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NAVARRO NOTES ON PROPERTY Part 1

In the Mindanao Bus Company yung transportation buc company case, which I was
referring to a while ago, sabi ng Supreme Court dun, the industry is not carried on in this building
where the repair shop is located. The transportation business is carried on outside not here. So
thats another reason why the court said the repair euipment there should not be considered as
immobili!ed but remained personal property.
Can the parties agree that a certain machinery which has been installed by the owner of
the tenement for an industry or wor"s which will be carried on in that building which tend to
directly meet the needs of the industry or wor"s# Can the owner of that machinery and a creditor
agree to treat this machinery as personal property sub$ect them to a chattel mortgage# Is that
allowable# The answer is yes. In other words, again the principle of estoppel will apply. %lthough
the machinery inside the building were installed by the owner and they tend directly to meet the
needs of an industry or wor" which can be carried on in that building, if the parties agree to treat
the machinery as chattel and enter into a chattel mortgage, neither of them will be permitted to
uestion the &alidity later on of the chattel mortgage on the ground that the sub$ect was actually
real property.
'e(t point. In number ) of %rt. *+,, the law deals with animal houses, pigeon houses, -sh
ponds, and other breeding places of similar nature. In case their owner place them or reser&es
them with the intention to ha&e them permanently attached to the land, the animals in these
places are included. So if there is a pigeon house, permanently attached to the land, the pigeons
in that pigeon house are also considered real property. .f course pigeons sometimes /y around
or in the case of -sh ponds and you happen to bangus in your -sh ponds, the bangus are
considered immo&able real property e&en if they are swimming around. 0or purposes of sale,
howe&er, they should be considered as mo&able property. So if you enter into a contract of sale
of the bangus in your -shpond, thats not a sale of real property. That should be considered of
course as a sale of personal property. .r if you donate the bangus to the certain indi&idual, that
should not be considered a donation of real property but a donation of personal property. If you
will consider it a donation of real property you will need to e(ecute a public document both for
the donation and the acceptance.
0ertili!ers actually used in a piece of land. 1hat about insecticide# Same rule should apply.
Mines, uarries and slag dumps when the matter thereof forms part of the bed and waters
either running or stagnant. The waters referred to here are yung natural waters. So if you ha&e
se&eral drums of water which you "eep in your land because in some areas the water becomes
scarce, the waters in those drums which you ha&e earlier collected cannot be considered as
waters referred to in %rt *+,. 2ung mga waters dito either running or stagnant ay yung mga
waters in ri&ers, la"es, lagoons. 'atural waters.
'umber 3, doc"s and structures which although /oating are intended by their nature and
ob$ect to remain in a -(ed place in a ri&er, la"e or port. % uestion has already been as"ed
regarding this. There was a barge which was at a -(ed place, basta nasa -(ed place e&en if
/oating consider it as real property. 0or e(ample '%P.C.4 and some other pri&ate companies
ha&e these power barges which supply electricity to some island pro&inces. These power barges
are usually doc"ed along a port or a shore and they remain there for a considerable period of
time. They are considered as real property. 2ung /oating restaurant $an sa mei reclamation area.
It is /oating but it remains in -(ed place. That should be considered as real property. But of
course if its actually a boat, ta"es passengers, go on a cruise in Manila Bay while cruising around
Manila Bay dinner is ser&ed, you dont considered that as real property or immo&able property.
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5astly, contracts for public wor"s and ser&itudes and other real rights o&er real property.
So please remember the enumeration of real property under %rt *+,. Then ta"e a loo" at what
are in turn considered as immo&able property under %rt *+) and *+6 of the 'CC. I $ust want to
call your attention.
Certain real property by special pro&ision of law also considered as mo&able property. 7ery
good e(ample are growing crops. 8rowing crops are considered under certain pro&isions of law
as mo&able property under the chattel mortgage law as well as the ci&il code pro&isions on sales
they are considered personal property. Sabi nga eh in the case of growing crops, while they are
still there growing in the soil, sabi ng SC in the case of Sibal &s 7alde!, its a mobili!ation by
anticipation. The law already anticipates there subseuently becoming mo&able. 1hen would
that happen# 1hen they are actually gathered. So e&en before they are gathered there is
mobili!ation by anticipation. Thats why they can be a sub$ect of chattel mortgage.
0orces of nature which are brought under the control of science9 nuclear power, wind
power, electricity, these are considered mo&able property.
Shares of stoc" in any corporation as long as you are tal"ing of shares of stoc" they are
considered personal property regardless of the fact that the corporations in which the shares are
held are real property or e&en if the assets of the corporation consist of real property, the shares
of stoc" in that corporation are considered personal.
The ne(t important classi-cation of course is the classi-cation between property of public
dominion and property of pri&ate ownership. So remember %rt *:;.
1hat are considered property of public dominion# Those intended for public use. Those
intended for public ser&ice or for the de&elopment of national wealth.
Property intended for public use < roads, streets, par"s. % property is considered according
to the court, for public use within the meaning of the ci&il code if it is open indiscriminately to
public. In other words, anyone can go there and use it. 5i"e our streets. It is open to anyone
indiscriminately. Thats property for public use.
Properties of public dominion are sub$ect to certain special rules. 1e ha&e to remember
these. They cannot be the sub$ect matter of contracts. They cannot be sold or leased or sub$ect
of contracts. They cannot be acuired by prescription. They cannot be attached and sold at
public auction to satisfy any $udgment. They cannot be burdened with an easement. They cannot
be e&en registered and titled in your name under the Torrens system. If a title is issued co&ering
a property of public dominion, thats not a &alid title.
The go&ernment has property of two types= Property of public dominion and patrimonial
property. 1ith respect to the patrimonial property, $ust li"e any ordinary and pri&ate property,
that can be the sub$ect of contracts. Property of public dominion as long as it remains such is
sub$ect to special rules we ha&e $ust mentioned < cannot be sub$ect to prescription, not sub$ect
to contracts, etc. Is it possible to con&ert property of public dominion to patrimonial property#
2es possible. >ow can that be done# 1ill the mere fact that the property of public dominion is no
longer actually being used for public use or is no longer actually being de&oted to some public
ser&ice, will that automatically con&ert into patrimonial property# 'o it will not. There must be a
formal declaration in the case of nation go&ernment property by the e(ecuti&e or legislati&e of
such con&ersion otherwise the property remains a property of public dominion. 1ith respect to
property of political subdi&isions, con&ersion must always be authori!ed by law. ?(ample, the
4aponggi Cases in&ol&ing the property of the Philippines located in @apan which was gi&en to us
by way of reparation by the @apanese as part of the reparations agreement. Those properties
were originally intended for the use of our embassy but they were ne&er used for that purpose.
%fter a long period of time there was an attempt to sell these properties. The SC said the mere
fact that these properties in @apan had not been actually used for their original purpose does not
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automatically con&ert these properties into patrimonial property. They remain part of the public
domain and conseuently not a&ailable for pri&ate appropriation or ownership until there is a
formal declaration from the go&ernment to withdraw from being such. %bandonment according
to SC cannot be inferred, it must be de-nite.
.n the part of local go&ernment entities, $ust li"e the state, their properties are subdi&ided
into properties for public use and patrimonial properties. %gain for property to be considered for
public use, it must be open indiscriminately to the public otherwise it cannot be said a property
for public use. In some cases howe&er, the SC in determining the properties of a local
go&ernment unit should be considered as public or patrimonial, the SC opted to apply the special
laws go&erning municipal corporation. Thus in the case of Aamboanga del 'orte &s City of
Aambuanga, the SC said we cannot strictly decide this case on the parameters set by the Ci&il
Code in determining what are public use and patrimonial property. This in&ol&ed the creation of a
new local go&ernment cur&e out of a political unit. In that case and other similar cases in&ol&ing
local go&ernments, the SC instead considered the BS? of the property whether it is for
go&ernmental purposes or not. %s long as the property was used for go&ernmental purposes, it
was considered property for public use or a public property.
Still on this point. %s to the absence of clear e&idence as the source of funds used in
acuiring the property which is currently being held by the local go&ernment unit, the
presumption is that the land came from the State. Salas &s @arencio and some other cases. So if a
local go&ernment unit is currently holding property but there is no clear showing as the funds
used to acuire the property or how the property was acuired, the presumption is that property
or land actually came from the State and the local go&ernment unit is holding it merely in trust
for the State for the bene-t of the inhabitants of that locality. If that is so, those properties
cannot be considered as patrimonial property. They will be considered public property and the
national legislature will be considered to ha&e absolute control o&er these properties. In some
cases decided by the SC, it has been made clear that 58Bs cannot enter into contracts, cannot
e&en &alidly authori!ed by means of an ordinance, the awarding of contracts of certain streets in
fa&our of certain indi&iduals for purposes of ha&ing plea mar"et there. %s long as the street
remains a street, its for public use and therefore beyond the power of 58B to deal with by
means of contract. In one case the 58B authori!ed that a certain street be con&erted a plea
mar"et, there was an ordinance authori!ing that. The SC said that cannot be. 1hat is clear from
this cases is that while e&en under the 58C, 58Bs are allowed to withdraw certain streets when
no longer necessary or withdraw from public use, in other words they cannot ha&e their ca"e and
eat it too. 1ithout actually withdrawing the road from public use, they will still maintain it as a
street and at the same time operate it as a plea mar"et. That cannot be done. Sabi ng SC sa mga
ganitong "aso, >indi pwede yan. %s long as they ha&e not been withdrawn from public use, they
remain property for public use. They cannot at the same time enter into contract with pri&ate
indi&idual who intended to operate a plea mar"et in that road. Cailingan "ung gusto nyo iD
withdraw, iDwithdraw nyo. In other words, that street will cease as a street. .nly after that can
you deal with it as patrimonial property but not while it is still a street.
2ou recall the ruling by the SC in Cha&e! &s P?%. There was this agreement between the
P?% and the %M%4I. %M%4I would reclaim areas of Manila Bay and as payment it will be paid with
reclaimed lands. The SC said, with respect to the reclaimed lands on freedom islands around +,6
hectares, which are co&ered by titles in the name of P?% they are alienable lands of the public
domain. But they may only be leased not sold to public corporations of course they may be sold
to 0ilipino citi!ens. .f course with regards to submerged areas, they are inalienable and outside
the commerce of man. .nly after the P?% has reclaimed them may the go&ernment reclassify
them as alienable and disposable lands I0 '. longer needed for public ser&ice. The transfer of
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the submerged lands to %M%4I is also &oid since the Constitution prohibits alienation of our
natural resources other than the agricultural land of public domains. So remember the important
points of the decision.
.1'?4S>IPE
4emember the traditional attributes of ownership. 8enerally, what are the rights of an
owner# 2ou ha&e the right to use, right to the fruits, the right, yung $us abutendi, that should not
interpreted to mean the right to abuse. There is no such thing. @us abutendi simply means the
right to consume the thing by its use. 4ight to dispose. 4ight to &indicate or reco&er. 2ou also
remember the limitations on the rights of ownership. These are limitations which may either
come from the State in the e(ercise of its inherent powers of 8o&ernment== police power,
eminent domain and ta(ation. .r these may be limitations imposed by speci-c pro&isions of law
li"e the pro&isions on Ci&il Code dealing with easements, legal easements. This maybe limitations
imposed by the person transmitting the property. If I am donating a property to you, I may
impose in the deed of donation certain limitations on your use of the property, for e(ample.
In connection with the rights of ownership, you remember the doctrine of self-help
under Article 42. %n owner or lawful possessor is allowed by law the use of such force as may
be reasonably necessary to repel or pre&ent an actual or threatened unlawful depri&ation or
physical in&asion or usurpation of his property. .nly reasonable force should be used. The
doctrine can only in&o"e at the time when there is an actual or threatened unlawful, physical
in&asion not thereafter. If the property has already been ta"en by the third person, you are not
allowed to use force to get it bac". 2ou must in&o"e the aid of $udicial authorities. .ne of the best
e(amples in connection with the doctrine of selfDhelp is of course the case of !er"an
#ana$e"ent and Ser%ices &nc' >ere was a landowner. >e wanted to de&elop his property and
so he e(ecuted a power of attorney in fa&or of 8erman Management Ser&ices to de&elop that
property. 8erman Management Ser&ices went to the property and disco&ered that certain
indi&iduals are occupying the property. They are culti&ating the property. So 8erman
Management used reasonable force to oust these occupants who are culti&ating portions of that
property. 5ater on they tried to in&o"e the principle of selfDhelp. Court said thats not proper
because it is not disputed that when they tried to enter the property those occupants were
already there. They ha&e been culti&ating the land for some time. % party in peaceable uiet
possession shall not be turned out by a strong hand, &iolence or terror according to the Court.
The doctrine of selfDhelp can only be e(ercised and in&o"ed at the time of actual or threatened
dispossession. 1hen possession has already been lost, the owner must resort to $udicial process
for the reco&ery of his property. >e cannot ta"e the law in his own hands. I thin" we can ta"e a
little o(ygen brea" at this point.
%lright, still on ownership. The owner of the property has the right to enclose his property
with a fence, a wall or any other means. There is this beautiful case in this connection and I
referred to ()stodio %' (A. There was a property owned by a person. There was no fence
around his property so some of his neighbors were passing through his land to reach the public
road. 5ater on, the property owner decided to enclose his property with a fence. Conseuently,
his neighbors could no longer pass through his land. They had to ta"e a long route to reach the
public street. They -led a complaint for damages. The Court said this is a case of damnum
absue in$uria. The property owner was simply e(ercising a right e(plicitly granted to him by law,
the right to enclose his property with a fence. If at the meantime, great incon&enience was
caused to his neighbors who now ta"e a longer route to reach the street, its $ust too bad but
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ob&iously they do not ha&e the legal right to claim damages. Please ta"e note that when the
case was decided, there was no easement yet. 1ala pang easement. It was only after the case
was decided when the Court said that an easement must be created but they need to pay
indemnity. So as long there was no easement yet, you ha&e the perfect right to enclose your
property with a fence. That is &ery clear in %rticle *F; of the Ci&il Code.
% property owner has, of course, the $us utendi. The right to use his property. But the right
to use ones property must be e(ercised in such a way as not to in$ure others. Sic uter et to
utelienum non laedas Gnot sureH. So use your own as not to in$ure others. In one case, there was
two ad$oining properties. The owner of the higher property built thereon certain arti-cial bodies
of water. There were arti-cial la"es, water pots, etc. unfortunately, during an inclement or bad
weather, some of these constructions were washed away and they fell to the ad$oining lower
estate. The lower court dismissed the case. The Supreme Court said the case must be reinstated
applying %rticle *F+ while you ha&e the right to use your property9 you use it in such a way as
not to in$ure others. .b&iously, the Court considered the construction of these arti-cial bodies of
water on the higher estate as something which causes during bad weather some damage or
pre$udice to the ad$oining lower estate.
2ou also ta"e note of the pro&isions of %rticle *F: of the Ci&il Code which is sometimes
referred to as the e"er$enc+ doctrine, e"er$enc+ r)le. If you are the owner of a thing, the
law says you ha&e no right to prohibit the interference of another person with your property as
long as the interference is necessary to pre&ent an imminent danger and as long as the
threatened damage or in$ury is greater, much greater as a matter of fact. The law says much
greater than the damage that would arise to you from the interference with your property. In this
connection, the &iew has been ad&anced to which I agree that negligence on the part of the
person interfering does not preclude resort to the rule under %rticle *F:. If, for e(ample, while I
was using my car another &ehicle owned and dri&en by Mr. I carrined to the street and it was
being dri&en carelessly and slammed to the Meralco post and started to billow with smo"e. It was
ob&iously under -re. Bnder this %rticle, Mr. I although he was negligent in dri&ing his car would
ha&e the right to interfere with my property. If I happened to ha&e a -re e(tinguisher for e(ample
I do not ha&e the right to prohibit the interference with the use of that -re e(tinguisher. >is
negligence does not preclude him from in&o"ing the rule under %rticle *F: of the Ci&il Code.
.b&iously, any possible damage which might cause to me with the use of my -re e(tinguisher is
much less than the damage that would result to the complete burning of his car. So in that case I
submit the reuirements of %rticle *F: would clearly be met.
2ou $ust read %rticles *FF and *F*. %ctual possession under claim of ownership raises
disputable presumption of ownership. The true owner must resort to $udicial process if he wants
to reco&er his property. %nd the reuirement to reco&er property, the property must be identi-ed
and the plaintiJ must rely on the strength of his e&idence and not on the wea"ness of the
defendants claim which is in accord with the rule that he who alleges has the burden of proof.
%rticle *F, is simply a reinstatement of the basic principle in Constitutional 5aw. .ne of
the inherent powers of the State is of course the power of eminent domain. Property can be
ta"en for public use as long as there is payment of $ust compensation.
%rticle *F), on the other hand, is a reinstatement of the rule on police power. .f course,
the moment the State e(ercises its police power then property rights must necessarily yield. If
property is ta"en or damaged or destroyed as a conseuence of the e(ercise of police power, of
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course, there is no right to indemnity. The only indemnity they get, the only possible indemnity
you get is the feeling of satisfaction that somehow you ha&e contributed to the common good.
I call your attention to %rticle *F6 at this point. The owner of property is the owner not
only of its surface but of e&erything under it. If you are the owner of a parcel of land, you own not
only the surface but e&erything under it. .f course, that does not necessarily mean that
pro&ision that e&erything under it is to be ta"en in its literal sense. If there are for e(ample
minerals under your land, ah that does not belong to you. That belongs to our Cabali"at sa
Caunlaran, the State. 4egalian doctrine. The uestion is up to what depth you will be considered
an owner of what is beneath your land# Koes that e(tend up to the middle of the earth# The rule
of thumb is that it e(tends only up to such depth as you can still ma"e use of itEup to such
depth that you can still ma"e use of it. %nd in a case decided by the Supreme Court, it would
seem that it is uite deep, at least from the point of &iew of the Supreme Court. I refer to NP( %'
&.rahi". 0or e(ample, there is a property owner. Bn"nown to him, the 'PC constructed a tunnel
passing beneath his land because, this happened somewhere in Mindanao, the 'PC was drawing
water from %gus 4i&er if I remember correctly. .ne of the big ri&ers there. So the property owner
was not aware that there was a tunnel underneath his land constructed by the 'PC, it was much
later whenE.
>idden Treasures
I thin" you will agree if you ha&e been reading pre&ious bar uestions, paborito ito for one reason
or another.
4emember 'o. +, -rst of all, what is considered as treasures# So the law de-nes that in
%rt. *FL, it is any hidden and un"nown deposit of money, $ewellery or other precious ob$ects, the
lawful ownership of which does not appear. In other words, hindi alam "ung sinong mayDari. If
you see your neighbour one midnight, digging a hole on a parcel of land near your house and
hiding a $ar full of $ewellery, that is not hidden treasure, o"ay# %lam mo "ung sino ang nagbaon.
The lawful ownership must not appear. The law enumerates money, $ewellery, or other precious
ob$ects. It applying the ejusdem generis GMnot sure if proper latin termH rule that should be
limited to things of similar nature. Therefore, again, this does not include mineral deposits, or oil,
hindi pwedeng hidden treasure yan, o"ay. PagDaari yan ng ating "abali"at sa "aunlaran, the
State.
1hat is the rule with respect to hidden treasure# It belongs to the owner of the land,
building or other property in which it is found. If it is found by another person, in other words,
somebody other than the owner of the property and by chance, you ha&e the N D N rule, ,;D,;.
N will belong to the owner, N will belong to the -nder. If howe&er the -nder happens to be a
trespasser, he is not entitled to any share.
The law reuires that the -nding should be by chance. By chance. In other words, this
would usually mean, and I thin" the traditional meaning ascribed to this phrase is that the -nding
was not intended. Totally une(pected, not intended. In other words, the -nder was not loo"ing for
the treasure. Supposing that a man has been gi&en the usufruct of a parcel of land by his friend,
and so he is staying there on that land. %nd then one day, there was an old man who ga&e him
what appeared to be an old map, and the old man told him, that on a part of that property, there
is treasure buried by pirates a long time ago. %nd so this usufructuary belie&ing what was told to
him by the old man, digs at the precise spot indicated in that old map. %nd true enough, he -nds
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hidden treasure. 1ill he be entitled to any share of the treasure# 1ill his -nding be considered as
a -nding by chance# If you go to the traditional &iew as to the meaning of by chance, then it
would seem that he would not fall under that category because he intentionally loo"s for the
treasure. But I thin" this logic and good sense in the &iew ad&anced by others. %ccording to
them, when the law says by chance, that should be interpreted to mean Oby a stro"e of good
fortune.P 5et me put it this way, a lot of people had been engaged all o&er the Philippines for the
search of the soDcalled 2amashita Treasure. ?&en boo"s ha&e been written about the search of
this treasure. % lot of people ha&e engaged in diggings, spent millions e&en to -nance this
e(ca&ations but a lot of them ha&e turned, well, were not able to locate any treasure at all. In
other words, e&en if you loo" for treasure, there is no guarantee, e&en if you are using an old
map, there is no guarantee that you will -nd one. So in that sense, if you do -nd treasure, youre
-nding could be considered as by a stro"e of good fortune. %nd in that sense, it can be
considered as -nding by chance. ."ay.
If the -nder was precisely employed by the owner of the land to loo" for treasure there,
the -nder, I submit will not be entitled to any share under art. *FL. >is remuneration will depend
on his contract or agreement with the land owner. %s to how the treasure will be shared, or as to
his compensation, direct compensation, for the wor" which will be underta"en.
5ets now go to accession, another fa&orite area of course. %ccession. The general rule is
contained in art. **;. If you are the owner of the property, by right of accession, you are also
entitled, you also owned e&erything which is produced by the property or which is incorporated
with that property, or which is attached to that property, either naturally or arti-cially. The owner
has the right by accession to e&erything produced, incorporated or attached to the property.
There are &arious "inds of accession. ."ay. 2ou ha&e accession discreta, the right gi&en to
the owner to e&erything which is produced by the property. This is in turn subdi&ided into the
three types of fruits which can possibly be produced, natural fruits, industrial fruits and ci&il
fruits. 'atural fruits are the spontaneous products of the soil, as well as the young and other
products of animals. So animal manure, thats natural fruits o"ay. Mushrooms, yung mushrooms
which are not culti&ated, which $ust sprout in the -eld, especially after a thunderstorm the
pre&ious e&ening, those of you who come from the pro&inces, usually after a thunderstorm the
pre&ious night, if you wal" early morning, youll be able to -nd mushrooms. But you ha&e to be
careful because some of these are poisonous. So that could be considered as spontaneous
products of the soil.
Industrial fruits, on the other hand, are those which are produced by lands through human
labor and culti&ation, o"ay. If you are tal"ing of mushrooms produced by a farm, they are
cultured, that would be industrial rather than natural fruits.
.f course you ha&e the third type of fruit, ci&il fruits. 4ents, price of leases of lands and
other properties, life annuities and other similar income.
%nd then you ha&e accession continua. 2ou ha&e, this is the right gi&en to the owner to
e&erything which is incorporated or attached to his property, either naturally or arti-cially.
1ith regard to immo&able property, you ha&e accession industrial, sub classi-cation of
accession continua. 2ou ha&e, -rst, with respect to immo&ables, accession industrial which
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co&ers building, planting, sowing, and you ha&e accession natural. 1hat would fall under
accession natural# %llu&ion, a&ulsion, change of ri&er beds, formation of islands.
1ith regard to personal or mo&able property, you ha&e ad$uction or con$uction,
commi(tion or confusion, speci-cation.
%lright, to the owner belongs all of the fruits. Ko not forget, howe&er, the rule under art.
**F, &ery important rule. >e who recei&es the fruits has the obligation to reimburse the e(penses
made by another person in their production, gathering, and preser&ation. Please ta"e note, that
in art. *F*, the law does not distinguish between people or persons in good faith and persons in
bad faith. It applies to e&eryone. 2ou might ha&e been in bad faith, but as long as you ha&e spent
for the production, gathering and preser&ation of the fruits, the owner who is able to get bac"
possession is obligated under art **F to reimburse you in the e(penses you were able to incur to
production, gathering, preser&ation.
Please ta"e note howe&er, another important thing we ha&e to remember in connection
with art **F, that the article would not apply if the fruits ha&e not yet been gathered. So if the
fruits are still ungathered, you dont apply art **F. Conseuently, if you happen to be in bad faith
and you ha&e not yet gathered these fruits, when the lawful owner or possessor reco&ers the
property from you, you dont apply **F. 2ou simply lose all of these ungathered fruits, applying
the rule with respect to possessors in bad faith, as well as planters and sowers in bad faith. >e
who is in bad faith, loses e&erything which he has built, planted, or sown.
%rt. **, tells us when these rules on accession with respect to immo&able property will
apply and when they would not. 1hat do I mean# The law says whate&er is built, planted or sown
on the land of another, underlying that phrase, Oland of another,P together with the
impro&ements and repairs thereon shall belong to the owner of the land. If I build, plant or sow
on my own land, therefore, these rules on accession would -nd no proper application. 2ou apply
these rules if something is built, planted or sown on the land of another. Because if it is the
owner of the land himself who builds, plants, or sows, there is no uestion, he is really the owner
of e&erything, o"ay. %s a matter of fact, there is a presumption under art. **) that e&erything, all
wor"s of sowing or planting, all wor"s, sowing and planting are presumed to ha&e been made by
the owner and at his e(pense. .f course, that is a disputable presumption but that is a
presumption $ust the same.
5ets -rst tac"le the situation contemplated in art. **6. 1hat is the scenario in art. **6#
>ere is a land owner, and he decides to build on his property using the materials of another
person, o"ay so simpleng simple ang situation. I ha&e a parcel of land, I build a house there, or
any other thing, but I used your materials, o"ay. .f course, there are always : possibilities. ?ither
I am in good faith or in bad faith. 1hen would I be in good faith in that situation# If I thought that
I ha&e the right to use those materials. If I thought I owned those materials. I would be in bad
faith if I "new that you were the owner of those materials, and despite of that "nowledge, I still
used them, o"ay.
If I am in good faith, a"ala "o sa"en yung materials na yun, whats my obligation under art.
**6# The law says, I should pay their &alue. I should pay their &alue, that is fair and suare. Can I
be held liable for damages# The answer is no because precisely, I was in good faith. I simply
ha&e to pay the &alue of the materials owned by you.
Page of 18
If I am in bad faith, ah of course, I ha&e to pay the &alue of the materials plus damages.
Kamages would of course be intended to penali!e me for my bad faith.
1hat about you, the owner of the materials# 1hat would be your rights# The law says, you
can remo&e your materials, if it is possible to do so without in$ury to the wor" constructed. If it is
possible to remo&e your materials without in$ury, that means it is not really a case of real
attachment, "asi its possible to remo&e e without in$ury. There is no real case of attachment. %t
any rate, the law says you can remo&e your materials if its possible to do so without in$ury to the
plantings, constructions, or wor"s.
If I was in bad faith howe&er, ah the law says you can remo&e your materials in any case.
%side from your right to reco&er damages. So if I am in good faith, limited right of remo&al from
your part. %lright.
Scenario contemplated by art. **L. >ere, the law contemplates a situation where there is
a land owner and somebody builds, plants, or sows on his property. ."ay. %gain, we ha&e to
determine whether the builder, planter, or sower is in good faith or in bad faith. The land owner
also, because e&en the land owner in that case can be in bad faith. 1hen will the land owner be
in bad faith in that situation# If he "new that somebody was building on his property and he
permitted, he allowed that building to continue. Sige lang, sige lang magtayo "a dyan, tapos "a
after a while a"in yan. Bad faith yun, o"ay. .f course if he was not aware that somebody was
building, sowing, or planting in his property, you would ob&iously be in good faith.
The builder, planter or sower on the other hand, would be in good faith if he is not aware
of any defect or /aw in his title or mode of acuisition. The builder thin"s he owns that land or he
thought he had the legal right to build thereon, he was in good faith. If he was aware that he had
no legal right to build on that property, but he built, planted $ust the same, he would ob&iously be
in bad faith.
1hat would be the respecti&e rights# %ssuming that both parties, land owner and builder,
are in good faith, the rights would be as follows=
The land owner can appropriate what has been built, planted or sown on his land. .f
course, he has to pay proper indemnity to the builder, planter or sower. In the case of building
and planting, the land owner also has the option of selling the land occupied by the building or
planting to the builder or planter. >e cannot howe&er a&ail of that option, yung as" the builder or
planter to buy the land, if the &alue of the land is considerably more than the &alue of the
building or planting. Please ta"e note, the law uses the phrase Oconsiderably more.P If the &alue
of the land and the &alue of the building or planting are more or less the same, or if the
diJerence is the &alue is not too much, then the land owner is not precluded from a&ailing that
option. Casi dapat ang diJerence of &alue, the &alue of the land must be considerably more than
the &alue of the building or planting. In that case, they can simply enter into a lease agreement.
If they cannot agree on the terms of the lease, the court shall -( the terms thereof. %ccording to
art **L.
Please ta"e note that art **L distinguishes between a planter and a sower, o"ay.
.b&iously, parehong nagtatanim yan, o"ay. 1hats the diJerence# 2ou are a sower if what you
Page 10 of 18
actually sow is something not produced fruits for a long period of time. 4ice, for e(ample. Sabi
nung "anta, planting rice is ne&er fun, but actually, pagdating sa **L, it is not planting rice, its
sowing rice, o"ay. .nce you har&est, you ha&e to sow again, sower "a niyan. But if what you
plant is something which will last for years and continues producing fruits year after year, you
are not a sower, you are a planter. >alimbawa nagtanim "a ng punong manga, o"ay, or indian
mango or whate&er, coconut, thats a case of planting because what you planted will last for
years and continue producing fruits year after year, without ha&ing to replant them, alright.
Bananas, if what is in&ol&ed is bananas, are you a planter or a sower# .rdinarily, I would say that
you should merely be considered as a sower, not a planter. Because the ordinary way of getting
the fruits from a banana is by cutting down the trun". Pag bumagsa" na, cha"a mo "u"unin yung
mga bunches of bananas o"ay. %lthough I understand that in some areas of South %merica, yung
mga large banana plantations, hindi daw ganun, they simply get the bunches of bananas and
they are somehow able to produce fruits for uite sometime. ."ay. SoE GF;=+LH
P%4T : GF;=;; < +=;;H
The landowner has the right to appropriate but he must pay the proper indemnity. 1hat is
the indemnity# Supposing that the builder spent P,;;" when he built it. %t that time when the
landowner e(ercises his option to appropriate the building was already worth P, million. 1hat is
the amount which will constitute the proper indemnity# SC has already decided that point. It is
the mar"et &alue at the time when the indemnity is to be paid. So in that problem, although only
P,;;" was spent since the property at the time when indemnity is to be paid the property was
already worth P, million which should be paid by the landowner to the builder.
If the landowner decides to appropriate he has to pay the indemnity and prior to the
payment of the proper indemnity to the builder, the builder has the right of retention. If you are
the landowner and I am the builder were both in good faith. I built on your land a building. 2ou
informed me that your option is to appropriate the building. So the price of indemnity is lets say
is P+; million. Prior of payment of P+; million to me, I ha&e the right to retain the building and to
continue occupying your land. That is the right of retention gi&en by law to me.
1hat is the purpose of the right of retention# To ensure that I will be paid properly the
indemnity due to me. 'ow, supposing during the period of retention while you ha&e not yet paid
me the indemnity naghahanap "a pa ng pera pambayad sa a"in the building is lost because of
caso fortuito. Tinamaan ng "idlat nasunog and it was completely incinerated. 1hats the net
eJect# %h, sorry na lang a"o. I lose my right of retention because you are not obligated as
landowner to pay for buildings or impro&ements which ha&e already ceased to e(ist. 1ala na, no
more right of retention.
'ow during the period of retention can the landowner demand from the builder the
payment of rent# . can you tell me but you ha&e to pay rentE Te"a muna, magbayad "a muna
ng renta dyan sa occupied area ng building mo, eh lupa "o yan. In the meantime, I am depri&ed
of the use of my property. Can I be reuired to pay rent# The answer is '.. %s long as there is a
right of retention brought about by the earlier e(ercise by the landowner of the option to
appropriate. %s long as the builder has the right of retention he cannot be compelled to pay rent.
1hy# Because if he is reuired to pay rent that will damage in$ureQnegate his security for the
payment of the indemnity.
Supposing that the property, the building which I constructed in good faith on your land is
producing fruits. 5ets assume that portions of that building are being leased outQrented out by
Page 11 of 18
me to third persons who are paying me rent. Kuring the period when I ha&e the right of retention,
who is entitled to the rentals paid by the tenants# Can these rentals be oJset with the indemnity
due to me# In one early case, I refer to .rti! &s. Cayanan which in&ol&ed possessor in good faith.
There were some impro&ements for which he was entitled to indemnity. There was a right of
retention because the indemnity has not yet been paid. Kuring the period when he had the right
of retention, nung hindi pa siya nababayaran ng indemnity for some useful impro&ements. %
detour was constructed through the property. Ketour "asi one highway was being constructed or
repaired by the go&ernment. In the meantime, &ehicles had to ta"e a detour through the
property which was under the right of retention and tolls were collected. 5ahat ng &ehicles na
dumadaan doon ay may toll. %ng tanong doon isE Can the tolls collected by the possessor who
had a right of retention, can the tolls he collected be oJsetQcompensated with the indemnity
which is due to him# %ng sabi ng SC sa .rti! &s. Cayanan, 2?S pwede. In other words, the right of
retention according to SC could in that case not merely a security but rather a way for the
e(tinguishment of the obligation to pay indemnity. So pwede raw.
In some other cases decided by SC, Pecson for e(ample of which I am sure you are
familiar. Sabi ng SC hindi pwede. If fruits are collected by the builder in good faith during the
period when he is e(ercising his right of retention, these fruits and rentals cannot be
compensated with the indemnity due him. 1hy# Because he is the one entitled as a
conseuence of a right of retention to the possession and tenancy of the property. >e is also
entitled to these fruits. So there can be no compensation between the fruits and the indemnity
for the simple reason that they are both due to him. They both belong to him.
2ou "now this is admittedly one of the wellE I could sense a certain ambi&alence on the
part of court decisions. Casi one reason according to some decisions the builder in good faith is
no longer entitled to the fruits during the period of retention. Its because you "now under the
law on possession the moment the builder becomes aware that he is not really the owner of the
property, there is some mode, there is a defect in the mode on title or acuisition, then strictly
spea"ing he is no longer in good faith. %nd from that moment on under the law on possession he
is not entitled to the fruits. Thats the basis on SC decisions to the eJect that he is not entitled to
the fruits.
But personally I thin" the better &iew is that he would still be entitled. In other words, as
long as he builds in good faith he cannot be depri&ed of the rights pertaining to a builder in good
faith. .ne of which is the right of retention e&en if considered assumed at some point he
becomes aware there is a defect or /aw in his title or mode of acuisition he continues to
e(ercise the rights of a builder in good faith. .ne of which is the right of retention. %nd the right
of retention I submit necessarily implies tenancy and continued possession as such he should be
entitled to the fruits. %nd there can be no compensation between the fruits and the amount of
indemnity due to him.
The option is gi&en to the landowner and not the builder. It is the landowner who decides
whether he will appropriate what has been built or planted or whether he will as" the builder or
planter to buy the land. That option is gi&en to him. The builder cannot compel the landowner to
simply sell the land to him or at least the portion thereof occupied by his building. >e cannot do
that because the option is not gi&en to him. The option is gi&en by law to the landowner. 1hy# In
Kepra &s. Kumlao, the SC said because the right of the landowner is older.
Page 12 of 18
%lright, can the landowner simply refuse the e(ercise the options under %rt. **L# >e does
not want to appropriate the building. Sabi niya ayaw "o nyang building mo, ano ang gagawin "o
ang pangit yang bahay moE 'either does he want to sell the land occupied by the building.
%yaw "o ding ibenta. In short, he simply tells the builder lumayas "a, tanggalin mo yang building
mo dyan dahil hindi mo lupa yan, lupa "o yan. Can the landowner do that# '., he cannot. >e
cannot $ust refuse to e(ercise this option and simply as" for the remo&al of what in good faith has
been built or planted on his land. The option is limited to those stated in %rt. **L.
But supposing that the landowner a&ails or elects the option of selling his land. Sabi niya,
o sige bilhin mo na lang yan. Ito ang presyo and the &alue of the land lets assume is not
considerably more than that of the building. The builder howe&er is unable to pay. 1ala "ahit
sunugin mo yung builder eh wala "ang maaamoy na pera. 1ala siyang pera pambayad duon sa
land. Sabi ng SC, if that is the case then the landowner can as" for the remo&al of the building if
ha&ing opted to sell his land and assuming the &alue is not considerably more than that of the
building. The builder is unable to pay then thats the situation when the landowner can actually
as" for the remo&al of the building.
%ny other remedies a&ailable to the landowner if that were the case# 2ung builder is
unable to pay. .f course there is always the remedy of simply entering into a lease. They can
simply enter into a lease. Sabi niya, o sige hindi mo pala "aya bayaran eh magDlease na lang
tayo. %nd there is a third remedy. So they can enter into a lease. 'o. :, the landowner can as" for
remo&al. 'o. F option, they can as" for the sale of both the land and the building. The proceeds
of the sale will be -rst applied to the &alue of the land. The rest and any e(cess will be deli&ered
to the owner of the house or the building.
Prior to the time that the landowner e(ercises his option of either appropriation or sale.
Prior to his moment of decision, the builder of course ha&e been occupying the land of the
landowner. Can he be reuired to pay rent for his occupancy during that period prior to the
e(ercise by the landowner of his option# The answer is 2?S. >e should be. The moment the
landowner e(ercises the option to appropriate there arises the right of retention. .n the part of
the builder from that moment he cannot be compelled to pay rent.
If the landowner opts instead of appropriation, ang option nya is sale of the land to the
builder. Can rent be demanded in the meantime# The answer is 2?S. 4ent will ha&e to be paid
until such time when the land is in fact acuired by the builder. Pag na acuire na nya yun, of
course, he is the owner already he simply does not ha&e to pay rent anymore.
'e(t point, we said earlier that these rules in accession on immo&able property would not
apply to a situation where it is the landowner himself who builds or plants on his own property.
Casi sabi natin under the law, planted, built or sown on the land of another. Cung sarili mong
lupa, no application ito. 'ow, ha&ing said that it follows therefore that if a coDowner of a property
builds or plants on the property under coDownership these rules would not apply. It is because a
coDowner is the owner of an ideal or aliuot share of the whole property. %nd as a matter of fact
under the law on coDownership, a coDowner has the right to use the property under coDownership
as long as he does not pre&ent the other coDowners from similarly using it. So if something is
built or planted by a coDowner this rules on accession would not apply.
>owe&er, if the coDownership has already been terminated by a partition of the property
and after the partition it is disco&ered one of the coDowners, the pre&ious coDowners has built on
Page 13 of 18
a part of the property which was later on ad$udicated to another coDowner then the rules under
%rt. **L should apply. The coDowner who had earlier built on the property under coDownership
but a portion of whose building is disco&ered to ha&e encroached upon the part ad$udicated in
the partition to the other coDowners will ha&e the rights of a builder in good faith. Cung
terminated na ang coDownership at naDdis"ubre naE >alimbawa, we are the two coDowners
during the e(istence of a coDownership o&er a parcel of land. I built on that land. 5ater on, we
agree to partition the property. Tapos na ang coDownership. Pag"aDpartition natin naDdis"ubre na
ang building "o pala a few suare meters of my building occupying a part allotted to you under
our partition agreement. %rt **L can be applied. I will be considered a builder in good faith with
the same rights under %rt. **L.
The claim of good faith may be made by a successorDinDinterest of the original builder. In
one case, a certain land together with the building standing thereon was purchased by a buyer.
5ater on, upon resur&ey of the land it was disco&ered that a portion of that building encroached
upon the ad$acent property. Sabi ng SC, 2?S the buyer in this case can in&o"e good faith and the
pro&isions of %rt. **L can apply.
1ell, sometimes to a certain e(tent its uite amusing to remember some of the cases
in&ol&ed. In one case can you imagine there was a couple who bought a lot from a subdi&ision.
Bsually ang mga subdi&ision lot numbers so and soE bloc" numbers so and soE The time -nally
came when they decided to construct a house. So, punta sila sa subdi&ision. Tinanong nila yung
representati&e of the di&isionQde&eloper. Sabi nila, we are going to construct na. Saan ba yung
lote na nabili namin. Sabi ng rep., o eto ho at itinuro ang lote. .", so they constructed. %na" ng
to"wa, hindi pala yun ang lote. 'ag"amali ng turo. Can they in&o"e the rights of a builder in good
faith# 2?S, they can in&o"e the rights of a builder in good faith.
By the way, e&en if the property in&ol&ed is a registered property. >alimbawa, mag"atabi
yung lote natin parehong may titulo. .f course when property is titled &ery precise and
description nyan at ng boundaries. Beginning at the point mar" one on plan. :;;; meters from
so and soE GBasta preciseEHCan you still claim good faith if the properties are co&ered by a
torrens title# The answer is 2?S. Because if you are an ordinary person you are not e(pected
unless you happen to be an e(pert in the science of sur&eyingE 2ou are not e(pected to "now
the precise boundaries of your properties e&en if your property is co&ered by a torrens title. Cung
sur&eyor "a yan o" yan. Pero tayong ordinary person, ano ang malay natin "ung nasaan yang
north 6; degrees na yan. %lthough of course meron na ngayong 8PS. ?&en sa cellphone meron
yan eh. Sasabihin sayo "ung nasaang lugar "a. %ccurate ang description within , meters. May
8PS na na"alagay sa "otse at nagsasalita. Turn right after +;; meters. But e&en then, I submit
that the rule still applies unless you happen to be an e(pert in the science of sur&eying. 2ou
should not be held accountable for a mista"e. 2ou can in&o"e good faith.
Pero ibang usapan naman "ung halimbawa, I build on a land in Manila. 'a"ita "o ang
isang ba"anteng lote at nagtayo a"o duon. 'uong sinita a"o ng mayDari sabi "o ay ganun ba.
Pasensya a"ala "o lote "o ito. ? wala naman a"ong titulo mas"i ano. %ng pagDaari "o ay nasa
Rue!on City. 1ala a"ong properties sa Manila. Can I claim good faith# '.. I should not be allowed
to claim good faith. My mere assertion that I thought I had the legal right to be on that property
ob&iously is a &agrant assertion. 1hy &agrant# Because it has no &isible means of support. .",
so hindi pwedeng &agrant assertion.
'e(t point, supposing that the builder is in bad faith. 1hen a builder is in bad faith
napa"asimple. >e loses e&erything. >e becomes liable for damages. If you build in bad faith you
lose e&erything. The landowner can demand that you buy his land regardless of its &alue. 'o
restrictions needed. Basta in bad faith "a at sinabi "ong bilhin mo ang lupa "o dapat bilhin mo
yun. If your building is worth P+ million yung land na tinayuan mo is worth P, million. 2ou can be
Page 14 of 18
compelled to buy the land. Bad faith "a. Pasaway "a. Casalanan mo and so you are liable for
damages. The landowner would ha&e the right to demand remo&al. Tanggalin mo yan at lumayas
"a sa lupa "o. Basta in bad faith you ha&e no rights whatsoe&er e(cept yung reco&ery of
e(penses for the preser&ation of the property. 1hy so# Casi pagdating sa necessary e(penses
since these are supposedly incurred for the preser&ation of the property the landowner would
ha&e incurred the same e(penses e&en if he was the one in possession of the property. So in
terms of fairness and basic $ustice the law mandates that the builder in bad faith should be
entitled to this.
By the way, sabi natin e&erything produced all fruits of the property belong to the owner.
Siguraduhin lang natin na talagang fruits. There is an old case yung B.'BS. Certain landowners
were as"ed by a certain company. Pwede ba sabi nila iDmortgage nyo yang mga lupa ninyo para
ma"a secure "ami ng loan. 0or the ris" you are going to ta"e we will gi&e you certain bonuses. So
pumayag ang landowners and binigyan sila ng bonuses. %re this bonuses fruits# The answer is
'.. Because they were not produced by the land. >indi yan fruits. They are not e&en ci&il fruits.
Bigla "o lang naisip baga maitanong.
P%4T + < ;+=;;=;; < ;+=+;=;F
'e(t point. Supposing that both the land owner and the land builder are in bad faith. %h
madali yan, they are both considered to ha&e acted in good faith so you apply the pro&isions of
%rticle **L.
Supposing that the builder used the materials of a third person in building on the land of
another, o"ay, a lot will depend on whether the builder and the land owner are in bad faith.
%ssuming that they are both in good faith, both the builder and the land owner are in good
faith and the material owner is also in good faith, ano ang magiging rights ng owner ng
materials# The owner of the materials of course can reco&er the &alue of his materials from the
builder who used it but the land owner can be held subsidiarily liable for the &alue of the
materials in case the builder is unable to pay the owner of the materials their &alue. If howe&er
the builder is in bad faith and conseuently the land owner demands the remo&al or the
demolition of the building remember that the landowner would ha&e no subsidiary liability o"ay
ano reason# In accession he who bene-ts from the accession must pay for it. Thats one
underlying principle. Cung sino na"inabang sa accession dapat magbayad. Thats the reason why
that if the landowner decides to appropriate the building, there is subsidiary liability on his part
in case the builder is insol&ent.
If the land owner howe&er decides to as" for the remo&al, destruction of the building he
does not bene-t from that accession and therefore thats the reason why there would be no
subsidiary liability on the part of the landowner. ."ay which is also the reason what if the
property is sold ha if the property is sold by the land owner pending payment of indemnity to the
builder o"ay ang tanong is who will pay the indemnity to the builder# It depends, if in the
contract of sale between the landowner and the third person, the landowner was already paid
not $ust the &alue of the land but the &alue of the building as well then ob&iously the ah, the
landowner must pay, must pay the &alue of the building, the proper indemnity to the builder. If
on the other hand the landowner was not paid the &alue of the building then he does not bene-t
from the building it would then be the buyer who will bene-t from the accession it would be the
buyer who will ha&e to pay the builder of the proper indemnity. I repeat, he who bene-ts from an
accession must be the one who pay for it. ."ay. %lright.
Page 1* of 18
5ets now go to the matter of allu&ion. 1e ha&e the pro&isions of %rticle *,6. If you are the
owner of a parcel land ad$oining the ban" of a ri&er and due to the natural action of the water
o&er a period of time deposit of ri&er, deposits of ri&er silt are left there by the water such that
the area of your land gradually increased year after year you are the owner of that additional
area. 2our ownership is automatic. The additional area bought about by the allu&ion
automatically belongs to the landowner of that land ad$oining the ban"s of a ri&er. It is not
howe&er, I am referring to the additional area, it is not howe&er automatically registered or
co&ered or protected by the Torrens title of the landowner, he has to register it in his name. %nd
if prior to his registration of that additional area a third person succeeds in occupying that area
claiming it as his own satis-es the reuisite for acuisiti&e prescription, tapos, that third person
would ha&e acuired ownership of that area. ."ay, so I repeat ha if you are the owner of a
property ad$oining the ban"s of a ri&er in the course of many years due to the gradual deposits of
the ri&er silt luma"i ng luma"i yung area mo automatically ha as long as e&erything happens
naturally, hindi "a nagconstruct ng catchment basin or whate&er there, no human inter&ention
you are automatically the owner of the additional area through allu&ion but that additional area
is not automatically co&ered by your Torrens title. Cung may Torrens title "a dun sa property mo,
your Torrens title will not automatically e(tend to the additional area. Therefore the additional
area can still be acuired by a third person through acuisiti&e prescription.
The increase in the area must be e(clusi&ely be due to nature there must be absolutely be
no human inter&ention otherwise thats not allu&ion. In so far as areas bordering la"e are
concerned li"e 5aguna de Bay, 5aguna de bay is not a bay it is a la"e. ."ay. 5a"es are large
bodies of water which usually ha&e a connection with the ri&er, yan ang la"e. 1hat about the
areas there if there are additional areas brought by the action of the water or whate&er to who
this additional areas belong# They would belong to the owners of the ad$acent lands applying the
Spanish 5aw of 1aters.
If you own a parcel of land ah lets say in 5a Bnion and through the action of the sea your
land gradually increased in the area nasa sa may tabing dagat. 1ho would own the additional
area# %h "abali"at sa "aunlaran wag natin pa"ilalaman yan that belongs to the State. Itong
allu&ion ha applicable lang sa ri&ers o"ay hindi "asama dito ang mga shores of the seas pero
applying the Spanish law of waters if what is in&ol&ed is a la"e li"e 5aguna de Bay or la"e 5anao
for that matter the additional area will also belong to the owner of the ad$acent land because sila
mayDari nung property. ."ay. %lright.
In the Mindanao Bus Company yung transportation bus company case, which I was
referring to a while ago, sabi ng Supreme Court dun, the industry is not carried on in this building
where the repair shop is located. The transportation business is carried on outside not here. So
thats another reason why the court said the repair euipment there should not be considered as
immobili!ed but remained personal property.
Can the parties agree that a certain machinery which has been installed by the owner of
the tenement for an industry or wor"s which will be carried on in that building which tend to
directly meet the needs of the industry or wor"s# Can the owner of that machinery and a creditor
agree to treat this machinery as personal property sub$ect them to a chattel mortgage# Is that
allowable# The answer is yes. In other words, again the principle of estoppel will apply. %lthough
the machinery inside the building were installed by the owner and they tend directly to meet the
needs of an industry or wor" which can be carried on in that building, if the parties agree to treat
the machinery as chattel and enter into a chattel mortgage, neither of them will be permitted to
Page 1- of 18
uestion the &alidity later on of the chattel mortgage on the ground that the sub$ect was actually
real property.
'e(t point. In number ) of %rt. *+,, the law deals with animal houses, pigeon houses, -sh
ponds, and other breeding places of similar nature. In case their owner place them or reser&es
them with the intention to ha&e them permanently attached to the land, the animals in these
places are included. So if there is a pigeon house, permanently attached to the land, the pigeons
in that pigeon house are also considered real property. .f course pigeons sometimes /y around
or in the case of -sh ponds and you happen to bangus in your -sh ponds, the bangus are
considered immo&able real property e&en if they are swimming around. 0or purposes of sale,
howe&er, they should be considered as mo&able property. So if you enter into a contract of sale
of the bangus in your -shpond, thats not a sale of real property. That should be considered of
course as a sale of natural property. .r if you donate the bangus to the certain indi&idual, that
should not be considered a donation of real property but a donation of personal property. If you
will consider it a donation of real property you will need to e(ecute a public document both for
the donation and the acceptance.
0ertili!ers actually used in a piece of land. 1hat about insecticide# Same rule should apply.
Mines, uarries and slag dumps when the matter thereof forms part of the bed and waters
either running or stagnant. The waters referred to here are yung natural waters. So if you ha&e
se&eral drums of water which you "eep in your land because in some areas the water becomes
scarce, the waters in those drums which you ha&e earlier collected cannot be considered as
waters referred to in %rt *+,. 2ung mga waters ditto either running or stagnant ay yung mga
waters in ri&ers, la"es, lagoons. 'atural waters.
'umber 3, doc"s and structures which although /oating are intended by their nature and
ob$ect to remain in a -(ed place in a ri&er, la"e or port. % uestion has already been as"ed
regarding this. There was a barge which was at a -(ed place, basta nasa -(ed place e&en if
/oating consider it as real property. 0or e(ample '%P.C.4 and some other pri&ate companies
ha&e these power barges which supply electricity to some island pro&inces. These power barges
are usually doc"ed along a port or a shore and they remain there for a considerable period of
time. They are considered as real property. 2ung /oating restaurant $an sa mei reclamation area.
It is /oating but it remains in -(ed place. That should be considered as real property. But of
course if its actually a boat, ta"es passengers, go on a cruise in Manila Bay while cruising around
Manila Bay dinner is ser&ed, you dont considered that as real property or immo&able property.
5astly, contracts for public wor"s and ser&itudes and other real rights o&er real property.
So please remember the enumeration of real property under %rt *+,. Then ta"e a loo" at what
are in turn considered as immo&able property under %rt *+) and *+6 of the 'CC. I $ust want to
call your attention.
Certain real property by special pro&ision of law also considered as mo&able property. 7ery
good e(ample are growing crops. 8rowing crops are considered under certain pro&isions of law
as mo&able property under the chattel mortgage law as well as the ci&il code pro&isions on sales
they are considered personal property. Sabi nga eh in the case of growing crops, while they are
still there growing in the soil, sabi ng SC in the case of Sibal &s 7alde!, its a mobili!ation by
anticipation. The law already anticipates there subseuently becoming mo&able. 1hen would
that happen# 1hen they are actually gathered. So e&en before they are gathered there is
mobili!ation by anticipation. Thats why they can be a sub$ect of chattel mortgage.
0orces of nature which are brought under the control of science9 nuclear power, wind
power, electricity, these are considered mo&able property.
Page 1/ of 18
Shares of stoc" in any corporation as long as you are tal"ing of shares of stoc" they are
considered real property regardless of the fact that the corporations in which the shares are held
are real property or e&en if the assets of the corporation consist of real property, the shares of
stoc" in that corporation are considered personal.
The ne(t important classi-cation of course is the classi-cation between property of public
dominion and property of pri&ate ownership. So remember %rt *:;.
1hat are considered property of public dominion# Those intended for public use. Those
intended for public ser&ice or for the de&elopment of national wealth.
Property intended for public use < roads, streets, par"s. % property is considered according
to the court, for public use within the meaning of the ci&il code if it is open indiscriminately to
public. In other words, anyone can go there and use it. 5i"e our streets. It is open to anyone
indiscriminately. Thats property for public use.
Properties of public dominion are sub$ect to certain special rules. 1e ha&e to remember
these. They cannot be the sub$ect matter of contracts. They cannot be sold or leased or sub$ect
of contracts. They cannot be acuired by prescription. They cannot be attached and sold at
public auction to satisfy any $udgment. They cannot be burdened with an easement. They cannot
be e&en registered and titled in your name under the Torrens system. If a title is issued co&ering
a property of public dominion, thats not a &alid title.
The go&ernment has property of two types= Property of public dominion and patrimonial
property. 1ith respect to the patrimonial property, $ust li"e any ordinary and pri&ate property,
that can be the sub$ect of contracts. Property of public dominion as long as it remains such is
sub$ect to special rules we ha&e $ust mentioned < cannot be sub$ect to prescription, not sub$ect
to contracts, etc. Is it possible to con&ert property of public dominion to patrimonial property#
2es possible. >ow can that be done# 1ill the mere fact that the property of public dominion is no
longer actually being used for public use or is no longer actually being de&oted to some public
ser&ice, will that automatically con&ert into patrimonial property# 'o it will not. There must be a
formal declaration in the case of nation go&ernment property by the e(ecuti&e or legislati&e of
such con&ersion otherwise the property remains a property of public dominion. 1ith respect to
property of political subdi&isions, con&ersion must always be authori!ed by law. ?(ample, the
4aponggi Cases in&ol&ing the property of the Philippines located in @apan which was gi&en to us
by way of reparation by the @apanese as part of the reparations agreement. Those properties
were originally intended for the use of our embassy but they were ne&er used for that purpose.
%fter a long period of time there was an attempt to sell these properties. The SC said the mere
fact that these properties in @apan had not been actually used for their original purpose does not
automatically con&ert these properties into patrimonial property. They remain part of the public
domain and conseuently not a&ailable for pri&ate appropriation or ownership until there is a
formal declaration from the go&ernment to withdraw from being such. %bandonment according
to SC cannot be inferred, it must be de-nite.
.n the part of local go&ernment entities, $ust li"e the state, their properties are subdi&ided
into properties for public use and patrimonial properties. %gain for property to be considered for
public use, it must be open indiscriminately to the public otherwise it cannot be said a property
for public use. In some cases howe&er, the SC in determining the properties of a local
go&ernment unit should be considered as public or patrimonial, the SC opted to apply the special
laws go&erning municipal corporation. Thus in the case of Aamboanga del 'orte &s City of
Aambuanga, the SC said we cannot strictly decide this case on the parameters set by the Ci&il
Code in determining what are public use and patrimonial property. This in&ol&ed the creation of a
new local go&ernment cur&e out of a political unit. In that case and other similar cases in&ol&ing
local go&ernments, the SC instead considered the BS? of the property whether it is for
Page 18 of 18
go&ernmental purposes or not. %s long as the property was used for go&ernmental purposes, it
was considered property for public use or a public property.
Still on this point. %s to the absence of clear e&idence as the source of funds used in
acuiring the property which is currently being held by the local go&ernment unit, the
presumption is that the land came from the State. Salas &s @arencio and some other cases. So if a
local go&ernment unit is currently holding property but there is no clear showing as the funds
used to acuire the property or how the property was acuired, the presumption is that property
or land actually came from the State and the local go&ernment unit is holding it merely in trust
for the State for the bene-t of the inhabitants of that locality. If that is so, those properties
cannot be considered as patrimonial property. They will be considered public property and the
national legislature will be considered to ha&e absolute control o&er these properties. In some
cases decided by the SC, it has been made clear that 58Bs cannot enter into contracts, cannot
e&en &alidly authori!ed by means of an ordinance, the awarding of contracts of certain streets in
fa&our of certain indi&iduals for purposes of ha&ing plea mar"et there. %s long as the street
remains a street, its for public use and therefore beyond the power of 58B to deal with by
means of contract. In one case the 58B authori!ed that a certain street be con&erted a plea
mar"et, there was an ordinance authori!ing that. The SC said that cannot be. 1hat is clear from
this cases is that while e&en under the 58C, 58Bs are allowed to withdraw certain streets when
no longer necessary or withdraw from public use, in other words they cannot ha&e their ca"e and
eat it too. 1ithout actually withdrawing the road from public use, they will still maintain it as a
street and at the same time operate it as a plea mar"et. That cannot be done. Sabi ng SC sa mga
ganitong "aso, >indi pwede yan. %s long as they ha&e not been withdrawn from public use, they
remain property for public use. They cannot at the same time enter into contract with pri&ate
indi&idual who intended to operate a plea mar"et in that road. Cailingan "ung gusto nyo iD
withdraw, iDwithdraw nyo. In other words, that street will cease as a street. .nly after that can
you deal with it as patrimonial property but not while it is still a street.
2ou recall the ruling by the SC in Cha&e! &s P?%. There was this agreement between the
P?% and the %M%4I. %M%4I would reclaim areas of Manila Bay and as payment it will be paid with
reclaimed lands. The SC said, with respect to the reclaimed lands on freedom islands around +,6
hectares, which are co&ered by titles in the name of P?% they are alienable lands of the public
domain. But they may only be leased not sold to public corporations of course they may be sold
to 0ilipino citi!ens. .f course with regards to submerged areas, they are inalienable and outside
the commerce of man. .nly after the P?% has reclaimed them may the go&ernment reclassify
them as alienable and disposable lands I0 '. longer needed for public ser&ice. The transfer of
the submerged lands to %M%4I is also &oid since the Constitution prohibits alienation of our
natural resources other than the agricultural land of public domains. So remember the important
points of the decision.