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# 35: Tayag vs Yuseco G.R. No. L-8139 October 24, 1955

BELEN UY TAYAG and JESUS B. TAYAG, petitioners,
vs.
ROSARIO YUSECO, JOAQUIN C. YUSECO and THE COURT OF APPEALS, respondents.

FACTS: Before 1930, Atty. Yuseco had been rendering professional services to Maria Lim, owner of Lots 11-A
and 11-B of Hacienda de San Lazaro. To show her appreciation of the services rendered to her, she offered the
two lots to the Spouses Yuseco, who then built a house and an annex for servants quarters, valued at 50k. Atty.
Yuseco contends that the two lots were donated to him, yet there was no evidence of said donation; the certificates
of title of the lots remained in the name of Maria (however there was reason to believe that Maria Lim intended
to have the Yusecos occupy the land for free during her lifetime, as long as she remained the owner of the lots).
To go through formalities and legalize the possession of the lots a lease contract was executed stipulating that
the lease was to run for 5 years, with a rental of P120 per year; Maria Lim was to pay all land taxes and non-
payment of the rent would be sufficient cause to rescind the contract. Said agreement was noted on the Certificate
of Title.

Maria Lim sold the lots in question to her daughter, herein petitioner Belen-Tayag for the consideration of the
sum of P4,000. Petitioners as new owners asked the Spouses Yuseco to remove their housed or else pay the 120
peso- monthly rent. Failing to comply with the demand, an action of ejectment was filed by Petitioners against
the Sps Yuseco in the Municipal Court of Manila, which ruled in favor of the petitioners. On appeal to the CFI of
Manila held Tayag to be entitled to the possession of the lots in question upon payment by her to the Yusecos of
P50,000; if she does not pay within 90 days, the Yusecos will be entitled to purchase the lots for the sum of
P10,000 within 90 days from the date Tayag fails to buy the house.

On appeal to the CA, the CA found that the Yusecos were builders in good faith under article 448, as such, they
cannot be required to remove their house& annex unless they are paid its value; the Yusecos will only begin to
pay rent when the Tayags, as owners of the land, are unable or choose not to exercise their rights under Art 448

ISSUE:
(1)WON THE YUSECOS ARE BUILDERS IN GOOD FAITH

(2)WON ART 448 OF THE NEW CIVIL CODE OR ART 361 OF THE OLD CIVIL CODE APPLIES
IN THE PRESENT CASE

HELD:

(1) Yes. The court was of the opinion that the Yusecos constructed the above-mentioned improvements in the
mistaken belief that the lots in question were given to them for free. The Lease Contract was a mere
formality to legalize their occupation. Maria Lim intended for the Yusecos to occupy the said lots for free
as long as she kept the title(since 1930 the Yusecos paid no rent), and this arrangement was known to
Belen Tayag as she only demanded rent only from 1946, a year after the land was transferred to her.

(2) Art 361 of the old civil code applies. The new civil code became effective in 1950. The construction in
good faith was effected in 1930. Thus-

Art. 361. The owner of land on which anything has been built, sown, or planted in good
faith, shall be entitled to appropriate the things so built, sown or planted, upon paying the
compensation mentioned in Article 453 and 454, or to compel the person who has built or
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Case Notes for Property Law, PSU LAW 1 Sem AY 2017-2018 |2

planted to pay him the value of the land, and the person who sowed thereon to pay the
proper rent therefor.

It is up to the parties, particularly the petitioners to act and make their choice. Since the Court of Appeals
has found that neither party has expressed its desire or willingness to do the thing or things which by law
they are authorized or compelled to perform, the courts cannot disturb their present status and naturally,
payment of rent by respondent for the present, is not in order.

(The case was remanded to the trial court for further proceedings)