Professional Documents
Culture Documents
Moran, C. J.
FACTS: This case concerns the ownership of a parcel of land, partly rice-land and partly
residential. The lower court rendered judgment holding plaintiffs as the legal owners of
the whole property but conceding to defendants the ownership of the houses and
granaries built by them on the residential portion with the rights of a possessor in good
faith, in accordance with article 361 of the Civil Code.
Subsequently, the plaintiffs prayed for an order of execution alleging that since they
chose neither to pay defendants for the buildings nor to sell to them the residential lot,
said defendants should be ordered to remove the structure at their own expense and to
restore plaintiffs in the possession of said lot. Defendants objected to this motion which,
after hearing, was granted by Judge Natividad. Hence, this petition by defendants praying
for (a) a restraint and annulment of the order of execution issued by Judge Natividad; (b)
an order to compel plaintiffs to pay them the sum of P2,000 for the buildings, or sell to
them the residential lot for P45; or (c), a rehearing of the case for a determination of the
rights of the parties upon failure of extra-judicial settlement.
ISSUE: Whether the respondent Court erred in its judgment.
HELD: Yes. The Civil Code provides:
ART. 361. The owner of land on which anything has been built, sown or planted in good
faith, shall have the right to appropriate as his own the work, sowing or planting, after the
payment of the indemnity stated in articles 453 and 454, or to oblige the one who built or
planted to pay the price of the land, and the one who sowed, the proper rent.
ART. 453. Necessary expenses shall be refunded to every possessor; but only the
possessor in good faith may retain the thing until such expenses are made good to him.
Useful expenses shall be refunded to the possessor in good faith with the same right of
retention, the person who has defeated him in the possession having the option of
refunding the amount of the expenses or paying the increase in value which the thing
may have acquired in consequence thereof.
The owner of the building erected in good faith on a land owned by another, is entitled to
retain the possession of the land until he is paid the value of his building, under article
453. The owner of the land, upon the other hand, has the option, under article 361, either
to pay for the building or to sell his land to the owner of the building. But he cannot, as
respondents here did, refuse both to pay for the building and to sell the land and compel
the owner of the building to remove it from the land where it is erected. He is entitled to
another motion only when, after having chosen to sell his land, the other party fails to
pay for the same.
The Court holds, therefore, that the order of Judge Natividad compelling defendantspetitioners to remove their buildings from the land belonging to plaintiffs-respondents
only because the latter chose neither to pay for such buildings not to sell the land, is null
and void, for it amends substantially the judgment sought to be executed and is,
furthermore, offensive to articles 361 and 453 of the Civil Code.
occupied by them because it is the workable solution. Upon appeal petitioner contends
that Article 448 cannot be applied because they are co-owners of he subject property.
However, the appellate court affirmed in toto the decision of the trial court.
ISSUE: Whether or not Article 448 of the Civil Code is applicable in the case at bar.
HELD: Yes. It is true that Article 448 cannot be applied where a co-owner builds upon a
land owned in common. However, in the case at bar, the co-ownership has already been
terminated by virtue of the partition, thus, Article 448 now applies since the builder is not
anymore considered as an owner of the land where the house was built.
As to the workable solution applied by the lower court, the same cannot be upheld
because Article 448 clearly states that the right of choice belongs to the land owner and
not upon the builder and the courts. Thus, whether it might seem impractical, the
landowner may choose to appropriate the improvements.
FACTS: After appropriate proceedings, the Court of Appeals held, among other things,
that Filipinas Colleges, Inc. are declared to have acquired the rights of the spouses
Timbang in the questioned lots, they are ordered to pay the spouses Timbang in the
amount of P15,807.90 plus such other amount which said spouses might have paid or had
to pay. On the other hand, Maria Gervacio Blas was also declared to be a builder in good
faith of the school building constructed in the lot in question and was entitled to be paid
the amount of P19,000.00 for the same. Also, in case that Filipinas Colleges, Inc. failed
to deposit the value of the land, which after liquidation was fixed at P32,859.34, within
the 90-day period set by the Court, Filipinas Colleges would lose all its rights to the land
and the spouses Timbang would then become the owners thereof. If that is the case, the
Timbangs are ordered to make known to the court their option under Article 448 of the
Civil Code whether they would appropriate the building in question, in which even they
would have to pay Filipinas Colleges, Inc. the sum of P19,000.00, or would compel the
latter to acquire the land and pay the price thereof. Filipinas Colleges, Inc. failed to pay
the sum of P32,859.34 so the spouses Timbang made known to the court their decision
that they had chosen not to appropriate the building but to compel Filipinas Colleges,
Inc., for the payment of the sum of P32,859,34 which was granted by the Court. As a
consequence of which, a writ of execution was issued. Meanwhile, Blas filed a motion
for execution of her judgment representing the unpaid portion of the price of the house
sold to Filipinas which was granted. Levy was made on the house in virtue of the writs of
execution. Then, the Sheriff of Manila sold the building in public auction in favor of the
spouses Timbang, as the highest bidders. Several motion were the subsequently filed
before the lower court wherein the court held that: a) the Sheriff's certificate of sale
covering a school building sold at public auction was null and void unless within 15 days
from notice of said order spouses Timbang shall pay to Blas the sum of P5,750.00 that
the spouses Timbang had bid for the building at the Sheriff's sale; b) that Filipinas is
owner of 245.00/32,859.34 undivided interest in Lot No. 2-a on which the building sold
in the auction sale is situated; and c) that the undivided interest of the Filipinas in the lot
should be sold to satisfy the unpaid portion of the judgment in favor of Blas and against
Filipinas in the amount of P8,200.00 minus the sum of P5,750.00. The spouses Timbang
contends that because the builder in good faith has failed to pay the price of the land after
the owners thereof exercised their option under Article 448 of the Civil Code, the builder
lost his right of retention provided in Article 546 and that by operation of Article 445, the
spouses Timbang as owners of the land automatically became the owners ipso facto of
the school building.
ISSUE: Whether or not the spouses Timbang automatically become the owners of the building
upon failure of Filipinas to pay the value of the land.
HELD: No. Based on Article 448 and 546 of the New Civil Code, the owner of the land has the
right to choose between appropriating the building by reimbursing the builder of the value
thereof or compelling the builder in good faith to pay for his land. Even this second right cannot
be exercised if the value of the land is considerably more than that of the building. In addition to
the right of the builder to be paid the value of his improvement, Article 546 gives him the
corollary right of retention of the property until he is indemnified by the owner of the land. There
is nothing in the language of these two articles, 448 and 546, which would justify the conclusion
of appellants that, upon the failure of the builder to pay the value of the land, when such is
demanded by the land-owner, the latter becomes automatically the owner of the improvement
under Article 445. The case of Bataclan vs Bernardo cannot be applied in this case in the sense
that although it is true it was declared therein that in the event of the failure of the builder to pay
the land after the owner thereof has chosen this alternative, the builder's right of retention
provided in Article 546 is lost, nevertheless there was nothing said that as a consequence thereof,
the builder loses entirely all rights over his own building. Also, in the present case, the Court of
Appeals has already adjudged that appellee Blas is entitled to the payment of the unpaid balance
of the purchase price of the school building. Blas is actually a lien on the school building are
concerned. The order of the lower court directing the Timbang spouses, as successful bidders, to
pay in cash the amount of their bid in the sum of P5,750.00 is therefore correct.
Bernardo v. Bataclan
G.R. No. L-44606, November 28, 1938, 66 Phil. 598
Laurel, J.
FACTS: Bernardo bought a parcel of land from Samonte which was located in Cavite. In order
that he may take possession and occupy the said land, he filed a case in the CFI for such purpose
and the court rendered a favorable decision for Bernardo. However, when he was supposedly set
in occupying the said land, he found Bataclan. He was within the premises because he was
authorized by the previous owners to clear the land and make the necessary improvements he
deems fit, further claiming that such authorization was granted to him ever since 1922. Since
Bataclan was not a party in the first case, Bernardo filed against him a separate case. Bernardo
was declared owner but the defendant was held to be a possessor in good faith for whom the
work done and improvements made by him should be reimbursed. An appeal to the decision of
the court was filed by both Bernardo and Bataclan. The decision was modified by lowering the
price of the land from P300 to P200 per hectare. Bernardo was given 30 days to exercise his
option, whether to sell the land to Bataclan or to buy the improvements from him. Bernardo
chose the option which would require Bataclan to pay him the value of the land at the rate of
P200 per hectare. However, Bataclan informed the court that he will not be able to pay for the
price of the land. The court then gave Bataclan 30 days to pay the price of the property and after
the lapse of the period, the land shall be sold in a public auction. After 30 days, the land was sold
to Teodoro at a public auction, after failure of Bataclan to pay within the period the purchase
price.
ISSUE: Whether or not Bataclan has the right of retention over the parcel of land in question.
HELD: No. Bataclan no longer has lost the right of retention. The option of the owner was
already exercised where he decided that he will just allow the defendant to purchase the land
such that Bataclan was to comply with the option if he wants to retain the land. From the moment
that he told the courts of his inability to pay for the price of the land, he already lost his right to
retain the land.
5 square meters of the land pertaining to plaintiffs which the defendants obviously built
in good faith, then the provisions of Article 448 of the new Civil Code should apply.
Manresa and Navarro Amandi agree that the said provision of the Civil Code may apply
even when there was co-ownership if good faith has been established.
2.) It depends. Applying Article 448 of the Civil Code, the plaintiffs have the right to
appropriate said portion of the house of defendants upon payment of indemnity to
defendants as provided for in Article 546 of the Civil Code. Otherwise, the plaintiffs may
oblige the defendants to pay the price of the land occupied by their house. However, if
the price asked for is considerably much more than the value of the portion of the house
of defendants built thereon, then the latter cannot be obliged to buy the land. The
defendant shall then pay the reasonable rent to the plaintiffs upon such terms and
conditions that they may agree. In case of disagreement, the trial court shall fix the terms
thereof. Of course, defendants may demolish or remove the said portion of their house, at
their own expense, if they so decide.
HELD: 1.) No. Unless one is versed in the science of surveying, no one can determine
the precise extent or location of his property by merely examining his paper title. There
is no question in that when Technogas purchased the land from Pariz Industries, the
buildings and other structures were already in existence. Furthermore, it is not clear as to
who actually built these structures but it can be assumed that the predecessor-in-interest
of Technogas, Pariz Industries, did so. An article 527 of the New Civil Code presumes
good faith. Since no proof exists to show that the builder built the encroaching structures
in bad faith, the structures should be presumed to have been built in good faith. Good
faith consists in the belief of the builder that the land he is building on is his, and his
ignorance of any defect or flaw in his title. Furthermore, possession acquired in good
faith does not lose this character except in case and from the moment facts exist which
show that the possessor is not aware that he possesses the thing improperly or
wrongfully. The good faith ceases from the moment the defects in the title are made
known to the possessor, by extraneous evidence or by suit for recovery of the property of
the true owner.
2.) Yes. Has been shown, contrary as to the good faith of Technogas has not
been overthrown. Similarly, upon delivery of the property to Pariz Industries,
as seller, to Technogas, as buyer, the latter acquired ownership of the
property. Consequently, Technogas is deemed to have stepped into the shoes
of the seller with regard to all the rights of ownership of the property over the
immovable sold, including the right to compel Uy to exercise either of the
two options under Article 448 of the New Civil Code. Thus, the landowners
exercise of his option can only take place after the builder shall have to know
the intrusion in short, when both parties shall have become aware of it.
Only then will the occasion for exercising the option arise, for it is only then
that both parties will have been aware that a problem exists with regard to
their property rights.
owner of the lot in question at the time the lease contract was executed in 1978, in view
of its acquisition by Maria Lee as early as 1972, there was no lease to speak of, much
less, a renewal thereof. And even if the lease legally existed, its implied renewal was not
for the period stipulated in the original contract, but only on a month-to-month basis
pursuant to Article 1687 of the Civil Code. The refusal of the petitioners' mother to
accept the rentals starting January 1986 was then a clear indication of her desire to
terminate the monthly lease. As regard the petitioners' alleged failed promise to sell to
the private respondents the lot occupied by the house, the court held that such should be
litigated in a proper case before the proper forum, not an ejectment case where the only
issue was physical possession of the property.
The court resolved the second issue in the negative, holding that Articles 448 and 546 of
the Civil Code, which allow possessors in good faith to recover the value of
improvements and retain the premises until reimbursed, did not apply to lessees like the
private respondents, because the latter knew that their occupation of the premises would
continue only during the life of the lease. Besides, the rights of the private respondents
were specifically governed by Article 1678, which allow reimbursement of up to one-half
of the value of the useful improvements, or removal of the improvements should the
lessor refuse to reimburse.
On the third issue, the court deemed as conclusive the private respondents' allegation that
the value of the house and improvements was P180,000.00, there being no controverting
evidence presented.
On appeal by the private respondents, the RTC of Dagupan City reversed the trial court's
decision.
ISSUE: Whether or not Article 448 or Article 1678 of the Civil Code should apply in the
instant case.
HELD: In this case, both parties admit that the land in question was originally owned by
the petitioners' mother. The land was allegedly acquired later by one Maria Lee by virtue
of an extrajudicial foreclosure of mortgage. Lee, however, never sought a writ of
possession in order that she gain possession of the property in question. The petitioners'
mother therefore remained in possession of the lot. It has been said that while the right to
let property is an incident of title and possession, a person may be lessor and occupy the
position of a landlord to the tenant although he is not the owner of the premises let. There
is no need to apply by analogy the provisions of Article 448 on indemnity as was done in
Pecson vs. Court of Appeals, because the situation sought to be avoided and which would
justify the application of that provision, is not present in this case. Suffice it to say, "a
state of forced co-ownership" would not be created between the petitioners and the
private respondents. For, as correctly pointed out by the petitioners, the right of the
private respondents as lessees is governed by Article 1678 of the Civil Code which
allows reimbursement to the extent of one-half of the value of the useful improvements.
It must be stressed, however, that the right to indemnity under Article 1678 of the Civil
Code arises only if the lessor opts to appropriate the improvements. Since the petitioners
refused to exercise that option the private respondents cannot compel them to reimburse
the one-half value of the house and improvements. Neither can they retain the premises
until reimbursement is made. The private respondents' sole right then is to remove the
improvements without causing any more impairment upon the property leased than is
necessary.
Pershing Tan Queto v. Court of Appeals
G.R. No. L-35648, March 27, 1987, 148 SCRA 54
Paras, J.
to its 1919 bed and in the process, cut across the lands of Maria Melad, Timoteo Melad,
and the spouses Pablo Binayug and Geronima Ubina whose lands were transferred on the
eastern, or Tuguegarao, side of the river. To cultivate those lots they had to cross the
river. In April 1969, while the Melads, Binayug, Urbina and their tenants were planting
corn on their lots located on the easter side of Cagayan River, Agustin, the heirs of
Baldomero Langcay, Juan Langcay, and Arturo Balisi, accompanied by the mayor and
some policemen of Tuguegarao, claimed the same lands as their own and drove away the
Melads, Binayug and Urbina from the premises.
ISSUE: Whether or not ownership of accretion is lost upon sudden and abrupt change of
the river.
HELD: No. The ownership of the accretion to the lands was not lost upon sudden and
abrupt change of the course of the river (Cagayan River in 1968 or 1969 when it reverted
to its old 1919 bed), and separated or transferred said accretions to the other side (eastern
bank) of the river. Articles 459 and 463 of the New Civil Code apply to this situation.
Article 459 provides that whenever the current of a river, creek or torrent segregates
from an estate on its bank a known portion of land and transfer it to another estate, the
owner of the land to which the segregated portion belonged retains the ownership of it,
provided that he removes the same within two years. Article 463 provides that,
whenever the current of a river divides itself into branches, leaving a piece of land or part
thereof isolated, the owner of the land retains his ownership. He also retains it if a
portion of land is separated from the estate by the current.
Cureg v. Intermediate Appellate Court
G.R. No. 73465, September 7, 1989, 177 SCRA 313
Medialdea, J.
FACTS: On November 5, 1982, private respondents Domingo Apostol et al. filed a
complaint for quieting of title against petitioners Leonida Cureg et al. The complaint
alleged that private respondents, except Apostol, are the legal and/or the forced heirs of
the late Domingo Gerardo, and his predecessors-in-interest have been in actual, open,
peaceful and continuous possession, under a bona fide claim of ownership of a parcel of
land (referred to as their motherland). Subsequently, the heirs verbally sold the
motherland to Apostol. The motherland showed signs of accretion caused by the
movement of the Cagayan River. When private respondents were about to cultivate their
motherland together with its accretion, they were prevented by the petitioners.
Petitioners alleged that the motherland claimed by the private respondents is nonexistent, that the subject land is an accretion to their registered land, and that
petitioners have been in possession and cultivation of the accretion for many years
now.
ISSUE: Whether or not the petitioners have the better right of accretion.
HELD: Yes. The petitioners are entitled to the accretion. The subject land is an alluvial
deposit left by the northward movement of the Cagayan River and pursuant to Article
457 of the New Civil Code: To the owners of land adjoining the banks of river belong
the accretion which they gradually receive from the effects of the current of the waters.
However, the increase in the area of the petitioners land, being an accretion left by the
change of course or the northward movement of the Cagayan River does not
automatically become registered land just because the lot which receives such accretion
is covered by a Torrens title. As such, it must also be placed under the operation of the
Torrens system.