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 Cea obtained a loan from Villanueva wherein a Real Estate  WON Villanueva’s possession of Parcel No. 2 was in good faith
Possessor in Mortgage was executed by Cea as security
good faith is not  Having failed to settle his obligation, Villanueva brought an YES. VILLANUEVA IS A POSSESSOR IN GOOD FAITH
liable for any action to foreclose the mortgage.  Since it was settled that Parcel No. 2 was included in the mortgage
fortuitous event  With this, the parcels of land covered by the mortgage were executed by Cea, it is clear that Villanueva has acquired it in good
offered for public sale and were sold to Villanueva as highest faith by virtue of public sale
bidder  The SC applied the case of Bischoff v Pomar when it ruled that “in
 However, upon delivering possession of said parcel No. 2 to a mortgage of real estate, the improvements on the same are
Villanueva, the sheriff found that there was a house built upon included; therefore, all objects permanently attached to a
said lot, which house was not specifically mentioned in the mortgaged building or land, although they may have been placed
description of parcel No. 2, although the land upon which it there after the mortgage was constituted, are also included”
stood was clearly within the description of said parcel as
 Fearing that by reason of the failure of such description SALE
specifically to mention the house in question, the sheriff is  When Villanueva entered into possession of the property after he
doubtful that his power did not extend to the delivery of the had purchased it at the foreclosure sale, thus, it is presumed that
possession of said house. he entered into possession honestly and in good faith
- With this, the sheriff informed the Villanueva that, in the  No direct evidence is given anywhere attacking his motives or his
event that the court should determine that said house was intentions
not property embraced within the mortgage and legally  When Villanueva took possession he did so as owner of the
conveyed under the mortgage sale, Villanueva must not property and, even if the mortgage sale had been absolutely void,
only deliver possession but also pay to Cea a proper sum he would still have been a holder in good faith, being a mortgagee
for its occupancy in possession under direction of the court
 To fully transfer the possession of the property to Villanueva,  Villanueva having entered into possession of the property
the sheriff advised the caretaker of Cea to leave the property. lawfully, he was obligated to exercise only reasonable diligence
- However, the caretaker refused to leave as there are and care in the management of the property.
certain articles that he needs to take care of so he asked
permission to the sheriff if he can stay on the subject VILLANUEVA, BEING A POSSESSOR IN GOOD FAITH, IS NOT LIABLE
 As provided in Art. 457 possessor in good faith is not liable for the
- The sheriff informed the caretaker that he has no power to deterioration or loss of the thing possessed, with the exception of
grant such request so he referred such request to
the cases in which it is proved that he has acted with fraudulent
intent. A possessor in bad faith is liable for the deterioration or
- Villanueva, in turn, allowed the caretaker to stay on the loss in any case, even in those caused by force majeure, when he
property. Also, Villanueva placed his own caretaker to has maliciously delayed the delivery of the thing to its legitimate
protect it from any injury or destruction possessor
 On October 1906, the house located on parcel No. 2 was  In this case, since Villanueva is not a holder in bad faith, he is
destroyed by fire. The cause of fire or through whose fault or responsible only for losses which are shown to have caused by his
negligence, if any, was not found in the records of the case negligence
 Since no negligence having been shown in this case, Villanueva is
ARGUMENTS OF CEA not liable for any damages incurred in the property.
 That Villanueva entered into the possession of a house and lot
belonging to Cea by gross negligence and carelessness, caused
it to be burned to the damage of Cea
 Villanueva entered into the subject property knowing that they
were not entitled to the possession thereof, and acting,
therefore, in bad faith, they were responsible to Cea for the
destruction of the house by fire.