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Possession Cases residing on the same property as caretakers hired to oversee the land and the improvements thereon.
Dalida vs. Court of Appeals, 117 SCRA 480, No. 53983 September 30, 1982
Facts:
Tomas Benitez was the bona fide and the registered holder of Revocable Permit Application No. V-13279
issued by the Bureau of Lands on August 15, 1945 which allowed him to occupy and possess a parcel of
land located at Bonbon, Balayan, Batangas. While the original land area applied for by Benitez was for
4,000 square meters, his right to the land was disputed by adjoining land owners. To settle the dispute
the area covered by Recoverable Permit Application No. V-13279 was reduced to 2,200 square meters
for Benitez.
Tomas Benitez died. His widow Conchita Benitez conveyed all their rights to the 2,200 square meters lot
to Agustin Benitez, private respondent herein. On August 30, 1975 Conchita Benitez formally advised
spouses Pedro Dalida and Luciana Dalida, petitioners herein, who were then employed as caretakers of
the land, to vacate the property and turn over the same to private respondent Agustin Ramos. The
spouses did not heed the instruction of Benitez and instead, on September 25, 1975, applied with the
Bureau of Lands for a miscellaneous sales application over 4,000 square meters of land, including that
property covered by Revocable Permit Application No. V-13279 in the name of Tomas Benitez. On
November 18, 1975 private respondent sent a demand letter to petitioner spouses to vacate and turn
over the premises to the former. For failure of petitioners to leave the property, a complaint for illegal
detainer dated January 17, 1976 was filed by private respondent before the Municipal Court of Balayan.
Petitioners alleged that they were never employed as caretakers; that they were in actual and peaceful
occupation and possession of the land in question since 1946; and that they occupied the land when it
was still forested and were the ones who cleared and cultivated the same and introduced improvements
thereon.
After trial and hearing the court a quo rendered a decision in favor of private respondent ordering
petitioners to vacate the premises in question. The said court held that petitioners were merely caretakers
for the whole length of time of their stay in the premises.
CA affirmed the trial court’s decision. Petitioners then filed a petition for review.
Issue: Whether the private respondents has the better right of possession.
Held:
The Court agrees with petitioners that in an action for illegal detainer the main issue is the determination
of who between the rival claimants has a better right of possession with a view to protecting the same
and preventing disorder and breaches of the peace. As found out by the court a quo, the Court of First
Instance and finally the Court of Appeals, private respondent and/or his predecessor-in-interest, bona
fide applicant of the land in dispute, had been in open, actual, exclusive and uninterrupted possession of
the property in question in the concept of an owner for over thirty (30) years and petitioners were in fact
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On this point, We have to restate the settled rule in this jurisdiction that findings of fact of the Court of
Appeals are binding and conclusive on this Court.
Mere caretakers of land without right to possession of disputed land
It is thus clear that private respondent's predecessor-in-interest was a bona fide applicant of the land in
dispute and in his favor was duly issued a permit pursuant to Revocable Permit Application No. V-13279
dated 1945. Petitioners, on the other hand, have nothing giving them any right to possession other than
that of mere caretakers as in the allegation of private respondent, who, by reason of the permit
abovementioned, have solid basis of their claim to the right of possession with petitioners merely as
caretakers.
There are compelling reasons of policy supporting the recognition of a right in a bona fide applicant who
has occupied the land applied for. Recognition of the right encourages actual settlement; it discourages
speculation and land-grabbing. It prevents conflicts and the overlapping of claims. It is an act of simple
justice to the diligence of the pioneer, without which land settlement cannot be encouraged or emigration
from thickly populated areas hastened.
Petition is Denied.
US vs. Tan Tay Co
That the fact that a pipe and other utensils for smoking opium were found in the store of one of the
defendants, and in the sleeping room of the other, is not conclusive proof of the fact that those utensils
were found in the possession of one or both the defendants, so as to justify a conviction under the
provisions of section 7 of the Opium Law; and that upon satisfactory proof of the absence of the
animus possidendi, they should be acquitted.
Facts:
This is an appeal from a judgment convicting the appellants, Tan Tayco and Co Sencho, of a violation
of the provisions of section 7 of Act No. 1761 (Opium Law), and sentencing them, and each of them, to
a fine of P500, or in case of insolvency, to the corresponding subsidiary 'imprisonment prescribed in
such cases, and to the payment of the costs of the trial.
On the night of the 30th day of November, 1907, in the municipality of Ormoc, Province of Leyte, the
municipal treasurer, accompanied by a policeman, found various utensils, used for smoking opium,
including a lamp and a pipe, in a store owned by one of the defendants, Tan Tayco, and his partner,
Andres T. Avila, These utensils were found near or under Avila's bed in the room occupied by him
jointly with the defendant Co Sencho, who was employed as an assistant in the store. This room
connected with the room occupied by the defendant, Tan Tayco, by a small passageway.
The discovery of these utensils was conclusively established by the testimony of the witnesses for the
prosecution, and was not denied by the defendants, who admitted that they were not authorized under

the provisions of section 7 of the Opium Law to have such utensils in their possession. But they denied
the allegation of the information, that these utensils were in their possession or control at the time of
their discovery, claiming that they were the property of Andres Avila, one of the coproprietors of the
store. Avila admitted that he was the owner of the utensils in question.
Section 7 of Act No. 1761 is as follows:
"(a) Except upon the prescription of a duly licensed and practicing physician or upon lawful permit of the
Collector of Internal Revenue, it shall be unlawful for any person not a duly licensed and practicing
physician, pharmacist, second-class pharmacist, licensed dispensator of opium, or a duly registered user
of opium, when using the same in a licensed opium dispensary only and in such quantities as may be
stated in his certificate, to have in his possession opium, or any pipes, hypodermic syringes, or other
apparatus or paraphernalia to be used for smoking, injecting, or using opium in any manner.
"(b) Any person violating the provisions of this section shall be punished by a fine not exceeding five
hundred pesos or by imprisonment for a period not exceeding one year, or by both such fine and
imprisonment, in the discretion of the court: Provided, That all opium, pipes, and other opium apparatus
and paraphernalia found in the possession of any person not authorized- to have same shall be seized
and forfeited to the Government.
Defendants on appeal attacked the constitutionality of this section on the ground that its enactment
was in violation of the provisions of section 5 of the Philippine Bill, which provides that no person shall
be deprived of his life, liberty, or property without due process of law.
Held:
The discovery of the pipe and other utensils at the time and place above indicated tends strongly to
support the contention of the prosecution that they were found in the possession of one or both of
these defendants, but it is not conclusive evidence as to that fact.
Possession has been defined to be the detention or enjoyment of a thing which a man holds or
exercises by himself or by another who keeps or exercises it in his name. (Bouvier's Law Dictionary,
Rawles' revision, Vol. II.)
Clearly it involves a state of mind on the part of the possessor whereby he intends to exercise, and as a
consequence of which, he does exercise a right of possession, whether that right be legal or otherwise;
and while the intention and the will to possess may be, and usually are inferred from the fact that the
thing in question is under the apparent power and control of the alleged possessor, nevertheless, the
existence of the animus possidendi is subject to contradiction, and may be rebutted by evidence which
tends to prove that the person under whose power and control the thing in question appears to be, does
not in fact exercise such power of control and does not intend so to do. In order to complete a possession
two things are required, that there be an occupancy, apprehension, or taking; that the taking be with an
intent to possess (animus possidendi). Hence persons who have no legal wills, as children of insufficient
understanding and idiots, can not possess or acquire a complete possession (Pothier, Etienne, see 1 Mer.,
358; Abb. Sh., 9); so where stolen property is placed in the house or upon the premises of A, without his
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knowledge or consent, A is not properly speaking in possession of such property, so long as he does not
assert a right to its control, and is not moved by the animus possidendi with reference thereto.
The statements of the witness Avila, if they can be believed, furnish a full, satisfactory, and sufficient
explanation of the presence of the utensils for smoking opium in his house at the time of their seizure,
which is entirely consistent with the allegations of the defendant that those utensils were not at that time
in their possession; and, therefore, entirely consistent with the innocence of the defendants charged with
a violation of the provisions of the above-cited section of the Opium Act.
Alo vs. Rocamora, 6 Phil., 197, No. 2440 April 27, 1906
From the fact that the ownership of the piece of property is not recorded in the registry in favor of the
person in possession thereof, it can not be inferred that such person is not the owner of the property,
provided it be shown that he acquired the same, that the property is not registered in the name of
another, and that he has been in the quiet and peaceful possession thereof."
Facts:
Counsel for Telesforo Alo brought a complaint in the Court of First Instance of Cebu on the 12th of July,
1904, against Clodoaldo Rocamora, and asked that judgment be given in his favor, condemning the
defendant to return a parcel of land situated in the barrio of Giloctog, municipality of Barili of that island
(Cebu). The defendant in his answer denies each and all of the allegations contained in the different
paragraphs of the complaint.
Judging from the terms of the complaint, the action brought by the plaintiff is that known in law as
"acción revindicatoria." The possession of the land to which the plaintiff claimed he was entitled prior to
the year 1897, when he was deprived thereof by the defendant, was a possession civil in its nature and
was held by him as owner.
Both parties agree that Hilario Ogsimar was the former owner of the land in question. Even though the
purchase of the same alleged by Clodoaldo Rocamora actually took place, such purchase was made after
the prior purchase of the plaintiff, Alo, as appears from the document executed before the local authorities
of the town of Barili where the land in question is located.
Article 1473 of the Civil Code provides:
"If the same thing should have been sold to different vendees, the ownership shall be transferred to the
person who may have first taken possession thereof in good faith, if it should be personal property.
"Should it be real property, it shall belong to the -person acquiring it who first recorded it in the registry.
"Should there be no entry, the property shall belong to the person who first took possession of it in good
faith, and, in the absence thereof, .to the person who presents the oldest title, provided there is good
faith."

Issue: Whether Telesforo is the legitimate owner by way of his possession.
Held: Yes, The Court is in the opinion that the judgment of the trial court, dated the 17th of December,
1904, wherein it is declared that Telesforo Alo is not the legitimate owner of the land described in the
complaint, should be reversed, and we hereby condemn Clodoaldo Rocamora to return to the plaintiff,
Telesforo Alo, the land in question and the crops growing thereon.
The plaintiff, Telesforo Alo, took possession of the land as owner when he bought it on November 5,
1888, about ten years before the usurpation of the land, or of the alleged purchase of the same made in
1897, although this bona fide purchase of the land has not been proved in this case, nor is there any
evidence to show the disappearance or loss of the document or documents evidencing the acquisition of
the said land. Section 321 of the Code of Civil Procedure provides that original writings must be produced
and proved, and if they have been lost, proof of the loss must first be made, before evidence can be
given of their contents.
It is true that the title introduced in evidence by the plaintiff did not appear to have been recorded in the
Registry of Property, but the defendant has failed to establish his ownership of the land by means of any
document or title recorded or unrecorded in the said registry.
There can be no doubt that under article 606 of the Civil Code titles of ownership of real estate which are
not properly recorded or entered in the Registry of Property shall not prejudice the rights of third persons;
but the supreme court of Spain in construing this article of the code held in its judgment of December
16, 1892, that "from the fact that the ownership of the piece of property is not recorded in the registry
in favor of the person in possession thereof, it can not be inferred that such person is not the owner of
the property, provided it be shown that he acquired the same, that the property is not registered in the
name of another, and that he has been in the quiet and peaceful possession thereof."
The plaintiff in this case was not in the physical possession of the land for the reason that he lived upon
other property owned by him, but it has been shown that he exercised acts of ownership and possession
over the land in question through his agents, Pedro Gonzalez and Hilario Ogsimar, the former owner,
who continued to live upon the property and to dispose of its products in the exercise of a legitimate and
perfect right. Article 431 of the Civil Code provides as follows:
"Possession of things or rights is exercised either by the same person who holds and enjoys them or by
another in his name." Under the last clause of this article, the plaintiff in this case was in possession of
the said land, as has been fully proved.
RAMOS VS. DIRECTOR OF LANDS
The general rule is that possession and cultivation of a portion of a tract of land under the claim of
ownership of all is a constructive possession of all, if the remainder is not in the adverse possession of
another.
FACTS:
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Restituto Romero gained possession of a considerable tract of land located in Nueva Ecija. He took
advantage of the Royal Decree to obtain a possessory information title to the land and was registered as
such. Parcel No. 1 included within the limits of the possessory information title of Romero was sold to
Cornelio Ramos, herein petitioner. Ramos instituted appropriate proceedings to have his title registered.
Director of Lands opposed on the ground that Ramos had not acquired a good title from the Spanish
government.
Director of Forestry also opposed on the ground that the first parcel of land is forest land.
It has been seen however that the predecessor in interest to the petitioner at least held this tract of land
under color of title.
ISSUE: Whether 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?
HELD: The general rule is that possession and cultivation of a portion of a tract of land under the claim
of ownership of all is a constructive possession of all, if the remainder is not in the adverse possession of
another. The claimant has color of title; he acted in good faith and he has 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 supposition that the premises consisted of agricultural
public land.
On the issue of 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.
In this case, the 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. Petitioner
and appellant has proved a title to the entire tract of land for which he asked for registration. Registration
in the name of the petitioner is hereby granted.
Arriola vs. Gomez de la Serna., 14 Phil. 627, No. 5397 December 17, 1909
In order that ownership and other property rights in real property shall prescribe by possession, it is
necessary to occupy in good faith and with proper title.
Good faith consists in the possessor's belief that the person from whom he received a thing was the
owner of the same and could convey his title. Any person who is not aware that there is in his title, or in
the manner of acquiring it, any flaw invalidating the same, shall be considered a possessor in good faith.
Good faith is always presumed, and any person alleging bad faith on the part of the possessor is obliged
to prove it. A person occupying and possessing real property under a claim of hereditary title will not
suffer the consequences of the faulty possession of his ancestor unless it is proved that he had knowledge
of the defects affecting it.

Facts:
This is an action of ejectment brought for the recovery of a parcel of land situated in the city of Manila,
at the corner of Calles San Luis and Nueva. The plaintiff sues as administratrix of the estate of her mother,
Simona Cabrera, who died some years ago. She has no documentary title whatever and relies upon the
testimony of witnesses to the effect that her mother was in possession of the land until about 1882, when
she was ousted by an order of the court and possession of the premises was taken by Jose M. Perez
Rubio.
The defendant shows title in herself and her minor children by inheritance from her deceased husband,
Jose M. Perez Rubio, under a contract of distribution among his heirs. It appears also upon the defendant's
showing that said Jose M. Perez Rubio acquired title by a conveyance executed by the Court of Quiapo
on the 21st day of December, 1881, and that, immediately upon said conveyance, he entered into
possession of the property and he and his heirs have continued in possession thereof under claim of
ownership, publicly, peacefully, and without interruption, down to the time of the commencement of this
action.
The. plaintiff contends that the possession of Jose M. Perez Rubio of the land in question was not in good
faith, as required by law, and assigns as a reason for that contention that, subsequent to the conveyance
mentioned, the opponent of Rubio made an application to the court in the action in which said conveyance
was obtained asking that the cause be reheard and that the order of said court which was the basis of
said conveyance be suspended until the cause could be retried; that, pursuant to such application, said
cause was reopened and said order and its operation were suspended; that nothing further was done in
said action by either party, and that, therefore, the effect of the order of conveyance having been annulled
by a suspension of the same and the reopening of the case for a rehearing, Rubio had no proper title or
color thereof when he took possession of said land, and he, therefore, continued in possession knowing
the defect in his title; and that said Rubio, being himself a lawyer, can not be heard to plead ignorance
to protect his possession from the taint of bad faith.
Held:
We find, however, that it is not necessary to discuss or decide that question because the defendant in
this action claims ownership of said land not only by virtue of the possession and rights therein of her
husband, Rubio, but also by virtue of her own personal occupancy and possession of the same for more
than 10 years, in good faith and just title, basing the same upon inheritance from her húsband and a
contract of distribution among his heirs under which she was awarded the land in question.
Article 1957 of the Civil Code provides that ownership and other property rights in real property shall
prescribe by possession for ten years as to persons present, and for twenty years with regard to those
absent, with good faith and with proper title. Article 1950 of the same code provides that good faith of
the possessor consists in his belief that the person from whom he received the thing was the owner of
the same and could convey his title. Article 433 provides that any person who is not aware that there is
in his title or in the manner of acquiring it any flaw invalidating the same shall be considered a possessor
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in good faith. Article 434 provides that good faith is always presumed and any person alleging bad faith
on the part of the possessor is obliged to prove it.
That defendant has been possessing since 1896 under a proper title, as defined by law, is undoubted. It
is equally unquestioned that the defendant has been occupying and possessing in good faith unless the
alleged bad faith on the part of her husband can be imputed to her. Article 442 of the Civil Code provides
that a person inheriting by hereditary title shall not suffer the consequences of faulty possession of the
testator unless it is proved that he had knowledge of the defects affecting it.
There being no proof in the record that the defendant had knowledge of the defects, if any, in the title
of her husband, the question of good faith upon his part in possessing such land is of no consequence in
the decision of this case. The defendant, having taken possession of the land in dispute on the 15th day
of February 1896, in good faith and with a proper title, and having publicly, peacefully and uninterruptedly
possessed the same down to the date on which this action was commenced, viz., October 17, 1908, it is
evident that the defendant is the owner of said land by virtue of prescription.
Bukidnon Doctor’s Hospital vs. MBTC (GR 161882)
Facts:
In this case, petitioner (Bukidnon Doctors’ Hospital, Inc.) was a mortgagor of respondent (MBTC). Upon
petitioner’s failure to pay the mortgage obligation, respondent foreclosed the mortgage and acquired the
property during the public auction. Petitioner likewise failed to redeem the foreclosed property from the
respondent within the redemption period. Subsequently, however, the parties entered into a lease
agreement to enable the petitioner to continue its operation. After almost two years after said agreement,
respondent demanded that the petitioner vacate the leased premises. When the petitioner refused,
respondent initiated an ex parte proceeding for the issuance of a writ of possession.
Issue: Whether the issuance of a writ of possession for the purpose of evicting a mortgagor who became
a lessee of the mortgaged properties after the mortgagee acquired ownership thereof.
Held: “The law and jurisprudence are clear that in extrajudicial foreclosure proceedings, an order for a
writ of possession issues as a matter of course, upon proper motion, after the expiration of the redemption
period without the mortgagor exercising the right of redemption, or even during the redemption period
provided a bond is posted to indemnify the debtor in case the foreclosure sale is shown to have been
conducted without complying with the requirements of the law or without the debtor violating the mortgage
contract.
The rationale for the ministerial issuance of a writ of possession is to put the foreclosure buyer in
possession of the property sold without delay, since the right to possession is founded on ownership of
the property. However, in the instant case, a writ of possession was not the correct remedy for the purpose
of ousting the petitioner from the subject premises. It must be noted that possession is the holding of a
thing or the enjoyment of a right. It is acquired by the material occupation of a thing or the exercise of a
right, or by the fact that a thing or right is subject to the action of one’s will, or by the proper acts and legal
formalities established for acquiring such right. ‘By material occupation of a thing,’ it is not necessary that

the person in possession should be the occupant of the property; the occupancy can be held by another
in his name.
Thus Articles 524 and 525 of the Civil Code provide: Art. 524. Possession may be exercised in one’s own
name or in that of another. Art. 525. The possession of things or rights may be had in one of two concepts:
either in the concept of owner, or in that of the holder of the thing or right to keep or enjoy it, the ownership
pertaining to another person. In other words, an owner of a real estate has possession, either when he
himself is physically occupying the property, or when another person who recognizes his rights as owner
is occupying it. In the case at bar, it is not disputed that after the foreclosure of the property in question
and the issuance of new certificates of title in favor of the respondent, the petitioner and the respondent
entered into a contract of lease of the subject properties.
This new contractual relation presupposed that the petitioner recognized that possession of the properties
had been legally placed in the hands of the respondent, and that the latter had taken such possession
but delivered it to the former as lessee of the property. By paying the monthly rentals, the petitioner also
recognized the superior right of the respondent to the possession of the property as owner thereof. And
by accepting the monthly rentals, the respondent enjoyed the fruits of its possession over the subject
property. Clearly, the respondent is in material possession of the subject premises. Thus, the trial court’s
issuance of a writ of possession is not only superfluous, but improper under the law. Moreover, as a
lessee, the petitioner was a legitimate possessor of the subject properties under Article 525 of the Civil
Code. Thus, it could not be deprived of its lawful possession by a mere ex parte motion for a writ of
possession. x x x In a nutshell, where a lease agreement, whether express or implied, is subsequently
entered into by the mortgagor and the mortgagee after the expiration of the redemption period and the
consolidation of title in the name of the latter, a case for ejectment or unlawful detainer, not a motion for
a writ of possession, is the proper remedy in order to evict from the questioned premises a mortgagor-
turned-lessee.
The rationale for this rule is that a new relationship between the parties has been created. What applies
is no longer the law on extrajudicial foreclosure, but the law on lease. And when an issue arises, as in the
case at bar, regarding the right of the lessee to continue occupying the leased premises, the rights of the
parties must be heard and resolved in a case for ejectment or unlawful detainer under Rule 70 of the
Rules of Court.”
Carlos vs. Republic of the Philippines
Facts:
On December 19, 2001, petitioner Maria Carlos, represented by her daughter, Teresita Carlos Victoria,
filed an application for registration and confirmation of title over a parcel of land with an area of 3,975
square meters located at Pusawan, Ususan, Taguig, Metro Manila, covered by Plan Psu-244418. Petitioner
alleged, among others, that she is the owner of said parcel of land which she openly, exclusively and
notoriously possessed and occupied since July 12, 1945 or earlier under a bona fide claim of ownership;
that there is no mortgage or encumbrance affecting said property, nor is it part of any military or naval
reservation; that the property is being used for industrial purposes; and that there are no tenants or
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lessees on the property. Petitioner further claimed that she has been in possession of the subject land in
the concept of an owner; that her possession has been peaceful, public, uninterrupted and continuous
since 1948 or earlier; and tacking her possession with that of her predecessors-in-interest, petitioner has
been in possession of the land for more than 50 years.[1]
Sergio Cruz, 83 years old, a native of Ususan, Taguig, and neighbor of Maria Carlos, testified that the
property subject of the application was previously owned and possessed by Jose Carlos. He planted it
with palay and sold the harvest. Everyone in the community knew him as the owner of said parcel of
land. He also paid the taxes thereon. After the death of Jose Carlos in 1948, his daughter, Maria Carlos,
inherited the property and immediately took possession thereof. Her possession was peaceful, open,
public, continuous, uninterrupted, notorious, adverse and in the concept of an owner. When Maria Carlos
died, her heirs took over the property.[5]
Teresita Carlos Victoria stated on the witness stand that her mother, Maria Carlos, was in possession of
the subject property until she passed away on January 6, 2001. Upon the demise of Maria Carlos, Victoria
took possession of the property with the consent of her brothers and sisters. She characterized Maria
Carloss possession as peaceful, open, public, continuous, adverse, notorious and in the concept of an
owner. She has never been disturbed in her possession; the whole community recognized her as the
owner of the land; she declared the land for tax purposes; and she paid the taxes thereon. In addition,
Victoria informed the court that the heirs of Maria Carlos have not yet instituted a settlement of her
estate. However, they have agreed to undertake the titling of the property and promised to deliver the
certificate of title to Ususan Development Corporation which bought the property from Maria Carlos.
Victoria admitted that her mother had sold the land to Ususan Development Corporation in 1996 but
failed to deliver the title. Hence, the heirs of Maria Carlos made a commitment to the corporation to
deliver the certificate of title so that they could collect the unpaid balance of the purchase price. [7]
Ulysses Sigaton, Land Management Inspector, DENR National Capital Region, stated that he conducted
an ocular inspection of the subject property and found that it is within the alienable and disposable area
under Project No. 27-B, LC Map No. 2623, certified by the Bureau of Forest Development on January 4,
1968. He also noted that the land is being used for industrial purposes. It had several warehouses, four
big water tanks and is enclosed by a fence.[9]
The trial court granted the application in its decision dated October 24, 2002. It held:
After considering the applicants evidence ex-parte which is based on factual and
meritorious grounds, and considering that the applicant acquired the property under
registration through inheritance from her father, Jose Carlos, and considering further
that her possession thereof, tacked with that of her predecessor-in-interest, is open,
continuous, exclusive, notorious and undisturbed, under claim of ownership since time
immemorial up to the present time; and considering further that the subject parcel of
land is part of the disposable and alienable land.

On appeal, the Court of Appeals reversed and set aside the decision of the trial court. It noted that:
In the instant case, the applicant at the time she filed her application for registration
of title was no longer in possession and occupation of the land in question since on
October 16, 1996, the applicants mother and predecessor-in-interest sold the subject
land to Ususan Development Corporation. This was admitted by witness Teresita Carlos
Victoria x x x Clearly, as early as 1996, possession and occupation of the land in
question pertains not to the applicant but to Ususan Development Corporation, thus it
can be said that the applicant has no registrable title over the land in question. [11]
Held:
The Court agrees with the appellate court. We therefore find that the Court of Appeals did not err in
denying the issuance of a certificate of title to petitioner. Applicants for confirmation of imperfect title
must prove the following: (a) that the land forms part of the disposable and alienable agricultural lands
of the public domain; and (b) that they have been in open, continuous, exclusive, and notorious
possession and occupation of the same under a bona fide claim of ownership either since time
immemorial or since June 12, 1945. [12]As found by the Court of Appeals, petitioner has met the first
requirement but not the second.
The Court held in Republic vs. Alconaba[13] that the applicant must show that he is in actual
possession of the property at the time of the application, thus:
The law speaks of possession and occupation. Since these words are separated by the
conjunction []and[], the clear intention of the law is not to make one synonymous with
the other. Possession is broader than occupation because it includes constructive
possession. When, therefore, the law adds the word occupation, it seeks to delimit the
all-encompassing effect of constructive possession. Taken together with the words
open, continuous, exclusive and notorious, the word occupation serves to highlight the
fact that for an applicant to qualify, his possession must not be a mere fiction. Actual
possession of a land consists in the manifestation of acts of dominion over it of such a
nature as a party would naturally exercise over his own property.
It is clear in the case at bar that the applicant, Maria Carlos, no longer had possession of the property at
the time of the application for the issuance of a certificate of title. The application was filed in court on
December 19, 2001. Teresita Carlos Victoria, the daughter of Maria Carlos, admitted during the hearing
that her mother had sold the property to Ususan Development Corporation in 1996. They also presented
as evidence the deed of absolute sale executed by and between Maria Carlos and Ususan Development
Corporation on October 16, 1996.[14] The document states, among others:
xxx
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MIDTERMS CASE DIGEST IN PROPERTY- TIAMZON 6
4. That the VENDOR, by this Deed hereby transfer(s) possession of the property to the
VENDEE.[15]
This contradicts petitioners claim that she was in possession of the property at the time that she applied
for confirmation of title.
Nonetheless, even if it were true that it was petitioner who had actual possession of the land at that time,
such possession was no longer in the concept of an owner. Possession may be had in one of two ways:
possession in the concept of an owner and possession of a holder. A possessor in the concept of an owner
may be the owner himself or one who claims to be so. On the other hand, one who possesses as a mere
holder acknowledges in another a superior right which he believes to be ownership, whether his belief
be right or wrong.[16] Petitioner herein acknowledges the sale of the property to Ususan Development
Corporation in 1996 and in fact promised to deliver the certificate of title to the corporation upon its
obtention. Hence, it cannot be said that her possession since 1996 was under a bona fide claim of
ownership. Under the law, only he who possesses the property under a bona fide claim of ownership is
entitled to confirmation of title.
KASILAG VS ROQUE
Facts:
The respondents, children and heirs of the deceased Emiliana Ambrosio, commenced the aforesaid civil
case to the end that they recover from the petitioner the possession of the land and its improvements
granted by way of homestead to Emiliana Ambrosio under patent No. 16074 issued on January 11, 1931,
with certificate of title No. 325 that the petitioner pay to them the sum of P650 being the approximate
value of the fruits which he received from the land; that the petitioner sign all the necessary documents
to transfer the land and its possession to the respondents; that he petitioner be restrained, during the
pendency of the case, from conveying or encumbering the land and its improvements; that the registrar
of deeds of Bataan cancel certificate of title No. 325 and issue in lieu thereof another in favor of the
respondents, and that the petitioner pay the costs of suit.
The petitioner denied in his answer all the material allegations of the complaint and by way of special
defense alleged that he was in possession of the land and that he was receiving the fruits thereof by
virtue of a mortgage contract, entered into between him and the deceased Emiliana Ambrosio on May
16, 1932, which was duly ratified by a notary public;
One year after the execution of the aforequoted deed, that is, in 1933, it came to pass that Emiliana
Ambrosio was unable to pay the stipulated interests as well as the tax on the land and its improvements.
For this reason, she and the petitioner entered into another verbal contract whereby she conveyed to the
latter the possession of the land on condition that the latter would not collect the interest on the loan,
would attend to the payment of the land tax, would benefit by the fruits of the land, and would introduce

improvements thereon. By virtue of this verbal contract, the petitioner entered upon the possession of
the land, gathered the products thereof, did not collect the interest on the loan, introduced improvements
upon the land valued at P5,000, according to him and on May 22, 1934 the tax declaration was transferred
in his name and on March 6, 1936 the assessed value of the land was increased from P1,020 to P2,180.
Issue: Whether the petitioner should be deemed a possessor in good faith
Held: According to this author, gross and inexcusable ignorance of law may not be the basis of good
faith, but possible, excusable ignorance may be such basis. It is a fact that the petitioner is not conversant
with the laws because he is not a lawyer. In accepting the mortgage of the improvements he proceeded
on the well-grounded belief that he was not violating the prohibition regarding the alienation of the land.
In taking possession thereof and in consenting to receive its fruits, he did not know, as clearly as a jurist
does, that the possession and enjoyment of the fruits are attributes of the contract of antichresis and
that the latter, as a lien, was prohibited by section 116. These considerations again bring us to the
conclusion that, as to the petitioner, his ignorance of the provisions of section 116 is excusable and may,
therefore, be the basis of his good faith. We do not give much importance to the change of the tax
declaration, which consisted in 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 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, therefore, hold that the petitioner acted in good faith in taking possession of the land and
enjoying its fruits.
Heirs of Laurora vs. Sterling Technopark (2003)
Only prior physical possession, not title, is the issue.—The only issue in forcible entry cases is the physical
or material possession of real property—possession de facto, not possession de jure. Only prior physical
possession, not title, is the issue. If ownership is raised in the pleadings, the court may pass upon such
question, but only to determine the question of possession.
A person in possession cannot be ejected by force, violence or terror—not even by the owners.—
Notwithstanding the actual condition of the title to the property, a person in possession cannot be ejected
by force, violence or terror—not even by the owners. If such illegal manner of ejectment is employed, as
it was in the present case, the party who proves prior possession—in this case, petitioners—can recover
possession even from the owners themselves.
Verily, even if petitioners were mere usurpers of the land owned by respondents, still they are entitled to
remain on it until they are lawfully ejected therefrom. Under appropriate circumstances, respondents may
file, other than an ejectment suit, an accion publiciana—a plenary action intended to recover the better
right to possess; or an accion reivindicatoria—an action to recover ownership of real property.
The owners of a property have no authority to use force and violence to eject alleged usurpers who were
in prior physical possession of it. They must file the appropriate action in court and should not take the
law into their own hands.
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MIDTERMS CASE DIGEST IN PROPERTY- TIAMZON 7
Facts:
In a [C]omplaint for Forcible Entry with Damages filed on 27 September 1997 before the Fifth Municipal
Circuit Trial Court of Carmona and Gen. Mariano Alvarez, plaintiffs therein, x x x Pedro Laurora and
Leonora Laurora [herein petitioners] alleged that they [were] the owners of Lot 1315-G, SWD-40763 of
the Yaptinchay Estate with an area of 39,771 sq. meters and located in Carmona, Cavite. Pedro Laurora
planted trees and has possessed the land up to the present. On 15 September 1997, [respondents]
Sterling Technopark III and S.P. Properties, Inc. x x x through their Engr. Bernie Gatchalian bulldozed
and uprooted the trees and plants, and with the use of armed men and by means of threats and
intimidation, succeeded in forcibly ejecting [petitioners]. As a result of their dispossession, [petitioners]
suffered actual damages in the amount of P3,000,000.00 and P10,000.00 as attorney’s fees.
In their [A]nswer to the [C]omplaint, [respondents] averred that [petitioners were] not the owners of
the land because they disposed of it sometime in 1976 as shown by legal documents. On 02 April 1969,
the Land Authority issued an order of award in favor of [petitioners], approving the application of Pedro
Laurora to buy the subject Lot 1315-G from the government. On 01 March 1974, [petitioners] requested
the Department of Agrarian Reform for the transfer of the lot to Juan Manaig. Favorably acted upon, the
DAR issued a permit to transfer dated 03 June 1975 through its Regional Director Benjamin R. Estrellado.
On 03 July 1975, Juan Manaig, as transferee and buyer, paid the required amount of P10,643.65 under
Official Receipt No. 8304707 to the government as full payment for the transfer of said lot to him. On 26
March 1976, the [petitioners] as sellers and witnessed by their sons, Efren Laurora and Dominador
Laurora, executed a ‘Kasulatan ng Paglilipatan ng Lupa’ transferring the land to Juan Manaig as buyer.
On 11 June 1976, the [petitioners] again witnessed by their sons, Efren and Dominador, executed a
‘Kasulatan ng Bilihang Tuluyan’ or Deed of Sale wherein they sold Lot 1315-G including all improvements
therein, in favor of Juan Manaig. The Deed of Absolute Sale was approved by the Department of Agrarian
Reform on 14 June 1976 in ‘DAR Approval of Transfer of Rights’ signed by DAR Regional Director,
Benjamin R. Estrellado. After the approval of the sale from the [petitioners] to Juan Manaig, the latter
paid its real estate taxes. The tax declarations of the land in the name of its previous owners, Yaptinchays,
were cancelled and transferred in the name of [petitioner] Pedro Laurora as owner-transferee.
Thereupon, the heirs of the late ‘JUAN MANAIG’ sold the land to Golden Mile Resources Development
Corporation which likewise sold it to [respondent] S. P. Properties, Inc.
“After summary proceedings in the MCTC, x x x, a judgment was rendered dismissing the complaint. The
case was elevated to the Regional Trial Court. In due course, the said court rendered a decision reversing
the MCTC judgment. x x x”6
Ruling of the Court of Appeals
The CA reversed the Regional Trial Court (RTC) and reinstated the Order of dismissal issued by the
Municipal Circuit Trial Court (MCTC). It held that there was no evidence to support the claim of petitioners
to the prior physical possession of the property. The evidence allegedly showed that they had already
sold the land with the approval of the Department of Agrarian Reform (DAR). Accordingly, their
subsequent entry into and possession of the land constituted plain usurpation, which could not be the

source of any right to occupy it. Being planters in bad faith, they had no right to be reimbursed for
improvements on the land, in accordance with Article 449 of the New Civil Code.
Issue:
[W]hether [p]rivate [r]espondent[s] ha[ve] a valid and legal right to forcibly eject petitioners from the
premises despite their resistance and objection, through the use of arm[ed] men and by bulldozing,
cutting, and destroying trees and plants planted by petitioners, without court order, to the damage and
prejudice of the latter.
Held:
The Petition is meritorious.
Physical Possession of the Land
The only issue in forcible entry cases is the physical or material possession of real property—possession
de facto, not possession de jure.10 Only prior physical possession, not title, is the issue. If ownership is
raised in the pleadings, the court may pass upon such question, but only to determine the question of
possession.12
The ownership claim of respondents upon the land is based on the evidence they presented. Their
evidence, however, did not squarely address the issue of prior possession. Even if they succeed in proving
that they are the owners of the land,13 the fact remains that they have not alleged or proved that they
physically possess it by virtue of such ownership. On the other hand, petitioners’ prior possession of the
land was not disputed by the CA, which merely described it as usurpation.14
We stress that the issue of ownership in ejectment cases is to be resolved only when it is intimately
intertwined with the issue of possession,15 to such an extent that the question of who had prior
possession cannot be determined without ruling on the question of who the owner of the land is.16 No
such intertwinement has been shown in the case before us. Since respondents’ claim of ownership is not
being made in order to prove prior possession, the ejectment court cannot intrude or dwell upon the
issue of ownership.17
Notwithstanding the actual condition of the title to the property, a person in possession cannot be ejected
by force, violence or terror—not even by the owners.18 If such illegal manner of ejectment is employed,
as it was in the present case, the party who proves prior possession—in this case, petitioners—can recover
possession even from the owners themselves. Granting arguendo that petitioners illegally entered into
and occupied the property in question, respondents had no right to take the law into their own hands
and summarily or forcibly eject the occupants therefrom.
Verily, even if petitioners were mere usurpers of the land owned by respondents, still they are entitled to
remain on it until they are lawfully ejected therefrom. Under appropriate circumstances, respondents may
file, other than an ejectment suit, an accion publiciana—a plenary action intended to recover the better
right to possess;20 or an accion reivindicatoria—an action to recover ownership of real property.21
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MIDTERMS CASE DIGEST IN PROPERTY- TIAMZON 8
The availment of the aforementioned remedies is the legal alternative to prevent breaches of peace and
criminal disorder resulting from the use of force by claimants out to gain possession.22 The rule of law
does not allow the mighty and the privileged to take the law into their own hands to enforce their alleged
rights. They should go to court and seek judicial vindication.
Where the issue is possession de facto not de jure, the proper remedy is ejectment, not accion publiciana.
(Cañiza vs. Court of Appeals, 268 SCRA 640 [1997])
Chua vs. Court of Appeals, 301 SCRA 356, G.R. No. 109840 January 21, 1999
The lessor is given the option to pay the lessee for useful improvements made by the latter but the lessee
does not have a right to demand that he be paid therefor. A building such as a family residential house
is deemed an “improvement” for purposes of Article 1678 of the Civil Code.
Facts:
Petitioners were lessees of a commercial unit at No. 3086 Redemptorist Street in Baclaran, Parañaque,
Metro Manila. The lease was for a period of five (5) years, from January 1, 1985 to December 31, 1989.
The contract expressly provided for the renewal of the lease at the option of the lessees “in accordance
with the terms of agreement and conditions set by the lessor.” Prior to the expiration of the lease, the
parties discussed the possibility of renewing it. They exchanged proposal and counterproposal, but they
failed to reach agreement. The dispute was referred to the barangay captain for conciliation but still no
settlement was reached by the parties.
Private respondent filed a complaint for unlawful detainer against petitioners in the Metropolitan Trial
Court of Parañaque, Metro Manila.
On appeal by both parties, the Regional Trial Court, Branch 59 of Makati ruled that the lease was for a
fixed period of five (5) years and that, upon its expiration on January 1, 1990, petitioners’ continued stay
in the premises became illegal. As provided in Art. 1687 of the Civil Code, the power of the courts to fix
the period of lease is limited only to cases where the period has not been fixed by the parties themselves.
Petitioners appealed to the Court of Appeals which affirmed the decision. Petitioners’ motion for
reconsideration was likewise denied. Hence, this petition for review on certiorari.
First. Petitioners allege that the Court of Appeals erred in affirming the lower court’s finding that they
owe private respondent the amount of P42,306.00 as unpaid rentals from January 1, 1987 to December
31, 1989 because neither the letter of demand nor the complaint for unlawful detainer alleged a claim
for unpaid rentals. As the Court of Appeals pointed out, however, the issue of arrearages was raised at
the pre-trial by private respondent and evidence on this question was presented without objection from
petitioners:5
Issue: Whether the plaintiff had a valid cause of action for ejectment against them as he is not the sole
owner of the leased premises.
Held:

There is no provision of law which grants the lessee a right of retention over the leased premises on the
ground that he made repairs on the premises—Article 448 of the Civil Code, in relation to Article 546,
which provides for full reimbursement of useful improvements and retention of the premises until
reimbursement is made, applies only to a possessor in good faith, i.e., one who builds on a land in the
belief that he is the owner thereof.—The appellate court found petitioners guilty of bad faith in refusing
to leave the premises. But petitioners contend that they acted in good faith under the belief that they
were entitled to an extension of the lease because they had made repairs and improvements on the
premises. This contention is devoid of merit. The fact that petitioners allegedly made repairs on the
premises in question is not a reason for them to retain the possession of the premises. There is no
provision of law which grants the lessee a right of retention over the leased premises on that ground.
Art. 448 of the Civil Code, in relation to Art. 546, which provides for full reimbursement of useful
improvements and retention of the premises until reimbursement is made, applies only to a possessor in
good faith, i.e., one who builds on a land in the belief that he is the owner thereof. In a number of cases,
the Court has held that this right does not apply to a mere lessee, like the petitioners, otherwise, it would
always be in his power to “improve” his landlord out of the latter’s property. Art. 1678 merely grants to
such a lessee making in good faith useful improvements the right to be reimbursed one-half of the value
of the improvements upon the termination of the lease, or, in the alternative, to remove the improvements
if the lessor refuses to make reimbursement.
LORENZA ALBURO vs. CATALINA VILLANUEVA (1907)
The word "repairs" as used in paragraph 2 of article 1554 of the Civil Code implies the putting of
something back into the condition in which it was originally and not an improvement in the condition
thereof by adding something new thereto, hence the filling in of a vacant lot is not a repair in the sense
in which the word is used in this article.
Necessary expenses (gastos necesarios) as used in article 453 of the Civil Code are "no others than those
made for the preservation of the thing upon which they have been expended." A tenant holding under a
rental contract is not entitled to indemnification under the provisions of article 361 of the Civil Code.
Facts:
It appears that the plaintiff is the owner, by inheritance from her grandfather, of a certain lot of land in
the city of Manila which, by written contract, was rented on the 23d day of January, 1892, to one Antonio
Susano Goenco, for a term of six years, with the privilege of renewal for a second term of six years; that
the defendant, who is the wife of the said Goenco, came into possession by virtue of this rental contract;
that the defendant and her husband expended a considerable sum of money filling in and leveling the lot
and that they built a house of hard materials thereon; and that the rental contract, while it expressly
permitted the tenant to build upon the lot, is silent as to the disposition of the house at the expiration of
the rental term and makes no express provision as to improvements to be made upon the land by way
of leveling or otherwise.
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MIDTERMS CASE DIGEST IN PROPERTY- TIAMZON 9
The defendant having refused to surrender the lot in question at the expiration of the rental term, this
action was brought to recover possession thereof and judgment was rendered for the plaintiff, reserving
to the defendant the right to remove the house from the lot.
Counsel for the defendant contends that she is entitled to a renewal of the rental contract for a third term
of six years; or if this be denied, to be reimbursed for expenditures in filling in and leveling the lot, and
to have the benefits of the provisions of article 361 of the Civil Code, wherein it is provided that—
"The owner of the land on which building, sowing, or planting is done in good faith shall have a right to
appropriate as his own the work, sowing, or planting, having previously paid the indemnity mentioned in
articles four hundred and fifty-three and four hundred and fifty-four, or to oblige the person who has
built or planted to pay him the value of the land."
It is said that this rental contract should be construed in accordance with the provisions of articles
1281,1282,1288, and 1289 of the Civil Code so as to give the defendant the right to renew the contract
for a third term of six years, and so on indefinitely so long as she faithfully paid the rent, but we are of
opinion that there is no room for interpretation in accordance with the provisions of these articles since
the contract expressly provides for a term of a definite number of years, with a privilege of renewal for a
second term of a definite number of years. This is a very usual form of rental contract and its terms are
so clear and explicit that they do not justify an attempt to read into it any alleged intention of the parties
other than that which appears upon its face.
In support of her claim for reimbursement for expenses in filling in and leveling the lot, defendant relies
on the provisions of paragraph 2 of article 1554 of the Civil Code, wherein it is provided that the landlord
is obliged "during the lease to make all necessary repairs in order to preserve the thing rented in condition
to serve for the purpose to which it was destined."
Manresa points out:
This article is strictly limited in its effect to repairs necessary to preserve the thing rented in a condition
suitable to the use agreed upon (para el uso pactado). A repair implies the putting of something back
into the condition in which it was originally and not an improvement in the condition thereof by adding
something new thereto, unless the new thing be in substitution of something formerly in existence and
is added to preserve the original status of the subject-matter of the repairs; the filling in of a vacant lot
can not be regarded as a repair as the word is used in this article; and even though it could be so
considered, the remedy of the tenant under the provisions of article 1556, when the landlord fails to
make necessary repairs, is by demand for the annulment of the contract and indemnity by way of
damages or without demanding annulment of the contract by demand for damages for negligence on the
part of the landlord; and the tenant is not authorized to make such repairs at the expense of the landlord,
except when it is a matter of the most urgent necessity (reparación urgentísima) "where the slightest
delay would involve grave damages," when the tenant may take the absolutely necessary means to avoid
the loss, at the cost of the owner, doing only that which is required by the force of circumstances and no
more, but this the ground that "he had acted by virtue of the social duty of mutual aid and assistance."

It has been suggested that the claim of the defendant for compensation for the filling in and leveling of
the lot may be based upon article 453 of the Civil Code which provides that "necessary expenditures will
be repaid to all persons in possession (los gastos necesarios se abonan á todo poseedor)." It may be
doubted, however, whether the "possessor" referred to in this provision can be said to include one who
stands in relation of tenant to his landlord, for the above-cited article 1554 of the Civil Code, and the
chapter wherein it occurs, seem to provide for such cases; and in any event we do not think that the
filling in and improvement of a lot can be brought under the head of necessary expenses (gastos
necesarios) as used in this connection. Manresa in his commentaries upon this article says that gastos
necesarios are no others than those made for the preservation of the thing upon which they have been
expended.
The contention that the defendant is entitled to the benefits of the provisions of article 361 of the Civil
Code can not be maintained because the right to indemnification secured in that article is manifestly
intended to apply only to a case where one builds or sows or plants on land in which he believes himself
to have a claim of title and not to lands wherein one's only interest is that of tenant under a rental
contract; otherwise it would always be in the power of the tenant to improve his landlord out of his
property. The right of a tenant in regard to improvements (mejoras) is expressly provided for in article
1573 read in connection with article 487, wherein it is provided that the tenant may make such
improvements, either useful or convenient, as he considers advantageous, provided he does not alter the
form and substance of the thing rented, but that he will have no right for indemnification therefor, though
he can take away such improvements if it is possible to do so without injury or damage to the thing
rented.
The trial court authorized the removal of the house, apparently relying on the provisions of this article.
Metropolitan Waterworks and Sewerage System vs. Court of Appeals, 143 SCRA 623, No. L-
54526 August 25, 1988
Civil Law; Property; Possession; Builder in bad faith, not entitled to whatever useful improvements it
had made without right to indemnity.
Article 449 of the Civil Code of the Philippines provides that “he who builds, plants or sows in bad faith
on the land of another, loses what is built, planted or sown without right to indemnity.” As a builder in
bad faith, NAWASA lost whatever useful improvements it had made without right to indemnity
Rights of a possessor in good faith and a possessor in bad faith
Moreover, under Article 546 of said code, only a possessor in good faith shall be refunded for useful
expenses with the right of retention until reimbursed; and under Article 547 thereof, only a possessor in
good faith may remove useful improvements if this can be done without damage to the principal thing
and if the person who recovers the possession does not exercise the option of reimbursing the useful
expenses. The right given a possessor in bad faith is to remove improvements applies only to
improvements for pure luxury or mere pleasure, provided the thing suffers no injury thereby and the
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MIDTERMS CASE DIGEST IN PROPERTY- TIAMZON 10
lawful possessor does not prefer to retain them by paying the value they may have at the time he enters
into possession (Article 549, Id.).
Useful expenses are incurred to give greater utility or productivity to the thing. They are reimbursed only
to the possessor in good faith as a compensation or reward for him. The possessor in bad faith, on the
other hand, knowing his want of right, cannot claim reimbursement for expenses incurred to increase his
own benefit from the thing hence, he is not allowed to recover such expenses, (Tolentino, Civil Code of
the Philippines, Vol. II, 1983 Ed., p. 261.)
Facts:
The City of Dagupan (hereinafter referred to as the CITY) filed a complaint against the former National
Waterworks and Sewerage Authority (hereinafter referred to as the NAWASA), now the Metropolitan
Waterworks and Sewerage System (hereinafter referred to as MWSS), for recovery of the ownership and
possession of the Dagupan Waterworks System. NAWASA interposed as one of its special defenses R.A.
1383 which vested upon it the ownership, possession and control of all waterworks systems throughout
the Philippines and as one of its counterclaims the reimbursement of the expenses it had incurred for
necessary and useful improvements amounting to P255,000.00.
Judgment was rendered by the trial court in favor of the CITY on the basis of a stipulation of facts. The
trial court found NAWASA to be a possessor in bad faith and hence not entitled to the reimbursement
claimed by it. NAWASA appealed to the then Court of Appeals and argued in its lone assignment of error
that the CITY should have been held liable for the amortization of the balance of the loan secured by
NAWASA for the improvement of the Dagupan Waterworks System. The appellate court affirmed the
judgment of the trial court and ruled as follows:
“However, as already found above, these useful expenses were made in utter bad faith for they were
instituted after the complaint was filed and after numerous Supreme Court decisions were promulgated
declaring unconstitutional the taking by NAWASA of the patrimonial waterworks systems of cities,
municipalities and provinces without just compensation.
“Under Article 546 of the New Civil Code cited by the appellant, it is clear that a builder or a possessor in
bad faith is not entitled to indemnity for any useful improvement on the premises. (Santos vs. Mojica, L-
25450, Jan. 31, 1969). In fact, he is not entitled to any right regarding the useful expenses (II Paras
[1971] 387). He shall not have any right whatsoever. Consequently, the owner shall be entitled to all of
the useful improvements without any obligation on his part (Jurado, Civil Law Reviewer [1974] 223).”
Petitioner’s Stand:
The decision in the case of Mindanao Academy, Inc. vs. Yap (13 SCRA 190) cited by petitioner does not
support its stand. On the contrary, this Court ruled in said case that “if the defendant constructed a new
building, as he alleges, he cannot recover its value because the construction was done after the filing of
the action for annulment, thus rendering him a builder in bad faith who is denied by law any right of
reimbursement.” What this Court allowed appellant Yap to remove were the equipment, books, furniture

and fixtures brought in by him, because they were outside of the scope of the judgment and may be
retained by him.
Neither may the decision in the case of Carbonell vs Court of Appeals (69 SCRA 99), also cited by
petitioner, be invoked to modify the clear provisions of the Civil Code of the Philippines that a possessor
in bad faith is not entitled to reimbursement of useful expenses or to removal of useful improvements.
Issue: Does a possessor in bad faith have the right to remove useful improvements?
Held: The answer is clearly in the negative. Recognized authorities on the subject are agreed on this
point.**
Article 449 of the Civil Code of the Philippines provides that ”he who builds, plants or sows in bad faith
on the land of another, loses what is built, planted or sown without right to indemnity.” As a builder in
bad faith, NAWASA lost whatever useful improvements it had made without right to indemnity (Santos
vs. Mojica, Jan. 31, 1969, 26 SCRA 703).
Moreover, under Article 546 of said code, only a possessor in good faith shall be refunded for useful
expenses with the right of retention until reimbursed; and under Article 547 thereof, only a possessor in
good faith may remove useful improvements if this can be done without damage to the principal thing
and if the person who recovers the possession does not exercise the option of reimbursing the useful
expenses. The right given a possessor in bad faith is to remove improvements applies only to
improvements for pure luxury or mere pleasure, provided the thing suffers no injury thereby and the
lawful possessor does not prefer to retain them by paying the value they have at the time he enters into
possession
CRISPULO SIDECO vs. FRANCISCO PASCUA 13 Phil. 342
The title to personal property prescribes upon uninterrupted possession thereof, in good faith, for a period
of three years. (Art. 1955, Civil Code.) Good faith is always presumed, and the burden of proof is upon
the party alleging the bad faith of the possessor. (Art. 434, Civil Code.) The running of the period by
virtue of which title to personal property by prescription may be acquired, is coincident with the period
during which the property has been in the possession of the person claiming ownership thereof by
prescription. (Art. 1955, Civil Code.)
While the unexplained possession of stolen personal property a short time after the commission of the
theft raises a presumption of guilt, such possession would be insufficient to sustain a finding of guilty
unless and until the possessor had first been given an opportunity to justify the possession and to prove,
if he could, that he was guiltless of any crime in acquiring the property.
Facts:
This is an action to recover possession of a caraballa and two calves. Sometime in the year 1900 a
caraballa above 5 years old disappeared from plaintiff's hacienda. The animal was branded with the letters
"S. P.," that being the brand used by the plaintiff on his stock for some thirty years past and duly
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MIDTERMS CASE DIGEST IN PROPERTY- TIAMZON 11
registered by him as such in the municipality of San Isidro on the 4th day of May, 1904. In the month of
July, 1907, a caraballa branded with the letters "S. P.," and in addition thereto, the number 23, was found
in the possession of the defendant, together with two of her calves some 2 or 3 years old. Plaintiff claims
that this caraballa is the animal which disappeared from his hacienda in the year 1900; and in the month
of August, 1907, he instituted these proceedings, wherein he prays for possession of the caraballa,
together with her calves.
The evidence of the identity of the caraballa lost by the plaintiff with the caraballa found in the possession
of the defendant is not wholly satisfactory, but it is not necessary for us to go into that question, because
we are of opinion that the evidence of record conclusively establishes defendant's title to the animal by
prescription, under the provisions of article 1955 of the Civil Code, which provide that the title to personal
property prescribes by uninterrupted possession for three years in good faith (con buena fe).
Defendant proved by unimpeached documentary and oral evidence that he purchased the animal in
question for the sum of P110 from one Guillermo Zamora on March 9, 1903; that Zamora purchased the
animal for the sum of P110 from one Salvador Pangangban on February 27, 1903; and that Pangangban
was the duly registered owner of the animal on March 30, 1901. Each of these transfers of ownership
and the title of the various owners is evidenced by the necessary certificates of property and transfer—
all apparently executed in accordance with the provisions of law in such cases.
It will be seen that more than the three years' prescriptive period had elapsed from the date when
defendant purchased the animal, on March 9, 1903, until the date when plaintiff discovered her in the
possession of defendant, and instituted these proceedings looking to her recovery.
The trial court was of opinion that proof of this uninterrupted possession by the defendant was not
sufficient to establish his title by prescription, under the provisions of the above-cited article 1955 of the
Civil Code, because. in the opinion of the trial court, he failed to establish affirmatively that he had
acquired, and held possession of the animal in good faith (con buena fe), as required by the provisions
of that article. Under the provisions of article 434 of the Civil Code, however, "good faith (la buena fe) is
always presumed, and the burden of proof is upon the party alleging the bad faith of the possessor," and
plaintiff offered no evidence whatever which tends to impeach the bona fides of defendant's alleged
purchase of the animal or of his uninterrupted possession thereof from the date of the purchase until the
date when this action was instituted; and we may add that in the total absence of proof to the contrary,
defendant's documentary and oral evidence affirmatively established the bona fides of his purchase and
possession.
The trial court appears also to have been of opinion that, in any event, the period for prescription provided
in article 1955 did not begin to run as to the caraballa in question until the month of July, 1907, when
plaintiff discovered for the first time the whereabouts of the animal which he claims to have lost in 1900.
It is quite clear, however, from the provisions of article 1955, that the running of the period by virtue of
which title of prescription may be acquired is coincident with the period during which the thing has been
in possession of him who claims ownership thereof by prescription, without regard to the time when a
former owner may have lost possession or discovered the whereabouts of the thing lost; and in this
connection, it is worthy of observation, that the provisions of article 1962, touching the prescription of

actions for the recovery of possession of personal property, declare in express terms that the prescriptive
period for such actions begins to run from the moment when the owner loses possession.
The evidence of record, which discloses that plaintiff's animal was lost in 1910, and that defendant and
his predecessors in interest had been in uninterrupted possession of the animal in question more than
six years prior to the date when this action was instituted, Would appear to be sufficient to sustain a
finding that defendant had acquired title thereto by prescription, under the provisions of article 1955 of
the Civil Code, which declare that title by prescription may be acquired in personal property, by virtue of
the uninterrupted possession for six years, without the necessity of any other condition; and to sustain a
further finding that plaintiff's action to recover possession had prescribed, before the institution of this
action, by virtue of the provisions of article 1962 of the Civil Code, as well as by the provisions of
subsection 3 of section 43 of the Code of Civil Procedure. But defendant being entitled to judgment in his
favor under the provisions of article 1955 hereinbefore discussed and on which he relied, there is no need
for a specific ruling on these possible defenses.
Ortiz vs. Fuentebella., 27 Phil. 537, No. 8108 August 22, 1914
Topic: Ejectment
Declaration of nullity of a title does not imply that it was acquired in bad faith. Possession acquired after
having knowledge of certain facts that put in doubt the title of the assignees must be regarded as in bad
faith.
"Possession acquired in good faith does not lose this character, except in the case and from the moment
that the possessor is aware that he possesses the thing illegally."
Facts:
The person securing this possessory information (parcel of pasture land) was Don Ramon Ortiz, a resident
of the said town of San Jose, who, according to the contents of the information, "proved before the
justice of the peace of that town the possession he had held of said land for fifteen years previously,
when he had acquired it by cultivating it himself, without securing any written title;" and it was approved
by order of July 2, 1892.
On March 10, 1909, Marcelina Ortiz, daughter of the said Don Ramon Ortiz, addressed to Asuncion
Fuentebella: "I have been informed that you are thinking of setting out coco palms on the lands that our
parents possess in the place called Tagas, of this municipality, used as a pasture for our cattle, within
the boundaries formed on the north by the rivulet Rangas Sadang, on the east by the beach, on the south
by the San Miguel River that flows into the Sabang Bunga, and on the west by the lands of Gaspar Codillo
and others. If this be true, I request that you desist from your purpose."
Asuncion Fuentebella answered "Regarding my idea of setting out coco palms, you are misinformed; I
am not thinking of setting out coco palms, as you state, on lands belonging to your parents."
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In view of this attitude of Asuncion Fuentebella, Ramon Ortiz filed the present complaint, wherein he asks
for restitution of the possession of said parcel of land and P200 as damages.
Asuncion Fuentebella cited Juan and Sotera Cano in defense of the title. She answered the complaint on
August 21, 1911, and said that she had been in possession of the said land for more than two years and
that she had set out thereon over 5,000 coco palms and built a house, wherefore she prayed that either
the complaint be dismissed, or that the plaintiff pay her P8,000 Philippine currency for the coco palms
set out and the house built. The vendors, Cano and his sister, substantiated their possession from the
time of inheriting the property from their parents to the time of the sale; and subsidiarily, should this
defense fail. they alleged prescription in favor of the defendant Fuentebella.
After examining both the oral and documentary evidence the Court of First Instance of Ambos Camarines
absolved the def endant f rom the complaint with the costs against the plaintiff, who appealed from the
judgment.
Asuncion Fuentebella cannot make her personal possession prevail over the possession inscribed in the
property registry in favor of Ramon Ortiz, it having lasted only two years before she filed her answer to
the complaint. Primarily and personally the defendant has no right beyond what she has derived from
Juan and Sotera Cano.
With reference to Juan and Sotera Cano's possession, the trial court's conclusions are: That these Cano
defendants have not really and materially possessed a great part of the land; that Felipe Cano, the father
of these defendants, had a house built on the tract, and probably exercised acts of possession over the
land in the immediate neighborhood of the house and its vicinity by setting out fruit trees on a part
thereof and now claims to have exercised such acts of possession over the whole of the land in question,
which was only planted in breadfruits and coco palms around his house (B. of E. 15) ; that said land was
not utilized during this time, except for what said heirs of Felipe Cano had there, consisting in some
plantations of coco palms. (Ibid., 13.)
That Felipe Cano was in possession of part of the land during his lifetime and that after his
death this possession passed to his children, two of whom are Juan and Sotera Cano.
That Juan and Sotera Cano in the year 1908 sold this land to the defendant Asuncion Fuentebella, who
then took possession thereof and has held it to date. At the time of this transfer to the defendant
Fuentebella, Juan Cano and Sotera Cano were in possession of the land as heirs of their father Felipe
Cano; but the heirs of Felipe Cano have not joined with those herein cited to defend the title, Juan Cano
and Sotera Cano, in this sale nor have they appeared as parties and this court holds that their rights were
not transferred by their brother and sister Juan and Sotera Cano to the defendant Asuncion Fuentebella."
(B. of E., 16.)
From this it appears that neither Felipe Cano in his lifetime nor his children after his death possessed in
the place called Tagas more space than was occupied by their house and their small plantations of
breadfruit and coco palms around it, that is to say, merely a portion of the tract of 27 hectares in question,
not all of it; and that, consequently, they could not sell to Fuentebella more than the space occupied by

the house and some small plantations of breadfruit and coco palms, and of this small part only their
hereditary portions, not those which on that hypothesis should pertain to their coheirs.
Reviewing the evidence, we find the following facts:
Sotera Cano and Juan Cano stated that they had other brothers living, Bernabe and Potenciano Cano,
and also some nephews, the children of other brothers now deceased; and, according to Juan Cano, the
vendee Fuentebella was acquainted with this f act.
Juan Peña, witness for the defendant, a man of 68 years of age and brother-in-law of Felipe Cano, stated
that the latter had had his house in Tagas "a little outside the land in question, although his plantation
of breadfruit trees was within the land in question" (p. 36) ; that he had had nothing but a house and
that it had been destroyed; that Felipe Cano had been dead for over thirty years, for the witness was
then only a boy, "a child still," according to his own words; that after Felipe Cano had died and the house
had been destroyed, his widow did not rebuild it, but that his heirs "went to live on the other side of the
Mitil Creek, whither they changed their residence" (pp. 41 and 42) ; and the person who went to live in
the place they left was Cipriano Compuesto, who built his house there; that Don Ramon Ortiz had
carabaos and cattle there from the time of the Spanish Government; and that on the land in question
there are coco palms that were planted by Cipriano Compuesto beside his house.
Consequently, in 1892, the date of the possessory information, they were not the possessors of the land
in question but only perhaps possessors of a tract of land conterminous with it on the west. But they
could not have continued even to be the possessors in 1892 of this adjoining land on the west, because,
according to the testimony of their own witness, Juan Peña, when their father Felipe Cano died, they
changed their residence to the other side of the Mitil Creek, and their father's death, according to the
same witness, occurred when even he was young; hence it is not hazardous to conclude that in 1870 he
was no longer alive, and that in 1882 either Maria Pagueo or surely Cipriano Compuesto was on the
adjoining land. At all events it has been very convincingly proved that neither in 1892 nor in 1882 nor in
1870 nor at any time did Felipe Cano and his children possess the land that is the subject matter of the
present litigation, and that at the death of Felipe Cano and after the house located a little outside of the
disputed land had been destroyed his heirs did not continue to live there but moved their residence to
the other side of the Mitil Creek.
Sotera Cano testifies that outside this disputed land, toward the west at some 600 or 800 brazas f rom
its boundary, they had a coco-palm grove and there they had their house, beside which they also had
the plantations which they had inherited from their father Felipe Cano, this being the only house they
had in that place, and in which they were living at the time of their father's death; that she was acquainted
with the three persons, among them Maria Pagueo, whose lands were conterminous on the west with
the disputed land, all three of which persons had their plantations. "These plantations," she adds, "are
between our plantations" (p. 57). And Juan Cano says that when their father died they built the house
located in the coco-palm grove; that coming f rom these coco palms where they were living to the visita
(or barrio there is on the land) one had to cross a creek called Mitil and that "according to his belief the
disputed land is the coco-palm grove where their house is located beside the plantations toward the west
of the visita ' (p. 68).
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This belief or, as now shown, error of Juan Cano is the cause of all the other errors that have given rise
to this suit.
To offset the possession attested by the registered possessory information it has not been proven in any
way that either at the date of its inscription in 1892 or in 1882 or in 1879 could Felipe Cano or his children
Juan and Sotera Cano have been in possession of the disputed land; and if the complaint was dismissed
it was solely on the basis of the incorrect hypothesis that "at the time when the plaintiff obtained this
title of possessory information, Felipe Cano, father of the persons herein cited to defend the title, Juan
and Sotera Cano, or they themselves if he was dead, were in possession of said land or a part thereof."
(B. of E., 15.) It has been clearly demonstrated that in 1879 Felipe Cano was already dead and that at
his death and after the destruction of his house built on the border of the disputed land his children
changed their residence and went to live on the other side of the Mitil creek, some 600 or 700 brazas f
rom those borders, with plantations between, or with plantations between of the three persons named
in the possessory information as adjoining on the west, among these Maria Pagueo.
The authenticity and efficacy of the possessory information having been proven by means of its inscription
in the registry, and not impugned, restitution must be ordered of the possession claimed by the plaintiff,
and also of the land in question, with the costs against the defendants. Consequently, the judgment
appealed from, in so far as it dismisses the complaint, must be reversed.
With reference to the counterclaim set up by the defendant Asuncion Fuentebella, only the following facts
have been proved:
That the defendant has been in possession of the land claimed in the complaint for only about two years
from the date of the answer thereto, since August 21, 1911, that is, since some time before August 21,
1909;
That from the document she has presented in evidence she does not appear to have purchased the land
claimed in the complaint until December 29,1909, after she had already been warned by the plaintiffs
daughter in March of that year not to set out coco palms on said land as it belonged to the latter's father;
That, if what the defendant and her witness Sotera Cano state is true, the sale was closed in 1908, but
the document had not been drawn up until the price agreed upon had been paid;
That, according to the testimony of Juan Cano, the defendant purchased the land from Juan Cano and
Sotera Cano, knowing perfectly that there were other coheirs, that is, their two brothers and various
nephews whose number was not definitely stated;
That Juan Peña, witness for the defendant, states that Ramon Ortiz has had cattle and carabaos since
the time of the Spanish Government, while it has been seen that, according to this same witness, Felipe
Cano had land in Tagas, not the land in question, but a little outside that land; and his children, not the
same land their father had occupied, for this was later Cipriano Compuesto's, but some coco-palm groves
distant 600 or 800 brazas to the west of the disputed land, whither they had moved their residence, it
thus very clearly appearing in this suit that all this litigation has been maintained on a f alse basis, which
is the belief of the defendant Juan Cano that the land now in question is exactly this coco-palm grove

where his house is located beside the plantations to the west of the visita, or of the settlement formed
on the land of Ramon Ortiz.
These facts being admitted, the defendants called to support the title have been unable to justify the sale
they made of the land in question to Asuncion Fuentebella.
Did Asuncion Fuentebella possess the land in good faith? That is the point to be determined
in the counterclaim.
It has not been proved that the defendant Asuncion Fuentebella has acted in pursuance of some evil plan
in conjunction with her witness Irineo Peñas, who along with his father had from childhood been and
after the latter's death continued to be the herdsman of the plaintiff's cattle on the land in question and
was dismissed by the latter on account of his disloyalty and bad conduct. Now it appears that he is the
principal laborer of the defendant in setting out coco palms.
However it be, we do not regard as decisive the evidence presented to prove that the defendant's
possession was in bad faith. The nullity of the greater part of her title is not sufficient argument to prove
that she knew of the defect in her mode of acquisition of a tract of land as belonging to Juan and Sotera
Cano, when it is now demonstrated in this case that neither Sotera, nor Juan Cano, nor even their father
Felipe Cano, had at any time possessed it, but another tract in the neighborhood, possession whereof
might easily have caused error on the part of the purchaser. Defendant's bad faith began after the
warning given in a letter by the plaintiff's daughter in March, 1909, for after having received it she then
had ground to doubt that Sotera and Juan Cano could transfer any title of possession in the following
December.
The trial court has declared that it encountered a good deal of difficulty in deciding whether the coco
palms had been set out before or after the receipt of the said letter, but it believes that, in view of the
evidence, a large portion of the land, but not the whole, was already so planted; that the house was
under construction but unfinished; and that "there is no other evidence in the case regarding the value
of said house or the value of the coco palms, except what has been stated by the defendant." (B. of E.,
14.) Everything done on the land, expenditures, outlay, improvements, from the moment when the letter
was received bears the stamp of having been carried out when the possessor was not unaware that she
was improperly in possession of the land. In the light of this holding must be determined all the questions
that arise concerning the effects of the defendant's possession and the rights she is entitled to under the
provisions of the Civil Code with respect to the house and the coco palms that have led to her
counterclaim, once it has been ordered in this decision that possession of the land be restored to the
plaintiff.
The judgment is reversed in so far as it absolves the defendants from the complaint, with the costs
against the plaintiff.
Tacas vs. Tobon, 53 Phil. 356, No. 30240 August 23, 1929
LANDS; POSSESSION IN GOOD FAITH; TITLE OR MODE OF ACQUISITION.—According to article 433 of
the Civil Code, one who is not aware of a flaw in his title or mode of acquiring the ownership, is deemed
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MIDTERMS CASE DIGEST IN PROPERTY- TIAMZON 14
a possessor in good faith. And according to article 451 of the same Code, the possessor in good faith
acquires the fruits while his possession is not legally interrupted.
INTERRUPTION OF POSSESSION ; RETURN OF FRUITS.—But every possessor in good faith becomes a
possessor in bad faith from the moment he becomes aware that what he believed to be true is not so.
His possession is legally interrupted when he is summoned to the trial, according to article 1945 of the
Civil Code, and from that time he is obliged to return the fruits received, for he ceases to be considered
a possessor in good faith.
FACTS:
On February 1, 1918 Tacas, et. al. filed an action to recover from defendant Tobon the
ownership and possession of three parcels of land, together with the fruits collected by him during the
time he was in possession of said land since January 1912. He alleged that Tobon unlawfully took said
parcels upon the death of Francisco Dumadag, predecessor in interest of the plaintiffs; and that he
remained in possession, enjoying the fruits to the value of P700 annually.
In his answer docketed on April 11, 1918, Tobon alleged that he is the owner of said lands,
having purchased them from Exequiel or Gil Tacas.
The trial court declared the plaintiffs to be the absolute owners of the three parcels of land in
litigation, and ordered Tobon to deliver said parcels of land to them, together with the fruits collected
each year since 1912 until the complete termination of the case, and in default thereof, to pay them
P11,040, which is the total value of the rice and tobacco from 1912 to 1927. Tobon appealed.
ISSUE:
WON the trial court erred in ordering Tobon to deliver to the plaintiffs the fruits of the land from
1912 to 1927?
RULING:
Yes, the trial court erred insofar that it ordered Tobon to deliver to the plaintiffs the fruits of the
land from 1912 to 1927.
Evidence being lacking to show that when he entered upon the possession of the
lands in question, he was aware of any flaw in his title or mode of acquiring it, he is deemed
a possessor in good faith (Art. 433, Civil Code), and in accordance with Art. 451 of the Civil Code, the
fruits of said lands were his, until he was summoned upon the complaint, or until he has filed his answer
thereto.
Manresa commented that to every possessor in good faith, there comes a time when he is
considered a possessor in bad faith. When the owner or possessor with a better right comes along, where
he becomes aware that what he had taken for granted is at least doubtful, and when he learns the

grounds in support of the adverse contention, good faith ceases. The possessor becomes aware that
his possession is unlawful from the time he learns of the complaint, from the time he is
summoned to the trial. It is at this time that his possession is interrupted, according to Art. 1945, and
that he ceases to receive the fruits, according to the first paragraph of Art. 451.
Thus, Tobas is only bound to return to the plaintiffs the fruits received from April 1918 to
1927 with the right to deduct the expenses of planting and harvesting (Art. 365 of the Civil Code), which
shall be determined by the trial court, after hearing both parties.
Miraflor vs. Court of Appeals, 142 SCRA 18, Nos. L-40151-52 April 8, 1986
Civil Law; Property; Ownership; Proof of exercise of acts of dominion over property.—Severo Monsalud
has indeed exercised acts of dominion over the land since 1938 considering that he has lived on the land,
built a house, declared the land in his own name for tax purposes and religiously paid the taxes thereon.
(See Dacasin v. Court of Appeals, 80 SCRA 89).
Prescription; Mere entry into premises by virtue of oral lease agreement and payment P50.00 only for
the first month, not possession or ownership in the concept of owner; Acquisition of land by acquisitive
prescription.—The records do not show an iota of evidence to prove that Gregorio Miraflor asserted
ownership or even possession over the land in question. His entry into the premises was by an oral lease
agreement whereby he agreed to pay P50.00 a month for the use of one-half of the house’s groundfloor.
But the fact that he paid P50.00 for the first month belies the presumption that he entered the premises
in the concept of an owner. From the foregoing, it is clear that Severo Monsalud acquired all the rights
over the land through acquisitive prescription. Gregorio Miraflor can no longer come forward and assert
ownership over it.
Prescription; Laches.—As stated in Cruz v. Court of Appeals earlier cited: “Whatever right private
respondents had to the property had already prescribed by the mere lapse of time by reason of
negligence, carelessness and abandonment and their cause of action is barred or can no longer prosper
after more than twenty-six (26) years, that is from 1938 when the cause of action accrued, to 1964 when
the complaint was filed. The laws aid the vigilant, not those who slumber on their rights. Vigilantibus sed
non dormientibus jura subveniunt.”
Accion Publiciana; Refusal of a party to deliver possession of property due to the adverse claim of
ownership of the same property, the action is clearly for recovery of right to possession and be declared
as owner.—We rule that this case is an accion publiciana. As held in the case of Reyes v. Sta. Maria, (91
SCRA 164): “The lower court was clearly in error in issuing its dismissal order on its mistaken notion ‘that
the allegations of facts are only constitutive of an action for unlawful detainer’ since the complaint shows
on its face that respondents’ refusal to deliver the possession of the property was due to their adverse
claim of ownership of the same property and their counter allegation that they had bought the same from
a certain Pablo Aguinaldo and therefore, petitioners’ action was clearly one for recovery of their right to
possess the property (possesion de jure) as well as to be declared the owners thereof as against the
contrary claim of respondents.”
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Facts:
This petition for review involves two cases tried jointly inthe then Court of First Instance, Branch II of
Zambales, towit: (1) Civil Case No. 1382, an action for partition and annul-ment of a deed of
reconveyance; and (2) Civil Case No. 219-I, anaction for recovery of possession and collection of unpaid
rentals.
Plaintiff Rosa Miraflor who claims an undivided one-half of the property as her lawful inheritance from
her father, Gavino. It is Rosa’s contention that as far as she is concerned, the escritura de compra
definitiva is null and void because she was never a party to its execution. In so far as Gregorio Miraflor
is concerned, he claims that the instrument is likewise null and void because he was a minor at the time
of its execution while his sister was an “ignoramus” and both were persuaded to sign the instrument
without any consideration at all.
Defendant Severo Monsalud contends that the property, subject matter of the sale, was the exclusive
property of Catalino Miraflor to whom it was adjudicated upon the death of his parents Joaquin Miraflor
and Petronila Misa. Monsalud claims that the deed was valid because Gregorio and Elena Miraflor received
the consideration of P1,000.00. Monsalud states that ever since the conveyance of the property on
October 17, 1938, he has been in continuous and physical possession of the land and whatever right
Rosa Miraflor and Gregorio Miraflor have over the land have already prescribed.
The trial court, presided by Judge Sulpicio V. Cea, rendered its decision on September 17, 1953 declaring
the plaintiff Rosa Miraflor as the owner of one-half of the land in question and the defendants Gregorio
Miraflor and Eulogia Merza as the owner of the other half of the land.
After his amended motion for new trial was denied, defendant Severo Monsalud appealed to the Court of
Appeals which affirmed the decision of the trial court. Not satisfied, Severo
Monsalud elevated the case to the Supreme Court.
Before the trial court could conduct further proceedings on Civil Case No. 1382, Severo Monsalud
commenced an action in April 1966 in the Court of First Instance of Zambales against spouses Gregorio
Miraflor and Guillerma Misa de Miraflor, seeking the recovery of the possession of a portion of the ground
floor of a building of strong materials constructed on the land in question in Civil Case No. 1382 and the
recovery of P13,270.00 as unpaid rentals and attorney’s fees. This case was docketed as Civil Case No.
219-I.
In the answer filed on May 23, 1966, Gregorio Miraflor raised as affirmative defenses that he is the owner
of the land where the house was situated; that the possession of the defendants since 1948 up to the
present was with the knowledge and consent of one Josefa Mena, sister-in-law of plaintiff Severo
Monsalud by his first marriage to Dolores Mena and that the defendants are not bound to pay any rentals;
that the plaintiff has not averred any claim for rentals against Gregorio Miraflor in Civil Case No. 1382
and that whatever action the plaintiffs might have against the defendants has prescribed. As
counterclaim, defendants asked for rentals for the lot on which the building was constructed and
attorney’s fees.

Rosa Miraflor, Gregorio Miraflor, Guillerma Misa de Miraflor and Severo Monsalud appealed the decision
to the Court of Appeals. The appeal interposed by Rosa Miraflor was dismissed in a resolution dated
December 1, 1971. During the pendency of the appeal, appellant Severo Monsalud died. In a resolution
dated February 6, 1973, the Court of Appeals allowed the substitution of the deceased Severo Monsalud
by his widow and five children.
Gregorio Miraflor then filed this petition for review raising the following issues:
Held:
Anent the first issue, the petitioner contends that the issues of prescription of action and fraud were
already decided by the Court of Appeals in 1955 and were not among the issues remanded by the
Supreme Court in 1960 for further proceedings. He states that it would be contrary to the sound judicial
and public policy of ending litigations and avoiding multiplicity of suits if these issues are reopened.
The petitioner’s contention is untenable. It was not error for the respondent court to have looked into
these issues again. Nor can we consider the decision of the Court of Appeals in 1955 as final and binding.
In fact, when the Supreme Court in 1960 allowed the submission of further evidence by Severo Monsalud
it thereby laid these issues subject to being reopened and reviewed. Neither can we conclude that the
Supreme Court meant to remand the case for further proceedings on specific issues alone as contended
by the petitioner for it would be unfair and unjust to disregard matters necessary to arrive at a sound
and fair disposition of the case.
In fact, the specific issues ordered by the Supreme Court to be examined on remand, by their very nature
were susceptible of leading to findings and conclusions different from those arrived at earlier. Precisely,
this Court in 1960 ordered the trial court to conduct further proceedings on the issue of prescription
raised by Monsalud in his answer to Rosa Miraflor’s complaint, an issue which, according to the petitioner,
may no longer be reopened.
In Hernandez v. Andal (78 Phil. 196), and Baquiran v. Court of Appeals (2 SCRA 873), this Court had
occasion to pass upon the broad discretionary power of the Court of Appeals to look into related matters
of record having some bearing on specific issues raised before it, stressing the paramount aim of
promoting the ends of justice. The appellate court did not exceed its powers as alleged by the petitioner.
In the instant case, the Court of Appeals correctly ruled that the petitioner has lost whatever rights he
had over the land by prescription.
We apply the ruling in the case of Cruz v. Court of Appeals (93 SCRA 619) which states:
xxx xxx xxx
“x x x [S]ince petitioners’ possession of the property in question commenced way back in 1938 which
was at the time the old Civil Code was still in force, the prescriptive period is governed under Section 41
of the Code of Civil Procedure because Article 1116 of the New Civil Code provides that ‘Prescription
already running before the effectivity of this Code (August 30, 1950) shall be governed by laws previously
in force.’ Section 41 of the C.C.P. states:
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MIDTERMS CASE DIGEST IN PROPERTY- TIAMZON 16
“ ‘Sec. 41. Title to land by prescription.—Ten years of actual adverse possession by any person claiming
to be the owner for that time of any land or interest in land, uninterruptedly, continuously for ten years
by occupancy, descent, grants of otherwise, in whatever way such occupancy may have commenced or
continued, shall vest in every actual possessor of such land a full complete title, saving to the person
under disabilities the rights, secured by the next section.’ ”
In the same case, the Court discussed lengthily the ten-year prescriptive period which we quote:
“Jurisprudence, however, is overwhelming and well-established in support of petitioners’ claim of title
acquired through acquisitive prescription. In Ongsiaco v. Dallo, 27 SCRA 161, the Supreme Court said:
‘Under the Code of Civil Procedure formerly in force, good or bad faith was immaterial for purposes of
acquisitive prescription. Adverse possession in either character ripened into ownership after the lapse of
ten years. In the same manner, an action to recover title to or possession of immovable property
prescribed in the same period.’
“In other words, the good faith and just title of Juan Andan in the case at bar, is immaterial for
prescription lies under Section 41, C.C.P.”
Severo Monsalud has indeed exercised acts of dominion over the land since 1938 considering that he has
lived on the land, built a house, declared the land in his own name for tax purposes and religiously paid
the taxes thereon. (See Dacasin v. Court of Appeals, 80 SCRA 89). Gregorio Miraflor, on the other hand,
argues that he entered the premises on May 1, 1948, about nine years and seven months after the
execution of the Escritura de Compra Venta Definitiva on October 17, 1938, thus interrupting the ten-
year prescriptive period as provided in sec. 41 of the Code of Civil Procedure.
With respect to the petitioner’s allegation that the finding of fraud in the execution of the deed of sale
was final and conclusive, such contention is devoid of merit. Though the trial court and the Court of
Appeals found that there was fraud in the execution of the deed of sale, fraud or deceit does not
necessarily render a contract void ab initio and, therefore, imprescriptible (Tongoy v. Court of Appeals,
123 SCRA 99). It can only be a ground for rendering the contract voidable or annullable and hence, the
action to annul the deed is subject to prescription (Pangadil v. Court of First Instance, 116 SCRA 347;
Tumalad v. Vicencio, 41 SCRA 143). This right of action has likewise been lost in favor of Severo Monsalud
who has rightfully acquired the land through prescription. As stated in Conspecto v. Fruto, (31 Phil. 144):
“Section 40 of Act 190 is plain and unambiguous. It plainly says: ‘An action for the recovery of title to or
possession of, real property, or an interest therein, can only be brought within ten years after the cause
of such action accrues.’ In the present case, the action for the recovery of the possession of the real
property in question was not brought within ten years after the cause of action had accrued.”
xxx xxx xxx
“It is the essence of the statute of limitations that, whether the party had a right to the possession or
not, if he entered under the claim of such right and remained in possession for the period (ten years)
named in the statute of limitations, the right of action of the plaintiff who had the better title is barred
by that adverse possession. The right given by the statute of limitations does not depend upon and has

no necessary connection with, the validity of the claim under which the possession is held. Otherwise
there could be no use for the statute of limitations or adverse possession as a defense to an action, for
if the decision is made to depend upon the validity of the respective titles set up by the plaintiff and the
defendant, there can be no place for the consideration of the question of adverse possession. It is because
the plaintiff has a better title that the defendant is permitted to rely upon such uninterrupted possession,
adverse to the plaintiff’s title, as the statute prescribes, it being well understood and an element in such
cases, that the plaintiff does have the better title, but that he has lost it by delay in asserting it. (Probst
v. Presbyterian Church, 129 U.S. 182).
“Neither is it necessary that the defendant should have a proper title, under which he claims possession.
It is sufficient, if he asserts ownership of the land, and that this assertion is accompanied by an
uninterrupted possession for the period named in the statute. It is this which constitutes adverse
possession-claiming himself to be the owner of the land. If the one in possession asserts his right to own
the land in dispute, asserts his right to the possession, and his possession has been adverse and
uninterrupted, it constitutes a bar which the statute intended to give him.
Gabrito vs. Court of Appeals, 167 SCRA 771, No. L-77976 November 24, 1988
Concept of possessor or builder in good or bad faith presupposes ownership in another.
Ejectment; Possession; Admission by petitioners unquestionably recognized private respondents' prior
right of possession over the questioned property
In a preliminary conference held pursuant to Section 6 of the Rule on Summary Procedure, defendants
admitted that they entered the premises as lessees and had been paying rentals for the use of the land
to Gloria Carillo, private respondents' predecessor-in-interest (Order dated May 15, 1985 in Civil Case No.
2511, MTC, Olongapo City, Branch V; Rollo, pp. 72-73). When requested to vacate the premises,
petitioners asked for an extension of time which request was granted. However, petitioners failed to
vacate the premises and also stopped paying rentals. In view of said admissions, petitioners had
unquestionably recognized private respondents' prior right of possession over the questioned property.
Builders in good faith; Petitioners not considered builders in good faith
Petitioners' allegation in their answer that they are builders in good faith over the land as provided for in
Article 448 of the Civil Code is untenable. As ruled by this Court, Article 448 of the Civil Code, applies only
where one builds on land in the belief that he is the owner of the land, but does not apply where one's
interest in the land is that of a lessee under a rental contract.
Rule is well-settled that lessees are not possessors in good faith
"The rule is well-settled that lessees, like petitioner, are not possessors in good faith, because he knew
that their occupancy of the premises continues only during the life of the lease, and they cannot as a
matter of right, recover the value of their improvements from the lessor, much less retain the premises
until they are reimbursed. Their rights are governed by Article 1678 of the Civil Code which allows
reimbursement of lessees up to one-half of the value of their improvements if the lessor so elects."
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More than that, it has been settled that the mere fact that, in his answer, defendant claims to be the
exclusive owner of the property from which plaintiff seeks to eject him is not sufficient to divest the
Municipal Trial Court of jurisdiction.
And even more recently in the case of Guerrero v. Amores, et al., G.R. No. L-34492 promulgated on
March 28,1988, the Court clearly stated that "pending final adjudication of ownership by the Bureau of
Lands, the Court has jurisdiction to determine in the meantime the right of possession over the land."
Corollary thereto, the power to order the sheriff to remove improvements and turn over the possession
of the land to the party adjudged entitled thereto, belongs only to the courts of justice and not to the
Bureau of Lands.
On the other hand, the application of the principle of exhaustion of administrative remedies as a condition
precedent to the filing of a juridical action is confined to controversies arising out of the disposition of
public lands (Geukoko vs. Araneta, 102 Phil. 706 (1957); Marukot vs. Jacinto, 98 Phil. 128 (1957),
alienation of public lands (Rallos vs. Ruiz, Jr., supra) or to the determination of the respective rights of
rival claimants to public lands (Pitarque vs. Sorilla, supra) and not to possessory actions involving public
lands which are limited to the determination of who has the actual, physical possession or occupation of
the land in question.
Facts:
The appeal originated as an unlawful detainer complaint filed by herein private respondents with the
Municipal Trial Court, Branch V, Olongapo City.
"The spouses Roberto Tan and Benita Ching-Tan filed a complaint in the Municipal Trial Court against
defendants Maximo Gabrito, et al., alleging that they are the possessors and legal owners of the property
situated at No. 107 Gordon Ave., New Kalalake, Olongapo City as evidenced by Tax Declaration No. 4-
2046. The defendants are leasing portions of this parcel of land, each paying the corresponding monthly
rentals due thereon.
"On the leased portion, the defendants constructed buildings and have allowed other persons to sublease
the same for commercial purposes.
"As the spouses Tan have no other property where they could construct their residential house, the
spouses Tan notified the defendants (in January 1984) that they intend to personally use the land to
build their house thereon and gave defendants three (3) months to vacate the premises and remove the
structures and improvements which defendants had constructed thereon.
Defendants requested for an extension of time within which to vacate, which was granted by the spouses
Tan. However, from that time on, defendants also stopped paying monthly rentals due on the land they
leased.
Defendants were told to leave the premises and to pay rentals in arrears. As defendants refused to comply
with both demands, the matter was brought to the Barangay Council for settlement. As no agreement

was reached, a certification to file action was issued to the spouses Tan. Hence, the Tans filed an action
for unlawful detainer with damages against Gabrito, et al.
On appeal to the Regional Trial Court (Civil Case No. 450-0-85), the decision of the Municipal Trial Court
was affirmed in its decision. On review, herein respondent Court of Appeals sustained the decision
rendered by the Regional Trial Court Branch LXXIV.
Issue: Whether or not an action for unlawful detainer is the proper action to oust petitioners from their
occupation of the land in dispute.
Held: There is no question as to the ownership of the land in litigation as both petitioners and private
respondents admit that the same is a public land and owned by the government. The bone of contention
is, who has a better right to possess the land which definitely falls under the jurisdiction of the Municipal
Trial Court and the rule of summary procedure may properly be applied.
In a preliminary conference held pursuant to Section 6 of the Rule on Summary Procedure, defendants
admitted that they entered the premises as lessees and had been paying rentals for the use of the land
to Gloria Carillo, private respondents' predecessor-in-interest (Order dated May 15, 1985 in Civil Case No.
2511, MTC, Olongapo City, Branch V; Rollo, pp. 72-73). When requested to vacate the premises,
petitioners asked for an extension of time which request was granted. However, petitioners failed to
vacate the premises and also stopped paying rentals. In view of said admissions, petitioners had
unquestionably recognized private respondents' prior right of possession over the questioned property.
Petitioners' allegation in their answer that they are builders in good faith over the land as provided for in
Article 448 of the Civil Code is untenable. As ruled by this Court, Article 448 of the Civil Code, applies only
where one builds on land in the belief that he is the owner of the land, but does not apply where one's
interest in the land is that of a lessee under a rental contract (Balucanag v. Francisco, 122 SCRA 498
[1983]). More than that, it has been settled that the mere fact that, in his answer, defendant claims to
be the exclusive owner of the property from which plaintiff seeks to eject him is not sufficient to divest
the Municipal Trial Court of jurisdiction.
In addition, this Court held in Bocaling v. Laguna, et al (54 SCRA 243, 250 [1973]) that:
"The rule is well-settled that lessees, like petitioner, are not possessors in good faith, because he knew
that their occupancy of the premises continues only during the life of the lease, and they cannot as a
matter of right, recover the value of their improvements from the lessor, much less retain the premises
until they are reimbursed. Their rights are governed by Article 1678 of the Civil Code which allows
reimbursement of lessees up to one-half of the value of their improvements if the lessor so elects."
Petitioners contend that the above cited case is "completely inapplicable to the case at bar, because the
genesis case of Ejectment therein was subjected to a compromise Agreement" (Rollo, p. 18). Such
contention is, however, untenable. One of the issues raised in the above-cited case was whether or not
lessees are builders and/or possessors in good faith entitled to reimbursement for the value of their
improvements. The Court categorically resolved the issue in the negative without qualification nor even
a reference to the compromise agreement alluded to by the petitioner.
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In view thereof, petitioners maintain that they are the lawful owners of the buildings and the legal
possessors of subject land and that the records of the court proceedings show the pendency of the
administrative protest before the Bureau of Lands between the same litigating parties (Rollo, pp. 166-
167).
Respondents countered that the decision of the Bureau of Lands granting preferential right to the
petitioners to apply for the subject parcel of land is still on appeal before the Department of Natural
Resources.1 Hence, said decision which is not yet final, cannot affect the outcome of this case because
the authority given to the land department over the disposition of public land does not exclude the courts
from their jurisdiction over possessory actions, the character of the land notwithstanding (Rollo, pp. 246-
247).
The contention of private respondents is well taken. This issue has long been laid to rest by this Court.
Sarmiento vs. Agana 129 SCRA122
Facts:
ERNESTO was still courting his wife, the latter's mother had told him the couple could build a
RESIDENTIAL HOUSE whom Ernesto did construct a RESIDENTIAL HOUSE on the LAND at a cost of
P8,000.00 to P10,000.00 who probably assumed that the wife's mother was the owner of the LAND and
that, it would be transferred to the spouses. Subsequently turned out that the LAND had been titled in
the name of Mr. & Mrs. Jose C. Santo, Jr. who, sold the same to petitioner SARMIENTO. SARMIENTO
filed an Ejectment suit against them. In the evidentiary hearings before the Municipal Court, SARMIENTO
submitted the deed of sale of the LAND in her favor, which showed the price to be P15,000.00. On the
other hand, ERNESTO testified that the then cost of the RESIDENTIAL HOUSE would be from P30,000.00
to P40,000.00.Sarmiento refuse to pay and give option to buy the property.
Issue:
- Whether or not Ernesto was in good faith.
- Whether or not Sarmiento could exercise both refusal to pay the spouses and give option to
purchase.
Held:
First Issue:
Yes. We agree that ERNESTO and wife were builders in good faith in view of the peculiar circumstances
under which they had constructed the RESIDENTIAL HOUSE. As far as they knew, the LAND was owned
by ERNESTO's mother-in-law who, having stated they could build on the property, could reasonably be
expected to later on give them the LAND.

In regards to builders in good faith, Article 448 of the Code provides:têñ.£îhqwâ£
ART. 448. The owner of the land on which anything has been built, sown or planted in
good faith,shall have the rightto appropriate as his own the works, sowing or planting,
after payment of the indemnity provided for in articles 546 and 548, or to oblige the
one who built or planted to pay the price of the land, and the one who sowed, the
proper rent.However, the builder or planter cannot be obliged to buy the land if its
value is considerably more than that of the building or trees. In such case, he shall pay
reasonable rent, if the owner of the land does not choose to appropriate the building
or trees after proper indemnity. The parties shall agree upon the terms of the lease
and in case of disagreement, the court shall fix the terms thereof.
Second Issue:
No. The owner of the building erected in good faith on a land owned by another, is entitled to retain the
possession of the land until he is paid the value of his building, under article 453 (now Article 546). The
owner, of the land. upon, the other hand, has the option, under article 361 (now Article 448), either to
pay for the building or to sell his land to the owner of the building. But he cannot, as respondents here
did, refuse both to pay for the building and to sell the land and compel the owner of the building to
remove it from the land where it is erected. He is entitled to such remotion only when, after having
chosen to sell his land, the other party fails to pay for the same.
G.R. NO. 151815. FEBRUARY 23, 2005
SPOUSES JUAN NUGUID AND ERLINDA T. NUGUID VS. HON. COURT OF APPEALS AND PEDRO
P. PECSON
FACTS:
Pedro P. Pecson owned a commercial lot on which he built a four-door two-storey apartment
building. For failure to pay realty taxes, the lot was sold at public auction by the City Treasurer to
Mamerto Nepomuceno, who in turn sold it for P103,000 to the spouses Juan and Erlinda Nuguid.
Pecson challenged the validity of the auction sale before the RTC of Quezon City, the RTC upheld
the spouses’ title but declared that the four-door two-storey apartment building was not included in the
auction sale. This was affirmed by the CA and by the SC.
The Nuguids became the uncontested owners of commercial lot. The Nuguid spouses moved for
delivery of possession of the lot and the apartment building.
ISSUE: WON the Nuguids should reimburse Pecson for the benefits derived from the apartment building.
HELD: YES. Since petitioners opted to appropriate the improvement for themselves as early as June 1993,
when they applied for a writ of execution despite knowledge that the auction sale did not include the
apartment building, they could not benefit from the lot’s improvement, until they reimbursed the improver
in full, based on the current market value of the property.
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MIDTERMS CASE DIGEST IN PROPERTY- TIAMZON 19
Under Article 448, the landowner is given the option, either to appropriate the improvement as
his own upon payment of the proper amount of indemnity or to sell the land to the possessor in good
faith. Relatedly, Article 546 provides that a builder in good faith is entitled to full reimbursement for all
the necessary and useful expenses incurred; it also gives him right of retention until full reimbursement
is made.
The right of retention is considered as one of the measures devised by the law for the protection
of builders in good faith. Its object is to guarantee full and prompt reimbursement as it permits the
actual possessor to remain in possession while he has not been reimbursed (by the person who defeated
him in the case for possession of the property) for those necessary expenses and useful improvements
made by him on the thing possessed.
Given the circumstances of the instant case where the builder in good faith has been clearly
denied his right of retention for almost half a decade, we find that the increased award of rentals by the
RTC was reasonable and equitable. The petitioners had reaped all the benefits from the improvement
introduced by the respondent during said period, without paying any amount to the latter as
reimbursement for his construction costs and expenses. They should account and pay for such benefits.
Balucanag vs. Judge Francisco (1983)
Facts:
The petitioner bought a lot owned by Mrs. Charvet which was then previously leased by the latter to one
Richard Stohner. The said lease contract provided that the lessee may erect structures and improvements
which shall remain as lessee's property and he may remove them at any time. It further provided that
should the lessee fail to remove the same structures or improvements withing two months after the
expiration of the lease, the lessor may remove them or cause them to be removed at the expense of the
lessee. Stohner made fillings on the land and constructed a house. When he failed to pay the rent, the
petitioner, through counsel, sent Stohner a demand letter ordering him to vacate the lot. The lessee
contended that he is a 'builder in good faith.
Issue: Is the lessee a builder in good faith?
Held:
No, the lessee cannot be considered a builder in good faith. The provision under Art. 448 of the New Civil
Code (Philippine) on a builder of good faith applies only to the owner of the land who believes he is the
rightful owner thereof, but not to a lessee who's interest in the land is derived only from a rental contract.
Neither can Stohner be considered a 'possessor in good faith'. A possessor in good faith is a party who
possesses property believing that he is its rightful owner but discovers later on a flaw in his title that could
indicate that he might not be its legal owner. It cannot apply to a lessee because he knows right from the
start that he is merely a lessee and not the owner of the premises.
As a mere lessee, he introduces improvements to the property at his own risk such that he cannot recover
from the owner the reimbursements nor he has any right to retain the premises until reimbursements.

What applies in this case is Art. 1678 (NCC) which provides that, " if the lessee, makes, in good faith,
useful improvements which are suitable to the use for which the lease is intended, without altering the
form or substance of the property leased, the lessor upon the termination of the lease shall pay the lessee
1/2 of the value of the improvements at the time. Should the lessor refuse to reimburse said amount, the
lessee may remove the improvements even though the principal thing may suffer damage thereby. He
shall not. however, cause any more impairment upon the property leased than is necessary."
96 SCRA 130 February 21, 1980
FLOREZA v EVANGELISTA
FACTS:
The Evangelistas were the owner of a residential lot in Rizal with an area of 204.08 sq. m.
assessed at P410. They borrowed P100 from Floreza. Floreza occupied the residential lot and built a
house of light material (barong-barong) with the consent of the Evangelistas. Additional Loans were made
by the Evangelistas.
Floreza demolished the house of light material and constructed one of strong material assessed.
Floreza has not been paying any rentals since the beginning of their transactions. Eventually, Evangelistas
sold, with a right to repurchase within 6 years, their land to Floreza. Seven months before the expiry of
the repurchase period, the Evangelistas were able to pay in full. Floreza refused to vacate the lot unless
he was first reimbursed for the value of the house he built
Evangelistas filed a complaint. CFI ruled based on Art, 448 of the Civil Code saying that
Evangelistas have the choice between purchasing the house or selling the land to Floreza. CA ruled that
Art. 448 was inapplicable and that Floreza was not entiled to the reimbursement of his house and could
remove the same at his own expense.
ISSUE:
1. WON Floreza was entitled to reimbursement of the cost of his house.
2. WON he (his heirs who replaced him) should pay rental of the land.
HELD:
First Issue: NO.
Issue of reimbursement is not moot because if Floreza has no right of retention, then he must pay
damages in the form of rentals. Agree with CA that Art. 448 is inapplicable because it applies only when
the builder is in good faith (he believed he had a right to build). Art. 453 is also not applicable because it
requires both of the parties to be in bad faith. Neither is Art. 1616 applicable because Floreza is not a
vendee a retro. The house was already constructed in 1945 (light materials) even before the pacto de
retro was entered into in 1949. Floreza cannot be classified as a builder in good faith nor a vendee a
retro, who made useful improvements during the pacto de retro, he has no right to reimbursement of
the value of the house, much less to the retention of the premises until he is paid.
His rights are more akin to a usufructury under Art. 579, who may make on the property useful
improvements but with no right to be indemnified thereof, He may, however, remove such improvements
should it be possible to do so without damage to the property.
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Second Issue: YES.
From the time the redemption price was paid in January 3, 1955, Floreza’s right to use the residential lot
without rent ceased. He should be held liable for damages in the form of rentals for the continued use of
the lot for P10 monthly from January 3, 1955 until the house was removed and the property vacated by
Floreza or his heirs. Judgment affirmed with modification.
Carbonell vs. Court of Appeals, 69 SCRA 99, No. L-29972 January 26, 1976
Civil Code; Property; Possession; Sale; In case of double sale of an immovable property, second
paragraph of Article 1544 directs that ownership should be recognized in favor of one who in good faith
first recorded his right. If there is no inscription, what is decisive is prior possession in good faith
Unlike the first and third paragraphs of said Article 1544, which accord preference to the one who first
takes possession in good faith of personal or real property, the second paragraph directs that ownership
of immovable property should be recognized in favor of one “who in good faith first recorded” his right.
Under the first and third paragraphs, good faith must characterize the prior possession. Under the second
paragraph, good faith must characterize the act of anterior registration. If there is no inscription, what is
decisive is prior possession in good faith. If there is inscription, as in the case at bar, prior registration in
good faith is a pre-condition to superior title.
Circumstances which indicate prior possession in good faith in case of double sale of
immovable property
When Carbonell bought the lot from Poncio on January 27, 1955, she was the only buyer thereof and the
title of Poncio was still in his name solely encumbered by bank mortgage duly annotated thereon.
Carbonell was not aware—and she could not have been aware—of any sale to Infante as there was no
such sale to Infante then. Hence, Carbonell’s prior purchase of the land was made in good faith. Her
good faith subsisted and continued to exist when she recorded her adverse claim four days prior to the
registration of Infantes’s deed of sale. Carbonell’s good faith did not cease after Poncio told her on January
31, 1955 of his second sale of the same lot to Infante. Because of that information, Carbonell wanted an
audience with Infante, which desire underscores Carbonell’s good faith. With an aristocratic disdain
unworthy of the good breeding of a good Christian and good neighbor, Infante snubbed Carbonell like a
leper and refused to see her. So Carbonell did the next best thing to protect her right—she registered
her adverse claim on February 8, 1955. Under the circumstances, this recording of her adverse claim
should be deemed to have been done in good faith and should emphasize Infante’s bad faith when she
registered her deed of sale four days later on.
Circumstances which show bad faith in case of double sale of immovable property
Bad faith arising from previous knowledge by Infante of the prior sale to Carbonell is shown by the
following facts, the vital significance and evidentiary effect of which the respondent Court of Appeals

either overlooked or failed to appreciate: (1) Mrs. Infante refused to see Carbonell, who wanted to see
Infante after she was informed by Poncio that he sold the lot to Infante but several days before Infante
registered her deed of sale, This indicates that Infante knew—from Poncio and from the bank—of the
prior sale of the lot by Poncio to Carbonell. x x x (2) Carbonell was already in possession of the mortgage
passbook and Poncio’s copy of the mortgage contract, when Poncio sold the lot to Infante. This also
shows that the lot was already sold to Carbonell who, after paying the arrearages of Poncio, assumed
the balance of his mortgage indebtedness to the bank, which in the normal course of business must have
necessarily informed Infante about the said assumption by Carbonell of the mortgage indebtedness of
Poncio. x x x (3) The fact that Poncio was no longer in possession of his mortgage passbook should have
compelled Infante to inquire from Poncio why he was no longer in possession of the mortgage passbook
and from Carbonell why she was in possession of the same, x x x (4) Carbonell registered on February
8, 1955 her adverse claim which was accordingly annotated on Poncio’s title, four days before Infante
registered on February 12, 1955 her deed of sale executed on February 2, 1955. Here she was again on
notice on the prior sale to Carbonell.
Where immovable was sold twice, the one with superior title should refund the sum paid by other vendee
to redeem mortgage on the land.—While petitioner Carbonell has the superior title to the lot, she must
however refund to respondents Infantes the amount of P1,500.00, which the Infantes paid to the Republic
Savings Bank to redeem the mortgage.
As a matter of equity, possessor in bad faith is entitled to remove one useful expenditures
made by him, such as drainage construction, walled fence and bungalow, if lawful possessor
fails to refund the same.—It appearing that the Infantes are possessors in bad faith, their rights to
the improvements they introduced on the disputed lot are governed by Articles 546 and 547 of the New
Civil Code. Their expenses consisting of P1,500.00 for draining the property, filling it with 500 cubic
meters of garden soil, building a wall around it and installing a gate and P11,929.00 for erecting a
bungalow thereon, are useful expenditures, for they add to the value of the property. x x x If the lawful
possessor can retain the improvements introduced by the possessor in bad faith for pure luxury or mere
pleasure only by paying the value thereof at the time he enters into possession (Art. 549 NCC), as a
matter of equity, the Infantes, although possessors in bad faith, should be allowed to remove the
aforesaid improvements, unless petitioner Carbonell chooses to pay for their value at the time the Infantes
introduced said useful improvements in 1955 and 1959. The Infantes cannot claim reimbursement for
the current value of the said useful improvements; because they have been enjoying such improvements
for about two decades without paying any rent on the land and during which period herein petitioner
Carbonell was deprived of its possession and use.
Facts:
Private respondent Poncio was the owner of a parcel of land in Batanes, mortgaged in favor of republic
savings bank. Petitioner Carbonell and respondent Infante both offered to buy the property from Poncio.
Poncio, in his failure to pay the mortgaged, agreed for the petitioner to buy the land excluding his house
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on the condition that from the purchase price would come from the money to be paid to the bank.
Subsequently, Poncio had told Carbonell that the former can no longer pursue with the sale for he had
given the land to Infante. The said lot was fenced by Infante.
Informed that the sale in favor of respondent Infante had not yet been registered, Atty. Garcia (carbonell’s
counsel) prepared an adverse claim for petitioner, and registered the same on February 8, 1955. The
deed of sale in favor of Infante was registered only on February 12, 1955. As a consequence thereof, a
Transfer Certificate of Title was issued to her but with the annotation of the adverse claim of petitioner
Carbonell.
Petitioner filed a complaint, praying that the sale between Poncio and Infante be declared null and void.
ISSUE: Who has the superior right over the property?
HELD: The SC declared the first buyer Carbonell to have the superior right over the property, relying on
article 1544, to wit:
“If the same thing should have been sold to different vendees, the ownership shall be transferred to the
person who may have first taken possession thereof in good faith, if it should movable property.
Should it be immovable property, the ownership shall belong to the person acquiring it who in good faith
first recorded it in the Registry of Property. xxx”
The second paragraph of said article directs that ownership of immovable property should be recognized
in favor of one “who in good faith first recorded” his right. Good fait must characterize the act of anterior
registration.
When Carbonell bought the lot from Poncio, she was the only buyer thereof and the title of Poncio was
still in his name solely encumbered by a bank mortgage duly annotated thereon. Carbonell was not aware
– and she could not have been aware – of any sale to Infante as there was no such sale to Infante then.
Under the circumstances, the recording of Carbonell’s adverse claim should be deemed to have been
done in good faith and should emphasize Infante’s bad faith when the latter registered her deed of sale
only 4 days after Carbonell’s registration of adverse claim.
Quemuel vs Olaes (1961)
Ownership; Accession; Improvements on land; Builders in good faith; Right of landowner and builder:
Option granted to landowner.—The right to appropriate the works or improvements or to oblige the
builder or planter to pay the price of the land belongs to the landowner. The only right given to the
builder in good faith is the right to reimbursement for the improvements; he cannot compel the owner of
the land to sell it to him.
Same; Tenant cannot be a builder in good faith.—Article 448 of the New Civil Code is intended to apply
only to a case where one builds, or sows, or plants on land in which he believes himself to have a claim

of title and not to lands wherein one's only interest is that of a tenant and a tenant cannot be said to be
a builder in good faith, as he has no pretention to be an owner of the land.
Facts:
Angel S. Olaes and his wife, Juliana Prudente, defendants-appellees herein, were plaintiffs in another
case (No. 5442 of the CFI of Cavite), wherein Alejandro Quemuel and his wife Ruperta Solis, plaintiffs-
appellants herein were defendants. In that case No. 5442, the Olaes spouses, registered owners of lot
1095 of the San Francisco de Malabon Estate, located in Rosario, Cavite, sought the recovery of the
possession of the said lot and rentals therefor, from the Quemuel spouses, who in their verified answer
admitted plaintiffs' ownership, but contended that their occupation was gratuitous. On March 16, 1954,
the trial court ordered Quemuel and his wife to return the possession of lot 1095 to the Olaes spouses
and to pay the latter P20.00 a month from January, 1954, until they shall have vacated the premises,
Quemuel and his wife did not appeal from said decision which became final on April 22, 1954. Thereafter,
the Olaes spouses sought the execution of the decision and to forestall ejectment, the Quemuel spouses,
filed on July 1, 1954, the present complaint, docketed as Civil Case No. 5518, CFI of Cavite.
In the present complaint, the Quemuel spouses seek to reduce the monthly rental of P20.00 fixed in Civil
Case No. 5442, and to compel the Olaes spouses to sell to them (Quemuels) the portion of the lot 1095
where their house is erected. Respondents, the Olaes spouses, filed a motion to dismiss dated July 9,
1954, alleging lack of cause of action, res adjudicata; prescription, and the cause of action, if any, is
barred by plaintiffs' failure to set it up as a counter-claim in civil case No. 5442.
On September 17, 1954, the trial court dismissed the complaint, without pronouncement as to costs.
An appeal was taken by plaintiffs to the Court of Appeals (Case No. CA-G.R. No. 14837-R) which, by the
agreement of the parties certified the case to this Court. The ex parte petition filed by the plaintiffs-
appellants in this Court on August 9, 1956, asking that a writ of prohibition and injunction be issued to
the Provincial Sheriff of Cavite and the defendants-appellees, enjoining them from demolishing the house
of plaintiffs-appellants until there is a final decision in said case No. 14837, by the Supreme Court, was
denied on August 14, 1956 by the latter court.
The lone assignment alleges that the trial court erred in dismissing the complaint without trial on the
merits and in not granting the reliefs prayed for by the plaintiffs appellants. Appellants stated in their
brief that if there will be trial on the merits, they would be entitled to a decision in their favor, because
they will establish by competent evidence the allegations in their complaint. And on the claim that they
were builders in good faith, they based the right to buy the lot on which their house is built,.
Held:
On the assumption that the allegations of the second cause of action are true, what would be the rights
of the parties? The plaintiffs claim that their second cause of action is based on Article 448 in connection
with Art. 546, of the new Civil Code. A cursory reading of these provisions, however, will show that they
are not applicable to plaintiffs' case. Under Article 448, the right to appropriate the works or improvements
or "to oblige the one who built or planted to pay the price of the land" belongs to the owner of the land.
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The only right given to the builder in good faith is the right to reimbursement for the improvements; the
builder, cannot compel the owner of the land to sell such land to the former. This is assuming that the
plaintiffs are builders in good faith. But the plaintiffs are not builders in good faith. From the pleadings
and the documentary evidence submitted, it is indisputable that the land in question originally belonged
to the government as part of the Friar Lands Estate and the title thereto was in the name of the
government, until it was purchased by Agapita Solis who applied, thru the Bureau of Lands, to purchase
the land by installments. The corresponding Sale Certificate No. 531, effective July 1, 1909 Exhibit 2) was
executed. In defendants' complaint (as plaintiffs in Civil Case No. 5442), they alleged that they are the
owners of lot 1095 and that defendants (plaintiffs herein), "have been occupying southeastern half
portion thereof, without any right thereto, except the tolerance of plaintiffs" (defendants herein), which
were admitted expressly and under oath, in the answer of plaintiffs herein. It would, therefore, appear
that plaintiffs herein were not unaware of the flaw in their title, if any, and that their true relation with
the herein def endants was that of tenant and landlord, and that their rights are governed by Article 1573
in relation to article 487 of the old Civil Code, which reads as follows:
"Art. 1573. A lessee shall have with respect to useful and voluntary improvements, the same right which
are granted the usufructuaries."
"Art. 487. The usuf ructuary may make on the property held in usufruct any improvements, useful or
recreative, which he may deem proper, provided he does not change its form or substance, but he shall
have no right to be indemnified therefor, He may, however, remove such improvements, should it be
possible to do so without injury to the property".
From the above provisions, it can clearly be inferred that plaintiffs can not compel the defendants to pay
for the improvements the former made on the property or to sell the latter's land. Plaintiffs' only right, is
to remove the improvements, if it is possible to do so, without damage to the land.
It should be noted that article 448 of the new Civil Code, (equivalent to Art. 361 of the old Civil Code),
relied upon by plaintiffs, is intended to apply only to a case where one builds, or sows, or plants on land
in which he believes himself to have a claim of title and not to lands wherein one's interest is that of
tenant, under a rental contract, which is the present case. The tenant cannot be said to be a builder in
good faith as he has no pretension to be owner
Resuena vs. Court of Appeals, 454 SCRA 42, G.R. No. 128338 March 28, 2005
Article 487 of the Civil Code, which provides simply that “[a]ny one of the co-owners may bring an action
in ejectment,” is a categorical and an unqualified authority in favor of respondent to evict petitioners from
the portions of Lot. No. 2587. This provision is a departure from Palarca v. Baguisi, which held that an
action for ejectment must be brought by all the co-owners. Thus, a co-owner may bring an action to
exercise and protect the rights of all. When the action is brought by one co-owner for the benefit of all,
a favorable decision will benefit them; but an adverse decision cannot prejudice their rights. Respondent’s
action for ejectment against petitioners is deemed to be instituted for the benefit of all co-owners of the
property since petitioners were not able to prove that they are authorized to occupy the same.

All six (6) petitioners claim the right to be reimbursed “necessary expenses” for the cost of constructing
their houses in accordance with Article 546 of the Civil Code. It is well-settled that while the Article allows
full reimbursement of useful improvements and retention of the premises until reimbursement is made,
applies only to a possessor in good faith, i.e., one who builds on land with the belief that he is the owner
thereof. Verily, persons whose occupation of a realty is by sheer tolerance of its owners are not possessors
in good faith.
Macasaet vs. Macasaet, 439 SCRA 625, G.R. Nos. 154391-92 September 30, 2004
Ejectment; Unlawful Detainer; In actions for unlawful detainer, possession that was originally lawful
becomes unlawful upon the expiration or termination of the defendant’s right to possess, arising from an
express or implied contract.—In actions for unlawful detainer, possession that was originally lawful
becomes unlawful upon the expiration or termination of the defendant’s right to possess, arising from an
express or implied contract. In other words, the plaintiff’s cause of action comes from the expiration or
termination of the defendant’s right to continue possession. The case resulting therefrom must be filed
within one year from the date of the last demand.
Same; Same; To show a cause of action in an unlawful detainer, an allegation that the defendant is
illegally withholding possession from the plaintiff is sufficient.—To show a cause of action in an unlawful
detainer, an allegation that the defendant is illegally withholding possession from the plaintiff is sufficient.
The complaint may lie even if it does not employ the terminology of the law, provided the said pleading
is couched in a language adequately stating that the withholding of possession or the refusal to vacate
has become unlawful. It is equally settled that the jurisdiction of the court, as well as the nature of the
action, is determined from the averments of the complaint.
Same; Same; This court has consistently held that those who occupy the land of another at the latter’s
tolerance or permission, without any contract between them, are necessarily bound by an implied promise
that the occupants will vacate the property upon demand. A summary action for ejectment is the proper
remedy to enforce this implied obligation.—This Court has consistently held that those who occupy the
land of another at the latter’s tolerance or permission, without any contract between them, are necessarily
bound by an implied promise that the occupants will vacate the property upon demand. A summary action
for ejectment is the proper remedy to enforce this implied obligation. The unlawful deprivation or
withholding of possession is to be counted from the date of the demand to vacate.
Respondents have the right to appropriate—as their own—the building and other improvements on the
subject lots, but only after (1) refunding the expenses of petitioners or (2) paying the increase in value
acquired by the properties by reason thereof. They have the option to oblige petitioners to pay the price
of the land, unless its value is considerably more than that of the structures—in which case, the petitioners
shall pay reasonable rent.—Respondents have the right to appropriate—as their own—the building and
other improvements on the subject lots, but only after (1) refunding the expenses of petitioners or (2)
paying the increase in value acquired by the properties by reason thereof. They have the option to oblige
petitioners to pay the price of the land, unless its value is considerably more than that of the structures—
in which case, petitioners shall pay reasonable rent.
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Spouses Del Campo vs. Abesia, 160 SCRA 379, No. L49219 April 15, 1988
Civil Law; Property; Builder in good faith; Co-ownership; When a co-ownership is terminated by the
partition and the house of defendants overlaps a portion of the land of plaintiffs which defendants built
in good faith, Article 448 of the Civil Code applies; Article 448 may apply even when there was co-
owner$hip if good faith has been established.—However, when, as in this case, the co-ownership is
terminated by the partition and it appears that the house of defendants overlaps or occupies a portion of
5 square meters of the land pertaining to plaintiffs which the defendants obviously built in good faith,
then the provisionB of Article 448 of the new Civil Code should apply. Manresa and Navarro Amandi agree
that the said provision of the Civil Code may apply even when there was co-ownership if good faith has
been established.
Same; Same; Same; Same; Right of a builder in good faith under Article 546 of the Civil Code.—Applying
the afore-said provision of the Civil Code, the plaintiffs have the right to appropriate said portion of the
house of defendants upon payment of indemnity to defendants as provided for in Article 546 of the Civil
Code. Otherwise, the plaintiffs may oblige the defendants to pay the price of the land occupied by their
house. However, if the price asked for is considerably much more . than the value of the portion of the
house of defendants built thereon, then the latter cannot be obliged to buy the land. The defendants
shall then pay the reasonable rent to the plaintiffs upon such terms and conditions that they may agree.
In case of disagreement, the trial court shall fix the terms thereof. Of course, defendants may demolish
or remove the said portion of their house, at their own expense, if they so decide.
Sarona vs. Villegas, 22 SCRA 1257, No. L-22984 March 27, 1968
Forcible entry and detainer; Forcible entry distinguished from unlawful detainer; Nature of entry
determines cause of action.—Section 1, Rule 70 of the Revised Rules of Court defines two entirely distinct
causes of action, to wit: (a) action to recover possession founded on illegal occupation from the
beginning—forcible entry; and (b) action founded on unlawful detention by a person who originally
acquired possession lawfully—unlawful detainer. The law and jurisprudence leave no doubt that what
determines the cause of action is the nature of defendant's entry into the land. .If entry is illegal, then
the cause of action which may be filed against the intruder within one year therefrom is forcible entry.
If, on the other hand, entry is legal but thereafter possession became illegal, the case is one of illegal
detainer which must be filed within one year from the date of last demand.
Unlawful detainer; Tolerance must be from the start of possession sought to be recovered.—A close
assessment of the law and the concept of the word "tolerance" show that such tolerance must be present
right from the start of possession sought to be recovered, to categorize a cause of action as one of
unlawful detainer—not of forcible entry.
Forcible entry and unlawful detainer; Failure to bring action within one year; Remedy.—It is well to
remember that after the lapse of the one year period, suit must be started in the Court of First Instance
in an accion publiciana.
Acquisition of Possession

Director of Lands vs. Roman Catholic Bishop of Zamboanga, 61 Phil., 644, No. 40851 July 31,
1935
PROPERTIES OF THE CHURCH; OWNERSHIP; POSSESSION.—The possession by the Roman Catholic
Apostolic Church of the lands in dispute for a period of about a century and a half, under the conditions
stated, can mean nothing more than that said lands were designated by the State itself to be devoted to
the building of the church, belfry and convent for the purpose of implanting the Roman Catholic Apostolic
Religion and maintaining the cult thereof.
2.ID.; OWNERSHIP OF SCHOOL BUILDINGS.—The circumstance that public schools for children of both
sexes were erected on lot No. 3 during the Spanish regime is not conclusive evidence that the land was
segregated from the great portion thereof designated for the Roman Catholic Apostolic Church and its
cults particularly if we take into account the fact that primary instruction was then under the direct
supervision of the parish priests who received subsidy from the government.
3.ID.; PROOF OF OWNERSHIP.—Neither does the existence of a monument of Rizal on said land prove
the ownership of the municipality of Misamis, nor can the recent occupation thereof be invoked as a title
thereto. It should be interpreted as a tolerated possession in accordance with articles 444 and 447 of the
Civil Code which in no way can be made the basis for the adjudication of a title.
4.ID.; REGISTRATION BY MUNICIPALITIES.—The lower court found that lots Nos. 1, 2 and 3 are public
plazas, as claimed by the municipality of Misamis, and decreed the registration thereof in the name of
the said municipality. Held: That the decree is untenable because if they are public plazas they are not
susceptible of registration in the name of any branch of the State.
Director of Lands vs. Roman Archbishop of Manila., 41 Phil. 120, No. 14869 October 27, 1920
CADASTRAL PROCEEDINGS; NATURE; TRIALS.—A cadastral petition is in the nature of a proceeding in
rem, promoted by the Director of Lands, somewhat akin to a judicial inquiry and investigation leading to
a judicial decree. In one sense, in cadastral proceedings, there is no plaintiff and there is no defendant.
In another sense, the Government is the plaintiff and all the claimants are defendants. The usual rules
of practice, procedure, and evidence govern registration proceedings. The trial opened with a stipulation
that the composition title of the church with the Spanish Government included the land in question. The
church presented one witness and rested. The private oppositors then called their respective witnesses
to prove title by possession, and rested. Counsel for the church thereupon made an offer to present
additional testimony intended to show that the possession of the private claimants had been interrupted
and that it was merely possession through the tolerance of the church. Held: That the offer of counsel
for the church could properly be classified as rebuttal evidence and that in the interest of justice and the
ascertainment of the truth, it should have been received.
Sarona vs. Villegas, 22 SCRA 1257, No. L-22984 March 27, 1968
Forcible entry and detainer; Forcible entry distinguished from unlawful detainer; Nature of entry
determines cause of action.—Section 1, Rule 70 of the Revised Rules of Court defines two entirely distinct
causes of action, to wit: (a) action to recover possession founded on illegal occupation from the
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beginning—forcible entry; and (b) action founded on unlawful detention by a person who originally
acquired possession lawfully—unlawful detainer. The law and jurisprudence leave no doubt that what
determines the cause of action is the nature of defendant's entry into the land. .If entry is illegal, then
the cause of action which may be filed against the intruder within one year therefrom is forcible entry.
If, on the other hand, entry is legal but thereafter possession became illegal, the case is one of illegal
detainer which must be filed within one year from the date of last demand.
Unlawful detainer; Tolerance must be from the start of possession sought to be recovered.—A close
assessment of the law and the concept of the word "tolerance" show that such tolerance must be present
right from the start of possession sought to be recovered, to categorize a cause of action as one of
unlawful detainer—not of forcible entry.
Forcible entry and unlawful detainer; Failure to bring action within one year; Remedy.—It is well to
remember that after the lapse of the one year period, suit must be started in the Court of First Instance
in an accion publiciana.
Del Rosario vs. Lucena Et Al., 8 Phil. 535, No. 3546 September 13, 1907
CONFLICT OF RlGHTS BETWEEN THE OWNER OF A THING AND THE CREDITOR PLEDGEE OF THE SAME
THING
If the defendant accepted jewels in pledge from a third person in the name of the owner thereof, without
ascertaining if the latter had given the former an order or other authority to pledge the jewels, the
defendant is responsible for having accepted the pledge even if in deciding- the matter she was
improperly or falsely informed, and it would be neither just, nor logical that the consequences of her
deception, upon finding out her own error or the deceit employed by a stranger, should fall on the owner
of the jewels who, without any act of her own, became the victim of a crime. The conflict between the
owner of the movable property who lost it or was deprived thereof illegally and the creditor who loaned
money thereon and holds it in pledge will not, as a general rule, be decided against the owner, to whom
the Civil Code grants right of action for the recovery thereof from whoever may be in possession. (Art.
464.)
Varela vs. Finnick, 9 Phil., 482, No. 3890 January 2, 1908
Crimes Against Property; Civil and Criminal Liability.—Where, in a proceeding instituted by reason of a
crime committed against prop-erty, the criminal liability of the accused has been declared, it follows that
he shall also be held civilly liable therefor, because every person who is criminally responsible on account
of a crime or misdemeanor is also civilly liable.
Recovery of Property Unlawfully in Possession.—Whoever may have been deprived of his property in
consequence of a crime is entitled to the recovery thereof, even if such property is in the possession of
a third party who acquired it by legal means other than those expressly stated in article 464 of the Civil
Code.

.Personal Property, Title by Possession.—In order that the possession of personal property may be
considered as a title thereto it is indis-pensable that the same shall have been acquired in good faith.
Ownership; Prescription.—The ownership of personal property prescribes in the manner and within the
time fixed by articles 1955 and 1962, in connection with article 464, of the Civil Code.
United States vs. Soriano and Villalobos., 12 Phil. 512, No. 4563 January 19, 1909
STOLEN PROPERTY; POSSESSION; PRESUMPTION.—A number of stolen carabaos were found in the
possession of a person who kept them hidden for a time and, a few days prior to their recovery, altered
the brands on the animals. Held, That, unless it be satisfactorily shown that the property was stolen by
some other person, he must be presumed to be the author of the theft and not merely an accessary.
ACQUISITION IN GOOD FAITH; RIGHT OF OWNER TO RECOVER.—Although stolen property is acquired
in good faith by a third party, he can not lawfully withhold the possession thereof from the true owner
and insist upon reimbursement before delivery.
United States vs. Sotelo., 28 Phil., 147, No. 9791 October 3, 1914
ESTAFA; JEWELRY DELIVERED TO BE SOLD OR RETURNED.—On the 2d of January, 1914,,the owner of
a ring delivered it to the defendant to be sold by him at a price not less than f*180 or f*190, undgr
obligation to return the same or'the purchase price within one hour thereafter; tliat the defendant did not
return either the ring or the purchase price within said time nor at an/ other time; that the failure to
return either the ring or the purchase price resulted in great prejudice and damage to the owner. ' Held:
That such facts constitute the crime of estafa.
DETERMINATION OF PENALTY.—In the erime of estafa the punishment to be imposed depends upon the
amount or value of the thing misappropriated.
CRIMINAL RESPONSIBILITY; OWNERSHIP OF THING MISAPPROPRIATED.—The fact that a person who
misappropriates property which he has received on commission, etc., obtained it from one who is not the
owner, will not relieve him from criminal responsibility when it appears that the real owner was prejudiced
by the misappropriation of the property. That fact is more particularly true when the person committing
the illegal act knew that the property did not belong to the holder, but to some other person.
RETURN OF PROPERTY MISAPPROPRIATED TO THE REAL OWNER.—It is a general principle that no man
can be divested of his property without his consent or voluntary act. Whoever may have been deprived
of his property in consequence of a crime is entitled to the recovery thereof, even if such property is in
the possession of a third party who acquired it by legal means other than those expressly stated in article
464 of the Civil Code. The only exception made by said article 464 seems to be when property has been
pledged in a "monte de piedad" established under authority of the Government. As a general rule,
whoever claims to have acquired property, real or personal, through some agent or person not the real
owner, must be prepared to show that the person from whom he purchased such property had authority
to transfer it. To this general rule there seem to be some exceptions: First. Where the owner has intrusted
or delivered to an agfint money or negotiable promissory notes and \vhere the same have been delivered
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or transferred to sorae innocent party; and, second, where the real owner is estopped, by reason of his
own acts or negligence.
Loss of Possession
United States vs. Rey, 8 Phil. 500, No. 3326 September 7, 1907
ROBBERY COMMITTED BY REMOVING CARGO FROM SUNKEN SHIP.—
U. and M. shipped money from the city of Manila on the steamship Cantabria. destined for C. En route
the said ship encountered a baguio and was sunk, with passengers, crew, and cargo. On the next day
the defendant:, together with others, discovering the locality of the sunken ship, entered the same and
look therefrom the sum of P15,000, inclosed in sealed boxes. Held, That the cargo was not abandoned
property and that the defendant and his companions were guilty of the crime of robbery; that property
can not be considered abandoned under the law and the possession left vacant for the finder until the
spes recuperandi is gone and the animus revertendi is finally given up.
Bishop of Cebu vs. Mangaron, 6 Phil., 286, No. 1748 June 1, 1906
REALTY; POSSESSION; CIVIL PROCEDURE; "ACCION PUBLICIANA."—Article 1635 of the old Code of Civil
Procedure not having been repealed by the Civil Code, if the acción publiciana existed prior to its
enactment it must necessarily exist after such enactment. Therefore the action brought by the plaintiff in
this case, to recover the possession of which he was unlawfully deprived by the defendant, can be
properly maintained under the provisions of the present Civil Code, considered as substantive law, without
prejudice to any right which he may have to the ownership of the property, which ownership he must
necessarily establish in order to overcome the presumption of title which exists in favor of the lawful
possessor, the plaintiff in this case, who had been in the quiet and peaceful possession of the land for
twenty years, more or less, at the time he was wrongfully dispossessed by the defendant.
Other Cases of Possession
Roxas et al. vs. Mijares, 9 Phil., 252, No. 3823 November 23, 1907
It is a principle of law that whoever enters into a contract does so for himself and for his heirs, and that
just as the latter succeed him in all his rights they also succeed him in all his obliga-tions; it is thus
acknowledged in numerous decisions and constitutes a legal rule.
Realty; Usurpation; Right to Possession.—The act of spoliation is a positive attempt against the rights of
a private individual and against public order, and it should be instantly suppressed without the necessity
of considering the title of the person dispossessed, this in order to avoid disturbances in the community
and prevent anyone from taking the administration of justice in his own hands; therefore, the possessor
in the capacity of owner as well as the mere tenant of the property the dominion over which pertains to
another, are entitled to ask for restitution and to exercise the proper action against the aggressor, even
though he be the proprietor.

Peaceful Possession; Owner's Right and Duty.—The lessee holds and enjoys the thing leased in the name
of the owner or lessor who is obliged to maintain the lessee in the peaceful enjoyment there-of, and if
the right of the owner to defend his property against any aggression in order to prevent serious injury to
his interests is un-questionable, it would be a, judicial absurdity to entrust with this obligation the tenant
or lessee whose rights and obligations are of a different nature.
Bago vs. Garcia, 5 Phil. 524, No. 2587 January 8, 1906
REALTY; ACTION; FORCIBLE ENTRY AND DETAINER.—One who claims the right of possession to real
property and who finds another in actual possession of the same, has 110 right by force and violence
personally to eject the latter, but must resort for his remedy to the courts. A decision of the courts
granting the right of possession to real property under section 80 of the Code of Procedure in Civil Actions,
if the action is brought within one year; does not prevent the parties from subsequently bringing an action
for the purpose of settling the title to said lands.
Heirs of Jumero vs. Lizares, 17 Phil. 112, No. 5051 September 27, 1910
1.SALE OF REALTY BY, OR WITHOUT A PUBLIC INSTRUMENT.—Under the laws of the Partidas, every
sale of realty did not necessarily have to be made by a public instrument. Law 6, title 5 of the 5th Partida
provides that the purchase and sale may be made in two ways—by a public instrument, and without one.
The first is when the vendee says to the vendor: “I wish that a document of sale be made.” Such a sale,
althongh the vendee and the vendor agree on the price, is not completed until the instrument is made
and executed, because, before that is done, one or the other may report. The sale may be made whether
an instrument when the vendee and the vendor both agree upon the price thereof and exchange the
thing for the price, without mentioning the instrument. According to the laws of the Partidas, the contract
of purchase and sale was, as it now is, eminently consensual and consent was sufficient to perfect it. It
could only be perfected by a public instrument when this form had also been the subject of consent and
the validity of the contract was made dependent thereon.
2.REALTY; RIGHTS OF OWNER IN POSSESSION.—One who has possessed a parcel of land for more than
forty years, and who claims to possess by virtue of a title of purchase, is a possessor under title of
ownership and, according to law, has in his favor the legal presumption that he holds the land under
sufficient title and he can not be obliged to produce the title. (Art. 448, Civil Code.) It is iucumbent upon
the person who denies such a title to prove a character distinct from that of owner, and only then can
the defendant be compelled to show the title which confers upon him the status of owner.
APPEAL from a judgment of the Court of First Instance of Occidental Negros. Jocson, J.
ARELLANO, C.J.:
Under the name of the heirs of Jumero, fifteen persons, as the grandchildren and great grandchildren of
Benedicto Jumero, demand the restitution of a piece of land which is, and has been for the past forty
years, in the possession of Jacinto Lizares. This land has an area of five hectares and sixty ares, and
adjoins on the north, east, and west, the property of Aniceto Lacson, and on the south, that of Gregoria
Vinco. It is alleged in the complaint that this land belonged to Benedicto Jumero, and that he willed it to
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his four children, all now deceased as well as the said Jumero, named Luisa, Felix, Florentino, and Pedro,
and that the plaintiffs, grandchildren and great grandchildren, descend from the three last mentioned.
The only descendant of Luisa, Gregoria Meruegos, is not a party to the suit and therefore appears as a
defendant together with Jacinto Lizares.
At the conclusion of the trial, Florentino’s children, named Anatolio, Hilaria, and Felisa, having testified
as witnesses for the defendant, Lizares, in opposition to the allegations of the complaint, were likewise
therein included as defendants, by an amendment authorized by the court. So that, of the heirs of
Benedicto Jumero, the descendant of one entire branch, Luisa, and three of those of another branch,
that of Florentino, impugned the complaint and take no part in the claim f or the restitution of the land
of their common predecessor in interest.
The following facts are admitted: First, that all the heirs named Jumero are actually the descendants of
Benedicto Jumero; second, that the land, which is the subject of the suit, passed into the possession of
Jacinto Lizares, for the sum of 50 pesos, about forty years before; and third, that the reason for this
transfer was the fact that Nicolas Jumero, a son of Felix, was drafted for the army, and to secure his
release from the military service, or to pay the attorney who was to negotiate the release, the 50 pesos
were required.
The whole question involved is whether the 50 pesos were received as a mortgage loan, as the plaintiffs
claim, or as the price of sale, as maintained from the beginning by the defendants, Jacinto Lizares and
Gregoria Meruegos, and subsequently by Anatolio, Hilaria, and Felisa Jumero, the latter represented by
her husband, Basilio Alferio. The plaintiffs claim that the land was delivered under mortgage in order that
Lizares might have the usufruct until it should be redeemed through the payment of the 50 pesos. The
defendants assert that the land was sold outright to Lizares for the price of 50 pesos.
The Court of First Instance of Occidental Negros decided the case in favor of the defendants and absolved
them from the complaint. The plaintiffs appealed.
Having forwarded a bill of exceptions, with a right to a revision of the evidence, two errors are alleged in
this instance against the judgment of the lower court.
First. For having admitted, notwithstanding the objection of the plaintiffs, the testimony introduced by
the appellees relative to the purchase of the land in question by Jacinto Lizares.
Second. Because the trial judge entertained doubt as to the character of the contract, by virtue of which
the defendant, Jacinto Lizares, possesses the land in question, and because, by reason of this doubt, he
absolved the defendants, and did not declare that there was a preponderance of evidence in favor of the
plaintiff appellants.
With respect to the first assignment of error, it is alleged that, as the question involves the purchase of
real estate, the testimony of witnesses is not admissible, and that at the time the land in question was
supposed to have been purchased, the laws of the Partidas were In force, and, in accordance with law
6, title 5, of the 5th Partida it was necessary’ for the validity of the contract that the sale be made by a
public instrument. The law cited provides that’ the purchase and sale may be made in two ways—by a

public instrument, and without one, The first is when the vendee says to the vendor: “I wish that a
document of sale be made.” Such a sale, although the vendee and the vendor agree on the price, is not
completed until the instrument is made and executed, because, before that is done, one or the other may
repent. The sale may be made without an instrument when the vendee and the vendor both agree upon
the price thereof and exchange the thing for the price, without mentioning the instrument.
The first assignment of error is therefore without foundation. In accordance with the legislation of the
Partidas, patterned after the Roman Law, the contract of purchase and sale is eminently consensual and,
consequently, only requires consent for its perfection. In order that an instrument be necessary it was
required that this form should also be the subject of consent and that the validity of the contract be made
dependent thereon: J wish a bill of sale to be made of the thing sold, was what the vendee should say
to the vendor, according to the law cited, in order that he might not be bound until after the execution
of the instrument.
As to the second assignment of error, it is true that. the trial judge while in doubt, and by reason of his
doubt, which still existed after weighing the contradictory testimony, decided the suit in favor of the
defendant, In so doing, lie committed no error whatever, but, on the contrary, complied with the second
paragraph of article 6 of the Civil Code, which provides:
“When there is no law exactly applicable to the point in controversy, the customs of the place shall be
observed, and, in the absence thereof, the general principles of law.”
And it is a general principle of law that, in case of doubt, the condition of he who possesses
is the better one. The defendant in whose favor the doubt was decided is the possessor.
But, in reality, it was not a case of doubt, neither with respect to the law nor the facts
adduced by the witnesses, whose testimony, rationally weighed, does not show an evident
preponderance of proof in favor of the plaintiffs, but all to the contrary.
By law, in conformity with article 448 of the Civil Code, this case could not but be decided in favor of the
defendant.
“The possessor by virtue of ownership has in his favor the legal presumption that he holds possession by
reason of a sufficient title and he can not be forced to show it.”
The defendant, Lizares. who has possessed the land in litigation for forty years, alleges that he is in
possession thereof by virtue of a title of purchase and sale, which is a title of transfer of ownership; he
is, consequently, the possessor under title of ownership, and, in conformity with the law, he has in his
favor the legal presumption that he possesses the land under sufficient title and he can not be obliged to
produce it. A purchase verbally made gives a perfect title which, with the occupation or possession of the
thing, confers ownership upon the possessor, provided that he holds himself out as its owner, until it be
proved that he is not. It was incumbent upon the plaintiffs to prove a character distinct from that of
owner, and only then could they compel the defendant to prove (rather than to show, as very properly
observes the learned commentator, Manresa) the title which actually confers upon him the status of
owner. But the plaintiffs were unable to prove a character distinct from that of owner, by due and
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sufficient proof of a title under mortgage, or that of antichresis, which latter was certainly unknown in
the Philippine Islands before the publication of the Civil Code, except in exceedingly rare cases of pretorian
pledges judicially established and approved—and this they were unable to do, for the reason that, as
established at the trial, no instrument whatever was executed of the alleged mortgage or of such an
antichresis; and, at all times, at least since the promulgation of the Civil Code, the mortgage and the
antichresis, as restrictions of ownership, must necessarily be recorded in writing, under the first paragraph
of rule 4 of the transitory provisions of the Civil Code, in connection with articles 1875, 1279, and 1280.
On these grounds alone, the judgment appealed from should be affirmed. But conceding, for a moment,
some value to the testimony taken, and on the hypothesis that it were necessary to consider it critically
and reasonably in order to reach a conviction beyond all doubt, by a preponderance of evidence offered
by one of the litigating parties, even then, and in such a case, this preponderance could not be admitted
in favor of the plaintiffs.
With all the testimony of the witnesses, proof was not adduced of the existence of the mortgage contract,
which, on the other hand, would not cause the debtor’s land to pass to the control of the creditor.
It is not irrational to accept as conclusive the testimony of the defendant’s witnesses, although they were
partnerson-shares of, or in any other manner dependent on, the defendant, because they testified against
their own interest in affirming that the land had been transferred by sale.
It is likely, considering the custom of the locality, and indeed a general one throughout the Islands, that
the land was sold with right of redemption, and hence that its redemption should be spoken of as possible
or as a mere concession on the part of the creditor; but, on such a hypothesis, it was a redemption which
could not be demanded of the vendee, by reason of the prescription acquired, whether the time is
computed in accordance with the previous legislation, or whether, as it is strictly proper, such time limit,
already expired, be that specified in the Civil Code; inasmuch as, even admitting that it was stipulated
that the right to repurchase or redeem should last for an indefinite time, such period is restricted to ten
years, under paragraph 2 of article 1508 of the Civil Code, and this period has already elapsed since its
promulgation. (Art. 1939, Civil Code.)
The judgment appealed from is affirmed, with the costs of this instance against the appellants.