Jaime Abalos and Spouses Felix Salazar and Consuelo Salazar

Possession in Good Faith and Bad Faith
PHILIPPINE NATIONAL BANK, petitioner,

vs.
GENEROSO DE JESUS, represented by his Attorney-in-Fact, CHRISTIAN
DE JESUS, respondent.
G.R. No. 149295. September 23, 2003
FIRST DIVISION
PONENTE: VITUG, J.:
FACTS:
On June 10, 1995, respondent filed a complaint against petitioner before the
Regional Trial Court of Occidental Mindoro for recovery of ownership and
possession, with damages, over the questioned property. In his complaint,
respondent stated that he had acquired a parcel of land with an area of 1,144 square
meters covered by TCT No. T-17197. He had also caused a verification survey of
the property and discovered that the northern portion of the lot was being
encroached upon by a building of petitioner to the extent of 124 square
meters. Despite two letters of demand sent by respondent, petitioner failed and
refused to vacate the area.
Petitioner asserted that when it acquired the lot and the building sometime in
1981 from then Mayor Bienvenido Ignacio and the encroachment already was in
existence when Mayor Ignacio offered to sell the area in question to petitioner at
P100.00 per square meter. The sale, however, did not materialize when, without
the knowledge and consent of petitioner, Mayor Ignacio later mortgaged the lot to
the Development Bank of the Philippines.
ISSUE:
Whether or not the petitioner Philippine National Bank is a possessor in
good faith.
RULING:
No. The Philippine National Bank is not a possessor in good faith.
Good faith, here understood, 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.5 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.
Given the findings of both the trial court and the appellate court, it should be
evident enough that petitioner would fall much too short from its claim of good
faith. Evidently, petitioner was quite aware, and indeed advised, prior to its
acquisition of the land and building from Ignacio that a part of the building sold to
it stood on the land not covered by the land conveyed to it.
Equally significant is the fact that the building, constructed on the land by
Ignacio, has in actuality been part of the property transferred to petitioner. Article
448, of the Civil Code refers to a piece of land whose ownership is claimed by two
or more parties, one of whom has built some works (or sown or planted something)
and not to a case where the owner of the land is the builder, sower, or planter who
then later loses ownership of the land by sale or otherwise for, elsewise stated,
where the true owner himself is the builder of works on his own land, the issue of
good faith or bad faith is entirely irrelevant.
DISPOSITIVE PORTION:
WHEREFORE, the decision of the Court of Appeals in CA-G.R. CV No.
56001 is AFFIRMED.
SAMUEL PARILLA, CHINITA PARILLA and DEODATO

PARILLA, Petitioners,
vs.
DR. PROSPERO PILAR, Respondent.
G.R. No. 167680. November 30, 2006
THIRD DIVISION
PONENTE: CARPIO MORALES, J.:
FACTS:
Spouses Samuel and Chinita Parilla and their son Deodato Parilla, as dealers
of Pilipinas Shell Petroleum Corporation, have been in possession of a parcel of
land located at the Poblacion of Bantay, Ilocos Sur which was leased to it by
respondent Dr. Prospero Pilar under a 10-year Lease Agreement entered into in
1990.
When the lease contract between Pilipinas Shell and respondent expired in
2000, petitioners remained in possession of the property on which they built
improvements consisting of a billiard hall and a restaurant, maintained a sari-sari
store managed by Leonardo Dagdag, Josefina Dagdag and Edwin Pugal. They also
allowed Flor Pelayo, Freddie Bringas and Edwin Pugal to use a portion thereof as
parking lot.
Despite demands to vacate, petitioners and the other occupants remained in

the property.
On February 3, 2003, the MTC ordered herein petitioners and their co-
defendants and all persons claiming rights under them to vacate the property and to
pay the plaintiff-herein respondent the amount of ₱50,000.00 as reasonable
compensation for the use of the property and ₱10,000.00 as attorney's fees and to
pay the cost of suit. It also ordered the plaintiff-herein respondent to reimburse
defendants Samuel Parilla, Chinita Parilla and Deodato Parilla the amount of Two
Million Pesos (₱2,000,000.00) representing the value of the improvements
introduced on the property.
Respondent appealed to the RTC of Vigan City. However, the RTC affirmed
the decision of the MTC.
The respondents filed Petition for Review wherein the Court of Appeals set
aside the questioned order for respondent to reimburse petitioners Two Million
Pesos. The appellate Court applied the codal provision of Article 546 of the New
Civil Code.
Petitioners conclude that being builders in good faith, until they are
reimbursed of the Two Million Peso-value of the improvements they had
introduced on the property, they have the right of retention or occupancy thereof
pursuant to Article 448, in relation to Article 546, of the New Civil Code.
ISSUE:
Whether or not the petitioners are entitled to reimbursement for the
improvements being builders in good faith as contemplated in Article 448 of the
New Civil Code.
RULING:
The petitioners are not considered as builders, planters, and sowers in good
faith as contemplated in Article 448 of the New Civil Code.
Jurisprudence is replete with cases which categorically declare that Article

448 covers only cases in which the builders, sowers or planters believe themselves
to be owners of the land or, at least, have a claim of title thereto, but not when the
interest is merely that of a holder, such as a mere tenant, agent or usufructuary. A
tenant cannot be said to be a builder in good faith as he has no pretension to be
owner.
In a plethora of cases, this Court has held that Articles 448 of the Civil
Code, in relation to Article 546 of the same Code, which allows full reimbursement
of useful improvements and retention of the premises until reimbursement is made,
applies only to a possessor in good faith, i.e., one who builds on land with the
belief that he is the owner thereof. It does not apply where one's only interest is
that of a lessee under a rental contract; otherwise, it would always be in the power
of the tenant to "improve" his landlord out of his property.
Petitioners’ claim for reimbursement of the alleged entire value of the
improvements does not thus lie under Article 1678. Not even for one-half of such
alleged value, there being no substantial evidence, e.g., receipts or other
documentary evidence detailing costs of construction. Besides, by petitioners’
admission, of the structures they originally built — the billiard hall,
restaurant, sari-sari store and a parking lot, only the "bodega-like" sari-sari store
and the parking lot now exist.
At all events, under Article 1678, 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 that time, or to allow the lessee
to remove the improvements. This option solely belongs to the lessor as the law is
explicit that "should the lessor refuse to reimburse said amount, the lessee may
remove the improvements, even though the principal thing may suffer damage
thereby." It appears that the lessor has opted not to reimburse.
WHEREFORE, the petition is DENIED. The Court of Appeals Decision of
January 19, 2005 is AFFIRMED in light of the foregoing discussions.
JAIME ABALOS and SPOUSES FELIX SALAZAR and CONSUELO

SALAZAR, GLICERIO ABALOS, HEIRS OF AQUILINO ABALOS,
namely: SEGUNDA BAUTISTA, ROGELIO ABALOS, DOLORES A.
ROSARIO, FELICIDAD ABALOS, ROBERTO ABALOS, JUANITO
ABALOS, TITA ABALOS, LITA A. DELA CRUZ AND HEIRS OF
AQUILINA ABALOS, namely: ARTURO BRAVO, PURITA B. MENDOZA,
LOURDES B. AGANON, CONSUELO B. SALAZAR, PRIMA B. DELOS
SANTOS, THELMA APOSTOL and GLECERIO ABALOS, Petitioners,
vs.
HEIRS OF VICENTE TORIO, namely: PUBLIO TORIO, LIBORIO
TORIO, VICTORINA TORIO, ANGEL TORIO, LADISLAO TORIO,
PRIMO TORIO and NORBERTO TORIO, Respondents.
G.R. No. 175444. December 14, 2011
THIRD DIVISION
PONENTE: PERALTA, J.:
FACTS:
Respondents contended that they are the children and heirs of Vicente Torio
who died intestate on September 11, 1973. During the demise of Vicente, he left
behind a parcel of land measuring which is located at San Isidro Norte, Binmaley,
Pangasinan.
Vicente through his tolerance allowed Jaime and the Spouses Salazar to stay
and build their respective houses on the subject parcel of land and to remain on the
disputed lot. However, in 1985, respondents asked Jaime and the Spouses Salazar
to vacate the subject lot, but they refused to heed the demand of respondents
forcing respondents to file the complaint.
On December 10, 2003, the MTC issued a Decision, ordering Jaime and
Spouses Salazar to remove their respective houses standing on the land in dispute.
They were also ordered to either singly or jointly to pay the heirs of Vicente Torio
the land rent in the amount of ₱12,000.00 per year to be reckoned starting the year
1996 until Jaime and Spouses Salazar will finally vacate the premises.
Furthermore, they were also ordered to pay, either singly or jointly, the amount of
₱10,000.00 as and by way of attorney’s fees and costs of suit.
Jaime and the Spouses Salazar appealed the Decision of the MTC with the
RTC of Lingayen, Pangasinan. On June 14, 2005, the RTC ruled in favor of the
petitioners, holding that they have acquired the subject property through
prescription. Accordingly, the RTC dismissed herein respondents’ complaint.
ISSUE:
Whether or not the petitioners are the absolute and exclusive owners of the
land in question by virtue of acquisitive prescription.
RULING:
Acquisitive prescription of dominion and other real rights may be ordinary
or extraordinary. Ordinary acquisitive prescription requires possession in good
faith and with just title for ten (10) years. Without good faith and just title,
acquisitive prescription can only be extraordinary in character which requires
uninterrupted adverse possession for thirty (30) years.
Possession "in good faith” consists in the reasonable belief that the person
from whom the thing is received has been the owner thereof, and could transmit his
ownership. There is "just title' when the adverse claimant came into possession of
the property through one of the modes recognized by law for the acquisition of
ownership or other real rights, but the grantor was not the owner or could not
transmit any right.
In the instant case, it is clear that during their possession of the property in
question, petitioners acknowledged ownership thereof by the immediate
predecessor-in-interest of respondents. This is clearly shown by the Tax
Declaration in the name of Jaime for the year 1984 wherein it contains a statement
admitting that Jaime’s house was built on the land of Vicente, respondents"
immediate predecessor-in- interest. Petitioners never disputed such an
acknowledgment. Thus, having knowledge that they nor their predecessors-in-
interest are not the owners of the disputed lot, petitioners" possession could not be
deemed as possession in good faith as to enable them to acquire the subject land by
ordinary prescription. In this respect, the Court agrees with the CA that petitioners"
possession of the lot in question was by mere tolerance of respondents and their
predecessors-in-interest. Acts of possessory character executed due to license or by
mere tolerance of the owner are inadequate for purposes of acquisitive
prescription. Possession, to constitute the foundation of a prescriptive right, must
be en concepto de dueño, or, to use the common law equivalent of the term, that
possession should be adverse, if not, such possessory acts, no matter how long, do
not start the running of the period of prescription
This Court has held that the evidence relative to the possession upon which
the alleged prescription is based, must be clear, complete and conclusive in order
to establish the prescription. In the present case, the Court finds no error on the part
of the CA in holding that petitioners failed to present competent evidence to prove
their alleged good faith in neither possessing the subject lot nor their adverse claim
thereon. Instead, the records would show that petitioners" possession was by mere
tolerance of respondents and their predecessors-in-interest.
WHEREFORE, the petition is DENIED. The assailed Decision and
Resolution of the Court of Appeals in CA-G.R. SP No. 91887 are AFFIRMED.
Acquisition of Possession
PRECY BUNYI and MILA BUNYI, Petitioners,

vs.
FE S. FACTOR, Respondent.
G.R. No. 172547. June 30, 2009
SECOND DIVISION
PONENTE: QUISUMBING, J.:
FACTS:
Respondent Fe S. Factor is one of the co-owners of piece of land located in
Almanza, Las Piñas City. The ownership of the land originated from respondent's
paternal grandparents Constantino Factor and Maura Mayuga-Factor who had been
in actual, continuous, peaceful, public, adverse and exclusive possession and
occupation of the land even before 1906.
On December 9, 1975, the children of Constantino Factor and Maura

Mayuga-Factor filed a Petition for Original Registration and Confirmation of
Imperfect Title to the said parcel of land before the RTC of Pasig City.
On December 8, 1994, the trial court granted the petition and declared the
children of Constantino Factor and Maura Mayuga-Factor as co-owners of the
property. The children of Constantino Factor and Maura Mayuga-Factor except the
respondent's father shared and divided the proceeds of the sale among themselves,
with the agreement that Enrique would have as his share the portion of the property
known as the Factor compound.
On August 7, 1993, Enrique Factor died and the administration of the Factor
compound including the subject rest house and other residential houses for lease
was transferred and entrusted to Enrique's eldest child, Gloria Factor-Labao.
On January 15, 2001, Gloria died. The administration and management of

the Factor compound including the subject rest house, passed on to respondent Fe
S. Factor as co-owner of the property wherein she allowed Ruben Labao stay at the
rest house for brief, transient and intermittent visits as a guest of the Factor family.
On May 31, 2002, Ruben Labao married petitioner Precy Bunyi. At about
this time, respondent discovered that petitioners forcibly opened the doors of the
rest house and stole all the personal properties owned by the Factor family and
then audaciously occupied the premises. Respondent alleged that petitioners
unlawfully deprived her and the Factor family of the subject property's lawful use
and possession. Respondent also added that when she tried to enter the rest house
on December 1, 2002, an unidentified person who claimed to have been authorized
by petitioners to occupy the premises, barred, threatened and chased her with a
jungle bolo.
On September 12, 2003, respondent Fe S. Factor filed a complaint for

forcible entry against herein petitioners Precy Bunyi and Mila Bunyi.
Petitioners, for their part, questioned Fe's claim of ownership of the subject
property and the alleged prior ownership of her father Enrique Factor. They
asserted that the subject property was owned by Ruben Labao, and that petitioner
Precy with her husband moved into the subject property, while petitioner Mila
Bunyi, mother of Precy, remained in No. 8 Antioch St.
ISSUE:
Whether or not the Court of Appeals erred when it misappreciated the fact
that the respondent has a better right of physical and material possession of the
subject property.
RULING:
For one to be considered in possession one need not have actual or physical
occupation of every square inch of the property at all times. Possession can be
acquired not only by material occupation, but also by the fact that a thing is subject
to the action of one's will or by the proper acts and legal formalities established for
acquiring such right. Possession can be acquired by juridical acts. These are acts to
which the law gives the force of acts of possession. Examples of these are
donations, succession, execution and registration of public instruments, and the
inscription of possessory information titles.
The right of respondent's predecessors over the subject property is more than
sufficient to uphold respondent's right to possession over the same. Respondent's
right to the property was vested in her along with her siblings from the moment of
their father's death. As heir, respondent had the right to the possession of the
property, which is one of the attributes of ownership. Such rights are enforced and
protected from encroachments made or attempted before the judicial declaration
since respondent acquired hereditary rights even before judicial declaration in
testate or intestate proceedings.
As found by the Court of Appeals, petitioners' unsupported claim of
possession must yield to that of the respondent who traces her possession of the
subject property to her predecessors-in-interest who have always been in
possession of the subject property. Even assuming that respondent was never a
resident of the subject property, she could legally continue possessing the property.
Visiting the property on weekends and holidays is evidence of actual or physical
possession. The fact of her residence somewhere else, by itself, does not result in
loss of possession of the subject property. The law does not require one in
possession of a house to reside in the house to maintain his possession. For, again,
possession in the eyes of the law does not mean that a man has to have his feet on
every square meter of the ground before he is deemed in possession. There is no
cogent reason to deviate from this doctrine.
WHEREFORE, the instant petition is DENIED. The challenged
Decision dated January 16, 2006 and Resolution dated April 26, 2006 of the Court
of Appeals in CA-G.R. SP No. 90397 are AFFIRMED with
MODIFICATION that the award of rentals and attorneys fees are DELETED.
No pronouncement as to costs.
THE PEOPLE OF THE PHILIPPINES, appellee,

vs.
SALVADOR PEÑAFLORIDA, JR., Y CLIDORO, appellant.
G.R. No. 175604. April 10, 2008
SECOND DIVISION
PONENTE: TINGA, J.:
FACTS:
On or about the June 7, 1994, in the afternoon thereat, at Barangay Huyon-
huyon, Municipality of Tigaon, Province of Camarines Sur, Salvador Peñaflorida,
with intent to sell, possess and to deliver with the use of a bicycle, did then and
there, willfully, unlawfully and feloniously have in his possession, control and
custody, one bundle estimated to be one (1) kilo more or less, of dried marijuana
leaves (Indian Hemp) without the necessary license, permit or authority to sell,
administer, deliver, give away to another, distribute, dispatch in transit or transport
any prohibited drug from a competent officer as required by law.
The appellant pleaded not guilty during the arraignment. The trial ensued
and there were two police officers and one forensic chemist who testified for the
prosecution.
On October 26, 1998, the trial court rendered judgment finding appellant
guilty beyond reasonable doubt of transporting a prohibited drug, a violation of
Section 4, Article II of Republic Act (R.A.) No. 6425, otherwise known as The
Dangerous Drugs Act of 1972, as amended by R.A. No. 7659.
Appellant admitted that he was about to convey from one place to another
the package, which contained marijuana, to a certain Jimmy Gonzales. The
appellant, however, denies any knowledge that the package in his possession
contained marijuana.
ISSUE:
Whether or not the accused willfully, unlawfully and feloniously have in his
possession, control and custody of dried marijuana leaves.
RULING:
The trial court rejected the contention of the appellant, noting that it was
impossible for appellant not to be aware of the contents of the package because
"marijuana has a distinct sweet and unmistakable aroma which would have
alarmed him."
Appellant, in the main, asserts that he did not freely and consciously possess
marijuana. In criminal cases involving prohibited drugs, there can be no conviction
unless the prosecution shows that the accused knowingly possessed the prohibited
articles in his person, or that animus possidendi is shown to be present together
with his possession or control of such article. Animus possidendi is only prima
facie. It is subject to contrary proof and may be rebutted by evidence that the
accused did not in fact exercise power and control over the thing in question, and
did not intend to do so. The burden of evidence is thus shifted to the possessor to
explain absence of animus possidendi.
Knowledge refers to a mental state of awareness of a fact. Since courts

cannot penetrate the mind of an accused and thereafter state its perceptions with
certainty, resort to other evidence is necessary. Animus possidendi, as a state of
mind, may be determined on a case-to-case basis by taking into consideration the
prior or contemporaneous acts of the accused, as well as the surrounding
circumstances. Its existence may and usually must be inferred from the attendant
events in each particular case.
Appellant failed to satisfactorily establish his lack of knowledge of

possession in the instant case. First, the marijuana was found in the bicycle he
himself was driving. Second, the police officers first readily saw in plain view the
edges of the marijuana leaves jutting out of the package. Third, it is incredulous
that appellant did not ask Obias what the package contained when the latter
requested him to do the delivery errand since the package was wrapped in a
newspaper and weighed almost one kilogram.
Finally, it is very hard for the court to accept the claim of the accused
Peñaflorida that he does not know that the thing wrapped in a newspaper which
Boyet Obias, now dead, requested the accused Peñaflorida, would deliver to a
certain Jimmy Gonzales whose present whereabouts is not known, was a
marijuana. Its odor is different especially from tobacco. This was observed by the
court during the trial of the case, everytime the wrapper containing the subject
marijuana with a volume of 928 grams is brought to court its odor is noticeable.
For the accused Peñaflorida, not to notice it is hard to believe. Rightly so, because
marijuana has a distinct sweet and unmistakable aroma very different from (and
not nauseating) unlike tobacco. This aroma would have alarmed him.
WHEREFORE, in view of the foregoing, the decision of the Regional Trial
Court of San Jose, Camarines Sur, Branch 30 in Criminal Case No. T-1476,
finding appellant Salvador Peñaflorida y Clidoro guilty beyond reasonable doubt
of violation of Section 4, Article II of R.A. No. 6425 (Dangerous Drugs Act) as
amended, and sentencing him to suffer the penalty of reclusion perpetua and to
pay a fine of One Million Pesos (P1,000,000.00), is AFFIRMED in toto.
MARK SOLEDAD y CRISTOBAL, Petitioner,

vs.
PEOPLE OF THE PHILIPPINES, Respondent.
G.R. No. 184274. February 23, 2011
SECOND DIVISION
PONENTE: NACHURA, J.:
FACTS:
Sometime in June 2004, private complainant Henry C. Yu received a call on
his mobile phone from a credit card agent, who offered a Citi financing loan
assistance at a low interest rate. The petitioner told private complainant to submit
documents to facilitate the loan assistance application. Private complainant
submitted various documents. Subsequently, private complainant followed up his
loan status but he failed to get in touch with the petitioner.
During the first week of August 2004, private complainant received his
Globe handy phone statement of account wherein he was charged for two (2)
mobile phone numbers which were not his. Private complainant verified with the
telephone company and learned that he had additional five (5) mobile numbers
were in his name. The application for said cellular phone lines bore the picture of
the petitioner and his forged signature. He also learned that his Citibank Credit
Card database information was altered and he had a credit card application with
Metrobank Card Corporation.
Private complainant Jefferson Devilleres lodged a complaint with the

National Bureau of Investigation which conducted an entrapment operation. Thus,
he was charged with Violation of Section 9(e), R.A. No. 8484 for "possessing a
counterfeit access device or access device fraudulently applied for."
The petitioner pleaded "not guilty" and the trial on the merits
ensued. Petitioner then filed a Demurrer to Evidence alleging that he was not in
physical and legal possession of the credit card presented and marked in evidence
by the prosecution. On May 2, 2006, the RTC denied the Demurrer to Evidence as
it preferred to rule on the merits of the case.
On September 27, 2006, the RTC rendered a decision finding petitioner
guilty as charged, beyond reasonable doubt of violation of Section 9(e), Republic
Act 8484 (Access Device Regulation Act of 1998).
On appeal, the CA affirmed petitioner's conviction.
ISSUE:
Whether or not the Information is valid considering the act of “possession,”
which is the gravamen of the offense, was not alleged in the Information.
RULING:
The Information sheet must be considered, not by sections or parts, but as
one whole document serving one purpose, i.e., to inform the accused why the full
panoply of state authority is being marshaled against him. Our task is not to
determine whether allegations in an indictment could have been more artfully and
exactly written, but solely to ensure that the constitutional requirement of notice
has been fulfilled.
Besides, even if the word "possession" was not repeated in the accusatory
portion of the Information, the acts constituting it were clearly described in the
statement "that the credit card in the name of Henry Yu was successfully issued,
and delivered to said accused using a fictitious identity and addresses of Henry Yu,
to the damage and prejudice of the real Henry Yu." Without a doubt, petitioner
was given the necessary data as to why he was being prosecuted.
The trial court convicted petitioner of possession of the credit card

fraudulently applied for, penalized by R.A. No. 8484. The law, however, does not
define the word "possession." Thus, we use the term as defined in Article 523 of
the Civil Code, that is, "possession is the holding of a thing or the enjoyment of a
right." The acquisition of possession involves two elements: the corpus or the
material holding of the thing, and the animus possidendi or the intent to possess it.
Animus possidendi is a state of mind, the presence or determination of which is
largely dependent on attendant events in each case. It may be inferred from the
prior or contemporaneous acts of the accused, as well as the surrounding
circumstances.
WHEREFORE, premises considered, the petition is DENIED for lack of
merit. The Court of Appeals Decision dated June 18, 2008 and Resolution dated
August 22, 2008 in CA-G.R. CR. No. 30603 are AFFIRMED.
CRISTETA CHUA-BURCE, petitioner,

vs.
COURT OF APPEALS AND PEOPLE OF THE PHILIPPINES, respondents.
G.R. No. 109595. April 27, 2000
SECOND DIVISION
FACTS:
On August 16, 1985, the Manager of Metropolitan Bank and Trust Company
Ramon Rocamora requested the Assistant Cashier Fructuoso Peñaflorto conduct a
physical bundle count of the cash inside the vault, which should total
₱4,000,000.00, more or less.
During this initial cash count, they discovered a shortage of ₱150,000.00.

The next day, to determine if there was actually a shortage, a re-verification of the
records and documents of the transactions in the bank was conducted. There was
still a shortage of ₱150,000.00.
The bank initiated investigations totalling four (4) in all. All of these
investigations concluded that there was a shortage of ₱150,000.00, and the person
primarily responsible was the bank's Cash Custodian, Cristeta Chua-Burce, the
herein accused.
On November 4, 1985, unable to satisfactorily explain the shortage of

P150,000.00, the accused was terminated.
MBTC filed a Civil Case for Sum of Money and Damages with Preliminary
Attachment and Garnishment against petitioner and her husband, Antonio Burce.
The petitioner was also accused with estafa.
On March 18, 1991, the trial court rendered a consolidated decision finding
petitioner guilty of estafa under Article 315 (1) (b) of the Revised Penal Code in
the criminal case, and liable for the amount of ₱150,000.00 in the civil case.
In a decision dated November 27, 1992, the Court of Appeals affirmed the
trial court's decision in toto. Petitioner's Motion for Reconsideration was likewise
denied.
ISSUE:
Whether or not the petitioner has the juridical possession of the money in the
bank and thus she should be liable for the crime of Estafa.
RULING:
No. The petitioner has no juridical possession. When the money, goods, or
any other personal property is received by the offender from the offended party (1)
in trust or (2) on commission or (3) for administration, the offender acquires both
material or physical possession and juridical possession of the thing received.
Juridical possession means a possession which gives the transferee a right

over the thing which the transferee may set up even against the owner. In this
case, petitioner was a cash custodian who was primarily responsible for the cash-
in-vault. Her possession of the cash belonging to the bank is akin to that of a bank
teller, both being mere bank employees.
Petitioner herein being a mere cash custodian had no juridical possession

over the missing funds. Hence, the element of juridical possession being absent,
petitioner cannot be convicted of the crime of estafa under Article 315, No. 1 (b) of
the Revised Penal Code.
WHEREFORE, the petition is hereby granted and petitioner is
ACQUITTED of the crime of estafa under Article 315 (1) (b) of the Revised Penal
Code. Petitioner is ordered RELEASED from custody unless she is being held for
some other lawful cause. No costs.
Effects of Possession
EDCA PUBLISHING & DISTRIBUTING CORP., petitioner,

vs.
THE SPOUSES LEONOR and GERARDO SANTOS, doing business under
the name and style of "SANTOS BOOKSTORE," and THE COURT OF
APPEALS, respondents.
G.R. No. 80298. April 26, 1990
FIRST DIVISION
PONENTE: CRUZ, J.:
FACTS:
On October 5, 1981, a person identifying himself as Professor Jose Cruz
placed an order by telephone with the petitioner company for 406 books, payable
on delivery. EDCA prepared the corresponding invoice and delivered the books as
ordered, for which Cruz issued a personal check covering the purchase price of
₱8,995.65. On October 7, 1981, Cruz sold 120 of the books to private respondent
Leonor Santos who, after verifying the seller’s ownership from the invoice he
showed her, paid him ₱1,700.00.
Meanwhile, EDCA having become suspicious over a second order placed by

Cruz even before clearing of his first check, made inquiries with the De la Salle
College where he had claimed to be a dean and was informed that there was no
such person in its employ. Further verification revealed that Cruz had no more
account or deposit with the Philippine Amanah Bank, against which he had drawn
the payment check. EDCA then went to the police, which set a trap and arrested
Cruz on October 7, 1981. Investigation disclosed his real name as Tomas de la
Peña and his sale of 120 of the books he had ordered from EDCA to the private
respondents.
In its extended memorandum, EDCA cites numerous cases holding that the
owner who has been unlawfully deprived of personal property is entitled to its
recovery except only where the property was purchased at a public sale, in which
event its return is subject to reimbursement of the purchase price.
ISSUE:
Whether or not the respondent has the right of ownership of the (books)
movable property in question.
RULING:
The contention of petitioner that Santos has not established ownership over
the disputed books because they have not even shown the receipt evidencing the
purchase is without merit. The possession of movable property acquired in good
faith is equivalent to title.
Santos acquired the books in good faith as found by the lower Courts. She
first ascertained the ownership and relied on the invoice shown to her by dela Peña.
Santos was in the business of buying and selling books and often deal with hard-up
sellers who urgently have to part with their books at reduced prices.
Moreover, EDCA argued that the impostor acquired no title to the books
because of the lack of funds in the check issued and want of consideration. This is
without merit. Non-payment only creates a right to demand payment or to rescind
the contract, or to criminal prosecution in the case of bouncing checks. But absent
the stipulation above noted, delivery of the thing sold will effectively transfer
ownership to the buyer who can in turn transfer it to another.
Actual delivery of the books having been made, Cruz acquired ownership
over the books which he could then validly transfer to the private respondents. The
fact that he had not yet paid for them to EDCA was a matter between him and
EDCA and did not impair the title acquired by the private respondents to the
books.
It would certainly be unfair now to make the private respondents bear the
prejudice sustained by EDCA as a result of its own negligence. We cannot see the
justice in transferring EDCA’s loss to the Santoses who had acted in good faith,
and with proper care, when they bought the books from Cruz.
While we sympathize with the petitioner for its plight, it is clear that its
remedy is not against the private respondents but against Tomas de la Peña, who
has apparently caused all this trouble. The private respondents have themselves
been unduly inconvenienced, and for merely transacting a customary deal not
really unusual in their kind of business. It is they and not EDCA who have a right
to complain.
WHEREFORE, the challenged decision is AFFIRMED and the petition is
DENIED, with costs against the petitioner.
Effects of Possession
BPI FAMILY BANK, Petitioner,

vs.
AMADO FRANCO and COURT OF APPEALS, Respondents.
G.R. No. 123498. November 23, 2007
THIRD DIVISION
FACTS:
On August 15, 1989, Tevesteco Arrastre-Stevedoring Co., Inc. opened a

savings and current account with BPI-FB. On August 25, 1989, First Metro
Investment Corporation (FMIC) also opened a time deposit account with the same
branch of BPI-FB with a deposit of ₱100,000,000.00, to mature one year thence.
On August 31, 1989, Franco opened three accounts, namely, a current,

savings, and time deposit, with BPI-FB. The current and savings accounts were
respectively funded with an initial deposit of ₱500,000.00 each, while the time
deposit account had P1,000,000.00 with a maturity date of August 31, 1990. The
total amount of P2,000,000.00 used to open these accounts is traceable to a check
issued by Tevesteco allegedly in consideration of Franco's introduction of Eladio
Teves, who was looking for a conduit bank to facilitate Tevesteco's business
transactions, to Jaime Sebastian, who was then BPI-FB SFDM's Branch Manager.
In turn, the funding for the P2,000,000.00 check was part of the P80,000,000.00
debited by BPI-FB from FMIC's time deposit account and credited to Tevesteco's
current account pursuant to an Authority to Debit purportedly signed by FMIC's
officers.
It appears, however, that the signatures of FMIC's officers on the Authority

to Debit were forged. On September 4, 1989, Antonio Ong, upon being shown the
Authority to Debit, personally declared his signature therein to be a forgery.
Unfortunately, Tevesteco had already effected several withdrawals from its current
account (to which had been credited the P80,000,000.00 covered by the forged
Authority to Debit) amounting to P37,455,410.54, including the P2,000,000.00
paid to Franco.
BPI-FB filed separate civil and criminal cases against those believed to be
the perpetrators of the multi-million peso scam. In the criminal case, Franco, along
with the other accused, except for Manuel Bienvenida who was still at large, were
acquitted of the crime of Estafa. However, the civil case remains under litigation
and the respective rights and liabilities of the parties have yet to be adjudicated.
BPI-FB freezed the accounts of Franco and refusing to release his deposits,
claiming that it had a better right to the amounts which consisted of part of the
money allegedly fraudulently withdrawn from it by Tevesteco and ending up in
Franco's accounts. BPI-FB asseverated that the claimed consideration of
₱2,000,000.00 for the introduction facilitated by Franco between George Daantos
and Eladio Teves, on the one hand, and Jaime Sebastian, on the other, spoke
volumes of Franco's participation in the fraudulent transaction.
On August 4, 1993, the Manila RTC rendered judgment in favor of Franco

and against BPI-FB.
ISSUE:
Whether or not Amado Franco had better right to the deposits in the subject
accounts which are part of the proceeds of a forged Authority to Debit
RULING:
There is no doubt that BPI-FB owns the deposited monies in the accounts of
Franco, but not as a legal consequence of its unauthorized transfer of FMIC's
deposits to Tevesteco's account. BPI-FB conveniently forgets that the deposit of
money in banks is governed by the Civil Code provisions on simple loan or
mutuum. As there is a debtor-creditor relationship between a bank and its
depositor, BPI-FB ultimately acquired ownership of Franco's deposits, but such
ownership is coupled with a corresponding obligation to pay him an equal amount
on demand. Although BPI-FB owns the deposits in Franco's accounts, it cannot
prevent him from demanding payment of BPI-FB's obligation by drawing checks
against his current account, or asking for the release of the funds in his savings
account. Thus, when Franco issued checks drawn against his current account, he
had every right as creditor to expect that those checks would be honored by BPI-
FB as debtor.
More importantly, BPI-FB does not have a unilateral right to freeze the
accounts of Franco based on its mere suspicion that the funds therein were
proceeds of the multi-million peso scam Franco was allegedly involved in. To
grant BPI-FB, or any bank for that matter, the right to take whatever action it
pleases on deposits which it supposes are derived from shady transactions, would
open the floodgates of public distrust in the banking industry.
Ineluctably, BPI-FB, as the trustee in the fiduciary relationship, is duty
bound to know the signatures of its customers. Having failed to detect the forgery
in the Authority to Debit and in the process inadvertently facilitate the FMIC-
Tevesteco transfer, BPI-FB cannot now shift liability thereon to Franco and the
other payees of checks issued by Tevesteco, or prevent withdrawals from their
respective accounts without the appropriate court writ or a favorable final
judgment.
WHEREFORE, the petition is PARTIALLY GRANTED. The Court of
Appeals Decision dated November 29, 1995 is AFFIRMED with the
MODIFICATION that the award of unearned interest on the time deposit and of
moral and exemplary damages is DELETED.
Restrictive Covenant
ELISEO FAJARDO, JR., and MARISSA FAJARDO, petitioners,
vs.
FREEDOM TO BUILD, INC., respondent.
G.R. No. 134692. August 1, 2000
THIRD DIVISION
PONENTE: VITUG, J.:
FACTS:
Freedom To Build, Incorporated, an owner-developer and seller of low-cost
housing, sold to petitioner-spouses, a house and lot designated Lot No. 33, Block
14 of the De la Costa Homes in Barangka, Marikina, Metro Manila. The Contract
to Sell executed between the parties, contained a Restrictive Covenant providing
certain prohibitions:
Easements. For the good of the entire community, the homeowner must
observe a two-meter easement in front. No structure of any kind (store,
garage, bodega, etc.) may be built on the front easement.
Upward expansion. A second storey is not prohibited. But the second storey
expansion must be placed above the back portion of the house and should
not extend forward beyond the apex of the original building.chanrob1es
virtua1 1aw 1ibrary
Front expansion: 2nd Storey: No unit may be extended in the front beyond
the line as designed and implemented by the developer in the 60 sq. m. unit.
In other words, the 2nd floor expansion, in front, is 6 meters back from the
front property line and 4 meters back from the front wall of the house, just as
provided in the 60 sq. m. units.
The above restrictions were also contained in Transfer Certificate of Title

No. N-115384 covering the lot issued in the name of petitioner-spouses.
The controversy arose when petitioners, despite repeated warnings from

respondent, extended the roof of their house to the property line and expanded the
second floor of their house to a point directly above the original front wall.
The RTC rendered decision against the petitioners and were directed to
immediately demolish and remove the extension of their expanded housing unit
that exceeds the limitations imposed by the Restrictive Covenant, otherwise the
Branch Sheriff of this Court shall execute this decision at the expense of the
defendants.
The Court of Appeals affirmed the decision of the trial court. Hence, this
petition is for review.
ISSUE:
Whether or not the restrictive covenant is valid.
RULING:
Restrictive covenants are not, strictly speaking, synonymous with easements.
While it may be correct to state that restrictive covenants on the use of land or the
location or character of buildings or other structures thereon may broadly be said to
create easements or rights, it can also be contended that such covenants, being
limitations on the manner in which one may use his own property, do not result in
true easements, but a case of servitudes (burden), sometimes characterized to be
negative easements or reciprocal negative easements. Negative easement is the
most common easement created by covenant or agreement whose effect is to
preclude the owner of the land from doing an act, which, if no easement existed, he
would be entitled to do.
Courts which generally view restrictive covenants with disfavor for being a
restriction on the use of one’s property, have, nevertheless, sustained them where
the covenants are reasonable, not contrary to public policy, or to law, and not in
restraint of trade. Subject to these limitations, courts enforce restrictions to the
same extent that will lend judicial sanction to any other valid contractual
relationship. In general, frontline restrictions on constructions have been held to be
valid stipulations.
The provisions in a restrictive covenant prescribing the type of the building

to be erected are crafted not solely for the purpose of creating easements, generally
of light and view, nor as a restriction as to the type of construction, but may also be
aimed as a check on the subsequent uses of the building conformably with what the
developer originally might have intended the stipulations to be in its
Memorandum, respondent states in arguing for the validity of the restrictive
covenant that the — "restrictions are not without specific purpose. In a low cost-
socialized housing, it is of public knowledge that owners-developers are
constrained to build as many number of houses on a limited land area precisely to
accommodate marginalized lot buyers, providing as much as possible the safety,
aesthetic and decent living condition by controlling overcrowding. Such project
has been designed to accommodate at least 100 families per hectare."
There appears to be no cogent reasons for not upholding restrictive

covenants aimed to promote aesthetics, health, and privacy or to prevent
overcrowding.
In sum, the Court holds that —

(1) The provisions of the Restrictive Covenant are valid;
(2) Petitioners must be held to be bound thereby; and
(3) Since the extension constructed exceeds the floor area limits of the
Restrictive Covenant, petitioner-spouses can be required to demolish the
structure to the extent that it exceeds the prescribed floor area limits.
WHEREFORE, the assailed decision, dated 13 July 1998, of the Court of
Appeals in CA-G.R. CV No. 50085, sustaining that of the court a quo, is
AFFIRMED. No costs.
CONCORDIO ABELLANA, SR., PEDRO E. MENDEZ, VERANO

BADANA, CONCORDIO ABELLANA, JR., TEODOLFO ABELLANA,
MUSSULINI BUCAO, REMEDIOS GARCIANO, ALFREDO SY, JUANITO
JABELLANA, CATALINO LABANDERO, PURISIMO JABELLANA,
ANDRES LASTIMOSA, LUCRESIA VDS. DE BENTE, PAULA VDA. DE
BACUS, ARTURO JABELLANA, FLORENTINO LARIOSA, LEODY DE
LA PEÑA, PELAGIA JABELLANA, FE GOCELA, SEVERINO
QUINAMADA and NARCISA LASTIMOSA, petitioners,
vs.
HON. COURT OF APPEALS, ORLANDO P. NAYA, ROSENDO ESTOYE,
JR. and the MUNICIPAL GOVERNMENT OF TALISAY, CEBU,
represented by the Mayor and Members of the Sanguniang
Bayan, respondents.
APOLINARIO ENGUIO, RICO VILLARIN, MARIA ROSARIO
BALBUENA, JOSE TIROL, ASUNCION DE LA PEÑA, ROGELIO B.
GUYOT, LEONIZA FAUSTINO, MAMERTO ZAMORAS, ANTONIO CAL,
VICENTE ALMENDRAS, MICHAEL SERRANO, EDUARDO PADERNOS,
MA. LUZ SANCHEZ, R. CABARERO, OSCAR NAPOLI and ROBERTO
BUENO, intervenors.
G.R. No. 97039. April 24, 1992
FIRST DIVISION
PONENTE: GRIÑO-AQUINO, J.:
FACTS:
ISSUE:
RULING:
WHEREFORE, finding no merit in the petition for review, the same is
DENIED with costs against the petitioners.
BICOL AGRO-INDUSTRIAL PRODUCERS COOPERATIVE, INC.

(BAPCI), Petitioner,
vs.
EDMUNDO O. OBIAS, PERFECTO O. OBIAS, VICTOR BAGASINA,
ELENA BENOSA, MELCHOR BRANDES, ROGELIO MONTERO, PEDRO
MONTERO, CLAUDIO RESARI, PILAR GALON, ANTONIO BUISON,
PRUDENCIO BENOSA, JR., MARIA VILLAMER and ROBERTO
PADUA, Respondent.
G.R. No. 172077. October 9, 2009
THIRD DIVISION
PONENTE: PERALTA, J.:
FACTS:
ISSUE:
RULING:
WHEREFORE, premises considered, the petition is DENIED. The August
24, 2005 Decision and October 27, 2005 Resolution of the Court of Appeals in
CA-G.R. CV No. 59016 are hereby AFFIRMED.
APOLINARDITO C. QUINTANILLA and PERFECTA C.
QUINTANILLA, petitioners,
vs.
PEDRO ABANGAN and DARYL’S COLLECTION INTL. INC., respondents.
G.R. No. 160613. February 12, 2008
THIRD DIVISION
FACTS:
Sometime in the 1960s, Perfecta bought a lot, located at Inayawan, Cebu

City (the dominant estate) from one Dionisio Abasolo, who formerly owned all the
properties therein. Thereafter, Perfecta donated the dominant estate to
Apolinardito, who is now the registered owner thereof. Petitioners own QC Rattan
Inc., and in the conduct of their business, they use vans to haul and transport raw
materials and finished products. Sometime in April 1994, they asked for a right of
way from Pedro in order to expand their business.
However, it appears that Pedro, who was the owner of Lot No. 3771-A-1,
containing an area of 1,164 square meters (the servient estate) and a lot near the
dominant estate, sold the same to DARYL'S on March 24, 1994, and thereafter,
DARYL'S constructed a warehouse over the servient estate, enclosing the same
with a concrete fence.
Petitioners, thus, sought the imposition of an easement of right of way, six

(6) meters in width, or a total area of 244 square meters, over the servient estate.
On June 21, 2000, the RTC dismissed the case for lack of merit. The RTC
held that petitioners failed to establish that the imposition of the right of way was
the least prejudicial to the servient estate. The RTC noted that there is already a
concrete fence around the area and the six (6) meters from the said concrete fence
was a concrete warehouse. Thus, substantial damage and substantial reduction in
area would be caused the servient estate.
On April 21, 2003, the CA affirmed the RTC Decision, holding that the
criterion of least prejudice to the servient estate must prevail over the shortest
distance. A longer way may, thus, be established to avoid injury to the servient
tenement, such as when there are constructions or walls which can be avoided by a
round-about way, as in this case. On September 24, 2003, petitioners filed a
Motion for Reconsideration but the same was denied in the CA Resolution.
ISSUE:
Whether or not the petitioners can validly claim a compulsory right of way
against the respondents.
RULING:
It should be remembered that to be entitled to a legal easement of right of
way, the following requisites must be satisfied:
(1) the dominant estate is surrounded by other immovables and has no
adequate outlet to a public highway;
(2) proper indemnity has been paid;
(3) the isolation was not due to acts of the proprietor of the dominant
estate; and
(4) the right of way claimed is at the point least prejudicial to the servient
estate.
In this case, the fourth requisite is absent.
We are in full accord with the ruling of the CA when it aptly and judiciously
held, to wit:
As provided for under the provisions of Article 650 of the New Civil Code,
the easement of right of way shall be established at the point least prejudicial to the
servient estate, and, insofar as consistent with this rule, where the distance from the
dominant estate to a public highway may be the shortest. Where there are several
tenements surrounding the dominant estate, and the easement may be established
on any of them, the one where the way is shortest and will cause the least damage
should be chosen. But if these two circumstances do not concur in a single
tenement, as in the instant case, the way which will cause the least damage should
be used, even if it will not be the shortest. The criterion of least prejudice to the
servient estate must prevail over the criterion of shortest distance. The court is not
bound to establish what is the shortest; a longer way may be established to avoid
injury to the servient tenement, such as when there are constructions or walls
which can be avoided by a round-about way, as in the case at bar.
As between a right of way that would demolish a fence of strong materials to

provide ingress and egress to a public highway and another right of way which
although longer will only require a van or vehicle to make a turn, the second
alternative should be preferred. Mere convenience for the dominant estate is not
what is required by law as the basis for setting up a compulsory easement. Even in
the face of necessity, if it can be satisfied without imposing the easement, the same
should not be imposed.
Finally, worthy of note, is the undisputed fact that there is already a newly
opened public road barely fifty (50) meters away from the property of appellants,
which only shows that another requirement of the law, that is, there is no adequate
outlet, has not been met to establish a compulsory right of way.
WHEREFORE, the instant Petition is DENIED for lack of merit. The
assailed Court of Appeals Decision, dated April 21, 2003, and Resolution dated
September 24, 2003 are hereby AFFIRMED. Costs against the petitioners.
ANASTACIA QUIMEN, petitioner,

vs.
COURT OF APPEALS and YOLANDA Q. OLIVEROS, respondents.
G.R. No. 112331. May 29, 1996
FIRST DIVISION
PONENTE: BELLOSILLO, J.:
FACTS:
Petitioner Anastacia Quimen together with her brothers inherited a piece of
property situated in Pandi, Bulacan. They agreed to subdivide the property equally
among themselves wherein their property is abutting the municipal road.
On February 1982 Yolanda purchased Lot No. 1448-B-6-A from her uncle
Antonio through her aunt Anastacia who was then acting as his administratrix. At
first, Yolanda hesitated to buy the property since it has no access to the public road
but Anastacia prevailed upon her to buy the lot with the assurance that she would
give her a right of way on her adjoining property for P200.00 per square meter.
Thereafter, Yolanda constructed a house on the lot she bought using as her
passageway to the public highway a portion of Anastacia’s property. However,
when the respondent offered to pay the Anastacia, she refused and even barred the
respondent from passing in her property.
On 29 December 1987, Yolanda filed an action with the proper court

praying for a right of way through Anastacia’s property. It was then followed by an
ocular inspection.
On September 5 1991, the trial court dismissed the complaint for lack of
cause of action, explaining that the right of way through Sotero’s property was a
straight path and to allow a detour by cutting through Anastacia’s property would
no longer make the path straight. Hence the trial court concluded that it was more
practical to extend the existing pathway to the public road by removing that portion
of the store blocking the path as that was the shortest route to the public road and
the least prejudicial to the parties concerned than passing through Anastacia’s
property.
Respondent Yolanda appealed and the Court of Appeals reversed the lower
court and held that she was entitled to a right of way on petitioner’s property and
that the way proposed by Yolanda would cause the least damage and detriment to
the servient estate.
ISSUE:
Whether or not there is a valid ground in easement of right of way.
RULING:
As defined, an easement is a real right on another’s property, corporeal and
immovable, whereby the owner of the latter must refrain from doing or allowing
somebody else to do or something to be done on his property, for the benefit of
another person or tenement. It is jus in re aliena, inseparable, indivisible and
perpetual, unless extinguished by causes provided by law. A right of way in
particular is a privilege constituted by covenant or granted by law to a person or
class of persons to pass over another’s property when his tenement is surrounded
by realties belonging to others without an adequate outlet to the public highway.
The owner of the dominant estate can demand a right of way through the servient
estate provided he indemnifies the owner thereof for the beneficial use of his
property.
The conditions sine qua non for a valid grant of an easement of right of way
are: (a) the dominant estate is surrounded by other immovables without an
adequate outlet to a public highway; (b) the dominant estate is willing to pay the
proper indemnity; (c) the isolation was not due to the acts of the dominant estate;
and, (d) the right of way being claimed is at a point least prejudicial to the servient
estate.
The evidence clearly shows that the property of private respondent is

hemmed in by the estates of other persons including that of petitioner; that she
offered to pay P200.00 per square meter for her right of way as agreed between her
and petitioner; that she did not cause the isolation of her property; that the right of
way is the least prejudicial to the servient estate. These facts are confirmed in the
ocular inspection report of the clerk of court, more so that the trial court itself
declared that" the said properties of Antonio Quimen which were purchased by
plaintiff Yolanda Quimen Oliveros were totally isolated from the public highway
and there appears an imperative need for an easement of right of way to the public
highway."
Moreover, Article 650 of the New Civil Code explicitly states that the
easement of right of way shall be established at the point least prejudicial to the
servient estate and, insofar as consistent with this rule, where the distance from the
dominant estate to a public highway may be the shortest. The criterion of least
prejudice to the servient estate must prevail over the criterion of shortest distance
although this is a matter of judicial appreciation. While shortest distance may
ordinarily imply least prejudice, it is not always so as when there are permanent
structures obstructing the shortest distance; while on the other hand, the longest
distance may be free of obstructions and the easiest or most convenient to pass
through. In other words, where the easement may be established on any of several
tenements surrounding the dominant estate, the one where the way is shortest and
will cause the least damage should be chosen. However, as elsewhere stated, if
these two (2) circumstances do not concur in a single tenement, the way which will
cause the least damage should be used, even if it will not be the shortest.
WHEREFORE, no reversible error having been committed by respondent
Court of Appeals, the petition is DENIED and the decision subject of review is
AFFIRMED. Costs against petitioner.
UNISOURCE COMMERCIAL AND DEVELOPMENT

CORPORATION, Petitioner,
vs.
JOSEPH CHUNG, KIAT CHUNG and KLETO CHUNG, Respondents.
G.R. No. 173252. July 17, 2009
SECOND DIVISION
FACTS:
Petitioner Unisource Commercial and Development Corporation is the
registered owner of a parcel of land located in Manila. The title contains a
memorandum of encumbrance of a voluntary easement which has been carried
over from the Original Certificate of Title of Encarnacion S. Sandico.
As Sandico's property was transferred to several owners, the memorandum

of encumbrance of a voluntary easement in favor of Francisco M. Hidalgo was
consistently annotated at the back of every title covering Sandico's. On the other
hand, Hidalgo's property was eventually transferred to respondents Joseph Chung,
Kiat Chung and Cleto Chung.
On May 26, 2000, petitioner filed a Petition to Cancel the Encumbrance of

Voluntary Easement of Right of Way on the ground that the dominant estate has an
adequate access to a public road which is Matienza Street. The trial court
dismissed the petition on the ground that it is a land registration case. Petitioner
moved for reconsideration. Thereafter, the trial court conducted an ocular
inspection of the property. In an Order dated November 24, 2000, the trial court
granted the motion.
The trial Court found that the dominant estate has an egress to Matienza
Street and does not have to use the servient estate.
On the other hand, respondents countered that the extinguishment of the

easement will be of great prejudice to the locality and that petitioner is guilty of
laches since it took petitioner 15 years from acquisition of the property to file the
petition.
On August 19, 2002, the trial court ordered the cancellation of the
encumbrance of voluntary easement of right of way in favor of the dominant estate
owned by respondents since it was found that the dominant estate has no more use
for the easement.
Respondents appealed to the Court of Appeals and it reversed the decision of

the trial court and dismissed the petition to cancel the encumbrance of voluntary
easement of right of way.
ISSUE:
(1) Whether or not the encumbrance of voluntary easement of right of way can be
cancelled by the petitioners who own the servient estate on the ground that that
the dominant estate has an adequate access to a public road.
(2) Whether or not the easement was intended only for the benefit of the owners of
the dominant estate since the annotation did not expressly provides the intention
to bind their heirs and assigns.
RULING:
As defined, an easement is a real right on another's property, corporeal and
immovable, whereby the owner of the latter must refrain from doing or allowing
somebody else to do or something to be done on his property, for the benefit of
another person or tenement. Easements are established either by law or by the will
of the owner. The former are called legal, and the latter, voluntary easements.
1. In this case, the petitioner itself admitted that the existing easement is
voluntary. The opening of an adequate outlet to a highway can extinguish
only legal and compulsory easements, not voluntary easements like in the
case at bar. The fact that an easement by grant may have also qualified as
an easement of necessity does not detract from its permanency as a
property right, which survives the termination of the necessity. The
easement of right of way, like any other contract, could be extinguished
only by mutual agreement or by renunciation of the owner of the
dominant estate. (Art. 631, NCC)
2. Neither can petitioner claim that the easement is personal only to

Hidalgo since the annotation merely mentioned Sandico and Hidalgo
without equally binding their heirs or assigns. That the heirs or assigns of
the parties were not mentioned in the annotation does not mean that it is
not binding on them. Again, a voluntary easement of right of way is like
any other contract. As such, it is generally effective between the parties,
their heirs and assigns, except in case where the rights and obligations
arising from the contract are not transmissible by their nature, or by
stipulation or by provision of law.
Finally, the mere fact that respondents subdivided the property does not
extinguish the easement. Article 618 of the Civil Code provides that if the
dominant estate is divided between two or more persons, each of them may use the
easement in its entirety, without changing the place of its use, or making it more
burdensome in any other way.
WHEREFORE, the instant petition is DENIED. The Decision dated
October 27, 2005 and the Resolution dated June 19, 2006 of the Court of Appeals
in CA-G.R. CV No. 76213 are AFFIRMED.
Classification of Nuisances: Remedies
GUILLERMO M. TELMO, Petitioner,

vs.
LUCIANO M. BUSTAMANTE, Respondent.
G.R. No. 182567. July 13, 2009
THIRD DIVISION
FACTS:
The complaint alleged that respondent is a co-owner of a real property
situated in Brgy. Halang, Naic, Cavite. Petitioner and Elizalde Telmo are the
owners of the two (2) parcels of land located at the back of respondent's lot. When
his lot was transgressed by the construction of the Noveleta-Naic-Tagaytay Road,
respondent Luciano Bustamante offered for sale the remaining lot to the Telmos.
The latter refused because they said they would have no use for it.
On May 8, 2005, it was further alleged that the respondent caused the
resurvey of property of respondent Bustamanete in the presence of the Telmos in
which it showed that the Telmos encroached upon respondent's lot.
On May 10, 2005, respondent put up concrete poles on his lot. However, it
was alleged that the concrete poles were destroyed by Telmos and their men. The
following day, respondent's relatives went to Brgy. Chairman Consumo to report
the destruction of the concrete poles but the Chairman refused to record the same
because he was present when the incident occurred. Consumo never recorded the
incident in the barangay blotter.
ISSUE:
Whether or not the property claimed and enclosed with concrete posts
erected by respondent were a public nuisance under Article 694, paragraph 4 of the
New Civil Code, more particularly a nuisance per se.
RULING:
A nuisance per se is that which affects the immediate safety of persons and
property and may be summarily abated under the undefined law of necessity.
Evidently, the concrete posts summarily removed by petitioner did not at all pose a
hazard to the safety of persons and properties, which would have necessitated
immediate and summary abatement. What they did, at most, was to pose an
inconvenience to the public by blocking the free passage of people to and from the
national road.
WHEREFORE, the Decision dated October 13, 2005 and the Order dated
March 17, 2006 of the Office of the Deputy Ombudsman for Luzon finding
petitioner Guillermo M. Telmo, Municipal Engineer of Naic, Cavite,
administratively culpable for violation of Section 4 of Republic Act No. 6713,
imposing upon him the penalty of fine equivalent to his six 6-month salary, must
be MODIFIED. Guillermo M. Telmo is instead found administratively guilty of
DISCOURTESY IN THE COURSE OF OFFICIAL DUTIES and is hereby
REPRIMANDED. Costs against petitioner.
G.R. No. 177807. October 11, 2011

EMILIO GANCAYCO, Petitioner,
vs.
CITY GOVERNMENT OF QUEZON CITY AND METRO MANILA
DEVELOPMENT AUTHORITY, Respondents.
x - - - - - - - - - - - - - - - - - - - - - - -x
G.R. No. 177933
METRO MANILA DEVELOPMENT AUTHORITY, Petitioner,
vs.
JUSTICE EMILIO A. GANCAYCO (Retired), Respondent,
EN BANC
PONENTE: SERENO, J.:
FACTS:
In the early 1950s, retired Justice Emilio A. Gancayco bought a parcel of
land located at 746 EDSA, Quezon City.
On March 27, 1956, the Quezon City Council issued Ordinance No. 2904,
entitled "An Ordinance Requiring the Construction of Arcades, for Commercial
Buildings to be Constructed in Zones Designated as Business Zones in the Zoning
Plan of Quezon City, and Providing Penalties in Violation Thereof."
In the said ordinance, the city council is required that the arcade is to be
created and thus the building owner is not allowed to construct his wall up to the
edge of the property line, thereby creating a space or shelter under the first floor. In
effect, property owners relinquish the use of the space for use as an arcade for
pedestrians, instead of using it for their own purposes.
The ordinance covered the property of Justice Gancayco in which he sought

the exemption of a two-storey building being constructed on his property from the
application of Ordinance.
On 2 February 1966, the City Council acted favorably on Justice Gancayco's

request and issued Resolution subject to q condition that the owner within the
reasonable subject to the condition that upon notice, within reasonable time,
demolish the enclosure of said arcade at his own expense when public interest so
demands.
On March 2003, the MMDA conducted operations to clear obstructions
along the sidewalk of EDSA in Quezon City pursuant to Metro Manila Council's
Resolution No. 02-28, Series of 2002. It authorized the MMDA and local
government units to "clear the sidewalks, streets, avenues, alleys, bridges, parks
and other public places in Metro Manila of all illegal structures and obstructions."
On 28 April 2003, the MMDA sent a notice of demolition to Justice

Gancayco alleging that a portion of his building violated the National Building
Code of the Philippines in relation to Ordinance No. 2904. He was given 15 days
to clear the portion of the building that was supposed to be an arcade along EDSA.
Justice Gancayco did not comply and the party walls or also known as the
wing walls were demolished.
On 29 May 2003, Justice Gancayco filed a Petition with prayer for a

temporary restraining order and/or writ of preliminary injunction before the RTC
of Quezon City seeking to prohibit the MMDA and the City Government of
Quezon City from demolishing his property. He thus sought the declaration of
nullity of Ordinance No. 2904 and the payment of damages. Alternately, he prayed
for the payment of just compensation should the court hold the ordinance valid.
The RTC rendered its Decision on 30 September 2003 in favor of Justice

Gancayco where the MMDA thereafter appealed from the Decision of the trial
court and claims that the portion of the building in question is a nuisance per se.
On 18 July 2006, the Court of Appeals CA upheld the validity of Ordinance

No. 2904 and lifted the injunction against the enforcement and implementation of
the ordinance.
ISSUE:
Whether or not the wing wall of Justice Gancayao’s building is a public nuisance.
RULING:
The fact that in 1966 the City Council gave Justice Gancayco an exemption from
constructing an arcade is an indication that the wing walls of the building are not
nuisances per se. The wing walls do not per se immediately and adversely affect
the safety of persons and property. The fact that an ordinance may declare a
structure illegal does not necessarily make that structure a nuisance.
Article 694 of the Civil Code defines nuisance as any act, omission,
establishment, business, condition or property, or anything else that (1) injures or
endangers the health or safety of others; (2) annoys or offends the senses; (3)
shock+s, defies or disregards decency or morality; (4) obstructs or interferes with
the free passage of any public highway or street, or any body of water; or, (5)
hinders or impairs the use of property. A nuisance may be per se or per accidens.
A nuisance per se is that which affects the immediate safety of persons and
property and may summarily be abated under the undefined law of necessity.
Clearly, when Justice Gancayco was given a permit to construct the

building, the city council or the city engineer did not consider the building, or its
demolished portion, to be a threat to the safety of persons and property. This fact
alone should have warned the MMDA against summarily demolishing the
structure.
Neither does the MMDA have the power to declare a thing a nuisance. Only
courts of law have the power to determine whether a thing is a nuisance.
We agree with petitioner's contention that, under Section 447(a)(3)(i) of

R.A. No. 7160, otherwise known as the Local Government Code, the
SangguniangPanglungsod is empowered to enact ordinances declaring, preventing
or abating noise and other forms of nuisance. It bears stressing, however, that the
Sangguniang Bayan cannot declare a particular thing as a nuisance per se and order
its condemnation. It does not have the power to find, as a fact, that a particular
thing is a nuisance when such thing is not a nuisance per se; nor can it authorize
the extrajudicial condemnation and destruction of that as a nuisance which in its
nature, situation or use is not such. Those things must be determined and resolved
in the ordinary courts of law. If a thing be in fact, a nuisance due to the manner of
its operation, that question cannot be determined by a mere resolution of the
Sangguniang Bayan.
WHEREFORE, in view of the foregoing, the Decision of the Court of
Appeals in CA-G.R. SP No. 84648 is AFFIRMED.
JAIME S. PEREZ, both in his personal and official capacity as Chief,

Marikina Demolition Office, Petitioner,
vs.
SPOUSES FORTUNITO L. MADRONA and YOLANDA B.
PANTE, Respondents.
G.R. No. 184478. March 21, 2012
FIRST DIVISION
PONENTE: VILLARAMA, JR., J.:
FACTS:
Respondent-spouses FortunitoMadrona and Yolanda B. Pante are registered
owners of a residential property located in Lot 22, Block 5, France Street corner
Italy Street, Greenheights Subdivision, Phase II, Marikina City. In 1989,
respondents built their house thereon and enclosed it with a concrete fence and
steel gate.
Respondents received the letter dated May 25, 1999 from petitioner Jaime S.
Perez, Chief of the Marikina Demolition Office
June 8, 1999, respondent Madrona sent a letter to the petitioner stating that
the May 25, 1999 letter (1) contained an accusation libelous in nature as it is
condemning him and his property without due process; (2) has no basis and
authority since there is no court order authorizing him to demolish their structure;
(3) cited legal bases which do not expressly give petitioner authority to demolish;
and (4) contained a false accusation since their fence did not in fact extend to the
sidewalk.
On July 27, 2004, the RTC rendered a Decision in favor of respondents.
Petitioner appealed the RTC decision to the CA. On March 31, 2008, the
appellate court rendered the assailed decision affirming the RTC decision.
ISSUE:
Whether or not the respondents’ structure is a nuisance per se that presents
immediate danger to the community’s welfare and can be removed without the
need of judicial intervention.
RULING:
In order that an injunction shall be properly issued, two requisites must
concur: first, there must be a right to be protected and second, the acts against
which the injunction is to be directed are violative of said right. Here, the two
requisites are clearly present: there is a right to be protected, that is, respondents’
right over their concrete fence which cannot be removed without due process; and
the act, the summary demolition of the concrete fence, against which the injunction
is directed, would violate said right.
If petitioner indeed found respondents’ fence to have encroached on the

sidewalk, his remedy is not to demolish the same summarily after respondents
failed to heed his request to remove it. Instead, he should go to court and prove
respondents’ supposed violations in the construction of the concrete fence. Indeed,
unless a thing is a nuisance per se, it may not be abated summarily without judicial
intervention. Our ruling in Lucena Grand Central Terminal, Inc. v. JAC Liner,
Inc., on the need for judicial intervention when the nuisance is not a nuisance per
se, is well worth mentioning. In said case, we ruled:
Respondents cannot seek cover under the general welfare clause authorizing
the abatement of nuisances without judicial proceedings. That tenet applies to a
nuisance per se, or one which affects the immediate safety of persons and property
and may be summarily abated under the undefined law of necessity (Monteverde v.
Generoso, 52 Phil. 123 [1982]). The storage of copra in the quonset building is a
legitimate business. By its nature, it cannot be said to be injurious to rights of
property, of health or of comfort of the community. If it be a nuisance per
accidens it may be so proven in a hearing conducted for that purpose. It is not per
se a nuisance warranting its summary abatement without judicial intervention.
Respondents’ fence is not a nuisance per se. By its nature, it is not injurious
to the health or comfort of the community. It was built primarily to secure the
property of respondents and prevent intruders from entering it. And as correctly
pointed out by respondents, the sidewalk still exists. If petitioner believes that
respondents’ fence indeed encroaches on the sidewalk, it may be so proven in a
hearing conducted for that purpose. Not being a nuisance per se, but at most a
nuisance per accidens, its summary abatement without judicial intervention is
unwarranted.
WHEREFORE, the March 31, 2008 Decision and September 10, 2008
Resolution of the Court of Appeals in CA-G.R. CV. No. 83675 are AFFIRMED
with MODIFICATION. Petitioner Jaime S. Perez, Chief of the Demolition Office
of Marikina City is ORDERED to pay respondent Spouses Fortunito L. Madrona
and Yolanda B. Pante moral damages in the amount of ₱10,000.00 and exemplary
damages in the amount of ₱5,000.00.
Effects and Limitation of Donation
REPUBLIC OF THE PHILIPPINES, petitioner,

vs.
DAVID REY GUZMAN, represented by his Attorney-in-Fact, LOLITA G.
ABELA, and the REGISTER OF DEEDS OF BULACAN, MEYCAUAYAN
BRANCH, respondents.
G.R. No. 132964. February 18, 2000
SECOND DIVISION
FACTS:
David Rey Guzman, a natural-born American citizen. His father Simeon is a
naturalized American citizen. When his father died, properties were left in favor of
him and his mother Helen.
Thereafter, Helen and David executed a Deed of Extrajudicial Settlement of

the Estate of Simeon Guzman dividing and adjudicating to themselves all the
property belonging to the estate of Simeon. The document of extrajudicial
settlement was registered in the Office of the Register of Deeds.
Furthermore, a quitclaim was executed by Helen, conveying to him all of her

shares in the property.
On 18 October 1989, David executed a Special Power of Attorney where he

acknowledged that he became the owner of the parcels of land subject of the Deed
of Quitclaim executed by Helen and empowering Atty. Lolita G. Abela to sell or
otherwise dispose of the lots.
On 16 March 1994, Atty. Mario A. Batongbacal wrote the Office of the

Solicitor General and furnished it with documents showing that David’s ownership
of the one-half (1/2) of the estate of Simeon Guzman was defective. On the basis
thereof, the Government filed before the Regional Trial Court of Malolos, Bulacan
a Petition for Escheat praying that one-half (1/2) of David’s interest in each of the
subject parcels of land be forfeited in its favor.
ISSUE:
Whether or not there was a valid transfer of the properties to respondent
David by her mother Helen through a gift or donation inter vivos.
RULING:
There are three (3) essential elements of a donation: (a) the reduction of the
patrimony of the donor; (b) the increase in the patrimony of the donee; and, (c) the
intent to do an act of liberality or animus donandi. When applied to a donation of
an immovable property, the law further requires that the donation be made in a
public document and that there should be an acceptance thereof made in the same
deed of donation or in a separate public document. In cases where the acceptance is
made in a separate instrument, it is mandated that the donor should be notified
thereof in an authentic form, to be noted in both instruments.
By the language of the quitclaims, the intention was a waiver of Helen’s

rights, title and interest over the lands in favour of David and not a donation. That
a donation was far from Helen’s mind. The deeds of quitclaim were in the nature
of public instruments but they did not effect a donation. They lack the essential
element of acceptance to make the valid donation.
Commenting on Art. 633 of the Civil Code from whence Art. 749 came
Manresa said: "If the acceptance does not appear in the same document, it must be
made in another. Solemn words are not necessary; it is sufficient if it shows the
intention to accep, it is necessary that formal notice thereof be given to the donor,
and the fact that due notice has been given must be noted in both instruments. Then
and only then is the donation perfected."
WHEREFORE, the assailed Decision of the Court of Appeals which
sustained the Decision of the Regional Trial Court of Malolos, Bulacan, dismissing
the petition for escheat is AFFIRMED. No costs.
GONZALO VILLANUEVA, represented by his heirs, Petitioner,

vs.
SPOUSES FROILAN and LEONILA BRANOCO, Respondents.
G.R. No. 172804. January 24, 2011
SECOND DIVISION
PONENTE: CARPIO, J.:
FACTS:
Petitioner Gonzalo Villanueva presented by his heirs, sued respondent
spouses Froilan and Leonila Branoco in the Regional Trial Court of Naval, Biliran
to recover a parcel of land in Amambajag, Culaba, Leyte and collect damages.
Petitioner claimed ownership over the Property through purchase in July

1971 from Casimiro Vere, who, in turn, bought the Property from Alvegia Rodrigo
in August 1970.
Respondents similarly claimed ownership over the Property through

purchase in July 1983 from Eufracia Rodriguez to whom Rodrigo donated the
Property in May 1965.
The trial court rejected respondents' claim of ownership after treating the
Deed as a donation mortis causa which Rodrigo effectively cancelled by selling
the Property to Vere in 1970. Thus, by the time Rodriguez sold the Property to
respondents in 1983, she had no title to transfer.
Respondents appealed to the Court of Appeals wherein it was found out that
the Deed as a testamentary disposition was instead a donation inter vivos.
Accordingly, the CA upheld the sale between Rodriguez and respondents, and,
conversely found the sale between Rodrigo and petitioner's predecessor-in-interest,
Vere, void for Rodrigo's lack of title.
ISSUE:
Whether or not the contract between Rodrigo and Rodriguez was a donation
or a devise.
RULING:
It is immediately apparent that Rodrigo passed naked title to Rodriguez
under a perfected donation inter vivos.
First. Rodrigo stipulated that "if the herein Donee predeceases me, the
Property will not be reverted to the Donor, but will be inherited by the heirs of
Rodriguez," signaling the irrevocability of the passage of title to Rodriguez's
estate, waiving Rodrigo's right to reclaim title. This transfer of title was perfected
the moment Rodrigo learned of Rodriguez's acceptance of the disposition which,
being reflected in the Deed, took place on the day of its execution on 3 May 1965.
Rodrigo's acceptance of the transfer underscores its essence as a gift in presenti,
not in futuro, as only donations inter vivos need acceptance by the recipient.
Second. What Rodrigo reserved for herself was only the beneficial title to
the Property, evident from Rodriguez's undertaking to "give one half x xx of the
produce of the land to Apoy Alve during her lifetime." Thus, the Deed's stipulation
that "the ownership shall be vested on Rodriguez upon my demise," taking into
account the non-reversion clause, could only refer to Rodrigo's beneficial title.
Third. The existence of consideration other than the donor's death, such as
the donor's love and affection to the donee and the services the latter rendered,
while also true of devises, nevertheless "corroborates the express irrevocability of
inter vivos transfers." Thus, the CA committed no error in giving weight to
Rodrigo's statement of "love and affection" for Rodriguez, her niece, as
consideration for the gift, to underscore its finding
The petitioner cannot capitalize on Rodrigo's post-donation transfer of the

Property to Vere as proof of her retention of ownership. If such were the barometer
in interpreting deeds of donation, not only will great legal uncertainty be visited on
gratuitous dispositions, this will give license to rogue property owners to set at
naught perfected transfers of titles, which, while founded on liberality, is a valid
mode of passing ownership. The interest of settled property dispositions counsels
against licensing such practice.
Accordingly, having irrevocably transferred naked title over the Property to

Rodriguez in 1965, Rodrigo "cannot afterwards revoke the donation nor dispose of
the said property in favor of another." Thus, Rodrigo's post-donation sale of the
Property vested no title to Vere. As Vere's successor-in-interest, petitioner acquired
no better right than him. On the other hand, respondents bought the Property from
Rodriguez, thus acquiring the latter's title which they may invoke against all
adverse claimants, including petitioner.
WHEREFORE, we DENY the petition. We AFFIRM the Decision dated 6
June 2005 and the Resolution dated 5 May 2006 of the Court of Appeals.

CENTRAL PHILIPPINE UNIVERSITY, petitioner,
vs.
COURT OF APPEALS, REMEDIOS FRANCO, FRANCISCO N. LOPEZ,
CECILIA P. VDA. DE LOPEZ, REDAN LOPEZ AND REMARENE
LOPEZ, respondents.
G.R. No. 112127. July 17, 1995
FIRST DIVISION
FACTS:
Sometime in 1939, when Don Ramon was still a member of the Board of Trustees
of the Central Philippine College (now Central Philippine University [CPU]), he
donated a lot on the condition that the medical school will be constructed therein.
On 31 May 1989, private respondents, who are the heirs of Don Ramon
Lopez, Sr., filed an action for annulment of donation, reconveyance and damages
against CPU alleging that since 1939 up to the time the action was filed the latter
had not complied with the conditions of the donation. Private respondents also
argued that petitioner had in fact negotiated with the National Housing Authority
(NHA) to exchange the donated property with another land owned by the latter.
On 31 May 11991, the trial court held that petitioner failed to comply with
the conditions of the donation and declared it null and void. The court a qua further
directed petitioner to execute a deed of reconveyance of the property in favor of
the heirs of the donor, namely, private respondents herein.
When the petitioner appealed to the Court of Appeals, the Court of Appeals
found that while the first condition mandated petitioner to utilize the donated
property for the establishment of a medical school, the donor did not fix a period
within which the condition must be fulfilled, hence, until a period was fixed for the
fulfillment of the condition, petitioner could not be considered as having failed to
comply with its part of the bargain. Thus, the appellate court rendered its decision
reversing the appealed decision and remanding the case to the court of origin for
the determination of the time within which petitioner should comply with the first
condition annotated in the certificate of title.
ISSUE:
Whether or not the petitioner failed to comply the onerous obligations and
resolutory conditions of the donation annotated at the back of petitioner’s
certificate of title
RULING:
A clear perusal of the condition set forth in the deed of donation executed by
Don Ramon Lopez, Sr., gives us no alternative but to conclude that his donation
was onerous, one executed for a valuable consideration which is considered the
equivalent of the donation itself, e.g., when a donation imposes a burden
equivalent to the value of the donation.
Under Article 1181 of the Civil Code, on conditional obligations, the

acquisition of rights, as well as the extinguishment or loss of those already
acquired, shall depend upon the happening of the event which constitutes the
condition. Thus, when a person donates land to another on the condition that the
latter would build upon the land a school, the condition imposed was not a
condition precedent or a suspensive condition but a resolutory one. It is not correct
to say that the schoolhouse had to be constructed before the donation became
effective, that is, before the donee could become the owner of the land, otherwise,
it would be invading the property rights of the donor. The donation had to be valid
before the fulfillment of the condition. If there was no fulfillment or compliance
with the condition, such as what obtains in the instant case, the donation may now
be revoked and all rights which the donee may have acquired under it shall be
deemed lost and extinguished.
The claim of petitioner that prescription bars the instant action of private
respondents is unavailing. The condition imposed by the donor, i.e., the building of
a medical school upon the land donated, depended upon the exclusive will of the
donee as to when this condition shall be fulfilled. When petitioner accepted the
donation, it bound itself to comply with the condition thereof.
More than a reasonable period of fifty (50) years has already been allowed
petitioner to avail of the opportunity to comply with the condition even if it be
burdensome, to make the donation in its favor forever valid. But, unfortunately, it
failed to do so. Hence, there is no more need to fix the duration of a term of the
obligation when such procedure would be a mere technicality and formality and
would serve no purpose than to delay or lead to an unnecessary and expensive
multiplication of suits. Moreover, under Art. 1191 of the Civil Code, when one of
the obligors cannot comply with what is incumbent upon him, the obligee may
seek rescission and the court shall decree the same unless there is just cause
authorizing the fixing of a period. In the absence of any just cause for the court to
determine the period of the compliance, there is no more obstacle for the court to
decree the rescission claimed.
WHEREFORE, the decision of the Regional Trial Court of Iloilo, Br. 34, of
31 May 1991 is REINSTATED and AFFIRMED, and the decision of the Court of
Appeals of 18 June 1993 is accordingly MODIFIED. Consequently, petitioner is
directed to reconvey to private respondents Lot No. 3174-B-1 of the subdivision
plan Psd-1144 covered by Transfer Certificate of Title No. T-3910-A within thirty
(30) days from the finality of this judgment. Costs against petitioner.
THE INSULAR LIFE ASSURANCE COMPANY, LTD., plaintiff-appellee,

vs.
CARPONIA T. EBRADO and PASCUALA VDA. DE EBRADO, defendants-
appellants.
G.R. No. L-44059. October 28, 1977
FIRST DIVISION
PONENTE: MARTIN, J.:
FACTS:
On September 1, 1968, Buenaventura Cristor Ebrado was issued by The

Insular Life Assurance Co., Ltd., Policy No. 009929 on a whole-life plan for
₱5,882.00 with a rider for Accidental Death Benefits for the same amount.
Buenaventura C. Ebrado designated Carponia T. Ebrado as the revocable
beneficiary in his policy.
On October 21, 1969, Buenventura C. Ebrado died as a result of an accident

when he was hit by a falling branch of a tree. As the insurance policy was in force,
The Insular Life Assurance Co., Ltd. stands liable to pay the coverage of the policy
representing the face value of the plus the additional benefits for accidental death
and refund paid for the premium due November, 1969, minus the unpaid premiums
and interest thereon due for January and February, 1969.
Carponia T. Ebrado filed with the insurer a claim for the proceeds of the
policy as the designated beneficiary therein, although she admits that she and the
insured Buenaventura C. Ebrado were merely living as husband and wife without
the benefit of marriage. Pascuala Vda. De Ebrado also filed her claim as the widow
of the deceased insured. She asserts that she is the one entitled to the insurance
proceeds, not the common-law wife, Carponia T. Ebrado.
On April 29, 1970, the Insular Life Assurance Co., Ltd. commenced an
action for Interpleader before the Court of First Instance of Rizal since they are in
doubt as to whom the proceeds will be given.
The trial court rendered its decision declaring Capronia T. Ebrado

disqualified as a beneficiary.
ISSUE:
Whether or not a common-law wife named as beneficiary in the life
insurance policy of a legally married man claim the proceeds thereof in case of
death of the latter.
RULING:
Under Article 2012 of the Civil Code, "any person who is forbidden from
receiving any donation under Article 739
cannot be named beneficiary of a life insurance policy by the person who cannot
make a donation to him." Common-law spouses are, definitely, barred from
receiving donations from each other. Article 739 of the new Civil Code provides
the following donations shall be void:
1) Those made between persons who were guilty of adultery or concubinage at

the time of donation;
2) Those made between persons found guilty of the same criminal offense, in
consideration thereof;
3) Those made to a public officer or his wife, descendants or ascendants by
reason of his office.
In the case referred to in No. 1, the action for declaration of nullity may be
brought by the spouse of the donor or donee; and the guilt of the donee may
be proved by preponderance of evidence in the same action.
In essence, a life insurance policy is no different from a civil donation

insofar as the beneficiary is concerned. Both are founded upon the same
consideration: liberality. A beneficiary is like a donee, because from the premiums
of the policy which the insured pays out of liberality, the beneficiary will receive
the proceeds or profits of said insurance. As a consequence, the proscription in
Article 739 of the new Civil Code should equally operate in life insurance
contracts. The mandate of Article 2012 cannot be laid aside: any person who
cannot receive a donation cannot be named as beneficiary in the life insurance
policy of the person who cannot make the donation.
Policy considerations and dictates of morality rightly justify the institution

of a barrier between common-law spouses in regard to property relations since
such relationship ultimately encroaches upon the nuptial and filial rights of the
legitimate family. There is every reason to hold that the bar in donations between
legitimate spouses and those between illegitimate ones should be enforced in life
insurance policies since the same are based on similar consideration. As above
pointed out, a beneficiary in a life insurance policy is no different from a donee.
Both the recipients of pure beneficence. So long as marriage remains the threshold
of family laws, reason and morality dictate that the impediments imposed upon
married couple should likewise be imposed upon extra-marital relationship. If
legitimate relationship is circumscribed by these legal disabilities, with more
reason should an illicit relationship be restricted by these disabilities.
ACCORDINGLY, the appealed judgment of the lower court is hereby
affirmed. Carponia T. Ebrado is hereby declared disqualified to be the beneficiary
of the late Buenaventura C. Ebrado in his life insurance policy. As a consequence,
the proceeds of the policy are hereby held payable to the estate of the deceased
insured. Costs against Carponia T. Ebrado.
ZAMBOANGA BARTER TRADERS KILUSANG BAYAN, INC.

represented by its President, ATTY. HASAN G. ALAM, Petitioner,
vs.
HON. JULIUS RHETT J. PLAGATA, in his capacity as Executive Labor
Arbiter of NLRC-RAB No. IX, SHERIFF DANILO P. TEJADA of NLRC-
RAB No. IX and TEOPISTO MENDOZA, Respondents.
G.R. No. 148433. September 30, 2008
THIRD DIVISION
PONENTE: CHICO-NAZARIO, J.:

FACTS:
On 17 June 1981, ZBTKBI, thru its President, Atty. Hassan G. Alam, and
the Republic of the Philippines, represented by Maj. Gen. Delfin C. Castro entered
into a Deed of Donation whereby ZBTKBI donated to the Republic a parcel of
land situated in the Barrio of Canelar, City of Zamboanga, The Republic accepted
the donation upon certain conditions. Among the following are to construct a ₱5
Million Barter Trade market which shall accommodate at least 1,000 stalls and the
allocation of which shall be determined by the Executive Committee for Barter
Trade in coordination with the Officers and Board of Directors the Zamboanga
Barter Traders' Kilusang Bayan, Inc., provided, however, that each member of the
DONOR shall be given priority. In cases where in the event of the barter trade was
phased-out, prohibited or suspended, the donor shall have the right to purchase the
improvements made in the said property.
A Barter Trade Market Building worth ₱5,000,000.00 at the said lot. On 30

March 1983, the building was completed and was occupied by members of
ZBTKBI, as well as by other persons engaged in barter trade.
On 17 June 1988, the barter area was totally phased out by the President of
the Republic by virtue of memorandum circular.
Petitioner argues effective October 1, 1988, the donated property was no

longer owned by the Republic of the Philippines having violated one of the
conditions. It was explicitly stated that any violation as to the condition shall revert
back the donation in favor of the donors.
As found by the Court of Appeals, Atty. Hasan G. Alam subscribed to the

legal reality that ZBTKBI was the owner of the subject land when he wrote Lt.
Gen. Ruperto A. Ambil, Jr. of the Southern Command on 6 February 1996,
requesting the return of the original TCT covering the property. It should be clear
that reversion applied only to the land and not to the building and improvements
made by the Republic on the land worth ₱5,000,000.00.
ISSUE:
Whether or not a stipulation of automatic reversion in a deed of donation
valid.
RULING:
The deed of donation contains a stipulation that allows automatic reversion. Such
stipulation, not being contrary to law, morals, good customs, public order or public
policy, is valid and binding on the parties to the donation.
As held in Dolar v. Barangay Lublub (Now P.D. Monfort North)

Municipality of Dumangas, citing Roman Catholic Archbishop of Manila v. Court
of Appeals
When a deed of donation expressly provides for automatic revocation and

reversion of the property donated, the rules on contract and the general rules on
prescription should apply, and not Article 764 of the Civil Code. Since Article
1306 of said Code authorizes the parties to a contract to establish such stipulations,
not contrary to law, public order or public policy, we are of the opinion that, at the
very least, that stipulation of the parties providing for automatic revocation of the
deed of donation, without prior judicial action for that purpose, is valid subject to
the determination of the propriety of the rescission sought. Where such propriety is
sustained, the decision of the court will be merely declaratory of the revocation,
but it is not in itself the revocatory act.
The automatic reversion of the subject land to the donor upon phase out of
barter trading in Zamboanga City cannot be doubted. Said automatic reversion
cannot be averted, merely because petitioner-donor has not yet exercised its option
to purchase the buildings and improvements made and introduced on the land by
the Republic; or because the Republic has not yet sold the same to other interested
buyers. Otherwise, there would be gross violation of the clear import of the
conditions set forth in the deed of donation.
WHEREFORE, all the foregoing considered, the instant petition is
DENIED. The decision of the Court of Appeals dated 20 November 2000 in CA-
G.R. SP No. 59520 is AFFIRMED.
ALFONSO QUIJADA, CRESENTE QUIJADA, REYNELDA QUIJADA,

DEMETRIO QUIJADA, ELIUTERIA QUIJADA, EULALIO QUIJADA, and
WARLITO QUIJADA, petitioners,
vs.
COURT OF APPEALS, REGALADO MONDEJAR, RODULFO
GOLORAN, ALBERTO ASIS, SEGUNDINO RAS, ERNESTO GOLORAN,
CELSO ABISO, FERNANDO BAUTISTA, ANTONIO MACASERO, and
NESTOR MAGUINSAY, respondents.
G.R. No. 126444. December 4, 1998
SECOND DIVISION
PONENTE: MARTINEZ, J.:
FACTS:
Herein petitioners are the children of the late Trinidad Corvera Vda. De
Quijada. Trinidad was one of the heirs of the late Pedro Corvera and inherited from
the latter the two-hectare parcel of land subject of the case, situated in the barrio of
San Agustin, Talacogon, Agusan del Sur.
On April 5, 1956, Trinidad Quijada together with her siblings executed a

conditional deed of donation of the two-hectare parcel of land subject of the case in
favor of the Municipality of Talacogon. The donation is subject to a resolutory
condition in which Provincial High School should be constructed therein and it
would be exclusively used for school purposes. Any violation of the agreement
shall tantamount to the forfeiture of the said donation. Apparently, Trinidad
remained in possession of the parcel of land despite the donation.
On July 29, 1962, Trinidad sold the two hectares of land to Mondejar
without the benefit of the written Deed of Sale.
In 1980, the heirs of Trinidad filed a complaint for forcible entry against
Regalado Mondejar but it was dismissed.
In 1987, the Sangguniang Bayan of the Municipality of Talacogon enacted a

resolution reverting the two (2) hectares of land donated back to the donors since
the school was not constructed. In the meantime, Regalado Mondejar sold portions
of the land to Fernando Bautista, Rodolfo Goloran, Efren Guden and Ernesto
Goloran.
On July 5, 1988, petitioners filed this action against the respondents. In the
complaint, petitioners alleged that their deceased mother never sold, conveyed,
transferred or disposed of the property in question to any person or entity much
less to Regalado Mondejar save the donation made to the Municipality of
Talacogon in 1956. They averred the the sale was null and void.
ISSUE:
Whether the deed of donation had a suspensive condition or a resolutory
condition
RULING:
It has been ruled that when a person donates land to another on the condition
that the latter would build upon the land a school, the condition imposed is not a
condition precedent or a suspensive condition but a resolutory one. Thus, at the
time of the sales made in 1962 towards 1968, the Trinidad could not have sold the
lots since she had earlier transferred ownership thereof by virtue of the deed of
donation. So long as the resolutory condition subsists and is capable of fulfillment,
the donation remains effective and the donee continues to be the owner subject
only to the rights of the donor or his successors-in-interest under the deed of
donation. Since no period was imposed by the donor on when must the donee
comply with the condition, the latter remains the owner so long as he has tried to
comply with the condition within a reasonable period. Such period, however,
became irrelevant herein when the donee-Municipality manifested through a
resolution that it cannot comply with the condition of building a school and the
same was made known to the donor. Only then — when the non-fulfillment of the
resolutory condition was brought to the donor’s knowledge — that ownership of
the donated property reverted to the donor as provided in the automatic reversion
clause of the deed of donation.
The donor may have an inchoate interest in the donated property during the
time that ownership of the land has not reverted to her. Such inchoate interest may
be the subject of contracts including a contract of sale. In this case, however, what
the donor sold was the land itself which she no longer owns. It would have been
different if the donor-seller sold her interests over the property under the deed of
donation which is subject to the possibility of reversion of ownership arising from
the non-fulfillment of the resolutory condition.
WHEREFORE, by virtue of the foregoing, the assailed decision of the Court
of Appeals is AFFIRMED.

Jaime Abalos and Spouses Felix Salazar and Consuelo Salazar

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Possession in Good Faith and Bad Faith

PHILIPPINE NATIONAL BANK, petitioner,

PONENTE: VITUG, J.:

SAMUEL PARILLA, CHINITA PARILLA and DEODATO

PONENTE: CARPIO MORALES, J.:

Despite demands to vacate, petitioners and the other occupants remained in

Jurisprudence is replete with cases which categorically declare that Article

JAIME ABALOS and SPOUSES FELIX SALAZAR and CONSUELO

PONENTE: PERALTA, J.:

PRECY BUNYI and MILA BUNYI, Petitioners,

PONENTE: QUISUMBING, J.:

On December 9, 1975, the children of Constantino Factor and Maura

On January 15, 2001, Gloria died. The administration and management of

On September 12, 2003, respondent Fe S. Factor filed a complaint for

THE PEOPLE OF THE PHILIPPINES, appellee,

PONENTE: TINGA, J.:

Knowledge refers to a mental state of awareness of a fact. Since courts

Appellant failed to satisfactorily establish his lack of knowledge of

MARK SOLEDAD y CRISTOBAL, Petitioner,

PONENTE: NACHURA, J.:

Private complainant Jefferson Devilleres lodged a complaint with the

On appeal, the CA affirmed petitioner's conviction.

The trial court convicted petitioner of possession of the credit card

CRISTETA CHUA-BURCE, petitioner,

PONENTE: QUISUMBING, J.:

During this initial cash count, they discovered a shortage of ₱150,000.00.

On November 4, 1985, unable to satisfactorily explain the shortage of

Juridical possession means a possession which gives the transferee a right

Petitioner herein being a mere cash custodian had no juridical possession

EDCA PUBLISHING & DISTRIBUTING CORP., petitioner,

PONENTE: CRUZ, J.:

Meanwhile, EDCA having become suspicious over a second order placed by

BPI FAMILY BANK, Petitioner,

PONENTE: NACHURA, J.:

On August 15, 1989, Tevesteco Arrastre-Stevedoring Co., Inc. opened a

On August 31, 1989, Franco opened three accounts, namely, a current,

It appears, however, that the signatures of FMIC's officers on the Authority

On August 4, 1993, the Manila RTC rendered judgment in favor of Franco

PONENTE: VITUG, J.:

The above restrictions were also contained in Transfer Certificate of Title

The controversy arose when petitioners, despite repeated warnings from

The provisions in a restrictive covenant prescribing the type of the building

There appears to be no cogent reasons for not upholding restrictive

In sum, the Court holds that —

CONCORDIO ABELLANA, SR., PEDRO E. MENDEZ, VERANO

PONENTE: GRIÑO-AQUINO, J.:

BICOL AGRO-INDUSTRIAL PRODUCERS COOPERATIVE, INC.

PONENTE: PERALTA, J.:

PONENTE: NACHURA, J.:

Sometime in the 1960s, Perfecta bought a lot, located at Inayawan, Cebu

Petitioners, thus, sought the imposition of an easement of right of way, six

In this case, the fourth requisite is absent.

As between a right of way that would demolish a fence of strong materials to

ANASTACIA QUIMEN, petitioner,

PONENTE: BELLOSILLO, J.:

On 29 December 1987, Yolanda filed an action with the proper court

The evidence clearly shows that the property of private respondent is

UNISOURCE COMMERCIAL AND DEVELOPMENT

PONENTE: QUISUMBING, J.:

As Sandico's property was transferred to several owners, the memorandum

On May 26, 2000, petitioner filed a Petition to Cancel the Encumbrance of

On the other hand, respondents countered that the extinguishment of the

Respondents appealed to the Court of Appeals and it reversed the decision of

2. Neither can petitioner claim that the easement is personal only to