Property Law Midterms Reviewer
Gasgonia
CLASSIFICATION OF PROPERTY (Arts. 414-426)
Preliminary provisions
Art. 414. All things which are or may be the object of
appropriation are considered either:
(1) Immovable or real property; or

(2) Movable or personal property. (333)
Immovable property (ATFS-MAF-MDC)
Art. 415. The following are immovable property:
(1) Land, buildings, roads and constructions of all kinds
adhered to the soil;
(2) Trees, plants, and growing fruits, while they are attached
to the land or form an integral part of an immovable;
(3) Everything attached to an immovable in a fixed manner, in
such a way that it cannot be separated therefrom without
breaking the material or deterioration of the object;
(4) Statues, reliefs, paintings or other objects for use or
ornamentation, placed in buildings or on lands by the owner
of the immovable in such a manner that it reveals the
intention to attach them permanently to the tenements;
(5) Machinery, receptacles, instruments or implements
intended by the owner of the tenement for an industry or
works which may be carried on in a building or on a piece of
land, and which tend directly to meet the needs of the said
industry or works;
(6) Animal houses, pigeon-houses, beehives, fish ponds or
breeding places of similar nature, in case their owner has
placed them or preserves them with the intention to have
them permanently attached to the land, and forming a
permanent part of it; the animals in these places are included;
(7) Fertilizer actually used on a piece of land;
(8) Mines, quarries, and slag dumps, while the matter thereof
forms part of the bed, and waters either running or stagnant; 
 bookcase, the item is a fixture.
(9) Docks and structures which, though floating, are intended
by their nature and object to remain at a fixed place on a river,
lake, or coast;
(10) Contracts for public works, and servitudes and other real
rights over immovable property. (334a)
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Art. 415 (1) Land, buildings, roads and constructions of all
kinds adhered to the soil
‣ Are squatter shanties “adhered to the soil?” NO!
Art. 415 (2) Trees, plants, and growing fruits, while they are
attached to the land or form an integral part of an immovable
‣ Are growing fruits already identified for harvest
immovable?

If still growing and still attached to the land, YES.
Art. 415 (3) Everything attached to an immovable in a fixed
manner, in such a way that it cannot be separated therefrom
without breaking the material or deterioration of the object
‣ M-A-R-I-A: How to determine personal property is a
fixture (https://www.thebalance.com/what-are-house-
fixtures-1798755)
1. Method of attachment. Is the item permanently affixed
to the wall, ceiling, or flooring by using nails, glue,
cement, pipes, or screws? Even if you can easily remove
it, the method used to attach it might make it a fixture.
For example, ceiling lights, although attached by wires,
can be removed, but the lights are a house fixture.
2. Adaptability. If the item becomes an integral part of the
home, it cannot be removed. For example, a floating
laminate floor is a fixture, even though it is snapped
together. One could argue that a built-in Sub Zero
refrigerator is considered a fixture, although it can be
unplugged, because it fits inside a specified space. 

3. Relationship of the parties. If the dispute is between
tenant and landlord, the tenant is likely to win. If the
dispute is between buyer and seller, the buyer is likely to
prevail.

4. Intention of party when the item was attached. When the
installation took place, if the intent was to make the item
a permanent attachment, for example, a built-in
 

5. Agreement between the parties. Read your purchase
contract. Most contain a clause that expressly defines
items included in the sale and ordinarily state." All
existing fixtures and fittings that are attached to the
property.
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Property Law Midterms Reviewer
Art. 415 (4) Statues, reliefs, paintings or other objects for use
or ornamentation, placed in buildings or on lands by the
owner of the immovable in such a manner that it reveals the
intention to attach them permanently to the tenements
 
(5) Machinery, receptacles, instruments or implements
intended by the owner of the tenement for an industry or
works which may be carried on in a building or on a piece of
land, and which tend directly to meet the needs of the said
industry or works
 
‣ Are pipes laid by Maynilad immovable?  YES.
Art. 415 (6) Animal houses, pigeon-houses, beehives, fish
ponds or breeding places of similar nature, in case their
owner has placed them or preserves them with the intention
to have them permanently attached to the land, and forming a
permanent part of it; the animals in these places are included
 
Art. 415 (7) Fertilizer actually used on a piece of land
 
Art. 415 (8) Mines, quarries, and slag dumps, while the matter
thereof forms part of the bed, and waters either running or
stagnant
 
‣ Are mineral rocks immovable property? YES!
Art. 415 (9) Docks and structures which, though floating, are
intended by their nature and object to remain at a fixed place
on a river, lake, or coast
 
‣ Are the docks at the Batangas Port immovable property?  A lessee placed machinery in a building erected on land
YES.
 belonging to another, with the understanding that the
‣ Are the floating houses in a Badjao village considered
immovable property? 
 the land leased. The lessee also treated the machinery as


YES! (They should be assessed for real estate taxes! LOL)
Art. 415 (10) Contracts for public works, and servitudes and
other real rights over immovable property.
Machinery
A factory building [and the machinery attached thereto] is real
property, and the mere fact that it is mortgaged and sold,
separate and apart from the land on which it stands, in no
wise changes its character as real property. (Leung Yee vs. F.
L. Strong Machinery Co. and Williamson, No. 11658, February
15, 1918, 37 Phil. 644)
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Contract
The efficacy of the act of recording a chattel mortgage
consists in the fact that registration operates as constructive
notice of the existence of the contract, and the legal effects
of the instrument must be discovered in the document itself,
in relation with the fact of notice. Registration adds nothing
to the instrument, considered as a source of title, and affects
nobody's rights except as a species of constructive notice.
For the purpose of applying the Chattel Mortgage Law, parties
to a contract may, by agreement, treat as personal property
that which by nature would be a real property. (Standard Oil
Co. of New York vs. Jaramillo, No. 20329, March 16, 1923, 44
Phil. 630)
Real as personal
Under Art 415, Civil Code, the inclusion of a building separate
and distinct from the land means that a building is by itself an
immovable property.
While a mortgage of land necessarily includes buildings, a
building by itself may be mortgaged apart from the land on
which it has been built. Mortgage is still a real estate
mortgage for the building would still be considered
immovable property even if dealt with separately from the
land. Possessory rights over property before title is vested on
the grantee may be validly transferred as in a deed of
mortgage. (Prudential Bank vs. Panis, No. L-50008, August 31,
1987, 153 SCRA 390)
Mortgage
machinery was not included in the improvements which
would pass to the lessor on the expiration or abandonment of
personal property by executing chattel mortgages in f favor
of third persons. The machinery was levied upon by the
sheriff as personalty pursuant to a writ of execution obtained
without any protest being registered. Held: That the
machinery must be classified as personal property.
Machinery which is movable in its nature only becomes
immobilized when placed in a plant by the owner of the
property or plant, but not when so placed by a tenant, a
usufructuary, or any person having only a temporary right,
unless such person acted as the agent of the owner. (Davao
Saw Mill Co. vs. Castillo, No. 40411, August 7, 1935, 61 Phil.
790).
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Growing fruits
Paragraph 2 of Article 334 of the [Old]Civil Code enumerates
as real property the following:
“Trees, plants, and ungathered products, while they are
annexed to the land or form an integral part of any immovable
property.”
Said article, however, has received in recent years an
interpretation by the Tribunal Supremo de España, which holds
that, under certain conditions, growing crops may be
considered as personal property.
Growing sugar cane is considered personal property and not
real property and is subject to attachment and sale. Act No.
1508, the Chattel Mortgage Law, provides that all personal
property shall be subject to mortgage. At common law all
annual crops which are raised by yearly manurance and labor
and essentially owe their existence to cultivation may be
levied on as personal property.
For the purpose of attachment and execution and for the
purposes of the Chattel Mortgage Law, "ungathered products"
have the nature of personal property. (Sibal vs. Valdez, No.
26278, August 4, 1927, 50 Phil. 512)
Machinery
Machinery bolted to the ground may be seized under a search
warrant if its owner is not the owner of the land on which it
has been placed for then it is classified as movable property.
(Burgos, Sr. vs. Chief of Staff, AFP, No. L-64261, December 26,
1984, 133 SCRA 800)
Steel towers
The steel towers of an electric company do not constitute real
property for the purpose of the real property tax.
The term "pole" refers to an upright standard to the top of
which something is affixed or by which something is
supported, and includes a steel tower of an electric power
company, like the Meralco.
The tax exemption privilege of the Meralco on its poles, as
granted by its franchise (Act No. 484), is held to include its
steel towers. (Board of Assessment Appeals vs. Manila Electric
Company, No. L-15334, January 31, 1964, 10 SCRA 68)
Oil storage tanks
Storage tanks although not embedded on land considered as
improvements and are subject to realty tax.
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For purposes of taxation, the term “real property” may include
things which should generally be regarded as personal
property. It is a familiar phenomenon to see things classed as
real property for purposes of taxation which on general
principle might be considered personal property. (Manila
Electric Co. vs. Central Board of Assessment Appeals, No.
L-47943, May 31, 1982, 114 SCRA 273)
Pipeline
Pipeline System of Meralco Securities classified as real
property and subject to tax they being machinery or
improvements. It does not fall within the classes of exempt
real property.
Section 2 of the Assessment Law provides that the realty tax
is due “on real property, including land, buildings, machinery,
and other improvements” not specifically exempted in section
3 thereof. It is incontestable that the pipeline of Meralco
Securities does not fall within any of the classes of exempt
real property enumerated in section 3 of the Assessment Law
and section 40 of the Real Property Tax Code.
The Petroleum Law (Petroleum Act of 1949, Republic Act No.
387) does not exempt Meralco Securities from payment of
realty taxes. (Meralco Securities Industrial Corporation vs.
Central Board of Assessment Appeals, 114 SCRA 260)
Movable property
Art. 416. The following things are deemed to be personal
property:
(1) Those movables susceptible of appropriation which are
not included in the preceding article;
(2) Real property which by any special provision of law is
considered as personal property;
(3) Forces of nature which are brought under control by
science; and
(4) In general, all things which can be transported from place
to place without impairment of the real property to which they
are fixed.
Electricity
A person to whom an electric light company furnishes electric
current for lighting purposes, and who, by means of a
"jumper," uses electricity which does not pass through the
meter installed for the purpose of measuring the current
used, thus depriving the company of such electric current, is
guilty of larceny.
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Property Law Midterms Reviewer
Article 517 of the Penal Code above referred to reads as
follows:
"The following are guilty of larceny:
(1) Those who with intent of gain and without violence or
intimidation against the person, or force against things, shall
take another's personal property without the owner's
consent.” x x x (United States vs. Carlos, No. 6295. September
1, 1911, 21 Phil., 553)
Telephone service
The Court ruled in Laurel v. Abrogar (G.R. No. 155076, January
13, 2009) that “any personal property, tangible or intangible,
corporeal or incorporeal, capable of appropriation can be the
object of theft.” This jurisprudence, in turn, applied the
prevailing legal meaning of the term “personal property”
under Art. 335 of the old Civil Code as “anything susceptible
of appropriation and not included in the foregoing chapter
(not real property).”
PLDT’s telephone service or its business of providing this was
appropriable personal property and was, in fact, the subject
of appropriation in an ISR operation, facilitated by means of
the unlawful use of PLDT’s facilities. (PLDT vs. Alvarez, G.R.
No. 179408, March 5, 2014, 18 SCRA 54)
Movable property: Obligations, actions, stocks
Art. 417. The following are also considered as personal
property:
(1) Obligations and actions which have for their object
movables or demandable sums; and
(2) Shares of stock of agricultural, commercial and industrial
entities, although they may have real estate.
Interest in a business is a personal property
An interest in a business may be the subject of mortgage, for
it is a personal property, being capable of appropriation, and
not included among the real properties enumerated in article
335 of the [old] Civil Code. (Strochecker vs Ramirez, 44 Phil.
933 [1922])
Consumable, non-consumable
Art. 418. Movable property is either consumable or non-
consumable. To the first class belong those movables which
cannot be used in a manner appropriate to their nature
without their being consumed; to the second class belong all
the others. (337)
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Subclassification of movables based on consumability
1. Consumable - those movables which cannot be used in a
manner appropriate to their nature without their being
consumed (Examples: food, electricity, cellphone “load”)

2. Non-consumable - all other movables (Examples: jewelry,
cars, clothes)
Subclassification of movables based on fungibility
1. Fungible - things which have no distinct individuality, and
may therefore be substituted with another item of equal
quantity and quality, either by nature or the will of the
parties (Examples: money, a barong)

2. Non-fungible - things which have distinct individuality,
and may therefore not be substituted with another item
of equal quantity and quality (Example: the barong worn
by President Magsaysay at his inaugural)
Property in relation to to the person whom it belongs
Art. 419. Property is either of public dominion or of private
ownership. (338)
State property
It is true that the City of Manila as well as its predecessor, the
Ayuntamiento de Manila, could validly acquire property in its
corporate or private capacity, following the accepted doctrine
on the dual character—public and private—of a municipal
corporation. And when it acquires property in its private
capacity, it acts like an ordinary person capable of entering
into contracts or making transactions for the transmission of
title or other real rights. In the absence of title deed to any
land claimed by the City of Manila as its own, showing that it
was acquired with its private or corporate funds, the
presumption is that such land came from the State upon the
creation of the municipality.
Communal lands or “legua comunal” came into existence
when a town or pueblo was established in this country under
the laws of Spain. The municipalities of the Philippines were
not entitled, as a matter of right, to any part of the public
domain for use as communal lands. The Spanish law provided
that the usufruct of a portion of the public domain adjoining
municipal territory might be granted by the government for
communal purposes, upon proper petition, but until granted,
no rights therein passed to the municipalities, and, in any
event, the ultimate title remained in the sovereign.
It may be laid down as a general rule that regardless of the
source or classification of land in the possession of a
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municipality, excepting those acquired with its own funds in
its private or corporate capacity, such property is held in trust
for the State for the benefit of its inhabitants, whether it be
for governmental or proprietary purposes. It holds such lands
subject to the paramount power of the legislature to dispose
of the same, for after all it owes its creation to it as an agent
for the performance of a part of its public work, the
municipality being but a subdivision or instrumentality
thereof for purposes of local administration. (Salas vs.
Jarencio, No. L-29788, August 30, 1972, 46 SCRA 734)
Reclassification
Section 6 of Commonwealth Act No. 141, as amended,
provides that the classification and reclassification of public
lands into alienable or disposable, mineral or forest land is
the prerogative of the Executive Department.
Under the Regalian doctrine, which is embodied in our
Constitution, all lands of the public domain belong to the
State, which is the source of any asserted right to any
ownership of land. All lands not appearing to be clearly within
private ownership are presumed to belong to the State.
Accordingly, public lands not shown to have been reclassified
or released as alienable agricultural land or alienated to a
private person by the State remain part of the inalienable
public domain.
Public dominion (U-S-W)
Art. 420. The following things are property of public
dominion:
(1) Those intended for public use, such as roads, canals,
rivers, torrents, ports and bridges constructed by the State,
banks, shores, roadsteads, and others of similar character;
(2) Those which belong to the State, without being for public
use, and are intended for some public service or for the
development of the national wealth. (See Art. XII, Sec. 2, 1987
Constitution)
Paras comments:
Public dominion means ownership by the State in that the
State has control and administration; in another sense, public
dominion means ownership by the public in general, in that
not even the State or subdivisions thereof may make them
the object of commerce as long as they remain properties for
public use. Such is the case, for example, of a river or a town
plaza.
Mere possession of land does not by itself automatically
divest the land of its public character. (Republic vs. Lat Vda.
De Castillo, et al., GR 69002, June 30, 1988)
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Atty. Donna Z. Gasgonia
‣ Are rivers whether navigable or not, properties of public
dominion? 



It would seem that Art. 420 makes no distinction. (Short
answer: YES!; Longer, qualified answer: Navigable rivers,
naturally used for commerce, are public property.
‣ Can rivers become private property when converted into
fishponds? 

NO! Navigable rivers converted into fishponds remain
public property. The fishponds can be demolished anytime.
(Martinez vs. Court of Appeals L-31271, Apr. 29, 1974, 56
SCRA 647) 

‣ The Municipal Council of Cavite in 1907 withdrew and
excluded from public use a part of its plaza in order to
lease same for the benefit of defendant Rojas. Is the lease
valid?



NO! The lease is null and void, because streets and plazas
are outside the commerce of man, since they are
properties for public use. In creating the lease, the
municipality exceeded its authority because it did
something it was not empowered to do.
Port
The airport lands and buildings of Manila International Airport
Authority (MIAA) are properties of public dominion intended
for public use; and as such are exempt from real property tax
under Section 234(a) of the Local Government Code (LGC).
Only those portions of the Ninoy Aquino International Airport
(NAIA) Pasay properties which are leased to taxable persons
like private parties are subject to real property tax by the City
of Pasay. (Manila International Airport Authority vs. City of
Pasay, G.R. No. 163072, April 2, 2009, 583 SCRA 234)
Submerged lands
The ownership of lands reclaimed from foreshore and
submerged areas is rooted in the Regalian doctrine which
holds that the State owns all lands and waters of the public
domain.
After the effectivity of the 1935 Constitution, government
reclaimed and marshy disposable lands of the public domain
continued to be only leased and not sold to private parties.
These lands remained sui generis, as the only alienable or
disposable lands of the public domain the government could
not sell to private parties.
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Until now, the only way the government can sell to private
parties government reclaimed and marshy disposable lands
of the public domain is for the legislature to pass a law
authorizing such sale. CA No. 141 does not authorize the
President to reclassify government reclaimed and marshy
lands into other non-agricultural lands under Section 59 (d).
Lands classified under Section 59 (d) are the only alienable or
disposable lands for non-agricultural purposes that the
government could sell to private parties.
In order for PEA to sell its reclaimed foreshore and
submerged alienable lands of the public domain, there must
be legislative authority empowering PEA to sell these lands,
though any legislative authority granted to PEA to sell its
reclaimed alienable lands of the public domain would be
subject to the constitutional ban on private corporations from
acquiring alienable lands of the public domain, such
legislative authority could only benefit private individuals.
Foreshore and submerged areas “shall not be alienated,”
unless they are classified as “agricultural lands” of the public
domain. The mere reclamation of certain areas by PEA does
not convert these inalienable natural resources of the State
into alienable or disposable lands of the public domain—there
must be a law or presidential proclamation officially
classifying these reclaimed lands as alienable or disposable
and open to disposition or concession.
Under the Spanish Law of Waters of 1866, a private person
reclaiming from the sea without permission from the State
could not acquire ownership of the reclaimed land which
would remain property of public dominion like the sea it
replaced.
As manager, conservator and overseer of the natural
resources of the State, DENR exercises “supervision and
control over alienable and disposable public lands.” PEA
needs authorization from DENR before PEA can undertake
reclamation in Manila Bay, or in any part of the country. DENR
is vested with the power to authorize the reclamation of areas
under water, while PEA is vested with the power to undertake
the physical reclamation of areas under water, whether
directly or through private contractors.
Absent two official acts—a classification that these lands are
alienable or disposable and open to disposition and a
declaration that these lands are not needed for public service,
lands reclaimed by PEA remain inalienable lands of the public
domain. (Chavez vs. Public Estates Authority, G.R. No. 133250.
July 9, 2002, 384 SCRA 152)
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Submerged lands are owned by the State and are inalienable.
Section 2, Article XII of the 1987 Constitution provides: “All
lands of the public domain, waters, minerals, coal, petroleum,
and other mineral oils, all forces of potential energy, fisheries,
forests or timber, wildlife, flora and fauna, and other natural
resources are owned by the State. With the exception of
agricultural lands, all other natural resources shall not be
alienated. x x x. Submerged lands, like the waters (sea or bay)
above them, are part of the State’s inalienable natural
resources. Submerged lands are property of public dominion,
absolutely inalienable and outside the commerce of man.
This is also true with respect to foreshore lands. Any sale of
submerged or foreshore lands is void being contrary to the
Constitution.
Reclaimed lands are no longer foreshore or submerged lands,
and thus may qualify as alienable agricultural lands of the
public domain provided the requirements of public land laws
are met. (Chavez vs. Public Estates Authority, G.R. No. 133250,
November 11, 2003, 415 SCRA 403)
Reclaimed land
Foreshore and submerged areas belong to the public domain
and are inalienable unless reclaimed, classified as alienable
lands open to disposition and further declared no longer
needed for public service. The fact that alienable lands of the
public domain were transferred to the Public Estates
Authority (PEA) (now Philippine Reclamation Authority [PRA])
and issued land patents or certificates of title in PEA’s name
did not automatically make such lands private.
Reclaimed lands retain their inherent potential as areas for
public use or public service. Such reclaimed lands are part of
the public domain, owned by the State and, therefore, exempt
from payment of real estate taxes. (Republic vs. City of
Parañaque, G.R. No. 191109, July 18, 2012, 677 SCRA 246)
Canals
Pursuant to Article 71 of the Spanish Law of Waters of
August 3, 1866 and Article 408(5) of the Spanish Civil Code,
channels of creeks and brooks belong to the owners of
estates over which they flow. Under Article 339 [of the Old
Civil Code], canals constructed by the State and devoted to
public use are of public ownership. Conversely, canals
constructed by private persons within private lands and
devoted exclusively for private use must be of public
ownership. (Santos vs. Moreno, No. L-15829, December 4,
1967, 21 SCRA 1141)
River bed, river bank
A river is composed of the running waters, the bed, and the
banks.
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All beds of rivers are of public ownership, the banks, which
form part thereof, are also of public ownership, including
those banks which are formed when a river leaves its old bed
and opens a new course through a private estate.
The natural bed or channel of a creek or river is the ground
covered by its waters during the ordinary floods.
A river bank is part of the bed of the river. “Banks of a river”
refer to those lateral strips or zones of its bed which are
washed by the stream only during such high floods as do not
cause inundations or to the point reached by the river at high
tide. The nature of the banks always follows that of the bed
and the running waters of the river.
Since rivers are of public ownership, it is implicit that all their
three component elements are also of public ownership.
(Hilario vs. City of Manila, No. L-19570, April 27, 1967, 19 SCRA
931)
Outside the commerce of man
A public street is property for public use hence outside the
commerce of man (Arts. 420, 424, Civil Code). Being outside
the commerce of man, it may not be the subject of lease or
other contract. (Dacanay vs. Asistio, Jr., G.R. No. 93654, May 6,
1992, 208 SCRA 404)
Prescription
All lands thrown up by the sea and formed upon the shore by
the action of the water, together with the adjacent shore,
belong to the national domain and are for public uses, in
accordance with the provisions of the Law of Waters of
August 3, 1866.
According to the provision of article 1936 of the Civil Code so
long as the shore and land formed by the action of the sea
continue to be set apart for public uses, they are not
susceptible of prescription as they are outside the sphere of
commerce. (Insular Government vs. Aldecoa & Co., No. 6098,
August 12, 1911, 19 Phil. 505)
Foreclosure
The Airport Lands and Buildings of the MIAA are property of
public dominion and therefore owned by the State or the
Republic of the Philippines.
 patrimonial property which can be the object of an ordinary


MIAA’s Airport Lands and Buildings are exempt from real
estate tax imposed by local governments. First, MIAA is not a
government-owned or controlled corporation but an
instrumentality of the National Government and thus exempt
from local taxation. Second, the real properties of MIAA are
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Atty. Donna Z. Gasgonia
owned by the Republic of the Philippines and thus exempt
from real estate tax.



Property of public dominion, being outside the commerce of
man, cannot be the subject of an auction sale. Any
encumbrance, levy on execution or auction sale of any
property of public dominion is void for being contrary to
public policy. Essential public services will stop if properties
of public dominion are subject to encumbrances, foreclosures
and auction sale. (Manila International Airport Authority vs.
Court of Appeals, G.R. No. 155650, July 20, 2006, 495 SCRA
591)
Patrimonial property
Art. 421. All other property of the State, which is not of the
character stated in the preceding article, is patrimonial
property.
Patrimonial property of the State is the property it owns but
which is NOT devoted to:
1.      Public use
2.      Public service
3.      Development of national wealth
No longer for public use or for public service
Art. 422. Property of public dominion, when no longer
intended for public use or for public service, shall form part of
the patrimonial property of the State.
Contract
Article 422 of the Civil Code expressly provides that “Property
of public dominion, when no longer intended for public use or
for public service, shall form part of the patrimonial property
of the State.” Besides, the Revised Charter of the City of Cebu
heretofore quoted, in very clear and unequivocal terms, states
that: “Property thus withdrawn from public servitude may be
used or conveyed for any purpose for which other real
property belonging to the City may be lawfully used or
conveyed.”
Since that portion of the city street subject of petitioner’s
application for registration of title was withdrawn from public
use, it follows that such withdrawn portion becomes
contract. (Cebu Oxygen & Acetylene Co., Inc. vs. Bercilles, No.
L-40474, August 29, 1975, 66 SCRA 481)
Embassy property
As property of public dominion, the Roppongi lot is outside
the commerce of man. It cannot be alienated. Its ownership is
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Property Law Midterms Reviewer
a special collective ownership for general use and enjoyment,
an application to the satisfaction of collective needs, and
resides in the social group. The purpose is not to serve the
State as a juridical person, but the citizens; it is intended for
the common and public welfare and cannot be the object of
appropriation.
The Roppongi property is correctly classified under paragraph
2 of Article 420 of the Civil Code as property belonging to the
State and intended for some public service.
The fact that the Roppongi site has not been used for a long
time for actual Embassy service does not automatically
convert it to patrimonial property. Any such conversion
happens only if the property is withdrawn from public use
(Cebu Oxygen and Acetylene Co. v. Bercilles, 66 SCRA 481
[1975]). A property continues to be part of the public domain,
not available for private appropriation or ownership “until
there is a formal declaration on the part of the government to
withdraw it from being such.
An abandonment of the intention to use the Roppongi
property for public service and to make it patrimonial
property under Article 422 of the Civil Code must be definite.
(Laurel vs. Garcia, G.R. No. 92013, July 25, 1990, 187 SCRA
797)
Property of local government units (LGUs)
Art. 423. The property of provinces, cities, and municipalities
is divided into property for public use and patrimonial
property.
LGU property for public use and LGU patrimonial property
Art. 424. Property for public use, in the provinces, cities, and
municipalities, consist of the provincial roads, city streets,
municipal streets, the squares, fountains, public waters,
promenades, and public works for public service paid for by
said provinces, cities, or municipalities.
 
All other property possessed by any of them is patrimonial
and shall be governed by this Code, without prejudice to the
provisions of special laws.
Special law
Articles 423 and 424 of the Civil Code classify property of
provinces, cities, and municipalities into property for public
use and patrimonial property. Property for public use consists
of provincial roads, city streets, municipal streets, the
squares, fountains, public waters, promenades, and public
works for public service paid for by said provinces, cities, or
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
municipalities. All other property possessed by any of them is
patrimonial and shall be governed by this Code, without
prejudice to the provisions of special laws.
Under the principles constituting the law of Municipal
Corporations, all those of the 50 properties in question which
are devoted to public service are deemed public; the rest
remain patrimonial. Under this norm, to be considered public
it is enough that the property be held and devoted for
governmental purposes like local administration, public
education, public health, etc.
Buildings built on lots which are public in nature follow the
classification of the lots on which they are built. Moreover,
said buildings, then located in the city, will not be for the
exclusive use and benefit of city residents for they could be
availed of also by the provincial residents. The province then
—and its successors-in-interest—are not really deprived of the
benefits thereof.
Republic Act 3039 cannot be applied to deprive Zamboanga
del Norte of its share in the value of the rest of the 26 lots
which are patrimonial properties since they are not being
utilized for distinctly governmental purposes. Moreover, the
fact that they are registered strengthens the proposition that
they are truly private in nature.
Private ownership
Art. 425. Property of private ownership, besides the
patrimonial property of the State, provinces, cities, and
municipalities, consists of all property belonging to private
persons, either individually or collectively.
Common provisions
Art. 426. Whenever by provision of the law, or an individual
declaration, the expression "immovable things or property," or
"movable things or property," is used, it shall be deemed to
include, respectively, the things enumerated in Chapter 1 and
Chapter 2.


Whenever the word "muebles," or "furniture," is used alone, it
shall not be deemed to include money, credits, commercial
securities, stocks and bonds, jewelry, scientific or artistic
collections, books, medals, arms, clothing, horses or
carriages and their accessories, grains, liquids and
merchandise, or other things which do not have as their
principal object the furnishing or ornamenting of a building,
except where from the context of the law, or the individual
declaration, the contrary clearly appears.
 
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OWNERSHIP (Arts. 427-439)
Ownership in general
Art. 427. Ownership may be exercised over things or rights.
(n)
Rights of ownership
Art. 428. The owner has the right to enjoy and dispose of a
thing, without other limitations than those established by law.
The owner has also a right of action against the holder and
possessor of the thing in order to recover it. (348a)
Rights of an owner
1. Right to enjoy (possess, use, fruits)
2. Right to dispose (consume, destroy, or abuse; encumber
or alienate)
3. Right to recover
Rights of an owner under Roman Law (PUF-ADV)
1. Jus possidendi - right to possess
2. Jus utendi - right to use
3. Jus fruendi - right to the fruits
4. Jus abutendi - right to consume (and also to transform or
abuse)
5. Jus disponendi - right to encumber or alienate
6. Jus vindicandi - right to recover
Realty tax assessed in the name of owner/administrator
Real property tax is assessed in the name of the person
“owning or administering” the property on which the tax is
levied. (Philippine Suburban Development Corporation vs.
Auditor General, No. L-19545, April 18, 1975)
What is the difference between full ownership and naked
ownership?
Full ownership (dominium or jus in re propia) includes all the
rights of an owner.
Naked ownership (nuda proprietas) is where the right to the
use and the fruits has been denied. (Full ownership minus
usufruct).
What is sole ownership?
It is where the ownership is vested in only one person.
What is co-ownership?
It is when the ownership is vested in two or more owners.
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
Informacion possessoria
Possessory information title issued under the Spanish
Mortgage Law and the Royal Decree of 1894, which was the
basis of a gratuitous title of ownership upon the fulfillment of
certain conditions such as possession or cultivation of the
land and the institution of possessory information within one
year from 17 April 1894. (Balbin vs. Medalla, October 30, 1981,
108 SCRA 674)
A Spanish title wherein the public prosecutor saw to it that
legal processes or requisites, such as the nature, location,
area, boundaries, possession and encumbrances which were
proved were duly complied with. (Director of Lands vs. Abay,
37705-R, March 12, 1980)
An informacion possessoria (possessory information) duly
recorded in the Registry of Property is prima facie evidence
that the registered possessor is also the owner of the land
involved. (Querubin vs. Alconcel, L-23050, Sep. 18, 1975)
A Torrens title is incontrovertible against any informacion
possessoria, of other title existing prior to the issuance
thereof not annotated on the Torrens title. (Republic vs.
Orfinada, Sr., G.R. No. 141145, November 12, 2004)
Right of actual possessor
Adjudication of ownership necessarily includes delivery of
possession. Indeed, it would be defeating the ends of justice
should we require that for the parties to obtain possession of
the property duly adjudged to be theirs from those who have
no right to remain therein, they must submit to court
litigations anew. An exception however exists where the
actual possessor has shown a valid right over the property
enforceable even against the owner thereof. (Nazareno vs.
Court of Appeals, G.R. No. 131641, February 23, 2000)
Replevin
Replevin is defined as an action or provisional remedy where
the complainant prays for the recovery of the posession of
personal property. (Sec. 1, Rule 60, Rules of Court).
A writ of replevin does not just issue as a matter of course
upon the applicant’s filing of a bond and affidavit x x x. The
mere filing of an affidavit, sans allegations therein that satisfy
the requirements of Sec. 2, Rule 60 of the Revised Rules of
Court, cannot justify the issuance of a writ of replevin.
Wrongful detention by the defendant of the properties sought
in an action for replevin must be satisfactorily established. If
only a mechanistic averment thereof is offered, the writ
should not be issued. x x x As the petitioner Secretary’s
administrative authority to confiscate is clearly provided by
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Property Law Midterms Reviewer
law, the taking of the subject properties is not wrongful and
does not warrant the issuance of a writ of replevin prayed for
by private respondents.
Issuance of the confiscation order by petitioner Secretary
was a valid exercise of his power under Sec. 68-A of P.D. No.
705. By virtue of said order, the narra lumber and six-wheeler
truck of private respondents were held in custodia legis and
hence, beyond the reach of replevin. Property lawfully taken
by virtue of legal process is deemed to be in custodia legis.
When a thing is in official custody of a judicial or executive
officer in pursuance of his execution of a legal writ, replevin
will not lie to recover it. Otherwise, there would be
interference with the possession before the function of law
had been performed as to the process under which the
property was taken. (Factoran, Jr. vs. Court of Appeals, G.R.
No. 93540, December 13, 1999)
Wrongful entry
Forcible entry and unlawful detainer are two distinct causes
of action defined in Section 1, Rule 70 of the Rules of Court.
In forcible entry, one is deprived of physical possession of
any land or building by means of force, intimidation, threat,
strategy, or stealth. In unlawful detainer, one unlawfully
withholds possession thereof after the expiration or
termination of his right to hold possession under any
contract, express or implied. In forcible entry, the possession
is illegal from the beginning and the only issue is who has the
prior possession de facto. In unlawful detainer, possession
was originally lawful but became unlawful by the expiration or
termination of the right to possess and the issue of rightful
possession is the one decisive, for in such action, the
defendant is the party in actual possession and the plaintiff's
cause of action is the termination of the defendant's right to
continue in possession.
The words ‘by force, intimidation, threat, strategy or stealth’
shall include every situation or condition under which one
person can wrongfully enter upon real property and exclude
another, who has had prior possession, therefrom. The
foundation of the action is really the forcible exclusion of the
original possessor by a person who has entered without right.
The act of going on the property and excluding the lawful
possessor therefrom necessarily implies the exertion of force
over the property, and this is all that is necessary. The
employment of force, in this case, can be deduced from
petitioners’ allegation that respondent took full control and
possession of the subject property without their consent and
authority.
‘Stealth,’ on the other hand, is defined as any secret, sly, or
clandestine act to avoid discovery and to gain entrance into
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
or remain within residence of another without permission,”
while strategy connotes the employment of machinations or
artifices to gain possession of the subject property. The CA
found that based on the petitioners’ allegations in their
complaint, “respondent’s entry on the land of the petitioners
was by stealth x x x.” However, stealth as defined requires a
clandestine character which is not availing in the instant case
as the entry of the respondent into the property appears to be
with the knowledge of the petitioners as shown by petitioners’
allegation in their complaint that “[c]onsidering the
personalities behind the defendant foundation and
considering further that it is plaintiff’s nephew, then the vice-
mayor, and now the Mayor of the City of Roxas Antonio A. del
Rosario, although without any legal or contractual right, who
transacted with the foundation, plaintiffs did not interfere
with the activities of the foundation using their property.” To
this Court’s mind, this allegation if true, also illustrates
strategy.
Where the defendant’s possession of the property is illegal ab
initio, the summary action for forcible entry (detentacion) is
the remedy to recover possession. (Del Rosario vs. Gerry
Roxas Foundation, Inc., G.R. No. 170575, June 8, 2011)
Physical possession
Ejectment proceedings are summary proceedings only
intended to provide an expeditious means of protecting
actual possession or right to possession of property. The sole
issue to be resolved is who is entitled to the physical or
material possession of the premises or possession de facto.
The Court sustains the Decision of the Court of Appeals that
respondents are entitled to the possession of the subject
property as they are found to be the ones in actual
possession of the property after it was sold to them by the
registered owners, Emilio and Pilar Torres. (Fernandez, Sr. vs.
Co, G.R. No. 167390, July 26, 2010)
Action in personam
A petition for the cancellation of notice of embargo is not
cadastral in nature but is an action to quiet title and/or
remove cloud therefrom, under Articles 476, 478 and 481 of
the Civil Code—it is an action in personam, one not directed
against the whole world.
A real action is not the same as an action in rem and a
personal action is not the same as an action in personam. In a
personal action, the plaintiff seeks the recovery of personal
property, the enforcement of a contract or the recovery of the
damages. In a real action, the plaintiff seeks the recovery of
real property, or, as indicated in section 2 (a) of Rule 4, a real
action is an action affecting title to real property or for the
recovery of possession, or for partition or condemnation of,
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Property Law Midterms Reviewer
or foreclosure of a mortgage on, real property. An action in
personam is an action against a person on the basis of his
personal liability, while an action in rem is an action against
the thing itself, instead of against the person (1 C.J.S. 943-4).
Hence, a real action may at the same time be an action in
personam and not necessarily an action in rem.
A petition for cancellation of notice of embargo is a real
action as it seeks the recovery of real property, but it is also
an action in personam because it is directed only against the
plaintiffs in Civil Case No. 32482—thus, there is a need for
personal service upon the said plaintiffs who would be
adversely affected by the cancellation of the notice of
embargo on the TCTs. (Rico vs. Rufon, A.M. No. RTJ-04-1822,
June 25, 2007)
Trespassing
An injunction is a perfectly legitimate remedy to protect the
owner of the land, being in possession, from illegitimate acts
of repeated intrusion by a stranger. The intermittent nature of
such acts and the probability, not to say certainty, of
repetition in the future, justifies the granting of the equitable
remedy (Pomeroy, Equity Jurisprudence, 3rd Ed., Vol. 4, Sec.
1357).
Injunction in forcible entry cases is provided for in Article
539, New Civil Code and section 3, Rule 70, Revised Rules of
Court. (Barrameda vs. Gontang, et al., No. L-24110, February
18, 1967)
Principle of self-help
Art. 429. The owner or lawful possessor of a thing has the
right to exclude any person from the enjoyment and disposal
thereof. For this purpose, he may use such force as may be
reasonably necessary to repel or prevent an actual or
threatened unlawful physical invasion or usurpation of his
property. (n)
Self-help principle - use reasonable force against ACTUAL or
THREATENED unlawful physical invasion or usurpation of
property
Doctrine of self-help can only be exercised at the time of
actual or threatened dispossession. When possession has
already been lost, the owner must resort to judicial process
for the recovery of property. This is clear from Article 536 of
the Civil Code which states, “(I)n no case may possession be
acquired through force or intimidation as long as there is a
possessor who objects thereto. He who believes that he has
an action or right to deprive another of the holding of a thing,
must invoke the aid of the competent court, if the holder
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Atty. Donna Z. Gasgonia
should refuse to deliver the thing.” (German Management &
Services, Inc. vs. Court of Appeals, G.R. No. 76216, September
14, 1989)
Right to enclose or fence
Art. 430. Every owner may enclose or fence his land or
tenements by means of walls, ditches, live or dead hedges, or
by any other means without detriment to servitudes
constituted thereon. (388)
‣ Can you construct a fence to impound water in your land,
which naturally flows into your neighbor’s property, so that
you can build a fish pond?



NO! In Lunod vs. Meneses (No. 4223, August 19, 1908), the
Supreme Court held:



“Where a statutory easement exists between adjoining
estates, the owner of the lower lands must not construct
any work that may impair or obstruct an easement which
consists in receiving the waters which naturally, and
without the intervention of man, descend from the more
elevated lands; neither shall the owner of the latter
construct any work that may increase the easement.



Every owner may enclose his property by means of walls,
dikes, fences, or any other device, but his right is limited by
the easement with which his estate is charged.”
Rights of third persons
Art. 431. The owner of a thing cannot make use thereof in
such manner as to injure the rights of a third person. (n)
State of necessity
Art. 432. The owner of a thing has no right to prohibit the
interference of another with the same, if the interference is
necessary to avert an imminent danger and the threatened
damage, compared to the damage arising to the owner from
the interference, is much greater. The owner may demand
from the person benefited indemnity for the damage to him.
(n)
‣ “State of necessity” - Avert IMMINENT danger and
THREATENED damage greater than the damage to the
owner
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Property Law Midterms Reviewer
Negotiorum gestor, negotiorum gestio
Art. 2144. Whoever voluntarily takes charge of the agency or
management of the business or property of another, without
any power from the latter, is obliged to continue the same
until the termination of the affair and its incidents, or to
require the person concerned to substitute him, if the owner
is in a position to do so.
This juridical relation does not arise in either of these
instances:
(1) When the property or business is not neglected or
abandoned;
(2) If in fact the manager has been tacitly authorized by the
owner.
In the first case, the provisions of Articles 1317, 1403, No. 1,
and 1404 regarding unauthorized contracts shall govern.
In the second case, the rules on agency in Title X of this Book
shall be applicable. (1888a)
Action to repel the damage should be reasonable
The accused shot not only once but four times this female
white pig with his shotgun, Caliber .22 when he saw it among
the plants. There was certainly the element of vengeance and
anger with malicious intent of avenging whatever damage the
pig might have done to his plants. The proper thing which the
accused should have done when he saw the pig among his
plants, was to drive it away, and after assessing the value of
whatever damages the pig might have caused to his plants,
he should have filed a civil action for damages against the
owner, in accordance with the provisions of the Civil Code.
But in this case he took the law in his own hands x x x.
(People v. Segovia, L-11748, May 28, 1958)
Judicial process
Art. 433. Actual possession under claim of ownership raises
disputable presumption of ownership. The true owner must
resort to judicial process for the recovery of the property. (n)
Action to recover
Art. 434. In an action to recover, the property must be
identified, and the plaintiff must rely on the strength of his
title and not on the weakness of the defendant's claim. (n)
Actual possession is a disputable presumption of ownership.
True owner of the property must go to court to recover the
property (judicial process).
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
The owner cannot recover the thing through force or
intimidation. He must invoke the aid of the competent court,
if the holder should refuse to deliver the thing. (Art. 536)
Actions to recover real property:
1. Accion interdictal (forcible entry and unlawful detainer)
2. Accion publiciana
3. Accion reivindicatoria
Action to recover personal property:
Replevin
Accion interdictal
An accion interdictal seeks the recovery of physical
possession of real property and is brought within one year in
the justice of the peace court (now MTC) (Reyes vs. Sta.
Maria, No. L-33213, June 29, 1979)
An accion interdictal is a summary action involving physical
possession or possession de facto. The issue of ownership
may be resolved only if necessary to determine the issue of
possession. (Custodio vs. Corrado, G.R. No. 146082, July 30,
2004; Ganila vs. Court of Appeals, G.R. No. 150755, July 28,
2005).
Accion interdictal includes both action for forcible entry and
unlawful detainer.
An accion interdictal is within the jurisdiction of the Municipal
or Metropolitan Trial Courts.
It is available only within the first year of dispossession. (Sec.
1, Rule 70, Rules of Court)
Forcible entry
Forcible entry x x x is the act of a person of depriving another
of his possession of a land or building by any one of the
following means, to wit: force, intimidation, threat, strategy or
stealth, where the illegal possession of the trespasser does
not exceed one year. The latter's possession is illegal from the
very beginning, and for that reason it is not necessary that
plaintiff should make a demand to quit or for possession
before filing an action within one year from the
dispossession. (Co Tiamco vs. Diaz, No. L-7, January 22, 1946)
In forcible entry cases, the action must be brought within one
year from the date of actual entry on the land. (Leynes vs CA,
G.R. No. 154462, January 19, 2011)
But where the forcible entry was made clandestinely, the one-
year period is counted from the time the person deprived of
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Property Law
possession demanded that the intruder desist after learning
of the intrusion. (Elane vs. Court of Appeals, G.R. No. 80638,
April 26, 1989; Domalsin vs. Valenciano, G.R. 158687, January
25, 2006)
Forcible entry applies when a person is deprived of
possession of any land or building by force, intimidation,
threat, strategy or stealth. (Sec. 1, Rule 70, Rules of Court)
Unlawful detainer
Unlawful detainer, on the other hand, is defined x x x as the
act of withholding the possession of a land or building from
another entitled to it, after the expiration or termination of the
right of the illegal detainer to hold possession by virtue of a
contract, express or implied, where one year had not yet
elapsed from the time the originally legal possession had
become illegal, and for that reason, it is necessary to
determine when the originally legal possession of the
detainer became illegal. (Co Tiamco vs. Diaz, No. L-7, January
22, 1946)
Unlawful detainer applies to a lessor, vendor, vendee, or other
person against whom the possession of any land or building
is unlawfully withheld after the right to possession has been
terminated. (Sec. 1, Rule 70, Rules of Court)
Accion publiciana (possession, > 1 yr)
An accion publiciana is for the recovery of the right to possess
and is a plenary action in an ordinary civil proceeding in a
Court of First Instance (now RTC) (Reyes vs. Sta. Maria, No.
L-33213, June 29, 1979)
Accion reivindicatoria (ownership, > 1 yr)
An accion reivindicatoria is an action to recover ownership. It
involves the issue of ownership. Since ownership normally
includes the right of possession, recovery of ownership would
normally include recovery of possession as well.
It is within the jurisdiction of the Regional Trial Courts.
(Also see Alo vs. Rocamora, 6 Phil 197)
Replevin
Replevin is defined as an action or provisional remedy where
the complainant prays for the recovery of the posession of
personal property. (Sec. 1, Rule 60, Rules of Court).
Machinery and equipment used for an industry and
indispensable for the carrying on of such industry, cannot be
the subject of replevin, because under the premises, they are
real, and not personal property. (Machinery and Engineering
Supplies, Inc. vs. Court of Appeals, 96 Phil. 70).
DRH Palis DLSU Law | 1st Sem, 2017-2018
Midterms Reviewer Atty. Donna Z. Gasgonia
Where the marked bottles are transferred by way of sale, the
registered owner relinquishes all its proprietary rights over
the bottles in favor of the person who obtains them in due
course. (Distilleria Washington vs. La Tondeña Distillers, G.R.
No. 120961, October 2, 1997)
When a thing is in official custody of a judicial or executive
officer in pursuance of his execution of a legal writ, replevin
will not lie to recover it.(Factoran vs. CA, G.R. No. 93540,
December 13, 1999)
Action to recover
Article 434 of the Civil Code ordains that “in an action to
recover, the property must be identified, and the plaintiff must
rely on the strength of his title and not on the weakness of
the defendant’s claim.” Hence, in order that an action for the
recovery of property may prosper, it is indispensable that the
party who prosecutes it must fully prove, not only his
ownership of the thing claimed, but also the identity of the
same. (Pang-oden vs. Leonen, G.R. No. 138939, December 6,
2006)
Claim of ownership; Regalian Doctrine
To prove that the land subject of an application for
registration is alienable, an applicant must establish the
existence of a positive act of the government such as a
presidential proclamation or an executive order, an
administrative action, investigation reports of Bureau of
Lands investigators, and a legislative act or a statute, and the
applicant may also secure a certification from the
Government that the lands applied for are alienable and
disposable.
While, as a rule, tax declarations or realty tax payments of
property are not conclusive evidence of ownership,
nevertheless they are good indicia of possession in the
concept of owner, for no one in his right mind would be
paying taxes for a property that is not in his actual or
constructive possession—they constitute at least proof that
the holder has a claim of title over the property.
Mere casual cultivation of the land does not amount to
exclusive and notorious possession that would give rise to
ownership—specific acts of dominion must be clearly shown
by the applicant. (Aranda vs. Republic, G.R. No. 172331,
August 24, 2011)
Titles, tax declaration
Tax declarations or realty tax payments of property are not
conclusive evidence of ownership.
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Property Law Midterms Reviewer
Certificate of title in the name of private respondents
indicates true and legal ownership over the property. (Ferrer-
Lopez vs. Court of Appeals, No. L-50420. May 29, 1987)
A squatter is not an informal settler
A squatter’s possession of the property is by tolerance.
Where possession by possessor not by mere tolerance but
with occupancy that could ripen into title under a legislative
act, prior possession in the plaintiff constitutes an
indispensable requirement.
Possession of a possessor by tolerance becomes unlawful
the moment the owner demands that he vacate the land.
(Bormaheco, Inc. vs. Abanes, No. L-28087, July 13, 1973)
When ejectment available
A person who occupies the land of another at the latter's
tolerance or permission, without any contract between them
is necessarily bound by an implied promise that he will vacate
upon demand, failing which a summary action for ejectment
is the proper remedy against him.(Yu vs. De Lara, No. L-16084,
November 30, 1962,6 SCRA 785)
Judgment in forcible entry cases does not necessarily
constitute res judicata
A judgment in a forcible entry case involves only the right of
possession and does not constitute res judicata as to a
subsequent action to quiet title and settle the issue of
ownership over the land involved in the litigation.
In an action to recover property, the following are
indispensable:
1. Identity of the property - boundaries known
2. Strength of plaintiff’s title - not on defendant’s weakness
Eminent domain; Just compensation
Art. 435. No person shall be deprived of his property except
by competent authority and for public use and always upon
payment of just compensation.
Should this requirement be not first complied with, the courts
shall protect and, in a proper case, restore the owner in his
possession. (349a)
‣ Eminent Domain - taking of property for public use with
just compensation (the authority)
‣ Expropriation - a judicial proceeding to determine the
value of the property to be taken by the State
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Atty. Donna Z. Gasgonia
No right to recover when estopped
Ynchausti vs. Manila Electric Railroad & Light Co., 36 Phil 908
- Ynchausti did not object or oppose until the work was
completed
- Estoppel, No right to recover possession
- Only remedy is compensation for the lands taken and
resulting damages to the lands not taken
- Exception to Art. 435
Just compensation; No expropriation when negotiations are
entered into by State and owner
Question as to the amount of compensation could be
resolved only tentatively by administrative authorities but
ultimately by the courts of justice.
In this case, the properties taken by the government by virtue
of negotiated sales voluntarily entered into between the
Ministry of Public Highways and the private respondents. No
compulsion was exerted. Eminent domain was not invoked.
Clearly then, the laws on the ascertainment of the just
compensation to be paid the expropriated property were not
applicable.
Just compensation to be awarded to the owners is not their
own declared valuation of their respective properties or the
assessment thereof by the government, whichever is lower,
conformably to PD 76.
What is applicable here is not the law on eminent domain but
the law on contracts as embodied in the Civil Code. Under its
Article 1306, the contracting parties may enter into any terms
and conditions they may deem convenient provided they are
not contrary to law, morals, good customs, public order or
public policy. (Rocamora vs. RTC-Cebu, No. L-65037, November
23, 1988)
Expropriation does not involve recovery of a sum of money
An expropriation suit does not involve the recovery of a sum
of money. Rather, it deals with the exercise by the
government of its authority and right to take property for
public use. As such, it is incapable of pecuniary estimation
and should be filed with the regional trial courts. (Bardillon vs.
Barangay Masili of Calamba, Laguna, G.R. No. 146886. April 30,
2003)
What are the requisites for authorizing immediate entry in
expropriation proceedings?
The requirements for the issuance of a writ of possession in
an expropriation case are expressly and specifically governed
by Section 2 of Rule 67 of the 1997 Rules of Civil Procedure.
On the part of local government units, expropriation is also
governed by Section 19 of the Local Government Code.
14
Property Law Midterms Reviewer Atty. Donna Z. Gasgonia

Accordingly, in expropriation proceedings, the requisites for ‣ Right to space and subsoil SUBJECT to servitudes and
authorizing immediate entry are as follows: (1) the filing of a aerial navigation
complaint for expropriation sufficient in form and substance;
and (2) the deposit of the amount equivalent to 15 percent of Hidden Treasure
the fair market value of the property to be expropriated based
Art. 438. Hidden treasure belongs to the owner of the land,
on its current tax declaration. (Bardillon vs. Barangay Masili of
building, or other property on which it is found.
Calamba, Laguna, G.R. No. 146886. April 30, 2003)

Nevertheless, when the discovery is made on the property of

Police Power
another, or of the State or any of its subdivisions, and by
Art. 436. When any property is condemned or seized by chance, one-half thereof shall be allowed to the finder. If the
competent authority in the interest of health, safety or finder is a trespasser, he shall not be entitled to any share of
security, the owner thereof shall not be entitled to the treasure.
compensation, unless he can show that such condemnation
or seizure is unjustified. (n) If the things found be of interest to science of the arts, the
State may acquire them at their just price, which shall be
divided in conformity with the rule stated. (351a)
‣ Police Power - taking of property for public health, safety
or security without just compensation
Hidden treasure
Salus populi suprema est lex Finder/owner of land, building or property = 100%
"The welfare of the people is the highest law” Finder/not owner = 50%
Trespasser = 0%
CMU vs Executive Secretary (2010)
In Central Mindanao University vs. Executive Secretary (G.R. Meaning of Hidden Treasure
No. 184869, September 21, 2010) the Supreme Court held:
Art. 439. By treasure is understood, for legal purposes, any
hidden and unknown deposit of money, jewelry, or other
“The lands by their character have become inalienable from
precious objects, the lawful ownership of which does not
the moment President Garcia dedicated them for Central
appear. (352)
Mindanao University’s use in scientific and technological
research in the field of agriculture—they ceased to be
alienable public lands. Hidden treasure = hidden and unknown + money/jewelry/
precious object + lawful ownership does not appear
When Congress enacted the Indigenous Peoples’ Rights Act
(IPRA) or Republic Act 8371 in 1997, it provided in Section 56
that “property rights within the ancestral domains already
existing and/or vested” upon its effectivity “shall be
recognized and respected.” In this case, ownership over the
subject lands had been vested in CMU as early as 1958.
Consequently, transferring the lands in 2003 to the
indigenous peoples around the area is not in accord with the
IPRA.”

Surface Rights

Art. 437. The owner of a parcel of land is the owner of its

surface and of everything under it, and he can construct
thereon any works or make any plantations and excavations
which he may deem proper, without detriment to servitudes
and subject to special laws and ordinances. He cannot
complain of the reasonable requirements of aerial navigation.
(350a)

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Property Law Midterms Reviewer Atty. Donna Z. Gasgonia

ACCESSION (Arts. 440-475) 3. Change of river bed

4. Formation of islands
Right of accession 5. Build-Plant-Sow (B-P-S)

Art. 440. The ownership of property gives the right by

‣ Interest on compensation for property deposited in a bank
accession to everything which is produced thereby, or which
during expropriation proceedings in court. Who is the
is incorporated or attached thereto, either naturally or
owner of interests earned in a deposited amount
artificially. (353)
equivalent to just compensation intended to pay
expropriated property?

Accession is the right by virtue of which the owner of a thing 

becomes the owner of everything that it may produce or The private owner. Interest on the deposits are civil fruits.
which may be inseparably united or incorporated thereto, (Art. 441) (Republic vs. Phil. Long Distance Telephone Co.,
either naturally or artificially. (Tolentino, p. 97) No. L-18841. January 27, 1969)

Accession is the extension of ownership over a thing to Kinds of Fruits

everything which is produced by it or incorporated or
Art. 442. Natural fruits are the spontaneous products of the
attached to it. (“The accessory follows the principal.”)
soil, and the young and other products of animals.

Basic principles of accession (Tolentino, p. 99)

Industrial fruits are those produced by lands of any kind
1. The extension or increase of a thing belongs to its owner.
through cultivation or labor.
2. This extension of the right of ownership is realized, as a
general rule, under the juridical principle that the
Civil fruits are the rents of buildings, the price of leases of
accessory follows the principal—accessio cedit principali
lands and other property and the amount of perpetual or life
—the owner of the latter acquires or extends his
annuities or other similar income. (355a)
ownership over the former.
3. The incorporation of the accessory to the principal is
effected only when two things are so united that they Rent
cannot be separated without injuring or destroying the Rent is a civil fruit that belongs to the owner of the property
juridical nature of one of them, except otherwise provided producing it by right of accession. (Philippine National Bank
by law. vs. Marañon, G.R. No. 189316, July 1, 2013, 700 SCRA 297)

Right of accession with respect to what is produced by Reimbursement

property
Art. 443. He who receives the fruits has the obligation to pay
the expenses made by a third person in their production,
Fruits
gathering, and preservation. (356)
Art. 441. To the owner belongs: 


Natural and industrial fruits

(1) The natural fruits;

(2) The industrial fruits;
 Art. 444. Only such as are manifest or born are considered as
(3) The civil fruits. (354) natural or industrial fruits.

With respect to animals, it is sufficient that they are in the

Accession discreta - Extension of the right of ownership to the
womb of the mother, although unborn. (357)
products of the thing. (Art. 441)
1. Natural fruits
2. Industrial fruits Right of accession with respect to immovable property
3. Civil fruits
Art. 445. Whatever is built, planted or sown on the land of
another and the improvements or repairs made thereon,
Accession continua - Acquisition of ownership over a thing
belong to the owner of the land, subject to the provisions of
incorporated to the which belongs to the owner
the following articles. (358)
1. Alluvion
2. Force of river

DRH Palis DLSU Law | 1st Sem, 2017-2018 16

Property Law Midterms Reviewer
Latin Maxims
‣ Accessorium non duct sed sequitor suum principali 

The accessory does not lead but follows its principal 

‣ Accessorium sequitor natural rei cui accedit

The accessory follows the nature of that to which it
relates

‣ Aedificatum solo, solo cedit 

What is built upon the land goes with it; or the land is the
principal, and whatever is built on it becomes the
accessory
Same person
Under the articles of the Civil Code on industrial accession by
edification on the principal land (Articles 445 to 456 of the
Civil Code), such accession is limited either to buildings
erected on the land of another, or buildings constructed by
the owner of the land with materials owned by someone else.
(Gaboya vs. Cui, No. L-19614, March 27, 1971, 38 SCRA 85)
Improvements
Art. 446. All works, sowing, and planting are presumed made
by the owner and at his expense, unless the contrary is
proved. (359)
Owner of materials
Art. 447. The owner of the land who makes thereon,
personally or through another, plantings, constructions or
works with the materials of another, shall pay their value; and,
if he acted in bad faith, he shall also be obliged to the
reparation of damages. The owner of the materials shall have
the right to remove them only in case he can do so without
injury to the work constructed, or without the plantings,
constructions or works being destroyed. However, if the
landowner acted in bad faith, the owner of the materials may
remove them in any event, with a right to be indemnified for
damages. (360a)
Unpaid materials
The Supreme Court applied Art. 447 by analogy.
“Compensation should be borne by the person who has been
benefited by the accession.” The Court also found evidence of
bad faith on the part of Pacific Farms. Art. 447 applies to a
case of an unpaid furnisher of materials. (Pacific Farms, Inc. v.
Esguerra, No. L-21783, 29 November 1969, 30 SCRA 684)
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
B-P-S in good faith
Art. 448. The owner of the land on which anything has been
built, sown or planted in good faith, shall have the right to
appropriate as his own the works, sowing or planting, after
payment of the indemnity provided for in Articles 546 and
548, or to oblige the one who built or planted to pay the price
of the land, and the one who sowed, the proper rent. However,
the builder or planter cannot be obliged to buy the land if its
value is considerably more than that of the building or trees.
In such case, he shall pay reasonable rent, if the owner of the
land does not choose to appropriate the building or trees
after proper indemnity. The parties shall agree upon the terms
of the lease and in case of disagreement, the court shall fix
the terms thereof. (361a)
Options (by the landowner):
1. The builder will be required to pay rent on the land.
2. The owner will buy the land.
3. The parties can agree on a lease.
Builders and planters in good faith are entitled to the
retention of improvements pending payment under Arts. 448
and 546. (Moslem vs. Soriano, 17 Aug 1983, 124 SCRA 190)
Honest belief
A builder in good faith can compel the landowner to make a
choice between appropriating the building by paying the
proper indemnity or obliging the builder to pay the price of
the land. In order, however, that the builder can invoke the
accruing benefit and enjoy his corresponding right to demand
that a choice be made by the landowner, he should be able to
prove good faith on his part.
Good faith is an intangible and abstract 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. 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.
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 “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”. (Philippine National Bank vs. De Jesus, G.R.
No. 149295, September 23, 2003, 411 SCRA 557)
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Property Law Midterms Reviewer
Two or more parties 

By its clear language, Article 448 refers to a land whose
ownership is claimed by two or more parties, one of whom
has built some works, or sown or planted something. The
building, sowing or planting may have been made in good
faith or in bad faith. The rule on good faith laid down in
Article 526 of the Civil Code shall be applied in determining
whether a builder, sower or planter had acted in good faith.
Article 448 does not apply 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 donation.
The provision of Art. 448 on indemnity may be applied by
analogy to a case where one loses the ownership of the land
on which he earlier built an apartment.
It is the current market value of the improvements which
should be made the basis of reimbursement to the builder in
good faith.
The right to retain the improvements while the corresponding
indemnity is not paid implies the tenancy or possession in
fact of the land on which it is built, planted or sown and
retention of ownership of the improvements and, necessarily,
the income therefrom. (Pecson v CA, G.R. No. 115814, May 26,
1995, 244 SCRA 407
Removal
 It is understood that there is bad faith on the part of the
Owner of land on which improvement was built by another in
good faith is entitled to removal of improvement only after
landowner has opted to sell the land and the builder refused
to pay for the same.
Where the land’s value is considerably more than the
improvement, the landowner cannot compel the builder to
buy the land. In such event, a “forced lease” is created and
the court shall fix the terms thereof in case the parties
disagree thereon. (Depra vs. Dumlao, No. L-57348, May 16,
1985, 136 SCRA 475)
B-P-S in bad faith
Art. 449. He who builds, plants or sows in bad faith on the
land of another, loses what is built, planted or sown without
right to indemnity. (362)
As soon as there is bad faith, the landowner owns the
improvements on the land.
Rights of land owner
Art. 450. The owner of the land on which anything has been
built, planted or sown in bad faith may demand the demolition
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
of the work, or that the planting or sowing be removed, in
order to replace things in their former condition at the
expense of the person who built, planted or sowed; or he may
compel the builder or planter to pay the price of the land, and
the sower the proper rent. (363a)
Damages
Art. 451. In the cases of the two preceding articles, the
landowner is entitled to damages from the builder, planter or
sower. (n)
Reimbursement for necessary expenses
Art. 452. The builder, planter or sower in bad faith is entitled
to reimbursement for the necessary expenses of preservation
of the land. (n)
Owner and B-P-S in bad faith
Art. 453. If there was bad faith, not only on the part of the
person who built, planted or sowed on the land of another, but
also on the part of the owner of such land, the rights of one
and the other shall be the same as though both had acted in
good faith.
landowner whenever the act was done with his knowledge
and without opposition on his part. (354a)
‣ How do you know if the landowner is in bad faith? 

Second paragraph of Art. 453!
Owner in bad faith, B-P-S in good faith
Art. 454. When the landowner acted in bad faith and the
builder, planter or sower proceeded in good faith, the
provisions of article 447 shall apply. (n)
Owner, B-P-S, supplier
Art. 455. If the materials, plants or seeds belong to a third
person who has not acted in bad faith, the owner of the land
shall answer subsidiarily for their value and only in the event
that the one who made use of them has no property with
which to pay.
This provision shall not apply if the owner makes use of the
right granted by article 450. If the owner of the materials,
plants or seeds has been paid by the builder, planter or sower,
18
Property Law
the latter may demand from the landowner the value of the
materials and labor. (365a)
‣ Whoever is in bad faith will lose his property.
Negligence
Art. 456. In the cases regulated in the preceding articles,
good faith does not necessarily exclude negligence, which
gives right to damages under article 2176. (n)
Art. 2176. Whoever by act or omission causes damage to
another, there being fault or negligence, is obliged to pay for
the damage done. Such fault or negligence, if there is no pre-
existing contractual relation between the parties, is called a
quasi-delict and is governed by the provisions of this Chapter.
(1902a)
Accretion
Art. 457. To the owners of lands adjoining the banks of rivers
belong the accretion which they gradually receive from the
effects of the current of the waters. (336)
‣ In case of gradual accretion, the accretion is owned by
landowner adjoining the banks of rivers.
Accretion
In the case of Meneses v. CA (246 SCRA 374 [1995]), the
Supreme Court held that accretion, as a mode of acquiring
property under Art. 457 of the Civil Code, requires the
concurrence of these requisites: (1) that the deposition of soil
or sediment be gradual and imperceptible; (2) that it be the
result of the action of the waters of the river (or sea); and (3)
that the land where accretion takes place is adjacent to the
banks of rivers (or the sea coast). These are called the rules
on alluvion which if present in a case, give to the owners of
lands adjoining the banks of rivers or streams any accretion
gradually received from the effects of the current of waters.
The requirement that the deposit should be due to the effect
of the current of the river is indispensable.
The dumping of boulders, soil and other filling materials into
the creek and river bounding the land, the same would still be
part of the public domain. (Vda. de Nazareno vs. Court of
Appeals, G.R. No. 98045, June 26, 1996, 257 SCRA 589)
DRH Palis DLSU Law | 1st Sem, 2017-2018
Midterms Reviewer Atty. Donna Z. Gasgonia
Increase in area
Alluvial deposits along the banks of a creek do not form part
of the public domain as the alluvial property automatically
belongs to the owner of the estate to which it may have been
added.
The only restriction provided for by law is that the owner of
the adjoining property must register the same under the
Torrens system; otherwise, the alluvial property may be
subject to acquisition through prescription by third persons.
(Offices of the City Mayor of Parañaque City vs. Ebio, G.R. No.
178411, June 23, 2010, 621 SCRA 555)
Reduced area
The rule that registration under the Torrens System does not
protect the riparian owner against the diminution of the area
of his registered land through gradual changes in the course
of an adjoining stream is well settled. It follows that
registration does not protect the riparian owner against
diminution of the area of his land through gradual changes in
the course of the adjoining stream.
Registration does not protect the riparian owner against the
diminution of the area of his land through gradual changes in
the course of the adjoining stream. Accretions which the
banks of rivers may gradually receive from the effect of the
current become the property of the owners of the banks.
Such accretions are natural incidents to land bordering on
running streams and the provisions of the Civil Code in that
respect are not affected by the Registration Act. (Viajar vs.
Court of Appeals, No. L-77294, December 12, 1988, 168 SCRA
405)
**See Baes v. CA, 224 SCRA 562 (exception to the general rule)
Ponds or lagoons
Art. 458. The owners of estates adjoining ponds or lagoons
do not acquire the land left dry by the natural decrease of the
waters, or lose that inundated by them in extraordinary
floods. (367)
‣ The moment the sea/ocean submerges land, that land
becomes land of the public domain. (See Chavez v PEA-
AMARI)
Avulsion
Art. 459. Whenever the current of a river, creek or torrent
segregates from an estate on its bank a known portion of
land and transfers it to another estate, the owner of the land
to which the segregated portion belonged retains the
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Property Law Midterms Reviewer
ownership of it, provided that he removes the same within
two years. (368a)
Uprooted trees
Art. 460. Trees uprooted and carried away by the current of
the waters belong to the owner of the land upon which they
may be cast, if the owners do not claim them within six
months. If such owners claim them, they shall pay the
expenses incurred in gathering them or putting them in a safe
place. (369a)
Abandoned river beds
Art. 461. River beds which are abandoned through the natural
change in the course of the waters ipso facto belong to the
owners whose lands are occupied by the new course in
proportion to the area lost. However, the owners of the lands
adjoining the old bed shall have the right to acquire the same
by paying the value thereof, which value shall not exceed the
value of the area occupied by the new bed. (370a)
Change in the course of river
If the riparian owner is entitled to compensation for the
damage to or loss of his property due to natural causes, there
is all the more reason to compensate him when the change in
the course of the river is effected through artificial means.
The loss to the petitioners of the land covered by the canal
was the result of a deliberate act on the part of the
government when it sought to improve the flow of the Tripa
de Gallina creek. It was therefore obligated to compensate
the Baeses for their loss.
 metal, when thread is woven into a textile, when a painter
**In this case, however, the Baeses have already been
compensated through a Deed of Exchange of Real Property.
New river bed
Art. 462. Whenever a river, changing its course by natural
causes, opens a new bed through a private estate, this bed
shall become of public dominion. (372a)
River divides into branches
Art. 463. Whenever the current of a river divides itself into
branches, leaving a piece of land or part thereof isolated, the
owner of the land retains his ownership. He also retains it if a
portion of land is separated from the estate by the current.
(374)
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
Islands
Art. 464. Islands which may be formed on the seas within the
jurisdiction of the Philippines, on lakes, and on navigable or
floatable rivers belong to the State. (371a)
Islands in non-navigable river
Art. 465. Islands which through successive accumulation of
alluvial deposits are formed in non-navigable and non-
floatable rivers, belong to the owners of the margins or banks
nearest to each of them, or to the owners of both margins if
the island is in the middle of the river, in which case it shall be
divided longitudinally in halves. If a single island thus formed
be more distant from one margin than from the other, the
owner of the nearer margin shall be the sole owner thereof.
(373a)
Right of accession with respect to movable property
Art. 466. Whenever two movable things belonging to different
owners are, without bad faith, united in such a way that they
form a single object, the owner of the principal thing acquires
the accessory, indemnifying the former owner thereof for its
value. (375)
Types of accession with respect to movable party:
1. Adjunction (or conjuction) - two or more different things
are so united that they form a single object, but each
component part preserves its nature

Ex.: When a diamond is attached to a ring, earn an
accessory is fused or welded to another object made of
paints on another person’s paper or canvas, when a person
writes on another person’s paper or parchment

2. Mixture (or commixtion) - two things of the same or
different kinds are mixed, and the two things are not
separable

Ex.: When rice belonging to different persons are mixed up

3. Specification - happens when a person employs the
material of another in whole or in part to make a thing of
a different kind

Ex.: When a sculptor makes a sculpture out of another
person’s marble or clay
Adjunction
Art. 467. The principal thing, as between two things
incorporated, is deemed to be that to which the other has
been united as an ornament, or for its use or perfection. (376)
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Property Law Midterms Reviewer
Principal
Art. 468. If it cannot be determined by the rule given in the
preceding article which of the two things incorporated is the
principal one, the thing of the greater value shall be so
considered, and as between two things of equal value, that of
the greater volume.


In painting and sculpture, writings, printed matter, engraving
and lithographs, the board, metal, stone, canvas, paper or
parchment shall be deemed the accessory thing. (377)
Separation
Art. 469. Whenever the things united can be separated
without injury, their respective owners may demand their
separation.
Nevertheless, in case the thing united for the use,
embellishment or perfection of the other, is much more
precious than the principal thing, the owner of the former may
demand its separation, even though the thing to which it has
been incorporated may suffer some injury. (378)
Adjunction in bad faith
Art. 470. Whenever the owner of the accessory thing has
made the incorporation in bad faith, he shall lose the thing
incorporated and shall have the obligation to indemnify the
owner of the principal thing for the damages he may have
suffered.
If the one who has acted in bad faith is the owner of the
principal thing, the owner of the accessory thing shall have a
right to choose between the former paying him its value or
that the thing belonging to him be separated, even though for
this purpose it be necessary to destroy the principal thing;
and in both cases, furthermore, there shall be indemnity for
damages.
If either one of the owners has made the incorporation with
the knowledge and without the objection of the other, their
respective rights shall be determined as though both acted in
good faith. (379a)
Indemnity
Art. 471. Whenever the owner of the material employed
without his consent has a right to an indemnity, he may
demand that this consist in the delivery of a thing equal in
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
kind and value, and in all other respects, to that employed, or
else in the price thereof, according to expert appraisal. (380)
Mixture
Art. 472. If by the will of their owners two things of the same
or different kinds are mixed, or if the mixture occurs by
chance, and in the latter case the things are not separable
without injury, each owner shall acquire a right proportional
to the part belonging to him, bearing in mind the value of the
things mixed or confused. (381)
Mixture in bad faith
Art. 473. If by the will of only one owner, but in good faith,
two things of the same or different kinds are mixed or
confused, the rights of the owners shall be determined by the
provisions of the preceding article.
If the one who caused the mixture or confusion acted in bad
faith, he shall lose the thing belonging to him thus mixed or
confused, besides being obliged to pay indemnity for the
damages caused to the owner of the other thing with which
his own was mixed. (382)
Specification
Art. 474. One who in good faith employs the material of
another in whole or in part in order to make a thing of a
different kind, shall appropriate the thing thus transformed as
his own, indemnifying the owner of the material for its value.
If the material is more precious than the transformed thing or
is of more value, its owner may, at his option, appropriate the
new thing to himself, after first paying indemnity for the value
of the work, or demand indemnity for the material.
If in the making of the thing bad faith intervened, the owner of
the material shall have the right to appropriate the work to
himself without paying anything to the maker, or to demand
of the latter that he indemnify him for the value of the
material and the damages he may have suffered. However,
the owner of the material cannot appropriate the work in case
the value of the latter, for artistic or scientific reasons, is
considerably more than that of the material. (383a)
Sentimental value
Art. 475. In the preceding articles, sentimental value shall be
duly appreciated. (n)
21
Property Law Midterms Reviewer Atty. Donna Z. Gasgonia

‣ In determining the value of the adjoined, mixed or specified

thing, what else is considered other than the actual value
of the materials involved? 



Add sentimental value (Art. 475).

Unjust enrichment
It is clear that we have here a case of accession by
specification: Leonora & Company, as purchaser acting in
good faith, spending P11,299.00 for the reconditioning of the
tank which is later adjudged to belong to petitioner Aguirre.
Although ordinarily, therefore, Aguirre as owner of the tank,
would be entitled to any accession thereto, the rule is
different where the works or improvements or the accession
were made on the property by one who acted in good faith
(Art. 466 of the New Civil Code). To uphold petitioner's
contention that he is entitled to the sum of P14,500.00 the
price of the tank in its present condition, would be to allow
him to enrich himself at the expense of another.He should
reimburse to Leonora & Company the sum of P11,299.00.
(Aguirre vs. Pheng, No. L-20851, September 3, 1966, 18 SCRA
18)

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Property Law Midterms Reviewer
QUIETING OF TITLE (Arts. 476-481)
Quieting of title
Art. 476. Whenever there is a cloud on title to real property or
any interest therein, by reason of any instrument, record,
claim, encumbrance or proceeding which is apparently valid
or effective but is in truth and in fact invalid, ineffective,
voidable, or unenforceable, and may be prejudicial to said
title, an action may be brought to remove such cloud or to
quiet the title.
An action may also be brought to prevent a cloud from being
cast upon title to real property or any interest therein.
Invalid instrument
An action for quieting of title is a remedy which may be
availed of only when by reason of any instrument, record,
claim, encumbrance or proceeding, which appears valid but
is, in fact, invalid, ineffective, voidable or unenforceable, a
cloud is thereby cast on the complainant’s title to real
property or any interest therein. (Heirs of Enrique Diaz vs.
Virata, G.R. No. 162037, August 7, 2006, 498 SCRA 141)
Sole issue
The only issue in an action to quiet title is whether there is a
cloud on a title to real property because of any instrument,
record, claim, encumbrance or proceeding that has a prima
facie appearance of validity.
An action for quieting of title is not the appropriate remedy
where the action would require the court hearing it to modify
or interfere with the judgment or order of another co-equal
court. (Foster-Gallego vs. Galang, G.R. No. 130228, July 27,
2004, 435 SCRA 275)
Requisites
An action for quieting of title is essentially a common law
remedy grounded on equity.
For an action to quiet title to prosper, two indispensable
requisites must concur, namely: (1) the plaintiff or
complainant has a legal or an equitable title to or interest in
the real property subject of the action; and (2) the deed,
claim, encumbrance, or proceeding claimed to be casting
cloud on his title must be shown to be in fact invalid or
inoperative despite its prima facie appearance of validity or
legal efficacy.
Personality
A vendee in an oral contract to convey land who had made
part payment thereof, entered upon the land and had made
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
valuable improvements thereon, is entitled to bring suit to
clear his title against the vendor who had refused to transfer
the title to him. It is not necessary that the vendee has an
absolute title, an equitable title being sufficient to clothe him
with personality to bring an action to quiet title.
Prescription cannot be invoked against the private
respondents for it is aphoristic that an action to quiet title to
property in one’s possession is imprescriptible. (Pingol vs.
Court of Appeals, G. R. No. 102909, September 6, 1993, 226
SCRA 118)
Friar Lands Law
The certificate of sale issued by the Bureau of Lands is a
conveyance of the ownership of the property, subject only to
the resolutory condition that the sale may be cancelled if the
price agreed upon is not paid for in full.
Approval by the Secretary of Agriculture is indispensable for
the validity of the sale of such friar lands.
Registration does not vest title, it is merely evidence of such
title over a particular property.
An adverse claimant of a registered land who is in possession
thereof for a long period of time is not barred from bringing
an action for reconveyance which in effect seeks to quiet title
to the property against a registered owner relying upon a
Torrens title which was illegally or wrongfully acquired.
(Solid State Multi-Products Corporation vs. Court of Appeals,
G.R. No. 83383, May 6, 1991, 196 SCRA 630)
Res and jurisdiction
In an action for quieting of title, the competent court is
tasked to determine the respective rights of the complainant
and the other claimants, not only to place things in their
proper places, and make the claimant, who has no rights to
said immovable, respect and not disturb the one so entitled,
but also for the benefit of both, so that whoever has the right
will see every cloud of doubt over the property dissipated, and
he can thereafter fearlessly introduce any desired
improvements, as well as use, and even abuse the property.
The cloud on title consists of: (1) any instrument, record,
claim, encumbrance or proceeding; (2) which is apparently
valid or effective; (3) but is in truth and in fact invalid,
ineffective, voidable, or unenforceable; and (4) may be
prejudicial to the title sought to be quieted. The fourth
element is not present in the case at bar.
Significantly, an action to quiet title is characterized as a
proceeding quasi in rem. In an action quasi in rem, an
individual is named a defendant and the purpose of the
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Property Law Midterms Reviewer
proceeding is to subject his interests to the obligation or loan
burdening the property. Actions quasi in rem deal with the
status, ownership or liability of a particular property but
which are intended to operate on these questions only as
between the particular parties to the proceedings and not to
ascertain or cut off the rights or interests of all possible
claimants. The judgment therein is binding only upon the
parties who joined in the action.
A petition for declaratory relief gives a practical remedy for
ending controversies that have not reached the state where
another relief is immediately available; and supplies the need
for a form of action that will set controversies at rest before
they lead to a repudiation of obligations, an invasion of rights,
and a commission of wrongs
The nature of the relief in an action for declaratory relief is
that the judgment in the case can be carried into effect
without requiring the parties to pay damages or to perform
any act. (Phil-Ville Development and Housing Corporation vs.
Bonifacio, G.R. No. 167391, June 8, 2011, 651 SCRA 327)

Equity
Regarding the nature of the action filed before the trial court,
quieting of title is a common law remedy for the removal of
any cloud upon or doubt or uncertainty with respect to title to
real property. Originating in equity jurisprudence, its purpose
is to secure “. . .an adjudication that a claim of title to or an
interest in property, adverse to that of the complainant, is
invalid, so that the complainant and those claiming under him
may be forever afterward free from any danger of hostile
claim.” In an action for quieting of title, the competent court
is tasked to determine the respective rights of the
complainant and other claimants, “. . . not only to place
things in their proper place, to make the one who has no
rights to said immovable respect and not disturb the other,
but also for the benefit of both, so that he who has the right
would see every cloud of doubt over the property dissipated,
and he could afterwards without fear introduce the
improvements he may desire, to use, and even to abuse the
property as he deems best.
The ownership of an immovable property shall belong to the
purchaser who in good faith registers it first in the registry of
property.
The defense of indefeasibility of a Torrens Title does not
extend to a transferee who takes the certificate of title with
notice of a flaw. (Baricuatro, Jr. vs. Court of Appeals, G.R. No.
105902, February 9, 2000, 325 SCRA 127)
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
Declaratory relief
Where the trial court has jurisdiction over the subject matter
and parties in an action for quieting of title, then it can rule on
all issues in the case, including those on a claimantÊs status,
filiation, and heirship, in exercise of its jurisdiction.
The Court may have declared in previous cases that an action
for reconveyance is in the nature of an action for quieting of
title, but the two are distinct remedies.
A declaration of heirship cannot be made in an ordinary civil
action such as an action for reconveyance, but must only be
made in a special proceeding, for it involves the
establishment of a status or right. While the appropriate
special proceeding for declaration of heirship would be the
settlement of the estate of the decedent, nonetheless, an
action for quieting of title is also a special proceeding,
specifically governed by Rule 63 of the Rules of Court on
declaratory relief and similar remedies. (Republic vs.
Mangotara, G.R. No. 170375, July 7, 2010, 624 SCRA 360)

Equitable title
Art. 477. The plaintiff must have legal or equitable title to, or
interest in the real property which is the subject matter of the
action. He need not be in possession of said property.
Accion publiciana
The authority given to the Lands Department over the
disposition of public lands does not exclude the courts from
their jurisdiction over possessory action, the public character
of the land notwithstanding
The administration and disposition of public lands are
committed by law to the Director of Lands primarily, and
ultimately, to the Secretary of Agriculture and Natural
Resources. The jurisdiction of the Bureau of Lands is
confined to the determination of the respective rights of rival
claimants to public lands or to cases which involve
disposition and alienation of public lands. The jurisdiction of
courts in possessory actions involving public lands is limited
to the determination of who has the actual physical
possession or occupation of the land in question (in forcible
entry cases, before Municipal Courts) or, the better right of
possession (in accion publiciana, in cases before Courts of
First Instance, now Regional Trial Courts.)
In order to afford complete relief to the parties, the court may
determine incidentally the ownership, or the status of the
legal title to the property or the right to the possession
thereof. (Padre vs. Court of Appeals, G.R. Nos. 84902-03,
October 2, 1992, 214 SCRA 446)
24
Property Law Midterms Reviewer Atty. Donna Z. Gasgonia

RUINOUS BUILDINGS AND TREES IN DANGER OF FALLING

Two types of action
Art. 478. There may also be an action to quiet title or remove
a cloud therefrom when the contract, instrument or other
obligation has been extinguished or has terminated, or has
been barred by extinctive prescription.
Obligation to return or reimburse
Art. 479. The plaintiff must return to the defendant all
benefits he may have received from the latter, or reimburse
him for expenses that may have redounded to the plaintiff's
benefit.
Principle of General Law
Art. 480. The principles of the general law on the quieting of
title are hereby adopted insofar as they are not in conflict
with this Code.
Procedure
Art. 481. The procedure for the quieting of title or the removal
of a cloud therefrom shall be governed by such rules of court
as the Supreme Court shall promulgated.
Non-interference
In an action for quieting of title, the court is tasked to
determine the respective rights of the parties so that the
complainant and those claiming under him may be forever
free from any danger of hostile claim.
(Arts. 482-483)
Ruinous buildings
Art. 482. If a building, wall, column, or any other construction
is in danger of falling, the owner shall be obliged to demolish
it or to execute the necessary work in order to prevent it from
falling.
If the proprietor does not comply with this obligation, the
administrative authorities may order the demolition of the
structure at the expense of the owner, or take measures to
insure public safety. (389a)
Trees in danger of falling
Art. 483. Whenever a large tree threatens to fall in such a way
as to cause damage to the land or tenement of another or to
travelers over a public or private road, the owner of the tree
shall be obliged to fell and remove it; and should he not do so,
it shall be done at his expense by order of the administrative
authorities. (390a)
‣ “Large trees” do not include papayas. (Huhu)

Laches need not be specifically pleaded· on its own initiative,

the court may consider it in determining the rights of the
parties. It is an enshrined rule that even a registered owner
may be barred from recovering possession of property by
virtue of laches.

The elements of laches are: (1) conduct of a party on the

basis of which the other party seeks a remedy; (2) delay in
asserting oneÊs rights, despite having had knowledge or
notice of the other party’s conduct and having been afforded
an opportunity to institute a suit; (3) lack of knowledge or
notice on the part of a party that the person against whom
laches is imputed would assert the right; and (4) injury or
prejudice to the party asserting laches in the event the suit is
allowed to prosper.

Nemo potest plus juris ad alium transferre quam ipse habet—

No one can transfer a greater right to another than he himself
has. The spring cannot rise higher than the source. (Rumarate
vs Gonzalez G.R. No. 168222, April 18, 2006, 487 SCRA 317)

DRH Palis DLSU Law | 1st Sem, 2017-2018 25

Property Law
CO-OWNERSHIP (Arts. 484-501)
Co-ownership
Art. 484. There is co-ownership whenever the ownership of
an undivided thing or right belongs to different persons.
In default of contracts, or of special provisions, co- ownership
shall be governed by the provisions of this Title. (392)
‣ To determine co-ownership: Look at the contract first,
special provisions second, and Civil Code last
Causes when co-ownership may arise
1. Contract
2. Law
3. Succession
4. Testamentary disposition (or donation inter vivos)
5. Fortuitous event (or chance)
6. Occupancy
Aliquot share
Co-ownership is terminated upon judicial or extrajudicial
partition of the properties owned in common. Partition, in
general, is the separation, division and assignment of a thing
held in common among those to whom it may belong. (Art.
1079, Civil Code)
Every act which is intended to put an end to indivision among
co-heirs and legatees or devisees is deemed to be a partition,
although it should purport to be a sale, an exchange, a
compromise, or any other transaction. (Art. 1082, Civil Code)
To be considered a co-owner, one “must have a spiritual part
of a thing which is not physically divided, or each of them is
an owner of the whole, and over the whole he exercises the
right of dominion, but he is at the same time the owner of a
portion which is truly abstract.” (Cruz vs. Court of Appeals,
G.R. No. 122904, April 15, 2005)
Specific portion
It is a basic principle in the law of co-ownership that no
individual co-owner can claim title to any definite portion of
the land or thing owned in common until the partition thereof.
Prior to that time, all that the co-owner has is an ideal or
abstract quota or proportionate share in the entire thing
owned in common by all the co-owners.
While a co-owner has the right to freely sell and dispose of
his undivided interest, he has no right to sell a divided part of
the real estate owned in common.
DRH Palis DLSU Law | 1st Sem, 2017-2018
Midterms Reviewer Atty. Donna Z. Gasgonia
A co-owner may not convey a physical portion of the land
owned in common.
A co-owner may not even adjudicate to himself any
determinate portion of land owned in common. (Diversified
Credit Corporation vs. Rosado, No. L-27933, December 24,
1968, 26 SCRA 470)
Occupancy
Things appropriable by nature which are without an owner,
such as animals that are the object of hunting and fishing,
hidden treasure and abandoned movables, are acquired by
occupation. (Art. 713)
The ownership of a piece of land cannot be acquired by
occupation. (Art. 714)
The ambergris which is the subject-matter of this litigation
was the undivided common property of the plaintiffs and one
of the defendants. This common ownership was acquired by
occupancy. None of them had any right to sell said amber,
there being an express agreement between the co-owners not
to sell it without the consent of all. Held: That the two sales
mentioned in the opinion having been made without the
consent of all the co-owners, the same have no effect, except
as to the portion belonging to those who made them.
The right of action for recovery pertaining to each co-owner,
derived from the right of ownership inherent in the co-
ownership, can be exercised not only against strangers, but
against the co-owners themselves when the latter perform
with respect to the thing held in common acts for their
exclusive benefit, or of exclusive ownership, or which are
prejudicial to, and in violation of, the right of the community.
(Punsalan vs. Boon Liat, No. 18009, January 10, 1923, 44 Phil.
320)
Share of co-owners
Art. 485. The share of the co-owners, in the benefits as well
as in the charges, shall be proportional to their respective
interests. Any stipulation in a contract to the contrary shall be
void. 

The portions belonging to the co-owners in the co- ownership
shall be presumed equal, unless the contrary is proved.
(393a)
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Property Law Midterms Reviewer
Marriage
The words “married to” preceding the name of a spouse are
merely descriptive of the civil status of the registered owner.
Such words do not prove co- ownership.
Benjamin and Sally (the parties in the case) cohabitated
without the benefit of marriage. Thus, only the properties
acquired by them through their actual joint contribution of
money, property, or industry shall be owned by them in
common in proportion to their respective contributions.
In cases of cohabitation not falling under the preceding
Article, only the properties acquired by both of the parties
through their actual joint contribution of money, property, or
industry shall be owned by them in common in proportion to
their respective contributions. In the absence of proof to the
contrary, their contributions and corresponding shares are
presumed to be equal. The same rule and presumption shall
apply to joint deposits of money and evidences of credit.


If one of the parties is validly married to another, his or her
share in the co-ownership shall accrue to the absolute
community or conjugal partnership existing in such valid
marriage. If the party who acted in bad faith is not validly
married to another, his or her shall be forfeited in the manner
provided in the last paragraph of the preceding Article.
The foregoing rules on forfeiture shall likewise apply even if
both parties are in bad faith. (Art. 148, Family Code) (Go-
Bangayan vs. Bangayan, Jr., G.R. No. 201061, July 3, 2013, 700
SCRA 702)
Limitations
Art. 486. Each co-owner may use the thing owned in
common, provided he does so in accordance with the purpose
for which it is intended and in such a way as not to injure the
interest of the co- ownership or prevent the other co-owners
from using it according to their rights. The purpose of the co-
ownership may be changed by agreement, express or implied.
(394a)
‣ Does co-ownership create a trust? 
 half of the rent which the room could have produced had


YES! Co-ownership is a form of trust and every co-owner
is a trustee for the other. In co-ownership, the
relationship of each co-owner to the other co-owners is
fiduciary in character and attribute. Whether established
of law or by agreement of the co-owners, the property or
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
thing held pro-indiviso is impressed with a fiducial nature
that each co-owner becomes a trustee for the benefit of
his co-owners and he may not do any act prejudicial to
the interest of his co-owners. (Sotto vs. Teves, 86 SCRA
154)
‣ What is a cestui que trust?

A cestui que trust is a person for whose benefit a trust is
created; a beneficiary. Although legal title of the trust is
vested in the trustee, the cestui que trust is the
beneficiary who is entitled to all benefits from a trust.
(legal-dictionary.thefreedictionary.com/
cestui+que+trust)



A fiduciary relationship may exist even if the title to the
property subject to the trust appears in the name of the
trustee alone, because in cases of trusteeship, the legal
title usually appears in the name of the trustee, while the
equitable title remains with the cestui que trust. (Sotto
vs. Teves, 86 SCRA 154)
Restrictions and shares
‣ What are the restrictions of a co-owner with respect to his
other co-owners when he uses the thing owned in
common?



Each co-owner may use the thing owned in common
provided he does so:

1. In accordance with the purpose for which the co-
ownership is intended;

2. In such a way as not to injure the interest of the co-
ownership; and

3. In such a way as not to prevent the other co-owners
from using it according to their rights.
‣ A and B owned a common two-story house. The upper floor
was used as a dwelling, the lower floor for rent. If A lives
on the upper floor and uses a room on the lower floor, can
B demand rent?

For the use of the room on the upper floor, NO.

For the use of the room on the lower floor, YES, for one-
it been leased to another person. (Pardell vs. Bartolome,
23 Phil. 450)
Ejectment
Art. 487. Any one of the co-owners may bring an action in
ejectment. (n)
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Property Law Midterms Reviewer
Recovery
Only one of the co-owners, namely the co-owner who filed the
suit for the recovery of the co-owned property, is an
indispensable party thereto. The other co-owners are not
indispensable partners. They are not even necessary parties,
for a complete relief can be accorded in a suit even without
their participation, since the suit is presumed to have been
filed for the benefit of all co-owners. (Navarro vs. Escobido,
G.R. No. 153788, November 27, 2009, 606 SCRA 1)
Attorney-in-fact
Article 487 of the Civil Code provides that anyone of the co-
owners of an immovable may bring an action in ejectment. A
co-owner may thus bring an ejectment action without joining
the other co-owners, the suit being deemed instituted for the
benefit of all. And the term, “action in ejectment,” includes a
suit of forcible entry (detentacion) or unlawful detainer
(desahucio). (Sering vs. Plazo, No. L-49731, September 29,
1988, 166 SCRA 85)
Action to compel sale
Article 494 of the Civil Code provides that no co-owner shall
be obliged to remain in the co-ownership, and that each co-
owner may demand at any time partition of the thing owned
in common insofar as his share is concerned. Corollary to this
rule, Art. 498 of the Code states that whenever the thing is
essentially indivisible and the co-owners cannot agree that it
be allotted to one of them who shall indemnify the others, it
shall be sold and its proceeds accordingly distributed. This is
resorted to (1) when the right to partition the property is
invoked by any of the co-owners but because of the nature of
the property it cannot be subdivided or its subdivision would
prejudice the interests of the co-owners, and (b) the co-
owners are not in agreement as to who among them shall be
allotted or assigned the entire property upon proper
reimbursement of the co-owners. In one case, this Court
upheld the order of the trial court directing the holding of a
public sale of the properties owned in common pursuant to
Art. 498 of the Civil Code.
Each co-owner of property held pro indiviso exercises his
rights over the whole property and may use and enjoy the
same with no other limitations than that he shall not injure
the interests of his co-owners.
Co-ownership deemed terminated and the right to enjoy
possession jointly also ceased upon filing and the granting of
action to compel the sale of the property and the ejectment
of respondent. (Aguilar vs. Court of Appeals, G.R. No. 76351,
October 29, 1993, 227 SCRA 472)
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
Obligation to contribute
Art. 488. Each co-owner shall have a right to compel the
other co-owners to contribute to the expenses of preservation
of the thing or right owned in common and to the taxes. Any
one of the latter may exempt himself from this obligation by
renouncing so much of his undivided interest as may be
equivalent to his share of the expenses and taxes. No such
waiver shall be made if it is prejudicial to the co-ownership.
(395a)
Co-owner’s waiver
‣ In a building owned in common, urgent repairs are needed;
otherwise the building is going to collapse. Mr. A owns a
2/3 interest in a building, B and C own 1/6 each. If B and C
each have just enough funds to 1/6 of the expected
expenses for the repair of the building, and then A
renounces in their favor all his interest in the building, the
repair may become impossible of accomplishment for lack
of funds. Is the waiver valid?



NO! The waiver is void. B and C can proceed to have the
building repaired, and A would still be bound to pay his
share of the expenses, notwithstanding his renunciation.
(Tolentino, p. 177)

Agreement on expenses
Art. 489. Repairs for preservation may be made at the will of
one of the co-owners, but he must, if practicable, first notify
his co-owners of the necessity for such repairs. Expenses to
improve or embellish the thing shall be decided upon by a
majority as determined in Article 492. (n)
“Practicable” means that something can be done;
“practical” means useful (Paras, p. 331)
Different owners
Art. 490. Whenever the different stories of a house belong to
different owners, if the titles of ownership do not specify the
terms under which they should contribute to the necessary
expenses and there exists no agreement on the subject, the
following rules shall be observed:
(1) The main and party walls, the roof and the other things
used in common, shall be preserved at the expense of all the
owners in proportion to the value of the story belonging to
each;
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Property Law Midterms Reviewer
(2) Each owner shall bear the cost of maintaining the floor of
his story; the floor of the entrance, front door, common yard
and sanitary works common to all, shall be maintained at the
expense of all the owners pro rata;
(3) The stairs from the entrance to the first story shall be
maintained at the expense of all the owners pro rata, with the
exception of the owner of the ground floor; the stairs from the
first to the second story shall be preserved at the expense of
all, except the owner of the ground floor and the owner of the
first story; and so on successively. (396)
Alterations
Art. 491. None of the co-owners shall, without the consent of
the others, make alterations in the thing owned in common,
even though benefits for all would result therefrom.
However, if the withholding of the consent by one or more of
the co-owners is clearly prejudicial to the common interest,
the courts may afford adequate relief. (397a)
Alterations (Paras, pp. 349-350)
An alteration is a change
(a)  which is more or less permanent; 

(b)  which changes the use of the thing; and 
 Art. 492. For the administration and better enjoyment of the
(c)  which prejudices the condition of the thing or its
enjoyment by the others. [Alteration is an act of ownership;
may be material or metaphysical (change in use); and gives
rise to a real right over the property owned in common]. 
 by the co-owners who represent the controlling interest in the


Examples of alteration

1. Sale, donation, or mortgage, etc. of the whole property
2. Sale, donation or mortgage, etc. of a part of the property
but with definite boundaries. (The sale is not void; how- ever,
it is subject to the result of the subsequent partition). (Lopez
v. Cuaycong, 74 Phil. 601).
3. A voluntary easement
4. Lease of real property if
a) the lease is recorded (registered)
b) or the lease is for more than one year (whether re-
corded or not)
5. The construction of a house on a lot owned in common
6. Any other act of strict dominion or ownership
7. Impliedly, contracts of long duration
Alienation
It is settled that alterations include any act of strict dominion
or ownership and any encumbrance or disposition has been
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
held implicitly to be an act of alteration. Alienation of the
thing by sale of the property is an act of strict dominion.
However, the ruling that alienation is alteration does not
mean that a sale of commonly owned real property is covered
by the second paragraph of Article 491, such that if a co-
owner withholds consent to the sale, the courts, upon a
showing of a clear prejudice to the common interest, may, as
adequate relief, order the grant of the withheld consent.
There is co-ownership whenever the ownership of an
undivided thing, belongs to different persons.
Co-owners have over their part, the right of full and absolute
ownership. That part which ideally belongs to them, or their
mental portion, may be disposed of as they please,
independent of the decision of their co-owners.
Article 494 of the Civil Code provides that no co-owner shall
be obliged to remain in the co-ownership, and that each co-
owner may demand at any time partition of the thing owned
in common insofar as his share is concerned.
A partition proceeding accords all parties the opportunity to
be heard. (Arambulo vs. Nolasco, G.R. No. 189420, March 26,
2014, 720 SCRA 95)
Administration
thing owned in common, the resolutions of the majority of the
co-owners shall be binding.


There shall be no majority unless the resolution is approved
object of the co- ownership.


Should there be no majority, or should the resolution of the
majority be seriously prejudicial to those interested in the
property owned in common, the court, at the instance of an
interested party, shall order such measures as it may deem
proper, including the appointment of an administrator.


Whenever a part of the thing belongs exclusively to one of the
co-owners, and the remainder is owned in common, the
preceding provision shall apply only to the part owned in
common. (398)
‣ What constitutes “resolution of a majority of the co-
owners” when the administration and bater enjoyment of
the thing owned in common is being determine?



Majority consists of co-owners who represent the
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Property Law Midterms Reviewer
controlling interests (i.e., at least 51% of the financial
interest) in the object of the co-ownership. The majority
likewise decides the expenses to improve or embellish the
common property. Notice must first be given to the
minority unless it is impracticable to do so. (see Art. 489;
De Leon, p. 253)
‣ What happens when there is no majority or when the
resolutions of the majority are seriously prejudicial to the
co-ownership? 



Go to court! Partition! (Art. 494)
Rights of each co-owner
Art. 493. Each co-owner shall have the full ownership of his
part and of the fruits and benefits pertaining thereto, and he
may therefore alienate, assign or mortgage it, and even
substitute another person in its enjoyment, except when
personal rights are involved. But the effect of the alienation
or the mortgage, with respect to the co-owners, shall be
limited to the portion which may be allotted to him in the
division upon the termination of the co-ownership. (399)
‣ Can a co-owner sell a concrete, specific or determinate
part of the thing owned in common?
 consent of the other co-owners is not null and void. Proper


YES!



1. The fact that a deed of sale appears to convey a definite
or segregated portion of the property under co-ownership
that is still undivided does not per se render the sale a
nullity. 
 Article 494 of the Civil Code on co-ownership, means that the


The sale is valid subject to the condition that the interests
acquire by the buyer must be limited to the part that may
be assigned to the co-owner-seller in the division upon the
termination of the co-ownership. In other words, the sale
only affects his proportionate or abstract share in the
property owned in common, subject to the result of the
partition, but not those of the other co-owners who did not
consent to the sale. 



2. There may be a valid sale of a definite portion of the
property co-owned even before actual partition where the
rule of estoppel applies. Thus, in a case, where the co-
owner as vendor pointed out the location and even
indicated the boundaries of the portion of a particular land
he was selling without objection, protest or complaint by
the other co-owners, but on the contrary acquiesced in and
tolerated such alienation and the occupation of said
portion, it was held that a factual partition or termination
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
of the co-ownership, although partial, was created and
barred not only the vendor but also his heirs from
asserting as against the vendee any right or title in
derogation of the deed of sale executed by the said vendor
(Pamplona vs. Moreto, 96 SCRA 775; Del Banco vs. IAC,
156 SCRA 55)

‣ What is the effect on the property if a co-owner sells the
whole property?



Even if the co-owner sells the whole property as his own,
or without the consent of the other co-owners, the sale is
valid only insofar as his ideal quota is concerned unless
the sale is authorized by the other co-owners. Since a co-
owner is entitled to sell his undivided share, a sale of the
entire property by one co-owner will only transfer the
rights of said co-owner to the buyer, thereby making the
buyer a co-owner of the property.
Sale
Even if a co-owner sells the whole property as his, the sale
will affect only his own share but not those of the other co-
owners who did not consent to the sale.
Sale of the entire property by one co-owner without the
action is the division of the common property.
The appropriate recourse of the co-owners who did not
consent to the sale of the entire property and the sale of the
undivided shares of some of the co-owners is partition.
action for partition is imprescriptible and cannot be barred by
prescription.
Prescription will not lie in favor of the respondent as against
the petitioners who remain the registered owners of the
disputed parcel of land. Prescription is unavailing not only
against the registered owner but also equally against the
latter’s hereditary successors.
Mere fact of delay in asserting a right is insufficient to
constitute laches. It is required that (1) complainant must
have had knowledge of the conduct of defendant or of one
under whom he claims and (2) he must have been afforded an
opportunity to institute suit. Laches is not concerned with
mere lapse of time.
Laches has been defined as the failure or neglect, for an
unreasonable length of time to do that which by exercising
due diligence could or should have been done earlier; it is
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Property Law Midterms Reviewer
negligence or omission to assert a right within a reasonable
time warranting a presumption that the party entitled to
assert it either has abandoned it or declined to assert it.
(Bailon-Casilao vs. Court of Appeals, No. L-78178, April 15,
1988, 160 SCRA 738)
Termination
Art. 494. No co-owner shall be obliged to remain in the co-
ownership. Each co-owner may demand at any time the
partition of the thing owned in common, insofar as his share
is concerned.
Nevertheless, an agreement to keep the thing undivided for a
certain period of time, not exceeding ten years, shall be valid.
This term may be extended by a new agreement.
A donor or testator may prohibit partition for a period which
shall not exceed twenty years.
Neither shall there be any partition when it is prohibited by
law.
No prescription shall run in favor of a co-owner or co-heir
against his co-owners or co-heirs so long as he expressly or
impliedly recognizes the co- ownership. (400a)
Exception to to the general rule:
If there has already been a partition, a co-owner can sell his
part of the property owned in common.
‣ Does the sale without the consent of all the co-owners
invalidate the sale or render it void?
 the other co-owners and that they have been categorically


NO! That a thing is sold without the consent of all the co-
owners does not invalidate the sale or render it void.
Article 493 of the Civil Code recognizes the absolute right
of a co-owner to freely dispose of his pro indiviso share as
well as the fruits and other benefits arising from that
share, independently of the other co-owners. (Pangan vs.
Perreras 597 SCRA 253)
Judicial decree
A co-owner has the right to sell his portion of the co-owned
property. The sale by one co-owner of part of a particular lot
co-owned is within his right pro-indiviso is valid in its entirety
but he may not convey a physical portion with boundaries of
the land owned in common.
Actual possession and enjoyment of several portions of the
property does not provide proof that there was actual
partition and co-ownership terminated.
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
A co-owner cannot, without the conformity of the other co-
owners or a judicial decree of partition issued pursuant to the
provision of Rule 69 of the Rules of Court (Rule 71 of the Old
Rules), adjudicate to himself in fee simple a determinate
portion of the lot owned in common, as his share therein, to
the exclusion of other co-owners.
It is a basic principle in the law of co-ownership that no
individual co-owner can claim any definite portion thereof.
Actual possession and enjoyment by some of the petitioners
cannot be considered a repudiation of the co-ownership.
Action to demand partition is imprescriptible or cannot be
barred by laches. (Del Banco vs. Intermediate Appellate Court,
No. L-72694, December 1, 1987, 156 SCRA 55)
Repudiation
It is a settled rule that possession by one-co-owner will not be
regarded as adverse to the other co-owners but in fact as
beneficial to all of them. Hence, as long as his co-ownership
is recognized, an action to compel partition will not prescribe
and may be filed at any time against the actual possessor by
any of the other co-owners. However, if the co-owner actually
holding the property asserts exclusive dominion over it
against the other co-owners, the corollary of the rule is that
he can acquire sole title to it after the lapse of the prescribed
prescriptive period. From that moment, the question involved
will be one of ownership and no longer mere partition.
For title to prescribe in favor of the co-owner, however, there
must be a clear showing that he has repudiated the claims of
advised of the exclusive claim he is making to the property in
question. It is only when such unequivocal notice has been
given that the period of prescription will begin to run against
the other co-owners and ultimately divest them of their own
title if they do not seasonably defend it.
Tax declarations are indicia, but not conclusive proof of
ownership.
Adverse possession requires the concurrence of the following
circumstances: 1.) That the trustee has performed
unequivocal acts amounting to an ouster of the cestui que
trust; 2.) That such positive acts of repudiation had been
made known to the cestui que trust; and 3.) That the evidence
thereon should be clear and conclusive. (Pangan vs. Court of
Appeals, No. L-39299, October 18, 1988, 166 SCRA 375)
Unserviceable thing
Art. 495. Notwithstanding the provisions of the preceding
article, the co-owners cannot demand a physical division of
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Property Law Midterms Reviewer
the thing owned in common, when to do so would render it
unserviceable for the use for which it is intended. But the co-
ownership may be terminated in accordance with Article 498.
(401a)
Partition
Art. 496. Partition may be made by agreement between the
parties or by judicial proceedings. Partition shall be governed
by the Rules of Court insofar as they are consistent with this
Code. (402)
In general, the Statute of Frauds does not apply to an action
for partition
An action for partition—which is typically brought by a person
claiming to be co-owner of a specified property against a
defendant or defendants whom the plaintiff recognizes to be
co-owners—may be seen to present simultaneously two
principal issues. First, there is the issue of whether the
plaintiff is indeed a co-owner of the property sought to be
partitioned. Second, assuming that the plaintiff successfully
hurdles the first issue, there is the secondary issue of how the
property is to be divided between plaintiff and defendant(s)—
i.e., what portion should go to which co-owner.
An action for partition may be seen to be at once an action
for declaration of co-ownership and for segregation and
conveyance of a determinate portion of the property involved.
In the words of Article 494 of the Civil Code, “each co-owner
may demand at any time the partition of the thing owned in
common, insofar as his share is concerned.” No matter how
long the co-ownership has lasted, a co-owner can always opt
out of the co-ownership, and provided the defendant co-
owners or co-heirs have theretofore expressly or impliedly
recognized the co-ownership, they cannot set up as a defense
the prescription of the action for partition. But if the
defendants show that they had previously asserted title in
themselves adversely to the plaintiff and for the requisite
period of time, the plaintiff’s right to require recognition of his
status as a co-owner will have been lost by prescription and
the court cannot issue an order requiring partition. (Roque vs.
Intermediate Appellate Court, 65 SCRA 118)
Partition (Rule 69, Rules of Court)
Section 3. Commissioners to make partition when parties fail
to agree. — If the parties are unable to agree upon the
partition, the court shall appoint not more than three (3)
competent and disinterested persons as commissioners to
make the partition, commanding them to set off to the
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
plaintiff and to each party in interest such part and proportion
of the property as the court shall direct. (3a)
Section 5. Assignment or sale of real estate by commissioners.
— When it is made to appear to the commissioners that the
real state, or a portion thereof, cannot be divided without
prejudice to the interests of the parties, the court may order it
assigned to one of the parties willing to take the same,
provided he pays to the other parties such amount as the
commissioners deem equitable, unless one of the interested
parties asks that the property be sold instead of being so
assigned, in which case the court shall order the
commissioners to sell the real estate at public sale under
such conditions and within such time as the court may
determine. (5a)
Actual partition should follow the procedure laid down in
Rule 69, Rules of Court
Actual possession and enjoyment of several portions of the
property does not provide proof that there was actual
partition and co-ownership terminated.
A co-owner cannot, without the conformity of the other co-
owners or a judicial decree of partition issued pursuant to the
provision of Rule 69 of the Rules of Court (Rule 71 of the Old
Rules), adjudicate to himself in fee simple a determinate
portion of the lot owned in common, as his share therein, to
the exclusion of other co-owners.
It is a basic principle in the law of co-ownership that no
individual co-owner can claim any definite portion thereof.
It is not enough that the co-owners agree to subdivide the
property. They must have a subdivision plan drawn in
accordance with which they take actual and exclusive
possession of their respective portions in the plan and titles
issued to each of them accordingly. The mechanics of actual
partition should follow the procedure laid down in Rule 69 of
the Rules of Court. (Del Banco vs. Intermediate Appellate
Court, 156 SCRA 55)
Creditors
Art. 497. The creditors or assignees of the co-owners may
take part in the division of the thing owned in common and
object to its being effected without their concurrence. But
they cannot impugn any partition already executed, unless
there has been fraud, or in case it was made notwithstanding
a formal opposition presented to prevent it, without prejudice
to the right of the debtor or assignor to maintain its validity.
(403)
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Property Law Midterms Reviewer Atty. Donna Z. Gasgonia

Such rights of third persons existing before the division

‣ Creditors are third parties/persons (See Art. 499). was made are retained by them or remain in force
notwithstanding the partition.
‣ When can creditors be include in the partition of the
property in co-ownership? 



Before and during partition (general rule): Creditors cannot Mutual accounting
insist on being recognized by all the co-owners, only by the
Art. 500. Upon partition, there shall be a mutual accounting
debtor.

for benefits received and reimbursements for expenses made.


Likewise, each co-owner shall pay for damages caused by
Exception: Fraud (co-owners will collude among each other
reason of his negligence or fraud. (n)
and will make it appear that the debtor will get an almost
useless portion of the property)
Defects and liability (Hidden defects)
Indivisible thing
Art. 501. Every co-owner shall, after partition, be liable for
Art. 498. Whenever the thing is essentially indivisible and the defects of title and quality of the portion assigned to each of
co-owners cannot agree that it be allotted to one of them who the other co-owners. (n)
shall indemnify the others, it shall be sold and its proceeds
distributed. (404)
Obligations of co-owners upon partition:

1. Mutual accounting for benefits, profits, or income received
When it is made to appear to the commissioners that the for the fruits and other benefits of the thing;

estate, or a portion thereof, can not be divided without great 

inconvenience to the parties interested, the court may order it 2. Mutual reimbursements for expenses (if they share in the
assigned to one of the parties, provided he pays to the other benefits, they should also share in the charges);

party such sum of money as the commissioners judge 

equitable. But if no one of the parties interested will take 3. Indemnity for damages caused by reason of negligence or
such assignment and pay such sum, the court shall order the fraud (for example, in the making of expenses or alterations,
commissioners to sell such estate at public or private sale. for it is logical and just); and

Where the estate can not be divided, the court may direct the 

sale of the property at public or private sale. At this public or 4. Reciprocal warranty for defects of title or quality of the
private sale third parties may become the purchasers. (Garcia portion assigned to a co-owner.
de Lara vs. Gonzalez de Lara, 2 Phil. 294)
Reciprocal warranty
Third persons ‣ A and B, co-owners, partitioned their land. Later, C, a
stranger was able to prove that he really owned the lot
Art. 499. The partition of a thing owned in common shall not
belonging to B. Should B alone bear the loss? 

prejudice third persons, who shall retain the rights of


mortgage, servitude or any other real rights belonging to
NO! Both A and B must bear the loss in that A must give
them before the division was made. Personal rights
half of his portion to B because there is a reciprocal or
pertaining to third persons against the co-ownership shall
mutual warranty against eviction.
also remain in force, notwithstanding the partition. (405)

‣ When is reciprocal warranty prohibited?


‣ Who are “third persons?”
 


 No warranty if there is a contrary stipulation or if the
“Third persons” refer to all those with real rights, such as eviction is due to fault of co-owner evicted. (See Arts.
mortgage and servitude over the thing owned in common 1092-1093). 

or with personal rights against the co-owners who had no
participation whatever in the partition).
 Technical description
There is co-ownership whenever the ownership of an
‣ What are the rights of such third person?
 undivided thing or right belongs to different persons.

 Pursuant to Article 494 of the Civil Code, no co-owner is

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Property Law Midterms Reviewer Atty. Donna Z. Gasgonia

obliged to remain in the co-ownership, and his proper remedy

is an action for partition under Rule 69 of the Rules of Court.

It has been held that the fact that the agreement of partition
lacks the technical description of the parties’ respective
portions or that the subject property was then still embraced
by the same certificate of title could not legally prevent a
partition, where the different portions allotted to each were
determined and became separately identifiable. (Rizal vs.
Naredo, G.R. No. 151898, March 14, 2012, 668 SCRA 114)

How is co-ownership extinguished? (JEPSMLE; Paras, p. 384)

1. Judicial partition
2. Extrajudicial partition
3. When by prescription, one co-owner has acquired the
whole property by adverse possession as against all the
others, and repudiating unequivocally the co-ownership
of the other
4. When a stranger acquires by prescription the thing owned
in common
5. Merger in one co-owner
6. Loss or destruction
7. Expropriation (here the indemnity will be distributed
accordingly). 


DRH Palis DLSU Law | 1st Sem, 2017-2018 34

Property Law Midterms Reviewer
CONDOMINIUM ACT (R.A. 4726)
Stockholder
Purchaser of a condominium unit becomes owner of the unit
only upon full payment of its purchase price.
Ownership of a unit is a condition to become a shareholder in
the condominium corporation. (Sunset View Condominium
Corp. vs. Campos, Jr., No. L-52361, April 27, 1981, 104 SCRA
295)
Common area
The electrical panel’s location inside a condominium unit
notwithstanding, it is not automatically considered as part of
it—the pertinent provisions of the law (Section 6 (a) of
Republic Act No. 4726) and the master deed contemplate
that “common areas,” e.g. utility installations, may be situated
within the unit. Where a statute is clear, plain and free from
ambiguity, it must be given its literal meaning and applied
without attempt to interpret.
In a multi-occupancy dwelling such as Apartments,
limitations are imposed under Republic Act No. 4726 in
accordance with the common interest and safety of the
occupants therein which at times may curtail the exercise of
ownership. A condominium corporation cannot disclaim
responsibility for the maintenance of the Apartments’
electrical supply system solely because a component thereof
is placed inside a unit.
Upon acquisition of a unit, the owner not only affixes his
conformity to the sale; he also binds himself to a contract
with other unit owners. Unquestionably, the fuse box controls
the supply of electricity into the unit. Power is sourced
through jumper cables attached to the main switch which
connects the unit’s electrical line to the Apartment’s common
electrical line. It is an integral component of a power utility
installation. Respondent cannot disclaim responsibility for
the maintenance of the Apartments’ electrical supply system
solely because a component thereof is placed inside a unit.
(Limson vs. Wack Wack Condominium Corporation, G.R. No.
188802, February 14, 2011, 642 SCRA 772)
Non-payment of dues
The Condominium Act provides that the Master Deed may
authorize the condominium corporation to collect “reasonable
assessments to meet authorized expenditures.” For this
purpose, each unit owner “may be assessed separately for its
share of such expenditures in proportion (unless otherwise
provided) to its owner’s fractional interest in the common
areas.” Also, Section 20 of the Condominium Act declares:
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
“Section 20. An assessment upon any condominium made in
accordance with a duly registered declaration of restrictions
shall be an obligation of the owner thereof at the time the
assessment is made. x x x”
In reciprocal obligations, when one party fulfills his
obligation, and the other does not, delay by the other begins.
Moreover, when one party does not comply with his
obligation, the other party does not incur delay if he does not
perform his own reciprocal obligation because of the first
party’s noncompliance.
This is embodied in Article 1169 of the Civil Code, the relevant
provision of which reads:
“In reciprocal obligations, neither party incurs in delay if the
other does not comply or is not ready to comply in a proper
manner with what is incumbent upon him. From the moment
one of the parties fulfills his obligation, delay by the other
begins.”
In this case, petitioner’s denial to ALS of the Condominium
facilities, after ALS had defaulted, does not constitute a valid
ground on the part of ALS to refuse paying its assessments
and dues. (Twin Towers Condominium Corporation vs. Court of
Appeals, G.R. No. 123552, February 27, 2003, 398 SCRA 203)
HLURB
Under PD 957, the mortgage of a subdivision lot or a
condominium unit is void, if executed by a property developer
without the prior written approval of the Housing and Land
Use Regulatory Board (HLURB). That an encumbrance has
been constituted over an entire property, of which the subject
lot or unit is merely a part, does not affect the invalidity of the
lien over the specific portion at issue.
The fact that the lot had no separate TCT did not make it less
of a “subdivision lot” entitled to the protection of PD 957.
That the subject of the mortgage loan was the entire land, not
the individual subdivided lots, does not take the loan beyond
the coverage of Section 18 of PD 957. Undeniably, the lot was
also mortgaged when the entire parcel of land, of which it
was a part, was encumbered.
PD 957 aims to protect innocent lot buyers; The avowed
purpose of PD 957 compels the reading of Section 18 as
prohibitory—acts committed contrary to it are void.
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Property Law Midterms Reviewer
Acts executed against the provisions of mandatory or
prohibitory laws shall be void. (Far East Bank & Trust Co. vs.
Marquez, G.R. No. 147964, January 20, 2004, 420 SCRA 349)
P.D. 957
Section 18 of P.D. No. 957 provides in part: 
 questioned assessments are still material. The validity of


“No mortgage on any unit or lot shall be made by the owner or
developer without prior written approval of the authority (now
the Housing and Land Use Regulatory Board or HLURB).”
The jurisdiction of the HLURB to regulate the real estate trade
is broad enough to include jurisdiction over complaints for
annulment of mortgage. This is pursuant to the intent of P.D.
No. 957 to protect hapless buyers from the unjust practices
of unscrupulous developers which may constitute mortgages
over condominium projects sans the knowledge of the former
and the consent of the HLURB. (Philippine National Bank vs.
Lim, G.R. No. 171677, January 30, 2013, 689 SCRA 523)
Cases and explanations from slides:
Chateau de Baie vs Moreno (G.R. No. 186271, 23 Feb 2011)
Case 1 - Foreclosure based on nonpayment of assessment dues
‣ Moreno as registered owners of a penthouse unit and
two parking lots failed to pay association dues. Chateau
de Baie caused the annotation of a Notice of Assessment
on Moreno’s Certificates of Title for unpaid dues with a
demand letter to pay.
‣ Moreno offered to settle the unpaid dues but Chateau
refused the offer. The property was sold through an
extrajudicial public auction by order of the RTC.
‣ Chateau argued: Sec. 20 of RA 4726, when a unit owner
fails to pay the association dues, the condominium
corporation can enforce a lien on the condominium unit
by selling the unit in an extrajudicial foreclosure sale.
‣ Salvacion, mortgagee argued that Chateau does not have
a special authority from the owner under Act 3135 on
Real Estate Mortgages to initiate a foreclosure
proceeding. He also asked for the lined to be declared as
excessive.
‣ Ruling: Condominium unit foreclosed for nonpayment of
assessment dues.
Case 2 - Asked SEC to order accounting and determine if
association dues were exorbitant
‣ Moreno questioned the validity of association dues as
exorbitant in the HLURB and SEC because it is in intra-
corporate dispute.
‣ Ruling: Act 3135 does not apply. Special law—RA 4726 on
Condominium applies.
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
‣ Since the extrajudicial sale was authorized by the by-laws,
and was the result of the nonpayment of assessments, the
issue is within the exclusive original jurisdiction of the
SEC.
‣ Even if the property case been sold extrajudicially, the
the foreclosure depends on the legality of the assessments
to be determined by the SEC.
‣ The RTC must continue to determine the legality of the
assessments. [RA 8799: SEC jurisdiction on intra-
corporate controversies transferred to the RTC].
Sunset View Condominium Corp. vs Campos (No. L-52361,
April 27, 1981, 104 SCRA 295)
Sec. 4, RA 4726 expressly provides that the shareholding in
the Condominium Corporation will be conveyed in a proper
case and it leaves it to the Master Deed to determine when
the transfer of the shareholding is effected. Sec. 6 of the
Master Deed provides that the unit is acquired by a purchaser
based on the instrument of conveyance.
The assignors have a “Contract to Buy and Sell” which
provides that upon full payment the BUYER of the total
purchase price and full compliance by the BUYER of its
obligations, the SELLER shall convey unto the BUYER “full
and absolute title in and to the subject unit, to the shares of
stock pertaining thereto.”
Sec. 10 of the Condominium Act provides that Membership is
not transferable separate from the condominium unit. When a
member ceases to own a unit he shall automatically cease to
be a a member or stockholder of the corporation.
Ownership of a unit is a condition sine qua non to being a
shareholder.
Without full payment, the assignors are not owners, and
therefore, they are not shareholders. The courts have
jurisdiction because this is a simple action for collection.
Limson vs. Wack Wack Condominium Corporation (G.R. No.
188802, February 14, 2011, 642 SCRA 772)
The fuse box controls the supply of electricity into the unit.
Power is sourced through jumper cables attached to the main
switch which connects the unit’s electrical line to the
common electrical line. It is an integral component thereof
placed inside a unit.
Both the law and the Master Deed refer to utility installations
as part of the the common areas. Repairs to correct any
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Property Law Midterms Reviewer Atty. Donna Z. Gasgonia

defects should be under the control of the condominium

corporation to ensure safety and compliance with the
Philippine Electrical Code, and the security and peace of mind
of unit owners.

Twin Towers Condominium Corporation vs. Court of Appeals

(G.R. No. 123552, February 27, 2003, 398 SCRA 203)

According to the Condominium Act, unit owners shall

automatically be members or shareholders of the
condominium corporation, to the exclusion of others, in
proportion to the appurtenant interest of their respective
units in the common areas. The SEC has jurisdiction. But by
virtue of RA 8799 (August 2000), SEC jurisdiction over intra-
corporate disputes was transferred to the RTC. So case was
remanded to RTC to determine appropriate assessments and
dues to be paid by ALS.

Even if the Master Deed or the By-laws do not authorize Twin

Towers prohibit delinquent unit owners from using facilitiers,
House Rule 26.3 on Assessments is valid because ALS is
bound by the terms and conditions of the Master Deed which
gave Twin Towers the authority to impose penalties and
interests in order to enforce the restrictions - stated in the
House Rules - “Unit owners with delinquent accounts, their
tenants, guests/visitors and relatives shall not be allowed the
use of all facilities of the condominium such as the swimming
pool, gym, social hall, etc.”

ALS is not entitled to damages nor to offset the value of

undelivered services because the injury arose from its own
violation of the contract.

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Property Law Midterms Reviewer
SPECIAL PROPERTIES (Arts. 502-522)
Waters
Art. 502. The following are of public dominion:
(1) Rivers and their natural beds;
(2) Continuous or intermittent waters of springs and brooks
running in their natural beds and the beds themselves;
(3) Waters rising continuously or intermittently on lands of
public dominion;
(4) Lakes and lagoons formed by Nature on public lands, and
their beds;
(5) Rain waters running through ravines or sand beds, which
are also of public dominion;
(6) Subterranean waters on public lands;
(7) Waters found within the zone of operation of public works,
even if constructed by a contractor;
(8) Waters rising continuously or intermittently on lands
belonging to private persons, to the State, to a province, or to
a city or a municipality from the moment they leave such
lands;
(9) The waste waters of fountains, sewers and public
establishments. (407)
Privately owned waters
Art. 503. The following are of private ownership:
(1) Continuous or intermittent waters rising on lands of
private ownership, while running through the same; 

(2) Lakes and lagoons, and their beds, formed by Nature on
such lands;
(3) Subterranean waters found on the same;
(4) Rain waters falling on said lands, as long as they remain
within the boundaries;
(5) The beds of flowing waters, continuous or intermittent,
formed by rain water, and those of brooks, crossing lands
which are not of public dominion.
In every drain or aqueduct, the water, bed, banks and
floodgates shall be considered as an integral part of the land
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
of building for which the waters are intended. The owners of
lands, through which or along the boundaries of which the
aqueduct passes, cannot claim ownership over it, or any right
to the use of its bed or banks, unless the claim is based on
titles of ownership specifying the right or ownership claimed.
(408)
Use of public waters
Art. 504. The use of public waters is acquired:
(1) By administrative concession;
(2) By prescription for ten years.
The extent of the rights and obligations of the use shall be
that established, in the first case, by the terms of the
concession, and, in the second case, by the manner and form
in which the waters have been used. (409a)
‣ Can public waters be acquired by prescription? 

NO! Public waters cannot be acquired by prescription.
What can be acquired by prescription under Art. 504 is
“title” to the use of public waters by continuous enjoyment
thereof for ten years. (NAWASA vs Secretary of Public
Works and Communication, 16 SCRA 536 [1966])
Water concession
Art. 505. Every concession for the use of waters is
understood to be without prejudice to third persons. (410)
Extinguishment
Art. 506. The right to make use of public waters is
extinguished by the lapse of the concession and by non-user
for five years. (411a)
‣ Concession period - 25 years
Use of private water - Spring water
Art. 507. The owner of a piece of land on which a spring or
brook rises, be it continuous or intermittent, may use its
waters while they run through the same, but after the waters
leave the land they shall become public, and their use shall be
governed by the Special Law of Waters of August 3, 1866, and
by the Irrigation Law. (412a)
‣ You cannot acquire waters because they are part of the
public dominion.
38
Property Law Midterms Reviewer
Use of private water - Rainwater
Art. 508. The private ownership of the beds of rain waters
does not give a right to make works or constructions which
may change their course to the damage of third persons, or
whose destruction, by the force of floods, may cause such
damage. (413)
‣ Why is water released from dams during storms or when
the water level in the dam is high and reaches a “critical”
level? 
 they become public, or if they enter a private estate instead,


To prevent damage to the dams!
No entry except mining
Art. 509. No one may enter private property to search waters
or make use of them without permission from the owners,
except as provided by the Mining Law. (414a)
‣ The miners would take precedence.
Lower estates
Art. 510. The ownership which the proprietor of a piece of
land has over the waters rising thereon does not prejudice the
rights which the owners of lower estates may have legally
acquired to the use thereof. (415)
Reservoir
Art. 511. Every owner of a piece of land has the right to
construct within his property, reservoirs for rain waters,
provided he causes no damage to the public or to third
persons. (416)
Subterranean waters
Art. 512. Only the owner of a piece of land, or another person
with his permission, may make explorations thereon for
subterranean waters, except as provided by the Mining Law.
Explorations for subterranean waters on lands of public
dominion may be made only with the permission of the
administrative authorities. (417a)
Rights of private owners of waters (De Leon)
1. To use the waters of a spring or brook which rises on his
land while they run through the same (Art. 507);
2. To make works or constructions on beds or rain waters
owned by him provided they do not change the course of
the waters to the damage of third persons, or whose
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
destruction, by the force of flood, may cause such
damage (Art. 508);
3. To withhold permission to any one to enter his private
property to search waters or make use of them, except
when required by the Mining Law (Art. 509); and
4. To construct on his land reservoirs for rain waters to keep
rain water for his own use provided he causes no damage
to the public or to third persons. (Art. 511)
Under Art. 507. the moment the waters leave a private estate,
they shall belong to the owner of the latter, and so on
successively, where they pass. (Sansano v. Castro, [C.A.] 40
O.G. [11th Supp., No. 15], p. 227.)
Obligations of private owners of waters (De Leon)
1. Not to make works of constructions or works on beds of
rain waters owned by him which may change the course
of the waters to the damage of third persons, or whose
destruction, by the force of floods, may cause such
damage (Art. 508);
2. To permit entry into his private property by bona fide
holders of mining claims to search for waters or make
use of them as provided by the Mining Law (Art. 509);
3. Not to do anything which would prejudice the rights
which owners of lower estates may have legally acquired
to the use of waters rising on his land (Art. 510); and
4. Not to construct within his property reservoirs for rain
waters which will cause damage to the public or to third
persons. (Art. 511).
‣ “Beds” - natural, no construction
Artificial wells, pumps
Art. 513. Waters artificially brought forth in accordance with
the Special Law of Waters of August 3, 1866, belong to the
person who brought them up. (418)
Abandoned to natural course
Art. 514. When the owner of waters artificially brought to the
surface abandons them to their natural course, they shall
become of public dominion. (419)
Defensive works
Art. 515. The owner of a piece of land on which there are
defensive works to check waters, or on which, due to a
change of their course, it may be necessary to reconstruct
such works, shall be obliged, at his election, either to make
the necessary repairs or construction himself, or to permit
39
Property Law Midterms Reviewer Atty. Donna Z. Gasgonia

Trade-marks and trade-names

them to be done, without damage to him, by the owners of the
lands which suffer or are clearly exposed to suffer injury.
(420)
Accumulated matter
Art. 520. A trademark or tradename duly registered in the
proper government bureau or office is owned by and pertains
to the person, corporation, or firm registering the same,
subject to the provisions of special laws. (n)

Art. 516. The provisions of the preceding article are

applicable to the case in which it may be necessary to clear a Art. 521. The goodwill of a business is property, and may be
piece of land of matter, whose accumulation or fall may transferred together with the right to use the name under
obstruct the course of the waters, to the damage or peril of which the business is conducted. (n)
third persons. (421)

Art. 522. Trade-marks and trade-names are governed by

‣ “Matter” - debris
special laws. (n)
Contribution to expenses

Art. 517. All the owners who participate in the benefits

arising from the works referred to in the two preceding
articles, shall be obliged to contribute to the expenses of
construction in proportion to their respective interests. Those
who by their fault may have caused the damage shall be
liable for the expenses. (422)

‣ Dams, dikes - if beneficial, all owners obliged to contribute!

In case of conflict

Art. 518. All matters not expressly determined by the

provisions of this Chapter shall be governed by the special
Law of Waters of August 3, 1866, and by the Irrigation Law.
(425a)

Mining

Art. 519. Mining claims and rights and other matters

concerning minerals and mineral lands are governed by
special laws. (427a)

‣ Special laws - Mining Code, Mining Act

‣ General rule: Mining trumps agricultural use

‣ Exception to the general rule: Mining company did not do

to improve the area; surface rights will be considered.
(Atok Big-Wedge Mining Co. v. IAC and Tuktukan Saingan,
261 SCRA 528)

DRH Palis DLSU Law | 1st Sem, 2017-2018 40

Property Law
THE WATER CODE (P.D. 1067)
National Water Regulatory Board
The lead government agency in charge of implementing the
Water Code of the Philippines, previously attached to the
DPWH, now attached to the Department of Environment and
Natural Resources, with the Secretary of the DENR as its
Chairman by virtue of Executive Order No. 123, dated 12 Sept
2002
What is “waters?”
Article 4. Waters, as used in this Code, refers to water under
the grounds, water above the ground, water in the
atmosphere and the waters of the sea within the territorial
jurisdiction of the Philippines.
Water Code, 31 Dec 1976, whereas clauses
WHEREAS, Article XIV, Section 8 of the New [1973]
Constitution of the Philippines provides, inter alia, that all
waters of the Philippines belong to the State
WHEREAS, existing water legislations are piece-meal and
inadequate to cope with increasing scarcity of water and
changing patterns of water use;
WHEREAS, there is a need for a Water Code based on rational
concepts or integrated and multipurpose management of
water resources and sufficiently flexible to adequately meet
future developments;
WHEREAS, water is vital to national development and it has
become increasingly necessary for government to intervene
actively in improving the management of water resources;
———
Art. XII, Sec. 2, 1987 Constitution. All lands of the public
domain, waters, x x x are owned by the State. With the
exception of agricultural lands, all other natural resources
shall not be alienated. The exploration, development, and
utilization of natural resources shall be under the full control
and supervision of the State. The State may directly
undertake such activities, or it may enter into co-production,
joint venture, or production-sharing agreements with Filipino
citizens, or corporations or associations at least sixty per
centum of whose capital is owned by such citizens. x x x
DRH Palis DLSU Law | 1st Sem, 2017-2018
Midterms Reviewer Atty. Donna Z. Gasgonia
Ownership of waters
Article 3. The underlying principles of this code are:
(a) All waters belong to the State.
(b) All waters that belong to the State can not be the subject
to acquisitive prescription.
(c) The State may allow the use or development of waters by
administrative concession.
(d) The utilization, exploitation, development, conservation
and protection of water resources shall be subject to the
control and regulation of the government through the
National Water Resources Council [Board], hereinafter
referred to as the Council.
(e) Preference in the use and development of waters shall
consider current usages and be responsive to the changing
needs of the country.
The following belong to the State
Article 5. The following belong to the State:
(a) Rivers and their natural beds;
(b) Continuous or intermittent waters of springs and brooks
running in their natural beds and the beds themselves;
(c) Natural lakes and lagoons;
(d) All other categories of surface waters such as water
flowing over lands, water from rainfall whether natural, or
artificial, and water from agriculture runoff, seepage and
drainage;
(e) Atmospheric water;
(f) Subterranean or ground waters; and,
(g) Seawater.
Waters found on private lands belong to the State
Article 6. The following waters found on private lands belong
to the State:
(a) Continuous or intermittent waters rising on such lands;
(b) Lakes and lagoons naturally occuring on such lands;
(c) Rain water falling on such lands;
(d) Subterranean or ground waters; and,
(e) Water in swamps and marshes.
The owner of the land where the water is found may use the
same for domestic purposes without securing a permit,
provided that such use shall be registered, when required by
the Council. The Council, however, may regulate such when
there is wastage, or in times of emergency.
41
Property Law
‣ If there are waters in your property and you want to use it
other than for your family, you need a permit from your
government (NWRB).
Article 7. Subject to the provisions of this Code, any person
who captures or collects water by means of cisterns, tanks, or
pools shall have exclusive control over such water and the
right to dispose of the same.
‣ If for own consumption, no need for permit!
Article 8. Water legally appropriated shall be subject to the
control of the appropriator from the moment it reaches the
appropriator's canal or aqueduct leading to the place where
the water will be used or stored and, thereafter, so long as it is
being beneficially used for the purposes for which it was
appropriated.
‣ You can “open” (divert?) a river into your property.
Water permit
Article 13. Except as otherwise herein provided, no person,
including government instrumentalities or government-owned
or controlled corporations, shall appropriate water without a
water right, which shall be evidenced by a document known
as a water permit.
Water right is the privilege granted by the government to
appropriate and use water.
‣ Can a private individual or private corporation own public
waters? What kind of right can a private individual or
private corporation have over public waters?



NO! Only “title” or a “water right” to the use of public
waters. This right shall be evidence by a water permit. (See
also Art. 504, Civil Code).
Exceptions
Article 14. Subject to the provisions of this Code concerning
the control, protection, conservation, and regulation of the
appropriation and use of waters, any person may appropriate
or use natural bodies of water without securing a water
permit for any of the following:
(a) Appropriation of water by means of hand carried
receptacles; and
DRH Palis DLSU Law | 1st Sem, 2017-2018
Midterms Reviewer Atty. Donna Z. Gasgonia
(b) Bathing or washing, watering or dipping of domestic or
farm animals, and navigation of watercrafts or
transportation of logs and other objects by flotation.
‣ Ducks and carabaos cannot be prevented to enter your
property to use water.
Qualification
Article 15. Only citizens of the Philippines, of legal age, as
well as juridical persons, who are duly qualified by law to
exploit and develop water resources, may apply for water
permits.
Transfer
Article 19. Water rights may be leaded or transferred in whole
or in part to another person with prior approval of the Council,
after due notice and hearing.
Limit of “beneficial use”
Article 20. The measure and limit of appropriation of water
shall be beneficial use.
Beneficial use of water is the utilization of water in the right
amount during the period that the water is needed for
producing the benefits for which the water is appropriated.
Third persons
Article 24. A water right shall be exercised in such a manner
that the rights of third persons or of other appropriators are
not prejudiced thereby.
Easement
Article 25. A holder of water permit may demand the
establishment of easements necessary for the construction
and maintenance of the works and facilities needed for the
beneficial use of the waters to be appropriated subject to the
requirements of just compensation and to the following
conditions:
(a) That he is the owner, lessee, mortgagee or one having real
right over the land upon which he proposes to use water; and
(b) That the proposed easement is the most convenient and
the least onerous to the servient estate.
‣ A water permit holder may demand easement for the
construction and maintenance of works subject to just
compensation - and -
42
Property Law Midterms Reviewer
‣ He is the owner, lessee, mortgagee or one having real right
over the land upon which he proposes the use of water
‣ Proposed easement is the most convenient and least
onerous to the servant state
‣ Parties may modify provided not contrary to law or
prejudicial to third persons
‣ “Easement” - A right in the owner of one parcel of land, by
reason of such ownership, to use the land of another for a
special purpose not inconsistent with a general property in
the owner (Black’s Law Dictionary)
Easement
Article 49. Any person having an easement for an aqueduct
may enter upon the servient land for the purpose of cleaning,
repairing or replacing the aqueduct or the removal of
obstructions therefrom.
Article 50. Lower estates are obliged to receive the waters
which naturally and without the intervention of man flow from
the higher estate, as well as the stone or earth which they
carry with them.
The owner of the lower estate can not construct works which
will impede this natural flow, unless he provides an
alternative method of drainage; neither can the owner of the
higher estate make works which will increase this natural
flow.
Article 51. The banks of rivers and streams and the shores of
the seas and lakes throughout their entire length and within a
zone of three (3) meters in urban areas, twenty (20) meters in
agricultural areas and forty (40) meters in forest areas, along
their margins are subject to the easement of public use in the
interest of recreation, navigation, floatage, fishing and
salvage. No person shall be allowed to stay in this zone
longer than what is necessary for recreation, navigation,
floatage, fishing or salvage or to build structures of any kind.
‣ Forest areas - 40m
‣ Agricultural - 20m
‣ Urban areas - 3m
‣ “Floatage” - flat-bottomed boat able to float on the body of
water
‣ Navigable river - 2.5m depth
‣ Salvage - a boat sinks, retrieve property
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
Water shortage
Article 26. Where water shortage is recurrent, the use of the
water pursuant to a permit may, in the interest of equitable
distribution of the benefits among legal appropriators, be
reduces after due notice and hearing.
Article 27. Water users shall bear the diminution of any water
supply due to natural causes or force majeure.
‣ There was a case decided by the Supreme Court about
this! It was mentioned by Atty. Gasgonia that the SC
decided that Metro Manila had precedence over Central
Luzon considering that the national economy is based in
Metro Manila. (LOL, eh nasa Metro Manila din kasi ang SC!
Bayas mija! LOL)
Suspension
Article 28. Water permits shall continue to be valid as long as
water is beneficially used; however, it maybe suspended on
the grounds of non-compliance with approved plans and
specifications or schedules of water distribution; use of water
for a purpose other than that for which it was granted; non-
payment of water charges; wastage; failure to keep records of
water diversion, when required; and violation of any term or
condition of any permit or rules and regulations promulgated
by the Council.
Temporary permits may be issued for the appropriation and
use of water for short periods under special circumstances.
Revocation
Article 29. Water permits may be revoked after due notice
and hearing on grounds of non-use; gross violation of the
conditions imposed in the permit; unauthorized sale of water;
willful failure or refusal to comply with rules and regulations
of any lawful order; pollution, public nuisance or acts
detrimental to public health and safety; when the
appropriator is found to be disqualified under the law to
exploit and develop natural resources of the Philippines;
when, in the case, of irrigation, the land is converted to non-
agricultural purposes; and other similar grounds.
Utilization of waters
Article 31. Preference in the development of water resources
shall consider security of the State, multiple use, beneficial
effects, adverse effects and costs of development.
43
Property Law Midterms Reviewer
Ground water, surface water
Article 32. The utilization of subterranean or ground water
shall be coordinated with that of surface waters such as
rivers, streams, springs and lakes, so that a superior right in
one not adversely affected by an inferior right in the other.
For this purpose the Council shall promulgate rules and
regulations and declare the existence of control areas for the
coordinated development, protection, and utilization of
subterranean or ground water and surface waters.
Control area is an area of land where subterranean or ground
water and surface water are so interrelated that withdrawal
and use in one similarly affects the other. The boundary of a
control area may be altered from time to time, as
circumstances warrant.
‣ Surface water include those from rivers, streams, springs,
and lakes.
Private canals, reservoirs, aqueducts
Article 33. Water contained in open canals, aqueducts or
reservoirs of private persons may be used by any person for
domestic purpose or for watering plants as long as the water
is withdrawn by manual methods without checking the
stream or damaging the canal, aqueduct or reservoir;
Provided, That this right may be restricted by the owner
should it result in loss or injury to him.
Government approval, except in case of emergency
Article 39. Except in cases of emergency to save life or
property, the construction or repair of the following works
shall be undertaken only after the plans and specifications
therefor, as may be required by the Council, are approved by
the proper government agency; dams for the diversion or
storage of water, structures for the use of water power,
installations for the utilization of subterranean or ground
water and other structures for utilization of water resources.
Hot spring
Article 40. No excavation for the purpose of emission of a hot
spring or for the enlargement of the existing opening thereof
shall be made without prior permit.
Any person or agency who intends to develop a hot spring for
human consumption must first obtain a permit from the
Department of Health.
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
‣ Pansol - hot water from underground, put into pools to be
cooled for domestic use
Flood control
Article 53. To promote the best interest and the coordinated
protection of flood plain lands, the Secretary of Public Works,
Transportation and Communications may declare flood
control areas and promulgate guidelines for governing flood
plain management plans in these areas.
Article 54. In declared flood control areas, rules and
regulations may be promulgated to prohibit or control
activities that may damage or cause deterioration or lakes
and dikes, obstruct the flow of water, change the natural flow
of the river, increase flood losses or aggravate flood
problems.
Article 55. The government may construct necessary flood
control structures in declared flood control areas, and for this
purpose it shall have a legal easement as wide as may be
needed along and adjacent to the river bank and outside of
the bed or channel of the river.
Article 56. River beds, sand bars and tidal flats may not be
cultivated except upon prior permission from the Secretary of
the Department of Public Works, Transportation and
Communication and such permission shall not be granted
where such cultivation obstructs the flow of water or increase
flood levels so as to cause damage to other areas.
Protection of private property
Article 57. Any person may erect levees or revetments to
protect his property from flood, encroachment by the river or
change in the course of the river, provided that such
constructions does not cause damage to the property of
another.
Old and new river beds
Article 58. When a river or stream suddenly changes its
course to traverse private lands, the owners of the affected
lands may not compel the government to restore the river to
its former bed; nor can they restrain the government from
taking steps to revert the river or stream to its former course.
The owners of the land thus affected are not entitled to
compensation for any damage sustained thereby. However,
the former owners of the new bed shall be the owners of the
abandoned bed in proportion to the area lost by each.
44
Property Law Midterms Reviewer Atty. Donna Z. Gasgonia

The owners of the affected lands may undertake to return the of the transfer, alternative schemes for supplying water to the
river or stream to its old bed at their own expense; Provided, receiving basin, and other relevant factors.
That a permit therefor is secured from the Secretary of Public
Works, Transportation and Communication and work
Water Code
pertaining thereto are commenced within two years from the
The findings of fact of the Secretary of Public Works under
change in the course of the river or stream.
Republic Act No. 2056 should be respected in the absence of
illegality, error of law, fraud, or imposition, so long as said
Water impounding findings are supported by substantial evidence submitted to
him.
Article 61. The impounding of water in ponds or reservoirs
may be prohibited by the Council upon consultation with the
The issuance of a Torrens title does not confer title to
Department of Health if it is dangerous to public health, or it
navigable streams within the registered property, nor is it
may order that such pond or reservoir be drained if such is
conclusive on their non-existence, unless the boundaries of
necessary for the protection of public health.
such stream had been expressly delimited in the registration
plan, so that delimitation of their course may be made even
Article 62. Waters of a stream may be stored in a reservoir by
after the decree of registration has become final.
a permittee in such amount as will not prejudice the right of
any permittee downstream. Whoever operates the reservoir
The ownership of a navigable stream or of its bed is not
shall, when required, release water for minimum stream flow.
acquirable by prescription. (Lovina et al, v. Moreno, 9 SCRA
557)

All reservoir operations shall be subject to rules and
regulations issued by the Council or any proper government
Water ditches, jurisdiction
agency.
Although not necessarily determinative of the nature of the
action, it would nevertheless indicate that what the private
Article 63. The operator of a dam for the storage of water
respondent contemplated was an action for damages. It is
may be required to employ an engineer possessing
pointed out, however, that paragraph (a) of the prayer for
qualifications prescribed for the proper operations,
relief seems to convey the impression that the private
maintenance and administration of the dam.
respondent is asking for the right to use the irrigation water
and for the recognition by the petitioner of an easement on
Article 64. The Council shall approve the manner, location,
his land. Would this change the character of Civil Case 70?
depth, and spacing in which borings for subterranean or
We have consistently held that the allegations of fact set
ground water may be made, determine the requirements for
forth in the complaint and not the prayer for relief will
the registration of every boring or alteration to existing
determine the nature of an action
borings as well as other control measures for the exploitation
of subterranean or ground water resources, and in
The pleading shows that Civil Case 70 involves water and
coordination with the Professional Regulation Commission
water rights and is thus a water dispute. The proper authority
prescribe the qualifications of those who would drill such
to try and decide the case is the National Water Resources
borings.
Council pursuant to Article 88 of Presidential Decree 1067
providing as follows:
No person shall drill a well without prior permission from the
Council.
“Art. 88. The Council shall have original jurisdiction over all
disputes relating to appropriation, utilization, exploitation,
River basin development, control, conservation and protection of waters
within the meaning and context of the provision of this Code.”
Article 65. Water from one river basin may be transferred to
another river basin only with approval of the Council. In Petitioner invoked Abe-abe vs. Manta (90 SCRA 526) and
considering any request for such transfer, the Council shall Tanjay Water District vs. Gabaton (172 SCRA 253) where the
take into account the full costs of the transfer, the benefits SC held that jurisdiction pertained to the National Water
that would accrue to the basin of origin without the transfer, Resources Council as the issues involved were the
the benefits would accrue to the receiving basin on account appropriation, utilization and control of water.

DRH Palis DLSU Law | 1st Sem, 2017-2018 45

Property Law Midterms Reviewer Atty. Donna Z. Gasgonia

But these cases have no application to the instant

controversy. It is clear from a reading of the private
respondent's complaint in Civil Case 70 that it is an action for
damages predicated on a quasi-delict.
A quasi-delict has the following elements: a) the damage
suffered by the plaintiff; b) the act or omission of the
defendant supposedly constituting fault or negligence; and c)
the causal connection between the act and the damage
sustained by the plaintiff. (Bulao v. CA, 218 SCRA 321)
Mining
All mineral lands, as part of the country’s natural resources,
belong to the Philippine State. This concept of jura regalia
enshrined in the past and present Philippine constitutions has
not always been the prevailing principle in this jurisdiction;
however, the abundant resources within our coastal frontiers
have in the past filled not just one colonizer’s booty haul.
Indeed, there was a time in our history when the mining laws
prevailing in this jurisdiction were compromising, to say the
least, of the Filipino people’s inherent rights to their natural
wealth.
The Philippine Bill of 1902 contained provisions for, among
many other things, the open and free exploration, occupation
and purchase of mineral deposits and the land where they
may be found.
One of the continuing requirements under the Philippine Bill
of 1902 for the subsistence of the mining claim is
performance of not less than one hundred dollars’ worth of
labor or undertaking of improvements of the same value
every year.
Under the 1935 Constitution, those natural resources, and for
that matter, those mineral lands and minerals with respect to
which there already was “any existing right, grant, lease, or
concession at the time of the inauguration of the Government
established under this Constitution” were then considered
outside the application of the jura regalia doctrine or at least
not unconditionally or totally within the contemplation of said
doctrine.
The filing of affidavits of annual assessment work, which
procedure is not even provided for in the Philippine Bill of
1902, is required only for purposes of proving that there had
actually been work or improvement done but such filing could
not have been intended to replace the actual work
requirement.
Executive Order No. 141 (1968) established the status of
unpatented mining claims which have not complied with the
annual work requirement as having been abandoned and
open for relocation, their declarations of location being
accordingly cancelled.
Unlike the 1935 Constitution, the 1973 Constitution did not
expressly qualify the application of the regalian doctrine as
being subject to any right granted before the effectivity of the
1935 Constitution or the 1973 Constitution for that matter
but the conditional application of the regalian doctrine could
be found in Presidential Decree No. 463 (1974).
Under the Philippine Bill of 1902, the mining claim holder,
upon locating and recording of his claim, has the right to
acquire for himself all mineral deposits found within his claim
to the exclusion of everyone, including the Government.
The Philippine Bill of 1902 did not foreclose a subsequent act
on the part of the State to limit the time within which a patent
must be secured under threat of forfeiture of rights provided
for under the Philippine Bill of 1902.
Rights of a mining claim holder under the Philippine Bill of
1902 were not absolute or in the nature of ownership, and
neither were they intended to be so. (Atok Big-Wedge Mining
Co. v. IAC and Tuktukan Saingan, 261 SCRA 528)

Under the Mining Act, the provisions of the Philippine Bill of

1902 regarding mining claims, insofar as the mining lands
and mining claims acquired before the effectivity of the 1935
Constitution are concerned continued to be in effect, and
annual performance of labor or undertaking of improvements
on the mine remained an annual requirement, non-
compliance with which resulted in the mine becoming again
open to relocation but now subject to the lease provisions of
the Mining Act.

DRH Palis DLSU Law | 1st Sem, 2017-2018 46

Property Law
POSSESSION (Arts. 523-561)
Possession
Art. 523. Possession is the holding of a thing or the
enjoyment of a right. (430a)
Person exercising possession
Art. 524. Possession may be exercised in one's own name or
in that of another. (413a)
Squatters
The right conferred upon a person by an Agreement to Sell
cannot be defeated by another person’s unauthorized
intrusion into the the property in question and subsequent
construction of a house thereon.
Squatters have no possessory rights over the land intruded
upon.
Persons guilty of illegal entry cannot invoke the provisions of
Commonwealth Act No. 539. (Pendot v. CA, 172 SCRA 20)
 question the deed of sale of the properties because the
Forcible entry
In a forcible entry case, the principal issue for resolution is
mere physical or material possession (possession de facto)
and not juridical possession (possession de jure) nor
ownership of the property involved.
The law does not require one in possession of a house to
reside in the house to maintain his possession.
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. (Dela Rosa v. Carlos, 414
SCRA 226)
Two concepts
Art. 525. The possession of things or rights may be had in
one of two concepts: either in the concept of owner, or in that
of the holder of the thing or right to keep or enjoy it, the
ownership pertaining to another person. (432)
Possession in good faith, bad faith
Art. 526. He is deemed a possessor in good faith who is not
aware that there exists in his title or mode of acquisition any
flaw which invalidates it.
DRH Palis DLSU Law | 1st Sem, 2017-2018
Midterms Reviewer Atty. Donna Z. Gasgonia
He is deemed a possessor in bad faith who possesses in any
case contrary to the foregoing.
Mistake upon a doubtful or difficult question of law may be
the basis of good faith. (433a)
Innocent third persons
Fraudulent and forged document of sale may become the root
of a valid title if the certificate of title had already been
transferred from the name of the true owner to the name
indicated in the forger.
Reliance on certificate of title sufficient, even if the sale was
void, as the functionings of the Torrens system of registration
is involved.
Where innocent third persons like mortgagees relying on the
certificate of title acquire rights over the property, their rights
cannot be disregarded.
Failure of petitioners in not promptly bringing a suit to
signature of the vendee was allegedly a forgery, fatal to their
cause. (Duran v. IAC, 138 SCRA 489)
Presumption of good faith
Art. 527. Good faith is always presumed, and upon him who
alleges bad faith on the part of a possessor rests the burden
of proof. (434)
Continuing presumption
Art. 528. Possession acquired in good faith does not lose this
character except in the case and from the moment facts exist
which show that the possessor is not unaware that he
possesses the thing improperly or wrongfully. (435a)
Filing of case
A decedent’s representative is not estopped to question the
validity of his own void deed purporting to convey land and if
this be true of the administrator as to his own acts, a fortiori,
his successor cannot be estopped to question the acts of his
predecessor are not conformable to law.
Actions to declare the inexistence of contracts do not
prescribe, a principle applied even before the effectivity of the
new Civil Code.
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Property Law Midterms Reviewer
Since good faith is always presumed and upon him who
alleges bad faith on the part of the possessor rests the
burden of proof.
If there are no other facts from which the interruption of good
faith may be determined, and an action is filed to recover
possession, good faith ceases from the date of receipt of the
summons to appear at the trial and if such date does not
appear in the record, that of the filing of the answer would
control.
As a possessor in good faith, the City of Dagupan was entitled
to all the fruits of the property and was under no obligation to
pay any rental to the intestate estate of Margarita for the use
thereof. (Maneclang v. Baun, 208 SCRA 179)
Character of possession
Art. 529. It is presumed that possession continues to be
enjoyed in the same character in which it was acquired, until
the contrary is proved. (436)
Object of possession
Art. 530. Only things and rights which are susceptible of
being appropriated may be the object of possession. (437)
‣ What kind of things may be the object of possession?



Only PROPERTY may be the object of possession.
Modes of acquiring possession
Art. 531. Possession is acquired by the material occupation
of a thing or the exercise of a right, or by the fact that it is
subject to the action of our will, or by the proper acts and
legal formalities established for acquiring such right. (438a)
‣ What are the MODES of acquiring POSSESSION?
 demanded in his complaint. The complaint for injunctive relief


1. By material occupation or exercise of a right

2. By subjection of the thing or right to our will
 The writ of preliminary injunction issued by the lower court is
3. By execution of proper acts under legal formalities
Possessor
Art. 532. Possession may be acquired by the same person
who is to enjoy it, by his legal representative, by his agent, or
by any person without any power whatever: but in the last
case, the possession shall not be considered as acquired until
the person in whose name the act of possession was
executed has ratified the same, without prejudice to the
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
juridical consequences of negotiorum gestio in a proper case.
(439a)
Possession by succession
Art. 533. The possession of hereditary property is deemed
transmitted to the heir without interruption and from the
moment of the death of the decedent, in case the inheritance
is accepted.
One who validly renounces an inheritance is deemed never to
have possessed the same. (440)
‣ When does the period of possession begin in case of
succession?



The rights to the succession are transmitted from the
moment of the death of the decedent (Art. 777). From that
moment, each of his heirs becomes the undivided owner of
the whole estate left with respect to that portion which
might be adjudicated to him.

‣ What happens when the heir renounces the inheritance?

If the inheritance is validly renounced, the heir is deemed
never to have possessed the same.
Successor-in-interest, writ of preliminary injunction
Two requisites are necessary if an injunction is to issue,
namely, 1) the existence of the right to be protected, and 2)
that the facts against which the injunction is to be directed
are violative of said right.
In particular, for a writ of preliminary injunction to issue, the
existence of the right and the violation must appear in the
allegation of the complaint. A preliminary injunction is proper
only when the plaintiff appears to be entitled to the relief
must be construed strictly against the pleader.
improper and without basis. It is clear from the complaint
that the first and older possessor of the disputed area is the
petitioner herein. Moreover, his possession is by virtue of an
undisputedly valid lease agreement with the government.
This affords the petitioner preference against any other claim
of right over said land. Conversely, any subsequent claimant
can raise no more than a doubtful claim over the property in
question, which dubious claim militates against the issuance
in his favor of a writ of preliminary injunction. Preliminary
injunction will not issue to protect a right not in esse.
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Property Law Midterms Reviewer
Assuming that respondent’s lease over the area in dispute is
valid his remedy is not to destroy the existing fence of the
petitioner, but to go to court and seek its aid. (Buayan Cattle v.
Quintillan, 128 SCRA 276)
Heirs
It is within the jurisdiction of the probate court to approve the
sale of properties of a deceased person by his prospective
heirs before final adjudication.
Although the Rules of Court do not specifically state that the
sale of an immovable property belonging to an estate of a
decedent, in a special proceeding, should be made with the
approval of the court, this authority is necessarily included in
its capacity as a probate court.
It is settled that court approval is necessary for the validity of
any disposition of the decedent’s estate.
There is no doubt that an heir can sell whatever right, interest
or participation he may have in the property under
administration.
The right of an heir to dispose of the decedent’s property,
even if the same is under administration, is based on the Civil
Code provision stating that the possession of hereditary
property is deemed transmitted to the heir without
interruption and from the moment of the death of the
decedent, in case the inheritance is accepted. Where there
are however, two or more heirs, the whole estate of the
decedent is, before its partition, owned in common by such
heirs.
The law does not prohibit a co-owner from selling, alienating
or mortgaging his ideal share in the property held in common.
(Acebedo v. Abesamis, 217 SCRA 186)
Bad faith of heir
Art. 534. On who succeeds by hereditary title shall not suffer
the consequences of the wrongful possession of the
decedent, if it is not shown that he was aware of the flaws
affecting it; but the effects of possession in good faith shall
not benefit him except from the date of the death of the
decedent. (442)
‣ What happens to the heir who possesses the property in
good faith when his predecessor possessed the property in
bad faith?
 of possession?
If the decedent was in bad faith, the heir shall not suffer
the consequences of the wrongful possession of the latter
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
because bad faith is personal to the decedent and is not
deemed transmitted to the heirs. 



The heir suffers the consequences of such possession in
bad faith only from the moment he becomes aware of the
flaws affecting the decedent’s title (Art. 528).
Minors and incapacitated persons
Art. 535. Minors and incapacitated persons may acquire the
possession of things; but they need the assistance of their
legal representatives in order to exercise the rights which
from the possession arise in their favor. (443)
‣ How can MINORS acquire possession of inherited
property?



Minors and others who cannot enter into a contract may
become donees but acceptance shall be done through their
parents or legal representatives (Art. 741).



Incapacitated persons may acquired property or rights by
prescription either personally or through their parents,
guardian, or legal representatives (Art. 1107). Once
possession of a thing is acquired by such persons, there is
born the right of possession. In the exercise of this right,
they need the assistance of their legal representatives.
Court action
Art. 536. In no case may possession be acquired through
force or intimidation as long as there is a possessor who
objects thereto. He who believes that he has an action or a
right to deprive another of the holding of a thing, must invoke
the aid of the competent court, if the holder should refuse to
deliver the thing. (441a)
‣ What action must a person take if he is deprived of
possession of his property?

If movable property, file an action for REPLEVIN.

If immovable property:

1. Accion interdictal (forcible entry and unlawful detainer)

2. Accion publiciana

3. Accion reivindicatoria

‣ What are the actions PROHIBITED regarding the recovery


Force and intimidation. A person’s arbitrary conduct of
fencing his property under the claim that he owns the
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Property Law Midterms Reviewer Atty. Donna Z. Gasgonia

same brazenly violates the law and circumvents the
procedure which should be obtained before the courts
(Villafuerte v. Court of Appeals, 459 SCRA 58).
 (1) When the creditor is absent or unknown, or does not


If he takes justice into his own hands, he is a mere
intruder; and he can be compelled to return the property in
an action for forcible entry and must suffer the necessary
and natural consequences of his lawlessness (Santiago v.
Cruz, 54 Phil. 640; Padim v. Humphrey, 19 Phil. 254).
 (3) When, without just cause, he refuses to give a receipt;
A party who can prove prior possession, whatever may be
the character of such possession, has the security that
entitles him to recover such possession or to remain on
the property even against the owner himself until he is
lawfully ejected by action publiciana or action
renvindicatoria (German Management Services, Inc. v.
Court of Appeals, 177 SCRA 495; Painaga v. Cortez, 202
SCRA 245).
Acts which do not give rise to possession
Art. 537. Acts merely tolerated, and those executed
clandestinely and without the knowledge of the possessor of
a thing, or by violence, do not affect possession. (444)
‣ What are the actions of an OCCUPANT that do not affect
the right of POSSESSION?



FISTS: Force, intimidation, strategy, threats, stealth
Tolerance
From the absence of proof of any contractual basis for
petitioners’ possession of the subject premises, the only legal
implication is that their possession thereof is by mere
tolerance. In Roxas vs. Court of Appeals, 391 SCRA 351
(2002), the SC ruled: “A person who occupies the land of
another at the latter’s tolerance or permission, without any
contract between them, is necessarily bound by an implied
promise that he will vacate upon demand, failing which, a
summary action for ejectment is the proper remedy against
him.”
Consignation alone shall produce the same effect in the
following cases:
appear at the place of payment; 

(2) When he is incapacitated to receive the payment at the
time it is due; 



(4) When two or more persons claim the same right to collect; 

(5) When the title of the obligation has been lost (1176a)”
(Llobrera v. Fernandez, 488 SCRA 509)
Two different personalities
Art. 538. Possession as a fact cannot be recognized at the
same time in two different personalities except in the cases
of co-possession. Should a question arise regarding the fact
of possession, the present possessor shall be preferred; if
there are two possessors, the one longer in possession; if the
dates of the possession are the same, the one who presents a
title; and if all these conditions are equal, the thing shall be
placed in judicial deposit pending determination of its
possession or ownership through proper proceedings. (445)
‣ Can two different persons have possession of the same
property at the same time?

NO! The law will recognize only one as the actual or real
possessort. Except in cases of co-ownership (Art. 484) and
possession where the property is possessed at the same
time by two persons, one in the concept of OWNER and the
other in the concept of HOLDER (e.g., lessor and lessee,
principal and agent) (Art. 525)
Prior possession
Possession is an indicium of ownership of the thing
possessed and to the possessor goes the presumption that
he holds the thing under a claim of ownership.

Where the possession of the property by certain persons is by Article 433 of the Civil Code provides that “(A)ctual
mere tolerance of the owner, the latter has no obligation to possession under claim of ownership raises a disputable
receive any payment from them. 
 presumption of ownership. The true owner must resort to

 judicial process for the recovery of the property.”
Art. 1256, Civil Code: “If the creditor to whom tender of
payment has been made refuses without just cause to accept Article 531 of the Civil Code provides: “Possession is acquired
it, the debtor shall be released from responsibility by the by the material occupation of a thing or the exercise of a
consignation of the thing or sum due. 
 right, or by the fact that it is subject to the action of our will,
or by the proper acts and legal formalities established for

DRH Palis DLSU Law | 1st Sem, 2017-2018 50

Property Law Midterms Reviewer Atty. Donna Z. Gasgonia

acquiring such right.”
 2. In ejectment (unlawful detainer cases) in the CFI/RTC/CA -

file within 10 days the attorneys are notified by the court of
As we have here conflicting claims of possession by the the perfection of the appeal or if:

parties over the land in controversy and because the fact of 

possession cannot be recognized at the same time in two 2.a. The lessee’s appeal is frivolous or dilatory;

different personalities except in case of co-possession, the 2.b. The lessor’s appeal is prima facie meritorious (Art.
present possessor is to be preferred pursuant to Article 538 1647).
of the Civil Code. (Perez v. Mendoza, 65 SCRA 480)
Purpose of the Writ of Preliminary Mandatory Injunction -
Effects of possession, rights of possessor Sec 1, Rule 58, Rules of Court
‣ For the preservation or protection of the rights and
Art. 539. Every possessor has a right to be respected in his
interests and no other purpose during the pendency of
possession; and should he be disturbed therein he shall be
the action
protected in or restored to said possession by the means
‣ To maintain the status quo
established by the laws and the Rules of Court.
‣ Except when the right is very clear, relative
inconvenience bear strongly in complainant’s favor
A possessor deprived of his possession through forcible entry
‣ To reestablish and maintain a pre-existing relation
may within ten days from the filing of the complaint present a
between the parties, recently and arbitrarily interrupted
motion to secure from the competent court, in the action for
by the defendant, than to establish a new relation
forcible entry, a writ of preliminary mandatory injunction to
(Commissioner of Customs vs. Cloribel, et al., 19 SCRA
restore him in his possession. The court shall decide the
234)
motion within thirty (30) days from the filing thereof. (446a)
Wrongful seizure of land
‣ What is the right of the possessor whose possession is The plaintiff in an action of forcible entry and detainer
disturbed?
 instituted against an intruder who enters upon the land by

 force, intimidation, threat, strategy, or stealth must prove a
Every possessor has a right to be respected in his prior possession in himself. This means that as between the
possession; if disturbed, possessor has a right to be two contending parties the law concedes the right of action
protected in or restored to said possession. “Every to the party whose actual and peaceful possession antedates
possessor” includes all kinds of possession, from that of that of the other; and in order to determine which of the two
an owner to that of a mere holder, except that which had prior possession, it is permissible to look to the situation
constitutes a crime 
 which existed before the first act of spoliation occurred.


1. Lawful possessor can employ self-help (Art. 429) 
 A person who does not have actual possession of real
2. To consolidate title by prescription, the possession must property cannot transfer constructive possession by the
be under claim of ownership, and it must be peaceful, execution and delivery of a public document by which the title
public and uninterrupted. 
 to the land is transferred.
3. Acts of possessory character done by virtue of a license
or mere tolerance by the real owner are not sufficient and In the case at bar, the mere execution and delivery of the deed
will not confer title by prescription or adverse possession. did not constitute a delivery of possession. (Masallo v. Cesar,
‣ Interruption in the possession of the whole or a part of a 39 Phil. 134)

thing possessed in common shall be to the prejudice of all
the possessors. (Art. 543) Prior possession
Possession cannot be acquired through force or violence. To
Writ of Preliminary Mandatory Injunction (Paras, p. 513) all intents and purposes, a possessor, even if physically
ousted, is still deemed the legal possessor. Indeed, anyone
Requisites for the issuance of the writ:
 who can prove prior possession, regardless of its character,

 may recover such possession.
1. In forcible entry cases (in the original court) - file within 10
days from the time the complaint for forcible entry is filed Ownership of immovable property is acquired by ordinary
(not from the time the dispossession took place) (Art. 538)
 prescription through possession for ten years.



DRH Palis DLSU Law | 1st Sem, 2017-2018 51

Property Law
Tax receipts and declarations of ownership for taxation, when
coupled with proof of actual possession of the property, can
be the basis of a claim for ownership through prescription.
Tax declarations and receipts are not conclusive evidence of
ownership. At most, they constitute mere prima facie proof of
ownership or possession of the property for which taxes have
been paid. In the absence of actual public and adverse
possession, the declaration of the land for tax purposes does
not prove ownership.
It is settled that ownership cannot be acquired by mere
occupation. Unless coupled with the element of hostility
toward the true owner, occupation and use, however long, will
not confer title by prescription or adverse possession.
(Cequeña v Bolante, 330 SCRA 216)
Damages
The only form of damages that may be recovered in an action
for forcible entry is the fair rental value or the reasonable
compensation for the use and occupation of the property.
Other damages must be claimed in an ordinary action.
Res judicata may not apply because the court in a forcible
entry case has no jurisdiction over claims for damages other
than the use and occupation of the premises and attorney’s
fees.
Petitioners’ filing of an independent action for damages other
than those sustained as a result of their dispossession or
those caused by the loss of their use and occupation of their
properties could not be considered as splitting of a cause of
action. (CGR Corp v Treyes, 522 SCRA 765)
Possession as basis
Art. 540. Only the possession acquired and enjoyed in the
concept of owner can serve as a title for acquiring dominion.
(447)
‣ What kind of possession is required for it to ripen into
ownership?

Under Art. 540, possession acquired and enjoyed in the
concept of owner may ripen into ownership by means of
prescription. This is so even if the possessor acted in bad
faith.
In concept of owner
Art. 541. A possessor in the concept of owner has in his favor
the legal presumption that he possesses with a just title and
he cannot be obliged to show or prove it. (448a)
DRH Palis DLSU Law | 1st Sem, 2017-2018
Midterms Reviewer Atty. Donna Z. Gasgonia
‣ Can a possessor in peaceful and open occupation of land
be ordered to produce a certificate of title to prove his
ownership of the land?



HELL NO! Art. 541 provides that the possessor presumed
to have a just title and cannot be obliged to show or prove
his title over the land. The reason for this presumption is to
protect the owner of the property from inconvenience;
otherwise, he will always have to carry his titles with him
(LOL HASSLE SA MASEL!!!)
To include movables
Art. 542. The possession of real property presumes that of
the movables therein, so long as it is not shown or proved
that they should be excluded. (449)
‣ Who is the presumed owner of movables found inside the
property of an occupant in peaceful and possession
thereof?
It is natural and normal that the movables which are found in an
immovable belong to the possessor of the latter.
Exclusive possession of previous owner
Art. 543. Each one of the participants of a thing possessed in
common shall be deemed to have exclusively possessed the
part which may be allotted to him upon the division thereof,
for the entire period during which the co-possession lasted.
Interruption in the possession of the whole or a part of a
thing possessed in common shall be to the prejudice of all the
possessors. However, in case of civil interruption, the Rules of
Court shall apply. (450a)
Fruits
Art. 544. A possessor in good faith is entitled to the fruits
received before the possession is legally interrupted.
Natural and industrial fruits are considered received from the
time they are gathered or severed.
Civil fruits are deemed to accrue daily and belong to the
possessor in good faith in that proportion. (451)
Division of fruits
Art. 545. If at the time the good faith ceases, there should be
any natural or industrial fruits, the possessor shall have a
right to a part of the expenses of cultivation, and to a part of
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Property Law
the net harvest, both in proportion to the time of the
possession.
The charges shall be divided on the same basis by the two
possessors.
The owner of the thing may, should he so desire, give the
possessor in good faith the right to finish the cultivation and
gathering of the growing fruits, as an indemnity for his part of
the expenses of cultivation and the net proceeds; the
possessor in good faith who for any reason whatever should
refuse to accept this concession, shall lose the right to be
indemnified in any other manner. (452a)
Expenses
Art. 546. Necessary expenses shall be refunded to every
possessor; but only the possessor in good faith may retain
the thing until he has been reimbursed therefor.


Useful expenses shall be refunded only to the possessor in
good faith with the same right of retention, the person who
has defeated him in the possession having the option of
refunding the amount of the expenses or of paying the
increase in value which the thing may have acquired by
reason thereof. (453a)
Removal of useful improvements
Art. 547. If the useful improvements can be removed without
damage to the principal thing, the possessor in good faith
may remove them, unless the person who recovers the
possession exercises the option under paragraph 2 of the
preceding article. (n)
Expenses for luxury of pleasure
Art. 548. Expenses for pure luxury or mere pleasure shall not
be refunded to the possessor in good faith; but he may
remove the ornaments with which he has embellished the
principal thing if it suffers no injury thereby, and if his
successor in the possession does not prefer to refund the
amount expended. (454)
‣ What is the rule on necessary expenses and useful
expenses?
 Art. 549. The possessor in bad faith shall reimburse the fruits


NECESSARY EXPENSES (Imposed by the thing itself for its
preservation and has no relation to the desire or purpose
of the possessor.) 
 The expenses incurred in improvements for pure luxury or


DRH Palis DLSU Law | 1st Sem, 2017-2018
Midterms Reviewer Atty. Donna Z. Gasgonia
Only the possessor in good faith may retain the thing until
he has been reimbursed therefor. A possessor in bad faith
is entitled to reimbursement for necessary expenses but
without right of retention. 

USEFUL EXPENSES (Incurred to give greater utility or
productivity to the thing, e.g. Wall surrounding an estate,
an irrigation system, planting in an uncultivated land, a
fishpond, an elevator in the building, electric lighting
system) 

They are reimbursed only to the possessor in good faith as
a compensation or reward for him. A possessor in bad faith
cannot recover such expenses.

‣ Can useful be removed when possession is awarded to
another?



If the useful improvements can be removed without
damage to the principal thing, the possessor in good faith
may remove them, unless the person who recovers the
possession refunds the expenses or pays the increase in
value which the thing may have acquired by reason
thereof. Bad faith possessor has no limited right of
removal. 

‣ What about LUXURY ITEMS?

They do not affect the existence or the substance of the
thing itself, but only the comfort, convenience or
enjoyment of the possessor. 



They are not the subject of reimbursement, because the
law does not compensate personal whims or caprices, e.g.
Opening of a garden, placing fountains and statues in it,
adorning the ceilings with paintings, and the walls with
reliefs. 

Bad faith possessor has no right of reimbursement but has
limited right of removal, where owner has the option to buy
removable ornament.
‣ “The lack of title does not necessity mean the lack of right
to possess” (DENR v Yap, Sacay v DENR) - Boracay case!
Possessor in bad faith
received and those which the legitimate possessor could
have received, and shall have a right only to the expenses
mentioned in paragraph 1 of Article 546 and in Article 443.
mere pleasure shall not be refunded to the possessor in bad
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Property Law
faith, but he may remove the objects for which such expenses
have been incurred, provided that the thing suffers no injury
thereby, and that the lawful possessor does not prefer to
retain them by paying the value they may have at the time he
enters into possession. (445a)
Cost of litigation
Art. 550. The costs of litigation over the property shall be
borne by every possessor. (n)
Nature or time
Art. 551. Improvements caused by nature or time shall
always inure to the benefit of the person who has succeeded
in recovering possession. (456)
Loss or destruction
Art. 552. A possessor in good faith shall not be liable for the
deterioration or loss of the thing possessed, except in cases
in which it is proved that he has acted with fraudulent intent
or negligence, after the judicial summons.
A possessor in bad faith shall be liable for deterioration or
loss in every case, even if caused by a fortuitous event.
(457a)
Improvements which ceased to exist
Art. 553. One who recovers possession shall not be obliged to
pay for improvements which have ceased to exist at the time
he takes possession of the thing. (458)
Intervening period
Art. 554. A present possessor who shows his possession at
some previous time, is presumed to have held possession
also during the intermediate period, in the absence of proof to
the contrary. (459)
Modes of losing possession
Art. 555. A possessor may lose his possession: 

(1) By the abandonment of the thing;
(2) By an assignment made to another either by onerous or
gratuitous title;
(3) By the destruction or total loss of the thing, or because it
goes out of commerce;
DRH Palis DLSU Law | 1st Sem, 2017-2018
Midterms Reviewer Atty. Donna Z. Gasgonia


(4) By the possession of another, subject to the provisions of
Article 537, if the new possession has lasted longer than one
year. But the real right of possession is not lost till after the
lapse of ten years. (460a)
‣ How is possession lost? (AADPR)

1. By abandonment

2. By assignment

3. By the destruction, total loss, or withdrawal from
commerce

4. By possession of another for more then one year

5. By recovery by lawful owner or possessor
Res nullius (no owner)

By voluntary abandonment, a thing becomes without an
owner or possessor and is converted into res nullius and may
thus be acquired by a third person by occupation.
Spes recuperandi (hope of recovery) and animus revertendi
(intention to return)
An owner of property cannot be held to have abandoned the
same until at least he has some knowledge of the loss of its
possession or of the thing, and a thing cannot be considered
abandoned unless the spes recuperandi (hope of recovery) is
gone and the animus revertendi (intention to return) is finally
given up.
Accion publiciana
An accion publiciana is for the recovery of the right to possess
and is a plenary action in an ordinary civil proceeding in a
Court of First Instance (now RTC) (Reyes vs. Sta. Maria, No.
L-33213, June 29, 1979)


The remedy of accion publiciana prescribes after the lapse of
ten (10) years. The owner may bring an accion reivindicatoria
to recover possession de sure unless he his barred by
prescription.
Loss of movables
Art. 556. The possession of movables is not deemed lost so
long as they remain under the control of the possessor, even
though for the time being he may not know their
whereabouts. (461)
‣ Example - cattle!
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Property Law Midterms Reviewer
Loss of immovables
Art. 557. The possession of immovables and of real rights is
not deemed lost, or transferred for purposes of prescription
to the prejudice of third persons, except in accordance with
the provisions of the Mortgage Law and the Land Registration
laws. (462a)
Holder
Art. 558. Acts relating to possession, executed or agreed to
by one who possesses a thing belonging to another as a mere
holder to enjoy or keep it, in any character, do not bind or
prejudice the owner, unless he gave said holder express
authority to do such acts, or ratifies them subsequently. (463)
Recovery of lost movable
Art. 559. The possession of movable property acquired in
good faith is equivalent to a title. Nevertheless, one who has
lost any movable or has been unlawfully deprived thereof may
recover it from the person in possession of the same.
If the possessor of a movable lost or which the owner has
been unlawfully deprived, has acquired it in good faith at a
public sale, the owner cannot obtain its return without
reimbursing the price paid therefor. (464a)
Summary of Recovery or Non-Recovery Principle (Paras)
1. Owner MAY RECOVER WITHOUT REIMBURSEMENT:
a)  from possessor in bad faith. 
 thing, or (2) has been unlawfully deprived thereof. In these
b)  from possessor in good faith (if owner had LOST the
property or been unlawfully deprived of it) (the acquisition
being from a private person). (Art. 559). 
 except when the possessor acquired it in a public sale.
2. Owner MAY RECOVER but should REIMBURSE:
if possessor acquired the object in good faith at a PUBLIC
SALE or AUCTION. (Art. 559). [Because the publicity
attendant to a public sale should have been sufficient
warning for the owner to come for- ward and claim the
property. (Manresa).].
3. Owner CANNOT RECOVER, even if he offers to REIMBURSE
(whether or not the owner had lost or been unlawfully
deprived):
a)  if possessor had acquired it in good faith by purchase
from a merchant’s store, or in fairs, or markets in accordance
with the Code of Commerce and special laws. (Art. 1505, Civil
Code, see also Arts. 85, 86, Code of Commerce).
b) if owner “is by his conduct precluded from denying the
seller’s authority to sell.” (ESTOPPEL). (Art. 1505). 
 (466)
c) if possessor had obtained the goods because he was an
DRH Palis DLSU Law | 1st Sem, 2017-2018
Atty. Donna Z. Gasgonia
innocent purchaser for value and holder of a NE- GOTIABLE
document of title to the goods. (See Art. 1518).
Irrevindicability
A person unlawfully deprived of the possession of his
personal property has a better right to the possession thereof
as against a buyer in good faith for value from a seller who
had no title thereto.
Under Article 1506 of the Civil Code, it is essential that the
seller should have a voidable title at least. It is clearly
inapplicable where the seller had no title at all.
Ownership is not transferred by contract merely but by
tradition or delivery. Contracts only constitute titles or rights
to the transfer or acquisition of ownership, while delivery or
tradition is the mode of accomplishing the same.
A contract of sale of personal property does not serve to
transfer ownership where the vendee took possession of the
subject matter thereof by stealing the same while it was in
the custody of the vendor’s agent.
Under Article 559, Civil Code, the rule is to the effect that if
the owner has lost a thing, or if he has been unlawfully
deprived of it, he has a right to recover it, not only from the
finder, thief or robber, but also from third persons who may
have acquired it in good faith from such finder, thief or robber.
The said article establishes two exceptions to the general rule
of irrevindicability, to wit: when the owner (1) has lost the
cases, the possessor cannot retain the thing as against the
owner, who may recover it without paying any indemnity,
Between a common law principle and a statutory provision,
the latter must prevail in this jurisdiction.
(Aznar v. Yapdiangco, 13 SCRA 486)
Wild animals
Art. 560. Wild animals are possessed only while they are
under one's control; domesticated or tamed animals are
considered domestic or tame if they retain the habit of
returning to the premises of the possessor. (465)
Lawful recovery
Art. 561. One who recovers, according to law, possession
unjustly lost, shall be deemed for all purposes which may
redound to his benefit, to have enjoyed it without interruption.
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