Property Principles - Midterm Reviewer

OUTLINE IN PROPERTY
PRELIMINARY PROVISIONS
INTRODUCTION
A. Property, Concept of Things, Susceptibility of Appropriation etc, Right to Property, and

Ownership
Property – not confined to tings which are already appropriated or possessed by man but also extends to
those susceptible of such appropriation, although not yet appropriated.
Requisites:
a. Susceptibility to appropriation
b. Utility (can serve as means to satisfy human needs)
c. Substantivity (must have an autonomous and separate existence)
Things – embraces both material objects and rights
Classification of property
1) Nature: immovable (real) or movable (personal)
2) Movables: consumable or non-consumable
3) Ownership: public dominion or private ownership
Importance of Classification
a) for applying rules on acquisitive prescription: movables (prescribes through uninterrupted possession for
4 years in good faith or 8 years, without need of any other condition); immovables (ordinary prescription
through possession of 10 or 30 years, without need of title or of good faith)
b) to determine propriety of object: movables (contracts of pledge and chattel mortgage); immovable (real
estate mortgage contract)
c) formalities of donation: personal property exceeding P5,000 in value (in writing); immovable property
(made in a public document)
d) extrajudicial deposit: only movable things
e) crimes: personal property (theft and robbery); real property (usurpation)
f) remedial law: real property (court where real property is situated); other actions (where plaintiff or
defendant resides, at the election of the plaintiff)
IMMOVABLE PROPERTY
Immovable Property – no definition under the law; only enumeration under Art 415
Classes of Immovables (Art 415):

1) Immovable by Nature: immovable by essence; cannot be moved from one place to another; e.g. lands,
buildings, roads, and constructions of all kinds adhered to the soil (par 1); mines, quarries and slug dumps,
while the matter thereof forms part of the bed and waters either running or stagnant (par 8)
2) Immovable by Incorporation: treated as immovable by reason of their attachment or incorporation to an
immovable in such manner as to be an integral part thereof; e.g. buildings (par 1); trees, plants, and
growing fruits, while they are attached to the land or form an integral part of an immovable (par 2);
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 (par 3)
3) Immovable by Destination: essentially movable, but by purpose for which they have been placed in an
immovable, partake of the nature of the latter because of the added utility derived therefrom; e.g. 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
(par 4); 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 (par 5); 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, including
animals (par 6); fertilizer actually used on a piece of land (par 7); docks and structures which are intended
by their nature and object to remain at a fixed place on a river, lake or coast (par 9)
4) Immovable by Analogy or by Law: e.g. contracts for public works, and servitudes and other real rights
over immovable property
Real Property under Par 1:
lands and roads always immovable by their nature;
buildings are immovable by incorporation by reason of its adherence to the soil on which it is built;
building which is merely superimposed on the soil is not a real property;
building treated separately from the land on which it stood is immovable property and the mere fact that the
parties to a contract seem to have dealt with it separate and apart from the land on which it stood in no
wise changed its character as immovable property;
while it is true that a mortgage of land necessarily includes, in the absence of stipulation, the improvements
thereon, still a building by itself may be mortgaged apart from the land on which it has been built;
a building is an immovable property regardless of whether or not said structure belong to the same owner
of the land on which it is adhered to, since the law makes no distinction as to whether or not the owner of
the land is or is not the owner of the building;
“parties to a contract may by agreement treat as personal property that which by nature would be a real
property”, however the fact remains that the nature of a building does not depend on the way the parties
deal with it; constructions adhered to the soil must be permanently attached and not of provisional or
temporary character

trees, plants and growing fruits are immovable while attached to the land, but becomes movable when cut
or uprooted except when timber constitutes the natural product of the tenement and forms an integral part
of the immovable;
growing fruits are real property as long as they are attached to the soil, except for the purpose of sale of
the whole or part of the crops, ungathered fruits are considered as personal property

immovable by incorporation; must be attached in a fixed manner in such a way that they cannot be
separated without breaking the material or deterioration of the object;
need not be attached by the owner;
exception, if the parties treat the machinery as chattels, they are bound by their agreement under the
principle of estoppel notwithstanding the fact that the machinery may have been attached to an immovable
in a fixed manner and may not be separated without breaking the material or deterioration of the object to
which it is attached

immovable by destination;
requisites (1. Must be placed in buildings or on lands by the owner of the immovable or by his agent, 2.
Attachment must be intended to be permanent);
incorporation must be made by owner or his agent; separation is impossible

essentially movables but because of their purpose becomes real properties;
requisites (1. Must be machinery, receptacles, instruments or implements, 2. Placed by owner or by his
agent, 3. There is industry or work carried in such building or on the piece of land, 4. Directly meet the
needs of said industry or work);
must be placed by owner and not by tenant, usufructuary, or any other person having only a temporary
right; machinery, receptacles, instruments or implements when placed by the lessee remains personal,
except if in the contract of lease it is stipulated that machinery, receptacles, instruments or implements
placed by the lessee will become, at the termination of lease, the property of the lessor for in that case they
will be considered as immovable since in placing them the lessee will just be merely acing as an agent of
the lessor;
immovable by reason of purpose and not by attachment;
should be essential and principal elements of the industry or work carried out, not merely incidental

immovable by destination;
must be placed by the owner of the land;
if not placed by owner, may still be immovable if attachment is of a permanent character thus becomes a
construction adhered to the soil

fertilizers must be used on land, not merely kept in farmhouse

immovable as long as the matter thereof remains unsevered form the soil

immovable as long as they are intended by their nature and object to remain at a fixed place on a river,
lake, or coast

property extends to rights provided that the same is patrimonial in nature;
real rights (power belonging to a person over a specific thing, without a passive subject individually
determined against whom such right may be personally exercised; enforceable against the whole world);
personal rights (power belonging to one person to demand of another, as a definite passive subject, the
fulfilment of a prestation to give, to do or not to do)
Concept of Real Property in Real Estate Taxation:

in real property taxation, the classification of property for taxation purposes is not the exclusive domain of
the Civil Code, especially in borderline cases where the provisions of existing tax laws were primarily
applied; in these cases, the property involved is usually either machinery or improvements
Machinery:
if “essential” or “necessary” to the operation of the business or industry then classified as realty subject to
real property tax, even if the other requirements of Par 5 Art 415 may not be present
Improvements:
depend upon the degree of permanence intended in its construction and use;
permanent does not mean that improvement has to be perpetually used but only until the purpose to which
the principal realty is devoted has been accomplished;
structure must be such that it enhances the value and utility of the property to which it is annexed;
1. Enhances value and utility and 2. Installed with some degree of permanence
CASE PRINCIPLES:
LEUNG YEE VS STRONG MACHINERY

Issue:
Whether or not the trial judge erred in sustaining the machinery company on the ground that it had its title
to the building registered prior to the date of registry of plaintiff’s certificate.
Held:
We conclude that the ruling in favor of the machinery company cannot be sustained on the ground
assigned by the trial judge. We are of opinion, however, that the judgment must be sustained on the ground
that the agreed statement of facts in the court below discloses that neither the purchase of the building by
the plaintiff nor his inscription of the sheriff’s certificate of sale in his favor was made in good faith, and that
the machinery company must be held to be the owner of the property Article 1544 of the New Civil Code, it
appearing that the company first took possession of the property; and further, that the building and the land
were sold to the machinery company long prior to the date of the sheriff’s sale to the plaintiff. But it
appearing that he had full knowledge of the machinery company’s claim of ownership when he executed
the indemnity bond and bought in the property at the sheriff’s sale, and it appearing further that the
machinery company’s claim of ownership was well founded, he cannot be said to have been an innocent
purchaser for value. He took the risk and must stand by the consequences; and it is in this sense that we
find that he was not a purchaser in good faith.
The decision of the trial court is hereby affirmed.
STANDARD OIL CORP VS JARANILLO

Position taken by the respondent is untenable. His duties are mainly ministerial only in nature
and no law confers upon him any judicial or quasi-judicial power. Generally, he should accept
the qualification of the property adopted by the person who presents the instrument for
registration and should place the instrument on record, upon payment of the proper fee, leaving the
effects of registration to be determined by the court if such question should arise for legal determination.
The Civil Code supplies no absolute criterion in discriminating between real property and personal
property for purposes of the application of the Chattel Mortgage Law. The articles state general
doctrines, nonetheless, it must not be forgotten that under given conditions, property may have
character different from that imputed to it in the said articles. It is undeniable that the parties in
a contract may by agreement treat as personal property that which by nature would be real propert
In Leung Yee vs. Frank L. Strong Machinery Co. and Williamson (37 Phil., 644), this court held that where
the interest conveyed is of the nature of real, property, the placing of the document on record in the chattel
mortgage register is a futile act; but that decision is not decisive of the question now before us, which has
reference to the function of the register of deeds in placing the document on record.
DAVAO SAWMILL VS CASTILLO

As connecting up with the facts, it should further be explained that the Davao Saw Mill Co., Inc., has on a
number of occasions treated the machinery as personal property by executing chattel mortgages in favor of
third persons. One of such persons is the appellee by assignment from the original mortgages.
Article 334, paragraphs 1 and 5, of the Civil Code, is in point. According to the Code, real property consists
of
1. Land, buildings, roads and constructions of all kinds adhering to the soil;
5. Machinery, liquid containers, instruments or implements intended by the owner of any building or land for
use in connection with any industry or trade being carried on therein and which are expressly adapted to
meet the requirements of such trade of industry.
Appellant emphasizes the first paragraph, and appellees the last mentioned paragraph. We entertain no
doubt that the trial judge and appellees are right in their appreciation of the legal doctrines flowing from the
facts. The judgment appealed from is hereby affirmed.
Machinery which is movable in its nature only becomes immobilized when placed in a plant by the owner of
the property or plant, but not when so placed by a tenant, a usufructuary, or any person having only a
temporary right, unless such person acted as the agent of the owner.
MAKATI LEASING AND FINANCE CORP VS WEAREVER TEXTILE MILLS INC

The next and the more crucial question to be resolved in this Petition is whether the machinery in suit is
real or personal property from the point of view of the parties, with petitioner arguing that it is a personality,
while the respondent claiming the contrary.
If a house of strong materials, like what was involved in the above Tumalad case, may be considered as
personal property for purposes of executing a chattel mortgage thereon as long as the parties to the
contract so agree and no innocent third party will be prejudiced thereby, there is absolutely no reason why
a machinery, which is movable in its nature and becomes immobilized only by destination or purpose, may
not be likewise treated as such. This is really because one who has so agreed is estopped from denying
the existence of the chattel mortgage.
It must be pointed out that the characterization of the subject machinery as chattel by the private
respondent is indicative of intention and impresses upon the property the character determined by the
parties. As stated in Standard Oil Co. of New York v. Jaramillo, it is undeniable that the parties to a contract
may by agreement treat as personal property that which by nature would be real property, as long as no
interest of third parties would be prejudiced thereby.
MINDANAO BUS COMPANY VS CITY ASSESSOR

Facts:
Respondent City Assessor of Cagayan de Oro City assessed at P4,400 petitioner’s above-mentioned
equipment. Petitioner appealed the assessment to the respondent Board of Tax Appeals on the ground that
the same are not realty. The Board of Tax Appeals of the City sustained the city assessor, so petitioner
herein filed with the Court of Tax Appeals a petition for the review of the assessment. The Court of Tax
Appeals having sustained the respondent city assessor’s ruling, and having denied a motion for
reconsideration, petitioner brought the case to this Court.
Issue:
Whether or not the Tax Court erred in its interpretation of paragraph 5 of Article 415 of the New Civil Code,
and holding that pursuant thereto the movable equipments are taxable realties, by reason of their being
intended or destined for use in an industry.
Held:
The law that governs the determination of the question at issue is as follows:
Art. 415. The following are immovable property:
xxx xxx xxx
(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; (Civil Code of the Phil.)
Aside from the element of essentiality the above-quoted provision also requires that the industry or works
be carried on in a building or on a piece of land. Thus in the case of Berkenkotter vs. Cu Unjieng, supra,
the “machinery, liquid containers, and instruments or implements” are found in a building constructed on
the land. A sawmill would also be installed in a building on land more or less permanently, and the sawing
is conducted in the land or building. But in the case at bar the equipments in question are destined only to
repair or service the transportation business, which is not carried on in a building or permanently on a piece
of land, as demanded by the law. Said equipments may not, therefore, be deemed real property.
Resuming what we have set forth above, we hold that the equipments in question are not absolutely
essential to the petitioner’s transportation business, and petitioner’s business is not carried on in a building,
tenement or on a specified land, so said equipment may not be considered real estate within the meaning
of Article 415 (c) of the Civil Code.
WHEREFORE, the decision subject of the petition for review is hereby set aside and the equipment in
question declared not subject to assessment as real estate for the purposes of the real estate tax.
CALTEX PHILS INC VS CENTRAL BOARD OF ASSESSMENT APPEALS

The issue is whether the pieces of gas station equipment and machinery already enumerated are subject to
realty tax. This issue has to be resolved primarily under the provisions of the Assessment Law and the Real
Property Tax Code.
Section 2 of the Assessment Law provides that the realty tax is due "on real property, including
land, buildings, machinery, and other improvements" not specifically exempted in section 3 thereof.
This provision is reproduced with some modification in the Real Property Tax Code which provides:
SEC. 38. Incidence of Real Property Tax.— There shall be levied, assessed and collected in all
provinces, cities and municipalities an annual ad valorem tax on real property, such as land, buildings,
machinery and other improvements affixed or attached to real property not hereinafter specifically
exempted.
The Code contains the following definitions in its section 3:
k) Improvements — is a valuable addition made to property or an amelioration in its condition,
amounting to more than mere repairs or replacement of waste, costing labor or capital and
intended to enhance its value, beauty or utility or to adapt it for new or further purposes.
m) Machinery — shall embrace machines, mechanical contrivances, instruments, appliances
and apparatus attached to the real estate. It includes the physical facilities available for production,
as well as the installations and appurtenant service facilities, together with all other equipment
designed for or essential to its manufacturing, industrial or agricultural purposes (See sec. 3[f],
Assessment Law).
We hold that the said equipment and machinery, as appurtenances to the gas station building or shed
owned by Caltex (as to which it is subject to realty tax) and which fixtures are necessary to the operation of
the gas station, for without them the gas station would be useless, and which have been attached or affixed
permanently to the gas station site or embedded therein, are taxable improvements and machinery within
the meaning of the Assessment Law and the Real Property Tax Code.
Improvements on land are commonly taxed as realty even though for some purposes they might be
considered personalty. "It is a familiar phenomenon to see things classed as real property for purposes of
taxation which on general principle might be considered personal property"
MANILA ELECTRIC COMPANY VS CBAA

This is a case involving 2 storage tanks. The Court held that the imposition of real tax was proper even if
the storage tanks were not embedded in land. The court recognized that this was a borderline case which
could not be decided solely on the basis of Art 415 but by the pertinent provisions of the Assessment Law
and the Real Property Tax Code. The tanks were considered as improvements on the land because 1) they
enhanced its utility and rendered it useful to the oil industry and 2) they have been installed with some
degree of permanence as receptacles for the considerable quantities of oil needed by MERALCO for its
operations.
MOVABLE PROPERTY
Movable Property:
no definition under the law, only enumeration;
general – all things susceptible of appropriation which can be transported from place to place without
impairment of the real property to which they are fixed and not included in the enumeration in Art 415;
exception, forces of nature are movable property if brought under the control of man through the help of
science, thereby becoming appropriable
General Test of Movable Character:

susceptibility to appropriation (capable of being owned or possessed)
Consumables: movable which cannot be used in a manner appropriate to its nature without itself being
consumed; e.g. cigarette
Non-Consumables: movable which can be used in a manner appropriate to its nature without itself being
consumed; e.g. table
Fungible: if, by intention of the parties, it can be replaced by another of the same kind
Non-Fungible: if, by intention of the parties, it cannot be replaced by another of the same kind
CASE PRINCIPLES:
UNITED STATES VS IGNACIO CARLOS

Issue:
Whether or not electrical energy may be stolen
Held:
This Court cited the case of U. S. vs. Genato, where the accused was also charged of using a jumper. The
Court in that case held that “Even without them (ordinances), the right of ownership of electric current is
secured by articles 517 and 518 of the Penal Code; the application of these articles in case of subtraction
of gas, a fluid used for lighting, and in some respects resembling electricity, is confirmed by the rule laid
down in the decisions of the supreme court of Spain January 20, 1887, and April 1, 1897, construing and
enforcing the provisions of articles 530 and 531 of the penal code of that country, articles identical with
articles 517 and 518 of the code in force in these Islands.”
Article 517 of the Penal Code above referred to reads as follows:
The following are guilty of larceny:
(1) Those who with intent of gain and without violence or intimidation against the person, or force
against things, shall take another's personal property without the owner's consent.
And article 518 fixes the penalty for larceny in proportion to the value of the personal property stolen.
It is true that electricity is no longer, as formerly, regarded by electricians as a fluid, but its manifestation
and effects, like those of gas, may be seen and felt. The true test of what is a proper subject of larceny
seems to be not whether the subject is corporeal, but whether it is capable of appropriation by another than
the owner.
It is well-settled that illuminating gas may be the subject of larceny, even in the absence of a statute so
providing.
In the case of Commonwealth vs. Shaw, “There is nothing in the nature of gas used for illuminating
purposes which renders it incapable of being feloniously taken and carried away. It is a valuable article of
merchandise, bought and sold like other personal property, susceptible of being severed from a mass or
larger quantity, and of being transported from place to place.”
Electricity, the same as gas, is a valuable article of merchandise, bought and sold like other personal
property and is capable of appropriation by another. So no error was committed by the trial court in holding
that electricity is a subject of larceny.
LUIS MARCOS LAUREL VS HON ZEUS ABROGAR

Held:
This Court, in United States v. Genato, United States v. Carlos, and United States v. Tambunting,
consistently ruled that any personal property, tangible or intangible, corporeal or incorporeal, capable of
appropriation can be the object of theft.
The term "personal property" in the Revised Penal Code should be interpreted in the context of the Civil
Code provisions. any property which is not included in the enumeration of real properties under the Civil
Code and capable of appropriation can be the subject of theft under the Revised Penal Code.
The only requirement for a personal property to be the object of theft under the penal code is that it be
capable of appropriation. It need not be capable of "asportation," which is defined as "carrying
away."7 Jurisprudence is settled that to "take" under the theft provision of the penal code does not require
asportation or carrying away.
appropriation of forces of nature which are brought under control by science such as electrical energy can
be achieved by tampering with any apparatus used for generating or measuring such forces of nature,
wrongfully redirecting such forces of nature from such apparatus, or using any device to fraudulently obtain
such forces of nature.
As early as 1910, the Court declared in Genato that ownership over electricity (which an international long
distance call consists of), as well as telephone service, is protected by the provisions on theft of the Penal
Code.
Interest in business was not specifically enumerated as personal property in the Civil Code in force at the
time the above decision was rendered. Yet, interest in business was declared to be personal property since
it is capable of appropriation and not included in the enumeration of real properties. 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. Business is likewise not enumerated as personal property under the Civil
Code. Just like interest in business, however, it may be appropriated. Following the ruling in Strochecker v.
Ramirez, business should also be classified as personal property. Since it is not included in the exclusive
enumeration of real properties under Article 415, it is therefore personal property.
Note: The acts of "subtraction" include: (a) tampering with any wire, meter, or other apparatus installed or
used for generating, containing, conducting, or measuring electricity, telegraph or telephone service; (b)
tapping or otherwise wrongfully deflecting or taking any electric current from such wire, meter, or other
apparatus; and (c) using or enjoying the benefits of any device by means of which one may fraudulently
obtain any current of electricity or any telegraph or telephone service.
PROPERTY IN RELATION TO THE PERSON TO WHOM IT BELONGS
PROPERTY OF PUBLIC DOMINION
Public Dominion:
1) 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) belongs to the State, without being for
public use, and are intended for some public service or for the development of the national wealth (Art 420)
Characteristics of Properties of Public Dominion:

1) outside the commerce of man (cannot be alienated or leased or be the subject matter of contracts;
except, State may enter into co-production, joint venture or production-sharing agreements with private
individuals or corporations with respect to natural resources for their exploration, development, utilization;
fishponds may be leased but not alienated;
2) not susceptible to private appropriation and acquisitive prescription (cannot be registered under the Land
Registration Law and be the subject of a Torrens Title);
3) not subject to attachment or execution (any encumbrance, levy on execution or auction sale is void for
being contrary to public policy);
4) cannot be burdened with voluntary easements
Doctrine of Equitable Estoppel (against the Government)
CASE PRINCIPLES:
ESTATE OF YUJUICO VS REPUBLIC OF THE PHILIPPINES

Held:
(1) Is a reversion suit proper in this case?
An action for reversion seeks to restore public land fraudulently awarded and disposed of to private
individuals or corporations to the mass of public domain. It is provided under Commonwealth Act (CA) No.
141
recognized the power of the state to recover lands of public domain.
Upon effectivity of Batas Pambansa (BP) Blg. 129, the Intermediate Appellate Court are given the exclusive
original jurisdiction over actions for annulment of judgments of RTCs. When the 1997 Rules of Civil
Procedure became effective on July 1, 1997, it incorporated Rule 47 on annulment of judgments or final
orders and resolutions of the RTCs. The two grounds for annulment under Sec. 2, Rule 47 are extrinsic
fraud and lack of jurisdiction.
Thus, effective July 1, 1997, any action for reversion of public land instituted by the Government was
already covered by Rule 47.
It is clear therefore that the reversion suit was erroneously instituted in the Parañaque RTC and should
have been dismissed for lack of jurisdiction. The proper court is the CA which is the body mandated by BP
Blg. 129 and prescribed by Rule 47 to handle annulment of judgments of RTCs.
(2) Is the present petition estopped by laches?
Laches is the failure or neglect, for an unreasonable and unexplained length of time, to do that which by
exercising due diligence could or should have been done earlier. It is negligence or omission to assert a
right within a reasonable time, warranting a presumption that the party entitled thereto has either
abandoned or declined to assert it.
The lapse of almost three decades in filing the instant case, the inexplicable lack of action of the Republic
and the injury this would cause constrain us to rule for petitioners. While it may be true that estoppel does
not operate against the state or its agents, deviations have been allowed. In Manila Lodge No. 761 v. Court
of Appeals, we said: “Nevertheless, the government must not be allowed to deal dishonorably or
capriciously with its citizens, and must not play an ignoble part or do a shabby thing; and subject to
limitations x x x, the doctrine of equitable estoppel may be invoked against public authorities as well as
against private individuals.”
Equitable estoppel may be invoked against public authorities when as in this case, the lot was already
alienated to innocent buyers for value and the government did not undertake any act to contest the title for
an unreasonable length of time.
In Republic v. Court of Appeals, we ruled that “it is only fair and reasonable to apply the equitable principle
of estoppel by laches against the government to avoid an injustice to innocent purchasers for value.”
Considering that innocent purchaser for value Yujuico bought the lot in 1974, and more than 27 years had
elapsed before the action for reversion was filed, then said action is now barred by laches.
While the general rule is that an action to recover lands of public domain is imprescriptible, said right can
be barred by laches or estoppel. Section 32 of PD 1592 recognized the rights of an innocent purchaser for
value over and above the interests of the government.
SEC. 32. Review of decree of registration; Innocent purchaser for value.—The decree of registration shall
not be reopened or revised by reason of absence, minority, or other disability of any person adversely
affected thereby, nor by any proceeding in any court for reversing judgments, subject, however, to the right
of any person, including the government and the branches thereof, deprived of land or of any estate or
interest therein by such adjudication or confirmation of title obtained by actual fraud, to file in the proper
Court of First Instance a petition for reopening and review of the decree of registration not later than one
year from and after the date of the entry of such decree of registration, but in no case shall such petition be
entertained by the court where an innocent purchaser for value has acquired the land or an interest therein,
whose rights may be prejudiced. Whenever the phrase “innocent purchaser for value” or an equivalent
phrase occurs in this Decree, it shall be deemed to include an innocent lessee, mortgagee, or other
encumbrances for value.
There is no allegation that Yujuico was a buyer in bad faith, nor did he acquire the land fraudulently. He
thus had the protection of the Torrens System that every subsequent purchaser of registered land taking a
certificate of title for value and in good faith shall hold the same free from all encumbrances except those
noted on the certificate and any of the x x x encumbrances which may be subsisting.[26] The same legal
shield redounds to his successors-in-interest, the Yujuicos and Carpio, more particularly the latter since
Carpio bought the lot from Jesus Y. Yujuico for value and in good faith.
(3) Did the CA erroneously apply the principle of res judicata?
We find that the instant action for reversion is already barred by res judicata.
In Romero v. Tan,[33] we ruled that “a judicial compromise has the effect of res judicata.” We also made
clear that a judgment based on a compromise agreement is a judgment on the merits, wherein the parties
have validly entered into stipulations and the evidence was duly considered by the trial court that approved
the agreement. In the instant case, the May 18, 1998 Resolution approving the compromise agreement
confirmed the favorable decision directing the registration of the lot to Castro’s name.
For res judicata to serve as an absolute bar to a subsequent action, the following requisites must concur:
(1) there must be a final judgment or order; (2) the court rendering it must have jurisdiction over the subject
matter and the parties; (3) it must be a judgment or order on the merits; and (4) there must be between the
two cases, identity of parties, subject matter and causes of action.
The threshold question pertains to the second requisite, whether or not the then Pasig-Rizal CFI had
jurisdiction over the subject matter.
Jurisdiction over the subject matter is conferred by law.[39] Consequently, the proper CFI (now the RTC)
under Section 14 of PD 1529[40] (Property Registration Decree) has jurisdiction over applications for
registration of title to land. Conformably, the Pasig-Rizal CFI, Branch XXII has jurisdiction over the subject
matter of the land registration case filed by Fermina Castro, petitioners’ predecessor-in-interest, since
jurisdiction over the subject matter is determined by the allegations of the initiatory pleading¾the
application.[41] Settled is the rule that “the authority to decide a case and not the decision rendered therein
is what makes up jurisdiction. When there is jurisdiction, the decision of all questions arising in the case is
but an exercise of jurisdiction.”
In Municipality of Antipolo v. Zapanta, the land registration court initially has jurisdiction over the land
applied for at the time of the filing of the application. After trial, the court, in the exercise of its jurisdiction,
can determine whether the title to the land applied for is registrable and can be confirmed. In the event that
the subject matter of the application turns out to be inalienable public land, then it has no jurisdiction to
order the registration of the land and perforce must dismiss the application. Based on our ruling in Antipolo,
the threshold question is whether the land covered by the titles of petitioners is under water and forms part
of Manila Bay at the time of the land registration application in 1974. If the land was within Manila Bay,
then res judicata does not apply. Otherwise, the decision of the land registration court is a bar to the
instant reversion suit.
After a scrutiny of the case records and pleadings of the parties, we rule that the land of Fermina Castro is
registrable and not part of Manila Bay at the time of the filing of the land registration application (based
upon ocular inspections conducted at that time by the land inspector and geodetic engineer).
Furthermore, the fact that PEA signed the May 15, 1998 Compromise Agreement is already a clear
admission that it recognized petitioners as true and legal owners of the land subject of this controversy.
IN SUM, the Court finds that the reversion case should be dismissed for lack of jurisdiction on the part of
the Parañaque RTC. Even if we treat said case as a petition for annulment of judgment under Rule 47 of
the 1997 Rules of Civil Procedure, the dismissal of the case nevertheless has to be upheld because it is
already barred by laches. Even if laches is disregarded, still the suit is already precluded by res judicata in
view of the peculiar facts and circumstances obtaining therein.
LAND BANK OF THE PHILS VS REPUBLIC OF THE PHILS

Held:
LBP has no valid and subsisting mortgagee's interest over the land
The contention that LBP has an interest over the subject land as a mortgagee has no merit. The mortgagor,
Lourdes Farms, Inc. from which LBP supposedly obtained its alleged interest has never been the owner of
the mortgaged land. Acquisition of the subject land by Lourdes Farms, Inc. is legally impossible as the land
was released as alienable and disposable only on March 25, 1981. Hence, LBP acquired no rights over the
land. Under Article 2085 of the Civil Code, it is essential that the mortgagor be the absolute owner of the
thing mortgaged.
As correctly pointed out by the OSG, mortgagees of non-disposable lands, titles to which were erroneously
issued, acquire no protection under the Land Registration Law.
Even assuming that LBP was able to obtain its own TCT over the property by means of its mortgage
contract with Lourdes Farms, Inc., the title must also be cancelled as it was derived from OCT No. P-2823
which was not validly issued to Bugayong. Forest lands cannot be owned by private persons. It is not
registerable whether the title is a Spanish title or a Torrens title. It is well settled that a certificate of title is
void when it covers property of public domain classified as forest or timber or mineral land. Any title issued
covering non-disposable lots even in the hands of an alleged innocent purchaser for value shall be
cancelled.
Contrary to the argument of LBP, since the title is void, it could not have become incontrovertible. Even
prescription may not be used as a defense against the Republic. Citing Republic v. Court of Appeals, it was
held that “it is basic that prescription does not run against the State. Public land fraudulently included in
patents or certificates of title may be recovered or reverted to the State in accordance with Section 101 of
the Public Land Act. Prescription does not lie against the State in such cases for the Statute of Limitations
does not run against the State. The right of reversion or reconveyance to the State is not barred by
prescription.”
There is no impairment of contract but a valid exercise of police power of the State.
The constitutional guarantee of non-impairment of contracts may not likewise be used by LBP to validate its
interest over the land as mortgagee. The State's restraint upon the right to have an interest or ownership
over forest lands does not violate the constitutional guarantee of non-impairment of contracts. Said restraint
is a valid exercise of the police power of the State.
In the case of Director of Forestry v. Muñoz, it was held that: “Because of the importance of forests to the
nation, the State's police power has been wielded to regulate the use and occupancy of forest and forest
reserves. xxx Mr. Justice Laurel declared that "the state in order to promote the general welfare may
interfere with personal liberty, with property, and with business and occupations" and that "[p]ersons and
property may be subjected to all kinds of restraints and burdens, in order to secure the general comfort,
health, and prosperity of the state.” Recently, we quoted from leading American case, which pronounced
that "neither property rights nor contract rights are absolute; for government cannot exist if the citizen may
at will use his property to the detriment of his fellows, or exercise his freedom of contract to work them
harm," and that, therefore, "[e]qually fundamental with the private right is that of the public to regulate it in
the common interest."
Preservation of our forest lands could entail intrusion upon contractual rights as in this case but it is justified
by the Latin maxims Salus populi est suprema lex and Sic utere tuo ut alienum non laedas, which call for
the subordination of individual interests to the benefit of the greater number.56
While We sympathize with petitioner, We nonetheless cannot, in this instance, yield to compassion and
equity. The rule must stand no matter how harsh it may seem.
DENR VS MAYOR YAP

Issue:
Whether private claimants (respondents-claimants in G.R. No. 167707 and petitioners-claimants in G.R.
No. 173775) have a right to secure titles over their occupied portions in Boracay. The twin petitions pertain
to their right, if any, to judicial confirmation of imperfect title under CA No. 141, as amended.
Held:
Regalian Doctrine and power of the executive to reclassify lands of the public domain
The Regalian Doctrine dictates that all lands of the public domain belong to the State, that the State is the
source of any asserted right to ownership of land and charged with the conservation of such patrimony.
Necessarily, it is up to the State to determine if lands of the public domain will be disposed of for private
ownership. The government, as the agent of the state, is possessed of the plenary power to determine who
shall be the favored recipients of public lands and the terms of such privilege.
Our present land law traces its roots to the Regalian Doctrine. Upon the Spanish conquest of the
Philippines, ownership of all lands, territories and possessions in the Philippines passed to the Spanish
Crown. The doctrine was first introduced by Laws of the Indies and the Royal Cedulas, which laid the
foundation that “all lands that were not acquired from the Government, either by purchase or by grant,
belong to the public domain.” This was followed by the Ley Hipotecaria or the Mortgage Law of 1893, which
provided for the systematic registration of titles and deeds as well as possessory claims. The Maura Law
partly amended the Spanish Mortgage Law and the Laws of the Indies. It states that possessory
information title when duly inscribed in the Registry of Property, is converted into a title of ownership only
after the lapse of 20 years of uninterrupted possession which must be actual, public, and adverse from the
date of its inscription. However, it had to be perfected one year after the promulgation of the Maura Law (or
until 1895) or the lands would revert to the State.
The first law governing the disposition of public lands in the Philippines under American rule was embodied
in the Philippine Bill of 1902. Under this law, lands of the public domain in the Philippine Islands were
classified into 3: agricultural, mineral, and timber or forest lands. Agricultural lands were interpreted to be
those public lands acquired from Spain which are not timber or mineral lands.
On 1903, the Philippine Legislature passed Act No. 496, otherwise known as the Land Registration Act.
The act established a system of registration by which recorded title becomes absolute, indefeasible, and
imprescriptible. This is known as the Torrens system.
Concurrently Act No. 926, which was the first Public Land Act, was passed. Under the Act, open,
continuous, exclusive, and notorious possession and occupation of agricultural lands for the next ten (10)
years preceding July 26, 1904 was sufficient for judicial confirmation of imperfect title.
On 1919, Act No. 926 was superseded by Act No. 2874, otherwise known as the second Public Land Act.
For judicial confirmation of title, possession and occupation en concepto dueño since time immemorial, or
since July 26, 1894, was required.
After the passage of the 1935 Constitution, CA No. 141 amended Act No. 2874 on 1936 and, as amended,
remains as the existing general law governing the classification and disposition of lands of the public
domain. The law retained the requirement under Act No. 2874 of possession and occupation of lands of the
public domain since time immemorial or since July 26, 1894. However, this provision was superseded by
RA 1942, which provided for a simple thirty-year prescriptive period for judicial confirmation of imperfect
title. The provision was last amended by PD No. 1073, which now provides for possession and occupation
of the land applied for since June 12, 1945, or earlier.
PD No. 892, issued on 1976, discontinued the use of Spanish titles as evidence in land registration
proceedings.
On 1978, Act No. 496 was amended and updated by PD No. 1529, known as the Property Registration
Decree. It was enacted to codify the various laws relative to registration of property.[78] It governs
registration of lands under the Torrens system as well as unregistered lands, including chattel mortgages.
A positive act declaring land as alienable and disposable is required.
To prove that the land subject of an application for registration is alienable, the applicant must establish the
existence of a positive act of the government such as a presidential proclamation or an executive order; an
administrative action; investigation reports of Bureau of Lands investigators; and a legislative act or a
statute.
The burden of proof in overcoming the presumption of State ownership of the lands of the public domain is
on the person applying for registration.
In the case at bar, no such proclamation, executive order, administrative action, report, statute, or
certification was presented to the Court.
Ankron and De Aldecoa did not make the whole of Boracay Island, or portions of it, agricultural lands.
There is a statement in these old cases that “in the absence of evidence to the contrary, that in each case
the lands are agricultural lands until the contrary is shown.”
These cases did not have the effect of converting the whole of Boracay Island or portions of it into
agricultural lands.
Ankron and De Aldecoa were decided at a time when the President of the Philippines had no power to
classify lands of the public domain into mineral, timber, and agricultural. At that time, the courts were free
to make corresponding classifications in justiciable cases. To aid the courts in resolving land registration
cases under Act No. 926, it was then necessary to devise a presumption on land classification. Thus
evolved the dictum in Ankron that “the courts have a right to presume, in the absence of evidence to the
contrary, that in each case the lands are agricultural lands until the contrary is shown.” By no stretch of
imagination did the presumption convert all lands of the public domain into agricultural lands.
Since 1919, courts were no longer free to determine the classification of lands from the facts of each case,
except those that have already became private lands. It is the Executive Department, through the
President, which has the exclusive prerogative to classify or reclassify public lands into alienable or
disposable, mineral or forest.
Private claimants’ continued possession under Act No. 926 does not create a presumption that the land is
alienable.
It is plain error for petitioners to argue that under the Philippine Bill of 1902 and Public Land Act No. 926,
mere possession by private individuals of lands creates the legal presumption that the lands are alienable
and disposable.
Except for lands already covered by existing titles, Boracay was an unclassified land of the public domain
prior to Proclamation No. 1064. Such unclassified lands are considered public forest under PD No. 705.
The DENR[109] and the National Mapping and Resource Information Authority[110] certify that Boracay
Island is an unclassified land of the public domain.
PD No. 705 issued by President Marcos categorized all unclassified lands of the public domain as public
forest, defined as “a mass of lands of the public domain which has not been the subject of the present
system of classification for the determination of which lands are needed for forest purpose and which are
not.”
That the occupants of Boracay have built multi-million peso beach resorts on the island;[111] that the island
has already been stripped of its forest cover; or that the implementation of Proclamation No. 1064 will
destroy the island’s tourism industry, do not negate its character as public forest. The classification of a
forest as a land of public domain is descriptive of its legal nature or status and does not have to be
descriptive of what the land actually looks like.
Private claimants cannot rely on Proclamation No. 1801 as basis for judicial confirmation of imperfect title.
The proclamation did not convert Boracay into an agricultural land.
There is nothing in the law which made Boracay Island an agricultural land.
If President Marcos intended to classify the island as alienable and disposable or forest, or both, he would
have identified the specific limits of each, as President Arroyo did in Proclamation No. 1064. This was not
done in Proclamation No. 1801.
It was Proclamation No. 1064 of 2006 which positively declared part of Boracay as alienable and opened
the same to private ownership.
Sections 6 and 7 of CA No. 141[120] provide that it is only the President, upon the recommendation of the
proper department head, who has the authority to classify the lands of the public domain into alienable or
disposable, timber and mineral lands.
President Gloria Macapagal-Arroyo merely exercised the authority granted to her to classify lands of the
public domain, presumably subject to existing vested rights. Classification of public lands is the exclusive
prerogative of the Executive Department, through the Office of the President. Courts have no authority to
do so.
Proclamation No. 1064 does not violate the Comprehensive Agrarian Reform Law.
That Boracay Island was classified as a public forest under PD No. 705 did not bar the Executive from later
converting it into agricultural land. Boracay Island still remained an unclassified land of the public domain
despite PD No. 705.
Moreover, the prohibition under the CARL applies only to a “reclassification” of land. If the land had never
been previously classified, as in the case of Boracay, there can be no prohibited reclassification under the
agrarian law.
Private claimants are not entitled to apply for judicial confirmation of imperfect title under CA No. 141.
Neither do they have vested rights over the occupied lands under the said law.
There are two requisites for judicial confirmation of imperfect or incomplete title under CA No. 141, namely:
(1) open, continuous, exclusive, and notorious possession and occupation of the subject land by himself or
through his predecessors-in-interest under a bona fide claim of ownership since time immemorial or from
June 12, 1945; and (2) the classification of the land as alienable and disposable land of the public domain.
As discussed, the Philippine Bill of 1902, Act No. 926, and Proclamation No. 1801 did not convert portions
of Boracay Island into an agricultural land. The island remained an unclassified land of the public domain
and, applying the Regalian doctrine, is considered State property.
Private claimants’ bid for judicial confirmation of imperfect title must fail because of the absence of the
second element of alienable and disposable land. Where the land is not alienable and disposable,
possession of the land, no matter how long, cannot confer ownership or possessory rights.
Neither may private claimants apply for judicial confirmation of imperfect title under Proclamation No. 1064,
with respect to those lands which were classified as agricultural lands. Private claimants failed to prove the
first element of open, continuous, exclusive, and notorious possession of their lands in Boracay since June
12, 1945.
All is not lost, however, for private claimants. For one thing, those with lawful possession may claim good
faith as builders of improvements. They can take steps to preserve or protect their possession. For
another, they may look into other modes of applying for original registration of title, such as by
homestead[131] or sales patent,[132] subject to the conditions imposed by law. More realistically,
Congress may enact a law to entitle private claimants to acquire title to their occupied lots or to exempt
them from certain requirements under the present land laws. There is one such bill[133] now pending in
the House of Representatives. Whether that bill or a similar bill will become a law is for Congress to decide.
Prescription as a mode to acquire ownership over public agricultural lands

CASE PRINCIPLE:
HEIRS OF MARIO MALABANAN VS REPUBLIC OF THE PHILIPPINES

Issues:
1. Should the land be classified as alienable and disposable as of June 12, 1945 or is it sufficient that
such classification occur at any time prior to the filing of the applicant for registration?
2. May a parcel of land classified as alienable and disposable be deemed private land and therefore
susceptible to acquisition by prescription in accordance with the Civil Code?
3. May a parcel of land established as agricultural in character either because of its use or because its
slope is below that of forest lands be registrable in relation to the provisions of the Civil Code on acquisitive
prescription?
4. Are petitioners entitled to the registration of the subject land in their names?
Held:
Petition is denied.
1. 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.
(a) 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.
(b) The right to register granted under Section 48(b) of the Public Land Act is further confirmed by Section
14(1) of the Property Registration Decree.
2. 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, under Article 422
of the Civil Code. And only when the property has become patrimonial can the prescriptive period for the
acquisition of property of the public dominion begin to run.
(a) Patrimonial property is private property of the government. The person acquires 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 Malabanan 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.
Property of State: Public Dominion: 3 kinds (1. Intended for public use, 2. Intended for public service, 3.
Intended for development of national wealth)
Public Dominion, referring to Public Ownership: public dominion means ownership by the public in
general; ownership is a special collective ownership for the general use and enjoyment, an application to
the satisfaction of collective needs, and resides in the social group; State is the juridical representative and
as such it takes care of them, preserves them and regulates their use for the general welfare;
Public Dominion, referring to State Ownership: pubic dominion may also mean properties or things held
by the State by regalian right; regalian doctrine (all lands of the public domain as well as all natural
resources are owned by the State
Public Ownership distinguished from State Ownership: in public ownership, not even the State may
make them the object of commerce hence they cannot be leased, donated, sold or be the object of any
contract; with respect to natural resources, the State may enter into co-production, joint venture or product-
sharing agreements with private individuals or corporations for their exploration, development and
utilization; for fishponds, may be leased but not alienated
Intent to Devote, Sufficient: in order to be property or public dominion, an intention to devote it to public
use is sufficient and it is not necessary that it must actually be used as such; if the property has been
intended for such use or service, and it has not been devoted to other uses and no measures have been
adopted which amount to a withdrawal thereof from public use or service, the same remains property of
public dominion, the fact that it is not actually devoted for public use or service notwithstanding
Public Use and Public Service, Distinguished: public use (use which is not confined to privileged
individuals, but is open to the indefinite public, may be used indiscriminately by the public); public service
(although used for the benefit of the public, cannot be used indiscriminately by anyone but only by those
that are authorized by proper authority)
Property of Public Dominion:
For Public Use: roads, canals, rivers, torrents, ports and bridges constructed by the State; banks, shores,
roadsteads, and others of similar character (Art 420); in addition, Art 5 and 6 of PD 1067 or the Water Code
of the Philippines
Roads: national highways and roads constructed and maintained by the national government through the
DPWH; provincial, city and municipal roads and streets are properties of public dominion of the LGU
concerned and governed by Art 424 and the Local Govt Code
Canals: usually an artificial waterway, drainage, irrigation, or navigation; canals constructed by the State
and devoted to public use are of public ownership; canals constructed by private persons within their
private lands and devoted exclusively for private use must be of private ownership, except when the builder
lost it by prescription
River: composite term which includes 1) running waters, 2) bed, and 3) banks; the extent of the river bed is
the ground covered by its waters during the highest floods (Art 70 of the Law of Waters); banks of river are
those lateral strips or zones of it beds which are washed by the stream only during such high floods as do
not cause inundations, simply speaking it refers to the lateral lines reached by the waters when the river is
at high tide; accretions on river banks belong to the owner of lands adjoining the banks, provided that the
deposit is due to the effects of the current of the river; man-made accretions are part of the public domain
Ports: includes seaports and airports
Shores: shore is that space which is alternately covered and uncovered by water with the movements of
the tides; when the sea advances and private properties are permanently invaded by the waves, the
properties so invaded become part of the shore or beach and they then pass to the public domain (de facto
case of eminent domain, not subject to indemnity; natural expropriation); accretions and alluvial deposits
caused by the action of the sea is outside the commerce of man, unless otherwise declared by either the
executive or legislative branch of the govt
Foreshore Lands: foreshore land is that part of the land immediately in front of the shore; the part which is
between high and low water marks, and alternately covered with water and left dry by the flux and reflux of
the tides; indicated by a middle line between the highest and lowest tides; submerged lands are part of the
State’s inalienable natural resources, are property of public dominion, inalienable and outside the
commerce of man; any sale of submerged or foreshore lands is void being contrary to the Constitution
Lakes: natural lakes and lagoons and their beds are part of public dominion; lakes and lagoons naturally
occurring on private lands also belong to the State; lakes and lagoons developed by a private person on
private lands are of private ownership
Others of Similar Character: creeks (recess or arm extending form a river and participating in the ebb and
flow of the sea)
For Public Service: all properties of the State that are devoted or intended for some public service are
likewise part of the public dominion; e.g. Roponggi Property
For the Development of National Wealth: constitutes property of public dominion although employed for
some economic or commercial activity to increase the national wealth
CASE PRINCIPLES:
MUNICIPALITY OF CAVITE VS ROJAS

Issue:
Whether or not the contract of lease given to Rojas is valid
Held:
No.
By section 3 of the said Act No. 1039, passed January 12, 1904, the Philippine Commission granted to the
municipality of Cavite all the land included in the tract called Plaza Soledad.
In the case of Nicolas vs. Jose, this court decided that neither the municipality nor the objectors were
entitled to inscription, for with respect to the objectors said plaza belonged to the municipality of Cavite and
with respect to the latter the said Plaza Soledad was not transferable property of that municipality to be
inscribed in its name, because the intention of Act No. 1039 was that the said plaza and other places
therein enumerated should be kept open for public transit; therefore there can be no doubt that the
defendant has no right to continue to occupy the land of the municipality leased by her, for it is an integral
portion of Plaza Soledad, which if for public use and is reserved for the common benefit.
According to article 344 of the Civil Code: "Property for public use in provinces and in towns comprises the
provincial and town roads, the squares, streets, fountains, and public waters, the promenades, and public
works of general service supported by said towns or provinces."
The said Plaza Soledad being a promenade for public use, the municipal council of Cavite could not in
1907 withdraw or exclude from public use a portion thereof in order to lease it for the sole benefit of the
defendant Hilaria Rojas. In leasing a portion of said plaza or public place to the defendant for private use
the plaintiff municipality exceeded its authority in the exercise of its powers by executing a contract over a
thing of which it could not dispose, nor is it empowered so to do.
The Civil Code, articles 1271, prescribes that everything which is not outside he commerce of man may be
the object of a contract, and plazas and streets are outside of this commerce, as was decided by the
supreme court of Spain in its decision of February 12, 195, which says: "Communal things that cannot be
sold because they are by their very nature outside of commerce are those for public use, such as the
plazas, streets, common lands, rivers, fountains, etc."
Therefore, it must be concluded that the contract,whereby he municipality of Cavite leased to Hilaria Rojas
a portion of the Plaza Soledad is null and void and of no force or effect, because it is contrary to the law
and the thing leased cannot be the object of a contract.
MANECLANG VS IAC
ISSUE:
Whether or not the fishpond is subject to private appropriation
RULING:
The stipulations contained in the Compromise Agreement partake of the nature of an adjudication of
ownership in favor of herein petitioners of the fishpond in dispute, which, as clearly found by the lower and
appellate courts, was originally a creek forming a tributary of the Agno River. Considering that as held in
the case of Mercado vs. Municipal President of Macabebe, 59 Phil. 592 [1934], a creek, defined as a
recess or arm extending from a river and participating in the ebb and flow of the sea, is a property
belonging to the public domain which is not susceptible to private appropriation and acquisitive prescription,
and as a public water, it cannot be registered under the Torrens System in the name of any individual
[Diego v. Court of Appeals, 102 Phil. 494; Mangaldan v. Manaoag, 38 Phil. 4551; and considering further
that neither the mere construction of irrigation dikes by the National Irrigation Administration which
prevented the water from flowing in and out of the subject fishpond, nor its conversion into a fishpond, alter
or change the nature of the creek as a property of the public domain, the Court finds the Compromise
Agreement null and void and of no legal effect, the same being contrary to law and public policy.
IGNACIO VS DIRECTOR OF LANDS

The Supreme Court ruled that a property continues to be part of the public domain, not available for private
appropriation or ownership until there is a formal declaration on the part of the government, either through
the Executive Department of the Legislative, to the effect that the property is no longer needed for public
service, for public use or for special industries. Thus, either the Executive or the Legislative may convert
property of the State of public dominion into patrimonial property of the State.
PHILIPPINE FISHERIES DEVELOPMENT AUTHORITY VS CA

Issue:
Is the Authority liable to pay real property tax to the City of Iloilo?
If the answer is in the affirmative, may the IFPC be sold at public auction to satisfy the tax delinquency?
Held:
To resolve said issues, the Court has to determine (1) whether the Authority is a government owned or
controlled corporation (GOCC) or an instrumentality of the national government; and (2) whether the IFPC
is a property of public dominion.
The Court rules that the Authority is not a GOCC but an instrumentality of the national government which is
generally exempt from payment of real property tax. However, said exemption does not apply to the
portions of the IFPC which the Authority leased to private entities. With respect to these properties, the
Authority is liable to pay real property tax. Nonetheless, the IFPC, being a property of public dominion
cannot be sold at public auction to satisfy the tax delinquency.
In Manila International Airport Authority (MIAA) v. Court of Appeals, the Court held that for an entity to be
considered as a GOCC, it must either be organized as a stock or non-stock corporation. Two requisites
must concur before one may be classified as a stock corporation, namely: (1) that it has capital stock
divided into shares, and (2) that it is authorized to distribute dividends and allotments of surplus and profits
to its stockholders. If only one requisite is present, it cannot be properly classified as a stock corporation.
As for non-stock corporations, they must have members and must not distribute any part of their income to
said members.
On the basis of the parameters, the Authority should be classified as an instrumentality of the national
government. As such, it is generally exempt from payment of real property tax, except those portions which
have been leased to private entities. In the MIAA case, the Fisheries Development Authority was cited as
among the instrumentalities of the national government.
The Authority is actually a national government instrumentality which is defined as an agency of the
national government, not integrated within the department framework, vested with special functions or
jurisdiction by law, endowed with some if not all corporate powers, administering special funds, and
enjoying operational autonomy, usually through a charter.13
The MIAA case held17 that unlike GOCCs, instrumentalities of the national government, like MIAA, are
exempt from local taxes pursuant to Section 133(o) of the Local Government Code. This exemption,
however, admits of an exception with respect to real property taxes. Applying Section 234(a) of the Local
Government Code, the Court ruled that when an instrumentality of the national government grants to a
taxable person the beneficial use of a real property owned by the Republic, said instrumentality becomes
liable to pay real property tax.
In light of the foregoing, the Authority should be classified as an instrumentality of the national government
which is liable to pay taxes only with respect to the portions of the property, the beneficial use of which
were vested in private entities.
In case the Authority fails to pay the real property taxes due thereon, said portions cannot be sold at public
auction to satisfy the tax delinquency. In Chavez v. Public Estates Authority it was held that reclaimed
lands are lands of the public domain and cannot, without Congressional fiat, be subject of a sale, public
or private, thus:21
The salient provisions of CA No. 141, on government reclaimed, foreshore and marshy lands of the public
domain, are as follows:
Sec. 59. The lands disposable under this title shall be classified as follows:
(a) Lands reclaimed by the Government by dredging, filling, or other means;
(b) Foreshore;
(c) Marshy lands or lands covered with water bordering upon the shores or banks of navigable
lakes or rivers;
(d) Lands not included in any of the foregoing classes.
xxxx
Sec. 61. The lands comprised in classes (a), (b), and (c) of section fifty-nine shall be
disposed of to private parties by lease only and not otherwise, as soon as the President,
upon recommendation by the Secretary of Agriculture, shall declare that the same are not
necessary for the public service and are open to disposition under this chapter. The lands
included in class (d) may be disposed of by sale or lease under the provisions of this Act."
(Emphasis supplied)
xxxx
Since then and until now, the only way the government can sell to private parties government
reclaimed and marshy disposable lands of the public domain is for the legislature to pass a law
authorizing such sale. CA No. 141 does not authorize the President to reclassify government
reclaimed and marshy lands into other non-agricultural lands under Section 59 (d). Lands classified
under Section 59 (d) are the only alienable or disposable lands for non-agricultural purposes that
the government could sell to private parties.
In the same vein, the port built by the State in the Iloilo fishing complex is a property of the public dominion
and cannot therefore be sold at public auction. Article 420 of the Civil Code, provides:
ARTICLE 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.
WOODRIDGE SCHOOL INC VS ARB CONSTRUCTION

Issue:
Whether or not the subject subdivision road lot is property of public dominion
Held:
No.
In the case of Abellana, Sr. v. Court of Appeals,13 the Court held 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."14 Otherwise, they remain to be private properties of
the owner-developer.
The road is not converted into public property by mere tolerance of the subdivision owner of the public's
passage through it. To repeat, "the local government should first acquire them by donation, purchase, or
expropriation, if they are to be utilized as a public road."
Likewise, we hold the trial court in error when it ruled that the subject road is public property pursuant to
Section 2 of Presidential Decree No. 1216, which states that: “Upon their completion as certified to by the
Authority, the roads, alleys, sidewalks and playgrounds shall be donated by the owner or developer to the
city or municipality and it shall be mandatory for the local governments to accept them provided, however,
that the parks and playgrounds may be donated to the Homeowners Association of the project with the
consent of the city or municipality concerned…”
The law is clear. The transfer of ownership from the subdivision owner-developer to the local government is
not automatic but requires a positive act from the owner-developer before the city or municipality can
acquire dominion over the subdivision roads. Therefore, until and unless the roads are
donated,17 ownership remains with the owner-developer.
Since no donation has been made in favor of any local government and the title to the road lot is still
registered in the name of ARB, the disputed property remains private.
However, ARB may not readily exclude petitioners from passing through the property.
As correctly pointed out by the Court of Appeals, the circumstances clearly make out a case of legal
easement of right of way. 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; (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.
The appellate and trial courts found that the properties of petitioners are enclosed by other estates without
any adequate access to a public highway except the subject road lot which leads to Marcos Alvarez
Avenue.21 Although it was shown that the shortest distance from the properties to the highway is toward the
east across a creek, this alternative route does not provide an adequate outlet for the students of the
proposed school. This route becomes marshy as the creek overflows during the rainy season and will
endanger the students attending the school.
All told, the only requisite left unsatisfied is the payment of proper indemnity.
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, to award the indemnity using factors different from that given by the law is a complete disregard of
these clear statutory provisions and is evidently arbitrary.
Having settled the legal issues, we order the remand of this case to the trial court for reception of evidence
and determination of the limits of the property to be covered by the easement, the proper indemnity to be
paid and the respective contributions of petitioners.
CITY OF ANGELES VS COURT OF APPEALS
Issue:
The central issue is whether or not the donation may be revoked at all
Held:
First Issue: Developer Legally Bound to Donate Open Space
Pursuant to the wording of Sec. 31 of P.D. 957 as above amended by the aforequoted P.D. No. 1216,
private respondent is under legal obligation to donate the open space exclusively allocated for parks,
playgrounds and recreational use to the petitioner.
It will be noted that in the original provision of Sec. 31 of P.D. 957 it was optional on the part of the owner
or developer to donate the roads and spaces found within the project to the city or municipality where the
project is located. However,
It is clear from the PD 1216, which amended Sec 31 of PD 957, that it is no longer optional on the part of
the subdivision owner/developer to donate the grounds; rather there is now a legal obligation to donate the
same. Said amended paragraph states that:
“Upon their completion . . ., the roads, alleys, sidewalks and playgrounds shall be donated by the
owner or developer to the city or municipality and it shall be mandatory for the local government to
accept; provided, however, that the parks and playgrounds may be donated to the Homeowners
Association of the project with the consent of the city or must concerned…”
Although there is a proviso that the donation of the parks and playgrounds may be made to the
homeowners association of the project with the consent of the city of municipality, concerned, nonetheless,
the owner/developer is still obligated under the law to donate.
Second Issue: Percentage of Area for Parks and Playgrounds
The language of Section 31 of P.D. 957 as amended by Section 2 of P.D. 1216 is wanting in clarity and
exactitude, but it can be easily inferred that the phrase "gross area" refers to the entire subdivision area.
The phrase "30% of the gross area" refers to the total area of the subdivision, not of the open space.
Otherwise, the definition of "open space" would be circular. Thus, logic dictates that the same basis be
applied in the succeeding instances where the phrase "open space" is used, i.e., "9% of gross area... 7% of
gross area... 3.5% of gross area..." Moreover, we agree with petitioners that construing the 3.5% to 9% as
applying to the totality of the open space would result in far too small an area being devoted for parks,
playgrounds, etc., thus rendering meaningless and defeating the purpose of the statute.
Third Issue: Imposition of Conditions in Donation of Open Space
Petitioners argue that since the private respondent is required by law to donate the parks and playgrounds,
it has no right to impose the condition in the Amended Deed of Donation that "the properties donated shall
be devoted and utilized solely for the site of the Angeles City Sports Center."
However, the general law on donations does not prohibit the imposition of conditions on a donation so long
as the conditions are not illegal or impossible. There is no prohibition in either P.D. 957 or P.D. 1216
against imposing conditions on such donation.
We hold that any condition may be imposed in the donation, so long as the same is not contrary to law,
morals, good customs, public order or public policy.
In the case at bar, one of the conditions imposed in the Amended Deed of Donation is that the donee
should build a sports complex on the donated land. Since P.D. 1216 clearly requires that the 3.5% to 9% of
the gross area alloted for parks and playgrounds is "non-buildable", then the obvious question arises
whether or not such condition was validly imposed and is binding on the donee. It is clear that the "non-
buildable" character applies only to the 3.5% to 9% area set by law. If there is any excess land over and
above the 3.5% to 9% required by the decree, which is also used or allocated for parks, playgrounds and
recreational purposes, it is obvious that such excess area is not covered by the non-buildability restriction.
In the instant case, if there be an excess, then the donee would not be barred from developing and
operating a sports complex thereon, and the condition in the amended deed would then be considered
valid and binding.
The subdivision in question is a "medium-density or economic housing" subdivision based on the sizes of
the family lots donated in the amended deed, 14 for which category the decree mandates that not less than
7% of gross area be set aside. Since the donated land constitutes only a little more than 5% of the gross
area of the subdivision, which is less than the area required to be allocated for non-buildable open space,
therefore there is no "excess land" to speak of. This then means that the condition to build a sports
complex on the donated land is contrary to law and should be considered as not imposed.
Fourth Issue: Injunction vs. Construction of the Drug Rehabilitation Center
In light of Sec. 31 of P.D. 957, as amended, declaring the open space for parks, playgrounds and
recreational area as non-buildable, it appears indubitable that the construction and operation of a drug
rehabilitation center on the land in question is a continuing violation of the law and thus should be enjoined.
The fact remains that the trial court rendered judgment enjoining the construction of the drug rehabilitation
center, revoking the donation and ordering the return of the donated land. In spite of such injunction,
petitioners publicly flaunted their disregard thereof with the subsequent inauguration of the center on
August 15, 1989. The operation o the center, after inauguration, is even more censurable.
Fifth Issue: Revocation of a Mandatory Donation Because of Non-compliance With an Illegal Condition
Article 1412 of the Civil Code which provides that:
If the act in which the unlawful or forbidden cause consists does not constitute a criminal offense,
the following rules shall be observed:
(1) When the fault is on the part of both contracting parties, neither may recover what he has given
by virtue of the contract, or demand the performance of the other's undertaking;
comes into play here. Both petitioners and private respondents are in violation of P.D. 957 as amended, for
donating and accepting a donation of open space less than that required by law, and for agreeing to build
and operate a sports complex on the non-buildable open space so donated; and petitioners, for
constructing a drug rehabilitation center on the same non-buildable area.
Moreover, since the condition to construct a sport complex on the donated land has previously been shown
to be contrary to law, therefore, stipulation no. 8 of the amended deed cannot be implemented because (1)
no valid stipulation of the amended deed had been breached, and (2) it is highly improbable that the decree
would have allowed the return of the donated land for open space under any circumstance, considering the
non-alienable character of such open space, in the light of the second Whereas clause of P.D. 1216 which
declares that . . . such open spaces, roads, alleys and sidewalks in residential subdivisions are for public
use and are, therefore, beyond the commerce of men.
It is a familiar principle that the courts will not aid either party to enforce an illegal contract, but will leave
them both where they find them.
There is therefore no legal basis whatsoever to revoke the donation of the subject open space and to return
the donated land to private respondent. The donated land should remain with the donee as the law clearly
intended such open spaces to be perpetually part of the public domain, non-alienable and permanently
devoted to public use as such parks, playgrounds or recreation areas.
Removal/Demolition of Drug Rehabilitation Center
Inasmuch as the construction and operation of the drug rehabilitation center has been established to law,
the said center should be removed or demolished. It is an outright and continuing violation of the laws of
the land. The end never justifies the means, however laudable the purpose of the construction in question.
In theory, the cost of such demolition, and the reimbursement of the public funds expended in the
construction thereof, should be borne by the officials of the City Angeles who ordered and directed such
construction. This Court has time and again ruled that public officials may be liable in his personal capacity
for whatever damage he may have caused by his act done with malice and in bad faith or beyond the
scope of his authority or jurisdiction.
In the instant case, the public officials concerned deliberately violated the law and persisted in their
violations, going so far as attempting to deceive the courts by their pretended change of purpose and
usage for the enter, and "making a mockery of the judicial system". Indisputably, said public officials acted
beyond the scope of their authority and jurisdiction and with evident bad faith. However, as noted by the
trial court21, the petitioners were sued only in their official capacities, hence, they could not be held
personally liable without first giving them their day in court. Prevailing jurisprudence 22 holding that public
officials are personally liable for damages arising from illegal acts done in bad faith are premised on said
officials having been sued both in their official and personal capacities.
We believe that the fairest and most equitable solution is to have the City of Angeles, donee of the subject
open space and, ostensibly, the main beneficiary of the construction and operation of the proposed drug
rehabilitation center, undertake the demolition and removal of said center, and if feasible, recover the cost
thereof from the city officials concerned.
Foreshore lands: not subject to sale; only lease
CASE PRINCIPLE:
CHAVEZ VS PUBLIC ESTATES AUTHORITY

The ownership of lands reclaimed from foreshore and submerged areas is rooted in the Regalian doctrine
which holds that the State owns all lands and waters of the public domain. Upon the Spanish conquest of
the Philippines, ownership of all "lands, territories and possessions" in the Philippines passed to the
Spanish Crown. The King, as the sovereign ruler and representative of the people, acquired and owned all
lands and territories in the Philippines except those he disposed of by grant or sale to private individuals.
The 1935, 1973 and 1987 Constitutions adopted the Regalian doctrine substituting, however, the State, in
lieu of the King, as the owner of all lands and waters of the public domain. The Regalian doctrine is the
foundation of the time-honored principle of land ownership that "all lands that were not acquired from the
Government, either by purchase or by grant, belong to the public domain."43 Article 339 of the Civil Code
of 1889, which is now Article 420 of the Civil Code of 1950, incorporated the Regalian doctrine.
Under Section 2, Article XII of the 1987 Constitution, the foreshore and submerged areas of Manila Bay are
part of the "lands of the public domain, waters x x x and other natural resources" and consequently "owned
by the State." As such, foreshore and submerged areas "shall not be alienated," unless they are classified
as "agricultural lands" of the public domain. The mere reclamation of these areas by PEA does not convert
these inalienable natural resources of the State into alienable or disposable lands of the public domain.
There must be a law or presidential proclamation officially classifying these reclaimed lands as alienable or
disposable and open to disposition or concession. Moreover, these reclaimed lands cannot be classified as
alienable or disposable if the law has reserved them for some public or quasi-public use.
Section 8 of CA No. 141 provides that "only those lands shall be declared open to disposition or concession
which have been officially delimited and classified."72 The President has the authority to classify
inalienable lands of the public domain into alienable or disposable lands of the public domain, pursuant to
Section 6 of CA No. 141.
PD No. 1085, coupled with President Aquino's actual issuance of a special patent covering the Freedom
Islands, is equivalent to an official proclamation classifying the Freedom Islands as alienable or disposable
lands of the public domain. PD No. 1085 and President Aquino's issuance of a land patent also constitute a
declaration that the Freedom Islands are no longer needed for public service. The Freedom Islands are
thus alienable or disposable lands of the public domain, open to disposition or concession to
qualified parties.
The Amended JVA covers not only the Freedom Islands, but also an additional 592.15 hectares which are
still submerged and forming part of Manila Bay. There is no legislative or Presidential act classifying
these submerged areas as alienable or disposable lands of the public domain open to disposition.
There can be no dispute that these submerged areas form part of the public domain, and in their present
state are inalienable and outside the commerce of man.
The classification of PEA's reclaimed foreshore and submerged lands into alienable or disposable lands
open to disposition is necessary because PEA is tasked under its charter to undertake public services that
require the use of lands of the public domain.
Clearly, the mere physical act of reclamation by PEA of foreshore or submerged areas does not make the
reclaimed lands alienable or disposable lands of the public domain, much less patrimonial lands of PEA.
Likewise, the mere transfer by the National Government of lands of the public domain to PEA does not
make the lands alienable or disposable lands of the public domain, much less patrimonial lands of PEA.
Absent two official acts – a classification that these lands are alienable or disposable and open to
disposition and a declaration that these lands are not needed for public service, lands reclaimed by PEA
remain inalienable lands of the public domain. Only such an official classification and formal declaration
can convert reclaimed lands into alienable or disposable lands of the public domain, open to disposition
under the Constitution, Title I and Title III83 of CA No. 141 and other applicable laws.
There is legislative authority granted to PEA to sell its lands, whether patrimonial or alienable lands
of the public domain. PEA may sell to private parties its patrimonial properties in accordance with the
PEA charter free from constitutional limitations. The constitutional ban on private corporations from
acquiring alienable lands of the public domain does not apply to the sale of PEA's patrimonial lands.
PEA may also sell its alienable or disposable lands of the public domain to private individuals since,
with the legislative authority, there is no longer any statutory prohibition against such sales and the
constitutional ban does not apply to individuals. PEA, however, cannot sell any of its alienable or
disposable lands of the public domain to private corporations since Section 3, Article XII of the 1987
Constitution expressly prohibits such sales. The legislative authority benefits only individuals. Private
corporations remain barred from acquiring any kind of alienable land of the public domain, including
government reclaimed lands.
PATRIMONIAL PROPERTY OF THE STATE
Patrimonial Property:
all other property of the State, which is not of the character stated in Art 420 of NCC;
property of the State in what may be called the private sense: e.g friar lands (lands acquired by the
government from religious corporations or orders), alienable and disposable lands of the public domain,
lands covered by RA 7227 (public land granted to an end-user government agency for a specific public use
may subsequently be withdrawn by Congress from public use and declared patrimonial property to be sold
to private parties)
Disposition of Patrimonial Property: any conveyance of a real property falling under the patrimonial
property of the State must be authorized and approved by a law enacted by the Congress
Not Susceptible of Acquisitive Prescription:

prescription can never lie against the government;
unless the law expressly provides, a patrimonial property of the State is not subject to acquisitive
prescription;
example of law that allows acquisition of patrimonial properties of State by way of acquisitive prescription is
CA 141 which authorizes confirmation of imperfect title (only applies to alienable lands of public domain)
Conversion: From Public Dominion to Patrimonial Property:

property of public dominion, when no longer intended for public use or for public service, shall form part of
the patrimonial property of the State;
either the Executive Dept or the Legislative Dept may convert property of the State of public dominion into
patrimonial property of the State (Ignacio vs Director or Lands);
there must be an affirmative act, either on the part of executive or the legislative, to reclassify property of
the public dominion into patrimonial; intention must be clear, definite and must be based on correct legal
premise
CASE PRINCIPLES:
LAUREL VS GARCIA
The Roppongi property was acquired together with the other properties through reparation
agreements. They were assigned to the government sector and that the Roppongi property was
specifically designated under the agreement to house the Philippine embassy.
It is of public dominion unless it is convincingly shown that the property has become patrimonial.
The respondents have failed to do so.
As property of public dominion, the Roppongi lot is outside the commerce of man. It cannot be
alienated. Its ownership is a special collective ownership for general use and payment, in application
to the satisfaction of collective needs, and resides in the social group. The purpose is not to serve
the State as the juridical person but the citizens; it is intended for the common and public welfare and
cannot be the object of appropriation.
The fact that the Roppongi site has not been used for a long time for actual Embassy service doesn’t
automatically convert it to patrimonial property. Any such conversion happens only if the property is
withdrawn from public use. A property continues to be part of the public domain, not available for
private appropriation or ownership until there is a formal declaration on the part of the government to
withdraw it from being such.
CHAVEZ VS NATIONAL HOUSING AUTHORITY

FIRST ISSUE:
Whether respondents NHA and RBI have been granted the power and authority to reclaim lands of the
public domain as this power is vested exclusively in PEA as claimed by petitioner
We conclude that the President’s delegation to NHA, a national government agency, to reclaim lands under
the SMDRP, is legal and valid.
While PEA under PD 1084 has the power to reclaim land and under EO 525 is primarily responsible for
integrating, directing and coordinating reclamation projects, such authority is NOT exclusive and such
power to reclaim may be granted or delegated to another government agency or entity or may even be
undertaken by the National Government itself, PEA being only an agency and a part of the National
Government.
While PD 757, the charter of NHA, does not explicitly mention “reclamation” in any of the listed powers of
the agency, we rule that the NHA has an implied power to reclaim land as this is vital or incidental to
effectively, logically, and successfully implement an urban land reform and housing program
Even without an implied power to reclaim lands under NHA’s charter, we rule that the authority granted to
NHA, a national government agency, by the President under PD 3-A reinforced by EO 525 is more than
sufficient statutory basis for the reclamation of lands under the SMDRP
SECOND ISSUE:
Whether respondents NHA and RBI were given the power and authority by DENR to reclaim foreshore and
submerged lands
We find that the NHA is still required to procure DENR’s authorization before a reclamation project in
Manila Bay or in any part of the Philippines can be undertaken. The requirement applies to PEA, NHA, or
any other government agency or office granted with such power under the law.
DENR decides whether areas under water , like foreshore or submerged areas of Manila Bay,
should be reclaimed or not.
xxx
In short, DENR is vested with the power to authorize the reclamation of areas under water, while
PEA is vested with the power to undertake the physical reclamation of areas under water.
xxx
DENR is also empowered to classify lands of the public domain into alienable or disposable lands
subject to the approval of the President.
The DENR is deemed to have granted the authority to reclaim in the Smokey Mountain Project.
a) When the President approved and ordered the development of a housing project with the corresponding
reclamation work, making DENR a member of the committee tasked to implement the project, the required
authorization from the DENR to reclaim land can be deemed satisfied
b) Sec 2 MO 415, DENR being tasked to “facilitate the titling of the Smokey Mountain and of the area to be
reclaimed”, shows that it had tacitly given its authority to the NHA to undertake the reclamation
c) Issuance of the Special Patents
d) Issuance of ECCs by the DENR
THIRD ISSUE:
Whether respondent RBI can acquire reclaimed foreshore and submerged lands considered as inalienable
and outside the commerce of man
The reclaimed lands across R10 were classified alienable and disposable lands of public domain of the
State.
MO 415, and Proclamation Nos 39 and 465 cumulatively and jointly taken together with Special Patent Nos
3591, 3592, and 3598 more than satisfy the requirement in PEA that “there must be a law or presidential
proclamation officially classifying these reclaimed lands as alienable or disposable and open to disposition
or concession”.
The NHA is an “end-user agency”.
The moment titles over reclaimed lands based on the special patents are transferred to the NHA by the
Register of Deeds, they are automatically converted to patrimonial properties of the State which can be
sold to Filipino citizens and private corporations, 60% of which are owned by Filipinos.
It is true that, once a patent is registered and the corresponding certificate of title is issued, the land
covered by them ceases to be part of the public domain and becomes private property, and the Torrens
Title issued pursuant to the patent becomes indefeasible upon the expiration of one year from the date of
issuance of such patent.
The lands became alienable and disposable lands of public domain upon issuance of the special patents
and become patrimonial properties of the government from the time the titles are issued to the NHA.
FOURTH ISSUE:
Whether respondent RBI can acquire reclaimed lands when there was no declaration that said lands are no
longer needed for public use
MO 415 and Proclamation Nos 39 and 465 are declarations that proclaimed the non-use of the reclaimed
areas for public use or service as the Project cannot be successfully implemented without the withdrawal of
said lands form public use or service.
Reclaimed lands that are made the enabling components of a BOT infrastructure project are necessarily
reclassified as alienable and disposable lands under the BOT Law.
REMEMBER: When the titles to the reclaimed lands were transferred to the NHA, said alienable and
disposable lands of public domain were automatically classified as lands of the private domain or
patrimonial properties of the State because NHA is an agency NOT tasked to dispose of alienable or
disposable lands of public domain. Being patrimonial, then it has the power to sell the same to any qualified
person – under the Constitution, Filipino citizens as private corporations, 60 % of which is owned by Filipino
citizens like RBI.
The NHA is an end-user entity.
CEBU OXYGEN & ACETYLENE CO INC VS BERCILLES

Issue:
(1) Does the City Charter of Cebu City (Republic Act No. 3857) under Section 31, paragraph 34, give the
City of Cebu the valid right to declare a road as abandoned? and
(2) Does the declaration of the road, as abandoned, make it the patrimonial property of the City of Cebu
which may be the object of a common contract?
Held:
(1) The pertinent portions of the Revised Charter of Cebu City provides:
Section 31. Legislative Powers. Any provision of law and executive order to the contrary
notwithstanding, the City Council shall have the following legislative powers:
xxx xxx xxx
(34) ...; to close any city road, street or alley, boulevard, avenue, park or square. Property thus
withdrawn from public servitude may be used or conveyed for any purpose for which other real
property belonging to the City may be lawfully used or conveyed.
From the foregoing, it is undoubtedly clear that the City of Cebu is empowered to close a city road or street.
In the case of Favis vs. City of Baguio, the Court held that: “The city council, it would seem to us, is the
authority competent to determine whether or not a certain property is still necessary for public use. Such
power to vacate a street or alley is discretionary. And the discretion will not ordinarily be controlled or
interfered with by the courts, absent a plain case of abuse or fraud or collusion. Faithfulness to the public
trust will be presumed. So the fact that some private interests may be served incidentally will not invalidate
the vacation ordinance.”
(2) Since that portion of the city street subject of petitioner's application for registration of title was
withdrawn from public use, it follows that such withdrawn portion becomes patrimonial property which can
be the object of an ordinary contract.
Article 422 of the Civil Code expressly provides that "Property of public dominion, when no longer intended
for public use or for public service, shall form part of the patrimonial property of the State."
Besides, the Revised Charter of the City of Cebu heretofore quoted, in very clear and unequivocal terms,
states that: "Property thus withdrawn from public servitude may be used or conveyed for any purpose for
which other real property belonging to the City may be lawfully used or conveyed."
Accordingly, the withdrawal of the property in question from public use and its subsequent sale to the
petitioner is valid. Hence, the petitioner has a registerable title over the lot in question.
Property of Provinces, Cities, and Municipalities:

divided into property for public use and patrimonial property;
patrimonial property (all other property); property for public use (provincial roads, city streets,
municipal streets, squares, fountains, public waters, promenades, and public works for public service paid
for by said provinces, cities, or municipalities) (governed by same principles as property of public dominion)
Provincial roads, city streets and municipal streets:

outside the commerce of man, may not be the subject of lease or other contract;
the closure should be for the sole purpose of withdrawing the road or other public property from public use
when circumstances show that such property is no longer intended or necessary for public use or public
service;
when it is already withdrawn from public use, the property then becomes patrimonial property of the LGU
concerned
CASE PRINCIPLES:
VDA DE TAN TOCO VS MUNICIPAL COUNCIL OF ILOILO

Issue:
Whether or not the property levied upon is exempt from execution
Held:
The municipal law, section 2165 of the Administrative Code, provides that:
Municipalities are political bodies corporate, and as such are endowed with the faculties of
municipal corporations, to be exercised by and through their respective municipal government in
conformity with law.
It shall be competent for them, in their proper corporate name, to sue and be sued, to contract and
be contracted with, to acquire and hold real and personal property for municipal purposes, and
generally to exercise the powers hereinafter specified or otherwise conferred upon them by law.
For the purposes of the matter here in question, the Administrative Code does not specify the kind of
property that a municipality may acquire. However, article 343 of the Civil Code divides the property of
provinces and towns (municipalities) into property for public use and patrimonial property. According to
article 344 of the same Code, provincial roads and foot-path, squares, streets, fountains and public waters,
drives and public improvements of general benefit built at the expense of the said towns or provinces, are
property for public use.
All other property possessed by the said towns and provinces is patrimonial and shall be subject to the
provisions of the Civil Code except as provided by special laws.
We believe that the principle governing property of the public domain of the State is applicable to property
for public use of the municipalities as said municipal is similar in character. The principle is that the property
for public use of the State is not within the commerce of man and, consequently, is inalienable and not
subject to prescription. Likewise, property for public of the municipality is not within the commerce of man
so long as it is used by the public and, consequently, said property is also inalienable.
In the case of City of New Orleans vs. Louisiana Construction Co., Ltd., it was held that a wharf for
unloading sugar and molasses, open to the public, was property for the public use of the City of New
Orleans and was not subject to attachment for the payment of the debts of the said city.
In the case of Klein vs. City of New Orleans, the Supreme Court of the United States held that a public
wharf on the banks of the Mississippi River was public property as necessary as a public street and was
not subject to execution on account of the debts of the city.
It is evident that the movable and immovable property of a municipality, necessary for governmental
purpose, may not be attached and sold for the payment of a judgment against the municipality. The
supreme reason for this rule is the character of the public use to which such kind of property is devoted.
The necessity for government service justifies that the property of public of the municipality be exempt from
execution just as it is necessary to exempt certain property of private individuals in accordance with section
452 of the Code of Civil Procedure.
PROVINCE OF ZAMBOANGA DEL NORTE VS CITY OF ZAMBOANGA

Issue/s:
Whether or not RA 3039 was valid
Ruling:
If the property is owned by the municipality in its public and governmental capacity, the property is public
and Congress has absolute control over it. But if the property is owned in its private or proprietary capacity,
then it is patrimonial and Congress has no absolute control. The municipality cannot be deprived of it
without due process and payment of just compensation.
The capacity in which the property is held is dependent on the use to which it is intended and devoted.
The Civil Code provides:
ART. 423. The property of provinces, cities, and municipalities is divided into property for public use and
patrimonial property.
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.
Applying the above cited provision, all the properties in question, except the two lots used as High School
playgrounds, could be considered as patrimonial properties of the former Zamboanga province. Even the
capital site, the hospital and leprosarium sites, and the school sites will be considered patrimonial for they
are not for public use. They would fall under the phrase "public works for public service" for it has been held
that under the general rule, such public works must be for free and indiscriminate use by anyone.
However, the norm obtaining under the principles constituting the law of Municipal Corporations is
applicable to the present controversy and not that of civil law. Under this norm, to be considered public, it
is enough that the property be held and, devoted for governmental purposes like local administration, public
education, public health, etc.
The SC further added that to hold municipal property devoted to public service in the same category as
ordinary private property is unacceptable. The consequences of which would be to the detriment of the
local community.
Petition Granted
SALAS VS JARENCIO
MANILA LODGE 761 VS COURT OF APPEALS

Issue:
Whether or not the property subject of the action was patrimonial property of the City of Manila and not a
park or plaza.
Held:
The grant made by Act No. 1360 of the reclaimed land to the City of Manila is a grant of "public" nature, the
same having been made to a local political subdivision. Such grants have always been strictly construed
against the grantee, for the reason that there is in such grant a gratuitous donation of, public money or
resources which results in an unfair advantage to the grantee and for that reason, the grant should be
narrowly restricted in favor of the public.
The reclaimed area, an extension to the Luneta, is declared to be property of the City of Manila. Property,
however, is either of public ownership or of private ownership. What kind of property of the City is the
reclaimed land?
We hold that it is of public dominion, intended for public use.
Firstly, if the reclaimed area was granted to the City of Manila as its patrimonial property, the City could, by
virtue of its ownership, dispose of the whole reclaimed area without need of authorization to do so from the
lawmaking body. Thus Article 348 of the Civil Code of Spain provides that "ownership is the right to enjoy
and dispose of a thing without further limitations than those established by law." The right to dispose (jus
disponendi) of one's property is an attribute of ownership.
Act No. 1360, as amended, however, provides by necessary implication, that the City of Manila could not
dispose of the reclaimed area without being authorized by the lawmaking body. Hence without the
authorization expressly given by Act No. 1360, the City of Manila could not lease or sell even the northern
portion; much less could it dispose of the whole reclaimed area. Consequently, the reclaimed area was
granted to the City of Manila, not as its patrimonial property.
What we do know is that if the reclaimed land were patrimonial property, there would be no need of giving
special authorization to the City to dispose of it. Said authorization was given because the reclaimed land
was not intended to be patrimonial property of the City of Manila, and without the express authorization to
dispose of the northern portion, the City could not dispose of even that part.
Secondly, the reclaimed area is an "extension to the Luneta in the City of Manila." 40 If the reclaimed area is
an extension of the Luneta, then it is of the same nature or character as the old Luneta.
It is not disputed that the old Luneta is a public park or plaza and it is so considered by Section 859 of the
Revised Ordinances of the City of Manila. 42 Hence the "extension to the Luneta" must be also a public park
or plaza and for public use.
Thirdly, the reclaimed area was formerly a part of the manila Bay. A bay is nothing more than an inlet of the
sea. Pursuant to Article 1 of the Law of Waters of 1866, bays, roadsteads, coast sea, inlets and shores are
parts of the national domain open to public use. These are also property of public ownership devoted to
public use, according to Article 339 of the Civil Code of Spain. When the shore or part of the bay is
reclaimed, it does not lose its character of being property for public use, according to Government of the
Philippine Islands vs. Cabangis.
Fourthly, Act 1360, as amended, authorized the lease or sale of the northern portion of the reclaimed area
as a hotel sites. The subject property is not that northern portion authorized to be leased or sold; the
subject property is the southern portion. Hence, applying the rule of expresio unius est exlusio alterius, the
City of Manila was not authorized to sell the subject property.
Fifthly, Article 344 of the Civil Code of Spain provides that to property of public use, in provinces and in
towns, comprises the provincial and town roads, the squares streets fountains, and public waters the
promenades, and public works of general service paid for by such towns or provinces." A park or plaza,
such as the extension to the Luneta, is undoubtedly comprised in said article.
It should be noted, however, that properties of provinces and towns for public use are governed by the
same principles as properties of the same character belonging to the public domain. 46 In order to be
property of public domain an intention to devote it to public use is sufficient.
It is not necessary, therefore, that a plaza be already constructed of- laid out as a plaza in order that it be
considered property for public use. It is sufficient that it be intended to be such In the case at bar, it has
been shown that the intention of the lawmaking body in giving to the City of Manila the extension to the
Luneta was not a grant to it of patrimonial property but a grant for public use as a plaza.
In Ignacio vs. The Director of Lands, the executive and possibly the legislation department that has the
authority and the power to make the declaration that said property, is no longer required for public use, and
until such declaration is made the property must continue to form part of the public domain.
Government funds, garnishment of:
CASE PRINCIPLE:
COMMISSIONER OF PUBLIC HIGHWAYS ET AL VS LOURDES SAN DIEGO

On the principal issue, the Court holds that respondent Court's two questioned orders (1) for execution of
the judgment, in pursuance whereof respondent deputy clerk issued the corresponding writ of execution
and respondent special sheriff issued the notice of garnishment, and (2) for delivery of the garnished
amount of P209,076.00 to respondent estate as judgment creditor through respondent special sheriff, are
null and void on the fundamental ground that government funds are not subject to execution or
garnishment.
The universal rule that where the State gives its consent to be sued by private parties either by general or
special law, it may limit claimant's action "only up to the completion of proceedings anterior to the stage of
execution" and that the power of the Courts ends when the judgment is rendered, since government funds
and properties may not be seized under writs of execution or garnishment to satisfy such judgments, is
based on obvious considerations of public policy. Disbursements of Public funds must be covered by the
corresponding appropriation as required by law. The functions and public services rendered by the State
cannot be allowed to be paralyzed or disrupted by the diversion of public funds from their legitimate and
specific objects, as appropriated by law.
Funds of “government-owned” corporations:
CASE PRINCIPLES:
PROFESSIONAL VIDEO INC VS TESDA

TESDA, as an agency of the State, cannot be sued without its consent.
Now, the fact that a non-corporate government entity performs a function proprietary in nature does not
necessarily result in its being suable. If said non-governmental function is undertaken as an incident to its
governmental function, there is no waiver thereby of the sovereign immunity from suit extended to such
government entity.
TESDA’s funds are public in character, hence exempt from attachment or garnishment.
It is therein expressly provided, ‘The State may not be sued without its consent.’ A corollary, both dictated
by logic and sound sense, from such a basic concept, is that public funds cannot be the object of
garnishment proceedings even if the consent to be sued had been previously granted and the state liability
adjudged.
Being public funds, the deposits are not within the reach of any garnishment or attachment proceedings.
OWNERSHIP
Definition and Concept of Ownership: no definition in the Civil Code, but enumeration; the concept of
“property” refers to those things which are susceptible of appropriation while the concept of “ownership”
refers to the mass or bundle of rights that may be exercised over a property; ownership refers to the
bundles of rights that may be exercised over a property while the latter is the object of the exercise of such
rights
Attributes of Ownership: under Roman Law, 1) jus utendi (right to use property without destroying its
substance); 2) jus fruendi (right to the fruits); 3) jus dispodendi (right to dispose or alienate); 4) jus abutendi
(right to abuse or consume); 5) jus possidendi (right to possess); 6) jus vindicandi (right to recover); under
Art 428 of the Civil Code, 1) right to enjoy (includes right to use, right to the fruits, right to possess, right to
abuse or consume), 2) right to dispose, and 3) right to recover
Right to Enjoy: right of the owner to freely enjoy either the property itself or the benefits derived therefrom
Right to Use and Abuse: to use a thing consists in employing it for the purpose for which it is fit, without
destroying it, and which employment can therefore be repeated; jus abutendi properly meant the use that
extinguishes, that consumes, by acts of the owner, things which are consumable
Right to Dispose: includes the power to alienate, to encumber, to limit, to transform, to destroy and to
merge; right to alienate is the right of the owner to transmit either by onerous or gratuitous title his right to
another by any act inter vivos or mortis causa; right to limit or encumber is the power of the owner to
deprive himself of several of the rights included in ownership and transfer them to another; right to
transform is the power to change the nature of the thing; the power to destroy is the power to render
useless or to abandon or annihilate the thing
Right to Recover: Right to Possession: possession as an incident of ownership or a right included in

ownership (jus possidendi), as distinguished from possession as a right independent and apart from
ownership (jus possessionis; discussed separately in Title V of Book II); owner is entitled to exclusive
possession of his property (he may exclude any person from enjoyment and disposal thereof by force if
necessary and he may also enclose or fence his property by any means); in the event that the possessor is
unlawfully deprived of possession he is not justified to take the law into his own hands, instead resort to
juridical process for the recovery of the property
Replevin: recovery of possession of a personal property; does not apply to real property
3 kinds of actions available to recover possession of real property: 1) accion interdictal, 2) accion
publiciana, 3) accion reivindicatoria
Accion Interdictal:
2 causes of action, 1) forcible entry and 2) unlawful detainer;
both actions within exclusive and original jurisdiction of Metropolitan or Municipal Trial Courts
Forcible Entry: summary action to recover material or physical possession of real property when the
person who originally held it was deprived of possession by force, intimidation, threat, strategy, or stealth;
brought within 1 year from date of actual entry
Unlawful Detainer: filed when possession by a lessor, vendor, vendee, or other person against whom the
possession of any land or building is unlawfully withheld after the expiration or termination of the right to
hold possession, by virtue of any contract, express or implied; brought within 1 year from the date of last
demand
Forcible Entry and Unlawful Detainer, Distinguished:

1) forcible entry, possession ab initio; unlawful detainer, possession originally lawful but becomes illegal (by
reason of termination of right of possession under the contract);
2) forcible entry, prove prior physical possession; unlawful detainer, need not have been in prior physical
possession;
3) forcible entry, 1 year period of prescription counted from date of actual entry; unlawful detainer, 1 year
prescriptive period counted from date of last demand
CASE PRINCIPLES:
VILLA VS HEIRS OF ALTAVAS

(can’t find the case)
Note from Atty. G: the lease contract in this case is signed by an administrator, inferior to right of
possession of the owner
ESTATE OF SOLEDAD MANANTAN VS ANICETO SOMERA

Unlawful detainer is a summary action for the recovery of possession of real property.16 This action may
be filed by a lessor, vendor, vendee, or other person against whom the possession of any land or building
is unlawfully withheld after the expiration or termination of the right to hold possession by virtue of any
contract, express or implied.
In unlawful detainer cases, the possession of the defendant was originally legal, as his possession was
permitted by the plaintiff on account of an express or implied contract between them. However, defendant’s
possession became illegal when the plaintiff demanded that defendant vacate the subject property due to
the expiration or termination of the right to possess under their contract, and defendant refused to heed
such demand.
A case for unlawful detainer must be instituted before the proper municipal trial court or metropolitan trial
court within one year from unlawful withholding of possession. Such one year period should be counted
from the date of plaintiff’s last demand on defendant to vacate the real property, because only upon the
lapse of that period does the possession become unlawful.
It appears from the allegations in the Complaint that the respondent was already in possession of the
disputed portion at the time Manantan bought the subject property from the Bayot family, and it was only
after the conduct of a relocation survey, which supposedly showed that respondent was encroaching on the
subject property, did Manantan begin asserting her claim of ownership over the portion occupied and used
by respondent. Clearly, respondent’s possession of the disputed portion was not pursuant to any contract,
express or implied, with Manantan, and, resultantly, respondent’s right of possession over the disputed
portion is not subject to expiration or termination. At no point can it be said that respondent’s possession of
the disputed portion ceased to be legal and became an unlawful withholding of the property from
Manantan.
Accion Publiciana:
action for recovery of the right to possess and is a plenary action in an ordinary civil proceeding to
determine the better right of possession of realty independent of the title or ownership of the property;
issue is determination of the better right of possession or possession de jure (e.g. contract of lease);
basis of the recovery of possession is the plaintiff’s real right of possession or jus possessionis
Accion Interdictal: summary action of ejectment; issue is limited to the question of possession de facto
Accion Reinvidicatoria:
a suit which has for its object the recovery of possession over the real property as owner;
action whereby plaintiff alleges ownership over a parcel of land and seeks recovery of its full possession;
involves recovery of possession as an incident or attribute of ownership or jus possidendi;
basis of the action for recovery of possession is ownership itself;
action to recover possession based on ownership;
the person who claims a better right must prove 2 things: 1) identity of the land claimed, and 2) his title
thereto;
proof of identity (the person who claims that he has a better right to the property must first fix the identity of
the land he is claiming by describing the location, area and boundaries thereof;
when there is a conflict between the area and the boundaries of a land, the latter prevails for what really
defines a piece of land is not the are mentioned in its description, but the boundaries therein laid down, as
enclosing the land and indicating its limits);
proof of title (a certificate of title is considered as conclusive evidence of ownership of the land described
therein, the validity of which is not subject to collateral attack;
tax declaration coupled with proof of actual possession are strong evidence of ownership);
in an action to recover real property, the settled rule is that the plaintiff must rely on the strength of his title,
not on the weakness of the defendant’s title, since in civil cases the burden of proof lies in the one who
substantially asserts the affirmative of an issue;
jurisdiction depends on location and value of property (within Metro Manila - does not exceed P50,000 with
MetropolitanTC, exceeds P50,000 with RTC; outside Metro Manila – does not exceed P20,000 with
MunicipalTC, exceeds P20,000 with RTC)
CASE PRINCIPLE:
IGLESIA NI CRISTO VS HON. PONFERRADA

An accion reinvindicatoria does not necessarily presuppose that the actual and material possession of the
property is on defendant and that plaintiff seeks the recovery of such possession from defendant. It bears
stressing that an accion reinvindicatoria is a remedy seeking the recovery of ownership and includes jus
possidendi, jus utendi, and jus fruendi as well. It is an action whereby a party claims ownership over a
parcel of land and seeks recovery of its full possession. Thus, the owner of real property in actual and
material possession thereof may file an accion reinvindicatoria against another seeking ownership over a
parcel of land including jus vindicandi, or the right to exclude defendants from the possession thereof. In
this case, respondents filed an alternative reinvindicatory action claiming ownership over the property and
the cancellation of TCT No. 321744 under the name of petitioner. In fine, they sought to enforce their jus
utendi and jus vindicandi when petitioner claimed ownership and prevented them from fencing the property.
Note from Atty. G: whenever there is a disturbance or doubt is cast on any of attributes of ownership, you
can file an accion reinvidicatoria
Doctrine of Self-Help:
allowing the owner to use such force as may be reasonably necessary to repel or prevent an actual or
threatened unlawful physical invasion or usurpation of his property;
exception Lawful Aggression, Act of Necessity;
may be invoked by owners of the property or its lawful possessor;
may be invoked only if the purpose is to repel or prevent an actual or threatened unlawful physical invasion
or usurpation of the said property; when possession has already been lost, owner must resort to judicial
process for the recovery of the property
CASE PRINCIPLE:
GERMAN MANAGEMENT & SERVICES INC VS COURT OF APPEALS

Both the Municipal Trial Court and the Regional Trial Court have rationalized petitioner's drastic action of
bulldozing and destroying the crops of private respondents on the basis of the doctrine of self-help
enunciated in Article 429 of the New Civil Code. 11 Such justification is unavailing because the doctrine of
self-help can only be exercised at the time of actual or threatened dispossession which is absent in the
case at bar. When possession has already been lost, the owner must resort to judicial process for the
recovery of property. This is clear from Article 536 of the Civil Code which states, "(I)n no case may
possession be acquired through force or intimidation as long as there is a possessor who objects thereto.
He who believes that he has an action or right to deprive another of the holding of a thing, must invoke the
aid of the competent court, if the holder should refuse to deliver the thing."
Acts in a State of Necessity:

interference by a 3rd person with another’s property is justified and cannot be prevented by the latter if such
interference is necessary to avert an imminent danger and the threatened damage, compared to the
damage arising to the owner from the interference is much greater;
requisites, 1) actual or imminent danger, 2) interference is necessary, 3) threatened damage is much
greater compared to the damage arising from interference, 4) state of necessity must not be brought about
by the intentional provocation of the party invoking the same;
the persons benefited by such interference are duty bound to indemnify the owner for the damage suffered
by the latter;
if the danger comes from another’s property, the case is one of defense against danger, in which case,
there is no obligation to indemnify the owner for the damage caused if the latter himself was responsible for
such damage;
if another’s property is used to avert danger not arising from it, the act is essentially one in a state of
necessity which will entitle the owner to the indemnity
Limitations on the Right of Ownership: 1) imposed for the benefit of State, 2) imposed by the law (e.g.
easement of right of way)
CASE PRINCIPLE:
ROMAN CATHOLIC ARCHBISHOP OF MANILA ET AL VS COURT OF APPEALS

Although it is true that under Article 764 of the Civil Code an action for the revocation of a donation must be
brought within four (4) years from the non-compliance of the conditions of the donation, the deed of
donation involved herein expressly provides for automatic reversion of the property donated in case of
violation of the condition. No legal necessity to have the donation judicially declared null and void for the
reason that the very deed of donation itself declares it so.
A judicial action is proper only when there is absence of a special provision granting the power of
cancellation.
In contracts providing for automatic revocation, judicial intervention is necessary in order to determine
whether or not the rescission was proper.
Although the action filed by private respondents may not be dismissed by reason of prescription, the same
should be dismissed on the ground that private respondents have no cause of action against petitioners.
Donation, as a mode of acquiring ownership, results in an effective transfer of title over the property from
the donor to the donee. Once a donation is accepted, the donee becomes the absolute owner of the
property donated. Although the donor may impose certain conditions in the deed of donation, the same
must not be contrary to law, morals, good customs, public order and public policy. The condition imposed in
the deed of donation in the case before us constitutes a patently unreasonable and undue restriction on the
right of the donee to dispose of the property donated, which right is an indispensable attribute of
ownership.
The prohibition in the deed of donation against the alienation of the property for an entire century is
unreasonable. It amounts to the denial of an integral attribute of ownership, thus, it should be declared as
an illegal or impossible condition.
Petition Dismissed
Power of Eminent Domain, Police Power, and Power of Taxation
Eminent Domain: inherent power of the State that enables it to forcibly acquire private lands intended for
public use upon payment of just compensation to the owner; constraints, 1) just compensation, and 2) due
process of law
CASE PRINCIPLES:
AIR TRANSPORTATION OFFICE (ATO) VS GOPUCO

When private land is expropriated for a particular public use, and that particular public use is abandoned,
does the land so expropriated return to its former owner?
The answer to that question depends upon the character of the title acquired by the expropriator, whether it
be the State, a province, a municipality, or a corporation which has the right to acquire property under the
power of eminent domain. If, for example, land is expropriated for a particular purpose, with the condition
that when that purpose is ended or abandoned the property shall return to its former owner, then, of
course, when the purpose is terminated or abandoned the former owner reacquires the property so
expropriated.
When land has been acquired for public use in fee simple, unconditionally, either by the exercise of
eminent domain or by purchase, the former owner retains no rights in the land, and the public use may be
abandoned or the land may be devoted to a different use, without any impairment of the estate or title
acquired, or any reversion to the former owner.
Neither has Gopuco, in the present case, adduced any evidence at all concerning a right of repurchase in
his favor. The trial court was thus correct in denying Gopuco’s claim for the reconveyance of Lot No. 72 in
his favor.
COMPARE WITH:
HEIRS OF MORENO VS MCIAA

ISSUE:
Whether or not the petitioners have the right to repurchase the subject parcels of land on the ground that
the government failed to utilize them for the extension of the Lahug Airport; payment of just compensation
notwithstanding
RULING:
If land is expropriated for a particular purpose, with the condition that when that purpose is ended or
abandoned the property shall return to its former owner, then, of course, when the purpose is terminated or
abandoned the former owner reacquires the property so expropriated
If land is expropriated for a public street and the expropriation is granted upon condition that the city can
only use it for a public street, then, of course, when the city abandons its use as a public street, it returns to
the former owner, unless there is some statutory provision to the contrary
If, upon the contrary, however, the decree of expropriation gives to the entity a fee simple title, then, of
course, the land becomes the absolute property of the expropriator, whether it be the State, a province, or
municipality, and in that case the non-user does not have the effect of defeating the title acquired by the
expropriation proceedings
When land has been acquired for public use in fee simple, unconditionally, either by the exercise of
eminent domain or by purchase, the former owner retains no rights in the land, and the public use may be
abandoned, or the land may be devoted to a different use, without any impairment of the estate or title
acquired, or any reversion to the former owner
Mactan-Cebu International Airport Authority36 is correct in stating that one would not find an express
statement in the Decision in Civil Case No. R-1881 to the effect that "the [condemned] lot would return to
[the landowner] or that [the landowner] had a right to repurchase the same if the purpose for which it was
expropriated is ended or abandoned or if the property was to be used other than as the Lahug Airport." This
omission notwithstanding, and while the inclusion of this pronouncement in the judgment of condemnation
would have been ideal, such precision is not absolutely necessary nor is it fatal to the cause of petitioners
herein. No doubt, the return or repurchase of the condemned properties of petitioners could be readily
justified as the manifest legal effect or consequence of the trial court’s underlying presumption that "Lahug
Airport will continue to be in operation" when it granted the complaint for eminent domain and the airport
discontinued its activities.
The expropriated properties would remain to be so until it was confirmed that Lahug Airport was no longer
"in operation." This inference further implies two (2) things:
(a) after the Lahug Airport ceased its undertaking as such and the expropriated lots were not being used for
any airport expansion project, the rights vis-à-vis the expropriated Lots Nos. 916 and 920 as between the
State and their former owners, petitioners herein, must be equitably adjusted; and,
(b) the foregoing unmistakable declarations in the body of the Decision should merge with and become an
intrinsic part of the fallo thereof which under the premises is clearly inadequate since the dispositive portion
is not in accord with the findings as contained in the body thereof
The predicament of petitioners involves a constructive trust, one that is akin to the implied trust referred to
in Art. 1454 of the Civil Code, "If an absolute conveyance of property is made in order to secure the
performance of an obligation of the grantor toward the grantee, a trust by virtue of law is established. If the
fulfillment of the obligation is offered by the grantor when it becomes due, he may demand the
reconveyance of the property to him." In the case at bar, petitioners conveyed Lots Nos. 916 and 920 to the
government with the latter obliging itself to use the realties for the expansion of Lahug Airport; failing to
keep its bargain, the government can be compelled by petitioners to reconvey the parcels of land to them,
otherwise, petitioners would be denied the use of their properties upon a state of affairs that was not
conceived nor contemplated when the expropriation was authorized.
The rights and obligations between the constructive trustee and the beneficiary, in this case, respondent
MCIAA and petitioners over Lots Nos. 916 and 920, are echoed in Art. 1190 of the Civil Code, "When the
conditions have for their purpose the extinguishment of an obligation to give, the parties, upon the
fulfillment of said conditions, shall return to each other what they have received x x x x In case of the loss,
deterioration or improvement of the thing, the provisions which, with respect to the debtor, are laid down in
the preceding article shall be applied to the party who is bound to return x x x x"
Hence, respondent MCIAA as representative of the State is obliged to reconvey Lots Nos. 916 and 920 to
petitioners who shall hold the same subject to existing liens thereon, i.e., leasehold right of DPWH. In
return, petitioners as if they were plaintiff-beneficiaries of a constructive trust must restore to respondent
MCIAA what they received as just compensation.
Just Compensation in Agrarian Cases: applicable to agricultural lands only; sec 17 ra 6657 enumerates
factors to consider just compensation and formula for just compensation in agrarian reform cases; correct
and prompt payment; partly in cash, partly in LBP bonds (can be used as long as creditor is govt)
CASE PRINCIPLE:
APO FRUITS CORPORATION VS COURT OF APPEALS

Note from Atty. G: other factors other than actual land use should be considered
Police Power: the power of promoting the public welfare by restraining and regulating the use of liberty
and property; owner does not recover from the govt for injury sustained in consequence thereof; property
condemned under police power is noxious or intended for a noxious purpose
CASE PRINCIPLES:
CITY OF MANILA VS HON. LAGUIO

The Ordinance disallows the operation of sauna parlors, massage parlors, karaoke bars, beerhouses, night
clubs, day clubs, super clubs, discotheques, cabarets, dance halls, motels and inns in the Ermita-Malate
area.
To successfully invoke the exercise of police power as the rationale for the enactment of the Ordinance,
and to free it from the imputation of constitutional infirmity, not only must it appear that the interests of the
public generally, as distinguished from those of a particular class, require an interference with private
rights, but the means adopted must be reasonably necessary for the accomplishment of the purpose and
not unduly oppressive upon individuals.60 It must be evident that no other alternative for the
accomplishment of the purpose less intrusive of private rights can work. A reasonable relation must exist
between the purposes of the police measure and the means employed for its accomplishment, for even
under the guise of protecting the public interest, personal rights and those pertaining to private property will
not be permitted to be arbitrarily invaded.
Lacking a concurrence of these two requisites, the police measure shall be struck down as an arbitrary
intrusion into private rights a violation of the due process clause.
The object of the Ordinance was, accordingly, the promotion and protection of the social and moral values
of the community. Granting for the sake of argument that the objectives of the Ordinance are within the
scope of the City Council's police powers, the means employed for the accomplishment thereof were
unreasonable and unduly oppressive.
OFFICE OF THE SOL GEN VS AYALA LAND

Questioning the legality of parking fees:
Police power is the power of promoting the public welfare by restraining and regulating the use of liberty
and property. It is usually exerted in order to merely regulate the use and enjoyment of the property of the
owner. The power to regulate, however, does not include the power to prohibit. A fortiori, the power to
regulate does not include the power to confiscate. Police power does not involve the taking or confiscation
of property, with the exception of a few cases where there is a necessity to confiscate private property in
order to destroy it for the purpose of protecting peace and order and of promoting the general welfare; for
instance, the confiscation of an illegally possessed article, such as opium and firearms.
When there is a taking or confiscation of private property for public use, the State is no longer exercising
police power, but another of its inherent powers, namely, eminent domain. Eminent domain enables the
State to forcibly acquire private lands intended for public use upon payment of just compensation to the
owner.
Although in the present case, title to and/or possession of the parking facilities remain/s with respondents,
the prohibition against their collection of parking fees from the public, for the use of said facilities, is already
tantamount to a taking or confiscation of their properties. The State is not only requiring that respondents
devote a portion of the latter’s properties for use as parking spaces, but is also mandating that they give the
public access to said parking spaces for free. Such is already an excessive intrusion into the property rights
of respondents.
Extent of Ownership:
owner of piece of land has rights not only to its surface but also to everything underneath and the airspace
above it up to a reasonable height;
owner of the land could use the overlying space to such an extent as he was able, and that no one could
ever interfere with that use;
the landowners’ right extends to such height or depth where it is possible for them to obtain some benefit or
enjoyment, and it is extinguished beyond such limit as there would be no more interest protected by law;
limitations upon right to airspace, 1) bound by restrictions annotated on the certificate of title, and 2) for
properties near the airport, owners cannot complain of the reasonable requirements of aerial navigation
Regalian Doctrine: refer to stock knowledge
Hidden Treasure:
any hidden and unknown deposit of money, jewelry, or other precious objects, the lawful ownership of
which does not appear;
requisites, 1) deposit of money, jewelry or other precious objects must be hidden or unknown, and 2) lawful
ownership of which must not appear;
if the finder of the hidden treasure is the owner of the land, building or property on which it is found, the
treasure shall belong to him;
if the finder is a 3rd person, he is entitled to one-half of the treasure if he is not a trespasser and the
discovery of the treasure is only by chance, otherwise he shall not be entitled; the same rule shall apply
even if the land belongs to the State;
however, if the thing found be of interest to science or the arts, the State may acquire them by paying just
price, whether the finder of the treasure is the owner of the property on which it is found or a 3rd person.
CASE PRINCIPLES:
NATIONAL POWER CORPORATION VS IBRAHIM

The NPC constructed underground tunnels on the property of the respondents without their knowledge and
consent.
The Court sustains the finding of the lower courts that the sub-terrain portion of the property similarly
belongs to respondents. This conclusion is drawn from Article 437 of the Civil Code which provides:
ART. 437. The owner of a parcel of land is the owner of its surface and of everything under it, and he can
construct thereon any works or make any plantations and excavations which he may deem proper, without
detriment to servitudes and subject to special laws and ordinances. He cannot complain of the reasonable
requirements of aerial navigation.
Thus, the ownership of land extends to the surface as well as to the subsoil under it.
Presumably, the landowners’ right extends to such height or depth where it is possible for them to obtain
some benefit or enjoyment, and it is extinguished beyond such limit as there would be no more interest
protected by law.
REPUBLIC OF THE PHILS (DIRECTOR OF FOREST DEVT) VS COURT OF APPEALS AND DELA
ROSA
Under the theory of the respondent court, the surface owner will be planting on the land while the mining
locator will be boring tunnels underneath. The farmer cannot dig a well because he may interfere with the
operations below and the miner cannot blast a tunnel lest he destroy the crops above. How deep can the
farmer, and how high can the miner, go without encroaching on each other's rights? Where is the dividing
line between the surface and the sub-surface rights?
The Court feels that the rights over the land are indivisible and that the land itself cannot be half agricultural
and half mineral. The classification must be categorical; the land must be either completely mineral or
completely agricultural. In the instant case, as already observed, the land which was originally classified as
forest land ceased to be so and became mineral — and completely mineral — once the mining claims were
perfected. As long as mining operations were being undertaken thereon, or underneath, it did not cease to
be so and become agricultural, even if only partly so, because it was enclosed with a fence and was
cultivated by those who were unlawfully occupying the surface.
RIGHT OF ACCESSION
Accession, Definition and Concept:

right of an owner of a thing to the products of said thing as well as to whatever is inseparably attached
thereto as an accessory;
presupposes a previously existing ownership by the owner over the principle;
not among the modes of acquiring ownership (occupation, intellectual creation, law, donation, succession,
tradition, and prescription), thus it is a right included in ownership;
classified into two, 1) accession discreta, and 2) accession continua
Accession Discreta:
right of the owner to anything which is produced by his property;
exception,
a) in usufruct (usufructuary is entitled not only to the enjoyment of the property subject matter thereof but
also to its fruits),
b) in lease of rural lands (lessee is entitled to natural and industrial fruits of the thing leased while the lessor
is entitled to civil fruits),
c) in antichresis (creditor acquires the right to receive the fruits of an immovable of his debtor, with the
obligation to apply them to the payment of the interest, if owing, and thereafter to the principal of his credit),
d) in possession in good faith (a possessor in good faith is entitled to the fruits received by him before his
possession is legally interrupted),
e) fruits naturally falling (fruits naturally falling upon adjacent land belong to the owner of the said land and
not to the owner of the tree);
divided into, 1) natural fruits, 2) industrial fruits, and 3) civil fruits;
Natural Fruits: two kinds, 1) spontaneous products of the soil (appear without the intervention of human
labor, such as wild fruits in the forest), 2) young and other products of animals
Industrial Fruits: produced by lands of any kind through cultivation or labor; requirements, 1) produced by
the land, and 2) produced through cultivation or labor; required that they must come from the soil
Civil Fruits: refers to rents of building, the price of leases of lands and other property an dthe amount of
perpetual or life annuity or other similar income; income or revenues derived from the property itself
Right of Accession with respect to Immovable Property: classified into either industrial accession or
natural accession
Accession Continua: right of the owner to anything which is incorporated or attached to his property,
whether such attachment is through natural or artificial causes
Basic Principles:
1) union or attachment or incorporation of 2 or more things belonging to different owners to each other or to
one another must be such that they cannot be separated from each other or form one another without
causing a substantial physical or juridical injury to any one, to some, or to all of the things involved,
2) accessory follows the principal (accession cedit principali) (owner of the principal thing has the right to
claim ownership of the accessory thing and not vice versa,
3) no one shall unjustly enrich himself at the expense of another,
4) good faith exonerates a person from punitive liability and damages,
5) bad faith subjects a person to damages and other unfavourable consequences,
6) bad faith of one party neutralizes the bad faith of the other and, therefore, both should be considered as
having acted in good faith
Industrial Accession: may take the form of building, planting, or sowing
CASE PRINCIPLES:
SARMIENTO VS AGANA
The Supreme Court, deviating from the general rule that Art 448 applies only when a builder builds in the
concept of an owner, ruled that the Valentino spouses were builders in good faith in view of the peculiar
circumstances under which they constructed their residential house. As far as the couple knew, the land
was owned by the husband’s mother-in-law who, having stated they could build on the property, could
reasonably be expected to later on give them the land. It turned out the land had been titled in the name of
another person.
BALUCANAG VS JUDGE FRANCISCO

ISSUE:
At issue in this case is determination of the respective rights of the lessor and the lessee over the
improvements introduced by the latter in the leased premises.
SUPREME COURT:
1.) The petition is impressed with merit. The lease contract provides that such buildings and
improvements shall remain in the property of the lessee and he may remove them at any time, it
being agreed, however, that should he not remove the said buildings and improvements within a
period of two months after the expiration of this Agreement, the Lessor may remove the said
buildings and improvements or cause them to be removed at the expense of the Lessee."
Respondent Stohner does not assail the validity of this stipulation, Neither has he advanced any
reason why he should not be bound by it.
2.) But even in the absence of said stipulation, respondent cannot be considered a builder in good
faith. Article 448 of the Civil Code, relied upon by respondent judge, applies only to a case where
one builds on land in the belief that he is the owner thereof and it does not apply where one's only
interest in the land is that of a lessee under a rental contract. In the case at bar, there is no dispute
that the relation between Balucanag and Stohner is that of lessor and lessee, the former being the
successor in interest of the original owner of the lot.
3.) The law applicable to the case at bar is Article 1678 of the Civil Code, which We quote:
..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 the time.
Should the lessor refuse to reimburse said amount, the lessee may remove the improvements, even
though the principal thing may suffer damage thereby. He shall not, however, cause any more
impairment upon the property leased than is necessary. ...
This article gives the lessor the option to appropriate the useful improvements by paying one-half of their
value, And the lessee cannot compel the lessor to appropriate the improvements and make
reimbursement, for the lessee's right under the law is to remove the improvements even if the leased
premises may suffer damage thereby. But he shall not cause any more damage upon the property than is
necessary.
4.) Another point is that the lease contract has already expired yet respondent was still allowed to
occupy the premises. An implied new lease or tacita reconduccion was thus created between the
parties, the period of which is established by Article 1687 of the Civil Code thus:
Art. 1687. If the period for the lease has not been fixed, it is understood to be from year to year, if
the rent agreed upon is annual; from month to month, if it is monthly: from week to week, if the rent
is weekly: and from day to day, if the rent is to be paid daily. ...
Under the above article, the duration of the new lease must be deemed from month to month, the agreed
rental in the instant case being payable on a monthly basis. The lessor may thus terminate the lease after
each month with due notice upon the lessee. After such notice, the lessee's right to continue in possession
ceases and his possession becomes one of detainer. Furthermore, Stohner's failure to pay the stipulated
rentals entities petitioner to recover possession of the premises.
FLOREZA VS EVANGELISTA
It should be noted that petitioner did not construct his house as a vendee a retro. The house had already
been constructed as far back as 1949 (1945 for the house of light materials) even before the pacto de retro
sale in 1949. Petitioner incurred no useful expense, therefore, after that sale. The house was already there
at the tolerance of the EVANGELISTAS in consideration of the several loans extended to them. Since
petitioner cannot be classified as a builder in good faith within the purview of Article 448 of the Civil Code,
nor as a vendee a retro, who made useful improvements during the lifetime of the pacto de retro, petitioner
has no right to reimbursement of the value of the house which he had erected on the residential lot of the
EVANGELISTAS, much less to retention of the premises until he is reimbursed.The rights of petitioner are
more akin to those of a usufructuary who, under Article 579 of the Civil (Art. 487 of the old Code), may
make on the property useful improvements but with no right to be indemnified therefor. He may, however,
remove such improvements should it be possible to do so without damage to the property: For if the
improvements made by the usufructuary were subject to indemnity, we would have a dangerous and unjust
situation in which the usufructuary could dispose of the owner's funds by compelling him to pay for
improvements which perhaps he would not have made.
SPOUSES DEL CAMPO VS ABESIA

The court a quo correctly held that Article 448 of the Civil Code cannot apply where a co-owner builds,
plants or sows on the land owned in common for then he did not build, plant or sow upon land that
exclusively belongs to another but of which he is a co-owner. The co-owner is not a third person under the
circumstances, and the situation is governed by the rules of co-ownership.
However, when, as in this case, the co-ownership is terminated by the partition and it appears that the
house of defendants overlaps or occupies a portion of 5 square meters of the land pertaining to plaintiffs
which the defendants obviously built in good faith, then the provisions of Article 448 of the new Civil Code
should apply. Manresa and Navarro Amandi agree that the said provision of the Civil Code may apply even
when there was co-ownership if good faith has been established.
Applying the aforesaid provision of the Civil Code, the plaintiffs have the right to appropriate said portion of
the house of defendants upon payment of indemnity to defendants as provided for in Article 546 of the Civil
Code. Otherwise, the plaintiffs may oblige the defendants 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 defendants built thereon, then the latter cannot be obliged to buy the land. The defendants shall then pay
the reasonable rent to the plaintiff upon such terms and conditions that they may agree. In case of
disagreement, the trial court shall fix the terms thereof. Of course, defendants may demolish or remove the
said portion of their house, at their own expense, if they so decide.
PNB VS DE JESUS
In the context that such term is used in particular 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 various provisions of the Civil Code, pertinent to the subject, read:
“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 a case, he shall pay reasonable
rent, if the owner of the land does not choose to appropriate the building or trees after proper
indemnity. The parties shall agree upon the terms of the lease and in case of disagreement, the court shall
fix the terms thereof.”
“Article 449. He who builds, plants, or sows in bad faith on the land of another, loses what is built, planted
or sown without right to indemnity.”
“Article 450. The owner of the land on which anything has been built, planted or sown in bad faith may
demand the demolition of the work, or that the planting or sowing be removed, in order to replace things in
their former condition at the expense of the person who built, planted or sowed; or he may compel the
builder or planter to pay the price of the land, and the sower the proper rent.”
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.
Petitioner would fall much too short from its claim of good faith. Evidently, 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.”
In fine, petitioner is not in a valid position to invoke the provisions of Article 448 of the Civil Code.
ISMAEL MACASAET VS SPOUSES MACASAET

Case of children invited by parents to occupy the latter’s lots but an unresolved conflict resulted in
termination of their situation and the parents asked the children to vacate.
We hold that the facts of the present case rule out the finding of possession by mere tolerance. Petitioners
were able to establish that respondents had invited them to occupy the subject lots in order that they could
all live near one other and help in resolving family problems. By occupying those lots, petitioners
demonstrated their acceptance of the invitation.
As applied to the present case, accession refers to the right of the owner to everything that is incorporated
or attached to the property.60 Accession industrial -- building, planting and sowing on an immovable -- is
governed by Articles 445 to 456 of the Civil Code.
Article 447 is not applicable, because it relates to the rules that apply when the owner of the property uses
the materials of another. It does not refer to the instance when a possessor builds on the property of
another, which is the factual milieu here.
On the other hand, when a person builds in good faith on the land of another, the applicable provision is
Article 448. This Court has ruled that this provision covers only cases in which the builders, sowers or
planters believe themselves to be owners of the land or, at least, to have a claim of title thereto. It does not
apply when the interest is merely that of a holder, such as a mere tenant, agent or usufructuary. From
these pronouncements, good faith is identified by the belief that the land is owned; or that -- by some title --
one has the right to build, plant, or sow thereon.
Based on the aforecited special cases, Article 448 applies to the present factual milieu. The established
facts of this case show that respondents fully consented to the improvements introduced by petitioners. In
fact, because the children occupied the lots upon their invitation, the parents certainly knew and approved
of the construction of the improvements introduced thereon. Thus, petitioners may be deemed to have
been in good faith when they built the structures on those lots.
KILARIO VS COURT OF APPEALS

Considering that petitioners were in possession of the subject property by sheer tolerance of its owners,
they knew that their occupation of the premises may be terminated any time. Persons who occupy the land
of another at the latter's tolerance or permission, without any contract between them, is necessarily bound
by an implied promise that they will vacate the same upon demand, failing in which a summary action for
ejectment is the proper remedy against them.26 Thus, they cannot be considered possessors nor builders in
good faith. It is well-settled that both Article 44827 and Article 54628 of the New Civil Code which allow full
reimbursement of useful improvements and retention of the premises until reimbursement is made, apply
only to a possessor in good faith, i.e., one who builds on land with the belief that he is the owner
thereof.29 Verily, persons whose occupation of a realty is by sheer tolerance of its owners are not
possessors in good faith. Neither did the promise of Concordia, Esperanza and Angelito Pada that they
were going to donate the premises to petitioners convert them into builders in good faith for at the time the
improvements were built on the premises, such promise was not yet fulfilled, i.e., it was a mere expectancy
of ownership that may or may not be realized.30 More importantly, even as that promise was fulfilled, the
donation is void for Concordia, Esperanza and Angelito Pada were not the owners of Cadastral Lot No.
5581. As such, petitioners cannot be said to be entitled to the value of the improvements that they built on
the said lot.
Article 447
Using Materials of Another: Article 447 contemplates a situation where the landowner, either personally
or through the instrumentality of an agent, makes plantings, constructions or works on his own land but he
made use of materials belonging to another person; presumption is that the owner of the materials is in
good faith
Determining the Legal Consequences:
Both Acted in Good Faith,

1) the one responsible for the attachment or incorporation, the landowner, is exonerated from punitive
liability and damages,
2) following the principle of accesio cedit principali, the landowner is given the right to appropriate what has
been built, planted or sown but with the obligation to indemnify the owner for the value of the materials
following the principle that no one should unjustly enrich himself at the expense of another,
3) Instead of appropriating the materials, can the landowner choose to return the same to its owner?
Art 447 grants the right to demand for the removal and return of the materials only to the owner of the
materials if such removal can be done without injury to the work constructed or without the plantings,
constructions or works being destroyed;
Both Acted in Bad Faith

(bad faith of one party is neutralized by the bad faith of the other and both should be considered as having
acted in good faith, the legal effects discussed above shall likewise apply);
landowner is considered in good faith if he honestly believed that the materials were his at the time that he
made use of them, but if he was aware that he had no right to make use of the materials at the time that he
made use of them, he is considered to have acted in bad faith;
the owner of the materials is considered in good faith if he was not aware that his materials were being
used by landowner at the time of the construction, planting, or work and that he came to know of it only
after the materials have already been used by the landowner, but if he knew at the time of the construction,
planting or work that his materials were being used by another but he did not object thereto he is
considered to have acted in bad faith
Landowner in Bad Faith, Owner of the Materials in Good Faith,

1) landowner is liable to the owner of the materials for damages,
2) landowner shall also suffer other unfavorable consequences of his act, such that the law grants the
owner of the materials the option to a) demand for the value of the materials with a right to be indemnified
for damages, or b) demand for the removal of the materials in any event – even if it will cause injury to the
land or to the materials – with a right to be indemnified for damages, c) without prejudice to the criminal
liability of the landowner
Landowner in Good Faith, Owner of the Materials in Bad Faith,

not governed by Art 447 since the presumption is that the owner of the materials is in good faith;
what is applicable is Art 455 and 449 to the effect that the owner of the materials who acted in bad faith
loses his materials without any right whatsoever and is furthermore liable to the landowner for damages
Article 448 – 454
Building with One’s Own Materials on the Land of Another:

Art 448 until 454 contemplates a situation where a person built, planted, or sown on the land of another but
he made use of materials belonging to him
Determining Legal Consequences:

Art 448 applies only when the builder, planter, or sower believes he had the right so to build, plant or sow
because he thinks he owns the land or believes himself to have a claim of title;
does not apply where one’s only interest in the land is that of a lessee under a rental contract; cannot apply
to a lessee because he knows that he is not the owner of the leased premises (Art 1678 provides that a
lessee who introduced useful improvements on the leased premises in good faith, without altering the form
or substance of the leased property is entitled to ½ of the value of the improvements from the lessor upon
termination of the lease)
Art448 cannot apply where a co-owner builds, plants or sows on the land owned in common for then he did
not build, plant or sow upon land that exclusively belongs to another but of which he is a co-owner; when
co-ownership is terminated by a partition and it appears that the house of an erstwhile co-owner has
encroached upon a portion pertaining to another co-owner which was however made in good faith, then the
provisions of Art 448 should apply to determine the respective rights of the parties
Both Acted in Good Faith,

Landowner is given two alternatives: 1) to appropriate as his own the works, sowing or planting after
payment to the builder, planter, or sower of the necessary and useful expenses, and in proper cases,
expenses for pure luxury or mere pleasure, or 2) to oblige the one who built or planted to pay the price of
the land, if the value of the land is not considerably more than that of the building or trees, and the one who
sowed, the proper rent;
This option is exercised by landowner because his right is older and because, by principle of accession, he
is entitled to the ownership of the accessory thing;
The only right given to the builder in good faith is the right to reimbursement for the improvements; the
builder cannot compel the owner of the land to sell such land to the former;
Landowner cannot refuse to exercise either option and compel instead the owner of the building or
improvement to remove it from the land;
Remotion is available only if and when the owner of the land chooses to compel the builder to buy the land
at a reasonable price but the latter fails to pay such price;
Where the landowner is refusing to exercise any of the options, the 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;
Indemnities:
landowner must pay the necessary and useful expenses, and in the proper case, expenses for pure luxury
or mere pleasure;
for necessary expenses, good faith or bad faith does not matter; the difference between the two being that
in good faith has right of retention while in bad faith has no right of retention
Basis of Indemnity: based on the current market value of the said improvements
Pending reimbursement, Builder has Right of Retention:

In addition to the right of the builder in good faith to be paid the value of his improvement, he also has the
corollary right of retention of the property until he is indemnified by the owner of the land;
A builder in good faith cannot be compelled to pay rentals during the period of retention nor be disturbed in
his possession by ordering him to vacate;
The owner of the land is prohibited from offsetting or compensating the necessary and useful expenses
with the fruits received by the builder-possessor in good faith;
Option to Compel Builder or Planter to Buy the Land:

If the landowner elected to compel the builder or planter to pay the price of the land, then said builder or
planter must do so, unless the value of the land is considerably more than that of the building or trees, in
which case, the builder or planter must pay reasonable rent if the landowner does not choose to
appropriate the building or trees;
If the parties cannot agree over the conditions of lease, the courts will fix the terms;
This option not available with respect to sower, since the landowner can only compel him to pay the proper
rent in case the landowner does not choose to appropriate the crops;
Remedy if Builder or Planter Refuses to Pay:

In situations where the landowner cannot oblige the builder or planter to pay the price of the land because
its value is considerably more than that of the building or trees, they may enter into “forced lease”;
If the landowner can compel the builder or planter to pay the price of the land because its value is not
considerably more than that of the building or trees and the builder fails to pay such price, the parties may
agree to assume the relation of lessor-lessee, but must be voluntarily
Should the parties do not agree to leave things as they are and to assume the relation of lessor-lessee, the
owner of the land is entitled to have the improvement removed when after having chosen to sell his land to
the other party (the builder in good faith), fails to pay for the same;
Landowner in Good Faith, Builder in Bad Faith,

Builder in bad faith if he knows that the land is not his, or if he has knowledge of any flaw or defect in his
title or mode of acquisition of the land;
The landowner an exercise any of the 3 rights:
1) right to appropriate: he can appropriate what has been built, planted or sown on his land in bad faith
without any obligation to pay indemnity; can also demand damages
2) right of remotion: landowner can demand that what has been built, planted or sown in bad faith on his
land be removed or demolished and that the land be restored to its original condition at the expense of the
builder plus damages
3) right to compel payment of the price of the land: compel the builder or planter to pay the price of the
land, and the sower the proper rent
Landowner may exercise only one of the 3 rights;
Builder, planter or sower in bad faith is entitled to reimbursements for necessary expenses, based on the
principle against unjust enrichment;
Both Acted in Bad Faith,

Bad faith of one person neutralizes the bad faith of another and both should be considered as having acted
in good faith;
Landowner in bad faith if the act was done with his knowledge and without opposition on his part;
Landowner in Bad Faith, Builder in Good Faith,

Art 447 applies, the owner of the materials (who is at the same time the builder, planter or sower in this
case) acquires 2 alternative rights: 1) to demand the value of his materials plus damages, or 2) to demand
the return of his materials in any event plus damages
Building on Another’s Land Using Another’s Materials: Art 455, 3 persons involved, 1) landowner, 2)
builder, planter, or sower, and 3) owner of materials;
Determining the Legal Consequences:
If the Owner of the Materials Acted in Bad Faith,

He loses his materials without indemnity; exception, if all parties acted in bad faith because then their rights
would be governed as if they were in good faith;
Landowner can claim what has been built, planted or sown on his land without any obligation to indemnify
the owner of the materials;
Rights of the Builder, Planter or Sower: 1) if he acted in good faith, he may claim from the landowner a
reasonable compensation for his labor, 2) if he acted in bad faith, he is not entitled to anything, may be
made to pay damages to landowner;
If the Owner of the Materials Acted in Good Faith,

He is entitled to recover the value of his materials;
Builder, planter or sower is primarily liable to make such payment to the owner of the materials (without
damages if in good faith, with damages if in bad faith);
Once such payment is made then in essence, the builder becomes the owner of the materials;
Hence to determine the rights and obligations of the builder and the landowner against each other, the
rules are as follows:
1) if both the landowner and the builder acted in good faith (refer above under topic Art 448-454, both acted
in good faith)
2) if the landowner acted in good faith and the builder in bad faith (refer above under topic Art 448-454,
landowner in good faith, builder in bad faith)
3) if both acted in bad faith (refer above under topic Art 448-454, both acted in bad faith)
4) if the landowner acted in bad faith and the builder acted in good faith (refer above under topic Art 447,
landowner in bad faith, builder in good faith);
Landowner is subsidiarily liable for the payment of the value of the materials only if, a) builder is insolvent,
b) owner of the land appropriates the building, planting or sowing;
Alluvion, Requisites, and Riparian Owner:
Alluvion: gradual and imperceptible addition to the banks of rivers
Riparian Owners: owner of the estate fronting the river bank is called riparian owner; owners of lands
bordering the shore of the sea or lakes or other tidal waters are littoral owners
Rule on Alluvion:
Art 457, to the owners of lands adjoining the banks of rivers belong the accretion which they gradually
receive from the effects of the current of the waters;
Alluvion is automatically owned by the riparian owner from the moment the soil deposit can be seen, the
reason being to compensate the riparian owner for the danger of loss that he suffers because of the
location of his land;
Requisites of Alluvion:
1) accumulation is gradual and imperceptible
2) result of the action of the waters of the river
3) land where the accretion takes place is adjacent to the banks of the river (accretion that takes place on
the shore of the Manila Bay, it being an inlet or an arm of the sea, is part of the public domain; by express
mandate of the Spanish Law of Waters, accretion that takes place on a lake belongs to the owners of the
land contiguous thereto
CASE PRINCIPLES:
GRANDE ET AL VS COURT OF APPEALS

Issue:
Whether respondents have acquired the alluvial property in question through prescription.
Held:
There can be no dispute that both under Article 457 of the New Civil Code and Article 366 of the old,
petitioners are the lawful owners of said alluvial property, as they are the registered owners of the land
which it adjoins.
The question is whether the accretion becomes automatically registered land just because the lot which
receives it is covered by a Torrens title thereby making the alluvial property imprescriptible.
We agree with the Court of Appeals that it does not, just as an unregistered land purchased by the
registered owner of the adjoining land does not, by extension, become ipso facto registered land.
Ownership over the accretion received by the land adjoining a river is governed by the Civil Code.
Imprescriptibility of registered land is provided in the registration law. Registration under the Land
Registration and Cadastral Acts does not vest or give title to the land, but merely confirms and thereafter
protects the title already possessed by the owner, making it imprescriptible by occupation of third parties.
But to obtain this protection, the land must be placed under the operation of the registration laws wherein
certain judicial procedures have been provided. The fact remain, however, that petitioners never sought
registration of said alluvial property up to the time they instituted the present action in the Court of First
Instance of Isabela. The increment, therefore, never became registered property, and hence is not entitled
or subject to the protection of imprescriptibility enjoyed by registered property under the Torrens system.
Consequently, it was subject to acquisition through prescription by third persons.
The next issue is, did respondents acquire said alluvial property through acquisitive prescription?
This is a question which requires determination of facts: physical possession and dates or duration of such
possession. The Court of Appeals, after analyzing the evidence, found that respondents-appellees were in
possession of the alluvial lot since 1933 or 1934, openly, continuously and adversely, under a claim of
ownership up to the filing of the action in 1958. This finding of the existence of these facts, arrived at by the
Court of Appeals after an examination of the evidence presented by the parties, is conclusive as to them
and can not be reviewed by us.
The law on prescription applicable to the case is that provided in Act 190 and not the provisions of the Civil
Code, since the possession started in 1933 or 1934 when the pertinent articles of the old Civil Code were
not in force and before the effectivity of the new Civil Code in 1950. Hence, the conclusion of the Court of
Appeals that the respondents acquired alluvial lot in question by acquisitive prescription is in accordance
with law.
REPUBLIC OF THE PHILS VS CA

The petitioner submits that there is no accretion to speak of under Article 457 of the New Civil Code
because what actually happened is that the private respondents simply transferred their dikes further down
the river bed of the Meycauayan River, and thus, if there is any accretion to speak of, it is man-made and
artificial and not the result of the gradual and imperceptible sedimentation by the waters of the river.
The private respondents submit that the foregoing evidence establishes the fact of accretion without human
intervention because the transfer of the dike occurred after the accretion was complete.
We agree with the petitioner.
Article 457 of the New Civil Code provides:
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.
The above-quoted article requires the concurrence of three requisites before an accretion covered by this
particular provision is said to have taken place. They are (1) that the deposit be gradual and imperceptible;
(2) that it be made through the effects of the current of the water; and (3) that the land where accretion
takes place is adjacent to the banks of rivers.
Alluvion must be the exclusive work of nature. In the instant case, there is no evidence whatsoever to prove
that the addition to the said property was made gradually through the effects of the current of the
Meycauayan and Bocaue rivers. We agree with the observation of the Solicitor General that it is
preposterous to believe that almost four (4) hectares of land came into being because of the effects of the
Meycauayan and Bocaue rivers.
The reason behind the law giving the riparian owner the right to any land or alluvion deposited by a river is
to compensate him for the danger of loss that he suffers because of the location of his land.
Hence, the riparian owner does not acquire the additions to his land caused by special works expressly
intended or designed to bring about accretion. When the private respondents transferred their dikes
towards the river bed, the dikes were meant for reclamation purposes and not to protect their property from
the destructive force of the waters of the river.
Avulsion, Change of River Bed, Formation of Islands
CASE PRINCIPLE:
DIONESIA BAGAIPO VS COURT OF APPEALS

Held:
The rule is well-settled that accretion benefits a riparian owner when the following requisites are present:
1) That the deposit be gradual and imperceptible; 2) That it resulted from the effects of the current of the
water; and 3) That the land where accretion takes place is adjacent to the bank of the river.[13] These
requisites were sufficiently proven in favor of respondents. In the absence of evidence that the change in
the course of the river was sudden or that it occurred through avulsion, the presumption is that the change
was gradual and was caused by alluvium and erosion.
The fact that the accretion to his land used to pertain to plaintiff’s estate, which is covered by a Torrens
certificate of title, cannot preclude him (defendant) from being the owner thereof. Registration does not
protect the riparian owner against the diminution of the area of his land through gradual changes in the
course of the adjoining stream. Accretions which the banks of rivers may gradually receive from the effect
of the current become the property of the owners of the banks (Art. 366 of the old Civil Code; Art. 457 of
the new). Such accretions are natural incidents to land bordering on running streams and the provisions of
the Civil Code in that respect are not affected by the Land Registration Act.
Avulsion: accretion which takes place when the current of a river, creek or torrent segregates a known
portion of land from an estate on its banks and transfers it to another estate
Comparison with Alluvion:

1) alluvion, deposit is gradual; avulsion, sudden and abrupt
2) alluvion, deposit belongs to owner of the property where the same was deposited; avulsion, owner of the
property from which a part was detached retains ownership
3) alluvion, accession takes place immediately upon deposit of the soil; avulsion, right of accession takes
place only after 2 years from the attachment or incorporation of the segregated portion of land to the
riparian land and only if its owner fails to remove the same within said period
4) alluvion, soil cannot be identified; avulsion, detached portion can be identified
Rule on Avulsion:
Owner of land from where the portion is detached retains ownership thereof only if such owner physically
removes the portion detached from his land, a mere claim being insufficient;
Right of accession takes place only after 2 years from the attachment or incorporation of the segregated
portion of and to the riparian land upon failure of its owner to remove the same within said period
Change of Course of River, Change of Riverbed:
Riverbed: property of public dominion; if dries up, still property of public dominion;
If you are owner of land traversed by new river, you will be compensated and own the former river bed;
Adjacent owner of old river bed has the right to indemnify the owner of the land traversed by the new river;
If owner of land traversed by new river does not accept offer of indemnity by adjacent owner or if both of
them interested to acquire the abandoned river bed, the one who has preferential right is the adjacent
owner of the old riverbed (reason: practicality);
Before you can claim ownership of old riverbed, you have to prove the former course of the old river;
otherwise you cannot invoke the benefits;
What right does the owner of the land traversed by the new river has when the government seeks to
traverse the river back to its old course? The owner cannot stop the government from taking steps in
reverting the river back to its original course. There is no automatic abandonment on the part of the
government just because there is change in course of river. Still, you must prove existence or proof of
former course of the old river. (Art 58, Water Code of the Phils, PD 1067)
If there is natural change in the course of the waters of the river, the abandoned riverbeds shall ipso facto
belong to the owners whose lands are occupied by the new course in proportion to the area lost;
No accession because the owner of the land is merely compensated for the area that he lost, nothing has
been added to his property;
Formation of Island:
If the current of a river simply divides itself into branches, leaving a piece of land or part thereof isolated
thereby forming an island, the island remains to be the property of the owner of the land where such island
has been formed (Art 463);
If an island is formed on a sea, lake or navigable or floatable river through whatever cause, it forms part of
the patrimonial property of the Sate and therefore may be sold by the State (Art 464);
If an island is formed in non-navigable or non-floatable rivers through successive accumulation of deposit in
the same manner as alluvion, a) belong to the owner of the margins or banks nearest to the island, b) if the
island is in the middle of the river, owner by the owners of both margins which shall be divided
longitudinally in halves, c) if the island be more distant from one margin than from the other, the owner of
the nearer margin shall be the sole owner thereof (Art 465)
Note from Atty. G: navigable or floatable means that the river may be used in relation to commerce. If not, it
is non-navigable or non-floatable
SPOUSES BAES VS COURT OF APPEALS

Issue:
Whether or not Baes is the owner of Lot 1-B (TCT No. 14405), relying on Article 461 of the Civil Code.
Held:
No, Article 461 of the Civil Code provides that “River beds which are abandoned through the natural
change in the course of the waters ipso facto belong to the owners whose lands are occupied by the new
course in proportion to the area lost. However, the owners of the lands adjoining the old bed shall have the
right to acquire the same by paying the value thereof, which value shall not exceed the value of the area
occupied by the new bed.” Article 461 refers to a natural change in the course of a stream. If the change of
the course is due to works constructed by concessioners authorized by the government, the concession
may grant the abandoned river bed to the concessioners. If there is no such grant, then, by analogy, the
abandoned river bed will belong to the owners of the land covered by the waters, as provided in this article,
without prejudice to a superior right of third persons with sufficient title.
If the riparian owner is entitled to compensation for the damage to or loss of his property due to natural
causes, there is all the more reason to compensate him when the change in the course of the river is
effected through artificial means. Baes’ loss of the land covered by the canal was the result of a deliberate
act on the part of the government when it sought to improve the flow of the Tripa de Gallina creek. It was
therefore obligated to compensate the Baeses for their loss.
Moreover, Baes has already been compensated as there has been a fair exchange of Lot 3271-A
belonging to the Government and Lot 2958-B belonging to Baes, which were similar in area and value,
through a Deed of Exchange of Real Property which the parties freely entered into. Baes cannot claim
additional compensation because allowing Baes to acquire ownership of the dried-up portion of the creek
would be a clear case of double compensation and unjust enrichment at the expense of the state. The
exchange of lots between the petitioners and the Republic was the result of voluntary negotiations. If these
had failed, the government could still have taken Lot 2958-B under the power of eminent domain, upon
payment of just compensation, as the land was needed for a public purpose.
MARIO RONQUILLO VS COURT OF APPEALS

A careful perusal of the evidence presented by both parties in the case at bar will reveal that the change in
the course of Estero Calubcub was caused, not by natural forces, but due to the dumping of garbage
therein by the people of the surrounding neighborhood.
Article 370 applies only if there is a natural change in the course of the waters. The rules on alluvion do not
apply to man-made or artificial accretions nor to accretions to lands that adjoin canals or esteros or artificial
drainage systems. Considering our earlier finding that the dried-up portion of Estero Calubcub was actually
caused by the active intervention of man, it follows that Article 370 does not apply to the case at bar and,
hence, the Del Rosarios cannot be entitled thereto supposedly as riparian owners.
The dried-up portion of Estero Calubcub should thus be considered as forming part of the land of the public
domain which cannot be subject to acquisition by private ownership.
Right of Accession with respect to Movable Property: 3 forms of accession continua, 1) adjunction or
conjunction, 2) commixtion or confusion, 3) specification
Criteria to determine principal: 3 tests, 1) that to which the other has been united as ornament or for its
use or perfection is the principal, the thing added is the accessory, 2) if the first test cannot be applied, then
the thing of greater value is the principal and the other the accessory, 3) if both things are of equal value,
then the one of greater volume is the principal and the other the accessory
Adjunction, Mixture, and Specification:
Adjunction:
takes place when 2 or more movable things belonging to different owners are so united that they cannot be
separated without causing injury to one or both of them, thereby giving rise to a new thing;
features, 1) 2 or more movables form a distinctive new thing, 2) each one of the things making up the new
one preserves its own nature;
takes place by, 1) inclusion or engraftment, 2) soldadura or attachment, 3) tejido or weaving, 4) pintura or
painting, 5) escritura or writing
Legal Effects of Adjunction:
If Effected in Good Faith,

The owner of the principal thing acquires the accessory following the principle in accession continua that
the accessory follows the principal, but he must indemnify the owner of the accessory for its value following
the principle that no one shall unjustly enrich himself at the expense of another;
If the accessory is much more precious than the principal thing, its owner may demand its separation, even
though the principal may suffer injury;
If Effected in Bad Faith,

Depending on who was responsible,
1) If Effected in Bad Faith by the Owner of the Principal, the owner of the accessory may choose, 1)
demand payment for the value of accessory, with a right to indemnified for damages, or 2) demand for
separation of the accessory (even though it be necessary to destroy the principal), with a right to be
indemnified for damages, except in impracticable cases such as painting or writing
2) If Effected in Bad Faith by the Owner of the Accessory, owner of the accessory shall lose the thing
incorporated (the accessory) and shall be liable to pay damages to the owner of the principal
3) If Both Acted in Bad Faith, determined as though both acted in good faith
Commixtion: refers to mixture of two or more things belonging to different owners; commixtion if solid,
confusion if liquid
Legal Effects of Commixtion or Confusion:

Depending on the manner by which the mixture occurs,
Co-ownership: if the mixture takes place by, 1) will of both owners, 2) will of only one owner acting in good
faith, 3) chance or fortuitous event, each owner shall acquire a right proportional to the part belonging to
him, bearing in mind the value of the thing mixed or confused
If Caused By Only One Owner Acting in Bad Faith: if the mixture is caused by only one owner acting in
bad faith, he loses the thing belonging to him thus mixed or confused, besides being obliged to pay
indemnity for the damages caused to the owner of the thing with which his own was mixed or confused
Specification: takes place whenever the work of a person is done on the material of another, such
material, in consequence of the work itself, undergoing a transformation; involves 1) the labor of the
worker, and 2) the materials of another
Legal Effects:
If the Worker Acted in Good Faith: appropriate the thing thus transformed as his own, indemnifying the
owner of the material for its value; exception, when the material is more precious than the transformed
thing or more valuable, in which case the owner may 1) appropriate the new thing to himself after paying
indemnity for the value of the work, or 2) demand indemnity for the material
If the Worker Acted in Bad Faith: owner of the material may 1) appropriate the work for himself without
paying anything to the maker, or 2) demand of the worker that he indemnify him for the value of the
material and the damages he may have suffered; but if the value of the work is considerably more than that
of the material, the owner of the material cannot appropriate the work so the owner of the material can only
demand from the worker the value of his materials and damages
CASE PRINCIPLE:
SIARY VALLEY ESTATES INC VS LUCASAN & JUDGE ORTEGA

(can’t find the case)
QUIETING OF TITLE
Quieting of Title:
Purpose: quieting of title or removal of cloud therefrom when there is an apparently valid or effective
instrument or other claim which in reality is void, ineffective, voidable or unenforceable
common law remedy for the removal of any cloud upon or doubt or uncertainty with respect to title to real
property (Rabuya);
proceeding quasi in rem and judgment is conclusive only between parties
Note from Atty. G: cloud cast upon a title is when there is disturbance upon said title
Action for Reconveyance and Action to Quiet Title is basically the same because you are seeking to end
all ‘attacks’ on your title
Requisites:
1) plaintiff or complainant has a legal or an equitable title to or interest in the real property subject of the
action (not necessary that person seeking to quiet his title be the registered owner of the property in
question; it can connote acquisitive prescription by possession in the concept of an owner thereof)
2) there is a cloud on title to real property or any interest therein (cloud on title is a semblance of title which
appears in some legal form but which is in fact unfounded
3) 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
Prescription: in an action to quiet title, the plaintiff need not be in possession of the property; if the plaintiff
in an action for quieting of title is in possession of the property being litigated, the action is imprescriptible
CASE PRINCIPLES:
GALLAR VS HUSAIN
Gallar contests that
Instance where a quieting of title action be resorted to as remedy. There was perfected contract of
sale but this was in a private document. This is a valid sale but this cannot be registered because
for a document to be registrable it must be in a public instrument. Remedy for this is to compel
execution of public document. This, in itself, is an action to quiet title. Requisite that document
which you seek to be declared void must be valid on its face. If it is void on its face, it does not
create doubt on your title, thus an action to quiet title is not applicable.
Note from Atty. G: quieting of title has many forms such as in this instance; a forged deed of sale
may
CORONEL VS IAC
CARAGAY-LAYNO VS COURT OF APPEALS

Petitioner in this case did not take action to recover land, but this is not necessary because all the time, he
has been in possession. IF you are not in possession, the action may prescribe within 10 years
An action for Quieting of Title is not a remedy to settle a boundary dispute:
CASE PRINCIPLE:
ANASTACIA VDA DE AVILES VS CA

Quiet title cannot be resorted to in boundary disputes. In boundary disputes, if assuming that it is
your land that is being encroach, the proper action is a case for forcible entry or an accion
publiciana.
Prescriptive Period to file an action to quiet title:
If plaintiff is in possession, the action does not prescribe;
If plaintiff is not in possession, the action may prescribe
CASE PRINCIPLE:
AZNAR BROTHERS REALTY COMPANY VS AYING

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OUTLINE IN PROPERTY

A. Property, Concept of Things, Susceptibility of Appropriation etc, Right to Property, and

Things – embraces both material objects and rights

Classes of Immovables (Art 415):

Real Property under Par 2:

Real Property under Par 3:

Real Property under Par 4:

Real Property under Par 5:

Real Property under Par 6:

Real Property under Par 7:

Real Property under Par 8:

Real Property under Par 9:

Real Property under Par 10:

Concept of Real Property in Real Estate Taxation:

LEUNG YEE VS STRONG MACHINERY

STANDARD OIL CORP VS JARANILLO

DAVAO SAWMILL VS CASTILLO

MAKATI LEASING AND FINANCE CORP VS WEAREVER TEXTILE MILLS INC

MINDANAO BUS COMPANY VS CITY ASSESSOR

CALTEX PHILS INC VS CENTRAL BOARD OF ASSESSMENT APPEALS

MANILA ELECTRIC COMPANY VS CBAA

General Test of Movable Character:

UNITED STATES VS IGNACIO CARLOS

LUIS MARCOS LAUREL VS HON ZEUS ABROGAR

PROPERTY IN RELATION TO THE PERSON TO WHOM IT BELONGS

PROPERTY OF PUBLIC DOMINION

Characteristics of Properties of Public Dominion:

Doctrine of Equitable Estoppel (against the Government)

ESTATE OF YUJUICO VS REPUBLIC OF THE PHILIPPINES

LAND BANK OF THE PHILS VS REPUBLIC OF THE PHILS

DENR VS MAYOR YAP

Prescription as a mode to acquire ownership over public agricultural lands

HEIRS OF MARIO MALABANAN VS REPUBLIC OF THE PHILIPPINES

Property of Public Dominion:

Ports: includes seaports and airports

Property of Public Dominion:

MUNICIPALITY OF CAVITE VS ROJAS

IGNACIO VS DIRECTOR OF LANDS

PHILIPPINE FISHERIES DEVELOPMENT AUTHORITY VS CA

WOODRIDGE SCHOOL INC VS ARB CONSTRUCTION

Foreshore lands: not subject to sale; only lease

CHAVEZ VS PUBLIC ESTATES AUTHORITY

PATRIMONIAL PROPERTY OF THE STATE

Not Susceptible of Acquisitive Prescription:

Conversion: From Public Dominion to Patrimonial Property:

CHAVEZ VS NATIONAL HOUSING AUTHORITY

CEBU OXYGEN & ACETYLENE CO INC VS BERCILLES

Property of Provinces, Cities, and Municipalities:

Provincial roads, city streets and municipal streets:

VDA DE TAN TOCO VS MUNICIPAL COUNCIL OF ILOILO

PROVINCE OF ZAMBOANGA DEL NORTE VS CITY OF ZAMBOANGA

MANILA LODGE 761 VS COURT OF APPEALS

Government funds, garnishment of:

COMMISSIONER OF PUBLIC HIGHWAYS ET AL VS LOURDES SAN DIEGO

Funds of “government-owned” corporations:

PROFESSIONAL VIDEO INC VS TESDA

Right to Recover: Right to Possession: possession as an incident of ownership or a right included in

Forcible Entry and Unlawful Detainer, Distinguished:

VILLA VS HEIRS OF ALTAVAS

ESTATE OF SOLEDAD MANANTAN VS ANICETO SOMERA

IGLESIA NI CRISTO VS HON. PONFERRADA

GERMAN MANAGEMENT & SERVICES INC VS COURT OF APPEALS

Acts in a State of Necessity: