Property: Immovable and Movable Case Doctrines

I. IMMOVABLE PROPERTY

REAL PROPERTY UNDER PAR NO. 1; LANDS, BUILDINGS, ROADS AND CONSTRUCTIONS OF ALL
KINDS ADHERING TO THE SOIL

A BUILDING IS ALWAYS IMMOVABLE

Lopez v. Orosa

Building is separate and distinct from land

While it is true that generally, real estate connotes the land and the building constructed thereon, it is
obvious that the inclusion of the building, separate and distinct from the land, in the enumeration of what
may constitute real properties could mean only one thing that a building is by itself an immovable
property (cf. Leung Yee v. Strong Machinery). In the absence of any specific provision of law to the
contrary, a building is an immovable property, irrespective of whether or not said structure and the land
on which it is adhered to belong to the same owner.

Prudential Bank v. Panis

Building separate and distinct from the land

In the enumeration of properties under Article 415 of the Civil Code of the Philippines, it is obvious that
the inclusion of 'building' separate and distinct from the land, in said provision of law can only mean that a
building is by itself an immovable property.

Leung Yee v. Strong Machinery

Building separate from land does not affect character as real property; Registry of chattel
mortgage does not affect character of the building and the machineries installed therein
The Chattel Mortgage Law contemplates and makes provision for mortgages of personal property; and
the sole purpose and object of the chattel mortgage registry is to provide for the registry of "Chattel
mortgages," mortgages of personal property executed in the manner and form prescribed in the statute.
The building of strong materials in which the machinery was installed was real property, and the mere
fact that the parties seem to have dealt with it separate and apart from the land on which it stood in no
wise changed its character as real property. It follows that neither the original registry in the chattel
mortgage registry of the instrument purporting to be a chattel mortgage of the building and the machinery
installed therein, nor the annotation in that registry of the sale of the mortgaged property, had any effect
whatever so far as the building was concerned.

BUILDING IS IMMOVABLE BY INCORPORATION

Bicerra v. Teneza

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

BUILDING ON RENTED LAND IS STILL IMMOVABLE

Evangelista v. Alto Surety

House is not personal, but immovable property

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

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

INSTANCES WHERE BUILDING IS TREATED AS PERSONAL BY THE PARTIES

GENERAL TEST, OF MOVABLE CHARACTER

Stadard Oil v. Jamarillo

Jaramillo, register of deeds, does not have judicial or quasi-judicial power to determine nature of
document registered as chattel mortgage
Section 198 of the Administrative Code, originally of Section 15 of the Chattel Mortgage Law (Act 1508 as
amended by Act 2496), does not confer upon the register of deeds any authority whatever in respect to
the "qualification," as the term is used in Spanish law, of chattel mortgages. His duties in respect to such
instruments are ministerial only. The efficacy of the act of recording a chattel mortgage consists in the
fact that it operates as constructive notice of the existence of the contract, and the legal effects of the
contract must be discovered in the instrument itself in relation with the fact of notice. Registration adds
nothing to the instrument, considered as a source of title, and affects nobody's rights except as a species
of notice. Thus, it is duty for the register of deed to accept the proper fee and place the instrument on
record, as his duties in respect to the registration of chattel mortgages are of a purely ministerial
character; and no provision of law can be cited which confers upon him any judicial or quasi-judicial
power to determine the nature of any document of which registration is sought as a chattel mortgage.
It may be noted that in an administrative ruling by James Ostrand, Judge of the fourth branch of CFI
Manila (9th Judicial District) and later Supreme Court Justice, provided the same position that the
Register of Deeds has no authority to pass upon the capacity of the parties to a chattel mortgage which is
presented to him for record. The issue where the chattel mortgage is held ineffective against third parties
as the mortgaged property is real instead of personal is a question determine by the courts of justice and
mot by the register of deeds.

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

CONSTRUCTION OF ALL KINDS ADHERED TO THE SOIL

Board of Assessment Appeals v. City Treasurer

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

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

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

TREES AND PLANTS

Sibal v. Valdez

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

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

MANNER

ATTACHMENT MUST BE IN A FIXED MANNER

Board of Assessment Appeals v. City Treasurer

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

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

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

IMPLEMENTS

THEY MUST BE DESTINED FOR USE IN THE INDUSTRY OR WORK

MOVABLES MUST BE PLACED BY THE OWNER

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

Davao Sawmill v. Castillo

Movables must be placed by the owner

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

Immobilization of machinery; when placed in plant by owner

Machinery which is movable in its nature only becomes immobilized when placed in a plant by the owner
of the property or plant, but not when so placed by a tenant, a usufructuary, or any person having only a
temporary right, unless such person acted as the agent of the owner. The distinction rests upon the fact
that one only having a temporary right to the possession or enjoyment of property is not presumed by the
law to have applied movable property belonging to him so as to deprive him of it by causing it by an act of
immobilization to become the property of another.

APPLICATION OF THE PRINCIPLE OF ESTOPPEL

Sergs Products v. PCI Leasing

Machinery immovable properties by incorporation

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

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

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

REAL PROPERTY UNDER NO. 10

Hongkong & Shanghai Banking v. Aldecoa & Co.

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

CONCEPT OF REAL PROPERTY IN REAL PROPERTY TAXES

Meralco vs CBAA

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

II. MOVABLE PROPERTY

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

Involuntary insolvency of Paul Strochecker v. Ramirez

Interest in business may be subject of mortgage

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

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

Sibal v. Valdez

Chattel Mortgage Law recognizes growing crops as personal property

Act 1508, the Chattel Mortgage Law, fully recognizes that growing crops are personal property. Section 2
of said Act provides that "All personal property shall be subject to mortgage, agreeably to the provisions
of this Act, and a mortgage executed in pursuance thereof shall be termed a chattel mortgage." Section 7
in part provides that "If growing crops be mortgaged the mortgage may contain an agreement stipulating
that the mortgagor binds himself properly to tend. care for and protect the crop while growing." The above
provisions of Act 1508 were enacted on the assumption that "growing crops" are personal property.

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

US v. Carlos

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

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

Philippine Refining v. Jarque

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

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

Chua Guan v. Samahang Magsasaka

A share of stock in a gold mining corporation is personal property; bu the gold mine itself, as well as any
land of the corporation, is regarded as real
property by the law. The certificate itself evidencing the ownership of the share, as well as the share
itself, is regarded as personal property. Being personal it can be subject of chattel mortgage.

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

PUBLIC DOMINION AND PRIVATE OWNERSHIP

Republic v. CA

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

public dominion
Property, which includes parcels of land found in Philippine territory, is either of public dominion or of
private ownership. Public lands, or those of public dominion, have been described as those which, under
existing legislation are not the subject of private ownership, and are reserved for public purposes. The
New Civil Code enumerates properties of public dominion in Articles 420 and 502 thereof. Article 420
includes those intended for public use, such as roads, canals, rivers, torrents, ports and bridges
constructed by the State, banks, shores, roadsteads, and others of similar character; and those
which belong to the State without being for public use, and are intended for some public service
or for the development of the national wealth" as property belonging to public dominion. Article
502 adds "rivers and their natural beds; continuous or intermittent waters of springs and brooks running
in their natural beds and the beds themselves; waters rising continuously or intermittently on lands of
public dominion; and lakes and lagoons formed by Nature on public lands and their beds; to the
enumeration.

Extent of a lake bed

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

Highest Ordinary Depth in a lake; Determinant is rainfall and not gravitational pull (tides)
The phrase "highest ordinary depth" has been interpreted in the case of Government. vs. Colegio de San
Jose to be the highest depth of the waters of Laguna de Bay during the dry season, such depth being the
"regular, common, natural, which occurs always or most of the time during the year; or thus rain "falling
directly on or flowing into Laguna de Bay from different sources." While the waters of a lake are also
subject to the same gravitational forces that cause the formation of tides in seas and oceans, this
phenomenon is not a regular daily occurrence in the case of lakes. The alternation of high tides and low
tides, which is an ordinary occurrence, could hardly account for the rise in the water level of the Laguna
de Bay as observed 4-5 months a year during the rainy season; rather, it is the rains which bring about
the inundation of a portion of the land in question. Since the rise in the water level which causes the
submersion of the land occurs during a shorter period than the level of the water at which the land is
completely dry, the latter should be considered as the "highest ordinary depth" of Laguna de Bay. The
land sought to be registered, therefore, is not part of the bed or basin of Laguna de Bay.

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

Purpose of land registration under Torrens System

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

Tax declaration strong evidence of ownership acquired by prescription; also Open, continuous,
public, peaceful, exclusive and adverse possession of the land
Applicant presents tax declarations covering the land since 1918 and also tax receipts dating back to
1948. While it is true that by themselves tax receipts and declarations of ownership for taxation purposes
are not incontrovertible evidence of ownership, they become strong evidence of ownership acquired by
prescription when accompanied by proof of actual possession of the property. Further, applicant by
himself and through his father before him, has been in open, continuous, public, peaceful, exclusive and
adverse possession of the disputed land for more than 30 years, counted from 19 April 1909, when the
land was acquired from a third person by purchase. Since applicant has possessed the subject parcel in
the concept of owner with just title and in good faith, his possession need only last for ten years in order
for ordinary acquisitive prescription to set in. Applicant has more than satisfied this legal requirement.

Judicial confirmation of imperfect title

Even if the land sought to be registered is public land, applicant would be entitled to a judicial
confirmation of his imperfect title, since he has also satisfied the requirements of the Public Land Act (CA
141 as amended by RA 1942). Section 48 of the Act enumerates as among the persons entitled to
judicial confirmation of imperfect title, such as those who, by themselves or through their predecessors-
in-interest, have been in the open, continuous, exclusive, and notorious possession and occupation of
agricultural lands of the public domain, under bona fide claim of ownership, for at least thirty years
immediately preceding the filing of the application for confirmation of title."
Reclamation requires proper permission; reclaimed land does not automatically belong to party
reclaiming the same
Private persons cannot, by themselves reclaim land from water bodies belonging to the public domain
without proper permission from government authorities. And even if such reclamation had been
authorized, the reclaimed land does not automatically belong to the party reclaiming the same as they
may still be subject to the terms of the authority earlier granted. In the present case, private oppositors-
petitioners failed to show proper authority for the alleged reclamation, therefore, their claimed title to the
litigated parcel must fall.

Tolerance of possession cannot ripen into ownership

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

CHARACTERISTICS OF PROPERTIES OF PUBLIC DOMINION.

Vda. De Tantoco v. Muncipal Council of Iloilo

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

CONVERSION OF PROPERTY OF PUBLIC DOMINION TO PATRIMONIAL PROPERTY.

Cebu Oxygen & Acetylene v. Bercilles

Street withdrawn from public use becomes patrimonial property; Subsequent sale valid
When a portion of the city street was withdrawn from public use, such withdrawn portion becomes
patrimonial property which can be the object of an ordinary contract. As expressly provided by Article 422
of the Civil Code, "property of public dominion, when no longer intended for public use or for public
service, shall form part of the patrimonial property of the State." Further, the Revised Charter of the City
of Cebu, in very clear and unequivocal terms, states that "property thus withdrawn from public servitude
may be used or conveyed for any purpose for which other real property belonging to the City may be
lawfully used or conveyed." Thus, the withdrawal of the property in question from public use and its
subsequent sale to the petitioner is valid.