Makati Leasing & Finance Corp., v. Wearever Textile Mills, Inc., G.R. No. L-58469.

May, 16, 1983

Facts:

It appears that in order to obtain financial a cv87ccommodations from herein

petitioner Makati Leasing and Finance Corporation, the private respondent Wearever
Textile Mills, Inc., discounted and assigned several receivables with the former
under a Receivable Purchase Agreement. To secure the collection of the receivables
assigned, private respondent executed a Chattel Mortgage over certain raw
materials inventory as well as a machinery described as an Artos Aero Dryer
Stentering Range.

Upon private respondent’s default, petitioner filed a petition for extrajudicial

foreclosure of the properties mortgage to it. However, the Deputy Sheriff assigned
to implement the foreclosure failed to gain entry into private respondent’s premises
and was not able to effect the seizure of the aforedescribed machinery. Petitioner
thereafter filed a complaint for judicial foreclosure with the Court of First Instance of
Rizal, Branch VI, docketed as Civil Case No. 36040, the case before the lower court.

On July 13, 1981, the sheriff enforcing the seizure order, repaired to the premises of
private respondent and removed the main drive motor of the subject machinery.

The Court of Appeals, in certiorari and prohibition proceedings subsequently filed by

herein private respondent, set aside the Orders of the lower court and ordered the
return of the drive motor seized by the sheriff pursuant to said Orders, after ruling
that the machinery in suit cannot be the subject of replevin, much less of a chattel
mortgage, because it is a real property pursuant to Article 415 of the new Civil
Code, the same being attached to the ground by means of bolts and the only way to
remove it from respondent’s plant would be to drill out or destroy the concrete floor,
the reason why all that the sheriff could do to enforce the writ was to take the main
drive motor of said machinery.

Issue:

whether the machinery in suit is real or personal property from the point of view of
the parties, with petitioner arguing that it is a personalty, while the respondent
claiming the contrary, and was sustained by the appellate court, which accordingly
held that the chattel mortgage constituted thereon is null and void, as contended by
said Respondent.

Ruling:

1
Examining the records of the instant case, We find no logical justification to exclude
the rule out, as the appellate court did, the present case from the application of the
abovequoted pronouncement. If a house of strong materials, like what was involved
in the above Tumalad case, may be considered as personal property for purposes of
executing a chattel mortgage thereon as long as the parties to the contract so agree
and no innocent third party will be prejudiced thereby, there is absolutely no reason
why a machinery, which is movable in its nature and becomes immobilized only by
destination or purpose, may not be likewise treated as such. This is really because
one who has so agreed is estopped from denying the existence of the chattel
mortgage.

In rejecting petitioner’s assertion on the applicability of the Tumalad doctrine, the

Court of Appeals lays stress on the fact that the house involved therein was built on
a land that did not belong to the owner of such house. But the law makes no
distinction with respect to the ownership of the land on which the house is built and
We should not lay down distinctions not contemplated by law.

It must be pointed out that the characterization of the subject machinery as chattel
by the private respondent is indicative of intention and impresses upon the property
the character determined by the parties. As stated in Standard Oil Co. of New York
v. Jaramillo, 44 Phil. 630, it is undeniable that the parties to a contract may by
agreement treat as personal property that which by nature would be real property,
as long as no interest of third parties would be prejudiced thereby.

Private respondent contends that estoppel cannot apply against it because it had
never represented nor agreed that the machinery in suit be considered as personal
property but was merely required and dictated on by herein petitioner to sign a
printed form of chattel mortgage which was in a blank form at the time of signing.
This contention lacks persuasiveness. As aptly pointed out by petitioner and not
denied by the respondent, the status of the subject machinery as movable or
immovable was never placed in issue before the lower court and the Court of
Appeals except in a supplemental memorandum in support of the petition filed in the
appellate court. Moreover, even granting that the charge is true, such fact alone
does not render a contract void ab initio, but can only be a ground for rendering said
contract voidable, or annullable pursuant to Article 1390 of the new Civil Code, by a
proper action in court. There is nothing on record to show that the mortgage has
been annulled. Neither is it disclosed that steps were taken to nullify the same. On
the other hand, as pointed out by petitioner and again not refuted by respondent,
the latter has indubitably benefited from said contract. Equity dictates that one
should not benefit at the expense of another. Private respondent could not now
therefore, be allowed to impugn the efficacy of the chattel mortgage after it has
benefited therefrom. cralawnad

From what has been said above, the error of the appellate court in ruling that the
questioned machinery is real, not personal property, becomes very apparent.
Moreover, the case of Machinery and Engineering Supplies, Inc. v. CA, 96 Phil. 70,
heavily relied upon by said court is not applicable to the case at bar, the nature of
the machinery and equipment involved therein as real properties never having been
disputed nor in issue, and they were not the subject of a Chattel Mortgage.

Manila Electric Company v. City Assessor, G.R. No. 166102, August 5, 2015

2
Facts:

MERALCO is a private corporation organized and existing under Philippine laws to

operate as a public utility engaged in electric distribution. MERALCO has been
successively granted franchises to operate in Lucena City beginning 1922 until
present time.

On February 20, 1989, MERALCO received from the City Assessor of Lucena a copy
of Tax Declaration No. 019-650013 covering the following electric facilities, classified
as capital investment, of the company: (a) transformer and electric post; (b)
transmission line; (c) insulator; and (d) electric meter, located in Quezon Ave. Ext.,
Brgy. Gulang-Gulang, Lucena City. Under Tax Declaration No. 019-6500, these
electric facilities had a market value of P81,811,000.00 and an assessed value of
P65,448,800.00, and were subjected to real property tax as of 1985.

The LBAA rendered a Decision14 in LBAA-89-2 on July 5, 1989, finding that under its
franchise, MERALCO was required to pay the City Government of Lucena a tax equal
to 5% of its gross earnings, and "[s]aid tax shall be due and payable quarterly and
shall be in lieu of any and all taxes of any kind, nature, or description levied,
established, or collected x x x, on its poles, wires, insulators, transformers and
structures, installations, conductors, and accessories, x x x, from which taxes the
grantee (MERALCO) is hereby expressly exempted." 15 As regards the issue of
whether or not the poles, wires, insulators, transformers, and electric meters of
MERALCO were real properties, the LBAA cited the 1964 case of Board of
Assessment Appeals v. Manila Electric Company 16 (1964 MERALCO case) in which
the Court held that: (1) the steel towers fell within the term "poles" expressly
exempted from taxes under the franchise of MERALCO; and (2) the steel towers
were personal properties under the provisions of the Civil Code and, hence, not
subject to real property tax. The LBAA lastly ordered that Tax Declaration No. 019-
6500 would remain and the poles, wires, insulators, transformers, and electric
meters of MERALCO would be continuously assessed, but the City Assessor would
stamp on the said Tax Declaration the word "exempt."

Six years later, on October 29, 1997, MERALCO received a letter19 dated October
16, 1997 from the City Treasurer of Lucena, which stated that the company was
being assessed real property tax delinquency on its machineries beginning 1990.

Issue:
THE COURT OF APPEALS COMMITTED A GRAVE REVERSIBLE ERROR IN AFFIRMING
IN TOTO THE DECISION OF THE CENTRAL BOARD OF ASSESSMENT APPEALS WHICH
HELD THAT THE SUBJECT PROPERTIES ARE REAL PROPERTIES SUBJECT TO REAL
PROPERTY TAX; AND THAT ASSESSMENT ON THE SUBJECT PROPERTIES SHOULD BE
MADE TO TAKE EFFECT RETROACTIVELY FROM 1992 UNTIL 1997, WITH PENALTIES;
THE SAME BEING UNJUST, WHIMSICAL AND NOT IN ACCORD WITH THE LOCAL
GOVERNMENT CODE.

Ruling:

3
MERALCO argues that its transformers, electric posts, transmission lines, insulators,
and electric meters are not subject to real property tax, given that: (1) the definition
of "machinery" under Section 199(o) of the Local Government Code, on which real
property tax is imposed, must still be within the contemplation of real or immovable
property under Article 415 of the Civil Code because it is axiomatic that a statute
should be construed to harmonize with other laws on the same subject matter as to
form a complete, coherent, and intelligible system; (2) the Decision dated April 10,
1991 of the CBAA in CBAA Case No. 248, which affirmed the Decision dated July 5,
1989 of the LBAA in LBAA-89-2, ruling that the transformers, electric posts,
transmission lines, insulators, and electric meters of MERALCO are movable or
personal properties, is conclusive and binding; and (3) the electric poles are not
exclusively used to meet the needs of MERALCO alone since these are also being
utilized by other entities such as cable and telephone companies.

The transformers, electric posts,

transmission lines, insulators, and electric
meters of MERALCO may qualify as
"machinery" under the Local Government
Code subject to real property tax.

Through the years, the relevant laws have consistently considered "machinery" as
real property subject to real property tax. It is the definition of "machinery" that has
been changing and expanding.

MERALCO is a public utility engaged in electric distribution, and its transformers,

electric posts, transmission lines, insulators, and electric meters constitute the
physical facilities through which MERALCO delivers electricity to its consumers. Each
may be considered as one or more of the following: a
"machine,"48 "equipment,"49 "contrivance,"50 "instrument,"51 "appliance,"52 "apparatu
s,"53 or "installation."54

The Court highlights that under Section 199(o) of the Local Government Code,
machinery, to be deemed real property subject to real property tax, need no longer
be annexed to the land or building as these "may or may not be attached,
permanently or temporarily to the real property," and in fact, such machinery may
even be "mobile."55 The same provision though requires that to be machinery
subject to real property tax, the physical facilities for production, installations, and
appurtenant service facilities, those which are mobile, self-powered or self-
propelled, or not permanently attached to the real property (a) must be actually,
directly, and exclusively used to meet the needs of the particular industry, business,
or activity; and (2) by their very nature and purpose, are designed for, or necessary
for manufacturing, mining, logging, commercial, industrial, or agricultural purposes.
Thus, Article 290(o) of the Rules and Regulations Implementing the Local
Government Code of 1991 recognizes the following exemption: cralawlawlibrary

Machinery which are of general purpose use including but not limited to office
equipment, typewriters, telephone equipment, breakable or easily damaged
containers (glass or cartons), microcomputers, facsimile machines, telex machines,
cash dispensers, furnitures and fixtures, freezers, refrigerators, display cases or
racks, fruit juice or beverage automatic dispensing machines which are not directly
and exclusively used to meet the needs of a particular industry, business or activity

4
shall not be considered within the definition of machinery under this Rule. (Emphasis
supplied.) chanrobleslaw

The 1964 MERALCO case was decided when The Assessment Law was still in effect
and Section 3(f) of said law still required that the machinery be attached to the real
property. Moreover, as the Court pointed out earlier, the ruling in the 1964
MERALCO case  - that the electric poles (including the steel towers) of MERALCO are
not subject to real property tax - was primarily based on the express exemption
granted to MERALCO under its previous franchise.

Granting for the purpose of argument that the steel supports or towers in
question are not embraced within the term poles, the logical question
posited is whether they constitute real properties, so that they can be
subject to a real property tax. The tax law does not provide for a definition of
real property; but Article 415 of the Civil Code does, by stating the following are
immovable property: cralawlawlibrary

(1) Land, buildings, roads, and constructions of all kinds adhered to the soil; ChanRoblesVirtualawlibrary

x x x x

(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;ChanRoblesVirtualawlibrary

x x x x

(5) Machinery, receptacles, instruments or implements intended by the owner of the

tenement for an industry or works which may be carried in a building or on a piece
of land, and which tends directly to meet the needs of the said industry or works; ChanRoblesVirtualawlibrary

xxxx
The steel towers or supports in question, do not come within the objects mentioned
in paragraph 1, because they do not constitute buildings or constructions adhered to
the soil. They are not constructions analogous to buildings nor adhering to the soil.
As per description, given by the lower court, they are removable and merely
attached to a square metal frame by means of bolts, which when unscrewed could
easily be dismantled and moved from place to place. They can not be included under
paragraph 3, as they are not attached to an immovable in a fixed manner, and they
can be separated without breaking the material or causing deterioration upon the
object to which they are attached. Each of these steel towers or supports consists of
steel bars or metal strips, joined together by means of bolts, which can be
disassembled by unscrewing the bolts and reassembled by screwing the same.
These steel towers or supports do not also fall under paragraph 5, for they are not
machineries or receptacles, instruments or implements, and even if they were, they
are not intended for industry or works on the land. Petitioner is not engaged in an
industry or works on the land in which the steel supports or towers are
constructed.56 (Emphases supplied.) chanrobleslaw

The aforequoted conclusions of the Court in the 1964 MERALCO case do not hold

true anymore under the Local Government Code.

While the Local Government Code still does not provide for a specific definition of

5
"real property," Sections 199(o) and 232 of the said Code, respectively, gives an
extensive definition of what constitutes "machinery" and unequivocally subjects such
machinery to real property tax. The Court reiterates that the machinery subject to
real property tax under the Local Government Code "may or may not be attached,
permanently or temporarily to the real property;" and the physical facilities for
production, installations, and appurtenant service facilities, those which are mobile,
self-powered or self-propelled, or are not permanently attached must (a) be
actually, directly, and exclusively used to meet the needs of the particular industry,
business, or activity; and (2) by their very nature and purpose, be designed for, or
necessary for manufacturing, mining, logging, commercial, industrial, or agricultural
purposes.

Article 415, paragraph (1) of the Civil Code declares as immovables or real
properties "[l]and, buildings, roads and constructions of all kinds adhered to the
soil." The land, buildings, and roads are immovables by nature "which cannot be
moved from place to place," whereas the constructions adhered to the soil are
immovables by incorporation "which are essentially movables, but are attached to
an immovable in such manner as to be an integral part thereof." 57 Article 415,
paragraph (3) of the Civil Code, referring to "[ejverything 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," are likewise immovables by
incorporation. In contrast, the Local Government Code considers as real property
machinery which "may or may not be attached, permanently or temporarily to the
real property," and even those which are "mobile."

Article 415, paragraph (5) of the Civil Code considers as immovables or real
properties "[machinery, receptacles, instruments or implements intended by the
owner of the tenement for an industry or works which may be carried on in a
building or on a piece of land, and which tend directly to meet the needs of the said
industry or works." The Civil Code, however, does not define "machinery."

The properties under Article 415, paragraph (5) of the Civil Code are immovables by
destination, or "those which are essentially movables, but by the purpose for which
they have been placed in an immovable, partake of the nature of the latter because
of the added utility derived therefrom."58 These properties, including machinery,
become immobilized if the following requisites concur: (a) they are placed in the
tenement by the owner of such tenement; (b) they are destined for use in the
industry or work in the tenement; and (c) they tend to directly meet the needs of
said industry or works.59 The first two requisites are not found anywhere in the Local
Government Code.

MERALCO insists on harmonizing the aforementioned provisions of the Civil Code

and the Local Government Code. The Court disagrees, however, for this would
necessarily mean imposing additional requirements for classifying machinery as real
property for real property tax purposes not provided for, or even in direct conflict
with, the provisions of the Local Government Code.

As between the Civil Code, a general law governing property and property relations,
and the Local Government Code, a special law granting local government units the
power to impose real property tax, then the latter shall prevail.

Capitol Wireless, Inc., v. Provincial Treasurer of Batangas, G.R. No. 180110, May 30 2016

Facts:

6
Petitioner Capitol Wireless Inc. (Capwire) is a Philippine corporation in the business
of providing international telecommunications services. 3 As such provider, Capwire
has signed agreements with other local and foreign telecommunications companies
covering an international network of submarine cable systems such as the Asia
Pacific Cable Network System (APCN) (which connects Australia, Thailand, Malaysia,
Singapore, Hong Kong, Taiwan, Korea, Japan, Indonesia and the Philippines); the
Brunei-Malaysia-Philippines Cable Network System (BMP-CNS), the Philippines-Italy
(SEA-ME-WE-3 CNS), and the Guam Philippines (GP-CNS) systems.4 The
agreements provide for co-ownership and other rights among the parties over the
network.5

Petitioner Capwire claims that it is co-owner only of the so-called "Wet Segment" of
the APCN, while the landing stations or terminals and Segment E of APCN located in
Nasugbu, Batangas are allegedly owned by the Philippine Long Distance Telephone
Corporation (PLDT).6 Moreover, it alleges that the Wet Segment is laid in
international, and not Philippine, waters.7

Capwire claims that as co-owner, it does not own any particular physical part of the
cable system but, consistent with its financial contributions, it owns the right to use
a certain capacity of the said system. 8 This property right is allegedly reported in its
financial books as "Indefeasible Rights in Cable Systems." 9

However, for loan restructuring purposes, Capwire claims that "it was required to
register the value of its right," hence, it engaged an appraiser to "assess the market
value of the international submarine cable system and the cost to Capwire."

In essence, the Provincial Assessor had determined that the submarine cable
systems described in Capwire's Sworn Statement of True Value of Real Properties
are taxable real property, a determination that was contested by Capwire in an
exchange of letters between the company and the public respondent. 12 The reason
cited by Capwire is that the cable system lies outside of Philippine territory, i.e., on
international waters.

On March 10, 2003, Capwire filed a Petition for Prohibition and Declaration of Nullity
of Warrant of Levy, Notice of Auction Sale and/or Auction Sale with the Regional
Trial Court (RTC) of Batangas City.

Issue:

May submarine communications cables be classified as taxable real property by the

local governments?

Ruling:

We hold in the affirmative.

7
Submarine or undersea communications cables are akin to electric transmission lines
which this Court has recently declared in  Manila Electric Company v. City Assessor
and City Treasurer of Lucena City,37 as "no longer exempted from real property tax"
and may qualify as "machinery" subject to real property tax under the Local
Government Code. To the extent that the equipment's location is determinable to be
within the taxing authority's jurisdiction, the Court sees no reason to distinguish
between submarine cables used for communications and aerial or underground wires
or lines used for electric transmission, so that both pieces of property do not merit a
different treatment in the aspect of real property taxation. Both electric lines and
communications cables, in the strictest sense, are not directly adhered to the soil
but pass through posts, relays or landing stations, but both may be classified under
the term "machinery" as real property under Article 415(5) 38 of the Civil Code for
the simple reason that such pieces of equipment serve the owner's business or tend
to meet the needs of his industry or works that are on real estate. Even objects in or
on a body of water may be classified as such, as "waters" is classified as an
immovable under Article 415(8)39 of the Code. A classic example is a boathouse
which, by its nature, is a vessel and, therefore, a personal property but, if it is tied
to the shore and used as a residence, and since it floats on waters which is
immovable, is considered real property. 40 Besides, the Court has already held that
"it is a familiar phenomenon to see things classed as real property for purposes of
taxation which on general principle might be considered personal property." 41

Thus, absent any showing from Capwire of any express grant of an exemption for its
lines and cables from real property taxation, then this interpretation applies and
Capwire's submarine cable may be held subject to real property tax.

Heirs of Malabanan v. Republic, G.R. No. 179987, 3 September 2013

Facts:

8
The property subject of the application for registration is a parcel of land situated in Barangay
Tibig, Silang Cavite, more particularly identified as Lot 9864-A, Cad-452-D, with an area of
71,324-square meters. On February 20, 1998, applicant Mario Malabanan, who had purchased
the property from Eduardo Velazco, filed an application for land registration covering the property
in the Regional Trial Court (RTC) in Tagaytay City, Cavite, claiming that the property formed part
of the alienable and disposable land of the public domain, and that he and his predecessors-in-
interest had been in open, continuous, uninterrupted, public and adverse possession and
occupation of the land for more than 30 years, thereby entitling him to the judicial confirmation of
his title.1

To prove that the property was an alienable and disposable land of the public domain,
Malabanan presented during trial a certification dated June 11, 2001 issued by the Community
Environment and Natural Resources Office (CENRO) of the Department of Environment and
Natural Resources (DENR).

Issue:

Petitioners argue that the reclassification of the land as alienable or disposable opened it to
acquisitive prescription under the Civil Code; that Malabanan had purchased the property from
Eduardo Velazco believing in good faith that Velazco and his predecessors-in-interest had been
the real owners of the land with the right to validly transmit title and ownership thereof; that
consequently, the ten-year period prescribed by Article 1134 of the Civil Code, in relation to
Section 14(2) of the Property Registration Decree, applied in their favor; and that when
Malabanan filed the application for registration on February 20, 1998, he had already been in
possession of the land for almost 16 years reckoned from 1982, the time when the land was
declared alienable and disposable by the State.

Ruling:

Classifications of land according to ownership

Land, which is an immovable property,10 may be classified as either of public dominion or of

private ownership.11 Land is considered of public dominion if it either: (a) is intended for public
use; or (b) belongs to the State, without being for public use, and is intended for some public
service or for the development of the national wealth. 12 Land belonging to the State that is not of
such character, or although of such character but no longer intended for public use or for public
service forms part of the patrimonial property of the State. 13 Land that is other than part of the
patrimonial property of the State, provinces, cities and municipalities is of private ownership if it
belongs to a private individual.

Pursuant to the Regalian Doctrine (Jura Regalia), a legal concept first introduced into the country
from the West by Spain through the Laws of the Indies and the Royal Cedulas, 14 all lands of the
public domain belong to the State.15 This means that the State is the source of any asserted right
to ownership of land, and is charged with the conservation of such patrimony. 16

All lands not appearing to be clearly under private ownership are presumed to belong to the
State. Also, public lands remain part of the inalienable land of the public domain unless the State
is shown to have reclassified or alienated them to private persons. 17

Classifications of public lands

according to alienability

9
Whether or not land of the public domain is alienable and disposable primarily rests on the
classification of public lands made under the Constitution. Under the 1935 Constitution, 18 lands of
the public domain were classified into three, namely, agricultural, timber and mineral. 19 Section
10, Article XIV of the 1973 Constitution classified lands of the public domain into seven,
specifically, agricultural, industrial or commercial, residential, resettlement, mineral, timber or
forest, and grazing land, with the reservation that the law might provide other classifications. The
1987 Constitution adopted the classification under the 1935 Constitution into agricultural, forest
or timber, and mineral, but added national parks.20 Agricultural lands may be further classified by
law according to the uses to which they may be devoted. 21 The identification of lands according to
their legal classification is done exclusively by and through a positive act of the Executive
Department.22

Based on the foregoing, the Constitution places a limit on the type of public land that may be
alienated. Under Section 2, Article XII of the 1987 Constitution, only agricultural lands of the
public domain may be alienated; all other natural resources may not be.

Alienable and disposable lands of the State fall into two categories, to wit: (a) patrimonial lands of
the State, or those classified as lands of private ownership under Article 425 of the Civil
Code,23 without limitation; and (b) lands of the public domain, or the public lands as provided by
the Constitution, but with the limitation that the lands must only be agricultural. Consequently,
lands classified as forest or timber, mineral, or national parks are not susceptible of alienation or
disposition unless they are reclassified as agricultural. 24 A positive act of the Government is
necessary to enable such reclassification,25 and the exclusive prerogative to classify public lands
under existing laws is vested in the Executive Department, not in the courts. 26 If, however, public
land will be classified as neither agricultural, forest or timber, mineral or national park, or when
public land is no longer intended for public service or for the development of the national wealth,
thereby effectively removing the land from the ambit of public dominion, a declaration of such
conversion must be made in the form of a law duly enacted by Congress or by a Presidential
proclamation in cases where the President is duly authorized by law to that effect. 27 Thus, until
the Executive Department exercises its prerogative to classify or reclassify lands, or until
Congress or the President declares that the State no longer intends the land to be used for public
service or for the development of national wealth, the Regalian Doctrine is applicable.

Disposition of alienable public lands

Section 11 of the Public Land Act (CA No. 141) provides the manner by which alienable and
disposable lands of the public domain, i.e., agricultural lands, can be disposed of, to wit:

Note that Section 48(b) of the Public Land Act used the words "lands of the public domain" or
"alienable and disposable lands of the public domain" to clearly signify that lands otherwise
classified, i.e., mineral, forest or timber, or national parks, and lands of patrimonial or private
ownership, are outside the coverage of the Public Land Act. What the law does not include, it
excludes. The use of the descriptive phrase "alienable and disposable" further limits the
coverage of Section 48(b) to only the agricultural lands of the public domain as set forth in Article
XII, Section 2 of the 1987 Constitution. Bearing in mind such limitations under the Public Land
Act, the applicant must satisfy the following requirements in order for his application to come
under Section 14(1) of the Property Registration Decree, 28 to wit:

Taking into consideration that the Executive Department is vested with the authority to classify
lands of the public domain, Section 48(b) of the Public Land Act, in relation to Section 14(1) of
the Property Registration Decree, presupposes that the land subject of the application for
registration must have been already classified as agricultural land of the public domain in order
for the provision to apply. Thus, absent proof that the land is already classified as agricultural
land of the public domain, the Regalian Doctrine applies, and overcomes the presumption that

10
the land is alienable and disposable as laid down in Section 48(b) of the Public Land Act.
However, emphasis is placed on the requirement that the classification required by Section 48(b)
of the Public Land Act is classification or reclassification of a public land as agricultural.

The dissent stresses that the classification or reclassification of the land as alienable and
disposable agricultural land should likewise have been made on June 12, 1945 or earlier,
because any possession of the land prior to such classification or reclassification produced no
legal effects. It observes that the fixed date of June 12, 1945 could not be minimized or glossed
over by mere judicial interpretation or by judicial social policy concerns, and insisted that the full
legislative intent be respected.

We find, however, that the choice of June 12, 1945 as the reckoning point of the requisite
possession and occupation was the sole prerogative of Congress, the determination of which
should best be left to the wisdom of the lawmakers. Except that said date qualified the period of
possession and occupation, no other legislative intent appears to be associated with the fixing of
the date of June 12, 1945. Accordingly, the Court should interpret only the plain and literal
meaning of the law as written by the legislators.

Moreover, an examination of Section 48(b) of the Public Land Act indicates that Congress
prescribed no requirement that the land subject of the registration should have been classified as
agricultural since June 12, 1945, or earlier. As such, the applicant’s imperfect or incomplete title
is derived only from possession and occupation since June 12, 1945, or earlier. This means that
the character of the property subject of the application as alienable and disposable agricultural
land of the public domain determines its eligibility for land registration, not the ownership or title
over it.

Alienable public land held by a possessor, either personally or through his predecessors-in-
interest, openly, continuously and exclusively during the prescribed statutory period is converted
to private property by the mere lapse or completion of the period. 29 In fact, by virtue of this
doctrine, corporations may now acquire lands of the public domain for as long as the lands were
already converted to private ownership, by operation of law, as a result of satisfying the requisite
period of possession prescribed by the Public Land Act.30 It is for this reason that the property
subject of the application of Malabanan need not be classified as alienable and disposable
agricultural land of the public domain for the entire duration of the requisite period of possession.

To be clear, then, the requirement that the land should have been classified as alienable and
disposable agricultural land at the time of the application for registration is necessary only to
dispute the presumption that the land is inalienable.

The declaration that land is alienable and disposable also serves to determine the point at which
prescription may run against the State. The imperfect or incomplete title being confirmed under
Section 48(b) of the Public Land Act is title that is acquired by reason of the applicant’s
possession and occupation of the alienable and disposable agricultural land of the public
domain. Where all the necessary requirements for a grant by the Government are complied with
through actual physical, open, continuous, exclusive and public possession of an alienable and
disposable land of the public domain, the possessor is deemed to have acquired by operation of
law not only a right to a grant, but a grant by the Government, because it is not necessary that a
certificate of title be issued in order that such a grant be sanctioned by the courts. 31

If one follows the dissent, the clear objective of the Public Land Act to adjudicate and quiet titles
to unregistered lands in favor of qualified Filipino citizens by reason of their occupation and
cultivation thereof for the number of years prescribed by law 32 will be defeated. Indeed, we should
always bear in mind that such objective still prevails, as a fairly recent legislative development
bears out, when Congress enacted legislation (Republic Act No. 10023) 33 in order to liberalize
stringent requirements and procedures in the adjudication of alienable public land to qualified
applicants, particularly residential lands, subject to area limitations. 34

11
On the other hand, if a public land is classified as no longer intended for public use or for the
development of national wealth by declaration of Congress or the President, thereby converting
such land into patrimonial or private land of the State, the applicable provision concerning
disposition and registration is no longer Section 48(b) of the Public Land Act but the Civil Code,
in conjunction with Section 14(2) of the Property Registration Decree. 35 As such, prescription can
now run against the State.

To sum up, we now observe the following rules relative to the disposition of public land or lands
of the public domain, namely:

(1) As a general rule and pursuant to the Regalian Doctrine, all lands of the public
domain belong to the State and are inalienable. Lands that are not clearly under private
ownership are also presumed to belong to the State and, therefore, may not be alienated
or disposed;

(2) The following are excepted from the general rule, to wit:

(a) Agricultural lands of the public domain are rendered alienable and disposable
through any of the exclusive modes enumerated under Section 11 of the Public
Land Act. If the mode is judicial confirmation of imperfect title under Section 48(b)
of the Public Land Act, the agricultural land subject of the application needs only
to be classified as alienable and disposable as of the time of the application,
provided the applicant’s possession and occupation of the land dated back to
June 12, 1945, or earlier. Thereby, a conclusive presumption that the applicant
has performed all the conditions essential to a government grant arises, 36 and the
applicant becomes the owner of the land by virtue of an imperfect or incomplete
title. By legal fiction, the land has already ceased to be part of the public domain
and has become private property.37

(b) Lands of the public domain subsequently classified or declared as no longer

intended for public use or for the development of national wealth are removed
from the sphere of public dominion and are considered converted into patrimonial
lands or lands of private ownership that may be alienated or disposed through
any of the modes of acquiring ownership under the Civil Code. If the mode of
acquisition is prescription, whether ordinary or extraordinary, proof that the land
has been already converted to private ownership prior to the requisite acquisitive
prescriptive period is a condition sine qua non in observance of the law (Article
1113, Civil Code) that property of the State not patrimonial in character shall not
be the object of prescription.

To reiterate, then, the petitioners failed to present sufficient evidence to establish that they and
their predecessors-in-interest had been in possession of the land since June 12, 1945. Without
satisfying the requisite character and period of possession - possession and occupation that is
open, continuous, exclusive, and notorious since June 12, 1945, or earlier - the land cannot be
considered ipso jure converted to private property even upon the subsequent declaration of it as
alienable and disposable. Prescription never began to run against the State, such that the land
has remained ineligible for registration under Section 14(1) of the Property Registration Decree.
Likewise, the land continues to be ineligible for land registration under Section 14(2) of the
Property Registration Decree unless Congress enacts a law or the President issues a
proclamation declaring the land as no longer intended for public service or for the development
of the national wealth.
1â

12
Republic v. Santos, III, G.R. No. 160453, November 12, 2012

By law, accretion - the gradual and imperceptible deposit made through the effects of the current
of the water- belongs to the owner of the land adjacent to the banks of rivers where it forms. The
drying up of the river is not accretion. Hence, the dried-up river bed belongs to the State as

13
property of public dominion, not to the riparian owner, unless a law vests the ownership in some
other person.

Facts:

Alleging continuous and adverse possession of more than ten years, respondent Arcadio Ivan A.
Santos III (Arcadio Ivan) applied on March 7, 1997 for the registration of Lot 4998-B (the
property) in the Regional Trial Court (RTC) in Parafiaque City. The property, which had an area
of 1,045 square meters, more or less, was located in Barangay San Dionisio, Parañaque City,
and was bounded in the Northeast by Lot 4079 belonging to respondent Arcadio C. Santos, Jr.
(Arcadio, Jr.), in the Southeast by the Parañaque River, in the Southwest by an abandoned road,
and in the Northwest by Lot 4998-A also owned by Arcadio Ivan. 1

On May 21, 1998, Arcadio Ivan amended his application for land registration to include Arcadio,
Jr. as his co-applicant because of the latter’s co-ownership of the property. He alleged that the
property had been formed through accretion and had been in their joint open, notorious, public,
continuous and adverse possession for more than 30 years. 2

The City of Parañaque (the City) opposed the application for land registration, stating that it
needed the property for its flood control program; that the property was within the legal easement
of 20 meters from the river bank; and that assuming that the property was not covered by the
legal easement, title to the property could not be registered in favor of the applicants for the
reason that the property was an orchard that had dried up and had not resulted from accretion.

Issue:

THE TRIAL COURT ERRED IN RULING THAT THE PROPERTY SOUGHT TO BE

REGISTERED IS AN ACCRETION TO THE ADJOINING PROPERTY OWNED BY APPELLEES
DESPITE THE ADMISSION OF APPELLEE ARCADIO C. SANTOS JR. THAT THE SAID
PROPERTY WAS NOT FORMED AS A RESULT OF THE GRADUAL FILLING UP OF SOIL
THROUGH THE CURRENT OF THE RIVER.

Ruling:

The CA grossly erred in applying Article 457 of the Civil Code to respondents’ benefit

Article 457 of the Civil Code provides that "(t)o the owners of lands adjoining the banks of rivers
belong the accretion which they gradually receive from the effects of the currents of the waters."

In ruling for respondents, the RTC pronounced as follows:

On the basis of the evidence presented by the applicants, the Court finds that Arcadio Ivan A.
Santos III and Arcadio C. Santos, Jr., are the owners of the land subject of this application which
was previously a part of the Parañaque River which became an orchard after it dried up and
further considering that Lot 4 which adjoins the same property is owned by applicant, Arcadio C.
Santos, Jr., after it was obtained by him through inheritance from his mother, Concepcion Cruz,
now deceased. Conformably with Art. 457 of the New Civil Code, it is provided that:

14
"Article 457. To the owners of the lands adjoining the bank of rivers belong the accretion which
they gradually receive from the effects of the current of the waters."

The Republic’s submission is correct.

Respondents as the applicants for land registration carried the burden of proof to establish the
merits of their application by a preponderance of evidence, by which is meant such evidence that
is of greater weight, or more convincing than that offered in opposition to it. They would be held
11 

entitled to claim the property as their own and apply for its registration under the Torrens system
only if they established that, indeed, the property was an accretion to their land.

Accretion is the process whereby the soil is deposited along the banks of rivers. The deposit of
12 

soil, to be considered accretion, must be: (a) gradual and imperceptible; (b) made through the
effects of the current of the water; and (c) taking place on land adjacent to the banks of rivers.13

Accordingly, respondents should establish the concurrence of the elements of accretion to

warrant the grant of their application for land registration.

However, respondents did not discharge their burden of proof. They did not show that the
gradual and imperceptible deposition of soil through the effects of the current of the river had
formed Lot 4998-B. Instead, their evidence revealed that the property was the dried-up river bed
of the Parañaque River, leading both the RTC and the CA to themselves hold that Lot 4998-B
was "the land which was previously part of the Parañaque River xxx (and) became an orchard
after it dried up."

Still, respondents argue that considering that Lot 4998-B did not yet exist when the original title of
Lot 4 was issued in their mother’s name in 1920, and that Lot 4998-B came about only thereafter
as the land formed between Lot 4 and the Parañaque River, the unavoidable conclusion should
then be that soil and sediments had meanwhile been deposited near Lot 4 by the current of the
Parañaque River, resulting in the formation of Lot 4998-B.

The argument is legally and factually groundless. For one, respondents thereby ignore that the
effects of the current of the river are not the only cause of the formation of land along a river
bank. There are several other causes, including the drying up of the river bed. The drying up of
the river bed was, in fact, the uniform conclusion of both lower courts herein. In other words,
respondents did not establish at all that the increment of land had formed from the gradual and
imperceptible deposit of soil by the effects of the current. Also, it seems to be highly improbable
that the large volume of soil that ultimately comprised the dry land with an area of 1,045 square
meters had been deposited in a gradual and imperceptible manner by the current of the river in
the span of about 20 to 30 years – the span of time intervening between 1920, when Lot 4 was
registered in the name of their deceased parent (at which time Lot 4998-B was not yet in
existence) and the early 1950s (which respondents’ witness Rufino Allanigue alleged to be the
time when he knew them to have occupied Lot 4988-B). The only plausible explanation for the
substantial increment was that Lot 4988-B was the dried-up bed of the Parañaque River.
Confirming this explanation was Arcadio, Jr.’s own testimony to the effect that the property was
previously a part of the Parañaque River that had dried up and become an orchard.

We observe in this connection that even Arcadio, Jr.’s own Transfer Certificate of Title No. 44687
confirmed the uniform conclusion of the RTC and the CA that Lot 4998-B had been formed by
the drying up of the Parañaque River. Transfer Certificate of Title No. 44687 recited that Lot 4 of
the consolidated subdivision plan Pcs-13-002563, the lot therein described, was bounded "on the
SW along line 5-1 by Dried River Bed." 14

15
That boundary line of "SW along line 5-1" corresponded with the location of Lot 4998-B, which
was described as "bounded by Lot 4079 Cad. 299, (Lot 1, Psu-10676), in the name of
respondent Arcadio Santos, Jr. (Now Lot 4, Psd-13-002563) in the Northeast." 15

The RTC and the CA grossly erred in treating the dried-up river bed as an accretion that became
respondents’ property pursuant to Article 457 of the Civil Code. That land was definitely not an
accretion. The process of drying up of a river to form dry land involved the recession of the water
level from the river banks, and the dried-up land did not equate to accretion, which was the
gradual and imperceptible deposition of soil on the river banks through the effects of the current.
In accretion, the water level did not recede and was more or less maintained. Hence,
respondents as the riparian owners had no legal right to claim ownership of Lot 4998-B.
Considering that the clear and categorical language of Article 457 of the Civil Code has confined
the provision only to accretion, we should apply the provision as its clear and categorical
language tells us to. Axiomatic it is, indeed, that where the language of the law is clear and
categorical, there is no room for interpretation; there is only room for application. The first and
16 

fundamental duty of courts is then to apply the law. 17

The State exclusively owned Lot 4998-B and may not be divested of its right of ownership. Article
502 of the Civil Code expressly declares that rivers and their natural beds are public dominion of
the State. It follows that the river beds that dry up, like Lot 4998-B, continue to belong to the
18 

State as its property of public dominion, unless there is an express law that provides that the
dried-up river beds should belong to some other person.

Article 419 of the Civil Code distinguishes property as being either of public dominion or of
private ownership. Article 420 of the Civil Code lists the properties considered as part of public
dominion, namely: (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;
and (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. As earlier mentioned, Article 502 of
the Civil Code declares that rivers and their natural beds are of public dominion.

Whether the dried-up river bed may be susceptible to acquisitive prescription or not was a
question that the Court resolved in favor of the State in Celestial v. Cachopero, a case involving
29 

the registration of land found to be part of a dried-up portion of the natural bed of a creek. There
the Court held:

As for petitioner’s claim of ownership over the subject land, admittedly a dried-up bed of the
Salunayan Creek, based on (1) her alleged long term adverse possession and that of her
predecessor-in-interest, Marcelina Basadre, even prior to October 22, 1966, when she
purchased the adjoining property from the latter, and (2) the right of accession under Art. 370 of
the Spanish Civil Code of 1889 and/or Article 461 of the Civil Code, the same must fail.

Since property of public dominion is outside the commerce of man and not susceptible to private
appropriation and acquisitive prescription, the adverse possession which may be the basis of a
grant of title in the confirmation of an imperfect title refers only to alienable or disposable portions
of the public domain. It is only after the Government has declared the land to be alienable and
disposable agricultural land that the year of entry, cultivation and exclusive and adverse
possession can be counted for purposes of an imperfect title.

Indeed, under the Regalian doctrine, all lands not otherwise appearing to be clearly within private
ownership are presumed to belong to the State. No public land can be acquired by private
30 

persons without any grant, express or implied, from the Government. It is indispensable,
therefore, that there is a showing of a title from the State. Occupation of public land in the
31 

concept of owner, no matter how long, cannot ripen into ownership and be registered as a title. 32

16
Subject to the exceptions defined in Article 461 of the Civil Code (which declares river beds that
are abandoned through the natural change in the course of the waters as ipso facto belonging to
the owners of the land occupied by the new course, and which gives to the owners of the
adjoining lots the right to acquire only the abandoned river beds not ipso facto belonging to the
owners of the land affected by the natural change of course of the waters only after paying their
value), all river beds remain property of public dominion and cannot be acquired by acquisitive
prescription unless previously declared by the Government to be alienable and disposable.
Considering that Lot 4998-B was not shown to be already declared to be alienable and
disposable, respondents could not be deemed to have acquired the property through
prescription.

Nonetheless, respondents insist that the property was already classified as alienable and
disposable by the Government. They cite as proof of the classification as alienable and
disposable the following notation found on the survey plan.

For the original registration of title, the applicant (petitioners in this case) must overcome the
presumption that the land sought to be registered forms part of the public domain. Unless public
land is shown to have been reclassified or alienated to a private person by the State, it remains
part of the inalienable public domain. Indeed, "occupation thereof in the concept of owner, no
matter how long, cannot ripen into ownership and be registered as a title." To overcome such
presumption, incontrovertible evidence must be shown by the applicant. Absent such evidence,
the land sought to be registered remains inalienable.

In the present case, petitioners cite a surveyor-geodetic engineer’s notation in Exhibit "E"
indicating that the survey was inside alienable and disposable land. Such notation does not
constitute a positive government act validly changing the classification of the land in question.
Verily, a mere surveyor has no authority to reclassify lands of the public domain. By relying solely
on the said surveyor’s assertion, petitioners have not sufficiently proven that the land in question
has been declared alienable. (Emphasis supplied)

Navy Officers’ Village Association, Inc. v. Republic, G.R. No. 177168, 3 August 2015

Facts:

17
TCT No. T-15387,5 issued in NOVAI's name, covers a 475,009 square-meter parcel
of land (the property)6 situated inside the former Fort Andres Bonifacio Military
Reservation (FBMR) in Taguig, Metro Manila.

The property previously formed part of a larger 15,812,684 square-meter parcel of

land situated at the former Fort William McKinley, Rizal, which was covered by TCT
No. 61524 issued in the name of the Republic of the Philippines.

On July 12, 1957, then President Carlos P. Garcia issued Proclamation No.

4237 "reserving for military purposes certain parcels of the public domain situated in
the municipalities of Pasig, Taguig, Parañaque, province of Rizal, and Pasay City,"
which included the 15,812,684 square-meter parcel of land covered by TCT No.
61524.

On September 29, 1965, then Pres. Diosdado Macapagal issued Proclamation No.

4618 which excluded from Fort McKinley "a certain portion of land embraced therein,
situated in the municipalities of Taguig and Parañaque, Province of Rizal, and Pasay
City," with an area of 2,455,310 square meters, and declared the excluded area as
"AFP Officers' Village" to be disposed of under the provisions of Republic Act Nos.
2749 and 730.10 cralawrednad

Barely a month after, or on October 25, 1965, Pres. Macapagal

issued Proclamation No. 47811 "reserving for the veterans rehabilitation, medicare
and training center site purposes" an area of 537,520 square meters of the land
previously declared as AFP Officers' Village under Proclamation No. 461, and placed
the reserved area under the administration of the Veterans Federation of the
Philippines (VFP).

The property is within the 537,520 square-meter parcel of land reserved in VFP's
favor.

On November 15, 1991, the property was the subject of a Deed of

Sale12between the Republic of the Philippines, through former Land
Management Bureau (LMB) Director Abelardo G. Palad, Jr., (Dir. Palad) and
petitioner NOVAI. The deed of sale was subsequently registered and from
which TCT No. T-15387 was issued in NOVAI's name.

Issue:

NOVAI alleges that the CA erred in declaring that: (a) the property is inalienable
land of the public domain,

Ruling:

A. The property is non-disposable land of the public domain reserved for

public or quasi-public use or purpose

18
 We agree with the CA that the property remains a part of the public domain
that could not have been validly disposed of in NOVAI's favor. NOVAI failed to
discharge its burden of proving that the property was withdrawn from the
intended public or quasi-public use or purpose.

While the parties disagree on the character and nature of the property at the
time of the questioned sale, they agree, however, that the property formed
part of the FBMR - a military reservation belonging to the public domain. We
note that the FBMR has been the subject of several presidential proclamations
and statues issued subsequent to Proclamation No. 423, which either
removed or reserved for specific public or quasi-public use or purpose certain
of its portions.

On the one hand, NOVAI argues that Proclamation No. 461 had already
transferred the property from the State's "public domain" to its "private
domain." On the other hand, the respondents argue that Proclamation No.
478, in relation with RA 7227 and EO No. 40, had reverted the property to
the inalienable property of the "public domain."

The classification and disposition of lands of the public domain are governed
by Commonwealth Act (C.A.) No. 141 or the Public Land Act, the country's
primary law on the matter.

Under Section 6 of C.A. No. 141, the President of the Republic of the
Philippines, upon the recommendation of the Secretary of Agriculture and
Natural Resources, may, from time to time, classify lands of the public
domain into alienable or disposable, timber and mineral lands,
and transfer these lands from one class to another for purposes of their
administration and disposition.

Under Section 7 of C.A. No. 141, the President may, from time to time, upon
recommendation of the Secretary of Agriculture and Natural Resources and
for purposes of the administration and disposition of alienable and disposable
public lands, declare what lands are open to disposition or concession under
the Acts' provisions.33
cralawrednad

Section 8 of C.A. No. 141 sets out the public lands open to disposition or
concession and the requirement that they have been officially delimited and
classified, and when practicable, surveyed. Section 8 excludes (by
implication) from disposition or concession, public lands which have been
reserved for public or quasi-public uses; appropriated by the Government; or
in any manner have become private property, or those on which a private
right authorized and recognized by the Act or any other valid law may be
claimed. Further, Section 8 authorizes the President to suspend the
concession or disposition of lands previously declared open to disposition,
until again declared open to disposition by his proclamation or by act of
Congress.

Lands of the public domain classified as alienable and disposable are further
classified, under Section 9 of C.A. No. 141, according to their use or purpose
into: (1) agricultural; (2) residential, commercial, industrial, or for similar
productive purposes; (3) educational, charitable, or other similar purposes; and

19
(4) reservations for townsites and for public and quasi-public uses. Section 9 also
authorizes the President to make the classifications and, at any time, transfer
lands from one class to another.

Section 83 of C.A. No. 141 defines public domain lands classified as

reservations for public and quasi-public uses as "any tract or tracts of land
of the public domain" which the President, by proclamation and upon
recommendation of the Secretary of Agriculture and Natural Resources,
may designate "as reservations for the use of the Republic of the Philippines or
any of its branches, or of the inhabitants thereof or "for quasi-public uses or
purposes when the public interest requires it."34 Under Section 88 of the same
Act, these "reserved tract or tracts of lands shall be non-alienable and
shall not be subject to occupation, entry, sale, lease or other disposition
until again declared alienable under the provisions of [CA No. 141] or by
proclamation of the President."35 cralawrednad

As these provisions operate, the President may classify lands of the public
domain as alienable and disposable, mineral or timber land, and transfer such
lands from one class to another at any time.

Within the class of alienable and disposable lands of the public domain, the
President may further classify public domain lands, according to the use or
purpose to which they are destined, as agricultural: residential, commercial,
industrial, etc.; educational, charitable, etc.; and reservations for townsites and
for public and quasi-public uses; and, he may transfer such lands from one class
to the other at any time.

Thus, the President may, for example, transfer a certain parcel of land from its
classification as agricultural (under Section 9 [a]), to residential, commercial,
industrial, or for similar purposes (under Section 9 [b]) and declare it available
for disposition under any of the modes of disposition of alienable and disposable
public lands available under C.A. No. 141, as amended.

The modes of disposition of alienable and disposable lands available under C.A.
No. 141 include: (1) by homestead settlement (Chapter IV), by sale (Chapter V),
by lease (Chapter VI) and by confirmation of imperfect or incomplete titles
(Chapters VII and VIII) for agricultural lands under Title II of C.A. No. 141 as
amended; (2) by sale or by lease for residential, commercial, or industrial lands
under Title III of C.A. No. 141, as amended; (3) by donation, sale, lease,
exchange or any other form for educational and charitable lands under Title IV of
C.A. No. 141, as amended; and (4) by sale by public auction for townsite
reservations under Chapter XI, Title V of C.A. No. 141, as amended.

Once these parcels of lands are actually acquired by private persons, either by
sale, grant, or other modes of disposition, they are removed from the mass of
land of the public domain and become, by operation of law, their private
property.

With particular regard, however, to parcels of land classified as reservations for

public and quasi-public uses (under Section 9 [d]), when the President transfers
them to the class of .alienable and disposable public domain lands destined for
residential, commercial, industrial, or for similar purposes (under Section 9 [b]),
or some other class under Section 9, these reserved public domain lands become
available for disposition under any of the available modes of disposition under

20
C.A. No. 141, as provided above. Once these re-classified lands (to residential
purposes from reservation for public and quasi-public uses) are actually acquired
by private persons, they become private property.

In the meantime, however, and until the parcels of land are actually granted to,
acquired, or purchased by private persons, they remain lands of the public
domain which the President, under Section 9 of C.A. No. 141, may classify again
as reservations for public and quasi-public uses. The President may also, under
Section 8 of C.A. No. 141, suspend their concession or disposition.

If these parcels of land are re-classified as reservations before they are actually
acquired by private persons, or if the President suspends their concession or
disposition, they shall not be subject to occupation, entry, sale, lease, or other
disposition until again declared open for disposition by proclamation of the
President pursuant to Section 88 in relation with Section 8 of C.A. No. 141.

Thus, in a limited sense, parcels of land classified as reservations for public or

quasi-public uses under Section 9 (d) of C.A. No. 141 are still non-alienable and
non-disposable, even though they are, by the general classification under Section
6, alienable and disposable lands of the public domain. By specific declaration
under Section 88, in relation with Section 8, these lands classified as
reservations are non-alienable and non-disposable.

In short, parcels of land classified as reservations for public or quasi-public uses:

(1) are non-alienable and non-disposable in view of Section 88 (in relation with
Section 8) of CA No. 141 specifically declaring them as non-alienable and not
subject to disposition; and (2) they remain public domain lands until they are
actually disposed of in favor of private persons.

Complementing and reinforcing this interpretation - that lands designated as

reservations for public and quasi-public uses are non-alienable and non-
disposable and retain their character as land of the public domain is the Civil
Code with its provisions on Property that deal with lands in general. We find
these provisions significant to our discussion and interpretation as lands are
property, whether they are public lands or private lands. 36 cralawrednad

In this regard, Article 419 of the Civil Code classifies property as either of public
dominion or of private ownership. Article 420 37 defines property of the public
dominion as those which are intended for public use or, while not intended for
public use, belong to the State and are intended for some public service. Article
421, on the other hand, defines patrimonial property as all other property of the
State which is not of the character stated in Article 420. While Article 422 states
that public dominion property which is no longer intended for public use or
service shall form part of the State's patrimonial property.

Thus, from the perspective of the general Civil Code provisions on Property,
lands which are intended for public use or public service such as reservations for
public or quasi-public uses are property of the public dominion and remain to be
so as long as they remain reserved.

As property of the public dominion, public lands reserved for public or quasi-
public uses are outside the commerce of man.38 They cannot be subject to sale,

21
 disposition or encumbrance; any sale, disposition or encumbrance of such
property of the public dominion is void for being contrary to law and public
policy.39
cralawrednad

To be subject to sale, occupation or other disposition, lands of the public domain

designated as reservations must first be withdrawn, by act of Congress or by
proclamation of the President, from the public or quasi-public use for which it has
been reserved or otherwise positively declared to have been converted to
patrimonial property, pursuant to Sections 8 and 88 of C.A. No. 141 and Article
422 of the Civil Code.40 Without such express declaration or positive
governmental act, the reserved public domain lands remain to be public
dominion property of the State.41 cralawrednad

To summarize our discussion: ChanRoblesvirtualLawlibrary

(1) Lands of the public domain classified as reservations for public or quasi-public
uses are non-alienable and shall not be subject to disposition, although they are,
by the general classification under Section 6 of C.A. No. 141, alienable and
disposable lands of the public domain, until declared open for disposition by
proclamation of the President; and

(2) Lands of the public domain classified as reservations are property of the
public dominion; they remain to be property of the public dominion until
withdrawn from the public or quasi-public use for which they have been
reserved, by act of Congress or by proclamation of the President, or otherwise
positively declared to have been converted to patrimonial property.

Based on these principles, we now examine the various issuances affecting the
property in order to determine the property's character and nature, i.e., whether
the property remains public domain property of the State or has become its
private property.

City of Lapu-Lapu v. PEZA, G.R. Nos. 184203, 187583, November 26, 2014;

Facts:

22
In the exercise of his legislative powers,  President Ferdinand E. Marcos issued Presidential
6

Decree No. 66 in 1972, declaring as government policy the establishment of export processing
zones in strategic locations in the Philippines. Presidential Decree No. 66 aimed "to encourage
and promote foreign commerce as a means of making the Philippines a center of international
trade, of strengthening our export trade and foreign exchange position, of hastening
industrialization,of reducing domestic unemployment, and of accelerating the development of the
country." 7

To carry out this policy, the Export Processing Zone Authority (EPZA) was created to operate,
administer, and manage the export processing zones established in the Port of Mariveles,
Bataan  and such other export processing zones that may be created by virtue of the decree.
8 9

The decree declared the EPZA non-profit in character  with all its revenues devoted to its
10

development, improvement, and maintenance.  To maintain this non-profit character, the EPZA
11

was declared exempt from all taxes that may be due to the Republic of the Philippines, its
provinces, cities, municipalities, and other government agencies and
instrumentalities.  Specifically, Section 21 of Presidential Decree No. 66 declared the EPZA
12

exempt from payment of real property taxes:

In 1979, President Marcos issued Proclamation No. 1811, establishing the Mactan Export
Processing Zone. Certain parcels of land of the public domain located in the City of Lapu-Lapuin
Mactan, Cebu were reserved to serve as site of the Mactan Export Processing Zone.

In 1995, the PEZA was created by virtue of Republic Act No. 7916 or "the Special Economic
Zone Act of 1995"  to operate, administer, manage, and develop economic zones in the
13

country.  The PEZA was granted the power to register, regulate, and supervise the enterprises
14

located in the economic zones.  By virtue of the law, the export processing zone in Mariveles,
15

Bataan became the Bataan Economic Zone  and the Mactan Export Processing Zone the
16

Mactan Economic Zone.

On October 30, 1995, President Fidel V. Ramos issued Executive Order No. 282, directing the
PEZA to assume and exercise all of the EPZA’s powers, functions, and responsibilities "as
provided in Presidential Decree No. 66, as amended, insofar as they are not inconsistent with the
powers, functions, and responsibilities of the PEZA, as mandated under [the Special Economic
Zone Act of 1995]."  All of EPZA’s properties, equipment, and assets, among others, were
19

ordered transferred to the PEZA.

After the City of Lapu-Lapu had demanded payment of real property taxes from the PEZA, the
Province of Bataan followed suit. In its letter  dated May 29, 2003, the Province, through the
55

Office of the Provincial Treasurer, informed the PEZA that it would be sending a real property tax
billing to the PEZA. Arguing that the PEZA is a developer of economic zones, the Province
claimed that the PEZA is liable for real property taxes under Section 24 of the Special Economic
Zone Act of 1995.

The PEZA’s subsequent requests  for suspension of collection were all denied by the
64

Province.  The Province then served on the PEZA a notice of delinquency in the payment of real
65

property taxes  and a notice of sale of real property for unpaid real property tax.  The Province
66 67

finally sent the PEZA a notice of public auction of the latter’s properties in Mariveles, Bataan.

Issue:

IV. Whether the PEZA is exempt from payment of real property taxes.

23
Ruling:

V.

The PEZA is exempt from payment of

real property taxes

V. (C)

Real properties under the PEZA’s title are owned by the Republic of the Philippines

Under Section 234(a) of the LocalGovernment Code, real properties owned by the Republic of
the Philippines are exempt from real property taxes:

SEC. 234. Exemptions from Real Property Tax. – The following are exempted from payment of
real property tax:

(a) Real property owned by the Republic of the Philippines or any of its political subdivisions
except when the beneficial use thereof has been granted, for consideration or otherwise, to a
taxable person[.]

Properties owned by the state are either property of public dominion or patrimonial property.
Article 420 of the Civil Code of the Philippines enumerates property of public dominion:

Art. 420. The following things are property of public dominion:

(1) Those intended for public use, such as roads, canals, rivers, torrents, ports and
bridges constructed by the State, banks, shores, roadsteads, and others of similar
character;

(2) Those which belong to the State, without belonging for public use, and are intended
for some public service or for the development of the national wealth.

Properties of public dominion are outside the commerce of man. These properties are exempt
from "levy, encumbrance or disposition through public or private sale."  As this court explained
278

in Manila International Airport Authority:

Properties of public dominion, being for public use, are not subject to levy, encumbrance or
disposition through public or private sale. Any encumbrance, levy on execution or auction sale of
any property of public dominion is void for being contrary to public policy. Essential public
services will stop if properties of public dominion are subject to encumbrances, foreclosures and
auction sale[.] 279

On the other hand, all other properties of the state that are not intended for public use or are not
intended for some public service or for the development of the national wealth are patrimonial
properties. Article 421 of the Civil Code of the Philippines provides:

Art. 421. All other property of the State, which is not of the character stated in the preceding
article, is patrimonial property.

Patrimonial properties are also properties of the state, but the state may dispose of its
patrimonial property similar to private persons disposing of their property. Patrimonial properties
are within the commerce of man and are susceptible to prescription, unless otherwise provided. 280

24
In this case, the properties sought to be taxed are located in publicly owned economic zones.
These economic zones are property of public dominion. The City seeks to tax properties located
within the Mactan Economic Zone,  the site of which was reserved by President Marcos under
281

Proclamation No. 1811, Series of 1979. Reserved lands are lands of the public domain set aside
for settlement or public use, and for specific public purposes by virtue of a presidential
proclamation.  Reserved lands are inalienable and outside the commerce of man,  and remain
282 283

property of the Republic until withdrawn from publicuse either by law or presidential
proclamation.  Since no law or presidential proclamation has been issued withdrawing the site of
284

the Mactan Economic Zone from public use, the property remains reserved land.

As for the Bataan Economic Zone, the law consistently characterized the property as a port.
Under Republic Act No. 5490, Congress declared Mariveles, Bataan "a principal port of
entry"  to serve as site of a foreign trade zone where foreign and domestic merchandise may be
285

brought in without being subject to customs and internal revenue laws and regulations of the
Philippines. 286

Section 4 of Republic Act No. 5490 provided that the foreign trade zone in Mariveles, Bataan
"shall at all times remain to be owned by the Government":

The port in Mariveles, Bataan then became the Bataan Economic Zone under the Special
Economic Zone Act of 1995.  Republic Act No. 9728 then converted the Bataan Economic Zone
287

into the Freeport Area of Bataan. 288

A port of entry, where imported goods are unloaded then introduced in the market for public
consumption, is considered property for public use. Thus, Article 420 of the Civil Code classifies
a port as property of public dominion. The Freeport Area of Bataan, where the government
allows tax and duty-free importation of goods,  is considered property of public dominion. The
289

Freeport Area of Bataan is owned by the state and cannot be taxed under Section 234(a) of the
Local Government Code.

Properties of public dominion, even if titled in the name of an instrumentality as in this case,
remain owned by the Republic of the Philippines. If property registered in the name of an
instrumentality is conveyed to another person,the property is considered conveyed on behalf of
the Republic of the Philippines. Book I, Chapter 12, Section 48 of the Administrative Code of
1987 provides:

The Republic may grant the beneficialuse of its real property to an agency or instrumentality of
the national government. This happens when title of the real property is transferred to an agency
or instrumentality even as the Republic remains the owner of the real property. Such
arrangement does not result in the loss of the tax exemption/ Section 234(a) of the Local
Government Code states that real property owned by the Republic loses its tax exemption only if
the "beneficial use thereof has been granted, for consideration or otherwise, to a taxable person."
. . .  (Emphasis in the original; italics supplied)
290

Even the PEZA’s lands and buildings whose beneficial use have been granted to other persons
may not be taxed with real property taxes. The PEZA may only lease its lands and buildings to
PEZA-registered economic zone enterprises and entities.  These PEZA-registered enterprises
291

and entities, which operate within economic zones, are not subject to real property taxes. Under
Section 24 of the Special Economic Zone Act of 1995, no taxes, whether local or national, shall
be imposed on all business establishments operating within the economic zones: SEC. 24.
Exemption from National and Local Taxes. – Except for real property on land owned by

25
developers, no taxes, local and national, shall be imposed on business establishments operating
within the ECOZONE.

For its part, the Province of Bataan collects a fifth of the 5% final tax on gross income paid by all
business establishments operating within the Freeport Area of Bataan:

Petitioners, therefore, are not deprived of revenues from the operations of economic zones within
their respective territorial jurisdictions.

The national government ensured that loeal government units comprising economic zones shall
retain their basic autonomy and identity. 295

All told, the PEZA is an instrumentality of the national government.  Furthermore, the lands
1âwphi1

owned by the PEZA are real properties owned by the Republic of the Philippines. The City of
Lapu-Lapu and the Province of Bataan cannot collect real property taxes from the PEZA.

Republic v. Aboitiz, G.R. No. 174626, October 23, 2013

Facts:

26
On September 11, 1998, respondent Aboitiz filed his Application for Registration of Land Title of
a parcel of land with an area of 1,254 square meters, located in Talamban, Cebu City, and
identified as Lot 11193 of the Cebu Cadastre 12 Extension, before the RTC.

After establishing the jurisdiction of the RTC to act on the application for registration of land title,
hearing thereon ensued.

In support of his application, Aboitiz attached the original Tracing Cloth Plan with a blueprint
copy, the technical description of the land, the certificate of the geodetic engineer surveying the
land, and the documents evidencing possession and ownership of the land.

To prove his claim, Aboitiz presented his witness, Sarah Benemerito (Sarah), his secretary, who
testified that he entrusted to her the subject property and appointed her as its caretaker; that he
purchased the subject property from Irenea Kapuno (Irenea) on September 5, 1994; that he had
been in actual, open, continuous, and exclusive possession of the subject property in the concept
of an owner; that as per record of the Department of Environment and Natural Resources
(DENR), Region VII, the subject property had been classified as alienable and disposable since
1957; that per certification of the Community Environment and Natural Resources Office
(CENRO), Cebu City, the subject property was not covered by any subsisting public land
application; and that the subject property had been covered by tax declarations from 1963 to
1994 in Irenea’s name, and from 1994 to present, in his name.

On February 21, 2002, the RTC granted Aboitiz’s application for registration of the subject
property.

In granting the application for registration of land title, the CA relied on Section 14(2) of P.D. No.
1529.9 It stated that although the application for registration of Aboitiz could not be granted
pursuant to Section 14(1) of P.D. No. 1529 because the possession of his predecessor-in-
interest commenced in 1963 (beyond June 12, 1945), it could prosper by virtue of acquisitive
prescription under Section 14(2) of P.D. No. 1529 upon the lapse of thirty (30) years. The CA
explained that the original owner’s (Irenea’s) possession of the subject property beginning from
1963 up to 1994, the year Aboitiz purchased the subject property from Irenea, spanning thirty
one (31) years, converted the said property into private land and, thus, susceptible to
registration. The CA also declared that although tax declarations and real property tax payments
were not by themselves conclusive evidence of ownership of land, they were nevertheless good
indicia of possession in the concept of an owner.

Issue:

THE CA ERRED ON A QUESTION OF LAW IN GRANTING THE APPLICATION FOR

REGISTRATION OF LOT 11193 UNDER PLAN RS-07-000856 BASED ON THE EVIDENCE IT
RELIED UPON EARLIER DISMISSING THE SAID APPLICATION.

Ruling:

The petition is meritorious. The vital issue to be resolved by the Court is whether Aboitiz is
entitled to the registration of land title under Section 14(1) of P.D. No. 1529, or, in the alternative,
pursuant to Section 14(2) of P.D. No. 1529.

27
Based on the above-quoted provisions, applicants for registration of land title must establish and
prove: (1) that the subject land forms part of the disposable and alienable lands of the public
domain; (2) that the applicant and his predecessors-in-interest have been in open, continuous,
exclusive and notorious possession and occupation of the same; and (3) that it is under a bona
fide claim of ownership since June 12, 1945, or earlier.

The foregoing requisites are indispensable for an application for registration of land title, under
Section 14(1) of P.D. No. 1529, to validly prosper. The absence of any one requisite renders the
application for registration substantially defective.

Anent the first requisite, to authoritatively establish the subject land’s alienable and disposable
character, it is incumbent upon the applicant to present a CENRO or Provincial Environment and
Natural Resources Office (PENRO) Certification; and a copy of the original classification
approved by the DENR Secretary and certified as a true copy by the legal custodian of the official
records.17

Strangely, the Court cannot find any evidence to show the subject land’s alienable and
disposable character, except for a CENRO certification submitted by Aboitiz. Clearly, his attempt
to comply with the first requisite of Section 14(1) of P.D. No. 1529 fell short due to his own
omission. In Republic v. Hanover Worldwide Trading Corporation, 18 the Court declared that the
CENRO is not the official repository or legal custodian of the issuances of the DENR Secretary
declaring the alienability and disposability of public lands. Thus, the CENRO Certification should
be accompanied by an official publication of the DENR Secretary’s issuance declaring the land
alienable and disposable. For this reason, the application for registration of Aboitiz should be
denied.

With regard to the third requisite, it must be shown that the possession and occupation of a
parcel of land by the applicant, by himself or through his predecessors-in-interest, started on
June 12, 1945 or earlier.19 A mere showing of possession and occupation for 30 years or more,
by itself, is not sufficient.20

Unfortunately, Aboitiz likewise failed to satisfy this third requisite. As the records and pleadings of
this case will reveal, the earliest that he and his predecessor-in-interest can trace back
possession and occupation of the subject land was only in the year 1963. Evidently, his
possession of the subject property commenced roughly eighteen (18) years beyond June 12,
1945, the reckoning date expressly provided under Section 14(1) of P.D. No. 1529. Here, he
neglected to present any convincing and persuasive evidence to manifest compliance with the
requisite period of possession and occupation since June 12, 1945 or earlier. Accordingly, his
application for registration of land title was legally infirm.

Section 14(2) of P.D. No. 1529

Notwithstanding his failure to comply with the requirements for registration of land title under
Section 14(1) of P.D. No. 1529, Aboitiz advances that he has, nonetheless, satisfied the
requirements of possession for thirty (30) years to acquire title to the subject property via
prescription under Section 14(2) of P. D. No. 1529.

Regrettably, the Court finds Itself unable to subscribe to applicant’s proposition.

Significantly, Section 14(2) of P.D. No. 1529 provides:

SEC. 14. Who may apply. – The following persons may file in the proper Court of First Instance
an application for registration of title to land, whether personally or through their duly authorized
representatives:

28
 xxxx

(2) Those who have acquired ownership of private lands by prescription under the provisions of
existing laws.

However, public domain lands become only patrimonial property not only with a declaration that
these are alienable or disposable. There must also be an express government manifestation that
the property is already patrimonial or no longer retained for public service or the development of
national wealth, under Article 422 of the Civil Code. And only when the property has become
patrimonial can the prescriptive period for the acquisition of property of the public dominion begin
to run.

(a) Patrimonial property is private property of the government.  The person acquires
1âwphi1

ownership of patrimonial property by prescription under the Civil Code is entitled to

secure registration thereof under Section 14(2) of the Property Registration Decree.

(b) There are two kinds of prescription by which patrimonial property may be acquired,
one ordinary and other extraordinary. Under ordinary acquisitive prescription, a person
acquires ownership of a patrimonial property through possession for at least ten (10)
years, in good faith and with just title. Under extraordinary acquisitive prescription, a
person’s uninterrupted adverse possession of patrimonial property for at least thirty (30)
years, regardless of good faith or just title, ripens into ownership. 23 [Emphasis supplied]

Thus, under Section 14(2) of P.D. No. 1529, for acquisitive prescription to commence and
operate against the State, the classification of ' land as alienable and disposable alone is not
sufficient. The applicant must be able to show that the State, in addition to the said classification,
expressly declared through either a law enacted by Congress or a proclamation issued, by the
President that the subject land is no longer retained for public service or the development of the
national wealth or that the property has been converted into patrimonial. Consequently, without
an express declaration by the State, the land remains to be a property of public dominion and,
hence, not susceptible to acquisition by virtue of prescription.

In fine, the Court holds that the ruling of the CA lacks sufficient factual or legal justification.
Hence, the Court is constrained to reverse the assailed CA Amended Decision and Resolution
and to deny the application for registration of land title of Aboitiz.

Alolino v. Flores, G.R. No. 198774, 4 April 2016

29
Facts:

Alolino is the registered owner of two (2) contiguous parcels of land situated at No.
47 Gen. Luna Street, Barangay Tuktukan, Taguig, covered by Transfer Certificate of
Title (TCT) Nos. 784 and 976. TCT No. 784 was issued on August 30, 1976 covering
an area of 26 square meters; while TCT No. 976 was issued on August 29, 1977,
with an area of 95 square meters.

Alolino initially constructed a bungalow-type house on the property. In 1980, he

added a second floor to the structure. He also extended his two-storey house up to
the edge of his property. There are terraces on both floors. There are also six (6)
windows on the perimeter wall: three (3) on the ground floor and another three (3)
on the second floor.

In 1994, the respondent spouses Fortunato and Anastacia (Marie) Flores constructed
their house/sari sari store on the vacant municipal/barrio road immediately adjoining
the rear perimeter wall of Alolino's house. Since they were constructing on a
municipal road, the respondents could not secure a building permit. The structure is
only about two (2) to three (3) inches away from the back of Alolino's house,
covering five windows and the exit door. The respondents' construction deprived
Alolino of the light and ventilation he had previously enjoyed and prevented his
ingress and egress to the municipal road through the rear door of his house.

Alolino demanded that the respondent spouses remove their structure but the latter
refused. Thus, he complained about the illegal construction to the Building Official of
the Municipality of Taguig. He also filed a complaint with the Barangay of Tuktukan.

Acting on Alolino's complaint, the Building Official issued a Notice of Illegal

Construction against the respondents on February 15, 1995, directing them to
immediately stop further construction.4

Sometime in 2001 or 2002, the respondents began constructing a second floor to

their structure, again without securing a building permit. This floor was to serve as
residence for their daughter, Maria Teresa Sison. The construction prompted Alolino
to file another complaint with the Building Official of Taguig.

The respondents did not comply with the directive from the building official. This
prompted Alolino to send them a letter dated January 23, 2003, demanding the
removal of their illegally constructed structure.

Despite receipt of the demand letter, the respondents refused to comply. Thus, on
February 14, 2003, Alolino filed a complaint against the respondents with the RTC
praying for: (1) the removal of the encroaching structure; (2) the enforcement of his
right to easement of light and view; and (3) the payment of damages. Alolino
claimed that the respondents' encroaching structure deprived him of his light and
view and obstructed the air ventilation inside his house. The complaint was docketed
as Civil Case No. 69320.

In their answer,7 the respondent spouses denied that Alolino had a cause of action
against them. They alleged that they had occupied their lot where they constructed
their house in 1955, long before the plaintiff purchased his lot in the 70s. They
further alleged that plaintiff only has himself to blame because he constructed his

30
house up to the very boundary of his lot without observing the required setback.
Finally, they emphasized that the wall of their house facing Alolino's does not violate
the latter's alleged easement of light and view because it has no window.

The respondents also admitted to them that they did not secure a building permit
because the property was constructed on a municipal/barrio road. They claimed,
however, that on March 1, 2004, the Sangguniang Bayan of Taguig (the
Sanggunian) reclassified the property as a residential lot from its prior classification
as a barrio/municipal road.

Issue:

Alolino insists (1) that he acquired an easement of light and view by virtue of a title
because the respondents constructed their house on a barrio road; (2) that the
provision of Sec. 708 of the National Building Code and Article 670 of the Civil Code
prescribing the setbacks is inapplicable because the property is adjacent to
a barrio road; (3) that he has a right of way over the lot occupied by the
respondents because it is a barrio road; and (4) that the respondents' house/sari
sari store is a nuisance per se.

Ruling:

We find the petition meritorious.

There is no dispute that respondents built their house/sari sari store on government

property. Properties of Local Government Units (LGUs) are classified as either
property for public use or patrimonial property. 13 Article 424 of the Civil Code
distinguishes between the two classifications:
chanRoblesvirtualLawlibrary

Article 424. Property for public use, in the provinces, cities, and municipalities,
consist of the provincial roads, city streets, municipal streets, the squares,
fountains, public waters, promenades, and public works for public service paid for by
said provinces, cities, or municipalities.

All other property possessed by any of them is patrimonial and shall be governed by
this Code, without prejudice to the provisions of special laws. 14 (emphasis supplied)
From the foregoing, the barrio road adjacent to Alolino's house is property of public
dominion devoted to public use.

We find no merit in the respondents' contention that the Local Government of Taguig
had already withdrawn the subject barrio road from public use and reclassified it as
a residential lot. The Local Government Code 15 (LGC) authorizes an LGU to withdraw
a local road from public use under the folio wing conditions:
chanRoblesvirtualLawlibrary

Section 21. Closure and Opening of Roads. -

(a) A local government unit may, pursuant to an ordinance, permanently or

temporarily close or open any local road, alley, park, or square falling within its

31
 jurisdiction; Provided, however, That in case of permanent
closure, such ordinance must be approved by at least two-thirds (2/3) of all the
members of the Sanggunian, and when necessary, an adequate substitute for the. public
facility that is subject to closure is provided.
(b) No such way or place or any part thereof shall be permanently closed without making
provisions for the maintenance of public safety therein. A property thus permanently
withdrawn from public use may be used or conveyed for any purpose for which
other real property belonging to the local government unit concerned may be
lawfully used or conveyed. x x x

To convert a barrio road into patrimonial property, the law requires the LGU to enact
an ordinance, approved by at least two-thirds (2/3) of the Sanggunian members,
permanently closing the road.

In this case, the Sanggunian did not enact an ordinance but merely passed a
resolution. The difference between an ordinance and a resolution is settled in
jurisprudence: an ordinance is a law but a resolution is only a declaration of
sentiment or opinion of the legislative body. 16

Properties of the local government that are devoted to public service are deemed
public and are under the absolute control of Congress.17 Hence, LGUs cannot control
or regulate the use of these properties unless specifically authorized by Congress, as
is the case with Section 21 of the LGC. 18 In exercising this authority, the LGU must
comply with the conditions and observe the limitations prescribed by Congress. The
Sanggunian's failure to comply with Section 21 renders ineffective its reclassification
of the barrio road.

As a barrio road, the subject lot's purpose is to serve the benefit of the collective
citizenry. It is outside the commerce of man and as a consequence: (1) it is not
alienable or disposable;19 (2) it is not subject to registration under Presidential
Decree No. 1529 and cannot be the subject of a Torrens title; 20 (3) it is not
susceptible to prescription;21 (4) it cannot be leased, sold, or otherwise be the
object of a contract;22 (5) it is not subject to attachment and execution; 23 and (6)
it cannot be burdened by any voluntary easements.24

An 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 community,
or of one or more persons to whom the encumbered estate does not
belong.25Continuous and apparent easements may be acquired by virtue of a
title or by prescription of ten years.26 Meanwhile, continuous but non-apparent
easements and discontinuous ones can only be acquired by virtue of a
title.27 Used in this sense, title refers to a juridical justification for the acquisition of
a right. It may refer to a law, a will, a donation, or a contract.

We must distinguish between the respondents' house and the land it is built on. The
land itself is public property devoted to public use. It is not susceptible to
prescription and cannot be burdened with voluntary easements. On the other hand,
the respondents' house is private property, albeit illegally constructed on public
property. It can be the object of prescription and can be burdened with voluntary
easements. Nevertheless, it is indisputable that the respondents have not voluntarily
burdened their property with an easement in favor of Alolino.

32
An easement of a right of way is discontinuous and cannot be acquired through
prescription.28 On the other hand, an easement of light and view can be acquired
through prescription counting from the time when the owner of the dominant estate
formally prohibits the adjoining lot owner from blocking the view of a window
located within the dominant estate.29

Notably, Alolino had not made (and could not have made) a formal prohibition upon
the respondents prior to their construction in 1994; Alolino could not have acquired
an easement of light and view through prescription. Thus, only easements created
by law can burden the respondents' property.

The provisions on legal easements are found in Book II, Title VII, Chapter 2 of the
Civil Code whose specific coverage we list and recite below for clarity and
convenience.

Section 3 (Articles 649-657) governs legal easements of right of way. Article

649 creates a legal easement in favor of an owner or any person entitled to use any
immovable, which is landlocked by other immovables pertaining to other persons
without an adequate access to a public highway. Article 652 creates a legal
easement in favor of an isolated piece of land acquired by sale, exchange, partition,
or donation when it is surrounded by other estates of the vendor, exchanger, co-
owner, or donor. Article 653 grants the same right of way. in favor of the vendor,
exchanger, co-owner, or donor when his property is the one that becomes
isolated. Article 656 grants the owner of an estate, after payment of indemnity, a
right of way to carry materials through the estate of another when it.is indispensable
for the construction or repair of a building in his estate. Finally, Article 657 governs
right of way easements for the passage of livestock.

None of these provisions are applicable to Alolino's property with respect to

the barrio road where the respondents' house stands on.

However, none of these provisions actually create a legal easement of light and view
which can only be acquired through prescription or a by virtue of a voluntary title.

From the foregoing, we agree with the respondents that Alolino does not have an
easement of light and view or an easement of right of way over the respondents'
property or the barrio road it stands on. This does not mean, however, that the
respondents are entitled to continue occupying the barrio road and blocking the rear
of Alolino's house. Every building is subject to the easement which prohibits the
proprietor or possessor from committing nuisance.30 Under Article 694 of the Civil
Code, the respondents' house is evidently a nuisance:

A barrio road is designated for the use of the general public who are entitled to free
and unobstructed passage thereon. Permanent obstructions on these roads, such as
the respondents' illegally constructed house, are injurious to public welfare and
convenience. The occupation and use of private individuals of public places devoted
to public use constitute public and private nuisances and nuisance per se.

The invoked provision itself allows the demolition of illegal structures on public roads
and sidewalks because these nuisances are injurious to public welfare. Evidently, the

33
respondents have no right to maintain their occupation and permanent obstruction
of the barrio road. The interests of the few do not outweigh the greater interest of
public health, public safety, good order, and general welfare.

34