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Renato P.

Magbalon III

Law on Property; Memory Aid

Ownership

 Davao Sawmill – Machineries which are 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 tenant only having a temporary right
to the possession cannot be presumed by law to have applied movable property belonging to him so as to deprive
him of it by causing it by an act immobilization to become the property of another. (Who in the right mind will do
that?)

 Berkenkotter – Installation of additional machineries necessary for the utility of the sugar central. Real property
mortgaged was attached to the land and building, Berkenkotter contends that the machineries be saved since it is
not real property. Court held: Upon installation of the additional machineries and equipment, they were then
converted to real property by reason of their purpose, it cannot be said that their incorporation were not
permanent in character because, as essential and principal element of a sugar central, without them the sugar
central would be unable to function the industrial purpose for which it was established.

 Lopez vs. Orosa – (Theatre) There was a mortgage over the building, the adverse party contends that it should
include the land where it was built. SC held: For while it is true that generally, real estate connotes the land and
building constructed thereon, it is obvious that the inclusion of the building, separate and distinct form the land, in
the enumeration of what may constitute real properties could only mean – that a building by itself an immovable
property, irrespective of whether or not said structure and the land on which it is adhered to belong to the same
owner.

 Tumalad vs. Vicencio – A house was subject of a chattel mortgage. Is a house considered a chattel? Yes. The that
parties to a deed of chattel mortgage may agree to consider a house as personal property for the purposes of said
contract “is good only insofar as the contracting parties are concerned”. It is partly based upon the principle of
estoppel”. It should be noted however that the principle is predicated on statements of the owner declaring his
house to a chattel, a conduct that may conceivably estop him from subsequently claiming otherwise. (Note:
Repeated herein, building is by itself an immovable, irrespective of the owner of the land.)

 Associated Insurance vs. Iya – House was subjected to chattel mortgage and a real property mortgage was executed
over the house and land. It was reasoned out that the first chattel mortgage is valid, since at the time the chattel
mortgage was executed, the land where the house was adhered was not yet under ownership of the mortgagee,
meaning to say, the house alone is a personal property without the land. SC held: A building certainly cannot be
divested of its character of a realty by the fact that the land on which it is constructed belongs to another.

 Makati leasing- Property in dispute is a drive motor attached to the ground by means of bolts, and separation
therefrom shall destroy the concrete floor. Is it personal property that can be the subject of a writ of replevin or a
chattel mortgage? Yes. Identical to the case of Tumalad, a real property by incorporation/nature may be considered
as personal property for puporses of executing a chattel mortage thereon as long as the parties to the contract so
agree and no innocent third party will be prejudiced. Estoppel steps in.

 Bd. Of Assessment vs. Meralco (Electric Poles) – Electric poles are personal properties. It is not under the
enumeration of real properties in the civil code. Art. 415, par. 1, 3 and 5.
 Meralco Securites vs. Central Bd. Assessment – Subject in dispute is a pipeline buried underground. The pipes are
embedded in the soil, welded together so as to preclude breakage. Is it real peroperty? Yes. Insofar the pipeline
system in question in indubitably a construction adhering to the soil. It is attached to the soil in such a way that it
cannot be separated therefrom without dismantling the steel pipes which were welded to from the pipelines.

 Meralco vs. Bd. Of Assessment (Oil Storage Tanks) – The oil storage tanks are not bolted nor welded to the ground,
they were merely sitting on a foundation enclosed in dike walls. Is it real property? Yes. The issue was resolved in
light of taxing laws which consider the storage tanks as improvements; enhancing its utility and rendering it useful
to the oil industry.

 Caltex vs. Bd. Of Assessment – Are gas station equipment real property? Yes. The issue was again resolved in light
of taxing laws. SC held: The machineries and equipment are necessary to the operation of the gas station. Hence,
they are taxable improvements and machinery. *this case is different from Davao Sawmill, since the interpretation
of Par. 5 of Art. 415 is for purposes of execution of judgment against the lessee. Here, the question is whether the
gas equipment are real properties subject to realty tax.

 Benguet Corp. vs. Bd. Of Assessment – The property in dispute to subject to realty tax is a tailing dam. Is it? Yes.
The issue was resolved not under the light of taxing laws but under Art. 415 of the NCC, par. 1 and 5. The SC is
convinced that the subject dam falls within the definition of an “improvement” because it is permanent in character
and it enhances both the value and utility of petitioner’s mine. (Search niyo meaning ng tailing dam, andon na sagot
:*)

 Usero – A creek forms part of public dominion. It falls under Art. 420 “others of similar character”.

 Tan Toco vs Municipal Council (Auto trucks, police mobile, concrete structures and corresponding lots) – Whether
a municipal’s property can be attached for execution? It must be qualified. Properties of the municipality used for
public purposes or governmental in character are exempt from execution; whereas, properties used for quasi-
private purposes, generally, may be seized and sold under execution. But property held for public purposes cannot
be subject to execution merely because it is temporarily used for private purposes.

 Province of Zamboanga (Control of congress with the properties of a municipality) – If the property is owned by the
municipality is owned by the municipality in its public and governmental capacity, the property is public and the
congress has absolute over it; if the property is owned in its propriety capacity, then it is patrimonial and congress
has no absolute control.

 Salas vs. Jarencio – Implementation of R.A 4118 was prayed to be restrained. Since it will deprive the City of Manila
of due process and just compensation. The lands in question are not owned by the City of Manila in its governmental
function. Although they contend that it is “commercial land”, it did not automatically became its property in the
absence of an express grant. The lands are only held in trust by the local government for the state in fulfillment and
enjoyment of communal benefit.

 Cebu Oxygen – The property in question is an abandoned road. Can the City of Cebu declare the road as abandoned
and shall result to its conversion to patrimonial property? Yes. LGC provides for it. Let us focus on Art. 422: 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.
 Gov. vs. Cabangis – Land in question was submerged under water (Manila Bay) and stayed at the same state until
government dig it up. Now, they are being reclaimed by the respondent. Who has a better right? The government.
Because of the reclamation of the government, the private property became part of public dominion. Under the
law of waters, lands reclaimed from the sea in consequence of works constructed by the state xxx with proper
permission shall become the property of the party constructing such works xxx.

 Hilario vs. Salvador – The original complaint was for ejectment before the RTC. The other part filed a motion to
dismiss on the ground of lack of jurisdiction, he contended that the assessment value of the land does not exceed
20k, as such, it falls under the jurisdiction of the MTC. But the other party defended that the court should have
judicial notice that his property is worth more than 20k, RTC should have jurisdiction. CA held however, that the
case filed was really for an accion reinvidicatoria. So, who has jurisdiction in this case? The issue laid down is actually
an accion publiciana and not an accion reivindicatoria. The only issue is that of possession and not ownership. Court
can neither have judicial notice of the value of the land. The value of the land should be the one reflected in the tax
declaration. In this case. The assessed value is below 20k, hence MTC has jurisdiction.

 Samapayan vs. CA – It must be noted that in forcible entry cases, prior physical possession is a requirement. Absence
of such warrants the dismissal of his complaint. In this case, the main evidence that was relied by thelower courts
is the cadastral opposition. However, being an oppositor in a cadastral case, by itself, does not establish physical
possession because not all oppositors in cadastral cases are actual possessors of the lots or lands subject thereof.

 Santos vs. Ayon – Under the Rules of Procedure, forcible entry and unlawful detainer cases should be filed with the
MTC, MCTC, or MTCC, which have primary jurisdiction. In this case, the allegations presented in the complaints,
recites of unlawful detainer. Hence, MCTC has proper jurisdiction. Further it bears stressing that possession by
tolerance is lawful, but such becomes unlawful when the possessor by tolerance refuses to vacate upon demand
by the owner. (Implied promise to vacate upon demand; mere tolerance without any contract)

 Ganila, et al. vs. CA – In unlawful detainer, prior physical possession is not necessary. What distinguishes an action
for unlawful detainer from a possessory action (accion publiciana) and from a reinvidicatory action is that the first
is limited to the question of possession de facto. With respect to tax declarations, they are good indicia of
possession if the condition of owner (although not conclusive), for no one in his righ mind would be paying taxes
for a property that is not in his actual/constructive possession.

 Ross Rica Sales – Ownership in an ejectment case is a bad defense. In ejectment cases, the issue to be resolved
whether or not there is a withholding of possession and there is no question with respect to ownership. The SC
ruled that before us is only the initial determination of ownership is inseparably linked thereto, as such, the lower
court’s adjudication of ownership in the ejectment case is merely provisional and it would not bar the same parties
bring an action involving the title to the property. The long-settled rule is that the issue of ownership cannot be
subject of a collateral attack.

 Petralba-Labrador – This case is one of recovery of possession and ownership, which turned out be one of forcible
entry. And since the case was filed 2 years after the intrusion, the cause for forcible entry had prescribed and the
MTC had no jurisdiction. The petitioner complaint therefore should have been filed with the proper RTC (Accion
publicana/reinvidicatoria).

 Seria vs. Caballero - Whether or not identity of the land is fatal in a land possession case? In order that an action
for recovery of possession may prosper, it is indispensable that he who brings the action fully proven not only his
ownership but also the identity of the property claimed, by ascribing the location, are and boundaries thereof. As
the appellate court succinctly stated, he who claims to have a better right to the property must clearly show that
the land possessed by the other party is the very land that belongs to him.

 Perez vs. Mendoza – Can a criminal case of falsification be considered as res judicata on a civil case of ownership of
the land? No. it is the rule that the plea of res judicata generally cannot be interposed except where the parties,
facts, and questions are the same, hence, the judgement in a criminal case cannot be pleaded as res judicata in a
civil action; what are the presumptions in favor of the possessors, if any? “Possession is an indicium of ownership
of the thing possessed and to the possessor goes the presumption that he holds the thing under claim of
ownership.”

 Dizon vs. CA – The land was already titled. Hence, it became indefeasible and incontrovertible. Further, in the
absence of a definite proof establishing respondent’s link/relationship to their alleged predecessors-in-interest,
they do not have any cause of action and suit for partition must necessarily fail.

 U.S vs. Causby – It is ancient doctrine that at common law, ownership of the land extends to the periphery of the
universe. But that doctrine has no place in the modern world. The air is a public highway it is part of the public
domain. In this case, there is a “taking”. Though it would only be an easement of flight. Flights over private land are
not a taking, unless they are so low and so frequent as to be a direct and immediate interference with the enjoyment
of the land.

 Lunod vs. Meneses – This case concerns an easement on the flow of waters of the higher estate to the lower estate.
According to the Civil Code, an easement is a charge imposed upon one estate for the benefit of another estate
belonging to different owner, and the realty in favor of which the easement is established is called the dominant
estate and the one charged with it is called the servient estate. Although no agreement was constructed between
the parties, the easement is of a statutory nature, and the law had imposed it for the common utility in view of the
difference in the altitude of the land.
 Bahrach vs. Seifert – The usufructuary shall be entitled to receive all the natural, industrial and civil fruits of the
property in usufruct. The question now is, whether a dividend is an income and whether it should go to the
usufructuary. The dividend is considered as a civil fruit. They represent as profit. Hence, it should go to the
usufructuary.

 Bahrach vs. Talisay-Silay – Whether or not a “bonus” is considered a civil fruit? It is not. As the Civil Code considers
three things as civil fruits: First, the rents of buildings; second, the proceeds from leases of lands; third, the income
from perpetual or life annuities, or other similar sources of revenue. Bonus does not fall under the three.
 Bernardo vs. Bataclan – In this case, the builder in good faith was not awarded with the land. Instead, it was
subjected to public auction and the same was acquired by a third person, which is an error of the SC. This was a
result of the refusal of the land owner to choose the option of selling the land to the BPS in good faith or buying
the improvements.

 Ignacio vs. Hilario – In this case, the theory of remotion was discussed. The only time that the landowner can ask
the builder in good faith to remove the improvements at their cost, is when after choosing to sell the land, the
latter fails to pay. There can be no remotion when the land owner refuses to exercise his option to choose wheter
to appropriate the improvements unto himself after paying the builder in good faith or to sell the land.
 Depra vs. Dumlao – In this case, the BPS in good faith encroached the LO’s kitchen. The lower court ordered a
“forced lease”. Then after, when the case was appealed and the appellate court ordered to remove the
improvements because the LO failed to exercise his option to either buy the improvements or sell the land to the
BPS in good faith. The SC held that this case was a complete contravention of the doctrine laid down in Ignacio vs.
Hilario.

 Technogas vs. Uy – The question herein is whether or not Technogas be considered as a BPS in bad faith since it
ought to know the metes and bounds of the land it bought, since there is a discrepancy in the TCT. The SC held that
although Technogas is not the one who built the improvements but is merely a buyer in good faith, there was no
evidence to overthrow the presumption of good faith. Further, when Technogas bought the lot it was subrogated
to the seller’s shoes who is also in good faith. Technogas cannot be ordered to demolish its property or to be forced
to sell his land. There can only be remotion when the LO chooses to sell his land and the BPS fails to pay for the
same.

 Ortiz vs. Kayanan –This case concerns a BPS’ right of retention. There is no question that a possessor in good faith
is entitled to the fruits received before the possession is legally interrupted. Hence, all the fruits that the possessor
may receive from the time he is summoned in court, or when he answers the complaint, must be delivered and
paid by him to the owner. However, even after his good faith ceases, the possessor in fact can still retain the
property, until he has been fully reimbursed for all the necessary and useful expenses made by hum on the property.
* The right of retention in this case is analogous to a contract of antichresis, According to Manresa, the right of
retention, is therefore, analogous to that of a pledge, if the property retained is movable, and that of antichresis, if
the property held is immovable.

 Chico vs. CA – A group of vendees are lessees of stalls in a public market owned by the municipality. The public
market was burned down and the vendors re-constructed their stalls and contending that they should be deemed
as BPS in good faith. The SC said they are not. To be deemed as BPS in good faith, it is essential that a person assert
title to the land on which he builds; that he be a possessor in the concept of owner. A lessor can never be a possessor
in the concept of owner, he knows from the start that he is not the owner of the land.

 Felices vs. Ariola – May appellant recover or be reimbursed the value of his improvements on the land in question
on the theory as both he and the appellee knew that their sale was illegal and void, they were both in bad faith and
consequently, Art. 453 of the Civil Code applies in that “the rights of one and the other shall be the same as though
both acted in good faith? No. The rule Art. 453 of The Civil Code invoked by the appellant cannot be applied to the
instant case for the reason that the lower court found, and appellant admits, that the improvements in question
were made on the premises only after appellee had tried to recover the land in question from appellant, and even
during the pendency of this action in the court below. After appellant had refused to restore the land to the
appellee, to the extent that the latter even had to resort to the present action to recover her property, appellee
could no longer be regarded as having impliedly assented or conformed to the improvements thereafter made by
the appellant on the premises. Upon the other hand, appellant, recognizing as he does appellees right to get back
his property, continued to act in bad faith when he made improvements on the land in question after he had already
been asked extra-judicially and judicially to surrender and return its possession to appellee; and as a penalty for
such bad faith, he must forfeit his improvements without any right to reimbursement therefor. “He who builds,
plants, sows in bad faith on the land of another, loses that is built, planted, or sown without right to indemnity”
(Art. 449, NCC)

 Sps. Nuguid vs. CA – Accordingly, a builder in good faith cannot be compelled to pay rentals during the period of
retention nor he be disturbed in his possession by ordering him to vacate. In addition, as in this case, 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. Otherwise, the security provided by law would be impaired. This is so
because the right to the expenses and the right to the fruits both pertain to the possessor, making compensation
judicially impossible, and one cannot be used to reduce the other.

 Republic vs. CA –The herein respondent transferred the dikes located in his property, thus, forming an accretion to
his land since his property is adjacent to the Bocaue River. Now, he wishes to register the additional land, will it
prosper? No. Here the riparian owner acquired the accretion by means of special works expressly intended to bring
about the same. When the private respondents transferred their dies 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.

 Grande vs. CA – Can an accretion be owned by prescription, wherein the mother land to which it was attached is
registered under the Torrens system? Yes. For a piece of land to be imprescriptible, it must be brought under the
Torrens system. The fact remains however, that petitioner’s never sought registration of the said alluvial property
up to the time they instituted the present action, to quiet title. 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.

 Cureg vs. CA – A case of “mother land” vis-à-vis “subject land”, the latter allegedly to be an accretion. It was found
that the alleged “mother land” claimed by the respondent is non-existent. The “subject land” is an alluvial deposit
let the northern movement of the Cagayan River and pursuan to Art. 457 of the NCC: “To the owners of the land
adjoining the banks of river belong the accretion which they gradually receive from the effects of the current of the
waters.” However, it should be noted, the increase in area of petitioner’s land being an accretion does not
automatically become registered land just because the lot which receives such accretion is covered by a Torrens
title. As such, it must also be placed under the operation of the Torrens System.

 Meneses vs. CA – In this case, it was argued that the respondent cannot acquire the accretion brought about by
Laguna Bay, since it forms part of the public domain. However, the SC held, citing Colegio de San Jose case that
Laguna Bay is a Lake. Meaning, under the definition of an accretion under the Civil Code that can be brought about
by the current of a river or LAKE can bring about accretion. And the Accretion shall pertain to the riparian owner.

 Heirs of Navarro vs. IAC –This case is a dispute with respect to an accretion brought about by the Manila Bay. The
SC held that vis-à-vis Laguna de bay, the latter as a lake can give accretion to riaparian owners, while the Manila
bay cannot, since it is part of the sea, hence, it is part of the public domain and cannot be acquired by private
persons.

 Baes vs. CA – 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. The loss to the petitioners 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 Baes for their loss. However, the petitioners have already been so
compensated in this case. By virtue of a grant from the government.

 Binalay vs. CA – In this case, it was found by the SC that the accretion that was disputed is actual an old river bed,
and hence, property of public dominion. It cannot be acquired by the contending parties. Further, the alleged
accretion was not really one. “A sudden and forceful action like that of flooding is hardly the alluvial process
contemplated under Art. 457 of the Civil Code. It is the slow and hardly perceptible accumulation of soil deposits
that the law grants to the riparian owner.”

 Santos vs. Bernabe – The number of Kilos in a cavan not having been determined, we will take the properiton only
the 924 cavans of palay which were attached and sold, thereby giving Santos, who deposited 778 cavans, 398.49
thereof, and Tiongson, who deposited 1,026 cavans, 525.57, or the value thereof at the rate of P3/cavan. “Art. 381
of the NCC: If by the will of their owners, two things of identical or dissimilar nature are mixed, or if the mixture
occurs accidentally, if in the latter without injury, each owner shall acquire a right in the mixture proportionate to
the part belonging to him, according to the value of the things mixed or commingled.”

Quieting of Title

 Heirs of Olviga vs. CA – With regard to the issue of prescription, the SC has ruled that an action for reconveyance
of a parcel of land based in implied or constructive trust prescribes in ten years, the point of reference being the
date of registration of the deed or the date of the issuance of the certificate of title over the property. But this rule
applies, only when the plaintiff is NOT in possession of the property, the right to seek reconveyane which is in effect
seeks to quiet title to the property DOES NOT PRESCRIBE.

 Pingol vs. CA – In this case, the contract of sale was upheld, declaring that it was not a contract to sell. Now, an
action for specific performance was instituted. What is its effect? Although the private respondent’s complaint
before the trial court was denominated as one for specific performance, it is in effect an action to quiet title.
Reason? The real and ultimate basis of petitioner’s action is their ownership of the property, which entitles them
to a conveyance of the property and therefore, it is to remove the cloud upon the real owner’s ownership. * It is
not necessary that the vendee has an absolute title, an equitable title being sufficient to clothe him with personality
to bring an action to quiet title.

 Titong vs. CA – In this case, there was physical intrusion in the property of another, then he filed for an action to
quiet title. Will it prosper? No.”The ground for the filing a complaint for quieting title must therefore be an
instrument, record, claim, encumbrance, or proceeding.” The alleged may be considered ground for an action for
forcible entry but definitely not one for quieting of title. * The trial cour cannot in an action for quieting of title,
order the determination of the boundaries of the claimed property. Such determination of boundaries is
appropriate in adversarial proceedings.

 Portic vs. Cristobal – Can a party in a contract to sell, wherein the full price has not yet been paid, file an action to
quiet title on the said property? No. Generally the registered owner of a property is the proper party to bring an
action to quiet title. However, it has been held that this remedy may also be availed of by a person other than the
owner because, “title” does not necessarily refer to the original or transfer of certificate. Hence, even if there was
a transfer of certificate of title issued. Hence, even if there was a transfer of certificate title issued, there was no
transfer of ownership and further, mere registration is not enough to acquire a new title, good faith must concur.
* Suits to quiet title are characterized or proceeding quasi in rem. technically, there are neither in rem nor in
personam. In an action quasi in rem, an individual is named as defendant. However unlike suits in rem, a quasi in
rem judgment is conclusive between the parties.
Possession

 Ramos vs. Dir. Of Land – What is actual possession? It consists in the manifestation of acts of dominion over it of
such a nature as a party would naturally exercise over his own property. In this case, the land was granted to the
petitioner although he has cultivated only ¼ of the land under the principle of constructive possession. The general
rule is that the possession and cultivation of a portion of a tract under claim of ownership of all is a constructive
possession of all, IF! THE REMAINDER IS NOT UN THE ADVERSE POSESSION OF ANOTHER.

 Dir. Of Land vs. CA – The rule on constructive does not apply to this case because the major portion of the disputed
128ha has been in the adverse possession of the homesteaders and her heirs and still part of the public domain
until the patents are issued.

 Pleasantville – Is a lot buyer who constructs improvements on the wrong property erroneously delivered by the
owner’s agent, a builder in good faith? What is good faith? Good faith consists in the belief of the builder that the
land he is building on is his, and his ignorant of any defect or flaw in his title. And as good faith is presumed,
petitioner has the burden of proving bad faith on the part of Kee. At the time he built improvements on Lot 8, Kee
believed that said lot was what he bought.

 Kasilag vs. Rodriguez – Difficult question of law can be a basis of good faith.

 Banco Español- Filipino – The symbolical transfer of the goods by means of the delivery of the keys to the warehouse
where the goods were stored being sufficient to show that the depository appointed by the common consent of
the parties was legally placed in possession of the goods. The question is this case is whether or not there is a valid
contract of pledge although the depositary kept in possession of the warehouse although there was common
consent when the keys were given.

 Cuaycong vs. Benedicto – Whether or not a road can be acquired by prescription by mere toleration? When the
owners permit their neighbors to traverse the road, it was not his intention, in so doing, to divest himself of the
ownership of the land or to establish an easement thereto. Possession under the Civil Code to constitute the
foundation of a prescription must be based under a claim of title or in the concept of owner/adverse.

 Yu vs. Honrado – What is the remedy of an innocent purchaser in the instance he is deprived of his property bought
in good faith? “The buyer in good faith is entitled to be respected and protected in his possession, as if he were the
true owner thereof, until a competent court rules otherwise.” Art. 105 of RPC even provides that the restitution of
the thing itself must be made whenever possible “even though it be found in the possession of a third person who
has acquired it by lawful means, saving to the latter his action against the proper person who may be liable to him.”
However, there is no restitution in case “the thing has been acquired by the third person in the manner and under
the requirements which by law, bar an action for its recovery.”
 Cordero vs. Cabral – When does good faith cease? The defendants by their own admission, are in possession of the
disputed land. There is no evidence that they were possessors in bad faith. However, their good faith ceased when
they were served with SUMMONS to answer the complaint. As possessors in bad faith from the SERVICE OF
SUMMONS they shall reimburse the fruits received and those which legitimate possessor could have received.

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