Property: Immovable and Movable Case Doctrines

I. IMMOVABLE PROPERTY
REAL PROPERTY UNDER PAR NO. 1; LANDS, BUILDINGS, ROADS AND
CONSTRUCTIONS OF ALL KINDS ADHERING TO THE SOIL
A BUILDING IS ALWAYS IMMOVABLE
Lopez v. Orosa
Building is separate and distinct from land
While it is true that generally, real estate connotes the land and the building
constructed thereon, it is obvious that the inclusion of the building, separate and
distinct from the land, in the enumeration of what may constitute real properties
could mean only one thing that a building is by itself an immovable property (cf.
Leung Yee v. Strong Machinery). In the absence of any specific provision of law to
the contrary, a building is an immovable property, irrespective of whether or not
said structure and the land on which it is adhered to belong to the same owner.
Prudential Bank v. Panis
Building separate and distinct from the land
In the enumeration of properties under Article 415 of the Civil Code of the
Philippines, it is obvious that the inclusion of 'building' separate and distinct from
the land, in said provision of law can only mean that a building is by itself an
immovable property.
Leung Yee v. Strong Machinery
Building separate from land does not affect character as real property; Registry of
chattel mortgage does not affect character of the building and the machineries
installed therein
The Chattel Mortgage Law contemplates and makes provision for mortgages of
personal property; and the sole purpose and object of the chattel mortgage registry
is to provide for the registry of "Chattel mortgages," mortgages of personal property
executed in the manner and form prescribed in the statute. The building of strong
materials in which the machinery was installed was real property, and the mere fact
that the parties seem to have dealt with it separate and apart from the land on
which it stood in no wise changed its character as real property. It follows that
neither the original registry in the chattel mortgage registry of the instrument
purporting to be a chattel mortgage of the building and the machinery installed
therein, nor the annotation in that registry of the sale of the mortgaged property,
had any effect whatever so far as the building was concerned.

BUILDING IS IMMOVABLE BY INCORPORATION

Bicerra v. Teneza

House is immovable property even if situated on land belonging to a different

owner; Exception, when demolished
A house is classified as immovable property by reason of its adherence to the soil
on which it is built (Article 415, paragraph 1, Civil Code). This classification holds
true regardless of the fact that the house may be situated on land belonging to a
different owner. But once the house is demolished, as in this case, it ceases to exist
as such and hence its character as an immovable likewise ceases.

BUILDING ON RENTED LAND IS STILL IMMOVABLE

Evangelista v. Alto Surety

House is not personal, but immovable property
The house is not personal property, much less a debt, credit or other personal
property not capable of manual delivery, but immovable property. As explicitly held,
in Laddera vs. Hodges (48 OG 5374), "a true building (not merely superimposed on
the soil) is immovable or real property, whether it is erected by the owner of the
land or by a usufructuary or lessee. This is the doctrine in Leung Yee vs. Strong
Machinery Company, 37 Phil., 644. The opinion that the house of Rivera should have
been attached in accordance with subsection (c) of said section 7, as "personal
property capable of manual delivery, by taking and safely keeping in his custody",
for it declared that "Evangelista could not have validly purchased Ricardo Rivera's
house from the sheriff as the latter was not in possession thereof at the time he sold
it at a public auction is untenable.

House may be considered personal property in a deed of chattel mortgage, but view
is limited to parties
Parties to a deed of chattel mortgage may agree to consider a house as personal
property for purposes of said contract (Luna vs. Encarnacion, 48 OOG 2664;
Standard Oil Co. of New York vs. Jaramillo, 44 Phil., 630; De Jesus vs. Juan Dee Co.,
Inc., 72 Phil., 464). However, this view is good only insofar as the contracting parties
are concerned. It is based, partly, upon the principle of estoppel. Neither this
principle, nor said view, is applicable to strangers to said contract.

INSTANCES WHERE BUILDING IS TREATED AS PERSONAL BY THE PARTIES

GENERAL TEST, OF MOVABLE CHARACTER

Stadard Oil v. Jamarillo

Jaramillo, register of deeds, does not have judicial or quasi-judicial power to

determine nature of document registered as chattel mortgage
Section 198 of the Administrative Code, originally of Section 15 of the Chattel
Mortgage Law (Act 1508 as amended by Act 2496), does not confer upon the
register of deeds any authority whatever in respect to the "qualification," as the
term is used in Spanish law, of chattel mortgages. His duties in respect to such
instruments are ministerial only. The efficacy of the act of recording a chattel
mortgage consists in the fact that it operates as constructive notice of the existence
of the contract, and the legal effects of the contract must be discovered in the
instrument 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 notice. Thus, it is duty for the register of deed to accept the proper fee
and place the instrument on record, as his duties in respect to the registration of
chattel mortgages are of a purely ministerial character; and no provision of law can
be cited which confers upon him any judicial or quasi-judicial power to determine
the nature of any document of which registration is sought as a chattel mortgage.
It may be noted that in an administrative ruling by James Ostrand, Judge of the
fourth branch of CFI Manila (9th Judicial District) and later Supreme Court Justice,
provided the same position that the Register of Deeds has no authority to pass upon
the capacity of the parties to a chattel mortgage which is presented to him for
record. The issue where the chattel mortgage is held ineffective against third parties
as the mortgaged property is real instead of personal is a question determine by the
courts of justice and mot by the register of deeds.

Issue whether interest is in nature of real property not relevant to the issue of
placing the document on record in Chattel Mortgage
In Leung Yee vs. Frank L. Strong Machinery, the Supreme Court held that where the
interest conveyed is of the nature of real property, the placing of the document on
record in the chattel mortgage register is a futile act. That decision is not decisive of
the question before the Supreme Court, which has reference to the function of the
register of deeds in placing the document on record.

CONSTRUCTION OF ALL KINDS ADHERED TO THE SOIL

Board of Assessment Appeals v. City Treasurer

Steel towers are not immovable property under paragraph 1, 3 and 5

The steel towers or supports do not come within the objects mentioned in
paragraph 1, because they do not constitute buildings or constructions adhered to
the soil. They are not constructions analogous to buildings nor adhering to the soil.
As per description, given by the lower court, they are removable and merely
attached to a square metal frame by means of bolts, which when unscrewed could
easily be dismantled and moved from place to place.
They can not be included under paragraph 3, as they are not attached to an
immovable in a fixed manner, and they can be separated without breaking the
material or causing deterioration upon the object to which they are attached. Each
of these steel towers or supports consists of steel bars or metal strips, joined
together by means of bolts, which can be disassembled by unscrewing the bolts and
reassembled by screwing the same.
These steel towers or supports do not also fall under paragraph 5, for they are not
machineries or receptacles, instruments or implements, and even if they were, they
are not intended for industry or works on the land. Petitioner is not engaged in an
industry or works on the land in which the steel supports or towers are constructed.

REAL PROPERTY UNDER NO. 2: TREES, PLANTS AND GROWING FRUITS.

TREES AND PLANTS

Sibal v. Valdez

Paragraph 2, Article 334 of the Civil Code interpreted by the Tribunal Supremo de
Espana as that growing crops may be considered as personal property
Sugar cane may come under the classification of real property as "ungathered
products" in paragraph 2 of article 334 of the Civil Code, which enumerates as real
property as "Trees, plants, and ungathered products, while they are annexed to the
land or form an integral part of any immovable property." That article, however, has
received in recent years an interpretation by the Tribunal Supremo de Espaa,
which holds that, under certain conditions, growing crops may be considered as
personal property. (Decision of March 18, 1904, vol. 97, Civil Jurisprudence of
Spain.) Thus, under Spanish authorities, pending fruits and ungathered products
may be sold and transferred as personal property. Also, the Supreme Court of Spain,
in a case of ejectment of a lessee of an agricultural land, held that the lessee was
entitled to gather the Products corresponding to the agricultural year because said
fruits did not go with the land but belonged separately to the lessee. And further,
under the Spanish Mortgage Law of 1909, as amended, the mortgage of a piece of
land does not include the fruits and products existing thereon, unless the contract
expressly provides otherwise.

REAL PROPERTY UNDER NO. 3: EVERYTHING ATTACHED TO AN IMMOVABLE IN A

FIXED MANNER

ATTACHMENT MUST BE IN A FIXED MANNER

Board of Assessment Appeals v. City Treasurer

Steel towers are not immovable property under paragraph 1, 3 and 5

They can not be included under paragraph 3, as they are not attached to an
immovable in a fixed manner, and they can be separated without breaking the
material or causing deterioration upon the object to which they are attached. Each
of these steel towers or supports consists of steel bars or metal strips, joined
together by means of bolts, which can be disassembled by unscrewing the bolts and
reassembled by screwing the same.

REAL PROPERTY UNDER NO. 5: MACHINERIES, RECEPTACLES, INSTRUMENTS OR

IMPLEMENTS

THEY MUST BE DESTINED FOR USE IN THE INDUSTRY OR WORK

MOVABLES MUST BE PLACED BY THE OWNER

Ago v. CA

Sawmill machineries and equipment are real properties in accordance with Art. 415
(5)
By reason of installment in a building, the said sawmill machineries and equipments
became real estate properties in accordance with the provision of Art. 415(5) of the
Civil Code. It is interpreted similarly to the case of Berkenkotter vs. Cu Unjieng e
Hijos, where the Court held that the installation of the machinery and equipment in
the central of the Mabalacat Sugar Company for use in connection with the industry
carried by that company, converted the said machinery and equipment into real
estate by reason of their purpose. In the present case, the installation of the sawmill
machineries in the building of the Golden Pacific Sawmill, Inc., for use in the sawing
of logs carried on in said building, the same became a necessary and permanent
part of the building or real estate on which the same was constructed, converting

the said machineries and equipments into real estate within the meaning of Article
415(5) of the Civil Code of the Philippines.

Davao Sawmill v. Castillo

Movables must be placed by the owner

Standard Oil ruling key to issue on the character of the property
It must be pointed out that Davao Sawmill should have registered its protest before
or at the time of the sale of this property. It must further be pointed out that while
not conclusive, the characterization of the property as chattels by Davao Sawmill is
indicative of intention and impresses upon the property the character determined
by the parties. In this connection the decision of the court in the case of Standard
Oil vs. Jaramillo, whether obiter dicta or not, furnishes the key to such a situation.

Immobilization of machinery; when placed in plant by owner

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. The distinction rests upon the fact that one only
having a temporary right to the possession or enjoyment of property is not
presumed by the law to have applied movable property belonging to him so as to
deprive him of it by causing it by an act of immobilization to become the property of
another.

APPLICATION OF THE PRINCIPLE OF ESTOPPEL

Sergs Products v. PCI Leasing

Machinery immovable properties by incorporation

The machinery were essential and principal elements of their chocolate-making
industry. Hence, although each of them was movable or personal property on its
own, all of them have become "immobilized by destination because they are
essential and principal elements in the industry." The machines are thus, real, not
personal, property pursuant to Article 415 (5) of the Civil Code.

Parties estopped when parties stipulated properties as personal; property thus

subject to writ of seizure
Contracting parties may validly stipulate that a real property be considered as
personal. After agreeing to such stipulation, they are consequently estopped from
claiming otherwise. Under the principle of estoppel, a party to a contract is
ordinarily precluded from denying the truth of any material
fact found therein. Thus, said machines are proper subjects of the Writ of Seizure

Third parties acting in good faith not affected by stipulation to consider real
property as personal
The holding that the machines should be deemed personal property pursuant to the
Lease Agreement is good only insofar as the contracting parties are concerned.
Hence, while the parties are bound by the Agreement, third persons acting in good
faith are not affected by its stipulation characterizing the subject machinery as
personal. In the present case, however, there is no showing that any specific third
party would be adversely affected.

REAL PROPERTY UNDER NO. 10

Hongkong & Shanghai Banking v. Aldecoa & Co.

Court has jurisdiction as bank does not seek to exercise mortgage right on real
properties in the provinces
The bank is not seeking to exercise its mortgage rights upon the mortgages which
the defendant firm holds upon certain real properties in the Provinces of Albay and
Ambos Camarines and to sell these properties at public auction in these
proceedings; nor does the judgment of the trial court directs that this be done.
Before that property can be sold the original mortgagors will have to be made
parties. The bank is not trying to foreclose any mortgages on real property executed
by Aldecoa & Co.

CONCEPT OF REAL PROPERTY IN REAL PROPERTY TAXES

Meralco vs CBAA

Pipeline means a line of pipe connected to pumps, valves and control devices for
conveying liquids, gases or finely divided solids. It is a line of pipe running upon or
in the earth, carrying with it the right to the use of the soil in which it is placed.
Article 415[l] and [3] provides that real property may consist of constructions of all
kinds adhered to the soil and 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.
The pipeline system in question is indubitably a construction adhering to the soil. It
is attached to the land in such a way that it cannot be separated therefrom without
dismantling the steel pipes which were welded to form the pipeline.
Insofar as the pipeline uses valves, pumps and control devices to maintain the flow
of oil, it is in a sense machinery within the meaning of the Real Property Tax Code.

II. MOVABLE PROPERTY

PERSONAL PROPERTY UNDER NO. ART. 416 (1): "NOT INCLUDED IN ART. 415."

Involuntary insolvency of Paul Strochecker v. Ramirez

Interest in business may be subject of mortgage

With regard to the nature of the property mortgaged which is one-half interest in the
business, such interest is a personal property capable of appropriation and not
included in the enumeration of real properties in articles 335 of the Civil Code, and
may be the subject of mortgage. All personal property may be mortgaged. (Sec. 7,
Act 1508.)

PERSONAL PROPERTY UNDER ART. 416 (2): "BY SPECIAL PROVISION OF LAW."

Sibal v. Valdez

Chattel Mortgage Law recognizes growing crops as personal property

Act 1508, the Chattel Mortgage Law, fully recognizes that growing crops are
personal property. Section 2 of said Act provides that "All personal property shall be
subject to mortgage, agreeably to the provisions of this Act, and a mortgage
executed in pursuance thereof shall be termed a chattel mortgage." Section 7 in
part provides that "If growing crops be mortgaged the mortgage may contain an

agreement stipulating that the mortgagor binds himself properly to tend. care for
and protect the crop while growing." The above provisions of Act 1508 were enacted
on the assumption that "growing crops" are personal property.

PERSONAL PROPERTY UNDER ART. 416 (3): "FORCES OF NATURE."

US v. Carlos

While electrivity is not fluid, still its manifestations and effects like those of gas may
be felt and seen. The true test of what may be stolen is not whether it is corporeal
ro incorporeal, but whether, being poessed of value, a person other than the owner,
may appropirate the same. Electrcity like gas, is a valuable merchandise, and may
thus be stolen.

PERSONAL PROPERTY UNDER ART. 416 (4): "CAN BE TRANSPORTED FROM PLACE TO
PLACE."

Philippine Refining v. Jarque

Vessels are personal property under civil and common law

Vessels are considered personal property under the civil law. (Code of Commerce,
article 585.) Similarly under the common law, vessels are personal property. Under
the common law, vessels are personal property although occasionally referred to as
a peculiar kind of personal property.

PERSONAL PROPERTY UNDER ART. 417 (2): "SHARES OF STOCKS."

Chua Guan v. Samahang Magsasaka

A share of stock in a gold mining corporation is personal property; bu the gold mine
itself, as well as any land of the corporation, is regarded as real

property by the law. The certificate itself evidencing the ownership of the share, as
well as the share itself, is regarded as personal property. Being personal it can be
subject of chattel mortgage.

III. PROPERTY IN RELATION TO THE PERSON TO WHOM IT BELONGS (ARTS. 419-426)

PUBLIC DOMINION AND PRIVATE OWNERSHIP

Republic v. CA

Classification of property as either of public dominion or of private ownership; Public

lands / public dominion
Property, which includes parcels of land found in Philippine territory, is either of
public dominion or of private ownership. Public lands, or those of public dominion,
have been described as those which, under existing legislation are not the subject
of private ownership, and are reserved for public purposes. The New Civil Code
enumerates properties of public dominion in Articles 420 and 502 thereof. Article
420 includes 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; and 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" as property belonging to public dominion. Article 502 adds "rivers and their
natural beds; continuous or intermittent waters of springs and brooks running in
their natural beds and the beds themselves; waters rising continuously or
intermittently on lands of public dominion; and lakes and lagoons formed by
Nature on public lands and their beds; to the enumeration.

Extent of a lake bed

The extent of a lake bed is defined in Artcile 74 of the Law of Waters of 1866, as
the natural bed or basin of lakes, ponds, or pools, is the ground covered by their
waters when at their highest ordinary depth."

Highest Ordinary Depth in a lake; Determinant is rainfall and not gravitational pull
(tides)
The phrase "highest ordinary depth" has been interpreted in the case of
Government. vs. Colegio de San Jose to be the highest depth of the waters of
Laguna de Bay during the dry season, such depth being the "regular, common,
natural, which occurs always or most of the time during the year; or thus rain

"falling directly on or flowing into Laguna de Bay from different sources." While the
waters of a lake are also subject to the same gravitational forces that cause the
formation of tides in seas and oceans, this phenomenon is not a regular daily
occurrence in the case of lakes. The alternation of high tides and low tides, which is
an ordinary occurrence, could hardly account for the rise in the water level of the
Laguna de Bay as observed 4-5 months a year during the rainy season; rather, it is
the rains which bring about the inundation of a portion of the land in question. Since
the rise in the water level which causes the submersion of the land occurs during a
shorter period than the level of the water at which the land is completely dry, the
latter should be considered as the "highest ordinary depth" of Laguna de Bay. The
land sought to be registered, therefore, is not part of the bed or basin of Laguna de
Bay.

Foreshore land defined; Definition does not apply to land adjacent to lake
Foreshore land is that part of (the land) which is between high and low water and
left dry by the flux and reflux of the tides; or the strip of land that lies between the
high and low water marks and that is alternately wet and dry according to the flow
of the tide. In the present case, since the inundation of a portion of the land near
the lake is not due to flux and reflux of tides, it thus cannot be considered a
foreshore land within the meaning cited by the Director of Lands.

Purpose of land registration under Torrens System

The purpose of land registration under the Torrens System is not the acquisition of
lands but only the registration of title which applicant already possesses over the
land. Registration under the Torrens Law was never intended as a means of
acquiring ownership. Applicant in this case asserts ownership over the parcel of land
he seeks to register and traces the roots of his title to a public instrument of sale in
favor of his father from whom he
inherited said land.

Tax declaration strong evidence of ownership acquired by prescription; also Open,

continuous, public, peaceful, exclusive and adverse possession of the land
Applicant presents tax declarations covering the land since 1918 and also tax
receipts dating back to 1948. While it is true that by themselves tax receipts and
declarations of ownership for taxation purposes are not incontrovertible evidence of
ownership, they become strong evidence of ownership acquired by prescription
when accompanied by proof of actual possession of the property. Further, applicant
by himself and through his father before him, has been in open, continuous, public,
peaceful, exclusive and adverse possession of the disputed land for more than 30
years, counted from 19 April 1909, when the land was acquired from a third person
by purchase. Since applicant has possessed the subject parcel in the concept of

owner with just title and in good faith, his possession need only last for ten years in
order for ordinary acquisitive prescription to set in. Applicant has more than
satisfied this legal requirement.

Judicial confirmation of imperfect title

Even if the land sought to be registered is public land, applicant would be entitled to
a judicial confirmation of his imperfect title, since he has also satisfied the
requirements of the Public Land Act (CA 141 as amended by RA 1942). Section 48 of
the Act enumerates as among the persons entitled to judicial confirmation of
imperfect title, such as those who, by themselves or through their predecessors-ininterest, have been in the open, continuous, exclusive, and notorious possession
and occupation of agricultural lands of the public domain, under bona fide claim of
ownership, for at least thirty years immediately preceding the filing of the
application for confirmation of title."

Reclamation requires proper permission; reclaimed land does not automatically

belong to party reclaiming the same
Private persons cannot, by themselves reclaim land from water bodies belonging to
the public domain without proper permission from government authorities. And
even if such reclamation had been authorized, the reclaimed land does not
automatically belong to the party reclaiming the same as they may still be subject
to the terms of the authority earlier granted. In the present case, private oppositorspetitioners failed to show proper authority for the alleged reclamation, therefore,
their claimed title to the litigated parcel must fall.

Tolerance of possession cannot ripen into ownership

As the private oppositors-petitioners entered into possession of the land with the
permission of, and as tenants of, the applicant del Rio; the fact that some of them at
one time or another did not pay rent. Their use of the land and their non-payment of
rents thereon were merely tolerated by applicant and these could not have affected
the character of the latter's possession which has already ripened into ownership at
the time of the filing of this application for registration. Only possession acquired
and enjoyed in the concept of owner can serve as the root of a title acquired by
prescription.

CHARACTERISTICS OF PROPERTIES OF PUBLIC DOMINION.

Vda. De Tantoco v. Muncipal Council of Iloilo

Property of public domain applies to municipal property for public use; both not
within the commerce of man
The principle governing property of the public domain of the State is applicable to
property for public use of the municipalities as said municipal property is similar in
character. The principle is that the property for public use of the State is not within
the commerce of man and, consequently, is unalienable and not subject to
prescription. Likewise, property for public use of the municipality is not within the
commerce of man so long as it is used by the public and, consequently, said
property is also inalienable.

CONVERSION OF PROPERTY OF PUBLIC DOMINION TO PATRIMONIAL PROPERTY.

Cebu Oxygen & Acetylene v. Bercilles

Street withdrawn from public use becomes patrimonial property; Subsequent sale
valid
When a portion of the city street was withdrawn from public use, such withdrawn
portion becomes patrimonial property which can be the object of an ordinary
contract. As expressly provided by Article 422 of the Civil Code, "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." Further, the Revised Charter of the
City of Cebu, 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."
Thus, the withdrawal of the property in question from public use and its subsequent
sale to the petitioner is valid.