Bundle of rights included in Ownership

Property and Lease

Property and Lease

JOVELLANOS vs. CA – 210 SCRA 126 (Art. 1164)

Facts:

Daniel Jovellanos and Philamlife entered into a a lease and conditional sale agreement over a house and lot. At that time, Daniel Jovellanos was married to Leonor Dizon, with whom he had three children, the petitioners.

Leonor Dizon died consequently. Then Daniel married private respondent Annette with whom he begot two children. The daughter from the 1st marriage Mercy Jovellanos married Gil Martinez and at the behest of Daniel Jovellanos, they built a house on the back portion of the premises.

With the lease amounts having been paid, Philamlife executed to Daniel Jovellanos a deed of absolute sale and, on the next day, the latter donated to herein petitioners all his rights, title and interests over the lot and bungalow thereon. In 1985, Daniel died.

Private respondent Annette H. Jovellanos claimed in the lower court that the aforestated property was acquired by her deceased husband while their marriage was still subsisting and which forms part of the conjugal partnership of the second marriage. Petitioners contend that the property, were acquired by their parents during the existence of the first marriage under their lease and conditional sale agreement with Philamlife of September 2, 1955.

Issue:

WON the house and lot pertains to the second marriage? YES

Held:

The conditional sale agreement in said contract is, therefore, also in the nature of a contract to sell, as contradistinguished from a contract of sale. In a contract to sell or a conditional sale, ownership is not transferred upon delivery of the property but upon full payment of the purchase price. Generally, ownership is transferred upon delivery, but even if delivered, the ownership may still be with the seller until full payment of the price is made, if there is stipulation to this effect. The stipulation is usually known as a pactum reservati dominii, or contractual reservation of title, and is common in sales on the installment plan. Compliance with the stipulated payments is a suspensive condition. The failure of which prevents the obligation of the vendor to convey title from acquiring binding force.

Daniel consequently acquired ownership thereof only upon full payment of the said amount hence, although he had been in possession of the premises since September 2, 1955, it was only on January 8, 1975 that Philamlife executed the deed of absolute sale thereof in his favor.

Daniel Jovellanos did not enjoy the full attributes of ownership until the execution of the deed of sale in his favor. The law recognizes in the owner the right to enjoy and dispose of a thing, without other limitations than those established by law, 19 and, under the contract, Daniel Jovellanos evidently did not possess or enjoy such rights of ownership.

Upon the execution of said deed of absolute sale, full ownership was vested in Daniel Jovellanos. Since. as early as 1967, he was already married to Annette H. Jovellanos, this property necessarily belonged to his conjugal partnership with his said second wife.

NB: But since it pertained to the second wife, she is still liable to pay the corresponding reimbursements to the petitioners who helped pay for the amortization of the house and lot. Remember Article 118 of the Family Code on property bought on installments, where ownership is vested during the marriage, such property shall belong to the conjugal partnership.

Garcia vs. Court of Appeals – G.R. No. 133140, August 10, 1999

Doctrine: Possession and ownership are distinct legal concepts. Ownership exists when a thing pertaining to one person is completely subjected to his will in a manner not prohibited by law and consistent with the rights of others. Ownership confers certain rights to the owner, one of which is the right to dispose of the thing by way of sale.
Literally, to possess means to actually and physically occupy a thing with or without right. 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.

Facts: Atty. Pedro V. Garcia, in whose name TCT No. S-31269 covering a parcel of land identified as Lot 17 situated at Bel Air II Village, Makati, was registered, sold with the consent of his wife Remedios T. Garcia, the same to their daughter Ma. Luisa Magpayo and her husband Luisito Magpayo (the Magpayos). On March 5, 1981, the Magpayos mortgaged the land to the Philippine Bank of Communications (PBCom) to secure a loan. On March 9, 1981, Atty. Garcia’s Title was cancelled and in its stead Transfer Certificate of Title No. S-108412/545 was issued in the name of the Magpayos. The Deed of Real Estate Mortgage was registered at the Makati Register of Deeds and annotated on the Magpayos title. The redemption period of the foreclosed mortgage expired without the Magpayos redeeming the same, hence, title over the land was consolidated in favor of PBCom which cancelled the Magpayo’s title and Transfer Certificate of Title No. 138233 was issued in its name. The Magpayos failed to pay their loan upon its maturity, hence, the mortgage was extrajudicially foreclosed and at the public auction sale, PBCom which was the highest bidder bought the land. On October 4, 1985, the Magpayos filed at the RTC of Makati a complaint seeking the nullification of the extrajudicial foreclosure of mortgage, public auction sale, and PBCom’s title docketed as Civil Case No. 11891. This complaint was dismissed for failure to prosecute. On October 15, 1985, PBCom filed at the Regional Trial Court (RTC) of Makati a petition for the issuance of a writ of possession over the land which was granted. Upon service of the writ of possession, Mrs. Magpayo’s brother, Jose Ma. T. Garcia (Garcia), who was in possession of the land, refused to honor it and filed a motion for Intervention in the above-said PBCom petition, which motion was denied.

Garcia thereupon filed against PBCom, the Magpayos, and the RTC Sheriff the instant suit for recovery of realty and damages wherein he alleged, inter alia, that he inherited the land as one of the heirs of his mother Remedios T. Garcia, and that PBCom acquired no right thereover. In its summary judgment, the lower court held that the mortgage executed by the Magpayo spouses in favor of PBCom was void. The Magpayo spouses could not have acquired the said property merely by the execution of the Deed of Sale because the property was in the possession of the plaintiff. The vendor, Pedro V. Garcia, was not in possession and hence could not deliver the property merely by the execution of the document.

On appeal, CA held that Garcia’s assertion that ownership over the disputed property was not transmitted to his sister and her husband-Magpayo spouses at the time of the execution of the Deed of Sale as he was still in actual and adverse possession thereof does not lie. Since the execution of the deed of sale by Atty. Pedro V. Garcia in favor of the Magpayos took place earlier or on August 1, 1980, then contrary to his claim, Garcia was not in possession of the property at the time of the execution of said public instrument. Furthermore, it appearing that the vendor Atty. Garcia had control of the property which was registered in his name and that the deed of sale was likewise registered, then the sale was consummated and the Magpayos were free to exercise the attributes of ownership including the right to mortgage the land.

When the land is registered in the vendor’s name, and the public instrument of sale is also registered, the sale may be considered consummated and the buyer may exercise the actions of an owner. That the Magpayos’ title, TCT No. S-108412, was issued four (4) days following the execution of the deed of real estate mortgage is of no moment, for registration under the Torrens system does not vest ownership but is intended merely to confirm and register the title which one may already have on the land.

Issue: Whether Garcia’s possession is in a concept of an owner.

Held: No. Garcia’s possession which started only in 1986 could not ripen into ownership. He has no valid title thereto. His possession in fact was that of an intruder, one done in bad faith (to defeat PBCom’s Writ of Possession). His possession is certainly not in the concept of an owner. This is so because as early as 1981, title thereto was registered in the name of the Magpayo Spouses which title was subsequently cancelled when the property was purchased by PBCom in a public auction sale resulting in the issuance of title in favor of the latter in 1985.

The Court stressed that possession and ownership are distinct legal concepts. Ownership exists when a thing pertaining to one person is completely subjected to his will in a manner not prohibited by law and consistent with the rights of others. Ownership confers certain rights to the owner, one of which is the right to dispose of the thing by way of sale. Atty. Pedro Garcia and his wife Remedios exercised their right to dispose of what they owned when they sold the subject property to the Magpayo spouses. On the other hand, possession is defined as the holding of a thing or the enjoyment of a right. Literally, to possess means to actually and physically occupy a thing with or without right. 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.

The records show that petitioner occupied the property not in the concept of an owner for his stay was merely tolerated by his parents. Consequently, it is of no moment that petitioner was in possession of the property at the time of the sale to the Magpayo spouses. It was not a hindrance to a valid transfer of ownership. On the other hand, petitioner’s subsequent claim of ownership as successor to his mother’s share in the conjugal asset is belied by the fact that the property was not included in the inventory of the estate submitted by his father to the intestate court. This buttresses the ruling that indeed the property was no longer considered owned by petitioner’s parents.

The Court upheld the Court of Appeals in holding that the mortgage to PBCom by the Magpayo spouses is valid notwithstanding that the transfer certificate of title over the property was issued to them after the mortgage contract was entered into. Registration does not confer ownership, it is merely evidence of such ownership over a particular property. The deed of sale operates as a formal or symbolic delivery of the property sold and authorizes the buyer to use the document as proof of ownership. All said, the Magpayo spouses were already the owners when they mortgaged the property to PBCom.

Digest by: 2S, San Beda Law 2010-2011

Halili vs. Court of Appeals, 287 SCRA 465 , March 12, 1998

Remedial Law; Appeals; Basic and long-settled is the doctrine that findings of fact of a trial judge, when affirmed by the Court of Appeals are binding upon the Supreme Court; Exceptions.—Whether the land in dispute is rural or urban is a factual question which, as a rule, is not reviewable by this Court. Basic and long-settled is the doctrine that findings of fact of a trial judge, when affirmed by the Court of Appeals, are binding upon the Supreme Court. This admits of only a few exceptions, such as when the findings are grounded entirely on speculation, surmises or conjectures; when an inference made by the appellate court from its factual findings is manifestly mistaken, absurd or impossible; when there is grave abuse of discretion in the appreciation of facts; when the findings of the appellate court go beyond the issues of the case, run contrary to the admissions of the parties to the case or fail to notice certain relevant facts which, if properly considered, will justify a different conclusion; when there is a misappreciation of facts; when the findings of fact are conclusions without mention of the specific evidence on which they are based, are premised on the absence of evidence or are contradicted by evidence on record.

Constitutional Law; Property; Jurisprudence is consistent that “if land is invalidly transferred to an alien who subsequently becomes a citizen or transfers it to a citizen, the flaw in the original transaction is considered cured and the title of the transferee is rendered valid.”—In fine, non-Filipinos cannot acquire or hold title to private lands or to lands of the public domain, except only by way of legal succession. But what is the effect of a subsequent sale by the disqualified alien vendee to a qualified Filipino citizen? This is not a novel question. Jurisprudence is consistent that “if land is invalidly transferred to an alien who subsequently becomes a citizen or transfers it to a citizen, the flaw in the original transaction is considered cured and the title of the transferee is rendered valid.”

Army and Navy Club of Manila, Inc. vs. Court of Appeals, 271 SCRA 36 , April 08, 1997

Actions; Ejectment; Illegal Detainer; For violations of the lease contract and after several demands, the lessor has no other recourse but to file an action for illegal detainer and demand the lessee’s eviction from the premises.—Petitioner failed to pay the rents for seven (7) consecutive years. As of October, 1989 when the action was filed, rental arrears ballooned to P7.2 million. Real estate taxes on the land accumulated to P6,551,408.28 as of May, 1971. Moreover, petitioner failed to erect a multi-storey hotel in the site. For violations of the lease contract and after several demands, the City of Manila had no other recourse but to file the action for illegal detainer and demand petitioner’s eviction from the premises.

National Patrimony; Historical Markers; Statutes; R.A. 4846; Due Process; When the classification of property into historical treasures or landmarks will involve the imposition of limits on ownership, the Bill of Rights demands that it be done with due process both substantive and procedural.—While the declaration that it is a historical landmark is not objectionable, the recognition is, however, specious. We take the occasion to elucidate on the views of Fr. Joaquin Bernas who was invited as amicus curiae in the recent case of Manila Prince Hotel v. GSIS where the historical character of Manila Hotel was also dealt with. He stated that: The country’s artistic and historic wealth is therefore a proper subject for the exercise of police power:” . . . which the State may regulate.” This is a function of the legislature. And once regulation comes in, due process also comes into play. When the classification of property into historical treasures or landmarks will involve the imposition of limits on ownership, the Bill of Rights demands that it be done with due process both substantive and procedural. In recognition of this constitutional principle, the State in fact has promulgated laws, both general and special, on the subject. x x x the current general law on the subject is R.A. 4846, approved on June 18, 1966, and amended by P.D. No. 374.

Nowhere in R.A. 4846 does it state that the recognition of a historical landmark grants possessory right over the property to a lessee, and neither is the National Historical Commission given the authority to vest such right of ownership or possession of a private property to another.—It behooves us to think why the declaration was conferred only in 1992, three (3) years after the action for ejectment was instituted. We can only surmise that this was merely an afterthought, an attempt to thwart any legal action taken against the petitioner. Nonetheless, such certification does not give any authority to the petitioner to lay claim of ownership, or any right over the subject property. Nowhere in the law does it state that such recognition grants possessory rights over the property to the petitioner. Nor is the National Historical Commission given the authority to vest such right of ownership or possession of a private property to the petitioner. The law merely states that it shall be the policy of state to preserve and protect the important cultural properties and National Cultural Treasures of the nation and to safeguard their intrinsic value. In line with this, any restoration, reconstruction or preservation of historical buildings shall only be made under the supervision of the Director of the National Museum. The authority of the National Historical Commission is limited only to the supervision of any reconstruction, restoration or preservation of the architectural design of the identified historical building and nothing more.

Even if the recognition of the Army and Navy Club as a historical landmark made by the National Historical Commission is valid, the historical significance of the Club, if any, shall not be affected if the lessee’s eviction from the premises is warranted.—Even assuming that such recognition made by the National Historical Commission is valid, the historical significance of the Club, if any, shall not be affected if petitioner’s eviction from the premises is warranted. Unfortunately, petitioner is merely a lessee of the property. By virtue of the lease contract, petitioner had obligations to fulfill. Petitioner can not just hide behind some recognition bestowed upon it in order to escape from its obligation or remain in possession. It violated the terms and conditions of the lease contract. Thus, petitioner’s eviction from the premises is inevitable.

Andamo vs. Intermediate Appellate Court – G.R. No. 74761 November 6, 1990

Doctrine: It must be stressed that the use of one’s property is not without limitations. Article 431 of the Civil Code provides that “the owner of a thing cannot make use thereof in such a manner as to injure the rights of a third person.” SIC UTERE TUO UT ALIENUM NON LAEDAS.

Facts: Petitioner spouses Andamo owned a parcel of land situated in Biga Silang, Cavite which is adjacent to that of private respondent corporation, Missionaries of Our lady of La Salette, Inc. Within the land of the latter, waterpaths and contrivances, including an artificial lake, were constructed, which allegedly inundated and eroded petitioner’s land, caused a young man to drown, damagaed petitioner’s crops and plants, washed away costly fences, endangered the livesofthepetitioners and their laborers and some other destructions.
This prompted petitioner spouses to file a criminal action for destruction by means of inundation under Article 324 of the RPC and a civil action for damages.

Issue: Whether  petitioner spouses Andamo can claim damages for destruction caused by respondent’s waterpaths and contrivances on the basis of Articles 2176 and 2177 of the Civil Code on quasi-delicts.

Held: Yes. A careful examination of the aforequoted complaint shows that the civil action is one under Articles 2176 and 2177 of the Civil Code on quasi-delicts. All the elements of a quasi-delict are present, to wit: (a) damages suffered by the plaintiff, (b) fault or negligence of the defendant, or some other person for whose acts he must respond; and (c) the connection of cause and effect between the fault or negligence of the defendant and the damages incurred by the plaintiff. 11

Clearly, from petitioner’s complaint, the waterpaths and contrivances built by respondent corporation are alleged to have inundated the land of petitioners. There is therefore, an assertion of a causal connection between the act of building these waterpaths and the damage sustained by petitioners. Such action if proven constitutes fault or negligence which may be the basis for the recovery of damages.

It must be stressed that the use of one’s property is not without limitations. Article 431 of the Civil Code provides that “the owner of a thing cannot make use thereof in such a manner as to injure the rights of a third person.” SIC UTERE TUO UT ALIENUM NON LAEDAS. Moreover, adjoining landowners have mutual and reciprocal duties which require that each must use his own land in a reasonable manner so as not to infringe upon the rights and interests of others. Although we recognize the right of an owner to build structures on his land, such structures must be so constructed and maintained using all reasonable care so that they cannot be dangerous to adjoining landowners and can withstand the usual and expected forces of nature. If the structures cause injury or damage to an adjoining landowner or a third person, the latter can claim indemnification for the injury or damage suffered.

Digest by: 2S, San Beda Law 2010-2011

Republic of the Philippines, Benguet & Atok vs. Court of Appeals & De La Rosa – G.R. No. L-43938, April 15, 1988

Doctrine: The owner of a piece of land has rights not only to its surface but also to everything underneath and the airspace above it up to a reasonable height. The rights over the land are indivisible and the land itself cannot be half agricultural and half mineral. The classification must be categorical; the land must be either completely mineral or completely agricultural.

Facts: These cases arose from the application for registration of a parcel of land filed on February 11, 1965, by Jose de la Rosa on his own behalf and on behalf of his three children, Victoria, Benjamin and Eduardo. The land, situated in Tuding, Itogon, Benguet Province, was divided into 9 lots and covered by plan Psu-225009. According to the application, Lots 1-5 were sold to Jose de la Rosa and Lots 6-9 to his children by Mamaya Balbalio and Jaime Alberto, respectively, in 1964.
The application was separately opposed by Benguet Consolidated, Inc. as to Lots 1-5, Atok Big Wedge Corporation, as to Portions of Lots 1-5 and all of Lots 6-9, and by the Republic of the Philippines, through the Bureau of Forestry Development, as to lots 1-9.

In support of the application, both Balbalio and Alberto testified that they had acquired the subject land by virtue of prescription Balbalio claimed to have received Lots 1-5 from her father shortly after the Liberation.

Benguet opposed on the ground that the June Bug mineral claim covering Lots 1-5 was sold to it on September 22, 1934, by the successors-in-interest of James Kelly, who located the claim in September 1909 and recorded it on October 14, 1909. From the date of its purchase, Benguet had been in actual, continuous and exclusive possession of the land in concept of owner, as evidenced by its construction of adits, its affidavits of annual assessment, its geological mappings, geological samplings and trench side cuts, and its payment of taxes on the land.

For its part, Atok alleged that a portion of Lots 1-5 and all of Lots 6-9 were covered by the Emma and Fredia mineral claims located by Harrison and Reynolds on December 25, 1930, and recorded on January 2, 1931, in the office of the mining recorder of Baguio. These claims were purchased from these locators on November 2, 1931, by Atok, which has since then been in open, continuous and exclusive possession of the said lots as evidenced by its annual assessment work on the claims, such as the boring of tunnels, and its payment of annual taxes thereon.

The Bureau of Forestry Development also interposed its objection, arguing that the land sought to be registered was covered by the Central Cordillera Forest Reserve under Proclamation No. 217 dated February 16, 1929. Moreover, by reason of its nature, it was not subject to alienation under the Constitutions of 1935 and 1973.

The trial court denied the application, holding that the applicants had failed to prove their claim of possession and ownership of the land sought to be registered.

The applicants appealed to the respondent court, which reversed the trial court and recognized the claims of the applicant, but subject to the rights of Benguet and Atok respecting their mining claims. In other words, the Court of Appeals affirmed the surface rights of the de la Rosas over the land while at the same time reserving the sub-surface rights of Benguet and Atok by virtue of their mining claims. Both Benguet and Atok have appealed to this Court, invoking their superior right of ownership.

Issue: Whether respondent court’s decision, i.e. “the surface rights of the de la Rosas over the land while at the same time reserving the sub-surface rights of Benguet and Atok by virtue of their mining claim,” is correct.

Held: No. Our holding is that Benguet and Atok have exclusive rights to the property in question by virtue of their respective mining claims which they validly acquired before the Constitution of 1935 prohibited the alienation of all lands of the public domain except agricultural lands, subject to vested rights existing at the time of its adoption. The land was not and could not have been transferred to the private respondents by virtue of acquisitive prescription, nor could its use be shared simultaneously by them and the mining companies for agricultural and mineral purposes. It is true that the subject property was considered forest land and included in the Central Cordillera Forest Reserve, but this did not impair the rights already vested in Benguet and Atok at that time. Such rights were not affected either by the stricture in the Commonwealth Constitution against the alienation of all lands of the public domain except those agricultural in nature for this was made subject to existing rights. The perfection of the mining claim converted the property to mineral land and under the laws then in force removed it from the public domain. By such act, the locators acquired exclusive rights over the land, against even the government, without need of any further act such as the purchase of the land or the obtention of a patent over it. As the land had become the private property of the locators, they had the right to transfer the same, as they did, to Benguet and Atok. The Court of Appeals justified this by saying there is “no conflict of interest” between the owners of the surface rights and the owners of the sub-surface rights. This is rather doctrine, for it is a well-known principle that the owner of piece of land has rights not only to its surface but also to everything underneath and the airspace above it up to a reasonable height. Under the aforesaid ruling, the land is classified as mineral underneath and agricultural on the surface, subject to separate claims of title. This is also difficult to understand, especially in its practical application.

The Court feels that the rights over the land are indivisible and that the land itself cannot be half agricultural and half mineral. The classification must be categorical; the land must be either completely mineral or completely agricultural. In the instant case, as already observed, the land which was originally classified as forest land ceased to be so and became mineral — and completely mineral — once the mining claims were perfected. As long as mining operations were being undertaken thereon, or underneath, it did not cease to be so and become agricultural, even if only partly so, because it was enclosed with a fence and was cultivated by those who were unlawfully occupying the surface.

This is an application of the Regalian doctrine which, as its name implies, is intended for the benefit of the State, not of private persons. The rule simply reserves to the State all minerals that may be found in public and even private land devoted to “agricultural, industrial, commercial, residential or (for) any purpose other than mining.” Thus, if a person is the owner of agricultural land in which minerals are discovered, his ownership of such land does not give him the right to extract or utilize the said minerals without the permission of the State to which such minerals belong.

The flaw in the reasoning of the respondent court is in supposing that the rights over the land could be used for both mining and non-mining purposes simultaneously. The correct interpretation is that once minerals are discovered in the land, whatever the use to which it is being devoted at the time, such use may be discontinued by the State to enable it to extract the minerals therein in the exercise of its sovereign prerogative. The land is thus converted to mineral land and may not be used by any private party, including the registered owner thereof, for any other purpose that will impede the mining operations to be undertaken therein, For the loss sustained by such owner, he is of course entitled to just compensation under the Mining Laws or in appropriate expropriation proceedings.

Digest by: 2S, San Beda Law 2010-2011

Source: Escra + Breaking Omerta + Scribd + Civil Code, Volume II – Paras

2 responses to “Bundle of rights included in Ownership

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