CIR vs.

Isabela Cultural Corporation

Isabela Cultural Corp.(ICC for brevity) , a domestic corporation received from BIR assessment notice no. FAS-1-86-
90000680 (680 for brevity) for deficiency income tax in the amount of PhP 333,196.86 and assessment notice no. FAS-1-
86-90-000681 (681 for brevity) for deficiency expanded withholding tax in the amount of PhP 4,897.79, inclusive of
surcharge and interest both for the taxable year 1986. The deficiency income tax of PhP 333,196 arose from BIR
disallowance of ICC claimed expenses deductions for professional and security services billed to and paid by ICC in 1986.

The deficiency expanded withholding tax of PhP4,897.79 was allegedly due to the failure of ICC to withhold 1% expanded
withholding tax on its claimed PhP244,890 deduction for security services.

Court of Tax Appeal and Court of Appeal affirmed that the professional services were rendered to ICC in 1984 and 1985,
the cost of the service was not yet determinable at that time, hence, it could be considered as deductible expenses only
in 1986 when ICC received the billing statement for said service. It further ruled that ICC did not state its interest income
from the promissory notes of Realty Investment and that ICC properly withheld the remitted taxes on the payment for
security services for the taxable year 1986.

Petitioner contend that since ICC is using the accrual method of accounting, the expenses for the professional services
that accrued in 1984 and 9185 should have been declared as deductions from income during the said years and the failure
of ICC to do so bars it from claiming said expenses as deduction for the taxable year 1986.

ISSUE (1): WON CA is correct in sustaining the deduction of the expenses for professionals and security services form ICC
gross income?

HELD: NO

Revenue Audit Memorandum Order No.1-2000 provides that under the accrual method of accounting, expenses not being
claimed as deductions by a tax payer in the current year when they are incurred cannot be claimed as deductions from
the income for the succeeding year.

ISSUE (2): WON CA correctly held that ICC did not understate its interest income from the promissory notes of Realty
Investment, Inc; that ICC withheld the required 1% withholding tax from the deduction for security services.

HELD:

Sustaining the finding of the CTA and CA that no such understatement exist and that only simple interest computation and
not a compounded one should have been applied by the BIR. There is no indeed no stipulation between the latter and
ICC on the application of compound interest.

Under Article 1959 of the Civil Code, unless there is a stipulation to the contrary, interest due should not further earn
interest.

Commissioner of Internal Revenue v Ayala Securities Corporation

Facts:

Ayala Securities Corp. (Ayala) failed to file returns of their accumulated surplus so Ayala was charged with 25% surtax by
the Commissioner of internal Revenue. The CTA (Court of Tax Appeals) reversed the Commissioner’s decision and held
that the assessment made against Ayala was beyond the 5-yr prescriptive period as provided in section 331 of the National
Internal Revenue Code. Commissioner now files a motion for reconsideration of this decision. Ayala invokes the defense
of prescription against the right of the Commissioner to assess the surtax.

Issue:

Whether or not the right to assess and collect the 25% surtax has prescribed after five years.
Held:

No. There is no such time limit on the right of the Commissioner to assess the 25% surtax since there is no express statutory
provision limiting such right or providing for its prescription. Hence, the collection of surtax is imprescriptible. The
underlying purpose of the surtax is to avoid a situation where the corporation unduly retains its surplus earnings instead
of declaring and paying dividends to its shareholders. SC reverses the ruling of the CTA.

Surigao vs CTA 57 SCRA 523

Facts: Petitioner Surigao Electric Co., grantee of a legislative electric franchise, contested a warrant of distrain and levy to
enforce the collection from "Mainit Electric" of a deficiency franchise tax plus surcharge. Thereafter the Commissioner, by
letter dated April 2, 1961, advised the petitioner to take up the matter with the General Auditing Office, enclosing a copy
of the 4th Indorsement of the Auditor General dated November 23, 1960. This indorsement indicated that the petitioner's
liability for deficiency franchise tax for the period from September 1947 to June 1959 was P21,156.06, excluding surcharge.
Subsequently, in letter to the Auditor General dated August 2, 1962, the petitioner asked for reconsideration of the
assessment, admitting liability only for the 2% franchise tax in accordance with its legislative franchise and not at the
higher rate of 5% imposed by Sec. 259 of the NIRC, which latter rate the Auditor General used as basis in computing the
petitioner's deficiency franchise tax. An exchange of correspondence between the petitioner, on the one hand, and the
Commissioner and the Auditor General, on the other, ensued, all on the matter of the petitioner's liability for deficiency
franchise tax. The controversy culminated in a revised assessment dated April 29, 1963 in the amount of P11,533.53,
representing the petitioner's deficiency franchise-tax and surcharges thereon for the period from April 1, 1956 to June
30,1959. The petitioner then requested a recomputation of the revised assessment in a letter to the Commissioner dated
June 6, 1963. The Commissioner, however, in a letter dated June 28, 1963 denied the request for recomputation.
Petitioner appealed to the CTA which was subsequently dismissed on the ground that the appeal was filed beyond the
thirty-day period of appeal provided by Sec. 11 of Republic Act 1125.

Issue:

WON the petitioner's appeal to the CTA was time-barred.

Ruling:

YES. To sustain the petitioner's contention that the Commissioner's letter of June 28, 1963 denying its request for further
amendment of the revised assessment constitutes the ruling appealable to the tax court and that the thirty-day period
should, therefore, be counted from July 16, 1963, the day it received the June 28, 1963 letter, would, in effect, leave solely
to the petitioner's will the determination of the commencement of the statutory thirty-day period, and place the
petitioner — and for that matter, any taxpayer — in a position, to delay at will and on convenience the finality of a tax
assessment. This absurd interpretation espoused by the petitioner would result in grave detriment to the interests of the
Government, considering that taxes constitute its life-blood and their prompt and certain availability is an imperative
need.

-CIR vs. union shipping corp

This is a petition for review on certiorari of the December 9, 1983 decision* of the Court of Tax Appeals in CTA Case No.
2989 reversing the Commissioner of Internal Revenue.

In a letter dated December 27, 1974 (Exhibit. "A"), herein petitioner Commissioner of Internal Revenue assessed against
Yee Fong Hong, Ltd. and/or herein private respondent Union Shipping Corporation, the total sum of P583,155.22 as
deficiency income taxes due for the years 1971 and 1972. Said letter was received on January 4,1975, and in a letter dated
January 10, 1975 (Exhibit "B"), received by petitioner on January 13, 1975, private respondent protested the assessment.

Petitioner, without ruling on the protest, issued a Warrant of Distraint and Levy (Exhibit "C"), which was served on private
respondent's, counsel, Clemente Celso, on November 25, 1976.
In a letter dated November 27, 1976 (Exhibit "D"), received by petitioner on November 29, 1976 (Exhibit "D-1"), private
respondent reiterated its request for reinvestigation of the assessment and for the reconsideration of the summary
collection thru the Warrant of Distraint and Levy.

Petitioner, again, without acting on the request for reinvestigation and reconsideration of the Warrant of Distraint and
Levy, filed a collection suit before Branch XXI of the then Court of First Instance of Manila and docketed as Civil Case No.
120459 against private respondent. Summons (Exhibit "E") in the said collection case was issued to private respondent
on December 28, 1978.

On January 10, 1979, private respondent filed with respondent court its Petition for Review of the petitioner's assessment
of its deficiency income taxes in a letter dated December 27, 1974, docketed therein as CTA Case No. 2989 (Rollo, pp. 44-
49), wherein it prays that after hearing, judgment be rendered holding that it is not liable for the payment of the income
tax herein involved, or which may be due from foreign shipowner Yee Fong Hong, Ltd.; to which petitioner filed his answer
on March 29, 1979 (Rollo, pp. 50-53).

Respondent Tax Court, in a decision dated December 9, 1983, ruled in favor of private respondent -

"WHEREFORE, the decision of the Commissioner of Internal Revenue appealed from, assessing against and demanding
from petitioner the payment of deficiency income tax, inclusive of 50% surcharge, interest and compromise penalties, in
the amounts of P73,958.76 and P583,155.22 for the years 1971 and 1972, respectively, is reversed."

Hence, the instant petition.

The Second Division of this Court, after the filing of the required pleadings, in a resolution dated January 28, 1985, resolved
to give due course to the petition, and directed petitioner therein, to file his brief (Rollo, p. 145). In compliance, petitioner
filed his brief on May 10, 1985 (Rollo, p. 151). Respondents, on the other hand, filed their brief on June 6,1985 (Rollo,
p.156).

The main issues in this case are: (a) on the procedural aspect, whether or not the Court of Tax Appeals has jurisdiction
over this case and (b) on the merits, whether or not Union Shipping Corporation acting as a mere "husbanding agent" of
Yee Fong Hong Ltd. is liable for payment of taxes on the gross receipts or earnings of the latter.

The main thrust of this petition is that the issuance of a warrant or distraint and levy is proof of the finality of an assessment
because it is the most drastic action of all media of enforcing the collection of tax, and is tantamount to an outright denial
of a motion for reconsideration of an assessment. Among others, petitioner contends that the warrant of distraint and
levy was issued after respondent corporation filed a request for reconsideration of subject assessment, thus constituting
petitioner's final decision in the disputed assessments (Brief for Petitioner, pp. 9 and 12).

Petitioner argues therefore that the period to appeal to the Court of Tax Appeals commenced to run from receipt of said
warrant on November 25, 1976, so that on January 10, 1979 when respondent corporation sought redress from the Tax
Court, petitioner's decision has long become final and executory.

On this issue, this Court had already laid down the dictum that the Commissioner should always indicate to the taxpayer
in clear and unequivocal language what constitutes his final determination of the disputed assessment.

Specifically, this Court ruled:

"x x x we deem it appropriate to state that the Commissioner of Internal Revenue should always indicate to the taxpayer
in clear and unequivocal language whenever his action on an assessment questioned by a taxpayer constitutes his final
determination on the disputed assessment, as contemplated by sections 7 and 11 of Republic Act 1125, as amended. On
the basis of this statement indubitably showing that the Commissioner's communicated action is his final decision on the
contested assessment, the aggrieved taxpayer would then be able to take recourse to the tax court at the opportune time.
Without needless difficulty, the taxpayer would be able to determine when his right to appeal to the tax court accrues.
This rule of conduct would also obviate all desire and opportunity on the part of the taxpayer to continually delay the
finality of the assessment and, consequently, the collection of the amount demanded as taxes -- by repeated requests for
recomputation and reconsideration. On the part of the Commissioner, this would encourage his office to conduct a careful
and thorough study of every questioned assessment and render a correct and definite decision thereon in the first
instance. This would also deter the Commissioner from unfairly making the taxpayer grope in the dark and speculate as
to which action constitutes the decision appealable to the tax court. Of greater import, this rule of conduct would meet
a pressing need for fair play, regularity, and orderliness in administrative action." (Surigao Electric Co., Inc. v. C.T.A., 57
SCRA 523, 528, [11974]).

There appears to be no dispute that petitioner did not rule on private respondent's motion for reconsideration but contary
to the above ruling of this Court, left private respondent in the dark as to which action of the Commissioner is the decision
appealable to the Court of Tax Appeals. Had he categorically stated that he denies private respondent's motion for
reconsideration and that his action constitutes his final determination on the disputed assessment, private respondent
without needless difficulty would have been able to determine when his right to appeal accrues and the resulting
confusion would have been avoided.

Much later, this Court reiterated the above-mentioned dictum in a ruling applicable on all fours to the issue in the case at
bar, that the reviewable decision of the Bureau of Internal Revenue is that contained in the letter of its Commissioner,
that such constitutes the final decision on the matter which may be appealed to the Court of Tax Appeals and not the
warrants of distraint (Advertising Associates, Inc. v. Court of Appeals, 133 SCRA 769 [1984] underscoring supplied). It was
likewise stressed that the procedure enunciated is demanded by the pressing need for fair play, regularity and orderliness
in administrative action.

Under the circumstances, the Commissioner of Internal Revenue, not having clearly signified his final action on the
disputed assessment, legally the period to appeal has not commenced to run. Thus, it was only when private respondent
received the summons on the civil suit for collection of deficiency income on December 28, 1978 that the period to appeal
commenced to run.

The request for reinvestigation and reconsideration was in effect considered denied by petitioner when the latter filed a
civil suit for collection of deficiency income. So that on January 10, 1979 when private respondent filed the appeal with
the Court of Tax Appeals, it consumed a total of only thirteen (13) days well within the thirty day period to appeal pursuant
to Section 11 of R.A. 1125.

On the merits, it was found fully substantiated by the Court of Tax Appeals that, respondent corporation is the husbanding
agent of the vessel Yee Fong Hong, Ltd. as follows:

"Coming to the second issue, petitioner contended and was substantiated by satisfactory uncontradicted testimonies of
Clemente Celso, Certified Public Accountant, and Rodolfo C. Cabalquinto, President and General Manager, of petitioner
that it is actually and legally the husbanding agent of the vessel of Yee Fong Hong, Ltd. as (1) it neither performed nor
transacted any shipping business, for and in representation, of Yee Fong Hong, Ltd. or its vessels or otherwise negotiated
or procured cargo to be loaded in the vessels of Yee Fong Hong, Ltd. (p. 21, t.s.n., July 16, 1980); (2) it never solicited or
procured cargo or freight in the Philippines or elsewhere for loading in said vessels of Yee Fong Hong, Ltd. (pp. 21 & 38,
ibid.); (3) it had not collected any freight income or receipts for the said Yee Fong Hong, Ltd. (pp. 22 & 38, ibid.; pp. 46 &
48, t.s.n., Nov. 14, 1980.); (4) it never had possession or control, actual or constructive, over the funds representing
payment by Philippine shippers for cargo loaded on said vessels (pp. 21 & 38, ibid; p. 48, ibid); petitioner never remitted
to Yee Fong Hong, Ltd. any sum of money representing freight incomes of Yee Fong Hong, Ltd. (p. 21, ibid.; p. 48, ibid);
and (5) that the freight payments made for cargo loaded in the Philippines for foreign destination were actually paid
directly by the shippers to the said Yee Fong Hong, Ltd. upon arrival of the goods in the foreign ports." (Rollo, pp. 58-59).

On the same issue, the Commissioner of Internal Revenue Misael P. Vera, on query of respondent's counsel, opined that
respondent corporation being merely a husbanding agent is not liable for the payment of the income taxes due from the
foreign ship owners loading cargoes in the Philippines (Rollo, p. 63; Exhibit "I", Rollo, pp. 64- 66).
Neither can private respondent be liable for withholding tax under Section 53 of the Internal Revenue Code since it is not
in possession, custody or control of the funds received by and remitted to Yee Fong Hong, Ltd., a non-resident taxpayer.
As correctly ruled by the Court of Tax Appeals, "if an individual or corporation like the petitioner in this case, is not in the
actual possession, custody, or control of the funds, it can neither be physically nor legally liable or obligated to pay the so-
called withholding tax on income claimed by Yee Fong Hong, Ltd." (Rollo, p. 67).

Finally, it must be stated that factual findings of the Court of Tax Appeals are binding on this Court (Industrial Textiles
Manufacturing Company of the Phil., Inc. (ITEMCOP) v. Commissioner of Internal Revenue, et al. (136 SCRA 549 [1985]).
It is well-settled that in passing upon petitions for review of the decisions of the Court of Tax Appeals, this Court is generally
confined to questions of law. The findings of fact of said Court are not to be disturbed unless clearly shown to be
unsupported by substantial evidence (Commissioner of Internal Revenue v. Manila Machinery & Supply Company, 135
SCRA 8 [1985]).

A careful scrutiny of the records reveals no cogent reason to disturb the findings of the Court of Tax Appeals.

PREMISES CONSIDERED, the instant petition is hereby DISMISSED and the assailed decision of the Court of Tax Appeals is
hereby AFFIRMED.

SO ORDERED.

Melencio-Herrera, (Chairman), Padilla, Sarmiento, and Regalado, JJ., concur.

Republic of the Philippines vs Lim Tian Teng Sons and Co., Inc.

Taxation – Tax Collection – Period to Collect – No need for a final and executory assessment

In January 1957, the Collector of Internal Revenue (CIR) made an assessment against Lim Tian Teng Sons and Co., Inc.
(LTTSCI) demanding from the latter payment of P15k in taxes inclusive of surcharge. In the same month, LTTSCI requested
for a reinvestigation with a request to produce supporting evidence. The CIR did not reply however he remanded the case
to the Solicitor General (SG) who did not grant a reinvestigation but rather reiterated the content of the assessment. In
September 1958, the CIR filed a tax collection suit against LTTSCI with the Court of First Instance of Cebu. LTTSCI assailed
the collection suit on the ground that the CIR cannot commence collection without a final and executory assessment
notice. It alleged that the assessment notice issued in January 1957 has not yet become final and executory because of
the failure of the CIR to act on the protest.

ISSUE: Whether or not LLTSCI I correct.

HELD: No. Nowhere in the Tax Code is the CIR required to rule first on a taxpayer’s request for reinvestigation before he
can go to court for the purpose of collecting the tax assessed. Ruling on the protest is not a condition precedent for the
commencement of tax collection. The CIR is authorized to collect delinquent internal revenue taxes either by distraint and
levy or by judicial action or both simultaneously. The only requisite before he can collect the tax is that he must first assess
the same within the time fixed by law – and this was complied with in the case at bar. The Supreme Court notes that in
the case of a false or fraudulent return with intent to evade the tax or of a failure to file a return, a proceeding in court for
the collection of such tax may be begun without assessment.
Commissioner of Internal Revenue vs. Algue Inc.

GR No. L-28896 | Feb. 17, 1988

Facts:

· Algue Inc. is a domestic corp engaged in engineering, construction and other allied activities

· On Jan. 14, 1965, the corp received a letter from the CIR regarding its delinquency income taxes from 1958-1959,
amtg to P83,183.85

· A letter of protest or reconsideration was filed by Algue Inc on Jan 18

· On March 12, a warrant of distraint and levy was presented to Algue Inc. thru its counsel, Atty. Guevara, who refused
to receive it on the ground of the pending protest

· Since the protest was not found on the records, a file copy from the corp was produced and given to BIR Agent
Reyes, who deferred service of the warrant

· On April 7, Atty. Guevara was informed that the BIR was not taking any action on the protest and it was only then
that he accepted the warrant of distraint and levy earlier sought to be served

· On April 23, Algue filed a petition for review of the decision of the CIR with the Court of Tax Appeals

· CIR contentions:

- the claimed deduction of P75,000.00 was properly disallowed because it was not an ordinary reasonable or necessary
business expense

- payments are fictitious because most of the payees are members of the same family in control of Algue and that
there is not enough substantiation of such payments

· CTA: 75K had been legitimately paid by Algue Inc. for actual services rendered in the form of promotional fees. These
were collected by the Payees for their work in the creation of the Vegetable Oil Investment Corporation of the Philippines
and its subsequent purchase of the properties of the Philippine Sugar Estate Development Company.

Issue: W/N the Collector of Internal Revenue correctly disallowed the P75,000.00 deduction claimed by Algue as legitimate
business expenses in its income tax returns

Ruling:

· Taxes are the lifeblood of the government and so should be collected without unnecessary hindrance, made in
accordance with law.

· RA 1125: the appeal may be made within thirty days after receipt of the decision or ruling challenged

· During the intervening period, the warrant was premature and could therefore not be served.

· Originally, CIR claimed that the 75K promotional fees to be personal holding company income, but later on conformed
to the decision of CTA

· There is no dispute that the payees duly reported their respective shares of the fees in their income tax returns and
paid the corresponding taxes thereon. CTA also found, after examining the evidence, that no distribution of dividends was
involved

· CIR suggests a tax dodge, an attempt to evade a legitimate assessment by involving an imaginary deduction
· Algue Inc. was a family corporation where strict business procedures were not applied and immediate issuance of
receipts was not required. at the end of the year, when the books were to be closed, each payee made an accounting of
all of the fees received by him or her, to make up the total of P75,000.00. This arrangement was understandable in view
of the close relationship among the persons in the family corporation

· The amount of the promotional fees was not excessive. The total commission paid by the Philippine Sugar Estate
Development Co. to Algue Inc. was P125K. After deducting the said fees, Algue still had a balance of P50,000.00 as clear
profit from the transaction. The amount of P75,000.00 was 60% of the total commission. This was a reasonable proportion,
considering that it was the payees who did practically everything, from the formation of the Vegetable Oil Investment
Corporation to the actual purchase by it of the Sugar Estate properties.

· Sec. 30 of the Tax Code: allowed deductions in the net income – Expenses - All the ordinary and necessary expenses
paid or incurred during the taxable year in carrying on any trade or business, including a reasonable allowance for salaries
or other compensation for personal services actually rendered xxx

· the burden is on the taxpayer to prove the validity of the claimed deduction

· In this case, Algue Inc. has proved that the payment of the fees was necessary and reasonable in the light of the
efforts exerted by the payees in inducing investors and prominent businessmen to venture in an experimental enterprise
and involve themselves in a new business requiring millions of pesos.

· Taxes are what we pay for civilization society. Without taxes, the government would be paralyzed for lack of the
motive power to activate and operate it. Hence, despite the natural reluctance to surrender part of one's hard earned
income to the taxing authorities, every person who is able to must contribute his share in the running of the government.
The government for its part, is expected to respond in the form of tangible and intangible benefits intended to improve
the lives of the people and enhance their moral and material values

· Taxation must be exercised reasonably and in accordance with the prescribed procedure. If it is not, then the taxpayer
has a right to complain and the courts will then come to his succor

Algue Inc.’s appeal from the decision of the CIR was filed on time with the CTA in accordance with Rep. Act No. 1125. And
we also find that the claimed deduction by Algue Inc. was permitted under the Internal Revenue Code and should
therefore not have been disallowed by the CIR
THE ROMAN CATHOLIC ARCHBISHOP OF MANILA, Petitioner-Appellee, v. PEDRO P. ROXAS, opponent-appellant.

Sanz & Opisso, for Appellant.

William A. Kincaid and Thomas L. Hartigan, for Appellee.

SYLLABUS

1. REALTY; EASEMENTS; RIGHT OF WAY. — Although a road leading through an estate has been used by the tenants of
another estate, by people attending a house of public worship, and by the public generally for a great number of years,
no easement is thereby created when the facts show that such use has been merely for convenience. To hold otherwise
would destroy all neighborhood accommodations in the way of travel, as no one would incur the danger of encumbering
his estate with such a burden for the mere accommodation of his neighbors.

2. ID.; ID.; ID.; PRESCRIPTION. — To establish the easement of right of way by prescription in those cases where the use is
for convenience merely, the presumption of permissive use or license must be overcome.

DECISION

TRENT, J. :

This appeal involves only a right of way claimed by the appellant Pedro P. Roxas, the owner of the dominant estate, across
parcel L, the property of the appellee, to Calle Tejeron, a distance of about 100 meters. The servient estate is bounded on
the north by an estero; on the west by the dominant estate; on the southwest by Calle Tejeron; and on the west by lands
of Francisco Managan. The eastern line, which joins the dominant estate, is 265 meters long. The appellant claims a right
of way starting across parcel L at a point 198 meters from the southern extremity of this line. During the trial of this case
in the court below the parties entered into the following agreement:jgc:chanrobles.com.ph

"It is admitted as a question of fact that the road between the Hacienda de San Pedro Macati and Calle Tejeron, which,
according to the witness Leopoldo Areopaguita, was formerly a meter and a half or two meters wide, although at present
it has a greater width, has been used from time immemorial by the tenants of the Hacienda de San Pedro Macati for the
passage of carts entering and leaving the Hacienda."cralaw virtua1aw library

In addition to the admitted facts as above set forth, the testimony shows that the road in question is now some 4 meters
wide; that since time out of mind there has existed upon lot L near the middle, and also very near this road, a small church;
that the faithful use said road in going to this place of worship and that said road is not only used by the tenants of the
appellant but also by the people living in the sitio of Suavoy.

It is admitted by both parties that the tenants of the dominant estate have used the road in question since time
immemorial for carts, both for entering and leaving the hacienda. It is also an established fact that the said hacienda (the
dominant estate) is partly bounded on the south by Calle Tejeron. The point where it is claimed that this right of way starts
across lot L is only 198.25 meters from the said street. So the claim of the appellant cannot be that the right of way exists
by necessity growing out of the peculiar location of his property, but simply that it arises by prescription, founded alone
upon immemorial use by his tenants.

The result is that the road which the appellant seeks to have declared a right of way for the benefit of his hacienda has
been used for a great number of years by the members of the appellee’s church to go to and from the ermita, and also by
the appellant’s tenants, and by other people. And furthermore, while it is true that the appellant’s tenants have used this
road for carts as above stated, yet it has not been shown that such use was absolutely necessary in order to cultivate the
dominant estate, but, on the contrary, it clearly appears that the said tenants crossed lot L merely on account of
convenience, as they could have reached the public highway by going in other directions, especially south, only 198
meters. Therefore, the admitted and established facts show (1) that the use of the road by the tenants of the appellant in
this manner and under these circumstances has not been such as to create an easement by prescription or in any other
manner; and (2) that the use of said road by all has been by permission or tolerance of the appellee.
Where a tract of land, as in the case at bar, attached to a public meeting house — such as the ermita — is designedly left
open and uninclosed for the convenience of the members or worshippers of that church, the mere passage of persons
over it in common with those for whose use it was appropriated is to be regarded as permissive and under an implied
license, and not adverse. Such a use is not inconsistent with the only use which the proprietor thought fit to make of the
land, and until the appellee thinks proper to inclose it, such use is not adverse and will not preclude it from enclosing the
land when other views of its interests render it proper to do so. And though an adjacent proprietor may make such use of
the open land more frequently than another, yet the same rule will apply unless there be some decisive act indicating a
separate and exclusive use under a claim of right. A different doctrine would have a tendency to destroy all neighborhood
accommodations in the way of travel; for if it were once understood that a man, by allowing his neighbor to pass through
his farm without objection over the pass-way which he used himself, would thereby, after the lapse of time, confer a right
on such neighbor to require the pass-way to be kept open for his benefit and enjoyment, a prohibition against all such
travel would immediately ensue. And again, it must be remembered that a right of way, like the one sought to be
established in the case at bar, is a charge imposed upon real property for the benefit of another estate belonging to a
different owner. Such a right of way is a privilege or advantage in land existing distinct from the ownership of the soil; and
because it is a permanent interest in another’s land with a right to enter at all times and enjoy it, it can only be founded
upon an agreement or upon prescription. And when the latter is relied upon in those cases where the right of way is not
essential for the beneficial enjoyment of the dominant estate, the proof showing adverse use — which is an affirmative
claim — must be sufficiently strong and convincing to overcome the presumption of permissive use or license, as such a
right of way is never implied because it is convenient.

For these reasons, the judgment appealed from denying the appellant’s claim to a right of way across lot L is affirmed,
with costs against the Appellant.

Carson, J., concurs.

Johnson and Moreland, JJ., concur in the result.

TORRES, J., concurring:chanrob1es virtual 1aw library

I think that the decision should be affirmed in so far as it orders the registration of the land, but with express recognition
of the right of way or road across the land, to this extent reversing the portion overruling the objection.