LAWS ON PROPERTY

GEL 11/1487
SATURDAYS 9:00-12:00 NN

Engr. Irene May Tacugue Lopez

John Paul II College of Davao

COURSE DESCRIPTION
Real Property (or immovable
property) and Personal
Property (or Movable Property)

COURSE OBJECTIVES

COURSE OUTLINE

COURSE OUTLINE

GOVERNING LAW
Republic Act No. 386
June 18, 1949
The Civil Code of the
Philippines
AN ACT TO ORDAIN AND
INSTITUTE THE CIVIL CODE OF
THE PHILIPPINES

Definition of Property
in the Civil Code
Considered

as an object, is that
which is, or may be,
appropriated. ( Article 414)

Definition of Property
as a Subject in a Law Course
Branch

of civil law which

classifies and defines the
different kinds of appropriable
objects, provides for their
acquisition and loss, and in
general, treats of the nature and
consequences of real rights.

BASIC PRINCIPLES:
concept of Property
Art. 414. All things which are or
may be the object of
appropriation are considered
either:
(1) Immovable or real
property; or
(2) Movable or personal
property.

(Civil law concept) all things

whether tangible [physical
objects] or intangible [rights]
which are or may be the object of
appropriation. (see Art. 414
NCC ).

It follows that those which cannot

be appropriated are not
considered property. [i.e. stars,
moon, air, planets, etc.]

However,

in Escano vs. Gil [CA]

February 11, 1958, it was held
that the right to office, though
not a vested property right, in a
technical sense, is property. An
office may be considered as
property in controversies relating
to the question as to which of two
persons is entitled thereto.

In Minoza vs Great Pacific Life

Assurance Corp., July 21, 1986, it
was held that the right of a person
to his labor is deemed to be
property within the meaning of
constitutional guarantees. As it
involves his means of livelihood, a
person cannot be deprived
therefore, of his labor or work
without due process of law.

In Cornejo vs Gabriel, 41 Phil. 200,

it was ruled that property, under
the due process clause of the
Constitution, includes the right to
hold, occupy and exercise an
office.

What is appropriation?
The New Civil Law Code does not

define what is appropriation, but

it has been considered as
equivalent to occupation, which
is the willful apprehension of a
corporeal object, which has no
owner, and with intent to acquire
its ownership.

PROPERTY, classification
- Immovable
or real property;
of
:
- Movable or personal
property.

Why is there importance

to classify?

Because different provisions of

the law govern the acquisition,
possession, disposition, loss and
registration of immovable and
movable.

For example :

a. Donations of real property (like

land) must be in a public
instrument, otherwise the
alienation will be null and void
even as between the parties. On
the other hand, the donation of a
movable (like a ring valued at say
P5,000.00), needs only to be in a
private instrument. (see Art. 748,
NCC).

b. The ownership over a real

property may be acquired by
prescription (see Art. 1137) in 30
years (bad faith); whereas,
acquisition of personal property
in bad faith needs only 8 years
(see Art. 1132, NCC).

IMMOVABLE
PROPERTY

Definition of Immovable
Property
The

law does not define what

properties are immovable; they
are merely enumerated

Art. 415. The following

are
immovable
property:
(1) Land, buildings, roads and
constructions of all kinds
adhered to the soil;
(2) Trees, plants, and growing
fruits, while they are attached to
the land or form an integral part
of an immovable;

(3) Everything attached to an

immovable in a fixed manner, in
such a way that it cannot be
separated therefrom without
breaking the material or
deterioration of the object;

(4) Statues, reliefs, paintings

or other objects for use or
ornamentation, placed in
buildings or on lands by the
owner of the immovable in
such a manner that it reveals
the intention to attach them
permanently to the
tenements;

(5) Machinery, receptacles,

instruments or implements
intended by the owner of the
tenement for an industry or
works which may be carried
on in a building or on a piece
of land, and which tend
directly to meet the needs of
the said industry or works;

(6) Animal houses, pigeonhouses, beehives, fish ponds or

breeding places of similar
nature, in case their owner has
placed them or preserves them
with the intention to have them
permanently attached to the
land, and forming a permanent
part of it; the animals in these
places are included;

(7)

Fertilizer actually used on

a piece of land;

(8)

Mines, quarries, and slag

dumps, while the matter
thereof forms part of the bed,
and waters either running or
stagnant;

(9) Docks and structures which,

though floating, are intended
by their nature and object to
remain at a fixed place on a
river, lake, or coast;
(10) Contracts for public works,
and servitudes and other real
rights over immovable
property.(334a)

Classes of Immovable:
IN GENERAL :
a)Immovables by nature
b)Immovables by incorporation
c) Immovables by destination
d) Immovables by analogy or
by law

Immovables by nature

those which cannot be moved

from place to place because of
their nature, such as land (par 1
Art. 415), mines, quarries and
slag dumps (par 8, Art. 415);

PARAGRAPH 1:

Land, buildings, roads and constructions of

all kinds adhered to the soil.

PARAGRAPH 8:

Mines, quarries, and slag dumps

while the matter thereof forms part
of the bed, and waters, either
running or stagnant.

Immovables by
- those which are essentially
incorporation

movables, but are attached to an

immovable in such manner as to
become an integral part thereof.
[Examples: those mentioned in
par 1, 2, 3, 4 & 6, Art. 415,
except land, buildings and
roads];

(1) Land, buildings, roads and constructions of all kinds

adhered to the soil;

(2) Trees, plants, and growing fruits, while they are

attached to the land or form an integral part of an
immovable;

(3) Everything attached to an immovable in a fixed manner,

in such a way that it cannot be separated therefrom
without breaking the material or deterioration of the
object;
(4) Statues, reliefs, paintings or other objects for use or
ornamentation, placed in buildings or on lands by the
owner of the immovable in such a manner that it reveals
the intention to attach them permanently to the tenements;

(6) Animal houses, pigeon-houses, beehives, fish ponds or

breeding places of similar nature, in case their owner has
placed them or preserves them with the intention to have
them permanently attached to the land, and forming a
permanent part of it; the animals in these places are
included;

c) Immovables by
- those which are essentially
destination

movables, but by the purpose for

which they have been placed in
an immovable, partake the
nature of the latter because of
the added utility derived
therefrom, such as those
mentioned in pars 4, 6, 7 & 9 of
Art. 415);

(4) Statues, reliefs, paintings or other objects

for use or ornamentation, placed in buildings or
on lands by the owner of the immovable in such
a manner that it reveals the intention to attach
them permanently to the tenements;
(6) Animal houses, pigeon-houses, beehives,
fish ponds or breeding places of similar nature,
in case their owner has placed them or
preserves them with the intention to have them
permanently attached to the land, and forming
a permanent part of it; the animals in these
places are included;
(7) Fertilizer actually used on a piece of land;
(9) Docks and structures which, though floating,
are intended by their nature and object to
remain at a fixed place on a river, lake, or coast;

Immovables by analogy
those
in par 10, Art.
or
by mentioned
law

415; right of usufruct; easements

and servitudes;

(10) Contracts for public

works, and servitudes and
other real rights over
immovable property.(334a)

SPECIFICALLY :
Art. 415. The following are
immovable property:

PARAGRAPH 1:

(1) Land, buildings, roads and constructions of

all kinds adhered to the soil;

REMINDERS : LAND
Land by its very nature is immovable. And
even, if land is moved by an earthquake or
an extra-ordinary happening, the land
should still be considered immovable. A
truckload of soil [i.e. garden soil] should
be considered personal property since
there is no longer adherence to the soil.

Even

if land is rented, it is still

considered as immovable.

BUILDINGS
Buildings of permanent structure are
always classified as immovable. It is
immaterial whether it is built on a
rented or owned land. The nature of
the building as property does not
depend on the way the parties deal
with it [see: Leung Yee vs Strong
Machinery Co. 37 Phil. 664.]

Buildings are considered

immovable provided they are
more or less permanent
substantially adhering to the
land, and not mere superimpositions on the law.

In Luna vs Encarnacion, it was

held that a structure which is
merely superimposed on a land
like a temporary shelter for
workers is not real or immovable
property.

CONSTRUCTIONS

It

is understood that the attachment must

be more or less permanent.

wall or a fence are good examples of this

kind of immovable by incorporation.

As long as there is an intent to

permanently annex the same, it
is immaterial whether the
materials used is only made of
stone. Railroad tracks or rails
come under this category.

Wooden

scaffoldings on which
carpenters stand while
constructing a house are merely
personal property in view of the
lack of adherence to the soil or
the intent to permanently annex
the same to the soil.

PARAGRAPH 2:

Trees, plants and growing

crops, while they are
attached to the land or form
an integral part of an
immovable.

Trees and plants no matter what

their size may be are considered
real property.

By

nature - if they are the

spontaneous products of the soil,
and by incorporation - if they
were planted thru labor.

But

the moment they are

detached or uprooted from the
land, they become personal
property, except in the case of
uprooted timber, if the land is
timberland, because although no
longer attached, the timber still
forms an integral part of the
timberland.

Rule on UNGATHERED
FRUITS :

Even if the land is being leased

by another, and the fruits belong
to the tenant, the fruits are still
considered as immovable
because no exception or
qualification is made under the
Civil Code.

In

Sibal vs Valdez, 50 Phil 512,

the Supreme Court held that for
purposes of attachment and
execution, and for purposes of
the Chattel Mortgage Law,
ungathered products have the
nature of personal property.

Rule on UNGATHERED
FRUITS :
General Rule: Immovable

Exception:
purpose of Chattel Mortgage
law

PARAGRAPH 3:
Everything

attached to an
immovable in a fixed manner,
in such a way that it cannot
be separated therefrom
without breaking the material
or deterioration of the object.

Under

this paragraph, for the

incorporated thing to be
considered real property, the
injury or breakage or deterioration
in case of separation, must be
substantial. [Examples: A fixed fire
escape stairway firmly embedded
in the walls of the house;
aqueduct; or a sewer or a well.

In

CBAA vs MERALCO, 119 Phil.

328, it was ruled that the steel
towers of MERALCO not attached to
an immovable in a fixed manner
are not realty and therefore, not
subject to realty tax. The towers
can be separated from the ground
without breaking or causing
deterioration upon the object to
which they are attached.

However,

in CALTEX vs CBAA,
114 SCRA 273, it was held that
storage tanks installed on land
leased from Caltex are subject to
realty tax, they being
improvements on realty.
therefore considered real
property

In

BERKENKOTTER vs Cu Unjieng,
61 Phil 683, it was ruled that
machinery for breweries utilized
in the liquor or soft-drink
manufacturing, though movable
in nature, are immobilized by
destination being essential to
said industry.

In

Mindanao Bus Co. vs City

Assessor, 116 Phil 501, it was held
that machinery of a transportation
company such as welding, boring
machine, lathe machine sitting
on a cement platform which are
not essential to the transportation
business of the owner of the
tenement do not constitute realty.

EFFECT OF SEPARATION
If

the thing incorporated is temporarily removed

with the intention to replace the same, the thing is
considered as personal property because the
incorporation had ceased.
The material fact of incorporation or separation is
what determines the condition of the tenement, it
recovers its status as movables, irrespective of the
intention of the owner.

PARAGRAPH 4:

Statues, reliefs, paintings or other

objects for use or ornamentation,
placed in building or on land by the
owner of the immovable in such a
manner that it reveals the
intention to attach them
permanently to the tenements.
(Par 4. - These are immovables both
by incorporation and by
destination. )

Examples:

A fixed statue in the garden of

the house; a permanent painting
on the ceiling; a picture
embedded in the concrete walls
of a house; a rug or carpet
fastened to the floor (wall-to-wall
carpeting).

The objects must be placed by the

owner of the immovable
(buildings or lands) and not
necessarily the owner of the
object.

If placed by a mere tenant, the

objects must remain chattels or
personalty (See: Davao Sawmill
vs. Castillo, 61 Phil 709).

However, in Valdez vs. Central Altagracia,

255 U.S. 58), it was held that where the
owner of a tenement entered into a
contract with a lessee, stipulating that
the lessee shall place certain objects in
the property leased, and that such
objects shall remain with the property
upon the termination of the lease,
without any obligation on the part of the
owner to reimburse the lessee, the
tenant acts as an agent of the owner in
giving by contract a permanent
destination to them.

EFFECT OF SEPARATION
In Ago vs Court of Appeals, 6
SCRA 530, it was held that the
moment these objects are
separated from the land or
building or from the industry or
works, they regain back their
condition as personal property.

Paragraph 3 and 4 different from

paragraph 5.

PARAGRAPH 5:

Machinery, receptacles,
instruments, or implements
intended by the owner of the
tenement for an industry or works
which may be carried on in a
building or on a piece of land, and
which tend directly to meet the
needs of the said industry or works.
(These are immovables by purpose or
destination.)

Essential requisites:
1.

The placing must be made by the

owner of the tenement, his agent, or
duly authorized legal representative;

2.

The industry or works must be

carried on in the building or on the
land;

3.

The machines, etc. must tend

directly to meet the needs of said
industry, and not merely incidental.

In Mindanao Bus Co. vs City Assessor,

116 Phil 501, it was ruled that a
transportation business is not carried
on in a building or in the compound.

Cash

registers, typewriters, etc.

usually found and used in hotels,
restaurants, theaters, etc., are
merely incidentals, and should
not be considered immobilized by
destination for these business
can continue or carry on their
functions without these
equipments.

The

same applies to the repair or

service shop of the transportation
business because the vehicles
may be repaired or serviced in
another shop belonging to
another.

In

Berkenkotter vs Cu Unjieng, 61
Phil 663, the Supreme Court held:
Machinery intended by the owner
of any building or land for the use
in connection with any industry or
trade being carried on therein and
which are expressly adapted to
meet the requirements of such
trade, are considered as real
property.

If

the installation of the machinery and

equipment in question in the central converted
them into real property by reason of their purpose,
it cannot be said that their incorporation therewith
was not permanent in character because, as
essential and principal elements of a sugar
central, without them the sugar central would be
unable to function or carry on the industrial
purpose for which it was established.

The

new machinery must, therefore, be considered

as subject to the real estate mortgage in favor of
the defendant.


Effect of separation.
If

the machines are still in the building,

but no longer used in the industry
conducted therein, the machines revert to
the condition of a chattel. The moment
they are separated from the purpose of
the industry (not necessarily from the
immovable), they recover their (not
necessarily from the immovable), they
recover their condition as movables (see:
Ago vs Court of Appeals, 6 SCRA 530).
detached from the purpose not just from
the immovable

On the other hand, if still needed

for the industry, but separated
from the tenement temporarily,
the property continues to be
immovable, inasmuch as par. 5
refers not to real property by
incorporation, but to real
property by destination or
purpose.

PARAGRAPH 6:
Animal houses, pigeon-houses,
beehives, fishponds or
breeding places or similar
nature, in case their owner has
placed them or preserves them
with the intention to have them
permanently attached to the
land, and forming a permanent
part of it; the animals in these
places are included.

The

houses referred to here may

already be deemed included in
par. 1 when speaking of
constructions of all kinds
adhered to the soil.

Even if the animals are

temporarily outside, they may
still be considered as real
property as long as the intent to
return is present, as in case of a
homing pigeon.

But from the viewpoint of

criminal law, they are considered
as personal property and may
properly be the objects of theft
or robbery.

When the animals inside the

permanent animal houses are
alienated onerously or
gratuitously, the transaction is an
alienation of personal property,
unless the building or the
tenement itself is also alienated.

This

is because in said alienation,

the animal structures must of
necessity be detached from the
immovable. Hence an ordinary
inter-vivos donation of a pigeonhouse need not be in a public
instrument.

If

alienated : personal property

PARAGRAPH 7:
Fertilizers

actually used on a
piece of land.

Fertilizers

still in the barn and

even those already on the ground
but wrapped inside some
newspapers or any other
covering are still to be considered
personal property, for they have
not yet been actually used or
spread over the land.

The

fertilizers should be on the

land where they are to be
utilized, because it is only that
the intention of the owner to use
them on the tenement is beyond
doubt. Hence, fertilizers kept in
the farmhouse are not
immovable.

Benguet

v. CBAA(1/29/93)
mines trailings is subject to realty
tax.

PARAGRAPH 8:

Mines, quarries, and slag

dumps while the matter
thereof forms part of the bed,
and waters, either running or
stagnant.

Mines,

including the minerals still

attached thereto, are real
properties, but when the
minerals have been extracted,
the latter become chattels.

Slag

dump is the dirt and soil

taken from a mine and piled upon
the surface of the ground. Inside
the dump can be found the
minerals.

The

waters referred to are

those still attached to or running
thru the soil or ground. But the
water itself as distinguished
from waters is clearly personal
property.
On the other hand, canals, rivers,
lakes, and such part of the sea as
may be the object of
appropriation, are classified as
real property.

PARAGRAPH 9:
Docks and structures which,
though floating, are intended
by their nature and object to
remain at a fixed place on a
river, or coast.

Depends

on the intention
GR: immovable Except: travel
from place to place

floating house tied to a shore

or bank post and used as a
residence is considered real
property, considering that the
waters on which it floats, are
considered immovables.

In a way, we may say that the

classification of the accessory
(the floating house) follows the
classification of the principal (the
waters). However, if the floating
house makes it a point to travel
from place to place, it assumes
the category of a vessel.

By

express provision of Art. 585 of

the Code of Commerce, vessels
are movable property; but they
partake, to a certain extent, of the
nature and conditions of the
property, on account of their
value and importance in the world
of commerce. (see: Rubiso vs
Rivera, 37 Phil. 72).

Vessels

are considered personal

property. As a matter of fact, they
are indeed very movable. (see:
PRC vs Jarque, 61 Phil 229).

Because

they are personal

property, they may be the
subject of the chattel mortgage.
(see McMicking vs EspanolFilipino, 13 Phil 429; Arroyo vs Yu
de Sane, 54 Phil7).

Vessel

attached: immovable by
destination

Immovable by destination
intended for an industry which
can be carried on in a vessel

Fels energy vs. Province of Batangas

(Feb 16, power barges - The CBAA and
LBAA power barges are real property
and are thus subject to real property
tax. Moreover, Article 415 (9) of the
New Civil Code provides that [d]ocks
and structures which, though floating,
are intended by their nature and
object to remain at a fixed place on a
river, lake, or coast are considered
immovable property.

Thus, power barges are

categorized as immovable
property by destination, being in
the nature of machinery and
other implements intended by
the owner for an industry or work
which may be carried on in a
building or on a piece of land and
which tend directly to meet the
needs of said industry or work.

PARAGRAPH 10:

Contracts for public works,

and servitudes and other real
rights over immovable
property.

The properties referred to in this

paragraph are not material things
but rights, which are necessarily
intangible. The piece of paper on
which the contract for the public
works has been written is
necessarily personal property, but
the contract itself, or the right of
the contract is real property.

A servitude or easement is an
encumbrance imposed upon an
immovable for the benefit of
another immovable belonging to
a different owner, or for the
benefit of a person, group of
persons, or a community. [ex.
easement of right of way]

Other

real rights over real

property include real estate
mortgage, antichresis,
possessory retention, usufruct,
leases of real property, if
registered; or even if not
registered, if their duration is for
more than a year.

Usufruct

of personal property or a
lease of personal property, should
be considered personal property.
In the case of Presbitero vs.
Fernandez (March 30, 1958), the
Supreme Court held that sugar
quotas are real property, for they
are by law considered real rights
over immovable property just like
servitudes and easements.

In Cabutihan vs LCDC, 383 SCRA

353, it was held that actions
affecting title to or possession of
real property or an interest
therein shall be commenced and
tried in the proper court that has
territorial jurisdiction over the
area where the real property is
situated.

USUFRUCT
The holder of a usufruct, known as
the usufructuary, has the right to
use and enjoy the property, as
well as the right to receive profits
from the fruits of the property.

The

English word usufruct derives

from the Latin expressionusus et
fructus, meaning "use and
enjoyment", cognate to English
"use and fruits".

IN ALGEBRA
C=A+B
IN PROPERTY LAW
FULL OWNERSHIP = NAKED
OWNERSHIP +
USUFRUCT

Three Fundamental Rights

Appertaining to Ownership
Jus Disponendi (right to dispose)
2. Jus Utendi (right to use)
3. Jus Fruendi (right to the fruits)
1.

USUFRUCT
Combination

of jus utendi and

jus fruendi
The remaining right (jus
disponendi) is really the essence
of what is termed
naked ownership.

FORMULA
FULL OWNERSHIP = NAKED OWNERSHIP
+
USUFRUCT
NAKED OWNERSHIP = FULL OWNERSHIP USUFRUCT
USUFRUCT = FULL OWNERSHIP NAKED
OWNERSHIP

MOVABLE PROPERTY

Art.

416. The following things are

deemed to be personal property :

1.

Those movables susceptible of

appropriation which are not
included in the preceding article.

Examples:

ring; cars

cell phones; money;

2.)

Real property which by

any special provision of law is
considered as personalty.

Examples:

Growing crops for the

purpose of the Chattel Mortgage
Law (see: Sibal vs Valdez, 50 Phil.
512); machinery placed on a
tenement by a tenant, who did
not act as the agent of the
tenement owner (see: Davao
Sawmill vs. Castillo, 61 Phil. 709).

3)

Forces of nature which are

brought under control by
science.

Examples:

Electricity, gas, light,

nitrogen (see: US vs Carlos, 21
Phil. 543);

4)

In general, all things which

can be transported from
place to place without
impairment of the real
property to which they are
fixed.

Examples:

Machinery not
attached to land or needed for
the carrying on of an industry
conducted therein.

TEST TO DETERMINE
WHETHER PROPERTY IS
MOVABLE OR
IMMOVABLE:

a)

If the property is capable

of being carried from place to
place. (Test by description)

b)

If such change in location

can be made without injuring
the real property to which it
may in the meantime be
attached. (Test by
description)

c)

And if finally, the object is not

one of those enumerated or
included in Art. 415. (Test by
exclusion)

Then the inevitable conclusion is that

the property is personal property.

Note: Test by exclusion is superior to

test by description.

Art.

417. The following are

also considered as personal
property:

1.)
Obligations and actions
which have for their object
movables or demandable
sums.

REMINDERS
The

term obligations really

refers to credits and also
includes bonds, which are
technically obligations of the
entity issuing them;

Actions

if somebody steals my
car, my right to bring action to
recover the automobile is
personal property by itself; A
promissory note is a personal
property; the right to collect it is
also a personal property.

2)

Shares of stock of
agricultural, commercial and
industrial entities, although
they may have real estate.

Although

the provisions of par. 2

seem to refer only to
corporations by the words
shares of stocks, and only to
those engaged in agriculture,
commerce, and industry,
nevertheless, all juridical persons
must be deemed included.

share of stock in a gold mining

corporation is also personal property; but
the gold mine itself, and any land of the
corporation, are regarded as real property
by the law. The certificate evidencing
ownership of the share, and the share
itself, are regarded as personal property.
Being personal, they may be the object of
a chattel mortgage (see: Chua Guan vs.
Samahang Magsasaka, Inc. 62 Phil. 472)

half interest in drugstore

business is personal property
capable of being the subject of a
chattel mortgage (see:
Strochecher vs. Ramirez, 44 Phil.
933). However, a half-interest in a
drugstore, considered as a building
(not a business) is a real right in
real property and is therefore by
itself a real property.

In

Hongkong and Shanghai Bank

vs Aldecoa, 30 Phil 255, it was
held that real estate mortgages
are realty and not personalty.

Art.

418. Movable property is

either consumable or
nonconsumable. To the first
class belong those movables
which cannot be used in a
manner appropriate to their
nature without their being
consumed; to the second class
belong all the others. (337)

PROPERTY

IN RELATION TO
THE PERSON
TO WHOM IT BELONGS

Art.

419. Property is either of

public dominion or of private
ownership.


The

State may own properties

both in its public capacity (public
dominion) and private capacity
(patrimonial).

Public

dominion ownership by
the state in its public capacity or
in the exercise of its
governmental functions.

Patrimonial

ownership by the state in

its private capacity or in the course of its
proprietary functions. This is the property
over which the State has the same rights,
and for which it may dispose, to the same
extent as private individuals in relation to
their property, subject only to the
administrative laws and regulations on the
procedure of exercising such rights. They
exist for the State to attain its economic
ends, as a means for its subsistence, and
the preservation of its natural organism.

What are properties of

public dominion?

Art. 420. The following things

are property of public
dominion:
(1) Those intended for public use,
such as roads, canals, rivers,
torrents, ports and bridges
constructed by the State, banks,
shores, roadsteads, and others of
similar character;
(2) Those which belong to the
State, without being for public use,
and are intended for some public
service or for the development of
the national wealth.

Public

use
Public service

In

Usero vs CA, 353 SCRA 449, the SC

held that the phrase others of similar
character includes a creek which is a
recess or an arm of a river. It is
property belonging to the public
domain which is not susceptible to
private ownership. Being public
water, a creek cannot be registered
under the Torrens System in the name
of any individual.

CHARACTERISTICS:
1.

They may be real or personal;

2. They cannot be levied or attached; [Tan Toco vs Mun.
Council of Iloilo, 49 Phil 52];
3. They cannot be registered under the Land Registration
Law;
4. They cannot be acquired by prescription [Harty vs Mun.
of Victoria, 13 Phil. 152];
5. They are outside the commerce of man [Mun. Of Cavite
vs Rojas, 30 Phil 20];
6. They cannot be burdened by any voluntary easement.

 Property

for PUBLIC USE, defined :

It

can be used by everybody, even by

strangers or aliens in accordance with its
nature; but nobody can exercise over it the
rights of a private owner. Thus, no private
person can have a property right in the use
of a street for his private business, nor can
he acquire over such a right to possession as
would require the exercise of possessory
actions.

In

Republic vs. Gonzales, 199 SCRA

788, it was held that : the conception
urged by appellants to restrict property
reserved for public use to include only
property susceptible of being used by a
generally unlimited number of people
is flawed and obsolete, since the
number of the users is not the
yardstick in determining whether
property is properly reserved for public
use or benefit.

Property

for PUBLIC SERVICE This kind of property includes all

property devoted for public service.
In Baguio Citizens Action vs City
Council, 121 SCRA 368, it was held
that all public buildings constructed
by the State for its offices and
functionaries belong to this class.


QUESTION :
Are
rivers whether
navigable or not,
Answer
:
properties of public dominion?
It would seem that Art. 420 NCC,

makes no distinction.

However:
In

Palanca vs. Commonwealth, 40

OG 148, the Supreme Court said:
The river Viray and the estero
Sapang Sedoria, being navigable,
useful for commerce, for
navigation, and fishing, they have
the character of public domain.

In

Taleon vs. Secretary of Public

Works, L-24281, May 16, 1967, it
was held that if a river is
capable in its natural state of
being used for
commerce,
it is navigable in fact, and
therefore, becomes a public river.

In

Martinez vs Court of Appeals,

56 SRCA 647, it was held that
navigable rivers are outside the
commerce of man and therefore
cannot be registered under the
Land Registration Law. If converted
into fishponds, the latter can be
demolished notwithstanding the
title, for said title cannot convert
the streams into private ones.

In

Mercado vs Municipal
President of Macabebe, 59 Phil
592, it was ruled that creeks
which are mere extensions of
rivers are considered property of
public domain.

Art. 421. All other property of the

State, which is not of the character
stated in the preceding article, is
patrimonial property.

CONVERSION:
Art.

422. Property of public

dominion, when no longer
intended for public use or
for public service, shall form
part of the patrimonial
property of the state.

Declaration

pursuant to a law
by legislative or executive
ultimately legislativee

When change takes effect

Property of public dominion ceases to be such and
: becomes private property of the State only upon
declaration by the government, thru the legislative or
executive departments, to the effect that it is no
longer needed for public use or public service. If the
property has been intended for such use or service,
and the government has not devoted it to other uses,
or adopted any measure which amounted to a
withdrawal thereof from public use or service, the
same remains property for public use or service
notwithstanding the fact that it is not actually
devoted for public use or service. (See: Capitulo, et.
Al. vs Aquino 53 OG1477)

 In

the case of Faustino vs Dir. Of Lands, L12958, May 30, 1960, the Supreme Court,
(citing Natividad vs. Dir. Of Lands, CA 37 OG
2905 said that only the executive and possibly
the legislative departments have the authority
and power to make the declaration that any
land so gained by the sea is not necessary for
purposes of public utility, or for the
establishment of special industries. If no such
declaration has been made by the said
departments, the lot in question forms part of
the public domain.

Who shall declare?

Consequently,

until there is made

a formal declaration on the part
of the government thru the
executive department or the
legislature, the parcel in question
continues to be part of the public
domain and cannot be subject to
acquisitive prescription.

In

Laurel vs Garcia, 187 SCRA 799,

the Supreme Court said : It is not
for the President to convey
valuable real property of the
government on his or her own sole
will. Any such conveyance must be
authorized and approved by law
enacted by Congress. It requires
executive and legislative
concurrence.

Art.

423. The property of

provinces, cities, and
municipalities is divided into
property for public use and
patrimonial property.

 Art.

424. Property for public use, in the

provinces, cities, and municipalities,
consist of the provincial roads, city
streets, municipal streets, the squares,
fountains, public waters, promenades,
and public works for public service paid
for by said provinces, cities, or
municipalities.
All other property possessed by any of
them is patrimonial and shall be
governed by this Code, without prejudice
to the provisions of special laws.

Art.

425. Property of private

ownership, besides the
patrimonial property of the
State, provinces, cities, and
municipalities, consists of all
property belonging to private
persons, either individually or
collectively.

 Art.

426. Whenever by provision of the

law, or an individual declaration, the
expression "immovable things or
property," or "movable things or
property," is used, it shall be deemed to
include, respectively, the things
enumerated in Chapter 1 and Chapter
2.

 Whenever

the word "muebles," or

"furniture," is used alone, it shall not be
deemed to include money, credits,
commercial securities, stocks and bonds,
jewelry, scientific or artistic collections,
books, medals, arms, clothing, horses or
carriages and their accessories, grains,
liquids and merchandise, or other things
which do not have as their principal object
the furnishing or ornamenting of a building,
except where from the context of the law,
or the individual declaration, the contrary
clearly appears.

OWNERSHIP
Art.

IN GENERAL

427. Ownership may be

exercised over things or
rights.

Art.

428. The owner has the

right to enjoy and dispose of
a thing, without other
limitations than those
established by law.
The owner has also a right of
action against the holder and
possessor of the thing in
order to recover it.

person has the right to control

a thing particularly in his
possession, enjoyment,
disposition, and recovery, subject
to no restriction except those
imposed by the law.

 Right

to Enjoy :
In Marcos vs Endencia, 38 O.G. 855, it was
ruled that the right to enjoy consists not
only in the right to collect the rents or fruits,
in short, the benefits which accrue from the
thing, but also in the right to use and utilize
the same according to its natural destination
and in the right, besides, to make the thing
serve ones necessities, ones pleasures, and
even, within the letter and spirit of the law,
personal whims.

QUESTION

:
If a land has been foreclosed by
the mortgagee, does the
mortgagor still have the right to
enjoy his foreclosed property?

YES,

but only during the

period of redemption.
In GSIS vs CA, 377 SCRA 54, it
was held that the mortgagor has
the right to redeem his property,
possession, use and enjoyment of
the same during the period of
redemption.

LIMITATIONS

ON OWNERSHIP

1.

Imposed by law :
- Easement of right of way; party
wall; drainage.

2.

Imposed by state :

Police power;
- Power of taxation;
- Power of eminent domain.
-

3.

Imposed by owner :
- in cases of lease, the owner
cannot in the meantime
physically occupy the property;
(also pledges).

4.

Imposed by grantor :
- The donor may prohibit the
donee from partitioning the
property for a period not
exceeding 20 years.

SELF-HELP
,
doctrine
of
:
Art. 429. The owner or lawful
possessor of a thing has the right to
exclude any person from enjoyment
and disposal thereof. For this
purpose, he may use such force as
may be reasonably necessary to repel
or prevent an actual or threatened
unlawful physical invasion or
usurpation of his property.

An

act impelled
byfrom Art. 227
This article
was taken
legitimate
necessity
shall
of the German Civil Code which
not be unlawful.
provides:
Legitimate necessity
consists in the defense
indispensable to repel,
personally or thru another,
an actual or unjust
situation.

It

is lawful toof
repel
force by means
Principle
self-help
:
of force. It implies that the state of
things to be defended enjoys
juridical protection.
It

is sort of self-defense, where the

use of such necessary force to
protect proprietary or possessory
rights constitutes a justifying
circumstance under the Penal Code.

The actual invasion of

property may be:
a.

Mere disturbance of
possession force may be used
against it at any time as long as it
continues, even beyond the
prescriptive period for an action of
forcible entry. Thus if a ditch
opened by Pedro in the land of
Juan, the latter may close it or
cover it by force at any time.

b.

Real dispossession force,

to regain possession can only be
used immediately after the
dispossession. Thus, if Juan
without the permission of Pedro,
picks up a book belonging to the
latter and runs off with it, Pedro
can pursue Juan and recover the
book by force.

In

German Management &

Services, Inc. vs CA, 177 SCRA
495, it was held that the doctrine
of self-help can only be exercised
at the time of actual or threatened
dispossession. When possession
had already been lost, the owner
must resort to judicial process for
the recovery of property.

Nature of the aggression:

The

aggression must be illicit or

unlawful. The right to self-help is
not available against the exercise
of right by another, such as when
the latter executes an extrajudicial abatement of nuisance.
Neither can it be used against the
lawful exercise of the functions of a
public official, such as a sheriff
attaching property.

Art.

430. Every owner may

enclose or fence his land or
tenements by means of walls,
ditches, live or dead hedges,
or by any other means
without detriment to
servitudes constituted
thereon.

Art.

431. The owner of a

thing cannot make use
thereof in such manner as to
injure the rights of a third
person.

432.IN
theA
owner
of a thing
ACTS
STATE
OF has
no right to prohibit the interference
NECESSITY
,
doctrine
of
:
of another with the same, if the

interference
is necessary to avert

Art.

an imminent danger and the

threatened damage, compared to
the damage arising to the owner
from the interference, is much
greater. The owner may demand
from the person benefited
indemnity for the damage to him.

This

following the
Therearticle,
is obligation
to same
principle of self-help contained in
indemnity.
the second part of Article 429,
432
superior
todefensive
429. force to
allows
the use of
preserve an existing situation, as

against an external event which the

passive subject is entitled to repel
as much as an unlawful aggression
by another.

Examples

of danger contemplated by this

article are the attack of animals, the
spread of fire, the threat of flood, etc. The
attacking animal, belonging to another
may be killed by the victim; a house in the
path of a fire may be demolished; and a
dike may be destroyed at one point to
prevent a flood over other places. The law
permits the injury or destruction of things
belonging to other provided this is
necessary to avert a greater danger.

Requisites:
1.)

Existence of an evil sought to be

avoided;
2.) The injury feared is greater than
that done to avoid it;
3.) That there be no other practical
and less harmful means of preventing
it;
4.) The means employed is necessary
and indispensable to avert danger.

Effect

of mistake the right to act

in a state of necessity depends upon
the objective existence of the danger
with the requisites provided by law. If
through error, one believed himself to
be in a state of necessity, or used
means in excess of the requirements,
his act would be illicit and the owner
of the property used against him the
defensive force authorized in Art. 429.

Effect

of negligence The law does

not require that the person acting in a
state of necessity be free from
negligence in the creation of such
situation. Thus, if a person picks up an
unknown object in a drug store and eats
it, thinking it to be candy, and it turns
out to be poison, he can lawfully drink
any antidote he may find in the store,
even without the consent of the owner.

Basis

of liability The obligation

to indemnity does not depend
upon imputability. The basis of the
liability is the benefit derived.

Conflict of rights The right of

self-help under Article 429 is not
available against an act in a state
of necessity.

Art.

433. Actual possession

under claim of ownership
raises disputable
presumption of ownership.
The true owner must resort
to judicial process for the
recovery of the property.

Art.

434. In an action to
recover, the property must be
identified, and the plaintiff
must rely on the strength of
his title and not on the
weakness of the defendant's
claim.

JUST COMPENSATION,
Art. 435. No person shall be deprived of
concept
of :
his property except by competent
authority and for public use and always
upon payment of just compensation.
Should this requirement be not first
complied with, the courts shall protect
and, in a proper case, restore the
owner in his possession.

Just

compensation The fair

and full equivalent for the loss
sustained (Mla. Railroad vs.
Velasquez, 32 Phil 286).

QUESTION

:
May real property be subjected
to an easement of right of way
through expropriation?

In

Republic vs PLDT, 26 SCRA 620, the

SC ruled that normally, expropriation
deals with a transfer of title or
ownership; there is nothing wrong,
therefore, in imposing a burden less
than the transfer of ownership. It is
unquestionable that real property may
through expropriation be subjected to
an easement of right of way.

QUESTION

:
In the event that the purpose of
the expropriation is abandoned
or withdrawn, is the previous
owner entitled to reacquire the
property?


In

Fery vs Municipality of
Cabanatuan, 42 Phil 28, the SC
ruled that if the decree granted full
ownership to the petitioner, the
latter remains the owner regardless
of the disappearance or cessation
of the public need for the property.

If

the grant of ownership or title

is subject to the condition that it
will revert to the owner when the
purpose of the expropriation is
terminated or abandoned, the
original owner of the property
would reacquire the property.

Art.

436. When any property

is condemned or seized by
competent authority in the
interest of health, safety or
security, the owner thereof
shall not be entitled to
compensation, unless he can
show that such condemnation
or seizure is unjustified.

 Art.

437. The owner of a parcel of land

is the owner of its surface and of
everything under it, and he can
construct thereon any works or make
any plantations and excavations which
he may deem proper, without detriment
to servitudes and subject to special
laws and ordinances. He cannot
complain of the reasonable
requirements of aerial navigation.

 Art.

438. Hidden treasure belongs to the

owner of the land, building, or other
property on which it is found.
Nevertheless, when the discovery is made
on the property of another, or of the State
or any of its subdivisions, and by chance,
one-half thereof shall be allowed to the
finder. If the finder is a trespasser, he shall
not be entitled to any share of the treasure.
If the things found be of interest to science
of the arts, the State may acquire them at
their just price, which shall be divided in
conformity with the rule stated.

Art.

439. By treasure is
understood, for legal
purposes, any hidden and
unknown deposit of money,
jewelry, or other precious
objects, the lawful ownership
of which does not appear.


RIGHT
OF ACCESSION
Art

440. The ownership of

property gives the right by
accession to everything which
is produced thereby, or which
is incorporated or attached
thereto, either naturally or
artificially.

Accession, meaning of :

The

right of a property owner to

everything which is produced
thereby or which is incorporated
or attached thereto.

To

the owner of the principal

belongs the accessory.

Art.

441. To the owner

belongs:
(1) The natural fruits;
(2) The industrial fruits;
(3) The civil fruits.

 Art.

442. Natural fruits are the

spontaneous products of the soil, and
the young and other products of
animals.
Industrial fruits are those produced by
lands of any kind through cultivation or
labor.
Civil fruits are the rents of buildings,
the price of leases of lands and other
property and the amount of perpetual
or life annuities or other similar
income.

Art.

443. He who receives the

fruits has the obligation to
pay the expenses made by a
third person in their
production, gathering, and
preservation.

Art.

444. Only such as are

manifest or born are
considered as natural or
industrial fruits.
With respect to animals, it is
sufficient that they are in the
womb of the mother,
although unborn.

Instances when the owner of

REMINDER
:
land does not own the fruits:

1.

Possessor in good faith of

the land. (He owns the fruits
already received.) (see : Art
544, par 1)

Art.

544. A possessor in good

faith is entitled to the fruits
received before the
possession is legally
interrupted.

2.

Usufruct. The usufructuary

owns the fruits. (see Art 566)

Art.

566. The usufructuary

shall be entitled to all the
natural, industrial and civil
fruits of the property in
usufruct. With respect to
hidden treasure which may
be found on the land or
tenement, he shall be
considered a stranger.

3.

Lease. The lessee gets the

fruits of the land. (Of course,
the owner gets the civil fruits
in the form of rentals.) see
Art. 1654

Art.

1654. The lessor is obliged:

(1) To deliver the thing which is the
object of the contract in such a
condition as to render it fit for the
use intended;
(2) To make on the same during the
lease all the necessary repairs in
order to keep it suitable for the
use to which it has been devoted,
unless there is a stipulation to the
contrary;

(3)

To maintain the lessee in

the peaceful and adequate
enjoyment of the lease for
the entire duration of the
contract. (1554a)

4.

In antichresis, the
antichretic creditor gets the
fruits, although said fruits
should be applied first to the
interest, if any is owing; and
then to the principal amount
of the loan. (see : Art. 2132)

Art.

2132. By the contract of

antichresis the creditor
acquires the right to receive
the fruits of an immovable of
his debtor, with the obligation
to apply them to the payment
of the interest, if owing, and
thereafter to the principal of
his credit.

RIGHT

OF ACCESSION WITH
RESPECT
TO IMMOVABLE PROPERTY

GEN. RULE :

Art.

445. Whatever is built,

planted or sown on the land
of another and the
improvements or repairs
made thereon, belong to the
owner of the land, subject to
the provisions of the
following articles.

To

the owner of the principal

(land for example) must belong
also the accessions in
accordance with the principle
that the accessory follows the
principal.

NOTE

: This article deals

with accession continua more
specifically accession
industrial BUILDING,
PLANTING, SOWING.

Exception

: Art. 120 of the

Family Code.

building constructed on the

land owned by one of the
spouses at the expense of the
conjugal partnership will belong
to the partnership or to the
spouse who owns the land
depending on which of the two
properties has a higher value.

If

the land is more valuable than

the building, the building shall be
owned by the owner of the land.

If

the building is more valuable

than the land, the entire property
shall belong to the conjugal
partnership.
In both cases, there is right of
reimbursement at the time of
liquidation of the conjugal
partnership.

Art.

446. All works, sowing,

and planting are presumed
made by the owner and at his
expense, unless the contrary
is proved.

RIGHTS

OF THE LANDOWNER

 Art.

447. The owner of the land who makes

thereon personally or thru another, plantings,
constructions or works with the materials of
another shall pay their value; and if he acted
in bad faith, he shall also be obliged to the
reparation of damages. The owner of the
materials shall have the right to remove them
only in case he can do so without injury to the
work constructed, or without the plantings,
constructions or works being destroyed.
However, if the landowner acted in bad faith,
the owner of the materials may remove them
in any event, with a right to be indemnified
for damages.

Option

always exercised by
landowner.

Note :

There is no provision of law which

applies to a situation where the
landowner is in good faith while the
owner of the material is in bad faith.

However,

it would seem that the

landowner would not only be
exempted from reimbursement, but
would also be entitled to consequential
damages (as when for instance, the
materials are of inferior quality).
Moreover, the owner of the materials
would lose all rights to them , such as
the right of removal, regardless of
whether substantial injury would be
caused.

REMINDERS

Under

Art. 447. The landowner

himself (as distinguished from
Art. 448) makes the PLANTINGS,
CONSTRUCTIONS OR WORKS on
his land, BUT with the materials
of another person.

In

such a situation, a NEW THING

is produced (i.e. something that is
built or constructed on a land by
the landowner with the materials
of another), but does not result in
co-ownership. The owner
therefore of the materials does not
become part owner of the new
thing. He is only entitled to
recover their value.

In

short, the law gives the

LANDOWNER, who acted in good
faith, the right to APPROPRIATE
the new thing provided that he
INDEMNIFIES the owner of the
materials.

QUESTION

:
What if the landowner offers to
dismantle the new thing and
return the materials thereof to its
owner?

Answer

:
Strictly speaking, the law does
not grant this option. What the
law provides is the right (of the
landowner) to pay for the value
of the materials.

However,

when the materials can

be removed without causing
injury thereof (i.e. statues,
ornaments or other of like
nature), or when the materials
had not been transformed, the
landowner may return them at
his expense to the owner of the
materials.

QUESTION

:
What if the new thing is
dismantled, is the right of the
owner of the materials revived?

Answer

:
It would seem that the law
attributes ownership to the
landowner by giving them the
option to pay for their value,
hence, the right of the owner of
the materials is not revived.

However,

the better rule should

be that as long as there is no
injury to the work constructed or
to the planting, the same may be
recovered by the owner thereof.

REMINDER :
In

case of alienation by the

landowner, the owner of the
materials may go against the new
owner, because he is the one
benefited by the accession. (Pacific
Farms vs Esguerra 30 SCRA 684)

Bad Faith; Good Faith, meaning

of (Cf. Arts. 453 and 526).

 Art.

453. If there was bad faith, not

only on the part of the person who
built, planted or sowed on the land of
another, but also on the part of the
owner of such land, the rights of one
and the other shall be the same as
though both had acted in good faith.
It is understood that there is bad faith
on the part of the landowner whenever
the act was done with his knowledge
and without opposition on his part.

 Art.

526. He is deemed a possessor in

good faith who is not aware that there
exists in his title or mode of acquisition
any flaw which invalidates it.
He is deemed a possessor in bad faith
who possesses in any case contrary to
the foregoing.
Mistake upon a doubtful or difficult
question of law may be the basis of
good faith.

The

builder, planter or sower is in

bad faith if he makes use of the
land or materials which he knows
belong to another.

Art. 448. The owner of the land on which anything

has been built, sown or planted in good faith, shall
have the right to appropriate as his own the works,
sowing or planting, after payment of the indemnity
provided for in Article 546 and 548 or to oblige the
one who built or planted to pay the price of the
land, and one who sowed, the proper rent.

However, the builder or planter cannot be obliged to

buy the land if its value is considerably more than
that of the building or trees. In such case, he shall
pay reasonable rent if the owner of the land does
not chose to appropriate the building or trees after
indemnity. The parties shall agree upon the terms
of the lease and in case of disagreement, the court
shall fix the terms thereof.

Note

: This article applies only if

the builder, planter or sower is in
good faith. (See also Arts. 454
and 447.)

Art.

454. When the landowner

acted in bad faith and the builder,
planter or sower proceeded in
good faith, the provisions of
article 447 shall apply.

Applicability of Art. 448.

In

PECSON VS COURT OF APPEALS, 244 SCRA

407, it was held that Article 448 applies only to
a land whose ownership is claimed by two or
more parties, one of whom has built some works,
one sown or planted something. It does not
apply to a case where the owner of the land is
the builder, sower or planter who then later loses
ownership of the land by sale or donation.
Nevertheless, the provision therein with respect
to indemnity may be applied by analogy
considering that the primary intent of Art. 448 is
to avoid a state of forced co-ownership.

Who

is entitled to possession
of the building if the
landowner opts to
appropriate the building?

In

Pecson [supra], the SC further

held : Since the landowner opted to
appropriate the apartment building,
the owner of the building is thus
entitled to the possession and
enjoyment of the apartment building,
until he is paid the proper indemnity,
as well as of the portion of the lot
where the building was constructed.

This

is so, because the right to retain

the improvements while the
corresponding indemnity is not paid
implies the tenancy or possession in
fact of the land which it is built, planted
or sown. The petitioner not having
been so paid, he was entitled to retain
ownership of the building, and,
necessarily, the income therefrom. [Cf :
Mendoza vs de Guzman, 54 SCRA 164]

What is the basis of

reimbursement, cost of
the building or the
market value of the
building?

Again,

in Pecson [supra], it was held

that the objective of Art. 546 of the
Civil Code is to administer justice
between the parties involved in such a
way as neither one nor the other may
enrich himself of that which does not
belong to him. It is therefore the
current market value of the
improvement which should be made
the basis of reimbursement.

contrary ruling would unjustly

enrich the private respondents
who would otherwise be allowed
to acquire a highly valued
income-yielding four-unit
apartment building for a measly
amount.

QUESTION

:
May a lessee or a tenant who
introduced improvements on a
rented land recover for their
value under Art. 448?

In Balucanag vs Francisco,
122 SCRA 498, in rel. to
Art 448 does not apply to a lessee because
Rivera
vs Trinidad, 48 Phil
as such lessee he knows that he is not the
owner
of the
leased
premises.
396,
the
SC
ruled
: Neither can

he deny the ownership or title of his lessor. A

lessee who introduces improvements in the
leased premises, does so at his own risk in
the sense that he cannot recover their value
from the lessor, much less retain the
premises until such reimbursement.

Also,

in CHUA vs COURT OF
APPEALS, 301 SCRA 358, it was held
that : the fact that petitioners
made repairs on the premises is not
a reason to retain the possession of
the premises. There is no provision
of law which grants the lessee a
right of retention over the leased
premises on that ground.