. The mere holding of a thing without the title, or the
holding of a thing in violation of the rights of the owner.
Example: A thief possesses a thing without title and in
violation of the right of the owner.
Marianne Macayra
2. Possession with juridical title, but not that of ownership.
Example: Contract of lease; Usufruct; Possession by:
tenant; depository; bailee; or lessee. All these have
juridical titles but they are not the owners.
3. Possession with just title not sufficient to possess
ownership. (a.k.a. real possessory right.);
Example: “A” in good faith buys an automobile from “B”
who delivers the same to “A”, and who merely
pretended to be the owner thereof.
4. Possession with a title of dominium. This is possession
arising from ownership.
What are the concepts of possession?
Art. 525. The possession of things or rights may be had in
one of two concepts: either in the concept of owner, or in
that of the holder of the thing or right….
a. In the concept of an owner: It is the possession by
the owner himself or by a person who CLAIMS to be
and ACTS as the owner, whether he is in good faith or
in bad faith. He possesses the thing in such a way that
he makes people believe or see that he is the owner
and recognizes no title or ownership in another.
Possession in the concept of owner vs. Torrens title:
In Apostol vs. CA, 432 SCRA 351, the SC ruled that the
presumption of ownership granted by law to a possessor in the
concept of an owner under Art 541 is only prima-facie and cannot
prevail over a valid title registered under the Torrens System. It is
an accepted rule that a person who has a torrens title over the
property is entitled to the possession thereof.
In Occena vs. Esponilla, 431 SSCRA 116, the SC ruled
that the defense of indefeasibility of Torrens title does not extend
to a transferee who takes the certificate of title in bad faith with
notice of a flaw. A buyer of real property in the possession of
persons other than the seller must be wary and should
investigate the rights of those in possession otherwise he can
hardly be regarded as buyer in good faith and cannot have any
right over the property.
Prior possession, not necessary in a suit for unlawful
detainer
In a case for unlawful detainer, as when the new owner of
the house ejects the tenant therefrom, is prior physical
possession an indispensable requisite on the part of the new
owner?
In Apostol vs. CA, 432 SCRA 351, the SC ruled that “the
fact that the respondents were never in prior physical possession
of the subject land is of no moment, as prior physical possession
is necessary only in forcible entry cases.”
Distinction: Proof of possession in forcible entry and
unlawful detainer
In Pajuyo vs. CA, 430 SCRA 492, the SC held that: “Prior
possession is not always a condition sine qua non in ejectment.
This is one of the distinctions between forcible entry and unlawful
detainer. In forcible entry, the plaintiff is deprived of physical

possession of his land or building by means of force, threat,
strategy or stealth. Thus, he must allege and prove prior
possession. But in unlawful detainer, the defendant unlawfully
withholds possession after the expiration or termination of his
right to possess under any contract, express or implied. In such
case, prior physical possession is not required.
b. In the concept of holder: Here, the possessor
recognizes another to be the owner.
Examples: Tenant; Usufructuary; Depositary; Bailee
commodatum.
What is the nature of possession by a lessee?
In Maglucot-aw vs. Maglucot, 329 SCRA 78, it was held
that one who possesses as a mere holder acknowledges in
another a superior right which he believes to be ownership,
whether his belief is right or wrong.
In Jose M. T. Garcia vs. Court of Appeals, et al., G.R. No.
113140, August 10, 1999, the SC held that possessor who is
merely tolerated by owner is a possessor in the concept of holder
and such possession does not hinder a valid transfer of
ownership by the owner thru its sale to another.
In Servando Mangahas vs. Court of Appeals, G.R. No.
95815, March 10, 1999, it was ruled that there can be no
acquisitive prescription of land in favor of the possessor if the
possession is in the concept of holder.
In Sotera Paulino Marcelo, et al. vs. CA, G.R. No.
131803. April 14, 1999, the SC ruled: "Acquisitive prescription is
a mode of acquiring ownership by a possessor through the
requisite lapse of time. In order to ripen into ownership,
possession must be in the concept of an owner, public, peaceful
and uninterrupted.
Thus, mere possession with a juridical title, such as, to
exemplify, by a usufructuary, a trustee, a lessee, an agent for a
pledgee, not being in the concept of an owner, cannot ripen into
ownership by acquisitive prescription, unless the juridical relation
is first expressly repudiated and such repudiation has been
communicated to the other party.
Acts of possessory character executed due to license or by
mere tolerance of the owner would likewise be inadequate.
Possession, to constitute the foundation of a prescriptive right,
must be en concepto de dueno, or, to use the common law
equivalent of the term, that possession should be adverse; if not,
such possessory acts, no matter how long, do not start the
running of the period of prescription.”
POSSESSION IN GOOD FAITH AND POSSESSION IN BAD
FAITH
Art. 526. He is deemed a possessor in good faith who is not
aware that there exists in his title or mode of acquisition any
flaw which invalidates it. He is deemed a possessor in bad
faith who possesses in any case contrary to the foregoing.
Mistake upon a doubtful or difficult question of law may be
the basis of good faith.
AWARENESS of any FLAW is question of knowledge.
Marianne Macayra
Page 16 of 16
ü If he is not aware – GOOD FAITH. There is always a
presumption that every possessor is a possessor in
good faith. (see Art. 527)
ü If he is aware – BAD FAITH. This is purely personal to
the possessor. It may not necessarily be transmitted to
the heir.
In Sotera Paulino Marcelo, et. al. vs. CA, G.R. No.
131803, April 14, 1999, the SC ruled that transferee of an
in unregistered parcel of land for value from a buyer and who took
immediate possession thereof has the benefit of good faith in his
favor. Ordinary acquisitive prescription of 10 years is applicable.
In Republic vs. CA, 102 SCRA 331, it was held that a
party’s mere refusal to believe that a defect exists and his willful
closing of his eyes to the possibility of the existence of a defect in
his vendor’s title will not make him an innocent purchaser for
value if it afterwards develop that the title was in fact defective.
Hence, if circumstances exist that require a prudent man to
investigate; he will be in bad faith if he does not investigate.
[See: Leung Lee vs. Strong, 37 Phil. 464]
In Republic vs. De Guzman, 326 SCRA 267, the SC ruled
that the burden of proving the status of purchaser in good faith
and for value lies upon him who asserts that status. In
discharging the burden, it is not enough to invoke the ordinary
presumption of good faith. “The rule is settled that a buyer of real
property which is in possession of persons other than the seller
must be wary and should investigate the rights of who is in
possession. Otherwise, without such inquiry, the buyer can
hardly be regarded as buyer in good faith.”
ACQUISITION OF POSSESSION
Art. 531. Possession is acquired by the material occupation
of a thing or the exercise of a right, or by the fact that it is
subject to the action of our will, or by the proper acts and
legal formalities established for acquiring such right.
Three ways of acquiring possession:
1. Material occupation of the thing/exercise of a right.
¬ Holding, apprehension, arrest, occupancy.
Occupation is used here in its ordinary sense which
means holding of a thing which must be physical.
(Also the exercise of a right.)
2. By the action of our will. (By agreement)
¬ Here, there is no actual physical detention or seizure
of the thing but the agreement between the parties
constitutes the fact of possession.
3. Proper acts and legal formalities established by
law. This is the legal formality which gives rise to
possession.
¬ These are certain documents that can ordinarily give
rise to possession because of legal fiction. The
moment that document takes effect, automatically,
the person in whose favor that documents is
 Page 17 of 17
executed is deemed to have acquired possession of
that property.
In Medina vs. Greenfield Dev. Corp., the SC held that: “…
the execution of the deeds of conveyance is already deemed
equivalent to delivery of the property and prior physical
possession is not required. Possession is also transferred, along
with ownership thereof, by virtue of the notarized deeds of
conveyances. Under Art 1498 of the Civil Code, when the sale is
made through a public instrument, the execution thereof shall be
equivalent to delivery of the object of the contract.
• In donations, there is no need of delivery. The moment the
donation is in the form provided by law, the donee is deemed
to be in possession of the thing donated. Ownership is
automatically acquired by the donee.
• In wills, upon the death of the decedent if the will is valid, the
heirs mentioned in the will are deemed automatically, by fiction
of law to be in possession of the hereditary estate. Actually
and in truth, the heirs are not in actual possession but by
fiction of law, the possession by the decedent is deemed to be
continued without any interruption. Art. 533.
QUESTION: Who is the preferred possessor among
claimants? Can tax receipts and declarations be the basis of
claim of ownership through prescription?
A: In Cequeña vs. Bolante, 330 SCRA 216, it was held that
petitioners did not lose legal possession because possession
cannot be acquired through force or violence. For all intents and
purposes, a possessor even if physically ousted is still deemed
the legal possessor. Indeed, anyone who can prove prior
possession, regardless of its character, may recover such
possession.
The respondent is the preferred possessor because,
benefiting from her father’s tax declaration of the subject lot since
1926, she has been in possession thereof for a longer period. On
the other hand, petitioner’s father acquired joint possession only
in 1952.
Tax receipts and declarations of ownership, when coupled
with proof of actual possession of the property, can be the basis
of a claim for ownership through prescription. Respondent’s
possession was not disturbed until 1953 when the petitioner’s
father claimed the land. But by then, her possession, which was
in the concept of an owner – public, peaceful and uninterrupted –
had already ripened into ownership. Furthermore, she herself
after her father’s demise, declared and paid realty taxes for the
disputed land.
Tax declarations and receipts are not conclusive evidence
of ownership. At most, they constitute mere prima facie proof of
ownership or possession of the property for which taxes have
been paid. In the absence of actual, public and adverse
possession, the declaration of the for tax purposes does not
prove ownership.
The petitioners, despite 32 years of farming the subject
land, did not acquire ownership by mere occupation. Unless
coupled with the element of hostility toward the true owner,
occupation and use, however long, will not confer title by
prescription or adverse possession.
Marianne Macayra
In Republic vs. CA, 258 SCRA 712, the SC ruled that
although tax declarations or realty tax payments of property are
not conclusive evidence of ownership, nevertheless, they are
good indicia of possession in the concept of owner for no one in
his right mind would be paying taxes for a property that is not in
his actual or at least constructive possession.
They constitute at least proof that the holder has a claim of
title over the property. The voluntary declaration of a piece of
property and announces his adverse claim against the State and
all other interested parties, but also the intention to contribute
needed revenues for the government. Such an act strengthens
one’s bona fide claim of acquisition of ownership.
Who may acquire possession?
One who is in full possession of his civil capacity can
acquire possession of a thing or a right through any of the three
ways of acquiring possession as provided in Art. 531 (i.e.: [a]
material occupation of the thing; [b] by the action of our will; [c]
proper acts and legal formalities established by law.) or may
acquire (under Art. 432): [a] through his representative; [b] by his
agent; or [c] by any person without any power whatsoever
(negotiorum gestio)
Note: The possession of a person without power cannot be
acquired without the ratification of the person in whose name the
act of possession was executed.
QUESTION: May minors and incapacitated persons acquire
possession?
A: Minors and incapacitated persons may acquire possession in
those matters where they have capacity to act like in the case of
physical seizure of res nullius or donation of personalty
simultaneously delivered to them and not possession where
juridical acts are imperative like donations of realty where minors
and incapacitated persons have no juridical capacity to execute.
(see also: Art. 535.)
QUESTION: What are the circumstances that cannot give rise to
possession?
1. Force, violence, intimidation.
In Ayala de Roxas vs. Maglanso, 8 Phil 745 in rel. to Moreno
vs. Goco, 26 Phil 496, it was held that possession acquired by
force or violence does not affect possession because such
possession is not true possession respected by law. For all
purposes favorable to the true owner or possessor, his
possession is not considered interrupted.
In Bishop of Lipa vs. Mun. of San Jose, 27 Phil 571, it was
held that there is force or violence in the acquisition, even when
the property was not forcibly taken away from the owner, if the
intruder occupied it during the absence of the owner and commits
acts which repel the return of the owner.
2. Mere tolerance of the owner.
Concept – Acts merely tolerated are those allowed by the owner
not by reason of duty or obligation but by the impulse of sense of
neighborliness or good familiarity with persons.
In Municipality of Nueva Caceres vs. Director of Lands, 24
Phil 485 it was held that even assuming that these acts continue,
 Page 18 of 18
they do not affect possession. On the basis of these acts, no right
will be acquired by prescription.
In Estrella vs. Director of Lands, 106 Phil 911 in rel. to Yu vs.
de Lara, 116 Phil 1106, it was held that a person who occupied
another’s property at the latter’s tolerance without any contract
between them, is necessarily bound by an implied promise to
vacate it upon demand, falling in which ejectment suit is proper
against him.
3. Clandestine acts or secret possession. They cannot
give rise to possession, for possession must be open.
EFFECTS OF POSSESSION
Art. 539.
The right to be:
a. Respected in his possession;
b. Protected or restored to said possession by legal
means in case of disturbance of another;
Reasons for the rule – To:
a. prevent a positive attempt against public order;
b. avoid disturbances in the community;
c. prevent deprivation of property without due process of
law;
d. avoid taking into his own hands the administration of
justice.
Remedies:
1. Action for forcible entry – the unlawful deprivation of
possession by means of force, intimidation, stealth,
threat or strategy. Here, the dispossession arises from
a situation or condition under which a person can
wrongfully enter upon a real property and exclude
another, who has had possession, therefrom.
2. Unlawful detainer action
3. Accion publiciana – where the cause of action arose
more than one year prior to the filing of the complaint to
recover possession of real property, and therefore the
action for forcible entry and detainer can no longer be
instituted. The issue here is who has the better right of
possession?
PRESUMPTION OF OWNERSHIP
Art. 541. A possessor in the concept of an owner has in his
favor the legal presumption that he possesses with a just
title and he cannot be obliged to show or prove it.
What does it mean by “he possesses with a just title and he
cannot be obliged to show or prove it”?
In Chan vs. CA, 33 SCRA 737, the clause “he possesses
with a just title and he cannot be obliged to show or prove it”
means that, the possessor cannot be inquired about his
ownership without any valid reason, for he is presumed to be the
Marianne Macayra
owner thereof. Anyone who claims to be the true owner must
resort to judicial process for the recovery of the property.
Note: The term “just little” refers to true and valid title – a title
which by itself is sufficient to transfer ownership without the
necessity of letting the period elapse. (see: Diolente vs.
Biarnessa, 7 Philippines 232)
Example: “B” brought a car from “S”, the owner thereof. Then “S”
delivered the car to “B”. “B” now has a valid and true title over the
car. Thus, if “B” possesses and drives the car around as an
owner, other people cannot compel him to prove ownership
thereof.
Note: For purposes of prescription, “just title” means colorable
title – that title where, although there was a mode of transferring
ownership, still something is wrong, because the grantor is not
the owner of the thing.
Example: In the above example, if it turn out that “S” is not the
owner of the car and somebody else was its owner, “B” would not
be considered as the owner thereof because he did not acquire it
from the owner of the car, irrespective whether or not he is in
good faith. However, for purposes of prescription, his possession
is just considered as “just title” of the period required by law
depending on whether he is in good faith or not. Of in good faith
– 4 years ( personal property); in bad faith - 8 years.
Reasons for the presumption:
1. A possessor is always presumed to be in good faith.
2. Because of the inconvenience of carrying proofs of
ownership around.
Requisites in order that the principle “Possession is
presumed ownership” to apply:
1. One must be in possession, actual or constructive;
2. The possession must be in the concept of an owner,
not mere holder; (see: Art. 540)
Art. 544. A possessor in good faith is entitled to the fruits
received before the possession is legally interrupted.
Natural and industrial fruits are considered received
from the time they are gathered or severed.
Civil fruits are deemed to accrue daily and belong to the
possessor in good faith in that proportion.
Applicability of the article: The article applies to fruits only. It
cannot extend to other things like the dismantled materials from a
demolished house, part of the hidden treasure pertaining to the
owner of the land.
Who are the possessors entitled to the fruits?
Only possessors in good faith are entitled to fruits.
Possessors in bad faith on the other hand are not entitled to fruits
but even required to reimburse the fruits already received and to
some extent damages.
In Calma vs. Calma, 56 Phil 102, during the time the
possessor is considered in good faith, he is entitled to the fruits
he had received out of the property he is possessing. From the
moment his good faith had been converted into bad faith – such
 Page 19 of 19
as by judicial summons or extraneous evidence, he loses that
right to retain the fruits.
In Mindanao Academy, Inc. vs. Yap, 121 Phil. 204, before
legal interruption, the fruits received by the possessor in good
faith belong to him. But after judicial summons had been served
upon the possessor in good faith, his right to get the fruits not yet
gathered terminates.
Notes:
§ Natural fruits are the spontaneous products of the soil, and
the young and other products of animals;
§ Industrial fruits are those produced by lands of any kind
through cultivation or labor.
§ Civil fruits are the fruits of buildings, the price of leases of
lands, and other property and the amount of perpetual or life
annuities or other similar income.
When are fruits considered gathered?
¬ Natural and industrial fruits – the moment they are
gathered or severed.
¬ Civil fruits – deemed received on their due date not actual
payment.
Illustration: “A” purchased an apartment from “B” in good faith.
“A” leased the apartment to “C” who paid an advance rentals for
1 year in the total sum of PhP120,000.00 at the rate of
PhP10,000.00 per month. Six months after “A” had leased the
apartment, he received judicial summons. He lost the case to the
plaintiff who was able to prove his superior right to the apartment.
Under the law, “A” must return the rentals due the months
after he received the judicial summons. He must therefore return
PhP60,000.00 to the true owner, retaining at the same time the
other PhP60,000.00
QUESTION: What is the liability of possessor in bad faith
regarding fruits?
a. As to fruits already received – return them is still
existing or pay for their value if already spent;
b. As to growing, pending or ungathered fruits – no rights
whatsoever.
In Director vs. Abagat 53 Phil 147, in rel. to Lerma vs. dela
Cruz, 7 Phil. 581, as additional liability, he must render an
accounting of the fruits he had received as well as the fruits he
could have received. He is also liable to pay for damages which
must be equivalent of the reasonable rent for the occupation of
the property during the period of his possession in bad faith.
Note: In MWSS vs. CA, 143 SCRA 623, the right of removal
granted to a possessor in bad faith applies only to improvements
for pure luxury or mere pleasure.
Rule on necessary and useful expenses: [see Art. 546]
1. Necessary expenses are those incurred to preserve
the property without which, the said property will
physically deteriorate or be lost.
Marianne Macayra
Examples: Major repairs of a house [Angeles vs Lozada, 54
Phil 185]; expenses for cultivation, production and upkeep of the
property. [See: Mendoza vs. de Guzman, 52 Phil 104]
Rule: Every possessor is entitled to a refund whether in good
faith or bad faith, except that the possessor in good faith is
entitled to right of retention of the property until the refund is
made.
2. Useful expenses – those incurred to add value to the
property or increase productivity of the property.
Examples: Construction of dining room, kitchen, closet and
bathroom [Robles vs. Lizarraga Hermanos, 42 Phil. 584;
construction of irrigation system [Valenzuela vs. Lopez, 51 Phil.
279]; construction of artificial fishponds [Rivera vs Archbishop
of Manila, 40 Phil 717].
Rule: Refundable only to possessors in good faith with the same
right of retention as in necessary expenses.
Note: The possessor in good faith may remove the useful
improvements he had introduced provided that no substantial
injury or damage would be caused to the principal thing. In
Javier vs. Concepcion, 94 SCRA 212, the right to remove
useful improvements is subject to the right of the owner to keep
the improvements himself by paying the expenses incurred or the
concomitant increase in value of the property caused by the
improvements. In other words, the possessor’s right of removal is
subordinate to the right of the owner to retain said improvements
[Calagan vs. CFI, 95 SCRA 498].
3. Expenses for luxury – those incurred to cater to the
personal comfort, convenience or enjoyment of the
possessor.
Rule: They are not refundable. The rationale behind this denial is
that the law does not compensate personal whims and caprices.
These improvements are purely for embellishments and not for
preservation of the property, or for increasing the value or
productivity of the property.
Examples: Paintings of murals on concrete fence; scenic
painting placed in the wall of bathroom.
RULE ON IRREIVINDICABILITY
Art. 559. The possession of movable property acquired in
good faith is equivalent to title. Nevertheless, one who has
lost any movable or has been unlawfully deprived thereof
may recover it from the person in possession of the same. If
the possessor of a movable lost or of which the owner has
been unlawfully deprived, has acquired in good faith at a
public sale, the owner cannot obtain its return without
reimbursing the price paid therefore.
Acquired in good faith here means the possessor is of the
belief that the person from whom he received the thing was its
owner and could transfer valid title thereto.
Requisites for title:
1. That the possession is in good faith;
 Page 20 of 20
2. That the owner has voluntarily parted with the
possession of the thing;
3. That the possession is in the concept of an owner.
Note: Under this situation, if the (real) owner gets the thing, he
must REIMBURSE.
Exceptions to the rule: [Note: Here, there is NO
REIMBURSEMENT.]
1. When the owner has lost the thing;
2. When the owner has been unlawfully deprived of the
thing;
Exception to the exception: When the possessor had acquired
the thing in good faith at a public sale (public auction sale).
[Note: Here, the owner of the thing shall REIMBURSE the price
paid.]
Instances where there could be NO RECOVERY even if
owner offers reimbursement:
1. If possessor acquired the thing in good faith by
purchase from a MERCHANT STORE or in FAIRS or in
MARKETS, in accordance with the code of
COMMERCE of special laws (see Art. 1505, NCC and
Art 85 of the Code of Commerce);
2. If owner is by his own conduct precluded from denying
the seller’s authority to sell (Estoppel); see: Art. 1505,
NCC;
3. Holders in due course; Art. 1518, NCC;
4. Finders of lost article after lapse of six (6) months; Art.
719, NCC;
5. Acquisitive prescription; Art. 1132, NCC (good faith – 4
years; bad faith – 8 years).
UNLAWFULLY DEPRIVED
EDCA Publishing vs. Santos, 184 SCRA 614
FACTS: On October 5, 1981, a person identifying himself as
Prof. Jose Cruz of De la Salle College placed an order via
telephone for 406 pcs of books with EDCA Publishing payable on
delivery (COD). EDCA prepared the corresponding invoice and
delivered the books as ordered, for which Cruz issued a personal
check covering the purchase price of P8,995.65. On October 7,
1981, Cruz sold 120 pcs of the books to Leonor Santos who,
after verifying the seller’s ownership from the invoice Cruz
showed her, paid him P1,700.00.
Meanwhile, EDCA having become suspicious over a second
order placed by Cruz even before clearing of his first check,
made inquiries with Della Sale College where he had claimed to
be dean and was informed that there was no such person in its
employ. Further verification revealed that Cruz had no more
account or deposit with the Philippine Amanah Bank, against
which he had drawn the payment check. EDCA then went to the
police, which set a trap and arrested Cruz on October 7, 1981.
On the night of the same date, EDCA sought the assistance
of the police which forced their way into the store of Santos and
threatened her with prosecution for buying stolen property. They
seized the 120 books without warrant, loading them in a van
belonging to EDCA, and thereafter, turned them over to EDCA.
Marianne Macayra
Santos sued for the recovery of the books. EDCA contended
that it can recover the books from Santos considering that EDCA
was unlawfully deprived thereof since the check issued by the
impostor was dishonored thus, nullifying the contract of sale
between it and the impostor.
HELD: Art. 1477 of the Civil Code provides that the ownership of
the thing sold shall be transferred to the vendee upon the actual
or constructive delivery thereof. Art. 1478 also provides that the
parties may stipulate that ownership in the thing shall not pass to
the purchaser until he has fully paid the price.
It is clear from the above provisions, particularly Art. 1478
that ownership in the thing sold shall not pass to the buyer until
full payment of the purchase price only if there is a stipulation to
that effect. Otherwise, the rule is that such ownership shall pass
from the vendor to the vendee upon the actual or constructive
delivery of the thing sold even if the purchase price has not yet
been paid. Non-payment creates a right to demand payment or
to rescind the contract, or to criminal prosecution in the case of
bouncing checks. But absent the stipulation above noted,
delivery of the thing sold will effectively transfer ownership to the
buyer who can in turn transfer it to another.
In Tagactac vs. Jimenez, the plaintiff sold the car to Feist,
who sold it to Sanchez, who sold it to Jimenez, when the
payment check issued to Tagactac by Feist was dishonored, the
plaintiff sued to recover the vehicle from Jimenez on the ground
that she had been unlawfully deprived of it by reason of Feist’s
deception. In ruling for Jimenez, the Court of Appeals held:
“The point of inquiry is whether plaintiff-appellant Trinidad C.
Tagactac has been unlawfully deprived of her car. At first blush,
it would seem that she was unlawfully deprived thereof,
considering that she was induced to part with it by reason of the
chicanery practiced on her by Feist. Certainly, swindling, like
robbery, is an illegal method of deprivation of property. In a
manner of speaking, plaintiff-appellant was “illegally deprived” of
her car, for the way by which Feist induced her to part with it is
illegal and punishable by law. But does this “unlawful
deprivation” come within the scope of Art. 559 of the New Civil
Code?
The fraud and deceit practiced by Feist earmarks this sale
as a voidable contract (Art 1390 NCC). Being a voidable contract,
it is susceptible of either ratification or annulment. If the contract
is ratified, the action to annul it is extinguished (Art 1392, NCC)
and the contract is cleansed from all its defects (Art 1396, NCC);
if the contract is annulled, the contracting parties are restored to
their respective situations before the contract and mutual
restitution follows as a consequence (Art 1398, NCC).
However, as long as no action is taken by the party entitled,
either that of annulment or of ratification, the contract of sale
remains valid and binding. When plaintiff-appellant Tagactac
delivered the car to Feist by virtue of said voidable contract of
sale, the title to the car passed to Feist. Of course, the title that
Feist acquired was defective and voidable. Nevertheless, at the
time he sold the car to Felix Sanchez, his title thereto had not
been avoided and he therefore conferred good title on the latter;
provided he bought the car in good faith, for value and without
notice of the defect in Feist title (Art 1506, NCC)
 Page 21 of 21

The above rulings are sound doctrine and reflect our own could have acquired ownership or title to the subject matter
interpretation of Art. 559 as applied to the case before us. Actual thereof only by the delivery or tradition of the car to him. The car
delivery of the books having been made, Cruz acquired in question was never delivered to the vendee by the vendor as
ownership over the books which he could then validly transfer to to complete or consummate the transfer of ownership by virtue of
the private respondents. The fact that he had not yet paid for the contract. It should be recalled that while there was indeed a
them to EDCA was a matter between him and EDCA and did not contract of sale between Santos and Marella, the latter as the
impair the title acquired by the private respondents to the books. vendee, took possession of the subject matter thereof by stealing
the same while it was in the custody of the former’s son.
One may well imagine the adverse consequences if the
phrase “unlawfully deprived” were to be interpreted in the manner See: Cases
suggested by the petitioner. A person relying on the seller’s title
a. Del Rosario vs. Lucena, 8 Phil. 535
who buys a movable property from him would have to surrender
b. Varela vs. Finnick, 9 Phil 482
it to another person claiming to be the original owner who had not
c. Arenas vs. Raymundo, 19 Phil 46
yet been paid the purchase price therefor. The buyer in the
d. US vs. Sotelo, 28 Phil. 147
second sale would be left holding the bag, so to speak and would
be compelled to return the thing bought by him in good faith
without even the right to reimbursement of the amount he had
paid for it. USUFRUCT IN GENERAL

Aznar vs. Yapdiangco, 13 SCRA 486 Art. 562, Usufruct gives a right to enjoy the property of
another with the obligation of preserving its forms and
FACTS: Santos agreed to sell his car to Marella for P14,700.00, substance, unless the title constituting it or the law
the price to be paid after the car is registered in the name of otherwise provides.
Marella. After the execution of the Deed of Sale, Santos together
Marella proceeded to the Motor Vehicles Office where the CONCEPT: Usufruct – the right to enjoy the property of another,
registration of the car in Marella’s name was effected. When with the obligation of preserving its form and substance unless
Santos asked for payment, Marella told him that he was short of the title constituting it or the law provides otherwise.
P2,000.00 and informed him that he would get from his sister. Rights of Full Owner = DISPOSE + USE + FRUITS
Together they rode in the car to the supposed residence of his
sister. Upon entering the house, Marella told Santos to wait in FULL OWNERSHIP = Naked Ownership + Usufruct
the sala while he asked his sister for the money. Characteristics:
In the meanwhile, on the pretext that Marella had to show 1. Real right; Essential (Usufruct
his sister of the registration papers of the car, Santos gave them cannot exist
2. Temporary in nature;
to Marella, who thereupon entered the supposed room of his without these)
sister, ostensibly to show her the papers. That was the last time 3. Purpose is to enjoy the benefits;
Santos saw Marella and his car. In the meantime Marella 4. Obligation to conserve and preserve. - Natural
succeeded in selling the car to Aznar who bought the same in (Ordinarily present but may be eliminated by
good faith for P15,000.00. When Aznar was trying to register the agreement) and Accidental (may or may not be
car at the Motor Vehicles Office, the same was seized from him present depending upon the stipulation of the parties)
by the Philippine Constabulary as a consequence of the report
made to them by Santos. USUFRUCT, how created:
The lower court decided in favor of Santos applying the a. By law; (see Art. 225/226 of the Family Code, in re: Art.
provisions of Art 559 and concluded that he was “unlawfully 321 of the Civil Code.)
deprived” of his property. On appeal, Aznar contended that Art. Note: The property of an emancipated child is owned
1506 of the Civil Code and not Art 559 is applicable. Art 1506 exclusively by the child and shall be devoted solely for
provides: his support and education. As to the fruits or income of
“Art. 1506. Where the seller of goods has a voidable title the property, the rights of the parents over the same
thereto, but his title has not been voided at the time of the shall be limited only to the child’s support and collective
sale, the buyer acquired a good title to the goods, provided daily needs of the family.
he buys them in good faith, for value, and without notice of
b. By contract or agreement;
the seller’s defect or title.”
c. By last will and testament.
HELD: The contention is clearly unmeritorious. Under the afore-
quoted provision, it is essential that the seller should have a Rules governing usufruct:
voidable title at least. It is inapplicable where, as in this case, the a. Agreement; (or the title giving the usufruct)
seller had no title at all. b. Civil Code.
Marella did not have any title to the property under litigation
because the same was never delivered to him. He sought
ownership or acquisition of it by virtue of the contract. Marella

Marianne Macayra
 Page 22 of 22
RIGHTS OF THE USUFRUCTUARY
FIRST. The usufructuary shall be entitled to all the natural,
industrial and civil fruits of the property in usufruct. With respect
to hidden treasure which may be found on the land or tenement,
he shall be considered a stranger. (See: Art. 566)
Rules:
1. Pending natural or industrial fruits: growing at the time
the usufruct begins belongs to the usufructuary;
Here, the usufructuary has no obligation to refund for the
expenses but without prejudice to the right of third persons.
(Thus, if the fruits had been planted by a possessor in good faith,
the pending crop expenses and charges shall be pro-rated
between said possessor and the usufructuary) see: Art. 545,
NCC;
- those growing at the time the usufruct terminates, belong to
the naked owner. (See: Art. 567, NCC)
Here, the naked owner is obligated to reimburse the expenses
incurred for the ordinary cultivation and seeds and other similar
expenses from the proceeds of the fruits. (Hence, the excess of
expenses over the proceeds need not be reimbursed.)
2. Civil Fruits: (Rents, pensions, benefits, etc.) see: Art. 570,
NCC.
Rule: They shall be deemed to accrue proportionately to the
naked owner and usufructuary for the time the usufruct
lasts.
Example: A gave B in usufruct the profits of a certain building for
five (5) years.
a. If the usufruct lasts for the period stipulated, all the profits
during the said period will go to B.
b. Suppose however, B died at the end of three (3) years,
and the following were the profits from the building:
Yr. 1 - P10,000.00
Yr. 2 - P20,000.00
Yr. 3 - P30,000.00*
Yr. 4 - P20,000.00
Yr. 5 - P40,000.00
P120,000.00
Ratio is 3:2, thus: 3(P120,000.00)/5 = P72,000.00 – share of B;
2(P120,000.00)/5 = P48,000.00 – share of A.
QUESTION: What is the nature of dividends? Who shall be
entitled to them?
In Bachrach vs. Siefert, 87 Phil 483, dividends from shares in a
corporation are civil fruits whether in the form of cash or stock
dividends. They are not part of the capital, hence, they belong to
the usufructuary.
QUESTION: Are usufructuary rights exempt from execution?
In Vda. De Bogacki vs. Inserto, 111 SCRA 356, usufructuary
rights can be disposed of by the usufructuary, thus, he can
Marianne Macayra
transfer, assign, or alienate such rights. In the same vein, these
rights may be subjected to a writ of execution, not being exempt
therefrom.
SECOND. The usufructuary has the right to the enjoyment of:
a. Accessions (whether artificial or natural);
b. Servitudes and easements;
c. All benefits inherent in property (i.e.: the right to hunt
and fish therein, the right to construct rain water
receptacles) see: Art. 571, NCC;
THIRD. The usufructuary, in addition to the usufruct (as a right)
may: (see: Art. 572)
a. Enjoy the thing itself or thru another;
b. Lease the thing to another (for a period not longer than
that of the usufruct) even without the naked owner’s
consent;
c. Alienate, sell, donate, bequeath, or devise, sell or
pledge the usufructuary right (not the thing itself or
future crops, for crops pending at the termination of the
usufruct belong to the naked owner.)
FOURTH. The usufructruary has the right to MAKE USE of
things included in usufruct which gradually deteriorate without
being consumed, through wear and tear, in accordance with the
purpose for which they were intended. (a.k.a. Abnormal
Usufruct) see: Art. 573.
Examples: clothes, furniture, vehicles, books, etc.
Effect of the deterioration:
a. Because of normal use – the usufructuary is not liable. He
can return them in the conditions they might be in at the
termination of the usufruct. There is no necessity for him to
make any repairs to restore them to their former condition.
Although there is no express provision on the matter, if the
usufructuary does not return the things upon the expiration
of the usufruct, he shall pay an indemnity for the value of the
thing at the time such expiration.
b. Because of fortuitous event - usufructuary is obliged to
make the necessary and ordinary repairs (see art. 592). But
the mere deterioration thru normal use does not require the
ordinary repairs referred to under art. 592.
c. Because of fraud - the usufructuary is responsible. But
such liability make be set off against improvements. (see:
Art. 580);
FIFTH. The usufructuary has the right to MAKE USE of
consumable things in usufruct. (a.k.a. quasi-usufruct, see art.
574)
Note: (the principle of creditor-debtor relationship applies) Here,
the usufructuary becomes the owner of the things (consumable)
in usufruct, such as a sum of money or a quantity of liquid of
grain but he has the obligation to pay for their current price or
return the things of the same quantity and quality at the time
the usufruct ceases.
SIXTH. The usufructuary of fruit-bearing trees and shrubs has
the right to make use of the dead trunks, and even of those cut
 Page 23 of 23
off or uprooted by accident. (a.k.a. special usufruct) see: Art.
575.
Note: here, the usufructuary is obliged to replace with new plants.
SEVENTH. The usufructuary has the right to make:
a. Useful improvements;
b. Luxurious improvements for mere pleasure.
However:
1. He must not alter the form or substance of the properly
held in usufruct, unless the naked owner consents;
2. He is not entitled to a refund but either remove the
improvement if no substantial damage to the property
is caused (see Art 579); or to set off (compensate) the
improvements against damages for which he may be
liable (see: Art. 580). His right does not involve an
obligation, hence, if the usufructuary does not wish to
exercise it, he cannot be compelled by the naked
owner to remove his improvements. The option to
remove is granted to the usufructuary.
Rule in case of set off: (see. Art. 580)
a. If damage is greater than the improvement -
usufructuary is liable for the excess;
b. If improvement is greater than the damage - the naked
owner is not liable to refund the excess.
Rule: If a co-owner of a property gives the usufruct of his share
to another (see. Art. 582) the usufructuary takes the co-owner’s
place as to:
a. Administration or management;
b. Collection of fruits or interest (but not as to alienation,
disposition, or creation of any real right over the
property, since these are strict acts of ownership,
unless authorized by the naked owner.)
Effect of Partition: The usufructuary continues to have the
usufruct of the part allotted to the co-owner concerned.
Note: the co-owner may partition the property even without the
consent of the usufructuary and the partition is binding upon the
usufructuary. However, the naked owner (co-owner) must
respect the usufructuary.
OBLIGATIONS OF THE USUFRUCTUARY
The usufructuary has obligations:
a. Before the usufruct;
b. During the usufruct; and
c. After the usufruct.
Art. 583:
GENERAL RULE: The usufructuary BEFORE entering upon the
enjoyment of the property is OBLIGED:
1. To make after notice to the owner an INVENTORY of
all property which shall contain appraisal of the
Marianne Macayra
movables and description of the condition of the
immovables;
2. To give SECURITY, binding himself to fulfill the
obligations imposed upon him.
Note: The obligation to make inventory and to give security are
not necessary in order for the right to the usufruct begins but are
merely required before physical possession and enjoyment
of the property can be had.
EXCEPTION: Inventory is not required when:
1. No one will be injured thereby (as in the case of
usufruct over a periodical pension or incorporeal right
(see: Art. 570), provided the naked owner consents for
the law says “may” (see: Art. 585);
2. In case of waiver by the naked owner; or when there is
stipulation (in a will or contract).
Security is not required when:
1. No one will be injured thereby (as in the case of
usufruct over a periodical pension or incorporeal right
(see: Art. 570), provided the naked owner consents for
the law says “may” (see : Art. 585);
2. In case of waiver by the naked owner; or when there is
stipulation (in a will or contract).
3. When the usufructuary is the donor of the property
(who has reserved the usufruct). (The naked owner
should be grateful enough not to require the security.);
4. In cases of caucion juratoria (promise under oath), see:
Art. 587.
CAUTION JURATORIA
Art. 587. Caucion Juratoria – a sworn duty to take good care
of the property and return the same at the end of the
usufruct.
If a usufruct consists in:
1. Furnitures necessary for the use of the usufructuary;
2. House which his family may live;
3. Tools and implements and other movables necessary
for an industry or vocation which the usufructuary is
engaged, and the usufructuary cannot afford to give
the required security, he may file a petition before the
courts to allow him to enjoy possession of the said
properties in usufruct and swear under oath to take
good care and return them at the end of the usufruct.
RULE ON ORDINARY REPAIRS
Under Art. 592, the usufructuary is obliged to make the ordinary
repairs needed by the thing given in usufruct.
Note: These are repairs needed because of an event or an act
that endangers the preservation of the thing. (as distinguished
from deterioration under Art. 572).
 Page 24 of 24

Conditions for liability: Immovable, meaning of the term “immovable” must be construed
in its common and not legal sense. Hence it refers to
1. They are required by normal or natural use;
immovables by nature, such as lands, roads and buildings.
2. They are needed for preservation;
3. They must have occurred during the usufruct; Servient estate - is one which is burdened by a servitude;
4. They must have happened with our without the fault of
Dominant estate - is one that is benefited as a result of an
the usufructuary;
easement.
Note: If the naked owner had demanded the repair, and the
In Quimen vs. CA, 257 SCRA 163, an easement is a real right
usufructuary still fails to do so, the owner may make them
on another’s property, corporeal and immovable for the benefit of
personally or thru another at the expense of the usufructuary.
another immovable, whereby the owner of the latter must refrain
from doing or allow somebody else to do or something to be
done on his property, for the benefit of another person or
RULE ON EXTRA-ORDINARY REPAIRS
tenement. It is inseparable, indivisible and perpetual, unless
Art. 593. Extraordinary repairs shall be at the expense of the extinguished by causes provided by law.
owner. The usufructuary is obliged to notify the owner when
Characteristics of easement:
the need for such repairs is urgent.
1. It is a real right;
Rules governing the payment of debts of the naked owner if
the usufruct is a universal one (constituted on the whole of a 2. Imposable only against another’s property and never in
patrimony; and the naked owner has debts or is obliged to make one’s own property; it can exist only when the servient
periodical payments. estate and the dominant estate belong to two different
owners;
§ If there is stipulation to pay the debts of the naked owner, 3. It is a form of limitation on ownership and a restriction
apply Art. 758: on the enjoyment of one’s own property;
a. Pay only for prior debts and not for debts contracted 4. It is inseparable and indivisible; it cannot be separated
after the usufruct has been made, unless there is a from the tenement to which it belongs or divided even if
declaration to the contrary; there is division of the tenement; (see Arts. 617 & 618)
b. Pay only for debts up to the value of the property in 5. It is intransmissible (unless the tenement affected is
usufruct unless, the contrary is intended. also transmitted or alienated;
§ If there is no stipulation to pay the debts of the naked 6. It is perpetual unless extinguished.
owner, apply Art. 759: Inseparability – easements or servitudes are merely
a. As a rule, there is no obligation to pay; accessories to the tenements to which they are appurtenant.
They are inseparable, hence, intransmissible. They cannot be
b. The only exception is that when the usufruct was alienated separately from the tenements to which they pertain.
constituted in fraud of creditors. Thus, they cannot be alienated independently of the real property
“In fraud of creditor” – when at the time of the constitution of the to which they are attached.
usufruct, the naked owner did not reserve sufficient property to In Valisno vs. Adriano, 161 SCRA 398, the alienation of
pay his debts. This is presumed. tenements carries with it the alienation of the servitudes
QUESTION: May usufruct be constituted over a real property in pertaining to them.
favor of an alien? Indivisibility – Both dominant and servient estate may be
In Ramirez vs. Vda. De Ramirez, 111 SCRA 704, a usufruct divided between two or more persons. But the partition will not
over parcels of land made by a Filipino in favor of an Austrian modify the easement. Each of the servient owners shall bear the
woman is valid because ownership of the land is not vested in burden of the easement on the part corresponding to his share in
the usufructuary. What is proscribed by the Constitution is the immovable property.
ownership by an alien. Easements may also be:
1. According to the MANNER they are exercised or used:
EASEMENTS OR SERVITUDES a. CONTINUOUS easements - are those the use of
Easement is an encumbrance imposed upon an immovable for which is or may be INCESSANT (without any
the benefit of: interruption) or without the intervention of any act of
man;
a. Community;
personal easement Note: Here, for easement to be “continuous” the use
b. One or more persons;
does not have to be without interruption; it is enough
c. Another immovable belonging to a different owner (see
that it MAY BE incessant;
Art. 614) = real easement.
Note: The distinction between continuous and
discontinuous easements refers only to the exercise of
Marianne Macayra
 Page 25 of 25
the servitude, but not to the essence, because the
servitude exists continuously, whether it is being used
or not.
Examples:
Easements of drainage - the fact that water flows in it
signifies continuous use but the absence of any flow
does not make it non-continuous. It is enough that the
flow of water may be without interruption;
Easements of aqueduct - it is considered as
continuous (at least, for purposes of prescription) even
though the flow of water may not be continuous, or its
used depends upon the needs of the dominant estate,
or upon a schedule or alternate days or hours.
b. DISCONTINUOUS Easements - they are used at
intervals and depend upon the acts of man.
Example: Easement of right of way because it can be
exercised only if a man passes or puts his feet over
somebody else’s land.
2. According to whether or not their EXISTENCE is
indicated:
a. APPARENT Easement - those made known and
continually kept in view by external signs that reveal
the use and enjoyment of the same.
Note: The sign need not be seen but should be
susceptible of being seen.
Examples: Dam; Window in a party wall visible to both
owners; Right of way if there is an alley or a permanent
path.
b. NON-APPARENT Easements - they show no external
indication of their existence.
Examples: (in general, negative easements) Easement
of not building to a more than certain height; A right of
way if there is no visible path or alley.
3. According to PURPOSE of the easement or nature of
the limitation :
a. POSITIVE Easement - Here, the owner of the servient
estate is OBLIGED: (a.k.a servitude of sufferance) (a)
to allow something to be done on his property; or (b) to
do something himself on his property.
Example:
ü Easement of light and view on openings made on
a PARTY WALL.
If one opens a window on a party wall the other owner
may close it anytime. However, if he does not close it,
and the other owner acquires the easement by
prescription, the other owner can no longer close it.
Therefore the owner of the servient estate is allowing
something to be done on his property.
Note: Easement of light and view on a party wall.
Here, the owners of such wall permit the encumbrance
to burden their common wall.
Marianne Macayra
ü The owner of the servient estate has the duty to
cut off the branches of his tree extending over the
neighboring estate.
b. NEGATIVE Easements - Here, the owner of the
servient estate is prohibited to do something which he
could lawfully do were it not for the existence of the
easement. (a.k.a. servitude of limitation)
Example:
ü Easement of light and view on openings made on
one’s OWN WALL.
When a person makes an opening on his own wall to
admit light below the ceiling joist, and he acquires a
servitude to admit such light, the servitude is a negative
one, because: It imposes upon the owner of the
adjacent tenement the obligation not to construct on his
own land in such a manner as to obstruct the light.
How are easements established?
Art. 619. Easements are established either by law (legal
easements) or by the will of the owners (voluntary
easements).
Modes of acquiring easements:
Art. 620. Continuous and apparent easements are acquired
either by virtue of a title or by prescription of ten years.
a. Continuous and apparent easements (meaning they
are continuous and apparent at the same time) may be
acquired by :
¬ Title (Any kind of juridical act or law sufficient to
create the encumbrance i.e.: contract, donation,
testamentary succession.)
¬ Prescription (10 years whether in good faith or in bad
faith). Note: see Art. 1115 - general rules on
prescription are not applicable in cases of
prescription provided for by special or particular
provisions.
b. Discontinuous and apparent - only by title;
c. Continuous and apparent - only by title;
d. Discontinuous and non-apparent - only by title.
Rule (Art. 621) in order that continuous and apparent
easements may be acquired thru prescription:
a. If easement is POSITIVE:
¬ The period of prescription is counted from the day of
the dominant estate began to exercise it:
Example: A and B are neighbors and they own a party
wall. If A makes an opening or window in the party wall
in 1988, B can close it anytime before 1998. Because
if by the time the window is still open, A has already
acquired the easement of light and view by prescription
of 10 years, counted from the opening of the window.
Note: A window on a party wall is something allowed by
a co-owner to be done on his own property and may
 Page 26 of 26

therefore give rise to a positive easement of Obligations of the dominant estate:

sufferance.
¬ He cannot alter the easement (Art. 627);
b. If the easement is NEGATIVE:
¬ He cannot make it more burdensome (Art. 627);
¬ The period is counted from the date of NOTARIAL
ü Thus he cannot use the easement except for movable
PROHIBITION made upon the servient estate.
originally contemplated;
Example: “A” and “B” are neighbors. On his building's
ü In the easement of right of way, he cannot increase the
wall, “A” opened a window beneath the ceiling joist to
agreed width of the path, nor deposit soil or materials
admit light, in 1978. Even after ten years (1988), “B”
outside the boundaries agreed upon (for the acts would be
may still obstruct the light by constructing on his own
increasing the burden). But he may allow others to use the
lot a building higher than “A's” unless “A” makes a
path (this really does not increase the burden) except if the
notarial prohibition prohibiting “B” from making the
contrary has been stipulated. (see: Valderama vs. North
obstruction.
Negros Sugar Co., 48 Phil 492)
QUESTION: If in 1984, “A” makes a prohibition, may “B” still
ü If there be several dominant estates each must contribute
make the obstruction?
to necessary repairs and expenses in proportion to the
A: Yes, because, it is only in 1994 (ten years after the notarial benefits received by each estate (and not in proportion to
prohibition) when “A” may be said to have acquired the negative the value of each estate). In the absence of proof, the
easement of light and view. After 1994, “B” may no longer benefits are presumed to be equal.
obstruct.
Rights of the servient estate:
¬ To retain ownership and possession of the portion of his land
affected by the easement (Art. 630) even if indemnity for the
APPARENT SIGN OF EASEMENT
right is given (as in the case of easement of right of way) (Art.
Art.624. The existence of an apparent sign of easement 649), unless the contrary has been stipulated;
between two estates, established or maintained by the
¬ To make use of the easement, unless deprived by stipulation
owner or both, shall be considered, should either of them be
provided that the exercise of the easement is not adversely
alienated, as a title in order that the easement may continue
affected (Art. 630), and provided further that he contributes to
actively or passively, unless at the time the ownership of the
the expenses in proportion to the benefits received, unless
two estates is divided, the contrary should be provided in
there is a contrary stipulation (Art. 628, par. 2);
the title of the conveyance of either of them, or the sign
aforesaid should be removed before the execution of the ¬ To change the location of a very inconvenient easement
deed . This provision shall also apply in case of the division provided that an equally convenient substitute is made, without
of a thing owned in common by two or more persons. injury to the dominant estate. (Art. 629, part. 2)
Note: Article refers not to an existing sign but a sign of an Obligations of the servient estate:
existing easement. It is the servitude between the two tenements
¬ He cannot impair the use of the easement (Art. 629, par. 1)
which must exist and not the sign thereof.
¬ He must contribute to the expenses in case he uses the
Rights of the dominant estate:
easement, unless there is a contrary stipulation. (Art. 628, par.
¬ To exercise the easement and all necessary rights for its use 2);
including accessory easement (Art. 625);
¬ In case of impairment, to restore conditions to the status quo
¬ To make on the servient estate all works necessary for the use at his expense plus damages. (In case of obstruction, as
and preservation of the servitude, BUT: when he fences the original right of way, and offers an
inconvenient substitute way, which is farther and requires
1. This must be at his own expense;
turning at a sharp angle, he may be restrained by injunction.)
2. He must NOTIFY the servient owner;
See; Resolme vs. Lazo, 27 Phil. 416;
3. Select convenient time and manner;
4. He must not alter the easement nor render it more ¬ To pay for the expenses incurred for the change of location or
burdensome. from of the easement (in the proper case). See: Art. 629, par.
2
¬ To ask for a MANDATORY INJUNCTION to prevent
impairment or obstruction in the exercise of the easement as
when the owner of the servient estate obstructs the right of
way, building a wall or fence (see: Resolme vs. Lazo, 27 Phil MODES OF EXTINGUISHMENT OF EASEMENTS
416); Art. 631. Easements are extinguished:
¬ To RENOUNCE totally (for an easement is indivisible) if he 1. By MERGER:
desires exemption from the contribution to expenses (Art.
628); ¬ The merger must be absolute (without any condition),
complete (not partial) and not temporary. Thus, if the
Marianne Macayra
 Page 27 of 27

owner of the servient buys the whole portion affected, the
merger is complete, and the easement is extinguished.
But if the portion bought is not the portion affected, the
easement naturally remains.
Examples:
ü Temporary merger:
Q: The dominant owner sold a retro his estate to B, the
servient owner. Is the easement extinguished?
A: No, it is only suspended for the merger is only
temporary. It is revived when the property is
redeemed.
ü Conditional merger: The dominant estate was
donated to the servient estate, but it was stipulated that
if the servient owner later marries X, the property
reverts to the dominant owner. Pending the resolutory
condition, the merger is considered temporary, and the
easement is merely suspended. When the servient
owner marries X, the easement is revived. If no
marriage takes place (as when X dies) the easement
really is extinguished.
5. WAIVER or RENUNCIATION of the dominant estate:
¬ As a general rule, the renunciation must be express, clear
and specific (otherwise it may be confused with none-
user). However, it may be tacit for as long as there are
acts which clearly reveal it beyond doubt.
6. REDEMPTION agreed upon:
¬ This is voluntary redemption, existing because of a
stipulation. Stipulations may provide conditions under
which the easement would be extinguished.
7. OTHER causes:
a. Expropriation of the servient estate;
b. Annulment, recession or cancellation of the title that
constituted the easement;
c. Abandonment of the servient estate;
d. Resolution of the right of the granter to create the
easement (as when there is redemption of the property
sold a retro because of the exercise of the right of
conventional redemption);

2. By NON-USER for 10 years:

LEGAL EASEMENTS
¬ Non-user refers to an easement that has once been used
because one cannot discontinue using what one never Art. 634. Easements imposed by law have for their object
used. either public use or the interest of private persons.
¬ Non-user means voluntary abstention and not due to Legal easements - those imposed by law and which have for
fortuitous event, because the basis of this cause is their object either:
presumptive renunciation.
a. Public use - governed by special laws (i.e. Law on
Note: From what time to compute? Waters; Irrigation Law; Water Code);
a. Discontinuous - (like right of way) from the time it b. The interest of private persons - governed by the
ceased to be used. provisions of the Civil Code; agreement between the
b. Continuous - (like aqueduct) from the day on which an parties; general or local laws.
act contrary to the same took place. Thus the erection Different kinds of legal easements:
of works incompatible with the exercise of the
easement or totally obstructing the servitude, agreed to 1. Easement relating to:
by the owner of the dominant estate, amounts to a tacit ¬ waters - natural drainage of lands (Art. 637); natural
renunciation and extinguishes the servitude. (see: drainage of buildings (Art. 674); easement on riparian
Ongsiako vs. Ongsiako, 3-30-57) banks for navigation;
3. By IMPOSSIBILITY OF USE or BAD CONDITION of the ¬ floatage and salvage (Art. 638) - easement of a dam
tenement: (Arts. 639, 647); easement for drawing water or for
¬ The impossibility of using the easement, which arises watering animals (Arts. 640-641); easement of aqueduct
from the condition of the tenements, only suspends the (Arts. 643-646); easement for the construction of a stop
servitude, until such time when it can be used again. An lock or sluice gate.
example of this would be the flooding of the servient 2. Right of way;
tenement over which a right of way exists. Unless,
extinguishment is caused by the necessary period for 3. Party wall;
non-user. 4. Light and view;
4. By EXPIRATION of the term or FULFILLMENT of the 5. Drainage;
condition:
6. Intermediate distance;
¬ Example: An easement was agreed upon to last till the
owner of the dominant estate becomes a lawyer. When 7. Easement against nuisance;
the condition is fulfilled the easement is extinguished. 8. Lateral and subjacent support.

Marianne Macayra
 Page 28 of 28
EASEMENT OF RIGHT OF WAY
Art. 649. Easement of right of way.
Definition: the easement or privilege by which one person or a
particular class of persons is allowed to pass over another's land,
usually through one particular path or line. The term right of
way may either refer to the easement itself or the strip of land
over which passage can be done.
Requisites:
a. The property is surrounded by the estates of others;
b. There is no adequate outlet to a public highway. (If outlet is
thru the water, like a river or sea, under Spanish law, the
easement cannot be demanded for there exists an adequate
outlet; it is believed that in Philippines, a distinction must be
made, depending on danger, convenience and cost.);
c. There must be payment of proper indemnity, (but later on,
the amount may be refunded when easement ends, see:
Art. 655);
d. It must be established at a point least prejudicial to the
servient estate. (This is generally but not necessarily the
shortest distance);
e. The isolation must not be due to the proprietor's own acts
(as when he has built enclosing walls, see : Art. 649);
f. Demandable only by the owner or one with a real right like a
usufructuary. (The lessee should ask the lessor to demand
the easement from adjoining estates.)
Note: The onus or the burden of proof is upon the owner of the
dominant estate to show the specific averments in his complaint
the existence of the requisites or preconditions enumerated.
QUESTION: Can there be judicial easement?
In La Vista Association vs. CA, 278 SCRA 498, when the court
says that an easement exists, it is not creating one. For even an
injunction cannot be used to create one as there is no such thing
as judicial easement. The court merely declares the existence of
an easement created by the parties.
NUISANCE
Why is nuisance a modification of ownership?
Because if one’s property becomes a nuisance, he can be
deprived of its enjoyment and even be deprived of its ownership.
So, if a house is about to collapse and may cause injury to
others, the owner can be compelled to demolish the house.
NUISANCE, defined:
Art. 694 provides: A nuisance is any act, omission,
establishment, condition of property, or anything else which:
1. Injures or endangers the health or safety of the others.
(ex: House in danger of falling; explosive factory in a
residential area.
Marianne Macayra
2. Annoys or offends the senses. (ex: Too much noise or
horn blowing; a chimney which renders a house
uninhabitable due to excessive smoke)
3. Shocks, defies or disregards decency or morality. (ex:
Public exhibition of a naked person; strip-teasing;
public display of nude posters.)
Note: The standard of morality changes. So that what
was immoral 20 years ago may not be immoral today.
The third instance then depends on time, place and
standard of morality of countries and people.
4. Obstructs or interferes with the free passage of any
public highway or streets, or any body of water. (ex:
houses erected on public streets)
5. Hinders or impairs the use of property. (ex: Illegal
constructions on another’s land)
What are the different kinds of nuisance?
1. Public or private nuisance (Art. 695):
¬ Public nuisance – the doing of or the failure to do
something that injuriously affects safety, health or
morals of the public, or works some substantial
annoyance, inconvenience or injury to the public. It
affects a community or neighborhood or any
considerable number of person although the extent
of the annoyance, danger or damage upon
individuals may be unequal.
¬ Private nuisance – One which violates only private
rights and produces damage to but one or few
persons and cannot be said to be public.
2. Nuisance per se or nuisance per accidens:
¬ Nuisance per se – a nuisance at all times and under
all circumstances or conditions.
¬ Nuisance per accidens - a nuisance only under
certain circumstances or conditions.
3. Attractive nuisance – This is any contrivance which is
very attractive to children but very dangerous to them.
REMINDER:
• An attractive nuisance is not illegal. It may be legal or
legitimate thing but because of its nature, it can easily injure
children, that is why it is called attractive nuisance.
Example: firearms.
• If one is an owner of an attractive nuisance, he is required to
exercise the highest degree of diligence to prevent it from
being played by children.
Hidalgo Enterprises vs. Balandan 91 Phil. 488
FACTS: A certain ice-plant factory maintained two big tanks full
of water in a place where children pass by. A boy 8 years of age
passed by and entered the premises of the factory and took a
bath in one of the tanks. While swimming, the boy drowned and
died. The parents of the boy filed an action for damages against
the factory alleging that the tank full of water was an attractive
 Page 29 of 29

nuisance and yet the factory did not provide any precaution to b. CIVIL ACTION;
avoid injury.
c. EXTRA-JUDICIAL ABATEMENT (abatement, without
The following issues were raised: judicial proceedings. (Art. 699);
1. Whether or not water can be considered an attractive Note: Remedy (b) and (c) above may be brought by
nuisance. any private individual if the nuisance is specially injurious to
himself.
The SC held that water in any form is not an attractive
nuisance. Nature in itself has created streams, lakes, ¬ If it is a PRIVATE NUISANCE, there are 2 possible
and pools which attract children. Lurking in their remedies:
waters is always the danger of drowning. Against this
a. Civil action; or
danger, children are to know the danger.
b. Abatement, without judicial proceedings (Art. 705)
2. Whether on not the tank full of water is an attractive
nuisance? QUESTION: What are the requisites for the abatement of
nuisance, whether public or private, without judicial proceedings?
It is neither an attractive nuisance. Any imitation of
(Art. 703 and 704)
nature, like a swimming pool, is not an attractive
nuisance. So, if the owner of a private property creates ANSWER:
an artificial pool on his own property, merely duplicating
a. There must be showing that the nuisance is specially
the work of nature without adding any new danger, he
injurious to the person seeking the abatement of
is not liable.
nuisance; (Art. 703)
Who can be liable for damages for the nuisance cause? b. That demand be first made upon the owner or
The owner or possessor who originally caused the nuisance and possessor of the property to abate the nuisance;
the subsequent owner or possessor of the property are jointly c. That such demand has been rejected or ignored;
and severally liable. (Art. 696: Every successive owner or d. That the abatement must be approved by the City
possessor of property who fails or refuses to abate a nuisance in Engineer in Manila and other chartered cities, and in
that property started by a former owner or possessor is liable the provinces, by the Provincial Health Officer and
therefore in the same manner as the one who created it.) executed with the assistance of or attended by a
Who are liable? member of the local police force;
e. That the abatement must be done in such a way that it
In general:
does not breach public peace, or do unnecessary
a. One who creates; injury;
b. All who participates; f. That the value of the thing to be abated does not
c. One who adopts; exceed P3,000.
d. One who continues a previously existing nuisance;
e. One who refuses to abate nuisance. Note:
If a property which has already caused nuisance is removed, ¬ Criminal prosecution is not mentioned. However, if a crime
is it a defense? has been committed as defined in the Revised Penal Code,
criminal prosecution can proceed.
A: Art. 697: NO, the abatement of a nuisance does not preclude
the right of any person injured to recover damages for its past ¬ If the nuisance to be abated is more than P3,000.00 it
existence. cannot be abated without judicial proceedings. It can be
abated only through a criminal or civil action in court as the
May an action for abatement of a nuisance prescribe? case may be.
A: NO, an action for abatement of a nuisance is one which is When may a private person or a public officer extra judicially
imprescriptible. A nuisance can be abated anytime. Art. 698: abating a nuisance be liable for damages?
Lapse of time cannot be legalize any nuisance whether public or
private. Art. 1143, 2nd par, an action to abate a public or private Art. 707:
nuisance is not extinguished by prescription: 1. If he causes unnecessary injury; or
What are the remedies against a nuisance? 2. If an alleged nuisance is later declared by the courts to
be not a real nuisance.
A: It depends on whether it is a public or private nuisance.
Cases:
¬ If it is a PUBLIC NUISANCE, there are 3 possible
remedies: a. Pp vs. de Guzman, et. al., 90 Phil. 132
b. Espiritu vs. Municipal Council, 102 Phil 867
a. CRIMINAL PROSECUTION under the Penal Code or c. Iloilo Cold Storage vs. Mun. Council, 24 Phil. 471
any local ordinance [Note: This remedy is instituted by d. Canlas vs. de Aquino, 2 SCRA 814
public officers (ordinarily the mayor)]; e. San Rafael vs. City of Manila, 46 SCRA 40
Marianne Macayra
 Page 30 of 30
f. Velasco vs. Manila Electric, 40 SCRA 342
g. Ramcar vs. Millar, 6 SCRA 517
DIFFERENT MODES OF ACQUIRING OWNERSHIP
Modes of acquiring ownership:
a. ORIGINAL MODE: (Ownership is acquired for the first time)
1. Occupation (hunting, fishing, hidden treasure);
2. Intellectual Creation (books, copy rights, patents,
letters);
b. DERIVATIVE MODE: (There is merely a transfer of
ownership; somebody else was the owner before)
3. Succession;
4. Donation;
5. Prescription (Art. 1106);
6. Law (Arts. 158, 445, 461, 465, 466, 681, 1434, 1456 –
NCC);
7. Tradition (meaning: legal delivery actual/constructive)
as a consequence of certain contracts (i.e.: sale,
barter, assignment, simple loan or mutuum)
MODE - the process of acquiring or transferring ownership.
TITLE - that which is not ordinarily sufficient to convey
ownership, but which gives a juridical justification for a mode; that
is, it provides the cause for the acquisition of ownership.
Example: If “A” sells to “B” a specific car for a specific amount,
the sale is the title; by virtue of such title, “A” should now deliver
the property to “B”. It is the delivery or tradition that makes “B”
the owner; it is the tradition that is the mode.
OCCUPATION
Art. 713. Occupation is the acquisition of ownership by
SEIZING corporeal things that have no owner, made with the
intention of acquiring them, and accomplished according to
legal rules.
Occupation distinguished from possession:
¬ Occupation can take place only with respect to property
without an owner; while possession can refer to all kinds of
property whether with or without an ownership.
¬ Occupation, in itself when proper confers ownership; but
possession does not by itself give rise to ownership.
Requisites for occupation:
1. There must be a seizure of apprehension (note: the
material holding is not required as long as there is right
of disposition);
2. The property seized must be corporeal (personal)
property;
Marianne Macayra
3. The property seized must be susceptible of
appropriation (either unowned or abandoned property);
4. There must be intent to appropriate;
5. The requisites or conditions of the law must be
complied with (i.e.: good faith; proper title; legal period
of time).
Art. 714. The ownership of a piece of land cannot be
acquired by occupation.
Reasons: Because a land that is not shown to belong to anyone
is presumed to be a public land;
- Occupation as a mode of acquiring ownership refers to
movables which are either considered as res nullius or res
derelicta.
INTELLECTUAL CREATION
Intellectual Creation is the product of mental labor embodied in
writing or some other material form.
Art. 721. By intellectual creation, the following persons
acquire ownership:
¬ The author with regard to his literary, dramatic, historical,
legal, philosophical, scientific or other work.
¬ The composer, as to his musical composition.
¬ The painter, sculptor, or other artist, with respect to the
product of his art.
¬ The scientist or technologist or any other person with regard
to his discovery or invention.
Art 722.
¬ Ownership before publication – exclusive;
¬ Ownership after publication – no more exclusive right
except when work is copyrighted.
Note: Mere circulation among close friends and associates
however, is not considered publication.
Art. 723. Letters and other communications in writing are
owned by the person to whom they are addressed and
delivered, but they cannot be published or disseminated
without the consent of the writer or his heirs. However the
court may authorize their publication or dissemination if the
public good or the interest of justice so requires.
Rules:
• The physical or material object is owned by the person to
whom it has been sent.
• The thoughts, ideas and form of expression contained in the
letter belong to the sender or author of the letter.
• The recipient cannot publish or disseminate the letter, unless:
a. The writer or the writer’s heirs consent;
b. The public good or the interest of justice so requires as
when the:
 Page 31 of 31
• The publication is necessary for the vindication of the
character of the person to whom the letter is addressed.
• The letter is produced as evidence in court, in the course of
the administration of justice, except when the letter constitutes
a privilege communication and cannot be admitted in evidence
without the consent of the writer.
COPYRIGHT
Nature of Copyright:
¬ It is the exclusive right secured by law to an author or his
assigns to multiply and dispose of copies of an intellectual or
artistic creation.
¬ It is a corporeal right to print and publish, and exist
independent of the corporeal property out of which it arises.
The objectives of copyright are:
1. To encourage individuals to intellectual labor by
assuring them of just rewards;
2. To secure the society of the largest benefit of their
products.
Right of a copyright owner:
¬ To print, reprint, publish, copy, distribute, multiply, sell and
make photographic illustrations of the copyrighted work.
¬ To make translations or other versions or extracts or
arrangements or adaptations thereof.
¬ To exhibit, perform, represent, produce or reproduce the
copyright work.
¬ To make any other use or disposition of the copyrighted work.
Extent of the protection:
• Concepts, theories, speculations, abstracts of ideas
however original they may be are not covered by the
protection, because there is no monopoly of theories and
speculations of an author. He may transfer these theories of
ideas into intellectual products as books, letters or any form
of writing or illustration. These are exclusively his.
• But once caused to be published, his exclusive right over
the same causes, except when copyrighted. But the
protection extends only in so far as the form, language or
style of the production are concerned and not the theories or
the ideas themselves. So that when one copies the form,
style and language, there is infringement. It should be a
copy of the original but similarity alone is not sufficient,
what is important though is the copy is so near to the
original as to give to every person seeing it the idea created
by the original.
Note: Copyright does not extend to the general concept or format
of a dating game show.
Francisco G. Joaquin & BJ Productions, Inc., vs. Hon.
Franklin Drilon, et. al., [G.R. No. 108946, January 28, 1999]
FACTS: This is a prosecution for violation of PD 49 [Decree on
Intellectual Property]. Joaquin and BJ Productions, Inc. holder
of a Certificate of Copyright of a TV dating game show, “Rhoda
Marianne Macayra
and Me”, claimed that IXL Productions & RPN Channel 9
infringed upon their copyright by copying the format and style
thereof in its show, “It’s a Date”.
HELD: The Court, speaking thru Justice Mendoza, ruled that the
format of a show is not copyrightable. The format or mechanics
of a television show is not included in the list of protected works
in P.D. No. 49. For this reason, the protection afforded by the
law cannot be extended to cover them.
Copyright, in the strict sense of the term, is purely a
statutory right. It is a new or independent right granted by the
statute, and not simply a pre-existing right regulated by the
statute. Being a statutory grant, the rights are only such as the
statute confers, and may be obtained and enjoyed only with
respect to the subjects and by the persons, and on terms and
conditions specified in the statute.
P.D. No. 49, in enumerating what subjects are subject to
copyright, refers to finished works and not to concepts. The
copyright does not extend to an idea, procedure, process,
system, method of operation, concept, principle, or discovery,
regardless of the form in which it is described, explained,
illustrated, or embodied in such work. Thus, the new
INTELLECTUAL PROPERTY CODE OF THE PHILIPPINES
provides:
SECTION 175. Unprotected Subject Matter. -
Notwithstanding the provisions of Section 172 and 173, no
protection shall extend, under this law, to any idea,
procedure, system, method or operation, concept, principle
discovery or mere data as such, even if they are expressed,
explained, illustrated or embodied in a work; news of the
days and other miscellaneous facts having the character of
mere items of press information; or any official text of a
legislative, administrative or legal nature, as well as any
official translation thereof.
Cinematographic works and works produced by a process
analogous to cinematography or any process for making audio-
visual recordings;
The copyright does not extend to the general concept or
format of its dating game show. Accordingly, by the very nature
of the subject of petitioner BJPI’s copyright, the investigating
prosecutor should have the opportunity to compare the
videotapes of the two shows.
Mere description by words of the general format of the two
dating game shows in insufficient, the presentation of the master
videotape in evidence was indispensable to the determination of
the existence of probable cause. As aptly observed by
respondent Secretary of Justice: A television show includes more
than mere words can describe because it involves a whole
spectrum of visuals and effects, video and audio, such that no
similarity or dissimilarity may be found by merely describing the
general copyright/format of both dating game shows.
The requirement of originality: Originality does not mean
novelty or ingenuity, neither uniqueness nor creativity. The law
does not impose such requirements. Originality simply means
that the work “owes its origin to the author”. It means that the
 Page 32 of 32
work is an independent creation of the author. [See: IPL by
Ranhilio C. Aquino, 2003 Ed.]
Requisites:
a. The work must originate from its author;
b. It must not be copied;
c. It must involve some intellectual effort.
Note:
• Copyright extends to adaptations of the original work.
However, in regard to works that are adaptations, such as
abridged works, digests, anthologies – There will still be
originality sufficient to warrant copyright protection if the
author, through his skill and effort, has contributed a
distinguishable variation from the older works. In such a case,
only those parts which are new are protected by the new
copyright.
• Garfield’s creator obviously has copyright to the comic strips
that entertain us with the antics of this strange mutant of a
feline. But does the copyright protection operate to bar an
entrepreneur from creating Garfield stuffed toys or sculptor
from immortalizing the flabby cat in Italian marble? A simpler
judicial approach would be to treat the toy or the piece of a
sculpture as a derivative work, and thus, to require authority
from Garfield’s creator before allowing it legal status. [See: IPL
by Ranhilio C. Aquino, 2003 Ed.]
THE INTERLEGO DOCTRINE
“There must be in addition some element of material alteration or
embellishment which suffices to make the totality of the work an
original work. Even a relatively small alteration or addition
quantitatively may, if material, suffice to convert that which is
substantially copied from an earlier work into an original work.
Whether it does so or not is a question of degree having regard
to the quality rather than the quantity of the addition. But copying
per se, however much skill or labor might be devoted to the
process could not make an original work.”
Note: What is protected by copyright is not merely the visual
appearance but the work as embodied in a particular artistic
medium, example - an artfully blown glass rose versus a
transposition of the same rose but into different artistic medium –
a pencil sketch. Is there infringement? A skillfully and artistically
blown glass rose is protected as a glass rose, so that changing
the medium is not infringing the work. [See: IPL by Ranhilio C.
Aquino, 2003 Ed.]
A copyright precludes trademark registration.
In United Feature Syndicate vs. Munsingwear, GR No. 76193,
11-9-89, the SC held that the exclusive rights vested by PD 49 in
favor of a copyright owner preclude the appropriation of the same
work as a trademark.
QUESTION: Would public display of a purchased copyrighted
work, like paintings constitute infringement?
Generally, there is no infringement. PD 49 and RA 8293 are
silent on this point. It is patently absurd to deny a purchaser of a
work of art the right to display it publicly and to impose upon him
the obligation of concealing it from public view.
Marianne Macayra
Excepted from this privilege are works produced by film, slide,
television image or analogous process. Otherwise, copyright in
them would mean nothing at all, for public display, showing or
exhibiting them are precisely the source of economic advantage
for their creators, while painters and sculptors derive economic
gain from the sale of the work itself.
However: [see: IPL by Ranhilio C. Aquino, 2003 Ed.]
a. A protected photograph cannot be copied by drawing
or by photographic reproduction;
b. A choreographic work is infringed by a still photo while
dance routine is in progress;
c. A photograph of copyrighted jewelry infringes
copyright.
When is there infringement?
Substantial reproduction does not require reproduction of the
entire copyrighted work, or even a large portion thereof.
If so much is taken that the value of the original work is
substantially diminished, or the labors of the original author are
substantially and to an injurious extent appropriated by another,
that is sufficient in point of law to constitute piracy.
It is not the copying, per se, that is prohibited but the injurious
effect it has on the author of the copied work. The unfair
appropriation of one’s research effort is sufficient injury to sustain
a claim. (See: Habana vs. Robles GR No. 131522, 7-09-99)
Remedies in case of infringement:
a. Damages;
b. Injunction;
Effect of expiration: On the final expiration of the copyright
term, the whole work falls into the public domain and becomes
free and unrestricted.
TRADEMARKS
General Garments Corporation vs. the Director of Patents
and Puritan Sportswear Corporation [G.R. No. L- 24295.
September 30, 1971]
ISSUE: Whether or not a foreign corporation, unlicensed and
unregistered to do business in the Philippines has legal capacity
to maintain a suit in the Philippine Patent Office for cancellation
of a registered trademark.
A foreign corporation which has never done business in the
Philippine Islands and which is unlicensed to do business here,
but widely and favorably known in the Islands through the use of
its products bearing its corporate and trade name has a legal
right to maintain an action in the Islands.
The purpose of such a suit is to protect its reputation,
corporate name and goodwill which have been established
through the natural development of its trade for a long period of
years. The right to the use of the corporate or trade name is a
property right, a right in rem, which it may assert and protect in
any of the courts of the world- even in jurisdictions where it does
not transact business- just the same as it may protect its tangible
property, real or personal against trespass or conversion.
 Page 33 of 33

Ang Si Heng and Salustiana Dee vs. Wellington Dept. Store Philippine Refining Co., Inc., vs. Ng Sam and the Director of
Inc., Benjamin Chua, S.R. Mending Store Inc. Mendinueto, Patents (Gr No. L-26676, July 30, 1982)
and Filemon Cosio (G.R. No. L.4531, Jan. 10, 1953)
Camia Cooking Oil vs. Camia Ham
ISSUES: Are geographical indications registrable? When does
ISSUE: Whether or not registration of the same mark under the
use of trade name constitute unfair competition?
same class for non-competitive and unrelated goods may be
a. The term “Wellington” is either a geographical name or allowed.
surname of a person. Geographical names are regarded as
HELD: The parties are non-competitive and their products so
common property and it is a general rule that the same
unrelated that the sue of identical trademarks is not likely to give
cannot be appropriated as the subject of an exclusive
rise to confusion, much less cause damage to petitioner.
trademark or trade name. Even if Wellington was a
surname, it cannot also be validly registered as trade name. While ham and some of the products of petitioner are
classified under Class 47 (Foods and Ingredients of Food), this
Therefore an action for violation of trademark cannot be
alone cannot serve as the decisive factor in the resolution of
maintained because the right to damages or injunction is
whether or not they are related goods. Emphasis should be on
granted only to those entitled to the exclusive use of a
the similarity of the products involved and not on the arbitrary
registered trademark or trade name. (Section 23, Republic
classification or general description of their properties or
Act No. 166)
characteristics. The particular goods of the parties are so
b. On unfair competition, while there is a similarity between unrelated that consumers would not in any probability mistake
the trademark or tradename “Wellington Company” and that one as the source or origin of the product of the other.
of “Wellington Department Store,” no confusion or deception
“Ham” is not a daily food fare for the average consumer.
can possibly result or arise from such similarity because the
One purchasing ham would exercise a more cautious inspection
latter is a “department store”, while the former does not
of what he buys on account of its price. In addition, the goods of
purport to be so. Moreover, the Supreme Court held that the
petitioners are basically derived from vegetable oil and animal
public cannot be deceived that the goods of the plaintiff
fats, while the product of respondent is processed from pig’s
originate from the defendant’s store because the
legs. A consumer would not reasonably assume that petitioner
defendant’s store does not sell clothing apparels bearing the
has so diversified its business to include the product of
plaintiff’s mark “Wellington”.
respondent.
Neither could such deception by any possibility be produced
The term “CAMIA” is descriptive of a whole genus of garden
because the defendant’s store is situated at Escolta, while
plants with fragrant white flowers. Some people call the “CAMIA”
plaintiff’s store or place of business is located in another
the “white ginger plant” because of its tuberous roots, while
business district far away from Escolta. The mere fact that
children refer to it as the butterfly flower because of its shape.
two or more customers of the plaintiffs thought of the
Being a generic and common term, its appropriation as a
probable identity of the products sold by one and the other
trademark, albeit in a fanciful manner in that it bears no relation
is not sufficient proof of the supposed confusion that the
to the product it identifies, is valid. However, the degree of
public has been led into by the use of the name adopted by
exclusiveness accorded to each user is closely restricted.
the defendants. No evidence has been submitted that
customers of the plaintiffs-appellants had actually been Esso Standard Eastern Inc., vs. United Cigarette Corp. G.R.
misled into purchasing defendant’s articles and No. L-29971, Aug. 31, 1982
merchandise.
Esso Petroleum vs. Esso Cigarette
Crisanta Y. Gabriel vs. Jose R.Perez and Honorable Tiburcio
ISSUE: Whether or not the protection afforded by a trademark
Evalle as Director of Patents (G.R. No. L-24075, January 31,
1974) registration extends to all goods.

ISSUE: Whether or not petitioner as exclusive distributor of
Respondent became the rightful, owner of the trademark
“WONDER”.
The exclusive distributor does not acquire any proprietary
interest in the principal’s trademark. “In the absence of any
inequitable conduct on the part of the manufacturer, an exclusive
distributor, who employs the trademark of the manufacturer, does
not acquire proprietary interest in the mark which will extinguish
the rights of the manufacturer, and a registration of the trademark
by the distributor as such belongs to the manufacturer, provided
the fiduciary relationship does not terminate before application for
registration is filed.” (87 CJS 258-259, citing cases.)
Marianne Macayra
The goods on which petitioner uses the trademark ESSO,
petroleum products, and the product of respondent, cigarettes,
are non-competing. Trademark infringement depends on whether
or not the goods of the parties are so related that the public may
be, or is actually, deceived and misled that they came from the
same manufacturer. In cases of related goods, confusion of
business could arise out of the use of similar marks, in the case
of non-related goods, it could not.
In the case at bar, the goods are obviously different from
each other – with “absolutely no iota of similitude”. They are so
foreign that it is unlikely that purchasers would think that
petitioner is the manufacturer of respondent’s goods. One of the
factors that show that the goods involved are non-competitive
and non-related is the fact that respondent’s goods are beyond
Petitioner’s “zone of potential or natural and logical expansion”.
 Page 34 of 34
Moreover, respondent’s goods are distributed through different
channels of trade.
SIMILARITY TEST: To determine whether a trademark has been
infringed, the mark as a whole must be considered and not as
dissected. If the buyer is deceived, it is attributable to the marks
as a totality, not usually to any part of it [Del Monte Corporation
vs. Court of Appeals, 181 SCRA 410]
DISSIMILARITY TEST [or the so-called “visible difference
test”]: In the case of Asia Brewery vs. Court of Appeals (224
SCRA 437), the SC applied the “dissimilarity test” or “visible
difference test” in determining whether or not there exists unfair
competition. In this case, while the Supreme Court did not
abandon the “similarity test”, it nevertheless, qualified the same
when it applied the “visible difference test” especially so when the
dissimilarities abound. It said: “Besides the dissimilarity in their
names, the following other dissimilarities in the trade dress or
appearance of the competing brands abound:
1. The SAN MIGUEL PALE PILSEN bottle has a slender
tapered neck. The BEER PALE PILSEN bottle has a
fat, bulging neck;
2. The words “pale pilsen” on SMC’s label are printed in
bold and laced letters along a diagonal band, whereas
the words “pale pilsen” on ABI’s bottle are half the size
and printed in slender block letters on a straight
horizontal band;
3. The names of the manufacturers are prominently
printed on their respective bottles. SAN MIGUEL PALE
PILSEN is “Bottled by San Miguel Brewery Philippines,”
whereas BEER PALE PILSEN is “Especially brewed
and bottled by Asia Brewery Incorporated, Philippines;
4. On the back of ABI’s bottle is printed in big, bold letters,
under a row of flower buds and leaves, its copyrighted
slogan: BEER NA BEER!” Whereas SMC’s bottle
carries no slogan;
5. The back of the SAN MIGUEL PALE PILSEN bottle
carries the SMC logo, whereas the BEER PALE
PILSEN bottle has no logo;
6. The SAN MIGUEL PALE PILSEN bottle cap is stamped
with a coat of arms and the words “San Miguel Brewery
Philippines” encircling the same. The BEER PALE
PILSEN bottle cap is stamped with the name “BEER”
in the center, surrounded with the words “Asia Brewery
Incorporated Philippines;
7. Finally, there is a substantial price difference between
BEER PALE PILSEN (currently at P4.25 per bottle) and
SAN MIGUEL PALE PILSEN (currently at P7.00 per
bottle). One who pays only P4.25 for a bottle of beer
cannot expect to receive San Miguel Pale Pilsen from
the storekeeper or bartender.”
• In the Asia Brewery case, the Supreme Court deviating from
the Del Monte ruling further said: “The ruling may not apply to
all kinds of products. In resolving cases of infringement and
unfair competition, the courts should take into consideration
several factors which would affect its conclusion, to wit: the
Marianne Macayra
age, training and education of the usual purchaser, the nature
and cost of the article, whether the article is bought for
immediate consumption and also the conditions under which it
is usually purchased.
• The Del Monte case involved catsup, a common household
item which is bought off the store shelves by housewives and
house help who, if they are illiterate and cannot identify the
product by name or brand, would very likely identify the
product by mere recollection of its appearance.
Since the competitor, Sunshine Sauce Mfg. Industries,
not only used recycled Del Monte bottles for its catsup (despite
the warning embossed on the bottles: “Del Monte Corporation.
Not to be refilled.”) but also used labels which were a
“colorable imitation” of Del Monte’s label, we held that there
was infringement of Del Monte’s trademark and unfair
competition by Sunshine. Our ruling in Del Monte would not
apply to beer which is not usually picked up from a store shelf
by ordered by brand by the beer drinker himself from the
storekeeper or waiter in a pub or restaurant.”
• In Lim Hoa vs. Director of Patents 100 Phil. 214, in rel. to
Etepha vs. Director, 16 SCRA 495, the Supreme Court was
more telling: “The court differentiated food seasoning product,
a kitchen article of daily consumption, from commodities or
articles of relatively great value, such as radio and television
sets, air-conditioning units, machinery, etc., where the
prospective buyer generally the head of a family or a
businessman, before making the purchase, reads the
pamphlets and all literature available, describing the article he
is planning to buy and perhaps even makes comparisons with
similar articles in the market.
He is not likely to be deceived by similarity in the
trademarks because he makes a more or less study of the
same and may even consult his friends about the relative merit
and performance of the article or machinery, as compared to
others also for sale.
UNFAIR COMPETITION:
Alhambra Cigar vs. Mojica March 21, 1914
Unfair competition consists in passing off or attempting to
pass off upon the public the goods or business of one person and
for the goods or business of another. It consists essentially in the
conduct of a trade or business in such a manner that there is
either an express or implied representation to that effect. Unfair
competition, as thus defined, is a legal wrong for which the courts
afford a remedy. It is a tort and a fraud. The basic principle is that
no one has a right to dress up his goods or otherwise represent
them in such a manner as to deceive an intending purchaser and
induce him to believe he is buying the goods of another. Actual or
probable deception and confusion on the part of customers by
reason of defendant’s practices must always appear to be
considered as an act of unfair competition.
In addition to that, it is not necessary to show that any
person has been actually deceived by defendant’s conduct and
lead to purchase his goods in the belief that they are the goods of
plaintiff, it is sufficient to show that such deception will be natural
and probable result of defendant’s acts. Either actual or probable
 Page 35 of 35
deception and confusion must be shown, for if there is no
probability of deception there is no unfair competition.
In this regard, the class of purchasers who buy the particular
kind of article manufactured must be considered in determining
the question of probable deception. This includes incautious,
unwary or ignorant purchasers, but not purchasers who make no
examination. This is because unfair competition is a case-to-case
basis. The fact that careful buyers, who scrutinize closely, are not
deceived merely shows that the injury is less in degree but not
necessarily mean there is no injury. The same is true with
careless purchasers who are deceived simply by the use of
ordinary and common forms of putting up goods do not
necessarily show unfair competition.
TRIPS [Agreement on the Trade-related aspects of
Intellectual Property Rights]
What is included in the term: “Intellectual Property Rights”?
(Sec. 4 RA 8293)
¬ Copyright and related rights;
¬ Trademarks and Service Marks;
¬ Geographic Indications (One which identifies a good as
originating in a territory of a trips member);
¬ Industrial Designs (Any composition of lines or colors or
any three dimensional form, whether of not associated
with lines or colors and gives a special appearance to and
can serve as pattern for an industrial product or
handicraft);
¬ Patents;
¬ Layout – designs (Topographies) of Integrated Circuits;
¬ Protection of undisclosed information [i.e. trade secrets,
formula]
INTELLECTUAL PROPERTY OFFICE
Functions:
• To grant patents for inventions;
• To register marks, geographic indication, integrated circuits;
technology transfer arrangements;
• To administratively adjudicate contested proceedings
affecting IPR;
Structure: The IPO is headed by a director general
There are 6 bureaus, each headed by a director:
1. Bureau of Patents; (Functions: search and examination
of patent applications and the grant of patents);
2. Bureau of Trademarks: (function: search and
examination of applications for the registration of marks
of ownership and the issuance of the certificate of
registration);
3. Bureau of Legal Affairs - Functions:
a. hear and decide opposition to the application for
registration of marks; cancellation of trademarks,
Marianne Macayra
patents, industrial designs; and petitions for
compulsory licensing of patents;
b. exercise original jurisdiction in administrative
complaints for violation of laws involving
intellectual property rights: Provided, That its
jurisdiction is limited to complaints where the total
damages claimed are less than P200,000.00:
Provided further, that availment of the provisional
remedies may be granted in accordance with the
Rules of Court];
4. Documentation, Information and Technology Transfer
Bureau - Functions: provide technical, advisory and
other services relating to the licensing and promotion of
technology, and carry out an efficient and effective
program for technology transfer; register technology
transfer arrangement; and settle disputes involving
technology transfer payments];
5. The Management Information System and EDP
Bureau;
6. The Administrative, Financial and Personnel Service
Bureau;
PATENT
What is patent? A grant made by the government to an inventor,
conveying and securing to him the exclusive right to make use of
his invention for a given period.
What are patentable inventions? Any technical solution to a
problem in any field of human activity which is new, involves an
inventive step and is industrially applicable. It may be, or may
relate to: a product; or process; or an improvement of any of the
foregoing. (Sec. 21) Example: A new and useful machine; a
manufactured product or substance; or an improvement of any of
the foregoing.
When shall an invention be considered as “new”?
¬ When it is novel; (Sec 23)
¬ When it does not form part of a prior art.
Prior art shall consist of: everything which has been made
available to the public anywhere in the world, before the
filing date of the application claiming invention, which means
that the “invention” is: (a) already known; (b) publicly used;
or (c) already patented or described;
When an invention is considered useful? When it is capable
performing some beneficial function.
NON-PATENTABLE INVENTIONS:
¬ Discoveries, scientific theories and mathematical methods;
¬ Schemes, rules and methods of performing mental acts,
playing games or doing business, and programs for
computer;
¬ Methods for treatment of the human or animal body by
surgery or therapy and diagnostic methods practiced on
human or animal body;
 Page 36 of 36
¬ Plant varieties or animal breeds or essentially biological
process for the production of plants and animals except:
micro-organisms and non-biological and micro-biological
processes;
¬ Aesthetic creations; or
¬ Anything contrary to public order or morality.
Who has a RIGHT to a patent?
ü The right to a patent belongs to the inventor, his heirs or
assigns;
ü When two (2) or more persons have jointly made an
invention, the right to a patent shall belong to them jointly.
(co-ownership)
ü If two or more persons have made the invention separately
and independently of each other, the right to the patent
shall belong to the person who filed an application for such
invention;
ü Where two or more applications are filed for the same
inventions, to the applicant who has the earliest filing date
or the earliest priority date.
ü The person who commissions the work shall own the
patent, unless otherwise provided in the contract;
ü In the case the employee made the invention in the course
of his employment contract, the patent shall belong to :
• The employee, if the inventive activity is not a part of
his regular duties even if the employee uses the time,
facilities and materials of the employer;
• The employer, if the invention is the result of the
performance of his regularly assigned duties, unless
there is an agreement to the contrary
RIGHT OF PRIORITY
An application for patent filed by any person who has
previously applied for the same invention in another country,
which by treaty, convention, or law affords similar privileges to
Filipino citizens, shall be considered as filed as of the date of the
filing the foreign application: Provided, That:
a. The local application expressly claims priority;
b. It is filed within 12 months from the date of copy of the
foreign application was filed;
c. A certified copy of the foreign application together with
an English translation is filed w/in 6 months from the
date of filing in the Philippines.
Term of Patent: 20 years from the filing date of the application.
RIGHT OF PATENTEE:
A patentee shall have the exclusive right to make; use and
sell the patented machine, article or product, and to use the
patented process for the purpose of industry or commerce, thru-
out the Philippines for the duration of the patent.
INFRINGEMENT OF PATENT:
Marianne Macayra
A violation of the right which is secured to the inventor by
the patent law (IPC) constitutes an infringement. It consists in the
making, using, selling of the patented process or instrumentality
by any person without authorization on the part of the patentee.
TEST: In order to constitute infringement there must be
SUBSTANTIAL IDENTITY (not exact identity) between the two
devices.
They are identical: When they perform substantially the
same function (or mode or principle) in substantially the same
way to obtain the same result, even if they differ in name, form,
shape or dimensions. (Doctrine of equivalents)
NO INFRINGEMENT:
¬ When the original machine is improved by the use of
different form or combination although performing the same
functions.
¬ When a single element in the original device is left out in the
new device.
¬ When the making or using of a patented invention is not
conducted for profit and solely for the purpose of research
or experiment or for instruction.
¬ Preparation of a medicine for individual cases in a pharmacy
or by a medical professional in accordance with a medical
prescription.
¬ When used in any foreign ship or vessel, aircraft or land
vehicle for its exclusive needs (not for purposes of
manufacture or sale) entering the Philippines temporarily or
accidentally;
¬ Any prior user who in good faith was using the invention in
his business or enterprise prior to the filing or priority date of
the application on which a patent is granted.
¬ Use by the government or third persons authorized by the
government when :
a. Required by public interest. (i.e.: national security;
nutrition; health; development of other sectors); or
b. It is determined by an administrative or judicial body
that the exploitation by the owner of the patent is anti-
competitive.
Note: The burden of proof to show infringement of a patent is on
the party who asserts such infringements.
Defenses:
a. The patent is invalid;
b. The invention is not new and patentable;
c. The patent does not disclose the invention in a manner
sufficiently clear and complete for it to be carried out by
person skilled in the art;
d. The patent is contrary to public order or morality.
Remedies: Civil action for damages plus injunction.
 Page 37 of 37
DONATIONS
Art. 725. Donation is:
An act of liberality whereby a person disposes gratuitously of a
thing or right in favor of another who accepts it.
Essential requisites:
a. The reduction in the patrimony of the donor;
b. The increase in the patrimony of the donee;
c. The intent to do an act of liberality.
Note: When a person gets a life insurance and names a third
person as his beneficiary, and the insurance becomes payable
by the death of the insured, there is a donation in favor of the
beneficiary – not in the sum received by him from the insurer, but
in the total amount of premiums that have been paid by the
insured. This is the only amount that leaves the patrimony.
If the amount of premiums, however, exceeds the
insurance, there is donation only to have extent of the insurance.
This is the only amount that is added to the patrimony of the
donee.
Classification of donations:
1. Simple - the cause is pure liberality (no strings attached);
2. Remuneratory - to reward past services which do not
constitute demandable debt (ex: A donation to one who
saved the donor’s life).
Note: The phrase “they do not constitute a demandable
debt” (Art. 726) means that the service which was rendered
did not produce an obligation demandable against the
donor; or if it had, such obligation has been renounced in
favor of the donor.
EXAMPLE: A agreed to review B for the bar examinations
for a fee of P10,000.00. Later, B passes the bar
examination, and as a gratitude gives A a parcel of land
worth P20,000.00. The remuneratory donation here is only
with respect to the excess of P10,000.00 because, the
services of A constitute a demandable debt, unless, A in the
meantime renounces his fees and in such case , there is
donation to the extent of P20,000.00.
3. Conditional or Modal – when the donation imposes upon
the donee an obligation in favor of the donor himself or a
third person or even the public.
EXAMPLE: A piece of land is donated to the city in order
that it may be converted into a park or public market.
Form to be followed:
¬ In simple/remuneratory donations - form of donations
¬ Onerous donations - contracts.
Art. 727. Illegal or impossible conditions in simple and
remuneratory donations shall be considered as not
imposed.
Marianne Macayra
Note:
• It is supposed to be simple (no strings attached), why is
there a need to have a condition, much less, impossible?
• If the condition is not void, then the donation is not really
simple, for it has a burden imposed upon the donee.
• What is voided here is the impossible condition and not the
donation itself.
FACTS: Fernando and Placido Manalo “donated” a parcel of land
to their niece, Leoncia, on the condition that the latter would
shoulder the “funeral expenses” of the former when they die. The
donation was done in a private instrument. Is the donation valid?
HELD: Yes, the donation is valid because it is an onerous
donation. It is governed by the law on contracts. A private
instrument was sufficient. [Manalo vs. De Mesa 20 Phil. 496]
DONATION INTER-VIVOS
Art. 730. Effect of the fulfillment of the suspensive condition
beyond the lifetime of the donor.
EXAMPLE: “A” donates a piece of land to “B” on the condition
that “X”, “A’s” son becomes a lawyer.
The fulfillment of the condition even after the death of the donor
does not affect the nature of the donation as inter vivos. The
fulfillment retroacts to the time of the donation.
Art. 731. When a person donates something, subject to the
resolutory condition of the donor’s survival, there is
donation inter-vivos.
Note: Fulfillment of a resolutory condition, its effect.
EXAMPLE: “A” was about to undergo a delicate operation. He
donated to “B” a parcel of land subject to the condition that if “A”
survives the operation, “B’s” ownership over the land would
terminate, and the same would revert to “A”. But if “A” dies, there
is donation inter vivos not mortis causa.
When is donation perfected?
Art. 734. The donation is perfected from the moment the
donor knows of the acceptance by the donee;
Art. 746. Acceptance must be made during the lifetime of the
donor and the donee.
Who may donate?
Art. 735. All persons who may contract and dispose of their
property may make a donation.
Art.737. The donor’s capacity shall be determined as of the
time of the making of the donation.
REMINDER: The phrase “as of the time of the making of the
donation” should really mean “as of the time of the perfection of
the donation”. So that, a physically incapacitated person (i.e.
unemancipated minors or insane) may still validly donate
provided that at the time of his knowledge of the acceptance by
the donee, the incapacity is not present. Although, it is submitted
 Page 38 of 38
that the donation is voidable following the law on contracts which
are suppletory to simple donation – as in vitiated consent.
The capacity of the donee is determined at the time of the
perfection of the donation (at the time he makes known to the
donor his acceptance of the donation).
Capacity of the Husband or the Wife: Husbands or wives may
donate their own capital or paraphernal properties without the
consent of the other. But with respect to conjugal or community
property, they cannot make donations without the consent of the
other, except : moderate donations for charity or on occasion of
family rejoicing or family distress, (see : Art. 98 & Art. 125 of the
Family Code ); see also Arts. 113-115 of the Family Code.
May husbands and wives donate to each other?
Art. 87. Family Code – Every donation or grant of gratuitous
advantage, direct or indirect, between the spouses during
the marriage shall be void, except moderate gifts which the
spouses may give each other on the occasion of any family
rejoicing. The prohibition shall also apply to person living
together as husband and wife without a valid marriage.
Reason: To protect the creditors and the weaker spouse from the
dominance of the other.
What is moderate is relative. This may be determined based on
the financial status of the family.
Capacity of a minor: For purposes of marriage, a person may
contract marriage at the age of 18 years. But may he enter into a
marriage settlement wherein he may dispose of his future
property in favor of his prospective spouse without the
intervention of the parents?
Art. 78. (in relation to Art. 234 and 236 of the Family Code) which
requires that the parents are required to be made parties to the
marriage settlements was impliedly repealed by RA 6809,
wherein marriage settlements may now be entered by the child
personally even without the intervention of the parents.
Read also: Donations by reason of marriage – Arts. 82 – 87,
Family Code.
What may be donated?
Art. 750. The donation may comprehend all present property
of the donor, or part thereof, provided he reserves in full
ownership or in usufruct, sufficient means for the support of
himself, and all of relatives who at the time of the
acceptance of the donation, are by law entitled to be
supported by the donor. Without such reservation, the
donation shall be reduced on petition of any person
affected.
REMINDER:
¬ The donation may comprehend all present property, meaning
that which the donor can dispose of at the time of the donation
but in all instances, the donor cannot give more than what he
can give by will (meaning, a person cannot receive more than
what the giver can give by virtue of a will). Otherwise, the
donation is considered inofficious.
Marianne Macayra
¬ The sufficiency can be determined by the court in accordance
with prudence and the exercise of reasonable discretion.
¬ Excessive or inofficious donation is not void but merely
reducible.
¬ Donations cannot comprehend future property (Art. 751),
because the donor cannot give what he does not have, except
in cases of contractual succession and donations by reason of
marriage (see : Art. 84, Family Code).
What are the formalities of a donation?
With respect to IMMOVABLE property: (See: Art. 749)
ü The donation must be in a PUBLIC DOCUMENT.
ü The acceptance must also be in a PUBLIC
DOCUMENT.
With respect to MOVABLE property:
ü The donation must be in writing.
ü If the value of the thing is P5,000.00 or less :
• may be oral but simultaneous delivery of the thing
and the document representing the right donated is
required;
• may be in writing;
ü In both instances (where the donation is either oral or
written), the acceptance may be made orally (express
or implied) or in writing;
SPECIAL DISQUALIFICATION
See: Arts. 739 and 740
a. Those made between persons who are guilty of adultery
or concubinage at the time of the donation;
Notes:
• This refers to donations between paramours.
• There is no necessity of proving the guilt in a criminal
proceedings, it is enough that the guilt may be proven by
a preponderance of evidence in a civil action for the
declaration of nullity of the donation.
• The commission of the adultery or concubinage must be
at the time of the donation and not after.
• When the purpose of the donation is to initiate, continue,
resume or compensate the illicit relations between the
paramours, the donation is void.
• But if the intention is to indemnify the damaged caused to
the other at the time of separation, the donation is valid.
b. Those made between persons found guilty of the same
offense, in consideration thereof;
Note:
• If a person agrees to kill another in consideration of a
donation to be made in his favor, the donation is void.
 Page 39 of 39
• Here, since the consideration is illegal, the donation, must
necessarily be void;
• There must be a conviction.
c. Those made to a public officer or his spouse,
descendants or ascendants by reason of his office.
Note:
• The purpose for the rule is to prevent bribery;
• The donation is void by reason of public policy.
Art. 740. Incapacity to succeed by will shall be applicable to
donations inter-vivos. The following persons are
disqualified:
a. The priest who heard the confession of the donor
during his last illness, or
b. The minister of the gospel who extended spiritual aid to
him during the same period;
c. The relatives of such priest or minister of the gospel
within the 4th civil degree, the church the order,
chapter, community, organization, or institution to
which such priest or minister belongs;
d. The guardian with respect to donations made by the
ward in his favor before the final accounts of the
guardianship have been approved, even if the donor
should die after the approval thereof; nevertheless any
donation made by the ward in favor of the guardian
when the latter is his ascendant, descendant, brother,
sister, or spouse, shall be valid;
e. Any physician surgeon, nurse, health officer, or
druggist who took care of the donor during his last
illness;
f. Individuals, associations and corporations not
permitted by law to receive donations.
Note: The incapacity to inherit by reason of unworthiness
provided in Art. 1032 is not included within the scope of the
above article.
A donation made to a person who falls under the provisions
of said article would be valid, because a testamentary provision
made in favor of such person after the testator has knowledge of
the act of unworthiness would constitute pardon under Art. 1033.
On the other hand, if the donation has already been made
when the cause of unworthiness occurs, the donation is
revoked only by the causes mentioned in Arts. 760, 764 and
765.
RULES IN CASES OF DOUBLE DONATIONS:
• Apply the rule on double sales, Art. 1544, NCC;
a. Movable property - the ownership shall be transferred
to the donee who have first taken possession thereof in
good faith.
Marianne Macayra
b. Immovable property – the ownership shall belong to the
donee who first recorded it in the registry of property.
• If there be no inscription, the ownership shall pertain to the
donee who in good faith was the first in the possession. And
in the absence thereof, to the donee who presents the oldest
title, provided there is good faith.
REVOCATION AND REDUCTION OF DONATIONS
Art. 760. Every donation inter-vivos made by a person
having no children or descendants, legitimate or legitimated
by subsequent marriage, or illegitimate, may be revoked or
reduced by the happening of any of these events:
a. If the donor, after the donation, should have legitimate
or legitimated children, even though they be
posthumous; BIRTH
b. If the child of the donor whom the latter believed to be
dead when he made the donation, should turn out to be
living; REAPPEARANCE
c. If the donor should subsequently adopt a minor child.
ADOPTION
Note:
¬ When the revocation should take effect: The donation is
revoked or reduced by the happening of any of the events
enumerated in Art. 760. In other words, the revocation or
reduction takes place ipso jure. No action is necessary to
revoke or reduce the donation which is already considered by
law as revoked. Court action is necessary however, when the
donee refuses to return the property. In such case, the
decision of the court will be merely declaratory of the
revocation – it will not be a revocatory act.
¬ Birth, reappearance and adoption as causes for the revocation
or reduction. The article seeks to protect the presumptive
legitimate or the expected legitime of the heir.
¬ The value of the estate to be considered is at the time of the
birth, reappearance or adoption.
¬ The action to reduce must be brought within 4 years, see: Art.
763. This action cannot be renounced.
¬ The article applies only to donation inter vivos and not to:
a. donations propter nuptias (which can be revoked only
for causes enumerated by law);
b. onerous donations (for these are really contracts);
c. mortis causa (for this is revocable for any or no cause
at all).
ILLUSTRATION: “X” has no child. At the time he gave the
donation of P10,000.00, he had P100,000.00. Therefore after the
donation, he had P90,000.00 left. Later, he adopted a minor
child. At the same time he made the adoption he had only
P5,000.00 left. Should the donation be reduced? If so, how
much?
 Page 40 of 40

Note: The value of the estate to be considered is at the time of Art. 769. Prescriptive period for revocation by reason of
birth, reappearance or adoption. ingratitude shall be 1 year to be counted from the time the
donor had knowledge of the fact and it was possible for him
Donation = P10,000.00
to bring the action.
Property left at the time of adoption = P 5,000.00
Art. 770. The action for revocation is not transmitted to the
P15,000.00 heirs of the donor.
Legitime = P15,000.00 x ½ = P 7,500.00 Reason: Because the grounds for revocation are purely personal
to the donor.
Since the value of the estate is only P5,000.00, the donation
must be reduced by P2,500.00. Exceptions:
See: Cruz vs. CA, 140 SCRA 245 ¬ When the action was already instituted but the donor
subsequently died;
Art. 764. A donation may also be revoked at the instance of
the donor when the donee fails to comply with any of the ¬ When the donor is killed by the donee;
conditions which the former imposed upon the latter.
¬ The donor died without knowing the act of ingratitude.
Exception: When the condition is immoral, illegal or impossible.
Art. 771. Inofficious donations:
Notes:
a. The value of the estate is the value at the time of the
¬ Effect of non-fulfillment – the donor has the choice of donor’s death.
enforcing the condition by action for specific performance.
b. Net Estate + property left at the time of death minus
The donee having bound himself to carry out the condition
debts and charges plus value of donations.
imposed by accepting the donation, may be compelled with
what has been stipulated. c. The donation may be considered inofficious, only in so
far as it may affect the legitime of the heirs;
¬ A court action is necessary if the donee refuses to return
the property d. Since the inofficiousness of the donation cannot be
determined till after the donor’s death, it follows that in
Art. 765. The donation may also be revoked at the instance
the meantime, the donation is valid and ownership is
of the donor, by reason of ingratitude in the following cases:
transmitted to the donee during the donor’s lifetime.
a. If the donee should commit some offense against
Prescriptive period: The action to reduce or revoke may be
the person, the honor, or the property of the donor or of
brought within a period of 5 years from the time of the donor’s
his wife or children under his parental authority;
death. See: Art. 1149, NCC
Note:
Who may bring action to reduce?
• Offense does not mean a criminal offense; it may
• Compulsory heirs of the donor;
also include non-criminal offenses.
• Heirs and successors-in-interests of the compulsory heirs.
• No criminal conviction is necessary, and proof of the
offense by mere preponderance of evidence in a suit
for revocation is sufficient.
b. If the donee imputes to the donor any criminal
offense, or any act involving moral turpitude, even
though he should prove it, unless the crime of the act
has been committed against the donee himself, his wife
or children under his authority;
c. If he unduly refuses him support when the donee is
legally or morally bound to give support to the donor.
Notes:
• There is legal or moral ground;
• The refusal to support must be “undue” or
“unjustified”
• It is understood that the support given periodically
should not exceed the value of the thing donated.
The moment this amount is reached, the duty to
support also ends.

Marianne Macayra