Property Lecture 3 – 2019

Start of Chapter 3

OWNERSHIP, ACCESSION AND CO-OWNERSHIP (INCLUDING THE CONDOMINIUM

ACT {Rep. Act No. 4726}); ACCESSION
Part III
Civil Law Review
Lecture Series

Registered Lands

Query 1. The guarantee of the torrens law is that a property which is covered by
a torrens title could not be subject of prescription. Is there a chance that a
registered owner of property who has failed to recover possession of his
registered property, be permanently barred by prescription or laches?

Doctrinal-ruling: “As registered owners of the lots in question, the private

respondents have a right to eject any person illegally occupying their
property. This right is imprescriptible. Even if it be supposed that they were
aware of the petitioner’s occupation of the property, and regardless of the length
of that possession, the lawful owners have a right to demand the return of their
property at any time as long as the possession was unauthorized or
merely tolerated, if at all. This right is never barred by laches”. (Citations omitted)
[1] [G.R. No. 140357. September 24, 2004] SPOUSES REYNALDO and EDITHA
LOPEZ, petitioners, vs. MARGARITA SARABIA, respondent

Acquisitive prescription does not apply to registered land.

The assertion of petitioners that they acquired ownership of the property by virtue
of their open, continuous, adverse and exclusive possession thereof for more
than 60 years is likewise untenable. As early as 1902, when Act No. 496
created the Torrens system of registration, the law already declared that
registered land cannot be acquired by prescription or adverse possession.
105 This principle is currently found in Section 47 of P.D. 1529: Section 47.
Registered land not subject to prescriptions. No title to registered land in
derogation to that of the registered owner shall be acquired by prescription
or adverse possession. It is undisputed that the subject property is
registered land. Hence, even assuming that petitioners occupied it for a
considerable period after the sale, their possession could not have ever ripened
into ownership. Respondents are entitled to possession of the property. In view
of our ruling in favor of respondents on the issue of ownership, we likewise
conclude that they are entitled to possession of the land in question. They have
the right to enjoy and dispose of it without limitations other than those imposed
by law. Our ruling on ownership also renders immaterial the issue of tolerance
raised by petitioners. Since their supposed title over the land – based on the
donation propter nuptias and on their claim of acquisitive prescription –
has been defeated by the registered Deed of Absolute Sale, petitioners
clearly have no right to remain on the property. Regardless of whether or not
their prior possession of the property had been tolerated by respondents, it is
evident that petitioners must now vacate the land. Accordingly, we rule that the
CA committed no reversible error in declaring respondents as the rightful owners
of the land in the action for the quieting of title; and in ordering petitioners to
vacate the property in the ejectment case. As a final point, the Court is aware
that our ruling will affect the structures currently standing on the property, which
petitioners claim to own. Our decision may then engender certain issues of
accession, particularly the right to reimbursement of expenses and payment of
damages. Unfortunately, these matters were not raised by any of the parties
before this Court or any of the lower courts. The dearth of evidence on this point
likewise prevents us from making any pronouncement on the matter. These
questions must perforce be dealt with in another proceeding. – Tomas R.
Leonidas v. Republic of the Philippines, G.R. No. 201031, December 14,
2017 

Contra-Ruling: “Likewise, it must be stressed that unlike prescription, laches is

not concerned merely with the fact of delay, but even more with the effect of
unreasonable delay. In Vda. de Cabrera v. CA, we explained:

In our jurisdiction, it is an enshrined rule that even a registered owner of property

may be barred from recovering possession of property by virtue of laches. Under
the Land Registration Act (now the Property Registration Decree), no title to
registered land in derogation to that of the registered owner shall be acquired by
prescription or adverse possession. The same is not true with regard to laches.
As we have stated earlier in Mejia de Lucas vs. Gamponia, while the defendant
may not be considered as having acquired title by virtue of his and his
predecessors long continued possession (37 years) the original owners right to
recover x x x the possession of the property and the title thereto from the
defendant has, by the latters long period of possession and by patentees inaction
and neglect, been converted into a stale demand.

The contention of petitioner that her right to recover is imprescriptible because

the property was registered under the Torrens system also fails to convince us. It
was the finding of the trial court that the property was not yet covered by a free
patent on January 4, 1966, when Captain Villalba acquired possession
thereof. Indeed, the evidence shows that as of that date, the documents relating
to the property were still in the name of Pilar Castrence, from whom petitioner
purchased the property on April 27, 1966; that she applied for a free patent
therefor between January 4 and April 27, 1966; and that the original certificate of
title over the lot was issued to her under Free Patent No. (x-1) 3732 only
on August 16, 1974.

It is apparent, then, that petitioner sold the house and lot to respondent
on January 4, 1966, before she had even acquired the title to convey
it. Moreover, she applied for a free patent after she lost, by operation of law, the
title she had belatedly acquired from Castrence. These circumstances raise
serious questions over the formers good faith in delaying the assertion of her
rights to the property. They bar her from seeking relief under the principle that
one who comes to court must come with clean hands.” [2]

CHAPTER 2
Right of Accession

GENERAL PROVISIONS

Article 440. The ownership of property gives the right by accession to

everything which is produced thereby, or which is incorporated or attached
thereto, either naturally or artificially. (353)

SECTION 1
Right of Accession with Respect to What is Produced by Property

Article 441. To the owner belongs:

(1) The natural fruits;

(2) The industrial fruits;

(3) The civil fruits. (354)

Article 442. Natural fruits are the spontaneous products of the soil, and the
young and other products of animals.

Industrial fruits are those produced by lands of any kind through

cultivation or labor.
Civil fruits are the rents of buildings, the price of leases of lands and other
property and the amount of perpetual or life annuities or other similar
income. (355a)

Article 443. He who receives the fruits has the obligation to pay the
expenses made by a third person in their production, gathering, and
preservation. (356)

–        

Compare with Art 449 which applies only if the crops have not yet been gathered.

Article 444. Only such as are manifest or born are considered as natural or

industrial fruits.

With respect to animals, it is sufficient that they are in the womb of the mother,
although unborn. (357)

SECTION 2
Right of Accession with Respect to Immovable Property

Article 445. Whatever is built, planted or sown on the land of another and

the improvements or repairs made thereon, belong to the owner of the
land, subject to the provisions of the following articles. (358)

Comment:

Basic Principles of Accession Continua (Accession Industrial)

a)    To the owner of the principal must belong also the accessions, in

accordance with the principle of “the accessory follows the principal”

b)   The union or incorporation must, with certain exceptions, be effected in

such a manner that to separate the principal from the accessory would
result in substantial injury to either

c)    He who is in good faith may be held responsible but he should not be
penalized

d)   He who is in bad faith may be penalized

e)    No one should enrich himself unjustly at the expense of another

f)     Bad faith of one party neutralizes the bad faith of the other so both
should be considered in good faith.(Paras, New Civil Code, Ibid.)
Article 446. All works, sowing, and planting are presumed made by the
owner and at his expense, unless the contrary is proved. (359)

Article 447. The owner of the land who makes thereon, personally or

through another, plantings, constructions or works with the materials of
another, shall pay their value; and, if he acted in bad faith, he shall also be
obliged to the reparation of damages. The owner of the materials shall have
the right to remove them only in case he can do so without injury to the
work constructed, or without the plantings, constructions or works being
destroyed. However, if the landowner acted in bad faith, the owner of the
materials may remove them in any event, with a right to be indemnified for
damages. (360a)

Article 448. The owner of the land on which anything has been built, sown
or planted in good faith, shall have the right to appropriate as his own the
works, sowing or planting, after payment of the indemnity provided for in
articles 546 and 548, or to oblige the one who built or planted to pay the
price of the land, and the one who sowed, the proper rent. However, the
builder or planter cannot be obliged to buy the land if its value is
considerably more than that of the building or trees. In such case, he shall
pay reasonable rent, if the owner of the land does not choose to
appropriate the building or trees after proper indemnity. The parties shall
agree upon the terms of the lease and in case of disagreement, the court
shall fix the terms thereof. (361a)

Comments:

1)     Conflicts of rights rule. Applies only when there is a conflict

2)    “considerably more”; application.

3)    Builder and Planter v. Sower

4)   Right of Retention

5)    Choice Irrevocable

6)   No right of removal or demolition UNLESS after selected a compulsory sale,

the builder fails to pay for the land

7)    Status quo while Landowner cannot yet make a choice

8)   Builder in Bad faith not entitled to any form of reimbursement at all?

9)   See Crispin Aquino v. Sps. Eusebio Aguilar[4] : “Pursuant to Art. 452 NCC,
BBF is entitled to recoup necessary expenses for preservation of the land”.

10) Jurisprudence instructs that the builder, planter or sower who is referred to in

Article 448 refers to one who in good faith believes that he is the owner of the
land where he introduces the improvements. In other words, the builder, planter
or sower must have some claim of ownership or semblance of any of the mode
of acquiring title or ownership which necessarily means that those without a claim
of ownership like a lessee or mortgagee, knowing full well that they are not the
owners of the land, do not fall within the category of possessors as contemplated
by Article 448.

Thus:

“Conceding that the transaction was not really a sale of the subject property, the
Spouses Lopez now demand their rights for reimbursement for expenses and
improvements made on the land under Articles 448 and 1616 of the Civil
Code. This leads us to the pivotal question: Can the Spouses Lopez invoke
Article 448 and claim the benefits of this provision as builders in good faith
when they constructed improvements on the subject property?

The trial court found the Spouses Lopez in bad faith and ordered the forfeiture of
the improvements in Margarita’s favor. The CA disagreed with the trial court as it
ruled:

Construction of the improvements went on without the objections of Margarita. It

can thus be safely concluded that, absent any objections, the Lopez spouses
sincerely believed that as lessees, they had Margaritas approval to construct
such improvements. Forfeiture of the improvements in Margaritas favor is thus
not warranted.

The petitioners allege that Article 448 applies in this case because they
constructed the building on one of the lots in the concept of owner, after the title
over the two lots had already been transferred in their names and out of the
proceeds of their Pag-ibig loan. They believed that they have a right to build
because they thought that they owned the land or believed themselves to have
claim or title.

The contention is untenable.

Articles 448 and 546 of the New Civil Code, which allow full reimbursement
of useful improvements and retention of the premises until reimbursement
is made, apply only to a possessor in good faith, i.e., one who builds on
land with the belief that he is the owner thereof. A builder in good faith is
one who is unaware of any flaw in his title to the land at the time he builds
on it.[39] In this case, the petitioners cannot claim that they were not aware of any
flaw in their title or were under the belief that they were owners of the subject
properties. It was the agreement and intention that Margaritas titles would only
be lent to them in order to secure the Pag-ibig Housing Loan, in which Margarita
had a direct interest since the proceeds thereof were to be immediately applied
to her mortgage obligation with the PNB. There was no agreement or intention to
transfer ownership of the subject properties. The petitioners cannot claim to
be owners. Hence, they cannot be considered builders in good
faith. Article 448 is not applicable.[1]

Similarly, in the much later case of Communities Cagayan, Inc. v. Spouses

Arsenio et al[2] (G.R. No. 176791, November 14, 2012),  it was ruled that  “As
a general rule, Article 448 on builders in good faith does not apply where
there is a contractual relation between the parties, such as in the instant
case.” The SC extrapolated in this manner:

“Respondent-spouses are entitled to reimbursement of the improvements made

on the property. 

Petitioner posits that Article 448 of the Civil Code does not apply and that
respondent-spouses are not entitled to reimbursement of the value of the
improvements made on the property because they were builders in bad faith. At
the outset, we emphasize that the issue of whether respondent-spouses are
builders in good faith or bad faith is a factual question, which is beyond the scope
of a petition filed under Rule 45 of the Rules of Court. In fact, petitioner is
deemed to have waived all factual issues since it appealed the case directly to
this Court instead of elevating the matter to the CA. It has likewise not escaped
our attention that after their failed preliminary conference, the parties agreed to
submit the case for resolution based on the pleadings and exhibits presented. No
trial was conducted. Thus, it is too late for petitioner to raise at this stage of the
proceedings the factual issue of whether respondent-spouses are builders in bad
faith. Hence, in view of the special circumstances obtaining in this case, we are
constrained to rely on the presumption of good faith on the part of the
respondent-spouses which the petitioner failed to rebut. Thus, respondent-
spouses being presumed builders in good faith, we now rule on the applicability
of Article 448 of the Civil Code.

As a general rule, Article 448 on builders in good faith does not apply
where there is a contractual relation between the parties, such as in the
instant case. We went over the records of this case and we note that the parties
failed to attach a copy of the Contract to Sell. As such, we are constrained to
apply Article 448 of the Civil Code, which provides viz:
ART. 448. The owner of the land on which anything has been built, sown or
planted in good faith, shall have the right to appropriate as his own the works,
sowing or planting, after payment of the indemnity provided for in Articles 546
and 548, or to oblige the one who built or planted to pay the price of the land, and
the one who sowed, the proper rent. However, the builder or planter cannot be
obliged to buy the land if its value is considerably more than that of the building
or trees. In such case, he shall pay reasonable rent, if the owner of the land does
not choose to appropriate the building or trees after proper indemnity.

The parties shall agree upon the terms of the lease and in case of disagreement,
the court shall fix the terms thereof.

Article 448 of the Civil Code applies when the builder believes that he is the
owner of the land or that by some title he has the right to build thereon,60
or that, at least, he has a claim of title thereto.61 Concededly, this is not
present in the instant case. The subject property is covered by a Contract to Sell
hence ownership still remains with petitioner being the seller. Nevertheless, there
were already instances where this Court applied Article 448 even if the builders
do not have a claim of title over the property. Thus:

 General Rule on Builder in Good Faith:

This Court has ruled that this provision covers only cases in which the
builders, sowers or planters believe themselves to be owners of the land
or, at least, to have a claim of title thereto. It does not apply when the interest
is merely that of a holder, such as a mere tenant, agent or usufructuary. From
these pronouncements, good faith is identified by the belief that the land is
owned; or that – by some title – one has the right to build, plant, or sow thereon.

 Exceptions:

 However, in some special cases, this Court has used Article 448 by
recognizing good faith beyond this limited definition. Thus, in Del Campo v.
Abesia, this provision was applied to one whose house – despite having been
built at the time he was still co-owner – overlapped with the land of another.

  1)This article was also applied to cases wherein a builder had constructed
improvements with the consent of the owner. The Court ruled that the law
deemed the builder to be in good faith. In Sarmiento v. Agana, the builders
were found to be in good faith despite their reliance on the consent of another,
whom they had mistakenly believed to be the owner of the land.

2)The Court likewise applied Article 448 in Spouses Macasaet v. Spouses

Macasaet notwithstanding the fact that the builders therein knew they were
not the owners of the land. In said case, the parents who owned the land
allowed their son and his wife to build their residence and business
thereon. As found by this Court, their occupation was not by mere
tolerance but “upon the invitation of and with the complete approval of
(their parents), who desired that their children would occupy the premises.
It arose from familial love and a desire for family solidarity x x x.” Soon
after, conflict between the parties arose. The parents demanded their son
and his wife to vacate the premises. The Court thus ruled that as owners of
the property, the parents have the right to possession over it.

However, they must reimburse their son and his wife for the improvements they
had introduced on the property because they were considered builders in good
faith even if they knew for a fact that they did not own the property, thus:62
Spouses Macasaet v. Spouses Macasaet, 482 Phil. 853, 871-872 (2004). 63 Id.
64 Id. at 865.

Based on the aforecited special cases, Article 448 applies to the present factual
milieu. The established facts of this case show that respondents fully consented
to the improvements introduced by petitioners. In fact, because the children
occupied the lots upon their invitation, the parents certainly knew and approved
of the construction of the improvements introduced thereon. Thus, petitioners
may be deemed to have been in good faith when they built the structures on
those lots.

The instant case is factually similar to Javier v. Javier. In that case, this Court
deemed the son to be in good faith for building the improvement (the house) with
the knowledge and consent of his father, to whom belonged the land upon which
it was built. Thus, Article 448 was applied.

In fine, the Court applied Article 448 by construing good faith beyond its limited
definition. We find no reason not to apply the Court’s ruling in Spouses Macasaet
v. Spouses Macasaet in this case. We thus hold that Article 448 is also
applicable to the instant case. First, good faith is presumed on the part of the
respondent-spouses. Second, petitioner failed to rebut this presumption. Third,
no evidence was presented to show that petitioner opposed or objected to the
improvements introduced by the respondent-spouses. Consequently, we can
validly presume that petitioner consented to the improvements being constructed.
This presumption is bolstered by the fact that as the subdivision developer,
petitioner must have given the respondent-spouses permits to commence and
undertake the construction. Under Article 453 of the Civil Code, “[i]t is understood
that there is bad faith on the part of the landowner whenever the act was done
with his knowledge and without opposition on his part.”
In view of the foregoing, we find no error on the part of the RTC in requiring
petitioner to pay respondent-spouses the value of the new house minus the cost
of the old house based on Article 448 of the Civil Code, subject to succeeding
discussions.

Petitioner has two options under Article 448 and pursuant to the ruling in Tuatis
v. Escol.66 In Tuatis, we ruled that the seller (the owner of the land) has two
options under Article 448: (1) he may appropriate the improvements for himself
after reimbursing the buyer (the builder in good faith) the necessary and useful
expenses under Articles 54667 and 54868 of the Civil Code; or (2) he may sell
the land to the buyer, unless its value is considerably more than that of the
improvements, in which case, the buyer shall pay reasonable rent. Quoted below
are the pertinent portions of our ruling in that case:

Taking into consideration the provisions of the Deed of Sale by Installment and
Article 448 of the Civil Code, Visminda has the following options:

Under the first option, Visminda may appropriate for herself the building on the
subject property after indemnifying Tuatis for the necessary and useful expenses
the latter incurred for said building, as provided in Article 546 of the Civil Code.

It is worthy to mention that in Pecson v. Court of Appeals, the Court pronounced

that the amount to be refunded to the builder under Article 546 of the Civil Code
should be the current market value of the improvement,

thus:

xxxx

Until Visminda appropriately indemnifies Tuatis for the building constructed by

the latter, Tuatis may retain possession of the building and the subject property.

Under the second option, Visminda may choose not to appropriate the building
and, instead, oblige Tuatis to pay the present or current fair value of the land.
The P10,000.00 price of the subject property, as stated in the Deed  66 G.R. No.
175399, October 27, 2009, 604 SCRA 471. 67 ART. 546. Necessary
expenses shall be refunded to every possessor; but only the possessor in good
faith may retain the thing until he has been reimbursed therefor.

Useful expenses shall be refunded only to the possessor in good faith with the
same right of retention, the person who has defeated him in the possession
having the option of refunding the amount of the expenses or of paying the
increase in value which the thing may have acquired by reason thereof. 68 ART.
548. Expenses for pure luxury or mere pleasure shall not be refunded to the
possessor in good faith; but he may remove the ornaments with which he has
embellished the principal thing if it suffers no injury thereby, and if his successor
in the possession does not prefer to refund the amount expended.

X x x  of Sale on Installment executed in November 1989, shall no longer apply,

since Visminda will be obliging Tuatis to pay for the price of the land in the
exercise of Visminda’s rights under Article 448 of the Civil Code, and not under
the said Deed. Tuatis’ obligation will then be statutory, and not contractual,
arising only when Visminda has chosen her option under Article 448 of the Civil
Code.

Still under the second option, if the present or current value of the land, the
subject property herein, turns out to be considerably more than that of the
building built thereon, Tuatis cannot be obliged to pay for the subject property,
but she must pay Visminda reasonable rent for the same. Visminda and Tuatis
must agree on the terms of the lease; otherwise, the court will fix the terms.

Necessarily, the RTC should conduct additional proceedings before ordering the
execution of the judgment in Civil Case No. S-618. Initially, the RTC should
determine which of the aforementioned options Visminda will choose.
Subsequently, the RTC should ascertain: (a) under the first option, the amount of
indemnification Visminda must pay Tuatis; or (b) under the second option, the
value of the subject property vis-à-vis that of the building, and depending
thereon, the price of, or the reasonable rent for, the subject property, which
Tuatis must pay Visminda.

The Court highlights that the options under Article 448 are available to Visminda,
as the owner of the subject property. There is no basis for Tuatis’ demand that,
since the value of the building she constructed is considerably higher than the
subject property, she may choose between buying the subject property from
Visminda and selling the building to Visminda for P502,073.00. 

** Option to choose belongs to LO and not the BPS

Again, the choice of options is for Visminda, not Tuatis, to make. And, depending
on Visminda’s choice, Tuatis’ rights as a builder under Article 448 are limited to
the following: (a) under the first option, a right to retain the building and
subject property until Visminda pays proper indemnity; and (b) under the
second option, a right not to be obliged to pay for the price of the subject
property, if it is considerably higher than the value of the building, in which
case, she can only be obliged to pay reasonable rent for the same.

The rule that the choice under Article 448 of the Civil Code belongs to the owner
of the land is in accord with the principle of accession, i.e., that the accessory
follows the principal and not the other way around. Even as the option lies with
the landowner, the grant to him, nevertheless, is preclusive. The landowner
cannot refuse to exercise either option and compel instead the ownerof the
building to remove it from the land.

The raison d’etre for this provision has been enunciated thus:

Where the builder, planter or sower has acted in good faith, a conflict of rights
arises between the owners, and it becomes necessary to protect the owner of the
improvements without causing injustice to the owner of the land. In view of the
impracticability of creating a state of forced co-ownership, the law has provided a
just solution by giving the owner of the land the option to acquire the
improvements after payment of the proper indemnity, or to oblige the builder or
planter to pay for the land and the sower the proper rent. He cannot refuse to
exercise either option. It is the owner of the land who is authorized to exercise
the option, because his right is older, and because, by the principle of accession,
he is entitled to the ownership of the accessory thing.

** Filing of Writ of Execution  cannot be deemed as an expression of choice

to recover possession

 Visminda’s Motion for Issuance of Writ of Execution cannot be deemed as an

expression of her choice to recover possession of the subject property under the
first option, since the options under Article 448 of the Civil Code and their
respective consequences were also not clearly presented to her by the 19 April
1999 Decision of the RTC. She must then be given the opportunity to make a
choice between the options available to her after being duly informed herein of
her rights and obligations under both. (Emphasis supplied.)

In conformity with the foregoing pronouncement, we hold that petitioner, as

landowner, has two options. It may appropriate the new house by reimbursing
respondent Angeles the current market value thereof minus the cost of the old
house. Under this option, respondent Angeles would have “a right of retention
which negates the obligation to pay rent.” In the alternative, petitioner may sell
the lots to respondent Angeles at a price equivalent to the current fair value
thereof. However, if the value of the lots is considerably more than the value of
the improvement, respondent Angeles cannot be compelled to purchase the lots.

She can only be obliged to pay petitioner reasonable rent.

In view of the foregoing disquisition and in accordance with Depra v.Dumlao and
Technogas Philippines Manufacturing Corporation v. Court of Appeals,  we find it
necessary to remand this case to the court of origin for the purpose of
determining matters necessary for the proper application of Article 448, in
relation to Articles 546 and 548 of the Civil Code.
 

11)2016 Bar exam question:

Pedro bought a parcel of land described as Cadastral Lot No. 123 and the title was issued
to his name. Juan also bought a lot in the same place, which is described as Cadastral Lot
No. 124. Pedro hired a geodetic engineer to determine the actual location of Lot No. 123
but for some reason, the engineer pointed to Lot No. 124 by mistake. Pedro hired a
contractor to construct his house and the latter put up a sign stating the name of the
owner of the project and the construction permit number. It took more than a year before
the house was constructed. When Pedro was already residing in his house, Juan told him
to remove his house because it was built on his (Juan’s) lot.
Juan filed a Complaint for Recovery of Possession and prayed that the house be removed
because Pedro is a builder in bad faith. Pedro filed his Answer with Counterclaim that he
is entitled to the payment of the value of the house plus damages because he is a builder
in good faith and that Juan is guilty of estoppel and laches.

[a] If Pedro is a builder in good faith, what are the rights given to Juan under the law?
Explain. (2.5%)
[b] If Pedro is a builder in bad faith, what are the rights given to Juan under the law?
Explain. (2.5%)
Good Faith involving Registered Lands:

       Torrens Title serves as constructive notice to whole world of the ownership

of the registered owner of said property

       Exception: Co Tao v. Chico (L-499167, April 30, 1968)[5]– No one, not even
a surveyor, can determine the precise location of his land by simply examining
his title.

Article 449. He who builds, plants or sows in bad faith on the land of
another, loses what is built, planted or sown without right to indemnity.
(362)

Article 450. The owner of the land on which anything has been built,
planted or sown in bad faith may demand the demolition of the work, or
that the planting or sowing be removed, in order to replace things in their
former condition at the expense of the person who built, planted or sowed;
or he may compel the builder or planter to pay the price of the land, and the
sower the proper rent. (363a)
Article 451. In the cases of the two preceding articles, the landowner is
entitled to damages from the builder, planter or sower. (n)

 Article 452. The builder, planter or sower in bad faith is entitled to

reimbursement for the necessary expenses of preservation of the land. (n)

Article 453. If there was bad faith, not only on the part of the person who
built, planted or sowed on the land of another, but also on the part of the
owner of such land, the rights of one and the other shall be the same as
though both had acted in good faith.

It is understood that there is bad faith on the part of the landowner

whenever the act was done with his knowledge and without opposition on
his part. (364a)

Article 454. When the landowner acted in bad faith and the builder, planter
or sower proceeded in good faith, the provisions of article 447 shall apply.
(n)

Article 455. If the materials, plants or seeds belong to a third person who
has not acted in bad faith, the owner of the land shall answer subsidiarily
for their value and only in the event that the one who made use of them has
no property with which to pay.

 This provision shall not apply if the owner makes use of the right granted
by article 450. If the owner of the materials, plants or seeds has been paid
by the builder, planter or sower, the latter may demand from the landowner
the value of the materials and labor. (365a)

Article 456. In the cases regulated in the preceding articles, good faith does
not necessarily exclude negligence, which gives right to damages under
article 2176. (n)

Article 457. To the owners of lands adjoining the banks of rivers belong the
accretion which they gradually receive from the effects of the current of the
waters. (336)

Comment:

2016 Bar Exam Question

Benjamin is the owner of a titled lot which is bounded on the north by the Maragondon
River. An alluvial deposit of two (2) hectares was added to the registered area. Daniel took
 possession of the portion formed by accretion and claims that he has been in open,
continuous and undisturbed possession of said portion since 1923 as shown by a tax
declaration. In 1958, Benjamin filed a Complaint for Quieting of Title and contends that the
alluvium belongs to him as the riparian owner and that since the alluvium is, by law, part
and parcel of the registered property, the same may be considered as registered property.
Decide the case and explain. (5%)

       Loss by Alluvium Not Affected by Registration Under Land Registration Act

Article 458. The owners of estates adjoining ponds or lagoons do not

acquire the land left dry by the natural decrease of the waters, or lose that
inundated by them in extraordinary floods. (367)

Article 459. Whenever the current of a river, creek or torrent segregates

from an estate on its bank a known portion of land and transfers it to
another estate, the owner of the land to which the segregated portion
belonged retains the ownership of it, provided that he removes the same
within two years. (368a)

Article 460. Trees uprooted and carried away by the current of the waters
belong to the owner of the land upon which they may be cast, if the owners
do not claim them within six months. If such owners claim them, they shall
pay the expenses incurred in gathering them or putting them in a safe
place. (369a)

Article 461. River beds which are abandoned through the natural change in
the course of the waters ipso facto belong to the owners whose lands are
occupied by the new course in proportion to the area lost. However, the
owners of the lands adjoining the old bed shall have the right to acquire the
same by paying the value thereof, which value shall not exceed the value of
the area occupied by the new bed. (370a)

Comments:

       What if river totally dries up? See Republic v. Santos III[6] G.R. No. 160453,
November 12, 2012

       Requisites: 1. Change must be sudden; 2. Change must be more or less

permanent; 3. Change of course must be due to natural causes; there must be
abandonment by government; 4. River must continue to exist

       Abandonment by Government
Article 462. Whenever a river, changing its course by natural causes, opens
a new bed through a private estate, this bed shall become of public
dominion. (372a)

Article 463. Whenever the current of a river divides itself into branches,

leaving a piece of land or part thereof isolated, the owner of the land
retains his ownership. He also retains it if a portion of land is separated
from the estate by the current. (374)

Article 464. Islands which may be formed on the seas within the jurisdiction
of the Philippines, on lakes, and on navigable or floatable rivers belong to
the State. (371a)

Article 465. Islands which through successive accumulation of alluvial

deposits are formed in non-navigable and non-floatable rivers, belong to
the owners of the margins or banks nearest to each of them, or to the
owners of both margins if the island is in the middle of the river, in which
case it shall be divided longitudinally in halves. If a single island thus
formed be more distant from one margin than from the other, the owner of
the nearer margin shall be the sole owner thereof. (373a)

SECTION 3

Right of Accession with Respect to Movable Property

Article 466. Whenever two movable things belonging to different owners

are, without bad faith, united in such a way that they form a single object,
the owner of the principal thing acquires the accessory, indemnifying the
former owner thereof for its value. (375)

Article 467. The principal thing, as between two things incorporated, is

deemed to be that to which the other has been united as an ornament, or
for its use or perfection. (376)

Article 468. If it cannot be determined by the rule given in the preceding

article which of the two things incorporated is the principal one, the thing
of the greater value shall be so considered, and as between two things of
equal value, that of the greater volume.

In painting and sculpture, writings, printed matter, engraving and

lithographs, the board, metal, stone, canvas, paper or parchment shall be
deemed the accessory thing. (377)

Article 469. Whenever the things united can be separated without injury,

their respective owners may demand their separation.
Nevertheless, in case the thing united for the use, embellishment or
perfection of the other, is much more precious than the principal thing, the
owner of the former may demand its separation, even though the thing to
which it has been incorporated may suffer some injury. (378)

Article 470. Whenever the owner of the accessory thing has made the
incorporation in bad faith, he shall lose the thing incorporated and shall
have the obligation to indemnify the owner of the principal thing for the
damages he may have suffered.

If the one who has acted in bad faith is the owner of the principal thing, the
owner of the accessory thing shall have a right to choose between the
former paying him its value or that the thing belonging to him be separated,
even though for this purpose it be necessary to destroy the principal thing;
and in both cases, furthermore, there shall be indemnity for damages.

If either one of the owners has made the incorporation with the knowledge
and without the objection of the other, their respective rights shall be
determined as though both acted in good faith. (379a)

Article 471. Whenever the owner of the material employed without his

consent has a right to an indemnity, he may demand that this consist in the
delivery of a thing equal in kind and value, and in all other respects, to that
employed, or else in the price thereof, according to expert appraisal. (380)

Article 472. If by the will of their owners two things of the same or different
kinds are mixed, or if the mixture occurs by chance, and in the latter case
the things are not separable without injury, each owner shall acquire a right
proportional to the part belonging to him, bearing in mind the value of the
things mixed or confused. (381)

Article 473. If by the will of only one owner, but in good faith, two things of
the same or different kinds are mixed or confused, the rights of the owners
shall be determined by the provisions of the preceding article.

If the one who caused the mixture or confusion acted in bad faith, he shall
lose the thing belonging to him thus mixed or confused, besides being
obliged to pay indemnity for the damages caused to the owner of the other
thing with which his own was mixed. (382)

Article 474. One who in good faith employs the material of another in whole
or in part in order to make a thing of a different kind, shall appropriate the
thing thus transformed as his own, indemnifying the owner of the material
for its value. If the material is more precious than the transformed thing or
is of more value, its owner may, at his option, appropriate the new thing to
himself, after first paying indemnity for the value of the work, or demand
indemnity for the material.

If in the making of the thing bad faith intervened, the owner of the material
shall have the right to appropriate the work to himself without paying
anything to the maker, or to demand of the latter that he indemnify him for
the value of the material and the damages he may have suffered. However,
the owner of the material cannot appropriate the work in case the value of
the latter, for artistic or scientific reasons, is considerably more than that of
the material. (383a)

Article 475. In the preceding articles, sentimental value shall be duly

appreciated. (n)

CHAPTER 3

Quieting of Title (n)

Article 476. Whenever there is a cloud on title to real property or any

interest therein, by reason of any instrument, record, claim, encumbrance
or proceeding which is apparently valid or effective but is in truth and in
fact invalid, ineffective, voidable, or unenforceable, and may be prejudicial
to said title, an action may be brought to remove such cloud or to quiet the
title.

An action may also be brought to prevent a cloud from being cast upon
title to real property or any interest therein.

Article 477. The plaintiff must have legal or equitable title to, or interest in
the real property which is the subject matter of the action. He need not be
in possession of said property.

Article 478. There may also be an action to quiet title or remove a cloud

therefrom when the contract, instrument or other obligation has been
extinguished or has terminated, or has been barred by extinctive
prescription.

Article 479. The plaintiff must return to the defendant all benefits he may
have received from the latter, or reimburse him for expenses that may have
redounded to the plaintiff’s benefit.

Article 480. The principles of the general law on the quieting of title are
hereby adopted insofar as they are not in conflict with this Code.
Article 481. The procedure for the quieting of title or the removal of a cloud
therefrom shall be governed by such rules of court as the Supreme Court
shall promulgated.

Comments:

       Does the action to quiet title prescribe?

If plaintiff in possession – Imprescriptible

If plaintiff not in possession- Prescribes in 10 or 30 years depending on ordinary

or extraordinary prescription. See Art 1134

Article 476. Quieting of Title;

Requisites

“For an action to quiet title to prosper, two indispensable requisites must concur,
namely: (1) that plaintiff or complainant has a legal or equitable title to or
interest in the real property subject of the action; and (2) the deed, claim,
encumbrance, or proceeding claimed to be casting cloud on his title must
be shown to be in fact invalid or inoperative despite its prima facie
appearance of validity or legal efficacy.

Xxx

Additionally, it is well to emphasize that in order that an action for quieting of title
may prosper, it is essential that the plaintiff must have legal or equitable title to,
or interest in, the property which is the subject-matter of the action. Legal title
denotes registered ownership, while equitable title means beneficial ownership.
In the absence of such legal or equitable title, or interest, there is no cloud to be
prevented or removed. ~Desiderio Dalisay Investments, Inc. v. Social
Security System, G.R. No. 2310513, April 04, 2018

CHAPTER 4
Ruinous Buildings and Trees in Danger of Falling

Article 482. If a building, wall, column, or any other construction is in

danger of falling, the owner shall be obliged to demolish it or to execute the
necessary work in order to prevent it from falling.
If the proprietor does not comply with this obligation, the administrative
authorities may order the demolition of the structure at the expense of the
owner, or take measures to insure public safety. (389a)

Article 483. Whenever a large tree threatens to fall in such a way as to

cause damage to the land or tenement of another or to travelers over a
public or private road, the owner of the tree shall be obliged to fell and
remove it; and should he not do so, it shall be done at his expense by order
of the administrative authorities. (390a)

TITLE III
CO-OWNERSHIP

Article 484. There is co-ownership whenever the ownership of an undivided

thing or right belongs to different persons.

In default of contracts, or of special provisions, co-ownership shall be

governed by the provisions of this Title. (392) 

Comment:

       Co-ownership v. corporation or partnership

       Can a co-ownership sue as such?

Article 485. The share of the co-owners, in the benefits as well as in the

charges, shall be proportional to their respective interests. Any stipulation
in a contract to the contrary shall be void.

The portions belonging to the co-owners in the co-ownership shall be

presumed equal, unless the contrary is proved. (393a)

Article 486. Each co-owner may use the thing owned in common, provided
he does so in accordance with the purpose for which it is intended and in
such a way as not to injure the interest of the co-ownership or prevent the
other co-owners from using it according to their rights. The purpose of the
co-ownership may be changed by agreement, express or implied. (394a)

Article 487. Any one of the co-owners may bring an action in ejectment. (n) 

Comment:

The word “ejectment” is used in its loose or generic sense to include:

forcible entry, unlawful detainer, accion publiciana, accion de reivindicacion

        As a rule, a co-owner may bring such an action without the necessity of
joining all the other co-owners as co-plaintiffs because the suit is presumed to
have been filed to benefit his co-owners.

Presupposes that the plaintiff recognizes the co-ownership. “Where the suit is for
the benefit of the plaintiff who alone claims to be the sole owner and entitled to
the possession of the litigated property, the action should be
dismissed”[7]. ~Arnelito Adlawan v. Emeterio M. Adlawan, G.R. No. 161916,
January 20, 2006

Article 488. Each co-owner shall have a right to compel the other co-
owners to contribute to the expenses of preservation of the thing or right
owned in common and to the taxes. Any one of the latter may exempt
himself from this obligation by renouncing so much of his undivided
interest as may be equivalent to his share of the expenses and taxes. No
such waiver shall be made if it is prejudicial to the co-ownership. (395a)

 Article 489. Repairs for preservation may be made at the will of one of the
co-owners, but he must, if practicable, first notify his co-owners of the
necessity for such repairs. Expenses to improve or embellish the thing
shall be decided upon by a majority as determined in article 492. (n)

 Article 490. Whenever the different stories of a house belong to different

owners, if the titles of ownership do not specify the terms under which they
should contribute to the necessary expenses and there exists no
agreement on the subject, the following rules shall be observed:

(1) The main and party walls, the roof and the other things used in
common, shall be preserved at the expense of all the owners in proportion
to the value of the story belonging to each;

(2) Each owner shall bear the cost of maintaining the floor of his story; the
floor of the entrance, front door, common yard and sanitary works common
to all, shall be maintained at the expense of all the owners pro rata;

(3) The stairs from the entrance to the first story shall be maintained at the
expense of all the owners pro rata, with the exception of the owner of the
ground floor; the stairs from the first to the second story shall be
preserved at the expense of all, except the owner of the ground floor and
the owner of the first story; and so on successively. (396)
Article 491. None of the co-owners shall, without the consent of the others,
ma

Query: May an alien acquire a condominium under Philippine law?

REPUBLIC ACT NO. 4726 June 18, 1966

AN ACT TO DEFINE CONDOMINIUM, ESTABLISH REQUIREMENTS FOR ITS

CREATION, AND GOVERN ITS INCIDENTS.

Sec. 1. The short title of this Act shall be “The Condominium Act”.

Sec. 2. A condominium is an interest in real property consisting of separate

interest in a unit in a residential, industrial or commercial building and an
undivided interest in common, directly or indirectly, in the land on which it is
located and in other common areas of the building. A condominium may include,
in addition, a separate interest in other portions of such real property. Title to the
common areas, including the land, or the appurtenant interests in such areas,
may be held by a corporation specially formed for the purpose (hereinafter known
as the “condominium corporation”) in which the holders of separate interest shall
automatically be members or shareholders, to the exclusion of others, in
proportion to the appurtenant interest of their respective units in the common
areas.

The real right in condominium may be ownership or any other interest in real
property recognized by law, on property in the Civil Code and other pertinent
laws.

Sec. 3. As used in this Act, unless the context otherwise requires:

(a) “Condominium” means a condominium as defined in the next preceding

section.

(b) “Unit” means a part of the condominium project intended for any type of
independent use or ownership, including one or more rooms or spaces located in
one or more floors (or part or parts of floors) in a building or buildings and such
accessories as may be appended thereto.

(c) “Project” means the entire parcel of real property divided or to be divided in
condominiums, including all structures thereon,

(d) “Common areas” means the entire project excepting all units separately
granted or held or reserved.
(e) “To divide” real property means to divide the ownership thereof or other
interest therein by conveying one or more condominiums therein but less than
the whole thereof.

Sec. 4. The provisions of this Act shall apply to property divided or to be divided
into condominiums only if there shall be recorded in the Register of Deeds of the
province or city in which the property lies and duly annotated in the
corresponding certificate of title of the land, if the latter had been patented or
registered under either the Land Registration or Cadastral Acts, an enabling or
master deed which shall contain, among others, the following:

(a) Description of the land on which the building or buildings and improvements
are or are to be located;

(b) Description of the building or buildings, stating the number of stories and
basements, the number of units and their accessories, if any;

(c) Description of the common areas and facilities;

(d) A statement of the exact nature of the interest acquired or to be acquired by

the purchaser in the separate units and in the common areas of the condominium
project. Where title to or the appurtenant interests in the common areas is or is to
be held by a condominium corporation, a statement to this effect shall be
included;

(e) Statement of the purposes for which the building or buildings and each of the
units are intended or restricted as to use;

(f) A certificate of the registered owner of the property, if he is other than those
executing the master deed, as well as of all registered holders of any lien or
encumbrance on the property, that they consent to the registration of the deed;

(g) The following plans shall be appended to the deed as integral parts thereof:

(1) A survey plan of the land included in the project, unless a survey plan of the
same property had previously bee filed in said office;

(2) A diagrammatic floor plan of the building or buildings in the project, in

sufficient detail to identify each unit, its relative location and approximate
dimensions;

(h) Any reasonable restriction not contrary to law, morals or public policy
regarding the right of any condominium owner to alienate or dispose of his
condominium.
The enabling or master deed may be amended or revoked upon registration of
an instrument executed by the registered owner or owners of the property and
consented to by all registered holders of any lien or encumbrance on the land or
building or portion thereof. The term “registered owner” shall include the
registered owners of condominiums in the project. Until registration of a
revocation, the provisions of this Act shall continue to apply to such property.

Sec. 5. Any transfer or conveyance of a unit or an apartment, office or store or

other space therein, shall include the transfer or conveyance of the undivided
interests in the common areas or, in a proper case, the membership or
shareholdings in the condominium corporation: Provided, however, That where
the common areas in the condominium project are owned by the owners of
separate units as co-owners thereof, no condominium unit therein shall be
conveyed or transferred to persons other than Filipino citizens, or corporations at
least sixty percent of the capital stock of which belong to Filipino citizens, except
in cases of hereditary succession. Where the common areas in a condominium
project are held by a corporation, no transfer or conveyance of a unit shall be
valid if the concomitant transfer of the appurtenant membership or stockholding
in the corporation will cause the alien interest in such corporation to exceed the
limits imposed by existing laws. X x x” End