digested-cases4.2.doc

7/23/2019 DIGESTED-CASES4.2.doc

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BACHRACH VS. SEIFERT

Facts:

The deceased E. M. Bachrach, who left no forced heir except his widow Mary McDonald Bachrach, in his last will and

testament made various legacies in cash and willed the remainder of his estate. The estate of E. M. Bachrach, as owner

of !",!!! shares of stoc# of the $to#%Big &edge Mining 'o., (nc., received from the latter )*,!!! shares representing )!

per cent stoc# dividend on the said !",!!! shares. +n une !, -*", Mary McDonald Bachrach, as usufructuary or life

tenant of the estate, petitioned the lower court to authorie the /eoples Ban# and Trust 'ompany, as administrator of theestate of E. M. Bachrach, to transfer to her the said )*,!!! shares of stoc# dividend 0y indorsing and delivering to her the

corresponding certificate of stoc#, claiming that said dividend, although paid out in the form of stoc#, is fruit or income and

therefore 0elonged to her as usufructuary or life tenant. 1ophie 1iefert and Elisa Elianoff, legal heirs of the deceased,

opposed said petition on the ground that the stoc# dividend in 2uestion was not income 0ut formed part of the capital and

therefore 0elonged not to the usufructuary 0ut to the remainderman. &hile appellants admit that a cash dividend is an

income, they contend that a stoc# dividend is not, 0ut merely represents an addition to the invested capital.

(ssue:

&hether or not a dividend is an income and whether it should go to the usufructuary.

3eld:

The usufructuary shall 0e entitled to receive all the natural, industrial, and civil fruits of the property in usufruct. The

!",!!! shares of stoc# are part of the property in usufruct. The )*,!!! shares of stoc# dividend are civil fruits of the

original investment. They represent profits, and the delivery of the certificate of stoc# covering said dividend is e2uivalent

to the payment of said profits. 1aid shares may 0e sold independently of the original shares, 4ust as the offspring of a

domestic animal may 0e sold independently of its mother. (f the dividend 0e in fact a profit, although declared in stoc#, it

should 0e held to 0e income. $ dividend, whether in the form of cash or stoc#, is income and, conse2uently, should go to

the usufructuary, ta#ing into consideration that a stoc# dividend as well as a cash dividend can 0e declared only out of

profits of the corporation, for if it were declared out of the capital it would 0e a serious violation of the law.

5nder the Massachusetts rule, a stoc# dividend is considered part of the capital and 0elongs to the remainderman6 while

under the /ennsylvania rule, all earnings of a corporation, when declared as dividends in whatever form, made during the

lifetime of the usufructuary, 0elong to the latter. The /ennsylvania rule is more in accord with our statutory laws than the

Massachusetts rule.

BACHRACH VS TALISAY SILAY

Facts: +n 77 Decem0er -78, the Talisay%1ilay Milling 'o., (nc., was inde0ted to the /9B. To secure the payment of its

de0t, it succeeded in inducing its planters, among whom was Mariano acson edesma, to mortgage their land to the

0an#. $nd in order to compensate those planters for the ris# they were running with their property under that mortgage,

the aforesaid central, 0y a resolution passed on the same date, and amended on 78 March -7", undertoo# to credit the

owners of the plantation thus mortgaged every year with a sum e2ual to 7; of the de0t secured according to the yearly0alance, the payment of the 0onus 0eing made at once, or in part from time to time, as soon as the central 0ecame free of

its o0ligations to the 0an#, and of those contracted 0y virtue of the contract of supervision, and had funds which might 0e

so used, or as soon as it o0tained from said 0an# authority to ma#e such payment.

Bachrach Motor 'o., (nc. filed a complaint against the Talisay%1ilay Milling 'o., (nc., for the delivery of the amount of

/8,")! or promissory notes or other instruments of credit for that sum paya0le on 8! une -8!, as 0onus in favor of

Mariano acson edesma. The complaint further prays that the sugar central 0e ordered to render an accounting of the

amounts it owes Mariano acson edesma 0y way of 0onus, dividends, or otherwise, and to pay Bachrach Motors a sum

sufficient to satisfy the 4udgment mentioned in the complaint, and that the sale made 0y said Mariano acson edesma 0e

declared null and void. The /9B filed a third

party claim alleging a preferential right to receive any amount which Mariano acson edesma might 0e entitled from

Talisay%1ilay Milling as 0onus. Talisay%1ilay answered the complaint that Mariano acson edesma,)!!?

0elonged to 'esar edesma 0ecause he had purchase it. 'esar edesma claimed to 0e an owner 0y purchase in good

faith. $t the trial all the parties agreed to recognie and respect the sale made in favor of 'esar edesma of the />,)!!

part of the credit in 2uestion, for which reason the trial court dismissed the complaint and cross%complaint against 'esar

edesma authoriing the central to deliver to him the sum of />,)!!. $nd upon conclusion of the hearing, the court held

that the Bachrach Motor 'o., (nc., had a preferred right to receive the amount of /,!>@.!7 which was Mariano acson

edesma


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The 1upreme 'ourt affirmed the 4udgment appealed from, as it found no merit in the appeal6, without express finding as to

costs.

1. Civil Fruits under Article 355 of the Civil Code

$rticle 8)) of the 'ivil 'ode considers three things as civil fruits: First, the rents of 0uildings6

second, the proceeds from leases of lands6 and, third, the income from perpetual or life annuities, or other similar sources

of revenue. $ccording to the context of the law, the phrase Au otras analogas refers only to rents or income, for the

ad4ectives Aotras and Aanalogas agree with the noun Arentas, as do also the other ad4ectives Aperpetuas and Avitalicias.The Acivil fruits the 'ivil 'ode understands one of three and only three things, to wit: the rent of a 0uilding, the rent of

land, and certain #inds of income.

2. Bonus not a civil fruit; not an income of the land

The amount of the 0onus, according to the resolution of the central granting it, is not 0ased upon the value, importance or

any other circumstance of the mortgaged property, 0ut upon the total value of the de0t there0y secured, according to the

annual 0alance, which is something 2uite distinct from and independent of the property referred to. $s the 0onus is not

o0tained from the land, it is not civil fruits of that land. (t is neither rent of 0uildings, proceeds from lease of lands, or

income under $rticle 8)) of the 'ivil 'ode.

BERNARDO v BATACLAN (1938; Laurel)FACTS: Plaintif Vicente Bernardo acquired a parcel o land rom Pastor Samonte thru a contract o sale

!hereater" Bernardo instituted a case a#ainst said $endor to secure possession o the land Bernardo %asa&le to o&tain a a$ora&le decision rom the court !he plaintif ound the deendant herein" 'atalinoBataclan" in the said premises t appears that he has &een authoried &* ormer o%ners" as ar &ac+ as19,," to clear the land and ma+e impro$ements thereon !hus" plaintif instituted a case a#ainst Bataclanin the 'ourt o -irst nstance o 'a$ite n this case" plaintif %as declared the o%ner o the land &ut thedeendant %as held to &e a possessor in #ood aith" entitled to reim&ursement in the total sum o P1"./,"or %or+ done and impro$ements made Both parties appealed the decision

!he court thereater made some modi0cations &* allo%in# the deendant to reco$er compensationamountin# to P,",1, and &* reducin# the price at %hich the plaintif could require the deendant topurchase the land in question rom P3 do%n to P, per hectare Plaintif %as li+e%ise #i$en 3 da*srom the date %hen the decision &ecame 0nal to e2ercise his option" either to sell the land to thedefendant or to buy the imrovements from him n 4anuar* 9" 193/" the plaintif con$e*ed to thecourt his desire !to re"uire the defendant to ay him the value of the land at the rate of #$%%er he&tare or a total ri&e of #'()%%% for the *hole tra&t of land+!!he deendant indicated thathe %as unable to ay the landand" on 4anuar* ,/" 193/" an order %as issued #i$in# the plaintif 3 da*s%ithin %hich to pa* the deendant the sum o P,",1,Su&sequentl*" on 5pril ,/" 193/" the court &elo%" at the instance o the plaintif and %ithout o&6ection onthe part o the deendant" ordered the sale o the land in question at pu&lic auction !he land %as sold on5pril 7" 1937 to !ori&io !eodoro or P8"

,SS-E: .ON DEFENDANT BATACLAN ,S ST,LL ENT,TLED TO RECO/ER T0E CO-RT 1ANDATEDCO1#ENSAT,ON AR,S,N2 FRO1 T0E SALE OF T0E #RO#ERT3 TO TOR,B,O

L: ict o ri#hts arises &et%een the o%ners and it &ecomes necessar* to protect the o%ner o the

impro$ements %ithout causin# in6ustice to the o%ner o the land !he la% pro$ided a 6ust and equita&lesolution &* #i$in# the o%ner o the land the option to acquire the impro$ements ater pa*ment o theproper indemnit* or to o&li#e the &uilder or planter to pa* or the land and the so%er to pa* the properrent n this case" the plaintif" as o%ner o the land" chose to require the deendant" as o%ner o theimpro$ements to pa* or the land

!he deendant a$ers that 4he is a ossessor in 5ood faith and that the amount of #$)$'$ to *hi&hhe is entitled has not yet been aid to him+6:eendant urther claims that he has a ri#ht to retainthe land in accordance %ith the pro$isions o article /73 o the 'i$il 'ode ?hile the said ar#ument isle#all* tena&le" the same must perorce &e denied &ecause deendant Bataclan has lost his ri#ht oretention as he ailed to pa* or the land 4The la*) as *e have already said) re"uires no more thanthat the o*ner of the land should &hoose bet*een indemnifyin5 the o*ner of theimrovements or re"uirin5 the latter to ay for the land6+

,2NAC,O v 0,LAR,O (19/.; =oran)Facts:lias ilario and his %ie :ionisia :res 0led a complaint a#ainst :amian" -rancisco and Luis #nacioconcernin# the o%nership o a parcel o land" partl* rice@land and partl* residential 5ter the trial o thecase" the lo%er court under 4ud#e 5lonso -eli2" rendered 6ud#ment holdin# ilario and :res as the le#alo%ners o the %hole propert* &ut concedin# to the #nacios the o%nership o the houses and #ranaries&uilt &* them on the residential portion %ith the ri#hts o a possessor in #ood aith" in accordance %itharticle 3.1 o the 'i$il 'ode

Su&sequentl*" in a motion 0led in the same '- (no% handled &* respondent 4ud#e on -elipe


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structure at their o%n e2pense and to restore ilario and :res in the possession o said lot 5ter hearin#"the motion %as #ranted &* 4ud#e


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:epra then 0led a 'omplaint or Iuietin# o !itle a#ainst :umlao" the latter admitted the encroachment&ut alle#ed" that the present suit us &arred &* res 6udicate &* $irtue o the decision o the =unicipal 'ourt

:PF5 claims that the :ecision o the =unicipal 'ourt %as null and $oid a& initio &ecause its 6urisdiction islimited to the sole issue o possession" %hereas decisions afectin# lease" %hich is an encum&rance on realpropert*" ma* onl* &e rendered &* 'ourts o -irst nstance

ssue

?hether or not the =unicipal 'ourtHs decision %as null and $oid a& initio &ecause it has no 6urisdictiono$er the caseJ

?hether or not the actual situations o :=L5 and :PF5 conorm to the 6uridical positionsrespecti$el* de0ned &* la%" or a C&uilder in #ood aithC under 5rticle //8" a Cpossessor in #ood aithCunder 5rticle 7,. and a Clando%ner in #ood aithK under 5rticle //8J

eld

5ddressin# out sel$es to the issue o $alidit* o the :ecision o the=unicipal 'ourt" %e hold the same to &e null and $oid !he 6ud#ment in a detainer case is efecti$e inrespect o possession onl* (Sec G" Fule G" Fules o 'ourt) !he =unicipal 'ourt o$er@stepped its &ounds%hen it imposed upon the parties a situation o Corced leaseC" %hich li+e Corced co@o%nershipC is nota$ored in la% -urthermore" a lease is an interest in real propert*" 6urisdiction o$er %hich &elon#s to 'ourtso -irst nstance (no% Fe#ional !rial 'ourts) (Sec //(&)" 4udiciar* 5ct o 19/8; Sec 19 (,) Batas Pam&ansaBl# 1,9) Since the =unicipal 'ourt" acted %ithout 6urisdiction" its :ecision %as null and $oid and cannotoperate as res 6udicata to the su&6ect complaint or Iuetin# o !itle Besides" e$en i the :ecision %ere$alid" the rule on res 6udicata %ould not appl* due to diference in cause o action n the =unicipal 'ourt"the cause o action %as the depri$ation o possession" %hile in the action to quiet title" the cause o action%as &ased on o%nership -urthermore" Sec G" Fule G o the Fules o 'ourt e2plicitl* pro$ides that

6ud#ment in a detainer case Cshall not &ar an action &et%een the same parties respectin# title to the landC

5F! //8 !he o%ner o the land on %hich an*thin# has &een &uilt so%n or planted in #ood aith"

shall ha$e the ri#ht

to appropriate as his o%n the %or+s" so%in# or plantin#" ater pa*ment o the indemnit* pro$ided or inarticles 7/. and 7/8" or

to o&li#e the one %ho &uilt or planted to pa* the price o the land" and the one %ho so%ed" the proper rent

o%e$er" the &uilder or planter cannot &e o&li#ed to &u* the land i its $alue is considera&l* more thanthat o the &uildin# or trees n such case" he shall pa* reasona&le rent" i the o%ner o the land does notchoose to appropriate the &uildin# or trees ater proper indemnit* !he parties shall a#ree upon the termso the lease and in case o disa#reement" the court shall 02 the terms thereo (Para#raphin# supplied)

Pursuant to the ore#oin# pro$ision" :PF5 has the option either to pa* or the encroachin# part o:=L5Ks +itchen" or to sell the encroached 3/ square meters o his lot to :=L5 e cannot reuse topa* or the encroachin# part o the &uildin#" and to sell the encroached part o his land" 7 as he had

maniested &eore the =unicipal 'ourt But that maniestation is not &indin# &ecause it %as made in a $oidproceedin#

o%e$er" the #ood aith o :=L5 is part o the Stipulation o -acts in the 'ourt o -irst nstance t %asthus error or the !rial 'ourt to ha$e ruled that :PF5 is Centitled to possession"C %ithout more" o thedisputed portion impl*in# there&* that he is entitled to ha$e the +itchen remo$ed e is entitled to suchremo$al onl* %hen" ater ha$in# chosen to sell his encroached land" :=L5 ails to pa* or the same . nthis case" :=L5 had e2pressed his %illin#ness to pa* or the land" &ut :PF5 reused to sell

SAR1,ENTO /+ A2ANA'$= SCRA '$$FACTS:

?hile rnesto Valentino %as still courtin# his %ie" latterHs mother ofered a lot or the construction ohouse &* the spouses t %as assumed that the %ieHs mother %as the o%ner o the land" %hich %oulde$entuall* transer to the spouses t turned out that Sarmiento %as the o%ner o the land Sarmiento 0ledan e6ectment suit to %hich the trial court ound out that the spouses are possessors in #ood aith andordered Sarmiento to e2ercise option &ased on 5rt //8 Sarmiento did not e2ercise an* o the options !hespouses then consi#ned the amount in court

SS ?hether or not Sarmiento can reuse to e2ercise the #i$en options0ELD: Ne5ative+!he lando%ner cannot reuse &oth to appropriate or sell the land" and to compelthe &uilder to remo$e it rom the land on %hich it is located e is entitled to such demolition onl* %henater ha$in# chosen to sell the land" the other part* ails to pa* or the same


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Filiinas Colle5es ,n&+ vs+ 2ar&ia Timban5

-ilipinas 'olle#es %as declared to ha$e acquired the ri#hts o the spouses !im&an# and in considerationthereo" -ilipinas 'olle#es %as ordered to pa* the spouses P17"8G9 plus other amounts -ilipinas'olle#es %as required to deposit this to the court %ithin 9 da*s ater the decision shall ha$e &ecome 0nal

=ean%hile" =aria Eer$acio Blas %as declared to &e a &uilder in #ood aith o the school &uildin#constructed on the lot in question and entitled to &e paid the amount o P19" or it -ilipinas 'olle#es"purchaser o the said &uildin#" %as ordered to deli$er to Blas stoc+ certi0cate and pa* her P8",representin# the unpaid &alance o the purchase price o the house

-ilipinas 'olle#es ailed to pa* the said amounts Spouses !im&an# made +no%n to the court that the* hadchosen to compel -ilipinas 'olle#es to acquire the land and pa* them the $alue thereo !he spouses as+edor an order o e2ecution" %hich %as #ranted &* court =oreo$er" the le$ied on the house o the &uilder andthen sold the same in pu&lic auction

!he Sherif o =anila sold the &uildin# in pu&lic auction in a$or o the spouses !im&an# as the hi#hest&idders Personal properties o -ilipinas 'olle#es %ere also auctioned in a$or o the spouses

!he lo%er court declared the SherifHs certi0cate o sale co$erin# the school &uildin# null and $oid unless%ithin 17 da*s rom notice o said order" the successul &idders pa* Blas P7"G7 t also declared -ilipinas'olle#es as the o%ner o undi$ided interest in Lot ,@1 on %hich the &uildin# sold in the auction sale issituated and ordered the sale in pu&lic auction o said undi$ided interest o the -ilipinas 'olle#es in a$or oBlas and a#ainst -ilipinas 'olle#es

!he appellant spouses posited that &ecause the &uilder in #ood aith has ailed to pa* the price o the landater the o%ners thereo e2ercised their option under 5rt //8" the &uilder lost his ri#ht o retentionpro$ided in 5rt 7/. and &* operation o 5rt //7" the appellants as o%ners o the land automaticall*&ecame the o%ners o the &uildin#

SS ?hether or not the contention o the appellants are $alid

FL


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!he plaintifHs protest %as in$esti#ated upon &ut his claim %as not #i$en due course n appeal"respondent court rules that hal o the portion o land should &e #i$en to the deendant" &ein# thesuccessul &idder !he other hal should &e a%arded to Oamora %ithout pre6udice to the ri#ht o rti toparticipate in the pu&lic &iddin# o the lot rti is to &e not declared the successul &idder" deendantsshould reim&urse 6ointl* said plaintif or the impro$ements introduced on the land" %ith him" ha$in# theri#ht to retain the propert* until ater he has &een paid or

Plaintif appealed the 6ud#ment t %as later ound out that rti collected tolls on a portion o the propert*%herein he has not introduced an* impro$ement

!he 6ud#ment &ecame 0nal and e2ecutor* Pri$ate respondents 0led a motion or its e2ecution requestin#that the* 0le a &ond in lieu o the amount that should &e paid to rti" on the condition that ater theaccountin# o the tolls collected &* plaintif" there is still and amount due and pa*a&le to the said plaintif"the &ond shall &e held ans%era&le

Petitioner thus 0led the instant petition" contendin# that in ha$in# issued the rder and ?rit o 2ecution"respondent 'ourt Cacted %ithout or in e2cess o 6urisdiction" andor %ith #ra$e a&use o discretion" &ecausethe said order and %rit in efect $ar* the terms o the 6ud#ment the* purportedl* see+ to enorceC ear#ued that since said 6ud#ment declared the petitioner a possessor in #ood aith" he is entitled to thepa*ment o the $alue o the impro$ements introduced &* him on the %hole propert*" %ith ri#ht to retainthe land until he has &een ull* paid such $alue e li+e%ise a$erred that no pa*ment or impro$ementshas &een made and" instead" a &ond thereor had &een 0led &* deendants (pri$ate respondents)" %hich"accordin# to petitioner" is not the pa*ment en$isa#ed in the decision %hich %ould entitle pri$aterespondents to the possession o the propert* -urthermore" %ith respect to portion CBC" petitioner alle#esthat" under the decision" he has the ri#ht to retain the same until ater he has participated and lost in thepu&lic &iddin# o the land to &e conducted &* the Bureau o Lands t is claimed that it is onl* in the e$entthat he loses in the &iddin# that he can &e le#all* dispossessed thereo

t is the position o petitioner that all the ruits o the propert*" includin# the tolls collected &* him rom thepassin# $ehicles" %hich accordin# to the trial court amounts to P,7"" &elon#s to petitioner and notto deendantpri$ate respondent Iuirino 'omintan" in accordance %ith the decision itsel" %hich decreedthat the ruits o the propert* shall &e in lieu o interest on the amount to &e paid to petitioner asreim&ursement or impro$ements 5n* contrar* opinion" in his $ie%" %ould &e tantamount to anamendment o a decision %hich has lon# &ecome 0nal and e2ecutor* and" thereore" cannot &e la%ull*done

!he issue decisi$e o the contro$er* isQater the rendition &* the trial court o its 6ud#ment in 'i$il 'ase


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FLORE@A v E/AN2EL,STA9. S'F5 13 (-e&ruar* ,1" 198)M


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e2clusi$el* &elon#s to another &ut o %hich he is a co@o%ner !he co@o%ner is not a third person under thecircumstances" and the situation is #o$erned &* the rules o co@o%nership

o%e$er" %hen" as in this case" the co@o%nership is terminated &* the partition and it appears that thehouse o deendants o$erlaps or occupies a portion o 7 square meters o the land pertainin# to plaintifs%hich the deendants o&$iousl* &uilt in #ood aith" then the pro$isions o 5rticle //8 o the ne% 'i$il 'odeshould appl* =anresa and


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ordered the o%ner o the land" petitioner -lorencio" to sell to pri$ate respondents" 4uan and sidro" the parto the land the* intruded upon" there&* depri$in# petitioner o his ri#ht to choose Such rulin# contra$enedthe e2plicit pro$isions o 5rticle //8 to the efect that C(t)he o%ner o the land shall ha$e the ri#ht toappropriate or to o&li#e the one %ho &uilt to pa* the price o the land C !he la% is clear andunam&i#uous %hen it coners the ri#ht o choice upon the lando%ner and not upon the &uilder and thecourts

!hus" in *uemuel vs+laes" the 'ourt cate#oricall* ruled that the ri#ht to appropriate the %or+s orimpro$ements or to o&li#e the &uilder to pa* the price o the land &elon#s to the lando%ner

#ECSON /S+ CO-RT OF A##EALS

-5'!S Pecson %as the o%ner o a commercial lot on %hich he &uilt a our@door store*@apartment &uildin#-or his ailure to pa* realt* ta2es" the lot %as sold at pu&lic auction %ho in turn sold it to the pri$aterespondents Petitioner challen#es the $alidit* o the auction sale

SS ?hether or not 5rt //8 0nds application in the said case

FL


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SS ?hether or not pri$ate respondent has the option o e2ercisin# the alternati$e choice o sta*in# inthe disputed land

FL

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