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ATENEO DE DAVAO UNIVERSITY Davao City BAR OPERATIONS 09 PROPERTY ATTY. ED C.

BATACAN*

Is the prospective buyer obliged to go beyond the certificate to determine the condition of the property? NO. Every person dealing with registered land may safely rely on the correctness of the certificate of title issued therefor and the law will in no way oblige him to go beyond the certificate to determine the condition of the property. Erasusta, Jr. vs. Court of Appeals 495 SCRA 319 What is the nature of a conveyance of a property prior to its registration? No deed, mortgage, lease, or other voluntary instrument, except a will purporting to convey or affect registered land shall take effect as a conveyance or bind the land, but shall operate only as a contract between the parties and as evidence of authority to the Register of Deeds to make registration. Adverse claim is done by making a statement in writing setting forth a partys alleged right or interest, and how or under whom acquired, a reference to the number of the certificate of title of the registered owner, the name of the registered owner, and a description of the land in which the right or interest is claimed. Rodriguez vs. Court of Appeals 495 SCRA 490 What is the nature of an adverse claim? The annotation of an adverse claim is a measure designed to protect the interest of a person over a piece of real property where the registration of such interest or right is not otherwise provided for by the Land Registration Act, and serves as a notice and warning to third parties dealing with said property that someone is claiming an interest on the same or a better right than the registered owner thereof. The deed of sale with assumption of mortgage is a registrable instrument. It must be registered with the Office of the Register of Deeds in order to bind third parties. Rodriguez vs. Court of Appeals 495 SCRA 490 Public use; Property of public dominion. The Airport lands and

buildings of the MIAA are property of public dominion and therefore owned by the State or the Republic of the Philippines. The term ports in Article 420 (1) of the Civil Code includes seaports and airports the MIAA Airport Lands and Buildings constitute a port constructed by the State. They are devoted to public use because they are used by the public for international and domestic travel and transportation; The charging of fees to the public does not determine the character of the property whether it is of public dominion or not. Manila International Airport Authority vs. Court of Appeals 495 SCRA 591 Issue in forcible entry and unlawful detainer action. In unlawful detainer and forcible entry cases, the only issue to be determined is who between the contending parties has better possession of the contested property; An accion publiciana, also known as accion plenaria de posesion, is a plenary action for recovery of possession in an ordinary civil proceeding in order to determine the better and legal right to possess, independently of title. Bejar vs. Caluag, 516 SCRA 84. A party who can prove prior possession can recover such possession even against the owner himself. Lumbres vs. Tablada, Jr., 516 SCRA 575 Significance of tax declarations. It has been ruled that while tax declarations and realty tax payment of property are not conclusive evidence of ownership, nevertheless, they are good indicia of the possession in the concept of owner for no one in his right mind would be paying taxes for a property that is not in his actual or at least constructive possession. They constitute at least proof that the holder has a claim of title over the property. Republic vs. Enriquez, 501 SCRA 436. While tax declarations and receipts are not conclusive evidence of ownership and do not prove title to the land, nevertheless, when coupled with actual possession, they constitute evidence of great weight and can be the basis of a claim of ownership through prescription. Aguirre vs. Heirs of Lucas Villanueva 505 SCRA 855. Nature of possession by tolerance. A person who occupies the land of another at the latters tolerance or permission, without any contract between them, is necessarily bound by an implied promise to vacate upon demand, failing which, a summary action for ejectment is the proper remedy. Quevada vs. Court of Appeals, 502 SCRA 233 Action for reconveyance is imprescriptible. An action for reconveyance prescribes in ten years, the point of reference being the date of registration of the deed or the date of issuance of the certificate of title over the property- an action for reconveyance is imprescriptible only when the plaintiff is in actual possession of the property. Heirs of Emilio 2

Santioque vs. Heirs of Emilio Calma, 505 SCRA 665. The prescriptive period for the reinvidicatory action has not yet commenced to run where the plaintiff was in actual or physical possession of the property when he filed his complaint, Iglesia ni Cristo vs Ponferrada, 505 SCRA 828. Possession in good faith. Possession is in good faith when there is a reasonable belief that the person from whom the thing is received has been the owner thereof and could thereby transmit his ownership; There is just title when the adverse claimant comes into possession of the property through any of the modes recognized by law for the acquisition of ownership or other real rights, but the grantor is neither the owner nor in a position to transmit the right. Aguirre vs. Heirs of Lucas Villanueva, 505 SCRA 855. Quieting of title. An action for quieting of title is a remedy which may be availed of only when by reason of any instrument, record, claim, encumbrance or proceeding, which appears valid but is, in fact, invalid, ineffective, voidable or unenforceable, a cloud is thereby cast on the complainants title to real property or any interest therein. .Verily, for an action to quiet title to prosper, two indispensable requisite must concur, namely: 1. the plaintiff or the complainant has a legal or an equitable title to or interest in the real property subject of the action; and 2. the deed, claim, encumbrance or proceeding claimed to be casting cloud on his title must be shown to be in fact invalid or inoperative despite prima facie appearance of validity or legal efficacy. Heirs of Enriquez Diaz vs Virata 498 SCRA 141. Right of possession as an incident of ownership, exception. Undeniably, under the law, jus possidendi is a necessary incident of ownership. However, the owner cannot exercise this right to the prejudice of a party whose possession is predicated on a contract like agency, trust, pledge or lease, as in this case. Under the LPA between MMTC and DMCI, the latter, as lessee, had a right of possession over the buses and it may be deprived of said right only if it failed to pay its dues for three consecutive months. Both the trial court and the appellate court established that there was actually no default on the part of DMCI justifying MMTCs seizure of the buses. MMTC cannot now use the principle of jus possidendi as an excuse for its unwarranted act and frustrate the redelivery of the vehicles to DMCI. In addition, a party vested with the right of possession to the property may set up this right even against the owner thereof. Under Article 539 of the Civil Code, every possessor has a right to be respected in his possession and, if deprived of such right, the law shall restore it to him. In the case at bar, after having been unjustly denied of its right of possession to the buses, DMCI is entitled to get them 3

back from MMTC. But since the buses can no longer be returned in their original state and considering further that DMCI has already paid their full amount, the CA resolution ordering MMTC to instead pay DMCI their value at the time of repossession is correct. Metro Manila Transit vs D.M. Consortium 517 SCRA Rule in case of double sale. Where it is immovable property that is the subject of double sale, ownership shall be transferred 1. to the person acquiring it who in good faith first recorded it in the Registry of Property; 2. in default thereof, to the person in good faith was the first in possession; 3. in default thereof, to the person who presents the oldest title, provided there is good faith. Carillo vs. Court of Appeals 503 SCRA 66 Nature of letter of intent to purchase. No right of possession, which is the only issue in an unlawful detainer case, arises from such Letter of Intent which, as it clearly states, merely signifies intent to, not actually transfer ownership. Altizo vs. BRYC-V Development Corporation 503 SCRA 87. Principle of Possession in Good Faith. It has been said that good faith is always presumed, and upon him who alleges bad faith on the part of the possessor rests the burden of proof. Good faith is an intangible and abstract quality with no technical meaning or statutory definition, and it encompasses, among other things, an honest belief, the absence of malice and the absence of design to defraud or to seek an unconscionable advantage. An individuals personal good faith is a concept of his own mind and, therefore, may not conclusively be determined by his protestations alone. It implies honesty of intention, and freedom from knowledge of circumstances which ought to put the holder upon inquiry. The essence of good faith lies in an honest belief in the validity of ones right, ignorance of a superior claim, and absence of intention to overreach another. Applied to possession, one is considered in good faith if he is not aware that there exists in his title or mode of acquisition any flaw which invalidates it. Heirs of Marcelino Cabal vs Cabal 497 SCRA 304 Principle of co-ownership. It is undisputed that Marcelino built his house on the disputed property in 1949 with the consent of his father. Marcelino has been in possession of the disputed lot since then with the knowledge of his co-heirs, such that even before his father died in 1954, when the co-ownership was created, his inheritance or share in the coownership was already particularly designated or physically segregated. Thus, even before Lot G was subdivided in 1976, Marcelino already occupied the disputed portion and even then co-ownership did not apply 4

over the disputed lot. Elementary is the rule that there is no co-ownership where the portion owned is concretely determined and identifiable, though not technically described, or that said portion is still embraced in one and the same certificate of title does make said portion less determinable or identifiable, or distinguishable, one from the other, nor that dominion over each portion less exclusive, in their respective owners. Heirs of Marcelino Cabal vs Cabal 497 SCRA 302 Adulterous relationship. Because the cohabitation of Villanueva and Gonzales from 1927 to 1963 was adulterous, their property relations during those 36 years were not governed by Article 144 of the Civil Code which applies only if the couple living together is not in any way incapacitated from getting married. According to the doctrine laid down by Juaniza vs. Jose, 89 SCRA 306 (1979), no co-ownership exists between parties to an adulterous relationship. In Agapay v. Palang, 276 SCRA 340 (1997), we expounded on this doctrine by declaring that in such a relationship, it is necessary for each of the partners to prove his or her actual contribution to the acquisition of in order to be able to lay claim to any portion of it. Presumptions of coownership and equal contribution do not apply. Rivera vs Heirs of Romulado Villanueva 496 SCRA 136 Loss brought about by the concurrent negligence of two persons shall be borne by the one who was in the immediate, primary and overriding position to prevent it. FACTS: Guillermo Adriano is the registered owner of a parcel of land. In 1990, he entrusted the original owners copy of the title to the said land to Angelina Salvador, a d istant relative, for the purpose of securing a mortgage loan. However, Angelina Salvador without the knowledge and consent of Guillermo Adriano, mortgaged the land to Pangilinan by forging the signature of Adriano for PhP60,000.00. The decision of the lower court in favor of Adriano was reversed by the Court of Appeals it being that Adriano had been negligent in entrusting and delivering his title to a distant relative who undertook to find a money lender. ISSUE : Was Adriano negligent in entrusting and delivering his TCT to a relative who was supposed to help him find a money lender? And if so, was such negligence sufficient to deprive him of his property? HELD : Pangilinan was not an innocent mortgagee for value since he failed to observe due diligence in the grant of the loan and in the execution of the real estate mortgage. Loss brought about by the concurrent negligence of two persons shall be borne by the one who was in the immediate, primary and overriding position to prevent it. In the present case, the mortgagee who is engaged in the business of lending money secured by real estate mortgages could have easily avoided the loss by simply exercising due diligence in ascertaining 5

the identity of the impostor who claimed to be the registered owner of the property mortgaged. The negligence of Adriano is not enough to offset the fault of Pangilinan himself in granting the loan. The former should not be made to suffer for respondents failure to verify the identity of the mortgagor and the actual status of the subject property before agreeing to the real estate mortgage. ADRIANO VS PANGILINAN, 373 SCRA 544. Ownership of the thing sold is a real right, which the buyer acquires only upon delivery of the thing to him. And there is said to be delivery if and when the thing sold is placed in control and possession of the vendee. FACTS : On two separate occasions, Carmelo & Bauermann, Inc. (Carmelo) executed two lease contracts in favor of Mayfair Theater, Inc. (Mayfair) for the lease of a two-storey building for a period of 20 years. Both contracts provide for a right of first refusal in favor of Mayfair. Subsequently, Carmelo sold the leased premises to Equitorial Realty Development, Inc. (Equitorial) without first offering the same to Mayfair. As a result thereof, Mayfair filed a case against Equitorial and Carmelo for the Annulment of the Deed of Sale executed by the latter to the former. While the case was pending, Mayfair paid rents to Equitorial to avoid eviction. The Supreme Court upheld the decision of the Court of Appeals rescinding the Deed of Absolute Sale, ordering the return of the purchase price to Equitorial and for Mayfair to buy the property from Carmelo. In the meantime, Equitorial, representing as the owner of the leased premises, filed a case against Mayfair for collection of unpaid rents or reasonable compensation for Mayfairs possession of the leased premises after the expiration of the lease contracts. Issue : Is Equitorial entitled to back rentals? Held : Rent is a civil fruit that belongs to the owner of the property producing it by right of accession. Consequently and ordinarily, the rentals that fell due from the time of the perfection of the sale to Equitorial until its rescission by final judgment should belong to the owner of the property during that period. Ownership of the thing sold is a real right, which the buyer acquires only upon delivery of the thing to him. And there is said to be delivery if and when the thing sold is placed in control and possession of the vendee. Equitorial never took actual control and possession of the property sold, in view of the timely objection to the sale and the continued actual possession of the property. The objection took the form of a court action impugning the sale which was rescinded. While the execution of the deed of sale is recognized by law as equivalent to the delivery of the thing sold, such constructive or symbolic delivery, being merely presumptive, is deemed negated by the failure of the vendee to take actual possession of the land sold. Delivery has been described as a composite act, a thing in which both parties must join and the minds of both parties concur. It is an act by which one 6

party parts with the title to and the possession of the property, and the other acquires the right to and the possession of the same. In its natural sense, delivery means something in addition to the delivery of property or title. It means transfer of possession. Both actual and constructive delivery contemplate the absolute giving up of the control and custody of the property on the part of the vendor, and the assumption of the same by the vendee. The fact that Mayfair paid rentals to Equitorial during the litigation should not be interpreted to mean either actual delivery or ipso facto recognition of Equitorials title as the owner since they were made merely to avoid imminent eviction. Equitorial never acquired ownership not because the sale was void, but because the sale was not consummated by a legally effective delivery of the property sold. Equitorial Realty Development, Inc. vs Mayfair Theater, Inc. 370 SCRA 56. The nature of the disputed machineries, i.e., that they were heavy, bolted or cemented on the real property mortgaged, does not make them ipso facto immovable under Article 415 (3) and (5) of the New Civil Code, as the parties intent has to be looked into. FACTS : Ever Textile Mills, Inc. (EVERTEX) obtained two loans from Philippine Bank of Communications (PBCom) in 1975 and 1979. The first was secured by a Deed of Real and Chattel Mortgage covering the lot where its factory stands, and the machineries and equipment installed therein. The second was secured by a Chattel Mortgage covering the same machineries and equipment. In 1981, EVERTEX purchased various machineries and equipment which it installed in the factory. EVERTEX failed to meet its obligation prompting PBCOm to commence extra-judicial foreclosure proceedings. An auction sale was held wherein PBCom was the highest bidder. A certificate of sale was issued. On March 7, 1984, PBCOm consolidated its ownership over the lot and all the properties in it. In 1986, PBCOM leased the entire factory premises to Ruby Tsai and later sold it to her, including the machineries and equipment installed by EVERTEX in 1981. EVERTEX filed a complaint for annulment of sale, etc. against PBCOM averring that the machineries and equipment installed in 1981 are not covered by the mortgages. On her part, Tsai contended that the disputed machineries, i.e. that they were heavy, bolted and cemented on the real property mortgaged by EVERTEX to PBCom, make them ipso facto immovable [either by incorporation or purpose] under Art. 415, pars (3) and (5), hence, covered by the real estate mortgage. ISSUE: Whether or not the disputed properties are considered as immovable? If not, were they covered by the chattel mortgage? HELD : The nature of the disputed machineries, i.e., that they were heavy, bolted or cemented on the real property mortgaged, does not make them ipso facto immovable under Article 415 (3) and (5) of the New Civil Code, as the parties intent has to be looked into. While it is true that the controverted properties appear to be 7

immobile, a perusal of the Contract of Real and Chatttel Mortgage executed by the parties show a contrary indication. In the case at bar, the intention of the parties is to treat the said machineries and equipment as chattels. The parties executed a Real Estate Mortgage and Chattel Mortgage, instead of just Real Estate Mortgage if indeed their intention is to treat all the properties included therein as immovable. Also attached to the said contract is separate List of Machineries and Equipment. These facts evince the conclusion that the parties intend to treat the machineries as chattels. Thus, the after-acquired properties must also be treated as chattels. But considering that the disputed properties were acquired in 1981 and could not have been involved in the 1975 or the 1979 chattel mortgages, it was an error to include such subject machineries with the properties enumerated in the said chattel mortgages. As the auction sale of the subject properties to PBCom is void, no valid title passed in its favor. Consequently, the sale thereof to Tsai is also a nullity. TSAI vs. COURT OF APPEALS, 366 SCRA 324; October 2, 2001. There is no provision of law which grants the lessee a right of retention over the leased premises on that ground. Art. 448 of the Civil Code, in relation to Art. 546, which provides for 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 a land in the belief that he is the owner thereof. FACTS : Petitioners were lessees of a commercial unit located in Baclaran. The lease was for a period of five (5) years, to expire in 1989. The contract expressly provided for the renewal of the lease at the option of the lessee in accordance with the terms of agreement and conditions set by the lessor. Prior to the expiration of the lease, the parties discussed the possibility of renewing it. They exchanged proposal and counterproposal but they failed to reach an agreement. Subsequently a case for unlawful detainer was filed against petitioners. Petitioners contend that they acted in good faith in not vacating the leased premises after the expiration of the contract under the belief that they are entitled to an extension of the lease and because they had made repairs and improvements on the premises. ISSUE : Were the lessees entitled to a right of retention of the leased premises until reimbursement of the useful improvements made by them on the leased premises? HELD : The fact that petitioners made repairs on the premises is not a reason to retain the possession of the premises. There is no provision of law which grants the lessee a right of retention over the leased premises on that ground. Art. 448 of the Civil Code, in relation to Art. 546, which provides for 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 a land in the belief that he is the owner thereof. This 8

right is not applicable to a mere lessee, otherwise, it would always be in his power to improve his landlord out of the latters property. CHUA vs COURT OF APPEALS, 301 SCRA 358. Donation has the following elements: the reduction of the patrimony of the donor; the increase in the patrimony of the donee; and, the intent to do an act of liberality or animus donandi. Facts: During the 1987 elections, Manuel Abello, Jose Concepcion, Teodoro Regala, and Avelino Cruz, who are partners in the ACCRA law firm, contributed P882,661.31 each to the campaign funds of Edgardo Angara, then running for the Senate. The BIR assessed each of them P263,032.66 for their contributions. They questioned the assessment through a letter to the BIR. They claimed that political or electoral contributions are not considered gifts under the NIRC, and that, therefore, they are not liable for donor's tax. Issue: Should the contributions to the campaign fund of Angara be considered donations? Held: YES. Art. 725 defines donation as: an act of liberality whereby a person disposes gratuitously of a thing or right in favor of another, who accepts it. Donation has the following elements: the reduction of the patrimony of the donor; the increase in the patrimony of the donee; and, the intent to do an act of liberality or animus donandi. The present case falls squarely within the definition of a donation. Abello, et al each gave P882,661.31 to the campaign funds of Senator Angara, without any material consideration. All three elements of a donation are present: The patrimony of Abello, et al were reduced by P882,661.31 each Angara's patrimony correspondingly increased by P3,530,645.249.There was intent to do an act of liberality or animus donandi was present since each of the petitioners gave their contributions without any consideration. Manuel Abello vs CIR, Feb 23, 2005. Simple Donation. Facts: On Jan 30, 1985, Catalina Jacob executed in Canada a Deed of Donation over a Lot 8W in favor of her grandson, Tito Lagazo. Following the donation, Tito checked with the Register of Deeds and found out that the property was in the delinquent list, so that he paid the installments in arrears and the remaining balance on the lot and declared the said property in the name of Catalina Jacob. Issue: Whether the donation was simple or onerous. Held: Simple. Even conceding that Tito's full payment of the purchase price of the lot might have been a burden to him, such payment was not however imposed by the donor as a condition for the donation. Rather, the deed explicitly stated: "That for and in consideration of the love and affection which the DONEE inspires in the DONOR, and as an act of liberality and generosity and considering further that the DONEE is a grandson of the DONOR, the DONOR hereby voluntarily and freely gives, transfer[s] and conveys, by way of donation unto said DONEExxx It is clear that the donor did 9

not have any intention to burden or charge Tito as the donee. The words in the deed are in fact typical of a pure donation. The payments made by Tito were merely his voluntary acts. Lagazo vs. CA, 3-15-98. Mortis causa donation. Facts: In April 11, 1958, Celestina Ganuelas executed a Deed of Donation of Real Property covering 7 parcels of land in favor of her niece Ursulina That, for and in consideration of the love and affection which the DONOR has for the DONEE, and of the faithful services the latter has rendered in the past to the former, the said DONOR does by these presents transfer and convey, by way of DONATION, unto the DONEE the property above, described, to become effective upon the death of the DONOR; but in the event that the DONEE should die before the DONOR, the present donation shall be deemed rescinded and of no further force and effect. On May 26, 1986 - Leocadia, et al [heirs of Celestina] filed a complaint against Ursulina alleging that the donation was a disposition mortis causa which failed to comply with the provisions of the Civil Code regarding formalities of wills and testaments, hence, it was void. Ursulina alleged that the donation contained in the deed is inter vivos as the main consideration for its execution was the donor's affection for the donee. Issue: Whether the donation is inter vivos or mortis causa. Held: Mortis Causa. The distinguishing characteristics of a donation mortis causa are the following: 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 (full or naked) and control of the property while alive; That before his death, the transfer should be revocable by the transferor at will, ad nutum; but revocability may be provided for indirectly by means of a reserved power in the donor to dispose of the properties conveyed; That the transfer should be void if the transferor should survive the transferee. In the subject donation, there is nothing therein which indicates that any right, title or interest in the donated properties was to be transferred to Ursulina prior to the death of Celestina. The phrase "to become effective upon the death of the DONOR" admits of no other interpretation but that Celestina intended to transfer the ownership of the properties to Ursulina on her death, not during her lifetime. More importantly, the provision in the deed stating that if the donee should die before the donor, the donation shall be deemed rescinded and of no further force and effect shows that the donation is a postmortem disposition. One of the decisive characteristics of a donation mortis causa is that the transfer should be considered void if the donor should survive the donee. To classify the donation as inter vivos simply because it is founded on considerations of love and affection is erroneous. That the donation was prompted by the affection of the donor for the donee and the services rendered by the latter is of no particular significance in determining whether the deed constitutes a transfer inter 10

vivos or not, because a legacy may have an identical motivation. In other words, love and affection may also underline transfers mortis causa. Ganuelas vs Cawed, 4-24-03 ooooooooooOOOOOoooooooooo end

*RECB 11

PROPERTY** Are power barges considered personal property? FACTS : NPC entered into a lease contract with Polar Energy, Inc. over 3x30 MW diesel engine power barges moored at Balayan Bay in Calaca, Batangas. The contract was for a period of five years which states that NAPOCOR shall be responsible for the payment of all real estate taxes as provided in Article 10 of Energy Conversion Agreement. Polar Energy, Inc. assigned its rights under the Agreement to FELS, who later on received an assessment of real property taxes on the power barges and referred the same to NPC, reminding it of its obligation to pay. NPC filed manifestation, stating that power barges are not real property subject to real property assessment. FELS also contends that notwithstanding the barges being real properties, they are exempt from taxation. ISSUE: Whether power barges are considered personal properties. HELD: No. As found by the appellate court, the CBAA and LBAA, power barges are real property and are thus subject to real property tax. Tax assessment by the tax examiners are presumed correct and made in good faith; with tax payer having the burden of proving otherwise. Moreover, Article 415 (9) of the New Civil Code provides that docks and structures which, though floating, are intended by their nature and object to remain at a fixed place on a river, lake or coast are considered immovable property. Thus, power barges are categorized as immovable property by destination, being in the nature of machinery and other implements intended by the owner for an industry or work which may be carried on in a building or on a piece of land and which tend directly to meet the needs of said industry or work. FELS ENERGY, INC. vs. THE PROVINCE OF BATANGAS G.R No. 168557, February 16, 2007 Schools, public markets, cemeteries built by local government units are in the nature of patrimonial property. FACTS: The Municipal Government of Paniqui, Tarlac built a school, a public market, and a cemetery on an untitled parcel of land. OCTs were issued in the name of the municipality. Pursuant to a Petition for Reconstitution filed by the municipality, the RTC ordered the cancellation and reconstitution of the same as TCTs, registered in the name of the municipality. Petitioners, in seeing that the cancelled OCTs named their ascendants as former owners of the land as its indigenous inhabitants, filed a case against respondents and prayed for the cancellation of the TCTs and for reconveyance of the lands, alleging that their ascendants were not given the opportunity to appear or answer and present their side at the cadastral proceedings involving the subject properties. ISSUE: May the Municipality have the land registered in its name? HELD: YES. Properties of local government units are limited to properties for public use and patrimonial property. Property for 12

public use can be used by everybody, even by strangers or aliens, in accordance with its nature; but nobody can exercise over it the rights of a private owner. A school, a public market, and a cemetery were built upon the subject property. Schools, public markets and cemeteries are not for the free and indiscriminate use of everyone. The government regulates the determination of the persons allowed to study in such schools, or put up stalls in the public market, or bury their dead in public cemeteries. The subject property is patrimonial property. IN THE MATTER OF REVERSION/RECALL OF RECONSTITUTED OCT NO. 0-116 V. REGISTRY OF DEEDS OF TARLAC, ET.AL. G.R. No. 171304; October 10, 2007 Reclaimed lands are part of the public domain, as such, they cannot be levied and sold at public auction. FACTS: The Ministry of Public Works and Highways (Ministry) reclaimed from the sea a 21-hectare parcel of land in Iloilo City and constructed thereon the Iloilo Fishing Port Complex (IFPC). Upon completion, the Ministry turned over IFPC to the Philippine Fisheries Development Authority (PFDA). The City of Iloilo assessed the entire IFPC for real property taxes. The assessment remained unpaid. To satisfy the tax delinquency, the City of Iloilo scheduled the sale at public auction of the IFPC. PFDA filed an injunction case but the parties subsequently agreed to avail of administrative proceedings instead. ISSUE: May the IFPC be sold at public auction in order to satisfy the tax liabilities of PFDA? HELD: NO. PFDA is not a GOCC but an instrumentality of the national government which is generally exempt from payment of real property tax. However, said exemption does not apply to the portions of the IFPC which the PFDA leased to private entities. With respect to these properties, the PFDA is liable to pay real property tax. The IFPC, a property of public dominion, cannot be sold at public auction to satisfy the tax delinquency. The tax delinquency should be satisfied through means other than the sale at public auction. PHILIPPINE FISHERIES DEVELOPMENT AUTHORITY V. CA G.R. No. 169836, July 31, 2007 Absence of proof that the land sought to be registered is alienable and disposable, the same is presumed to be inalienable land of the public domain. FACTS: In 1993, Lourdes Jardeleza executed a Deed of Absolute Sale selling to petitioner a parcel of unregistered land. Petitioner then filed a verified Application for Registration over the subject property but the same was opposed by respondent Republic of the Philippines. The RTC ordered the issuance of title in her name. On appeal, the CA reversed the decision holding that other than petitioners own general statements and tax declarations, no other evidence was presented to prove her possession of the property for the period required by law. ISSUE: May petitioner register the subject property in her name? HELD: NO. The applicant for registration of a parcel of land must prove 1) possession of 13

the subject land under a bona fide claim of ownership from 12 June 1945 or earlier; and 2) the classification of the land as alienable and disposable land of the public domain. The petitioner failed to discharge the burden of proof imposed on her by law. The Deed of Sale did not state the duration of the time during which the vendor (or her predecessors-in-interest) possessed the subject property in the concept of an owner. Petitioners presentation of tax declarations of the subject property, as well as tax receipts of payment of the realty tax, are of little evidentiary weight and do not necessarily prove ownership. The evidence failed to prove that the subject property is alienable and disposable; the same must still be considered as inalienable land of public domain which belongs to the state and cannot be the subject of registration. FERNANDA ARBIAS V. CA AND REPUBLIC G.R. No. 173808, September 17, 2008 What is the nature of accession? FACTS : Respondents filed a complaint against petitioners for Cancellation of Tax Declaration and Recovery of Possession with Damages (accion publiciana) involving a lot and another lot abutting the titled property. According to the respondents, the property was declared for taxation purposes under their names and the corresponding taxes were paid thereon. The petitioners occupied a portion of the property fronting the China Sea, as well as the lot within the salvage area. The respondents pointed out that whatever alleged claims the petitioners had on the property was acquired through a Deed of Waiver of Rights executed in 1986 in their favor by another squatter Alfonso Bactad. For their part, the petitioners claimed that they had been in possession of the property since 1984 and declared the property for taxation purposes under their names. They filed an application for miscellaneous sales patent which was certified as alienable and disposable land by the barangay captain. ISSUE: Whether petitioners are entitled to the possession of the area outside the titled property of the respondents and is within the Salvage Zone. HELD: No. Petitioners should be ejected even if the portion occupied by them is in the salvage zone. The ownership of property gives the right by accession to everything which is produced thereby, or which is incorporated or attached thereto, either naturally or artificially (Article 440, Civil Code). Accession is the right of the owner of a thing to the products of said thing as well as to whatever is inseparably attached thereto as an accessory. While it is true that the salvage zone cannot be the subject of commerce, the adjoining owner thereof, the respondents in this case, have the priority to use it. Moreover, the law provides the different modes of acquiring ownership and accession in not among the modes of acquiring ownership. Accession is a right implicitly included in ownership, without which it will have no basis or existence. In general, the right to accession is automatic (ipso jure), requiring no prior act on the part of the owner of 14

the principal. SPOUSES PELAGIO GULLA and PERLITA GULLA vs. HEIRS OF ALEJANDRO LABRADOR (G.R No. 149418 July 27, 2006) Who shall own that portion of land segregated through the formation of a new creek by man-made means? FACTS: Petitioners and respondents are the owners of two (2) adjoining parcels of land. The two properties have a common boundary: a creek which ran from south to north, such that petitioners property was bounded by said creek on the west, while that of respondents was bounded by the same creek on the east. Due to constant heavy rains and flood, water from the creek overflowed and destroyed the irrigation canal located at the north of the property in dispute. In order to minimize the damage to the irrigation canal, the National Irrigation Administration (NIA) diverted the course of the creek so rain water will not go directly to the irrigation canal. As a result, the course of the creek which originally ran from south to north and which used to separate the respective properties of the parties was instead diverted to run from south to northwest, passing through the middle portion of the respondents property and resulting in the formation of a new creek. Consequently, the NIA asked the permission of Manuel Leonen, one of the herein respondents, to allow it to use the new creek as an irrigation canal. Manuel Leonen consented. The portion segregated by the new creek, consisting of 1, 336.5 square meters, is the strip of land subject of this controversy. Petitioners contend that no new creek was created and that the present creek is the same creek which bounds their property on the west, thus making them the owners of the property in question. ISSUE: Whether the petitioners have the right over the disputed property. HELD: No. The evidence on record clearly establish that there used to be an old creek originally running from south to north and separating the property of the petitioners from that of the respondents. Then, due to expediency and necessity of protecting the irrigation canal in the area, the course of that creek was subsequently diverted to run from south to northwest, cutting through the property of the respondents. Hence, the portion segregated (the subject property) from respondents land as a result of such diversion continues to be their property and they shall retain ownership of the same. MR. AND MRS. ALEJANDROM PANDODEN vs. ISABEL LEONON, ET AL. G.R No. 138939, December 6, 2006 Are lessees builder in good faith to entitle them to a right of reimbursement under Art. 448 of the Civil Code and the consequent right of retention? FACTS: Petitioners, dealers of Pilipinas Shell, have been in possession of a parcel of land leased to it by respondent under a 10-year Lease Agreement. When the lease contract expired, petitioners remained in possession of the property on which they built improvements despite demands to vacate from the respondent. Hence, respondents filed a 15

complaint for ejectment. Petitioners contend that neither respondent nor his agents performed any act to prevent them from introducing the improvements on the leased premises. Article 453 of the New Civil Code which provides that if there was bad faith not only on the part of the person who built, planted or sowed on the land of another, but also on the part of the owner of such land, the rights of one and the other shall be the same as though both had acted in good faith should be applied. Petitioners thus conclude that being builders in good faith, until they are reimbursed of the Two Million Peso-value of the improvements that had introduced on the property, they have the right of retention or occupancy thereof. ISSUE: Whether petitioners are builders in good faith and are thus entitled to the full value of the improvements they had introduced on the property. HELD: No, Petitioners were allowed only to occupy the property because they are dealers of Pilipinas Shell, therefore considered as agents of Pilipinas Shell. The provision on lease under the New Civil Code should be applied. The right of the lessor upon termination of a lease contract with respect to useful improvements of the leased property by a lessee is covered by Art. 1678. This provides that the lessor upon termination of the lease shall pay the lessee one-half of the value of the improvements at that time and should the lessor refuse to reimburse said amount, the lessee may remove the improvements, even though the principal thing may suffer damage thereby. Jurisprudence dictates that Article 448 covers only cases in which the builders believe themselves to be the owners of the land or at least have a claim of title thereto and not when the interest is merely that of a holder, such as a tenant. Hence, it is the lessor who is given the option, upon termination of the lease contract either to appropriate the useful improvements by paying one-half of their value at the time or to allow the lessee to remove the improvements. SAMUEL PARILLA, et al. vs. DR. PROSPERO PILAR G.R No. 167680, November 30, 2006 A planter in good faith cannot remove the improvements he introduced on the land he purchased. FACTS: Danilo Reyes bought a parcel of land from Regina Castillo in whose name the land was registered. Reyes then introduced improvements and planted fruit trees thereon. He applied for the transfer of the title in his name. It turned out that a portion of the land is part of the timberland of Oriental Mindoro, considered as non-alienable public land; it cannot be subject to any disposition or acquisition under existing law, nor can it be registered. Reyes filed a Motion to Remove Improvements introduced on the property. He averred that he occupied in good faith the subject land and that he is likewise a sower and planter in good faith. ISSUE: Can Reyes remove the improvements he made on the land? HELD: NO. To allow Reyes to remove the fruit-bearing trees now full-grown on the subject land, even if he is 16

legally entitled to do so, would violate the implicit mandate of Article 547 of the Civil Code. The options Reyes may exercise under Arts. 448 and 546 of the Civil Code have been restricted. It is no longer feasible to permit him to remove the trees he planted. The only equitable alternative would be to order the Republic to pay Reyes the value of the improvements he introduced on the property. REPUBLIC V. HON. NORMELITO BALLOCANAG AND REYES, G.R. No. 163794, November 28, 2008 The landowner can make a choice either by appropriating the building by paying the proper indemnity or obliging the builder to pay the price of the land. FACTS: Since 1910, petitioners and their predecessors-ininterest have been occupying a lot in Laguna. They built their houses and apartment building thereon. In 1982, respondents found that they were the true owners of the lot occupied by petitioners. In 1988, respondents filed a Complaint for Recovery of Possession with Damages against petitioners, alleging that they were the lawful owners of the lot as evidenced by a Certificate of Title issued by the Register of Deeds of Laguna. On the other hand, petitioners alleged that they were the owners of the lot as shown by the TCT issued by the Register of Deeds of Laguna and that respondents action was barred by prescription. The result of the resurvey showed that the lot was registered in the name of Margarita Almada, respondents predecessor-in-interest. It was also discovered that the lot covered by the TCT was not the lot presently occupied by petitioners. ISSUES: 1] Is the Complaint for Recovery of Possession barred by prescription? 2]Are petitioners builders in good faith? HELD: 1] NO. Title to registered land shall not be acquired by prescription or adverse possession. Neither can prescription be allowed against the hereditary successors of the registered owner, because they step into the shoes of the decedent and are merely the continuation of the personality of their predecessor-in-interest. The respondents are the lawful owners of the lot and thus should be placed in possession thereof. 2] YES. Petitioners and their predecessor-in-interest were in good faith when they built their houses and apartment building on the lot. Thus, Art. 448, 546 and 548 of the NCC apply in this case. The landowner can make a choice either by appropriating the building by paying the proper indemnity or obliging the builder to pay the price of the land. OCHOA V. APETA, ET. AL, G.R. No. 146259, September 13, 2007 The express consent by the landowner to allow relatives to stay on his property to enjoy the fruits thereof and to build their own house and stay thereat as long as they like creates a usufruct which is extinguished upon the fulfillment of a resolutory condition and the usufructuary is not entitled to a reimbursement for the improvements made on the property. FACTS: Petitioner acquired the subject property initially for the purpose of 17

letting respondent Arlene Pernes, her niece, move from Mandug to Davao City proper, but later wanted the property to be also available to any of her kins. She made known this intention in a document. Following her retirement from the USA, she came back to the Philippines to stay with the respondents on the house they built on the subject property. In the course of time, their relations turned sour. Petitioner sued for unlawful detainer against the respondents. Respondents interposed petitioners written declaration, wherein she expressly signified her desire for the spouses to build their house on her property and stay thereat for as long as they like. The petitioner asserts that the Civil Code provision on usufruct applies in the case at bar and that the usufructuary rights of the respondents had already ceased. ISSUES: 1] Whether the Civil Code provisions on usufruct apply in the instant case; 2] If in the affirmative, whether the usufruct may be deemed to have been extinguished; and 3] Whether respondents are entitled to reimbursement for the improvements introduced. HELD: 1] Yes. It is undisputed that petitioner, in a document dated July 21, 1986, made known her intention to give respondents and her other kins the right to use and to enjoy the fruits of her property. The respondents were given the right to build their own house on the property and to stay thereat as long as they like. The established facts undoubtedly gave respondents not only the right to use the property but also granted them the right to enjoy the fruits thereof; 2] Yes. Article 603 (2) provides that usufruct is extinguishedby the fulfillment of any resolutory condition provided in the title creating the usufruct. As provided in the July 21, 1986 document, the occurrence of any of the following: the loss of the atmosphere of cooperation, the bickering or the cessation of harmonious relationship between/among kin constitutes a resolutory condition which, by express wish of the petitioner, extinguishes the usufruct. The continuing animosity between the petitioner and respondents, and the violence and humiliation she was made to endure, despite her advanced age and frail condition, are enough factual bases to consider the usufruct as having been terminated; 3] No since, the usufructuary might improve the owner out of his property. MERCEDES MORALIDAD vs. SPS. DIOSDADO PERNES and ARLENE PERNES GR. No. 152809, August 3, 2006 A lessee is neither a builder in good faith nor in bad faith. His rights are governed by Art. 1678 of the Civil Code under which the lessor has the option of paying one-half of the value of the improvements which the lessee made in good faith, which are suitable for the use for which the lease is intended, and which have not altered the form and substance of the land. The lessee may remove the improvements should the lessor refuse to reimburse. FACTS: Respondent leased a portion of the Nayong Pilipino Complex to petitioner Sulo sa Nayon, Inc. for the construction and 18

operation of a hotel building, the Philippine Village Hotel. The lease was for an initial period of 21 years, renewable for a period of 25 years upon due notice in writing to respondent at least 6 months before its expiration. After the expiration of the original contract, petitioner sent respondent a letter notifying the latter of their intention to renew the contract. The parties agreed to the renewal of the contract for another 25 years and for payment by petitioner of monthly rental at the rate of P20.00 per sq.m, which shall be subject to an increase of 20% at the end of every 3 years. Petitioners defaulted in the payment of their monthly rental. Respondent repeatedly demanded petitioners to pay the arrears and to vacate the premises but such demand fell on deaf ears. Respondent then filed a complaint for unlawful detainer against petitioner. ISSUE: Are Arts. 448 and 546 of the Civil Code applicable in the instant case? HELD: NO. Article 448, in relation to 546 concerning refund of necessary expense, apply only to a case where one builds, plants, or sows on land in which he believes himself to have a claim of title, and not to lands where the only interest of the builder, planter or sower is that of a holder, such as tenant. Introduction of valuable improvements on the leased premises does not give the petitioners the right of retention and reimbursement which rightfully belongs to a builder in good faith. Otherwise, such a situation would allow the lessee to easily improve the lessor out of its property. A lessee is neither a builder in good faith nor in bad faith. His rights are governed by Art. 1678 of the Civil Code under which the lessor has the option of paying one-half of the value of the improvements which the lessee made in good faith, which are suitable for the use for which the lease is intended, and which have not altered the form and substance of the land. The lessee may remove the improvements should the lessor refuse to reimburse. SULO SA NAYON, INC. V. NAYONG FILIPINO FOUNDATION, G.R. No. 170923, January 20, 2009 Accrued interest yield on a bank deposit is a form of accession, forming part of the principal, and therefore belongs to the owner of the principal amount. FACTS: Petitioner, represented by the Toll Regulatory Board (TRB), filed a complaint for expropriation against landowners whose properties would be affected by the construction, rehabilitation and expansion of the North Luzon Expressway. Respondent Holy Trinity Realty and Development Corporation (HTRDC) was one of the affected landowners. TRB filed an Urgent Ex-Parte Motion for the issuance of a Writ of Possession, manifesting it deposited a sufficient amount to cover the payment of 100% of the zonal value of the affected properties with the Land Bank of the Philippines (LBP). The HTRDC filed a Motion to Withdraw Deposit including the interest which accrued thereon. The RTC issued an Order directing the manager of LBP-South Harbor to release the deposit in favor of HTRDC. The RTC reversed its ruling prompting the HTRDC to 19

appeal the decision to the CA. The CA ruled that HTRDC is entitled to the interest which accrued on the amount deposited in the expropriation account by virtue of accession. The Republic contends HTRDC is entitled only to the zonal value of the expropriated property, nothing more and nothing less. ISSUE: Is HTRDC entitled to the interest which accrued on the amount deposited in the expropriation account by virtue of accession? HELD: YES. The right of accession is conferred by ownership of the principal property. The principal property is part of the deposited amount in the expropriation account. Since HTRDC is entitled to and is the owner of the principal amount deposited by TRB, the interest yield, as accession, in a bank deposit should likewise pertain to it as the owner of the money deposited. REPUBLIC V. HOLY TRINITY REALTY DEVELOPMENT CORP. G.R. No. 172410, April 14, 2008 A person acquiring property through fraud becomes, by operation law, a trustee of an implied trust for the benefit of the real owner of the property. When an action for reconveyance is nonetheless filed, it would be in the nature of a suit for quieting of title, an action that is imprescriptible. FACTS: The late Dominga Lustre owned a residential lot which was mortgaged to the spouses Santos. Dominga then sold the property to Natividad. The cancellation of the mortgage and the sale of the property were both inscribed in the title. Thereafter, the spouses Santos transferred the property, by way of sale, to their son Froilan. The heirs of Dominga filed a complaint for Declaration of Inexistence of Contract, Annulment of Title, Reconveyance and Damages against Froilan, averring that the sale of the property to Natividad was simulated as Domingas signature was forged and that the spouses Santos also simulated another Deed of Sale transferring the property to Froilan. Petitioners allege that the respondents right of action had prescribed. ISSUE: Is respondents action barred by prescription? HELD: NO. The action for reconveyance on the ground that the certificate of title was obtained by means of a fictitious deed of sale is an action for the declaration of its nullity, which does not prescribe. A person acquiring property through fraud becomes, by operation law, a trustee of an implied trust for the benefit of the real owner of the property. An action for reconveyance based on an implied trust prescribes in 10 years. The prescriptive period applies only if there is an actual need to reconvey the property as when the plaintiff is not in possession of the property. Otherwise, if plaintiff is in possession of the property, prescription does not commence to run against him. When an action for reconveyance is nonetheless filed, it would be in the nature of a suit for quieting of title, an action that is imprescriptible. SPS. SANTOS, ET. AL. V. HEIRS OF DOMINGA LUSTRE G.R. No. 151016, August 6, 2008

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The real owner is deemed to be in actual possession of a property despite the presence of a caretaker. It is not necessary that the owner of a parcel of land should himself occupy the property as someone in his name may perform the act. If the person claiming to be owner of the property is in actual possession thereof, the right to seek reconveyance, which in effect seeks to quiet title, does not prescribe. FACTS: A parcel of land, originally registered in petitioner Lucias name, was later sold to Angelica, her daughter. Lucia continued to pay the real estate due on the subject lot. She then designated Vivian as caretaker of the subject lot. Vivian built a house on it and resided therein. When Angelica died, private respondents executed an Extra-Judicial Settlement of her estate which included the subject lot. The title was transferred to the respondents. Lucia demanded the return of the lot from respondents to no avail. She filed a Complaint against respondents for the declaration of nullity of Deed of Absolute Sale, annulment of the extra-judicial settlement and partition of estate and reconveyance of land title with damages. ISSUE: Is the complaint filed by Lucia meritorious and not barred by prescription? HELD: YES. Lucia is the rightful owner of the land; Angelica or respondents did not, attempt to exercise any act of dominion over it. Lucia was in actual possession of the property through Vivian, the caretaker it is not necessary that the owner of a parcel of land should himself occupy the property as someone in his name may perform the act. Lucia also paid the realty taxes. The complaint is not barred by prescription an action for reconveyance prescribes in 10 years, the reckoning point of which is the date of registration of the deed or the date of issuance of the certificate of title over the property. If the person claiming to be owner of the property is in actual possession thereof, the right to seek reconveyance, which in effect seeks to quiet title, does not prescribe. One in actual possession of a piece of land claiming to be the owner thereof may wait until his possession is disturbed or his title is attacked before taking steps to vindicate his right. His undisturbed possession gives him the continuing right to seek the aid of a court of equity to ascertain the nature of the adverse claim of a third party and its effect on his title, which right can be claimed only by one who is in possession. Thus, considering that Lucia continuously possessed the subject lot, her right to institute a suit to clear the cloud over her title cannot be barred by the statute of limitations. LUCIA CARLOS ALINO V. HEIRS OF ANGELICA LORENZO G.R. No. 159550, June 27, 2008 The intention to abandon implies a departure, with the avowed intent of never returning, resuming, or claiming the right and the interest that have been abandoned. FACTS: Since 1955, spouses Francisco had been in the possession of the subject property. They allege that in 1989, they borrowed P50,000 from petitioner Eugenia Castellano and in return, 21

Eugenia will cultivate and possess the property until full payment of the loan and that in 1992, they offered to pay the loan but Eugenia refused to accept the payment. They learned that Eugenia was able to secure emancipation patent and certificate of title over the subject property in the name of Erlaine, her son, without their knowledge and consent. The spouses filed a petition for cancellation of the patent before the DARAB. The petitioners argue that spouses Francisco informed them that they would no longer redeem the land and thus a transfer was later initiated. ISSUE: Did the respondent-spouses abandon their rights over the land when they surrendered possession of the same to Eugenia in consideration of the loan? HELD: NO. Abandonment requires: (1) a clear and absolute intention to renounce a right or claim or to abandon a right or property; and (2) an external act by which that intention is expressed or carried into effect. The intention to abandon implies a departure, with the avowed intent of never returning, resuming, or claiming the right and the interest that have been abandoned. It was not shown that spouses Francisco had a clear and absolute or irrevocable intent to abandon the land. Their surrender of possession did not amount to abandonment; there was an obligation on the part of Eugenia to return possession to the spouses upon full payment of the loan. EUGENIA CASTELLANO, ET. AL. V. SPS. FRANCISCO, ET. AL, G.R. No. 155640, May 7, 2008 A cloud which may be removed by suit to quiet title is not created by mere verbal or parol assertion of ownership of or an interest in property, where there is a written of factual basis for the asserted right. FACTS: Petitioners claim that they and their predecessors-in-interest have been in possession of the disputed parcel of land since time immemorial. When petitioners decided to apply for the judicial registration of the property, they found out that portions of the land have been occupied by respondents. Petitioners filed a complaint for quieting of title, averring that the allegations of spouses Calderon that they purchased their property and Macapagals claim that he applied for a Free Patent were judicial admissions which they consider as cloud upon their interest in the disputed property. ISSUE: May a verbal or parol assertion be considered as a cloud in the title? HELD: NO. A cloud which may be removed by suit to quiet title is not created by mere verbal or parol assertion of ownership of or an interest in property, where there is a written of factual basis for the asserted right. NO. Petitioners must first establish their legal or equitable title to, or interest in the real property. A claim of right based on acquisitive prescription or adverse possession constitutes a removable cloud on title. While petitioners alleged that respondents claim of adverse possession casts a cloud on their interest in the land , such allegations has not been proved since the alleged falsified documents relied upon by respondents to justify their possession were merely marked as exhibits but were never 22

formally offered in evidence by petitioners. EFREN TANDOG, ET. AL. V. RENATO MACAPAGAL, ET. AL, G.R. No. 144208, September 11, 2007 A co-owner is entitled to sell his undivided share; a sale of the entire property by a co-owner without the consent of the other co-owners is not null and void. Only the rights of the co-owner-seller are transferred, making the buyer a co-owner of the property. FACTS: Two lots in LapuLapu City were adjudicated in 4 equal shares. The heirs of Tito Dignos were awarded share in the two lots, but they sold the entire two lots to the Civil Aeronautics Administration (CAA) without the knowledge of respondents, adjudicatees of the portion of the two lots. CAAs successor-in-interest, the Mactan Cebu International Airport Authority (MCIAA), erected a security fence traversing one of the lots and relocated a number of families thereon. Respondents filed a Complaint for Quieting of Title against MCIAA, alleging they have not sold, alienated or disposed their shares in the lots and that the existence of tax declarations in favor of petitioners would cast a cloud on their titles. The RP, represented by the MCIAA, maintained that from the time the lots were sold to CAA, it had been in open, continuous, exclusive, and notorious possession thereof; through acquisitive prescription, it had acquired valid title to the lots since it was a purchaser in good faith and for value; and assuming that it did not have just title, it had by, possession for over 30 years, acquired ownership thereof by extraordinary prescription. ISSUE: Do respondents have the right to recover the lots? HELD: YES. A co-owner is entitled to sell his undivided share; a sale of the entire property by a co-owner without the consent of the other co-owners is not null and void. Only the rights of the co-owner-seller are transferred, making the buyer a co-owner of the property. Petitioners insistence that it acquired the property through acquisitive prescription, if not ordinary, then extraordinary, does not lie. REPUBLIC V. HEIRS OF DIGNOS-SORONO, ET. AL., G.R. No. 171571, March 24, 2008 The right to seek partition is imprescriptible and cannot be barred by laches. The only exception is when a co-owner repudiates the coownership. FACTS: Don Fabian married twice and had 8 children, 4 from each union. After the death of his first wife and during the early part of his second marriage, he filed an intestate proceeding for the estate of his deceased first wife, Soledad Monteroso. The intestate estate of Soledad was partitioned and distributed to her 4 children in equal shares. The heirs of Benjamin Monteroso, son of Don Fabian and Soledad, filed a complaint against their uncle, Tirso Monteroso, alleging that their uncle, to whom the land allotted to their father was entrusted, refused to surrender the same when they demanded delivery upon their reaching the age of majority. Tirso countered that the portion pertaining to Benjamin was in the 23

possession of their sister, Soledad Monteroso-Cagampang. Tirso, in turn, filed a Complaint for Partition and Damages with Receivership against his stepmother, Sofia Pendejito, and all his full and half-siblings and/or their representatives. ISSUE: Is the cause of action of Tirso one for partition and hence imprescriptible? HELD: YES. Partition is the proper remedy to Tirso who is a co-owner of the subject properties by virtue of his being a compulsory heir of Don Fabian. Acquisitive prescription or laches does not lie against Tirso, the general rule being that prescription does not run against a co-owner or co-heir. The right to seek partition is imprescriptible and cannot be barred by laches. The only exception is when a co-owner repudiates the co-ownership. MONTEROSO V. COURT OF APPEALS, G.R. No. 105608, April 30, 2008 A co-owner may file an action for recovery of possession against a co-owner who takes exclusive possession of the entire co-owned property. FACTS: During their marriage, Feliciano Sr. and Lorenza acquired a 120 sq. m. lot, upon which they built their conjugal home. After the death of Lorenza, her heirs failed to partition their hereditary shares in their inheritance. Paz Lachica, with whom Feliciano, Sr. was married 2 days before his death, is the owner of a 192 sq.m. lot. She later sold 40.10 sq. m. of the property leaving her with only 151.9 sq. m. After Feliciano Sr. died, his heirs failed to partition their hereditary shares in their inheritance. In 1969, Lachica was issued a Tax Declaration covering the remaining 151.9 sq. m. of lot. A new tax declaration was issued increasing the 151.9 sq. m. lot to 336 sq. m., which included the 120 sq. m. property previously owned by Feliciano, Sr. and Lorenza. Lachica sold the 336 sq. m. parcel of land to petitioners. Charlito Cojas application for the issuance of title was opposed by respondents, heirs of Feliciano, Sr. and they filed an action for recovery of possession and ownership against petitioners. They claim to be the owners of the subject property being the true and lawful heirs of Feliciano Sr. and Lorenza. Lachica alleged she acquired the property before her marriage to Feliciano Sr. and that she had been in actual and physical possession of the same for more than 15 years before she sold the property to the petitioners. ISSUE: Do the respondents have a right over the subject land? HELD: YES. The 120 sq. m. land less the hereditary share of Lachica belongs to respondents. Considering that Lachica, the predecessor-in-interest of petitioners, was a co-owner of the subject property; and considering further that partition of the property is wanting, this Court is precluded from directing the petitioners to return specific portions of the property to respondents. In lieu thereof, the co-ownership between the parties over the subject property is recognized. A co-owner may file an action for recovery of possession against a co-owner who takes exclusive possession of the entire co-owned property. The only effect of such action is recognition of the co-ownership. Courts cannot 24

proceed with the actual partitioning of the co-owned property. Judicial or extra-judicial partition is necessary to effect physical division of the subject property. SPS. COJA V. COURT OF APPEALS, ET. AL, G.R. No. 151153, December 10, 2007 The law limits the term of a co-ownership to ten years, but this term limit may nevertheless be extended. FACTS: The subject land is registered in the name of Timoteo Ungab. Petitioner Anita Ungab is the only child of Timoteo. The heirs of Timoteos siblings filed a complaint for partition, accounting and reconveyance of the subject land. Before trial, the parties submitted a written compromise agreement, which was approved by the court. The parties did not have the land partitioned but divided the proceeds thereof in accordance with the decision. Anita later on refused to give respondents their respective shares. Respondents then filed against petitioners a complaint for recovery of possession, partition enforcement of compromise agreement. Petitioners assert that Anita is the sole owner of the land. Respondents counter that they are not claiming as heirs of Timoteo, but as his co-owners, alleging that the land was governed by a state of co-ownership even before the title was issued as shown by the Affidavit of Acknowledgment signed by Timoteo, Anita herself, and her mother Aurelia. ISSUE: Are respondents co-owners of the subject land? HELD: YES. The execution of the Affidavit of Acknowledgment and the compromise agreement prove the intention to establish an express trust wherein the respondents, as trustors, reposed their confidence on petitioner Anita and her mother, as trustees, that they will hold the land subject of the co-ownership. Petitioners argue that the co-ownership was already extinguished because the Civil Code provides that an agreement to keep a thing undivided shall not exceed ten years. Indeed, the law limits the term of a co-ownership to ten years, but this term limit may nevertheless be extended. ANITA UNGAB-VALEROSO, ET. AL. V. AMANCIA UNGAB-GRADO, ET. AL., G.R. No. 163081, June 15, 2007 Possession may be exercised in ones own name or in that of another. FACTS: Respondents filed a Petition for Reconstitution of the original of TCT No. 335986 and Issuance of the corresponding Owners Duplicate thereof over a lot, alleging that she was the owner in fee simple of the said property. Petitioner alleged that the court did not acquire jurisdiction to hear the petition because it was proven that respondent was no longer in possession of the lot; it was Editha, her Attorney-in-Fact, who was in possession thereof. ISSUE: Is respondent in possession of the lot in question? HELD: YES. The fact that Editha testified that it was her family who were residing on the subject lot did not negate the statement in the petition for reconstitution that it was respondent who was in possession thereof. Possession may be exercised in ones own name or in that of 25

another. Editha exercised possession over the land in the name of respondent. REPUBLIC V. LOURDES ALONTE, G.R. No. 162787, June 13, 2008 Possession in good faith ceases the moment defects in the title are made known to the possessors, by extraneous evidence or by suit for recovery of the property by the true owner. Such interruption takes place upon service of summons. A possessor in good faith is entitled to the fruits so long as his possession is not legally interrupted. FACTS: During their lifetime, the spouses Macahilig were the owners of 7 parcels of land. The spouses Macahilig had 7 children, namely: Dionesio, Emeliano, Mario, Ignacio, Eusebio, Tarcela and Maxima. Maxima entered into a Deed of Extra-Judicial Partition with the heirs of her 2 deceased brothers namely: Mario and Eusebio, over several parcels of land owned by her parents. One of these land was an irrigated riceland which, per the Deed of Partition, was divided between heirs of Mario and Eusebio. Subsequently, the riceland was sold by Maxima to petitioners. Respondents then filed an action for reconveyance against petitioners alleging that the Deed of Sale was null and void since Maxima had no right to sell the same as she was not the owner thereof. Petitioners claimed that they were possessors in good faith and that under Art.544, a possessor in good faith was entitled to the fruits received before the possession is legally interrupted; thus, if indeed petitioners are jointly and severally liable to respondents for the produce, of the subject land, the liability should be reckoned only for 1991 and not 1984. ISSUE: Are petitioners contentions meritorious? HELD: YES. Possession acquired in good faith does not lose this character, except when facts exist which show that the possessor is not unaware that he possesses the thing improperly or wrongfully. Possession in good faith ceases the moment defects in the title are made known to the possessors, by extraneous evidence or by suit for recovery of the property by true owner. Such interruption takes place upon service of summons. A possessor in good faith is entitled to the fruits so long as his possession is not legally interrupted. Petitioners received the summons and the complaint on August 5, 1991; petitioners good faith ceased only on the day they received the summons. Consequently, petitioners should pay respondents 10 cavans of palay per annum beginning August 5, 1991 instead of 1984. DACLAG, ET. SL V. MACAHILIG, ET. AL., G.R. No. 159578, July 28, 2008 Ordinary acquisitive prescription requires possession of things in good faith and with just title for the time fixed by law; without good faith and just title, acquisitive prescription can only be extraordinary in character. Regarding real or immovable property, ordinary acquisitive prescription requires a period of possession of 10 years, while extraordinary acquisitive prescription requires an uninterrupted adverse possession of 30 years. FACTS: Respondents rely on an Affidavit executed 26

by Valentin Raon declaring himself to be the true and lawful owner of the subject property. They claim they built a house thereon where they previously resided. When they were already residing in Manila, fire razed and destroyed the said house. Nonetheless, they continued to visit and pay the real estate taxes thereon. Respondents discovered that the land was already in the name of another. They filed a Complaint claiming ownership over the land. Petitioners claim they are the rightful owners of the land, having acquired the same from their predecessors-in-interest, spouses Alcantara, who in turn bought it from its owner in 1936. Petitioners aver that they had religiously paid the real estate taxes on the property and that in 1977, their predecessor-in-interest filed a Notice of Adverse Claim against Valentin Raon. ISSUE: Did the respondents acquire ownership over the subject property through uninterrupted and adverse possession thereof for 30 years, without need of title or of good faith? HELD: YES. Prescription is a mode of acquiring ownership and other real rights over immovable property. The party who asserts ownership by adverse possession must prove the presence of the essential elements of acquisitive prescription. Acquisitive prescription of real rights may be ordinary or extraordinary. Ordinary acquisitive prescription requires possession of things in good faith and with just title for the time fixed by law; without good faith and just title, acquisitive prescription can only be extraordinary in character. Regarding real or immovable property, ordinary acquisitive prescription requires a period of possession of 10 years, while extraordinary acquisitive prescription requires an uninterrupted adverse possession of 30 years. From the time the Affidavit was executed, prescription began to run against petitioners for it was a repudiation of petitioners legal title. Moreover, respondents occupation of the subject property, without interruption and in the concept of an owner, led to ownership via extraordinary acquisitive prescription. HEIRS OF MARCELINA CRISOLOGO V. RAON, ET. AL., G.R. No. 171068, September 5, 2007 Requisites for quieting of title. FACTS: Inocencio Lucasan and his wife Julianita were the owners of 2 lots in Bacolod City. The Pacific Banking Corporation (PBC) extended a P5,000.00 loan to Lucasan, with Carlos Benares as his co-maker. They failed to pay the loan when it became due and demandable. Consequently, PBC filed a collection case. The RTC rendered a decision ordering Lucasan and Benares to solidarily pay but for their failure to do so, a writ of execution was issued directing the sheriff to levy on the properties owned by Lucasan. The lots were sold at public auction and were awarded to PBC as the highest bidder. The auction sale was not assailed and the property was not redeemed. However, PBC failed to file a petition for consolidation of ownership. Thereafter, Lucasan paid his loans with the mortgagee bank. 27

He also filed a petition for declaratory relief with the RTC seeking confirmation of his rights. The Philippine Deposit Insurance Corporation, as receiver and liquidator of PBC, moved to dismiss the complaint for lack of cause of action. ISSUE: Is the dismissal of petitioners action proper? HELD: YES. Quieting of title is a remedy for the removal of any cloud of doubt or uncertainty with respect to real property. An action may also be brought to prevent a cloud from being cast upon title to real property or any interest therein. To avail of the remedy of quieting of title, two (2) indispensable requisites must concur, namely: (1) the plaintiff or complainant has a legal or an equitable title to or interest in the real property subject of the action; and (2) the deed, claim, encumbrance or proceeding claimed to be casting a cloud on his title must be shown to be in fact invalid or inoperative despite its prima facie appearance of validity or legal efficacy. Unfortunately, the foregoing requisites are wanting in this case. Lucasan can pursue all the legal and equitable remedies to impeach or annul the execution sale prior to the issuance of a new certificate of title in favor of PBC. However, the remedy he had chosen cannot prosper because he failed to satisfy the requisites provided for by law. LUCASAN V. PDIC, G.R. No. 176929, July 4, 2008 What is an action to quiet title? What is sufficient to make out an action to quiet title? FACTS: Spouses Ragasa entered into a contract with Oakland Development Resources Corporation (ODRC) for the purchase in installments of a piece of property. They took possession of the property and resided thereat together with their relatives who continued to occupy the same whenever the plaintiffs would leave for Italy where they both worked. Plaintiffs were able to fully pay for the agreed purchase price of the property. Accordingly, a Deed of Absolute Sale was executed by ODRC, and the original owners copy of its TCT of the Registry of Deeds was accordingly turned over to them. However, despite the execution of the Deed, ODRC failed to cause the transfer of title to plaintiffs. Sometime in March 1999, petitioner Consorcia Ragasa, upon learning that ODRC was no longer functional as a corporate entity, decided to cause the transfer of registration of the propertys TCT. She was surprised to learn from the Registry of Deeds that in 1995, the property in question was sold by defendant Ex-Officio Sheriff to defendants Spouses Roa as the highest bidder. Accordingly petitioners filed a complaint against private respondents and the public respondent Ex Officio Sheriff. Private respondents moved for the dismissal of the complaint on the grounds of prescription and laches. The RTC granted the motion and held that petitioners action was barred by prescription for having been filed more than four years after the registration of the execution sale. ISSUE: Whether the suit petitioners commenced was an action upon an injury to their rights contemplated in Article 1146 of the Civil Code which must be 28

filed within four years. HELD: No. Petitioners complaint was essentially one for quieting of title to real property under Article 476 of the Civil Code. To make out an action to quiet title under the foregoing provision, the initiatory pleading has only to set forth allegations showing that (1) the plaintiff has title to real property or any interest therein and (2) the defendant claims an interest therein adverse to the plaintiffs arising from an instrument, record, claim, encumbrance, or proceeding which is apparently valid or effective but is in truth and in fact invalid, ineffective, voidable, or unenforceable. Thus, the averments in petitioners complaint that (1) they acquired ownership of a piece of land by tradition or delivery as a consequence of sale and (2) private respondents subsequently purchased the same piece of land at an allegedly void execution sale were sufficient to make out an action to quiet title under Article 476. SPS. EDESITO & CONSORCIA RAGASA vs. SPS. GERARDO & RODRIGA ROA, et al. G.R No. 141964, June 30, 2006 When does prescription begin to run in an action to quiet title? FACTS: Plaintiffs father, Enrique Santos, was the owner of the property subject of this action. After his death, they inherited the property. Enrique Santos, during his lifetime, and respondents, after the death of the former, had been in actual, continuous and peaceful possession of the property until 1994 when the Iglesia ni Cristo (INC) barred respondents from fencing their property. Plaintiffs filed a complaint for Quieting of Title and/or Accion Reinvindicatoria against INC. Defendant argues that the very nature of the action to quiet title presupposes that plaintiffs must be in actual and material possession of the property, but it was defendant which had been in possession of the property since 1984 when it acquired title thereon. The action of plaintiffs prescribed in ten years from 1984 when defendant allegedly acquired title over the property. On the other hand, plaintiffs argue that the prescriptive period for the actions should be reckoned from 1996, when defendant claimed ownership over the property and barred plaintiffs form fencing their property, not in 1984 when the TCT was issued by the Register of Deeds in the name of defendant as owner. ISSUE: Whether the action for quieting of title/ accion reinvindicatoria has prescribed. HELD: No. Since the respondents were in actual or physical possession of the property when they filed their complaint against petitioner, the prescriptive period for the reinvindicatory action had not even commenced to run, even if petitioner was able to secure title over the property in 1984. The reason for this is that one who is in actual possession of a piece of land claiming to be the owner thereof may wait until his possession is disturbed or his title is attacked before taking steps to vindicate his right, the reason for the rule being, that his undisturbed possession gives him a continuing right to seek the aid of a court of equity to ascertain and determine the nature of the 29

adverse claim of a third party and its effect on his own title, which right can be claimed only by one who is in possession. IGLESIA NI CRISTO vs. THELMA A. PONFERRADA, et al. G.R No. 168943, October 27, 2006 May a co-owner who was declared in default for failure to file answer be entitled to participate in determining the price of sale and to share in the proceeds thereof upon partition of the property owned in common? FACTS: Petitioner and respondents co-owned two parcels of land. The respondents allege that they informed the petitioner of their desire to have the subject properties partitioned based on the percentage of each co-owners share but petitioner refused. Respondents then filed a complaint for partition of the subject property. Petitioner moved to dismiss this but was denied by the lower court. Petitioner filed a petition for certiorari and prohibition but the same was dismissed by the Court of Appeals. During the pendency of such petition, the lower court, at the instance of the defendants, declared the petitioner in default. The petitioner appealed but was denied by the lower court. A motion for new trial was thereafter filed by the petitioner but was denied. Petitioner insists that the appellate court erred in not reversing the declaration of default despite the fact that she questioned the default order in the petition for review on time and that it was error for the trial court to allow the sale of the entire property in dispute. Respondents argue that petitioner was correctly declared in default because of her obstinate refusal to file an answer despite being ordered to do so by the trial court. They also allege that they cannot be compelled to remain in co-ownership only because of petitioners unjustified refusal to consent to a partition. ISSUE: Whether the order of the court authorizing the sale of the subject property is valid. HELD: No. There are two phases in every action for partition. The first phase is determination of whether a coownership in fact exists and a partition is proper. The second phase commences when it appears that the parties are unable to agree upon the partition directed by the court. In that event, partition shall be done for the parties by the court with the assistance of not more than three commissioners. The proceedings in this case have only reached the first phase. There is no question that a co-ownership exists between petitioner and respondents. To this extent, the trial court was correct in decreeing partition in line with the Civil Code provision that no co-owner shall be obliged to remain in the co-ownership. However, the trial court went astray when it also authorized the sale of the subject properties to a third party and the division of the proceeds thereof as the court conditioned the sale upon the price and terms acceptable to respondents only and adjudicated the proceeds of the sale again only to the respondents. CONSOLACION AUSTRIA vs. CONSTANCIA LICHAUCO, et al., G.R No. 170080, April 4, 2007 30

Possession resulting from a void or illegal acquisition cannot be the basis of prescription against a co-owner. FACTS: The sisters Maria and Felipa inherited from their parents 2 adjoining parcels of land. Maria married Eleuterio Valera, while Felipa, married Fidel Generosa. Maria and Eleuterio were childless, while Felipa and Fidel had three (3) children, namely, Alfonso, Pedro and Florencio. Long after Marias death, Eleuterio married the herein respondent, Pacita Prangan-Valera. Eleuterio executed an affidavit adjudicating unto himself as sole heir the property left behind by Maria. Eleuterio died, survived by his second wife, Pacita. The Generosa brothers executed a Deed of Extrajudicial Partition that they are the sole heirs of Eleuterio. Respondent filed the complaint in this case against them, alleging that when Eleuterio died, respondent continued in possession of the same property until her possession was interrupted when the brothers surreptitiously took possession of the property in 1991 on the basis of a falsified deed; that she filed a criminal complaint for falsification of public document; and that the brothers were convicted in said case and subsequently applied for probation. The brothers basically sought refuge on their claim of prescription, alleging that they have been in possession of the disputed property for more than 20 years. ISSUE: Whether the petitioners are the owners of the property with respect to the awarded to respondent by acquisitive prescription having been in possession thereof for more than 20 years. HELD: No. The positive mandate of Article 494 of the Civil Code conferring imprescriptibility to actions of a co-owner or co-heir against his co-owners or co-heirs should preempt and prevail over all abstract arguments based only on equity. Certainly, laches cannot be set up to resist the enforcement of an imprescriptible legal right, and the herein respondent can validly vindicate her inheritance despite the lapse of time. The herein parties are co-owners of the subject property. In order that title may prescribe in favor of one of the co-owners, it must be clearly shown that he has repudiated the claims of the others, and that they were apprised of his claim of adverse and exclusive ownership, before the prescriptive period begins to run. The petitioners claim they were in possession of the property for more than 30 years appears unsupported. In fact, their own evidence belied their claim of prescription and possession of the property. It was only in 1991, after the death of Eleuterio that they, on the basis of the falsified deed of extrajudicial partition, took possession of the property. As it is, the petitioners could not invoke acquisitive prescription because their mode of acquisition was illegal and void. Ordinary acquisitive prescription requires possession of things in good faith and with just title of the time fixed by law. PEDRO GENEROASA, et al. vs. PACITA PRANGANVALERA G.R No. 166521, August 31, 2006

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Tacit consent by the government coupled with the payment of real property taxes may be the basis of a lawful possession and therefore cannot be summarily disturbed without judicial intervention. FACTS: Sometime in 1942, the spouses Luciano and Consolacion Venturillo occupied a public land and erected thereon a house and paid the required taxes in accordance with the directions of the City Assessors Office. Sometime in 2000, Rowena Venturillo- Sucaldito filed a sales application with the DENR. The inspectors submitted a report recommending the approval of Sucalditos application. No immediate action, however, was taken by respondent City Engineer on the report. Respondent City Engineer asked the petitioners to secure a building permit for the house erected on the lot, after it was shown that said structure had no building permit. The petitioners then hired an engineer who prepared the necessary plans and other documents, which were submitted to the respondent City Engineer. However, they were not issued the building permit. The Zoning Administrator wrote petitioners that the area they were occupying is a road right-of-way. Respondent City Engineer also sent petitioners a Notice of Order of Removal. The petitioners filed a petition for mandamus with a prayer for the issuance of a writ of preliminary injunction but the same was dismissed. ISSUE: Whether petitioners have the lawful right of possession over the land. HELD: Yes. The heirs of Venturillo, through their parents, have continuously possessed and occupied the land on which the house sought to be refurbished stands since 1942. This possession was with the tacit consent and authorization of the City Government. In fact, the City Assessors Office directed the Venturillos to file tax declarations and pay real property taxes thereon which they have consistently complied with. By virtue of the City Governments tacit consent, the Heirs of Venturillo are not squatters on public land but are in lawful possession thereof, including the house subject of the summary demolition order of respondent City Engineer. The Heirs of Venturillo have a clear and unmistakable legal right not to be disturbed in their lawful possession of the property unless the proper judicial tribunal has determined that the same constitutes a nuisance in law. HRS. OF SPS. LUCIANO et al. vs. HON. JESUS V. QUITAIN, et al. G.R No. 157972, October 30, 2006 May the dominant estate allow other persons to enjoy the right way granted to it under the original writ of injunction? FACTS: Petitioner and his wife owned lots in Tali Beach Subdivision, owned by private respondent Far East Enterprises, Inc. and also two parcels of land adjacent to the subdivision. To gain access to the two parcels petitioner has to pass through private respondents subdivision. Private respondent then barricaded the front gate of petitioners property to prevent petitioner and his family from using the subdivision roads to access said 32

parcels. A Complaint for Right of Way with prayer for preliminary prohibitive injunction was filed by petitioner against private respondent. The trial court held that barricading the property to prevent the petitioner from entering it deprived him of his ownership rights and caused irreparable damage and injuries. Accordingly, the writ of preliminary injunction was issued. Petitioner then used the subdivision road to transport heavy equipment and construction materials to develop his property. Consequently, private respondent moved to dissolve the writ claiming that the petitioner violated its right to peaceful possession and occupation of Tali Beach Subdivision. The petitioner moved to clarify the writ. Petitioner prayed that his contractors, visitors, and other representatives be allowed access and persons he has authorized to install power lines over private respondents property. The trial court issued a Joint Resolution amending the original writ. The acts prohibited and allowed under the amended writ amounted to a premature adjudication on the merits of the main case on whether or not petitioner has a right of way, which is still pending before the trial court. Private respondent filed a petition for certiorari with the Court of Appeals, which reinstated the original writ. The petitioner moved for reconsideration, but the same was denied. ISSUE: Whether the original writ established an easement of right of way giving the right of passage not only to the petitioner and his household, but also to his visitors, contractors, construction workers, authorized persons, heavy equipment machinery, and construction materials as well as the installation of power lines. HELD: No. At the time the writ was applied for in 1995, there was still no construction going on in the property. The use of the subdivision roads for ingress and egress of construction workers, heavy equipment, delivery of construction materials, and installation of power lines, are clearly not part of the status quo in the original writ. Under Article 656 of the new Civil Code, if the right of way is indispensable for the construction, repair, improvement, alteration or beautification of a building, a temporary easement is granted after payment of indemnity for the damage caused to the servient estate. In the present case, the trial court found that irrespective of which route petitioner used in gaining access to his property, he has to pass private respondents subdivision. Petitioner may be granted a temporary easement. The temporary easement in the original writ differs from the permanent easement of right of way tried in the main case. However, the law provides that temporary easement is allowed only after the payment o the proper indemnity. Additionally, the installation of electric power lines is a permanent easement not covered by Article 656. Neither can installation of electric power lines be subject to a preliminary injunction for it is not part of the status quo. FAUSTO R. PREYSLER, JR. vs. COURT OF APPEALS, et. al. G.R. No. 158141, July 11, 2006

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Effect of declaration by the court that the titles to the road lots burdened by an easement of right of way are null and void. FACTS: Petitioner filed a complaint against the respondents, praying that the latter be enjoined from preventing the petitioner from passing thru or otherwise making use of three road lots inside Hidden View Subdivision I. These road lots were titled and registered in the name of the petitioner. A separate case for annulment of titles over the road lots was then pending before the courts. The Regional Trial Court issued a writ of preliminary injunction. However, on appeal, petitioners obtain an adverse decision. The Supreme Court, on review, made the writ of preliminary injunction permanent subject to the outcome of the civil case for the annulment of titles over the road lots. The judgment in such civil case concluded that petitioner had fraudulently obtained the titles and declared the Deed of Sale covering the road lots null and void and the certificates of title were thus cancelled. Hence, this Motion for Reconsideration. ISSUE: Whether petitioner lost her right-of-way upon losing the right to the road lots. HELD: Yes. Since it was found that the titles of Borbajo were obtained fraudulently, her right to the road lots ceases as well as her right-of-way by virtue of said titles. A final judgment has been rendered canceling petitioners titles over the road lots. It appears that such decision has been executed. Attached to the Motion for Reconsideration are certified true copies of three (3) Transfer Certificates of Title covering the three (3) road lots which are now registered in the name of Hidden View Subdivision Homeowners Association, Inc. It is also stated in each of these titles that the previous titles in the name of petitioner have accordingly been cancelled by these new titles. Petitioners right to the road lots as well as her right-of-way by virtue of her titles thereto, had ceased as a result of the decision annulling the Deed of Sale. Notably, even the petition itself conceded that until and unless the certificate of title covering these road lots shall have been decreed to be null and void in a direct proceedings instituted for that purpose, the same shall be respected and in case of violation of its use and enjoyment, the registered owner thereof, is entitled to the protection of law. FELICITACION B. BORBAJO vs. HIDDEN VIEW HOMEOWNERS, INC. et al., G.R. No. 152440, December 6, 2006 Requisites for the establishment of compulsory easement of right of way . FACTS: Glorificacion and Sol Vertudazo and their co-respondents established their permanent residence on a 300 sq. m. lot. Their property was landlocked being bordered on all sides by different lots. As an access route going to Quiones Street and the public highway, they utilized a proposed undeveloped barangay road on the south side of their property owned by Rosario Quiones. Petitioner-spouses Mejorada bought Rosarios lot adjacent to respondents property. Included therein is an area measuring 55.5 sq. m. which serves as an adequate outlet to 34

Quiones Street, now the subject of the present controversy. For several years, respondents and the general public have been using that area as a passageway to and from Quiones Street. Petitioners closed the passageway by building a new garage for their service jeep. Respondents filed a complaint with the RTC praying for a grant of easement of right of way over petitioners property. ISSUE: Are respondents entitled to an easement of right of way? HELD: YES. Respondents are entitled to legal or compulsory right of way because they have complied with the following requisites: (a) the estate is surrounded by other immovable and is without adequate outlet to a public highway; (b) payment of proper indemnity; (c) the isolation was not due to the proprietors own facts, and (d) the right of way claimed is at a point least prejudicial to the servient estate. MEJORDA V. VERTUDAZO, G.R. No. 151797, October 11, 2007 May the improvements introduced by a possessor not in the concept of an owner on a property belonging to another be offset against the harvests he derived therefrom? FACTS: Daniel Aquino is a registered owner of a land which he mortgaged with the Development Bank of the Philippines (DBP). As the property was in danger of being foreclosed, respondents sold to petitioners a portion of the land with the agreement that petitioners would assume the remaining mortgage obligation of respondents with the DBP and the balance shall be paid to respondents. Petitioners were allowed by respondents to take possession of the land. Subsequently, petitioners applied for a re-structuring of the mortgage loan with the DBP for a period of ten years. Petitioners then went to DBP to pay for the amortization but they found out that respondents had paid the bank and the latter told the former that they would return whatever the petitioners paid for the land and threatened to withdraw the title from the bank. Petitioners filed with the trial court for Specific Performance with Preliminary Injunction and Damages and three days later, respondents withdrew the amount which they had paid to the bank. During the pendency of the case, petitioners were able to fully settle the loan with the DBP. The trial court rendered a decision assailed by herein petitioners on the ground, among others, that offsetting the claim of improvements by petitioners and the claim of the fruits derived from the land by respondents is erroneous citing Article 546 and 547 of the Civil Code. Petitioners argue that as possessors in good faith and in the concept of an owner, they are entitled to the fruits received before possession was legally interrupted and they must be reimbursed for their expenses or for the increase on the value the subject property may have acquired by reason thereof. ISSUE: Whether there is legal ground to order the offsetting of the claim of improvements by petitioners to the claim the fruits derived from the land by respondents. HELD: Yes. The records show that both parties failed to prove their claims through any receipt or 35

document. Despite the lack of proof, the trial court ordered that whatever improvements spent on the land shall be offset from the fruits derived therefrom. The plaintiffs claimed that they were able to improve the land after possession was given to them. No receipts were shown to guide the court as to how much were the costs of the improvements. Likewise the defendants claimed that the plaintiffs were able to cultivate land and harvest palay although their testimonies to this effect are based on their presumptions and calculations not on actual harvest such that the court also cannot make determination of the real fruits derived from the land. This being so, the court shall just offset the claim of improvements to the claim of fruits derived from the land and then place the parties in their previous positions before the agreement. Whatever improvements spent on the land shall be compensated from the fruits derived therefrom. LAURENCIO C. RAMEL, et al. vs. DANIEL AQUINO, et al. G.R No. 133208, July 31, 2006

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