PNB V.

DE JESUS
411 SCRA 557

FACTS:
It would appear that on 10 June 1995, respondent filed a complaint against petitioner before the Regional
Trial Court of Occidental Mindoro for recovery of ownership and possession, with damages, over the questioned
property. In his complaint, respondent stated that he had acquired a parcel of land situated in Mamburao, Occidental
Mindoro, with an area of 1,144 square meters covered by TCT No. T-17197, and that on 26 March 1993, he had
caused a verification survey of the property and discovered that the northern portion of the lot was being encroached
upon by a building of petitioner to the extent of 124 square meters. Despite two letters of demand sent by
respondent, petitioner failed and refused to vacate the area.
Petitioner, in its answer, asserted that when it acquired the lot and the building sometime in 1981 from then
Mayor Bienvenido Ignacio, the encroachment already was in existence and to remedy the situation, Mayor Ignacio
offered to sell the area in question (which then also belonged to Ignacio) to petitioner at P100.00 per square meter
which offer the latter claimed to have accepted. The sale, however, did not materialize when, without the knowledge
and consent of petitioner, Mayor Ignacio later mortgaged the lot to the Development Bank of the Philippines. He also
contends that he is a builder in good faith.

ISSUE:
Whether or not being a builder in good faith matters under article 448.

HELD:
Article 448, of the Civil Code refers to a piece of land whose ownership is claimed by two or more parties,
one of whom has built some works (or sown or planted something) and not to a case where the owner of the land is
the builder, sower, or planter who then later loses ownership of the land by sale or otherwise for, elsewise stated,
where the true owner himself is the builder of works on his own land, the issue of good faith or bad faith is entirely
irrelevant.
Macasaet vs Macasaet G.R. 154391 92 September 30, 2004

Facts:
1. Petitioners Ismael and Teresita Macasaet and Respondents Vicente and Rosario
Macasaet are first-degree relatives. Ismael is the son of respondents, and Teresita is his
wife.
2. The parents alleged that they were the owners of two (2) parcels of land covered by
Transfer Certificate of Title (TCT) Nos. T-78521 and T-103141, situated in Banay-banay,
Lipa City; that by way of a verbal lease agreement, their son and his wife occupied these
lots in March 1992 and used them as their residence and the situs of their construction
business.
3. Ismael and Teresita denied the existence of any verbal lease agreement. They claimed
that their parents had invited them to construct their residence and business on the
subject lots. They added that it was the policy of their parents to allot the the land
owned as an advance grant of inheritance in favor of their children. Thus, they
contended that the lot covered by TCT no. T-103141 had been allotted to Ismael as
advance inheritance. On the other hand, the lot covered by TCT-78521 was allegedly
given to petitioners as payment for construction materials used in the renovation of
their parents house.
4. On December 10, 1997, the parents filed with the MTCC of Lipa City an ejectment suit
against their children for failure to pay the agreed rental despite repeated demands.
5. The MTCC ruled in favor of the parents and ordered the children to vacate the
premises. It opined that the children had occupied the lots, not by virtue of a verbal
lease agreement but by tolerance of the parents. As their stay was by mere tolerance,
the children were necessarily bound by an implied promise to vacate the lots upon
demand. The MTCC dismissed their contention that one lot had been allotted as an
advance inheritance, on the ground that succcesional rights were inchoate. It
disbelieved that the other parcel had been given as payment for construction material.
6. On appeal, the RTC upheld the findings of the MTCC. RTC allowed the parents to
appropriate the building and other improvements introduced by the children, after
payment by indemnity provided for bt Article 448 in relation to Article 546 and 548 of
the Civil Code.
7. On an appeal by both parties to the CA which were consolidated, the CA sustained the
finding of the lower courts that the children had been occupying the subject lots only by
the tolerance of their parent. Thus, possession of the subject lots by the children
became illegal upon their receipt of letter to vacate it. The CA modified the RTC Decision
by declaring that Article 448 of the Civil Code was inapplicable. The CA opined that
under Article 1678 of the same Code, the children had the right to be reimbursed for
one half of the value of the improvements made.
8. Not satisfied with the CAs ruling, the children brought the case to the Supreme Court.

Issues:
1. WON the children can be ejected

a. Based on the parents love reasons for gratuitously allowing the children to use the
lots, it can be safely concluded that the agreement subsisted as long as the parents
and the children benefitted from the arrangement. Effectively, there is a resolutory
condition existing between the parties occurs like a change of ownership,
necessity, death of either party or unresolved conflict or animosity the agreement
maybe deemed terminated. When persistent conflict and animosity overtook the
love and solidarity between the parents and the children, the purpose of the
agreement ceased. The children had any cause for continued possession of the lots.
Their right to use became untenable. It ceased upon their receipt of the notice to
vacate. And because they refused to heed the demand, ejectment was the proper
remedy against them.
b. The children had no right to retain possession. The right of the children to inherit
from their parents is merely inchoate and is vested only upon the latters demise.
Rights of succession are transmitted only from the moment of death of the
decedent. Assuming that there was an allotment of inheritance, ownership
nonetheless remained with the parents.
c. The childrens allegation that the indebtness of their parent to them has been paid
through dation cannot be given credence as there were no sufficient proof of a
settlement or contract of dation to settle the alleged debt, and is inconsistent of the
separate action by the children to recover the same debt.
d. As a rule, the right of ownership carries with it the right of possession.

2. Rights of a Builder in Good faith
a. As applied to the present case, accession refers to the right of owner to everything
that is incorporated or attached to the property. Accession industrial building,
planting and sowing on an immovable is governed by Articles 445 to 456 of the
Civil Code.
b. As the court found that the children possession of the two lots was not by mere
tolerance, the applicable rule would be Article 448. This article has been applied to
cases wherein a builder had constructed improvements with the consent of the
owner.