INTRODUCTION TO PROPERTY

§ What is Property
➔ Broadest Sense
◆ Property in the broadest sense is a set of claims that people have in
resources that correspond to duties of respect in others. Property
delineates the rights people have to control and derive value from
resources in the world. Property is a general term for the rules that govern
people's access to and control of things like land, natural resources, the
means of production, manufactured goods, including texts, ideas,
inventions, and other intellectual products.

◆ For most people, property means the things we own.

➔ Constituent Elements
◆ Property is composed of certain constituent elements which are:

● The right to exclude

● The right to use

● The right to transfer

● The right to vindicate

§ Libertarians, Progressives, and Efficiency Theorist view of

property
➔ Property presents us with a “complex coordination problem”.
◆ Property is a tool to manage the complexity of human interactions.

◆ Because property concerns scarce resources and be cause people want

to use resources for their various purposes, we need a way to allocate
posers over those resources, especially use rights.

◆ When resources are scarce, creating rules about property use is

beneficial; however, such rules are also costly to create, define, and
enforce.

1
 ◆ The focus of property law is to minimize the cost of information we need to
figure out ​“who gets to do what with what thing”​.1

➔ Property as Exclusion Strategy

◆ Creates an architecture for the entire property system. Property rights are
not merely impediments to resources ending up in the hands of those who
value them most; they are one of the basic tools that allow markets to
exist in the first place. They are inherently valuable because they enable
people to act, invest, to plan, and to exchange goods and services. They
establish bargaining power that protects individuals from being forced to
comply with the will of others, they are significant part of what makes free
market “free”.

➔ Basic structure of the property system.

◆ Property is the foundation upon which “markets” rest.

◆ Property precedes liberty because we cannot decide how to live if we are

not given the general power to choose how to use things we own.

◆ Property precedes efficiency because initial distribution of of property is

required before exchange is possible (best use).

➔ Property as Modules

◆ Property comes in modules that enable us to know what we own and what
we can do with it. It gives us valuable information, free us from
unwarranted restrictions and promote both freedom and efficiency. They
allow us to take things for granted. Property law places distinct limits on
our freedom to disaggregate property rights.

➔ Readings:
◆ Thomas W. Merril & Henry E. Smith, What Happened to Property in Law
and Economics? 111 YALE L. J. 357, 380 (2001)

§ Lawyer’s View on Property

➔ Property is an entitlement to resources protected by legal institutions

◆ Lawyers, however, understand property as legal relations among persons

with respect to things. Some scholars deem property to be a natural right

1
Thomas W. Merril & Henry E. Smith, What Happened to Property in Law and Economics? 111
YALE L. J. 357, 380 (2001)
2
 while others view it as a delegation of covering poser or as a package of
legal entitlement.2

◆ Property is a framework for “interaction of persons in society” as well as

the foundation and infrastructure of private law.

◆ Property laws delineate the rights people have to control and derive value
from resources in the world.

◆ Property laws tell us what is mine and what is not mine. Without rules
about this, the world will be a chaotic and probable quite violent place to
live in.

➔ The concept of property is reserved for a legally protected entitlement. A thing is

not property in the legal sense unless its holder could vindicate his/ her rights in
the court of laws.3

➔ Property as an institution embraces these many forms and different societies

have various mixtures of them.

§ Purpose of Property
➔ Institution of property provides for an effective way of managing society’s
resources.4

◆ Tragedy of the Commons5

● A situation where there is no property rights; what there is there is a

shared resource system (common ownership) where individual
users acting independently according to their own self-interest
behave contrary to the common good of all users by depleting that
resource through their collective action.

◆ Decentralized management of resources and permits owners-managers to

specialise in developing the knowledge and skill pertinent to their
particular resources. Example:

● Capitalism

○ Preeminence of private ownership;

○ Citizens have private property;

2
Joseph W. Singer, Property as the Law of Democracy, 63 Duke L. J. 1287 (2014)
3
Property as the Law of Things, 125 HARV. L. REV. 1691 (2012)
4
Thomas W. Merril and Henry E. Smith, The Oxford Introduction to U.S. Law: Property, Oxford
University Press, 2010
5
Garret Hardin, Tragedy of the Commons, 162 Science 1243 (1968)
3
 ○ Market forces decides what is best to do with resources;
Market economy.

● Communism/Socialism

○ Preeminence of state ownership;

○ Citizens have limited property, the state owned most of the

resources (Super Regalian Doctrine)

○ The state decides what is best to do with resources.

◆ More stable and requires fewer expenditures as against might is right.

➔ Provides a powerful set of incentives for person to make investments in and to

engage in effective management of resources they control.

◆ Reaping what you sow.

◆ Other forms of resources management provides no assurance that those

who put in effort to improve the resource will be able to appropriate the
fruits of their efforts.

➔ Facilitates the making of contracts regarding the use and control of resources.

◆ Property enables efficient exchange of resources, we know who use and

control the resources.

◆ People will know who they need to contact to access specific resources.

◆ Important in the modification or change in the use of property.

➔ It is a source of individual autonomy

◆ Private individuals controls the direction of their lives because they have
the means and the resources to do so.

◆ This is critical to personal identify or to the development of individual

personality.

➔ It is important to the preservation of liberty and a source of countervailing power

to the power of the State.

◆ With private property, individuals can organized oppositions to

government policies

◆ if the government controls all the resources, citizens will have no means to
effect change and will lead to autocracy.

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 ➔ Readings:
◆ Garret Hardin, Tragedy of the Commons, 162 Science 1243 (1968)

§ Basic Features of Property System

➔ In order for an economy to reach its full potential, there are three (3) basic
features which its system of property rights must have:6

➔ Universality

◆ All valuable, scarce resources must be owned by someone. An economy

where certain resources cannot be use by someone would be smaller than
the same economy where this resources could be used.

➔ Exclusivity

◆ If an owner is unable to exclude others from the use and enjoyment of the
property, then the owner has no incentive to improve the property.

➔ Transferability

◆ The more efficient person should be allowed to acquire the property of the
less efficient one for mutual benefit. The right to transfer is vital for
efficiency in our market economy because it helps ensure that property is
devoted to its most valuable use. What is the extent of the restrictions

➔ Readings:
◆ Howard Gensler, Property Law as an Optimal Economic Foundation, 35
Washburn L.J. 50, 51-52 (1995)

§ Issues and Concern

➔ Division of the world into separate parcels of lands and discrete object of
personal property, each with its individual owners. i.e. effects of externalities to
other property owners

➔ Monopoly - confers monopoly of control on someone with respect to a particular

resources that was awarded to him/her.

➔ Commodification of values and social relations. The more we extend the sphere
of of property, the more we think about the world in terms of owner- object
relation.

6
Howard Gensler, Property Law as an Optimal Economic Foundation, 35 Washburn L.J. 50, 51-52
(1995)
5
 ➔ It promotes inequality. Allows property owners to exclude others from using and
enjoying resources that he/she owns.

§ Theories on Property
➔ All five theories help form the foundation of property law. No one theory is
accepted as the only justification for property

➔ First Possession
◆ Rules of first possession are the regulation of a competitive process of
acquiring unowned resources.

◆ It is the allocation of property rights to the first possessor.

● Intended to reduced conflict and unnecessary competition;

● Much less wasteful of resources if a clear winner emerges early on

in the process of appropriation;

● Notice to others that a claim is being asserted is important for #2;

the lack of notice might lead others to compete with the original
hunter; and

● The end result of first possession is private property.

◆ Rule on Discovery - the thing is awarded to those who first made a claim
on the resources

● Treaty of Tordesillas

◆ Readings:
● Carol M. Rose, Possession as the Origin of Property, 52 U. Chi. L.
Rev. 73 (1985)

● Pierson vs. Post, Supreme Court of New York, 3 Cai. R. 175 (1805)

● Brumagin vs. Bradshaw, 39 CAL 24 (1870)

● Popov vs Hayashi, (WL 31833731 Ca. Sup. Ct. 2002)

● Johnson vs McIntosh, 21 U.S. (8 Wheat.) 543 (1823)

● Carino vs Insular Government, 212 U.S. 449 (1909)

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➔ Labor Theory
◆ John Locke resigned the each person is entitled to the property produced
through his own labor. Locked argued that when a person mixed his own
labor with natural resources which are unowned, he acquired property
rights in the mixture. Before labor was added, the thing had no value, once
labor is mixed, the thing becomes private property.

◆ More applicable in areas where there is no established ownership, i.e.

U.S. where the colonist worked to be able to accumulate wealth as
contrast to Mexico/Peru where the colonist found enormous wealth from
the native inhabitants

◆ Readings:
● Vaughn, Karen, John Locke and the Labor Theory of Value, Vol. 2,
No. 4 Journal of Libertarian Study, (1978)

➔ Utilitarian/Economic Theory
◆ Maximise Societal Happiness

● We recognized property in order to maximise the overall happiness

of society; to best promote the welfare of all citizens. (Jeremy
Bentham)

◆ Law and Economics Approach

● An efficient method of allocating valuable resources in order to

maximise one particular face of social happiness, wealth, and
measured in currency. Property exists to ensure that owners use
resources in an efficient manner - that is, in a manner which
maximises economic valued defined as a person’s willingness to
pay.

◆ ​Harold Demsetz

● Theory of Property Rights7

● Property is an institution for “internalizing externalities” associated

with the use of scarce resources. An externality is some benefit or
cost generated by one person’s activity that is involuntarily bored by
some other person.

7
Harold Demsetz, Toward a Theory of Property Rights, 57 AM. ECON. REV. PAPERS & PROC. 347
(1967)
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 ● The Demsetz theory posits that another way of internalizing
externalities associated with the use of resources is by establishing
property rights in the resources. Property rights, as Demsetz
understood them, are rights to exclude others from specific things
or resources. By creating such exclusion rights and converting
them on an identified owner, man of the benefits and costs
associated with the use of the resource - which otherwise would be
experienced as externalities by the others - will instead be borne by
the owner. By giving the owner exclusive control over the resource,
decisions that affect the value of the resource in a positive or
negative direction will be captured by the owner.

● The owner thus has a powerful incentive to take these benefits and
costs into account in deciding how to use the resource.

● Setting Up of Institutions to Protect Property Rights

○ It is necessary to define resources subject to ownership,

specify how owners are identified, set up institutions to
resolve disputes over ownership, and devise mechanisms
for enforcing ownership rights.

○ If the costs of establishing and enforcing property rights

exceed the benefits of internalisation from establishing and
enforcing property rights, resources will remain in the
unowned (open-access) state. Thus, for a thing to be
governed by property regime, the following should be
present:

○ There must be enough demand for the resource relative to

its supply that internalization of externalities associated with
use of the resource will produce significant benefit.

○ If something is regarded as having no value, or negative

value, it is also unlikely tat the thing will be treated as
property.

○ Property in a given class of resource is unlikely to exist if

there are “high costs of establishing and enforcing” such
right. Some assists are easier to delineate and enforce as
property than other assets.

◆ Readings:
● Harold Demsetz, Toward a Theory of Property Rights, The
American Economic Review, Vol. 57, No. 2 (1967)

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➔ Democracy
◆ In a state in which private property does not exist, citizens are dependent
on the goodwill of the government. They come to the state as beggars
rather than right holders.

◆ Any challenge to the state may be stifled or driven underground by virtue

of the fact that serous haleness could result i the withdrawal of the goods
that give people basic security.

◆ A right to private property, free from government interference, is in this

sense a necessary basis for a democracy.8

◆ Readings:
● Cass R. Sunstein, On Property and Constitutionalism, 14 Cardozo
L. Rev. 907, 914-15 (1993)

➔ Personhood
◆ Georg Hegel

● Argues that property is necessary for an individual’s personal

development.

● Each person has a close emotional connection to certain tangible

things, which virtually become part of one’s self.

◆ Margaret Jane Radin9

● The gauge of the strength or significance of someone’s relationship

with an object by the kind of pain that should be occasioned by its
loss; pain that cannot be relieved by a simple object’s replacement;
because of this connection to the property, the owner should be
accorded a broad liberty with respect to control of that thing.

● All things equal, a right to personhood priority should be given

priority over a conflicting claim by the owner of non-personhood
property.

◆ Readings:
● Margaret Jane Radin, Property and Personhood, 34 Stan. L. Rev.
957-61, 1013-15 (1982)

8
Cass R. Sunstein, On Property and Constitutionalism, 14 Cardozo L. Rev. 907 (1993)
9
Margaret Jane Radin, Property and and Personhood, 34 Stan. L. Rev. 957 (1982)
9
§ Legal Theories on Property
➔ Natural Theory
◆ A philosophical system of legal and moral principles purportedly deriving
from a universalized conception of human nature or divine justice rather
than from legislative or judicial action; moral law, embodied in the
principles of right and wrong.

◆ Thomas Aquinas concludes that, given certain detailed provision:

● it is natural for man to possess external things

● it is lawful for a man to possess a thing as his own

● the essence of theft consists in taking another's thing secretly

● theft and robbery are sins of different species, and robbery is a

more grievous sin than theft

● theft is a sin; it is also a mortal sin

● it is, however, lawful to steal through stress of need: "in cases of

need all things are common property."

➔ Legal Positivism
◆ The theory that legal rules are valid only be cause they are enacted by
existing political authority or accepted as binding in a given society not
because they are grounded in morality or in natural law. Property rights
are thus defined by the State

◆ Property laws delineate the rights people have to control and derive value
from resources in the world. For legal scholars, we use property to refer to
entitlements to resources protected by formal legal institutions.

● Property laws tell us what is mine and what is not mine. It is

reserved for a legally protected entitlement.

● A thing is not property in the legal sense unless its holder could
vindicate his/her rights in the court of laws.

● Property is closely related to rule of law.

◆ Property rights are not absolute

● Much of property law is devoted to reconciling disputes between

different owners or between an owner and the community.

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 ◆ Property rights evolve as law changes

● A core value of our property system is stability of title - the concept

that property rights should be certain and predictable. But the
nature and scope of property do evolve slowly over time, as
chasing economic, technological and social conditions gradually
reshape the law. i.e. traditional notion that a land owner held title to
all the airspace above her land - the invention of airplane ended the
traditional notion.

➔ Property as the Law of Things

◆ The Latin expression for this is that property rights are ​“in rem”​, which
comes from the word ​”res” or things, and indicated that property rights
pertains directly to things rather than to people. It is universally binding on
all who encounter the object.

◆ Property as Notice

● Property law comes in a standard set of forms and serves as notice

to everyone, depending on the physical nature and character, and
location of the property on how to behave. The in rem aspect of
property gives information to large and indefinite audience on how
to interact with each other with regard to the thing.

● Property needs to be general, stable, and give proper notice on the

widest possible audience. Achieving generality, stability, and notice
requires managing information: facilitating coordination on this
scale requires simplicity and a degree of formalism precisely
because the audience is in rem.10

◆ Property Rights bind the world not just a particular pair of parties.

● Property in the broadest sense is a set of claims that people have

in resources that correspond to duties of respect in others.

● It is “in rem” because the right attaches to the object, rather than to
particular people, it is universally binding on all who encounter the
object.

◆ The Duty to Keep Off

● The other side of the owner’s right to exclude, use and transfer
properties, it is the duty of the other members of society to keep off,

10
Henry E. Smith, The Language of Property: Form, Context, and Audience, 55 STAN. L. REV. 1105,
1148–57 (2003).
11
 to respect such rights, unless the owner has given permission to
enter or use the thing.

● Property in the broadest sense is a set of claims that people have

in resources that correspond to duties of respect in others
generally.

◆ Distinguished from ​“in personam"

● In Contracts for instance, rights are created by particular

agreements between particular persons which creates obligations
binding on these persons with respect to each other and no one
else.

● These are personal rights and are binding only on the parties to the
contracts.

○ Personal rights do not exit automatically as a matter of law.

○ They are only created when persons engage in certain acts

that creates obligations specified by the contract and binding
only on parties to the contract.

◆ “In rem”​ proceeding and the jurisdiction of the court over a thing.

● In rem proceeding allows a person to place some things under the

authority of the court, which will, after providing to all interested
claimants the required notice and opportunity to be heard, make a
definitive adjudication of who owns the thing.

◆ Readings:
● Henry Smith, Property as the Law of Things, 125 Harvard Law
Review, Vol.1691

➔ The Right to Exclude

◆ William Blackstone

● Defined property as “the sole and despotic dominion which one

man claims and exercises over the external things of the world, in
total exclusion of the right of any other individual in the universe.”11

◆ Arguably one of the most significant and essential elements in defining our
understanding of what constitutes property. Historically, the right to
exclude concerns the relationship between people with respect to things,
“such that the so-called owner can exclude others from certain activities or
11
William Blackstone, Commentary on the Laws of England
12
 permit others to engage in those activities and in either case secure
assistance of the law in carrying out this decision.” But, from a present-day
perspective, the right has evolved beyond the legal constructs of
traditional property law to also encompass legal entitlements and benefits
possessed by one person over another irrespective of the legal
relationship between such person and the thing in which the right is
claimed.

◆ Primacy of the Right to Exclude12

● Give someone the right to exclude others from a valued resource

and you give them property. Deny someone the exclusion right and
they do not have property.

● If one starts with the right to exclude, it is possible to derive most of

the other attributes commonly associated with property through the
addition of relatively minor clarifications about the domain of the
exclusion right. On the other hand, if one starts with any other
attribute of property, one cannot derive the right to exclude by
extending the domain of that other attribute; rather, one must add
the right to exclude as an additional premise.

● The right to use is an important attribute of property closely

associated with the right to exclude. At its core, the gatekeeper
right is the right to determine the use of resources, by exercising
the power of exclusion and inclusion. But the right to exclude
cannot be derived from the right to use.

● To determine whether or not someone who has the right to transfer

resources also has a general right to exclude others from the
resources, we need to know additional information about the scope
of their powers, specifically, whether they are owners. The right to
transfer, by itself, cannot lead us to this further information about
which incidents of property the transferor enjoys.

● Exception to the Right to Exclude

○ Necessity

○ Custom

○ Public Accommodation Laws

○ Anti-discriminatory Laws

12
Thomas W. Merrill, Property and the Right to Exclude, 77 Neb. L. Rev. (1998)
13
 ◆ Readings:
● Thomas W. Merrill, Property and the Right to Exclude, 77 Neb. L.
Rev. (1998)

● Lariza Kats, Exclusion and Exclusivity in Property Law, Queen’s

Faculty of Law, Legal Studies Research Paper Series, Accepted
Paper No. 08-02

● Daniel A. Farber, Access and Exclusion Rights in Electronic Media:

Complex Rules for a Complex World , 33 N. Ky. L. Rev. 459 (2006)

● Jacque v. Stenberg Homes, Inc. (1997) - Trespass

● Uston v. Resorts International Hotel (1982) - Limits on the right to

exclude from property open to the public

● Desnick v. American Broadcasting Companies, Inc. - Public Policy

on Limits on the right to exclude.

● Lloyd Corporation v Tanner (407 U.S. 551) - free speech right vs

public and private property

● Uston v. Resorts International Hotel, Inc. 89 N.J. 163 (1982) - can

you exclude a “card counter” in a Casino?

➔ Bundle of Rights
◆ This school of thought denies the existence of any essential core to the
concept of property. Rather, property is just a word denoting a bundle of
rights or more metaphorically, a bundle of stick - in which each individual
stick (whether it be a right or privilege) can be added or removed without
necessarily changing the characterization of the bundle as property.

◆ The law shifted from giving the owner dictatorial control over who and
what to exclude or include, and instead seeks to prescribe rules about
permissible and impermissible uses that constrain all relevantly situated
owners. Exclusion shoes off into governance.

● The Legal Realist Movement that started in the 1920 advance this
alternative view in order to debunk the notion of property as a
natural high protected by the Constitution against fundamental
reform.

◆ Trinity of Rights - The right to exclude, to use and to transfer defines the
core property.

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 ◆ Perspective and Analysis13

● “At least since Blackstone, property rights discourses has been

plagued by absolutism, the notion that the right of property should
be defined as the “sole and despotic dominion” over the res, to the
“total exclusion of the right of any other individual in the universe.”

● Property professors and courts generally refer to the collection of

rights that private property owners enjoy vis-a-vis other landowners
and the public as a “bundle of sticks” in an attempt to render rather
abstract concepts more concrete. The prevailing metaphor,
however, lends itself to a formalistic, absolutist conception of these
interests, implying that the stick, such as the right to devise or the
right to convey, are things... therefore the composition of the bundle
must be an immutable and essential state of affairs. In contrast,
many scholars insist that property rights are neither static nor
absolute. The recognition of private property interest involves
tradeoffs with community values and egalitarian goals; therefore the
exact composition of the bundle of sticks must be recognized as a
mediation between these interests. Moreover, the palace struck is
always tentative, subject to constant re-evaluation in the light of
current needs and norms.

○ Countryside and Rights of Way Act ​(England and Wales) -

Many landowners in the United Kingdom have, in the past,
strongly defended their property rights. Even uncultivated
and unenclosed land was formerly heavily protected in some
areas, mostly to preserve the land owner's hunting or fishing
rights. This in turn left the general public with little access to
natural areas. The Act implements the so-called "right to
roam" (also known as jus spatiandi) long sought by the
Ramblers' Association and its predecessors, on certain
upland and uncultivated areas of England and Wales. The
act refers to areas of “mountain, moor, heath and down” in
addition to registered common land; not all uncultivated land
is covered. The Ramblers' Association works to increase the
rights of walkers in the United Kingdom and has been a
driving force behind the recent legislation increasing the
public's access to the wilderness.

◆ Readings:
● Klein and Robinson, Property: A Bundle of Rights, Econ Journal
Watch

13
Sparkling and Coletta, Property - A Contemporary Approach, 2nd Edition, West (2012), p. 65-66
15
 ● J.E. Penner, The “Bundle of Rights” Picture of Property, 43 UCLA
L. Rev. 711 (1996)

§ Property under the Civil Code of the Philippines

➔ Part of Civil Law
◆ Family law; Contracts and obligations; Property Law; Succession, estate,
probate, and testamentary laws; Agency; Law of Torts

➔ Definition
◆ All things which are or may be the object of appropriation are considered
as property which can either be immovable or real property or movable or
personal property (Art. 414, NCC)

● Property was not exactly defined in the Code, the word was used to
signify or describe the subject of property, which is real or personal
property.

● Appropriation or acquisition

○ The most essential incidents to property is the right to

appropriate or acquire the thing by anly lawful or legitimate
means.

○ Original and derivative mode of appropriation

○ Prescription by adverse possession

○ Capacity to acquire is necessary -

➔ Rights Over Things

◆ Things and Property Distinguish

◆ Rights as Property

● Real Rights

● Personal Rights

● Distinctions

➔ Kinds of Property
◆ Property is divided into several classes which are well categorized and
recognized by law.

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◆ As to Physical Characteristics

● Immovable Property ​(Real Property)

○ Enumeration of Immovable Property (Art.415,NCC)

○ Classes of Immovable Property

◆ Immovable by nature - paragraphs 1 and 8

◆ Immovable by incorporation - paragraphs 2,3,4, and 6

◆ Immovable by destination - paragraphs 4,5,6,7 and 9

◆ Immovable by analogy or by law - paragraph 10

○ Extent of Ownership ​(Art. 437, NCC)

◆ Includes the surface and everything under it and he

can construct thereon any works or make any
plantations and exceptions which he may deem
proper, without detriment to servitudes and subject to
special laws and ordinances. He cannot complain of
the reasonable requirement of aerial navigation.

○ Minerals are not included

◆ Article XII of the Constitution

◆ Republic Act No. 7942 (Philippine Mining Act of

1991)

● Section 76. Entry into Private Lands and

Concession Areas. - Subject to prior
notification, holders of mining rights shall not
be prevented from entry into private lands and
concession areas by surface owners,
occupants, or concessionaires when
conducting mining operations therein:
provided, that any damage done to the
property of the surface owner, occupant, or
concessionaire as a consequence of such
operations shall be properly compensated as
may be provided for in the implementing rules
and regulations: provided further, that to
guarantee such compensation, the person
authorized to conduct mining operation shall,
prior thereto, post a bond with the regional

17
 director used on the the of properties, the
prevailing prices in and around the area where
the mining operations are to be conducted,
with surety or sureties satisfactory to the
regional director.

◆ Public Land Act ​(Commonwealth Act No. 141)

● Section 110. Patents or certificates issued

under the provision of this Act shall not include
nor convey the title to any gold, silver, copper,
iron, or other metals or minerals or other
substances containing minerals, guano, gum,
precious stones, coal, or coal oil contained in
lands granted thereunder. These shall remain
to be property of the State.

● The prohibition applies also to lease of public

lands under Section 41. The lease of
agricultural lands may be cancelled after notice
if the said lands is more valuable for mineral
extraction.

○ Hidden Treasures ​(Art.438/439,NCC)

◆ Hidden and unknown deposit of money, jewelry or

other precious objects (Personal Property) the lawful
ownership of which does not appear (Art. 439, NCC)

◆ Belongs to the owner of the land/building (Principle of

Accession)

◆ If by chance 1/2 belongs to the finder but not when he

is a trespasser

◆ The State may acquire hidden treasure at their just

price; Ground: Science/Art

◆ Movable Property ​(Personal Property)

● Enumeration under Art.416 and 417, NCC

○ Those movables susceptible of appropriation which are not

included in the preceding article;

○ Real property which by any special provision of law is

considered as personal property;

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 ○ Forces of nature which are brought under control by science;
and

○ In general, all things which can be transported from place to

place without impairment of the real property which they are
fixed.

○ Obligations and actions which have for their object movables

or demandable sums; and

○ Shares of stock of agricultural, commercial and industrial

entities, although they may have real estate

● Consumables or Non-Consumables underArt.418, NCC

○ Fungible or Non-Fungible

● Things severed from real property

○ As a general rule, property which is essentially real may

become personal property by severance from the real
property from which it was previously attached.

● Choses of Action

○ A thing which of which one has not the possession or actual

enjoyment, but only a right to or a right to demand by an
action of law. Choses of action are generally considered as
personal property.

○ Two recognized signification - in the broad sense, it includes

all right of action whether ex contractu or ex delicto. In the
strict sense, it involves an assignable rights of action ex
contractu, and perhaps, ex delicto for injuries to property or
for torts connected to a contract.

● Importance of Distinguishing Movable from Immovable

○ Rules on Ownership Rights

◆ Statute of Limitations

◆ Collateral

○ Registration of ownership and interest in Property Registries

◆ Torrens Title Registry

◆ Ships and Motor Vehicles Registry

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 ◆ Chattel Mortgage Registry

○ Taxation

◆ Real property Taxation

◆ As to Ownership

● Common and Unowned (Res Nullious)

● Public Dominion

○ Property intended for public use(Art.420,par.1,NCC)

○ Property for public service(Art.420,par.2,NCC)

○ Property for the development of national wealth (Art. 420,

par. 2, NCC)

○ Patrimonial property (Article 421,NCC)

● Private Property

○ All properties belonging to private persons either individually

or collectively (Art. 425, NCC)

◆ Sole ownership

◆ Co-ownership (Simple, Partnerships, Corporations,

and other forms of multiple ownership)

➔ Readings and Cases:

◆ Chattel Mortgage Law (Act No. 1508, 1906)

◆ Leung Tee vs. Strong Machinery Co. (37 Phil 644)

◆ Standard Oil Co. vs. Jaranillo (44 Phil. 631)

◆ Davao Saw Mill vs. Castillo (61 Phil 709)

◆ Berkkenkotter vs. Cu Unjieng (61 Phil. 663)

◆ Makati Leasing and Finance Corporation vs. Wearever Textile Mills (125
SCRA 269)

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