73.
Lavadia vs Mendoza, GR L – 47996, 9 May 19411
Engracia Lavadia, et. al., plaintiffs-appellees
vs.
Rosario Cosme de Mendoza,et al., defendants-appellants.
Counsels: L. Fernandez Lavadia y Aurelio Palileo for the appellees, and
Ortega y Ortega for the appellants.
Ponente: Justice Diaz
Facts: This is an appeal of the Court of First Instance Laguna's decision
about possession and custody of the jewelry adorning image of
Pagsanjan's patroness Our Lady of Guadalupe consisting of a diamond-
encrusted golden crown, a necklace with diamond and precious stones, a
belt encrusted with precious stones and diamonds, a golden collar
completely encrusted with precious stones, a golden bracelet encrusted
with precious stones and diamonds, etc.
In 1880, six pious (6) ladies from (then municipality of) Pagsanjan,
Laguna named Martina, Matea, Isabel, Paula, Pia and Engracia all
surnamed Lavadia, agreed that with their own money, to contribute the
abovementioned jewelries.
Except for the plaintiff Engracia, the defendants are the legal heirs of her
late sisters Isabel, Matea and Martina. Meanwhile, defendant Rosario
Cosme de Mendoza and her co-defendants are legal heirs and
descendants of her late sister Paula.
Also, the original owners (Engracia and her sisters) agreed that these
gems would be left with Pia Lavadia. Pia had the jewels' custody until her
death in 1882 after which her sister Paula succeeded her. On Paula's
death, the preservation and custody of such jewelry was given to her
1 Note to the readers, the original text of the case is in Spanish.
The digest's author cannot guarantee accuracy of the digest herein.
husband Pedro Rosales and after him, their daughter Paz Rosales took
custody, preservation and care of the jewelry.
After Paz death, the custody, preservation and management of the jewels
and the crown passed to her husband Baldomero Cosme, then to Manuel
Soriano and eventually succeeded by the defendant Rosario Cosme de
Mendoza. In fact, from 1880 up to the present time, the jewels were used
to decorate the image of Our Lady of Guadalupe in Pagsanjan every year
and none of them who keep or guard these jewels claimed to possess as
the sole owner. Defendant Rosario Cosme de Mendoza and her co-
defendants stated that they did not intend to (solely) own the jewelries.
Rosario, who was the latest custodian of the jewelries, entrusted those
jewels to the Catholic bishop of Lipa, subject to the condition that the
deposited things be used to adorn of Our Lady of Guadalupe's image but
according to the will of their owners. All these jewels are now locked and
deposited in the Bank of the Philippine Islands because Rosario Cosme
de Mendoza deposited those things there. The descendants of the Isabel,
Martina and Matea Lavadia as well as the plaintiff Engracia Lavadia filed
a case in CFI Laguna to claim possession and custody of the jewels.
The lower trial court ruled against the defendants, stating that the
plaintiffs are entitled to fourth-sixths' (4/6) pro indiviso share and the
defendants are entitled to the two sixths' pro indiviso share of the
jewelry. It ruled that Rosario Cosme de Mendoza has to deliver the
jewelries to the plaintiff and one of the previous owners Engracia.
Dissatisfied with the trial court’s decision, the defendants appealed the
decision to the Supreme Court.
Issues: These issues were raised by Rosario Cosme de Mendoza and her
co-defendants,
1. Whether or not the CFI erred in ordering the defendants the
jewelry’s delivery to the plaintiffs, even if they did not intend to
have the sole ownership and custodianship of the said items?
2. Whether or not that the CFI erred to declare that plaintiffs are
 entitled to fourth-sixths' (4/6) and the defendants, only entitled thing deposited from its depositary like in circumstances when the
to the two sixths' share of the said jewelries? depositary performed acts against the orders of the depositor and
3. Whether or not that CFI erred in its failure to declare that his/her heirs.
defendant-appellant Rosario Cosme de Mendoza, cannot be
deprived of jewels’ custody and administration except only when SO ORDERED.
she is incapacitated, when she executed acts contrary to the will
of previous owners? Justices Imperial, Laurel, Moran and Horrilleno, concurring.
4. Whether or not that Rosario Cosme de Mendoza, being the
jewelry’s possessor and custodian, faithfully performed her
duties?
5. Whether or not the CFI erred in denying her petition for a new
trial?

Held by the Supreme Court:

The Court affirmed a quo the CFI Laguna’s decision on appeal, seeing
that it did not commit any error in its judgment, and the defendant-
appellants are to pay the costs of suit.

It is uncontested that in proportion to each one's interest, all of the

parties has ownership and need to contribute equally a share in the costs
of the administration and preservation of the jewelries, as required by
Article 393 of the Old Civil Code. Therefore, the CFI was right in
concluding that the appellees have fourth-sixths’ (4/6) and appellants
two-sixths (2/6) share.

The Court ruled that based on the facts above, there was clearly a
contract of deposit among the parties, including Rosario Cosme de
Mendoza, as deemed in Article 1758 of the Old Civil Code. Moreover, it
was ruled that even among common owners of a thing, one of them may
have its custody (as depositary), and the depositary is subjected to the
same obligations under the law with respect to the conservation of the
thing with the care, diligence and interest of a good father. Thus,
Rosario’s argument was rejected in proposition that the deposited
jewelries cannot be withdrawn from her administration and custody by
the plaintiffs, since in a contract of deposit, a depositor can withdraw the
74. MELENCIO V. DY TIAO LAY GR NO. L-32047| November 1, 1930
PETITONERS/PROSECUTORS: Manuel, Mariano, Pura, and Caridad
Melencio
RESPONDENTS/DEFENDANTS: Dy Tiao Lay
TOPIC:
 Co-ownership
 To protest against acts of majority which are
prejudicial to minority
CASE SUMMARY: Plaintiffs are children/heirs of Ramon, who co-owned
land with his siblings and his nephew Jose P. The land was leased to Yap
Kui Chin by their Ramon’s siblings, without signature of Ramon or Jose P.
The rights of Yap were assigned to defendant. Plaintiffs prayed that the
contract of lease be declared void because it involved alteration of
property but had no signature of all co-owners. SC held the contract to
be void, not because it lacked the signature of all the co-owners but
because it went beyond the 6-year limit set by the Civil Code, since the
contract was for 20 years extendible by 40 more years (60 years total).
The part owners representing the greater portion of the property held in
common have no power to lease said property for a longer period than
six years without the consent of all the c- oowners, whose propriety
rights, expressly recognized by the law, would by contracts of long
duration be restricted or annulled
FACTS:
 Plaintiffs brought this present action against defendant for the
recovery of a parcel of land in Nueva Ecija and demanded a monthly
rental of P300 for the use of occupation of the land
o Also prayed that if found that defendant occupied land by virtue of a
contract of lease, such contract be declared null and void for lack of
consent, concurrence, and ratification by the owners thereof
   Land was originally owned by Julian Melencio. He died, left
wife Ruperta Garcia, and 5 kids Juliana, Ramon, Ruperta (yeah
same name), Pedro R. and Emilio.
   Emilio had a son, Jose P. Then Emilio died.
   Jose P. then succeeded his father’s interest in the land.
   Ruperta Garcia, Pedro R., Juliana, and Ruperta executed lease
contract in favor of a Yap Kui Chin. No mention of Ramon or Jose
P. in the lease.
o Lease was for 20 years extendible for another 20 at lessee’s option.
o After termination of original period, lessors had option to buy all the
improvements on the land but if they didn’t exercise that privilege, lease
would continue for another 20 years
o The document was duly acknowledged but was never recorded with
register of deeds.
It appeared that Yap Kui Chin always dealt with Pedro R. in lease
matters. But then Pedro died.
Yap Kui Chin died also, so the lease was transferred to Uy Eng Jui, then to
defendant Dy Tiao Lay.
When Ramon died, his widow Liberata was appointed administratrix of
his estate, which included the land registered under the torrens system.
The lease wasn’t mentioned in the certificate of title but it was stated
that one house and three warehouses were property of Yap Kui Chin.
Extrajudicial partition of land by heirs of Julian Melencio, then heirs of
Ramon Melencio (plaintiffs) Liberata, as administratrix of estate of
deceased Ramon, collected rent for the lease at P20, and later she
demanded that the rent be raised to P300. Defendant then told her that
there was a written lease and that he was entitled to an extension.
Plaintiffs insisted that there was no contract of lease and anyway if there
was, it was void because of the following:
o Lease contract called for an alteration of the property and thus needed
to be signed by all co-owners
o Contract duration was for a term over six years, making it null and void
because of Civil Code Art 1548
o Contract duration was unreasonably long, and against public policy
Trial court ruled in favor of defendant. Hence this appeal
WON...the contract of lease is void because it contained alterations to the
property and it wasn’t signed by all co-owners – NO
WON...the contract of lease is void ANYWAY because of other reasons –
YES.
ISSUES:
WON...the contract of lease is void because it contained alterations to the
property and it wasn’t signed by all co-owners – NO
WON...the contract of lease is void ANYWAY because of other reasons –
YES.
RULING:
 1st issue: NO.
o Plaintiff’s contention is based on article 397 of the Civil Code which
provides that "none
of the owners shall, without the consent of the others, make any
alterations in the common property even though such alterations might
be advantageous to all."
o We do not think that the alterations are of sufficient importance to
nullify the lease, especially so since none of the co-owners objected to
such alterations until over twenty years after the execution of the
contract of lease. The decision of this court in the case of Enriquez vs. A.
S. Watson and Co. (22 Phil., 623), contains a full discussion of the effect
of alterations of leased community property, and no further discussion
upon the point need here be considered.
 2nd issue: YES. The said contract of lease being for a term of over six
years, the same is null and void pursuant to the provision of article 1548
of the Civil Code. Also, the duration of the same is unreasonably long,
thus being against public policy.
o In the present case only a small majority of the coowners executed the
lease here in question, and according to the terms of the contract the
lease might be given a duration of sixty years;
o The part owners representing the greater portion of the property held
in common have no power to lease said property for a longer period
than six years without the consent of all the c-oowners, whose propriety
rights, expressly recognized by the law, would by contracts of long
duration be restricted or annulled;
o As under article 1548 of the Civil Code such contracts cannot be
entered into by the husband with respect to his wife's property, by the
parent or guardian with respect to that of the child or ward, and by the
manager in default of special power, since the contract of lease only
produces personal obligations, and cannot without the consent of all
persons interested or express authority from the owner, be extended to
include stipulations which may alter its character, changing it into a
contract of partial alienation of the property leased.
DISPOSITIVE: The appealed judgment as to the validity of the lease is
therefore reversed, and it is ordered that the possession of the land in
controversy be delivered to the

intervenor Liberata Macapagal in her capacity as administratrix of the

estate of the deceased Ramon Melencio. It is further ordered that the
defendant pay to said administratrix a monthly rent of P50 for the
occupation of the land from May 1st, 1926, until the land is delivered to
the administratrix. The sum of P272 demanded by the defendant in his
counterclaim may be deducted from the total amount of the rent due and
unpaid. The building erected on the land by the defendant and his
predecessors in interest may be removed by him, or otherwise disposed
of, within six months from the promulgation of this decision. Without
costs. So ordered.
75. ANGELA I. TUASON, plaintiff-appellant,  Some of the reasons advanced by appellant to have the memorandum
vs.
ANTONIO TUASON, JR., and GREGORIO ARANETA, INC., defendants-
FACTS: In 1941 the sisters Angela I. Tuason and Nieves Tuason de
Barreto and their brother Antonio Tuason Jr., held a parcel of land with
an area of 64,928.6 sq. m. covered by Certificate of Title No. 60911 in
Sampaloc, Manila, in common, each owning an undivided 1/3 portion
The share of Nieves was sold to Gregorio Araneta Inc., a domestic
corporation, and a new Certificate of Title No. 61721 was issued in lieu
of the old title No. 60911 covering the same property. The three co-
owners agreed to have the whole parcel subdivided into small lots and
then sold, the proceeds of the sale to be later divided among them.
Before, during and after the execution of this contract , Atty. J. Antonio
Araneta was acting as the attorney-in-fact and lawyer of the two co-
owners, Angela I. Tuason and her brother Antonio Tuason Jr. At the same
time he was a member of the Board of Director of the third co-owner,
Araneta, Inc.
On September 16, 1944, Angela I. Tuason revoked the powers conferred
on her attorney-in-fact and lawyer, J. Antonio Araneta because of alleged
breach of the terms of the "Memorandum of Agreement" and abuse of
powers granted to it in the document, she had decided to rescind said
contract and she asked that the property held in common be partitioned.
Later, Angela filed a complaint in the Court of First Instance of Manila
asking the court to order the partition of the property in question and
that she be given 1/3 of the same including rents collected during the
time that the same including rents collected during the time that Araneta
Inc., administered said property.
The suit was administered principally against Araneta, Inc. Plaintiff's
brother, Antonio Tuason Jr., one of the co-owners evidently did not agree
to the suit and its purpose, for he joined Araneta, Inc. as a co-
defendant.however the court dismissed the complaint without
pronouncement as to costs. The plaintiff appealed from that decision.
contract (Exh. 6) declared null and void or rescinded are that she had
been tricked into signing it; that she was given to understand by Antonio
Araneta acting as her attorney-in-fact and legal adviser that said contract
would be similar to another contract of subdivision of a parcel into lots
and the sale thereof entered into by Gregorio Araneta Inc., that the
defendant company has violated the terms of the contract by not
previously showing her the plans of the subdivision, the schedule of
prices and conditions of the sale, in not introducing the necessary
improvements into the land and in not delivering to her her share of the
proceeds of the rents and sales.
ISSUE: Whether or not the contract should be declared null and void
because its terms, particularly paragraphs 9, 11 and 15 which violate the
provisions of Art. 400 of the Civil Code
RULING:
ART. 400. No co-owner shall be obliged to remain a party to the
community. Each may, at any time, demand the partition of the thing
held in common.
Nevertheless, an agreement to keep the thing undivided for a specified
length of time, not exceeding ten years, shall be valid. This period may be
a new agreement.
We agree with the trial court that the provisions of Art. 400 of the Civil
Code are not applicable. The contract far from violating the legal
provision that forbids a co-owner being obliged to remain a party to the
community, precisely has for its purpose and object the dissolution of
the co-ownership and of the community by selling the parcel held in
common and dividing the proceeds of the sale among the co-owners. The
obligation imposed in the contract to preserve the co-ownership until all
the lots shall have been sold, is a mere incident to the main object of
dissolving the co-owners. By virtue of the document, the parties thereto
practically and substantially entered into a contract of partnership as the
best and most expedient means of eventually dissolving the co-
ownership, the life of said partnership to end when the object of its
creation shall have been attained.

Looking at the case from a practical standpoint as did the trial court, we
find no valid ground for the partition insisted upon the appellant.

In view of the foregoing, the decision appealed from is hereby affirmed.

There is no pronouncement as to costs.
76. MARIANO v. COURT OF APPEALS
June 7, 1989 (174 SCRA 335)
FACTS:
The proceedings at bar concern (1) an attempt by a married man to
prevent execution against conjugal property of a judgment rendered
against his wife, for obligations incurred by the latter while engaged in a
business that had admittedly redounded to the benefit of the family, and
(2) the interference by a court with the proceedings on execution of a co-
equal or coordinate court. Both acts being proscribed by law, correction
is called for and will hereby be effected.
The proceedings originated from a suit filed by Esther Sanchez against
Lourdes Mariano in the Court of First Instance at Caloocan City, for
recovery of the value of ladies’ ready made dresses allegedly purchased
by and delivered to the latter.
Daniel Sanchez, Esther’s husband, now made his move. He filed a
complaint for annulment of the execution in the Court of First Instance at
Quezon City in his capacity as administrator of the conjugal partnership.
He alleged that the conjugal assets could not validly be made to answer
for obligations exclusively contracted by his wife, and that, moreover,
some of the personal property levied on, such as household appliances
and utensils necessarily used in the conjugal dwelling, were exempt from
execution.
ISSUE: WON the claim that property levied on in execution of a judgment
is not property of the judgment debtor, Daniel Sanchez’s wife, but of the
conjugal partnership of the Sanchez Spouses
HELD:
In the case at bar, the husband of the judgment debtor cannot be deemed
a “stranger” to the case prosecuted and adjudged against his wife. In any
case, whether by intervention in the court issuing the writ, or by
separate action, it is unavailing for either Esther Sanchez or her husband,
Daniel, to seek preclusion of the enforcement of the writ of possession
against their conjugal assets. For it being established, as aforestated, that
Esther had engaged in business with her husband’s consent, and the
income derived therefrom had been expended, in part at least, for the
support of her family, the liability of the conjugal assets to respond for
the wife’s obligations in the premises cannot be disputed.
LOURDES MARIANO v. CA, GR No. 51283, 1989-06-07
Facts:
A writ of preliminary attachment issued at Esther Sanchez' instance,
upon a bond posted by Veritas Insurance Company in the amount of
P11,000.00, and resulted in the seizure of Lourdes Mariano's property
worth P15,000.00 or so.[3] Her motion for the discharge of the
attachment having been denied,[1] Lourdes Mariano went up to the
Court of Appeals on certiorari.  That Court... ordered2 the Trial Court to
receive evidence on whether or not the attachment had been
improvidently or irregularly issued.[3] The Trial Court did so, came to
the conclusion that... the attachment had indeed been improperly issued,
and consequently dissolved it.[4]
Trial then ensued upon the issues arising from the complaint as well as
Lourdes Mariano's answer with counterclaim -- which included a claim
for damages resulting from wrongful attachment.
On the counterclaim, the plaintiff is ordered to pay unto defendant the
following, as follows:... a.  P7,500.00 for loss of income of the defendant
for 75 days;... b.  P16,000.00 for the value of attached goods;... c. 
P25,000.00 for moral and exemplary damages;... d.  P5,000.00 as
attorney's fees plus costs of suit.
The Veritas Insurance Company which issued the attachment bond is
ordered to pay unto the defendant the full insurance coverage of
P11,000.00 to answer for the total liability of the plaintiff thereof.
Pending approval of the record on appeal, Lourdes Mariano filed a
motion for the immediate execution of the judgment which the Court
granted.[7] In virtue of the writ of execution which afterwards issued
in... due course, the sheriff garnished the sum of P11,000.00 from Veritas
Insurance Company, and levied on real and personal property belonging
to the conjugal partnership of Esther Sanchez and her husband, Daniel
Sanchez.

Daniel Sanchez, Esther's husband, now made his move.

He alleged that the conjugal assets could not validly be made to answer
for obligations exclusively contracted by his wife, and that, moreover,
some of the personal property levied on, such as household... appliances
and utensils necessarily used in the conjugal dwelling, were exempt from
execution.

Issues:

in ruling that the conjugal partnership of Daniel and Esther Sanchez

could not be made liable for Esther's judgment obligation arising from
the spouses' joint business with Lourdes Mariano;

Ruling:

.  There is no dispute about the fact that Esther Sanchez was engaged in
business not only without objection on the part of her husband, Daniel,
but in truth with his consent and approval.

It is also... established that, as expressly acknowledged by Esther herself

and never denied by Daniel, the profits from the business had been used
to meet, in part at least, expenses for the support of her family, i.e., the
schooling of the children, food and other household... expenses.[2] Under
the circumstances, Lourdes Mariano's action against Esther Sanchez was
justified, the litigation being "incidental to the ** business in which she is
engaged,"[3]... and consequently, the conjugal partnership of Daniel and
Esther Sanchez was liable for the debts and obligations contracted by
Esther in her business since the income derived therefrom, having been
used to defray some of the expenses for the maintenance of the... family
and the education of the children, had redounded to the benefit of the
partnership
77. Verdad v. Court of Appeals estate but that she
G.R. No. 109972. April 29, 1996 is a legal heir of her husband, David Rosales, part of whose estate is a
share in his
Socorro Rosales is the widow of David Rosales who himself, some time mother’s inheritance.
after
Macaria’s death, died intestate without an issue. David Rosales, incontrovertibly, survived his mother’s death. When
Macaria died
In an instrument, dated 14 June 1982, the heirs of Ramon Burdeos, on 08 March 1956 her estate passed on to her surviving children, among
namely, his them David
widow Manuela Legaspi Burdeos and children Felicidad and Ramon, Jr., Rosales, who thereupon became co-owners of the property. When David
sold to Rosales
petitioner Zosima Verdad (their interest on) the disputed lot supposedly himself later died, his own estate, which included his undivided interest
for the price of over the
P55,460.00. In a duly notarized deed of sale, dated 14 November 1982, it property inherited from Macaria, passed on to his widow Socorro and
would her co-heirs
appear, however, that the lot was sold for only P23,000.00. Petitioner pursuant to the law on succession
explained that
the second deed was intended merely to save on the tax on capital gains

Socorro discovered the sale on 30 March 1987 while she was at the City
Treasurer’s Office. On 31 March 1987, she sought the intervention of the
Lupong
Tagapayapa of Barangay 9, Princess Urduja, for the redemption of the
property. She
tendered the sum of P23,000.00 to Zosima. The latter refused to accept
the amount for
being much less than the lot’s current value of P80,000.00.

ISSUE: Can Socorro exercise the right to redeem the property?

Yes. It is true that Socorro, a daughter-in-law (or, for that matter, a mere
relative by
affinity), is not an intestate heir of her parents-in-law; however, Socorro’
s right to the
property is not because she rightfully can claim heirship in Macaria’s
78. RAMIREZ vs. RAMIREZ
111 SCRA 82
FACTS: 
Jose Ramirez a Filipino, died in Spain leaving only his widow Marcelle
Ramirez, a French.  In the project partition, the property was divided
into 2 parts: 1st part to the widow, and 2nd part to the grandnephews
the naked ownership. Furthermore, as to the usufruct of the 2nd part,
1/3 was given to the widow and 2/3 to Wanda de Wrobleski, an
Austrian. The grandnephews opposed on the ground that usufruct to
Wanda is void because it violates the constitutional prohibition against
the acquisition of lands by aliens.
ISSUE:
WON the ground for the opposition is correct.
HELD:
No, it is not correct.
            The SC held that the Constitutional provision which enables aliens
to acquire private lands does not extend to testamentary succession for
otherwise the prohibition will be for naught and meaningless. The SC
upheld the usufruct in favor of Wanda because although it is a real right,
it does not vest title to the land in the usufructuary and it is the vesting
of title to land in favor of aliens which is proscribed by the Constitution.
Testate of Estate of Ramirez v. Ramirez, et al.
GR No. L-27962, February 15, 1982
FACTS:
Jose Eugenio Ramirez died leaving as principal beneficiaries his widow,
MarcelleSemoron de Ramirez, a French woman; his two grandnephews
Roberto and Jorge Ramirez; and his companion Wanda de Wrobleski. His
will was admitted to probate by the Court of First Instance. According to
the will ½ shall go to Marcelle in full ownership plus usufruct of the 1/3
of the whole estate; the grandsons shall have the ½ of the whole estate;
and a usufruct in favour of Wanda.
ISSUE:
 Is the partition according to the will valid?
RULING:
No. As to the usufruct granted to Marcelle, the court ruled that to give
Marcelle more than her legitime will run counter to the testator’s
intention for his dispositions even impaired her legitime and tended to
favor Wanda.As to the usufruct in favour of Wanda, the Court upheld its
validity. The Constitutional provision which enables aliens to acquire
private lands does not extend to testamentary succession for otherwise
the prohibition will be for naught and meaningless. Any alien would be
able to circumvent the prohibition by paying money to a Philippine
landowner in exchange for devise of a piece of land. Notwithstanding
this, the Court upholds the usufruct in favour of Wanda because a
usufruct does not vest title to the land in the usufructuary and it is the
vesting of title to aliens which is proscribed by the Constitution.
The court distributed the estate by: ½ to his widow and ½ to the
grandsons but the usufruct of the second half shall go to Wanda.
79. AGUILAR v. CA- Co-ownership
Any of the Co-owners may demand the sale of the house and lot at any
time and the other cannot object to such demand; thereafter the
proceeds of the sale shall be divided equally according to their
respective interests.
FACTS:
Petitioner Vergilio and respondent Senen bought a house and lot in
Paraň aque where their father could spend and enjoy his remaining years
in a peaceful neighborhood. They initially agreed that Vergilio will get
2/3 and Senen will get 1/3; but later they agreed on equal shares. Senen
was left in the said lot to take care of their father since Vergilio’s family
was in Cebu. After their father’s death petitioner demanded from private
respondent that the latter vacate the house and that the property be sold
and proceeds thereof divided among them but the latter refused.
Petitioner then filed to compel the sale of the property. The chunk of the
issue tackled by the courts was regarding the pre-trial. Respondent filed
a motion to cancel Pre-trial since the counsel had to accompany his wife
in Dumaguete City where she would be a principal sponsor in a wedding.
CFI denied the motion; and the pre-trial proceeded on the scheduled
date. The respondents did not appear thus they were declared in default.
The trial went on ex parte without the respondent and held that the
property should be sold to a third party and that the proceeds be
distributed to the parties; in addition respondent was made to pay rent
from the time the action was filed. Respondents appealed this and the
decision was reversed by the CA saying that the TC erred in declaring
respondents in default; the case was then remanded to the trial court.
Hence this appeal.
ISSUE:
A) W/N CA erred (1) in holding that the motion of respondent through
counsel to cancel the pre-trial was dilatory in character and (2) in
remanding the case to the trial court for pre-trial and trial?
ISSUE RELEVANT TO PROPERTY:
B) W/N trial court was correct with regards to the sale and rent?
RULING:
A) YES, CA erred in granting the respondents motion and remanding the
case. The law is clear that the appearance of parties at the pretrial is
mandatory. A party who fails to appear at a pre-trial conference may be
non-suited or considered as in default. It is the discretion of the court to
grant the motion if it sees that the reason for the cancelation of the same
would be reasonable. SC found that the reason for the cancelation of the
pre-trial was insufficient and that the trial court was not in grave abuse
of discretion when they denied it.
B) YES, with a few modification. Petitioner and respondents are co-
owners of subject house and lot in equal shares; either one of them may
demand the sale of the house and lot at any time and the other cannot
object to such demand; thereafter the proceeds of the sale shall be
divided equally according to their respective interests.
BASIS: Article 494 of the Civil Code provides that no co-owner shall be
obliged to remain in the co-ownership, and that each co-owner may
demand at any time partition of the thing owned in common insofar as
his share is concerned. Corollary to this rule, Art. 498 of the Code states
that whenever the thing is essentially indivisible and the co-owners
cannot agree that it be allotted to one of them who shall indemnify the
others, it shall be sold and its proceeds accordingly distributed.
SC held that ½ of the proceeds should go to the petitioner and the
remainder to the respondent (1,200 each.) Also rent was awarded 1,200
pesos per month with legal interest from the time the trial court ordered
the respondent to vacate, for the use and enjoyment of the other half of
the property.
BASIS: When petitioner filed an action to compel the sale of the property
and the trial court granted the petition and ordered the ejectment of
respondent, the co-ownership was deemed terminated and the right to
enjoy the possession jointly also ceased.
80. PERPETUA VDA. DE APE vs. COURT OF APPEALS G.R. No. 133638,
April 15, 2005
Fact: Private respondent instituted a case for “Specific Performance of a
Deed of Sale with Damages” against Fortunato and his wife Petitioner.  It
was alleged in the complaint that on 11 April 1971, private respondent
and Fortunato entered into a contract of sale of land under which for a
consideration of P5,000.00, Fortunato agreed to sell his share in Lot No.
2319 to private respondent.  The agreement was contained in a receipt
prepared by private respondent’s son-in-law, Andres Flores, at her
behest. Fortunato and petitioner denied the material allegations of the
complaint and claimed that Fortunato never sold his share in Lot No.
2319 to private respondent and that his signature appearing on the
purported receipt was forged. She also stated in her testimony that her
husband was an illiterate and only learned how to write his name in
order to be employed in a sugar central.
gleaned from Flores’s testimony, while he was very much aware of
Fortunato’s inability to read and write in the English language, he did not
bother to fully explain to the latter the substance of the receipt.  He even
dismissed the idea of asking somebody else to assist Fortunato
considering that a measly sum of thirty pesos was involved.  Evidently, it
did not occur to Flores that the document he himself prepared pertains
to the transfer altogether of Fortunato’s property to his mother-in-law. 
It is precisely in situations such as this when the wisdom of Article 1332
of the Civil Code readily becomes apparent which is “to protect a party to
a contract disadvantaged by illiteracy, ignorance, mental weakness or
some other handicap.  The Court annulled the contract of sale between
Fortunato and private respondent on the ground of vitiated consent.

Issue: Whether a contract of sale exist between the Petitioner and

Defendant?

Held: No, A contract of sale is a consensual contract, thus, it is perfected

by mere consent of the parties.  It is born from the moment there is a
meeting of minds upon the thing which is the object of the sale and upon
the price. Upon its perfection, the parties may reciprocally demand
performance, that is, the vendee may compel the transfer of the
ownership and to deliver the object of the sale while the vendor may
demand the vendee to pay the thing sold. For there to be a perfected
contract of sale, however, the following elements must be present:
consent, object, and price in money or its equivalent.   In this case, as
private respondent is the one seeking to enforce the claimed contract of
sale, she bears the burden of proving that the terms of the agreement
were fully explained to Fortunato Ape who was an illiterate.  This she
failed to do.  While she claimed in her testimony that the contents of the
receipt were made clear to Fortunato, such allegation was debunked by
Andres Flores himself when the latter took the witness stand.  As can be
81. Halili v. Court of Appeals XII, Section 7 provides that Non- Filipinos cannot acquire or hold title to
G.R. No. 113539, March 12, 1998 private lands or
to lands of the public domain, In fine, non-Filipinos cannot acquire or
Simeon de Guzman, an American citizen, died sometime in 1968, leaving hold title to private
real lands or to lands of the public domain, except only by way of legal
properties in the Philippines. His forced heirs were his widow private succession. While it
respondent Helen is true that the transfer of Helen of his right to her son who is an
Meyers Guzman, and his son, private respondent David Rey Guzman, American citizen
both of whom contradicts the prohibition set forth in the Constitution, the Supreme
are also American citizens. On August 9, 1989, Helen executed a deed of Court upheld the
quitclaim, subsequent sale of the land to Catanig, a Filipino citizen. Jurisprudence is
assigning, transferring and conveying to David Rey all her rights, titles consistent
and interests in that “if land is invalidly transferred to an alien who subsequently
and over six parcels of land which the two of them inherited from becomes a citizen or
Simeon. transfers it to a citizen, the flaw in the original transaction is considered
Among the said parcels of land is that now in litigation Guzman then sold cured and the
the title of the transferee is rendered valid.”
parcel of land to Catanaig, who is one of respondents in this case. The rationale of this principle was explained in Vasquez vs. Li Seng Giap
Petitioners, who are thus
owners of the adjoining lot, filed a complaint before the Regional Trial “[I]f the ban on aliens from acquiring not only agricultural but also urban
Court of Malolos, lands, as
Bulacan, questioning the constitutionality and validity of the two construed by this Court in the Krivenko case, is to preserve the nation’s
conveyances — lands for future
between Helen Guzman and David Rey Guzman, and between the latter generations of Filipinos, that aim or purpose would not be thwarted but
and Emiliano achieved by
Cataniag — and claiming ownership thereto based on their right of legal making lawful the acquisition of real estate by aliens who became
redemption Filipino citizens by
under Art. 1621 of the Civil Code. The trial court dismissed the naturalization. “
complaint. The CA Petition was denied.
denied the appeal of the Halilis.

ISSUE: Whether or not the sale of the land is null and void. HALILI VS CA – A. BARTOLOME

No, because the prohibition in the constitution has already been served. Doctrine
Article
If a land is invalidly transferred to an alien who subsequently becomes a
citizen or transfers it to a citizen, the flaw in the original transaction is
considered cured and the title of the transferee is rendered valid.
Facts
- Simeon de Guzman, an American citizen, died in 1968, leaving real
properties in the Philippines.
- Forced heirs:
Helen Meyers (widow), American
David Rey Guzman (son), American
- 9 Aug 1989: Helen executed a dead of quitclaim transferring to David
all her rights, titles, and interests over the inherited land (six parcels of
land).
- 5 Feb 1991: David Rey sold one of the parcels of the land to Emiliano
Cataniag, a Filipino
- Petitioners, owners of the adjoining lot, filed a complaint before the
RTC Malolos questioning the constitutionality and validity of the two
conveyances. They claim ownership of the lands based on their right of
legal redemption under Art. 1621 of the Civil Code.
- RTC dismissed the complaint, and held:
Helen's waiver of her inheritance was not contrary to the constitutional
prohibition against the sale of land to an alien, since it was simply to
authorize David Rey to dispose of their properties.
Subject land was urban, and cannot be redeemed under Art. 1621 of the
Civil Code.
- CA affirmed the RTC decision. Furthermore, it cited Tejido v. Zamacoma
and Yap v. Grageda and held:
Although the transfer of the land may have been invalid for being contrary
to the Constitution, petitioners may no longer recover the property as it
was passed on to and now owned by a qualified person.
Issues
1. WON the CA erred in concluding that the land in question is
urban, and could not be redeemed under Art. 1621 of the Civil Code.
2. WON the sale to Cataniag is valid.
Held/Ratio
1. Yes, it is urban land that cannot be redeemed under Art. 1621 of
the Civil Code.
On the Nature of Land:
- The issue on whether the land in dispute is rural or urban is a factual
question which is not reviewable by the Supreme Court. The findings of
the RTC, when affirmed by the CA, are binding upon the Supreme Court.
- There is clear and convincing evidence to prove that the subject
property is urban land (presence of different kinds of establishments,
factories, commercial stores, hospitals, etc.).
On the Right of Redemption:
- Art. 1621 of the Civil Code was invoked by the petitioners. It specifically
states that the land to be redeemed and the adjacent lot belonging to the
person exercising the right of redemption must both be rural. The
language of the law is clear. The right to redemption cannot be invoked.
2. Yes, it is valid, for whatever constitutional infirmities that arose
before the sale were rectified upon the sale to a Filipino citizen.
On Foreign Ownership of Lands:
- It is true that the deed of quitclaim collided with Art. XII, Sec. 7 of the
1987 Constitution (Sec. 5, Art. XIII of the 1935 Constitution), which
states that except in cases of hereditary succession, no private lands
shall be transferred or conveyed except to individuals... qualified to
acquire or hold lands of the public domain.
- Krivenko v. Register of Deeds interpreted Sec. 1, Art. XIII of the 1935
Constitution (Sec. 2, Art. XII of the 1987 Consti.) such that only Filipino
citizens may own public agricultural lands. Read together with Sec. 7,
this means that only Filipinos are qualified to own both public and
private lands.

Reading these two provisions together prevents the possibility that

Filipino citizens may alienate their agricultural lands in favor of aliens.
All in all, non-Filipinos cannot acquire or hold title to private lands or to
lands of the public domain, except only by way of legal succession.

On the Transfer of Lands:

- If land is invalidly transferred to an alien who subsequently becomes a
citizen or transfers it to a citizen, the flaw in the original transaction is
considered cured and the title of the transferee is rendered valid. The
sale can no longer be impugned on the basis of the invalidity of the initial
transfer.
- Jurisprudence exists that support this holding (United Church Board of
Word Ministries v. Sebastian, de Castro v. Tan, etc.).
82. Francisco v. Boiser G.R. No. 137677
Date of Promulgation: May 31, 2000
Ponente: Mendoza, J.
Petition: Petition for Review of CA decision
Petitioners: Adalia Francisco
Respondents: Zenaida Boiser
Facts:
Petitioner Adalia Francisco and three of her sisters, Ester, Elizabeth, and
Adeluisa, were co-owners of four parcels of registered land in Caloocan
City. On August 1979, they sold 1/5 of their undivided share to their
mother, Adela Blas, for P10,000, making her a co-owner of the real
property to that extent. Then in 1987, Adela sold the said portion of land
for P10,000 to Zenaida Boiser, another sister of the petitioner.
In 1992, six years after the sale, Adalia received summons from the
complaing by Zenaida demanding her share in the rentals being
collected from the tenants of the Ten Commandments Building, which
stands on her co-owned property. Adalia then informs Zenaida that she
was exercising her right of redemption as co-owner of the subject
property, depositing for that purpose P10,000 with the Clerk of Court.
The case was however dismissed after Zenaida was declared non-suited,
and Adalia’s counterclaim was dismissed as well.
Three years after, Adalia institutes a complaint demanding the
redemption of the property, contending that the 30-day period for
redemption under Art. 1623, CC had not begun to run against her or any
of the other co-owners, since the vendor Adela did not inform them
about the sale, which they only came to know when Adalia received the
summons in 1992.
Zenaida on the other hand contends that Adalia already knew of the sale
even before she received the summons since Zenaida had informed
Adalia by letter of the sale with a demand for her share of the rentals
three months before filing suit, attaching to it a copy of the deed of sale.
Adalia’s receipt of the said letter is proven by the fact that within a week,
she advised the tenants of the building to disregard Zenaida’s demand
letter.
The trial court dismissed the complaint for legal redemption, holding
Art. 1623, CC does not prescribe any particular form of notifying co-
owners on appeal; the CA affirmed. They relied on the ruling of:
Distrito v. CA
Art. 1623 does not prescribe any particular form of written
notice, nor any distinctive method for notifying the
redemptioner.
De Conejero v. CA & Badillo v. Ferrer
That furnishing the redemptioner with a copy of the deed of sale
is equivalent to giving him the written notice required by law.
In ruling that the notice given by Zenaida was sufficient, the CA relied on
its ruling in Etcuban v. CA:
Petitioner contends that vendors should be the ones to give him
written notice and not the vendees citing the case of Butte vs.
Manuel Uy & Sons, Inc. While it is true that written notice is
required by the law (Art. 1623), it is equally true that the same
"Art. 1623 does not prescribe any particular form of notice, nor
any distinctive method for notifying the redemptioner. In the
Conejero case, we ruled that the furnishing of a copy of the
disputed deed of sale to the redemptioner was equivalent to
the giving of written notice required by law in "a more
authentic manner than any other writing could have done," and
that We cannot adopt a stand of having to sacrifice substance to
technicality. More so in the case at bar, where the vendors or co-
owners of petitioner stated under oath in the deeds of sale that
 notice of sale had been given to prospective redemptioners in
accordance with Art. 1623 of the Civil Code. A sworn statement
or clause in a deed of sale to the effect that a written notice
of sale was given to possible redemptioners or co-owners
might be used to determine whether an offer to redeem was
made on or out of time, or whether there was substantial
compliance with the requirement of said Art. 1623.
Issue:
WON the letter-demand by Zenaida to Adalia can be considered as
sufficient compliance with the notice requirement of Art. 1623 for the
purpose of legal redemption. – NO
Side questions on the interpretation of Art. 1623, CC:
 Who should send notice?; and
 When do you start counting the 30-day period?
Ratio:
[WHO]
The text of Art. 1623 clearly and expressly prescribes that the 30 days
for making the redemption shall be counted from notice in writing by the
vendor. It makes sense to require that notice be given by the vendor and
nobody else, since the vendor of an undivided interest is in the best
position to know who are his co-owners, who under the law must be
notified of the sale.
In Etcuban, notice to the co-owners of the sale of the share of one of
them was given by the vendees through their counterclaim in the action
for legal redemption. Despite the apparent meaning of Art. 1623, it
was held in that case that it was "of no moment" that the notice of
sale was given not by the vendor but by the vendees. "So long as the
co-owner is informed in writing of the sale and the particulars thereof,
the 30 days for redemption start running, and the redemptioner has no
cause to complain," so it was held. The contrary doctrine of Butte v.
Manuel Uy and Sons, Inc. was thus overruled sub silencio.
However in a later ruling in Salatandol v. Retes, which was decided a
year after Etcuban, the Court expressly affirmed the ruling in Butte that
the notice required by Art. 1623 must be given by the vendor. In
Salatandol, Justice J.B.L. Reyes upheld the following:
1. Reversion to the ruling of in Butte is proper. Art. 1623 of the
Civil Code is clear in requiring that the written notification
should come from the vendor or prospective vendor, not from
any other person. There is, therefore, no room for construction.
2. It makes sense to require that the notice required in Art.
1623 be given by the vendor and by nobody else. The vendor
of an undivided interest is in the best position to know who are
his co-owners who under the law must be notified of the sale. It
is likewise the notification from the seller, which can remove all
doubts as to the fact of the sale, its perfection, and its validity, for
in a contract of sale, the seller is in the best position to confirm
whether consent to the essential obligation of selling the
property and transferring ownership thereof to the vendee has
been given. 
[WHEN]
In the present case, for instance, the sale took place in 1986, but it was
kept secret until 1992 when vendee (herein respondent) needed to
notify petitioner about the sale to demand 1/5 rentals from the property
sold. Compared to serious prejudice to petitioner’s right of legal
redemption, the only adverse effect to vendor Adela Blas and
respondent-vendee is that the sale could not be registered. It is,
therefore, unjust when the subject sale has already been established
before both lower courts and now, before this Court, to further delay
petitioner’s exercise of her right of legal redemption by requiring that
notice be given by the vendor before petitioner can exercise her right.
For this reason, we rule that the receipt by petitioner of summons in
August 1992 constitutes actual knowledge on the basis of which
petitioner may now exercise her right of redemption within 30 days
from finality of this decision.
In Alonzo v. Intermediate Appellate Court, we stated that the 30-day
period of redemption started, not from the date of the sales in 1963 and
1964, but sometime between those years and 1976, when the first
complaint for redemption was actually filed.

Decision
Petition granted. CA and RTC decision reversed.

Notes:
How is this related to legislative history?
 Use of precedents to determine interpretation of the codal provision
in Art. 1623 of the Civil Code
 Etcuban was abandonded
 Butte as was used in Salatandol was upheld

Art. 1623, CC. The right of legal pre-emption or redemption shall not be
exercised except within thirty days from the notice in writing by the
prospective vendor, or by the vendor, as the case maybe. The deed of
sale shall not be recorded in the Registry of Property, unless
accompanied by an affidavit of the vendor that he has given written
notice thereof to all possible redemptioners.
83. G.R. No. L-44426 February 25, 1982
SULPICIO CARVAJAL, petitioner,  Unless a project of partition is effected, each heir cannot claim
vs. ownership over a definite portion of the inheritance. Without partition,
THE HONORABLE COURT OF APPEALS ** and EUTIQUIANO either by agreement between the parties of by judicial proceeding, a co-
CAMARILLO and LIBERATA CACABELOS,respondents. heir cannot dispose of a specific portion of the estate. For where there
are two or more heirs, the whole estate such heirs. 1 Upon the death of a
Facts: person, each of his heirs becomes the undivided owner of the whole
The subject lot was originally owned by Hermogenes Espique and his estate left wtih respect to the part of portion which might be adjudicated
wife and after their death, the lot was succeeded by their children, Maria, to him, a community of ownership being thus formed among the co-
Evaristo, Faustino, Estefanio and Tropinio. Petitioner then averred that owners of the estate or co-heirs while it remains undivided
he purchased the 2/5 of the lot from Estefanio and respondents
purchased 1/5 of the lot from Evaristo. The part of the land in
controversy was the 1/5 portion. This prompted the private
respondents to file a case of ejectment and recovery of possession,
where in fact there has been no partition yet on the subject lot. Both the
lower court and the appellate court ruled in favor of the respondents.
Hence, this petition.

Issue:
Whether the co-owners may sell a specific part of the co-owned property
without partition.

Held:
The Supreme Court ruled in negative and reversed the decision of the
lower court.

The fact that the sale executed by Evaristo G. Espique in favor of

respondents and the sale executed by Estefanio Espique in favor of
petitioner were made before the partition of the property among the co-
heirs does not annul or invalidate the deeds of sale and both sales are
valid. However, the interests thereby acquired by petitioner and
respondents are limited only to the parts that may be ultimately
assigned to Estefanio and Evaristo, respectively, upon the partition of
the estate 7 subject to provisions on subrogation of the other co-heirs to
the rights of the stranger-purchaser provided in Article 1088 of the Civil
Code. 
84. PAMPLONA vs. MORETO area or 1,173 sq. meters as his share, he had a perfect legal and lawful
96 SCRA 775, March 31, 1980 right to dispose of 781 sq. meters of his share to the Pamplona spouses.
Moreover, private respondents, as heirs are duty-bound to comply
Facts: with the provisions of Articles 1458 and 1495, Civil Code, which is the
obligation of the vendor of the property of delivering and transferring
Flaviano Moreto and Monica Maniega were husband and wife with 6 the ownership of the whole property sold, which is transmitted on his
children. During their marriage, they acquired adjacent lots Nos. 1495, death to his heirs, the herein private respondents.
4545, and 1496.
Monica Maniega died intestate. more than (6) years after, Flaviano Under Article 776, New Civil Code, the inheritance which private
Moreto, without the consent of the heirs of his said deceased wife, and respondents received from their deceased parents and/or
before any liquidation of the conjugal partnership, executed in favor of predecessors-in-interest included all the property rights and
Geminiano Pamplona, the deed of absolute sale covering lot No. 1495 for obligations which were not extinguished by their parents' death.
P900.00.
The spouses Geminiano Pamplona and Apolonia Onte constructed their
house on the eastern part of lot 1496 as Flaviano Moreto, at the time of
the sale, pointed to it as the land which he sold to Geminiano Pamplona.
Flaviano Moreto died intestate. In 1961, the plaintiffs demanded on
the defendants to vacate the premises on the ground that Flaviano
Moreto had no right to sell the lot which he sold to Geminiano Pamplona
as the same belongs to the conjugal partnership of Flaviano and his
deceased wife.
The spouses Pamplona refused to vacate hence, this suit was instituted
seeking for the declaration of the nullity of the deed of sale as regards
one-half of the property subject matter of said deed.

Issue:

Whether petitioners are entitled to the full ownership of the property in

litigation, or only one-half of the same.

Held:

The three lots have a total area of 2,346 sq. meters. It is therefore, clear
that the three lots constitute one big land. They are not separate
properties located in different places but they abut each other. And since
Flaviano Moreto was entitled to one-half pro-indiviso of the entire land
85. Castro vs Atienza

facts

Brothers Tomas and Arsenio Castro owned pro indivisio a fishpond that
they both leased to Atienza. Tomas later died. At some point, Arsenio
wanted to cancel the lease so he can lease the property to other lessors.
Arsenio executed a document that cancelled the lease but Tomas’ widow
Felisa refused to sign. Atienza tried to recover the rents paid in advance,
but Arsenio denies liability, invoking his co- owner’s refusal to sign the
cancellation of lease.

Issue

Ruling

Arsenio must be liable for the refund of the rents, notwithstanding

Felisa’s refusal to sign the cancellation of the lease. It is understood that
Arsenio owned one-half interest while his brother, succeeded by the wife
Felisa, owned the other half. It was thus valid for one owner to lease his
half while other refused. The resulting relationship between lessee and
the co- owner/lessor is a partnership.

Application of Art. 493: Each co-owner shall have the full ownership of
his part and of the fruits and benefits pertaining thereto, and he may
therefore alienate, assign or mortgage it, and even substitute another
person in its enjoyment, except when personal rights are involved. But
the effect of the alienation or the mortgage, with respect to the co-
owners, shall be limited to the portion which may be allotted to him in
the division upon the termination of the co- ownership.
86. LEONORA ESTOQUE, plaintiff-appellant, vs.ELENA M. PAJIMULA,
assisted by her husband CIRIACO PAJIMULA, defendants-appellees.
G.R. No. L-24419           July 15, 1968
FACTS:
Lot No. 802 of the Cadastral survey of Rosario, was originally
owned by the late spouses, Rosendo Perez and Fortunata Bernal, who
were survived by her children, namely, Crispina Perez, Lorenzo Perez
and Ricardo Perez. Ricardo Perez is also now dead. On October 28, 1951,
Crispina P. Vda. de Aquitania sold her right and participation in Lot No.
802 consisting of 1/3 portion with an area of 640 square meters to
Leonora Estoque. On October 29, 1951, a deed of extrajudicial settlement
was entered into wherein Lorenzo Perez, Emilia P. Posadas and her
minor children assigned all their right, interest and participation in Lot
No. 802 to Crispina Perez. On December 30, 1959, Crispina Perez and her
children Rosita Aquitania Belmonte, Remedios Aquitania Misa, Manuel
Aquitania, Sergio Aquitania and Aurora Aquitania sold to Elena Pajimula,
the remaining 2/3 western portion of Lot No. 802 with an area of 958
square meters.
Plaintiff based her complaint for legal redemption on a claim that
she is a co-owner of Lot No. 802, for having purchased 1/3 portion
thereof, containing an area of 640 square meters as evidenced by a deed
of sale,which was executed on October 28, 1951 by Crispina Perez de
Aquitania, one of the co-owners, in her favor.
On the other hand, the defendant, who on December 30, 1959
acquired the other 2/3 portion of Lot No. 802 from Crispina Aquitania
and her children, claimed that the plaintiff bought the 1/3 southeastern
portion, which is definitely identified and segregated, hence there
existed no co-ownership at the time and after said plaintiff bought the
aforesaid portion, upon which right of legal redemption can be exercised
or taken advantage of.
Estoque’s stand is that the deed in her favor was inoperative to
convey the southeastern third of Lot 802 of the Rosario Cadastre
notwithstanding the description in the deed itself, for the reason that the
vendor, being a mere co-owner, had no right to sell any definite portion
of the land held in common but could only transmit her undivided share,
since the specific portion corresponding to the selling co-owner is not
known until partition takes place (Lopez vs. Ilustre, 5 Phil. 567; Ramirez
vs. Bautista, 14 Phil. 528). From this premise, the appellant argues that
the sale in her favor, although describing a definite area, should be
construed as having conveyed only the undivided 1/3 interest in Lot 802
owned at the time by the vendor, Crispina Perez Vda. de Aquitania.
Wherefore, when the next day said vendor acquired the 2/3 interest of
her two other co-owners, Lot 802 became the common property of
appellant and Crispina Perez. Therefore, appellant argues, when Crispina
sold the rest of the property to appellee Pajimula spouses, the former
was selling an undivided 2/3 that appellant, as co-owner, was entitled to
redeem, pursuant to Article 1620 of the New Civil Code.
ART. 1620. A co-owner of a thing may exercise the right of
redemption in case the shares of all the other co-owners or of any of
them, are sold to a third person. If the price of the alienation is grossly
excessive the redemptioner shall pay only a reasonable one.
Should two or more co-owners desire to exercise the right of
redemption, they may only do so in proportion to the share they may
respectively have in the thing owned in common.
The lower court, upon motion of defendant, dismissed the
complaint, holding that the deeds of sale show that the lot acquired by
plaintiff Estoque was different from that of the defendants Pajimula;
hence they never became co-owners, and the alleged right of legal
redemption was not proper. Estoque appealed.
ISSUE: When a person who is not the owner of a thing sells or alienates
and delivers it, and later the seller or grantor acquires title
WON right of redemption can be exercised by Estoque? thereto, such title passes by operation of law to the buyer or
grantee."
HELD:
CA decision affirmed
NO. Appellant Estoque became the actual owner of
the southeastern third of lot 802 on October 29, 1951. Wherefore, she
never acquired an undivided interest in lot 802. And when eight years
later Crispina Perez sold to the appellees Pajimula the western two-
thirds of the same lot, appellant did not acquire a right to redeem the
property thus sold, since their respective portions were distinct and
separate.

(1) The deed of sale to Estoque (Annex A of the complaint) clearly

specifies the object sold as the southeastern third portion of Lot 802 of
the Rosario Cadastre, with an area of 840 square meters, more or less.
Granting that the seller, Crispina Perez Vda. de Aquitania could not have
sold this particular portion of the lot owned in common by her and her
two brothers, Lorenzo and Ricardo Perez, by no means does it follow
that she intended to sell to appellant Estoque her 1/3 undivided interest
in the lot forementioned. There is nothing in the deed of sale to justify
such inference. That the seller could have validly sold her one-third
undivided interest to appellant is no proof that she did choose to sell the
same. .

(2) While on the date of the sale to Estoque (Annex A) said contract may
have been ineffective, for lack of power in the vendor to sell the specific
portion described in the deed, the transaction was validated and became
fully effective when the next day (October 29, 1951) the vendor, Crispina
Perez, acquired the entire interest of her remaining co-owners (Annex
B) and thereby became the sole owner of Lot No. 802 of the Rosario
Cadastral survey (Llacer vs. Muñ oz, 12 Phil. 328). Article 1434 of the
Civil Code of the Philippines clearly prescribes that — .
87. Diversified Credit Corporation vs. Rosado
Facts

Respondent Rosado, his spouse, and the other co-owners of the subject
property sold the same to petitioner Diversified Credit.

Respondent refused to vacate the same claiming it was conjugal

property as he had already constructed a house thereon. He further
claims that he neither consented to nor subsequently ratified the sale.

Issue

Ruling

Respondent must remove the house.

 While it is not disputed that his wife owns a 1/13 share, the land
has yet to

be partitioned.

 Thus, he cannot claim title to any

definite portion of land.

 Prior to partition, a co-owner has only

an ideal or abstract share in the entire thing owned in common.

While a co-owner has the right to freely sell and dispose of his undivided
interest, he has no right to sell a divided part of the real estate owned in
common. [He cannot sell a defined portion of the property until after
partition.]
88. PHILIPPINE NATIONAL BANK,
vs.
THE HON. COURT OF APPEALS (SPECIAL FIRST DIVISION), PEDRO
BITANGA, FERNANDO BITANGA, GREGORIO BITANGA, GUILLERMO
BITANGA, CLARITA BITANGA together with her husband AGRIPINO
L. RABAGO and MELITONA LAGPACAN, assisted by her husband
JORGE MALACAS.
G.R. No. L-34404. June 25, 1980.
Petition for REVIEW of the decision of the CA, which affirmed with
certain modifications the judgment of the CFI of Ilocos Norte in favor of
the respondents.
FACTS:
Property in question originally belonged to the conjugal property of
Inigo Bitanga and Rosa Ver. The original certificate of title was issued to
them and inserted in the register of deeds of Ilocos Norte. However, this
issuance was only given on December 15, 1937 which was after Inigo
died (September 25, 1935).
Still before the issuance of the title, Rosa mortgaged the entire property
in favour of PNB on October 20, 1936 for the sum of 500 pesos. However,
the mortgaged lien was not annotated in the register of deeds when the
original certificate was issued. Nevertheless, the power of attorney in
favour of PNB stated that in the event Rosa defaults, it would have the
capacity to take possession of, and retain the property mortgaged, to sell
or lease the same or any part of it, and to do such other acts as necessary
in the performance of the power granted to the mortgagee. This PA was,
on the other hand, annotated on the original certificate title.
Meanwhile, Rosa Ver defaulted in the fulfilment of her obligation with
Manila trading. So, MTC levied upon her share in the lot in question on
December 13, 1939 and had the attachment annotated on the title.
Rosa’s interest in the lot in question was sold at a public auction and was
sold to MTC as the highest bidder. A deed of sale was executed in favour
of MTC and was again annotated on the title.
MTC sold its rights over the lot to Santiago Sambrano and, again, had the
sale annotated on the title. One-half of the property passed into the
hands of MELITONA LAGPACAN, and her husband JORGE MALACAS.
Meanwhile, Rosa failed to settle her obligation with PNB. Hence, PNB,
pursuant to the PA, sold the WHOLE LOT at a public auction. PNB
became the owner since it was the highest bidder. Rosa failed to redeem
and PNB consolidated its title over the lot. However, the consolidation
was not annotated on the owner’s duplicate title since Rosa failed to
surrender it.
On November 25, 1950, PNB filed a petition before the trial court which
asked that the original title over the land be declared null and void and
prayed that a new title be issued in its name. Trial court acted favourably
on PNB’s petition and ordered what was prayed for on October 2, 1951.
On May 24, 1954, PNB sold the property to Felizardo Reyes. A new
owner’s duplicate title was issued in Reyes’s name.
On May 17, 1954, the heirs of Heirs of Inigo Bitanga, filed a complaint
before the Court of First Instance of Ilocos Norte against the Philippine
National Bank, the Register of Deeds of Ilocos Norte and Felizardo Reyes,
for reconveyance of real property and damages, with a prayer for the
issuance of an ex-parte writ of preliminary injunction restraining and
enjoining the PNB and Felizardo Reyes from consummating the sale of
the property in question and prohibiting the Register of Deeds from
registering the sale in favor of Felizardo Reyes. the writ of preliminary
injunction was issued. During the pendency of the case, Melitona
Lagpacan and Jorge Malacas, filed a Motion to admit their complaint in
intervention, alleging that they had a legal interest in the subject matter
of the case, and the same was granted.
On November 16, 1960, the CFI ruled in favour of the heirs of Bitanga
and the Malacas spouses. It mentioned that the lot in question was
conjugal in nature; that half would go to the heirs and half would go to
rosa ver. The mortgage to PNB is not an existing lien since it did not have
a special mention in the decree of registration and that the acquisition of
MTC was valid and legal. Since the MTC acquisition was valid and legal,
the sale made to Sambrano is likewise valid and legal, as well as the sale
to the Malacas spouses.
Felizardo Reyes was deemed not a purchaser in good faith and the trial
ordered the cancellation of the duplicate title in Reyes’ name.
PNB and Reyes appealed to the CA. CA affirmed the judgment of the
lower court and ordered that new titles be issued in the names of the
heirs of Bitanga and spouses Malacas (half to the heirs and half to the
Spouses). It also mentioned that the new titles would be free from
encumberance regarding the claims of PNB and Reyes.
PNB filed an M.R. to the CA but was denied, hence, the current petition.
In this petition, respondents filed a motion to dismiss on the ground that
the CA decision became final and executory since Reyes failed to join
PNB in this recourse. Moreover, it assailed the issues of PNB because
they were questions of fact and not of law, hence, they are proper for the
review of SC.
SC denied petition initially but PNB filed an M.R. stating that it still has
interests in the property. S.C. reconsidered.
ISSUES:
WON Rosa Ver could really mortgage the entire lot to PNB. (NO)
WON the sale of PNB and/or the sale of MTC were valid. (PNB:NO ; MTC:
YES)
HELD:
SC said that lot was conjugal. When Inigo died, a co-ownership was
established between the heirs and Rosa Ver. Hence, Rosa cannot validly
mortgage the whole lot since it would prejudice the rights of her co-
owners, the heirs.
One of the essential requisites to the contract of pledge and mortgage is
that the pledgor or mortgagor be the absolute owner of the thing. The
effect of the mortgage, with respect to the co-owners, shall be limited to
the portion which may be allotted to him in the division upon the
TERMINATION OF THE CO-OWNERSHIP. Thus, Rosa could only
mortgage her share and not the whole lot. She cannot give what is not
hers.
She only had usufrutuary rights over the estate left by the husband. Not
being an owner, she cannot alienate or dispose of the objects included in
the usufruct. (as per the old civil code which was in force during the time
of Inigo’s death).
Though there were tax declarations in the name of Rosa, it does not alter
the conjugality of the lot. Tax declarations are not sufficient evidences of
title and should not prejudice the rights of the co-owners. As far as the
shares are concerned, the respective shares of the co-owners were not
included in the mortgage.
Thus, mortgage/subsequent sale to PNB and subsequent sale of PNB to
Reyes were invalid.
On the other hand, there is no showing that the Manila Trading Company
(MTC) had any knowledge or notice of the prior mortgage in favor of the
PNB, hence, it may be safely presumed that it (MTC) acquired the rights
of Rosa Ver and Guillermo Bitanga as an innocent purchaser for value
and free from all incumbrances. From the MTC, the aforesaid rights of
Rosa and Guillermo passed to Santiago Sambrano, and from the latter, to
the Malacas Spouses. There is no question, therefore, as to spouses’
rights over the property, as against the PNB or its transferee, Felizardo
Reyes. The intervenors merely stepped into the shoes of MTC, a prior
purchaser in good faith, and thereby became entitled to all the defenses
available to said Company, including those arising from the acquisition
of the property in good faith and for value.

The judgment of the CA was AFFIRMED but was modified with respect to
the shares of the Spouses Malacas and the Heirs (since the spouses
stepped into the shoes of the MTC, they also acquired the rights and
interests of Guillermo Bitanga, hence the heirs now have 2/5 while the
spouses have 3/5).
89. Goldcrest Realty Corporation vs. Cypress Gardens Condominium
Corporation
90. TWIN TOWERS CONDOMINIUM CORPORATION v. CA, ALS
MANAGEMENT & DEVELOPMENT CORPORATION, ANTONIO
LITONJUA and SEC GR No. 123552 February 27, 2003
By Kylie Dado
FACTS:
Twin Towers filed a complaint w/ SEC against ALS and Litonjua
 Allegation:
o Twin Towers – non-stock corp organized for the sole
purpose of for the sole purpose of holding title to and
managing the common areas of Twin Towers
Condominium
o Membership in petitioner corporation is compulsory and
limited to all registered owners of units in the
Condominium
o ALS – registered owner of Unit No. 4-A
o Litonjua, corporate president of ALS, occupies it
o It collects from all its members quarterly assessments
and dues as authorized by its Master Deed and By-Laws
o Records of account show that ALS failed to pay
assessments and dues starting 1986 up to the first
quarter of 1988
 Prayer: ALS and Litonjua be ordered to pay solidarily the unpaid
condominium assessments and dues with interests and penalties
covering the four quarters of 1986 and 1987 and the first quarter
of 1988.
ALS and Litonjua filed a joint Answer w/ Counterclaim
 Assertion: No cause of action
o ALS and not Litonjua is the registered owner of the Unit
and member of petitioner exonerates Litonjua from any
liability to petitioner.
o While ALS is a juridical person that cannot by itself
physically occupy the Unit, the natural person who
physically occupies the Unit does not assume the
liability of ALS to petitioner. Neither does the agent
who acts for the corporation become personally
liable for the corporations obligation
 Claims damages:
o For preventing ALS, its agents and guests from using the
parking space, swimming pool, gym, and other facilities
of the Condominium
o Litonjua also claims damages for including his name list
of delinquent unit owners which was posted on
petitioners bulletin board
SEC’s Decision:
 Twin Towers to pay Litonjua moral and exemplary damages
 ALS to pay the assessment and dues
 However the SEC Hearing Officer did not determine the exact
amount to be paid by ALS because petitioner failed to lay down
the basis for computing the unpaid assessments and dues
Both parties filed their appeals to the SEC En Banc.
SEC En Banc’s Decision: nullified the award of damages and attorneys
fees to Litonjua on the ground that the SEC had no jurisdiction over
Litonjua
 There is no intracorporate relationship between petitioner
and Litonjua who is not the registered owner of the Unit and
thus, not a member of petitioner
 Petitioner could not invoke the doctrine of piercing the veil of
ALS corporate fiction since disregarding the corporate entity is a
function of the regular courts
 It remanded the case to the Hearing Officer to determine the
value of the services petitioner failed to render to ALS
because of the latters nonuse of the Condominium facilities,
and the value of these services could be deducted from the
unpaid assessments and dues that ALS owes petitioner
Twin Towers appealed to the CA.

CA’s Decision:
 It found the petition defective for failure to contain a sworn
certification of nonforum shopping
 Affirmed the decision of the SEC en banc that there is no ground
to pierce the veil of ALS corporate fiction
 Sustained the claim of petitioner against ALS for unpaid
assessments and dues but found that petitioner failed to
substantiate by preponderance of evidence the basis for
computing the unpaid assessments and dues
 Twin Towers is not expressly authorized by its Master Deed and
ByLaws to prohibit delinquent members from using the facilities
of the Condominium
 Interest and penalty charges - exorbitant or grossly excessive
ISSUES/SC RULING:
1) W/N Petitioner can collect assessments and dues despite its denial
to ALS of the use of the Condominium facilities pursuant to House
Rule 26.3 – YES!
ALS asserts that the denial by petitioner to ALS and Litonjua of the use of
the Condominium facilities deprived petitioner of any right to demand
from ALS payment of any condominium assessments and dues. Stated
another way, ALS advances the argument that a contracting party who is
guilty of first breaching his obligation is excused from such breach if the
other party retaliates by refusing to comply with his own obligation.
This obviously is not the law. In reciprocal obligations, when one
party fulfills his obligation, and the other does not, delay by the
other begins. Moreover, when one party does not comply with his
obligation, the other party does not incur delay if he does not perform
his own reciprocal obligation because of the first partys noncompliance.
Thus, before ALS incurred its arrearages, petitioner allowed ALS to
use the facilities. However, ALS subsequently defaulted and thus
incurred delay. It was only then that petitioner disallowed ALS and
Litonjua from using the facilities. Clearly, petitioners denial to ALS
of the Condominium facilities, after ALS had defaulted, does not
constitute a valid ground on the part of ALS to refuse paying its
assessments and dues.
House Rule 26.3 is valid. It is expressly empowered by the
Condominium Act, petitioner’s ByLaws and the Master Deed. The
Condominium Act clearly provides that the Master Deed may expressly
empower the management body, petitioner in the instant case, to
enforce all provisions in the Master Deed and Declaration of Restrictions.
Pursuant to Section 9 (a) (1) and (3) of the Condominium Act, the Master
Deed expressly authorizes petitioner to exercise all the powers granted
to the management body by the Condominium Act, petitioners Articles of
Incorporation and ByLaws, the Master Deed, and the Corporation Code.
Petitioner’s ByLaws expressly authorize petitioners Board of
Directors to promulgate rules and regulations on the use and
enjoyment of the common areas. Moreover, House Rule 26.3, which
prohibits delinquent members from using the common areas, is
necessary to ensure maintenance of the common areas. Petitioners
purpose in enacting House Rule 26.3 is to enforce effectively the
provisions of the Master Deed. House Rule 26.3 is well within the powers
of petitioner to adopt as the same is reasonably necessary to attain the
purpose for which both petitioner and the Condominium project were
created.
Petitioner would be unable to carry out its main purpose of
maintaining the Condominium common areas and facilities if
members refuse to pay their dues and yet continue to use these
areas and facilities. To impose a temporary ban on the use of the
common areas and facilities until the assessments and dues in
arrears are paid is a reasonable measure that petitioner may
undertake to compel the prompt payment of assessments and dues.
2) W/N ALS can validly offset against its unpaid assessments and
dues the value of the services withheld by petitioner – NO!
ALS has no right to a reduction of its assessments and dues to the extent
of its nonuse of the Condominium facilities. ALS also cannot offset
damages against its assessments and dues because ALS is not entitled
to damages for alleged injury arising from its own violation of its
contract. Such a breach of contract cannot be the source of rights or
the basis of a cause of action. To recognize the validity of such claim
would be to legalize ALS breach of its contract.
Also, ALS’ claim for unrendered repair services barred by estoppel was
never raised before the SEC Hearing Officer or the SEC en banc. The issue
on these alleged unrendered repairs, which supposedly caused ALS Unit
to deteriorate, was raised for the first time on appeal. The Court of
Appeals did not pass upon the same. As this claim was a separate cause
of action, which should have been raised in ALS Answer with
Counterclaim, ALS failure to raise this claim is deemed a waiver of the
claim.
3) W/N a remand of the case to the proper trial court is necessary to
determine the amounts involved
While the SC sustained the ruling of the CA, it ruled that this case can no
longer be remanded to the SEC Hearing Officer. Republic Act No. 8799
transferred SECs jurisdiction over cases involving intracorporate
disputes to courts of general jurisdiction or the appropriate regional trial
courts.
Based on the Resolution issued by this Court in AM No. 00810SC, the
Court Administrator and the Securities and Exchange Commission
should cause the transfer of the records of SECAC Nos. 377 and 378 to
the proper regional trial court for further reception of evidence and
computation of the correct amount of assessments and dues that ALS
shall pay to petitioner.
4) W/N the penalties prescribe din House Rule 26.2 are grossly
excessive and exorbitant
House Rule 26.2 clearly provides for a 24% interest and an 8% penalty,
both running annually, on the total amount due in case of failure to pay.
To reiterate, the Condominium Act expressly provides that the
Master Deed may empower the management body of the
Condominium to enforce the provisions of the declaration of
restrictions. The Master Deed authorizes petitioner, as the
management body, to enforce the provisions of the Master Deed in
accordance with petitioners ByLaws. Thus, petitioner’s Board of
Directors is authorized to determine the reasonableness of the penalties
and interests to be imposed against those who violate the Master Deed.
Petitioner has validly done this by adopting the House Rules.
The Master Deed binds ALS since the Master Deed is annotated on the
condominium certificate of title of ALS Unit. The Master Deed is ALS
contract with all Condominium members who are all coowners of
the common areas and facilities of the Condominium. Contracts
have the force of law between the parties and are to be complied with
in good faith. From the moment the contract is perfected, the parties are
bound to comply with what is expressly stipulated as well as with what
is required by the nature of the obligation in keeping with good faith,
usage and the law. Thus, when ALS purchased its Unit from
petitioner, ALS was bound by the terms and conditions set forth in
the contract, including the stipulations in the House Rules of
petitioner, such as House Rule 26.2.
An award of attorneys fees and expenses of litigation is proper under the
instances provided for in Article 2208 of the Civil Code.
91. SUNSET VIEW CONDOMINIUM CORPORATION, petitioner,  interest thereon amounting to P6,168 06 against Lim Siu Leng to whom
G.R. No. L-52361 April 27, 1981 - vs.THE HON. JOSE C. CAMPOS, JR.
OF THE COURT OF FIRST INSTANCE, BRANCH XXX, PASAY CITY and
AGUILAR-BERNARES REALTY, respondents.
G.R. No. L-52524 April 27, 1981 - vs. THE HON. JOSE C. CAMPOS, JR.,
PRESIDING JUDGE OF THE COURT OF FIRST INSTANCE, BRANCH
XXX, PASAY CITY, and LIM SIU LENG, respondents.
These two cases which involve similar facts and raise identical questions
of law were ordered consolidated by resolution of the court.
Facts:  G.R. No. L-52361 - Aguilar-Bernares Realty, a sole proprietorship
with business name registered, owned and operated by the spouses
Emmanuel G. Aguilar and Zenaida B. Aguilar, is the assignee of a unit,
"Solana", in the Sunset View Condominium Project with La Perla
Commercial, Incorporated, as assignor. The La Perla Commercial,
Incorporated bought the "Solana" unit on installment from the Tower
Builders, Inc. Sunset View Condominium Corporation, filed for the
collection of assessments levied on the unit against Aguilar-Bernares
Realty. Private respondent filed a Motion to Dismiss the complaint,
petititioner filed its opposition and the motion to dismiss was granted by
the respondent Judge who opined that the private respondent is,
pursuant to Section 2 of RA No. 4726, a "holder of a separate interest"
and consequently, a shareholder of the plaintiff condominium
corporation; and that "the case should be properly filed with the
Securities & Exchange Commission which has exclusive original
jurisdiction on controversies arising between shareholders of the
corporation." the motion for reconsideration thereof having been
denied, the petitioner, alleging grave abuse of discretion on the part of
respondent Judge, filed the instant petition for certiorari praying that the
said orders be set aside.
G.R. NO. 52524 - Petitioner filed its amended complaint for the collection
of overdue accounts on assessments and insurance premiums and the
was assigned on a unit called "Alegria" of the Sunset. View Condominium
Project by Alfonso Uy who had entered into a "Contract to Buy and Sell"
with Tower Builders, Inc. over the said unit on installment basis. 
Private respondent filed a motion to dismiss on the ground of lack of
jurisdiction, alleging that the amount sought to be collected is an
assessment. The correctness and validity of which is certain to involve a
dispute between her and the petitioner corporation; that she has
automatically become, as a purchaser of the condominium unit, a
stockholder of the petitioner pursuant to Section 2 of the Condominium
Act; that the dispute is intra-corporate and is consequently under the
exclusive jurisdiction of the Securities & Exchange Commission.
Petitioner filed its opposition, alleging that the private respondent who
had not fully paid for the unit was not the owner thereof, consequently
was not the holder of a separate interest which would make her a
stockholder, and that hence the case was not an intra-corporate dispute. 
After the private respondent filed her answer to the opposition to the
motion to dismiss of the petitioner, the trial court issued an order
denying the motion to dismiss. The private respondent's motion for
reconsideration was denied by the trial court. Private respondent then
appealed, petitioner filed its "Motion to Dismiss Appeal" on the ground
that the order of the trial court appealed from is interlocutory. The
motion to dismiss the appeal was denied and the parties were ordered to
submit their respective memorandum on the issue raised before the trial
court and on the disputed order of the trial judge.  After the parties
submitted their respective memoranda on the matter, the Judge issued
an order in which he directed that "the appeal is hereby dismissed and d
the judgment of the lower court is reversed. The case is dismissed and
the parties are directed to ventilate their controversy with the Securities
& Exchange Commission.  The petitioner's motion for reconsideration
was.  Hence this petition for certiorari, alleging grave abuse of discretion
on the part of the respondent Judge.
Issue: 1. Is a purchaser of a condominium unit in the condominium
project managed by the petitioner, who has not yet fully paid the
purchase price thereof, automaticaly a ,stockholder of the petitioner
Condominium Corporation?
2. Is it the regular court or the Securities & Exchange Commission that
has jurisdiction over cases for collection of assessments assessed by the
Condominium Corporation on condominium units the full purchase price
of which has not been paid?
Ruling: Questioned orders of the respondent Judge are set aside and
said Judge is ordered to try the case on the merits.
Ration: 1) Section 5 of the Condominium Act expressly provides that the
shareholding in the Condominium Corporation will be conveyed only in
a proper case. It provides: Any transfer or conveyance of a unit or an
apartment, office or other space therein, shall include the transfer or
conveyance of the undivided interests in the common areas or, in a proper
case, the membership or shareholding in the condominium corporation
It is clear that not every purchaser of a condominium unit is a
shareholder of the condominium corporation. The Condominium Act
leaves to the Master Deed the determination of when the shareholding
will be transferred to the purchaser of a unit. Thus, Section 4 of said Act
provides: The provisions of this Act shall apply to property divided or to be
divided into condominium only if there shall be recorded in the Register of
Deeds of the province or city in which the property lies and duly annotated
in the corresponding certificate of title of the land an enabling or master
deed which shall contain, among others, the following:
(d) Astatement of the exact nature of the interest acquired or to be
acquired by the purchaser in the separate units and in the common areas
of the condominium project ...
The Amended Master Deeds in these cases, which were duly registered
in the Register of Deeds, and contain, by mandate of Section 4, a
statement of the exact nature of the interest acquired by a purchaser of a
unit, provide in Section 6 of Part 1: (d) Each Unit owner shall, as an
essential condition to such ownership, acquire stockholding in the
Condominium Corporation herein below provided.
The Amended Master Deeds provide in Section 7: b) All unit owners shall
of necessity become stockholders of the Condominium Corporation.
TOWER shall acquire all the shares of stock of SUNSET VIEW and shall
allocate the said shares to the units in proportion to the appurtenant
interest in the COMMON AREAS and LIMITED COMMON AREAS as
provided in Section 6 (b) above. Said shares allocated are mere
appurtenances of each unit, and therefore, the same cannot be transferred,
conveyed, encumbered or otherwise disposed of separately from the Unit.
It is clear from the of the Master Deeds that the shareholding in the
Condominium Corporation is inseparable from the unit to which it is
only an appurtenant and that only the owner of a unit is a shareholder in
the Condominium Corporation.
(a) of Part 1, Section 6, of the Master Deeds determines when and under
what conditions ownership of a unit is acquired by a purchaser thus: (a)
The purchaser of a unit shall acquire title or ownership of such Unit,
subject to the terms and conditions of the instrument conveying the unit to
such purchaser and to the terms and conditions of any subsequent
conveyance under which the purchaser takes title to the Unit, and subject
further to this MASTER DEED .
In both deeds of conveyance, it is provided: 4. Upon full payment by the
BUYER of the total purchase price and full compliance by the BUYER of an
its obligations herein, the SELLER will convey unto the BUYER, as soon as
practicable after completion of the construction, full and absolute title in
and to the subject unit, to the shares of stock pertaining thereto and to an
rights and interests in connection therewith.
The share of stock appurtenant to the unit be transferred accordingly to
the purchaser of the unit only upon full payment of the purchase price at
which time he will also become the owner of the unit. Even under the 2) Case for collection cannot be a "controversy arising out of
contract, it is only the owner of a unit who is a shareholder of the intracorporate or partnership relations between and among
Condominium Corporation. Inasmuch as owners is conveyed only upon stockholders, members or associates; between any or all of them and the
full payment of the purchase price, it necessarily follows that a corporation, partnership or association of which they are stockholders,
purchaser of a unit who has not paid the full purchase price thereof is members or associates, respectively" which controversies are under the
not The owner of the unit and consequently is not a shareholder of the original and exclusive jurisdiction of the Securities & Exchange
Condominium Corporation. Commission, pursuant to Section 5 (b) of P.D. No. 902- A. The subject
matters of the instant cases according to the allegations of the
Only the owner of a unit is a stockholder of the Condominium complaints are under the jurisdiction of the regular courts.
Corporation is inferred from Section 10 of the Condominium Act which
reads: SEC. 10. Membership in a condominium corporation, regardless of
whether it is a stock or non-stock corporation, shall not be transferable
separately from the condominium unit of which it is an appurtenance
When a member or stockholder ceases is to own a unit in the project in
which the condominium corporation owns or holds the common areas, he
shall automatically cease to be a member or stockholder of the
condominium corporation.

Pursuant to the above statutory provision, ownership of a unit is a

condition sine qua non  to being a shareholder in the condominium
corporation. It follows that a purchaser of a unit who is not yet the
owner thereof for not having fully paid the full purchase price, is not a
shareholder By necessary implication, the "separate interest" in a
condominium, which entitles 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. This is so
because nobody can be a shareholder unless he is the owner of a unit
and when he ceases to be the owner, he also ceases automatically to be a
shareholder.

The private respondents, therefore, who have not fully paid the purchase
price of their units and are consequently not owners of their units are
not members or shareholders of the petitioner condominium
corporation,
92. LILIAN CAPITLE, SOFRONIO CORREJADO, ARTEMIO CORREJADO,
VICENTE CORREJADO, CECILIA CORREJADO, GLORIA VDA. DE
BEDUNA, ROGELIA CORREJADO, MANUEL CORREJADO, RODOLFO
CORREJADO, TERESITA C. AMARANTE, JUANITA CORREJADO AND
JULIETA C. PEREGRINO, petitioners, vs. JULIETA VDA. DE GABAN,
JULIA CORREJADO AND HERMINIGILDO CORREJADO, respondents.
DIGEST
DOCTRINE: Article 19 of the Civil Code in Chapter 2 on Human
Relations is a statement of principle that supplements but does not
supplant a specific provision of law.
FACTS:
Fabian Correjado (Fabian) inherited from his father Santos Correjado
two parcels of land subject of the case at bar.
Fabian died intestate in 1919. He was survived by four children, namely:
Julian, Zacarias, Francisco and Manuel, all surnamed Correjado.
After Fabian’s death in 1919, his son Julian occupied and cultivated the
two subject parcels of land (the property) until his death in 1950. He
was survived by three children, namely, herein respondents Julieta vda.
de Gaban (Julieta), Julia Correjado (Julia) and Hermegildo Correjado.
Julian’s brother Francisco died in 1960. He was survived by herein
petitioners Manuel Correjado, Teresita C. Amarante, Juanita Correjado,
Rodolfo Correjado, and Jileta Peregrino.
Julian’s brother Zacarias died in 1984. He was survived by the other
petitioners herein, Aurora P. vda. de Correjado, Lilia Capitle, Artemio
Correjado, Cecilia Correjado, Rogelia Correjado (Rogelia), Sofronio
Correjado, Vicente Correjado and Gloria vda. de Beduna.
petitioners filed a complaint for partition of the property and damages
before the Regional Trial Court (RTC) of La Carlota City against
respondents, alleging that Fabian contracted two marriages, the first
with Brigida Salenda who was the mother of Julian, and the subsequent
one with Maria Catahay (Maria) who was the mother of Zacarias, Manuel
and Francisco; that the property remained undivided even after the
death of Julian in 1950, his children-herein respondents having
arrogated unto themselves the use and enjoyment of the property, to the
exclusion of petitioners; and that respondents refused to deliver
petitioners’ share in the property despite demands therefor and for
partition.
Respondents answered that in the proceedings in the intestate estate of
their great grandfather Santos Correjado, petitioners were not
adjudicated any share in the property, for Maria, the mother of
petitioners’ respective fathers Francisco and Zacarias, was just a
mistress of Fabian, hence, Francisco and Zacarias (as well as Manuel)
were illegitimate who were not entitled to inherit under the old Civil
Code (Spanish Civil Code of 1889).
RTC dismissed the complaint upon the grounds of prescription and
laches.
CA dismissed the appeal and affirmed the decision of the trial court. The
appellate court found that respondents failed to discharge the onus of
proving that Francisco and Zacarias were illegitimate. But it too found
that petitioners also failed to prove that Zacarias and Francisco were
legitimate. And the action of the petitioners has prescribed.
Petitioners filed a motion for reconsideration of the appellate court’s
decision upon the ground that “THIS CASE HAS BEEN OVERTAKEN BY
EVENTS, PARTICULARLY ART. 19 OF THE [NEW] CIVIL CODE” which
reads:
ART. 19. Every person, must be in the exercise of his rights and in the
performance of his duties, act with justice, give everyone his due, and
observe honesty and good faith.
Petitioners contend that “[t]here is such a thing as morality that comes
into play,” as after all, the appellate court found the parties to be first
cousins and, therefore, following Art. 19 of the Civil Code, petitioners
should get their share in the property.
ISSUE:
WHETHER OR NOT RELIANCE ON ART. 19 OF THE CIVIL CODE
ISMISPLACED.
HELD:
The petition fails.
Article 19 of the Civil Code in Chapter 2 on Human Relations is a
statement of principle that supplements but does not supplant a specific
provision of law.
With respect to rights to the inheritance of a person who died before the
effectivity on August 30, 1950 of the Civil Code like Fabian who died in
1919:
Art. 2263, New Civil Code
ART. 2263. Rights to the inheritance of a person who died, with or
without a will, before the effectivity of this Code, shall be governed by
the Civil Code of 1889, by other previous laws, and by the Rules of Court.
xxx
ART. 807, Spanish Civil Code of 1889
ART 807. The following are forced heirs:
1. Legitimate children and descendants, with respect to their legitimate
parents and ascendants;
2. In default of the foregoing, legitimate parents and ascendants, with
respect to their legitimate children and descendants;
The widower or widow, natural children legally acknowledged, and the
father or the mother of the latter, in the manner and to the extent
established by Articles 834, 835, 836, 837, 840, 841, 842, and 846.
ART. 939, Spanish Civil Code of 1889,
ART. 939. In the absence of legitimate descendants and ascendants, the
natural children legally acknowledged and those legitimated by royal
concession shall succeed to the entire estate of the deceased.
With respect to prescription:
Art. 1134, New Civil Code
ART. 1134. Ownership and other real rights over immovable property
are acquired by ordinary prescription through possession of ten years.
Art. 1137, New Civil Code
ART. 1137. Ownership and other real rights over immovables also
prescribe through uninterrupted adverse possession thereof for thirty
years, without need of title or of good faith.
Assuming arguendo that petitioners’ respective fathers Francisco and
Zacarias were legitimate and, therefore, were co-owners of the property:
From the moment co-owner Julian occupied in 1919 and claimed to be
the absolute and exclusive owner of the property and denied his
brothers any share therein up to the time of his death in 1950, the
question involved is no longer one of partition but of ownership in which
case imprescriptibility of the action for partition can no longer be
invoked. The adverse possession by Julian and his successors-in-
interest- herein respondents as exclusive owner of the property having
entailed a period of about 67 years at the time of the filing of the case at
bar in 1986, ownership by prescription had vested in them.
93. Cavile v. Heirs of Clarita Cavile
GR No. 148635 April 1, 2003
Puno, J.
Nature: Petition for review on certiorari of a decision of the Court of
Appeals
Doctrine: The execution by one of the petitioners of the certificate of
non-forum shopping constitutes substantial compliance with the Rules
where all the petitioners, being relatives and co-owners of the properties
in dispute, share a common interest.
Facts:
 Bernardo Cavile – contracted 3 marriages and acquired 6 parcels
of land now being disputed
1. Ines Dumat-ol – 1 child (Simplicia)
2. Orfia Colalho – 2 children (Fortunato and Vevencia)
3. Tranquilina Galon – 3 children (Castor, Susana and
Benedicta)
 Oct 1977 – descendants of his 1st and 2nd marriage (herein
respondents) filed a complaint for partition against the
descendants of his 3rd marriage (herein petitioners).
Allegation:
- They are co-owners of the properties in question
having inherited them from Bernardo
- Upon the death of Bernardo, his son by 3rd
marriage (Castor) took possession of the
properties as administrator for and in behalf of
his co-owners
- When Castor died, his children took possession of
the land but no longer as administrators. They
claimed the properties and their fruits as their
own and repeatedly refused respondents’
demand for partition.
 Among the evidence proferred was a notarized Deed of Partition
executed by the heirs of Bernardo Cavile in 1937.
 Trial court – dismissed the petition for partition.
 Upon appeal, CA reversed the decision saying the trial court
erred in admitting the Deed of Partition as evidence without
proof of its authenticity and due execution.
 Hence, this petition.
 The respondents pray for the denial of the petition on two
grounds: it violates the rule on the certification against forum
shopping; and the CA did not commit any error in its assailed
decision.
 The respondents harp on the fact that only one of the 22
petitioners, Thomas George Cavile, Sr. executed and signed the
certification against forum shopping when the Rules require that
said certification must be signed by all the petitioners.
Issue:
Was the certification against forum shopping signed by only one of the
petitioners sufficient to meet the Rules? Yes
Ruling:
 The rule is that the certificate of non-forum shopping must be
signed by all the petitioners or plaintiffs in a case and the signing
by only one of them is insufficient.
 However, the rules on forum shopping, which were designed to
promote and facilitate the orderly administration of justice,
should not be interpreted with such absolute literalness as to
subvert its own and legitimate objective.
 The rule of substantial compliance may be availed of with
respect to the contents of the certification.
 The requirement of strict compliance with the provisions
regarding the certification of non-forum shopping merely
underscores its mandatory nature in that the certification cannot
 be altogether dispensed with or its requirements completely
disregarded.
 The execution by Thomas George Cavile, Sr. in behalf of all the
other petitioners of the certificate of non-forum shopping
constitutes substantial compliance with the Rules.
 All the petitioners, being relatives and co-owners of the
properties in dispute, share a common interest, and share a
common defense in the complaint for partition. When they filed
the petition, they filed it as a collective, raising only one
argument to defend their rights over the properties in question.
 There is sufficient basis for Thomas George Cavile to speak for
and in behalf of his co-petitioners.
 The trial court was correct in dismissing the complaint for
partition, it appearing that the lawful heirs of Bernardo Cavile
have already divided the properties among themselves, as
evidenced by the Deed of Partition.
 The document (Deed of Partition) speaks for itself. It was
acknowledged before the Notary Public and recorded in his
notarial book. Documents acknowledged before notaries public
are public documents which are admissible in evidence without
necessity of preliminary proof as to their authenticity and due
execution. They enjoy the presumption of regularity. It is a prima
facie evidence of the facts stated therein.
 The respondents failed to overcome the presumption of
regularity.
 The properties left by Bernardo Cavile have already been
partitioned among his heirs.
94. Castro vs. Miat (MJ)
Syllabus Subtopic : Marriages before FC
FACTS :
Father of two children, Moises, widower (wife died in 1978), originally
intended his two properties, one in Paco and the other in Paranaque for
his offspring but reverted to keeping the latter for himself while in
Dubai, UAE. He modified the original agreement upon return to the
Philippines in 1984.
Proof of this was given by Moises’ brother, Cerefino Miat, who said
testified the original agreement that Paco property would go to Moises’
sons. This was reiterated at the death bed of Moises’ wife and affirmed
upon Moises’ return to the Philippines.
The Paco property, being the land in dispute, was paid for on an
installment basis from May 17, 1977 to December 14, 1984. Full
payment was made on the latter date and title was secured under Moises
name as widower.
Romeo and Alexander, sons of Moises, lived on the Paco property with
their wives and paid its realty taxes and fire insurance premiums.
Alexander and his wife, however, left the property in August 1985 for
personal reasons.
February 1988, Romeo learned from his godmother in his wedding, Mrs.
Rosalina Castro, mother of petitioner Virgilio Castro, that she had given
Moises P30,000.00 as downpayment for the sale by Moises of the Paco
property to her son Virgilio.
April 1988, Alexander agrees to sell his share of the Paco property for
P42,750.00; a partial payment was made in the sum of P6,000 by Romeo
but Alexander did not execute a deed of assignment in favor of his
brother because “he had lots of work to do and the title was already in
Romeo’s possession.”
Romeo had possession of the title of the Paco property because he
borrowed it from his father when he mortgaged the land to his friend
Lorenzo. But when Moises ran into financial difficulties, he mortgaged
for P30,000.00 the Paco property to parents of petitioner.
December 1, 1988, Romeo and petitioner Virgilio met in MTC Manila to
discuss status of Paco property. On the 16th, a letter from petitioner’s
lawyer informed Romeo that the Paco property had been sold to Virgilio
by Moises by virtue of a deed of sale dated Dec. 5, 1988 for P95,000.00.
Buyer, petitioner, Virgilio admitted that the title of the property was
with
Romeo but bought it anyway on the assurance of Moises that he’d be
able to retrieve it from his son.
Romeo files in the RTC action to nullify sale and compel Moises and
Alexander to execute deed of conveyance/assignment. RTC ordered (1)
Alexander to pay the remaining balance due his brother, (2) Romeo to
recognize sale made by Moises, (3) dismissal of defendant’s
counterclaim and (4) defendants to pay the costs of suit.
Both parties appealed to the CA which modified the decision by saying
that: (1) the deed of sale was nullified, (2) Moises and Alexander had to
execute a deed of conveyance, and (3) for defendants to pay cost of suit
(as applied for by the petitioner). Virgilio subsequently brings the action
to the SC
ISSUE :
1. Whether the Paco property is conjugal or capital (TOPIC)
2. Whether valid oral partition between Moises and his sons involving
the said property is valid.
3. Whether Castro spouses were buyers in good faith.
RATIO / HELD :
1. Conjugal property. Although petitioners allege that property was
paid for by Moises and at the time it was paid, his wife had long been
dead, the SC disagrees on the grounds of the new Civil Code, which was
applicable because marriage was celebrated before FC:
Art 153 (1) “The following are conjugal partnership property: (1) Those
acquired by onerous title during the marriage at the expense of the
common fund, whether the acquisition be for the partnership, or for only
one of the spouses;
Records show that property was acquired by onerous title during the
marriage out of the common fund. It is clearly conjugal property.
Petitioners also overlook Article 160 of the New Civil Code. It provides
that “all property of the marriage is presumed to belong to the conjugal
partnership, unless it be proved that it pertains exclusively to the
husband or to the wife.” This article does not require proof that the
property was acquired with funds of the partnership. The presumption
applies even when the manner in which the property was acquired does
not appear.
In the case at bar (as opposed to petitioner’s reliance on Lorenzo v.
Nicolas), Moises and Concordia bought the Paco property during their
marriage — Moises did not bring it into their marriage, hence it has to be
considered as conjugal.
downpayment for the purchase of his share in the Paco property.
Secondly, Romeo and his witnesses, Ceferino Miat and Pedro Miranda,
who testified regarding the sale of Alexander’s share to Romeo, were
intensely questioned by petitioners’ counsel.
3. No. In the case at bench, the said spouses have actual knowledge of the
adverse claim of plaintiff-appellant. The most protuberant index that
they are not buyers in good faith is that before the sale, Virgilio Castro
talked with Romeo Miat on the supposed sale. Virgilio testified that
together with Romeo, Alexander and Moses Miat, they went to Judge
Anunciacion of Manila in order to find out if Romeo has a right over the
property. Romeo told Virgilio in that meeting that Romeo has a right
over the Paco property by virtue of an oral partition and assignment.
Virgilio even admitted that he knew Romeo was in possession of the title
and Romeo then insisted that he is the owner of the property.
Virgilio Castro is further aware that plaintiff is in possession of the
property, they being neighbors. A purchaser who was fully aware of
another person’s possession of the lot he purchased cannot successfully
pretend to be an innocent purchaser for value.”

12

2. Yes. The validity of the agreement is apparent in (a) latter of the

father to his sons (the one which stated that he didn’t favor any of his
sons), (b) the testimony (see above) of Moises’ brother, Ceferino, and the
oral agreement between the brothers to divide the property between
themselves (attested to by extended Family members).

Oral partition between Romeo and Alexander is not covered by the

Statute of Frauds. It is enforceable for two reasons. Firstly, Alexander
accepted the six thousand (P6,000.00) pesos given by Romeo as
95. Ramos Vs. Director Of Land
Facts:
 In 1882, Restituto Romero y Ponce apparently gained possession
of a tract of land located in the municipality of San Jose, Province of
Nueva Ecija.
 Ponce obtained a possessory information title of the land (by
taking advantage of the Maura Law or Royal Decree of Feb. 13,
1994) and registered the land in 1896.
 In 1907, the part of the land (Parcel 1) was sold by Ponce to
petitioner Ramos and to his wife Ambrosia Salamanca.
 Ramos instituted appropriate proceedings to have his title
registered.  6. All persons who by themselves or their predecessors and interest
 The Director of Lands and Director of Forestry opposed the
application on the following grounds: Ramos had not acquired a
good title from the Spanish government; The first parcel was forest
land.
 RTC and CA ruled against Ramos.  twenty-sixth day of July, nineteen hundred and four (July 26, 1904),
 It has been seen however that the predecessor in interest to
Ramos at least held this tract of land under color of title.
Issue: Is that actual occupancy of a part of the land described in the
instrument giving color of title sufficient to give title to the entire tract of
land?  There was no satisfactory evidence to support the claim that the
Held: YES.
The doctrine of constructive possession indicates the answer. The
general rule is that the possession and cultivation of a portion of a tract
under claim of ownership of all is a constructive possession of all, if the
remainder is not in the adverse possession of another.
Ramos has a color of title, is in good faith and had been in OPN
possesion
The claimant has color of title; he acted in good faith; and he has had
open, peaceable, and notorious possession of a portion of the property,
sufficient to apprise the community and the world that the land was for
his enjoyment. 
Possession in the eyes of the law does not mean that a man has to have
his feet on every square meter of ground before it can be said that he is
in possession. Ramos and his predecessor in interest fulfilled the
requirements of the law on the supposition that he premises consisted of
agricultural public land.
Important law: Act NO. 926
Subsection 6 of section 54, of Act No. 926, entitled The Public Land Law,
as amended by Act No. 1908, reads as follows: 
have been in the open, continuous, exclusive, and notorious possession
and occupation of agricultural public lands, as defined by said Act of
Congress of July 1, 1902, under a bona fide claim of ownership except as
against the Government, for a period of 10 years next preceding the
except when prevented by war or force majeure, shall be conclusively
presumed to have performed all the conditions essential to a
government grant and to have received the same, and shall be entitled to
a certificate of title to such land under the provisions of this chapter.
land is a forest land
Forest reserves of public land can be established as provided by law.
When the claim of the citizen and the claim of the Government as to a
particular piece of property collide, if the Government desires to
demonstrate that the land is in reality a forest, the Director of Forestry
should submit to the court convincing proof that the land is not more
valuable for agricultural than for forest purposes. 
Great consideration, it may be stated, should, and undoubtedly will be,
paid by the courts to the opinion of the technical expert who speaks with
authority on forestry matters. But a mere formal opposition on the part
of the Attorney-General for the Director of Forestry, unsupported by
satisfactory evidence will not stop the courts from giving title to the
claimant.
Ruling:
 Ramos proved a title to the entire tract of land for which he
asked registration, under the provisions of subsection 6, of section
54, of Act No. 926, as amended by Act No. 1908, with reference to
the Philippine Bill and the Royal Decree of February 13, 1894, and
Ponce’s possessory information.
 RTC shall register in the name of the applicant the entire tract in
parcel No. 1, as described in plan Exhibit A.
Ramos Vs. Director Of Land
In 1882, Restituto Romero gained possession of a considerable tract of
land in the municipality of San Jose, Province of Nueva Ecija. He later
obtained a possessory information title to the land thru a Royal Decree
and registered the same in 1896. In 1907, Parcel No. 1, which was
included within the limits of the possessory information title of Restituto
Romero, was sold to petitioner Cornelio Ramos and his wife Ambrosia
Salamanca.
Ramos instituted appropriate proceedings to have his title registered.  registration.
However, it is admitted that Ramos has cultivated only about one fourth
of the entire tract. The Director of Lands opposed Ramos’ registration on
the ground that he had not acquired a good title. The trial court then
excluded parcel No. 1 from registration.  Ramos contends that his
predecessor-in-interest, Restituto Romero, held the land under color of
title.
ISSUE: Is the actual occupancy of a part of the land described in the
instrument giving color of title sufficient to give title to the entire tract of
land?
The doctrine of constructive possession indicates the answer.  The
general  rule is that the possession and cultivation of a portion of a tract
under claim of ownership of all  is a constructive possession  of all, if the
remainder is not in the adverse possession of another.  Here, it is only
necessary to apply the general rule. In this case, Ramos has color of title;
he acted in good faith; and he has had open, peaceable, and notorious
possession of a portion of the property, sufficient to apprise
the community and the world that the land was for his enjoyment. 
Possession in the eyes of the law does not mean that a man has to have
his feet on every square meter of ground before it can be said that he is
in possession.  Ramos and his predecessor in interest fulfilled the
requirements of the law on the supposition that the premises consisted
of agricultural public land.
When  the claim of the citizen and the  claim of the Government as to a
particular piece of property collide, if the Government desires to
demonstrate that the land is in reality a forest, the Director of Forestry
should submit to the court convincing proof that the land is not more
valuable for agricultural than for forest purposes.  A mere formal
opposition on the part of the Attorney-General for the Director of
Forestry, unsupported by satisfactory evidence will not stop the courts
from giving title to the Ramos.
Ramos has proved a title to the entire tract of land for which he asked
Hence, the entire tract in Parcel No. 1 shall be registered in the name of
the Ramos.
96. Director of Lands vs. Court of Appeals

The heirs of Bruno Cabauatan registered 25 hectares of land in 1934. In

1937, they tried to register 128 more hectares. Petitioners are
homesteaders who claim rights to the 138 hectares.

Ruling

The registration of the 128 hectares cannot be granted.

• Heirs of Cabauatan claim that since

they were in actual possession of the 25 hectares, they must be deemed

to have constructive possession of the

128 hectares.
• The rule on constructive possession

does not apply to this case because the major portion of the disputed
128 hectares has been in the adverse possession of homesteaders and
their heirs and is still part of the public domain until the patents are
issued.
97. PLEASANTVILLE DEVELOPMENT CORPORATION VS. COURT OF
APPEALS
G.R. NO. 79688 253 SCRA 10 FEBRUARY 1,
1996
PONENTE: PANGANIBAN, J.

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

Facts: Edith Robillo purchased from Pleasantville Development

Corporation, herein petitioner a parcel of land at Pleasantville
Subdivision, Bacolod City. The property was designated as Lot 9, Phase
II. In 1975, herein respondent Eldred Jardinico bought the said subject
lot from the former purchaser. Eldred later discovered that the property
he purchased had improvements introduced therein by respondent
Wilson Kee.
Kee on the other hand bought on installments Lot 8 of the same
subdivision from C.T. Torres Enterprises, Inc. (CTTEI) which is the
exclusive real estate agent of the petitioner. Under the contract Kee was
allowed to take possession of the property even before full payment of
the price. CTTEI through an employee, Zenaida Octaviano accompanied
Kee’s wife Donabelle to inspect Lot No. 8. Octaviano however mistakenly
pointed towards Lot 9. Hence spouses Kee had their residence, an auto
repair shop, a store and other improvements constructed on the wrong
lot.

Upon discovery of the blunder both Kee and Jardinico tried to

reach an amicable settlement but they failed. Jardinico demanded that
the improvements be removed but as Kee refused, Jardinico filed a
complaint for ejectment with damages against Kee at the Municipal Trial
Court in Cities (MTCC) of Bacolod City. Kee filed a third-party complaint
against herein petitioner and CTTEI.
98. Kasilag v. Rodriguez remedies against the qualification of registrars, and the possibility of
error is remote under such circumstances; but unfortunately, private
documents and even verbal agreements far exceed public documents in
G.R. No. 46623, 7 December 1939
number, while no one should be ignorant of the law, the truth is that
even we who are called upon to know and apply it fall into error not
FACTS:
infrequently. However, a clear, manifest, and truly unexcusable
ignorance is one thing, to which undoubtedly refers article 2, and
This is an appeal taken by the defendant-petitioner (Kasilag) from the
another and different this is possible and excusable errors arising from
decision of the Court of Appeals which modified that rendered by the
complex legal principles and from the interpretation of conflicting
court of First Instance of Bataan. The said court held: that the contract is
doctrines
entirely null and void and without effect; that the plaintiffs-respondents
(Rodriguez, et.al.), then appellants, are the owners of the disputed land,
Even ignorance of the law may be based upon error of fact, or better still,
with its improvements, in common ownership with their brother Gavino
ignorance of a fact is possible as to the capacity to transmit and as to the
Rodriguez, hence, they are entitled to the possession thereof; that the
intervention of certain persons, compliance with certain formalities and
defendant-petitioner should yield possession of the land in their favor,
appreciation of certain acts, and error of law is possible in the
with all the improvements thereon and free from any lien.
interpretation of doubtful doctrines.
The parties entered into a contract of loan to which has an
Gross and inexcusable ignorance of law may not be the basis of good
accompanying accessory contract of mortgage. The executed accessory
faith, but possible, excusable ignorance may be such basis. It is a fact that
contract involved the improvements on a piece land, the land having
the petitioner is not conversant with the laws because he is not a lawyer.
been acquired by means of homestead. Petitioner for his part accepted
In accepting the mortgage of the improvements he proceeded on the
the contract of mortgage.
well-grounded belief that he was not violating the prohibition regarding
the alienation of the land. In taking possession thereof and in consenting
Believing that there are no violations to the prohibitions in the alienation
to receive its fruits, he did not know, as clearly as a jurist does, that the
of lands Petitioner, acting in good faith took possession of the land. To
possession and enjoyment of the fruits are attributes of the contract of
wit, the Petitioner has no knowledge that the enjoyment of the fruits of
antichresis and that the latter, as lien, was prohibited by section 116.
the land is an element of the credit transaction of Antichresis.
These considerations again bring us to the conclusion that, as to the
petitioner, his ignorance of the provisions of section 116 is excusable
ISSUE:
and may therefore, be the basis of good faith.We do not give much
importance to the change of the tax declaration, which consisted in
Whether the petitioner should be deemed a possessor in good faith?
making the petitioner appear as the owner of the land, because such an
act may only be considered as a sequel to the change of possession and
RULING:
enjoyment of the fruits by the petitioner, to about which we have stated
that the petitioner’s ignorance of the law is possible and excusable. We,
When the acquisition appears in a public document, the capacity of the
therefore, hold that the petitioner acted in good faith in taking
parties has already passed upon by competent authority, and even
possession of the land and enjoying its fruits.
established by appeals taken from final judgments and administrative

The MTCC found that the error was attributable to CTTEI also
since at present the contract with Kee has rescinded for Kee’s failure to
pay installments. Kee no longer had any right over the subject property
and must pay rentals for its use. The Regional Trial Court (RTC) of
Bacolod City ruled that petitioner and CTTEI were not at fault or were
not negligent. It argued that Kee was a builder in bad faith. Even if
assuming that he was in good faith, he was no longer so and must pay
rentals from the time that he was given notice to vacate the lot. The
Court of Appeals ruled that Kee was a builder in good faith as he was
unaware of the mix-up when he constructed the improvements. It was in
fact due to the negligence and wrongful delivery of CTTEI which
included its principal the herein petitioner. It further ruled that the
award of rental was without basis.
was delivered to him. Petitioner further contends that Kee was negligent
as a provision in the Contract of Sale on Installment stated that the
vendee must have personally examined the property and shall bear on
his own the consequential expenses in the changes that may happen
thereon. The court held that such provision cannot be interpreted as a
waiver of the vendee’s right to recover damages resulting from
petitioner’s negligence. Such interpretation of the waiver is contrary to
law and public policy and cannot be allowed. Petitioner cannot claim and
excuse itself from liability by claiming that it was not directly involved in
the delivery of the property. The principal must be responsible for the
acts of the agent done within the scope of his authority. CTTEI was the
sole real estate representative of the petitioner when the delivery was
made. Wilson Kee is therefore declared a builder in good faith. Petitioner
and respondent CTTEI are declared solidarily liable for damages due to
negligence. The award of rentals to Jardinico is dispensed with.

Pending the resolution of the case at the Court of Appeals

Jardinico and Kee entered into a deed of sale, wherein Lot 9 was sold to
Kee. In the said deed a provision stating that regardless of the outcome
of the decision, such shall not be pursued by the parties and shall be
considered dismissed and without effect. The appellate court was not
informed of this deal.

Issue: Whether or not a lot buyer who constructs improvements on the

wrong property erroneously delivered by the owner’s agent, a builder in
good faith?

Held: Yes. Article 527 of the Civil Code provides the presumption that
petitioner has the burden of proving that Kee was a builder in bad faith.
Kee may be made liable for the violation of the contract with CTTEI but
this may not be used as a basis of bad faith and as a sufficient ground to
negate the presumption of good faith. Jardinico is presently only allowed
to file a complaint for unlawful detainer. Good faith is based on the belief
of the builder that the land he is building on is his and his ignorance of
any flaw or defect in is title. Since at the time when Kee constructed his
improvements on Lot 8, he was not aware that it was actually Lot 9 that
99. Banco Español-Filipino vs. Peterson
POSSESION
Banco Espanol Filipino v Peterson (1907)
Facts: On March 4, 1905, Banco Espanol Filipino (BEP) executed a
contract of loan in favor of Francisco Reyes for P141 702.00. Reyes was
already indebted to the bank for P84 415.00. His total debt was
therefore P226 117.38. To secure payment of the P141k and the P84k,
Reyes executed a public instrument mortgaging several of his properties
and ledging part of his personal property to BEP (P90 591.75 worth of
wines, liquors and canned goods), which were stored at a warehouse he
rented in Manila. BEP and Reyes agreed that the goods should be
delivered to Ramon Garcia (depositary) for safekeeping. Reyes turned
over the goods to R. Garcia by giving him the warehouse keys. On
September 29, 1905, BEP and Reyes substituted Luis Sierra in place of R.
Garcia as the depositary. On October 19, 1905, Juan Garcia (yes, related
to Ramon) brought an action against Francisco Reyes and Ramon
Agtarat. CFI Manila ruled against Reyes and Agtarat for P15 000.00. On
the same day, Sheriff James Peterson entered the warehouse where the
goods pledged to BEP were stored under the custody of the depositary,
Sierra. Peterson levied upon P30 000 worth of the goods pledged to the
bank, depriving the latter of possession of the same, as stipulated in the
March 4 contract of loan.
Issues
1. Was the contract of pledge between BEP and Reyes to secure a
loan valid?
2. Was Reyes still in possession of the pledged property, thereby
making the contract defective?
Ruling:
The contract was valid. Reyes was no longer in possession of the pledged
property. BEP had symbolic possession of the same.
The contract complies with all the requisites of a valid pledge contract,
as prescribed by the Civil Code:
1. The property was pledged to secure a debt
2. The date of execution, the terms of the pledge, and the property
pledged appeared in a public instrument
3. The property pledged was placed in the hands of a third person (in
this case, Sierra) by common consent of the debtor and creditor, under
the supervision of an agent (in this case, Rodriguez) of the bank
Reyes, after the pledge, parted with the possession of his personal
property, which was delivered to a third person (R. Garcia, and
subsequently, Sierra) who would take care of them for BEP. Sierra was
the third person appointed by common consent of BEP (creditor) and
Reyes (debtor), to hold possession over the goods pledged in favor of the
bank under the direct supervision of Rodriguez, an agent specifically
appointed by the bank. The contract in question was, therefore, a perfect
contract of pledge under articles 1857 and 1863 of the Civil Code, it
having been conclusively shown that the pledgee (BEP) took charge and
possession of the goods pledged through a depositary (Sierra) and a
special agent (Rodriguez) appointed by it, each of whom had a duplicate
key to the warehouse wherein the said goods were stored, and that the
pledgee (BEP), itself, received and collected the proceeds of the goods as
they were sold. The legality of the pledge was not affected by the fact
that the goods remained in the warehouse formerly rented by Reyes the
pledgor. This is because after the pledge had been agreed upon, and after
the depository appointed with common consent of the parties had taken
possession of the said property, Reyes could no longer dispose of the
same because BEP was the only party allowed to do so through Sierra
and Rodriguez. The symbolic transfer of the goods through delivery of
the keys to the warehouse where the goods were stored was sufficient
evidence to show that Sierra, the depositary appointed by both BEP and
Rodriguez, was legally placed in possession of the goods. Since the
contract of pledge was valid, BEP had a better right to the goods
compared to J. Garcia. The Court ordered either the return of the
improperly levied goods, or the payment of their value, P30 000.

100. SPS. MACASAET vs SPS. MACASAET G.R. 154391-92 Sept. 30,
2004
Facts:
 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.
 On December 10, 1997, the parents filed with the MTC of Lipa an
ejectment suit against the children.
 Respondents alleged that they were the owners of 2 parcels of land,
situated at Banay-banay, Lipa City; that by way of a verbal lease
agreement, Ismael and Teresita occupied these lots in Mar. 1992 and
used them as their residence and the situs of their construction
business; and that despite repeated demands, petitioners failed to
pay the agreed rental of P500.
 Ismael and Teresita denied the existence of any verbal lease
agreement. They claimed that respondents had invited them to
construct their residence and business on the subject lots in order
that they could all live near one another, employ marivic, the sister of
Ismael, and help in resolving the problems of the family.
 They added that it was the policy of respondents to allot the land
they owned as an advance grant of inheritance in favor of their
children.
 The MTCC ruled in favor of respondents and ordered petitioners to
vacate the premises. It opined that Ismael and Teresita had occupied
the lots, not by virtue of a verbal lease agreement, but by tolerance of
Vicente and Rosario.
 As their stay was merely tolerance, petitioners were necessarily
bound by an implied promise to vacate the lots upon demand.
 On appeal, the regional trial court updheld the findings fo the MTCC.
However, the RTC allowed the respondents to appropriate the
building and other improvements introduced by petitioners, after
payment of the indemnity provided for by Art. 448 in relation to Art.
546 and 548 of the NCC.
 The CA sustained the finding of the two lower courts that Ismael and
Teresita had been occupying the subject lots only by the tolerance of
Vicente and Rosario. Citing Calubayan v. pascual, the CA further
ruled that petitioners status was analogous to that of a lessee or a
tenant whose term of lease had expired, but whose occupancy
continued by tolerance of the owner.
 Consequently , in ascertaining the right of the petitioners to be
reimbursed for the improvements they had introduced on
respondents properties, the appellate court applied the Civil Codes
provisions on lease.
Issue:
W.O.N. the courts should fix the duration of possession.
Held:
 That Ismael and Teresita had a right to occupy the lots is therefore
clear, the issue is the duration of possession. In the absence of a
stipulation on this point, Art. 1197 of the civil Code allows the courts
to fix the duration or the period.
 Article 1197. If the obligation does not fix a period, but from its
nature and the circumstances it can be inferred that a period was
intended, the courts may fix the duration thereof.
 The courts shall also fix the duration of the period when it depends
upon the will of the debtor.
 Article 1197, however, applies to a situation in which the parties
intended a period. Such qualification cannot be inferred from the
facts of the present case.
 The mere failure to fix the duration of their agreement does not
necessarily justify or authorize the courts to do so
 It can be safely concluded that the agreement subsisted as long as
the parents and the children mutually benefited from the
arrangement.
 Effectively, there is a resolutory condition in such an agreement.
 Their possession which was originally lawful became unlawful when
the reason therefore – love and solidarity – ceased to exist between
them.

101. EDUARDO CUAYCONG, ET AL., plaintiffs-appellees,  the plaintiffs prayed for a judgment that they are entitled to use the road
vs.
RAMONA BENEDICTO, ET AL., defendants-appellants.
G.R. No. L-9989             such use.
March 13, 1918
FISHER, J.:
Defendants are the owner of Nanca-Victorias road situated between the
southern boundary of the Hacienda Toreno and the barrio of Nanca, of
the municipality of Seravia, and the appellees are the lessees of part of
said haciendas. The Nanca-Victorias road has been in existence for at
least forty years. the hacenderos located in the southwestern section of
Victorias and the public generally passed over it freely and that it was
used for all purposes of transportation of farm produce, animals, etc. and
by pedestrians as well as carromatas and other conveyances without
break or interruption until two or three years ago when the defendants
announced that the road was private and that those who wished to pass
over it with sugar carts would be obliged to pay a toll of ten centavos —
all other vehicles, it appears, were permitted to pass free charge. This
arrangement seems to have existed during the years of 1911 and 1912
and part of 1913, the money being collected apparently from some
hacenderos and not from others. There is some reason to believe from
the evidence presented by defendants themselves that the practice of
making these payments to hacienda 'Toreno' originated in an attempt to
raise a fund for the repair of the road. There is no evidence that any
other hacenderos between Nanca and Victorias or any other person
made any attempt to close the road or to collect toll. On the contrary the
road appears to have been repaired by the hacenderos when it needed
repairing and everyone used it on equal terms until the defendants in
1910 or 1911 interposed the objection that the road in dispute was
private. This we think is a fair deduction from the evidence and although
it is asserted that toll was collected at an earlier date by the late Leon
Montinola, brother of the defendant Ruperto Montinola, there is no
tangible evidence that this was so and that toll has been paid only during
the years of 1911, 1912, and part of 1913. Upon these averments of fact
in question as they have been using it in the past, and that a perpetual
injunction be issued against plaintiffs restraining them from impending
Upon the filing of the complaint, plaintiffs moved the court to issue a
preliminary injunction restraining defendants from interfering with the
use of the road during the pendency of the suit, which motion was
granted by the court.
ISSUE:
Wheter or Not the Nanca-Victorias road at the point at which it
traverses the Hacienda Toreno a public highway or not?
HELD:
The trial judge, in holding that the road in question is public, bases in
conclusion upon the fact, which he deems to have been proven, that the
road has been in existence "from time immemorial," and had been
"continiously used as a public road . . . and open to public as such for
thirty or forty years . . . until . . . the defendants undertook to claim it as
private and to collect toll for the passage of carts." There is no doubt that
for the past thirty or forty years a road has existed between the former
site of the town of Victorias and the barrio of Nanca, of the municipality
of Seravia, and that this road crosses defendants' hacienda.
The court also held that it appears from the government grant issued in
1885 to the original owner of the hacienda adjacent to the Hacienda
Toreno on its western boundary, that the Nanca-Victorias road at that
time separated that estate from the Jalbuena Hacienda, and that these
facts constitute "circumstantial evidence that the road was in existence
in 1885." We have examined the document to which the court refers, and
we agree that the road in question existed in 1885; but we do not believe
that the document in question proves that the road was public highway.
There is admittedly no evidence to show that the land occupied by the
road here in question was any time conveyed to the general government
or any of its political subdivisions by the present or any of the former
owners of the Hacienda Toreno. There is no evidence, even remotely,
tending to show that the road existed prior to the time when the
property now known as the Hacienda Toreno passed from the State into
private ownership. The record fails to disclose any evidence whatever
tending to show that the Government has at any time asserted any right
or title in or to the land occupied by the road, or that it has incurred any
expense whatever in its upkeep or construction. The Civil Code defines
as public roads those which are constructed by the State (art. 339), and
as provincial and town roads those "the expense of which is borne by
such towns or provinces." (Civil Code, art. 344.) While it is not contended
that this definition is exclusive, it does show that during the Spanish
regime, under normal conditions, roads which were public were
maintained at the public expense, and that the fact that at no time was
any expense incurred by the Government with respect to the road here
in question tends strongly to support the contention of the defendants
that it is private way.
The evidence shows that the repairs were made by the owners of the
estates benefited by the road, and by their laborers, as a pure voluntary
act for their own convenience and interest. There being no evidence of a
direct grant to the government of the land occupied by the road in
question or that any Government funds or labor were expended upon it,
the question presents itself whether the use to which the road has been
put was such as to justify the conclusion of the lower court that it has
become public property. But in this case there is no such evidence, and
the claims of plaintiffs, whether regarded as members of the public
asserting a right to use the road as such, or as persons claiming a private
easement of way over the land of another must be regarded as resting
upon the mere fact of user.
If the owner of a tract of land, to accommodate his neighbors or the
public in general, permits them to cross his property, it is reasonable to
suppose that it is not his intention, in so doing, to divest himself of the
ownership of the land so used, or to establish an easement upon it and
that the persons to whom such permission, tacit or express, is granted,
do not regard their privilege of use as being based upon an essentially
revocable license. If the use continues for a long period of time, no
change being made in the relations of the parties by any express or
implied agreement, does the owner of the property affected lose his right
of revocation? Or, putting the same question in another form, does the
mere permissive use ripen into title by prescription?
The facts established by the evidence it does not appear that the road in
question is a public road or way. We are also of the opinion that plaintiffs
have failed to show that they have acquired by prescription a private
right of passage over the lands of defendants. The supreme court of
Spain has decided that under the law in force before the enactment of
the Civil Code, the easement of way was discontinous, and that while
such an easement might be acquired by prescription, it must be used in
good faith, in the belief of the existence of the right, and such user must
have been continuous from time immemorial. In the appealed decision
the court below says that the plaintiffs and their predecessors made use
of the road in question "from time immemorial," but there is no evidence
whatever in the record to sup[port this finding, although it is true that
the evidence shows the existence of the road and its use by the
While in the allegations from the plaintiffs' complaint it might be
inferred that it was their purpose to seek to impose upon the defendants
the easement to which arts. 564 et seq. of the Civil Code relate, that
purpose was evidently abandoned, and the case was tried upon a wholly
different theory. Proof was offered to show that the right of passage
across defendants' land is necessary to enable plaintiffs to get their
products to market, but there was no offer on their part to pay
defendants the indemnity required by section 564.
102. Yu vs. Honrado

Facts

Sps. Yu owned a junk shop. They purchased 42 metric tons of scrap

engine blocks from Refuerzo. Said Refuerzo allegedly obtained the scrap
from Marcelo Steel Corp. through fraud/swindling. The public
prosecutor did not find any collusion between the Yus and Refuerzo,
who was charged with estafa. Controversy in this case revolves around
who is now the rightful possessor of the scrap: Marcelo, the original
owner, or sps. Yu, the buyers in good faith. Alternatively, who should
bear the loss?

Issue

Ruling

The Yus purchased the scrap under a sales invoice that seemed to have
been made in the ordinary course of business. The fact that an estafa
case was filed against the vendor who sold the scrap to the Yus will not
disturb them in possession of the movables.

As to the second issue, as between two innocent persons, the one who
must suffer the consequences is the one who made the breach of trust
possible. In this case, it is Marcelo.

The acquirer and possessor in good faith of a movable is entitled to be

respected and protected in his possession, as if he were the true owner
thereof, until a competent court rules otherwise. (cited from Chua Huai v
Kapunan Jr.)
103. Cordero vs. Cabral
CORDERO VS. CABRAL
No. L-36789. July 25, 1983
FACTS:
 Felipa Cordero and her children Mauro, Casimiro and Elisea
Ocampo dued Victoria Cabral, Alejandro Berboso and Dalmacio
Montaos in CFI
 TCT 14513 in the name of Gregorio Ocampo and Tax declaration
of 2819 containing 78,181 sq meters was in possession of the
plaintiffs after his death.
 Later plaintiffs found out that 4,303 square meters was
possessed by the defendants herein, claiming the ownership of
the said portion while her co-defendants co-possessed the same
as her tenants.
 Relocated in the presence of the defendants’ representatives and
it
was found and/or determined that the aforesaid portion of land
with the area of 4,303 square meters, more or less, was a part of
the plaintiffs’ land with T.C.T. No. 14513;
 That even after the said relocation the defendant Victoria P.
Cabral persisted and still persist in her claim of ownership over
the said portion and her codefendants persisted and still persist
in recognizing her as the owner thereof instead of the plaintiffs;
 In their answer defendants alleged that they have no knowledge
or information sufficient to form a belief as to the truth of the
allegations.
 Granting but without admitting, that the defendant Cabral and
her predecessors in interest have been in possession of this
portion of land with an area of 4,303 square meters, more or less
for more than 50 years, does she mean to imply now that she
acquires ownership over the same by virtue of ‘prescription’?
 Trial court dismissed the plaintiff’s complaint for lack of proof.
 CA found out that there was an oral sale between Cabral and Mr
Ocampo but did not materialized and was never discussed in the
trial court.
 CA ruled in favor of the defendants.
ISSUE:
Whether or not the possession through an oral sale was valid?
HELD:
No. The judgment of the Court of Appeals is reversed and another one
rendered in that the defendants shall vacate and surrender the land in
question to the plaintiffs; and the defendants shall also account for the
fruits thereof pursuant to Article 549 of the Civil Code from the service
of the summons.
ANALYSIS:
The fact is that the defendant Victoria P. Cabral or any of her
predecessors in interest did not sincerely and honestly believe that they
were the owners of this portion of property. In fact they did not have and
do not have any kind of title or any kind of document, either public or
private, over this property and they did not even have this property
declared in their names for taxation purposes.
Granting, but without admitting, that the title to this property was
obtained either by error or fraud yet the defendant Victoria P. Cabral can
have no valid claim against the plaintiffs because she has never been the
owner of said property and also because the plaintiffs’ predecessor, Mr.
Gregorio Z. Ocampo, acquired this property as ‘an innocent purchaser, in
good faith and for value.’

In addition to the issue that was not discussed in the lower court, no
question will be entertained on appeal unless it has been raised in the
court below and it is within the issues made by the parties in their
pleadings.

CONCLUSION:
The defendants, by their own admission, are in possession of the
disputed land. There is no evidence that they were possessors in bad
faith. However, their good faith ceased when they were served with
summons to answer the complaint.

In this case, the Court of Appeals erred when it rendered a decision

based on a ground which was not litigated in the trial court and which
could not have been raised on appeal. That the supposed oral contract of
sale was never an issue is demonstrated by the following: 1. The
pleadings of the parties have been purposely reproduced in full above. It
can be seen therefrom that no issue in respect of the supposed oral sale
actually emerged 2. The decision of the trial court is absolutely silent on
the supposed oral contract of sale. 3 The plaintiffs who appealed the
decision of the trial court to the Court of Appeals did not make
104. Fabie v. David
G.R. No. L-123, December 12, 1945
Ozaeta, J.
FACTS:
Josefa Fabie is the usufructuary of the income of certain houses
located at 372-376 Santo Cristo, Binondo, and 950-956 Ongpin, Santa
Cruz, Manila, under the ninth clause of the will of the deceased Rosario
Fabie y Grey. The owner of Santo Cristo property is the respondent Juan
Grey. Litigation arose between Josefa Fabie as plaintiff and Juan Grey as
defendant and the owner of the Ongpin property as intervenors,
involving the administration of the houses mentioned in clause 9 of the
will referred to above.
In June 1945 Josefa Fabie commenced an action of unlawful
detainer against Ngo Boo Soo (who says that his correct name is Ngo
Soo), alleging that the defendant is occupying the premises located at
372-376 Santo Cristo on a month-to month rental payable in advance
not later than the 5th of each month; that she is the administratrix and
usufructuary of said premises; that the defendant offered to pay P300
monthly rent payable in advance not later than the 5th of every month,
beginning the month of April 1945, for the said of premises including the
one door which said defendant, without plaintiff’s consent and contrary
to their agreement, had subleased to another Chinese, but plaintiff
refused, based on the fact that the plaintiff very badly needs the said
house to live in, as her house was burned by the Japanese on the
occasion of the entry of the American liberators in the City; that
defendant was duly notified to leave the said premises, but he refused;
and she prayed for judgment of eviction and for unpaid rentals.
The defendant answered alleging that he was and since 1908 had
been a tenant of the premises in question, which he was using and had
always used principally as a store and secondarily for living quarters;
that he was renting it from its owner and administrator Juan Grey; that
plaintiff is merely the usufructuary of the income therefrom, and by
agreement between her and said owner, her only right as usufructuary
of the income is to receive the whole of such income; that she has no
right or authority to eject tenants, such right being in the owner and
administrator of the house, Juan Grey; that plaintiff has never had
possession of said property; that defendant’s lease contract with the
owner of the house is for 5-year period, with renewal option at the end
of each period, and that his present lease due to expire on December 31,
1945; that on June 1, 1945, defendant made a written offer to plaintiff to
compromise and settle the question of the amount of rent to be paid by
defendant but said plaintiff rejected the same for no valid reason
whatever and instituted the present action; that the reason plaintiff
desires to eject defendant from the property is that she wishes to lease
the same to other persons for a higher rent, ignoring the fact that as
usufructuary of the income of the property she has no right to lease the
property.
ISSUE:
Who is entitled to administer the property subject matter of this
case and who should be the tenant?
HELD:
The usufructuary has the right to administer the property in
question. All the acts of administration — to collect the rents for herself,
and to conserve the property by making all necessary repairs and paying
all the taxes, special assessments, and insurance premiums thereon —
were by court judgment vested in the usufructuary. The pretension of
the respondent Juan Grey that he is the administrator of the property
with the right to choose the tenants and to dictate the conditions of the
lease is contrary to both the letter and the spirit of the said clause of the
will, the stipulation of the parties, and the judgment of the court. He
cannot manage or administer the property after all the acts of
management and administration have been vested by the court, with his
consent, in the usufructuary. He admitted that before said judgment he
had been collecting the rents as agent of the usufructuary under an
agreement with the latter. As long as the property is properly conserved
and insured he can have no cause for complaint, and his right in that
regard is fully protected by the terms of the stipulation and the judgment
of the court above mentioned. To permit him to arrogate to himself the
privilege to choose the tenant, to dictate the conditions of the lease, and
to sue when the lessee fails to comply therewith, would be to place the
usufructuary entirely at his mercy. It would place her in the absurd
situation of having a certain indisputable right without the power to
protect, enforce, and fully enjoy it.

105. Board of Assessment Appeals-Zamboanga del Sur v. Samar
Mining Co., Inc. (Emerson)
THE BOARD OF ASSESSMENT APPEALS OF ZAMBOANGA DEL SUR
and PLACIDO L. LUMBAY, in his capacity as PROVINCIAL ASSESSOR
OF ZAMBOANGA DEL SUR, petitioners,
vs.
SAMAR MINING COMPANY, INC. and the COURT OF TAX APPEALS,
respondents.
G.R. No. L-28034 - February 27, 1971 – Zaldivar, J.
SUMMARY: By virtue of a government lease, a mining company built a
road on alienable public land in Zamboanga del Sur. The provincial
assessor sent a letter of assessment of real estate tax to the company,
who appealed the same to the Board of Assessment Appeals, which in
turn upheld the assessment. The company appealed to the Court of Tax
Appeals, which took cognizance of the case and decided in favor of the
company. The tax authorities appealed to the SC. The SC affirmed the
CTA decision and reiterated earlier case law which held that a
private party who introduces integral improvements on public land
subject to a lease is only a partial usufructuary of the road and
therefore cannot be made to pay real estate tax on those
improvements; because in such cases ownership ultimately
remains with the Government and the improvements remain open
to public use.
FACTS: Samar Mining (Samico) owned a mine and mill in Buug,
Zamboanga del Sur. To connect them to the pier in Pamintayan,
Zamboanga del Sur, the company built the 42-km gravel pit Samico
Road, construction of which was finished in 1959. Since the road
traversed public lands, Samico filed miscellaneous lease applications for
right of way with the Bureau of Lands and the Bureau of Forestry in
1958 and 1959, respectively. Temporary permits were granted, and
eventually the lease applications were granted on Oct. 7, 1965; but the
lease contracts were never executed.
On June 5, 1964, Samico received an assessment letter from the
petitioner Provincial Assessor, charging them P1,117,900.00 as real
estate tax on the taxable portion of Samico Road. Samico appealed the
assessment to petitioner BAA on the ground that the road was not a
taxable improvement because it was constructed entirely on public land
within the meaning of Sec. 2 of CA 470 and the decision of the SC in
Bislig Bay Lumber Co. v. Surigao. The BAA upheld the assessment but
held it unenforceable until the lease contracts were executed. Samico
moved for reconsideration, but the BAA, in a decision dated Aug. 3, 1965,
not only denied the appeal but made the assessment immediately
enforceable, with the amount due accruing from the date of completion
of the road in 1959. Upon second denial by the BAA, Samico elevated its
case to the Court of Tax Appeals.
The Provincial Assessor and the BAA assailed the CTA’s jurisdiction over
the case on the ground that Samico should have paid the tax under
protest first before appealing. On June 28, 1967, the CTA ruled that it has
jurisdiction over the case and then decided in favor of Samico. The CTA
held that since the road was constructed on public lands such that it is an
integral part of the lands and not an independent improvement thereon,
and that upon the termination of the lease the national government will
acquire ownership of the road, Samico should be exempted from paying.
Hence this appeal to the SC.
ISSUE(HELD): W/N the road constructed on alienable public land leased
to Samico is taxable. (NO)
ARGUMENTS/RATIO
1) BAA and the Provincial Assessor argue that the road is an
improvement and, therefore, taxable under Section 2 of the Assessment
Law (Commonwealth Act No. 470) which provides as follows: "Sec. 2.
Incidence of real property tax. - Except in chartered cities, there shall be
levied, assessed, and collected, an annual ad valorem tax on real property
including land, buildings, machinery, and other improvements not
hereinafter specifically exempted."

SC: The road is indeed an improvement, but it is not taxable under Sec. 2
of the Assessment Law pursuant to the ruling in Bislig Bay Lumber Co. v.
Prov’l. Gov’t. of Surigao (100 Phil 303), which held that a private party
who introduces improvements on public land subject to a lease is only a
partial usufructuary of the road and therefore cannot be made to pay
real estate tax; because in such cases ownership ultimately remains with
the Government and the improvements remain open to public use. In
Municipality of Cotabato, et al. v. Santos, (105 Phil 963), it was held that
improvements which form an integral part (such as dikes and gates) of a
publicly-owned immovable (such as swampland converted into
fishponds) are tax-exempt.
2) BAA and the Provincial Assessor argue that Bislig Bay does not apply
because the road in that case was built on inalienable timberland. Samico
Road was built on alienable lands of the public domain and is therefore
taxable.
SC: The argument is untenable. The road in issue in the Bislig Bay case
was exempted not because it was built on inalienable lands but because
it formed an integral part of the public land upon which it was built;
and because it was owned by the Government through accession.
Section 3(a) of the Assessment Law does not distinguish between
alienable or inalienable lands; as long as the land is of public
domain, it is tax-exempt.
3) BAA and the Provincial Assessor argue that the CTA did not acquire
jurisdiction over the case because Samico failed to pay the tax under
protest as required by Sec. 54 of the Assessment Law which states that:
“No court shall entertain any suit assailing the validity of a tax assessment
under this Act until the taxpayer shall have paid under protest the taxes
assessed against him, nor shall any court declare any tax invalid by
reason....”
SC: Sec. 54 of the Assessment Law is inconsistent with the express
provision and legislative intent of RA 1125 (the Law creating the Court
of Tax Appeals), and should be deemed impliedly repealed insofar as it
sets the payment of tax under protest as a prerequisite for appeals to the
CTA. The SC quotes with approval the decision of the CTA, thus: “To
require the taxpayer, as contended by respondents, to pay first the
disputed real property tax before he can file an appeal assailing the
legality and validity of the realty tax assessment will render nugatory the
appellate jurisdictional power of the Court of Tax Appeals as envisioned in
Section 7(3), in relation to Section 11, of Republic Act No. 1125. If we
follow the contention of respondents to its logical conclusion, we cannot
conceive of a case involving the legality and validity of real property tax
assessment, decided by the Board of Assessment Appeals, which can be
appealed to the Court of Tax Appeals.”
The Court further says: “We agree with the foregoing view of the Court of
Tax Appeals. It should be noted that what is involved in the present case is
simply an assessment of realty tax, as fixed by the Provincial Assessor of
Zamboanga del Sur, which was disputed by Samar before the Board of
Assessment Appeals of said province. There was no demand yet for
payment of the realty tax. In fact the letter of the Provincial Assessor, of
June 5, 1964, notifying Samar of the assessment, states as follows: ‘Should
you find the same to be not in accordance with law or its valuation to be
not satisfactory, you may appeal this assessment under Section 17 of
Commonwealth Act 470 to the Board of Assessment Appeals, through
the Municipal Treasurer of Buug, Zamboanga del Sur, within 60 days
from the date of your receipt hereof.’ Accordingly Samar appealed to the
Board questioning the validity of the assessment. The Board rendered a
resolution over-ruling the contention of Samar that the assessment was
illegal. Then Samar availed of its right to appeal from the decision of the
Board to the Court of Tax Appeals as provided in Section 11 of Republic
Act 1125. Section 11 does not require that before an appeal from the
decision of the Board of Assessment Appeals can be brought to the
Court of Tax Appeals, it must first be shown that the party disputing
the assessment had paid under protest the realty tax assessed. In the
absence of such a requirement under the law, all that is necessary for a
party aggrieved by the decision of the Board of Assessment Appeals is to
file his notice of appeal to the Court of Tax Appeals within 30 days after
receipt of the decision of the Board of Assessment Appeals, as provided in
Section 11 of Republic Act 1125.”
In conclusion, the Court held: “From the aforequoted portion of the
decision of this Court, We gather that the only question that may be
brought before the City or Provincial Board of Assessment Appeals is the
question which relates to the reasonableness or legality of the realty tax
that is assessed against a taxpayer. Such being the case, it would be
unjust to require the realty owner to first pay the tax, that he
precisely questions, before he can lodge an appeal to the Court of Tax
Appeals. We believe that it is not the intendment of the law that in
questioning before the Court of Tax Appeals the validity or
reasonableness of the assessment approved by the Board of
Assessment Appeals the taxpayer should first pay the questioned tax.
It is Our view that in so far as appeals from the decision or resolution of
the Board of Assessment Appeals, Section 54 of Commonwealth Act 470
does not apply, and said section can be considered as impliedly repealed by
Sections 7, 11 and 21 of Republic Act 1125.”

DISPOSITION: IN VIEW OF THE FOREGOING, the decision of the Court

of Tax Appeals, appealed from, is affirmed, without pronouncement as to
costs.
106. BALURAN V. NAVARRO - Usufruct remove the house he constructed.
The manner of terminating the right of usufruct may be stipulated by the One last point. At the time of this case, the Obedencias were also in
parties such as in this case, the happening of a resolutory condition. possession of the riceland of Baluran. Although it was not proper to
decide the issue of possession in this case, the Court nevertheless
FACTS: decided on the matter and order the Obedencias to vacate the property
Baluran and Paraiso (ancestor of Obedencio) entered into a contract inasmuch as there was an extinguishment of a reciprocal obligations and
which they called barter, but in fact stipulated that they would only rights.
transfer the material possession of their respective properties to each
other. Thus, Baluran will be allowed to construct a residential house on
the land of Paraiso while Paraiso is entitled to reap the fruits of the
riceland of Baluran. The contract prohibited them from alienating the
properties of the other and contained a stipulation that should the heirs
of Paraiso desire to re-possess the residential lot, Baluran is obliged to
return the lot. Indeed, years after, Obedencio (grandchild of Paraiso)
acquired the ownership of the residential lot from his mother and
demanded that Baluran, who was in possession, vacate.

Baluran now counters that the barter already transferred ownership.

ISSUE:
Whether or not the contract was a barter or usufruct

RULING:
IT IS USUFRUCT. First, the contract is what the law defines it to be and
not what the parties call it. It is very clear that what the parties
exchanged was not ownership, but merely material possession or the
right to enjoy the thing.

Now, because it is usufruct, the law allows the parties to stipulate the
conditions including the manner of its extinguishment. In this case, it
was subject to a resolutory condition which is in case the heir of Paraiso
(a third party) desires to repossess the property. Upon the happening of
the condition, the contract is extinguished.

Therefore, Baluran must return the land to Obedencia. But since Art. 579
allows the usufructuary to remove improvements he made, Baluran may
107. National Housing Authority v CA, Bulacan Garden Corporation
and Manila Seedling Bank Foundation (2005)
National Housing Authority = NHA
Bulacan Garden Corporation = BGC
Manila Seedling Bank Foundation = MSBF
Facts
October 24, 1968: Proclamation 481 set aside 120ha owned by NHA in
Quezon City. It was reserved property for the site of the National
Government Center
September 19, 1977: Proclamation 1670 removed a 7ha portion from
the 120ha. It also gave MBSF usufructuary rights over the 7ha. The
Proclamation stated that the location of the 7ha within the 120ha would
be determined by a future survey under the administration of MBSF.
MBSF's occupancy gradually exceeded the 7ha area. By 1987, it occupied
around 16ha of the 120ha. The land it occupied was bounded by EDSA to
the west, Agham Road to the east, Quezon Avenue to the south, and a
creek to the north.
August 18, 1987: MBSF leased a portion of the area it occupied to BGC
and other stallholders. BGC leased the portion facing EDSA. It occupied
4590 sq m of the 16ha.
November 11, 1987: Memorandum Order 127 revoked the reserved
status of the 50ha remaining from the 120ha NHA property reserved
under Proclamation 481. It authorized the NHA to commercialize the
area and sell it to the public.
August 15, 1988: NHA gave BGC 10 days to vacate its occupied area
because it was outside the 7ha granted to MBSF. After the 10 days,
remaining structures would be demolished by the NHA.
BGC filed a complaint for injunction. Trial court dismissed - NHA may
demolish. NHA demolished BGC's facilities. Court of appeals reversed.
Issues (topical)
Are the premises leased by BGC from MBSF within the 7ha usufructuary
area granted to the latter by Proclamation 1670?
 Where exactly is the 7ha granted by Proclamation 1670
in the 120ha?
 In determining the location of the 7ha, whose land survey
should prevail? MBSF's survey, or the NHA's survey?
Held
To determine the location of the 7ha, MBSF and NHA should conduct a
joint survey. Case remanded to trial court.
A usufruct may be constituted for a specified term and under such
conditions as the parties may deem convenient subject to the legal
provisions on usufruct. A usufructuary may lease the object held in
usufruct. Thus, the NHA may not evict BGC if the 4,590 square meter
portion MSBF leased to BGC is within the seven-hectare area held in
usufruct by MSBF. The owner of the property must respect the lease
entered into by the usufructuary so long as the usufruct exists.[11]
However, the NHA has the right to evict BGC if BGC occupied a portion
outside of the seven-hectare area covered by MSBF’s usufructuary rights.
A usufruct gives a right to enjoy the property of another with the
obligation of preserving its form and substance, unless the title
constituting it or the law otherwise provides. This controversy would
not have arisen had MSBF respected the limit of the beneficial use given
to it
MBSF's survey shows that BGC's stall is within the 7ha. MBSF plots the
location of the 7ha by starting from Quezon Ave going northward along
EDSA. This survey was based on the fact that MBSF's main facilities are
located within this area.

NHA's survey shows that BGC's stall is outside the 7ha. NHA plots the
location of the 7ha by starting from Quezon Ave going towards Agham
Road. This survey was based on the fact that MBSF's gate fronted Agham
Road.

To determine whose survey should be followed, the court cited CC 565:

ART. 565. The rights and obligations of the usufructuary shall be those
provided in the title constituting the usufruct; in default of such title, or
in case it is deficient, the provisions contained in the two following
Chapters shall be observed.

Proclamation 1670 is the title containing the usufruct. It clearly states

that the 7ha should be determined by "“by future survey under the
administration of the Foundation subject to private rights if there be
any.” Thus, it is MBSF's survey that should be followed.

HOWEVER, because MBSF exceeded the 7ha allotted to it by 9ha

(7+9=16ha), the Court ultimately ruled that a joint survey between the
NHA and MBSF should be conducted instead.

Obiter

The Court discussed the duration of the usufruct granted to MBSF. It

cited CC 605:
ART. 605. Usufruct cannot be constituted in favor of a town, corporation,
or association for more than fifty years. If it has been constituted, and
before the expiration of such period the town is abandoned, or the
corporation or association is dissolved, the usufruct shall be
extinguished by reason thereof

Since usufructs may only last a maximum of 50 years, MBSF's usufruct

has only 22 years left, considering Proclamation 1670 was issued on
September 19, 1977 (28 years from the year 2005).
108. Plaintiff: North Negros Sugar Co
Defendant: Hidalgo
Ponente: Recto
FACTS:
 Plaintiff is the owner of a sugar central (known as “mill site”) and also
its adjoining plantation Hacienda “Begona”. He constructed a road
adjoining the “mill site” and the provincial highway. Plaintiff allows
vehicles to pass upon paying toll charge of P0.15 for each one;
pedestrians are allowed free passage.
 Defendant owns the adjoining “Hacienda Sangay” wherein he has a
billiard hall and a tuba saloon (as in drinking place). The road of the
plaintiff is the only means of access to get to Hacienda Sangay.
 At one point, plaintiff stopped defendant from using the said road.
Hence, instead of taking the road to get to his Hacienda Sangay,
defendant passed through Hacienda Begona in a passageway used by
the carabaos.
 Plaintiff applied for injunction to restrain the defendant from
entering/passing through his properties (road & Hacienda).
ISSUE:
WON injunction should be granted.
HELD: NO.
RATIO:
 For injunction to be granted, it must be established that the right
sought to be protected exists, but also that the acts against which the
injunction to be directed are violative of said right.
 In the case at bar, plaintiff failed to establish his right and that the
defendant has committed/attempts to commit acts that endanger
such right. The complaint does not state how and why the mere
passage of defendant over plaintiff’s estate conveying “tuba” to his
Hacienda has caused damage to plaintiff’s property rights. The real
damage that the plaintiff seeks to avoid is the fact that tuba is
disposed of at defendant’s hacienda in which the plaintiff’s laborers
have access (apparently, the plaintiff hates that his laborers are
getting drunk in the tuba saloon of the defendant). This however, is a
nothing more than an exercise of legitimate business on the part of
the defendant. What the law does not authorize to be done directly,
cannot be done indirectly (if plaintiff cannot enjoin defendant from
selling tuba, neither can it obtain injunction to prevent him from
passing over its property to transport tuba).
 (TOPICAL: on mode of acquiring easements): The road was
constructed by the plaintiff on his own land and it made this road
accessible to the public, regardless of class/group of persons/entities.
This is a voluntary easement constituted in favor of the community.
Indeed, the plaintiff may close the road at its pleasure as no period
has been fixed when the easement was constituted, but while the
road is still open, he may not capriciously exclude defendant from its
use. Having the road devoted to the public in general, the road is
charged with public interest and while so devoted, the plaintiff may
not establish discriminatory exceptions against any private person.
He may withdraw his grant by discontinuing its use, but so long as he
maintains it, he must submit to the control.
 Furthermore there exists a forcible right of way in favor of the
defendant (CC 564) because those living in Hacienda Sangay have no
access to the provincial road except through the road in question.