Real and Personal Properties

Property and modes of acquiring ownership

A thing is generally understood to be any object that exists and is capable of satisfying some human needs.
It includes both objects that are already possessed or owned and those that are susceptible of appropriation.
Property refers to anything which is already the object of appropriation or is found in the possession of man. The civil
code uses the terms interchangeably and synonymously. However, there are things which are not susceptible of
appropriation and they are not included in the concept of property.
Requisites:
1. Utility or the capacity to satisfy some human wants;
2. Substantivity or individuality or the quality of having existence apart from other things;
3. Appropriability or the susceptibility of being possessed by men
Real property from personal property
Article 414 provides all things which are or maybe the object of appropriation are considered either
immovable or real property or movable or personal property the classification of real property and personal property.
Under Article 414 is based on the nature of the thing itself or on its mobility or immobility. Generally, however real
properties are things that are permanently or intended to be permanently attached or fixed to another thing or cannot
be transferred from place to place or if they can be transferred the transfer cannot be done without injury or damage
to the immovable to which they are attached. Otherwise they are personal property.
The importance of the classification of real property from personal property is because in criminal law
usurpation of property can take place only with respect to real property, robbery or theft can be committed only
against personal property.
In procedure actions concerning real property or real actions are brought in the original trial court where the
property or any part thereof lies actions involving personal property on the other hand are brought in the court where
the defendant or any of its defendants reside or may be found or the plaintiff or any of the plaintiffs reside or may be
found at the election of the plaintiff.
An action for the recovery of possession of real property may be forcible entry or unlawful detainer while in
personal property we have the provisional remedy of replevin or manual delivery of the personal property.
In contracts real property is the subject matter of real mortgage and antichresis, while in personal property it
is the subject matter of simple loan or mutuum voluntary deposit pledge and chattel mortgage.
For purposes of donation, Article 748 provides that the donation of a movable may be made orally or in
writing. An oral donation requires the simultaneous delivery of the thing or of the document representing the right
donated. If the value of the personal property donated exceeds 5000 pesos the donation and the acceptance shall be
made in writing otherwise the donation shall be void. While article 479 of the civil code provides in order that the
donation of an immovable may be valid it must be made in a public document specifying the property donated and
the value of the charges which the donee must satisfy. The acceptance may be made in the same deed of donation
or in a separate public document but it shall not take effect unless it is done during the lifetime of the donor. If the
acceptance is made in a separate document or instrument, the donor shall be notified thereof in an authentic form
and this step shall be noted in both instruments.
And for purposes of prescription, ownership over immovables is acquired by prescription although there is
bad faith in 30 years. Article 1137 of the new civil code for movables it is eight years.
Article 1132 what are the movable properties.
 Article 415 of the new civil code enumerates the immovable properties and this enumeration is exclusive.
The classification of real or immovable property are: by nature, by incorporation, by destination and by analogy.
1. By nature- those property which by their essence and nature are immovable or cannot be carried from place
to place like lands roads and trees mines quarries and slug dumps
2. By incorporation- these are those immovable property which are treated as immovable by reason of their
attachment to an immovable in a fixed manner to be an integral part thereof, like building constructions of all
kinds adhere to the soil like walls, fences, trees, statues, and animal houses.
3. By destination- those which are essentially movable but placed in an immovable for the utility it gives to the
activity carried there on such as machinery installed in a building and ducts on a river.
4. By analogy- it is so classified by express provision of law because it is regarded as united to the immovable
property.
Real property or immovable property by nature these are lands, they're the best examples of immovable
property it is real by nature and definition even if it is rented to buildings. Buildings are immovable provided it is 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, a building is always immovable whether built in one's own land or rented. A
structure which is merely superimposed on and not adhered to the soil, for instance barong-barong, is considered as
movable property.
A house or a building is immovable property but once a house is demolished, its character as an immovable
ceases because a house is classified as an immovable property by reason of its adherence to the soil on which it is
built. This is the case of Bisera versus Teneza, decided on November 29, 1962.
A building by itself is a real or immovable property distinct from the land on which it is constructed and
therefore it can be a separate subject of contracts. A building by itself may be mortgaged apart from the land on
which it was built even if a mortgage of land necessarily includes in the absence of stipulation of improvements
thereon. Buildings such a mortgage would still be a real estate mortgage for the building would still be considered
immovable property even if dealt with separately and apart from the land.
The case of Yi vs Strong Machinery Company decided on February 15, 1918. the sale of a factory building
made of strong materials over which a chattel mortgage was executed was annotated in the chattel mortgage
registry. The SC held that the building of strong material is real property and the mere fact that the party seemed to
have dealt with it separate and apart from the land on which it stood does not change its character as real property.
What is the effect of real property treated by parties as personal property? A building is an immovable
irrespective of whether or not said structure and the land on which it is adhered to belong to the same owner or
whether the building is erected by the owner of the land or by a use of factory or leasing. Hence a valid real estate
mortgage can be constituted on the building erected on the land belonging to another. It may happen that the
contracting parties stipulate that a real property be considered as personal after agreeing to such stipulation they are
consequently estopped from claiming otherwise. If the parties will treat a building as a movable as between them,
they are estopped from alleging the contrary. The character of the building as a real property is not altered because
the same is provided by law and cannot be changed by mere agreement of the parties. The parties are simply barred
from questioning the validity of the agreement they voluntarily entered into; however, this does not apply to strangers
to the said contract. As far as third persons who are not parties to the contract, the house or building is considered as
immovable property.
The court also ruled that the register of deeds may not refuse the registration of the chattel mortgage on the
pretext that the subject matter thereof is not a personal property, for the duties of the register of deeds in respect to
the registration of chattel mortgages are of purely ministerial character.
Under certain conditions a property may have a character different from that imputed to it in article 415 and
416 of the civil code the parties to a contract of chattel mortgage made by agreement treat as personal that which by
nature would be real such as lease hold rights in building a house of mixed materials which by its very nature is
considered real property the chattel mortgage is not binding on third persons. It is good only in so far as the
contracting parties are concerned. With respect to third persons who are not parties to the contract, the house is
considered as immovable property. A chattel mortgage on house built on rented land, the law makes no distinction as
to the ownership of the land on which the house is built. The house may thus be considered movable or personal
property subject of a chattel mortgage and the parties thereto are stopped later from claiming otherwise.

Constructions adhere to the soil such as fruits and constructions are considered integral parts of the land.
To be immovable the construction must be attached permanently to the land and it must not be of provisional or
temporary character, but fixed or integral. Example of this is the constructions of railroads.
A wall or fence is to be regarded as construction by incorporation. It is immovable as long as there is an
intent to attach it permanently although it is merely made to rest on the land.
In the case of board of assessment appeals versus manila electric company the supreme court held that the
steel towers were not considered real property because they were removable and merely attached to a square metal
frame by means of bolts which when unscrewed could easily be dismantled and moved from place to place.
However, in another case the supreme court held that the pipeline system was considered real property
because it is attached to the land in such a way that it cannot be separated therefrom without dismantling the steel
pipes which were welded to form the pipelines. That is the case of manila securities industrial corporation versus
cbaa.
Then there are also mines quarries and slug dumps while the matter thereof forms part of the bed and
waters either running or stagnant, they are considered immovables. While the matter thereof forms part of the bed,
they remain unseparated from the soil but when extracted they become movables for, they are no longer mines but
minerals.
The classification of immovable property real by incorporation, this refers to trees, plants and growing fruits
while they are attached to the land or form an integral part of an immovable. Growing fruits and crops are movables.
In other laws, such as the chattel mortgage law, these trees, plants and growing fruits are immovable property while
they are attached to the land or form an integral part of an immovable, on the theory that they derive their existence
or sustenance from the soil. Once they are cut off or uprooted, whether for firewood lumber or other use, they
become movable property.
They are considered immovable by nature if they are spontaneous products of the soil and by incorporation
if they are produced on lands of any kind through cultivation or labor. But for certain purposes and while still attached
to the soil growing fruits may exceptionally be treated as personal property. Ungathered fruits are considered
personal property for purposes of sale of the whole or part of the group crops under the chattel mortgage law.
Ungathered fruits have the nature of personal property.
For purposes of attachment and execution 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. Article 415
paragraph 3, it is the result which is important that it cannot be removed without causing damage. There is no
requirement that the attachment be done by the owner, the attachment must be such that it cannot be separated from
the immovable without breaking the material or deterioration of the object, such as walls, canals, aqueducts, they are
immovable by incorporation or attachment the intent to attach permanently is essential permanent annexation. They
become part of the land and lose their identity as movables or chattels. Physical attachment without intent or
permanent annexation is not itself enough.
Article 415 paragraph 3 should be distinguished from article 415 paragraph 4. Article 415 paragraph 3 states
everything attached to an immovable in a fixed manner in such a way that it cannot be separated there from without
breaking the material or deterioration of the object, article 415 paragraph 4 on the other hand states statues, relics,
paintings or other objects for use or ornamentation of the immovable in such a manner that it reveals the intention to
attach them permanently to the tenements. In paragraph 4, the incorporation must be made by the owner of the
immovable either personally or through an agent, while it is immaterial as to who makes the incorporation in
paragraph 3 of article 415. The incorporation in paragraph 3 must be such that separation is not possible while in
paragraph 4 separation is possible without deterioration of the immovable or destruction of the material.
Then there is the immovable property by destination. These are statutes, reliefs paintings and 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. The requisite for immobilization is that it is an
object of ornamentation or object of use. The object is placed on a building or land. The installation was made by the
owner of the building or the land and it is attached in such a manner that it reveals an intention to attach it
permanently. The object must be placed by the owner, it must be placed by the owner of the building or the land
although not necessarily by himself personally. If placed by a person, not the owner of the immovables such as a
lessee or usufructuary, the object will not attain the character of immovable unless such person acts as an agent of
the owner. The intent to attach permanently is essential. The object must be placed in the building or on land by the
owner of the immovable in such a manner that it reveals the intention to attach them permanently to the tenements.
They are immovable both by incorporation or attachment and by destination. The main consideration is the intention
to attach the objects permanently to the immovable machinery.
Receptacles, instruments or implements intended by the owner of the tenement for an industry or works
which may be carried on in a building or on a piece of land and which tend to directly meet the needs of the said
industry or works article 415 paragraph five the requisites for immobilization are the following one the object must be
either machinery receptacles instruments or implements for an industry or work two the object is installed in a
tenement three the installation is by the owner of the tenement four industry or works are carried on in the tenement
and five the object carries out directly the industry or work the machinery and so on so forth must be placed by the
owner of the tenant or his agent machinery which is movable by nature only becomes immobilized when placed on a
plant by the owner of the property or plant but not so when placed by a tenant use a factory or a person having only a
temporary right unless such person acted as an agent of the owner as when the tenant places it there pursuant to a
contract that it shall belong to the owner however such rule applies only to the tenant his assignees and creditors
who had sufficient notice of the agreement or the stipulation although the machineries are essentially and principally
elements of the industry they can be proper subjects of a wreath of replimen if the parties have treated the same as
personal property the industry or works must be carried on in a building or on a piece of land the machinery and so
on must tend directly to meet the needs of the said industry or works movable equipment to be immobilized must first
be essential and principal elements of an industry or works without which such industry or works would be unable to
function or carry on the industrial purpose for which it was established a machinery immobilized by destination
example those machinery instruments and implements delivered by the owner of the tenement to tenants for the
cultivation of the same should be considered as immobilized for they fulfill the condition of being intended for an
industry or works being carried on their own where the movables are merely incidental those movables which
become immobilized by destination because they are essential and principal elements in the industry must be
distinguished from those which may not be so considered immobilized because they are merely incidental the
attachment or incorporation to immovable is not essential as long as they are utilized or still needed in the industry
they continue to be immobilized although temporarily separated from the tenement a shuttle mortgage on
immobilized machineries and equipment the fact that the disputed machineries were heavy vaulted or cemented on
the real property mortgage does not make them ipso facto immovable under article 415 paragraph 3 and paragraph 5
as the party's intent has to be looked into it is considered personal property as when they are used as security for the
payment of an obligation over which a chattel mortgage is executed animal houses pigeon houses beehives fish
ponds or breeding places of similar nature in case their owner has placed them 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 article 415 paragraph 6. the requisites here are that the structure is placed by the owner and that the
installation must be with the intention to have them permanently attached and forming a part of it the construction
mentioned in paragraph 6 here must permanently form part of the land and so intended by the owner however since
such animals can by their nature be moved from place to place and without injury they are to be regarded as
personal property in case of alienation and for purposes of criminal law they may thus be the object of theft or
robbery fertilizer actually used on a piece of land article 415 number seven the fertilizer is real property since it
becomes an integral part of the soil they are immovable by destination and are immovables if they are actually used
because it is only when they form part of the land that they become immovable property hence fertilizers kept in the
warehouse are not immovable or those still in the containers which are in the land and to be used on the land article
415 paragraph 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 though floating they are classified as real property if intended by their nature and
object to remain at the fixed place on a river lake or coast article 415 paragraph 10 real by analogy these are
contracts for public works and servitudes and other real rights over immovable property real rights are those rights
which are enforceable against the whole world for a real right to be considered real property the real right must be
over an immovable property for example the real right of ownership of the land is considered real property while the
real right of ownership over a bag is considered personal property a real estate mortgage is a real right and a real
property by itself if the subject matter of the real right is a personal property such real right is classified as personal
property

article 416 refers to personal properties the following things are deemed to be personal property one those movable
susceptible of appropriation which are not included in the preceding article 2 real property which by any special
provision of law is considered as personal property 3 forces of nature which are brought under control by science and
four in general all things which can be transported from place to place without impairment of the real property to
which they are affixed 417 provides the following are also considered as personal property

one obligations and actions which have for their object movables or demandable sums and to shares of stock of
agricultural commercial and industrial entities although they may have real estate in general all things susceptible of
appropriation which can be transported from place to place without impairment of the real property to which they are
fixed and are not included in the enumeration in article 415 of the new civil code are classified as personal or
movable property the classes of movable or personal property are the following one property not included in article
415 of the civil code for instance ships or vessels interest in a business two real property considered personal
property by special provision of law growing fix growing fruits are considered immovable under article 415 paragraph
2 but are recognized as personal property under the chattel mortgage law and thus may be the object of chattel
mortgage a machinery placed on a tenement by the leases or use refractory who did not act as the agent of the
tenement owner is personal property three forces of nature which are brought under control by science such as gas
and electricity four in general all movable things that can be transported from place to place without impairment of the
real property to which they are fixed five obligations and actions which have for their object movables or demandable
sums six shares of stocks of agricultural commercial and industrial entities although they may have real estate

seven obligations and actions these are real personal rights material rights are called corporeal property incorporeal
property refer to rights

then shares of stocks personal property which can be the subject matter of a charter mortgage and other incorporeal
personal property for instance intellectual property such as copyrights patents or trademarks article 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 others a
consumable is a movable which cannot be used in a manner appropriate to its nature without itself being consumed
while a non-consumable is a movable which can be used in a manner appropriate to its nature without itself being
consumed the classification of classification applies to movables and to corporeal objects only in relation to
comodatum under article 1933 and 1936 of the civil code consumable goods cannot be the subject matter of a
contract of comadatum unless the purpose of the contract is not the consumption of the object as when it is merely
for exhibition mutum or simple loan the subject matter is money or other consumable thing article 1933 use of rock
should not include those which are consumed when used article 562 and article 5 7 3 of the civil code

and lastly fungibles and non-fungibles fungible can be substituted by another thing of the same kind quantity and
quality example money while non-fungible if not replaceable in such equivalence