Property Reviewer

PRELIMINARY PROVISIONS

Art 414 All things which are or may be the object of appropriation are considered either:

1. Immovable or real property; or 2. Movable or personal property.

What’s a thing?

 any object that exists and is capable of satisfying some human needs

 includes both objects that are already possessed or owned and those that are susceptible of appropriation

 more comprehensive term (than property), as there are things which are not susceptible of appropriation and they are not included in the concept of property

What’s property?

 refers to any thing which is already the object of appropriation or found in the possession of man

Requisites of property 1. Utility

 Capacity to satisfy some human wants 2. Substantivity

 Quality of having existence apart from any other thing 3. Appropriability

 Susceptibility of being possessed by man

 Res communes or common things are not capable of appropriation in

their entirety, although they may be appropriated under certain conditions in a limited way, and thereby become property in law

o Electricity, oxygen, etc

 Res nullius or a thing may have no owner because it has not yet been

appropriated, or because it has been lost or abandoned by the owner. it constitutes property as long as it is susceptible of being possessed for the use of man

o Wild animals, hidden treasure

 Things cannot be considered as property when they are not susceptible of appropriation because of

o legal impossibility (you can’t sell your body while you’re alive,

at least not legally) or

o physical impossibility (you can’t own the moon, at least not yet)

Rights as property

 “property” is sometimes used to denote the thing with respect to which legal relations between persons exist – the res over which rights (particularly ownership) may be exercised – and sometimes to the rights with respect to the thing

 either real or property What is a real right?

 Right or interest belong to a person over a specific thing

 Without a definite passive subject against whom such right may be personally enforced

 Jus in re

 The res of a real right may be

o Personal property (as in pledge and chattel mortgage) o Real property (easement, real mortgage)

o Either personal or real (as in ownership, possession, usufruct)

 If the res of a real right is real property, the right itself is real property; otherwise it is personal property

Classification of real rights based upon dominion

1. Domino pleno – powers to enjoy and to dispose are united

a. Dominion, civil possession, hereditary right

2. Domino menos pleno – powers to enjoy and dispose are separated

a. Surface right, usufruct

3. Domino limitado – powers to enjoy and to dispose, though united, are

limited

a. By a guaranty (mortgage, pledge) b. By a charge (easement)

c. By a privilege (pre-emption, redemption) What is a personal right?

 Right or power of a person

 To demand from another as a definite subject

 The fulfillment of the latter’s obligation.

 Jus in personam or jus ad rem

 Personal right, or right of obligation, has the following elements: 1. Active subject (person in whom the right resides)

3. Object or prestation or the conduct (to give, to do, or not to do) 4. Juridical or legal tie which binds the parties to the obligation

Real Right

 Definite active subject who has a right against all persons generally as an indefinite passive subject

 Object is generally a corporeal thing

 Created by ‘mode’ and

‘title’

 Extinguished by the loss or destruction of the thing which it is exercised

 Directed against the whole world (actio in rem against 3rd _persons)

Personal Right

 Definite active subject and a definite passive subject

 Object always an incorporeal thing

 Created by ‘title’

 Personal right survives the subject matter

 Directed against a particular person (actio in personam)

What’s the importance of the classification into movables or immovables?

 In private international law, general rule is that immovables are governed by the law of the country in which they are located, whereas movables are governed by the personal law of the owner which in cases is the law of his nationality or his domicile

 In criminal law, usurpation of property can take place only with real property. On the other hand, robbery and theft can be committed only against personal property

 In procedural law, actions concerning real property are brought in the RTC where the property is located, whereas actions involving personal property are brought in the court where either the defendant or plaintiff resides.

o Forcible entry and unlawful detainer for REAL property o Replevin or manual delivery for PERSONAL

 In contracts, only real property can be the subject matter of real mortgage and antichresis, while only personal property can be the subject matter of mutuum, voluntary deposit, pledge

 In order that the donation of an immovable may be valid, it must be made in a public instrument. For movables, may be oral or in writing (if more than P5000, need only to be in a private instrument)

 For prescription (4 and 8 years for movables; 10 and 30 years for immovables)

 Transactions involving real property must be recorded in the Registry of property to affect 3rd _{parties. Not required with personal property, except}

for chattel mortgage cases.

Art 415 The following are immovable property:

1. Land, buildings, roads, and constructions of all kinds adhered to the soil;

2. Trees, plants, and growing fruits, while they are attached to the land or form an integral part of an immovable;

3. Everything attached to an immovable in a fixed manner, in such a way that it cannot be separated therefrom without breaking the material or deterioration of the object;

4. Statues, reliefs, paintings or other objects for use or

ornamentation, placed in buildings or on lands by the owner of the immovable in such a manner that it reveals the intention to attach them permanently to the tenements;

5. Machinery, receptacles, instruments or implements intended by the owner of the tenement for an industry or works which may be carried on ina building or on a piece of land, and which tend directly to meet the needs of said industry or works;

6. Animal houses, pigeon-houses, beehives, fish ponds or breeding places of similar nature, in cases their owner has placed htem or preserves them with the intention to have them permanently attached to the land, and forming a permanent part of it; the animals in these places are included;

7. Fertilizer actually used on a piece of land;

8. Mines, quarries, and slag dumps, while the matter thereof forms part of the bed, and waters either running or stagnant;

9. Docks and structures which, though floating, are intended by their nature and object to remain at a fixed place on a river, lake, or coast;

10. Contracts for public works, and servitudes and other real rights over immovable property.

Classes of immovable or real property (NIDA) 1. By nature (cannot be carried from place to place)

2. By incorporation (attached to an immovable in a fixed manner to be an integral part thereof)

4. By analogy (by express provision of law because it is regarded as united to the immovable property)

Lands, buildings, roads and constructions of all kinds

 Must adhere to the soil

 Buildings must be more or less of a permanent structure independent of and regardless of the ownership of the land on which it is erected since the law makes no distinction (so possible to mortgage building even if in the land of another, since it’s separate from the land

 Roads, whether public or private, are immovable

 Real property treated by the parties as personal property

o A building is by itself an immovable property irrespective of whether or not said structure and the land on which it is adhere to belong to the same owner

o A valid real estate mortgate can be constituted only on the building erected on the land belonging to another

o The parties to a contract of chattel mortgage may, by agreement, treat as personal property that which by nature would be real property (estopped! So they can be subject to a writ of replevin between parties)

 However, the chattel mortgage is not binding on third persons.

Trees, plants and growing fruits

 Immovable while they are: o Attached to the land, or

o Form an integral part of an immovable

 Once cut or uprooted, they become movable

 Growing crops or fruits, or ungathered products or fruits, may be treated as personal property for the purposes of attachment, execution and the chattel mortgage law (Sibal v Valdez)

 When growing crops are sold and before they are even harvested, the transaction is considered as sale of movables because it is a given that they are to be gathered or harvested for delivery

Everything attached to an immovable in a fixed manner

 Attachment must be such that

o It cannot be separated from the immovable o Without breaking the material, or

o Deterioration of the object

 If temporarily separated, will still be regarded as immovable if there is an intent to put them back (but there are different opinions to this)

 Intent to attach permanently is essential – objects placed by humans with intention to permanent annexation lose their identity as movables Statues, reliefs, paintings, or other objects for use or ornamentation

 Immovable when:

o Placed on the immovable by the owner of the latter, and o In such a manner that it reveals the intention to attach them

permanently to the tenements

 Not necessarily by him personally, can be by his agent

 If placed by a person not the owner like a lessee, the object will not attain the character of immovable unless such person acts as an agent of the owner

Machinery, receptacles, instruments, or implements for an industry or works

 Immovable only when:

o Placed by the owner of the tenement or his agent

o Industry or works must be carried on in a building or on a piece of land

o Machinery, etc must tend directly to meet the needs of the said industry or works

 Machinery which is movable in its nature only becomes immobilized when placed in plant by the owner of the property or plant, but not when so placed by a tenant, a usufructuary, or any person having only a temporary right (Davao Saw Mill v Castillo)

o Exception (becomes immovable):

1. Such person acted as the agent of the owner, or

2. Lease agreement states that the machines will pass over to the lessor after the expiration of the lease agreement (US

Valdez case)

 Must be essential and be principal elements of an industry or works to the business, not merely incidental to business (Mindanao Bus

Company v City Assessor)

o Cash registers, typewriters for hotels, restaurants, theaters are merely incidental, these businesses can continue on without them

o Machineries of breweries used in the manufacture of liquor, though movable by nature, are immobilized because they are essential to said industries

 For purposes of taxation, it doesn’t matter who placed the machines – the owner or mere lessee, as long as it is essential and principal elements of an industry. The term ‘real property’ may include things which should generally as personal property. It is a familiar

phenomenon to see things classified as real property for purposes of taxation which on general principle might be considered personal property. (Meralco v Central Board of Assessment Appeals – in this

case, the storage tanks were placed by Meralco, who wasn’t the owner of the land, but it was still considered immovable)

 Attachment or incorporation to immovable not essential, since they become immovable because of destination, what is essential is their utility

Animal houses, pigeon houses, beehives, fish ponds or breeding places of similar nature

 Considered immovable:

o In case their owner has placed them or preserves them o With the intention to have them permanently attached to the

land

o And forming a permanent part of it. o The animals in these places are included.

 Must permanently form part of the land and so intended by the owner Fertilizers actually used on a piece of land

 Immovable when

o Actually used on a piece of land

 Fertilizers kept in a barn are not immovable Mines, quarries and slag dumps

 Immovable when

o While the matter thereof forms part of the bed

o Meaning, the matter thereof remains unsevered from the soil

 Waters, either running or stagnant, are classified as immovables Docks and structures, though floating

 Immovable if

o Intended by their nature and object o To remain at a fixed place on o A river, lake or coasts

Contracts for public works and servitudes and other real rights over immovables

 Where the res of a real right is real property, the right itself is real property. So ownership is real property if the thing owned is immovable

o Loan is real property by analogy if secured by a real estate mortgage

 Where it is personal property, the right itself is personal property o Exception: case of contracts for public works which are

considered real property



CHAPTER TWO: MOVABLE PROPERTY

Art 416 The following things are deemed to be personal property: 1. Those movables susceptible of appropriation which are not

included in the preceding article;

2. Real property which by any special provision of law is considered as personalty;

3. Forces of nature which are brought under control by science; and 4. In general, all things which can be transported from place to place

without impairment of the real property to which they are fixed. Art 417 The following are also considered as personal property: 1. Obligations and actions which have for their object movables or demandable sums;

2. Shares of stock of agricultural, commercial and industrial entities, although they may have real estate.

Classes of movable or personal property 1. Property not included in Art 415

2. Considered personal property by special provision of law 3. Forces of nature brought under control by science 4. In general, all movable things

a. Whether the property can be transported or carried from place to place;

b. Whether such change of lacation can be made without injuring the immovable to which the object may be attached, and

c. Whether the object does not fall within any one of the cases in Art 415

5. Obligations and actions (personal rights, they having a definite passive subject)

6. Shares of stock

7. Other incorporeal personal property

a. Intellectual property such as copyrights, patents, etc

Art 418 Movable property is either consumable or non-consumable. To the first class belong those movables which cannot be used in a manner appropriate to their nature without their being consumed; to the second class belong all the others.

Importance of classification:

 Consumable goods cannot be the subject matter of a commodatum (unless for mere exhibition)

 In a mutuum, the subject matter is money or other consumable thing Consumable

 Depends on nature of thing itself

 Can’t be used in a manner appropriate to their nature without being consumed

Fungible

 Depends on the intention or purpose of the parties

 Can be substitute by another thing of the same kind, quantity and quality

 Money, while characterized as a movable, is generic and fungible. (BPI

v Franco)

CHAPTER THREE: PROPERTY IN RELATION TO WHOM IT

BELONGS

Art 419 Property is either of public dominion or of private ownership

Property is either of

1. Public dominion or property owned by the State (or its subdivisions) in its public or sovereign capacity and intended for public use and not for the use of the State as a juridical person

2. Private ownership or property owned by:

a. The state in its private capacity; known as patrimonial property b. Private persons, either individually or collectively

Property is presumed to be State property in the absence of any showing to the contrary. (Regalian Doctrine)

What’s dominion?

1. Not owned by the State but simply under its jurisdiction and

administration for the collective enjoyment of all the people of the State 2. Purpose is to serve the citizens, not the State as juridical person 3. Rises from the fact that the State is the juridical representative of the

social group

Art 420 The following things are property of public dominion:

1. Those intended for public use, such as roads, canals, rivers, torrents, ports and bridges constructed by the States, banks shores, roadsteads and others of similar character

2. Those which belong to the State, without being for public use, and are intended for some public service or for the

development of the national wealth

Three kinds of public dominion property 1. Intended for public use

 Can be used by everybody

2. Not for public use but intended for some specific public service

 Only be used by duly authorized people, such as government buildings, etc

3. Intended for the development of national wealth, even if not employed for public use or service

 Minerals, coal, oil, forests

Charging of fees to the public does not affect the public character of the road or its character as property for public use.

What are other property of similar character to those intended for public use?

1. Public streams, river channels, river beds, etc 2. Accretions to the shores of the sea

3. Submerged lands or lands reclaimed from the sea by the government

 Mere reclamation of certain foreshore land does not convert these inalienable natural resources of the state into alienable or

disposable lands of the public domain.

 There must be a law or proclamation officially classifying them such.

4. Lands that disappeared into the sea

5. Canals constructed on private lands of private ownership but the owner loses his proprietary right over said canal through prescription by allowing the public to use it for transportation

6. Foreshore lands when the sea moved toward an estate and the tide invade it, the invaded property becomes foreshore and passes to the public realm

- Foreshore land is the strip of land that lies between the high and low water marks

7. Lot on which stairways were built for the use of the people as passageway to the highway

 Roads refer to those constructed by the national government

 Canals constructed by private persons over private lands are of private ownership

 Roadstead is a place less sheltered or enclosed than a harbor where ships may ride at anchor

Properties of public dominion are outside of the commerce of man. Again, their purpose is to serve the citizens.

They can not be the object of appropriation either by the State or private persons.

So…

1. Cannot be sold, leased or be the subject of contracts

2. Cannot be acquired by prescription, not even by municipalities as against the State

3. Cannot be encumbered, attached, or be subject to levy and sold at public auction.

4. Cannot be burdened with easements

5. Cannot be registered under the land registration law and be the subject of a Torrens title

 Inclusion of public dominion property does not confer title on the registrant

Public lands v Government lands Public lands

 Lands of the public domain

 Does not include all lands of government ownership but only so much of said lands as are thrown open to private appropriation and settlement by homestead law

Government lands

 Broader term

 Includes not only public lands, but also…

1. other lands of the government already reserved or devoted to public use,

2. or subject to private rights, 3. and patrimonial lands Alienation of public agricultural land

 Unless pubic land is shown to have been reclassified and alienated by the State to a private person, it remains part of the inalienable public domain

 All other lands are presumed to belong to the State

Art 421 All other property of the State, which is not of the character stated in the preceding article, is patrimonial property.

Patrimonial property

 Property of the State owned by it in its private or proprietary character

 Not for public use, service or development of the national wealth

 May be acquired by private individuals or juridical persons through prescription; can be the object of an ordinary contract

Art 422 Property of public dominion, when no longer intended for public use or for public service, shall form part of the patrimonial property of the State.

Property of the National Government

 There must be a formal declaration by the executive (exercised by the President) or possibly legislative department that the property is no longer needed for public use or for public service before the same can be classified as patrimonial property

 A positive act declaring land as alienable and disposable is required 1. Presidential proclamation or executive order

2. Administrative action

3. Investigation reports of Bureau of Lands investigators 4. Legislative act or a statute (Sec of DENR v Yap)

 Classification of public lands is the exclusive prerogative of the Executive Department – courts have no authority (Sec of DENR v Yap)

 Abandonment cannot be inferred from non-use. (Roponggi case)

 Two requisites for judicial confirmation of imperfect or incomplete title, under CA 141

1. open, continuous, exclusive and notorious possession and occupation of the subject land by himself or through his predecessors-in-interest under a bona fide cliam of ownership since time immemorial or from June 12, 1945

2. classification of the land as alienable and disposable land of the public domain (Sec of DENR v Yap)

 Unclassified land? Considered as forest land (Sec of DENR v Yap) Property of Political Subdivisions

 For provinces, cities and municipalities, the conversion must be authorized by law

 Municipal corporation has discretionary power to withdraw a street from public use and sell it. (Cebu Oxygen v Becilles)

Art 423 The property of provinces, cities, and municipalities is divided into property for public use and patrimonial property.

Art 424 Property for public use, in the provinces, cities, and

municipalities, consist of the provincial roads, city streets, municipal streets, the squares, fountains, public waters, promenades, and public works for public service paid for by said provinces, cities or

municipalities.

All other property possessed by any of them is patrimonial and shall be governed by this Code, without prejudice to the provisions of special laws.

Property of Political Subdivisions

 Note that the articles speak of property for public use, indicating that properties for public service are patrimonial. (ambulance of the local government)

 Political subdivisions cannot register as their own any part of the public domain, unless it is first shown that a grant thereof has been made or possession has been enjoyed during the period necessary to establish a presumption of ownership.

 If the property is owned by the municipality in its public and governmental capacity, the property is public and Congress has

absolute control over it.

 If it is owned in its private or proprietary capacity, then it is patrimonial and Congress has no control over it. (page 63, de Leon)

Case doctrines:

 The use of subdivision roads by the general public does not strip it of its private character.

 Transfer of ownership from the subdivision owner-developer to the local government is not automatic but requires a positive act from the owner-developer before the city or municipality can acquire dominion over the subdivision roads. Until and unless the roads are donated, ownership remains with the owner-developer. (Woodridge School, Inc v ARB

Construction Co, Inc)

Art 425 Property of private ownership, besides the patrimonial property of the State, provinces, cities, and municipalities, consists of all property belonging to private persons, either individually or collectively.

Private property

1. Belonging to private persons, either individually or collectively

2. Belonging to the State and any of its subdivisions which are patrimonial in nature

 There is nothing that will prohibit churches from alienating things classified into ‘sacred, religious, and holy.’

Art 426 Whenever by provision of law, or an individual declaration, the expression “immovable things or property” or “movable things or

property” is used, it shall be deemed to include, respectively, the things enumerated in Chapter 1 and Chapter 2.

Whenever the word “muebles” or “furniture,” is used alone, it shall not be deemed to include money, credits, commercial securities, stocks and bonds, jewelry, scientific or aristic collections, books, medals, arms, clothing, horses or carriages and their accessories, grains, liquids and merchandise, or other thing which do no have as their principal object the furnishing or ornamenting of a building, except where from the context of the law, or of the individual declaration, the contrary clearly appears.

TITLE II – OWNERSHIP

CHAPTER ONE: OWNERSHIP IN GENERAL

Art 427 Ownership may be exercise over things or rights

Ownership is the…

 Independent right of a person to the exclusive enjoyment and control of a thing

 Including its disposition and recovery subject only to the restrictions or limitations established by law and the rights of others

Beneficial Ownership

 Ownership recognized by law and capable of being enforced in court

 Right to enjoyment in one person, legal title is in another Naked Ownership

 Enjoyment of all the benefits and privileges of ownership Ownership may be exercised over things or rights

1. Thing – usually refers to corporeal property

2. Rights – whether real or personal, res of rights may be corporeal or incorporeal

Art 428 The owner has the right to enjoy and dispose of a thing, without other limitations than those established by law.

The owner has also a right of action against the holder and possessor of a thing in order to recover it.

The seven jus-es 1. Possidendi 2. Utendi 3. Fruendi 4. Accessionis 5. Abutendi 6. Disponendi 7. Vindicandi

Right to possess or jus possidendi

 right to hold a thing or enjoy a right (Art 523)

 may be exercised in one’s own name or in that of another 1. Right to use not necessarily included

 May be in the concept of an owner or a mere holder with the ownership pertaining to another

 Right to possess does not always include the right to use 2. Judgment of ownership may not include possession

 Person may be declared owner but he may not be entitled to possession which may be in the hands of another such as a tenant

 But! This doctrine may be invoked only where the actual possessor has some rights which must be respected

3. Where claim to possession based on claim of ownership

 Where the ownership of a property was decided in a judgment, the delivery of possession should be considered included in the decision where the defeated party’s claim to the possession is based on his claim of ownership

4. Duty of vendor to deliver possession of thing sold

 Contract of sale, vendor bound not only to transfer ownership, but also deliver

 Considered delivered only when vendee has control and possession

Right to use and enjoy or jus utendi

 necessarily includes the right to transform and the right to exclude any person from the enjoyment and disposal thereof

 he may use such force as may be reasonably necessary to repel or prevent an actual or threatened unlawful physical invasion or usurpation (Art 429)

 limited because he cannot make use of such property in a manner to injure the rights of a third person

Right to receive the fruits and accessories or jus fruendi and accessionis

 ownership gives the right by accession to everything which is produced thereby (see art 440)

Right to consume or jus abutendi

 right of the owner to consume a thing by its use – the use that extinguishes

Right to dispose or alienate or jus disponendi

 either totally (sale or donation) or partially (pledge, mortgage, etc)

 includes right not to dispose

 duty of vendor to transfer ownership

o vendor must be the owner or authorized to sell thing

o sufficient that he be the owner at the time of the delivery of the thing sold

 only the absolute owner can pledge or mortgage one’s property Right to recover possession and/or ownership or jus vindicandi

 true owner must resort to judicial process for the recovery of the property

 he cannot take the law into his own hands

Actions available to recover possession and/or ownership

1. Recovery of personal property: Remedy of Replevin or manual delivery of personal property

Requisites (Rule 60, Rules of Court):

Applicant must show by his own affidavit or that of some other person who personally knows the facts:

i. That the applicant is the owner of the property claimed, particularly describing it, OR is entitled to the possession thereof

ii. That the property is wrongfully detained by the adverse party, alleging the cause of detention thereof according to the best of his knowledge, information and belief

 Applicant has burden of proving his ownership or right of possession over the property in question

 Both a principal remedy (regain possession) and a provisional remedy (allow the plaintiff to retain the thing wrongfully detained by another pendente lite)

2. Recovery of real property:

Forcible entry and unlawful detainer ( accion interdictal)

 Forcible entry Requisites:

i. Instituted by person deprived of possession

ii. Unlawful deprivation of the possession of any land or building, by force, intimidation, threat, strategy or stealth

iii. Filed within 1 year from date of actual entry (but for cases of stealth and strategy, from date of knowledge of actual knowledge)

iv. At the MTC where property is located

 Unlawful detainer Requisites:

i. Instituted by landlord, vendor, vendee or other person against who the possession of any land or building is unlawfully withheld

ii. Unlawful possession after the expiration or

termination of the right to hold possession (by virtue of contract, etc)

iii. Filed within 1 year from date of last demand to vacate iv. at the MTC where property is located

 For unlawful detainer, it is essential that the plaintiff’s supposed acts of tolerance must have been present right from the start of the possession which is later sought to be recovered (Valdez, jr v CA)

 Only issue involved in both is mere physical or material possession (possession de facto), not juridical or civil possession (possession de

jure)

 Plaintiff need only to allege and prove prior possession de facto and undue deprivation thereof

 It’s a quieting process

 Summary in nature (to solve the problem quickly and to protect the rights of the possessor)

 Difference between the two is the time when possession became unlawful – forcible entry: time of entry; unlawful detainer: possession at first was legal, then became illegal

 If complaint fails to aver facts constitutive of forcible entry or unlawful detainer as when it does not state how entry was effected or how and when the dispossession started, the remedy should either be accion

publiciana or an accion reinvindicatoria (Valdez, jr v CA)

o Must be apparent in the face of the complaint (Sarmiento v CA)

 Jurisdictional facts – what does a plaintiff have to allege? o For unlawful detainer

i. Plaintiff’s right over property (describing the property) ii. Prior lawful possession

i. If by tolerance, acts of tolerance must have been present right from the start of the possession ii. If by lease, contractual agreement must be shown iii. Became unlawful (by termination of lease contract or

non-payment of rents)

iv. Extrajudicial demand to vacate

i. If by non-payment, demand letter to PAY RENTS and VACATE premises (bar question)

v. Within one year from last demand

 Can the MTC rule on the issue of ownership in an ejectment case? Yes! But only provisionally.

 The primal rule is that the principal issue must be that of

possession, and that ownership is merely ancillary, in which case the issue of ownership may be resolved but only for the purpose of determining the issue of possession.

 It must sufficiently appear from the allegations in the complaint that what the plaintiff really and primarily seeks is the restoration of possession.

 Inferior court cannot adjudicate on the nature of ownership where the relationship of lessor and lessee has been sufficiently established in the ejectment case, unless it is sufficiently established that there has been a subsequent change in or termination of the relationship between the parties.

 The rule in forcible entry cases, but not in those for unlawful detainer, is that a party who can prove prior possession can recover such possession even against the owner himself. He has the

security that entitles him to remain on the property until he is lawfully ejected by a person having a better right through an accion

publiciana or accion reinvindicatoria

 Where the question of how has prior possession hinges on the question of who the real owner of the disputed portion is, the inferior court may resolve the issue of ownership and make a declaration as to the owner. But, it is merely provisional, and does not bar nor prejudice an action between the same parties involving the title to the land. (Asis v Asis Vda de Guevarra, 2008)

Plenary action to recover possession ( accion publiciana) Requisites:

i. Must be within a period of ten years otherwise the real right of possession is lost

ii. One who claims to have a better right must prove not only his right but also the identity of the property claimed iii. Filed in the RTC where the property is located

 Issue involved is possession de jure of realty independently of title (as

compared to interdictal, possession de facto)

 Judgment rendered here is conclusive only on the question of possession, not that of ownership

 Jurisdictional facts?

1. Right of plaintiff over property 2. Period to bring interdictal has expired 3. Don’t know na. 

Action to recover possession based on ownership ( accion reivindicatoria) Requisites:

i. Right of plaintiff over property

ii. Filed at the RTC where the property is located

 Seeks recovery of possession based on ownership, with claim of title

 Issue involved is ownership which ordinarily includes possession, although a person may be declared owner but he may not be entitled to possession because the possessor has some rights which must be respected

 Action for reconveyance – prescribes in 10 years from the point of the registration of the deed or the date of issuance of the certificate of title (check book!); 4 years in cases of fraud counted therefrom on date of issuance of the certificate of title over the property

o Action for reconveyance based on fraud and where plaintiff is in possession of the property subject of the acts does not prescribe. (Leyson v Bontuyan)

o NB: Should not have passed to a third person. All three actions are actions in personam.

Injunction as a remedy for recovery of possession

 Injunction is a judicial process whereby a person is required to do or refrain from doing a particular thing.

 General rule: Court should not by means of a preliminary injunction

transfer property in litigation from the possession of one party to another.

 In order that a preliminary injunction may be granted at any time after the commencement of the action and before judgment:

Requisites:

i. there must exist a clear and positive right over the property in question which should be judicially protected through the writ; and

ii. the acts against which the injunction is to be directed are violative of such right

 What if there is someone actually possessing the property sought to recover?

o Person not ordinarily allowed to avail of remedy of preliminary preventive or mandatory injunction but must bring the necessary action for the recovery of possession.

 Injunctive relief will not be granted to take property out of the

possession or control of one party and place it in that of another whose title…

o Has not been clearly established, or

o Who did not have such possession or control at the inception of the case

 Proper function is to maintain the status quo

 Injunction cannot be a substitute for other suits for recovery of possession, hence, its denial will not bar the institution of the more appropriate remedy

 Why? Well, a writ of injunction is an equitable relief; determination of title is a legal remedy – that’s why

When can injunction be allowed?

 In actions for forcible entry, the dispossessed plaintiff may file, within ten days from filing of the complaint, a motion for a writ of preliminary mandatory injunction to restore him in possession.

o The court MAY grant In order to prevent the defendant from committing further acts of dispossession during the pendency of the case

o Issue of ownership may not be put in issue

 Ejectment cases where the appeal is taken, the lessor is given the same remedy granted above.

 Where the actual possessor of the property who is admittedly the owner, seeks protection from repeated or further intrusions into his property.

o Even if it turns out that he isn’t the owner, he may still avail of the equitable remedy of injunction to protect his possession.

 When there is a clear finding of right of ownership and possession of a land in favor of the party who claims the subject property in possession of another is the undisputed owner as where the property is covered by a Torrens title pointing to the party as the owner. (Of course, check the issuance of the title if it was in bad faith)

 When urgency, expediency and necessity require immediate possession as where material and irreparable injury will be done which cannot be compensated by damages.

Writ of possession as a remedy

 Writ of possession is an order whereby a sheriff is commanded to place a person in possession of a real or personal property, such as when a property is extrajudicially foreclosed.

 Improper to eject another from possession, unless sought in connection with a:

1. Land registration proceeding

2. Foreclosure of mortgage, provided, that no third person has intervened (PNB v CA – in this case, a third person was occupying the lot subject to the writ. The SC held that the an ex-parte petition for issuance of a possessory writ is not the

judicial process referred to in Art 433); 3. Execution sales

Limitations on the right of ownership Limited by

2. those imposed by law such as legal easement

3. those imposed by the owner himself, such as voluntary easement

4. those imposed by the grantor of the property on the grantee

5. those arising from conflicts of private rights which take place in

accession continua

6. prohibition against the acquisition of private lands by aliens

Art 429 The owner or lawful possessor of a thing has the right to exclude any person from the enjoyment and disposal thereof. For this purpose, he may use such force as ay be reasonably necessary to repel or prevent an actual or threatened unlawful physical invasion or usurpation of his property.

Principle of self-help Requisites:

i. Person defending must be the owner or lawful possessor

ii. Use of reasonable force

iii. Only be exercised at the time of an actual or threatened dispossession (no delay)

iv. Actual or threatened physical invasion or usurpation which is unlawful

Read with Art 19 of the Civil Code.

Art 430 Every owner may enclose or fence his land or tenements by means of walls, ditches, live or dead hedges, or by any other means without detriment to servitudes constituted thereon.

Right to enclose or fence

 Limited by existing servitudes imposed on the land or tenement

Art 431 The owner of a thing cannot make use thereof in such manner as to injure the rights of a third person.

Art 432 The owner of a thing has no right to prohibit the interference of another with the same, if the interference is necessary to avert an imminent danger and the threatened damage, compared to the damage arising to the owner from the from the interference, is much greater. The owner may demand from the person benefited indemnity for the damage to him.

State of necessity

General rule: a person cannot interfere with the right of ownership of another Exception: State of necessity, but of course, civil indemnification can be asked for

Requisites:

i. interference is necessary to avert an imminent danger and the threatened damage to actor or a third person (but the damage must be proportionate and reasonable)

ii. imminent danger or threatening damage must be much greater than the damage arising to the owner of the property

Art 433 Actual possession under claim of ownership raises a disputable presumption of ownership. The true owner must resort to judicial process for the recovery of the property.

 Applies to both immovable and movable property Requisites to raise the disputable presumption of ownership:

i. Actual (physical or material) possession of the property ii. Possession must be under claim of ownership

Judicial process contemplated

 Means ejectment suit or reinvidicatory action

 Ex-parte petition for issuance of a possessory writ is not a judicial

process, as it is non-litigious (PNB v CA)

Art 434 In an action to recover, the property must be identified, and the plaintiff must rely on the strength of his title and not on the weakness of the defendant’s claim.

Requisites:

i. Person who claims that he has a better right to the property must satisfactorily prove both ownership and identity

ii. Burden of proof lies on the party who substantially asserts the affirmative of an issue

iii. Reliance on strength of evidence and not upon the weakness of the opposing party

 Party who desires to recover must fix the identity of the land claimed by describing the location, area and boundaries thereof

o If a party fails to identify sufficiently and satisfactorily the land which he claims as his own, his action must necessarily fail o While the identity of the property must be established, it is not

necessary for the plaintiff to establish the precise location and extent of the lands claimed or occupied by the defendant

 General rule: where there is a conflict between the area and boundaries of a land, the latter prevails.

o An area delimited by boundaries properly identifies a parcel of land

Exception: where the boundaries relied upon do not identify the land beyond doubt

o In such cases where there appears to be an overlapping of boundaries, the actual size of the property gains importance. Equiponderance of evidence? Rule for defendant.

Evidence to prove ownership 1. A Torrens title

2. Title from the Spanish government

3. Patent duly registered in the Registry of Property 4. Deed of sale

5. Operating a business for nine years in defendant’s own name, without protest of plaintiff

6. Occupation of a building for a long time without payment of rent 7. Letter in which defendant recognized the ownership of the property by

the plaintiff (estoppel)

8. Open, continuous, exclusive, adverse and notorious actual possession and occupation of parcels of land

Indicia of claim of ownership

1. Tax declarations and tax receipts – only prima facie evidence of ownership or possession; but they are good indicia of possession in the concept of owner

Conclusiveness of certificates of title

 Indicates true and legal ownership of a private land and should be accorded great weight as against tax declarations

o but is not conclusive if the land had already been previously registered

Art 435 No person shall be deprived of the property except by competent authority and for public use and always upon payment of just compensation.

Should this requirement be not first complied with, the courts shall protect, and in a proper case, restore the owner in his possession.

Power of eminent domain Requisites:

i. Taking must be done by competent authority ii. Must be for public use

iii. Owner paid just compensation

iv. Requirement of due process of law must be observed

Should the requirements be not first complied with, restore the property to his possession.

 But can be lost by estoppel or acquiescence

Art 436 When any property is condemned or seized by competent authority in the interest of health, safety or security, the owner thereof shall not be entitled to compensation, unless he can show that such condemnation or seizure is unjustified.

Condemnation or seizure of property in exercise of police power

 Relates to use and enjoyment not ownership of property

 No taking of property involved

 Persons affected not entitled to financial compensation

Art 437 The owner of a parcel of land is the owner of its surface and of everything under it, and he can construct thereon any works or make any plantations and excavations which he may deem proper, without detriment to servitudes and subject to special laws and ordinances. He cannot complain of the reasonable requirements of aerial navigation.

Surface rights of a landowner

Right of the owner of a parcel of land to construct any works or make any plantations and excavations on his land is subject to: (SLERRt)

1. Special laws 2. Local ordinances

3. Existing servitudes or easements

4. Reasonable requirements of aerial navigation 5. Rights of third persons

Limitations imposed by special laws

 Includes the regalian doctrine

 Ownership of said land does not give him the right to extract or utilize the said minerals without the permission of the State to which said minerals belong

o For the loss sustained by such owner, he is entitled to just compensation under mining laws or expropriation proceedings

Art 438 Hidden treasure belongs to the owner of the land, building, or other property on which it is found.

Nevertheless, when the discovery is made on the property of another, or of the state or any of its sub-divisions, and by chance, one-half thereof shall be allowed to the finder. If the finder is a trespasser, eh shall not be entitled to any share of the treasure.

If the things found be of interest to science or the arts, the State may acquire them at their just price, which shall be divided in conformity with the rule stated.

Art 439 By treasure is understood, for legal purposes, any hidden and unknown deposit of money, jewelry, or other precious objects, the lawful ownership of which does not appear.

Requisites:

i. Deposit of money, jewelry or other precious objects

ii. Hidden and unknown

iii. Lawful ownership of which does not appear

CHAPTER TWO: RIGHT OF ACCESSION

GENERAL PROVISIONS

SECTION I – RIGHT OF ACCESSION WITH RESPECT TO

WHAT IS PRODUCED BY PROPERTY

Art 440 The ownership of property gives the right by accession to everything which is produced thereby, or which is incorporated or attached thereto, either naturally or artificially.

Accession defined

Accession is the right of the owner of a thing, real or personal, to become the owner of everything which is:

1. produced thereby, 2. incorporated 3. attached thereto, either naturally or artificially.

Accession Accessory

 fruits of, additions to, improvements upon a thing

 includes building, planting and sowing

 alluvion, avulsion, change of course of rivers, formation of islands

 not necessary to the principal thing

 things joined to, included with the principal for the latter’s embellishment, better use or completion

 necessary to principal thing example: key of a house, bow of a violin

Accession, not a mode of acquiring ownership

 Merely a consequence of ownership

 Exercise of the right of ownership

 Since the law itself gives the right, accession may, IN A SENSE, be considered as a mode of acquiring property under the law

Kinds of accession

1. Accession discreta

 Extension of the right of ownership of a person to the products of a thing which belongs to such a person

 Includes natural, industrial, and civil fruits (Art 441)

2. Accession continua

 Extension of the right of ownership to that which is incorporated or attached to a thing which belongs to such person

 May take place:

 With respect to real property

 Accession industrial (building, planting, sowing); or

 Accession natural (alluvion, avulsion, change of river course, and formation of islands)

 With respect to personal property

 Conjunction (attachment, engraftment)

 Commixtion or confusion

 Specification

Art 441 To the owner belongs:

o The natural fruits;

o The industrial fruits;

o The civil fruits.

Art 441 refers to accession discreta Right of owner to the fruits

General rule: All fruits belong to the owner of a thing.

Exception: A person, other than the owner of a property, owns the fruits thereof:

1. possession in good faith by another (possessor entitled to the fruits received before possession is legally interrupted)

2. usufruct (usufructuary entitled to all the fruits of the property on usufruct) 3. lease of rural lands (lessee gets fruits, lessor gets rents)

4. pledge (pledgee gets fruits, etc but with the obligation to compensate what he receives with those which are owing him)

5. antichresis (creditor acquires the fruits of his debtor’s immovable, but with the obligation to apply them first to the interest and then to the principal amount of the credit)

Art 442 Natural fruits are the spontaneous products of the soil, and the young and other products of animals.

Industrial fruits are those produced by lands of any kind through cultivation or labor.

Civil fruits are the rents of buildings, the price of leases of lands and other property and the amount of perpetual or life annuities or other similar income.

Natural fruits Two kinds:

1. Spontaneous products of the soil (not through human cultivation or labor), and

2. Young and other products of animals (chicks, eggs, wool, milk)

 The second kind is considered as natural fruits whatever care or management, scientific or otherwise, may have been given by man since the law makes no distinction.

 Puppies, while cute, bred by a professional breeder are still natural fruits

Industrial fruits

 Those products which are borne through the cultivation or labor of humans

 Usually cultivated for a purpose Civil fruits

1. Rents of buildings

2. Prices of leases (rents) of lands and other property (including movables) 3. Amount of perpetual or life annuities or other similar income

Art 443 He who receives the fruits has the obligation to pay the expenses made by a third person in their production, gathering, and preservation.

Art 443 applies when:

1. Owner of property recovers the property from a possessor and the possessor has not yet received the fruits although they may have already been gathered or harvested; or

2. The possessor has already received the fruits but is ordered to return the same to the owner

In both cases, the owner is obliged to reimburse the previous possessor for the expenses incurred by the latter.

What if the possessor is in bad faith?

 The owner cannot excuse himself from his obligation by alleging bad faith on the part of the possessor because the law makes no distinction When does good faith/bad faith come into play?

 When the goods have yet to be gathered.

 Under 449, a BPS in bad faith has no right of reimbursement for expenses, nor to the fruits. Only for the necessary expenses of preservation of land.

What if the expenses exceed the fruits?

 The owner must pay the expenses just the same because the law makes no distinction

 But keep in mind that the owner only pays for the expenses for production, gathering and preservation – not improvement.

Art 444 Only such as are manifest or born are considered as natural or industrial fruits.

With respect to animals, it is sufficient that they are in the womb of the mother, although unborn.

When natural fruits and industrial fruits deemed to exist

1. Plants which produce only one crop and then perish (rice, corn, sugar): from the time the seedlings appear from the ground

2. Plants and trees which live for years and give periodic fruits (mangoes, oranges, epols): deemed existing until they actually appear on the plants or trees

3. Animals: beginning of the maximum ordinary period of gestation (when there can be no doubt that they are already in the womb of the mum) 4. Fowls: the fact of appearance of chicks should retroact to the beginning

of incubation

SECTION II – RIGHT OF ACCESSION WITH RESPECT TO

IMMOVABLE PROPERTY

Section 2 deals with one kind of accession continua, that of immovables. It comprehends accession industrial (445-456) and accession natural (457-465).

Certain basic principles must be kept in mind: 1. Accession follows the principal

 Owner of the principal acquires the ownership of the accession 2. Incorporation or union must be intimate

 Removal or separation cannot be effected without substantial injury to either or both

3. Effect of good faith and bad faith

 Good faith exonerates a person from punitive liability but bad faith may give rise to dire consequences

 General rule: person who acts in bad faith has no rights

 Exception: person who is in good faith or bad faith is entitled to reimbursement for necessary expenses or preservation (452) as well as expenses for cultivation, gathering and preservation (443) 4. Effect of both parties in bad faith

 Bad faith of one neutralizes bad faith of the other

 Neither party may demand as a matter of right the removal of the improvements against the will of the other for such right is available only to a party in good faith where the other is in bad faith

5. Unjust enrichment

General rule on accession industrial

Art 445 and 446 give the general rule that the accessory follows the principal.

Exception: Art 120 of the Family Code Definitions:

1. Building – generic term for all architectural work with roof built for the purpose of being used as man’s dwelling, or for offices, clubs, theaters, etc.

2. Repairs – putting of something back into the condition in which it was originally in (not an improvement)

Art 445 Whatever is built, planted or sown on the land of another and the improvements or repairs made thereon, belong to the owner of the land, subject to the provisions of the following articles.

 Owner of land must be known for this article to apply

Art 446 All works, sowing, and planting are presumed made by the owner and at his expense, unless the contrary is proved.

Disputable presumptions as to improvements:

1. The works, sowing, and planting were made by the owner. and 2. They were made at the owner’s expense.

He who alleges the contrary of these presumptions has the burden of proof.

Art 447 The owner of the land who makes thereon, personally or through another, paintings, constructions or works with the materials of another, shall pay their value; and if he acted in bad faith, he shall also be obliged to the reparation of damages. The owner of the

materials shall have the right to remove them only incase he can do so without injury to the work constructed, or without the plantings, constructions or works being destroyed. However, if the landowner acted in bad faith, the owner of the materials may remove them in any event, with a right to be indemnified for damages.

Applies when the owner of the property uses the materials of another.

Landowner-Builder/Planter/Sower Owner of Materials

Good faith Good faith

LO-BPS can acquire the materials

provided there is full payment Entitled to full payment for value of materials, or May remove materials provided there is no substantial injury to work done

Bad faith Good faith

Acquire the materials provided he

pays full payment plus damages Entitled to full payment for value of materials plus damages, or Remove materials even if there will be substantial injury to work done plus damages

Good faith Bad faith

Acquire materials without paying for the value thereof and entitled to damages due to defects or inferior quality of materials

Loses materials without indemnity and will be liable for damages due to defects or inferior quality of materials

Bad faith Bad faith

Same as when both are in good faith.

Art 448 The owner of the land on which anything has been built, sown or planted in good faith, shall have the right to 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 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.

Art 449 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. Art 450 The owner of the land on which anything has been built, planted or sown in bad faith may demand the demolition of the work, or that the planting or sowing be removed, in order to replace things in their former condition at the expense of the person who built, planted or sowed; or he may compel the builder or planter to pay the price of the land, and the sower the proper rent.

Art 451 In case of the two preceding articles, the landowner is entitled to damages from the builder, planter or sower.

Art 452 The builder, planter or sower in bad faith is entitled to

reimbursement for the necessary expenses of preservation of the land. Art 453 If there was bad faith, not only on the part of the person who built, planted or sowed on the land of another, but also on the part of the owner of such land, the rights of one and the other shall be the same as though both had acted in bad faith.

It is understood that there is bad faith on the part of the landowner whenever the act was done with his knowledge and without opposition on his part.

Art 454 When the landowner acted in bad faith and the builder, planter or sower proceeded in good faith, the provisions of article 447 shall apply.

What’s good faith? Consists in the:

1. Honest belief that the land he is building, planting, sowing on is his or that by some title, he has a right to build, plant, sow on it; and

2. Ignorance of any defect or flaw in his title

Abrenica definition: State of mind at the time he built the improvements (Pleasantville case)

But the Supreme Court has expanded its coverage to

1. Cases wherein a builder had constructed improvements with the consent of the owner

2. Builders in good faith who relied on the consent of another whom they have mistakenly believed to be the owner of the land

3. To children who built improvement on a land belonging to their parents with their parents consent (Macasaet case)

Landowner Builder/planter/sower

Good faith Good faith

Option 1: Purchase whatever has been built, planted, or sown after paying indemnity which includes necessary, useful and luxurious expenses (if he wishes to

appropriate the luxurious expenses) Prohibited from offsetting or compensating the necessary and useful expense with the fruits received by the BP in good faith (Nuguid case)

Receive indemnity for necessary, useful and luxurious expenses (depends on landowner) with right of retention over the land without obligation to pay rent until full payment of indemnity

Remove useful improvement provided it does not cause any injury (part of right of retention)

If LO does not appropriate luxurious improvements, BPS can remove the same provided there is no injury to the principal thing (land or building) Right of retention only applies when LO chooses to appropriate (but does not apply if property of public dominion)

Option 2: To oblige the BP to buy the land or the S to pay the proper rent unless the value of the land is considerably more than that of the building or trees

Legal implication of planter v sower: Owner can’t compel sower to buy, only rent.

To purchase land at fair market value at time of payment when value is not considerably more than that of the building or trees

To pay rent until the purchase has been made (Technogas case) If BP cannot pay purchase price of the land, LO can require BP to

remove whatever has been built, planted, or sown.

If the value of the land is

considerably more than that of the building or trees, BP cannot be compelled to buy the land. In such case, BP will pay reasonable rent if LO does not choose option 1. If BPS cannot pay the rent, LO can eject BPS from the land.

Note: Rental period of sower is only until he gathers what he sowed. He doesn’t have the remedy of removal. (Sarmiento)

Good faith Bad Faith

Option 1: To acquire whatever has been built, planted or sown without paying indemnity except necessary expenses for preservation of land and luxurious expenses (should LO want to acquire luxurious

improvement) plus damages

Loses whatever has been built, planted or sown without indemnity and liable to pay damages Entitled to reimbursement for necessary expenses for preservation of land but no right to retention (and also 443)

NOT Entitled to reimbursement for useful expenses and cannot remove useful improvements even if removal will not cause injury (MWSS case) Not entitled to luxurious expenses except when LO wants to acquire (value of which will be the one at the time LO enters into possession) Entitled to remove luxurious improvements if it will not cause injury and LO does not want to acquire them. If it will cause injury

and LO doesn’t want to acquire, he gets it for free (Dean Del)

Option 2: To oblige BP to buy land or S to pay proper rent plus damages, regardless of valuation

Obliged to pay for land or proper rent and pay damages

Option 3: To compel BPS to remove or demolish work done plus damages

Obliged to remove or demolish work done at his expense and pay damages

Bad Faith Good Faith

Acquire whatever has been built, planted or sown by paying indemnity plus damages

Ball is in the court of the BPS. BPS can remove whatever has been built, planted or sown regardless of whether or not it will cause injury and will be entitled to damages

If LO acquires whatever has been built, planted or sown, BPS must be indemnified the value thereof plus damages

If LO does not acquire, BPS cannot insist on purchasing land

Bad Faith Bad Faith

Both in good faith Necessary expenses

 Made for the preservation of the thing, or

 Those which seek to prevent the waste, deterioration, or loss of the thing

Useful expenses

 Expenses which add value to a thing or

 Augment is income

When does good faith cease?

 From the moment defects in the title are made known to the possessor by extraneous evidence or by suit for recovery of the property by the true owner

What happens if good faith ceases? (Rosales case)

 LO can acquire improvements built PRIOR to the notice to BPS (when good faith ceased), and indemnify BPS of current market value at time of payment

 LO entitled to rent from the time BPS good faith ceased When will these rules not apply?

1. When other provisions of law govern (agency, co-ownership, lease, usufruct)

2. Improvement constructed on one’s own land subsequently sold (person constructs a house on his own land and later sold land to another)  But, the provision on indemnity in 448 may be applied by analogy

where the owner-builder later lost ownership of the land by virtue of a court judgment, considering that the primary intent of 448 is to avoid a state of forced co-ownership especially where the parties in the main agree that 448 and 546 are applicable and indemnity for the improvements may be paid although they differ as to basis of the indemnity - whut?! (Pecson v CA)

3. Builder is a belligerent occupant

4. Constructions not in the nature of buildings 5. Property of public domain

Art 455 If the materials, plants or seeds belong to a third person who has not acted in bad faith, the owner of the land shall answer

subsidiarily for their value and only in the event that the one who made use of them has no property with which to pay.

This provision shall not apply if the owner makes use of the right granted by Article 450. If the owner of the materials, plants or seeds has been paid by the builder, planter or sower, the latter may demand from the land-owner the value of the materials and labor.

Landowner Builder/Planter/Sower Owner of the Materials

Good Faith Good Faith Good Faith

Option 1: To acquire

built, planted or sown provided there is payment of indemnity (which includes value of what has been built, planter or sown plus value of materials used)

retention over land until full payment

primarily liable for materials; if BPS is insolvent, to proceed against LO who is subsidiarily liable with no right of retention Option 2: To oblige BP

to buy land or S to pay rent unless value of land is considerably more than that of building or trees

To buy land or to pay proper rent

To receive indemnity from BPS only (LO is not subsidiarily liable) with right of retention until full payment; or To remove materials if there will be no injury on building or trees and will have material lien against BPS for payment of materials

Good Faith Good Faith Bad Faith

Same Whatever is the choice

of LO, the OM:

1. loses the materials in favor of the BPS and 2. will have no right to receive indemnity from BPS nor LO

Good Faith Bad Faith Bad Faith

Option 1: To acquire whatever has been built, planted or sown without paying indemnity except for necessary expenses for preservation of land and luxurious expenses (should LO want to acquire luxurious improvements) plus damages

BPS loses what has been built, planted or sown plus liable for damages but is entitled to be indemnified for necessary expenses and luxurious expenses (should LO want to acquire luxurious improvements) and has no right of removal even if removal will not

(Since both BPS and OM are in bad faith, treat them both as if they are in good faith.) Whatever is the choice of the LO, OM has right to receive indemnity for value of materials from BPS only (LO has no subsidiary liability for value of materials

cause damage because OM is

considered in good faith only insofar as BPS is concerned) OM has no right to remove materials even if there will be no injury or damage

Option 2: To oblige BP to buy the land or S to pay proper rent plus damages

To buy the land or pay proper rent and liable to pay damages to LO

Get indemnification from the BPS Option 3: To oblige BP

to demolish or remove what has been built, planted or sown plus damages

To demolish or remove what has been built, planted or sown and liable for damages

Liable to pay damages due to defects or inferior quality of materials

Bad Faith Good Faith Good Faith

To acquire what has been built, planted or sown by paying indemnity plus liable to pay damages

To receive indemnity from LO plus damages

TO receive indemnity of materials principally from BPS and in case BPS is insolvent, subsidiarily from LO

Bad Faith Good Faith Bad Faith

Same Same No right to receive

indemnity for value of materials from BPS nor LO (who ends up owning buildings or trees)

 If OM in bad faith, he doesn’t get anything (unless BPS in bad faith as well)

Art 456 In the cases regulated in the preceding articles, good faith does not necessarily exclude negligence, which gives right to damages under article 2176.

Art 457 To the owners of the lands adjoining the banks of rivers belong the accretion which they gradually receive from the effects of the current of the waters.