Right of Accession

G.R. No. 149295

PNB vs De Jesus
Vitug
Summarized by Sarah
IMPORTANT PEOPLE
Philippine National Bank Petitioner
Generoso De Jesus - Respondent
FACTS
1. Generoso De Jesus owned a parcel of land in Maburao, Occidental Mindoro.
2. 10 June 1995 De Jesus filed a complaint against PNB before the RTC of
Occidental Mindoro for recovery of ownership and possession over the
questioned property.
- In his complaint, respondent stated that he had acquired the parcel of
land, with an area of 1,144 sq. m. covered by TCT No. T-17197.
- After a verification survey of the property, he discovered that the northern
portion of the lot was being encroached upon by a building of petitioner to
the extent of 124 square meters.
- Despite two letters of demand sent by respondent, petitioner failed and
refused to vacate the area.
3. Petitioners answer:
- PNB asserted that when it acquired the lot and the building sometime in
1981 from then Mayor Bienvenido Ignacio, the encroachment already was
in existence
- To remedy the situation, Mayor Ignacio offered to sell the area in question
to petitioner at P100 per square meter which offer the latter claimed to
have accepted.
- The sale did not materialize when, without the knowledge and consent of
petitioner, Mayor Ignacio later mortgaged the lot to DBP.
4. RTC decided the case in favor of respondent.
- RTC ordered PNB to surrender possession of the property to respondent
and to cause, at its expense, the removal of any improvement thereon.
5. CA sustained the trial court.

ISSUE with HOLDING

1

1. Whether or not PNB is a builder in bad faith YES

The RTC and the CA both rejected the idea that petitioner can be
considered a builder in good faith.
With regard to the context it is used in Articles 448, 449 and 450 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.
Under the said provisions, a builder in good faith can compel the
landowner to make a choice between appropriating the building by paying
the proper indemnity or obliging the builder to pay the price of the land.
The choice belongs to the owner of the land, a rule that accords with the
principle of accession, i.e., that the accessory follows the principal and not
the other way around.
In order that the builder can invoke that accruing benefit and enjoy his
corresponding right to demand that a choice be made by the landowner,
he should be able to prove good faith on his part.
The essence of good faith lies in an honest belief in the validity of
ones 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.
Given the findings of both the RTC and the CA, it should be evident
enough that petitioner would fall much too short from its claim of good
faith.
Petitioner was quite aware, and indeed advised, prior to its
acquisition of the land and building from Ignacio 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
Ignacio, has in actuality been part of the property transferred to petitioner.
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.

DISPOSITIVE PORTION

WHEREFORE, the decision of the Court of Appeals in CA-G.R. CV No. 56001 is

AFFIRMED.
DOCTRINE
With regard to the context it is used in Articles 448, 449 and 450 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.
A builder in good faith can compel the landowner to make a choice between
appropriating the building by paying the proper indemnity or obliging the builder
to pay the price of the land.
Good faith is an intangible and abstract quality with no technical meaning or
statutory definition, and it encompasses, among other things, an honest belief,
the absence of malice and the absence of design to defraud or to seek an
unconscionable advantage. It implies honesty of intention, and freedom from
knowledge of circumstances which ought to put the holder upon inquiry.
The essence of good faith lies in an honest belief in the validity of ones right,
ignorance of a superior claim, and absence of intention to overreach another.