CHAPTER 2

ACQUISITION OF POSSESSION
Art. 531. Possession is acquired by the material occupation of a thing or the exercise of a
right, or by the fact that it is subject to the action of our will, or by the proper acts and legal
formalities established for acquiring such right. (438a)
Ways of acquiring possession
To be considered in possession, one need not have actual or physical occupation of a thing all
times. There are three ways of acquiring possession, namely:
1. By the material occupation or exercise of a right;
2. By the subjection of the thing or right to our will; and
3. By proper acts and legal formalities established for acquiring such right of possession.
The modes of acquiring ownership can be seen in Article 712.
Material occupation or exercise of right
1. With respect to things the law requires material occupation as one of the modes of acquiring
possession.
2. With respect to rights since rights are intangible and cannot logically be occupied, what is
acquired is the exercise of a right. For example, possession of a servitude of way, which is a
right, is acquired by the exercise of the right (by passing over the servient land)
Material occupation by delivery
The material occupation of a thing as a means of acquiring possession may take place by
actual or constructive delivery. Constructive delivery includes:
1. Tradicion brevi manu which takes place when one already in possession of a thing by a title
other than ownership continues to possess the same under a new title, that of ownership.
2. Tradicion constitutum possessorium which happens when the owner continues in
possession of the property alienated not as owner but in some other capacity, such as that
of lessee, pledgee, or depositary.
Subject of the action of will
The second method of acquisition is so broad in scope that it practically covers all means of
acquiring possession.
What the law contemplates is a distinct cause of acquiring possession and not merely an effect.
It refers more to the right of possession than to possession as a fact.
Examples of which are these kinds of constructive delivery:
1. Tradicion longa manu, which is effected by the mere consent or agreement of the parties, as
when the vendor merely points to the thing sold
2. Tradicion simbolica, which is effected by delivering an object such as a key where the thing
sold is stored or kept
Proper acts and legal formalities
This last method of acquiring possession refers to acquisition by virtue of a just title such as
when property is transmitted by succession, donation, contract, or execution of a public
instrument, or when possession is given by the sheriff to the highest bidder at a public auction,
or pursuant to a writ of execution.
Unless there is a stipulation to the contrary, the execution of a sale thru a public instrument shall
be equivalent to the delivery of the thing. But there is no delivery notwithstanding the execution
of the instrument, where the purchaser cannot have the enjoyment and make use of the thing

sold because such enjoyment and use are opposed or prevented by another.
Under Article 538, possession as a fact cannot be recognized at the same time in two different
personalities except in the cases of co-possession
A sale with pacto de retro transfers the legal title to the vendee, and in the absence of an
agreement to the contrary, carries with it the right to the possession of the property sold.

Case doctrines
Possession alone is not sufficient to acquire title to alienable lands of the public domain
because the law requires possession AND occupation.
Possession is broader than occupation because it includes constructive possession. When the
lad adds the word occupation, it seeks to delimit the all encompassing effect of constructive
possession. Ones possession must not be a mere fiction. Acutla possession of a land consists
in the manifestation of acts of dominion over it of such a nature as a party would naturally
exercise over his own property. (Ong v Republic)
Possession cannot be acquired through force or violence. To all intents and purposes, a
possessor, even if physically ousted, is still deemed the legal possessor. (Cequena v Bolante)
Art. 532. Possession may be acquired by the same person who is to enjoy it, by his legal
representative, by his agent, or by any person without any power whatever: but in the last
case, the possession shall not be considered as acquired until the person in whose name
the act of possession was executed has ratified the same, without prejudice to the juridical
consequences of negotiorum gestio in a proper case. (439a)
By whom possession acquired
Possession may be acquired:
1. Personally or by the same person who is to enjoy it;
2. Thru an authorized person or by his legal representative or by his agent, and
3. Thru an unauthorized person or by any person without any power or authority whatever.
Acquisition of possession through another
Possession acquired by a person personally or thru another may be exercised by him in his own
name or in that of another. But minors and other incapacitated persons need the assistance of
their legal representatives to exercise the rights arising from possession.
If a person authorized to acquired possession for another acted beyond his powers, the
principal is not bound unless the latter ratifies the act of acquisition.
The exception is when a person voluntarily manages the property or business of another. In
such case, the strangers (gestors) possession takes effect even without ratification by the
owner of the property or business.
Case doctrines
Art. 533. The possession of hereditary property is deemed transmitted to the heir without
interruption and from the moment of the death of the decedent, in case the inheritance is
accepted.
One who validly renounces an inheritance is deemed never to have possessed the
same. (440)
Acquisition of possession through succession
The rights to the succession are transmitted from the moment of the death of the decedent.
From that moment, each of his heirs becomes the undivided owner of the whole estate left with

respect to that portion which might be adjudicated to him.

The inheritance may be accepted or repudiated.
There is no doubt that an heir can sell whatever right, interest or participation he may have in
the property under administration, subject to the result of said administration.
In case the inheritance is accepted, the possession of the hereditary property is deemed
transmitted by operation of law to the heir without interruption and from the moment of death of
the decedent.
In this inheritance is validly renounced, the heir is deemed never to have possessed the same.
See book for examples.

Art. 534. On who succeeds by hereditary title shall not suffer the consequences of the
wrongful possession of the decedent, if it is not shown that he was aware of the flaws
affecting it; but the effects of possession in good faith shall not benefit him except from the
date of the death of the decedent. (442)
Effects of bad faith of decedent on heir
If the decedent was in bad faith, the heir shall not suffer the consequences of the wrongful
possession of the latter because bad faith is personal to the decedent and is not deemed
transmitted to the heirs.
The heir suffers the consequences of such possession only from the moment he becomes
aware of the flaws affecting the decedents title.
See book again for examples.
Case doctrines
A possessor in bad faith should not prejudice his successors-in-interest. Bad faith is personal
and intransmissible. (Escritor v IAC)
Art. 535. Minors and incapacitated persons may acquire the possession of things; but they
need the assistance of their legal representatives in order to exercise the rights which from
the possession arise in their favor. (443)
Acquisition and exercise of rights of possession by minors and incapacitated persons
The persons referred to in the provision are unemancipated minors and other persons who have
no capacity to act like spendthrifts, deaf-mutes who cannot read and write, those under civil
interdiction, etc.
Things here are limited to corporeal things only.
This article refers principally but not exclusively to material occupation.
Incapacitated persons may acquire property or rights by prescription either personally or
through their parents, guardians or legal reps. Once possession of a thing is acquired by such
persons, there is born the right of possession. In the exercise of this right, they need the
assistance of their legal reps.
Art. 536. In 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 a 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. (441a)
Recourse to the courts
Every possessor has a right to be respected in his possession. The lawful possessor may use
such force as may be reasonably necessary to repel or prevent invasion or usurpation of his
property.

This article applies to one who believes himself the owner of real property. If he takes justice
into his own hands, he is a mere intruder; and he can be compelled to return the property in an
action for forcible entry and must suffer the necessary and natural consequences of his
lawlessness.
A party who can prove prior possession, whatever may be the character of the possession, has
the security that entitles him to recover such possession or to remain on the property even
against the owner himself until he is lawfully ejected by accion publiciana or accion
reivindicatoria.

Art. 537. Acts merely tolerated, and those executed clandestinely and without the
knowledge of the possessor of a thing, or by violence, do not affect possession. (444)
Acts which do not give rise to possession
The acts mentioned do not affect possession, i.e. the person in possession does not lose the
same nor does the person who results to them acquire it. In other words, the true possessor is
deemed to have enjoyed uninterrupted possession.
o Force or intimidation as long as there is a possessor who objects thereto, such as by
suit of forcible entry. The rule does not apply if the possessor makes no objection,
withdraws his objection or takes no action whatsoever after initially objecting to the
deprivation.
o Acts executed clandestinely and without the knowledge of the possessor which mean
that the acts are not public and unknown to the possessor or owner.
o Acts merely tolerated which do not refer to all kinds of tolerance on the part of the
owner or possessor in view of the use of the word merely; it means permission, express
or tacit, by virtue of which the acts of possession are performed. Hence, it is simply a
question of whether permission was given or not.
Possession of another by mere tolerance is not adverse and no matter how long continued,
cannot ripen to ownership by prescription.
The mere silence or failure to take any action will not be construed as abandonment of rights on
the part of the real possessor. It is, of course, for the courts to decide whether there has been
an abandonment or not.
Possession by tolerance is lawful but becomes illegal when, upon demand to vacate by the
legal owner, the possessor refuses to comply with such demand.
Art. 538. Possession as a fact cannot be recognized at the same time in two different
personalities except in the cases of co-possession. Should a question arise regarding the
fact of possession, the present possessor shall be preferred; if there are two possessors,
the one longer in possession; if the dates of the possession are the same, the one who
presents a title; and if all these conditions are equal, the thing shall be placed in judicial
deposit pending determination of its possession or ownership through proper proceedings.
(445)
Possession as a fact at the same time in two different personsalities
The word personalities is not synonymous to persons. For example, in co-ownership, there
are two or more persons, but there is only one personality.
Possession as a fact may exist at the same time in two or more distinct personalities, but as a
general rule, the law will recognize only one as the actual or real possessor.
The exception is provided in the cases of co-possession, such as co-ownership, where the
property is possessed at the same time in common by the co-owners also; and possession
where the property is possessed at the same time by two persons, one in the concept of owner

and the other, in the concept of holder.

In co-possession, there is no conflict of interests of claims among the parties.

Preference of possession
Article 538 applies whether the property is real or personal. In case a dispute arises regarding
the fact of possession, the order of preference is as follows:
1. The present or actual possessor shall be preferred
2. If there are two possessors, the longer in possession;
3. If the dates of possession are the same, the possessor with a title; i.e. right or document
evidencing his right to support his possession; and
4. If all the above are equal, the fact of possession shall be judicially determined, and in the
meantime, the thing shall be placed in judicial deposit.

CHAPTER 3
EFFECTS OF POSSESSION
Art 539 Every possessor has a right to be respected in his possession and should he be
disturbed therein he shall be protected in or restored to said possession by the means
established by the laws and the Rules of Court.
A possessor deprived of his possession through forcible entry may within ten days
from the filing of the complaint present a motion to secure from the competent court, in the
action for forcible entry, a writ of preliminary mandatory injunction to restore him in his
possession. The court shall decide the motion within thirty days from the filing thereof.
Rights of every possessor
Every possessor, whether in the concept of owner of in the concept of holder, is given the following
rights:
1. Right to be respected in his possession;
2. Right to be protected in or restored to said possession by legal means should he be disturbed
therein; and
3. Right to secure from a competent court in an action for forcible entry the proper writ to restore
him in his possession (Art 428)

The mere possession of a thing is sufficient to insure respect to the possessor while no other
person appears to show and prove a better right.
To all intents and purposes, a possessor even if physically ousted as through force and
violence, is still deemed the legal possessor.

The fact, however, that a person was never in prior physical possession of a land is of no moment
where he has a Torrens Title over the property as prior physical possession is necessary only in
forcible entry cases.
Reasons for protection
1. To aid criminal law (by preserving the peace. Order is best secured by protecting a possessor
and leaving the true owner to seek his remedy in a court of law)
2. As part of the law of tort (these rights of action are given in respect of the immediate and
present violation of the rights of the possessor independently of his rights of property)

3. As part of the law of property (law does not always known that the possession in question is
unlawful. It would be unjust to cast on every man whose possession is disturbed the burden of
proving a flawless title)
Remedies of persons deprived of possession (see discussions in Art 428)
1. forcible entry or unlawful detainer
2. accion publiciana
3. accion reivindicatoria
4. replevin or manual delivery of personal property

In forcible entry and unlawful detainer cases, subject to some exceptions, the immediate
execution of the judgment in favor of the plaintiff is a matter of right and mandatory.
Considering that the only issue in ejectment is that of rightful possession, damages that could
be recovered are those which the plaintiff could have sustained as a mere possessor, or those
caused by the loss of the use and occupation of the property, and not the damages which he
may have suffered but which have no direct relation to his loss of material possession.

Issuance of a writ of preliminary mandatory injunction

In forcible entry actions, the plaintiff must present within ten days from the filing of the complaint
a motion to secure from the competent court, a writ of preliminary mandatory injunction to
restore him in his possession
In unlawful detainer cases where an appeal is taken, the motion shall be filed within ten days
from the time the appeal is perfected, if the high court is satisfied that the lessees appeal is
frivolous or dilatory, or the lessors appeal is prima facie meritorious.
In an appeal from a lower court in an ejectment case, the issue of ownership should not be
delved into, for an ejectment action lies even against the owner of a property.
Prior peaceful possession of plaintiff required in forcible entry action
Where a dispute over possession arises between two persons, the person first having actual
possession, as between them, is the one who is entitled to maintain the action for forcible entry.
The main issue is possession de facto, independently of any claim of ownership or possession
de jure that either party may set forth in his pleadings, and an appeal does not operate to
change the nature of the original action
Even a mere applicant of public land who is in occupation and in peaceful possession thereof
can file an action for forcible entry
Question of ownership is unessential and should be raised by the defendant in an appropriate
action
o Judgment rendered in an action for forcible entry shall not bar an action between the
same parties respecting the title to the land or building
o The court has competence to resolve the issue of ownership but only to determine the
issue of priority of possession, as its decision does not bind the title or affect the
ownership of the property involved (any pronouncement on ownership is provisional)
The purpose of the law is to protect the person who has actual possession
The plaintiff in an action for forcible entry and detainer cannot succeed when it appears that, as
between himself and the defendant, the latter had possession antedating his own; and to
ascertain this, it is proper to look on to the situation as it existed before the first act of spoliation
occurred
Legal right of prior possessor is not an issue
o If the plaintiff can prove prior possession, he may recover possession even against the
owner himself.

If he cant prove prior possession, he has no right of action even if he should be the
owner himself.
In case of controverted right, the law requires the parties to preserve the status quo until one or
the other of them sees fit to invoke the decision of a court upon the question of possession
and/or possession
A forcible entry or unlawful detainer is not suspended, abated, barred or affected by actions filed
in the RTC which do not involve physical or de facto possession
o

Conditions under which action for forcible entry will lie

Wrongful entrance by one not in possession
o The trespasser does not have to institute a state of war. The act of going on the property
and excluding the lawful possessor therefrom necessarily implies the exertion of force
over the property, and this is all that is necessary. Under the law, entering upon the
premises by strategy or stealth is equally as obnoxious as entering by force.
o The words by force, intimidation, threat, etc include every situation or condition under
which one person can wrongfully enter upon real property to exclude another, who has
prior possession therefrom. (Banes case)
Wrongful exclusion of prior possessor
o The foundation of the action is really the forcible exclusion of the original possessor by a
person who has entered without right.
Art 540 Only the possession acquired and enjoyed in the concept of owner can serve as a
title for acquiring dominion.
Possession as basis for acquiring ownership
Possession acquired and enjoyed in the concept of owner may ripen into ownership by means of
prescription.
1. As holder
Cannot be the basis of prescription
So with possession acquired through force or intimidation (Art 536), merely tolerated or
which is not public and is unknown to the present possessor (Art 537)
2. As equitable mortgage
Constructive possession over the land cannot ripen into ownership as it cannot be said to
have been acquired and enjoyed in the concept of owner
3. As claimant under a possessory information title (meh)
4. As claimant under a certificate of title
Mere possession cannot defeat the title of a holder of a registered Torrens title to real
property
But the true owner of the property may be defeated by an innocent purchaser for value
notwithstanding the fraud employed by the seller (forger) in securing his title
Generally, a forged deed is a nullity and conveys no title. However, there are instances when
such a document may become the root of a valid title. As when the certificate of title was
already transferred from the name of the true owner to the forger, and while it remained that
way, the land was subsequently sold to an innocent purchaser for value (land titles!)
5. As possessor of forest land (not possible!)

Mere tax declarations of ownership do not vest or prove ownership of the property in the
declarant nor are even sufficient to sustain a claim for possession over a land, in the absence of
actual possession of the same.

They are merely an indicum of a claim of ownership

Nevertheless, they are good indicia of possession in the concept of owner
Payment of realty tax coupled with actual possession in the concept of owner is one of the most
persuasive and positive indicia, which shows the will or desire of a person to possess with claim
of ownership or to obtain title to the land or property

Case doctrine
In order than an action for recovery of possession may prosper, it is indispensable that he who
brings the action fully proves not only his ownership but also the identity of the property claimed,
by describing the location, area and boundaries thereof. Insufficient identification of the portion
of land claimed in absolute ownership cannot ripen into ownership. (Serina v Caballero)
Art 541 A possessor in the concept of owner has in his favor the legal presumption that he
possesses with a just title and he cannot be obliged to show or prove it.
Possessor in concept of owner presumed with just title
Just title does not always mean a document or a written instrument
Title is that upon which ownership is based
Actual or constructive possession under claim of ownership raises the disputable presumption
of ownership. In other words, a possession is presumed ownership until the contrary is shown.
A possessor is presumed to have a just title, and he cannot be obliged to show or prove it.
o Reason? To protect the owner from inconvenience, otherwise, he will always have to
carry his titles under his arms to show them to whoever who wants to see it
NB: Presumption of just title does not apply in acquisitive prescription. Adverse possessor must
prove his just title.
Burden of proving just title
The onus probandi is on the plaintiff who seeks the recovery of property
A person who is not, in fact, in possession cannot acquire a prescriptive right to a land by the
mere assertion of a right therein. Where the possessor is really the owner, the fact that a third
person questions his right does not impair said right.
An owner and possessor whose title is true and valid cannot be required to show that his
possession is or has been adverse as against a new claimant who has neither title nor
possession.
What are the different kinds of title?
1. Titulo verdadero y valido or true and valid
This is the title presumed in this provision
Sufficient to transfer ownership without need of possessing the property for the period
necessary for acquiring title by prescription
2. Titulo justo or just title
For the purposes of prescription, there is just title
o When the adverse claimant came into possession of the property through one of the
modes recognized by law for the acquisition of ownership or other real rights,
o but the grantor was not the owner or could not transmit any right
For prescription, just title must be proved, it is never presumed.
It must be remembered that the burden of proving the status of a purchaser in good faith lies
upon him who asserts that status. It is not sufficient to invoke the ordinary presumption of
good faith, that is, that everyone is presumed to have acted in good faith, since the good

faith that is here essential is integral with the very status that must be established. (Aguirre v
CA)
3. Titulo colorado or colorable title
One which a person has when he buys a thing in good faith, from one who is not the owner
but whom he believes to be the owner
The just title required for acquisitive prescription is titulo Colorado
4. Titulo putativo or putative title
One which a person believes he has title but in fact he has not because there was no mode
of acquiring ownership
As when one is in possession of a thing in the mistaken belief that it had been bequeathed
to him
Whats the difference between titulo Colorado and titulo verdadero y valido? In Colorado, there is a
need for prescription to transfer ownership. In true and valid title, there is no need for prescription,
ownership is transferred once the mode of transfer has been perfected. (Be it by sale, donation,
succession, etc).
Case doctrine
In order that a co-owners possession may be deemed adverse to the cestui que trusti or the
other co-owners, the following elements must concur:
1. That he has perfomrmed unequivocal acts of repudiation amounting to an ouster of the
beneficiary or the other co-owners
2. That such positive acts of repudiation have been made known to the beneficiary or the other
co-owners
3. That the evidence thereon must be clear and convincing (Aguirre v CA)
Art 542 The possession of real property presumes that of movables therein, so long as it is
not shown or proved that they should be excluded.
Possession of real property presumed to include movables
Article 542 refers to material possession only of things, not rights
Possession may be in the concept of owner, of holder, in ones own name or in anothers, or in
good faith or in bad faith
It is normal that movables which are found in an immovable belong to the possessor of the latter
If the building is occupied by the lessee, we can suppose the same with respect to him because
in this case, the possessor is the lessee
Again, this is a mere presumption.
Art 543 Each one of the participants of a thing possessed in common shall be deemed to
have exclusively possessed the part which may be allotted to him upon the division thereof,
for the entire period during which the co-possession lasted. Interruption in the possession
of the whole or a part of a thing possessed in common shall be to the prejudice of all the
possessors. However, in case of civil interruption, the Rules of Court shall apply.
Exclusive possession of previous co-owner deemed continuous
Article 543 speaks of co-possession of a thing, not of co-ownership
Nevertheless, its principle is applicable to co-possession of a real right
Co-possession can be over a thing or a right
All participants of a thing possessed in common constitute only one personality and the
personality ceases when there is a partition.

From that moment of cessation, the personality of each participant begins.

Each co-possessor is deemed (not merely presumed!) to have possessed exclusively and
continuously during the period of co-possession the part assigned to him in the division.
The effects of the division retroact to the commencement of the co-possession.
But the division shall be without prejudice to the rights of creditors.

Harry, Ron, and Hermione have been co-possessors in the concept of owners of a 15 hectare
parcel of land until they divided the property equally on the 8 th year. If on the 4th year after the
division, Draco claims ownership of the portion allotted to Harry, Harry can assert title by acquisitive
prescription through possession for 10 years, for he is deemed to have possessed his portion
exclusively and continuously for a period of 12 years.
Interruption in possession of the thing
Both the benefits and the prejudices that might have taken place during the co-possession shall
attach to each of the co-participants
Prescription obtained by a co-possessor shall benefit the others
Interruption in the possession of the whole or part of a thing shall be to the prejudice of all the
possessors.
Possession is interrupted for purposes of prescription either
o Naturally (when through any cause it should cease for more than 1 year)
o Civilly (when the interruption is produced by judicial summons to the possessor)
In civil interruption, only those possessors served with judicial summons are
affected.
For civil interruption to take place, the possessor must have received judicial
summons.
When will summons not be deemed to have been issued and shall not give rise to
interruption?
1. If it should be void for lack of legal solemnities, or
2. If the plaintiff should desist from the complaint or should all the proceedings to
lapse, or
3. If the possessor should be absolved from the complaint.
A notice for adverse claim does NOT interrupt prescription (Heirs of ArzadonCrisologo v Ranon)
Interruption must refer to the whole thing itself or part of it and not to a part or right of a copossessor.
In a co-possession, there is only one thing and many possessors. If the right of a co-possessor
is contested, he alone shall be prejudiced.
With respect to the thing, the prejudice shall be against all.
Art 544 A possessor in good faith is entitled to the fruits received before the possession is
legally interrupted.
Natural and industrial fruits are considered received from the time they are gathered
or severed.
Civil fruits are deemed to accrue daily and belong to the possessor in good faith in
that proportion.
Art 545 If at the time the good faith ceases, there should be any natural or industrial fruits,
the possessor shall have a right to a part of the expenses of cultivation, and to a part of the
net harvest, both in proportion to the time of possession.
The charges shall be divided on the same basis by the two possessors.

The owner of the thing may, should he so desire, give the possessor in good faith the
right to finish the cultivation and gathering of the growing fruits, as an indemnity for his part
of the expenses of cultivation and the net proceeds; the possessor in good faith who for any
reason whatever should refuse to accept this concession, shall lose the right to be
indemnified in any other manner.

The fruits of a thing generally belong to the owner (Art 441) but a possessor in good faith is
entitled to the fruits received until good faith ceases and bad faith begins.
Legal interruption of possession in good faith takes place upon service of judicial summons to
the possessor.
o All fruits that the possessor may receive from the time that he is summoned, or when he
answers the complaint, must be delivered or paid by him to the owner or lawful
possessor.
Whenever there is cessation of good faith in the eyes of the law, whether by reason of the filing
of a complaint or not, possession in good faith should be deemed legally interrupted from such
cessation and not merely from the service of judicial summons.
When the owner or possessor with a better right comes along, when he becomes aware that
what he had taken for granted is at least doubtful, and when he learns the grounds in support of
the adverse claim, good faith ceases.
Possessor in bad faith is not entitled to the fruits. He has the duty to reimburse the fruits
received including that which the legitimate possessor could have received.
The right of the possessor in good faith is limited to the fruits, referring to natural, industrial and
civil fruits (Art 441). Other things (building) belong to the owner of the land.

When fruits considered received

1. For natural and industrial fruits from the time they are gathered or severed. Fruits gathered
before legal interruption belong to the possessor in good faith.
2. For civil fruits their accrual, not their actual receipt, shall determine when they are considered
received at the time the good faith is legally interrupted. They are deemed to accrue daily and
belong to the possessor in good faith in that proportion.
Kinds of Fruits
1. Civil fruits

Possessor in
Good Faith
Entitled to fruits
from start of
possession until
legal interruption

Possessor in Bad
Faith
Not entitled to
fruits.

Right to retain
fruits

Must account for

fruits and return
value of:
fruits actually
received, and

Must pay
damages as
rental from time
possession
started until
possession is
finally defeated

2. Natural/Industr
ial Fruits
a. Gathered

fruits which the

legal possessor
could have
received with due
care and
diligence.
Must pay
damages as
reasonable rent
for the term of
possession.
b. Pending
Owner has 2
options:
First: Pro-rating
(based on period
of possession)
between
possessor and
owner of:
expenses, net
harvest and
charges

But entitled to
necessary
expenses for
preservation,
cultivation, and
gathering of
fruits.

No rights, not
even
reimbursement of
expenses for
cultivation
(because by right
Second: To allow of accession, all
possessor to
fruits belong to
stay in
owner without
possession until need to pay
after all fruits are indemnity)
gathered (which
shall serve as
Must pay
the indemnity for damages as
expenses)
reasonable rent
for the term of
possession
Proportionate division of fruits and expenses
Art 545 does not apply when the possessor is in bad faith, the fruits are civil, or the fruits are
natural or industrial but they have been gathered or severed when good faith ceases
A possessor in bad faith has no right whatsoever to the fruits, gathered or pending, except only
necessary expenses for gathered fruit (Art 443, 449). Since civil fruits are produced day by day,
Art 545 does not apply to them.
In the case of fruits already gathered at the time good faith ceases, it is Art 544 that is
applicable.
If there are pending natural and industrial fruits at the time good faith ceases, the two
possessors shall share in the expense of cultivation and the charges (expenses made not on

the property itself but on account of it, such as taxes, interest on mortgages) in proportion to the
time of possession.
They will also share on the fruits in proportion to the time of possession as well.
What if there are no fruits or the fruits are less than expenses?
o If there is no net harvest because there are no fruits or the fruits are less than the
expenses, art 545 wont apply. If the fruits are merely insufficient, the same should be
divided in proportion to their respective expenses.
o No fruits? Each should bear his own expenses subject to the right of the possessor in
good faith to be refunded for necessary expenses under Art 546, unless the owner of
new possessor exercises his option referred to above.

Art 546 Necessary expenses shall be refunded to every possessor; but only the possessor
in good faith may retain the thing until he has reimbursed therefore.
Useful expenses shall be refunded only to the possessor in good faith with the same
retention, the person who has defeated him in the possession having the option of
refunding the amount of the expenses or of paying the increase in value which the thing
may have acquired by reason thereof.
Art 547 If the useful improvements can be removed without damage to the principal thing,
the possessor in good faith may remove them, unless the person who recovers the
possession exercises the option under paragraph 2 of the preceding article.
Art 548 Expenses for pure luxury or mere pleasure shall not be refunded to the possessor in
good faith; but he may remove the ornaments with which he has embellished the principal
thing if it suffers no injury thereby, and if his successor in the possession does not prefer to
refund the amount expended.
Art 549 The possessor in bad faith shall reimburse the fruits received and those which the
legitimate possessor could have received, and shall have a right only to the expenses
mentioned in paragraph 1 of Article 546 and in Article 443. The expenses incurred in
improvements for pure luxury or mere pleasure shall not be refunded to the possessor in
bad faith, but he may remove the objects for which such expenses have been incurred,
provided that the thing suffers no injury thereby, and that the lawful possessor does not
prefer to retain them by paying the value they may have at the time he enters into
possession.
Expenses
Necessary
Expenses

Possessor in
Good Faith
Entitled to
reimbursement
Right of retention
pending full
reimbursements

Possessor in Bad
Faith
Entitled to
reimbursement
No right of
retention; must
vacate property
(recourse is to
file collection
case)
Liable for
damages as
reasonable rent
for period of
possession

Useful expenses

Owner has 2
options:

No rights

Option 1:
reimbursement of
either (a) amount
spent or (b)
increase in value
with right of
retention with full
payment.

Luxurious
expenses

Deterioration/loss

Option 2: To
allow possessor
to remove
provided no
substantial
damage or injury
is caused
Owner has 2
options:

Owner has 2
options:

Option 1: to allow
possessor to
remove
ornaments if the
principal suffers
no injury

Option 1: to allow
possessor to
remove
ornaments if the
principal suffers
no injury

Option 2: to
retain the
ornament by
refunding the
amount spent for
the ornament

Option 2: to
retain the
ornament by
refunding the
value of the
ornament at the
time owner
enters into
possession
(which means
depreciated
value)
Always liable
whether before or
after service of
judicial
summons, for
any cause, even
fortuitous event.

No liability unless
due to fraudulent
intent or
negligence after
service of judicial
summons

Necessary expenses are made for the preservation of the thing of those which seek to prevent

the waste, deterioration, or loss of the thing; or those without which the thing would deteriorate
or be lost.
Useful expenses are expenses which add value to a thing, or augment its income.
Luxurious expenses are expenses not necessary for the preservation of a thing nor do they
increase its productivity although they add value to the thing, but are incurred merely to
embellish the thing and for the convenience or enjoyment of particular possessors.

Case doctrine
A possessor in bad faith is entitled to be reimbursed for her expenses in restoring a house to its
original condition after it had been partly damaged by fire, because such expenses are
necessary, and under 546, are to be refunded even to possessors in bad faith.
A builder in bad faith, under 449, is not entitled to reimbursement. But 449 is a rule of
accession, which is not applicable where a new house was not built on the land of another but
only repairs were made on a house that had been partly destroyed by fire. This latter case
comes under 546 which provides for the refund of necessary expenses to every possessor.
(Cosio v Palileo)
Art. 550. The costs of litigation over the property shall be borne by every possessor. (n)
Art. 551. Improvements caused by nature or time shall always insure to the benefit of the
person who has succeeded in recovering possession. (456)
Improvements caused by nature or time
Article 551 covers all the natural accessions mentioned in Articles 457 to 465 which must follow
the ownership of the principal thing, and generally, all improvements that are not due to the will
of the possessor.
The former possessor got the benefits from the property during his possession. It is but just that
the improvements mentioned which take place after the possession is recovered inure to the
owner or lawful possessor. Hence, he should not pay for them.
Art. 552. A possessor in good faith shall not be liable for the deterioration or loss of the
thing possessed, except in cases in which it is proved that he has acted with fraudulent
intent or negligence, after the judicial summons.
A possessor in bad faith shall be liable for deterioration or loss in every case, even if
caused by a fortuitous event. (457a)
Art. 553. One who recovers possession shall not be obliged to pay for improvements which
have ceased to exist at the time he takes possession of the thing. (458)
Improvements which have ceased to exist
The improvements referred to were enjoyed by the possessor alone.
Having ceased to exist, the owner or lawful possessor who came too late cannot benefit from
them. But he is liable for necessary expenses even if the thing for which they were incurred no
longer exists.
Necessary expenses are not considered improvements.
Art. 554. A present possessor who shows his possession at some previous time, is
presumed to have held possession also during the intermediate period, in the absence of
proof to the contrary. (459)

Presumption of possession during intervening period

This article contemplates a situation where a present possessor is able to prove his possession
of a property at a prior period but not his possession during the intervening period.
He is presumed to have possessed the property continuously without interruption, unless the
contrary is proved.
The presumption is useful for purposes of prescription.
Art. 555. A possessor may lose his possession:
1. By the abandonment of the thing;
2. By an assignment made to another either by onerous or gratuitous title;
3. By the destruction or total loss of the thing, or because it goes out of commerce;
4. By the possession of another, subject to the provisions of Article 537, if the new
possession has lasted longer than one year. But the real right of possession is not
lost till after the lapse of ten years. (460a)
Modes of losing possession
This provision applies to both real and personal property except no. 4 which obviously refers
only to personal property (obvious raw eh, sabi ni de Leon. Yabang naman niya). The next
article is expressly made applicable only to movables.
What is abandonment?
Abandonment is the voluntary renunciation of all rights which a person has over a thing thereby
allowing a third person to acquire ownership or possession thereof by means of occupancy.
The abandoner may be the owner or a mere possessor but the latter obviously cannot abandon
ownership which belongs to another. (obviously raw!)
Since abandonment involves the renunciation of a property right, the abandoner must have a
right to the thing possessed and the legal capacity to renounce it.
An owner of property cannot be held to have abandoned the same until at least he has some
knowledge of the loss of its possession or of the thing, and a thing cannot be considered
abandoned under the law until the spes recuperandi (hope of recovery) is gone and the animus
revertendi (intention to return) is finally given up.
By voluntary abandonment, a thing becomes without a owner or possessor and is converted
into res nullius and may thus be acquired by a third person by occupation.
Abandonment which converts the thing into res nullius can hardly apply to land.
Castellano v Francisco stated that abandonment requires:
1. A clear and absolute intention to renounce a right or a claim or to abandon a right or
property, and
2. An external act by which that intention is expressed or carried into effect.
The intention to abandon implies a departure, with the avowed intent of never returning,
resuming or claiming the right and the interest that have been abandoned. (Castellano v
Francisco)
Assignment?
Assignment is understood to mean the complete transmission of the thing or right to another by
any lawful manner.
It may be onerous or by gratuitous title.
The effect is that he who was the owner or possessor is no longer so.
Abandonment is always gratuitous.

Destruction, total loss, or withdrawal from commerce

Destruction or total loss covers not only that which is caused voluntarily or intentionally but also
that which is caused by accident.
A thing is lost when it perishes, or goes out of commerce, or disappears, etc. (Art 1189)
Possession of another for more than one year
This refers to possession de facto (as a fact or material possession) and not de jure (legal right
or real right of possession)
After one year, the former possessor can no longer bring any action for forcible entry or unlawful
detainer.
Possession by mere tolerance even for over a year does not affect possession de facto.
After 10 years, the possessor or owner may bring an accion publiciana or reivindicatoria to
recover possession de jure unless he is barred by prescription.
Recovery by lawful owner or possessor
Possession may also be lost when it is recovered from the person in possession by the lawful
owner in a reivindicatory action or by the lawful possessor in an action to recover the better right
of possession.
Art. 556. The possession of movables is not deemed lost so long as they remain under the
control of the possessor, even though for the time being he may not know their
whereabouts. (461)
Loss of possession of movables
The possession of movables shall be deemed lost when they cease to be under the control of
the possessor either becaue:
o They have come into the possession of a third person; or
o Although, they have not been taken by another,
The possessor has completely no idea of their whereabouts or location (the pet rat
has been missing for sometime; or
Even if known, they cannot be recovered, whether as a matter of fact (an
unopened box of pastillas has been dropped in a deep lake) or of law (a movable
lost by prescription).
Possession is not lost by the mere fact that the possessor does not know for the time being the
precise whereabout of a specific movable when he has not given up all hope of finding it (like a
ring misplaced or lost in particular vicinity). In this case, the possessor has not lost his legal right
to the object.
o He retains his juridical control of the thing which remains in his patrimony.
Art. 557. The possession of immovables and of real rights is not deemed lost, or transferred
for purposes of prescription to the prejudice of third persons, except in accordance with the
provisions of the Mortgage Law and the Land Registration laws. (462a)
Loss of possession of immovables and real rights with respect to third persons
Third persons are not prejudiced except in accordance with the provisions of the mortgage law
and the registration law.
Against a recorded title, ordinary prescription of ownership or real rights shall not take place to
the prejudice of a third person, except in virtue of another title also recorded and the time shall
begin to run from the recording of the latter.

Art. 558. Acts relating to possession, executed or agreed to by one who possesses a thing
belonging to another as a mere holder to enjoy or keep it, in any character, do not bind or
prejudice the owner, unless he gave said holder express authority to do such acts, or
ratifies them subsequently. (463)
Possessory acts of a mere holder
The possessor referred to in this article is the same possessor mentioned in Article 525.
Acts relating to possession of a mere holder do not bind or prejudice the possessor in the
concept of owner unless said acts were previously authorized or subsequently ratified by the
latter.
Possession may be acquired for another by a stranger provided there be subsequent
ratification. (Art 532)
Art. 559. The possession of movable property acquired in good faith is equivalent to a title.
Nevertheless, one who has lost any movable or has been unlawfully deprived thereof may
recover it from the person in possession of the same.
If the possessor of a movable lost or which the owner has been unlawfully deprived,
has acquired it in good faith at a public sale, the owner cannot obtain its return without
reimbursing the price paid therefor. (464a)
Right of possessor who acquires movable claimed by another
If the possession of a movable property who acquired in bad faith, no right thereto is acquired
by the possessor. The property may be recovered by the true owner or possessor without
reimbursement.
If the acquisition was in good faith, here are the rules:
o Possession in good faith of a movable is presumed ownership. It is equivalent to title. This is
known as the doctrine of irrrevindicability. No further proof is necessary.
o The possessors title, however, is not absolute. It is equivalent to title but is not title itself. It is
merely presumptive because it can be defeated by the true owner.
These are the two exceptions to the general rule of irrevindicability. An owner can recover in
these two instances:
1. When one has lost the movable, or
2. When one has been unlawfully deprived.
He may recover without reimbursement. But if the thing was sold at a public sale, the
owner must reimburse the buyer.
These are the exceptions to the exceptions. Even when an owner has lost or has been
unlawfully deprived, he still cannot recover in these instances:
1. When the sale is made at merchants stores, fairs or markets.
2. When the owner of the movable is, by his conduct, precluded from denying the sellers
authority to sell;
3. Where the law enables the apparent owner to dispose of the movables as if he were the
true owner thereof
4. Where the sale is sanctioned by statutory or judicial authority
5. Where the seller has a voidable title which has not been avoided at the time of the sale to
the buyer in good faith for value and without notice of the sellers defect of title
(remember CLV!)
6. Where recovery is no longer possible because of prescription
7. Where the possessor becomes the owner of the thing in accordance with the principle of
finders keepers

Case doctrines
Non-payment does not void a sale. It is perfected upon the meeting of the minds. Hence,
ownership shall pass from the vendor to the vendee upon the actual or constructive delivery of
the thing sold. It does not constitute unlawful deprivation of personal property. It is a mere
voidable sale, and unless it is avoided before the execution of the second sale, then the second
sale is valid. (EDCA v Santos)
Purchaser in good faith of a chattel or movable property is entitled to be respected and
protected in his possession as if he were the true owner thereof until a competent court rules
otherwise. In the meantime, as the true owner, the possessor in good faith cannot be compelled
to surrender possession nor to be required to institute an action for the recovery of the chattel.
(Edu v Gomez)
A third party who acquired in good faith a stolen vehicle and registered it in his own name
cannot lawfully refuse to return it to the true owner and insist upon reimbursement before
delivery. (Aznar v Yapdiangco stealing equals unlawful deprivation)
The owner of a ring pledged to a pawnshop by one to whom he has entrusted it to be sold on
commission can recover it from the pawnshop. (Dizon v Suntay)
Art. 560. Wild animals are possessed only while they are under one's control; domesticated
or tamed animals are considered domestic or tame if they retain the habit of returning to the
premises of the possessor. (465)
Possession of animals
Animals may be:
1. Wild or animals living in a state of nature independently of and without the aid and care of
man (great white shark, ornate wobbegong, brazilian slug)
2. Domesticated or tamed, or animals which are wild or savage by nature but have been
subdued and made use of by man and become accustomed to live in a tamed condition
(tiger ni Chavit)
3. Domestic or tame, or any of the various animals which live and are born and reared, under
the control and care of man, lacking the instinct to roam freely (dog, cat, carabao, cow)
Wild animals may be the object of hunting. They are possessed only if they are under ones
control. Possession of wild animals are lost when they regain their freedom or come under
anothers control.
Domesticated animals are possessed if they habitually return to the premises of the possessor.
Art. 561. One who recovers, according to law, possession unjustly lost, shall be deemed for
all purposes which may redound to his benefit, to have enjoyed it without interruption. (466)

This article applies to both possession in good faith as well as to possession in bad faith, but
only if beneficial to the possessor (like for purposes of prescription)
The recovery of possession must be according to law through legal means; otherwise, the
benefit of continuous and uninterrupted possession during the intervening period cannot be
invoked.