TABLE OF CONTENTS

(a) Marcelo R. Soriano vs. Sps. Ricardo and Dalicano, Catherine Rona
Rosalina Galit, G.R. No. 156295, September 23,
2003;

(b) Serg's Products vs. PCI Leasing and Finance, Rizon, Louray
GR# 137705, Aug. 22, 2000;

(c) FELS Energy, Inc. vs. Province of Batangas, Wahing, Rose Christel
GR Nos. 168557, Feb. 16, 2007;

(d) Francisco I. Chavez vs. Public Estates Villacastin, Franklin

Authority, G.R. No. 133250, July 9, 2002;

(e) Manila Electric Company v. The City Sarigumba, Miguel Louie III
Assessor, G.R. No. 166102, August 5, 2015

(f) Philippine Ports Authority vs. City of Iloilo, Acebuche, Larrydelle

G.R. No. 109791, July 14, 2003;

(g) Francisco I. Chavez vs. Public Estates Camandona, Nina Mae

Authority, G.R. No. 133250, Nov. 11, 2003;

(h) Mactan Cebu International Airports Authority Villmor, Patricia

v. City of LapuLapu, G.R. No. 181756, June 15,
2015;

(i) In Re: Reversion/Recall of Reconstituted Godinez, Theresa

Titles in Tarlac Registry of Deeds, G.R. No. 171304,
Oct. 10, 2007;

(j) Heirs of Mario Malabanan v. Republic of the Pepito, Arvie

Philippines, G.R. No. 179987, April 29,2009

(k) Heirs of Mario Malabanan v. Republic of the Hadjirul, Danica Zharifa

Philippines, G.R. No. 179987, September 3, 2013;

(l) Dream Village Association v. Bases Gasper, Era

Conversion Development Authority, G.R. No. 192896,
July 24, 2013;

(m) Candelaria Dayot vs. Shell Chemical Co. (Phils.), Manguilimotan, Kaye C
Inc., G.R. No. 156542, June 26, 2007;
(n) Sps. Dario and Matilde Lacap vs. Jouvet Ong Binahon, Bethel Charisse
Lee, G.R. No. 142131, Dec. 11, 2002;

(o) National Housing Authority vs. Grace Baptist Mapalo, Ella

Church, G.R. No. 156437, Mar. 1, 2004;

(p) PNB vs. Generoso De Jesus, G.R. No. Abad, Jeasel

149295, September 23, 2003;

(q) Luis Marcos P. Laurel v. Hon. Zeus Abrogar, Aguirre, Dorothy Lois
et. al., G.R. No. 155076, February 27, 2006;

(r) Philippine Long Distance Telephone Company, v. Angco, Agnes

Abigail Razon Alvarez, et. al., G.R. No. 179408, March 5,
2014;

(s) Alfredo Yasay Del Rosario vs. Sps. Jose and Kilaton, Miame Luna L.
Concordia Manuel, G.R. No. 153652, January 16,
2004;

(t) National Housing Authority vs. Grace Baptist Bontes, Jhoronnie

Church, G.R. No. 156437, Mar. 1, 2004;

(u) Rachel C. Celestial vs. Jesse Cachopero, Cal, Jezreel Minelle

GR# 142595, Oct. 15, 2003;

(v) General Mariano Alvarez Services Cooperative, Inc., Cornelio, Jennyl

v. National Housing Authority, et. al., G.R. No. 175417,
February 9, 2015;

(w) Sps. Beder Morandarte & Marina Febrera. vs. de Pedro, Rosemarie
Court of Appeals, G.R. No. 123586, August 12, 2004;

(x) Julita V. Imuan, Et. Al., vs. Juanito Cereno, Et. Dimapinto, Samson kNihar
Al., G.R. No. 167995, Sept. 11, 2009;

(y) Heirs of Susana De Guzman Tuazon vs. CA, Gamayon, Jeanne Aurice
G.R. No. 125758, January 20, 2004;

(z) Agnes Gapacan, vs. Maria Gapacan Omipet, Ibarra, Caesarie Kae
G.R. No. 148943, August 15, 2002;

(aa) Lucio Robles vs. Court of Appeals, G.R. No. Jonson, Christine
123509, March 14, 2000

(bb) Efren Tandog, et al. vs. Renato Macapagal, et Jucutan, Maria Carla
al., G.R. No. 144208, Sept. 11, 2007;

(cc) Rosalina Clado-Reyes vs. Sps. Julius and Lily Jumagdao, Jan Julia
Limpe, G.R. No. 163876, July 9, 2008

(dd) Heirs of Enrique Diaz v. Virata, G.R. No. Ladub, Franchesca Bea
162037, August 7, 2006;

(ee) Rosalina Clado-Reyes vs. Sps. Julius and Lily Miranda, Fevi
Limpe, G.R. No. 163876, July 9, 2008; and

(ff) Heirs of Enrique Diaz v. Virata, G.R. No. Juanillo, Althea

162037, August 7, 2006;

(gg) Ayala Corporation v. Rosa Diana Realty and Pamine, Sunshine

Development Corp., G.R. No. 134284, Decebmer 1,
2000;

(hh) Department of Eductation v. Delfina C. Paracuelles, Reden Jalyn

Casibang, et. al., G.R. No. 192268, January 27,
2016VSD

(ii) Heirs of Victorino Sarili v. Pedro F. Lagrosa, Pardenilla, Jennifer

G.R. No.193517, January 15, 2014;

(jj) Heirs of Cipriano Trazona v. Heirs of Dionisio Penalosa, Belle Marie

Canada, et. al., G.R. No.175874, December 11,
2013;

(kk) Sps. Marcos Esmaquel and Victoria Soldevilla Pepito, Victoria Ashley
v. Maria Coprada, G.R. No. 152423, December 15,
2010;

(ll) Communities Cagayan, Inc. v. Sps. Arsenio Plantar, Krizziane Katrina

Nanol, et. al., G. R. No. 176791, November 14, 2012;

(mm) Automat Realty and Development Corporation, et. al., Ranario, Charmaine Hope
v. Spouses Marciano and Ofelia dela Cruz, G.R. No. 192026,
October 1, 2014;

(nn) Rodolfo and Lily Rosales v. Miguel Casteltort, Regidor, Maristela

et. al., G.R. No. 157044, October 5, 2005;
(oo) Spouses Crispin and Teresa Aquino v. Spouses Nisnisan, Dawn Gelianne
Eusebio and Josefina Aguilar, G.R. No. 182754, June 29,
2015; and

(pp) VSD Realty & Development Corp., v. Uniwide Sales, Pizon, Bea Gabrielle
Inc., G.R. No. 170677, October 24, 2012; but note the SC’s
Resolution on Motion for Reconsideration in VSD Realty &
Development Corp., v. Uniwide Sales, Inc., G.R. No. 170677,

(a) Republic of the Philippines v. Hon. Normelito Reyes, Janssen Reyna

J. Ballocanag, et. al., GR No. 163794, November 28,
2008;

(b) Midway Maritime & Technological Foundation, Destajo, Leslie Ann

Inc., v. Marissa E. Castro, GR No. 189061, August 6,
2014;

(c) Heirs of Joaquin Limense v. Rita Vda. De Sagarino, Dapnee

Ramos, et. al., GR No. 152319, October 28, 2009;

(d) Serafin Cheng v. Spouses Vittorio and Ma. Saumay, Norjana

Helen Donini, GR No. 167017, June 22, 2009;

(e) Eden Ballatan, et. al., v. Court of Appeals, et. Soriano Alyssa Chantelle
al., GR No. 125683, March 2, 1999; Deb

(f) Mercy Vda. De Roxas, v. Our Lady’s Tapulado, Cathyrine

Foundation, Inc., GR No. 182378, March 6, 2013;

(g) Heirs of Emiliano Navarro v. Intermediate Delan, John Lee

Appellate Court, et. al., GR No. 68166, February 12,
1997;

(h) Heirs of Francisco Narvasa, et. al., v. Emiliana Dungog, Franklin

Imbornal, et. al., G.R. No. 182908, August 6, 2014;

(i) Spouses Crispin & Caridad Galang v. Laurente, Christopher

Spouses Conrado & Fe Reyes, GR No. 184746,
August 8, 2012;

(j) Wilfredo & Lolita Vagilidad, v. Gabino & Anore, Mario

Dorothy Vagilidad, GR No. 161136, November 16,
2006;
(k) Vicente Torres, Jr., et. al., v. Lorenzo Lapinid, Batulan, Paulo
et. al., GR No. 187987, November 26, 2014;

(l) Vilma Quintos, et. al., v. Pelagia Nicolas, et. De Aroz, Kevin
al., GR No. 210252, June 16, 2014;

(m) Manuel T. De Guia vs. Court of Appeals, GR # dela Torre, Harvey

120864, October 8, 2003;

(n) Spouses Charlito & Anne Coja, v. Court of Pangilinan, Jude Kenneth
Appeals, et. al., GR No. 151153, December 10, 2007;

(o) Spouses Jose and Hermogena Engreso v. Rances, Ranche Rik

Herminio and Nestoria dela Cruz, GR No. 148727,
April 9, 2003;

(p) Leonor B. Cruz, v. Teofila M. Catapang, GR Rodriguez, Jeric

No. 164110, February 12, 2008;

(q) Corinthian Realty vs. Court of Appeals, G.R. Estrera, Kelvin

No. 150240, Dec. 26, 2002;

(r) Carolina Vda. De Figuracion, et. al., v. Emilia Montecillo, Danilo

Figuracion-Gerilla, GR No. 151334, February 13,
2013;

(s) Benjamin Coronel vs. Florentino Constantino, Suson, Kevin

GR# 121069, Feb 7, 2003;

(t) City of Mandaluyong vs. Antonio N. Aguilar, Urot, Dave Anthony

GR# 137152, Jan. 29, 2001;

(u) Lilia San Perez, Khim Rey

chez vs. Court of Appeals, G.R. No. 152766, June
20, 2003;

(v) Reynaldo Aguirre vs. Court of Appeals, G.R. Saavedra, Patrick

No. 122249, Jan. 29, 2004;

(w) Sps. Alexander and Adelaida Cruz vs. Eleuterio Tabanao, Arlan
Leis, G.R. No. 125233, March 9, 2000;

(x) Teresita S. Reyes-De Leon vs. Vicente B. Del Tomilap, Bhenz Brylle
Rosario, G.R. No. 152862, July 26, 2004;

(y) Agueda De Vera vs. Court of Appeals, G.R. Tomol, Angelo Gabriel
No. 97761, April 14, 1999;
(z) Sps. Dario and Matilde Lacap vs. Jouvet Ong Vilbar, Jairus
Lee, G.R. No. 142131, Dec. 11, 2002;

(aa) CIR vs. Solidbank Corp., G.R. No. 148191, Abangan, Shaira Christy
Nov. 25, 2003;

(bb) Republic of the Phils. vs. Jerry V. David, G.R. Calderon, Chatch
No. 155634, August 16, 2004;

(cc) Commissioner of Internal Revenue vs. Adolfo, Dawn Maryam

Solidbank Corp., G.R. No. 148191, November 25,
2003;

(dd) Jose C. Lee vs. RTC of Quezon City Branch Aliman, Marie Dess
85, G.R. No. 146006, February 23, 2004;

(ee) Fernanda Mendoza Cequena vs. Honorata Bolano, Joanne

Mendoza Bolante, G.R. No. 137944, April 6, 2000;

(ff) Philippine Trust Co. vs. Court of Appeals, Abella, Allain Jon Carlo
G.R. No. 124658, Dec. 15, 1999;

(gg) Fernanda Mendoza Cequena vs. Honorata Edullantes, Surmita Zoe

Mendoza Bolante, G.R. No. 137944, April 6, 2000;

(hh) BPI Family Bank vs. Amado Franco, et al., G.R. Flores Rosemarie
No. 123498, November 23, 2007;

Nailon, Darline Grace

(a) Edilberto Alcantara vs. Cornelio B. Reta, Jr., Alvarez, Camela Hope
GR# 136996, Dec. 14, 2001;

(b) Bryan U. Villanueva vs. Tirso D.C. Velasco, Amistad, Alyssa Kirsten
G.R. No. 130845, Nov. 27, 2000;

(c) National Irrigation Administration vs. Court of Amper, Kimberly Lourdes

Appeals, G.R. No. 114348, September 20, 2000; Tina

(d) National Power Corporation vs. Sps. Jose & Arab, Alaniah
Ma. Clara Campos, G.R. No. 143643, June 27, 2003;

(e) Bogo-Medellin Milling Co. vs. Court of Badal, Lea Faye

Appeals, G.R. No. 124699, July 31, 2003;
(f) Sps. Manuel and Rosalinda P. Mejorada vs. Yntig, Krista May
Glorificacion Vertudazo, et al., G.R. No. 151797, October 11,
2007;

(g) Woodbridge School, Inc., et al. vs. ARB Amanense, Bryan

Construction Co., Inc., G.R. No. 157285, February
16, 2007;

(h) Ma. Linda T. Almendras vs. Court of Appeals, Durato, Germe Noah
GR No. 110067, Aug. 3, 1998;

(i) Anastacia Quimen vs. Court of Appeals, G.R. Ursal, Regino

No. 112331, May 29, 1996;

(j) Tomas Encarnacion vs. Court of Appeals, Tria, Ninotchka

G.R. No. 77628, March 11, 1991;

(k) Celestino Tatel vs. Municipality of Virac, G.R. Torrefranca, Ian Kharlo
No 40243, March 11, 1992;

(l) Camilo E. Tamin vs. Court of Appeals, G.R. Tan, Aljon

No 97477, May 8, 1992;

(m) Spouses Rosario and Wilson Uy, et. al., v. Spouses Eleccion, Eric
Reynaldo and Lina Rana, G.R. No. 192862, June 30, 2014;

(n) Unisource Commercial and Development Inot, Rene

Corporation v. Joseph Chung, et. al., G.R. No.
173252, July 17, 2002;

(o) Pilar Development Corporation v. Ramon Lufrangco, Philips

Dumadag, et. al., G.R. No. 194336, March 11, 2013;

(p) Felicitas B. Borbajo v. Hidden View Penaranda, Michael Ian

Homeowners, Inc., et. al., G.R. No. 152440, January
31, 2005;

(q) Crispin Dichoso, Jr., et. al., v. Patrocinio L. Canonigo, Elizabeth

Marcos, G.R. No. 180282, April 11, 2011;

(r) Bogo-Medellin Million Co., Inc., v. Court of Batandolo, Krizabelle

Appeals, et. al., G.R. No. 124699, July 31, 2003;

(s) Republic of the Philippines v. Spouses Colong, Aleijah

Idelfonso & Francia Regulto, G.R. No. 202051, April Ummiessalam
18, 2016;
(t) Alicia B. Reyes v. Spouses Francisco S. Contado, Janjan
Valentin and Anatalia Ramos, G.R. No. 194488,
February 11, 2015;

(u) Helen Calimoso, et. al., v. Axel D. Roullo, Diwag, Kyrie Leonelyn
G.R. No. 198594, January 25, 2016;

(v) Woodridge School, Inc., v. ARB Construction Dizon, Maica Carmel Shirl
Co., Inc., G.R. No. 157285, February 16, 2007;

(w) Demetria De Guzman, et. al., v. Filinvest Dumaba, Anderson

Development Corportion, G.R. No. 191710, January
14, 2015;

(x) CJ Yulo & Sons, Inc., v. Roman Catholic Licup-Romares, Melcah

Bishop of San Pablo, Inc., G.R. No. 133705, March Joyce
31, 2005;

(y) Gonzalo Villanueva v. Spouses Froilan and Lumantao, Raymund

Leonila Branoco, G.R. No. 172804, January 24,
2011;

(z) Corazon Catalan, et. al., v. Jose Basa, et. al., Lumogdang, Lian Mae
G.R. No. 159567, July 31, 2007;
 Marcelo R. Soriano vs. Sps. Ricardo and Rosalina Galit,
G.R. No. 156295, September 23, 2003;
Contributor: Dalicano, Catherine Rona C.

Question:

A contracted a loan from B. This loan is secured by a real estate mortgage over a parcel of land.
B demanded payment for the loan from A. A failed to pay his loan. B then filed a complaintfor a
sum of money against A before the RTC. The trial court rendered judgment in favor of B and
issued a writ of execution in due course to levy the properties including the parcel of land covered
by TCT No. T-40785, a storehouse and a bodega against mortgagor A. Aggrieved, A filed a
petition for certiorari assailing the inclusion of the parcel of land. He further argued that the said
property was not among those sold on execution by the sheriff as reflected in the Certificate of
Sale on Execution of Real Property. Can the storehouse and bodega be mortgaged separately
from the land which it stands on?

Suggested Answer:

Yes, the storehouse and bodega can be mortgaged separately from the land which it
stands on.

Article 415 of the New Civil Code provides that, the following are immovable property:

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

(3) Everything attached to an immovable in a fixed manner, in such a way that it cannot
be separated therefrom without breaking the material or deterioration of the object;

(4) Statues, reliefs, paintings or other objects for use or ornamentation, placed in buildings
or on lands by the owner of the immovable in such a manner that it reveals the intention
to attach them permanently to the tenements;

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

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

(6) Animal houses, pigeon houses, beehives, fish ponds or breeding places of similar
nature, in case their owner has placed them or preserves them with the intention to have
them permanently attached to the land, and forming a permanent part of it; the animals in
these places are also included;
 In the case at bar, considering that what was sold by virtue of the writ of execution issued
by the trial court was merely the storehouse and bodega constructed on the parcel ofland covered
by Transfer Certificate of Title No. T-40785, which by themselves are real properties of A, the
same should be regarded as separate and distinct from the conveyance of the lot on which they
stand. While it is true that a mortgage of land necessarily includes, in the absence of stipulation
of the improvements thereon, buildings, still a building by itself may be mortgaged apart from the
land on which it has been built. Such mortgage would be still a real estate mortgage for the
building would still be considered immovable property even if dealt with separately and apart from
the land.

Therefore, the storehouse and bodega are, by itself, immovable properties.

 SERGS PRODUCTS, INC., and SERGIO T. GOQUIOLAY, Petitioners, vs. PCI LEASING
AND FINANCE, INC., Respondent.
G.R. No. 137705. August 22, 2000
Contributor: Rizon, Louray Maria L.
Question:

Datu Leasing Inc. filed an ex-parte application for a writ of replevin and directed its sheriff to seize
and deliver machineries and equipment leased by Ka Products Inc to the former. Granting the
application, the Trial Court issued the writ and ordered the sheriff to seize subject properties.
However, the sheriff only partially succeeded in the seizure because he was later denied entry
and was prevented from further taking equipment and machinery.

Ka Products Inc opposed the seizure stating that the machineries are immovable properties; thus,
not subject to a writ of replevin. On the other hand, Datu Leasing Inc. countered stating that they
have had prior agreement through a lease contract that the property shall at all times be and
remain, personal property even if the property or any part thereof become part or rests or affixed
in a real property or any building thereon or attached in any manner to what is permanent.

If you were the judge of the trial court, would you issue a writ of replevin?

Suggested Answer::

YES, I will issue a writ of replevin.

As enshrined in the Civil Code 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 are
considered as immovable property.

As a way of exception, contracting parties may validly stipulate that a real property be considered
as personal. After agreeing to such stipulation, they are consequently estopped from claiming
otherwise. Under the principle of estoppel, a party to a contract is ordinarily precluded from
denying the truth of any material fact found therein. However, the agreement shall not be binding
as far as third persons are concerned.

In the case at bar, even if the property are machinery which may fall under the classification of
immovable property under the Civil Code, the parties still entered into an agreement considering
the properties as movable. So, they are estopped from questioning otherwise. Thus, being a
personal property by virtue of the agreement entered into by the parties, I will issue a writ of
replevin.
 FELS Energy, Inc., petitioner, vs. Province of Batangas
G.R. No. 168557 February 16, 2007
Contributor: Villacastin, Franklin C.

Doctrine:

Article 415 (9) of the New Civil Code provides that “docks and structures which, though floating,
are intended by their nature and object to remain at a fixed place on a river, lake, or coast” are
considered immovable property.

Thus, power barges are categorized as immovable property by destination, being:

a. Nature – In the nature of machinery and other implements;

b. Intention – Intended by the owner for an industry or work;

c. Introduction – Which may be carried on in a building or on a piece of land; and

d. Needs – Which tend directly to meet the needs of said industry or work.

Question:

The National Power Corporation entered into a lease contract (Agreement for brevity) with Polar
Energy over a 3x30 Megawatt diesel engine power barges. Subsequent to the agreement, Polar
Energy assigned its rights under the Agreement to FELS Energy. Two years in operation FELS
received an assessment of real property taxes on the power barges from the Provincial Assessor.
FELS Energy referred the matter to the National Power Corporation, reminding it of its obligation
under the Agreement to pay all real estate taxes. NPC sought reconsideration of the Provincial
Assessor’s decision to assess real property taxes on the power barges. However, the motion was
denied, Provincial Assessor averred that the barges were real property for purposes of taxation
under Republic Act (R.A.) No. 7160, and the Provincial Assessor advised NPC to pay the
assessment. Are power barges real property?

Suggested Answer:

Yes. Power barges are real property.

Article 415 (9) of the New Civil Code provides that “docks and structures which, though floating,
are intended by their nature and object to remain at a fixed place on a river, lake, or coast” are
considered immovable property.
In the case at bar, power barges are installed at a specific location with the character of
permanency. Thus, power barges are categorized as immovable property by destination, being
in the nature of machinery and other implements intended by the owner for an industry or work
which may be carried on in a building or on a piece of land and which tend directly to meet the
needs of said industry or work.
 FRANCISCO I. CHAVEZ, petitioner, vs. PUBLIC ESTATES AUTHORITY and AMARI
COASTAL BAY DEVELOPMENT CORPORATION
G.R. No. 133250 July 9, 2002
Contributor: Wahing, Rose Christel C.

Doctrine:

The 1987 Constitution has adopted the Regalian doctrine which declares that all natural resources
are "owned by the State," and except for alienable agricultural lands of the public domain, natural
resources cannot be alienated. Article 339 of the Civil Code of 1889, which is now Article 420 of
the Civil Code of 1950, incorporated the Regalian doctrine. It provides that the following things
are property of public dominion: (1) Those intended for public use, such as roads, canals, rivers,
torrents, ports and bridges constructed by the State, banks, shores, roadsteads, and others of
similar character; (2) Those which belong to the State, without being for public use, and are
intended for some public service or for the development of the national wealth. Further, Section
3 Article XII of the 1987 Constitution states that private corporations or associations may not hold
such alienable lands of the public domain except by lease, subject to certain limitations. Article
341, now 422, of the Civil Code states that property of public dominion, when no longer devoted
to public use or to the defense of the territory, shall become a part of the private property of the
State. However, the legislature, or the executive department pursuant to law must declare the
property no longer needed for public use or territorial defense before the government could lease
or alienate the property to private parties.

Question:

President Marcos through a presidential decree created PEA, which was tasked with the
development, improvement, and acquisition, lease, and sale of all kinds of lands. The then
president also transferred to PEA the foreshore and offshore lands of Manila Bay under the
Manila-Cavite Coastal Road and Reclamation Project. Thereafter, PEA was granted patent to the
reclaimed areas of land and then, years later, PEA entered into a Joint Venture Agreement with
AMARI, a private corporation. Under the amended Joint Venture Agreement between AMARI and
PEA, several hectares of reclaimed lands comprising the Freedom Islands and several portions
of submerged areas of Manila Bay were going to be transferred to AMARI. These two entered
into a joint venture in the absence of any public bidding. Can the said lands be transferred to
AMARI?

Suggested Answer:

No, the said lands cannot be transferred to AMARI.

The 1987 Constitution has adopted the Regalian doctrine which declares that all natural resources
are "owned by the State," and except for alienable agricultural lands of the public domain, natural
resources cannot be alienated. Article 339 of the Civil Code of 1889, which is now Article 420 of
the Civil Code of 1950, incorporated the Regalian doctrine. It provides that the following things
are property of public dominion: (1) Those intended for public use, such as roads, canals, rivers,
torrents, ports and bridges constructed by the State, banks, shores, roadsteads, and others of
similar character; (2) Those which belong to the State, without being for public use, and are
intended for some public service or for the development of the national wealth. Further, Section
3 Article XII of the 1987 Constitution states that private corporations or associations may not hold
such alienable lands of the public domain except by lease, subject to certain limitations. Article
341, now 422, of the Civil Code states that property of public dominion, when no longer devoted
to public use or to the defense of the territory, shall become a part of the private property of the
State. However, the legislature, or the executive department pursuant to law must declare the
property no longer needed for public use or territorial defense before the government could lease
or alienate the property to private parties.

In the case at bar, the several hectares of reclaimed lands comprising the Freedom Islands, now
covered by certificates of title in the name of PEA, are alienable lands of the public domain. PEA
may lease these lands to private corporations but may not sell or transfer ownership of these
lands to private corporations. AMARI is a private corporation. In addition, several hectares of
submerged areas of Manila Bay remain inalienable natural resources of the public domain until
classified as alienable or disposable lands open to disposition and declared no longer needed for
public service. The government can make such classification and declaration only after PEA has
reclaimed these submerged areas. Only then can these lands qualify as agricultural lands of the
public domain, which are the only natural resources the government can alienate. In their present
state, these hectares of submerged areas are inalienable and outside the commerce of man.

Thus, the said lands cannot be transferred to AMARI.

 Manila Electric Company v. The City Assessor,
G.R. No. 166102, August 5, 2015
Contributor: Sarigumba, Miguel Louie III

QUESTION:

Electric Company X received a letter from the City Treasurer of Lucena, which stated that the
company was being assessed real property tax delinquency on its machineries (poles, wires,
insulators, transformers, and electric meters) beginning 1990. Electric Company X appealed
before the LBAA of Lucena City and asked the LBAA to cancel and nullify the Notice of
Assessment and declare the properties exempt from real property tax on the basis that (1) the
steel towers fell within the term "poles" expressly exempted from taxes under the its franchise;
and (2) the steel towers were personal properties under the provisions of the Civil Code and,
hence, not subject to real property tax. Is Electric Company X correct?

ANSWER:

NO. The poles, wires, insulators, transformers, and electric meters of Electric Company X were
real properties and may qualify as "machinery" subject to real property tax under the Local
Government Code.

While the Local Government Code still does not provide for a specific definition of "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 Civil Code enumerates those that are considered immovable property
(1) Land, buildings, roads and constructions of all kinds adhered to the soil;
(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
(5) Machinery, receptacles, instruments or implements intended by the owner of the tenement
for an industry or works which may be carried on in a building or on a piece of land, and which
tend directly to meet the needs of the said industry or works;

The Civil Code, however, does not define "machinery”.

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."
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.
 Philippine Ports Authority vs. City of Iloilo
G.R. No. 109791, July 14, 2003
Contributor: Acebuche, Ma. Larrydelle Lucero

Doctrine:

Classification of Property

Question:

A tax collection case filed in your court by the City of Beauty against the Philippine Port Authority
therein for real property tax of the same, and business tax for leasing the warehouse owned by
the said port authority. The latter invoked tax exemption for the port as it is a public dominion, as
well as the warehouse as it is a part thereof. As a judge, will you decide in favor of the Philippine
Port Authority, and consider the port and warehouse a public dominion, exempting them from real
property tax and business tax?

Suggested answer:

No. While it is true that ports constructed by the state are properties by public dominion, the
exemption of tax of GOCCs like Philippine Port Authority have been expressly withdrawn by the
Local Government Code, thus bars the claim of absolute exemption of government
instrumentalities from local taxation. The warehouse may not be held as part of the port,
considering its separable nature as an improvement upon the port, and the fact that it is not open
for use by everyone and freely accessible to the public. On the other hand, the exemption of public
property from taxation does not extend to improvements made thereon. Hence, PPA is still liable
for both real property and business tax.
 Francisco I. Chavez vs. Public Estates Authority
G.R. No. 133250, November 11, 2003
Contributor: Camandona, Nina Mae

QUESTION:

Public Estates Authority (PEA), under the JVA, obligated itself to convey title and possession over
the consisting of approximately (1,578,441) Square Meters for a total consideration of
(P1,894,129,200.00) Pesos, or a price of (P1,200.00) Pesos per square meter.

Under the Amended JVA, the PEA conveyed to Amari the submerged lands even before their
actual reclamation, although the documentation of the deed of transfer and issuance of the
certificates of title would be made only after actual reclamation. PEA also contributed its rights,
privileges and ownership over the Reclamation Area to the Joint Venture which is 70% owned by
Amari. Moreover, the PEA delegated to Amari the right and privilege to reclaim the submerged
lands.

Are the stipulations in the Amended JVA for the transfer to AMARI of lands, reclaimed or to be
reclaimed valid.

SUGGESTED ANSWER:

No. Submerged lands, like the waters (sea or bay) above them, are part of the State’s inalienable
natural resources. Submerged lands are property of public dominion, absolutely inalienable and
outside the commerce of man. This is also true with respect to foreshore lands. Any sale of
submerged or foreshore lands is void being contrary to the Constitution as it violates Section 2,
Article XII.

In the instant case, the bulk of the lands subject of the Amended JVA are still submerged lands,
and therefore inalienable and outside the commerce of man. Under the Amended JVA, the PEA
conveyed to Amari the submerged lands even before their actual reclamation, although the
documentation of the deed of transfer and issuance of the certificates of title would be made only
after actual reclamation.

Thus, title to the reclaimed lands remains with the PEA and the land covered by these certificates,
being alienable lands of the public domain, should not be sold to a private corporation.
 Mactan Cebu International Airports Authority v. City of LapuLapu
G.R. No. 181756, June 15, 2015
Contributor: Villamor, Faye Patricia V.

Question:

Petitioner Mactan-Cebu International Airport Authority (MCIAA) was created by Congress to

undertake the effective control and management and supervision of the Mactan International
Airport, Lahug Airport, and other airports as may be established by the Province of Cebu. MCIAA
enjoyed exemption from realty taxes as per RA 6958. However, the Supreme Court ruled in
another case that MCIAA was no longer exempt from real estate taxes upon the effectivity of the
Local Government Code of 1991.

Respondent City issued to MCIAA a Statement of Real Estate Tax assessment over the lots of
Mactan International Airport. But the Petitioner contends that the said lots are solely utilized solely
and exclusively for public purposes and should be exempt from real property tax, as per the DOJ
Opinion No. 50.

Is petitioner a government instrumentality exempt from paying real property taxes?

SUGGESTED ANSWER:

Yes. Petitioner is an instrumentality of the government.

Properties of instrumentalities of the government actually, solely and exclusively used for public
purposes are not subject to real property tax. If an instrumentality of the government leases real
property to a taxable person, such specific property leased becomes subject to real property tax.

In this case, its properties actually, solely and exclusively used for public purposes, consisting of
the airport terminal building, airfield, runway, taxiway and the lots on which they are situated, are
not subject to real property tax and respondent City is not justified in collecting taxes from
petitioner over said properties. The airport lands and buildings of MCIAA are properties of public
dominion because they are intended for public use. As properties of public dominion, they
indisputably belong to the State or the Republic of the Philippines, and are outside the commerce
of man. Thus, unless petitioner leases its real property to a taxable person, the specific property
leased becomes subject to real property tax; in which case, only those portions of petitioner's
properties which are leased to taxable persons like private parties are subject to real property tax
by the City of Lapu-Lapu.
 In Re: Reversion/Recall of Reconstituted Titles in Tarlac Registry of Deeds
G.R. No. 171304, Oct. 10, 2007
Contributor: Godinez, Theresa T.

QUESTION:

Mr. Aguilar, who recently discovered that the property where the school, public market, and public
cemetery was built by the Government of Paniqui during 1910, in which an OCTs No. R0-532 (O-
116) and No. 368 was issued, and was owned by his ascendants.

Thus, on 2005, Mr. Aguilar filed a Petition for Annulment of Judgment, declaring that they are the
true owner of the property under OCTs No. R0-532 (O-116) and No. 368. That his ascendants
were the original pioneers/settlers/occupants of the land where the subject property is built. That
his ascendants were not given chance or opportunity to appear or answer and present their side
at the cadastral proceedings involving the subject properties, from which resulted the issuance of
the OCTs in the name of the Municipality of Paniqui, because they were ordered to vacate the
property so that the municipality can build thereon a school, public market, and public cemetery.

If you are the judge, how will you decide the case.

SUGGESTED ANSWER:

If I were the judge, I would dismiss the petition.

On the basis that according to ART. 424. “Property for public use, in the provinces, cities, and
municipalities, consists 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."

Given that the school, public market, and public cemetery were built upon the subject property.
The determination of the persons allowed to study in such schools, or put up stalls in the public
market, or bury their dead in public cemeteries are regulated by the government. As such, the
subject property is, under the Civil Code classification, patrimonial property, and the Municipality
may have the same registered in its name.
 HEIRS OF MALABANAN V. REPUBLIC OF THE PHILIPPINES
G.R. No. 179987
Contributor: Pepito, Arvie D.

QUESTION:

On 20 February 1998, Mario Malabanan filed an application for land registration before the RTC
of Cavite-Tagaytay, covering a parcel of land situated in Silang Cavite. Malabanan claimed that
he had purchased the property from Eduardo Velazco, and that he and his predecessors-in-
interest had been in open, notorious, and continuous adverse and peaceful possession of the
land for more than thirty (30) years. Velazco testified that the property was originally belonged to
a twenty-two hectare property owned by his great-grandfather and upon his death, his four sons
inherited the property and divided it among themselves. Part of this property was later sold to
Malabanan. Among the evidence presented by Malabanan during trial was a Certification dated
11 June 2001, issued by the Community Environment & Natural Resources Office, Department
of Environment and Natural Resources (CENRO-DENR), which stated that the subject property
was “verified to be within the Alienable or Disposable land per Land Classification.” The RTC
approved the application for registration.

The Republic interposed an appeal to the Court of Appeals, arguing that Malabanan had failed to
prove that the property belonged to the alienable and disposable land of the public domain, and
that the RTC had erred in finding that he had been in possession of the property in the manner
and for the length of time required by law for confirmation of imperfect title. The CA reversed the
RTC ruling and dismissed the application.

Are lands of public domain, declared as alienable and disposable, susceptible to acquisition by
prescription

ANSWER:

In connection with Section 14(1) of the Property Registration Decree, Section 48(b) of the Public
Land Act recognizes and confirms that “those who by themselves or through their predecessors
in interest have been in open, continuous, exclusive, and notorious possession and occupation
of alienable and disposable lands of the public domain, under a bona fide claim of acquisition of
ownership, since June 12, 1945” have acquired ownership of, and registrable title to, such lands
based on the length and quality of their possession.

Since Section 48(b) merely requires possession since 12 June 1945 and does not require that
the lands should have been alienable and disposable during the entire period of possession, the
possessor is entitled to secure judicial confirmation of his title thereto as soon as it is declared
alienable and disposable, subject to the timeframe imposed by Section 47 of the Public Land Act.
In complying with Section 14(2) of the Property Registration Decree, consider that under the Civil
Code, prescription is recognized as a mode of acquiring ownership of patrimonial property.
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. 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
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.

It is clear that the evidence of petitioners is insufficient to establish that he has acquired ownership
over the subject property under Section 48(b) of the Public Land Act. There is no substantive
evidence to establish that Malabanan or petitioners as his predecessors-in-interest have been in
possession of the property since 12 June 1945 or earlier. The earliest that petitioners can date
back their possession, according to their own evidence—the Tax Declarations they presented in
particular—is to the year 1948. Thus, they cannot avail themselves of registration under Section
14(1) of the Property Registration Decree.

Neither can petitioners properly invoke Section 14(2) as basis for registration. While the subject
property was declared as alienable or disposable in 1982, there is no competent evidence that is
no longer intended for public use service or for the development of the national evidence,
conformably with Article 422 of the Civil Code. The classification of the
subject property as alienable and disposable land of the public domain does not change its status
as property of the public dominion under Article 420(2) of the Civil Code. Thus, it is insusceptible
to acquisition by prescription.
 HEIRS OF MARIO MALABANAN vs. REPUBLIC OF THE PHILIPPINES
G.R. No. 179987. September 3, 2013.
Contributor: Hadjirul, Danica Zharifa C.

QUESTION:

On February 20, 1998, A filed an application for original registration of title covering a parcel of
land in Silang, Cavite which he purchased from B and that he and his predecessors in interest
had been in open, notorious, exclusive and continuous possession of the said land for more than
30 years.

B, the vendor, alleges that this land was originally owned by his great-grandfather which passed
down to his four sons. By 1966, one of the sons became the administrator of the properties in
which the son of the latter succeeded his parents. One of the properties therein was the one sold
by the B.

They also presented evidence on the classification of land to be alienable and disposable by the
DENR on March 15, 1982.

The RTC ruled in favor of them, but the CA reversed the decision. Is A allowed to file an application
for the registration of the property by acquisition by prescription.

SUGGESTED ANSWER:

No. A is not allowed to file an application for registration.

Under the law, alienable and disposable agricultural land cannot be registered under Section
14(2) of the PRD solely because it is already alienable and disposable. The alienability must be
coupled with the required declaration under Article 422 of the Civil Code if the land is claimed to
be patrimonial and possession under Section 14(2) of the PRD is invoked as basis for registration.
Section 14(2) of the PRD will apply only after the land is deemed to be "private" or has passed
through one of the modes of grant and acquisition under the PLA, and after the requisite time of
possession has passed, counted from the time the land is deemed or recognized to be private.

In the case at bar, no extraordinary prescription can be recognized in their favor as their effective
possession could have started only after March 15, 1982. Based on the reasons and conclusions
in the above discussion, they have not complied with the legal requirements, either from the point
of view of the PLA or the Civil Code.

Therefore, it is insusceptible by acquisition by prescription.

 Dream Village Neighborhood Association Inc.
v. Bases Conversion Development Authority
G.R. No. 192896 July 24, 2013
Contributor: Gasper, Era R.

Question:

Dream Village Neighborhood Association represents more than 2,000 families who have been
occupying a 78,466- square meter lot in Western Bicutan, Taguig City since 1985 "in the concept
of owners continuously, exclusively and notoriously." The lot used to be a part of Hacienda de
Maricaban (Maricaban) covered under OCT No. 291. Following the purchase of Maricaban by the
USA early in the American colonial period, to be converted into the military reservation known as
Fort William Mckinley, OCT No. 291 was cancelled.

In 1986, President Ferdinand E. Marcos issued a proclamation declaring certain portions of Fort
Bonifacio alienable and disposable thus allowing the sale to the settlers of home lots in Upper
Bicutan, Lower Bicutan, Signal Village, and Western Bicutan.

In 1992, R.A. No. 7227 was passed creating the Bases Conversion and Development Authority
(BCDA) to oversee and accelerate the conversion of military reservations and their extension
camps to productive civilian uses.

The said law provides that the capital of the BCDA will be provided from sales proceeds or
transfers of lots in nine (9) military camps in Metro Manila, including 723 has. of Fort Bonifacio.
The law, thus, expressly authorized the President of the Philippines "to sell the above lands, in
whole or in part, which are hereby declared alienable and disposable pursuant to the provisions
of existing laws and regulations governing sales of government properties," specifically to raise
capital for the BCDA.

Does BCDA have right over the parcel of lands?

Suggested Answer:

Yes. Articles 420 and 421 identify what is property of public dominion and what is patrimonial
property: 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 being for public use, and are intended
for some public service or for the development of the national wealth.

Art. 421. All other property of the State, which is not of the characterstated in the preceding article,
is patrimonial property.
The moment R.A. No. 7227 was enacted, the subject military lands in Metro Manila became
alienable and disposable.

However, it was also clarified that the said lands did not thereby become patrimonial, since the
BCDA law makes the CIVIL LAW REVIEW SY 2019-2020 1ST SEMESTER 12 express
reservation that they are to be sold in order to raise funds for the conversion of the former
American bases in Clark and Subic. The Court noted that the purpose of the law can be tied to
either "public service" or "the development of national wealth" under Article 420 (2) of the Civil
Code, such that the lands remain property of the public dominion, albeit their status is now
alienable and disposable. The Court then explained that it is only upon their sale to a private
person or entity as authorized by the BCDA law that they become private property and cease to
be property of the public dominion.

Thus, under Article 422 of the Civil Code, public domain lands become patrimonial property only
if there is a declaration that these are alienable or disposable, together with an express
government manifestation that the property is already patrimonial or no longer retained for public
service or the development of national wealth. Only when the property has become patrimonial
can the prescriptive period for the acquisition of property of the public dominion begin to run.
 Candelaria Dayot vs. Shell Chemical Co. (Phils.), Inc.,
G.R. No. 156542, June 26, 2007
Manguilimotan, Kaye

Question:

Traders Royal bank was the highest bidder of an auction of a 6 foreclosed mortgaged property of
Panay Railways. Certificate of titles were transferred to Traders Royal bank. Part of the
mortgaged properties is occupied by Shell Chemical Inc. Traders Royal bank filed before the RTC
a petition for writ of Possession. Traders Royal bank sold 5 of the foreclosed mortgaged properties
to Spouses Dayot. Dayot filed for a supplemental motion praying to be the new petitioner of the
case filed by Traders Royal Bank and issue an alias writ of possession and that Shell be ejected.
Shell claims that it owns the property. Can a writ of possession be a means for Shell to be ejected
from the property?

Suggested Answer:

No, Shell cannot be ejected from the property by means of writ of possession.

Article 433 of the Civil Code states: Actual possession under claim of ownership raises a
disputable presumption of ownership. The true owner must resort to judicial process for the
recovery of the property.
One who claims to be the owner of a property possessed by another must bring the appropriate
judicial action for its physical recovery. The term "judicial process" could mean no less than an
ejectment suit or reivindicatory action, in which the ownership claims of the contending parties
may be properly heard and adjudicated.

In this case, Dayot cannot rely on the writ of possession since Shell raises a defense of actual
possession under claim of ownership. Writ of possession cannot be considered a judicial process
under Article 433 since it is a non-litigious proceeding authorized in an extra-judicial foreclosure
of mortgage.
 Sps. Dario and Matilde Lacap vs. Jouvet Ong
G.R. No. 142131, December 11, 2002;
Binahon, Bethel Charisse A.

Question:

Facundo mortgaged two parcels of land and the improvements thereon to ABC Bank. Marimar
assumed to pay Facundo’s mortgage obligation to the bank. However, Marimar failed to pay her
obligation to the bank and so they foreclosed on the mortgage. During the auction sale, the bank
emerged as the highest bidder and title passed on to it. The bank allowed Marimar to stay in the
premises as long as she pays monthly rentals. Marimar introduced improvements thereon relying
on the bank’s assurance that the property would be sold back to her. One day as she was about
to pay her monthly rent, the bank refused to accept the payment because the property had already
been sold to another person. Marimar is now asking the new owners to reimburse her in full for
the improvements she introduced in the property as a builder in good faith. The new owners
offered to reimburse only one-half of the value of the useful improvements since Marimar is a
lessee and not a builder in good faith under. Art. 448 vs Art. 1678
Is Marimar a builder in good faith?

Suggested Answer:

No, Marimar is not a builder in good faith.

Under the Civil Code, one of the options of the owner of the land on which anything has been built
in good faith, is to appropriate as his own the works after payment for indemnity. Builders in good
faith are entitled to reimbursement for necessary and useful expenses. Possession in good faith
continues to subsist until facts exist which show that the possessor is already aware that he
wrongfully possesses the thing.

In this case, Marimar was made to believe that she had a claim of title over the said property by
assuming the mortgage and possessing the subject property. All these changed when she started
paying monthly rentals to the mortgagee bank after the foreclosure of the said property. Her
possession in good faith continued to subsist until the fact that the bank foreclosed and acquired
the title over the mortgaged property existed.

Hence, she is a mere lessee and is only entitled to one-half of the value of the useful
improvements.
 National Housing Authority v. Grace Baptist Church and the Court of Appeals
G.R. No. 156437, March 1, 2004
Contributor: Mapalo, Ella Gabrielle M.

Question:

GBC, upon manifesting its interest to acquire the lots owned by the NHA, entered into possession
of said lots and introduced improvements thereon. GBC then tendered to the NHA a manager’s
check of P55,000 for the full payment of the lots. However, the NHA returned the check, stating
that the amount was insufficient considering that the price of the properties has changed. GBC
filed a complaint for specific performance against the NHA, but the Court ruled that there was no
perfected contract of sale and ordered the GBC to return possession of the property to the NHA.

1.) Can the NHA be compelled to sell the subject lots to GBC in the absence of any
perfected contract of sale between the parties?

2.) As landowner, what rights does the NHA have in relation to the improvements
introduced to the lots by GBC?

Suggested Answer:

1.) No, the NHA cannot be compelled to sell the subject lots to GBC absent a perfected
contract of sale.

Under the law, where there is no acceptance of an offer or if the offer is expressly rejected,
there is no meeting of the minds, making the contract inexistent. Consequently, such contract is
without force and effect from the very beginning. It also cannot be validated either by lapse of
time or ratification.

Here, the contract of sale supposedly entered into by GBC and the NHA is void and
inexistent because there was no meeting of the minds between the parties for lack of acceptance
of the offer. As such, their contract is void and of no effect. Thus, absent a contract of sale, there
is no binding effect that could compel the NHA to sell the subject lots to GBC.

2.) The NHA shall have the right to appropriate the improvements after payment of
indemnity to GBC, or to oblige the latter to pay the price of the land or to pay rent.

Applying Article 448 in relation to Article 453 of the Civil Code, and as stated by
jurisprudence, 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.
 Here, the GBC knew that there was no perfected contract of sale with the NHA, but it still
built improvements on the lots. Also, the NHA knowingly granted GBC use of the lots and did not
prevent the former from making improvements thereon. Thus, both having acted in bad faith, they
shall be treated as if they are in good faith. Article 448 applies where the NHA has the right to
appropriate the improvements after payment of indemnity to GBC, or to oblige the latter to pay
the price of the land or to pay rent.
 PNB vs. Generoso De Jesus, G.R. No. 149295, September 23, 2003;
Abad, Jease

Question:

Christian de Jesus acquired a parcel of land. After a verification survey, he found out the northern
portion of his property was encroached upon by a building of Lucifer Bank .He could not believe
it! He immediately sent a letter to Lucifer Bank to vacate the premises, but it did not heed. He sent
another letter, but to his disappointment, the bank did not comply. He now filed an action to the
Higher Court for recovery of ownership and possession. Lucifer Bank asserted that it acted in
good faith that when it acquired the lot and the building sometime in 1981 from then Mayor
Sauron, the encroachment already was in existence and to remedy the situation, Mayor Sauron
offered to sell the area in question (which then also belonged to Sauron) to petitioner at P100.00
per square meter which offer the latter claimed to have accepted. The sale, however, did not
materialize when Mayor Sauron later mortgaged the lot to the Development Bank of Mordor.

Is Lucifer Bank considered a builder in good faith ?

Answer:
No.

In reference to Article 448, et seq., of the Civil Code, a builder in good faith is one who, not being
the owner of the land, builds on that land believing himself to be its owner and unaware of any
defect in his title or mode of acquisition.

The essence of good faith lies in an honest belief in the validity of one’s right, ignorance of a
superior claim, and absence of intention to overreach another. Applied to possession, one is
considered in good faith if he is not aware that there exists in his title or mode of acquisition any
flaw which invalidates it. Evidently, Lucifer Bank was quite aware, and indeed advised, prior to its
acquisition of the land and building from Sauron that a part of the building sold to it stood on the
land not covered by the land conveyed to it.

Equally significant is the fact that the building, constructed on the land by Sauron, has in actuality
been part of the property transferred to Lucifer Bank . Article 448, of the Civil Code refers to a
piece of land whose ownership is claimed by two or more parties, one of whom has built some
works (or sown or planted something) and not to a case where the owner of the land is the builder,
sower, or planter who then later loses ownership of the land by sale or otherwise for, elsewise
stated, "where the true owner himself is the builder of works on his own land, the issue of good
faith or bad faith is entirely irrelevant."

In fine, the Lucifer Bank is not in a valid position to invoke the provisions of Article 448 of the Civil
Code. It fell short of its claim of good faith.
 LUIS MARCOS P. LAUREL, petitioner, vs. HON. ZEUS C. ABROGAR, Presiding Judge of
the Regional Trial Court, Makati City, Branch 150, PEOPLE OF THE PHILIPPINES &
PHILIPPINE LONG DISTANCE TELEPHONE COMPANY, respondents. (FIRST DIVISION)
G.R. No. 155076. February 27, 2006
and
LUIS MARCOS P. LAUREL, petitioner, vs. HON. ZEUS C. ABROGAR, Presiding Judge of
the Regional Trial Court, Makati City, Branch 150, PEOPLE OF THE PHILIPPINES &
PHILIPPINE LONG DISTANCE TELEPHONE COMPANY, respondents. (EN BANC)
G.R. No. 155076. January 13, 2009
Contributor: Aguirre, Dorothy Lois A.

Doctrines: The only requirement for a personal property to be the object of theft under the Penal
Code is that it be capable of appropriation. The business of providing telecommunication or
telephone service is likewise personal property which can be the object of theft under Article 308
of the Revised Penal Code.

Question:

Oldtown Tel Co. along with its board member Larrys Strong were filed a criminal case of Theft.
Accused with intent to gain and without the knowledge and consent of the Dragonstone Tel Co.
steal and use the international long distance calls belonging to Dragonstone Tel Co. by conducting
International Simple Resale (ISR), which is a method of routing and completing international long
distance calls using lines, cables, antenae, and/or air wave frequency which connect directly to
the local or domestic exchange facilities of the country where the call is destined, effectively
stealing this business from Dragonstone Tel Co. while using its facilities in the estimated amount
of P 236,091,188.40 to the damage and prejudice of Dragonstone Tel Co., in the said amount.

Are the international telephone calls using Oldtown Tel Co. through the telecommunication
services provided by Dragonstone Tel Co. for such calls, or, in short, Dragonstone Tel
Co.’s business of providing said telecommunication services, proper subjects of theft
under Article 308 of the Revised Penal Code?

Suggested Answer:

Yes, said business is a subject of theft.

Article 414 of the Civil Code provides that all things which are or may be the object of appropriation
are considered either real property or personal property. The general rule is that only movable
properties which have physical or material existence and susceptible of occupation by another
are proper objects of theft.

In the case at bar, Dragonstone Tel Co.’s business is likewise not enumerated as personal
property under the Civil Code, just like interest in business, however, it may be appropriated. It is
not necessary that the property be actually carried away out of the physical possession of the
Dragonstone Tel Co. by Oldtown Tel Co. or that the latter should have made his escape with it.
The act of conducting International Simple Resale (ISR) operations by illegally connecting various
equipment or apparatus to Dragonstone Tel Co.’s telephone system, through which Oldtown Tel
Co. is able to resell or re-route international long distance calls using Dragonstone Tel Co.’s
facilities constitutes theft.

Therefore, the business of providing telecommunication services are proper subjects of theft.
 Philippine Long Distance Telephone Company, v. Abigail Razon Alvarez, et. al.,
G.R. No. 179408, March 5, 2014
Contributor: Angco, Agnes M.

Question:

During a test call placed at the ABCD ACP Detection Division (ACPDD) office, the receiving phone
reflected an ABCD telephone number (2–8243285) as the calling number used, as if the call was
originating from a local telephone in Metro Manila. Upon verification with the ABCD’s Integrated
Customer Management (billing) System, the ACPDD learned that the subscriber of the reflected
telephone number is Juana A. dela Cruz. It further learned that several lines are installed at this
address with Juana and Jose A. dela Cruz, among others, as subscribers. To validate its findings,
the ACPDD conducted various test calls and they all revealed the same results. The caller-id
reflected telephone numbers that are in various names with a common address. It turned out that
the actual occupant of these premises is also dela Cruz.

It was known that Juana and Jose are engaged in a form of network fraud known as International
Simple Resale (ISR) which amounts to theft under the Revised Penal Code. ISR is a method of
routing and completing international long distance calls using lines, cables, antennae and/or wave
frequencies which are connected directly to the domestic exchange facilities of the country where
the call is destined (terminating country); and, in the process, bypassing the IGF at the terminating
country.

Is a telecommunication or telephone services be considered as personal property and

susceptible of appropriation, and thus subject to theft?

SUGGESTED ANSWER:

Yes. Telephone services are personal properties contemplated under the crime of theft.

In a case decided by the Supreme Court, it ruled that even prior to the passage of the Revised
Penal Code, it is well-settled that “any personal property, tangible or intangible, corporeal or
incorporeal, capable of appropriation can be the object of theft.” The jurisprudence applied the
prevailing legal meaning of the term “personal property” under the old Civil Code as “anything
susceptible of appropriation and not included in the foregoing chapter (not real property).”

In the instant case, ABCD’s telephone service or its business of providing this was appropriable
personal property and was, in fact, the subject of appropriation in an ISR operation, facilitated
by means of the unlawful use of ABCD’s facilities. It is the use of ABCD’s facilities without its
consent that constitutes the crime of theft.
 Alfredo Yasay Del Rosario vs. Sps. Jose and Concordia Manuel
G.R. No. 153652, January 16, 2004;

DOCTRINE OF GOOD FAITH:

M, an avid fan of BTS met another avid fan K at a concert held in Manila. The two became
friends thereafter and had been updating each other through facebook. One day, K opened up to
M that she was already homeless because she failed to pay the 3 months rent to buy the ticket
for the BTS concert she attended and had nowhere to go. M being compassionate, allowed K to
temporarily stay at her parent's ancestral house. Three (3) days after, M decided to allow K to
build a temporary shelter near their ancestral house but should vacate the lot upon demand and
provided that the house would only be made of light materials just for K to have her own privacy
and to be able to save so she can buy her own house and lot with which K agreed. However, K
built a house made of concrete without M's consent.

Exactly eight months after K's house was constructed, M asked K to vacate the lot as her
parent's will be visiting their ancestral house. Despite repeated demands, K continues to occupy
the lot.

Is K considered a builder in good faith?

SUGGESTED ANSWER:

No. K is not a builder in good faith.

Article 448 of the Civil Code, refers to one who, not being the owner of the land, builds on
that land believing himself to be its owner, builds on that land, believing himself/herself to be its
owner and unaware of the defect in his/her title or mode of acquisition. The essence of good faith
lies in an honest belief in the validity of one’s right, ignorance of a superior claim, and absence of
intention to overreach another.

Here, K's possession of the land was by mere tolerance of M. Furthermore, one whose
stay is merely tolerated becomes a deforciant occupant the moment she is required to leave. K is
bound by her implied promise, in the absence of a contract, that she will vacate upon demand. In
addition, K occupies the land by mere tolerance, fully aware that her occupation of the land may
be terminated by M any time.

Clearly, K is not a builder in good faith.

 National Housing Authority v. Grace Baptist Church
G.R. No. 156437, March 1, 2004
Contributor: Bontes, Jhoronnie Gayl C

Question:

On 1986, B wrote a letter to S and express his interest to buy Lot 1. A month after, S granted B’s
intention of purchase with an amount of P430,500. On 1991, B tendered check to S with the
amount of P55,350 as full payment of the property in which S rejected because the amount paid
is insufficient. Upon repeated attempts of B to pay S, which the latter rejected, B files a specific
performance and damages against S.

The Regional Trial Court ruled in favor of S that there was no perfected contract of sale between
the parties. However, in the Court of Appeals, the decision was reversed. S was compelled to sell
to B Lot 1 on the ground that such agreement has not been revoked and still in effect. S even
allowed B to occupy the lot and introduced improvements therein. CA ruled, that in the interest of
equity, B shall be allowed to purchase the lot of S.

Aggrieved, S filed a Motion for Reconsideration which was denied. Hence, S filed a petition for
review under Rule 45 of the Rules of Court. S contends that he cannot be compelled to sell the
subject lot to B in the absence of a perfected contract of sale otherwise, it is a violation of its
freedom to contract. S further contends that equity should be applied only in the absence of any
law governing the parties. However, in this case, the law on sales and the law on contracts is
applicable.

If you were the judge, how will you rule the case?

Suggested Answer:

If I were the judge, I will rule in favor of S.

Jurisprudence dictates that a qualified acceptance constitutes a counter-offer as expressly stated

by Art. 1319 of the Civil Code. When there is absolutely no acceptance of an offer or if the offer
is expressly rejected, there is no meeting of the minds and thus no perfected contract.

In the case at bar, the grant of S to the interest of B to purchase his lot was similarly not accepted
by S for it rejected the check payment of B. The alleged contract of this case is accurately
denominated and inexistent. Being no concurrence and acceptance, it did not pass the stage of
generation to the point of perfection. Equity cannot give validity to a void contract, and this rule
should apply with equal force to inexistent contracts. Further, it is clear that B, despite knowledge
that its intended contract of sale with the S had not been perfected, proceeded to introduce
improvements on the disputed lot. On the other hand, S knowingly granted B temporary use of
the subject lot and did not prevent him from making improvements thereon. Thus, B and S, who
both acted in bad faith, shall be treated as if they were both in good faith.

Thus, petition of S is granted and the ruling of the Court of Appeals is hereby reversed and set
aside. The decision of the Regional Trial Court is reinstated. S cannot be compelled to sell Lot 1
to B.
 Rachel C. Celestial vs. Jesse Cachopero, GR# 142595, Oct. 15, 2003;
Cal, Jezreel Minelle
Question:

XX and XY are in a dispute over a parcel of land which was formerly a part of a creek but has
dried up because of the construction by the National Irrigation Administration. XY earlier filed a
Miscellaneous Sales Application over the property with the Bureau of Lands, saying that he had
been occupying the land and that he already introduced improvements therein. XX claimed that
she has preferential right over the land, basing it on her right of accession having been in adverse
possession and her being the adjacent and riparian owner of the disputed parcel of land. Is XY
correct in asserting a claim over the land?

Suggested Answer:

No. XY cannot assert a claim over the land.

Based on jurisprudence, it was held that a dried-up creek bed is property of public dominion.

In the case at bar, since the land is a property of a public dominion being dried-up and cannot be
subjected to accession. The land is not susceptible to private appropriation and acquisitive
prescription.

Hence, neither XX nor XY can assert ownership over the land.

 General Mariano Alvarez Services Coperative, Inc., v. National Housing Authority, et.
al.,
G.R. No. 175417, February 9, 2015
Contributor: Cornelio, Jennyl T.

Question:

The Director of the Bureau of Public Works (BPW) turned over to the National Housing
Authority (NHA) a completed water works system in General Mariano Alvarez, Cavite. NHA, having
the authority to award water system management and administration, turned over the same water
works system to General Mariano Alvarez Services Cooperative, Inc. (GEMASCO). Later on, there
were conflicts in the operation and management of GEMASCO when two Board of Directors
simultaneously administered its affairs. Due to its instability, NHA temporarily intervened and took
over the water service management. Thereafter, NHA entered into a Deed of Transfer and
Acceptance with GMAWD and transferred to the latter the operations and management of the water
system in General Mariano Alvarez, Cavite from GEMASCO which the latter contested.

Meanwhile, a labor case for illegal dismissal was affirmed by the Supreme Court making
GEMASCO liable to pay separation pay and backwages. Subsequently, pursuant to a Writ of
Execution issued, the Sheriff issued a Notice of Garnishment as well as Notice of Sale/Levy on
Execution of Personal Property. GMAWD filed a petition contending that part of the property levied
were owned by GMAWD pursuant to the Deed of Transfer and Acceptance with the NHA.

1. Is the Deed of Transfer and Acceptance valid?

2. Can the property transferred to GMAWD from NHA be subjected to levy on execution or
auction sale.

Suggested Answer:

1. Yes, the Deed of Transfer and Acceptance was valid.

Under the law and existing jurisprudence, administrative decisions are entitled to great
weight and respect and will not be interfered by the courts. Moreover, the interest of the public at
large and the issue of basic needs is always the prime consideration.
 In this particular case, the construction of the water system in said area was necessitated by
the need to alleviate the recurrence of problems during flood disaster, wherein water availability and
its distribution in relocation and resettlement areas were lacking.

In addition, NHA has the authority and the administrative discretion to award water system
management and administration. Likewise, it has also the power to revoke such award and look for
another qualified entity to operate the system. Since GEMASCO’s operations and management
suffered conflicts and upon evaluation, was proven unsatisfactory, NHA has the authority to
intervene and award the water system management to a more qualified entity. Therefore, there was
a valid Deed of Transfer and Acceptance.

2. No, the property cannot be subjected to levy on execution or auction sale.

Jurisprudence provides that, 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. Otherwise, essential public services would stop if properties of public dominion would be
subject to encumbrances, foreclosures and auction sale.

Here, the water works in General Mariano Alvarez, Cavite including the three (3) water tanks
subjected to Writ of Execution is devoted to public use and thus, property of public dominion, which
GMAWD has the right to operate, maintain and manage. Hence, the property transferred GMAWD
cannot be subjected to levy on execution or auction sale for being property of public dominion.
 Sps. Beder Morandarte & Marina Febrera. vs. Court of Appeals, Republic of the
Philippines, and Sps. Lacaya
G.R. No. 123586, August 12, 2004
Contributor: De Pedro, Rosemarie B.

Doctrine:

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 being for public use, and are intended for some
public service or for the development of the national wealth. (339a)

Question:

The Bureau of lands approved the free patent application of Spouses M. After ten (10) years from
the approval, the Republic filed a complaint for Annulment of Title & Revision against Spouses M.
The Republic alleged that BOL found that the subject land includes a portion of the Miputak River
which cannot be validly awarded as it is outside the commerce of man and beyond the authority
of the BOL to dispose of. On the other hand, Spouses M contended that the Miputak River
changed its course due to the closure of the river bed through the construction of dikes for the
fishponds of the Spouses. L who are the holders of fishpond lease agreement by the Bureau of
Fisheries covering a part or portion of the land included in the title issued to Spouses M. In line
with this, Spouses M claim that only a portion of the property sought to be a public domain be
nullified and not the entire title. Is the claim of Spouses M tenable?

Suggested Answer:

Yes, the claim of Spouses M is tenable.

Article 420 of the New Civil Code provides that a river is one of the properties of public
dominion. It is well recognized that property of the public domain is incapable of registration & its
inclusion in a title nullifies that title unless a public land is shown to have been reclassified as
alienable or actually alienated by the State to a private person.

In the present case, a portion of land belonging to the public domain was merely
erroneously included, and absence of clear and convincing evidence of fraud on the part of
Spouses M will not invalidate the entire title. A party who claims for fraud and misrepresentation
bears the burden of proof. Fraud and misrepresentation are never presumed but must be proved
by clear and convincing evidence. Mere preponderance of evidence is not sufficient. Being a
public domain, even Spouses M have been occupying the property for more or less ten (10) years,
the river and their natural beds cannot be acquired by prescription. Therefore, only the portion
traversed by the Miputak river should be reconvened back to the state and that the entire title
should be nullified.
 Julita v. Imuan, et. Al. v. Juanito Cereno, et al.
G. R. No. 167995, September 11, 2009
Contributor: Dimapinto, Samson Nihar M.
Doctrine: Prescription; Laches

Question:

X contracted two marriages. A, X’s grandchild from his first marriage filed a complaint for
annulment of document, reconveyance and damages against Spouses H and W alleging that: (1)
the estate of their grandfather has not yet been settled or partitioned among his heirs; (2) it was
only through their tolerance that Y, X’s second wife constructed their house on the disputed
property; and (3) the sale of the disputed property made by Y to spouses H and W and the
issuance of tax declarations in the latter's names are null and void.

In their Answer, respondent-spouses H and W claimed that at the time X married Y in 1919, the
properties he had were his exclusive share in the partition. They alleged that of the two parcels
of land X had at that time, he donated the subject property to Y in a donation propter nuptias when
they married but the deed of donation was lost during the Japanese occupation and such loss
was evidenced by the Joint Affidavit executed by X’s son by first marriage and former chief of
police of Pangasinan attesting to such donation. Furthermore, Y could validly convey the property
to the Spouses H and W at the time of the sale because she was the owner and that they have
been in public and uninterrupted possession of the disputed lot since its acquisition and have
been paying the realty taxes due thereon. As affirmative defense, respondent-spouses contended
that petitioners' rights over the property were already barred by the statute of limitations. Did the
respondent acquire the disputed property by acquisitive prescription?

Suggested Answer:

Yes. The respondents have acquired the disputed property by acquisitive prescription.

Article 1106 of the NCC provides that by prescription, one acquires ownership and other real
rights over immovable property and is concerned with a lapse of time laid down by law where
possession should be in the concept of an owner, public, peaceful, uninterrupted, and adverse.
Possession is open when it is patent, visible, apparent, and notorious. It is continuous when
uninterrupted, unbroken and not intermittent or occasional; exclusive when the adverse possessor
can show exclusive dominion over the land and an appropriation of it to his own use and benefit;
and notorious when it is so conspicuous that it is generally known and talked of by the public or
the people in the neighborhood. The party who asserts ownership by adverse possession must
prove the presence of the essential elements of acquisitive prescription. Under Article 1117 of the
NCC, Acquisitive prescription of real rights may be ordinary or extraordinary. Article 1134 provides
that ordinary acquisitive prescription requires possession in good faith and a just title in 10 years
while Article 1137 provides that extraordinary acquisitive prescription involves uninterrupted
adverse possession for 30 years without the need for good title and good faith.

In the case at bar, respondents immediately took possession of the property after buying it and
diligently paid its realty tax. Even if petitioner saw respondent-spouses built a house thereon and
planted fruit-bearing trees, he did not raise objection on the respondent’s possession. A’s inaction
further made him guilty of latches since he live merely 100 meters away from the property to know
of the respondent’s possession of said land. Laches is defined as the failure to assert a right for
an unreasonable and unexplained length of time, warranting a presumption that the party entitled
to assert it has either abandoned or declined to assert it. This equitable defense is based upon
grounds of public policy, which requires the discouragement of stale claims for the peace of
society. A only filed an action for reconveyance 29 years after the respondent’s peaceful
possession over the property, the 10-year prescription period for ordinary acquisitive prescription
has already lapsed.

Therefore, the respondents are the rightful owner of the land in dispute.
 Heirs of Susana de Guzman, Represented by Cirilo Tuazon vs. Hon. Court of Appeals
G.R. No. 125758 , January 20, 2004
Contributor: Gamayon, Jeanne Aurice C.

QUESTION:

Nazario de Guzman was the owner in fee simple of those parcels of land situated at Barrio Dilang,
Cainta, Rizal, embraced in and covered by then Original Certificate of Title No. 4331 issued by
the Register of Deeds of Rizal.After his death and upon the approval of the court the said parcels
of land was sold by his surviving spouse, Maria Gonzaga to Alejandro Santos wherein Original
Certificate of Title No. 4331 was cancelled and in lieu thereof , Transfer Certificate of Title No.
21839 was issued by the Register of Deeds of Rizal.

Eventually, Alejandro Santos sold the lot to Jacinto Dela Cruz and Andrea de Leon with TCT
43164 , then the latter sold it to Gabriel Dela Cruz with TCT 47790 whom sold it to Isidro Victorio.
After which Isidro Victorio caused the parcels of land now covered by the Transfer Certificate of
Title No. 44851 to be consolidated and subdivided into 4 lots and the corresponding titles for each
resulting subdivision lots were issued as per Transfer Certificates of Title Nos. 304776 , 304777,
304778 and 304779 and in turn sold to private respondents.
However on November 5, 1993, the petitioners filed a petition before the Regional Trial Court of
Antipolo Rizal, Branch 71 , claiming that owners duplicate copy of the Original Certificate of Title
NO. 4331 was lost when in fact it was already cancelled upon the sale of the land to Alejandro
Santos. The court’s order of issuing a new owners duplicate of Original Certificate of Title No.
4331 cast a cloud on the titles of the private respondents, causing the latter to file an action for
Quieting of Title Nullification and Cancellation of Title in Branch 74 of the same court.

Issue:
Did the court err in holding that the petition filed by the private respondents is for quieting of title
and cancellation of original certificate of title No. 4331?

Held:

No.

A cursory examination of the foregoing averments readily shows that the private respondents’
petition is indeed , as captioned , one for quieting of title and nullification and cancellation of
title. Thus, the private respondents assert therein that the issuance to petitioners of a new
owner’s duplicate copy of OCT No. 4331 , which was procured by fraudulent representation ,
casts a cloud on the titles of the private respondents and , therefore , should be annulled and
cancelled.
 Agnes Gapacan, vs. Maria Gapacan Omipet,
G.R. No. 148943, August 15, 2002;
Ibarra, Ceasarie Kae

Question:

B is the primitive possessor of an unregistered land in Mt. Province, divided into 3 parcels of rice
land and another planted to camote and declared by him for taxation purposes. He had two
children X and Y. Y left for a long while to try his luck in the minefields of Benguet. X remained,
took care of their father and eventually took over the cultivation of the land.

Y returned to and executed an Affidavit of Transfer of Real Property showing that the property
had been transferred to him by his sister X making him in effect the legal owner of the property in
question. Since then, Y’s family had been occupying and cultivating the property.

Later, X hired laborers to clear and cultivate portions of the said property. However, Y’s family
prohibited them and ordered them to vacate the land and restore possession to them.

X then filed an action to quiet title in the Regional Trial Court and prayed that she be declared the
lawful owner. RTC adjudged that Y have right of possession over the land. On appeal, CA
declared that the land is a common property of both X and Y and ordered its partition.Y appealed
and alleged that CA cannot declare that the land is a common property since it deviates from the
cause of action of the case in the trial court. Is Y correct?

Suggested answer:

No, Y is not correct.

Article 476 of the Civil Code provides that an action to quiet title may be brought when there exists
a cloud on the title to real property or any interest therein. Jurisprudence further provides that a
property owner whose property rights were being disturbed may ask a competent court for a
proper determination of the respective rights of the party-claimants, not only to place things in
their proper place, that is, to require the one who has no right to refrain from acts injurious to the
peaceful enjoyment of the property not only of the rightful owner but also for the benefit of both
with the view of dissipating any cloud of doubt over the property.

In this case, the CA is within its jurisdiction to adjudicate on the respective rights of the parties
which is to pass upon the ownership of the subject property, hence declaring the same as a
common property of the parties. Further, X instituted such action for the purpose of asking the
court to pass judgment upon the issue of ownership of the disputed property.

Thus, Y is not correct in saying that the CA cannot declare that the land is a common property
since it deviates from the cause of action of the case in the trial court.
 Lucio Robles, Emeteria Robles, Aludia Robles and Emilio Robles vs Spouses Virgilio
Santos

Contributor: Jucutan, Maria Carla

Doctrine:

Article 476 of the Civil Code provides that whenever there is cloud on the 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 title

Question:

Leon Robles owned the land situated in Morong, Rizal with an area of 9,985 square meters. He
occupied openly and adversely and also declared in his name for taxation purposes as early 1916
and paid taxes thereon. When Leon Robles died, his son Silvino Robles inherited the land.

Upon the death of Silvino Robles in 1942, his widow Maria de la Cruz and his children inherited
the property. They took adverse possession of said property and paid taxes. The task of cultivating
the land was assigned to plaintiff Lucio Robles who planted trees and other crops. He also build
a nipa hut on the land. The plaintiffs entrusted the payment of the land taxes to their co-heir and
half-brother, Hilario Robles. Whether petitioners have the appropriate title essential to an action
for quieting of title and whether the title claimed by respondents is valid?

Suggested answer:

Yes, petitioners have the appropriate title essential to an action for quieting of title. Petitioners
have a valid title by virtue of their continued and open occupation and possession as owner of the
property.

In this case, the real estate mortgage allegedly executed by Hilario Robles is not valid because
his signature in the mortgage deed was forged. The Robles spouses then mortgaged it to the
Rural Bank of Cardona, Inc. Not as co-owners but as absolute owners. However, in a real estate
mortgage contract, it is essential that the mortgagor be the absolute owner of the property to be
mortgaged; otherwise, the mortgage is void. Hilario Robles was not the absolute owner of the
entire subject property and the Rural Bank of Cardona failed to observe due diligence and was a
mortgagee in bad faith.

Therefore, petitioners have the appropriate title essential to an action for quieting of title.
 Rosalina Clado-Reyes, et al. v. Sps Julius and Lily Limpe
G.R. No. 163876, July 9, 2008
Contributor: Jan Julia M. Jumagdao

Question:

Basilio and Crispin filed an action to quiet title, reconveyance and damages and alleged that they
have been occupying a disputed lot through a predecessor-in-interest, Sisa. They claimed that
during her lifetime, Sisa had accepted a verbal promise of the former lot owner, Maria Clara, to
give the disputed lot to him in exchange for the surrender of his tenancy rights as a tiller thereof.
They presented two documents, a certification and pagpapatunay. Basilio and Crispin later on
received a letter from Spouses Dash and Lily asserting ownership over the disputed lot. Spouses
Dash and Lily contended that they are the legal owners of the lot by virtue of a Deed of Exchange
of Real Estate. To further assert ownership, Spouses Dash and Lily presented certificate of title,
tax declaration, and realty tax receipts. Will the action to quiet title prosper?

Suggested Answer:

No, the action to quiet title cannot prosper.

Under Articles 476 and 477 of the New Civil Code, there are two indispensable requisites
in order that an action to quiet title could prosper: (1) that the plaintiff or complainant has a legal
or an equitable title to or interest in the real property subject of the action; and (2) that 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.

He who alleges has the burden of proving the allegation with the requisite quantum of
evidence. The certificate of title, tax declarations and realty tax receipts showed that respondents
consistently paid the corresponding real property taxes. These pieces of evidence prevail over
allegations of an undocumented promise by the former lot owner, which in itself, is ineffective or
unenforceable under the law.

Furthermore, jurisprudence provide that such realty tax payments constitute proof that the
holder has a claim of title over the property.
Heirs of Enrique Diaz, represented by Aurora T. Diaz v. Elinor A. Virata, in her capacity as
the Administratrix of the Estate of Antenor Virata
G.R. No. 162037, August 7, 2006
Contributor: Ladub, Franchesca Bea B.

Doctrine: Article 476 of the Civil Code provides that an action for quieting of title is a remedy
which may be availed of only when by reason of any instrument, record, claim, encumbrance or
proceeding, which appears valid but is, in fact, invalid, ineffective, voidable or unenforceable, a
cloud is thereby cast on the complainant’s title to real property or any interest therein.

Bar Question:
E, in her capacity as Administratrix of the Estate of A, filed before the RTC a Complaint
with Application for Temporary Restraining Order and/or Preliminary Injunction against D, praying
for the declaration of the validity of certain Transfer Certificate of Titles (TCTs) all issued in the
name of A and registered with the Registry of Deeds. E averred that A had purchased the parcels
of land covered by the foregoing TCTs from M. Meanwhile, D contended that his ancestors had
been in actual and continuous possession of the subject parcels of land since time immemorial.
Accordingly, the validity of A’s TCTs were upheld by the RTC and affirmed by the Court of Appeals
and were not found to be tainted with any defect. The RTC further declared that A’s titles were
the only official titles covering the subject properties and ruled that D had illegal possession of the
same.

Was E able to satisfy the requirements for the filing of an action for the quieting of title?

Suggested Answer:
Yes. E, in this case, was able to satisfy the requisites for the filing of an action to quiet
title.

Article 476 of the Civil Code provides that 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. Moreover, an action may also be brought to prevent a cloud from being
cast upon title to real property or any interest therein.

In the case herewith, the validity of A’s TCTs must be upheld as these were not found to
be tainted with any defect. By contrast, the titles in D’s possession were deemed invalid or
inoperative. Well-settled is the rule that where the findings of fact of the trial court are affirmed by
the Court of Appeals, the same are final and conclusive upon the Supreme Court. Thus, E, in this
case, had properly filed an action to quiet title.
 Rosalina Clado-Reyes vs Sps. Julius and Lily Limpe
G.R. No. 163876 July 9,2008
Contributor: Miranda, Fevi May M.

Question:

On February 1, 1995, X and Z filed an action to quiet title, reconveyance and damages against J
and S and alleged that they have been occupying the disputed lot since 1945 through M, their
predecessor-in-interest. They claimed that during his lifetime, M had accepted a verbal promise
of J, the former lot owner, to give the disputed lot to him in exchange for the surrender of his
tenancy rights as a tiller thereof. To prove that M was a former tenant of J, that during his lifetime
he had worked on the lot and that he owned and possessed the same, X and Z presented two
documents, namely: (a) Certification and (b) "Pagpapatunay" allegedly executed by S, the eldest
son of J, attesting to such facts. X and Z also alleged that whenever J and S would visit the lot, Y
would promise to deliver the certificate of title to them. However, sometime in October 1994, X
and Z received a letter from J and S asserting ownership over the disputed lot. In their answer, J
and S contended that they are the legal owners of the lot by virtue of a Deed of Exchange of Real
Estate and Deed of Absolute Sale executed on July 5, 1974 and February 28, 1974, respectively,
between them and ABC Industries, Incorporated. Does X and Z have a cause of action to quiet
title, reconveyance and damages against J and S?

Suggested Answer:

NO. X and Z did not establish legal or equitable title to the subject lot and the documentary
evidence presented did not confirm their title to the lot. Under Articles 476 and 477 of the New
Civil Code, there are two indispensable requisites in order that an action to quiet title could
prosper: (1) that the plaintiff or complainant has a legal or an equitable title to or interest in the
real property subject of the action; and (2) that 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.
 Heirs of Enrique Diaz v. Virata,
G.R. No. 162037, August 7, 2006;
Juanillo, Althea Jane

.DOCTRINE:

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.

QUESTION:

Antenor purchased from Miguela, in good faith and for consideration, two (2) parcels of land
covered by TCTs and registered with the Registry of Deeds. By virtue of the sale, the titles were
canceled and new TCTs were then issued in the name of Antenor. Thereafter, the two lots were
subdivided by Antenor into several lots, and titles were issued in her favor.

Enrique filed a claim with the DENR alleging that he and his predecessors-in-interest had been in
continuous possession of the same lots owned by Antenor. Elena, the administratrix of the estate
of Antenor, insisted that the claim of Y over the subject properties created a cloud which may be
prejudicial to the titles issued in the name of Antenor.

Is the action to quiet title proper?

SUGGESTED ANSWER:

Yes, the action to quiet title is proper.

Article 476 provides that 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. Further, Article 477 of the same Code mandates that in an action to quiet title,
the party bringing the action must have a legal or, at least, an equitable title to the real property
subject of the action and that the alleged cloud on his title must be shown to be in fact invalid.
Verily, for an action to quiet title to prosper, two indispensable requisites must concur, namely:
(1) the plaintiff or complainant has a legal or an 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. Well-established is the principle that the person holding a
prior certificate is entitled to the land as against a person who relies on a subsequent certificate.
In the present case, Elena was able to satisfy the requisites of the law for the filing of an action to
quiet title. Elena’s presentation of facts were given credence by the trial court and affirmed by
appellate court. Nothing is more settled than the rule that where the findings of fact of the trial
court are affirmed by the Court of Appeals, the same are final and conclusive upon this Court.
The validity of Antenor's titles which was issued in 1959 was not found to be tainted with any
defect. Even if Enrique possessed certificates of title over certain portions of the subject
properties, these were issued only in 1973 and 1991.

Thus, the action to quiet title is proper.

 Ayala Corporation v. Rosa Diana Realty and Development Corp.,
G.R. No. 134284, Decebmer 1, 2000;
Pamine, Sunshine

DOCTRINE:

Obligations arising from contracts have the force of law between the contracting parties and
should be complied in good faith.

QUESTION:

A Corporation was the registered owner of a parcel of land in Makati City covered by TCT No.
233435. This land was sold to Spouses X and Spouses Y which contained stipulation that the
gross floor area constructed of the building should not exceed more than 5 times the lot area and
total heigh shall not exceed 42 meters. The restriction shall be terminated at end of year 2025.

Both spouses failed to comply with said restrictions and sold the land to Z Corporation with the
same conditions and approval from A Corporation. In order to release the title of such land, Z
Corporation issued an undertaking to follow the restrictions which were considered as
encumbrances in the title. The approved building plan submitted by Z Corporation to A
Corporation was different to the plan submitted to the administrator in Makati City. This prompted
A Corporation to file recission of the sale. Will the case prosper based on breach of deed of
restriction?

SUGGESTED ANSWER

Yes, the case will prosper.

Under the law, contractual obligations between the parties have force of law between them and
absent any allegation that the same are contrary to law, morals, good customs, public order and
public policy, they must be complied in good faith.

In the instant case, Z Corporation has violated the contract by submitting a different business plan
to A Corporation and to the administrator in Makati City. The Deed of Restriction has the obligation
to be enforced to A Corporation.
 Department of Eductation v. Delfina C. Casibang, et. al.,
G.R. No. 192268, January 27, 2016VSD
Paracuelles, Reden Jalyn

Doctrine:
There is no absolute rule as to what constitutes laches or staleness of demand; each case
is to be determined according to its particular circumstances. The question of laches is addressed
to the sound discretion of the court, and since laches is an equitable doctrine, its application is
controlled by equitable considerations. It cannot work to defeat justice or to perpetrate fraud and
injustice.

Question:
In 1965, Upon the request of then Mayor X, A allowed the construction and operation of a
school on the western portion of A’s property. The school is operating under the control and
supervision of DEPED. In 2000, The heirs of A entered and occupied a portion of the property.
The school officials demanded the respondents to vacate the property. However, the respondents
refused to vacate the property, and asserted A’s ownership of the lot.

Whether or not the heirs of A are barred torecover possession because of prescription or
laches and whether or not DEPED is a builder in good faith?

Suggested Answer:
No, as registered owners of the lots in question, the heirs of A 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 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.
Furthermore, those who occupy the land of another at the latter's tolerance or permission, without
any contract between them, are necessarily bound by an implied promise that the occupants will
vacate the property upon demand.

Yes, DEPED is a builder in good faith. To be deemed a builder in good faith, it is essential
that a person asserts title to the land on which he builds, i.e., that he be a possessor in the concept
of owner, and that he be unaware that there exists in his title or mode of acquisition any flaw which
invalidates it.

However, there are cases where Article 448 of the Civil Code was applied beyond the
recognized and limited definition of good faith, e.g., cases wherein the builder has constructed
improvements on the land of another with the consent of the owner. The Court ruled therein that
the structures were built in good faith in those cases that the owners knew and approved of the
construction of improvements on the property.
 Heirs of Victorino Sarili v. Pedro F. Lagrosa,
G.R. No.193517, January 15, 2014
Pardenilla, Jennifer

DOCTRINE:

Every person dealing with registered land may safely rely on the correctness of the certificate
issued therefore and the law will in no way oblige him to go beyond the certificate to determine
the condition of the property. However, a higher degree of prudence is required from the one
who buys from a person who is not the registered owner, although the land object of the
transaction is registered. In such a case, the buyer is expected to examine not only the
certificate of title but all factual circumstances necessary for him to determine if there are any
flaws in the title of the transferor. The buyer also has the duty to ascertain the identity of the
person with whom he is dealing with and the latter’s legal authority to convey the property.

QUESTION:

Respondent is the owner of a certain parcel of land which he has been religiously paying the real
estate taxes for since its acquisition. He discovered that a new certificate of title to the subject
property was issued by the RD in the name of Victorino married to Isabel Amparoby virtue of a
falsified Deed of Absolute Sale dated February 16, 1978 (February 16, 1978 deed of sale)
purportedly executed by him and his wife, Amelia U. Lagrosa.

Sps. Sarili maintained that they are innocent purchasers for value, having purchased the subject
property from Ramon B. Rodriguez, who possessed and presented a Special Power of Attorney
to sell/dispose of the same, and, in such capacity, executed a Deed of Absolute Sale dated
November 20, 1992 conveying the said property in their favor.

Was there a valid conveyance of the property?

SUGGESTED ANSWER:

There was no valid conveyance of the subject property to Sps. Sarili.

The strength of the buyer’s inquiry on the seller’s capacity or legal authority to sell depends on
the proof of capacity of the seller. If the proof of capacity consists of a special power of attorney
duly notarized, mere inspection of the face of such public document already constitutes sufficient
inquiry. If no such special power of attorney is provided or there is one but there appears to be
flaws in its notarial acknowledgment, mere inspection of the document will not do; the buyer must
show that his investigation went beyond the document and into the circumstances of its execution.

Settled is the rule that a defective notarization will strip the document of its public character and
reduce it to a private instrument, and the evidentiary standard of its validity shall be based on
preponderance of evidence.
Since Sps. Sarili’s claim over the subject property is based on forged documents, no valid title
had been transferred to them.
 HEIRS OF CIPRIANO TRAZONA v. HEIRS OF DIONISIO CANADA
G.R. No. 175874, December 11, 2013
Contributed by: Peñalosa, Belle Marie G.

Doctrine: It is true that notarized documents are accorded evidentiary weight as regards their
due execution. Nevertheless, while notarized documents enjoy the presumption of regularity,
this presumption is disputable. They can be contradicted by evidence that is clear, convincing,
and more than merely preponderant.

Facts:

Heirs of Cipriano Trazona (Cipriano), who owned an untitled parcel of land referred to as Lot
No. 5053-H. The property, is covered by Tax Declaration No. 07764. The land was purchased
from the government in 1940. Since then, Cipriano had taken possession of the land, cultivated
it and diligently paid taxes thereon.

The Heirs of Trazona, went to the Office of the Municipal Assessor to secure a copy of Tax
Declaration No. 07764, as they intended to sell Lot No. 5053-H. To their surprise, they were
informed that Tax Declaration No. 07764 had been cancelled and, in lieu thereof, Tax
Declaration No. 23959 was issued on 24 June 1996 in the name of Dionisio. Apparently, Diosno
had caused the issuance of Tax Declaration No. 23959 by submitting a Deed of Absolute Sale
dated 27 June 1956 supposedly executed by Cipriano in favor of Dionisio. That sale involved a
portion of Lot No. 5053-H. Petitioners summoned respondents before the Lupon
Tagapamayapa, but the conciliation was not successful.

Dionisio offered to buy the encroached portion, but Cipriano refused the offer. In 1956, the latter
gave Dionisio permission to temporarily build a house on said portion, where it still stands. No
action for ejectment was filed against Dionisio during the lifetime of Cipriano, who eventually
died on 18 May 1982. The latter’s son Hermogenes, one of the Heirs of Cipriano, herein who
had cultivated the lot since 1972, took over. On 24 March 1992, Dionisio died.

On 28 July 1997, the Heirs of Cipriano, filed a Complaint against respondents for quieting of
title, annulment of deed of sale, cancellation of Tax Declaration No. 23959, recovery of
possession and ownership, damages, and payment of attorney’s fees. Did the Heirs of Capriano
Trazona not able to overturn the presumption of regularity of the assailed deed?

Suggested Answer:

No, Cipriano had cultivated the property and paid taxes thereon since the time he acquired it
from the government, and even after its purported sale to Dionisio, until his death. The Heirs of
Capriano continued paying the taxes thereon even after Cipriano had died. The Heirs of Disno
only started paying taxes on the property only after Tax Declaration No. 23959 was issued in
Dionisio’s name in 1997. It would be absurd for petitioners to pay taxes on a property they do
not own.

In this case, evidence adduced fully supports the position of the Heirs of Capriano that the
assailed deed of sale is forged and that they are the owners of the property. Having been forced
to litigate in order to protect their interest therein, the award of attorney's fees and litigation
expenses to them is in order.
 Sps. Marcos Esmaquel and Victoria Soldevilla vs. Maria Coprada

GR No. 152423, December 15, 2010

Contributor; Pepito, Victoria Ashley P.

Doctrine: 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.

Bar Question :

Spouses A and B claimed that there were the registered owners of a certain parcel of land located
in Liwayway Street. C, a close friend of the spouses was able to persuade the later to allow her
and her family to use and occupy the land for their residence, under the condition that they will
vacate the premises if ever the spouses will decide to use such property. Out of pity, the spouses
never made an attempt to drive them away considering that C has eight children. When the
personal circumstance of C has improved because some of her children are already working and
professional , the spouses demanded that they should now vacate the property. Due to the refusal
of the former, a case for ejectment was filed against her. C contended that she’s a builder in good
faith because she was able to build the structure with the prior permission of the owner. Thus,
she was entitled to be reimbursed the necessary ad useful expenses under Article 546 and 548
of the Civil Code. Without such reimbursement, she has the right of retention over the property
and she cannot be just ejected from the premises.

Is the contention of C meritorious?

Suggested Answer :

No. C’s contention is not meritorious.

Article 446 and 546 of the New Civil Code, which allow full reimbursement of useful
improvements and retention of the premises until reimbursement is made , applies only to a
possessor in good faith. Those possessors who builds on land with the belief that he is the
owner thereof. Those persons whose occupation of a realty is by sheer tolerance of its owners
are not possessors in good faith.

In the instant case, at the time C built the improvements on the premises, she knew that her
possession was by mere permission and tolerance of spouses A and B. C has no right to retain
her possession under Article 448 of the Civil Code.

Hence, she cannot be said to be a person who builds on land with the belief that she is the
owner thereof.
 COMMUNITIES CAGAYAN, INC., Petitioner,
vs.
SPOUSES ARSENIO (Deceased) and ANGELES NANOL AND ANYBODY CLAIMING
RIGHTS UNDER THEM, Respondents.
G.R. No. 176791 November 14, 2012
Contributor: Plantar, Krizziane Katrina N.

Question:

Spouses Laki and Bayi Dela Cruz entered into a Contract to sell with ABC, Inc, whereby the latter
agreed to sell to the Spouses Dela Cruz a house and lots 1 and 2 for a price of P500,000.00. The
spouses did not avail of the ABC’s inhouse financing due to its high interest rates and instead
obtained a loan from XYZ Bank using the property as a collateral. To facilitate the loan, a
simulated sale over the property was executed by the ABC in favor of the spouses. Accordingly,
titles were transferred in the names of respondent-spouses under Transfer Certificates of Title
(TCT) Nos. 105202 and 105203, and submitted to XYZ Bank for loan processing. Unfortunately,
the bank collapsed and closed before it could release the loan.

Few weeks after, the spouses entered into another contract to sell with ABC, Inc. over the same
property for the same price and his time, availed of the ABC’s in house financing.

The spouses demolished the original house and constructed a three-story house allegedly valued
at P3.5 million, more or less.

Laki Dela Cruz died leaving his wife to pay for the monthly amortizations which the latter failed to
pay.

ABC filed a complaint for cancellation of title, recovery of possession, reconveyance and
damages against the spouses alleging that the transfer of titles in the names of the spouses was
made only in compliance with the requirements of XYZ Bank.

Whether or not the spouses are considered builders in good faith entitled to indemnification for
necessary and useful expenses and/or to buy the land under the provisions of the New Civil Code.

Suggested Answer:

Yes, Spouses Dela Cruz are considered builders in good faith entitled to indemnification for
necessary and useful expenses and/or to buy the land under the provisions of the New Civil Code.

Article 448 of the Civil Code provides that 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. As
a general rule, Article 448 on builders in good faith does not apply where there is a contractual
relation between the parties 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, or that, at least,
he has a claim of title thereto.

In the case at hand, The subject property is covered by a Contract to Sell hence ownership still
remains with petitioner being the seller. First, good faith is presumed on the part of the spouses.
Second, ABC failed to rebut this presumption. Third, no evidence was presented to show that
ABC opposed or objected to the improvements introduced by the spouses. Consequently, we can
validly presume that ABC consented to the improvements being constructed. This presumption is
bolstered by the fact that as the subdivision developer, petitioner must have given the spouses
permits to commence and undertake the construction. Under Article 453 of the Civil Code, "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.
 AUTOMAT REALTY AND DEVELOPMENT CORPORATION, LITO CECILIA AND LEONOR
LIM, Petitioners, vs. SPOUSES MARCIANO DELA CRUZ, SR. AND OFELIA DELA CRUZ,
Respondents
G. R. No. 192026, October 01, 2014
Contributor: Ranario, Charmaine Hope A.

Doctrine: 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.

Bar Question:

Matmat Realty is the registered owner of two parcels of land in Barangay Malitlit, Sta. Rosa,
Laguna. It acquired one parcel from El Seoul Realty and Development Corporation and the other
from XYZ. The land was not occupied in 1990 when Matmat purchased it. XYZ volunteered her
services to L as caretaker to prevent informal settlers from entering the property. Matmat agreed,
through L as its authorized administrator, on the condition that the caretaker would voluntarily
vacate upon Matmat’s demand.XYZ’s family stayed in the property as rent-paying tenants. They
cultivated and improved the land. They shared the produced palay with Matmat through its
authorized agent C, who remitted the rentals to Lim in Makati and to Matmat’s office in Quezon
City..

Sometime in August 2000, Matmat asked respondent spouses to vacate the premises as it was
preparing the groundwork for developing the property.Respondent spouses refused to vacate
unless they were paid compensation.They claimed “they were agricultural tenants [who] enjoyed
security of tenure under the law.

Matmat had recovered possession of the property before respondent spouses filed their petition
for maintenance of peaceful possession with prayer for preliminary mandatory injunction and/or
temporary restraining order against Matmat before the PARAD for Laguna.PARAD dismissed the
complaint. It declared, among other things, that “no agricultural tenancy can be established
between [the parties] under the attending factual circumstances.”

Whether or not respondent spouses may be considered as builders, planters, or sowers in good
faith.

Suggested Answer:

Yes, respondent spouses may be considered as builders, planters, or sowers in good faith.

Under Article 448 of the Civil Code, “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”. In cases of similar facts, the Court has ruled that the 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. However, in some special cases, the Court has used
Article 448 by recognizing good faith beyond this limited definition. The provision was 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.

Here, respondent spouses alleged in their petition before the PARAD that they had “introduced
various agricultural improvements purposely to make the said landholdings productive, harvests
of which were remitted and delivered to Matmat through its administrator C, which presumed has
consented to various agricultural improvements made by them. In addition, the Court of Appeals’
recitation of facts also state that respondent spouses “cultivated the area, improved the same and
shared the palay produced therein to the owner, Matmat, through its authorized agent, C.”

Hence, if the facts can show that the proper case involves the Civil Code provisions on builders,
planters, and sowers, respondent spouses may be considered as builders, planters, or sowers in
good faith, provided such is proven before the proper court.
 Rodolfo Rosales represented by his heirs vs. Miguel Castelltort et al
G.R. No. 157044, October 5, 2005
Digested by: Regidor, Maristela A.
Question:

Spouses Alfa discovered that a KPOP Energy establishment was being constructed on their lot,
in the absence of their knowledge and consent, being the registered owner of a parcel of land,
covered by TCT No. 12345678 and designated as LOT No. 1 of the Subdivision Plan
situated in Gangnam City, Province of Cebu. The KPOP Energy as the respondent claimed
that they acted in good faith in constructing the establishment as they relied on the technical
description of the lot under the Land Lease Agreement with NP Corporation of the President Rudy
Arroyo.

During the negotiation and after the survey the geodetic Engineer pointed out that the
respondent Land Lease Agreement is not LOT No. 1 but LOT No. 2 a different and adjacent lot
of the Spouses Alfa. Respondent claimed that they acted in good faith in constructing the
establishment on the Spouses lot as they relied on the technical description given to them as
stipulated in the Land Lease Agreement.

Is respondent KPOP Energy establishment a builder in good faith?

Suggested Answer:

YES, respondent is considered a builder in good faith.

A builder in good faith is one who builds with the belief that the land he is building on
is his, or that by some title one has the right to build thereon, and is ignorant of any defect or
flaw in his title. Good faith is always presumed, and upon him who alleges bad faith on the
part of a possessor rests the burden of proof.

Under Art. 448 of the Civil Code, the landowner can choose between appropriating the
building by paying the proper indemnity or obliging the builder to pay the price of the land,
unless its value is considerably more than that of the structures, in which case the builder in
good faith shall pay reasonable rent. If the parties cannot come to terms over the conditions of
the lease, the court must fix the terms thereof. The choice belongs to the owner of the
land, a rule that accords with the principle of accession, i.e., that the a 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 owner of the
building to remove it from the land. (Rosales v. Castelltort, G.R. No. 157044, October 5, 2005)
NOTE:

Possession acquired in good faith does not lose this character except in the case and from the
moment facts exist which show that the possessor is not unaware that he possesses the thing
improperly or wrongfully. The good faith

ceases or is legally interrupted from the moment defects in the title are made known to the
possessor, by extraneous evidence or by suit for recovery of the property by the true owner.
 Spouses Crispin and Teresa Aquino v. Spouses Eusebio and Josefina Aguilar,
G.R. No. 182754, June 29, 2015
Contributor: Nisnisan, Dawn Gelianne M.

Doctrine: Article 452. Builders in bad faith are entitled to recoup the necessary expenses
incurred for the preservation of the land. However, a builder in bad faith does not have the
right of retention over the premises.

Bar Question:

Spouses A are the owners of a house and lot located at Makati City as evidenced by
Transfer of Certificate. The subject property is being occupied by Mrs.A’s sister Mrs. B, her
husband and their family. Spouses B stayed on the property with the consent and approval
of the Spouses A who were residing in the United States. While Spouses B were in
possession of the property, the house previously constructed therein was demolished, and
a three (3) storey building built in its place. The Spouses B occupied half of the third floor
of the building for the next 20 years without payment of rent. Spouses A sent a letter to
Spouses B informing them that an immediate family needed to use the premises and
demanding the surrender of the property. Spouses B failed to heed this demand, prompting
the petitioners to file an ejectment case. Spouses B claimed that they contributed to the
improvement of the property and the construction of the building, both in terms of money
and management. Spouses A purportedly agreed to let them contribute to the costs of
construction in exchange for the exclusive use of a portion of the building. May Spouses B
(builders in bad faith) recover the necessary expenses incurred?

Suggested Answer:

Yes, Spouses B may recover the necessary expenses incurred for the preservation of the
property but without the right of retention as builders in bad faith.

Under Art. 452 of the Civil Code, a builder in bad faith is entitled to recoup the necessary
expenses incurred for the preservation of the land. However, a builder in bad faith does not
have the right of retention over the premises.

In the case at hand, Spouses A had already warned Spouses B not to build a structure on
the property. It was held that Spouses A, as the owners of the land, have the right to
appropriate what has been built on the property, without any obligation to pay indemnity
therefor; and that Spouses B have no right to a refund of any improvement built therein,
pursuant to Articles 449 and 450 of the Civil Code: Art. 449. He who builds, plants or sows
in bad faith on the land of another, loses what is built, planted or sown without right of
indemnity. However, Spouses B, builder in bad faith may recover the money spent on
maintenance of the property, which Spouses A acknowledged and promised to reimburse
to them.

Hence, Spouses B in this case are similarly entitled to reimbursement. However, being
builders in bad faith, they do not have the right of retention over the premises.
 VSD Realty & Development Corp. v. Uniwide Sales, Inc.
G.R. No. 170677, October 24, 2012;
Contributor: Pizon, Bea Gabrielle A.

Doctrines:
· Civil Code; Article 434: to successfully maintain an action to recover the ownership of a real
property, the person who claims a better right to it must prove two (2) things: first, the identity
of the land claimed, and; second, his title thereto.
· Torrens System; When remand is necessary: In the interest of justice, and to safeguard the
correct titling of properties, a remand is proper to determine which of the parties derived valid
title from the legitimate OCT No. 994 registered on May 3, 1917.

Bar Question:
ABSCBN Corp. alleged that it is the owner of LOT-123 covered by a TCT123, which the
company purchased from Mari Con. On the other hand, Mari Tess claims ownership and has
possession over the said lot. Mari Tess even entered into a contract of lease with GMA, Inc.
Because of the said contract of lease, GMA constructed a building on the said land. ABSCBN
alleged that Mari Tess’s technical description in her title is not the same as the technical
description in ABSCBN’s title. Mari Tess contended that her adoptive mother gave LOT-123 to
her through a will. She added that during her open and public possession of the said property for
over 40 years, nobody came forward to contest her title. It was only in 1994 that ABSCBN
demanded rentals from GMA, asserting ownership over the land.

1. Is ABSCBN entitled to the recovery of possession of the subject property?

2. If so, can the Supreme Court still entertain such newly discovered evidence supposing
that GMA and Mari Tess files for a motion for reconsideration?

Suggested Answers:
1. Yes, ABSCBN is entitled to recovery of possession of subject property.

Art. 434 of the Code provides that to recover the ownership of a real property, the person
who claims a better right to it must prove two (2) things: first, the identity of the land claimed, and;
second, his title thereto.
 In this case, ABSCBN proved the identity of the land it is claiming through the technical
description contained in its title, the derivative title of MariCon; the technical description in the
official records in the Register of Deeds; and the verification survey conducted by the DENR. In
addition, ABSCBN proved its title over the property by presenting in evidence its title, TCT No. T-
285312.

Hence, it is entitled to recover the possession of the property from GMA and Mari Tess.
(VSD Realty v. Uniwide Sa, G.R. No. 170677, October 24, 2012)

2. Yes, the Court can still entertain such newly discovered evidence in the interest of
justice.

In Manotok Realty, Inc. v. CLT Realty Development Corporation, in the interest of justice,
and to safeguard the correct titling of properties, a remand is proper to determine which of the
parties derived valid title from the legitimate OCT No. 994 registered on May 3, 1917. The Court
recognizes the importance of protecting the country’s Torrens system from fake land titles and
deeds.

Considering that there is an issue on the validity of the title of ABSCBN, which title is alleged
to be traceable to OCT No. 994 registered on April 19, 1917, which mother title was held to be
inexistent. Since this Court is not a trier of facts and not capacitated to appreciate evidence of the
first instance, the Court may remand this case to the Court of Appeals for further proceedings, as
it has been similarly tasked in Manotok Realty, Inc. v. CLT Realty Development Corporation.
(RESOLUTION: VSD Realty v. Uniwide Sa, G.R. No. 170677, July 31, 2013)
 Ownership, particularly the Rights to
Accession Discreta, Accession Continua
Natural, and Accession Continual
Industrial and evidence of ownership
pertinent to the subject matter of Land
Titles.
 Republic of the Philippines v. Hon. Normelito J. Ballocanag, et. al.,
GR No. 163794, November 28, 2008;
Reyes, Janssen Reyna G

Doctrine: Nemo cum alterius detrimento locupletari potest. This basic doctrine on unjust
enrichment simply means that a person shall not be allowed to profit or enrich himself inequitably
at another's expense. There is unjust enrichment when a person unjustly retains a benefit to the
loss of another, or when a person retains money or property of another against the fundamental
principles of justice, equity and good conscience.

Bar Question:

Mr. Reyes, sometime in 1970, acquired a land from Ms. Castillo. Right after his purchase, Mr.
Reyes introduced improvements and planted the land with fruit trees and caused the transfer of
the property to his name. Unfortunately, it turned out that the land is part of a timber land so the
land was reverted to the State as part of the public domain through a reversion proceeding.

When Mr. Reyes filed a Motion to Remove Improvements Introduced by Defendant Danilo D.
Reyes on the Property, the Office of the Solicitor General opposed the motion, citing the principle
of accession under Article 440 of the Civil Code arguing that the subject land, being timber land,
is property of public dominion and, therefore, outside the commerce of man and cannot be leased,
donated, sold, or be the object of any contract. This being the case, there are no improvements
to speak of, because the land in question never ceased to be a property of the Republic, even if
Mr. Reyes claimed that he was a purchaser for value and in good faith and was in possession for
more than thirty (30) years. Should the State properly acquire the improvements introduced by
Mr. Reyes?

Suggested Answer:
No, the State cannot acquire the improvements introduced by Mr. Reyes.

Articles 448 and 546 of the Civil Code grant the builder or planter in good faith full
reimbursement of useful improvements and retention of the premises until reimbursement is
made. A builder or planter in good faith is one who builds or plants on land with the belief that he
is the owner thereof, unaware of any flaw in his title to the land at the time he builds or plants on
it.
In this case, Mr. Reyes was a planter in good faith. Reyes was of the belief that he was
the owner of the subject land. He tilled the land, planted fruit trees thereon, and invested money.
To order Reyes to simply surrender all of these fruit-bearing trees in favor of the State because
the decision in the reversion case declaring that the land is part of inalienable forest land and
belongs to the State is already final and immutable would inequitably result in unjust enrichment
of the State at the expense of Reyes, a planter in good faith.

Therefore, the State cannot acquire the improvements Mr. Reyes had painstakingly
planted and invested in.
 MIDWAY MARITIME AND TECHNOLOGICAL FOUNDATION v. MARISSA E. CASTRO
G.R. No. 189061
Contributor: Destajo, Leslie Ann F.

DOCTRINE: Art. 2127 of the New Civil Code

Art. 2127. The mortgage extends to the natural accessions, to the improvements, growing fruits,
and the rents or income not yet received when the obligation becomes due, and to the amount of
the indemnity granted or owing to the proprietor from the insurers of the property mortgaged, or
in virtue of expropriation for public use, with the declarations, amplifications and limitations
established by law, whether the estate remains in the possession of the mortgagor, or it passes
into the hands of a third person.

FACTS:

Tomas Cloma, father of Adoracion Cloma acquires from UnionBank two parcels of land, which
was formerly owned and mortgaged by the respondents. Midway Maritime And Technological
Foundation is the lessee of the two parcels of land. During the existence of the mortgage, CCC’s
board of directors and the respondents agreed to a 15-year lease of a portion of the property to
where the respondents build the residential building, which is now in dispute.

Dr. Manglicmot, husband of Adoracion, denied respondents’ ownership of the residential building
and claimed that Adoracion owns the building, having bought the same together with the land on
which it stands. He argues that the lease between CCC and the respondents already expired at
the time of the sale and they are now the current lessees of the property, albeit the residential
house is still standing inside the school compound.

Was there a lease agreement between the petitioner and the respondents as regards the
residential building?

SUGGESTED ANSWER:

Yes, a lease agreement exists.

Jurisprudence provides that, once a contact of lease is shown to exist between the
parties, the lessee cannot by any proof, however strong, overturn the conclusive
presumption that the lessor has a valid title to or a better right of possession to the subject
premises than the lessee.
 Adoracion’s subsequent acquisition of the two parcels of land from her father does
not necessarily entail the acquisition of the residential building. "A building by itself is a
realor immovable property distinct from the land on which it is constructed and therefore
can be a separate subject of contracts."

Article 2127 of the Civil Code extends the effects of the real estate mortgage to
accessions and accessories found on the hypothecated property when the secured
obligation becomes due. The law is predicated on an assumption that the ownership of
such accessions and accessories also belongs to the mortgagor as the owner of the
principal. The provision has thus been seen by the Court, x x x, to mean that all
improvements subsequently introduced or owned by the mortgagor on the encumbered
property are deemed to form part of the mortgage. That the improvements are to be
considered so incorporated only if so owned by the mortgagor is a rule that can hardly be
debated since a contract of security, whether real or personal, needs as an indispensable
element thereof the ownership by the pledgor or mortgagor of the property pledged or
mortgaged.

The rationale should be clear enough — in the event of default on the secured
obligation, the foreclosure sale of the property would naturally be the next step that can
expectedly follow. A sale would result in the transmission of title to the buyer which is
feasible only if the seller can be in a position to convey ownership of the thing sold (Article
1458, Civil Code). It is to say, in the instant case, that a foreclosure would be ineffective
unless the mortgagor has title to the property to be foreclosed.

Hence there exists a lease agreement between the parties.

 Heirs of Joaquin Limense v. Rita Vda. De Ramos, et. al.,
GR No. 152319, October 28, 2009;
Sagarino, Dapnee C.

DOCTRINE:
Articles 448 and 546 of the New Civil Code provide:
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.”

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.

FACTS:
Lozada was the registered owner of a land, subdivided it into five lots and donated it to his
daughters in 1932.

Dalmacio Lozada was the registered owner of a parcel of land. Dalmacio Lozada subdivided his
property into five (5) lots, namely: Lot Nos. 12-A, 12-B, 12-C, 12-D and 12-E. By virtue of the
Deed of Donation executed by Dalmacio Lozada, OCT No. 7036, which was registered in his
name, was canceled and, in lieu thereof, Transfer Certificates of Title (TCTs) bearing Nos. 40041,
40042, 40043, 40044, and 40045 were issued in favor of the donees, except TCT No. 40044,
which remained in his name. These new TCTs were annotated at the back of OCT No. 7036.

Thereafter, TCT No. 96886 was issued in the name of Joaquin Limense (petitioner) covering the
very same area of Lot No. 12-C. Petitioner secured a building permit for the construction of a
hollow block fence on the boundary line between his aforesaid property and the adjacent parcel
of land, designated as Lot No. 12-D. The fence, however, could not be constructed because a
substantial portion of respondents' residential building in Lot No. 12-D encroached upon portions
of Petitioner’s property in Lot No. 12-C.

Petitioner demanded the removal of the encroached area; however, respondent ignored both oral
and written demands. The parties failed to amicably settle the differences between them despite
referral to the barangay. Thus, the petitioner, instituted a complaint against respondents before
the Regional Trial Court for removal of obstruction and damages. RTC rendered a decision
dismissing the complaint. Thereafter, the CA further ruled that a co-ownership existed over Lot
No. 12-C between petitioners and respondents.

Respondents being builders in good faith, what are the respective rights of the parties relative to
the portions encroaching upon respondents' house?

SUGGESTED ANSWER:

Articles 448 and 546 of the New Civil Code provide:

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.”

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.

In this case, petitioners have the right to appropriate said portion of the house of respondents
upon payment of indemnity to respondents, as provided for in Article 546 of the Civil Code.
Otherwise, petitioners may oblige respondents to pay the price of the land occupied by their
house. However, if the price asked for is considerably much more than the value of the portion of
the house of respondents built thereon, then the latter cannot be obliged to buy the land.
Respondents shall then pay the reasonable rent to petitioners upon such terms and conditions
that they may agree. In case of disagreement, the trial court shall fix the terms thereof. Of course,
respondents may demolish or remove the said portion of their house, at their own expense, if they
so decide.

The choice belongs to the owner of the land, a rule that accords with the principle of accession
that the accessory follows the principal and not the other way around.37 Even as the option lies
with the landowner, the grant to him, nevertheless, is preclusive. He must choose one. He cannot,
for instance, compel the owner of the building to instead remove it from the land.
 SERAFIN CHENG, Petitioner, v. SPOUSES VITTORIO and MA. HELEN
DONINI, Respondents.
G.R. NO. 167017: June 22, 200
Contributor: Saumay, Norjana B.

Doctrine: 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.

Bar Question:

Serafin Cheng entered into a verbal lease agreement with spouses Vittorio and Ma. Helen
Donini of his property located at 479 Shaw Blvd., Mandaluyong City. Bearing the interim
grant of authority executed by petitioner, respondents proceeded to introduce
improvements in the premises. However, before respondents’ business could start and
before a final draft of the lease agreements could be executed and signed, the parties
began to have serious disagreements. Petitioner demanded the deposit and rental fees
from the respondents signifying that he had no intention to continue with the agreement
should the respondents failed to pay. Respondents ignored such letter and continued to
occupy the premises until their caretaker voluntarily surrendered the same to petitioner.
Respondents then filed an action and demanded that they be paid the full amount of the
renovations and improvements they introduced to the property.

Are spouses Vittorio and Ma. Helen Donini possessors in good faith?

Answer:

No, they cannot be considered possessors in good faith.

Article 526 of the Civil Code defines a possession in good faith as one who is not aware that there
exists in his title or ode of acquisition any flaw which invalidates it, and a possession in bad faith
as one who possesses in any case contrary to the foregoing. In other words, 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. In the case
at bar, spouses Vittorio and Ma. Helena cannot be considered possessors or builders in good
faith. The principle of possessor in good faith cannot be applied to a lessee because he knows
that he is not the owner of the property leased. Neither can he denied that ownership or title of
his lessor. And despite knowing this, he introduces improvements n said property at his own risk
in the sense that he cannot recover their value from the lessor, much less retain the premises
until such reimbursement. By being mere lessees, the spouses knew that their right to occupy the
premises existed only for the duration of the lease. Therefore, the spouses cannot be considered
possessors in good faith.
 Eden Ballatan, et. al., v. Court of Appeals, et. al.,
GR No. 125683, March 2, 1999;
Soriano Alyssa Chantelle Deb

DOCTRINE: Good faith is always presumed, and upon him who alleges bad faith on the part of
a possessor rests the burden of proof.

Article 448 of the Civil Code provides:

“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.

FACTS:
X constructed her house on Lot A. During the construction, she noticed that the concrete fence
and side pathway of the adjoining house of Y encroached on the entire length of the eastern side
of her property. Her building contractor informed her that the area of her lot was actually less than
that described in the title. X then informed Y of this discrepancy and his encroachment on her
property. Y, however, claimed that his house, including its fence and pathway, were built within
the parameters of his father’s lot; and that this lot was surveyed by an authorized surveyor
Engineer Z. X made a written demand on Y to remove and dismantle their improvements on Lot
A. Y refused.

Is Y’s refusal tenable?

SUGGESTED ANSWER:
Yes, because Y is deemed a builder in good faith.

The law provides that 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 building, planting or sowing, after
payment to the builder, planter or sower of the necessary and useful expenses, and in the proper
case, expenses for pure luxury or mere pleasure. The owner of the land may also oblige the
builder, planter or sower to purchase and pay the price of the land. If the owner chooses to sell
his land, the builder, planter or sower must purchase the land, otherwise the owner may remove
the improvements thereon. The builder, planter or sower, however, is not obliged to purchase the
land if its value is considerably more than the building, planting or sowing. In such case, the
builder, planter or sower must pay rent to the owner of the land.
In this case, there is no evidence, much less, any allegation that Y was aware that when he built
his house he knew that a portion thereof encroached on X’s adjoining land. Good faith is always
presumed, and upon him who alleges bad faith on the part of a possessor rests the burden of
proof. X is deemed a builder in good faith until the time X informed him of the encroachment on
her property.

Thus, Y’s refusal is tenable.

 Mercy Vda. De Roxas, v. Our Lady’s Foundation, Inc.,
GR No. 182378, March 6, 2013;
Tapulado, Cathyrine

Doctrine: From when does the value of property encroached computed

Merry Sy filed a complaint for recovery of ownership of a portion of her residential land located at
Midori Village, Cebu City against Henry Chua who encroached on her property by arbitrarily
extending his concrete fence beyond the correct limits. Chua passed the blame to Midori Village
Inc. (MVI) and claimed that he only occupied the adjoining portion in order to get the equivalent
area of what he had lost when MVI trimmed his property for the subdivision road.

The Regional Trial Court held that MVI occupied a total of 112 square meters of Sy's lots and, in
turn, trimmed his property by 92 square meters. A writ of execution was issued ordering MVI to
reimburse Chua for the value of 92 sqm. property plus legal interest to be reckoned from the time
the amount was paid to the third-party defendant Merry Sy.

Is the amount to be reimbursed by MVI to Chua be filed at the prevailing market value at the time
of payment?

SUGGESTED ANSWER:

Yes, Under Article 448 pertaining to encroachments in good faith, as well as Article 450 referring
to encroachments in bad faith, the owner of the land encroached upon Chua has the option to
require Midori Village Inc. (MVI) respondent builder to pay the price of the land.

Although the provisions of the Civil Code do not explicitly state a reckoning period for valuing the
property, Ballatan V. CA already specifies that in the event that the seller elects to sell the lot, the
price must be fixed at the prevailing market value at the time of payment. More recently, Tuatis v.
Sps Escol, illustrates that the present or current fair value of the land is to be reckoned at the time
the landowner elected the choice, and not at the time that the property was purchased.

Hence, the amount to be reimburse by MVI shall be the prevailing market value at the time of
payment.
 Heirs of Emiliano Navarro v. Intermediate Appellate Court, et. al.,
GR No. 68166, February 12, 1997;
Delan, John Lee

DOCTRINE: Accretion on a sea bank is a land of public domain, therefore cannot be registered.

Art. 457, accretion as a mode of acquiring property requires the concurrence of the following
requisites:

1. That the accumulation of soil or sediment be gradual and imperceptible;

2. That it be the result of the action of the waters of the river; and

3. That the land where the accretion takes place is adjacent to the bank of the river.

Bar Question:

Mark’s registered property was bounded in the east side by the Dizon River, while the west side
of the same property was bounded by the Tria River, the northern side of the same property is
fronting the Pepito Bay. The Dizon and Tria river flows down to the Pepito Bay. Sometime in 1940,
Mark planted bakawan and palapat in the northern side of his property. In 1960, Mark found out
that a parcel of land of over 14 hectares had developed in the northern side of his property where
he found Jude. Mark then filed for the registration of the subject parcel of land with the Registry
of Deeds on the ground of accretion and another case for ejectment against Jude.

The Court, through Judge Samson, dismissed the petition for registration of the subject parcel of
land on the ground that the subject parcel of land in the northern part of Mark’s property is a land
of public domain since it is fronting the Pepito Bay making it a foreshore land and therefore is not
registerable. While Judge Miranda also denied the ejectment case filed against Jude.

Aggrieved of the decision, Mark wanted to appeal and sought for your legal assistance. If you are
Mark's lawyer, what legal advice would you give to him?

Suggested Answer:

If I were the lawyer, I would advise him not to appeal and that the decision of the Court is correct.

Under Art. 457, accretion as a mode of acquiring property requires the concurrence of the
following requisites: 1. That the accumulation of soil or sediment be gradual and imperceptible; 2.
That it be the result of the action of the waters of the river; and 3. That the land where the accretion
takes place is adjacent to the bank of the river. Further the facts of the present case falls squarely
with the case of Heirs of Navarro v. IAC, in which the court has settled that if the accretion were
to be attributed to the action of either or both of the Talisay and Bulacan Rivers, the alluvium
should have been deposited on either or both of the eastern and western boundaries of
petitioners' own tract of land, not on the northern portion thereof which is adjacent to the Manila
Bay. Clearly lacking, thus, is the third requisite of accretion, which is, that the alluvium is deposited
on the portion of claimant's land which is adjacent to the river bank.

In the present case, the requirement that the land where the accretion takes place is adjacent to
the bank of the river is wanting. The facts of the present case provided that the alluvium developed
in the northern side of Mark’s property fronting the Pepito Bay and not on either of Dizon and Tria
River.

Therefore, I will advise Mark not to pursue the appeal and that the decisions issued by the Court
were correct.
 Heirs of Francisco Narvasa et. al., VS. Emilliana et. al.,
G.R. No. 182908. August 6, 2014
Contributor: Dungog, Franklin P.

Doctrine: Article 457 of the Civil Code states the rule on accretion as follows: "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.”

Bar Question:

John, Peter and Paul were heirs of the motherland. Peter applied and granted a homestead patent
of the riparian land occupying the northern portion of the Motherland adjacent to the river. Paul
was also granted homestead of the riparian land occupying the southern portion of the Motherland
adjacent to the river. The homestead patent became the basis for the issuance of a Torrens
certificate of title in the name of Peter and Paul. John occupied the remaining portion of the
Motherland. Decades later, both portions of the Motherland adjoining the river acquires an
accretion. The right of accretions later on was issued and divided in proportion to the area of Peter
and Paul which was located adjacent to the river. John filed a complaint against Pedro and Pablo
for the reconveyance and partition of the accretions. John claims that since he is one of the
owners of motherland he likewise entitled to the right of accretions even though it was registered
in the names of Peter and Paul. Is John entitled to the right over the acquired accretions of
adjacent River?

Suggested answer:

John is not entitled to the right over the accretions.

Article 457 of the Civil Code states the rule on accretion as follows: "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.

In this case, John is not the riparian owner of the Motherland to which the Accretions had attached,
hence, he cannot assert ownership of Accretion. Therefore, whether through accretion or,
independently, through prescription, the discernible conclusion is John’s claim of title over the
Accretions had no basis and cannot be reconveyed in his favor. This is especially so since on the
other end of the fray lie respondents armed with a certificate of title in their names covering
Accretions coupled with their possession thereof, both of which give rise to the superior credibility
of their own claim. Hence, petitioners' action for reconveyance with respect to both accretions
must altogether fail.
 Spouses Crispin & Caridad Galang v. Spouses Conrado & Fe Reyes,
GR No. 184746, August 8, 2012;
Laurente, Christopher

DOCTRINE

Article 461 provides that River beds which are abandoned through the natural change in the
course of the waters ipso facto belong to the owner whose lands are occupied by the new course
in proportion to the area lost. However the owners of the land 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.

QUESTION

Sisa, on January 4, 1977, filed a case for the annulment of OCT no. 777 against Crispin and
Basilio in the RTC. Sisa alleged that she is the owner of two properties: 1) a subdivision project
known as Ibarra Heights Subd. and 2) an adjoining property covered by TCT no. 888 that the said
properties were separated by the Maria Clara creek which dried up in 1980 when it changed its
course and passed through Ibarra Heights Subdivision. Also, Sisa alleged that, by employing
fraud and manipulation, Crispin and Basilio were able to obtain a certificate of title from DENR.

Crispin and Basilio answered that the subject of the complaint was part of the creek and was
awarded to them after the application of free patent from DENR. Further, they also claimed that
their predecessor in interest had been in possession, occupation and cultivation and ownership
of the land for quite some time. It was also found in the answer that TCT no. 888 belonged to
Simoun, Cripin and Basilio’s predecessor in interest. Is Sisa correct in claiming that she is still the
owner of the subject land?

SUGGESTED ANSWER:

No. the allegation is not proven, and Sisa failed to adduce indubitable evidence to establish her
claim that Crispin and Basilio fraudulently registered the subject land.

Jurisprudence provides that the natural abandonment of the old course must be shown. It must
be proven that the creek indeed changes its course without artificial or man-made intervention.
Three key elements by clear and convincing evidence which includes: 1) the old course of the
creek; 2) The new course of the creek; 3) the change of course of the creek from the old location
to the new location by natural occurrence.

In the case at bench, it is not clear whether or not the Maria Clara creek dried up naturally nor did
private respondents submit any findings or report from the Bureau of Lands or DENR who has
jurisdiction of the subject matter. Worse is that it failed to specify which location is being disputed
by the contending parties.
Hence, Sisa is not correct.
 Wilfredo & Lolita Vagilidad, v. Gabino & Dorothy Vagilidad,
GR No. 161136, November 16, 2006;
Anore, Mario Jr.

DOCTRINE

Art. 1544. If the same thing should have been sold to different vendees, the ownership shall be
transferred to the person who may have first taken possession thereof in good faith, if it should
be movable property.

Should it be immovable property, the ownership shall belong to the person acquiring it who in
good faith recorded it in the Registry of Property.

QUESTION

X owned the land with Lot No. 1253. After the death of X his son, A sold a portion of Lot No.
1253(which is Lot No. 1253-b) to G. In view of X’s death his children, A, B, and C executed an
extrajudicial settlement of Estate, adjudicating the entire Lot No. 1253 to A.

G filed a petition for the surrender of the TCT No. T-16694, covering Lot No. 1253 against A. G
alleged that being the owner of Lot No. 1253-B he is entitled to ask for the surrender of the owner’s
copy of TCT No. T-16694 in order to effect the transfer of the title to the name of G. However, as
per motion of both counsels, since the parties seemed to have already reached an amicable
settlement without knowledge of their counsels, the trial court issued an Order sending the case
to the archives

After which the sale of Lot No. 1253-B to W was registered with the Registry of Deeds.
Consequently, TCT No. T-18023, cancelling TCT No. 16694, was issued in favor of W pursuant
to Deed of Absolute Sale.

Spouses G and M filed a complaint for annulment of document, reconveyance with the RTC
against spouses W and L. They claimed that they are the lawful owners of Lot No. 1253-B which
was sold by A in 1986.

A disinterested witness, M, testified and manifested that she used to work as secretary for Atty. Z
and co-signed as witness in both Deeds. She stated that Atty. Z instructed her to prepare the two
documents in the last week of November 1989. She was present when G signed the Deed of
Absolute Sale. She testified that after G left, A and his wife F arrived and signed the Deed of
Absolute Sale of Portion of Land.

Mabuhay also testified that when she prepared the two documents, she noticed the similarity of
Lot No. 1253 as technically described in both documents but she did not call the attention of Atty.
Z. She likewise stated that Atty. Z specifically instructed her to assign the same document number
to the two documents notarized on December 7, 1989.
The trial court ruled in favor of W. But, on appeal, the Court of Appeals ruled in favor of G.

Spouses W and L contend that the appellate court should have upheld the title of W under Article
1544 of the Civil Code and the doctrine of double sale where the buyer who is in possession of
the Torrens Title must prevail. Since he is not bound to go beyond the certificate of title, he has
acquired the subject property in due course and in good faith. Is the Court of Appeals correct in
ruling in favor of G?

SUGGESTED ANSWER

The Court of Appeals was correct in ruling in favor of G.

W’s reliance on Article 1544 is misplaced. While title to the property was issued in W’s name on
February 15, 1990, the following circumstances show that he registered the subject parcel of land
with evident bad faith.

Art. 1544. If the same thing should have been sold to different vendees, the ownership shall be
transferred to the person who may have first taken possession thereof in good faith, if it should
be movable property.

Should it be immovable property, the ownership shall belong to the person acquiring it who in
good faith recorded it in the Registry of Property.

Should there be no inscription, the ownership shall pertain to the person who in good faith was
first in the possession; and, in the absence thereof, to the person who presents the oldest title,
provided there is good faith.

The Deed of Absolute Sale of Portion of Land dated December 7, 1989 between A and W is
tainted with blatant irregularities.

The testimony of a disinterested witness, M, established the irregularity. M used to work as

secretary for Atty. Z and co-signed as witness in both Deeds. She stated that Atty. Z instructed
her to prepare the two documents in the last week of November 1989. She was present when G
signed the Deed of Absolute Sale. She testified that after G left, A and his wife F arrived and
signed the Deed of Absolute Sale of Portion of Land.

Mabuhay testified that when she prepared the two documents, she noticed the similarity of Lot
No. 1253 as technically described in both documents but she did not call the attention of Atty. Z.
She likewise stated that Atty. Z specifically instructed her to assign the same document number
to the two documents notarized on December 7, 1989.

From the series of events, it can be reasonably inferred that appellees W, A and Atty. Z connived
in attempting to deprive appellants of Lot No. 1253-B.
Hence, the Court of Appeals is correct in ruling in favor of G since W is in bad faith in the
possession of Lot No. 1253-B.
 K) VICENTE TORRES, JR.,CARLOS VELEZ, AND THE HEIRS OF MARIANO VELEZ,
NAMELY: ANITA CHIONG VELEZ, ROBERT OSCAR CHIONG VELEZ, SARAH JEAN
CHIONG VELEZ AND TED CHIONG VELEZ, petitioners,vs.LORENZO LAPINID AND JESUS
VELEZ, respondents
G.R. No. 187987. November 26, 2014
Contributor: Batulan, Paulo

Doctrines:
A co-owner has an absolute ownership of his undivided and pro indiviso share in the co-owned
property. A co-owner is an owner of the whole and over the whole he exercises the right of
dominion, but he is at the same time the owner of a portion which is truly abstract.

Giannis Ant, Trey Yo, Luca Don and Le Bron are co-owners of several parcels of land. Giannis,
Trey and Luca prayed that the deed of sale by Le Bron to Steph Curr be declared null and void
arguing that the sale of a definite portion of a co-owned property without notice to the other co-
owners is without force and effect.

Is the sale valid?

Suggested Answer:

Yes, the sale is valid.

Art. 493 of the Civil Code provides that, each co-owner shall have the full ownership of his part
and of the fruits and benefits pertaining thereto, and he may therefore alienate, assign or
mortgage it, and even substitute another person in its enjoyment, except when personal rights
are involved. But the effect of the alienation or the mortgage, with respect to the co-owners, shall
be limited to the portion which may be allotted to him in the division upon the termination of the
co-ownership.

In the case at bar, Le Bron's right of enjoyment over the property owned in common must be
respected as long he uses the property to the purpose for which it is intended and he does not
injure the interest of the co-ownership. Giannis, Trey and Luca have no right to enjoin Le Bron
who intends to alienate or substitute his abstract portion or substitute a third person in its
enjoyment. Steph Curr, as a transferee, validly obtained the same rights of Le Bron from the date
of the execution of a valid sale. Absent any proof that the sale was not perfected, the validity of
sale subsists. In essence, Steph steps into the shoes of Le Bron as co-owner of an ideal and
proportionate share in the property held in common.

Therefore, the sale is valid.

 Vilma Quitos et. al v. Pelagia Nicolas et. al
GR No. 210252, June 16, 2014
Contributor: De Aroz, Kevin B.
Question:

John and Marcia are siblings. In 2002, John brought an action for partition against Marcia
which was dismissed by the RTC for failure of the parties, as well as their counsels, to appear
despite due notice. Having failed to secure a favorable decision for partition, John’s siblings
instead resorted to executing a Deed of Adjudication to transfer the property in favor of the ten
(10) siblings.

Marcia filed a complaint for Quieting of Title and Damages against John and siblings
wherein they alleged that during their parents’ lifetime, the couple distributed their real and
personal properties in favor of their ten (10) children. Upon distribution, Marcia alleged that they
received the subject property and the house constructed thereon as their share. They likewise
averred that they have been in adverse, open, continuous, and uninterrupted possession of the
property for over four (4) decades and are, thus, entitled to equitable title thereto. They also deny
any participation in the execution of the aforementioned Deed of Adjudication and the Agreement
of Subdivision.

John countered that Marcia’s cause of action was already barred by estoppel when one
of Marcia’s siblings offered to buy the 7/10 undivided share of John’s siblings. In addition, they
claimed that Bienvenido and Escolastica Ibarra mortgaged the property but because of financial
constraints, John’s siblings spouses Candelario had to redeem the property in their behalf. Not
having been repaid by Bienvenido and Escolastica, the Candelarios accepted from their co-
respondents their share in the subject property as payment.

Did the petitioners able to prove ownership over the property?

Suggested Answer:

No. Petitioners were not able to prove ownership over the property.

Under the Civil Code, for an action to quiet title to prosper, two indispensable requisites must
concur, namely:

(1) the 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 the title
must be shown to be in fact invalid or inoperative despite its prima facie appearance of
validity or efficacy.

In the case at bar, the petitioners’ cause of action must necessarily fail mainly in view of the
absence of the first requisite. Their alleged open, continuous, exclusive, and uninterrupted
possession of the subject property is belied by the fact that respondent siblings, in 2005, entered
into a Contract of Lease with the Avico Lending Investor Co. over the subject lot without any
objection from the petitioners. Petitioners’ inability to offer evidence tending to prove that
Bienvenido and Escolastica Ibarra transferred the ownership over the property in favor of
petitioners is likewise fatal to the latter’s claim. On the contrary, on May 28, 1998, Escolastica
Ibarra executed a Deed of Sale covering half of the subject property in favor of all her 10 children,
not in favor of petitioners alone.

Hence, the petitioner failed were not able to prove ownership over the property.
 Manuel T. De Guia vs. Court of Appeals and Jose B. Abejo represented by his
Attorney-in-Fact, Hermenegilda Abejo-Rivera
GR No. 120864; October 8, 2003
Contributor: Dela Torre, Harvey D.

Bar Question:

AJ instituted an action for recovery of possession with damages against his co- owner DG. AJ
contends that he is the owner of the ½ undivided portion of a property used as a fishpond
registered Register of Deeds of Bulacan. DG continues to possess and use the fishpond without
any contract and without paying rent to AJ’s damage and prejudice. DG refuses to surrender
ownership and possession of the fishpond despite repeated demands.

In his answer, DG alleged that as a co-owner of the property he cannot be filed with an action of
ejectment . As a counsel for AJ can he as a co-owner file an action for ejectment against his co-
owner DG? Can AJ exclude DG as a co-owner of the fishpond?

Suggested Bar Answer:

Yes, As a counsel for AJ he can file an action for ejectment against his co- owner DG. Under
Article 487 of the Civil Code provides, “any one of the co- owners may bring an action in ejectment.
Hence, any co-owner may file an action under Article 487 not only against a third person, but also
against another co- owner who takes exclusive possession and asserts exclusive ownership of
the property.” In the case at bar, AJ and DG are co-owners of the fishpond. Therefore, AJ can
file an action for ejectment against his co- owner DG. No, AJ cannot exclude DG as a co-owner
of the fishpond. In the case of Sps. Engreso v. De La Cruz it provides that “a co-owner cannot
recover a material or determinate part of a common property prior to partition as follows that it is
a basic principle in civil law that before a property owned in common is actually partitioned, all
that the co-owner has is an ideal or abstract quota or proportionate share in the entire property.
In the case at bar, AJ’s only purpose of the action is to obtain recognition of the co-ownership.
Therefore AJ cannot seek exclusion of the DG.
 G.R. No. 151153 December 10, 2007

SPOUSES CHARLITO COJA and ANNIE MESA COJA, petitioners,

vs.
HON. COURT OF APPEALS and HEIRS OF FELICIANO AQUILLO, SR., namely:
QUINCIANO VICTOR, SR., LORNA A. VICTOR, ANTONIO VICTOR, QUINCIANO A.
VICTOR, JR., SUSANA A. VICTOR, CLARA AQUILLO, CARMENCITA AQUILLO, AGAPITO
AQUILLO, NOEL AQUILLO, ADONIS AQUILLO, FELICIANO AQUILLO, JR., RONALD
AQUILLO and ALDRIN AQUILLO, respondents
Contributor: Pangilinan, Jude Kenneth

Question:

John and Shirley was married and had 2 children. John and Shirley acquired a 120sqm lot located
in Poblacion Masbate upon which they built their conjugal home. The lot was covered by a tax
declaration only. Thereafter Shirley died and few years later John cohabited with Meg. However
after Shirley died the heirs of Shirley failed to partitioned their hereditary shares of inheritance.
While John and Meg were cohabiting Meg acquired a 192 sqm lot from the heirs of Jack. She late
sold 40 sqm to Nilo leaving her with only 151.9 sqm in total. On July 7, 1965 2 days before John
died he married Meg and after he died the heirs also failed to partitioned their respective shares
of inheritance.

Sometime in 1969, Meg was issued Tax Declaration No. 4424 over the remaining 151.9 square
meters of the property covered by Tax Declaration No. 02115. The aforesaid Tax Declaration was
later cancelled by Tax Declaration No. 3443-Rev. On September 10, 1973, Tax Declaration No.
3514 was issued, effectively canceling Tax Declaration No. 3443-Rev. Also, in said Tax
Declaration No. 3514, the area originally covered by Tax Declaration No. 3443-Rev was increased
from 151.9 square meters to 336 square meters, and it included the 120-square meter property
originally covered by Tax Declaration No. 1151

Thereafter Meg sold the 336sqm lot to Sps. Panganiban in which they executed a Deed of
absolute sale. The heirs filed an action for recovery of possession and ownership with damages,
against the Sps. Panganiban and Meg. Respondents claimed that they are the true and lawful
heirs of the John and Shirley; that Meg refused to deliver the property to its rightful owners despite
repeated demands; that Meg appropriated the subject property to herself and had the tax
declaration transferred to her name; that Meg sold the property to the Sps. Panganiban; and that
the Spouses Panganiban failed to deliver the subject property to the rightful heirs despite repeated
demands.

The RTC ruled in favor of the Sps. Panganiban and Meg. However when appealed the CA
reversed the decision of the RTC stating that :

the property formerly covered by Tax Declaration No. 1151, with an area of 120 square meters,
is the conjugal property of John and Shirley having been acquired during their marriage.
Under the law, upon the death of Shirley, one-half of said property, or 60 square meters, was
transmitted to her heirs, namely John and the children, at 20 square meters each, while the
remaining one-half pertained to John. alone as his share in the conjugal property. Upon the
death of John., his rights over the property, consisting of his inheritance from his wife and his
share in the conjugal partnership, or a total of 80 square meters, were transmitted to
his heirs the children, and his widow, Meg. Thus, Meg is entitled to only 26.6666 square meters
and the heirs of John and Meg are entitled to the remaining 93.3333 square meters of the
subject property. Therefore, Meg had no authority to sell their portions of the property.

Is the Court of Appeals correct in stating that Meg had no authority to sell the portions of the
property decide.

Suggested answer:

Yes the Court of appeals was right in deciding that Meg had no authority to sell their portions of
the property.

It is a basic principle in civil law that before a property owned in common is actually partitioned,
all that the co-owner has is an ideal or abstract quota or proportionate share in the entire property.
A co-owner has no right to demand a concrete, specific or determinate part of the thing owned in
common because until division is effected his right over the thing is represented only by an ideal
portion.

As such, the only effect of an action brought by a co-owner against a co-owner will be to obtain
recognition of the co-ownership; the defendant cannot be excluded from a specific portion of the
property because as a co-owner he has a right to possess and the plaintiff cannot recover any
material or determinate part of the property.

A co-owner may file an action for recovery of possession against a co-owner who takes
exclusive possession of the entire co-owned property. However, the only effect of such action is
a recognition of the co-ownership. The courts cannot proceed with the actual partitioning of the
co-owned property. In fine, judicial or extrajudicial partition is necessary to effect physical
division of the subject 120-square meter property.

Thus the Court of Appeals was correct in its decision. Meg had no authority to sell the portions
of property since the lot in question is a property owned in common until a division is effected.
 Spouses Jose and Hermogena Engreso v. Herminio and Nestoria dela Cruz,
GR No. 148727, April 9, 2003;
Rances, Ranche Rik

A and B, siblings, co-owned an undivided property which they inherited from their parents. A
alleged that B leased the co-owned property to a bank, thus prompting A to file an action to deliver
to him the ½ portion of the property.

Can A’s action be given due course?

SUGGESTED ANSWER:

No, A’s action cannot be given due course.

It is a basic principle in civil law that before a property owned in common is actually partitioned,
all that the co-owner has is an ideal or abstract quota or proportionate share in the entire property.
A co-owner has no right to demand a concrete, specific or determinate part of the thing owned in
common because until division is effected his right over the thing is represented only by an ideal
portion. As such, the only effect of an action brought by a co-owner against a co-owner will be to
obtain recognition of the co-ownership. The defendant cannot be excluded from a specific portion
of the property because as a co-owner he has a right to possess and the plaintiff cannot recover
any material or determinate part of the property

In the case at hand, A’s action can only be to obtain recognition of his co-ownership to the lot with
B. A cannot demand that he be delivered a specific portion of the property because if the property
has not been partitioned, all that A has is an ideal right over the property.

Thus, A’s action cannot be given due course.

 Leonor B. Cruz, v. Teofila M. Catapang,
GR No. 164110, February 12, 2008;
Rodriguez, Jeric

Rick and Morty are the co-owners of a parcel of land. With the consent of Morty, Tammy built a
house on a lot adjacent to the co-owned parcel of land. However, the house intruded on a portion
of the subject property. Rick visited the property and seeing that the house intruded on a portion
of the property, he made several demands upon Tammy to demolish the intruding structure and
to vacate the portion encroaching on their property. However, Tammy refused to heed on the
demands. With this, Rick filed a case for forcible entry against Tammy. Tammy countered that
the complaint for forcible entry cannot prosper because her entry into the property was not through
strategy or stealth due to the consent of one of the co-owners. Is the contention of Tammy correct?
Decide.

Suggested Answer:

No. In the case of Cruz vs Catapang, the Supreme Court ruled that a co-owner cannot devote
common property to his or her exclusive use to the prejudice of the co-ownership. A co-owner
cannot give valid consent to another to build a house on the co-owned property, which is an act
tantamount to devoting the property to his or her exclusive use.

Furthermore, Articles 486 and 491 of the Civil Code provide:

Art. 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.

Art. 491. None of the co-owners shall, without the consent of the others, make
alterations in the thing owned in common, even though benefits for all would result
therefrom. However, if the withholding of the consent by one or more of the co-owners
is clearly prejudicial to the common interest, the courts may afford adequate relief.

Giving consent to a third person to construct a house on the co-owned property will injure the
interest of the co-ownership and prevent other co-owners from using the property in accordance
with their rights.

Under Article 491, none of the co-owners shall, without the consent of the others, make alterations
in the thing owned in common. It necessarily follows that none of the co-owners can, without the
consent of the other co-owners, validly consent to the making of an alteration by another person,
such as respondent, in the thing owned in common. Alterations include any act of strict dominion
or ownership and any encumbrance or disposition has been held implicitly to be an act of
alteration. The construction of a house on the co-owned property is an act of dominion. Therefore,
it is an alteration falling under Article 491 of the Civil Code. There being no consent from all co-
owners, Tammy had no right to construct his house on the co-owned property.

Consent of only one co-owner will not warrant the dismissal of the complaint for forcible entry filed
against the builder. The consent given by Morty in the absence of the consent of Rick did not vest
upon Tammy any right to enter into the co-owned property. His entry into the property still falls
under the classification "through strategy or stealth."
 CORINTHIAN REALTY, INC. vs. HON. COURT OF APPEALS
G.R. No. 150240 December 26, 2002
Estrera, Kelvin G.

Doctrine: A co-owner who sells the entire property without obtaining the consent of the other co-
owners does not render the sale null and void. The sale will affect only his own share but not
those of the other co-owners who did not consent to the sale.

Bar Question: A parcel of land situated in Las Pinas is co-owned by Emilio Martin and Matilde
Martin (Martins) together with private respondent Delfin Guinto (Delfin), Teofilo Guinto, Prudencio
Guinto and Margarita Guinto (Guintos) and the heirs of Spouses Tomas de Leon and Francisca
Medina (Heirs of de Leon). The Martins and Guintos entered into a Deed of Conditional Sale with
Corinthian Realty Inc. (Corinthian). However, Delfin and the heirs of de Leon did not affix their
signature in the said instrument although their names appeared therein. Before the execution of
the Deed of Conditional Sale, Corinthian paid several amounts to Martins and Guintos. Corinthian
however failed to pay the balance of the purchase price within ninety (90) days, as stipulated. The
action for specific performance was filed by Corinthian against the Martins and Guintos for not
executing a Deed of Absolute Sale. The Regional Trial Court of Makati (RTC) dismissed the
complaint concluding that it was Corinthian who violated the deed. The Court of Appeals affirmed
the RTC decision. The petitioner filed a petition for review on certiorari which prays for the
reversal of the decision of the Court of Appeals on the ground that the appellate court erred in
holding that the Deed of Conditional Sale was entered into with the co-owners individually.

Is the petitioner correct?

Suggested Answer:

No, the petitioner is not correct.

Article 493 of the New Civil Code states that a co-owner has the right to sell his undivided share.
If he sells the entire property without obtaining the consent of the other co-owners, the sale is not
null and void. Only the rights of the co-owner-seller are transferred, thereby making the buyer a
co-owner of the property. The transferee gets only what his transferor would have been entitled
to after partition. Even if a co-owner sells the whole property as his, the sale will affect only his
own share but not those of the other co-owners who did not consent to the sale.

Here, the appellate court did not err in its ruling that the Deed of Conditional Sale was entered
into with the co-owners individually. Indeed, only the pro-indiviso shares in the property of the co-
owners – signatories Martins and Guintos to the deed were affected by the deed. Petitioner
Corinthian paid specific amounts of money to the co-owners-private respondents-signatories
Martins and Guintos to the deed and even had said -deed notarized despite the absence of the
signatures of private respondent Delfin and Heirs bars the claim of petitioner Corinthian that it
dealt with the co-owners of the property collectively.

Hence, the petitioner is not correct.

 Carolina Vda. De Figuracion, et. al., v. Emilia Figuracion-Gerilla,
GR No. 151334, February 13, 2013;
Montecillo, Danilo

The parties are the heirs of Mr. X who died intestate in May 1958. Lot No. 707 of the Cadastral
Survey of Urdaneta, Pangasinan was originally owned by Mr. Z, covered by an OCT issued in
his name. Mr. Z begot B with his first wife Mrs. Y, whom Mr. Z survived. When he remarried, Mr.
Z had another daughter, petitioner C, with his second wife, W.

B executed a Deed of Quitclaim over the eastern half of Lot No. 707 in favor of her niece, E.
Soon thereafter, petitioner C, executed an Affidavit of Self-Adjudication adjudicating unto herself
the entire Lot No. 707 as the sole and exclusive heir of her deceased parents and also executed
a Deed of Absolute Sale in favor of petitioners H and F. Upon E and her family’s return from the
U.S. and relying on the Deed of Quitclaim, she built a house on the eastern half of Lot No. 707.

The RTC rendered its decision dismissing the complaint for partition, reconveyance, quieting of
title and damages is hereby ordered dismissed whereas the affidavit of self-adjudication, deed
of sale and the transfer certificate of title involving Lot 707 were declared null and void. Upon
appeal, the CA ruled that the RTC erred in refusing to partition Lot No. 707 and declared Lot No.
707 to be owned by E, ½ pro indiviso share; Felipa, ¼ pro indiviso share; and Hilaria, ¼ pro
indiviso share.

ISSUE:

1. Whether or not the respondent can compel the partition of Lot No. 707

SUGGESTED ANSWER:

1. Yes. The first stage in an action for partition is the settlement of the issue of
ownership. Such an action will not lie if the claimant has no rightful interest in the
subject property partnership.

. A co-owner cannot alienate the shares of her other co-owners – nemo dat qui non
habet. As co-owners, each of them had full .ownership of her part and of the fruits and
benefits pertaining thereto. A co-owner is entitled to sell his undivided share, hence a
sale of the entire property by one co-owner without the consent of the other co-owners is
not null and void and only the rights of the co-owner/seller are transferred, thereby
making the buyer a co-owner of the property. In a contract of sale of co-owned property,
what the vendee obtains by virtue of such of sale are the same rights as the vendor had
as co-owner, and the vendee merely steps into the shoes of the vendor as co-owner.
 BENJAMIN CORONEL vs. EMILIA MEKING VDA. DE CORONEL
G.R. No. 121069; February 7, 2003
Contributed by: Kevin M. Suson

Doctrine(s):

● The sale of a property made by the parent-co-owner in favor of a buyer is only valid
insofar as the share of the parent-co-owner is concerned.

● Ratification means that a person under no disability voluntarily adopts and gives sanction
to some unauthorized act or defective proceeding, without his sanction would not be
binding on him.

Bar Question:

Two parcels of land have been passed down, one-half of the whole property was inherited by
a mother ( Emilia ) together with her three (3) minor sons while the other half was inherited by Mr.
F & Ms. A. The property of the mother and sons was allegedly sold to a third party and later went
to Mr. F & Ms. A. The mother & sons started to introduce expensive improvements therein. Mr. F
& Ms. A files a complaint to declare their ownership, the quieting of their title & damages.

Whether Emilia, the mother, validly executed a deed of sale on her own behalf and in
representation of her co-owners children?

Suggested Answer:

No, Emilia cannot validly execute the deed of sale in representation of her three children.

Art. 493 of the New Civil Code provides that each co-owner shall have the full ownership
of his/her part and of the fruits and benefits pertaining thereto, and he may therefore alienate,
assign or mortgage it, and even substitute another in person in its enjoyment, except when
personal rights are involved. But the effect of the alienation or the mortgage, with respect to
the co-owners, shall be limited to the portion which may be allotted to him/her in the
division upon the termination of the co-ownership.

Applying the said provision in the present case, since there is nothing in the facts that
show that the sons were aware of the sale made by their mother, then the alleged silence and
inaction of the sons cannot be interpreted as an act of ratification on their part.

As a consequence, the sale by Emilia is limited to the portion which may be allotted to her
upon the termination of the co-ownership over the subject property with her children.
(t) City of Mandaluyong vs. Antonio N. Urot, Dave Anthony
Aguilar, GR# 137152, Jan. 29, 2001;
 CITY OF MANDALUYONG, petitioner,
vs.
ANTONIO N., FRANCISCO N., THELMA N., EUSEBIO N., RODOLFO N., all surnamed
AGUILAR, respondents.
G.R. No. 137152, January 29, 2001
Contributed By: Dave Anthony E. Urot

DOCTRINE:

Co-Owner is free to alienate, assign. or mortgage his undivided interest in the common property.

QUESTION:

In 1997, petitioner filed with the Regional Trial Court, Branch 168, Pasig City a complaint for
expropriation against the respondents. Petitioner sought to expropriate three (3) adjoining parcels
of land with an aggregate area of 1,847 square meters; respondents constructed residential
houses several decades ago which they had since leased out to tenants until the present.

In 1986, however, the siblings agreed to extrajudicially partition the lots among themselves, but
no action was taken by them to this end. It was only eleven (11) years later, on November 28,
1997 that a survey of the two lots was made33 and on February 10, 1998, a consolidation
subdivision plan was approved by the Lands Management Service of the Department of
Environment and Natural Resources.34 The co-owners signed a Partition Agreement on February
24, 199835 and on May 21, 1998, TCT Nos. 63766 and 63767 were canceled and new titles
issued in the names of the individual owners pursuant to the Partition Agreement.

Petitioner argues that the consolidation of the subject lots and their partition was made more than
six (6) months after the complaint for expropriation was filed on August 4, 1997, hence, the
partition was made in bad faith, for the purpose of circumventing the provisions of R.A. 7279.

Is Petitioner Correct?

SUGGESTED ANSWER:

No.

Article 493 of the Civil Code however provides that Each co-owner shall have the full ownership
of his part and of the fruits and benefits pertaining thereto, and he may therefore alienate, assign
or mortgage it, and even substitute another person in its enjoyment, except when personal rights
are involved. But the effect of the alienation or the mortgage, with respect to the co-owners shall
be limited to the portion which may be allotted to him in the division upon termination of the co-
ownership.

In the instant case, the titles to the subject lots were issued in respondents' names as co-owners
in 1987 ten (10) years before the expropriation case was filed in 1997. As co-owners, all that the
respondents had was an ideal or abstract quota or proportionate share in the lots. This, however,
did not mean that they could not separately exercise any rights over the lots. Each respondent
had the full ownership of his undivided interest in the property. He could freely sell or dispose of
his interest independently of the other co-owners. And this interest could have even been attached
by his creditors. The partition in 1998, six (6) months after the filing of the expropriation case,
terminated the co-ownership by converting into certain and definite parts the respective undivided
shares of the co-owners. The subject property is not a thing essentially indivisible. The rights of
the co-owners to have the property partitioned and their share in the same delivered to them
cannot be questioned for "[n]o co-owner shall be obliged to remain in the co-ownership." The
partition was merely a necessary incident of the co-ownership; and absent any evidence to the
contrary, this partition is presumed to have been done in good faith.
 Lilia Sanchez vs. Court of Appeals,
G.R. No. 152766, June 20, 2003;
Perez, Khim Rey

Doctrine: Each co-owner shall have no right to sell or alienate a concrete, specific or determinate
part of the thing owned in common because his right over the thing is represented by a quota or
ideal portion without any physical adjudication.

Question:

Lilia constructed a house on a lot owned by her parents-in-law. The lot was registered under co-
owners, Leo and five others. By virtue of a Deed of Absolute Sale, the lot was registered to Virginia
supposed by all six co-owners in her favor. Lilia Sanchez claimed that she did not affix her
signature on the document and subsequently refused to vacate the lot, thus prompting Virginia
Teria to file an action for recovery of possession of the lot.
The court ruled in favor of private respondent declaring that the sale was valid only to the extent
of 5/6 of the lot and the other 1/6 remaining as the property of Lilia on account of her signature in
the Deed of Absolute Sale having been established as a forgery. Sometime after, Virginia started
demolishing Lilia’s house without any special permit of demolition from the court. She was forced
to inhabit the portion of the premises that used to serve as the house’s toilet and laundry area.

Was the demolition of the said property proper?

Suggested answer:

No, the demolition of the property is not proper.

According to Jurisprudence, Sanchez Roman defines co-ownership as "the right of common

dominion which two or more persons have in a spiritual part of a thing, not materially or physically
divided.The characteristics of co-ownership are: (a) plurality of subjects, who are the co-owners,
(b) unity of or material indivision, which means that there is a single object which is not materially
divided, and which is the element which binds the subjects, and, (c) the recognition of ideal
shares, which determines the rights and obligations of the co-owners. More so, Article 493 of the
Civil Code gives the owner of an undivided interest in the property the right to freely sell and
dispose of it. He may validly lease his undivided interest to a third party independently of the other
co-owners. But he has no right to sell or alienate a concrete, specific or determinate part of the
thing owned in common because his right over the thing is represented by a quota or ideal portion
without any physical adjudication.

In the case at bar, the relationship between Lilia Sanchez and the sellers in the Deed of absolute
sale in question are Co-owners as defined by previous jurisprudence. Lilia was assigned an
aliquot but abstract part of the property, the metes and bounds of her lot has not been designated.
As she was not a party to the Deed of Absolute Sale voluntarily entered into by the other co-
owners, her right to 1/6 of the property must be respected. Partition needs to be effected to protect
her right to her definite share and determine the boundaries of her property. Such partition must
be done without prejudice to the rights of private respondent Virginia Teria as buyer of the 5/6
portion of the lot under dispute.
 Reynaldo Aguirre vs. Court of Appeals,
G.R. No. 122249, Jan. 29, 2004;
Saavedra, Patrick

Doctrine:

Each co-owner shall have the full ownership of his part and of the fruits and benefits pertaining
thereto, and he may therefore alienate, assign or mortgage it, and even substitute another person
in its enjoyment, except when personal rights are involved.

Question:

Spouses L and E owned a piece of land. After the death of E, L married his second wife M. When
L died, all his heirs agreed that S, a child of the first marriage, should manage and administer the
said property. After S died, his heirs learned that he had executed an Affidavit of Transfer of Real
Property in which he falsely stated that he was the only heir of L. It turned out that while S was
still alive, he sold a portion of the subject land to T and other portion to B. B later on sold the said
portion to R.

Petitioners, all heirs of L, who were all affected by the sale demanded reconveyance of the
portions sold by S, but the vendees refused. Resultantly, petitioners filed a suit against them
seeking the nullity of the documents and partition thereof. The vendees contended that they
acquired the property under the valid deed of sale and petitioners’ cause of action was barred by
laches and prescription.

Was there a valid sale between S and the vendees (T and B) considering the fact that it was made
without the consent of the co-owners?

Suggested Answer:

Yes. Under Article 493 of the New Civil Code, a sale by a co-owner of the whole property as his
will affect only his own share but not those of the co-owners who did not consent to the sale. The
provision clearly provides that the sale or other disposition affects only the seller’s share, and the
transferee gets only what corresponds to his grantor’s share in the partition of the property owned
in common. Since a co-owner is entitled to sell his undivided share, a sale of the entire property
by one co-owner without the consent of the other co-owner is not null and void; only the rights of
the co-owner seller are transferred, thereby making the buyer a co-owner of the property.

Therefore, it is clear that the deed of sale executed by S in favor of the vendees is a valid
conveyance only insofar as the share of S in the co-ownership is concerned.
 Sps. Alexander and Adelaida Cruz vs. Eleuterio Leis,
G.R. No. 125233, March 9, 2000;
Tabanao, Arlan

Doctrine:

While a vendee a retro, under Article 1613 of the Code, "may not be compelled to consent to a
partial redemption," the redemption by one co-heir or co-owner of the property in its totality does
not vest in him ownership over it. Failure on the part of all the co-owners to redeem it entitles the
vendee a retro to retain the property and consolidate title thereto in his name. But the provision
does not give to the redeeming co-owner the right to the entire property. It does not provide for a
mode of terminating a co-ownership.

Question:

In 1923, Adriano Leis(Leis) and Gertrudes Isidro(Isidro) got married. Isidro acquired from the
Department of Agriculture and Natural Resources(DANR) a parcel of land, which was titled in her
name, with the description that she was a “widow”. Leis died in 1973 without executing a will.

Isidro then obtained a loan from Cruz for P15,000, at 5% interest and the loan was secured by a
mortgage over the parcel of land acquired from DANR, but failed to pay on due date. Isidro
executed 2 contracts in favor of Cruz: a Deed of Absolute Sale and a Contract indicating a pacto
de retro sale. Isidro still failed to repurchase the property within 1 year, so she consolidated the
ownership of the land in favor of Cruz. Thereafter when Isidro died, Cruz demanded her heirs to
vacate the premises. The heirs then filed a complaint with the RTC averring that the land was
conjugal property having been purchased during their marriage. The RTC found in favor of the
heirs. Is the RTC correct?

Suggested Answer:

No, the RTC is not correct. Although the land was purchased during the marriage, upon Leis’
death, the conjugal property regime ceased, and gave Isidro an equal portion of Leis’ half of the
property to be divided among his legitimes. Co-ownership of the land then began.

The paraphernal or conjugal nature of the property is not determinative of the ownership of the
disputed property. If the property was paraphernal as contended by petitioners, Gertrudes Isidro
would have the absolute right to dispose of the same, and absolute title and ownership was vested
in petitioners upon the failure of Gertrudes to redeem the property. On the other hand, if the
property was conjugal as private respondents maintain, upon the death of Adriano Leis, the
conjugal partnership was terminate, entitling Gertrudes to one-half of the property. Adriano's
rights to the other half, in turn, were transmitted upon his death to his heirs, which includes his
widow Gertrudes, who is entitled to the same share as that of each of the legitimate children.
Thus, as a result of the death of Adriano, a regime of co-ownership arose between Gertrudes and
the other heirs in relation to the property.
However, upon failure of Adriano Isidro’s Heirs to exercise the right to repurchase the same within
the one-year period stipulated in the "Kasunduan.", the ownership of the land transferred to Cruz.
The essence of a pacto de retro sale is that title and ownership of the property sold are
immediately vested in the vendee a retro, subject to the resolutory condition of repurchase by the
vendor a retro within the stipulated period. Failure thus of the vendor a retro to perform said
resolutory condition vests upon the vendee by operation of law absolute title and ownership over
the property sold.
 Teresita S. Reyes-De Leon vs. Vicente B. Del Rosario
G.R. No. 152862, July 26, 2004;
Contributor: Bhenz Bryle Nino M. Tomilap

Doctrine: Co-Ownership must be established first in partition cases

Question:

X and Y are the cousin and nephew of A, respectively. X and Y claimed that A executed
a deed of absolute sale in favor of Y covering all of her shares in the properties sought to be
partitioned. However, A claimed that she did not execute any deed of sale in favor of Y. A claimed
that the only properties of her inheritance she disposed of were her shares in the Asinan and
Negros properties.

Eventually, Y filed a Complaint for declaration of nullity of deed of sale with damages
before the Regional Trial Court. When the Complaint for declaration of nullity was filed, Y then
moved for the suspension of the partition proceedings. Y then asserted that the action for partition
and the declaration of nullity involve distinct and separate causes of action. The Lower Court ruled
that an order of partition presupposes a state of co-ownership. A argued that the action for
partition may proceed without resolving the issue of co-ownership.

Is Y correct?

Suggested Answer:

No, because the issue of co-ownership must first be resolved in order to effect a partition
of properties. This should be done in the action for partition itself.

Article 494 of the New Civil Code provides that each co-owner may demand at any time
the partition of the thing owned in common, insofar as his share is concerned. Furthermore, the
Supreme Court held in Catapusan vs. Court of Appeals that the issue of ownership or co-
ownership must be resolved first in order to effect a partition, which must be done in the action
for partition itself.

In the present case, what is being filed by Y is an action for partition. Hence, the Court
having jurisdiction will not be able to issue an order to divide the property, unless it makes a
determination as to the existence of co-ownership first. It follows that the Partition Court should
determine and resolve the issue of ownership of the properties subject of the partition case.

Hence, Y is incorrect with her argument.

 Agueda De Vera vs. Court of Appeals
G.R. No. 97761, April 14, 1999
Contributor: Tomol, Angelo Gabriel M.
Doctrine: Possession in Good Faith
Question:

Private Respondent XX was able to obtain a Homestead Patent for 100 square meters of land
during the 1950’s. After the issuance of his Homestead Patent, XX brought a complaint for
recovery of possession against several people for ejectment. Whilst the cases were pending, AA
occupied 20 square meters of XX’s land by virtue of a Miscellaneous Sales Application.

In 1981, XX wrote to AA reminding them that their house is on his titled property, and asking them
to buy the portion occupied by them or to lease the same on a yearly or monthly basis; otherwise,
XX would be constrained to take proper legal action against them. The letters were ignored by
AA, and instead he built a house on the property 3 years after receiving the letter.

AA contends that he ignored the letters because he was a possessor in good faith as he honestly
believed that the part of the land with an area of 20 square meters is covered by the Miscellaneous
Sales Application.

Is AA’s contention correct?

SUGGESTED ANSWER:

NO, because AA is a possessor in bad faith.

Article 526 of the New Civil Code provides that, He is deemed a possessor in good faith who is
not aware that there exists in his title or mode of acquisition any flaw which invalidates it. He is
deemed a possessor in bad faith who possesses in any case contrary to the foregoing.

In this case, when AA received the letter he already had knowledge that there was a flaw in his
possession of the land; instead of acting to cure the defect, he built a house. Hence, AA cannot
be considered a possessor in good faith.
 SPOUSES DARIO LACAP and MATILDE LACAP vs. JOUVET ONG LEE
G.R. No. 142131, December 11, 2002
Contributor : Vilbar, Jairus Adrian D.

DOCTRINE: Possession in Good Faith

Question:

Before 1981, Mr. Juan Dela Cruz mortgaged two parcels of land and the improvements thereon
to Carbon Bank. In the same year, spouses Jose and Maria assumed to pay Juan’s mortgage
obligation to the bank. Due to their failure to pay their obligation to the bank, they foreclosed on
the mortgage. During the auction sale, the bank emerged as the highest bidder and title passed
on to it.

The bank allowed the petitioner spouses to stay in the premises as lessees paying a monthly
rental. Jose and Maria introduced improvements after relying on the bank's assurance that the
property would be sold back to them. When they went to the bank to pay the monthly rentals, the
bank refused to accept the payments and told them that the property had already been sold to
another person. Jose and Maria made an offer but the bank turned them down.

Jose insisted that they are possessors in good faith not just mere lessees and contested that they
are entitled to a full reimbursement for all of the improvements that were introduced to the subject
property.

Is the contention of Jose correct?

SUGGESTED ANSWER:

No, Jose is incorrect because they are just mere lessees and not possessors in good faith.

Article 528 of the Civil Code provides that possession in good faith continues to subsist until facts
exist which show that the possessor is already aware that he wrongfully possesses the thing. In
the given case, possession in good faith ceased to exist when they acknowledged that they were
mere lessees by paying monthly rentals which also admitted the validity of the title of their
landlord. Since they are just mere lessees, we apply Art. 1678 which states that if the lessee
makes, in good faith, useful improvements which are suitable to the use for which the lease is
intended, without altering the form or substance of the property leased, the lessor upon the
termination of the lease shall pay the lessee one-half of the value of the improvements at that
time. Jose and Maria are entitled to be paid only one-half of the value of the useful improvements
at the time of the termination of the lease.

Therefore, Jose’s contention is incorrect.

 CIR vs. SOLIDBANK CORP.,
G.R. No. 148191, November 25, 2003;
Contributor: Abangan, Shaira Cristy F.

DOCTRINE: Actual and Constructive Possession

Question:

X filed its Quarterly Percentage Tax Returns which includes in the computation of the gross
receipts those passive income already subjected to 20% final withholding tax (FWT). He asked
for refund from BIR contending that passive income which is subject to FWT should not form part
of gross receipts for the computation of percentage tax. Since there is no actual receipt, the FWT
is not to be included.

Is X correct that actual receipt is required to acquire possession to be subjected to tax?

SUGGESTED ANSWER:

No. X is not correct.

The rules on actual and constructive possession provided in Articles 531 and 532 of New Civil
Code can be applied by analogy to the receipt of income. Under Article 531, possession is
acquired by the material occupation of a thing or the exercise of a right, or by the fact that it is
subject to the action of our will, or by the proper acts and legal formalities established for acquiring
such right. Moreover, Article 532 states that possession may be acquired by the same person
who is to enjoy it, by his legal representative, by his agent, or by any person without any power
whatever; but in the last case, the possession shall not be considered as acquired until the person
in whose name the act of possession was executed has ratified the same, without prejudice to
the juridical consequences of negotiorum gestio in a proper case.

Here, there is acquisition of the right of possession through the proper acts and legal formalities
established which is the withholding process. There being constructive receipt, part of which is
withheld, that income is included as part of the tax base on which the gross receipts tax is
imposed.
 Republic vs David
GR 155634
By: Chatch L. Calderon

BAR Q:

SSS awarded X, an employee of SSS, with a house and lot pursuant to its Employees’ Housing
Loan Program. A Deed of Conditional Sale was then executed between the parties. Upon report
of numerous violations in connection with these sales, the SSS conducted an investigation and
found that X committed two violations of his deed of conditional sale because (1) neither he nor
his immediate family resided/occupied said housing unit, and (2) he allowed a certain Y to possess
and occupy such property. X alleged that Y was only a caretaker and possession was still with Y.
Can “actual possession” be equated with “actual occupancy” which is the condition of the said
sale?

Answer:

No, actual possession is not the same as actual occupancy.

According to Art. 531 of the Civil Code, possession is acquired by the material occupation of a
thing or the exercise of a right xxx. As such, actual possession consists in the manifestation of
acts of dominion over property of such nature as a party would naturally exercise over his own.
Possession can be either “actual” or merely constructive. On the other hand, actual occupancy
connotes “something real, or actually existing, as opposed to something merely possible”.

In the case at hand, it is uncontroverted that X and/or his immediate family did not “actually
occupy” the said residence and allowed other persons to benefit from its use. The fact that Y and
his wife lived in the said property for a long time means that it was Y and not X who has actually
occupied said property. Because of such, X then did not satisfy the condition of “actual occupancy”
because they did not occupy said property.
 COMMISSIONER OF INTERNAL REVENUE VS. SOLIDBANK CORP.
G.R. NO. 148191, NOVEMBER 25, 2003
Contributor : Adolfo, Dawn Maryam C.

DOCTRINE: Possession

Question:

Bank XYZ filed its Quarterly Percentage Tax Returns reflecting gross receipts in the total amount
of 1,474,691,693.44, which includes the sum of 350,807,875.15 representing gross receipts from
passive income that was already subjected to a 20% final withholding tax (FWT). Bank XYZ filed
with the BIR a letter-request for the refund or issuance of tax credit certificate in the amount of
3,508,078.75 based on a decision in CTA holding that the 20% final withholding tax on a bank’s
interest income should not form part of its taxable gross receipts for purposes of computing the
gross receipts tax. The CTA ordered CIR to refund Bank XYZ the amount of ₱1,555,749.65. CA
held that the 20% FWT on a bank’s interest income did not form part of the taxable gross receipts
in computing the 5% GRT because the FWT was not actually received by the bank but was directly
remitted to the government. CIR contends that there is constructive receipt of the interest on
deposits and yield on deposit substitutes. Bank XYZ claims that given that the amount had already
been withheld at source, it did not have actual receipt thereof.

Rule on the parties’ contentions.

SUGGESTED ANSWER:

CIR is correct in contending that there is actual receipt.

Article 531 of the Civil Code provides that "Possession is acquired by the material occupation of
a thing or the exercise of a right, or by the fact that it is subject to the action of our will, or by the
proper acts and legal formalities established for acquiring such right". Furthermore, Article 532
states that "Possession may be acquired by the same person who is to enjoy it, by his legal
representative, by his agent, or by any person without any power whatever; but in the last case,
the possession shall not be considered as acquired until the person in whose name the act of
possession was executed has ratified the same, without prejudice to the juridical consequences
of negotiorum gestio in a proper case."

In this case, the possession is acquired by the payor as the withholding agent of the government
because the taxpayer ratifies the very act of possession for the government. Thus, there is
constructive receipt. The processes of bookkeeping and accounting for interest on deposits and
yield on deposit substitutes that are subjected to FWT are tantamount to delivery, receipt, or
remittance.
 JOSE C. LEE and ALMA AGGABAO vs RTC OF QUEZON CITY BRANCH 85
GR No. 146006 February 23, 2004
Contributor: Aliman, Marie Dess B.

Question:

During the pendency of the settlement of the estate of Dr. Ortañez, Juliana and her son, Jose
entered into a memorandum of agreement for the extrajudicial settlement of the estate and
partitioning the estate including the Philinterlife shares among themselves.

Juliana sold 1,014 Philinterlife shares of stock in favor of petitioner FLAG without the approval of
the intestate court. Subsequently, Jose later sold the remaining 1,011 shares also in favor of
FLAG without the approval of the intestate court.

Is court approval necessary for the validity of any disposition of the decedent’s estate?

SUGGESTED ANSWER:

Yes. It is clear that Juliana and her sons invalidly entered into a memorandum of agreement
extrajudicially partitioning the intestate estate among themselves, despite their knowledge that
there were other claimants to the estate and before final settlement of the estate by the intestate
court. Since the appropriation of the state was invalid, the subsequent sale thereof to a third party,
without court approval, was likewise void.

An heir can sell his right, interest, or participation in the property under administration under Article
533 of the Civil Code which provides that possession of hereditary property is deemed transmitted
to the heir without interruption from the moment of death of the decedent. However, an heir can
only alienate such portion of the estate that may be allotted to him in the division of the estate by
the probate or intestate court after final adjudication, that is, after all debtors have been given their
shares. This means that an heir may only sell his ideal or undivided share in the estate, not any
specific property therein.

Julian and Jose sold specific properties (shares of stocks) in favor of FLAG. This they could not
lawfully do pending the final adjudication of estate by the intestate court because of undue to the
prejudice it would cause the other claimants to the estate. It being settled that property under
administration needs the approval of the probate court before it can be disposed of, any
unauthorized disposition does not bind the estate and is null and void.

As early as 1921 in the case of Godoy vs Orellano, the Court laid down the rule that the sale of
the property of the deceased which is not authorized by the probate court is null and void and
does not pass title to the purchaser.
 FERNANDA MENDOZA CEQUENA and RUPERTA MENDOZA LIRIO, vs. HONORATA
MENDOZA BOLANTE
G. R. No. 137944. April 6, 2000
Contributor: Bolano, Joanne T

DOCTRINE:

Tax receipts and declarations are prima facie proofs of ownership or possession of the property
for which such taxes have been paid. Coupled with proof of actual possession of the property,
they may become the basis of a claim for ownership. By acquisitive prescription, possession in
the concept of owner — public, adverse, peaceful and uninterrupted — may be converted to
ownership. On the other hand, mere possession and occupation of land cannot ripen into
ownership.

A parcel of land was declared under the name Sinforoso for tax purposes in 1930 until 1954. In
1954, his brother Margarito declared the same parcel of land under his name.

The family of Sinforoso, his wife and only daughter (Honorata) continued to live therein as they
make adverse claim on the property while Margarito tilled the land with his son.

When Honorata came of age in 1948, she paid realty tax for the years 1932-1948. Margarito on
the other hand paid realty taxes beginning 1952.When Margarito died, his son continued tilling
the land while Honorata continued living therein until she ousted him in 1985.

Who has a better right in the disputed parcel of land?

Suggested Answer:

Honorata has the better right in the concept of an owner.

Ownership of immovable property is acquired by ordinary prescription through possession for

ten years. Being the sole heir of her father, respondent showed through his tax receipt that she
had been in possession of the land for more than ten years since 1932. When her father died in
1930, she continued to reside there with her mother. When she got married, she and her
husband engaged in kaingin inside the disputed lot for their livelihood.

Based on Article 538 of the Civil Code, the respondent is the preferred possessor because,
benefiting from her father’s tax declaration of the subject lot since 1926, she has been in
possession thereof for a longer period. On the other hand, petitioners’ father acquired joint
possession only in 1952.

Respondent’s possession was not disturbed until 1953 when the petitioners’ father claimed the
land. But by then, her possession, which was in the concept of owner — public, peaceful, and
uninterrupted — had already ripened into ownership. Furthermore she herself, after her father’s
demise, declared and paid realty taxes for the disputed land. Tax receipts and declarations of
ownership for taxation, when coupled with proof of actual possession of the property, can be the
basis of a claim for ownership through prescription.

In contrast, the petitioners, despite thirty-two years of farming the subject land, did not acquire
ownership. It is settled that ownership cannot be acquired by mere occupation. Unless coupled
with the element of hostility toward the true owner, occupation and use, however long, will not
confer title by prescription or adverse possession. Moreover, the petitioners cannot claim that
their possession was public, peaceful and uninterrupted. Although their father and brother
arguably acquired ownership through extraordinary prescription because of their adverse
possession for thirty-two years (1953-1985), this supposed ownership cannot extend to the
entire disputed lot, but must be limited to the portion that they actually farmed.

Tax declarations and receipts are not conclusive evidence of ownership. At most, they
constitute mere prima facie proof of ownership or possession of the property for which taxes
have been paid. In the absence of actual public and adverse possession, the declaration of the
land for tax purposes does not prove ownership. In sum, the petitioners’ claim of ownership of
the whole parcel has no legal basis.
 PHILIPPINE TRUST CO. VS COURT OF APPEALS
G.R. NO. 124658, DECEMBER 15, 1999
Contributor : Abella, Allain Jon Carlo A.

DOCTRINE: Every possessor has a right to be respected in his possession; and should he be
disturbed therein, he shall be restored to said possession by the means established by the laws
and rules of court

Question:

X mortgaged a property to ABC bank to secure his loan. Upon failure of X to pay the loan as it fell
due, the mortgage was foreclosed. Despite foreclosure, X was allowed by ABC to occupy and
repurchase the lot on negotiated terms. On a later date, X filed a claim for damages against Y,
claiming that Y entered the property through trickery and fraudulent machination, and took
possession of the property. Y filed a motion to dismiss for failure to state a cause of action,
granting X is no longer the owner of such property. Decide.

Suggested Answer:

Motion to dismiss should be denied.

As decided by the court in the case of Philippine Trust Co. vs CA, it is incorrect to say that
petitioners have no cause of action just because it is no longer the owner of such property, A
lawful possessor of a thing has the right to institute an action for having been disturbed in its
enjoyment.

In the case at bar, X, although no longer the owner, is in lawful possession of the property in
question. He enjoys the right not to be disturbed in the possession of the property. He may file an
action which would defend his right to the enjoyment of such.

Therefore, Y cannot have the claims of X dismissed for he has a cause of action in defending his
rights.
 Fernanda Mendoza Cequena vs. Honorata Mendoza Bolante
G.R. No. 137944, April 6, 2000;
Contributor: Edullantes, Surmita Zoe F.

Doctrine: Tax declarations and receipts are not conclusive evidence of ownership. At most,
they constitute mere prima facie proof of ownership or possession of the property for which
taxes have been paid. By acquisitive prescription, possession in the concept of owner — public,
adverse, peaceful and uninterrupted — may be converted to ownership. On the other hand,
mere possession and occupation of land cannot ripen into ownership.

Question:

Prior to 1954, the father of AA, Mr. X, who was the current owner of the land originally declared a
parcel of land in the Province of Rizal for taxes purposes. The said tax declaration was then
canceled and filed under the name of Mr. Y, Mr. X's brother and the father of BB. During the
cadastral survey of the property, AA and CC, the son of Mr. Y, argued over who should own the
land. The trial court determined that BB and his siblings are the rightful owner and holder of the
land in response to a petition for a declaration of title. AA appealed the decision to the Court of
Appeals because she was upset with the outcome and claimed that she had been in actual and
physical possession of the property since 1985, along with exclusive and continuous possession,
which is proof of the best kind of circumstance proving the claim of title of ownership and enjoys
the presumption of preferred possessor. However, BB and his siblings asserted that they have a
superior claim, which is supported by a number of tax declarations and receipts in one of their
siblings' names.
Decide who has the better right of ownership and possession of the disputed land.

Suggested Answer:

I will decide in AA’s favor.

According to Article 538 of the Civil Code, the present possessor shall be preferred; if there are
two possessors, the one longer in possession.

AA is the preferred possessor because she has had possession of the subject lot for a longer
time due to her father's tax declaration of it since 1926. However, BB’s father didn't get joint
possession until 1952. Ordinary prescription grants ownership of immovable property after ten
years of possession. As her father's sole heir, AA demonstrated through his tax receipt that she
had been in possession of the land for more than ten years, dating back to 1932. When her
father died in 1930, she remained in the house with her mother. When she married, she and her
husband made a living by kaingin within the disputed lot. AA’s possession was not challenged
until 1953, when the land was claimed by the BB’s father, Mr. Y. But by that time, AA’s
possession, which was in the concept of owner — public, peaceful, and uninterrupted — had
already matured into ownership. Furthermore, following her father's death, she declared and
paid realty taxes on the disputed land. Tax receipts and declarations of ownership for taxation,
when combined with proof of actual possession of the property, can form the basis of a
prescription claim for ownership.

Tax declarations and receipts, however, are not conclusive evidence of ownership. They are, at
best, prima facie evidence of ownership or possession of the property for which taxes have
been paid. The declaration of the land for tax purposes does not prove ownership in the
absence of actual public and adverse possession. Thus, the BB’s claim to ownership of the
entire parcel lacks legal support.
 BPI FAMILY BANK vs. AMADO FRANCO and COURT OF APPEALS
G.R. No. 123498, November 23, 2007
Contributor: Flores, Rosemarie Cris C.

DOCTRINE: The quality of being fungible depends upon the possibility of the property, because
of its nature or the will of the parties, being substituted by others of the same kind, not having a
distinct individuality.

QUESTION:
Letecia Mondragon opened specific accounts in a XYZ Bank namely: current, savings and
time deposit. The current and savings accounts were funded with an initial deposit of Php
500,000.00 each while the time deposit account was funded with Php 1,000,000.00 that will
mature on August 31, 2032. The total amount of P2 Million used to open the said accounts was
traceable to a check issued by ABC Corporation in consideration of Ms. Mondragon’s introduction
to Eddie Navarro, who was looking for a conduit bank to manage ABC Corporation’s business
transactions, to Josephine Uy, who was then the XYZ Bank’s Branch Manager. Consequently,
the funding for the P2 Million check was part of the P80 Million debited by the XYZ Bank from
FAM Investment’s time deposit account and credited to ABC Corporation’s current account
pursuant to an Authority to Debit signed by FAM Investment’s officers. It appears that the
signatures of FAM Investment’s officers on the Authority to Debit were forged. However, ABC
Corporation had already made several withdrawals from its current account, including the P2
Million paid to Ms. Mondragon. To protect the interests of FAM Invesment’s forgery claim, the
Bank instructed the Bank Manager to debit Ms. Mondragon’s savings and current accounts for
the amounts remaining therein. As a result, two checks drawn by Ms. Mondragon against her
current account were dishonored upon presentment for payment and stamped with a notion
“account under garnishment”.

Does Ms. Mondragon had a better right to the deposits which were part of the proceeds of a
forged Authority to Debit?

SUGGESTED ANSWER:
Yes, Ms Mondragon has a better right to the deposits.

Art. 559 of the Civil Code pertains to a specific or determinate thing. A determinate or
specific thing is one that is individualized and can be identified or distinguished from others of the
same kind.

In the present case, the deposits in Ms. Mondragon’s accounts consist of money which is
characterized as movable, generic and fungible. The quality of being fungible depends upon the
possibility of the property, because of its nature or the will of the parties, being substituted by
others of the same kind, not having a distinct individuality. The deposit of money in banks is
governed by the Civil Code regarded as a simple loan or mutuum. There is a debtor-creditor
relationship between the bank and its depositor. Although the bank has acquired ownership of
Ms. Mondragon’s deposits, such ownership is coupled with a corresponding obligation to pay her
an equal amount on demand.

Hence, Ms. Mondragon has a better right to the deposits. That is, when Ms. Mondragon
issued checks drawn against her current account; she has every right as a creditor to expect that
those checks would be honored by the bank being a debtor.
Articles 484-773
 Edilberto Alcantara, et al., v. Cornelio B. Reta, Jr.
G.R. No. 136996, December 14, 2001
Contributor: Alvarez, Camela Hope G.

Doctrine: Construction of a house on the lot of another in order to facilitate the use of a usufruct
is in the nature of a personal easement under Article 614 of the Civil Code.

Question:

Cornelio allowed Berto to use 62 coconut trees from his land for 186 pesos each from where the
latter can gather tuba. In order to facilitate Berto’s gathering of tuba, Cornelio allowed the former
to construct his house on his land. A few years later, Berto filed a complaint against Cornelio for
the exercise of the right of first refusal under PD 1517. For such right of refusal to be applicable,
the person claiming the right must be a legitimate tenant of the land for 10 years or more, he must
have built his home on the land by contract, and has resided thereon continuously for the last 10
years. The RTC dismissed Berto’s complaint on the ground that the requisites for the right of
refusal under PD 1517 were not satisfied since he is not a legitimate tenant of the land. Is the
RTC correct in dismissing the complaint?

Suggested Answer:

Yes, the RTC is correct. The right of refusal under PD 1517 is not applicable since Berto does not
use the land as a tenant under a lease, but under a personal easement.

It is provided under Article 614 of the Civil Code that servitudes or easements may also be
established for the benefit of a community, or of one or more persons to whom the encumbered
estate does not belong.

In this case, the arrangement of allowing Berto to use the coconut trees to gather tuba is a usufruct
and not a lease. Consequently, Berto was allowed to construct his house on the land for his
benefit, which is to facilitate his gathering of tuba. Such arrangement is in the nature of a personal
easement under Article 614 of the Civil Code.

Since Berto was using Cornelio’s land under a personal easement, he is not considered as a
legitimate tenant of the land. Thus, the right of refusal under PD 1517 is not applicable.
 Bryan U. Villanueva vs. Tirso D.C. Velasco,
G.R. No. 130845, Nov. 27, 2000;
Amistad, Alyssa Kirsten V.

Question:

X bought land from Pacific Banking Corporation. The bank acquired it from the spouses A and B
at a public auction. When X bought the property, there was a small house on its southern part. It
occupied one meter of the two meter wide easement of right of way A and B granted to Z, in a
contract of easement of right of way. In a separate civil case, the court issued a writ of preliminary
injunction ordering A and B to provide the right of way and to demolish the small house
encroaching the easement. All unknown to X, hence, he filed for a petition for certiorari asserting
that the contract of easement executed by A and B in favor of Z could not be enforced against
him since he is not a party to the case and it was not annotated in the title. Will the petition
prosper?

Suggested answer:

No, X was bound by the contract of easement, not only as a voluntary easement but as a legal
easement.

A legal easement is mandated by law, and continues to exist unless its removal is provided for in
a title of conveyance or the sign of the easement is removed before the execution of the
conveyance conformably with Article 649. Also, a servitude like a right of way can exist even if
they are not expressly stated or annotated as an encumbrance in a Torrens title because
servitudes are inseparable from the estates to which they actively or passively belong, as provided
for in said Article 617 of the Civil Code.

At the outset, the subject easement right of way, originally was voluntarily constituted by an
agreement between A and B to Z. But as correctly observed, the easement in the instant petition
is both (1) an easement by grant or a voluntary easement, and (2) an easement by necessity or
a legal easement. A legal easement is one mandated by law, constituted for public use or for
private interest, and becomes a continuing property right. Moreover, a decision in a case is
conclusive and binding upon the parties to said case and those who are their successor in interest
by title after said case has been commenced or filed in court.

Therefore, X’s contention is unmeritorious.

 National Irrigation Administration vs. Court of Appeals and Dick Manglapus
G.R. No. 114348, September 20, 2000
Contributor: Kimberly Lourdes Tina Amper

Doctrine: Doctrine of Transferee or Buyer in Good faith

Question: A free patent over three (3) hectares of land, situated in barrio Baybayog was granted
to Vicente registered under Original Certificate of Title No. P-24814. The OCT contains provision
such as, “a reservation and condition that the land is subject to "to all conditions and public
easements and servitudes recognized and prescribed by law especially those mentioned in
Sections 109, 110, 111, 112, 113 and 114, Commonwealth Act No. 141, as amended."

Subsequently, Dick acquired the lot from Vicente by absolute sale. Sometime in 1982, National
Irrigation Administration (NIA) entered into a contract where they have to create canals. NIA then
entered a portion of Dick’s land and made diggings and fillings thereon and constructed an eleven
(11) meters in width canal. Now, Dick filed a case in court asking for just compensation for the
taking of a portion of his property for use as easement of a right of way under Section 112,
Commonwealth Act No. 141.

Section 112, Commonwealth Act No. 141, provides that lands granted by patent, "shall further be
subject to a right of way not exceeding twenty meters in width for public highways, railroads,
irrigation ditches, aqueducts, telegraphs and telephone lines, and similar works as the
Government or any public or quasi-public service or enterprises xxx”. Can Dick ask for just
compensation?

Suggested Answer
No. Dick is not entitled to just compensation for the taking of a portion of his property.

Article 619 of the Civil Code provides that, "Easements are established either by law or by
the will of the owners. The former are called legal and the latter voluntary easements."

In the case at hand, reservation of easements of patented lands are established in

Commonwealth Act No. 141. Vicente’s land being a patent and previously a public land, it is
subject to such law. Section 112 of C.A. 141 cannot apply in this instance since the canal created
is less than 20 meters in width.

Neither can Dick argue that he was a transferee or buyer in good faith. Under the Torrens
system, for one to be a buyer in good faith and for value, the vendee must see the transfer
certificate of title and rely upon the same. Failure to refer to the conditions annotated on the back
of the original equates that he is a transferee with notice of the liens annotated in the title. Hence,
not just compensation.
 NATIONAL POWER CORPORATION vs. SPS. JOSE C. CAMPOS, JR. and MA. CLARA
LOPEZ-CAMPOS
G.R. No. 143643 ; June 27, 2003
Contributor: ARAB, Alaniah B.

QUESTION: On 1970, XYZ Electric Co., through its representative Jose, verbally asked Juan to
let the electric company be given a right of way over Juan’s property. Juan agreed on the request
upon the condition that the installation would be temporary. XYZ assured the respondents that
the arrangement would be temporary and that the wooden electric posts would be relocated as
soon as permanent posts and transmission lines shall have been installed. Thereafter, XYZ
continued to use the subject property for its wooden electrical posts and transmission lines without
compensating Juan therefor.

On 1994, XYZ’s agents entered the subject property for engineering survey in connection with
XYZ’s plan to erect an all-steel transmission line tower on a 24-square meter area inside the
subject property. Juan refused to grant permission and asked to talk to the chief of XYZ, but
response was not heard of. Instead, XYZ contends that they are now the owner of the subject
property because it had already acquired the easement of right-of-way over the portion of the
subject property by prescription, the said easement having been allegedly continuous and
apparent for a period of about twenty-three (23) years. They invoke Article 620 of the Civil Code
which states that continuous and apparent easements are acquired either by virtue of a title or by
prescription of ten years.

Did XYZ Electric Co. acquire the property through prescription by virtue of Article 620 of the Civil
Code?

SUGGESTED ANSWER: No, XYZ did not acquire the property by prescription.

Article 620 of the Civil Code provides that- Continuous and apparent easements are
acquired either by virtue of a title or by prescription of ten years.

Prescription as a mode of acquisition requires the existence of the following: (1) capacity to
acquire by prescription; (2) a thing capable of acquisition by prescription; (3) possession of the
thing under certain conditions; and (4) lapse of time provided by law. Acquisitive prescription may
either be ordinary, in which case the possession must be in good faith and with just title, or
extraordinary, in which case there is neither good faith nor just title. In either case, there has to
be possession which must be in the concept of an owner, public, peaceful and uninterrupted. As
a corollary, Article 1119 of the Civil Code provides that- Acts of possessory character
executed in virtue of license or by mere tolerance of the owner shall not be available for
the purposes of possession.

In the case at bar, XYZ’s possession of that portion of the subject property where it erected the
wooden posts and transmission lines was merely upon the tolerance of the Juan. Accordingly,
this permissive use by XYZ of that portion of the subject property, no matter how long continued,
will not create an easement of right-of-way by prescription.
XYZ’s claim that it had acquired the easement of right-of-way by prescription must fail. As
intimated above, possession is the fundamental basis of prescription, whether ordinary or
extraordinary. XYZ never acquired the requisite possession in this case. Its use of that portion of
the subject property where it erected the wooden poles and transmission lines was due merely to
the tacit license and tolerance of the respondents. As such, it cannot be made the basis of the
acquisition of an easement of right-of-way by prescription.
 Bogo-Medellin Milling Co. vs. Court of Appeals,
G.R. No. 124699, July 31, 2003;
Badal, Lea Faye

Doctrine: An easement is continuous if its use is, or may be, incessant without the intervention
of any act of man, like the easement of drainage; and it is discontinuous if it is used at intervals
and depends on the act of man, like the easement of right of way.

Question: Don Juan purchased an unregistered parcel of land from Señora. The land was
possessed by Don Juan who also paid taxes thereon. Señorito, the son of Don Juan, inherited
the unregistered parcel of land. However, unknown to Señorito, the Vodoo-Milling Corp. was able
to obtain title to Lot No. 954, the narrow lot where the railroad tracks lay, was claimed by the
corporation as its own and was declared for tax purposes in its name. Señorito, through his lawyer,
demands for payment of compensation for the use of the land. Thereafter, Señorito filed a
"Complaint for Payment of Compensation and/or Recovery of Possession of Real Property and
Damages with Application for Restraining Order/Preliminary Injunction" against VodoMi Corp.
VodoMi Corp. in its defense that it was the owner and possessor of the land having allegedly
bought it from Señora, prior to the sale of the property by the latter from Don Juan. Moreover,
VodoMi Corp. contends that they acquired ownership of the easement through prescription. Is the
contention of VodoMi Corporation meritorious?

Suggested Answer:

No, the contention of VodoMi Corp. is without merit. In the case of BOMEDCO vs Valdez, the
Supreme Court ruled that petitioner Bomedco never acquired any title over the use of the railroad
right of way whether by law, donation, testamentary succession or contract. Its use of the right of
way, however long, never resulted in its acquisition of the easement because, under Article 622,
the discontinuous easement of a railroad right of way can only be acquired by title and not by
prescription.

As discussed by the Higher court, under Article 620 of the Civil Code: continuous and apparent
easements are acquired either by virtue of a title or by prescription of ten years. Easements are
either continuous or discontinuous according to the manner they are exercised, not according to
the presence of apparent signs or physical indications of the existence of such easements. Thus,
an easement is continuous if its use is, or may be, incessant without the intervention of any act of
man, like the easement of drainage; and it is discontinuous if it is used at intervals and depends
on the act of man, like the easement of right of way.

The easement of right of way is considered discontinuous because it is exercised only if a person
passes or sets foot on somebody else’s land. Like a road for the passage of vehicles or persons,
an easement of right of way of railroad tracks is discontinuous because the right is exercised only
if and when a train operated by a person passes over another's property. In other words, the very
exercise of the servitude depends upon the act or intervention of man which is the very essence
of discontinuous easements.

In the case at bar, the presence of railroad tracks for the passage of VodoMi’s Corp trains denotes
the existence of an apparent but discontinuous easement of right of way.
 Sps. Manuel and Rosalinda Mejorada vs. Glorificacion Vertudazo
G.R. No. 151797 ; Ocotber 11, 2007
Contributor: Yntig, Krista May D.

Doctrine: Easement of right of way on a property surrounded by other immovable property.

Question: A’s residential property was landlocked being bordered on all sides by different lots. As
an access route going to Quinones Street and the public highway, he utilized a proposed
undeveloped barangay road on the south side of his property owned by B. The utilized property
measures 55.5 square meters that serves as an adequate outlet to Quinones Street which for
several years, A and the general public have been using as a passageway to and from Quinones
Street.

Later on, B closed the passageway by building a new garage for his service jeep. A offered to pay
for the indemnity of the easement, however, B claimed that there is an alternate route which A
has been using although it was long, circuitous and muddy. A filed a complaint praying for a grant
of easement of right of way over B’s property. Is A entitled to the easement of the right of way on
B’s property?

Suggested Answer: Yes, A is entitled to the easement of the right of way on B’s property.

Articles 649 and 650 of the Civil Code provide:

Art. 649. The owner, or any person who by virtue of a real right may cultivate or use any
immovable, which is surrounded by other immovables pertaining to other persons and
without adequate outlet to a public highway, is entitled to demand a right of way through
the neighboring estates, after payment of the proper indemnity.

Art. 650. The easement of right of way shall be established at the point least prejudicial to
the servient estate, and, insofar as consistent with this rule, where the distance from the
dominant estate to a public highway may be the shortest.

In this case, A has satisfied the requisites for the easement of right of way. First, there is no other
road which A could use leading to Quiñones Street except the passageway on B’s property.
Second, A has offered to pay B proper indemnity for the easement of way. Third, The isolation of
A’s property was not due to his acts. Lastly, the easement is at the point least prejudicial to B’s
property since the 55.5 square meters is located at the corner of petitioners’ landholding, hence,
does not cause them inconvenience in anyway.

Therefore, A is entitled to the easement of the right of way on B’s property.

 Woodbridge School, Inc., et al. vs. ARB Construction Co., Inc.,
G.R. No. 157285, February 16, 2007;
Amanense, Bryan

DOCTRINE: Legal easement of right of way is an easement which has been imposed by law and
not by the parties and it has for its object either public use or the interest of private persons.

BAR EXAM QUESTION: Woodbridge School and Miguela are the usufructuary and the naked
owner, respectively, of a parcel of land situated in the middle of the 4-phases of Soldiers Hills
Subdivision owned by ARB Construction Co. The said parcel of land is enclosed by other estates
without any adequate access to a public highway, except the subdivision road within the Soldiers
Hills Subdivision Phase 4 which leads to the public highway. ARB fenced the perimeter of the
subdivision road which effectively cut off Woodridge and Miguela’s access to and from the public
highway. After failing to settle amicably, Woodridge and Miguela jointly filed a complaint in the
RTC to enjoin ARB from depriving them of the use of the disputed subdivision road and to seek
a compulsory right of way after payment of proper indemnity.

Petitioners Woodridge and Miguela argued that the contested subdivision road is a property of
public dominion that can be used by the general public without need for compensation. Therefore,
it is wrong for respondent ARB to exclude petitioners from using the said subdivision road or to
make them pay for the use of the same.

On the other hand, respondent ARB argued that, generally, the road lots in a private subdivision
are private property and the use of the subdivision roads by the general public does not strip it of
its private character. The road is not converted into public property by mere tolerance of the
subdivision owner of the public's passage through it. Therefore, ARB may readily exclude
petitioners from passing through its subdivision road.

Suppose the value of the land occupied plus the amount of the damage caused to the contested
subdivision road is P1-Million.

Is respondent ARB’s contention tenable?

SUGGESTED ANSWER: No. Respondent ARB’s contention is untenable. Although the

contested subdivision road is privately owned by respondent, however, the circumstances show
a case of legal easement of right of way for the petitioners.

Jurisprudence dictates that to be entitled to a legal easement of right of way, the following
requisites must concur:

(1) the dominant estate is surrounded by other immovables and has no adequate outlet to a public
highway;

(2) payment of proper indemnity which is the sum of the value of the land occupied plus the
amount of the damage caused to the servient estate;
(3) the isolation was not due to acts of the proprietor of the dominant estate; and

(4) the right of way claimed is at the point least prejudicial to the servient estate.

In the case at bar, the dominant estate here is the petitioners’ parcel of land situated in the middle
of the four phases of Soldiers Hills Subdivision owned by the respondent and is enclosed by other
estates without any adequate access to a public highway, except the subdivision road within the
Soldiers Hills Subdivision Phase 4, which is the servient estate. Due to the act of respondent of
fencing the perimeter of the subdivision road, petitioners’ access to and from the public highway
is effectively cut-off. Petitioners must pay P1-Millition to respondent as proper indemnity which is
equivalent to the value of the land occupied plus the amount of the damage caused to the
contested subdivision road of respondent. Therefore, a legal easement of right of way has to be
properly established in this case.
 Ma. Linda T. Almendras vs. Court of Appeals,
GR No. 110067, Aug. 3, 1998
Contributor: Durato, Germe Noah

Topic: Easement

Doctrine: Where the easement may be established on any of several tenements surrounding the
dominant estate, the one where the way is shortest and will cause the least damage should be
chosen. However, . . . if these two (2) circumstances do not concur in a single tenement, the way
which will cause the least damage should be used, even if it will not be the shortest.

Question: John Arthur bought a new property which is situated in the middle of properties owned
by different people. North of his property is owned by an accountant named Juan Kaon, South of
it is the property of Chielou Dagan, to the East is the property owned by Erica Tulog, and West is
owned by Jessica Baktas. The property initially on its Western boundary has an access to an
existing private road, 6 meters wide, which passes through the lots of Jessica Baktas, Champo
Hinay, Sarah Paspas, Melanie Ligid and Jennie Ambak and leads to another private road located
on the property of Benjie Tuktok which in turn connects to the provincial road.

However, when he went to the property, he discovered that it is already inaccessible to the public
road as Jessica Baktas erected a fence on her lot, so he filed a petition for the establishment of
right of way which will be constituted through the property of Juan Kaon, on the northern side of
his property with the basis that it is the shortest route to the provincial road.

How would you rule on Arthur’s petition?

Suggested Answer:

I will rule against the petition of Arthur for the establishment of right of way on the northern side
of his property which is owned by Juan Kaon.

Jurisprudence dictates that where the easement may be established on any of several tenements
surrounding the dominant estate, the one where the way is shortest and will cause the least
damage should be chosen. However, . . . if these two (2) circumstances do not concur in a single
tenement, the way which will cause the least damage should be used, even if it will not be the
shortest.

In the case at hand, there was a previous access already to the public road on the western part
of Arthur’s property before Jessica Baktas erected a fence without permission from the trial court.
Although the northern part is the property that will provide Arthur the shortest access to the public
road, it cannot be fully determined whether the northern part is the point least prejudicial to the
owners of the servient estates without comparative evaluation of the physical conditions of the
estates. In fact, it is impossible to determine with certainty which estate would be least prejudiced
by the establishment of an easement for the petitioner (Arthur) until all these parties have been
heard.

Hence, in order that all parties may be held liable to bear the easement and make it binding among
them, they all should first be a party to the action and be given the opportunity to be heard for the
determination of the correct access that is least prejudicial.
 Anastacia Quimen vs. Court of Appeals
G.R. No. 112331; May 29, 1996
Ursal, Regino

Doctrine:

When the easement may be established on any of several tenements surrounding the dominant
estate, the one where the way is shortest and will cause the least damage should be chosen.
However, as elsewhere stated, if these two (2) circumstances do not concur in a single tenement,
the way which will cause the least damage should be used, even if it will not be the shortest.

Question:

In 2005, Andres built a residential house on a lot whose only access to the national highway was
a pathway crossing Brando's property. Andres and others have been using this pathway (pathway
A) since 1980.

In 2006, Brand0 fenced off his property, thereby blocking Andres' access to the national highway.
Andres demanded that part of the fence be removed to maintain his old access route to the
highway (pathway A), but Brando refused, claiming that there was another available pathway
(pathway B) for ingress and egress to the highway. Andres countered that pathway B has defects,
is circuitous, and is extremely inconvenient to use.

To settle their dispute, Andres and Brando hired Damian, a geodetic and civil engineer, to survey
and examine the two pathways and the surrounding areas, and to determine the shortest and the
least prejudicial way through the servient estates. After the survey, the engineer concluded that
pathway B is the longer route and will need improvements and repairs, but will not significantly
affect the use of Brando's property.

On the other hand, pathway A that had long been in place, is the shorter route but would
significantly affect the use of Brando's property. In light of the engineer's findings and the
circumstances of the case, resolve the parties' right of way dispute.

SUGGESTED ANSWER:

I will rule in favor of Brando.

According to Art. 650 and further reiterated in the case of Anastacia Quimen vs. CA and Yolanda
Oliveros May 29, 1996, the court ruled that if these two conditions do not concur in one estate,
the criterion of least prejudice prevails over shortest distance. The easement of right of way should
be established at a point least prejudicial to the servient estate where the distance from the
dominant estate to the public highway may be the shortest.

In this case, to establish the easement on the property of Brando would significantly affect his use
of his property whereas while Pathway B may prove to be the longer route, it will cause least
prejudice to Brando. Andres’ argument that Pathway B is circuitous and inconvenient to use
should not be given weight because the true test of the establishment of an easement is
adequacy. Convenience of the dominant estate has never been the gauge for the establishment
of the easement.
 Tomas Encarnacion vs. Court of Appeals,
G.R. No. 77628, March 11, 1991
Contributor: Tria, Ninotchka II N.

Doctrine: An easement of right of way exists as a matter of law when a private property has no
access to a public road and the needs of such property determines the width of the easement
which requires payment of indemnity which consists of the value of the land and the amount of
the damages caused.

Question:

X is the owner of the dominant estate which is bounded on the north by the servient estates of Y
and Z, on the south by a dried river and the Taal Lake. The servient estate is bounded on the
north by the National Highway.

Prior to 1960, persons going to the national highway would just cross the servient estate at no
particular point. In 1960, Y and Z enclosed their lands with a fence but provided a road path 25
meters long and about 1 meter in width. At this time, X started his plant nursery business on his
land. When his business flourished, it became more difficult to transfer the plants and garden soil
through the use of a pushcart so X bought an owner-type jeep for transporting the plants.
However, the jeep could not pass through the road path so he approached Y and Z asking them
if they would sell to him 1 ½ meters of their property to add to the existing road path but the 2
refused the offer.

X then instituted an action before the RTC to seek the issuance of a writ of easement of a right of
way over an additional width of at least 2 meters. Is X entitled to an widening of an already
existing easement of right-of-way?

Suggested Answer:

Yes.

X has sufficiently established his claim. Generally, a right of way may be demanded: (1) when
there is absolutely no access to a public highway, and (2) when, even if there is one, it is difficult
or dangerous to use or is grossly insufficient.

In the case at bar, although there is a dried river bed, t it traversed by a semi-concrete bridge
and there is no egress or ingress from the highway. For the jeep to reach the level of the highway,
it must literally jump 4-5 meters up. And during rainy season, it is impassable due to the floods.
When a private property has no access to a public road, it has the right of easement over adjacent
servient estates as a matter of law. With the non-availability of the dried river bed as an alternative
route, the servient estates should accommodate the needs of the dominant estate. Art. 651
provides that “the width of the easement of right of way shall be that which is sufficient for the
needs of the dominant estate …” To grant the additional easement of right of way of 1 ½ meters,
X must indemnify Y and Z the value of the land occupied plus amount of the damages caused
until his offer to buy the land is considered.
 Celestino Tatel vs. Municipality of Virac,
G.R. No 40243, March 11, 1992;
Torrefranca, Ian Kharlo

Doctrine: A legally constructed warehouse may not be removed, nor destroyed from its present
location, except those materials that are inflammable in nature, which may possess grave danger
and safety to the lives and properties of the neighborhood

COMPANY X with valid permit constructed a warehouse wherein it is operating an Abaca bailing
machine inside. The company received a complaint against nearby residents because of
disturbance which affected the peace and tranquility of the neighborhood due to the smoke,
obnoxious odor and dust emitted by the machine. The LGU has an existing ordinance prohibiting
the construction of warehouses near a block of houses either in the poblacion or barrios without
maintaining the necessary distance of 200 meters from said block of houses to avoid loss of lives
and properties by accidental fire and conducted an investigation on the matter and the committee
noted that the crowded nature of the neighborhood with narrow roads and surrounded by
residential houses, taken into consideration accidental fire within the warehouse by continuance
of the activity and storing of inflammable materials created a danger to the lives and properties of
the people within the neighborhood. Subsequently, the LGU created and passed a resolution
declaring the warehouse owned and operated by COMPANY X as a nuisance within the purview
of Article 694 of the New Civil Code. Is there a nuisance in this case?

Suggested Answer:

Yes, there is a nuisance.

Article 694 of the Civil Code provides that nuisance is any act, omission, establishment, condition
of property, or anything else, which (1) injures or endangers the health and safety or others,
among others. In the decided case of Celestino Tatel v. Municipality of Virac, the court held
that a warehouse constructed under a valid permit issued by the municipality and in accordance
with existing regulations or ordinance may not be destroyed or removed from its present location,
except those storage of inflammable materials, which posses grave danger and safety to the lives
and properties of the neighborhood.

In the given problem, the warehouse of COMPANY X is legally constructed under a valid permit
issued by the LGU, its warehouse then cannot be removed, transferred or destroyed. However,
there is still nuisance, because of the storage of inflammable materials which poses danger to the
lives and properties of the people within the neighborhood. The resolution therefore, is a valid
exercise of police power by the LGU. In essence it is the presence of, or the storage of
inflammable materials that is being regulated, and not the construction of a warehouse within the
designated parameter.

Thus, nuisance is present.

 Camilo E. Tamin vs. Court of Appeals,
G.R. No 97477, May 8, 1992;
Tan, Aljon

Doctrine: Should there be a dispute as to the ownership of the subject property in a civil action
against a public nuisance, the remedy of filing a civil action against a public nuisance must be
stopped until the real owner of the subject property can be determined.

The complaint, denominated as "Ejectment with Preliminary Injunction and Damages", alleged
that the plaintiff (petitioner municipality) is the owner of a certain parcel of residential land; that
the said parcel of land was reserved for public plaza under Presidential Proclamation No. 365
dated March 15, 1968; that during the incumbency of the late Mayor, the municipality leased a
portion of the parcel of land to the defendants (respondents herein) subject to the condition that
they should vacate the place in case it is needed for public purposes; that the defendants
religiously paid the rentals until 1967; that thereafter, the defendants refused to pay the rentals;
that the incumbent mayor discovered that the defendants filed a "Cadastral Answer" over said
lot; that the defendants refused to vacate the place despite efforts of the municipality; that the
national government had allotted an appropriation for the construction of a municipal
gymnasium within the public plaza but the said construction which was already started could not
continue because of the presence of the buildings constructed by the defendants; that the
appropriation for the construction of the gymnasium might be reverted back to the national
government which would result to "irreparable damage, injury and prejudice" to the municipality
and its people who are expected to derive benefit from the accomplishment of the project.
Instead of filing an answer, the respondents filed a motion to dismiss alleging the lack of
jurisdiction of the trial court, since the complaint is for illegal detainer which is within the original
jurisdiction of the municipal court and the pendency of a cadastral case between the parties
over the ownership of the same parcel of land.

The petitioner Judge denied the motion to dismiss and granted the motion for a writ of
possession with the ancillary writ of demolition by applying the rule on eminent domain (Rule 67
of the Revised Rules of Court, erroneously referred to as Rule 68) in analogy in that under this
Rule the complainant is given the right to the writ of possession in order that public construction
and projects will not be delayed. Private respondents filed a petition for certiorari with the Court
of Appeals. The petition was given due course and a temporary restraining order was issued.
The petitioners now contend that the allegations in the complaint constitute a cause of action for
abatement of public nuisance under Article 694 of the Civil Code. On the basis of this
proposition, the petitioners assert that petitioner municipality is entitled to the writ of possession
and writ of demolition.

Whether or not the petitioner municipality is entitled to a writ of possession and a writ of
demolition even before the trial of the case starts?
Suggested Answer: No, the petitioner municipality is not entitled to a writ of possession and a
writ of demolition even before the trial of the case starts. The issuance of the writ of possession
and writ of demolition by the petitioner Judge in the ejectment proceedings was premature in
this case. To begin, applying the criteria, provided by Arts. 694 and 695 of the Civil Code, the
complaint alleges factual circumstances of a complaint for abatement of public nuisance.

Article 694 of the Civil Code defines nuisance as follows:

“A nuisance is any act, omission, establishment, business, condition of property or anything else
which: xxx xxx xxx
(5) Hinders or impairs the use of property.

while Article 695 provides:

Nuisance is either public or private. A public nuisance affects a community or neighborhood or
any considerable number of persons, although the extent of the annoyance, danger or damage
upon individuals may be unequal . . .'

Article 699 of the Civil Code provides for the following remedies against a public nuisance:
"(1) A prosecution under the Penal Code or any local ordinance; or
(2) A civil action; or
(3) Abatement, without judicial proceedings."

The petitioner municipality had three remedies from which to select its course of action. It chose
to file a civil action for the recovery of possession of the parcel of land occupied by the private
respondents. If, therefore, the allegations in the complaint are true and that the parcel of land
being occupied by the private respondents is indeed a public plaza, then the writ of possession
and writ of demolition would have been justified. In fact, under such circumstances, there would
have been no need for a writ of possession in favor of the petitioner municipality since the
private respondents' occupation over the subject parcel of land can not be recognized by any
law. A writ of demolition would have been sufficient to eject the private respondents.

However, not only did the municipality avoid the use of abatement without judicial proceedings,
but the status of the subject parcel of land has yet to be decided.

Technically, a prejudicial question shall not rise in the instant case since the two actions
involved are both civil in nature. However, we have to consider the fact that the cadastral
proceedings will ultimately settle the real owner/s of the disputed parcel of land. In case
respondent V is adjudged the real owner of the parcel of land, then the writ of possession and
writ of demolition would necessarily be null and void. Not only that. The demolition of the
constructions in the parcel of land would prove truly unjust to the private respondents.

Parenthetically, the issuance of the writ of possession and writ of demolition by the petitioner
Judge in the ejectment proceedings was premature. What the petitioner should have done was
to stop the proceedings in the instant case and wait for the final outcome of the cadastral
proceedings.
 Sps. Uy, et. al., v. Sps. Rana, G.R. No. 192862, June 30, 2014
Contributor: Eleccion, Eric R.

Doctrine: Unless a nuisance is a nuisance per se, it may not be summarily abated.
W and Sps. O (W-O) co-owned a residential land abutting a 10-meter-wide subdivision
road which is of the same level with their property. Opposite to it are the adjacent lots of Sps. U
and Sps. R. The said lots follow a rolling terrain with the Sps. R property standing about two
meters higher than and overlooking the Sps. U property. The controversy, which reached the trial
court, arose when Sps. R elevated and cemented a portion of the road between their property
and the W-O’s in order to level it with their gate. During the pendency of the proceeding, W-O
filed a motion and was granted by the court allowing them to bring in heavy equipment for the
development of their property. Though not expressly included in the grant of the motion, W-O
proceeded to level the elevated and cemented road which hampered Sps. R’s ingress and egress
to their residence. Aggrieved, Sps. R filed a supplemental pleading praying for the restoration of
the portion of the road and payment of damages.

The trial court found that Sps. R, without prior consultation with their neighbors, developed
to their advantage a portion of the 10-meter wide subdivision road and on the other hand, W-O
enforced the order granting their motion caused damage to Sps. R which amounted to bad faith.
Consequently, no relief can be granted to the parties as they both acted in bad faith applying the
in pari delicto doctrine. This was affirmed by the appellate court. Were both courts correct?

Suggested Answer:

Yes, both courts were correct in denying the relief both prayed for but they were incorrect
in the application of the in pari delicto doctrine.

Jurisprudence classifies nuisances in relation to their legal susceptibility to summary

abatement as a nuisance per se and a nuisance per accidens. It is a standing jurisprudential rule
that unless a nuisance is a nuisance per se, it may not be summarily abated.

In the present case, what has transpired is a nuisance per accidens. The elevated and
cemented portion of the road is not injurious to the health or comfort of the community. Such a
nuisance cannot be summarily abated. The demolition of said portion by W-O remains
unwarranted and damages should have been awarded to Sps. R. However, the introduction of
such a nuisance by Sps. R transgressed the rights to the unobstructed use and free passage over
the subject road. In effect, they should be held similarly liable for damages. These claims of
damages, can be offsetted but not on the ground of in pari delicto. The principle of in pari delicto
does not apply with respect to inexistent and void contracts.

As there is no void or inexistent contract at issue, therefore, the invocation of the in pari
delicto doctrine is misplaced. Nevertheless, considering their infractions, the denial of the relief
shall be sustained..
 Unisource Commercial and Dev’t Corp. vs. Joseph Chung, et. Al.
G.R. No. 173252, July 17, 2002
Contributor: INOT, RENE A.

DOCTRINE: Legal and Voluntary Easements

Question:

Pedro Penduko bought a piece of land registered under TCT No. 123456 previously owned
by Santo Santino which was considered to be a Servient Estate. It has a memorandum of
encumbrance for easement in favor of Francisco Baltazar, owner of the Dominant Estate. The
servient property has been sold multiple times and ownership passes through different persons
until it reaches finally to the hands of Pedro where the annotation of encumbrance of a voluntary
easement remains. The property of Francisco Balatazar on the other hand the dominant estate
has also been transferred to different ownership until in the hands of Josephus Chiongbian the
latest owner. Pedro Punduko now files a petition before the RTC for the cancellation of the
voluntary easement annotation in favor of dominant estate on the grounds that the subject
property has already been alienated to different person from the moment of its registration of
memorandum for voluntary easement and that dominant property now has another access to the
main road without passing through the servient property. Is the contention of the Petitioner
tenable?

Suggested Answer:

No, the contention of Pedro Penduko the petitioner is not tenable.

Article 619 of the civil code provides that easements are established either by law or by
will of the owners. The former are called legal and the latter voluntary easements. Jurisprudence
provides in the case of Unisource Commercial and Dev’t Corp. vs. Joseph Chung, et. Al. G.R.
No. 173252, July 17, 2002 that a voluntary easement of right of way, like any other contract, could
be extinguished only by mutual agreement or by renunciation of the owner of the dominant estate.

In the case at bar, the memorandum of encumbrance was registered by the original owner
Santo Santino in favor of Francisco Baltazar by virtue of their mutual agreement. It is executed
by the parties to protect the interest of their lawful successors or the successors in interest and
the public as the case may be. Their agreement and the subsequent registration of encumbrance
was voluntary in nature and therefore could only be extinguished by mutual agreement or
renunciation of the owner of the dominant estate as distinguished from easement created by virtue
of the law or statute where easement cease to become effective should there be other convenient
access by the dominant property to the highway. The voluntary easement annotation in this case
remains effective unless otherwise agreed by both the parties of dominant estate and the servient
estate or by renunciation by the owner of the dominant estate.

Hence, Pedro Penduko’s petition for the cancellation of the annotation will not prosper.
 PILAR DEVELOPMENT CORPORATION, Petitioner, v. RAMON DUMADAG, EMMA
BACABAC, RONALDO NAVARRO, JIMMY PAGDALIAN, PAY DELOS SANTOS,
ARMANDO TRILLOS, FELICISIMO TRILLOS, ARCANGEL FLORES, EDDIE
MARTIN, PRESILLA LAYOG, CONRADO CAGUYONG, GINA GONZALES, ARLENE
PEDROSA, JOCELYN ABELINO, ROQUE VILLARAZA, ROLANDO VILLARAZA,
CAMILO GENOVE, NILDA ROAYANA, SUSAN ROAYANA, JUANCHO
PANGANIBAN, BONG DE GUZMAN, ARNOLD ENVERSO, DONNA DELA RAZA,
EMELYN HAGNAYA, FREDDIE DE LEON, RONILLO DE LEON, MARIO MARTINEZ,
and PRECY LOPEZ,
G.R. NO. 194336 : March 11, 2013
Contributor: Lufrangco, Philips F.

Bar Question:

X owned Pilar Village Subdivision at Las Pinas where Y allegedly built their shanties without X
knowledge or consent. Thus, a complaint for accion publiciana was filed against Y. Y denied the
material allegation of the complaint asserting that it’s the local government and not the petitioner
who has authority over them.

RTC dismissed the complaint saying that the land in question is situated on the sloping area
leading down a creek and within the 3-meter legal easement and thus, its considered as public
property and part of public dominion under Article 502 of the New Civil Code. With this, only the
local government of Las Pinas City could institute an action for recovery of possession or
ownership. The CA dismissed the case but noted that the proper party to seek recovery of the
property is not the City of Las Pinas but the Republic of the Philippines, through the OSH pursuant
to Section 101 of the Commonwealth Act No. 141. Is the land in question part of public land? Or
is it owned by the servient estate?

Suggested Answer:

The property in question is part of the public property.

Although according to Article 630 of the Civil Cove provides the general rule that the owner of the
estate retains the ownership of the portion of the easement established. However, under Article
635 provides that “all matters of easements established for public or communal use shall be
governed by the special laws and regulations relating thereto. Furthermore, the water code of the
Philippines provides that such 3-meter legal easement in creeks is for public use. Therefore, it
cannot be denied that such land is Public land.
 Felicitas B. Borbajo v. Hidden View Homeowners, Inc., et. al.,
G.R. No. 152440, January 31, 2005
Penaranda, Michael Ian V.

DOCTRINE: The owner has the right to enjoy and dispose of a thing without other limitations
than those established by law.

Bordajo bought from Bontuyan 3 road lots. Bontoyan then developed a subdivision named
Hidden View Subdivision I and later secured a license to sell from the HLURB. Meanwhile,
Bordajo also decided to develop a subdivision the other properties adjacent to the Hidden View
Subdivision I, which she also acquired, and named it ST Ville Properties. Bordajo was able to
secure Certificate of Registration for another subdivision project called Hidden View Subdivision
II. The two projects of Bordajo were located at the back of Hidden View Subdivision I.

With the said projects, the Homeowners association of Hidden View Subdivision I caused
the construction of a guardhouse at the entrance and hired the services of a security guard to
prevent the unauthorized persons and construction vehicle from passing. Said action adversely
affected the residents of the subdivisions as well as the ongoing construction of Bordajo’s
projects. She then filed before the RTC an action for damages and injunction against the
Homeowner’s association and prayed for the issuance of TRO directing defendants to maintain
status quo and to desist from preventing construction vehicles, workers, etc. from passing through
the road lots. May the defendants legally prevent Bordajo from using and passing through the lots
within the subdivision?

Suggested Answer:

No. The defendant cannot legally prevent the Bordajo from using and passing through the
lots within the Subdivision.

The Civil Code provides that the owner has the right to enjoy and dispose of a thing without
other limitations than those established by law. Likewise, the dominant estate cannot be the
servient estate at the same time.

Here, Bordajo’s projects is located at the back of the Hidden View Subdivision I, thus
making the 2 subdivision projects would be deemed as the Dominant Estates, while the
Homeowner’s Subdivision lots including its existing roads becomes the Servient Estate. In
addition, with regard to easement, as a registered co-owner of the road lots, it is pointless to
discuss whether she is entitled to the easement right of way. One of the characteristics of an
easement is that it can be imposed only on its own property. An easement can exist only when
the servient and the dominant estates belong to different owners.

Hence, The defendant cannot legally prevent the Bordajo from using and passing through
the lots within the Subdivision.
 Crispin Dichoso, Jr., et. al., v. Patrocinio L. Marcos,
G.R. No. 180282, April 11, 2011;
Canonigo, Elizabeth

DOCTRINE: The convenience of the dominant estate has never been the gauge for the grant of
compulsory right of way. To be sure, the true standard for the grant of the legal right is "adequacy."
Hence, when there is already an existing adequate outlet from the dominant estate to a public
highway, as in this case, even when the said outlet, for one reason or another, be inconvenient,
the need to open up another servitude is entirely unjustified.

Bea is an owner of a lot located in between other private lots. She frequently uses a portion of the
lot of Rey going to the national highway. One day, Rey blocks the passageway with piles of sand.
Later on, Spouses Arce granted Bea a right of way to the national highway through their lot.

Bea filed a complaint for easement of right of way against Rey arguing that the right of way that
Spouses Arce granted is longer and circuitous and thus cannot be considered as adequate.

If you are the judge, how would you rule on the complaint?

Suggested Answer:

If I am the judge, I will dismiss the complaint.

The Supreme Court ruled in several cases that the convenience of the dominant estate has never
been the gauge for the grant of compulsory right of way. To be sure, the true standard for the
grant of the legal right is "adequacy." Hence, when there is already an existing adequate outlet
from the dominant estate to a public highway even when the said outlet, for one reason or another,
be inconvenient, the need to open up another servitude is entirely unjustified.

In the present case, Bea cannot be granted the compulsory right of way through the lot of Rey
because there is already an existing passageway from her lot to the national highway. In order to
justify the imposition of an easement of right of way there must be real, not fictitious or artificial,
necessity for it. Mere convenience for the dominant estate is not what is required by law as the
basis of setting up a compulsory easement. Even in the face of necessity, if it can be satisfied
without imposing the easement, the same should not be imposed.
 Bogo-Medellin Million Co., Inc., v. Court of Appeals, et. al.,
G.R. No. 124699, July 31, 2003;
Batandolo, Krizabelle Marie P.

DOCTRINE: The discontinuous easement of a railroad right of way can only be acquired by title
and not by prescription.

In 1929, Z granted Y Inc. a railroad right of way for a period of 30 years. In 1935, Z sold the same
land to X. The right of way expired sometime in 1959 but heirs of X allowed Y Inc. to continue
using the land because one of them was then an employee of the company, making Y Inc. acquire
an easement of right of way by unopposed and continuous use of the land.

Y Inc. now reiterates its claim of ownership of the land through extraordinary acquisitive
prescription. Is the contention of Y Inc. correct?

SUGGESTED ANSWER:

No, the contention of Y Inc. is not correct.

Article 622 provides that the discontinuous easement of a railroad right of way can only be
acquired by title and not by prescription.

Y Inc’s use of the right of way, however long, never resulted in its acquisition of the easement. It
unequivocally declared the property to be a "central railroad right of way" or "sugar central railroad
right of way" in its real estate tax receipts when it could have declared it to be "industrial land" as
it did for the years 1975 and 1985. Instead of indicating ownership of the lot, the aforementioned
receipts showed that all Y Inc. had was possession by virtue of the right of way granted to it. An
acknowledgment of the easement is an admission that the property belongs to another. A person
cannot have an easement on his own land, since all the uses of an easement are fully
comprehended in his general right of ownership.

Hence, petitioner Y Inc. cannot assert that its occupancy since 1929 was in the concept of an
owner. Neither can it declare that the 30-year period of extraordinary acquisitive prescription
started from that year.
 (s) Republic of the Philippines v. Spouses Idelfonso & Francia Regulto
G.R. No. 202051, April 18, 2016
Contributor: Colong, Aleijah Ummiessalam A.

Spouses Adolfo are registered owners of a land consisting of 300 sq meters covered by (TCT)
No. 086-2010000231. The spouses obtained the property through a Deed of Sale from Spouses
Sarsi. The subject property originated from a Free Patent property consisting of 7,759 square
meters registered and covered by Original Certificate of Title (OCT) No. 235. The DPWH of
Camarines Sur apprised Spouses Adolfo of construction if its road which will traverse their
property and other adjoining properties and initially offered the spouses of P243,000.00 of just
compensation. However, The DPWH withdrew the offer, and informed the Spouses Regulto that
they were not entitled to just compensation since the title of their land originated from a Free
Patent title acquired under the Public Land Act, which contained a reservation in favor of the
government of an easement of right-of-way of twenty (20) meters, which was subsequently
increased to sixty (60) meters. The Spouses Adolfo protested the findings of the DPWH and
ordered them to cease from proceeding with the construction and filed a complaint for payment
of just compensation before the RTC of Naga City against the Petitioners. RTC ruled that the law
regarding easement of right-of-way in favor of the government does not apply to the subject
property since the property is already a private property since the Spouses Regulto acquired the
same through a deed of absolute sale from the Spouses Sarsi. Is the RTC correct?

Suggested Answer:

No, the RTC is not correct.

Jurisprudence dictates that lands granted by patent shall be subject to a right-of-way not
exceeding 60 meters in width for public highways, irrigation ditches, aqueducts, and other similar
works of the government or any public enterprise, free of charge, except only for the value of the
improvements existing thereon that may be affected.

In this case, although the property is already a private property, the reservation and condition
contained in the OCT of lands granted by free patent, like the origins of the subject property, is
not limited by any time period. With the existence of the said easement of right-of-way in favor of
theGovernment, the petitioners may appropriate the portion of the land necessary for the
construction of the bypass road without paying for it, except for damages to the improvements.
Payment of just compensation is still required over the remaining area of the subject property.

Therefore, the RTC’s contention is not correct.

 Alicia B. Reyes v. Spouses Francisco S. Valentin and Anatalia Ramos,
G.R. No. 194488, February 11, 2015;
Contado, Janjan

DOCTRINE:

An easement of right of way imposes a burden on a property and limits the property
owner's use of that property. The limitation imposed on a property owner's rights is
aggravated by an apparent lack of necessity for which his or her property will be
burdened.

Spouses Moto owned a property in Brgy. Tagabebe, Municipality of Governor Generoso. Before
the spouses passed away, they subdivided the property among their 12 Children. In which, the
children sold their share to the property to different persons. Among their buyers are Spouses
Jakka and Brey Poe.

Spouses Jakka’s property is 1,500-square-meter, located along the highway. Brey Poe’s property
is in the middle part of the subdivided land and was located behind Spouses Jakka’s property.
There is no direct access to the highway. However, she was told by the seller that there was no
intention for the property to have no outlet.

In 2021, Brey Poe planned to construct a mini hostel in her 450-square-meter land. However,
there is still no direct outlet to the highway. The easiest route to the highway is through the garage
of the house owned by Spouses Jakka. Brey Poe requested to avail a 115-square-meter of the
the leftmost portion of Spouses Jakka’s property, but to no avail.

Spouses Jakka averred that the right of way is not possible. The right of way would pass through
improvements, such as their garage, garden, and grotto. Spouses Jakka pointed to an open space
that connected Brey Poe’s property to another road. This open space has an irrigation canal that
limited access to the public road, hence a bridge needs to be constructed. In fact, their other
neighbor, Pilito, already constructed a bridge that connected her property to the public road.

Brey Poe argued that building a bridge is too burdensome and costly for her and that the proposed
easement is the least prejudicial to the Spouses’ property. Brey Poe further argued that the
isolation of her property is not due to her acts. Despite demands and willingness to pay, Spouses
Jakka resfused to accede to petitioner’s claim.

May the easement of right of way be granted to Brey Poe? Decide.

SUGGESTED ANSWER:
No, Brey Poe’s easement of right of way should be denied.
In the case of Reyes vs. Valentin (GR No. 194488, February 11, 2015), the following requisites
need to be established before a person becomes entitled to demand compulsory easement of
right of way: a.) an immovable is surrounded by other immovables belonging to other persons,
and is without adequate outlet to a public highway; b.) payment of proper indemnity by the owner
of the surrounded immovable; c.) the isolation of the immovable is not due to its owner’s acts; and
d.) the proposed easement of right of way is established at the point least prejudicial to the
servient estate, and insofar as consistent with this rule, where the distance of the dominant estate
to a public highway may be the shortest.

In this case, Brey Poe’s property was surrounded by properties owned by different persons and
she is willing to pay for the compensations on the right of way. The isolation of her property was
not due to her acts. However, Brey Poe failed to establish that there was no adequate outlet to
the public highway and that the proposed easement was the least prejudicial to Spouses Jakka’s
property. The garage, garden and grotto of spouses Jakka would be destroyed if the request of
Brey Poe is to be granted. To note, their neighbor was able to construct a bridge over the irrigation
canal. Brey Poe could also build the same bridge to connect her property to the other public road.
The presence of an available outlet that can be utilized for right of way negates Brey Poe’s claim
that Jakka’s property is the point least prejudicial to the servient estate.

Therefore, Brey Poe’s easement of right of way should be denied.

 Helen Calimoso, et. al., v. Axel D. Roullo,
G.R. No. 198594, January 25, 2016;
Diwag, Kyrie Leonelyn

Question:

Cutie Pie alleged that he is the owner of a lot situated in Brgy. Guadalupe, Cebu City, isolated
by surrounding estates including the lot owned by Bunny Bun, Benny Bun and Billy Bun. He
claimed that he needs a right of way in order to have access to a public road and that the
shortest and most convenient access to the nearest public road passes through the Buns’ lot.
The Buns objected because it would cause substantial damage to the two houses already
standing on their property and they alleged that there was an alternative route for the
respondent. The RTC granted the respondent’s complaint and ordered the petitioners to provide
the respondent an easement of right-of-way. The CA, affirmed in toto the RTC’s decision and
held that all the requisites for the establishment of a legal or compulsory easement of right-of-
way were present.

Is the ruling of the CA correct?

Suggested Answer:

NO. The CA’s ruling is erroneous. To be entitled to an easement of right-of-way, the following
requisites should be met:

1. The dominant estate is surrounded by other immovables and has no adequate outlet to
a public highway
2. There is payment of proper indemnity
3. The isolation is not due to the acts of the proprietor of the dominant estate
4. The right-of-way claimed is at the point least prejudicial to the servient estate; and
insofar as consistent with this rule, where the distance from the dominant estate to a
public highway may be the shortest.

Cutie Pie in whose favor the easement is established is the dominant estate while the Buns are
the servient estate.There is no question that the main issue is whether the fourth element is
satisfied. It is clear that the Buns’ property is the shortest but is not least prejudicial because
there would be a destruction of several properties. Jurisprudence provides that if these two
criteria (shortest distance and least damage) do not concur in a single tenement, the least
prejudice criterion must prevail over the shortest distance criterion

Thus, the right-of-way passing through the petitioners' lot does not satisfy the fourth requirement
of being established at the point least prejudicial to the servient estate because it would
cause the destruction of the wire fence and a house on the petitioners’ property. Although this
right-of-way has the shortest distance to a public road, it is not the least prejudicial considering
that an option to traverse two vacant lots without causing any damage is available.
 Woodridge School, Inc., v. ARB Construction Co., Inc.,
G.R. No. 157285, February 16, 2007;
Dizon, Maica Carmel Shirl

Question:

Kahoy University Inc. (Kahoy) is the usufructuary of a parcel of land in the name of spouses X.
Its co-petitioner, Y, is the registered owner of the adjacent lot of Kahoy University. Respondent
ABC Construction is the owner and developer of Mountain Subdivision, which is composed of four
phases. Kahoy and Y’s properties sit in the middle of the several estates which includes ABC
Construction’s property. Kahoy and Y offered to pay ABC Construction P50,000.00 as indemnity
for the use of the road. Stubborn, ABC Construction refused and fenced the perimeter of the road
fronting the properties of petitioner. Thus, ABC Construction effectively cut off petitioners’ access
to and from the public highway.

Further, Kahoy and Y jointly filed a complaint in the RTC as to enjoin ABC Construction from
depriving them of the use of the disputed subdivision road and to seek a compulsory right of way
after payment of proper indemnity. The RTC rendered a decision in favor of Kahoy and Y without
the need for payment of indemnity for the use of the road subdivision. The case was elevated to
the CA and reversed the decision. The CA ruled in favor of ABC Construction is entitled to
P500,000.00 as indemnity for the use of the subject property.

Hence, the Kahoy and Y filed a petition for certiorari before the Supreme Court where they argued
that the contested road lot is a property of public dominion pursuant to Article 420 of the Civil
Code, specifically that the disputed road falls under the category others of similar character if the
last clause of Article 420 (1). Hence, it is a property of public dominion which can be used by the
general public without need for compensation. Also, it is wrong for ABC Construction to exclude
petitioners from using the road lot or to make them pay for the use.

(a) Would the use of the subdivision roads by the general public strip it of its private
character?
(b) Is ABC Construction entitled to indemnity?

Suggested Answer:

(a) No, the use of the subdivision roads by the general public would not strip it of its private
character.

In the case of Abellana Sr. v. Court of Appeals, the SC ruled that the road lots in a private
subdivision are private property, hence, the local government should first acquire them by
donation, purchase, or expropriation, if they are to be utilized as a public road. Otherwise,
they remain to be private properties of the owner-developer.
Therefore, the use of the subdivision roads by the general public would not strip it of its
private character. The road is not converted into public property but mere tolerance of the
subdivision owner of the public passage through it.

(b) Yes, ABC Construction is entitled to indemnity.

Under Article 649 of the Civil Code with regard to legal easement, it prescribes the
parameters by which the proper indemnity may be fixed. Since the intention of the
petitioners is to establish a permanent passage, the law emphasized that the measure by
which the proper indemnity may be computed by the value of the land occupied plus the
amount of the damage caused to the servient estate. Further, to be entitled to a legal
easement of right of way, the following requisites must concur: (1) the dominant estate is
surrounded by other immovables and has no adequate outlet to public highway; (2)
payment of proper indemnity; (3) the isolation was not due to acts of the proprietor of the
dominant estate; and (4) the right of way claimed is at the point least prejudicial to the
servient estate.

Thus, Kahoy University Inc. and Y should pay for indemnity to ABC Construction of the
measure by which the proper indemnity is computed by the value of the land occupied
plus the amount of the damage caused to the servient estate.
 Demetria De Guzman, et. al., v. Filinvest Development Corportion,
G.R. No. 191710, January 14, 2015;
Dumamba, Anderson

Doctrine/s:

In easement of right of way, there is no alienation of the land occupied. Payment of the value of
the land for permanent use of the easement does not mean an alienation of the land occupied.

Question:

De Guzman filed a complaint for Easement of Right of Way on road lot 15 against Filinvest,
which coming from petitioners' property, has a potential direct access to Marcos highway either
by foot or vehicle. The latter argues that it would be efficient for the petitioner to go to Leni
Highway, which is a shorter route compared to the road leading to Marcos Highway. The RTC
rendered a Decision granting petitioner the right of way across respondent's subdivision with
payment of indemnity of 1,620Php per sq. meter of 264-meter road lot 15. Respondents
appealed to the Court of Appeals contending that the petitioner shall pay indemnity not only for
the road lot 15, but all the road passage up to Marcos highway which shall consist of, as per
evidence, such distance of 2,350 meters covering not only Road Lot 15 but also Road Lots 3,
10, 6, 4, 2, and 1.

a.) Is Filinvest Correct?

b.) Is the Petitioner correct when he contends that he shall not be required to pay
indemnity to Filinvest because it is tantamount purchasing the property/land?

Suggested Answer:

a. Yes, Filinvest is correct.

The right of way granted to petitioners covers the network of roads within respondent's
subdivision and not merely Road Lot 15. In the case of a legal easement, Article 649 of the Civil
Code prescribes the parameters by which the proper indemnity may be fixed. Since the
intention of petitioners is to establish a permanent passage, the second paragraph of Article 649
of the Civil Code particularly applies.

Should this easement be established in such a manner that its use may be continuous for all the
needs of the dominant estate, establishing a permanent passage, the indemnity shall consist
of the value of the land occupied and the amount of the damage caused to the servient
estate.

The Civil Code categorically provides for the measure by which the proper indemnity may be
computed: value of the land occupied plus the amount of the damage caused to the servient
estate. Thus, with respect to the value of the measurement of the width of the road multiplied by
the total square meters, provided that it is not iniquitous, De Guzman shall pay indemnity to
Filinvest for the value per square meter of the road lots leading to Marcos Highway.

b. No. Petitioners are not correct.

The argument is untenable. Payment of the value of the land for permanent use of the
easement does not mean an alienation of the land occupied. In fact, under the law and unlike in
purchase of a property, should the right of way no longer be necessary because the owner of
the dominant estate has joined it to another abutting on a public highway, and the servient
estate demands that the easement be extinguished, the value of the property received by the
servient estate by way of indemnity shall be returned in full to the dominant estate. This only
reinforces the concept that the payment of indemnity is merely for the use of the right of way
and not for its alienation.
 CJ Yulo & Sons, Inc., v. Roman Catholic Bishop of San Pablo, Inc.,
G.R. No. 133705, March 31, 2005
Contributor: Licup-Romares, Melcah Joyce R.

Question:

In 1977, X donated a parcel of land in Laguna to RC, a group of priets in San Pablo, for the
purpose of building a home for the aged and infirm. One of the conditions stipulated is that it
cannot be disposed or alienated or leased without X’s prior consent. However, RC leased the
property three (3) times without asking X’s consent. Hence, X file a case to revoke the donation.
Is X correct that the donation is revocable?

Suggested Answer:

No, X is incorrect.

Jurisprudence dictates that an onerous donation is that which imposes upon the donee a
reciprocal obligation or, to be more precise, this is the kind of donation made for a valuable
consideration, the cost of which is equal to or more than the thing donated. For the donation to
be revoked, there must be a substantial breach that would defeat the purpose of the contract.

In the case at bar, since RC is burdened to put up and operate a home for the aged, it is well
within the meaning of an onerous donation. However, when RC leased the property without asking
for X’s consent, it shall only be deemed as casual breach since it did not defeat the parties’
agreement and purpose of building a home for the aged. Therefore, the donation shall not be
revoked as the breach was merely casual.
 Gonzalo Villanueva v. Spouses Froilan and Leonila Branoco,
G.R. No. 172804, January 24, 2011;
Contributor: Lumantao Raymund Larga

Doctrine: Doubts on the nature of dispositions are resolved to favor inter vivos transfers to avoid
uncertainty as to the ownership of the property subject of the deed

Question:

Petitioner A, sued Spouses X and Y in the RTC of Naval, Biliran for the recovery of a parcel of
land in Leyte. A claimed ownership over the property through purchase from B who in turn
purchased the property from C in 1970. Spouses in this case claimed ownership in their answer
through purchase in 1983 from Z to whom C donated the property in 1965.
The trial court ruled in favor of the petitioner A, saying that by the time Z sold the property to the
Spouses X and Y, Z had no title to transfer because the donation to Z by C was deemed
canceled when C decided to sell the property to B instead. Is the lower court correct and who
has a better right?

Issue:
Whether or not petitioner A’s title is superior to Spouse’s X and Y

Suggested Answer:
Spouses X and Y has a better title over petitioner A.
As provided by law, donation inter vivos is immediately operative and irrevocable. It passes title
to the Donee upon its acceptance of the instrument, being liberality as the consideration.
In the case at bar, the instrument executed by C in favor of Z for its services as the
consideration, has created a perfected contract of donation. The instrument executed neither
reserve any right nor conditions that would indicate otherwise. The contract of sale by C to B
did not transmit any right which Petitioner A’s predecessor in interest. Under the principle of
nemo dat qoud non habet, no one can give what they do not have.
Hence, Spouses X and Y have a superior title to petitioner A.
 Corazon Catalan, et. al., v. Jose Basa, et. al.,
G.R. No. 159567, July 31, 2007
Contributor: Lumogdang, Lian Mae F.
Doctrine:

In order for donation of property to be valid, what is crucial is the donor’s capacity to give
consent at the time of the donation.

Question:

X is a former military personnel who was rendered unfit for service due to Schizophrenia. After
his discharge from service, he donated half of his land to his sister Y. Subsequently, the court
declared X incompetent and appointed a guardian for his estate.

Y decided to sell the donated property she received to her children A and B. Upon learning of the
sale, the guardian of X filed a Complaint for Declaration of Nullity of Documents, Recovery of
Possession and Ownership, and damages. He alleged that the Deed of Absolute Donation to Y
was void ab initio, as X was not of sound mind and was therefore incapable of giving valid consent
during the execution of the donation. Is the contention correct?

Answer:

No, it is not correct.

A donation is an act of liberality whereby a person disposes gratuitously a thing or right in favor
of another, who accepts it. In order for donation of property to be valid, what is crucial is the
donor’s capacity to give consent at the time of the donation. Insanity impinges on consent freely
given. However, the burden of proving such incapacity rests upon the person who alleges it; if no
sufficient proof to this effect is presented, capacity will be presumed.

In the given case, the mere allegation of the existence of schizophrenia failed to show substantial
proof that at the date of the donation X had lost total control of his mental faculties. Sufficient proof
of his infirmity to give consent to contracts was only established when the court declared him an
incompetent.

Hence, the donation is deemed valid.