Bar Q and A #18

1.) Bartolome constructed a chapel on the land of Eric. What are his right if he were: a. A possessor of the land in good faith? b. A possessor of the land in bad faith?

1) A chapel is a useful improvement. Bartolome may remove the chapel if it can be removed without damage to the land, unless Eric chooses to acquire the chapel. In the latter case, Bartolome has the right to the reimbursement of the value of the chapel with right of retention until he is reimbursed. (Art. 448 in relation to Art. 546 and 547, NCC)

2) Bartolome, under Art. 449 of the NCC, loses whatever he built, without any right to indemnity.

2.) a) Because of confusion as to the boundaries of the adjoining lots that they bought from the same subdivision company, X constructed a house on the adjoining lot of Y in the honest belief that it is the land that he bought from the subdivision company. What are the respective rights of X and Y with respect to X's house? b) Suppose X was in good faith but Y knew that X was constructing on his (Y's) land but simply kept quiet about it, thinking perhaps that he could get X's house later. What are the respective rights of the parties over X's house in this case?

a) The rights of Y, as owner of the lot, and of X, as builder of a house thereon, are governed by Art. 448 of the Civil Code which grants to Y the right to choose between two remedies: (a) appropriate the house by indemnifying X for its value plus whatever necessary expenses the latter may have incurred for the preservation of the land, or
(b) compel X to buy the land if the price of the land is not considerably more than the value of the house. If it is, then X cannot be obliged to buy the land, but he shall pay reasonable rent, and in case of disagreement, the court shall fix the terms of the lease.

b) Since the lot owner Y is deemed to be in bad faith (Art. 453), X as the party in good faith may (a) remove the house and demand indemnification for damages suffered by him, or (b) demand payment of the value of the house plus reparation for damages (Art. 447, in relation to Art 454). Y continues as owner of the lot and becomes, under the second option, owner of the house as well, after he pays the sums demanded.

3.) In good faith, Pedro constructed a five- door commercial building on the land of Pablo who was also in good faith. When Pablo discovered the construction, he opted to appropriate the building by paying Pedro the cost thereof. However, Pedro insists that he should be paid the current market value of the building, which was much higher because of inflation. (2000 Bar) 1) Who is correct Pedro orPablo? 2) In the meantime, that Pedro is not yet paid, who is entitled to the rentals of the building, Pedro or Pablo?

1. Pablo is correct. Under Article 448 of the New Civil Code in relation to Article 546, the builder in good faith is entitled to a refund of the necessary and useful expenses incurred by him, or the increase in value which the land may have acquired by reason of the improvement, at the option of the landowner. The builder is entitled to a refund of the expenses he incurred, and not to the market value of the improvement. The case of Pecson v. CA (G.R. No. 115814, 26 May 1995), is not applicable to the problem. In the Pecson case, the builder was the owner of the land who later lost the property at a public sale due to non-payment of taxes. The Court ruled that Article 448 does not apply to the case where the owner of the land is the builder but who later lost the land; not being applicable, the indemnity that should be paid to the buyer must be the fair market value of the building and not just the cost of construction thereof. The Court opined in that case that to do otherwise would unjustly enrich the new owner of the land.

2. Pablo is entitled to the rentals of the building. As the owner of the land, Pablo is also the owner of the building being an accession thereto. However, Pedro who is entitled to retain the building is also entitled to retain the rentals. He, however, shall apply the rentals to the indemnity payable to him after deducting reasonable cost of repair and maintenance.

4.) Mike built a house on his lot in Pasay City. Two years later, a survey disclosed that a portion of the building actually stood on the neighboring land of Jose, to the extent of 40 square meters. Jose claims that Mike is a builder in bad faith because he should know the boundaries of his lot, and demands that the portion of the house which encroached on his land should be destroyed or removed. Mike replies that he is a builder in good faith and offers to buy the land occupied by the building instead. 1) Is Mike a builder in good faith or bad faith? Why? 2) Whose preference should be followed? Why?

1) Yes, Mike is a builder in good faith. There is no showing that when he built his house, he knew that a portion thereof encroached on Jose's lot. Unless one is versed in the science of surveying, he cannot determine the precise boundaries or location of his property by merely examining his title. In the absence of contrary proof, the law presumes that the encroachment was done in good faith. (Technogas Phils, v. CA, G.R. No. 108894, February 10, 1997)

2) None of the preferences shall be followed. The preference of Mike cannot prevail because under Article 448 of the Civil Code, it is the owner of the land who has the option or choice, not the builder. On the other hand, even though the option belongs to Jose, he cannot demand that the portion of the house encroaching on his land be destroyed or removed because this is not one of the options given by law to the owner of the land. The owner may choose between the appropriation of what was built after payment of indemnity, or to compel the builder to pay for the land if the value of the land is not considerably more than that of the building. Otherwise, the builder shall pay rent for the portion of the land encroached.

5.) For many years, the Rio Grande river deposited soil along its bank, beside the titled land of Jose. In time, such deposit reached an area of one thousand square meters. With the permission of Jose, Vicente cultivated the said area. Ten years later, a big flood occurred in the river and transferred 1000 square meters to the opposite bank, beside the land of Agustin. The land transferred is now contested by Jose and Agustin as riparian owners , and by Vicente who claims ownership by prescription. Who should prevail? Why?

Jose should prevail. The disputed area, which is an alluvion, belongs by right of accretion to Jose, the riparian owner. (Art. 457) When, as given in the problem, the very same area was "transferred" by flood waters to the opposite bank, it became an avulsion and ownership thereof is retained by Jose who has two years to remove it. (Art. 459) Vicente's claim based on prescription is baseless since his possession was by mere tolerance of Jose and, therefore, did not adversely affect Jose's possession and ownership. (Art. 537) In as much as his possession is merely that of a holder, he cannot acquire the disputed area by prescription.

6.) Andres is a riparian owner of a parcel of registered land. His land, however, has gradually diminished in area due to the current of the river, while the registered land of Mario on the opposite bank has gradually increased in area by 200-square meters. a) Who has the better right over the 200- square meter area that has been added to Mario’s registered land, Mario or Andres? b) May a third person acquire said 200- square meter land by prescription?

a. Mario has a better right over the 200 square meters increase in area by reason of accretion, applying Article 457 of the New Civil Code, which provides that “to the owners of lands adjoining the banks of rivers belong the accretion which they gradually received from the effects of the current of the waters.” Andres cannot claim that the increase in Mario’s land is his own, because such is an accretion and not a result of the sudden detachment of a known portion of his land and its attachment to Mario’s land, a process called “avulsion”. He can no longer claim ownership of the portion of his registered land which was gradually and naturally eroded due to the current of the river, because he had lost it by operation of law. That portion of the land has become part of the public domain.

b. Yes, a third party may acquire by prescription the 200 square meters, increase in area, because it is not included in the Torrens Title of the riparian owner. Hence, this does not involve the imprescriptibility conferred by Section 47, P.D. No. 1529. The fact that the riparian land is registered does not automatically make the accretion thereto a registered land. (Grande v. CA, G.R. No. L- 17652, June 30, 1962; Jagualing v. CA, G.R. No. 94283, March 4, 1991)

7.) The properties of Jessica and Jenny, who are neighbors, lie along the banks of the Marikina River. At certain times of the year, the river would swell and as the water recedes, soil, rocks and other materials are deposited on Jessica's and Jenny's properties. This pattern of the river swelling, receding and depositing soil and other materials being deposited on the neighbors’ properties have gone on for many years. Knowing this pattern, Jessica constructed a concrete barrier about 2 meters from her property line and extending towards the river, so that when the water recedes, soil and other materials are trapped within this barrier. After several years, the area between Jessica's property line to the concrete barrier was completely filled with soil, effectively increasing Jessica's property by 2 meters. Jenny's property, where no barrier was constructed, also increased by one meter along the side of the river. a) Can Jessica and Jenny legally claim ownership over the additional 2 meters and one meter, respectively, of land deposited along their properties? b) If Jessica's and Jenny's properties are registered, will the benefit of such registration extend to the increased area of their properties? c) Assume the two properties are on a cliff adjoining the shore of Laguna Lake. Jessica and Jenny had a hotel built on the properties. They had the earth and rocks excavated from the properties dumped on the adjoining shore, giving rise to a new patch of dry land. Can they validly lay claim to the patch of land?

a) Jenny can legally claim ownership of the lands by right of accession (accretion) under Art. 457 of the Civil Code. The lands came into being over the years through the gradual deposition of soil and silt by the natural action of the waters of the river.

Jessica cannot claim the two-meter-wide strip of land added to her land. Jessica constructed the cement barrier two meters in front of her property towards the river not to protect her land from the destructive forces of the water but to trap the alluvium. In order that the riparian owner may be entitled to the alluvium, the deposition must occur naturally without the intervention of the riparian owner. (Republic v. CA 132 SCRA 514 [1984])

b) No, the registration of Jessica’s and Jenny’s adjoining property does not automatically extend to the accretions. They have to bring their lands under the operation of the Torrens system of land registration following the procedure prescribed in P.D. No. 1529.

c) Jessica and Jenny cannot validly lay claim to the price of dry land that resulted from the dumping of rocks and earth materials excavated from their properties because it is a reclamation without authority. The land is part of the lakeshore, if not the lakebed, which is inalienable land of the public domain.

8.) Marciano is the owner of a parcel of land through which a river runs out into the sea. The land had been brought under the Torrens System, and is cultivated by Ulpiano and his family as farmworkers therein. Over the years, the river has brought silt and sediment from its sources up in the mountains and forests so that gradually the land owned by Marciano increased in area by three hectares. Ulpiano built three huts on this additional area, where he and his two married children live. On this same area, Ulpiano and his family planted peanuts, monggo beans and vegetables. Ulpiano also regularly paid taxes on the land, as shown by tax declarations, for over thirty years. When Marciano learned of the increase in the size of the land, he ordered Ulpiano to demolish the huts, and demanded that he be paid his share in the proceeds of the harvest. Marciano claims that under the Civil Code, the alluvium belongs to him as a registered riparian owner to whose land the accretion attaches, and that his right is enforceable against the whole world. a) Is Marciano correct? Explain. b) What rights, if any, does Ulpiano have against Marciano? Explain.

a) Marciano’s contention is correct. Since that accretion was deposited on his land by the action of the waters of the river and he did not construct any structure to increase the deposition of soil and silt, Marciano automatically owns the accretion. His real right of ownership is enforceable against the whole world including Ulpiano and his two marriedchildren.AlthoughMarciano’s land is registered, the three (3) hectares land deposited through accretion was not automatically registered. As an unregistered land, it is subject to acquisitive prescription by third persons.

Although Ulpiano and his children live in the three (3) hectare unregistered land owned by Marciano, they are farm workers; therefore, they are possessors not in the concept of owners but in the concept of mere holders. Even if they possess the land for more than 30 years, they cannot become the owners thereof through extraordinary acquisitive prescription, because the law requires possession in the concept of the owner. Payment of taxes and tax declaration are not enough to make their possession one in the concept of owner. They must repudiate the possession in the concept of holder by executing unequivocal acts of repudiation amounting to ouster of Marciano, known to Marciano and must be proven by clear and convincing evidence. Only then would his possession become adverse.

b) Although Ulpiano is a possessor in bad faith, because he knew he does not own the land, he will lose the three huts he built in bad faith and make an accounting of the fruits he has gathered, he has the right to deduct from the value of the fruits the expenses for production, gathering and preservation of the fruits. (Art. 443)

He may also ask for reimbursement of the taxes he has paid, as these are charges on the land owned by Marciano. This obligation is based on a quasi-contract. (Art. 2175)

9.) Believing that he owned a certain parcel of land and completely unaware of any defect in his title thereto, Mr. A started to build a house thereon. When Mr. P, the real owner of the land learned of Mr. A's actions, Mr. P immediately demanded Mr. A to leave the premises. However, Mr. A refused to leave, and instead, asserted that as a builder in good faith, Mr. P is obliged to sell the land to him. a. Is the claim of Mr. A correct? Explain. b. Assuming that Mr. P all the while, knew but did not object to Mr. A's construction of the house on his property, may Mr. A compel Mr. P to purchase the said improvement due to Mr. P's bad faith? Explain.

a. No, Mr. A is not correct. Mr. A who was completely unaware of any defect in his title, is a builder in good faith. Mr. P who prompted Mr. A’s possession also acted in good faith. Article 448 applies in this case, which provides that only the owner of the land on which anything has been built, sown or planted in good faith, has the right to appropriate as his own the works, sowing or planting, after payment of the indemnity for necessary expenses and useful expenses where applicable, OR to oblige the one who built or planted to pay the price of the land, and the one who sowed, the proper rent; however, the builder or planter cannot be obliged to buy the land if its value is considerably more than that of the building or trees. The law grants said rights to the owner of the land. The builder in good faith, Mr. A in this case, cannot compel Mr. P, the owner of the land, to choose which right to exercise, for the option belongs to the owner alone.

b. Yes, Mr. A may compel Mr. P to purchase the improvements, Under Art. 454 of the Civil Code it provides that when the landowner acted in bad faith and the builder, planter or sower proceeded in good faith, the provisions under Art. 447 shall apply. Art. 453 of the same Code provides that 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. 447 provides that the owner of the land who makes thereon, personally or through another, plantings, constructions or works with the materials of another, shall pay their value; and, 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. The landowner, having known and without opposing the construction made by Mr. A is deemed to have acted in bad faith: Art. 447, therefore, applies and Mr. P shall pay the value of the improvement; i.e., the value of the materials, plus damages.

10.) In an ejectment case filed by Don against Cesar, can the latter ask for the cancellation of Don's title considering that he (Cesar) is the rightful owner of the lot? Explain.

Cesar cannot ask for the cancellation of Don's title in the ejectment case filed by Don against him. Under Section 48 of PD 1529, the Property Registration Decree, a Torrents title shall not be subject to collateral attack. It cannot be altered, modified or cancelled except in a direct proceeding in accordance with law. The ejectment proceeding does not provide the proper forum for the cancellation of Don’s title. While Cesar’s counterclaim for cancellation of Don’s title may be considered a direct attack, the same should nevertheless be denied on procedural grounds because a Municipal or Metropolitan Trial Court is without jurisdiction to cancel a Torrens title.