1. SALAS vs.

JARENCIO
Facts: City of Manila owns a parcel of land. On various dates in 1927, City of Manila sold portions of the parcel of land. When
the last sale was effected on August 1924, a Transfer Certificate of Title was issued in the name of City of Manila.
Subsequently, Municipal Board of Manila adopted a resolution requesting the President to consider the feasibility of
declaring the said land as patrimonial property of Manila for the purpose of selling these lots to the actual occupants thereof.
The resolution was then transmitted to the Congress. The bill was then passed by Congress and approved by President,
converting the land from communal property to disposable and alienable land of State. To implement the law, Land Authority
requested City of Manila to deliver the TCT in order to obtain title thereto in the name of Land Authority. The request was
granted with the knowledge and consent of City mayor, cancelling the previous TCTs and issuing a new TCT in the name of
Land Authority.

Issue: Whether the aforementioned land is a private or patrimonial property of the City of Manila.

Held: The land is public property. As a general rule, regardless of the source or classification of the land in the possession of
municipality, excepting those which it acquired in its own funds in its private or corporate capacity, such property is held for
the State for the benefit of its inhabitants, whether it be for governmental or proprietary purposes. The legal situation is the
same if the State itself holds the property and puts it to a different use. When it comes to property of municipality which it
did not acquire in its private or corporate capacity with its own funds, the legislature can transfer its administration and
disposition to an agency of the National Government to be disposed of according to its discretion. Here it did so in obedience
to the constitutional mandate of promoting social justice to insure the well-being and economic security of the people.

2. CEBU OXYGEN AND ACETYLENE CO. V. BERCILLES 66 SCRA 431

FACTS: The land sought to be registered in this case was formerly a part of a street. Through a resolution, it was
declared to be an abandoned road and not part of the City development plan. Thereafter, it was sold through a public
bidding and petitioner was the highest bidder. He then sought to register said land but his application was dismissed.

ISSUE: Whether or Not the Land Patrimonial Property

HELD: The portion of the city street subject to petitioners application for registration of title was withdrawn from public use.
Then it follows that such withdrawn portion becomes patrimonial property of the State. It is also very clear from the Charter
that property thus withdrawn from public servitude may be used or conveyed for any purpose for which other real
property belonging to the City may be lawfully used or conveyed.

3. MINDANAO BUS COMPANY V. CITY ASSESSOR AND TREASURER 6 SCRA 197

FACTS: Petitioner is engaged in a public utility business, solely engaged in transporting passengers and cargoes by motor
trucks, over its authorized lines in Mindanao. It owns a main office and branch offices. To be found in their offices are
machineries and equipment, which were assessed by the City Assessor as real properties.

ISSUE: WON the machineries and equipment are real properties

HELD: Movable equipment to be immobilized in contemplation of law must first be essential and principal elements of an
industry or works without which such industry or works would be unable to function or carry on the industrial purpose
for which it was established. We may here distinguish those movables, which are essential and principal elements of an
industry, from those which may not be so considered immobilized by destination because they are merely incidental,
not essential and principal. In the case at bar, the tools and equipment in question are by their nature not essential and
principal elements of petitioners business of transporting passengers and cargoes by motor trucks. They are merely
incidentals.

4. DAVAO SAW MILL CO. VS. CASTILLO G.R. No. L-40411 August 7, 1935
FACTS: Petitioner is the holder of a lumber concession. It operated a sawmill on a land, which it doesnt own. Part of the
lease agreement was a stipulation in which after the lease agreement, all buildings and improvements would pass to the
ownership of the lessor, which would not include machineries and accessories. In connection to this, petitioner
had in its sawmill machineries and other equipment wherein some were bolted in foundations of cement.

Issue: Whether or not the subject properties are movable in nature.

HELD: The machinery must be classified as personal property. The lessee placed the machinery in the building erected on
land belonging to another, with the understanding that the machinery was not included in the improvements which would
pass to the lessor on the expiration of the lease agreement. The lessee also treated the machinery as personal property
in executing chattel mortgages in favor of third persons. The machinery was levied upon by the sheriff as personalty pursuant
to a writ of execution obtained without any protest being registered. Furthermore, machinery only becomes immobilized
when placed in a plant by the owner of the property or plant, but not when so placed by a tenant, usufructuary,
or any person having temporary right, unless such person acted as the agent of the owner.
 5. PRUDENTIAL BANK V. PANIS, 153 SCRA 390

FACTS: Spouses Magcale secured a loan from Prudential Bank. To secure payment, they executed a real estate mortgage
over a residential building. The mortgage included also the right to occupy the lot and the information about the sales
patent applied for by the spouses for the lot to which the building stood. After securing the first loan, the spouses
secured another from the same bank. To secure payment, another real estate mortgage was executed over the same
properties.

The Secretary of Agriculture then issued a Miscellaneous Sales Patent over the land which was later on mortgaged to the
bank.

The spouses then failed to pay for the loan and the REM was extrajudicially foreclosed and sold in public auction despite
opposition from the spouses. The respondent court held that the REM was null and void.

ISSUE: Whether or not a valid mortgage can be constituted on the building erected on the belonging to another.

HELD: A real estate mortgage can be constituted on the building erected on the land belonging to another. The inclusion
of building distinct and separate from the land in the Civil Code can only mean that the building itself is an immovable
property. While it is true that a mortgage of land necessarily includes in the absence of stipulation of the improvements
thereon, buildings, still a building in itself may be mortgaged by itself apart from the land on which it is built. Such a
mortgage would still be considered as a REM for the building would still be considered as immovable property even if
dealt with separately and apart from the land. The original mortgage on the building and right to occupancy of the land
was executed before the issuance of the sales patent and before the government was divested of title to the land. Under
the foregoing, it is evident that the mortgage executed by private respondent on his own building was a valid mortgage.
As to the second mortgage, it was done after the sales patent was issued and thus prohibits pertinent provisions of the
Public Land Act.

6. Benguet Corporation vs Central Board of Assessment

Facts: The controversy arose in 1985 when the Provincial Assessor of Zambales assessed the said properties as taxable
improvements. The assessment was appealed to the Board of Assessment Appeals of the Province of Zambales but was
dismissed mainly on the ground of the petitioner's failure to pay the realty taxes that fell due during the pendency of the
appeal. The petitioner seasonably elevated the matter to the Central Board of Assessment Appeals, one of the herein
respondents. In its decision dated March 22, 1990, the Board reversed the dismissal of the appeal but, on the merits, agreed
that the tailings dam and the lands submerged thereunder were subject to realty tax.

Issue: WON tailing dams are subject to realty tax?

Held: The petitioner does not dispute that the tailings dam may be considered realty within the meaning of Article 415. The
Real Property Tax Code does not carry a definition of "real property" and simply says that the realty tax is imposed on "real
property, such as lands, buildings, machinery and other improvements affixed or attached to real property." In the absence of
such a definition, we apply Article 415 of the Civil Code: From the definitions and the cases cited above, it would appear that
whether a structure constitutes an improvement so as to partake of the status of realty would depend upon the degree
of permanence intended in its construction and use. The expression "permanent" as applied to an improvement does not
imply that the improvement must be used perpetually but only until the purpose to which the principal realty is devoted has
been accomplished. It is sufficient that the improvement is intended to remain as long as the land to which it is annexed is
still used for the said purpose. The Court is convinced that the subject dam falls within the definition of an "improvement"
because it is permanent in character and it enhances both the value and utility of petitioner's mine. Moreover, the
immovable nature of the dam defines its character as real property under Article 415 of the Civil Code and thus makes it
taxable under Section 38 of the Real Property Tax Code.

7. PHILIPPINE REFINING CO. vs. JARQUE,COROMINAS G.R. No. L-41506

FACTS: Plaintiff Philippine Refining Co. and defendant Jarque executed three mortgages on the motor vessels Pandan and
Zargazo. The documents were recorded as transfer and encumbrances of the vessels for the port of Cebu and each was
denominated a chattel mortgage. The first two mortgages did not have an affidavit of good faith. A fourth mortgage was
executed by Jarque and Ramon Aboitiz over motorship Zaragoza and was entered in the Chattel Mortgage Registry on May
12, 1932, within the period of 30 days prior to the foreclosure/institution of the insolvency proceedings.

ISSUE: 1. Whether or not the mortgages of the vessels are governed by the Chattel Mortgage Law

HELD: Personal property includes vessels. They are subject to the provisions of the Chattel Mortgage Law. The Chattel
Mortgage Law says that a good chattel mortgage includes an affidavit of good faith. The absence of such affidavit makes
mortgage unenforceable against creditors and subsequent encumbrances. Note that a mortgage on a vessel is generally like
other chattel mortgages. The only difference between a chattel mortgage of a vessel and a chattel mortgage of other
personalty is that the first must be noted in the registry of the register of deeds.
8. TUMALAD V. VICENCIO 41 SCRA 143
FACTS: Vicencio and Simeon executed a chattel mortgage in favor of plaintiffs Tumalad over their house, which was being
rented by Madrigal and company. This was executed to guarantee a loan, payable in one year with a 12% per annum
interest. The mortgage was extrajudicially foreclosed upon failure to pay the loan. The house was sold at a public auction and
the plaintiffs were the highest bidder. A corresponding certificate of sale was issued. Thereafter, the plaintiffs filed an action
for ejectment against the defendants, praying that the latter vacate the house as they were the proper owners.

ISSUE: W/N the chattel mortgage was null and void ab initio because only personal properties can be subject of a chattel
mortgage.

HELD: Certain deviations have been allowed from the general doctrine that buildings are immovable property such as when
through stipulation, parties may agree to treat as personal property those by their nature would be real property. This is
partly based on the principle of estoppel wherein the principle is predicated on statements by the owner declaring his house
as chattel, a conduct that may conceivably stop him from subsequently claiming otherwise. In the case at bar, though there
be no specific statement referring to the subject house as personal property, yet by ceding, selling or transferring a property
through chattel mortgage could only have meant that defendant conveys the house as chattel, or at least, intended to treat
the same as such, so that they should not now be allowed to make an inconsistent stand by claiming otherwise.

9. Sergs Products, Inc. vs. PCI Leasing G.R. No. 137705. August 22, 2000
FACTS: PCI Leasing and Finance filed a complaint for sum of money, with an application for a writ of replevin. Judge issued a
writ of replevin directing its sheriff to seize and deliver the machineries and equipment to PCI Leasing after 5 days and upon
the payment of the necessary expenses. The sheriff proceeded to petitioner's factory, seized one machinery, with word that
he would return for other machineries. Petitioner (Sergs Products) filed a motion for special protective order to defer
enforcement of the writ of replevin. PCI Leasing opposed the motion on the ground that the properties were still personal
and therefore can still be subjected to seizure and writ of replevin. Petitioner asserted that properties sought to be seized
were immovable as defined in Article 415 of the Civil Code. Sheriff was still able to take possession of two more machineries
In its decision on the original action for certiorari filed by the Petitioner, the appellate court, Citing the Agreement of the
parties, held that the subject machines were personal property, and that they had only been leased, not owned, by
petitioners; and ruled that the "words of the contract are clear and leave no doubt upon the true intention of the contracting
parties.

ISSUE: Whether or not the machineries became real property by virtue of immobilization.

HELD: Writ of Replevin: Rule 60 of the Rules of Court provides that writs of replevin are issued for the recovery of personal
property only.

Article 415 (5) of the Civil Code provides that machinery, receptacles, instruments or implements intended by the owner of
the tenement for an industry or works which may be carried on in a building or on a piece of land, and which tend directly to
meet the needs of the said industry or works

In the present case, the machines that were the subjects of the Writ of Seizure were placed by petitioners in the factory built
on their own land.They were essential and principal elements of their chocolate-making industry.Hence, although each of
them was movable or personal property on its own, all of them have become immobilized by destination because they are
essential and principal elements in the industry.

However, contracting parties may validly stipulate that a real property be considered as personal. After agreeing to such
stipulation, they are consequently estopped from claiming otherwise.Under the principle of estoppel, a party to a contract is
ordinarily precluded from denying the truth of any material fact found therein.

Section 12.1 of the Agreement between the parties provides The PROPERTY is, and shall at all times be and remain, personal
property notwithstanding that the PROPERTY or any part thereof may now be, or hereafter become, in any manner affixed or
attached to or embedded in, or permanently resting upon, real property or any building thereon, or attached in any manner
to what is permanent.

The machines are personal property and they are proper subjects of the Writ of Replevin

10. US V. TAMBUNTING
FACTS: The Manila Gas Company installed equipment for the transmission of gas in a house at Evangelista. After the original
subscriber left, the apparatus was sealed and the services discontinued. Later Mr. Tambunting moved in. He was a
cheapskate and spliced the tubing to leech free gas for household use. Alas, the crime was discovered by the gas company.

ISSUE: Whether or not gas can be the subject of larceny.

HELD: Gas is a substance which lends itself to felonious appropriation. It is a valuable merchandise that can be bought and
sold like other personal property, susceptible of being siphoned from a larger mass and transported from place to place.
Articles 517 and 518 sets parameters for the theft of gas and it is a valid ordinance.
11. CHAVEZ V. PUBLIC ESTATES AUTHORITY 384 SCRA 152
FACTS: President Marcos through a presidential decree created PEA, which was tasked with the development,
improvement, and acquisition, lease, and sale of all kinds of lands. The then president also transferred to PEA the foreshore
and offshore lands of Manila Bay under the Manila-Cavite Coastal Road and Reclamation Project. Thereafter,
PEA was granted patent to the reclaimed areas of land and then, years later, PEA entered into a JVA with AMARI for the
development of the Freedom Islands. These two entered into a joint venture in the absence of any public
bidding. Later, a privilege speech was given by Senator President Maceda denouncing the JVA as the grandmother of all
scams. An investigation was conducted and it was concluded that the lands that PEA was conveying to AMARI were lands
of the public domain; the certificates of title over the Freedom Islands were void; and the JVA itself was illegal. This
prompted Ramos to form an investigatory committee on the legality of the JVA.

ISSUE: W/N stipulations in the amended JVA for the transfer to AMARI of the lands, reclaimed or to be reclaimed,
violate the Constitution.

HELD:
The ownership of lands reclaimed from foreshore and submerged areas is rooted in the Regalian doctrine, which holds that
the State owns all lands and waters of the public domain.The 1987 Constitution recognizes the Regalian doctrine. It declares
that all natural resources are owned by the State and except for alienable agricultural lands of the public domain, natural
resources cannot be alienated. The Amended JVA covers a reclamation area of 750 hectares. Only 157.84 hectares of the 750
hectare reclamation project have been reclaimed, and the rest of the areas are still submerged areas forming part of Manila
Bay. Further, it is provided that AMARI will reimburse the actual costs in reclaiming the areas of land and it will
shoulder the other reclamation costs to be incurred. The foreshore and submerged areas of Manila Bay are part of the lands
of the public domain, waters and other natural resources and consequently owned by the State. As such, foreshore and
submerged areas shall not be alienable unless they are classified as agricultural lands of the public domain. The mere
reclamation of these areas by the PEA doesnt convert these inalienable natural resources of the State into alienable and
disposable lands of the public domain. There must be a law or presidential proclamation officially classifying these reclaimed
lands as alienable and disposable if the law has reserved them for some public or quasi-public use.

12. HEIRS OF OLVIGA V COURT OF APPEALS

FACTS: Eutequio Pureza and his father cultivated a forest land in 1950. The same land was surveyed in 1954 by the Bureau of
Lands in the name of Eutequio Pureza and has since been known as Lot 13,Pls-84. However, Godofredo Olviga protested and
claimed that 1/2 hectare of the surveyed land belonged to him and not to Pureza. In 1960, Pureza filed a homestead
application over Lot 13. Since his application had not been acted upon, he transferred his rights in said land to Cornelio Glor.
Unfortunately, the said transfer was also not acted upon by the Director of Lands for undisclosed reasons. In 1967, Jose
Olviga obtained a registered title for Lot 13 in a cadastral proceeding in fraud of Pureza and Cornelio Glor. He also failed to
disclose that the land in dispute was currently in possession of the Glors. Angelita Glor, wife of Cornelia Glor, testified that
she did not receive any notice about the said proceedings. Glor then filed an action for reconveyance over Lot 13.

ISSUE: Whether or not the action for reconveyance has already prescribed.

HELD: The rule that an action for reconveyance of a parcel of land based on implied or constructive trust prescribes in 10
years cannot be applied in this case because it only applies when the plaintiff is not in possession of the property. However, if
a person claiming to be owner of the property is in actual possession of the property,in this case the Glors, then their right to
seek reconveyance does not prescribe. In Faja vs CA, it was held that the owner who is in actual possession of the property
may wait until his possession is disturbed or his title is attacked before taking steps to vindicate his right. The cause of action
should be considered to have accrued not from the date of registration of the title of Olviga over Lot 13 in 1967, but on 1988
when the Glors gained knowledge of the said proceedings.

13. PINGOL V. COURT OF APPEALS

FACTS: A vendee in an oral contract to convey land who had made part payment thereof, entered upon the land and had
made valuable improvements thereon is entitled to bring suit to clear his title against the vendor who had refused to transfer
the title to him. It is not necessary that the vendee should have an absolute title, an equitable title being sufficient to clothe
him with personality to bring an action to quiet title. FACTS: In 1969, Pingol, the owner of a lot (Lot No. 3223) in Caloocan
City, executed a DEED OF ABSOLUTE SALE OF ONE-HALF OF AN UNDIVIDED PORTION OF [his] PARCEL OF LAND in favor of
Donasco (private respondent), payable in 6 years. In 1984, Donasco died and was only able to pay P8,369 plus P2,000
downpayment, leaving a balance of P10,161. The heirs of Donasco remained in possession of such lot and offered to settle
the balance with Pingol. However, Pingol refused to accept the offer and demanded a larger amount. Thus, the heirs of
Donasco filed an action for specific performance (with Prayer for Writ of Prelim. Injunction, because Pingol were encroaching
upon Donascos lot). Pingol averred that the sale and transfer of title was conditional upon the full payment of Donasco
(contract to sell, not contract of sale). With Donascos breach of the contract in 1976 and death in 1984, the sale was deemed
cancelled, and the heirs continuous occupancy was only being tolerated by Pingol.

ISSUES: Whether or not Donasco has the right to quiet title

HELD: Although the complaint filed by the Donascos was an action for specific performance, it was actually an action to quiet
title. A cloud has been cast on the title, since despite the fact that the title had been transferred to them by the execution of
the deed of sale and the delivery of the object of the contract, Pingol adamantly refused to accept the payment by Donascos
and insisted that they no longer had the obligation to transfer the title. Donasco, who had made partial payments and
improvements upon the property, is entitled to bring suit to clear his title against Pingol who refused to transfer title to him.
It is not necessary that Donasco should have an absolute title, an equitable title being sufficient to clothe him with
personality to bring an action to quiet title. Prescription cannot also be invoked against the Donascos because an action to
quiet title to property in ONEs POSSESSION is imprescriptible.

14. TUMALAD V. VICENCIO 41 SCRA 143

FACTS: Vicencio and Simeon executed a chattel mortgage in favor of plaintiffs Tumalad over their house, which was being
rented by Madrigal and company. This was executed to guarantee a loan, payable in one year with a 12% per annum
interest. The mortgage was extrajudicially foreclosed upon failure to pay the loan. The house was sold at a public auction and
the plaintiffs were the highest bidder. A corresponding certificate of sale was issued. Thereafter, the plaintiffs filed an action
for ejectment against the defendants, praying that the latter vacate the house as they were the proper owners.

ISSUE: W/N the chattel mortgage was null and void ab initio because only personal properties can be subject of a chattel
mortgage.

HELD: Certain deviations have been allowed from the general doctrine that buildings are immovable property such as when
through stipulation, parties may agree to treat as personal property those by their nature would be real property. This is
partly based on the principle of estoppel wherein the principle is predicated on statements by the owner declaring his house
as chattel, a conduct that may conceivably stop him from subsequently claiming otherwise. In the case at bar, though there
be no specific statement referring to the subject house as personal property, yet by ceding, selling or transferring a property
through chattel mortgage could only have meant that defendant conveys the house as chattel, or at least, intended to treat
the same as such, so that they should not now be allowed to make an inconsistent stand by claiming otherwise.

15. BA Finance Corp vs. CA GR 61464, May 28 1988

FACTS: Augusto Yulo secured a loan from the petitioner in the amount of P591,003.59 as evidenced by a promissory note he
signed in his own behalf and as a representative of A&L Industries. Augusto presented an alleged special power of attorney
executed by his wife, Lily Yulo, who managed the business and under whose name the said business was registered,
purportedly authorized the husband to procure the loan and sign the promissory note. 2months prior the procurement of
the loan, Augusto left Lily and their children which in turn abandoned their conjugal home. When the obligation became due
and demandable, Augusto failed to pay the same. The petitioner prayed for the issuance of a writ of attachment alleging that
said spouses were guilty of fraud consisting of the execution of Deed of Assignment assigning the rights, titles and interests
over a construction contract executed by and between the spouses and A. Soriano Corporation. The writ hereby prayed for
was issued by the trial court and not contented with the order, petitioner filed a motion for the examination of attachment
debtor alleging that the properties attached by the sheriff were not sufficient to secure the satisfaction of any judgment
which was likewise granted by the court.

ISSUE: WON A&L Industries can be held liable for the obligations contracted by the husband.

HELD: A&L Industries is a single proprietorship, whose registered owner is Lily Yulo. The said proprietorship was established
during the marriage and assets were also acquired during the same. Hence, it is presumed that the property forms part of
the conjugal partnership of the spouses and be held liable for the obligations contracted by the husband. However, for the
property to be liable, the obligation contracted by the husband must have redounded to the benefit of the conjugal
partnership. The obligation was contracted by Augusto for his own benefit because at the time he incurred such obligation,
he had already abandoned his family and left their conjugal home. He likewise made it appear that he was duly authorized by
his wife in behalf of the company to procure such loan from the petitioner. Clearly, there must be the requisite showing that
some advantage accrued to the welfare of the spouses. Thus, the Court ruled that petitioner cannot enforce the obligation
contracted by Augusto against his conjugal properties with Lily. Furthermore, the writ of attachment cannot be issued against
the said properties and that the petitioner is ordered to pay Lily actual damages amouting to P660,000.00.
16. PHILIPPINE ECONOMIC ZONE AUTHORITY (PEZA) V. FERNANDEZ
FACTS: Lot 4673 was registered in the names of Florentina Rapaya, Victorino Cuizon among others covered by an OCT.
Sometime thereafter, Jorgea Igot-Soro o et al executed an Extra-judicial Partition claiming to be the only surviving heirs of
the registered owners, through which they were issued a TCT. Said lot was among the object of an expropriation proceeding
before the RTC. Said RTC approved the compromise Agreement b/w the Export Processing Zone Authority (EPZA) and Igot-
Soroo et al wherein EPZA would pay a certain amount in exchange for the subject property. EPZA acquired title to said land
by virtue of the RTC decision and was issued a corresponding TCT. The Heirs of the Florentina Rapaya and Juan Cuizon filed a
complaint to nullify several documents including the TCT issued to EPZA for they were excluded from the extrajudicial
settlement of the estate. EPZA filed a motion to dismiss on the ground of prescription and was denied thus elevated the case
to the CA wherein the CA ruled that the heirs of Igot-Soroo defrauded the other heirs by falsely representing that they were
the only heirs enabling them to appropriate the land in favor of EPZA. This method of acquiring property created a
constructive trust in favor of the defrauded party and grants them the right to vindicate regardless of the lapse of time

ISSUE/S:
1) Whether or not private respondents claim over the expropriated land has prescribed
2) Whether or not reconveyance lies against expropriated property

HELD:
1) YES. As provided in the Rules of Court, persons unduly deprived of their lawful participation in a settlement may assert
their claim only w/in the 2-year period after the settlement and distribution of the estate. However, this prescriptive period
will not apply to those who had not been notified of the settlement. The Private respondents are deemed to have been
notified of the extrajudicial settlement since it was registered and annotated on the certificate of title over the lot. The only
exception to this rule is when the title still remains in the hands of the heirs who have fraudulently caused the partition of the
said property. In the case at bar, the title has already passed to an innocent purchaser for value, the govt through EPZA.
Their remedies of action for reconveyance resulting from fraud, and action for reconveyance based on an implied
constructive trust has already prescribed as well the former having prescribed 4 years from the discovery and the latter
prescribing 10 years from the alleged fraudulent registration.

2) NO. Reconveyance is a remedy for those whose property has been wrongfully or erroneously registered in anothers name.
However, this cannot be availed once the property has passed to an innocent purchaser for value. Since the property has
already passed to the govt in an expropriation proceeding, EPZA is entitled to enjoy the security afforded innocent 3rd
persons and their title to the property must be preserved. However, the private respondents are not w/o remedy. They can
sue for damages their co-heirs.

17. Vda de Nazareno vs. CA

Facts: The husband and wife, in order to avoid paying estate tax, while they are alive, executed several Deeds of Sale in favor
of their children. The sale was proven to be without consideration.

Issue: Whether or not the subject properties of the Deeds of Sale are part of the estate of the deceased.

Held: No, the children never acquired ownership because the sale was void for lack of consideration. The sale to a Natividad,
one of the children, is deemed in trust for the other children of the deceased. The properties should be collated as part of the
estate.

18. BAES V. COURT OF APPEALS

Overview: the rules on alluvion do not apply to man-made or artificial accretions or to accretions to lands that adjoin canals
or esteros or artificial drainage systems. If the riparian owner is entitled to compensation for the damage to or loss of his
property due to natural causes, there is all the more reason to compensate him when the change in the course of the river is
effected through artificial means.

FACTS: In 1962, the Government dug up a canal on a private estate in order to streamline the Tripa de Gallina creek (in other
words, there was a mand-made change of river course). Said private estate was acquired by petitioner Baes, and was
subdivided in to three lots. It was lot 2958-C which was totally occupied by the canal so the Government in exchange granted
him a lot near but not contiguous to C. The old river bed was filled up by soil from Lot C. Petitioner now claims ownership
over the old river bed on the basis of Article 461 which says that abandoned river beds belong to the riparian owners whose
land is occupied by the new course of water.

ISSUE: Whether or not Article 461 applies

HELD: If the riparian owner is entitled to compensation for the damage to or loss of his property due to natural causes, there
is all the more reason to compensate him when the change in the course of the river is effected through artificial means. The
loss to the petitioners of the land covered by the canal was the result of a deliberate act on the part of the government when
it sought to improve the flow of the Tripa de Gallina creek. It was therefore obligated to compensate the Baeses for their loss.
19. BINALAY VS. MANALO
A sudden and forceful action like that of flooding is not the alluvial process contemplated in Art. 457. The accumulation of the
soil deposits must be slow and hardly imperceptible in order for the riparian owner to acquire ownership thereof. Also, the
land where the accretion takes place is adjacent to the banks of the rivers (or the sea coast).

FACTS: Manalo acquired 2 lots which were originally owned by Judge Taccad from 2 different people (the latters daughter
and from an earlier purchaser). These lots were later consolidated into Lot 307, a total of 10.45 hectares. The lot was beside
the Cagayan River, which, due to flooding, would place a portion of the land underwater during the rainy season (September
to December). On sunny days, however, the land would be dried up for the entire dry season (January to August). When a
survey of the land was conducted on a rainy month, a portion of the land that Manalo bought was then underwater and was
thus left unsurveyed and excluded from Lot 307.

The big picture is this: Cagayan River running from south to north, forks at a certain point to form two braches (western and
eastern) and then unites at the other end, further north, to form a narrower strip of land. The eastern branch of the river cuts
through Lot 307, and is flooded during the rainy season. The unsurveyed portion, on the other hand, is the bed of the eastern
branch. Note that the fork exists only during the rainy season while the island/elongated strip of land formed in the middle
of the forks becomes dry and perfect for cultivation when the Cagayan river is at its ordinary depth. The strip of land in the
middle of the fork totaled 22.7 hectares and was labeled Lot 821-822. Lot 821 is directly opposite Lot 307 and is separated by
the eastern branch of the rivers fork.

Manalo claims that Lot 821 belongs to him by way of accretion to the submerged portion of the land to which it is adjacent.
Petitioners (Binalay, et al) who possess the Lot 821, on the other hand, insist that they own it. They occupy the other edges of
the lot along the river bank (i.e. the fertile portions on which they plant tobacco and other agricultural products) and also
cultivate the western strip during the summer.

Manalo filed 2 cases for forcible entry which were both dismissed. Later on, he filed a complaint for quieting of title,
possession, and damages against petitioner. The trial court and the CA ruled in favor of Manalo, saying that Lot 821 and Lot
307 cannot be considered separate and distinct from each other. They reasoned that when the land dries up for the most
part of the year, the two are connected. [Note: The CA applied the ruling in Govt of the Phil Islands vs. Colegio de San Jose,
which was actually inappropriate because the subject matter in this case was a lake so that the definition of a bed was
different.]

ISSUE: Whether or not Manalo owns Lot 821 by way of accretion

HELD: The disputed property is not an accretion. It is the action of the heavy rains that cause the highest ordinary level of
waters of the Cagayan River during the rainy season. The depressed portion is a river bed and is thus considered property of
public domain.
The SC observed the following:
a) The pictures identified by Manalo during his direct examination depict the depressed portion as a river bed. The dried up
portion had dike-like slopes (around 8m) on both sides connecting it to Lot 307 and Lot 821 that are vertical and very
prominent.
b) The eastern bed already existed even before Manalo bought the land. It was called Rio Muerte de Cagayan.
c) Manalo could not have acquire ownership of the land because article 420 of the civil code states that rivers are property of
public dominion. The word river includes the running waters, the bed, and the banks. [The seller never actually owned that
part of the land since it was public property]
d) The submerged area (22.72 ha) is twice the area of the land he actually bought. It is difficult to suppose that such a sizable
area could have been brought about by accretion.
More importantly, the requisites of accretion in article 457 were not satisfied. These are: 1) that the deposition of the soil or
sediment be gradual and imperceptible; 2) that it be the result of the action of the waters of the river (or sea); and 3) the land
where the accretion takes place is adjacent to the banks of the rivers (or the sea coast). The accretion shouldve been
attached to Lot 307 for Manalo to acquire its ownership. BUT, the claimed accretion lies on the bank of the river; not adjacent
to Lot 307 but directly opposite it across the river. Aside from that, the dike-like slopes which were very steep may only be
formed by a sudden and forceful action like flooding. The steep slopes could not have been formed by the river in a slow and
gradual manner.
20. J.M. TUASON and CO., INC. V ESTRELLA VDA. DE LUMANLAN and CA G.R. No: L-23497
FACTS: J.M. Tuason & Co Inc (Tuason) filed a case against Lumanlan after the latter unlawfully entered into its property
known as Santa Mesa Heights Subdivision (situated at Barrio North Tatalon, Quezon City). Lumanlan took possession of 800
sq m land and constructed her house on the said land. Tuason prays for ejectment and damages for occupancy. Lumanlan
argues that she had brought the property from one Pedro Deudor and that there is a Compromise Agreement between
Deudor and Tuason stating that she was one of the buyers recognized therein.

ISSUE: Whether or not J.M. Tuason and Co., Inc is the rightful owner of the said land?

HELD: A careful analysis of the compromise agreement will show that in no way did it obligate Tuason to sell to those buyers
the lots occupied by them at the price stipulated by the Deudors, but at the current prices and terms specified by the
OWNERS (Tuason) in their sales of lots. (See notes for paragraph 7 of compromise agreement). Paragraph 7 also imports that
these buyers of the Deudors must (1) recognize the title of the OWNERS (Tuason) over the property purportedly bought by
them and from the Deudors, and (2) sign, whenever possible, new contracts of purchase for said property. The agreement
also states that the sums paid by them to the Deudors...shall be credited to the buyers. All that Tuason agreed to was to
grant the Deudor buyers preferential right to purchase at current prices and terms upon recognizing the title of Tuason and
signing new contracts and to credit to them for the amounts they had paid to the Deudors. Lumanlan never claimed that she
had signed a new contract with Tuason for the puchase of the lot occupied. Instead of recognizing the title of Tuason as
required by the agreement, she used paragraph 6 of the agreement for her special defense, arguing that Deudor and Tuason
entered into the compromise agreement where Deudor and his co-owners renouced, ceded, waived, and quitclaimed all their
rights in the property in favor of Tuason without her knowledge and consent. Now she does not rely on the compromise
agreement but she assails it. Without the compromise agreement, Lumanlan must justify her possession on the basis of a
pretended superiority of the Deudors old Spanish nformacion posesoria over Tuasons Certificate of Title No. 1267. But the
Court has already ruled in previous cases that Lumanlan is barred from assailing the decree of registration in favor of
Tuasons predecessors 20 years after its issuance. The agreement provides that the Deudor buyers should sign new contracts
with it at current prices specified for the sales of lots. Article 1474 of the Civil Code does not apply in this case because
Lumanlan is not a buyer from Tuason since there is no contract between the two. Lumanlans argument that she should be
deemed a builder in good faith does not hold water. In a related case (Tuason v Macalindong), the Court ruled that there
being a presumptive knowledge of the Torrents titles issued to Tuason, the buyer from the Deudors cannot say now that she
believer her vendor had rights of ownership over the lot purchaser. She had chose to ignore the Torrens title of Tuason and
relied instead upon the Deudors claim of ownership, perhaps because such course appeared to her as more advantageous;
hence, she has only herself to blame for the consequences now that the Deudors' claim has been abandoned by the Deudors
themselves, and can not pretend good faith.

21. GABOYA V. CUI

FACTS: Don Mariano sold his 2 lots to two of his children. Later on, he and his children became co-owners of the property.
Don Mariano executed a deed authorizing the children to apply for a loan w/ mortgage with a stipulation reserving his right
to the fruits of the land. The children then constructed a building on the land and collected rent from the lessee thereof.
Much later, when Don Mariano died, his estate was claiming the fruits of the building.

ISSUE: Whether or not Don Mariano had a right to fruits of the building

HELD: The deed expressly reserved only to his right to the fruits of the land. He only owned the rent for the portion of land
occupied by the building; thus, the estate could only claim the rent on that piece of land and not on the entire parcel of land.
The children are entitled to the rents of the building. (A usufruct on the land may be separate from the building. There should
be no rescission of the contract coz the exact amount of rent due and owing to the Don Marianos estate is still unliquidated
and undetermined. The trial court has the discretion to grant the debtor (children) a period within which to pay the rental
income from the portion of land owned by the building because the same has not yet been determined. Article 1191 of the
Civil Code grants the right to rescind but subject to the period that the court will grant. Moreover, on the issue of co-
ownership, the court held that a co-owner cannot simultaneously be a usufructuary of the same land owned.

22. MWSS V. CA, CITY OF DAGUPAN, 143 SCRA 623

FACTS: The City of Dagupan (CITY) filed a complaint against the former National Waterworks and Sewerage Authority
(NAWASA), now the Metropolitan Waterworks and Sewerage System (MWSS), for recovery of the ownership and possession
of the Dagupan Waterworks System. NAWASA interposed as one of its special defenses R.A. 1383 which vested upon it the
ownership, possession and control of all waterworks systems throughout the Philippines and as one of its counterclaims the
reimbursement of the expenses it had incurred for necessary and useful improvements amounting to P255,000.00. Judgment
was rendered by the trial court in favor of the CITY on the basis of a stipulation of facts. The trial court found NAWASA to be a
possessor in bad faith and hence not entitled to the reimbursement claimed by it.

ISSUE: Whether or not MWSS has the right to remove all the useful improvements introduced by NAWASA to the Dagupan
Waterworks System, notwithstanding the fact that NAWASA was found to be a possessor in bad faith
HELD: Article 449 of the Civil Code of the Philippines provides that "he who builds, plants or sows in bad faith on the land of
another, loses what is built, planted or sown without right to indemnity." As a builder in bad faith, NAWASA lost whatever
useful improvements it had made without right to indemnity. Moreover, under Article 546 of said code, only a possessor in
good faith shall be refunded for useful expenses with the right of retention until reimbursed; and under Article 547 thereof,
only a possessor in good faith may remove useful improvements if this can be done without damage to the principal thing
and if the person who recovers the possession does not exercise the option of reimbursing the useful expenses. The right
given a possessor in bad faith is to remove improvements applies only to improvements for pure luxury or mere pleasure,
provided the thing suffers no injury thereby and the lawful possessor does not prefer to retain them by paying the value they
have at the time he enters into possession (Article 549).

23. PLEASANTVILLE DEVELOPMENT CORPORATION VS. CA

Doctrine: Good faith consists in the belief of the builder that he land he is building on is his and his ignorance of any defect or
flaw in his title. The burden of proving bad faith belongs to the one asserting it.

Facts: Edith Robillo purchased from Pleasantville Development Corporation, herein petitioner a parcel of land at Pleasantville
Subdivision, Bacolod City. The property was designated as Lot 9, Phase II. In 1975,herein respondent Eldred Jardinico bought
the said subject lot from the former purchaser. Eldred later discovered that the property he purchased had improvements
introduced therein by respondent WilsonKee. Kee on the other hand bought on installments Lot 8 of the same subdivision
from C.T. Torres Enterprises, Inc. (CTTEI) which is the exclusive real estate agent of the petitioner. Under the contract Kee
was allowed to take possession of the property even before full payment of the price. CTTEI through an employee, Zenaida
Octaviano accompanied Kees wife Donabelle to inspect Lot No. 8. Octaviano however mistakenly pointed towards Lot 9.
Hence spouses Kee had their residence, an auto repair shop,a store and other improvements constructed on the wrong lot.
Upon discovery of the blunder both Kee and Jardinico tried to reach an amicable settlement but they failed. Jardinico
demanded that the improvements be removed but as Kee refused, Jardinico filed a complaint for ejectment with damages
against Kee at the Municipal Trial Court in Cities (MTCC) of Bacolod City. Kee filed a third-party complaint against herein
petitioner and CTTEI. The MTCC found that the error was attributable to CTTEI also since at present the contract with
Kee has rescinded for Kees failure to pay installments. Kee no longer had any right over the subject property and must pay
rentals for its use. The Regional Trial Court (RTC) of Bacolod City ruled that petitioner and CTTEI were not at fault or were not
negligent. It argued that Kee was a builder in bad faith. Even if assuming that he was in good faith, he was no longer so and
must pay rentals from the time that he was given notice to vacate the lot. The Court of Appeals ruled that Kee was a builder
in good faith as he was unaware of the mix-up when he constructed the improvements. It was in fact due to the negligence
and wrongful delivery of CTTEI which included its principal the herein petitioner. It further ruled that the award of rental
was without basis. Pending the resolution of the case at the Court of Appeals Jardinico and Kee entered into a deed of sale,
wherein Lot 9 was sold to Kee. In the said deed a provision stating that regardless of the outcome of the decision, such shall
not be pursued by the parties and shall be considered dismissed and without effect. The appellate court was not informed of
this deal.

Issue: Whether or not a lot buyer who constructs improvements on the wrong property erroneously delivered by the owners
agent, a builder in good faith?

Held:
Yes. Article 527 of the Civil Code provides the presumption that petitioner has the burden of proving that Kee was a builder in
bad faith. Kee may be made liable for the violation of the contract with CTTEI but this may not be used as a basis of bad faith
and as a sufficient ground to negate the presumption of good faith. Jardinico is presently only allowed to file a complaint for
unlawful detainer. Good faith is based on the belief of the builder that the land he is building on is his and his ignorance of
any flaw or defect in is title. Since at the time when Kee constructed his improvements on Lot 8, he wasnot aware that it was
actually Lot 9 that was delivered to him. Petitioner further contends that Kee was negligent as a provision in the Contract of
Sale on Installment stated that the vendee must have

24. Adlawan vs. Adlawan

FACTS: A house and lot (lot 7226) was registered in the name of Dominador Adlawan, the father of (petitioner) Arnelito
Adlawan. He is the acknowledged illegitimate child of Dominador who is claiming that he is the sole heir. He then adjudicated
to himself the said house and lot to himself and out of generosity allowed the siblings of his father to occupy the property
provided that they vacate when asked. Time came when he demanded that they vacate and when they refused he filed an
ejectment suit against them. His aunt and uncle on the other hand, Narcisa (70) and Emeterio (59) denied his allegations
claiming that the said lot was registered in their parents name and they had been living in the said house and lot since birth.
The only reason why the said house and lot was transferred in Dominadors name was when their parents were in need of
money for renovating their house, their parents were not qualified to obtain a loan and since Dominador was the only one
who had a college education, they executed a simulated deed of sale in favor of Dominador.

ISSUE: Whether or not Arnelito can validly maintain the ejectment suit
HELD: The theory of succession invoked by Arnelito would prove that he is not the sole heir of Dominador. Since he was
survived was his wife, upon his death, Arnelito and Graciana became co-owners of the lot. Upon her death, her share passed
on to her relatives by consanguinity thus making them co-owners as well. Petitioner contends that Art. 487 allows him to file
the instant petition. (Art. 487. Any one of the co-owners may bring an action in ejectment.) It is true that a co-owner may
bring such an action w/o necessity of joining all the co-owners as plaintiffs because it is presumed to be instituted for the
benefit of all BUT if the action is for the benefit of the plaintiff alone, the action should be dismissed.
Since petitioner brought the suit in his name and for his benefit alone and his repudiation of the ownership of the other heirs,
the instant petition should be dismissed.

25. Mariano vs Court of Appeals

FACTS: Francisco Gosiengfaio is the registered owner of a parcel of land in Tuguegarao. In his lifetime, he mortgaged the land
to Rural Bank of Tuguegarao to secure payment of a loan. Francisco died in without paying the debt. His intestate heirs were:
his wife Antonia and children Amparo, Carlos, Severo, Grace, Emma, Ester, Francisco, Jr., Norma, Lina, and Jacinto. The bank
foreclosed on the mortgage but before the redemption period expired, Antonia, Emma, Lina, Norma, Lina, Carlos and Severo
executed a deed of assignment of the right of redemption in favor of Amparo. Amparo later on sold the land to Spouses
Mariano. Grace Gosengfiao, and the other heirs excuded in the deed of assignment filed a complaint for recovery and legal
redemption with damages against spouses Mariano.

ISSUE: Whether or not a co-owner who redeems the whole property with her own personal funds becomes the sole owner of
said property and terminates the existing state of co-ownership

HELD: Admittedly, as the property in question was mortgaged by the decedent, a co-ownership existed among the heirs
during the period given by law to redeem the foreclosed property. Redemption of the whole property by a co-owner does not
vest in him sole ownership over said property but will inure to the benefit of all co-owners. In other words, it will not end to
the existing state of co-ownership. Redemption is not a mode of terminating a co-ownership. Respondents have not lost their
right to redeem, for in the absence of a written notification of the sale by the vendors, the 30-day period has not even begun
to run.