Case No.

10

TUMALAD vs. VICENCIO (G.R. NO. L-30173, September 30, 1971)

FACTS:

1. Sometime in 1955, Alberta Vicencio and Emiliano Simeon loaned 4,800 pesos from
Gavino and Generosa Tumalad. As guarantee, they executed a chattel mortgage over their
house in Quiapo which, at that time, was being rented from Madrigal and Company, Inc.

2. The mortgage was registered in the Registry of Deeds of Manila. It was also agreed that
default in the payment of any of the amortizations will make the unpaid balance
immediately due and demandable.

3. The defendants-appellants thus defaulted in paying and the mortgage was extrajudicially
foreclosed. The house was auctioned and bought by the Tumalads as the highest bidder.

4. They then commenced an ejectment case in the MTC which ruled in favor of Tumalad.
The defendants-appellants then appealed to the RTC questioning the legality of the
chattel mortgage.

5. While pending, the MTC issued a writ of execution but cannot be carried because the
house has already been demolished 10 days before pursuant to an order in another
ejectment case against the defendants.

6. The RTC ruled then in favor of Tumalad and ordered the defendants to pay the rent. This
was appealed to the CA which, in turn, certified the case to the SC as only questions of
law are involved.

7. Defendants-appellants contend that the chattel mortgage was void because the subject
matter is a house of strong materials and being an immovable, it can only be the subject
of a real estate mortgage and not a chattel mortgage.

ISSUE: Can defendants claim that the house is an immovable property?

RULING: No.

The parties to a contract may, by agreement, treat as personal property that which by nature
would be a real property if it was so expressly and specifically designated. This is based on the
principle of estoppel.

1. A mortgaged house on a rented land was held to be a personal property not only because
the deed of mortgage considered it as such but also because it did not form part of the
land.

2. It is now settled that an object placed on land by one who had only a temporary right to
the same does not become immobilized by attachment.

3. In the contract, the house was expressly designated as chattel mortgage which provides
that: the mortgagor voluntarily cedes, sells and transfers by way of chattel mortgage

4. Although there is no specific statement referring to the house as personal property, the
defendants-appellants could only have meant to convey the house as chattek or intended
to treat the same as such sk that they should not now be allowed to make an inconsistent
stand by claiming otherwise.

5. Moreover, the subject house stood on a rented lot to which defendants-appellants merely
had a temporary right as lessee, and although this cannot in itself alone determine the
status of the property, it does so when combined with other factors to sustain the
interpretation of the parties.

6. The SC, however, reversed the decision appealed from on the ground that the purchaser
of the house is not yet entitled, as a matter of right, to its possession as there is a 1-year
period within which the mortgagor may redeem the property.
 7. The period of redemption had not yet expired when action was instituted in the court of
origin. The original complaint stated no cause of action and was prematurely filed.

Case No. 22

Berkenkotter v. Cu Unjieng

Facts:

On 26 April 1926, the Mabalacat Sugar Company obtained from Cu Unjieng e Hijos, a loan
securedby a first mortgage constituted on 2 parcels of land "with all its buildings, improvements,
sugar-canemill, steel railway, telephone line, apparatus, utensils and whatever forms part or is a
necessarycomplement of said sugar-cane mill, steel railway, telephone line, now existing or that
may in thefuture exist in said lots.On 5 October 1926, the Mabalacat Sugar Company decided to
increase the capacity of its sugar central by buying additional machinery and equipment, so that
instead of milling 150 tons daily, itcould produce 250. Green proposed to the Berkenkotter, to
advance the necessary amount for thepurchase of said machinery and equipment, promising to
reimburse him as soon as he could obtainan additional loan from the mortgagees, Cu Unjieng e
Hijos, and that in case Green should fail toobtain an additional loan from Cu Unjieng e Hijos,
said machinery and equipment would becomesecurity therefore, said Green binding himself not
to mortgage nor encumber them to anybody untilBerkenkotter be fully reimbursed for the
corporation's indebtedness to him.Having agreed to said proposition made in a letter dated 5
October 1926, Berkenkotter, on 9 October 1926, delivered the sum of P1,710 to Green, the total
amount supplied by him to Green having beenP25,750. Furthermore, Berkenkotter had a credit
of P22,000 against said corporation for unpaidsalary. With the loan of P25,750 and said credit of
P22,000, the Mabalacat Sugar Co., Inc., purchasedthe additional machinery and equipment.On
10 June 1927, Green applied to Cu Unjieng e Hijos for an additional loan of P75,000 offering
assecurity the additional machinery and equipment acquired by said Green and installed in the
sugar central after the execution of the original mortgage deed, on 27 April 1927, together with
whatever additional equipment acquired with said loan. Green failed to obtain said loan. Hence,
abovementioned mortgage was in effect.

Issue:
Are the additional machines also considered mortgaged?

Held:
Article 1877 of the Civil Code provides that mortgage includes all natural accessions,
improvements,growing fruits, and rents not collected when the obligation falls due, and the
amount of anyindemnities paid or due the owner by the insurers of the mortgaged property or by
virtue of theexercise of the power of eminent domain, with the declarations, amplifications, and
limitationsestablished by law, whether the state continues in the possession of the person who
mortgaged it or whether it passes into the hands of a third person.It is a rule, that in a mortgage
of real estate, the improvements on the same are included; therefore, allobjects permanently
attached to a mortgaged building or land, although they may have been placedthere after the
mortgage was constituted, are also included.Article 334, paragraph 5, of the Civil Code gives the
character of real property to machinery, liquidcontainers, instruments or implements intended by
the owner of any building or land for use inconnection with any industry or trade being carried
on therein and which are expressly adapted tomeet the requirements of such trade or industry.
The installation of a machinery and equipment in amortgaged sugar central, in lieu of another of
less capacity, for the purpose of carrying out theindustrial functions of the latter and increasing
production, constitutes a permanent improvement onsaid sugar central and subjects said
machinery and equipment to the mortgage constituted thereon.
Case No 34

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Case No. 46

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Case No 58

G.R. No. 167232, July 31, 2009

DBT Mar-bay Construction, Inc.

vs Ricaredo Panes, etc.
Ponente: Nachura

Facts:

A parcel of land was conveyed by Regalado to DBT through a dacion en pago for services
rendered. On June 24, 1992, the respondents Panes and his sons filed a complaint for quieting of
title with damages and petition for injunction against Regalado and DBT.

In the complaint, Ricaredo alleged that he is the lawful owner of the land which he had declared
for taxation purposes in his name. Respondents alleged that per certificate issued by the DENR
the land was verified to be correct and on file.

Respondents also claimed the Ricaredo and his immediate family had been and still are in actual
possession of the subject property, and their possession preceded the 2nd world war. To perfect
his title, Ricaredo filed with the RTC QC.
Respondents averred that in the process of complying with the registration, it was found out that
a portion of the land was with the subdivision plan of Regalado which was conveyed by
Regalado to DBT.

On December 28, 1993, then defendants Spouses Jaime and Rosario Tabangcura (Spouses
Tabangcura) filed their Answer with Counterclaim, claiming that they were buyers in good faith
and for value when they bought a house and lot covered by TCT No. 211095 from B.C.
Regalado, the latter being a subdivision developer and registered owner thereof, on June 30,
1986. When respondent Abogado Mautin entered and occupied the property, Spouses Tabangcura
filed a case for Recovery of Property before the RTC, Quezon City, Branch 97 which rendered a
decision in their favor.

On its part, DBT, traversing the complaint, alleged that it is the legitimate owner and occupant of
the subject property pursuant to a dacion en pago executed by B.C. Regalado in the formers
favor; that respondents were not real parties-in-interests because Ricaredo was a mere claimant
whose rights over the property had yet to be determined by the RTC where he filed his
application for registration; that the other respondents did not allege matters or invoke rights
which would entitle them to the relief prayed for in their complaint; that the complaint was
premature; and that the action inflicted a chilling effect on the lot buyers of DBT.

RTC's Ruling:

The testimony of Ricaredo that he occupied the property since he was only 16 had not been
rebutted; Ricaredo's occupation and cultivation of the land for more than 30 years vested him
equitable ownership.

DBT filed a motion for reconsideration based on the grounds of prescription and laches. While
this motion was still pending, judge Bacalla died.

Then an intervenor claimed that portions of the subject land was part of the estate of certain Don
Jose de Ocampo.
CA's Ruling: CA reversed and set aside the RTC Orders dated November 8, 2001 and June 17,
2002 and reinstated the RTC Decision dated June 15, 2000. The CA held that the properties
described and included in TCT No. 200519 are located in San Francisco del Monte, San Juan del
Monte, Rizal and Cubao, Quezon City while the subject property is located in Brgy. Pasong
Putik, Novaliches, Quezon City. Furthermore, the CA held that Engr. Vertudazo's testimony that
there is a gap of around 1,250 meters between Lot 503 and Psu 123169 was not disproved or
refuted. The CA found that Judge Juanson committed a procedural infraction when he
entertained issues and admitted evidence presented by DBT in its Motion for Reconsideration
which were never raised in the pleadings and proceedings prior to the rendition of the RTC
Decision. The CA opined that DBT's claims of laches and prescription clearly appeared to be an
afterthought. Lastly, the CA held that DBT's Motion for Reconsideration was not based on
grounds enumerated in the Rules of Procedure.

Issues:

(1) Did the RTC err in upholding DBT's defenses of prescription and laches as raised in the
latter's Motion for Reconsideration? (2) Which between DBT and the respondents have a better
right over the subject property?

Held:

(1) Affirmative. The facts demonstrating the lapse of the prescriptive period be otherwise
sufficiently and satisfactorily apparent on the record; either in the averments of the plaintiff's
complaint, or otherwise established by the evidence. However, the conclusion reached by the
RTC in its assailed Order was erroneous. The RTC failed to consider that the action filed before
it was not simply for reconveyance but an action for quieting of title which is imprescriptible.

Therefore, laches will not apply to this case, because respondents' possession of the subject
property has rendered their right to bring an action for quieting of title imprescriptible and,
hence, not barred by laches. Moreover, since laches is a creation of equity, acts or conduct
alleged to constitute the same must be intentional and unequivocal so as to avoid injustice.

Thus, respondents' claim of acquisitive prescription over the subject property is baseless.
Under Article 1126 of the Civil Code, acquisitive prescription of ownership of lands registered
under the Land Registration Act shall be governed by special laws. Correlatively, Act No. 496, as
amended by PD No. 1529, provides that no title to registered land in derogation of that of the
registered owner shall be acquired by adverse possession. Consequently, in the instant case,
proof of possession by the respondents is immaterial and inconsequential.
 Note:

- action for reconveyance can be barred by prescription. When an action for reconveyance is
based on fraud, it must be filed within four (4) years from discovery of the fraud, and such
discovery is deemed to have taken place from the issuance of the original certificate of title. On
the other hand, an action for reconveyance based on an implied or constructive trust prescribes in
ten (10) years from the date of the issuance of the original certificate of title or transfer certificate
of title. The rule is that the registration of an instrument in the Office of the RD constitutes
constructive notice to the whole world and therefore the discovery of the fraud is deemed to have
taken place at the time of registration.

CASE NO. 71

Joaquin v. Reyes
G.R. No. 154645, July 13, 2004

FACTS:

Respondents filed a Complaint for reconveyance and damages, dated January 23, 1982, before
the Court of First Instance of Rizal, containing the following allegations:

a. Lourdes P. Reyes was the widow of Rodolfo A. Reyes who died on September 12, 1981.

b. Respondents Mercedes, Manuel, Miriam and Rodolfo, Jr. were the legitimate children of
respondent Lourdes P. Reyes and the deceased Rodolfo A. Reyes;

c. That 4 years before his death, Rodolfo A. Reyes had illicit relations with petitioner
Milagros B. Joaquino and such relationship bore children

d. Before his death, Rodolfo A. Reyes was Vice President and Comptroller of Warner
Barnes and Company with an income of P15,000.00 a month and, after retirement on September
30, 1980, received from said company benefits and emoluments in the amount of P315,011.79;
that respondent wife was not the recipient of any portion of the said amount.

e. On July 12, 1979, a Deed of Sale of a property consisting of a house and lot at BF
Homes, Paraaque, Metro Manila was executed by the spouses Ramiro Golez and Corazon
Golez in favor of petitioner Milagros B. Joaquino

f. The funds used to purchase this property were conjugal funds and earnings of the
deceased Rodolfo A. Reyes as executive of Warner Barnes and Company as petitioner Joaquin
was without the means to pay for the same;
g. Petitioner executed a Special Power of Attorney in favor of Rodolfo A. Reyes to
mortgage the property in order to pay the balance of the purchase price;

It was petitioners submission that her children are entitled to a share in the disputed property,
because they were voluntarily acknowledged by Rodolfo as his children.

ISSUE:

Whether or not the ruling on the filiation and the successional rights of petitioners children was
correct.

RULING:

No. The Court held that the status of an illegitimate child who claimed to be an heir to a
decedents estate could not be adjudicated in an ordinary civil action which, as in this case, was
for the recovery of property.

Matters relating to the rights of filiation and heirship must be ventilated in the proper probate
court in a special proceeding instituted precisely for the purpose of determining such rights. In
Agapay v. Palang, the Court held that the status of an illegitimate child who claimed to be an heir
to a decedents estate could not be adjudicated in an ordinary civil action which, as in this case,
was for the recovery of property.

Case No. 83

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Case 107

DOMINICA CUTANDA v. HEIRS OF ROBERTO CUTANDA

FACTS:

Roberto Cutanda owned 2 parcels of land in Bohol, and upon his death, his children became
owners of said land by inheritance. They left Bohol and established residence in Leyte. In 1988,
they returned to Bohol hoping to work on the land that was left to them. However, they
discovered that these lands were already in the possession of their relativesheirs of their uncles
and aunts.
Petitioners averred that the land in question is actually owned by their late uncle, Anastacio
Cutanda, who died without children, and left the lands to his siblings, one of which was Roberto
Cutanda.
Furthermore, they claim rightful ownership of the land as they have been in open, contiguous,
adverse, and uninterrupted possession of these for about 55 years.

The trials court found for the Petitioners. However, the CA reversed the RTCs decision.

ISSUE:

Whether or not the rights of the heirs of Roberto Cutanda have already prescribed, thus, giving
rightful ownership to the Petitioners?

HELD:

The action brought by the respondents to the court was one of accion publiciana to recover the
right to possession and to be declared rightful owners of the land. Since the complaint actually
put in issue the ownership of the land, it should thus be treated properly as an accion
reinvindicatoria.

Nevertheless, both have already prescribed as these rights are extinguished if not brought within
10 years from dispossession. Therefore, the petitioners have indeed acquired possession and
ownership of the land in question by prescription, as the respondents failed to bring this action
only 55 years later.