G.R. No.

L-47475 - August 19, 1988

MANOTOK REALTY, INC., petitioner, vs. THE HONORABLE
JOE H. TECON, Ju!g" o# t$" Cou%t o# &'%st I(st)(*"
o# M)('+) )(! NILO MA,LANGA-A, respondents.
G.TIERRE/, JR., J.0
&ACT
Petitioner (MANOTOK) fled a complaint for recovery of
possession and damages against the private
respondent (N!O MA"!AN#A$A), the then %o&rt of
'irst nstance of Manila rendered (&dgment, declaring
the defendant Nilo Madlanga)a as a *&ilder or
possessor in good faith+ ordering the plainti, to
recogni-e the right of said defendant to remain in !ot
No. ./0, 1loc2 3, of the %lara Tam*&nting 4&*division
&ntil after he shall have *een reim*&rsed *y the
plainti, the s&m of P5,066.66, )itho&t prono&ncement
as to costs.
Not satisfed )ith the trial co&rt7s decision, the
petitioner appealed to the %o&rt of Appeals and &pon
a8rmance *y the latter of the decision in favor of the
private respondent, the petitioner elevated its case to
this %o&rt.
On 3. 9&ly 3:55, the 4&preme %o&rt iss&ed a
resol&tion dated 33 9&ly 3:55 denying the company;s
petition for lac2 of merit.
On 0 A&g&st 3:55, the company fled )ith the trial
co&rt (9&dge 9ose <. Tecson), a motion for the approval
of the company;s e=ercise of option and for
satisfaction of (&dgment, praying that the co&rt iss&e
an order>
a) approving the e=ercise of the company;s option
to appropriate the improvements introd&ced *y
Madlanga)a on the property+
*) thereafter, Madlanga)a *e ordered to deliver
possession of the property in ?&estion to the
company.
On 5 Octo*er 3:55, the (&dge held that in vie) of
pec&liar circ&mstances )hich s&pervened the
instit&tion of the case, li2e the introd&ction of certain
repairs of and other s&*stantial improvements on the
controverted property, the instant motion of the
plainti, is not )ell@ta2en and therefore not legally
proper and tena*le.
After a denial of its motion for reconsideration, the
petitioner fled the present petition for mandam&s
alleging that the respondent (&dge committed grave
a*&se of discretion in denying his motion to e=ercise
option and for e=ec&tion of (&dgment on the gro&nds
that &nder Articles //A and 0/B of the %ivil %ode, the
e=ercise of option *elongs to the o)ner of the
property, )ho is the petitioner herein, and that &pon
fnality of (&dgment, the prevailing party is entitled, as
a matter of right, to its e=ec&tion )hich is only a
ministerial act on the part of the respondent (&dge.
On April 30, 3:5A, the private respondent fled his
comment on the petition alleging that the same has
already *ecome moot and academic for t)o reasons>
'irst, fre g&tted not only the ho&se of the
private respondent *&t the ma(ority of the
ho&ses in Tam*&nting Cstate+ and
4econd, as a res&lt of the said fre, the then 'irst
!ady and Metro Manila #overnor melda D.
Marcos has placed the disp&ted area &nder her
Eonal mprovement Pro(ect, there*y allo)ing the
victims of the fre to p&t &p ne) str&ct&res on
the premises, so that the )illingness and
readiness of the petitioner to e=ercise the
alleged option can no longer *e e=ercised since
the s&*(ect@matter thereof has *een
e=ting&ished *y the fre.
On "ecem*er FA, 3:A6, Presidential "ecree (P.".) No.
3BB: )as iss&ed providing for the e=propriation of the
Tam*&nting Cstate. <o)ever, this decree )as
challenged *efore this %o&rt in #.D. No, 003BB entitled
The GClisa D. Manoto2, et al. v. National <o&sing
A&thority, et al.G
On May F3, 3:A5, the %o&rt rendered a decision in the
Clisa Manoto2 case (Manoto2 v. National <o&sing
A&thority, 306 4%DA A:) r&ling that P.". 3BB: is
&nconstit&tional for *eing violative of the d&e process
cla&se. The present petition has not *een rendered
moot and academic *y the decision in Manoto2 v. N<A.
As stated earlier, the petitioner arg&es that since the
(&dgment of the trial co&rt has already *ecome fnal, it
is entitled to the e=ec&tion of the same and that
moreover, since the ho&se of the private respondent
)as g&tted *y fre, the e=ec&tion of the decision )o&ld
no) involve the delivery of possession of the disp&ted
area *y the private respondent to the petitioner.
I.E
$hether or not there sho&ld *e a delivery of
possession *y the respondent to the petitioner
R.LING
$hen the decision of the trial co&rt *ecame fnal and
e=ec&tory, it *ecomes inc&m*ent &pon the respondent
(&dge to iss&e the necessary )rit for the e=ec&tion of
the same.
The repairs and improvements introd&ced *y the said
respondents after the complaint )as fled cannot *e
considered to have *een *&ilt in good faith, m&ch less,
(&stify the denial of the petitioner7s fai@rn of option.
4ince the improvements have *een g&tted *y fre, and
therefore, the *asis for private respondent7s right to
retain the premises has already *een e=ting&ished
)itho&t the fa&lt of the petitioner, there is no other
reco&rse for the private respondent *&t to vacate the
premises and deliver the same to the petitioner.
$<CDC'ODC, N HC$ O' T<C 'ODC#ON#, the petition
is #DANTC" and the respondent (&dge is here*y
ordered to immediately iss&e a )rit of e=ec&tion
ordering the private respondent to vacate the disp&ted
premises and deliver possession of the same to the
petitioner.
G.R. No. L-49119 - A2%'+ 15, 1988
3O.E CONCE3CION &ERNAN,E/ ,EL CAM3O )(!
ETANILAO ,EL CANTO, plainti,s@appellees, vs.
BERNAR,A &ERNAN,E/ ABEIA, defendant@appellant.
GANCAYCO, J.0
&ACT
This case involves a parcel of land, !ot No. 33B3 of the
%adastral 4&rvey of %e*&, )ith an area of only a*o&t
/0 s?&are meters, sit&ated at the corner of '. 'lores
and %avan 4treets, %e*& %ity covered *y T%T No.
B3A06.
An action for partition )as fled *y plainti,s in the %'
of %e*&. Plainti,s and defendants are co@o)ners pro
indiviso of this lot in the proportion of and 3I. share
each, respectively.
The trial co&rt appointed a commissioner in
accordance )ith the agreement of the parties. ,the d
commissioner cond&cted a s&rvey, prepared a s2etch
plan and s&*mitted a report to the trial co&rt on May
F:, 3:5B, recommending that the property *e divided
into t)o lots> !ot 33B3@A )ith an area of .6 s?&are
meters for plainti,s and !ot No. 33B3@1 )ith an area of
30 s?&are meters for the defendants.
The ho&ses of plainti,s and defendants )ere s&rveyed
and sho)n on the s2etch plan.
The ho&se of defendants occ&pied the portion )ith an
area of 0 s?&are meters of !ot 33B3@A of plainti,s.
The parties manifested their conformity to the report
and as2ed the trial co&rt to fnally settle and
ad(&dicate )ho among the parties sho&ld ta2e
possession of the 0 s?&are meters of the land in
?&estion.
9&dgment is here*y rendered assigning !ot 33B3@A
)ith an area of thirty (.6) s?. meters to the plainti,s
spo&ses %oncepcion 'ernande- A*esia, !o&rdes
'ernande- Dodil, #enaro 'ernande- and "ominga A.
'ernande-, in the respective metes and *o&nds as
sho)n in the s&*division s2etch plan attached to the
%ommissioner7s Deport dated may F:, 3:5B prepared
*y the %ommissioner, #eodetic Cngineer Cspirit&
1&nagan.
'&rther, the defendants are here*y ordered at their
e=pense to remove and demolish part of their ho&se
)hich has encroached an area of fve (0) s?&are
meters from !ot 33B3@A of the plainti,s+ )ithin si=ty
(B6) days from date hereof and to deliver the
possession of the same to the plainti,s. <ence,
Petition.
I.E
$hether or not the provisions of Article //A of the %ivil
%ode is applica*le to the case relating to a *&ilder in
good faith )hen the property involved is o)ned in
common.
R.LING
The r&le of accession applies *eca&se co@o)nership
)as terminated &pon the partitioning of the lot. Art
//A therefore governs.
The co&rt a ?&o correctly held that Article //A of the
%ivil %ode cannot apply )here a co@o)ner *&ilds,
plants or so)s on the land o)ned in common for then
he did not *&ild, plant or so) &pon land that
e=cl&sively *elongs to another *&t of )hich he is a co@
o)ner. The co@o)ner is not a third person &nder the
circ&mstances, and the sit&ation is governed *y the
r&les of co@o)nership.
Ho4"5"%, 4$"(, )s '( t$'s *)s", the co@o)nership is
terminated *y the partition and it appears that the
ho&se of defendants overlaps or occ&pies a portion of
0 s?&are meters of the land pertaining to plainti,s
)hich the defendants o*vio&sly *&ilt in good faith,
then the provisions of Article //A of the ne) %ivil %ode
sho&ld apply. M)(%"s) )(! N)5)%%o A6)(!' )g%""
t$)t t$" s)'! 2%o5's'o( o# t$" C'5'+ Co!" 6)7
)22+7 "5"( 4$"( t$"%" 4)s *o-o4("%s$'2 '# goo!
#)'t$ $)s 8""( "st)8+'s$"!.
$<CDC'ODC, the decision appealed from is here*y
MO"'C" *y ordering plainti, to indemnify defendants
for the val&e of the d portion of the ho&se of
defendants in accordance )ith Article 0/B of the %ivil
%ode, if plainti,s elect to appropriate the same.
Other)ise, the defendants shall pay the val&e of the 0
s?&are meters of land occ&pied *y their ho&se at s&ch
price as may *e agreed &pon )ith plainti,s and if its
val&e e=ceeds the portion of the ho&se that
defendants *&ilt thereon, the defendants may choose
not to *&y the land *&t defendants m&st pay a
reasona*le rental for the &se of the portion of the land
of plainti,s As may *e agreed &pon *et)een the
parties. n case of disagreement, the rate of rental
shall *e determined *y the trial co&rt. Other)ise,
defendants may remove or demolish at their o)n
e=pense the said portion of their ho&se. No costs.
G.R. No. 115814 M)7 19, 1995
3E,RO 3. 3ECON, petitioner, vs. CO.RT O& A33EAL,
3O.E J.AN N.G.I, )(! ERLIN,A N.G.I,,
respondents.
,A:I,E, JR., J.
&ACT
Pedro P. Pecson )as the o)ner of a commercial lot
located in Kamias 4treet, J&e-on %ity, on )hich he
*&ilt a /@door F@storey apartment *&ilding. 'or his
fail&re to pay realty ta=es amo&nting to P3F,666.66,
the lot )as sold at p&*lic a&ction *y the %ity Treas&rer
of J&e-on %ity to Mamerto Nepom&ceno )ho in t&rn
sold it on 3F Octo*er 3:A. to the spo&ses 9&an N&g&id
and Crlinda Tan@N&g&id, for P36.,666.66.
Pecson challenged the validity of the a&ction sale
*efore the DT% J&e-on %ity. n its decision of A
'e*r&ary 3:A:, the DT% dismissed the complaint, *&t
as to the N&g&id;s claim that the sale incl&ded the
apartment *&ilding, it held that the iss&e concerning it
)as Knot a s&*(ect of the litigation.L n resolving
N&g&id;s motion to reconsider this iss&e, the trial co&rt
held that there )as no legal *asis for the contention
that the apartment *&ilding )as incl&ded in the sale.
1oth parties then appealed the decision to the %o&rt of
Appeals (%A@#D %H F:.)3. n its decision of .6 April
3::F, the %o&rt of Appeals a8rmed in toto the
assailed decision. t also agreed )ith the trial co&rt
that the apartment *&ilding )as not incl&ded in the
a&ction sale of the commercial lot.
Cntry of (&dgment )as made on F. 9&ne 3::..
On Novem*er 3::., N&g&id fled )ith the trial co&rt a
motion for delivery of possession of the lot and the
apartment *&ilding, citing Article 0/B of the %ivil %ode.
Acting thereon, the trial co&rt iss&ed on 30 Novem*er
3::. the challenged order, ordering N&g&id to
reim*&rse Pecson the constr&ction cost of P0.,666 and
&pon s&ch payment, N&g&id is entitled to immediate
iss&ance of a )rit of possession over the lot and
improvements thereon. The %o&rt also held that as
N&g&id has *een declared the &ncontested o)ner of
the lot in ?&estion as per Cntry of 9&dgment of the
4&preme %o&rt dated F. 9&ne 3::., Pecson sho&ld pay
to N&g&id rent of no less than PF3,666.66 per month
from said date (as this is the very same amo&nt paid
monthly *y the tenants occ&pying the lot), s&ch rent
*eing o,set against the amo&nt pertaining to the
constr&ction cost.
The petitioner moved for the reconsideration of the
order *&t it )as not acted &pon *y the trial co&rt.
nstead, on 3A Novem*er 3::., it iss&ed a )rit of
possession directing the dep&ty sheri, Gto place said
movant 9&an N&g&id in possession of s&*(ect property
located at No. 5: Kamias Doad, J&e-on %ity, )ith all
the improvements thereon and to e(ect therefrom all
occ&pants therein, their agents, assignees, heirs and
representatives.G
The petitioner then fled )ith the %o&rt of Appeals a
special civil action for certiorari and prohi*ition
assailing the order of 30 Novem*er 3::.
n its decision of 5 9&ne 3::/, the %o&rt of Appeals
a8rmed in part the order of the trial co&rt citing Article
//A of the %ivil %ode.
The parties agree that the petitioner )as a *&ilder in
good faith of the apartment *&ilding on the theory that
he constr&cted it at the time )hen he )as still the
o)ner of the lot.
The trial co&rt and the %o&rt of Appeals, as )ell as the
parties, concerned themselves )ith the application of
Articles //A and 0/B of the %ivil %ode.
I.E
$hether or not Articles //A and 0/B 6f the %ivil %ode
are applica*le in the present case.
R.LING
Article //A does not apply to a case )here the o)ner
of the land is the *&ilder, so)er, or planter )ho then
later loses o)nership of the land *y sale or donation.
The tr&e o)ner himself is the *&ilder of )or2s on his
o)n land, the iss&e of good faith or *ad faith is entirely
irrelevant.
Nevertheless, )e *elieve that the provision therein on
indemnity may *e applied *y analogy considering that
the primary intent of Article //A is to avoid a state of
forced co@o)nership and that the parties, incl&ding the
t)o co&rts *elo), in the main agree that Articles //A
and 0/B of the %ivil %ode are applica*le and indemnity
for the improvements may *e paid altho&gh they di,er
as to the *asis of the indemnity.
Article 0/B does not specifcally state ho) the val&e of
the &sef&l improvements sho&ld *e determined.
n the present case, the lo)er co&rt erred in holding
the cost of constr&ction of the apartment *&ilding in
3:B0, and not its c&rrent mar2et val&e, is s&8cient
reim*&rsement for necessary and &sef&l
improvements made *y Pecson.
The trial co&rt also erred in ordering the petitioner to
pay monthly rentals e?&al to the aggregate rentals
paid *y the lessees of the apartment *&ilding. 4ince
the private respondents have opted to appropriate the
apartment *&ilding, the petitioner is th&s entitled to
the possession and en(oyment of the apartment
*&ilding, &ntil he is paid the proper indemnity, as )ell
as of the portion of the lot )here the *&ilding has *een
constr&cted.
The petitioner not having *een so paid, he )as entitled
to retain o)nership of the *&ilding and, necessarily,
the income therefrom.
t follo)s, too, that the %o&rt of Appeals erred not only
in &pholding the trial co&rt7s determination of the
indemnity, *&t also in ordering the petitioner to
acco&nt for the rentals of the apartment *&ilding from
F. 9&ne 3::. to F. 4eptem*er 3::..
$<CDC'ODC, the decision of the %o&rt of Appeals in
%A@#.D. 4P No. .FB5: and the Order of 30 Novem*er
3::. of the Degional Trial %o&rt, 1ranch 363, J&e-on
%ity in %ivil %ase No. J@/3/56 are here*y 4CT A4"C.
The case is here*y remanded to the trial co&rt for it to
determine the c&rrent mar2et val&e of the apartment
*&ilding on the lot. 'or this p&rpose, the parties shall
*e allo)ed to add&ce evidence on the c&rrent mar2et
val&e of the apartment *&ilding. The val&e so
determined shall *e forth)ith paid *y the private
respondents to the petitioner other)ise the petitioner
shall *e restored to the possession of the apartment
*&ilding &ntil payment of the re?&ired indemnity.
;G.R. No. 151815. &"8%u)%7 1<, 1==5>
3O.E J.AN N.G.I, AN, ERLIN,A T. N.G.I,,
petitioners, vs. HON. CO.RT O& A33EAL AN, 3E,RO
3. 3ECON, respondents.
?.I.MBING J0
&ACT
Co(t'(u)t'o(0 @&)*ts A 3"*so( 5s. CA, 2s.
Nugu'!B
n the decision, in the case of Pecson vs. %A, The %o&rt
pointed o&t that> (3) Article //A of the %ivil %ode is not
apposite to the case at *ar )here the o)ner of the
land is the *&ilder, so)er, or planter )ho then later
lost o)nership of the land *y sale, *&t may, ho)ever,
*e applied *y analogy+ (F) the c&rrent mar2et val&e of
the improvements sho&ld *e made as the *asis of
reim*&rsement+ (.) Pecson )as entitled to retain
o)nership of the *&ilding and, necessarily, the income
therefrom+ (/) the %o&rt of Appeals erred not only in
&pholding the trial co&rt;s determination of the
indemnity, *&t also in ordering Pecson to acco&nt for
the rentals of the apartment *&ilding from 9&ne F.,
3::. to 4eptem*er F., 3::..
On the *asis of this %o&rt;s decision in #.D. No.
330A3/, Pecson fled a Motion to Destore Possession
and a Motion to Dender Acco&nting, praying
respectively for restoration of his possession over the
s&*(ect F0B@s?&are meter commercial lot and for the
spo&ses N&g&id to *e directed to render an acco&nting
&nder oath, of the income derived from the s&*(ect
fo&r@door apartment from Novem*er FF, 3::. &ntil
possession of the same )as restored to him.
n an Order dated 9an&ary FB, 3::B, the DT% denied
the Motion to Destore Possession to the plainti,
averring that the c&rrent mar2et val&e of the *&ilding
sho&ld frst *e determined. Pending the said
determination, the resol&tion of the Motion for
Acco&nting )as li2e)ise held in a*eyance.
Meantime, defendants are directed to pay plainti, the
*alance of P366,666.66.
On "ecem*er 3::5, after paying the said P366,666
*alance to Pedro Pecson the spo&ses N&g&id prayed
for the clos&re and termination of the case, as )ell as
the cancellation of the notice of lis pendens on the title
of the property on the gro&nd that Pedro Pecson;s
claim for rentals )as devoid of fact&al and legal *ases.
After cond&cting a hearing, the lo)er co&rt iss&ed an
Order dated 9&ly .3, 3::A, directing the spo&ses to pay
the s&m of P3,.//,666 as reim*&rsement of the
&nreali-ed income of Pecson for the period *eginning
Novem*er FF, 3::. &p to "ecem*er 3::5. The s&m
)as *ased on the comp&tation of PFA,666Imonth
rentals of the fo&r@door apartment.
The %o&rt fnds plainti,;s motion valid and meritorio&s.
The decision of the 4&preme %o&rt in the aforesaid
case MPecson vs. Court of Appeals, F// 4%DA /65N
)hich set aside the Order of this %o&rt of Novem*er
30, 3::. has in e,ect &pheld plainti,;s right of
possession of the *&ilding for as long as he is not f&lly
paid the val&e thereof. t follo)s, as declared *y the
4&preme %o&rt in said decision that the plainti, is
entitled to the income derived therefrom, th&s>
Decords sho) that the plainti, )as dispossessed of the
premises on Novem*er FF, 3::. and that he )as f&lly
paid the val&e of his *&ilding in "ecem*er 3::5.
Therefore, he is entitled to the income thereof
*eginning on Novem*er FF, 3::., the time he )as
dispossessed, &p to the time of said f&ll payment, in
"ecem*er 3::5, or a total of /A months.
The N&g&id spo&ses fled a motion for reconsideration
*&t this )as denied for lac2 of merit.
The N&g&id co&ple then appealed the trial co&rt;s
r&ling to the %o&rt of Appeals.
n the %o&rt of Appeals, the order appealed from in %A@
#.D. %H No. B/F:0, )as modifed. The %A red&ced the
rentals from P3,.//,666 toPFA6,666 in favor of the
appellee.M3:N The said amo&nt represents accr&ed
rentals from the determination of the c&rrent mar2et
val&e on 9an&ary .3, 3::5MF6N &ntil its f&ll payment on
"ecem*er 3F, 3::5.
Petitioners call o&r attention to the fact that after
reaching an agreed price of P/66,666 for the
improvements, they only made a partial payment of
P.66,666. Th&s, they contend that their fail&re to pay
the f&ll price for the improvements )ill, at most, entitle
respondent to *e restored to possession, *&t not to
collect any rentals. Petitioners insist that this is the
proper interpretation of the dispositive portion of the
decision in #.D. No. 330A3/, )hich states in part that
KMtNhe val&e so determined shall *e forth)ith paid *y
the private respondents M4po&ses 9&an and Crlinda
N&g&idN to the petitioner MPedro PecsonN ot$"%4's"
the petitioner shall *e restored to the possession of
the apartment *&ilding &ntil payment of the re?&ired
indemnity.L
No) herein respondent, Pecson, disagrees )ith herein
petitioners; contention. <e arg&es that petitioners are
)rong in claiming that inasm&ch as his claim for
rentals )as not determined in the dispositive portion of
the decision in #.D. No. 330A3/, it co&ld not *e the
s&*(ect of e=ec&tion. <e points o&t that in moving for
an acco&nting, all he as2ed )as that the val&e of the
fr&its of the property d&ring the period he )as
dispossessed *e acco&nted for, since this %o&rt
e=plicitly recogni-ed in #.D. No. 330A3/, he )as
entitled to the property. <e points o&t that this %o&rt
r&led that KMtNhe petitioner MPecsonN not having *een
so paid, he )as entitled to retain o)nership of the
*&ilding and, necessarily, the income therefrom.
I.E
$hether or not the co&rt of appeals erred in holding
petitioners lia*le to pay rent over and a*ove the
c&rrent mar2et val&e of the improvement )hen s&ch
)as not provided for in the dispositive portion of the
s&preme co&rt;s r&ling in g.r. no. 330A3/.
R.LING
#iven the circ&mstances of the instant case )here the
*&ilder in good faith has *een clearly denied his right
of retention for almost half a decade, )e fnd that the
increased a)ard of rentals *y the DT% )as reasona*le
and e?&ita*le. The petitioners had reaped all the
*enefts from the improvement introd&ced *y the
respondent d&ring said period, )itho&t paying any
amo&nt to the latter as reim*&rsement for his
constr&ction costs and e=penses. They sho&ld acco&nt
and pay for s&ch *enefts.
$e need not *ela*or no) the appellate co&rt;s
recognition of herein respondent;s entitlement to
rentals from the date of the determination of the
c&rrent mar2et val&e &ntil its f&ll payment. Despondent
is clearly entitled to payment *y virt&e of his right of
retention over the said improvement.
-HERE&ORE, the instant petition is "CNC" for lac2
of merit. The "ecision dated May F3, F663 of the %o&rt
of Appeals in %A@#.D. %H No. B/F:0 is 4CT A4"C and
the Order dated 9&ly .3, 3::A, of the Degional Trial
%o&rt, 1ranch 363, J&e-on %ity, in %ivil %ase No. J@
/3/56 ordering the herein petitioners, 4po&ses 9&an
and Crlinda N&g&id, to acco&nt for the rental income of
the fo&r@door t)o@storey apartment *&ilding from
Novem*er 3::. &ntil "ecem*er 3::5, in the amo&nt
of P3,.//,666, comp&ted on the *asis of T)enty@eight
Tho&sand (PFA,666.66) pesos monthly, for a period of
/A months, is here*y DCN4TATC". Ontil f&lly paid, said
amo&nt of rentals sho&ld *ear the legal rate of interest
set at si= percent (BP) per ann&m comp&ted from the
date of DT% (&dgment. f any portion thereof shall
thereafter remain &npaid, despite notice of fnality of
this %o&rt;s (&dgment, said remaining &npaid amo&nt
shall *ear the rate of interest set at t)elve percent
(3FP) per ann&m comp&ted from the date of said
notice. %osts against petitioners.
;G.R. No. 1=8894. &"8%u)%7 1=, 1997>
TECNOGA 3HILI33INE MAN.&ACT.RING
COR3ORATION, petitioner, vs. CO.RT O& A33EAL
@&ORMER 3ECIAL E:ENTEENTH ,I:IIONB )(!
E,.AR,O .Y, respondents.

3ANGANIBAN, J.0
&ACT
KThat plainti, (herein petitioner) )hich is a corporation
d&ly organi-ed and e=isting &nder and *y virt&e of
Philippine la)s is the registered o)ner of a parcel of
land sit&ated in 1arrio 4an "ionisio, ParaQa?&e, Metro
Manila 2no)n as !ot /..3@A (sho&ld *e /0.3@A) of !ot
/0.3 of the %adastral 4&rvey of ParaQa?&e, Metro
Manila, covered *y Transfer %ertifcate of Title No.
/6:.3B of the Degistry of "eeds of the Province of
Di-al+ that said land )as p&rchased *y plainti, from
Pari- nd&stries, nc. in 3:56, together )ith all the
*&ildings and improvements incl&ding the )all e=isting
thereon+ that the defendant (herein private
respondent) is the registered o)ner of a parcel of land
2no)n as !ot No. /0.3@1 of !ot /0.3 of the %adastral
4&rvey of ParaQa?&e, !D% (#!DO) Dec. No. 3:B/0
covered *y Transfer %ertifcate of Title No. F5:A.A, of
the Degistry of "eeds for the Province of Di-al+ that
said land )hich ad(oins plainti,;s land )as p&rchased
*y defendant from a certain Cnrile Antonio also in
3:56.
That in 3:53, defendant p&rchased another lot also
ad(oining plainti,;s land from a certain Mig&el
Dodrig&e- and the same )as registered in defendant;s
name &nder Transfer %ertifcate of Title No. .3.:6, of
the Degistry of "eeds for the Province of Di-al+ that
portions of the *&ildings and )all *o&ght *y plainti,
together )ith the land from Pari- nd&stries are
occ&pying a portion of defendant;s ad(oining land.
Opon learning of the encroachment or occ&pation *y
its *&ildings and )all of a portion of defendant;s land,
plainti, o,ered to *&y from defendant that partic&lar
portion of defendant;s land occ&pied *y portions of its
*&ildings and )all )ith an area of 556 s?&are meters,
more or less, *&t defendant, ho)ever, ref&sed the
o,er.
n 3:5., the parties entered into a private agreement
*efore a certain %ol. Dosales in MalacaQang, )herein
plainti, agreed to demolish the )all at the *ac2
portion of its land th&s giving to defendant possession
of a portion of his land previo&sly enclosed *y
plainti,;s )all.
"efendant later fled a complaint *efore the o8ce of
M&nicipal Cngineer of ParaQa?&e, Metro Manila as )ell
as *efore the O8ce of the Provincial 'iscal of Di-al
against plainti, in connection )ith the encroachment
or occ&pation *y plainti,;s *&ildings and )alls of a
portion of its land *&t said complaint did not prosper.
"efendant d&g or ca&sed to *e d&g a canal along
plainti,;s )all, a portion of )hich collapsed in 9&ne,
3:A6, and led to the fling *y plainti, of the
s&pplemental complaint in the a*ove@entitled case and
a separate criminal complaint for malicio&s mischief
against defendant and his )ife )hich &ltimately
res&lted into the conviction in co&rt of defendant;s
)ife for the crime of malicio&s mischief.
$hile the trial of the case )as in progress, plainti,
fled in %o&rt a formal proposal for settlement of the
case *&t said proposal, ho)ever, )as ignored *y
defendant.L
After trial on the merits, the DT% of Pasay %ity, 1ranch
335 rendered a decision dated "ecem*er /, 3:A: in
favor of petitioner )ho )as the plainti, therein.
The co&rt ordered the defendant to sell to plainti, that
portion of land o)ned *y him and occ&pied *y portions
of plainti,;s *&ildings and )all at the price of
PF,666.66 per s?&are meter and to pay the former>
The s&m of P//,666.66 to compensate for the
losses in materials and properties inc&rred *y
plainti, thro&gh thievery as a res&lt of the
destr&ction of its )all.
The s&m of P5,066.66 as and *y )ay of attorney;s
fees+ and
The costs of this s&it.L
Appeal )as d&ly interposed )ith respondent %o&rt,
)hich as previo&sly stated, reversed and set aside the
decision of the Degional Trial %o&rt and rendered the
assailed "ecision and Amended "ecision. <ence, this
reco&rse &nder D&le /0 of the D&les of %o&rt.
I.E
$hether or not the respondent %o&rt of Appeals erred
in holding the petitioner a *&ilder in *ad faith *eca&se
it is Rpres&med to 2no) the metes and *o&nds of his
property.
R.LING
Despondent %o&rt, citing the cases of 9. M. T&ason S
%o., nc. vs. Hda. de !&manlanM35N and 9. M. T&ason S
%o., nc. vs. Macalindong, r&led that petitioner Kcannot
*e considered in good faithL *eca&se as a land o)ner,
it is Kpres&med to 2no) the metes and *o&nds of his
o)n property, especially if the same are reTected in a
properly iss&ed certifcate of title. One )ho
erroneo&sly *&ilds on the ad(oining lot sho&ld *e
considered a *&ilder in *ad faith, there *eing
pres&mptive 2no)ledge of the Torrens title, the area,
and the e=tent of the *o&ndaries.L

-" !'s)g%"" 4't$ %"s2o(!"(t Cou%t. The t)o
cases it relied &pon do not s&pport its main
prono&ncement that a registered o)ner of land has
pres&mptive 2no)ledge of the metes and *o&nds of its
o)n land, and is therefore in *ad faith if he mista2enly
*&ilds on an ad(oining land. Aside from the fact that
those cases had fact&al moorings radically di,erent
from those o*taining here, there is nothing in those
cases )hich )o&ld s&ggest, ho)ever remotely, that
*ad faith is imp&ta*le to a registered o)ner of land
)hen a part of his *&ilding encroaches &pon a
neigh*or;s land, simply *eca&se he is s&pposedly
pres&med to 2no) the *o&ndaries of his land as
descri*ed in his certifcate of title.
Article 0F5 of the %ivil %ode pres&mes good faith, and
since no proof e=ists to sho) that the encroachment
over a narro), needle@shaped portion of private
respondent;s land )as done in *ad faith *y the *&ilder
of the encroaching str&ct&res, the latter sho&ld *e
pres&med to have *&ilt them in good faith.
t is pres&med that possession contin&es to *e
en(oyed in the same character in )hich it )as
ac?&ired, &ntil the contrary is proved. #ood faith
consists in the *elief of the *&ilder that the land he is
*&ilding on is his, and his ignorance of any defect or
Ta) in his title.
%onse?&ently, the *&ilder, if s&ed *y the aggrieved
lando)ner for recovery of possession, co&ld have
invo2ed the provisions of Art. //A of the %ivil %ode,
)hich reads>
The owner of the land on which anything has been
built, sown or planted in good faith, shall have the
right to appropriate as his own the works, sowing
or planting, after payment of the indemnity
provided for in articles 5! and 5", or to oblige
the one who built or planted to pay the price of the
land, and the one who sowed, the proper rent.
#owever, the builder or planter cannot be obliged
to buy the land if its value is considerably more
than that of the building or trees. $n such case, he
shall pay reasonable rent, if the owner of the land
does not choose to appropriate the building or
trees after proper indemnity. The parties shall
agree upon the terms of the lease and in case of
disagreement, the court shall %& the terms
thereof.
n the frst place, there is no s&8cient sho)ing that
petitioner )as a)are of the encroachment at the time
it ac?&ired the property from Pari- nd&stries. $e
agree )ith the trial co&rt that vario&s factors in
evidence ade?&ately sho) petitioner;s lac2 of
a)areness thereof. n any case, contrary proof has not
overthro)n the pres&mption of good faith &nder Article
0F5 of the %ivil %ode, as already stated, ta2en
together )ith the disp&ta*le pres&mptions of the la)
on evidence. These pres&mptions state, &nder 4ection
. (a) of D&le 3.3 of the D&les of %o&rt, that the person
is innocent of a crime or )rong+ and &nder 4ection .
(,) of D&le 3.3, that the la) has *een o*eyed.
n the second place, &pon delivery of the property *y
Pari- nd&stries, as seller, to the petitioner, as *&yer,
the latter ac?&ired o)nership of the property.
%onse?&ently and as earlier disc&ssed, petitioner is
deemed to have stepped into the shoes of the seller in
regard to all rights of o)nership over the immova*le
sold, incl&ding the right to compel the private
respondent to e=ercise either of the t)o options
provided &nder Article //A of the %ivil %ode.
-HERE&ORE, premises considered, the petition is
here*y #DANTC" and the assailed "ecision and the
Amended "ecision are DCHCD4C" and 4CT A4"C. n
accordance )ith the case of "epra vs. "&mlao,M/FN
this case is DCMAN"C" to the Degional Trial %o&rt of
Pasay %ity, 1ranch 335, for f&rther proceedings
consistent )ith Articles //A and 0/B
;G.R. No. 79988. &"8%u)%7 1, 1999>
3LEAANT:ILLE ,E:ELO3MENT COR3ORATION,
petitioner, vs. CO.RT O& A33EAL, -ILON KEE, C.T.
TORRE ENTER3RIE, INC. )(! EL,RE, JAR,INICO,
respondents.

3ANGANIBAN, J.0
&ACT
Cdith Do*illo p&rchased from petitioner a parcel of land
designated as !ot :, Phase and located at Tac&ling
Doad, Pleasantville 4&*division, 1acolod %ity. n 3:50,
respondent Cldred 9ardinico *o&ght the rights to the lot
from Do*illo. At that time, !ot : )as vacant.
Opon completing all payments, 9ardinico sec&red from
the Degister of "eeds of 1acolod %ity on "ecem*er 3:,
3:5A Transfer %ertifcate of Title No. 36B.B5 in his
name. t )as then that he discovered that
improvements had *een introd&ced on !ot : *y
respondent $ilson Kee, )ho had ta2en possession
thereof.
t appears that on March FB, 3:5/, Kee *o&ght on
installment !ot A of the same s&*division from %.T.
Torres Cnterprises, nc. (%TTC), the e=cl&sive real
estate agent of petitioner. Onder the %ontract to 4ell
on nstallment, Kee co&ld possess the lot even *efore
the completion of all installment payments.
On 9an&ary F6, 3:50, Kee paid %TTC the relocation fee
of P06.66 and another P06.66 on 9an&ary F5, 3:50, for
the preparation of the lot plan. These amo&nts )ere
paid prior to Kee;s ta2ing act&al possession of !ot A.
After the preparation of the lot plan and a copy thereof
given to Kee, %TTC thro&gh its employee, Eenaida
Octaviano, accompanied Kee;s )ife, "ona*elle Kee, to
inspect !ot A. Onfort&nately, the parcel of land pointed
*y Octaviano )as !ot :.
Thereafter, Kee proceeded to constr&ct his residence,
a store, an a&to repair shop and other improvements
on the lot.
After discovering that !ot : )as occ&pied *y Kee,
9ardinico confronted him. The parties tried to reach an
amica*le settlement, *&t failed.
On 9an&ary .6, 3:A3, 9ardinico;s la)yer )rote Kee,
demanding that the latter remove all improvements
and vacate !ot :. $hen Kee ref&sed to vacate !ot :,
9ardinico fled )ith the M&nicipal Trial %o&rt in %ities,
1ranch ., 1acolod %ity (MT%%), a complaint for
e(ectment )ith damages against Kee.
Kee, in t&rn, fled a third@party complaint against
petitioner and %TTC.
The MT%% held that the erroneo&s delivery of !ot : to
Kee )as attri*&ta*le to %TTC. t f&rther r&led that
petitioner and %TTC co&ld not s&ccessf&lly invo2e as a
defense the fail&re of Kee to give notice of his
intention to *egin constr&ction re?&ired &nder
paragraph FF of the %ontract to 4ell on nstallment and
his having *&ilt a sari@sari store )itho&t. the prior
approval of petitioner re?&ired &nder paragraph FB of
said contract, saying that the p&rpose of these
re?&irements )as merely to reg&late the type of
improvements to *e constr&cted on the lot.
<o)ever, the MT%% fo&nd that petitioner had already
rescinded its contract )ith Kee over !ot A for the
latter;s fail&re to pay the installments d&e, and that
Kee had not contested the rescission. The rescission
)as e,ected in 3:5:, *efore the complaint )as
instit&ted. The MT%% concl&ded that Kee no longer had
any right over the lot s&*(ect of the contract *et)een
him and petitioner. %onse?&ently, Kee m&st pay
reasona*le rentals for the &se of !ot :, and,
f&rthermore, he cannot claim reim*&rsement for the
improvements he introd&ced on said lot.
On appeal, the Degional Trial %o&rt, 1ranch /A,
1acolod %ity (DT%) r&led that petitioner and %TTC )ere
not at fa&lt or )ere not negligent, there *eing no
preponderant evidence to sho) that they directly
participated in the delivery of !ot : to Kee.M0N t fo&nd
Kee a *&ilder in *ad faith. t f&rther r&led that even
ass&ming arguendo that Kee )as acting in good faith,
he )as, nonetheless, g&ilty of &nla)f&lly &s&rping the
possessory right of 9ardinico over !ot : from the time
he )as served )ith notice to vacate said lot, and th&s
)as lia*le for rental.
KThe third@party complaint against Third@Party
"efendants Pleasantville "evelopment %orporation
and %.T. Torres Cnterprises, nc. is dismissed. The order
against Third@Party "efendants to pay attorney;s fees
to plainti, and costs of litigation is reversed.L
'ollo)ing the denial of his motion for reconsideration
on Octo*er F6, 3:AB, Kee appealed directly to the
4&preme %o&rt, )hich referred the matter to the %o&rt
of Appeals.
The appellate co&rt r&led that Kee )as a *&ilder in
good faith, as he )as &na)are of the Kmi=@&pL )hen
he *egan constr&ction of the improvements on !ot A. t
f&rther r&led that the erroneo&s delivery )as d&e to
the negligence of %TTC, and that s&ch )rong delivery
)as li2e)ise imp&ta*le to its principal, petitioner
herein. The appellate co&rt also r&led that the a)ard of
rentals )as )itho&t *asis.
K'&rthermore, the case is DCMAN"C" to the co&rt of
origin for the determination of the act&al val&e of the
improvements and the property (!ot :), as )ell as for
f&rther proceedings in conformity )ith Article //A of
the Ne) %ivil %ode.L
Petitioner then fled the instant petition against Kee,
9ardinico and %TTC.
I.E
(3) $as Kee a *&ilder in good faithU
(F) $hat is the lia*ility, if any, of petitioner and its
agent, %.T.
Torres Cnterprises, nc.U
(.) s the a)ard of attorney;s fees properU
R.LING
n s&m, )e r&le that Kee is a *&ilder in good faith. The
disposition of the %o&rt of Appeals that Kee Kis entitled
to the rights granted him &nder Articles //A, 0/B and
5" of the Ne) %ivil %odeL is deleted, in vie) of the
deed of sale entered into *y Kee and 9ardinico, )hich
deed no) governs the rights of 9ardinico and Kee as to
each other. There is also no f&rther need, as r&led *y
the appellate %o&rt, to remand the case to the co&rt of
origin Kfor determination of the act&al val&e of the
improvements and the property (!ot :), as )ell as for
f&rther proceedings in conformity )ith Article //A of
the Ne) %ivil Code.
-HERE&ORE, the petition is partially #DANTC". The
"ecision of the %o&rt of Appeals is here*y MO"'C" as
follo)s>
(3) $ilson Kee is declared a *&ilder in good faith+
(F) Petitioner Pleasantville "evelopment %orporation
and respondent %.T. Tones Cnterprises, nc. are declared
solidarily lia*le for damages d&e to negligence+ ho)ever,
since the amo&nt andIor e=tent of s&ch damages )as not
proven d&ring the trial, the same cannot no) *e ?&antifed
and a)arded+
(.) Petitioner Pleasantville "evelpment %orporation
and respondent %.T. Torres Cnterprises, nc. are ordered to
pay in solidum the amo&nt of P.,666.66 to 9ardinico as
attorney;s fees, as )ell as litigation e=penses+ and
(/) The a)ard of rentals to 9ardinico is dispensed )ith.
G.R. Nos. L-99=75-79 Ju+7 5, 199=
E.LOGIO AG.TIN, HEIR O& BAL,OMERO LANGCAY,
ART.RO BALII C J.AN LANGCAY, petitioners, vs.
INTERME,IATE A33ELLATE CO.RT, MARIA MELA,,
TIMOTEO MELA,, 3ABLO BINAY.G C GERONIMA .BINA,
respondents.
E.LOGIO AG.TIN, HEIR O& BAL,OMERO LANGCAY,
ART.RO BALII C J.AN LANGCAY, petitioners, vs.
INTERME,IATE A33ELLATE CO.RT, MARIA MELA,,
TIMOTEO MELA,, 3ABLO BINAY.G C GERONIMA .BINA,
respondents.
GRIDO-A?.INO, J.:
&ACT
The %agayan Diver separates the to)ns of 4olana on
the )est and T&g&egarao on the east in the province of
%agayan. According to the &nre*&tted testimony of
Domeo Digor, #eodetic Cngineer of the 1&rea& of
!ands, in 3:3: the lands east of the river )ere covered
*y the T&g&egarao %adastre. n 3:F0, Original
%ertifcate of Title No. 0/5F )as iss&ed for land east of
the %agayan Diver o)ned *y defendant@petitioner
C&logio Ag&stin (C=h. F@Ag&stin).
As the years )ent *y, the %agayan Diver moved
grad&ally east)ard, depositing silt on the )estern
*an2. The shifting of the river and the siltation
contin&ed &ntil 3:BA.
n 3:06, all lands )est of the river )ere incl&ded in the
4olana %adastre. Among these occ&pying lands
covered *y the 4olana %adastre )ere plainti,s@private
respondents, namely, Pa*lo 1inay&g, )ho has *een in
possession of !ots. <e *egan his possession in 3:/5.
An area of eight (A) hectares )as planted to to*acco
and corn )hile 3F hectares )ere overgro)n )ith
talahib (C=h. %@3 1inay&g.) 1inay&g7s <omestead
Application No. $@5:600 over this land )as approved
in 3:0: (C=h. 1@1inay&g). 1inay&g7s possession )as
recogni-ed in the decision in %ivil %ase No. 363 (C=h.
'@1inay&g). On the other hand, as a res&lt of %ivil %ase
No. ./.@T, Macario Melad, the predecessor@in@interest
of Maria Melad and Timoteo Melad, )as iss&ed Original
%ertifcate of Title No. P@06FB for !ot ..03 of %ad. F:.
on 9&ne 3, 3:0B.
Thro&gh the years, the %agayan Diver eroded lands of
the T&g&egarao %adastre on its eastern *an2 among
)hich )as defendant@petitioner C&logio Ag&stin7s !ot
A/05 (C=h. C@Melad), depositing the all&vi&m as
accretion on the land possessed *y Pa*lo 1inay&g on
the )estern *an2.
<o)ever, in 3:BA, after a *ig Tood, the %agayan Diver
changed its co&rse, ret&rned to its 3:3: *ed, and, in
the process, c&t across the lands of Maria Melad,
Timoteo Melad, and the spo&ses Pa*lo 1inay&g and
#eronima O*ina )hose lands )ere transferred on the
eastern, or T&g&egarao, side of the river. To c&ltivate
those lots they had to cross the river.
n April, 3:B:, )hile the private respondents and their
tenants )ere planting corn on their lots located on the
eastern side of the %agayan Diver, the petitioners,
accompanied *y the mayor and some policemen of
T&g&egarao, claimed the same lands as their o)n and
drove a)ay the private respondents from the
premises.
On April F3, 3:56, private respondents Maria Melad
and Timoteo Melad fled a complaint to recover !ot No.
..03 )ith an area of 0 hectares and its B.B@hectare
accretion.
On April F/, 3:56 private respondent Pa*lo 1inay&g
fled a separate complaint (%ivil %ase No. .//@T) to
recover his lots and their accretions.
The decision made )as against the defendants. Only
defendant C&logio Ag&stin appealed.
On Novem*er F:, 3:A., the ntermediate Appellate
%o&rt rendered a decision a8rming in toto the
(&dgment of the trial co&rt, )ith costs against the
defendants@appellants.
I.E0 $hether or not private respondents have retained
the o)nership of the portion that )as transferred *y av&lsion
to the other side of the river.
R.LING
The private respondents7 o)nership of the accretion to
their lands )as not lost &pon the s&dden and a*r&pt
change of the co&rse of the %agayan Diver in 3:BA or
3:B: )hen it reverted to its old 3:3: *ed, and
separated or transferred said accretions to the other
side (or eastern *an2) of the river. Articles /0: and
/B. of the Ne) %ivil %ode apply to this sit&ation.
Art. 459. 'henever the current of a river, creek or torrent
segregates from an estate on its bank a known portion of
land and transfers it to another estate, the owner of the land
to which the segregated portion belonged retains the
ownership of it, provided that he removes the same within
two years.
Art. 463. 'henever the current of a river divides itself into
branches, leaving a piece of land or part thereof isolated, the
owner of the land retains his ownership. #e also retains it if a
portion of land is separated from the estate by the current.

n the case at *ar, the s&dden change of co&rse of the
%agayan Diver as a res&lt of a strong typhoon in 3:BA
ca&sed a portion of the lands of the private
respondents to *e Gseparated from the estate *y the
c&rrent.G T$" 2%'5)t" %"s2o(!"(ts $)5" %"t)'("!
t$" o4("%s$'2 o# t$" 2o%t'o( t$)t 4)s
t%)(s#"%%"! 87 )5u+s'o( to t$" ot$"% s'!" o# t$"
%'5"%.
$<CDC'ODC, the petition is denied for lac2 of merit.
The decision of the ntermediate Appellate %o&rt, no)
%o&rt of Appeals, is here*y a8rmed. %osts against the
petitioners.