CONRADO P. NAVARRO, plaintiff-appellee, vs. RUFINO G.

PINEDA, RAMONA
REYES, ET A., !efen!ants-appellants.
G.R. N". -#$%&' N"ve()e* +,, #-'+
FACTS.
Defendants Rufino G. Pineda and his mother Juana Gonzales, borrowed from plaintiff
Conrado P. Navarro, the sum of P2,5., pa!able after " months. #o se$ure the indebtedness,
Rufino e%e$uted a do$ument $aptioned &D''D () R'*+ ',#*#' and C-*##'+
.(R#G*G',&, whereb! Juana Gonzales, b! wa! of Real Estate Mortgage h!pothe$ated a
par$el of land, belon/in/ to her, and Rufino G. Pineda, by way of Chattel Mortgage, mort/a/ed
his two0stor! residential house, ere$ted on a lot belon/in/ to *tt!. 1i$ente Castro and one motor
tru$2, re/istered in his name.
3hen the mort/a/e debt be$ame due and pa!able, the defendants, after demands made
on them, failed to pa! and even after two e%tensions as to the period when pa!ments be$ame
due. 4n due $ourse, the plaintiff filed a $omplaint for fore$losure of the mort/a/e and for
dama/es. 3hile the $ase is bein/ heard, the parties submitted a ,tipulation of )a$ts, wherein the
defendants admitted the indebtedness, the authenti$it! and due e%e$ution of the Real 'state and
Chattel .ort/a/es and leavin/ the onl! issue in the $ase as whether or not the residential house,
sub5e$t of the mort/a/e $an be $onsidered a Chattel.
Despite su$h stipulation of fa$ts, the lower $ourt later on ruled and ordered defendants to
pa! the amount owin/ plus 627 $ompounded interest per annum to Navarro 89: da!s from
re$eipt of the (rder whi$h further ordered defendant to deliver immediatel! to the Provin$ial
,heriff of #arla$ the personal properties used as se$urit!.
ISSUE/S.
3hether or not the residential house, sub5e$t of the mort/a/e $an be $onsidered a $hattel and still
remain valid
RUING/RATIO.
;es, this Court a/rees with the trial $ourt in de$larin/ the deed of $hattel mort/a/e valid
solel! on the /round that the house mort/a/ed was ere$ted on the land whi$h belon/ed to a third
person, but also and prin$ipall! on the do$trine of estoppel, in that &the parties have so e%pressl!
a/reed& in the mort/a/e to $onsider the house as $hattel &for its smallness and mi%ed materials of
sawali and wood<.
4t is undeniable that the parties to a $ontra$t ma! b! a/reement treat as personal propert!
that whi$h b! nature would be real propert!. #here $annot be an! =uestion that a buildin/ of
mi%ed materials ma! be the sub5e$t of a $hattel mort/a/e, in whi$h $ase, it is $onsidered as
between the parties as personal propert!. #he matter depends on the $ir$umstan$es and the
intention of the parties. 4t should be noted, thou/h, that the view that parties to a deed of $hattel
mort/a/ee ma! a/ree to $onsider a house as personal propert! for the purposes of said $ontra$t,
is /ood onl! insofar as the $ontra$tin/ parties are $on$erned.
-en$e, if a house belon/in/ to a person stands on a rented land belon/in/ to another
person, it ma! be mort/a/ed as a personal propert! is so stipulated in the do$ument of mort/a/e.
4t should be noted, however, that the prin$iple is predi$ated on statements b! the owner de$larin/
his house to be a $hattel, a $ondu$t that ma! $on$eivabl! estop him from subse=uentl! $laimin/
otherwise. #he do$trine, therefore, /athered from these $ases is that althou/h in some instan$es,
a house of mi%ed materials has been $onsidered as a $hattel between them, has been re$o/nized,
it has been a $onstant $riterion nevertheless that, with respe$t to third persons, who are not
parties to the $ontra$t, and spe$iall! in e%e$ution pro$eedin/s, the house is $onsidered as an
immovable propert! 8*rt. 6>?6, New Civil Code:.
STANDARD OIL CO. vs. JARAMILLO
Facts:
On November 27, 1922, Gervasia de la Rosa, Vda. de Vera, was the lessee of a parcel of land situated in
the it! of "anila and owner of the house of stron# materials built thereon, upon which date she e$ecuted
a document in the form of a chattel mort#a#e to conve! to the %tandard Oil. o. b! wa! of mort#a#e both
the leasehold interest in said lot and the buildin# to which it stands
&fter said document had been dul! ac'nowled#ed and delivered, it was then presented to (oa)uin
(aramillo, Re#ister of *eeds of the it! of "anila, for the purpose of havin# the same recorded. +pon
e$amination of the instrument, the (aramillo was of the opinion that it was not chattel mort#a#e, for the
reason that the interest therein mort#a#ed did not appear to be personal propert!, within the meanin# of
the hattel "ort#a#e ,aw, and re#istration was refused on this #round onl!.
Issue:
-hether or not the deed ma! be re#istered in the chattel mort#a#e re#istr!.
Held:
/es it ma! be re#istered. 0he duties of a re#ister of deeds in respect to the re#istration of chattel
mort#a#es are purel! of a ministerial character, and he is clothed with no 1udicial or )uasi21udicial power to
determine the nature of the propert!, whether real or personal, which is the sub1ect of the mort#a#e.
Generall! spea'in#, he should accept the )ualification of the propert! adapted b! the person who
presents the instrument for re#istration and should place the instrument on record, upon pa!ment of the
proper fee, leavin# the effects of re#istration to be determined b! the court if such )uestion should arise
for le#al determination.
0he efficac! of the act of recordin# a chattel mort#a#e consists in the fact that re#istration operates as
constructive notice of the e$istence of the contract, and the le#al effects of the instrument must be
discovered in the document itself, in relation with the fact of notice. Re#istration adds nothin# to the
instrument, considered as a source of title, and affects nobod!3s ri#hts e$cept as a species of constructive
notice.
Bicerra v. Teneza
456RR& v 06N67& G.R. No. ,218219 November 29, 1982
:acts; appellants were the owners of the house, worth <2==.==, built on and owned b! them and situated
in the said municipalit! ,a#an#ilan#> that sometime in (anuar! 19?7 appealed forcibl! demolished the
house, claimin# to be the owners thereof> that the materials of the house, after it was dismantled, were
placed in the custod! of the barrio lieutenant of the place> and that as a result of appellate3s refusal to
restore the house or to deliver the material appellants the latter have suffered dama#es.
5ssue; whether the action involves title to real propert!.
Rulin#@ Rationale; & house is classified as immovable propert! b! reason of its adherence to the soil on
which it is built A&rt. B1?, par. 1, ivil odeC. 0his classification holds true re#ardless of the fact that the
house ma! be situated on land belon#in# to a different owner. 4ut once the house is demolished, as in
this case, it ceases to e$ist as such and hence its character as an immovable li'ewise ceases.
Bicerra v. Teneza !.R. N". L#$%&$'. N"ve()er &*+
$*%&.,
4icerra v. 0eneDa
EG.R. No. ,218219. November 29, 1982.F
6n 4anc, "a'alintal A(C; 1= concur.
:&0%; 0he 4icerras are supposedl! the owners of the house worth <2==, built on a lot owned b! them
in ,a#an#ilan#, &bra> which the 0eneDas forcibl! demolished in (anuar! 19?7, claimin# to be the owners
thereof. 0he materials of the house were placed in the custod! of the barrio lieutenant. 0he 4icerras filed
a complaint claimin# actual dama#es of <2==, moral and conse)uential dama#es amountin# to <8==,
and the costs. 0he :5 &bra dismissed the complaint claimin# that the action was within the e$clusive
Aori#inalC 1urisdiction of the (ustice of the <eace ourt of ,a#an#ilan#, &bra.
5%%+6;
-@N the action involves title to real propet!.
-@N the dismissal of the complaint was proper.
G6,*;
0he %upreme ourt affirmed the order appealed. Gavin# been admitted in forma pauperis, no costs were
ad1ud#ed.
1. Gouse is immovable propert! even if situated on land belon#in# to a different owner> 6$ception, when
demolished
& house is classified as immovable propert! b! reason of its adherence to the soil on which it is built
A&rticle B1?, para#raph 1, ivil odeC. 0his classification holds true re#ardless of the fact that the house
ma! be situated on land belon#in# to a different owner. 4ut once the house is demolished, as in this case,
it ceases to e$ist as such and hence its character as an immovable li'ewise ceases.
2. Recover! of dama#es not e$ceedin# <2,=== and involvin# no real propert! belon# to the (ustice of the
<eace ourt
0he complaint is for recover! of dama#es, the onl! positive relief pra!ed for. :urther, a declaration of
bein# the owners of the dismantled house and@or of the materials in no wise constitutes the relief itself
which if #ranted b! final 1ud#ment could be enforceable b! e$ecution, but is onl! incidental to the real
cause of action to recover dama#es. &s this is a case for recover! of dama#es where the demand does
not e$ceed <h< 2,=== and that there is no real propert! liti#ated as the house has ceased to e$ist, the
case is within the 1urisdiction of the (ustice of the <eace ourt Aas per %ection 99, R& 298 as amendedC
and not the :5 A%ection BB, id.C
B"ard "- Asses(ent A..eals v. Manila /lectric C".
4oard of &ssesment &ppeals vs "anila 6lectric o.
:acts;
5n 19=2, <hilippine ommission enacted &ct No. B9B which authoriDed the "unicipal 4oard of "anila to
#rant a franchise to construct, maintain and operate an electric street railwa! and electric li#ht, heat and
power s!stem in the it! of "anila and its suburbs to the person or persons ma'in# the most favorable
bid. harles ". %wift was awarded the said franchise, the terms and conditions of which were embodied
in Ordinance No. BB in 19=H.
5n 19??, petitioner it! &ssessor of IueDon it! declared the aforesaid steel towers for real propert! ta$
under 0a$ declaration Nos. H1992 and 1??B9. &fter den!in# respondent3s petition to cancel these
declarations, an appeal was ta'en b! respondent to the 4oard of &ssessment &ppeals of IueDon it!,
which re)uired respondent to pa! the amount of <11,8?1.98 as real propert! ta$ on the said steel towers
for the !ears 19?2 to 19?8. Respondent paid the amount under protest, and filed a petition for review in
the 0& which rendered a decision on *ecember 29, 19?9, orderin# the cancellation of the said ta$
declarations and the petitioner it! 0reasurer of IueDon it! to refund to the respondent the sum of
<11,8?1.98. 0he motion for reconsideration havin# been denied, on &pril 22, 19?9, the instant petition for
review was filed.
5ssue;
-hether the aforesaid steel towers is a real propert!, ma'in# petitioners liable for real propert! ta$.
Rulin#;
5n upholdin# the cause of respondents, the 0& held that; A1C the steel towers come within the term
JpolesJ which are declared e$empt from ta$es under part 55 para#raph 9 of respondent3s franchise> A2C the
steel towers are personal properties and are not sub1ect to real propert! ta$> and AHC the it! 0reasurer of
IueDon it! is held responsible for the refund of the amount paid. 0hese are assi#ned as errors b! the
petitioner in the brief.
6ven if steel supports or towers in )uestion are not embraced within the term poles, the lo#ical )uestion
posted is whether the! constitute real properties, so that the! can be sub1ect to a real propert! ta$. 0he
ta$ law does not provide for a definition of real propert! neither does it fall in an! of the definitions of real
propert! in &rt. B1? of the ivil ode.
Board of Assessment Appeals v.
MERALCO [G.R. No. L-15334.
an!ar" 31# 1$%4.&
!n 28
En Ban'# (aredes )*+ , 'on'!r# 1 'on'!r -n res!lt# 1 too. no part.

Facts: On /0 O'to1er 1$0/# t2e (2-l-pp-ne Comm-ss-on ena'ted A't 4,4 32-'2 a!t2or-4ed
t2e M!n-'-pal Board of Man-la to 5rant a fran'2-se to 'onstr!'t# ma-nta-n and operate an
ele'tr-' street ra-l3a" and ele'tr-' l-52t# 2eat and po3er s"stem -n t2e C-t" of Man-la and -ts
s!1!r1s to t2e person or persons ma.-n5 t2e most favora1le 1-d. C2arles M. 63-ft 3as
a3arded t2e sa-d fran'2-se on Mar'2 1$03# t2e terms and 'ond-t-ons of 32-'2 3ere
em1od-ed -n Ord-nan'e 44 approved on /4 Mar'2 1$03. Meral'o 1e'ame t2e transferee and
o3ner of t2e fran'2-se. Meral'o7s ele'tr-' po3er -s 5enerated 1" -ts 2"dro-ele'tr-' plant
lo'ated at Boto'an 8alls# La5!na and -s transm-tted to t2e C-t" of Man-la 1" means of ele'tr-'
transm-ss-on 3-res# r!nn-n5 from t2e prov-n'e of La5!na to t2e sa-d C-t". 92ese ele'tr-'
transm-ss-on 3-res 32-'2 'arr" 2-52 volta5e '!rrent# are fastened to -ns!lators atta'2ed on
steel to3ers 'onstr!'ted 1" respondent at -ntervals# from -ts 2"droele'tr-' plant -n t2e
prov-n'e of La5!na to t2e C-t" of Man-la. Meral'o 2as 'onstr!'ted 40 of t2ese steel to3ers
3-t2-n :!e4on C-t"# on land 1elon5-n5 to -t.
On 15 Novem1er 1$55# C-t" Assessor of :!e4on C-t" de'lared t2e aforesa-d steel to3ers for
real propert" ta; !nder 9a; <e'larat-on 31$$/ and 1554$. After den"-n5 Meral'o7s pet-t-on
to 'an'el t2ese de'larat-ons an appeal 3as ta.en 1" Meral'o to t2e Board of Assessment
Appeals of :!e4on C-t"# 32-'2 re=!-red Meral'o to pa" t2e amo!nt of (11#%51.,% as real
propert" ta; on t2e sa-d steel to3ers for t2e "ears 1$5/ to 1$5%. Meral'o pa-d t2e amo!nt
!nder protest# and >led a pet-t-on for rev-e3 -n t2e Co!rt of 9a; Appeals 32-'2 rendered a
de'-s-on on /$ <e'em1er 1$5,# order-n5 t2e 'an'ellat-on of t2e sa-d ta; de'larat-ons and
t2e C-t" 9reas!rer of :!e4on C-t" to ref!nd to Meral'o t2e s!m of (11#%51.,%. 92e mot-on for
re'ons-derat-on 2av-n5 1een den-ed# on // Apr-l 1$5$# t2e pet-t-on for rev-e3 3as >led.
?ss!e+ @2et2er or not t2e steel to3ers of an ele'tr-' 'ompan" 'onst-t!te real propert" for t2e
p!rposes of real propert" ta;.
Aeld+ 92e steel to3ers of an ele'tr-' 'ompan" don7t 'onst-t!te real propert" for t2e p!rposes
of real propert" ta;.
Steel towers are not immovable property under paragraph 1, 3 and 5 of rticle
!15"
92e steel to3ers or s!pports do not 'ome 3-t2-n t2e o1Be'ts ment-oned -n para5rap2 1#
1e'a!se t2e" do not 'onst-t!te 1!-ld-n5s or 'onstr!'t-ons ad2ered to t2e so-l. 92e" are not
'onstr!'t-ons analo5o!s to 1!-ld-n5s nor ad2er-n5 to t2e so-l. As per des'r-pt-on# 5-ven 1"
t2e lo3er 'o!rt# t2e" are remova1le and merel" atta'2ed to a s=!are metal frame 1" means
of 1olts# 32-'2 32en !ns're3ed 'o!ld eas-l" 1e d-smantled and moved from pla'e to pla'e.
92e" 'annot 1e -n'l!ded !nder para5rap2 3# as t2e" are not atta'2ed to an -mmova1le -n a
>;ed manner# and t2e" 'an 1e separated 3-t2o!t 1rea.-n5 t2e mater-al or 'a!s-n5
deter-orat-on !pon t2e o1Be't to 32-'2 t2e" are atta'2ed. Ea'2 of t2ese steel to3ers or
s!pports 'ons-sts of steel 1ars or metal str-ps# Bo-ned to5et2er 1" means of 1olts# 32-'2 'an
1e d-sassem1led 1" !ns're3-n5 t2e 1olts and reassem1led 1" s're3-n5 t2e same.
92ese steel to3ers or s!pports do not also fall !nder para5rap2 5# for t2e" are not
ma'2-ner-es or re'epta'les# -nstr!ments or -mplements# and even -f t2e" 3ere# t2e" are not
-ntended for -nd!str" or 3or.s on t2e land.
(et-t-oner -s not en5a5ed -n an -nd!str" or 3or.s on t2e land -n 32-'2 t2e steel s!pports or
to3ers are 'onstr!'ted.
92e 6!preme Co!rt aCrmed t2e de'-s-on appealed from# 3-t2 'osts a5a-nst t2e pet-t-oners.
SIBAL v. 0ALD/1
!.R. N". L#&%&2' Au3ust 4+ $*&2
J"5ns"n+ J.
D"ctrine;
K A crop raised on leased premises belongs to the lessee and in no sense forms part of the immovable.
K Ungathered products have the nature of personal property. In other words, the phrase personal property should
be understood to include ungathered products. Crops, whether growing or standing in the field ready to be
harvested, are, when produced by annual cultivation, no part of the realty.
K A valid sale may be made of a thing, which though not yet actually in existence, is reasonably certain to come into
existence. A man may sell property of which he is potentially and not actually possessed.
Facts;
<laintiff alle#ed that the defendant Vitaliano "amawal, deput! sheriff of the <rovince of 0arlac, b! virtue of a writ of
e$ecution issued b! the ourt of :irst 5nstance of <ampan#a, attached and sold to the defendant 6miliano (. ValdeD
the su#ar cane planted b! the plaintiff and his tenants on seven parcels of land. <laintiff offered to redeem said su#ar
cane and tendered to the defendant ValdeD the amount sufficient to cover the price paid b! the latter, the interest
thereon and an! assessments or ta$es which he ma! have paid thereon after the purchase, and the interest
correspondin# thereto. Gowever, ValdeD refused to accept the mone! and to return the su#ar cane to the plaintiff.
"eanwhile, defendant ar#ued that the su#ar cane was personal propert! hence not sub1ect to redemption.
Issue;
1. -hether or not the su#ar cane is to be classified as personal propert!
2. -hether or not future crops to be harvested can be considered a valid ob1ect of sale
Held;
1. No. & crop raised on leased premises in no sense forms part of the immovable. 5t belon#s to the lessee, and ma!
be sold b! him, whether it be #athered or not, and it ma! be sold b! his 1ud#ment creditors.
LUngathered productsM have the nature of personal propert!. 5n other words, the phrase Lpersonal propertyM should be
understood to include Lungathered products.M rops, whether #rowin# or standin# in the field read! to be harvested,
are, when produced b! annual cultivation, no part of the realt!.
2. /es. & valid sale ma! be made of a thin#, which thou#h not !et actuall! in e$istence, is reasonabl! certain to come
into e$istence as the natural increment or usual incident of somethin# alread! in e$istence, and then belon#in# to the
vendor, and then title will vest in the bu!er the moment the thin# comes into e$istence Amerson vs. uropean
!ailway Co., "# $e., %&#' Cutting vs. (ac)ers xchange, *+ Am. ,t. !ep., "%.C.
& man ma! sell propert! of which he is potentiall! and not actuall! possessed.
Tsai vs. C"urt "- A..eals
#uby $sai vs" %ourt of ppeals, &ver $e'tile (ills, )nc" and (amerto *illalu+
,"#" -o" 12.1./, 0ctober 2, 2..1
Quisumbing, J.
1octrine+ Not2-n5 detra'ts t2e part-es from treat-n5 -t [t2e propert" t2at -s -mmova1le
1" nat!re as '2attels to se'!re an o1l-5at-on !nder t2e pr-n'-ple of estoppel.
Facts: On Novem1er /%# 1$D5# respondent Ever 9e;t-le M-lls# ?n'. )EEER9EF* o1ta-ned a
(3#000#000.00 loan from (2-l-pp-ne Ban. of Comm!n-'at-ons )(BCom*. As se'!r-t" for
t2e loan# EEER9EF e;e'!ted -n favor of (BCom# a deed of Real and C2attel Mort5a5e
over t2e lot 32ere -ts fa'tor" stands and t2e '2attels lo'ated t2ere-n as en!merated -n
a s'2ed!le atta'2ed to t2e mort5a5e 'ontra't. (BCom 5ranted a se'ond loan of
(3#35%#000.00 to EEER9EF. 92e loan 3as se'!red 1" a C2attel Mort5a5e over personal
propert-es en!merated -n a l-st atta'2ed t2ereto 32-'2 3ere s-m-lar to t2ose l-sted -n
Anne; A of t2e >rst mort5a5e deed.
After Apr-l /3# 1$D$# t2e date of t2e e;e'!t-on of t2e se'ond mort5a5e# EEER9EF
p!r'2ased var-o!s ma'2-nes and e=!-pments. 92en# d!e to 1!s-ness reverses# EEER9EF
>led -nsolven'" pro'eed-n5s. 92e C8? -ss!ed an order de'lar-n5 t2e 'orporat-on
-nsolvent. All -ts assets 3ere ta.en -nto t2e '!stod" of t2e ?nsolven'" Co!rt. ?n t2e
meant-me# !pon EEER9EF7s fa-l!re to meet -ts o1l-5at-on to (BCom# t2e latter
'ommen'ed e;traB!d-'-al fore'los!re pro'eed-n5s a5a-nst EEER9EF. On <e'em1er 15#
1$,/# t2e >rst p!1l-' a!'t-on 3as 2eld 32ere pet-t-oner (BCom emer5ed as t2e 2-52est.
On <e'em1er /3# 1$,/# anot2er p!1l-' a!'t-on 3as 2eld and a5a-n# (BCom 3as t2e
2-52est 1-dder. (BCom t2en leased t2e ent-re fa'tor" prem-ses to pet-t-oner R!1" L. 9sa-
for (50#000.00 a mont2 and s!1se=!entl" sold t2e fa'tor"# lo'.# sto'. and 1arrel to 9sa-
for ($#000#000.00# -n'l!d-n5 t2e 'ontested ma'2-ner-es.
On Mar'2 1%# 1$,$# EEER9EF >led a 'ompla-nt for ann!lment of sale# re'onve"an'e#
and dama5es 3-t2 t2e Re5-onal 9r-al Co!rt a5a-nst (BCom# alle5-n5 t2at t2e e;traB!d-'-al
fore'los!re of s!1Be't mort5a5e 3as -n v-olat-on of t2e ?nsolven'" La3. 8!rt2er#
EEER9EF averred t2at (BCom# 3-t2o!t an" le5al or fa't!al 1as-s# appropr-ated t2e
'ontested propert-es# 32-'2 3ere not -n'l!ded -n t2e Real and C2attel Mort5a5e nor -n
t2e C2attel Mort5a5e and ne-t2er 3ere t2ose propert-es -n'l!ded -n t2e Not-'e of
62er-G7s. 92e d-sp!ted propert-es# 32-'2 3ere val!ed at (4#000#000.00# are+ 14 ?nterlo'.
C-r'!lar Hn-tt-n5 Ma'2-nes# 1 et <r"-n5 E=!-pment# 1 <r"er E=!-pment# 1 Ra-s-n
E=!-pment and 1 Aeatset E=!-pment.
92e tr-al 'o!rt rendered -n favor of EEER9EF. (BCom and 9sa- appealed to t2e Co!rt of
Appeals 32-'2 aCrmed R9C7s de'-s-on. 92e-r Mot-on for re'ons-derat-on 3as also den-ed.
92!s# (BCom and 9sa- >led t2e-r separate pet-t-ons for rev-e3 3-t2 t2-s Co!rt.
)ssue: @2et2er t2e nat!re of t2e d-sp!ted ma'2-ner-es ma.e t2em -mmova1le !nder
Art-'le 415 )3* and )5* of t2e C-v-l Code.
2eld: No. (et-t-oners 'ontend t2at t2e nat!re of t2e d-sp!ted ma'2-ner-es# -.e.# t2at
t2e" 3ere 2eav"# 1olted or 'emented on t2e real propert" mort5a5ed 1" EEER9EF to
(BCom# ma.e t2em -pso fa'to -mmova1le !nder Art-'le 415 )3* and )5* of t2e Ne3 C-v-l
Code. 92-s assert-on# 2o3ever# does not settle t2e -ss!e. Mere n!ts and 1olts do not
fore'lose t2e 'ontrovers". @e 2ave to loo. at t2e part-es7 -ntent.
@2-le -t -s tr!e t2at t2e 'ontroverted propert-es appear to 1e -mmo1-le# a per!sal of t2e
'ontra't of Real and C2attel Mort5a5e e;e'!ted 1" t2e part-es 2ere-n 5-ves !s a
'ontrar" -nd-'at-on. ?n t2e 'ase at 1ar# 1ot2 t2e tr-al and t2e appellate 'o!rts rea'2ed
t2e same >nd-n5 t2at t2e tr!e -ntent-on of (BCOM and t2e o3ner# EEER9EF# -s to treat
ma'2-ner" and e=!-pment as '2attels. 92e pert-nent port-on of respondent appellate
'o!rt7s r!l-n5 -s =!oted 1elo3+
?t s2o!ld 1e noted t2at t2e pr-nted form !sed 1" appellant 1an. 3as ma-nl" for real
estate mort5a5es. B!t reIe't-ve of t2e tr!e -ntent-on of appellant (BCOM and appellee
EEER9EF 3as t2e t"p-n5 -n 'ap-tal letters# -mmed-atel" follo3-n5 t2e pr-nted 'apt-on of
mort5a5e# of t2e p2rase Jreal and '2attel.K 6o also# t2e Jma'2-ner-es and e=!-pmentK -n
t2e pr-nted form of t2e 1an. 2ad to 1e -nserted -n t2e 1lan. spa'e of t2e pr-nted
'ontra't and 'onne'ted 3-t2 t2e 3ord J1!-ld-n5K 1" t"pe3r-tten slas2 mar.s. No3# t2en#
-f t2e ma'2-ner-es -n =!est-on 3ere 'ontemplated to 1e -n'l!ded -n t2e real estate
mort5a5e# t2ere 3o!ld 2ave 1een no ne'ess-t" to -n. a '2attel mort5a5e spe'->'all"
ment-on-n5 as part ??? of 6'2ed!le A a l-st-n5 of t2e ma'2-ner-es 'overed t2ere1". ?t
3o!ld 2ave s!C'ed to l-st t2em as -mmova1les -n t2e <eed of Real Estate Mort5a5e of
t2e land and 1!-ld-n5 -nvolved.
9oo# ass!m-n5 ar5!endo t2at t2e propert-es -n =!est-on are -mmova1le 1" nat!re#
not2-n5 detra'ts t2e part-es from treat-n5 -t as '2attels to se'!re an o1l-5at-on !nder
t2e pr-n'-ple of estoppel. As far 1a'. as Navarro v. (-neda# $ 6CRA %31 )1$%3*# an
-mmova1le ma" 1e 'ons-dered a personal propert" -f t2ere -s a st-p!lat-on as 32en -t -s
!sed as se'!r-t" -n t2e pa"ment of an o1l-5at-on 32ere a '2attel mort5a5e -s e;e'!ted
over -t# as -n t2e 'ase at 1ar.
?n t2e -nstant 'ase# t2e part-es 2ere-n+ )1* e;e'!ted a 'ontra't st"led as JReal Estate
Mort5a5e and C2attel Mort5a5e#K -nstead of B!st JReal Estate Mort5a5eK -f -ndeed t2e-r
-ntent-on -s to treat all propert-es -n'l!ded t2ere-n as -mmova1le# and )/* atta'2ed to
t2e sa-d 'ontra't a separate JL?69 O8 MACA?NER?E6 L E:M?(MEN9K. 92ese fa'ts# ta.en
to5et2er# ev-n'e t2e 'on'l!s-on t2at t2e part-es7 -ntent-on -s to treat t2ese !n-ts of
ma'2-ner" as '2attels. A fort-or-# t2e 'ontested after-a'=!-red propert-es# 32-'2 are of
t2e same des'r-pt-on as t2e !n-ts en!merated !nder t2e t-tle JL?69 O8 MACA?NER?E6 L
E:M?(MEN9#K m!st also 1e treated as '2attels. And# s-n'e t2e d-sp!ted ma'2-ner-es
3ere a'=!-red -n 1$,1 and 'o!ld not 2ave 1een -nvolved -n t2e 1$D5 or 1$D$ '2attel
mort5a5es# -t 3as 'onse=!entl" an error on t2e part of t2e 62er-G to -n'l!de s!1Be't
ma'2-ner-es 3-t2 t2e propert-es en!merated -n sa-d '2attel mort5a5es.
Dava" Sa6(ill v. Castill"
*&V&O %&- "5,, vs. &<RON5&NO G. &%05,,O and *&V&O ,5GG0 N <O-6R O., 5N. G.R. No. ,2
B=B11 &u#ust 7, 19H?
:acts;
*avao %aw "ill o., 5nc., is the holder of a lumber concession from the Government of the <hilippine
5slands. Gowever, the land upon which the business was conducted belon#ed to another person. On the
land the sawmill compan! erected a buildin# which housed the machiner! used b! it. %ome of the
implements thus used were clearl! personal propert!, the conflict concernin# machines which were
placed and mounted on foundations of cement. 5n the contract of lease between the sawmill compan! and
the owner of the land there appeared the followin# provision; 0hat on the e$piration of the period a#reed
upon, all the improvements and buildin#s introduced and erected b! the part! of the second part shall
pass to the e$clusive ownership of the lessor without an! obli#ation on its part to pa! an! amount for said
improvements and buildin#s> which do not include the machineries and accessories in the improvements.
5n another action wherein the *avao ,i#ht N <ower o., 5nc., was the plaintiff and the *avao, %aw, "ill
o., 5nc., was the defendant, a 1ud#ment was rendered in favor of the plaintiff in that action a#ainst the
defendant> a writ of e$ecution issued thereon, and the properties now in )uestion were levied upon as
personalt! b! the sheriff. No third part! claim was filed for such properties at the time of the sales thereof
as is borne out b! the record made b! the plaintiff herein
5t must be noted also that on number of occasion, *avao %awmill treated the machiner! as personal
propert! b! e$ecutin# chattel mort#a#es in favor of third persons. One of such is the appellee b!
assi#nment from the ori#inal mort#a#es.
0he lower court rendered decision in favor of the defendants herein. Gence, this instant appeal.
5ssue;
whether or not the machineries and e)uipments were personal in nature.
Rulin#@ Rationale;
/es. 0he %upreme ourt affirmed the decision of the lower court.
"achiner! which is movable in its nature onl! becomes immobiliDed when placed in a plant b! the owner
of the propert! or plant, but not when so placed b! a tenant, a usufructuar!, or an! person havin# onl! a
temporar! ri#ht, unless such person acted as the a#ent of the owner.
Mindanao Bus Co. v. City Assessor Digest
G.R. No. L-17870 29 September 1962
:acts; <etitioner is a public utilit! compan! en#a#ed in the transport of passen#ers and car#o b!
motor vehicles in "indanao with main offices in a#a!an de Oro A*OC. <etitioner li'ewise owned a
land where it maintains a #ara#e, a repair shop and blac'smith or carpentr! shops. 0he machineries
are placed thereon in wooden and cement platforms. 0he it! &ssessor of *O then assessed a
<B,B== realt! ta$ on said machineries and repair e)uipment. <etitioner appealed to the 4oard of 0a$
&ppeals but it sustained the it! &ssessor3s decision, while the ourt of 0a$ &ppeals A0&C
sustained the same.
-ote. /his is merely a case digest to aid in remembering the important points of a case. It is still
advisable for any student of law to read the full text of assigned cases.
Issue: Whether or not the machineries and equipments are considered immobilized and thus
subject to a realty tax
Geld; 0he %upreme ourt decided otherwise and held that said machineries and e)uipments are not
sub1ect to the assessment of real estate ta$.
%aid e)uipments are not considered immobiliDed as the! are merel! incidental, not esential and
principal to the business of the petitioner. 0he transportation business could be carried on without
repair or service shops of its rollin# e)uipment as the! can be repaired or services in another shop
belon#in# to another
)G.R. No. 13DD05 A!5!st //# /000*
S&#,3S 4#015%$S, )-%", and S&#,)0 ,065)078, petitioners, vs" 4%)
7&S)-, -1 F)--%&, )-%", respondent"
4-,-)9-, :
8a'ts+
On :ebruar! 1H, 1999, respondent <5 ,easin# and :inance, 5nc. AL<5 ,easin#M for shortC filed
with the R02I a complaint for a sum of mone!, with an application for a writ of replevin doc'eted as
ivil ase No. I2992HH?==. +pon an e$2parte application of <5 ,easin#, respondent 1ud#e issued a writ
of replevin directin# its sheriff to seiDe and deliver the machineries and e)uipment to <5 ,easin#. On
"arch 2B, 1999, in implementation of said writ, the sheriff proceeded to petitionerOs factor!, seiDed one
machiner! with the word that he would return for the other machineries.
<etitioners A%6RGOs <roducts 5nc.C filed a motion for special protective order, invo'in# the power
of the court to control the conduct of its officers and amend and control its processes, pra!in# for a
directive for the sheriff to defer enforcement of the writ of replevin. 0his motion was opposed b! <5
,easin#, on the #round that the properties were still personal and therefore still sub1ect to seiDure and a
writ of replevin. 5n their Repl!, petitioners asserted that the properties sou#ht to be seiDed EwereF
immovable as defined in &rticle B1? of the ivil ode, the partiesO a#reement to the contrar!
notwithstandin#. 0he! ar#ued that to #ive effect to the a#reement would be pre1udicial to innocent third
parties. 0he! further stated that <5 ,easin# EwasF estopped from treatin# these machineries as personal
because the contracts in which the alle#ed a#reement EwereF embodied EwereF totall! sham and farcical.
On &pril 8, 1999, the sheriff a#ain sou#ht to enforce the writ of seiDure and ta'e possession of the
remainin# properties. Ge was able to ta'e two more, but was prevented b! the wor'ers from ta'in# the
rest. On &pril 7, 1999, the! went to Ethe &F via an ori#inal action for certiorari. 0he appellate ourt held
that the sub1ect machines were personal propert!, and that the! had onl! been leased, not owned b!
petitioners. Gence, this petition.
5ssue;
-hether the said machines are personal, not immovable, propert! which ma! be a proper sub1ect of a
writ of replevin.Awhich are issued for the recover! of personal propert!C
Rulin#;
5n the present case, the machines that were the sub1ects of the -rit of %eiDure were placed b! petitioners
in the factor! built on their own land. 5ndisputabl!, the! were essential and principal elements of their
chocolate2ma'in# industr!. Gence, althou#h each of them was movable or personal propert! on its own,
all of them have become LimmobiliDed b! destination because the! are essential and principal elements in
the industr!.M 5n that sense, petitioners are correct in ar#uin# that the said machines are real, not
personal, propert! pursuant to &rticle B1? A?C of the ivil ode.
4ut the ourt disa#ree with the submission of the petitioners that the said machines are not proper
sub1ects of the -rit of %eiDure. 5t has held that contractin# parties ma! validl! stipulate that a real
propert! be considered as personal. &fter a#reein# to such stipulation, the! are conse)uentl! estopped
from claimin# otherwise. +nder the principle of estoppel, a part! to a contract is ordinaril! precluded from
den!in# the truth of an! material fact found therein. 5n the present case, the ,ease &#reement clearl!
provides that the machines in )uestion are to be considered as personal propert!. %pecificall!, %ection
12.1 of the &#reement reads as follows;
L12.1 0he <RO<6R0/ is, and shall at all times be and remain, personal propert! notwithstandin# that
the <RO<6R0/ or an! part thereof ma! now be, or hereafter become, in an! manner affi$ed or attached
to or embedded in, or permanentl! restin# upon, real propert! or an! buildin# thereon, or attached in an!
manner to what is permanent.M
learl! then, petitioners are estopped from den!in# the characteriDation of the sub1ect machines as
personal propert!. +nder the circumstances, the! are proper sub1ects of the -rit of %eiDure.
5t should be stressed, however, that the ourtOs holdin# 22 that the machines should be deemed personal
propert! pursuant to the ,ease &#reement P is #ood onl! insofar as the contractin# parties are
concerned. Gence, while the parties are bound b! the &#reement, third persons actin# in #ood faith are
not affected b! its stipulation characteriDin# the sub1ect machiner! as personal.
*O0R5N6; 7rinci.le "- /st"..el2 &fter a#reein# to a contract stipulatin# that a real or immovable
propert! be considered as personal or movable, a part! is estopped from subse)uentl! claimin#
otherwise.
Fels /ner38 vs. Batan3as
Fels &nergy, )nc" vs" 4rovince of 9atangas
,"#" -o" 1;855<" February 1;, 2..<"
Callejo Sr., J.
1octrine: ?n Consol-dated Ed-son Compan" of Ne3 Nor.# ?n'.# et al. v. 92e C-t" of Ne3
Nor.# et al.# a po3er 'ompan" 1ro!52t an a't-on to rev-e3 propert" ta; assessment. On
t2e '-t"7s mot-on to d-sm-ss# t2e 6!preme Co!rt of Ne3 Nor. 2eld t2at t2e 1ar5es on
32-'2 3ere mo!nted 5as t!r1-ne po3er plants des-5nated to 5enerate ele'tr-'al po3er#
t2e f!el o-l 1ar5es 32-'2 s!ppl-ed f!el o-l to t2e po3er plant 1ar5es# and t2e a''essor"
e=!-pment mo!nted on t2e 1ar5es 3ere s!1Be't to real propert" ta;at-on.
Moreover# Art-'le 415 )$* of t2e Ne3 C-v-l Code prov-des t2at Jdo'.s and str!'t!res
32-'2# t2o!52 Ioat-n5# are -ntended 1" t2e-r nat!re and o1Be't to rema-n at a >;ed
pla'e on a r-ver# la.e# or 'oastK are 'ons-dered -mmova1le propert". 92!s# po3er 1ar5es
are 'ate5or-4ed as -mmova1le propert" 1" dest-nat-on# 1e-n5 -n t2e nat!re of ma'2-ner"
and ot2er -mplements -ntended 1" t2e o3ner for an -nd!str" or 3or. 32-'2 ma" 1e
'arr-ed on -n a 1!-ld-n5 or on a p-e'e of land and 32-'2 tend d-re'tl" to meet t2e needs
of sa-d -nd!str" or 3or..
Facts: On an!ar" 1,# 1$$3# N(C entered -nto a lease 'ontra't 3-t2 (olar Ener5"# ?n'.
over 3O30 M@ d-esel en5-ne po3er 1ar5es moored at Bala"an Ba" -n Cala'a# Batan5as.
92e 'ontra't# denom-nated as an Ener5" Convers-on A5reement# 3as for a per-od of >ve
"ears. Art-'le 10 states t2at N(C s2all 1e respons-1le for t2e pa"ment of ta;es. )ot2er
t2an )-* ta;es -mposed or 'al'!lated on t2e 1as-s of t2e net -n'ome of (OLAR and
(ersonal ?n'ome 9a;es of -ts emplo"ees and )--* 'onstr!'t-on perm-t fees# env-ronmental
perm-t fees and ot2er s-m-lar fees and '2ar5es. (olar Ener5" t2en ass-5ned -ts r-52ts
!nder t2e A5reement to 8els desp-te N(C7s -n-t-al oppos-t-on.
8EL6 re'e-ved an assessment of real propert" ta;es on t2e po3er 1ar5es from (rov-n'-al
Assessor La!ro C. Anda"a of Batan5as C-t". 8EL6 referred t2e matter to N(C# rem-nd-n5
-t of -ts o1l-5at-on !nder t2e A5reement to pa" all real estate ta;es. ?t t2en 5ave N(C t2e
f!ll po3er and a!t2or-t" to represent -t -n an" 'onferen'e re5ard-n5 t2e real propert"
assessment of t2e (rov-n'-al Assessor. N(C >led a pet-t-on 3-t2 t2e LBAA. 92e LBAA
ordered 8els to pa" t2e real estate ta;es. 92e LBAA r!led t2at t2e po3er plant fa'-l-t-es#
32-le t2e" ma" 1e 'lass->ed as mova1le or personal propert"# are nevert2eless
'ons-dered real propert" for ta;at-on p!rposes 1e'a!se t2e" are -nstalled at a spe'->'
lo'at-on 3-t2 a '2ara'ter of permanen'". 92e LBAA also po-nted o!t t2at t2e o3ner of
t2e 1ar5esP8EL6# a pr-vate 'orporat-onP-s t2e one 1e-n5 ta;ed# not N(C. A mere
a5reement ma.-n5 N(C respons-1le for t2e pa"ment of all real estate ta;es and
assessments 3-ll not B!st-f" t2e e;empt-on of 8EL6Q s!'2 a pr-v-le5e 'an onl" 1e 5ranted
to N(C and 'annot 1e e;tended to 8EL6. 8-nall"# t2e LBAA also r!led t2at t2e pet-t-on
3as >led o!t of t-me.
8els appealed to t2e CBAA. 92e CBAA reversed and r!led t2at t2e po3er 1ar5es 1elon5
to N(CQ s-n'e t2e" are a't!all"# d-re'tl" and e;'l!s-vel" !sed 1" -t# t2e po3er 1ar5es are
'overed 1" t2e e;empt-ons !nder 6e't-on /34)'* of R.A. No. D1%0. As to t2e ot2er
B!r-sd-'t-onal -ss!e# t2e CBAA r!led t2at pres'r-pt-on d-d not pre'l!de t2e N(C from
p!rs!-n5 -ts 'la-m for ta; e;empt-on -n a''ordan'e 3-t2 6e't-on /0% of R.A. No. D1%0.
Mpon MR# t2e CBAA reversed -tself.
)ssue: @2et2er or not t2e pet-t-oner ma" 1e assessed of real propert" ta;es.
2eld: NE6. 92e CBAA and LBAA po3er 1ar5es are real propert" and are t2!s s!1Be't to
real propert" ta;. 92-s -s also t2e -nev-ta1le 'on'l!s-on# 'ons-der-n5 t2at G.R. No.
1%5113 3as d-sm-ssed for fa-l!re to s!C'-entl" s2o3 an" revers-1le error. 9a;
assessments 1" ta; e;am-ners are pres!med 'orre't and made -n 5ood fa-t2# 3-t2 t2e
ta;pa"er 2av-n5 t2e 1!rden of prov-n5 ot2er3-se. Bes-des# fa't!al >nd-n5s of
adm-n-strat-ve 1od-es# 32-'2 2ave a'=!-red e;pert-se -n t2e-r >eld# are 5enerall" 1-nd-n5
and 'on'l!s-ve !pon t2e Co!rtQ 3e 3-ll not ass!me to -nterfere 3-t2 t2e sens-1le
e;er'-se of t2e B!d5ment of men espe'-all" tra-ned -n appra-s-n5 propert". @2ere t2e
B!d-'-al m-nd -s left -n do!1t# -t -s a so!nd pol-'" to leave t2e assessment !nd-st!r1ed.
@e >nd no reason to depart from t2-s r!le -n t2-s 'ase.
?n Consol-dated Ed-son Compan" of Ne3 Nor.# ?n'.# et al. v. 92e C-t" of Ne3 Nor.# et al.# a
po3er 'ompan" 1ro!52t an a't-on to rev-e3 propert" ta; assessment. On t2e '-t"7s
mot-on to d-sm-ss# t2e 6!preme Co!rt of Ne3 Nor. 2eld t2at t2e 1ar5es on 32-'2 3ere
mo!nted 5as t!r1-ne po3er plants des-5nated to 5enerate ele'tr-'al po3er# t2e f!el o-l
1ar5es 32-'2 s!ppl-ed f!el o-l to t2e po3er plant 1ar5es# and t2e a''essor" e=!-pment
mo!nted on t2e 1ar5es 3ere s!1Be't to real propert" ta;at-on.
Moreover# Art-'le 415 )$* of t2e Ne3 C-v-l Code prov-des t2at Jdo'.s and str!'t!res
32-'2# t2o!52 Ioat-n5# are -ntended 1" t2e-r nat!re and o1Be't to rema-n at a >;ed
pla'e on a r-ver# la.e# or 'oastK are 'ons-dered -mmova1le propert". 92!s# po3er 1ar5es
are 'ate5or-4ed as -mmova1le propert" 1" dest-nat-on# 1e-n5 -n t2e nat!re of ma'2-ner"
and ot2er -mplements -ntended 1" t2e o3ner for an -nd!str" or 3or. 32-'2 ma" 1e
'arr-ed on -n a 1!-ld-n5 or on a p-e'e of land and 32-'2 tend d-re'tl" to meet t2e needs
of sa-d -nd!str" or 3or..
(et-t-oners ma-nta-n nevert2eless t2at t2e po3er 1ar5es are e;empt from real estate ta;
!nder 6e't-on /34 )'* of R.A. No. D1%0 1e'a!se t2e" are a't!all"# d-re'tl" and
e;'l!s-vel" !sed 1" pet-t-oner N(C# a 5overnment- o3ned and 'ontrolled 'orporat-on
en5a5ed -n t2e s!ppl"# 5enerat-on# and transm-ss-on of ele'tr-' po3er.
@e aCrm t2e >nd-n5s of t2e LBAA and CBAA t2at t2e o3ner of t2e ta;a1le propert-es -s
pet-t-oner 8EL6# 32-'2 -n >ne# -s t2e ent-t" 1e-n5 ta;ed 1" t2e lo'al 5overnment. As
st-p!lated !nder 6e't-on /.11# Art-'le / of t2e A5reement+
JO@NER6A?( O8 (O@ER BARGE6. (OLAR s2all o3n t2e (o3er Bar5es and all t2e
>;t!res# >tt-n5s# ma'2-ner" and e=!-pment on t2e 6-te !sed -n 'onne't-on 3-t2 t2e
(o3er Bar5es 32-'2 2ave 1een s!ppl-ed 1" -t at -ts o3n 'ost. (OLAR s2all operate#
mana5e and ma-nta-n t2e (o3er Bar5es for t2e p!rpose of 'onvert-n5 8!el of NA(OCOR
-nto ele'tr-'-t".K
?t follo3s t2en t2at 8EL6 'annot es'ape l-a1-l-t" from t2e pa"ment of realt" ta;es 1"
-nvo.-n5 -ts e;empt-on -n 6e't-on /34 )'* of R.A. No. D1%0. ?ndeed# t2e la3 states t2at
t2e ma'2-ner" m!st 1e a't!all"# d-re'tl" and e;'l!s-vel" !sed 1" t2e 5overnment
o3ned or 'ontrolled 'orporat-onQ nevert2eless# pet-t-oner 8EL6 st-ll 'annot >nd sola'e -n
t2-s prov-s-on 1e'a!se 6e't-on 5.5# Art-'le 5 of t2e A5reement prov-des+
JO(ERA9?ON. (OLAR !nderta.es t2at !nt-l t2e end of t2e Lease (er-od# s!1Be't to t2e
s!ppl" of t2e ne'essar" 8!el p!rs!ant to Art-'le % and to t2e ot2er prov-s-ons 2ereof# -t
3-ll operate t2e (o3er Bar5es to 'onvert s!'2 8!el -nto ele'tr-'-t" -n a''ordan'e 3-t2
(art A of Art-'le D.
?t -s a 1as-' r!le t2at o1l-5at-ons ar-s-n5 from a 'ontra't 2ave t2e for'e of la3 1et3een
t2e part-es. Not 1e-n5 'ontrar" to la3# morals# 5ood '!stoms# p!1l-' order or p!1l-'
pol-'"# t2e part-es to t2e 'ontra't are 1o!nd 1" -ts terms and 'ond-t-ons.
9-me and a5a-n# t2e 6!preme Co!rt 2as stated t2at ta;at-on -s t2e r!le and e;empt-on -s
t2e e;'ept-on. 92e la3 does not loo. 3-t2 favor on ta; e;empt-ons and t2e ent-t" t2at
3o!ld see. to 1e t2!s pr-v-le5ed m!st B!st-f" -t 1" 3ords too pla-n to 1e m-sta.en and
too 'ate5or-'al to 1e m-s-nterpreted. 92!s# appl"-n5 t2e r!le of str-'t 'onstr!'t-on of
la3s 5rant-n5 ta; e;empt-ons# and t2e r!le t2at do!1ts s2o!ld 1e resolved -n favor of
prov-n'-al 'orporat-ons# 3e 2old t2at 8EL6 -s 'ons-dered a ta;a1le ent-t".
92e mere !nderta.-n5 of pet-t-oner N(C !nder 6e't-on 10.1 of t2e A5reement# t2at -t
s2all 1e respons-1le for t2e pa"ment of all real estate ta;es and assessments# does not
B!st-f" t2e e;empt-on. 92e pr-v-le5e 5ranted to pet-t-oner N(C 'annot 1e e;tended to
8EL6. 92e 'ovenant -s 1et3een 8EL6 and N(C and does not 1-nd a t2-rd person not pr-v"
t2ereto# -n t2-s 'ase# t2e (rov-n'e of Batan5as.
?t m!st 1e po-nted o!t t2at t2e protra'ted and '-r'!-to!s l-t-5at-on 2as ser-o!sl" res!lted
-n t2e lo'al 5overnment7s depr-vat-on of reven!es. 92e po3er to ta; -s an -n'-dent of
sovere-5nt" and -s !nl-m-ted -n -ts ma5n-t!de# a'.no3led5-n5 -n -ts ver" nat!re no
per-meter so t2at se'!r-t" a5a-nst -ts a1!se -s to 1e fo!nd onl" -n t2e respons-1-l-t" of
t2e le5-slat!re 32-'2 -mposes t2e ta; on t2e 'onst-t!en'" 32o are to pa" for -t. 92e
r-52t of lo'al 5overnment !n-ts to 'olle't ta;es d!e m!st al3a"s 1e !p2eld to avo-d
severe ta; eros-on. 92-s 'ons-derat-on -s 'ons-stent 3-t2 t2e 6tate pol-'" to 5!arantee
t2e a!tonom" of lo'al 5overnments and t2e o1Be't-ve of t2e Lo'al Government Code
t2at t2e" enBo" 5en!-ne and mean-n5f!l lo'al a!tonom" to empo3er t2em to a'2-eve
t2e-r f!llest development as self-rel-ant 'omm!n-t-es and ma.e t2em eGe't-ve partners
-n t2e atta-nment of nat-onal 5oals.
?n 'on'l!s-on# 3e re-terate t2at t2e po3er to ta; -s t2e most potent -nstr!ment to ra-se
t2e needed reven!es to >nan'e and s!pport m"r-ad a't-v-t-es of t2e lo'al 5overnment
!n-ts for t2e del-ver" of 1as-' serv-'es essent-al to t2e promot-on of t2e 5eneral 3elfare
and t2e en2an'ement of pea'e# pro5ress# and prosper-t" of t2e people.