Académique Documents
Professionnel Documents
Culture Documents
E. Expenses
CASES:
Mendoza and Enriquez v. De Guzman 52 Phil. 164
74. Robles and Martin v. Lizzaraga Hermanos , etc. 42 Phil.
584
75. Metropolitan Waterworks and Sewerage System v. CA
143 SCRA 623
F. Possession of Animals
Title 6 Usufruct
A. Concept of Usufruct
1. Kinds of Usufruct
2. Special Usufructs
CASES:
Bachrach v. Seifert and Elianoff 87 Phil. 483
Hemedes v. Court of Appeals 316 SCRA 347
CASE:
Fabie v. Guiterrez David 75 Phil. 536
CASE:
Vda. de Aranas v. Aranas 150 SCRA 415
CASE:
Locsin v. Valenzuela 173 SCRA 454
Title 7 Easements or Servitudes In the meantime, plaintiff Valisno rebuilt the irrigation canal at his
own expense because his need for water to irrigate his watermelon
A. Easements in General (Arts. 613-633) fields was urgent.
1. Characteristics of Easements On June 20, 1960, he filed a complaint for damages in the Court
2. Classifications of Easements of First Instance (now Regional Trial Court) of Nueva Ecija (Civil
3. Dominant Owner vs. Servient Owner Case No. 3472) claiming that he suffered damages amounting to
4. Extinguishment of Easements P8,000 when he failed to plant his fields that year (1960) for lack
B. Legal Easements (Arts. 634-687) of irrigation water, P800 to reconstruct the canal on defendant
1. Easements Relating to Waters Adriano's land, and P1,500 for attorney's fees and the costs of suit.
2. Easement of Right of Way
3. Easement of Party Wall On October 25, 1961, the Secretary of Public Works and
4. Easement of Light and View Communications reversed the Bureau's decision by issuing a final
5. Drainage of Buildings resolution dismissing Valisno's complaint. The Secretary held that
6. Intermediate Distances and Works for Certain Eladio Adriano's water rights which had been granted in 1923
Constructions and Plantings ceased to be enjoyed by him in 1936 or 1937, when his irrigation
7. Easement Against Nuisance canal collapsed. His non-use of the water right since then for a
8. Lateral and Subjacent Support period of more than five years extinguished the grant by operation
of law, hence the water rights did not form part of his hereditary
C. Voluntary Easements (Arts. 688-693) estate which his heirs partitioned among themselves. Valisno, as
vendee of the land which Honorata received from her father's
CASES: estate did not acquire any water rights with the land
Valisno v. Adriano 161 SCRA 398 purchased.
FIRST DIVISION In his answer to the damage suit (Civil Case No. 3472), the
[G.R. No. L-37409. May 23, 1988.] defendant Felipe Adriano admitted that he levelled the irrigation
NICOLAS VALISNO, plaintiff-appellant, vs. FELIPE canal on his land, but he averred: that neither his late father nor
ADRIANO, defendant-appellee. his sister Honorata possessed water rights for the land which she
Honorio Valisno Garcia I for plaintiff-appellant. sold to the appellant; that he (the appellee) applied for water rights
Felipe K. Medina for defendant-appellee. for his land in 1956 and obtained the same in 1958; and that he
DECISION had a perfect right to level his land for his own use because he
GRIO-AQUINO, J p: merely allowed his sister to use his water rights when she still
This case was certified to this Court by the Court of Appeals in a owned the adjacent land. He set up a counterclaim for P3,000 as
resolution dated August 10, 1973, the sole issue being a question damages incurred by him in levelling the land on which the
of law and beyond its jurisdiction to decide. appellant dug an irrigation canal, P2,000 as actual damages,
FACTS: P3,000 as attorney's fees, and expenses of litigation.
On June 20, 1960, the plaintiff-appellant file against the defendant-
appellee an action for damages docketed as Civil Case No. 3472 In a decision dated April 21, 1966, the trial court held that the
in the Court of First Instance of Nueva Ecija. The complaint alleged plaintiff had no right to pass through the defendant's land to draw
that the plaintiff is the absolute owner and actual possessor of a water from the Pampanga River. It pointed out that under Section
557,949-square-meter parcel of land in La Fuente, Santa Rosa, 4 of the Irrigation Law, controversies between persons claiming a
Nueva Ecija, and more particularly described in his Transfer right to water from a stream are within the jurisdiction of the
Certificate of Title No. NT-16281. Secretary of Public Works and his decision on the matter is final,
The plaintiff-appellant Valisno bought the land from the defendant- unless an appeal is taken to the proper court within thirty days.
appellee's sister, Honorata Adriano Francisco, on June 6, 1959. The court may not pass upon the validity of the decision of the
(Deed of Absolute Sale, Exh. "A".) The land which is planted with Public Works Secretary collaterally. Furthermore, there was
watermelon, peanuts, corn, tobacco, and other vegetables adjoins nothing in the plaintiff's evidence to show that the resolution was
that of the appellee Felipe Adriano on the bank of the Pampanga not valid. It dismissed the complaint and counterclaim.
River. Both parcels of land had been inherited by Honorata
Adriano Francisco and her brother, Felipe Adriano, from their The plaintiff's motion for reconsideration of the decision was
father, Eladio Adriano. denied by the trial court. The plaintiff appealed to the Court of
At the time of the sale of the land to Valisno, the land was irrigated Appeals which certified the case to Us upon the legal question of
by water from the Pampanga River through a canal about seventy whether the provisions of the Irrigation Act (Act No. 2152) or those
(70) meters long, traversing the appellee's land. of the Civil Code should apply to this case.
On December 16, 1959, the appellee levelled a portion of the The plaintiff-appellant argues that while the trial court correctly
irrigation canal so that the appellant was deprived of the irrigation held that the Secretary of Public Works may legally decide who
water and prevented from cultivating his 57-hectare land. between the parties is entitled to apply for water rights under
the Irrigation Act, it erred in ruling that the Secretary has authority
The appellant filed in the Bureau of Public Works and to hear and decide the plaintiff's claim for damages for the
Communications a complaint for deprivation of water rights. A defendant's violation of his (plaintiff's) right to continue to enjoy the
decision was rendered on March 22, 1960 ordering Adriano to easement of aqueduct or water through the defendant's land
reconstruct the irrigation canal, "otherwise judicial action shall be under Articles 642, 643, and 646 of the Civil Code, which provide:
taken against him under the provisions of Section 47 of Act 2152 "Article 642. Any person who may wish to use upon his own estate
(the Irrigation Act), as amended." Instead of restoring the irrigation any water of which he can dispose shall have the right to make it
canal, the appellee asked for a reinvestigation of the case by the flow through the intervening estates, with the obligation to
Bureau of Public Works and Communications. A reinvestigation indemnify their owners, as well as the owners of the lower estates
was granted. upon which the waters may filter or descend.
"Article 643. One desiring to make use of the right granted in the
preceding article is obliged:
"(1) To prove that he can dispose of the water and that it is Water rights, such as the right to use a drainage ditch for
sufficient for the use for which it is intended; irrigation purposes, which are appurtenant to a parcel of land,
"(2) To show that the proposed right of way is the most convenient pass with the conveyance of the land, although not specifically
and the least onerous to third persons; mentioned in the conveyance. The purchaser's easement of
"(3) To indemnify the owner of the servient estate in the manner necessity in a water ditch running across the grantor's land cannot
determined by the laws and regulations. be defeated even if the water is supplied by a third person (Watson
"Article 646. For legal purposes, the easement of aqueduct shall vs. French, 112 Me 371, 19 C.J. 868-897). The fact that an
be considered as continuous and apparent, even though the flow easement by grant may also have qualified as an easement of
of the water may not be continuous, or its use depends upon the necessity does not detract from its permanency as property right,
needs of the dominant estate, or upon a schedule of alternate days which survives the determination of the necessity (Benedicto vs.
or hours." CA, 25 SCRA 145).
As an easement of waters in favor of the appellant has been
HELD: established, he is entitled to enjoy it free from obstruction,
The existence of the irrigation canal on defendant's land for the disturbance or wrongful interference (19 CJ 984), such as the
passage of water from the Pampanga River to Honorata's land appellee's act of levelling the irrigation canal to deprive him of the
prior to and at the time of the sale of Honorata's land to the plaintiff use of water from the Pampanga River.
was equivalent to a title for the vendee of the land to continue using WHEREFORE, the appealed decision is set aside, and a new one
it, as provided in Article 624 of the Civil Code: is entered ordering the appellee to grant the appellant continued
"Article 624. The existence of an apparent sign of easement and unimpeded use of the irrigation ditch traversing his land in
between two estates, established or maintained by the owner of order to obtain water from the Pampanga River to irrigate
both shall be considered should either of them be alienated, as a appellant's land. Let the records of this case be remanded to the
title in order that the easement may continue actively and court a quo for the reception of evidence on the appellant's claim
passively unless at the time the ownership of the two estates is for damages.
divided, the contrary should be provided in the title of conveyance SO ORDERED.
of either of them, or the sign aforesaid should be removed before ||| (Valisno v. Adriano, G.R. No. L-37409, [May 23, 1988], 244
the execution of the deed. This provision shall also apply in case PHIL 419-425)
of the division of a thing owned in common by two or more
persons" (Civil Code) Ronquillo, et al. v. Roco, et al. 103 Phil. 84
This provision was lifted from Article 122 of the Spanish Law of
Waters which provided: EN BANC
"Article 122. Whenever a tract of irrigated land which previously [G.R. No. L-10619. February 28, 1958.]
received its waters from a single point is divided through LEOGARIO RONQUILLO, ET AL., plaintiffs-appellants, vs.
inheritance, sale or by virtue of some other title, between two or JOSE ROCO, as Administrator of VICENTE ROCO Y
more owners, the owners of the higher estates are under DOMINGUEZ, ET AL., defendants-appellees.
obligation to give free passage to the water as an easement of Moises B. Cruz for appellants.
conduit for the irrigation of the lower estates, and without right to Vicente Roco, Jr. for appellees.
any compensation therefore unless otherwise stipulated in the SYLLABUS
deed of conveyance." (Art. 122, Spanish Law of Waters of August 1. EASEMENTS; CLASSIFIED AND HOW THEY ARE
3, 1866.) ACQUIRED. Under the Old as well as the New Civil Code,
No enlightened concept of ownership can shut out the idea of easements may be continuous or discontinuous (intermittent),
restrictions thereon, such as easements. Absolute and unlimited apparent or non-apparent, discontinuous being those used at
dominion is unthinkable, inasmuch as the proper enjoyment of more or less long intervals and which depend upon acts of man
property requires mutual service and forbearance among (Articles 532 and 615 of the Old and New Civil Codes,
adjoining estates (Amor vs. Florentino, 74 Phil. 403). respectively). Continuous and apparent easements are acquired
As indicated in the decision dated March 22, 1960 of the Bureau either by title or prescription, continuous non-apparent easements
of Works "the principal issue involved in this case falls under the and discontinuous ones whether apparent or not, may be acquired
subject of servitude of waters which are governed by Article 648 only by virtue of a title. Articles 537 and 539, and 620 and 622 of
of the new Civil Code and the suppletory laws mentioned in the the Old and New Civil Codes respectively.)
cases of Lunod vs. Meneses (11 Phil. 128) and Osmea vs. 2. ID.; EASEMENT OF RIGHT OF WAY MAY NOT BE
Camara (C.A. 380 62773) which are the irrigation law and the ACQUIRED THROUGH PRESCRIPTION. Under the
Spanish Law of Waters of August 3, 1866, specifically Article 122 provisions of Articles 537 and 539, and 620 and 622 of the Old and
thereof. New Civil Codes, respectively, the easement of right of way may
not be acquired through prescription.
The deed of sale in favor of Valisno included the "conveyance DECISION
and transfer of the water rights and improvements" MONTEMAYOR, J p:
appurtenant to Honorata Adriano's property. By the terms of Involving as it does only a question of law, the present appeal from
the Deed of Absolute Sale, the vendor Honorata Adriano the order of the Court of First Instance of Camarines Sur, dated
Francisco sold, ceded, conveyed and transferred to Dr. Nicolas March 6, 1955, dismissing the amended and supplemental
Valisno all "rights, title, interest and participations over the parcel complaint of plaintiffs on motion of defendants that it did not state
of land above-described, together with one Berkely Model 6 YRF a cause of action, was taken directly to this Court.
Centrifugal Pump G" suction, 6" discharge 500-1500 GPM, with FACTS:
Serial No. 5415812 and one (1) set of suction pipe and discharge "The amended and supplemental complaint alleges that the
of pipe with elbow, nipples, flanges and footvalves," and the water plaintiffs have been in the continuous and uninterrupted use of a
rights and such other improvements appertaining to the property road or passage way which traversed the land of the defendants
subject of this sale. According to the appellant, the water right was and their predecessors in interest, in going to Igualdad Street and
the primary consideration for his purchase of Honorata's property, the market place of Naga City, from their residential land and back,
for without it the property would be unproductive. for more than 20 years; that the defendants and the tenants of
Vicente Roco, the predecessors in interest of the said defendants
have long recognized and respected the private legal easement of
road right of way of said plaintiffs; that on May 12, 1953, the referring to discontinuous easements, such as, easement of right
defendants Jose Roco thru his co-defendants, Raymundo of way. (Bargayo vs. Camumot, 40 Phil., 857, 867).
Martinez and their men with malice aforethought and with a view In the case of Cuayong vs. Benedicto, 37 Phil., 781 where the
to obstructing the plaintiffs' private legal easement over the point in issue was whether or not vested rights in a right of way
property of the late Vicente Roco, started constructing a chapel in can be acquired through user from time immemorial, this Court
the middle of the said right of way construction actually impeded, said:
obstructed and disturbed the continuous exercise of the rights of "It is evident, therefore, that no vested right by user from time
the plaintiffs over said right of way; that on July 10, 1954 the new immemorial had been acquired by plaintiffs at the time the Civil
defendants Natividad Roco and Gregorio Miras, Jr. with the Code took effect. Under that Code (Article 539) no discontinuous
approval of the defendant, Jose Roco and with the help of their easement could be acquired by prescription in any event."
men and laborers, by means of force, intimidation, and threats, However, in the case of Municipality of Dumangas vs. Bishop of
illegally and violently planted wooden posts, fenced with barbed Jaro, 34 Phil., 545, this same Tribunal held that the continued use
wire and closed hermitically the road passage way and their right by the public of a path over land adjoining the Catholic church in
of way in question against their protests and opposition, thereby going to and from said church through its side door, has given the
preventing them from going to or coming from their homes to church the right to such use by prescription, and that because of
Igualdad Street and the public market of the City of Naga. said use by the public, an easement of right of way over said land
"It is very clear from the allegations of the plaintiffs in their has been acquired by prescription, not only by the church, but also
amended and supplemental complaint, that they claim to have by the public, which without objection or protest on the part of the
acquired the easement of right of way over the land of the owner of said land, had continually availed itself of the easement.
defendants and the latter's predecessors in interest, Vicente Roco, The minority of which the writer of this opinion is a part, believes
thru prescription by their continuous and uninterrupted use of a that the easement of right of way may now be acquired through
narrow strip of land of the defendants as passage way or road in prescription, at least since the introduction into this jurisdiction of
going to Igualdad Street and the public market of Naga City, from the special law on prescription through the Old Code of Civil
their residential land or houses, and return. Procedure, Act No. 190. Said law, particularly, Section 41 thereof,
makes no distinction as to the real rights which are subject to
ISSUE: prescription, and there would appear to be no valid reason, at least
"The only question therefore to be determined in this case, is to the writer of this opinion, why the continued use of a path or a
whether an easement of right of way can be acquired thru road or right of way by the party, specially by the public, for ten
prescription." years or more, not by mere tolerance of the owner of the land, but
through adverse use of it, Cannot give said party a vested right to
HELD: such right of way through prescription.
The dismissal was based on the ground that an easement of right "The uninterrupted and continuous enjoyment of a right of way
of way though it may be apparent is, nevertheless, discontinuous necessary to constitute adverse possession does not require the
or intermittent and, therefore, cannot be acquired through use thereof every day for the statutory period, but simply the
prescription, but only by virtue of a title. Under the Old as well as exercise of the right more or less frequently according to the nature
the New Civil Code, easements may be Continuous or of the use. (17 Am. Jur. 972)"
discontinuous (intermittent), apparent or non-apparent, Even under the case of Cuaycong vs. Benedicto (supra), this
discontinuous being those used at more or less long intervals and Tribunal insinuated that the rule that no discontinuous easement,
which depend upon acts of man (Articles 532 and 615 of the Old like an easement of right of way, may, under Article 539 of the Old
and New Civil Codes, respectively). Continuous and apparent Civil Code, be acquired, might possibly have been changed by the
easements are acquired either by title or prescription, continuous provisions of the Code of Civil Procedure relative to prescription.
non-apparent easements and discontinuous ones whether . . . "Assuming, without deciding, that this rule has been changed
apparent or not, may be acquired only by virtue of a title (Articles by the provisions of the present Code of Civil Procedure relating
537 and 539, and 620 and 622 of the Old and New Civil Codes, to prescription, and that since its enactment discontinuous
respectively). easement may be acquired by prescription, it is clear that this
Both Manresa and Sanchez Roman are of the opinion that the would not avail plaintiffs. The Code of Civil Procedure went into
easement of right of way is a discontinuous one: effect on October 1, 1901. The term of prescription for the
"En cambio, las servidumbres discontinuos se ejercitan por un acquisition of rights in real estate is fixed by the Code (section 41)
hecho del hombre, y precisamente por eso son y tienen que ser at ten years. The evidence shows that in February, 1911 before
discontinuas, porque es imposible fisicamente que su uso sea the expiration of the term of ten years since the time the Code of
incesante. Asi, la servidumbre de paso es discontinua, porque no Civil Procedure took effect, the defendants interrupted the use of
es posible que el hombre est pasando continuamente por el the road by plaintiffs by constructing and maintaining a toll gate on
camino, vereda o senda de que se trate." (4 Manresa, Codigo Civil it and collecting toll from persons making use of it with carts and
Espaol, 5th ed., p. 529). continued to do so until they were enjoined by the granting of the
. . . "5 Por razon de los modos de disfrutar las servidumbres, en preliminary injunction by the trial court in December 1912." . . .
continuas y discontinuas (1). Las continuas son aquellas cuyo uso (Cuayong vs. Benedicto, 37 Phil., 781,796).
es o puede ser incesante, sin la intervencion de ningun hecno del Professor Tolentino in his Commentaries and Jurisprudence on
hombre, como son las de luces y otras de la misma especie; y the Civil Code, Vol. I, p. 340, would appear to be of the opinion
las discontinuas, las que se usan intervalos, ms o menos that under the provisions of the Code of Civil Procedure relative to
largos, y dependen de actos del hombre, como las de senda, prescription, even discontinuous easements, like the easement of
carrera y otras de esta clase." (3 Sanches Roman, Derecho Civil, right of way, may be acquired through prescription:
p. 488). . . . "It is submitted that under Act No. 190, even discontinuous
Under the provisions of the Civil Code, old and new, particularly servitudes can be acquired by prescription, provided it can be
the articles thereof aforecited, it would therefore appear that the shown that the servitude was 'actual, open, public, continuous,
easement of right of way may not be acquired through under a claim of title exclusive of any other right and adverse to all
prescription. Even Article 1959 of the Old Civil Code providing for other claimants'." However, the opinion of the majority must
prescription of ownership and other real rights in real property, prevail, and it is held that under the present law, particularly, the
excludes therefrom the exception established by Article 539, provisions of the Civil Code, old and new, unless and until the
same is changed or clarified, the easement of right of way may not which dismissed the complaint for legal redemption filed by the
be acquired through prescription. petitioner in Civil Case No. CEB-994 of the Regional Trial Court of
||| (Ronquillo v. Roco, G.R. No. L-10619, [February 28, 1958], 103 Cebu, and the Order of the same respondent judge, dated 20
PHIL 84-92) January 1984, which denied petitioner's motion for
Taedo v. Bernad 165 SCRA 86 reconsideration.
SECOND DIVISION FACTS:
[G.R. No. 66520. August 30, 1988.] The private respondent Antonio Cardenas was the owner of two
EDUARDO C. TAEDO, petitioner, vs. HON. JUANITO (2) contiguous parcels of land situated in Cebu City which he had
A. BERNAD, Presiding Judge of the Regional Trial Court, 7th inherited from Lourdes Cardenas and more particularly known as
Judicial Region, Branch XXI, Cebu City; Spouses ROMEO SIM Lot 7501-A, with an area of 140 square meters and Lot 7501-B,
and PACITA S. SIM; and Spouses ANTONIO CARDENAS and with an area of 612 square meters. On Lot 7501-A is constructed
MAE LINDA CARDENAS, respondents. an apartment building, while the improvements on Lot 7501-B
Numeriano F . Capangpangan for petitioner. consist of one four-door apartment of concrete and strong
Meinrado P. Paredes for private respondents. materials; one two-storey house of strong materials; a bodega of
SYLLABUS strong materials; and a septic tank for the common use of the
1. REMEDIAL LAW; COMPLAINT; DISMISSAL THEREOF FOR occupants of Lots 7501-A and 7501-B. A small portion of the
LACK OF CAUSE OF ACTION; EXPLAINED. The dismissal of apartment building on Lot 7501-A also stands on Lot 7501-B.
the complaint on the ground of lack of cause of action, is
precipitate. The settled rule where dismissal of an action is sought On 5 February 1982, said Antonio Cardenas sold Lot 7501-A to
on the ground that the complaint does not state a cause of action herein petitioner Eduardo C. Taedo.
is, that the insufficiency of the cause of action must appear on the Antonio Cardenas, on that same day, also mortgaged Lot 7501-B
face of the complaint. And the test of the sufficiency of the ultimate to said Eduardo C. Taedo as a security for the payment of a loan
facts alleged in the complaint to constitute a cause of action, is in the amount of P10,000.00.
whether or not, admitting the facts alleged, the court can render a
valid judgment upon the same in accordance with the prayer of the Antonio Cardenas further agreed that he would sell Lot 7501-B
complaint. For this purpose, the movant is deemed to admit only to Eduardo Taedo in case he should decide to sell it, as the
hypothetically the truth of the facts thus averred. septic tank in Lot 7501-B services Lot 7501-A and the apartment
2. CIVIL LAW; DAMAGES; DETERMINED IN A TRIAL IN CASE building on Lot 7501-A has a part standing on Lot 7501-B. This
OF BREACH OF PROMISE TO SELL. Considering the was confirmed in a letter, dated 26 February 1982, wherein
admission of defendant Cardenas, and that his promise to sell Lot Antonio Cardenas asked Taedo not to deduct the mortgage loan
7501-B to Eduardo Taedo appears to be for a valuable of P10,000.00 from the purchase price of Lot 7501-A "because as
consideration, a trial is necessary to determine, at the very least, we have previously agreed, I will sell to you Lot 7501-B." 3
the amount of damages suffered by the plaintiff
Eduardo Taedo by reason of such breach of promise to sell, if Antonio Cardenas, however, sold Lot 7501-B to the herein
indeed there is such a breach. respondent spouses Romeo and Pacita Sim. 4 Upon learning of
3. ID.; EASEMENT; ALIENATION OF DOMINANT AND the sale, Eduardo Taedo offered to redeem the property from
SERVIENT ESTATES, NOT GROUND FOR ITS Romeo Sim. But the latter refused. Instead, Romeo Sim blocked
EXTINGUISHMENT; CASE AT BAR. The finding of the trial the sewage pipe connecting the building of
court that petitioner Taedo's right to continue to use the septic Eduardo Taedo built on Lot 7501-A, to the septic tank in Lot
tank, erected on Lot 7501-B, ceased upon the subdivision of the 7501-B. He also asked Taedo to remove that portion of his
land and its subsequent sale to different owners who do not have building encroaching on Lot 7501-B. As a result, Eduardo Taedo,
the same interest, also appears to be contrary to law. Article 631 invoking the provisions of Art. 1622 of the Civil Code, filed an
of the Civil Code enumerates the grounds for the extinguishment action for legal redemption and damages, with a prayer for the
of an easement. The alienation of the dominant and servient issuance of a writ of preliminary injunction, before the Regional
estates to different persons is not one of the grounds for the Trial Court of Cebu, docketed therein as Civil Case No. CEB-994,
extinguishment of an easement. On the contrary, use of the against the spouses Romeo and Pacita Sim, Antonio Cardenas
easement is continued by operation of law. Article 624 of the Civil and his wife Mae Linda Cardenas, the Register of Deeds of Cebu
Code provides: "Art. 624. The existence of an apparent sign of City, and Banco Cebuano, Cebu City Development Bank. 5
easement between two estates, established or maintained by the Answering, the spouses Romeo and Pacita Sim claimed that they
owner of both, shall be considered, should either of them be are the absolute owners of Lot 7501-B and that
alienated, as a title in order that the easement may continue Eduardo Taedo has no right to redeem the land under Art. 1622
actively and passively, unless, at the time the ownership of the two of the Civil Code as the land sought to be redeemed is much bigger
estates is divided, the contrary should be provided in the title of than the land owned by Taedo. 6
conveyance of either of them, or the sign aforesaid should be Antonio Cardenas, upon the other hand, admitted that he had
removed before the execution of the deed. This provision shall agreed to sell Lot 7501-B to Eduardo Taedo and claimed by way
also apply in case of the division of a thing owned in common by of cross-claim against the spouses Romeo and Pacita Sim, that
two or more persons." In the instant case, no statement abolishing the Deed of Sale he had executed in favor of said spouses was
or extinguishing the easement of drainage was mentioned in the only intended as an equitable mortgage, to secure the payment of
deed of sale of Lot 7501-A to Eduardo Taedo. Nor did Antonio amounts received by him from said spouses as petty loans. 7
Cardenas stop the use of the drain pipe and septic tank by the In answer to the cross-claim, the spouses Romeo and Pacita Sim
occupants of Lot 7501-A before he sold said lot to insisted that the sale executed by Antonio Cardenas of Lot 7501-
Eduardo Taedo. Hence, the use of the septic tank is continued B in their favor was an absolute one. 8
by operation of law. Accordingly, the spouses Romeo and Pacita Thereafter, or on 14 October 1983, the spouses Romeo and Pacita
Sim, the new owners of the servient estate (Lot 7501-B), cannot Sim filed motions to dismiss the complaint and the cross-claim, for
impair, in any manner whatsoever, the use of the servitude. lack of cause of action. 9
DECISION Acting upon these motions and other incidental motions, the
PADILLA, J p: respondent judge issued the questioned order of 5 December
This is a petition for review on certiorari of the Order issued by the 1983 dismissing the complaint and cross-claim. 10
respondent judge, Hon. Juanito A. Bernad, on 5 December 1983,
Taedo filed a motion for reconsideration of the order, but his truth is, that the herein defendants [sic] was required to execute
motion was denied on 20 January 1984. 11 the Deed of Sale described in this paragraph 3 as security for the
Hence, the present recourse by petitioner Taedo. personal loans and other forms of indebtedness incurred from the
Spouses Sims but never as a conveyance to transfer
HELD: ownership;" 15
The Court finds merit in the petition. The dismissal of the complaint Considering this admission of defendant Cardenas, and that his
on the ground of lack of cause of action, is precipitate. The settled promise to sell Lot 7501-B to Eduardo Taedo appears to be for a
rule where dismissal of an action is sought on the ground that the valuable consideration, a trial is necessary to determine, at the
complaint does not state a cause of action is, that the insufficiency very least, the amount of damages suffered by the plaintiff
of the cause of action must appear on the face of the complaint. Eduardo Taedo by reason of such breach of promise to sell, if
And the test of the sufficiency of the ultimate facts alleged in the indeed there is such a breach.
complaint to constitute a cause of action, is whether or not,
admitting the facts alleged, the court can render a valid judgment Moreover, the finding of the trial court that petitioner Taedo's right
upon the same in accordance with the prayer of the complaint. For to continue to use the septic tank, erected on Lot 7501-B, ceased
this purpose, the movant is deemed to admit hypothetically the upon the subdivision of the land and its subsequent sale to
truth of the facts thus averred. 12 different owners who do not have the same interest, 16 also
In the instant case, it cannot be denied that appears to be contrary to law. Article 631 of the Civil Code
petitioner Taedo cannot redeem the entire Lot 7501-B from the enumerates the grounds for the extinguishment of an easement.
spouses Romeo and Pacita Sim pursuant to the provisions of Art. Said article provides:
1622 of the Civil Code, since the lot sought to be redeemed, has "Art. 631. Easements are extinguished:
an area of 612 square meters which is much bigger, area-wise, (1) By merger in the same person of the ownership of the dominant
than the lot owned by petitioner Taedo. However, the petitioner and servient estates;
seeks to purchase only that small portion of Lot 7501-B occupied (2) By non-user for ten years; with respect to discontinuous
by his apartment building, because the spouses Romeo and easements, this period shall be computed from the day on which
Pacita Sim had told him to remove that portion of his building which they ceased to be used; and, with respect to continuous
encroaches upon Lot 7501-B. Whether or not this is possible easements, from the day on which an act contrary to the same
should have been determined at the pre-trial stage or trial on the took place;
merits. (3) When either or both of the estates fall into such condition that
Besides, the action of petitioner Taedo is also one for recovery of the easement cannot be used; but it shall revive if the subsequent
damages by reason of breach of promise by the respondent condition of the estates or either of them should again permit its
Antonio Cardenas to sell Lot 7501-B. Paragraphs 3 and 4 of the use, unless when the use becomes possible, sufficient time for
amended complaint read, as follows: prescription has elapsed, in accordance with the provisions of the
"3. That by written agreement, plaintiff and defendant spouses preceding number;
Antonio Cardenas and Mae Linda Cardenas agreed that in the (4) By the expiration of the term or the fulfillment of the condition,
event they decide to sell the adjacent Lot No. 7501-B of the if the easement is temporary or conditional;
subdivision plan (LRC) Psd. 23638, a portion of Lot No. 7501 of (5) By the renunciation of the owner of the dominant estate;
the cadastral survey of Cebu, LRC (GLRC) Cad. Record No. 9465, (6) By the redemption agreed upon between the owners of the
situated in the City of Cebu, containing an area of SIX HUNDRED dominant and servient estates."
TWELVE (612) Square meters more or less which lot is adjacent As can be seen from the above provisions, the alienation of the
to Lot No. 7501-A of the plaintiff and where part of the plaintiff's dominant and servient estates to different persons is not one of
apartment is standing on, the same should be sold to the plaintiff, the grounds for the extinguishment of an easement. On the
but far from compliance of the written agreement, defendant contrary, use of the easement is continued by operation of
spouses Antonio Cardenas and Mae Linda law. Article 624 of the Civil Code provides:
Cardenas sureptiously [sic] sold the aforestated Lot No. -7501-B- "Art. 624. The existence of an apparent sign of easement between
to the defendant spouses, Romeo Sim and Pacita Sim on July 23, two estates, established or maintained by the owner of both, shall
1932 as per Deed of Sale notarized by Notary Public, Jorge S. be considered, should either of them be alienated, as a title in
Omega and entered in his Notarial Register as Doc. No. 462; Page order that the easement may continue actively and passively,
No.-94-; Book No. 11, Series of 1982; unless, at the time the ownership of the two estates is divided, the
contrary should be provided in the title of conveyance of either of
"4. That due to the sale by the defendant spouses Antonio them, or the sign aforesaid should be removed before the
Cardenas and Mae Linda Cardenas of the property in question to execution of the deed. This provision shall also apply in case of
spouses Romeo Sim and Pacita Lim, plaintiff suffered moral the division of a thing owned in common by two or more persons."
damages in the form of mental anguish, sleepless nights, mental In the instant case, no statement abolishing or extinguishing the
torture, for which he is entitled to a compensation in the amount to easement of drainage was mentioned in the deed of sale of Lot
be established during the trial of the case and has incurred 7501-A to Eduardo Taedo. Nor did Antonio Cardenas stop the
litigation expenses subject for reimbursement and attorneys fee in use of the drain pipe and septic tank by the occupants of Lot 7501-
the sum of P10,000.00 which should be chargeable to both A before he sold said lot to Eduardo Taedo. Hence, the use of
defendant spouses;" 13 and the plaintiff (herein petitioner) prayed, the septic tank is continued by operation of law. Accordingly, the
among others: "(c) That defendant spouses Romeo Sim and spouses Romeo and Pacita Sim, the new owners of the servient
Pacita Sim, and spouses Antonio Cardenas and Mae Linda estate (Lot 7501-B), cannot impair, in any manner whatsoever, the
Cardenas be ordered to pay plaintiff moral damages, litigation use of the servitude. 17
expenses and attorneys fees in the amount of P50,000.00." 14 WHEREFORE, the Orders complained of are hereby REVERSED
That there was a written agreement, as alleged in the complaint, and SET ASIDE. The respondent judge or another one designated
between the plaintiff Eduardo Taedo and the defendant Antonio in his place is directed to proceed with the trial of this case on the
Cardenas is admitted by the latter. In his answer, he alleged the merits. With costs against private respondents. prLL
following: SO ORDERED.
"ALLEGATIONS as to written agreement is ADMITTED, but, ||| (Taedo v. Bernad, G.R. No. 66520, [August 30, 1988])
specifically denies that herein defendants SUREPTIOUSLY [sic]
SOLD the lot in question to the other defendant Spouses Sim, the Costabella Corporation v. Court of Appeals 193 SCRA 333
SECOND DIVISION situated at Sitio Buyong, Maribago, Lapu-Lapu City, on which it
[G.R. No. 80511. January 25, 1991.] had constructed a resort and hotel.
COSTABELLA CORPORATION, petitioner, vs. COURT OF The private respondents, on the other hand, are the owners of
APPEALS, KATIPUNAN LUMBER CO., INC., AURORA adjoining properties more particularly known as Lots Nos. 5123-A
BUSTOS LOPEZ, MANUEL S. SATORRE, JR., JOSEFA C. and 5123-C of the Opon Cadastre.
REVILLES, FELIX TIUKINHOY, JR., PERFECTA L.
CHUANGCO, and CESAR T. ESPINA, respondents. Before the petitioner began the construction of its beach hotel, the
Roco, Bunag, Kapunan & Migallos for petitioner. private respondents, in going to and from their respective
Albano, Garcia & Diaz Law Offices for Katipunan Lumber Co., Inc. properties and the provincial road, passed through a passageway
Zosa & Quijano Law Offices for respondents. which traversed the petitioner's property.
SYLLABUS In 1981, the petitioner closed the aforementioned passageway
1. CIVIL LAW; EASEMENT; RIGHT OF WAY; CANNOT BE when it began the construction of its hotel, but nonetheless opened
ACQUIRED BY PRESCRIPTION. It is already well-established another route across its property through which the private
that an easement of right of way is discontinous and as such can respondents, as in the past, were allowed to pass. (Later, or
not be acquired by prescription. sometime in August, 1982, when it undertook the construction of
2. ID.; ID.; ID.; REQUISITES OF COMPULSORY DEMAND the second phase of its beach hotel, the petitioner fenced its
THEREOF. Based on Articles 649 and 650 of the New Civil property thus closing even the alternative passageway and
Code, the owner of the dominant estate may validly claim a preventing the private respondents from traversing any part of it.)
compulsory right of way only after he has established the
existence of four requisites, to wit: (1) the (dominant) estate is As a direct consequence of these closures, an action for injunction
surrounded by other immovables and is without adequate outlet to with damages was filed against the petitioner by the private
a public highway; (2) after payment of the proper indemnity; (3) the respondents on September 2, 1982 before the then Court of First
isolation was not due to the proprietor's own acts; and (4) the right Instance of Cebu. 4 In their complaint, the private respondents
of way claimed is at a point least prejudicial to the servient estate. assailed the petitioner's closure of the original passageway which
Additionally, the burden of proving the existence of the foregoing they (private respondents) claimed to be an "ancient road right of
pre-requisites lies on the owner of the dominant estate. way" that had been existing before World War II and since then
3. ID.; ID.; ID.; STANDARD FOR GRANT. The true standard for had been used by them, the community, and the general public,
the grant of the legal right is "adequacy." Hence, when there is either as pedestrians or by means of vehicles, in going to and
already an existing adequate outlet from the dominant estate to a coming from Lapu-Lapu City and other parts of the country. The
public highway, even if the said outlet, for one reason or another, private respondents averred that by closing the alleged road right
be inconvenient, the need to open up another servitude is entirely of way in question, the petitioner had deprived them access to their
unjustified. For to justify the imposition of an easement of right of properties and caused them damages.
way, "there must be a real, not a fictitious or artificial necessity for In the same complaint, the private respondents likewise alleged
it." that the petitioner had constructed a dike on the beach fronting the
4. ID.; ID.; ID.; DEMANDED BY NECESSITY. Servitudes of latter's property without the necessary permit, obstructing the
right of way are an ancient concept, which date back to the iter, passage of the residents and local fishermen, and trapping debris
actus, and via of the Romans. They are demanded by necessity, and flotsam on the beach. They also claimed that the debris and
that is, to enable owners of isolated estates to make full use of flotsam that had accumulated prevented them from using their
their properties, which lack of access to public roads has denied properties for the purpose for which they had acquired them. The
them. Under Article 649 of the Civil Code, they are compulsory and complaint this prayed for the trial court to order the re-opening of
hence, legally demandable, subject to indemnity and the the original passageway across the petitioner's property as well as
concurrence of the other conditions above-referred to. the destruction of the dike. 5
5. ID.; ID.; ID.; CRITERIA FOR GRANT. But while a right of way
is legally demandable, the owner of the dominant estate is not at In its answer, 6 the petitioner denied the existence of an ancient
liberty to impose one based on arbitrary choice. Under Article 650 road through its property and counter-averred, among others, that
of the Code, it shall be established upon two criteria: (1) at the it and its predecessors-in-interest had permitted the temporary,
point least prejudicial to the servient estate; and (2) where the intermittent, and gratuitous use of, or passage through, its property
distance to a public highway may be the shortest. According, by the private respondents and others by mere tolerance and
however, to one commentator, "least prejudice" prevails over purely as an act of neighborliness. It justified the walling in of its
"shortest distance." Yet each case must be weighed according to property in view of the need to insure the safety and security of its
its individual merits and judged according to the sound discretion hotel and beach resort, and for the protection of the privacy and
of the court. "The Court," says Tolentino, "is not bound to establish convenience of its hotel patrons and guests. At any rate, the
what is the shortest; a longer way may be established to avoid petitioner alleged, the private respondents were not entirely
injury to the servient tenement, such as when there are dependent on the subject passageway as they (private
constructions or walls which can be avoided by a roundabout way, respondents) had another existing and adequate access to the
or to secure the interest of the dominant owner, such as when the public road through other properties.
shortest distance would place the way on a dangerous decline." With respect to the dike it allegedly constructed, the petitioner
DECISION stated that what it built was a breakwater on the foreshore land
SARMIENTO, J p: fronting its property and not a dike as claimed by the private
The principal issue raised in this petition for review on certiorari of respondents. Moreover, contrary to the private respondents'
the decision 1 dated May 30, 1986 of the Court of accusation, the said construction had benefited the community
Appeals, 2 which modified the decision 3rendered by the Regional especially the fishermen who used the same as mooring for their
Trial Court of Lapu-Lapu City in Cebu, is whether or not the private boats during low tide. The quantity of flotsam and debris which had
respondents had acquired an easement of right of way, in the form formed on the private respondents' beach front on the other hand
of a passageway, on the petitioner's property. were but the natural and unavoidable accumulations on beaches
by the action of the tides and movement of the waves of the sea.
It is admitted that the petitioner owns the real estate properties The petitioner's answer then assailed the private respondents'
designated as Lots Nos. 5122 and 5124 of the Opon Cadastre, complaint for its failure to implead as defendants the owners of the
other properties supposedly traversed by the alleged ancient road
right way, indispensable parties without whom no final adjudication of use of the right of way to protect defendant's property and its
of the controversy could be rendered. 7 customers. This is the gist of Our decision. 14
After trial, the court a quo rendered a decision on March 15, 1984 Now before us, the petitioner contends that the decision of the
finding that the private respondents had acquired a vested right respondent appellate court is grossly erroneous and not in accord
over the passageway in controversy based on its long existence with the provisions of Articles 649 and 650 of the Civil Code on
and its continued use and enjoyment not only by the private easements and the prevailing jurisprudence on the matter.
respondents, but also by the community at large. The petitioner in
so closing the said passageway, had accordingly violated the HELD:
private respondents' vested right. Thus, the trial court ordered the The petition is meritorious.
petitioner: It is already well-established that an easement of right of way, as
1. To open and make available the road in question to the plaintiffs is involved here, is discontinuous 15 and as such cannot be
and the general public at all times free of any obstacle thereof, acquired by prescription. 16Insofar therefore as the appellate
unless the defendant shall provide another road equally accessible court adhered to the foregoing precepts, it stood correct.
and convenient as the road or passage closed by the defendant; Unfortunately, after making the correct pronouncement, the
2. To pay the plaintiff Katipunan Lumber Company, Inc. the respondent Appellate Court did not order the reversal of the trial
amount of FIVE THOUSAND PESOS (P5,000.00) a month court's decision and the dismissal of the complaint after holding
beginning January, 1983, and the plaintiff Perfecto Guangco the that no easement had been validly constituted over the petitioner's
sum of TWO HUNDRED PESOS (P200.00) a month beginning property. Instead, the Appellate Court went on to commit a
September, 1982, representing their respective expenditures they reversible error by considering the passageway in issue as a
had incurred in other beach resorts after the road was closed, until compulsory easement which the private respondents, as owners
the passageway claimed by them is opened and made available of the "dominant" estate, may demand from the petitioner the latter
to them, or if the defendant chooses to provide another road, until being the owner of the "servient" estate.
such road is made available and conveniently passable to the It is provided under Articles 649 and 650 of the New Civil Code
plaintiffs and the general public; and that:
3. To pay the sum of FIFTEEN THOUSAND PESOS (P15,000.00) Art. 649. The owner, or any person who by virtue of a real right
attorney's fees, and to pay the costs. 8 may cultivate or use any immovable, which is surrounded by other
immovables pertaining to other persons and without adequate
Both parties elevated the trial court's decision to the Court of outlet to a public highway, is entitled to demand a right of way
Appeals, with the petitioner questioning the alleged "vested right" through the neighboring estates, after payment of the proper
of the private respondents over the subject passageway, and the indemnity.
private respondents assailing the dismissal of their complaint Should this easement be established in such a manner that its use
insofar as their prayer for the demolition of the petitioner's "dike" is may be continuous for all the needs of the dominant estate,
concerned. establishing a permanent passage, the indemnity shall consist of
In its decision, the respondent Appellate Court held as without the value of the land occupied and the amount of the damage
basis the trial court's finding that the private respondents had caused to the servient estate.
acquired a vested right over the passageway in question by virtue In case the right of way is limited to the necessary passage for the
of prescription. 9 The appellate court pointed out that an easement cultivation of the estate surrounded by others and for the gathering
of right of way is a discontinuous one which, under Article 622 of of its crops through the servient estate without a permanent way,
the New Civil Code, may only be acquired by virtue of a title and the indemnity shall consist in the payment of the damage caused
not by prescription. 10 That notwithstanding, the appellate court by such encumbrance.
went on to rule that ". . . in the interest of justice and in the exercise This easement is not compulsory if the isolation of the immovable
by this Court of its equity jurisdiction, there is no reason for Us in is due to the proprietor's own acts.
not treating the easement here sought by appellees Katipunan Art. 650. The easement of right of way shall be established at the
Lumber Co., Inc. and Perfecta Guangco as one that is not point least prejudicial to the servient estate, and, insofar as
dependent upon the claims of the parties but a compulsory one consistent with this rule, where the distance from the dominant
that is legally demandable by the owner of the dominant estate estate to a public highway may be the shortest.
from the owner of the servient estate." 11 Thus the appellate court: Based on the foregoing, the owner of the dominant estate may
(1) granted the private respondents the right to an easement of validly claim a compulsory right of way only after he has
way on the petitioner's property using the passageway in question, established the existence of four requisites, to wit: (1) the
unless the petitioner should provide another passageway equally (dominant) estate is surrounded by other immovables and is
accessible and convenient as the one it closed; (2) remanded the without adequate outlet to a public highway; (2) after payment of
case to the trial court for the determination of the just and proper the proper indemnity; (3) the isolation was not due to the
indemnity to be paid to the petitioner by the private respondents proprietor's own acts; and (4) the right of way claimed is at a point
for the said easement; and (3) set aside the trial court's award of least prejudicial to the servient estate. Additionally, the burden of
actual damages and attorney's fees. 12 proving the existence of the foregoing pre-requisites lies on the
owner of the dominant estate. 17
On petitioner's motion for partial reconsideration, the respondent Here, there is absent any showing that the private respondents
court issued on October 27, 1987 a resolution 13 denying the said had established the existence of the four requisites mandated by
motion. The Appellate Court however in denying the petitioner's law. For one, they failed to prove that there is no adequate outlet
motion for reconsideration stated that: from their respective properties to a public highway. On the
. . . While it is true that there is another outlet for the plaintiff to the contrary, as alleged by the petitioner in its answer to the complaint,
main road, yet such outlet is a new road constructed in 1979, while and confirmed by the appellate court, "there is another outlet for
the road closed by defendant existed since over 30 years before. the plaintiffs (private respondents) to the main road." 18 Thus,
Legally, the old road could be closed; but since the existing outlet the respondent Court of Appeals likewise admitted that "legally the
is inconvenient to the plaintiff, equitably the plaintiff should be old road could be closed." 19 Yet, it ordered the re-opening of the
given a chance to pay for a more convenient outlet through the old passageway on the ground that "the existing outlet (the other
land of the defendant at a point least prejudicial to the latter. In any outlet) is inconvenient to the plaintiff." 20 On this score, it is
event, the plaintiff shall pay for all damages that defendant apparent that the Court of Appeals lost sight of the fact that the
corporation may sustain and the defendant regulates the manner convenience of the dominant estate has never been the gauge for
the grant of compulsory right of way. 21 To be sure, the true way may have proved adequate at the start, the dominant owner's
standard for the grant of the legal right is "adequacy." Hence, when need may have changed since then, for which Article 651 of the
there is already an existing adequate outlet from the dominant Code allows adjustments as to width. 28
estate to a public highway, even if the said outlet, for one reason
or another, be inconvenient, the need to open up another servitude But while a right of way is legally demandable, the owner of the
is entirely unjustified. For to justify the imposition of an easement dominant estate is not at liberty to impose one based on arbitrary
or right of way, "there must be a real, not a fictitious or artificial choice. Under Article 650 of the Code, it shall be established upon
necessity for it." 22 two criteria: (1) at the point least prejudical to the servient state;
Further, the private respondents failed to indicate in their complaint and (2) where the distance to a public highway may be the
or even to manifest during the trial of the case that they were willing shortest. According, however, to one commentator, "least
to indemnify fully the petitioner for the right of way to be prejudice" prevails over "shortest distance." 29 Yet, each case
established over its property. Neither have the private respondents must be weighed according to its individual merits, and judged
been able to show that the isolation of their property was not due according to the sound discretion of the court. "The court," says
to their personal or their predecessors-in-interest's own acts. Tolentino, "is not bound to establish what is the shortest; a longer
Finally, the private respondents failed to allege, much more way may be established to avoid injury to the servient tenement,
introduce any evidence, that the passageway they seek to be re- such as when there are constructions or walls which can be
opened is at a point least prejudicial to the petitioner. Considering avoided by a roundabout way, or to secure the interest of the
that the petitioner operates a hotel and beach resort in its property, dominant owner, such as when the shortest distance would place
it must undeniably maintain a strict standard of security within its the way on a dangerous decline." 30
premises. Otherwise, the convenience, privacy, and safety of its
clients and patrons would be compromised. That indubitably will It is based on these settled principles that we have resolved this
doom the petitioner's business. It is therefore of great importance case.
that the claimed right of way over the petitioner's property be WHEREFORE, the decision dated May 30, 1986, and the
located at a point least prejudicial to its business. resolution dated October 27, 1987, of the respondent Court of
Hence, the private respondents' properties cannot be said to be Appeals are SET ASIDE and the private respondents' complaint is
isolated, for which a compulsory easement is demandable. Insofar hereby DISMISSED. Costs against the private respondents.
therefore as the Appellate Court declared the case to be proper as SO ORDERED.
a controversy for a compulsory right of way, this Court is ||| (Costabella Corp. v. Court of Appeals, G.R. No. 80511, [January
constrained to hold that it was in error. 25, 1991], 271 PHIL 350-362)
Servitudes of right of way are an ancient concept, which date back Encarnacion v. Court of Appeals 195 SCRA 74
to the iter, actus, and via of the Romans. 23 They are demanded THIRD DIVISION
by necessity, that is, to enable owners of isolated estates to make [G.R. No. 77628. March 11, 1991.]
full use of their properties, which lack of access to public roads has TOMAS ENCARNACION, petitioner, vs. THE HONORABLE
denied them. 24 Under Article 649 of the Civil Code, they are COURT OF APPEALS AND THE INTESTATE ESTATE OF THE
compulsory and hence, legally demandable, subject to indemnity LATE EUSEBIO DE SAGUN AND THE HEIRS OF THE LATE
and the concurrence of the other conditions above-referred to. ANICETA MAGSINO VIUDA DE SAGUN, * respondents.
As also earlier indicated, there must be a real necessity Esteban M. Mendoza for petitioner.
therefor, and not mere convenience for the dominant estate. Oscar Gozos for private respondents.
Hence, if there is an existing outlet, otherwise adequate, to the SYLLABUS
highway, the "dominant" estate cannot demand a right of way, 1. CIVIL LAW; EASEMENTS; RIGHT OF WAY; ABSENCE OF
although the same may not be convenient. Of course, the question ACCESS TO A PUBLIC ROAD. Where a private property has
of when a particular passage may be said to be "adequate" no access to a public road, it has the right of easement over
depends on the circumstances of each case. Manresa, however, adjacent servient estates as a matter of law.
says: "In truth, not only the estate which absolutely does not 2. ID.; ID.; ID.; WIDTH OF THE PASSAGE DETERMINED BY
possess it should be considered in this condition, but also that THE NEEDS OF THE DOMINANT PROPERTY. Under Article
which does not have one sufficiently safe or serviceable; an estate 651 of the Civil Code, it is the needs of the dominant property
bordering a public road through an inaccessible slope or precipice, which ultimately determine the width of the passage. And these
is in fact isolated for all the effects of the easement requested by needs may vary from time to time.
its owner. On the other hand, an estate which for any reason has 3. ID.; ID.; ID.; ID.; CASE AT BAR. When petitioner started out
necessarily lost its access to a public road during certain periods as a plant nursery operator, he and his family could easily make
of the year is in the same condition. . . . There are some who do with a few pushcarts to tow the plants to the national highway.
propound the query as to whether the fact that a river flows But the business grew and with it the need for the use of modern
between the estate and the public road should be considered as means of conveyance or transport. Manual hauling of plants and
having the effect of isolating the estate . . . If the river may be garden soil and use of pushcarts have become extremely
crossed conveniently at all times without the least danger, it cannot cumbersome and physically taxing. To force petitioner to leave his
be said that the estate is isolated; in any other case, the answer is jeepney in the highway, exposed to the elements and to the risk of
in the affirmative." 25 theft simply because it could not pass through the improvised
pathway, is sheer pigheadedness on the part of the servient estate
The isolation of the dominant estate is also dependent on the and can only be counter-productive for all the people concerned.
particular need of the dominant owner, and the estate itself need Petitioner should not be denied a passageway wide enough to
not be totally landlocked. What is important to consider is whether accommodate his jeepney since that is a reasonable and
or not a right of way is necessary to fill a reasonable need therefor necessary aspect of the plant nursery business.
by the owner. 2 6 Thus, as Manresa had pointed out, if the 4. ID.; ID.; ID.; PAYMENT OF INDEMNITY WHERE EASEMENT
passageway consists of an "inaccessible slope or IS CONTINUOUS AND PERMANENT. Where the easement to
precipice," 27 it is as if there is no passageway, that is, one that be established in favor of petitioner is of a continuous and
can sufficiently fulfill the dominant owner's necessities, although permanent nature, the indemnity shall consist of the value of the
by the existence of that passageway the property can not be truly land occupied and the amount of the damage caused to the
said that the property is isolated. So also, while an existing right of servient estate pursuant to Article 649 of the Civil Code.
DECISION meters or a difference of only 65 meters and that passage through
FERNAN, C.J p: defendants' land is more convenient for his (plaintiff's) business
Presented for resolution in the instant petition for review is the not- and family use are not among the conditions specified by Article
so-usual question of whether or not petitioner is entitled to 649 of the Civil Code to entitle the plaintiff to a right of way for the
a widening of an already existing easement of right-of-way. passage of his jeep through defendant's land." 3
Both the trial court and the Appellate Court ruled that petitioner is On appeal, the Court of Appeals affirmed the decision of the trial
not so entitled, hence the recourse to this Court. We reverse. court on January 28, 1987 and rejected petitioner's claim for an
FACTS: additional easement.
Petitioner Tomas Encarnacion and private respondent Heirs of the In sustaining the trial court, the Court of Appeals opined that the
late Aniceta Magsino Viuda de Sagun are the owners of two necessity interposed by petitioner was not compelling enough to
adjacent estates situated in Buco, Talisay, Batangas ** Petitioner justify interference with the property rights of private respondents.
owns the dominant estate which has an area of 2,590 square The Appellate Court took into consideration the presence of a
meters and bounded on the North by Eusebio de Sagun and dried river bed only eighty (80) meters away from the dominant
Mamerto Magsino, on the south by Taal Lake, on the East by estate and conjectured that petitioner might have actually driven
Felino Matienso and on the West by Pedro Matienzo. Private his jeep through the river bed in order to get to the highway, and
respondents co-own the 405-square-meter servient estate which that the only reason why he wanted a wider easement through the
is bounded on the North by the National Highway (Laurel Talisay De Sagun's estate was that it was more convenient for his
Highway), on the South by Tomas Encarnacion, on the East by business and family needs.
Mamerto Magsino and on the West by Felipe de Sagun. In other
words, the servient estate stands between the dominant estate HELD: GRANT ADDITIONAL EASEMENT
and the national road. After evaluating the evidence presented in the case, the Court
Prior to 1960, when the servient estate was not yet enclosed with finds that petitioner has sufficiently established his claim for an
a concrete fence, persons going to the national highway just additional easement of right of way, contrary to the conclusions of
crossed the servient estate at no particular point. However, in 1960 the courts a quo.
when private respondents constructed a fence around the servient While there is a dried river bed less than 100 meters from the
estate, a roadpath measuring 25 meters long and about a meter dominant tenement, that access is grossly inadequate. Generally,
wide was constituted to provide access to the highway. One-half the right of way may be demanded: (1) when there is absolutely
meter width of the path was taken from the servient estate and the no access to a public highway, and (2) when, even if there is one,
other one-half meter portion was taken from another lot owned by it is difficult or dangerous to use or is grossly insufficient. In the
Mamerto Magsino. No compensation was asked and none was present case, the river bed route is traversed by a semi-concrete
given for the portions constituting the pathway. 1 bridge and there is no ingress nor egress from the highway. For
It was also about that time that petitioner started his plant nursery the jeep to reach the level of the highway, it must literally jump four
business on his land where he also had his abode. He would use (4) to five (5) meters up. Moreover, during the rainy season, the
said pathway as passage to the highway for his family and for his river bed is impassable due to the floods. Thus, it can only be used
customers. at certain times of the year. With the inherent disadvantages of the
Petitioner's plant nursery business through sheer hard work river bed which make passage difficult, if not impossible, it is if
flourished and with that, it became more and more difficult for there were no outlet at all.
petitioner to haul the plants and garden soil to and from the nursery Where a private property has no access to a public road, it has the
and the highway with the use of pushcarts. In January, 1984, right of easement over adjacent servient estates as a matter of
petitioner was able to buy an owner-type jeep which he could use law. 4
for transporting his plants. However, that jeep could not pass With the non-availability of the dried river bed as an alternative
through the roadpath and so he approached the servient route to the highway, we transfer our attention to the existing
estate owners (Aniceta Vda. de Sagun and Elena Romero Vda. pathway which straddles the adjoining properties of the De Sagun
de Sagun) and requested that they sell to him one and one- heirs and Mamerto Magsino.
half (1 1/2) meters of their property to be added to the existing The courts below have taken against petitioner his candid
pathway so as to allow passage for his jeepney. To his utter admission in open court that he needed a wider pathway for the
consternation, his request was turned down by the two convenience of his business and family. (TSN, August 2, 1985, pp.
widows and further attempts at negotiation proved futile. 24-26). We cannot begrudge petitioner for wanting that which is
convenient. But certainly that should not detract from the more
Petitioner then instituted an action before the Regional Trial Court pressing consideration that there is a real and compelling need for
of Batangas, Branch 6 (Tanauan) to seek the issuance of a writ of such servitude in his favor.
easement of a right of way over an additional width of at least two Article 651 of the Civil Code provides that "(t)he width of the
(2) meters over the De Saguns' 405-square-meter parcel of land. 2 easement of right of way shall be that which is sufficient for
During the trial, the attention of the lower court was called to the the needs of the dominant estate, and may accordingly be
existence of another exit to the highway, only eighty (80) meters changed from time to time." This is taken to mean that under the
away from the dominant estate. On December 2, 1985, the lower law, it is the needs of the dominant property which ultimately
court rendered judgment dismissing petitioner's complaint. It ruled: determine the width of the passage. And these needs may vary
"It is clear, therefore, that plaintiff at present has two outlets to the from time to time. When petitioner started out as a plant nursery
highway: one, through the defendants' land on a one meter wide operator, he and his family could easily make do with a few
passageway, which is bounded on both sides by concrete walls pushcarts to tow the plants to the national highway. But the
and second, through the dried river bed eighty meters away. The business grew and with it the need for the use of modern means
plaintiff has an adequate outlet to the highway through the dried of conveyance or transport. Manual hauling of plants and garden
river bed where his jeep could pass. soil and use of pushcarts have become extremely cumbersome
"The reasons given for his claim that the one-meter passageway and physically taxing. To force petitioner to leave his jeepney in
through defendants' land be widened to two and one-half meters the highway, exposed to the elements and to the risk of theft simply
to allow the passage of his jeep, destroying in the process one of because it could not pass through the improvised pathway, is
the concrete fences and decreasing defendants' already small sheer pigheadedness on the part of the servient estate and can
parcel to only about 332.5 square meters, just because it is nearer only be counter-productive for all the people concerned. Petitioner
to the highway by 25 meters compared to the second access of 80 should not be denied a passageway wide enough to accommodate
his jeepney since that is a reasonable and necessary aspect of the of Binondo, consists of a parcel of land and the building erected
plant nursery business. thereon bearing Nos. 142 and 152; it is bounded on the northwest,
approximately, by the estero of Santa Cruz and the property of
We are well aware that an additional one and one-half (11/2) Carmen de Ayala de Roxas; on the southeast by the River Pasig;
meters in the width of the pathway will reduce the servient estate on the southwest by the property of the heirs of Tuason and
to only about 342.5 square meters. But petitioner has expressed Santibaez; and on the northwest by Calle Escolta and the
willingness to exchange an equivalent portion of his land to aforesaid property of Carmen de Ayala de Roxas; that the total
compensate private respondents for their loss. Perhaps, it would area is 3,251.84 square meters, its description and boundaries
be well for respondents to take the offer of petitioner being detailed in the plan attached to the petition; that according
seriously. 5 But unless and until that option is considered, the law to the last assessment made for the purposes of taxation the land
decrees that petitioner must indemnify the owners of the servient was valued at P170,231 and the buildings thereon at P30,000; that
estate including Mamerto Magsino from whose adjoining lot 1/2 the property is free from all incumbrance, and no one has any
meter was taken to constitute the original path several years ago. interest therein or right thereto; that on the northeast side the
Since the easement to be established in favor of petitioner is of a property had in its favor the right of easement over some 234.20
continuous and permanent nature, the indemnity shall consist of square meters of land owned by the said Ayala de Roxas, and that
the value of the land occupied and the amount of the damage the applicant acquired the property by succession from Doa
caused to the servient estate pursuant to Article 649 of the Civil Clotilde Romree.
Code which states in part: In the written opposition above alluded to, counsel for the heirs of
"Art. 649. The owner, or any person who by virtue of a real right Pablo Tuason and Leocadia Santibaez alleged that the parties
may cultivate or use any immovable, which is surrounded by other whom he represents are owners in common of the property
immovables pertaining to other persons and without adequate adjoining that of the petitioner on the southwest; that the latter, in
outlet to a public highway, is entitled to demand a right of way making the plan attached to his petition, extended his southwest
through the neighboring estates, after payment of the proper boundary line to a portion of the lot of the said heirs of Tuason and
indemnity. Santibaez in the form indicated by the red line in the annexed
"Should this easement be established in such a manner that its plan; that the true dividing line between the property of the
use may be continuous for all the needs of the dominant estate, petitioner and that of the said heirs is the walls indicated in black
establishing a permanent passage, the indemnity shall consist of ink on the accompanying plan; that said walls belong to the
the value of the land occupied and the amount of the damage opponents, and that about two years ago, when the applicant
caused to the servient estate. made alterations in the buildings erected on his land, he
xxx xxx xxx" improperly caused a portion of them to rest on the wall owned by
WHEREFORE, in conformity with the foregoing discussion, the the parties whom he represents, at points 12, 13, and 14 of said
appealed decision of the Court of Appeals dated January 28, 1987 plan; for which reason the opponent prayed the court to direct the
is REVERSED and SET ASIDE. Petitioner Tomas Encarnacion is applicant to amend the line marked in his plan with the letters Y,
hereby declared entitled to an additional easement of right of way X, U, T, S, and R, so that it may agree with the wall indicated by
of twenty-five (25) meters long by one and one-half (11/2) meters the numbers 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, and 14 on the
wide over the servient estate or a total area of 62.5 square meters plan which accompanist the written opposition, reducing the area
after payment of the proper indemnity. to whatever it may be after the amendment has been made; that
SO ORDERED. the applicant be compelled to remove the supports that he placed
||| (Encarnacion v. Court of Appeals, G.R. No. 77628, [March 11, for his buildings on the wall of the representatives of the petitioner,
1991], 272-A PHIL 27-33) and that he be sentenced to pay the costs.
Case v. Heirs of Tuason 14 Phil. 521 The case was brought to trial, both parties adduced evidence, and
FIRST DIVISION their exhibits were made of record. The court, assisted by the
[G.R. No. 5044. December 1, 1909.] interested parties and their respective experts, made an inspection
EDWIN CASE, petitioner-appellant, vs. THE HEIRS OF TUASON of the two properties, in view of which it entered judgment on the
Y SANTIBAEZ, opponents-appellees. 31st of July, 1908, sustaining the opposition offered by the
Hartigan & Rohde, and Roman Lacson for appellant. representative of the heirs of Pablo Tuason and Leocadia
Rosado, Sanz & Opisso for appellees. Santibaez, and after declaring a general default granted the
SYLLABUS registration of the property described in the application filed by
1. REALTY; EASEMENTS; PRESUMPTIONS WITH RESPECT Edwin Case, with the exclusion of the wall claimed by the
TO PARTY WALLS. The legal presumption of the existence of opponents and shown on their plan by the lines numbered 1, 2, 3,
an easement of a party wall is limited to the three cases contained 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, and 14; and in view of the fact that
in article 572 of the Civil Code, and is that of juris tantum; this must lines drawn on the plan offered in evidence by the applicant under
be accepted unless the contrary should appear from the title deeds letter G. are not correctly drawn, once this decision shall have
of the adjoining properties, that is to say, that the entire wall in become final, let the dividing line of both properties be fixed by
question belongs to one of the property owners, or, while there is common accord between the two parties and their experts, taking
no exterior sign to destroy such presumption and to support a as a base for the same the amended line of walls drawn on the
presumption against the party wall. (Art. 573, Civil Code.) plan of the opponents, but should they not reach an agreement a
DECISION surveyor of the Court of Land Registration shall be detailed to fix
TORRES, J p: the same at the expense of the parties; the court also ordered the
On the 7th of December, 1906, the attorneys for Edwin Case filed cancellation of the registration shall be detailed to fix the same at
a petition with the Court of Land Registration requesting that the the expense of the parties; the court also ordered the cancellation
property owned by the applicant, described in the petition, be of the registration entries of the property entered in the name of
registered in accordance with the provisions of the Land Clotilde Romree, principal of the petitioner, at page 142 and those
Registration Act. After a written opposition was presented by following of volume 15, section of Binondo and 52 of the register,
Felipe R. Caballero on the 6th of June, 1907, on behalf of the heirs property No. 828, first entry.
of the late Pablo Tuason and Leocadia Santibaez, counsel for the
applicant, Case, on August 2, 1907, amended the original petition On the 12th of August, 1908, the petitioner moved for the new trial
and set forth: that said property, situated in Calle Escolta, district on the ground that the evidence was not sufficient to justify the
decision of the court in excluding the wall claimed by the The intermediate portion of the wall in question, lying between
opponents; that said decision was contrary to the law, in so far as numbers 6 and 13 on the defendants' plan, equivalent to a little
it excludes the said decision was contrary to the law, in so far as it more than numbers 30 to 25 on the plan of the petitioner, is the
excludes the said wall, and that the conclusions of fact therein are portion against which no other wall appears to have been erected
openly and manifestly contrary to the weight of the evidence in so on the land owned by Mr. Case. In spite of this it cannot be
far as they referred to the exclusion of said wall. The said motion presumed that the aforesaid portion was a party wall, and that it
was overruled on the 15th of the same month, to which overruling was not exclusively owned by the defendants, inasmuch as the
the applicant excepted and announced his intention to perfect the latter have proven by means of a good title that has not been
corresponding bill of exceptions which was filed, approved, and impugned by the petitioner, that when one of their ancestors and
submitted to this court together with the proper assignment of principals acquired the property the lot was already inclosed by the
errors. wall on which the building was erected; it must therefore be
It the appeal interposed by the applicant against the decision of understood that in the purchase of the property the wall by which
the Court of Land Registration, now before this court, the the land was inclosed was necessarily included.
questions set up are merely of fact.
The above documentary evidence has not been overcome by any
The question is whether the wall that with slight interruption runs other presented by the petitioner, by apart from the record
from Calle Escolta to the River Pasig, and which divides the discloses the existence of certain unquestionable signs. These
adjoining properties of the applicant, Edwin Case, and of the consist of constructions made by the petitioner himself on his own
opponents, belongs to the former, as he claimed in the first property which entirely destroy any presumption that it is a party
instance, or is a dividing wall as affirmed in his brief in this second wall, and indeed gives rise to a presumption against it.
instance, or is the property of the said opponents, the heirs of the
late Tuason and Santibaez. Three openings have been made in the wall, undoubtedly to allow
the passage of air and light. Two of them are beveled on the side
The trial court after considering the evidence adduced by both toward the land of the objectors, and the third had recently
parties to the suit, found that the wall in controversy belongs to the imbedded in the wall on the side of the property of the opponents.
opponents for the reason, among others that in the public These things constitute exterior signs and were recorded as the
document by which one of their original ancestors acquired on the result of personal inspection by the trial court in company with the
19th of April, 1796, the property now possessed by them, it experts of both parties. These signs positively and conclusively
appears that the property was then already inclosed by a stone prove that the said wall is not a party wall, but the exclusive
wall. This document, which was offered in evidence by the property of the defendant. This is further confirmed by the
opponents, has not been impugned by the applicant. On the testimony of the witnesses at the trial.
contrary, it was acknowledged as the title deed of the property
adjoining that of the applicant by the witness Juan B. Tuason, who The fact that the petitioner built a wall and backed it against the
knows the one and the other. one in question to support the edifice he had constructed between
It is fully proven that two walls extend from Calle Escolta to the points 21 and 13 of the corrected plan is a further indication that
interior of both properties, the one backing the other, and which the neighboring wall is not a party one. He knew perfectly well that
respectively support the edifices of the petitioner and of the he had no right to rest his building on the latter. That he built a
opponents from points 36, 35, 34, 33, 32, 31, and 30 on the plan terrace about four years previously over the wall between points
of the petitioner corresponding to points 1 to 6 on that of the 30, 29, 28, and 27 does not prove that the whole of the wall, from
opponents. the Escolta to the Rive Pasig, is a party wall, but it does show that
This section of the wall of the opponents embraced within the he usurped a portion thereof to the prejudice of the real owner.
points mentioned in the plans offered in evidence by the parties,
for the very reason that it supports only the property of the Neither can it be presumed that part of the wall bordering on the
opponents and not that of the petitioner, cannot be a party wall, River Pasig comprised between points 13 and 14 is a party wall. It
one-half of which along its entire length would belong to the was shown in the proceedings as resulting from the above-
adjoining building owned by Mr. Case. There is not sufficient proof mentioned ocular inspection that at the side of the said wall, which
to sustain such claim, and besides, the building erected thereon is rather a low one, there is another, a higher one erected on the
disproves the pretension of the petitioner. petitioner's land and backed against the one in question. The first
It should, however, be noted that portion of the wall between the one, as has been said, forms part of that which has surrounded
numbers 3, 4, 5, and 6 on the plan of the opponents, which the property from the date of its acquisition, more than a century
corresponds to numbers 33, 32, 31, and 30 of that of the petitioner, ago, until the present date. It is absolutely independent of the built
and which constitutes the cesspool on the property of the latter, by the petitioner, and that it is the exclusive property of the
belongs to him, and it has so been admitted by counsel for the objectors and is not a party wall cannot be denied.
opponents, for the reason that the petitioner had acquired it by It therefore appears from the proceedings that, with the exception
prescription, the opponents having lost control over the area of of the small portion of the wall in question occupied by the latrine
land covered by the said cesspool together with the walls that on the property of the petitioner, and which the opponents admit
inclose it. that he had acquired by prescription, the whole of said wall from
the Escolta to the River Pasig cannot be presumed to be a party
Under article 572 of the Civil Code the easement of party walls is wall; the evidence to the contrary conclusively proves that it
presumed, unless there is a title or exterior sign, or proof to the belonged exclusively to the defendants, and it has been further
contrary, among others, in dividing walls of adjoining buildings up shown in the case that at one time an old building belonging to the
to the common point of elevation. opponents used to rest on a portion of the wall near the river.
The legal presumption as to party walls is limited to the three cases In view of the foregoing, and considering that the judgment
dealt with in the said article of the code, and is that of juris appealed from is in accordance with the law and the merits of the
tantum unless the contrary appear from the little of ownership of case, it is our opinion that the same should be affirmed in full, as
the adjoining properties, that is to say, that the entire wall in we do hereby affirm it, with the costs against the petitioner. So
controversy belongs to one of the property owners, or where there ordered.
is no exterior sign to destroy such presumption and support a ||| (Case v. Heirs of Tuason y Santibaez, G.R. No. 5044,
presumption against the party wall. (Art. 573, Civil Code.) [December 1, 1909], 14 PHIL 521-528)
"The law provides that the owner of a wall which is not a party wall,
Choco v. Santamaria 21 Phil. 132 adjoining another's estate, may make in it windows or openings to
FIRST DIVISION admit light at the height of the ceiling joists, or immediately under
[G.R. No. 6076. December 29, 1911.] the ceiling, thirty centimeters square, with an iron grate embedded
SEVERINA and FLORA CHOCO, plaintiffs-appellants, vs. in the wall and a wire screen.
ISIDRO SANTAMARIA, defendant-appellant. "In this case the windows are in a wall not a party wall adjoining
Manuel Torres for plaintiffs. plaintiff's estate, and the windows marked 2, 3, and 4, as appears
Leodegario Azarraga for defendant. on Exhibit A, are less than thirty centimeters square and have a
SYLLABUS wire screen, but there does not appear to be the iron grate
1. REALTY; EASEMENTS; LIGHT, AIR, AND VIEW. Windows embedded in the wall.
with direct views, or balconies or any similar openings projecting "The windows marked 5 and 6, as indicated on Exhibit A, have a
over the estate of a neighbor, cannot be made if there is not a wire screen but are more than thirty centimeters square, and have
distance of at least 2 meters between the wall in which they are not the iron grate embedded in the wall.
built and the said estate. Neither can side nor oblique views be "The window marked 7 on Exhibit A has a wire screen, but is more
opened over said property, unless there is a Distance of 60 than 30 centimeters square and has not the iron grate embedded
centimeters. (Art. 582, Civil Code.) in the wall.
2. ID.; ID.; ID. The owner of a wall which is not a party wall, "The windows 8 and 9, as indicated on Exhibit A, have a wire
adjoining another's estate, may make in it windows or openings to screen but no iron grate embedded in the wall, and are of a greater
admit light, at the height of the ceiling joists or immediately under dimension than thirty centimeters square.
the ceiling, of the dimensions of 30 centimeters square and, in any "The window marked One on Exhibit A is located in a balcony
case, with an iron grate embedded in the wall and a wire screen. which overlooks the street, and, while the premises of the plaintiff
(Art. 581, Civil Code.) may be seen from it, it is not adjoining their estate.
DECISION "The court finds that the plaintiffs are entitled to a decree for
MAPA, J p: closing all the windows or openings in the walls of the defendant's
The judgment rendered in this case in first instance is in part as house, as hereinbefore described, which directly overlook the
follows: premises of the plaintiffs, or that in some other way the provisions
"From the evidence presented at the trial, I find that the defendant of the law be complied with so that they may remain open.
is in possession of a parcel of land on the corner of Calles "All these openings and windows can be made to comply with the
Pescadores and P. Rada, in the district of Tondo, city of Manila, law, with the exception of that marked 7, which is not immediately
and that he has erected a house thereon flush with the boundary under the ceiling (techo).
line of the adjacent property; that the plaintiffs are the owners of "Let judgment be entered in favor of the plaintiffs, Severina and
the land on both sides of defendant's house, erected as stated, Flora Choco, and against the defendant, Isidro Santamaria,
both on Calle Pescadores and Calle P. Rada; that the defendant forever prohibiting the opening of the window marked No. 7, as
in the building of his house has made several openings and hereinbefore stated, which must be closed, and forever prohibiting
windows in the walls of the house on both sides overlooking the the opening of the windows and openings marked, as hereinbefore
property of the plaintiffs' that at the time the defendant was building stated, 2, 3, 4, 5, 6, 8, and 9, which must be closed or made to
his house, and the windows and openings were being made, the conform to the requirements of law with regard to dimensions and
plaintiffs protested, and later on and in the year 1905 made written an iron grate embedded in the wall, with the costs of the action.''
protest and demand on the defendant, and the defendant received
the written protest and referred it to his counsel, who, from the The plaintiffs appealed from that judgment and allege in their
evidence, appears to have suggested an amicable adjustment of appeal in this instance:
the matter, but the adjustment was not made, and this action was 1. That the lower court erred by not ordering in his judgment the
brought. final and perpetual closing of the large window opened in the
"It is likewise established that the entrance to the defendant's balcony of the back part of the appellee's house and marked No.
house is in Calle Pescadores, and taking it as the front of his house 1 in the photographic Exhibits A and D, on the ground that the said
he has put a large window in its upper story, on the balcony of said window is in the balcony which overlooks Calle Padre Rada and
house, marked 1 on Exhibit A, overlooking Calle P. Rada; and that that, though the appellants' lot can be seen from this window, it is
this window and its balcony do not face directly toward the house not contiguous to the latter's property.
of the plaintiffs. 2. That the trial court also erred in ordering in his judgment that the
"There have also been constructed two windows in the rear wall of openings and windows, Nos. 2, 3, 4, 5, 6, 8, and 9, might continue
the house of the defendant, in the first story of the house, which open if they were fixed so as to comply with the requirements of
are marked 8 and 9 on Exhibit A, and these windows are each 50 the law as regards their dimensions and the placing of iron grates
by 80 centimeters, and are placed immediately under the ceiling embedded in the wall.
of the first story, and each of these windows is equally divided into 3. That the lower court also erred in denying the appellants'
four panes. petition for a rehearing.
"On the right hand side of the house, entering from Calle
Pescadores, there is a window or opening in the wall of the house It appears obvious to us, from the evidence, that the window No.
in the second story, which is about 25 by 35 centimeters, and is 1, referred to in the first assignment of errors, is next to the
located a little more than half way from the floor of the ceiling of appellants' lot. To judge from the photographic views, Exhibits A
the second story and this is subdivided into smaller panes; and on and D, it opens on the boundary line between the said lot and that
the same side there are three windows which are marked 2, 3, and of the appellee and is situated perpendicularly above a part of the
4 on Exhibit A, located immediately under the ceiling of the first wall that belongs to the appellants. This opinion is corroborated by
story, and each of the three is 25 by 25 centimeters. the testimony of the defendant's witness who took the said
"There are two other windows on the same side located photographs, in so far as he said that "a part of the window in
immediately under the ceiling, which are marked 5 and 6 on Exhibit question is in front of the plaintiffs' property, and a person
A and also on Exhibit C, and one of these windows is about 35 by approaching the window may clearly see the said lot." And
67 centimeters, and the other about 75 by 90 centimeters. certainly if it is in front of this lot, it is unquestionable that it directly
"It also appears that there is wire screening over all these openings overlooks the same; but even though it did not and only a side or
or windows. oblique view of the lot could be obtained from it, it could not be
kept open, since between it and the plaintiffs' property there does Nor is their definition exact of the word joists, as it is employed in
not intervene the distance required by law that of two meters in article 581 of the Code. According to the dictionary of the Spanish
the first case, and 60 centimeters in the second. In reality, there is Academy, these are, in architecture, understood to be a kind of
no distance at all between the said window and the plaintiffs' lot, beam laid horizontally and serving in buildings to support others or
because, as we have said, this window is perpendicular to the for bracing and connecting the parts of the structure. Mucius
boundary line of the said lot; therefore, its opening is a manifest Scaevola says in his Civil Code, volume 10, page 448:
violation of the provisions of article 582 of the Civil Code which "The horizontal timbers that are placed upon the tops of the
reads as follows: uprights, that is, what are commonly called beams, intended to
"Windows with direct views, or balconies or any similar openings serve for connection and main support of the timbers of the
projecting over the estate of the neighbor, cannot be made if there different floors that separate the stories of the building, are called
is not a distance of, at least, 2 meters between the wall in which joists."
they are built and said estate.
"Neither can side nor oblique views be opened over said property, According to these definitions each floor necessarily has joists,
unless there is a distance of 60 centimeters." that is, beams, since, in the last analysis they are what support
Because of the lack of the distance required by law, the window in and secure the structure of the story immediately above; therefore
question must be closed, and consequently the judgment it is not true that there may be joists only in the top story, as the
appealed from should be modified in this sense, as regards this appellants claim by saying that they understand to be such the
window. long timbers to which are fastened the boards of the ceiling at the
top story of the building. On the contrary, carefully considered, it is
With respect to the second assignment of error, the question precisely the top story that does not need joists since it does not
raised by the appellants concerns the proper interpretation of have to support any other higher portion of the building. It has only
article 581 of the Civil Code which prescribes as follows: to support the weight of the roof, which is undoubtedly much less
"The owner of a wall which is not a party-wall, adjoining another's than that of a whole story. So that, according to Mucius Scaevola
estate, may make in it windows or openings to admit light, at the (work cited, vol. 10, p. 487), it cannot be said that the top story has
height of the ceiling joists or immediately under the ceiling, of the joists. And because it certainly does not have them, is the reason
dimensions of 30 centimeters square and, in any case, with an iron why the code in said article 581 employs the phrase
grate embedded in the wall and a wire screen." or immediately under "los techos" in referring to the top story.
The windows mentioned in this part of the appeal are those The author's words in expounding this theory in his commentary
indicated by Nos. 2, 3, 4,5, 6, 8, and 9, in the defendant's Exhibit on article 581 of the Civil Code are as follows:
A. They are all situated immediately under the ceiling of the first "We said elsewere that these (the joists) were the horizontal
floor and are provided with wire screens; some of them measure timbers that rest upon the tops of the uprights; they form, then, the
more and others less than 30 centimeters square and none of upper limit of the different stories of a house; and therefore, in
them have iron grates embedded in the wall. Owing to this last referring to the top story, which cannot be said to have joists,
circumstance, none of them fully comply with the conditions article 581 makes use of the phrase or immediately under 'los
required by law; moreover, those numbered 5, 6, 8, and 9, have techos.'"
the additional defect of being greater than 30 centimeters square. This does not mean that the italicized phrase refers solely and
The trial judge therefore ordered, in the judgment, that all the exclusively to the top story, since the lower stories also have
aforementioned windows be closed or that they be made to techos, as above set forth. In our opinion what the author cited
conform to the law with respect to their dimensions and the placing means is that in speaking of the top story, which has no joists, the
of iron grates embedded in the wall. The appellants maintain that words of article 581 of the code, at the height of the ceiling joists,
these windows should have been ordered closed absolutely and fail to apply, the phrase or immediately under "los tecllos" alone
finally, and, consequently, that the option allowed the defendant to being thereto applicable, in distinction from the lower stories, with
keep them open, provided that he brought them within the terms regard to which both phrases are applicable as they have at the
of the law, is contrary to the same and, therefore, illegal. same time joists and techo. In referring to the lower stories either
phrase may, in connection with the other, determine the place,
It is alleged as a ground for such averment that none of the which surely cannot be more than one, where it is permissible to
windows referred to are at the height of the ceiling joists, which is open the windows called regulation windows, whenever in them
the first condition required by law. the joists are actually joined to or placed next to the techo which
"We understand by ceiling joists say the appellants in a forms the top of each of said stories. Both phrases therefore
building composed of any given number of stories, the long pieces express the same idea with reference to the lower stories.
to which are nailed the boards that form the ceiling of the last story
of the building, counting the stories from below; and this Aside from what has been said here, the object of the law in
interpretation which we give to the words ceiling joists must be that authorizing the opening of the windows in question in all the stories
most in harmony with the spirit of article 581 of the code, the of a building, without any exception, is clear. Their purpose is, as
subject of our examination, since immediately after them in the article 581 itself says, to furnish light to the rooms, and it is evident
same article, in explanation, are found the words or immediately at a glance that the rooms of the lower stories have as much need
under 'los techos,' in order to indicate, without the least doubt, the for light as those of the top story. No good reason exists for having
sole place or height where openings or windows may be made in one story in better condition than another, whichever it may be, in
conformity with the law. It is needless to say that a building, though connection with this provision of law.
composed of several stories, can have but one techo. . . ."
This last assertion is incorrect. By techo is understood that part of The defendant is ordered to close finally and forever the window
a construction which covers the rooms under it and certainly forms marked No. 1 in Exhibit A, the judgment appealed from in so far
one of the essential parts of every story. A story is composed of as it refers to said window being thus modified, but affirmed in all
earth, pavement and ceiling, the latter, that is, the ceiling, being other respects; without special finding as to costs in this instance.
that part of the story that is visible to the observer situated below ||| (Choco v. Santamaria, G.R. No. 6076, [December 29, 1911], 21
in the room covered by it. (Hispano-American Encyclopedic PHIL 132-140)
Dictionary, by Montaner and Simon.) Consequently, every story
has a ceiling, and not, as the appellants maintain, the upper one Solid Manila Corporation v. Bio Hong Trading Co., Inc. 195 SCRA
alone. 748
SECOND DIVISION The private respondent's title came from a prior owner, and in their
[G.R. No. 90596. April 8, 1991.] deed of sale, the parties thereto reserved as an easement of way:
SOLID MANILA CORPORATION, petitioner, vs. BIO HONG . . . a portion thereof measuring NINE HUNDRED FOURTEEN
TRADING CO., INC. and COURT OF APPEALS, respondents. SQUARE METERS, more or less, had been converted into a
Balgos & Perez for petitioner. private alley for the benefit of neighboring estates, this being duly
Alfredo G. de Guzman for private respondent. annotated at the back of the covering Transfer Certificate of Title
SYLLABUS per regulations of the Office of the City Engineer of Manila and that
1. CIVIL LAW; PROPERTY; OWNERSHIP AND ITS the three meterwide portion of said parcel along the Pasig River,
MODIFICATIONS; EASEMENTS OR SERVITUDES; NATURE, with an area of ONE HUNDRED SEVENTY NINE (179) SQUARE
CONSTRUED. Servitudes are merely accessories to the METERS, more or less, had actually been expropriated by the City
tenements of which they form part. Although they are possessed Government, and developed pursuant to the beautification drive of
of a separate juridical existence, as mere accessories, they can the Metro Manila Governor. (p. 3, Record). 2
not, however, be alienated from the tenement, or mortgaged As a consequence, an annotation was entered in the private
separately. respondent's title, as follows:
2. ID.; ID.; ID.; A LIMITATION ON THE RIGHT OF THE OWNER Entry No. 7712/T-5000 CONSTRUCTION OF PRIVATE ALLEY
TO USE. An easement operates as a limitation on the title of It is hereby made of record that a construction of private alley
the owner of the servient estate, specifically, his right to use ( jus has been undertaken on the lot covered by this title from
utendi). Concepcion Street to the interior of the aforesaid property with the
3. ID.; ID.; ID.; MODES OF EXTINGUISHMENT; MERGER, plan and specification duly approved by the City Engineer subject
DEFINED. A merger exists when ownership of the dominant to the following conditions to wit: (1) That the private alley shall be
and servient estates is consolidated in the same person. Merger at least three (3) meters in width; (2) That the alley shall not be
then, as can be seen, requires full ownership of both estates. closed so long as there's a building exists thereon (sic); (3) That
4. ID.; ID.; ID.; PERSONAL SERVITUDE; CONSTRUED. A the alley shall be open to the sky; (4) That the owner of the lot on
personal servitude, is one constituted not in favor of a particular which this private alley has been constituted shall construct the
tenement (a real servitude) but rather, for the benefit of the general said alley and provide same with concrete canals as per
public. In a personal servitude, there is therefore no "owner of a specification of the City Engineer; (5) That the maintenance and
dominant tenement" to speak of, and the easement pertains to upkeep of the alley shall be at the expense of the registered owner;
persons without a dominant estate, in this case, the public at large. (6) That the alley shall remain open at all times, and no
5. REMEDIAL LAW; ACTIONS; SUMMARY JUDGMENT; WHEN obstructions whatsoever shall be placed thereon; (7) That the
PROPER. Summary judgments under Rule 34 of the Rules of owner of the lot on which the alley has been constructed shall allow
Court are proper where there is no genuine issue as to the the public to use the same, and allow the City to lay pipes for sewer
existence of a material fact, and the facts appear undisputed and drainage purposes, and shall not act (sic) for any indemnity
based on the pleadings, depositions, admissions, and affidavits of for the use thereof; and (8) That he shall impose upon the vendee
record. or new owner of the property the conditions abovementioned;
6. ID.; ID.; ID.; PURPOSE. Summary judgments are meant to other conditions set forth in Doc. No. 4236, Page No. 11, Book No.
rid a proceeding of the ritual of a trial where, from existing records, 84 of Nicasio P. Misa, Not. Pub. of Manila. 3
the facts have been established, and trial would be futile.
7. ID.; ID.; LAW OF THE CASE; CONSTRUED. "Law of the The petitioner claims that ever since, it had (as well as other
case" has been defined as the opinion delivered on a former residents of neighboring estates) made use of the above private
appeal. More specifically, it means that whatever is once alley and maintained and contributed to its upkeep, until sometime
irrevocably established as the controlling legal rule of decision in 1983, when, and over its protests, the private respondent
between the same parties in the same case continues to be the constructed steel gates that precluded unhampered use.
law of the case, whether correct on general principles or not, so On December 6, 1984, the petitioner commenced suit for
long as the facts on which such decision was predicated continue injunction against the private respondent, to have the gates
to be the facts of the case before the court. (21 C.J.S. 330) removed and to allow full access to the easement.
8. ID.; ID.; FORUM SHOPPING. There is forum-shopping
whenever, as a result of an adverse opinion in one forum, a party The court a quo shortly issued ex parte an order directing the
seeks a favorable opinion (other than by appeal or certiorari) in private respondent to open the gates. Subsequently, the latter
another. The principle applies not only with respect to suits filed in moved to have the order lifted, on the grounds that: (1) the
the courts but also in connection with litigations commenced in the easement referred to has been extinguished by merger in the
courts while an administrative proceeding is pending. same person of the dominant and servient estates upon the
DECISION purchase of the property from its former owner; (2) the
SARMIENTO, J p: petitioner has another adequate outlet; (3) the petitioner has not
This is an appeal filed by way of a petition for review on certiorari paid any indemnity therefor; and (4) the petitioner has not shown
under Rule 45 of the Rules of Court. that the right-of-way lies at the point least prejudicial to the servient
estate.
The petitioner raises two questions: The private respondent's opposition notwithstanding, the trial court
(1) whether or not the Court of Appeals 1 erred in reversing the issued a "temporary writ of preliminary injunction to continue up to
trial court which had rendered summary judgment; and the final termination of the case upon its merits upon the posting
(2) whether or not it erred in holding that an easement had of a P5,000.00 bond by the plaintiff" 4 (the petitioner herein).
been extinguished by merger. Thereafter, the respondent corporation answered and reiterated
We rule for the petitioner on both counts. its above defenses.
On April 15, 1986, the petitioner moved for summary judgment and
It appears that the petitioner is the owner of a parcel of land located the court a quo ruled on the same as follows:
in Ermita, Manila, covered by Transfer Certificate of Title No. In view of the foregoing, this Court finds it unnecessary to try this
157750 of the Register of Deeds of Manila. The same lies in the case on the merit (sic) and hereby resolve (sic) to grant the
vicinity of another parcel, registered in the name of the private plaintiff's motion for summary judgment. (pp. 15-107, Record). 5
respondent corporation under Transfer Certificate of Title No. On January 19, 1987, the trial court rendered judgment against the
128784. private respondent, the dispositive portion of which states:
WHEREFORE, judgment is hereby rendered making permanent Servitudes are merely accessories to the tenements of which they
the temporary mandatory injunction, that had been issued against form part. 10 Although they are possessed of a separate juridical
the defendant, and for the defendant to pay the plaintiff the costs existence, as mere accessories, they cannot, however, be
of this suit. alienated 12
The defendant's counterclaim against the plaintiff is hereby The fact, however, that the alley in question, as an easement, is
dismissed, for lack of merit. (Summary Judgment, p. 6). 6 inseparable from the main lot is no argument to defeat the
The private respondent appealed to the respondent Court of petitioner's claims, because as an easement precisely, it operates
Appeals. as a limitation on the title of the owner of the servient estate,
Meanwhile, the private respondent itself went to the Regional Trial specifically, his right to use (jus utendi).
Court on a petition for the cancellation of the annotation in As the petitioner indeed hastens to point out, the deed itself
question. The court granted cancellation, for which the petitioner stipulated that "a portion thereof [of the tenement] measuring NINE
instituted CA-G.R. SP No. 13421 of the respondent Court of HUNDRED FOURTEEN SQUARE METERS, more or less, had
Appeals which ordered the restoration of the annotation "without been converted into a private alley for the benefit of the
prejudice [to] the final outcome of" 7 the private respondent's own neighboring estates . . ." 13 and precisely, the former owner, in
appeal (subject of this petition). conveying the property, gave the private owner a discount on
In reversing the trial court which had, as earlier mentioned, account of the easement, thus:
rendered summary judgment, the respondent Court of Appeals WHEREAS, to compensate for the foregoing, the parties hereto
held that the summary judgment was improper and that the lower agreed to adjust the purchase price from THREE MILLION SEVEN
court erroneously ignored the defense set up by the private HUNDRED NINETY THOUSAND FOUR HUNDRED FORTY
respondent that the easement in question had been extinguished. PESOS (P3,790,440.) to THREE MILLION FIVE HUNDRED
According to the Appellate Court, an easement is a mere limitation THREE THOUSAND TWO HUNDRED FORTY PESOS
on ownership and that it does not impair the private respondent's (P3,503,240.00) 14
title, and that since the private respondent had acquired title to the Hence, and so we reiterate, albeit the private respondent did
property, "merger" brought about an extinguishment of the acquire ownership over the propertyincluding the disputed alley
easement. as a result of the conveyance, it did not acquire the right to
The petitioner submits that the respondent Court of Appeals erred, close that alley or otherwise put up obstructions thereon and
because the very deed of sale executed between the private thus prevent the public from using it, because as a servitude,
respondent and the previous owner of the property "excluded" the the alley is supposed to be open to the public.
alley in question, and that in any event, the intent of the parties The Court is furthermore of the opinion, contrary to that of the
was to retain the "alley" as an easement notwithstanding the sale. Court of Appeals, that no genuine merger took place as a
consequence of the sale in favor of the private respondent
HELD: corporation. According to the Civil Code, a merger exists when
As already stated at the outset, the Court finds merit in the petition. ownership of the dominant and servient estates is consolidated in
There is no question that an easement, as described in the deed the same person. 15 Merger then, as can be seen, requires full
of sale executed between the private respondent and the seller, ownership of both estates.
had been constituted on the private respondent's property, and One thing ought to be noted here, however. The servitude in
has been in fact annotated at the back of Transfer Certificate of question is a personal servitude, that is to say, one constituted not
Title No. 128784. Specifically, the same charged the private in favor of a particular tenement (a real servitude) but rather, for
respondent as follows: "(6) That the alley shall remain open at all the benefit of the general public.
times, and no obstructions whatsoever shall be placed thereon; (7) Personal servitudes are referred to in the following article of the
That the owner of the lot on which the alley has been constructed Civil Code:
shall allow the public to use the same, and allow the City to lay Art. 614. Servitudes may also be established for the benefit of a
pipes for sewer and drainage purposes, and shall not [ask] for any community, or of one or more persons to whom the encumbered
indemnity for the use thereof . . . " 8 Its act, therefore, of erecting estate does not belong. 16
steel gates across the alley was in defiance of these conditions In a personal servitude, there is therefore no "owner of a
and a violation of the deed of sale, and, of course, the servitude of dominant tenement" to speak of, and the easement pertains
way. to persons without a dominant estate, 17 in this case, the
public at large.
The Court then is of the opinion that injunction was and is proper Merger, as we said, presupposes the existence of a prior
and in denying injunctive relief on appeal, the respondent servient-dominant owner relationship, and the termination of
Appellate Court committed an error of judgment and law. that relation leaves the easement of no use. Unless the owner
It is hardly the point, as the Court of Appeals held, that the private conveys the property in favor of the public if that is
respondent is the owner of the portion on which the right-of-way possible no genuine merger can take place that would
had been established and that an easement cannot impair terminate a personal easement.
ownership. The petitioner is not claiming the easement or any part For this reason, the trial court was not in error in rendering
of the property as its own, but rather, it is seeking to have the summary judgment, and insofar as the respondent Court of
private respondent respect the easement already existing thereon. Appeals held that it (the trial court) was in error, the Court of
The petitioner is moreover agreed that the private respondent has Appeals is in error.
ownership, but that nonetheless, it has failed to observe the Summary judgments under Rule 34 of the Rules of Court are
limitation or encumbrance imposed on the same. proper where there is no genuine issue as to the existence of a
There is therefore no question as to ownership. The question is material fact, and the facts appear undisputed based on the
whether or not an easement exists on the property, and as we pleadings, depositions, admissions, and affidavits of record. 18 In
indicated, we are convinced that an easement exists. one case, this Court upheld a decision of the trial court rendered
It is true that the sale did include the alley. On this score, the Court by summary judgment on a claim for money to which the
rejects the petitioner's contention that the deed of sale "excluded" defendant interposed the defense of payment but which failed to
it, because as a mere right-of-way, it cannot be separated from the produce receipts. 19 We held that under the circumstances, the
tenement and maintain an independent existence. Thus: defense was not genuine but rather, sham, and which justified a
Art. 617. Easements are inseparable from the estate to which they summary judgment. In another case, we rejected the claim of
actively or passively belong. 9 acquisitive prescription over registered property and found it
likewise to be sham, and sustained consequently, a summary easement, subject of the controversy in this case, although as a
judgment rendered because the title challenged was covered by a petition for "cancellation of annotation" it may have, at a glance,
Torrens Certificate and under the law, Torrens titles are suggested a different cause of action.
imprescriptible. 20 And for reasons of fair play, the private respondent cannot validly
We also denied reconveyance in one case and approved a reject CA-G.R. No. 13421 as the law of the case, after all, it was
summary judgment rendered thereon, on the ground that from the the one that initiated the cancellation proceedings with the
records, the plaintiffs were clearly guilty of laches having failed to Regional Trial Court in LRC No. 273 that precipitated that appeal.
act until after twenty-seven years. 21 We likewise allowed In the second place, the proceedings for cancellation of annotation
summary judgment and rejected contentions of economic was in fact meant to preempt the injunction decreed by the lower
hardship as an excuse for avoiding payment under a contract for court in this case. Plainly and simply, the private respondent is
the reason that the contract imposed liability under any and all guilty of forum-shopping, as we have described the term:
conditions. 22 xxx xxx xxx
In the case at bar, the defense of merger is, clearly, not a valid There is forum-shopping whenever, as a result of an adverse
defense, indeed, a sham one, because as we said, merger is not opinion in one forum, a party seeks a favorable opinion (other than
possible, and secondly, the sale unequivocally preserved the by appeal or certiorari) in another. The principle applies not only
existing easement. In other words, the answer does not, in reality, with respect to suits filed in the courts but also in connection with
tender any genuine issue on a material fact and cannot militate litigations commenced in the courts while an administrative
against the petitioner's clear cause of action. proceeding is pending, as in this case, in order to defeat
As this Court has held, summary judgments are meant to rid a administrative processes and in anticipation of an unfavorable
proceeding of the ritual of a trial where, from existing records, 23 administrative ruling and a favorable court ruling. This is specially
the facts have been established, and trial would be futile. so, as in this case, where the court in which the second suit was
What indeed, argues against the posturing of the private brought, has no jurisdiction. 25
respondent and consequently, the challenged holding of the to which contempt is a penalty. 26
respondent Court of Appeals as well is the fact that the Court of As it happened, in its effort to shop for a friendly forum, the private
Appeals itself had rendered judgment, in its CA-G.R. No. 13421, respondent found an unfriendly court and it can not be made to
entitled Solid Manila Corporation v. Ysrael, in which it nullified the profit from its act of malpractice by permitting it to downgrade its
cancellation of the easement annotated at the back of the private finality and deny its applicability as the law of the case.
respondent's certificate of title ordered by Judge Ysrael in LRC As a personal servitude, the right-of-way in question was
Case No. 273. As the petitioner now in fact insists, the Court of established by the will of the owner.
Appeals' judgment, which was affirmed by this Court in its In the interesting case of North Negros Sugar Co., Inc. v. Hidalgo,
Resolution dated December 14, 1988, in G.R. No. 83540, is at 27 this Court, speaking through Justice Claro Recto, declared
least, the law of the case between the parties, as "law of the case" that a personal servitude (also a right of way in that case) is
is known in law, e.g.: established by the mere "act" 28 of the landowner, and is not
xxx xxx xxx "contractual in the nature," 29 and a third party (as the petitioner
"Law of the case" has been defined as the opinion delivered on a herein is a third party) has the personality to claim its benefits. In
former appeal. More specifically, it means that whatever is once his separate opinion, however, Justice Jose Laurel maintained that
irrevocably established as the controlling legal rule of decision a personal or voluntary servitude does require a contract and that
between the same parties in the same case continues to be the "[t]he act of the plaintiff in opening the private way here involved
law of the case, whether correct on general principles or not, so did not constitute an offer .." 30 and "[t]here being no offer, there
long as the facts on which such decision was predicated continue could be no acceptance; hence no contract." 31
to be the facts of the case before the court. (21 C.J.S. 330). The Court sees no need to relive the animated exchanges
It may be stated as a rule of general application that, where the between two legal titans (they would contend even more spiritedly
evidence on a second or succeeding appeal is substantially the in the "larger" world of politics) to whom present scholars perhaps
same as that on the first or preceding appeal, all matters, owe their erudition and who, because of the paths they have taken,
questions, points, or issues adjudicated on the prior appeal are the have shaped history itself; after all, and coming back to the case
law of the case on all subsequent appeals and will not be at bar, it is not disputed that an easement has been constituted,
considered or readjudicated therein. (5 C.J.S. 1267). whereas it was disputed in North Negros' case. Rather, the
In accordance with the general rule stated in Section 1821, where, question is whether it is still existing or whether it has been
after a definite determination, the court has remanded the case for extinguished. As we held, our findings is that it is in existence and
further action below, it will refuse to examine question other than as a consequence, the private respondent cannot bar the public,
those arising subsequently to such determination and remand, or by erecting an obstruction on the alley, from its use.
other than the propriety of the compliance with its mandate; and if WHEREFORE, the petition is GRANTED. The decision of the
the court below has proceeded in substantial conformity to the Court of Appeals is SET ASIDE and the decision of the Regional
directions of the appellate court, its action will not be questioned Trial Court is hereby REINSTATED. The petitioner and its counsel
on a second appeal. are hereby required to SHOW CAUSE why they should not be
As a general rule a decision on a prior appeal of the same case is punished for contempt of court, and also administratively dealt with
held to be the law of the case whether that decision is right or in the case of counsel, for forum shopping.
wrong, the remedy of the party deeming himself aggrieved being IT IS SO ORDERED.
to seek a rehearing." (5 C.J.S. 1276-77). ||| (Solid Manila Corp. v. Bio Hong Trading Co., Inc., G.R. No.
Questions necessarily involved in the decision on a former appeal 90596, [April 8, 1991], 273 PHIL 115-128)
will be regarded as the law of the case on a subsequent appeal,
although the questions are not expressly treated in the opinion of Floro v. Llenado 244 SCRA 713
the court, as the presumption is that all the facts in the case THIRD DIVISION
bearing on the point decided have received due consideration [G.R. No. 75723. June 2, 1995.]
whether all or none of them are mentioned in the opinion. (5 C.J.S. SIMEON FLORO, petitioner, vs. ORLANDO A. LLENADO
1286-87). 24 (Deceased), substituted by his wife WENIFREDA T.
CA-G.R. No. 13421 is the law of the case because clearly, it was LLENADO, in her own behalf as Administratrix of the Estate
brought to determine the rights of the parties regarding the of Orlando A. Llenado and as Legal Guardian of Minors Ma.
Bexina, Avelino and Antonio, all surnamed Llenado, and the outlet to a public highway (Art. 649, par. 1); (2) after payment of
COURT OF APPEALS, respondents. proper indemnity (Art. 649, par. 1); (3) that the isolation was not
SYLLABUS due to acts of the proprietor of the dominant estate (Art. 649, last
1. REMEDIAL LAW; CIVIL PROCEDURE; PETITION TO par.); and, (4) that the right of way claimed is at the point least
REVIEW ON CERTIORARI; ORDINARILY CONFINED TO prejudicial to the servient estate; and insofar as consistent with this
REVIEWING ERRORS OF LAW COMMITTED; EXCEPTIONS. rule, where the distance from the dominant estate to a public
In a petition to review a decision of the Court of Appeals under highway may be the shortest (Art. 650). The burden of proving the
Rule 45 of the Rules of Court, the jurisdiction of the Court is existence of the prerequisites to validly claim a compulsory right of
ordinarily confined to reviewing errors of law committed by the way lies on the owner of the dominant estate.
Court of Appeals, its findings of fact being conclusive on the Court. 4. ID.; ID.; ID.; ID.; ID.; NO ADEQUATE OUTLET TO A PUBLIC
There are, however, exceptional circumstances that would compel HIGHWAY AS A CONDITION; NOT MET IN CASE AT BAR.
the Court to review the findings of fact of the Court of Appeals, Significantly, when Orlando Llenado filed the complaint for legal
summarized in Remalante v. Tibe (G.R. No. 59514, February 25, easement under Articles 649 and 650 of the Civil Code, he focused
1988, 158 SCRA 138, 145) and subsequent cases as follows: (1) his argument on the absence of any road, other than the closed
when the inference made is manifestly mistaken, absurd or road of the Floro Park Subdivision, as his means of ingress and
impossible; (2) when there is a grave abuse of discretion; (3) when egress to and from his property. However, he omitted to state that
the finding is grounded entirely on speculations, surmises or there is a proposed access road through the Ipapo property. There
conjectures; (4) when the judgment of the Court of Appeals is being an existing right of way over the Ipapo property, the first
based on misapprehension of facts; (5) when the findings of fact requirement for a grant of a compulsory easement of right of way
are conflicting; (6) when the Court of Appeals in making its findings over the Floro Park Subdivision has not been met.
went beyond the issues of the case and the same is contrary to 5. ID.; ID.; ID.; ID.; ID.; PRE-PAYMENT OF REQUIRED
the admissions of both appellant and appellee; (7) when the INDEMNITY; DEFINED. In Talisay-Silay Milling Co. v. Court of
findings of the Court of Appeals are contrary to those of the trial First Instance of Negros Occidental, (42 SCRA 584) the Court
court; (8) when the findings of fact are conclusions without citation explained what is meant by payment or prepayment of the required
of specific evidence on which they are based; (9) when the Court indemnity under Article 649 of the Civil Code, as follows: ". . .
of Appeals manifestly overlooked certain relevant facts not Prepayment, as we used the term means the delivery of the proper
disputed by the parties and which, if properly considered, would indemnity required by law for the damage that might be incurred
justify a different conclusion; and, (10) when the finding of fact of by the servient estate in the event the legal easement upon the
the Court of Appeals are premised in the absence of evidence and extent of compensation cannot be reached by the parties involved,
are contradicted by the evidence on record. is not an impediment to the establishment of such easement.
2. CIVIL LAW; PROPERTY; EASEMENT OF RIGHT OF WAY; Precisely, the action of the dominant estate against the servient
ABSENCE OF AGREEMENT AS TO THE CONSIDERATION estate should include a prayer for the fixing of the amount which
DOES NOT CREATE A VALID CONTRACT THEREOF. It is may be due from the former to the latter." In the case at bench, no
not disputed that sometime in February 1983, Floro granted the proof was presented by private respondent Llenado that he
Llenados verbal permission to pass through the Floro Park complied with this requirement. The complaint for easement of
Subdivision in going to and from the MacArthur Highway. Whether right of way filed by him in the lower court did not contain a prayer
such permission, as claimed by Floro, was the month of March for the fixing of the amount that he must pay Floro in the event that
only, without compensation and as a neighborly gesture for the the easement of right of way be constituted. Thus, the existence
purpose merely of enabling the Llenados to install stone of the second requisite has likewise not been established.
monuments (mojones) on their land, or was in relation to the 6. ID.; ID.; ID.; ID.; ID.; ISOLATION WAS NOT DUE TO ACTS OF
easement of right of way granted in their favor, as insisted by the THE PROPRIETOR OF THE DOMINANT ESTATE; NOT
Llenados, the fact remains that no such contract of easement of SATISFIED IN THE CASE AT BAR. There can be no denying
right of way was actually perfected between Floro and Llenado. that the isolation of the Llenado Homes Subdivision is the doing of
Both Orlando and Wenifreda Llenado testified that the conditions its owner/developer/applicant. It appears that the access road
of the easement of right of way were still to be drawn up by Floro's indicated in the Plan of the Emmanuel Homes Subdivision and the
lawyer. Thus, no compensation was agreed upon, and none was Llenado Homes Subdivision for which a right of way over the Ipapo
paid, for the passage through Floro's property during the month of property was procured, was merely for the sake of securing an
March. However, when Wenifreda saw Floro in the evening of April approval of the proposed development plan. There were no proofs
7, 1983 to negotiate for the reopening of Road Lot 5 and Floro laid of actual work having been done to construct a road, even just a
down his conditions for the requested reopening and presumably dirty road, over the right of way that would connect road Lot 3 of
for the requested easement of right of way, Orlando rejected said the Llenado Homes Subdivision to the MacArthur Highway. Private
conditions for being onerous. The use of Road Lots 4 and 5 by the respondents Llenado admitted that the Ipapo riceland was no
Llenados during the month of March was by mere tolerance of longer being cultivated and there was already a fence made of
Floro pending the negotiation of the terms and conditions of the adobe wall constructed on it. Indication are that it has already been
right of way. This is evident from the testimony of Wenifreda that abandoned as a ricefield. There was no reason for private
"they said to us to go on while they are preparing for the papers" respondent's failure to develop the right of way except the
and that "We can use that for a while, while they were making for inconvenience and expenses it would cost him. Hence, the third
the papers." Although such use was in anticipation of a voluntary requisite has not been met.
easement of right of way, no such contract was validly entered into 7. ID.; ID.; ID.; ID.; REAL, NOT A FICTITIOUS OR ARTIFICIAL
by reason of the failure of the parties to agree on its terms and NECESSITY REQUIRED TO JUSTIFY THE IMPOSITION
conditions. Thus, private respondents Llenados cannot claim THEREOF. In order to justify the imposition of the servitude of
entitlement to a right of way through the Floro Park Subdivision on right of way, there must be a real, not a fictitious or artificial
the basis of a voluntary easement. necessity for it. Mere convenience for the dominant estate is not
3. ID.; ID.; ID.; COMPULSORY SERVITUDE OF RIGHT OF WAY; what is required by law as the basis for setting up a compulsory
PRECONDITIONS TO BE ESTABLISHED. To be entitled to a easement. Even in the face of a necessity, if it can be satisfied
compulsory servitude of right of way under the Civil Code, the without imposing the servitude, the same should not be imposed.
preconditions provided under Articles 649 and 650 thereof must This easement can also be established for the benefit of a
be established. These preconditions are: (1) that the dominant tenement with an inadequate outlet, but not when the outlet is
estate is surrounded by other immovables and has no adequate merely inconvenient. Thus, when a person had already
established an easement of this nature in favor of his tenement, Homes does not have any existing road or passage to the
he cannot demand another, even if the first passage has defects MacArthur Highway. However, a proposed access road traversing
which make passage impossible, if those defects can be the idle riceland of Marcial Ipapo has been specifically provided in
eliminated by proper repairs. the subdivision plan of Emmanuel Homes Subdivision which was
8. ID.; ID.; ID.; ID.; IMPOSITION THEREOF, NOT PROPER IN duly approved by the defunct Human Settlement Regulatory
CASE AT BAR. Worthy of mention is the trial court's reason for Commission (now Housing and Land Use Regulatory Board). 6
the denial of the easement of right of way, thus: ". . . While it is true Sometime in February, 1983, the Llenados sought, and were
that the conversion of said salable (sic) Lot 14, Block 6 into a Road granted, permission by the Floros to use Road Lots 4 and 5 of the
Lot has been approved by the Human Settlement Regulatory Floro Park Subdivision as the passageway to and from MacArthur
Commission, such approval, however, does not ipso facto connect Highway. On April 7, 1983, however, Floro barricaded Road
Road Lot 5 and 4 (Exh. C-1) of the Floro Park Subdivision in the Lot 5 with a pile of rocks, wooden posts and adobe stones,
absence of consent and/or approval of the owner of said Floro thereby preventing its use by the Llenados.
Park Subdivision. . . . It should be emphasized that the end of Road Their request for the reopening of Road Lot 5 having been denied,
Lot 3 of Llenado Homes Subdivision facing MacArthur Highway as Orlando Llenado instituted on April 13, 1983, a complaint before
per approved subdivision plan, subject of the proposed the Regional Trial Court (RTC) of Malolos, Bulacan, against
amendment, has been designated/specified as an access road Simeon Floro for Easement of Right of Way with the Prayer of the
directly leading to the MacArthur Highway. It is the shortest route Issuance of a Writ of Preliminary Mandatory Injunction and
and the road alignment is direct and in a straight line perpendicular Damages. The complaint was docketed as the Civil Case No.
to the MacArthur Highway. The disapproval, therefore, of the 6834-M and raffled off to Branch XIX, presided over by Hon. Judge
closure and consequent conversion of both ends of Road Lot 3 Camilio Montesa.
into residential lots, in effect, maintains Road Lot 3 as an access After hearing and ocular inspection, the trial court, in an Order
road of Llenado Homes Subdivision to the main highway. There dated July 15, 1983,7 granted the prayer for the issuance of a writ
appears a semblance of deception if the provision for (the) of preliminary mandatory injunction upon the filing of a bond by
proposed access road in the approved subdivision plan of Llenado in the amount of one hundred thousand pesos
Emmanuel Homes Subdivision, now Llenado Homes Subdivision, (P100,000.00). Floro was ordered:
would not be implemented as it would appear that the same was "1. To open the road by removing the rocks and wooden posts
indicated in the plans merely for purposes of approval of the and/or to remove the barricade on the subject road of the Floro
subdivision but not actually to develop and avail of the same was Park Subdivision and enjoining him and any person or persons
originally intended." It is also worthwhile to observe that on under him from doing or performing any acts which will prevent
November 29, 1985 the then Minister of Public Works and (LLENADO) or his agents or any person acting under
Highways found the construction of the concrete culvert across (LLENADO's) instruction from passing through the subject
Palanas Creek illegal in contemplation of Presidential Decree No. subdivision road to get into and to get out of the aforementioned
296, Letters of Instructions No. 19 and Presidential Decree No. properties of (LLENADO) until further order from this Court."
1067 and ordered private respondent herein to remove or Floro moved for reconsideration but was denied the relief
demolish the same, to be carried out by the Chief Civil Engineer, sought. 8 He then filed with the Court of Appeals a petition for
Bulacan Engineering District, at the expense of private certiorari and prohibition with petition for a writ of preliminary
respondent. Failing to establish the existence of the prerequisites injunction and restraining order, but later on, moved to withdraw
under Articles 649 and 650 of the Civil Code, private respondent his petition. His motion for withdrawal was granted by the appellate
Llenado's bid for a compulsory easement of right of way over Road court in its Resolution dated March 30, 1984 which declared the
Lots 4 and 5 of the Floro Park Subdivision must fail. case closed and terminated. 9
DECISION In the meantime, Orlando Llenado died and was substituted by his
ROMERO, J p: wife Wenifreda T. Llenado as administratrix of his estate and as
The instant petition for review on certiorari presents two (2) issues legal guardian of their four (4) minor children. 10 Trial on the merits
for resolution, namely: of the case which was suspended pending resolution of the
(1) whether or not a valid contract of easement of right of way petition before the Court of Appeals, resumed.
exists when the owner of one estate voluntarily allows the On October 16, 1984, the trial court rendered judgment dismissing
owner of an adjacent estate passage through his property for the case and lifting the writ of preliminary mandatory injunction
a limited time, without compensation; and, previously issued. The dispositive portion of the decision 11 reads:
(2) whether or not an owner/developer of a subdivision can "WHEREFORE, judgment is hereby rendered dismissing the
demand a compulsory easement of right of way over the instant complaint for lack of merit, and the writ of preliminary
existing roads of an adjacent subdivision instead of mandatory injunction issued in favor of the plaintiff is hereby
developing his subdivision's purposed access road as ordered dissolved and/or lifted. On the counterclaim posed by
provided in his duly approved subdivision plan. defendant, the plaintiff is hereby ordered to pay defendant the
following amounts:
Simeon Floro is the owner of a piece of land known as the Floro a. P30,000.00 as actual damages suffered by defendant;
Park Subdivision situated in Barangay Saluysoy, Meycauayan, b. P77,500.00 as a compensation for the use of defendant's
Bulacan. 1 The subdivision has its own egress and ingress to and property;
from the MacArthur Highway by means of its Road Lot 4 and the c. P15,000.00 as attorney's fees and;
PNR level crossing. d. To pay the costs of the suit.
Orlando A. Llenado, 2 on the other hand, was the registered owner SO ORDERED."
of two (2) parcels of land, with the total area of 34, 573 sq. meters,
more or less,3known as the Llenado Homes Subdivision ("Llenado On the appeal by Llenado, the appellate court set aside the
Homes," for brevity). Prior to its purchase by Llenado from the decision of the trial court in a decision 12 promulgated on February
owner Francisco de Castro, the land was known as the Emmanuel 11, 1986, the dispositive portion of which reads as follows:
Homes Subdivision, a duly licensed and registered housing "WHEREFORE, premises considered, the decision appealed from
subdivision in the name of Soledad Ortega. 4 Bounded on the is hereby SET ASIDE and another one entered:
South by the 5 to 6 meter-wide Palanas Creek, 5 which separates (1) Granting the establishment of a legal or compulsory easement
it from the Floro Park Subdivision, and on the west by ricelands of right of way passing through Road Lots 4 and 5 of defendant's
belonging to Marcial Ipapo, Montaos and Guevarra, the Llenado
Floro Park Subdivision in favor of plaintiff's Llenado Homes The findings and conclusions of the Court of Appeals, being
Subdivision; contrary to the findings and conclusions of the trial court, the
(2) Ordering defendant to remove immediately all of the instant case falls within the exception. Thus, the Court may
obstructions, such as walls, rocks and posts with which he had scrutinize the evidence on the record to bring to light the real facts
barricaded Road Lot 5 for the purpose of preventing plaintiff from of the case. 20
using defendant's subdivision as passage way to the MacArthur
Highway; It is not disputed that sometime in February 1983, Floro granted
(3) Ordering defendant to pay to plaintiff, upon finality of this the Llenados verbal permission to pass through the Floro Park
decision, the following: Subdivision in going to and from the MacArthur Highway. Whether
(a) P60,000.00 temperate or moderate damages such permission, as claimed by Floro, was the month of March
(b) P100,000.00 moral damages; and only, without compensation and as a neighborly gesture for the
(c) P30,000.00 attorney's fees; purpose merely of enabling the Llenados to install stone
(4) Ordering plaintiff to pay to defendant the amount of P60,000.00 monuments (mojones) on their land, 21 or was in relation to the
within ten (10) days from the date of finality of this decision as easement of right of way granted in their favor, as insisted by the
indemnity for the right of way pursuant to the mandate of Article Llenados, 22 the fact remains that no such contract of easement
649 of the Civil Code; and of right of way was actually perfected between Floro and
(5) Ordering defendant to pay the costs. Llenado. Both Orlando 23 and Wenifreda Llenado 24 testified the
The liability of the defendant under No. (3) (supra) shall be legally conditions of the easement of right of way were still to be drawn
compensated by the liability of the plaintiff under No. (4) (supra) up by Floro's lawyer. Thus, no compensation was agreed upon,
automatically to the extent that the amount of one is covered by and none was paid, for the passage through Floro's property
the amount of the other. during the month of March. 25
SO ORDERED."
On August 14, 1986, the appellate court in separate resolutions However, when Wenifreda saw Floro in the evening of April 7,
denied Floro's motion for reconsideration and supplementary 1983 to negotiate for the reopening of Road Lot 5 and Floro laid
motion 13 and granted Llenado's motion for partial execution down his conditions 26for the requested reopening and
pending appeal. 14 The latter resolution provided in its dispositive presumably for the requested easement of right of way, Orlando
portion, thus: rejected said conditions for being onerous. 27
"WHEREFORE, upon the posting by plaintiff appellant of a bond In Dionisio v. Ortiz, 28 where therein private respondents claimed
in the amount of ONE HUNDRED THOUSAND PESOS to have every right to use Howmart Road as passageway to EDSA
(P100,000.00) approved by this Court, let a writ of partial execution by reason of a standing oral contract of easement of right of way
pending appeal be issued ordering the defendant-appellee to with therein petitioner, so that the latter did not have the right to
remove immediately all of the obstructions, including all walls, put a barricade in front of private respondent's gate and to stop
rocks, posts, and other materials with which he has barricaded them from using said gate as a passageway to Howmart Road, the
Road Lot 5, for the purpose of preventing plaintiff-appellant from Court said:
using defendant's subdivision as passage way to the MacArthur "There is no question that a right of way was granted in favor of
Highway. Said Order shall include Road Lot 4 so that plaintiff- the private respondents over Howmart Road but the records
appellant will have free access to MacArthur Highway. disclose that such right of way expired in December 1988. The
SO ORDERED." continued use of the easement enjoyed by QCIEA including the
The writ of partial execution pending appeal was issued on private respondents is by the mere tolerance of the owner pending
October 2, 1986 after the instant Petition had been filed and after the renegotiation of the terms and conditions of said right of way.
the Court had resolved on September 15, 1986 to require Llenado . . . Absent an agreement of the parties as to the consideration,
to comment thereon. On motion of Floro, the Court issued a among others, no contract of easement of right of way has been
restraining order on October 29, 1986, 15 enjoining the appellate validly entered into by the petitioners and QCIEA. Thus the private
court from carrying out its writ of partial execution pending appeal. respondent's claim of an easement of right of way over Howmart
Subsequently, the instant petition was given due course. 16 Road has no legal or factual basis."
In a petition to review a decision of the Court of Appeals
under Rule 45 of the Rules of Court, the jurisdiction of the Court is As in the Dionisio case, the use of Road Lots 4 and 5 by the
ordinarily confined to reviewing errors of law committed by the Llenados during the month of March was by mere tolerance of
court of Appeals, its findings of fact being conclusive on the Floro pending the negotiation of the terms and conditions of the
Court. 17 There are, however, exceptional circumstances that right of way. This is evident from the testimony of Wenifreda that
would compel the Court to review the findings of fact of the Court "they said to us to go on while they are preparing for the papers"
of Appeals, summarized in Remalante v. Tibe 18 and subsequent and that "We can use that for a while, while they were making for
cases 19 as follows: (1) when the inference made is manifestly the papers." 29 Although such use was in anticipation of a
mistaken, absurd or impossible; (2) when there is a grave abuse voluntary easement of right of way, no such contract was validly
of discretion; (3) when the finding is grounded entirely on entered into by reason of the failure of the parties to agree on its
speculations, surmises or conjectures; (4) when the judgment of terms and conditions. Thus, private respondents Llenados
the Court of Appeals is based on misapprehension of facts; (5) cannot claim entitlement to a right of way through the Floro
when the findings of fact are conflicting; (6) when the Court of Park Subdivision on the basis of a voluntary easement.
Appeals in making its findings went beyond the issues of the case
and the same is contrary to the admissions of both appellant and Having ruled that no voluntary easement of right of way had been
appellee; (7) when the findings of the Court of Appeals are established in favor of private respondents Llenados, we now
contrary to those of the trial court; (8) when the findings of fact are determine whether or not they are entitled to a compulsory
conclusions without citation of a specific evidence on which they easement of right of way.
are based; (9) when the Court of Appeals manifestly overlooked For the Llenados to be entitled to a compulsory servitude of right
certain relevant facts not disputed by the parties and which, if of way under the Civil Code, the preconditions provided
properly considered, would justify a different conclusion; and, (10) under Articles 649 and 650 thereof must be established. These
when the finding of fact of the Court of Appeals are premised on preconditions are: (1) that the dominant estate is surrounded by
the absence of evidence and are contradicted by the evidence on other immovables and has no adequate outlet to a public highway
record. (Art. 649, par. 1); (2) after payment of proper indemnity (Art. 649,
par. 1); (3) that the isolation was not due to acts of the proprietor approval, the subdivision must have an access road. It was not
of the dominant estate (Art. 649, last par.); and, (4) that the right necessary that the access road be a paved road. A dirt road was
of way claimed is at the point least prejudicial to the servient sufficient provided that the owner of the lot used as access road
estate; and insofar as consistent with this rule, where the distance gives his consent and the owner/developer/applicant of the
from the dominant estate to a public highway may be the shortest proposed subdivision develops the proposed access road, 44 as
(Art. 650). 30 approved by the HSRC in compliance with Section 29
The burden of providing the existence of the prerequisites to of Presidential Decree No. 957 which states:
validly claim a compulsory right of way lies on the owner of the "SEC. 29 Right of Way to Public Road The owner or developer
dominant estate. 31 We find that private respondents have failed of a subdivision without access to any existing public road or street
in this regard. must secure a right of way to a public road or street and such right
Significantly, when Orlando Llenado filed the complaint for legal of way must be developed and maintained according to the
easement under Articles 649 and 650 of the Civil Code, he focused requirement of the government authorities concerned."
his argument on the absence of any road, other than the closed On appeal to the Court of Appeals, private respondents Llenado
road of the Floro Park Subdivision, as his means of ingress and submitted a letter of Marcial Ipapo dated July 3, 1985 addressed
egress to and from his property. However, he omitted to state that to the HSRC, 45informing the latter that he did not give a road right
there is a proposed access road through the Ipapo property. of way over his property in favor of Soledad Ortega, the developer
of Emmanuel Homes Subdivision. This letter seems to be an
Danilo Ravello, an engineer employed as Project Officer of the aftermath of the testimony of Engr. Ravello that the notarized
Human Settlement Regulatory Commission (HSRC) since 1981, affidavit of Ipapo submitted by Soledad Ortega to the HSRC could
testified that his duties consisted in evaluating and processing not be located in the records of the Commission. 46 This new
subdivision plans and making the proper recommendation for their matter, however, is inadmissible in evidence, not having been
approval or disapproval. The application of Soledad Ortega for the authenticated in accordance with Section 20, Rule 132 of the
Emmanuel Homes Subdivision, 32 appearing on page 120 of the Rules of the Court. It was, therefore, erroneous on the part of the
records of the HSRC, had the following attachments: (1) Sketch Court of Appeals to consider this piece of evidence in its
Plan of the property containing an area of 34,973 sq. m.; 33 (2) Resolution For the Motion For Reconsideration dated August 124,
Waterline Layout Plan; 34 (3) Vicinity Plan; 35 (4) Road Plan 1986. 47
Layout; 36 and (5) Consolidation Subdivision Plan. 37 According There being an existing right of way over the Ipapo property,
to Ravello, as per Plan Exhs. "10-A" and "10-C", Road Lot 3 of the the first requirement for a grant of a compulsory easement of
Emmanuel Homes Subdivision starts and ends with adjacent right of way over the Floro Park Subdivision has not been met.
properties; on one end, the property owned by Mariano Monadero
and at the other, the property owned by a certain Ventura Tan In Talisay-Silay Milling Co. v. Court of First Instance of Negros
Mariano. As per Plans, the access road to the subdivision should Occidental, 48 the Court explained what is meant by payment or
have come from the MacArthur Highway through the Ipapo prepayment of the required indemnity under Article 649 of the Civil
property. 38 Having found on ocular inspection that the access Code, as follows:
road indicated in the Plan did not actually exist, the HSRC required ". . . Prepayment, as we used the term means the delivery of the
applicant Soledad Ortega to submit a written right of way proper indemnity required by law for the damage that might be
clearance from Ipapo, which she did and on the basis of which, her incurred by the servient estate in the event the legal easement is
application on behalf of the Emmanuel Homes Subdivision was constituted. The fact that a voluntary agreement upon the extent
approved. 39 of compensation cannot be reached by the parties involved, is not
When Orlando Llenado acquired the subject property, he adopted an impediment to the establishment of such easement. Precisely,
the subdivision plans of Emmanuel Homes and renamed it as the the action of the dominant estate against the servient estate
Llenado Homes Subdivision. Accordingly, he applied for the should include a prayer for the fixing of the amount which may be
issuance of a new Development Permit and License to Sell in his due from the former to the latter."
name as the new owner of the subdivision. Subsequently, the In the case at bench, no proof was presented by private
corresponding license to sell and development permit were issued. respondent Llenado that he complied with this requirement. The
As shown by the Consolidation Subdivision Plan 40 submitted by complaint for easement of right of way filed by him in the
Orlando Llenado, the names Soledad Ortega/Emmanuel Homes lower court did not contain a prayer for the fixing of the
Subdivision were merely crossed out and, in lieu thereof, the amount that he must pay Floro in the event that the easement
names Orlando Llenado/Llenado Homes Subdivision were written. of right of way be constituted. Thus, the existence of the
In said subdivision plan which was duly approved by the HSRC, second requisite has likewise not been established.
the Ipapo Access Road was retained.
On July 1, 1983, during the pendency of Civil Case No. 6834-M, There can be no denying that the isolation of the Llenado
Orlando Llenado filed with the HSRC an application for the Homes Subdivision is the doing of its
amendment of the original Consolidation Subdivision Plan of the owner/developer/applicant. It appears that the access road
Llenado Homes Subdivision. 41 The proposed amendments, as indicated in the Plan of the Emmanuel Homes Subdivision and the
indicated in Exh. "11-A", 42 were: (1) the conversion of Lot 14 of Llenado Homes Subdivision for which a right of way over the Ipapo
Block 6 into a road lot, designed to connect with Road Lot 5 of the property was procured, was merely for the sake of securing an
Floro Homes Subdivision; and, (2) the closing of both ends of approval of the proposed development plan. There were no proofs
Road Lot 3, the portion leading to the Ventura Tan Mariano of actual work having been done to construct a road, even just a
property and the portion leading to the Ipapo right of way (Adriano dirty road, over the right of way that would connect road Lot 3 of
Monadero property), to be converted into saleable residential lots. the Llenado Homes Subdivision to the MacArthur Highway. Private
The first proposed alteration, the conversion of Lot 14, Block 6 into respondent llenado admitted that the Ipapo riceland was no longer
a road lot was approved on March 20, 1984. 43 The access road being cultivated and there was already a fence made of adobe wall
of Llenado Homes Subdivision, however, remained in the constructed on it. 49 Indication are that it has already been
Subdivision Plan to be through the Ipapo property, as approved by abandoned as a ricefield. There was no reason for private
the HSRC. respondent's failure to develop the right of way except the
When asked by the court as to the policy of the HSRC regarding inconvenience and expenses it would cost him. Hence, the third
the approval of a subdivision plan in connection with the right of requisite has not been met.
way issue, Engr. Ravello responded that as a prerequisite for
If the servitude requested by private respondent Llenado is Subdivision facing MacArthur Highway as per approved
allowed, other subdivision developers/owners would be subdivision plan, subject of the proposed amendment, has been
encouraged to hastily prepare a subdivision plan with fictitious designated/specified as an access road directly leading to the
provisions for access roads merely for registration purposes. MacArthur Highway. It is the shortest route and the road alignment
Thereafter, said developers could abandon their duly approved is direct and in a straight line perpendicular to the MacArthur
plans and, for whatever reason, open up another way through Highway. The disapproval, therefore, of the closure and
another property under the pretext that they have inadequate consequent conversion of both ends of Road Lot 3 into residential
outlets to a public road or highway. Furthermore, if such practice lots, in effect, maintains Road Lot 3 as an access road of Llenado
were tolerated, the very purpose for which Presidential Decree No. Homes Subdivision to the main highway. There appears a
957 was enacted, that is to protect subdivision buyers from semblance of deception if the provision for (the) proposed access
unscrupulous subdivision owners/developers who renege on their road in the approved subdivision plan of Emmanuel Homes
duties to develop their subdivisions in accordance with the duly Subdivision, now Llenado Homes Subdivision, would not be
approved subdivision plans, would be defeated. implemented as it would appear that the same was indicated in the
The Court takes cognizance of the fact that, instead of developing plans merely for purposes of approval of the subdivision but not
the proposed access road, private respondent Llenado applied for actually to develop and avail of the same was originally intended."
the conversion of Lot 14 of Block 6 into a road lot to connect it with It is also worthwhile to observe that on November 29, 1985 the
Road Lot 5 of the Floro Park Subdivision, citing as reason therefor, then Minister of Public Works and Highways found the
that the amendment sought would create a "more adequate and construction of the concrete culvert across Palanas Creek illegal
practical passage" from Llenado Homes Subdivision to the in contemplation of Presidential Decree No. 296, Letters of
MacArthur National Highway and vise-versa. The "convenience" Instructions No. 19 and Presidential Decree No. 1067 and ordered
of using Road Lots 4 and 5 of the Floro Park Subdivision will private respondent herein to remove or demolish the same, to be
not suffice, however, to justify the easement in favor of carried out by the Chief Civil Engineer, Bulacan Engineering
private respondent. District, at the expense of private respondent. 56
In order to justify the imposition of the servitude of right of Failing to establish the existence of the prerequisites under
way, there must be a real, not a fictitious or artificial necessity Articles 649 and 650 of the Civil Code, private respondent
for it. Mere convenience for the dominant estate is not what Llenado's bid for a compulsory easement of right of way over Road
is required by law as the basis for setting up a compulsory Lots 4 and 5 of the Floro Park Subdivision must fail.
easement. Even in the face of a necessity, if it can be satisfied It appears from the records that during the period from March 1983
without imposing the servitude, the same should not be until the closure of the subject roads on April 7, 1983, private
imposed. 50 This easement can also be established for the respondent was allowed to pass thru petitioner's subdivision
benefit of a tenement with an inadequate outlet, but not when the without any agreement or compensation. During the same period,
outlet is merely inconvenient. Thus, when a person has already the subject roads (Road Lots 4 and 5) were damaged due to trucks
established an easement of this nature in favor of his tenement, and heavy equipment passing thereon. Justice and equity demand
he cannot demand another, even if those first passage has defects that petitioner be compensated for the said damage. Hence, the
which make passage impossible, if those defects can be lower court's decision awarding to petitioner Thirty Thousand
eliminated by proper repairs. 51 Pesos (P30,000.00) as actual and compensatory damages should
In the case of Ramos v. Gatchalian, 52 the Court denied access be affirmed.
to Sucat Road through Gatchalian Avenue in view of the fact that Petitioner should likewise be indemnified for the use of his property
petitioner had a road right of way provided by the Sobrina from July 15, 1983 (upon the reopening of the subject road
Rodriguez Lombos Subdivision indicated as Lot 4133-G-12 in its pursuant to the issuance of a writ of preliminary mandatory
subdivision plan for the buyers of its lots, notwithstanding that said injunction) until October 16, 1986 (when the writ was lifted). In the
lot was still undeveloped and inconvenient to petitioner. Even if absence of a specific provision applicable in the case at bench as
Ramos, the petitioner therein, had "to pass through other lots to the amount of proper indemnity, the award of Sixty Thousand
belonging to other owners, which are grassy and cogonal, as Pesos (P60,000.00) as temperate or moderate damages pursuant
temporary ingress/egress with great inconvenience particularly to Articles 2224 and 2225 of the Civil Code 57 is considered
due to flood and mud," the Court did not allow the easement proper and reasonable. 58
because it would run counter to existing jurisprudence that mere As regards the claim for attorney's fees, considering that the
convenience for the dominant estate does not suffice to serve as petitioner was compelled to file a petition for review on certiorari
basis for the servitude. This ruling was reiterated in Rivera v. before this Court, the amount of Thirty Thousand Pesos
Intermediate Appellate Court 53 and Constabella Corporation v. (P30,000.00) is just reasonable. Cdpr
Court of Appeals. 54 WHEREFORE, the appealed decision of the Court of Appeals is
As borne out by the records of this case, despite the closure of the SET ASIDE and the decision of the trial court, as herein modified,
subject road, construction work at Llenado Homes Subdivision is REINSTATED. Costs against private respondent.
continued. The alternative route taken by private respondent is SO ORDERED.
admittedly inconvenient because he has to transverse several ||| (Floro v. Llenado, G.R. No. 75723, [June 2, 1995], 314 PHIL
ricelands and rice paddies belonging to different persons, not to 715-741)
mention that said passage, as found by the trial court, is
impassable during the rainy season. However, private respondent Quimen v. Court of Appeals 257 SCRA 163
has no one to blame but himself for not developing the proposed FIRST DIVISION
access road through the Ipapo property. [G.R. No. 112331. May 29, 1996.]
Worthy of mention is the trial court's reason 55 for the denial of the ANASTACIA QUIMEN, petitioner, vs. COURT OF APPEALS an
easement of right of way, thus: d YOLANDA Q. OLIVEROS, respondents.
". . . While it is true that the conversion of said salable (sic) Lot 14, Benedicto L. Nanca for petitioner.
Block 6 into a Road Lot has been approved by the Human Armando A. San Antonio for private respondent.
Settlement Regulatory Commission, such approval, however, SYLLABUS
does not ipso facto connect Road Lot 5 and 4 (Exh. C-1) of the 1. REMEDIAL LAW; EVIDENCE;
Floro Park Subdivision in the absence of consent and/or approval FINDINGS OF FACT OF THE COURT OF APPEALS REVERSI
of the owner of said Floro Park Subdivision. . . . It should be NG THE DECISION OF THE TRIAL COURT, UPHELD ON
emphasized that the end of Road Lot 3 of Llenado Homes APPEAL. But we find no cogent reason to disturb the
ruling of respondent appellate court granting a right of way to that respondent court erroneously concluded that the right of way
private respondent through petitioner's property. In fact, as proposed by private respondent is the least onerous to the parties.
between petitioner Anastacia and respondent Yolanda their We cannot agree. Article 650 of the New Civil Code explicitly
agreement has already been rendered moot insofar as it concerns states that the easement of right of way shall be established at the
the determination ofthe principal issue herein presented. The point least prejudicial to the servient estate and, insofar as
voluntary easement in favor of private respondent, which consistent with this rule, where the distance from the dominant
petitioner now denies but which the court is inclined to believe, has estate to a public highway may be the shortest. The
in fact become a legal easement or an easement by necessity criterion of least prejudice to the servient estate must prevail over
constituted by law. The trial court found that Yolanda's property the criterion of shortest distance although this is a
was situated at the back of her father's property and held that there matter of judicial appreciation. While shortest distance may
existed an available space of about nineteen (19) meters long ordinarily imply least prejudice, it is not always so as when there
which could conveniently serve as a right ofway between the are permanent structures obstructing the shortest distance; while
boundary line and the house of Yolanda's father; that the vacant on the other hand, the longest distance may be free of
space ended at the left back of Sotero's store which was obstructions and the easiest or most convenient to pass through.
made of strong materials; that this explained why Yolanda In other words, where the easement may be established on
requested a detour to the lot of Anastacia and cut an any of several tenements surrounding the dominant estate, the
opening of one (1) meter wide and five (5) meters long to serve as one where the way is shortest and will cause the least
her right of way to the public highway. But notwithstanding its damage should be chosen. However, as elsewhere stated, if these
factual observations, the trial court concluded, although two (2) circumstances do not concur in a single tenement, the way
erroneously, that Yolanda was not entitled to a right of way on which will cause the least damage should be used, even if it will
petitioner's property since a detour through it would not make the not be the shortest.
line straight and would not be the route shortest to the public DECISION
highway. In applying Art. 650 of the New Civil Code, BELLOSILLO, J p:
respondent Court of Appeals declared that the proposed IN EASEMENT OF RIGHT OF WAY that easement where the
right of way of Yolanda, which is one (1) meter wide and five (5) way is shortest and will cause least prejudice shall be chosen.
meters long at the extreme right of petitioner's property, will cause However, if the two circumstances do not concur in a single
the least prejudice and/or damage as compared to the suggested tenement, the way where damage will be least shall be used even
passage through the property of Yolanda' s father which would if not the shortest route. 1 This is so because least
mean destroying the sari-sari store made of strong materials. prejudice prevails over shortest distance. This means that
Absent any showing that these findings and conclusion are the court is not bound to establish what is the shortest distance; a
devoid of factual support in the records, or are so glaringly longer way may be adopted to avoid injury to the servient estate,
erroneous, this Court accepts and adopts them. As between a such as when there are constructions or walls which can be
right ofway that would demolish a store of strong materials to avoided by a round about way, or to secure the interest of the
provide egress to a public highway, and another right of way which dominant owner, such as when the shortest distance would place
although longer will only require an avocado tree to be cut down, the way on a dangerous decline.
the second alternative should be preferred. After all, it is not the FACTS:
main function of this Court to analyze or weigh the evidence Petitioner Anastacia Quimen together with her brothers Sotero,
presented all over again where the petition would necessarily Sulpicio, Antonio and sister Rufina inherited a piece of property
invite calibration of the whole evidence considering primarily the situated in Pandi, Bulacan. They agreed to subdivide the property
credibility of witnesses, existence and relevancy of specific equally among themselves, as they did, with the
surrounding circumstances, their relation to each other, and the shares of Anastacia, Sotero, Sulpicio and Rufina abutting the
probabilities of the situation. In sum, this Court finds that the municipal road. The share of Anastacia, located at the extreme
decision of respondent appellate court is thoroughly backed up by left, was designated as Lot No. 1448-B-1. It is bounded on the right
law and the evidence. by the property of Sotero designated as Lot No. 1448-B-2.
2. CIVIL LAW; PROPERTY, OWNERSHIP AND ITS Adjoining Sotero's property on the right are Lots Nos. 1448-B-3
MODIFICATIONS; EASEMENT, DEFINED. As defined, an and 1448-B-4 originally owned by Rufina and Sulpicio,
easement is a real right on another's property, corporeal and respectively, but which were later acquired by a certain Catalina
immovable, whereby the owner of the latter must refrain from Santos. Located directly behind the lots of Anastacia and Sotero
doing or allowing somebody else to do or something to be done is the share of their brother Antonio designated as Lot No. 1448-
on his property, for the benefit of another person or tenement. It B-C which the latter divided into two (2) equal parts, now Lots Nos.
is jus in re aliena, inseparable, indivisible and perpetual, unless 1448-B-6-A and 1448-B-6-B, each with an area of 92 square
extinguished by causes provided by law. A right of way in meters. Lot No. 1448-B-6-A is located behind Anastacia's Lot No.
particular is a privilege constituted by covenant or granted by law 1448-B-1, while Lot No. 1448-B-6-B is behind the property of
to a person or class of persons to pass over another's property Sotero, father of respondent Yolanda.
when his tenement is surrounded by realties belonging to others In February 1982 Yolanda purchased Lot No. 1448-B-6-A from her
without an adequate outlet to the public highway. The owner of the uncle Antonio through her aunt Anastacia who was then acting as
dominant estate can demand a right of way through the servient his administratrix. According to Yolanda, when petitioner offered
estate provided he indemnifies the owner thereof for the beneficial her the property for sale she was hesitant to buy as it had no
use of his property. access to a public road. But Anastacia prevailed upon her to buy
3. ID.; ID.; EASEMENTS; RIGHT OF WAY; CONDITIONS FOR the lot with the assurance that she would give her a right of way
GRANT THEREOF. The conditions sine qua non for a valid on her adjoining property for P200.00 per square meter.
grant of an easement of right of way are: (a) the dominant estate Thereafter, Yolanda constructed a house on the lot she bought
is surrounded by other immovables without an adequate outlet to using as her passageway to the public highway a
a public highway; (b) the dominant estate is willing to pay the portion of Anastacia's property. But when Yolanda finally offered
proper indemnity; (c) the isolation was not due to the acts of the to pay for the use of the pathway Anastacia refused to accept the
dominant estate; and, (d) the right of way being claimed is at a payment. In fact she was thereafter barred by Anastacia from
point least prejudicial to the servient estate. passing through her property. 2
4. ID.; ID.; ID.; ID.; CRITERION OF LEAST PREJUDICE TO THE
SERVIENT ESTATE, CONSTRUED. Petitioner finally insists
In February 1986 Yolanda purchased the other span of seventy (70) years, she expects a substantial earning from
lot of Antonio Quimen, Lot No. 1448-B-6-B, located directly behind it. 7
the property of her parents who provided her a pathway gratis et But we find no cogent reason to disturb the ruling of respondent
amore between their house, extending about nineteen (19) meters appellate court granting a right of way to private respondent
from the lot of Yolanda behind the sari sari store of Sotero, and through petitioner's property. In fact, as between petitioner
Anastacia's perimeter fence. The store is made of strong materials Anastacia and respondent Yolanda their agreement has already
and occupies the entire frontage of the lot measuring four (4) been rendered moot insofar as it concerns the determination of the
meters wide and nine meters (9) long. Although the pathway leads principal issue herein presented. The voluntary easement in
to the municipal road it is not adequate for ingress and egress. The favor of private respondent, which petitioner now denies but which
municipal road cannot be reached with facility because the store the court is inclined to believe, has in fact become a legal
itself obstructs the path so that one has to pass through the back easement or an easement by necessity constituted by law. 8
entrance and the facade of the store to reach the road. As defined, an easement is a real right on another's property,
On 29 December 1987 Yolanda filed an action with the corporeal and immovable, whereby the owner of the latter must
proper court praying for a right of way through Anastacia's refrain from doing or allowing somebody else to do or something
property. An ocular inspection upon instruction of the presiding to be done on his property, for the benefit of another person or
judge was conducted by the branch clerk of court. The report was tenement. 9 It is jus in re aliena, inseparable, indivisible and
that the proposed right of way was at the extreme perpetual, unless extinguished by causes provided by law. A
right of Anastacia's property facing the public highway, starting right of way in particular is a privilege constituted by covenant or
from the back of Sotero's sari sari store and extending inward by granted by law 10 to a person or class of persons to pass over
one (1) meter to her property and turning left for about five (5) another's property when his tenement is surrounded by realties
meters to avoid the store of Sotero in order to reach the municipal belonging to others without an adequate outlet to the public
road 3 and the way was unobstructed except for an avocado tree highway. The owner of the dominant estate can demand a
standing in the middle. 4 right of way through the servient estate provided he indemnifies
But on 5 September 1991 the trial court dismissed the complaint the owner thereof for the beneficial use of his property. 11
for lack of cause of action, explaining that the right of way through
Sotero's property was a straight path and to allow a detour by The conditions sine qua non for a valid grant of an
cutting through Anastacia's property would no longer make the easement of right of way are: (a) the dominant estate is
path straight. Hence the trial court concluded that it was more surrounded by other immovables without an adequate outlet to a
practical to extend the existing pathway to the public road by public highway; (b) the dominant estate is willing to pay the proper
removing that portion of the store blocking the path as that was the indemnity; (c) the isolation was not due to the acts of the dominant
shortest route to the public road and the least prejudicial to the estate; and, (d) the right of way being claimed is at a point least
parties concerned than passing through Anastacia's property. 5 prejudicial to the servient estate. 12
A cursory examination of the complaint of respondent Yolanda for
On appeal by respondent Yolanda, the Court of Appeals reversed a right of way 13 readily shows that
the lower court and held that she was entitled to a right of way on [E]ven before the purchase of the said parcels of land the plaintiff
petitioner's property and that the way proposed by Yolanda would was reluctant to purchase the same for they are enclosed with
cause the least damage and detriment to the servient permanent improvements like a concrete fence and store and
estate. 6 The appellate court however did not award damages to have (sic) no egress leading to the road but because of the
private respondent as petitioner did not act in bad faith in resisting assurance of the defendant that plaintiff will be provided one (1)
the claim. meter wide and five (5) meters long right of way in the
sum of P200.00 per square meter to be taken from Anastacia's lot
Petitioner now comes to us imputing ERROR to at the side of a concrete store until plaintiff reach(es) her father's
respondent Court of Appeals: (a) in disregarding the land, plaintiff was induced to buy the aforesaid parcels of land . . .
agreement of the parties; (b) in considering petitioner's property as That the aforesaid right of way is the shortest, most convenient
a servient estate despite the fact that it does not abut or adjoin the and the least onerous leading to the road and being used by the
property of private respondent; and, (c) in holding that the one- plaintiff's predecessors-in-interest from the very inception . . . .
meter by five-meter passage way proposed by private respondent The evidence clearly shows that the property of private
is the least prejudicial and the shortest distance to the public road. respondent is hemmed in by the estates of other persons including
Incidentally, petitioner denies having promised private respondent that of petitioner; that she offered to pay P200.00 per square meter
a right of way. She claims that her agreement with private for her right of way as agreed between her and petitioner; that she
respondent was to provide the latter with a right of way on the did not cause the isolation of her property; that the right of way is
other lot of Antonio Quimen under her administration when it was the least prejudicial to the servient estate. 14 These facts are
not yet sold to private respondent. Petitioner insists that passing confirmed in the ocular inspection report of the clerk of court, more
through the property of Yolanda's parents is more accessible to so that the trial court itself declared that "[t]he said
the public road than to make a detour to her property and cut down properties of Antonio Quimen which were purchased by plaintiff
the avocado tree standing thereon. Yolanda Quimen Oliveros were totally isolated from the public
Petitioner further argues that when Yolanda purchased Lot No. highway and there appears an imperative need for an
1448-B-6-B in 1986 the easement of right of way she provided her easement of right of way to the public highway." 15
(petitioner) was ipso jure extinguished as a result of the
merger of ownership of the dominant and the servient estates in Petitioner finally insists that respondent court erroneously
one person so that there was no longer any compelling reason to concluded that the right of way proposed by private respondent is
provide private respondent with a right of way as there are other the least onerous to the parties. We cannot agree. Article
surrounding lots suitable for the purpose. Petitioner strongly 650 of the New Civil Code explicitly states that the
maintains that the proposed right of way is not the shortest access easement of right of way shall be established at the point least
to the public road because of the detour and that, moreover, she prejudicial to the servient estate and, insofar as consistent with this
is likely to suffer the most damage as she derives a net rule, where the distance from the dominant estate to a public
income of P600.00 per year from the sale of the fruits of her highway may be the shortest. The criterion of least prejudice to
avocado tree, and considering that an avocado has an average life the servient estate must prevail over the criterion of shortest
distance although this is a matter of judicial appreciation.
While shortest distance may ordinarily imply least prejudice, it is considering primarily the credibility of witnesses, existence and
not always so as when there are permanent structures obstructing relevancy of specific surrounding circumstances, their relation to
the shortest distance; while on the other hand, the longest each other, and the probabilities of the situation. 18 In sum,
distance may be free of obstructions and the easiest or most this Court finds that the decision of respondent appellate court is
convenient to pass through. In other words, where the easement thoroughly backed up by law and the evidence.
may be established on any of several tenements surrounding the
dominant estate, the one where the way is shortest and will cause WHEREFORE, no reversible error having been committed by
the least damage should be chosen. However, as elsewhere respondent Court of Appeals, the petition is DENIED and the
stated, if these two (2) circumstances do not concur in a single decision subject of review is AFFIRMED. Costs against petitioner.
tenement, the way which will cause the least damage should be SO ORDERED.
used, even if it will not be the shortest. 16 This is the test. ||| (Quimen v. Court of Appeals, G.R. No. 112331, [May 29, 1996],
326 PHIL 969-981)
In the trial court, petitioner openly admitted
Q. You testified during your direct examination about this plan, De Jesus, et al. v. Howmart Corp., et al. 12 CA Rep. 831
kindly go over this and please point to us in what portion of this DE JESUS ET AL VS HOWMART ET AL 12 CA REP 83
plan is the house or store of the father of the (plaintiff)? FACTS:
A. This one, sir (witness pointed a certain portion located near the Jesus and Luz Miranda de Jesus are owners of the building
proposed right of way). located in Tondo, Manila. They brought an action for damages
xxx xxx xxx against Homart Corporation and Howmill Manufacturing
Q. Now, you will agree with me . . . that this portion is the front Corporation, owners of the land adjoining the plaintiff on the same
portion of the lot owned by the father of the plaintiff and which was street where a sixty storey concrete building was constructed.
(sic) occupied by a store made up of strong materials? Plaintiffs allege that the defendants failed to observe the
A. It is not true, sir. necessary care and precautions to protect the construction of the
Q. What materials does (sic) this store of the father of the plaintiff plaintiffs by depriving it of sufficient lateral or subjacent support,
made of? thereby causing it to sink in some parts; its walls, ceilings, and
A. Hollow blocks and the side is made of wood, sir. floorings to crack in some places; and by the careless manner of
xxx xxx xxx handling the cement used the roofings of the building of the
Q. Just before your brother disposed that 1/2 portion of the lot in plaintiff were damaged with the accumulated debris piled thereon.
question, what right of way does (sic) he use in reaching the public
road, kindly point to this sketch that he is (sic) using in reaching ISSUE:
the public road? whether or not proper precautions had been taken by the
A. In my property, sir. defendants in constructing the building in question so as
Q. Now you will agree with me . . . the main reason why your to prevent causing damage to the building of the plaintiff.
brother is (sic) using this property is because there was a store
located near this portion? HELD:
A. Yes, and according to the father of Yolanda there is no other No. Article 684 of the New Civil Code provides No property shall
way than this, sir. 17 make such excavations upon his land as to deprive any adjacent
The trial court found that Yolanda's property was situated at the land or building sufficient lateral or subjacent support. A reading
back of her father's property and held that there existed an of Article 684 shows that the duty of an adjacent owner not to
available space of about nineteen (19) meters long which could deprive any adjacent land or building of sufficient lateral or
conveniently serve as a right of way between the boundary line subjacent support is an absolute one. It does not depend on the
and the house of Yolanda's father; that the vacant space ended at degree of care and precaution made by the proprietor in making
the left back of Sotero's store which was made of strong materials; the excavation or building on his land. Plaintiffs house which
that this explained why Yolanda requested a detour to the lot of adjoins the seven storey concrete building constructed by the
Anastacia and cut an opening of one (1) meter wide and five (5) defendants had sunk by about eight inches. The sinking of the left
meters long to serve as her right of way to the public highway. But side of the house of the plaintiffs was due to the weakening of
notwithstanding its factual observations, the trial court concluded, subjacent support and to the weight of the seven storey concrete
although erroneously, that Yolanda was not entitled to a building constructed by the defendant, as the excavation made
right of way on petitioner's property since a detour through it would necessarily disturbed the subjacent soil of the plaintiffs land.
not make the line straight and would not be the route shortest to Defendants having failed to provide the plaintiffs land and house
the public highway. with sufficient lateral and subjacent support are liable for damages.
In applying Art. 650 of the New Civil Code, La Vista Association, Inc. v. Court of Appeals 278 SCRA 498
respondent Court of Appeals declared that the proposed FIRST DIVISION
right of way of Yolanda, which is one (1) meter wide and five (5) [G.R. No. 95252. September 5, 1997.]
meters long at the extreme right of petitioner's property, will cause LA VISTA ASSOCIATION, INC., petitioner, vs. COURT OF
the least prejudice and/or damage as compared to the suggested APPEALS, SOLID HOMES, INC., ATENEO DE MANILA
passage through the property of Yolanda's father which would UNIVERSITY, ROMULO VILLA, LORENZO TIMBOL, EMDEN
mean destroying the sari sari store made of strong materials. ENCARNACION, VICENTE CASIO, JR., DOMINGO REYES,
Absent any showing that these findings and conclusion are PEDRO C. MERCADO, MARIO AQUINO, RAFAEL GOSECO,
devoid of factual support in the records, or are so glaringly PORFIRIO CABALU, JR., and ANTONIO ADRIANO, in their
erroneous, this Court accepts and adopts them. As between a behalf and in behalf of the residents of LOYOLA GRAND
right of way that would demolish a store of strong materials VILLAS, INC., PHASES I AND II, respondents.
to provide egress to a public highway, and another Bonifacio A. Alentajan for petitioner.
right of way which although longer will only require an Angara, Abello, Concepcion Regala Cruz for respondents Romulo
avocado tree to be cut down, the second alternative should Villa, et al.
be preferred. After all, it is not the main function of this Court to Bengson Narciso Cudala Pecson & Jimenez for ADMU.
analyze or weigh the evidence presented all over again where the Tomas R. Leonidas for respondent Solid Homes.
petition would necessarily invite calibration of the whole evidence SYNOPSIS
The area comprising the 15-meter wide roadway was part of a land independently of the decision rendered on the merits of the main
owned by the Tuasons which was sold to Philippine Building case for injunction. The merits of the main case having been
Corporation by virtue of a Deed of Sale with Mortgage. Paragraph already determined in favor of the applicant, the preliminary
three (3) of the deed provides that ". . .the boundary line between determination of its non-existence ceases to have any force and
the property herein sold and the adjoining property of the effect.
VENDORS shall be a road fifteen (15) meters wide, one-half of 2. CIVIL LAW; PROPERTY, OWNERSHIP AND ITS
which shall be taken from the property herein sold to the VENDEE MODIFICATION; EASEMENT; LEGAL EASEMENT
and the other half from the portion adjoining belonging to the DISTINGUISHED FROM VOLUNTARY EASEMENT. A legal
VENDORS." The land was later sold to Ateneo de Manila or compulsory easement is that which is constituted by law for
University with the consent of the Tuasons. The Tuasons later public use or for private interest. By express provisions of Arts. 649
developed its 7.5 meter share of the Mangyan road, while Ateneo and 650 of the New Civil Code, the owner of an estate may claim
erected an adobe wall on the entire length of the boundary of its a legal or compulsory right-of-way only after he has established
property parallel to the 15-meter wide roadway which was later the existence of four (4) requisites, namely: (a) the estate is
removed due to an amicable settlement. Ateneo sold 16 hectares surrounded by other immovables and is without adequate outlet to
of its property along Mangyan road to Solid Homes, Inc. and the a public highway; (b) after payment of the proper indemnity; (c) the
deed of sale provided among others that the vendor passes unto isolation was not due to the proprietor's own acts; and (d) the right-
the vendee the privileges of such right-of-way. Subsequently, Solid of-way claimed is at a point least prejudicial to the servient estate,
Homes, Inc. developed the Loyola Grand Villas. La Vista, a and insofar as consistent with this rule, where the distance from
residential village developed by the Tuasons, prohibited the the dominant estate to a public highway may be shortest. A
agents and assignees of Solid Homes, Inc. and residents of Loyola voluntary easement on the other hand is constituted simply by will
from traversing the Mangyan Road. Solid Homes Inc. then or agreement of the parties.
instituted an action, and prayed that LA VISTA be enjoined from 3. ID.; ID.; ID.; EASEMENT IN CASE AT BAR A VOLUNTARY
preventing and obstructing the use and passage of LOYOLA ONE. From the facts of the instant case it is very apparent that
residents through Mangyan Road. The trial court issued a the parties and their respective predecessors-in-interest intended
preliminary injunction in favor of Solid Homes, Inc. which was to establish an easement of right-of-way over Mangyan Road for
nullified and set aside by the Appellate Court. In a petition for their mutual benefit, both as dominant and servient estates. This
review on certiorari filed with the Supreme Court, Solid Homes, is quite evident when: (a) the Tuasons and the Philippine Building
Inc. assailed the nullification and setting aside of the preliminary Corporation in 1949 stipulated in par. 3 of their Deed of Sale with
injunction issued by the trial court. Mortgage that the "boundary line between the property herein sold
Meanwhile, the Regional Trial Court of Quezon City rendered a and the adjoining property of the VENDORS shall be a road fifteen
decision on the merits affirming and recognizing the easement of (15) meters wide, one-half of which shall be taken from the
right-of-way along Mangyan Road in favor of Solid Homes, Inc. LA property herein sold to the VENDEE and the other half from the
VISTA appealed to the Court of Appeals, which affirmed in toto the portion adjoining belonging to the vendors"; (b) the Tuasons in
decision of the trial court. 1951 expressly agreed and consented to the assignment of the
The Supreme Court held that the opinion and findings of fact of a land to, and the assumption of all the rights and obligations by
court when issuing a writ preliminary injunction are interlocutory in ATENEO, including the obligation to contribute seven and one-half
nature and made even before the trial on the merits is terminated. meters of the property sold to form part of the 15-meter wide
Being an ancillary remedy, the proceedings for preliminary roadway; (c) the Tuasons in 1958 filed a complaint against
injunction cannot stand separately or proceed independently of the MARYKNOLL and ATENEO for breach of contract and the
decision rendered on the merits of the main case for injunction. enforcement of the reciprocal easement on Mangyan Road, and
The merits of the main case having been already determined in demanded that MARYKNOLL set back its wall to restore Mangyan
favor of the applicant, the preliminary determination of its non- Road to its original width of 15 meters, after MARYKNOLL
existence ceases to have any force and effect. constructed a wall in the middle of the 15 meter wide roadway; (d)
It is very apparent that the parties and their respective LA VISTA President Manuel J. Gonzales admitted and clarified in
predecessors-in-interest intended to establish an easement of 1976, in a letter to ATENEO President Fr. Jose A. Cruz, S.J., that
right-of-way over Mangyan Road for their mutual benefit, both as "Mangyan Road is a road fifteen meters wide, one half of which is
dominant and servient estates. The opening of an adequate outlet taken from your property and the other half from the La Vista
to a highway can extinguish only legal or compulsory easements, Subdivision. So that the easement of a right-of-way on your 7 1/2
not voluntary easements like in the case at bar. The fact that an m. portion was created in our favor and likewise an easement of
easement by grant may have also qualified as an easement of right-of-way was created on our 7 1/2 m. portion of the road in your
necessity does not detract from its permanency as a property right, favor"; (e) LA VISTA, in its offer to buy the hillside portion of the
which survives the termination of the necessity. ATENEO property in 1976, acknowledged the existence of the
SYLLABUS contractual right of-way as it manifested that the mutual right-of-
1. REMEDIAL LAW; PROVISIONAL REMEDIES; PRELIMINARY way between the Ateneo de Manila University and La Vista
INJUNCTION; ORDER ISSUING WRIT, INTERLOCUTORY. A Homeowners' Association would be extinguished if it bought the
writ of preliminary injunction is generally based solely on initial and adjacent ATENEO property and would thus become the owner of
incomplete evidence. The opinion and findings of fact of a court both the dominant and servient estates; and, (f) LA VISTA
when issuing a writ of preliminary injunction are interlocutory in President Luis G. Quimson, in a letter addressed to the Chief
nature and made even before the trial on the merits is terminated. Justice, received by this Court on 26 March 1997, acknowledged
Consequently there may be vital facts subsequently presented that "'one-half of the whole length of (Mangyan Road) belongs to
during the trial which were not obtaining when the writ of La Vista Assn., Inc. The other half is owned by Miriam (Maryknoll)
preliminary injunction was issued. Hence, to equate the basis for and the Ateneo in equal portions". These certainly are indubitable
the issuance of a preliminary injunction with that for the issuance proofs that the parties concerned had indeed constituted a
of a final injunctive writ is erroneous. And it does not necessarily voluntary easement of right-of-way over Mangyan Road and, like
mean that when a writ of preliminary injunction issues a final any other contract, the same could be extinguished only by mutual
injunction follows. We thus repeat what we said in Solid Homes, agreement or by renunciation of the owner of the dominant estate.
Inc., v. La Vista which respondent Court of Appeals quoted in its 4. ID.; ID.; ID.; ADEQUATE OUTLET TO A HIGHWAY CANNOT
assailed Decision Being an ancillary remedy, the proceedings EXTINGUISH VOLUNTARY EASEMENT. The argument of
for preliminary injunction cannot stand separately or proceed petitioner LA VISTA that there are other routes to LOYOLA from
Mangyan Road is likewise meritless, to say the least. The opening MANGYAN ROAD is a 15-meter wide thoroughfare in Quezon City
of an adequate outlet to a highway can extinguish only legal abutting Katipunan Avenue on the west, traversing the edges of
or compulsory easements, not voluntary easements like in La Vista Subdivision on the north and of the Ateneo de Manila
the case at bar. The fact that an easement by grant may have University and Maryknoll (now Miriam) College on the south.
also qualified as an easement of necessity does not detract from Mangyan Road serves as the boundary between LA VISTA on one
its permanency as a property right, which survives the termination side and ATENEO and MARYKNOLL on the other. It bends
of the necessity. towards the east and ends at the gate of Loyola Grand Villas
5. ID.; OBLIGATIONS AND CONTRACTS; PARTIES MAY Subdivision. The road has been the subject of an endless dispute,
STIPULATE TO OBSERVE PROVISIONS OF CONTRACT BY the disagreements always stemming from this unresolved issue:
ALL WHO IN THE FUTURE MAY SUCCEED THEM. That there Is there an easement of right-of-way over Mangyan Road?
is no contract between LA VISTA and Solid Homes, Inc. and thus In resolving this controversy, the Court would wish to write finis to
the court could not have declared the existence of an easement this seemingly interminable debate which has dragged on for more
created by the manifest will of the parties, is devoid of merit. The than twenty years.
predecessors-in-interest of both LA VISTA and Solid Homes, Inc.,
i.e., the Tuasons and the Philippine Building Corporation, The area comprising the 15-meter wide roadway was originally
respectively, clearly established a contractual easement of right- part of a vast tract of land owned by the Tuasons in Quezon City
of-way over Mangyan Road. When the Philippine Building and Marikina. On 1 July 1949 the Tuasons sold to Philippine
Corporation transferred its rights and obligations to ATENEO the Building Corporation a portion of their landholdings amounting to
Tuasons expressly consented and agreed thereto. Meanwhile, the 1,330,556 square meters by virtue of a Deed of Sale with
Tuasons themselves developed their property into what is now Mortgage. Paragraph three (3) of the deed provides that ". . . the
known as LA VISTA. On the other hand, ATENEO sold the hillside boundary line between the property herein sold and the adjoining
portions of its property to Solid Homes, Inc., including the right property of the VENDORS shall be a road fifteen (15) meters wide,
over the easement of right-of-way. In sum, when the easement in one-half of which shall be taken from the property herein sold to
this case was established by contract, the parties unequivocally the VENDEE and the other half from the portion adjoining
made provisions for its observance by all who in the future might belonging to the VENDORS."
succeed them in dominion.
6. REMEDIAL LAW; ACTIONS; INTERVENTION; ORDINARILY On 7 December 1951 the Philippine Building Corporation, which
NOT ALLOWED AFTER TRIAL; ALLOWED ON APPEAL FOR was then acting for and in behalf of Ateneo de Manila University
THOROUGH DISPOSITION OF CASE. Finally petitioner (ATENEO) in buying the properties from the Tuasons, sold,
questions the intervention of some LOYOLA residents at a time assigned and formally transferred in a Deed of Assignment with
when the case was already on appeal, and submits that Assumption of Mortgage, with the consent of the Tuasons, the
intervention is no longer permissible after trial has been subject parcel of land to ATENEO which assumed the mortgage.
concluded. Suffice it to say that in Director of Lands v. Court of The deed of assignment states
Appeals (93 SCRA 238, 245-246), we said It is quite clear and The ASSIGNEE hereby agrees and assumes to pay the mortgage
patent that the motions for intervention filed by the movants at this obligation on the above-described land in favor of the
stage of the proceedings where trial has already been concluded, MORTGAGOR and to perform any and all terms and conditions as
a judgment thereon had been promulgated in favor of private set forth in the Deed of Sale with Mortgage dated July 1, 1949,
respondent and on appeal by the losing party . . . the same was hereinabove referred to, which said document is incorporated
affirmed by the Court of Appeals and the instant petition for herein and made an integral part of this contract by reference . . .
certiorari to review said judgment is already submitted for decision
by the Supreme Court, are obviously and manifestly late, beyond On their part, the Tuasons developed a part of the estate adjoining
the period prescribed under . . . Section 2, Rule 12 of the Rules of the portion sold to Philippine Building Corporation into a residential
Court (now Sec. 2, Rule 19, 1997 Rules of Civil Procedure). But village known as La Vista Subdivision. Thus the boundary between
Rule 12 of the Rules of Court, like all other Rules therein LA VISTA and the portion sold to Philippine Building Corporation
promulgated, is simply a rule of procedure, the whole purpose and was the 15-meter wide roadway known as the Mangyan Road.
object of which is to make the powers of the Court fully and
completely available for justice. The purpose of procedure is not On 6 June 1952 ATENEO sold to MARYKNOLL the western
to thwart justice. Its proper aim is to facilitate the application of portion of the land adjacent to Mangyan Road. MARYKNOLL then
justice to the rival claims of contending parties. It was created not constructed a wall in the middle of the 15-meter wide roadway
to hinder and delay but to facilitate and promote the administration making one-half of Mangyan Road part of its school campus.
of justice. It does not constitute the thing itself which courts are The Tuasons objected and later filed a complaint before the then
always striving to secure to litigants. It is designed as the means Court of First Instance of Rizal for the demolition of the wall.
best adopted to obtain that thing. In other words, it is a means to Subsequently, in an amicable settlement, MARYKNOLL agreed to
an end. The denial of the motion for intervention arising from the remove the wall and restore Mangyan Road to its original width of
strict application of the Rule due to alleged lack of notice to, or the 15 meters.
alleged failure of, movants to act seasonably will lead the Court to Meanwhile, the Tuasons developed its 7.5-meter share of the 15-
commit an act of injustice to the movants, to their successors-in- meter wide boundary. ATENEO deferred improvement on its share
interests and to all purchasers for value and in good faith and and erected instead an adobe wall on the entire length of the
thereby open the door to fraud, falsehood and misrepresentation, boundary of its property parallel to the 15-meter wide roadway.
should intervenors' claims be proven to be true. After all, the On 30 January 1976 ATENEO informed LA VISTA of the former's
intervention does not appear to have been filed to delay the intention to develop some 16 hectares of its property along
proceedings. On the contrary, it seems to have expedited the Mangyan Road into a subdivision. In response, LA VISTA
resolution of the case as the incidents brought forth by the President Manuel J. Gonzales clarified certain aspects with regard
intervention, which could have been raised in another case, were to the use of Mangyan Road. Thus
resolved together with the issues herein resulting in a more . . . The Mangyan Road is a road fifteen meters wide, one-half of
thorough disposal of this case. which is taken from your property and the other half from the La
DECISION Vista Subdivision. So that the easement of a right-of-way on your
BELLOSILLO, J p: 7 m. portion was created in our favor and likewise an easement
of right-of-way was created on our 7 portion of the road in your
favor (paragraph 3 of the Deed of Sale between the Tuasons and in turn filed a third-party complaint against ATENEO. On 14
the Philippine Building Corporation and Ateneo de Manila dated 1 September 1983 the trial court issued a preliminary injunction in
July 1949 . . . favor of Solid Homes, Inc. (affirming an earlier order of 22
On 28 April 1976 LA VISTA President Manuel J. Gonzales, in a November 1977), directing LA VISTA to desist from blocking and
letter to ATENEO President Fr. Jose A. Cruz, S. J., offered to buy preventing the use of Mangyan Road. The injunction order of 14
under specified conditions the property ATENEO was intending to September 1983 was however nullified and set aside on 31 May
develop. One of the conditions stipulated by the LA VISTA 1985 by the then Intermediate Appellate Court 1 in AC-G.R. SP
President was that "[i]t is the essence of the offer that the mutual No. 02534. Thus in a petition for review on certiorari, docketed as
right of way between the Ateneo de Manila University and La Vista G.R. No. 71150, Solid Homes, Inc., assailed the nullification and
Homeowners' Association will be extinguished." The offer of LA setting aside of the preliminary injunction issued by the trial court.
VISTA to buy was not accepted by ATENEO. Instead, on 10 May Meanwhile, on 20 November 1987 the Regional Trial Court of
1976 ATENEO offered to sell the property to the public subject to Quezon City rendered a decision on the merits 2 in Civil Case No.
the condition that the right to use the 15-meter roadway will be Q-22450 affirming and recognizing the easement of right-of-way
transferred to the vendee who will negotiate with the legally along Mangyan Road in favor of Solid Homes, Inc., and ordering
involved parties regarding the use of such right as well as the LA VISTA to pay damages thus
development costs for improving the access road. ACCORDINGLY, judgment is hereby rendered declaring that an
LA VISTA became one of the bidders. However it lost to Solid easement of a right-of-way exists in favor of the plaintiff over
Homes, Inc., in the bidding. Thus on 29 October 1976 ATENEO Mangyan Road, and, consequently, the injunction prayed for by
executed a Deed of Sale in favor of Solid Homes, Inc., over the plaintiff is granted, enjoining thereby the defendant, its
parcels of land covering a total area of 124,424 square meters successors-in-interest, its/their agents and all persons acting for
subject, among others, to the condition that and on its/their behalf, from closing, obstructing, preventing or
7. The VENDOR hereby passes unto the VENDEE, its assigns otherwise refusing to the plaintiff, its successors-in-interest,
and successors-in-interest the privileges of such right of way which its/their agents and all persons acting for and on its/their behalf,
the VENDOR acquired, and still has, by virtue of the Deeds and to the public in general, the unobstructed ingress and egress
mentioned in the immediately preceeding paragraph hereof; on Mangyan Road, which is the boundary road between the La
provided, that the VENDOR shall nonetheless continue to enjoy Vista Subdivision on one hand, and the Ateneo de Manila
said right of way privileges with the VENDEE, which right of way University, Quezon City, and the Loyola Grand Villas Subdivision,
in favor of the VENDOR shall be annotated on the pertinent road Marikina, Metro Manila, on the other; and, in addition the
lot titles. However it is hereby agreed that the implementation of defendant is ordered to pay the plaintiff reasonable attorney's fees
such right of way shall be for the VENDEE's sole responsibility and in the amount of P30,000.00. The defendant-third-party plaintiff is
liability, and likewise any development of such right of way shall also ordered to pay the third-party defendant reasonable
be for the full account of the VENDEE. In the future, if needed, the attorney's fees for another amount of P15,000.00. The counter-
VENDOR is therefore free to make use of the aforesaid right of claim of the defendant against the plaintiff is dismissed for lack of
way, and/or Mangyan Road access, but in such a case the merit. With costs against the defendant.
VENDOR shall contribute a pro-rata share in the maintenance of
the area. Quite expectedly, LA VISTA appealed to the Court of Appeals,
Subsequently, Solid Homes, Inc., developed a subdivision now docketed as CA-G.R. CV No. 19929. On 20 April 1988 this Court,
known as Loyola Grand Villas and together they now claim to have taking into consideration the 20 November 1987 Decision of the
an easement of right-of-way along Mangyan Road through which trial court, dismissed the petition docketed as G.R. No. 71150
they could have access to Katipunan Avenue. wherein Solid Homes, Inc., sought reversal of the 31 May 1985
Decision in AC-G.R. SP No. 02534 which nullified and set aside
LA VISTA President Manuel J. Gonzales however informed the 14 September 1983 injunction order of the trial court. There we
Solid Homes, Inc., that LA VISTA could not recognize the said
right-of-way over Mangyan Road because, first, Philippine Considering that preliminary injunction is a provisional remedy
Building Corporation and its assignee ATENEO never which may be granted at any time after the commencement of the
complied with their obligation of providing the Tuasons with action and before judgment when it is established that the plaintiff
a right-of-way on their 7.5-meter portion of the road and, is entitled to the relief demanded and only when his complaint
second, since the property was purchased for commercial shows facts entitling such reliefs (Section 3(a), Rule 58) and it
purposes, Solid Homes, Inc., was no longer entitled to the appearing that the trial court had already granted the issuance of
right-of-way as Mangyan Road was established exclusively a final injunction in favor of petitioner in its decision rendered after
for ATENEO in whose favor the right-of-way was originally trial on the merits (Sections 7 & 10, Rule 58, Rules of Court), the
constituted. LA VISTA, after instructing its security guards to Court resolved to Dismiss the instant petition having been
prohibit agents and assignees of Solid Homes, Inc., from rendered moot and academic. An injunction issued by the trial
traversing Mangyan Road, then constructed one-meter high court after it has already made a clear pronouncement as to the
cylindrical concrete posts chained together at the middle of and plaintiff's right thereto, that is, after the same issue has been
along the entire length of Mangyan Road thus preventing the decided on the merits, the trial court having appreciated the
residents of LOYOLA from passing through. evidence presented, is proper, notwithstanding the fact that the
Solid Homes, Inc., complained to LA VISTA but the concrete posts decision rendered is not yet final (II Moran, pp. 81-82, 1980 ed.)
were not removed. To gain access to LOYOLA through Mangyan Being an ancillary remedy, the proceedings for preliminary
Road an opening through the adobe wall of ATENEO was made injunction cannot stand separately or proceed independently of the
and some six (6) cylindrical concrete posts of LA VISTA were decision rendered on the merit of the main case for injunction. The
destroyed. LA VISTA then stationed security guards in the area to merit of the main case having been already determined in favor of
prevent entry to LOYOLA through Mangyan Road. the applicant, the preliminary determination of its non-existence
ceases to have any force and effect. 3
On 17 December 1976, to avert violence, Solid Homes, Inc., On the other hand, in CA-G.R. CV No. 19929, several incidents
instituted the instant case, docketed as Civil Case No. Q-22450, were presented for resolution: two (2) motions filed by Solid
before the then Court of First Instance of Rizal and prayed that LA Homes, Inc., to cite certain officers of LA VISTA for contempt for
VISTA be enjoined from preventing and obstructing the use and alleged violation of the injunction ordaining free access to and
passage of LOYOLA residents through Mangyan Road. LA VISTA egress from Mangyan Road, to which LA VISTA responded with
its own motion to cite Solid Homes, Inc., for contempt; a motion for evidence. The opinion and findings of fact of a court when issuing
leave to intervene and to re-open Mangyan Road filed by residents a writ of preliminary injunction are interlocutory in nature and made
of LOYOLA; and, a petition praying for the issuance of a even before the trial on the merits is terminated. Consequently
restraining order to enjoin the closing of Mangyan Road. On 21 there may be vital facts subsequently presented during the trial
September 1989 the incidents were resolved by the Court of which were not obtaining when the writ of preliminary injunction
Appeals 4 thus was issued. Hence, to equate the basis for the issuance of a
1. Defendant-appellant La Vista Association, Inc., its Board of preliminary injunction with that for the issuance of a final injunctive
Directors and other officials and all persons acting under their writ is erroneous. And it does not necessarily mean that when a
orders and in their behalf are ordered to allow all residents of writ of preliminary injunction issues a final injunction follows.
Phase I and II of Loyola Grand Villas unobstructed right-of-way or Accordingly, respondent Court of Appeals in its assailed Decision
passage through the Mangyan Road which is the boundary rightly held that
between the La Vista Subdivision and the Loyola Grand Villas We are unswayed by appellant's theory that the cases cited by
Subdivision; them in their Brief (pages 17 and 32) and in their motion for early
2. The motion to intervene as plaintiffs filed by the residents of resolution (page 11, Rollo) to buttress the first assigned error, are
Loyola Grand Villas Subdivision is GRANTED; and final judgments on the merits of, and therefore res judicata to the
3. The motions for contempt filed by both plaintiff-appellee and instant query. It is quite strange that appellant was extremely
defendant-appellant are DENIED. cautious in not mentioning this doctrine but the vague disquisition
This resolution is immediately executory. 5 nevertheless points to this same tenet, which upon closer
On 15 December 1989 both motions for reconsideration of Solid examination negates the very proposition. Generally, it is
Homes, Inc., and LA VISTA were denied. In separate petitions, axiomatic that res judicata will attach in favor of La Vista if and
both elevated the 21 September 1989 and 15 December 1989 when the case under review was disposed of on the merits and
Resolutions of the Court of Appeals to this Court. The petition of with finality (Manila Electric Co. vs. Artiaga, 50 Phil. 144;
Solid Homes, Inc., docketed as G.R. No. 91433, prayed for an 147; S . Diego vs. Carmona, 70 Phil. 281; 283; cited in Comments
order directing the appellate court to take cognizance of and hear on the Rules of Court, by Moran, Volume II, 1970 edition, page
the motions for contempt, while that of LA VISTA in G.R. No. 365; Roman Catholic Archbishop vs. Director of Lands, 35 Phil.
91502 sought the issuance of a preliminary injunction to order 339; 350-351, cited in Remedial Law Compendium, by Regalado,
Solid Homes, Inc., ATENEO and LOYOLA residents to desist from Volume 1, 1986 Fourth Revised Edition, page 40). Appellants
intruding into Mangyan Road. suffer from the mistaken notion that the "merits" of the certiorari
On 22 May 1990, pending resolution of G.R. Nos. 91433 and petitions impugning the preliminary injunction in the cases cited by
91502, the Second Division of the Court of Appeals 6 in CA-G.R. it are tantamount to the merits of the main case, subject of the
CV No. 19929 affirmed in toto the Decision of the trial court in Civil instant appeal. Quite the contrary, the so-called "final judgments''
Case No. Q-22450. On 6 September 1990 the motions for adverted to dealt only with the propriety of the issuance or non-
reconsideration and/or re-raffle and to set the case for oral issuance of the writ of preliminary injunction, unlike the present
argument were denied. In view of the affirmance of the Decision recourse which is directed against a final injunctive writ under
by the Court of Appeals in CA-G.R. CV No. 19929 this Court Section 10, Rule 58. Thus the invocation of the disputed matter
dismissed the petition in G.R. No. 91502 for being moot as its main herein is misplaced. 14
concern was merely the validity of a provisional or preliminary
injunction earlier issued. We also denied the petition in G.R. No. We thus repeat what we said in Solid Homes, Inc., v. La
91433 in the absence of a discernible grave abuse of discretion in Vista 15 which respondent Court of Appeals quoted in its assailed
the ruling of the appellate court that it could not entertain the Decision 16
motions to cite the parties for contempt "because a charge of Being an ancillary remedy, the proceedings for preliminary
contempt committed against a superior court may be filed only injunction cannot stand separately or proceed independently of the
before the court against whom the contempt has been committed" decision rendered on the merits of the main case for injunction.
(Sec. 4, Rule 71, Rules of Court). 7 The merits of the main case having been already determined in
favor of the applicant, the preliminary determination of its non-
Consequently we are left with the instant case where petitioner LA existence ceases to have any force and effect.
VISTA assails the Decision of respondent Court of Appeals Petitioner LA VISTA in its lengthy Memorandum also quotes our
affirming in toto the Decision of the trial court which rendered a ruling in Ramos, Sr., v. Gatchalian Realty, Inc., 17 no less than
judgment on the merits and recognized an easement of right-of- five (5) times 18
way along Mangyan Road, permanently enjoining LA VISTA from To allow the petitioner access to Sucat Road through Gatchalian
closing to Solid Homes, Inc., and its successors-in-interest the Avenue inspite of a road right-of-way provided by the petitioner's
ingress and egress on Mangyan Road. subdivision for its buyers simply because Gatchalian Avenue
allows petitioner a much greater ease in going to and coming from
In its first assigned error, petitioner LA VISTA argues that the main thoroughfare is to completely ignore what jurisprudence
respondent appellate court erred in disregarding the decisions in has consistently maintained through the years regarding an
(a) La Vista Association, Inc., v. Hon.Ortiz, 8 affirmed by this Court easement of a right-of-way, that 'mere convenience for the
in Tecson v. Court of Appeals; 9 (b) La Vista Association, Inc., dominant estate is not enough to serve as its basis. To justify the
v. Hon. Leviste, 10 affirmed by this Court in Rivera imposition of this servitude, there must be a real, not a fictitious or
v. Hon.Intermediate Appellate Court; 11 and, (c) La Vista artificial, necessity for it' (See Tolentino, Civil Code of the
v. Hon. Mendoza, 12 and in holding that an easement of right-of- Philippines, Vol. II, 2nd ed., 1972, p. 371)
way over Mangyan Road exists. 13 Again this is misplaced. Ramos, Sr., v. Gatchalian Realty,
Inc., 19 concerns a legal or compulsory easement of right-of-way
We do not agree with petitioner. The reliance of petitioner on the
cited cases is out of place as they involve the issuance of a Since there is no agreement between the contending parties in this
preliminary injunction pending resolution of a case on the merits. case granting a right-of-way by one in favor of the other, the
In the instant case, however, the subject of inquiry is not merely establishment of a voluntary easement between the petitioner and
the issuance of a preliminary injunction but the final injunctive writ the respondent company and/or the other private respondents is
which was issued after trial on the merits. A writ of preliminary ruled out. What is left to examine is whether or not petitioner is
injunction is generally based solely on initial and incomplete entitled to a legal or compulsory easement of a right-of-way
which should be distinguished from a voluntary easement. A legal existence of a servitude thereon from their express admission to
or compulsory easement is that which is constituted by law for the contrary (paragraph 1, Answer).
public use or for private interest. By express provisions of Arts. 649 One's attention should rather be focused on the contractual
and 650 of the New Civil Code, the owner of an estate may claim stipulations in the deed of sale between the Tuason Family and
a legal or compulsory right-of-way only after he has established the Philippine Building Corporation (paragraph 3, thereof) which
the existence of four (4) requisites, namely, (a) the estate is were incorporated in the deed of assignment with assumption of
surrounded by other immovables and is without adequate outlet to mortgage by the Philippine Building Corporation in favor of Ateneo
a public highway; (b) after payment of the proper indemnity; (c) the (first paragraph, page 4 of the deed) as well as in the deed of sale
isolation was not due to the proprietor's own acts; and, (d) the dated October 24, 1976 when the property was ultimately
right-of-way claimed is at a point least prejudicial to the servient transferred by Ateneo to plaintiff-appellee. Like any other
estate, and insofar as consistent with this rule, where the distance contractual stipulation, the same cannot be extinguished except
from the dominant estate to a public highway may be the by voluntary rescission of the contract establishing the servitude
shortest. 20 A voluntary easement on the other hand is constituted or renunciation by the owner of the dominant lots (Chuanico
simply by will or agreement of the parties. vs. Ibaez, 7 CA Reports, 2nd Series, 1965 edition, pages 582;
589, cited in Civil Law Annotated, by Padilla, Volume II, 1972
From the facts of the instant case it is very apparent that the parties Edition, pages 602-603), more so when the easement was
and their respective predecessors-in-interest intended to establish implicitly recognized by the letters of the La Vista President to
an easement of right-of-way over Mangyan Road for their mutual Ateneo dated February 11 and April 28, 1976 (page 22, Decision;
benefit, both as dominant and servient estates. This is quite 19 Ruling Case Law 745).
evident when: (a) the Tuasons and the Philippine Building The free ingress and egress along Mangyan Road created by the
Corporation in 1949 stipulated in par. 3 of their Deed of Sale with voluntary agreement between Ateneo and Solid Homes, Inc., is
Mortgage that the "boundary line between the property herein sold thus legally demandable (Articles 619 and 625, New Civil Code)
and the adjoining property of the VENDORS shall be a road fifteen with the corresponding duty on the servient estate not to obstruct
(15) meters wide, one-half of which shall be taken from the the same so much so that
property herein sold to the VENDEE and the other half from the When the owner of the servient tenement performs acts or
portion adjoining belonging to the vendors;" (b) the Tuasons in constructs works impairing the use of the servitude, the owner of
1951 expressly agreed and consented to the assignment of the the dominant tenement may ask for the destruction of such works
land to, and the assumption of all the rights and obligations by and the restoration of the things to their condition before the
ATENEO, including the obligation to contribute seven and one-half impairment was committed, with indemnity for damages suffered
meters of the property sold to form part of the 15-meter wide (3 Sanchez Roman 609). An injunction may also be obtained in
roadway; (c) the Tuasons in 1958 filed a complaint against order to restrain the owner of the servient tenement from
MARYKNOLL and ATENEO for breach of contract and the obstructing or impairing in any manner the lawful use of the
enforcement of the reciprocal easement on Mangyan Road, and servitude (Resolme v. Lazo, 27 Phil. 416; 417; 418)."
demanded that MARYKNOLL set back its wall to restore Mangyan (Commentaries and Jurisprudence on the Civil Code of the
Road to its original width of 15 meters, after MARYKNOLL Philippines, by Tolentino, Volume 2, 1963 edition, page 320). 21
constructed a wall in the middle of the 15-meter wide roadway; (d) Resultantly, when the court says that an easement exists, it is not
LA VISTA President Manuel J. Gonzales admitted and clarified in creating one. For, even an injunction cannot be used to create one
1976, in a letter to ATENEO President Fr. Jose A. Cruz, S.J., that as there is no such thing as a judicial easement. As in the instant
"Mangyan Road is a road fifteen meters wide, one-half of which is case, the court merely declares the existence of an easement
taken from your property and the other half from the La Vista created by the parties. Respondent court could not have said it any
Subdivision. So that the easement of a right-of-way on your 7 better
m. portion was created in our favor and likewise an easement
of right-of-way was created on our 7 m. portion of the road in It must be emphasized, however, that We are not constituting an
your favor;" (e) LA VISTA, in its offer to buy the hillside portion of easement along Mangyan Road, but merely declaring the
the ATENEO property in 1976, acknowledged the existence of the existence of one created by the manifest will of the parties herein
contractual right-of-way as it manifested that the mutual right-of- in recognition of autonomy of contracts (Articles 1306 and 619,
way between the Ateneo de Manila University and La Vista New Civil Code; Tolentino, supra, page 308; Civil Code of the
Homeowners' Association would be extinguished if it bought the Philippines, by Paras, Volume II, 1984 edition, page 549). 22
adjacent ATENEO property and would thus become the owner of The argument of petitioner LA VISTA that there are other routes to
both the dominant and servient estates; and, (f) LA VISTA LOYOLA from Mangyan Road is likewise meritless, to say the
President Luis G. Quimson, in a letter addressed to the Chief least. The opening of an adequate outlet to a highway can
Justice, received by this Court on 26 March 1997, acknowledged extinguish only legal or compulsory easements, not voluntary
that "one-half of the whole length of (Mangyan Road) belongs to easements like in the case at bar. The fact that an easement by
La Vista Assn., Inc. The other half is owned by Miriam (Maryknoll) grant may have also qualified as an easement of necessity does
and the Ateneo in equal portions;" not detract from its permanency as a property right, which survives
These certainly are indubitable proofs that the parties the termination of the necessity. 23
concerned had indeed constituted a voluntary easement of That there is no contract between LA VISTA and Solid Homes,
right-of-way over Mangyan Road and, like any other contract, Inc., and thus the court could not have declared the existence of
the same could be extinguished only by mutual agreement or an easement created by the manifest will of the parties, is devoid
by renunciation of the owner of the dominant estate. Thus of merit. The predecessors-in-interest of both LA VISTA and Solid
respondent Court of Appeals did not commit a reversible error Homes, Inc., i.e., the Tuasons and the Philippine Building
when it ruled that Corporation, respectively, clearly established a contractual
Concerning the pivotal question posed herein on the existence of easement of right-of-way over Mangyan Road. When the
an easement, we are of the belief, and thus hereby hold that a Philippine Building Corporation transferred its rights and
right-of-way was properly appreciated along the entire route of obligations to ATENEO the Tuasons expressly consented and
Mangyan Road. Incidentally, the pretense that the court a agreed thereto. Meanwhile, the Tuasons themselves developed
quo erred in holding that Mangyan Road is the boundary road their property into what is now known as LA VISTA. On the other
between La Vista and Ateneo (page 31, Appellant's Brief) does not hand, ATENEO sold the hillside portions of its property to Solid
raise any critical eyebrow since the same is wholly irrelevant to the Homes, Inc., including the right over the easement of right-of-way.
In sum, when the easement in this case was established by Pedro F. Alcantara, Jr. for petitioners.
contract, the parties unequivocally made provisions for its Garcia Iigo De Guzman Sarsaba Heje & Associates for
observance by all who in the future might succeed them in private respondent.
dominion. SYNOPSIS
Petitioners filed a complaint for the exercise of their right of first
The contractual easement of right-of-way having been confirmed, refusal to purchase subject property in accordance with Section
we find no reason to delve on the issue concerning P.D. No. 3(g) of P.D. No. 1517, claiming they are the legitimate tenants or
957 which supposedly grants free access to any subdivision street lessees thereof. Both the trial court and the CA dismissed the
to government or public offices within the subdivision. In the instant complaint.
case, the rights under the law have already been superseded by On appeal, the Supreme Court held: that P.D. No. 1517, otherwise
the voluntary easement of right-of-way. known as the "Urban Land Reform Act," pertains to areas
proclaimed as Urban Land Reform Zones; that subject land is
Finally, petitioner questions the intervention of some LOYOLA beyond the ambit of P.D. No. 1517 since it has not been
residents at a time when the case was already on appeal, and proclaimed as an Urban Land Reform Zone; that the applicable
submits that intervention is no longer permissible after trial has law is BP Blg. 25 for failure of petitioners to pay rentals; and that
been concluded. Suffice it to say that in Director of Lands v. Court petitioners are not the legitimate tenants contemplated by PD No.
of Appeals, 24 we said 1517, who can exercise the right of first refusal. aECSHI
It is quite clear and patent that the motions for intervention filed by SYLLABUS
the movants at this stage of the proceedings where trial has 1. CIVIL LAW; LEASE; THE URBAN LAND REFORM ACT (P.D.
already been concluded, a judgment thereon had been NO. 1517); PERTAINS TO AREAS PROCLAIMED AS URBAN
promulgated in favor of private respondent and on appeal by the LAND REFORM ZONES; CASE AT BAR. Presidential Decree
losing party . . . the same was affirmed by the Court of Appeals No. 1517, otherwise known as "The Urban Land Reform Act,"
and the instant petition for certiorari to review said judgment is pertains to areas proclaimed as Urban Land Reform Zones.
already submitted for decision by the Supreme Court, are Consequently, petitioners cannot claim any right under the said
obviously and manifestly late, beyond the period prescribed under law since the land involved is not an ULRZ.
. . . Section 2, Rule 12 of the Rules of Court (now Sec. 2, Rule 19, 2. ID.; ID.; ID.; ID.; RIGHT OF FIRST REFUSAL MAY BE
1997 Rules of Civil Procedure). AVAILED OF ONLY BY LEGITIMATE TENANT OF THE LAND;
But Rule 12 of the Rules of Court, like all other Rules therein CASE AT BAR. To be able to qualify and avail oneself of the
promulgated, is simply a rule of procedure, the whole purpose and rights and privileges granted by the said decree, one must be: (1)
object of which is to make the powers of the Court fully and a legitimate tenant of the land for ten (10) years or more; (2) must
completely available for justice. The purpose of procedure is not have built his home on the land by contract; and, (3) has resided
to thwart justice. Its proper aim is to facilitate the application of continuously for the last ten (10) years. Obviously, those who do
justice to the rival claims of contending parties. It was created not not fall within the said category cannot be considered "legitimate
to hinder and delay but to facilitate and promote the administration tenants" and, therefore, not entitled to the right of first refusal to
of justice. It does not constitute the thing itself which courts are purchase the property should the owner of the land decide to sell
always striving to secure to litigants. It is designed as the means the same at a reasonable price within a reasonable time.
best adopted to obtain that thing. In other words, it is a means to Respondent Reta denies that he has lease agreements with
an end. petitioners Edilberto Alcantara and Ricardo Roble. Edilberto
The denial of the motions for intervention arising from the strict Alcantara, on the other hand, failed to present proof of a lease
application of the Rule due to alleged lack of notice to, or the agreement other than his testimony in court that he bought the
alleged failure of, movants to act seasonably will lead the Court to house that he is occupying from his father-in-law. Respondent
commit an act of injustice to the movants, to their successors-in- Reta allowed petitioner Ricardo Roble to use sixty-two (62)
interest and to all purchasers for value and in good faith and coconut trees for P186 from where he gathered tuba. This
thereby open the door to fraud, falsehood and misrepresentation, arrangement would show that it is a usufruct and not a lease.
should intervenors' claims be proven to be true. Usufruct gives a right to enjoy the property of another with the
After all, the intervention does not appear to have been filed to obligation of preserving its form and substance, unless the title
delay the proceedings. On the contrary, it seems to have constituting it or the law otherwise provides. Petitioner Roble was
expedited the resolution of the case as the incidents brought forth allowed to construct his house on the land because it would
by the intervention, which could have been raised in another case, facilitate his gathering of tuba. This would be in the nature of a
were resolved together with the issues herein resulting in a more personal easement under Article 614 of the Civil Code. Whether
thorough disposal of this case. the amicable settlement is valid or not, the conclusion would still
WHEREFORE, the Decision of respondent Court of Appeals dated be the same since the agreement was one of usufruct and not of
22 May 1990 and its Resolution dated 6 September 1990, which lease. Thus, petitioner Roble is not a legitimate tenant as defined
affirmed the Decision of the RTC-Br. 89, Quezon City, dated 20 by Presidential Decree No. 1517. As to the other petitioners,
November 1987, are AFFIRMED. respondent Reta admitted that he had verbal agreements with
SO ORDERED. them. This notwithstanding, they are still not the legitimate tenants
||| (La Vista Association, Inc. v. Court of Appeals, G.R. No. 95252, contemplated by Presidential Decree No. 1517, who can exercise
[September 5, 1997], 344 PHIL 30-51) the right of first refusal.
DECISION
Alcantara v. Reta, Jr. 372 SCRA 364 PARDO, J p:
FIRST DIVISION The Case
[G.R. No. 136996. December 14, 2001.] In this petition for review, 1 petitioners seek to review the
EDILBERTO ALCANTARA, FLORENCIO VILLARMIA, decision 2 of the Court of Appeals affirming the decision 3 of the
POLICARPIO OBREGON, + RICARDO ROBLE, ESCOLASTICA Regional Trial Court, Davao City, Branch 14, dismissing
ONDONG, ESTEBAN RALLOS, HENRY SESBINO, SERGIO petitioners' complaint for the exercise of the right of first refusal
SESBINO, MANUEL CENTENO, + RENATO CRUZ, under Presidential Decree No. 1517, injunction with preliminary
MARCELINO CENEZA, BUENAVENTURA ONDONG, and injunction, attorney's fees and nullity of amicable settlement.
BENJAMIN HALASAN, petitioners, vs. CORNELIO B. RETA, FACTS:
JR., respondent.
Edilberto Alcantara, Florencio Villarmia, Policarpio Obregon, Alcantara, on the other hand, failed to present proof of a lease
Ricardo Roble, Escolastica Ondong, Esteban Rallos, Henry agreement other than his testimony in court that he bought the
Sesbino, Sergio Sesbino, Manuel Centeno, Renato Cruz, Marcelo house that he is occupying from his father-in-law. 14
Ceneza, Buenaventura Ondong and Benjamin Halasan, filed with Respondent Reta allowed petitioner Ricardo Roble to use
the Regional Trial Court, Davao City, Branch 14, a sixty-two (62) coconut trees for P186 from where he
complaint 4against Cornelio B. Reta, Jr. for the exercise of the gathered tuba. This arrangement would show that it is a
right of first refusal under Presidential Decree No. 1517, injunction usufruct and not a lease. Usufruct gives a right to enjoy the
with preliminary injunction, attorney's fees and nullity of amicable property of another with the obligation of preserving its form and
settlement. substance, unless the title constituting it or the law otherwise
The plaintiffs claimed that they were tenants or lessees of the land provides. 15
located in Barangay Sasa, Davao City, covered by Transfer Petitioner Roble was allowed to construct his house on the land
Certificate of Title No. T-72594, owned by Reta; that the land has because it would facilitate his gathering of tuba. This would be in
been converted by Reta into a commercial center; and that Reta the nature of a personal easement under Article 614 of the Civil
is threatening to eject them from the land. They assert that they Code. 16
have the right of first refusal to purchase the land in accordance Whether the amicable settlement 17 is valid or not, the conclusion
with Section 3(g) of Presidential Decree No. 1517 since they are would still be the same since the agreement was one of usufruct
legitimate tenants or lessees thereof. and not of lease. Thus, petitioner Roble is not a legitimate tenant
They also claimed that the amicable settlement executed between as defined by Presidential Decree No. 1517.
Reta and Ricardo Roble was void ab initio for being violative As to the other petitioners, respondent Reta admitted that he had
of Presidential Decree No. 1517. verbal agreements with them. This notwithstanding, they are still
not the legitimate tenants contemplated by Presidential Decree
On the other hand, Reta claimed that the land is beyond the ambit No. 1517, who can exercise the right of first refusal.
of Presidential Decree No. 1517 since it has not been proclaimed A contract has been defined as "a meeting of the minds between
as an Urban Land Reform Zone; that the applicable law is Batas two persons whereby one binds himself, with respect to the other,
Pambansa Blg. 25 for failure of the plaintiffs to pay the rentals for to give something or to render some service.'' 18
the use of the land; and that the amicable settlement between him Clearly, from the moment respondent Reta demanded that the
and Ricardo Roble was translated to the latter and fully explained petitioners vacate the premises, the verbal lease agreements,
in his own dialect. which were on a monthly basis since rentals were paid
monthly, 19 ceased to exist as there was termination of the
On March 8, 1994, the trial court rendered a decision dismissing lease. ACTaDH
the complaint and ordering the plaintiffs to pay Reta certain sums Indeed, none of the petitioners is qualified to exercise the right of
representing rentals that had remained unpaid. 5 first refusal under P.D. No. 1517.
On April 6, 1994, plaintiffs appealed the decision to the Court of Another factor which militates against petitioners' claim is the fact
Appeals. 6 that there is no intention on the part of respondent Reta to sell the
On December 9, 1998, the Court of Appeals promulgated a property. Hence, even if the petitioners had the right of first refusal,
decision 7 affirming in toto the decision of the trial court. the situation which would allow the exercise of that right, that is,
Hence, this appeal. 8 the sale or intended sale of the land, has not happened. P.D. No.
1517 applies where the owner of the property intends to sell it to a
The Issue third party. 20
The issue is whether petitioners have the right of first refusal
under Presidential Decree No. 1517. The Fallo
WHEREFORE, the Court DENIES the petition. The Court
The Court's Ruling AFFIRMS the decision of the Court of Appeals 21 and the
The petition is without merit. resolution denying reconsideration thereof.
The area involved has not been proclaimed an Urban Land Reform No costs.
Zone (ULRZ). In fact, petitioners filed a petition with the National SO ORDERED.
Housing Authority requesting that the land they were occupying be ||| (Alcantara v. Reta, Jr., G.R. No. 136996, [December 14, 2001],
declared as an ULRZ. On May 27, 1986, the request was referred 423 PHIL 623-629)
to Mr. Jose L. Atienza, General Manager, National Housing
Authority, for appropriate action. 9 The request was further Prosperity Credit Resources, Inc. v. Court of Appeals 301 SCRA
referred to acting mayor Zafiro Respicio, Davao City, as per 2nd 52
Indorsement dated July 1, 1986. 10 Clearly, the request to have SECOND DIVISION
the land proclaimed as an ULRZ would not be necessary if the [G.R. No. 114170. January 15, 1999.]
property was an ULRZ. PROSPERITY CREDIT RESOURCES, INC., petitioner, vs.
Presidential Decree No. 1517, otherwise known as "The Urban COURT OF APPEALS and METROPOLITAN FABRICS,
Land Reform Act," pertains to areas proclaimed as Urban Land INC., respondents.
Reform Zones. 11 Consequently, petitioners cannot claim any Gonzales Batiller Bilog and Associates for petitioner.
right under the said law since the land involved is not an ULRZ. Ceferino Padua Law Office for private respondent.
To be able to qualify and avail oneself of the rights and privileges SYNOPSIS
granted by the said decree, one must be: (1) a legitimate tenant of On November 7, 1991, petitioner filed an injunctive suit in the
the land for ten (10) years or more; (2) must have built his home Regional Trial Court of Quezon City. Petitioner alleged that in
on the land by contract; and, (3) has resided continuously for the violation of the terms of the Memorandum of Agreement, private
last ten (10) years. Obviously, those who do not fall within the said respondent refused to allow petitioner to make excavations on one
category cannot be considered "legitimate tenants" and, therefore, side of the access road for the installation of water pipes; that it
not entitled to the right of first refusal to purchase the property banned entry of petitioner's truck and those of its tenants between
should the owner of the land decide to sell the same at a 11:30 AM to 1:00 PM and 10:00 PM to 7:00 AM; and that it
reasonable price within a reasonable time. 12 subjected the vehicles to unnecessary searches. Petitioner sought
Respondent Reta denies that he has lease agreements with the issuance of a writ of preliminary injunction requiring private
petitioners Edilberto Alcantara and Ricardo Roble. 13 Edilberto respondent to allow to proceed with the MWSS installation project
over the road lot in question, to allow petitioner's and its tenant's showing the parties' intention in using the word which can only be
delivery trucks and other vehicles access to the same at any time done during trial on the merits. Until such time, petitioner cannot
and without undergoing unnecessary searches, and to otherwise claim to have a "clear and unmistakable" right justifying the
recognize petitioner's right of way over said lot. After trial on the issuance of a writ of preliminary mandatory injunction in this case.
merits, the court a quogranted petitioner's prayer of preliminary Thus, the trial court should have observed caution and denied
injunction. Aggrieved by the decision, private respondent filed a petitioner's application for the preliminary writ. TDAHCS
petition for certiorari and prohibition with the Court of Appeals to DECISION
annul the order of the Regional Trial Court. On November 26, MENDOZA, J p:
1994, the appellate court granted the petition and set aside the For review in this case is a decision 1 of the Sixth Division of the
questioned orders after finding that the trial court had acted with Court of Appeals in CA G.R. 28684-SP dated November 26, 1993
grave abuse of discretion in issuing them. Its motion for setting aside a writ of preliminary mandatory injunction issued by
reconsideration having been denied, petitioner filed the petition for the Regional Trial Court of Quezon City (Branch 95).
review on certiorari. TaDSCA
The Supreme Court found the petition devoid of merit. The Court On August 3, 1984, petitioner Prosperity Credit Resources, Inc.
ruled that the right of the complainant to justify the issuance of gave a loan to private respondent Metropolitan Fabrics, Inc. 2 To
preliminary mandatory injunction must be clear and unmistakable secure the payment of the loan, private respondent mortgaged to
because it requires the performance of a particular act or acts and petitioner seven parcels of land located at 685 Tandang Sora
thus tends to do more than maintain the status quo. In this case, Avenue, Bo. Banlat, Quezon City. 3 The lots comprise a
the Court found that the word "passage" stated in the commercial compound with Tandang Sora Avenue as the nearest
memorandum does not clearly and unmistakably convey a public road.
meaning that includes a right to install water pipes on the access By October 27, 1987, private respondent's loan amounted to
road. To achieve a meaning such as that which petitioner P10.5 million. 4 As private respondent defaulted in the payment of
proposes requires the consideration of evidence showing the the loan, petitioner foreclosed the mortgage and, in the ensuing
parties' intention in using the word which can only be done during public bidding, became the highest bidder and purchaser of the
trial on the merits. Until such time, petitioner cannot claim to have seven (7) lots subject of the mortgage.
a clear and unmistakable right justifying the issuance of a writ of
preliminary mandatory injunction in this case. Thus, the trial court Later, private respondent negotiated with petitioner for the
should have observed caution and denied petitioner's application redemption of three lots covered by TCT Nos. 317705, 317706,
for the preliminary writ. Accordingly, the decision of the Court of and 317707, 5 all located on the southern and middle portions of
Appeals dated November 26, 1993 and its resolution dated the compound. As the reacquisition of these three lots by private
February 28, 1994 were affirmed. THESAD respondent would leave the remaining four lots on the
SYLLABUS northwestern side without access to Tandang Sora Avenue,
REMEDIAL LAW; CIVIL PROCEDURE; PROVISIONAL petitioner acceded to private respondent's request on the
REMEDIES; PRELIMINARY MANDATORY INJUNCTION; condition that petitioner be given a right of way on the
JUSTIFICATION FOR THE ISSUANCE THEREOF; THE PARTY existing private road which forms part of the area to be
SEEKING THE ISSUANCE OF WRIT OF PRELIMINARY redeemed by private respondent. The parties' agreement was
MANDATORY INJUNCTION MUST HAVE A CLEAR AND embodied in a Memorandum of Undertaking, dated September
UNMISTAKABLE RIGHT. As held in Pelejo v. Court of 18, 1987, the full text of which reads: 6
Appeals (117 SCRA 665 [1982]), to justify the issuance of the writ MEMORANDUM OF UNDERTAKING
of preliminary mandatory injunction the following must be shown: KNOW ALL MEN THESE PRESENTS:
(1) that the complainant has a clear legal right; (2) that his right That METROPOLITAN FABRICS, INC. is the registered owner of
has been violated and the invasion is material and substantial; and that certain land covered by Transfer Certificate of Title No.
(3) that there is an urgent and permanent necessity for the writ to 317709, more particularly described as follows:
prevent serious damage. The right of the complainant must be A parcel of land (Lot 11 (Existing Road) of the consolidation-
clear and unmistakable because, unlike an ordinary preliminary subdn. plan (LRC) Pcs-27706, approved as a non-subdn. project,
injunction, the writ of preliminary mandatory injunction requires the being a portion of the consolidation of Lots 373-E, (LRC) Psd-
performance of a particular act or acts and thus tends to do more 16383; 377-B, Fls-2163-D; 377-C-1, 2, 3, & 4 (LRC) Psd-5025;
than maintain the status quo. In the case at bar, petitioner anchors 377-C-5-A, & B, (LRC) Psd-9474; 384-A & 387-B-1, (LRC) Psd-
its alleged right to the preliminary mandatory injunction on the 254813; 388-A & C, Psd-30663; 388-B-1, 2, 3, 4 & 5, Psd-54827;
Memorandum of Undertaking, dated September 18, 1987, which 389-A-1, 2 & 3, 389-B-1 (LRC) Psd-10087; and 389-B-2-C, (LRC)
provides that: [T]he above-described lot, being an existing private Psd-18842; LRC (GLRO) Rec. No. 5975) situated in the Bo. of
road, will remain open to ingress and egress for whatever kind of Banlat, Quezon City, Metro Manila, Is. of Luzon . . . containing of
passage in favor of PROSPERITY FINANCIAL RESOURCES, an area of FIVE THOUSAND THREE HUNDRED SIXTY SEVEN
INC. or its successors-in-interest. There is no question as to the (5,367) SQUARE METERS, more or less.
meaning of the terms "ingress" and "egress." They give petitioner That the above-described lot, being an existing private road,
the right to use the private road as a means of entry into and exit will remain open to ingress and egress for whatever kind of
from its property on the northwestern side of the compound. The passage in favor of PROSPERITY FINANCIAL RESOURCES,
question concerns the meaning of the phrase "for whatever kind INC. or its successors-in-interest, the mortgagee of Lots 1, 4, 5,
of passage." The trial court read this phrase to mean that petitioner 6, 7, 8 and 9 of the consolidation-subdivision plan, Pcs-27706 of
had the right to make excavations on the side of the access road Transfer Certificates of Title Nos. 317699, 317702, 317703,
in order to install a network of water pipes. The word "passage" 317704, 317705, 317706 & 317707, respectively, in the name of
does not, however, "clearly and unmistakably" convey a meaning METROPOLITAN FABRICS, INC.
that includes a right to install water pipes on the access road. The DONE this Sep. 18, 1987 in the city of Manila.
ordinary meaning of the word, as defined in Webster's Dictionary,
is that it is "the act or action of passing: movement or transference On November 7, 1991, petitioner filed an injunctive suit in the
from one place or point to another." Its legal meaning is not Regional Trial Court of Quezon City (Branch 95). Petitioner alleged
different. It means, according to Black's Law Dictionary, the "act of that, in violation of the terms of the Memorandum of Agreement,
passing; transit; transition." To achieve a meaning such as that private respondent refused to allow petitioner to make
which petitioner proposes requires the consideration of evidence excavations on one side of the access road for the installation
of water pipes; that it banned entry of petitioner's trucks and 2. THE COURT OF APPEALS GROSSLY ERRED WHEN IT
those of its tenants between 11:30 A.M. to 1:00 P.M. and 10:00 APPLIED THE DOCTRINE ENUNCIATED IN RIVAS V. SEC (190
P.M. to 7:00 A.M.; and that it subjected the vehicles to SCRA 295) DESPITE THE DIVERSITY IN FACTUAL SETTING
unnecessary searches. Petitioner sought the issuance of a writ OF THE INSTANT CASE VIS-A-VIS THAT OBTAINING IN THE
of preliminary mandatory injunction requiring private respondent CITED CASE. LLjur
"to allow [petitioner] to proceed with the MWSS installation project 3. THE COURT OF APPEALS GRAVELY ERRED WHEN IT
over the road lot in question, to allow [petitioner's] and [its] tenants' DECIDED THE MERITS OF THE MAIN CASE IN
delivery trucks and other vehicles access to the same at any time A CERTIORARI PROCEEDING PRACTICALLY RENDERING
and without undergoing unnecessary searches, and to otherwise ACADEMIC THE HEARING PROPER YET TO BE CONDUCTED
recognize [petitioner's] right of way over the said lot." 7 Petitioner BY THE REGIONAL TRIAL COURT.
prayed that, after trial, the writ be made final. 4. THE COURT OF APPEALS GRAVELY ERRED WHEN IT
MADE FINDINGS OF FACTS ON THE BASIS OF THE
On December 21, 1991, private respondent filed an answer with REPRESENTATION AND RECITAL OF FACTS MADE IN THE
counterclaim, alleging that petitioner's right to undertake MFI PETITION AND PROCEEDED TO INTERPRET THE
excavations on the access road was not provided for in the MEMORANDUM OF UNDERTAKING WITHOUT CONSIDERING
Memorandum of Undertaking. 8 As counterclaim, private FACTS AND CIRCUMSTANCES SURROUNDING ITS
respondent alleged that it was petitioner which caused damage to EXECUTION WHICH WERE YET TO BE ESTABLISHED IN A
private respondent's tenants by undertaking, without its consent, FULL BLOWN TRIAL.
construction works on the access road which raised its level to
about a meter and caused serious flooding of the nearby buildings ISSUE:
whenever it rained; 9 and that, as a result, its tenants demanded The assignment of errors raises a single question: whether, in
compensation for damage to their merchandise and equipment issuing a writ of preliminary mandatory injunction ordering private
occasioned by the flooding. Private respondent prayed for P2.1 respondent to allow petitioner to undertake excavations along the
million as counterclaim. 10 access road for the purpose of installing water pipes, the Regional
Trial Court gravely abused its discretion.
The trial court required the parties to submit position papers in
connection with petitioner's prayer for a preliminary mandatory HELD:
injunction. 11 After the parties had done so, the trial court granted, As held in Pelejo v. Court of Appeals, 18 to justify the issuance of
on February 14, 1992, petitioner's prayer for a preliminary writ, the writ of preliminary mandatory injunction the following must be
conditioned upon the filing by petitioner of a bond in the amount of shown: (1) that the complainant has a clear legal right; (2) that his
P500,000.00. The trial court said in part: right has been violated and the invasion is material and
. . . [T]he court finds that to deny plaintiff's application for a substantial; and (3) that there is an urgent and permanent
preliminary mandatory injunction writ would be to disregard its right necessity for the writ to prevent serious damage.
of way in respect of the road lot in question, a right clearly set forth The right of the complainant must be clear and unmistakable
in defendant's memorandum of undertaking of September 18, because, unlike an ordinary preliminary injunction, the writ of
1987; indeed, no cogent reason appears to warrant treating the preliminary mandatory injunction requires the performance of a
terms "for whatever kind of passage" contained therein as nothing particular act or acts 19 and thus tends to do more than maintain
more than a useless, meaningless redundancy . . . the status quo. 20 In the case at bar, petitioner anchors its alleged
ACCORDINGLY, plaintiff's subject application is hereby granted right to the preliminary mandatory injunction on the Memorandum
and the Court hereby directs that upon the filing and approval of of Undertaking, dated September 18, 1987, which provides that:
the corresponding injunction bond in the sum of P500,000.00, . . . [T]he above-described lot, being an existing private road, will
let corresponding preliminary mandatory injunction writ be issued remain open to ingress and egress for whatever kind of passage
directing defendant to allow plaintiff to proceed with its MWSS in favor of PROSPERITY FINANCIAL RESOURCES, INC. or its
installation project over the road lot in question, to allow plaintiff's successors-in-interest.
and its tenant's delivery trucks and other vehicles access to the There is no question as to the meaning of the terms "ingress" and
same at any time and without undergoing unnecessary searches, "egress." They give petitioner the right to use the private road as
and to otherwise recognize plaintiff's right of way over the said a means of entry into and exit from its property on the northwestern
road lot, pending the termination of this litigation and/or unless a side of the compound. The question concerns the meaning of the
contrary order is issued by this Court . . . 12 phrase "for whatever kind of passage." The trial court read this
On March 2, 1992, the trial court issued the writ upon filing of the phrase to mean that petitioner had the right to make excavations
required bond by petitioner. 13 Private respondent filed a motion on the side of the access road in order to install a network of water
for reconsideration of the orders granting injunction which the trial pipes. The word "passage" does not, however, "clearly and
court denied. 14 However, it increased the injunction bond to P2.1 unmistakably" convey a meaning that includes a right to install
million. 15 water pipes on the access road. The ordinary meaning of the word,
Private respondent filed a petition for certiorari and prohibition with as defined in Webster's Dictionary, is that it is "the act or action of
the Court of Appeals to annul the aforesaid orders, dated February passing: movement or transference from one place or point to
14, 1992 and March 2, 1992, of the trial court. On November 26, another." 21 Its legal meaning is not different. It means, according
1994, the appellate court granted the petition and set aside the to Black's Law Dictionary, the "act of passing; transit;
questioned orders after finding that the trial court had acted with transition." 22 To achieve a meaning such as that which petitioner
grave abuse of discretion in issuing them. 16 Its motion for proposes requires the consideration of evidence showing the
reconsideration having been denied on February 28, 1994, parties' intention in using the word which can only be done during
petitioner filed the present petition for review on certiorari alleging trial on the merits. Until such time, petitioner cannot claim to have
that: 17 a "clear and unmistakable" right justifying the issuance of a writ of
1. THE COURT OF APPEALS GRAVELY ERRED WHEN IT preliminary mandatory injunction in this case. Thus, the trial court
EXERCISED CERTIORARI POWERS TO REVERSE AN ERROR should have observed caution and denied petitioner's application
OF JUDGMENT COMMITTED BY THE REGIONAL TRIAL for the preliminary writ.
COURT, UPON FINDING THAT THE LOWER COURT Petitioner contends that resort should be made to facts
"MISUNDERSTOOD" THE RIGHT OF HEREIN PETITIONER surrounding the execution of the Memorandum of Undertaking
PROSPERITY OVER THE ROAD LOT IN QUESTION. which, according to it, shows the intention of the parties to give
petitioner the right to install water pipes along the side of the mandated by law, constituted for public use or for private interest,
access road. 23 It cites Rule 130 11 24 of the 1964 Rules of and becomes a continuing property right. As a compulsory
Court, which provides: easement, it is inseparable from the estate to which it belongs, as
SEC. 11. Interpretation according to circumstances. For the provided for in said Article 617 of the Civil Code. The essential
proper construction of an instrument, the circumstances under requisites for an easement to be compulsory are: (1) the dominant
which it was made, including the situation of the subject thereof estate is surrounded by other immovables and has no adequate
and of the parties to it, may be shown, so that the judge may be outlet to a public highway; (2) proper indemnity has been paid; (3)
placed in the position of those whose language he is to interpret. the isolation was not due to acts of the proprietor of the dominant
That is precisely what we are saying. The recourse petitioner estate; (4) the right of way claimed is at a point least prejudicial to
proposes must await the presentation of the parties' evidence the servient estate; and (5) to the extent consistent with the
during trial and the determination of their intention must be made foregoing rule, where the distance from the dominant estate to a
by the trial court, not by this Court. Petitioner cannot circumvent public highway may be the shortest.
the process by asking this Court to determine the facts 2. ID.; ID.; ID.; THE NEEDS OF THE DOMINANT ESTATE
surrounding the execution of their agreement. Indeed, for us to DETERMINE THE WIDTH OF THE EASEMENT. [T]he small
undertake such inquiry would be to expand the scope of the house occupying one meter of the two-meter wide easement
present review and intrude into the domain of the trial court. obstructs the entry of private respondents' cement mixer and
Petitioner will have ample opportunity to substantiate its motor vehicle. One meter is insufficient for the needs of private
allegations on this point during the trial of the case. Rule 130 11, respondents. It is well-settled that the needs of the dominant
which petitioner invokes, is actually a rule for interpretation of estate determine the width of the easement. Conformably then,
documentary evidence formally offered at the trial. It does not petitioner ought to demolish whatever edifice obstructs the
apply to preliminary proceedings concerning the issuance of easement in view of the needs of private respondents' estate.
ancillary remedies. 3. ID.; ID.; ID.; LEGAL EASEMENT BINDING EVEN IF NOT
Anent petitioner's contention that the writ of certiorari does not lie ANNOTATED IN THE TITLE AND NOTICE OF LIS PENDENS OF
because the error sought to be corrected is an error of judgment, CASE ENFORCING THE SAME NOT RECORDED.
suffice it to say that the lower court acted with grave abuse of Petitioner's second proposition, that he is not bound by the
discretion in issuing the writ of preliminary mandatory injunction contract of easement because the same was not annotated in the
despite the doubt on petitioner's right to it. title and that a notice of lis pendens of the complaint to enforce the
WHEREFORE, the decision of the Court of Appeals, dated easement was not recorded with the Register of Deeds, is
November 26, 1993, and its resolution, dated February 28, 1994, obviously unmeritorious . . . it is in the nature of legal easement
are hereby AFFIRMED. cdasia that the servient estate (of petitioner) is legally bound to provide
SO ORDERED. the dominant estate (of private respondents in this case) ingress
||| (Prosperity Credit Resources, Inc. v. Court of Appeals, G.R. No. from and egress to the public highway.
114170, [January 15, 1999], 361 PHIL 30-39) 4. REMEDIAL LAW; CIVIL PROCEDURE; EFFECT OF
JUDGMENTS; DECISION IN A CASE BINDING TO THE
Villanueva v. Velasco 346 SCRA 99 PARTIES AND SUCCESSOR-IN-INTEREST AFTER CASE
SECOND DIVISION COMMENCED. Petitioner's last argument that he was not a
[G.R. No. 130845. November 27, 2000.] party to Civil Case No. Q-91-8703 and that he had not been given
BRYAN U. VILLANUEVA, petitioner, vs. HON. TIRSO D.C. his day: in court, is also without merit [in view of] Rule 39, Sec. 47,
VELASCO in his capacity as Presiding Judge of the Regional of the Revised Rules of Court. . . . [A] decision in a case is
Trial Court of Quezon City, Branch 88, JULIO N. SEBASTIAN conclusive and binding upon the parties to said case and those
and SHIRLEY LORILLA, respondents. who are their successor in interest by title after said case has been
The Law Firm of Chan Robles & Associates for petitioner. commenced or filed in court. In this case, private respondents. . .
Pedro I. Rodriguez for private respondents. initiated; Civil Case No. Q-91-8703 on May 8,1991, against the
SYNOPSIS original owners. . . . Title in the name of petitioner was entered in
Petitioner Villanueva is the registered owner of a parcel of land the Register of Deeds on March 24, 1995, after he bought the
previously owned by spouses Gabriel. When Villanueva bought property from the bank which had acquired it from the Gabriels.
the land, there was a small house on the southeastern portion, Hence, the decision in Civil Case No. Q-91-8703 binds petitioner.
occupying one meter of the two-meter wide easement of right of For, although not a party to the suit, he is a successor-in-interest
way the Gabriel spouses granted to the Espinolas, predecessors- by title subsequent to the commencement of the action in court.
in-interest of private respondent. Unknown to Villanueva, even DECISION
before he bought the land, there was already a final and executory QUISUMBING, J p:
decision enforcing the right to easement where the small house This petition for certiorari assails (1) the decision 1 dated
encroaching the same was ordered demolished by Judge December 27, 1996 of the Court of Appeals in CA-G.R. SP No.
Velasco. 39166, dismissing petitioner's petition for review under Rule 65
The easement in the case at bar is both voluntary and legal with prayer for the issuance of a cease and desist order and/or
easement. The settled rule is that the needs of the dominant estate temporary restraining order, and (2) the resolution 2 dated August
determine the width of the easement. Hence, petitioner ought to 14, 1997 denying the subsequent motion for reconsideration.
demolish the small house on the easement obstructing the entry
of private respondents' cement mixer and motor vehicle. And even Petitioner Bryan Villanueva is the registered owner of the parcel of
if the easement was not annotated in the title of the land and the land covered by Transfer Certificate of Title No. 127862 of the
notice of lis pendens was not recorded with the Register of Deeds, Register of Deeds of Quezon City. He bought it from Pacific
in legal easement, the servient estate is bound to provide the Banking Corporation, the mortgagee of said property. The bank
dominant estate ingress from and egress to the public highway. had acquired it from the spouses Maximo and Justina Gabriel at a
Further, the decision enforcing the right of easement against the public auction on March 19, 1983. When petitioner bought the
previous owner, is conclusive and binding upon the successor-in- parcel of land there was a small house on its southeastern portion.
interest. It occupied one meter of the two-meter wide easement of right
SYLLABUS of way the Gabriel spouses granted to the Espinolas,
1. CIVIL LAW; PROPERTY; EASEMENTS; KINDS; LEGAL predecessors-in-interest of private respondents, in a
EASEMENT; ELUCIDATED. [A] legal easement is one
Contract of Easement of Right of Way. The pertinent portion of No costs considering the failure of private respondents to file their
the contract dated November 28, 1979, states: comment, despite notice. 8
. . . in order to have an access to and from their aforementioned Hence, this instant petition.
land where their houses are constructed and to have an outlet to
Tandang Sora Ave. which is the nearest public road and the least Petitioner now avers that the appellate court erred in declaring,
burdensome to the servient estate and to third persons, it would (1) THAT FOLLOWING THE ESSENCE OF INHERENCE AND
be necessary for them to pass through spouses MAXIMO INTRANSMISSIBILITY OF AN EASEMENT, A RIGHT OF WAY
GABRIEL and JUSTINA CAPUNO's land and for this purpose, a CAN EXIST EVEN IF THEY ARE NOT EXPRESSLY STATED OR
path or passageway of not less than two (2) meters wide of said ANNOTATED ON THE TORRENS TITLE;
spouses' property is necessary for the use of ROMEO,
RODOLFO, NENITA and AURORA ESPINOLA and for all their (2) THAT PETITIONER, AS PROSPECTIVE BUYER, SHOULD
needs in entering their property. HAVE EXERCISED ORDINARY PRUDENCE BY TAKING THE
xxx xxx xxx INITIATIVE TO DETERMINE THAT AN EASEMENT HAS BEEN
WHEREFORE, in view of the fact that the property of the CONSTITUTED ON THE PROPERTY HE INTENDS TO BUY;
ESPINOLA had been bought by them from MAXIMO CAPUNO, AND,
father of MAXIMO GABRIEL, spouses MAXIMO GABRIEL and (3) THAT IN AS MUCH AS THE HEREIN PETITIONER IS NOT A
JUSTINA CAPUNO hereby agree and permit RODOLFO, PARTY TO CIVIL CASE NO. Q-91-8703, HE CANNOT BE
ROMEO, NENITA and AURORA ESPINOLA and their families to BOUND BY ANY JUDGMENT OR ORDER RENDERED
have a permanent easement of right of way over the THEREIN. 9
aforementioned property of said spouses limited to not more than
two meters wide, throughout the whole length of the southeast side Primarily, the issue is whether the easement on the property binds
of said property and as specifically indicated in the attached plan petitioner.
which is made an integral part of this Contract as Annex "A";
This Agreement shall be binding between the parties and upon Petitioner argues it could not be enforced against him. First, he
their heirs, successors, assigns, without prejudice in cases of sale says that a right of way cannot exist when it is not expressly stated
of subject property that will warrant the circumstances. 3 or annotated on the Torrens title. According to him, even if an
easement is inherent and inseparable from the estate to which it
Unknown to petitioner, even before he bought the land, the actively belongs as provided in Art. 617 of the Civil Code, 10 the
Gabriels had constructed the aforementioned small house that same is extinguished when the servient estate is registered and
encroached upon the two-meter easement. Petitioner was also the easement was not annotated in said title conformably
unaware that private respondents, Julio Sebastian and Shirley with Section 39 of the Land Registration Law. Second, petitioner
Lorilla, had filed on May 8, 1991, Civil Case No. Q-91-8703, for points out that the trial court erred when it faulted him for relying
easement, damages and with prayer for a writ of preliminary solely on the clean title of the property he bought, as it is well-
injunction and/or restraining order against the spouses settled that a person dealing with registered land is not required to
Gabriel. 4 As successors-in-interest, Sebastian and Lorilla wanted go beyond what is recorded in the title. He adds that it is private
to enforce the contract of easement. respondents who should have made sure their right of way was
safeguarded by having the same annotated on the title with the
On May 15, 1991, the trial court issued a temporary restraining Register of Deeds. He adds that Section 76 of P.D. No.
order. On August 13, 1991, it issued a writ of preliminary 1529 11 also requires that when a case is commenced involving
mandatory injunction ordering the Gabriels to provide the right of any right to registered land under the Land Registration Law (now
way and to demolish the small house encroaching on the the Property Registration Decree), any decision on it will only be
easement. On August 15, 1991, the Gabriels filed a motion for effectual between or among the parties thereto, unless a notice
reconsideration which was also denied. Thus, they filed a petition of lis pendens of such action is filed and registered in the registry
for certiorari before the Court of Appeals. office where the land is recorded. There was no such annotation
On March 26, 1992, the Eighth Division of the Court of Appeals in the title of the disputed land, according to
dismissed the petition and upheld the RTC's issuances. The petitioner. Lastly, since he was not a party to Civil Case No. Q-91-
decision became final and executory on July 31, 1992. 5 8703, petitioner argues that he cannot be bound by the writ of
On January 5, 1995, Judge Tirso Velasco of the RTC in Quezon demolition and be forcibly divested of a portion of his land without
City, Branch 88, issued an Alias Writ of Demolition. On June 20, having his day in court.
1995, the sheriff tried to demolish the small house pursuant to the
writ. Petitioner filed a Third Party Claim with Prayer to Private respondents Sebastian and Lorilla, for their part, adopted
Quash Alias Writ of Demolition. He maintains that the writ of the disquisition of the appellate court as their Comment and asked
demolition could not apply to his property since he was not a party for the dismissal of the petition and P100,000.00 in damages. In
to the civil case. His Third Party Claim with prayer to quash the its decision the appellate court, citing the decision of the lower
writ of demolition was denied for lack of merit on August 16, court, stressed that unlike other types of encumbrance of real
1995. 6 The motion for reconsideration as well as the property, a servitude like a right of way can exist even if they are
Supplemental Motion for Reconsideration dated September 12, not expressly stated or annotated as an encumbrance in
1995 were denied on October 19, 1995. 7 a Torrens title because servitudes are inseparable from the
Petitioner, thereafter, filed a petition for certiorari before the Court estates to which they actively or passively belong. Moreover,
of Appeals, docketed as CA-G.R. SP No. 39166, asserting that the Villanueva was bound by the contract of easement, not only as a
existence of the easement of right of way was not annotated in his voluntary easement but as a legal easement. A legal easement is
title and that he was not a party to Civil Case No. Q-91-8703, mandated by law, and continues to exists unless its removal is
hence the contract of easement executed by the Gabriels in favor provided for in a title of conveyance or the sign of the easement is
of the Espinolas could not be enforced against him. The Court of removed before the execution of the conveyance conformably
Appeals dismissed the petition for lack of merit and denied the with Article 649 12 in accordance with Article 617 13 of the Civil
reconsideration, disposing thus: Code.
WHEREFORE, the instant petition is hereby dismissed by this
court for lack of merit. At the outset, we note that the subject easement (right of way)
originally was voluntarily constituted by agreement between the
Gabriels and the Espinolas. But as correctly observed by the Shirley Lorilla, initiated Civil Case No. Q-91-8703 on May 8,
Court of Appeals, the easement in the instant petition is both 1991, 19 against the original owners, the spouses Maximo and
(1) an easement by grant or a voluntary easement, and (2) an Justina Gabriel. Title in the name of petitioner was entered in the
easement by necessity or a legal easement. A legal easement Register of Deeds 20 on March 24, 1995, after he bought the
is one mandated by law, constituted for public use or for private property from the bank which had acquired it from the Gabriels.
interest, and becomes a continuing property right. 14 As a Hence, the decision in Civil Case No. Q-91-8703 binds petitioner.
compulsory easement, it is inseparable from the estate to which it For, although not a party to the suit, he is a successor-in-interest
belongs, as provided for in said Article 617 of the Civil Code. The by title subsequent to the commencement of the action in court.
essential requisites for an easement to be compulsory are: (1) the WHEREFORE, the instant petition is DENIED. The assailed
dominant estate is surrounded by other immovables and has no decision and resolution of the Court of Appeals are AFFIRMED.
adequate outlet to a public highway; (2) proper indemnity has been Costs against petitioner.
paid; (3) the isolation was not due to acts of the proprietor of the SO ORDERED.
dominant estate; (4) the right of way claimed is at a point least ||| (Villanueva v. Velasco, G.R. No. 130845, [November 27, 2000],
prejudicial to the servient estate; and (5) to the extent consistent 399 PHIL 664-674)
with the foregoing rule, where the distance from the dominant
estate to a public highway may be the shortest. 15 The trial court National Irrigation Administration v. Court of Appeals 440 SCRA
and the Court of Appeals have declared the existence of said 661
easement (right of way). This finding of fact of both courts below FIRST DIVISION
is conclusive on this Court, 16 hence we see no need to further [G.R. No. 114348. September 20, 2000.]
review, but only to re-affirm, this finding. The small house NATIONAL IRRIGATION ADMINISTRATION, petitioner, vs. CO
occupying one meter of the two-meter wide easement obstructs URT OF APPEALS and DICK MANGLAPUS, respondents.
the entry of private respondents' cement mixer and motor vehicle. The Solicitor General for petitioner.
One meter is insufficient for the needs of private respondents. It is Atty. Simeon T. Agustin for private respondent.
well-settled that the needs of the dominant estate determine the SYNOPSIS
width of the easement. 17 Conformably then, petitioner ought to A free patent over three (3) hectares of land, situated in barrio
demolish whatever edifice obstructs the easement in view of the Baybayog, Municipality of Alcala, Province of Cagayan, was
needs of private respondents' estate. issued in the name of respondent's predecessor-in-interest
Vicente Manglapus. The land grant provided, among others, a
Petitioner's second proposition, that he is not bound by the condition that the land shall be subject to all conditions and public
contract of easement because the same was not annotated in the easements and servitudes recognized and prescribed by law
title and that a notice of lis pendens of the complaint to enforce the especially those mentioned in Sections 109, 110, 111, 112, 113
easement was not recorded with the Register of Deeds, is and 114 of Commonwealth Act No. 141, as amended.
obviously unmeritorious. As already explained, it is in the nature of Subsequently, respondent Manglapus acquired the lot from
legal easement that the servient estate (of petitioner) is legally Vicente Manglapus by absolute sale. Sometime in 1982, the NIA
bound to provide the dominant estate (of private respondents in entered into a contract with Villamar Development Construction.
this case) ingress from and egress to the public highway. Under the contract, the NIA was to construct canals in Amulung,
Cagayan and Alcala, Cagayan. The NIA then entered a
Petitioner's last argument that he was not a party to Civil Case No. portion of Manglapus' land and made diggings and fillings thereon.
Q-91-8703 and that he had not been given his day in court, is also Manglapus filed with the Regional Trial Court, Tuguegarao,
without merit. Rule 39, Sec. 47, of the Revised Rules of Court: Cagayan a complaint for damages against the NIA. Manglapus
SECTION 47. Effect of judgments or final orders. The effect of alleged that the NIA's diggings and fillings destroyed the
a judgment or final order rendered by a court of the Philippines, agricultural use of his land and that no reasonable compensation
having jurisdiction to pronounce the judgment or final order, may was paid for its taking. The trial court rendered a decision in
be as follows: favor of Manglapus ordering the defendant to pay plaintiff the
(a) In case of a judgment or final order against a specific thing, or sum of One Hundred Fifty Thousand Six Hundred Pesos
in respect to the probate of a will, or the administration of the estate (P150,600.00) and Fifty Thousand (P50,000.00) Pesos as
of a deceased person, or in respect to the personal, political, or compensatory damages. On appeal,
legal condition or status of a particular person or his relationship the Court of Appealsaffirmed in toto the decision of the trial court.
to another, the judgment or final order is conclusive upon the title Hence, the present petition by the NIA.
to the thing, the will or administration, or the condition, status or The Supreme Court granted the petition and set aside the
relationship of the person; however, the probate of a will or decision of the trial court awarding Manglapus just compensation.
granting of letters of administration shall only be prima According to the Court, the Transfer Certificate of Title and the
facie evidence of the death of the testator or intestate; Original Certificate of Title covering the subject parcel of land
(b) In other cases, the judgment or final order is, with respect to contained a reservation granting the government a right ofway
the matter directly adjudged or as to any other matter that could over the land covered therein. The transfer certificate of title, on
have been raised in relation thereto, conclusive between the which both the trial court and Court of Appeals relied, contained
parties and their successors in interest by title subsequent to the such a reservation, and said reservation, unlike the
commencement of the action or special proceeding, litigating for other provisos imposed on the grant, was not limited by any time
the same thing and under the same title and in the same capacity; period and thus is a subsisting condition.
and SYLLABUS
(c) In any other litigation between the same parties or their 1. CIVIL LAW; PROPERTY; EASEMENT OF A RIGHT OF WAY;
successors-in-interest, that only is deemed to have been adjudged THE TRANSFER CERTIFICATE OF TITLE OF THE SUBJECT
in a former judgment or final order which appears upon its face to PARCEL OF LAND CONTAINED RESERVATION GRANTING
have been so adjudged, or which was actually and necessarily THE GOVERNMENT A RIGHT OF WAY OVER THE LAND
included therein or necessary thereto. (Italics supplied). COVERED THEREIN. We agree with NIA that the Transfer
Simply stated, a decision in a case is conclusive and binding upon Certificate of Title and the Original Certificate of Title covering the
the parties to said case and those who are their successor-in- subject parcel of land contained a reservation granting the
interest by title after said case has been commenced or filed in government a right of way over the land covered therein. The
court. 18 In this case, private respondents, Julio Sebastian and transfer certificate of title, on which both the
trial court and Court of Appeals relied, contains such a units, or institutions, the land hereby acquired shall be inalienable
reservation. It states that title to the land shall be: ". . . subject to and shall not be subject to encumbrance for a period of five (5)
the provisions of said Land Registration Act and the Public Land years from the date of this patent, and shall not be liable for the
Act, as well as those of Mining Laws, if the land is mineral, and satisfaction of any debt contracted prior to the expiration of that
subject, further to such conditions contained in the original title as period; that it shall not be encumbered, alienated, or transferred to
may be subsisting." Under the Original Certificate of Title, there any person, corporation, association or partnership not qualified to
was a reservation and condition that the land is subject to "to all acquire lands of the public domain under said Commonwealth Act
conditions and public easements and servitudes recognized and No. 141, as amended; and that it shall not be subject to any
prescribed by law especially those mentioned in Sections 109, encumbrance whatsoever in favor of any corporation, association
110, 111, 112, 113 and 114, Commonwealth Act No. 141, as or partnership except with the consent of the grantee and the
amended." This reservation, unlike the other provisos imposed on approval of the Secretary of Agriculture and Natural Resources
the grant, was not limited by any time period and thus is a and solely for educational, religious or charitable purposes or for a
subsisting condition. Section 112, Commonwealth Act No. 141, right of way; and subject finally to all conditions and public
provides that lands granted by patent, "shall further be subject to easements and servitudes recognized and prescribed by law
a right of way not exceeding twenty meters in width for public especially those mentioned in Sections 109, 110, 111, 112, 113
highways, railroads, irrigation ditches, aqueducts, telegraphs and and 114 of Commonwealth Act No. 141 as amended, and the
telephone lines, and similar works as the Government or any right of the Government to administer and protect the timber found
public or quasi-public service or enterprises, including mining or thereon for a term of five (5) years from the date of this patent,
forest concessionaires may reasonably require for carrying on provided, however, that the grantee or heirs may cut and utilize
their business, with damages for the improvements only." We note such timber for his or their personal use (emphasis ours)."
that the canal NIA constructed was only eleven (11) meters in
width. This is well within the limit provided by law. Manglapus has Subsequently, respondent Manglapus acquired the lot from
therefore no cause to complain. TAIEcS Vicente Manglapus by absolute sale.
2. ID.; ID.; ID.; LEGAL EASEMENT OF RIGHT OF WAY EXISTS On July 18, 1974, the land was registered in Dick Manglapus'
IN FAVOR OF THE GOVERNMENT IN CASE AT BAR. Article name under Transfer Certificate of Title No. T-26658 of the
619 of the Civil Code provides that, "Easements are established Register of Deeds for the Province of Cagayan. 6 The land is
either by law or by the will of the owners. The former are called particularly described as follows: 7
legal and the latter voluntary easements." In the present case, we "Lot No. 3559, Pls-497, with an area of 30,438 square meters, and
find and declare that a legal easement of a right-of-way exists in covered by TRANSFER CERTIFICATE OF TITLE NO. T-26658,
favor of the government. The land was originally public land, and and Tax Declaration No. 11985."
awarded to respondent Manglapus by free patent. The ruling
would be otherwise if the land were originally private property, in Sometime in 1982, NIA entered into a contract with Villamar
which case, just compensation must be paid for the taking of a part Development Construction. Under the contract, NIA was to
thereof for public use as an easement of a right of way. Neither construct canals in Amulung, Cagayan and Alcala, Cagayan. NIA
can Manglapus argue that he was a transferee or buyer in good then entered a portion of Manglapus' land and made diggings and
faith. Under the Torrens system, for one to be a buyer in good faith fillings thereon. 8
and for value, the vendee must see the transfer certificate of title The portion of Manglapus' land entered into by NIA is described
and rely upon the same. Here, the annotation on the transfer as follows: 9
certificate of title imposed on Manglapus the duty to refer to the "In a sketch prepared by NIA's employee labeled as NIA canal
conditions annotated on the back of the original certificate of title. "Lateral "D", with an area of 7,880 square meters, which is a
This, he did not do. The law cannot protect him. Manglapus is a portion of Lot 3559, Pls-497."
transferee with notice of the liens annotated in the title.
DECISION On March 14, 1991, Manglapus filed with the Regional Trial Court,
PARDO, J p: Tuguegarao, Cagayan a complaint for damages against
This case is an appeal 1 from the NIA. 10 Manglapus alleged that NIA's diggings and fillings
decision of the Court of Appeals 2 affirming in toto the destroyed the agricultural use of his land and that no reasonable
decision of the Regional Trial Court, Branch 04, Tuguegarao, compensation was paid for its taking. 11
Cagayan 3ruling in favor of private respondent Dick Manglapus Despite service of notice of the pre-trial conference, 12 NIA did
(hereinafter referred to as "Manglapus"), and ordering not appear at the pre-trial conference. 13
petitioner National Irrigation Administration(hereinafter referred to On December 3, 1991, the trial court declared NIA in default and
as "NIA") to pay Manglapus one hundred fifty thousand six received Manglapus' evidence ex parte. 14
hundred pesos (P150,600.00), and fifty thousand pesos On December 23, 1991, the trial court rendered a decision in
(P50,000.00), as compensatory damages, five thousand pesos favor of Manglapus, thus: 15
(P5,000.00), as attorney's fees, and two thousand pesos "WHEREFORE, and in consideration of the foregoing,
(P2,000.00), as litigation expenses and costs. the Court finds preponderance of evidence in favor of the plaintiff
FACTS: and against the defendant:
On June 28, 1963, a free patent over three (3) hectares of land,
situated in barrio Baybayog, municipality of Alcala, "1) Ordering the defendant to pay plaintiff the sum of One Hundred
province of Cagayan was issued in the name of respondent's Fifty Thousand Six Hundred Pesos (P150,600.00) and Fifty
predecessor-in-interest, Vicente Manglapus, and registered under Thousand (P50,000.00) Pesos as compensatory damages;
Original Certificate of Title No. P-24814, in his name. The land was "2) Ordering the defendant to pay to plaintiff the sum of Five
granted to Vicente Manglapus, 4 subject to the Thousand Pesos (P5,000.00) as attorney's fees and Two
following proviso expressly stated in the title: 5 Thousand Pesos (P2,000.00) as litigation expenses; and
"TO HAVE AND TO HOLD the said tract of land, with the "3) To pay the cost of the suit.
appurtenances thereunto of right belonging unto the said "SO ORDERED."
VICENTE MANGLAPUS and to his heirs and assigns forever,
subject to the provisions of Sections 113, 121, 122 and On January 27, 1992, NIA filed a motion to lift the order of default
124 of Commonwealth Act. No. 141, as amended which provide dated December 3, 1991, and to set aside the afore-quoted
that except in favor of the Government or any of its branches, decision of December 23, 1991. 16
On June 3, 1992, the trial court issued a resolution denying the property, in which case, just compensation must be paid for the
motion for lack of merit. 17 taking of a part thereof for public use as an easement of a
On July 17, 1992, NIA filed a notice of appeal to right of way. 32
the Court of Appeals. 18
On July 27, 1992, the trial court gave due course to the appeal and Neither can Manglapus argue that he was a transferee or buyer in
ordered the transmission of the original records to good faith. Under the Torrens system, for one to be a buyer in good
the Court of Appeals. 19 faith and for value, the vendee must see the transfer
On July 30, 1992, Manglapus filed a motion for certificate of title and rely upon the same. 33 Here, the annotation
execution of judgment with the trial court. 20 on the transfer certificate of title imposed on Manglapus the duty
On August 7, 1992, the NIA through the Solicitor General filed an to refer to the conditions annotated on the back of the original
opposition to the motion for execution. 21 certificate of title. This, he did not do. The law cannot protect him.
On August 17, 1992, the trial court declared that since the Manglapus is a transferee with notice of the liens annotated in the
notice of appeal of NIA was given due course, the motion for title.
execution was "moot and academic." 22 One who deals with property registered under the Torrens system
On March 8, 1994, the Court of Appeals promulgated its decision, is charged with notice of burdens and claims that are annotated on
the dispositive portion of which reads: 23 the title. 34
"WHEREFORE, PREMISES CONSIDERED, the decision WHEREFORE, the Court GRANTS the petition for review
appealed from is hereby AFFIRMED in toto and the appeal is on certiorari, and REVERSES the
hereby DISMISSED. decision of the Court of Appeals in CA-G.R. CV No. 38835.
"SO ORDERED." IN LIEU THEREOF, the Court SETS ASIDE the decision of the
Hence, this appeal. 24 Regional Trial Court, Branch IV, Tuguegarao, Cagayan in Civil
Case No. 4266, and DISMISSES the complaint.
ISSUE: No costs.
The sole issue is whether the NIA should pay Manglapus just SO ORDERED.
compensation for the taking of a portion of his property for use as ||| (National Irrigation Administration v. Court of Appeals, G.R. No.
easement of a right of way. 114348, [September 20, 2000], 395 PHIL 48-57)
HELD:
We find that NIA is under no such obligation. We sustain the Title 8 Nuisance (Arts. 694-707)
appeal.
We agree with NIA that the Transfer Certificate of Title 25 and the CASE:
Original Certificate of Title 26 covering the subject parcel of land Hidalgo Enterprises, Inc. v. Balandan 91 Phil.
contained a reservation granting the government a right of way
over the land covered therein. 27 EN BANC
The transfer certificate of title, on which both the [G.R. No. L-3422. June 13, 1952.]
trial court and Court of Appeals relied, contains such a HIDALGO ENTERPRISES, INC., petitioner, vs.
reservation. It states that title to the land shall be: 28 GUILLERMO BALANDAN, ANSELMA ANILA and THE COURT
". . . subject to the provisions of said Land Registration Act and the OF APPEALS, respondents.
Public Land Act, as well as those of Mining Laws, if the land is Quisumbing, Sycip, Quisumbing & Salazar for petitioner.
mineral, and subject, further to such conditions contained in the Antonio M. Moncado for respondents.
original title as may be subsisting (emphasis ours)." SYLLABUS
Under the Original Certificate of Title, 29 there was a reservation 1. ATTRACTIVE NUISANCE, WHAT CONSTITUTES;
and condition that the land is subject to "to all conditions and public MAINTAINER LIABLE FOR INJURIES CAUSED TO CHILD.
easements and servitudes recognized and prescribed by law One who maintains on his premises dangerous instrumentalities
especially those mentioned in Sections 109, 110, 111, 112, 113 or appliances of a character likely to attract children in play, and
and 114, Commonwealth Act No. 141, as amended." This who fails to exercise ordinary care to prevent children from playing
reservation, unlike the other provisos 30 imposed on the grant, therewith or resorting thereto, is liable to a child of tender years
was not limited by any time period and thus is a subsisting who is injured thereby, even if the child is technically a trespasser
condition. in the premises.
Section 112, Commonwealth Act No. 141, provides that lands 2. ID.; DOCTRINE NOT APPLICABLE TO SWIMMING POOL OR
granted by patent, WATER TANK. The attractive nuisance doctrine generally is not
"shall further be subject to a right of way not exceeding twenty applicable to bodies of water, artificial as well as natural, in the
meters in width for public highways, absence of some unusual condition or artificial feature other than
railroads, irrigation ditches, aqueducts, telegraphs and telephone the mere water and its location.
lines, and similar works as the Government or any public or quasi- DECISION
public service or enterprises, including mining or forest BENGZON, J p:
concessionaires may reasonably require for carrying on their This is an appeal by certiorari, from a decision of the Court of
business, with damages for the improvements only (emphasis Appeals requiring Hidalgo Enterprises, Inc. to pay
ours)." Guillermo Balandan and his wife, damages in the sum of P2,000
We note that the canal NIA constructed was only eleven (11) for the death of their son Mario.
meters in width. This is well within the limit provided by
law. 31 Manglapus has therefore no cause to complain. It appears that the petitioner Hidalgo Enterprises, Inc. "was the
Article 619 of the Civil Code provides that, "Easements are owner of an ice-plant factory in the City of San Pablo, Laguna, in
established either by law or by the will of the owners. The former whose premises were installed two tanks full of water, nine feet
are called legal and the latter voluntary easements." In the present deep, for cooling purposes of its engine. While the factory
case, we find and declare that a legal easement of a right-of-way compound was surrounded with fence, the tanks themselves were
exists in favor of the government. The land was originally public not provided with any kind of fence or top covers. The edges of the
land, and awarded to respondent Manglapus by free patent. The tank were barely a foot high from the surface of the ground.
ruling would be otherwise if the land were originally private Through the wide gate entrance, which was continually open,
motor vehicles hauling ice and persons buying said commodity The appealed decision is reversed and the Hidalgo Enterprises,
passed, and any one could easily enter the said factory, as he Inc. is absolved from liability. No costs.
pleased. There was no guard assigned on the gate. At about noon Feria, Padilla, Tuason, Montemayor and Bautista Angelo,
of April 16, 1948, plaintiffs' son, Mario Balandan, a boy barely 8 JJ., concur.
years old, while playing with and in company of other boys of his ||| (Hidalgo Enterprises, Inc. v. Balandan, G.R. No. L-3422, [June
age, entered the factory premises through the gate, to take a bath 13, 1952], 91 PHIL 488-492)
in one of said tanks; and while thus bathing, Mario sank to the
bottom of the tank, only to be fished out later, already a cadaver,
having died of 'asphyxia secondary to drowning.'". Title 9 Registry of Property (Arts. 708-711)
Title 4 Prescription
1.Acquisitive Prescription
2.Extinctive Prescription
3.Laches
4.Prescription of Ownership and Other Real Rights (Arts.
1117-1138)
Prescription of Actions (Arts. 1139-1155)
UPDATES IN JURISPRUDENCE In the investigation report submitted by Special Investigator
LA TONDENA v. REPUBLIC Wilfredo B. Valera of the DENR, CENRO, San Fernando City, La
SECOND DIVISION Union, the land is covered by Survey Plan No. AP-01-004436
[G.R. No. 194617. August 5, 2015.] approved by the Regional Land District/Land Management
LA TONDEA, INC., petitioner, vs. REPUBLIC OF THE Bureau, Region I, pursuant to P.D. No. 239 dated September
PHILIPPINES, respondent. 1973; that it consists of 14,286 square meters and is located in
DECISION Brgy. Central West, Bauang, La Union; that the entire area is
LEONEN, J p: within the alienable and disposable zone as classified under
La Tondea, Inc. (La Tondea) applied for registration of a 14,286- Project No. 9, LC No. 3330 and released as well as certified as
square-meter parcel of land, with La Tondea alleging acquisition such on January 21, 1987; that this parcel of land is not within
and possession even before the Second World War. It argues the any civil or military reservations, and is outside of any forest zone
inadmissibility of the Department of Environment and Natural and watershed reservations; that it is not covered by any
Resources-Community Environment and Natural Resources previously issued land patent, decree or title; that this land was
Office's (DENR-CENRO) Report on the land's classification as declared for the first time in the year 1948 under Tax declaration
alienable and disposable only on January 21, 1987 as this Report No. 1745 in the name of La Tondea Distilleries with an area of
was not formally offered as evidence before the trial court. 13,292 square meters; that this land is now covered by Tax
This case involves an application of Section 14 (1) of Property declaration No. 27726 in the name of La Tondea Distilleria
Registration Decree in relation to Section 48 (b) of Commonwealth Incorporada; that the corresponding realty taxes as per record of
Act No. 141, as amended, on the requisites for judicial the Municipal Treasurer of Bauang, La Union have been paid since
confirmation of imperfect title. 1 1948; that this lot has not been earmarked for public use and not
This Petition for Review on Certiorari 2 assails the Court of reserved for any future government projects; that this lot is flat in
Appeals August 10, 2010 Decision 3 that reversed and set aside terrain, presently for agricultural purposes, with bamboos and
the Municipal Trial Court December 15, 2005 Decision 4 granting some fruit trees planted in it and about .00365 kilometers from the
La Tondea's application for land registration. 5 La Tondea prays poblacion; that this lot was found to be free from adverse claims
that this court reverse and set aside the Court of Appeals Decision and conflicts during the inspection; that La Tondea Distilleria
and Resolution, 6 then affirm in toto the Municipal Trial Court Incorporada is in actual occupation and possession of the land;
Decision or, in the alternative, remand the case for further that this lot does not encroach upon any bodies of water, Right of
reception of evidence. 7 Way, and park sites that are devoted to the public; and that during
On September 28, 2004, La Tondea, through its Vice President the investigation and ocular inspection of the area, applicant La
Rosendo A. Bautista, 8 filed an Application 9 for the registration of Tondea, Inc. thru its authorized representative, presented the
a 14,286-square-meter parcel of land in Central West, Bauang, La following documents, to wit: Print copy of AP-01-004436 and tax
Union. 10 declarations from the year 1948 up to the present. 21 (Emphasis
La Tondea alleged obtaining title or ownership by purchase from supplied)
one Pablo Rimorin and attached the following documents with its La Tondea alleged that this Report was not presented and
application: "(a) original tracing plan together with its print copies; formally offered during the proceedings, and it only learned of its
(b) technical description of the land; (c) certification, in lieu of lost existence during appeal. 22
Surveyor's Certificate for registration; (d) certificate of tax The Municipal Trial Court, in its Decision dated December 15,
assessment from 1948 up to the present; (e) copy of Tax 2005, approved La Tondea's application for registration:
Declaration No. 27726; and (f) copy of the Secretary's Certificate Considering that the government represented by the Asst.
authorizing Rosendo A. Bautista." 11 Provincial Prosecutor, Bauang, La Union for and in behalf of the
On October 15, 2004, the Land Registration Authority Solicitor General (SOLGEN) is not presenting any evidence,
Administrator forwarded the entire records to the Municipal Trial documentary or testimonial to substantiate the formal written
Court. 12 On December 17, 2004, the trial court sent a Notice of opposition which was filed, the said formal written opposition is
Initial Hearing to the Office of the Solicitor General. 13 hereby ordered dismissed for lack of merit.
On March 21, 2005, during the initial hearing, the trial court Wherefore, this Court, confirming the Order of Special Default,
entered an Order of Special Default against the whole world hereby approves the application and orders the adjudication and
except against the Republic of the Philippines that filed a formal registration of the land described in Survey Plan No. AP-01-
written opposition to the application. 14 004436 (Exh. "J") and the Technical description of said lot, Lot
The trial court scheduled the hearing for marking of exhibits on 4551, CAD 474-D, Bauang Cadastre (Exh. "K") containing an area
April 12, 2005. 15 Rosendo A. Bautista testified and identified the of Fourteen thousand two hundred eighty-six (14,286) square
documents submitted with the application for registration. 16 He meters situated at Brgy. Central West, Bauang, La Union.
alleged that all records showing La Tondea's purchase of the land Once this decision becomes final and executory, let the
from one Pablo Rimorin were burned, thus, applicant can only corresponding decree be issued.
present tax declarations in its name for years 1948, 1953, 1964, So Ordered. 23
1974, 1980, 1985, 1994, and 1999. 17 The Republic of the Philippines filed a Notice of Appeal 24 before
On May 30, 2005, La Tondea's property administrator Victor the Court of Appeals on the ground that the trial court's Decision
Dumuk testified that from the time his father, Juan Dumuk, was was "contrary to law and evidence." 25 It raised the Report dated
property administrator before the Second World War up to Victor May 31, 2005 on the land's classification as alienable and
Dumuk's present administration, La Tondea's ownership of the disposable only on January 21, 1987, thus, the land cannot be the
land was uncontested, and its possession was peaceful, subject matter of an application for judicial confirmation of
continuous, open, and public. 18He testified that property taxes imperfect title under Commonwealth Act No. 141 that requires
were paid from 1994 to 2005, and that mango trees and a possession from June 12, 1945 or earlier. 26
basketball court can be found on the land. 19 Instead of filing its Memorandum, La Tondea filed a Manifestation
DENR-CENRO Land Investigator Wilfredo Valera submitted a with Motion to Remand Case 27 dated January 29, 2007 to
Report dated May 31, 2005 to the trial court, stating that the land present further evidence that the land was private land at the time
was declared alienable and disposable only on January 21, of its acquisition. 28 The Court of Appeals noted the Comment of
1987. 20 The trial court summarized the Report's contents in its the Republic of the Philippines, and denied the Motion of La
Decision: CAIHTE Tondea. 29 DETACa
La Tondea filed a Motion for Reconsideration 30 dated other sanction ceases to be public land and becomes private
December 18, 2008 attaching as newly discovered evidence the property." 43
"Plan of Private Land as surveyed for Pablo Rimonin" under Psu- La Tondea contends that it presented sufficient evidence for
67458 duly approved on March 5, 1930. 31 The Court of Appeals approval of its application for registration. Alternatively, a remand
denied reconsideration. 32 would allow it to cross-examine Wilfredo Valera on his Report, and
The Court of Appeals, in its Decision dated August 10, 2010, La Tondea can present additional evidence to show that the land
reversed and set aside the Municipal Trial Court December 15, was private land as early as March 5, 1930 as stated in the "Plan
2005 Decision, and dismissed La Tondea's application for of Private Land as Surveyed for Pablo Rimorin" approved by the
registration. 33 It also denied reconsideration. 34 Department of Agriculture and Natural Resources. 44 ATICcS
Hence, La Tondea filed this Petition. The Republic of the Philippines counters that Section 29
La Tondea submits that the Report dated May 31, 2005 should of Presidential Decree No. 1529 provides that courts are "duty-
not have been considered by the trial court since it was not bound to consider not only the evidence presented by the [parties,]
identified and formally offered as evidence. 35Wilfredo Valera was but alto the reports of the Commissioner of Land Registration and
never presented in court, thus, he was never cross-examined in the Director of Lands[.]" 45
violation of La Tondea's right to due process. 36 La Tondea Assuming the Report dated May 31, 2005 is inadmissible in
alleges that it only saw a copy of the Report when the case was evidence, La Tondea still failed to present proof that the land was
on appeal. 37 declared alienable and disposable on or before June 12,
In any event, La Tondea raises the survey plan notation 1945. 46 La Tondea cannot rely on the notation on the Sephia
confirming that the land was "inside alienable and disposable area Plan of AP-01-004436 and its blueprint copy since this is not the
as per Project No. 09, L.C. Map No. 0333 as certified on Aug. 12, proof required by law. 47 Neither can La Tondea invoke the 30-
1934." 38 The survey plan was approved by the Department of year prescriptive period under Republic Act No.
Environment and Natural Resources in the performance of its 1942 since Presidential Decree No. 1073, already applicable
official function that carries the presumption of regularity. 39 La when La Tondea filed its application for registration in 2004,
Tondea argues that the Republic of the Philippines did not requires possession from June 12, 1945 or earlier. 48 The
controvert this evidence, and Wilfredo Valera's Report dated May Republic of the Philippines quoted at length Heirs of Mario
31, 2005 that was not formally offered as evidence cannot prevail Malabanan v. Republic 49 andRepublic v. Rizalvo, Jr. 50 on the
over the survey plan that the trial court duly admitted as 30-year rule on land registration. 51 Lastly, La Tondea cannot
evidence. 40 invoke Article 1113 of the Civil Code since it did not present
Assuming the land was only reclassified on January 21, 1987, La evidence that the state declared the land "no longer intended for
Tondea argues that it acquired a vested right over the land under public service or for the development of the national wealth." 52
the 1935 Constitution that allows a private corporation to acquire The issues for resolution are:
alienable and disposable land of public domain: 41 First, whether petitioner La Tondea, Inc. complied with all the
With due indulgence, the Honorable Court of Appeals failed to requirements for land registration under Section 48 (b)
consider that petitioner has acquired a vested right over the land of Commonwealth Act No. 141, as amended, in relation to Section
sought to be registered under the 1935 Philippine Constitution and 14 (1) of Presidential Decree No. 1529;
prior to the effectivity of the 1973 and 1987 Philippine Second, whether petitioner La Tondea, Inc. acquired a vested
Constitutions. As a general rule, constitutional provisions are given right under the 1935 Constitution that allows a private corporation
prospective application, not retroactive, unless retroactivity is to acquire alienable and disposable land of public domain; and
expressly provided or necessarily implied (People vs. Isagani, et Finally, whether the Court of Appeals can consider the Report
al., 63 SCRA 4). Hence, due to the prospective application of the dated May 31, 2005 that was not marked, identified, and formally
1973 and 1987 Constitutions, it is the provisions of the 1935 offered as evidence before the trial court.
Constitution that should apply to petitioner's application for We deny the Petition.
registration. Undoubtedly, under the 1935 Philippine Constitution, I
private corporations are allowed in acquiring alienable and Commonwealth Act No. 141 known as The Public Land Act covers
disposable land of the public domain. (Republic vs. T.A.N. matters such as "what lands are open to disposition or
Properties, Inc.[,] G.R. No. 154953, June 26, 2008). concession[.]" 53 Section 48 (b), as amended, governs judicial
Interestingly, the original reckoning point for the required length of confirmation of imperfect title:
possession under the Public Land Act (C.A. 141) is possession SEC. 48. The following-described citizens of the Philippines,
since July 26, 1894. The period of possession was shortened to occupying lands of the public domain or claiming to own any such
thirty (30) years by Republic Act No. 1942, which was enacted on lands or an interest therein, but whose titles have not been
June 22, 1957. Then, on January 25, 1977, Presidential Decree perfected or completed, may apply to the Court of First Instance of
No. 1073 was enacted pegging the reckoning point of possession the province where the land is located for confirmation of their
to June 12, 1945. Hence, until 1972, prior to the effectivity of the claims and the issuance of a certificate of title therefor, under the
1973 Philippine Constitution, the required possession of alienable Land Registration Act, to wit:
public land that would qualify to judicial confirmation under C.A. xxx xxx xxx
141 is at least thirty (30) years, or at least from the year 1942. If (b) Those who by themselves or through their predecessors in
reckoned from 1972, the latest date when private corporations are interest have been in open, continuous, exclusive, and
allowed to acquire alienable public lands. Therefore, petitioner notorious possession and occupation of alienable and
already acquired a vested right over the subject property in disposable lands of the public domain, under a bona fide claim of
1972. 42 acquisition or ownership, since June 12, 1945, or earlier,
La Tondea submits that "its possession was open, continuous, immediately preceding the filing of the applications for confirmation
uninterrupted for more than thirty (30) years until 1972 prior to the of title except when prevented by war or force majeure. These
effectivity of the 1973 and 1987 Philippine Constitution[,] [t]hus, shall be conclusively presumed to have performed all the
the land became a private property by acquisitive prescription in conditions essential to a Government grant and shall be entitled to
accordance with the doctrine that open, exclusive and undisputed a certificate of title under the provisions of this
possession of alienable land for the period prescribed by law chapter. 54 (Emphasis supplied)
creates the legal fiction whereby the land, upon completion of the Section 14 (1) of Presidential Decree No. 1529 known as
requisite period, ipso jure and without the need of judicial order or the Property Registration Decree similarly reads:
SEC. 14. Who may apply. The following persons may file in the prescribed. 63 In The Director of Lands v. Intermediate Appellate
proper Court of First Instance an application for registration of title Court, 64 "the land was already private land when Acme acquired
to land, whether personally or through their duly authorized it from its owners in 1962 and, thus, Acme acquired a registrable
representatives: title." 65
1. Those who by themselves or through their predecessors-in- In Republic v. T.A.N. Properties, Inc., 66 this court found The
interest have been in open, continuous, exclusive and notorious Director of Lands inapplicable since respondent corporation
possession and occupation of alienable and disposable lands of "acquired the land on 8 August 1997 from Porting, who, along with
the public domain under a bona fide claim of ownership since June his predecessors-in-interest, has not shown to have been, as of
12, 1945, or earlier. TIADCc that date, in open, continuous, and adverse possession of the land
Based on Section 48 (b) of the Public Land Act in relation to for 30 years since 12 June 1945[,] [i]n short, when respondent
Section 14 (1) of the Property Registration Decree, an applicant acquired the land from Porting, the land was not yet private
for land registration must comply with the following requirements: property." 67
1. The applicant, by himself or through his predecessor-in-interest, Similarly, petitioner has not shown any proof of its purchase of the
has been in possession and occupation of the property subject of land, alleging that all records of this transaction were
the application; burned. 68 Without evidence on the exact acquisition date, or the
2. The possession and occupation must be open, continuous, character of its predecessor's occupation or possession of the
exclusive, and notorious; land, 69 no proof exists that the property was already private land
3. The possession and occupation must be under a bona at the time of petitioner's acquisition.
fide claim of acquisition of ownership; Survey notations are not considered substantive evidence of the
4. The possession and occupation must have taken place since land's classification as alienable and disposable. Republic v.
June 12, 1945, or earlier; and T.A.N. Properties, Inc. discussed the required proof:
5. The property subject of the application must be an agricultural Further, it is not enough for the PENRO or CENRO to certify that
land of the public domain. 55 a land is alienable and disposable. The applicant for land
Petitioner argues that the survey plan notation stating that the land registration must prove that the DENR Secretary had approved the
was confirmed as alienable and disposable on August 12, 1934 land classification and released the land of the public domain as
should prevail over the Report dated May 31, 2005 stating that the alienable and disposable, and that the land subject of the
land was reclassified as alienable and disposable only on January application for registration falls within the approved area per
21, 1987 since this Report was not formally offered as evidence verification through survey by the PENRO or CENRO. In addition,
before the trial court. 56 the applicant for land registration must present a copy of the
Respondent counters that Section 29 of Presidential Decree No. original classification approved by the DENR Secretary and
1529 mandates the court to consider the Report dated May 31, certified as a true copy by the legal custodian of the official records.
2005, 57 and even assuming this Report is inadmissible, petitioner These facts must be established to prove that the land is alienable
still failed to prove that the land was declared alienable and and disposable. Respondent failed to do so because the
disposable on or before June 12, 1945. 58 Section 29 reads: certifications presented by respondent do not, by themselves,
SEC. 29. Judgment confirming title. All conflicting claims of prove that the land is alienable and disposable. 70 (Emphasis
ownership and interest in the land subject of the application shall supplied)
be determined by the court. If the court,after considering the Petitioner's contention that it acquired a vested right over the
evidence and the reports of the Commissioner of Land land in 1972 since Republic Act No. 1942 was enacted on June
Registration and the Director of Lands, finds that the applicant or 22, 1957 shortened the required possession to 30 years, thus, until
the oppositor has sufficient title proper for registration, judgment 1972 or prior to the 1973 Constitution and Presidential Decree No.
shall be rendered confirming the title of the applicant, or the 1073, the required possession for judicial confirmation is at least
oppositor, to the land or portions thereof. (Emphasis supplied) 30 years or at least from 1942 71 also fails to convince.
The parties' arguments on the admissibility of the Report dated Heirs of Mario Malabanan discussed that the 30-year-period rule
May 31, 2005 as evidence on when the land was classified as in Republic Act No. 1942 was repealed by Presidential Decree No.
alienable and disposable are mooted by this court's ruling in Heirs 1073 in 1977, thus, only applications for registration filed prior to
of Mario Malabanan v. Republic. 59 1977 may invoke Republic Act No. 1942. 72 Since petitioner only
Heirs of Mario Malabanan clarified that the June 12, 1945 filed for registration on September 28, 2004, the June 12, 1945
reckoning point refers to date of possession and not to date of land reckoning date under Presidential Decree No. 1073 applies.
classification as alienable and disposable. 60 III
This court held that "the agricultural land subject of the application Petitioner failed to prove possession and occupation since June
needs only to be classified as alienable and disposable as of the 12, 1945 or earlier.
time of the application, provided the applicant's possession and Petitioner's evidence consisted of tax declarations, and the
occupation of the land dated back to June 12, 1945, or earlier." 61 testimonies of Rosendo Bautista and Victor Dumuk. 73
Petitioner filed the application for registration on September 28, The trial court granted the application, despite lack of records
2004. All dates claimed as dates of classification of the land as showing petitioner's purchase and possession of the land prior to
alienable and disposable August 12, 1934 as stated in the June 12, 1945, by relying on Rosendo Bautista's testimony:
survey plan notation that petitioner relies upon; January 21, 1987 Based on the evidences [sic] presented, testimonial and
as stated in the Report dated May 31, 2005 that petitioner argues documentary as well, it is appearing that the applicant company,
to be inadmissible; and March 5, 1930 as stated in the "Plan of La Tondea, Inc., thru its representative has established a
Private Land as Surveyed for Pablo Rimorin" that petitioner would satisfactory proof that it has a registrable title over the subject
like to present as additional evidence if the court remands the case property, it being a corporation duly organized and existing under
were all prior to the September 28, 2004 application date, in the law of the Philippines with principal address at CPJ Bldg., 105
compliance with the Heirs of Mario Malabanan ruling. AIDSTE Carlos Palanca, Jr. St., Legaspi Village, Makati City, Metro Manila,
II and qualified to own, acquire and possess land in the
Petitioner's vested-right argument based on the 1935 Philippines, it being established that its possession dates
Constitution that allows a private corporation to acquire alienable back to 1948 when it was first declared for the first time but before
and disposable land of public domain 62 must also fail. that, said applicant La Tondea, Inc. has owned the land subject
Under the 1935 Constitution, private corporations can still acquire of this case before the Second World War since the oldest tax
public agricultural lands within the limited area declaration recorded which is Tax declaration No. 1745 series of
1948 cancelled Tax declaration No. 6590. Besides, this Court HEIRS OF MALABANAN v. REPUBLIC
believes the testimony of Rosendo Bautista to be trustworthy EN BANC
being given in the ordinary course of business when he [G.R. No. 179987. April 29, 2009.]
stated that La Tondea, Inc. acquired this property by HEIRS OF MARIO MALABANAN, petitioner, vs. REPUBLIC OF
purchase from a certain Pablo Rimorin but he had no records THE PHILIPPINES, respondent.
about that transaction and all that the company has are tax DECISION
declarations as early as 1948 and tax receipt. Hence, applicant TINGA, J p:
La Tondea, Inc. has established a satisfactory proof that it has a One main reason why the informal sector has not become formal
reg[i]strable title to the said land subject of this case since it has is that from Indonesia to Brazil, 90 percent of the informal lands
owned it for more than fifty-seven (57) years or more. 74 AaCTcI are not titled and registered. This is a generalized phenomenon in
The Court of Appeals did not err in reversing and setting aside the the so-called Third World. And it has many
trial court's Decision, and dismissing petitioner's application for consequences. STHDAc
registration. It discussed the insufficiency of proof regarding xxx xxx xxx
petitioner's acquisition of the land and, consequently, the The question is: How is it that so many governments, from
character of the alleged possession by its predecessor-in-interest: Suharto's in Indonesia to Fujimori's in Peru, have wanted to title
The OSG correctly points out the property is incapable of being these people and have not been able to do so effectively? One
the subject matter of an application for judicial confirmation of reason is that none of the state systems in Asia or Latin America
imperfect title under C.A. 141, as amended, even by a natural can gather proof of informal titles. In Peru, the informals have
person because of the requirement that the period of possession means of proving property ownership to each other which are not
must be from June 12, 1945 or earlier. Confronted with the DENR- the same means developed by the Spanish legal system. The
CENRO Report dated May 31, 2005, appellee did not present informals have their own papers, their own forms of agreements,
proof to establish its claim that the property was already alienable and their own systems of registration, all of which are very clearly
and disposable from the time it acquired the same in 1948, let stated in the maps which they use for their own informal business
alone, its allegation that it acquired the property by transactions.
purchase. Even Appellee's exact date of acquisition as If you take a walk through the countryside, from Indonesia to Peru,
purported buyer was not shown with clarity. Neither did it and you walk by field after field in each field a different dog is
show how its predecessor-in-interest himself got hold of the going to bark at you. Even dogs know what private property is all
property, the character of his possession or occupation, and about. The only one who does not know it is the government. The
how long a time did he exercise the same on the land, if at issue is that there exists a "common law" and an "informal law"
all. 75 (Emphasis supplied) which the Latin American formal legal system does not know how
On the tax declarations, the oldest recorded one presented by to recognize.
petitioner was for year 1948. 76 This does not prove possession Hernando De Soto 1
on or before June 12, 1945. 77 This decision inevitably affects all untitled lands currently in
In Republic v. Heirs of Doroteo Montoya, 78 the only evidence possession of persons and entities other than the Philippine
presented to prove occupation and possession from 1940 was a government. The petition, while unremarkable as to the facts, was
tax declaration for year 1947 with notation that realty tax payments accepted by the Court en banc in order to provide definitive clarity
were paid since 1940. 79 This court discussed that "[a] tax to the applicability and scope of original registration proceedings
declaration, much less a tax declaration the existence of which is under Sections 14 (1) and 14 (2) of the Property Registration
proved by means of an annotation, is not a conclusive evidence of Decree. In doing so, the Court confronts not only the relevant
ownership, which is, at best, only a basis for inferring provisions of the Public Land Act and the Civil Code, but also the
possession." 80 reality on the ground. The countrywide phenomenon of untitled
Petitioner claims possession even before the Second World War, lands, as well as the problem of informal settlement it has
yet petitioner only produced nine (9) tax declarations. 81 This spawned, has unfortunately been treated with benign neglect. Yet
court has held that "intermittent and sporadic assertion of alleged our current laws are hemmed in by their own circumscriptions in
ownership does not prove open, continuous, exclusive and addressing the phenomenon. Still, the duty on our part is primarily
notorious possession and occupation." 82 to decide cases before us in accord with the Constitution and the
This court has also held that "it is only when these tax declarations legal principles that have developed our public land law, though
are coupled with proof of actual possession of the property that our social obligations dissuade us from casting a blind eye on the
they may become the basis of a claim of ownership." 83 endemic problems.
On property administrator Victor Dumuk's testimony, he I.
mentioned that his father was property administrator before the On 20 February 1998, Mario Malabanan filed an application for
Second World War until he died in 1984 after which his mother, land registration covering a parcel of land identified as Lot 9864-
Felicidad Dumuk, took over. 84 While the tax declarations A, Cad-452-D, Silang Cadastre, 2 situated in Barangay Tibig,
indicated his father as property administrator, 85 again, none of Silang Cavite, and consisting of 71,324 square
these were issued on or before June 12, 1945. meters. Malabanan claimed that he had purchased the property
The letter dated March 23, 1994 86 of petitioner's VP Treasurer from Eduardo Velazco, 3 and that he and his predecessors-in-
Amando C. Ramat, Jr. to Victor Dumuk confirming Victor Dumuk interest had been in open, notorious, and continuous adverse and
as caretaker of all petitioner's properties in Bauang, La Union peaceful possession of the land for more than thirty (30)
effective January 1, 1994 87 also does not prove possession on years. HaSEcA
or before June 12, 1945. The application was raffled to the Regional Trial Court of (RTC)
Since petitioner failed to comply with all the requisites for Cavite-Tagaytay City, Branch 18. The Office of the Solicitor
registration as provided by law, the Court of Appeals did not err in General (OSG) duly designated the Assistant Provincial
reversing the trial court, and dismissing petitioner's application for Prosecutor of Cavite, Jose Velazco, Jr., to appear on behalf of the
registration. State. 4 Apart from presenting documentary
WHEREFORE, the Petition is DENIED. EcTCAD evidence, Malabanan himself and his witness, Aristedes Velazco,
SO ORDERED. testified at the hearing. Velazco testified that the property was
||| (La Tondea, Inc. v. Republic, G.R. No. 194617, [August 5, originally belonged * to a twenty-two hectare property owned by
2015]) his great-grandfather, Lino Velazco. Lino had four sons
Benedicto, Gregorio, Eduardo and Esteban the fourth being
Aristedes's grandfather. Upon Lino's death, his four sons inherited Therefore, with respect to agricultural lands, any possession prior
the property and divided it among themselves. But by 1966, to the declaration of the alienable property as disposable may be
Esteban's wife, Magdalena, had become the administrator of all counted in reckoning the period of possession to perfect title
the properties inherited by the Velazco sons from their father, Lino. under the Public Land Act and the Property Registration Decree.
After the death of Esteban and Magdalena, their son Virgilio The petition was referred to the Court en banc, 12 and on 11
succeeded them in administering the properties, including Lot November 2008, the case was heard on oral arguments. The
9864-A, which originally belonged to his uncle, Eduardo Velazco. Court formulated the principal issues for the oral arguments, to
It was this property that was sold by Eduardo Velazco wit: HICEca
to Malabanan. 5 1. In order that an alienable and disposable land of the public
Assistant Provincial Prosecutor Jose Velazco, Jr. did not cross- domain may be registered under Section 14(1) of Presidential
examine Aristedes Velazco. He further manifested that he "also Decree No. 1529, otherwise known as the Property Registration
[knew] the property and I affirm the truth ofthe testimony given by Decree, should the land be classified as alienable and disposable
Mr. Velazco." 6 The Republic of the Philippines likewise did not as of June 12, 1945 or is it sufficient that such classification occur
present any evidence to controvert the application. at any time prior to the filing of the applicant for registration
Among the evidence presented by Malabanan during trial was a provided that it is established that the applicant has been in open,
Certification dated 11 June 2001, issued by the Community continuous, exclusive and notorious possession of the land under
Environment & Natural Resources Office, a bona fide claim of ownership since June 12, 1945 or earlier?
Department of Environment and Natural Resources (CENRO- 2. For purposes of Section 14(2) of the Property Registration
DENR), which stated that the subject property was "verified to be Decree may a parcel of land classified as alienable and
within the Alienable or Disposable land per Land Classification disposable be deemed private land and therefore susceptible to
Map No. 3013 established under Project No. 20-A and approved acquisition by prescription in accordance with the Civil Code?
as such under FAO 4-1656 on March 15, 1982." 7 3. May a parcel of land established as agricultural in character
On 3 December 2002, the RTC rendered judgment in either because of its use or because its slope is below
favor of Malabanan, the dispositive portion of which reads: that of forest lands be registrable under Section
WHEREFORE, this Court hereby approves this application for 14(2) ofthe Property Registration Decree in relation to the
registration and thus places under the operation of Act 141, Act provisions of the Civil Code on acquisitive prescription?
496 and/or P.D. 1529, otherwise known as Property Registration 4. Are petitioners entitled to the registration of the subject land in
Law, the lands described in Plan Csd-04-0173123-D, Lot 9864-A their names under Section 14(1) or Section 14(2) of the Property
and containing an area of Seventy One Thousand Three Hundred Registration Decree or both? 13
Twenty Four (71,324) Square Meters, as supported by its technical Based on these issues, the parties formulated their respective
description now forming part of the record of this case, in addition positions.
to other proofs adduced in the name of MARIO MALABANAN, With respect to Section 14 (1), petitioners reiterate that the
who is oflegal age, Filipino, widower, and with residence at analysis of the Court in Naguit is the correct interpretation of the
Munting Ilog, Silang, Cavite. HcDaAI provision. The seemingly contradictory pronouncement
Once this Decision becomes final and executory, the in Herbieto, it is submitted, should be considered obiter
corresponding decree of registration shall forthwith issue. dictum, since the land registration proceedings therein was
SO ORDERED. void ab initio due to lack of publication of the notice of initial
The Republic interposed an appeal to the Court of Appeals, hearing. Petitioners further point out that in Republic v.
arguing that Malabanan had failed to prove that the property Bibonia, 14 promulgated in June of 2007, the Court
belonged to the alienable and disposable land ofthe public applied Naguit and adopted the same observation that the
domain, and that the RTC had erred in finding that he had been in preferred interpretation by the OSG of Section 14 (1) was patently
possession of the property in the manner and for the length of time absurd. For its part, the OSG remains insistent that for Section 14
required by law for confirmation of imperfect title. (1) to apply, the land should have been classified as alienable and
On 23 February 2007, the Court of Appeals rendered a disposable as of 12 June 1945. Apart from Herbieto, the OSG also
Decision 8 reversing the RTC and dismissing the cites the subsequent rulings
application of Malabanan. The appellate court held that under in Buenaventura v. Republic, 15 Fieldman Agricultural
Section 14 (1) of the Property Registration Decree any Trading v. Republic 16 and Republic v. Imperial Credit
period of possession prior to the classification of the lots as Corporation, 17 as well as the earlier case of Director of Lands v.
alienable and disposable was inconsequential and should be Court of Appeals. 18 ACTEHI
excluded from the computation of the period of possession. Thus,
the appellate court noted that since the CENRO-DENR With respect to Section 14 (2), petitioners submit that open,
certification had verified that the property was declared alienable continuous, exclusive and notorious possession of an alienable
and disposable only on 15 March 1982, the Velazcos' possession land of the public domain for more than 30 years ipso
prior to that date could not be factored in the computation of the jure converts the land into private property, thus placing it under
period of possession. This interpretation of the the coverage of Section 14 (2). According to them, it would not
Court of Appeals of Section 14 (1) of the Property Registration matter whether the land sought to be registered was previously
Decree was based on the Court's ruling in Republic v. Herbieto. 9 classified as agricultural land of the public domain so long as, at
Malabanan died while the case was pending with the the time of the application, the property had already been
Court of Appeals; 10 hence, it was his heirs who appealed the "converted" into private property through prescription. To bolster
decision of the appellate court. Petitioners, before this Court, rely their argument, petitioners cite extensively from our 2008 ruling
on our ruling in Republic v. Naguit, 11 which was handed down in Republic v. T.A.N. Properties. 19
just four months prior to Herbieto. Petitioners suggest that the The arguments submitted by the OSG with respect to Section 14
discussion in Herbieto cited by the Court of Appeals is (2) are more extensive. The OSG notes that under Article
actually obiter dictum since the Metropolitan Trial Court therein 1113 of the Civil Code, the acquisitive
which had directed the registration of the property had no prescription of properties of the State refers to "patrimonial
jurisdiction in the first place since the requisite notice of hearing property", while Section 14 (2) speaks of "private lands". It
was published only after the hearing had already observes that the Court has yet to decide a case that presented
begun. Naguit, petitioners argue, remains the controlling doctrine, Section 14 (2) as a ground for application for registration, and that
especially when the property in question is agricultural land. the 30-year possession period refers to the period of possession
under Section 48 (b) of the Public Land Act, and not the commenced from July 26, 1894. However, this period was
concept of prescription under the Civil Code. The OSG further amended by R.A. No. 1942, which provided that the bona
submits that, assuming that the 30-year prescriptive period can run fide claim of ownership must have been for at least thirty (30)
against public lands, said period should be reckoned from the time years. Then in 1977, Section 48(b) of the Public Land Act was
the public land was declared alienable and disposable. again amended, this time by P.D. No. 1073, which pegged the
Both sides likewise offer special arguments with respect to the reckoning date at June 12, 1945. . . .
particular factual circumstances surrounding the subject property It bears further observation that Section 48 (b) of Com. Act No,
and the ownership thereof. 141 is virtually the same as Section 14 (1) of the Property
II. Registration Decree. Said Decree codified the various laws
First, we discuss Section 14 (1) of the Property Registration relative to the registration of property, including lands of the public
Decree. For a full understanding of the provision, reference has to domain. It is Section 14 (1) that operationalizes the
be made to the Public Land Act. HSEIAT registration of such lands of the public domain. The provision
A. reads:
Commonwealth Act No. 141, also known as the Public Land Act, SEC. 14. Who may apply. The following persons may file in the
has, since its enactment, governed the classification and proper Court of First Instance an application for registration of title
disposition of lands of the public domain. The President is to land, whether personally or through their duly authorized
authorized, from time to time, to classify the lands of the public representatives:
domain into alienable and disposable, timber, or mineral (1) those who by themselves or through their predecessors-in-
lands. 20 Alienable and disposable lands ofthe public domain are interest have been in open, continuous, exclusive and notorious
further classified according to their uses into (a) agricultural; (b) possession and occupation of alienable and disposable
residential, commercial, industrial, or for similar productive lands of the public domain under a bona fide claim of ownership
purposes; (c) educational, charitable, or other similar purposes; or since June 12, 1945, or earlier. SDTIaE
(d) reservations for town sites and for public and quasi-public Notwithstanding the passage of the Property Registration
uses. 21 Decree and the inclusion of Section 14 (1) therein, the Public Land
May a private person validly seek the registration in his/her Act has remained in effect. Both laws commonly refer to persons
name of alienable and disposable lands of the public domain? or their predecessors-in-interest who "have been in open,
Section 11 of the Public Land Act acknowledges that public lands continuous, exclusive and notorious possession and
suitable for agricultural purposes may be disposed of "by occupation of alienable and disposable lands of the public domain
confirmation of imperfect or incomplete titles" through "judicial under a bona fide claim of ownership since June 12, 1945, or
legalization". 22 Section 48 (b) of the Public Land Act, as earlier." That circumstance may have led to the impression that
amended by P.D. No. 1073, supplies the details and unmistakably one or the other is a redundancy, or that Section 48 (b) of the
grants that right, subject to the requisites stated therein: Public Land Act has somehow been repealed or mooted. That is
Sec. 48. The following described citizens of the Philippines, not the case.
occupying lands of the public domain or claiming to own any such The opening clauses of Section 48 of the Public Land Act and
land or an interest therein, but whose titles have not been Section 14 of the Property Registration Decree warrant
perfected or completed, may apply to the Court of First comparison:
Instance of the province where the land is located for Sec. 48 [of the Public Land Act]. The following described
confirmation of their claims and the issuance of a certificate of title citizens of the Philippines, occupying lands of the public domain or
therefor, under the Land Registration Act, to wit: claiming to own any such land or an interest therein, but whose
xxx xxx xxx titles have not been perfected or completed, may apply to the
(b) Those who by themselves or through their predecessors in Court of First Instance of the province where the land is located for
interest have been in open, continuous, exclusive, and notorious confirmation of their claims and the issuance of a certificate of title
possession and occupation of alienable and disposable therefor, under the Land Registration Act, to wit:
lands of the public domain, under a bona fide xxx xxx xxx
claim of acquisition of ownership, since June 12, 1945, or earlier, Sec. 14 [of the Property Registration Decree]. Who may apply.
immediately preceding the filing of the application for The following persons may file in the proper Court of First Instance
confirmation of title except when prevented by war or force an application for registration of title to land, whether personally or
majeure. These shall be conclusively presumed to have performed through their duly authorized representatives:
all the conditions essential to a Government grant and shall be xxx xxx xxx
entitled to a certificate of title under the provisions of this It is clear that Section 48 of the Public Land Act is more
chapter. DEHcTI descriptive of the nature of the right enjoyed by the possessor
Section 48 (b) of Com. Act No. 141 received its present wording in than Section 14 of the Property Registration Decree, which seems
1977 when the law was amended by P.D. No. 1073. Two to presume the pre-existence of the right, rather than establishing
significant amendments were introduced by P.D. No. the right itself for the first time. It is proper to assert that it is the
1073. First, the term "agricultural lands" was changed to "alienable Public Land Act, as amended by P.D. No. 1073 effective 25
and disposable lands of the public domain". The OSG submits that January 1977, that has primarily established the right of a Filipino
this amendment restricted the scope ofthe lands that may be citizen who has been "in open, continuous, exclusive, and
registered. 23 This is not actually the case. Under Section 9 of the notorious possession and occupation of alienable and disposable
Public Land Act, "agricultural lands" are a mere lands of the public domain, under a bona fide
subset of "lands of the public domain alienable or open to claim of acquisition of ownership, since June 12, 1945" to perfect
disposition." Evidently, alienable and disposable lands of the or complete his title by applying with the proper court for the
public domain are a larger class than only "agricultural lands". confirmation of his ownership claim and the issuance of the
Second, the length of the requisite possession was changed from corresponding certificate of title. DCSETa
possession for "thirty (30) years immediately preceding the Section 48 can be viewed in conjunction with the afore-quoted
filing of the application" to possession "since June 12, 1945 or Section 11 of the Public Land Act, which provides that public lands
earlier". The Court in Naguit explained: suitable for agricultural purposes may be disposed of by
When the Public Land Act was first promulgated in 1936, the confirmation of imperfect or incomplete titles, and given the notion
period of possession deemed necessary to vest the right to that both provisions declare that it is indeed the Public Land
register their title to agricultural lands of the public domain Act that primarily establishes the substantive ownership of the
possessor who has been in possession of the property since 12 alienation or disposition, the presumption is that the government
June 1945. In turn, Section 14 (a) of the Property Registration is still reserving the right to utilize the property; hence, the need to
Decree recognizes the substantive right granted under Section 48 preserve its ownership in the State irrespective of the
(b) of the Public Land Act, as well provides the corresponding length of adverse possession even if in good faith. However, if the
original registration procedure for the judicial confirmation of an property has already been classified as alienable and disposable,
imperfect or incomplete title. as it is in this case, then there is already an intention on the
There is another limitation to the right granted under Section 48 part of the State to abdicate its exclusive prerogative over the
(b). Section 47 of the Public Land Act limits the period within which property. EIcSTD
one may exercise the right to seek registration under Section 48. The Court declares that the correct interpretation of Section 14 (1)
The provision has been amended several times, most recently is that which was adopted in Naguit. The contrary pronouncement
by Rep. Act No. 9176 in 2002. It currently reads thus: in Herbieto, as pointed out in Naguit,absurdly limits the
Section 47. The persons specified in the next following section are application of the provision to the point of virtual inutility since it
hereby granted time, not to extend beyond December 31, 2020 would only cover lands actually declared alienable and disposable
within which to avail of the benefits of this Chapter: Provided, That prior to 12 June 1945, even if the current possessor is able to
this period shall apply only where the area applied for does not establish open, continuous, exclusive and notorious possession
exceed twelve (12) hectares: Provided, further, That the several under a bona fide claim of ownership long before that date.
periods of time designated by the President in accordance with Moreover, the Naguit interpretation allows more possessors under
Section Forty-Five of this Act shall apply also to the lands a bona fide claim of ownership to avail of judicial
comprised in the provisions of this Chapter, but this Section shall confirmation of their imperfect titles than what would be feasible
not be construed as prohibiting any said persons from acting under under Herbieto. This balancing fact is significant, especially
this Chapter at any time prior to the period fixed by the considering our forthcoming discussion on the scope and
President. 24 reach of Section 14 (2) of the Property Registration Decree.
Petitioners make the salient observation that the contradictory
Accordingly under the current state of the law, the substantive passages from Herbieto are obiter dicta since the land registration
right granted under Section 48 (b) may be availed of only until 31 proceedings therein is void ab initio in the first place due to
December 2020. lack of the requisite publication of the notice of initial hearing.
B. There is no need to explicitly overturn Herbieto, as it suffices that
Despite the clear text of Section 48 (b) of the Public Land Act, as the Court's acknowledgment that the particular line of argument
amended and Section 14 (a) of the Property Registration Decree, used therein concerning Section 14 (1) is indeed obiter.
the OSG has adopted the position that for one to acquire the right It may be noted that in the subsequent
to seek registration of an alienable and disposable land of the case of Buenaventura, 26 the Court, citing Herbieto, again stated
public domain, it is not enough that the applicant and his/her that "[a]ny period of possession prior to the date when the [s]ubject
predecessors-in-interest be in possession under a bona [property was] classified as alienable and disposable is
fide claim of ownership since 12 June 1945; the alienable and inconsequential and should be excluded from the
disposable character of the property must have been declared computation of the period of possession. . ." That statement, in the
also as of 12 June 1945. Following the OSG's approach, all lands context of Section 14 (1), is certainly erroneous. Nonetheless, the
certified as alienable and disposable after 12 June 1945 cannot be passage as cited in Buenaventura should again be considered
registered either under Section 14 (1) of the Property Registration as obiter. The application therein was ultimately granted, citing
Decree or Section 48 (b) of the Public Land Act as amended. The Section 14 (2). The evidence submitted by petitioners therein did
absurdity of such an implication was discussed in Naguit. EcTDCI not establish any mode of possession on their part prior to 1948,
Petitioner suggests an interpretation that the alienable and thereby precluding the application of Section 14 (1). It is not even
disposable character of the land should have already been apparent from the decision whether petitioners therein had
established since June 12, 1945 or earlier. This is not borne out claimed entitlement to original registration following Section 14 (1),
by the plain meaning of Section 14(1). "Since June 12, 1945", as their position being that they had been in exclusive possession
used in the provision, qualifies its antecedent phrase "under a under a bona fide claim of ownership for over fifty (50) years, but
bonafide claim of ownership". Generally speaking, qualifying not before 12 June 1945. aCHDST
words restrict or modify only the words or phrases to which they Thus, neither Herbieto nor its principal discipular
are immediately associated, and not those distantly or remotely ruling Buenaventura has any precedental value with respect to
located. 25 Ad proximum antecedents fiat relation nisi impediatur Section 14 (1). On the other hand, the ratio of Naguit is embedded
sentencia. in Section 14 (1), since it precisely involved situation wherein the
Besides, we are mindful of the absurdity that would result if we applicant had been in exclusive possession under a bona
adopt petitioner's position. Absent a legislative amendment, the fide claim of ownership prior to 12 June 1945. The Court's
rule would be, adopting the OSG's view, that all lands of the public interpretation of Section 14 (1) therein was decisive to the
domain which were not declared alienable or disposable before resolution of the case. Any doubt as to which
June 12, 1945 would not be susceptible to original registration, no between Naguit or Herbieto provides the final word ofthe Court on
matter the length ofunchallenged possession by the occupant. Section 14 (1) is now settled in favor of Naguit.
Such interpretation renders paragraph (1) of Section 14 virtually We noted in Naguit that it should be distinguished
inoperative and even precludes the government from giving it from Bracewell v. Court of Appeals 27 since in the latter, the
effect even as it decides to reclassify public agricultural lands as application for registration had been filed before the land was
alienable and disposable. The unreasonableness of the situation declared alienable or disposable. The dissent though
would even be aggravated considering that before June 12, 1945, pronounces Bracewell as the better rule between the two. Yet two
the Philippines was not yet even considered an independent years after Bracewell, its ponente, the esteemed Justice
state. Consuelo Ynares-Santiago, penned the ruling in Republic v.
Accordingly, the Court in Naguit explained: Ceniza, 28 which involved a claim of possession that extended
[T]he more reasonable interpretation of Section 14(1) is that it back to 1927 over a public domain land that was declared
merely requires the property sought to be registered as already alienable and disposable only in
alienable and disposable at the time the application for 1980. Ceniza cited Bracewell, quoted extensively from it, and
registration of title is filed. If the State, at the time the application following the mindset of the dissent, the attempt at registration
is made, has not yet deemed it proper to release the property for in Ceniza should have failed. Not so.
To prove that the land subject of an application for registration is acquired ownership of private lands by prescription under the
alienable, an applicant must establish the existence of a positive provisions of existing laws." DEcSaI
act of the government such as a presidential proclamation or an Prescription is one of the modes of acquiring ownership under the
executive order; an administrative action; investigation Civil Code. [ 30 ] There is a consistent jurisprudential rule that
reports of Bureau of Lands investigators; and a legislative act or a properties classified as alienable public land may be converted
statute. into private property by reason of open, continuous and exclusive
In this case, private respondents presented a certification dated possession of at least thirty (30) years. [ 31 ] With such
November 25, 1994, issued by Eduardo M. Inting, the Community conversion, such property may now fall within the
Environment and Natural Resources Officer in the contemplation of "private lands" under Section 14(2), and thus
Department of Environment and Natural Resources Office in Cebu susceptible to registration by those who have acquired ownership
City, stating that the lots involved were "found to be within the through prescription. Thus, even if possession of the alienable
alienable and disposable (sic) Block-I, Land Classification Project public land commenced on a date later than June 12, 1945, and
No. 32-A, per map 2962 4-I555 dated December 9, 1980". This is such possession being been open, continuous and exclusive, then
sufficient evidence to show the real character of the land the possessor may have the right to register the land by
subject of private respondents' application. Further, the virtue of Section 14(2) of the Property Registration Decree.
certification enjoys a presumption of regularity in the Naguit did not involve the application of Section 14 (2), unlike in
absence of contradictory evidence, which is true in this case. this case where petitioners have based their registration bid
Worth noting also was the observation of the Court of Appeals primarily on that provision, and where the evidence definitively
stating that: establishes their claim of possession only as far back as 1948. It
[n]o opposition was filed by the Bureaus of Lands and Forestry to is in this case that we can properly appreciate the nuances of the
contest the application of appellees on the ground that the provision.
property still forms part of the public domain. Nor is there any A.
showing that the lots in question are forestal land. . . . IDASHa The obiter in Naguit cited the Civil Code provisions on prescription
Thus, while the Court of Appeals erred in ruling that mere as the possible basis for application for original registration under
possession of public land for the period required by law would Section 14 (2). Specifically, it is Article 1113 which provides legal
entitle its occupant to a confirmation of imperfect title, it did not err foundation for the application. It reads:
in ruling in favor of private respondents as far as the first All things which are within the commerce of men are
requirement in Section 48(b) of the Public Land Act is concerned, susceptible of prescription, unless otherwise provided.
for they were able to overcome the burden of proving the Property of the State or any of its subdivisions not patrimonial in
alienability of the land subject of their application. character shall not be the object of prescription.
As correctly found by the Court of Appeals, private respondents It is clear under the Civil Code that where lands of the public
were able to prove their open, continuous, exclusive and notorious domain are patrimonial in character, they are susceptible to
possession of the subject land even before the year 1927. As a acquisitive prescription. On the other hand, among the public
rule, we are bound by the factual findings of the Court of Appeals. domain lands that are not susceptible to acquisitive prescription
Although there are exceptions, petitioner did not show that this is are timber lands and mineral lands. The Constitution itself
one of them. 29 proscribes private ownership oftimber or mineral lands. caTESD
Why did the Court in Ceniza, through the same eminent member There are in fact several provisions in the Civil Code concerning
who authored Bracewell, sanction the registration under Section the acquisition of real property through prescription.
48 (b) of public domain lands declared alienable or disposable Ownership of real property may be acquired by ordinary
thirty-five (35) years and 180 days after 12 June 1945? The telling prescription of ten (10) years, 32 or through extraordinary
difference is that in Ceniza, the application for registration was prescription of thirty (30) years. 33 Ordinary acquisitive
filed nearly six (6) years after the land had been declared prescription requires possession in good faith, 34 as well as just
alienable or disposable, while in Bracewell, the application was title. 35
filed nine (9) years before the land was declared alienable or When Section 14 (2) of the Property Registration Decree explicitly
disposable. That crucial difference was also stressed in Naguit to provides that persons "who have acquired ownership over private
contradistinguish it from Bracewell, a difference which the dissent lands by prescription under the provisions of existing laws", it
seeks to belittle. unmistakably refers to the Civil Code as a valid basis for the
III. registration of lands. The Civil Code is the only existing law that
We next ascertain the correct framework of analysis with respect specifically allows the acquisition by prescription of private lands,
to Section 14 (2). The provision reads: including patrimonial property belonging to the State. Thus, the
SEC. 14. Who may apply. The following persons may file in the critical question that needs affirmation is whether Section 14 (2)
proper Court of First Instance an application for registration of title does encompass original registration proceedings over
to land, whether personally or through their duly authorized patrimonial property of the State, which a private person has
representatives: acquired through prescription.
The Naguit obiter had adverted to a frequently reiterated
xxx xxx xxx jurisprudence holding that properties classified as alienable public
(2) Those who have acquired ownership over private lands by land may be converted into private property by reason of open,
prescription under the provisions of existing laws. continuous and exclusive possession of at least thirty (30)
The Court in Naguit offered the following discussion concerning years. 36 Yet if we ascertain the source of the "thirty-year" period,
Section 14 (2), which we did even then recognize, and still do, to additional complexities relating to Section 14 (2) and to how
be an obiter dictum, but we nonetheless refer to it as material for exactly it operates would emerge. For there are in fact two
further discussion, thus: distinct origins of the thirty (30)-year rule.
Did the enactment of the Property Registration Decree and the The first source is Rep. Act No. 1942, enacted in 1957, which
amendatory P.D. No. 1073 preclude the application for amended Section 48 (b) of the Public Land Act by granting the
registration of alienable lands of the public domain, possession right to seek original registration of alienable public lands through
over which commenced only after June 12, 1945? It did not, possession in the concept of an owner for at least thirty years.
considering Section 14(2) of the Property Registration Decree, The following-described citizens of the Philippines, occupying
which governs and authorizes the application of "those who have lands of the public domain or claiming to own any such lands or an
interest therein, but whose titles have not been perfected or
completed, may apply to the Court of First Instance of the (1) Those intended for public use, such as roads, canals, rivers,
province where the land is located for confirmation of their claims torrents, ports and bridges constructed by the State, banks,
and the issuance of a certificate of title therefor, under the Land shores, roadsteads, and others of similar character;
Registration Act, to wit: TDCaSE (2) Those which belong to the State, without being for public use,
xxx xxx xxx and are intended for some public service or for the
(b) Those who by themselves or through their predecessors in development of the national wealth.
interest have been in open, continuous, exclusive and notorious Art. 421. All other property of the State, which is not of the
possession and occupation of agricultural lands of the public character stated in the preceding article, is patrimonial property.
domain, under a bona fide claim of acquisition of ownership, for at It is clear that property of public dominion, which generally
least thirty years immediately preceding the filing of the includes property belonging to the State, cannot be the
application for confirmation of title, except when prevented by object of prescription or, indeed, be subject of the
war or force majeure. These shall be conclusively presumed to commerce of man. 39 Lands of the public domain, whether
have performed all the conditions essential to a Government grant declared alienable and disposable or not, are property of public
and shall be entitled to a certificate of title under the dominion and thus insusceptible to acquisition by prescription.
provisions of this Chapter. (emphasis supplied) 37 Let us now explore the effects under the Civil Code of a
This provision was repealed in 1977 with the enactment of P.D. declaration by the President or any duly authorized government
1073, which made the date 12 June 1945 the reckoning point for officer of alienability and disposability of lands ofthe public
the first time. Nonetheless, applications for registration filed prior domain. Would such lands so declared alienable and disposable
to 1977 could have invoked the 30-year rule introduced by Rep. be converted, under the Civil Code, from property of the public
Act No. 1942. dominion into patrimonial property? After all, by connotative
The second source is Section 14 (2) of P.D. 1529 itself, at least by definition, alienable and disposable lands may be the object of the
implication, as it applies the rules on prescription under the Civil commerce of man; Article 1113 provides that all things within the
Code, particularly Article 1113 in relation to Article 1137. Note that commerce of man are susceptible to prescription; and the same
there are two kinds of prescription under the Civil Code ordinary provision further provides that patrimonial property of the State
acquisitive prescription and extraordinary acquisitive prescription, may be acquired by prescription. IEcDCa
which, under Article 1137, is completed "through uninterrupted
adverse possession. . . for thirty years, without need of title Nonetheless, Article 422 of the Civil Code states that
or of good faith". "[p]roperty of public dominion, when no longer intended for public
Obviously, the first source of the thirty (30)-year period rule, Rep. use or for public service, shall form part of the patrimonial
Act No. 1942, became unavailable after 1977. At present, the only property of the State". It is this provision that controls how public
legal basis for the thirty (30)-year period is the law on prescription dominion property may be converted into patrimonial property
under the Civil Code, as mandated under Section 14 (2). However, susceptible to acquisition by prescription. After all, Article 420 (2)
there is a material difference between how the thirty (30)-year rule makes clear that those property "which belong to the State, without
operated under Rep. Act No. 1942 and how it did under the Civil being for public use, and are intended for some public service or
Code. for the development of the national wealth" are public dominion
Section 48 (b) of the Public Land Act, as amended by Rep. Act No. property. For as long as the property belongs to the State,
1942, did not refer to or call into application the Civil Code although already classified as alienable or disposable, it remains
provisions on prescription. It merely set forth a requisite thirty-year property of the public dominion if when * it is "intended for some
possession period immediately preceding the application for public service or for the development of the national wealth".
confirmation of title, without any qualification as to whether the Accordingly, there must be an express declaration by the
property should be declared alienable at the beginning of, and State that the public dominion property is no longer intended
continue as such, throughout the entire thirty (30) years. There is for public service or the development ofthe national wealth or
neither statutory nor jurisprudential basis to assert Rep. Act No. that the property has been converted into patrimonial.
1942 had mandated such a requirement, 38 similar to our earlier Without such express declaration, the property, even if
finding with respect to the present language of Section 48 (b), classified as alienable or disposable, remains property of the
which now sets 12 June 1945 as the point of reference. public dominion, pursuant to Article 420 (2), and thus
Then, with the repeal of Rep. Act No. 1942, the thirty-year incapable of acquisition by prescription. It is only when such
possession period as basis for original registration became alienable and disposable lands are expressly declared by the
Section 14 (2) of the Property Registration Decree, which entitled State to be no longer intended for public service or for the
those "who have acquired ownership over private lands by development of the national wealth that the
prescription under the provisions of existing laws" to apply for period ofacquisitive prescription can begin to run. Such
original registration. Again, the thirty-year period is derived from declaration shall be in the form of a law duly enacted by
the rule on extraordinary prescription under Article 1137 of the Congress or a Presidential Proclamation in cases where the
Civil Code. At the same time, Section 14 (2) puts into operation President is duly authorized by law.
the entire regime ofprescription under the Civil Code, a fact which It is comprehensible with ease that this reading of Section 14
does not hold true with respect to Section 14 (1). (2) of the Property Registration Decree limits its scope and reach
B. and thus affects the registrability even oflands already declared
Unlike Section 14 (1), Section 14 (2) explicitly refers to the alienable and disposable to the detriment of the bona
principles on prescription under existing laws. Accordingly, we are fide possessors or occupants claiming title to the lands. Yet this
impelled to apply the civil law concept ofprescription, as set forth interpretation is in accord with the Regalian doctrine and its
in the Civil Code, in our interpretation of Section 14 (2). There is concomitant assumption that all lands owned by the State,
no similar demand on our part in the case of Section 14 although declared alienable or disposable, remain as such and
(1). DSHTaC ought to be used only by the Government.
The critical qualification under Article 1113 of the Civil Code is Recourse does not lie with this Court in the matter. The duty of the
thus: "[p]roperty of the State or any of its subdivisions not Court is to apply the Constitution and the laws in accordance with
patrimonial in character shall not be the object ofprescription". The their language and intent. The remedy is to change the law, which
identification what consists of patrimonial property is provided by is the province of the legislative branch. Congress can very well
Articles 420 and 421, which we quote in full: be entreated to amend Section 14 (2) of the Property Registration
Art. 420. The following things are property of public dominion: Decree and pertinent provisions of the Civil Code to liberalize the
requirements for judicial confirmation of imperfect or incomplete while the registration under Section 14 (2) ofthe Property
titles. aATEDS Registration Decree is founded on extraordinary prescription
The operation of the foregoing interpretation can be illustrated by under the Civil Code.
an actual example. Republic Act No. 7227, entitled "An Act It may be asked why the principles of prescription under the Civil
Accelerating The Conversion Of Military Reservations Into Other Code should not apply as well to Section 14 (1). Notwithstanding
Productive Uses, etc.", is more commonly known as the BCDA the vaunted status of the Civil Code, it ultimately is just
law. Section 2 of the law authorizes the sale of certain military one of numerous statutes, neither superior nor inferior to other
reservations and portions ofmilitary camps in Metro Manila, statutes such as the Property Registration Decree. The legislative
including Fort Bonifacio and Villamor Air Base. For branch is not bound to adhere to the framework set forth by the
purposes of effecting the sale of the military camps, the law Civil Code when it enacts subsequent legislation. Section 14 (2)
mandates the President to transfer such military lands to the manifests a clear intent to interrelate the registration allowed under
Bases Conversion Development Authority (BCDA) 40 which in that provision with the Civil Code, but no such intent exists with
turn is authorized to own, hold and/or administer them. 41 The respect to Section 14 (1).
President is authorized to sell portions of the military camps, in IV.
whole or in part. 42 Accordingly, the BCDA law itself declares that One of the keys to understanding the framework we set forth today
the military lands subject thereof are "alienable and disposable is seeing how our land registration procedures correlate with our
pursuant to the provisions of existing laws and regulations law on prescription, which, under the Civil Code, is one of the
governing sales of government properties." 43 modes for acquiring ownership over property.
From the moment the BCDA law was enacted the subject military The Civil Code makes it clear that patrimonial property of the State
lands have become alienable and disposable. However, said lands may be acquired by private persons through prescription. This is
did not become patrimonial, as the BCDA law itself expressly brought about by Article 1113, which states that "[a]ll things which
makes the reservation that these lands are to be sold in order to are within the commerce of man are susceptible to prescription",
raise funds for the conversion of the former American bases at and that [p]roperty of the State or any of its subdivisions not
Clark and Subic. 44 Such purpose can be tied to either "public patrimonial in character shall not be the object of prescription".
service" or "the development of national wealth" under Article 420 There are two modes of prescription through which immovables
(2). Thus, at that time, the lands remained property of the public may be acquired under the Civil Code. The first is ordinary
dominion under Article 420 (2), notwithstanding their status as acquisitive prescription, which, under Article 1117, requires
alienable and disposable. It is upon their sale as authorized under possession in good faith and with just title; and, under Article 1134,
the BCDA law to a private person or entity that such lands become is completed through possession of ten (10) years. There is
private property and cease to be property of the public dominion. nothing in the Civil Code that bars a person from acquiring
C. patrimonial property of the State through ordinary acquisitive
Should public domain lands become patrimonial because they are prescription, nor is there any apparent reason to impose such a
declared as such in a duly enacted law or duly promulgated rule. At the same time, there are indispensable requisites good
proclamation that they are no longer intended for public service or faith and just title. The ascertainment of good faith involves the
for the development of the national wealth, would the application of Articles 526, 527, and 528, as well as Article
period of possession prior to the conversion of such public 1127 of the Civil Code, 45 provisions that more or less speak for
dominion into patrimonial be reckoned in counting the prescriptive themselves.
period in favor of the possessors? We rule in the negative. On the other hand, the concept of just title requires some
The limitation imposed by Article 1113 dissuades us from ruling clarification. Under Article 1129, there is just title for the
that the period of possession before the public domain land purposes of prescription "when the adverse claimant came into
becomes patrimonial may be counted for the possession of the property through one of the modes recognized
purpose of completing the prescriptive period. by law for the acquisition of ownership or other real rights, but the
Possession of public dominion property before it becomes grantor was not the owner or could not transmit any right". Dr.
patrimonial cannot be the object of prescription according to the Tolentino explains: ITCcAD
Civil Code. As the application for registration under Section 14 (2) Just title is an act which has for its purpose the
falls wholly within the framework of prescription under the Civil transmission of ownership, and which would have actually
Code, there is no way that possession during the time that the land transferred ownership if the grantor had been the owner. This vice
was still classified as public dominion property can be counted to or defect is the one cured by prescription. Examples: sale with
meet the requisites of acquisitive prescription and justify delivery, exchange, donation, succession, and dacion in
registration. EHTSCD payment. 46
Are we being inconsistent in applying divergent rules for Section The OSG submits that the requirement of just title necessarily
14 (1) and Section 14 (2)? There is no inconsistency. Section 14 precludes the applicability of ordinary acquisitive prescription to
(1) mandates registration on the basis ofpossession, while patrimonial property. The major premise for the argument is that
Section 14 (2) entitles registration on the "the State, as the owner and grantor, could not transmit ownership
basis of prescription. Registration under Section 14 (1) is to the possessor before the completion of the required
extended under the aegis of the Property Registration period of possession". 47 It is evident that the OSG erred when it
Decree and the Public Land Act while registration under assumed that the grantor referred to in Article 1129 is the State.
Section 14 (2) is made available both by the Property The grantor is the one from whom the person invoking ordinary
Registration Decree and the Civil Code. acquisitive prescription derived the title, whether by sale,
In the same manner, we can distinguish between the thirty-year exchange, donation, succession or any other mode of the
period under Section 48 (b) of the Public Land Act, as amended acquisition of ownership or other real rights. SIEHcA
by Rep. Act No. 1472, and the thirty-year period available through
Section 14 (2) of the Property Registration Decree in relation to Earlier, we made it clear that, whether under ordinary prescription
Article 1137 of the Civil Code. The period under the former or extraordinary prescription, the period of possession preceding
speaks of a thirty-year period of possession, while the period the classification of public dominion lands as patrimonial cannot
under the latter concerns a thirty-year period of extraordinary be counted for the purpose of computing prescription. But after the
prescription. Registration under Section 48 (b) of the Public property has been become patrimonial, the period of prescription
Land Act as amended by Rep. Act No. 1472 is based on thirty begins to run in favor of the possessor. Once the requisite period
years of possession alone without regard to the Civil Code, has been completed, two legal events ensue: (1) the patrimonial
property is ipso jure converted into private land; and (2) the person least ten (10) years, in good faith and with just title. Under
in possession for the periods prescribed under the Civil Code extraordinary acquisitive prescription, a person's uninterrupted
acquires ownership of the property by operation of the Civil Code. adverse possession of patrimonial property for at least thirty (30)
It is evident that once the possessor automatically becomes the years, regardless of good faith or just title, ripens into ownership.
owner of the converted patrimonial property, the ideal next step is B.
the registration of the property under the Torrens system. It should We now apply the above-stated doctrines to the case at bar.
be remembered that registration of property is not a It is clear that the evidence of petitioners is insufficient to establish
mode of acquisition of ownership, but merely a that Malabanan has acquired ownership over the subject property
mode of confirmation of ownership. 48 under Section 48 (b) of the Public Land Act. There is no
Looking back at the registration regime prior to the substantive evidence to establish that Malabanan or petitioners as
adoption of the Property Registration Decree in 1977, it is his predecessors-in-interest have been in possession of the
apparent that the registration system then did not fully property since 12 June 1945 or earlier. The earliest that petitioners
accommodate the acquisition of ownership of patrimonial property can date back their possession, according to their own evidence
under the Civil Code. What the system accommodated was the the Tax Declarations they presented in particular is to the
confirmation of imperfect title brought about by the completion of a year 1948. Thus, they cannot avail themselves of registration
period of possession ordained under the Public Land Act (either under Section 14 (1) of the Property Registration
30 years following Rep. Act No. 1942, or since 12 June 1945 Decree. EaCDAT
following P.D. No. 1073). Neither can petitioners properly invoke Section 14 (2) as basis for
The Land Registration Act 49 was noticeably silent on the registration. While the subject property was declared as alienable
requisites for alienable public lands acquired through ordinary or disposable in 1982, there is no competent evidence that is no
prescription under the Civil Code, though it arguably did not longer intended for public use service or for the
preclude such registration. 50 Still, the gap was lamentable, development of the national evidence, conformably with Article
considering that the Civil Code, by itself, establishes ownership 422 of the Civil Code. The classification of the subject property as
over the patrimonial property ofpersons who have completed the alienable and disposable land of the public domain does not
prescriptive periods ordained therein. The gap was finally closed change its status as property of the public dominion under Article
with the adoption of the Property Registration Decree in 1977, 420 (2) ofthe Civil Code. Thus, it is insusceptible to acquisition by
with Section 14 (2) thereof expressly authorizing original prescription.
registration in favor of persons who have acquired ownership over VI.
private lands by prescription under the provisions of existing laws, A final word. The Court is comfortable with the correctness of the
that is, the Civil Code as of now. AcDaEH legal doctrines established in this decision. Nonetheless,
V. discomfiture over the implications of today's ruling cannot be
We synthesize the doctrines laid down in this case, as follows: discounted. For, every untitled property that is occupied in the
(1) In connection with Section 14 (1) of the Property Registration country will be affected by this ruling. The social implications
Decree, Section 48 (b) of the Public Land Act recognizes and cannot be dismissed lightly, and the Court would be abdicating its
confirms that "those who by themselves or through their social responsibility to the Filipino people if we simply levied the
predecessors in interest have been in open, continuous, exclusive, law without comment.
and notorious possession and occupation of alienable and The informal settlement of public lands, whether declared
disposable lands of the public domain, under a bona fide alienable or not, is a phenomenon tied to long-standing habit and
claim of acquisition of ownership, since June 12, 1945" have cultural acquiescence, and is common among the so-called "Third
acquired ownership of, and registrable title to, such lands based World" countries. This paradigm powerfully evokes the disconnect
on the length and quality of their possession. between a legal system and the reality on the ground. The law so
(a) Since Section 48 (b) merely requires possession since 12 June far has been unable to bridge that gap. Alternative
1945 and does not require that the lands should have been means of acquisition of these public domain lands, such as
alienable and disposable during the entire period of possession, through homestead or free patent, have proven unattractive due
the possessor is entitled to secure judicial confirmation of his title to limitations imposed on the grantee in the encumbrance or
thereto as soon as it is declared alienable and disposable, subject alienation of said properties. 52 Judicial confirmation of imperfect
to the timeframe imposed by Section 47 of the Public Land Act. 51 title has emerged as the most viable, if not the most attractive
(b) The right to register granted under Section 48 (b) of the Public means to regularize the informal settlement of alienable or
Land Act is further confirmed by Section 14 (1) of the Property disposable lands of the public domain, yet even that system, as
Registration Decree. revealed in this decision, has considerable limits.
(2) In complying with Section 14 (2) of the Property Registration There are millions upon millions of Filipinos who have individually
Decree, consider that under the Civil Code, prescription is or exclusively held residential lands on which they have lived and
recognized as a mode of acquiring ownership of patrimonial raised their families. Many more have tilled and made productive
property. However, public domain lands become only patrimonial idle lands of the State with their hands. They have been regarded
property not only with a declaration that these are alienable or for generation by their families and their communities as common
disposable. There must also be an express government law owners. There is much to be said about the
manifestation that the property is already patrimonial or no longer virtues of according them legitimate states. Yet such virtues are
retained for public service or the development of national wealth, not for the Court to translate into positive law, as the law itself
under Article 422 ofthe Civil Code. And only when the property has considered such lands as property of the public dominion. It could
become patrimonial can the prescriptive period for the only be up to Congress to set forth a new phase of land reform to
acquisition of property of the public dominion begin to run. sensibly regularize and formalize the settlement of such lands
(a) Patrimonial property is private property of the government. The which in legal theory are lands of the public domain before the
person acquires ownership of patrimonial property by prescription problem becomes insoluble. This could be accomplished, to cite
under the Civil Code is entitled to secure registration thereof under two examples, by liberalizing the standards for judicial
Section 14 (2) of the Property Registration Decree. confirmation of imperfect title, or amending the Civil Code itself to
(b) There are two kinds of prescription by which patrimonial ease the requisites for the conversion of public dominion property
property may be acquired, one ordinary and other extraordinary. into patrimonial.
Under ordinary acquisitive prescription, a person acquires One's sense of security over land rights infuses into every
ownership of a patrimonial property through possession for at aspect of well-being not only of that individual, but also to the
person's family. Once that sense of security is deprived, life and SO ORDERED. 3
livelihood are put on stasis. It is for the political branches to bring The Office of the Solicitor General (OSG) appealed the judgment
welcome closure to the long pestering problem. caHIAS to the CA, arguing that Malabanan had failed to prove that the
WHEREFORE, the Petition is DENIED. The Decision of the property belonged to the alienable and disposable land of the
Court of Appeals dated 23 February 2007 and Resolution dated 2 public domain, and that the RTC erred in finding that he had been
October 2007 are AFFIRMED. No pronouncement as to costs. in possession of the property in the manner and for the
SO ORDERED. length of time required by law for confirmation of imperfect title.
||| (Heirs of Malabanan v. Republic, G.R. No. 179987, [April 29, On February 23, 2007, the CA promulgated its decision reversing
2009], 605 PHIL 244-326) the RTC and dismissing the application for
registration of Malabanan. Citing the ruling in Republic v.
EN BANC Herbieto(Herbieto), 4 the CA declared that under Section 14
[G.R. No. 179987. September 3, 2013.] (1) of the Property Registration Decree, any period of possession
HEIRS OF MARIO MALABANAN (Represented by Sally prior to the classification of the land as alienable and disposable
A. Malabanan), petitioners, vs. REPUBLIC OF THE was inconsequential and should be excluded from the
PHILIPPINES, respondent. computation of the period of possession. Noting that the CENRO-
RESOLUTION DENR certification stated that the property had been declared
BERSAMIN, J p: alienable and disposable only on March 15, 1982, Velazco's
For our consideration and resolution are the motions for possession prior to March 15, 1982 could not be tacked for
reconsideration of the parties who both assail the decision purposes of computing Malabanan's period ofpossession.
promulgated on April 29, 2009, whereby we upheld the ruling ofthe Due to Malabanan's intervening demise during the appeal in the
Court of Appeals (CA) denying the application of the petitioners CA, his heirs elevated the CA's decision of February 23, 2007 to
for the registration of a parcel of land situated in Barangay Tibig, this Court through a petition for review on certiorari.
Silang, Cavite on the ground that they had not established by The petitioners assert that the ruling in Republic v.
sufficient evidence their right to the registration in accordance with Court of Appeals and Corazon Naguit 5 (Naguit) remains the
either Section 14 (1) or Section 14 (2) of Presidential Decree No. controlling doctrine especially if the property involved is
1529 (Property Registration Decree). SIcEHC agricultural land. In this regard, Naguit ruled that any
Antecedents possession of agricultural land prior to its declaration as alienable
The property subject of the application for registration is a and disposable could be counted in the reckoning of the
parcel of land situated in Barangay Tibig, Silang, Cavite, more period ofpossession to perfect title under the Public Land
particularly identified as Lot 9864-A, Cad-452-D, with an Act (Commonwealth Act No. 141) and the Property Registration
area of 71,324-square meters. On February 20, 1998, applicant Decree. They point out that the ruling in Herbieto, to the effect that
Mario Malabanan, who had purchased the property from Eduardo the declaration of the land subject of the application for
Velazco, filed an application for land registration covering the registration as alienable and disposable should also date back to
property in the Regional Trial Court (RTC) in Tagaytay City, June 12, 1945 or earlier, was a mere obiter dictumconsidering that
Cavite, claiming that the property formed part of the alienable and the land registration proceedings therein were in fact found and
disposable land of the public domain, and that he and his declared void ab initio for lack of publication of the notice of initial
predecessors-in-interest had been in open, continuous, hearing. AacCIT
uninterrupted, public and adverse possession and The petitioners also rely on the ruling in Republic v. T.A.N.
occupation of the land for more than 30 years, thereby entitling Properties, Inc. 6 to support their argument that the property had
him to the judicial confirmation of his title. 1 been ipso jure converted into private property by reason of the
To prove that the property was an alienable and disposable open, continuous, exclusive and notorious possession by their
land of the public domain, Malabanan presented during trial a predecessors-in-interest of an alienable land of the public domain
certification dated June 11, 2001 issued by the Community for more than 30 years. According to them, what was essential was
Environment and Natural Resources Office (CENRO) of the that the property had been "converted" into private property
Department of Environment and Natural Resources (DENR), through prescription at the time of the application without regard to
which reads: whether the property sought to be registered was previously
This is to certify that the parcel of land designated as Lot No. 9864 classified as agricultural land of the public domain.
Cad 452-D, Silang Cadastre as surveyed for Mr. Virgilio Velasco As earlier stated, we denied the petition for review
located at Barangay Tibig, Silang, Cavite containing an on certiorari because Malabanan failed to establish by sufficient
area of 249,734 sq. meters as shown and described on the Plan evidence possession and occupation of the property on his part
Ap-04-00952 is verified to be within the Alienable or Disposable and on the part of his predecessors-in interest since June 12,
land per Land Classification Map No. 3013 established under 1945, or earlier.
Project No. 20-A and approved as such under FAO 4-1656 on Petitioners' Motion for Reconsideration
March 15, 1982. 2 In their motion for reconsideration, the petitioners submit that the
After trial, on December 3, 2002, the RTC rendered judgment mere classification of the land as alienable or disposable should
granting Malabanan's application for land registration, disposing be deemed sufficient to convert it into patrimonial property of the
thusly: State. Relying on the rulings in Spouses de Ocampo v.
WHEREFORE, this Court hereby approves this application for Arlos, 7 Menguito v. Republic 8 and Republic v. T.A.N.
registration and thus places under the operation of Act 141, Act Properties, Inc., 9 they argue that the reclassification of the land
496 and/or P.D. 1529, otherwise known as Property Registration as alienable or disposable opened it to acquisitive prescription
Law, the lands described in Plan Csd-04-0173123-D, Lot 9864-A under the Civil Code; that Malabanan had purchased the property
and containing an area of Seventy One Thousand Three Hundred from Eduardo Velazco believing in good faith that Velazco and his
Twenty Four (71,324) Square Meters, as supported by its technical predecessors-in-interest had been the real owners of the land with
description now forming part of the record of this case, in addition the right to validly transmit title and ownership thereof; that
to other proofs adduced in the name of MARIO MALABANAN, consequently, the ten-year period prescribed by Article
who is oflegal age, Filipino, widower, and with residence at 1134 of the Civil Code, in relation to Section 14 (2) of the Property
Munting Ilog, Silang, Cavite. aDACcH Registration Decree, applied in their favor; and that
Once this Decision becomes final and executory, the when Malabanan filed the application for registration on February
corresponding decree of registration shall forthwith issue. 20, 1998, he had already been in possession of the land for almost
16 years reckoned from 1982, the time when the land was but with the limitation that the lands must only be agricultural.
declared alienable and disposable by the State. ASTcaE Consequently, lands classified as forest or timber, mineral, or
The Republic's Motion for Partial Reconsideration national parks are not susceptible of alienation or disposition
The Republic seeks the partial reconsideration in order to obtain a unless they are reclassified as agricultural. 24A positive act of the
clarification with reference to the application of the rulings Government is necessary to enable such reclassification, 25 and
in Naguit and Herbieto. the exclusive prerogative to classify public lands under existing
Chiefly citing the dissents, the Republic contends that the decision laws is vested in the Executive Department, not in the courts. 26 If,
has enlarged, by implication, the interpretation of Section 14 however, public land will be classified as neither agricultural, forest
(1) of the Property Registration Decree through judicial legislation. or timber, mineral or national park, or when public land is no longer
It reiterates its view that an applicant is entitled to registration only intended for public service or for the development of the national
when the land subject of the application had been declared wealth, thereby effectively removing the land from the
alienable and disposable since June 12, 1945 or earlier. ambit of public dominion, a declaration of such conversion must
Ruling be made in the form of a law duly enacted by Congress or by a
We deny the motions for reconsideration. Presidential proclamation in cases where the President is duly
In reviewing the assailed decision, we consider to be imperative to authorized by law to that effect. 27 Thus, until the Executive
discuss the different classifications of land in relation to the Department exercises its prerogative to classify or reclassify lands,
existing applicable land registration laws of the Philippines. or until Congress or the President declares that the State no longer
Classifications of land according to intends the land to be used for public service or for the
ownership development of national wealth, the Regalian Doctrine is
Land, which is an immovable property, 10 may be classified as applicable. cEaACD
either of public dominion or of private ownership. 11 Land is Disposition of alienable public lands
considered of public dominion if it either: (a) is intended for public Section 11 of the Public Land Act (CA No. 141) provides the
use; or (b) belongs to the State, without being for public use, and manner by which alienable and disposable lands of the public
is intended for some public service or for the development of the domain, i.e., agricultural lands, can be disposed of, to wit:
national wealth. 12 Land belonging to the State that is not of such Section 11. Public lands suitable for agricultural purposes can be
character, or although of such character but no longer intended for disposed of only as follows, and not otherwise:
public use or for public service forms part of the patrimonial (1) For homestead settlement;
property of the State. 13Land that is other than part of the (2) By sale;
patrimonial property of the State, provinces, cities and (3) By lease; and
municipalities is of private ownership if it belongs to a private (4) By confirmation of imperfect or incomplete titles:
individual. (a) By judicial legalization; or
Pursuant to the Regalian Doctrine (Jura Regalia), a legal concept (b) By administrative legalization (free patent).
first introduced into the country from the West by Spain through The core of the controversy herein lies in the proper
the Laws of the Indies and the Royal Cedulas, 14 all lands of the interpretation of Section 11 (4), in relation to Section 48
public domain belong to the State. 15 This means that the State is (b) of the Public Land Act, which expressly requires possession by
the source of any asserted right to ownership of land, and is a Filipino citizen of the land since June 12, 1945, or earlier, viz.:
charged with the conservation of such patrimony. 16 All lands not Section 48. The following-described citizens of the Philippines,
appearing to be clearly under private ownership are presumed to occupying lands of the public domain or claiming to own any such
belong to the State. Also, public lands remain part of the lands or an interest therein, but whose titles have not been
inalienable land of the public domain unless the State is shown to perfected or completed, may apply to the Court of First
have reclassified or alienated them to private Instance of the province where the land is located for
persons. 17 HCEcAa confirmation of their claims and the issuance of a certificate of title
Classifications of public lands thereafter, under the Land Registration Act, to wit:
according to alienability xxx xxx xxx
Whether or not land of the public domain is alienable and (b) Those who by themselves or through their predecessors-in-
disposable primarily rests on the classification of public lands interest have been in open, continuous, exclusive, and notorious
made under the Constitution. Under the 1935 possession and occupation of alienable and disposable
Constitution, 18 lands of the public domain were classified into lands of the public domain, under a bona
three, namely, agricultural, timber and mineral. 19 Section 10, fide claim of acquisition of ownership, since June 12, 1945, or
Article XIV of the 1973 Constitution classified lands of the public earlier, immediately preceding the filing of the applications for
domain into seven, specifically, agricultural, industrial or confirmation of title, except when prevented by war or force
commercial, residential, resettlement, mineral, timber or forest, majeure. These shall be conclusively presumed to have performed
and grazing land, with the reservation that the law might provide all the conditions essential to a Government grant and shall be
other classifications. The 1987 Constitution adopted the entitled to a certificate of title under the provisions of this chapter.
classification under the 1935 Constitution into agricultural, forest (Bold emphasis supplied) cDCEIA
or timber, and mineral, but added national parks. 20 Agricultural Note that Section 48 (b) of the Public Land Act used the
lands may be further classified by law according to the uses to words "lands of the public domain" or "alienable and disposable
which they may be devoted. 21 The identification of lands lands of the public domain" to clearly signify that lands otherwise
according to their legal classification is done exclusively by and classified, i.e., mineral, forest or timber, or national parks, and
through a positive act of the Executive Department. 22 lands of patrimonial or private ownership, are outside the
Based on the foregoing, the Constitution places a limit on the coverage of the Public Land Act. What the law does not include, it
type of public land that may be alienated. Under Section 2, Article excludes. The use of the descriptive phrase "alienable and
XII of the 1987 Constitution, only agricultural lands ofthe public disposable" further limits the coverage of Section 48 (b) to only the
domain may be alienated; all other natural resources may not be. agricultural lands of the public domain as set forth in Article XII,
Alienable and disposable lands of the State fall into two Section 2 of the 1987 Constitution. Bearing in mind such
categories, to wit: (a) patrimonial lands of the State, or those limitations under the Public Land Act, the applicant must satisfy
classified as lands of private ownership under Article the following requirements in order for his application to come
425 of the Civil Code, 23 without limitation; and (b) lands of the under Section 14 (1) of the Property Registration Decree, 28 to
public domain, or the public lands as provided by the Constitution, wit:
1. The applicant, by himself or through his predecessor-in-interest, State. The imperfect or incomplete title being confirmed under
has been in possession and occupation of the property Section 48 (b) of the Public Land Act is title that is acquired by
subject of the application; reason of the applicant's possession and occupation of the
2. The possession and occupation must be open, continuous, alienable and disposable agricultural land of the public domain.
exclusive, and notorious; Where all the necessary requirements for a grant by the
3. The possession and occupation must be under a bona Government are complied with through actual physical, open,
fide claim of acquisition of ownership; continuous, exclusive and public possession of an alienable and
4. The possession and occupation must have taken place since disposable land of the public domain, the possessor is deemed to
June 12, 1945, or earlier; and have acquired by operation of law not only a right to a grant, but a
5. The property subject of the application must be an agricultural grant by the Government, because it is not necessary that a
land of the public domain. certificate of title be issued in order that such a grant be
Taking into consideration that the Executive Department is vested sanctioned by the courts. 31
with the authority to classify lands of the public domain, Section 48 If one follows the dissent, the clear objective of the Public Land
(b) of the Public Land Act, in relation to Section 14 Act to adjudicate and quiet titles to unregistered lands in
(1) of theProperty Registration Decree, presupposes that the land favor of qualified Filipino citizens by reason of their occupation
subject of the application for registration must have been already and cultivation thereof for the number of years prescribed by
classified as agricultural land of the public domain in order for the law 32 will be defeated. Indeed, we should always bear in mind
provision to apply. Thus, absent proof that the land is already that such objective still prevails, as a fairly recent legislative
classified as agricultural land of the public domain, the Regalian development bears out, when Congress enacted legislation
Doctrine applies, and overcomes the presumption that the land is (Republic Act No. 10023) 33 in order to liberalize stringent
alienable and disposable as laid down in Section 48 requirements and procedures in the adjudication of alienable
(b) of the Public Land Act. However, emphasis is placed on the public land to qualified applicants, particularly residential lands,
requirement that the classification required by Section 48 subject to area limitations. 34
(b) of the Public Land Act is classification or reclassification of a On the other hand, if a public land is classified as no longer
public land as agricultural. HcaATE intended for public use or for the development of national wealth
The dissent stresses that the classification or by declaration of Congress or the President, thereby converting
reclassification of the land as alienable and disposable agricultural such land into patrimonial or private land of the State, the
land should likewise have been made on June 12, 1945 or earlier, applicable provision concerning disposition and registration is no
because any possession of the land prior to such classification or longer Section 48 (b) of thePublic Land Actbut the Civil Code, in
reclassification produced no legal effects. It observes that the fixed conjunction with Section 14 (2) of the Property Registration
date of June 12, 1945 could not be minimized or glossed over by Decree. 35 As such, prescription can now run against the State.
mere judicial interpretation or by judicial social policy concerns, To sum up, we now observe the following rules relative to the
and insisted that the full legislative intent be respected. disposition of public land or lands of the public domain,
We find, however, that the choice of June 12, 1945 as the namely: EaIDAT
reckoning point of the requisite possession and occupation was (1) As a general rule and pursuant to the Regalian Doctrine, all
the sole prerogative of Congress, the determination ofwhich lands of the public domain belong to the State and are inalienable.
should best be left to the wisdom of the lawmakers. Except that Lands that are not clearly under private ownership are also
said date qualified the period of possession and occupation, no presumed to belong to the State and, therefore, may not be
other legislative intent appears to be associated with the alienated or disposed;
fixing of the date of June 12, 1945. Accordingly, the Court should (2) The following are excepted from the general rule, to wit:
interpret only the plain and literal meaning of the law as written by (a) Agricultural lands of the public domain are rendered alienable
the legislators. and disposable through any of the exclusive modes enumerated
Moreover, an examination of Section 48 (b) of the Public Land under Section 11 of thePublic Land Act. If the mode is judicial
Act indicates that Congress prescribed no requirement that the confirmation of imperfect title under Section 48 (b) of the Public
land subject of the registration should have been classified as Land Act, the agricultural land subject of the application needs
agricultural since June 12, 1945, or earlier. As such, the applicant's only to be classified as alienable and disposable as of the
imperfect or incomplete title is derived only from possession and time of the application, provided the applicant's possession and
occupation since June 12, 1945, or earlier. This means that the occupation ofthe land dated back to June 12, 1945, or earlier.
character of the property subject of the application as alienable Thereby, a conclusive presumption that the applicant has
and disposable agricultural land of the public domain determines performed all the conditions essential to a government grant
its eligibility for land registration, not the ownership or title over it. arises, 36 and the applicant becomes the owner of the land by
Alienable public land held by a possessor, either personally or virtue of an imperfect or incomplete title. By legal fiction, the land
through his predecessors-in-interest, openly, continuously and has already ceased to be part of the public domain and has
exclusively during the prescribed statutory period is converted to become private property. 37
private property by the mere lapse or completion of the (b) Lands of the public domain subsequently classified or declared
period. 29 In fact, by virtue of this doctrine, corporations may now as no longer intended for public use or for the
acquire lands of the public domain for as long as the lands were development of national wealth are removed from the
already converted to private ownership, by operation of law, as a sphere of public dominion and are considered converted into
result of satisfying the requisite period ofpossession prescribed by patrimonial lands or lands of private ownership that may be
the Public Land Act. 30 It is for this reason that the property alienated or disposed through any of the modes of acquiring
subject of the application of Malabanan need not be classified as ownership under the Civil Code. If the mode of acquisition is
alienable and disposable agricultural land of the public domain for prescription, whether ordinary or extraordinary, proof that the land
the entire duration of the requisite period of possession. HaTDAE has been already converted to private ownership prior to the
To be clear, then, the requirement that the land should have been requisite acquisitive prescriptive period is a condition sine qua
classified as alienable and disposable agricultural land at the non in observance of the law (Article 1113, Civil Code) that
time of the application for registration is necessary only to dispute property of the State not patrimonial in character shall not be the
the presumption that the land is inalienable. object of prescription. HaSEcA
The declaration that land is alienable and disposable also serves To reiterate, then, the petitioners failed to present sufficient
to determine the point at which prescription may run against the evidence to establish that they and their predecessors-in-interest
had been in possession of the land since June 12, 1945. Without xxx xxx xxx
satisfying the requisite character and period of possession SECTION 3. No building or structure of any kind whether
possession and occupation that is open, continuous, exclusive, temporary or permanent shall be allowed to be set up, erected or
and notorious since June 12, 1945, or earlier the land cannot constructed on the beaches around the Island of Boracay and in
be considered ipso jure converted to private property even upon its offshore waters. During the conduct of special activities or
the subsequent declaration of it as alienable and disposable. special events, the Sangguniang Bayan may, through a
Prescription never began to run against the State, such that the Resolution, authorize the Office of the Mayor to issue Special
land has remained ineligible for registration under Section 14 Permits for construction of temporary structures on the beach for
(1) of the Property Registration Decree. Likewise, the land the duration of the special activity as embodied in the Resolution.
continues to be ineligible for land registration under Section 14 In due time, petitioner appealed the denial action to the
(2) of the Property Registration Decree unless Congress enacts a Office of the Mayor on February 1, 2010. TAacHE
law or the President issues a proclamation declaring the land as On May 13, 2010, petitioner followed up his appeal through a letter
no longer intended for public service or for the development of the but no action was ever taken by the respondent mayor. On April 5,
national wealth. 2011, however, a Notice of Assessment was sent to petitioner
WHEREFORE, the Court DENIES the petitioners' Motion for asking for the settlement of Boracay West Cove's unpaid taxes
Reconsideration and the respondent's Partial Motion for and other liabilities under pain of a recommendation for closure in
Reconsideration for their lack of merit. view of its continuous commercial operation since 2009 sans the
SO ORDERED. necessary zoning clearance, building permit, and business and
||| (Heirs of Malabanan v. Republic, G.R. No. 179987, [September mayor's permit. In reply, petitioner expressed willingness to settle
3, 2013], 717 PHIL 141-209) the company's obligations, but the municipal treasurer refused to
accept the tendered payment. Meanwhile, petitioner continued
AQUINO v. MUNICIPALITY OF MALAY with the construction, expansion, and operation of the resort hotel.
THIRD DIVISION Subsequently, on March 28, 2011, a Cease and Desist Order was
[G.R. No. 211356. September 29, 2014.] issued by the municipal government, enjoining the
CRISOSTOMO expansion of the resort, and on June 7, 2011, the Office of the
B. AQUINO, petitioner, vs. MUNICIPALITY OF MALAY, Mayor of Malay, Aklan issued the assailed EO 10, ordering the
AKLAN, represented by HON. MAYOR JOHN P. YAP, closure and demolition of Boracay West Cove's hotel.
SANGGUNIANG BAYAN OF MALAY, AKLAN, represented by EO 10 was partially implemented on June 10, 2011. Thereafter,
HON. EZEL FLORES, DANTE PASUGUIRON, ROWEN two more instances followed wherein respondents demolished the
AGUIRRE, WILBEC GELITO, JUPITER GALLENERO, improvements introduced by Boracay West Cove, the most
OFFICE OF THE MUNICIPAL ENGINEER, OFFICE OF THE recent of which was made in February 2014. caCSDT
MUNICIPAL TREASURER, BORACAY PNP CHIEF, BORACAY Alleging that the order was issued and executed with grave
FOUNDATION, INC., represented by NENETTE GRAF, abuse of discretion, petitioner filed a Petition for Certiorari with
MUNICIPAL AUXILIARY POLICE, and JOHN and JANE prayer for injunctive relief with the CA. He argued that judicial
DOES, respondents. proceedings should first be conducted before the respondent
DECISION mayor could order the demolition of the company's establishment;
VELASCO, JR., J p: that Boracay West Cove was granted a FLAgT by the DENR,
Nature of the Case which bestowed the company the right to construct permanent
Before the Court is a Petition for Review on Certiorari challenging improvements on the area in question; that since the area is a
the Decision 1 and the Resolution of the Court of Appeals (CA) in forestland, it is the DENR and not the municipality of Malay, or
CA-G.R. SP No. 120042 dated August 13, 2013 and February 3, any other local government unit for that matter that has primary
2014, respectively. The assailed rulings denied jurisdiction over the area, and that the Regional Executive
Crisostomo Aquino's Petition for Certiorari for not being the proper Director of DENR-Region 6 had officially issued an opinion
remedy to question the issuance and implementation of Executive regarding the legal issues involved in the present case; that the
Order No. 10, Series of 2011 (EO 10), ordering the Ordinance admits of exceptions; and lastly, that it is the mayor
demolition of his hotel establishment. who should be blamed for not issuing the necessary clearances in
The Facts the company's favor.
Petitioner is the president and chief executive officer of Boracay In rebuttal, respondents contended that the FLAgT does not
Island West Cove Management Philippines, Inc. (Boracay West excuse the company from complying with the Ordinance
Cove). On January 7, 2010, the company applied for a zoning and Presidential Decree No. 1096 (PD 1096), otherwise known as
compliance with the municipal government of Malay, the National Building Code of the Philippines. Respondents also
Aklan. 2 While the company was already operating a resort in the argued that the demolition needed no court order because the
area, the application sought the issuance of a building permit municipal mayor has the express power under the Local
covering the construction of a three-storey hotel over a Government Code (LGC)to order the removal of illegally
parcel of land measuring 998 sq.m. located in Sitio Diniwid, constructed buildings.
Barangay Balagab, Boracay Island, Malay, Aklan, which is Ruling of the Court of Appeals
covered by a Forest Land Use Agreement for Tourism Purposes In its assailed Decision dated August 13, 2013, the CA dismissed
(FLAgT) issued by the Department of Environment and Natural the petition solely on procedural ground, i.e., the special
Resources (DENR) in favor of Boracay West Cove. writ of certiorari can only be directed against a tribunal, board, or
Through a Decision on Zoning dated January 20, 2010, the officer exercising judicial or quasi-judicial functions and since the
Municipal Zoning Administrator denied petitioner's application on issuance of EO 10 was done in the exercise of executive
the ground that the proposed construction site was within the "no functions, and not of judicial or quasi-judicial
build zone" demarcated in Municipal Ordinance 2000-131 functions, certiorari will not lie. Instead, the proper remedy for the
(Ordinance). 3 As provided in the Ordinance: petitioner, according to the CA, is to file a petition for declaratory
SECTION 2. Definition of Terms. As used in this Ordinance, relief with the Regional Trial Court.
the following words, terms and phrases shall mean as follows: Petitioner sought reconsideration but this was denied by the CA
xxx xxx xxx on February 3, 2014 through the challenged Resolution. Hence,
(b) No Build Zone the space twenty-five (25) meters from the the instant petition raising arguments on both procedure and
edge of the mean high water mark measured inland; substance.
The Issues certainty and praying that judgment be rendered annulling or
Stripped to the essentials, the pivotal issues in the extant case are modifying the proceedings of such tribunal, board or officer, and
as follows: granting such incidental reliefs as law and justice may require. . . .
1. The propriety under the premises of the filing of a petition For certiorari to prosper, the petitioner must establish the
for certiorari instead of a petition for declaratory relief; concurrence of the following requisites, namely:
a. Whether or not declaratory relief is still available to petitioner; 1. The writ is directed against a tribunal, board, or officer
b. Whether or not the CA correctly ruled that the respondent mayor exercising judicial or quasi-judicial functions;
was performing neither a judicial nor quasi-judicial function when 2. Such tribunal, board, or officer has acted without or in
he ordered the closure and demolition of Boracay West Cove's excess of jurisdiction, or with grave abuse of discretion amounting
hotel; to lack or excess of jurisdiction; and
2. Whether or not respondent mayor committed grave 3. There is no appeal or any plain speedy, and adequate remedy
abuse of discretion when he issued EO 10; in the ordinary course of law. 5
a. Whether or not petitioner's right to due process was violated Guilty of reiteration, the CA immediately dismissed the Petition
when the respondent mayor ordered the closure and for Certiorari upon determining that the first element is wanting
demolition of Boracay West Cove's hotel without first conducting that respondent mayor was allegedly not exercising judicial or
judicial proceedings; quasi-judicial functions when he issued EO 10.
b. Whether or not the LGU's refusal to issue petitioner the We are not persuaded.
necessary building permit and clearances was justified; The CA fell into a trap when it ruled that a mayor, an officer from
c. Whether or not petitioner's rights under the FLAgT prevail over the executive department, exercises an executive function
the municipal ordinance providing for a no-build zone; and whenever he issues an Executive Order. This is tad too
d. Whether or not the DENR has primary jurisdiction over the presumptive for it is the nature of the act to be performed, rather
controversy, not the LGU. than of the office, board, or body which performs it, that
The Court's Ruling determines whether or not a particular act is a discharge of judicial
We deny the petition. or quasi-judicial functions. The first requirement for certiorari is
Certiorari, not declaratory relief, is the proper remedy satisfied if the officers act judicially in making their decision,
a. Declaratory relief no longer viable whatever may be their public character. 6
Resolving first the procedural aspect of the case, We find merit in It is not essential that the challenged proceedings should be strictly
petitioner's contention that the special writ of certiorari, and not and technically judicial, in the sense in which that word is used
declaratory relief, is the proper remedy for assailing EO 10. As when applied to courts of justice, but it is sufficient if they are
provided under Sec. 1, Rule 63 of the Rules of Court: SIcEHC quasi-judicial. 7 To contrast, a party is said to be exercising
SECTION 1. Who may file petition. Any person interested a judicial function where he has the power to determine what the
under a deed, will, contract or other written instrument, whose law is and what legal rights of the parties are, and then undertakes
rights are affected by a statute, executive order or regulation, to determine these questions and adjudicate upon the rights of the
ordinance or any other governmental regulation may, before parties, whereas quasi-judicial function is "a term which applies to
breach or violation thereof, bring an action in the appropriate the actions, discretion, etc., of public administrative officers or
Regional Trial Court to determine any question of construction or bodies . . . required to investigate facts or ascertain the
validity arising, and for a declaration of his rights or duties, existence of facts, hold hearings, and draw conclusions from them
thereunder. . . . (emphasis added) as a basis for their official action and to exercise discretion of a
An action for declaratory relief presupposes that there has been judicial nature." 8
no actual breach of the instruments involved or of the rights In the case at bench, the assailed EO 10 was issued upon the
arising thereunder. Since the purpose of an action for declaratory respondent mayor's finding that Boracay West Cove's
relief is to secure an authoritative statement of the rights and construction, expansion, and operation of its hotel in Malay, Aklan
obligations of the parties under a statute, deed, or contract for their is illegal. Such a finding of illegality required the respondent
guidance in the enforcement thereof, or compliance therewith, and mayor's exercise of quasi-judicial functions, against which the
not to settle issues arising from an alleged breach thereof, it may special writ of certiorari may lie. Apropos hereto is Our ruling
be entertained before the breach or violation of the statute, deed in City Engineer of Baguio v. Baniqued: 9
or contract to which it refers. A petition for declaratory relief gives There is no gainsaying that a city mayor is an executive official nor
a practical remedy for ending controversies that have not reached is the matter of issuing demolition notices or orders not a
the state where another relief is immediately available; and ministerial one. In determining whether or not a structure is illegal
supplies the need for a form of action that will set controversies at or it should be demolished, property rights are involved thereby
rest before they lead to a repudiation of obligations, an needing notices and opportunity to be heard as provided for in the
invasion of rights, and a commission of wrongs. 4 constitutionally guaranteed right of due process. In
In the case at bar, the petition for declaratory relief became pursuit of these functions, the city mayor has to exercise quasi-
unavailable by EO 10's enforcement and implementation. The judicial powers.
closure and demolition of the hotel rendered futile any possible With the foregoing discussion, the CA erred in ruling that the
guidelines that may be issued by the trial court for carrying out the respondent mayor was merely exercising his executive functions,
directives in the challenged EO 10. Indubitably, the CA erred when for clearly, the first requisite for the special writ has been satisfied.
it ruled that declaratory relief is the proper remedy given such a Aside from the first requisite, We likewise hold that the third
situation. element, i.e., the unavailability of a plain, speedy, or adequate
b. Petitioner correctly resorted to certiorari remedy, is also present herein. While it may be argued that, under
On the propriety of filing a petition for certiorari, Sec. 1, Rule the LGC,Executive Orders issued by mayors are subject to review
65 of the Rules of Court provides: by provincial governors, 10 this cannot be considered as an
Section 1. Petition for certiorari. When any tribunal, board or adequate remedy given the exigencies ofpetitioner's predicament.
officer exercising judicial or quasi-judicial functions has acted In a litany of cases, We have held that it is inadequacy, not the
without or in excess of its or his jurisdiction, or with grave mere absence of all other legal remedies and the
abuse of discretion amounting to lack or excess of jurisdiction, danger of failure of justice without the writ, that must usually
and there is no appeal, or any plain, speedy, and adequate remedy determine the propriety of certiorari. A remedy is plain, speedy and
in the ordinary course of law, a person aggrieved thereby may file adequate if it will promptly relieve the petitioner from the injurious
a verified petition in the proper court, alleging the facts with effects of the judgment, order, or resolution of the lower court or
agency. It is understood, then, that a litigant need not mark time nuisance. Otherwise stated, had it not been constructed in the no
by resorting to the less speedy remedy of appeal in order to have build zone, Boracay West Cove could have secured the necessary
an order annulled and set aside for being patently void for permits without issue. As such, petitioner is correct that the hotel
failure of the trial court to comply with the Rules of Court. 11 is not a nuisance per se, but to Our mind, it is still a nuisance per
Before applying this doctrine, it must first be borne in mind that accidens.
respondents in this case have already taken measures towards b. Respondent mayor has the power to order the
implementing EO 10. In fact, substantial segments ofthe hotel demolition of illegal constructions
have already been demolished pursuant to the mayor's directive. Generally, LGUs have no power to declare a particular thing as a
It is then understandable why petitioner prayed for the nuisance unless such a thing is a nuisance per se. 16 So it was
issuance of an injunctive writ a provisional remedy that would held in AC Enterprises v. Frabelle Properties Corp.: 17
otherwise have been unavailable had he sought a reversal from We agree with petitioner's contention that, under Section
the office of the provincial governor of Aklan. Evidently, petitioner 447(a)(3)(i) of R.A. No. 7160, otherwise known as the Local
correctly saw the urgent need for judicial intervention via certiorari. Government Code, the Sangguniang Panglungsod is empowered
In light of the foregoing, the CA should have proceeded to grab the to enact ordinances declaring, preventing or abating noise and
bull by its horns and determine the existence of the second other forms of nuisance. It bears stressing, however, that the
element of certiorari whether or not there was grave Sangguniang Bayan cannot declare a particular thing as a
abuse of discretion on the part of respondents. nuisance per se and order its condemnation. It does not have the
Upon Our finding that a petition for certiorari under Rule 65 is the power to find, as a fact, that a particular thing is a nuisance
appropriate remedy, We will proceed to resolve the core issues in when such thing is not a nuisance per se; nor can it authorize
view of the urgency of the reliefs prayed for in the petition. the extrajudicial condemnation and destruction of that as a
Respondents did not commit grave abuse of discretion nuisance which in its nature, situation or use is not such.
a. The hotel's classification as a nuisance Those things must be determined and resolved in the
Article 694 of the Civil Code defines "nuisance" as any act, ordinary courts of law. If a thing, be in fact, a nuisance due to
omission, establishment, business, condition or property, or the manner of its operation, that question cannot be determined
anything else that (1) injures or endangers the health or by a mere resolution of the Sangguniang Bayan. (emphasis
safety of others; (2) annoys or offends the senses; (3) shocks, supplied)
defies or disregards decency or morality; (4) obstructs or interferes Despite the hotel's classification as a nuisance per accidens,
with the free passage of any public highway or street, or any however, We still find in this case that the LGU may nevertheless
body of water; or (5) hinders or impairs the use of property. 12 properly order the hotel's demolition. This is because, in the
In establishing a no build zone through local legislation, the LGU exercise of police power and the general welfare
effectively made a determination that constructions therein, clause, 18 property rights of individuals may be subjected to
without first securing exemptions from the local council, qualify as restraints and burdens in order to fulfil the objectives of the
nuisances for they pose a threat to public safety. No build zones government. Otherwise stated, the government may enact
are intended for the protection of the public because the legislation that may interfere with personal liberty, property, lawful
stability of the ground's foundation is adversely affected by the businesses and occupations to promote the general welfare. 19
nearby body of water. The ever present threat of high rising storm One such piece of legislation is the LGC,which authorizes city and
surges also justifies the ban on permanent constructions near the municipal governments, acting through their local chief executives,
shoreline. Indeed, the area's exposure to potential geo-hazards to issue demolition orders. Under existing laws, the office of the
cannot be ignored and ample protection to the residents of Malay, mayor is given powers not only relative to its function as the
Aklan should be afforded. executive official of the town; it has also been endowed with
Challenging the validity of the public respondents' actuations, authority to hear issues involving property rights of individuals and
petitioner posits that the hotel cannot summarily be abated to come out with an effective order or resolution
because it is not a nuisance per se, given the hundred million thereon. 20 Pertinent herein is Sec. 444 (b) (3)
peso-worth of capital infused in the venture. Citing Asilo, Jr. v. (vi) of the LGC,which empowered the mayor to order the closure
People, 13 petitioner also argues that respondents should have and removal of illegally constructed establishments for failing to
first secured a court order before proceeding with the secure the necessary permits, to wit:
demolition. SDTIaE Section 444. The Chief Executive: Powers, Duties, Functions and
Preliminarily, We agree with petitioner's posture that the property Compensation.
involved cannot be classified as a nuisance per se, but not for the xxx xxx xxx
reason he so offers. Property valuation, after all, is not the litmus (b) For efficient, effective and economical governance the
test for such a determination. More controlling is the property's purpose of which is the general welfare of the municipality and its
nature and conditions, which should be evaluated to see if it inhabitants pursuant to Section 16 of this Code, the municipal
qualifies as a nuisance as defined under the law. mayor shall:
As jurisprudence elucidates, nuisances are of two kinds: xxx xxx xxx
nuisance per se and nuisance per accidens. The first is (3) Initiate and maximize the generation of resources and
recognized as a nuisance under any and all circumstances, revenues, and apply the same to the
because it constitutes a direct menace to public health or safety, implementation of development plans, program objectives and
and, for that reason, may be abated summarily under the priorities as provided for under Section 18 of this Code, particularly
undefined law of necessity. The second is that which depends those resources and revenues programmed for agro-industrial
upon certain conditions and circumstances, and its existence development and country-wide growth and progress, and relative
being a question of fact, it cannot be abated without due hearing thereto, shall:
thereon in a tribunal authorized to decide whether such a thing xxx xxx xxx
does in law constitute a nuisance. 14 (vi) Require owners of illegally constructed houses, buildings
In the case at bar, the hotel, in itself, cannot be considered as a or other structures to obtain the necessary permit, subject to
nuisance per se since this type of nuisance is generally defined as such fines and penalties as may be imposed by law or
an act, occupation, or structure, which is a nuisance at all ordinance, or to make necessary changes in the
times and under any circumstances, regardless of location or construction of the same when said construction violates any
surrounding. 15 Here, it is merely the hotel's particular incident law or ordinance, or to order the demolition or removal of said
its location and not its inherent qualities that rendered it a
house, building or structure within the period prescribed by petitioner would be for the respondent mayor to decide, for
law or ordinance. (emphasis supplied) while mandamus may be invoked to compel the
c. Requirements for the exercise of the power are present exercise of discretion, it cannot compel such discretion to be
i. Illegality of structures exercised in a particular way. 21 What would have been important
In the case at bar, petitioner admittedly failed to secure the was for the respondent mayor to immediately resolve the case for
necessary permits, clearances, and exemptions before the petitioner to be able to go through the motions that the zoning
construction, expansion, and operation of Boracay Wet Cove's clearance application process entailed.
hotel in Malay, Aklan. To recall, petitioner declared that the Alas, petitioner opted to defy the zoning administrator's ruling. He
application for zoning compliance was still pending with the consciously chose to violate not only the Ordinance but also Sec.
office of the mayor even though construction and operation were 301 of PD 1096, laying down the requirement ofbuilding permits,
already ongoing at the same time. As such, it could no longer be which provides:
denied that petitioner openly violated Municipal Ordinance 2000- Section 301. Building Permits. No person, firm or corporation,
131, which provides: including any agency or instrumentality of the government shall
SECTION 9. Permits and Clearances. erect, construct, alter, repair, move, convert or demolish any
(a) No building or structure shall be allowed to start building or structure or cause the same to be done without first
construction unless a Building Permit therefore has been obtaining a building permit therefor from the Building Official
duly issued by the Office of the Municipal Engineer. Once assigned in the place where the subject building is located or the
issued, the building owner or any person in charge of the building work is to be done.
construction shall display on the lot or on the building undergoing This twin violation of law and ordinance warranted the LGU's
construction a placard containing the Building Permit Number and invocation of Sec. 444 (b) (3) (vi) of the LGC,which power is
the date of its issue. The office of the Municipal Engineer shall separate and distinct from the power to summarily abate
not issue any building permit unless: nuisances per se. Under the law, insofar as illegal constructions
1. The proposed construction has been duly issued a Zoning are concerned, the mayor can, after satisfying the
Clearance by the Office of the Municipal Zoning Officer; requirement of due notice and hearing, order their closure and
2. The proposed construction has been duly endorsed by the demolition.
Sangguniang Bayan through a Letter of Endorsement. ii. Observance of procedural due process rights
(b) Only buildings/structures which has complied with all the In the case at bench, the due process requirement is deemed to
requirements for its construction as verified to by the Building have been sufficiently complied with. First, basic is the rule that
Inspector and the Sangguniang Bayan shall be issued a public officers enjoy the presumption of regularity in the
Certificate of Occupancy by the Office of the Municipal Engineer. performance of their duties. 22 The burden is on the petitioner
(c) No Business or Mayor's Permit shall be issued to herein to prove that Boracay West Cove was deprived of the
businesses being undertaken on buildings or structures opportunity to be heard before EO 10 was issued. Regrettably,
which were not issued a certificate of Occupancy beginning copies of the Cease and Desist Order issued by the LGU
January 2001 and thereafter. and of the assailed EO 10 itself were never attached to the petition
xxx xxx xxx before this Court, which documents could have readily shed light
SECTION 10. Penalties. on whether or not petitioner has been accorded the 10-day grace
xxx xxx xxx period provided in Section 10 of the Ordinance. In view of this fact,
(e) Any building, structure, or contraption erected in any public the presumption ofregularity must be sustained. Second, as
place within the Municipality of Malay such as but not limited to quoted by petitioner in his petition before the CA, the assailed EO
streets, thoroughfares, sidewalks, plazas, beaches or in any other 10 states that petitioner received notices from
public place are hereby declared as nuisance and illegal the municipalitygovernment on March 7 and 28, 2011, requiring
structure. Such building structure or contraption shall be Boracay West Cove to comply with the zoning ordinance and yet
demolished by the owner thereof or any of his authorized it failed to do so. 23 If such was the case, the grace period can be
representative within ten (10) days from receipt of the notice deemed observed and the establishment was already ripe for
to demolish. Failure or refusal on the part of the owner or closure and demolition by the time EO 10 was issued in
any of his authorized representative to demolish the illegal June. Third, the observance of the 10-day allowance for the owner
structure within the period herein above specified shall to demolish the hotel was never questioned by petitioner so there
automatically authorize the is no need to discuss the same. Verily, the only grounds invoked
government of the Municipality of Malayto demolish the by petitioner in crying due process violation are (1) the
same, gather and keep the construction materials of the absence of a court order prior to demolition and (2) the municipal
demolished structure. (emphasis supplied) CTcSIA government's exercise of jurisdiction over the controversy
Petitioner cannot justify his position by passing the blame onto the instead of the DENR. Therefore, it can no longer be belatedly
respondent mayor and the latter's failure to act on his appeal for argued that the 10-day grace period was not observed because to
this does not, in any way, imply that petitioner can proceed with entertain the same would result in the violation of the respondents'
his infrastructure projects. On the contrary, this only means that own due process rights.
the decision of the zoning administrator denying the Given the presence of the requirements under Sec. 444 (b) (3)
application still stands and that petitioner acquired no right (vi) of the LGC,whether the building constituted a nuisance per
to construct on the no build zone. The illegality of the se or a nuisance per accidens becomes immaterial. The hotel was
construction cannot be cured by merely tendering payment for the demolished not exactly because it is a nuisance but because it
necessary fees and permits since the LGU's refusal rests on valid failed to comply with the legal requirements prior to construction.
grounds. It just so happened that, in the case at bar, the hotel's incident that
Instead of taking the law into his own hands, petitioner could have qualified it as a nuisance per accidens its being constructed
filed, as an alternative, a petition for mandamus to compel the within the no build zone further resulted in the non-
respondent mayor to exercise discretion and resolve the issuance of the necessary permits and clearances, which is a
controversy pending before his office. There is indeed an ground for demolition under the LGC.Under the premises, a court
exception to the rule that matters involving judgment and order that is required under normal circumstances is hereby
discretion are beyond the reach of a writ ofmandamus, for such dispensed with.
writ may be issued to compel action in those matters, when d. The FLAgT cannot prevail over the municipal ordinance
refused. Whether or not the decision would be for or against and PD 1096
Petitioner next directs our attention to the following FLAgT agreement cannot and will not amend or change the law because
provision: a legislative act cannot be altered by mere contractual agreement.
VII. The SECOND PARTY may construct permanent and/or Hence, petitioner has no valid reason for its failure to secure a
temporary improvements or infrastructure in the FLAgT Area building permit pursuant to Sec. 301 of the National Building
necessary and appropriate for its development for tourism Code.
purposes pursuant to the approved SMP. "Permanent e. The DENR does not have primary jurisdiction over the
Improvements" refer to access roads, and buildings or structures controversy
which adhere to the ground in a fixed and permanent manner. On Lastly, in ascribing grave abuse of discretion on the part of the
the other hand, "Temporary Improvements" include those which respondent mayor, petitioner argued that the hotel site is a
are detachable from the foundation or the ground introduced by forestland under the primary jurisdiction of the DENR. As such, the
the SECOND PARTY in the FLAgT Area and which the SECOND merits of the case should have been passed upon by the agency
PARTY may remove or dismantle upon expiration or and not by the LGU. In the alternative, petitioner explains that even
cancellation of this AGREEMENT . . . . 24 if jurisdiction over the matter has been devolved in favor of the
Taken in conjunction with the exceptions laid down in Sections 6 LGU, the DENR still has the power of review and supervision over
and 8 of the Ordinance, petitioner argues that Boracay West Cove the former's rulings. As cited by the petitioner, the LGC reads:
is exempted from securing permits from the LGU. Said exceptions Section 17. Basic Services and Facilities.
read: xxx xxx xxx
SECTION 6. No building or structure shall be allowed to be (b) Such basic services and facilities include, but are not limited to,
constructed on a slope Twenty Five Percent (25%) or higher the following:
unless provided with soil erosion protective structures and xxx xxx xxx
authorized by the Department of Environment and Natural (2) For a Municipality:
Resources. xxx xxx xxx
xxx xxx xxx (ii) Pursuant to national policies and subject to supervision,
SECTION 8. No building or structure shall be allowed to be control and review of the DENR, implementation of community-
constructed on a swamp or other water-clogged areas unless based forestry projects which include integrated social forestry
authorized by the Department of Environment and Natural programs and similar projects; management and
Resources. control of communal forests with an area not exceeding fifty (50)
According to petitioner, the fact that it was issued a FLAgT square kilometers; establishment of tree parks, greenbelts, and
constitutes sufficient authorization from the DENR to proceed with similar forest development projects. (emphasis added)
the construction of the three-storey hotel. Petitioner has made much of the fact that in line with this provision,
The argument does not persuade. the DENR Region 6 had issued an opinion favourable to
The rights granted to petitioner under the FLAgT are not unbridled. petitioner. 25 To petitioner, the adverted opinion effectively
Forestlands, although under the management of the DENR, are reversed the findings of the respondent mayor that the structure
not exempt from the territorial application ofmunicipal laws, for introduced was illegally constructed.
local government units legitimately exercise their We disagree. SHTcDE
powers of government over their defined territorial In alleging that the case concerns the development and the proper
jurisdiction. SITCEA use of the country's environment and natural resources, petitioner
Furthermore, the conditions set forth in the FLAgT and the is skirting the principal issue, which is Boracay West Cove's non-
limitations circumscribed in the ordinance are not mutually compliance with the permit, clearance, and zoning requirements
exclusive and are, in fact, cumulative. As sourced from Sec. 447 for building constructions under national and municipal laws. He
(a) (5) (i) of the LGC: downplays Boracay West Cove's omission in a bid to justify
Section 447. Powers, Duties, Functions and Compensation. ousting the LGU of jurisdiction over the case and transferring the
(a) The sangguniang bayan, as the legislative same to the DENR. He attempts to blow the issue out of proportion
body of the municipality, shall enact ordinances, approve when it all boils down to whether or not the construction of the
resolutions and appropriate funds for the general three-storey hotel was supported by the necessary documentary
welfare of the municipality and its inhabitants pursuant to Section requirements.
16 of this Code and in the proper exercise of the corporate Based on law and jurisprudence, the office of the mayor has quasi-
powers of the municipality as provided for under Section 22 of this judicial powers to order the closing and
Code, and shall: demolition of establishments. This power granted by the LGC,as
xxx xxx xxx earlier explained, We believe, is not the same power devolved in
(5) Approve ordinances which shall ensure the efficient and favor of the LGU under Sec. 17 (b) (2) (ii), as above-quoted, which
effective delivery of the basic services and facilities as provided for is subject to review by the DENR. The fact that the building to be
under Section 17 of this Code, and in addition to said services and demolished is located within a forestland under the
facilities, shall: administration of the DENR is of no moment, for what is involved
(i) Provide for the establishment, maintenance, protection, herein, strictly speaking, is not an issue on environmental
and conservation of communal forests and watersheds, tree protection, conservation of natural resources, and the
parks, greenbelts, mangroves, and other similar forest maintenance of ecological balance, but the legality or
development projects . . . . (emphasis added) illegality of the structure. Rather than treating this as an
Thus, aside from complying with the provisions in the FLAgT environmental issue then, focus should not be diverted from the
granted by the DENR, it was incumbent on petitioner to likewise root cause of this debacle compliance.
comply with the no build zone restriction under Municipal Ultimately, the purported power of review by a regional
Ordinance 2000-131, which was already in force even before the office of the DENR over respondents' actions exercised through
FLAgT was entered into. On this point, it is well to stress that an instrumentality of an ex-parte opinion, in this case, finds no
Sections 6 and 8 of the Ordinance do not exempt petitioner from sufficient basis. At best, the legal opinion rendered, though
complying with the restrictions since these provisions adverted to perhaps informative, is not conclusive on the courts and should be
grant exemptions from the ban on constructions on slopes and taken with a grain of salt.
swamps, not on the no build zone. WHEREFORE, in view of the foregoing, the petition is
Additionally, the FLAgT does not excuse petitioner from complying hereby DENIED for lack of merit. The Decision and the
with PD 1096. As correctly pointed out by respondents, the Resolution of the Court of Appeals in CA-G.R. SP No. 120042
dated August 13, 2013 and February 3, 2014, respectively, are heeded the barangay officials' efforts to pacify them and when the
hereby AFFIRMED. basketball ring was once padlocked, such was just removed at will
SO ORDERED. while members of the complainants' club continued playing.
||| (Aquino v. Municipality of Malay, Aklan, G.R. No. 211356, When Cruz asked for the PHC to return the steel bar and padlock,
[September 29, 2014], 744 PHIL 497-525) the request was simply ignored, thus, prompting her to order
Dela Cruz to destroy the basketball ring. The destruction was
CRUZ v. PANDACAN HIKERS CLUB allegedly also a response to the ongoing clamor of residents to
THIRD DIVISION stop the basketball games. 8 Cruz denied allegations that she
[G.R. No. 188213. January 11, 2016.] shouted invectives at the PHC members. In support of her
NATIVIDAD C. CRUZ and BENJAMIN answer, Cruz attached copies of the complaints, a "certification"
DELA CRUZ, petitioners, vs. PANDACAN HIKER'S CLUB, and letters of barangay residents asking for a solution to the
INC., Represented by its President, PRISCILA problems arising from the disruptive activities on the said playing
ILAO, respondent. venue. 9
DECISION After the parties' submission of their respective Position
PERALTA, J p: Papers, 10 the Office of the Ombudsman rendered its
Before the Court is a petition for review on certiorari under Rule 45 Decision 11 dated April 26, 2007 dismissing the complaint filed by
of the Rules of Court seeking to annul and set aside the Court of Ilao, et al. The Ombudsman found that the act of destroying the
Appeals Decision 1 dated March 31, 2008 in CA-G.R. SP. No. basketball ring was only motivated by Cruz and
104474. The appellate court reversed and set aside the earlier Dela Cruz performing their sworn duty, as defined in the Local
decision of the Office of the Ombudsman dismissing the complaint Government Code.12 It found the act to be a mere response to the
filed against petitioners. clamor of constituents. 13 The office found that though the cutting
Below are the facts of the case. of the ring was "drastic," it was done by the barangay officials
Petitioner Natividad C. Cruz (Cruz) was Punong Barangay or within their lawful duties, as the act was only the result of the
Chairperson of Barangay 848, Zone 92, City of Manila. 2 On unauthorized removal of and failure to return the steel bar and
November 10, 2006, around five o'clock in the afternoon, and padlock that were earlier placed thereon. 14 Neither did the office
along Central Street, Pandacan, Manila, within the vicinity of her give credence to the allegation that Cruz uttered invectives
barangay, she allegedly confronted persons playing basketball against the complainants' witnesses, noting that the said
with the following statements: witnesses are tainted by their personal animosity against the
Bakit nakabukas ang (baskelball) court? Wala kayong karapatang barangay officials. 15
maglaro sa court na 'to, barangay namin ito! . . . Wala kayong After the Ombudsman's ruling dismissing the complaint filed
magagawa. Ako ang chairman dito. Mga walanghiya kayo, patay against Cruz and Dela Cruz, the complainants Ilao, et al. filed a
gutom! Hindi ako natatakot! Kaya kong panagutan lahat! 3 petition for review before the Court of Appeals praying for the latter
Then, she allegedly gave an order to the other court to nullify the Ombudsman's decision. 16 The petition's thesis
petitioner, Barangay Tanod Benjamin dela Cruz (Dela Cruz), to was that any actions in furtherance of the community's welfare
destroy the basketball ring by cutting it up with a hacksaw which must be approved by ordinance and that unless a thing is a
Dela Cruz promptly complied with, thus, rendering the said nuisance per se, such a thing may not be abated via an ordinance
basketball court unusable. 4 and extrajudicially. 17 CAIHTE
The acts of petitioners prompted the filing of a Complaint (for Commenting on the petition for review, the Office of the
Malicious Mischief, Grave Misconduct, Conduct Prejudicial to the Ombudsman, through the Office of the Solicitor General, averred
Best Interest of the Service and Abuse of Authority) 5 before the that Section 389 of the Local Government Code,which defines the
Prosecutor's Office and the Office of the Ombudsman by the group powers, duties and functions of the punong barangay, among
that claims to be the basketball court's owners, herein which are the power to enforce all laws and ordinances applicable
respondents Pandacan Hiker's Club, Inc. (PHC) and its president within the barangay and the power to maintain public order in the
Priscila Ilao (Ilao). In the complaint, they alleged that PHC, a non- barangay and, in pursuance thereof, to assist the city or municipal
stock, non-profit civic organization engaged in "health, mayor and the sanggunian members in the performance of their
infrastructure, sports and other so-called poverty alleviation duties and functions, does not require an ordinance for the said
activities" in the Pandacan area of Manila, is the group that had official to perform said functions. 18 The acts were also in
donated, administered and operated the subject basketball court pursuance of the promotion of the general welfare of the
for the Pandacan community until its alleged destruction by community, as mentioned in Section 16 of the Code. 19
petitioners. 6 In its assailed Decision dated March 31, 2008, the Court of
The complaint averred that the damage caused by petitioners was Appeals reversed and set aside the decision of the Office of the
in the amount of around P2,000.00. It was supported by the Ombudsman. The appellate court found petitioner Natividad
affidavits of ten (10) members of PHC who allegedly witnessed the C. Cruz liable for conduct prejudicial to the best interest of the
destruction. Meanwhile, respondent Ilao added that the acts of service and penalized her with a suspension of six (6) months and
petitioner Cruz, the Barangay Chairperson, of ordering the cutting one (1) day, while it reprimanded the other petitioner Benjamin
up of the basketball ring and uttering abusive language were dela Cruz, and also warned both officials that a future repetition of
"unwarranted and unbecoming of a public official." 7 the same or similar acts will be dealt with more severely.
In answer to the complaint, Cruz alleged that the basketball court The appellate court sustained the contentions of Ilao, et
affected the peace in the barangay and was the subject of many al. that Cruz and Dela Cruz performed an abatement of what they
complaints from residents asking for its closure. She alleged that thought was a public nuisance but did the same without following
the playing court blocked jeepneys from passing through and was the proper legal procedure, thus making them liable for said
the site of rampant bettings and fights involving persons from acts. 20 It held Cruz to be without the power to declare a thing a
within and outside the barangay. She claimed that innocent nuisance unless it is a nuisance per se. 21 It declared the subject
persons have been hurt and property had been damaged by such basketball ring as not such a nuisance and, thus, not subject to
armed confrontations, which often involved the throwing of rocks summary abatement. The court added that even if the same was
and improvised "molotov" bombs. She also averred that noise from to be considered a nuisance per accidens, the only way to
the games caused lack of sleep among some residents and that establish it as such is after a hearing conducted for that
the place's frequent visitors used the community's fences as purpose. 22
places to urinate. Cruz maintained that the court's users never
A motion for reconsideration, filed by Cruz and Dela Cruz was A nuisance is classified in two ways: (1) according to the object it
likewise denied by the appellate court. 23 Hence, they filed this affects; or (2) according to its susceptibility to summary
petition. abatement.
Petitioners maintain that they acted merely with the intention to As for a nuisance classified according to the object or objects that
regain free passage of people and vehicles over the street and it affects, a nuisance may either be: (a) a public nuisance, i.e., one
restore the peace, health and sanitation of those affected by the which "affects a community or neighborhood or any considerable
basketball court. Cruz, in particular, asserts that she merely number of persons, although the extent of the annoyance, danger
abated a public nuisance which she claimed was within her power or damage upon individuals may be unequal"; or (b) a private
as barangay chief executive to perform and was part of her duty to nuisance, or one "that is not included in the foregoing definition"
maintain peace and order. 24 which, in jurisprudence, is one which "violates only private rights
We deny the petition. and produces damages to but one or a few persons." 35
Under normal circumstances, this Court would not disturb the A nuisance may also be classified as to whether it is susceptible
findings of fact of the Office of the Ombudsman when they are to a legal summary abatement, in which case, it may either be: (a)
supported by substantial evidence. 25However, We make an a nuisance per se, when it affects the immediate safety of persons
exception of the case at bar because the findings of fact of the and property, which may be summarily abated under the
Ombudsman and the Court of Appeals widely differ. 26 undefined law of necessity; 36 or, (b) a nuisance per accidens,
It is held that the administrative offense of conduct prejudicial to which "depends upon certain conditions and circumstances, and
the interest of the service is committed when the questioned its existence being a question of fact, it cannot be abated without
conduct tarnished the image and integrity of the officer's public due hearing thereon in a tribunal authorized to decide whether
office; the conduct need not be related or connected to the public such a thing does in law constitute a nuisance;" 37 it may only be
officer's official functions for the said officer to be meted the so proven in a hearing conducted for that purpose and may not be
corresponding penalty. 27 The basis for such liability is Republic summarily abated without judicial intervention. 38
Act No. 6713, or the Code of Conduct and Ethical Standards for In the case at bar, none of the tribunals below made a factual
Public Officials and Employees, particularly Section 4 (c) thereof, finding that the basketball ring was a nuisance per se that is
which ordains that public officials and employees shall at all times susceptible to a summary abatement. And based on what appears
respect the rights of others, and shall refrain from doing acts in the records, it can be held, at most, as a mere nuisance per
contrary to public safety and public interest. 28 In one case, this accidens, for it does not pose an immediate effect upon the safety
Court also stated that the Machiavellian principle that "the end of persons and property, the definition of a nuisance per se.
justifies the means" has no place in government service, which Culling from examples cited in jurisprudence, it is unlike a mad dog
thrives on the rule of law, consistency and stability. 29 on the loose, which may be killed on sight because of the
For these reasons, in the case at bar, We agree with the appellate immediate danger it poses to the safety and lives of the people;
court that the petitioners' actions, though well-intentioned, were nor is it like pornographic materials, contaminated meat and
improper and done in excess of what was required by the situation narcotic drugs which are inherently pernicious and which may be
and fell short of the aforementioned standards of behavior for summarily destroyed; nor is it similar to a filthy restaurant which
public officials. may be summarily padlocked in the interest of the public
It is clear from the records that petitioners indeed cut or sawed in health. 39 A basketball ring, by itself, poses no immediate harm or
half the subject basketball ring, which resulted in the destruction danger to anyone but is merely an object of recreation. Neither is
of the said equipment and rendered it completely it, by its nature, injurious to rights of property, of health or of
unusable. 30 Petitioners also moved instantaneously and did not comfort of the community and, thus, it may not be abated as a
deliberate nor consult with the Sangguniang Barangay prior to nuisance without the benefit of a judicial hearing. 40
committing the subject acts; neither did they involve any police or But even if it is assumed, ex gratia argumenti, that the basketball
law enforcement agent in their actions. They acted while tempers ring was a nuisance per se, but without posing any immediate
were running high as petitioner Cruz, the Barangay Chairperson, harm or threat that required instantaneous action, the destruction
became incensed at the removal of the steel bar and padlock that or abatement performed by petitioners failed to observe the proper
was earlier used to close access to the ring and at the inability or procedure for such an action which puts the said act into legal
refusal of respondents' group to return the said steel bar and question.
padlock to her as she had ordered. Under Article 700 of the Civil Code,the abatement, including one
The destructive acts of petitioners, however, find no legal sanction. without judicial proceedings, of a public nuisance is the
This Court has ruled time and again that no public official is above responsibility of the district health of officer. Under Article 702 of
the law. 31 The Court of Appeals correctly ruled that although the Code, the district health officer is also the official who shall
petitioners claim to have merely performed an abatement of a determine whether or not abatement, without judicial proceedings,
public nuisance, the same was done summarily while failing to is the best remedy against a public nuisance. The two articles do
follow the proper procedure therefor and for which, petitioners not mention that the chief executive of the local government, like
must be held administratively liable. the Punong Barangay, is authorized as the official who can
Prevailing jurisprudence holds that unless a nuisance is a determine the propriety of a summary abatement.
nuisance per se, it may not be summarily abated. 32 Further, both petitioner Cruz, as Punong Barangay, and petitioner
There is a nuisance when there is "any act, omission, Dela Cruz, as Barangay Tanod, claim to have acted in their official
establishment, business, condition of property, or anything else capacities in the exercise of their powers under the general welfare
which: (1) injures or endangers the health or safety of others; or clause of the Local Government Code.However, petitioners could
(2) annoys or offends the senses; or (3) shocks, defies or cite no barangay nor city ordinance that would have justified their
disregards decency or morality; or (4) obstructs or interferes with summary abatement through the exercise of police powers found
the free passage of any public highway or street, or any body of in the said clause. No barangay nor city ordinance was violated;
water; or (5) hinders or impairs the use of property." 33 But other neither was there one which specifically declared the said
than the statutory definition, jurisprudence recognizes that the basketball ring as a nuisance per se that may be summarily
term "nuisance" is so comprehensive that it has been applied to abated. Though it has been held that a nuisance per se may be
almost all ways which have interfered with the rights of the citizens, abated via an ordinance, without judicial proceedings, 41 We add
either in person, property, the enjoyment of his property, or his that, in the case at bar, petitioners were required to justify their
comfort. 34 DETACa abatement via such an ordinance because the power they claim to
have exercised the police power under the general welfare
clause is a power exercised by the government mainly through (14) Promote the general welfare of the barangay;
its legislative, and not the executive, branch. The prevailing (15) Exercise such other powers and perform such other
jurisprudence is that local government units such as the provinces, duties and functions as may be prescribed by law or
cities, municipalities and barangays exercise police power through ordinance. 48
their respective legislative bodies. 42 Clearly, the complete destruction of the basketball ring by the
The general welfare clause provides for the exercise of police petitioners is justified neither by law or ordinance nor even by
power for the attainment or maintenance of the general welfare of equity or necessity, which makes the act illegal and petitioners
the community. The power, however, is exercised by the liable. And even as an action to maintain public order, it was done
government through its legislative branch by the enactment of laws excessively and was unjustified. Where a less damaging action,
regulating those and other constitutional and civil such as the mere padlocking, removal or confiscation of the ring
rights. 43 Jurisprudence defines police power as the plenary would have sufficed, petitioners resorted to the drastic measure of
power vested in the legislature to make statutes and ordinances completely destroying and rendering as unusable the said ring,
to promote the health, morals, peace, education, good order or which was a private property, without due process. Such an act
safety and general welfare of the people. 44 The Latin maxim went beyond what the law required and, in being so, it tarnished
is salus populi est suprema lex (the welfare of the people is the the image and integrity of the offices held by petitioners and
supreme law). 45 Police power is vested primarily with the national diminished the public's confidence in the legal system. Petitioners
legislature, which may delegate the same to local governments who were public officials should not have been too earnest at what
through the enactment of ordinances through their legislative they believed was an act of restoring peace and order in the
bodies (the sanggunians). 46 The so-called general welfare community if in the process they would end up disturbing it
clause, provided for in Section 16 of the Local Government Code, themselves. They cannot break the law that they were duty-bound
provides for such delegation of police power, to wit: to enforce. Although the Court bestows sympathy to the numerous
Section 16. General Welfare. Every local government unit shall constituents who allegedly complained against the basketball
exercise the powers expressly granted, those necessarily implied court to petitioners, it cannot legally agree with the methods
therefrom, as well as powers necessary, appropriate, or incidental employed by the said officials. Their good intentions do not justify
for its efficient and effective governance, and those which are the destruction of private property without a legal warrant, because
essential to the promotion of the general welfare. Within their the promotion of the general welfare is not antithetical to the
respective territorial jurisdictions, local government units shall preservation of the rule of law. 49 Unlike the examples cited earlier
ensure and support, among other things, the preservation and of a mad dog on the loose, pornography on display or a filthy
enrichment of culture, promote health and safety, enhance the restaurant, which all pose immediate danger to the public and,
right of the people to a balanced ecology, encourage and support therefore, could be addressed by anyone on sight, a basketball
the development of appropriate and self-reliant scientific and ring as a nuisance poses no such urgency that could have
technological capabilities, improve public morals, enhance prevented petitioners from exercising any form of deliberation or
economic prosperity and social justice, promote full employment circumspection before, acting on the same.
among their residents, maintain peace and order, and preserve Petitioners do not claim to have acted in their private capacities
the comfort and convenience of their inhabitants. but in their capacities as public officials, thus, they are held
Flowing from this delegated police power of local governments, a administratively liable for their acts. And even in their capacities as
local government unit like Barangay 848, Zone 92 in which private individuals who may have abated a public nuisance,
petitioners were public officials, exercises police power through its petitioners come up short of the legal requirements. They do not
legislative body, in this case, its Sangguniang claim to have complied with any of the requisites laid down in
Barangay. 47 Particularly, the ordinances passed by Article 704 of the Civil Code,to wit:
the sanggunian partly relate to the general welfare of the Art. 704. Any private person may abate a public nuisance which is
barangay, as also provided for by the Local Government Code as specially injurious to him by removing, or if necessary, by
follows: aDSIHc destroying the thing which constitutes the same, without
Section 391. Powers, Duties, and Functions. committing a breach of the peace, or doing unnecessary injury.
(a) The sangguniang barangay, as the legislative body of the But it is necessary:
barangay, shall: (1) That demand be first made upon the owner or possessor of the
(1) Enact ordinances as may be necessary to discharge the property to abate the nuisance;
responsibilities conferred upon it by law or ordinance and to (2) That such demand has been rejected;
promote the general welfare of the inhabitants therein; (3) That the abatement be approved by the district health officer
(emphasis supplied) and executed with the assistance of the local police; and
Even the powers granted to the punong barangay consist mainly (4) That the value of the destruction does not exceed three
of executing only those laws and ordinances already enacted by thousand pesos.
the legislative bodies, including the said official's WHEREFORE, premises considered, the petition is DENIED. The
own sangguniang barangay, to wit: Court of Appeals Decision dated March 31, 2008 in CA-G.R. SP.
Section 389. Chief Executive: Powers, Duties, and Functions. No. 104474 is AFFIRMED.
(a) The punong barangay, as the chief executive of the barangay SO ORDERED.
government, shall exercise such powers and perform such duties ||| (Cruz v. Pandacan Hiker's Club, Inc., G.R. No. 188213, [January
and functions, as provided by this Code and other laws. 11, 2016])
(b) For efficient, effective and economical governance,
the purpose of which is the general welfare of the barangay and PILAR DEVT CORP. v. DUMADAG
its inhabitants pursuant to Section 16 of this Code, the punong THIRD DIVISION
barangay shall: [G.R. No. 194336. March 11, 2013.]
(1) Enforce all laws and ordinances which are applicable within PILAR DEVELOPMENT CORPORATION, petitioner, vs.
the barangay; RAMON DUMADAG, EMMA BACABAC, RONALDO
xxx xxx xxx NAVARRO, JIMMY PAGDALIAN, PAY DELOS SANTOS,
(3) Maintain public order in the barangay and, in pursuance ARMANDO TRILLOS, FELICISIMO TRILLOS, ARCANGEL
thereof, assist the city or municipal mayor and the sanggunian FLORES, EDDIE MARTIN, PRESILLA LAYOG, CONRADO
members in the performance of their duties and functions; CAGUYONG, GINA GONZALES, ARLENE PEDROSA,
xxx xxx xxx JOCELYN ABELINO, ROQUE VILLARAZA, ROLANDO
VILLARAZA, CAMILO GENOVE, NILDA ROAYANA, SUSAN 101 11 of Commonwealth Act (C.A.) No. 141 (otherwise known
ROAYANA, JUANCHO PANGANIBAN, BONG DE GUZMAN, as The Public Land Act).
ARNOLD ENVERSO, DONNA DELA RAZA, EMELYN The motion for reconsideration filed by petitioner was denied by
HAGNAYA, FREDDIE DE LEON, RONILLO DE LEON, MARIO the CA per Resolution dated October 29, 2010, hence, this
MARTINEZ, and PRECY LOPEZ,respondents. petition.
DECISION Anchoring its pleadings on Article 630 12 of the Code, petitioner
PERALTA, J p: argues that although the portion of the subject property occupied
Challenged in this petition for review on certiorari under Rule 45 of by respondents is within the 3-meter strip reserved for public
the Rules of Civil Procedure are the March 5, 2010 Decision 1 and easement, it still retains ownership thereof since the strip does not
October 29, 2010 Resolution 2 of the Court of Appeals (CA) in CA- form part of the public dominion. As the owner of the subject parcel
G.R. CV No. 90254, which affirmed the May 30, 2007 of land, it is entitled to its lawful possession, hence, the proper
Decision 3 of the Las Pias Regional Trial Court, Branch 197 (trial party to file an action for recovery of possession against
court) dismissing the complaint filed by petitioner. respondents conformably with Articles 428 13 and 539 14 of the
On July 1, 2002, petitioner filed a Complaint 4 for accion Code. cAaETS
publiciana with damages against respondents for allegedly We deny.
building their shanties, without its knowledge and consent, in its An easement or servitude is a real right on another's property,
5,613-square-meter property located at Daisy Road, corporeal and immovable, whereby the owner of the latter must
Phase V, Pilar Village Subdivision, Almanza, Las Pias City. It refrain from doing or allowing somebody else to do or something
claims that said parcel of land, which is duly registered in its name to be done on his or her property, for the benefit of another person
under Transfer Certificate of Title No. 481436 of the Register of or tenement; it is jus in re aliena, inseparable from the estate to
Deeds for the Province of Rizal, was designated as an open space which it actively or passively belongs, indivisible, perpetual, and a
of Pilar Village Subdivision intended for village recreational continuing property right, unless extinguished by causes provided
facilities and amenities for subdivision residents. 5 In their Answer by law. 15 The Code defines easement as an encumbrance
with Counterclaim, 6 respondents denied the material allegations imposed upon an immovable for the benefit of another immovable
of the Complaint and briefly asserted that it is the local belonging to a different owner or for the benefit of a community, or
government, not petitioner, which has jurisdiction and authority of one or more persons to whom the encumbered estate does not
over them. belong. 16 There are two kinds of easement according to source:
Trial ensued. Both parties presented their respective witnesses by law or by will of the owners the former are called legal and
and the trial court additionally conducted an ocular inspection of the latter voluntary easement. 17 A legal easement or compulsory
the subject property. easement, or an easement by necessity constituted by law has for
On May 30, 2007, the trial court dismissed petitioner's complaint, its object either public use or the interest of private persons. 18
finding that the land being occupied by respondents are situated While Article 630 of the Code provides for the general rule that
on the sloping area going down and leading towards the "[t]he owner of the servient estate retains the ownership of the
Mahabang Ilog Creek, and within the three-meter legal easement; portion on which the easement is established, and may use the
thus, considered as public property and part of public dominion same in such a manner as not to affect the exercise of the
under Article 502 7 of the New Civil Code (Code), which could not easement," Article 635 thereof is specific in saying that "[a]ll
be owned by petitioner. The court held: DacASC matters concerning easements established for public or
. . . The land title of [petitioner] only proves that it is the owner in communal use shall be governed by the special laws and
fee simple of the respective real properties described therein, free regulations relating thereto, and, in the absence thereof, by the
from all liens and encumbrances, except such as may be provisions of this Title [Title VII on Easements or Servitudes]."
expressly noted thereon or otherwise reserved by law . . . . And in In the case at bar, the applicability of DENR A.O. No. 99-21 dated
the present case, what is expressly reserved is what is written in June 11, 1999, which superseded DENR A.O. No. 97-05 19 dated
TCT No. T-481436, to wit "that the 3.00 meter strip of the lot March 6, 1997 and prescribed the revised guidelines in the
described herein along the Mahabang Ilog Creek is reserved for implementation of the pertinent provisions of Republic Act (R.A.)
public easement purposes. (From OCT 1873/A-50) and to the No. 1273 and Presidential Decree (P.D.) Nos. 705 and 1067,
limitations imposed by Republic Act No. 440. . . ." 8 cannot be doubted. Inter alia, it was issued to further the
The trial court opined that respondents have a better right to government's program of biodiversity preservation. Aside from
possess the occupied lot, since they are in an area reserved for Section 2.1 above-quoted, Section 2.3 of which further mandates:
public easement purposes and that only the local government of 2.3 Survey of Titled Lands:
Las Pias City could institute an action for recovery of possession 2.3.1 Administratively Titled Lands:
or ownership. The provisions of item 2.1.a and 2.1.b shall be observed as the
Petitioner filed a motion for reconsideration, but the same was above. However, when these lands are to be subdivided,
denied by the trial court in its Order dated August 21, consolidated or consolidated-subdivided, the strip of three (3)
2007. 9 Consequently, petitioner elevated the matter to the Court meters which falls within urban areas shall be demarcated and
of Appeals which, on March 5, 2010, sustained the dismissal of marked on the plan for easement and bank protection. TEDHaA
the case. The purpose of these strips of land shall be noted in the technical
Referring to Section 2 10 of Administrative Order (A.O.) No. 99-21 description and annotated in the title.
of the Department of Environment and Natural Resources xxx xxx xxx
(DENR), the appellate court ruled that the 3-meter area being 2.3.3 Complex Subdivision or Consolidation Subdivision Surveys
disputed is located along the creek which, in turn, is a form of a for Housing/Residential, Commercial or Industrial Purposes:
stream; therefore, belonging to the public dominion. It said that When titled lands are subdivided or consolidated-subdivided into
petitioner could not close its eyes or ignore the fact, which is lots for residential, commercial or industrial purposes the
glaring in its own title, that the 3-meter strip was indeed reserved segregation of the three (3) meter wide strip along the banks of
for public easement. By relying on the TCT, it is then estopped rivers or streams shall be observed and be made part of the open
from claiming ownership and enforcing its supposed right. Unlike space requirement pursuant to P.D. 1216.
the trial court, however, the CA noted that the proper party entitled The strip shall be preserved and shall not be subject to subsequent
to seek recovery of possession of the contested portion is not the subdivision. (Underscoring supplied)
City of Las Pias, but the Republic of the Philippines, through the Certainly, in the case of residential subdivisions, the allocation of
Office of the Solicitor General (OSG), pursuant to Section the 3-meter strip along the banks of a stream, like the Mahabang
Ilog Creek in this case, is required and shall be considered as The head of any local government unit concerned who allows,
forming part of the open space requirement pursuant to P.D. 1216 abets or otherwise tolerates the construction of any structure in
dated October 14, 1977. 20 Said law is explicit: open spaces are violation of this section shall be liable to administrative sanctions
"for public use and are, therefore, beyond the commerce of men" under existing laws and to penal sanctions provided for in this
and that "[the] areas reserved for parks, playgrounds and Act. SIcCTD
recreational use shall be non-alienable public lands, and non- Yet all is not lost for petitioner. It may properly file an action
buildable." for mandamus to compel the local government of Las Pias City
Running in same vein is P.D. 1067 or The Water Code of the to enforce with reasonable dispatch the eviction, demolition, and
Philippines 21 which provides: relocation of respondents and any other persons similarly situated
Art. 51. The banks of rivers and streams and the shores of the in order to give flesh to one of the avowed policies of R.A. 7279,
seas and lakes throughout their entire length and within a zone of which is to reduce urban dysfunctions, particularly those that
three (3) meters in urban areas, twenty (20) meters in agricultural adversely affect public health, safety, and ecology. 28 Indeed, as
areas and forty (40) meters in forest areas, along their one of the basic human needs, housing is a matter of state concern
margins, are subject to the easement of public use in the interest as it directly and significantly affects the general welfare. 29
of recreation, navigation, floatage, fishing and salvage. No person WHEREFORE, the petition is DENIED. The March 5, 2010
shall be allowed to stay in this zone longer than what is necessary Decision and October 29, 2010 Resolution of the Court of Appeals
for recreation, navigation, floatage, fishing or salvage or to build in CA-G.R. CV No. 90254, which affirmed the May 30, 2007
structures of any kind. (Underscoring supplied) ISDHEa Decision of the Las Pias RTC, Branch 197, dismissing petitioner's
Thus, the above proves that petitioner's right of ownership and complaint, is hereby AFFIRMED.
possession has been limited by law with respect to the 3-meter SO ORDERED.
strip/zone along the banks of Mahabang Ilog Creek. Despite this, ||| (Pilar Development Corp. v. Dumadag, G.R. No. 194336,
the Court cannot agree with the trial court's opinion, as to which [March 11, 2013], 706 PHIL 93-105)
the CA did not pass upon, that respondents have a better right to
possess the subject portion of the land because they are CALIMOSO v. ROULLO
occupying an area reserved for public easement purposes. Similar SECOND DIVISION
to petitioner, respondents have no right or title over it precisely [G.R. No. 198594. January 25, 2016.]
because it is public land. Likewise, we repeatedly held that HELEN CALIMOSO, MARILYN P. CALIMOSO and LIBY
squatters have no possessory rights over the land intruded P. CALIMOSO, petitioners, vs. AXEL D. ROULLO, respondent.
upon. 22 The length of time that they may have physically DECISION
occupied the land is immaterial; they are deemed to have entered BRION, J p:
the same in bad faith, such that the nature of their possession is Before us is a petition for review on certiorari 1 assailing the
presumed to have retained the same character throughout their December 15, 2010 decision 2 and the August 23, 2011
occupancy. 23 resolution 3 of the Court of Appeals (CA), Cebu City, in CA-G.R.
As to the issue of who is the proper party entitled to institute a case CEB CV No. 00834. The CA affirmed the decision of the Regional
with respect to the 3-meter strip/zone, We find and so hold that Trial Court (RTC), Branch 29, Iloilo City, in Civil Case No. CEB-
both the Republic of the Philippines, through the OSG and the 23858 that ordered the establishment of an "easement of right of
local government of Las Pias City, may file an action depending way" in favor of respondent Axel D. Roullo.
on the purpose sought to be achieved. The former shall be Facts of the Case
responsible in case of action for reversion under C.A. 141, while In his Complaint 4 for Easement of Right of Way, the respondent
the latter may also bring an action to enforce the relevant mainly alleged: that he is the owner of Lot 1462-C-1 5 situated in
provisions of Republic Act No. 7279 (otherwise known as Brgy. Sambag, Jaro, Iloilo City; that his lot is isolated by several
the Urban Development and Housing Act of 1992). 24 Under R.A. surrounding estates, including Lot 1454-B-25 6 owned by
7279, which was enacted to uplift the living conditions in the poorer petitioners Helen, Marilyn, and Liby, all surnamed Calimoso; that
sections of the communities in urban areas and was envisioned to he needs a right-of-way in order to have access to a public road;
be the antidote to the pernicious problem of squatting in the and that the shortest and most convenient access to the nearest
metropolis, 25 all local government units (LGUs) are mandated to public road, i.e., Fajardo Subdivision Road, passes through the
evict and demolish persons or entities occupying danger areas petitioners' lot.
such as esteros, railroad tracks, garbage dumps, riverbanks, The petitioners objected to the establishment of the easement
shorelines, waterways, and other public places such as sidewalks, because it would cause substantial damage to the two (2) houses
roads, parks, and playgrounds. 26 Moreover, under pain of already standing on their property. They alleged that the
administrative and criminal liability in case of non-compliance, 27 it respondent has other right-of-way alternatives, such as the
obliges LGUs to strictly observe the following: existing wooden bridge over Sipac Creek bounding the
Section 29. Resettlement. Within two (2) years from the respondent's lot on the northeast; that the bridge, if made
effectivity of this Act, the local government units, in coordination concrete, could provide ingress or egress to the Fajardo
with the National Housing Authority, shall implement the relocation Subdivision Road. AaCTcI
and resettlement of persons living in danger areas such as Due to the respondent's allegedly malicious and groundless suit,
esteros, railroad tracks, garbage dumps, riverbanks, shorelines, the petitioners claimed entitlement to the following awards:
waterways, and in other public places such as sidewalks, roads, P100,000.00 as moral damages, P30,000.00 as exemplary
parks and playgrounds. The local government unit, in coordination damages, P50,000.00 as attorney's fees, P1,000.00 as
with the National Housing Authority, shall provide relocation or appearance fee, and P15,000.00 as litigation expenses.
resettlement sites with basic services and facilities and access to In a decision dated September 29, 2003, the RTC granted the
employment and livelihood opportunities sufficient to meet the respondent's complaint and ordered the petitioners to provide the
basic needs of the affected families. respondent an easement of right-of-way "measuring 14 meters in
Section 30. Prohibition Against New Illegal Structures. It shall length and 3 meters in width (42 square meters, more or less) over
be unlawful for any person to construct any structure in areas Lot 1454-B-25, specifically at the portion adjoining the bank of
mentioned in the preceding section. Sipac Creek." Accordingly, the RTC ordered the respondent to pay
After the effectivity of this Act, the barangay, municipal or city the petitioners proper indemnity in the amount of "Php1,500.00 per
government units shall prevent the construction of any kind or square meter of the portion of the lot subject of the easement." The
illegal dwelling units or structures within their respective localities. petitioners appealed the RTC's decision to the CA.
The CA, in its assailed December 15, 2010 decision, affirmed in of a certain Mr. Basa in order to reach the Fajardo Subdivision
toto the RTC's decision and held that all the requisites for the Road.
establishment of a legal or compulsory easement of right-of-way Among the right-of-way alternatives, the CA adopted the first
were present in the respondent's case: first, that the subject lot is option, i.e., passing through the petitioner's lot, because it offered
indeed surrounded by estates owned by different individuals and the shortest distance (from the respondent's lot) to the Fajardo
the respondent has no access to any existing public road; second, Subdivision Road and the right-of-way would only affect the
that the respondent has offered to compensate the petitioners for "nipa hut" standing on the petitioners' property. The CA held that
the establishment of the right-of-way through the latter's the establishment of the easement through the petitioners' lot was
property; third, that the isolation of the subject lot was not caused more practical, economical, and less burdensome to the parties.
by the respondent as he purchased the lot without any adequate Article 650 of the Civil Code provides that the easement of right-
ingress or egress to a public highway; and, fourth and last, given of-way shall be established at the point least prejudicial to the
the available options for the right-of-way, the route that passes servient estate, and, insofar as consistent with this rule, where the
through the petitioners' lot requires the shortest distance to distance from the dominant estate to a public highway may be
a public road and can be established at a point least the shortest. Under this guideline, whenever there are several
prejudicial to the petitioners' property. tenements surrounding the dominant estate, the right-of-way must
The petitioners moved to reconsider the CA's decision arguing be established on the tenement where the distance to the public
that, while the establishment of the easement through their lot road or highway is shortest and where the least damage would be
provided for the shortest route, the adjudged right-of-way would caused. If these two criteria (shortest distance and least damage)
cause severe damage not only to the nipa hut situated at the do not concur in a single tenement, we have held in the past that
corner of the petitioners' lot, but also to the bedroom portion of the the least prejudice criterion must prevail over the shortest
other concrete house that stood on the property. The CA, however, distance criterion. 9
did not consider the petitioners' arguments on the ground that the In this case, the establishment of a right-of-way through the
matters alleged were not raised or proven before the trial court, petitioners' lot would cause the destruction of the wire fence and a
thus, it denied the petitioners' motion for reconsideration. house on the petitioners' property. 10Although this right-of-way
The petitioners filed the present petition for review has the shortest distance to a public road, it is not the least
on certiorari raising the issues of: (a) whether the respondent has prejudicial considering the destruction pointed out, and that an
met all the requisites for the establishment of a legal easement of option to traverse two vacant lots without causing any damage,
right-of-way on Lot 1454-B-25 owned by the petitioners, (b) albeit longer, is available. HSAcaE
whether the establishment of the right-of-way on the petitioners' lot We have held that "mere convenience for the dominant estate is
is at the point least prejudicial to the servient estate, and (c) not what is required by law as the basis of setting up a compulsory
whether a right-of-way can be established through other lots easement;" 11 that "a longer way may be adopted to avoid injury
surrounding the respondent's property other than through the to the servient estate, such as when there are constructions or
petitioners' property. walls which can be avoided by a round-about way." 12
OUR RULING WHEREFORE, we hereby GRANT the present petition for review
We disagree with the CA finding that all the requisites for the on certiorari and REVERSE and SET ASIDE the decision dated
valid establishment of an easement of right-of-way are December 15, 2010, and resolution dated August 23, 2011, of the
present in this case. Court of Appeals in CA-G.R. CEB CV No. 00834. The complaint
To be entitled to an easement of right-of-way, the following for the easement of right-of-way is DISMISSED without prejudice
requisites should be met: to another complaint that the respondent may file against the
"1. The dominant estate is surrounded by other immovables and proper party or parties based on the terms of this Decision.
has no adequate outlet to a public highway; Costs against respondent Axel D. Roullo.
2. There is payment of proper indemnity; SO ORDERED.
3. The isolation is not due to the acts of the proprietor of the ||| (Calimoso v. Roullo, G.R. No. 198594, [January 25, 2016])
dominant estate; and EcTCAD
4. The right-of-way claimed is at the point least prejudicial to the LIWAG v. GLEN LOOP HOMEOWNERS ASSOC
servient estate; and insofar as consistent with this rule, where the SECOND DIVISION
distance from the dominant estate to a public highway may be the [G.R. No. 189755. July 4, 2012.]
shortest." 7 EMETERIA LIWAG, petitioner, vs. HAPPY GLEN LOOP HOME
The immovable in whose favor the easement is established is OWNERS ASSOCIATION, INC., respondent.
called the dominant estate, and the property subject to the DECISION
easement is called the servient estate. 8 Here, the respondent's SERENO, J p:
lot is the dominant estate and the petitioners' lot is the servient This Rule 45 Petition assails the Decision 1 and Resolution 2 of
estate. the Court of Appeals (CA) in CA-G.R. SP No. 100454. The CA
That the respondent's lot is surrounded by several estates and has affirmed with modification the Decision 3 and Order 4 of the Office
no access to a public road are undisputed. The only question of the President (O.P.) in OP Case No. 05-G-224, which had set
before this Court is whether the right-of-way passing through the aside the Decision 5 of the Board of Commissioners of the
petitioners' lot satisfies the fourth requirement of Housing and Land Use Regulatory Board (HLURB) in HLURB
being established at the point least prejudicial to the servient Case No. REM-A-041210-0261 and affirmed the Decision 6 of the
estate. Housing and Land Use Arbiter in HLURB Case No. REM-030904-
Three options were then available to the respondent for the 12609.
demanded right-of-way: the first option is to traverse directly The controversy stems from a water facility
through the petitioners' property, which route has an approximate in Happy Glen Loop Subdivision (the Subdivision), which is
distance of fourteen (14) meters from the respondent's lot to the situated in Deparo, Caloocan City.
Fajardo Subdivision Road; the second option is to pass through Sometime in 1978, F.G.R. Sales, the original developer
two vacant lots (Lots 1461-B-1 and 1461-B-2) located on the of Happy Glen Loop, obtained a loan from Ernesto Marcelo
southwest of the respondent's lot, which route has an approximate (Marcelo), the owner of T.P. Marcelo Realty Corporation. To settle
distance of forty-three (43) meters to another public highway, the its debt after failing to pay its obligation, F.G.R. Sales assigned to
Diversion Road; and the third option is to construct a concrete Marcelo all its rights over several parcels of land in the Subdivision,
bridge over Sipac Creek and ask for a right-of-way on the property as well as receivables from the lots already sold. 7
As the successor-in-interest of the original developer, Marcelo space required under P.D. 957 excluded road lots; and, thus, the
represented to subdivision lot buyers, the National Housing Subdivision's open space was still short of that required by law.
Authority (NHA) and the Human Settlement Regulatory Finally, it ruled that petitioner Liwag was aware of the
Commission (HSRC) that a water facility was available in the representations made by Marcelo and his predecessors-in-
Subdivision. 8 interest, because he had acknowledged the existence of a water
For almost 30 years, the residents of the Subdivision relied on this installation system as per his Affidavit of 10 August 1982. 15
facility as their only source of water. 9 This fact was acknowledged Petitioner Liwag unsuccessfully moved for
by Marcelo and Hermogenes Liwag(Hermogenes), petitioner's reconsideration, 16 then filed a Rule 43 Petition for Review before
late husband who was then the president of the CA. 17
respondent Happy Glen Loop Homeowners Association The CA affirmed that the HLURB possessed jurisdiction to
(Association). 10 TIaCAc invalidate the sale of the subject parcel of land to Hermogenes and
Sometime in September 1995, Marcelo sold Lot 11, Block No. 5 to to invalidate the issuance of TCT No. C-350099 pursuant
Hermogenes. As a result, Transfer Certificate of Title (TCT) No. C- thereto. 18 The appellate court agreed with the OP that an
350099 was issued to him. When Hermogenes died in 2003, easement for water facility existed on the subject parcel of land
petitioner Emeteria P. Liwag subsequently wrote a letter to and formed part of the open space required to be reserved by the
respondent Association, demanding the removal of the overhead subdivision developer under P.D. 957. 19 However, it ruled that
water tank from the subject parcel of land. 11 Arbiter Melchor should not have recommended the filing of a
Refusing to comply with petitioner's demand, respondent criminal action against petitioner, as she was not involved in the
Association filed before the HLURB an action for specific development of the Subdivision or the sale of its lots to
performance; confirmation, maintenance and donation of water buyers. 20 The CA likewise deleted the award of attorney's fees
facilities; annulment of sale; and cancellation of TCT No. 350099 and damages in favor of respondent. 21
against T.P. Marcelo Realty Corporation (the owner and developer Aggrieved, petitioner filed the instant Petition before this Court.
of the Subdivision), petitioner Emeteria, and the other surviving The Court's Ruling
heirs of Hermogenes. We affirm the ruling of the appellate court.
After the parties submitted their respective position papers, I
Housing and Land Use Arbiter Joselito Melchor (Arbiter Melchor) The HLURB has exclusive jurisdiction
ruled in favor of the Association. He invalidated the transfer of the over the case at bar
parcel of land in favor of Hermogenes in a Decision dated 5 The jurisdiction of the HLURB is outlined in P.D. 1344,
October 2004, the dispositive portion of which reads: 12 "Empowering the National Housing Authority to Issue Writ of
WHEREFORE, premises considered, judgment is hereby Execution in the Enforcement of its Decision under Presidential
rendered as follows: Decree No. 957," viz.:
1. Confirming the existence of an easement for water Sec. 1. In the exercise of its functions to regulate real estate trade
system/facility or open space on Lot 11, Block 5 of TCT No. C- and business and in addition to its powers provided for
350099 wherein the deep well and overhead tank are situated, in Presidential Decree No. 957, the National Housing Authority
2. Making the Temporary Restraining Order dated 01 April 2004 shall have the exclusive jurisdiction to hear and decide cases of
permanent so as to allow the continuous use and maintenance of the following nature.
the said water facility, i.e., deep well and over head water tank, on A. Unsound real estate business practices;
the subject lot, by the complainant's members and residents of the B. Claims involving refund and any other claims filed by
subject project, and restraining all the respondents from subdivision lot or condominium unit buyer against the project
committing the acts complained of and as described in the owner, developer, dealer, broker or salesman; and
complaint, C. Cases involving specific performance of contractual and
3. Declaring as void ab initio the deed of sale dated 26 February statutory obligations filed by buyers of subdivision lots or
2001, involving Lot 11, Block 5 in favor of spouses Liwag, and TCT condominium units against the owner, developer, broker or
No. C-350099 in the name of same respondents without prejudice salesman.
to complainant's right to institute a criminal action in coordination When respondent Association filed its Complaint before the
with the prosecuting arms of the government against respondents HLURB, it alleged that Marcelo's sale of Lot 11, Block 5 to
Marcelo and Liwag, and furthermore, with recourse Hermogenes was done in violation of P.D. 957 in the following
by Liwag against T.P. and/or Marcelo to ask for replacement for manner:
controverted lot with a new one within the subject project; and 12. Through fraudulent acts and connivance of [T.P. and Ernesto
4. Ordering respondents, jointly and severally, to pay complainant Marcelo] and the late Liwag and without the knowledge and
the amount of P10,000.00 as attorney's fees and the amount of consent of the complainants all in violation of P.D. 957 and its
P20,000.00 as damages in favor of the complainant's members. implementing regulations, respondents T.P. and Ernesto
SO ORDERED. Marcelo transferred the same lot where the deep well is located
On appeal before the HLURB Board of Commissioners, the Board which is covered by TCT No. C-41785 in favor of
found that Lot 11, Block 5 was not an open space. Moreover, it spouses Hermogenes Liwag and Emeteria Liwag to the great
ruled that Marcelo had complied with the requirements damage and prejudice of complainants . . . . 22 (Emphasis in
of Presidential Decree No. (P.D.) 1216 with the donation of 9,047 the original) SaCIAE
square meters of open space and road lots. It further stated that We find that this statement sufficiently alleges that the subdivision
there was no proof that Marcelo or the original subdivision owner owner and developer fraudulently sold to Hermogenes the lot
or developer had at any time represented that Lot 11, Block 5 was where the water facility was located. Subdivisions are mandated
an open space. It therefore concluded that the use of the lot as site to maintain and provide adequate water facilities for their
of the water tank was merely tolerated. 13 SCEHaD communities. 23 Without a provision for an alternative water
Respondent Association interposed an appeal to the OP, which source, the subdivision developer's alleged sale of the lot where
set aside the Decision of the HLURB Board of Commissioners and the community's sole water source was located constituted a
affirmed that of the Housing and Land Use Arbiter. 14 violation of this obligation. Thus, this allegation makes out a case
The OP ruled that Lot 11, Block 5 was an open space, because it for an unsound real estate business practice of the subdivision
was the site of the water installation of the Subdivision, per owner and developer. Clearly, the case at bar falls within the
Marcelo's official representation on file with the HLURB National exclusive jurisdiction of the HLURB.
Capital Region Field Office. The OP further ruled that the open
It is worthy to note that the HLURB has exclusive jurisdiction over determine whether these areas fall under "other similar facilities
complaints arising from contracts between the subdivision and amenities."
developer and the lot buyer, or those aimed at compelling the The basic statutory construction principle of ejusdem
subdivision developer to comply with its contractual and statutory generis states that where a general word or phrase follows an
obligations to make the Subdivision a better place to live enumeration of particular and specific words of the same class,
in. 24 This interpretation is in line with one of P.D. 957's "Whereas the general word or phrase is to be construed to include or to
clauses," which provides: be restricted to things akin to or resembling, or of the same kind
WHEREAS, numerous reports reveal that many real estate or class as, those specifically mentioned. 34
subdivision owners, developers, operators, and/or sellers have Applying this principle to the afore-quoted Section 1 of P.D. 1216,
reneged on their representations and obligations to provide and we find that the enumeration refers to areas reserved for the
maintain properly subdivision roads, drainage, sewerage, water common welfare of the community. Thus, the phrase "other similar
systems, lighting systems, and other similar basic requirements, facilities and amenities" should be interpreted in like manner.
thus endangering the health and safety of home and lot buyers. . . Here, the water facility was undoubtedly established for the benefit
.. of the community. Water is a basic need in human
P.D. 957 was promulgated to closely regulate real estate settlements, 35 without which the community would not survive.
subdivision and condominium businesses. 25 Its provisions were We therefore rule that, based on the principle of ejusdem
intended to encompass all questions regarding subdivisions and generis and taking into consideration the intention of the law to
condominiums. 26 The decree aimed to provide for an appropriate create and maintain a healthy environment in human
government agency, the HLURB, to which aggrieved parties in settlements, 36 the location of the water facility in the Subdivision
transactions involving subdivisions and condominiums may take must form part of the area reserved for open space.
recourse. 27 IV
II The subject parcel of land is beyond the commerce of man
An easement for water facility exists on Lot 11, Block 5 and its sale is prohibited under the law
of Happy Glen Loop Subdivision The law expressly provides that open spaces in subdivisions are
Easements or servitudes are encumbrances imposed upon an reserved for public use and are beyond the commerce of
immovable for the benefit of another immovable belonging to a man. 37 As such, these open spaces are not susceptible of private
different owner, 28 for the benefit of a community, 29or for the ownership and appropriation. We therefore rule that the sale of the
benefit of one or more persons to whom the encumbered estate subject parcel of land by the subdivision owner or developer to
does not belong. 30 petitioner's late husband was contrary to law. Hence, we find no
The law provides that easements may be continuous or reversible error in the appellate court's Decision upholding the
discontinuous and apparent or non-apparent. The pertinent HLURB Arbiter's annulment of the Deed of Sale.
provisions of the Civil Code are quoted below: IHCacT Petitioner attempts to argue in favor of the validity of the sale of
Art. 615. Easements may be continuous or discontinuous, the subject parcel of land by invoking the principle of indefeasibility
apparent or non-apparent. of title and by arguing that this action constitutes a collateral attack
Continuous easements are those the use of which is or may be against her title, an act proscribed by the Property Registration
incessant, without the intervention of any act of man. Decree.
Discontinuous easements are those which are used at intervals Petitioner is mistaken on both counts.
and depend upon the acts of man. First, the rule that a collateral attack against a Torrens title is
Apparent easements are those which are made known and are prohibited by law 38 finds no application to this case.
continually kept in view by external signs that reveal the use and There is an attack on the title when the object of an action is to
enjoyment of the same. nullify a Torrens title, thus challenging the judgment or proceeding
Non-apparent easements are those which show no external pursuant to which the title was decreed. 39 In the present case,
indication of their existence. this action is not an attack against the validity of the Torrens title,
In this case, the water facility is an encumbrance on Lot 11, Block because it does not question the judgment or proceeding that led
5 of the Subdivision for the benefit of the community. It is to the issuance of the title. Rather, this action questions the validity
continuous and apparent, because it is used incessantly without of the transfer of land from Marcelo to petitioner's husband. As
human intervention, and because it is continually kept in view by there is no attack direct or collateral against the title,
the overhead water tank, which reveals its use to the public. petitioner's argument holds no water.
Contrary to petitioner's contention that the existence of the water Second, the principle of indefeasibility of title is not absolute, and
tank on Lot 11, Block 5 is merely tolerated, we find that the there are well-defined exceptions to this rule. 40 In Aqualab
easement of water facility has been voluntarily established either Philippines, Inc. v. Heirs of Pagobo, 41 we ruled that this defense
by Marcelo, the Subdivision owner and developer; or by F.G.R. does not extend to a transferee who takes the title with knowledge
Sales, his predecessor-in-interest and the original developer of the of a defect in that of the transferee's predecessor-in-interest.
Subdivision. For more than 30 years, the facility was continuously In this case, Spouses Liwag were aware of the existence of the
used as the residents' sole source of water. 31 The Civil easement of water facility when Marcelo sold Lot 11, Block 5 to
Code provides that continuous and apparent easements are them. Hermogenes even executed an Affidavit dated 10 August
acquired either by virtue of a title or by prescription of 10 1982 attesting to the sufficiency of the water supply coming from
years. 32 It is therefore clear that an easement of water facility has an electrically operated water pump in the Subdivision. 42 It is
already been acquired through prescription. CcTHaD undisputed that the water facility in question was their only water
III source during that time. As residents of the Subdivision, they had
Lot 11, Block 5 of Happy Glen Loop Subdivision forms part even benefited for almost 30 years from its existence. Therefore,
of its open space petitioner cannot be shielded by the principle of indefeasibility and
The term "open space" is defined in P.D. 1216 as "an area conclusiveness of title, as she was not an innocent purchaser in
reserved exclusively for parks, playgrounds, recreational uses, good faith and for value.
schools, roads, places of worship, hospitals, health From the discussion above, we therefore conclude that the
centers, barangay centers and other similar facilities and appellate court committed no reversible error in the assailed
amenities. 33 Decision and accordingly affirm it in toto.
The decree makes no specific mention of areas reserved for water WHEREFORE, premises considered, the instant Petition for
facilities. Therefore, we resort to statutory construction to Review is DENIED, and the assailed Decision and Resolution of
the Court of Appeals in CA-G.R. SP No. 100454 are during their parents' lifetime, the couple distributed their real and
hereby AFFIRMED. cASTED personal properties in favor of their ten (10) children. Upon
SO ORDERED. distribution, petitioners alleged that they received the subject
||| (Liwag v. Happy Glen Loop Homeowners Association, Inc., G.R. property and the house constructed thereon as their share. They
No. 189755, [July 4, 2012], 690 PHIL 321-335) likewise averred that they have been in adverse, open, continuous,
and uninterrupted possession of the property for over four (4)
QUINTOS v. NICOLAS decades and are, thus, entitled to equitable title thereto. They also
THIRD DIVISION deny any participation in the execution of the aforementioned
[G.R. No. 210252. June 16, 2014.] Deed of Adjudication dated September 21, 2004 and the
VILMA QUINTOS, represented by her Attorney-in-Fact FIDEL Agreement of Subdivision.
I. QUINTOS, JR.; FLORENCIA I. DANCEL, represented by her Respondents countered that petitioners' cause of action was
Attorney-in-Fact FLOVY I. DANCEL; and CATALINO L. already barred by estoppel when sometime in 2006, one of
IBARRA, petitioners, vs. PELAGIA I. NICOLAS, NOLI L. petitioners offered to buy the 7/10 undivided share of the
IBARRA, SANTIAGO L. IBARRA, PEDRO L. IBARRA, DAVID L. respondent siblings. They point out that this is an admission on the
IBARRA, GILBERTO L. IBARRA, HEIRS OF AUGUSTO L. part of petitioners that the property is not entirely theirs. In addition,
IBARRA, namely CONCHITA R. IBARRA, APOLONIO IBARRA, they claimed that Bienvenido and Escolastica Ibarra mortgaged
and NARCISO IBARRA, and the spouses RECTO the property but because of financial constraints, respondent
CANDELARIO and ROSEMARIE CANDELARIO, respondents. spouses Candelario had to redeem the property in their behalf. Not
DECISION having been repaid by Bienvenido and Escolastica, the
VELASCO, JR., J p: Candelarios accepted from their co-respondents their share in the
The Case subject property as payment. Lastly, respondents sought, by way
Before the Court is a Petition for Review on Certiorari filed under of counterclaim, the partition of the property.
Rule 45 challenging the Decision 1 and Resolution 2 of the Court Docketed as Civil Case No. 09-15 of the RTC of Camiling, Tarlac,
of Appeals (CA) in CA-G.R. CV No. 98919 dated July 8, 2013 and the quieting of title case was eventually raffled to Branch 68 of the
November 22, 2013, respectively. The challenged rulings affirmed court, the same trial court that dismissed Civil Case No. 02-52.
the May 7, 2012 Decision 3 of the Regional Trial Court (RTC), During pre-trial, respondents, or defendants a quo, admitted
Branch 68 in Camiling, Tarlac that petitioners and respondents are having filed an action for partition, that petitioners did not
co-owners of the subject property, which should be partitioned as participate in the Deed of Adjudication that served as the basis for
per the subdivision plan submitted by respondent spouses Recto the issuance of TCT No. 390484, and that the Agreement of
and Rosemarie Candelario. Subdivision that led to the issuance of TCT No. 434304 in favor of
The Facts respondent spouses Candelario was falsified. 9
As culled from the records, the facts of the case are as follows: Despite the admissions of respondents, however, the RTC,
Petitioners Vilma Quintos, Florencia Dancel, and Catalino Ibarra, through its May 27, 2012 Decision, dismissed petitioners'
and respondents Pelagia Nicolas, Noli Ibarra, Santiago Ibarra, complaint. The court did not find merit in petitioners' asseverations
Pedro Ibarra, David Ibarra, Gilberto Ibarra, and the late Augusto that they have acquired title over the property through acquisitive
Ibarra are siblings. Their parents, Bienvenido and Escolastica prescription and noted that there was no document evidencing that
Ibarra, were the owners of the subject property, a 281 sq.m. parcel their parents bequeathed to them the subject property. Finding that
of land situated along Quezon Ave., Poblacion C, Camiling, Tarlac, respondent siblings were entitled to their respective shares in the
covered by Transfer Certificate Title (TCT) No. 318717. property as descendants of Bienvenido and Escolastica Ibarra and
By 1999, both Bienvenido and Escolastica had already passed as co-heirs of petitioners, the subsequent transfer of their interest
away, leaving to their ten (10) children ownership over the subject in favor of respondent spouses Candelario was then upheld by the
property. Subsequently, sometime in 2002, respondent siblings trial court. The dispositive portion of the Decision reads:
brought an action for partition against petitioners. The case was WHEREFORE, premises considered, the above-entitled case is
docketed as Civil Case No. 02-52 and was raffled to the RTC, hereby Dismissed.
Branch 68, Camiling, Tarlac. However, in an Order 4 dated March Also, defendants-spouses Rosemarie Candelario and Recto
22, 2004, the trial court dismissed the case disposing as follows: Candelario are hereby declared as the absolute owners of the 7/10
For failure of the parties, as well as their counsels, to appear portion of the subject lot.
despite due notice, this case is hereby DISMISSED. Likewise, the court hereby orders the partition of the subject lots
SO ORDERED. between the herein plaintiffs and the defendants-spouses
As neither set of parties appealed, the ruling of the trial court Candelarios.
became final, as evidenced by a Certificate of Finality 5 it SO ORDERED. THaCAI
eventually issued on August 22, 2008. Aggrieved, petitioners appealed the trial court's Decision to the
Having failed to secure a favorable decision for partition, CA, pleading the same allegations they averred in their underlying
respondent siblings instead resorted to executing a Deed of complaint for quieting of title. However, they added that the
Adjudication 6 on September 21, 2004 to transfer the property in partition should no longer be allowed since it is already barred
favor of the ten (10) siblings. As a result, TCT No. 318717 was by res judicata, respondent siblings having already filed a case for
canceled and in lieu thereof, TCT No. 390484 was issued in its partition that was dismissed with finality, as admitted by
place by the Registry of Deeds of Tarlac in the names of the ten respondents themselves during pre-trial.
(10) heirs of the Ibarra spouses. ScCDET On July 8, 2013, the CA issued the assailed Decision denying the
Subsequently, respondent siblings sold their 7/10 undivided share appeal. The fallo reads:
over the property in favor of their co-respondents, the spouses WHEREFORE, premises considered, the Decision dated May 7,
Recto and Rosemarie Candelario. By virtue of a Deed of Absolute 2012 of the Regional Trial Court of Camiling, Tarlac, Branch 68, in
Sale 7 dated April 17, 2007 executed in favor of the spouses Civil Case No. 09-15, is hereby AFFIRMED.
Candelario and an Agreement of Subdivision 8 purportedly SO ORDERED.
executed by them and petitioners, TCT No. 390484 was partially Similar to the trial court, the court a quo found no evidence on
canceled and TCT No. 434304 was issued in the name of the record to support petitioners' claim that the subject property was
Candelarios, covering the 7/10 portion. specifically bequeathed by Bienvenido and Escolastica Ibarra in
On June 1, 2009, petitioners filed a complaint for Quieting of Title their favor as their share in their parents' estate. It also did not
and Damages against respondents wherein they alleged that consider petitioners' possession of the property as one that is in
the concept of an owner. Ultimately, the appellate court upheld the facts and does not normally undertake the re-examination of the
finding that petitioners and respondent spouses Candelario co- evidence presented by the contending parties during the
own the property, 30-70 in favor of the respondent spouses. trial. 14 Although there are exceptions 15 to this general rule as
As regards the issue of partition, the CA added: eloquently enunciated in jurisprudence, none of the circumstances
. . . Since it was conceded that the subject lot is now co-owned by calling for their application obtains in the case at bar. Thus, We are
the plaintiffs-appellants, (with 3/10 undivided interest) and constrained to respect and uphold the findings of fact arrived at by
defendants-appellees Spouses Candelarios (with 7/10 undivided both the RTC and the CA.
interest) and considering that plaintiffs-appellants had already In any event, a perusal of the records would readily show that
constructed a 3-storey building at the back portion of the property, petitioners, as aptly observed by the courts below, indeed, failed
then partition, in accordance with the subdivision plan (records, p. to substantiate their claim. Their alleged open, continuous,
378) undertaken by defendants-appellants [sic] spouses, is in exclusive, and uninterrupted possession of the subject property is
order. 10 belied by the fact that respondent siblings, in 2005, entered into a
On November 22, 2013, petitioners' Motion for Reconsideration Contract of Lease with the Avico Lending Investor Co. over the
was denied. Hence, the instant petition. subject lot without any objection from the
Issues petitioners. 16 Petitioners' inability to offer evidence tending to
In the present petition, the following errors were raised: prove that Bienvenido and Escolastica Ibarra transferred the
I. THE COURT OF APPEALS MANIFESTLY OVERLOOKED ownership over the property in favor of petitioners is likewise fatal
RELEVANT AND UNDISPUTED FACTS WHICH, IF PROPERLY to the latter's claim. On the contrary, on May 28, 1998, Escolastica
CONSIDERED, WOULD JUSTIFY PETITIONERS' CLAIM OF Ibarra executed a Deed of Sale covering half of the subject
EQUITABLE TITLE. property in favor of all her 10 children, not in favor of petitioners
II. THE COURT OF APPEALS ERRED WHEN IT AFFIRMED THE alone. 17
ORDER OF PARTITION DESPITE THE FACT THAT THE The cardinal rule is that bare allegation of title does not suffice.
COUNTERCLAIM FOR PARTITION, BASED ON THE DEED OF The burden of proof is on the plaintiff to establish his or her case
ABSOLUTE SALE EXECUTED IN 2007, IS BARRED BY by preponderance of evidence. 18 Regrettably, petitioners, as
LACHES. such plaintiff, in this case failed to discharge the said burden
III. THE COURT OF APPEALS RENDERED A SUBSTANTIALLY imposed upon them in proving legal or equitable title over the
FLAWED JUDGMENT WHEN IT NEGLECTED TO RULE ON parcel of land in issue. As such, there is no reason to disturb the
PETITIONERS' CONTENTION THAT THE COUNTERCLAIM finding of the RTC that all 10 siblings inherited the subject property
FOR PARTITION IS ALSO BARRED BY PRIOR JUDGMENT, from Bienvenido and Escolastica Ibarra, and after the respondent
DESPITE ITS HAVING BEEN SPECIFICALLY ASSIGNED AS siblings sold their aliquot share to the spouses Candelario,
ERROR AND PROPERLY ARGUED IN THEIR BRIEF, AND petitioners and respondent spouses became co-owners of the
WHICH, IF PROPERLY CONSIDERED, WOULD JUSTIFY THE same.
DISMISSAL OF THE COUNTERCLAIM. The counterclaim for partition is not barred by prior judgment
IV. THE COURT OF APPEALS ERRED WHEN IT ORDERED This brings us to the issue of partition as raised by respondents in
PARTITION IN ACCORDANCE WITH THE SUBDIVISION PLAN their counterclaim. In their answer to the counterclaim, petitioners
MENTIONED IN ITS DECISION, IN CONTRAVENTION OF THE countered that the action for partition has already been barred
PROCEDURE ESTABLISHED IN RULE 69 OF THE RULES OF by res judicata.
CIVIL PROCEDURE. 11 The doctrine of res judicata provides that the judgment in a first
To simplify, the pertinent issues in this case are as case is final as to the claim or demand in controversy, between the
follows: ISCTcH parties and those privy with them, not only as to every matter which
1. Whether or not the petitioners were able to prove ownership was offered and received to sustain or defeat the claim or demand,
over the property; but as to any other admissible matter which must have been
2. Whether or not the respondents' counterclaim for partition is offered for that purpose and all matters that could have been
already barred by laches or res judicata; and adjudged in that case. 19 It precludes parties from relitigating
3. Whether or not the CA was correct in approving the subdivision issues actually litigated and determined by a prior and final
agreement as basis for the partition of the property. judgment. 20 As held in Yusingco v. Ong Hing Lian: 21
The Court's Ruling It is a rule pervading every well-regulated system of jurisprudence,
The petition is meritorious in part. and is put upon two grounds embodied in various maxims of the
Petitioners were not able to prove equitable common law; the one, public policy and necessity, which makes it
title or ownership over the property to the interest of the state that there should be an end to litigation
Quieting of title is a common law remedy for the removal of any republicae ut sit, finis litium; the other, the hardship on the
cloud, doubt, or uncertainty affecting title to real property. 12 For individual that he should be vexed twice for the same cause
an action to quiet title to prosper, two indispensable requisites nemo debet bis vexari et eadem causa. A contrary doctrine
must concur, namely: (1) the plaintiff or complainant has a legal or would subject the public peace and quiet to the will and neglect of
equitable title to or interest in the real property subject of the action; individuals and prefer the gratitude identification of a litigious
and (2) the deed, claim, encumbrance, or proceeding claimed to disposition on the part of suitors to the preservation of the public
be casting cloud on the title must be shown to be in fact invalid or tranquility and happiness. 22 AICDSa
inoperative despite its prima facie appearance of validity or The rationale for this principle is that a party should not be vexed
efficacy. 13 In the case at bar, the CA correctly observed that twice concerning the same cause. Indeed, res judicata is a
petitioners' cause of action must necessarily fail mainly in view of fundamental concept in the organization of every jural society, for
the absence of the first requisite. not only does it ward off endless litigation, it ensures the stability
At the outset, it must be emphasized that the determination of of judgment and guards against inconsistent decisions on the
whether or not petitioners sufficiently proved their claim of same set of facts. 23
ownership or equitable title is substantially a factual issue that is There is res judicata when the following requisites are present: (1)
generally improper for Us to delve into. Section 1, Rule 45 of the the formal judgment or order must be final; (2) it must be a
Rules of Court explicitly states that the petition for review judgment or order on the merits, that is, it was rendered after a
on certiorari "shall raise only questions of law, which must be consideration of the evidence or stipulations submitted by the
distinctly set forth." In appeals by certiorari, therefore, only parties at the trial of the case; (3) it must have been rendered by a
questions of law may be raised, because this Court is not a trier of court having jurisdiction over the subject matter and the parties;
and (4) there must be, between the first and second actions, No prescription shall run in favor of a co-owner or co-heir against
identity of parties, of subject matter and of cause of action. 24 his co-owners or co-heirs so long as he expressly or impliedly
In the case at bar, respondent siblings admit that they filed an recognizes the co-ownership. (emphasis supplied)
action for partition docketed as Civil Case No. 02-52, which the From the above-quoted provision, it can be gleaned that the law
RTC dismissed through an Order dated March 22, 2004 for the generally does not favor the retention of co-ownership as a
failure of the parties to attend the scheduled hearings. property relation, and is interested instead in ascertaining the co-
Respondents likewise admitted that since they no longer appealed owners' specific shares so as to prevent the allocation of portions
the dismissal, the ruling attained finality. Moreover, it cannot be to remain perpetually in limbo. Thus, the law provides that each
disputed that the subject property in Civil Case No. 02-52 and in co-owner may demand at any time the partition of the thing
the present controversy are one and the same, and that in both owned in common.
cases, respondents raise the same action for partition. And lastly, Between dismissal with prejudice under Rule 17, Sec. 3 and the
although respondent spouses Candelario were not party-litigants right granted to co-owners under Art. 494 of the Civil Code,the
in the earlier case for partition, there is identity of parties not only latter must prevail. To construe otherwise would diminish the
when the parties in the case are the same, but also between those substantive right of a co-owner through the promulgation of
in privity with them, such as between their successors-in- procedural rules. Such a construction is not sanctioned by the
interest. 25 principle, which is too well settled to require citation, that a
With all the other elements present, what is left to be determined substantive law cannot be amended by a procedural rule. 28 This
now is whether or not the dismissal of Civil case No. 02-52 further finds support in Art. 496 of the New Civil Code, viz.:
operated as a dismissal on the merits that would complete the Article 496. Partition may be made by agreement between the
requirements of res judicata. parties or by judicial proceedings. Partition shall be governed by
In advancing their claim, petitioners cite Rule 17, Sec. 3 of the Rules of Court insofar as they are consistent with this
the Rules of Court,to wit: Code.
Section 3. Dismissal due to fault of plaintiff. If, for no justifiable Thus, for the Rules to be consistent with statutory provisions, We
cause, the plaintiff fails to appear on the date of the presentation hold that Art. 494, as cited, is an exception to Rule 17, Sec. 3 of
of his evidence in chief on the complaint, or to prosecute his action the Rules of Court to the effect that even if the order of dismissal
for an unreasonable length of time, or to comply with these Rules for failure to prosecute is silent on whether or not it is with
or any order of the court, the complaint may be dismissed upon prejudice, it shall be deemed to be without prejudice.
motion of the defendant or upon the court's own motion, without This is not to say, however, that the action for partition will never
prejudice to the right of the defendant to prosecute his be barred by res judicata. There can still be res judicata in partition
counterclaim in the same or in a separate action. This dismissal cases concerning the same parties and the same subject matter
shall have the effect of an adjudication upon the merits, once the respective shares of the co-owners have been
unless otherwise declared by the court. determined with finality by a competent court with jurisdiction or if
The afore-quoted provision enumerates the instances when a the court determines that partition is improper for co-ownership
complaint may be dismissed due to the plaintiff's fault: (1) if he fails does not or no longer exists.
to appear on the date for the presentation of his evidence in chief So it was that in Rizal v. Naredo, 29 We ruled in the following wise:
on the complaint; (2) if he fails to prosecute his action for an Article 484 of the New Civil Code provides that there is co-
unreasonable length of time; or (3) if he fails to comply with the ownership whenever the ownership of an undivided thing or right
Rules or any order of the court. The dismissal of a case for failure belongs to different persons. Thus, on the one hand, a co-owner
to prosecute has the effect of adjudication on the merits, and is of an undivided parcel of land is an owner of the whole, and over
necessarily understood to be with prejudice to the filing of another the whole he exercises the right of dominion, but he is at the same
action, unless otherwise provided in the order of dismissal. Stated time the owner of a portion which is truly abstract. On the other
differently, the general rule is that dismissal of a case for failure to hand, there is no co-ownership when the different portions
prosecute is to be regarded as an adjudication on the merits and owned by different people are already concretely determined
with prejudice to the filing of another action, and the only exception and separately identifiable, even if not yet technically
is when the order of dismissal expressly contains a qualification described.
that the dismissal is without prejudice. 26 In the case at bar, Pursuant to Article 494 of the Civil Code,no co-owner is obliged to
petitioners claim that the Order does not in any language say that remain in the co-ownership, and his proper remedy is an action for
the dismissal is without prejudice and, thus, the requirement that partition under Rule 69 of the Rules of Court,which he may bring
the dismissal be on the merits is present. at anytime in so far as his share is concerned. Article 1079 of
Truly, We have had the occasion to rule that dismissal with the Civil Code defines partition as the separation, division and
prejudice under the above-cited rule amply satisfies one of the assignment of a thing held in common among those to whom it
elements of res judicata. 27 It is, thus, understandable why may belong. It has been held that the fact that the agreement of
petitioners would allege res judicata to bolster their claim. partition lacks the technical description of the parties' respective
However, dismissal with prejudice under Rule 17, Sec. 3 of portions or that the subject property was then still embraced by the
the Rules of Court cannot defeat the right of a co-owner to ask for same certificate of title could not legally prevent a partition, where
partition at any time, provided that there is no actual adjudication the different portions allotted to each were determined and
of ownership of shares yet. became separately identifiable.
Pertinent hereto is Article 494 of the Civil Code,which reads: The partition of Lot No. 252 was the result of the approved
Article 494. No co-owner shall be obliged to remain in the co- Compromise Agreement in Civil Case No. 36-C, which was
ownership. Each co-owner may demand at any time the immediately final and executory. Absent any showing that said
partition of the thing owned in common, insofar as his share Compromise Agreement was vitiated by fraud, mistake or duress,
is concerned. the court cannot set aside a judgment based on compromise. It is
Nevertheless, an agreement to keep the thing undivided for a axiomatic that a compromise agreement once approved by the
certain period of time, not exceeding ten years, shall be valid. This court settles the rights of the parties and has the force of res
term may be extended by a new agreement. EaICAD judicata. It cannot be disturbed except on the ground of vice of
A donor or testator may prohibit partition for a period which shall consent or forgery.
not exceed twenty years. Of equal significance is the fact that the compromise judgment in
Neither shall there be any partition when it is prohibited by law. Civil Case No. 36-C settled as well the question of which specific
portions of Lot No. 252 accrued to the parties separately as their
proportionate shares therein. Through their subdivision survey be tantamount to allowing respondent spouses to divide
plan, marked as Annex "A" of the Compromise Agreement and unilaterally the property among the co-owners based on their own
made an integral part thereof, the parties segregated and whims and caprices. Such a result could not be countenanced.
separately assigned to themselves distinct portions of Lot No. 252. To rectify this with dispatch, the case must be remanded to the
The partition was immediately executory, having been court of origin, which shall proceed to partition the property in
accomplished and completed on December 1, 1971 when accordance with the procedure outlined in Rule 69 of the Rules of
judgment was rendered approving the same. The CA was correct Court.
when it stated that no co-ownership exist when the different WHEREFORE, premises considered, the petition is
portions owned by different people are already concretely hereby PARTLY GRANTED. The assailed Decision and
determined and separately identifiable, even if not yet Resolution of the Court of Appeals in CA-G.R. CV No. 98919 dated
technically described. (emphasis supplied) July 8, 2013 and November 22, 2013, respectively, are
In the quoted case, We have held that res judicata applied hereby AFFIRMED with MODIFICATION. The case is
because after the parties executed a compromise agreement that hereby REMANDED to the RTC, Branch 68 in Camiling, Tarlac for
was duly approved by the court, the different portions of the purposes of partitioning the subject property in accordance with
owners have already been ascertained. Thus, there was no longer Rule 69 of the Rules of Court.
a co-ownership and there was nothing left to partition. This is in SO ORDERED.
contrast with the case at bar wherein the co-ownership, as ||| (Quintos v. Nicolas, G.R. No. 210252, [June 16, 2014], 736
determined by the trial court, is still subsisting 30-70 in favor of PHIL 438-460)
respondent spouses Candelario. Consequently, there is no legal
bar preventing herein respondents from praying for the partition of VDA DE FIGURACION v. FIGURACION-GERILLA
the property through counterclaim. DSAEIT FIRST DIVISION
The counterclaim for partition is not barred by laches [G.R. No. 151334. February 13, 2013.]
We now proceed to petitioners' second line of attack. According to CAROLINA (CARLINA) VDA. DE FIGURACION, HEIRS OF
petitioners, the claim for partition is already barred by laches since ELENA FIGURACION-ANCHETA, namely: LEONCIO
by 1999, both Bienvenido and Escolastica Ibarra had already died ANCHETA, JR., and ROMULO ANCHETA, HEIRS OF HILARIA
and yet the respondent siblings only belatedly filed the action for A. FIGURACION, namely: FELIPA FIGURACION-MANUEL,
partition, Civil Case No. 02-52, in 2002. And since laches has MARY FIGURACION-GINEZ, and EMILIA FIGURACION-
allegedly already set in against respondent siblings, so too should GERILLA, AND HEIRS OF QUINTIN FIGURACION, namely:
respondent spouses Candelario be barred from claiming the same LINDA M. FIGURACION, LEANDRO M. FIGURACION, II, and
for they could not have acquired a better right than their ALLAN M. FIGURACION, petitioners, vs.
predecessors-in-interest. EMILIA FIGURACION-GERILLA,respondent.
The argument fails to persuade. DECISION
Laches is the failure or neglect, for an unreasonable and REYES, J p:
unexplained length of time, to do that which by the exercise of At bar is a Petition for Review on Certiorari 1 under Rule 45 of the
due diligence could or should have been done earlier. It is the Rules of Court, assailing the Decision 2 dated December 11, 2001
negligence or omission to assert a right within a reasonable period, of the Court of Appeals (CA) in CA-G.R. CV No. 58290, which
warranting the presumption that the party entitled to assert it has reversed and set aside the Decision 3 dated June 26, 1997 of the
either abandoned or declined to assert it. 30 The principle is a Regional Trial Court (RTC) of Urdaneta, Pangasinan, Branch 49.
creation of equity which, as such, is applied not really to penalize The RTC decision (1) dismissed respondent Emilia Figuracion-
neglect or sleeping upon one's right, but rather to avoid Gerilla's (Emilia) complaint for partition, annulment of documents,
recognizing a right when to do so would result in a clearly reconveyance, quieting of title and damages, and (2) annulled
inequitable situation. As an equitable defense, laches does not the Affidavit of Self-Adjudication executed by petitioner Carolina
concern itself with the character of the petitioners' title, but only (Carlina) Vda. De Figuracion (Carolina).
with whether or not by reason of the respondents' long inaction or The Facts
inexcusable neglect, they should be barred from asserting this The parties are the heirs of Leandro Figuracion (Leandro) who
claim at all, because to allow them to do so would be inequitable died intestate in May 1958. Petitioner Carolina is the surviving
and unjust to petitioners. 31 spouse. The other petitioners Elena Figuracion-Ancheta,
As correctly appreciated by the lower courts, respondents cannot Hilaria A. Figuracion (Hilaria), Felipa Figuracion-Manuel (Felipa),
be said to have neglected to assert their right over the subject Quintin Figuracion, and Mary Figuracion-Ginez and respondent
property. They cannot be considered to have abandoned their right Emilia were Carolina and Leandro's children. 4
given that they filed an action for partition sometime in 2002, even Subject of the dispute are two parcels of land both situated in
though it was later dismissed. Furthermore, the fact that Urdaneta, Pangasinan, which were acquired by Leandro during his
respondent siblings entered into a Contract of Lease with Avico lifetime. These properties were: (1) Lot No. 2299 with a land area
Lending Investor Co. over the subject property is evidence that of 7,547 square meters originally covered by Transfer Certificate
they are exercising rights of ownership over the same. of Title (TCT) No. 4221-P; 5 and (2) Lot No. 705 measuring 2,900
The CA erred in approving the Agreement for Subdivision square meters and covered by TCT No. 4220-P. Both lands were
There is merit, however, in petitioners' contention that the CA erred registered in the name of "Leandro Figuracion married to Carolina
in approving the proposal for partition submitted by respondent Adviento". Leandro executed a Deed of Quitclaim over the above
spouses. Art. 496, as earlier cited, provides that partition shall real properties in favor of his six (6) children on August 23, 1955.
either be by agreement of the parties or in accordance with Their shares, however, were not delineated with particularity
the Rules of Court. In this case, the Agreement of Subdivision because spouses Leandro and Carolina reserved the lots and its
allegedly executed by respondent spouses Candelario and fruits for their expenses. ISTECA
petitioners cannot serve as basis for partition, for, as stated in the Also involved in the controversy is Lot No. 707 of the Cadastral
pre-trial order, herein respondents admitted that the agreement Survey of Urdaneta, Pangasinan, with an area of 3,164 square
was a falsity and that petitioners never took part in preparing the meters originally owned by Eulalio Adviento (Eulalio), covered by
same. The "agreement" was crafted without any consultation Original Certificate of Title (OCT) No. 15867 issued in his name on
whatsoever or any attempt to arrive at mutually acceptable terms August 21, 1917. Eulalio begot Agripina Adviento (Agripina) with
with petitioners. It, therefore, lacked the essential requisite of his first wife Marcela Estioko (Marcela), whom Eulalio survived.
consent. Thus, to approve the agreement in spite of this fact would When he remarried, Eulalio had another daughter, herein
petitioner Carolina, with his second wife, Faustina Escabesa belonging to her co-owner, Agripina. The proper action in such
(Faustina). 6 case is not the nullification of the sale, or for the recovery of
On November 28, 1961, Agripina 7 executed a Deed of possession of the property owned in common from the third
Quitclaim 8 over the eastern half of Lot No. 707 in favor of her person, but for a division or partition of the entire lot. Such partition
niece, herein respondent Emilia. should result in segregating the portion belonging to the seller and
Soon thereafter or on December 11, 1962, petitioner Carolina its delivery to the buyer.
executed an Affidavit of Self-Adjudication 9 adjudicating unto The CA, however, agreed with the RTC that a partition of Lot Nos.
herself the entire Lot No. 707 as the sole and exclusive heir of her 2299 and 705 is indeed premature considering that there is a
deceased parents, Eulalio and Faustina. 10 On the same date, pending legal controversy with respect to Lot No. 705 and the
Carolina also executed a Deed of Absolute Sale 11 over Lot No. accounting of the income from Lot No. 2299 and of the expenses
707 in favor of petitioners Hilaria and Felipa, who in turn for the last illness and burial of Leandro and Carolina, for which
immediately caused the cancellation of OCT No. 15867 and the the lots appear to have been intended.
issuance of TCT No. 42244 in their names. 12 Accordingly, the decretal portion of the CA decision
In 1971, Emilia and her family went to the United States and reads: STcHDC
returned to the Philippines only in 1981. Upon her return and WHEREFORE, premises considered, the present appeal is hereby
relying on the Deed of Quitclaim, she built a house on the eastern GRANTED and the decision appealed from in Civil Case No. U-
half of Lot No. 707. 13 5826 is hereby VACATED and SET ASIDE. A new judgment is
The legal debacle of the Figuracions started in 1994 when Hilaria hereby rendered declaring Lot No. 707 covered by TCT No. 42244
and her agents threatened to demolish the house of Emilia who, to be owned by appellant Emilia Figuracion-Gerilla [herein
in retaliation, was prompted to seek the partition of Lot No. 707 as respondent], 1/2 pro indiviso share, appellee
well as Lot Nos. 2299 and 705. The matter was initially brought Felipa Figuracion [herein petitioner], 1/4 pro indiviso share, and
before the Katarungang Pambarangay, but no amicable appellee Hilaria Figuracion [herein petitioner], 1/4 pro
settlement was reached by the parties. 14On May 23, 1994, indiviso share, who are hereby directed to partition the same and
respondent Emilia instituted the herein Complaint 15 for the if they could not agree on a partition, they may petition the trial
partition of Lot Nos. 2299, 705 and 707, annulment of the Affidavit court for the appointment of a commissioner to prepare a project
of Self-Adjudication, Deed of Absolute Sale and TCT No. 42244, of partition, in accordance with the procedure as provided in Rule
reconveyance of eastern half portion of Lot No. 707, quieting of 69 of the 1997 Rules of Civil Procedure, as amended.
title and damages. No pronouncement as to costs.
In opposition, the petitioners averred the following special and SO ORDERED. 20
affirmative defenses: (1) the respondent's cause of action had long Respondent Emilia appealed the CA's decision to the Court,
prescribed and that she is guilty of laches hence, now estopped docketed as G.R. No. 154322. In a Decision promulgated on
from bringing the suit; (2) TCT No. 42244 in the name of Felipa August 22, 2006, the Court denied the appeal, concurring with the
and Hilaria have already attained indefeasibility and CA's ruling that a partition of Lot Nos. 2299 and 705 would be
conclusiveness as to the true owners of Lot No. 707; and (3) an inappropriate considering that: (1) the ownership of Lot No. 705 is
action for partition is no longer tenable because Felipa and Hilaria still in dispute; and (2) there are still unresolved issues as to the
have already acquired rights adverse to that claimed by expenses chargeable to the estate of Leandro.
respondent Emilia and the same amount to a repudiation of the The present petition involves the appeal of the petitioners who
alleged co-ownership. 16 STcaDI attribute this sole error committed by the CA:
During pre-trial conference, the issues were simplified into: (1) THE DECISION RENDERED BY THE HONORABLE COURT OF
whether or not Lot Nos. 2299 and 705 are the exclusive properties APPEALS IS CONTRARY TO LAW AND EXISTING
of Leandro; and (2) whether or not respondent Emilia is the owner JURISPRUDENTIAL DICTA LAID DOWN BY THE HONORABLE
of the eastern half of Lot No. 707. 17 SUPREME COURT. 21
On the basis of the evidence adduced by the parties, the RTC In view of the Court's ruling in G.R. No. 154322, the ensuing
rendered its Decision dated June 26, 1997 disposing as follows: discussion shall concern only Lot No. 707.
WHEREFORE, premises considered, the complaint for partition, The Arguments of the Parties
reconveyance, quieting of title and damages is hereby ordered The petitioners argue that respondent Emilia has no valid basis for
dismissed whereas the affidavit of self-adjudication[,] deed of sale her claim of ownership because the Deed of Quitclaim executed in
and the transfer certificate of title involving Lot 707 are hereby her favor by Agripina was in fact a deed of donation that contained
declared null and void. no acceptance and thus, void. The petitioners attached a copy of
No costs. the Deed of Quitclaim and stressed on the following
SO ORDERED. 18 portions, viz.: ACETIa
The RTC ruled that a partition of Lot Nos. 2299 and 705 will be I, AGRIPINA ESTIOKO ADVIENTO, of le[ga]l age, Filipino citizen,
premature since their ownership is yet to be transmitted from single and a resident [of] San Vicenter (sic), Urdaneta City,
Leandro to his heirs whose respective shares thereto must still be Pangasinan, for and in consideration of the sum of ONE PESO
determined in estate settlement proceedings. Anent Lot No. 707, ([P]1.00), Philippine Currency and the services rendered by my
the RTC held that petitioner Carolina transferred only her one-half niece EMILIA FIGURACION, 20 years old, single, Filipino citizen
(1/2) share to Felipa and Hilaria and any conveyance of the other and a resident of San Vicente, Urdaneta City, Pangasinan, do
half pertaining to Agripina was void. While the RTC nullified hereby by these presentsw (sic) RENOUNCE, RELEASE and
the Affidavit of Self-Adjudication, Deed of Absolute Sale and TCT forever QUITCLAIM in favor of EMILIA FIGURACION, her heirs,
No. 42244, it refused to adjudicate the ownership of the lot's and assigns the ONE[-]HALF (1/2) eastern portion of the following
eastern half portion in favor of respondent Emilia since a parcel of land more particularly described and bounded as follows
settlement of the estate of Eulalio is yet to be undertaken. 19 to wit[.]22
Respondent Emilia appealed to the CA, which, in its Decision They further aver that the Deed of Quitclaim is riddled with defects
dated December 11, 2001, ruled that the RTC erred in refusing to that evoke questions of law, because: (a) it has not been
partition Lot No. 707. The CA explained that there is no necessity registered with the Register of Deeds, albeit, allegedly executed
for placing Lot No. 707 under judicial administration since Carolina as early as 1961; (b) a certification dated June 3, 2003 issued by
had long sold her 1/2 pro indiviso share to Felipa and Hilaria. the Office of the Clerk of Court (OCC) of the RTC of Urdaneta,
Thus, when Carolina sold the entire Lot No. 707 on December 11, Pangasinan, shows that it does not have a copy of the Deed of
1962 as her own, the sale affected only her share and not that Quitclaim; (c) the Office of the National Archives which is the
depository of old and new notarized documents has no record of during trial, the petitioners are now barred by estoppel 34 from
the Deed of Quitclaim as evidenced by a certification dated May imploring an examination of the same.
19, 2003; 23 and (d) Atty. Felipe V. Abenojar, who supposedly The respondent can compel the
notarized the Deed of Quitclaim was not commissioned to notarize partition of Lot No. 707
in 1961 per the certification dated June 9, 2003 from the OCC of The first stage in an action for partition is the settlement of the
the RTC of Urdaneta, Pangasinan. 24 issue of ownership. Such an action will not lie if the claimant has
Respondent Emilia, on the other hand, contends that the Deed of no rightful interest in the subject property. In fact, the parties filing
Quitclaim should be considered an onerous donation that requires the action are required by the Rules of Court to set forth in their
no acceptance as it is governed by the rules on contracts and not complaint the nature and the extent of their title to the property. It
by the formalities for a simple donation. 25 would be premature to effect a partition until and unless the
The Court's Ruling question of ownership is first definitely resolved. 35 IAEcCT
Issues not raised before the courts a Here, the respondent traces her ownership over the eastern half
quo cannot be raised for the first of Lot No. 707 from the Deed of Quitclaim executed by Agripina,
time in a petition filed under Rule who in turn, was the co-owner thereof being one of the legitimate
45 heirs of Eulalio. It is well to recall that the petitioners failed to
Records show that there is a palpable shift in the defense raised categorically dispute the existence of the Deed of Quitclaim.
by the petitioners before the RTC and the CA. Instead, they averred that it has been rendered ineffective by TCT
In the Pre-Trial Order 26 of the RTC dated April 4, 1995, the No. 42244 in the name of Felipa and Hilaria this contention is,
parties agreed to limit the issue with regard to Lot No. 707 as of course, flawed.
follows: whether or not respondent Emilia is the owner of the Mere issuance of a certificate of title in the name of any person
eastern half portion of Lot No. 707. The petitioners' supporting does not foreclose the possibility that the real property may be
theory for this issue was that "the Deed of Quitclaim dated under co-ownership with persons not named in the certificate, or
November 28, 1961 was rendered ineffective by the issuance of that the registrant may only be a trustee, or that other parties may
[TCT No. 42244] in the name of Felipa and Hilaria." 27 On appeal have acquired interest over the property subsequent to the
to the CA, however, the petitioners raised a new theory by issuance of the certificate of title. 36Stated differently, placing a
questioning the execution and enforceability of the Deed parcel of land under the mantle of the Torrens system does not
of Quitclaim. They claimed that it is actually a donation that was mean that ownership thereof can no longer be disputed. The
not accepted in the manner required by law. 28 certificate cannot always be considered as conclusive evidence of
The inconsistent postures taken by the petitioners breach the ownership. 37 In this case, co-ownership of Lot No. 707 was
basic procedural tenet that a party cannot change his theory on precisely what respondent Emilia was able to successfully
appeal as expressly adopted in Rule 44, Section 15 of the Rules establish, as correctly found by the RTC and affirmed by the
of Court,which reads: AISHcD CA.
Sec. 15. Questions that may be raised on appeal. Whether or The status of Agripina and Carolina as the legitimate heirs of
not the appellant has filed a motion for new trial in the court below, Eulalio is an undisputed fact. As such heirs, they became co-
he may include in his assignment of errors any question of law or owners of Lot No. 707 upon the death of Eulalio on July 20, 1930.
fact that has been raised in the court below and which is within the Since Faustina was predeceased by Eulalio, she likewise became
issues framed by the parties. a co-owner of the lot upon Eulalio's death. Faustina's share,
Fortifying the rule, the Court had repeatedly emphasized that however, passed on to her daughter Carolina when the former
defenses not pleaded in the answer may not be raised for the first died on October 18, 1949. The Affidavit of Self-
time on appeal. When a party deliberately adopts a certain theory Adjudication executed by Carolina did not prejudice the share of
and the case is decided upon that theory in the court below, he will Agripina because it is not legally possible for one to adjudicate
not be permitted to change the same on appeal, because to permit unto himself an entire property he was not the sole owner of. A co-
him to do so would be unfair to the adverse party. 29 The Court owner cannot alienate the shares of her other co-owners nemo
had likewise, in numerous times, affirmed that points of law, dat qui non habet. 38
theories, issues and arguments not brought to the attention of the Hence, Lot No. 707 was a co-owned property of Agripina and
lower court need not be, and ordinarily will not be, considered by Carolina. As co-owners, each of them had full ownership of her
a reviewing court, as these cannot be raised for the first time at part and of the fruits and benefits pertaining thereto. Each of them
such late stage. Basic considerations of due process underlie this also had the right to alienate the lot but only in so far as the extent
rule. It would be unfair to the adverse party who would have no of her portion was affected. 39
opportunity to present further evidence material to the new theory, Thus, when Carolina sold the entire Lot No. 707 on December 11,
which it could have done had it been aware of it at the time of the 1962 to Hilaria and Felipa without the consent of her co-owner
hearing before the trial court. 30 Agripina, the disposition affected only Carolina's pro
While a party may change his theory on appeal when the factual indiviso share, and the vendees, Hilaria and Felipa, acquired only
bases thereof would not require presentation of any further what corresponds to Carolina's share. A co-owner is entitled to sell
evidence by the adverse party in order to enable it to properly meet his undivided share; hence, a sale of the entire property by one
the issue raised in the new theory, 31 this exception does not, co-owner without the consent of the other co-owners is not null
however, obtain in the case at hand. and void and only the rights of the co-owner/seller are transferred,
Contrary to the petitioners' assertion, the Court finds that the thereby making the buyer a co-owner of the property. 40 IaAEHD
issues on the supposed defects and actual nature of the Deed of Accordingly, the deed of sale executed by Carolina in favor of
Quitclaim are questions of fact that require not only a review or re- Hilaria and Felipa was a valid conveyance but only insofar as the
evaluation of the evidence already adduced by the parties but also share of Carolina in the co-ownership is concerned. As Carolina's
the reception of new evidence as the petitioners themselves have successors-in-interest to the property, Hilaria and Felipa could not
acknowledged when they attached in the petition several acquire any superior right in the property than what Carolina is
certifications 32 in support of their new argument. It is settled that entitled to or could transfer or alienate after partition.
questions of fact are beyond the province of a Rule 45 petition In a contract of sale of co-owned property, what the vendee
since the Court is not a trier of facts. 33 obtains by virtue of such a sale are the same rights as the vendor
Accordingly, the Court will not give due course to the new issues had as co-owner, and the vendee merely steps into the shoes of
raised by the petitioners involving the nature and execution of the vendor as co-owner. 41 Hilaria and Felipa did not acquire the
the Deed of Quitclaim. For their failure to advance these questions undivided portion pertaining to Agripina, which has already been
effectively bequeathed to respondent Emilia as early as November Further, records do not reflect conclusive evidence showing the
28, 1961 thru the Deed of Quitclaim. In turn, being the successor- manner of occupation and possession exercised by Hilaria and
in-interest of Agripina's share in Lot No. 707, respondent Emilia Felipa over the lot from the time it was registered in their names.
took the former's place in the co-ownership and as such co-owner, The only evidence of possession extant in the records dates back
has the right to compel partition at any time. 42 only to 1985 when Hilaria and Felipa declared the lot in their
The respondent's right to demand names for taxation purposes. 50Prescription can only produce all
for partition is not barred by its effects when acts of ownership, or in this case, possession, do
acquisitive prescription or laches not evince any doubt as to the ouster of the rights of the other co-
The petitioners posit that the issuance of TCT No. 42244 in the owners. Hence, prescription among co-owners cannot take place
name of Hilaria and Felipa over Lot No. 707 on December 11, 1962 when acts of ownership exercised are vague or uncertain. 51
was an express repudiation of the co-ownership with respondent Moreover, the evidence relative to the possession, as a fact upon
Emilia. Considering the period of time that has already lapsed which the alleged prescription is based, must be clear, complete
since then, acquisitive prescription has already set in and the and conclusive in order to establish said prescription without any
respondent is now barred by laches from seeking a partition of the shadow of doubt; and when upon trial it is not shown that the
subject lot. possession of the claimant has been adverse and exclusive and
The contention is specious. opposed to the rights of the others, the case is not one of
Co-heirs or co-owners cannot acquire by acquisitive prescription ownership, and partition will lie. 52 The petitioners failed to muster
the share of the other co-heirs or co-owners absent a clear adequate evidence of possession essential for the reckoning of
repudiation of the co ownership. 43 The act of repudiation, as a the 10-year period for acquisitive prescription. IEcDCa
mode of terminating co-ownership, is subject to certain conditions, The express disavowal of the co-ownership did not happen on
to wit: (1) a co-owner repudiates the co-ownership; (2) such an act December 11, 1962 when TCT No. 42244 was issued but in 1994
of repudiation is clearly made known to the other co-owners; (3) when Hilaria attempted to demolish Emilia's house thus explicitly
the evidence thereon is clear and conclusive; and (4) he has been excluding her from the co-ownership. It was the only time that
in possession through open, continuous, exclusive, and notorious Hilaria and Felipa made known their denial of the co-ownership.
possession of the property for the period required by law. 44 On the same year, the respondent instituted the present complaint
The petitioners failed to comply with these conditions. The act of for partition; hence, the period required by law for acquisitive
Hilaria and Felipa in effecting the registration of the entire Lot No. period to set in was not met.
707 in their names thru TCT No. 42244 did not serve to effectively Anent laches, the Court finds it unavailing in this case in view of
repudiate the co-ownership. The respondent built her house on the the proximity of the period when the co-ownership was expressly
eastern portion of the lot in 1981 without any opposition from the repudiated and when the herein complaint was filed. Laches is the
petitioners. Hilaria also paid realty taxes on the lot, in behalf of the negligence or omission to assert a right within a reasonable time,
respondent, for the years 1983-1987. 45 These events indubitably warranting a presumption that the party entitled to assert it has
show that Hilaria and Felipa failed to assert exclusive title in abandoned it or declined to assert it. 53 More so, laches is a
themselves adversely to Emilia. Their acts clearly manifest that creation of equity and its application is controlled by equitable
they recognized the subsistence of their co-ownership with considerations. It cannot be used to defeat justice or perpetrate
respondent Emilia despite the issuance of TCT No. 42244 in 1962. fraud and injustice. Neither should its application be used to
Their acts constitute an implied recognition of the co-ownership prevent the rightful owners of a property from recovering what has
which in turn negates the presence of a clear notice of repudiation been fraudulently registered in the name of another. 54
to the respondent. To sustain a plea of prescription, it must always Partition of Lot No. 707
clearly appear that one who was originally a joint owner has Under the Old Civil Code 55 which was then in force at the time of
repudiated the claims of his co-owners, and that his co-owners Eulalio and Marcela's marriage, Lot No. 707 was their conjugal
were apprised or should have been apprised of his claim of property. 56 When Marcela died, one-half of the lot was
adverse and exclusive ownership before the alleged prescriptive automatically reserved to Eulalio, the surviving spouse, as his
period began to run. 46 THEDcS share in the conjugal partnership. 57 Marcela's rights to the other
In addition, when Hilaria and Felipa registered the lot in their half, in turn, were transmitted to her legitimate child, Agripina and
names to the exclusion of Emilia, an implied trust was created by surviving spouse Eulalio. 58 Under Article 834 of the Old Civil
force of law and the two of them were considered a trustee of the Code, Eulalio was entitled only to the usufruct of the lot while the
respondent's undivided share. 47 As trustees, they cannot be naked ownership belonged to Agripina. When he remarried,
permitted to repudiate the trust by relying on the registration. Eulalio's one half portion of the lot representing his share in the
In Ringor v. Ringor, 48 the Court had the occasion to explain the conjugal partnership and his usufructuary right over the other half
reason for this rule: were brought into his second marriage with Faustina. 59
A trustee who obtains a Torrens title over a property held in When Eulalio died on July 20, 1930, 1/4 portion of the lot was
trust for him by another cannot repudiate the trust by relying reserved for Faustina as her share in the conjugal
on the registration. A Torrens Certificate of Title in Jose's name partnership. 60 The remaining 1/4 were transmitted equally to the
did not vest ownership of the land upon him. The Torrens system widow Faustina and Eulalio's children, Carolina and
does not create or vest title. It only confirms and records title Agripina. 61 However, Faustina is only entitled to the usufruct of
already existing and vested. It does not protect a usurper from the the third available for betterment. 62 IATHaS
true owner. The Torrens system was not intended to foment The usufructuary of Eulalio over the 1/2 portion inherited by
betrayal in the performance of a trust. It does not permit one to Agripina earlier was merged with her naked ownership. 63 Upon
enrich himself at the expense of another. Where one does not the death of Faustina, the shares in Lot No. 707 which represents
have a rightful claim to the property, the Torrens system of her share in the conjugal partnership and her inheritance from
registration can confirm or record nothing. Petitioners cannot rely Eulalio were in turn inherited by Carolina 64 including Faustina's
on the registration of the lands in Jose's name nor in the name of usufructuary rights which were merged with Carolina's naked
the Heirs of Jose M. Ringor, Inc., for the wrong result they seek. ownership. 65
For Jose could not repudiate a trust by relying on a Torrens title he Consequently, Agripina is entitled to 5/8 portion of Lot No. 707
held in trust for his co-heirs. The beneficiaries are entitled to while the remaining 3/8 pertains to Carolina. Thus, when Carolina
enforce the trust, notwithstanding the irrevocability of the Torrens sold Lot No. 707 to Hilaria and Felipa, the sale affected only 3/8
title. The intended trust must be sustained. 49 (Citations omitted portion of the subject lot. Since the Deed of Quitclaim, bequeathed
and emphasis ours) only the 1/2 eastern portion of Lot No. 707 in favor of Emilia instead
of Agripina's entire 5/8 share thereof, the remaining 1/8 portion RESOLUTION
shall be inherited by Agripina's nearest collateral relative, 66 who, BOCOBO, J p:
records show, is her sister Carolina. The intervenor and appellant, the Lopez Sugar Central Mill Co.,
In sum, the CA committed no reversible error in holding that the Inc., moves for a reconsideration of the resolution of this Court
respondent is entitled to have Lot No. 707 partitioned. The CA promulgated on July 20, 1940, in so far as said resolution declared
judgment must, however, be modified to conform to the above- the deed of sale, Exhibit D, void in its entirety and denied certain
discussed apportionment of the lot among Carolina, Hilaria, Felipa remedies prayed for.
and Emilia. In the decision of this Court under date of January 29, 1940, this
WHEREFORE, the petition is DENIED. The Decision of the Court Court held the sale in question void and of no effect in so far as
of Appeals in CA-G.R. CV No. 58290 dated December 11, 2001, the three daughters, Maria Cristina, Josefina and Anita Cuaycong,
is AFFIRMED with MODIFICATIONS as follows: (1) 3/8 portion of were concerned because they had not taken part therein, but valid
Lot No. 707 shall pertain in equal shares to Hilaria Figuracion and as to the widow and other children of Cuaycong who had
Felipa Figuracion-Manuel; (2) 1/2 portion of Lot No. 707 shall consented to the transaction. In said decision, this Court ordered
pertain to Emilia Figuracion-Gerilla; and (3) 1/8 portion of Lot No. intervenor to remove the buildings constructed on Lot 178-B.
707 shall pertain to the estate of Carolina Then, in the resolution dated July 20, 1940, this Court held that
(Carlina) Vda. De Figuracion. The case is REMANDED to the said contract was void in its entirety. The portion of said resolution
Regional Trial Court of Urdaneta, Pangasinan, Branch 49, who is whose reconsideration is sought reads: "And with respect to the
directed to conduct a PARTITION BY COMMISSIONERS and widow of Cuaycong and his children of age, the sale was also void,
effect the actual physical partition of the subject property, as well because they alienated, without a previous partition of
as the improvements that lie therein, in the foregoing manner. The the hacienda, a definite and concrete part thereof, although they
trial court is DIRECTED to appoint not more than three (3) had only an abstract and undivided share of said property."
competent and disinterested persons, who should determine the We shall discuss three questions raised in the motion for
technical metes and bounds of the property and the proper share reconsideration: (1) Was the consent of the three daughters, Maria
appertaining to each co-owner, including the improvements, in Cristina, Josefina and Anita Cuaycong necessary to the sale in
accordance with Rule 69 of the Rules of Court. When it is made to question? (2) What rights did the intervenor acquire in this sale?
appear to the commissioners that the real estate, or a portion (3) Whether the distillery building and other improvements
thereof, cannot be divided without great prejudice to the interest of constructed on Lot 178-B should be removed by the intervenor.
the parties, the court a quo may order it assigned to one of the I
parties willing to take the same, provided he pays to the other On the first question, we believe the consent of the three
parties such sum or sums of money as the commissioners deem daughters above named was not necessary to the validity of the
equitable, unless one of the parties interested ask that the property sale in question. Each coowner may alienate his undivided or ideal
be sold instead of being so assigned, in which case the court shall share in the community.
order the commissioners to sell the real estate at public sale, and Articles 392 and 399 of the Civil Code provide:
the commissioners shall sell the same accordingly, and thereafter "Article 392. There is co-ownership whenever the ownership of a
distribute the proceeds of the sale appertaining to the just share of thing or of a right belongs undivided to different persons.
each co-owner. No pronouncement as to costs. cIHCST "Art. 399. Todo condueo tendra la plena propiedad de su parte y
SO ORDERED. la de los frutos y utilidades que le correspondan, pudiendo en su
||| (Vda. de Figuracion v. Figuracion-Gerilla, G.R. No. 151334, consecuencia enajenarla, cederla o hipotecarla, y aun sustituir
[February 13, 2013], 703 PHIL 455-477) otro en su aprovechamiento, salvo si se tratare de derechos
personales. Pero el efecto de la enajenacion o hipoteca con
LOPEZ v. VDA DE CUAYCONG relacion a los condueos estara limitado a la porcion que se le
FIRST DIVISION adjudique en la division al cesar la comunidad.
[G.R. No. 46079. March 24, 1944.] "Article 399. Each one of the co-owners shall have the absolute
MARIA LOPEZ, plaintiff-appellant, vs. MAGDALENA ownership of his part and that of the fruits and profits pertaining
GONZAGA VDA. DE CUAYCONG ET AL., defendants- thereto, and he may therefore sell, assign or mortgage it, and even
appellees; LOPEZ SUGAR CENTRAL MILL CO., substitute another person in its enjoyment, unless personal rights
INC.,intervenor-appellant. are involved. But the effect of the alienation or mortgage with
SYLLABUS respect to the co-owners shall be limited to the share which may
1. COMMUNITY PROPERTY; RIGHT OF A COOWNER TO be allotted to him in the division upon the termination of the co-
ALIENATE HIS UNDIVIDED SHARE WITHOUT THE CONSENT ownership."
OF HIS COOWNERS. Each coowner may alienate his Manresa has the following to say on this subject:
undivided or ideal share in the community, even without the "Cada condomino lo es del todo, y sobre el todo ejerce derechos
consent of his coowners. dominicales, pero al mismo tiempo es proprietario de una parte
2. ID.; RIGHTS ACQUIRED BY PURCHASERS FROM A realmente abstracta, porque hasta que la division se efectue no
COOWNER. The rights acquired by purchasers from a coowner queda aquella determinada concretamente. Los derechos de los
are the same as those which the grantor had as coowner in an comuneros son, por lo expuesto, todo lo absolutos que el dominio
ideal share in the property held in common. requiere, puesto que aquellos pueden gozar y disponer de la cosa
3. ID.; CONTRACT OF SALE BY COOWNER PURPORTING TO comun, sin otras limitaciones que las de no perjudicar en el
CONVEY CONCRETE PORTION THEREOF, EFFECT OF. ejercicio de su derecho los intereses generales de la comunidad,
The fact that the contract of sale made by a coowner purports to yposeen ademas la plena propiedad de su parte, que pueden
sell a concrete portion of the property held in common, does not enajenar, ceder o hipotecar: parte que, repetimos, no sera cierta
render the sale void, for it is a well-established principle that the hasta el momento de cesar la comunidad. El derecho de
binding force of a contract must be recognized as far as it is legally propiedad, por consiguiente, tal y como lo define el art. 348 del
possible to do so. presente Codigo civil, con sus notas de absoluto y con su caracter
4. ID.; COOWNER'S RIGHTS TO DISPOSE OF HIS SHARE de individualizacion, aparece ejercido en el condominio, sin otra
BEFORE PARTITION, LIMITATION OF. Before partition, diferencia entre la propiedad singular y la comun que la que
conventional or judicial, no coowner may dispose of any physically acertadamente establece el codigo portugues (arts. 2175 y 2176),
identified portion of the common property; and any conveyance by al decir 'que el propietario singular ejerce de modo exclusivo sus
a coowner is subject to the result of a subsequent partition. derechos, y el proprietario en comun los ejerce conjuntamente con
los otros'; pero, aadiremos nosotros, estandole atribuidos al the same as he pleases, because it does not affect the right of the
condomino de modo individual sobre su parte indivisa todos los others. Such quantity is equivalent to a credit against the common
derechos de tal propietario, a mas del uso y disfrute de la cosa, thing or right, and is the private property of each creditor (co-
que es comun a todos los propietarios." (Italics supplied.) owner). The various shares ideally signify as many units of thing
"Each co-owner owns the whole, and over it he exercises rights of or right, pertaining individually to the different owners; in other
dominion, but at the same time he is the owner of a share which is words, a unit for each owner."
really abstract, because until the division is effected, such share is
not concretely determined. The rights of the co-owners are, It follows that the consent of the three daughters Maria Cristina,
therefore, as absolute as dominion requires, because they may Josefina and Anita Cuaycong to the sale in question was not
enjoy and dispose of the common property, without any limitation necessary.
other than that they should not, in the exercise of their right, II
prejudice the general interest of the community, and possess, in The second question is: What rights did the intervenor acquire in
addition, the full ownership of their share, which they may alienate, this sale? The answer is: the same rights as the grantors had as
convey or mortgage: which share, we repeat, will not be certain co- owners in an ideal share equivalent in value to 10,832 square
until the community ceases. The right of ownership, therefore, as meters of the hacienda. No specific portion, physically identified,
defined in Art. 348 of the present Civil Code, with its absolute of the hacienda has been sold, but only an abstract and undivided
features and its individualized character, is exercised in co- share equivalent in value to 10,832 square meters of the common
ownership, with no other differences between sole and common property. What portion of the hacienda has been sold will not be
ownership than that which is rightly established by the Portuguese physically and concretely ascertained until after the division. This
Code (Arts. 2175 and 2176), when it says 'that the sole owner sale is therefore subject to the result of such partition, but this
exercises his rights exclusively, and the co-owner exercises them condition does not render the contract void, for an alienation by
jointly with the other co-owners'; but we shall add, to each co- the co-owner of his ideal share is permitted by law, as already
owner pertains individually, over his undivided share, all the rights indicated. If in the partition this lot 178-B should be adjudicated to
of the owner, aside from the use and enjoyment of the thing, which the intervenor, the problem would be simplified; otherwise, the
is common to all the co-owners." (Italics supplied.) sellers would have to deliver to the intervenor another lot
Manresa further says that in the alienation of his undivided or ideal equivalent in value to Lot No. 178-B. Incidentally, it should be
share, a co-owner does not need the consent of the others. (Vol. stated that according to Rule 71, sec. 4, of the new Rules of Court,
3, pp. 486-487, 3rd Ed.) regarding partition of real estate, the commissioners on partition
Sanchez Roman also says ("Estudios de Derecho Civil", vol. 3, pp. shall set apart the real property "to the several parties in such lots
174-175): or parcels as will be most advantageous and equitable, having due
"Muestra el 399 la integridad esencial del derecho de cada regard to the improvements, situation and quality of the different
condueo en la porcion mental que en el condominio o comunidad parts thereof." (Italics supplied.) Consequently, without deciding
le corresponde." that the commissioners on partition must assign Lot 178-B to
xxx xxx xxx intervenor, we deem it proper to state that if in the partition
". . . el ser condueo o coparticipe de una propiedad no significa proceedings, the commissioners should set apart said lot to
quedar privado de todo reconocimiento de disposicion de la cosa, intervenor, they would be acting within the letter and spirit of the
del libre uso de su derecho dentro de las condiciones provision, just quoted, of Rule 71, sec. 4; and that they will
circunstanciales de tal estado juridico, ni que para ejercer el uso y probably make such adjudication.
disfrute, o el de libre disposicion, sea preciso el previo In the Sentence of December 29, 1905, the Supreme Tribunal of
consentimiento de todos los interesados." Spain declared that the alienation, by a co-owner, of either an
"Article 399 shows the essential integrity of the right of each co- abstract or a concrete part of the property owned in common does
owner in the mental portion which belongs to him in the co- not mean the cessation of the ownership. Said sentence held:
ownership or community. "No es de estimar el primer motivo, porque tal estado de derecho
xxx xxx xxx no desaparece, ni siquiera se desvirtua, con respecto a los
"To be a co-owner of a property does not mean that one is copropietarios entre si, por haber ambos, o alguno de ellos,
deprived of every recognition of the disposal of the thing, of the ejecutado actos que pudieran reputarse no comprendidos en las
free use of his right within the circumstantial conditions of such facultades inherentes a la administracion, unicas que de mutuo
juridical status, nor is it necessary, for the use and enjoyment, or acuerdo se habian conferido en determinados bienes, porque si
the right of free disposal, that the previous consent of all the bien todo condueo puede enajenar, ceder o hipotecar la
interested parties be obtained . . ." propiedad de su parte, el efecto de tal enajenacion esta limitado,
According to Scaevola (Codigo Civil, vol. 7, pp. 154-155): con referencia a los condueos, a la porcion que se le adjudique
"2.a. Derecho absoluto de cada comunero respecto de su parte o ulteriormente, conforme al articulo 399 del Codigo civil, y no
cuota. Respecto de esta se equipara al propietario individual. implica la cesacion de la comunidad, ya se refiera la venta a parte
Es, en efecto, un propietario singular, con todos los derechos abstracta de los bienes, ya a parte concreta y determinada de los
inherentes a tal condicion. La cuota del comunero, o sea la parte mismos, porque esto ultimo, que podra afectar a la forma y
que idealmente le corresponde en la cosa o derecho comun y que condiciones con que en su dia haya de practicarse la particion, no
se halla representada por una cantidad determinada, es suya y altera en manera alguna la situacion juridica de los que poseen
puede disponer de ella como le plazca, porque no afecta al colectivamente, mientras no se realice la division de la cosa
derecho de los demas. Dicha cantidad equivale a un credito contra comun, que se declara no haber tenido efecto." (Italics supplied.)
la cosa o derecho comun, propiedad particular de cada acreedor "The first assignment of error cannot be sustained, because such
(comunero). Las diversas cuotas suponen idealmente otras tantas legal status does not disappear, nor is it impaired, with respect to
unidades de cosa o derecho, pertenecientes de modo singular a the co-owners between themselves simply because both or either
los various propietarios, o sea una unidad a cada dueo." of them executed acts which may be considered as beyond the
"2nd. Absolute right of each co-owner with respect to his part or powers inherent in administration, the only powers which by
share. With respect to the latter, each co-owner is the same as mutual agreement had been conferred as to certain properties,
an individual owner. He is a singular owner, with all the rights inasmuch as although every co-owner may alienate, grant, or
inherent in such condition. The share of the co-owner, that is, the mortgage the ownership of his share, the effect of such alienation
part which ideally belongs to him in the common thing or right and is limited, with reference to the co-owners, to the portion which
is represented by a certain quantity, is his and he may dispose of may be adjudicated to him later, according to Art 399 of the Civil
Code, and does not imply the cessation of the community, whether Yulo, C.J., Horrilleno, Ozaeta, and Paras, JJ., concur.
the sale refers to an abstract part of the property, or to a concrete ||| (Lopez v. Vda. de Cuaycong, G.R. No. 46079 (Resolution),
and definite part thereof, because though in the latter case the [March 24, 1944], 74 PHIL 601-610)
form and conditions of the subsequent partition may be effected,
nevertheless, the juridical situation of the collective owners is not TORRES v. LAPINID
in any way altered so long as the partition of the common property FIRST DIVISION
is not carried out, which is declared not to have taken place." [G.R. No. 187987. November 26, 2014.]
(Italics supplied.) VICENTE TORRES, JR., CARLOS VELEZ, AND THE HEIRS OF
Applying the above doctrine to the instant case, it cannot be said MARIANO VELEZ, NAMELY: ANITA CHIONG VELEZ, ROBERT
that the sale of Lot 178-B to the intervenor had the effect of OSCAR CHIONG VELEZ, SARAH JEAN CHIONG VELEZ AND
partitioning the hacienda and adjudicating that lot to the intervenor. TED CHIONG VELEZ, petitioners, vs. LORENZO LAPINID AND
It merely transferred to the intervenor an abstract share equivalent JESUS VELEZ, respondents.
in value to 10,832 square meters of said hacienda, subject to the DECISION
result of a subsequent partition. The fact that the agreement in PEREZ, J p:
question purported to sell a concrete portion of the hacienda does This is a Petition for Review on Certiorari 1 under Rule 45 of the
not render the sale void, for it is a well-established principle that Rules of Court filed by the petitioners assailing the 30 January
the binding force of a contract must be recognized as far as it is 2009 Decision 2 and 14 May 2009 Resolution 3 of the Twentieth
legally possible to do so. "Quando res non valet ut ago, valeat Division of the Court of Appeals in CA-G.R. CV No. 02390,
quantum valere potest." (When a thing is of no force as I do it, it affirming the 15 October 2007 Decision 4 of the Regional Trial
shall have as much force as it can have.") It is plain that Margarita Court of Cebu City (RTC Cebu City) which dismissed the
G. Vda. de Cuaycong and her children of age intended to sell to complaint for the declaration of nullity of deed of sale against
intervenor no more than what they could legally and rightfully respondent Lorenzo Lapinid (Lapinid).
dispose of, and as they could convey only their ideal share, The facts as reviewed are the following:
equivalent in value to 10,832 square meters of the hacienda, that On 4 February 2006, Vicente V. Torres, Jr. (Vicente), Mariano
ideal share alone must be deemed to have been the subject- Velez (Mariano) 5 and Carlos Velez (petitioners) filed a
matter of the sale in question. They are presumed to know the law Complaint 6 before RTC Cebu City praying for the nullification of
that before partition, conventional or judicial, no coowner may the sale of real property by respondent Jesus Velez (Jesus) in
dispose of any physically identified portion of the common favor of Lapinid; the recovery of possession and ownership of the
property; and that any conveyance by a coowner is subject to the property; and the payment of damages.
result of a subsequent partition. This interpretation of the contract Petitioners alleged in their complaint that they, including Jesus, are
does no harm to the minor daughters, as the sale in question is co-owners of several parcels of land including the disputed Lot No.
subject to the result of the partition which intervenor may demand. 4389 7 located at Cogon, Carcar, Cebu. Sometime in 1993, Jesus
As a successor in interest to an abstract or undivided share of the filed an action for partition of the parcels of land against the
sellers, equivalent in value to 10,832 square meters of the property petitioners and other co-owners before Branch 21 of RTC Cebu
owned in common, the intervenor has the same right as its City. On 13 August 2001, a judgment was rendered based on a
predecessors in interest to demand partition at any time, according compromise agreement signed by the parties wherein they agreed
to article 400 of the Civil Code which reads: that Jesus, Mariano and Vicente were jointly authorized to sell the
"Art. 400. Ningun copropietario estara obligado a permanecer en said properties and receive the proceeds thereof and distribute
la comunidad. Cada uno de ellos podra pedir en cualquier tiempo them to all the co-owners. However, the agreement was later
que se divida la cosa comun. amended to exclude Jesus as an authorized seller. Pursuant to
"Esto no obstante, sera valido el pacto de conservar la cosa their mandate, the petitioners inspected the property and
indivisa por tiempo determinado, que no exceda de diez aos. discovered that Lapinid was occupying a specific portion of the
Este plazo podra prorrogarse por nueva convencion." 3000 square meters of Lot No. 4389 by virtue of a deed of sale
III executed by Jesus in favor of Lapinid. It was pointed out by
The third and remaining question is whether the distillery building petitioner that as a consequence of what they discovered, a
and other improvements constructed on Lot 178-B should be forcible entry case was filed against Lapinid.
removed by the intervenor. It is clear that the sale in question being The petitioners prayed that the deed of sale be declared null and
valid, subject to the result of the partition which the intervenor has void arguing that the sale of a definite portion of a co-owned
a right to demand as a coowner, the intervenor is a builder in good property without notice to the other co-owners is without force and
faith. Hence, if in the partition already discussed, Lot 178-B should effect. Further, the complainants prayed for payment of rental fees
not be adjudicated to the intervenor as a coowner, then article 361 amounting to P1,000.00 per month from January 2004 or from the
of the Civil Code would have to be applied. Said article provides: time of deprivation of property in addition to attorney's fees and
"Art. 361. El dueo del terreno en que se edificare, sembrare o litigation expenses.
plantare de buena fe, tendra derecho a hacer suya la obra, Answering the allegations, Jesus admitted that there was a
siembra o plantacion, previa la indemnizacion establecida en los partition case between him and the petitioners filed in 1993
articulos 453 y 454, o a obligar al que fabrico o planto a pagarle el involving several parcels of land including the contested Lot No.
precio del terreno, y al que sembro la renta correspondiente." 4389. However, he insisted that as early as 6 November 1997, a
Therefore, upon reconsideration we hereby declare the deed of motion 8 was signed by the co-owners (including the petitioners)
sale, Exh. D. valid, binding as it is, not only upon the widow and wherein Lot No. 4389 was agreed to be adjudicated to the co-
her children who consented thereto but also upon her three minor owners belonging to the group of Jesus and the other lots be
daughters Maria Cristina, Josefina and Anita Cuaycong. It is divided to the other co-owners belonging to the group of Torres.
hereby further adjudicated that the intervenor as a coowner has a Jesus further alleged that even prior to the partition and motion,
right to demand partition; that if in the partition, Lot No. 178-B several co-owners in his group had already sold their shares to
should not be adjudicated to the intervenor, then the rights of the him in various dates of 1985, 1990 and 2004. 9 Thus, when the
parties concerned should be governed by article 361 of the Civil motion was filed and signed by the parties on 6 November 1997,
Code, the intervenor being a builder in good faith; and that his rights as a majority co-owner (73%) of Lot No. 4389 became
consequently, our order in the decision of January 29, 1940, consolidated. Jesus averred that it was unnecessary to give notice
requiring intervenor to remove the buildings constructed on said of the sale as the lot was already adjudicated in his favor. He
lot should be and is hereby cancelled and withdrawn. So ordered. clarified that he only agreed with the 2001 Compromise
Agreement believing that it only pertained to the remaining parcels In this case, Jesus can validly alienate his co-owned property in
of land excluding Lot No. 4389. 10 favor of Lapinid, free from any opposition from the co-owners.
On his part, Lapinid admitted that a deed of sale was entered into Lapinid, as a transferee, validly obtained the same rights of Jesus
between him and Jesus pertaining to a parcel of land with an area from the date of the execution of a valid sale. Absent any proof
of 3000 square meters. However, he insisted on the validity of sale that the sale was not perfected, the validity of sale subsists. In
since Jesus showed him several deeds of sale making him a essence, Lapinid steps into the shoes of Jesus as co-owner of an
majority owner of Lot No. 4389. He further denied that he acquired ideal and proportionate share in the property held in
a specific and definite portion of the questioned property, citing as common. 20 Thus, from the perfection of contract on 9 November
evidence the deed of sale which does not mention any boundaries 1997, Lapinid eventually became a co-owner of the property.
or specific portion. He explained that Jesus permitted him to Even assuming that the petitioners are correct in their allegation
occupy a portion not exceeding 3000 square meters conditioned that the disposition in favor of Lapinid before partition was a
on the result of the partition of the co-owners. 11 IcCEDA concrete or definite portion, the validity of sale still prevails.
Regarding the forcible entry case, Jesus and Lapinid admitted that In a catena of decisions, 21 the Supreme Court had repeatedly
such case was filed but the same was already dismissed by the held that no individual can claim title to a definite or concrete
Municipal Trial Court of Carcar, Cebu. In that decision, it was ruled portion before partition of co-owned property. Each co-owner only
that the buyers, including Lapinid, were buyers in good faith since possesses a right to sell or alienate his ideal share after partition.
a proof of ownership was shown to them by Jesus before buying However, in case he disposes his share before partition, such
the property. 12 disposition does not make the sale or alienation null and void.
On 15 October 2007, the trial court dismissed the complaint of What will be affected on the sale is only his proportionate share,
petitioners in this wise: subject to the results of the partition. The co-owners who did not
Therefore, the Court DISMISSES the Complaint. At the same time, give their consent to the sale stand to be unaffected by the
the Court NULLIFIES the site assignment made by Jesus Velez in alienation. 22
the Deed of Sale, dated November 9, 1997, of Lorenzo Lapinid's As explained in Spouses Del Campo v. Court of Appeals: 23
portion, the exact location of which still has to be determined either We are not unaware of the principle that a co-owner cannot
by agreement of the co-owners or by the Court in proper rightfully dispose of a particular portion of a co-owned property
proceedings. 13 prior to partition among all the co-owners. However, this should
Aggrieved, petitioners filed their partial motion for reconsideration not signify that the vendee does not acquire anything at all in case
which was denied through a 26 November 2007 Order of the a physically segregated area of the co-owned lot is in fact sold to
court. 14 Thereafter, they filed a notice of appeal on 10 December him. Since the co-owner/vendor's undivided interest could properly
2007. 15 be the object of the contract of sale between the parties, what the
On 30 January 2009, the Court of Appeals affirmed 16 the vendee obtains by virtue of such a sale are the same rights as the
decision of the trial court. It validated the sale and ruled that the vendor had as co-owner, in an ideal share equivalent to the
compromise agreement did not affect the validity of the sale consideration given under their transaction. In other words, the
previously executed by Jesus and Lapinid. It likewise dismissed vendee steps into the shoes of the vendor as co-owner and
the claim for rental payments, attorney's fees and litigation acquires a proportionate abstract share in the property held in
expenses of the petitioners. common. 24 DSHcTC
Upon appeal before this Court, the petitioners echo the same Also worth noting is the pronouncement in Lopez v. Vda. De
arguments posited before the lower courts. They argue that Cuaycong: 25
Lapinid, as the successor-in-interest of Jesus, is also bound by the . . . The fact that the agreement in question purported to sell
2001 judgment based on compromise stating that the parcels of a concrete portion of the hacienda does not render the sale
land must be sold jointly by Jesus, Mariano and Vicente and the void, for it is a well-established principle that the binding force of a
proceeds of the sale be divided among the co-owners. To further contract must be recognized as far as it is legally possible to do
strengthen their contention, they advance the argument that since so. "Quando res non valet ut ago, valeat quantum valere
the portion sold was a definite and specific portion of a co-owned potest." (When a thing is of no force as I do it, it shall have as much
property, the entire deed of sale must be declared null and void. force as it can have). 26 (Italics theirs).
We deny the petition. Consequently, whether the disposition involves an abstract or
Admittedly, Jesus sold an area of land to Lapinid on 9 November concrete portion of the co-owned property, the sale remains validly
1997. To simplify, the question now is whether Jesus, as a co- executed.
owner, can validly sell a portion of the property he co-owns in favor The validity of sale being settled, it follows that the subsequent
of another person. We answer in the affirmative. compromise agreement between the other co-owners did not
A co-owner has an absolute ownership of his undivided and pro- affect the rights of Lapinid as a co-owner.
indiviso share in the co-owned property. 17 He has the right to Records show that on 13 August 2001, a judgment based on
alienate, assign and mortgage it, even to the extent of substituting compromise agreement was rendered with regard to the previous
a third person in its enjoyment provided that no personal rights will partition case involving the same parties pertaining to several
be affected. This is evident from the provision of the Civil Code: parcels of land, including the disputed lot. The words of the
Art. 493. Each co-owner shall have the full ownership of his part compromise state that:
and of the fruits and benefits pertaining thereto, and he may COME NOW[,] the parties and to this Honorable Court, most
therefore alienate, assign or mortgage it, and even substitute respectfully state that instead of partitioning the properties, subject
another person in its enjoyment, except when personal rights are matter of litigation, that they will just sell the properties covered by
involved. But the effect of the alienation or the mortgage, with TCT Nos. 25796, 25797 and 25798 of the Register of Deeds of the
respect to the co-owners, shall be limited to the portion which may Province of Cebu and divide the proceeds among themselves.
be allotted to him in the division upon the termination of the co- That Jesus Velez, Mariano Velez and Vicente Torres, Jr. are
ownership. currently authorized to sell said properties, receive the proceeds
A co-owner is an owner of the whole and over the whole he thereof and distribute them to the parties. 27
exercises the right of dominion, but he is at the same time the Be that as it may, the compromise agreement failed to defeat the
owner of a portion which is truly abstract. 18 Hence, his co-owners already accrued right of ownership of Lapinid over the share sold
have no right to enjoin a co-owner who intends to alienate or by Jesus. As early as 9 November 1997, Lapinid already became
substitute his abstract portion or substitute a third person in its a co-owner of the property and thus, vested with all the rights
enjoyment. 19 enjoyed by the other co-owners. The judgment based on the
compromise agreement, which is to have the covered properties 7. In actions for the recovery of wages of household helpers,
sold, is valid and effectual provided as it does not affect the laborers and skilled workers;
proportionate share of the non-consenting party. Accordingly, 8. In actions for indemnity under workmen's compensation and
when the compromise agreement was executed without Lapinid's employer's liability laws;
consent, said agreement could not have affected his ideal and 9. In a separate civil action to recover civil liability arising from a
undivided share. Petitioners cannot sell Lapinid's share absent his crime;
consent. Nemo dat quod non habet "no one can give what he 10. When at least double judicial costs are awarded;
does not have." 28 11. In any other case where the court deems it just and equitable
This Court has ruled in many cases that even if a co-owner sells that attorney's fees and expenses of litigation should be
the whole property as his, the sale will affect only his own share recovered.
but not those of the other co-owners who did not consent to the In all cases, the attorney's fees and expenses of litigation must be
sale. This is because the sale or other disposition of a co-owner reasonable.
affects only his undivided share and the transferee gets only what Petitioners cite Jesus' act of selling a definite portion to Lapinid as
would correspond to his grantor in the partition of the thing owned the reason which forced theirs to litigate and file their complaint.
in common. 29 However, though the Court may not fault the complainants when
We find unacceptable the argument that Lapinid must pay rental they filed a complaint based on their perceived cause of action,
payments to the other co-owners. they should have also considered thoroughly that it is well within
As previously discussed, Lapinid, from the execution of sale, the rights of a co-owner to validly sell his ideal share pursuant to
became a co-owner vested with rights to enjoy the property held law and jurisprudence.
in common. WHEREFORE, the petition is DENIED. Accordingly, the Decision
Clearly specified in the Civil Code are the following rights: and Resolution of the Court of Appeals dated 30 January 2009 and
Art. 486. Each co-owner may use the thing owned in common, 14 May 2009 are hereby AFFIRMED.
provided he does so in accordance with the purpose for which it is SO ORDERED.
intended and in such a way as not to injure the interest of the co- ||| (Torres, Jr. v. Lapinid, G.R. No. 187987, [November 26, 2014])
ownership or prevent the other co-owners from using it according
to their rights. The purpose of the co-ownership may be changed ARAMBULO v. NOLASCO
by agreement, express or implied. SECOND DIVISION
Art. 493. Each co-owner shall have the full ownership of his part [G.R. No. 189420. March 26, 2014.]
and of the fruits and benefits pertaining thereto, and he may RAUL V. ARAMBULO AND TERESITA A. DELA
therefore alienate, assign or mortgage it and even substitute CRUZ, petitioners, vs. GENARO NOLASCO AND JEREMY
another person in its enjoyment, except when personal rights are SPENCER NOLASCO, respondents.
involved. But the effect of the alienation or mortgage, with respect DECISION
to the co-owners, shall be limited to the portion which may be PEREZ, J p:
allotted to him in the division upon the termination of the co- This is a Petition for Review of the 7 October 2008 Decision 1 and
ownership. 30 July 2009 Resolution 2 of the Court of Appeals in CA-G.R. CV
Affirming these rights, the Court held in Aguilar v. Court of No. 76449, which reversed and set aside the Decision 3 of the
Appeals that: 30 Regional Trial Court (RTC) of Manila, Branch 51, dated 19
. . . Each co-owner of property held pro indiviso exercises his September 2002.
rights over the whole property and may use and enjoy the same Petitioners Raul V. Arambulo and Teresita A. Dela Cruz, along
with no other limitation than that he shall not injure the interests of with their mother Rosita Vda. de Arambulo, and siblings
his co-owners, the reason being that until a division is made, the Primo V. Arambulo, Ma. Lorenza A. Lopez, Ana
respective share of each cannot be determined and every co- Maria V. Arambulo, Maximiano V. Arambulo,
owner exercises, together with his co-participants joint ownership Julio V. Arambulo and Iraida Arambulo Nolasco (Iraida) are co-
over the pro indiviso property, in addition to his use and enjoyment owners of two (2) parcels of land located in Tondo, Manila, with an
of the same. 31 aggregate size of 233 square meters. When Iraida passed away,
From the foregoing, it is absurd to rule that Lapinid, who is already she was succeeded by her husband, respondent
a co-owner, be ordered to pay rental payments to his other co- Genaro Nolasco and their children, Iris Abegail Nolasco, Ingrid
owners. Lapinid's right of enjoyment over the property owned in Aileen Arambuloand respondent Jeremy Spencer Nolasco.
common must be respected despite opposition and may not be On 8 January 1999, petitioners filed a petition for relief under
limited as long he uses the property to the purpose for which it is Article 491 of the Civil Code with the RTC of Manila, alleging that
intended and he does not injure the interest of the co- all of the co-owners, except for respondents, have authorized
ownership. ADEaHT petitioners to sell their respective shares to the subject properties;
Finally, we find no error on denial of attorney's fees and litigation that only respondents are withholding their consent to the sale of
expenses. their shares; that in case the sale pushes through, their mother
Pursuant to Article 2208 of the New Civil Code, attorney's fees and and siblings will get their respective 1/9 share of the proceeds of
expenses of litigation, in the absence of stipulation, are awarded the sale, while respondents will get 1/4 share each of the 1/9 share
only in the following instances: of Iraida; that the sale of subject properties constitutes alteration;
xxx xxx xxx and that under Article 491 of the Civil Code,if one or more co-
1. When exemplary damages are awarded; owners shall withhold their consent to the alterations in the thing
2. When the defendant's act or omission has compelled the owned in common, the courts may afford adequate relief. 4
plaintiff to litigate with third persons or to incur expenses In their Answer, respondents sought the dismissal of the petition
to protect his interests; for being premature. Respondents averred that they were not
3. In criminal cases of malicious prosecution against the plaintiff; aware of the intention of petitioners to sell the properties they co-
4. In case of a clearly unfounded civil action or proceeding against owned because they were not called to participate in any
the plaintiff; negotiations regarding the disposition of the property. 5
5. Where the defendant acted in gross and evident bad faith in After the pre-trial, two (2) issues were submitted for consideration:
refusing to satisfy the plaintiff's plainly valid and demandable 1. Whether or not respondents are withholding their consent in the
claim; sale of the subject properties; and ECaScD
6. In actions for legal support;
2. In the affirmative, whether or not withholding of consent of sale The Court of Appeals correctly applied the provision of Article 493
by the respondents is prejudicial to the petitioners. 6 of the Civil Code,which states: ECSHAD
On 19 September 2002, the trial court ruled in favor of petitioners Art. 493. Each co-owner shall have the full ownership of his part
and ordered respondents to give their consent to the sale. The and of the fruits and benefits pertaining thereto, and he may
dispositive portion of the decision reads: therefore alienate, assign or mortgage it, and even substitute
WHEREFORE, in view of the foregoing, judgment is hereby another person in its enjoyment, except when personal rights are
rendered in favor of the petitioners and against the respondents: involved. But the effect of the alienation or the mortgage, with
1. Directing respondents Genaro Nolasco and Jeremy Spencer respect to the co-owners, shall be limited to the portion which may
A. Nolasco to give their consent to the sale of their shares on the be allotted to him in the division upon the termination of the co-
subject properties; ownership.
2. Allowing the sale of the aforementioned properties; Upon the other hand, Article 491 states:
3. Directing the petitioners and the co-owners, including the Art. 491. None of the co-owners shall, without the consent of the
respondents herein to agree with the price in which the subject others, make alterations in the thing owned in common, even
properties are to be sold and to whom to be sold; and though benefits for all would result therefrom. However, if the
4. Directing the distribution of the proceeds of the sale of the withholding of the consent by one or more of the co-owners is
aforementioned properties in the following proportion: clearly prejudicial to the common interest, the courts may afford
a.) Rosita V. Vda. de Arambulo 1/9 adequate relief.
b.) Primo V. Arambulo 1/9 As intimated above, the erroneous application of Article 491 is, in
c.) Maximiano V. Arambulo 1/9 this case, an innate infirmity. The very initiatory pleading below
d.) Ana Maria V. Arambulo 1/9 was captioned Petition for Relief under Article 491 of the New Civil
e.) Ma. Lorenza A. Lopez 1/9 Code. Petitioners, likewise petitioners before the RTC, filed the
f.) Julio V. Arambulo 1/9 case on the submission that Article 491 covers the petition and
g.) Raul V. Arambulo 1/9 grants the relief prayed for, which is to compel the respondent co-
h.) Teresita A. dela Cruz 1/9 owners to agree to the sale of the co-owned property. The trial
i.) Genaro Nolasco, Jr. 1/4 of 1/9 court took up all that petitioners tendered, and it favored the
j.) Jeremy Spencer A. Nolasco 1/4 of 1/9 pleading with the finding that:
k.) Iris Abegail A. Nolasco 1/4 of 1/9 . . . To this court, the act of respondents of withholding consent to
l.) Ingrid Aileen Arambulo 1/4 of 1/9 7 the sale of the properties is not only prejudicial to the common
Going along with petitioners' reliance on Article 491 of the Civil interest of the co-owners but is also considered as an alteration
Code,the trial court found that respondents' withholding of their within the purview of Article 491 of the New Civil Code. . . . . Hence,
consent to the sale of their shares is prejudicial to the common it is deemed just and proper to afford adequate relief to herein
interest of the co-owners. petitioners under Article 491 of the New Civil Code. 8
Respondents filed a Notice of Appeal and the trial court gave due That a sale constitutes an alteration as mentioned in Article 491 is
course to the appeal and the entire records of the case were an established jurisprudence. It is settled that alterations include
elevated to the Court of Appeals. any act of strict dominion or ownership and any encumbrance or
In a Decision dated 7 October 2008, the Court of Appeals granted disposition has been held implicitly to be an act of
the appeal and reversed the trial court's decision. The Court of alteration. 9 Alienation of the thing by sale of the property is an act
Appeals held that the respondents had the full ownership of their of strict dominion. 10 However, the ruling that alienation is
undivided interest in the subject properties, thus, they cannot be alteration does not mean that a sale of commonly owned real
compelled to sell their undivided shares in the properties. It property is covered by the second paragraph of Article 491, such
referred to the provisions of Article 493 of the Civil Code.However, that if a co-owner withholds consent to the sale, the courts, upon
the Court of Appeals, implying applicability of Article 491 also a showing of a clear prejudice to the common interest, may, as
observed that petitioners failed to show how respondents' adequate relief, order the grant of the withheld consent. Such is
withholding of their consent would prejudice the common interest the conclusion drawn by the trial court, and hinted at, if not relied
over the subject properties. upon, by the appellate court.
Hence, the instant petition seeking the reversal of the appellate Ruling that the trial court erred in its conclusion, the Court of
court's decision and praying for the affirmance of the trial court's Appeals correctly relied on Article 493 in support of the finding that
decision that ordered respondents to give their consent to the sale respondents cannot be compelled to agree with the sale. We affirm
of the subject properties. Petitioners emphasize that under Article the reversal by the Court of Appeals of the judgment of the trial
491 of the Civil Code,they may ask the court to afford them court.
adequate relief should respondents refuse to sell their respective 1. There is co-ownership whenever, as in this case, the ownership
shares to the co-owned properties. They refute the appellate of an undivided thing, belongs to different persons. 11 Article 493
court's finding that they failed to show how the withholding of of the Code defines the ownership of the co-owner, clearly
consent by respondents becomes prejudicial to their common establishing that each co-owner shall have full ownership of his
interest. Citing the testimony of petitioner Teresita A. Dela Cruz, part and of its fruits and benefits.
they assert that one of the two subject properties has an area of Pertinent to this case, Article 493 dictates that each one of the
122 square meters and if they decide to partition, instead of selling parties herein as co-owners with full ownership of their parts can
the same, their share would be reduced to a measly 30-square sell their fully owned part. The sale by the petitioners of their parts
meter lot each. The other property was testified to as measuring shall not affect the full ownership by the respondents of the part
only 111 square meters. Petitioners reiterate that all the other co- that belongs to them. Their part which petitioners will sell shall be
owners are willing to sell the property and give respondents their that which may be apportioned to them in the division upon the
share of the proceeds of the sale. termination of the co-ownership. With the full ownership of the
At the core of this petition is whether respondents, as co-owners, respondents remaining unaffected by petitioners' sale of their
can be compelled by the court to give their consent to the sale of parts, the nature of the property, as co-owned, likewise stays. In
their shares in the co-owned properties. Until it reached this Court, lieu of the petitioners, their vendees shall be co-owners with the
the discussion of the issue moved around Article 491 of the Civil respondents. The text of Article 493 says so.
Code.We have to remove the issue out of the coverage of Article 2. Our reading of Article 493 as applied to the facts of this case is
491. It does not apply to the problem arising out of the proposed a reiteration of what was pronounced in Bailon-Casilao v. Court of
sale of the property co-owned by the parties in this case.
Appeals. 12 The rights of a co-owner of a certain property are 3. Indeed, the respected commentaries suggest the conclusion
clearly specified in Article 493 of the Civil Code.Thus: ECTAHc that, insofar as the sale of co-owned properties is concerned, there
Art. 493. Each co-owner shall have the full ownership of his is no common interest that may be prejudiced should one or more
part and of the fruits and benefits pertaining thereto, and he may of the co-owners refuse to sell the co-owned property, which is
therefore alienate, assign or mortgage it[,] and even substitute exactly the factual situation in this case. When respondents
another person in its enjoyment, except when personal rights are disagreed to the sale, they merely asserted their individual
involved. But the effect of the alienation or [the] mortgage, with ownership rights. Without unanimity, there is no common interest.
respect to the co-owners, shall be limited to the portion which may Petitioners who project themselves as prejudiced co-owners may
be allotted to him in the division upon the termination of the co- bring a suit for partition, which is one of the modes of extinguishing
ownership. co-ownership. Article 494 of the Civil Codeprovides that no co-
As early as 1923, this Court has ruled that even if a co-owner sells owner shall be obliged to remain in the co-ownership, and that
the whole property as his, the sale will affect only his own share each co-owner may demand at any time partition of the thing
but not those of the other co-owners who did not consent to the owned in common insofar as his share is concerned. Corollary to
sale. 13 This is because under the this rule, Article 498 of the Civil Code states that whenever the
aforementioned codal provision, the sale or other disposition thing is essentially indivisible and the co-owners cannot agree that
affects only his undivided share and the transferee gets only what it be allotted to one of them who shall indemnify the others, it shall
would correspond to his grantor in the partition of the thing owned be sold and its proceeds accordingly distributed. This is resorted
in common. 14 Consequently, by virtue of the sales made by to (a) when the right to partition the property is invoked by any of
Rosalia and Gaudencio Bailon which are valid with respect to their the co-owners but because of the nature of the property, it cannot
proportionate shares, and the subsequent transfers which be subdivided or its subdivision would prejudice the interests of
culminated in the sale to private respondent Celestino Afable, the the co-owners, and (b) the co-owners are not in agreement as to
said Afable thereby became a co-owner of the disputed parcel of who among them shall be allotted or assigned the entire property
land as correctly held by the lower court since the sales produced upon proper reimbursement of the co-owners. 22 This is the result
the effect of substituting the buyers in the enjoyment thereof. 15 obviously aimed at by petitioners at the outset. As already shown,
From the foregoing, it may be deduced that since a co-owner is this cannot be done while the co-ownership exists.
entitled to sell his undivided share, a sale of the entire property by Essentially, a partition proceeding accords all parties the
one co-owner without the consent of the other co-owners is not opportunity to be heard, the denial of which was raised as a
null and void. However, only the rights of the co-owner-seller are defense by respondents for opposing the sale of the subject
transferred, thereby making the buyer a co-owner of the properties.
property. 16 (Italics theirs). The necessity of partition could not be more emphasized than
Nearer to the dispute at hand are the pronouncements in the 1944 in Rodriguez v. Court of First Instance of Rizal, 23 to wit: cAaETS
case of Lopez v. Vda. de Cuaycong. 17 Citing Manresa on Article . . . That this recourse would entail considerable time, trouble and
399 which is the present Article 493 of the Civil Code,the Court expense, unwarranted by the value of the property from the
said: standpoint of the [respondents], is no legal justification for the
. . . Article 399 shows the essential integrity of the right of each co- apportionment of the property not agreeable to any of the co-
owner in the mental portion which belongs to him in the ownership owners. Disagreements and differences impossible of adjustment
or community. by the parties themselves are bound to arise, and it is precisely
xxx xxx xxx with such contingency in view that the law on partition was
To be a co-owner of a property does not mean that one is deprived evolved. 24
of every recognition of the disposal of the thing, of the free use of WHEREFORE, based on the foregoing, the petition
his right within the circumstantial conditions of such judicial status, is DENIED without prejudice to the filing of an action for partition.
nor is it necessary, for the use and enjoyment, or the right of free The Decision of the Court of Appeals in CA-G.R. CV No. 76449
disposal, that the previous consent of all the interested parties be is AFFIRMED.
obtained. 18(Underscoring supplied). SO ORDERED.
The Court in Lopez further cited Scaevola: ||| (Arambulo v. Nolasco, G.R. No. 189420, [March 26, 2014], 730
2nd. Absolute right of each co-owner with respect to his part or PHIL 464-474)
share. With respect to the latter, each co-owner is the same as
an individual owner. He is a singular owner, with all the rights
inherent in such condition. The share of the co-owner, that is, the
part which ideally belongs to him in the common thing or right and
is represented by a certain quantity, is his and he may dispose of
the same as he pleases, because it does not affect the right of the
others. Such quantity is equivalent to a credit against the common
thing or right and is the private property of each creditor (co-
owner). The various shares ideally signify as many units of thing
or right, pertaining individually to the different owners; in other
words, a unit for each owner. 19 (Underscoring supplied).
The ultimate authorities in civil law, recognized as such by the
Court, agree that co-owners such as respondents have over their
part, the right of full and absolute ownership. Such right is the
same as that of individual owners which is not diminished by the
fact that the entire property is co-owned with others. That part
which ideally belongs to them, or their mental portion, may be
disposed of as they please, independent of the decision of their
co-owners. So we rule in this case. The respondents cannot be
ordered to sell their portion of the co-owned properties. In the
language of Rodriguez v. Court of First Instance of Rizal, 20 "each
party is the sole judge of what is good for him." 21
CRUZ v. CATAPANG After petitioner's motion for reconsideration was denied by the
SECOND DIVISION Court of Appeals in a Resolution dated June 11, 2004, she filed
[G.R. No. 164110. February 12, 2008.] the instant petition.
LEONOR B. CRUZ, petitioner, vs. TEOFILA Raised before us for consideration are the following issues:
M. CATAPANG, respondent. I.
DECISION WHETHER OR NOT THE KNOWLEDGE AND CONSENT OF
QUISUMBING, J p: CO-OWNER NORMA MALIGAYA IS A VALID LICENSE FOR
This petition for review seeks the reversal of the Decision 1 dated THE RESPONDENT TO ERECT THE BUNGALOW HOUSE ON
September 16, 2003 and the Resolution 2 dated June 11, 2004 of THE PREMISES OWNED PRO-INDIVISO SANS CONSENT
the Court of Appeals in CA-G.R. SP No. 69250. The Court of FROM THE PETITIONER AND OTHE[R] CO-OWNER[.]
Appeals reversed the Decision 3 dated October 22, 2001 of the II.
Regional Trial Court (RTC), Branch 86, Taal, Batangas, which had WHETHER OR NOT RESPONDENT, BY HER ACTS, HAS
earlier affirmed the Decision 4 dated September 20, 1999 of the ACQUIRED EXCLUSIVE OWNERSHIP OVER THE PORTION
7th Municipal Circuit Trial Court (MCTC) of Taal, Batangas OF THE LOT SUBJECT OF THE PREMISES PURSUANT TO
ordering respondent to vacate and deliver possession of a portion THE CONSENT GRANTED UNTO HER BY CO-OWNER NORMA
of the lot co-owned by petitioner, Luz Cruz and Norma Maligaya. MALIGAYA TO THE EXCLUSION OF THE PETITIONER AND
The antecedent facts of the case are as follows. THE OTHER CO-OWNER. 14
Petitioner Leonor B. Cruz, Luz Cruz and Norma Maligaya are the III.
co-owners of a parcel of land covering an area of 1,435 square . . . WHETHER OR NOT RESPONDENT IN FACT OBTAINED
meters located at Barangay Mahabang Ludlod, Taal, POSSESSION OF THE PROPERTY IN QUESTION BY MEANS
Batangas. 5 With the consent of Norma Maligaya, one of the OF SIMPLE STRATEGY. 15
aforementioned co-owners, respondent Teofila M. Catapang built Petitioner prays in her petition that we effectively reverse the Court
a house on a lot adjacent to the abovementioned parcel of land of Appeals' decision.
sometime in 1992. The house intruded, however, on a portion of Simply put, the main issue before us is whether consent given by
the co-owned property. 6 a co-owner of a parcel of land to a person to construct a house on
In the first week of September 1995, petitioner Leonor the co-owned property warrants the dismissal of a forcible entry
B. Cruz visited the property and was surprised to see a part of case filed by another co-owner against that person.
respondent's house intruding unto a portion of the co-owned In her memorandum, 16 petitioner contends that the consent and
property. She then made several demands upon respondent to knowledge of co-owner Norma Maligaya cannot defeat the action
demolish the intruding structure and to vacate the portion for forcible entry since it is a basic principle in the law of co-
encroaching on their property. The respondent, however, refused ownership that no individual co-owner can claim title to any definite
and disregarded her demands. 7 portion of the land or thing owned in common until partition.
On January 25, 1996, the petitioner filed a complaint 8 for forcible On the other hand, respondent in her memorandum 17 counters
entry against respondent before the 7th MCTC of Taal, Batangas. that the complaint for forcible entry cannot prosper because her
The MCTC decided in favor of petitioner, ruling that consent of only entry into the property was not through strategy or stealth due to
one of the co-owners is not sufficient to justify defendant's the consent of one of the co-owners. She further argues that since
construction of the house and possession of the portion of the lot Norma Maligaya is residing in the house she built, the issue is not
in question. 9 The dispositive portion of the MCTC decision reads: just possession de facto but also one of possession de jure since
WHEREFORE, judgment is hereby rendered ordering the it involves rights of co-owners to enjoy the property.
defendant or any person acting in her behalf to vacate and deliver As to the issue of whether or not the consent of one co-owner will
the possession of the area illegally occupied to the plaintiff; warrant the dismissal of a forcible entry case filed by another co-
ordering the defendant to pay plaintiff reasonable attorney's fees owner against the person who was given the consent to construct
of P10,000.00, plus costs of suit. a house on the co-owned property, we have held that a co-owner
SO ORDERED. 10 cannot devote common property to his or her exclusive use to the
On appeal, the RTC, Branch 86, Taal, Batangas, affirmed the prejudice of the co-ownership. 18 In our view, a co-owner cannot
MCTC's ruling in a Decision dated October 22, 2001, the give valid consent to another to build a house on the co-owned
dispositive portion of which states: property, which is an act tantamount to devoting the property to his
Wherefore, premises considered, the decision [appealed] from is or her exclusive use.
hereby affirmed in toto. Furthermore, Articles 486 and 491 of the Civil Code provide:
SO ORDERED. 11 Art. 486. Each co-owner may use the thing owned in common,
After her motion for reconsideration was denied by the RTC, provided he does so in accordance with the purpose for which it is
respondent filed a petition for review with the Court of Appeals, intended and in such a way as not to injure the interest of the co-
which reversed the RTC's decision. The Court of Appeals held that ownership or prevent the other co-owners from using it according
there is no cause of action for forcible entry in this case because to their rights. The purpose of the co-ownership may be changed
respondent's entry into the property, considering the consent given by agreement, express or implied.
by co-owner Norma Maligaya, cannot be characterized as one Art. 491. None of the co-owners shall, without the consent of the
made through strategy or stealth which gives rise to a cause of others, make alterations in the thing owned in common, even
action for forcible entry. 12 The Court of Appeals' decision further though benefits for all would result therefrom. However, if the
held that petitioner's remedy is not an action for ejectment but an withholding of the consent by one or more of the co-owners is
entirely different recourse with the appropriate forum. The Court of clearly prejudicial to the common interest, the courts may afford
Appeals disposed, thus: adequate relief.
WHEREFORE, premises considered, the instant Petition is Article 486 states each co-owner may use the thing owned in
hereby GRANTED. The challenged Decision dated 22 October common provided he does so in accordance with the purpose for
2001 as well as the Order dated 07 January 2002 of the Regional which it is intended and in such a way as not to injure the interest
Trial Court of Taal, Batangas, Branch 86, are of the co-ownership or prevent the other co-owners from using it
hereby REVERSED and SET ASIDE and, in lieu thereof, another according to their rights. Giving consent to a third person to
is entered DISMISSING the complaint for forcible entry docketed construct a house on the co-owned property will injure the interest
as Civil Case No. 71-T. of the co-ownership and prevent other co-owners from using the
SO ORDERED. 13 property in accordance with their rights.
Under Article 491, none of the co-owners shall, without the Southern Leyte, Branch 25, dated August 11, 2000, in Civil Case
consent of the others, make alterations in the thing owned in No. R-2878. The resolution of the Court of Appeals dated February
common. It necessarily follows that none of the co-owners can, 23, 2004, which denied petitioners' motion for reconsideration, is
without the consent of the other co-owners, validly consent to the likewise herein assailed.
making of an alteration by another person, such as respondent, in The facts as found by the trial court and the appellate court are
the thing owned in common. Alterations include any act of strict well established. ACcaET
dominion or ownership and any encumbrance or disposition has Rufino Cabales died on July 4, 1966 and left a 5,714-square meter
been held implicitly to be an act of alteration. 19 The construction parcel of land located in Brgy. Rizal, Sogod, Southern Leyte,
of a house on the co-owned property is an act of dominion. covered by Tax Declaration No. 17270 to his surviving wife
Therefore, it is an alteration falling under Article 491 of the Civil Saturnina and children Bonifacio, Albino, Francisco, Leonora,
Code. There being no consent from all co-owners, respondent had Alberto and petitioner Rito.
no right to construct her house on the co-owned property. On July 26, 1971, brothers and co-owners Bonifacio, Albino and
Consent of only one co-owner will not warrant the dismissal of the Alberto sold the subject property to Dr. Cayetano Corrompido for
complaint for forcible entry filed against the builder. The consent P2,000.00, with right to repurchase within eight (8) years. The
given by Norma Maligaya in the absence of the consent of three (3) siblings divided the proceeds of the sale among
petitioner and Luz Cruz did not vest upon respondent any right to themselves, each getting a share of P666.66.
enter into the co-owned property. Her entry into the property still The following month or on August 18, 1971, Alberto secured a note
falls under the classification "through strategy or stealth". ("vale") from Dr. Corrompido in the amount of P300.00. cSaADC
The Court of Appeals held that there is no forcible entry because In 1972, Alberto died leaving his wife and son, petitioner Nelson.
respondent's entry into the property was not through strategy or On December 18, 1975, within the eight-year redemption period,
stealth due to the consent given to her by one of the co-owners. Bonifacio and Albino tendered their payment of P666.66 each to
We cannot give our imprimatur to this sweeping conclusion. Dr. Corrompido. But Dr. Corrompido only released the document
Respondent's entry into the property without the permission of of sale with pacto de retro after Saturnina paid for the share of her
petitioner could appear to be a secret and clandestine act done in deceased son, Alberto, including his "vale" of P300.00. CcHDSA
connivance with co-owner Norma Maligaya whom respondent On even date, Saturnina and her four (4) children Bonifacio,
allowed to stay in her house. Entry into the land effected Albino, Francisco and Leonora sold the subject parcel of land to
clandestinely without the knowledge of the other co-owners could respondents-spouses Jesus and Anunciacion Feliano for
be categorized as possession by stealth. 20 Moreover, P8,000.00. The Deed of Sale provided in its last paragraph, thus:
respondent's act of getting only the consent of one co-owner, her It is hereby declared and understood that the amount of TWO
sister Norma Maligaya, and allowing the latter to stay in the THOUSAND TWO HUNDRED EIGHTY SIX PESOS (2,286.00)
constructed house, can in fact be considered as a strategy which corresponding and belonging to the Heirs of Alberto Cabales and
she utilized in order to enter into the co-owned property. As such, to Rito Cabales who are still monitors upon the execution of this
respondent's acts constitute forcible entry. instrument are held in trust by the VENDEE and to be paid and
Petitioner's filing of a complaint for forcible entry, in our view, was delivered only to them upon reaching the age of 21.
within the one-year period for filing the complaint. The one-year On December 17, 1985, the Register of Deeds of Southern Leyte
period within which to bring an action for forcible entry is generally issued Original Certificate of Title No. 17035 over the purchased
counted from the date of actual entry to the land. However, when land in the names of respondents-spouses.
entry is made through stealth, then the one-year period is counted On December 30, 1985, Saturnina and her four (4) children
from the time the petitioner learned about it. 21 Although executed an affidavit to the effect that petitioner Nelson would only
respondent constructed her house in 1992, it was only in receive the amount of P176.34 from respondents-spouses when
September 1995 that petitioner learned of it when she visited the he reaches the age of 21 considering that Saturnina paid Dr.
property. Accordingly, she then made demands on respondent to Corrompido P966.66 for the obligation of petitioner Nelson's late
vacate the premises. Failing to get a favorable response, petitioner father Alberto, i.e., P666.66 for his share in the redemption of the
filed the complaint on January 25, 1996, which is within the one- sale with pacto de retro as well as his "vale" of P300.00. DIETcC
year period from the time petitioner learned of the construction. On July 24, 1986, 24-year old petitioner Rito Cabales
acknowledged receipt of the sum of P1,143.00 from respondent
WHEREFORE, the petition is GRANTED. The Decision dated Jesus Feliano, representing the former's share in the proceeds of
September 16, 2003 and the Resolution dated June 11, 2004 of the sale of subject property.
the Court of Appeals in CA-G.R. SP No. 69250 are REVERSED In 1988, Saturnina died. Petitioner Nelson, then residing in Manila,
and SET ASIDE. The Decision dated October 22, 2001 of the went back to his father's hometown in Southern Leyte. That same
Regional Trial Court, Branch 86, Taal, Batangas is REINSTATED. year, he learned from his uncle, petitioner Rito, of the sale of
Costs against respondent. subject property. In 1993, he signified his intention to redeem the
SO ORDERED. subject land during a barangay conciliation process that he
||| (Cruz v. Catapang, G.R. No. 164110, [February 12, 2008], 568 initiated.
PHIL 472-480) On January 12, 1995, contending that they could not have sold
their respective shares in subject property when they were minors,
CABALES v. CA petitioners filed before the Regional Trial Court of Maasin,
FIRST DIVISION Southern Leyte, a complaint for redemption of the subject land
[G.R. No. 162421. August 31, 2007.] plus damages. DTIcSH
NELSON CABALES and RITO CABALES, petitioners, vs. In their answer, respondents-spouses maintained that petitioners
COURT OF APPEALS, JESUS FELIANO and ANUNCIACION were estopped from claiming any right over subject property
FELIANO, respondents. considering that (1) petitioner Rito had already received the
DECISION amount corresponding to his share of the proceeds of the sale of
PUNO, C.J p: the project property, and (2) that petitioner Nelson failed to consign
This is a petition for review on certiorari seeking the reversal of the to the court the total amount of the redemption price necessary for
decision 1 of the Court of Appeals dated October 27, 2003, in CA- legal redemption. They prayed for the dismissal of the case on the
G.R. CV No. 68319 entitled "Nelson Cabales and Rito Cabales v. grounds of laches and prescription.
Jesus Feliano and Anunciacion Feliano," which affirmed with No amicable settlement was reached at pre-trial. Trial ensued and
modification the decision 2 of the Regional Trial Court of Maasin, on August 11, 2000, the trial court ruled against petitioners. It held
that (1) Alberto or, by his death, any of his heirs including petitioner petitioner Nelson, retained ownership over their pro-
Nelson lost their right to subject land when not one of them indiviso share.
repurchased it from Dr. Corrompido; (2) Saturnina was effectively Upon redemption from Dr. Corrompido, the subject property was
subrogated to the rights and interests of Alberto when she paid for resold to respondents-spouses by the co-owners. Petitioners Rito
Alberto's share as well as his obligation to Dr. Corrompido; and (3) and Nelson were then minors and as indicated in the Deed of Sale,
petitioner Rito had no more right to redeem his share to subject their shares in the proceeds were held in trust by respondents-
property as the sale by Saturnina, his legal guardian pursuant to spouses to be paid and delivered to them upon reaching the age
Section 7, Rule 93 of the Rules of Court, was perfectly valid; and of majority.
it was shown that he received his share of the proceeds of the sale As to petitioner Rito, the contract of sale was unenforceable as
on July 24, 1986, when he was 24 years old. HcTEaA correctly held by the Court of Appeals. Articles 320 and 326 of the
On appeal, the Court of Appeals modified the decision of the trial New Civil Code 6 state that:
court. It held that the sale by Saturnina of petitioner Rito's Art. 320. The father, or in his absence the mother, is the legal
undivided share to the property was unenforceable for lack of administrator of the property pertaining to the child under parental
authority or legal representation but that the contract was authority. If the property is worth more than two thousand pesos,
effectively ratified by petitioner Rito's receipt of the proceeds on the father or mother shall give a bond subject to the approval of
July 24, 1986. The appellate court also ruled that petitioner Nelson the Court of First Instance.
is co-owner to the extent of one-seventh (1/7) of subject property Art. 326. When the property of the child is worth more than two
as Saturnina was not subrogated to Alberto's rights when she thousand pesos, the father or mother shall be considered a
repurchased his share to the property. It further directed petitioner guardian of the child's property, subject to the duties and
Nelson to pay the estate of the late Saturnina Cabales the amount obligations of guardians under the Rules of Court.
of P966.66, representing the amount which the latter paid for the
obligation of petitioner Nelson's late father Alberto. Finally, In other words, the father, or, in his absence, the mother, is
however, it denied petitioner Nelson's claim for redemption for his considered legal administrator of the property pertaining to the
failure to tender or consign in court the redemption money within child under his or her parental authority without need of giving a
the period prescribed by law. bond in case the amount of the property of the child does not
In this petition for review on certiorari, petitioners contend that the exceed two thousand pesos. 7 Corollary to this, Rule 93, Section
Court of Appeals erred in (1) recognizing petitioner Nelson 7 of the Revised Rules of Court of 1964, applicable to this case,
Cabales as co-owners of subject land but denied him the right of automatically designates the parent as legal guardian of the child
legal redemption, and (2) not recognizing petitioner Rito Cabales without need of any judicial appointment in case the latter's
as co-owner of subject land with similar right of legal redemption. property does not exceed two thousand pesos, 8 thus:
First, we shall delineate the rights of petitioners to subject land. Sec. 7. Parents as guardians. When the property of the child
When Rufino Cabales died intestate, his wife Saturnina and his six under parental authority is worth two thousand pesos or less, the
(6) children, Bonifacio, Albino, Francisco, Leonora, Alberto and father or the mother, without the necessity of court appointment,
petitioner Rito, survived and succeeded him. Article 996 of the shall be his legal guardian . . . 9
New Civil Code provides that "[i]f a widow or widower and Saturnina was clearly petitioner Rito's legal guardian without
legitimate children or descendants are left, the surviving spouse necessity of court appointment considering that the amount of his
has in the succession the same share as that of each of the property or one-seventh of subject property was P1,143.00, which
children." Verily, the seven (7) heirs inherited equally on subject is less than two thousand pesos. However, Rule 96, Sec.
property. Petitioner Rito and Alberto, petitioner Nelson's father, 1 10 provides that:
inherited in their own rights and with equal shares as the others. Section 1. To what guardianship shall extend. A guardian
But before partition of subject land was effected, Alberto died. By appointed shall have the care and custody of the person of his
operation of law, his rights and obligations to one-seventh of ward, and the management of his estate, or the management of
subject land were transferred to his legal heirs his wife and his the estate only, as the case may be. The guardian of the estate of
son petitioner Nelson. a nonresident shall have the management of all the estate of the
We shall now discuss the effects of the two (2) sales of subject ward within the Philippines, and no court other than that in which
land to the rights of the parties. such guardian was appointed shall have jurisdiction over the
The first sale with pacto de retro to Dr. Corrompido by the brothers guardianship.
and co-owners Bonifacio, Albino and Alberto was valid but only as Indeed, the legal guardian only has the plenary power of
to their pro-indiviso shares to the land. When Alberto died prior to administration of the minor's property. It does not include the
repurchasing his share, his rights and obligations were transferred power of alienation which needs judicial authority. 11 Thus, when
to and assumed by his heirs, namely his wife and his son, Saturnina, as legal guardian of petitioner Rito, sold the latter's pro-
petitioner Nelson. But the records show that it was Saturnina, indiviso share in subject land, she did not have the legal authority
Alberto's mother, and not his heirs, who repurchased for him. As to do so.
correctly ruled by the Court of Appeals, Saturnina was not Article 1403 of the New Civil Code provides, thus:
subrogated to Alberto's or his heirs' rights to the property when she Art. 1403. The following contracts are unenforceable, unless they
repurchased the share. are ratified:
In Paulmitan v. Court of Appeals, 3 we held that a co-owner who (1) Those entered into in the name of another person by one who
redeemed the property in its entirety did not make her the owner has been given no authority or legal representation, or who has
of all of it. The property remained in a condition of co-ownership acted beyond his powers;
as the redemption did not provide for a mode of terminating a co- xxx xxx xxx
ownership. 4 But the one who redeemed had the right to be Accordingly, the contract of sale as to the pro-indiviso share of
reimbursed for the redemption price and until reimbursed, holds a petitioner Rito was unenforceable. However, when he
lien upon the subject property for the amount due. 5 Necessarily, acknowledged receipt of the proceeds of the sale on July 24, 1986,
when Saturnina redeemed for Alberto's heirs who had then petitioner Rito effectively ratified it. This act of ratification rendered
acquired his pro-indivisoshare in subject property, it did not vest in the sale valid and binding as to him. aDIHCT
her ownership over the pro-indiviso share she redeemed. But she With respect to petitioner Nelson, on the other hand, the contract
had the right to be reimbursed for the redemption price and held a of sale was void. He was a minor at the time of the sale. Saturnina
lien upon the property for the amount due until reimbursement. or any and all the other co-owners were not his legal guardians
The result is that the heirs of Alberto, i.e., his wife and his son with judicial authority to alienate or encumber his property. It was
his mother who was his legal guardian and, if duly authorized by a barangay conciliation process. But he only filed the complaint for
the courts, could validly sell his undivided share to the property. legal redemption and damages on January 12, 1995, certainly
She did not. Necessarily, when Saturnina and the others sold the more than thirty days from learning about the sale.
subject property in its entirety to respondents-spouses, they only In the face of the established facts, petitioner Nelson cannot feign
sold and transferred title to their pro-indiviso shares and not that ignorance of the sale of subject property in 1978. To require strict
part which pertained to petitioner Nelson and his mother. proof of written notice of the sale would be to countenance an
Consequently, petitioner Nelson and his mother retained obvious false claim of lack of knowledge thereof, thus
ownership over their undivided share of subject property. 12 commending the letter of the law over its purpose, i.e., the
But may petitioners redeem the subject land from respondents- notification of redemptioners.
spouses? Articles 1088 and 1623 of the New Civil Code are The Court is satisfied that there was sufficient notice of the sale to
pertinent: petitioner Nelson. The thirty-day redemption period commenced in
Art. 1088. Should any of the heirs sell his hereditary rights to a 1993, after petitioner Nelson sought the barangay conciliation
stranger before the partition, any or all of the co-heirs may be process to redeem his property. By January 12, 1995, when
subrogated to the rights of the purchaser by reimbursing him for petitioner Nelson filed a complaint for legal redemption and
the price of the sale, provided they do so within the period of one damages, it is clear that the thirty-day period had already expired.
month from the time they were notified in writing of the sale by the As in Alonzo, the Court, after due consideration of the facts of the
vendor. instant case, hereby interprets the law in a way that will render
Art. 1623. The right of legal pre-emption or redemption shall not justice. 15
be exercised except within thirty days from the notice in writing by Petitioner Nelson, as correctly held by the Court of Appeals, can
the prospective vendor, or by the vendor, as the case may be. The no longer redeem subject property. But he and his mother remain
deed of sale shall not be recorded in the Registry of Property, co-owners thereof with respondents-spouses. Accordingly, title to
unless accompanied by an affidavit of the vendor that he has given subject property must include them.
written notice thereof to all possible redemptioners. IN VIEW WHEREOF, the petition is DENIED. The assailed
The right of redemption of co-owners excludes that of adjoining decision and resolution of the Court of Appeals of October 27,
owners. 2003 and February 23, 2004 are AFFIRMED WITH
Clearly, legal redemption may only be exercised by the co-owner MODIFICATION. The Register of Deeds of Southern Leyte is
or co-owners who did not part with his or their pro-indiviso share ORDERED to cancel Original Certificate of Title No. 17035 and to
in the property held in common. As demonstrated, the sale as to issue in lieu thereof a new certificate of title in the name of
the undivided share of petitioner Rito became valid and binding respondents-spouses Jesus and Anunciacion Feliano for the 6/7
upon his ratification on July 24, 1986. As a result, he lost his right portion, and petitioner Nelson Cabales and his mother for the
to redeem subject property. SEHTAC remaining 1/7 portion, pro indiviso.
However, as likewise established, the sale as to the undivided SO ORDERED.
share of petitioner Nelson and his mother was not valid such that ||| (Cabales v. Court of Appeals, G.R. No. 162421, [August 31,
they were not divested of their ownership thereto. Necessarily, 2007], 558 PHIL 450-465)
they may redeem the subject property from respondents-spouses.
But they must do so within thirty days from notice in writing of the TAGHOY v. TIGOL
sale by their co-owners vendors. In reckoning this period, we held THIRD DIVISION
in Alonzo v. Intermediate Appellate Court, 13 thus: [G.R. No. 159665. August 3, 2010.]
. . . we test a law by its results; and likewise, we may add, by its 9:48 A.M.
purposes. It is a cardinal rule that, in seeking the meaning of the ANSELMO TAGHOY and the late VICENTA T. APA,
law, the first concern of the judge should be to discover in its substituted by her heirs, namely, MANUEL T. APA, NICASIO
provisions the intent of the lawmaker. Unquestionably, the law T. APA, DELFIN T. APA, ALMA A. JACALAN, ARLENE A.
should never be interpreted in such a way as to cause injustice as SUMALINOG, AIDA A. ARONG, ELENA A. COSEP, ALFREDO
this is never within the legislative intent. An indispensable part of T. APA, ISABELO T. APA, JR., ISABELO T. APA III, SHERWIN
that intent, in fact, for we presume the good motives of the T. APA, and FLORITO T. APA, petitioners, vs. SPS.
legislature, is to render justice. FELIXBERTO TIGOL, JR. and ROSITA TIGOL, respondents.
Thus, we interpret and apply the law not independently of but in DECISION
consonance with justice. Law and justice are inseparable, and we BRION, J p:
must keep them so. . . . We resolve the present petition for review on certiorari 1 filed by
. . . While we may not read into the law a purpose that is not there, petitioners Anselmo Taghoy and the heirs of Vicenta T.
we nevertheless have the right to read out of it the reason for its Apa (petitioners) to challenge the decision 2 and the
enactment. In doing so, we defer not to "the letter that killeth" but resolution 3 of the Court of Appeals (CA) in CA-G.R. CV No.
to "the spirit that vivifieth," to give effect to the lawmaker's will. 54385. 4 The CA decision set aside the decision 5 of the Regional
In requiring written notice, Article 1088 (and Article 1623 for that Trial Court (RTC), Branch 27, Lapu-lapu City in Civil Case No.
matter) 14 seeks to ensure that the redemptioner is properly 2247. The CA resolution denied the petitioners' subsequent
notified of the sale and to indicate the date of such notice as the motion for reconsideration. EICDSA
starting time of the 30-day period of redemption. Considering the FACTUAL BACKGROUND
shortness of the period, it is really necessary, as a general rule, to The facts of the case, gathered from the records, are briefly
pinpoint the precise date it is supposed to begin, to obviate the summarized below.
problem of alleged delays, sometimes consisting of only a day or Spouses Filomeno Taghoy and Margarita Amit 6 owned an 11,067
two. square meter parcel of land, known as Lot 3635-B of subdivision
In the instant case, the right of redemption was invoked not days plan (LRC) Psd-212881 (subject property), located in Barrio Agus,
but years after the sale was made in 1978. We are not unmindful Lapu-Lapu City, Cebu under Transfer Certificate of Title (TCT) No.
of the fact that petitioner Nelson was a minor when the sale was 6466 of the Lapu-Lapu City Registry of Deeds. 7
perfected. Nevertheless, the records show that in 1988, petitioner On August 6, 1975, Filomeno and Margarita 8 executed a special
Nelson, then of majority age, was informed of the sale of subject power of attorney, appointing Felixberto Tigol, Jr. as their attorney-
property. Moreover, it was noted by the appellate court that in-fact. 9 On August 21, 1975, Felixberto, as attorney-in-fact,
petitioner Nelson was likewise informed thereof in 1993 and he executed a real estate mortgage over the subject property to
signified his intention to redeem subject property during secure a loan of P22,000.00 with the Philippine National
Bank (PNB). 10 Filomeno and Margarita obtained the loan to After the CA denied 24 the motion for reconsideration 25 that
finance the shellcraft business of their children. 11 followed, the petitioners filed the present petition.
Filomeno died intestate on February 12, 1976. On July 27, 1979, THE PETITION
his widow, Margarita, and their seven children, namely, Vicenta, The petitioners argue that the heirs, in executing the extrajudicial
Felisa, Pantaleon, Gaudencio, Anselmo, Anastacia and Rosita, as settlement, did not intend to divest themselves of their respective
heirs of the deceased, executed a Deed of Extrajudicial Settlement rightful shares, interests and participation in the subject property
and Sale, adjudicating to themselves the subject property and because it lacked a consideration, as affirmed by the respondents'
selling the same to Rosita and her husband own joint affidavits; the payment of the PNB loan could not be a
Felixberto (respondents) for P1,000.00. 12 valid consideration for the transfer since the loan was still unpaid
Subsequently, on September 7, 1981 and August 10, 1982, and outstanding at the time of the execution of the extrajudicial
Filomeno's heirs executed two (2) Deeds of Confirmation of Sale, settlement. 26
confirming the supposed sale of the subject property by Filomeno THE CASE FOR THE RESPONDENTS
and Margarita in favor of the respondents for The respondents, on the other hand, maintain that the Extrajudicial
P1,000.00. 13 Simultaneous with the execution of the deeds, Settlement and Sale was the basis of their registration of title, and
however, the respondents executed explanatory Joint Affidavits their payment of the PNB loan was the real consideration for the
attesting that the sale was without any consideration, and was only transfer; the joint affidavits were executed only out of generosity
executed to secure a loan. 14 and kindness, subject to the heirs' reimbursement of the amounts
On March 9, 1983, TCT No. 13250 was issued in the respondents' they paid for the loan, such that when the heirs did not reimburse
names. 15 On July 1, 1983, the respondents obtained a the amounts paid, they then caused the registration of title in their
P70,000.00 loan with the Philippine Banking Corporation, secured names. 27
by a real estate mortgage on the subject property. 16 AEDcIH THE ISSUE
Seven (7) years later, on April 17, 1990, Anselmo and Vicenta, The core issue boils down to whether the sale of the subject
together with Margarita, Felisa, Gaudencio, and Pantaleon's property between the parties was absolutely or relatively
surviving heir, Annabel, filed a complaint against the respondents simulated.
and Anastacia for declaration of nullity of the respondents' TCT OUR RULING
and for judicial partition. 17 They alleged that the deeds of We find the petition meritorious.
confirmation of sale became the bases for the transfer of the title This Court is not a trier of facts. However, if the inference drawn
in the respondents' names, but the sale was fictitious or simulated, by the appellate court from the facts is manifestly mistaken, as in
as evidenced by the respondents' own explanatory joint affidavits the present case, we can review the evidence to allow us to arrive
attesting that the transfer was for the purpose only of convenience at the correct factual conclusions based on the record. 28 IHCacT
in securing a loan, not for absolute conveyance or sale. In the interpretation of contracts, the intention of the parties is
The respondents admitted that they executed the joint affidavits accorded primordial consideration; 29 such intention is
but countered that they acquired a valid title to the subject property determined from the express terms of their agreement, 30 as well
through the Extrajudicial Settlement of Heirs and Sale. They as their contemporaneous and subsequent acts. 31 When the
claimed that when Filomeno died without the PNB loan being paid, parties do not intend to be bound at all, the contract is absolutely
the heirs agreed that the respondents will advance payment of the simulated; if the parties conceal their true agreement, then the
loan, subject to reimbursement, to save the foreclosure of the contract is relatively simulated. 32 An absolutely simulated
subject property; the heirs then executed the Extrajudicial contract is void, and the parties may recover from each other what
Settlement and Sale in the respondents' favor as their way of they may have given under the simulated contract, while a
reimbursing the amount the latter paid; the respondents executed relatively simulated contract is valid and enforceable as the parties'
the joint affidavits out of generosity, expressing their willingness to real agreement binds them. 33 Characteristic of simulation is that
be reimbursed, but when the heirs failed to reimburse the amounts the apparent contract is not really desired or intended to produce
advanced by them, then they caused the registration of the title in legal effects, or in any way, alter the juridical situation of the
their names. 18 parties. 34
Margarita, Felisa, Gaudencio and Annabel failed to appear at the In the present case, the parties never intended to be bound by their
initial hearing, prompting the petitioners' counsel to manifest that, agreement as revealed by the two (2) joint affidavits executed by
except for Anselmo and Vicenta, they were abandoning the the respondents simultaneous with the execution of the deeds of
complaint. 19 The petitioners subsequently amended the confirmation of sale. The September 7, 1981 Joint Affidavit stated:
complaint to implead Margarita, Felisa, Gaudencio and Annabel 2. That the truth of the matter is that the deed of sale and the
as party defendants or unwilling plaintiffs. 20 confirmation of said sale by the legal heirs are executed for the
THE RTC RULING purpose of securing a loan in our name but which amount of said
In its decision, the RTC found that the sale of the subject property loan shall be divided equally among the legal heirs, and that every
was absolutely simulated since the deeds of confirmation of sale heir shall pay his corresponding share in the amortization payment
were executed only to accommodate the respondents' loan of said loan;
application using the subject property as collateral. The lower court 3. That said sale was without any consideration, and that we
thus ordered the nullification of the respondents' title. It likewise executed this affidavit to establish the aforestated facts for
ordered the partition of the subject property after reimbursement purposes of loan only but not for conveyance and transfer in our
of the amount the respondents paid for the loan. 21 name absolutely and forever but during the duration of the
Subsequently, the respondents filed a motion for new trial, terms of the loan;
anchored on newly discovered evidence allegedly proving that the 4. That we executed this affidavit voluntarily and freely in order to
subject property is Margarita's paraphernal property. 22 When the establish this facts (sic) above-mentioned and to undertake to
RTC denied 23 the motion for new trial, the respondents filed an return the said land to the legal heirs of the late spouse,
appeal with the CA, under Rule 41 of the Rules of Court. DHEACI Filomeno Taghoy, survived by his widow, Rita Amit-Taghoy, upon
THE CA RULING full payment of our intended loan. 35
The CA decided the appeal on August 26, 2002, reversing the The August 10, 1982 Joint Affidavit, on the other hand, averred:
RTC decision. Relying upon Margarita's testimony that the 3. That the truth of the matter is that said Lot No. 3635-B was sold
respondents paid the loan, the CA found that the contract between without any purchase price or consideration paid to said
the parties was relatively simulated; the respondents' payment of Filomeno Taghoy, but for the purpose of securing a loan in our
the PNB loan was the real consideration for the transfer of title.
name but which amount of said loan shall be divided equally Factual Antecedents
among us, the legal heirs of Filomeno Taghoy; DAaIEc On September 2, 1976, respondent Beata Sayson (Beata) and her
4. That in case the loan will be fully paid, we shall obligate husband Roberto Sayson, Sr. (Roberto, Sr.) filed a Petition for
ourselves to resell, reconvey the said Lot No. 3635-B in favor of Registration of an agricultural land located in Cagbatang,
the Heirs of Filomeno Taghoy and Rita Amit, and in case, the said Balagtas, Matag-ob, Leyte docketed as Land Registration Case
loan will not be post (sic) through. No. 0-177. The said application was opposed by the Republic of
5. That we executed this affidavit voluntarily and freely in order to the Philippines and herein petitioners Eugenio Basbas (Eugenio,
establish the aforestated facts and to attest the fact that said deed Sr.), Teofilo Aras (Teofilo) and Rufino Aras (Rufino). On March 22,
of confirmation of sale is only for purposes of convenience in 1979, the Court of First Instance (CFI) of Leyte, Branch V (Ormoc
securing the loan and not for absolute conveyance or sale. 36 City) rendered a Decision adjudicating to the spouses Sayson said
The joint affidavits are very solid pieces of evidence in the agricultural land and approving its registration under their
petitioners' favor. They constitute admissions against interest names. 4 cADaIH
made by the respondents under oath. An admission against The oppositors filed their appeal to the CA docketed as CA-G.R.
interest is the best evidence that affords the greatest certainty of No. 66541. In a Decision 5 dated July 24, 1985, the appellate court
the facts in dispute, 37 based on the presumption that no man affirmed in toto the Decision of the CFI. This CA Decision became
would declare anything against himself unless such declaration is final and executory on August 21, 1985 6 and, accordingly, a Writ
true. 38 It is fair to presume that the declaration corresponds with of Possession was issued on November 21, 1985, which was
the truth, and it is his fault if it does not. 39 never implemented.
Thus, by the respondents' own admissions, they never intended to The following year or on September 17, 1986, Original Certificate
be bound by the sale; they merely executed the documents for of Title (OCT) No. 2496 7 was issued to the
convenience in securing a bank loan, and they agreed to reconvey spouses Sayson pursuant to the March 22, 1979 CFI Decision. An
the subject property upon payment of the loan. The sale was Alias Writ of Possession was issued on April 6, 1989 but this could
absolutely simulated and, therefore, void. also not be implemented in view of the refusal of Eugenio, Sr. and
We find that the CA misappreciated Margarita's testimony that the his son Eugenio Basbas, Jr. (Eugenio, Jr.). Claiming that the land
respondents are entitled to the entire property because they they occupied is not the same land subject of the CFI
redeemed or paid the bank loan. 40 The failure of the other heirs Decision, 8 they demanded that a relocation survey be conducted.
to reimburse the amounts advanced by the respondents in Hence, a relocation survey was conducted by order of the
payment of the loan did not entitle the latter to claim full ownership Regional Trial Court (RTC), Branch 12, Ormoc City. 9
of the co-owned property. 41 It only gave them the right to claim In an Order 10 dated September 13, 1989, the RTC approved the
reimbursement for the amounts they advanced in behalf of the co- Commissioner's Report 11 on the relocation survey and ordered
ownership. The respondents' advance payments are in the nature the original oppositors, petitioners Eugenio, Sr., Teofilo and
of necessary expenses for the preservation of the co-ownership. Rufino, as well as their co-petitioners herein
Article 488 of the Civil Code provides that necessary expenses Gervacio Basbas (Gervacio), Ismael Aras (Ismael), Eugenio Aras
may be incurred by one co-owner, subject to his right to collect (Eugenio), Simfronio Aras (Simfronio), Feliciano Aras (Feliciano),
reimbursement from the remaining co-owners. 42 Until Rosita Aras (Rosita) and Eugenio, Jr. to vacate the subject
reimbursed, the respondents hold a lien upon the subject property property, viz.:
for the amount they advanced. cSDHEC [R]espondents are directed to vacate the portion of Lot No. 1, Psu-
Based on the foregoing, we find that the CA erred in setting aside 08-000235 covered by OCT No. 2496 and subject of the final
the decision of the RTC and in dismissing the petitioners' decree of registration which, [up to the] present, said respondents
complaint against the respondents. are still possessing pursuant to the final and executory judgment
WHEREFORE, we hereby REVERSE and SET ASIDE the of the Court of Appeals and as particularly defined in the
decision dated August 26, 2002 and the resolution dated July 22, Commissioner's report submitted on August 3, 1989 . . . .
2003 of the Court of Appeals in CA-G.R. CV No. 54385. The Respondents are reminded that under Rule 71 of the New Rules
decision dated February 23, 1994 of the Regional Trial Court, of Court, failure on their part to so obey this order may make them
Branch 27, Lapu-Lapu City in Civil Case No. 2247 liable for contempt of this Court.
is REINSTATED. No pronouncement as to costs. SO ORDERED. 12
SO ORDERED. Gervacio, Ismael, Eugenio, Simfronio, Feliciano, Rosita and
||| (Taghoy v. Spouses Tigol, Jr., G.R. No. 159665, [August 3, Eugenio, Jr., although not oppositors in CA-G.R. No. 66541, were
2010], 640 PHIL 385-396) likewise ordered to vacate the property in view of the following
pronouncement in the RTC's September 13, 1989 Order:
BASBAS v. SAYSON It appearing from the records that respondents Eugenio Basbas,
FIRST DIVISION Teofilo Aras, Gervacio Basbas, Rufino Aras, Ismael Aras,
[G.R. No. 172660. August 24, 2011.] Eugenio Aras, Simfronio Aras, Feliciano Aras, Rosita Aras
EUGENIO BASBAS, TEOFILO ARAS, RUFINO ARAS, and Eugenio Basbas[,] Jr. are parties to the present case,
GERVACIO BASBAS, ISMAEL ARAS, EUGENIO ARAS, they having been the principal oppositors to the petition filed
SIMFRONIO ARAS, FELICIANO ARAS, ROSITA ARAS, by the applicants as shown in the records, pages 34, 35 and
EUGENIO BASBAS, JR. and SPOUSES PABLITO BASARTE 36, Vol. 1 . . . 13 (Emphasis supplied.)
and MARCELINA BASBAS BASARTE, petitioners, vs. This September 13, 1989 Order was, however, not implemented
BEATA SAYSON and ROBERTO SAYSON, JR.,respondents. within the five-year period from the time it became final. 14 Hence,
DECISION respondent Beata and her son Roberto Sayson, Jr. (Roberto, Jr.),
DEL CASTILLO, J p: as successor-in-interest of the late Roberto, Sr., filed on August
Petitioners seek to prevent the revival of a judgment rendered in 18, 1995 a Complaint for Revival of Judgment 15 before the RTC
favor of the respondents more than two decades back. of Ormoc City, Branch 12, 16 docketed as Civil Case No. 3312-0.
This Petition for Review on Certiorari assails the February 17, Impleaded as defendants were Eugenio, Sr., Teofilo, Rufino,
2004 Decision 1 of the Court of Appeals (CA) in CA-G.R. CV No. Gervacio, Ismael, Eugenio, Simfronio, Feliciano, Rosita, and
72385 which denied the appeal filed before it and affirmed in Eugenio, Jr. Petitioner-spouses Pablito Basarte and
toto the May 21, 2001 Order 2 of the Regional Trial Court of Marcelina Basbas-Sabarte 17 (spouses Basarte), who, although
Ormoc City, Branch 35. Also assailed is the April 19, 2006 not identified in the September 13, 1989 Order as principal
Resolution 3 denying the Motion for Reconsideration thereto. oppositors in the land registration case, were likewise impleaded
as defendants since they also allegedly harvested, processed, and points are existing and intact on the field except . . . corner 3 of
sold the coconuts found in the subject property. said lot . . . which at present [is] already defined and indicated on
Upon receipt of summons, Gervacio, Rufino, Ismael, Eugenio, the ground.' The commissioner also attached a Sketch Plan of the
Feliciano, Rosita and Eugenio, Jr. filed a Motion to Dismiss 18 on land to his report. . . .
the ground that the Complaint states no cause of action. This was, 12. That, finally, the Honorable Court, on September 13, 1989
however, denied 19 so the same set of petitioners, except for issued an Order approving the Commissioner's Report and further
Feliciano, filed an Answer with Counterclaim. 20 stated:
In their Answer with counterclaim, said petitioners admitted the [R]espondents (defendants herein) are directed to vacate the
allegations in paragraphs 4, 5, 6, 7, 8, 9, 10, 11 and 12 of portion of Lot No. 1, Psu-08-000235 covered by OCT No. 2496
respondents' Complaint which state that: DIcSHE and subject of final decree of registration which, until [the] present,
xxx xxx xxx said respondents are still possessing, pursuant to the final and
4. On March 22, 1979, the Honorable Judge Numeriano Estenzo executory judgment of the Court of Appeals and as particularly
rendered a decision in the above-mentioned Land Registration [defined] in the Commissioner's Report submitted on August 3,
[c]ase in favor of the petitioners . . . and against the oppositors, the 1989 . . .
dispositive portion of said decision reads: Respondents are reminded that under Rule 71 of the New Rules
'WHEREFORE, decision is hereby rendered . . . [and] the land of Court, failure on their part to so obey this Order may make them
described under Plan PSU-08-000235 dated September 10, 1973 liable for contempt of this Court. 21
of Geodetic Engineer Nestorio Encenzo already APPROVED by However, petitioners admitted but denied in part:
the Acting Regional Director on June 27, 1974 is hereby 1) paragraphs 2 and 3, insofar as they alleged that they were all
adjudicated and registered in the names of the Spouses oppositors to the land registration case when only Eugenio, Sr.,
ROBERTO SAYSON and BEATA O. SAYSON, of legal ages, Teofilo and Rufino were the oppositors therein; and
Filipinos, spouses and residents of Campokpok, Tabango, Leyte, 2) paragraph 14, with respect to the allegation on the retirement of
Philippines and as soon as this decision becomes final, let a the Deputy Sheriff and the heart condition of the Clerk of Court, for
decree of registration be issued by the Land Registration lack of sufficient knowledge and information sufficient to form a
Commission. belief thereon.
SO ORDERED.' (. . .) On the other hand, they specifically denied:
5. From the above decision the oppositors (defendants herein) 1) paragraph 13, on the ground that they have the right of
appealed; ownership and/or possession over the subject property; and
6. On July 24, 1985, the Honorable Court of Appeals rendered its 2) paragraph 15, on the ground that the property they are
decision, the dispositive portion [of which] reads: cultivating is owned by them, hence, respondents cannot suffer
'WHEREFORE, PREMISES CONSIDERED, finding no merit in losses and damages.
this appeal the decision appealed from is hereby AFFIRMED in Paragraphs 2, 3, 13, 14 and 15 alluded to in the foregoing are as
toto. follows:
SO ORDERED.' 2. All the defendants named above are . . . of legal age and are
and the said decision has become final and executory on August residents of Balagtas, Matag-ob, Leyte where they may be served
21, 1985 per Entry of Judgment issued by the Court of Appeals . . summons and other court processes; while defendant-spouses
.. Pablito Basarte and Marcelina Basbas Basarte were not named
7. That consequently, on September 17, 1986 an Original as among the oppositors in the land registration case whose
Certificate of Title No. N-2496 was issued in the names of decision is herein sought to be revived, said spouses are
Roberto Sayson and Beata O. Sayson, pursuant to Decree No. N- nonetheless participating in the harvest, processing and sale of
191615, by the Register of Deeds for the Province of Leyte; the coconuts with the other defendants named above; HTCaAD
8. That on motion, the Honorable Court, on November 21, 1985, 3. Plaintiffs Beata Sayson and her late husband,
issued a Writ of Possession which for some reason or [another] Roberto Sayson are petitioners in Land Registration Case No. 0-
was not satisfied, so that the Honorable Court, on April 7, 1989 177 for the registration of a parcel of agricultural land situated in
acting on an ex-parte motion dated April 6, 1989 directed the Barrio Balagtas, Matag-ob, Leyte, filed on September 2, 1976 with
issuance of an Alias Writ of Possession; the then Court of First Instance of Leyte, Branch V, Ormoc City.
9. That the Deputy Sheriff of this Court, Mr. Placid[o] Cayco The above-named defendants, namely: Eugenio Basbas, Teofilo
tendered the Alias Writ of Possession to the oppositors, Aras, Gervacio Basbas, Rufino Aras, Ismael Aras, Eugenio Aras,
particularly to Mr. Eugenio Basbas, Sr. and Eugenio Basbas, Jr. Simfronio Aras, Feliciano Aras, Rosita Aras and Eugenio Basbas,
who, as the Deputy Sheriff stated in his Progress Report dated Jr. were oppositors to the application; 22
May 18, 1989 'did not believe and obey the CFI Decision and the xxx xxx xxx
decision of the Court of Appeals' and '. . . [t]hey demanded a 13. That despite this admonition in the [September 13, 1989]
relocation survey to determine the exact location of applicants' [O]rder that they could be cited for contempt of Court, the
(complainant[s] herein) property described in the alias writ of respondents, defendants herein, had continuously defied the
possession.' . . .; same and this notwithstanding the fact that it was upon their own
10. That on June 16, 1989, the Honorable Court, acting on the demands and insistence that a relocation survey be made on the
Progress Report of Deputy Sheriff Placido Cayco, issued an Order premises subject of this case before they would obey the alias writ
on even date appointing Geodetic Engineer Jose A. Tahil as Court of possession . . . and that the finding[s] of the Court[-]appointed
Commissioner specifically 'to relocate Lot No. 1, Plan Psu-08- Commissioner Engr. Jose A. Tahil show that the oppositors-
000235, LRC No. 0-177, Land Reg. Record No. N51830 . . .' This respondents did [encroach] on the land of plaintiffs herein;
Order was dictated in open court in the presence of Mr. 14. That this [September 13, 1989] Order however was not
Eugenio Basbas, Sr. and Eugenio Basbas, Jr. who had both implemented thru a Writ of Execution within the five-year period
objected to the Writ of Possession, and their counsel Atty. from the time the Order became final because of the retirement of
Evargisto Escalon, and Attorney Demetrio D. Sarit, counsel for the Deputy Sheriff Placido Cayco and by reason also of the fact that
applicants. . . . the then Clerk of Court, Atty. Constantino A. Trias, Jr. who was
11. That pursuant to the [O]rder dated June 16, 1989 . . . the Court also the ex-officio Provincial Sheriff was not physically fit to hike
assigned Commissioner, Engr. Jose A. Tahil, submitted his report thru the mountains and hills of Brgy. Balagtas where the property
stating that 'the job assigned to the commissioner was already fully and the defendants therein reside due to his heart condition;
and peacefully accomplished; that his 'findings [show] that all
15. That despite their knowledge of the Court['s] [September 13, Plaintiffs therefore are given a period of ten (10) days from today
1989] Order, the same [having been] dictated in open court, the within which to submit the requisite manifestation furnishing copy
respondents had continued to occupy the land of the plaintiffs and thereof to the defendant who upon receipt shall also be given a
for more than five (5) years since this Order for them to vacate the period of ten (10) days within which this Court will make the
land in question was issued, they had harvested the coconuts necessary resolution before allowing any amendment.
growing thereon and such other produce of the land herein Hold the pre-trial conference in abeyance.
involved. And until the decision of the Court of Appeals is SO ORDERED. 31 (Emphasis supplied.)
executed, plaintiff will continue to suffer losses and damages by In their Manifestation with Prayer, 32 respondents informed the
reason of defendants' unlawful occupation and possession and RTC about the death of Eugenio, Sr. and Teofilo who were
their continued harvesting of the produce of this land of the herein oppositors in the land registration case and the substitution by their
plaintiffs. 23 heirs, namely, Gervacio, Marcelina Basbas Basarte, 33 and
By way of special and affirmative defenses, said petitioners Eugenio, Jr. for Eugenio, Sr. and Ismael, Vicente, Ligaya Aras
contended that the Order sought to be revived is not the (Ligaya), Rosendo Aras (Rosendo) and Daina Aras (Daina) for
"judgment" contemplated under Section 6, Rule 39 of the Rules of Teofilo. Respondents prayed that their manifestation be
Court, hence the action for revival of judgment is improper. Also, considered for the purpose of determining the proper parties to the
except for Rufino, petitioners averred that they cannot be made case. Despite petitioners' Counter-Manifestation, 34 the RTC
parties to the complaint for revival of judgment as they were not issued the following Order 35 on May 15, 1999:
parties to the land registration case. They thus believed that the The Manifestation of plaintiffs and the Counter-Manifestation of
September 13, 1989 Order sought to be revived is not binding defendants having already been submitted and duly noted, the
upon them and hence, the complaint states no cause of action with Court hereby directs that henceforth in the denomination of this
respect to them. As to the counterclaim, petitioners prayed that case, the names of the original parties, Eugenio Basbas and
respondents pay them moral and exemplary damages, attorney's Teofilo Aras (in Land Registration Case No. 0-177) shall still
fees and litigation expenses. remain to be so stated as defendants for purposes of the present
Pre-trial conference was thereafter set 24 but since not all case but with additional names of their respective heirs to be
petitioners were served with summons, this was reset and alias included and stated immediately after each name as heirs in
summons was issued and served upon Simfronio and the spouses substitution, namely: for Eugenio Basbas 1) Gervacio Basbas,
Basarte. 25 Upon receipt of summons, Simfronio adopted the 2) Marcelina Basbas Basarte, and 3) Eugenio Basbas, Jr.; and for
Answer with Counterclaim of Gervacio, Rufino, Ismael, Eugenio, Teofilo Aras 1) Ismael Aras, 2) Vicente Aras, 3) Ligaya Aras, 4)
Feliciano, Rosita and Eugenio, Jr. 26while the spouses Basarte Rosendo Aras, and 5) Daina Aras.
filed a Motion to Dismiss 27 on the ground of lack of cause of Since from the records, only Gervacio Basbas, Eugenio Basbas,
action. As said motion was also denied, 28 the spouses Basarte Jr. and Ismael Aras were duly served with summons, the Branch
later filed a Manifestation 29 that they were also adopting the Clerk of Court is hereby directed to serve summons on the other
Answer with Counterclaim filed by Gervacio and the others. heirs, namely: Marcelina Basbas Basarte, Vicente Aras, Ligaya
During the pre-trial conference on July 14, 1999, the RTC issued Aras, Rosendo Aras, and Daina Aras.
an Order 30 which provides in part, viz.: xxx xxx xxx 36
In today's pre-trial conference, manifestations and counter- After summons were served, Vicente, Rosendo, Ligaya and Daina
manifestations were exchanged. All the parties and their counsels were, however, declared in default for not filing any responsive
are present. . . . [P]laintiffs' counsel presented a Special Power pleading. 37 On February 2, 2001, the RTC issued a Pre-Trial
of Attorney by Beata Sayson but the Court observed that Order 38 where the controverted stipulations and issues to be
same was not duly acknowledged before the Philippine tried, among others, were enumerated as follows:
Consulate or Embassy in Canada. However, this matter is not Controverted Stipulations:
so important[.] [W]hen the Court tried to dig and discuss with the 1. That defendants are not enjoying the produce of the land
parties on their real positions, it turned out that the plaintiffs are because there are period[s] wherein the fruits were subject of theft
seeking revival of the previous final judgment, the original and the same is now pending at the Municipal Trial Court of Matag-
parties of which were Eugenio Basbas, Teofilo Aras and ob;
Rufino Aras. Eugenio and Teofilo are all dead, leaving Rufino 2. That [even] before the start of the original case, the original
Aras alive. It is quite complicated considering that in this defendants referring to the late Eugenio Basbas, Sr. and Teofilo
action, the plaintiffs relied on the Order of this Court penned Aras, [and] Rufino Aras were occupying the property and they
by the previous judge dated September 13, 1989 which was were succeeded by the respective heirs of the deceased
made after or consequent to the final judgment Eugenio Basbas, Sr. and Teofilo Aras [sic];
aforementioned, wherein the names of the other defendants 3. That plaintiff Teofilo Aras, Sr. has a daughter named Fedeliza
were mentioned in the body thereof. After considering the Aras;
merits of the various contentions, the Court is of the view that Issues
the complaint had to limit itself to the names of the original 1. Whether . . . the plaintiffs are entitled to revival of judgment in
parties appearing in the original judgment now being sought the earlier [land registration] case;
for revival. The interest of the plaintiffs in seeking implementation 2. Whether . . . the defendants except for defendant Rufino Aras
or execution of the judgment sought to be revived which would are the proper parties in the present action;
involve the other defendants can be taken when the judgment shall 3. Whether . . . the complaint states a cause of action;
have been revived. CHaDIT 4. Whether . . . defendants are entitled to their counterclaim,
In this connection therefore and as part of the matters to be made and; TIDHCc
part in the pre-trial conference, in the exercise of the authority 5. Whether judgment on the pleadings is allowed or is tenable. 39
granted to it by law, this Court directs the plaintiffs to make the Respondents subsequently filed an Omnibus Motion for Judgment
necessary amendment and/or to submit a manifestation first on the Pleadings and/or Summary Judgment. 40 They contended
to this Court on the point above raised regarding amendment that since petitioners' Answer failed to tender an issue, they having
of the designation of the parties having in mind the objection of expressly admitted the material allegations in the complaint,
the defendants who manifested that should there be an particularly paragraphs 4 to 12, a judgment on the pleadings or
amendment, this counter-claim shall be disregarded since they summary judgment is proper.
were brought in unnecessarily in this kind of action. Petitioners filed an Opposition Re: Omnibus Motion for Judgment
on the Pleadings and/or Summary Judgment and Memorandum
Re: Failure of Plaintiff Beata Sayson to Appear in the Pre-trial 2004 and April 19, 2006 when it affirmed the Order of the Regional
Conference. 41 They argued that the case cannot be decided Trial Court of Ormoc City dated May 21, 2001 and declared that
based on the pleadings nor through summary judgment petitioners' argument that respondents' complaint failed to state a
considering that the controverted stipulations and issues defined cause of action has no merit.
in the Pre-Trial Order must be proven by evidence. In addition, 3. The Honorable Court of Appeals clearly committed serious
they questioned the Special Power of Attorney (SPA) executed by errors of law when it affirmed the Order of the Regional Trial Court
Beata in Canada empowering her son Roberto, Jr. to appear on of Ormoc City which ordered the revival of the Judgment of this
her behalf in the pre-trial conference. They argued that since said Court of Appeals in CA-G.R. No. 66541 entitled Beata Sayson and
SPA has not been authenticated by a Philippine Consulate official, Roberto Sayson vs. Eugenio Basbas, et al., despite the fact that
it is not sufficient authorization and hence, Beata cannot be this was not the judgment sought to be revived in Civil Case No.
considered to have attended the pre-trial conference. The case 3312-0;
must, therefore, be dismissed insofar as she is concerned. 4. The Honorable Court of Appeals clearly committed serious
Ruling of the Regional Trial Court errors of law in ruling that the duly notarized Special Power of
In resolving respondents' Omnibus Motion for Judgment on the Attorney in favor of Roberto Sayson[,] Jr. is valid and the latter is
Pleadings and/or Summary Judgment, the RTC found that authorized to represent his mother, Beata Sayson[,] which is
petitioners' Answer does not essentially tender an issue since the contrary to the ruling in the case of ANGELITA LOPEZ,
material allegations of the Complaint were admitted. Hence, said represented by PRISCILLA L. TY vs. COURT OF APPEALS,
court issued an Order 42 dated May 21, 2001, the dispositive REGIONAL TRIAL COURT OF QUEZON CITY . . . (G.R. No.
portion of which reads: 77008, December 29, 1987). 50
Wherefore, finding merit in the motion, judgment is hereby The Parties' Arguments
rendered for and in favor of the plaintiffs and against the Petitioners insist that a judgment on the pleadings or a summary
defendants ordering the revival of the decision of the Court of judgment is not proper in this case since the controverted
Appeals promulgated on July 24, 1985 affirming the decree of stipulations and the first three issues enumerated in the pre-trial
registration of this Court in the decision of the Land Registration order involve facts which must be threshed out during trial. They
Case No. 0-177 dated March 22, 1979, and of the final Order of also claim that the Complaint for Revival of Judgment states no
this Court dated September 13, 1989 and upon finality of this cause of action because the September 13, 1989 Order which it
Order, ordering the issuance of Writ of Possession for the lot made sought to revive is not the "judgment" contemplated under Section
subject of the decision. Without pronouncement as to costs. 6, Rule 39 of the Rules of Court and, therefore, cannot be the
SO ORDERED. 43 subject of such an action. Moreover, they argue that the CA
Petitioners thus filed a Notice of Appeal 44 which was approved in Decision in the land registration case should not have been
an Order dated June 06, 2001. 45 revived as same was not prayed for in the Complaint for Revival
Ruling of the Court of Appeals of Judgment. Lastly, petitioners assail the SPA which authorized
Finding no merit in the appeal, the CA denied the same in a Roberto, Jr. to represent his mother, Beata, during the pre-trial
Decision 46 dated February 17, 2004. It noted that petitioners' conference, it not having been authenticated by a Philippine
Answer admitted almost all of the allegations in respondents' consulate officer in Canada where it was executed. Citing Lopez v.
complaint. Hence, the RTC committed no reversible error when it Court of Appeals, 51 they contend that said document cannot be
granted respondents' Motion for Judgment on the Pleadings admitted in evidence and hence, Beata was not duly represented
and/or Summary Judgment. The appellate court likewise found during said pre-trial conference. The case, therefore, should have
untenable the issue as regards the failure of the complaint to state been dismissed insofar as she is concerned.
a cause of action. To the appellate court, petitioners' refusal to For their part, respondents point out that the RTC's basis in
vacate the subject property despite the final and executory granting the Motion for Judgment on the Pleadings and/or
Decision of the CA in the land registration case and the September Summary Judgment was petitioners' admission of practically all
13, 1989 Order of the RTC for them to vacate the same, clearly the material allegations in the complaint. They aver that Section 1,
support respondents' cause of action against them. Also contrary Rule 34 of the Rules of Court clearly provides that where an
to petitioners' posture, the September 13, 1989 Order is a final answer fails to tender an issue or otherwise admits the material
order as it finally disposed of the controversy between the parties allegations of the adverse party's pleading, the court may, on
in the land registration case. The CA likewise found the SPA motion of that party, direct judgment on the pleadings. Also, the
executed by Beata in favor of Roberto, Jr. as valid, hence, she was test for a motion for summary judgment is whether the pleadings,
duly represented during the pre-trial conference. The dispositive affidavits or exhibits in support of the motion are sufficient to
portion of said CA Decision reads: overcome the opposing papers and to justify a finding as a matter
WHEREFORE, premises considered, the present appeal is of law that there is no defense to the action or the claim is clearly
DENIED. The May 21, 2001 Decision of the Regional Trial Court meritorious. And since, as found by the CA, petitioners' Answer did
of Ormoc City, Branch 35 is AFFIRMED. not tender an issue and that there is no defense to the action, the
SO ORDERED. 47 grant of the Motion for Judgment on the Pleadings and/or
Their Motion for Reconsideration 48 having been denied in a Summary Judgment was appropriate. Respondents likewise
Resolution 49 dated April 19, 2006, petitioners are now before this contend that if their prayer in the Complaint is taken in its proper
Court through the present Petition for Review context, it can be deduced that what they were really seeking is
on Certiorari. CAaDTH the implementation of the CA Decision dated July 24, 1985 and
Issues the orders ancillary thereto. With respect to the SPA, they submit
Petitioners impute upon the CA the following errors: that the law does not require that a power of attorney be notarized.
1. The Honorable Court of Appeals clearly committed serious Moreover, Section 4, Rule 18 of the Rules of Court simply requires
errors of law in its decision and Resolution dated February 17, that a representative appear fully authorized "in writing". It does
2004 and April 19, 2006 when it affirmed the Order of the Regional not specify a particular form of authority.
Trial Court dated May 21, 2001 and declared that no reversible Our Ruling
error was committed by the Regional Trial Court of Ormoc City in There is no merit in the petition.
granting respondents' motion for judgment on the pleadings and/or I. The instant case is proper for the rendition of a summary
summary judgment; judgment.
2. The Honorable Court of Appeals clearly committed serious
errors of law in its Decision and Resolution dated February 17,
Petitioners principally assail the CA's affirmance of the RTC's down to questions relating to the propriety of the action resorted to
Order granting respondents' Motion for Judgment on the by respondents, which is revival of judgment, and to the proper
Pleadings and/or Summary Judgment. parties thereto the same questions which we have earlier
In Tan v. De la Vega, 52 citing Narra Integrated Corporation v. declared as not constituting genuine issues.
Court of Appeals, 53 the court distinguished summary judgment In sum, this Court holds that the instant case is proper for the
from judgment on the pleadings, viz.: rendition of a summary judgment, hence, the CA committed no
The existence or appearance of ostensible issues in the pleadings, error in affirming the May 21, 2001 Order of the RTC granting
on the one hand, and their sham or fictitious character, on the respondents' Motion for Judgment on the Pleadings and/or
other, are what distinguish a proper case for summary judgment Summary Judgment.
from one for a judgment on the pleadings. In a proper case for II. The Complaint states a cause of action.
judgment on the pleadings, there is no ostensible issue at all Petitioners contend that the complaint states no cause of action
because of the failure of the defending party's answer to raise an since the September 13, 1989 Order sought to be revived is not
issue. On the other hand, in the case of a summary judgment, the judgment contemplated under Section 6, Rule 39 of the Rules
issues apparently exist i.e., facts are asserted in the complaint of Court. They also aver that the RTC erred when it ordered the
regarding which there is as yet no admission, disavowal or revival not only of the September 13, 1989 Order but also of the
qualification; or specific denials or affirmative defenses are in truth July 24, 1985 CA Decision, when what was prayed for in the
set out in the answer but the issues thus arising from the complaint was only the revival of the former.
pleadings are sham, fictitious or not genuine, as shown by This Court, however, agrees with respondents that these matters
affidavits, depositions, or admissions. . . . . TCaEAD have already been sufficiently addressed by the RTC in its Order
Simply stated, what distinguishes a judgment on the pleadings of May 9, 1997 57 and we quote with approval, viz.:
from a summary judgment is the presence of issues in the Answer The body of the Complaint as well as the prayer mentioned about
to the Complaint. When the Answer fails to tender any issue, that the executory decision of the Court of Appeals promulgated on
is, if it does not deny the material allegations in the complaint or July 24, 1985 that had to be finally implemented. So it appears to
admits said material allegations of the adverse party's pleadings this Court that the Complaint does not alone invoke or use as
by admitting the truthfulness thereof and/or omitting to deal with subject thereof the Order of this Court which would implement the
them at all, a judgment on the pleadings is appropriate. 54 On the decision or judgment regarding the land in question. The Rules of
other hand, when the Answer specifically denies the material Court referring to the execution of judgment, particularly Rule 39,
averments of the complaint or asserts affirmative defenses, or in Sec. 6, provides a mechanism by which the judgment that had not
other words raises an issue, a summary judgment is proper been enforced within five (5) years from the date of its entry or
provided that the issue raised is not genuine. "A 'genuine issue' from the date the said judgment has become final and executory
means an issue of fact which calls for the presentation of evidence, could be enforced. In fact, the rule states: ". . . judgment may be
as distinguished from an issue which is fictitious or contrived or enforced by action."
which does not constitute a genuine issue for trial." 55 So in this Complaint, what is sought is the enforcement of a
a) Judgment on the pleadings is not judgment and the Order of this Court dated September 13, 1989
proper because petitioners' Answer is part of the process to enforce that judgment. To the mind of the
tendered issues. Court, therefore, the Complaint sufficiently states a cause of
In this case, we note that while petitioners' Answer to respondents' action. 58
Complaint practically admitted all the material allegations therein, III. Any perceived defect in the SPA would not serve to bar the
it nevertheless asserts the affirmative defenses that the action for case from proceeding.
revival of judgment is not the proper action and that petitioners are Anent the SPA, we find that given the particular circumstances in
not the proper parties. As issues obviously arise from these the case at bar, an SPA is not even necessary such that its efficacy
affirmative defenses, a judgment on the pleadings is clearly or the lack of it would not in any way preclude the case from
improper in this case. proceeding. This is because upon Roberto, Sr.'s death, Roberto,
However, before we consider this case appropriate for the Jr., in succession of his father, became a co-owner of the subject
rendition of summary judgment, an examination of the issues property together with his mother, Beata. As a co-owner, he may,
raised, that is, whether they are genuine issues or not, should first by himself alone, bring an action for the recovery of the co-owned
be made. property pursuant to the well-settled principle that "in a co-
b) The issues raised are not genuine ownership, co-owners may bring actions for the recovery of co-
issues, hence rendition of summary owned property without the necessity of joining all the other co-
judgment is proper. owners as co-plaintiffs because the suit is presumed to have been
To resolve the issues of whether a revival of judgment is the proper filed for the benefit of his co-owners." 59 STaAcC
action and whether respondents are the proper parties thereto, the While we note that the present action for revival of judgment is not
RTC merely needed to examine the following: 1) the RTC Order an action for recovery, the September 13, 1989 Order sought to
dated September 13, 1989, to determine whether same is a be revived herein ordered the petitioners, among others, to vacate
judgment or final order contemplated under Section 6, Rule 39 of the subject property pursuant to the final and executory judgment
the Rules of Court; and, 2) the pleadings of the parties and of the CA affirming the CFI's adjudication of the same in favor of
pertinent portions of the records 56 showing, among others, who respondents. This Order was issued after the failure to enforce the
among the respondents were oppositors to the land registration writ of execution and alias writ of execution due to petitioner's
case, the heirs of such oppositors and the present occupants of refusal to vacate the property. To this Court's mind, respondent's
the property. Plainly, these issues could be readily resolved based purpose in instituting the present action is not only to have the CA
on the facts established by the pleadings. A full-blown trial on Decision in the land registration case finally implemented but
these issues will only entail waste of time and resources as they ultimately, to recover possession thereof from petitioners. This
are clearly not genuine issues requiring presentation of evidence. action is therefore one which Roberto, Jr., as co-owner, can bring
Petitioners aver that the RTC should not have granted and prosecute alone, on his own behalf and on behalf of his co-
respondents' Motion for Judgment on the Pleadings and/or owner, Beata. Hence, a dismissal of the case with respect to Beata
Summary Judgment because of the controverted stipulations and pursuant to Sec. 5, 60 Rule 18 of the Rules of Court will be futile
the first three issues enumerated in the Pre-trial Order, which, as the case could nevertheless be continued by Roberto, Jr. in
according to them, require the presentation of evidence. These behalf of the two of them.
stipulations and issues, however, when examined, basically boil
WHEREFORE, the Petition of Review of an Accion Publiciana before the RTC of Antipolo City (Branch
on Certiorari is DENIED and the assailed Decision of the Court of 72); and that at the time of the filing of the Complaint, the matter
Appeals dated February 17, 2004 and Resolution dated April 19, was still subject of an appeal before the CA, under CA-G.R. CV
2006 in CA-G.R. CV No. 72385 are AFFIRMED. No. 53509.
SO ORDERED. The RTC Decision
||| (Basbas v. Sayson, G.R. No. 172660, [August 24, 2011], 671 In its Decision, 9 dated July 16, 2004, the RTC dismissed the
PHIL 662-686) complaint for lack of cause of action and for being an erroneous
remedy. The RTC stated that a title issued upon a patent may be
GALANG v. REYES annulled only on grounds of actual and intrinsic fraud, which much
THIRD DIVISION consist of an intentional omission of fact required by law to be
[G.R. No. 184746. August 15, 2012.] stated in the application or willful statement of a claim against the
SPOUSES CRISPIN GALANG and truth. In the case before the trial court, the Reyeses presented no
CARIDAD GALANG, petitioners, vs. SPOUSES CONRADO evidence of fraud despite their allegations that the Galangs were
S. REYES AND FE DE KASTRO REYES (As substituted by not in possession of the property and that it was part of a dried
their legal heir: Hermenigildo K. Reyes), respondents. creek. There being no evidence, these contentions remained
DECISION allegations and could not defeat the title of the Galangs. The RTC
MENDOZA, J p: wrote:
This petition for review on certiorari under Rule 45 seeks to A title issued upon patent may be annulled only on ground of actual
reverse and set aside the April 9, 2008 Decision 1 of the Court of fraud.
Appeals (CA) and its October 6, 2008 Resolution, 2 in CA-G.R. Such fraud must consist [of] an intentional omission of fact
CV. No. 85660. required by law to be stated in the application or willful statement
The Facts of a claim against the truth. It must show some specific facts
On September 4, 1997, spouses Conrado S. Reyes and Fe de intended to deceive and deprive another of his right. The fraud
Kastro Reyes (the Reyeses) filed a case for the annulment of must be actual and intrinsic, not merely constructive or intrinsic;
Original Certificate of Title (OCT) No. P-928 against spouses the evidence thereof must be clear, convincing and more than
Crispin and Caridad Galang (the Galangs) with the Regional Trial merely preponderant, because the proceedings which are being
Court, Antipolo, Rizal (RTC), docketed as Civil Case No. 97-4560. assailed as having been fraudulent are judicial proceedings, which
In their Complaint, 3 the Reyeses alleged that they owned two by law, are presumed to have been fair and regular. (Libudan v.
properties: (1) a subdivision project known as Ponderosa Heights Palma Gil 45 SCRA 17) ADaEIH
Subdivision (Ponderosa), and (2) an adjoining property covered by However, aside from allegations that defendant Galang is not in
Transfer Certificate of Title (TCT) No. 185252, with an area of possession of the property and that the property was part of a dried
1,201 sq.m.; 4 that the properties were separated by the creek, no other sufficient evidence of fraud was presented by the
Marigman Creek, which dried up sometime in 1980 when it plaintiffs. They have, thus, remained allegations, which cannot
changed its course and passed through Ponderosa; that the defeat the defendants title. 10
Galangs, by employing manipulation and fraud, were able to The RTC added that the land, having been acquired through a
obtain a certificate of title over the dried up creek bed from the homestead patent, was presumably public land. Therefore, only
Department of Environment and Natural Resources (DENR), the State can institute an action for the annulment of the title
through its Provincial Office (PENRO); that, specifically, the covering it.
property was denominated as Lot 5735, Cad 29 Ext., Case-1, with It further opined that because the Reyeses claimed to have
an area of 1,573 sq.m. covered by OCT No. P-928; that they acquired the property by right of accretion, they should have filed
discovered the existence of the certificate of title sometime in an action for reconveyance, explaining "[t]hat the remedy of
March 1997 when their caretaker, Federico Enteroso (Enteroso), persons whose property had been wrongly or erroneously
informed them that the subject property had been fraudulently registered in another's name is not to set aside the decree/title, but
titled in the names of the Galangs; that in 1984, prior to such an action for reconveyance, or if the property has passed into the
discovery, Enteroso applied for the titling of the property, as he hands of an innocent purchaser for value, an action for
had been occupying it since 1968 and had built his house on it; damages." 11
that, later, Enteroso requested them to continue the application The Court of Appeals Decision
because of financial constraints on his part; 5 that they continued In its Decision, dated April 9, 2008, the CA reversed and set
the application, but later learned that the application papers were aside the RTC decision and ordered the cancellation of OCT No.
lost in the Assessor's Office; 6 and that as the owners of the land P-928 and the reconveyance of the land to the Reyeses.
where the new course of water passed, they are entitled to the The CA found that the Reyeses had proven by preponderance of
ownership of the property to compensate them for the loss of the evidence that the subject land was a portion of the creek bed that
land being occupied by the new creek. aICHEc was abandoned through the natural change in the course of the
The Galangs in their Answer 7 denied that the land subject of the water, which had now traversed a portion of Ponderosa. As
complaint was part of a creek and countered that OCT No. P-928 owners of the land occupied by the new course of the creek, the
was issued to them after they had complied with the free patent Reyeses had become the owners of the abandoned creek
requirements of the DENR, through the PENRO; that they and bed ipso facto. Inasmuch as the subject land had become private,
their predecessor-in-interest had been in possession, occupation, a free patent issued over it was null and void and produced no
cultivation, and ownership of the land for quite some time; that the legal effect whatsoever. A posteriori, the free patent covering the
property described under TCT No. 185252 belonged to subject land, a private land, and the certificate of title issued
Apolonio Galang, their predecessor-in-interest, under OCT No. pursuant thereto, are null and void. 12
3991; that the property was transferred in the names of the The Galangs moved for a reconsideration, 13 but their motion was
Reyeses through falsified document; 8 that assuming ex gratia denied in a Resolution dated October 6, 2008.
argumenti that the creek had indeed changed its course and Hence, this petition.
passed through Ponderosa, the Reyeses had already claimed for Issues
themselves the portion of the dried creek which adjoined and co- The Galangs present, as warranting a review of the questioned CA
existed with their property; that Enteroso was able to occupy a decision, the following grounds: ACDIcS
portion of their land by means of force, coercion, machinations, THE HONORABLE COURT OF APPEALS COMMITTED
and stealth in 1981; that such unlawful entry was then the subject GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF
JURISDICTION IN NOT RESOLVING THAT THE OFFICE OF grant of title to the defendant. In Heirs of Marciano Nagano v.
THE SOLICITOR GENERAL, NOT THE PRIVATE Court of Appeals we ruled
RESPONDENTS, HAS THE SOLE AUTHORITY TO FILE . . . from the allegations in the complaint . . . private respondents
[CASES FOR] ANNULMENT OF TITLE INVOLVING PUBLIC claim ownership of the 2,250 square meter portion for having
LAND. possessed it in the concept of an owner, openly, peacefully,
THE HONORABLE COURT OF APPEALS COMMITTED publicly, continuously and adversely since 1920. This claim is an
GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF assertion that the lot is private land . . . . Consequently, merely on
JURISDICTION IN HOLDING THAT PRIVATE RESPONDENTS the basis of the allegations in the complaint, the lot in question is
HAVE [A] CAUSE OF ACTION AGAINST PETITIONERS EVEN apparently beyond the jurisdiction of the Director of the Bureau of
WITHOUT EXHAUSTION OF ADMINISTRATIVE REMED[IES]. Lands and could not be the subject of a Free Patent. Hence, the
THE HONORABLE COURT OF APPEALS COMMITTED dismissal of private respondents' complaint was premature and
GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF trial on the merits should have been conducted to thresh out
JURISDICTION IN DEVIATING FROM THE FINDINGS OF FACT evidentiary matters. It would have been entirely different if the
OF THE TRIAL COURT AND INTERPRETING ARTICLE 420 IN action were clearly for reversion, in which case, it would have to
RELATION TO ARTICLE 461 OF THE CIVIL CODE OF THE be instituted by the Solicitor General pursuant to Section 101
PHILIPPINES BY SUBSTITUTING ITS OWN OPINION BASED of C.A. No. 141 . . .
ON ASSUMPTION OF FACTS. 14 It is obvious that private respondents allege in their complaint all
A reading of the records discloses that these can be synthesized the facts necessary to seek the nullification of the free patents as
into two principal issues, to wit: (1) whether the Reyeses can file well as the certificates of title covering Lot 1015 and Lot 1017.
the present action for annulment of a free patent title and Clearly, they are the real parties in interest in light of their
reconveyance; and (2) if they can, whether they were able to prove allegations that they have always been the owners and
their cause of action against the Galangs. possessors of the two (2) parcels of land even prior to the issuance
The Court's Ruling of the documents of title in petitioners' favor, hence the latter could
Regarding the first issue, the Galangs state that the property was only have committed fraud in securing them EACIaT
formerly a public land, titled in their names by virtue of Free Patent . . . That plaintiffs are absolute and exclusive owners and in actual
No. 045802-96-2847 issued by the DENR. Thus, they posit that possession and cultivation of two parcels of agricultural lands
the Reyeses do not have the personality and authority to institute herein particularly described as follows [technical description of
any action for annulment of title because such authority is vested Lot 1017 and Lot 1015] . . . 3. That plaintiffs became absolute and
in the Republic of the Philippines, through the Office of the Solicitor exclusive owners of the abovesaid parcels of land by virtue of
General. 15 inheritance from their late father, Honorio Dacut, who in turn
In this regard, the Galangs are mistaken. The action filed by the acquired the same from a certain Blasito Yacapin and from then
Reyeses seeks the transfer to their names of the title registered in on was in possession thereof exclusively, adversely and in the
the names of the Galangs. In their Complaint, they alleged that: concept of owner for more than thirty (30) years . . . 4. That
first, they are the owners of the land, being the owners of the recently, plaintiff discovered that defendants, without the
properties through which the Marigman creek passed when it knowledge and consent of the former, fraudulently applied for
changed its course; and second, the Galangs illegally patent the said parcels of land and as a result thereof certificates
dispossessed them by having the same property registered in their of titles had been issued to them as evidenced by certificate of title
names. It was not an action for reversion which requires that the No. P-19819 in the name of the Hrs. of Ambrocio Kionisala, and
State be the one to initiate the action in order for it to prosper. The No. P-20229 in the name of Isabel Kionisala . . . 5. That the patents
distinction between the two actions was elucidated in the case issued to defendants are null and void, the same having been
of Heirs of Kionisala v. Heirs of Dacut, 16 where it was issued fraudulently, defendants not having been and/or in actual
written: CTIDcA possession of the litigated properties and the statement they may
An ordinary civil action for declaration of nullity of free have made in their application are false and without basis in fact,
patents and certificates of title is not the same as an action and, the Department of Environment and Natural Resources not
for reversion. The difference between them lies in the allegations having any jurisdiction on the properties the same not being
as to the character of ownership of the realty whose title is sought anymore public but already private property . . .
to be nullified. In an action for reversion, the pertinent It is not essential for private respondents to specifically state in the
allegations in the complaint would admit State ownership of complaint the actual date when they became owners and
the disputed land. Hence in Gabila v. Barriga where the plaintiff possessors of Lot 1015 and Lot 1017. The allegations to the effect
in his complaint admits that he has no right to demand the that they were so preceding the issuance of the free patents and
cancellation or amendment of the defendant's title because even the certificates of title, i.e., "the Department of Environment and
if the title were cancelled or amended the ownership of the land Natural Resources not having any jurisdiction on the properties the
embraced therein or of the portion affected by the amendment same not being anymore public but already private property," are
would revert to the public domain, we ruled that the action was for unquestionably adequate as a matter of pleading to oust the State
reversion and that the only person or entity entitled to relief would of jurisdiction to grant the lots in question to petitioners. If at all,
be the Director of Lands. the oversight in not alleging the actual date when private
On the other hand, a cause of action for declaration of nullity respondents' ownership thereof accrued reflects a mere deficiency
of free patent and certificate of title would require allegations in details which does not amount to a failure to state a cause of
of the plaintiff's ownership of the contested lot prior to the action. The remedy for such deficiency would not be a motion to
issuance of such free patent and certificate of title as well as dismiss but a motion for bill of particulars so as to enable the filing
the defendant's fraud or mistake; as the case may be, in of appropriate responsive pleadings.
successfully obtaining these documents of title over the With respect to the purported cause of action for reconveyance,
parcel of land claimed by plaintiff. In such a case, the nullity it is settled that in this kind of action the free patent and the
arises strictly not from the fraud or deceit but from the fact that the certificate of title are respected as incontrovertible. What is
land is beyond the jurisdiction of the Bureau of Lands to bestow sought instead is the transfer of the property, in this case the
and whatever patent or certificate of title obtained therefor is title thereof, which has been wrongfully or erroneously
consequently void ab initio. The real party in interest is not the registered in the defendant's name. All that must be alleged
State but the plaintiff who alleges a pre-existing right of in the complaint are two (2) facts which admitting them to be
ownership over the parcel of land in question even before the true would entitle the plaintiff to recover title to the disputed
land, namely, (1) that the plaintiff was the owner of the land jurisdiction over the subject lot, regarding the nature of change in
and, (2) that the defendant had illegally dispossessed him of the course of the creek's waters. Worse, what is
the same. DScTaC even uncertain in the present case is the exact location of the
We rule that private respondents have sufficiently pleaded (in subject matter of dispute. This is evident from the decision of the
addition to the cause of action for declaration of free patents and Regional Trial Court which failed to specify which portion of the
certificates of title) an action for reconveyance, more specifically, land is actually being disputed by the contending parties.
one which is based on implied trust. An implied trust arises where xxx xxx xxx
the defendant (or in this case petitioners) allegedly acquires the Since the propriety of the remedy taken by private respondents in
disputed property through mistake or fraud so that he (or they) the trial court and their legal personality to file the aforesaid action
would be bound to hold and reconvey the property for the benefit depends on whether or not the litigated property in the present
of the person who is truly entitled to it. In the complaint, private case still forms part of the public domain, or had already been
respondents clearly assert that they have long been the absolute converted into a private land, the identification of the actual
and exclusive owners and in actual possession and cultivation of portion of the land subject of the controversy becomes
Lot 1015 and Lot 1017 and that they were fraudulently deprived of necessary and indispensable in deciding the issues herein
ownership thereof when petitioners obtained free patents and involved.
certificates of title in their names. These allegations certainly xxx xxx xxx
measure up to the requisite statement of facts to constitute an Notably, private respondents failed to submit during trial any
action for reconveyance. 17 [Emphases supplied] convincing proof of a similar declaration by the government that a
In this case, the complaint instituted by the Reyeses before the portion of the Marigman Creek had already dried-up and that the
RTC was for the annulment of the title issued to the Galangs, and same is already considered alienable and disposable agricultural
not for reversion. Thus, the real party in interest here is not the land which they could acquire through acquisitive prescription.
State but the Reyeses who claim a right of ownership over the Indeed, a thorough investigation is very imperative in the light of
property in question even before the issuance of a title in favor of the conflicting factual issues as to the character and actual location
the Galangs. Although the Reyeses have the right to file an action of the property in dispute. These factual issues could properly be
for reconveyance, they have failed to prove their case. Thus, on resolved by the DENR and the Land Management Bureau, which
the second issue, the Court agrees with the RTC that the Reyeses have the authority to do so and have the duty to carry out the
failed to adduce substantial evidence to establish their allegation provisions of the Public Land Act, after both parties have been fully
that the Galangs had fraudulently registered the subject property given the chance to present all their evidence. 19 [Emphases
in their names. supplied]
The CA reversed the RTC decision giving the reason that the Moreover, during cross-examination, Conrado S. Reyes admitted
property was the former bed of Marigman Creek, which changed that the plan surveyed for Fe de Castro Reyes and Jose de
its course and passed through their Ponderosa property, thus, Castro, * marked before the RTC as Exhibit "A-2," was prepared
ownership of the subject property was automatically vested in by a geodetic engineer without conducting an actual survey on the
them. ground:
The law in this regard is covered by Article 461 of the Civil Code, COUNSEL FOR DEFENDANTS: TAcSaC
which provides: I am showing to you Exhibit "A-2" which is a plan surveyed for Fe
Art. 461. River beds which are abandoned through the natural de Kastro Reyes and Jose de Kastro. This plan was prepared by
change in the course of the waters ipso facto belong to the owners the geodetic engineer without conducting actual survey on the
whose lands are occupied by the new course in proportion to the ground, is it not?
area lost. However, the owners of the lands adjoining the old bed A: I cannot agree to that question.
shall have the right to acquire the same by paying the value Q: But based on the certification of the geodetic engineer, who
thereof, which value shall not exceed the value of the area prepared this it appears that this plan was plotted only based on
occupied by the new bed. the certification on this plan marked as Exhibit "A-2", is it not?
If indeed a property was the former bed of a creek that changed A: Yes, sir.
its course and passed through the property of the claimant, then, Q: So, based on this certification that the geodetic engineer
pursuant to Article 461, the ownership of the old bed left to dry by conducted the survey of this plan based on the technical
the change of course was automatically acquired by the description without conducting actual survey on the ground?
claimant. 18 Before such a conclusion can be reached, the fact A: Yes, sir. 20
of natural abandonment of the old course must be shown, that is, At some point, Mr. Reyes admitted that he was not sure that the
it must be proven that the creek indeed changed its course without property even existed:
artificial or man-made intervention. Thus, the claimant, in this case COUNSEL FOR DEFENDANTS:
the Reyeses, must prove three key elements by clear and The subject matter of this document Exhibit I is that, that property
convincing evidence. These are: (1) the old course of the creek, which at present is titled in the name of Fe de
(2) the new course of the creek, and (3) the change of course of Castro Reyes married to Conrado Reyes, et al. is that correct?
the creek from the old location to the new location A: Yes.
by natural occurrence. DcCIAa Q: The subject matter of this case now is the adjoining lot of this
In this regard, the Reyeses failed to adduce indubitable evidence TCT 185252, is that correct?
to prove the old course, its natural abandonment and the new A: I do not know.
course. In the face of a Torrens title issued by the government, Q: You mean you do not know the lot subject matter of this case?
which is presumed to have been regularly issued, the evidence of A: I do not know whether it really exists.
the Reyeses was clearly wanting. Uncorroborated testimonial Q: Just answer the question, you do not know?
evidence will not suffice to convince the Court to order the A: Yes. 21
reconveyance of the property to them. This failure did not escape The conflicting claims here are (1) the title of the Galangs issued
the observation of the Office of the Solicitor General. Thus, it by the DENR, through the PENRO, and (2) the claim of the
commented: Reyeses, based on unsubstantiated testimony, that the land in
In the case at bar, it is not clear whether or not the Marigman question is the former bed of a dried up creek. As between these
Creek dried-up naturally back in 1980. Neither did private two claims, this Court is inclined to decide in favor of the Galangs
respondents submit any findings or report from the Bureau of who hold a valid and subsisting title to the property which, in the
Lands or the DENR Regional Executive Director, who has the absence of evidence to the contrary, the Court presumes to have
been issued by the PENRO in the regular performance of its did not heed the demand and refused to recognize the
official duty. TcAECH ownership of the respondents over the property. 10
The bottom line here is that, fraud and misrepresentation, as On March 16, 2004, the respondents filed an action for
grounds for cancellation of patent and annulment of title, should Recovery of Possession and/or Sum of Money against the
never be presumed, but must be proved by clear and convincing DepEd. 11 Respondents averred that since their late father did not
evidence, with mere preponderance of evidence not being have any immediate need of the land in 1965, he consented to the
adequate. Fraud is a question of fact which must be proved. 22 building of the temporary structure and allowed the
In this case, the allegations of fraud were never proven. There was conduct of classes in the premises. They claimed that they have
no evidence at all specifically showing actual fraud or been deprived of the use and the enjoyment of the portion of the
misrepresentation. Thus, the Court cannot sustain the findings of land occupied by the school, thus, they are entitled to just
the CA. compensation and reasonable rent for the use of property. 12
WHEREFORE, the petition is GRANTED. The April 9, 2008 In its Answer, the DepEd alleged that it owned the subject property
Decision and the October 6, 2008 Resolution of the Court of because it was purchased by civic-minded residents of Solana,
Appeals, in CA-G.R. CV. No. 85660, are Cagayan from Cepeda. It further alleged that contrary to
hereby REVERSED and SET ASIDE. Civil Case No. 97-4560 of respondents' claim that the occupation is by mere tolerance, the
the Regional Trial Court of Antipolo City, Branch 73, is hereby property has always been occupied and used adversely,
ordered DISMISSED for lack of merit. peacefully, continuously and in the concept of owner for almost
SO ORDERED. forty (40) years. 13 It insisted that the respondents had lost
||| (Spouses Galang v. Spouses Reyes, G.R. No. 184746, [August whatever right they had over the property through laches. 14
15, 2012], 692 PHIL 652-667) During the trial, respondents presented, inter alia, the OCT No. O-
627 registered in the name of Juan Cepeda; Tax Declarations also
DEPT OF EDUCATION v. CASIBANG in his name and the tax receipts showing that they had been
THIRD DIVISION paying real property taxes on the property since 1965. 15 They
[G.R. No. 192268. January 27, 2016.] also presented the Technical Description of the lot by
DEPARTMENT OF EDUCATION, represented by its Regional the Department of Environment and Natural Resources Land
Director, petitioner, vs. DELFINA C. CASIBANG, ANGELINA C. Management Services showing that the subject property was
CANAPI, ERLINDA C. BAJAN, LORNA G. GUMABAY, surveyed in the name of Cepeda and a certification from the
DIONISIA C. ALONZO, MARIA C. BANGAYAN and DIGNA C. Municipal Trial Court of Solana, Cagayan declaring that Lot 115
BINAYUG, respondents. was the subject of Cad Case No. N-13 in LRC Cad. Record No. N-
DECISION 200 which was adjudicated to Cepeda. 16
PERALTA, J p: On the other hand, despite notice and reset of hearing, the DepEd
For resolution of this Court is the Petition for Review failed to present its evidence or witness to substantiate its
on Certiorari, dated June 18, defense. 17
2010, of petitioner Department of Education (DepEd), represente Consequently, the RTC considered the case submitted for
d by its Regional Director seeking to reverse and set aside the decision and rendered a Decision dated January 10, 2008, finding
Decision 1 dated April 29, 2010 of the that the respondents are the owners of the subject property,
Court of Appeals (CA) affirming the Decision 2 dated January 10, thus: TIADCc
2008 of the Regional Trial Court (RTC) ofTuguegarao City, WHEREFORE, judgment is hereby rendered.
Cagayan, Branch 5, declaring the respondents the 1. Declaring plaintiffs as the owner of Lot 115 covered by Original
owners of property in controversy and ordering the DepEd to pay Certificate of Title No. O-627.
the value of the property. ETHIDa 2. Ordering the reconveyance of the portion of the subject
The antecedents follow: property occupied by the Solana North Central School, Solana,
The property in controversy is a seven thousand five hundred Cagayan. However, since restoration of possession of said
thirty-two (7,532) square meter portion of Lot 115 covered by portion by the defendant Department of Education is no longer
Original Certificate of Title (OCT) No. O-627 registered under the feasible or convenient because it is now used for the school
name of Juan Cepeda, the respondents' late father. 3 premises, the only relief available is for the government to pay due
Sometime in 1965, upon the request of the then Mayor Justo compensation which should have [been] done years ago.
Cesar Caronan, Cepeda allowed the construction and 2.1 To determine due compensation for the Solana North Central
operation of a school on the western portion of his property. The School the basis should be the price or value of the property at the
school is now known as Solana North Central School, operating time of taking.
under the control and supervision of the petitioner DepEd. 4 3. No pronouncement as to cost.
Despite Cepeda's death in 1983, the herein respondents and other SO ORDERED. 18
descendants of Cepeda continued to tolerate the use and The DepEd, through the Office of the Solicitor
possession of the property by the school. 5 General (OSG), appealed the case before the CA. In its appeal,
Sometime between October 31, 2000 and November 2, 2000, the the DepEd insisted that the respondents have lost their right over
respondents entered and occupied a portion of the property. Upon the subject property for their failure to assert the same for more
discovery of the said occupation, the teachers of the school than thirty (30) years, starting in 1965, when the Mayor placed the
brought the matter to the attention of the barangay captain. The school in possession thereof. 19
school officials demanded the respondents to vacate the The CA then affirmed the decision of the RTC. The dispositive
property. 6 However, the respondents refused to vacate the portion of the said decision reads:
property, and asserted Cepeda's ownership of the lot. 7 WHEREFORE, the appeal is DISMISSED, and the Decision dated
On June 21, 2001, the DepEd filed a Complaint for Forcible Entry 10 January 2008, of the Regional Trial Court, Branch 5,
and Damages against respondents before the Municipal Circuit Tuguegarao, Cagayan in Civil Case No. 6336 for
Trial Court (MCTC) of Solana-Enrile. The MCTC ruled in Recovery of Possession and/or Sum of Money, declaring plaintiffs
favor of the petitioner and directed respondents to vacate the as the owners of the property in controversy, and ordering
premises. 8 On appeal, the RTC affirmed the decision of the the Department of Education to pay them the value of the property
MCTC. 9 taken is AFFIRMED in toto.
Thereafter, respondents demanded the petitioner to either pay SO ORDERED. 20
rent, purchase the area occupied, or vacate the premises. DepEd
Aggrieved, the DepEd, through the OSG, filed before this Court serving claim that it acquired the property by virtue of a sale, the
the present petition based on the sole ground that: Torrens title of respondents must prevail. AIDSTE
THE COURT OF APPEALS ERRED IN AFFIRMING THE TRIAL It is undisputed that the subject property is covered by OCT No.
COURT'S DECISION THAT THE RESPONDENTS' RIGHT TO O-627, registered in the name of the Juan Cepeda. 33 A
RECOVER THE POSSESSION OF THE SUBJECT PROPERTY fundamental principle in land registration under the Torrens
IS NOT BARRED BY PRESCRIPTION AND/OR LACHES. 21 system is that a certificate of title serves as evidence of an
This Court finds the petition without merit. indefeasible and incontrovertible title to the property in favor of the
Laches, in a general sense, is the failure or neglect for an person whose name appears therein. 34Thus, the
unreasonable and unexplained length of time, to do that which, by certificate of title becomes the best proof of ownership of a
exercising due diligence, could or should have been done earlier; parcel of land. 35
it is negligence or omission to assert a right within a reasonable As registered owners of the lots in question, the respondents have
time, warranting a presumption that the party entitled to assert it a right to eject any person illegally occupying their property. This
either has abandoned it or declined to assert it. 22 right is imprescriptible. Even if it be supposed that they were
There is no absolute rule as to what constitutes laches or aware of the petitioner's occupation of the property, and
staleness of demand; each case is to be determined according to regardless of the length of that possession, the lawful owners
its particular circumstances. The question oflaches is addressed have a right to demand the return of their property at any time as
to the sound discretion of the court, and since laches is an long as the possession was unauthorized or merely tolerated, if at
equitable doctrine, its application is controlled by equitable all. This right is never barred by laches. 36
considerations. It cannot work to defeat justice or to perpetrate Case law teaches that those who occupy the land of another at the
fraud and injustice. 23 latter's tolerance or permission, without any contract between
Laches is evidentiary in nature, a fact that cannot be established them, are necessarily bound by an implied promise that the
by mere allegations in the pleadings. 24 The following elements, occupants will vacate the property upon demand. 37
as prescribed in the case of Go Chi Gun, et al. v. Co Cho, et In the case of Sarona, et al. v. Villegas, et al., 38 this Court
al., 25 must be present to constitute laches: described what tolerated acts mean, in this language:
. . . (1) conduct on the part of the defendant, or of one under whom Professor Arturo M. Tolentino states that acts merely tolerated are
he claims, giving rise to the situation of which complaint is made "those which by reason of neighborliness or familiarity, the
for which the complaint seeks a remedy; (2) delay in asserting the owner of property allows his neighbor or another person to do on
complainant's rights, the complainant having had knowledge or the property; they are generally those particular services or
notice, of the defendant's conduct and having been afforded an benefits which one's property can give to another without material
opportunity to institute a suit; (3) lack of knowledge or notice on injury or prejudice to the owner, who permits them
the part of the defendant that the complainant would assert the out of friendship or courtesy." . . . . and, Tolentino
right on which he bases his suit; and (4) injury or prejudice to the continues, even though "this is continued for a long time, no
defendant in the event relief is accorded to the complainant, or the right will be acquired by prescription." . . . 39
suit is not held to be barred. 26 It was out of respect and courtesy to the then Mayor who was a
To refute the respondents' claim that its possession of the subject distant relative that Cepeda consented to the building of the
lot was merely tolerated, the DepEd averred that it owned the school. 40 The occupancy of the subject property by the DepEd to
subject property because the land was purchased by the civic- conduct classes therein arose from what Professor Arturo
minded residents of Solana. 27 It further alleged that since it was Tolentino refers to as the sense of "neighborliness or
the then Mayor who convinced Cepeda to allow the school to familiarity" of Cepeda to the then Mayor that he allowed the said
occupy the property and use the same, it believed in good faith occupation and use of his property.
that the ownership of the property was already transferred to it. 28 Professor Tolentino, as cited in the Sarona case, adds that
However, the DepEd did not present, in addition to the tolerated acts are acts of little disturbances which a person, in the
deed of sale, a duly-registered certificate of title in proving the interest of neighborliness or friendly relations, permits others to do
alleged transfer or sale of the property. Aside from its allegation, on his property, such as passing over the land, tying a horse
the DepEd did not adduce any evidence to the therein, or getting some water from a well. 41 In tolerated acts, the
transfer of ownership of the lot, or that Cepeda received any said permission of the owner for the acts done in his property
consideration for the purported sale. arises from an "impulse of sense of neighborliness or good
On the other hand, to support their claim of ownership of the familiarity with persons" 42 or out of "friendship or
subject lot, respondents presented the following: (1) the OCT No. courtesy," 43 and not out of duty or obligation. By
O-627 registered in the name of Juan Cepeda; 29 (2) Tax virtue of tolerance that is considered as an authorization,
Declarations in the name of Cepeda and the tax receipts showing permission, or license, acts of possession are realized or
the payment of the real property taxes on the property since performed. 44
1965; 30 (3) Technical Description of the lot by Thus, in light of the DepEd's admission that it was the then Mayor
the Department of Environment and Natural Resources Land who convinced Cepeda to allow its use of his property and in the
Management Services, surveyed in the name of Cepeda; 31 and absence of evidence that the same was indeed sold to it, the
(4) Certification from the Municipal Trial Court of Solana, Cagayan occupation and use as school site of the subject lot by the DepEd
declaring that Lot 115 was adjudicated to Cepeda. 32 upon Cepeda's permission is considered a tolerated act. Cepeda
After a scrutiny of the records, this Court finds that the above were allowed the use of his property out of his respect, courtesy and
sufficient to resolve the issue on who had better familiarity with the then Mayor who convinced him to allow the
right of possession. That being the case, it is the burden of the use of his property as a school site.
DepEd to prove otherwise. Unfortunately, the DepEd failed to Considering that the occupation of the subject lot is by mere
present any evidence to support its claim that the disputed land tolerance or permission of the respondents, the DepEd, without
was indeed purchased by the residents. By the DepEd's any contract between them, is bound by an implied promise that it
admission, it was the fact that the then Mayor of Solana, Cagayan will vacate the same upon demand. Hence, until such demand to
convinced Cepeda to allow the school to occupy the property for vacate was communicated by the respondents to the DepEd,
its school site that made it believe that the ownership of the respondents are not required to do any act to recover the subject
property was already transferred to it. We are not swayed by the land, precisely because they knew of the nature of the DepEd's
DepEd's arguments. As against the DepEd's unsubstantiated self- possession which is by mere tolerance. SDAaTC
Therefore, respondents are not guilty of failure or neglect to assert to oblige the one who built or planted to pay the price of the land,
a right within a reasonable time. The nature of that possession by and the one who sowed, the proper rent. However, the builder or
the DepEd has never changed from 1965 until the filing of the planter cannot be obliged to buy the land if its value is considerably
complaint for forcible entry against the respondents on June 21, more than that of the building or trees. In such case, he shall pay
2001. It was only then that the respondents had knowledge of the reasonable rent, if the owner of the land dues not choose to
adverse claim of the DepEd over the property. The respondents appropriate the building or trees after proper indemnity. The
filed the action for recovery of possession on March 16, 2004 after parties shall agree upon the terms of the lease and in
they lost their appeal in the forcible entry case and upon the case of disagreement, the court shall fix the terms thereof.
continued refusal of the DepEd to pay rent, purchase the lot or Article 546. Necessary expenses shall be refunded to every
vacate the premises. 45 possessor; but only the possessor in good faith may retain the
Lastly, the DepEd maintains that the respondents' inaction for thing until he has been reimbursed therefor.
more than 30 years reduced their right to recover the subject Useful expenses shall be refunded only to the possessor in good
property into a stale demand. It cited the case of Eduarte v. faith with the same right of retention, the person who has defeated
CA, 46 Catholic Bishop of Balanga v. CA, 47 Mactan-Cebu him in the possession having the option of refunding the
International Airport Authority (MCIAA) v. Heirs of Marcelina L. amount of the expenses or of paying the increase in value which
Sero, et al. 48 and DepEd Division of Albay v. Oate 49 to bolster the thing may have acquired by reason thereof.
its claim that a registered owner may lose his right to recover the In the case of Bernardo v. Bataclan, 53 the Court explicated that
possession of his registered property by reason of laches. It Article 448 provides a just and equitable solution to the
alleged that the fact that the respondents possess the impracticability of creating "forced co-ownership" by giving the
certificate of title of the property is of no moment since a owner of the land the option to acquire the improvements after
registered landowner, like the respondents, lost their right to payment of the proper indemnity or to oblige the builder or planter
recover the possession of the registered property by to pay for the land and the sower to pay the proper rent. 54 The
reason of laches. owner of the land is allowed to exercise the said options because
In the Eduarte case, the respondents therein knew of Eduarte's his right is older and because, by the principle of accession, he is
adverse possession of the subject lot as evidenced by their Joint entitled to the ownership of the accessory thing. 55
Affidavit dated March 18, 1959. In the case of Catholic Thus, the two options available to the respondents as landowners
Bishop of Balanga v. CA, the petitioner, by its own admission, was are: (a) they may appropriate the improvements, after
aware of private respondent's occupation in the payment of indemnity representing the value ofthe improvements
concept of owner of the lot donated in its behalf to private introduced and the necessary and useful expenses defrayed on
respondent's predecessor-in-interest in 1936. The subject lot in the subject lots; or (b) they may oblige the DepEd to pay the
the case of Mactan-Cebu International Airport Authority was price of the land. However, it is also provided under Article 448
obtained through expropriation proceedings and registered in the that the builder cannot be obliged to buy the land if its value is
name of the petitioner. In the Oate case, no evidence was considerably more than that of the improvements and buildings. If
presented to show that the respondent or his predecessor-in- that is the case, the DepEd is not duty-bound to pay the
interest protested against the adverse possession of the disputed price of the land should the value of the same be considerably
lot by the Municipality of Daraga and, subsequently, by the higher than the value of the improvement introduced by the DepEd
petitioner. on the subject property. In which case, the law provides that the
Unlike the cases cited by the DepEd, there was no solid parties shall agree on the terms of the lease and, in
evidentiary basis to establish that laches existed in the instant case of disagreement, the court shall fix the terms thereof.
case. The DepEd failed to substantiate its claim ofpossession in The RTC, as affirmed by the CA, ruled that the option of the
the concept of an owner from the time it occupied the lot after landowner to appropriate after payment of the indemnity
Cepeda allowed it to use the same for a school site in 1965. The representing the value of the improvements introduced and the
possession by the DepEd of the subject lot was clearly by mere necessary and useful expenses defrayed on the subject lots is no
tolerance, since it was not proven that it laid an adverse claim over longer feasible or convenient because it is now being used as
the property by virtue of the purported sale. school premises. Considering that the
Moreover, the trial court ruled that the DepEd is a builder in good appropriation of improvements upon payment of indemnity
faith. To be deemed a builder in good faith, it is essential that a pursuant to Article 546 by the respondents of the buildings being
person asserts title to the land on which he builds, i.e., that he be used by the school is no longer practicable and feasible, the
a possessor in the concept of owner, and that he be unaware that respondents are thus left with the second option of obliging the
there exists in his title or mode of acquisition any flaw which DepEd to pay the price of the land or to require the DepEd to pay
invalidates it. 50 However, there are cases where Article reasonable rent if the value ofthe land is considerably more than
448 of the Civil Code was applied beyond the recognized and the value of the buildings and improvements. acEHCD
limited definition of good faith, e.g., cases wherein the builder has Since the determination of the value of the subject property is
constructed improvements on the land of another with the factual in nature, this Court finds a need to remand the case to the
consent of the owner. 51 The Court ruled therein that the trial court to determine its value. In case the trial court determines
structures were built in good faith in those cases that the owners that the value of the land is considerably more than that of the
knew and approved of the construction of improvements on the buildings and improvements introduced, the DepEd may not be
property. 52 compelled to pay the value of the land, instead it shall pay
Despite being a possessor by mere tolerance, the DepEd is reasonable rent upon agreement by the parties of the terms of the
considered a builder in good faith, since Cepeda permitted the lease. In the event of a disagreement between the parties, the trial
construction of building and improvements to conduct classes on court shall fix the terms of lease.
his property. Hence, Article 448 may be applied in the case at bar. Lastly, the RTC ruled that the basis of due compensation for the
Article 448, in relation to Article 546 of the Civil Code,provides for respondents should he the price or value of the property at the
the rights of respondents as landowners as against the DepEd, a time of the taking. In the case of Ballatan v. CA, 56 the Court has
builder in good faith. The provisions respectively read: settled that the time of taking is determinative of just
Article 448. The owner of the land on which anything has been compensation in expropriation proceedings but not in a case
built, sown or planted in good faith, shall have the right to where a landowner has been deprived ofthe use of a
appropriate as his own the works, sowing, or planting, after portion of this land for years due to the
payment of the indemnity provided for in Articles 546 and 548, or encroachment of another. 57
In such instances, the case of Vda. de Roxas v. Our Lady's house and any other structure he may have built thereon, and
Foundation, Inc. 58 is instructive. The Court elucidated therein desist from entering the lot.
that the computation of the value of the property should be fixed at Petitioners subsequently filed on September 1, 1995 a
the prevailing market value. 59 The reckoning period for valuing complaint 10 for recovery of possession and damages with prayer
the property in case the landowner exercised his rights in for the issuance of a restraining order and preliminary injunction
accordance with Article 448 shall be at the time the landowner against spouses-respondents Miguel and Judith Castelltort before
elected his choice. 60 Therefore, the basis for the the RTC of Calamba, Laguna, docketed as Civil Case No. 2229-
computation of the value of the subject property in the instant case 95-C.
should be its present or current fair market value. To the complaint, the Castelltorts claimed in their Answer with
WHEREFORE, the Petition for Review on Certiorari, dated June Counterclaim 11 that they were builders in good faith.
18, 2010, of petitioner Department of Education, represented by Lina, represented by her son-attorney-in-fact Villegas, soon filed a
its Regional Director, is hereby DENIED.Accordingly, the Decision Motion for Intervention 12 before the RTC which was granted by
dated April 29, 2010 of the Court of Appeals in CA-G.R. CV No. Order 13 of December 19, 1995.
90633, affirming the Decision dated January 10, 2008 of the In her Answer to the complaint, 14 Lina alleged that the
Regional Trial Court ofTuguegarao City, Cagayan, Branch 5, Castelltorts acted in good faith in constructing the house on
which declared the respondents the owners of property in petitioners' lot as they in fact consulted her before commencing
controversy, is hereby AFFIRMED. any construction thereon, they having relied on the technical
Accordingly, this case is REMANDED to the court of origin to description of the lot sold to them, Lot 16, which was verified by
determine the value of the subject property. If the value of the her officially designated geodetic engineer.
property is less than the value of the buildings and improvements, Nevertheless, Lina proposed to give petitioners a lot containing an
the Department of Education is ordered to pay such amount. If the area of 536 square meters together with the house and duplex
value of the property is greater than the value of the buildings and structure built thereon or, if petitioners choose, to encumber the
improvements, the DepEd is ordered to pay reasonable rent in 536 square meter lot as collateral "to get immediate cash" through
accordance with the agreement of the parties. In a financing scheme in order to compensate them for the lot in
case of disagreement, the trial court shall fix the question. 15
amount of reasonable rent. Ruling out good faith, the RTC, by Decision of April 21, 1999, found
SO ORDERED. for petitioners in this wise:
||| (Department of Education v. Casibang, G.R. No. 192268, In the instant case, there is no well-founded belief of ownership by
[January 27, 2016]) the defendants of the land upon which they built their house. The
title or mode of acquisition upon which they based their belief of
ROSALES v. CASTELLTORT such ownership stemmed from a Contract to Sell (Exhibit "P") of
THIRD DIVISION which they were not even parties, the designated buyer being
[G.R. No. 157044. October 5, 2005.] Elizabeth Yson Cruz and the sale even subjected to the judicial
RODOLFO V. ROSALES, (represented by his heirs, Rodolfo, reconstitution of the title. And by their own actions, particularly
Jr., Romeo Allan, Lillian Rhodora, Roy Victor, Roger Lyle and defendant Miguel Castelltort, defendants betrayed this very belief
Alexander Nicolai, all surnamed Rosales) and LILY in their ownership when realizing the inutility of anchoring their
ROSQUETA-ROSALES, petitioners, vs. ownership on the basis of the Contract of Sale, defendant
MIGUEL CASTELLTORT, JUDITH CASTELLTORT, and LINA Miguel Castelltort in his testimony declared Elizabeth Yson Cruz
LOPEZ-VILLEGAS, assisted by her Attorney-in-Fact, Rene as his wife (tsn, pp. 7-8, March 24, 1998) despite an admission in
Villegas, respondents. their answer that they are the spouses named as defendants (tsn,
DECISION p. 8, January 12, 1998) and which declaration is an utter falsehood
CARPIO MORALES, J p: as the Contract to Sell itself indicates the civil status of said
The present petition for review on certiorari assails the October 2, Elizabeth Yson Cruz to be single.
2002 Decision 1 and February 6, 2003 Resolution 2 of the Court Even if we are to concede that defendants built their house in good
of Appeals (CA) in CA G.R. CV No. 64046 and seeks to reinstate faith on account of the representation of attorney-in-fact Rene
the April 21, 1999 Decision 3 of the Regional Trial Court (RTC) of Villegas, their failure to comply with the requirements of the
Calamba, Laguna, Branch 34 in Civil Case No. 2229-95-C. National Building Code, particularly the procurement of a building
Spouses-petitioners Rodolfo V. Rosales and Lily Rosqueta- permit, stained such good faith and belief.
Rosales (petitioners) are the registered owners of a parcel of land xxx xxx xxx
with an area of approximately 315 square meters, covered by From any and all indications, this deliberate breach is an
Transfer Certificate of Title (TCT) No. 36856 4 and designated as unmitigated manifestation of bad faith. And from the evidence thus
Lot 17, Block 1 of Subdivision Plan LRC Psd-55244 situated in Los adduced, we hold that defendants and the intervenor were
Baos, Laguna. equally guilty of negligence which led to the construction of the
On August 16, 1995, petitioners discovered that a house was defendants' house on plaintiffs' property and therefore jointly and
being constructed on their lot, without their knowledge and severally liable for all the damages suffered by the
consent, by respondent Miguel Castelltort (Castelltort). 5 plaintiffs. 16 (Underscoring supplied)
It turned out that respondents Castelltort and his wife Judith had The dispositive portion of the trial court's Decision reads,
purchased a lot, Lot 16 of the same Subdivision Plan, from quoted verbatim:
respondent Lina Lopez-Villegas (Lina) through her son-attorney- ACCORDINGLY, in view of all the foregoing, judgment is hereby
in-fact Rene Villegas (Villegas) but that after a survey thereof by rendered in favor of plaintiffs and against the defendants, ordering
geodetic engineer Augusto Rivera, he pointed to Lot 17 as the Lot the latter to surrender the possession of the property covered by
16 the Castelltorts purchased. TCT No. 36856 of the Register of Deeds of Laguna including any
Negotiations for the settlement of the case thus began, with and all improvements built thereon to the plaintiffs.
Villegas offering a larger lot near petitioners' lot in the same Defendants and intervenors are likewise jointly and severally
subdivision as a replacement thereof. 6 In the alternative, Villegas directed to pay to plaintiffs the following damages:
proposed to pay the purchase price of petitioners' lot with legal a) TWO THOUSAND (P2,000.00) PESOS per month from
interest. 7 Both proposals were, however, rejected by February 1995 by way of reasonable compensation for the use of
petitioners 8 whose counsel, by letter 9 of August 24, 1995, plaintiffs' property until the surrender of the same;
directed Castelltort to stop the construction of and demolish his
b) FIFTY THOUSAND (P50,000.00) PESOS by way of moral
damages; . . . A perusal of the records readily reveals that said court instead
c) THIRTY THOUSAND (P30,000.00) PESOS as exemplary relied on flimsy, if not immaterial, allegations of the appellees,
damages; which have no direct bearing in the determination of whether the
d) TWENTY THOUSAND (P20,000.00) PESOS as attorney's fees appellants are builders in bad faith.
and cost of suit. For one, the pivotal issue to be resolved in this case, i.e. whether
The counterclaim interposed by the defendants in their responsive appellant Miguel is a builder in good faith, was ignored by the court
pleading is hereby dismissed for lack of merit. a quo. The instant case does not in any way concern the personal
SO ORDERED. 17 and property relations of spouses-appellants and Elizabeth Yson
Respondents thereupon filed their respective appeals with the CA. Cruz which is an altogether different matter that can be ventilated
Petitioner Rodolfo Rosales, in the meantime, died on December 7, by the concerned parties through the institution of a proper action.
2001. His heirs Rodolfo, Jr., Romeo Allan, Lillian Rhodora, Roy . . . The court a quo should have focused on the issue of whether
Victor, Roger Lyle and Alexander Nicolai, all surnamed Rosales, appellant Miguel built, in good faith, the subject house without
filed their Appearance 18 as his substitute. notice of the adverse claim of the appellees and under the honest
By Decision of October 2, 2002, the CA granted the appeal and belief that the lot which he used in the construction belongs to him.
set aside the April 21, 1999 RTC Decision. The dispositive portion ...
of the Decision reads, quoted verbatim: . . . As it is, appellant Miguel relied on the title which the intervenor
WHEREFORE, premises considered, the instant appeal is showed to him which, significantly, has no annotation that would
hereby GRANTED and the assailed decision of the court a otherwise show a prior adverse claim. Thus, as far as appellant
quo REVERSED AND SET ASIDE. In accordance with the cases Miguel is concerned, his title over the subject lot, as well as the
of Technogas Philippines Manufacturing Corp. vs. Court of title of the intervenor thereto, is clean and untainted by an adverse
Appeals and Depra vs. Dumlao, applying Article 448 of the Civil claim or other irregularities.
Code, this case is REMANDED to the Regional Trial Court of For another, the appellants' failure to secure a building permit from
Calamba, Laguna, Branch 34, for further proceedings, as follows: the Municipal Engineer's Office on their construction on Lot 17
1. to determine the present fair price of appellees' 315 square does not impinge on the good faith of the appellants. In fact, it can
meter area of land and the amount of the expenses actually spent be told that a building permit was actually filed by appellant Miguel
by the appellants for building the house as of 21 August 1995, with respect to Lot 16 and it was only due to the confusion and
which is the time they were notified of appellees' rightful claim over misapprehension by the intervenor of the exact parameters of the
Lot 17. property which caused appellant's belief that Lot 17 [the
2. to order the appellees to exercise their option under the law questioned lot], is his. This fact bolsters appellant Miguel's good
(Article 448, Civil Code), whether to appropriate the house as their faith in building his house on appellees' lot under the mistaken
own by paying to the appellants the amount of the expenses spent belief that the same is his property. Otherwise, he should have
for the house as determined by the court a quo in accordance with secured a building permit on Lot 17 instead or should not have
the limitations as aforestated or to oblige the appellants to pay the bothered to take the necessary measures to obtain a building
price of the land. permit on Lot 16 in the first place.
In case the appellees exercise the option to oblige the appellants By and large, the records show that, as testified to by Engr.
to pay the price of the land but the latter reject such purchase Rebecca T. Lanuang, appellant Miguel had already applied for a
because, as found by the court, the value of the land is building permit as early as February 1994 and was in fact issued
considerably more than that of the house, the court shall order the a temporary building permit pending the completion of the
parties to agree upon the terms of a forced lease, and give the requirements for said permit. Although the building permit was
court a quo a formal written notice of such agreement and its belatedly issued in January 1996, this does not in any way detract
provisos. If no agreement is reached by the parties, the court a from appellant Miguel's good faith.
quo shall then fix the terms of the forced lease, provided that the xxx xxx xxx
monthly rental to be fixed by the Court shall not be less that Two In holding the appellants as builders in bad faith, the court a
Thousand Pesos (P2,000.00) per month, payable within the first quo defied law and settled jurisprudence considering that the
five (5) days of each calendar month and the period thereof shall factual basis of its findings and the incontrovertible evidence in
not be more than two (2) years, counted from the finality of the support thereof prove that the appellant Miguel, in good faith, built
judgment. the house on appellees' land without knowledge of an adverse
Upon the expiration of the forced lease, or upon default by the claim or any other irregularities that might cast a doubt as to the
appellants in the payment of rentals for two (2) consecutive veracity of the assurance given to him by the intervenor. Having
months, the appellees shall be entitled to terminate the forced been assured by the intervenor that the stone monuments were
lease, to recover their land, and to have the improvement removed purposely placed, albeit wrongfully, by the land surveyor in said
by the appellants at the latter's expense. The rentals herein land to specifically identify the lot and its inclusive boundaries, the
provided shall be tendered by the appellants to the court for appellants cannot be faulted for having relied on the expertise of
payment to the appellees, and such tender shall constitute the land surveyor who is more equipped and experienced in the
evidence of whether or not compliance was made within the period field of land surveying. Although under the Torrens system of land
fixed by the court. registration, the appellant is presumed to have knowledge of the
In any event, the appellants shall pay the appellees the amount of metes and bounds of the property with which he is dealing,
Two Thousand Pesos (P2,000.00) as reasonable compensation appellant however, considering that he is a layman not versed in
for their occupancy of the encroached property from the time said the technical description of his property, cannot be faulted in his
appellants' good faith cease (sic) to exist until such time the reliance on the survey plan that was delivered to him by the
possession of the property is delivered to the appellees subject to intervenor and the stone monuments that were placed in the
the reimbursement of the aforesaid expenses in favor of the encroached property.
appellants or until such time the payment of the purchase price of xxx xxx xxx
the said lot be made by the appellants in favor of the appellees in Peremptorily, contrary to the flawed pronouncements made by the
case the latter opt for the compulsory sale of the same. IaDSEA court a quo that appellant Miguel is deemed as a builder in bad
SO ORDERED. 19 (Emphasis in the original) faith on the basis of a mere assertion that he built his house without
In reversing the trial court, the CA held: initially satisfying himself that he owns the said property, this Court
xxx xxx xxx finds reason to maintain good faith on the part of the
appellant. Admittedly, the appellants' house erroneously allegations made by Ariosto SANTOS in his pleadings and in his
encroached on the property of the appellees due to a mistake in declarations in open Court differed will not militate against the
the placement of stone monuments as indicated in the survey plan, findings herein made nor support the reversal by respondent
which error is directly attributable to the fault of the geodetic Court. As a general rule, facts alleged in a party's pleading are
engineer who conducted the same. This fact alone negates bad deemed admissions of that party and binding upon it, but this is
faith on the part of appellant Miguel. not an absolute and inflexible rule. An Answer is a mere statement
xxx xxx xxx of fact which the party filing it expects to prove, but it is not
Moreover, it is quite illogical for appellant Miguel to knowingly build evidence. As Ariosto SANTOS himself, in open Court, had
his house on a property which he knew belongs to another person. repudiated the defenses he had raised in his Answer and against
... his own interest, his testimony is deserving of weight and
xxx xxx xxx credence. 26 (Underscoring supplied)
In view of the good faith of both parties in this case, their The issue determinative of the controversy in the case at bar
rights and obligations are to be governed by Article 448, hinges on whether Castelltort is a builder in good faith.
which has been applied to improvements or portions of A builder in good faith is one who builds with the belief that the
improvements built by mistaken belief on land belonging to land he is building on is his, or that by some title one has the right
the adjoining owner. . . . to build thereon, and is ignorant of any defect or flaw in his title. 27
xxx xxx xxx 20 (Emphasis and underscoring supplied) Article 527 of the Civil Code provides that good faith is always
Petitioners' Motion for Reconsideration 21 dated October 22, 2002 presumed, and upon him who alleges bad faith on the part of a
having been denied by the CA by Resolution of March 13, 2002, possessor rests the burden of proof. 28
the present petition was filed raising the following issues: In the case at bar, Lot 16 was sold by Lina, through her attorney-
I. in-fact Villegas, to Castelltort and a certain Elizabeth Cruz 29 for a
WHETHER OR NOT THE HONORABLE COURT OF APPEALS consideration of P500,000.00. While prior to the sale, what
COMMITTED A GRAVE ABUSE OF DISCRETION IN MAKING A Villegas showed Castelltort as evidence of his mother Lina's
FINDING THAT IS CONTRARY TO THE ADMISSIONS BY THE ownership of the property was only a photocopy of her title TCT
PARTIES No. (T-42171) T-18550 30 he explaining that the owner's duplicate
II. of the title was lost and that judicial reconstitution thereof was
WHETHER OR NOT THE HONORABLE COURT OF APPEALS ongoing, Castelltort acted in the manner of a prudent man and
COMMITTED A REVERSIBLE ERROR OF LAW IN went to the Registry of Deeds of Laguna to procure a certified true
CONCLUDING THAT THE TRIAL COURT, IN DECIDING THE copy of the TCT. 31 The certified true copy bore no annotation
CASE, RELIED ON FLIMSY, IF NOT IMMATERIAL, indicating any prior adverse claim on Lot 16. cEaSHC
ALLEGATIONS OF THE PETITIONERS, WHICH HAVE NO The records indicate that at the time Castelltort began
DIRECT BEARING IN THE DETERMINATION OF WHETHER constructing his house on petitioners' lot, he believed that it was
THE RESPONDENTS ARE BUILDERS IN GOOD FAITH the Lot 16 he bought and delivered to him by Villegas.
III. In his cross-examination, Villegas testified:
WHETHER OR NOT THE HONORABLE COURT OF APPEALS Q: You said the surveyor placed a mujon along boundary of the
COMMITTED A REVERSIBLE ERROR OF LAW IN RENDERING property?
A DECISION THAT IS UNENFORCEABLE AGAINST BOTH
RESPONDENT JUDITH CASTELLTORT AND THIRD-PARTY A: Yes.
ELIZABETH CRUZ 22 Q: When were the mujons placed in the boundary of the property?
Petitioners initially hammer against respondents' proving A: These mujons were the basis for my locating the property in
that Castelltort and a certain Elizabeth Cruz are the builders of the pointing to Mr. Castelltort.
house on the subject property, they faulting them with estoppel for xxx xxx xxx
alleging in their Answer before the trial court that "they Q: Is it not a fact that before Miguel Castelltort started constructing
(respondents Castelltort and Judith) caused the construction of that house he sought your advice or permission to construct the
their house which they bought from a certain Lina Lopez-Villegas." same over that particular lot?
Petitioners rely on the following doctrine established in Elayda v. A: Yes.
Court of Appeals: 23 Q: And you gave your consent?
"an admission made in the pleadings cannot be controverted by A: Yes, because based on my knowledge also that that was the
the party making such admission and are conclusive as to him and lot as pointed by Engr. Rivera.
that all proofs submitted by him contrary thereto or inconsistent xxx xxx xxx
therewith, should be ignored, whether objection is interposed by Q: Was there any remarkable difference between lot 16 and 17 at
the party or not . . ." the time that this particular lot was sold to Miguel Castelltort and
Petitioners' contention is hardly relevant to the case at bar. Elizabeth Cruz?
Whether it was Castelltort and Judith or Castelltort and Elizabeth xxx xxx xxx
Cruz who purchased the property from Lina is not material to the A: Both lots 16 and 17 are practically the same. The (sic) have the
outcome of the instant controversy. As found by the CA: same frontage. There is only a difference of 4 square meters, one
The fact remains that appellant [Castelltort] is the builder of the is 311 square meters and the other 315 square meters. Both sides
house on Lot 17 . . . The court a quo should have focused on the were fenced, as drawn they were facing the same road. They are
issue of whether appellant Miguel built, in good faith, the subject practically the same.
house without notice of the adverse claim of the appellees and Q: But at the time or immediately before Mr. Castelltort started the
under the honest belief that the lot which he used in the construction of the house, was there any remarkable distinction
construction belongs to him. . . . it cannot be gainsaid that between these two properties?
appellant Miguel has a title over the land that was purchased from A: None. 32 (Emphasis and underscoring supplied)
the intervenor . . . 24 The confusion in the identification of Lot 16 was eventually traced
At all events, as this Court held in the case of Gardner v. Court of to the error committed by geodetic engineer Augusto Rivera's
Appeals: 25 employees in placing stone monuments on petitioners' property,
In its Resolution reversing the original Decision, respondent Court instead of on Lot 16, the lot sold to Castelltort, based on the survey
discredited the testimony of Ariosto SANTOS for being at variance made by the engineer in 1992.
with the allegations in his Answer. The fact, however, that the The engineer so testified:
Q: Now, aside from inspecting personally the site, what else did could find the monuments on lines 1 and 4 and according to you
your men or assistants do? the reason is that a fence was already constructed?
A: After computing the subdivision lots, they went back to the field A: Yes, sir.
to plant those subdivision corners with concrete monuments. Q: For clarification, is this line 1 & 4 on Lot 16 a common line 1 &
Q: Which is (sic) also called as "mohons"? 4 on Lot 17?
A: Yes, sir. A: Yes, sir a common line.
Q: Now, can you point to this Honorable Court where exactly did Q: In other words, this line 1 & 4 devides (sic) Lot 16 & 17?
your men place these additional mohons and how many? A: Yes, sir.
A: Later on we discovered that they placed the mohons in the Q: So that when these monuments were placed on lines 1 & 4
adjoining lot, lot 17. somebody could mistake it for Lot 17 also because there were
xxx xxx xxx monuments now 1 & 4 for lot 16 since these are common lines for
Q: . . . when again did you meet Mr. Rene Villegas or after how Lot 17 also with Lot 16, it could also be construed that these are
many months or year? monuments for Lot 17?
A: Maybe after a year, sir. A: Yes, sir possible. 33 (Underscoring supplied)
Q: And you met him again because he had a problem regarding As correctly found by the CA, both parties having acted in good
the property of one Engr. Rosales? faith at least until August 21, 1995, the applicable provision in this
A: Yes, sir. case is Article 448 of the Civil Code which reads:
Q: And when he confided to you this matter, did you go to the site Art. 448. The owner of the land on which anything has been built,
of Lot 16 or 17? sown or planted in good faith, shall have the right to appropriate
A: Yes, sir. as his own the works, sowing or planting, after payment of the
Q: And what did you see there? indemnity provided for in Articles 546 and 548, or to oblige the one
A: A house being constructed then I rechecked the location of the who built or planted to pay the price of the land, and the one who
house and it turned out to be in Lot 17. sowed, the proper rent. However, the builder or planter cannot be
xxx xxx xxx obliged to buy the land if its value is considerably more than that
Q: Considering that you found out that a mistake was actually of the building or trees. In such case, he shall pay reasonable rent,
made by your assistants Dennis Orencio, Mario Carpio and if the owner of the land does not choose to appropriate the building
Sovejano when you allowed them to proceed on their own to make or trees after proper indemnity. The parties shall agree upon the
this computation, did you confront these men of yours afterwards? terms of the lease and in case of disagreement, the court shall fix
A: Yes, sir. the terms thereof.
Q: In what manner? Under the foregoing provision, the landowner can choose between
A: I actually reprimanded them verbally and also I dismissed Mario appropriating the building by paying the proper indemnity or
Carpio from my office. obliging the builder to pay the price of the land, unless its value is
xxx xxx xxx considerably more than that of the structures, in which case the
Q: And did you investigate how your men committed this mistake builder in good faith shall pay reasonable rent. 34 If the parties
of planting these monuments on another lot when corners 4 & 1 cannot come to terms over the conditions of the lease, the court
were clearly planted on the ground? must fix the terms thereof.
A: I myself rechecked it and found out that they committed an The choice belongs to the owner of the land, a rule that accords
error. with the principle of accession, i.e., that the accessory follows the
xxx xxx xxx principal and not the other way around. Even as the option lies with
Q: And now, you are saying that your men committed a mistake the landowner, the grant to him, nevertheless, is
by placing thereon monuments by planting these monuments not preclusive. 35 The landowner cannot refuse to exercise either
on Lot 16 but on Lot 17? option and compel instead the owner of the building to remove it
A: When I investigated how did they commit (sic) a mistake it came from the land. 36
to be like this. Before when we surveyed first this in 1992, at that The raison d'etre for this provision has been enunciated thus:
time Dante Villegas contracted my services there was a fence here Where the builder, planter or sower has acted in good faith, a
then when we went back, the road was already removed so they conflict of rights arises between the owners, and it becomes
committed an error that this point is Lot 19, they thought that it was necessary to protect the owner of the improvements without
Lot 19, the back portion. causing injustice to the owner of the land. In view of the
xxx xxx xxx impracticability of creating a state of forced co-ownership, the law
Q: In this particular case, did you find out how your men checked has provided a just solution by giving the owner of the land the
the succeeding lots, how they determine (sic) the exact location of option to acquire the improvements after payment of the proper
lot 16? indemnity, or to oblige the builder or planter to pay for the land and
A: They just relied on one side of the subdivision. the sower the proper rent. He cannot refuse to exercise either
Q: By just counting the number of lots? option. It is the owner of the land who is authorized to exercise the
A: Yes, sir. option, because his right is older, and because, by the principle of
Q: Without making any actual measurement? accession, he is entitled to the ownership of the accessory
A: They made an actual measurement but the reference point is thing. 37
not the one, the correct one because they also checked it with the Possession acquired in good faith does not lose this character
other corner of the road going back. except in the case and from the moment facts exist which show
xxx xxx xxx that the possessor is not unaware that he possesses the thing
Q: And how did they commit a mistake when you said they improperly or wrongfully. 38 The good faith ceases or is legally
checked the lot at the back of Lot 16? interrupted from the moment defects in the title are made known
A: Because they were quite confident since we had already to the possessor, by extraneous evidence or by suit for recovery
relocated the property two years ago so they thought that they get of the property by the true owner. 39
(sic) the right lot without checking the other side of the subdivision. In the case at bar, Castelltort's good faith ceased on August 21,
xxx xxx xxx 1995 when petitioners personally apprised him of their title over
Q: Now, you said that when you went to the place because you the questioned lot. As held by the CA, should petitioners then opt
heard from Rene Villegas that there was a mistake you no longer to appropriate the house, they should only be made to pay for that
part of the improvement built by Castelltort on the questioned
property at the time good faith still existed on his part or until represented by his heirs, namely: SERGIO T. TORBELA,
August 21, 1995. EUTROPIA T. VELASCO, PILAR T. ZULUETA, CANDIDO T.
The CA, however, failed to qualify that said part of the TORBELA, FLORENTINA T. TORBELA and PANTALEON T.
improvement should be pegged at its current fair market value TORBELA; DOLORES TORBELA TABLADA; LEONORA
consistent with this Court's pronouncement in Pecson v. Court of TORBELA AGUSTIN, represented by her heirs, namely:
Appeals. 40 PATRICIO, SEGUNDO, CONSUELO and FELIX, all surnamed
And, as correctly found by the CA, the commencement AGUSTIN; and SEVERINA TORBELA
of Castelltort's payment of reasonable rent should start on August ILDEFONSO,petitioners, vs. SPOUSES ANDRES T. ROSARIO
21, 1995 as well, to be paid until such time that the possession of and LENA DUQUE-ROSARIO and BANCO FILIPINO SAVINGS
the property is delivered to petitioners, subject to the AND MORTGAGE BANK, respondents.
reimbursement of expenses, that is, if such option is for petitioners [G.R. No. 140553. December 7, 2011.]
to appropriate the house. LENA DUQUE-ROSARIO, petitioner, vs. BANCO FILIPINO
This Court quotes the CA's ratiocination with approval: SAVINGS AND MORTGAGE BANK, respondent.
. . . Generally, Article 448 of the Civil Code provides that the DECISION
payment of reasonable rent should be made only up to the date LEONARDO-DE CASTRO, J p:
appellees serve notice of their option as provided by law upon the Presently before the Court are two consolidated Petitions for
appellants and the court a quo; that is, if such option is for Review on Certiorari under Rule 45 of the Rules of Court, both
appellees to appropriate the encroaching structure. In such event, assailing the Decision 1 dated June 29, 1999 and
appellants would have a right to retain the land on which they have Resolution 2 dated October 22, 1999 of the Court of Appeals in
built in good faith until they are reimbursed the expenses incurred CA-G.R. CV No. 39770.
by them. This is so because the right to retain the improvements The petitioners in G.R. No. 140528 are siblings Maria
while the corresponding indemnity is not paid implies the tenancy Torbela, 3 Pedro Torbela, 4 Eufrosina Torbela Rosario, 5 Leonila
or possession in fact of the land on which it is built, planted or Torbela Tamin, Fernando Torbela, 6 Dolores Torbela Tablada,
sown. Leonora Torbela Agustin, 7 and Severina Torbela Ildefonso
(Torbela siblings).
However, considering that appellants had ceased as builders in The petitioner in G.R. No. 140553 is Lena Duque-Rosario (Duque-
good faith at the time that appellant Miguel was notified of Rosario), who was married to, but now legally separated from, Dr.
appellees' lawful title over the disputed property, the payment of Andres T. Rosario (Dr. Rosario). Dr. Rosario is the son of
reasonable rent should accordingly commence at that time since Eufrosina Torbela Rosario and the nephew of the other Torbela
he can no longer avail of the rights provided under the law for siblings.
builders in good faith. 41 The controversy began with a parcel of land, with an area of 374
If the option chosen by petitioners is compulsory sale, however, square meters, located in Urdaneta City, Pangasinan (Lot No. 356-
the payment of rent should continue up to the actual transfer of A). It was originally part of a larger parcel of land, known as Lot
ownership. 42 No. 356 of the Cadastral Survey of Urdaneta, measuring 749
Respecting petitioners' argument that the appellate court erred in square meters, and covered by Original Certificate of Title (OCT)
rendering a decision that is "unenforceable against Judith who is No. 16676, 8 in the name of Valeriano Semilla (Valeriano), married
not the owner of the house and Elizabeth Cruz who was found to to Potenciana Acosta. Under unexplained circumstances,
be a part owner of the house built on their lot but is not a party to Valeriano gave Lot No. 356-A to his sister Marta Semilla, married
the case," the same does not lie. ISTHED to Eugenio Torbela (spouses Torbela). Upon the deaths of the
While one who is not a party to a proceeding shall not be affected spouses Torbela, Lot No. 356-A was adjudicated in equal shares
or bound 43 by a judgment rendered therein, 44 like Elizabeth among their children, the Torbela siblings, by virtue of a Deed of
Cruz, this does not detract from the validity and enforceability of Extrajudicial Partition 9 dated December 3, 1962.
the judgment on petitioners and respondents Castelltorts. On December 12, 1964, the Torbela siblings executed a Deed of
WHEREFORE, the petition is DENIED. The Decision dated Absolute Quitclaim 10 over Lot No. 356-A in favor of Dr. Rosario.
October 2, 2002 and Resolution dated February 6, 2003 of the According to the said Deed, the Torbela siblings "for and in
Court of Appeals are AFFIRMED with MODIFICATION such that consideration of the sum of NINE PESOS (P9.00) . . . transfer[red]
the trial court shall include for determination the increase in value and convey[ed] . . . unto the said Andres T. Rosario, that undivided
("plus value") which petitioners' 315 square meter lot may have portion of THREE HUNDRED SEVENTY-FOUR square meters of
acquired by reason of the existence of that portion of the house that parcel of land embraced in Original Certificate of Title No.
built before respondents Miguel and Judith Castelltort were 16676 of the land records of Pangasinan . . . ." 11 Four days later,
notified of petitioners' rightful claim on said lot, and the current fair on December 16, 1964, OCT No. 16676 in Valeriano's name was
market value of said portion. partially cancelled as to Lot No. 356-A and TCT No. 52751 12 was
SO ORDERED. issued in Dr. Rosario's name covering the said property.
||| (Rosales v. Castelltort, G.R. No. 157044, [October 5, 2005], 509 Another Deed of Absolute Quitclaim 13 was subsequently
PHIL 137-156) executed on December 28, 1964, this time by Dr. Rosario,
acknowledging that he only borrowed Lot No. 356-A from the
TORBELA v. ROSARIO Torbela siblings and was already returning the same to the latter
FIRST DIVISION for P1.00. The Deed stated: ECSHID
[G.R. No. 140528. December 7, 2011.] That for and in consideration of the sum of one peso (P1.00),
MARIA TORBELA, represented by her heirs, namely: Philippine Currency and the fact that I only borrowed the above
EULOGIO TOSINO, husband and children: CLARO, described parcel of land from MARIA TORBELA, married to
MAXIMINO, CORNELIO, OLIVIA and CALIXTA, all surnamed Eulogio Tosino, EUFROSINA TORBELA, married to Pedro
TOSINO, APOLONIA TOSINO VDA. DE RAMIREZ and JULITA Rosario, PEDRO TORBELA, married to Petra Pagador, LEONILA
TOSINO DEAN; PEDRO TORBELA, represented by his heirs, TORBELA, married to Fortunato Tamen, FERNANDO TORBELA,
namely: JOSE and DIONISIO, both surnamed TORBELA; married to Victoriana Tablada, DOLORES TORBELA, widow,
EUFROSINA TORBELA ROSARIO, represented by her heirs, LEONORA TORBELA, married to Matias Agustin and SEVERINA
namely: ESTEBAN T. ROSARIO, MANUEL T. ROSARIO, TORBELA, married to Jorge Ildefonso, . . . by these presents do
ROMULO T. ROSARIO and ANDREA ROSARIO-HADUCA; hereby cede, transfer and convey by way of this ABSOLUTE
LEONILA TORBELA TAMIN; FERNANDO TORBELA, QUITCLAIM unto the said Maria, Eufrosina, Pedro, Leonila,
Fernando, Dolores, Leonora and Severina, all surnamed Torbela No. 356-A was annotated on TCT No. 52751 on March 6, 1981
the parcel of land described above. 14 (Emphasis ours.) as Entry No. 520099. 22
The aforequoted Deed was notarized, but was not immediately Five days later, on March 11, 1981, another annotation, Entry No.
annotated on TCT No. 52751. 520469, 23 was made on TCT No. 52751, canceling the adverse
Following the issuance of TCT No. 52751, Dr. Rosario obtained a claim on Lot No. 356-A under Entry Nos. 274471-274472, on the
loan from the Development Bank of the Philippines (DBP) on basis of the Cancellation and Discharge of Mortgage executed by
February 21, 1965 in the sum of P70,200.00, secured by a Dr. Rosario on March 5, 1981. Entry No. 520469 consisted of both
mortgage constituted on Lot No. 356-A. The mortgage was stamped and handwritten portions, and exactly reads:
annotated on TCT No. 52751 on September 21, 1965 as Entry Entry No. 520469. Cancellation of Adverse Claim executed
No. 243537. 15 Dr. Rosario used the proceeds of the loan for the by Andres Rosario in favor of same. The incumbrance/mortgage
construction of improvements on Lot No. 356-A. appearing under Entry No. 274471-72 is now cancelled as per
On May 16, 1967, Cornelio T. Tosino (Cornelio) executed an Cancellation and Discharge of Mortgage Ratified before Notary
Affidavit of Adverse Claim, 16 on behalf of the Torbela siblings. Public Mauro G. Meris on March 5, 1981: Doc. No. 215; Page
Cornelio deposed in said Affidavit: No. 44; Book No. 1; Series of 1981.
3. That ANDRES T. ROSARIO later quitclaimed his rights in favor Lingayen, Pangasinan, 3-11, 19981 n
of the former owners by virtue of a Deed of Absolute Quitclaim [Signed: Pedro dela Cruz]
which he executed before Notary Public Banaga, and entered in Register of Deeds 24
his Notarial Registry as Dec. No. 43; Page No. 9; Book No. I; On December 8, 1981, Dr. Rosario and his wife, Duque-Rosario
Series of 1964; (spouses Rosario), acquired a third loan in the amount of
4. That it is the desire of the parties, my aforestated kins, to P1,200,000.00 from Banco Filipino Savings and Mortgage Bank
register ownership over the above-described property or to perfect (Banco Filipino). To secure said loan, the spouses Rosario again
their title over the same but their Deed could not be registered constituted mortgages on Lot No. 356-A, Lot No. 4489, and Lot
because the registered owner now, ANDRES T. ROSARIO No. 5-F-8-C-2-B-2-A. The mortgage on Lot No. 356-A was
mortgaged the property with the DEVELOPMENT BANK OF THE annotated on TCT No. 52751 as Entry No. 533283 25 on
PHILIPPINES, on September 21, 1965, and for which reason, the December 18, 1981. Since the construction of a two-storey
Title is still impounded and held by the said bank; commercial building on Lot No. 5-F-8-C-2-B-2-A was still
5. That pending payment of the obligation with the incomplete, the loan value thereof as collateral was deducted from
DEVELOPMENT BANK OF THE PHILIPPINES or redemption of the approved loan amount. Thus, the spouses Rosario could only
the Title from said bank, I, CORNELIO T. TOSINO, in behalf of my avail of the maximum loan amount of P830,064.00 from Banco
mother MARIA TORBELA-TOSINO, and my Aunts EUFROSINA Filipino.
TORBELA, LEONILA TORBELA-TAMEN, DOLORES TORBELA, Because Banco Filipino paid the balance of Dr. Rosario's loan from
LEONORA TORBELA-AGUSTIN, SEVERINA TORBELA- PNB, the mortgage on Lot No. 356-A in favor of PNB was
ILDEFONSO, and my Uncles PEDRO TORBELA and cancelled per Entry No. 533478 26 on TCT No. 52751 dated
FERNANDO, also surnamed TORBELA, I request the Register of December 23, 1981.
Deeds of Pangasinan to annotate their adverse claim at the back On February 13, 1986, the Torbela siblings filed before the
of Transfer Certificate of Title No. 52751, based on the annexed Regional Trial Court (RTC) of Urdaneta, Pangasinan, a Complaint
document, Deed of Absolute Quitclaim by ANDRES T. ROSARIO, for recovery of ownership and possession of Lot No. 356-A, plus
dated December 28, 1964, marked as Annex "A" and made a part damages, against the spouses Rosario, which was docketed
of this Affidavit, and it is also requested that the DEVELOPMENT as Civil Case No. U-4359. On the same day, Entry Nos. 593493
BANK OF THE PHILIPPINES be informed accordingly. 17 and 593494 were made on TCT No. 52751 that read as follows:
The very next day, on May 17, 1967, the Torbela siblings had Entry No. 593494 Complaint Civil Case No. U-4359 (For:
Cornelio's Affidavit of Adverse Claim dated May 16, 1967 and Dr. Recovery of Ownership and Possession and Damages. (Sup.
Rosario's Deed of Absolute Quitclaim dated December 28, 1964 Paper).
annotated on TCT No. 52751 as Entry Nos. Entry No. 593493 Notice of Lis Pendens The parcel of land
274471 18 and 274472, 19 respectively. described in this title is subject to Lis Pendens executed by Liliosa
The construction of a four-storey building on Lot No. 356-A was B. Rosario, CLAO, Trial Attorney dated February 13, 1986. Filed
eventually completed. The building was initially used as a hospital, to TCT No. 52751 February 13, 1986-1986 February 13 3:30
but was later converted to a commercial building. Part of the p.m.
building was leased to PT&T; and the rest to Mrs. Andrea Rosario- (SGD.) PACIFICO M. BRAGANZA
Haduca, Dr. Rosario's sister, who operated the Rose Inn Hotel and Register of Deeds 27
Restaurant. The spouses Rosario afterwards failed to pay their loan from
Dr. Rosario was able to fully pay his loan from DBP. Under Entry Banco Filipino. As of April 2, 1987, the spouses Rosario's
No. 520197 on TCT No. 52751 20 dated March 6, 1981, the outstanding principal obligation and penalty charges amounted to
mortgage appearing under Entry No. 243537 was cancelled per P743,296.82 and P151,524.00, respectively. 28
the Cancellation and Discharge of Mortgage executed by DBP in Banco Filipino extrajudicially foreclosed the mortgages on Lot No.
favor of Dr. Rosario and ratified before a notary public on July 11, 356-A, Lot No. 4489, and Lot No. 5-F-8-C-2-B-2-A. During the
1980. cDCHaS public auction on April 2, 1987, Banco Filipino was the lone bidder
In the meantime, Dr. Rosario acquired another loan from the for the three foreclosed properties for the price of P1,372,387.04.
Philippine National Bank (PNB) sometime in 1979-1981. Records The Certificate of Sale 29 dated April 2, 1987, in favor of Banco
do not reveal though the original amount of the loan from PNB, but Filipino, was annotated on TCT No. 52751 on April 14, 1987
the loan agreement was amended on March 5, 1981 and the loan as Entry No. 610623. 30
amount was increased to P450,000.00. The loan was secured by On December 9, 1987, the Torbela siblings filed before the RTC
mortgages constituted on the following properties: (1) Lot No. 356- their Amended Complaint, 31 impleading Banco Filipino as
A, covered by TCT No. 52751 in Dr. Rosario's name; (2) Lot No. additional defendant in Civil Case No. U-4359 and praying that the
4489, with an area of 1,862 square meters, located in Dagupan spouses Rosario be ordered to redeem Lot No. 356-A from Banco
City, Pangasinan, covered by TCT No. 24832; and (3) Lot No. 5- Filipino. cSIADH
F-8-C-2-B-2-A, with an area of 1,001 square meters, located in The spouses Rosario instituted before the RTC on March 4, 1988
Nancayasan, Urdaneta, Pangasinan, covered by TCT No. a case for annulment of extrajudicial foreclosure and damages,
104189. 21 The amended loan agreement and mortgage on Lot with prayer for a writ of preliminary injunction and temporary
restraining order, against Banco Filipino, the Provincial Ex 8. Dr. Rosario and Lena Rosario are hereby ordered to reimburse
Officio Sheriff and his Deputy, and the Register of Deeds of [the Torbela siblings] the market value of Lot 356-A as of
Pangasinan. The case was docketed as Civil Case No. U-4667. December, 1964 minus payments made by the former;
Another notice of lis pendens was annotated on TCT No. 52751 9. Dismissing the complaint of [the Torbela siblings] against Banco
on March 10, 1988 as Entry No. 627059, viz.: Filipino, Pedro Habon and Rufino Moreno in Civil Case No. U-
Entry No. 627059 Lis Pendens Dr. Andres T. Rosario and 4733; and against Banco Filipino in Civil Case No. U-4359. 39
Lena Duque Rosario, Plaintiff versus Banco Filipino, et al. Civil The RTC released an Amended Decision 40 dated January 29,
Case No. U-4667 or Annulment of Extrajudicial Foreclosure of 1992, adding the following paragraph to the dispositive:
Real Estate Mortgage The parcel of land described in this title Banco Filipino is entitled to a Writ of Possession over Lot-5-F-8-C-
is subject to Notice of Lis Pendens subscribed and sworn to before 2-[B]-2-A of the subdivision plan (LRC) Psd-122471, covered by
Notary Public Mauro G. Meris, as Doc. No. 21; Page No. 5; Book Transfer Certificate of Title 104189 of the Registry of Deeds of
111; S-1988. March 7, 1988-1988 * March 10, 1:00 p.m. Pangasinan[.] 41
(SGD.) RUFINO M. MORENO, SR. The Torbela siblings and Dr. Rosario appealed the foregoing RTC
Register of Deeds 32 judgment before the Court of Appeals. Their appeal was docketed
The Torbela siblings intervened in Civil Case No. U-4667. as CA-G.R. CV No. 39770.
Eventually, on October 17, 1990, the RTC issued an In its Decision 42 dated June 29, 1999, the Court of Appeals
Order 33 dismissing without prejudice Civil Case No. U-4667 due decreed:
to the spouses Rosario's failure to prosecute. WHEREFORE, foregoing considered, the appealed decision is
Meanwhile, the Torbela siblings tried to redeem Lot No. 356-A hereby AFFIRMED with modification. Items Nos. 6 and 7 of the
from Banco Filipino, but their efforts were unsuccessful. Upon the appealed decision are DELETED. Item No. 8 is modified requiring
expiration of the one-year redemption period in April 1988, the [Dr. Rosario] to pay [the Torbela siblings] actual damages, in the
Certificate of Final Sale 34 and Affidavit of amount of P1,200,000.00 with 6% per annum interest from finality
Consolidation 35 covering all three foreclosed properties were of this decision until fully paid. [Dr. Rosario] is
executed on May 24, 1988 and May 25, 1988, respectively. further ORDERED to pay [the Torbela siblings] the amount of
On June 7, 1988, new certificates of title were issued in the name P300,000.00 as moral damages; P200,000.00 as exemplary
of Banco Filipino, particularly, TCT No. 165812 for Lot No. 5-F-8- damages and P100,000.00 as attorney's fees.
C-2-B-2-A and TCT No. 165813 for Lot No. 356-A. 36 Costs against [Dr. Rosario]. 43
The Torbela siblings thereafter filed before the RTC on August 29, The Court of Appeals, in a Resolution 44 dated October 22, 1999,
1988 a Complaint 37 for annulment of the Certificate of Final Sale denied the separate Motions for Reconsideration of the Torbela
dated May 24, 1988, judicial cancellation of TCT No. 165813, and siblings and Dr. Rosario.
damages, against Banco Filipino, the Ex Officio Provincial Sheriff, The Torbela siblings come before this Court via the Petition for
and the Register of Deeds of Pangasinan, which was docketed Review in G.R. No. 140528, with the following assignment of
as Civil Case No. U-4733. errors:
On June 19, 1991, Banco Filipino filed before the RTC of Urdaneta First Issue and Assignment of Error:
City a Petition for the issuance of a writ of possession. In said THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN
Petition, docketed as Pet. Case No. U-822, Banco Filipino prayed NOT FINDING THAT THE REGISTRATION OF THE DEED OF
that a writ of possession be issued in its favor over Lot No. 5-F-8- ABSOLUTE QUITCLAIM EXECUTED BY [DR. ANDRES T.
C-2-B-2-A and Lot No. 356-A, plus the improvements thereon, and ROSARIO] IN FAVOR OF THE [TORBELA SIBLINGS] DATED
the spouses Rosario and other persons presently in possession of DECEMBER 28, 1964 AND THE REGISTRATION OF THE
said properties be directed to abide by said writ. NOTICE OF ADVERSE CLAIM EXECUTED BY THE [TORBELA
The RTC jointly heard Civil Case Nos. U-4359 and U-4733 and SIBLINGS], SERVE AS THE OPERATIVE ACT TO CONVEY OR
Pet. Case No. U-822. The Decision 38 on these three cases was AFFECT THE LAND AND IMPROVEMENTS THEREOF IN SO
promulgated on January 15, 1992, the dispositive portion of which FAR AS THIRD PERSONS ARE CONCERNED.
reads: Second Issue and Assignment of Error:
WHEREFORE, judgment is rendered: THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN
1. Declaring the real estate mortgage over Lot 356-A covered by FINDING THAT THE SUBJECT PROPERTY COVERED BY
TCT 52751 executed by Spouses Andres Rosario in favor of T.C.T. NO. 52751 IS CLEAN AND FREE, DESPITE OF THE
Banco Filipino, legal and valid; ANNOTATION OF ENCUMBRANCES OF THE NOTICE OF
2. Declaring the sheriff's sale dated April 2, 1987 over Lot 356-A ADVERSE CLAIM AND THE DEED OF ABSOLUTE QUITCLAIM
covered by TCT 52751 and subsequent final Deed of Sale dated APPEARING AT THE BACK THEREOF AS ENTRY NOS. 274471
May 14, 1988 over Lot 356-A covered by TCT No. 52751 legal and AND 274472, RESPECTIVELY.
valid; Third Issue and Assignment of Error:
3. Declaring Banco Filipino the owner of Lot 356-A covered by THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN
TCT No. 52751 (now TCT 165813); FINDING THAT THE NOTICE OF ADVERSE CLAIM OF THE
4. Banco Filipino is entitled to a Writ of Possession over Lot 356- [TORBELA SIBLINGS] UNDER ENTRY NO. 274471 WAS
A together with the improvements thereon (Rose Inn Building). VALIDLY CANCELLED BY THE REGISTER OF DEEDS, IN THE
The Branch Clerk of Court is hereby ordered to issue a writ of ABSENCE OF A PETITION DULY FILED IN COURT FOR ITS
possession in favor of Banco Filipino; CANCELLATION.
5. [The Torbela siblings] are hereby ordered to render accounting Fourth Issue and Assignment of Error:
to Banco Filipino the rental they received from tenants of Rose Inn THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN
Building from May 14, 1988; FINDING THAT RESPONDENT BANCO FILIPINO SAVINGS
6. [The Torbela siblings] are hereby ordered to pay Banco Filipino AND MORTGAGE BANK IS A MORTGAGEE IN GOOD
the sum of P20,000.00 as attorney's fees; FAITH. CaTcSA
7. Banco Filipino is hereby ordered to give [the Torbela siblings] Fifth Issue and Assignment of Error:
the right of first refusal over Lot 356-A. The Register of Deeds is THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN
hereby ordered to annotate the right of [the Torbela siblings] at the NOT FINDING THAT THE FILING OF A CIVIL CASE NO. U-4359
back of TCT No. 165813 after payment of the required ON DECEMBER 9, 1987, IMPLEADING RESPONDENT BANCO
fees; cCSEaA FILIPINO AS ADDITIONAL PARTY DEFENDANT, TOLL OR
SUSPEND THE RUNNING OF THE ONE YEAR PERIOD OF same is contrary to the admissions of both parties; (7) when the
REDEMPTION. findings of the Court of Appeals are contrary to those of the trial
Sixth Issue and Assignment of Error: court; (8) when the findings of fact are conclusions without citation
THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN of specific evidence on which they are based; (9) when the Court
NOT FINDING THAT THE OWNERSHIP OVER THE SUBJECT of Appeals manifestly overlooked certain relevant facts not
PROPERTY WAS PREMATURELY CONSOLIDATED IN FAVOR disputed by the parties and which, if properly considered, would
OF RESPONDENT BANCO FILIPINO SAVINGS AND justify a different conclusion; and (10) when the findings of fact of
MORTGAGE BANK. the Court of Appeals are premised on the absence of evidence
Seventh Issue and Assignment of Error: and are contradicted by the evidence on record. 49
THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN As the succeeding discussion will bear out, the first, fourth, and
FINDING THAT THE SUBJECT PROPERTY IS AT LEAST ninth exceptions are extant in these case.
WORTH P1,200,000.00. 45 Barangay conciliation was not a
The Torbela siblings ask of this Court: pre-requisite to the institution of Civil
WHEREFORE, in the light of the foregoing considerations, the Case No. U-4359.
[Torbela siblings] most respectfully pray that the questioned Dr. Rosario contends that Civil Case No. U-4359, the Complaint of
DECISION promulgated on June 29, 1999 (Annex "A", Petition) the Torbela siblings for recovery of ownership and possession of
and the RESOLUTION dated October 22, 1999 (Annex "B", Lot No. 356-A, plus damages, should have been dismissed by the
Petition) be REVERSED and SET ASIDE, and/or further RTC because of the failure of the Torbela siblings to comply with
MODIFIED in favor of the [Torbela siblings], and another the prior requirement of submitting the dispute
DECISION issue ordering, among other reliefs, the respondent to barangay conciliation.
Banco Filipino to reconvey back Lot No. 356-A, covered by T.C.T. The Torbela siblings instituted Civil Case No. U-4359 on February
No. 52751, in favor of the [Torbela siblings] who are the actual 13, 1986, when Presidential Decree No. 1508, Establishing a
owners of the same. System of Amicably Settling Disputes at the Barangay Level, was
The [Torbela siblings] likewise pray for such other reliefs and still in effect. 50 Pertinent provisions of said issuance read:
further remedies as may be deemed just and equitable under the Section 2. Subject matters for amicable settlement.
premises. 46 The Lupon of each barangay shall have authority to bring together
Duque-Rosario, now legally separated from Dr. Rosario, avers in the parties actually residing in the same city or
her Petition for Review in G.R. No. 140553 that Lot No. 4489 and municipality for amicable settlement of all disputes except:
Lot No. 5-F-8-C-2-B-2-A were registered in her name, and she was 1. Where one party is the government, or any subdivision or
unlawfully deprived of ownership of said properties because of the instrumentality thereof;
following errors of the Court of Appeals: 2. Where one party is a public officer or employee, and the dispute
A relates to the performance of his official functions;
THE HON. COURT OF APPEALS PATENTLY ERRED IN NOT 3. Offenses punishable by imprisonment exceeding 30 days, or a
FINDING THAT THE PERIOD TO REDEEM THE PROPERTY fine exceeding P200.00;
HAS NOT COMMENCED, HENCE, THE CERTIFICATE OF 4. Offenses where there is no private offended party;
SALE, THE CONSOLIDATION OF OWNERSHIP BY [BANCO 5. Such other classes of disputes which the Prime Minister may in
FILIPINO], ARE NULL AND VOID. the interest of justice determine upon recommendation of the
B Minister of Justice and the Minister of Local Government.
THE COURT OF APPEALS PATENTLY ERRED IN REFUSING Section 3. Venue. Disputes between or among persons
TO RULE THAT THE FILING OF THE COMPLAINT BEFORE actually residing in the same barangay shall be brought for
THE COURT A QUO BY THE [TORBELA SIBLINGS] HAD amicable settlement before the Lupon of said barangay.Those
ALREADY BEEN PRESCRIBED. 47 involving actual residents of different barangays within the same
Duque-Rosario prays that the appealed decision of the Court of city or municipality shall be brought in the barangay where the
Appeals be reversed and set aside, and that Lot No. 4489 and Lot respondent or any of the respondents actually resides, at the
No. 5-F-8-C-2-B-2-A be freed from all obligations and election of the complainant. However, all disputes which
encumbrances and returned to her. involved real property or any interest therein shall be brought
Review of findings of fact by the in the barangay where the real property or any part thereof is
RTC and the Court of Appeals situated.
warranted. The Lupon shall have no authority over disputes:
A disquisition of the issues raised and/or errors assigned in the 1. involving parties who actually reside in barangays of
Petitions at bar unavoidably requires a re-evaluation of the facts different cities or municipalities, except where
and evidence presented by the parties in the court a quo. such barangays adjoin each other; and
In Republic v. Heirs of Julia Ramos, 48 the Court summed up the 2. involving real property located in different municipalities.
rules governing the power of review of the Court: xxx xxx xxx
Ordinarily, this Court will not review, much less reverse, the factual Section 6. Conciliation, pre-condition to filing of complaint. No
findings of the Court of Appeals, especially where such findings complaint, petition, action or proceeding involving any matter
coincide with those of the trial court. The findings of facts of the within the authority of the Lupon as provided in Section 2 hereof
Court of Appeals are, as a general rule, conclusive and binding shall be filed or instituted in court or any other government office
upon this Court, since this Court is not a trier of facts and does not for adjudication unless there has been a confrontation of the
routinely undertake the re-examination of the evidence presented parties before the Lupon Chairman or the Pangkat and no
by the contending parties during the trial of the case. TESDcA conciliation or settlement has been reached as certified by the
The above rule, however, is subject to a number of exceptions, Lupon Secretary or the Pangkat Secretary, attested by
such as (1) when the inference made is manifestly mistaken, the Lupon or Pangkat Chairman, or unless the settlement has
absurd or impossible; (2) when there is grave abuse of discretion; been repudiated. . . . . (Emphases supplied.) TASCEc
(3) when the finding is grounded entirely on speculations, The Court gave the following elucidation on the jurisdiction of
surmises, or conjectures; (4) when the judgment of the Court of the Lupong Tagapayapa in Tavora v. Hon. Veloso: 51
Appeals is based on misapprehension of facts; (5) when the The foregoing provisions are quite clear. Section 2 specifies the
findings of fact are conflicting; (6) when the Court of Appeals, in conditions under which the Lupon of a barangay "shall have
making its findings, went beyond the issues of the case and the authority" to bring together the disputants for amicable settlement
of their dispute: The parties must be "actually residing in the No. 52751, covering Lot No. 356-A, was already issued in Dr.
same city or municipality." At the same time, Section 3 while Rosario's name. On December 28, 1964, Dr. Rosario executed
reiterating that the disputants must be "actually residing in the his own Deed of Absolute Quitclaim, in which he expressly
same barangay" or in "different barangays" within the same city or acknowledged that he "only borrowed" Lot No. 356-A and was
municipality unequivocably declares that the Lupon shall have transferring and conveying the same back to the Torbela siblings
"no authority" over disputes "involving parties who actually reside for the consideration of P1.00. On February 21, 1965, Dr.
in barangays of different cities or municipalities," except where Rosario's loan in the amount of P70,200.00, secured by a
such barangays adjoin each other. mortgage on Lot No. 356-A, was approved by DBP. Soon
Thus, by express statutory inclusion and exclusion, thereafter, construction of a hospital building started on Lot No.
the Lupon shall have no jurisdiction over disputes where the 356-A. DIESHT
parties are not actual residents of the same city or Among the notable evidence presented by the Torbela siblings is
municipality, except where the barangays in which they the testimony of Atty. Lorenza Alcantara (Atty. Alcantara), who had
actually reside adjoin each other. no apparent personal interest in the present case. Atty. Alcantara,
It is true that immediately after specifying when she was still a boarder at the house of Eufrosina Torbela
the barangay whose Lupon shall take cognizance of a given Rosario (Dr. Rosario's mother), was consulted by the Torbela
dispute, Sec. 3 of PD 1508 adds: siblings as regards the extrajudicial partition of Lot No. 356-A. She
"However, all disputes which involve real property or any interest also witnessed the execution of the two Deeds of Absolute
therein shall be brought in the barangay where the real property or Quitclaim by the Torbela siblings and Dr. Rosario.
any part thereof is situated." In contrast, Dr. Rosario presented TCT No. 52751, issued in his
Actually, however, this added sentence is just an name, to prove his purported title to Lot No. 356-A. In Lee Tek
ordinary proviso and should operate as such. Sheng v. Court of Appeals, 53 the Court made a clear distinction
The operation of a proviso, as a rule, should be limited to its normal between title and the certificate of title:
function, which is to restrict or vary the operation of the principal The certificate referred to is that document issued by the Register
clause, rather than expand its scope, in the absence of a clear of Deeds known as the Transfer Certificate of Title (TCT). By title,
indication to the contrary. the law refers to ownership which is represented by that document.
"The natural and appropriate office of a proviso is . . . to except Petitioner apparently confuses certificate with title. Placing a
something from the enacting clause; to limit, restrict, or qualify the parcel of land under the mantle of the Torrens system does not
statute in whole or in part; or to exclude from the scope of the mean that ownership thereof can no longer be disputed.
statute that which otherwise would be within its terms." (73 Am Jur Ownership is different from a certificate of title. The TCT is only
2d 467.) the best proof of ownership of a piece of land. Besides, the
Therefore, the quoted proviso should simply be deemed to restrict certificate cannot always be considered as conclusive evidence of
or vary the rule on venue prescribed in the principal clauses of the ownership. Mere issuance of the certificate of title in the name
first paragraph of Section 3, thus: Although venue is generally of any person does not foreclose the possibility that the real
determined by the residence of the parties, disputes involving property may be under co-ownership with persons not named
real property shall be brought in the barangay where the real in the certificate or that the registrant may only be a trustee
property or any part thereof is situated, notwithstanding that or that other parties may have acquired interest subsequent
the parties reside elsewhere within the same to the issuance of the certificate of title. To repeat, registration
city/municipality. 52 (Emphases supplied.) is not the equivalent of title, but is only the best evidence
The original parties in Civil Case No. U-4359 (the Torbela siblings thereof. Title as a concept of ownership should not be
and the spouses Rosario) do not reside in the same barangay, or confused with the certificate of title as evidence of such
in different barangays within the same city or municipality, or in ownership although both are interchangeably used. . . .
different barangays of different cities or municipalities but are . 54 (Emphases supplied.)
adjoining each other. Some of them reside outside Pangasinan Registration does not vest title; it is merely the evidence of such
and even outside of the country altogether. The Torbela siblings title. Land registration laws do not give the holder any better title
reside separately in Barangay Macalong, Urdaneta, Pangasinan; than what he actually has. 55Consequently, Dr. Rosario must still
Barangay Consolacion, Urdaneta, Pangasinan; Pangil, Laguna; prove herein his acquisition of title to Lot No. 356-A, apart from his
Chicago, United States of America; and Canada. The spouses submission of TCT No. 52751 in his name.
Rosario are residents of Calle Garcia, Poblacion, Urdaneta, Dr. Rosario testified that he obtained Lot No. 356-A after paying
Pangasinan. Resultantly, the Lupon had no jurisdiction over the the Torbela siblings P25,000.00, pursuant to a verbal agreement
dispute and barangay conciliation was not a pre-condition for the with the latter. The Court though observes that Dr. Rosario's
filing of Civil Case No. U-4359. testimony on the execution and existence of the verbal agreement
The Court now looks into the merits of Civil Case No. U-4359. with the Torbela siblings lacks significant details (such as the
There was an express trust between names of the parties present, dates, places, etc.) and is not
the Torbela siblings and Dr. Rosario. corroborated by independent evidence.
There is no dispute that the Torbela sibling inherited the title to Lot In addition, Dr. Rosario acknowledged the execution of the two
No. 356-A from their parents, the Torbela spouses, who, in turn, Deeds of Absolute Quitclaim dated December 12, 1964 and
acquired the same from the first registered owner of Lot No. 356- December 28, 1964, even affirming his own signature on the latter
A, Valeriano. Deed. The Parol Evidence Rule provides that when the terms of
Indeed, the Torbela siblings executed a Deed of Absolute the agreement have been reduced into writing, it is considered as
Quitclaim on December 12, 1964 in which they transferred and containing all the terms agreed upon and there can be, between
conveyed Lot No. 356-A to Dr. Rosario for the consideration of the parties and their successors in interest, no evidence of such
P9.00. However, the Torbela siblings explained that they only terms other than the contents of the written agreement. 56 Dr.
executed the Deed as an accommodation so that Dr. Rosario Rosario may not modify, explain, or add to the terms in the two
could have Lot No. 356-A registered in his name and use said written Deeds of Absolute Quitclaim since he did not put in issue
property to secure a loan from DBP, the proceeds of which would in his pleadings (1) an intrinsic ambiguity, mistake, or imperfection
be used for building a hospital on Lot No. 356-A a claim in the Deeds; (2) failure of the Deeds to express the true intent and
supported by testimonial and documentary evidence, and borne the agreement of the parties thereto; (3) the validity of the Deeds;
out by the sequence of events immediately following the execution or (4) the existence of other terms agreed to by the Torbela siblings
by the Torbela siblings of said Deed. On December 16, 1964, TCT and Dr. Rosario after the execution of the Deeds. 57
Even if the Court considers Dr. Rosario's testimony on his alleged transformed the nature of the trust to an express one. The express
verbal agreement with the Torbela siblings, the Court finds the trust continued despite Dr. Rosario stating in his Deed of Absolute
same unsatisfactory. Dr. Rosario averred that the two Deeds were Quitclaim that he was already returning Lot No. 356-A to the
executed only because he was "planning to secure loan from the Torbela siblings as Lot No. 356-A remained registered in Dr.
Development Bank of the Philippines and Philippine National Bank Rosario's name under TCT No. 52751 and Dr. Rosario kept
and the bank needed absolute quitclaim[.]" 58 While Dr. Rosario's possession of said property, together with the improvements
explanation makes sense for the first Deed of Absolute Quitclaim thereon.
dated December 12, 1964 executed by the Torbela siblings (which The right of the Torbela siblings to
transferred Lot No. 356-A to Dr. Rosario for P9.00.00), the same recover Lot No. 356-A has not yet
could not be said for the second Deed of Absolute Quitclaim dated prescribed.
December 28, 1964 executed by Dr. Rosario. In fact, Dr. Rosario's The Court extensively discussed the prescriptive period for
Deed of Absolute Quitclaim (in which he admitted that he only express trusts in the Heirs of Maximo Labanon v. Heirs of
borrowed Lot No. 356-A and was transferring the same to the Constancio Labanon, 65 to wit:
Torbela siblings for P1.00.00) would actually work against the On the issue of prescription, we had the opportunity to rule
approval of Dr. Rosario's loan by the banks. Since Dr. Rosario's in Bueno v. Reyes that unrepudiated written express trusts are
Deed of Absolute Quitclaim dated December 28, 1964 is a imprescriptible:
declaration against his self-interest, it must be taken as favoring "While there are some decisions which hold that an action upon a
the truthfulness of the contents of said Deed. 59 HIEASa trust is imprescriptible, without distinguishing between express
It can also be said that Dr. Rosario is estopped from claiming or and implied trusts, the better rule, as laid down by this Court in
asserting ownership over Lot No. 356-A based on his Deed of other decisions, is that prescription does supervene where the
Absolute Quitclaim dated December 28, 1964. Dr. Rosario's trust is merely an implied one. The reason has been expressed by
admission in the said Deed that he merely borrowed Lot No. 356- Justice J.B.L. Reyes in J.M. Tuason and Co., Inc. vs.
A is deemed conclusive upon him. Under Article 1431 of the Civil Magdangal, 4 SCRA 84, 88, as follows: 2005jur
Code, "[t]hrough estoppel an admission or representation is Under Section 40 of the old Code of Civil Procedure, all actions for
rendered conclusive upon the person making it, and cannot be recovery of real property prescribed in 10 years, excepting only
denied or disproved as against the person relying actions based on continuing or subsisting trusts that were
thereon." 60 That admission cannot now be denied by Dr. Rosario considered by section 38 as imprescriptible. As held in the case
as against the Torbela siblings, the latter having relied upon his of Diaz v. Gorricho, L-11229, March 29, 1958, however, the
representation. continuing or subsisting trusts contemplated in section 38 of the
Considering the foregoing, the Court agrees with the RTC and the Code of Civil Procedure referred only to express unrepudiated
Court of Appeals that Dr. Rosario only holds Lot No. 356-A in trust trusts, and did not include constructive trusts (that are imposed by
for the Torbela siblings. law) where no fiduciary relation exists and the trustee does not
Trust is the right to the beneficial enjoyment of property, the legal recognize the trust at all."
title to which is vested in another. It is a fiduciary relationship that This principle was amplified in Escay v. Court of Appeals this way:
obliges the trustee to deal with the property for the benefit of the "Express trusts prescribe 10 years from the repudiation of the trust
beneficiary. Trust relations between parties may either be express (Manuel Diaz, et al. vs. Carmen Gorricho et al., 54 O.G. p. 8429,
or implied. An express trust is created by the intention of the trustor Sec. 40, Code of Civil Procedure)."
or of the parties, while an implied trust comes into being by In the more recent case of Secuya v. De Selma, we again ruled
operation of law. 61 that the prescriptive period for the enforcement of an express trust
Express trusts are created by direct and positive acts of the of ten (10) years starts upon the repudiation of the trust by the
parties, by some writing or deed, or will, or by words either trustee. 66
expressly or impliedly evincing an intention to create a trust. Under To apply the 10-year prescriptive period, which would bar a
Article 1444 of the Civil Code, "[n]o particular words are required beneficiary's action to recover in an express trust, the repudiation
for the creation of an express trust, it being sufficient that a trust is of the trust must be proven by clear and convincing evidence and
clearly intended." 62 It is possible to create a trust without using made known to the beneficiary. 67 The express trust disables the
the word "trust" or "trustee." Conversely, the mere fact that these trustee from acquiring for his own benefit the property committed
words are used does not necessarily indicate an intention to create to his management or custody, at least while he does not openly
a trust. The question in each case is whether the trustor repudiate the trust, and makes such repudiation known to the
manifested an intention to create the kind of relationship which to beneficiary or cestui que trust. For this reason, the old Code of
lawyers is known as trust. It is immaterial whether or not he knows Civil Procedure (Act 190) declared that the rules on adverse
that the relationship which he intends to create is called a trust, possession do not apply to "continuing and subsisting" (i.e.,
and whether or not he knows the precise characteristics of the unrepudiated) trusts. In an express trust, the delay of the
relationship which is called a trust. 63 beneficiary is directly attributable to the trustee who undertakes to
In Tamayo v. Callejo, 64 the Court recognized that a trust may hold the property for the former, or who is linked to the beneficiary
have a constructive or implied nature in the beginning, but the by confidential or fiduciary relations. The trustee's possession is,
registered owner's subsequent express acknowledgement in a therefore, not adverse to the beneficiary, until and unless the latter
public document of a previous sale of the property to another party, is made aware that the trust has been repudiated. 68
had the effect of imparting to the aforementioned trust the nature Dr. Rosario argues that he is deemed to have repudiated the trust
of an express trust. The same situation exists in this case. When on December 16, 1964, when he registered Lot No. 356-A in his
Dr. Rosario was able to register Lot No. 356-A in his name under name under TCT No. 52751, so when on February 13, 1986, the
TCT No. 52751 on December 16, 1964, an implied trust was Torbela siblings instituted before the RTC Civil Case No. U-4359,
initially established between him and the Torbela siblings under for the recovery of ownership and possession of Lot No. 356-A
Article 1451 of the Civil Code, which provides: from the spouses Rosario, over 21 years had passed. Civil Case
ART. 1451. When land passes by succession to any person and No. U-4359 was already barred by prescription, as well as laches.
he causes the legal title to be put in the name of another, a trust is The Court already rejected a similar argument in Ringor v.
established by implication of law for the benefit of the true owner. Ringor 69 for the following reasons:
Dr. Rosario's execution of the Deed of Absolute Quitclaim on A trustee who obtains a Torrens title over a property held in
December 28, 1964, containing his express admission that he only trust for him by another cannot repudiate the trust by relying
borrowed Lot No. 356-A from the Torbela siblings, eventually on the registration. A Torrens Certificate of Title in Jose's name
did not vest ownership of the land upon him. The Torrens system cannot be used as the reckoning date for the start of the
does not create or vest title. It only confirms and records title prescriptive period.
already existing and vested. It does not protect a usurper from the The Torbela siblings can only be charged with knowledge of the
true owner. The Torrens system was not intended to foment mortgage of Lot No. 356-A to PNB on March 6, 1981 when the
betrayal in the performance of a trust. It does not permit one to amended loan and mortgage agreement was registered on TCT
enrich himself at the expense of another. Where one does not No. 52751 as Entry No. 520099. Entry No. 520099 is constructive
have a rightful claim to the property, the Torrens system of notice to the whole world 74 that Lot No. 356-A was mortgaged by
registration can confirm or record nothing. Petitioners cannot rely Dr. Rosario to PNB as security for a loan, the amount of which was
on the registration of the lands in Jose's name nor in the name of increased to P450,000.00. Hence, Dr. Rosario is deemed to have
the Heirs of Jose M. Ringor, Inc., for the wrong result they seek. effectively repudiated the express trust between him and the
For Jose could not repudiate a trust by relying on a Torrens title he Torbela siblings on March 6, 1981, on which day, the prescriptive
held in trust for his co-heirs. The beneficiaries are entitled to period for the enforcement of the express trust by the Torbela
enforce the trust, notwithstanding the irrevocability of the Torrens siblings began to run.
title. The intended trust must be sustained. 70 (Emphasis From March 6, 1981, when the amended loan and mortgage
supplied.) agreement was registered on TCT No. 52751, to February 13,
In the more recent case of Heirs of Tranquilino Labiste v. Heirs of 1986, when the Torbela siblings instituted before the RTC Civil
Jose Labiste, 71 the Court refused to apply prescription and Case No. U-4359 against the spouses Rosario, only about five
laches and reiterated that: years had passed. The Torbela siblings were able to institute Civil
[P]rescription and laches will run only from the time the express Case No. U-4359 well before the lapse of the 10-year prescriptive
trust is repudiated. The Court has held that for acquisitive period for the enforcement of their express trust with Dr. Rosario.
prescription to bar the action of the beneficiary against the trustee Civil Case No. U-4359 is likewise not barred by laches. Laches
in an express trust for the recovery of the property held in trust it means the failure or neglect, for an unreasonable and unexplained
must be shown that: (a) the trustee has performed unequivocal length of time, to do that which by exercising due diligence could
acts of repudiation amounting to an ouster of the cestui que or should have been done earlier. It is negligence or omission to
trust; (b) such positive acts of repudiation have been made known assert a right within a reasonable time, warranting a presumption
to the cestui que trust, and (c) the evidence thereon is clear and that the party entitled to assert it either has abandoned it or
conclusive. Respondents cannot rely on the fact that the declined to assert it. As the Court explained in the preceding
Torrens title was issued in the name of Epifanio and the other paragraphs, the Torbela siblings instituted Civil Case No. U-4359
heirs of Jose. It has been held that a trustee who obtains a five years after Dr. Rosario's repudiation of the express trust, still
Torrens title over property held in trust by him for another within the 10-year prescriptive period for enforcement of such
cannot repudiate the trust by relying on the registration. The trusts. This does not constitute an unreasonable delay in asserting
rule requires a clear repudiation of the trust duly communicated to one's right. A delay within the prescriptive period is sanctioned by
the beneficiary. The only act that can be construed as repudiation law and is not considered to be a delay that would bar relief.
was when respondents filed the petition for reconstitution in Laches apply only in the absence of a statutory prescriptive
October 1993. And since petitioners filed their complaint in period. 75
January 1995, their cause of action has not yet prescribed, laches Banco Filipino is not a mortgagee
cannot be attributed to them. 72 (Emphasis supplied.) CEaDAc and buyer in good faith.
It is clear that under the foregoing jurisprudence, the registration Having determined that the Torbela siblings are the true owners
of Lot No. 356-A by Dr. Rosario in his name under TCT No. 52751 and Dr. Rosario merely the trustee of Lot No. 356-A, the Court is
on December 16, 1964 is not the repudiation that would have next faced with the issue of whether or not the Torbela siblings
caused the 10-year prescriptive period for the enforcement of an may still recover Lot No. 356-A considering that Dr. Rosario had
express trust to run. already mortgaged Lot No. 356-A to Banco Filipino, and upon Dr.
The Court of Appeals held that Dr. Rosario repudiated the express Rosario's default on his loan obligations, Banco Filipino foreclosed
trust when he acquired another loan from PNB and constituted a the mortgage, acquired Lot No. 356-A as the highest bidder at the
second mortgage on Lot No. 356-A sometime in 1979, which, foreclosure sale, and consolidated title in its name under TCT No.
unlike the first mortgage to DBP in 1965, was without the 165813. The resolution of this issue depends on the answer to the
knowledge and/or consent of the Torbela siblings. question of whether or not Banco Filipino was a mortgagee in good
The Court only concurs in part with the Court of Appeals on this faith. CHTAIc
matter. Under Article 2085 of the Civil Code, one of the essential
For repudiation of an express trust to be effective, the unequivocal requisites of the contract of mortgage is that the mortgagor should
act of repudiation had to be made known to the Torbela siblings be the absolute owner of the property to be mortgaged; otherwise,
as the cestuis que trust and must be proven by clear and the mortgage is considered null and void. However, an exception
conclusive evidence. A scrutiny of TCT No. 52751 reveals the to this rule is the doctrine of "mortgagee in good faith." Under this
following inscription: doctrine, even if the mortgagor is not the owner of the mortgaged
Entry No. 520099 property, the mortgage contract and any foreclosure sale arising
Amendment of the mortgage in favor of PNB inscribed under Entry therefrom are given effect by reason of public policy. This principle
No. 490658 in the sense that the consideration thereof has been is based on the rule that all persons dealing with property covered
increased to PHILIPPINE PESOS Four Hundred Fifty Thousand by a Torrens Certificate of Title, as buyers or mortgagees, are not
Pesos only (P450,000.00) and to secure any and all negotiations required to go beyond what appears on the face of the title. This is
with PNB, whether contracted before, during or after the date of the same rule that underlies the principle of "innocent purchasers
this instrument, acknowledged before Notary Public for value." The prevailing jurisprudence is that a mortgagee has a
of Pangasinan Alejo M. Dato as Doc. No. 198, Page No. 41, Book right to rely in good faith on the certificate of title of the mortgagor
No. 11, Series of 1985. to the property given as security and in the absence of any sign
Date of Instrument March 5, 1981 that might arouse suspicion, has no obligation to undertake further
Date of Inscription March 6, 1981 73 investigation. Hence, even if the mortgagor is not the rightful owner
Although according to Entry No. 520099, the original loan and of, or does not have a valid title to, the mortgaged property, the
mortgage agreement of Lot No. 356-A between Dr. Rosario and mortgagee in good faith is, nonetheless, entitled to protection. 76
PNB was previously inscribed as Entry No. 490658, Entry No. On one hand, the Torbela siblings aver that Banco Filipino is not a
490658 does not actually appear on TCT No. 52751 and, thus, it mortgagee in good faith because as early as May 17, 1967, they
had already annotated Cornelio's Adverse Claim dated May 16, registrations should be considered unnecessary or superfluous, it
1967 and Dr. Rosario's Deed of Absolute Quitclaim dated would be the notice of lis pendens and not the annotation of the
December 28, 1964 on TCT No. 52751 as Entry Nos. 274471- adverse claim which is more permanent and cannot be cancelled
274472, respectively. without adequate hearing and proper disposition of the claim."
On the other hand, Banco Filipino asseverates that it is a With the enactment of the Property Registration Decree on June
mortgagee in good faith because per Section 70 of Presidential 11, 1978, Section 70 thereof now applies to adverse claims:
Decree No. 1529, otherwise known as the Property Registration SEC. 70. Adverse claim. Whoever claims any part or interest in
Decree, the notice of adverse claim, registered on May 17, 1967 registered land adverse to the registered owner, arising
by the Torbela siblings under Entry Nos. 274471-274472 on TCT subsequent to the date of the original registrations, may, if no other
No. 52751, already lapsed after 30 days or on June 16, 1967. provision is made in this Decree for registering the same, make a
Additionally, there was an express cancellation of Entry Nos. statement in writing setting forth fully his alleged right, or interest,
274471-274472 by Entry No. 520469 dated March 11, 1981. So and how or under whom acquired, a reference to the number of
when Banco Filipino approved Dr. Rosario's loan for the certificate of title of the registered owner, the name of the
P1,200,000.00 and constituted a mortgage on Lot No. 356-A registered owner, and a description of the land in which the right
(together with two other properties) on December 8, 1981, the only or interest is claimed.
other encumbrance on TCT No. 52751 was Entry No. 520099 The statement shall be signed and sworn to, and shall state the
dated March 6, 1981, i.e., the amended loan and mortgage adverse claimant's residence, and a place at which all notices may
agreement between Dr. Rosario and PNB (which was eventually be served upon him. This statement shall be entitled to registration
cancelled after it was paid off with part of the proceeds from Dr. as an adverse claim on the certificate of title. The adverse claim
Rosario's loan from Banco Filipino). Hence, Banco Filipino was not shall be effective for a period of thirty days from the date of
aware that the Torbela siblings' adverse claim on Lot No. 356-A registration. After the lapse of said period, the annotation of
still subsisted. adverse claim may be cancelled upon filing of a verified
The Court finds that Banco Filipino is not a mortgagee in good petition therefor by the party in interest: Provided, however,
faith. Entry Nos. 274471-274472 were not validly cancelled, and that after cancellation, no second adverse claim based on the
the improper cancellation should have been apparent to Banco same ground shall be registered by the same claimant.
Filipino and aroused suspicion in said bank of some defect in Dr. Before the lapse of thirty days aforesaid, any party in interest
Rosario's title. may file a petition in the Court of First Instance where the land
The purpose of annotating the adverse claim on the title of the is situated for the cancellation of the adverse claim, and the
disputed land is to apprise third persons that there is a controversy court shall grant a speedy hearing upon the question of the
over the ownership of the land and to preserve and protect the validity of such adverse claim, and shall render judgment as
right of the adverse claimant during the pendency of the may be just and equitable. If the adverse claim is adjudged to be
controversy. It is a notice to third persons that any transaction invalid, the registration thereof shall be ordered cancelled. If, in
regarding the disputed land is subject to the outcome of the any case, the court, after notice and hearing, shall find that the
dispute. 77 adverse claim thus registered was frivolous, it may fine the
Adverse claims were previously governed by Section 110 of Act claimant in an amount not less than one thousand pesos nor more
No. 496, otherwise known as the Land Registration Act, quoted in than five thousand pesos, in its discretion. Before the lapse of thirty
full below: days, the claimant may withdraw his adverse claim by filing with
ADVERSE CLAIM the Register of Deeds a sworn petition to that effect. (Emphases
SEC. 110. Whoever claims any part or interest in registered land supplied.)
adverse to the registered owner, arising subsequent to the date of In Sajonas v. Court of Appeals, 79 the Court squarely interpreted
the original registration, may, if no other provision is made in this Section 70 of the Property Registration Decree, particularly, the
Act for registering the same, make a statement in writing setting new 30-day period not previously found in Section 110 of the Land
forth fully his alleged right or interest, and how or under whom Registration Act, thus:
acquired, and a reference to the volume and page of the certificate In construing the law aforesaid, care should be taken that every
of title of the registered owner, and a description of the land in part thereof be given effect and a construction that could render a
which the right or interest is claimed. provision inoperative should be avoided, and inconsistent
The statement shall be signed and sworn to, and shall state the provisions should be reconciled whenever possible as parts of a
adverse claimant's residence, and designate a place at which all harmonious whole. For taken in solitude, a word or phrase might
notices may be served upon him. This statement shall be entitled easily convey a meaning quite different from the one actually
to registration as an adverse claim, and the court, upon a petition intended and evident when a word or phrase is considered with
of any party in interest, shall grant a speedy hearing upon the those with which it is associated. In ascertaining the period of
question of the validity of such adverse claim and shall enter such effectivity of an inscription of adverse claim, we must read the law
decree therein as justice and equity may require. If the claim is in its entirety. Sentence three, paragraph two of Section 70 of P.D.
adjudged to be invalid, the registration shall be cancelled. If in any 1529 provides:
case the court after notice and hearing shall find that a claim thus "The adverse claim shall be effective for a period of thirty days
registered was frivolous or vexatious, it may tax the adverse from the date of registration."
claimant double or treble costs in its discretion. AIHDcC At first blush, the provision in question would seem to restrict the
Construing the aforequoted provision, the Court stressed in Ty Sin effectivity of the adverse claim to thirty days. But the above
Tei v. Lee Dy Piao 78 that "[t]he validity or efficaciousness of the provision cannot and should not be treated separately, but should
[adverse] claim . . . may only be determined by the Court upon be read in relation to the sentence following, which reads:
petition by an interested party, in which event, the Court shall order "After the lapse of said period, the annotation of adverse claim may
the immediate hearing thereof and make the proper adjudication be cancelled upon filing of a verified petition therefor by the party
as justice and equity may warrant. And it is ONLY when such claim in interest." IDSETA
is found unmeritorious that the registration thereof may be If the rationale of the law was for the adverse claim to ipso
cancelled." The Court likewise pointed out in the same case that facto lose force and effect after the lapse of thirty days, then it
while a notice of lis pendens may be cancelled in a number of would not have been necessary to include the foregoing caveat to
ways, "the same is not true in a registered adverse claim, for it may clarify and complete the rule. For then, no adverse claim need be
be cancelled only in one instance, i.e., after the claim is adjudged cancelled. If it has been automatically terminated by mere lapse of
invalid or unmeritorious by the Court . . . ;" and "if any of the
time, the law would not have required the party in interest to do a and the RTC conducts a hearing and determines the said claim to
useless act. be invalid or unmeritorious.
A statute's clauses and phrases must not be taken separately, but No petition for cancellation has been filed and no hearing has been
in its relation to the statute's totality. Each statute must, in fact, be conducted herein to determine the validity or merit of the adverse
construed as to harmonize it with the pre-existing body of laws. claim of the Torbela siblings. Entry No. 520469 cancelled the
Unless clearly repugnant, provisions of statutes must be adverse claim of the Torbela siblings, annotated as Entry Nos.
reconciled. The printed pages of the published Act, its history, 274471-774472, upon the presentation by Dr. Rosario of a mere
origin, and its purposes may be examined by the courts in their Cancellation and Discharge of Mortgage. CDHcaS
construction. . . . . Regardless of whether or not the Register of Deeds should have
xxx xxx xxx inscribed Entry No. 520469 on TCT No. 52751, Banco Filipino
Construing the provision as a whole would reconcile the apparent could not invoke said inscription in support of its claim of good
inconsistency between the portions of the law such that the faith. There were several things amiss in Entry No. 520469 which
provision on cancellation of adverse claim by verified petition should have already aroused suspicions in Banco Filipino, and
would serve to qualify the provision on the effectivity period. The compelled the bank to look beyond TCT No. 52751 and inquire
law, taken together, simply means that the cancellation of the into Dr. Rosario's title. First, Entry No. 520469 does not mention
adverse claim is still necessary to render it ineffective, any court order as basis for the cancellation of the adverse claim.
otherwise, the inscription will remain annotated and shall Second, the adverse claim was not a mortgage which could be
continue as a lien upon the property. For if the adverse claim cancelled with Dr. Rosario's Cancellation and Discharge of
has already ceased to be effective upon the lapse of said Mortgage. And third, the adverse claim was against Dr. Rosario,
period, its cancellation is no longer necessary and the yet it was cancelled based on a document also executed by Dr.
process of cancellation would be a useless ceremony. Rosario.
It should be noted that the law employs the phrase "may be It is a well-settled rule that a purchaser or mortgagee cannot close
cancelled," which obviously indicates, as inherent in its decision his eyes to facts which should put a reasonable man upon his
making power, that the court may or may not order the cancellation guard, and then claim that he acted in good faith under the belief
of an adverse claim, notwithstanding such provision limiting the that there was no defect in the title of the vendor or mortgagor. His
effectivity of an adverse claim for thirty days from the date of mere refusal to believe that such defect exists, or his willful closing
registration. The court cannot be bound by such period as it would of his eyes to the possibility of the existence of a defect in the
be inconsistent with the very authority vested in it. A fortiori, the vendor's or mortgagor's title, will not make him an innocent
limitation on the period of effectivity is immaterial in determining purchaser or mortgagee for value, if it afterwards develops that the
the validity or invalidity of an adverse claim which is the principal title was in fact defective, and it appears that he had such notice
issue to be decided in the court hearing. It will therefore depend of the defects as would have led to its discovery had he acted with
upon the evidence at a proper hearing for the court to determine the measure of precaution which may be required of a prudent
whether it will order the cancellation of the adverse claim or not. man in a like situation. 81
To interpret the effectivity period of the adverse claim as absolute While the defective cancellation of Entry Nos. 274471-274472 by
and without qualification limited to thirty days defeats the very Entry No. 520469 might not be evident to a private individual, the
purpose for which the statute provides for the remedy of an same should have been apparent to Banco Filipino. Banco Filipino
inscription of adverse claim, as the annotation of an adverse claim is not an ordinary mortgagee, but is a mortgagee-bank, whose
is a measure designed to protect the interest of a person over a business is impressed with public interest. In fact, in one
piece of real property where the registration of such interest or case, 82 the Court explicitly declared that the rule that persons
right is not otherwise provided for by the Land Registration Act or dealing with registered lands can rely solely on the certificate of
Act 496 (now P.D. 1529 or the Property Registration Decree), and title does not apply to banks. In another case, 83 the Court
serves as a warning to third parties dealing with said property that adjudged that unlike private individuals, a bank is expected to
someone is claiming an interest or the same or a better right than exercise greater care and prudence in its dealings, including those
the registered owner thereof. involving registered lands. A banking institution is expected to
The reason why the law provides for a hearing where the exercise due diligence before entering into a mortgage contract.
validity of the adverse claim is to be threshed out is to afford The ascertainment of the status or condition of a property offered
the adverse claimant an opportunity to be heard, providing a to it as security for a loan must be a standard and indispensable
venue where the propriety of his claimed interest can be part of its operations.
established or revoked, all for the purpose of determining at Banco Filipino cannot be deemed a mortgagee in good faith, much
last the existence of any encumbrance on the title arising less a purchaser in good faith at the foreclosure sale of Lot No.
from such adverse claim. This is in line with the provision 356-A. Hence, the right of the Torbela siblings over Lot No. 356-A
immediately following: is superior over that of Banco Filipino; and as the true owners of
"Provided, however, that after cancellation, no second adverse Lot No. 356-A, the Torbela siblings are entitled to a reconveyance
claim shall be registered by the same claimant." of said property even from Banco Filipino.
Should the adverse claimant fail to sustain his interest in the Nonetheless, the failure of Banco Filipino to comply with the due
property, the adverse claimant will be precluded from registering a diligence requirement was not the result of a dishonest purpose,
second adverse claim based on the same ground. some moral obliquity, or breach of a known duty for some interest
It was held that "validity or efficaciousness of the claim may only or ill will that partakes of fraud that would justify damages. 84
be determined by the Court upon petition by an interested party, Given the reconveyance of Lot No. 356-A to the Torbela siblings,
in which event, the Court shall order the immediate hearing thereof there is no more need to address issues concerning redemption,
and make the proper adjudication as justice and equity may annulment of the foreclosure sale and certificate of sale (subject
warrant. And it is only when such claim is found unmeritorious that matter of Civil Case No. U-4733), or issuance of a writ of
the registration of the adverse claim may be cancelled, thereby possession in favor of Banco Filipino (subject matter of Pet. Case
protecting the interest of the adverse claimant and giving notice No. U-822) insofar as Lot No. 356-A is concerned. Such would
and warning to third parties." 80 (Emphases supplied.) only be superfluous. Banco Filipino, however, is not left without
Whether under Section 110 of the Land Registration Act or any recourse should the foreclosure and sale of the two other
Section 70 of the Property Registration Decree, notice of adverse mortgaged properties be insufficient to cover Dr. Rosario's loan,
claim can only be cancelled after a party in interest files a petition for the bank may still bring a proper suit against Dr. Rosario to
for cancellation before the RTC wherein the property is located, collect the unpaid balance.
The rules on accession shall govern co-ownership," the law has provided a just and equitable solution
the improvements on Lot No. 356-A by giving the owner of the land the option to acquire the
and the rents thereof. improvements after payment of the proper indemnity or to oblige
The accessory follows the principal. The right of accession is the builder or planter to pay for the land and the sower to pay the
recognized under Article 440 of the Civil Code which states that proper rent. It is the owner of the land who is allowed to exercise
"[t]he ownership of property gives the right by accession to the option because his right is older and because, by the principle
everything which is produced thereby, or which is incorporated or of accession, he is entitled to the ownership of the accessory
attached thereto, either naturally or artificially." thing. 85
There is no question that Dr. Rosario is the builder of the The landowner has to make a choice between appropriating the
improvements on Lot No. 356-A. The Torbela siblings themselves building by paying the proper indemnity or obliging the builder to
alleged that they allowed Dr. Rosario to register Lot No. 356-A in pay the price of the land. But even as the option lies with the
his name so he could obtain a loan from DBP, using said parcel of landowner, the grant to him, nevertheless, is preclusive. He must
land as security; and with the proceeds of the loan, Dr. Rosario choose one. He cannot, for instance, compel the owner of the
had a building constructed on Lot No. 356-A, initially used as a building to remove the building from the land without first
hospital, and then later for other commercial purposes. Dr. Rosario exercising either option. It is only if the owner chooses to sell his
supervised the construction of the building, which began in 1965; land, and the builder or planter fails to purchase it where its value
fully liquidated the loan from DBP; and maintained and is not more than the value of the improvements, that the owner
administered the building, as well as collected the rental income may remove the improvements from the land. The owner is entitled
therefrom, until the Torbela siblings instituted Civil Case No. U- to such remotion only when, after having chosen to sell his land,
4359 before the RTC on February 13, 1986. TACEDI the other party fails to pay for the same. 86
When it comes to the improvements on Lot No. 356-A, both the This case then must be remanded to the RTC for the determination
Torbela siblings (as landowners) and Dr. Rosario (as builder) are of matters necessary for the proper application of Article 448, in
deemed in bad faith. The Torbela siblings were aware of the relation to Article 546, of the Civil Code.Such matters include the
construction of a building by Dr. Rosario on Lot No. 356-A, while option that the Torbela siblings will choose; the amount of
Dr. Rosario proceeded with the said construction despite his indemnity that they will pay if they decide to appropriate the
knowledge that Lot No. 356-A belonged to the Torbela siblings. improvements on Lot No. 356-A; the value of Lot No. 356-A if they
This is the case contemplated under Article 453 of the Civil Code, prefer to sell it to Dr. Rosario; or the reasonable rent if they opt to
which reads: sell Lot No. 356-A to Dr. Rosario but the value of the land is
ART. 453. If there was bad faith, not only on the part of the person considerably more than the improvements. The determination
who built, planted or sowed on the land of another, but also on the made by the Court of Appeals in its Decision dated June 29, 1999
part of the owner of such land, the rights of one and the other that the current value of Lot No. 356-A is P1,200,000.00 is not
shall be the same as though both had acted in good faith. supported by any evidence on record. HSTaEC
It is understood that there is bad faith on the part of the landowner Should the Torbela siblings choose to appropriate the
whenever the act was done with his knowledge and without improvements on Lot No. 356-A, the following ruling of the Court
opposition on his part. (Emphasis supplied.) in Pecson v. Court of Appeals 87 is relevant in the determination
When both the landowner and the builder are in good faith, the of the amount of indemnity under Article 546 of the Civil Code:
following rules govern: Article 546 does not specifically state how the value of the useful
ART. 448. The owner of the land on which anything has been built, improvements should be determined. The respondent court and
sown or planted in good faith, shall have the right to appropriate the private respondents espouse the belief that the cost of
as his own the works, sowing or planting, after payment of the construction of the apartment building in 1965, and not its current
indemnity provided for in articles 546 and 548, or to oblige the one market value, is sufficient reimbursement for necessary and useful
who built or planted to pay the price of the land, and the one who improvements made by the petitioner. This position is, however,
sowed, the proper rent. However, the builder or planter cannot be not in consonance with previous rulings of this Court in similar
obliged to buy the land if its value is considerably more than that cases. In Javier vs. Concepcion, Jr., this Court pegged the value
of the building or trees. In such case, he shall pay reasonable rent, of the useful improvements consisting of various fruits, bamboos,
if the owner of the land does not choose to appropriate the building a house and camarin made of strong material based on
or trees after proper indemnity. The parties shall agree upon the the market value of the said improvements. In Sarmiento vs.
terms of the lease and in case of disagreement, the court shall fix Agana, despite the finding that the useful improvement, a
the terms thereof. residential house, was built in 1967 at a cost of between eight
ART. 546. Necessary expenses shall be refunded to every thousand pesos (P8,000.00) to ten thousand pesos (P10,000.00),
possessor; but only the possessor in good faith may retain the the landowner was ordered to reimburse the builder in the amount
thing until he has been reimbursed therefor. of forty thousand pesos (P40,000.00), the value of the house at
Useful expenses shall be refunded only to the possessor in good the time of the trial. In the same way, the landowner was required
faith with the same right of retention, the person who has defeated to pay the "present value" of the house, a useful improvement, in
him in the possession having the option of refunding the amount the case of De Guzman vs. De la Fuente, cited by the petitioner.
of the expenses or of paying the increase in value which the thing The objective of Article 546 of the Civil Code is to administer
may have acquired by reason thereof. justice between the parties involved. In this regard, this Court had
ART. 548. Expenses for pure luxury or mere pleasure shall not be long ago stated in Rivera vs. Roman Catholic Archbishop of
refunded to the possessor in good faith; but he may remove the Manila that the said provision was formulated in trying to adjust the
ornaments with which he has embellished the principal thing if it rights of the owner and possessor in good faith of a piece of land,
suffers no injury thereby, and if his successor in the possession to administer complete justice to both of them in such a way as
does not prefer to refund the amount expended. neither one nor the other may enrich himself of that which does
Whatever is built, planted, or sown on the land of another, and the not belong to him. Guided by this precept, it is therefore
improvements or repairs made thereon, belong to the owner of the the current market value of the improvements which should be
land. Where, however, the planter, builder, or sower has acted in made the basis of reimbursement. A contrary ruling would unjustly
good faith, a conflict of rights arises between the owners and it enrich the private respondents who would otherwise be allowed to
becomes necessary to protect the owner of the improvements acquire a highly valued income-yielding four-unit apartment
without causing injustice to the owner of the land. In view of the building for a measly amount. Consequently, the parties should
impracticability of creating what Manresa calls a state of "forced therefore be allowed to adduce evidence on the present market
value of the apartment building upon which the trial court should give much credence to Duque-Rosario's claim of sole ownership
base its finding as to the amount of reimbursement to be paid by of Lot No. 5-F-8-C-2-B-2-A. Also, the question of whether Lot No.
the landowner. 88(Emphases supplied.) 5-F-8-C-2-B-2-A was the paraphernal property of Duque-Rosario
Still following the rules of accession, civil fruits, such as rents, or the conjugal property of the spouses Rosario would not alter the
belong to the owner of the building. 89 Thus, Dr. Rosario has a outcome of Duque-Rosario's Petition.
right to the rents of the improvements on Lot No. 356-A and is The following facts are undisputed: Banco Filipino extrajudicially
under no obligation to render an accounting of the same to foreclosed the mortgage constituted on Lot No. 5-F-8-C-2-B-2-A
anyone. In fact, it is the Torbela siblings who are required to and the two other properties after Dr. Rosario defaulted on the
account for the rents they had collected from the lessees of the payment of his loan; Banco Filipino was the highest bidder for all
commercial building and turn over any balance to Dr. Rosario. Dr. three properties at the foreclosure sale on April 2, 1987; the
Rosario's right to the rents of the improvements on Lot No. 356-A Certificate of Sale dated April 2, 1987 was registered in April 1987;
shall continue until the Torbela siblings have chosen their option and based on the Certificate of Final Sale dated May 24, 1988 and
under Article 448 of the Civil Code.And in case the Torbela siblings Affidavit of Consolidation dated May 25, 1988, the Register of
decide to appropriate the improvements, Dr. Rosario shall have Deeds cancelled TCT No. 104189 and issued TCT No. 165812 in
the right to retain said improvements, as well as the rents thereof, the name of Banco Filipino for Lot No. 5-F-8-C-2-B-2-A on June 7,
until the indemnity for the same has been paid. 90 1988.
Dr. Rosario is liable for damages to The Court has consistently ruled that the one-year redemption
the Torbela siblings. period should be counted not from the date of foreclosure sale, but
The Court of Appeals ordered Dr. Rosario to pay the Torbela from the time the certificate of sale is registered with the Registry
siblings P300,000.00 as moral damages; P200,000.00 as of Deeds. 91 No copy of TCT No. 104189 can be found in the
exemplary damages; and P100,000.00 as attorney's fees. records of this case, but the fact of annotation of the Certificate of
Indeed, Dr. Rosario's deceit and bad faith is evident when, being Sale thereon was admitted by the parties, only differing on the date
fully aware that he only held Lot No. 356-A in trust for the Torbela it was made: April 14, 1987 according to Banco Filipino and April
siblings, he mortgaged said property to PNB and Banco Filipino 15, 1987 as maintained by Duque-Rosario. Even if the Court
absent the consent of the Torbela siblings, and caused the concedes that the Certificate of Sale was annotated on TCT No.
irregular cancellation of the Torbela siblings' adverse claim on TCT 104189 on the later date, April 15, 1987, the one-year redemption
No. 52751. Irrefragably, Dr. Rosario's betrayal had caused the period already expired on April 14, 1988. 92 The Certificate of
Torbela siblings (which included Dr. Rosario's own mother, Final Sale and Affidavit of Consolidation were executed more than
Eufrosina Torbela Rosario) mental anguish, serious anxiety, and a month thereafter, on May 24, 1988 and May 25, 1988,
wounded feelings. Resultantly, the award of moral damages is respectively, and were clearly not premature.
justified, but the amount thereof is reduced to P200,000.00. It is true that the rule on redemption is liberally construed in favor
In addition to the moral damages, exemplary damages may also of the original owner of the property. The policy of the law is to aid
be imposed given that Dr. Rosario's wrongful acts were rather than to defeat him in the exercise of his right of
accompanied by bad faith. However, judicial discretion granted to redemption. 93 However, the liberal interpretation of the rule on
the courts in the assessment of damages must always be redemption is inapplicable herein as neither Duque-Rosario nor
exercised with balanced restraint and measured objectivity. The Dr. Rosario had made any attempt to redeem Lot No. 5-F-8-C-2-
circumstances of the case call for a reduction of the award of B-2-A. Duque-Rosario could only rely on the efforts of the Torbela
exemplary damages to P100,000.00. cDCaTH siblings at redemption, which were unsuccessful. While the
As regards attorney's fees, they may be awarded when the Torbela siblings made several offers to redeem Lot No. 356-A, as
defendant's act or omission has compelled the plaintiff to litigate well as the two other properties mortgaged by Dr. Rosario, they
with third persons or to incur expenses to protect his interest. did not make any valid tender of the redemption price to effect a
Because of Dr. Rosario's acts, the Torbela siblings were valid redemption. The general rule in redemption is that it is not
constrained to institute several cases against Dr. Rosario and his sufficient that a person offering to redeem manifests his desire to
spouse, Duque-Rosario, as well as Banco Filipino, which had do so. The statement of intention must be accompanied by an
lasted for more than 25 years. Consequently, the Torbela siblings actual and simultaneous tender of payment. The redemption price
are entitled to an award of attorney's fees and the amount of should either be fully offered in legal tender or else validly
P100,000.00 may be considered rational, fair, and reasonable. consigned in court. Only by such means can the auction winner be
Banco Filipino is entitled to a writ of assured that the offer to redeem is being made in good faith. 94 In
possession for Lot No. 5-F-8-C-2-B-2-A. case of disagreement over the redemption price, the redemptioner
The Court emphasizes that Pet. Case No. U-822, instituted by may preserve his right of redemption through judicial action, which
Banco Filipino for the issuance of a writ of possession before the in every case, must be filed within the one-year period of
RTC of Urdaneta, included only Lot No. 5-F-8-C-2-B-2-A and Lot redemption. The filing of the court action to enforce redemption,
No. 356-A (Lot No. 4489, the third property mortgaged to secure being equivalent to a formal offer to redeem, would have the effect
Dr. Rosario's loan from Banco Filipino, is located in Dagupan City, of preserving his redemptive rights and "freezing" the expiration of
Pangasinan, and the petition for issuance of a writ of possession the one-year period. 95 But no such action was instituted by the
for the same should be separately filed with the RTC of Dagupan Torbela siblings or either of the spouses Rosario. TcSICH
City). Since the Court has already granted herein the Duque-Rosario also cannot bar the issuance of the writ of
reconveyance of Lot No. 356-A from Banco Filipino to the Torbela possession over Lot No. 5-F-8-C-2-B-2-A in favor of Banco Filipino
siblings, the writ of possession now pertains only to Lot No. 5-F-8- by invoking the pendency of Civil Case No. U-4359, the Torbela
C-2-B-2-A. siblings' action for recovery of ownership and possession and
To recall, the Court of Appeals affirmed the issuance by the RTC damages, which supposedly tolled the period for redemption of the
of a writ of possession in favor of Banco Filipino. Dr. Rosario no foreclosed properties. Without belaboring the issue of Civil Case
longer appealed from said judgment of the appellate court. Already No. U-4359 suspending the redemption period, the Court simply
legally separated from Dr. Rosario, Duque-Rosario alone points out to Duque-Rosario that Civil Case No. U-4359 involved
challenges the writ of possession before this Court through her Lot No. 356-A only, and the legal consequences of the institution,
Petition in G.R. No. 140553. pendency, and resolution of Civil Case No. U-4359 apply to Lot
Duque-Rosario alleges in her Petition that Lot No. 5-F-8-C-2-B-2- No. 356-A alone.
A had been registered in her name under TCT No. 104189. Yet, Equally unpersuasive is Duque-Rosario's argument that the writ of
without a copy of TCT No. 104189 on record, the Court cannot possession over Lot No. 5-F-8-C-2-B-2-A should not be issued
given the defects in the conduct of the foreclosure sale (i.e., lack CARPIO, J p:
of personal notice to Duque-Rosario) and consolidation of title (i.e., The Case
failure to provide Duque-Rosario with copies of the Certificate of This is a petition 1 for review on certiorari under Rule 45 of the
Final Sale). Rules of Court. The petition challenges the 29 October 2004
The right of the purchaser to the possession of the foreclosed Decision 2 of the Court of Appeals in CA-G.R. CV No. 63757. The
property becomes absolute upon the expiration of the redemption Court of Appeals affirmed with modification the 6 April 1998
period. The basis of this right to possession is the purchaser's Decision 3 of the Regional Trial Court (RTC), Judicial Region 1,
ownership of the property. After the consolidation of title in the Branch 8, La Trinidad, Benguet, in Civil Case No. 84-CV-0094.
buyer's name for failure of the mortgagor to redeem, the writ of The Facts
possession becomes a matter of right and its issuance to a Larry A. Ogas (Ogas) owned a 1,329-square meter parcel of land
purchaser in an extrajudicial foreclosure is merely a ministerial situated in Pico, La Trinidad, Benguet. The property was covered
function. 96 by Transfer Certificate of Title (TCT) No. T-1068, and a portion
The judge with whom an application for a writ of possession is filed was subject to a 30-year lease agreement 4 with Esso Standard
need not look into the validity of the mortgage or the manner of its Eastern, Inc. Ogas sold the property to his daughter Rose
foreclosure. Any question regarding the validity of the mortgage or O. Alciso (Alciso). TCT No T-1068 was cancelled and TCT No. T-
its foreclosure cannot be a legal ground for the refusal to issue a 12422 5 was issued in the name of Alciso.
writ of possession. Regardless of whether or not there is a pending On 25 August 1979, Alciso entered into a Deed of Sale with Right
suit for the annulment of the mortgage or the foreclosure itself, the to Repurchase, 6 selling the property to Jaime Sansano
purchaser is entitled to a writ of possession, without prejudice, of (Sansano) for P10,000. Alciso later repurchased the property from
course, to the eventual outcome of the pending annulment case. Sansano and, on 28 March 1980, she entered into another Deed
The issuance of a writ of possession in favor of the purchaser in a of Absolute Sale, 7 this time selling the property to Celso S. Bate
foreclosure sale is a ministerial act and does not entail the exercise (Bate) for P50,000. The Deed stated that:
of discretion. 97 The SELLER warrants that her title to and ownership of the
WHEREFORE, in view of the foregoing, the Petition of the Torbela property herein conveyed are free from all liens and
siblings in G.R. No. 140528 is GRANTED, while the Petition of encumbrances except those as appear on the face of the title,
Lena Duque-Rosario in G.R. No. 140553 is DENIED for lack of specifically, that lease over the said property in favor of ESSO
merit. The Decision dated June 29, 1999 of the Court of Appeals STANDARD EASTERN, INC., the rights over which as a lessor the
in CA-G.R. CV No. 39770, which affirmed with modification the SELLER likewise hereby transfers in full to the buyer. 8 cHECAS
Amended Decision dated January 29, 1992 of the RTC in Civil TCT No. T-12422 was cancelled and TCT No. T-16066 9 was
Case Nos. U-4359 and U-4733 and Pet. Case No. U-822, issued in the name of Bate. On 14 August 1981, Bate entered into
is AFFIRMED WITH MODIFICATIONS, to now read as follows: a Deed of Sale of Realty, 10 selling the property to the spouses
(1) Banco Filipino is ORDERED to reconvey Lot No. 356-A to the Dominador R. Narvaez and Lilia W. Narvaez (Spouses Narvaez)
Torbela siblings; for P80,000. TCT No. T-16066 was cancelled and TCT No. T-
(2) The Register of Deeds of Pangasinan is ORDERED to cancel 16528 11 was issued in the name of the Spouses Narvaez. In
TCT No. 165813 in the name of Banco Filipino and to issue a new 1982, the Spouses Narvaez built a commercial building on the
certificate of title in the name of the Torbela siblings for Lot No. property amounting to P300,000.
356-A; Alciso demanded that a stipulation be included in the 14 August
(3) The case is REMANDED to the RTC for further proceedings to 1981 Deed of Sale of Realty allowing her to repurchase the
determine the facts essential to the proper application of Articles property from the Spouses Narvaez. In compliance with Alciso's
448 and 546 of the Civil Code, particularly: (a) the present fair demand, the Deed stated that, "The SELLER (Bate) carries over
market value of Lot No. 356-A; (b) the present fair market value of the manifested intent of the original SELLER of the property
the improvements thereon; (c) the option of the Torbela siblings to (Alciso) to buy back the same at a price under such conditions as
appropriate the improvements on Lot No. 356-A or require Dr. the present BUYERS (Spouses Narvaez) may impose." The
Rosario to purchase Lot No. 356-A; and (d) in the event that the Spouses Narvaez furnished Alciso with a copy of the Deed.
Torbela siblings choose to require Dr. Rosario to purchase Lot No. Alciso alleged that she informed the Spouses Narvaez that she
356-A but the value thereof is considerably more than the wanted to repurchase the property. The
improvements, then the reasonable rent of Lot No. 356-A to be Spouses Narvaez demanded P300,000, but Alciso was willing to
paid by Dr. Rosario to the Torbela siblings; pay only P150,000. Alciso and the Spouses Narvaez failed to
(4) The Torbela siblings are DIRECTED to submit an accounting reach an agreement on the repurchase price.
of the rents of the improvements on Lot No. 356-A which they had In a Complaint 12 dated 15 June 1984 and filed with the
received and to turn over any balance thereof to Dr. Rosario; RTC, Alciso prayed that (1) the 25 August 1979 Deed of Sale with
(5) Dr. Rosario is ORDERED to pay the Torbela siblings Right to Repurchase, the 28 March 1980 Deed of Absolute Sale,
P200,000.00 as moral damages, P100,000.00 as exemplary and the 14 August 1981 Deed of Sale of Realty be annulled; (2)
damages, and P100,000.00 as attorney's fees; and the Register of Deeds be ordered to cancel TCT Nos. T-16066 and
(6) Banco Filipino is entitled to a writ of possession over Lot-5-F- T-16528; (3) the Spouses Narvaezbe ordered to reconvey the
8-C-2-B-2-A, covered by TCT No. 165812. The RTC Branch Clerk property; and (4) Sansano, Bate, and the Spouses Narvaez be
of Court is ORDERED to issue a writ of possession for the said ordered to pay damages, attorney's fees and expenses of
property in favor of Banco Filipino. litigation. Alciso claimed that the intention of the parties was to
SO ORDERED. enter into a contract of real estate mortgage and not a contract of
||| (Torbela v. Spouses Rosario, G.R. No. 140528, 140553, sale with right of repurchase. She stated that:
[December 7, 2011], 678 PHIL 1-63) [C]ontrary to the clear intention and agreement of the parties,
particularly the plaintiffs herein, defendant JAIME SANSANO,
NARVAEZ v. ALCISO taking advantage of the good faith and financial predicament and
FIRST DIVISION difficulties of plaintiffs at the time, caused to be prepared and
[G.R. No. 165907. July 27, 2009.] induced with insidous [sic] words and machinations, prevailed
SPS. DOMINADOR R. NARVAEZ and LILIA upon plaintiff to sign a contract denominated as "Sale With Right
W. NARVAEZ, petitioners, vs. SPS. ROSE OGAS ALCISO and to Repurchase", instead of Deed of Real Estate Mortgage as was
ANTONIO ALCISO, respondents. the clear intention and agreement of the parties.
DECISION xxx xxx xxx
Defendant JAIME SANSANO caused to be prepared a contract All the requisites are present in the instant case: (1) there is a
denominated as DEED OF ABSOLUTE SALE, covering the lot in stipulation in favor of Alciso; (2) the stipulation is a part, not the
question, contrary to the clear intention and understanding of whole, of the contract; (3) Bate and the Spouses Narvaez clearly
plaintiff who was inveigled into signing said contract under the and deliberately conferred a favor to Alciso; (4) the favor is
impression that what she was executing was a real estate unconditional and uncompensated; (5) Alciso communicated her
mortgage. 13 ESCcaT acceptance of the favor before its revocation she demanded
The RTC's Ruling that a stipulation be included in the 14 August 1981 Deed of Sale
In its 6 April 1998 Decision, the RTC held that (1) the 25 August of Realty allowing her to repurchase the property from the
1979 Deed of Sale with Right to Repurchase became functus Spouses Narvaez, and she informed the Spouses Narvaez that
officio when Alciso repurchased the property; (2) the action to she wanted to repurchase the property; and (6) Bate and the
annul the 28 March 1980 Deed of Absolute Sale had prescribed; Spouses Narvaez did not represent, and were not authorized
(3) Alciso had no legal personality to annul the 14 August 1981 by, Alciso.
Deed of Sale of Realty; (4) the 14 August 1981 Deed of Sale of The Spouses Narvaez claim that Alciso did not communicate her
Realty contained a stipulation pour autrui in favor acceptance of the favor. They state that:
of Alciso Alciso could repurchase the property; A perusal of the provision of the Deed of Sale of Realty between
(5) Alciso communicated to the Spouses Narvaezher acceptance Celso Bate and the spouses Dominador R. Narvaez and Lilia
of the favor contained in the stipulation pour autrui; (6) the W. Narvaez (Annex "B") which clearly provides that "the third
repurchase price was P80,000; (7) Alciso could either appropriate person" (Rose O. Alciso) must have communicated her
the commercial building after payment of the indemnity equivalent acceptance to the obligors (spouses Dominador R. Narvaez and
to one-half of its market value when constructed or sell the land to Lilia W. Narvaez) before its revocation was not complied with. The
the Spouses Narvaez; and (8) Alciso was entitled to P100,000 acceptance is at best by mere inference. ScHAIT
attorney's fees and P20,000 nominal damages. xxx xxx xxx
The Spouses Narvaez appealed to the Court of Appeals. In their Petitioner Narvaez clearly stated that while the contract (Deed of
Appellants Brief 14 dated 21 November 2000, the Sale of Realty, Annex "D") contained an [sic] stipulation in favor of
Spouses Narvaez claimed that (1) the 14 August 1981 Deed of a third person (Rose O. Alciso), she did not demand its fulfillment
Sale of Realty did not contain a stipulation pour autrui not all and communicate her acceptance to the obligors before its
requisites were present; (2) the RTC erred in setting the revocation.
repurchase price at P80,000; (3) they were purchasers for value xxx xxx xxx
and in good faith; and (4) they were builders in good faith. We maintain that the stipulation aforequoted is not a
The Court of Appeals' Ruling stipulation pour autrui. Let the following be emphasized:
In its 29 October 2004 Decision, the Court of Appeals held that (1) 1. While the contract contained a stipulation in favor of a third
the 14 August 1981 Deed of Sale of Realty contained a person (Rose Alciso) she did not demand its fulfillment and she
stipulation pour autrui; (2) Alciso accepted the favor contained in never communicated her acceptance to the obligors
the stipulation pour autrui; (3) the RTC erred in setting the (Spouses Narvaez) before its revocation (Uy Tam vs. Leonard, 30
repurchase price at P80,000; (4) the 14 August 1981 Deed of Sale Phil. 471; Coquia vs. Fieldmen's Insurance Co., Inc., 26 SCRA
of Realty involved a contract of sale with right of repurchase and 178)
not real estate mortgage; (5) the Spouses Narvaez were builders 2. Granting arguendo that the stipulation is a pour autrui yet in the
in good faith; and (6) Alciso could either appropriate the three meetings Rose Alciso had with Mrs. Narvaez she never
commercial building after payment of the indemnity or oblige the demanded fulfillment of the alleged stipulation pour autrui and,
Spouses Narvaez to pay the price of the land, unless the price was what is worse, she did not communicate her acceptance to the
considerably more than that of the building. The Court of Appeals obligors before it is revoked. 16
remanded the case to the RTC for determination of the property's A petition for review on certiorari under Rule 45 of the Rules of
reasonable repurchase price. Court should include only questions of law questions of fact are
The Issue not reviewable. A question of law exists when the doubt centers
The Spouses Narvaez elevated the case to the Court. In their on what the law is on a certain set of facts, while a question of fact
Petition dated 15 December 2004, the Spouses Narvaez claimed exists when the doubt centers on the truth or falsity of the alleged
that Alciso did not communicate her acceptance of the favor facts. There is a question of law if the issue raised is capable of
contained in the stipulation pour autrui; thus, she could not being resolved without need of reviewing the probative value of
repurchase the property. CDaSAE the evidence. Once the issue invites a review of the evidence, the
The Court's Ruling question is one of fact. 17
The petition is unmeritorious. Whether Alciso communicated to the Spouses Narvaez her
Article 1311, paragraph 2, of the Civil Code states the rule on acceptance of the favor contained in the stipulation pour autrui is
stipulations pour autrui: a question of fact. It is not reviewable.
If a contract should contain some stipulation in favor of a third The factual findings of the trial court, especially when affirmed by
person, he may demand its fulfillment provided he communicated the Court of Appeals, are binding on the Court. 18 In its 6 April
his acceptance to the obligor before its revocation. A mere 1998 Decision, the RTC found that Alcisocommunicated to the
incidental benefit or interest of a person is not sufficient. The Spouses Narvaez her acceptance of the favor contained in the
contracting parties must have clearly and deliberately conferred a stipulation pour autrui. The RTC stated that:
favor upon a third person. Rose Alciso communicated her acceptance of such favorable
In Limitless Potentials, Inc. v. Quilala, 15 the Court laid down the stipulation when she went to see defendant
requisites of a stipulation pour autrui: (1) there is a stipulation in Lillia [sic] Narvaez in their house. Under the foregoing
favor of a third person; (2) the stipulation is a part, not the whole, circumstances, there is no question that plaintiff Rose Alciso can
of the contract; (3) the contracting parties clearly and deliberately maintain her instant action for the enforcement and/or fulfillment of
conferred a favor to the third person the favor is not an the aforestated stipulation in her favor to by [sic] back the property
incidental benefit; (4) the favor is unconditional and in question. 19 (Emphasis supplied) CSTDEH
uncompensated; (5) the third person communicated his or her In Florentino v. Encarnacion, Sr., 20 the Court held that the
acceptance of the favor before its revocation; and (6) the acceptance may be made at any time before the favorable
contracting parties do not represent, or are not authorized by, the stipulation is revoked and that the acceptance may be in any
third party. form it does not have to be formal or express but may be
implied. During the trial, Alciso testified that she informed the of the building or tress. * In such case, he shall pay reasonable
Spouses Narvaez that she wanted to repurchase the property: rent, if the owner of the land does not choose to appropriate the
Q What was your proposal to Mrs. Narvaez by way of settlement? building or trees after proper indemnity. The parties shall agree
A I tried to go to her and asked her if I could redeem the property upon the terms of the lease and in case of disagreement, the court
and Mrs. Narvaez told me why not, you could redeem the property shall fix the terms thereof. HDcaAI
but not our price. Applying said Article, plaintiffs-appellees, after repurchasing the
xxx xxx xxx land, will have the following options:
Q Now, when you went back to her, what if any did you propose to (1) to appropriate for themselves the building upon payment of its
her or tell her, Madam witness? value to defendants-appellants Narvaez spouses; OR
A I just asked for the redemption for the property, sir and she just (2) to compel the defendants-appellants Narvaez spouses to buy
told me wa [sic] the price that I could only redeem the property. the land, unless the value of thereof [sic] be considerably more
Q Three Hundred thousand pesos? than that of the building, in which case, said spouses may lease
A Yes, Sir. the land instead. The parties shall agree upon the terms of the
Q Did you make any counter proposal? lease and in case of disagreement, the courts shall fix the terms
A Yes, for the third time I want [sic] back again your Honor . . . 21 thereof. 23
The exceptions to the rule that the factual findings of the trial court The Court disagrees.
are binding on the Court are (1) when there is grave abuse of The rule is that only errors specifically assigned and properly
discretion; (2) when the findings are grounded on speculations; (3) argued in the appellant's brief will be considered, except
when the inference made is manifestly mistaken; (4) when the jurisdictional and clerical errors. 24 However, the Court is clothed
judgment of the Court of Appeals is based on a misapprehension with ample authority to review matters not assigned as errors if
of facts; (5) when the factual findings are conflicting; (6) when the their consideration is necessary in arriving at a just decision. 25
Court of Appeals went beyond the issues of the case and its Article 448 is inapplicable in cases involving contracts of sale with
findings are contrary to the admissions of the parties; (7) when the right of repurchase it is inapplicable when the owner of the land
Court of Appeals overlooked undisputed facts which, if properly is the builder, sower, or planter. InPecson v. Court of
considered, would justify a different conclusion; (8) when the Appeals, 26 the Court held that:
findings of the Court of Appeals are contrary to those of the trial Article 448 does not apply to a case where the owner of the
court; (9) when the facts set forth by the petitioners are not land is the builder, sower, or planter who then later loses
disputed by the respondents; and (10) when the findings of the ownership of the land by sale or donation. This Court said so
Court of Appeals are premised on the absence of evidence and in Coleongco v. Regalado:
are contradicted by the evidence on record. 22 The Article 361 of the old Civil Code is not applicable in this case,
Spouses Narvaez did not show that the instant case falls under for Regalado constructed the house on his own land before he
any of the exceptions. ACIEaH sold said land to Coleongco. Article 361 applies only in cases
In its 29 October 2004 Decision, the Court of Appeals held that where a person constructs a building on the land of another
Bate and the Spouses Narvaez entered into a sale with right of in good or in bad faith, as the case may be. It does not apply
repurchase and that, applying Article 448 of the Civil to a case where a person constructs a building on his own
Code, Alciso could either appropriate the commercial building land, for then there can be no question as to good or bad faith
after payment of the indemnity or oblige the Spouses Narvaez to on the part of the builder.
pay the price of the land, unless the price was considerably more Elsewise stated, where the true owner himself is the builder of
than that of the building. Article 448 states: the works on his own land, the issue of good faith or bad faith
Art. 448. The owner of the land on which anything has been built, is entirely irrelevant. (Emphasis supplied) HcSaAD
sown or planted in good faith, shall have the right to appropriate Article 448 is inapplicable in the present case because the
as his own the works, sowing or planting, after payment of the Spouses Narvaez built the commercial building on the land that
indemnity provided for in Articles 546 and 548, or to oblige the one they own. Besides, to compel them to buy the land, which they
who built or planted to pay the price of the land, and the one who own, would be absurd.
sowed, the proper rent. However, the builder or planter cannot be As the Court of Appeals correctly observed, the terms of the 14
obliged to buy the land if its value is considerably more than that August 1981 Deed of Sale of Realty show that Bate and the
of the building or the trees. In such case, he shall pay reasonable Spouses Narvaez entered into a sale with right of repurchase,
rent, if the owner of the land does not choose to appropriate the where Bate transferred his right of repurchase to Alciso. The Deed
building or trees after proper indemnity. The parties shall agree states that, "The SELLER (Bate) carries over the manifested intent
upon the terms of the lease and in case of disagreement, the court of the original SELLER of the property (Alciso) to buy back the
shall fix the terms thereof. same at a price under such conditions as the present BUYERS
The Court of Appeals stated that: (Spouses Narvaez) may impose." Article 1601 of the Civil Code
[T]he contract between defendants-appellants Bate states that, "Conventional redemption shall take place when the
and Narvaez spouses is a contract of sale with a stipulation vendor reserves the right to repurchase the thing sold, with the
granting plaintiffs-appellees the right to repurchase the property at obligation to comply with the provisions of Article 1616 and other
a reasonable price. Being the absolute owners of the property in stipulations which may have been agreed upon." In Gallar v.
question, defendants-appellants Narvaez spouses have the Husain, 27 the Court held that "the right of repurchase may be
undisputed right to use, enjoy and build thereon. exercised only by the vendor in whom the right is recognized by
Having built the improvement on the land they own and registered contract or by any person to whom the right may have been
in their names, they are likened to builders in good faith and their transferred."
rights over the improvement shall be governed by Article 448 of In a sale with right of repurchase, the applicable provisions are
the Civil Code which provides: Articles 1606 and 1616 of the Civil Code, not Article 448. Articles
ART. 448. The owner of the land on which anything has been built, 1606 and 1616 state:
sown or planted in good faith, shall have the right to appropriate Art. 1606. The right referred to in Article 1601, in the absence of
as his own the works, sowing or planting, after payment of the an express agreement, shall last four years from the date of the
indemnity provided for in articles 546 and 548, or to oblige the one contract.
who built or planted to pay the price of the land, and the one who Should there be an agreement, the period cannot exceed ten
sowed, the proper rent. However, the builder or planter cannot be years.
obliged to buy the land if its value is considerably more than that
However, the vendor may still exercise the right to repurchase her right of redemption by paying the petitioners Spouses
within thirty days from the time final judgment was rendered in a Dominador R. Narvaez and Lilia W. Narvaez (1) the price of the
civil action on the basis that the contract was a true sale with right sale, (2) the expenses of the contract, (3) legitimate payments
to repurchase. made by reason of the sale, and (4) the necessary and useful
Art. 1616. The vendor cannot avail himself of the right of expenses made on the subject property. The Court DIRECTS the
repurchase without returning to the vendee the price of the sale, Regional Trial Court, Judicial Region 1, Branch 8, La Trinidad,
and in addition: Benguet, to determine the amounts of the expenses of the
(1) The expenses of the contract, and any other legitimate contract, the legitimate expenses made by reason of the sale, and
payments made by reason of the sale; the necessary and useful expenses made on the subject property.
(2) The necessary and useful expenses made on the thing After such determination, respondent Rose O. Alciso shall have
sold. aCcEHS 30 days to pay the amounts to petitioners Spouses Dominador
Under Article 1616, Alciso may exercise her right of redemption by R. Narvaez and Lilia W. Narvaez.
paying the Spouses Narvaez (1) the price of the sale, (2) the SO ORDERED.
expenses of the contract, (3) legitimate payments made by reason ||| (Spouses Narvaez v. Spouses Alciso, G.R. No. 165907, [July
of the sale, and (4) the necessary and useful expenses made on 27, 2009], 611 PHIL 452-469)
the thing sold. In the present case, the cost of the building
constitutes a useful expense. Useful expenses include FELICIANO v. ZALDIVAR
improvements which augment the value of the land. 28 FIRST DIVISION
Under the first paragraph of Article 1606, Alciso had four years [G.R. No. 162593. September 26, 2006.]
from 14 August 1981 to repurchase the property since there was REMEGIA Y. FELICIANO, Substituted by the Heirs of Remegia
no express agreement as to the period when the right can be Y. Feliciano, as represented by NILO
exercised. Tender of payment of the repurchase price is necessary Y. FELICIANO, petitioners, vs. SPOUSES AURELIO and
in the exercise of the right of redemption. Tender of payment is the LUZ ZALDIVAR, respondents.
seller's manifestation of his or her desire to repurchase the DECISION
property with the offer of immediate performance. 29 CALLEJO, SR., J p:
Alciso's intimation to the Spouses Narvaez that she wanted to Before the Court is the petition for review on certiorari filed by the
repurchase the property was insufficient. To have effectively Heirs of Remegia Y. Feliciano (as represented by Nilo
exercised her right of repurchase, Alciso should have tendered Y. Feliciano) seeking the reversal of the Decision 1 dated July 31,
payment. In Lee v. Court of Appeals, 30 the Court held that: 2003 of the Court of Appeals (CA) in CA-G.R. CV No. 66511 which
The rule that tender of payment of the repurchase price is ordered the dismissal of the complaint filed by Remegia
necessary to exercise the right of redemption finds support in civil Y. Feliciano 2 for declaration of nullity of title and reconveyance of
law. Article 1616 of the Civil Code of the Philippines . . . furnishes property. The assailed decision of the appellate court reversed and
the guide, to wit: "The vendor cannot avail himself of the right of set aside that of the Regional Trial Court (RTC) of Cagayan de Oro
repurchase without returning to the vendee the price of the sale . . City, Branch 25 in Civil Case No. 92-423.
." The factual and procedural antecedents of the present case are
Thus, in the case of Angao vs. Clavano, 17 Phil. 152, it was held as follows:
that "it is not sufficient for the vendor to intimate or to state to the Remegia Y. Feliciano filed against the spouses Aurelio and
vendee that the former desires to redeem the thing sold, but he Luz Zaldivar a complaint for declaration of nullity of Transfer
must immediately thereupon offer to repay the price . . ." Likewise, Certificate of Title (TCT) No. T-17993 and reconveyance of the
in several other cases decided by the Supreme Court (Fructo vs. property covered therein consisting of 243 square meters of lot
Fuentes, 15 Phil. 362; Retes vs. Suelto, 20 Phil. 394; Rosales vs. situated in Cagayan de Oro City. The said title is registered in the
Reyes, et al., 25 Phil. 495; Canuto vs. Mariano, 37 Phil. 840; De la name of Aurelio Zaldivar.
Cruz, et al. vs. Resurreccion, et al., 98 Phil. 975; and other cases) In her complaint, Remegia alleged that she was the registered
where the right to repurchase was held to have been properly owner of a parcel of land situated in the District of Lapasan in
exercised, there was a definite finding of tender of payment having Cagayan de Oro City with an area of 444 square meters, covered
been made by the vendor. (Emphasis supplied.) by TCT No. T-8502. Sometime in 1974, Aurelio, allegedly through
Nevertheless, under the third paragraph of Article fraud, was able to obtain TCT No. T-17993 covering the 243-sq-m
1606, Alciso has 30 days from the finality of this Decision to portion of Remegia's lot as described in her TCT No. T-8502.
exercise her right of repurchase. In Laserna v. Javier, 31 the Court According to Remegia, the 243-sq-m portion (subject lot) was
held that: originally leased from her by Pio Dalman, Aurelio's father-in-law,
The new Civil Code in Article 1606, thereof gives the vendors a for P5.00 a month, later increased to P100.00 a month in 1960.
retro "the right to repurchase within thirty days from the time final She further alleged that she was going to mortgage the subject lot
judgment was rendered in a civil action, on the basis that the to Ignacio Gil for P100.00, which, however, did not push through
contract was a true sale with the right to repurchase." This because Gil took back the money without returning the receipt she
provision has been construed to mean that "after the courts have had signed as evidence of the supposed mortgage contract.
decided by a final or executory judgment that the contract was Thereafter, in 1974, Aurelio filed with the then Court of First
a pacto de retro and not a mortgage, the vendor (whose claim as Instance of Misamis Oriental a petition for partial cancellation of
mortgagor had definitely been rejected) may still have the privilege TCT No. T-8502. It was allegedly made to appear therein that
of repurchasing within 30 days." (Perez, et al. vs. Zulueta, 106 Aurelio and his spouse Luz acquired the subject lot from Dalman
Phil., 264.) ECSHAD who, in turn, purchased it from Gil. The petition was granted and
The third paragraph of Article 1606 allows sellers, who considered TCT No. T-17993 was issued in Aurelio's name. aEcTDI
the transaction they entered into as mortgage, to repurchase the Remegia denied that she sold the subject lot either to Gil or
property within 30 days from the time they are bound by the Dalman. She likewise impugned as falsified the joint affidavit of
judgment finding the transaction to be one of sale with right of confirmation of sale that she and her uncle, Narciso Labuntog,
repurchase. purportedly executed before a notary public, where Remegia
WHEREFORE, the Court DENIES the petition. The appears to have confirmed the sale of the subject property to Gil.
Court AFFIRMS the 29 October 2004 Decision of the Court of She alleged that she never parted with the certificate of title and
Appeals in CA-G.R. CV No. 63757 that it was never lost. As proof that the sale of the subject lot never
with MODIFICATION.Respondent Rose O. Alciso may exercise
transpired, Remegia pointed out that the transaction was not presented by the spouses Zaldivar to prove the transaction. The
annotated on TCT No. T-8502. CA likewise found that Gil thereafter sold the subject property to
In their answer, the spouses Zaldivar denied the material Dalman who took actual possession thereof. By way of a
allegations in the complaint and raised the affirmative defense that document denominated as joint affidavit of confirmation of sale
Aurelio is the absolute owner and possessor of the subject lot as executed before notary public Francisco Velez on December 3,
evidenced by TCT No. 17993 and Tax Declaration No. 26864 1965, Remegia and her uncle, Narciso Labuntog, confirmed the
covering the same. Aurelio claimed that he acquired the subject sale by Remegia of the subject lot to Gil and its subsequent
lot by purchase from Dalman who, in turn, bought the same from conveyance to Dalman. Per Exhibit "6," the CA likewise found that
Gil on April 4, 1951. Gil allegedly purchased the subject lot from Dalman had declared the subject lot for taxation purposes in his
Remegia and this sale was allegedly conformed and ratified by the name. In 1965, Dalman sold the same to the
latter and her uncle, Narciso Labuntog, before a notary public on spouses Zaldivar who, in turn, had it registered in their names for
December 3, 1965. taxation purposes beginning 1974. Also in the same year, Aurelio
After Aurelio obtained a loan from the Government Service filed with the then CFI of Misamis Oriental a petition for the
Insurance System (GSIS), the spouses Zaldivar constructed their issuance of a new owner's duplicate copy of TCT No. T-8502,
house on the subject lot. They alleged that they and their alleging that the owner's duplicate copy was lost; the CFI granted
predecessors-in-interest had been occupying the said property the petition on March 20, 1974. Shortly, Aurelio filed with the same
since 1947 openly, publicly, adversely and continuously or for over CFI another petition, this time for the partial cancellation of TCT
41 years already. Aurelio filed a petition for the issuance of a new No. T-8502 and for the issuance of a new certificate of title in
owner's duplicate copy of TCT No. T-8502 because when he Aurelio's name covering the subject lot. The CFI issued an order
asked Remegia about it, the latter claimed that it had been granting the petition and, on the basis thereof, the Register of
lost. THEDCA Deeds of Cagayan de Oro City issued TCT No. T-17993 covering
After due trial, the RTC rendered judgment in favor of Remegia. It the subject lot in Aurelio's name.
declared that TCT No. 17993 in the name of Aurelio was null and Based on the foregoing factual findings, the appellate court upheld
void for having been obtained through misrepresentation, fraud or the spouses Zaldivar's ownership of the subject lot. The CA stated
evident bad faith by claiming in his affidavit that Remegia's title that Remegia's claim that she did not sell the same to Gil was
(TCT No. T-8502) had been lost, when in fact it still existed. belied by Exhibit "5," a deed which showed that she transferred
The court a quo explained that "the court that orders a title ownership thereof in favor of Gil. The fact that the said transaction
reconstituted when the original is still existing has not acquired was not annotated on Remegia's title was not given significance
jurisdiction over the case. A judgment otherwise final may be by the CA since the lack of annotation would merely affect the
annulled not only on extrinsic fraud but also for lack of rights of persons who are not parties to the said contract. The CA
jurisdiction." 3 Aurelio's use of a false affidavit of loss, according also held that the joint affidavit of confirmation of sale executed by
to the court a quo, was similar to the use during trial of a forged Remegia and Narciso Labuntog before a notary public was a valid
document or perjured testimony that prevented the adverse party, instrument, and carried the evidentiary weight conferred upon it
Remegia, from presenting her case fully and fairly. with respect to its due execution. 7 Moreover, the CA found that
The RTC likewise noted that no public instrument was presented the notary public (Atty. Francisco Velez) who notarized the said
in evidence conveyancing or transferring title to the subject lot from document testified not only to its due execution and authenticity
Remegia to Dalman, the alleged predecessor-in-interest of the but also to the truthfulness of its contents. The contradiction
spouses Zaldivar. The only evidence presented by the said between the testimonies of the children of Narciso Labuntog and
spouses was a joint affidavit of confirmation of sale purportedly the notary public (Atty. Velez), according to the CA, casts doubt on
signed by Remegia and her uncle, the execution of which was the credibility of the former as it was ostensible that their version
denied by the latter's children. The certificate of title of the of the story was concocted. 8
spouses Zaldivar over the subject property was characterized as The CA further accorded in favor of the judge who issued the order
irregular because it was issued in a calculated move to deprive for the issuance of the new owner's duplicate copy of TCT No. T-
Remegia of dominical rights over her own property. Further, the 8502 the presumption of regularity in the performance of his official
spouses Zaldivar could not set up the defense of indefeasibility of duty. It noted that the same was issued by the CFI after due notice
Torrens title since this defense does not extend to a transferor who and hearing. AECIaD
takes the certificate of title with notice of a flaw therein.
Registration, thus, did not vest title in favor of the spouses; neither Moreover, prescription and laches or estoppel had already set in
could they rely on their adverse or continuous possession over the against Remegia. The appellate court pointed out that TCT No. T-
subject lot for over 41 years, as this could not prevail over the title 17993 in the name of Aurelio was issued on September 10, 1974,
of the registered owner pursuant to Sections 50 4 and 51 5 of Act while Remegia's complaint for annulment and reconveyance of
No. 496, otherwise known as The Land Registration Act. property was filed more than 17 years thereafter or on August 10,
The dispositive portion of the decision of the court a quo reads: 1992. Consequently, Remegia's action was barred by prescription
IN THE LIGHT OF THE FOREGOING, and by preponderance of because an action for reconveyance must be filed within 10 years
evidence, judgment is hereby rendered canceling TCT T-17993 from the issuance of the title since such issuance operates as a
and reconveyance of 243 square meters the title and possession constructive notice. 9 The CA also noted that the
of the same, by vacating and turning over possession of the 243 spouses Zaldivar constructed their house on the subject lot some
square meters of the subject property to the plaintiff [referring to time in 1974-1975, including a 12-foot firewall made of hollow
Remegia] which is part of the land absolutely owned by the plaintiff blocks, and Remegia took no action to prevent the said
covered by [TCT] T-8502 and to solidarily pay the plaintiff Fifty construction.
Thousand Pesos (P50,000.00) as moral damages; Ten Thousand The dispositive portion of the assailed CA decision reads:
Pesos (P10,000.00) as exemplary damages; Fifty Thousand WHEREFORE, foregoing premises considered, the December 3,
Pesos (P50,000.00) as attorney's fees and Ten Thousand Pesos 1999 Decision of the Regional Trial Court of Misamis Oriental,
(P10,000.00) expenses for litigation to the plaintiff. Cagayan de Oro City, in Civil Case No. 92-423, is REVERSED
SO ORDERED. 6 and SET ASIDE and a new one is entered DISMISSING the said
On appeal, the CA reversed the decision of the RTC and ruled in civil case.
favor of the spouses Zaldivar. In holding that Remegia sold to Gil SO ORDERED. 10
a 243 sq m portion of the lot covered by TCT No. T-8502, the When their motion for reconsideration was denied by the CA in the
appellate court gave credence to Exhibit "5," the deed of sale assailed Resolution dated February 4, 2004, the heirs of Remegia
(the petitioners) sought recourse to the Court. In their petition for A No, Sir.
review, they allege that the appellate court gravely erred Q Was there any instance that this title was surrendered to the
A. Register of Deeds of the City of Cagayan de Oro?
IN NOT DISMISSING THE APPEAL OF THE RESPONDENTS A No, Sir. There never was an instance . . . There never was an
(DEFENDANTS-APELLANTS) MOTU PROPIO OR EXPUNGING instance that this title was surrendered to the Register of Deeds.
THE BRIEF FOR DEFENDANTS-APPELLANTS FROM RECORD Q As there any instance that you petitioned to the Honorable Court
FOR FAILURE TO FILE THE REQUIRED BRIEF FOR THE for the issuance of a new owner's duplicate copy of this title in lieu
DEFENDANTS-APPELLANTS ON TIME BUT BEYOND THE of the lost copy of said title?
LAST AND FINAL EXTENDED PERIOD WITHIN WHICH TO FILE A No, Sir. There was never an instance because this title was
THE SAID BRIEF IN VIOLATION TO SECTION 7 AND SECTION never lost. 14
12, RULE 44 OF THE REVISED RULES OF COURT AND IN Consequently, the court a quo correctly nullified TCT No. T-17993
CONTRADICTION TO THE RULING ENUNCIATED IN in Aurelio's name, emanating as it did from the new owner's
CATALINA ROXAS, ET AL. VS. COURT OF APPEALS, G.R. NO. duplicate TCT No. T-8502, which Aurelio procured through fraud.
L-76549, DECEMBER 10, 1987. Respondent Aurelio cannot raise the defense of indefeasibility of
B. title because "the principle of indefeasibility of a Torrens title does
IN DENYING THE MOTION FOR RECONSIDERATION WHICH not apply where fraud attended the issuance of the title. The
WAS FILED WITHIN THE FIFTEEN-DAY REGLEMENTARY Torrens title does not furnish a shield for fraud." 15 As such, a title
PERIOD IN VIOLATION TO THE RULES OF COURT. issued based on void documents may be annulled. 16
C. The appellate court's reliance on the joint affidavit of confirmation
IN RULING THAT THE COURT WHO ORDERED THE of sale purportedly executed by Remegia and her uncle, Narciso
ISSUANCE OF NEW CERTIFICATE OF TITLE DESPITE Labuntog, is not proper. In the first place, respondent Aurelio
EXISTENCE OF OWNER'S DUPLICATE COPY THAT WAS cannot rely on the joint affidavit of confirmation of sale to prove
NEVER LOST HAS JURISDICTION OVER THE CASE. that they had validly acquired the subject lot because, by itself, an
D. affidavit is not a mode of acquiring ownership. 17 Moreover, the
IN CONCLUDING THAT PETITIONER'S (PLAINTIFF- affidavit is written entirely in English in this wise:
APPELLEE) CLAIM OF OWNERSHIP OVER THE SUBJECT LOT JOINT AFFIDAVIT OF CONFIRMATION OF SALE 18
WAS BARRED BY ESTOPPEL OR LACHES. We, NARCISO LABUNTOG and REMEGIA YAPE
E. DE FELICIANO, both of legal age, Filipino citizens and residents
IN CONCLUDING THAT THE RESPONDENTS (DEFENDANTS- of Lapasan, Cagayan de Oro City, Philippines, after being duly
APPELLANTS) ARE THE ABSOLUTE OWNERS OF THE sworn according to law, depose and say:
SUBJECT LOT BASED ON TCT NO. 17993 ISSUED TO THEM. 1. That the late FRANCISCO LABUNTOG is our common
F. ancestor, the undersigned NARCISO LABUNTOG being one of his
IN OBVIATING ESSENTIAL AND RELEVANT FACTS, HAD IT sons and the undersigned REMEGIA YAPE DE FELICIANO being
BEEN PROPERLY APPRECIATED, WOULD MAINTAIN the daughter of the late Emiliana Labuntog, sister of Narciso
ABSOLUTE OWNERSHIP OF PETITIONER (PLAINTIFF- Labuntog; cADEIa
APPELLEE) OVER THE SUBJECT LOT AS EVIDENCED BY 2. That after his death, the late Francisco Labuntog left behind a
EXISTING TCT NO. T-8502. 11 parcel of land known as Lot No. 2166 C-2 of the Cagayan Cadastre
The Court finds the petition meritorious. situated at Lapasan, City of Cagayan de Oro, Philippines which is
It should be recalled that respondent Aurelio Zaldivar filed with the being administered by the undersigned Narciso Labuntog under
then CFI of Misamis Oriental a petition for issuance of a new Tax Decl. No. 27633;
owner's duplicate copy of TCT No. T-8502, alleging that the 3. That the entire Cadastral Lot No. 2166 C-2 has been subdivided
owner's duplicate copy was lost. In the Order dated March 20, and apportioned among the heirs of the late Francisco Labuntog,
1974, the said CFI granted the petition and consequently, a new both of the undersigned affiants having participated and shared in
owner's duplicate copy of TCT No. T-8502 was issued. the said property, Remegia Yape de Feliciano having inherited the
However, as the trial court correctly held, the CFI which granted share of her mother Emiliana Labuntog, sister of Narciso
respondent Aurelio's petition for the issuance of a new owner's Labuntog;
duplicate copy of TCT No. T-8502 did not acquire jurisdiction to 4. That on April 4, 1951, Remegia Yape de Feliciano sold a portion
issue such order. It has been consistently ruled that "when the of her share to one Ignacio Gil and which portion is more
owner's duplicate certificate of title has not been lost, but is in fact particularly described and bounded as follows:
in the possession of another person, then the reconstituted "On the North for 13 meters by Agustin Cabaraban;
certificate is void, because the court that rendered the decision On the South for 13 meters by Antonio Babanga;
had no jurisdiction. Reconstitution can validly be made only in case On the East for 18 meters by Clotilde Yape; and
of loss of the original certificate." 12 In such a case, the decision On the West for 18 meters by Agustin Cabaraban;"
authorizing the issuance of a new owner's duplicate certificate of 5. That sometime in the year 1960, the said Ignacio Gil conveyed
title may be attacked any time. 13 the same portion to Pio Dalman, who is of legal age, Filipino citizen
The new owner's duplicate TCT No. T-8502 issued by the CFI and likewise a resident of Lapasan, Cagayan de Oro City and that
upon the petition filed by respondent Aurelio is thus void. As since 1960 up to the present, the said Pio Dalman has been in
Remegia averred during her testimony, the owner's duplicate copy continuous, open, adverse and exclusive possession of the
of TCT No. T-8502 was never lost and was in her possession from property acquired by him in concept of owner;
the time it was issued to her: 6. That we hereby affirm, ratify and confirm the acquisition of the
Q A while ago, you said that you were issued a title in 1968, can above described portion acquired by Pio Dalman inasmuch as the
you tell the Honorable Court who was in possession of the title? same is being used by him as his residence and family home and
A I am the one in possession and I am the one keeping the title. we hereby request the Office of the City Assessor to segregate
Q Even up to the present? this portion from our Tax Decl. No. 27633 and that a new tax
A Yes, Sir. declaration be issued in the name of PIO DALMAN embracing the
Q Was there any instance that this title was borrowed from you? area acquired and occupied by him.
A No, Sir. IN WITNESS WHEREOF, we have hereunto affixed our
Q Was there any instance that this title was lost from your signatures on this 3rd day of December, 1965 at Cagayan de Oro
possession? City, Philippines.
(SGD.) Narciso Labuntog (SGD.)Remegia Yape de Feliciano Respondents' claim that they had been occupying the subject lot
NARCISO LABUNTOG REMEGIA YAPE DE FELICIANO since 1947 openly, publicly, adversely and continuously or for over
Affiant Affiant 41 years is unavailing. In a long line of cases, 22the Court has
SUBSCRIBED & SWORN to before me this 3rd day of December, consistently ruled that lands covered by a title cannot be acquired
1965 at Cagayan de Oro City, Philippines, affiants exhibited their by prescription or adverse possession. A claim of acquisitive
Residence Certificates as follows: NARCISO LABUNTOG, A- prescription is baseless when the land involved is a registered land
1330509 dated Oct. 5, 1965 and REMEGIA YAPE following Article 1126 23 of the Civil Code in relation to Section 46
DE FELICIANO, A-1811104 dated Dec. 3, 1965 both issued at of Act No. 496 or the Land Registration Act (now Section
Cagayan de Oro City. 47 24 of P.D. No 1529):
(SGD.) ILLEGIBLE Appellants' claim of acquisitive prescription is likewise baseless.
FRANCISCO X. VELEZ Under Article 1126 of the Civil Code, prescription of ownership of
Notary Public lands registered under the Land Registration Actshall be governed
However, based on Remegia's testimony, she could not read and by special laws. Correlatively, Act No. 496 provides that no title to
understand English: registered land in derogation of that of the registered owner shall
COURT: be acquired by adverse possession. Consequently, proof of
Can you read English? possession by the defendants is both immaterial and
A No, I cannot read and understand English. inconsequential. 25
ATTY. LEGASPI: Neither can the respondents spouses Zaldivar rely on the principle
Q What is your highest educational attainment? of indefeasibility of TCT No. 17793 which was issued on
A Grade 3. September 10, 1974 in favor of respondent Aurelio. As it is, the
Q But you can read and understand Visayan? subject lot is covered by two different titles: TCT No. T-8502 in
A Yes, I can read Visayan, but I cannot understand well idiomatic Remegia's name covering an area of 444 sq m including therein
visayan terms (laglom nga visayan). 19 the subject lot, and TCT No. 17793 in the name of respondent
On this point, Article 1332 of the Civil Code is relevant: Aurelio covering the subject lot. Aurelio's title over the subject lot
ART. 1332. When one of the parties is unable to read, or if the has not become indefeasible, by virtue of the fact that TCT No. T-
contract is in a language not understood by him, and mistake or 8502 in the name of Remegia has remained valid. The following
fraud is alleged, the person enforcing the contract must show that disquisition is apropos:
the terms thereof have been fully explained to the former. The claim of indefeasibility of the petitioner's title under the Torrens
The principle that a party is presumed to know the import of a land title system would be correct if previous valid title to the same
document to which he affixes his signature is modified by the parcel of land did not exist. The respondent had a valid title . . . It
foregoing article. Where a party is unable to read or when the never parted with it; it never handed or delivered to anyone its
contract is in a language not understood by the party and mistake owner's duplicate of the transfer certificate of title; it could not be
or fraud is alleged, the obligation to show that the terms of the charged with negligence in the keeping of its duplicate certificate
contract had been fully explained to said party who is unable to of title or with any act which could have brought about the issuance
read or understand the language of the contract devolves on the of another certificate upon which a purchaser in good faith and for
party seeking to enforce the contract to show that the other party value could rely. If the petitioner's contention as to indefeasibility
fully understood the contents of the document. If he fails to of his title should be upheld, then registered owners without the
discharge this burden, the presumption of mistake, if not, fraud, least fault on their part could be divested of their title and deprived
stands unrebutted and controlling. 20 of their property. Such disastrous results which would shake and
destroy the stability of land titles had not been foreseen by those
Applying the foregoing principles, the presumption is that who had endowed with indefeasibility land titles issued under the
Remegia, considering her limited educational attainment, did not Torrens system. 26
understand the full import of the joint affidavit of confirmation of Remegia's TCT No. T-8502, thus, prevails over respondent
sale and, consequently, fraud or mistake attended its execution. Aurelio's TCT No. 17793, especially considering that, as earlier
The burden is on respondents, the spouses Zaldivar, to rebut this opined, the latter was correctly nullified by the RTC as it emanated
presumption. They tried to discharge this onus by presenting Atty. from the new owner's duplicate TCT No. T-8502, which in turn,
Francisco Velez (later RTC Judge) who notarized the said respondent Aurelio was able to procure through fraudulent
document. Atty. Velez testified that he "read and interpreted" the means.
document to the affiants and he asked them whether the contents Contrary to the appellate court's holding, laches has not set in
were correct before requiring them to affix their signatures against Remegia. She merely tolerated the occupation by the
thereon. 21 The bare statement of Atty. Velez that he "read and respondents of the subject lot:
interpreted" the document to the affiants and that he asked them Q You also stated in the direct that the defendants in this case, Mr.
as to the correctness of its contents does not necessarily establish and Mrs. Zaldivar, were issued a title over a portion of this land
that Remegia actually comprehended or understood the import of which you described a while ago?
the joint affidavit of confirmation of sale. Nowhere is it stated in the A We knew about that only recently.
affidavit itself that its contents were fully explained to Remegia in Q When was that when you knew that the defendants were issued
the language that she understood before she signed the same. title over a portion of the land you described a while ago?
Thus, to the mind of the Court, the presumption of fraud or mistake A In June, 1992.
attending the execution of the joint affidavit of confirmation of sale Q In what way did you discover that a portion of the land was titled
was not sufficiently overcome. in the name of the defendants?
Moreover, the purported joint affidavit of confirmation of sale failed A I discovered that my property was titled by Mr. and
to state certain important information. For example, it did not Mrs. Zaldivar when I went to the Register of Deeds for the purpose
mention the consideration or price for the alleged sale by Remegia of partitioning my property among my children.
of the subject lot to Ignacio Gil. Also, while it stated that the subject Q And you were surprised why it is titled in their names?
lot was conveyed by Ignacio Gil to Pio Dalman, it did not say A Yes.
whether the conveyance was by sale, donation or any other mode Q Is it not a fact that the defendants have constructed their house
of transfer. Finally, it did not also state how the ownership of the on a portion of the land you described a while ago?
subject lot was transferred from Pio Dalman to respondent Aurelio
or respondents.
A Yes. I knew that the Zaldivars built a house on the property I A No. When we went to the barangay captain, the Zaldivars did
described a while ago, but I did not bother because I know that I not appear there; therefore, we hired a lawyer and filed this
can get that property because I own that property. case. 27
Q And the defendants constructed that house in 1974-75, am I Case law teaches that if the claimant's possession of the land is
correct? merely tolerated by its lawful owner, the latter's right to recover
A Yes. possession is never barred by laches:
Q And as a matter of fact, you have also a house very near to the As registered owners of the lots in question, the private
house that was constructed by the defendants in this case? respondents have a right to eject any person illegally occupying
A Yes. their property. This right is imprescriptible. Even if it be supposed
Q Can you tell us what is the distance between your house and that they were aware of the petitioner's occupation of the property,
the house constructed by the defendants in 1974? and regardless of the length of that possession, the lawful owners
A They are very near because they constructed their house in my have a right to demand the return of their property at any time as
lot. long as the possession was unauthorized or merely tolerated, if at
Q How many meters, more or less? all. This right is never barred by laches. 28
A It is very near, very close. Nonetheless, the Court is not unmindful of the fact that
Q When they constructed their house, meaning the defendants, respondents had built their house on the subject lot and, despite
did you not stop the defendants from the construction? knowledge thereof, Remegia did not lift a finger to prevent it.
A I did not bother in stopping the Zaldivars in constructing the Article 453 of the Civil Code is applicable to their case:
house because I am certain that I can get the land because I own ART. 453. If there was bad faith, not only on the part of the person
the land. who built, planted or sowed on the land of another, but also on the
Q Aside from not protesting to the construction, did you not bring part of the owner of such land, the rights of one and the other shall
this matter to the attention of the barangay captain or to the police be the same as though both had acted in good faith.
authorities?
A No, because I did not bring this matter to the barangay captain It is understood that there is bad faith on the part of the landowner
nor to the police authorities. It is only now that we discovered that whenever the act was done with his knowledge and without
it is already titled. opposition on his part.
Q When you said now, it is in 1992? Under the circumstances, respondents and Remegia are in mutual
A Yes. bad faith and, as such, would entitle the former to the application
Q Is it not a fact that after the house was finished the defendants of Article 448 of the Civil Code governing builders in good faith:
and their family resided in that house which they constructed? ART. 448. The owner of the land on which anything has been built,
A Yes, after the house was finished, they resided in that house. sown or planted in good faith, shall have the right to appropriate
Q As a matter of fact, from that time on up to the present, the as his own the works, sowing or planting, after payment of the
defendants are still residing in that house which they constructed indemnity provided for in Articles 546 29 and 548, 30 or to oblige
in 1974 or 1975, am I correct? the one who built or planted to pay the price of the land, and the
A Yes. one who sowed, the proper rent. However, the builder or planter
Q As a matter of fact also the defendants fenced the lot in which cannot be obliged to buy the land if its value is considerably more
their house was constructed with hollow blocks, am I correct? than that of the building or trees. In such a case, he shall pay
A Yes, the house of the Zaldivars was fenced by them with hollow reasonable rent, if the owner of the land does not choose to
blocks and I did not stop them to avoid trouble. appropriate the building or trees after the proper indemnity. The
Q As a matter of fact, the boundary between your house and the parties shall agree upon the terms of the lease and in case of
house of Zaldivar, there was constructed a firewall made of hollow disagreement, the court shall fix the terms thereof.
blocks about twelve feet in height, am I correct? Following the above provision, the owner of the land on which
A Yes. anything has been built, sown or planted in good faith shall have
Q Such that you cannot see their house and also the Zaldivars the right to appropriate as his own the building, planting or sowing,
cannot see your house because of that high firewall, am I correct? after payment to the builder, planter or sower of the necessary and
A We can still see each other because the firewall serves as the useful expenses, and in the proper case, expenses for pure luxury
wall of their house. or mere pleasure. 31
Q When did the Zaldivars construct that hollow blocks fence? After The owner of the land may also oblige the builder, planter or sower
the house was finished? to purchase and pay the price of the land. If the owner chooses to
A I cannot remember. sell his land, the builder, planter or sower must purchase the land,
Q But it could be long time ago? otherwise the owner may remove the improvements thereon. The
ATTY. VEDAD: builder, planter, or sower, however, is not obliged to purchase the
Q That would be repetitious. She answered she could not land if its value is considerably more than the building, planting or
remember. sowing. In such case, the builder, planter or sower must pay rent
ATTY. LEGASPI: to the owner of the land. If the parties cannot come to terms over
Q It could be many years ago? the conditions of the lease, the court must fix the terms thereof. 32
A I cannot remember when they constructed the fence. The right to choose between appropriating the improvement or
Q Did you [file] any protest or complaint when the Zaldivars selling the land on which the improvement of the builder, planter
constructed the hollow blocks fence? or sower stands, is given to the owner of the land, 33 Remegia, in
A No. this case, who is now substituted by petitioners as her heirs.
Q Neither did you bring any action in court or with the barangay Consequently, the petitioners are obliged to exercise either of the
captain or the police authorities when the Zaldivars constructed following options: (1) to appropriate the improvements, including
that hollow blocks fence? the house, built by the respondents on the subject lot by paying
A No, I did not complain the fencing by the Zaldivars. Only now the indemnity required by law, or (2) sell the subject lot to the
that we know that we bring this matter to the barangay captain. respondents. Petitioners cannot refuse to exercise either option
Q And in the [office of the] barangay captain, you were able to and compel respondents to remove their house from the
meet the defendants, am I correct? land. 34 In case petitioners choose to exercise the second option,
respondents are not obliged to purchase the subject lot if its value
is considerably more than the improvements thereon and in which
case, respondents must pay rent to petitioners. If they are unable dismissed because the judge found out that the titles were already
to agree on the terms of the lease, the court shall fix the terms registered under the names of respondent-spouses. 23
thereof. Unfazed by the unfortunate turn of events, petitioner, on July 27,
In light of the foregoing disquisition, the Court finds it unnecessary 2005, filed before Branch 18 of the RTC, Cagayan de Oro City, a
to resolve the procedural issues raised by petitioners. Complaint for Cancellation of Title, Recovery of Possession,
WHEREFORE, the petition is GRANTED. The Decision dated July Reconveyance and Damages, 24 docketed as Civil Case No.
31, 2003 and Resolution dated February 4, 2004 of the Court of 2005-158, against respondent-spouses and all persons claiming
Appeals in CA-G.R. CV No. 66511 are REVERSED and SET rights under them. Petitioner alleged that the transfer of the titles
ASIDE. The Decision dated December 3, 1999 of the Regional in the names of respondent-spouses was made only in compliance
Trial Court of Cagayan de Oro City, Branch 25 in Civil Case No. with the requirements of Capitol Development Bank and that
92-423 is REINSTATED with the MODIFICATION that petitioners respondent-spouses failed to pay their monthly amortizations
are likewise ordered to exercise the option under Article 448 of the beginning January 2000. 25 Thus, petitioner prayed that TCT Nos.
Civil Code. aDHCEA T-105202 and T-105203 be cancelled, and that respondent
SO ORDERED. Angeles be ordered to vacate the subject property and to pay
||| (Feliciano v. Spouses Zaldivar, G.R. No. 162593, [September petitioner reasonable monthly rentals from January 2000 plus
26, 2006], 534 PHIL 280-306) damages. 26
In her Answer, 27 respondent Angeles averred that the Deed of
COMMUNITY CAGAYAN INC v. NANOL Absolute Sale is valid, and that petitioner is not the proper party to
SECOND DIVISION file the complaint because petitioner is different from Masterplan
[G.R. No. 176791. November 14, 2012.] Properties, Inc. 28 She also prayed for damages by way of
COMMUNITIES CAGAYAN, INC., petitioner, vs. SPOUSES compulsory counterclaim. 29
ARSENIO (Deceased) and ANGELES NANOL AND ANYBODY In its Reply, 30 petitioner attached a copy of its Certificate of Filing
CLAIMING RIGHTS UNDER THEM,respondents. of Amended Articles of Incorporation 31 showing that Masterplan
DECISION Properties, Inc. and petitioner are one and the same. As to the
DEL CASTILLO, J p: compulsory counterclaim for damages, petitioner denied the same
Laws fill the gap in a contract. on the ground of "lack of knowledge sufficient to form a belief as
This Petition for Review on Certiorari 1 under Rule 45 of the Rules to the truth or falsity of such allegation." 32
of Court assails the December 29, 2006 Decision 2 and the Respondent Angeles then moved for summary judgment and
February 12, 2007 Order 3 of the Regional Trial Court prayed that petitioner be ordered to return the owner's duplicate
(RTC), Cagayan de Oro City, Branch 18, in Civil Case No. 2005- copies of the TCTs. 33
158. HSDaTC Pursuant to Administrative Order No. 59-2005, the case was
Factual Antecedents referred for mediation. 34 But since the parties failed to arrive at
Sometime in 1994, respondent-spouses Arsenio and an amicable settlement, the case was set for preliminary
Angeles Nanol entered into a Contract to Sell 4 with conference on February 23, 2006. 35
petitioner Communities Cagayan, Inc., 5 whereby the latter On July 7, 2006, the parties agreed to submit the case for decision
agreed to sell to respondent-spouses a house and Lots 17 and based on the pleadings and exhibits presented during the
19 6 located at Block 16, Camella Homes preliminary conference. 36
Subdivision, Cagayan de Oro City, 7 for the price of Ruling of the Regional Trial Court
P368,000.00. 8 Respondent-spouses, however, did not avail of On December 29, 2006, the RTC rendered judgment declaring the
petitioner's in-house financing due to its high interest Deed of Absolute Sale invalid for lack of consideration. 37 Thus, it
rates. 9 Instead, they obtained a loan from Capitol Development disposed of the case in this wise: SITCcE
Bank, a sister company of petitioner, using the property as WHEREFORE, the Court hereby declares the Deed of Absolute
collateral. 10 To facilitate the loan, a simulated sale over the Sale VOID. Accordingly, Transfer Certificate[s] of Title Nos.
property was executed by petitioner in favor of respondent- 105202 and 105203 in the names of the [respondents], Arsenio
spouses. 11 Accordingly, titles were transferred in the names of (deceased) and Angeles Nanol, are ordered CANCELLED. The
respondent-spouses under Transfer Certificates of Title (TCT) [respondents] and any person claiming rights under them are
Nos. 105202 and 105203, and submitted to Capitol Development directed to turn-over the possession of the house and lot to
Bank for loan processing. 12 Unfortunately, the bank collapsed [petitioner], Communities Cagayan, Inc., subject to the latter's
and closed before it could release the loan. 13 payment of their total monthly installments and the value of the
Thus, on November 30, 1997, respondent-spouses entered into new house minus the cost of the original house.
another Contract to Sell 14 with petitioner over the same property SO ORDERED. 38
for the same price of P368,000.00. 15 This time, respondent- Not satisfied, petitioner moved for reconsideration of the Decision
spouses availed of petitioner's in-house financing 16 thus, but the Motion 39 was denied in an Order 40 dated February 12,
undertaking to pay the loan over four years, from 1997 to 2001. 17 2007.
Sometime in 2000, respondent Arsenio demolished the original Issue
house and constructed a three-story house allegedly valued at Instead of appealing the Decision to the Court of Appeals (CA),
P3.5 million, more or less. 18 petitioner opted to file the instant petition directly with this Court on
In July 2001, respondent Arsenio died, leaving his wife, herein a pure question of law, to wit:
respondent Angeles, to pay for the monthly amortizations. 19 WHETHER . . . THE ACTION [OF] THE [RTC] BRANCH 18 . . . IN
On September 10, 2003, petitioner sent respondent-spouses a ORDERING THE RECOVERY OF POSSESSION BY
notarized Notice of Delinquency and Cancellation of Contract to PETITIONER 'subject to the latter's payment of their total monthly
Sell 20 due to the latter's failure to pay the monthly amortizations. installments and the value of the new house minus the cost of the
In December 2003, petitioner filed before Branch 3 of the original house' IS CONTRARY TO LAW AND JURISPRUDENCE
Municipal Trial Court in Cities of Cagayan de Oro City, an action . . . . 41
for unlawful detainer, docketed as C3-Dec-2160, against Petitioner's Arguments
respondent-spouses. 21 When the case was referred for Petitioner seeks to delete from the dispositive portion the order
mediation, respondent Angeles offered to pay P220,000.00 to requiring petitioner to reimburse respondent-spouses the total
settle the case but petitioner refused to accept the monthly installments they had paid and the value of the new house
payment. 22The case was later withdrawn and consequently minus the cost of the original house. 42 Petitioner claims that there
is no legal basis for the RTC to require petitioner to reimburse the contract by a notarial act and upon full payment of the cash
cost of the new house because respondent-spouses were in bad surrender value to the buyer.
faith when they renovated and improved the house, which was not Down payments, deposits or options on the contract shall be
yet their own. 43 Petitioner further contends that instead of included in the computation of the total number of installment
ordering mutual restitution by the parties, the RTC should have payments made. (Emphasis supplied.)
applied Republic Act No. 6552, otherwise known as the Maceda Section 4. In case where less than two years of installments were
Law, 44 and that instead of awarding respondent-spouses a paid, the seller shall give the buyer a grace period of not less than
refund of all their monthly amortization payments, the RTC should sixty days from the date the installment became due.
have ordered them to pay petitioner monthly rentals. 45 If the buyer fails to pay the installments due at the expiration of the
Respondent Angeles' Arguments grace period, the seller may cancel the contract after thirty days
Instead of answering the legal issue raised by petitioner, from receipt by the buyer of the notice of cancellation or the
respondent Angeles asks for a review of the Decision of the RTC demand for rescission of the contract by a notarial act.
by interposing additional issues. 46 She maintains that the Deed Section 5. Under Sections 3 and 4, the buyer shall have the right
of Absolute Sale is valid. 47 Thus, the RTC erred in cancelling to sell his rights or assign the same to another person or to
TCT Nos. 105202 and 105203. reinstate the contract by updating the account during the grace
Our Ruling period and before actual cancellation of the contract. The deed of
The petition is partly meritorious. sale or assignment shall be done by notarial act.
At the outset, we must make it clear that the issues raised by In this connection, we deem it necessary to point out that, under
respondent Angeles may not be entertained. For failing to file an the Maceda Law, the actual cancellation of a contract to sell takes
appeal, she is bound by the Decision of the RTC. Well entrenched place after 30 days from receipt by the buyer of the notarized
is the rule that "a party who does not appeal from a judgment can notice of cancellation, 50 and upon full payment of the cash
no longer seek modification or reversal of the same. He may surrender value to the buyer. 51 In other words, before a contract
oppose the appeal of the other party only on grounds consistent to sell can be validly and effectively cancelled, the seller has (1) to
with the judgment." 48 For this reason, respondent Angeles may send a notarized notice of cancellation to the buyer and (2) to
no longer question the propriety and correctness of the annulment refund the cash surrender value. 52 Until and unless the seller
of the Deed of Absolute Sale, the cancellation of TCT Nos. 105202 complies with these twin mandatory requirements, the contract to
and 105203, and the order to vacate the property. sell between the parties remains valid and subsisting. 53 Thus, the
Hence, the only issue that must be resolved in this case is whether buyer has the right to continue occupying the property subject of
the RTC erred in ordering petitioner to reimburse respondent- the contract to sell, 54 and may "still reinstate the contract by
spouses the "total monthly installments and the value of the new updating the account during the grace period and before the actual
house minus the cost of the original house." 49 Otherwise stated, cancellation" 55 of the contract.
the issues for our resolution are: In this case, petitioner complied only with the first condition by
1) Whether petitioner is obliged to refund to respondent-spouses sending a notarized notice of cancellation to the respondent-
all the monthly installments paid; and spouses. It failed, however, to refund the cash surrender value to
2) Whether petitioner is obliged to reimburse respondent-spouses the respondent-spouses. Thus, the Contract to Sell remains valid
the value of the new house minus the cost of the original house. and subsisting and supposedly, respondent-spouses have the
Respondent-spouses are entitled to the right to continue occupying the subject property. Unfortunately, we
cash surrender value of the payments cannot reverse the Decision of the RTC directing respondent-
on the property equivalent to 50% of the spouses to vacate and turn-over possession of the subject
total payments made. property to petitioner because respondent-spouses never
Considering that this case stemmed from a Contract to Sell appealed the order. The RTC Decision as to respondent-spouses
executed by the petitioner and the respondent-spouses, we agree is therefore considered final. ESCTaA
with petitioner that the Maceda Law, which governs sales of real In addition, in view of respondent-spouses' failure to appeal, they
estate on installment, should be applied. AHCaED can no longer reinstate the contract by updating the account.
Sections 3, 4, and 5 of the Maceda Law provide for the rights of a Allowing them to do so would be unfair to the other party and is
defaulting buyer, to wit: offensive to the rules of fair play, justice, and due process. Thus,
Section 3. In all transactions or contracts involving the sale or based on the factual milieu of the instant case, the most that we
financing of real estate on installment payments, including can do is to order the return of the cash surrender value. Since
residential condominium apartments but excluding industrial lots, respondent-spouses paid at least two years of installment, 56 they
commercial buildings and sales to tenants under Republic Act are entitled to receive the cash surrender value of the payments
Numbered Thirty-eight hundred forty-four, as amended by they had made which, under Section 3 (b) of the Maceda Law, is
Republic Act Numbered Sixty-three hundred eighty-nine, where equivalent to 50% of the total payments made.
the buyer has paid at least two years of installments, the buyer is Respondent-spouses are entitled to
entitled to the following rights in case he defaults in the payment reimbursement of the improvements
of succeeding installments: made on the property.
(a) To pay, without additional interest, the unpaid installments due Petitioner posits that Article 448 of the Civil Code does not apply
within the total grace period earned by him which is hereby fixed and that respondent-spouses are not entitled to reimbursement of
at the rate of one month grace period for every one year of the value of the improvements made on the property because they
installment payments made: Provided, That this right shall be were builders in bad faith. At the outset, we emphasize that the
exercised by the buyer only once in every five years of the life of issue of whether respondent-spouses are builders in good faith or
the contract and its extensions, if any. bad faith is a factual question, which is beyond the scope of a
(b) If the contract is canceled, the seller shall refund to the petition filed under Rule 45 of the Rules of Court. 57 In fact,
buyer the cash surrender value of the payments on the petitioner is deemed to have waived all factual issues since it
property equivalent to fifty percent of the total payments appealed the case directly to this Court, 58 instead of elevating the
made, and, after five years of installments, an additional five per matter to the CA. It has likewise not escaped our attention that
cent every year but not to exceed ninety per cent of the total after their failed preliminary conference, the parties agreed to
payments made: Provided, That the actual cancellation of the submit the case for resolution based on the pleadings and exhibits
contract shall take place after thirty days from receipt by the buyer presented. No trial was conducted. Thus, it is too late for petitioner
of the notice of cancellation or the demand for rescission of the to raise at this stage of the proceedings the factual issue of
whether respondent-spouses are builders in bad faith. Hence, in petitioners. In fact, because the children occupied the lots upon
view of the special circumstances obtaining in this case, we are their invitation, the parents certainly knew and approved of the
constrained to rely on the presumption of good faith on the part of construction of the improvements introduced thereon. Thus,
the respondent-spouses which the petitioner failed to rebut. Thus, petitioners may be deemed to have been in good faith when they
respondent-spouses being presumed builders in good faith, we built the structures on those lots.
now rule on the applicability of Article 448 of the Civil Code. The instant case is factually similar to Javier v. Javier. In that case,
As a general rule, Article 448 on builders in good faith does not this Court deemed the son to be in good faith for building the
apply where there is a contractual relation between the improvement (the house) with the knowledge and consent of his
parties, 59 such as in the instant case. We went over the records father, to whom belonged the land upon which it was built. Thus,
of this case and we note that the parties failed to attach a copy of Article 448 was applied. 65
the Contract to Sell. As such, we are constrained to apply Article In fine, the Court applied Article 448 by construing good faith
448 of the Civil Code, which provides viz.: beyond its limited definition. We find no reason not to apply the
ART. 448. The owner of the land on which anything has been built, Court's ruling in Spouses Macasaet v. Spouses Macasaet in this
sown or planted in good faith, shall have the right to appropriate case. We thus hold that Article 448 is also applicable to the instant
as his own the works, sowing or planting, after payment of the case. First, good faith is presumed on the part of the respondent-
indemnity provided for in Articles 546 and 548, or to oblige the one spouses. Second, petitioner failed to rebut this presumption. Third,
who built or planted to pay the price of the land, and the one who no evidence was presented to show that petitioner opposed or
sowed, the proper rent. However, the builder or planter cannot be objected to the improvements introduced by the respondent-
obliged to buy the land if its value is considerably more than that spouses. Consequently, we can validly presume that petitioner
of the building or trees. In such case, he shall pay reasonable rent, consented to the improvements being constructed. This
if the owner of the land does not choose to appropriate the building presumption is bolstered by the fact that as the subdivision
or trees after proper indemnity. The parties shall agree upon the developer, petitioner must have given the respondent-spouses
terms of the lease and in case of disagreement, the court shall fix permits to commence and undertake the construction. Under
the terms thereof. Article 453 of the Civil Code, "[i]t is understood that there is bad
Article 448 of the Civil Code applies when the builder believes that faith on the part of the landowner whenever the act was done with
he is the owner of the land or that by some title he has the right to his knowledge and without opposition on his part."
build thereon, 60 or that, at least, he has a claim of title In view of the foregoing, we find no error on the part of the RTC in
thereto. 61 Concededly, this is not present in the instant case. The requiring petitioner to pay respondent-spouses the value of the
subject property is covered by a Contract to Sell hence ownership new house minus the cost of the old house based on Article 448
still remains with petitioner being the seller. Nevertheless, there of the Civil Code, subject to succeeding discussions.
were already instances where this Court applied Article 448 even Petitioner has two options under Article
if the builders do not have a claim of title over the property. Thus: 448 and pursuant to the ruling in
This Court has ruled that this provision covers only cases in which Tuatis v. Escol. 66
the builders, sowers or planters believe themselves to be owners In Tuatis, we ruled that the seller (the owner of the land) has two
of the land or, at least, to have a claim of title thereto. It does not options under Article 448: (1) he may appropriate the
apply when the interest is merely that of a holder, such as a mere improvements for himself after reimbursing the buyer (the builder
tenant, agent or usufructuary. From these pronouncements, good in good faith) the necessary and useful expenses under Articles
faith is identified by the belief that the land is owned; or that by 546 67 and 548 68 of the Civil Code; or (2) he may sell the land to
some title one has the right to build, plant, or sow thereon. the buyer, unless its value is considerably more than that of the
However, in some special cases, this Court has used Article 448 improvements, in which case, the buyer shall pay reasonable
by recognizing good faith beyond this limited definition. Thus, rent. 69 Quoted below are the pertinent portions of our ruling in
in Del Campo v. Abesia, this provision was applied to one whose that case:
house despite having been built at the time he was still co- Taking into consideration the provisions of the Deed of Sale by
owner overlapped with the land of another. This article was also Installment and Article 448 of the Civil Code, Visminda has the
applied to cases wherein a builder had constructed improvements following options:
with the consent of the owner. The Court ruled that the law deemed Under the first option, Visminda may appropriate for herself the
the builder to be in good faith. In Sarmiento v. Agana, the builders building on the subject property after indemnifying Tuatis for
were found to be in good faith despite their reliance on the consent the necessary and useful expenses the latter incurred for said
of another, whom they had mistakenly believed to be the owner of building, as provided in Article 546 of the Civil Code.
the land. 62 It is worthy to mention that in Pecson v. Court of Appeals, the
The Court likewise applied Article 448 in Spouses Macasaet v. Court pronounced that the amount to be refunded to the
Spouses Macasaet 63 notwithstanding the fact that the builders builder under Article 546 of the Civil Code should be the
therein knew they were not the owners of the land. In said case, current market value of the improvement, thus:
the parents who owned the land allowed their son and his wife to xxx xxx xxx
build their residence and business thereon. As found by this Court, Until Visminda appropriately indemnities Tuatis for the building
their occupation was not by mere tolerance but "upon the invitation constructed by the latter, Tuatis may retain possession of the
of and with the complete approval of (their parents), who desired building and the subject property.
that their children would occupy the premises. It arose from familial Under the second option, Visminda may choose not to
love and a desire for family solidarity . . . ." 64 Soon after, conflict appropriate the building and, instead, oblige Tuatis to pay the
between the parties arose. The parents demanded their son and present or current fair value of the land. The P10,000.00 price
his wife to vacate the premises. The Court thus ruled that as of the subject property, as stated in the Deed of Sale on Installment
owners of the property, the parents have the right to possession executed in November 1989, shall no longer apply, since Visminda
over it. However, they must reimburse their son and his wife for will be obliging Tuatis to pay for the price of the land in the exercise
the improvements they had introduced on the property because of Visminda's rights under Article 448 of the Civil Code, and not
they were considered builders in good faith even if they knew for under the said Deed. Tuatis' obligation will then be statutory, and
a fact that they did not own the property, thus: CSaITD not contractual, arising only when Visminda has chosen her option
Based on the aforecited special cases, Article 448 applies to the under Article 448 of the Civil Code. TcCDIS
present factual milieu. The established facts of this case show that Still under the second option, if the present or current value of
respondents fully consented to the improvements introduced by the land, the subject property herein, turns out to be
considerably more than that of the building built thereon, In view of the foregoing disquisition and in accordance
Tuatis cannot be obliged to pay for the subject property, but with Depra v. Dumlao 72 and Technogas Philippines
she must pay Visminda reasonable rent for the same. Manufacturing Corporation v. Court of Appeals, 73 we find it
Visminda and Tuatis must agree on the terms of the lease; necessary to remand this case to the court of origin for the purpose
otherwise, the court will fix the terms. of determining matters necessary for the proper application of
Necessarily, the RTC should conduct additional proceedings Article 448, in relation to Articles 546 and 548 of the Civil
before ordering the execution of the judgment in Civil Case No. S- Code.DHTCaI
618. Initially, the RTC should determine which of the WHEREFORE, the petition is hereby PARTIALLY GRANTED.
aforementioned options Visminda will choose. Subsequently, the The assailed Decision dated December 29, 2006 and the Order
RTC should ascertain: (a) under the first option, the amount of dated February 12, 2007 of the Regional Trial Court, Cagayan de
indemnification Visminda must pay Tuatis; or (b) under the second Oro City, Branch 18, in Civil Case No. 2005-158 are
option, the value of the subject property vis- -vis that of the hereby AFFIRMED with MODIFICATION that
building, and depending thereon, the price of, or the reasonable petitioner Communities Cagayan, Inc. is hereby ordered
rent for, the subject property, which Tuatis must pay Visminda. to RETURN the cash surrender value of the payments made by
The Court highlights that the options under Article 448 are respondent-spouses on the properties, which is equivalent to 50%
available to Visminda, as the owner of the subject property. There of the total payments made, in accordance with Section 3 (b)
is no basis for Tuatis' demand that, since the value of the building of Republic Act No. 6552, otherwise known as the Maceda Law.
she constructed is considerably higher than the subject property, The case is hereby REMANDED to the Regional Trial
she may choose between buying the subject property from Court, Cagayan de Oro City, Branch 18, for further proceedings
Visminda and selling the building to Visminda for P502,073.00. consistent with the proper application of Articles 448, 546 and 548
Again, the choice of options is for Visminda, not Tuatis, to make. of the Civil Code, as follows:
And, depending on Visminda's choice, Tuatis' rights as a builder 1. The trial court shall determine:
under Article 448 are limited to the following: (a) under the first a) the present or current fair value of the lots;
option, a right to retain the building and subject property until b) the current market value of the new house;
Visminda pays proper indemnity; and (b) under the second option, c) the cost of the old house; and
a right not to be obliged to pay for the price of the subject property, d) whether the value of the lots is considerably more than the
if it is considerably higher than the value of the building, in which current market value of the new house minus the cost of the old
case, she can only be obliged to pay reasonable rent for the same. house.
The rule that the choice under Article 448 of the Civil 2. After said amounts shall have been determined by competent
Code belongs to the owner of the land is in accord with the evidence, the trial court shall render judgment as follows:
principle of accession, i.e., that the accessory follows the principal a) Petitioner shall be granted a period of 15 days within which to
and not the other way around. Even as the option lies with the exercise its option under the law (Article 448, Civil Code), whether
landowner, the grant to him, nevertheless, is preclusive. The to appropriate the new house by paying to respondent Angeles the
landowner cannot refuse to exercise either option and compel current market value of the new house minus the cost of the old
instead the owner of the building to remove it from the land. house, or to oblige respondent Angeles to pay the price of the lots.
The raison d'etre for this provision has been enunciated thus: The amounts to be respectively paid by the parties, in accordance
Where the builder, planter or sower has acted in good faith, a with the option thus exercised by written notice to the other party
conflict of rights arises between the owners, and it becomes and to the court, shall be paid by the obligor within 15 days from
necessary to protect the owner of the improvements without such notice of the option by tendering the amount to the trial court
causing injustice to the owner of the land. In view of the in favor of the party entitled to receive it.
impracticability of creating a state of forced co-ownership, the law b) If petitioner exercises the option to oblige respondent Angeles
has provided a just solution by giving the owner of the land the to pay the price of the lots but the latter rejects such purchase
option to acquire the improvements after payment of the proper because, as found by the trial court, the value of the lots is
indemnity, or to oblige the builder or planter to pay for the land and considerably more than the value of the new house minus the cost
the sower the proper rent. He cannot refuse to exercise either of the old house, respondent Angeles shall give written notice of
option. It is the owner of the land who is authorized to exercise the such rejection to petitioner and to the trial court within 15 days from
option, because his right is older, and because, by the principle of notice of petitioner's option to sell the land. In that event, the
accession, he is entitled to the ownership of the accessory thing. parties shall be given a period of 15 days from such notice of
Visminda's Motion for Issuance of Writ of Execution cannot be rejection within which to agree upon the terms of the lease, and
deemed as an expression of her choice to recover possession of give the trial court formal written notice of the agreement and
the subject property under the first option, since the options its provisos. If no agreement is reached by the parties, the trial
under Article 448 of the Civil Code and their respective court, within 15 days from and after the termination of the said
consequences were also not clearly presented to her by the period fixed for negotiation, shall then fix the period and terms of
19 April 1999 Decision of the RTC. She must then be given the the lease, including the monthly rental, which shall be payable
opportunity to make a choice between the options available within the first five days of each calendar month. Respondent
to her after being duly informed herein of her rights and Angeles shall not make any further constructions or improvements
obligations under both. 70 (Emphasis supplied.) on the building. Upon expiration of the period, or upon default by
In conformity with the foregoing pronouncement, we hold that respondent Angeles in the payment of rentals for two consecutive
petitioner, as landowner, has two options. It may appropriate the months, petitioner shall be entitled to terminate the forced lease,
new house by reimbursing respondent Angeles the current market to recover its land, and to have the new house removed by
value thereof minus the cost of the old house. Under this option, respondent Angeles or at the latter's expense.
respondent Angeles would have "a right of retention which negates c) In any event, respondent Angeles shall pay petitioner
the obligation to pay rent." 71 In the alternative, petitioner may sell reasonable compensation for the occupancy of the property for the
the lots to respondent Angeles at a price equivalent to the current period counted from the time the Decision dated December 29,
fair value thereof. However, if the value of the lots is considerably 2006 became final as to respondent Angeles or 15 days after she
more than the value of the improvement, respondent Angeles received a copy of the said Decision up to the date petitioner
cannot be compelled to purchase the lots. She can only be obliged serves notice of its option to appropriate the encroaching
to pay petitioner reasonable rent. structures, otherwise up to the actual transfer of ownership to
respondent Angeles or, in case a forced lease has to be imposed,
up to the commencement date of the forced lease referred to in National Bank the amount ofP19,246.58 representing the
the preceding paragraph. provisional value thereof. 5
d) The periods to be fixed by the trial court in its decision shall be On 31 October 1995, respondents filed their Answer with
non-extendible, and upon failure of the party obliged to tender to Affirmative and Special Defenses and Counterclaim. 6 They
the trial court the amount due to the obligee, the party entitled to alleged, inter alia, that NIA had no authority to expropriate
such payment shall be entitled to an order of execution for the portions of their land, because it was not a sovereign political
enforcement of payment of the amount due and for compliance entity; that it was not necessary to expropriate their properties,
with such other acts as may be required by the prestation due the because there was an abandoned government property adjacent
obligee. ETHSAI to theirs, where the project could pass through; that Lot No. 3080
SO ORDERED. was no longer owned by the Rural Bank of Kabacan; that NIA's
||| (Communities Cagayan, Inc. v. Spouses Nanol, G.R. No. valuation of their expropriated properties was inaccurate
176791, [November 14, 2012], 698 PHIL 648-669) because of the improvements on the land that should have placed
its value at P5 million; and that NIA never negotiated with the
REPUBLIC v. RURAL BANK OF KABACAN landowners before taking their properties for the project, causing
SECOND DIVISION permanent and irreparable damages to their properties valued at
[G.R. No. 185124. January 25, 2012.] P250,000. 7
REPUBLIC OF THE PHILIPPINES, represented by the On 11 September 1996, the RTC issued an Order forming a
NATIONAL IRRIGATION ADMINISTRATION committee tasked to determine the fair market value of the
(NIA), petitioner, vs. RURAL BANK OF KABACAN, INC., expropriated properties to establish the just compensation to be
LITTIE SARAH A. AGDEPPA, LEOSA NANETTE AGDEPPA paid to the owners. The committee was composed of the
and MARCELINO VIERNES, MARGARITA TABOADA, PORTIA Clerk of Court of RTC Branch 22 as chairperson and two (2)
CHARISMA RUTH ORTIZ, represented by LINA ERLINDA A. members of the parties to the case. 8
ORTIZ and MARIO ORTIZ, JUAN MAMAC and GLORIA On 20 September 1996, in response to the expropriation
MATAS, respondents. Complaint, respondents-intervenors Margarita Tabaoda, Portia
DECISION Charisma Ruth Ortiz, Lina Erlinda Ortiz, Mario Ortiz, Juan Mamac
SERENO, J p: and Gloria Matas filed their Answer-in-Intervention with Affirmative
Before the Court is a Petition for Review on Certiorari under Rule and Special Defenses and Counter-Claim. They essentially
45 of the Rules of Court, seeking the reversal of the 12 August adopted the allegations in the Answer of the other respondents
2008 Court of Appeals (CA) Decision and 22 October 2008 and pointed out that Margarita Tabaoda and Portia Charisma Ruth
Resolution in CA-G.R. CV No. 65196. Ortiz were the new owners of Lot No. 3080, which the two
The assailed issuances affirmed with modification the 31 August acquired from the RuralBank of Kabacan. They further alleged
1999 "Judgment" promulgated by the Regional Trial Court (RTC), that the four other respondents-intervenors were joint tenants-
Branch 22, Judicial Region, Kabacan, Cotabato. The RTC had cultivators of Lot Nos. 3080 and 3039. 9 TIEHSA
fixed the just compensation for the value of the land and On 10 October 1996, the lower court issued an Order stating it
improvements thereon that were expropriated by petitioner, but would issue a writ of possession in favor of NIA upon the
excluded the value of the excavated soil. determination of the fair market value of the properties,
Petitioner Republic of the Philippines is represented in this case subject of the expropriation proceedings. 10 The lower court later
by the National Irrigation Authority (NIA). amended its ruling and, on 21 October 1996, issued a
The Facts Writ of Possession in favor of NIA. 11
NIA is a government-owned-and-controlled corporation created On 15 October 1996, the committee submitted a Commissioners'
under Republic Act No. (R.A.) 3601 on 22 June 1963. It is primarily Report 12 to the RTC stating the following observations:
responsible for irrigation development and management in the In the process of ocular inspection, the following were jointly
country. Its charter was amended by Presidential Decree (P.D.) observed:
552 on 11 September 1974 and P.D. 1702 on 17 July 1980. To 1) The area that was already occupied is 6x200 meters which is
carry out its purpose, NIA was specifically authorized under P.D. equivalent to 1,200 square meters;
552 to exercise the power of eminent domain. 1 2) The area which is to be occupied is 18,930 square meters, more
NIA needed some parcels of land for the purpose of constructing or less;
the Malitubog-Marigadao Irrigation Project. On 08 September 3) That the area to be occupied is fully planted by gmelina trees
1994, it filed with the RTC of Kabacan, Cotabato a Complaint for with a spacing of 1x1 meters;
the expropriation of a portion of three (3) parcels of land covering 4) That the gmelina tress found in the area already occupied and
a total of 14,497.91 square meters. 2 The case was docketed as used for [the] road is planted with gmelina with spacing of 2x2 and
Special Civil Case No. 61 and was assigned to RTC-Branch 22. more or less one (1) year old;
The affected parcels of land were the following: ESTCHa 5) That the gmelina trees found in the area to be occupied are
1) Lot No. 3080 covered by Transfer Certificate of Title (TCT) already four (4) years old;
No. T-61963 and registered under the Rural Bank of Kabacan 6) That the number of banana clumps (is) two hundred twenty
2) Lot No. 455 covered by TCT No. T-74516 and registered (220);
under the names of RG May, Ronald and Rolando, all surnamed 7) That the number of coco trees found (is) fifteen (15). 13
Lao The report, however, stated that the committee members could not
3) Lot No. 3039 registered under the name of Littie Sarah agree on the market value of the subject properties and
Agdeppa 3 recommended the appointment of new independent
On 11 July 1995, NIA filed an Amended Complaint to include commissioners to replace the ones coming from the parties
Leosa Nanette A. Agdeppa and Marcelino Viernes as registered only. 14 On 22 October 1996, the RTC issued an
owners of Lot No. 3039. 4 Order 15 revoking the appointments of Atty. Agdeppa and Engr.
On 25 September 1995, NIA filed a Second Amended Complaint Mabang as members of the committee and, in their stead,
to allege properly the area sought to be expropriated, the exact appointed Renato Sambrano, Assistant Provincial Assessor of the
address of the expropriated properties and the owners thereof. Province of Cotabato; and Jack Tumacmol, Division Chief of the
NIA further prayed that it be authorized to take immediate Land Bank of the Philippines-Kidapawan Branch. 16 DCcHAa
possession of the properties after depositing with the Philippine On 25 November 1996, the new committee submitted its
Commissioners' Report to the lower court. The committee had
agreed that the fair market value of the land to be expropriated trees, their productivity and the inputs made. 25 The appellate
should be P65 per square meter based on the zonal court further noted that despite the Manifestation of NIA that it be
valuation of the Bureau of Internal Revenue (BIR). As regards the allowed to present evidence to rebut the recommendation of the
improvement on the properties, the report recommended the committee on the valuations of the expropriated properties, NIA
following compensation: failed to do so. 26
a. P200 for each gmelina tree that are more than four (4) years old The assailed CA Decision, however, deleted the inclusion of the
b. P150 for each gmelina tree that are more than one (1) year old value of the soil excavated from the properties in the just
c. P164 for each coco tree compensation. It ruled that the property owner was entitled to
d. P270 for each banana clump 17 compensation only for the value of the property at the time of the
On 03 December 1997, the committee submitted to the RTC taking. 27 In the construction of irrigation projects, excavations
another report, which had adopted the first Committee Report, as are necessary to build the canals, and the excavated soil cannot
well as the former's 25 November 1996 report. However, the be valued separately from the land expropriated. Thus, it
committee added to its computation the value of the earthfill concluded that NIA, as the new owner of the affected properties,
excavated from portions of Lot Nos. 3039 and 3080. 18 Petitioner had the right to enjoy and make use of the property, including the
objected to the inclusion ofthe value of the excavated soil in the excavated soil, pursuant to the latter's objectives. 28 CaAcSE
computation of the value of the land. 19 Finally, the CA affirmed the trial court's ruling that recognized
The Ruling of the Trial Court defendants-intervenors Margarita Tabaoda and Portia Charisma
On 31 August 1999, the RTC promulgated its "Judgment," 20 the Ruth Ortiz as the new owners of Lot No. 3080 and held that they
dispositive portion of which reads: were thus entitled to just compensation. The appellate court based
WHEREFORE, IN VIEW of all the foregoing considerations, the its conclusion on the non-participation by
court finds and so holds that the commissioners have arrived at the Rural Bank of Kabacan in the expropriation proceedings and
and were able to determine the fair market value ofthe properties. the latter's Manifestation that it no longer owned Lot No. 3080. 29
The court adopts their findings, and orders: On 11 September 2008, the NIA through the OSG filed a Motion
1. That 18,930 square meters of the lands owned by the for Reconsideration of the 12 August 2008 Decision, but that
defendants is hereby expropriated in favor of the Republic of the motion was denied. 30
Philippines through the National Irrigation Administration; Aggrieved by the appellate court's Decision, NIA now comes to
2. That the NIA shall pay to the defendants the this Court via a Petition for Review on Certiorari under Rule 45.
amount of P1,230,450 for the 18,930 square meters expropriated The Issues
in proportion to the areas so expropriated; The following are the issues proffered by petitioner:
3. That the NIA shall pay to the defendant-intervenors, THE COURT OF APPEALS SERIOUSLY ERRED IN AFFIRMING
owners of Lot No. 3080, the sum of P5,128,375.50, representing THE TRIAL COURT'S FINDING OF JUST
removed earthfill; TACEDI COMPENSATION OF THE LAND AND THE IMPROVEMENTS
4. That the NIA shall pay to the defendants, owners of Lot No. THEREON BASED ON THE REPORT OF THE
3039, the sum of P1,929,611.30 representing earthfill; COMMISSIONERS.
5. To pay to the defendants the sum of P60,000 for the destroyed THE COURT OF APPEALS ERRED IN RULING THAT THE
G-melina trees (1 year old); PAYMENT OF JUST COMPENSATION FOR LOT NO. 3080
6. To pay to the defendants the sum of P3,786,000.00 for the 4- SHOULD BE MADE TO RESPONDENTS MARGARITA
year old G-melina trees; TABOADA AND PORTIA CHARISMA RUTH ORTIZ. 31
7. That NIA shall pay to the defendants the sum of P2,460.00 for The Court's Ruling
the coconut trees; On the first issue, the Petition is not meritorious.
8. That all payments intended for the In expropriation proceedings, just compensation is defined as the
defendant Rural Bank of Kabacan shall be given to the full and fair equivalent of the property taken from its owner by the
defendants and intervenors who have already acquired ownership expropriator. The measure is not the taker's gain, but the owner's
over the land titled in the name of the Bank. 21 loss. The word "just" is used to intensify the meaning of the word
NIA, through the Office of the Solicitor General (OSG), appealed "compensation" and to convey thereby the idea that the equivalent
the Decision of the RTC to the CA, which docketed the case as to be rendered for the property to be taken shall be real,
CA-G.R. CV No. 65196. NIA assailed the trial court's substantial, full and ample. 32 The constitutional limitation of "just
adoption of the Commissioners' Report, which had determined the compensation" is considered to be a sum equivalent to the market
just compensation to be awarded to the owners of the lands value of the property, broadly defined as the price fixed by the
expropriated. NIA also impugned as error the RTC's inclusion for seller in open market in the usual and ordinary course of legal
compensation of the excavated soil from the expropriated action and competition; or the fair value of the property; as
properties. Finally, it disputed the trial court's Order to deliver the between one who receives and one who desires to sell it, fixed at
payment intended for the Rural Bank of Kabacan to defendants- the time of the actual taking by the government. 33
intervenors, who allegedly acquired ownership of the land still In the instant case, we affirm the appellate court's ruling that the
titled in the name of the said rural bank. 22 commissioners properly determined the just compensation to be
The Ruling of the Court of Appeals awarded to the landowners whose properties were expropriated
On 12 August 2008, the CA through its Twenty-First (21st) by petitioner. TEHDIA
Division, promulgated a Decision 23 affirming with modification The records show that the trial court dutifully followed the
the RTC Decision. It ruled that the committee tasked to determine procedure under Rule 67 of the 1997 Rules of Civil
the fair market value of the properties and improvements for the Procedure when it formed a committee that was tasked to
purpose of arriving at the just compensation, properly performed determine the just compensation for the expropriated properties.
its function. The appellate court noted that the committee The first set of committee members made an ocular
members had conducted ocular inspections of the area inspection of the properties, subject of the expropriation. They
surrounding the expropriated properties and made their also determined the exact areas affected, as well as the kinds and
recommendations based on official documents from the BIR with the number of improvements on the properties. 34 When the
regard to the zonal valuations of the affected properties. 24 The members were unable to agree on the valuation of the land and
CA observed that, as far as the valuation of the improvements on the improvements thereon, the trial court selected another
the properties was concerned, the committee members took into batch of disinterested members to carry out the
consideration the provincial assessor's appraisal of the age of the task of determining the value of the land and the improvements.
The new committee members even made a second ocular however. The issue raised by petitioner was adequately addresses
inspection of the expropriated areas. They also obtained data from by the CA's assailed Decision in this wise:
the BIR to determine the zonal valuation ofthe expropriated A thorough scrutiny of the records reveals that the second
properties, interviewed the adjacent property owners, and set of Commissioners, with Atty. Marasigan still being the
considered other factors such as distance from the highway and Chairperson and Mr. Zambrano and Mr. Tomacmol as members,
the nearby town center. 35 Further, the committee members also was not arbitrary and capricious in performing the task assigned
considered Provincial Ordinance No. 173, which was promulgated to them. We note that these Commissioners were competent and
by the Province of Cotabato on 15 June 1999, and which provide disinterested persons who were handpicked by the court a
for the value ofthe properties and the improvements for taxation quo due to their expertise in appraising the value of the land and
purposes. 36 the improvements thereon in the province of Cotabato. They made
We can readily deduce from these established facts that the a careful study ofthe area affected by the expropriation,
committee members endeavored a rigorous process to determine mindful of the fact that the value of the land and its may be
the just compensation to be awarded to the owners of the affected by many factors. The duly appointed Commissioners
expropriated properties. We cannot, as petitioner would want us made a second ocular inspection of the subject area on 4
to, oversimplify the process undertaken by the committee in September 1997; went to the BIR office in order to get the BIR
arriving at its recommendations, because these were not based on zonal valuation of the properties located in Carmen, Cotabato;
mere conjectures and unreliable data. interviewed adjacent property owners; and took into consideration
In National Power Corporation v. Diato-Bernal, 37 this Court various factors such as the location of the land which is just less
emphasized that the "just"-ness of the compensation could only be than a kilometer away from the Poblacion and half a kilometer
attained by using reliable and actual data as bases for fixing the away from the highway and the fact that it is near a military
value of the condemned property. The reliable and actual data we reservation. With regard to the improvements, the Commissioners
referred to in that case were the sworn declarations of realtors in took into consideration the valuation of the Provincial Assessor,
the area, as well as tax declarations and zonal valuation from the the age of the trees, and the inputs and their productivity.
BIR. In disregarding the Committee Report assailed by the Thus, it could not be said that the schedule of market values in
National Power Corporation in the said case, we ruled thus: Ordinance No. 173 was the sole basis of the Commissioners in
It is evident that the above conclusions are highly speculative and arriving at their valuation. Said ordinance merely gave credence to
devoid of any actual and reliable basis. First, the market their valuation which is comparable to the current price at that time.
values of the subject property's neighboring lots were mere Besides, Mr. Zambrano testified that the date used as bases for
estimates and unsupported by any corroborative documents, such Ordinance No. 173 were taken from 1995 to 1996. 41
as sworn declarations of realtors in the area concerned, tax Moreover, factual findings of the CA are generally binding on this
declarations or zonal valuation from the Bureau of Internal Court. The rule admits of exceptions, though, such as when the
Revenue for the contiguous residential dwellings and commercial factual findings of the appellate court and the trial court are
establishments. The report also failed to elaborate on how and by contradictory, or when the findings are not supported by the
how much the community centers and convenience facilities evidence on record. 42 These exceptions, however, are not
enhanced the value of respondent's property. Finally, the market present in the instant case. DTIaCS
sales data and price listings alluded to in the report were not even Thus, in the absence of contrary evidence, we affirm the
appended thereto. findings of the CA, which sustained the trial court's Decision
As correctly invoked by NAPOCOR, a commissioners' adopting the committee's recommendations on the just
report of land prices which is not based on any documentary compensation to be awarded to herein respondents.
evidence is manifestly hearsay and should be disregarded by the We also uphold the CA ruling, which deleted the inclusion of the
court. ETAICc value of the excavated soil in the payment for just compensation.
The trial court adopted the flawed findings of the commissioners There is no legal basis to separate the value of the excavated soil
hook, line, and sinker. It did not even bother to require the from that of the expropriated properties, contrary to what the trial
submission of the alleged "market sales data" and "price listings." court did. In the context of expropriation proceedings, the soil has
Further, the RTC overlooked the fact that the recommended just no value separate from that of the expropriated land. Just
compensation was gauged as of September 10, 1999 or more compensation ordinarily refers to the value of the land to
than two years after the complaint was filed on January 8, 1997. It compensate for what the owner actually loses. Such value could
is settled that just compensation is to be ascertained as of the only be that which prevailed at the time of the taking.
time of the taking, which usually coincides with the In National Power Corporation v. Ibrahim, et al., 43 we held that
commencement of the expropriation proceedings. Where the rights over lands are indivisible, viz.:
institution of the action precedes entry into the property, the just [C]onsequently, the CA's findings which upheld those of the trial
compensation is to be ascertained as of the time of the filing of the court that respondents owned and possessed the property and
complaint. Clearly, the recommended just compensation in the that its substrata was possessed by petitioner since 1978 for the
commissioners' report is unacceptable. 38 underground tunnels, cannot be disturbed. Moreover, the Court
In the instant case, the committee members based their sustains the finding of the lower courts that the sub-terrain
recommendations on reliable data and, as aptly noted by the portion of the property similarly belongs to respondents. This
appellate court, considered various factors that affected the conclusion is drawn from Article 437 of the Civil Code which
value of the land and the improvements. 39 provides:
Petitioner, however, strongly objects to the CA's affirmation of the ART. 437. The owner of a parcel of land is the owner of its surface
trial court's adoption of Provincial Ordinance No. 173. The OSG, and of everything under it, and he can construct thereon any works
on behalf of petitioner, strongly argues that the or make any plantations and excavations which he may deem
recommendations of the committee formed by the trial court were proper, without detriment to servitudes and subject to special laws
inaccurate. The OSG contends that the ordinance reflects the and ordinances. He cannot complain of the reasonable
1999 market values of real properties in the Province of Cotabato, requirements of aerial navigation.
while the actual taking was made in 1996. 40 Thus, the ownership of land extends to the surface as well as to
We are not persuaded. the subsoil under it.
We note that petitioner had ample opportunity to rebut the xxx xxx xxx
testimonial, as well as documentary evidence presented by Registered landowners may even be ousted of ownership and
respondents when the case was still on trial. It failed to do so, possession of their properties in the event the latter are
reclassified as mineral lands because real properties are intended to be awarded solely owner based on the latter's
characteristically indivisible. For the loss sustained by such proof of ownership. IATSHE
owners, they are entitled to just compensation under the Mining The trial court should have been guided by Rule 67, Section
Laws or in appropriate expropriation proceedings. 9 of the 1997 Rules of Court, which provides thus:
Moreover, petitioner's argument that the landowners' right extends SEC. 9. Uncertain ownership; conflicting claims. If the
to the sub-soil insofar as necessary for their practical interests ownership of the property taken is uncertain, or there are
serves only to further weaken its case. The theory would limit the conflicting claims to any part thereof, the court may order any sum
right to the sub-soil upon the economic utility which such area or sums awarded as compensation for the property to be paid to
offers to the surface owners. Presumably, the landowners' right the court for the benefit of the person adjudged in the same
extends to such height or depth where it is possible for them to proceeding to be entitled thereto. But the judgment shall require
obtain some benefit or enjoyment, and it is extinguished beyond the payment of the sum or sums awarded to either the defendant
such limit as there would be no more interest protected by or the court before the plaintiff can enter upon the property, or
law. HEScID retain it for the public use or purpose if entry has already been
Hence, the CA correctly modified the trial court's Decision when it made.
ruled thus: Hence, the appellate court erred in affirming the trial court's Order
We agree with the OSG that NIA, in the construction of irrigation to award payment of just compensation to the defendants-
projects, must necessarily make excavations in order to build the intervenors. There is doubt as to the real owner of Lot No. 3080.
canals. Indeed it is preposterous that NIA will be made to pay not Despite the fact that the lot was covered by TCT No. T-61963 and
only for the value of the land but also for the soil excavated from was registered under its name,
such land when such excavation is a necessary phase in the the Rural Bank of Kabacan manifested that the owner ofthe lot
building of irrigation projects. That NIA will make use of the was no longer the bank, but the defendants-intervenors; however,
excavated soil is of no moment and is of no concern to the it presented no proof as to the conveyance thereof. In this regard,
landowner who has been paid the fair market value of his land. As we deem it proper to remand this case to the trial court for the
pointed out by the OSG, the law does not limit the use of the reception of evidence to establish the present owner of Lot No.
expropriated land to the surface area only. Further, NIA, now being 3080 who will be entitled to receive the payment of just
the owner of the expropriated property, has the right to enjoy and compensation.
make use of the property in accordance with its mandate and WHEREFORE, the Petition is PARTLY GRANTED. The 12
objectives as provided by law. To sanction the payment of the August 2008 CA Decision in CA-G.R. CV No. 65196, awarding just
excavated soil is to allow the landowners to recover more than the compensation to the defendants as owners of the expropriated
value of the land at the time when it was taken, which is the true properties and deleting the inclusion of the value of the excavated
measure of the damages, or just compensation, and would soil, is hereby AFFIRMED with MODIFICATION. The case is
discourage the construction ofimportant public improvements. 44 hereby REMANDED to the trial court for the reception of evidence
On the second issue, the Petition is meritorious. to establish the present owner of Lot No. 3080. No
The CA affirmed the ruling of the trial court, which had awarded pronouncements as to cost.
the payment of just compensation intended for Lot No. 3080 SO ORDERED.
registered in the name of the Rural Bank ofKabacan to the ||| (Republic v. Rural Bank of Kabacan, Inc., G.R. No. 185124,
defendants-intervenors on the basis of the non- [January 25, 2012], 680 PHIL 247-265)
participation of the rural bank in the proceedings and the latter's
subsequent Manifestation that it was no longer the owner of that MANILA ELECTRIC COMPANY v. CITY ASSESSOR
lot. The appellate court erred on this matter. FIRST DIVISION
It should be noted that eminent domain cases involve the [G.R. No. 166102. August 5, 2015.]
expenditure of public funds. 45 In this kind of proceeding, we MANILA ELECTRIC COMPANY, petitioner, vs. THE CITY ASS
require trial courts to be more circumspect in their evaluation of the ESSOR and CITY TREASURER OF
just compensation to be awarded to the owner of the expropriated LUCENA CITY, respondents.
property. 46 Thus, it was imprudent for the appellate court to rely DECISION
on the Rural Bank ofKabacan's mere declaration of non- LEONARDO-DE CASTRO, J p:
ownership and non-participation in the expropriation proceeding to Before the Court is a Petition for Review on Certiorari under Rule
validate defendants-intervenors' claim of entitlement to that 45 of the Rules of Court filed
payment. by Manila Electric Company (MERALCO), seeking the reversal of
The law imposes certain legal requirements in order for a the Decision 1dated May 13, 2004 and Resolution 2 dated
conveyance of real property to be valid. It should be noted that Lot November 18, 2004 of the Court of Appeals in CA-G.R. SP No.
No. 3080 is a registered parcel of land covered by TCT No. T- 67027. The appellate court affirmed the Decision 3 dated May 3,
61963. In order for the reconveyance of real property to be valid, 2001 of the Central Board of Assessment Appeals (CBAA) in
the conveyance must be embodied in a public document 47 and CBAA Case No. L-20-98, which, in turn, affirmed with modification
registered in the office of the Register of Deeds where the the Decision 4 dated June 17, 1998 5 of the Local Board of
property is situated. 48 Assessment Appeals (LBAA) of Lucena City, Quezon Province, as
We have scrupulously examined the records of the case and regards Tax Declaration Nos. 019-6500 and 019-7394, ruling that
found no proof of conveyance or MERALCO is liable for real property tax on its
evidence of transfer of ownership of Lot No. 3080 from its transformers, electric posts (or poles), transmission lines,
registered owner, the Rural Bank of Kabacan, to defendants- insulators, and electric meters, beginning 1992.
intervenors. As it is, the TCT is still registered in the name of the MERALCO is a private corporation organized and existing under
said rural bank. It is not disputed that the bank did not participate Philippine laws to operate as a public utility engaged
in the expropriation proceedings, and that it manifested that it no in electric distribution. MERALCO has been successively granted
longer owned Lot No. 3080. The trial court should have franchises to operate in Lucena City beginning 1922 until present
nevertheless required the rural bank and the defendants- time, particularly, by: (1) Resolution No. 36 6 dated May 15, 1922
intervenors to show proof or evidence pertaining to the of the Municipal Council of Lucena; (2) Resolution No. 108 7 dated
conveyance of the subject lot. The court cannot rely on mere July 1, 1957 of the Municipal Council of Lucena; (3) Resolution No.
inference, considering that the payment of just compensation is 2679 8 dated June 13, 1972 of the Municipal Board of
Lucena City; 9 (4) Certificate of Franchise 10 dated October 28,
1993 issued by the National Electrification Commission; and 019
(5) Republic Act No. 9209 11 approved on June 9, 2003 by - P65,448,800 P3,272,440 P2,356,156 P5,628,596.8
1990-94
Congress. 12 650 .00 .00 .80 0
On February 20, 1989, MERALCO received from 0
the City Assessor of Lucena a copy of Tax Declaration No. 019- 019
6500 13 covering the following electric facilities, classified as - 78,538,560.0
1995 785,385.60 534,062.21 1,319,447.81
capital investment, of the company: (a) transformer 739 0
and electric post; (b) transmission line; (c) insulator; and 4
(d) electric meter, located in Quezon Ave. Ext., Brgy. Gulang-
1996 785,385.60 345,569.66 1,130,955.26
Gulang, Lucena City. Under Tax Declaration No. 019-6500,
these electric facilities had a market value of P81,811,000.00 and 1st-
589,039.20 117,807.84 706,847.04
an assessed value of P65,448,800.00, and were subjected to real 3rd/1997
property tax as of 1985. TIADCc 4th 1997 196,346.40 (19,634.64) 176,711.76
MERALCO appealed Tax Declaration No. 019-6500 before the
LBAA of Lucena City, which was docketed as LBAA-89-2.
MERALCO claimed that its capital investment consisted only of its
substation facilities, the true and correct value of which was only P8,962,558.6
BASIC
P9,454,400.00; and that MERALCO was exempted from payment 7
of real property tax on said substation facilities. SEF 8,962,558.67
The LBAA rendered a Decision 14 in LBAA-89-2 on July 5, 1989,
finding that under its franchise, MERALCO was required to pay
the City Government of Lucena a tax equal to 5% of its gross
earnings, and "[s]aid tax shall be due and payable quarterly and TOTAL TAXP17,925,117.
shall be in lieu of any and all taxes of any kind, nature, or DELINQUENCY 34
description levied, established, or collected . . ., on its poles, wires, ==========
insulators, transformers and structures, installations, conductors, ===
and accessories, . . ., from which taxes the grantee (MERALCO)
is hereby expressly exempted." 15 As regards the issue of The City Treasurer of Lucena requested that MERALCO settle the
whether or not the poles, wires, insulators, transformers, payable amount soon to avoid accumulation of penalties. Attached
and electric meters of MERALCO were real properties, the LBAA to the letter were the following documents: (a) Notice of
cited the 1964 case of Board of Assessment Assessment 20 dated October 20, 1997 issued by
Appeals v. Manila Electric Company 16 (1964 MERALCO the City Assessor of Lucena, pertaining to Tax Declaration No.
case) in which the Court held that: (1) the steel towers fell within 019-7394, which increased the market value and assessed value
the term "poles" expressly exempted from taxes under the of the machinery; (b) Property Record Form; 21 and (c) Tax
franchise of MERALCO; and (2) the steel towers were personal Declaration No. 019-6500. 22
properties under the provisions of the Civil Code and, hence, not MERALCO appealed Tax Declaration Nos. 019-6500 and 019-
subject to real property tax. The LBAA lastly ordered that Tax 7394 before the LBAA of Lucena City on December 23, 1997 and
Declaration No. 019-6500 would remain and the poles, wires, posted a surety bond 23 dated December 10, 1997 to guarantee
insulators, transformers, and electric meters of MERALCO would payment of its real property tax delinquency. MERALCO asked the
be continuously assessed, but the City Assessor would stamp on LBAA to cancel and nullify the Notice of Assessment dated
the said Tax Declaration the word "exempt." The LBAA decreed in October 20, 1997 and declare the properties covered by Tax
the end: Declaration Nos. 019-6500 and 019-7394 exempt from real
WHEREFORE, from the evidence adduced by the parties, the property tax.
Board overrules the claim of the [City Assessor of Lucena] and In its Decision dated June 17, 1998 regarding Tax Declaration
sustain the claim of [MERALCO]. Nos. 019-6500 and 019-7394, the LBAA declared that Sections
Further, the Appellant (Meralco) is hereby ordered to render an 234 and 534 (f) of the Local Government Coderepealed the
accounting to the City Treasurer of Lucena and to pay provisions in the franchise of MERALCO and Presidential Decree
the City Government of Lucena the amount corresponding to the No. 551 24 pertaining to the exemption of MERALCO from
Five (5%) per centum of the gross earnings in compliance with payment of real property tax on its poles, wires, insulators,
paragraph 13 both Resolutions 108 and 2679, respectively, transformers, and meters. The LBAA refused to apply as res
retroactive from November 9, 1957 to date, if said tax has not yet judicata its earlier judgment in LBAA-89-2, as affirmed by the
been paid. 17 CBAA, because it involved collection of taxes from 1985 to 1989,
The City Assessor of Lucena filed an appeal with the CBAA, which while the present case concerned the collection of taxes from 1989
was docketed as CBAA Case No. 248. In its Decision 18 dated to 1997; and LBAA is only an administrative body, not a court or
April 10, 1991, the CBAA affirmed the assailed LBAA judgment. quasi-judicial body. The LBAA though instructed that the
Apparently, the City Assessor of Lucena no longer appealed said computation of the real property tax for the machineries should be
CBAA Decision and it became final and executory. based on the prevailing 1991 Schedule of Market Values, less the
Six years later, on October 16, 1997, MERALCO received a depreciation cost allowed by law. The LBAA ultimately disposed:
letter 19 dated October 16, 1997 from the City Treasurer of WHEREFORE, in view of the foregoing, it is hereby ordered that:
Lucena, which stated that the company was being assessed real 1) MERALCO's appeal be dismissed for lack of merit;
property tax delinquency on its machineries beginning 1990, in the 2) MERALCO be required to pay the realty tax on the questioned
total amount of P17,925,117.34, computed as follows: properties, because they are not exempt by law, same to be based
COVER on the 1991 level of assessment, less depreciation cost allowed
TAX ASSESSED TAX DUE PENALTY TOTAL by law. 25
ED
DE MERALCO went before the CBAA on appeal, which was docketed
VALUE PERIOD as CBAA Case No. L-20-98. The CBAA, in its Decision dated May
C. #
3, 2001, agreed with the LBAA that MERALCO could no longer
claim exemption from real property tax on its machineries with the
enactment of Republic Act No. 7160, otherwise known as the grantee any tax exemption of whatever nature except those of
the Local Government Code of 1991, thus: SDAaTC cooperatives. This we believe is basically in consonance with the
Indeed, the Central Board of Assessment Appeals has had the provisions of the Local Government Code more particularly
opportunity of ruling in [MERALCO's] favor in connection with this Section 234.
very same issue. The matter was settled on April 10, 1991 where Furthermore, Section 534(f) of R.A. 7160 which is taken in relation
this Authority ruled that "wires, insulators, transformers to Section 234 thereof states that "All general and special laws,
and electric meters which are mounted on poles and can be acts, city charters, decrees, executive orders, proclamations and
separated from the poles and moved from place to place without administrative regulations or part or parts thereof which are
breaking the material or causing [the] deterioration of the object, inconsistent with any of the provisions of this Code are hereby
are deemed movable or personal property". The same position of repealed or modified accordingly". Anent this unambiguous
MERALCO would have been tenable and that decision may have mandate, P.D. 551 is mandatorily repealed due to its contradictory
stood firm prior to the enactment of R.A. 7160 but not anymore in and irreconcilable provisions with R.A. 7160. 26
this jurisdiction. The Code provides and now sets a more stringent Yet, the CBAA modified the ruling of the LBAA by excluding from
yet broadened concept of machinery, . . .: the real property tax deficiency assessment the years 1990 to
xxx xxx xxx 1991, considering that:
The pivotal point where the difference lie between the former and In the years 1990 and 1991, the exemption granted to MERALCO
the current case is that by the very wordings of [Section 199(O)], under its franchise which incidentally expired upon the effectivity
the ground being anchored upon by MERALCO concerning the of the Local Government Code of 1991 was very much in effect
properties in question being personal in nature does not hold and the decision rendered by the Central Board of Assessment
anymore for the sole reason that these come now within the Appeals (CBAA) classifying its poles, wires, insulators,
purview and new concept of Machineries. The new law has treated transformers and electric meters as personal property was still
these in an unequivocal manner as machineries in the sense that controlling as the law of the case. So, from 1990 to 1991, it would
they are instruments, mechanical contrivances or apparatus be inappropriate and illegal to make the necessary assessment on
though not attached permanently to the real properties of those properties, much more to impose any penalty for non-
[MERALCO] are actually, directly and exclusively used to meet payment of such.
their business of distributing electricity. But, assessments made beginning 1992 until 1997 by
xxx xxx xxx the City Government of Lucena is legal, both procedurally and
Clearly, [Section 234 of the Local Government Code] lists down substantially. When R.A. 7160, which incorporated amended
the instances of exemption in real property taxation and very provisions of the Real Property Tax Code, took effect on January
apparent is the fact that the enumeration is exclusive in character 1, 1992, as already discussed, the nature of the aforecited
in view of the wordings in the last paragraph. Applying the maxim questioned properties considered formerly as personal
"Expressio Unius est Exclusio Alterius", we can say that "Where metamorphosed to machineries and the exemption being invoked
the statute enumerates those who can avail of the exemption, it is by [MERALCO] was automatically withdrawn pursuant to the letter
construed as excluding all others not mentioned therein". and spirit of the law. . . . . 27 acEHCD
Therefore, the above-named company [had] lost its previous Resultantly, the decretal portion of said CBAA Decision reads:
exemptions under its franchise because of non-inclusion in the WHEREFORE, in view of the foregoing, the Decision appealed
enumeration in Section 234. Furthermore, all tax exemptions being from is hereby modified. The City Assessor of Lucena City is
enjoyed by all persons, whether natural or juridical, including all hereby directed to make a new assessment on the subject
government-owned or controlled corporations are expressly properties to retroact from the year 1992 and the City Treasurer to
withdrawn, upon effectivity of R.A. 7160. collect the tax liabilities in accordance with the provisions of the
In the given facts, it has been manifested that the Municipal Board cited Section 222 of the Local Government Code. 28
of Lucena passed Resolution No. 108 on July 1, 1957 extending The CBAA denied the Motion for Reconsideration of MERALCO in
the franchise of MERALCO to operate in a Resolution 29 dated August 16, 2001.
Lucena city an electric light system for thirty-five years, which Disgruntled, MERALCO sought recourse from the Court of
should have expired on November 9, 1992 and under Resolution Appeals by filing a Petition for Review under Rule 43 of the Rules
No. 2679 passed on June 13, 1972 by the CityCouncil of of Court, which was docketed as CA-G.R. SP No. 67027.
Lucena City awarding [MERALCO] a franchise to operate for The Court of Appeals rendered a Decision on May 13, 2004
twenty years an electric light, heat and power system in rejecting all arguments proffered by MERALCO. The appellate
Lucena City, also to expire in the year 1992. Under those court found no deficiency in the Notice of Assessment issued by
franchises, they were only bound to pay franchise taxes and the City Assessor of Lucena:
nothing more. It was not disputed that [MERALCO] failed to provide the
Now, granting arguendo that there is no express revocation of the [City Assessor and City Treasurer of Lucena] with a sworn
exemption under the franchise of [MERALCO] since, statement declaring the true value of each of the subject
unquestionably [MERALCO] is a recipient of another franchise transformer and electric post, transmission line, insulator
granted this time by the National Electrification Commission as and electric meter which should have been made the basis of the
evidenced by a certificate issued on October 28, 1993, such fair and current market value of the aforesaid property and which
conferment does not automatically include and/or award would enable the assessor to identify the same for assessment
exemption from taxes, nor does it impliedly give the franchisee the purposes. [MERALCO] merely claims that the assessment made
right to continue the privileges like exemption granted under its by the [CityAssessor and City Treasurer of Lucena] was incorrect
previous franchise. It is just a plain and simple franchise. In but did not even mention in their pleading the true and correct
countless times, the Supreme Court has ruled that exemption must assessment of the said properties. Absent any sworn statement
be clear in the language of the law granting such exemption for it given by [MERALCO], [the City Assessor and City Treasurer of
is strictly construed and favored against the person invoking it. In Lucena] were constrained to make an assessment based on the
addition, a franchise though in the form of a contract is also a materials within [their reach]. 30
privilege that must yield to the sublime yet inherent powers of the The Court of Appeals further ruled that there was no more basis
state, one of these is the power of taxation. for the real property tax exemption of MERALCO under the Local
Looking into the law creating the National Electrification Government Code and that the withdrawal of said exemption did
Administration (Commission), P.D. 269 as amended by P.D. 1645, not violate the non-impairment clause of the Constitution, thus:
nowhere in those laws can we find such authority to bestow upon
Although it could not be denied that [MERALCO] was previously PROPERTIES SUBJECT TO REAL PROPERTY TAX; AND THAT
granted a Certificate of Franchise by the National Electrification ASSESSMENT ON THE SUBJECT PROPERTIES SHOULD BE
Commission on October 28, 1993 . . ., such conferment does not MADE TO TAKE EFFECT RETROACTIVELY FROM 1992 UNTIL
automatically include an exemption from the payment of realty tax, 1997, WITH PENALTIES; THE SAME BEING UNJUST,
nor does it impliedly give the franchisee the right to continue the WHIMSICAL AND NOT IN ACCORD WITH THE LOCAL
privileges granted under its previous franchise considering that GOVERNMENT CODE. 34
Sec. 534(f) of the Local Government Code of 1991 expressly MERALCO argues that its transformers, electric posts,
repealed those provisions which are inconsistent with the Code. transmission lines, insulators, and electric meters are not subject
At the outset, the Supreme Court has held that "Section 193 of the to real property tax, given that: (1) the definition of "machinery"
LGC prescribes the general rule, viz., tax exemptions or incentives under Section 199 (o) of the Local Government Code, on which
granted to or presently enjoyed by natural or juridical persons are real property tax is imposed, must still be within the contemplation
withdrawn upon the effectivity of the LGC except with respect to of real or immovable property under Article 415 of the Civil
those entities expressly enumerated. In the same vein, We must Code because it is axiomatic that a statute should be construed to
hold that the express withdrawal upon effectivity of the LGC of all harmonize with other laws on the same subject matter as to form
exemptions except only as provided therein, can no longer be a complete, coherent, and intelligible system; (2) the Decision
invoked by MERALCO to disclaim liability for the local tax." dated April 10, 1991 of the CBAA in CBAA Case No. 248, which
(City Government of San Pablo, Laguna vs. Reyes, 305 SCRA affirmed the Decision dated July 5, 1989 of the LBAA in LBAA-89-
353, 362-363) 2, ruling that the transformers, electric posts, transmission lines,
In fine, [MERALCO's] invocation of the non-impairment clause of insulators, and electric meters of MERALCO are movable or
the Constitution is accordingly unavailing. The LGC was enacted personal properties, is conclusive and binding; and (3)
in pursuance of the constitutional policy to ensure autonomy to the electric poles are not exclusively used to meet the needs of
local governments and to enable them to attain fullest MERALCO alone since these are also being utilized by other
development as self-reliant communities. The power to tax is entities such as cable and telephone companies.
primarily vested in Congress. However, in our jurisdiction, it may MERALCO further asserts that even if it is assumed for the sake
be exercised by local legislative bodies, no longer merely by virtue of argument that the transformers, electric posts, transmission
of a valid delegation as before, but pursuant to [a] direct authority lines, insulators, and electric meters are real properties, the
conferred by Section 5, Article X of the Constitution. The important assessment of said properties by the City Assessor in 1997 is a
legal effect of Section 5 is that henceforth, in interpreting statutory patent nullity. The collection letter dated October 16, 1997 of
provisions on municipal fiscal powers, doubts will be resolved in the City Treasurer of Lucena, Notice of Assessment dated
favor of the municipal corporations. (Ibid. pp. 363-365) 31 October 20, 1997 of the City Assessor of Lucena, the Property
MERALCO similarly failed to persuade the Court of Appeals that Record Form dated October 20, 1997, and Tax Declaration No.
the transformers, transmission lines, insulators, 019-6500 simply state a lump sum market value for all the
and electric meters mounted on the electric posts of MERALCO transformers, electric posts, transmission lines, insulators,
were not real properties. The appellate court invoked the definition and electric meters covered and did not provide an inventory/list
of "machinery" under Section 199 (o) of the Local Government showing the actual number of said properties, or a schedule of
Code and then wrote that: values presenting the fair market value of each property or type of
We firmly believe and so hold that the wires, insulators, property, which would have enabled MERALCO to verify the
transformers and electric meters mounted on the poles of correctness and reasonableness of the valuation of its properties.
[MERALCO] may nevertheless be considered as improvements on MERALCO was not furnished at all with a copy of Tax Declaration
the land, enhancing its utility and rendering it useful in distributing No. 019-7394, and while it received a copy of Tax Declaration No.
electricity. The said properties are actually, directly and exclusively 019-6500, said tax declaration did not contain the requisite
used to meet the needs of [MERALCO] in the distribution of information regarding the date of operation of MERALCO and the
electricity. original cost, depreciation, and market value for each property
In addition, "improvements on land are commonly taxed as realty covered. For the foregoing reasons, the assessment of the
even though for some purposes they might be considered properties of MERALCO in 1997 was arbitrary, whimsical, and
personalty. It is a familiar personalty phenomenon to see things without factual basis in patent violation of the right to due
classed as real property for purposes of taxation which on general process of MERALCO. MERALCO additionally explains that it
principle might be considered personal property." (Caltex (Phil.), cannot be expected to make a declaration of its
Inc. vs. Central Board of Assessment Appeals, 114 SCRA 296, transformers, electric posts, transmission lines, insulators,
301-302) 32 and electric meters, because all the while, it was of the impression
Lastly, the Court of Appeals agreed with the CBAA that the new that the said properties were personal properties by virtue of the
assessment of the transformers, electric posts, transmission lines, Decision dated July 5, 1989 of the LBAA in LBAA-89-2 and the
insulators, and electric meters of MERALCO shall retroact to Decision dated April 10, 1991 of the CBAA in CBAA Case No.
1992. 248.
Hence, the Court of Appeals adjudged: Granting that the assessment of its transformers, electric posts,
WHEREFORE, premises considered, the assailed Decision transmission lines, insulators, and electric meters by
[dated] May 3, 2001 and Resolution dated August 16, 2001 are the City Assessor of Lucena in 1997 is valid, MERALCO
hereby AFFIRMED in toto and the present petition is hereby alternatively contends that: (1) under Sections 221 35 and
DENIED DUE COURSE and accordingly DISMISSED for lack 222 36 of the Local Government Code, the assessment should
of merit. 33 take effect only on January 1, 1998 and not retroact to 1992; (2)
In a Resolution dated November 18, 2004, the Court of Appeals MERALCO should not be held liable for penalties and interests
denied the Motion for Reconsideration of MERALCO. SDHTEC since its nonpayment of real property tax on its properties was in
MERALCO is presently before the Court via the instant Petition for good faith; and (3) if interest may be legally imposed on
Review on Certiorari grounded on the following lone assignment MERALCO, it should only begin to run on the date it received the
of error: Notice of Assessment on October 29, 1997 and not all the way
THE COURT OF APPEALS COMMITTED A GRAVE back to 1992.
REVERSIBLE ERROR IN AFFIRMING IN TOTO THE DECISION At the end of its Petition, MERALCO prays:
OF THE CENTRAL BOARD OF ASSESSMENT APPEALS WHEREFORE, it is respectfully prayed of this Honorable Court
WHICH HELD THAT THE SUBJECT PROPERTIES ARE REAL that the appealed Decision dated May 13, 2004 of the Court of
Appeals, together with its Resolution dated November 18, 2004 be taxes and penalties due, it posted a surety bond in the amount of
reversed and set aside, and judgment be rendered . . . nullifying P17,925,117.34.
and cancel[l]ing the Notice of Assessment, dated October 20, By posting the surety bond, MERALCO may be considered to have
1997, issued by respondent City Assessor, and the collection substantially complied with Section 252 of the Local Government
letter dated October 16, 1997 of respondent City Treasurer. Code for the said bond already guarantees the payment to the
Petitioner also prays for such other relief as may be deemed just Office of the City Treasurer of Lucena of the total amount of real
and equitable in the premises. 37 property taxes and penalties due on Tax Declaration Nos. 019-
The City Assessor and City Treasurer of Lucena counter that: (1) 6500 and 019-7394. This is not the first time that the Court allowed
MERALCO was obliged to pay the real property tax due, instead a surety bond as an alternative to cash payment of the real
of posting a surety bond, while its appeal was pending, because property tax before protest/appeal as required by Section 252
Section 231 of the Local Government Code provides that the of the Local Government Code. In Camp John Hay Development
appeal of an assessment shall not suspend the collection of the Corporation v. Central Board of Assessment Appeals, 39 the
real property taxes; (2) the cases cited by MERALCO can no Court affirmed the ruling of the CBAA and the Court of Tax
longer be applied to the case at bar since they had been decided Appeals en banc applying the "payment under protest"
when Presidential Decree No. 464, otherwise known as the Real requirement in Section 252 of the Local Government Code and
Property Tax Code, was still in effect; (3) under the now prevailing remanding the case to the LBAA for "further proceedings subject
Local Government Code, which expressly repealed the Real to a full and up-to-date payment, either in cash or surety, of
Property Tax Code, the transformers, electric posts, transmission realty tax on the subject properties . . . ."
lines, insulators, and electric meters of MERALCO fall within the Accordingly, the LBAA herein correctly took cognizance of and
new definition of "machineries," deemed as real properties subject gave due course to the appeal of Tax Declaration Nos. 019-6500
to real property tax; and (4) the Notice of Assessment dated and 019-7394 filed by MERALCO.
October 20, 1997 covering the transformers, electric posts, Beginning January 1, 1992,
transmission lines, insulators, and electric meters of MERALCO MERALCO can no longer claim
only retroacts to 1992, which is less than 10 years prior to the date exemption from real property tax of
of initial assessment, so it is in compliance with Section 222 of the its transformers, electric posts,
Local Government Code, and since MERALCO has yet to pay the transmission lines, insulators, and
real property taxes due on said assessment, then it is just right and electric meters based on its
appropriate that it also be held liable to pay for penalties and franchise.
interests from 1992 to present time. Ultimately, MERALCO relies heavily on the Decision dated April 10, 1991 of
the CityAssessor and City Treasurer of Lucena seek judgment the CBAA in CBAA Case No. 248, which affirmed the Decision
denying the instant Petition and ordering MERALCO to pay the dated July 5, 1989 of the LBAA in LBAA-89-2. Said decisions of
real property taxes due. AScHCD the CBAA and the LBAA, in turn, cited Board of Assessment
The Petition is partly meritorious. Appeals v. Manila Electric Co., 40 which was decided by the
The Court finds that the transformers, electric posts, transmission Court way back in 1964 (1964 MERALCO case). The decisions in
lines, insulators, and electric meters of MERALCO are no longer CBAA Case No. 248 and the 1964 MERALCO case recognizing
exempted from real property tax and may qualify as "machinery" the exemption from real property tax of the
subject to real property tax under the Local Government Code. transformers, electric posts, transmission lines, insulators,
Nevertheless, the Court declares null and void the appraisal and and electric meters of MERALCO are no longer applicable
assessment of said properties of MERALCO by because of subsequent developments that changed the factual
the City Assessor in 1997 for failure to comply with the and legal milieu for MERALCO in the present case.
requirements of the Local Government Code and, thus, violating In the 1964 MERALCO case, the City Assessor of
the right of MERALCO to due process. Quezon City considered the steel towers of MERALCO as real
By posting a surety bond before property and required MERALCO to pay real property taxes for the
filing its appeal of the assessment said steel towers for the years 1952 to 1956. MERALCO was
with the LBAA, MERALCO operating pursuant to the franchise granted under Ordinance No.
substantially complied with the 44 dated March 24, 1903 of the Municipal Board of Manila, which
requirement of payment under it acquired from the original grantee, Charles M. Swift. Under its
protest in Section 252 of the Local franchise, MERALCO was expressly granted the following tax
Government Code. exemption privilege:
Section 252 of the Local Government Code mandates that "[n]o Par 9. The grantee shall be liable to pay the same taxes upon its
protest shall be entertained unless the taxpayer first pays the tax." real estate, buildings, plant (not including poles, wires,
It is settled that the requirement of "payment under protest" is a transformers, and insulators), machinery and personal property as
condition sine qua non before an appeal may be other persons are or may be hereafter required by law to pay. . . .
entertained. 38 Section 231 of the same Code also dictates that Said percentage shall be due and payable at the times stated in
"[a]ppeal on assessments of real property . . . shall, in no case, paragraph nineteen of Part One hereof, . . . and shall be in lieu of
suspend the collection of the corresponding realty taxes on the all taxes and assessments of whatsoever nature, and by
property involved as assessed by the provincial or city assessor, whatsoever authority upon the privileges, earnings, income,
without prejudice to subsequent adjustment depending upon the franchise, and poles, wires, transformers, and insulators of the
final outcome of the appeal." Clearly, under the Local Government grantee from which taxes and assessments the grantee is hereby
Code, even when the assessment of the real property is appealed, expressly exempted. . . . . 41
the real property tax due on the basis thereof should be paid to Given the express exemption from taxes and assessments of the
and/or collected by the local government unit concerned. "poles, wires, transformers, and insulators" of MERALCO in the
In the case at bar, the City Treasurer of Lucena, in his letter dated aforequoted paragraph, the sole issue in the 1964 MERALCO
October 16, 1997, sought to collect from MERALCO the amount case was whether or not the steel towers of MERALCO qualified
of P17,925,117.34 as real property taxes on its machineries, plus as "poles" which were exempted from real property tax. The Court
penalties, for the period of 1990 to 1997, based on Tax Declaration ruled in the affirmative, ratiocinating that:
Nos. 019-6500 and 019-7394 issued by the City Assessor of Along the streets, in the City of Manila, may be seen cylindrical
Lucena. MERALCO appealed Tax Declaration Nos. 019-6500 and metal poles, cubical concrete poles, and poles of the PLDT Co.
019-7394 with the LBAA, but instead of paying the real property which are made of two steel bars joined together by an interlacing
metal rod. They are called "poles" notwithstanding the fact that Section 193. Withdrawal of Tax Exemption Privileges. Unless
they are not made of wood. It must be noted from paragraph 9, otherwise provided in this Code, tax exemptions or incentives
above quoted, that the concept of the "poles" for which exemption granted to, or presently enjoyed by all persons, whether natural or
is granted, is not determined by their place or location, nor by the juridical, including government-owned or controlled corporations,
character of the electric current it carries, nor the material or form except local water districts, cooperatives duly registered
of which it is made, but the use to which they are dedicated. In under R.A. No. 6938, non-stock and non-profit hospitals and
accordance with the definitions, a pole is not restricted to a long educational institutions, are hereby withdrawn upon the effectivity
cylindrical piece of wood or metal, but includes "upright standards of this Code.
to the top of which something is affixed or by which something is Section 234. Exemptions from Real Property Tax. The following
supported." As heretofore described, respondent's steel supports are exempted from payment of the real property tax:
consist of a framework of four steel bars or strips which are bound (a) Real property owned by the Republic of the Philippines or any
by steel cross-arms atop of which are cross-arms supporting five of its political subdivisions except when the beneficial use thereof
high voltage transmission wires (See Annex A) and their sole has been granted, for consideration or otherwise, to a taxable
function is to support or carry such wires. person;
The conclusion of the CTA that the steel supports in question are (b) Charitable institutions, churches, parsonages or convents
embraced in the term "poles" is not a novelty. Several courts of appurtenant thereto, mosques, nonprofit or religious cemeteries
last resort in the United States have called these steel supports and all lands, buildings, and improvements actually, directly, and
"steel towers", and they have denominated these supports or exclusively used for religious, charitable or educational purposes;
towers, as electric poles. In their decisions the words "towers" and (c) All machineries and equipment that are actually, directly and
"poles" were used interchangeably, and it is well understood in that exclusively used by local water districts and government-owned or
jurisdiction that a transmission tower or pole means the same controlled corporations engaged in the supply and distribution of
thing. water and/or generation and transmission of electric power;
xxx xxx xxx (d) All real property owned by duly registered cooperatives as
It is evident, therefore, that the word "poles", as used in Act No. provided for under R.A. No. 6938; and
484 and incorporated in the petitioner's franchise, should not be (e) Machinery and equipment used for pollution control and
given a restrictive and narrow interpretation, as to defeat the very environmental protection.
object for which the franchise was granted. The poles as Except as provided herein, any exemption from payment of real
contemplated thereon, should be understood and taken as a part property tax previously granted to, or presently enjoyed by, all
of the electricpower system of the respondent Meralco, for the persons, whether natural or juridical, including all government-
conveyance of electric current from the source thereof to its owned or controlled corporations are hereby withdrawn upon the
consumers. . . . . 42 effectivity of this Code.
Similarly, it was clear that under the 20-year franchise granted to The Local Government Code, in addition, contains a general
MERALCO by the Municipal Board of Lucena City through repealing clause under Section 534 (f) which states that "[a]ll
Resolution No. 2679 dated June 13, 1972, the general and special laws, acts, city charters, decrees, executive
transformers, electric posts, transmission lines, insulators, orders, proclamations and administrative regulations, or part or
and electric meters of MERALCO were exempt from real property parts thereof which are inconsistent with any of the provisions of
tax. Paragraph 13 of Resolution No. 2679 is quoted in full this Code are hereby repealed or modified accordingly."
below: caITAC Taking into account the above-mentioned provisions, the evident
13. The grantee shall be liable to pay the same taxes upon its real intent of the Local Government Code is to withdraw/repeal all
estate, building, machinery, and personal property (not including exemptions from local taxes, unless otherwise provided by the
poles, wires, transformers, and insulators) as other persons Code. The limited and restrictive nature of the tax exemption
are now or may hereafter be required by law to pay. In privileges under the Local Government Code is consistent with the
consideration of the franchise and rights hereby granted, the State policy to ensure autonomy of local governments and the
grantee shall pay into the CityTreasury of Lucena a tax equal to objective of the Local Government Code to grant genuine and
FIVE (5%) PER CENTUM of the gross earnings received meaningful autonomy to enable local government units to attain
from electric current sold or supplied under this franchise. Said tax their fullest development as self-reliant communities and make
shall be due and payable quarterly and shall be in lieu of any and them effective partners in the attainment of national goals. The
all taxes of any kind, nature or description levied, established, obvious intention of the law is to broaden the tax base of local
or collected by any authority whatsoever, municipal, provincial, or government units to assure them of substantial sources of
national, now or in the future, on its poles, wires, insulators, revenue. 43
switches, transformers and structures, installations, Section 234 of the Local Government Code particularly identifies
conductors, and accessories, placed in and over and under all the exemptions from payment of real property tax, based on the
the private and/or public property, including public streets and ownership, character, and use of the property, viz.:
highways, provincial roads, bridges, and public squares, and on its (a) Ownership Exemptions. Exemptions from real property taxes
franchise rights, privileges, receipts, revenues and profits, from on the basis of ownership are real properties owned by: (i) the
which taxes the grantee is hereby expressly exempted. Republic, (ii) a province, (iii) a city, (iv) a municipality, (v)
(Emphases supplied.) a barangay, and (vi) registered cooperatives.
In CBAA Case No. 248 (and LBAA-89-2), (b) Character Exemptions. Exempted from real property taxes on
the City Assessor assessed the transformers, electric posts, the basis of their character are: (i) charitable institutions, (ii)
transmission lines, insulators, and electric meters of MERALCO houses and temples of prayer like churches, parsonages or
located in Lucena City beginning 1985 under Tax Declaration No. convents appurtenant thereto, mosques, and (iii) nonprofit or
019-6500. The CBAA in its Decision dated April 10, 1991 in CBAA religious cemeteries.
Case No. 248 sustained the exemption of the said properties of (c) Usage exemptions. Exempted from real property taxes on the
MERALCO from real property tax on the basis of paragraph 13 of basis of the actual, direct and exclusive use to which they are
Resolution No. 2679 and the 1964 MERALCO case. devoted are: (i) all lands, buildings and improvements which are
Just when the franchise of MERALCO in Lucena City was about actually directly and exclusively used for religious, charitable or
to expire, the Local Government Code took effect on January 1, educational purposes; (ii) all machineries and equipment actually,
1992, Sections 193 and 234 of which provide: directly and exclusively used by local water districts or by
government-owned or controlled corporations engaged in the
supply and distribution of water and/or generation and collected, an annual ad
transmission of electric power; and (iii) all machinery and valorem tax
equipment used for pollution control and environmental on real property, including
Effectivity: xxx
protection. land,
To help provide a healthy environment in the midst of the buildings, machinery, and
January 1, 1940
modernization of the country, all machinery and equipment for other
pollution control and environmental protection may not be taxed improvements not(f) Machinery, which
by local governments. hereinafter term
2. Other Exemptions Withdrawn. All other exemptions previously shall embrace
specifically exempted.
granted to natural or juridical persons including government- machines,
owned or controlled corporations are withdrawn upon the mechanical
effectivity of the Code. 44 contrivances,
The last paragraph of Section 234 had unequivocally withdrawn, instruments,
upon the effectivity of the Local Government Code, exemptions appliances, and
from payment of real property taxes granted to natural or juridical apparatus attached
persons, including government-owned or controlled corporations, to the real
except as provided in the same section. estate, used for
MERALCO, a private corporation engaged in electric distribution, industrial
and its transformers, electric posts, transmission lines, insulators, agricultural or
and electric meters used commercially do not qualify under any of manufacturing
the ownership, character, and usage exemptions enumerated in purposes, during the
Section 234 of the Local Government Code. It is a basic precept first five
of statutory construction that the express mention of one person, years of the operation
thing, act, or consequence excludes all others as expressed in the of the
familiar maxim expressio unius est exclusio alterius. 45Not being
machinery.
among the recognized exemptions from real property tax in
Section 234 of the Local Government Code, then the exemption of
the transformers, electric posts, transmission lines, insulators,
and electric meters of MERALCO from real property tax granted Section 38. Incidence ofSection 3. Definition
Real Property
under its franchise was among the exemptions withdrawn upon the Real of Terms.
effectivity of the Local Government Code on January 1, 1998. Property Tax. There When used in this
Tax Code
It is worthy to note that the subsequent franchises for operation shall be Code
granted to MERALCO, i.e., under the Certificate of Franchise levied, assessed and
dated October 28, 1993 issued by the National Electrification collected in
Commission and Republic Act No. 9209 enacted on June 9, 2003 all provinces, cities and
Effectivity: xxx
by Congress, are completely silent on the matter of exemption municipalities
from real property tax of MERALCO or any of its properties. an annual ad valorem tax
June 1, 1974
It is settled that tax exemptions must be clear and unequivocal. A on real
taxpayer claiming a tax exemption must point to a specific property, such as land,(m) Machinery
provision of law conferring on the taxpayer, in clear and plain buildings, shall embrace
terms, exemption from a common burden. Any doubt whether a machinery and othermachines,
tax exemption exists is resolved against the improvements mechanical
taxpayer. 46 MERALCO has failed to present herein any express affixed or attached to realcontrivances,
grant of exemption from real property tax of its property instruments,
transformers, electric posts, transmission lines, insulators, not hereinafter specificallyappliances and
and electric meters that is valid and binding even under the Local exempted. apparatus attached
Government Code. cDHAES to the real estate. It
The transformers, electric posts, includes the
transmission lines, insulators, and physical facilities
electric meters of MERALCO may available for
qualify as "machinery" under the production, as well
Local Government Code subject to as the
real property tax. installations and
Through the years, the relevant laws have consistently considered appurtenant
"machinery" as real property subject to real property tax. It is the service facilities,
definition of "machinery" that has been changing and expanding, together with
as the following table will show: all other equipment
Incidence of RealDefinition of designed
Real Property for or essential to
Property Tax Machinery 47
its
Tax Law manufacturing,
industrial or
agricultural
The AssessmentSection 2. Incidence of realSection 3. Property purposes.
Law property exempt
tax. Except in charteredfrom tax. The
Commonwealth Section 38. Incidence ofSection 3. Definition
cities, exemptions
Real Property
there shall be levied, Real of Terms.
Act No. 470) shall be as follows:
assessed, and
Property Tax. There When used in this apparatus which
Tax Code,
shall be Code may or may not
levied, assessed and be attached,
as amended by
collected in permanently or
Presidential temporarily, to the
all provinces, cities and xxx
Decree real
property. It includes
No. 1383 municipalities an annual ad
the physical
valorem tax on real(m) Machinery facilities for
property, such shall embrace production, the
as land,machines, installations and
Effectivity:
buildings, machinery and equipment, appurtenant
other improvements affixedmechanical service
May 25, 1978
or contrivances, facilities, those
attached to real propertyinstruments, which are
not appliances and mobile, self-
hereinafter specificallyapparatus attached powered or self-
exempted. to the real propelled, and those
estate. It shall include not
the permanently
physical facilities attached to the real
available for property which are
production, as well as actually,
the directly, and
installations and exclusively used to
appurtenant meet the needs of the
service particular
facilities, together industry, business or
with activity and
all those not which by their very
permanently nature and
attached to the real purpose are
estate but designed for, or
are actually, directly necessary to its
and manufacturing,
essentially used to mining, logging,
meet the commercial,
needs of the industrial or
particular agricultural
industry, business,
purposes[.]
or works,
which by their very
nature and MERALCO is a public utility engaged in electric distribution, and
purpose are its transformers, electric posts, transmission lines, insulators,
designed for, or and electric meters constitute the physical facilities through which
essential to MERALCO delivers electricity to its consumers. Each may be
manufacturing, considered as one or more of the following: a
commercial, mining, "machine," 48 "equipment," 49 "contrivance," 50"instrument," 51 "
industrial appliance," 52 "apparatus," 53 or "installation." 54
or agricultural The Court highlights that under Section 199 (o) of the Local
purposes. Government Code, machinery, to be deemed real property subject
Local Section 232. Power to LevySection 199. to real property tax, need no longer be annexed to the land or
Government Real Definitions. building as these "may or may not be attached, permanently or
Property Tax. A provinceWhen used in this temporarily to the real property," and in fact, such machinery may
Code
or city Title: even be "mobile." 55 The same provision though requires that to
be machinery subject to real property tax, the physical facilities for
or a municipality within the
production, installations, and appurtenant service facilities, those
Metropolitan Manila Area which are mobile, self-powered or self-propelled, or not
Effectivity: xxx
may permanently attached to the real property (a) must be actually,
levy an annual ad directly, and exclusively used to meet the needs of the particular
January 1, 1992
valorem tax on industry, business, or activity; and (2) by their very nature and
real property such as land,(o) "Machinery" purpose, are designed for, or necessary for manufacturing, mining,
building, embraces logging, commercial, industrial, or agricultural purposes. Thus,
machinery, and othermachines, Article 290 (o) of the Rules and Regulations Implementing
improvement equipment, the Local Government Code of 1991 recognizes the following
not hereinafter specificallymechanical exemption:
exempted. contrivances, Machinery which are of general purpose use including but not
instruments, limited to office equipment, typewriters, telephone equipment,
appliances or breakable or easily damaged containers (glass or cartons),
microcomputers, facsimile machines, telex machines, cash business, or activity; and (2) by their very nature and purpose, be
dispensers, furnitures and fixtures, freezers, refrigerators, display designed for, or necessary for manufacturing, mining, logging,
cases or racks, fruit juice or beverage automatic dispensing commercial, industrial, or agricultural purposes.
machines which are not directly and exclusively used to meet the Article 415, paragraph (1) of the Civil Code declares as
needs of a particular industry, business or activity shall not be immovables or real properties "[l]and, buildings, roads and
considered within the definition of machinery under this Rule. constructions of all kinds adhered to the soil." The land, buildings,
(Emphasis supplied.) and roads are immovables by nature "which cannot be moved from
The 1964 MERALCO case was decided when The Assessment place to place," whereas the constructions adhered to the soil are
Law was still in effect and Section 3 (f) of said law still required that immovables by incorporation "which are essentially movables, but
the machinery be attached to the real property. Moreover, as the are attached to an immovable in such manner as to be an integral
Court pointed out earlier, the ruling in the 1964 MERALCO case part thereof." 57 Article 415, paragraph (3) of the Civil Code,
that the electric poles (including the steel towers) of MERALCO referring to "[e]verything attached to an immovable in a fixed
are not subject to real property tax was primarily based on the manner, in such a way that it cannot be separated therefrom
express exemption granted to MERALCO under its previous without breaking the material or deterioration of the object," are
franchise. The reference in said case to the Civil Code definition likewise immovables by incorporation. In contrast, the Local
of real property was only an alternative argument: Government Code considers as real property machinery which
Granting for the purpose of argument that the steel supports "may or may not be attached, permanently or temporarily to the
or towers in question are not embraced within the term poles, real property," and even those which are "mobile."
the logical question posited is whether they constitute real Article 415, paragraph (5) of the Civil Code considers as
properties, so that they can be subject to a real property immovables or real properties "[m]achinery, receptacles,
tax. The tax law does not provide for a definition of real property; instruments or implements intended by the owner of the tenement
but Article 415 of the Civil Code does, by stating the following for an industry or works which may be carried on in a building or
are immovable property: ASEcHI on a piece of land, and which tend directly to meet the needs of
(1) Land, buildings, roads, and constructions of all kinds adhered the said industry or works." The Civil Code, however, does not
to the soil; define "machinery."
xxx xxx xxx The properties under Article 415, paragraph (5) of the Civil
(3) Everything attached to an immovable in a fixed manner, in such Code are immovables by destination, or "those which are
a way that it cannot be separated therefrom without breaking the essentially movables, but by the purpose for which they have been
material or deterioration of the object; placed in an immovable, partake of the nature of the latter because
xxx xxx xxx of the added utility derived therefrom." 58 These properties,
(5) Machinery, receptacles, instruments or implements intended including machinery, become immobilized if the following
by the owner of the tenement for an industry or works which may requisites concur: (a) they are placed in the tenement by the owner
be carried in a building or on a piece of land, and which tends of such tenement; (b) they are destined for use in the industry or
directly to meet the needs of the said industry or works; work in the tenement; and (c) they tend to directly meet the needs
xxx xxx xxx of said industry or works. 59 The first two requisites are not found
The steel towers or supports in question, do not come within the anywhere in the Local Government Code.
objects mentioned in paragraph 1, because they do not constitute MERALCO insists on harmonizing the aforementioned provisions
buildings or constructions adhered to the soil. They are not of the Civil Code and the Local Government Code. The Court
constructions analogous to buildings nor adhering to the soil. As disagrees, however, for this would necessarily mean imposing
per description, given by the lower court, they are removable and additional requirements for classifying machinery as real property
merely attached to a square metal frame by means of bolts, which for real property tax purposes not provided for, or even in direct
when unscrewed could easily be dismantled and moved from conflict with, the provisions of the Local Government Code.
place to place. They can not be included under paragraph 3, as As between the Civil Code, a general law governing property and
they are not attached to an immovable in a fixed manner, and they property relations, and the Local Government Code, a special law
can be separated without breaking the material or causing granting local government units the power to impose real property
deterioration upon the object to which they are attached. Each of tax, then the latter shall prevail. As the Court pronounced
these steel towers or supports consists of steel bars or metal in Disomangcop v. The Secretary of the Department of Public
strips, joined together by means of bolts, which can be Works and Highways Simeon A. Datumanong: 60 ITAaHc
disassembled by unscrewing the bolts and reassembled by It is a finely-imbedded principle in statutory construction that a
screwing the same. These steel towers or supports do not also fall special provision or law prevails over a general one. Lex specialis
under paragraph 5, for they are not machineries or receptacles, derogant generali. As this Court expressed in the case
instruments or implements, and even if they were, they are not of Leveriza v. Intermediate Appellate Court, "another basic
intended for industry or works on the land. Petitioner is not principle of statutory construction mandates that general
engaged in an industry or works on the land in which the steel legislation must give way to special legislation on the same
supports or towers are constructed. 56 (Emphases supplied.) subject, and generally be so interpreted as to embrace only cases
The aforequoted conclusions of the Court in the 1964 MERALCO in which the special provisions are not applicable, that specific
case do not hold true anymore under the Local Government Code. statute prevails over a general statute and that where two statutes
While the Local Government Code still does not provide for a are of equal theoretical application to a particular case, the one
specific definition of "real property," Sections 199 (o) and 232 of designed therefor specially should prevail." (Citations omitted.)
the said Code, respectively, gives an extensive definition of what The Court also very clearly explicated in Vinzons-Chato v. Fortune
constitutes "machinery" and unequivocally subjects such Tobacco Corporation 61 that:
machinery to real property tax. The Court reiterates that the A general law and a special law on the same subject are statutes
machinery subject to real property tax under the Local in pari materia and should, accordingly, be read together and
Government Code "may or may not be attached, permanently or harmonized, if possible, with a view to giving effect to both. The
temporarily to the real property;" and the physical facilities for rule is that where there are two acts, one of which is special and
production, installations, and appurtenant service facilities, those particular and the other general which, if standing alone, would
which are mobile, self-powered or self-propelled, or are not include the same matter and thus conflict with the special act, the
permanently attached must (a) be actually, directly, and special law must prevail since it evinces the legislative intent more
exclusively used to meet the needs of the particular industry, clearly than that of a general statute and must not be taken as
intended to affect the more particular and specific provisions of the reproduction cost for so long as the machinery is useful and in
earlier act, unless it is absolutely necessary so to construe it in operation.
order to give its words any meaning at all. It is apparent from these two provisions that every machinery must
The circumstance that the special law is passed before or after the be individually appraised and assessed depending on its
general act does not change the principle. Where the special law acquisition cost, remaining economic life, estimated economic life,
is later, it will be regarded as an exception to, or a qualification of, replacement or reproduction cost, and depreciation. CHTAIc
the prior general act; and where the general act is later, the special Article 304 of the Rules and Regulations Implementing the Local
statute will be construed as remaining an exception to its terms, Government Code of 1991 expressly authorizes the
unless repealed expressly or by necessary implication. (Citations local assessor or his deputy to receive evidence for the proper
omitted.) appraisal and assessment of the real property:
Furthermore, in Caltex (Philippines), Inc. v. Central Board of Article 304. Authority of Local Assessors to Take Evidence. For
Assessment Appeals, 62 the Court acknowledged that "[i]t is a the purpose of obtaining information on which to base the market
familiar phenomenon to see things classed as real property for value of any real property, the assessor of the province, city, or
purposes of taxation which on general principle might be municipality or his deputy may summon the owners of the
considered personal property[.]" properties to be affected or persons having legal interest therein
Therefore, for determining whether machinery is real property and witnesses, administer oaths, and take deposition concerning
subject to real property tax, the definition and requirements the property, its ownership, amount, nature, and value.
under the Local Government Code are controlling. The Local Government Code further mandates that the taxpayer
MERALCO maintains that its electric posts are not machinery be given a notice of the assessment of real property in the
subject to real property tax because said posts are not being following manner:
exclusively used by MERALCO; these are also being utilized by Section 223. Notification of New or Revised Assessment. When
cable and telephone companies. This, however, is a factual issue real property is assessed for the first time or when an existing
which the Court cannot take cognizance of in the Petition at bar as assessment is increased or decreased, the provincial, city or
it is not a trier of facts. Whether or not the electric posts of municipal assessor shall within thirty (30) days give written notice
MERALCO are actually being used by other companies or of such new or revised assessment to the person in whose name
industries is best left to the determination of the City Assessor or the property is declared. The notice may be delivered personally
his deputy, who has been granted the authority to take evidence or by registered mail or through the assistance of the punong
under Article 304 of the Rules and Regulations Implementing barangay to the last known address of the person to served.
the Local Government Code of 1991. A notice of assessment, which stands as the first instance the
Nevertheless, the appraisal and taxpayer is officially made aware of the pending tax liability, should
assessment of the transformers, be sufficiently informative to apprise the taxpayer the legal basis
electric posts, transmission lines, of the tax. 64 In Manila Electric Company v. Barlis, 65 the Court
insulators, and electric meters of described the contents of a valid notice of assessment of real
MERALCO as machinery under Tax property and differentiated the same from a notice of collection:
Declaration Nos. 019-6500 and 019- A notice of assessment as provided for in the Real Property Tax
7394 were not in accordance with the Code should effectively inform the taxpayer of the value of a
Local Government Code and in specific property, or proportion thereof subject to tax, including the
violation of the right to due process discovery, listing, classification, and appraisal of properties. The
of MERALCO and, therefore, null September 3, 1986 and October 31, 1989 notices do not contain
and void. the essential information that a notice of assessment must specify,
The Local Government Code defines "appraisal" as the "act or namely, the value of a specific property or proportion thereof which
process of determining the value of property as of a specific date is being taxed, nor does it state the discovery, listing, classification
for a specific purpose." "Assessment" is "the act or process of and appraisal of the property subject to taxation. In fact, the tenor
determining the value of a property, or proportion thereof subject of the notices bespeaks an intention to collect unpaid taxes, thus
to tax, including the discovery, listing, classification, and appraisal the reminder to the taxpayer that the failure to pay the taxes shall
of the properties[.]" 63 When it comes to machinery, its appraisal authorize the government to auction off the properties subject to
and assessment are particularly governed by Sections 224 and taxes . . . .
225 of the Local Government Code, which read: Although the ruling quoted above was rendered under the Real
Section 224. Appraisal and Assessment of Machinery. (a) The Property Tax Code, the requirement of a notice of assessment has
fair market value of a brand-new machinery shall be the acquisition not changed under the Local Government Code.
cost. In all other cases, the fair market value shall be determined A perusal of the documents received by MERALCO on October
by dividing the remaining economic life of the machinery by its 29, 1997 reveals that none of them constitutes a valid notice of
estimated economic life and multiplied by the replacement or assessment of the transformers, electricposts, transmission lines,
reproduction cost. insulators, and electric meters of MERALCO.
(b) If the machinery is imported, the acquisition cost includes The letter dated October 16, 1997 of the City Treasurer of Lucena
freight, insurance, bank and other charges, brokerage, arrastre (which interestingly precedes the purported Notice of Assessment
and handling, duties and taxes, plus cost of inland transportation, dated October 20, 1997 of the CityAssessor of Lucena) is a notice
handling, and installation charges at the present site. The cost in of collection, ending with the request for MERALCO to settle the
foreign currency of imported machinery shall be converted to peso payable amount soon in order to avoid accumulation of penalties.
cost on the basis of foreign currency exchange rates as fixed by It only presented in table form the tax declarations covering the
the Central Bank. machinery, assessed values in the tax declarations in lump sums
Section 225. Depreciation Allowance for Machinery. For for all the machinery, the periods covered, and the taxes and
purposes of assessment, a depreciation allowance shall be made penalties due again in lump sums for all the machinery.
for machinery at a rate not exceeding five percent (5%) of its The Notice of Assessment dated October 20, 1997 issued by
original cost or its replacement or reproduction cost, as the case the City Assessor gave a summary of the new/revised
may be, for each year of use: Provided, however, That the assessment of the "machinery" located in "Quezon Avenue Ext.,
remaining value for all kinds of machinery shall be fixed at not less Brgy. Gulang-Gulang, Lucena City," covered by Tax Declaration
than twenty percent (20%) of such original, replacement, or No. 019-7394, with total market value of P98,173,200.00 and total
assessed value of P78,538,560.00. The Property Record Form
basically contained the same information. Without specific the assessment of its properties by the City Assessor was
description or identification of the machinery covered by said tax baselessly and arbitrarily done, without regard for the
declaration, said Notice of Assessment and Property Record Form requirements of the Local Government Code.
give the false impression that there is only one piece of machinery The exercise of the power of taxation constitutes a deprivation of
covered. property under the due process clause, and the taxpayer's right to
In Tax Declaration No. 019-6500, the City Assessor reported its due process is violated when arbitrary or oppressive methods are
findings under "Building and Improvements" and not "Machinery." used in assessing and collecting taxes. 67 The Court applies by
Said tax declaration covered "capital investment-commercial," analogy its pronouncements in Commissioner of Internal
specifically: (a) Transformer and Electric Post; (b) Transmission Revenue v. United Salvage and Towage (Phils.),
Line, (c) Insulator, and (d) Electric Meter, with a total market value Inc., 68 concerning an assessment that did not comply with the
of P81,811,000.00, assessment level of 80%, and assessed value requirements of the National Internal Revenue Code:
of P65,448,800.00. Conspicuously, the table for "Machinery" On the strength of the foregoing observations, we ought to
requiring the description, date of operation, replacement cost, reiterate our earlier teachings that "in balancing the scales
depreciation, and market value of the machinery is totally blank. between the power of the State to tax and its inherent right to
MERALCO avers, and the City Assessor and the City Treasurer of prosecute perceived transgressors of the law on one side, and the
Lucena do not refute at all, that MERALCO has not been furnished constitutional rights of a citizen to due process of law and the equal
the Owner's Copy of Tax Declaration No. 019-7394, in which the protection of the laws on the other, the scales must tilt in favor of
total market value of the machinery of MERALCO was increased the individual, for a citizen's right is amply protected by the Bill of
by P16,632,200.00, compared to that in Tax Declaration No. 019- Rights under the Constitution." Thus, while "taxes are the lifeblood
6500. of the government," the power to tax has its limits, in spite of all its
The Court cannot help but attribute the lack of a valid notice of plenitude. Even as we concede the inevitability and
assessment to the apparent lack of a valid appraisal and indispensability of taxation, it is a requirement in all democratic
assessment conducted by the City Assessor of Lucena in the first regimes that it be exercised reasonably and in accordance with
place. It appears that the City Assessor of Lucena simply lumped the prescribed procedure. (Citations omitted.)
together all the transformers, electric posts, transmission lines, The appraisal and assessment of the transformers, electric posts,
insulators, and electric meters of MERALCO located in transmission lines, insulators, and electric meters of MERALCO
Lucena City under Tax Declaration Nos. 019-6500 and 019-7394, under Tax Declaration Nos. 019-6500 and 019-7394, not being in
contrary to the specificity demanded under Sections 224 and 225 compliance with the Local Government Code, are attempts at
of the Local Government Code for appraisal and assessment of deprivation of property without due process of law and, therefore,
machinery. The City Assessor and the City Treasurer of Lucena null and void.
did not even provide the most basic information such as the WHEREFORE, premises considered, the Court PARTLY
number of transformers, electric posts, insulators, GRANTS the instant Petition and AFFIRMS with
and electric meters or the length of the transmission lines MODIFICATION the Decision dated May 13, 2004 of the Court of
appraised and assessed under Tax Declaration Nos. 019-6500 Appeals in CA-G.R. SP No. 67027, affirming in toto the Decision
and 019-7394. There is utter lack of factual basis for the dated May 3, 2001 of the Central Board of Assessment Appeals in
assessment of the transformers, electric posts, transmission lines, CBAA Case No. L-20-98. The Court DECLARESthat the
insulators, and electric meters of MERALCO. EATCcI transformers, electric posts, transmission lines, insulators,
The Court of Appeals laid the blame on MERALCO for the lack of and electric meters of Manila Electric Company are NOT
information regarding its transformers, electric posts, transmission EXEMPTED from real property tax under the Local Government
lines, insulators, and electric meters for appraisal and assessment Code. However, the Court also DECLARES the appraisal and
purposes because MERALCO failed to file a sworn declaration of assessment of the said properties under Tax Declaration Nos.
said properties as required by Section 202 of the Local 019-6500 and 019-7394 as NULL and VOID for not complying
Government Code. As MERALCO explained, it cannot be with the requirements of the Local Government Code and violating
expected to file such a declaration when all the while it believed the right to due process of Manila Electric Company,
that said properties were personal or movable properties not and ORDERS the CANCELLATION of the collection letter dated
subject to real property tax. More importantly, Section 204 of the October 16, 1997 of the City Treasurer of Lucena and the Notice
Local Government Code exactly covers such a situation, thus: of Assessment dated October 20, 1997 of the City Assessor of
Section 204. Declaration of Real Property by the Assessor. Lucena, but WITHOUT PREJUDICE to the conduct of a new
When any person, natural or juridical, by whom real property is appraisal and assessment of the same properties by
required to be declared under Section 202 hereof, refuses or fails the City Assessor of Lucena in accord with the provisions of the
for any reason to make such declaration within the time Local Government Code and guidelines issued by the Bureau of
prescribed, the provincial, city or municipal assessor shall himself Local Government Financing.
declare the property in the name of the defaulting owner, if known, SO ORDERED.
or against an unknown owner, as the case may be, and shall ||| (Manila Electric Co. v. City Assessor, G.R. No. 166102, [August
assess the property for taxation in accordance with the provision 5, 2015])
of this Title. No oath shall be required of a declaration thus made
by the provincial, city or municipal assessor. CAPITOL WIRELESS INC v. PROVINCIAL TREASURER OF
Note that the only difference between the declarations of property BATANGAS
made by the taxpayer, on one hand, and the THIRD DIVISION
provincial/city/municipal assessor, on the other, is that the former [G.R. No. 180110. May 30, 2016.]
must be made under oath. After making the declaration of the CAPITOL WIRELESS, INC., petitioner, vs. THE PROVINCIAL T
property himself for the owner, the REASURER OF BATANGAS, THE PROVINCIAL ASSESSOR
provincial/city/municipal assessor is still required to assess the OF BATANGAS, THE MUNICIPAL TREASURERAND
property for taxation in accordance with the provisions of the Local ASSESSOR OF NASUGBU, BATANGAS, respondents.
Government Code. DECISION
It is true that tax assessments by tax examiners are presumed PERALTA, J p:
correct and made in good faith, with the taxpayer having the Before the Court is a petition for review on certiorari under Rule 45
burden of proving otherwise. 66 In this case, MERALCO was able of the Rules of Court seeking to annul and set aside the Court of
to overcome the presumption because it has clearly shown that Appeals' Decision 1 dated May 30, 2007 and Resolution 2 dated
October 8, 2007 in CA-G.R. SP No. 82264, which both denied the Statement of True Value of Real Properties are taxable real
appeal of petitioner against the decision of the Regional Trial property, a determination that was contested by Capwire in an
Court. exchange of letters between the company and the public
Below are the facts of the case. respondent. 12 The reason cited by Capwire is that the cable
Petitioner Capitol Wireless, Inc. (Capwire) is a Philippine system lies outside of Philippine territory, i.e., on international
corporation in the business of providing international waters. 13
telecommunications services. 3 As such provider, Capwire has On February 7, 2003 and March 4, 2003, Capwire received a
signed agreements with other local and foreign Warrant of Levy and a Notice of Auction Sale, respectively, from
telecommunications companies covering an international network the respondent Provincial Treasurer of
of submarine cable systems such as the Asia Pacific Cable Batangas (Provincial Treasurer). 14
Network System (APCN) (which connects Australia, Thailand, On March 10, 2003, Capwire filed a Petition for Prohibition and
Malaysia, Singapore, Hong Kong, Taiwan, Korea, Japan, Declaration of Nullity of Warrant of Levy, Notice of Auction Sale
Indonesia and the Philippines); the Brunei-Malaysia-Philippines and/or Auction Sale with the Regional Trial Court (RTC) of
Cable Network System (BMP-CNS), the Philippines-Italy (SEA- Batangas City. 15 CAIHTE
ME-WE-3 CNS), and the Guam Philippines (GP- After the filing of the public respondents' Comment, 16 on May 5,
CNS) systems. 4 The agreements provide for co-ownership and 2003, the RTC issued an Order dismissing the petition for failure
other rights among the parties over the network. 5 of the petitioner Capwire to follow the requisite of payment under
Petitioner Capwire claims that it is co-owner only of the so-called protest as well as failure to appeal to the Local Board of
"Wet Segment" of the APCN, while the landing stations or Assessment Appeals (LBAA), as provided for in Sections 206 and
terminals and Segment E of APCN located in Nasugbu, Batangas 226 of Republic Act (R.A.) No. 7160, or the Local Government
are allegedly owned by the Philippine Long Distance Telephone Code. 17
Corporation (PLDT). 6 Moreover, it alleges that the Wet Segment Capwire filed a Motion for Reconsideration, 18 but the same was
is laid in international, and not Philippine, waters. 7 likewise dismissed by the RTC in an Order 19 dated August 26,
Capwire claims that as co-owner, it does not own any particular 2003. It then filed an appeal to the Court of Appeals. 20
physical part of the cable system but, consistent with its financial On May 30, 2007, the Court of Appeals promulgated its Decision
contributions, it owns the right to use a certain capacity of the said dismissing the appeal filed by Capwire and affirming the order of
system. 8 This property right is allegedly reported in its financial the trial court. The dispositive portion of the CA's decision states:
books as "Indefeasible Rights in Cable Systems." 9 WHEREFORE, premises considered, the assailed Orders dated
However, for loan restructuring purposes, Capwire claims that "it May 5, 2003 and August 26, 2003 of the Regional Trial Court,
was required to register the value of its right," hence, it engaged Branch II of Batangas City, are AFFIRMED.
an appraiser to "assess the market value of the international SO ORDERED. 21
submarine cable system and the cost to Capwire." 10 On May 15, The appellate court held that the trial court correctly dismissed
2000, Capwire submitted a Sworn Statement of True Value of Real Capwire's petition because of the latter's failure to comply with the
Properties at the ProvincialTreasurer's Office, Batangas City, requirements set in Sections 226 and 229 of the Local
Batangas Province, for the Wet Segment of the system, stating: Government Code, that is, by not availing of remedies before
administrative bodies like the LBAA and the Central Board of
System Sound Value
Assessment Appeals (CBAA). 22Although Capwire claims that it
saw no need to undergo administrative proceedings because its
petition raises purely legal questions, the appellate court did not
APCN P203,300,000.00 share this view and noted that the case raises questions of fact,
such as the extent to which parts of the submarine cable system
BMP-CNS P65,662,000.00 lie within the territorial jurisdiction of the taxing authorities, the
public respondents. 23 Further, the CA noted that Capwire failed
SEA-ME-WE-3 CNSP P7,540,000.00 to pay the tax assessed against it under protest, another strict
requirement under Section 252 of the Local Government Code. 24
GP-CNS P1,789,000.00 Hence, the instant petition for review of Capwire.
Petitioner Capwire asserts that recourse to the Local Board of
Assessment Appeals, or payment of the tax under protest, is
Capwire claims that it also reported that the system "interconnects inapplicable to the case at bar since there is no question of fact
at the PLDT Landing Station in Nasugbu, Batangas," which is involved, or that the question involved is not the reasonableness
covered by a transfer certificate of title and tax declarations in the of the amount assessed but, rather, the authority and power of the
name of PLDT. 11 assessor to impose the tax and of the treasurer to collect it. 25 It
As a result, the respondent Provincial Assessor of contends that there is only a pure question of law since the issue
Batangas (Provincial Assessor) issued the following Assessments is whether its submarine cable system, which it claims lies in
of Real Property (ARP) against Capwire: international waters, is taxable. 26 Capwire holds the position that
ARP Cable System Assessed Value the cable system is not subject to tax. 27
Respondents assessors and treasurers of the Province of
Batangas and Municipality of Nasugbu, Batangas disagree with
Capwire and insist that the case presents questions of fact such
019-00967 BMP-CNS P52,529,600.00 as the extent and portion of the submarine cable system that lies
within the jurisdiction of the said local governments, as well as the
019-00968 APCN P162,640,000.00 nature of the so-called indefeasible rights as property of
Capwire. 28 Such questions are allegedly resolvable only before
019-00969 SEA-ME-WE3-CNS P6,032,000.00 administrative agencies like the Local Board of Assessment
Appeals. 29
019-00970 GP-CNS P1,431,200.00 The Court confronts the following issues: Is the case cognizable
by the administrative agencies and covered by the requirements
In essence, the Provincial Assessor had determined that the in Sections 226 and 229 of the Local Government Code which
submarine cable systems described in Capwire's Sworn makes the dismissal of Capwire's petition by the RTC proper? May
submarine communications cables be classified as taxable real controversy," that is, "whether or not an indefeasible right over a
property by the local governments? submarine cable system that lies in international waters can be
The petition is denied. No error attended the ruling of the appellate subject to real property tax in the Philippines," 35 is not the
court that the case involves factual questions that should have genuine issue that the case presents as it is already obvious
been resolved before the appropriate administrative bodies. and fundamental that real property that lies outside of Philippine
In disputes involving real property taxation, the general rule is to territorial jurisdiction cannot be subjected to its domestic and
require the taxpayer to first avail of administrative remedies and sovereign power of real property taxation but, rather, such
pay the tax under protest before allowing any resort to a judicial factual issues as the extent and status of Capwire's ownership of
action, except when the assessment itself is alleged to be illegal the system, the actual length of the cable/s that lie in Philippine
or is made without legal authority. 30 For example, prior resort to territory, and the corresponding assessment and taxes due on the
administrative action is required when among the issues raised is same, because the public respondents imposed and collected the
an allegedly erroneous assessment, like when the assailed real property tax on the finding that at least a portion or
reasonableness of the amount is challenged, while direct court some portions of the submarine cable system that Capwire owns
action is permitted when only the legality, power, validity or or co-owns lies inside Philippine territory. Capwire's disagreement
authority of the assessment itself is in question. 31 Stated with such findings of the administrative bodies presents little to no
differently, the general rule of a prerequisite recourse to legal question that only the courts may directly resolve. HEITAD
administrative remedies applies when questions of fact are raised, Instead, Capwire argues and makes claims on mere assumptions
but the exception of direct court action is allowed when purely of certain facts as if they have been already admitted or
questions of law are involved. 32 established, when they have not, since no evidence of such have
This Court has previously and rather succinctly discussed the yet been presented in the proper agencies and even in the current
difference between a question of fact and a question of law. petition. As such, it remains unsettled whether Capwire is a mere
In Cosmos Bottling Corporation v. Nagrama, Jr., 33it held: co-owner, not full owner, of the subject submarine cable and, if the
The Court has made numerous dichotomies between questions of former, as to what extent; whether all or certain portions of the
law and fact. A reading of these dichotomies shows that labels cable are indeed submerged in water; and whether the waters
attached to law and fact are descriptive rather than definitive. We wherein the cable/s is/are laid are entirely outside of Philippine
are not alone in Our difficult task of clearly distinguishing questions territorial or inland waters, i.e., in international waters. More
of fact from questions of law. The United States Supreme Court simply, Capwire argues based on mere legal conclusions,
has ruled that: "we [do not] yet know of any other rule or principle culminating on its claim of illegality of respondents' acts, but the
that will unerringly distinguish a factual finding from a legal conclusions are yet unsupported by facts that should have been
conclusion." threshed out quasi-judicially before the administrative agencies. It
In Ramos v. Pepsi-Cola Bottling Co. of the P.I., the Court ruled: has been held that "a bare characterization in a petition of
There is a question of law in a given case when the doubt or unlawfulness, is merely a legal conclusion and a wish of the
difference arises as to what the law is on a certain state of facts; pleader, and such a legal conclusion unsubstantiated by facts
there is a question of fact when the doubt or difference arises as which could give it life, has no standing in any court where issues
to the truth or the falsehood of alleged facts. DETACa must be presented and determined by facts in ordinary and
We shall label this the doubt dichotomy. concise language." 36 Therefore, Capwire's resort to judicial
In Republic v. Sandiganbayan, the Court ruled: action, premised on its legal conclusion that its cables (the
. . . A question of law exists when the doubt or controversy equipment being taxed) lie entirely on international waters, without
concerns the correct application of law or jurisprudence to a first administratively substantiating such a factual premise, is
certain set of facts; or when the issue does not call for an improper and was rightly denied. Its proposition that the cables lie
examination of the probative value of the evidence presented, the entirely beyond Philippine territory, and therefore, outside of
truth or falsehood of facts being admitted. In contrast, a question Philippine sovereignty, is a fact that is not subject to judicial notice
of fact exists when the doubt or difference arises as to the truth or since, on the contrary, and as will be explained later, it is in fact
falsehood of facts or when the query invites calibration of the certain that portions of the cable would definitely lie within
whole evidence considering mainly the credibility of the witnesses, Philippine waters. Jurisprudence on the Local Government
the existence and relevancy of specific surrounding circumstances Code is clear that facts such as these must be threshed out
as well as their relation to each other and to the whole, and the administratively, as the courts in these types of cases step in at
probability of the situation. the first instance only when pure questions of law are involved.
For the sake of brevity, We shall label this the law application and Nonetheless, We proceed to decide on whether submarine wires
calibration dichotomy. or cables used for communications may be taxed like other real
In contrast, the dynamic legal scholarship in the United States has estate.
birthed many commentaries on the question of law and question We hold in the affirmative.
of fact dichotomy. As early as 1944, the law was described as Submarine or undersea communications cables are akin to electric
growing downward toward "roots of fact" which grew upward to transmission lines which this Court has recently declared in Manila
meet it. In 1950, the late Professor Louis Jaffe saw fact and law as Electric Company v. City Assessor and City Treasurer of Lucena
a spectrum, with one shade blending imperceptibly into the other. City, 37 as "no longer exempted from real property tax" and may
Others have defined questions of law as those that deal with the qualify as "machinery" subject to real property tax under the Local
general body of legal principles; questions of fact deal with "all Government Code. To the extent that the equipment's location is
other phenomena . . . ." Kenneth Culp Davis also weighed in and determinable to be within the taxing authority's jurisdiction, the
noted that the difference between fact and law has been Court sees no reason to distinguish between submarine cables
characterized as that between "ought" questions and "is" used for communications and aerial or underground wires or lines
questions. 34 used for electric transmission, so that both pieces of property do
Guided by the quoted pronouncement, the Court sustains the CA's not merit a different treatment in the aspect of real property
finding that petitioner's case is one replete with questions of fact taxation. Both electric lines and communications cables, in the
instead of pure questions of law, which renders its filing in a judicial strictest sense, are not directly adhered to the soil but pass
forum improper because it is instead cognizable by local through posts, relays or landing stations, but both may be
administrative bodies like the Board of Assessment Appeals, classified under the term "machinery" as real property under
which are the proper venues for trying these factual issues. Verily, Article 415 (5) 38 of the Civil Code for the simple reason that such
what is alleged by Capwire in its petition as "the crux of the pieces of equipment serve the owner's business or tend to meet
the needs of his industry or works that are on real estate. Even Thus, the jurisdiction or authority over such part of the subject
objects in or on a body of water may be classified as such, as submarine cable system lying within Philippine jurisdiction
"waters" is classified as an immovable under Article 415 (8) 39 of includes the authority to tax the same, for taxation is one of the
the Code. A classic example is a boathouse which, by its nature, three basic and necessary attributes of sovereignty, 49 and such
is a vessel and, therefore, a personal property but, if it is tied to the authority has been delegated by the national legislature to the local
shore and used as a residence, and since it floats on waters which governments with respect to real property taxation. 50
is immovable, is considered real property. 40 Besides, the Court As earlier stated, a way for Capwire to claim that its cable system
has already held that "it is a familiar phenomenon to see things is not covered by such authority is by showing a domestic
classed as real property for purposes of taxation which on general enactment or even contract, or an international agreement or
principle might be considered personal property." 41 treaty exempting the same from real property taxation. It failed to
Thus, absent any showing from Capwire of any express grant of do so, however, despite the fact that the burden of proving
an exemption for its lines and cables from real property taxation, exemption from local taxation is upon whom the subject real
then this interpretation applies and Capwire's submarine cable property is declared. 51 Under the Local Government Code, every
may be held subject to real property tax. person by or for whom real property is declared, who shall claim
Having determined that Capwire is liable, and public respondents tax exemption for such property from real property taxation "shall
have the right to impose a real property tax on its submarine cable, file with the provincial, city or municipal assessor within thirty (30)
the issue that is unresolved is how much of such cable is taxable days from the date of the declaration of real property sufficient
based on the extent of Capwire's ownership or co-ownership of it documentary evidence in support of such claim." 52 Capwire
and the length that is laid within respondents' taxing jurisdiction. omitted to do so. And even under Capwire's legislative
The matter, however, requires a factual determination that is best franchise, RA 4387, which amended RA 2037, where it may be
performed by the Local and Central Boards of Assessment derived that there was a grant of real property tax exemption for
Appeals, a remedy which the petitioner did not avail of. properties that are part of its franchise, or directly meet the needs
At any rate, given the importance of the issue, it is proper to lay of its business, 53 such had been expressly withdrawn by
down the other legal bases for the local taxing authorities' power the Local Government Code, which took effect on January 1,
to tax portions of the submarine cables of petitioner. It is not in 1992, Sections 193 and 234 of which provide: 54
dispute that the submarine cable system's Landing Station in Section 193. Withdrawal of Tax Exemption Privileges. Unless
Nasugbu, Batangas is owned by PLDT and not by Capwire. otherwise provided in this Code, tax exemptions or incentives
Obviously, Capwire is not liable for the real property tax on this granted to, or presently enjoyed by all persons, whether
Landing Station. Nonetheless, Capwire admits that it co-owns the natural or juridical, including government-owned or
submarine cable system that is subject of the tax assessed and controlled corporations, except local water districts,
being collected by public respondents. As the Court takes judicial cooperatives duly registered under R.A. No. 6938, non-stock
notice that Nasugbu is a coastal town and the surrounding sea falls and nonprofit hospitals and educational institutions, are
within what the United Nations Convention on the Law of the hereby withdrawn upon the effectivity of this Code.
Sea (UNCLOS) would define as the country's territorial sea (to the xxx xxx xxx
extent of 12 nautical miles outward from the nearest baseline, Section 234. Exemptions from Real Property Tax. The following
under Part II, Sections 1 and 2) over which the country has are exempted from payment of the real property tax:
sovereignty, including the seabed and subsoil, it follows that (a) Real property owned by the Republic of the Philippines or any
indeed a portion of the submarine cable system lies within of its political subdivisions except when the beneficial use thereof
Philippine territory and thus falls within the jurisdiction of the said has been granted, for consideration of otherwise, to a taxable
local taxing authorities. 42 It easily belies Capwire's contention person;
that the cable system is entirely in international waters. And even (b) Charitable institutions, churches, parsonages or convents
if such portion does not lie in the 12-nautical-mile vicinity of the appurtenant thereto, mosques, nonprofit or religious cemeteries
territorial sea but further inward, in Prof. Magallona v. Hon. Ermita, and all lands, buildings, and improvements actually, directly, and
et al. 43 this Court held that "whether referred to as Philippine exclusively used for religious, charitable or educational purposes;
'internal waters' under Article I of the Constitution 44 or as (c) All machineries and equipment that are actually, directly and
'archipelagic waters' under UNCLOS Part III, Article 49 (1, 2, exclusively used by local water districts and government-owned or
4), 45 the Philippines exercises sovereignty over the body of water controlled corporations engaged in the supply and distribution of
lying landward of (its) baselines, including the air space over it and water and/or generation and transmission of electric power;
the submarine areas underneath." Further, under Part VI, Article (d) All real property owned by duly registered cooperatives as
79 46 of the UNCLOS, the Philippines clearly has jurisdiction with provided for under R.A. No. 6938; and
respect to cables laid in its territory that are utilized in support of (e) Machinery and equipment used for pollution control and
other installations and structures under its jurisdiction. ATICcS environmental protection.
And as far as local government units are concerned, the areas Except as provided herein, any exemption from payment of
described above are to be considered subsumed under the term real property tax previously granted to, or presently enjoyed
"municipal waters" which, under the Local Government Code, by, all persons, whether natural or juridical, including all
includes "not only streams, lakes, and tidal waters within the government-owned or controlled corporations are hereby
municipality, not being the subject of private ownership and not withdrawn upon the effectivity of this Code. 55
comprised within the national parks, public forest, timber lands, Such express withdrawal had been previously held effective upon
forest reserves or fishery reserves, but also marine waters exemptions bestowed by legislative franchises granted prior to the
included between two lines drawn perpendicularly to the general effectivity of the Local Government Code. 56Capwire fails to
coastline from points where the boundary lines of the municipality allege or provide any other privilege or exemption that were
or city touch the sea at low tide and a third line parallel with the granted to it by the legislature after the enactment of the Local
general coastline and fifteen (15) kilometers from it." 47Although Government Code. Therefore, the presumption stays that it enjoys
the term "municipal waters" appears in the Code in the context of no such privilege or exemption. Tax exemptions are strictly
the grant of quarrying and fisheries privileges for a fee by local construed against the taxpayer because taxes are considered the
governments, 48 its inclusion in the Code's Book II which covers lifeblood of the nation. 57
local taxation means that it may also apply as guide in determining WHEREFORE, the petition is DENIED. The Court of Appeals'
the territorial extent of the local authorities' power to levy real Decision dated May 30, 2007 and Resolution dated October 8,
property taxation. 2007 are AFFIRMED.
SO ORDERED. TIADC
||| (Capitol Wireless, Inc. v. Provincial Treasurer of Batangas, G.R.
No. 180110, [May 30, 2016])