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The Zobel family of Spain formerly owned vast track of

marshland in the municipality of Macabebe, Pampanga province.

Called Hacienda San Esteban, it was administered and managed

by the Ayala y Cia. Ayala y Cia devoted the hacienda to the

planting and cultivation of nipa palms from which it gathered

nipa sap or "tuba." It operated a distillery plant in barrio San

Esteban to turn nipa tuba into potable alcohol which was in turn

manufactured into liquor.

Accessibility through the nipa palms deep into the hacienda

posed as a problem. Ayala y Cia., therefore dug canals leading

towards the hacienda's interior where most of them interlinked

with each other. The canals facilitated the gathering of tuba and

the guarding and patrolling of the hacienda by security guards

called "arundines." By the gradual process of erosion these

canals acquired the characteristics and dimensions of rivers.

Ayala y Cia shifted from the business of alcohol production to

bangus culture. It converted Hacienda San Esteban from a forest

of nipa groves to a web of fishponds. Then Ayala y Cia sold a

portion of Hacienda San Esteban to Roman Santos who also

transformed the swamp land into a fishpond. In so doing, heclosed and built dikes across 6 streams namely Sapang

Malauling Maragul, Quiorang Silab, Pepangebunan, Bulacus,

Nigui and Nasi.

The closing of the man-made canals in Hacienda San Esteban

drew complaints from residents of the surrounding communities.

Claiming that the closing of the canals caused floods during the

rainy season, and that it deprived them of their means of

transportation and fishing grounds, said residents demanded re-

opening of those canals. Subsequently, Mayor Lazaro Yambao of

Macabebe, accompanied by policemen and some residents went

to Hacienda San Esteban and opened the closure dikes.

Whereupon, Roman Santos filed Civil Case in the Court of Firstnstance of Pampanga which preliminarily enjoined Mayor

Yambao and others from demolishing the dikes across the

canals. The municipal officials of Macabebe countered by filing a

complaint in the same court. The CFI Pampanga rendered

udgment in both cases against Roman Santos who immediately

elevated the case to the Supreme Court.

n the meantime, the Secretary of Commerce and

closed by Roman Santos were natural floatable

orial. However the said official later revoked his

Subsequently, upon

authority granted under Act 3982 the Secretary of Commerce and

Communications entered into a contract with Roman Santos

whereby the former recognized the private ownership of 6

streams and the latter turned over for public use 2 artificial

canals and bound himself to maintain them in navigable state.

The Provincial Board of Pampanga and the municipal councils of

Macabebe and Masantol objected to the contract. However, the

Secretary of Justice, upheld its legality. Roman Santos withdraw

his appeals in the Supreme Court.

After few years, the municipality of Macabebe and the Zobel

family executed an agreement whereby they recognized the

nature of the streams mentioned in the report of Panopio, the

surveyor in the office of Director of Land, as public or private,

depending on the findings in said report. This agreement was

approved by the Secretary of Public Works and Communicatio

and confirmed the next day by the municipal council of

Macabebe. A few months later, the Secretary of Justice issue

an opinion holding that the contract executed by the Zobel fam

and the municipality of Macabebe has no validity for two

reasons, namely, (1) the streams although originally dug by

Ayala y Cia., lost their private nature by prescription inasmuch

the public was allowed to use them for navigation and fishing

and (2) at the time the Secretary of Commerce and

Communications approved the said contract, he had no more

power so to do, because such power under Sec. 2 of Act 215

was revoked by the amending Act 4175. Despite the ruling of

Secretary of Justice, the streams in question remained closed

Administrative investigations were again conducted by various

agencies of the Executive branch of our government culminat

in an order of President Manuel Quezon immediately before th

national elections in 1941 requiring the opening of some of th

streams. Said streams were again closed in 1942 allegedly up

order of President Quezon.

Roman Santos acquired in 1940 from the Zobel family a large

portion of Hacienda San Esteban wherein are located 25 strea

which were closed by Ayala y Cia. 18 years later, Congress

enacted Republic Act No. 2056 - Senator de la Rosa requeste

in writing the Secretary of Public Works and communications t

proceed in pursuance of Republic Act No. 2056 against fishpo

owners in the province of Pampanga who have closed rivers a

appropriated them as fishponds without color of title. On the

same day, Benigno Musni and other residents in the vicinity of

Hacienda San Esteban petitioned the Secretary of Public Work

and Communications to open several streams including those

the Hacienda.

The Secretary of Public Works and Communications rendered

decisions ordering the opening and restoration of the channel

all the streams in controversy except those streams where Aya

y Cia built dikes, within 30 days on the ground that said stream

belong to the public domain.

After receipt of the Secretary's decision, Roman Santos filed

motion with the Court of First Instance for junction against the

Secretary of Public Works and Communications and Julian C.

Cargullo. As prayed for preliminary injunction was granted.

Roman Santos received the decision of the Secretary of PubliWorks and Communications. Consequently, he asked the cou

to cite in contempt Secretary Florendo Moreno, Undersecreta

M.D. Bautista and Julian Cargullo for issuing and serving upon

him the said decisions despite the existence of the preliminary

injunction. The trial court ruled that Secretary Florencio Moren

Undersecretary M.D. Bautista and Julian Cargullo acted in goo

faith and hence, they were merely "admonished to desist from

any and further action in this case, observe the preliminary

injunction issued by this Court, with the stern warning, howeve

that a repetition of the acts complained of shall be dealt with

severely. The trial court declared all the streams under litigatio

private, and made the writ of preliminary injunction permanen


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The Secretary of Public Works and Communication and Julian

Cargullo appealed to this Court from the order of July 17, 1959

ssued in connection with Roman Santos' motion for contempt

and from the decision of the lower court on the merits of the

case.

ssue: the streams involved in this case belong to the public

domain or to the owner of Hacienda San Esteban

Held:

Sec. 1 of RA 2056 the construction or building of dams, dikes

or any other works which encroaches into any public navigable

river, stream, coastal waters and any other navigable public

waters or waterways as well as the construction or building of

dams, dikes or any other works in areas declared as communal

fishing grounds, shall be ordered removed as public nuisances or

as prohibited constructions as herein provided

Respondent Bautista vs Alarcon, No private persons has right to

usurp possession of a watercourse, branch of a river, or lake of

the public domain and use, unless it shall have been proved that

he constructed the same within in property of his exclusive

ownership, and such usurpation constitutes a violation of theegal provisions which explicity exclude such waterways from the

exclusive use or possession of a private party. (Emphasis

supplied)

A private person may take possession of a watercourse if he

constructed the same within his property. This puts Us into

nquiry whether the streams in question are natural or artificial.

One and all, the evidence, oral and documentary, presented by

Roman Santos in the administrative proceedings supports the

conclusion of the lower court that the streams involved in this

case were originally man-made canals constructed by the former

owners of Hacienda San Esteban and that said streams were not

held open for public use. This same conclusion was reached 27

years earlier by an investigator of the Bureau of Public Works

whose report and recommendations were approved by the

Director of Public Works and submitted to the Secretary of

Commerce and Communications.

The spouses Romeo Martinez and Leonor Suarez, now

petitioners-appellees, are the registered owners of two (2)parcels of land located in Lubao, Pampanga. Both parcels of

and are fishponds. The property involved in the instant case is

the second parcel.

The disputed property was originally owned by one Paulino

Montemayor, who secured a "titulo real" over it way back in

1883. After the death of Paulino Montemayor the said property

passed to his successors-in-interest, Maria Montemayor and

Donata Montemayor, who in turn, sold it, as well as the first

parcel, to a certain Potenciano Garcia.

Because Potenciano Garcia was prevented by the then munic

president of Lubao, Pedro Beltran, from restoring the dikes

constructed on the contested property, the former, filed Civil

Case with the Court of First Instance against the said Pedro

Beltran to restrain the latter in his official capacity from moles

him in the possession of said second parcel, and on even dat

applied for a writ of preliminary injunction, which was issued

against said municipal president. The Court declared permane

the preliminary injunction, which, decision, on appeal, was

affirmed by the Supreme Court. the dikes around the property

question remained closed until a portion thereof was again

opened just before the outbreak of the Pacific War.

Potenciano Garcia applied for the registration of both parcels

land in his name, which was granted despite the opposition o

Atty-general and Director of Land. Original certificate of title

covering said parcels 1 and 2 was issued to the spouses

Potenciano Garcia and Lorenza Sioson.

These parcels of land were subsequently bought by Emilio Cru

de Dios in whose name transfer certificate of title No. 1421 w

first issued.

Thereafter, the ownership of these properties changed handsuntil eventually they were acquired by the herein appellee

spouses who hold them by virtue of transfer certificate of title

15856.

To avoid any untoward incident, the disputants agreed to refe

the matter to the Committee on Rivers and Streams, In the re

submitted to the Committee on Rivers and Streams to the effe

that Parcel No. 2 of transfer certificate of title No. 15856 was

a public river but a private fishpond owned by the herein

spouses.

The Committee on Rivers and Streams rendered a decision

recognizing the ownership of the spouses of the creeks whichforms part of their registered land but the municipal officials o

Lubao refuse to recognize said decision. spouses Romeo

Martinez and Leonor Suarez instituted Civil Case before the Co

of First Instance of Pampanga against Mayor Zagad, praying

the latter be enjoined from molesting them in their possession

their property and in the construction of the dikes therein. The

writ of preliminary injunction applied for was issued against th

respondent municipal Mayor, who immediately elevated the

injunction suit for review to the Supreme Court, which dismiss

Mayor Zagad's petition. With this dismissal order herein appel

spouses proceeded to construct the dikes in the disputed par

of land.

Some four (4) years later, the Honorable Florencio Moreno, th

Secretary of Public Works and Communications, ordered anot

investigation of the said parcel of land, directing the appellees

herein to remove the dikes they had constructed, on the streng

of the authority vested in him by Republic Act No. 2056, entitl

"An Act To Prohibit, Remove and/or Demolish the Constructio

of Dams. Dikes, Or Any Other Walls In Public Navigable Wate

Or Waterways and In Communal Fishing Grounds, To Regulate

Works in Such Waters or Waterways And In Communal Fishing

Grounds, And To Provide Penalties For Its Violation, And For

Other Purposes.


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Spouses Martinez by commencing an action opposing said

order. The lower court ruled in favor of them recognizing their

ownership of the land in question and issuing preliminary

njunction that the Sec. Of Public Works be enjoined from

molesting the property of the spouses. However, CA reversed

this decision dissolving the injunction issued by the Court and

cancelling the registration of Lot No. 2, the disputed area, and

ordering its reconveyance to the public domain

SSUE:

WON COURT OF APPEALS ERRED IN DECLARING IN THE

NSTANT CASE THAT PARCEL NO. 2 OF TRANSFER

CERTIFICATE OF TITLE NO. 15856 IS A PUBLIC RIVER AND

ORDERING THE CANCELLATION OF ITS REGISTRATION

BECAUSE THIS CONSTITUTES A COLLATERAL ATTACK ON A

TORRENS TITLE IN VIOLATION OF THE LAW AND THE WELL-

SETTLED JURISPRUDENCE ON THE MATTER.

At the time of the enactment of Section 496, one right

recognized or existing under the law is that provided for in Article

339 of the old Civil Code which reads as follows:

Property of public ownership is:

1. That destined to the public use, such as roads, canals, rivers,

torrents, ports, and bridges constructed by the State, and banks

shores, roadsteads, and that of a similar character. (Par. 1)

The above-mentioned properties are parts of the public domain

ntended for public use, are outside the commerce of men and,

therefore, not subject to private appropriation

The Land Registration Court has no jurisdiction over non-

registerable properties, such as public navigable rivers which are

parts of the public domain, and cannot validly adjudge the

registration of title in favor of a private applicant. Hence, the

udgment of the Court of First Instance of Pampanga as regards

the Lot No. 2 of Certificate of Title No. 15856 in the name of

petitioners-appellants may be attacked at any time, either

directly or collaterally, by the State which is not bound by any

prescriptive period provided for by the Statute of Limitations

(Article 1108, par. 4, new Civil Code). The right of reversion or

reconveyance to the State of the public properties fraudulently

registered and which are not capable of private appropriation or

private acquisition does not prescribe.

As held by the Court of First Instance of Pampanga for injunction

filed by the petitioners' predecessors-in-interest against theMunicipal Mayor of Lubao and decided in 1916, Lot No. 2 is a

branch of the main river that has been covered with water since

time immemorial and, therefore, part of the public domain. This

finding having been affirmed by the Supreme Court, there is no

onger any doubt that Lot No. 2 of Transfer Certificate of Title

No. 15856 of petitioners is a river which is not capable of private

appropriation or acquisition by prescription.

Municipality of Cavity vs Rojas

: A parcel of land forming a part of the public plaza, named

Soledad, was leased to the defendants on which their house has

been constructed and had been occupying the same. The

plaintiff Municipality of Cavite thru the provincial fiscal, fi led a

complaint ordering the defendants to vacate the said land as

formed integral part of the public plaza as it has exclusive righ

control and administration over the streets, lanes, plazas, and

public places of the municipality. The defendants refused to

vacate the said land because they had acquired the right of

possession to it and further alleged that the lease agreement

provided that they can only be ordered to vacate the said

property if the municipality needed it for decoration or public u

which does not apply in the present case.

The trial court held that the municipality had no legal claim to

property. This case was appealed through bill of exceptions.

Issue: WON the lease agreement between the parties was vali

Ruling: The lease was null and void.

Ratio Decidendi: The defendant has no right to continue to

occupy the land for it is an integral part of the plaza which is f

public use and is reserved for the common benefit. Property f

public use in provinces and in towns comprises the provincial

and town roads, the squares, streets, fountains, and public

waters, the promenades, and public works of general service

supported by said towns or provinces.The said Plaza being a promenade for public use, the municip

council of Cavite could not in 1907 withdraw or exclude from

public use a portion thereof in order to lease it for the sole

benefit of the defendant Hilaria Rojas. The plaintiff municipali

exceeded its authority in the exercise of its powers by executin

contract over a thing of which it could not dispose, nor is it

empowered so to do. The Civil Code, articles 1271, prescribe

that everything which is not outside the commerce of man ma

be the object of a contract, and plazas and streets are outsid

this commerce. Therefore, it must be concluded that the said

lease is null and void.

Manila International Airport Authority vs CA

Facts:

Manila International Airport Authority (MIAA) is

operator of the Ninoy International Airport located at Parana

City. The Officers of Paranaque City sent notices to MIAA du

real estate tax delinquency. MIAA then settled some of

amount. When MIAA failed to settle the entire amount,

officers of Paranaque city threatened to levy and subject

auction the land and buildings of MIAA, which they did. M

sought for a Temporary Restraining Order from the CA but fa

to do so within the 60 days reglementary period, so the pet

was dismissed. MIAA then sought for the TRO with the Supre

Court a day before the public auction, MIAA was granted withTRO but unfortunately the TRO was received by the Parana

City officers 3 hours after the public auction.

MIAA admits that the MIAA Charter has placed the

to the Airport Lands and Buildings in the name of MI

However, MIAA points out that it cannot claim ownership o

these properties since the real owner of the Airport Lands

Buildings is the Republic of the Philippines. The MIAA Cha

mandates MIAA to devote the Airport Lands and Buildings for

benefit of the general public. Since the Airport Lands

Buildings are devoted to public use and public service,


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ownership of these properties remains with the State. The Airport

Lands and Buildings are thus inalienable and are not subject to

real estate tax by local governments. On the other hand, the

officers of Paranaque City Respondents invoke Section 193 of

the Local Government Code, which expressly withdrew the tax

exemption privileges of "government-owned and-controlled

corporations" upon the effectivity of the Local Government Code,

thus, MIAA cannot claim that the Airport Lands and Buildings are

exempt from real estate tax.

ssues:Whether or not MIAA is an instrumentality of the

government and not a government owned and controlled

corporation and as such exempted from tax.

Whether or not the land and buildings of MIAA are part

of the public dominion and thus cannot be the subject of levy

and auction sale.

Ruling:

MIAA's Airport Lands and Buildings are exempt from real estate

tax imposed by local governments.

First, MIAA is not a government-owned or controlled corporation

but an instrumentalityof the National Government and thus

exempt from local taxation. Second, the real properties of MIAA

are owned by the Republicof the Philippines and thus exempt

from real estate tax.

Under the Local government code, government owned

and controlled corporations are not exempted from real estate

tax. MIAA is not a government owned and controlled corporation,

for to become one MIAA should either be a stock or non stock

corporation. MIAA is not a stock corporation for its capital is not

divided into shares. It is not a non stock corporation since it hasno members. MIAA is a government instrumentality vested with

corporate powers to perform efficiently its governmental

functions. MIAA is like any other government instrumentality, the

only difference is that MIAA is vested with corporate powers.

Under Sec. 133(o) of Local Government Code, government

nstrumentalities are exempted from taxes.

The Airport Lands and Buildings of MIAA are property of

public dominion and therefore owned by the State or the

Republic of the Philippines. Under the civil code, property may

either be under public dominion or private ownership. Those

under public dominion are owned by the State and are utilized forpublic use, public service and for the development of national

wealth.

Those intended for public use, such as roads, canals, rivers,

torrents, ports and bridges constructed by the State, banks,

shores, roadsteads, and others of similar character

The ports included in the public dominion pertain either to

seaports or airports. When properties under public dominion

cease to be for public use and service, they form part of the

patrimonial property of the State.

The court held that the land and buildings of MIAA are

part of the public dominion. Since the airport is devoted for

public use, for the domestic and international travel

transportation. Even if MIAA charge fees, this is for support o

operation and for regulation and does not change the chara

of the land and buildings of MIAA as part of the public domin

As part of the public dominion the land and buildings of MIAA

outside the commerce of man. To subject them to levy

public auction is contrary to public policy. Unless the Presid

issues a proclamation withdrawing the airport land and buildi

from public use, these properties remain to be of pu

dominion and are inalienable. As long as the land and build

are for public use the ownership is with the Republic of Philippines.

Snchez vs Municipality of Asingan

Facts:

The Municipality of Asingan the owner of a triangular strip of

situated between the site of the municipal school building

the provincial road, measuring 42 x 26-1/2 x 46 meters. On

land appellants, with the knowledge and implied consent of

municipality, constructed temporary stores and buildings of

materials shortly after the end of the last war. Between 1952

1959 they paid rents to appellee. When a new loadministration took over the municipal council passed

resolution notifying the occupants of the land that the same

needed for certain public purposes, such as parking spa

expansion of school grounds, widening of the road and wa

area for pedestrians. Appellants were therefore advised to vac

on Instead of moving, however, appellants filed a petition

prohibition with the court a quo to prevent the municipality f

ejecting them from the land, with the alternative prayer

should they be ejected, appellee be ordered to reimburse

them the rents which they had paid, in the total sum

P1,178.20. After trial, the court dismissed the petition

ordered appellants to vacate the land.

Issue:

WON the appellants have the right to be reimbursed when they

ejected from the property of the Municipality.

Held:

Appellants claim the right to be reimbursed in case they shou

be ejected, and cite the case of Rojas v. Municipality of Cavite

30 Phil. 607, where this Court, after declaring null and void th

lease of a public plaza belonging to the said municipality and

ordering the lessee to vacate the same, ordered the municipa

to reimburse the rentals collected. It should be noted that whi

the property involved in that case was clearly devoted to publi

use, and therefore outside the commerce of man, and could

under any circumstance have been the object of a valid contra

of lease, appellee's position herein is that the land in question

patrimonial character, not being included in any of the catego

of municipal properties for public use enumerated in Article 42

of the Civil Code, namely: "municipal streets, squares, founta

public waters, promenades and public works for public service

said municipality." There is indeed nothing in the decision

appealed from or in the briefs of the parties to show that the l


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stood there from time immemorial and was in times past used as

a defense against the invasion of the Moros.

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