Cuevas, J. M. A.

11. Capitol Wireless, Inc. vs. Provincial Treasurer of Batangas

G.R. No. 180110. May 30, 2016

Facts:
1. Petitioner Capitol Wireless, Inc. (Capwire) is a Philippine corporation in the business of
providing international telecommunications services. As such provider, Capwire has signed
agreements with other local and foreign telecommunications companies covering an
international network of submarine cable systems such as the Asia Pacific Cable Network
System (APCN)
2. Capwire claims that it is co-owner only of the so-called Wet Segment of the APCN, which,
as alleged by CAPWIRE, is laid in the international and not in Philippine waters.
3. Capwire also claims that as co-owner, and consistent with its financial contributions, it
owns the the right to use certain capacity of the said system. Said property right is
allegedly reported in its financial books as Indefeasible Rights in Cable Systems
4. The Provincial assessor had determined that the submarine cable systems described in
Capwires Sworn Statement of True Value of Real Properties are taxable real property.
5. Capwire then received a Warrant of Levy and a Notice of Auction of Sale by the Provincial
Treasurer of Batangas. Capwire filed a petition for Prohibition and Declaration of Nullity of
Warrant of Levy, and Notice of Auction of Sale with the RTC.
6. The Regional Trial Court dismissed the petition on the grounds that Capwire failed to follow
the requisite of payment under protest as well as failure to appeal to the Local Board of
Assessment Appeals. This decision was affirmed in toto by the Court of Appeals.
7. Capwire contends that payment of the tax under protest, or recourse to the Local Board of
Assessment Appeals is inapplicable to the case since the issue raised ,which is whether
the submarine cable system (which it claims to lie in the international waters) is taxable, is
purely a question of law

Issue/s:
Whether submarine wires and cables used for communications may be taxed like other real
estate

Ruling:
The Supreme Court in favor of the public Respondent, The Provincial Treasurer of Batangas.
The Supreme Court held that submarine or undersea communications are akin to electric
transmission lines which the Court recently declared in Manila Electric Co. vs. City Assessor of
Lucena City, as no longer exempted from real property tax and may qualify as machinery
subject to real property tax under the Local Government Code. The Supreme Court further states
that both electric lines and communication cables, though not directly adhered to the soil, may
be classified under the term machinery as real property (immovable) under Article 415 (5) of
the Civil code, for the reason that such pieces of equipment serve as the owners business, or
tend to meet the needs of his industry or works that are on the real estate. Thus, since Capwire
failed to present any express grant of an exemption for its lines and cables from real property
taxation, then it applies that Capwires submarine cable may be held subject to real property tax.

10. Machinery & Engineering Supplies Inc. vs. CA

G.R. No L-7057, October 29, 1954

Facts:
1. Petitioner Machinery & Engineering Supplies Inc (MESI) filed a complaint for replevin in the CFI
Manila against the IPO Limestone Co. Inc (IPO), for the recovery of the machineries and
equipments sold and delivered to said defendants at their factory in Barrio Bigti, Norzagaray,
Bulacan.
 Cuevas, J. M. A.
2. The respondent judge issued an order commanding the Provincial Sheriff to seize and take
immediate possession of the properties specified in said order. The two deputy Sheriffs, and
Ramon Roco, the President of MESI, and some laborers then proceeded to IPOs factory.
3. They were met by the manager of IPO and presented to them the letter-protest against the
seizure of the properties in question, on the ground that such properties are not personal
properties. Rocos attention was then called to the fact that the equipments could not be possibly
dismantled without causing damage or injuries to the wooden frames attached to it. However,
Roco insisted in dismantling the equipments at his own responsibility.
4. IPO then filed an urgent motion for the return of the properties seized, by which the trial court
grants. The trial court issued an order for the Provincial Sheriff and the MESI to reinstate the
machineries and equipments removed by them in their original condition in which they are found
before their removal at the expense of MESI.

Issue/s:
Whether the respondent judge committed a grave abuse of discretion and acted in excess of its
jurisdiction

Ruling:
The Supreme Court ruled in favor of the respondents. The Supreme Court held the machinery
and equipment in question appeared to be attached to the land, particularly to the concrete
foundation of said premises, in a fixed manner, in such a way that the former could not be
separated from the latter without breaking the material or the deterioration of the object. In this
case, in order to remove the machineries and equipments in question, not only was it necessary
to unbolt the same, but also to cut and saw some of its wooden supports. Moreover, said
machineries were intended by the owner of the tenement for an industry, or tended directly to
meet the needs of said industry. And for the reason, the Supreme Court held that the
machineries and equipments in question were already immovable property pursuant to
Paragraphs 3 an 5 of Article 415 of the Civil Code and as such, they were not subject to
replevin. Furthermore, the Supreme Court held that inasmuch as the machinery and equipment
involved in this case were duly installed and affixed in the premises of respondent company
when petitioner's representative caused said property to be dismantled and then removed, it
follows that petitioner must also do everything necessary to the reinstallation of said property in
conformity with its original condition.

09. Yap vs. Taada

G.R. No. L-32917 July 18, 1988

Facts:
1. Goulds Pumps International (Phil.) Inc (Goulds) filed a complaint against Julian Yap seeking
recovery of P1459.30 representing the balance of the price and installation cost of a water
pump in the latters premises.
2. Upon the trial, none of the defendants appeared despite notices having been served upon
them. The court then renders judgment in favor of Goulds, ordering Yap to pay to the
former said balance with interest.
3. Yap then filed for Motion for Reconsideration and insisted that his motion for
postponement should have been granted since it expressed his desire to explore the
possibility of an amicable settlement.
4. Judge Tanada issued an order granting the writ of execution. The Deputy Sheriff went
ahead with the scheduled auction sale and sold the property levied on to Goulds as the
highest bidder
5. Yap filed a Motion to Set Aside Execution Sale and Quash Alias Writ of Execution
contending that, inter alia, "the sale was made without the notice required by Sec. 18,
Rule 39, of the New Rules of Court," i.e., notice by publication in case of execution sale of
 Cuevas, J. M. A.
real property, the pump and its accessories being immovable because attached to the
ground with character of permanency

Issue/s:
Whether the water pump and its accessories had become immovable property by its being
installed in his residence

Ruling:
The Supreme Court denied the petition and dismissed the appeal. The Supreme Court held that
the Civil Code of the Philippines contemplates that as immovable property, anything "attached to
an immovable in a fixed manner, in such a way that it cannot be separated therefrom without
breaking the material or deterioration of the object." The pump does not fit this description. It
could be, and was in fact separated from Yap's premises without being broken or suffering
deterioration. Obviously the separation or removal of the pump involved nothing more
complicated than the loosening of bolts or dismantling of other fasteners.

08. Lopez vs. Orosa, Jr

G.R. Nos. L-10817-18 February 28, 1958

Facts:
1. In 1946, Vicente Orosa, Jr. went to Enrique Lopez house and invited him to make an
investment in the theatre business, where his corporation Plaza Theatre was engaged to
venture.
2. Lopez, although unwilling to invest of the same, agreed to supply lumbers necessary for
the construction of the proposed theatre.
3. It was agreed that payment therefor would be on demand and not cash on delivery basis.
Lopez then delivered the lumber necessary for construction, where in the total cost
amounted to P62,255.85, but Lopez was only paid P20,848.50.
4. As Lopez was pressing Orosa for payment of the remaining unpaid obligation, Orosa and
the President of the Corporation, Belarmino Rustia, promised to obtain a bank load by
mortgaging the properties of the Plaza theatre out of which the remaining balance would
be satisfied.
5. The corporation got a loan for P30,000 from the Philippine National Bank with the Luzon
Surety Company as surety and executed a mortgage on the land and building in favor of
said company as counter-security.
6. When the corporation applied for the registration of the land, such mortgage was not
revealed and thus Original Certificate of title was correspondingly issued without any
encumbrance appearing thereupon.
7. Persistent demand of Lopez for the payment of the amount due prompted Orosa to
execute an alleged deed of assignment of his 420 shares of stock of Plaza Theatre.
8. But as the obligation remain unsettled, Lopez filed a complaint with the CFI Batangas,
praying that defendants be sentenced to pay him jointly and severally, and in case the
defendants fail to do the same, the building and the land of the corporation be sold at
public auction and the proceeds thereof be applied to said indebtedness, or assigned 420
shares of stock be sold at public auction for the same purpose.
9. Orosa and the defendant corporation alleged that such building materials were delivered
to them as promoter and later the treasurer of said corporation and on Lopez personal
account; and that the 420 shares of stocks was not assigned to Lopez as collaterals but as
direct security for payment of the remaining balance.

Issue/s:
1. Whether a material mans lien for the value of the materials used in the construction of a
building attaches to said structure alone and does not extend to the land which the
building is adhered to.
 Cuevas, J. M. A.
2. Whether the lower court and the CA erred in not providing that the material mans liens is
superior to the mortgage in favor surety company not only in the building but also on the
land

Ruling:
The Supreme Court ruled in favor of the respondents. The Supreme Court held that real estate
connotes the land and the building constructed thereon, it is obvious that the inclusion of the
building, separate and distinct from the land, in the enumeration of what may constitute real
properties1 could mean only one thing that a building is by itself an immovable property, a
doctrine already pronounced by this Court in the case of Leung Yee vs. Strong Machinery Co., 37
Phil., 644. Moreover, and in view of the absence of any specific provision of law to the contrary, a
building is an immovable property, irrespective of whether or not said structure and the land on
which it is adhered to belong to the same owner. the inevitable conclusion must be that the lien
so created attaches merely to the immovable property for the construction or repair of which the
obligation was incurred. Evidently, therefore, the lien in favor of appellant for the unpaid value of
the lumber used in the construction of the building attaches only to said structure and to no
other property of the obligors.
Considering the conclusion thus arrived at, i.e., that the materialman's lien could be charged only
to the building for which the credit was made or which received the benefit of refection, the
lower court was right in, holding at the interest of the mortgagee over the land is superior and
cannot be made subject to the said materialman's lien.