CASE STUDY

A Requirement For
REM 111 – Fundamentals of Real Estate Management

Submitted by:
Arceo, Corazon
Dos Santos, Maria Josefita
Espique, Ashren
Lusterio, Erika
Soriben, Chrysller
Vicaldo, Danielle
 FUNDAMENTALS OF PROPERTY OWNERSHIP
TOPIC ESSENTIAL ELEMENTS OF TOPIC
Concept of Property • Property Ownership
Ownership Defined as the independent
right of a person to the
exclusive enjoyment and
control of a property, including
its disposition and recovery.
Actions to Recover Ownership • Accion Interdictal/Ejectment
Defined as a summary action
to recovery physical or
material possession only. It
consists of the summary
actions of Forcible Entry and
Unlawful Detainer.
POINTS OF CASE
Is Relevant Is Not Relevant
• The ownership of the
property is under the
name of the great
grandparents despite the
tax declaration is in the
name of their
grandparents.
• When the management of
the produce and the tax
payments became
irregular after the
grandparents perished,
the subject land started to
have uncontrolled
occupancy on various
area of the property,
especially in the road
frontage areas.
• Accion interdictal can be
implemented to recover
physical possession of the
land because there is
forcible entry on the land.
• An action for unlawful
detainer and forcible entry
must be filed within one
 year from the date
possession is lost (or the
date the unlawful
possession started) The
distinction between
forcible entry and unlawful
detainer is premised on
the nature of the
possession. An action for
forcible entry is proper
when the dispossession
was by means of force,
threat, intimidation,
strategy or stealth. Cases
for ejectment are filed with
the Metropolitan or
Municipal Trial Courts,
and proceedings are
summary in nature.

• Accion Publiciana • There is forcible entry

Defined as an ordinary civil present on the land,
proceeding to recover the therefore Accion
better right of possession, Publiciana is not
except in cases of forcible applicable.
entry and unlawful detainer.
>Must be brought within a
period of 10 years
otherwise the real right to
possess is lost
➢ Issue is possession
de jure
• Accion Reinvidicatoria • As the rightful heir by
➢ Action to recover virtue of succession,
ownership over real accion reinvidicatoria can
property be filed to show dominion
➢ Must be brought in on the land as the owner.
the RTC
➢ It must be brought
within 10 or 30 years
as the case may be
➢ Issue involved is
ownership and for this
purpose, evidence of
title or mode may be
introduced
➢ It is permissible to
file both an action
for ownership and
for detainer over the
same land, and
between the same
parties, because the
issues involved are
different

• Writ of Injunction • The person involved is not

➢ A person deprived of allowed to avail himself
his possession of real this remedy as he is
or personal property deprived of his
is ordinarily not possession.
allowed to avail
himself of this
remedy, the reason
being that the
 defendant in actual
possession is
presumed disputably
to have the better
right

• Replevin An action or • In replevin, two parties

provisional remedy where the have rights to possession
complainant prays for the of property, but one party
recovery of the possession of may have greater rights to
personal property property. In the sample
case, only one party has
the right to ownership.

• Writ of Possession An order • The presence of illegal

issued by a court of law which settlers warrants the case
allows a person or group to to file a writ of
take possession of real possession.
property by forcing the person
or group currently in
possession of the property
out.
Definition of Terms • Unlawful Detainer • There is no signed lease
➢ Action that must be agreement between the
brought when the owner and the
possession by a uncontrolled inhabitants
landlord, vendor, within the area.
vendee or other
person of any land
or building is being
unlawfully withheld
after the expiration or
termination of the
 right to hold
possession, by virtue
of any contract,
express or implied

• Forcible Entry • There is forcible entry

➢ Summary action to present because of
recover material or unlawful detainer
physical possession
of real property when
a person originally
in possession was
deprived thereof by
force, intimidation,
strategy, threat or
stealth
➢ Action must be
brought within 1 year
from the
dispossession
➢ Issue involved is
mere physical
possession or
possession de facto
and not juridical
possession nor
ownership

• Doctrine of Self Help • As the rightful heir, the

➢ The right to counter doctrine of self-help is
force with force applicable to the owner to
➢ Comparable with self- threaten unlawful physical
invasion of the property.
 defense under justifying
circumstances in Criminal
Law
➢ 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.
Limitations of the Owner • Those given by the State or • As the heir of the land,
the laws they are subject to the
limitations stated.
• Those given by the owner
himself • On the other hand, If one
does not own the land he
• Those given by the person possesses, he has limited
who gave the right to its rights. He may be
present owner ejected based on two
types of legal action: (1)
ejectment (i.e., forcible
entry or unlawful detainer)
(accion interdictal); or (2)
accion publiciana (or the
plenary action to recover
the better
Basic Types of Estate • Freehold Estate - an estate in
real property that is of
uncertain duration and has the
right to immediate possession
of the land
• The land is not a non-
freehold estate because it
doesn’t have a limited
duration.

Types of Freehold Estate

a. Fee Simple Absolute- a type of

freehold estate wherein the property
can be inherited for as long an owner
wants to retain it.

b. Life estate - a type of freehold

estate wherein the owner may retain
possession for that person's lifetime,
at which point the estate reverts to
original grantor.

• Non-Freehold Estates - an • The land is not a non-

estate in real property that is freehold estate.
of limited duration and is not
inheritable.

Type of Non-Freehold Estate

a. Tenancy for years - involves a lease

for a specified amount of time that is
specified when the lease is signed.

b. Tenancy from year to year -

involves leases is renewed
 automatically as no parties terminates
it

c. Tenancy at will - a type of tenancy

that is for an unspecified amount of
times and can be ended by either
party at any time.

d. Tenancy at sufferance - a type of

tenancy involves a tenant's wrongful
refusal to leave at the end of a
specified lease period.

Kinds of Ownership • Full Ownership • Full ownership may be

Refers to all the rights of the attained once the titles
owner. are clean and transferred.
This may include the right to
possess, use and enjoy the
property, to the fruits,
accessories, to consume the
thing by its use, dispose or
alienate or vindicate and
recover.

• Naked Ownership • Naked ownership is

Refers to ownership where
the right to use and the fruits
has been denied
possible if there is
presence of usufruct
constituted by law, by the
will of private persons
expressed in acts inter
vivos or in a last will and
testament, and by
prescription.
 • Sole Ownership
Refers to ownership which is
vested to only one person.
• Co-Ownership
Refers to ownership rights to
own a whole property together
with the others and at the
same time owner of an aliquot
part thereof.
Legal Restrictions of • General Limitations imposed
Ownership by the State for its benefit
➢ Police power
➢ Eminent domain
➢ Taxation
• Limitations imposed by law
• Limitations imposed by the
owner himself
• Limitation imposed by the
transferor of the property
• Inherent Limitation
• Sole ownership may be
exercised when there is
clear division of the
properties between the
great grand children and
grand children.
• Co-ownership would exist
when the the real property
are not divided by the
heirs and is just being
shared.
• Right of the State to enact
laws or regulations in
relation to persons and
property as may promote
public health, public
morals, public safety, and
the general welfare and
convenience of the
people. It is also imposed
towards one’s personal
liberty or property to
promote the general
welfare. It may be through
an imposition of restraint
upon liberty or property
for the purpose of
promoting the common
good.
• The government road
rerouting project effected
to split the property and
government can imposed
its power of eminent
domain. With regards to
the lease contract with the
grandchildren in the
erected communication
tower, the general rule of
lease of real property is a
personal right. And lastly,
with regards to the tax
payments, they can ask
for a continuation of
paying taxes and ample
share of produce, if not
they can file a complaint
since there is an
agreement
 • The power of the State to
take private property for
public use upon payment
of just compensation.

• The power of the State to

impose charge or burden
upon persons, property or
property rights, for the use
and support of the
government and to enable
it to discharge its
appropriate functions.

• Such as legal easement,

zoning regulations,
building code, rent
control, urban and
agrarian reform,
subdivision regulations,
escheat

• Such as voluntary
servitudes, mortgages,
pledges, lease and deed
of restrictions.

• Such as donation

• Such as co-ownership
Documents of Ownership • Original copy of the notarized • The Deed of Absolute • Certification of the
Deed of Absolute Sale (DAS), Sale remained in the Philippine Consulate is
plus two photocopies not necessary as there
 name of their great had been no indication
• Owner’s duplicate copy of the grandparents that an SPA was
Transfer Certificate of Title executed abroad
(TCT) or the Condominium • The Tax Declaration is
Certificate of Title (CCT) in under the name of the
case of sale of condominium grandparents
units, plus two photocopies
• It was not stated whether
• Certified True Copies of the there was presence of a
latest Tax Declaration for land will and testament
and improvement of the real
property plus two
photocopies. If the property
sold is a vacant lot or no
improvements have been
made on it, a Sworn
Declaration of No
Improvement by at least one
of the transferees or
Certificate of No Improvement
issued by the city or municipal
assessor

• Tax Identification Numbers

(TIN) of the Owner

Additional requirements (if applicable):

• Special Power of Attorney
(SPA), if the person signing
on the document is not the
owner as appearing on the
TCT or CCT
 • Certification of the Philippine
Consulate if the SPA is
executed abroad

• Location plan or vicinity map if

zonal value cannot readily be
determined from the
documents submitted
Modes of Acquiring Title • Private Grant
Voluntary transfer or
conveyance of privately-
owned property by an owner,
such as sale or donation.
• OCT 1206, Decree
#129475, it is also crucial
to settle the title and tax
declaration and another is
to transfer among heirs.

• Public Grant
Administrative method of
acquiring alienable lands of
public domain for agricultural
purposes through homestead,
settlement, free patent, sales
patent, or other government
awards.
o Homestead Patent
Mode of acquiring alienable
and disposable lands of the
public domain for agricultural
purposes conditioned upon
actual cultivation and
residence; application may be
acquired by an individual who
is: (1) citizen of the Philippines
(2) over the age of 18 years or
head of the family (3) not an
 owner of more than 12
hectares of land.

o Free Patent
Requires cultivation by the
occupant for atleast 30 years
prior to the effectivity of the
amendatory law to the Public
Land Act

o Sales Patent
Disposition lands which are
intended for residential,
commercial, or industrial
purposes is governed by
Public Land Act

• Involuntary Grant
Acquisition of private property
against the consent of the
former owner, such as
foreclosure sale, execution
sale or tax delinquency sale.

• Inheritance
Acquisition of private property
through hereditary
succession, either with a will
or without a will.

• Accretion
 Acquisition of land adjoining
the bank of river, bay or sea
shore due to the gradual
deposit of soil as a result of
the river current

• Prescription
Acquisition of title to property
by actual, open continuous
and uninterrupted possession
in the concept of owner for the
period required by law.

• Reclamation
Filling of submerged land,
subject to existing laws and
regulations

PROPERTY MANAGEMENT OVERVIEW

TOPIC ESSENTIAL ELEMENTS OF POINTS OF CASE

TOPIC Is Relevant Is Not Relevant
What is Professional Property • IT IS A SERVICE THE QUESTION IS IF OUR
Management? PROVIDED BY TOPIC -
COMPANIES OR PROFESSIONAL PROPERTY
INDIVIDUALS WHO MANAGEMENT
HAVE MAJOR IS RELEVANT TO THE CASE
EXPERIENCES STUDY. IT IS NOT.
IN MANAGING THE OWNERS - THE
PROPERTIES. GREAT GRANDPARENTS
DIDN'T HIRE A PPM.
INSTEAD, THEY HIRED A
• IT IS THE OVERSEEING CARETAKER. IT SEEMS THAT
OF RESIDENTIAL, THEY DIDN'T EVEN HAVE A
COMMERCIAL AND/OR WRITTEN CONTRACT, BUT
INDUSTRIAL REAL JUST A VERBAL
ESTATE, INCLUDING AGREEMENT. SADLY THIS
APARTMENTS, IS THE RESULT NOW OF NOT
DETACHED HAVING FORMALIZED THE
HOUSES, AGREEMENT. THERE IS NO
CONDOMINIUM UNITS EVIDENCE OF
AND SHOPPING WHAT THE CARETAKER IS
CENTERS. SAYING, WHICH IS THAT THE
OWNERS ALLOWED THEM
• IT INVOLVES THE TO STAY IN THE PROPERTY.
MANAGING OF WHAT IF THEY BUILT A
PROPERTY THAT STRUCTURE - A HALFWAY
IS OWNED BY ANOTHER HOUSE OR A
PARTY OR ENTITY. TRANSIENT HOUSE AND HAD
HIRED A PPM? ABSENTEE
ACTS ON BEHALF OF OWNERS OF VACANT LOTS,
THE OWNER TO ESPECIALLY THOSE THAT
PRESERVE HAVE AN AREA OF
THE VALUE OF THE OVER 1,000 SQUARE METERS,
PROPERTY WHILE IN THIS CASE THE PROPERTY
GENERATING INCOME IS SO BIG, (IT'S MORE THAN
6 HECTARES), ARE BEST IF
• PROCESS OF ENTERED INTO
MANAGING PROFESSIONAL PROPERTY
RESIDENTIAL, MANAGEMENT TO PREVENT
COMMERCIAL AND OR REPEL SQUATTERS. THE
INDUSTRIAL COST OF REMOVING A SMALL
POSSESSIONS. GROUP OF
SQUATTERS IS WORTH THE
SERVICES OF A PPM, PLUS
• THEY HELP OWNERS THE LEGAL HASSLES.
CREATE BUDGETS. EVERY LANDLORD MUST
DECIDE WHETHER TO
• HAVE A MANAGE THEIR PROPERTY
COMPREHENSIVE OR HIRE A PPM TO DO IT FOR
UNDERSTANDING OF THEM. SO, GOING BACK,
OWNER'S GOALS AND LET'S SAY THAT THEY
EXPECTATIONS. BUILT A RESORT, AND WHEN
THE ORIGINAL
• HAVE FREQUENT OWNERS DIE, THEN THERE
COMMUNICATION WITH WILL STILL BE A SYSTEM IN
OWNER REGARDING PLACE. THE LEGAL HEIRS
IMPORTANT DETAILS. WILL NOT HAVE A HARD TIME,
BECAUSE, FIRST,
THERE WILL NOT BE ANYBODY
SQUATTING IN THE
PROPERTY. AND WHATEVER
INCOME IS GENERATED FROM
THE RESORT,
OR THE TRANSIENT HOUSE,
ALL MONIES WILL BE
GIVEN TO THE RIGHTFUL
HEIRS. THAT IS THE
IMPORTANCE OF THE PPM.
IT IS UNBELIEVABLE HOW THE
CASE HAS BEEN RUNNING
FOR
SO MANY YEARS, HOW
MUCH MONEY HAS BEEN
SPENT ON LEGAL
FEES, MAYBE AND THE
INCONVENIENCES IT HAS
CAUSED THE HEIRS.

What are the basics covered in
Professional Property
Management?
SO MUCH MONEY HAS BEEN
LOST ALREADY.
PPM IS DEFINITELY WORTH
THE
INVESTMENT IN THE LONG
RUN, THAN GETTING
A REGULAR "TAGABANTAY" OR
CARETAKER
OF A VALUABLE PROPERTY.
• RENTAL MANAGEMENT
COMPANIES
• OFFER HIGH-QUALITY
TENANT

• SELECTION SERVICES
7 reasons why you need • INVESTMENT
Professional Property PROPERTY
Management MANAGEMENT
COMPANIES FILL
VACANCIES.

• PROPERTY
MANAGEMENT
EXPERTS
HANDLE ALL TENANT
INTERACTION.

• PROPERTY
MANAGEMENT
EXPERTS
ENSURE COMPLETE
LEGAL COMPLIANCE.
 • PROPERTY MANAGERS
HANDLE ALL
ACCOUNTING
ACTIVITIES.

• REAL ESTATE
MANAGERS OPTIMIZE
TENANT RELATIONS.
Objectives of Professional • RENTAL MANAGEMENT
Property Management COMPANIES

• OFFER HIGH-QUALITY
TENANT

• SELECTION SERVICES
Standard Duties of the • INSPECT THE
Professional Property WELLNESS OF THE
Management • PROPERTY
PERIODICALLY

• COORDINATE WITH
CONTRACTOR IF
REPAIR IS NEEDED

• ATTEND IMPORTANT
HOMEOWNERS
MEETINGS AND VOTE

• KEEP UPDATED OF THE

RULES AND
REGULATIONS OF THE
 HOMEOWNERS
ASSOCIATION

• ENSURE UTILITY BILLS

ARE CURRENT

• COORDINATE THE
PAYING OF REAL
ESTATE PROPERTY
TAX

• REPORT INFORMATION
TO ABSENTEE OWNER

• ACTIVELY &
EFFECTIVELY
MARKETING
PROPERTY

• EXPERTLY
ADVERTISING RENTAL
PROPERTY/IES

• HANDLE THE INTERIOR

& EXTERIOR CLEANING
PLUS MAINTENANCE

• TENANT MOVE-IN

• TENANT MOVE-OUT

• REMODELING IF
NECESSARY
 • COMPLY WITH LOCAL
LANDLORD-TENANT
AND REAL ESTATE
BOARD LAWS

• PREVENTIVE
MAINTENANCE OF
PROPERTY/IES
What are the Basic Areas • TENANT RELATIONS –
Covered In Property Management STRONG
RELATIONSHIPS
HELP TO MINIMIZE
TENANT TURNOVER,
WHICH TRANSLATES
TO A SAVINGS IN
LEASING
COMMISSIONS,
TENANT
IMPROVEMENT COSTS,
AND LOSS OF RENT.

• RENT COLLECTION -
PARAMOUNT TO THE
SUCCESS OF ANY
INCOME PRODUCING
PROPERTY

• OPERATING COSTS -
REDUCE OPERATING
COST TO MAXIMIZE
PROFIT
 • MAINTENANCE STAFF -
TO ACCOMMODATE
MAINTENANCE STAFF
TO PROVIDE BETTER
SERVICE

• ACCOUNTING
SYSTEMS - iMPLEMENT
PROPER
ACCOUNTING
SOFTWARE TO MEET
THE NEEDS

• MARKET KNOWLEDGE -
ACCESS TO ALL
CURRENT MARKET
CONDITIONS, E.G.,
COMPARABLE RENTAL
RATES, LEASE TERMS
• AND CONDITIONS, TO
OBTAIN THE BEST
DEALS IN THE
MARKETPLACE.
Special Duties of Property • DETERMINE RENT
Manager in Case Owner Wants BASED ON FAIR
the Property to Earn from Leasing MARKET VALUE
Operation
• OFFER AND
ADVERTISE THE
PROPERTY FOR LEASE

• NEGOTIATE LEASE
AGREEMENTS
 • KEEP A NEAT RECORD
OF RENT PAYMENT
AND
PROFILE OF REGULAR
OCCUPANTS.

• PROVIDE INSTRUCTION
TO THE TENANT ON
THE PROCEDURE OF
DIRECT DEPOSIT OF
RENT TO A BANK
ACCOUNT.

• COORDINATE THE
EJECTION OF LESSEE
IN CASE OF BREACH
OF CONTRACT

• KEEP THE LESSEE'S

DEPOSITS IN AN
ESCROW ACCOUNT
How much do Property • TYPICAL FEE
Management Charge? AGREEMENT -
BETWEEN 8% - 12%

• VACANT UNIT - 1
MONTH'S RENT

• NEW TENANT
PLACEMENT
 • MAINTENANCE,
REPAIRS, EVICTIONS

• LATE PAYMENTS
Expenses by the Owner or • ALL COSTS OF MAJOR
Landlord REPAIRS (ON THE
NEED BASIS)

• MINOR REPAIRS (ON

THE NEED BASIS)

• REAL PROPERTY
TAXES (EST. OF 0.4%
OF PROPERTY VALUE

• FINES AND PENALTIES

• ASSOCIATION DUES
AND UTILITIES WHEN
PROPERTY IS
UNOCCUPIED (BUT
WILL BE PAID
BY OCCUPANT/TENANT
IN CASE OF LEASE

• PROPERTY
MANAGEMENT FEE

• 12% VAT OF INCOME

FROM RENT OVER
P12800

Summary of Tenants Expenses
• TENANT FINDER'S FEE
(EST. 8% OF RENT)
• SECURITY DEPOSIT
(REFUNDABLE NET OF
ARREARS/DAMAGES)
• MONTHLY RENT
(ALWAYS ADVANCE
PAYMENT)
• UTILITIES (WATER,
ELECTRICITY, CABLE
TV, TELEPHONE, WIFI)
• MONTHLY
HOMEOWNERS
ASSOCIATION DUES
• MINOR SCRATCH
REPAIRS AND
REPLACEMENT
OF LIGHT BULBS