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NAVARRO NAVARRO NOTES ON PROPERTY PROP ERTY Part 1 In the Mindan Mindanao ao Bus Company Company yung yung trans transpor portat tation ion buc buc compan company y case, case, which which I was referring 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 that’s 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 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$ect them to a chattel mortgage# Is that allowable# The answer is yes. In other words, again the principle of estoppel will apply. %lthough the machinery inside the building were installed by the owner and they tend directly directly to meet the needs of an industry or wor" which can be carried on in that building, if the parties agree to treat the machinery as chattel and enter into a chattel mortgage, neither of them will be permitted to uestion the &alidity later on of the chattel mortgage on the ground that the sub$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 ponds and you happen happen to bangus bangus in your your -sh ponds, ponds, the bangus bangus are consider considered ed immo&able immo&able real proper property ty e&en if they are swimming swimming around. around. 0or 0or purposes purposes of sale, 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, that’s 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 regard regarding ing this. There There was a barge barge which was at a -(ed -(ed place, place, basta basta nasa -(ed -(ed place e&en if /oating consider it as real property. 0or e(ample '%PC4 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 around Manila Bay dinner is ser&ed, you don’t considered that as real property or immo&able property.
Page 2 of 18 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 $ust want to call your attention. Certain real property by special pro&ision of law also considered as mo&able property. 7ery good e(ample are growing crops. 8rowing crops are considered under certain pro&isions of law as mo&able property under the chattel mortgage law as well as the ci&il code pro&isions on sales they are considered personal property. Sabi nga eh in the case of growing crops, while they are still there growing in the soil, sabi ng SC in the case of Sibal &s 7alde!, it’s a mobili!ation by anticipation. The law already anticipates there subseuently becoming mo&able. 1hen would that happen# 1hen they are actually gathered. So e&en before they are gathered there is mobili!ation by anticipation. That’s’ why they can be a sub$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. That’s 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, that’s 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
Page 3 of 18 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 S? 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 58s 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, it’s for public use and therefore beyond the power of 58 to deal with by means of contract. In one case the 58 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, 58s 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. ailingan "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
Page 4 of 18 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 that’s 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, it’s $ust too bad but
Page * of 18 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 $us utendi. The right to use his property. But the right to use one’s property must be e(ercised in such a way as not to in$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. 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. nder this %rticle, Mr. 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 defendant’s 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
Page of 18 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 abali"at sa aunlaran, 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. n"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 Gnot 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
Page / of 18 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. 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, you’re -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, that’s natural fruits o"ay. Mushrooms, yung mushrooms which are not culti&ated, which $ust sprout in the -eld, especially after a thunderstorm the pre&ious e&ening, those of you who come from the pro&inces, usually after a thunderstorm the pre&ious night, if you wal" early morning, you’ll be able to -nd mushrooms. But you ha&e to be careful because some of these are poisonous. So that could be considered as spontaneous products of the soil. Industrial fruits, on the other hand, are those which are produced by lands through human labor and culti&ation, o"ay. If you are tal"ing of mushrooms produced by a farm, they are cultured, that would be industrial rather than natural fruits. f course you ha&e the third type of fruit, ci&il fruits. 4ents, price of leases of lands and other properties, life annuities and other similar income. %nd then you ha&e accession continua. 2ou ha&e, this is the right gi&en to the owner to e&erything which is incorporated or attached to his property, either naturally or arti-cially. 1ith regard to immo&able property, you ha&e accession industrial, sub classi-cation of accession continua. 2ou ha&e, -rst, with respect to immo&ables, accession industrial which
Page 8 of 18 co&ers building, planting, sowing, and you ha&e accession natural. 1hat would fall under accession natural# %llu&ion, a&ulsion, change of ri&er beds, formation of islands. 1ith regard to personal or mo&able property, you ha&e ad$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 don’t 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 don’t 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, 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 $ust the same. 5ets -rst tac"le the situation contemplated in art. **6. 1hat is the scenario in art. **6# >ere is a land owner, and he decides to build on his property using the materials of another person, o"ay so simpleng simple ang situation. I ha&e a parcel of land, I build a house there, or any other thing, but I used your materials, o"ay. f course, there are always : possibilities. ?ither I am in good faith or in bad faith. 1hen would I be in good faith in that situation# If I thought that I ha&e the right to use those materials. If I thought I owned those materials. I would be in bad faith if I "new that you were the owner of those materials, and despite of that "nowledge, I still used them, o"ay. If I am in good faith, a"ala "o sa"en yung materials na yun, what’s my obligation under art. **6# The law says, I should pay their &alue. I should pay their &alue, that is fair and suare. Can I be held liable for damages# The answer is no because precisely, I was in good faith. I simply ha&e to pay the &alue of the materials owned by you.
Page of 18 If I am in bad faith, ah of course, I ha&e to pay the &alue of the materials plus damages. Kamages would of course be intended to penali!e me for my bad faith. 1hat about you, the owner of the materials# 1hat would be your rights# The law says, you can remo&e your materials, if it is possible to do so without in$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. 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. asi 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. 1hat’s 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, it’s 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, that’s 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 we’re 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 let’s 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. 1hat’s 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. 5et’s 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. asi one reason according to some decisions the builder in good faith is no longer entitled to the fruits during the period of retention. It’s 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. That’s 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 let’s 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 that’s 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. asi sabi natin under the law, planted, built or sown on the land of another. ung 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$udicated in the partition to the other coDowners will ha&e the rights of a builder in good faith. ung terminated na ang coDownership at naDdis"ubre naE >alimbawa, we are the two coDowners during the e(istence of a coDownership o&er a parcel of land. I built on that land. 5ater on, we agree to partition the property. Tapos na ang coDownership. Pag"aDpartition natin naDdis"ubre na ang building "o pala a few suare meters of my building occupying a part allotted to you under our partition agreement. %rt **L can be applied. I will be considered a builder in good faith with the same rights under %rt. **L. The claim of good faith may be made by a successorDinDinterest of the original builder. In one case, a certain land together with the building standing thereon was purchased by a buyer. 5ater on, upon resur&ey of the land it was disco&ered that a portion of that building encroached upon the ad$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 it’s 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. sually 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 . ung 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. asalanan 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# asi 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'S. 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. That’s one underlying principle. ung sino na"inabang sa accession dapat magbayad. That’s 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 that’s 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 $ust the &alue of the land but the &alue of the building as well then ob&iously the ah, the landowner must pay, must pay the &alue of the building, the proper indemnity to the builder. If on the other hand the landowner was not paid the &alue of the building then he does not bene-t from the building it would then be the buyer who will bene-t from the accession it would be the buyer who will ha&e to pay the builder of the proper indemnity. I repeat, he who bene-ts from an accession must be the one who pay for it. "ay. %lright.
Page 1* of 18 5et’s now go to the matter of allu&ion. 1e ha&e the pro&isions of %rticle *6. If you are the owner of a parcel land ad$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. ung 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 that’s 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$acent lands applying the Spanish 5aw of 1aters. If you own a parcel of land ah let’s say in 5a nion and through the action of the sea your land gradually increased in the area nasa sa may tabing dagat. 1ho would own the additional area# %h "abali"at sa "aunlaran wag natin pa"ilalaman yan that belongs to the State. Itong allu&ion ha applicable lang sa ri&ers o"ay hindi "asama dito ang mga shores of the seas pero applying the Spanish law of waters if what is in&ol&ed is a la"e li"e 5aguna de Bay or la"e 5anao for that matter the additional area will also belong to the owner of the ad$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 that’s 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, that’s 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 '%PC4 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 don’t 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 $ust want to call your attention. Certain real property by special pro&ision of law also considered as mo&able property. 7ery good e(ample are growing crops. 8rowing crops are considered under certain pro&isions of law as mo&able property under the chattel mortgage law as well as the ci&il code pro&isions on sales they are considered personal property. Sabi nga eh in the case of growing crops, while they are still there growing in the soil, sabi ng SC in the case of Sibal &s 7alde!, it’s a mobili!ation by anticipation. The law already anticipates there subseuently becoming mo&able. 1hen would that happen# 1hen they are actually gathered. So e&en before they are gathered there is mobili!ation by anticipation. That’s’ why they can be a sub$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. That’s 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, that’s 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 S? 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 58s 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, it’s for public use and therefore beyond the power of 58 to deal with by means of contract. In one case the 58 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, 58s 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. ailingan "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.
