final property reviewer

8/3/2019 Final Property Reviewer

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PROPERTY

Requisites: (USA)

(a) Utitlity(b) Substantivity

(c) Appropriability or susceptibility toappropriation

Classification: According to Mobility

(1) Immovables or real (Art. 415)

a) immovables by nature (pars 1 and 8) those which cannot be moved from place to

placei. Land, buildings, roads and

constructions of all kinds adhered tothe soil

ii. Mines, quarries, and slag dumps, whilethe matter thereof forms part of thebed, and waters either running or

stagnant

b) immovables by incorporation (pars 2,3, 7) those which are essentially

movables but are attached to an immovablei. Trees, plants, and growing fruits, while

they are attached to the land or forman integral part of an immovable

ii. Everything attached to an immovable ina fixed manner, in such a way that it

cannot be separated therefrom withoutbreaking the material or deterioration

of the objectiii. Fertilizer actually used on a piece of

land

c) immovables by destination (pars 4, 5,6, 9) those which are essentially movablesbut by the purpose for which they have

been placed in an immovablei. Statues, reliefs, paintings or other

objects for use or ornamentation,placed in buildings or on lands by the

owner of the immovable in such amanner that it reveals the intention to

attach them permanently to thetenements

ii. Machinery, receptacles, instruments or

implements intended by the owner ofthe tenement for an industry or workswhich may be carried on in a building

or on a piece of land, and which tenddirectly to meet the needs of the said

industry or worksiii. Animal houses, pigeon-houses,

beehives, fish ponds or breeding placesof similar nature, in case their owner

has placed them or preserves themwith the intention to have them

permanently attached to the land, andforming a permanent part of it; the

animals in these places are included

iv. Docks and structures which, thoughfloating, are intended by their nature

and object to remain at a fixed place ona river, lake, or coast

d) immovables by analogy or by law(par.10)

i. Contracts for public works, and

servitudes and other real rights overimmovable property

(2) Movables (Art. 416 to 417)a) Those movables susceptible to

appropriation which are not included in thepreceding article

b) Real property which by any specialprovision of law is considered as personal

propertyc) Forces of nature which brought under

control by science; and in general, allthings which can be transported from place

to place without impairment of the realproperty to which they are fixed

d) Obligations and actions which have for theirobject movables of demandable sums and

e) Shares of stock of agricultural, commercialand industrial entities although they may

have real estate.

Notes:

Separate treatment by the parties of a

building from the land on which it standsdoes not change the immovable character.

The fact that parties seem to have dealtwith it separate and apart from the land in

no wise changed its character as realproperty. (Leung Yee v. Strong

Machinery) Buildings being immovable by nature,

the ownership of the land on which they areerected cannot change their nature as

immovable property

When trees and plants are cut or

uprooted, they become movables

When ungathered fruits are sold, there

is a sale of movables.

Immovable condition of machineries

depends upon their being destined for usein the industry or work in the tenement.

Where chattel mortgage is constituted

on machinery permanently attached to the

ground, machinery is personal property andmortgage is not null and void, regardless of

who owns the land. (Makati Leasing andFinance Corp v. Wearever Textile Mills)

Intellectual property or the right of theauthor, artist or inventor over his work ispersonal property.

Obligations under Article 418 refer to

credits such as bonds.

Half-interest in a business is personal

property capable of appropriation and maybe subject to mortgage (Strochercker v.

Ramirez)

CasesMachinery which is movable in its nature only

becomes immobilized when placed in a plant by


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Classification According to Ownership

a) Public Dominion

i. intended for public useii. intended for public service of state,

provinces, cities & municipalities

Characteristics:i. outside the commerce of men cannotbe alienated or leasedii. cannot be acquired by private individualthrough prescriptioniii. not subject to attachment &executioniv.cannot be burdened by voluntary

easement

b) Private Ownership

i. patrimonial property of state, provinces,cities, municipalities

-exist for attaining economic ends of

state-property of public dominion when nolonger intended for public use/service

declared patrimonial

ii. property belonging to private persons individually or collectively

CasesReclaimed land is public property. In case of

gradual erosion by the ebb and flow of the tide,private property may become property of the

public domain, where it appears that the ownerabandoned it or permitted it to be destroyed.When they stay in that condition until reclaimedby filling in done by the government, they

continue to be government property afterreclaiming.Immediate possession by the former

owner does not confer on him ownership of thelots, because, as they were converted into

property of the public domain, no privateperson could acquire title except in the form

and manner established by law.(Government of the Philippine Islands v.

Cabangis)

The sale to private parties of a public roadwhich has been validly closed by the city

government is valid. Art 422 of the Civil Codeexpressly provides that property of public

dominion, when no longer intended for publicuse of for public service, shall form part of the

patrimonial property of the State.(Cebu Oxygen and Acetylene v. Bercilles)

The attachment of the municipal trucks, policecars, police station and market stalls is voidbecause the properties levied upon are exempt

from execution. It is generally held thatproperty owned by a municipality, where NOT

used for a public purpose but for quasi-privatepurposes, is subject to execution on a judgment

against a municipality, and may be sold.However, 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.

Property, real and personal, held bymunicipalities in trust for the benefit of their

inhabitants, and used for public purposes, isexempt from execution. (Vda. De Tantoco v.

Municipal Council of Iloilo)

In the absence of a deed or title to any landclaimed by the City as its own, showing that it

was acquired with its private or corporatefunds, the presumption is that such land came

from the State upon the creation of themunicipality. Such property is held in trust forthe benefit of its inhabitants, whether it be for

governmental or proprietary purpose. (Salas v.Jarencio)

Public funds are held in trust for the people,intended and used for the accomplishment of

the purposes for which municipal corporations

are created, and that to subject said propertiesand public funds to executions would materiallyimpede, even defeat, and in some instances,

destroy such purpose. (Municipality of SanMiguel v. Fernandez)

There are 2 norms of classification of property.

Art. 423 and 424 CC provide that except forproperty for public use and public works for

public service paid for by provinces, cities ormunicipalities, All other property possessed by

any of them is patrimonial and shall begoverned by this Code, without prejudice to the

provisions of special laws. Under this, all but 2of the properties would be patrimonialproperties of the former province. Under thelaw on Municipal Corporations, however, to be

considered public property, it is enough thatproperty be held and devoted for governmental

purposes. Using this, 26 of the lots arepatrimonial. (Province of Zamboanga del

Norte v. City of Zamboanga)

The 157.84 hectares of reclaimed lands

comprising the Freedom Islands, now coveredby the certificates of title in the name of PEA,

are alienable lands of the public domain. PEAmay lease these lands to private corporations

but may not sell or transfer ownership of theselands to private corporations. PEA may only sell

these lands to Philippine citizens, subject to theownership limitations in the 1987 Constitution

and existing laws.

The 592.15 hectares of submerged areas of

Manila Bay remain inalienable natural resourcesof the public domain until classified as alienableor disposable land open to disposition and

declared no longer needed for public service.The government can make such classification

and declaration only after PEA has reclaimedthese submerged areas. Only then can these

lands qualify as agricultural lands of the publicdomain, which are the only natural resources

the government can alienate. In their present


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state, the 592.15 hectares of submerged areasare inalienable and outside the commerce of

man. (Chavez v. PEA)

OWNERSHIP

Independent and general right of a person tocontrol a thing particularly in his possession,

enjoyment, disposition, and recovery, subjectto no restrictions except those imposed bythe state or private persons, without

prejudice to the provisions of the law.

Power of a person over a thing for purposes

recognized by law & within the limitsestablished by law

Attributes of Ownership

(1)Jus possidendi- right to possess

(2)Jus Utendi(right to use)right to enjoy

by receiving the thing that it produces.(3)Jus abutendiright to enjoy byconsuming the thing by its use

(4)Jus Disponendithe right to dispose orthe power of the owner to alienate,encumber, transform, and even destroy the

thing owned.- Includes right no to dispose

- This right is reserved exclusively to theowner

- This right can be partial if it can bedivided. It can also be temporary as in thecase of lease or pledge.

(4) Jus Fruendi right to receive fruits

(5) Jus Vindicandiright to exclude fromthe possession of the thing owned by anyother person to whom the ownership has

not transmitted such thing, by the properaction for restitution, with the fruits,

accessions, and indemnification fordamages.

Actions for possession:

1. movable replevin (return of a movable)2. immovable

a) forcible entry used by persondeprived of possession through Force,

Intimidation, Strategy, Threat orStealth (FISTS)

b) unlawful detainer used by

lessor/person having legal right overproperty when lessee/person

withholding property refuses tosurrender possession of property after

expiration of lease/right to holdproperty (physical possession, 1 year

from the last date of demand to vacatethe premises)

c) accion publiciana plenary action torecover possession when owner is

dispossessed by any other means than

the grounds for instituting a ForcibleEntry and Unlawful Detainer case.

d) accion reinvindicatoria recovery ofdominion of property as owner; main

issue is ownership not merelypossession.

e) Writ of Possession -- the original

registered owner in the Torrens

System, is entitled to a writ ofpossession not only against the partieswho appear and answer in the land

registration proceedings, but alsoagainst all those who, having been

served with process, do not appear oranswer.

f) Writ of injunction

Not a proper remedy for therecovery of possession UNLESS plaintiff

is admittedly the owner of the propertyand is in possession of it.

May be used to prevent or restrain

acts of trespass or illegal interferenceby others of his possession of theproperty.

In actions of FE, the plaintiff within10 days from the filing of the

complaint, may file a motion for a Writof Preliminary Mandatory Injunction to

restore him in possession (mandatory)and prevent further acts of

dispossession (injunction).

(6) Right to Exclude: Doctrine of Self-HelpDoctrine of self-help authorizes the lawful

possessor to use reasonable force to prevent a

threatened unlawful invasion or usurpation ofthe property.Elements:

a) Person exercising rights isowner or lawful possessor

b) There is actual or threatenedunlawful physical invasion of hisproperty (not available to squatters)

c) Use force as may bereasonably necessary to repel or

prevent it-Available only when possession has

not yet been lost, if already lost resort to judicial process

-May be exercised by 3rd

person negotiorum gestio

(7) Right to Enclose or Fence without detriment

to servitudes constituted thereon.

A person cannot enclose his tenement

and construct a fish pond that will obstructthe natural flow of waters from the upper

tenements to the injury of the owners ofsuch tenements. (Lunod v. Meneses)

(8) Right to Receive Just Compensation in case

of Expropriation

(9) Right to Space and Subsoil The right of the owner extends to the space

and subsoil as far as necessary for his


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practical interests or to the point where it ispossible to assert his dominion and there is

the possibility of obtaining some enjoymentor benefit. Beyond these limits, he would

have no legal interests.

(10) Right to Hidden Treasure (if found on his

property)a) hidden and unknown movables consist

of money or precious objects

b) owner is unknownc) If treasure is found by a stranger by

chance belongs to finder; the findermust not be trespasserbe entitled to a share.

Discovery by chance

When there is no purpose or intent to lookfor the treasure.

(12) Right to accession

Notes Requisites in an action to recover(a) Identity of the property

(b) Strength of plaintiffs title/ Better Title

Plaintiff must depend on the strength ofhis own title and not on the weakness

of the title of the other.

One year after a decree of registrationunder the Torrens System, the title

becomes perfect and indefeasible.

Ownership and title to land duly

recorded cannot be overcome bygratuitous titles such as inheritance or

donation or mere tax declarations.

Tax declarations are strong evidence ofownership where accompanied bypossession for period sufficient forprescription.

Titles from the Spanish government

have been held sufficient basis to proveownership.

Composition titlesproof of exclusive

ownershipPossessory information titleonly

prima facie evidence andrebuttable.

Cases

Art. 433 of the NCC provides: Actualpossession under claim of ownership raises a

disputable presumption of ownership. The trueowner must resort to judicial process for

recovery of the property. Under Art. 538 NCC,the present possessor is to be preferred in

cases where there are conflicting claims. Sincedefendants are presently in possession of the

property, they enjoy the presumption ofownership in their favor which has not been

successfully rebutted by evidence. (Perez v.Mendoza)

Ownership, which had been judicially confirmed

by the CFI in a proceeding in rem could not bedefeated by the claim of the adverse party

based on a mere unnotarized affidavit. The

Original Certificate of Titles has becomeindefeasible and incontrovertible. As to the

unnotarized affidavit, it failed to identify theproperties involved; it is not a sufficient basis or

support for the alleged partition. (Dizon v. CA)

Limitation of Real Right of Ownership

(1) For the benefit of the state and for publicinterest (Police power, eminent domain,taxation)

(i) Expropriation

for public use(ii) Military

requisitions(iii) Zonification

laws(iv) Public or

government monopolies(v) Law on water

and mines(vi) Public health

and safety(vii) Public

easements

(2) Legal servitudes and Voluntary Servitudes

(3) Limitations imposed by party transmittingproperty

(i) Either by contract or last will ordonations

(ii) Stipulation on inalienability

(4) True Owner Must Resort to Judicial Process(5) Sic Utere Tuo Ut Alienum Non Laedasit is

unlawful to exercise the right of ownership in

such a manner as to have no other effectthan to injure a third person without benefitto the owner.

(a) Act in State of Necessity

The law permits the injury ordestruction of things belonging to

others provided this is necessary toavert a greater danger or dangers.

Different from concept of self-help; thepurpose is to protect the actor himself

or another person at the expense of theowner of the property who has no partin the state of necessity.

(b) Liability of Proprietors under Article2191, NCC

(c) Fortified places or Fortresses- mustcomply with conditions under special

laws and regulations(d) Easement of Aqueduct- must observe

proper distances and prevent damageto neighboring tenements

(e) Planting of Trees(f) Easement of light and view

(g) Easement of right of way(h) Easement of Passage of Water from

Upper to Lower Tenements(i) Easement of Drainage

(j) Easement of aqueduct(k) Lateral and Sub-adjacent Support


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ACCESSION

The right by virtue of which the owner of athing becomes the owner of everything that

it may produce or which may beinseparably united or incorporated thereto,

either naturally or artificially. Based on principles of justice, necessity and

utility

General Principles of Accession

(1) Accessory follows the principal (accesiocedit principal)

(2) No unjust enrichment (Art. 443)(3) All works, sowing, and planting are

presumed made by the owner and at hisexpense, unless the contrary is proved (Art.

446)(4) Accessory incorporated to principal

such that it cannot be separated

without injury to work constructed ordestruction to plantings orconstruction of works.

(5) Bad faith involves liability for damages andother dire consequences

(6) Bad faith of one party neutralizes bad faithof the other (Art. 453).

(7) Ownership of fruits belong to the principalthing; Exceptions:(i) possession in good faith possessor is

entitled to fruits(ii) in usufruct usufructuary is entitled to

fruits(iii) in lease lessee is entitled to fruits(iv) in antichresis antichretic creditor is

entitled to fruits

Kinds of Accession

(1) Accession discreta the right pertainingto the owner of a thing over everything

produced thereby:

(a) Natural fruits, or spontaneous products

of the soil, and the young and otherproducts of animals (Art. 442)

(b) Industrial fruits, or those produced bylands of any kinds through cultivation

or labor (Art. 442)(c) Civil fruits, or rents of buildings, the

price of leases of and other propertyand the amount of perpetual or life

annuities or other similar income (Art.442)

A dividend, whether in the form of cashor stock, is income or fruit andconsequently should go to the

usufructuary, rather than the owner ofthe shares of stock in usufruct.

Dividend is declared only out of the

profits of a corporation and not out ofits capital. (Bachrach vs. Seifert).

A bonus paid by the mortgage-debtorto another who had mortgaged his land

to secure the payment of the debtorsobligation to a bank is not a civil fruit ofthe mortgaged property. It is not

income delivered from the property buta compensation granted for the risk

assumed by the owner of the property.(Bachrach vs. Talisay-Silay)

(2)Accession Continua the right pertainingto the owner of a thing over everything that

is incorporated or attached thereto, eithernaturally or artificially.

(a) With regard to immovable property(a.1) Accession industrial (BPS)

(i) Building,

(ii) Planting, or

(iii) Sowing (Arts. 445-455)

(a.2) Accession natural (FACA)

(i) Alluvium

(ii) Avulsion(iii) Change in the course of river(iv) Formation of islands

(b) With regard to movable property (ACS)(b.1) Adjunction or conjunction

(i) inclusio or engraftment

(ii) soldadura or attachment

(a) ferruminatio objects are ofthe same metal

(b)plumbatura objects arediff. metals

(iii) tejido or weaving

(iv)pintura or painting

(v) escritura or writing

(b.2) Commixtion or confusion

(b.3) Specification

Notes:

Accession Industrial

Art. 446 establishes 2 disputablepresumptions regarding BPS:

(a) The works etc. were made by the

owner(b) They were made at the owners

expenseException: When contrary is proven

Right of owner of materials (OM)

1. Right to be indemnified or paid

of value of property by owner of land2. Right to remove materials if he

can do so w/o injury to workconstructed if owner has not paid


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3. Right to damages anddemolition even if with injury to work if

owner of land is in bad faith

1st Case:

Landowner (LO) is BPS using materials of

another

Good Faith

OMlies in ignorance of BPS acts

BPS/LObelief that the materials belong to

him and who is not aware that thereexists in his title or mode of acquisition

any flaw which invalidates it

Note: his negligence may subject himto liability for damages

Bad Faith

OMallowing the use of the materialswithout protest

BPS/LOknowledge of lack of title and theabsence of permission of the owner of

the material to pay their value

Landowner andBPS

Owner of Material

Good faith

1. Right to acquirethe improvements

after paying thevalue of materials

Bad faith

1. Acquire BPS afterpaying its value and

paying indemnity fordamages (Art. 447)

but subject to OMsright to remove

Good faith

1. Right to acquire

the improvementswithout payingindemnity

Good faith

1. Limited right ofremoval if there would

be no injury to workconstructed, or without

plantings orconstructions being

destroyed (Art. 447)

2. Right to receivepayment for value ofmaterials

Good faith

1. Right to receivepayment for value ofmaterials

2. Absolute right of

removal of the workconstructed in any

event

Right to be indemnified

for damages

Bad faith

1. Lose materialswithout right toindemnity

2. Right to acquireindemnity for

damages if there arehidden defects

known to OM

Bad faith

(Same as though

acted in good faithunder Art. 453)

Bad faith

(Same as though acted

in good faith underArt. 453)

2ND Case:

BPS builds, plants, or sows on anothersland using his own materials

Good faithOM/BPSlies in belief that the land belongs

to him, and his ignorance of any defect orflaw in his title.

LOignorance of the BPS acts, or beliefthat the BPS has the right to construct,

plant or sow

Bad faithOM/BPSlies in his knowledge of his lack of

title and absence of permission of the LO

LOknowledge of BPS lack of right to

construct, plant or sow

(1) Option is given to Landowner

(2) Right of LO to remove or demolish

improvement

LO cannot refuse to exercise his right of

choice and compel the BPS to remove ordemolish the improvement. He is entitled to

such removal only when after havingchosen to sell his land, the other party fails

to pay for the same.

(3) Right of LO to require payment for value ofthe land

The purpose of the exception (if the valueof land is considerably more than that of

the building or trees) is to preventinjustice. It is considered inequitable in

such case to compel the BP to pay for theprice of the land.

A forced lease is created b/w the partiesif the LO does not choose to appropriate

the improvement after the properindemnity.

As to when the lands value is considerably

more than that of the improvement willhave to be determined by the court taking


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into consideration the circumstances ofeach particular case.

(5) Cases not covered

Art. 448 does not apply which are governed

by other provisions of law:

(a) co-ownership(b) usufruct

(c) agency(d) lease

Where there is a contractual relationexisting between the LO and the BPS, their

stipulations govern.

Landowner BPS and Owner of

Material

Good faith

LO has option to:

a)Acquire the

improvement afterpaying indemnity

which may be the:- original cost

ofimprovement

or- increase in

value of thewhole brought

about by the

improvementb)Sell the land to theBP pr collect rentfrom sower unless:

- value of landis more thanthe thing

built, plantedor sown

- BP shall payrent fixed by

parties or bythe court in

case ofdisagreement

Note: LO can be forcedto choose under pain

of direct contempt orcourt can choose for

him

Good faith

1. LO has right tocollect damages in any

case and option to:

a) Acquireimprovements withoutpaying indemnity if the

Good faith

BPS has right to retainthe land until the

payment of indemnity(right of retention)

Note: During thisperiod BPS is not

required to pay rent

improvements are stillstanding on the land

b) Sell the land to BPor collect rent from

the sower unless thevalue of the

improvements inwhich case there will

be a forced lease

c) Order demolition ofimprovements or

restoration of land toits former condition atthe BPS expense.

2. LO must pay fornecessary expenses

for preservation.

Bad faith

1. LO must indemnifyBPS for the

improvements and paydamages as if he

himself did the BPS

2. LO has no option to

sell the land andcaanot compel BPS tobuy the land unlessBPS agrees to

Bad faith

(Same as though


Bad faith

1. Pay damages to LO

2. BPS lose materials

without right to

indemnity

3. No right to refuseto buy the land

4. Recover necessary

expenses forpreservation of land.

Good faith

BPS has right to:

a) be indemnified fordamages

b) remove allimprovements in any

event

Bad faith

(Same as though


3rd Case:

BPS builds. Plants, or sows on anothers

land with materials owned by third person


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(1) Liability of LO

He shall be subsidiarily liable for the valueof the materials if the following requisitesare present:

(a) The OM has not acted in bad faith(b) The BPS has no property with which to

pay; and(c) LO appropriates the accession to

himself

(2) Right of BPS who pays OM

If BPS pays the OM, the former may seekreimbursement from the LO for the value ofthe materials and labor to prevent unjust

enrichment of the LO at the expense of theBPS. This is true if:

(a) The BPS acted in good faith; and(b) The LO appropriates the improvement

Landowner BPS OM

Good faith

1. Right to

acquireimprovementsand pay

indemnity toBPS;subsidiarily

liable to OM

2. Has option

to:

a) Sell land toBP except ifthe value of

the land isconsiderably

more

b) Rent to

sower

Good faith

1. Right toacquire

improvementsand payindemnity to

BPS

2. Has option

to:

a) Sell land to

BP except ifthe value of

the land isconsiderably

more

b) Rent tosower

Good faith

1. Right of

retention untilnecessaryand useful

expenses arepaid

2. Pay value

of materialsto OM

Good faith

1. Right ofretention until

necessaryand useful

expenses arepaid

2. Keep BPSwithoutindemnity toOM and

collectdamages

from him.

Good faith

1. Collect

value ofmaterialsprimarily from

BPS andsubsidiarilyliable for LO if

BPS insolvent

2. Limited

right of

removal

Bad faith

1. Lose the

materialswithout right

to indemnity

2. Must pay

for damages toBPS

3. Withoutsubsidiary

liability forcost of

materials

Good faith

1. LO has

right tocollect

damages inany case and

option to:

a) Acquire

improvementsw/o paying

for indemnity;or

b) Demolitionorrestoration;or

c) Sell to BP,or to rent to

sower

2. Pay

necessaryexpense to

BPS

Bad faith(Same as

when allacted in good

faith underArt. 453)

Bad faith

1. Acquireimprovement

after payingindemnity and

damages toBPS unless

latter decidesto remove

improvements

2. Subsidiarily

liable to OMfor value of

materials

Bad faith

1. Acquire

improvementsafterindemnity;

Bad faith

1. Recover

necessaryexpenses for

preservation

of land fromLO unless LO

sells land

Bad faith

(Same aswhen allacted in good

faith under

Art. 453)

Good faith

1. Mayremoveimprovements

2. Be

indemnifiedfor damages

in any event

Bad faith

1. Recovervalue from

BPS (as if bothare in good

faith)

2. If BPS

acquiresimprovement,

removematerials if

feasible w/oinjury

3. No action

against LO butliable to LO for

damages

Bad faith

(Same as

when all actedin good faith

under Art 453)

Good faith

1. Remove

materials ifpossible w/o

injury

2. Collect

value ofmaterials from

BPS;subsidiarily

from LO


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subsidirailyliable to OM

for value ofmaterials

2. Has optionto:

a) Sell theland to BP

except if thevalue of theland is

considerablymore

b) Rent to

sower

Good faith

1. Acquire

improvementafter paying

indemnity;subsidiarily

liable to OM

2. LO has

option to:

a) Sell land to

BP except ifvalue of landisconsiderably

more

b) Rent to

sower

Bad faith

1. Acquire

improvementsand pay

indemnity anddamages to

BPS unlesslatter decides

to remove

materials

Bad faith

1. Right ofretention untilnecessary

expenses arepaid

2. Pay value

of materialsto OM and

pay himdamages

Bad faith

1. Right ofretention until

necessaryexpenses are

paid

2. Pay value

of materialsto OM

3. Paydamages to

OM

Good faith

1. Receiveindemnity for

damages

2. Absoluteright ofremoval of

Good faith

1. Collectvalue of

materialsprimarily fromBPS and

subsidiarilyfrom LO

2. Collect

damages fromBPS

3. If BPSacquires

improvements,remove

materials inany event

Good faith

1. Collectvalue of

materialsprimarily from

BPS and

subsidiarilyfrom LO

2. Collect

damages fromBPS

3. If BPSacquiresimprovements,

absolute rightof removal inany event

Bad faith

1. No right toindemnity

2. Loses rightto material

improvementsin any event

Cases:

When, in the face of a conflict between the

rights of an owner and a builder, sower, planterin good faith, the owner opts to sell the land tothe BPS who is subsequently unable to pay, the

BPS loses his right of retention. A forced co-ownership occurs when the BPS has acted in

good faith . It is the owner of the land who isallowed to exercise the option because his right

is older and because, by the principle ofaccession, he is entitled to the ownership of the

accessory thing. When the BPS failed to pay forthe land, he lost his right of retention.(Bernardo vs. Baticlan)

Since the option to remove or demolish

improvement is given to the LO and it is limited

to paying for the improvement or selling hisland to the BPS, he cannot refuse to exercisehis right of choice and compel the builder to

remove or demolish the improvement. He isentitled to such removal only when afterchoosing to sell his land, the other party fails to

pay for the same. (Ignacio vs Hilario)

The owner of a building erected in good faith ona land owned by another is entitled to retain

possession of the land until he is paid the valueof the building. An order by a court compelling a

builder in good faith to remove is building fromland belonging to another who chooses neither

to pay for such building nor sell the land is nulland void for being offensive to Art. 448.(Sarmiento v. Agana)

In Depra vs Dumlao, the SC laid down the

guidelines for enforcement of rights under Art.448 and 546

1. TC must determine the fair price of the land,expenses for improvement and increase in

value of land due to improvements.

2. TC must grant period where:

a) landowner must exercise option

b) parties must pay in accord with the option

chosen

c) builder can refuse to offer to sell if value of

land is greater than the value of improvements

d) if the situation is that of (c), the parties can

agree upon the terms of the lease. If there areno agreements, the TC must fix the terms.

While a possessor in good faith may retain the

property until he is reimbursed for necessaryand useful expenses, all the fruits he receives

from the moment his good faith ceases must bedeferred or paid by him to the LO. He may,

however, secure the reimbursement of hisexpenses by using the fruits to pay it off

(deduct the value of the fruits he receives from


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the time his good faith ceases from thereimbursement due him). (Ortiz vs Kayanan)

A BPS in good faith does not lose its rights

under Art. 448 merely because of the fact thatsome years after acquiring the property in good

faith, it learned about and aptly recognized theright of the LO to a portion of the land occupied

by the building. The supervening awarenessdoes not prejudice its right to claim the status

of a builder in good faith. (Tecnogas Phil.Manufacturing Corp. vs CA)

The BPS in good faith should not pay rentals to

the LO spouses. The spouses, having opted toappropriate the improvement on the lot, have

to reimburse the BPS of the cost of constructionof the building (in accordance with Art 546).

The BPS has the right to retain theimprovements until he is reimbursed. An

implied tenancy or possession in fact is createdpending the payment of the corresponding

indemnity. (Pecson v CA)

Good faith consists in the belief of the builderthat the land he is building on is his and he is

ignorant of any defect or flaw in his title. Andas good faith is presumed, the LO has the

burden of proving bad faith on the part of theBPS. (Pleasantville Devt. Corp. v CA)

Art 448 applies only in cases where a person

constructs a building on the land of anotherin

good or bad faith, as the case may be. It doesnot apply to a case where a person constructs a

building on his own land (like in this case), forthen there can be no question as to good or badfaith of the builder. (Coleongco v Regalado)

The rule of Art. 453 of the Civil Code invoked bythe BPS can not be applied to the instant case

for the reason that the improvements inquestion were made on the premises only after

the LO had tried to recover the land in questionfrom him, and even during the pendency of this

action in the court below. After the BPS hadrefused to restore the land to the LO, to the

extent that the latter even had to resort to thepresent action to recover his property, the BPS

could no longer be regarded as having impliedlyassented or conformed to the improvements

thereafter made by appellant on the premises.(Felices v. Iriola)

ACCESSION NATURAL

(2) Accession natural may be in theform of either:

(i) Alluvium the accretion which landsadjoining the banks or rivers, lakes, creeks

or torrents gradually receive from the

Requisites of alluvium:

(a) The accretion must be gradual

(b) The cause of the accretion must be thecurrent of the water

(c) The land where the accretion takes

place must be adjacent to the banks ofthe rivers

(d) Alluvium must be natural

*riparian owner owner of the land frontingsuch riverbanks

The alluvium, by mandate of Art. 457, isautomatically owned by the riparian owner from

the moment the soil deposit can be seen but isnot automatically registered property, hence,

subject to acquisition through prescription by 3rd

persons. (Grande vs CA)

(ii) Avulsion the accretion which takesplace whenever the current of a river,lake, creek or torrent segregates froman estate on its bank a known portion

of land and transfers it to anotherestate (Art. 459)

Distinguished from Alluvium

Alluvium Avulsion

1. Deposit of soil is

gradual

2. Deposit of the soil

belongs to the ownerof the property where

the same wasdeposited

3. The soil cannot be

identified

1. Deposit of soil is

sudden or abrupt

2. The owner of the

property from which apart was detached

retains the ownershipthereof (2 yrs)

3. The detachedportion can be

identified

Requisites of Avulsion

(a) The segregation and transfer must be

caused by the current of a river, creekor torrent.

(b) The segregation and transfermust be sudden or abrupt

(c) The portion of land transported mustbe known and identifiable

Rights of the riparian owner

Removal within 2 years The former owner preserves his ownership

of the segregated portion provided he


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removes (not merely claims) the samewithin the period of 2 yrs.

Art. 460 applies only to uprooted trees. If aknown portion of land with trees standingthereon is carried away by the current to

another land, Art. 459 governs.

(iii) Change of river beds

that which takes place when a river bedis abandoned through the natural

change in the course of the waters (Art.461)

Requisites for the application of Art. 461:

(a) There must be a change in the naturalcourse of the waters of the river.

(b) The change must be abrupt or sudden.

Right of owner of land occupied by newriver course

1. Right to old bed ipso facto inproportion to area lost

2. Owner of adjoining land to old bedshall have right to acquire the same by

paying its value value not to exceedthe value of area occupied by new bed

3. Formation of island in non-navigable river

a) owner of margin nearest toislands formed if nearest to it

b) owner of both margins if island is in the middle (divided into

halves longitudinally)

(iv)Formation of islands either on theseas within the jurisdiction of the

Philippines.

On lakes, and on navigable or floatable

rivers (Art. 464) or non-navigable and non-floatable rivers (Art. 465).

(1) Ownership of islands formed through

alluvion

(a) If formed:

(a.1) on the seas within Phil. jurisdiction

(a.2) on lakes, and

(a.3) on navigable or floatable waters, theisland belongs to the State

(b) If formed in non-navigable and non-floatable rivers:

(b.1) it belongs to the nearest riparian

owner or owner of the margin or banknearest to it as he is considered in the

best position to cultivate and developthe island

(b.2) it is divided longitudinally in halves, ifit is in the middle of the river

(c) Concept of navigable river

A navigable river is one which forms inits ordinary condition by itself or by

uniting with other waters a continuoushighway over with other waters a

continuous highway over whichcommerce is or may be carried on.

Test: A river is navigable if it is used orsusceptible of being used, in its ordinary

condition, as a highway of commerce, that is,for trade and travel in the usual and ordinary

modes.

Accession Continua-Movable property:

(1) Adjunction or Conjunction that whichtakes place whenever movable thingsbelonging to different owners are united in

such a way that they cannot be separatedwithout injury, thereby forming a singleobject (Art. 466)

Kinds of adjunction:

(a) inclusio or engraftment

(b) soldadura or attachment

ferruminatio objects are of the same

metal

plumbatura objects are diff. metals

(c) tejido or weaving

(d) pintura or painting

(e) escritura or writing

Ownership of new object formed byadjunction

(a) If the union took place without bad

faith, the owner of the principal thingacquires the accessory, with theobligation to indemnify the former

owner of the accessory for its value inits uncontroverted state.

(b) If the union took place in bad faith, Art.470 applies.

TEST to determine principal in adjunction:

In order of application, the principal is that:(a) To which the other (accessory) has

seen united as an ornament or for its

use or perfection (Art. 467)- INTENT


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(b) Of greater value, if they are unequalvalues-VALUE

(c) Of greater volume, if they are of anequal value (Art. 468)-VOLUME

(d)That of greater merits taking intoconsideration all the pertinent legal

provision applicable as well as thecomparative, merits, utility and volume

of their respective things.

Where adjunction involves 3 or morethings

Art. 466 should be applied in an equitable

manner. The principal should bedetermined and distinguished from theothers which would be considered the

accessories.

Rights:

1. If both are in good faith owner of principal acquired the

accessory with indemnification

2. If both are in good faith mayseparate them if no injury will be

caused;if value of accessory is greater than

principal, owner of accessory maydemand separation even if damageswill be caused to the principal

(expenses to be borne by one whocaused the conjunction)

3. If owner of accessory is in badfaith owner of accessory withdamages to principal

4. If owner of principal is inbad faith owner of accessory shallhave option of principal paying value of

accessory or removal of accessorydespite destruction of principal

5. Owner of accessory orprincipal has right to indemnity whenthing adjuncts w/o his consent may

demand that a thing equal is kind,value and price

(2) Specification that which takes place

whenever a person imparts a new form tomaterials belonging to another person (Art.

474).

Rights

1. If person who made thetransformation is in good faith - he

shall appropriate the thing transformedas his own with indemnity to owner of

material for its value

2. If material is more preciousthan transformed thing owner ofmaterial may appropriate the new thing

to himself after indemnity paid to laboror demand indemnity for materials

3. If person who made thetransformation is in bad faith, owner ofmaterial shall appropriate the work to

himself w/o paying maker or demandindemnity for value of materials &damages

4. If transformed thing is morevaluable than material, owner of

material cannot appropriate

(3) Commixtion or confusion that which takesplace whenever there is a mixture of things

solid or liquid belonging to different owners, themixture of solids being called commixtion, while

that of liquids, confusion (Art. 472).

Rights

1. If both owners are in good faith Eachowner shall acquire a right proportional

to the part belonging to him (vis-a-visthe value of the things mixed orconfused)

2. If one owner is in bad faith he shalllose the thing belonging to him plus

indemnity for damages caused toowner of other thing mixed with his

thing3. If both in bad faith no cause of action

against each other

QUIETING OF TITLE

An action to quiet title to property or toremove a cloud thereon is a remedy orform of proceeding originating in equity

jurisprudence, which has for its purpose anadjudication that a claim of title or an

interest in property, adverse to that ofcomplainant, is invalid, so that the

complainant and those claiming under himmay be forever free from any danger of the

hostile claim.

Requisites(1) There is a cloud on title to real property or

any interest to real property (Art. 476)(2) Plaintiff has legal or equitable title to or

interest in the subject/real property.(3) Instrument, record, claim,

encumbrance or proceeding must be valid andbinding on its face but in truth and in factinvalid, ineffective, voidable or unenforceable;

contract upon which defendant relies has beenextinguished or terminated, or has prescribed(4) Plaintiff must return benefits received

from the defendant.

Differences between action to quiet title,action to remove a cloud, and action to

prevent a cloud


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An action to quiet title, strictly considered,is substantially an action to put an end to

vexatious litigation in respect to theproperty involved.

An action to remove a cloud is intended toprocure the cancellation, delivery of,

release of an instrument, encumbrance, or

claim constituting a claim on plaintiffs title,and which may be used to injure or vexhim in the enjoyment of his title.

In an action to quiet title, the plaintiff

asserts his own estate and declares

generally that the defendant claims someestate in the land, without defining it,

and avers that the claim is withoutfoundation.

In a suit to remove a cloud, plaintiff not

only declares his own title, but also avers

the source and nature of defendantsclaim, points out its defect, and prays that

it be declared void. In an action to prevent a cloud, relief is

granted if the threatened or anticipatedcloud is one which if it existed, would be

removed by suit to quiet title.

Prescription of actionImprescriptible ifplaintiff is in possession; if not, prescribes

within period for filing accion publiciana,accion reivindicatoria.

Notes:

An action for reconveyance:a) Prescribes in 10 years if the plaintiff is

NOT in possession of the property andif the action for reconveyance is based

on an implied or constructive trust. Thepoint of reference is the date of

registration of the deed or the date ofthe issuance of the certificate of title

over the property.

b) Is IMPRESCRIPTIBLE if the personclaiming to be an owner is in actual

possession of the property. Here, theright to seek reconveyance in effect

seeks to quiet title. (Olviga v. CA)

It is not necessary that the vendee has anabsolute title. An equitable title is

sufficient to clothe him with personalityto bring an action to quiet title.(Pingol v. CA)

What plaintiff imagined as clouds cast on histitle were PRs alleged acts of physical

intrusion and not. an instrument, record,claim, encumbrance or proceeding which

constitutes or casts a cloud, doubt,question or shadow upon the owners

title or interest in real property. Clearly,

the acts alleged may be consideredgrounds for an action for forcible entrybut definitely not one for quieting of title.

(Titong v. CA)

RUINOUS BUILDINGS AND TREES INDANGER OF FALLING

Liability for damages:

1. collapse engineer, architector contractor2. collapse resulting from total or

partial damage; no repair made owner; state may compel him to

demolish or make necessary work toprevent if from falling3. if no action done by

government at expense of owner

CO-OWNERSHIP

CO-OWNERSHIPright to common dominion

which two or more persons have in a spiritualpart (or ideal portion) or a thing which is not

materially or physically divided.

Characteristics of Co-ownership

(1) plurality of owners, but only one real rightof ownership

(2) unity of material of the object of ownership

(3) recognition of ideal shares or aliquot(4) absolute control of each co-owner over his

ideal share, not over specific portions of theproperty

(5) There is a mutual respect among co-owners

in regard to the use, enjoyment, andpreservation of the property owned incommon.

Differences between co-ownership and

joint tenancy

Co-ownership Joint Ownership

Tenancy in Common,

Ownership inCommon, Co-dominium

Joint tenancy, Tenancy

in common, Notion ofall-for one, one-for-all

Civil law origin Common Law/ Anglo-

American origin

Each co-owner owner

of his ideal share

Each joint owner, the

surviving joint ownersare subrogated in his

rights by accretion

Each co-owner maydispose of hisundivided share

without the othersconsent.

Joint owner mustobtain the consent ofall the rest to dispose

of his share.


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In case there is a co-owner who is a minor,

minority as a defenseagainst prescription is

exclusive to him.

The defense of onejoint owner can be

used as a defense byall joint owners.

Differences between partnership and co-ownership

OrdinaryPartnership

Co-ownership

With legal/juridical

personality distinctfrom its members

No legal personality

distinct from itsmembers

Created only by

agreement or contractto that effect

created by LAW

FOCUS [Law,Fortuitous Event,

Occupancy, Contract,Succession]

Purpose is to obtainprofit

Purpose is collectiveenjoyment and to

maintain the unity andpreservation of thethings owned in

common.

No term set limit setby law

As a rule, anagreement to keep the

ownership for morethan 10 years is void.

Creditors of individualpartners cannot attach

and sell on executionthe shares of partners

in the partnership

Creditors of a co-owner can attach his

shares in the co-owners and sold on

execution

Can be extinguished

by the death orincapacity of one

party

Death or incapacity of

a co-owner does notaffect existence of a

co-ownership

There is mutual

representation of theparties

A special authority is

needed for suchrepresentation.

A partner cannottransfer his rights to a3rd person without theconsent of the others

A co-owner can freelydispose of his sharewithout need to askthe consent of the

other co-owners.

Distribution of profits

can be stipulated upon(profit-sharing)

Profits of a co-owner

depend on hisproportionate share;

profit-sharing isinvariable (Art. 485)

not subject tostipulation

Sources of co-ownership

(1) Law(a) Cohabitation

(i) Between man and womancapacitated to marry each other.

(Art 147, FC)(ii) Between man and woman not

capacitated to marry each other

(Art. 148, FC)

(b) Absolute community property (Art. 90,FC)

(c) two or more persons purchase propertyand by common consent legal title is

taken in the name of one of them forthe benefit of all, an implied trust is

created in favor of the others in

proportion to each to interest of each.(Art. 1452)

(d) Succession

(i) Intestate successionw here thereare two or more heirs, the whole

estate of the decedent is, before itspartition, owned in common by

such heirs, subject to the paymentof debt of the deceased (1078)

(ii) Testateif property is given to twoor more heirs by the testator

An instance is when a person Adies intestate and the properties are

left undivided to several heirs, suchheirs are co-owners of the inheritance.If one of the heirs dies, his heirs will in

turn be co-owners of the surviving heirsof A.

Redemption done by one of the co-owners/heirs will benefit his other co-

owner heirs despite the fact that theydid not contribute to the redemption

money.

(e) Donation

donation to several persons jointly, it is

understood to be in equal shares

no rights of accretion unless the donorotherwise provides

but if donation is made to husband and

wife jointly, there shall be a right ofaccretion, unless contrary so provide.

(f) Chance commixtion in good faith (Art.

472, NCC)(g) Hidden treasure co-ownership

between finder and owner(h) Easement of a party wall

(i) Occupation Harvesting and fishing

The ambergris caught by the hunters

was undivided common property of theplaintiffs and one of the defendants.This common ownership was acquired

by occupancy. The action for recoverypertaining to each co-owner, derived

from the right of ownership inherent inthe co-ownership can be exercised not

only against strangers, but against theco-owners themselves when the latter

performs with respect to the thing heldin common acts for their exclusivebenefit, or for exclusive ownership, or

which are prejudicial to, and in violationof the right of the community.

(Punsalan et al. v. Boon Liat et al.)


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(j) Condominium lawSec. 6(c) of RA 4726 unless otherwise

provided, common areas are held incommon by the holders of the units in equal

shares, one for each unit.

(2) Contract

(a) Two or more persons agree to create aco-ownershipmaximum of ten years(494, 2nd par), extendable by a new

agreement.Example: When two parties agree to

purchase a piece of land, each onepaying a part of the purchase price, onthe condition that they are to divide the

land equally between them. Partiesmay also become co-owners of aparticular business when no partnership

having a distinct juridical existence isformed between them.

(b) Universal Partnership(i) Of all present properties (Art.

1778-1779, NCC)

(ii) Of profits (Art. 1780, NCC)

(c) Associations and Societies, whosearticles are kept secret wherein anyone

of the members may contact in his ownname with third persons (no juridical

personality)

Rights of each co-owner as to the thingowned in common.

USE the COPs LP(1)Use thing;(2) Share benefits(3)Ejectment suit

(4)Compel to contribute(5)Object to alteration;

(6)Protect against prejudice(7)Exercise legal redemption;

(8)ask for partition]

(1) To use the thing according to itspurpose intended (may be altered by

agreement, express or implied; provided:(a) without injury or

prejudice to interest of co-ownership;and

(b) without preventingthe use of other co-owners (Art. 486)

Any act against the collective interest san act against ownership and the remedies

available to owners in general may by usedby the co-owners.

Each co-owner of realty held pro-indiviso

exercises his rights over the whole propertymay use and enjoy the same with no other

limitation than that he shall not injure theinterests of his co-owners, for the reason that,

until a division be made, the respective part ofeach holder can not be determined and every

one of the co-owners exercises together withhis other co-participants, joint ownership over

the pro- indiviso property, in addition to his use

and enjoyment of the same. (Pardell v.Bartolome)

(2) To share in the benefits in proportionto his interest, provided the charges

are borne by each in the same

proportion (Art. 485)

A contrary stipulation is void. Portions are

presumed equal unless contrary is proved.Accretion added to any portion of land co-

owned becomes part of the property in co-ownership and should be divided according toeach co-owners proportionate share.

(3) Any one of the co-owner may bring anaction in ejectment (Art. 487)

A co-owner ma bring such actionwithout necessity of bringin all the other co-

owners as co-plaintiffs because the suit is

deemed to be for the benefit of all. Action will not prosper if the action isfor the benefit of himself only and not for

the co-ownership.

When the action is brought by one co-owner for the benefit of all, a favorable

decision will benefit everyone but anadverse decision will not affect them if theyare not parties in the case or they did not

give their consent to the action.

(4) To compel other co-owner tocontribute to expenses for preservation

of the thing or right owned in commonand to taxes (Art. 488)

Co-owners option not to contribute bywaiving his undivided interest equal toamount of contribution (except if waiver is

prejudicial to co-ownership)

Necessary expenses

taxes and expenses for the

preservation of the thing which is not madewould endanger the existence of the thing

or reduce its value or productivity

Does not include those that merely

produce benefits for the owner, or merelyfor luxury, embellishment or pleasure.

Useful expenses

they increase the income of the thingowned in common for the benefit of all the

co-owners.

not covered as one of them cannot

incur such expenses without the consent ofthe others and then charge them to paytheir shares later.

(a) Remedy against defaulting co-owneraction to compel him to contribute such

share. He cannot be compelled torenounce his share as such option is at

his own discretion.


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Co-owner has option not to contributeby waiving his undivided interest equal to

amount of contribution (unless waiver isprejudicial to co-ownership)

Requisites before repairs forpreservation, embellishment, or

improvements may be made

a) if practicable, notice to co-ownersb) majority decision, as provided under

Article 492

A co-owner alone can advanceexpenses for preservation of the property

even without prior consent of others; he isentitled to be reimbursed for the amount he

spent for necessary expenses.

Will of one of the co-owners is sufficientauthority to undertake expenses for

preservation. He can proceed with therepairs for preservation despite oppositionof the others.

Consent of majority required only in

case where the expenses are for theimprovement or embellishment of the thingor for administration and better enjoyment

of the thing.

Consent of all is needed only in acts of

ownership.

Effect of failure to notify co-owners:(a) Failure to give notice even if it

was practicable to do so does not

deprive the co-owner his right to bereimbursed the proportionate share of

the other in the expenses.(b) The effect of such omission is

that he is given the burden of proving

the necessity of such repairs and thereasonableness of the expense.(c) He will not be fully reimbursed

if the others can prove that had he

notified them, they could have hiredthe services of another contractor whowould charge less than the people

whom he contracted or that they knowof a store that sells the needed material

at a cheaper price. The difference willbe borne by him.

(5) To oppose any act or alteration;

remedy of other co-owner in case ofalteration.

Alteration

The act by virtue of which a co-owner- changes the thing from the

state in which the others believe itshould remain or

- Withdraws it form the use to whichthey are desired to be intended in

opposition to the common agreement,if there is any, or in absence of acommon agreement, to the tacit

agreement of all the co-owners, andviolating their will

Acts of alteration requires the consentof ALL the co-owners if it changes the

essence or nature of the thing (present

article refers to this) because it is an act ofownership.

Consent of all is needed in order toimpose a voluntary easement on theproperty they co-own.

Acts of alteration that does not change

the essence or nature of the thing requires

only the agreement of the majority becauseit is merely an act of administration.- but if withholding of consent by any

one of the co-owners is clearlyprejudicial to the common interest,

courts may afford adequate relief (Art.491, CC)

Administration and better enjoyment

acts or decisions for the common benefit ofall and not for the benefit of only one or

some of them.

Characteristics:

(a) they refer to the enjoyment and

preservation of the thing(b) they have transitory effects

Acts ofAlteration/Acts of

Ownership

Acts ofAdministration

Relates to the

use, substance orform of the thing

Have a morepermanent result

Consent of allis necessary

Contrary to

the co-ownershipagreement

Also for the better

enjoyment of theproperty

Effects are oftransitory character

Consent of thefinancial majority

will be binding

Does not give riseto a real right overthe thing owned in

common.

Effects of acts of alteration and remedies

of non-consenting co-owner :(a) Co-owner who made alterations may

lose whatever he has spent as he willnot be reimbursed

(b) He may be ordered to demolish orremove the alteration at his expense

(c) He will be liable for damages and otherlosses

(d) Co-ownership will benefit from thealteration if other co-owners decide to

contribute to the expenses byreimbursing him (ratification)

(e) If a house is built in a common lot, theco-owners are entitled to the

proportionate share of the rent.

Q: Can a mere majority of the co-owners leasereal property for any length of time?

A: Old Civil Code rule:

Lease for not more than 6 years is just

an act of administration.

Lease for more than 6 years is an act of

ownership.New Civil Code rule:


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Lease becomes an act of ownershipand ceases to be an act of

administration if:(1) It is recorded in the Registry oProperty; and

(2) It is for more than 1 year

Registration makes the leasebinding on third persons (Art. 1648, NCC)Special powers is the criterion for

determining whether the act is legally oneof strict ownership.

(6) To protect against acts of majority

which are prejudicial to minority (Art.492, Par. 3)

Who may manage property?a) The co-owners themselves

Court cannot appoint an administrator tomanage a property co-owned when the co-

owners want to handle the management.

In this management, the majority of the ofinterest control and their decisions arebinding upon the minority. Majority may

only proceed to act without notice to theminority if the circumstances warranturgency.

b) An administrator who may or may not be aco-owner delegated by the co-owners

An administrator cannot, without theunanimous consent of all the co-owners,

compromise on, donate, cede, alienate,mortgage, or encumber in any manner the

common property.

The majority is not the majority in

number but rather pertains to the majority

in interest or the financial majority. Themajority required should be construed to be

an absolute majority or more than one-halfof the value of the thing.

When are acts seriously prejudicial?

So serious and affects the interestof the co-owners in the community

Such that willcause injuries enough to justify the

intervention of the court

Example:(1) When the resolution calls for a

substantial change or alteration

of the common property

or of the use to which it has

been dedicated by agreement or byits nature.

(2) When the resolution

goes beyond the limits of mereadministration, or

invades the proprietary rights of the co-

owners, in violation of Art. 491(prohibiting against acts of alteration)

(3) When the majority leases, loans, or othercontracts without security, exposing the

thing to serious danger to the prejudice ofthe other co-owners.

(4) When the majority refuse to dismiss anadministrator who is guilty of fraud or

negligence in his management, or does nothave the respectability, aptitude, and

solvency required of persons holding suchposition.

(5) When resolution, if carried out, would cause

serious injury to the thing itself, such as anagreement not to borrow money underreasonable terms when it is necessary for

urgent repairs for preservation, or for thepayment of taxes.

Remedies of the minorityIf the acts of the majority prejudice the

minority, the latter may ask for injunction or atworse, a partition.

(7) To exercise legal redemption (Art.

1620, 1623)

The right of redemption of co-ownersexcludes that of adjoining owners.

The period of redemption starts to runfrom the WRITTEN notification. However,

there is an exceptional case- when there isactual knowledge (Alonzo v. IAC)

Q: Can redemption money be made equal or

less than what was paid by third persons?A: Yes, it can be lower if the price of sale is

grossly excessive, such as when the co-owner didnt want other co-owners to

redeem. However, generally it is of theequal amount.

Cases:Redemption of the property by a co-owner doesnot vest in him sole ownership over said

property but will inure to the benefit of all co-owners. Redemption is not a mode of

termination of relationship. (Mariano v CA)

By the very nature of the right of "legalredemption", a co-owner's right to redeem is

invoked only after the shares of the other co-owners are sold to a third party or stranger to

the co-ownership. But in the case at bar, at thetime petitioners filed their complaint for

injunction and damages against privaterespondents, no sale of the latter's pro-indiviso

shares to a third party had yet been made.

The law does not prohibit a co-owner fromselling, alienating or mortgaging his ideal sharein the property held in common. The law merely

provides that the alienation or mortgage shallbe limited only to the portion of the propertywhich may be allotted to him upon termination

of the co-ownership and, as earlier discussed,that the remaining co-owners have the right to

redeem, within a specified period, the shareswhich may have been sold to the third party.

[Articles 1620 and 1623](Reyes vs. JudgeConcepcion)


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Halili has no right to invoke legal redemptionunder Art 1621 since such article presupposes

that the land sought to be redeemed is rural.Under Art. 1621, both landsthat sought to be

redeemed and the adjacent lot belonging to theperson exercising the right of redemptionmust

be rural. If one or both are urban, the right

cannot be invoked. (Halili v. CA)

Art. 1623 requires that the written notification

should come from the vendor or prospectivevendor, not from any other person. It is the

notification from the seller, which can removeall doubts as to the fact of the sale, itsperfection, and its validity, for in a contract of

sale, the seller is in the best position to confirmwhether consent to the essential obligation ofselling the property and transferring ownership

thereof to the vendee has been given.(Francisco v. Boiser)

The written notice of sale is mandatory for the

tolling of the 30-day redemption period.Notwithstanding actual knowledge of a co-owner, the latter is still entitled to a written

notice from the selling co-owner in order toremove all uncertainties about the sale, its

terms and conditions, as well as its efficacy andstatus. (Verdad v CA)

The validity of a title depends on the buyers

knowledge, actual or constructive, of a priorsale. While there is no direct proof that the

second vendees actually knew of the sale to thefirst vendees, they are deemed to have

constructive knowledge thereof by virtue oftheir relationship to the vendors.

A third person, within the meaning of Art. 1620

of the Civil Code (on the right of legalredemption of a co-owner) is anyone who is not

a co-owner. Art. 1623, requiring the vendor ofthe property to give a written notice of sale to

the other co-owners, had been rendered inutileby the fact that the first vendees took

possession of the property immediately afterthe execution of the deed of sale in their favor

and continue to possess the same. Since thefact of possession by the first vendees had not

been questioned by any of the co-owners, thelatter may be deemed to have knowledge of the

sale. (Pilapil v CA)

(8) Toask for partition (Art. 494)

A co-owner can always ask for a

partition. There is no prescriptive period.Exceptions:

(i) when there is a stipulation against it(not beyond 10 years)

(ii) when condition of indivision is imposed

by transferor (donor or testator) notexceed 20 years (Art. 494)

(iii) when legal nature of community

prevents partition (e.g. party wall)

(iv) when partition is generally prohibitedby law

(v) when partition would render the thingunserviceable, or the thing in common

is essentially indivisible- no physical partition but thing

maybe sold and co-owners shalldivide the proceeds (495, 498)

(vi) acquisitive prescription has set in facor

of a stranger to co-ownership or infavor of co-owner.

Either co-owner may demand the sale of thehouse and lot at any time and the other cannot

object to such demand. Thereafter the proceedsof the sale shall be divided equally according totheir respective interests. S, being a co-owner,

has the right use the house and lot withoutpaying any compensation to petitioner, as hemay use the property owned in common as long

as it is in accordance with the purpose for whichit is intended and in a manner not injurious to

the interest of the co-owners. (Aguilar v. CA)

Implications of co-owners right over his

ideal share

No individual or co-owner can claimtitle to any definite part or portion of

the thing co-owned.

All the co-owner has is an ideal

abstract, quota or proportionate sharein the entire land or thing.

All that he can sell or freely dispose ishis undivided interest but he cannot sell

or alienate a concrete, specific ordefinite part of the thing owned in

common because his right over thething is represented by a quota or ideal

portion without any physicaladjudication.

(1) Co-owner has the right

(a) To share in the fruits and benefits(b) To alienate, mortgage, or encumber

and dispose off his ideal share subjectto other co-owner right of legalredemption.

(c) To substitute another person in theenjoyment of the thing. (Art. 493)

(d) To renounce part of his interest to

reimburse necessary expenses incurredby another co-owner (Art. 488)

(2) Effect of transaction by each co-owner

(a) Limited to his share in the partition(b) Transferee does not acquire any

specific portion of the whole propertyuntil partition

(c) Creditors of co-owners may intervenein the partition to attack the same if

prejudicial (Art. 499), except thatcreditors cannot ask for rescission even

if not notified in the absence of fraud(Art. 497) ask for rescission even if

notified.

Cases:


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Unless the partition is effected, each heir cannotclaim ownership over the definite portion and

cannot dispose. Upon death of a person, eachof his heirs becomes the undivided owner of the

whole estate. He cannot alienate a specific partof the thing in common to the exclusion of other

co-owners because his right over the thing is

represented by an ideal portion. Co-ownercannot adjudicate to himself a definite portionowned in common until partition by agreement

or by judicial decree. Before partition, co-heircan only sell his successional rights. (Carvajal

v CA)

After his wifes death, the husband became

entitled to of the entire property, with only belonging to the heirs. They hold the propertyas co-owners. (Pamplona v Moreto)

Art 493 of the NCC allows the alienation of the

co-owner of his part in the co-ownership. The

effect of such alienation or mortgage shall belimited to the portion which may be allotted tohim in the division upon the termination of the

co-ownership In short, a co-owner can enterinto a contract of lease insofar as to his

interest. Therefore, he can also cancel suchlease without the consent from the other co-

owner. (Castro v. Atienza)

Difference of Co-ownership vs. ConjugalPartnership

Co-ownership ConjugalPartnership

May be

created by anordinary contract

Sex of co-

owners isimmaterial (kaya

kahit bading)

There may be

2 or more co-owners

Profits areproportional to

respectiveinterests

Death of a co-owner does not

dissolve the co-ownership

Generally co-owners administer

Co-ownershipis discouraged by

law

Created only by

reason of marriage Parties thereto are

on male and one

female

There are only 2conjugal owners

Profits are divided

equally, unlessthere is a contrary

stipulation in amarriage

settlement

Death of a spouse

dissolves the CPG

Encourage by law

for familysolidarity.

Special Rules on ownership of different

stories of a house as differentiatedfrom the provisions in the

Condominium Law (Act No. 4726)

Concept of condominium

Exclusive interest in units plusundivided interest in common areas.

Partly co-ownership, partly underindividual separate ownership

Each unit belongs separately to one ormore persons

The land and the common areas are of

common use by the different owners andare under co-ownership either ascontemplated by the Civil Code or through

a corporation.

Not governed by co-ownership as

provided for in the Civil Code.

External surfaces are common areas

Beams and posts are common areas

Easement, unless the master deed says

otherwise, is an exclusive easement.

Interest in the common areas will

depend on interest in the condo

Important documents in buying a condounit

(i) deed of sale(ii) enabling ormaster deed

(iii) declaration of restrictions

Sec. 9 The owner of a project shall, prior to theconveyance of any condominium therein,register a declaration of restrictions relating to

such project, which restrictions shall constitutea lien upon each condominium in the project

and shall insure to and bind all condominiumowners in the project. Such liens, unless

otherwise provided, may be enforced by any

condominium owner in the project or by themanagement body of such project. TheRegister of Deeds shall enter and annotate the

declaration of restrictions upon the certificate oftitle covering the land included within the

project, if the land is patented or register underthe land included within the project, if the land

is patented or registered under the LandRegistration or Cadastral Acts.

Method of taxation

Sec. 25. Whenever real property has been

divided into condominiums, each condominium

separately owned shall be separately assessed,for purposes of real property taxation and othertax purposes to the owners thereof and the taxon each such condominium shall constitute alien solely thereon.

Pzrtition of Common Areas

Sec.7. Except as provided in the following

section, the common areas shall remainundivided, and there shall be no judicialpartition thereof.

(a) Who manages the condominium?(i) condominium corporation

(preferred by law) co-terminouswith the existence of thecondominium


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(ii) co-ownership

(iii) association of owners

Rights and Obligations of Condominium

ownerWhat are the incidents of a condominium

grant?

(a) The boundary of the unit grant(i) the interior surfaces of the

perimeter walls, floors, ceilings,

windows, and doors(ii) those which are not part of the unit

bearing walls, columns, floors,roofs, foundations, and other

common structural elements of thebuilding; lobbies, stairways,hallways, and other areas ofcommon use, elevator equipment

and shafts, central heating, centralrefrigeration, and central air-

conditioning equipment, reservoirs,

tanks, pumps, and other centralservices and faicilities, pipes, ducts,flues, chutes, conduits, wires and

other utility installations, whereverlocated, except the outlets thereof

when located within the unit.(b) Exclusive easement for the use of the

air space encompassed by theboundaries of th unit

(i) as it exists at any particular time(ii) as the unit may lawfully be altered

or reconstructed from time to time(iii) such easement shall be

automatically terminated in any airspace upon destruction of the unitsto render it untenable

(c) Unless otherwise provided, the commonareas are held in common by theholders of units, in equal shares, one

for each unit(d) a non-exclusive easement for ingress,

egress, and support through thecommon areas are subject to such

easements(e) Each condominium unit owner shall

have the exclusive right to paint,repaint, tile, wax, paper, or otherwise

refinish and decorate the inner surfacesof the walls, ceilings, floors, windows,

and doors, bounding his own unit(f) Each condominium owner shall have

the exclusive right to mortgage,pledge, encumber his condominium and

to have the same appraisedindependently of the othercondominiums but any obligation

incurred by such condominium owner ispersonal to him.

(g) Each condominium owner has also the

absolute right to sell or dispose of hiscondominium unless the master deed

contains a requirement that theproperty be first offered to the

condominium owners within areasonable period of time before the

same is offered to outside parties.

Case

Section 5 of the Condominium Act expressly

provides that the shareholding in theCondominium Corporation will be conveyed only

in a proper case. Not every purchaser of a

condominium unit is a shareholder of thecondominium corporation. The CondominiumAct leaves to the Master Deed the

determination of when the shareholding will betransferred to the purchaser of a unit, as clearly

provided in the deed in this case. Ownership ofa unit, therefore, is a condition sine qua non tobeing a shareholder in the condominium

corporation By necessary implication, the"separate interest" in a condominium, whichentitles the holder to become automatically a

share holder in the condominium corporation,as provided in Section 2 of the Condominium

Act, can be no other than ownership of a unit.

The private respondents, consequently, whohave not fully paid the purchase price of theirunits and are not owners of their units nor

members or shareholders of the petitionercondominium corporation. (Sunset View

Condominium v Judge Campos)

Extinguishment of Co-Ownership

(1) Total destruction of the thing

(2) Merger of all the interest in one person(3) Acquisitive prescription

(a) By a third person(b) By one co-owner against the other co-

ownersRequisites:

(i) Unequivocal acts of repudiation ofthe rights of the other co-owners

(acts amounting to ouster of otherco-owners)

(ii) Open and adverse possession, notmere silent possession for the

required period of extraordinaryacquisitive prescription.

(iii) Presumption is that possession of aco-owner is not adverse.

(4) Partition or division

A division between two or morepersons of real or personal property which

they own as co-partners, joins tenants ortenants in common, effected by the setting

apart of such interests so that they mayenjoy and possess it in severallity.

(a) Right to ask for partition at any timeexcept:

(i) When there is a stipulation

against it. (must not be over 10 years)(ii) When condition of indivision is

imposed by transferor (donor or

testator) must not exceed 20 years

Art. 494


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(iii) When the legal nature of

community prevents partition. (e.g.,

party wall)(iv) When partition is generally

prohibited by law e.g. ACP(v) When partition would render

the thing unserviceable but the thing

may be sold and the co-owners dividethe proceeds (Art. 494)

Action for partitionwill fail if acquisitive prescription has set in.

(b) Effect of partition

Partition shall notprejudice third persons

who do not intervene in the partition

After partition, there should be mutualaccounting of benefits,reimbursements, payment of damages

due to negligence or fraud, liability for

defects of title and quality of portionassigned to each

Part allotted to a co-owner at partition

will be deemed to be possessed by suchco-owner from the time the co-

ownership commenced.

Heir is exclusive owner of property

adjudicated to him.

Co-owners reciprocally bound to eachother for warranty of title and quality ofpart given to each (hidden defect) after

partition.

Under Art. 1093, obligation of warranty

is proportionate to respective

hereditary shares; insolvency of onemakes the others liable subject toreimbursement (joint liability).

(c) Right of Creditors of individual Co-owners

Art. 497

All creditors, whether secured orprivileged, and those of any category

under title of alienation, exchange,donation, assignment, or otherobligation of a real or personal nature,

must be considered to intervene in thepartition of the common property.

They must have become creditorsduring the co-ownership

Co-owner debtors have the duty to

notify the creditors of the partition

Absence of notice makes partition not

binding on them.

They can contest such partition if they

formulate a formal opposition thereto.Assignee a transferee of a part of the

interest of the co-owner because if asale or assignment is total, the

assignee or the buyer should have beensubrogated in the place of the vendor

or assignor, who should be excludedfrom the co-ownership, and the

assignee or the buyer will intervene inhis own right in partition.

(d) Procedure for Partition (Rule 69, Rules

of Court)(1) Partition may be made:

(a) Orally

Valid and enforceableamong the parties.

Statute of frauds doesnot operate for partition is nota conveyance of property but

merely a segregation anddesignation of that part of the

property which belongs to theco-owners.

(b) In writing

Court will just confirm such

written agreement.

(2) Rules of Court does not precludeamicable settlement between

parties.

(3) Two principal issues in an actionfor partition:

(a) plaintiff is indeed a co-ownerof the property

(b) how the property is to bedivided between plaintiff and

defendants.

If property is found to be incapable

of being divided without greatprejudice to the interest of each

party, the court may order suchproperty be assigned to one co-

owner subject to the condition thathe will pay the other co-owners ofthe value of their interests as

deemed by the commissioners.

The sale may be made privately orpublicly and third persons may

become purchasers.

POSSESSION

Definition and Concept

(1) Possession is the holding of a thing ofthe enjoyment (exercise) of a right,

whether by material occupation (de factopossession) or by the fact that the thing orthe right is subjected to the action of our

will.(2) It is a real right independent of and

apart from ownership.

Essential requisites of possession

(1) Holding or control of a thing or right(corpus) consists of either:(a) the material or physical possession(b) subject action of our will- exercise of a

right(c) constructive possession


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doctrine of constructive possession

applies when the possession is under titlecalling for the whole, i.e., possession of apart is possession of the whole.

Constructive possessiona) tradicion brevi manu (one who possess

a thing short of title of owner lease );b) tradicion constitutum possesorium

(owner alienates thing but continues topossess depositary, pledgee, tenant)

(2) Intention to possess (animus possidendi)

it is a state of mind whereby thepossessor intends to exercise and does

exercise a right of possession, whether ornot such right is legal

intention may be inferred from the factthat the thing in question is under the

power and control of the possessor

may be rebutted by contrary evidence,

e.g., stolen property is placed in a mans

house without his knowledge.

Cases:The occupancy of apartof the land with aninstrument giving color of title is sufficient to

give title to the entire tract of land. Thegeneral rule is that the possession and

cultivation of a portion of a tract of land under aclaim of ownership of all is a constructive

possession of all, IF the remainder is not in theadverse possession of another. Possession in

the eyes of the law does not mean that a manhas to have his feet on every square meter of

ground before it can be said that he is in

possession. (Ramos v. Director of Lands)

The rule on constructive possession does not

apply when the major portion of the disputedproperty has been in the adverse possession of

homesteaders and their heirs. It is still part ofthe public domain until the patents are issued.

(Director v. CA)

Degrees of holding of possession

(1) Mere holding or possession wi

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