DE

VERA v MAYANDOC Respondents, manifested their option to buy the land where the
G.R. No. 211170 house stood, but petitioners expressed that they were not interested
to sell the land or to buy the house in question.
This is a Complaint for useful expenses under Articles 448 and 546 of
the New Civil Code of the Philippines. ISSUE: Whether or not respondents were in bad faith in introducing
improvements on the subject land.
FACTS: A parcel of land originally owned by Eusebio Espinoza was
divided among his heirs, Pastora, Domingo and Pablo, after his death. To be deemed a builder in good faith, it is essential that a person
asserts title to the land on which he builds, i.e., that he be a possessor
Pastora executed a Deed of Sale conveying her share to respondents in the concept of owner, and that he be unaware that there exists in
and Leopoldo Espinoza. On that same date, a fictitious deed of sale his title or mode of acquisition any flaw which invalidates it.
was executed by Domingo Espinoza, conveying the 3/4 share in favor
of respondent Erlinda Cayabyab. Later on, a fictitious deed of sale The settled rule is bad faith should be established by clear and
was executed by Nemesio Cayabyab, Candida Cruz, Sps. Maximo convincing evidence since the law always presumes good faith. In this
Espinoza and Winifreda De Vera and Leopoldo Espinoza over the land particular case, petitioners were not able to prove that respondents
in favor of Sps. Antonio and Erlinda Mayandoc. were in bad faith in constructing the house on the subject land. Bad
faith does not simply connote bad judgment or negligence. It imports
As a result, petitioners filed an action for annulment of document in a dishonest purpose or some moral obliquity and conscious doing of
which RTC rendered a Decision ordering respondents to reconvey the a wrong. It means breach of a known duty through some motive,
land in dispute. CA affirmed the decision with modification and has interest or ill will that partakes of the nature of fraud. For anyone who
become final. claims that someone is in bad faith, the former has the duty to prove
such. Hence, petitioners err in their argument that respondents failed
Thus, respondents filed a complaint for reimbursement for useful to prove that they are builders in good faith in spite of the findings of
expenses, pursuant to Articles 448 and 546 of the New Civil Code, the RTC and the CA that they are.
alleging that the house in question was built on the disputed land in
good faith. The respondents believed themselves to be the owners of As such, Article 448 of the Civil Code must be applied. It applies when
the land with a claim of title thereto and were never prevented by the builder believes that he is the owner of the land or that by some
the petitioners in constructing the house. Petitioners argued that title he has the right to build thereon, or that, at least, he has a claim
respondents can never be considered as builders in good faith of title thereto. InTuatzs v. Spouses Escol, et al., this Court ruled that
because the latter were aware that the deeds of sale over the land in the seller (the owner of the land) has two options under Article 448:
question were fictitious. (1) he may appropriate the improvements for himself after
reimbursing the buyer (the builder in good faith) the necessary and
useful expenses under Articles 546 and 548 of the Civil Code; or (2)
he may sell the land to the buyer, unless its value is considerably
more than that of the improvements, in which case, the buyer shall
pay reasonable rent, xxx FACTS:
● Basilia Imbornal+ (Basilia) had four (4) children, namely, Alejandra,
The rule that the choice under Article 448 of the Civil Code belongs Balbina, Catalina, and Pablo.Francisco I. Narvasa, Sr.9 (Francisco) and
to the owner of the land is in accord with the principle of accession, Pedro Ferrer (Pedro) were the children10 of Alejandra, while
i.e., that the accessory follows the principal and not the other way petitioner Petra Imbornal (Petra) was the daughter of Balbina.
around. Even as the option lies with the landowner, the grant to him, ● Petitioners are the heirs and successors-in-interest of Francisco,
nevertheless, is preclusive. The landowner cannot refuse to exercise Pedro, and Petra (Francisco, et al.)
either option and compel instead the owner of the building to ● Respondents are Emiliana, Victoriano, Felipe, Mateo, Raymundo,
remove it from the land. Maria, and Eduardo, all surnamed Imbornal, are the descendants of
Pablo.
The raison d’etre for this provision has been enunciated thus: Where ● Meanwhile, Catalina’s husband, Ciriaco Abrio (Ciriaco), applied for
the builder, planter or sower has acted in good faith, a conflict of and was granted a homestead patent over a 31,367-sq. m. riparian
rights arises between the owners, and it becomes necessary to land (Motherland) adjacent to the Cayanga River in San Fabian,
protect the owner of the improvements without causing injustice to Pangasinan.
the owner of the land. In view of the impracticability of creating a ● Ciriaco - Northern portion of the Motherland
state of forced co-ownership, the law has provided a just solution by ● Respondents Imbornal - Southern portion of the Motherland
giving the owner of the land the option to acquire the improvements ● First Accretion: approximately 59,772 sq. m. in area,
after payment of the proper indemnity, or to oblige the builder or adjoined the southern portion of the Motherland. On August 15,
planter to pay for the land and the sower the proper rent. He cannot 1952, OCT No. P-318 was issued in the name of respondent
refuse to exercise either option. It is the owner of the land who is Victoriano, married to Esperanza Narvarte, covering the First
authorized to exercise the option, because his right is older, and Accretion.
because, by the principle of accession, he is entitled to the ownership ● Second Accretion: an area of 32,307 sq. m., more or less, abutted
of the accessory thing. the First Accretion on its southern portion. Subsequent OCT was
likewise issued.
NARVASA v IMBORNAL ● Francisco et al. filed a complaint for reconveyance, partition, and
Topic: Accession or damages against respondents Imbornal.
RECIT READY: Petitioners are claiming ownership over the property ● Francisco et al. argues that:
currently in possession of the Imbornals by reason of (2) accretions ○ Through deceit, fraud, falsehood, and
despite not being riparian owners. The Supreme Court held that only misrepresentation, respondent Victoriano, with respect to the First
riparian owners may benefit from accretion of a land. Since it was the Accretion, and the respondents collectively, with regard to the
Imbornals who were in possession of a land adjacent to that of the Second Accretion, had illegally registered the said accretions in their
river, they are the rightful owners of the property resulting from names, notwithstanding the fact that they were not the riparian
accretion.
owners (as they did not own the Motherland to which the accretions communication from the Director of Lands advising him of his
merely formed adjacent to). preferential right.
○ Thus, bewailing that respondents have refused them their rights ● That rule in paragraph 32 is in consonance with Article 4 of the
not only with respect to the Motherland, but also to the subsequent Spanish Law of Waters of 1866 which provides that, while lands
accretions, Francisco, et al. prayed for the reconveyance ofsaid added to the shore by accretions and alluvial deposits caused by the
properties, or, in the alternative, the payment of their value, as well action of the sea form part of the public domain, such lands, "when
as the award of moral damages in the amount of ₱100,000.00, actual they are no longer washed by the waters of the sea and are not
damages in the amount of ₱150,000.00, including attorney’s fees and necessary for purposes of public utility, or for the established [sic] of
other costs. special industries, or for the coast guard service, "shall be declared
● RTC: Petitioners by the Government "to be the property of the owners of the estates
● CA: Reversed, ruled in favor of the Imbornals adjacent thereto and as increment thereof."
● In other words, article 4 recognizes the preferential right of the
ISSUE: Whether or not the Imbornals have the better right over the littoral owner (riparian according to paragraph 32) to the
property resulting from the FIRST and SECOND accretion foreshore land formed by accretions or alluvial deposits due
to the action of the sea.
HELD: ● Accordingly, therefore, alluvial deposits along the banks of a
● YES, the Imbornals have the better right. Francisco et al. failed to creek or a river do not form part of the public domain as the alluvial
prove their ownership rights over the Motherland. property automatically belongs to the owner of the estate to which
Article 457 of the Civil Code states the rule on accretion as follows: it may have been added. The only restriction provided for by law is
"[t]o the owners of lands adjoining the banks of rivers belong the that the owner of the adjoining property must register the same
accretion which they gradually receive from the effects of the current under the Torrens system; otherwise, the alluvial property may be
of the waters." subject to acquisition through prescription by third persons
● Being the owner of the land adjoining the foreshore area, ● In this case, Francisco, et al. and, now, their heirs, i.e., herein pe
respondent is the riparian or littoralowner who has preferential right titioners are not the riparian owners of the Motherland to which the
to lease the foreshore area as provided under paragraph 32 of the First Accretion had attached, hence, they cannot assert ownership
Lands Administrative Order No. 7-1, dated 30 April 1936, which over the First Accretion.
reads: ● Consequently, as the Second Accretion had merely attached to the
○ 32. Preference of Riparian Owner. – The owner of the property First Accretion, they also have no right over the Second Accretion.
adjoining foreshore lands, marshylands or lands covered with water WHEREFORE, the petition is DENIED. The Decision dated November
bordering upon shores or banks of navigable lakes or rivers, shall be 28, 2006 and the Resolution dated May 7, 2008 of the Court of
given preference to apply for such lands adjoining his property as may Appeals in CA-G.R. CV No. 57618 are hereby AFFIRMED, and a new
not be needed for the public service, subject to the laws and judgment is entered DISMISSING the Amended Complaint dated
regulations governing lands of this nature, provided that he applies February 27, 1984 filed in said case.
therefor within sixty (60) days from the date he receives a
LEVISTE MANAGEMENT SYSTEM v. LEGASPI TOWERS 200 INC., et. .
al. 3. The RTC affirmed Respondent wherein it found application of
G.R. No. 199353 April 4, 2018 Art. 448 of the Civil Code and Depra v. Dumlao . The “air space” above
TOPIC: Builder in Good Faith the unit actually belongs to Respondent.
PONENTE: J. Leonardo-De Castro
4. Respondent sought to demolish Concession 4 at the expense
CASE LAW/ DOCTRINE: of Petitioner. Respondent argued that Petitioner should first get the
• Art. 448 and 546 of the Civil Code on builders in good faith consent of the registered owners of the condominium project before
are inapplicable in cases covered by the Condominium Act. amendment of the Master Deed under Sec. 4 of the Condominium
Act. Petitioner argued that there must be a determination of the
• The land belongs to a condominium corporation wherein the required values under Depra before Respondent can take action.
builder, as a unit owner, is considered a stockholder or member
under Sec. 10 of the Condominium Act. The builder is already in co- 5. RTC: Affirmed Respondent.
ownership with other unit owners as members or stockholders of the
condominium corporation. The purchaser of a condominium unit 6. CA: Affirmed RTC Decision.
binds himself to a contract with other unit owners. ISSUE(S): Whether Respondent can build Concession 4 on top of
Petitioner’s condominium building.
• A builder must gain the consent of other registered owners
and follow the by-rules of the condominium before amending the HELD: No. Petitioner contravened the Master Deed by adding a 3rd
Master Deed. level above the roof deck and by violating the Condominium Act and
FACTS: Respondent’s by-laws.
1. Legaspi Towers is a 7-floor condominium building with a deck RATIO:
roof and 2 levels above the deck roof, as stated in the Master Deed, • Instead of procuring the required consent of the registered
at Paseo De Roxas, Makati City with a unit on the roof deck and 2 owners under Sec. 4 of the Condominium Act or having Concession 4
levels above said unit called Concession 2 and Concession 3. approved by the members in a regular or special meeting called for
Concession 3 was bought by Leviste Management System the purpose under Respondent’s by-laws, Petitioner merely had an
(Petitioner). internal agreement with the former president of Respondent. This
cannot bind corporations since they can act only through their Board
2. Petitioner sought to build another unit called Concession 4 of Directors.
on top of Concession 3 and was able to secure a buiding permit for
its construction. However, Legaspi Towers 200 Inc. (Respondent) sent • Art. 448 of the Civil Code on builders in good faith does not
a notice to Petitioner that its construction was illegal but the latter apply where there is contractual relation between the parties. The
did not heed such. Petitioner filed a writ of mandatory injunction RTC erred in considering Art. 448 and Art. 546 of the Civil Code in this
against Respondent. case.
 legislation on the subject property and by contract (the Master Deed
Article 448. The owner of the land on which anything has been built, and the By-Laws of the condominium corporation).
sown or planted in good faith, shall have the right to appropriate as
his own the works, sowing or planting, after payment of the Lim v. Moldex Land, Inc.
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 Facts: Condocor (Condominium Corporation) a non-stock, non-
sowed, the proper rent. However, the builder or planter cannot be profit corporation, which is the registered condominium
obliged to buy the land if its value is considerably more than that of
corporation for the Golden Empire Tower held its annual
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 general membership meeting. Moldex became a member of
trees after proper indemnity. The parties shall agree upon the terms Condocor on the basis of its ownership of the 220 unsold units
of the lease and in case of disagreement, the court shall fix the terms in the Golden Empire Tower. During the meeting, an existence
thereof. (361a)
of a quorum was declared even though only 29 of the 108 unit

Article 546. Necessary expenses shall be refunded to every possessor; buyers were present. The declaration was based on the
but only the possessor in good faith may retain the thing until he has presence of the majority of the voting rights, including those
been reimbursed therefor. pertaining to the 220 unsold units held by Moldex through its

representatives. Lim (a registered unit owner), through her
Useful expenses shall be refunded only to the possessor in good faith
with the same right of retention, the person who has defeated him in attorney-in-fact, objected to the validity of the meeting. The
the possession having the option of refunding the amount of the objection was denied. Thus, Lim and all the other unit owners
expenses or of paying the increase in value which the thing may have present, except for one, walked out and left the meeting.
acquired by reason thereof. (453a)
Despite the walkout, the individual respondents and the other
The land belongs to a condominium corporation wherein the builder,
unit owner proceeded with the meeting and elected the new
as a unit owner, is considered a stockholder or member under Sec.
10 of the Condominium Act. The builder is already in co-ownership members of the Board of Directors for 2012-2013. All 4
with other unit owners as members or stockholders of the individual respondents (JAMINOLA, MACALINTAL, MILANES,
condominium corporation. Thus, the purchaser of a condominium and ROMAN) were voted as members of the board, together
unit binds himself to a contract with other unit owners.
with other 3 members.

• Art. 448 and 546 of the Civil Code on builders in good faith Consequently, Lim filed an election protest before the RTC. Lim
are inapplicable in cases covered by the Condominium Act where the
claimed that herein respondents are not entitled to be
owner of the land and the builder are already bound by specific
members of the Board of Directors because they are non-unit
buyers. However, said court ruled in favor for the respondents. land, or the appurtenant interests in such areas, may be held
Not in conformity, Lim filed the present petition. by a corporation specially formed for the purpose (hereinafter
known as the "condominium corporation") in which the
Issue: Whether only unit buyers are entitled to become
holders of separate interest shall automatically be members
members of Condocor.
or shareholders, to the exclusion of others, in proportion to
the appurtenant interest of their respective units in the
Ruling: No. Moldex can be deemed a member of Condocor.
common areas.
Lim asserted that only unit buyers are entitled to become
The Condominium Act does not provide a specific mode of
members of Condocor. Respondents, for their part, countered
acquiring ownership of a unit. It is erroneous to argue that the
that a registered owner of a unit in a condominium project or
ownership must result from a sale transaction between the
the holders of duly issued condominium certificate of title
owner-developer and the purchaser. Such interpretation would
(CCT), automatically becomes a member of the condominium
mean that persons who inherited a unit, or have been donated
corporation, relying on Sections 2 and 10 of the Condominium
one, and properly transferred title in their names cannot
Act, the Master Deed and Declaration of Restrictions, as well as
become members of a condominium corporation.
the By-Laws of Condocor. For said reason, respondents averred
that as Moldex is the owner of 220 unsold units and the parking JOSEPH HARRY WALTER POOLE-BLUNDEN V. UNION BANK OF
slots and storage areas attached thereto, it automatically THE PHILIPPINES
became a member of Condocor upon the latter's creation. G.R. NO. 205838, 29 NOVEMBER 2017
LEONEN, J:
On this point, respondents are correct. Section 2 of the

Condominium Act states: FACTS: Poole-Blunden (petitioner) came across an

advertisement for public auction of certain properties placed by
Sec. 2. A condominium is an interest in real property consisting Union Bank in the Manila Bulletin sometime in March 2001.
of separate interest in a unit in a residential, industrial or One of these properties was Unit 2-C of T-Tower Condominium
commercial building and an undivided interest in common, located at Makati City. The condominium unit was acquired by
UnionBank through forclosure proceedings.
directly or indirectly, in the land on which it is located and in

other common areas of the building. A condominium may A week prior to the auction, petitioner visited the unit
include, in addition, a separate interest in other portions of for inspection. He found that the unit had an irregular shape,
such real property. Title to the common areas, including the but didn’t doubt the unit’s area as advertised, the ceiling in a
bad condition, and the unit needed substantial repairs to be its surveyor is 74.18 square meters which was much higher than
habitable. On the day of the auction, he also inspected the the unit area of 60 square meters that was approved by HLURB.
Master Title of the project owner to the condominium. The petitioner was dissatisfied with the said explanation.
Petitioner won the bid and he entered to a Contract to Sell with Petitioner filed for the recission of the Contract to Sell
UnionBank. He started occupying the unit in June 2001 and by with Damages with the RTC of Makati and said court dismissed
July 2003, he was able to fully pay for the unit, paying a total the complaint. The CA affirmed the ruling of the RTC stating
amount of P 3,257,142.49.00. that the sale was made on a "as-is-where-is" basis as indicated
in their contract. Thus, the petitioner supposedly waived any
Petitioner decided to construct two additional errors in the bounds or description of the unit. With the denial
bedrooms in the unit. He noticed apparent problems in its of his Motion for Reconsideration, he filed for a petition to the
dimensions. He took a rough measurement and found that the Supreme Court stating that: there is a vitiation of his consent as
floor area was just 70 sqm, not 95 sqm as advertised. He got in to the object of the sale and he charges UnionBank with fraud
touch with an officer of UnionBank to raise the matter, but no since it failed to disclose to him that the advertised 95 square
action was taken. He then wrote to Unionbank to inform them meters was inclusive of common areas. Thus, the Contract to
of the discrepancy and asked for the rescission of the Contract Sell may be voided and that UnionBank is liable for breach of
to Sell, along with the refund of the amounts he had paid. warranty despite the "as-is-where-is" clause in the Contract to
UnionBank replied that upon inquiring with HLURB, the Sell.
Homeowners’s Association of T-Tower, and its appraisers, the
unit was confirmed to be 95 sqm inclusive of the terrace and ISSUE: Whether or not UnionBank committed such a degree of
the comon areas surrounding it. The petitioner was not fraud that would entitle the petitoner to the voiding of the
satisfied because according to the Master Title, “boundary of Contract to Sell the said condominium unit for his failure to
each unit are the interior surfaces of the perimeter walls, floors, disclose that the 95 sqm as advetised already included common
ceilings, windows and doors thereof." He hired an independent areas.
geodetic engineer, to survey the unit and measure its actual
floor. It was found out that the actual area was only 74.4 sqm HELD: Yes. Respondent's insistence on how common spaces
and gave a copy of the certification to Unionbank. UnionBank should be included in reckoning the Unit's total area runs afoul
explained that the total area of the unit is based on the ratio of how Republic Act No. 4726, otherwise known as the
allocation maintenance cost submitted by the developer to Condominium. Section 3(b) of the Condominium Act defines a
HLURB is 98 square meters (60 square meters as unit area and condominium unit, as follows:

38 square meters as share on open space). On the other hand, "Unit" means a part of the condominium project intended for any
the actual area thereof based on the measurements made by type of independent use or ownership, including one or more rooms or
spaces located in one or more floors (or part or parts of floors) in a building stipulation can only pertain to the readily perceptible physical
or buildings and such accessories as may be appended thereto. state of the object of a sale. It cannot encompass matters that

require specialized scrutiny, as well as features and traits that
Section 6(a) of the Condominium Act specifies the reckoning of
are immediately appreciable only by someone with technical
a condominium unit's bounds. It also specifies that areas of
competence.
common use "are not part of the unit":


The boundary of the unit granted are the interior surfaces of the Thus, the Court ordered that the Contract to Sell
perimeter walls, floors, ceilings, windows and doors thereof. The following between petitioner and respondent be annulled, and petitioner
are not part of the unit bearing walls, columns, floors, roofs, foundations be refunded all the amounts he paid to respondent in respect
and other common structural elements of the building; lobbies, stairways, of the purchase of the Unit plus damages.
hallways, and other areas of common use.

Thus, the unit sold to petitioner was deficient in relation
to its advertised area. This advertisement having been made by
respondent, it is equally settled there was a falsity in the
declarations made by respondent prior to, and with the
intention of enticing buyers to the sale.


Petitioner's contention on how crucial the dimensions
and area of the Unit are to his decision to proceed with the
purchase is well-taken. The significance of space and
dimensions to any buyer of real property is plain to see. This is
particularly significant to buyers of condominium units in urban
areas, and even more so in central business districts, where the
scarcity of space drives vertical construction and propels
property values.
The defense of "as-is-where-is" terms of the purchase is
untenable. First, a stipulation absolving a seller of liability for
hidden defects can only be invoked by a seller who has no
knowledge of hidden defects. Respondent here knew that the
Unit's area, as reckoned in accordance with the Condominium
Act, was not 95 square meters. Second, an as-is-where-is