Republic v East Silverlane

The Factual Antecedents

The respondent filed with the RTC an application for land registration, covering a parcel of land identified as
Lot 9039 of Cagayan Cadastre, situated in El Salvador, Misamis Oriental and with an area of 9,794 square meters.
The respondent purchased the portion of the subject property consisting of 4,708 square meters (Area A) from
Francisca Oco pursuant to a Deed of Absolute Sale dated November 27, 1990 and the remaining portion consisting
of 5,086 square meters (Area B) from Rosario U. Tan Lim, Nemesia Tan and Mariano U. Tan pursuant to a Deed of
Partial Partition with Deed of Absolute Sale dated April 11, 1991. It was claimed that the respondents predecessorsin-interest had been in open, notorious, continuous and exclusive possession of the subject property since June 12,
1945.
After hearing the same on the merits, the RTC issued on August 27, 2004 a Decision, granting the respondents
petition for registration of the land in question, thus:
ACCORDINGLY, finding the application meritorious, and pursuant to applicable law and jurisprudence on the matter,
particularly the provisions of P.D. 1529, judgment is hereby rendered granting the instant application. The Land
Registration Authority is hereby ordered to issue a decree in the name of the applicant EAST SILVERLANE REALTY
DEVELOPMENT
CORPORATION covering
the
parcel
of
land, Lot 9039, Cad 237, having an area of 9,794 square meters covered by the two (2) tax declarations subject of
this
petition.
Based
on
the
decree, the Register of Deeds for the Province of Misamis Oriental is hereby directed to issue an original certificate
of title in the name of the applicant covering the land subject matter of this application. [5]

[6]

On appeal by the petitioner, the CA affirmed the RTCs August 27, 2004 Decision. In its July 31, 2008 Decision,
the CA found no merit in the petitioners appeal, holding that:

It is a settled rule that an application for land registration must conform to three requisites: (1) the land is alienable
public land; (2) the applicants open, continuous, exclusive and notorious possession and occupation thereof must
be since June 12, 1945, or earlier; and (3) it is a bona fide claim of ownership.
In the case at bench, petitioner-appellee has met all the requirements. Anent the first requirement, both the
report and certification issued by the Department of Environment and Natural Resources (DENR) shows that the
subject land was within the alienable and disposable zone classified under BF Project [N]o. 8 Blk. I, L.C. Map [N]o.
585 and was released and certified as such on December 31, 1925.
Indubitably, both the DENR certification and report constitute a positive government act, an administrative
action, validly classifying the land in question. It is a settled rule that the classification or re-classification of public
lands into alienable or disposable, mineral or forest land is now a prerogative of the Executive Department of the
government. Accordingly, the certification enjoys a presumption of regularity in the absence of contradictory
evidence. As it is, the said certification remains uncontested and even oppositor-appellant Republic itself did not
present any evidence to refute the contents of the said certification. Thus, the alienable and disposable character of
the subject land certified as such as early as December 31, 1925 has been clearly established by the evidence of
the petitioner-appellee.
Anent the second and third requirements, the applicant is required to prove his open, continuous, exclusive and
notorious possession and occupation of the subject land under a bona fide claim of ownership either since time
immemorial or since June 12, 1945.
xxxx
In the case at bench, ESRDC tacked its possession and occupation over the subject land to that of its predecessorsin-interest. Copies of the tax declarations and real property historical ownership pertaining thereto were presented
in court. A perusal of the records shows that in 1948, a portion of the subject land was declared under the name of
Agapito Claudel. Subsequently, in 1957 until 1991 the same was declared under the name of Francisca Oco.
Thereafter, the same was declared under the name of ESRDC. A certification was likewise issued by the Provincial
Assessor of Misamis Oriental that previous tax declarations pertaining to the said portion under the name of Agapita
Claudel could no longer be located as the files were deemed lost or destroyed before World War II.

On the other hand, the remaining portion of the said land was previously declared in 1948 under the name of
Jacinto Tan Lay Cho. Subsequently, in 1969 until 1990, the same was declared under the name of Jacinto Tan.
Thereafter, the same was declared under the name of ESRDC. A certification was likewise issued by the Provincial
Assessor that the files of previous tax declarations under the name of Jacinto Tan Lay Cho were deemed lost or
destroyed again before World War II.
In 1991 or upon ESRDCs acquisition of the subject property, the latter took possession thereto. Albeit it has
presently leased the said land to Asia Brewery, Inc., where the latter built its brewery plant, nonetheless, ESRDC
has its branch office located at the plant compound of Asia Brewery, Inc.
Corollarily, oppositor-appellants contentions that the court a quo erred in considering the tax declarations as
evidence of ESRDCs possession of the subject land as the latters predecessors-in-interest declared the same
sporadically, is untenable.
It is a settled rule that albeit tax declarations and realty tax payment of property are not conclusive evidence of
ownership, nevertheless, they are good indicia of the possession in the concept of owner for no one in his right
mind would be paying taxes for a property that is not in his actual or at least constructive possession. They
constitute at least proof that the holder has a claim of title over the property. The voluntary declaration of a piece of
property for taxation purposes manifests not only ones sincere and honest desire to obtain title to the property and
announces his adverse claim against the State and all other interested parties, but also the intention to contribute
needed revenues to the Government. Such an act strengthens ones bona fide claim of acquisition of ownership.
Finally, it bears stressing that the pieces of evidence submitted by petitioner-appellee are incontrovertible. Not one,
not even oppositor-appellant Republic, presented any countervailing evidence to contradict the claims of the
petitioners that they are in possession of the subject property and their possession of the same is open, continuous
and exclusive in the concept of an owner for over 30 years.
Verily, from 1948 when the subject land was declared for taxation purposes until ESRDC filed an application for land
registration in 1995, ESRDC have been in possession over the subject land in the concept of an owner tacking its
possession to that its predecessors-in-interest for forty seven (47) years already. Thus, ESRDC was able to prove
sufficiently that it has been in possession of the subject property for more than 30 years, which possession is
characterized as open, continuous, exclusive, and notorious in the concept of an owner. [7] (citations omitted)
The petitioner assails the foregoing, alleging that the respondent failed to prove that its predecessors-in-interest
possessed the subject property in the manner and for the length of time required under Section 48 (b) of
Commonwealth Act No. 141, otherwise known as the Public Land Act (PLA), and Section 14 of Presidential Decree
No. 1529, otherwise known as the Property Registration Decree (P.D. No. 1529). According to the petitioner, the
respondent did not present a credible and competent witness to testify on the specific acts of ownership performed
by its predecessors-in-interest on the subject property. The respondents sole witness, Vicente Oco, can hardly be
considered a credible and competent witness as he is the respondents liaison officer and he is not related in any
way to the respondents predecessors-in-interest. That coconut trees were planted on the subject property only
shows casual or occasional cultivation and does not qualify as possession under a claim of ownership.
Issue
This Court is confronted with the sole issue of whether the respondent has proven itself entitled to the benefits of
the PLA and P.D. No. 1529 on confirmation of imperfect or incomplete titles.
Our Ruling
This Court resolves to GRANT the petition.
Preliminarily, with respect to the infirmity suffered by this petition from the standpoint of Rule 45, this Court
agrees with the respondent that the issue of whether the respondent had presented sufficient proof of the required
possession under a bona fide claim of ownership raises a question of fact, considering that it invites an evaluation
of the evidentiary record.[8] However, that a petition for review should be confined to questions of law and that this
Court is not a trier of facts and bound by the factual findings of the CA are not without exceptions. Among these
exceptions, which obtain in this case, are: (a) when the judgment of the CA is based on a misapprehension of facts
or (b) when its findings are not sustained by the evidence on record.

This Courts review of the records of this case reveals that the evidence submitted by the respondent fell
short of proving that it has acquired an imperfect title over the subject property under Section 48 (b) of the PLA.
The respondent cannot register the subject property in its name on the basis of either Section 14 (1) or Section 14
(2) of P.D. No. 1529. It was not established by the required quantum of evidence that the respondent and its
predecessors-in-interest had been in open, continuous, exclusive and notorious possession of the subject property
for the prescribed statutory period.
The PLA governs the classification and disposition of lands of the public domain. Under Section 11 thereof,
one of the modes of disposing public lands suitable for agricultural purposes is by confirmation of imperfect or
incomplete titles.[9] On the other hand, Section 48 provides the grant to the qualified possessor of an alienable and
disposable public land. Thus:
SEC. 48. The following-described citizens of the Philippines, occupying 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 province where the land is located for confirmation of their claims and the issuance of
a certificate of title therefor, under the Land Registration Act, to wit:
(a) Those who prior to the transfer of sovereignty from Spain to the United States have applied for the purchase,
composition or other form of grant of lands of the public domain under the laws and royal decrees then in force and
have instituted and prosecuted the proceedings in connection therewith, but have with or without default upon their
part, or for any other cause, not received title therefor, if such applicants or grantees and their heirs have occupied
and cultivated said lands continuously since the filing of their applications.
(b) Those who by themselves or through their predecessors in interest have been in open, continuous, exclusive,
and notorious possession and occupation of agricultural lands of the public domain, under a bona fide claim of
acquisition or ownership, for at least thirty years immediately preceding the filing of the application for confirmation
of title except when prevented by war or force majeure. These shall be conclusively presumed to have performed all
the conditions essential to a Government grant and shall be entitled to a certificate of title under the provisions of
this chapter.
(c) Members of the national cultural minorities who by themselves or through their predecessors-in-interest have
been in open, continuous, exclusive and notorious possession and occupation of lands of the public domain suitable
to agriculture, whether disposable or not, under a bona fide claim of ownership for at least 30 years shall be entitled
to the rights granted in sub-section (b) hereof.
Presidential Decree No. 1073 (P.D. No. 1073), which was issued on January 25, 1977, deleted subsection (a)
and amended subsection (b) as follows:
SECTION 4. The provisions of Section 48 (b) and Section 48 (c), Chapter VIII of the Public Land Act are hereby
amended in the sense that these provisions shall apply only to alienable and disposable lands of the public domain
which have been in open, continuous, exclusive and notorious possession and occupation by the applicant thru
himself or thru his predecessor-in-interest under a bona fide claim of ownership since June 12, 1945.

Notably, the first PLA, or Act No. 926, required a possession and occupation for a period of ten (10) years
prior to the effectivity of Act No. 2096 on July 26, 1904 or on July 26, 1894. This was adopted in the PLA until it was
amended by Republic Act No. 1942 on June 22, 1957, which provided for a period of thirty (30) years. It was only
with the enactment of P.D. No. 1073 on January 25, 1977 that it was required that possession and occupation should
commence on June 12, 1945.
P.D. No. 1529, which was enacted on June 11, 1978, codified all the laws relative to the registration of property.
Section 14 thereof partially provides:
Section 14. Who may apply. The following persons may file in the proper Court of First Instance an application for
registration of title to land, whether personally or through their duly authorized representatives:
(1) Those who by themselves or through their predecessors-in-interest have been in open, continuous, exclusive
and notorious possession and occupation of alienable and disposable lands of the public domain under a bona fide
claim of ownership since June 12, 1945, or earlier.

(2) Those who have acquired ownership of private lands by prescription under the provision of existing laws.
(3) Those who have acquired ownership of private lands or abandoned river beds by right of accession or accretion
under the existing laws.
(4) Those who have acquired ownership of land in any other manner provided for by law.

Section 14 (1) and Section 14 (2) are clearly different. Section 14 (1) covers alienable and disposable land while
Section 14 (2) covers private property. As this Court categorically stated in Heirs of Malabanan v. Republic of the
Philippines,[10] the distinction between the two provisions lies with the inapplicability of prescription to alienable and
disposable lands. Specifically:
At the same time, Section 14 (2) puts into operation the entire regime of prescription under the Civil Code, a fact
which does not hold true with respect to Section 14 (1). [11]
Property is either part of the public domain or privately owned. [12] Under Article 420 of the Civil Code, the
following properties are of public dominion:
(a)
Those intended for public use, such as roads, canals, rivers, torrents, ports and bridges constructed by
the State, banks, shores, roadsteads and others of similar character;
(b)
Those which belong to the State, without being for public use, and are intended for some public service
or for the development of the national wealth.

All other properties of the State, which is not of the character mentioned in Article 420 is patrimonial property,
[13]
hence, susceptible to acquisitive prescription.[14]
In Heirs of Malabanan, this Court ruled that possession and occupation of an alienable and disposable public land
for the periods provided under the Civil Code do not automatically convert said property into private property or
release it from the public domain. There must be an express declaration that the property is no longer intended for
public service or development of national wealth. Without such express declaration, the property, even if classified
as alienable or disposable, remains property of the State, and thus, may not be acquired by prescription.
Nonetheless, Article 422 of the Civil Code states that [p]roperty of public dominion, when no longer intended for
public use or for public service, shall form part of the patrimonial property of the State. It is this provision that
controls how public dominion property may be converted into patrimonial property susceptible to acquisition by
prescription. After all, Article 420 (2) makes clear that those property which belong to the State, without being for
public use, and are intended for some public service or for the development of the national wealth are public
dominion property. For as long as the property belongs to the State, although already classified as alienable or
disposable, it remains property of the public dominion if when it is intended for some public service or for the
development of the national wealth. (emphasis supplied)
Accordingly, there must be an express declaration by the State that the public dominion property is no longer
intended for public service or the development of the national wealth or that the property has been converted into
patrimonial. Without such express declaration, the property, even if classified as alienable or disposable, remains
property of the public dominion, pursuant to Article 420(2), and thus incapable of acquisition by prescription. It is
only when such alienable and disposable lands are expressly declared by the State to be no longer intended for
public service or for the development of the national wealth that the period of acquisitive prescription can begin to
run. Such declaration shall be in the form of a law duly enacted by Congress or a Presidential Proclamation in cases
where the President is duly authorized by law. [15]

In other words, for one to invoke the provisions of Section 14 (2) and set up acquisitive prescription against the
State, it is primordial that the status of the property as patrimonial be first established. Furthermore, the period of
possession preceding the classification of the property as patrimonial cannot be considered in determining the
completion of the prescriptive period.

To prove that its predecessors-in-interest were in possession of the subject property on or prior to June 12, 1945 or
had completed the prescriptive period of thirty (30) years, the respondent submitted the following tax declarations:
a)

Tax Declaration in the name of Agapita Claudel for the year 1948;

b)
Tax Declarations in the name of Francisca Oco for the years 1957, 1963, 1969, 1973, 1974, 1980, 1987,
1989 and 1991;
c)

Tax Declarations in the respondents name for the years 1991, 1992 and 1994;

d)

Tax Declarations in the name of Jacinto Tan Lay Cho for the years 1948 and 1952;

e)

Tax Declarations in the name of Jacinto Tan for the years 1969, 1973, 1974, 1980, 1989 and 1990; and

f)

Tax Declarations in the respondents name for the years 1991, 1992 and 1994.

Pursuant to Agapita Claudels 1948 Tax Declaration, there were nineteen (19) coconut and ten (10) banana trees
planted on Area A. The coconut trees were supposedly four years old, hence, the reasonable presumption that she
had been in possession even before June 12, 1945. [16]
The respondent also offered the following testimony of Vicente Oco:
Q Mr. Witness, If you know about what period your predecessor has started to possess this land subject matter of
this application?
A Per my personal knowledge, it was before the second world war but the Municipality of El Salvador was created
on June 15, 1948 by virtue of RA 268 and its started to officially function only on August 2, 1948[.]
Q From whom did you acquire this information?
A From the seller and the adjoining lot owners.[17]
To prove that its predecessors-in-interest exercised acts of dominion over the subject property, the respondent
claimed that per Francisca Ocos Tax Declarations, the following improvements were introduced in Area A: nineteen
(19) coconut and ten (10) banana trees in Area A in 1957 and 1963; thirty-three (33) coconut trees in 1969 and
1973; thirty-three (33) coconut trees, one (1) mango tree and three (3) seguidillas vines in 1974; thirty-three (33)
coconut trees in 1980; eighty-seven (87) coconut trees in 1987; and fifteen (15) coconut trees in 1989. Per Jacinto
Tans Tax Declarations, there were fifty-seven (57) coconut trees in Area B in 1973, 1974, 1980, 1989 and 1990. [18]
A reading of the CAs July 31, 2008 Decision shows that it affirmed the grant of the respondents application given
its supposed compliance with Section 14 (2) of P.D. No. 1529. It ruled that based on the evidence submitted, the
respondent is not qualified to register the subject property in its name under Section 14 (1) as the possession and
occupation of its predecessors-in-interest commenced after June 12, 1945. Nonetheless, as the CA ruled, the
respondent acquired title to the subject property by prescription as its predecessors-in-interest had possessed the
subject property for more than thirty (30) years. Citing Buenaventura v. Republic of the Philippines,[19] the CA held
that even if possession commenced after June 12, 1945, registration is still possible under Section 14 (2) and
possession in the concept of an owner effectively converts an alienable and disposable public land into private
property.
This Court, however, disagrees on the conclusion arrived at by the CA. On the premise that the application for
registration, which was filed in 1995, is based on Section 14 (2), it was not proven that the respondent and its
predecessors-in-interest had been in possession of the subject property in the manner prescribed by law and for the
period necessary before acquisitive prescription may apply.
While the subject land was supposedly declared alienable and disposable on December 31, 1925 per the April 18,
1997 Certification and July 1, 1997 Report of the Community Environment and Natural Resources Office (CENRO),
[20]
the Department of Agrarian Reform (DAR) converted the same from agricultural to industrial only on October 16,
1990.[21] Also, it was only in 2000 that the Municipality of El Salvador passed a Zoning Ordinance, including the
subject property in the industrial zone. [22]Therefore, it was only in 1990 that the subject property had been declared
patrimonial and it is only then that the prescriptive period began to run. The respondent cannot benefit from the

alleged possession of its predecessors-in-interest because prior to the withdrawal of the subject property from the
public domain, it may not be acquired by prescription.
On the premise that the application of the respondent is predicated on Section 14 (1), the same would likewise not
prosper. As shown by the tax declarations of the respondents predecessors-in-interest, the earliest that the
respondent can trace back the possession of its predecessors-in-interest is in 1948. That there were four-year old
coconut trees in Area A as stated in Agapita Claudels 1948 Tax Declaration cannot be considered a well-nigh
controvertible evidence that she was in possession prior to June 12, 1945 without any evidence that she planted
and cultivated them. In the case of Jacinto Tan Lay Cho, the earliest tax declaration in his name is dated 1948 and
there is no evidence that he occupied and possessed Area B on or prior to June 12, 1945. Furthermore, the
testimony of the respondents lone witness that the respondents predecessors-in-interest were already in
possession of the subject property as of June 12, 1945 lacks probative value for being hearsay.
It is explicit under Section 14 (1) that the possession and occupation required to acquire an imperfect title over an
alienable and disposable public land must be open, continuous, exclusive and notorious in character. In
Republic of the Philippines v. Alconaba,[23] this Court explained that the intent behind the use of possession in
conjunction
with
occupation
is
to
emphasize the need for actual and not just constructive or fictional possession.
The law speaks of possession and occupation. Since these words are separated by the conjunction and, the clear
intention of the law is not to make one synonymous with the other. Possession is broader than occupation because
it includes constructive possession. When, therefore, the law adds the word occupation, it seeks to delimit the all
encompassing effect of constructive possession. Taken together with the words open, continuous, exclusive and
notorious, the word occupation serves to highlight the fact that for an applicant to qualify, his possession must not
be a mere fiction. Actual possession of a land consists in the manifestation of acts of dominion over it of such a
nature as a party would naturally exercise over his own property.[24] (citations omitted)
On the other hand, Section 14 (2) is silent as to the required nature of possession and occupation, thus, requiring a
reference to the relevant provisions of the Civil Code on prescription. And under Article 1118 thereof, possession for
purposes of prescription must be in the concept of an owner, public, peaceful and uninterrupted. In Heirs of
Marcelina Arzadon-Crisologo v. Raon,[25]this Court expounded on the nature of possession required for purposes of
prescription:
It is concerned with lapse of time in the manner and under conditions laid down by law, namely, that the possession
should be in the concept of an owner, public, peaceful, uninterrupted and adverse. Possession is open when it is
patent, visible, apparent, notorious and not clandestine. It is continuous when uninterrupted, unbroken and not
intermittent or occasional; exclusive when the adverse possessor can show exclusive dominion over the land and an
appropriation of it to his own use and benefit; and notorious when it is so conspicuous that it is generally known and
talked of by the public or the people in the neighborhood. The party who asserts ownership by adverse possession
must prove the presence of the essential elements of acquisitive prescription. [26] (citations omitted)
This Court is not satisfied with the evidence presented by the respondent to prove compliance with the
possession required either under Section 14 (1) or Section 14 (2).
First, the twelve (12) Tax Declarations covering Area A and the eleven (11) Tax Declarations covering Area B for a
claimed possession of more than forty-six (46) years (1948-1994) do not qualify as competent evidence of actual
possession and occupation. As this Court ruled in Wee v. Republic of the Philippines:[27]
It bears stressing that petitioner presented only five tax declarations (for the years 1957, 1961, 1967, 1980 and
1985) for a claimed possession and occupation of more than 45 years (1945-1993). This type of intermittent and
sporadic assertion of alleged ownership does not prove open, continuous, exclusive and notorious possession and
occupation. In any event, in the absence of other competent evidence, tax declarations do not conclusively
establish either possession or declarants right to registration of title. [28] (emphasis supplied and citation omitted)
The phrase adverse, continuous, open, public, and in concept of owner, by which the respondent describes its
possession and that of its predecessors-in-interest is a conclusion of law. The burden of proof is on the respondent
to prove by clear, positive and convincing evidence that the alleged possession of its predecessors-in-interest was
of the nature and duration required by law. [29] It is therefore inconsequential if the petitioner failed to present
evidence that would controvert the allegations of the respondent. A person who seeks the registration of title to a
piece of land on the basis of possession by himself and his predecessors-in-interest must prove his claim by clear

and
convincing
evidence, i.e.,
he
must
title and should not rely on the absence or weakness of the evidence of the oppositors. [30]

prove

his

The respondents claim of ownership will not prosper on the basis of the tax declarations alone. In Cequea v.
Bolante,[31]this Court ruled that it is only when these tax declarations are coupled with proof of actual possession of
the property that they may become the basis of a claim of ownership. [32] In the absence of actual public and adverse
possession, the declaration of the land for tax purposes does not prove ownership. [33]
Second, that the nineteen (19) coconut trees supposedly found on Area A were four years old at the time Agapita
Claudel filed a Tax Declaration in 1948 will not suffice as evidence that her possession commenced prior to June 12,
1945, in the absence of evidence that she planted and cultivated them. Alternatively, assuming that Agapita
Claudel planted and maintained these trees, such can only be considered casual cultivation considering the size
of Area A. On the other hand, that Jacinto Tan Lay Cho possessed Area B in the concept of an owner on or prior to
June 12, 1945 cannot be assumed from his 1948 Tax Declaration.
Third, that plants were on the subject property without any evidence that it was the respondents predecessors-ininterest who planted them and that actual cultivation or harvesting was made does not constitute well-nigh
incontrovertible evidence of actual possession and occupation. As this Court ruled in Wee:
We are, therefore, constrained to conclude that the mere existence of an unspecified number of coffee
plants, sans any evidence as to who planted them, when they were planted, whether cultivation or harvesting was
made or what other acts of occupation and ownership were undertaken, is not sufficient to demonstrate petitioners
right to the registration of title in her favor.[34]
Fourth, Vicente Ocos testimony deserves scant consideration and will not supplement the inherent inadequacy of
the tax declarations. Apart from being self-serving, it is undoubtedly hearsay. Vicente Oco lacks
personal knowledge as to when the predecessors-in-interest of the respondent started to occupy the subject
property and admitted that his testimony was based on what he allegedly gathered from the respondents
predecessors-in-interest and the owners of adjoining lot. Moreover, Vicente Oco did not testify as to what specific
acts of dominion or ownership were performed by the respondents predecessors-in-interest and if indeed they did.
He merely made a general claim that they came into possession before World War II, which is a mere conclusion of
law and not factual proof of possession, and therefore unavailing and cannot suffice. [35] Evidence of this nature
should have been received with suspicion, if not dismissed as tenuous and unreliable.
Finally, that the respondents application was filed after only four years from the time the subject property may be
considered patrimonial by reason of the DARs October 26, 1990 Order shows lack of possession whether for
ordinary or extraordinary prescriptive period. The principle enunciated in Heirs of Malabanan cited above was
reiterated and applied in Republic of thePhilippines v. Rizalvo:[36]
On this basis, respondent would have been eligible for application for registration because his claim of ownership
and possession over the subject property even exceeds thirty (30) years. However, it is jurisprudentially clear that
the thirty (30)-year period of prescription for purposes of acquiring ownership and registration of public land under
Section 14 (2) of P.D. No. 1529 only begins from the moment the State expressly declares that the public dominion
property
is
no
longer
intended
for public service or the development of the national wealth or that the property has been converted into
patrimonial.[37]
WHEREFORE, premises considered, the instant petition is GRANTED. The July 31, 2008 Decision and February 20,
2009
Resolution
of
the
Court
of
Appeals
in
CA-G.R.
CV
No.
00143
are REVERSED and
SET ASIDE and the respondents application for registration of title over Lot 9039 of Cagayan Cadastre is
hereby DENIED for lack of merit.
SO ORDERED.

Heirs of Malabanan v Republic (en banc)

GR No. 179987 April 29, 2009 en banc
FACTS:
On 20 February 1998, Mario Malabanan filed an application for land registration before the RTC of Cavite-Tagaytay,

covering a parcel of land situated in Silang Cavite, consisting of 71,324 square meters. Malabanan claimed that he
had purchased the property from Eduardo Velazco, and that he and his predecessors-in-interest had been in open,
notorious, and continuous adverse and peaceful possession of the land for more than thirty (30) years. Velazco
testified that the property was originally belonged to a twenty-two hectare property owned by his greatgrandfather, Lino Velazco. Lino had four sons Benedicto, Gregorio, Eduardo and Estebanthe fourth being
Aristedess grandfather. Upon Linos death, his four sons inherited the property and divided it among themselves.
But by 1966, Estebans wife, Magdalena, had become the administrator of all the properties inherited by the
Velazco sons from their father, Lino. After the death of Esteban and Magdalena, their son Virgilio succeeded them in
administering the properties, including Lot 9864-A, which originally belonged to his uncle, Eduardo Velazco. It was
this
property
that
was
sold
by
Eduardo
Velazco
to
Malabanan.
Among the evidence presented by Malabanan during trial was a Certification dated 11 June 2001, issued by the
Community Environment & Natural Resources Office, Department of Environment and Natural Resources (CENRODENR), which stated that the subject property was verified to be within the Alienable or Disposable land per Land
Classification Map No. 3013 established under Project No. 20-A and approved as such under FAO 4-1656 on March
15, 1982. On 3 December 2002, the RTC approved the application for registration.
The Republic interposed an appeal to the Court of Appeals, arguing that Malabanan had failed to prove that the
property belonged to the alienable and disposable land of the public domain, and that the RTC had erred in finding
that he had been in possession of the property in the manner and for the length of time required by law for
confirmation of imperfect title. On 23 February 2007, the Court of Appeals reversed the RTC ruling and dismissed
the appliocation of Malabanan.
ISSUES:
1. In order that an alienable and disposable land of the public domain may be registered under Section 14(1) of
Presidential Decree No. 1529, otherwise known as the Property Registration Decree, should the land be classified as
alienable and disposable as of June 12, 1945 or is it sufficient that such classification occur at any time prior to the
filing of the applicant for registration provided that it is established that the applicant has been in open, continuous,
exclusive and notorious possession of the land under a bona fide claim of ownership since June 12, 1945 or earlier?
2. For purposes of Section 14(2) of the Property Registration Decree may a parcel of land classified as alienable and
disposable be deemed private land and therefore susceptible to acquisition by prescription in accordance with the
Civil Code?
3. May a parcel of land established as agricultural in character either because of its use or because its slope is
below that of forest lands be registrable under Section 14(2) of the Property Registration Decree in relation to the
provisions of the Civil Code on acquisitive prescription?
4. Are petitioners entitled to the registration of the subject land in their names under Section 14(1) or Section 14(2)
of the Property Registration Decree or both?
HELD:
The Pertition is denied.
(1) In connection with Section 14(1) of the Property Registration Decree, Section 48(b) of the Public Land Act
recognizes and confirms that those who by themselves or through their predecessors in interest have been in
open, continuous, exclusive, and notorious possession and occupation of alienable and disposable lands of the
public domain, under a bona fide claim of acquisition of ownership, since June 12, 1945 have acquired ownership
of, and registrable title to, such lands based on the length and quality of their possession.
(a) Since Section 48(b) merely requires possession since 12 June 1945 and does not require that the lands should
have been alienable and disposable during the entire period of possession, the possessor is entitled to secure
judicial confirmation of his title thereto as soon as it is declared alienable and disposable, subject to the timeframe
imposed by Section 47 of the Public Land Act.
(b) The right to register granted under Section 48(b) of the Public Land Act is further confirmed by Section 14(1) of
the Property Registration Decree.

(2) In complying with Section 14(2) of the Property Registration Decree, consider that under the Civil Code,
prescription is recognized as a mode of acquiring ownership of patrimonial property. However, public domain lands
become only patrimonial property not only with a declaration that these are alienable or disposable. There must
also be an express government manifestation that the property is already patrimonial or no longer retained for
public service or the development of national wealth, under Article 422 of the Civil Code. And only when the
property has become patrimonial can the prescriptive period for the acquisition of property of the public dominion
begin
to
run.
(a) Patrimonial property is private property of the government. The person acquires ownership of patrimonial
property by prescription under the Civil Code is entitled to secure registration thereof under Section 14(2) of the
Property
Registration
Decree.
(b) There are two kinds of prescription by which patrimonial property may be acquired, one ordinary and other
extraordinary. Under ordinary acquisitive prescription, a person acquires ownership of a patrimonial property
through possession for at least ten (10) years, in good faith and with just title. Under extraordinary acquisitive
prescription, a persons uninterrupted adverse possession of patrimonial property for at least thirty (30) years,
regardless of good faith or just title, ripens into ownership.
It is clear that the evidence of petitioners is insufficient to establish that Malabanan has acquired ownership over
the subject property under Section 48(b) of the Public Land Act. There is no substantive evidence to establish that
Malabanan or petitioners as his predecessors-in-interest have been in possession of the property since 12 June 1945
or earlier. The earliest that petitioners can date back their possession, according to their own evidencethe Tax
Declarations they presented in particularis to the year 1948. Thus, they cannot avail themselves of registration
under Section 14(1) of the Property Registration Decree.
Neither can petitioners properly invoke Section 14(2) as basis for registration. While the subject property was
declared as alienable or disposable in 1982, there is no competent evidence that is no longer intended for public
use service or for the development of the national evidence, conformably with Article 422 of the Civil Code. The
classification of the subject property as alienable and disposable land of the public domain does not change its
status as property of the public dominion under Article 420(2) of the Civil Code. Thus, it is insusceptible to
acquisition by prescription.
MIAA v CA and Paraaque
Facts:
Manila International Airport Authority (MIAA) is the operator of the Ninoy International Airport located at Paranaque
City. The Officers of Paranaque City sent notices to MIAA due to real estate tax delinquency. MIAA then settled some
of the amount. When MIAA failed to settle the entire amount, the officers of Paranaque city threatened to levy and
subject to auction the land and buildings of MIAA, which they did. MIAA sought for a Temporary Restraining Order
from the CA but failed to do so within the 60 days reglementary period, so the petition was dismissed. MIAA then
sought for the TRO with the Supreme Court a day before the public auction, MIAA was granted with the TRO but
unfortunately the TRO was received by the Paranaque City officers 3 hours after the public auction. MIAA claims
that although the charter provides that the title of the land and building are with MIAA still the ownership is with the
Republic of the Philippines. MIAA also contends that it is an instrumentality of the government and as such
exempted from real estate tax. That the land and buildings of MIAA are of public dominion therefore cannot be
subjected to levy and auction sale. On the other hand, the officers of Paranaque City claim that MIAA is a
government owned and controlled corporation therefore not exempted to real estate tax.
Issues:
Whether or not MIAA is an instrumentality of the government and not a government owned and controlled
corporation and as such exempted from tax.
Whether or not the land and buildings of MIAA are part of the public dominion and thus cannot be the subject of
levy and auction sale.
Ruling: Under the Localgovernment code, government owned and controlled corporations are not exempted from
real estate tax. MIAA is not a government owned and controlled corporation, for to become one MIAA should either
be a stock or non stock corporation. MIAA is not a stock corporation for its capital is not divided into shares. It is not
a non stock corporation since it has no members. MIAA is an instrumentality of the government vested
with corporate powers and government functions. Under the civil code, property may either be under public
dominion or private ownership. Those under public dominion are owned by the State and are utilized for public use,

public service and for the development of national wealth. The ports included in the public dominion pertain either
to seaports or airports. When properties under public dominion cease to be for public use and service, they form
part of the patrimonial property of the State. The court held that the land and buildings of MIAA are part of the
public dominion. Since the airport is devoted for public use, for the domestic and international travel and
transportation. Even if MIAA charge fees, this is for support of its operation and for regulation and does not change
the character of the land and buildings of MIAA as part of the public dominion. As part of the public dominion the
land and buildings of MIAA are outside the commerce of man. To subject them to levy and public auction is contrary
to public policy. Unless the President issues a proclamation withdrawing the airport land and buildings from public
use, these properties remain to be of public dominion and are inalienable. As long as the land and buildings are for
public use the ownership is with the Republic of the Philippines.
Chavez v NHA
Ponente: VELASCO, JR., J.
FACTS:
On August 5, 2004, former Solicitor General Francisco Chavez, filed an instant petition raising constitutional issues
on the JVA entered by National Housing Authority and R-II Builders, Inc.
On March 1, 1988, then-President Cory Aquino issued Memorandum order No. (MO) 161 approving and directing
implementation of the Comprehensive and Integrated Metropolitan Manila Waste Management Plan. During this
time, Smokey Mountain, a wasteland in Tondo, Manila, are being made residence of many Filipinos living in a
subhuman state.
As presented in MO 161, NHA prepared feasibility studies to turn the dumpsite into low-cost housing project, thus,
Smokey Mountain Development and Reclamation Project (SMDRP), came into place. RA 6957 (Build-OperateTransfer Law) was passed on July 1990 declaring the importance of private sectors as contractors in government
projects. Thereafter, Aquino proclaimed MO 415 applying RA 6957 to SMDRP, among others. The same MO also
established EXECOM and TECHCOM in the execution and evaluation of the plan, respectively, to be assisted by the
Public Estates Authority (PEA).
Notices of public bidding to become NHAs venture partner for SMDRP were published in newspapers in 1992, from
which R-II Builders, Inc. (RBI) won the bidding process. Then-President Ramos authorized NHA to enter into a Joint
Venture Agreement with RBI.
Under the JVA, the project involves the clearing of Smokey Mountain for eventual development into a low cost
housing complex and industrial/commercial site. RBI is expected to fully finance the development of Smokey
Mountain and reclaim 40 hectares of the land at the Manila Bay Area. The latter together with the commercial area
to be built on Smokey Mountain will be owned by RBI as enabling components. If the project is revoked or
terminated by the Government through no fault of RBI or by mutual agreement, the Government shall compensate
RBI for its actual expenses incurred in the Project plus a reasonable rate of return not exceeding that stated in the
feasibility study and in the contract as of the date of such revocation, cancellation, or termination on a schedule to
be agreed upon by both parties.
To summarize, the SMDRP shall consist of Phase I and Phase II. Phase I of the project involves clearing, levelling-off
the dumpsite, and construction of temporary housing units for the current residents on the cleared and levelled
site. Phase II involves the construction of a fenced incineration area for the on-site disposal of the garbage at the
dumpsite.
Due to the recommendations done by the DENR after evaluations done, the JVA was amended and restated (now
ARJVA) to accommodate the design changes and additional work to be done to successfully implement the project.
The original 3,500 units of temporary housing were decreased to 2,992. The reclaimed land as enabling component
was increased from 40 hectares to 79 hectares, which was supported by the issuance of Proclamation No. 465 by
President Ramos. The revision also provided for the 119-hectare land as an enabling component for Phase II of the
project.
Subsequently, the Clean Air Act was passed by the legislature which made the establishment of an incinerator
illegal, making the off-site dumpsite at Smokey Mountain necessary. On August 1, 1998, the project was
suspended, to be later reconstituted by President Estrada in MO No. 33.
On August 27, 2003, the NHA and RBI executed a Memorandum of Agreement whereby both parties agreed to
terminate the JVA and subsequent agreements. During this time, NHA reported that 34 temporary housing
structures and 21 permanent housing structures had been turned over by RBI.
ISSUES:
1. Whether respondents NHA and RBI have been granted the power and authority to reclaim lands of the
public domain as this power is vested exclusively in PEA as claimed by petitioner
2. Whether respondents NHA and RBI were given the power and authority by DENR to reclaim foreshore and
submerged lands

10

3.
4.
5.
6.
7.
8.
9.
HELD:
1.

2.

3.
4.

5.
6.

7.

8.
9.

Whether respondent RBI can acquire reclaimed foreshore and submerged lands considered as alienable
and outside the commerce of man
Whether respondent RBI can acquire reclaimed lands when there was no declaration that said lands are no
longer needed for public use
Whether there is a law authorizing sale of reclaimed lands
Whether the transfer of reclaimed lands to RBI was done by public bidding
Whether RBI, being a private corporation, is barred by the Constitution to acquire lands of public domain
Whether respondents can be compelled to disclose all information related to the SMDRP
Whether the operative fact doctrine applies to the instant position
Executive Order 525 reads that the PEA shall be primarily responsible for integrating, directing, and
coordinating all reclamation projects for and on behalf of the National Government. This does not mean
that it shall be responsible for all. The requisites for a valid and legal reclamation project are approval by
the President (which were provided for by MOs), favourable recommendation of PEA (which were seen as a
part of its recommendations to the EXECOM), and undertaken either by PEA or entity under contract of PEA
or by the National Government Agency (NHA is a government agency whose authority to reclaim lands
under consultation with PEA is derived under PD 727 and RA 7279).
Notwithstanding the need for DENR permission, the DENR is deemed to have granted the authority to
reclaim in the Smokey Mountain Project for the DENR is one of the members of the EXECOM which provides
reviews for the project. ECCs and Special Patent Orders were given by the DENR which are exercises of its
power of supervision over the project. Furthermore, it was the President via the abovementioned MOs that
originally authorized the reclamation. It must be noted that the reclamation of lands of public domain is
reposed first in the Philippine President.
The reclaimed lands were classified alienable and disposable via MO 415 issued by President Aquino and
Proclamation Nos. 39 and 465 by President Ramos.
Despite not having an explicit declaration, the lands have been deemed to be no longer needed for public
use as stated in Proclamation No. 39 that these are to be disposed to qualified beneficiaries.
Furthermore, these lands have already been necessarily reclassified as alienable and disposable lands
under the BOT law.
Letter I of Sec. 6 of PD 757 clearly states that the NHA can acquire property rights and interests and
encumber or otherwise dispose of them as it may deem appropriate.
There is no doubt that respondent NHA conducted a public bidding of the right to become its joint venture
partner in the Smokey Mountain Project. It was noted that notices were published in national newspapers.
The bidding proper was done by the Bids and Awards Committee on May 18, 1992.
RA 6957 as amended by RA 7718 explicitly states that a contractor can be paid a portion as percentage of
the reclaimed land subject to the constitutional requirement that only Filipino citizens or corporation with
at least 60% Filipino equity can acquire the same. In addition, when the lands were transferred to the
NHA, these were considered Patrimonial lands of the state, by which it has the power to sell the same to
any qualified person.
This relief must be granted. It is the right of the Filipino people to information on matters of public
concerned as stated in Article II, Sec. 28, and Article III, Sec. 7 of the 1987 Constitution.
When the petitioner filed the case, the JVA had already been terminated by virtue of MOA between RBI and
NHA. The properties and rights in question after the passage of around 10 years from the start of the
projects implementation cannot be disturbed or questioned. The petitioner, being the Solicitor General at
the time SMDRP was formulated, had ample opportunity to question the said project, but did not do so.
The moment to challenge has passed.

Chavez v Public Estates Authority

Facts:
The Public Estates Authority (PEA) is the central implementing agency tasked to undertake reclamation projects
nationwide. It took over the leasing and selling functions of the DENR (Department of Environmental and Natural
Resources) insofar as reclaimed or about to be reclaimed foreshore lands are concerned.
PEA sought the transfer to the Amari Coastal Bay and Development Corporation, a private corporation, of the
ownership of 77.34 hectares of the Freedom Islands. PEA also sought to have 290.156 hectares of submerged areas
of Manila Bay to Amari.
Issue: Whether or not the transfer is valid.

11

Held: No. To allow vast areas of reclaimed lands of the public domain to be transferred to Amari as private lands will
sanction a gross violation of the constitutional ban on private corporations from acquiring any kind of alienable land
of the public domain.
The Supreme Court affirmed that the 157.84 hectares of reclaimed lands comprising the Freedom Islands, now
covered by certificates of title in the name of PEA, are alienable lands of the public domain. The 592.15 hectares of
submerged areas of Manila Bay remain inalienable natural resources of the public domain. The transfer (as
embodied in a joint venture agreement) to AMARI, a private corporation, ownership of 77.34 hectares of the
Freedom Islands, is void for being contrary to Section 3, Article XII of the 1987 Constitution which prohibits private
corporations from acquiring any kind of alienable land of the public domain. Furthermore, since the Amended JVA
also seeks to transfer to Amari ownership of 290.156 hectares of still submerged areas of Manila Bay, such transfer
is void for being contrary to Section 2, Article XII of the 1987 Constitution which prohibits the alienation of natural
resources other than agricultural lands of the public domain.
Laurel v Garcia
Facts:
Petitioners seek to stop the Philippine Government to sell the Roppongi Property, which is located in Japan. It is one
of the properties given by the Japanese Government as reparations for damage done by the latter to the former
during the war.
Petitioner argues that under Philippine Law, the subject property is property of public dominion. As such, it is
outside the commerce of men. Therefore, it cannot be alienated.
Respondents aver that Japanese Law, and not Philippine Law, shall apply to the case because the property is
located in Japan. They posit that the principle of lex situs applies.
Issues and Held:
1. WON the subject property cannot be alienated. The answer is in the affirmative.
Under Philippine Law, there can be no doubt that it is of public dominion unless it is convincingly shown that the
property has become patrimonial. This, the respondents have failed to do. As property of public dominion, the
Roppongi lot is outside the commerce of man. It cannot be alienated.
2. WON Philippine Law applies to the case at bar. The answer is in the affirmative.
We see no reason why a conflict of law rule should apply when no conflict of law situation exists. A conflict of law
situation arises only when: (1) There is a dispute over the title or ownership of an immovable, such that the
capacity to take and transfer immovables, the formalities of conveyance, the essential validity and effect of the
transfer, or the interpretation and effect of a conveyance, are to be determined; and (2) A foreign law on land
ownership and its conveyance is asserted to conflict with a domestic law on the same matters. Hence, the need to
determine which law should apply.
In the instant case, none of the above elements exists.
The issues are not concerned with validity of ownership or title. There is no question that the property belongs to
the Philippines. The issue is the authority of the respondent officials to validly dispose of property belonging to the
State. And the validity of the procedures adopted to effect its sale. This is governed by Philippine Law. The rule of
lex situs does not apply.
The assertion that the opinion of the Secretary of Justice sheds light on the relevance of the lex situs rule is
misplaced. The opinion does not tackle the alienability of the real properties procured through reparations nor the
existence in what body of the authority to sell them. In discussing who are capable of acquiring the lots, the
Secretary merely explains that it is the foreign law which should determine who can acquire the properties so that
the constitutional limitation on acquisition of lands of the public domain to Filipino citizens and entities wholly
owned by Filipinos is inapplicable.
Cebu Oxygen v Bercilles
FACTS: The City Council of Cebu, in 1968, considered as an abandoned road, the terminal portion of one of its
streets. Later it authorized the sale through public bidding of the property. The Cebu Oxygen and Acetylene Co. was
able to purchase the same. It then petitioned the RTC of Cebu for the registration of the land. The petition was

12

opposed by the Provincial Fiscal (Prosecutor) who argued that the lot is still part of the public domain, and cannot
therefore be registered.
ISSUE: May the lot be registered in the name of the buyer?
HELD: Yes, the land can be registered in the name of the buyer, because the street in question has already been
withdrawn from public use, and accordingly has become patrimonial property. The sale of the lot was therefore
valid.
Zamboanga del Norte v City of Zamboanga
FACTS: After Zamboanga Province was divided into two (Zamboanga Del Norte and Zamboanga Del Sur), Republic
Act 3039 was passed providing that-- "All buildings, properties, and assets belonging to the former province of
Zamboanga and located within the City of Zamboanga are hereby transferred free of charge in favor of the City of
Zamboanga."
Suit was brought alleging that this grant without just compensation was unconstitutional because it deprived the
province of property without due process. Included in the properties were the capital site and capitol building,
certain school sites, hospital and leprosarium sites, and high school playgrounds.
ISSUES:
1.
2.

Are the properties mentioned, properties for public use or patrimonial property?
Should the city pay for said properties?

HELD:
1.

2.

If we follow the Civil Code classification, only the high school playgrounds are for public use since it is the
only one that is available to the general public, and all the rest are patrimonial property since they are not
devoted to public use but to public service. But if we follow the law on Municipal Corporations, as long as
the purpose is for a public service, the property should be considered for PUBLIC USE.
If the Civil Code classification is used, since almost all the properties involved are patrimonial, the law
would be unconstitutional since the province would be deprived of its own property without just
compensation. If the law on Municipal Corporations would be followed, the properties would be of public
dominion, and therefore NO COMPENSATION would be required. It is the law on Municipal Corporations that
should be followed. Firstly, while the Civil Code may classify them as patrimonial, they should not be
regarded as ordinary private property. They should fall under the control of the State, otherwise certain
governmental activities would be impaired. Secondly, Art. 424, 2nd paragraph itself says "without
prejudice to the provisions of special laws."

Government v Cabangis
FACTS: In 1986, A owned a parcel of land, but because of the action of the waves of
Manila Bay, part of said land was gradually submerged in the sea. It remained submerged until 1912 when the
government decided to make the necessary dredging to reclaim the land from the sea. As soon as the land had
been recovered A took possession of it.
ISSUE: To which does the ownership of the reclaimed land belong to?
HELD: The government owns the reclaimed land in the sense that it has become property of public dominion,
because in letting it remained submerged, A may be said to have abandoned the same. Having become part of the
sea or the seashore, it became property for public use. When the government took steps to make it land again, its
status as public dominion remained unchanged; therefore, A is not entitled to the land.
Vda de Tantoco v Municipal Council of Iloilo
It appears from the record that the widow of Tan Toco had sued the municipal council of Iloilo for the amount of
P42,966.40, being the purchase price of two strips of land, one on Calle J. M. Basa consisting of 592 square meters,
and the other on Calle Aldiguer consisting of 59 square meters, which the municipality of Iloilo had appropriated for
widening said street. The Court of First Instance of Iloilo sentenced the said municipality to pay the plaintiff the
amount so claimed, plus the interest, and the said judgment was on appeal affirmed by this court. 1

13

On account of lack of funds the municipality of Iloilo was unable to pay the said judgment, wherefore plaintiff had a
writ of execution issue against the property of the said municipality, by virtue of which the sheriff attached two auto
trucks used for street sprinkling, one police patrol automobile, the police stations on Mabini street, and in Molo and
Mandurriao and the concrete structures, with the corresponding lots, used as markets by Iloilo, Molo, and
Mandurriao.
After notice of the sale of said property had been made, and a few days before the sale, the provincial fiscal of Iloilo
filed a motion which the Court of First Instance praying that the attachment on the said property be dissolved, that
the said attachment be declared null and void as being illegal and violative of the rights of the defendant
municipality.
Plaintiffs counsel objected o the fiscal's motion but the court, by order of August 12, 1925, declared the attachment
levied upon the aforementioned property of the defendant municipality null and void, thereby dissolving the said
attachment.
From this order the plaintiff has appealed by bill of exceptions. The fundamental question raised by appellant in her
four assignments of error is whether or not the property levied upon is exempt from execution.
The municipal law, section 2165 of the Administrative Code, provides that:
Municipalities are political bodies corporate, and as such are endowed with the faculties of municipal corporations,
to be exercised by and through their respective municipal government in conformity with law.
It shall be competent for them, in their proper corporate name, to sue and be sued, to contract and be contracted
with, to acquire and hold real and personal property for municipal purposes, and generally to exercise the powers
hereinafter specified or otherwise conferred upon them by law.
For the purposes of the matter here in question, the Administrative Code does not specify the kind of property that
a municipality may acquire. However, article 343 of the Civil Code divides the property of provinces and towns
(municipalities) into property for public use and patrimonial property. According to article 344 of the same Code,
provincial roads and foot-path, squares, streets, fountains and public waters, drives and public improvements of
general benefit built at the expense of the said towns or provinces, are property for public use.
All other property possessed by the said towns and provinces is patrimonial and shall be subject to the provisions of
the Civil Code except as provided by special laws.
Commenting upon article 344, Mr. Manresa says that "In accordance with administrative legislation" (Spanish) we
must distinguish, as to the patrimonial property of the towns, "between that a common benefit and that which is
private property of the town. The first differs from property for public use in that generally its enjoyment is less, as
it is limited to neighbors or to a group or class thereof; and, furthermore, such use, more or less general, is not
intrinsic with this kind of property, for by its very nature it may be enjoyed as though it were private property. The
third group, that is, private property, is used in the name of the town or province by the entities representing it and,
like and private property, giving a source of revenue."
Such distinction, however, is of little practical importance in this jurisdiction in view of the different principles
underlying the functions of a municipality under the American rule. Notwithstanding this, we believe that the
principle governing property of the public domain of the State is applicable to property for public use of the
municipalities as said municipal is similar in character. The principle is that the property for public use of the State
is not within the commerce of man and, consequently, is inalienable and not subject to prescription. Likewise,
property for public of the municipality is not within the commerce of man so long as it is used by the public and,
consequently, said property is also inalienable.
The American Law is more explicit about this matter as expounded by Mcquilin in Municipal Corporations, volume 3,
paragraph 1160, where he says that:
States statutes often provide the court houses, jails and other buildings owned by municipalities and the lots on
which they stand shall be exempt from attachment and execution. But independent of express statutory exemption,
as a general proposition, property, real and personal, held by municipal corporations, in trust for the benefit of their
inhabitants, and used for public purposes, is exempt.
For example, public buildings, school houses, streets, squares, parks, wharves, engines and engine houses, and the
like, are not subject to execution. So city waterworks, and a stock of liquors carried in a town dispensary, are
exempt. The reason for the exemption is obvious. Municipal corporations are created for public purposes and for the
good of the citizens in their aggregate or public capacity. That they may properly discharge such public functions
corporate property and revenues are essential, and to deny them these means the very purpose of their creation
would be materially impeded, and in some instances practically destroy it. Respecting this subject the Supreme
Court of Louisiana remarked: "On the first view of this question there is something very repugnant to the moral
sense in the idea that a municipal corporation should contract debts, and that, having no resources but the taxes
which are due to it, these should not be subjected by legal process to the satisfaction of its creditors. This
consideration, deduced from the principles of moral equity has only given way to the more enlarged contemplation
of the great and paramount interests of public order and the principles of government."
It is generally held that property owned by a municipality, where not used for a public purpose but for quasi private
purposes, is subject to execution on a judgment against the municipality, and may be sold. This rule applies to

14

shares of stock owned by a municipal corporation, and the like. But the mere fact that corporate property held for
public uses is being temporarily used for private purposes does not make it subject execution.
If municipal property exempt from execution is destroyed, the insurance money stands in lieu thereof and is also
exempt.
The members or inhabitants of a municipal corporation proper are not personally liable for the debts of the
municipality, except that in the New England States the individual liability of the inhabitant is generally maintained.
In Corpus Juris, vol 23, page 355, the following is found:
Where property of a municipal or other public corporation is sough to be subjected to execution to satisfy
judgments recovered against such corporation, the question as to whether such property is leviable or not is to be
determined by the usage and purposes for which it is held. The rule is that property held for public uses, such as
public buildings, streets, squares parks, promenades, wharves, landing places fire engines, hose and hose
carriages, engine houses, public markets, hospitals, cemeteries, and generally everything held for governmental
purposes, is not subject to levy and sale under execution against such corporation. The rule also applies to funds in
the hands of a public officer. Likewise it has been held that taxes due to a municipal corporation or country cannot
be seized under execution by a creditor of such corporation. But where a municipal corporation or country owns in
its proprietary, as distinguished from its public or governmental capacity, property not useful or used for a public
purpose but for quasi private purposes, the general rule is that such property may be seized and sold under
execution against the corporation, precisely as similar property of individuals is seized and sold. But property held
for public purposes is not subject to execution merely because it is temporarily used for private purposes, although
if the public use is wholly abandoned it becomes subject to execution. Whether or not property held as public
property is necessary for the public use is a political, rather than a judicial question.
In the case of City of New Orleans vs. Louisiana Construction Co., Ltd. (140 U. S., 654; 35 Law. ed., 556), it was held
that a wharf for unloading sugar and molasses, open to the public, was property for the public use of the City of
New Orleans and was not subject to attachment for the payment of the debts of the said city.
In that case it was proven that the said wharf was a parcel of land adjacent to the Mississippi River where all
shipments of sugar and molasses taken to New Orleans were unloaded.
That city leased the said wharf to the Louisiana Construction Company, Ltd., in order that it might erect warehouses
so that the merchandise upon discharge might not be spoiled by the elements. The said company was given the
privilege of charging certain fees for storing merchandise in the said warehouses and the public in general had the
right to unload sugar and molasses there by paying the required fees, 10 per cent of which was turned over to the
city treasury.
The United States Supreme Court on an appeal held that the wharf was public property, that it never ceased to be
such in order to become private property of the city; wherefore the company could not levy execution upon the
wharf in order to collect the amount of the judgment rendered in favor thereof.
In the case of Klein vs. City of New Orleans (98 U. S., 149; 25 Law. ed., 430), the Supreme Court of the United States
that a public wharf on the banks of the Mississippi River was public property and not subject to execution for the
payment of a debt of the City of New Orleans where said wharf was located.
In this case a parcel of land adjacent to the Mississippi River, which formerly was the shore of the river and which
later enlarged itself by accession, was converted into a wharf by the city for public use, who charged a certain fee
for its use.
It was held that the land was public property as necessary as a public street and was not subject to execution on
account of the debts of the city. It was further held that the fees collected where also exempt from execution
because they were a part of the income of the city.
In the case of Tufexis vs. Olaguera and Municipal Council of Guinobatan (32 Phil., 654), the question raised was
whether for the payment of a debt to a third person by the concessionaire of a public market, the said public market
could be attached and sold at public auction. The Supreme Court held that:
Even though a creditor is unquestionably entitled to recover out of his debtor's property, yet when among such
property there is included the special right granted by the Government of usufruct in a building intended for a
public service, and when this privilege is closely related to a service of a public character, such right of the creditor
to the collection of a debt owed him by the debtor who enjoys the said special privilege of usufruct in a public
market is not absolute and may be exercised only through the action of court of justice with respect to the profits or
revenue obtained under the special right of usufruct enjoyed by debtor.
The special concession of the right of usufruct in a public market cannot be attached like any ordinary right,
because that would be to permit a person who has contracted with the state or with the administrative officials
thereof to conduct and manage a service of a public character, to be substituted, without the knowledge and
consent of the administrative authorities, by one who took no part in the contract, thus giving rise to the possibility
of the regular course of a public service being disturbed by the more or less legal action of a grantee, to the
prejudice of the state and the public interests.
The privilege or franchise granted to a private person to enjoy the usufruct of a public market cannot lawfully be
attached and sold, and a creditor of such person can recover his debt only out of the income or revenue obtained

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by the debtor from the enjoyment or usufruct of the said privilege, in the same manner that the rights of such
creditors of a railroad company can be exercised and their credit collected only out of the gross receipts remaining
after deduction has been made therefrom of the operating expenses of the road. (Law of November 12, 1896,
extended to the overseas provinces by the royal order of August 3, 1886.)
For the reasons contained in the authorities above quoted we believe that this court would have reached the same
conclusion if the debtor had been municipality of Guinobatan and the public market had been levied upon by virtue
of the execution.
It is evident that the movable and immovable property of a municipality, necessary for governmental purpose, may
not be attached and sold for the payment of a judgment against the municipality. The supreme reason for this rule
is the character of the public use to which such kind of property is devoted. The necessity for government service
justifies that the property of public of the municipality be exempt from execution just as it is necessary to exempt
certain property of private individuals in accordance with section 452 of the Code of Civil Procedure.
Even the municipal income, according to the above quoted authorities, is exempt from levy and execution. In
volume 1, page 467, Municipal Corporations by Dillon we find that:
Municipal corporations are instituted by the supreme authority of a state for the public good. They exercise, by
delegation from the legislature, a portion of the sovereign power. The main object of their creation is to act as
administrative agencies for the state, and to provide for the police and local government of certain designated civil
divisions of its territory. To this end they are invested with certain governmental powers and charged with civil,
political, and municipal duties. To enable them beneficially to exercise these powers and discharge these duties,
they are clothed with the authority to raise revenues, chiefly by taxation, and subordinately by other modes as by
licenses, fines, and penalties. The revenue of the public corporation is the essential means by which it is enabled to
perform its appointed work. Deprived of its regular and adequate supply of revenue, such a corporation is
practically destroyed and the ends of its erection thwarted. Based upon considerations of this character, it is the
settled doctrine of the law that only the public property but also the taxes and public revenues of such corporations
cannot be seized under execution against them, either in the treasury or when in transit to it. Judgments rendered
for taxes, and the proceeds of such judgments in the hands of officers of the law, are not subject to execution
unless so declared by statute. The doctrine of the inviolability of the public revenues by the creditor is maintained,
although the corporation is in debt, and has no means of payment but the taxes which it is authorized to collect.
Another error assigned by counsel for appellant is the holding of the court a quo that the proper remedy for
collecting the judgment in favor of the plaintiff was by way or mandamus.
While this question is not necessarily included in the one which is the subject of this appeal, yet we believe that the
holding of the court, assigned as error by appellant's counsel, is true when, after a judgment is rendered against a
municipality, it has no property subject to execution. This doctrine is maintained by Dillon (Municipal Corporations,
vol. 4, par. 1507, 5th ed.) based upon the decisions of several States of the Union upholding the same principle and
which are cited on page 2679 of the aforesaid work. In this sense this assignment of error, we believe, is
groundless.
By virtue of all the foregoing, the judgment appealed from should be and is hereby affirmed with costs against the
appellant. So ordered.
CHARACTERISTICS OF PROPERTIES OF PUBLIC DOMINION.
Vda. De Tantoco v. Muncipal Council of Iloilo
Property of public domain applies to municipal property for public use; both not within the commerce of man
The principle governing property of the public domain of the State is applicable to property for public use of the
municipalities as said municipal property is similar in character. The principle is that the property for public use of
the State is not within the commerce of man and, consequently, is unalienable and not subject to prescription.
Likewise, property for public use of the municipality is not within the commerce of man so long as it is used by the
public and, consequently, said property is also inalienable.
Salas v Jarencio
FACTS: The City of Manila had a Torrens Title over a 7,490-square-meter lot. The municipal Board of Manila
requested the President of the Philippines to have the lot declared as patrimonial property of the City so that it
could be sold by the City to the actual occupants of the lot. In 1964, Congress enacted Republic Act 4118 whereby
the lot was made disposable or alienable land of the State (not of the City), and its disposal was given to a national
government entity, the Land Tenure Administration.
ISSUE: Whether or not the act of the National Government in giving the disposal of the lot in question to the Land
Tenure Administration can be lawfully done.

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HELD: Yes. There being no proof that the lot had been acquired by the City with its own funds, the presumption is
that it was given to it by the State IN TRUST for the benefit of the inhabitants. Residual control remained in the
State, and therefore the STATE can lawfully dispose of the lot. Thus, Republic Act 4118 is valid and constitutional
and this is so even if the City of Manila will receive NO COMPENSATION from the State.

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