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.
Whose concept?
Owner - Your own and others, must act and claim to be owner. Paying taxes, getting boarders.
What is the importance of this classification? If in concept of holder, the owner benefits from your possession.
If in the concept of owner, the possessor may get the property through acquisitive
prescription.
What are the two concepts of possession? 1. In the concept of owner – one who,
whether in good or bad faith, claims to be, and acts as if he is the owner. 2. In the concept of holder – one who
recognizes another to be the owner.
Article 526
. He is deemed a possessor ingood faith who is not aware that there exists in his title or mode of acquisition any flaw which invalidates it.
He is deemed a possessor in bad faith who possesses in any case contrary to the foregoing.
Mistake upon a doubtful or difficult question of law may be the basis of good faith.
The person here is not an owner – there is a flaw or defect.
What is the importance of distinguishing gf and bf?
Prescription Indemnity
Buyer buys title thinking the vendor is the person on the title GF.
Buys the property from the widow of a
deceased person, did not know she had children GF
Buys land with Torrens but title is annotated lis pendens BF
If you are in the business of lending money, you have to look beyond the title.
Can a person in possession of a valid Torrens title be in bad faith?
No. The articles on bad faith must be reconciled with the doctrine of indefeasibility of a Torrens title. It has been held by the SC that a holder of a title is in good faith until such title is declared null and void by the court.
What kind of mistake may be the basis of good faith?
It must be a mistake upon a doubtful or difficult question of law provided such ignorance is not gross and inexcusable.
Is bad faith transmissible to successors in interest?
Not necessarily. A child or heir may be presumed to be in good faith notwithstanding the father’s bad faith.
Article 527
. Good faith is always presumed, and upon him who alleges bad faith on the part of the possessor rests the burden of proof.What is the reason for presuming good faith? Presumption of innocence; everyone should be presumed honest until proven otherwise.
Good faith is always presumed and bad faith must be established by clear and convincing evidence.
Carreon v. Agcaoili
Carreon claimed that property inherited from her husband was hers along; a corresponding certificate/s of title was issued. The land was later sold to Agcaoili and a certificate/s of title was issued in his name.
Carreon’s children filed a complaint against Agcaoili to have the deed of sale declared as a mortgage and to recover ½ of the property – their action was predicated on Agcaoili’s bad faith.
ISSUE: Whether Agcaoili was in bad faith. HELD: Agcaoili was in good faith.
Good faith is always presumed and bad faith must be established by clear and convincing evidence.
In this case, there was no showing of bad faith on Agcaoili’s part. Though he was a townmate of the Carreon’s, he cannot be expected to know that his vendor had children.
Besides, the property was titled and the buyer had no responsibility to look beyond the title: which had an expired lien that was of no consequence to the purchase.
One who purchases real property which is in the actual possession of others should, at least, make some inquiry concerning the rights of those in possession.
Republic v. CA. 102 SCRA 331. L-42856.
Ramos filed a Homestead application for land in Nueva Ecija.
Pending this application, Ramos went to Isabela and found a piece of land covered by a Homestead application by Lopez but clearly abandoned by the latter. Ramos filed another application over this land.
Both Ramos’s applications were granted and he obtained a loan from PNB with the Isabela land as REM.
Subsequently, Ramos discovered that there were people occupying his Isabela land, he filed a complaint for the recovery of possession against them and won. These
people sent a petition to the SANR and alleged the nullity of Ramos’s second Homestead application, desiring to apply for patents on the same land.
ISSUE: Aside from the many Public Land Act issues, whether PNB, in accepting the REM of the Isabela property was in bad faith.
HELD: PNB was in bad faith.
One who purchases/accepts for REM real property which is in the actual possession of others should, at least, make some inquiry concerning the rights of those in possession. In the absence of such an inquiry, PNB cannot be considered as a good faith mortgagor as against such possessors.
However, since Ramos’s title over the land is valid, the REM is valid as between Ramos and PNB.
There is presumptive knowledge of the existence of a Torrens Title.
J.M. Tuason v. Munar J.M. Tuason, the owner of a subdivision, brought an action for ejectment against Munar.
Munar claims possession in good faith and raises the defense that Tuason’s certificate/s of title, which was issued more than 20 years before, was void due to fraud and that pursuant to a compromise agreement between Tuason and Deudor (Munar’s
predecessor in interest), Munar had a right to occupy the property.
ISSUE: Whether Munar can assail Tuason’s decree of registration and corresponding certificate/s of title 20 years after its issuance and whether Munar was a possessor in good