Property Case Doctrines

PROPERTY CASE DOCTRINES: 4) 1)

Lopez vs. Orosa – Whether the materialmen’s lien for the value of the construction materials used attaches to the building alone and does not extend to the land on which the building is adhered to

Ruling: No, the inclusion of the building, separate and distinct from the land, in the enumeration in Article 415 could only mean that a building is by itself an immovable property. Moreover, and in view of the absence of any specific provision of law to the contrary, a building is an immovable property, irrespective of whether or not said structure and the land on which it is adhered to belong to the same owner. 2)

Davao Sawmill Co vs. Castillo: tenant Davao Sawmill erected a building which housed the machinery used by it on the lessor’s land. Some of the machinery used were placed and mounted on foundations of cement.

Ruling: The machinery is movable. However, machinery may be immobilized by destination or purpose under the following conditions: General Rule: The machinery only becomes immobilized if placed in a plant by the owner of the property or plant. Immobilization cannot be made by a tenant, a usufructuary, or any person having only a temporary right. Exception: The tenant, usufructuary, or temporary possessor acted as agent of the owner of the premises; or he intended to permanently give away the property in favor of the owner. As a rule, therefore, the machinery should be considered as Personal Property, since it was not placed on the land by the owner of the said land. 3)

Issue: Whether or not the value of the excavated soil should be included in the computation of just compensation Ruling: There is no legal basis to separate the value of the excavated soil from that of the expropriated properties, contrary to what the trial court did. In the context of expropriation proceedings, the soil has no value separate from that of the expropriated land. Just compensation ordinarily refers to the value of the land to compensate for what the owner actually loses. Such value could only be that which prevailed at the time of the taking. In National Power Corporation v. Ibrahim, et al. The SC held that rights over lands are indivisible. This conclusion is drawn from Article 437 of the Civil Code which provides: “The owner of a parcel of land is the owner of its surface and of everything under it, and he can construct thereon any works or make any plantations and excavations which he may deem proper, without detriment to servitudes and subject to special laws and ordinances. He cannot complain of the reasonable requirements of aerial navigation.” Thus, the ownership of land extends to the surface as well as to the subsoil under it. As pointed out by the OSG, the law does not limit the use of the expropriated land to the surface area only. To sanction the payment of the excavated soil is to allow the landowners to recover more than the value of the land at the time when it was taken, which is the true measure of the damages, or just compensation, and would discourage the construction of important public improvements. 5)

Spouses Guidangen v. Wooden – SALN is not a proof of ownership. Tax declarations and receipts are indeed only prima facie proof of ownership. However, the SALN cannot take precedence over a tax declaration. Ownership and possession are established by a Certificate of Title and, in its absence, by a Tax Declaration.

6)

VSD Realty v. Uniwide – Art. 448 does not apply because said provision only applies to a possessor in good faith who builds on another’s land with the belief that he is the owner thereof. It does not apply where one’s interest is only that of a lessee under a rental contract. Otherwise, it would be in the power of the tenant to “improve” his landlord out of the latter’s property.

7)

Republic vs. Santos III – The drying up of a river is not accretion as defined in Art. 457. It belongs to the State as property of public dominion, not to the riparian owner.

8)

Felices vs. Iriola - Art. 453 cannot apply because the improvements in question were made on the premises only after Felices had tried to recover the land in question from Iriola. After Iriola had refused to restore the land to the Felices, to the extent that the latter even had to resort to the present action to recover his property, Felices could no longer be regarded as having impliedly assented or conformed to the improvements thereafter made by Iriola on the premises.

Jakosalem and Dulfo vs. Barangan: suit by Barangan to recover possession of real property occupied by petitioners

Ruling: Article 434 of the Civil Code provides that “in an action to recover, the property must be identified, and the plaintiff must rely on the strength of his title and not on the weakness of the defendant’s claim.” In other words, in order to recover possession, a person must prove (1) the identity of the land claimed, and (2) his title. Since respondent Barangan was deprived of possession of the subject property, he is entitled to reasonable compensation in the amount of P3,000.00 per month from the date of judicial demand up to the time petitioners vacate the subject property. The legal interest of which shall be at the rate of 6% per annum from judicial demand and at the rate of 12% per annum from the time the judgment of this Court becomes final and executory until the obligation is fully satisfied. Finally, as to the issue of laches and prescription, we agree with the CA that these do not apply in the instant case. Jurisprudence consistently holds that “prescription and laches cannot apply to registered land covered by the Torrens system” because “under the Property Registration Decree, no title to registered land in derogation to that of the registered owner shall be acquired by prescription or adverse possession.”

Republic vs. Rural Bank of Kabacan: In the context of expropriation proceedings, the soil has no value separate from that of the expropriated land because real properties are characteristically indivisible; hence, the ownership of the land extends to the surface as well as to the subsoil under it.

Upon the other hand, Iriola, recognizing as he does Felices’ right to get back his property, continued to act in bad faith when he made improvements on the land in question after he had already been asked extra-judicially and judicially, to surrender and return its possession to Felices; and as a penalty for such bad faith, he must forfeit his improvements without any right to reimbursement therefor. “He who builds, plants or sows in bad faith on the land of another, loses that is built, planted, or sown without right to indemnity” (Art. 449, New Civil Code) 9)

Macasaet v. Macasaet - Article 447 is not applicable, because it relates to the rules that apply when the owner of the property uses the materials of another. It does not refer to the instance when a possessor builds on the property of another. On the other hand, 448 applies: GR: This Court has ruled that this provision covers only cases in which the builders, sowers or planters believe themselves to be owners of the land or, at least, to have a claim of title thereto. It does not apply when the interest is merely that of a holder, such as a mere tenant, agent or usufructuary. From these pronouncements, good faith is identified by the belief that the land is owned; or that -- by some title -- one has the right to build, plant, or sow thereon. Exception: However, in some special cases, this Court has used Article 448 by recognizing good faith beyond this limited definition. Thus, in Del Campo v. Abesia, this provision was applied to one whose house -- despite having been built at the time he was still co-owner -- overlapped with the land of another. This article was also applied to cases wherein a builder had constructed improvements with the consent of the owner. The Court ruled that the law deemed the builder to be in good faith. In Sarmiento v. Agana, the builders were found to be in good faith despite their reliance on the consent of another, whom they had mistakenly believed to be the owner of the land. The established facts of this case show that respondents (parents) fully consented to the improvements introduced by petitioners (son and his family). In fact, because the children occupied the lots upon their invitation, the parents certainly knew and approved of the construction of the improvements introduced thereon. Thus, petitioners may be deemed to have been in good faith when they built the structures on those lots.

10) Pecson vs. CA – 448 does not apply where the owner of the land is the builder who then loses ownership of the land by sale or auction. Nevertheless, the provision on indemnity may apply by analogy since the primary intent of the law is to avoid a state of forced co-ownership. The current market value of the improvements should be the basis of reimbursement. The right to retain the improvements while the corresponding indemnity is not paid implies tenancy or possession in fact of the land on which it is built, planted or sown, and retention of ownership of the improvements as well as the income therefrom. 11) Nuguid vs. CA - Under Article 448, the landowner is given the option, either to appropriate the improvement as his own upon payment of the proper amount

of indemnity or to sell the land to the possessor in good faith. Relatedly, Article 546 provides that a builder in good faith is entitled to full reimbursement for all the necessary and useful expenses incurred; it also gives him right of retention until full reimbursement is made. While the law aims to concentrate in one person the ownership of the land and the improvements thereon in view of the impracticability of creating a state of forced co-ownership,[23] it guards against unjust enrichment insofar as the good-faith builder’s improvements are concerned. The right of retention is considered as one of the measures devised by the law for the protection of builders in good faith. Its object is to guarantee full and prompt reimbursement as it permits the actual possessor to remain in possession while he has not been reimbursed (by the person who defeated him in the case for possession of the property) for those necessary expenses and useful improvements made by him on the thing possessed.[24] Accordingly, a builder in good faith cannot be compelled to pay rentals during the period of retention[25] nor be disturbed in his possession by ordering him to vacate. In addition, as in this case, the owner of the land is prohibited from offsetting or compensating the necessary and useful expenses with the fruits received by the builder-possessor in good faith. Otherwise, the security provided by law would be impaired. This is so because the right to the expenses and the right to the fruits both pertain to the possessor, making compensation juridically impossible; and one cannot be used to reduce the other.

12) National Spiritual Assembly of the Baha’is vs. Pascual – Two indispensable requisites in an action to quiet title: (1) That the plaintiff or complaint has a legal or an equitable title to or interest in the real property subject of the action; and (2) that a deed, claim, encumbrance or proceeding is claimed to be casting a cloud on his title.  In this case, petitioner no longer has legal title over the land because of the decision of the Bureau of Lands (in a previous case) ordering petitioner to vacate the lot, which already attained finality. 13) Ampil vs. Manahan - Co-ownership; action for ejectment. Article 487 of the Civil Code provides that anyone of the co-owners may bring an action for ejectment without joining the others. The action is not limited to ejectment cases but includes all kinds of suits for recovery of possession since the suit is presumed to have been instituted for the benefit of all. Co-owners are not indispensable parties, they are not even necessary parties to an action for ejectment, for complete relief could be afforded even in his absence. Hence, Exequiel, a coowner, may bring the action for unlawful detainer even without the special power of attorney of his coheirs. 14) Rizal vs. Naredo - Article 484 of the New Civil Code provides that there is coownership whenever the ownership of an undivided thing or right belongs to different persons. Thus, on the one hand, a co-owner of an undivided parcel of land is an owner of the whole, and over the whole he exercises the right of dominion, but he is at the same time the owner of a portion which is truly abstract. On the other hand, there is no co-ownership when the different

portions owned by different people are already concretely determined and separately identifiable, even if not yet technically described. Pursuant to Article 494 of the Civil Code, no co-owner is obliged to remain in the co-ownership, and his proper remedy is an action for partition under Rule 69 of the Rules of Court, which he may bring at anytime in so far as his share is concerned. Article 1079 of the Civil Code defines partition as the separation, division and assignment of a thing held in common among those to whom it may belong. It has been held that the fact that the agreement of partition lacks the technical description of the parties' respective portions or that the subject property was then still embraced by the same certificate of title could not legally prevent a partition, where the different portions allotted to each were determined and became separately identifiable. 15) Heirs of Restar vs. Cichon – While the action to demand partition of a co-owned property does not prescribe, a co-owner may acquire ownership thereof by prescription where there exists a clear repudiation of the co-ownership, and the co-owners are apprised of the claim of adverse and exclusive ownership. Acquisitive prescription of dominion and other real rights may be ordinary or extraordinary. Ordinary acquisitive prescription requires possession of things in good faith and with just title for a period of ten years. Without good faith and just title, acquisitive prescription can only be extraordinary in character which requires uninterrupted adverse possession for thirty years. 16) Si vs. CA – After the physical division of the lot among the co-owners, the community ownership is terminated, and the right of pre-emption or redemption for each other was no longer available. There is no co-ownership when the different portions owned by the different people are already concretely determined and separately identifiable, even if not technically described. 17) De Guia vs. CA - Any co-owner may file an action under Article 487 not only against a third person, but also against another co-owner who takes exclusive possession and asserts exclusive ownership of the property. In the latter case, however, the only purpose of the action is to obtain recognition of the coownership. The plaintiff cannot seek exclusion of the defendant from the property because as co-owner he has a right of possession. The plaintiff cannot recover any material or determinate part of the property. The right of enjoyment by each co-owner is limited by a similar right of the other co-owners. A co-owner cannot devote common property to his exclusive use to the prejudice of the co-ownership. Hence, if the subject is a residential house, all the co-owners may live there with their respective families to the extent possible. However, if one co-owner alone occupies the entire house without opposition from the other co-owners, and there is no lease agreement, the other co-owners cannot demand the payment of rent. Conversely, if there is an agreement to lease the house, the co-owners can demand rent from the coowner who dwells in the house.

18) Heirs of Maligaso vs. Encinas - Forcible entry and unlawful detainer cases are summary proceedings designed to provide for an expeditious means of protecting actual possession or the right to the possession of the property involved. The avowed objective of actions for forcible entry and unlawful detainer, which have purposely been made summary in nature, is to provide a peaceful, speedy and expeditious means of preventing an alleged illegal possessor of property from unjustly continuing his possession for a long time, thereby ensuring the maintenance of peace and order in the community. The said objectives can only be achieved by according the proceedings a summary nature. However, its being summary poses a limitation on the nature of issues that can be determined and fully ventilated. It is for this reason that the proceedings are concentrated on the issue on possession. Thus, whether the petitioners have a better right to the contested area and whether fraud attended the issuance of Maria’s title over Lot No. 3517 are issues that are outside the jurisdiction and competence of a trial court in actions for unlawful detainer and forcible entry. This is in addition to the long-standing rule that a Torrens title cannot be collaterally attacked, to which an ejectment proceeding, is not an exception. Possession of the property, for whatever length of time, cannot prevail over a Torrens title, the validity of which is presumed and immune to any collateral attack. 19) Ramos vs. Director of Lands - The general rule is that possession and cultivation of a portion of a tract of land under the claim of ownership of all is a constructive possession of all, if the remainder is not in the adverse possession of another. The claimant has color of title; he acted in good faith and he has open, peaceable, and notorious possession of a portion of the property, sufficient to apprise the community and the world that the land was for his enjoyment. Possession in the eyes of the law does not mean that a man has to have his feet on every square meter of ground before it can be said that he is in possession. 20) Director vs. CA - Courts cannot reclassify; it is beyond their competence and jurisdiction. The classification of public lands is an exclusive prerogative of the Executive Department of the Government (Bureau of Forest Development) and not of the Courts. In the absence of such classification, the land remains as unclassified land until it is released therefrom and rendered open to disposition. Since the property is still unclassified, whatever possession applicants may have had and however long cannot ripen into private ownership. The conversion of the property into a fishpond by applicants does not automatically render the property alienable and disposable. The recommendation of the District Forester for release of property from unclassified region is not the ultimate word on the matter.