#1 Berkenkotter vs.

Cu Unjieng

G.R. No. 41643, July 31, 1935

Plaintiff-appellant: B.H. Berkenkotter

Defendant-appellees: Cu Unjieng e Hijos, Yek Tong Lin Fire and Marine Insurance Company, Mabalacat Sugar
Company, and the Provincial Sheriff of Pampanga

Facts:

On April 26, 1926, the Mabalacat Sugar Co., Inc. (MSCI), owner of the sugar central situated in Mabalacat,
Pampanga, obtained from the defendants, Cu Unjieng e Hijos (CUH), a loan secured by a first mortgage constituted
on two parcels of land "with all its buildings, improvements, sugar-cane mill, steel railway, telephone line,
apparatus, utensils and whatever forms part or is a necessary complement of said sugar-cane mill, steel railway,
telephone line, now existing or that may in the future exist in said lots."

On October 5, 1926, shortly after said mortgage had been constituted, MSCI decided to increase the
capacity of its sugar central by buying additional machinery and equipment, so that instead of milling 150 tons
daily, it could produce 250. The estimated cost of said additional machinery and equipment was approximately
P100,000. In order to carry out this plan, B. A. Green, MSCI president, proposed to the plaintiff, B. H. Berkenkotter
(BHB), to advance the necessary amount for the purchase of said machinery and equipment. Green promised to
reimburse BHB as soon as he could obtain an additional loan from the mortgagees, (CUH). Having agreed to said
proposition made on October 5, 1926 (Exhibit E), BHB delivered the sum of P1,710 to MSCI President Green, on
October 9, the total amount supplied by him to Green having been P25,750. Furthermore, BHB had a credit of
P22,000 against MSCI for unpaid salary. With the loan of P25,750 and said credit of P22,000, the MSCI purchased
the additional machinery and equipment now in litigation.

On June 10, 1927, MSCI President Green applied to CUH for an additional loan of P75,000 offering as
security the additional machinery and equipment installed in the sugar central after the execution of the original
mortgage deed, on April 27, 1927, together with whatever additional equipment acquired with said loan. Green
failed to obtain said loan.

The appellant BHB contends that the installation of the machinery and equipment in the sugar central of
MSCI was not permanent in character inasmuch as Green made it appear in the letter, Exhibit E. In case Green
should fail to obtain an additional loan from the defendants CUH, said machinery and equipment would become
security therefor, binding Green not to mortgage nor encumber them to anybody until BHB be fully reimbursed for
the MSCI's indebtedness to him.

Issue:

Whether or not the lower court erred in declaring that the additional machinery and equipment, as improvement
incorporated with the central are subject to the mortgage deed executed in favor of the defendants Cu Unjieng e
Hijos.
Holding:

No. The additional machinery and equipment are included in the first mortgage.

If the installation of the machinery and equipment in question in the central of the Mabalacat Sugar Co.,
Inc., in lieu of. the other of less capacity existing therein, for its sugar industry, converted them into real property
by reason of their purpose, it cannot be said that their incorporation therewith was not permanent in character
because, as essential and principal elements of a sugar central, without them the sugar central would be unable to
function or carry on the industrial purpose for which it was established. Inasmuch as the central is permanent in
character, the necessary machinery and equipment installed for carrying on the sugar industry for which it has
been established must necessarily be permanent.

Furthermore, the fact that B. A. Green bound himself to the plaintiff B. H. Berkenkotter to hold said
machinery and equipment as security for the payment of the latter's credit and to refrain from mortgaging or
otherwise encumbering them until Berkenkotter has been fully reimbursed therefor, is not incompatible with the
permanent character of the incorporation of said machinery and equipment with the sugar central of the
Mabalacat Sugar Co., Inc., as nothing could prevent B. A. Green from giving them as security at least under a
second mortgage.

For the foregoing considerations, we are of the opinion and so hold: (1) That the installation of a
machinery and equipment in a mortgaged sugar central, in lieu of another of less capacity, for the purpose of
carrying out the industrial functions of the latter and increasing production, constitutes a permanent improvement
on said sugar central and subjects said machinery and equipment to the mortgage constituted thereon (article
1877, Civil Code), provided as follows:

"ART. 1877. A mortgage includes all natural accessions, improvements, growing fruits, and rents not collected
when the obligation falls due, and the amount of any indemnities paid or due the owner by the insurers of the
mortgaged property or by virtue of the exercise of the power of eminent domain, with the declarations,
amplifications, and limitations established by law, whether the estate continues in the possession of the person
who mortgaged it or whether it passes into the hands of a third person."

#2 Tumalad v Vicencio

21 SCRA 143

Immovable/Movable

Facts:

Some time in 1955, Alberta Vicencio and Emiliano Simeon loaned 4,800 pesos from Gavino and Generosa
Tumalad. As guarantee, they executed a chattel mortgage over their house in Quiapo which, at that time, was
being rented from Madrigal and Company, Inc.
 The mortgage was registered in the Registry of Deeds of Manila. It was also agreed that default in the
payment of any of the amortizations will make the unpaid balance immediately due and demandable.

The defendants-appellants thus defaulted in paying and the mortgage was extrajudicially foreclosed. The
house was auctioned and bought by the Tumalad’s as the highest bidder.

They then commenced an ejectment case in the MTC which ruled in favor of Tumalad. The defendants-
appellants then appealed to the RTC questioning the legality of the chattel mortgage.

While pending, the MTC issued a writ of execution but cannot be carried because the house has already
been demolished 10 days before pursuant to an order in another ejectment case against the defendants.

The RTC ruled then in favor of Tumalad and ordered the defendants to pay the rent. This was appealed to
the CA which, in turn, certified the case to the SC as only questions of law are involved.

Defendants-appellants contend that the chattel mortgage was void because the subject matter is a house
of strong materials and being an immovable, it can only be the subject of a real estate mortgage and not a chattel
mortgage.

Issue: Can defendants claim that the house is an immovable property?

Ruling:

No.

The parties to a contract may, by agreement, treat as personal property that which by nature would be a
real property if it was so expressly and specifically designated. This is based on the principle of estoppel.

A mortgaged house on a rented land was held to be a personal property not only because the deed of
mortgage considered it as such but also because it did not form part of the land.

It is now settled that an object placed on land by one who had only a temporary right to the same does
not become immobilized by attachment.

In the contract, the house was expressly designated as chattel mortgage which provides that: “the
mortgagor voluntarily cedes, sells and transfers by way of chattel mortgage…”

Although there is no specific statement referring to the house as personal property, the defendants-
appellants could only have meant to convey the house as chattel or intended to treat the same as such that they
should not now be allowed to make an inconsistent stand by claiming otherwise.

Moreover, the subject house stood on a rented lot to which defendants-appellants merely had a
temporary right as lessee, and although this cannot in itself alone determine the status of the property, it does so
when combined with other factors to sustain the interpretation of the parties.

The SC, however, reversed the decision appealed from on the ground that the purchaser of the house is
not yet entitled, as a matter of right, to its possession as there is a 1-year period within which the mortgagor may
redeem the property.

The period of redemption had not yet expired when action was instituted in the court of origin. The
original complaint stated no cause of action and was prematurely filed.
 Vicencio though was not made to pay rent since the action was instituted during the period of
redemption therefore Vicencio still had a right to remain in possession of the property.

#3: Navarro vs Pineda

Immovable/Movable

Facts:

On December 14, 1959, defendants-appellants Rufino G. Pineda and his mother Juana Gonzales borrowed
P2,500 from plaintiff-appellee Conrado Navarro, payable within six months. As a security, Rufino executed a
document captioned “Deed of Real Estate and Chattel Mortgages” wherein Juana mortgaged a parcel of land she
owns while Rufino mortgaged his two-storey residential house and one motor truck.

When the debt became due, the defendants failed to pay. The plaintiff gave them an extension of a little
over two weeks but, again, the defendants failed to pay. They were again given another extension, a month, to pay
their due and defendant Rufino, in a document entitled “Promise”, categorically stated that in the remote event he
should fail to make good the obligation on such date, he would no longer ask for another extension, and the
Navarro could proceed to take whatever action he might desire to enforce his rights under the mortgage contract.
In spite of said promise, defendants failed and refused to pay the obligation prompting the plaintiff to file a
complaint for foreclosure of the mortgage and for damages.

The lower court ruled in favor of the plaintiff and ordered the defendants to pay jointly and severally and
within 90 days the principal sum with 12% compounded interest per annum and to deliver immediately to the
provincial sheriff of Tarlac the personal properties mentioned (house and motor truck), immediately after the
lapse of the 90 days, in default of such payment.

The defendant filed an appeal contending that the lower court erred in holding that the deed of real
estate and chattel mortgages appended to the complaint is valid, notwithstanding the fact that the house of the
defendant Rufino Pineda was made the subject of the chattel mortgage, for the reason that it is erected on a land
that belongs to a third person. Defendants-appellants argue that Article 415 of the New Code, in classifying a
house as immovable property, makes no distinction, whether the owner of the land is or not the owner of the
building. Hence, defendants argue, that the house cannot be the subject of a chattel mortgage since only movables
can be subjected to a chattel mortgage. And since only movables can be the subject of a chattel mortgage, the
defendants claim that the mortgage in question, which is the basis of the present action, cannot give rice to an
action for foreclosure, because it is a nullity.

Issue: Whether or not the residential house, subject of the mortgage therein, can be considered a Chattel

Ruling:

Yes, the residential house can be considered a Chattel.

 The Supreme Court noted that for purposes of the application of the Chattel Mortgage Law, under certain
conditions, “a property may have a character different from that imputed to it.” It added that the trial court did
not predicate its decision declaring the deed of the chattel mortgage validly solely on the ground that the house
mortgaged was erected on the land which belonged to a third person, but also and principally on the doctrine of
estoppels, in that “the parties have so expressly agreed” in the mortgaged to consider the house as chattel “for its
smallness and mixed materials of sawali and wood”. It is undeniable that the parties to a contract may, by
agreement, treat as personal property that which by nature would be a real property.

#4 SERGS PRODUCTS, INC., and SERGIO T. GOQUIOLAY v PCI LEASING AND FINANCE, INC.

G.R. No. 137705, August 22, 2000

Immovable/Movable

FACTS:

Sergs products assails the decision of the CA affirming the decision of the RTC QC who issued a Writ of
Replevin for the seizure of the machineries and equipments belonging to Sergs in favour of PCI Leasing and Finance
(PCI hereinafter for brevity).

PCI filed before the RTC QC a complaint for a sum of money with an application for a writ of replevin
which, as already mentioned, was granted. The sheriff started the seizure of the machineries and equipments
causing Sergs to file a motion to enjoin the sheriff from further enforcement of the writ. PCI opposed said motion
by averring that the machineries and equipments are considered personal/movable properties and thus, proper
subjects of a writ of replevin.

ISSUE: Whether or not the machineries purchased and imported by SERGS became real property by virtue of
immobilization.

RULING:

The machineries are personal/movable properties. The relevant provisions to be used for the resolution of
the case are as follows:

Section 3 of Rule 60 of the Rules of Court provides that writs of replevin are issued for the recovery of
personal property only.

SEC. 3. Order. -- Upon the filing of such affidavit and approval of the bond, the court shall issue an order
and the corresponding writ of replevin describing the personal property alleged to be wrongfully detained and
requiring the sheriff forthwith to take such property into his custody.

Article 415 of the New Civil Code enumerates immovable or real property, to wit :

“ART. 415. The following are immovable property:

xxx
 (5) Machinery, receptacles, instruments or implements intended by the owner of the tenement for an
industry or works which may be carried on in a building or on a piece of land, and which tend directly to meet the
needs of the said industry or works; xxx”

In the present case, the machines that were the subjects of the Writ of Seizure were placed by petitioners
in the factory built on their own land. Indisputably, they were essential and principal elements of their chocolate-
making industry. Hence, although each of them was movable or personal property on its own, all of them have
become immobilized by destination because they are essential and principal elements in the industry.[16] In that
sense, petitioners are correct in arguing that the said machines are real, not personal, property pursuant to Article
415 (5) of the Civil Code.

Be that as it may, we disagree with the submission of the petitioners that the said machines are not
proper subjects of the Writ of Seizure.

The Court has held that contracting parties may validly stipulate that a real property be considered as
personal. After agreeing to such stipulation, they are consequently estopped from claiming otherwise.

In the present case, the Lease Agreement executed between Sergs and PCI clearly provides that the
machines in question are to be considered as personal property. Specifically, Section 12.1 of the Agreement reads
as follows:

“12.1 The PROPERTY is, and shall at all times be and remain, personal property notwithstanding that the
PROPERTY or any part thereof may now be, or hereafter become, in any manner affixed or attached to or
embedded in, or permanently resting upon, real property or any building thereon, or attached in any manner to
what is permanent.”

Clearly then, Sergs is estopped from denying the characterization of the subject machines as personal
property. Under the circumstances, they are proper subjects of the Writ of Seizure.
#5 Davao Sawmill Co. vs Castillo

61 PHIL 709

Immovable/Movable

Facts:

The Davao Saw Mill Co., Inc., is the holder of a lumber concession from the Government of the Philippine
Islands. The land upon which the business was conducted belonged to another person. On the land the sawmill
company erected a building which housed the machinery used by it. Some of the implements thus used were
clearly personal property, the conflict concerning machines which were placed and mounted on foundations of
cement. In the contract of lease between the sawmill company and the owner of the land there appeared the
following provision:

“That on the expiration of the period agreed upon, all the improvements and buildings introduced and
erected by the party of the second part shall pass to the exclusive ownership of the party of the first part without
any obligation on its part to pay any amount for said improvements and buildings; also, in the event the party of
the second part should leave or abandon the land leased before the time herein stipulated, the improvements and
buildings shall likewise pass to the ownership of the party of the first part as though the time agreed upon had
expired: Provided, however, That the machineries and accessories are not included in the improvements which will
pass to the party of the first part on the expiration or abandonment of the land leased.”

In another action, wherein the Davao Light & Power Co., Inc., was the plaintiff and the Davao, Saw, Mill
Co., Inc., was the defendant, a judgment was rendered in favor of the plaintiff in that action against the defendant
in that action; a writ of execution issued thereon, and the properties now in question were levied upon as
personalty by the sheriff. Davao Light and Power Co., proceeded to purchase the machinery and other properties
auctioned by the sheriff.

Issue: Whether the subject machineries were considered as personal properties?

Held:

Yes, the subject machineries were considered as personal or movable properties. Article 415, paragraphs
1 and 5, of the Civil Code, is in point. According to the Code, real property consists of — 1. Land, buildings, roads
and constructions of all kinds adhering to the soil; xxx xxx xxx; 5. Machinery, receptacles, instruments or
implements intended by the owner pf the tenement for an industry ot works which may be carried on in a building
or on a piece of land, and which tend directly to meet the needs of the said industry or works.

In the first place, it must again be pointed out that the appellant should have registered its protest before
or at the time of the sale of this property. It must further be pointed out that while not conclusive, the
characterization of the property as chattels by the appellant is indicative of intention and impresses upon the
property the character determined by the parties.

A similar question arose in Puerto Rico, and on appeal being taken to the United States Supreme Court, it
was held that machinery which is movable in its nature only becomes immobilized when placed in a plant by the
owner of the property or plant, but not when so placed by a tenant, a usufructuary, or any person having only a
temporary right, unless such person acted as the agent of the owner.
#6 MONTANO vs. THE INSULAR GOVERNMENT

12 PHIL 572

Public/Private Land

FACTS:

Montano filed a petition to the Court of Land Registration for the inscription of a piece of land in the
barrio of Libis, municipality of Caloocan, used as a fishery having a superficial area of 10,805 square meters, and
bounded as set out in the petition. This petition was opposed by the Solicitor-General in behalf of the Director of
Lands, and by the entity known as Obras Pias de la Sagrada Mitra, the former on the ground that the land in
question belonged to the Government of the United States, and the latter, that it was the absolute owner of all the
dry land along the eastern boundary of the said fishery.

The Court of Land Registration in its decision of December 1, 1906, dismissed the said oppositions without
costs and decreed, after a general entry by default, the adjudication and registration of the property described in
the petition, in favor of Isabelo Montano. From this decision only counsel for the Director of Public Lands appealed
to this court and precisely Montano sought title thereon on the strength of 10 years' occupation pursuant to
paragraph 6, section 5 of Act 926 of the Philippine Commission.

ISSUE: Whether or not the land in question can be acquired by petitioner Montano.

HELD:

YES. Accordingly, "government land" and "public domain" are not synonymous items. The first includes
not only the second, but also other lands of the Government already reserved or devoted to public use or subject
to private right. In other words, the Government owns real estate which is part of the "public lands" and other real
estate which is not part thereof. Government property was of two kinds — first, that of public use or service, said
to be of public ownership, and second, that of having a private character or use. (Civil Code, arts. 339 and 340.)
Lands of the first class, while they retain their public character are inalienable. Those of the second are not.
Therefore, there is much real property belonging to the Government which is not affected by statutes for the
settlement, prescription or sale of public lands. Examples in point are properties occupied by public buildings or
devoted to municipal or other governmental uses.

It is settled that the general legislation of Congress in respect to public lands does not extend to tide
lands. It provided that the scrip might be located on the unoccupied and unappropriated public lands. As said in
Newhall vs. Sanger (92 U.S. 761, 763.) A marshland which is inundated by the rise of tides belong to the State and
is not susceptible to appropriation by occupation, has no application in the present case inasmuch as in said case
the land subject matter of the litigation was not yet titled.

#7 Laurel v Garcia

GR No 92013 - July 25, 1990

Public/Private Land

Facts:

This is a petition for prohibition seeking to enjoin respondents, their representatives and agents from
proceeding with the bidding for the sale of the 3179 sq m of land of the Roppongi property. This property is one of
the four properties in Japan acquired by the Philippine government under the Reparations Agreement entered into
with Japan, the other lots being – the Nampeidai property, Kobe Commercial property and Kobe Residential
property. These properties procured from the Japanese government for national development projects are part of
the indemnification to the Filipino people for their losses in life and property and their suffering during WWII.

The Roppongi property was acquired from the Japanese government under the heading “Government
Sector”. It became the site of the Philippine Embassy until the latter was transferred to Nampeidai when the
building needed major repairs. Due to the failure of our government to provide necessary funds, the Roponggi
property has remained undeveloped.

A proposal was presented to Pres. Corazon Aquino to make the property the subject of a lease agreement
with a Japanese firm. The government, however, has not acted favorably on this proposal, and instead, the
President, after creating a committee to study the disposition/utilization of these Philippine government
properties in Japan, issued an executive order entitling non-Filipino citizes to avail of the properties in the event of
sale, lease or disposition. Amidst opposition by various sectors, the Executive branch of the government has been
pushing with great vigor its decision to sell the reparations properties starting with Roppongi lot.

Petitioner Laurel, the Vice President, questioned the authority and jurisdiction of the Chief Executive, her
officer and agents in selling the Roponggi lot. He asserted that the Roppongi property and the related lots were
acquired as part of the government reparations from the Japanese government, thus, are classified as one of
public dominion, and not of private ownership.

Issue: WON, the Roppongi lot is one of a public property

Ruling:

The nature of the Roppongi lot as property for public service is expressly spelled out. It is dictated by the
terms of the Reparations Agreement and the corresponding contract of procurement which bind both the
Philippine and Japanese governments.

There can be no doubt that it is of public dominion unless it is convincingly shown that the property has
become patrimonial. This, the respondents have failed to do.

As property of public dominion, the Roppongi loti s outside the commerce of man. It cannot be alienated.
Its ownership i sas special collective ownership for general use and enjoyment, an application to the satisfaction of
collective needs, and resides in the social group. The purpose is not to serve the State as a juridical person, but the
citizens; it is intended for the common and public welfare and cannot be the object of appropriation.

The applicable provisions of the Civil Code are:

ART 419. Property is either of public dominion or private ownership.

ART 420. The following things are property of public dominion: (1) Those intended for public use such as roads,
canals, rivers, torrents, ports and bridges constructed by the State, banks shores roadsteads, and others of similar
character; (2) Those which belong to the State, without being for public use, and are intended for some public
service or for the development of national wealth.

ART 421. All other property of the State, which is not of the character stated in the preceding article, is patrimonial
property.

The Roppongi property is correctly classified under par 2 of Art 420 of the Civil Code as property belonging
to the State and intended for some public service. The fact that the subject property has not been used for a long
time for actual Embassy service does not automatically converti t to patrimonial property. Any such conversion
happens only if the property is withdrawn from public use. A property continues to be part of the public domain,
not available for private appropriation or ownership until there is a formal declaration on the part of the
government to withdraw it from being such.

Even assuming, for the sake of argument, that the Roppongi property is no longer of public dominion,
there is no law authorizing its conveyance. It is not for the President to convey valuable real property of the
government on his or her own sole will. Any such conveyance must be authorized and approved by a law enacted
by the Congress. It requires executive and legislative concurrence.

The petitioner stated why the Roppongi property should not be sold:

The Roppongi property is not just like any piece of property. It was given to the Filipino people in
reparation for the lives and blood of Filipinos who died and suffered during the Japanese military occupation, for
the suffering of widows and orphans who lost their loved ones and kindred, for the homes and other properties lost
by countless Filipinos during the war. The Tokyo properties are a monument to the bravery and sacrifice of the
Filipino people in the face of an invader; like the monuments of Rizal, Quezon, and other Filipino heroes, we do not
expect economic or financial benefits from them. But who would think of selling these monuments? Filipino honor
and national dignity dictate that we keep our properties in Japan as memorials to the countless Filipinos who died
and suffered. Even if we should become paupers we should not think of selling them. For it would be as if we sold
the lives and blood and tears of our countrymen.
#8 Geminiano vs. Court of Appeals

GR 120303

Art 448/Builder in Good Faith

FACTS:

The lot in question was originally owned by the mother of the petitioner. Petitioner sold their unfinished
bungalow to the respondents for P6,000, with a promise to sell the lot to the latter. The property was later leased
to the respondents for 7 years starting November 1978 for P40 a month as evidenced by their written lease
contract. The respondents built their house and introduced some improvements in the lot. In 1985 petitioner’s
mother refused receiving monthly rentals. It turned out that the lot in question was subject to litigation which
resulted to its acquisition by Maria Lee which was sold to Salcedo, who further sold to Dionisio spouses. The
property eventually came back to the petitioner when the Dinisio spouses executed a Deed of Quitclaim over the
said property in favor of the petitioners. As such, the lot was registered in the latter’s names. (petitioners never
lost possession of the land because Lee and company never issued a writ of possession against them).

In 1993, petitioners wrote a letter to respondents demanding them to vacate the premises and when the
latter refused, petitioners filed in court. Respondents claim that they should be entitled to buy the land because of
the promise of the petitioners to sell them the land and because they were builders in Good faith. The courts now
are deciding which one to use: Art. 448 regarding builders and land owners in good faith or Art. 1678 regarding
lessee in good faith who can be reimbursed half of the expenses of the improvements if the LO chooses to
appropriate them and that such lessee have the right to retain in the premises until fully

ISSUES:

1) Whether or not the respondents were builders in Good faith?

2) Whether Art 448 or 1678 should be applied?

HELD:

Private respondents cannot be considered as possessors nor builders in good faith.—Being mere lessees,
the private respondents knew that their occupation of the premises would continue only for the life of the lease.
Plainly, they cannot be considered as possessors nor builders in good faith.

Article 448 of the Civil Code in relation to Article 546 of the same Code which allows full reimbursement
of useful improvements and retention of the premises until reimbursement is made applies only to a possessor in
good faith.—In a plethora of cases, this Court has held that Article 448 of the Civil Code, in relation to Article 546 of
the same Code, which allows full reimbursement of useful improvements and retention of the premises until
reimbursement is made, applies only to a possessor in good faith,i.e., one who builds on land with the belief that
he is the owner thereof. It does not apply where one’s only interest is that of a lessee under a rental contract;
otherwise, it would always be in the power of the tenant to “improve” his landlord out of his property.
 The right to indemnity under Article 1678 of the Civil Code arises only if the lessor opts to appropriate the
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.
#9 Mendoza vs. de Guzman

G.R. No. 28721. October 5, 1928

Plaintiff-appelles: Martin Mendoza and Natalio Enriquez

Defendant-appellant: Manuel de Guzman

Intervenor-appellant: Max B. Solis

Facts:

On November 6, 1916, Leandra Solis and her husband Bernardo Solis brought an action against Martin
Mendoza for the recovery of a certain piece of land. Judgment was rendered in that case absolving Mendoza from
the complaint, then subsequently affirmed by the Supreme Court. When the case was remanded to the court of
origin, the trial judge issued an order dissolving the preliminary writ of injunction and to put Mendoza in the
possession of the land.

In the decision rendered in the cadastral case, the lot in question was adjudicated in favor of Martin
Mendoza and Natalio Enriquez in equal parts pro indiviso, subject to the right of retention on the part of Manuel
de Guzman until he shall have been indemnified for the improvements existing on the land. By virtue of this
judgment, De Guzman presented a motion requesting the issuance of a writ of possession for the lot in his favor,
which was granted on June 25, 1924. From the time the Spouses Solis, as well as Manuel de Guzman who was
working on the land, were ejected therefrom, Mendoza possessed it until June 25, 1924, when De Guzman
obtained the writ of possession abovementioned. Since then De Guzman has had dominion over the land.

Being unable to come to an agreement as to the amount which should be allowed for the improvements
made on the land, Martin Mendoza and Natalio Enriquez began an action requesting the court to (a) fix the value
of the necessary and useful expenses incurred by Manuel de Guzman in introducing the improvements; (b) require
the defendant to render an accounting of the fruits received by him and order that the value of the fruits be
applied to the payment of the necessary and useful expenses; and (c) decree the restitution of the possession to
the plaintiffs. To the complaint, the defendant filed an answer in the form of a general denial with special defenses
and appended a counterclaim and crosscomplaint, in which a total of P6,000 was asked. During the pendency of
the case, Bernardo Solis, or Max. B. Solis, one of the persons who was ejected from the land, asked leave to
intervene, alleging, among other things, that De Guzman, in consideration of the sum of P5,000, had transferred all
his rights in the improvements and in the lot to him with the exception of two hundred coconut trees. This petition
was granted by the trial court.

The CFI held (1) that in accordance with the provisions of articles 435 and 454 in relation with article 361
of the Civil Code, the value of the "indeminization" to be paid to the defendant should be fixed according to the
necessary and useful expenses incurred by him in introducing "las plantaciones en cuestion"; (2) tha tthe plaintiffs
as the owner of the property have the right to make their own "las plantaciones hechas por el demandado: upon
payment in the form indicated in No. 1, the defendant having the right to retain the land until the expenditures
have been refunded; (3) that the defendant is obliged to render a detail and just account of the fruits and other
profits received by him from the property for their due application; and (4) tha the value of the fruits received by
the defendant should first be applied to the payment of the "indemnizacion," and in that it exceeds the value of
the "indemnizacion," the excess shall be returned to the plaintiffs.
 September 23, 1927, the amount that the plaintiffs were required to pay to the respondents exceeded
the amount that the latter were to pay the former, the defendant and intervenor were ordered to deliver the land
and its improvement as soon as the plaintiffs have paid the difference, without special pronouncement as to costs.

Issue:

Whether or not the defendant has the right to be paid by the plaintiffs in whole or in part for the value of
the fruits received by Martin Mendoza and Natalio Enriquez from the respective dates that they were in
possession and enjoyment of the land until June 25, 1924.

Holding:

Yes. The defendant has the right to be paid by the plaintiffs for the value of the fruits from the respective
dates that they were in possession and enjoyment of the land.

The Court goes into the discussion of what is necessary expenses. As described by Spanish commentators,
necessary expenses are those made for the preservation of the thing; as those without which the thing would
deteriorate or be lost; as those that augment the income of the things upon which they are expanded. Among the
necessary expenditures are those incurred for cultivation, production, upkeep, etc.

The court resolved the issue which held that once the owner elects to appropriate the improvements, the
builder, planter, or sower cannot exactly be considered a possessor in good faith. Hence, whatever fruits he
receives during the pendency of retention must be deducted from whatever indemnity is due to him; and in case it
exceeds the value of the indemnity, the excess shall be returned to the owner of the land.

#10 Vda de Nazareno vs CA

Public/Private Land

Facts:

Sometime in 1979, private respondents Jose Salasalan and Leo Rabaya leased a parcel of land situated in
Telegrapo, Puntod, Cagayan de Oro City on which their houses stood from Antonio Nazareno, petitioners’
predecessor-in-interest. Said land was formed as a result of sawdust dumped into the dried-up Balacanas Creek
and along the banks of Cagayan River.

In the latter part of 1982, private respondents allegedly stopped paying rentals. As a result, Antonio
Nazareno and the petitioners filed an ejectment case against the private respondents. The Municipal Trial Court
ruled in favor of the Nazarenos. Such ruling was affirmed by the RTC.
 Now, before he died, Antonio Nazareno caused the approval by the Bureau of Lands of a survey plan with
a view to perfecting his title over the accretion area being claimed by him. However, before the approved survey
plan could be released to the applicant, it was protested by private respondents before the Bueau of Lands.

Land Investigator Avelino Labis conducted an investigation and there after recommended that said survey plan in
the name of Antonio Nazareno be cancelled and that private respondents be directed to file appropriate public
land applications.

Eventually, respondent Director of Lands Abelardo Palad ordered Nazareno to vacate the portions
adjudicated to private respondents and remove whatever improvements they have introduced thereon. He also
ordered that private respondents be placed in possession thereof.

Nazareno filed a Motion for Reconsideration which was subsequently denied. Petitioners then filed a case
before the RTC. It was dismissed. On appeal, the CA upheld the RTC’s decision, hence, this petition.

Issue: Whether or not the subject land is a private land and whether or not respondent Director of Lands acted
within its jurisdiction

Ruling:

The subject land is a public land.

Petitioners claim that the subject land is private land being an accretion to his titled property, applying
Article 457 of the Civil Code which provides:

To the owners of lands adjoining the banks of rivers belong the accretion which they gradually receive
from the effects of the current of the water.

However, they admit that the accretion was formed by dumping of boulders, soil and other filing
materials on portions of the Balacanas Creek and the Cagayan River bounding their land.

As such, petitioners cannot claim the rights of a riparian owner for their submission failed to meet the first
and second requirements of the rules on alluvion which are:

1. That the deposition of soil or sediment be gradual and imperceptible

2. That it be the result of action of the waters of the river (or sea)

3. That the land where accretion takes place is adjacent to the banks of rivers (or the sea coast)

Thus, the Court agrees with the Court of Appeals that the Director of lands acted within his rights when he
issued the assailed execution order, as mandated by Sections 3 and 4 of the Public Land Law which states:

Section 3: The Secretary of Agriculture and Natural Resources shall be the exclusive officer charged with
carrying out the provisions of this Act through the Director of Lands who shall act under his immediate control.

Section 4: Subject to said control, the Director of Lands shall have direct executive control of the survey,
classification, lease, sale, or any other form of concession or disposition and management of lands of the public
domain, and his decisions as to questions of fact shall be conclusive when approved by the Secretary of Agriculture
and Natural Resources.
#11 AGUSTIN V. IAC

GR NO. 6605 JULY 1990

ACCRETION

FACTS:

Private respondents, Maria Melad and Pablo Binuyag are among those who are occupying the western
bank of the Cagayan River while on the eastern bank is owned by petitioner Eulogio Agustin.

From 1919 to 1968, the Cagayan river has eroded the lands on the eastern bank including Agustin’s Lot
depositing alluvium on the land possessed by Pablo Binuyag.

In 1968, after a typhoon which caused a big flood, the Cagayan River changed its course and returned it to
its 1919 bed and it cut through the lands of respondents whose lands were transferred on the eastern side.

To cultivate the lands they had to cross the river. When they were cultivating said lands, (they were
planting corn) Agustin accompanied by the mayor and some policemen claimed the land and drove them away.

So Melad and Binuyag filed separate complaints for recovery of their lots and its accretions.

The Trial Court held ordered Agustin et. al to vacate the lands and return them to respondents.

On appeal, the IAC affirmed in toto the judgment thus the case at bar.

ISSUE: Whether or not private respondents own the accretion and such ownership is not affected by the sudden
and abrupt change in the course of the Cagayan River when it reverted to its old bed?

RULING: Yes.

Art. 457 states that the owner of the lands adjoining river banks own the accretion which they gradually
receive from the effects of the currents of the waters. Accretion benefits a riparian owner provided that these
elements are present: 1) deposit be gradual and imperceptible 2) it resulted from the effects of the current of the
water and 3) the land is adjacent to the riverbank. When the River moved from 1919 to 1968, there was alluvium
deposited and it was gradual and imperceptible.

Accretion benefits the riparian owner because these lands are exposed to floods and other damage due to
the destructive force of the waters, and if by virtue of law they are subject to encumbrances and various kinds of
easements, it is only just that such risks or dangers should in some way be compensated by the right of accretion.

Also, respondent’s ownership over said lots was not removed when due to the sudden and abrupt change
in the course of the river; their accretions were transferred to the other side.

Art. 459 states when the current of a river x x x segregates from an estate on its bank a known portion of
land and transfers it to another estate, the owner of segregated portion retains ownership provided he removes
the same w/in 2 years. And Art. 463 states 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 ownership. He also retains it if a portion of
land is separated from the estate by the current.
#12 GRANDE V CA - ESPANOL

#13 GALA V RODRIGUEZ – ESPANOL

#14 RUSTICO ADILLE vs. CA,

G.R. No. 44546, 29 January 1988

Co-ownership

FACTS:

The land in question Lot 14694 of Cadastral Survey of Albay located in Legaspi City with an area of some
11,325 sq.m. originally belonged to one Felisa Alzul as her own private property; she married twice in her lifetime;
the first, with one Bernabe Adille, with whom she had as an only child, Rustico Adille, petitioner; in her second
marriage with one Procopio Asejo, her children were herein respondents.

Sometime in 1939, said Felisa sold the property in pacto de retro (pacto de retro is when a landowner is in
need of money and basically mortgages his property with an option of buying it back in the future) to certain 3rd
persons, period of repurchase being 3 years, but she died in 1942 without being able to redeem and after her
death, but during the period of redemption, Rustico Adille repurchased, by himself alone, and after that, he
executed a deed of extra-judicial partition representing himself to be the only heir and child of his mother Felisa
with the consequence that he was able to secure title in his name alone also, so that OCT. No. 21137 in the name
of his mother was transferred to his name in 1955.

His half-brothers and sisters--the Asejos, filed for partition with accounting on the position that Adille was
only a trustee on an implied trust when he redeemed and as evidence and it also turned out that one of the
respondents, Emeteria Asejo was occupying a portion of the land in question which Adille also counterclaimed for
her to vacate. Trial Judge sustained defendant in his position that he was and became absolute owner when he
solely redeemed the property and that he was not only a trustee, and therefore, dismissed case and also
condemned Emeteria Asejo to vacate.

The Asejos contended the Trial Court in its decision declaring the defendant absolute owner of the
property; not ordering the partition of the property; and ordering Emeteria who is in possession of the portion of
the property to vacate the land. Court of Appeals reversed the Trial Court’s decision and ruled in favor of the
Asejos, thus, this appeal.

ISSUE: Whether or not the CA erred in reversing the decision of the Trial Court.

HELD:

NO. There was no reversible error committed by the respondent Court of Appeals.
 While the records show that the petitioner redeemed the property in its entirety, shouldering the
expenses therefore, that did not make him the owner of all of it. In other words, it did not put to end the existing
state of co-ownership.

Necessary expenses may be incurred by one co-owner, subject to his right to collect reimbursement from
the remaining co-owners. There is no doubt that redemption of property entails a necessary expense. Art. 488 Civil
Code.

The result is that the property remains to be in a condition of co-ownership. While a vendee a retro,
under Article 1613 of the Code, "may not be compelled to consent to a partial redemption," the redemption by
one co-heir or co-owner of the property in its totality does not vest in him ownership over it. Failure on the part of
all the co-owners to redeem it entitles the vendee a retro to retain the property and consolidate title thereto in his
name. But the provision does not give to the redeeming co-owner the right to the entire property. It does not
provide for a mode of terminating a co-ownership.

Neither does the fact that the petitioner had succeeded in securing title over the parcel in his name
terminate the existing co-ownership. While his half-brothers and sisters are, as we said, liable to him for
reimbursement as and for their shares in redemption expenses, he cannot claim exclusive right to the property
owned in common. Registration of property is not a means of acquiring ownership. It operates as a mere notice of
existing title, that is, if there is one.

#15 Pardell v Bartolome

23 Phil 450

Co-ownership

Facts:

Vicenta Ortiz, one of the plaintiffs, and Matilde Ortiz, one of the defendants were the sole and universal
heirs, and therefore co-owners, of their mother Calixta Felin, with some properties left in Vigan and Candon.

In a complaint filed by the plaintiffs, the latter claimed that they are entitled to the delivery of one-half of
the properties and its rents, fruits and products as these were allegedly taken upon by the defendants themselves
alone during their administration and enjoyment of the subject properties. Specifically, one of the claims of the
plaintiffs pertained on the residence of the defendants to which they shall be paid one-half of the rents which the
upper storey, the residence being of two-storey, would have produced had it been rented to a stranger.

In a counterclaim by the defendants, they denied the allegation of the plaintiffs and even alleged that the
plaintiffs were the ones who owe the defendants, pertaining to some expenses the latter had incurred in the
reconstruction of the same two-storey house co-owned by them, after it was destroyed during an earthquake in
1897.

Issue: WON, (a) defendant Matilde Ortiz, as coowner of the two-storey residential house, was entitled, with her
husband, to reside therein, without paying to her coowner, Vicenta Ortiz, who during the greater part of the time,
lived with her husband abroad, one-half of the rents which the upper storey would have produced had it been
rented to a stranger; (b) plaintiff Vicenta Ortiz should reimburse Matilde Ortiz for the expenses the latter incurred
in reconstructing the co-owned house after it was destroyed by an earthquake

Ruling:

a. Yes, Matilde Ortiz, as a coowner, was entitled to reside without paying to her coowner one-half of the
rents which the upper storey would have produced had it been rented to a stranger.

Article 394 of the Civil Code prescribes:

Each coowner mau use the things owned in common, provided he uses them in accordance with their object
and in such manne ras not to injure the interests of the community nor prevent the coowners from utilizing
them according to their rights.

Matilde and her husband occupied the upper storey, designed for use as a dwelling. But the records show
no proof that by so doing, they have occasioned any detriment to the interest of the community property, nor that
she prevented her sister Vicenta from utilizing the said upper story according to her rights. It is to be noted that
the stores of the lower floor were rented and accounting of the rents was duly made to the plaintiffs.

As the subject property is a pro indiviso property, the coowners Matilde and Vicenta may use and enjoy
the same with no other limitation than that they shall not injure the interests of each other, for the reason that,
until division be made, the respective part of each holder cannot be determined and every one of them may
exercise joint ownership over the property.

Notwithstanding the aforementioned ruling relative to the joint ownership rights which entitled the
defendant to live in the upper story of the said house, her husband, Gaspar, occupied a part of the lower floor as
an office, with strict justice, requires the latter to pay his sister-in-law, the plaintiff, one half of the monthly rent
which the said quarter could have produced had it been rented to a stranger. This is because, even as the husband
of the defendant, he has no right to occupy and use gratuitously the said part of the lower floor of the house
where he lived with his wife.

b. Relative to the payment ought to be claimed by the defendant from the plaintiff as a reimbursement to
the expenses the former incurred in reconstructing the house after it came to ruins due to an earthquake, the
evidences presented were unsuccessfully rebutted and therefore Vicenta should pay Matilde one-half of the
amount of the repair work, deducting the total amount of rent to be paid by the husband of the defendant.
#16 Guillen vs. Court of Appeals

GR 83175

Co-ownership

FACTS:

The petitioners, heirs of Francisco Gosiengfiao (petitioner-heirs), assail in this Rule 45 Petition for Review
on Certiorari the January 17, 2003 decision and September 9, 2003 resolution of the Court of Appeals (CA) in CA-
G.R. CV No. 63093.1 The assailed CA decision ruled that the thirty-day period for the exercise of the right of legal
redemption should be counted, not from the notice of sale by the vendor but, from the finality of the judgment of
this Court.

On G.R. No. 101522 - Mariano v. Court of AppealsThe Court explained that, as the property was
mortgaged by the decedent, co-ownership existed among his heirs during the period given by law to redeem the
foreclosed property. Redemption of the whole property by co-owner Amparo did not vest in her the sole
ownership over the property, as the redemption inured to the benefit of all co-owners; redemption will not put an
end to co-ownership, as it is not a mode of terminating a co-ownership. The Court also distinguished6 between
Articles 10887 and 16208 of the Civil Code and ruled as inapplicable the doctrine that "the giving of a copy of the
deed of sale to the co-heirs as equivalent to a notice."9 On July 12, 1993, this Court denied the respondent-buyers'
motion for reconsideration. The entry of judgment was made on August 2, 1993.

The lower court's orders. (They had earlier filed an Appeal Ad Cautelam which the CA consolidated with
the Petition for Certiorari.)27 As grounds, they cited the lower court's lack of jurisdiction since the motions ruled
upon were really initiatory pleadings based on causes of action independent of, although related to, Civil Case No.
3129, and that no certificate of non-forum shopping was attached, nor any docket fees paid. They also claimed
that the respondent-buyers' motion was a prohibited second motion for reconsideration that the lower court
could not rule upon, and one that was filed beyond the 15-day period of appeal.28 Finally, they faulted the lower
court for ignoring the law of the case, as established in Mariano.

The respondent-buyers questioned the petition on technicalities, but focused on the issue of whether the
final and executory decision of this Court in Mariano was effectively a written notice of sale to the heirs; they
continued to maintain that the redemption period should run from the finality of our Decision, and, thus, had
already lapsed.

ISSUE: Prescription in Co-ownership?

HELD:

Anent the claim of prescription by the petitioners, suffice it to say that the same is untenable in view of
the explicit provisions of the ultimate paragraph of Article 494 of the new Civil Code, which state: No prescription
shall run in favor of a co-owner or co-heir against his co-owners or co-heirs so long as he expressly or impliedly
recognizes the co-ownership.

Co-owners can not acquire by prescription the share of the other co-owners absent a clear repudiation of
the co-ownership which is communicated to the other co-owners. “A mere silent possession by a co-owner, his
receipt of rents, fruits or profits from the property, the erection of buildings and fences and the planting of trees
thereon; and the payment of land taxes, can not serve as proof of exclusive ownership, if it is not borne out by
clear, complete and conclusive evidence that he exercised acts of possession which unequivocally constituted an
ouster or deprivation of the rights of the other co-owners.” On this score, the petitioners have not only failed to
show any definite proof indicating effective repudiation of the co-ownership over the property; on the contrary,
petitioner Leona Santiago-Guillen even affixed her signature on the deed of extra-judicial partition and agreement
of subdivision dated June 26, 1981. By this act, Leona unequivocably affirmed her recognition of the existing co-
ownership.

Presumption of good faith and regularity in the execution of contracts and agreements.—Finally, Leona’s
pretense that her signature in the deed of extra-judicial partition and agreement of subdivision was obtained by
force and intimidation fails to impress us. As correctly observed by the respondent appellate court, being the
youngest of the brood does not prove the presence of duress or intimidation. More important, good faith and
regularity are always presumed in the execution of contracts and agreements. The burden of proving otherwise
falls on the party claiming it, in this instance, the petitioners. Considering that the petitioners had failed to present
any proof beyond their naked assertion, the presumption stands.

#17 De Garcia vs. CA

G.R. No. L-20264, January 30, 1971

Defendants-Petitioners: Consulo S. de Garcia and Anastacio Garcia

Plaintiffs-Respondents: Angelina D. Guevara and Juan B. Guevara

Facts:

Private respondent Angelina D. Guevara, assisted by her spouse, Juan B. Guevara, as plaintiffs, was noted
in the decision of respondent Court of Appeals thus: "Plaintiff seeks recovery of 'one (1) lady's diamond ring 18 cts.
white gold mounting, with one (1) 2.05 cts. diamond-solitaire, and four (4) brills 0.10 cts. total weight' which she
bought on October 27, 1947 from R. Rebullida, Inc.” Then came a summary of now respondent Guevara of her
evidence: "Plaintiff’s evidence tends to show that around October 11, 1953 plaintiff while talking to Consuelo S. de
Garcia, owner of La Bulakeña restaurant recognized her ring in the finger of Mrs. Garcia and inquired where she
bought it, which the defendant answered from her comadre. Plaintiff explained that that ring was stolen from her
house in February, 1952. Defendant handed the ring to plaintiff and it fitted her finger. Two or three days later, at
the request of plaintiff, plaintiff, her husband Lt. Col. Juan Guevara, Lt. Cementina of Pasay PD, defendant and her
attorney proceeded to the store of Mr. Rebullida to whom they showed the ring in question. Mr. Rebullida
examined the ring with the aid of high power lens and after consulting the stock card thereon, concluded that it
was the very ring that plaintiff bought from him in 1947. The ring was returned to defendant who despite a written
request therefor failed to deliver the ring to plaintiff. Hence, this case. Later on when the sheriff tried to serve the
writ of seizure (replevin), defendant refused to deliver the ring which had been examined by Mr. Rebullida,
claiming it was lost."

How the defendant, Consuelo S. de Garcia, the present petitioner before us, along with her husband Anastacio
Garcia, sought to meet plaintiff's claim was narrated thus: "On the other hand, defendant denied having made any
admission before plaintiff or Mr. Rebullida or the sheriff. Her evidence tends to show that the ring (Exhibit 1) was
purchased by her from Mrs. Miranda who got it from Miss Angelita Hinahon who in turn got it from the owner,
Aling Petring, who was boarding in her house; that the ring she bought could be similar to, but not the same ring
plaintiff purchased from Mr. Rebullida which was stolen; that according to a pawn-shop owner the big diamond on
Exhibit 1 was before the trial never dismantled. When dismantled, defendant's diamond was found to weigh 2.57
cts."

Plaintiff lost in the lower court. She elevated the matter to respondent Court of Appeals with the
judgment of the lower court being reversed. In light of the finding that the discrepancy as to the weight between
the diamond-solitaire in Exhibit I and the lost diamond was due to defendant having "substituted a diamond-
solitaire of plaintiff with a heavier stone" that the decision was rendered, respondent Court reversed the lower
court and ordering defendant, now petitioner Consuelo S. de Garcia, to return plaintiff's ring or fact value of
Pl,000.00.

Issue:

Whether or not possession of movable property in good faith is equivalent to title and sufficed to defeat
the claims of Guevarra.

Holding:

No. The controlling provision is Article 559 of the Civil Code. It reads thus: "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 of 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." Respondent Angelina D. Guevara,
having been unlawfully deprived of the diamond ring in question, was entitled to recover it from petitioner
Consuelo S. de Garcia who was found in possession of the same. The only exception the law allows is when there is
acquisition in good faith of the possessor at a public sale, in which case the owner cannot obtain its return without
reimbursing the price.

It is thus immediately apparent that there is no merit to the contention that her possession in good faith,
equivalent to title, sufficed to defeat respondent Guevara’s claim. Even on that assumption, the owner can recover
the same once she can show illegal deprivation. Respondent Court of Appeals was so convinced from the evidence
submitted that the owner of the ring in litigation is such respondent. That is a factual determination to which we
must pay heed, instead of proving any alleged departure from legal norms by respondent Court, petitioner would
stress Article 541 of the Civil Code, which provides: ‘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.” She would accord to
it a greater legal significance than that to which under the controlling doctrines it is entitled.

Possession in good faith does not really amount to title for the reason that Art. 1132 of the Code provides
for a period of acquisitive prescription for movables through ‘uninterrupted possession for four years in good
faith’. The title of the possessor in good faith is not that of ownership, but is merely a presumptive title sufficient
to serve as a basis for acquisitive prescription. And it is for the very reason that the title established by the first
clause of Art. 559 is only a presumptive title sufficient to serve as a basis for acquisitive prescription, that the
clause immediately following provides that ‘one who has lost any movable or has been unlawfully deprived
thereof, may recover it from the person in possession of the same.’ Article 559 in fact assumes that possessor is as
yet not the owner; for it is obvious that where the possessor has come to acquire indefeasible title by adverse
possession for the necessary period, no proof of loss or illegal deprivation could avail the former owner of the
chattel. He would no longer be entitled to recover it under any condition.

#18 DIZON V. SUNTAY

47 SCRA 160

POSSESSION

FACTS:

Respondent Lourdes G. Suntay and one Clarita R. Sison entered into a transaction wherein the Suntay’s
three-carat diamond ring, valued at P5,500.00, was delivered to Sison for sale on commission. Upon receiving the
ring, Sison executed and delivered the receipt to Suntay.

After the lapse of a considerable time without Clarita R. Sison having returned to the ring to her, Suntay
made demands on Clarita R. Sison for the return of said jewelry.

Clarita R. Sison, however, could not comply with Suntay’s demands because on June 15, 1962, Melia
Sison, niece of the husband of Clarita R. Sison, evidently in connivance with the latter, pledged the ring with the
petitioner Dominador Dizon's pawnshop for P2,600.00 without Suntay’s knowledge.

When Suntay found out that Clarita R. Sison pledged the ring, she filed a case of estafa against the latter
with the fiscal's office.

Subsequently, Suntay wrote a letter to Dizon on September 22, 1962 asking for the return of her ring
which was pledged with the latter’s pawnshop under its Pawnshop Receipt serial B No. 65606, dated June 15,
1962.

Dizon refused to return the ring, so Suntay filed an action for its recovery with the CFI of Manila, which
declared that she had the right to its possession. The Court of Appeals likewise affirmed said decision.

ISSUE: Who has the right title over the subject property?

RULING:

One who has lost or has been unlawfully deprived of a movable may recover the same from the person in
possession of the same and the only defense the latter may have is if he has acquired it in good faith at a public
sale in which case the owner cannot obtain its return without reimbursing the price paid therefore. Suntay who
was unlawfully deprived of the ring was entitled to recover it from Dizon who was found in possession of the same.

In the present case, not only has the ownership and the origin of the ring misappropriated been
unquestionably proven but also that Sison has fraudulently and in bad faith, disposed of and pledged them
contrary to agreement, with no ownership, and to the prejudice of Suntay, who was thereby illegally deprived of
said jewels. The owner has the right to recover. He is not estopped when his property has been unlawfully pledged
by another.

The Supreme Court affirmed the decision of the lower courts. The controlling provision is Article 559 of
the Civil Code which provides that “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 of 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.”

The only exception the law allows is when there is acquisition in good faith of the possessor at a public
sale, in which case the owner cannot obtain its return without, reimbursing the price. Hanging on to said exception
as his basis, Dizon insisted that the principle of estoppel should apply in this case but the Supreme Court ruled
otherwise.

In the present case not only has the ownership and the origin of the jewels misappropriated been
unquestionably proven but also that Clarita R. Sison, acting fraudulently and in bad faith, disposed of them and
pledged them contrary to agreement with no right of ownership, and to the prejudice of Suntay, who was illegally
deprived of said jewels and who, as the owner, has an absolute right to recover the jewels from the possession of
whosoever holds them, which in this case is Dizon’s pawnshop.

Dizon ought to have been on his guard before accepting the pledge in question, but evidently there was
no such precaution availed of and he has no one to blame but himself. While the activity he is engaged in is no
doubt legal, it is not to be lost sight of that it thrives on taking advantage of the necessities precisely of that
element of our population whose lives are blighted by extreme poverty. From whatever angle the question is
viewed then, estoppel certainly cannot be justly invoked.

#19 EDCA vs Spouses Santos

Possession

Facts:

A person identifying himself as Professor Jose Cruz placed an order by telephone with the petitioner
company for 406 books, payable on delivery. EDCA prepared the corresponding invoice and delivered the books as
ordered, for which Cruz issued a personal check covering the purchase price of P8,995.65. Cruz sold 120 of the
books to private respondent Leonor Santos who, after verifying the seller's ownership from the invoice he showed
her, paid him P1,700.00.

Meanwhile, EDCA having become suspicious over a second order placed by Cruz even before clearing of
his first check, made inquiries with the De la Salle College where he had claimed to be a dean and was informed
that there was no such person in its employ. Further verification revealed that Cruz had no more account or
deposit with the Philippine Amanah Bank, against which he had drawn the payment check. EDCA then went to the
police, which set a trap and arrested Cruz. Investigation disclosed his real name as Tomas de la Peña and his sale of
120 of the books he had ordered from EDCA to the private respondents.

On the night of the same date, EDCA sought the assistance of the police, which forced their way into the
store of the private respondents and threatened Leonor Santos with prosecution for buying stolen property. They
seized the 120 books without warrant, loading them in a van belonging to EDCA, and thereafter turned them over
to the petitioner.

Private respondents sued for recovery of the books after demand for their return was rejected by EDCA.
The Municipal Trial Court recognized respondents’ ownership of the books. The Regional Trial Court sustained
MTC’s decision, which in turn sustained by the Court of Appeals, hence, this petition.

Issue/s:

1. Whether or not private respondents have established ownership over the disputed books

2. Whether or not petitioner have been unlawfully deprived of the books

Ruling:

1. Yes, private respondents have established ownership over the disputed books.

ARTICLE 1477 of the Civil Code states that: “the ownership of the thing sold shall be transferred to the
vendee upon the actual or constructive delivery thereof.” Actual delivery of the books having been made, Cruz
acquired ownership over the books which he could then validly transfer to the private respondents. The fact that
he had not yet paid for them to EDCA was a matter between him and EDCA and did not impair the title acquired by
the private respondents to the books.

2. The petitioner argues that it was unlawfully deprived of the books because the impostor acquired no title
to the books that he could have validly transferred to the private respondents. Its reason is that as the payment
check bounced for lack of funds, there was a failure of consideration that nullified the contract of sale between it
and Cruz. However, ARTICLE 1475 of the Civil Code provides that: “The contract of sale is perfected at the moment
there is a meeting of minds upon the thing which is the object of the contract and upon the price”, and ARTICLE
1478 states that: “The parties may stipulate that ownership in the thing shall not pass to the purchaser until he has
fully paid the price.”

It is clear from the above provisions, particularly the last one quoted, that ownership in the thing sold
shall not pass to the buyer until full payment of the purchase only if there is a stipulation to that effect. Otherwise,
the rule is that such ownership shall pass from the vendor to the vendee upon the actual or constructive delivery
of the thing sold even if the purchase price has not yet been paid.

Non-payment only creates a right to demand payment or to rescind the contract, or to criminal
prosecution in case of bouncing checks. But absent the stipulation above noted, delivery of the thing sold will
effectively transfer ownership to the buyer who can in turn transfer it to another.

Hence, petitioner’s contention has no leg to the stand on.

#20 DOMINADOR DIZON, doing business under the firm name "Pawnshop of Dominador Dizon" v LOURDES G.
SUNTAY

G.R. No. L30817, September 29, 1972

Possession
FACTS:

The item under issue is a diamond ring belonging to Lourdes which she delivered to Clarita Sison to sell it
on commission. However, Clarita’s husband’s niece, Melia Sison, in connivance with Clarita, pledged said diamond
ring to the pawnshop of Dominador Dizon.

Hence, Lourdes sought for the recovery of her diamond ring through a demand from Dominador who
refused to return the same. Consequently, Lourdes filed an action for replevin before the CFI. The CFI granted her
prayer, issued and executed the writ of replevin thereby returning possession of the diamond ring to her. Upon
appeal by Dominador, the CA affirmed CFI’s decision.

Hence, the instant petition.

ISSUE: Whether or not Lourdes is entitled for recovery of diamond ring?

RULING:

Yes, Lourdes is entitled for the recovery of the diamond ring anchored on the following New Civil Code
provision:

“Article 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 of 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.” (Underscoring supplied)

Hence, since Lourdes was deprived of the possession of the diamond ring through the violation of the
terms of the contract of agency entered into between her and Clarita, she is given by law the right to recover
possession of the same.
#21 CHUA KAI V. KAPUNAN

104 PHIL 110

Possession

Facts:

Soto purchased from Youngstown Hardware 700 galvanized iron sheets and round iron bars. He issued as
payment a check drawn against Security Bank. Soto then sold the sheets, some of them to Chua Hai. Meanwhile,
the check issued for payment was dishonored due to insufficiency of funds. This prompted the hardware store to
file a case of estafa against Soto and prayed for the return of the sheets. This was opposed by Chua on the part of
the sheets he purchased. Notwithstanding this opposition, the court ordered for its return.

Issue:

Whether Chua Hai be entitled as if he was the true owner of the galvanized iron sheets?

Held:

Yes, the Supreme Court held that the acquirer and possessor 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. To deprive Chua, who was in good faith, of the possession of the sheets, may it
be temporarily or permanently, is in violation of the rule laid down in Article 559. Possession of chattels in good
faith is equivalent to title, until ordered by the proper court to restore the thing to the owner who was illegally
derpived thereof. Until such decree is issued, the possessor as presumptive owner is entitled to the enjoyment and
holding of the thing. Further, the hardware store or Ong was not unlawfully deprived of the sheets. There was a
perfected contract of sale between it and Soto. There was delivery, by virtue of which, Soto was able to acquire
title over the sheets and bars. The failure of the buyer to pay the purchase price doesn't automatically revest
ownership to the seller until the contract of sale has been first rescinded or resolved. Hence, until the contract
between Soto and Ong has been set aside by the competent court, the validity of Chua’s possession cannot be
disputed and his right to possession thereof should be respected.

#22 VDA. DE ALBAR vs. FABIE,

106 PHIL 855

Usufruct

FACTS:
 Doña Rosario Fabie y Grey was the owner of the lot in the City of Manila with a building and
improvements, and by a will left by her upon her death which was duly probated she devised the naked ownership
of the whole property to Rosario Grey Vda. de Albar, et al. but its usufruct to Josefa Fabie for life.

During liberation, as a consequence of the fire that gutted the building in many portions of Manila, the
building on the Ongpin lot was burned, leaving only the walls and other improvements that were not destroyed by
the fire. One Au Pit, a Chinaman, offered to lease the property for a period of five (5) years, at the same time
agreeing to construct on the lot a new building provided the naked owners as well as the usufructuary sign the
agreement of the lease. As the usufructuary maintains that she has the exclusive right to cede the property by
lease and to receive the full rental value by virtue of her right to usufruct while on the other hand the naked
owners maintain that the right of usufruct was extinguished when the building was destroyed, the right of the
usufructory being limited to the legal interest on the value of the lot and the materials, in order that the
agreement of lease may be affected, the parties agreed on a temporary compromise whereby the naked owners
would receive P100.00, or 20% of the monthly rental of P500.00 and the usufructuary the balance of 80% or
P400.00 of said monthly rental.

It was likewise stipulated in the agreement that the title to the building to be constructed would accrue to
the land upon it completion as an integral part of the lot covered by the transfer certificate of title issued in the
name of the naked owners but subject to the right of usufruct of Josefa Fabie.

ISSUE: Whether or not the usufruct included the building and the land.

HELD:

YES. The usufruct for life extended to the land and the building.

From the above, it is clear that when the deceased constituted the life usufruct on the rentals "fincas
situadas" in Ongpin and Sto. Cristo streets, she meant to impose the encumbrance both the building and the land
on which it is erected for indeed the building cannot exist without the land. And as this Court well said, "The land,
being an indispensable part of the rented premises cannot be considered as having no rental value whatsoever."
Since only the building was destroyed and the usufruct is constituted not only on the building but on the land as
well, then the usufruct is not deemed extinguished by the destruction of the building for under the law usufruct is
extinguished only by the total loss of the thing subject of the encumbrance (Article 603, old Civil Code).

#23 Gaboya v Cui

27 SCRA 85

Usufruct

Facts:

Don Mariano Cui, widower, as owner of lot nos. 2312, 2313 and 2319 sold said three lots to three of his
children named Rosario C. de Encarnacion, Mercedes C. de Ramas and Antonio Ma. Cui. With respect to Rosario’s
part, however, the sale was cancelled due to lack of funds, hence, a third part was returned to the vendor. Don
Mariano Cui and his children Mercedes and Antonio became co-owners of the whole mass in equal portions. In the
deed of sale, vendor Don Mariano retained for himself the usufruct of the property.

Subsequently, a building was erected on a portion of this mass and was occupied by a Chinese
businessman who paid Don Mariano P600 a month as rental. A 12-door commercial building was then built after
Antonio and Mercedes, with Don Mariano’s consent, mortgaged the latter’s share, provided however, that the
rents of the said land shall not be impaired and will always be received by him.

Sometime in 1949, Don Mariano was declared incompetent, thus, the appointment of a guardian of his
property in the name of Victorino Reynes. A complaint was instituted by the guardian based on the allegation that
the usufructuary right reserved in favor of Don Mariano Cui extends to and includes the rentals of the building
constructed by Antonio and Mercedes on the land sold to them by their father; that they retained these rentals to
themselves; that the usufructuary rights of the vendor were the essence of the sale and their violation rescinds the
sale. The complaint’s prayer was either for rescission or for delivery of the rentals of the buildings.

Issue: WON, the usufruct reserved by the vendor in the deed of sale gave the usufructuary the right to receive the
rentals of the commercial building constructed by the vendees

Ruling:

The Court ruled that the rentals included in the usufructuary rights reserved by the vendor over the lots in
dispute were limited to the rentals of the land alone. It was not designed to include also the rents of the buildings
intended to be raised on the land, for there was a lack of an express provision to that effect.

Article 595 of the Civil Code prescribes that –

The owner may construct any works and make any improvements of which the immovable usufruct is
susceptible or make new plantings thereon if it be rural, provided that such acts do not cause a diminution in the
value of the usufruct or prejudice the right of the usufructuary.

The limitations set by Article 595 to the construcion rights of the naked owner of the land are evidently
premised upon the fact that such constructions would necessarily reduce the area of the land under usufruct, for
which the latter should be indemnified.

As for the prayer of rescission, since the rental value of the land has not been fixed either by the parties or
by the court, the default cannot be exclusively blamed upon the defendants, hence, the breach is not “so
substantial and fundamental as to defeat the object of the parties in making the agreement.”
#24 Gargantos vs. Tan Yanon and Court of Appeals

Easement/Servitude

FACTS:

The late Francisco Sanz was the former owner of a parcel of land, with the buildings and improvements
thereon. He subdivided the lot into three and then sold each portion to different persons. One portion was
purchased by Guillermo Tengtio, who subsequently sold it to Vicente Uy Veza. Another portion, with the house of
strong materials thereon, was sold to Tan Yanon, the respondent. This house has on its northeastern side, doors
and windows over-looking the third portion. The said third portion, together with the camarin and small building
thereon, was acquired by Juan Gargantos, the petitioner. Gargantos applied to the Municipal Mayor for a permit to
demolish the roofing of the old camarin . The permit having been granted, Gargantos tore down the roof of the
camarin . Gargantos asked for another permit to construct a combined residential house and warehouse on his lot.
Tan Yanon opposed the approval of this application. Tan Yanon filed against Gargantos an action to restrain the
latter from constructing a building that would prevent plaintiff (Tan Yanon) from receiving light and enjoying the
view through the window of his house, unless such building is erected at a distance of not less than three meters
from the boundary line between the lots of plaintiff and defendant. Court of First Instance rendered judgment in
favor of the defendant. Court of Appeals set aside the decision of the CFI and enjoined defendant from
constructing his building unless "he erects the same at a distance of not less than three meters from the boundary
line of his property, in conformity with Article 673 of the New Civil Code."

ISSUE:

Whether or not the property of respondent Tan Yanon has an easement of light and view against the property of
petitioner Gargantos

HELD:

Yes. Respondent Tan Yanon's property has an easement of light and view against petitioner's property. By
reason of his easement, petitioner cannot construct on his land any building, unless he erects it at a distance of not
less than three meters from the boundary line separating the two estates.

EASEMENT OF LIGHT AND VIEW; TWO ADJOINING ESTATES FORMERLY OWNED BY ONE PERSON; WHEN
EXISTENCE OF DOORS AND WINDOWS IS EQUIVALENT TO A TITLE.—Where two adjoining estates were formerly
owned by just one person who introduced improvements on both such that the wall of the house constructed on
the first estate extends to the wall of the camarin on the second estate; and at the time of the sale of the first
estate, there existed on the aforementioned wall of the house, doors and windows which serve as passages for
light and view, there being no provision in the deed of sale that the easement of light and view will not be
established, the case is covered by Article 624, New Civil Code, which provides that the existence of an apparent
sign of easement between two estates established by the proprietor of both, shall be considered, if one of them is
alienated, as a title so that the easement will continue actively and passively, unless at the time the ownership of
the estate is divided, the contrary is stated in the deed of alienation of either of them, or the sign is made to
disappear before the instrument is executed. The existence of the doors and windows on the aforesaid wall of the
house is equivalent to a title, for the visible and permanent sign of an easement is the title that characterizes its
existence. But while the law declares that the easement is to "continue", the easement actually arises for the first
time only upon alienation of either estate, inasmuch as before that time there is no easement to speak of, there
being but one owner of both estates (Article 613, N.C.C.).
#25 Valdesz vs. Tabisula

G.R. No. 175510. July 28, 2008

Petitioners: Spouses Victor Valdez and Jocelyn Valdez

Respondents: Spouses Francisco Tabisula and Caridad Tabisula

Facts:

Spouses Victor and Jocelyn Valdez purchased from spouses Francisco Tabisula and Caridad Tabisula a
parcel of land. Contained in the deed of sale is a stipulation that the Sps. Valdez ‘shall be provided a 2 1/2 meters
wide road right-of-way on the western side of their lot but which is not included in this sale’. Sps. Tabisula then
built a concrete wall on the subject property. Feeling betrayed by said act of Sps. Tabisula based on the deed of
sale’s intended road right of way, Sps. Valdez reported the matter to the brgy. Lupon but it was in vain which
constrained Sps. Valdez to file a case for specific performance against the Tabisulas with the RTC. The Sps. Tabisula
contended that (1) the Sps. Valdez and family also are the owners of two properties adjoining the subject property,
which adjoining properties have access to two public roads; and (2) they could not have agreed to providing
petitioners an easement “on the western side of their lot” as there exists a two-storey concrete house on their lot
where the supposed easement is to be located, which was erected long before the subject property was sold to
the Valdez’s; thus, the easement should be taken from the western portion of the subject property and not from
theirs.

RTC dismissed the Sps. Valdez’s complain. On appeal, Sps. Valdez were again turned down.

Issue:

Whether or not the Sps. Valdez are entitled to the right of way as provided for in the deed of sale

Holding:

No, the Sps. Valdez are not entitled to the right of way. An easement or servitude is “a real right
constituted on another’s property, corporeal and immovable, by virtue of which the owner of the same has to
abstain from doing or to allow somebody else to do something on his property for the benefit of another thing or
person.” The statutory basis of this right is Article 613 of the Civil Code which reads:

Art. 613. An easement or servitude is an encumbrance imposed upon an immovable for the benefit of another
immovable belonging to a different owner.
 The immovable in favor of which the easement is established is called the dominant estate; that which is
subject thereto, the servient estate. There are two kinds of easements according to source – by law or by the will
of the owners. So Article 619 of the Civil Code provides:

Art. 619. Easements are established either by law or by the will of the owners. The former are called legal and the
latter voluntary easements.

From the allegations in Sps Valdez’ complaint, it is clear that what they seek to enforce is an alleged grant
in the deed by respondents of an easement reading: “they shall be provided a 2 ½ meters wide road right-of-way
on the western side of their lot but which is not included in this sale.”

Article 1358 of the Civil Code provides that any transaction involving the sale or disposition of real
property must be in writing. The stipulation harped upon by petitioners that they “shall be provided a 2 ½ meters
wide road right-of-way on the western side of their lot but which is not included in this sale” is not a disposition of
real property. The proviso that the intended grant of right of way is “not included in this sale” could only mean that
the parties would have to enter into a separate and distinct agreement for the purpose. The use of the word
“shall,” which is imperative or mandatory in its ordinary signification, should be construed as merely permissive
where, as in the case at bar, no public benefit or private right requires it to be given an imperative meaning.

Besides, a document stipulating a voluntary easement must be recorded in the Registry of Property in
order not to prejudice third parties. So Articles 708 and 709 of the Civil Code call for, viz:

Art. 708. The Registry of Property has for its object the inscription or annotation of acts and contracts relating to
the ownership and other rights over immovable property.

Art. 709. The titles of ownership, or of other rights over immovable property, which are not duly inscribed or
annotated in the Registry of Property shall not prejudice third persons. Sps Valdez are neither entitled to a legal or
compulsory easement of right of way.

For to be entitled to such kind of easement, the preconditions under Articles 649 and 650 of the Civil Code
must be established, viz:

Art. 649. The owner, or any person who by virtue of a real right may cultivate or use any immovable, which is
surrounded by other immovables pertaining to other persons, and without adequate outlet to a public highway, is
entitled to demand a right of way through the neighboring estates, after payment of the proper indemnity.

xxxx

This easement is not compulsory if the isolation of the immovable is due to the proprietor’s own acts.
(Underscoring supplied)
Art. 650. The easement of right of way shall be established at the point least prejudicial to the servient estate, and,
insofar as consistent with this rule, where the distance from the dominant estate to a public highway may be the
shortest. (Underscoring supplied)

Thus, to be conferred a legal easement of right of way under Article 649, the following requisites must be
complied with: (1) the property is surrounded by other immovables and has no adequate outlet to a public
highway; (2) proper indemnity must be paid; (3) the isolation is not the result of the owner of the dominant
estate’s own acts; (4) the right of way claimed is at the point least prejudicial to the servient estate; and (5) to the
extent consistent with the foregoing rule, the distance from the dominant estate to a public highway may be the
shortest.

The onus of proving the existence of these prerequisites lies on the owner of the dominant estate, herein
Sps. Valdez. Since the Sps. Valdez then have more than adequate passage to two public roads, they have no right
to demand the grant by the Sps. Tabisula of an easement on the “western side of the Tabisula’s lot.”; it appearing
that the Sps. Valdez and their family are also the owners of two properties adjoining the subject property which
have access to two public roads or highways.
#26 STERNBERG VS SORIANO

41 PHIL 210

EASEMENT/SERVITUDE

FACTS:

Oscar Sternberg owns a parcel of land with a two storey-house which was built in 1905. The said house
has windows overlooking the adjacent lot belonging to Soriano. The windows were built on the wall of the house
which has a 1.36 m. distance from the dividing line between the two lots.

Thereafter, Soriano filed an action to compel Sternberg to close the windows because it is less than 2
meters from thedivision line between the two lots and hence, a violation of Article 582 (now Article 670) of the
Civil Code.

The law provides that "No windows or balconies or other similar projections which directly overlook the
adjoining property may be opened or built without leaving a distance of not less than 2 meters between the wall in
which they are built and such adjoining property.

Sternberg argues that the action of Soriano has already prescribed.

It must be noted that there is no annotation in the Torrens title of the parties involved. (No easement of
view in the title of Soriano and no right to easement on the title of Sternberg.)

Here, there is no question of easement.

ISSUE: WON a right of action to enforce Article 582 of the Civil code may be lost by failure to prosecute within the
prescriptive period fixed by the Code of Civil Procedure.

RULING: Yes.

In this case, Sternberg has never prohibited Soriano from building any wall on his own land. Soriano’s
cause of action only arose in 1905 when Sternberg built the offending edifice (building). Nevertheless, the
windows complained of were permitted to be open for thirteen years (1918) without protest from Soriano.
Soriano must, consequently, by reason of his own laches, be considered to have waived any right which he may
have had to compel the windows to be closed. It is our holding that plaintiff right of action under article 582 of the
Civil Code accrued in 1905 when the windows in defendant's house were opened, and that, in accordance with
Chapter III of the Code of Civil Procedure, his action has prescribed.
#27
#28 REMIGIO O. RAMOS, SR. V GATCHALIAN REALTY, INC., EDUARDO ASPREC, and COURT OF APPEALS

G.R. No. 75905 October 12, 1987

Easment/Servitude

FACTS:

Remigio’s lot’s ingress and egress was barred by the construction of a wall by Gatchalian Realty, a
subdivision developer. Thus, Remigio filed a complaint for an easement of a right of way with preliminary
mandatory injunction before the lower court. The lower court ordered for the granting of a right of way after
payment of indemnity amounting to P5,000. However, upon reorganization of the judiciary, the lower court under
a new judge set aside and ruled that the previous decision was premature since Gatchalian Realty had not
presented their evidence as to the main issue. The lower court under the new judge dismissed the case on the
ground that Remigio failed to supply sufficient evidence to entitle him to a right of way. This decision of the lower
court was affirmed by teh CA on appeal.

Hence, the present petition.

ISSUE:

Whether or not Remigio has all the requisites necessary for him to be granted of an easement of a right of way?

RULING:

No, Remigio is not entitled for an easement of a right of way due to failure to satisfy the preconditions for
the same.

An easement or servitude is an encumbrance imposed upon an immovable for the benefit of another
immovable belonging to a different owner (Article 613 of the New Civil Code) and it may be classified into two: 1)
legal or compulsory easement if it is established by law and 2) voluntary easement if established by the will of the
parties.

Evidently, no agreement for an easement exists between the parties of this case. Hence, the only question
to resolve is whether there could be a legal or compulsory easement to favour Remigio.

The preconditions of a grant of a legal or compulsory easement are as follows: (From jurisprudence.
BacolodMurcia Milling Company, Inc. vs. Capitol Subdivision Inc., et al. (17 SCRA 731, 7356)

(1) That it is surrounded by other immovables and has no adequate outlet to a public highway (Art. 649, par. 1);

(2) After payment of proper indemnity (Art. 649, p. 1);

(3) That the isolation was not due to the Central's own acts (Art. 649, last par.); and

(4) That the right of way claimed is "at the point least prejudicial to the servient estate; and insofar as consistent
with this rule, where the distance from the dominant estate to a public highway may be the shortest." (Art. 650).

Anent the first precondition, the records of the case show that there is another road right of way provided
by the subdivision developer to whom the lot of Remigio belong. The fact that said road is not yet developed and
causes inconvenience to Remigio and his family for being bumpy and muddy during rainy seasons will not bring the
situation under the ambit of the first precondition.

After resolving that the first requisite has not been complied with, the Court found no reason to
determine whether or not the other requisites were satisfied.
#29 VELASCO V. MANILA ELECTRIC

40 SCRA 342

Nuisance

Facts:

On February 12, 1948, respondent Pedro J. Velasco (VELASCO, for short) purchased three (3) lots from the
People's Homesite and Housing Corporation (PHHC, for short), located at the corner of the then South D and South
6 Streets of Quezon City. On January 31, 1952, VELASCO sold two of the aforesaid three lots (the PROPERTY, for
short) to petitioner Manila Electric Company (MERALCO, for short), which is the public service company furnishing
electric current to the Manila area, including Quezon City. The following year, MERALCO established a substation
within the PROPERTY. VELASCO’s family tried to tolerate for a while, but the severe noise without let up, plus the
electrification of the ground, especially that in which the artesian well of the undersigned is located, made life of
the whole family unbearable, in a residential district which, by your sub-station, was illegally converted into
dangerous factory-like site, which prompted them to file a complaint against MERALCO. The trial Court dismissed
the complaint but, on appeal to this Court, the dismissal was set aside.

Issue: Whether MERALCO is guilty of Nuisance?

Held:

Yes. General rule is that everyone is bound to bear the habitual or customary inconveniences that result
from the proximity of others, and so long as this level is not surpassed, he may not complain against them. But if
the prejudice exceeds the inconveniences that such proximity habitually brings, the neighbor who causes such
disturbance is held responsible for the resulting damage, being guilty of causing nuisance.

The test is whether the rights of property, of health or of comfort are so injuriously affected by the noise
in question that the sufferer is subjected to a loss which goes beyond the reasonable limit imposed upon him by
the condition of living, or of holding property, in a particular locality in fact devoted to uses which involve the
emission of noise although ordinary care is taken to confine it within reasonable bounds.
#30 HIDALGO ENTERPRISES, INC., vs. BALANDAN

G.R. No. L-3422, June 13, 1952

Nuisance

FACTS:

It appears that the petitioner Hidalgo Enterprises, Inc. "was the owner of an ice-plant factory in the City of
San Pablo, Laguna, in whose premises were installed two tanks full of water, nine feet deep, for cooling purposes
of its engine. While the factory compound was surrounded with fence, the tanks themselves were not provided
with any kind of fence or top covers. The edges of the tanks were barely a foot high from the surface of the
ground. Through the wide gate entrance, which is continually open, motor vehicles hauling ice and persons buying
said commodity passed, and any one could easily enter the said factory, as he pleased. There was no guard
assigned on the gate. At about noon of April 16, 1948, plaintiff's son, Mario Balandan, a boy barely 8 years old,
while playing with and in company of other boys of his age entered the factory premises through the gate, to take
a bath in one of said tanks; and while thus bathing, Mario sank to the bottom of the tank, only to be fished out
later, already a cadaver, having been died of "asphyxia secondary to drowning."

The Court of Appeals, and the Court of First Instance of Laguna, took the view that the petitioner
maintained an attractive nuisance (the tanks), and neglected to adopt the necessary precautions to avoid accidents
to persons entering its premises.

The Court of Appeals required Hidalgo Enterprises, Inc. to pay Guillermo Balandan and his wife, damages
in the sum of P2,000 for the death of their son Mario. Thus, this appeal.

ISSUE: Whether or not a water tank is an attractive nuisance.

HELD:

The great majority of American decisions say NO. The reason why a water tank or reservoir of water is not
considered an attractive nuisance was lucidly explained by the Indiana Appellate Court as follows:

Nature has created streams, lakes and pools which attract children. Lurking in their waters is always the
danger of drowning. Against this danger children are early instructed so that they are sufficiently presumed to
know the danger; and if the owner of private property creates an artificial pool on his own property, merely
duplicating the work of nature without adding any new danger, . . . (he) is not liable because of having created an
"attractive nuisance." Anderson vs. Reith-Riley Const. Co., N. E., 2nd, 184, 185; 112 Ind. App., 170.

The attractive nuisance doctrine generally is not applicable to bodies of water, artificial as well as natural,
in the absence of some unusual condition or artificial feature other than the mere water and its location.

There are numerous cases in which the attractive nuisance doctrine has not been held not to be
applicable to ponds or reservoirs, pools of water, streams, canals, dams, ditches, culverts, drains, cesspools or
sewer pools, . . . (65 C.J.S., p. 476 et seg. citing decisions of California, Georgia, Idaho, Illinois, Kansas, Iowa,
Louisiana, Miss., Missouri, Montana, Oklahoma, Pennsylvania, Tennessee, Texas, Nebraska, Wisconsin.)
#31 Maglasang v Heirs of Corazon Cabatingan

GR No 131953, June 5, 2002

Donation

Facts:

On Feb 1992, Conchita Cabatingan executed in favor of petitioners deeds of donation. These deeds of
donation contain similar provisions, to wit:

That for and in consideration of the love and affection of the DONOR for the DONEE, xxx the DONOR does
hereby, by these presents, transfer, convey, by way of donation, unto the DONEE the above-described property,
together with the buildings and all improvements existing thereon, to become effective upon the death of the
DONOR; PROVIDED, HOWEVER, that in the event that the DONEE should die before the DONOR, the present
donation shall be deemed automatically rescinded and of no further force and effect; xxx

On May 1995, Conchita Cabatingan died.

Upon learning of the existence of the donations, respondents filed with the RTC an action for annulment
and/or declaration of nullity of the deeds of donations. Respondents alleged, among others, that the documents
are void for failing to comply with the provisions of the Civil Code regarding formalities of wills and testaments,
considering that these are donations mortis causa.

The lower court ruled in favor of the respondents, declaring that the four deeds of donation as null and
void ab inition for being a donation Mortis Causa and for failure to comply with the formal and solemn requisites
under ART 806 of the New Civil Code. Hence, the petition.

Issue: WON, the lower court erred in holding that the deeds of novation are donations mortis causa and not inter
vivos, as contended by the petitioners

Ruling:

The lower court did not err in ruling in favor of the respondents.

In a donation mortis causa, the right of the disposition is not transferred to the donee while the donor is
stilla live. In determining whether a donation is one of mortis causa, the following characteristics must be taken
into account: (1) it conveys no title or ownership to the transferee before the death of the transferor; or what
amounts to the same thing, that the transferor should retain the ownership and control of the property while
alive; (2) that before his death, the transfer should be revocable by the transferor a twill, ad nutum; (3) that the
transfer should be void if the transferor should survive the transferee.

In the present case, the nature of the donations as mortis causa is confirmed by the fact that the
donations do not contain any clear provision that intends to pass proprietary rights to petitioners prior to
Cabatingan’s death. The phrase to become effective upon the death of the DONOR admits of no other
interpretation but that Cabatingan did not intend to transfer the ownership of the properties to petitioners during
her lifetime.
 That the donations were made in consideration of the love and affection of the donor does not qualify the
donations as inter vivos because transfers mortis causa may also be made for the same reason.

As the donation is in the nature of a mortis causa disposition, the formalities of a will should have been
complied with under ART 728 of the Civil Code, otherwise, the donation is void and would produce no effect.
#32 Puig vs. Peñaflorida

15 SCRA 276

Donation

FACTS:

Carmen Ubalde Vda. de Parcon died in the City of Iloilo, without forced heirs, leaving certain properties in
the City and province of Iloilo. She left a will and was survived by nephews and nieces, children of her predeceased
brother, Catalino Ubalde, and sister, Luisa Ubalde, married to Ariston Magbanua. Besides her will, the deceased
had executed two notarial deeds of donation. One, entitled DONACION MORTIS CAUSA, was executed on
November 24, 1948, in favor of her niece, Estela Magbanua. The deceased executed another deed of donation,
also entitled "ESCRITURA DE DONACION MORTIS CAUSA" in favor of the same donee, Estela Magbanua
Peñaflorida, conveying to her three parcels of land.

Defendants-appellants Estela Magbanua Peñaflorida, et al., insist that the reservation by the donor of the
right to dispose of the property during her lifetime in the deed of December 28, 1949 indicates that title had
passed to the donee in her lifetime, otherwise, it is argued, the reservation would be superfluous.

ISSUE:

Is the donation mortis causa or inter vivos?

HELD:

The Spanish Civil Code of 1889 (Art. 620) as well as the Civil Code of the Philippines (Art. 728), admit only
gratuitous transfers of title or real rights to property either by way of donation inter vivos or else by way of last will
and testament, executed with the requisite legal formalities. In the first case, the act is immediately operative,
even if the actual execution may be deferred until the death of the donor; in the second, nothing is conveyed to
the grantee and nothing is acquired by the latter, until the death of the grantor-testator, the disposition being until
then ambulatory and not final (Bonsatovs. Court of Appetite. 95 Phil. 481).

In dispositions mortis causa conveyance or alienation is revocable ad nutum, i.e., at the discretion of the
grantor or so-called "donor" simply because the latter has changed his mind (Bautista vs. Sabiniano, 92 Phil. 244;
Bonsato vs. Court of Appeals, supra).

The specification in the deed of donation of the causes whereby the act may be revoked by the donor
indicates that the donation is inter vivos,rather than a disposition mortis causa (Zapanta vs. Posadas, 52 Phil. 557).

The designation of the donation as mortis causa, or a provision in the deed to the effect that the donation
is "to take effect at the death of the donor" are notcontrolling criteria (Laureta vs. Mata, 44 Phil. 668; Concepcion
vs. Concepcion, L-4225, August 25, 1952; Cuevas us, Cuevas, 68 Phil. 68); such statements are to be construed
together with the rest of the instrument, in order to give effect to the real intent of the transferor (Concepcion
vs.Concepcion, supra; Bonsato vs. Court of Appeals,supra).

A conveyance for onerous consideration is governed by the rules of contracts and not by those of
donation or testament (Carlos vs. Ramil, 20 Phil. 183; Manalo vs. De Mesa, 29 Phil. 495).
 In case of doubt, the conveyance should be deemed donation inter vivos rather than mortis causa, in
order to avoid uncertainty as to the ownership of the property subject of the deed.

Defendant-appellant's argument that the stipulated power of the grantor to encumber or alienate the
property to persons, other than the donee, at any time before the grantor dies, should be viewed as a mere
resolutory condition that does not contradict but confirms the immediate effectivity of the donation is not legally
tenable, since it ignores the circumstance that the co-called "resolutory condition" is one purely dependent upon
the exclusive will of the grantor, and is proof that the deed, as executed, is not obligatory at all (Civ. Code of 1889,
Art. 1115; Civil Code of the Philippines, Art. 1182). Confirming the rule, both the old and the new Civil Codes
prescribe that the effectivity, compliance, or binding effect of contracts cannot be left to the sole will of one of the
parties (Art. 1256, Civ. Code of 1889; Art. 1308, Civil Code of the Philippines).
#33 Hemedes vs. CA

G.R. No. 107132, October 8, 1999

Petitioner: Maxima Hemedes

Respondents: Domnium Realty and Construction Corporation, Enrique D. Hemedes, and R & B Insurance
Corporation.

Facts:

A parcel of land was originally owned by the late Jose Hemedes, father of Maxima Hemedes and Enrique
Hemedes. Jose Hemedes executed a document entitled “Donation Inter Vivos with Resolutory Conditions”
whereby he conveyed ownership over the subject land, together with all its improvements, in favor of his third
wife, Justa Kauapin, subject to the following resolutory conditions:

(a) Upon the death or remarriage of the DONEE, the title to the property donated shall revert to any of the
children, or their heirs, of the DONOR expressly designated by the DONEE in a public document conveying the
property to the latter; or

(b) In absence of such an express designation made by the DONEE before her death or remarriage contained in a
public instrument as above provided, the title to the property shall automatically revert to the legal heirs of the
DONOR in common.

Pursuant to the first condition above mentioned, Justa Kausapin executed a “Deed of Conveyance of
Unregistered Real Property by Reversion” conveying to Maxima Hemedes the subject property. An OCT was issued
in the name of Maxima Hemedes by the Registry of Deeds of Laguna, with the annotation that “Justa Kausapin
shall have the usufructuary rights over the parcel of land herein described during her lifetime or widowhood.”

Maxima Hemedes and her husband Raul Rodriguez constituted a real estate mortgage over the subject
property in its favor to serve as security for a loan which they obtained in the amount of P6,000.00 from & B
Insurance. The latter extrajudicially foreclosed the mortgage since Maxima Hemedes failed to pay the loan even
after it became due. The land was sold at a public auction with R & B Insurance as the highest bidder and a
certificate of sale was issued by the sheriff in its favor. The annotation of usufruct in favor of Justa Kausapin was
maintained in the new title.

Despite the earlier conveyance of the subject land in favor of Maxima Hemedes, Justa Kausapin executed
a “Kasunduan” whereby she transferred the same land to her stepson Enrique Hemedes, pursuant to the
resolutory condition in the deed of donation executed in her favor by her late husband Jose Hemedes. Enrique
Hemedes later sold the property to Dominium Realty and Construction Corporation (Dominium). Justa Kausapin
executed an affidavit affirming the conveyance of the subject property in favor of Enrique Hemedes as embodied
in the “Kasunduan”, and at the same time denying the conveyance made to Maxima Hemedes.

Dominium leased the property to its sister corporation Asia Brewery, Inc. (Asia Brewery) who, even before
the signing of the contract of lease, constructed two warehouses made of steel and asbestos costing about
P10,000,000.00 each. Upon learning of Asia Brewery’s constructions upon the subject property, R & B Insurance
sent it a letter informing the former of its ownership of the property and of its right to appropriate the
constructions since Asia Brewery is a builder in bad faith. A conference was held between R & B Insurance and Asia
Brewery but they failed to arrive at an amicable settlement. Maxima Hemedes also wrote a letter addressed to
Asia Brewery wherein she asserted that she is the rightful owner of the subject property and that, as such, she has
the right to appropriate Asia Brewery’s constructions, to demand its demolition, or to compel Asia Brewery to
purchase the land. In another letter of the same date addressed to R & B Insurance, Maxima Hemedes denied the
execution of any real estate mortgage in favor of the latter.

Issue:

Whether or not R & B Insurance should be considered an innocent purchaser of the land in question.

Holding:

Yes. The annotation of usufructuary rights in favor of Justa Kausapin upon Maxima Hemedes’ OCT dose
not impose upon R & B Insurance the obligation to investigate the validity of its mortgagor’s title. Usufruct gives a
right to enjoy the property of another with the obligation of preserving its form and substance. The usufructuary is
entitled to all the natural, industrial and civil fruits of the property and may personally enjoy the thing in usufruct,
lease it to another, or alienate his right of usufruct, even by a gratuitous title, but all the contracts he may enter
into as such usufructuary shall terminate upon the expiration of the usufruct. Clearly, only the jus utendi and jus
fruendi over the property is transferred to the usufructuary. The owner of the property maintains the jus
disponendi or the power to alienate, encumber, transform, and even destroy the same. This right is embodied in
the Civil Code, which provides that the owner of property the usufruct of which is held by another, may alienate it,
although he cannot alter the property’s form or substance, or do anything which may be prejudicial to the
usufructuary. There is no doubt that the owner may validly mortgage the property in favor of a third person and
the law provides that, in such a case, the usufructuary shall not be obliged to pay the debt of the mortgagor, and
should the immovable be attached or sold judicially for the payment of the debt, the owner shall be liable to the
usufructuary for whatever the latter may lose by reason thereof. Based on the foregoing, the annotation of
usufructuary rights in favor of Justa Kausapin is not sufficient cause to require R & B Insurance to investigate
Maxima Hemedes’ title, contrary to public respondent’s ruling, for the reason that Maxima Hemedes’ ownership
over the property remained unimpaired despite such encumbrance. R & B Insurance had a right to rely on the
certificate of title and was not in bad faith in accepting the property as a security for the loan it extended to
Maxima Hemedes.
#34 KAPUNAN VS. CASILAN,

109 PHIL 889

DONATION

FACTS:

The subject lot in the controversy in this case is a commercial lot located in Tacloban City. Sometime in
1935, the owner of the subject lot executed a deed of donation in favor of their daughter Concepcion K. Salcedo
with all the formalities required by law meaning with acceptance by the done in a public document, in the
presence of witnesses and notarized by a notary public.

Sometime in 1939, Concepcion executed a deed of donation of the subject lot to her minor daughter who
is with her grandmother as the guardian of the minor and in behalf of the minor she accepted the donation with all
the formalities required by law.

In November 1944, Concepcion and private respondent, Casilan, executed a deed of sale on the subject
lot with Conception assuring that the deed of donation made in favor of her daughter is not legal and therefor she
has the right to alienate said lot to Casilan. After a while, Casilan demanded the delivery of the subject lot
believing that he now is the lawful owner of the subject lot.

ISSUE: Whether or not a donation to a minor thru his/her guardian is a valid donation?

RULING:

The court held, under Art. 633 of the Old Civil Code, a donation transfers the title effectively if it is
accepted with all the formalities that must accompany the acceptance of donations of realty, to wit, thru the
medium of a public instrument with authentic notice to the donor, unless the acceptance is made in the deed of
gift itself.

In the present case, the deed of donation executed by Concepcion K. Salcedo in favor of her daughter
Maria Antonia Salcedo states “that the said donee, Maria Antonia Kapunan Salcedo being a minor and being
represented by her maternal grandmother, Iluminada F. Vida de Kapunan, does express her appreciation and
gratefulness for the generosity of the donor.” The acceptance having been made in the deed of gift itself,
notification thereof to the donor in a “constancia autentica” was evidently not necessary.

It is true that the acceptance was made on another date and In a place other than that where the deed
was executed, but the deed of donation as so worded implied a previous understanding between the parties who
interviewed therein, and, whatsoever, the donor, Concepcion K. Salcedo, admittedly knew of the actual
acceptance by the doner through the latter’s grandmother.

Pursuant to Art. 623 of the Old Civil Code, her knowledge of such acceptance perfected the donation.
#35 Abragan vs De Cenhtenera (Donation)

FACTS:

On 18 January 1923, plaintiffs, Juliana and Julieta Abragan (Abragans), filed an amended complaint before the
Court of First Instance of the province of Camarines Sur (1) to obtain a judicial declaration that 3 parcels of real
property that are present in the 2 deeds of gift executed by deceased father of Juliana Abragan, Don Andres
Garchitorena, belongs to the plaintiffs—in usufruct to Juliana Abragan and nude ownership to Julieta Abragan,
granddaughter of deceased; and (2) to recover sum of money as alleged damages for the detention of properties
by the deceased’s estate administrator, Jose N. Garchitorena. The records show that not long before the
deceased’s death in 1921, Andres Garchitorena executed 2 deeds of gift. The first deed conveys to the Abragans,
first, 1 nine-hectare land with fruit-bearing coconut trees located in Matacla, Goa, Camarines Sur (P2,000.00-
worth); and, second, 1 446sqms-building lot with warehouse in Tigaon (P1,900.00-worth). The second deed
conveys to the Abragans 1 twenty-hectare hemp land located in Tinawagan, Tigaon, Camarines Sur. Both of these
instruments, despite expressed acceptance as gifts, were not at any time acknowledged before a notary public.
After the death of the donor, Rita G. De Centenera, the sole heir of the donor, executed a deed of ratification
declaring, in favor of the Abragans, the first deed covering property donations while none was said on the second
deed. Thereafter, Rita ceased as a special administrator of the late Garchitorena and one Jose N. Garchitorena was
appointed in her stead. The properties mentioned in the deeds of gift appear to have into his possession, refusing
to recognize the validity of the donations. The case did not stand a chance in the Court of First Instance; hence, the
existence of this appeal before the Supreme Court.

ISSUE/S:

1. Whether or not the Abragans have the undisputableright to usufruct and nude ownership over the 3 parcels of
real property of deceased Don Andres Garchitorena in the case at bar.

2. Whether or not the Abragansmay still have a right toclaim said properties despite lack of undisputable right over
the same.

RULING/S:

1. No. As how the Supreme Court appreciated the facts and circumstances of the case at bar, the deeds of gift had
no effect per se for the reason that the instruments referred to never took the form of a public document and
were not accepted by the donees in any public document in the life of the donor.
2. Yes. As provided for by Spain’s Supreme Court decision over 5 Manresa, 2d ed., 115., although the deeds of gift
had never been accepted in the form required by law, the ratification of the heir, Rita G. De Centenera for the case
at bar, of the deceased donor was given effect.