TITLE V. - PRESCRIPTION Chapter 1 - GENERAL PROVISIONS PDF

CIVIL CODE OF THE PHILIPPINES TITLE V. — PRESCRIPTION Chapter 1 GENERAL PROVISIONS Article 1106. By prescription, one acquires ownership and other real rights through the lapse of time in the manner and under the conditions laid down by law. In the same way, rights and actions are lost by prescrip- tion. COMMENT: (1) Deﬁnition of Prescription Prescription is a mode of acquiring (or losing) ownership and other real rights thru the lapse of time in the manner and under the conditions laid down by law, namely, that the posses- sion should be: (a) in the concept of an owner (b) public (c) peaceful (d) uninterrupted. (Arts. 1106, 1118, Civil Code). (e) adverse. In order that a possession may really be adverse, the claimant must clearly, deﬁnitely, and unequivocally notify the owner of his (the claimant’s) intention to avert an exclusive ownership in himself. (Clendenin v. Clendenin, 181 N.C. 465 and Director of Lands v. Abiertas, CA-GR 91-R, Mar. 13, 1947, 44 O.G. 923). 1 Art. 1106 CIVIL CODE OF THE PHILIPPINES (2) Proof Needed Because prescription is an extraordinary mode of acquiring ownership, all the essential ingredients, particularly the period of time, must be shown clearly. (Boyo v. Makabenta, CA-GR 7941-R, Nov. 24, 1952). (3) Reasons or Bases for Prescription (a) Economic necessity (otherwise, property rights would re- main unstable). Director of Lands, et al. v. Funtillar, et al. GR 68533, May 23, 1986 FACTS: Where the land sought to be registered was declared alienable and disposable 33 years ago, and is no longer a forest land, and the same has been possessed and cultivated by the applicants and their predecessors for at least three generations. HELD: The attempts of humble people to have disposable lands they have been tilling for generations titled in their names should not only be viewed with an understanding attitude but should, as a matter of policy, be encouraged. (b) Freedom from judicial harassment (occasioned by claims without basis). (c) Convenience in procedural matters (in certain instances, juridical proof is dispensed with). (d) Presumed abandonment or waiver (in view of the owner’s indifference or inaction). (4) Classiﬁcation of Prescription (a) as to whether rights are acquired or lost: 1) acquisitive prescription (prescription of ownership and other real rights). a) ordinary prescription b) extraordinary prescription 2 CIVIL CODE OF THE PHILIPPINES Art. 1106 2) extinctive prescription (“liberatory prescription;’’ pre- scription of actions); (“Statute of Limitations’’). (b) as to the object or subject matter: 1) prescription of property a) prescription of real property b) prescription of personal rights 2) prescription of rights (5) Laches Laches (or “estoppel by laches”) is unreasonable delay in the bringing of a cause of action before the courts of justice. Thus, if an action prescribes say in ten (10) years, it should be brought to court as soon as possible, without waiting for 8 or 9 years, unless the delay can be justiﬁably explained (as when there is a search for evidence). Note therefore, that while an action has not yet prescribed, it may no longer be brought to court because of laches. As deﬁned by the Supreme Court, “laches is failure or neglect, for an unreasonable and unexplained length of time, to do that which, by exercising due diligence, could or should have been done earlier; it is negligence or omission to assert a right within a reasonable time, warranting a presumption that the party entitled thereto either has abandoned it or declined to assert it. However, courts will not be bound by strictures of the statute of limitations or laches when manifest wrong or injuries would result thereby.” (Cristobal v. Melchor, 78 SCRA 175). Arradaza, et al. v. CA & Larrazabal GR 50422, Feb. 8, 1989 The principle of laches is a creation of equity. It is applied, not really to penalize neglect or sleeping upon one’s right, but rather to avoid recognizing a right when to do so would result in a clearly inequitable situation. (6) Rationale for Laches If a person fails to act as soon as possible in vindication of an alleged right, it is possible that the right does not really exist. 3 Art. 1106 CIVIL CODE OF THE PHILIPPINES (7) ‘Prescription’ Distinguished from ‘Laches’ Mapa III v. Guanzon 77 SCRA 387 While prescription is concerned with the FACT of delay, laches deals with the EFFECT of unreasonable delay. David v. Bandin GR 48322, Apr. 8, 1987 FACTS: A and B, husband and wife, died intestate, leaving two children, X and Y. X had been administering the property until her death in Feb. 15, 1955. Plaintiffs, the children of Y, were given their shares of the fruits of the property, though irregular and at times little, depending on the amount of the harvest. On April 23, 1963, plaintiffs, the children of Y, sent a letter of demand to the heirs of X for partition, and on June 14, 1963, or within a period of approximately 8 years from X’s death, ﬁled their complaint against X’s heirs. HELD: Plaintiffs cannot be held guilty of laches, nor is their claim barred by prescription. Plaintiffs were not guilty of negligence nor did they sleep on their rights. Prescription generally does not run in favor of a co-heir or co-owner as long as he expressly or impliedly recognizes the co- ownership. While implied or constructive trust prescribes in 10 years, the rule does not apply where a ﬁduciary relation exists and the trustee recognizes the trust. Gallardo v. Intermediate Appellate Court GR 67742, Oct. 29, 1987 In determining whether a delay in seeking to enforce a right constitutes laches, the existence of a conﬁdential relationship between the parties is an important circumstance for considera- tion. A delay under such circumstance is not as strictly regarded as where the parties are strangers to each other. The doctrine of laches is not strictly applied between near relatives, and the fact that parties are connected by ties of blood or marriage tends to excuse an otherwise unreasonable delay. 4 CIVIL CODE OF THE PHILIPPINES Art. 1106 Narciso Buenaventura & Maria Buenaventura v. CA & Manotok Realty, Inc. GR 50837, Dec. 28, 1992 The defense of laches applies independently of prescription. Laches is different from the statute of limitations. Prescription is concerned with the fact of delay, whereas laches is concerned with the effect of delay. Prescription is a matter of time; laches is principally a question of inequity of permitting a claim to be enforced, this inequity being founded on the same change in the condition of the property or the relation of the parties. Prescrip- tion is statutory; laches is not. Laches applies in equity, whereas prescription applies at law. Prescription is based on ﬁxed time; laches is not. (8) Constitutional Provision The right of the State to recover properties unlawfully acquired by public ofﬁcials or employees, from them or from their nominees or transferees, shall not be barred by prescrip- tion, laches, or estoppel. (Sec. 15, Art. XI, The 1987 Philippine Constitution). (9) Cases Republic v. Animas 56 SCRA 871 Prescription does not run against the State, especially be- cause the recovery of unlawfully acquired properties has become a State policy. Aldovino v. Alunan III 49 SCAD 340 (1994) Prescription must yield to the higher interest of justice. Francisco v. CA 122 SCRA 538 Philippine jurisprudence shows that the ﬁling of the com- plaint, even if merely for purposes of preliminary examination 5 Art. 1106 CIVIL CODE OF THE PHILIPPINES or investigation, suspends and interrupts the running of the prescriptive period. (10) Prescriptive Period on Registered Land covered by Tor- rens System Quirino Mateo & Matias v. Dorotea Diaz, et al. GR 137305, Jan. 17, 2002 FACTS: The land involved is registered under the Tor- rens system in the name of petitioners’ father Claro Mateo. There is no question raised with respect to the validity of the title. Immediately after petitioners discovered the existence of OCT 206 in 1977 or 1978, they took steps to assert their rights thereto. They divided the land between the two of them in an extrajudicial partition. Then petitioners ﬁled the case below to recover ownership and possession as the only surviving children of original owners, the late Claro Mateo. The Regional Trial Court (RTC), Bulacan, at Malolos, ruled that prescription and laches are applicable against petitioners, that real actions over an immovable prescribe after 30 years, that ownership can be acquired thru possession in good faith and with just title for a period of 10 years, and that ownership may be acquired thru uninterrupted adverse possession for 30 years without need of just title or of good faith. The Court of Appeals (CA) afﬁrmed that of the trial court, thus, this petition for review on certiorari. ISSUE: Whether or not the equitable doctrine of laches may override a provision of the Land Registration Act on impre- scriptibility of title to registered land. Otherwise put, the issue raised is whether prescription and the equitable principle of laches are applicable in derogation of the title of the registered owner. HELD: A party who had ﬁled immediately a case as soon as he discovered that the land in question was covered by a transfer certiﬁcate in the name of another person is not guilty of laches. (St. Peter Memorial Park, Inc. v. Cleofas, 92 SCRA 389 ). An action to recover possession of a registered land never prescribe in view of the provision of Sec. 44 of Act 496 (now 6 CIVIL CODE OF THE PHILIPPINES Art. 1106 Sec. 47 of PD 1529) to the effect that no title to registered land in derogation to that of a registered owner shall be acquired by prescription or adverse possession. (J.M. Tuason & Co. v. Aquirre, 7 SCRA 109 ). In fact, there is a host of jurisprudence that hold that pre- scription and laches could not apply to registered land covered by the Torrens system. (Bishop v. CA, 208 SCRA 636 and St. Peter Memorial Park, Inc. v. Cleofas, supra). With more reason are these principles applicable to laches, which is an equitable principle. Laches may not prevail against a speciﬁc provision of law, since equity, which has been deﬁned as “justice outside le- gality” is applied in the obscene of and not against statutory law or rules of procedure. (Causapin v. CA, 233 SCRA 615 ). Upon the other hand, the heirs of the registered owner are not estopped from claiming their father’s property, since they merely stepped into the shoes of the previous owners. Prescrip- tion is unavailing not only against the registered owner, but also against his hereditary successors because the latter merely step into the shoes of the decedent by operation of law and are merely the continuation of the personality of their predecessor- in-interest. (Teoﬁla de Guinoo v. CA [97 Phil. 235] and Gil Atun v. Eusebio Nuñez [97 Phil. 762]). The CA erred in ordering the Register of Deeds to cancel OCT 206 of Claro Mateo and issue new titles to those who are occupying the subject land. This violates the indefeasibility of a Torrens title. The title of Claro Mateo could be cancelled only if there is competent proof that he had transferred his rights over the parcel of land to another party, otherwise title would pass to his heirs only by testate or intestate succession. The fallo: The Supreme Court thereupon reverses the CA’s decision. In lieu thereof, the Court remands the case to the trial court for determination of the heirs of Claro Mateo in a proper proceeding. Far East Bank & Trust Co. v. Estrella O. Querimit GR 148582, Jan. 16, 2002 FACTS: Respondent deposited her savings with petitioner- bank. She did not withdraw her deposit even after maturity date 7 Art. 1106 CIVIL CODE OF THE PHILIPPINES of the certiﬁcates of deposit (CDs) precisely because she wanted to set it aside for her retirement, relying on the bank’s assur- ance, as reﬂected on the face of the instruments themselves, that interest would “accrue” or accumulate annually even after their maturity. Petitioner-bank failed to prove that it had already paid re- spondent, bearer and lawful holder of subject CDs, i.e., petitioner failed to prove that the CDs had been paid out of its funds, since evidence by respondent stands unrebutted that subject CDs until now remain unindorsed, undelivered, and unwithdrawn by her. ISSUE: Would it be unjust to allow the doctrine of laches to defeat the right of respondent to recover her savings which she deposited with the petitioner? HELD: Yes, it would be unjust not to allow respondent to recover her savings which she deposited with petitioner-bank. For one, Petitioner failed to exercise that degree of diligence required by the nature of its business. (Art. 1173). Because the business of banks is impressed with public interest, the degree of diligence required of banks is more than that of a good father of the family or of an ordinary business ﬁrm. The ﬁduciary nature of their relationship with their deposi- tors requires banks to treat accounts of their clients with the highest degree of care. (Canlas v. CA, 326 SCRA 415 ). A bank is under obligation to treat accounts of its depositors with meticulous care whether such accounts consist only of a few hundred pesos or of millions of pesos. Responsibility arising from negligence in the performance of every kind of obligation is demandable. (Prudential Bank v. CA, 328 SCRA 264 ). Petitioner failed to prove payment of the subject CDs issued to respondent and, therefore, remains liable for the value of the dollar deposits indicated thereon with accrued interest. A certiﬁcate of deposit is deﬁned as a written acknowledg- ment by a bank or banker of the receipt of a sum of money on deposit which the bank or banker promises to pay to the deposi- tor, to the order of the depositor, or to some other person or his order, whereby the relation of debtor and creditor between the bank and the depositor is created. Principles governing other 8 CIVIL CODE OF THE PHILIPPINES Art. 1106 types of bank deposits are applicable to CDs (10 AM Juri 2d Sec. 455), as are the rules governing promissory notes when they contain an unconditional promise to pay a sum certain of money absolutely. (Ibid., Sec. 457). The principle that payment, in order to discharge a debt, must be made to someone authorized to receive it is applicable to the payment of CDs. Thus, a bank will be protected in mak- ing payment to the holder a certiﬁcate indorsed by the payee, unless it has notice of the invalidity of the indorsement or the holder’s want of title. (10 Am Jur 2d Sec. 461). A bank acts at its peril when it pays deposits evidenced by a CD, without its production and surrender after proper indorsement. (Clark v. Young, 21 So. 2d 331 ). The equitable principle of laches is not sufﬁcient to defeat the rights of respondent over the subject CDs. Laches is the failure or neglect, for an unreasonable length of time, to do that which, by exercising due diligence, could or should have been done earlier. It is negligence or omission to assert a right within a reasonable time, warranting a presumption that the party entitled to assert it either has abandoned it or declined to assert it. (Felizardo v. Fernandez, GR 137509, Aug. 15, 2001). There is no absolute rule as to what constitutes laches or staleness of demand; each case is to be determined accord- ing to its particular circumstances. The question of laches is addressed to the sound discretion of the court and, being an equitable doctrine, its application is controlled by equitable considerations. It cannot be used to defeat justice or perpetrate fraud and injustice. Courts will not be guided or bound strictly by the Statute of Limitations or the doctrine of laches when to do so manifest wrong or injustice would result. (Rosales v. CA, GR 137566, Feb. 28, 2001). Respondent is entitled to moral damages because of the mental anguish and humiliation she suffered as a result of the wrongly refusal of petitioner to pay her even after she had de- livered the CDs. (Arts. 2217 and 2219). In addition, petitioner should pay respondent exemplary damages which the trial court imposed by way of example or correction for the public good (Art. 2229). Finally, respondent is entitled to attorney’s fees since petitioner’s act or omission compelled her to incur expenses to 9 Art. 1106 CIVIL CODE OF THE PHILIPPINES protect her interest making such award just and equitable. (Art. 2208). Development Bank of the Phils. v. CA & Carlos Cajes GR 129471, Apr. 28, 2000 FACTS: Petitioner ﬁled an ejectment suit against private respondent, claiming ownership of a parcel of land covered by a TCT, which included the 19.4 hectares being occupied by the latter. The trial court declared petitioner to be the owner of the land, but the Court of Appeals (CA) reversed the trial court. On appeal, petitioner claimed that its predecessor-in-interest had become the owner of the land by virtue of the decree of registra- tion in his name. The Supreme Court afﬁrmed the CA. HELD: Taking into consideration the possession of his predecessor-in-interest, private respondent had been in uninter- rupted adverse possession of the land for more than 30 years prior to the decree of registration issued in favor of petitioner’s predecessor-in-interest. Such possession ripened into ownership of the land thru acquisitive prescription, a mode of acquiring ownership and other real rights over immovable property. A decree of registration cut off or extinguished a right acquired by a person only when such right refers to a lien or encumbrance on the land which was not annotated on the certiﬁcate of title issued thereon, but not to the right of ownership thereof. Regis- tration of land does not create a title nor vest one. Accordingly, the 19.4 hectares of land being occupied by private respondent must be reconveyed in his favor. (11) Presumptive Period re Ill-Gotten Wealth or ‘Behest’ Loans Presidential Ad Hoc Fact-Finding Committee on Behest Loans v. Aniano A. Desierto (Recovery of Ill-Gotten Wealth) GR 130340, Oct. 25, 1999 114 SCAD 707 Behest loans, which are part of the ill-gotten wealth which former President Ferdinand E. Marcos and his cronies accumulated and which the Government thru the Presidential 10 CIVIL CODE OF THE PHILIPPINES Art. 1107 Commission on Good Government (PCGG) seeks to recover, have a prescriptive period to be counted from the discovery of the crimes charged, and not from the date of their commission. If the commission of the crime is known, the prescriptive period shall commence to run on the day it was committed. The prosecution of offenses arising from, relating or inci- dent to, or involving ill-gotten wealth contemplated in Sec. 15, Art. XI of the Philippine Constitution of 1987 may be barred by prescription. Said provision applies only in civil actions for recovery of ill-gotten wealth, and not to criminal cases. Art. 1107. Persons who are capable of acquiring property or rights by the other legal modes may acquire the same by means of prescription. Minors and other incapacitated persons may acquire property or rights by prescription, either personally or through their parents, guardians or legal representatives. COMMENT: (1) Who May Acquire Property or Rights by Prescription (a) those who can make use of the other modes of acquiring ownership. (b) even minors and other incapacitated persons (like the insane). (2) Reason for Par. 1 (Those Capable of Acquiring Property or Rights Thru the Other Modes) Since prescription is also a mode of acquiring ownership, it follows that if a person is capable of becoming an owner by the other legal modes, he should also be capable of acquiring the same property by prescription. Thus, if a person can become an owner by donation, he can also become an owner by prescription. (3) Query (Re Donation by Paramour) A husband cannot validly receive a donation from a para- mour. Now then, can he acquire by prescription the property donated to him by the paramour? 11 Art. 1108 CIVIL CODE OF THE PHILIPPINES ANS.: Yes, but only by extraordinary prescription (not ordinary prescription) since he would be lacking the element of “just title.” There would be no “just title” because under the law, they are incapacitated to donate to each other. (See Art. 739, Civil Code). Note that even if a donation is VOID, it may constitute the legal basis for adverse possession. (See Tagalgal v. Luega, CA-GR 19651-R, Feb. 19, 1959). (4) Reason Why Minors May Acquire Personally This is because only juridical capacity is required for pos- session, not capacity to act. Thus, even discernment of intent to possess is not required for such personal acquisition. This is so because the law makes no distinction. Art. 1108. Prescription, both acquisitive and extinctive, runs against: (1) Minors and other incapacitated persons who have parents, guardians or other legal representatives; (2) Absentees who have administrators, either appoint- ed by them before their disappearance, or appointed by the courts; (3) Persons living abroad, who have managers or ad- ministrators; (4) Juridical persons, except the State and its subdivi- sions. Persons who are disqualiﬁed from administering their property have a right to claim damages from their legal rep- resentatives whose negligence has been the cause of prescrip- tion. COMMENT: (1) Persons Against Whom Prescription May Run (a) The Article enumerates four such groups. (b) Reason for Pars. 1, 2, and 3: These people are supposed to be protected by those in charge. If they are not properly protected thru the lat- 12 CIVIL CODE OF THE PHILIPPINES Art. 1109 ter’s negligence, a claim for damages against the latter can prosper. (2) Query (Re Minors Without Parents, etc.) Suppose the minors or the insane persons have no parents or legal representatives, does prescription run against them? ANS.: While the Article seemingly implies that in such a case, prescription should not run against them, it is believed that Secs. 42, 45, and 46 of Act No. 190 (the Code of Civil Procedure) can apply to them, since implied repeals are not looked upon with favor. Thus, prescription can still run against minors, the insane, and those in jail, except that these people may still bring the action within a number of years after their disability has been removed: (a) 3 years — in case of recovery of land (b) 2 years — in other civil actions These saving clauses are in line with some saving clauses provided for minors and the incapacitated under the New Civil Code. (See, for example, Art. 285 with respect to the right of a natural child to compel recognition after the parent’s death, if the parent dies while the child was still a minor). If the minor has a guardian, there is NO DOUBT that pre- scription runs against him even during minority. (See Wenzel, et al. v. Surigao Consolidated Mining Co., L-10843, May 31, 1960). (3) State and Its Subdivisions No prescription can run against them, except with refer- ence to patrimonial property. (See Art. 1113, Civil Code). Art. 1109. Prescription does not run between husband and wife, even though there be a separation of property agreed upon in the marriage settlements or by judicial decree. Neither does prescription run between parents and children, during the minority or insanity of the latter, and between guardian and ward during the continuance of the guardianship. 13 Art. 1109 CIVIL CODE OF THE PHILIPPINES COMMENT: (1) No Prescription Between Husband and Wife (a) Reason for the law — The close relationship between them, engendered by affection or inﬂuence, may prevent one from suing the other. Hence, the general rule is — NO PRESCRIPTION. (NOTE: The Article was applied in Toriba Fontanilla Pacio, et al. v. Manuela Pacio Billon, et al., L-15088, Jan. 31, 1961). (b) Note that there is no prescription even if there has been a “separation of property,” for the same reluctance to sue each other may still exist. (c) Query — Suppose the “separation of property” is the conse- quence of legal separation, does prescription run? ANS.: It is believed that prescription will also not run, for the law does not distinguish. After all, here, the “separation of property” would be “by judicial decree.” (d) Exceptions — when prescription is speciﬁcally provided for by law, such as: 1) the prescriptive period for legal separation suits (Art. 120, Civil Code); 2) alienations made by the husband, without the wife’s consent. (Art. 173, Civil Code). (2) Between Parents and Children (a) No prescription shall run between them during the MI- NORITY or INSANITY of the latter. A sensu contrario prescription runs if the legal disability does not exist any- more. (b) As a general rule, even if the child is neither insane nor incapacitated, an adverse possession cannot be predicated on the possession of the parent as against the child, or in the possession of the child as against its parent. Thus, where a father became insane, and one of his sons managed the 14 CIVIL CODE OF THE PHILIPPINES Arts. 1110-1111 farm during the rest of his father’s lifetime and remained in possession of it for the statutory period, it was held that these facts alone did not warrant the presumption of a conveyance to the son by the father or of a release to him by the other heirs subsequent to their father’s death. (1 Am. Jur. 807 and Director of Lands v. Abiertas, 44 O.G. 923). (3) Between Guardian and Ward No prescription runs between them during the continuance of the guardianship. This is so even if the guardian expressly repudiates the guardianship (without court approval); otherwise, the trust relationship would be rendered nugatory. Art. 1110. Prescription, acquisitive and extinctive, runs in favor of, or against a married woman. COMMENT: Prescription in the Case of a Married Woman This Article refers to a married woman and a stranger. Art. 1111. Prescription obtained by a co-proprietor or a co-owner shall beneﬁt the others. COMMENT: (1) Prescription Obtained by Co-Proprietor or Co-Owner Reason: In a sense, a co-owner or co-proprietor acts for the interest of the whole co-ownership. Similarly, an action for ejectment may be brought by just one of the co-owners. (See Art. 487, Civil Code). [NOTE, however, that as between or among co-owners, there can be prescription when there is a deﬁnite repudiation of the co-ownership, made known to the other co-owners. (Laguna v. Levantino, 71 Phil. 566).] 15 Art. 1112 CIVIL CODE OF THE PHILIPPINES (2) Limitation The prescription obtained by a co-owner must have refer- ence to the property held in common, naturally; otherwise the Article does not apply. Art. 1112. Persons with capacity to alienate property may renounce prescription already obtained, but not the right to prescribe in the future. Prescription is deemed to have been tacitly renounced when the renunciation results from acts which imply the abandonment of the right acquired. COMMENT: (1) Requisites for Renunciation of Property Acquired by Prescription (a) Renouncer must have capacity to alienate property (be- cause renunciation is an exercise to the jus disponendi). (b) The property acquired must have already been obtained (hence, the right to prescription in the future cannot be renounced, since manifestly, this would be contrary to public policy). (c) The renouncing must be made by the owner of the right (not by a mere administrator or guardian, for he does not own the property). (d) The renouncing must not prejudice the rights of others, such as creditors. (Arts. 6, 1114, Civil Code). (2) Form (a) may be express or implied (tacit) (b) requires no consent on the part of the person to be ben- eﬁted (c) requires no solemnities or formalities (3) Implied or Tacit Renunciation There is tacit renunciation when there is an action which implies the abandonment of the right acquired. 16 CIVIL CODE OF THE PHILIPPINES Art. 1113 Example: Sonia formerly owed Esperanza but the debt has already prescribed. (a) If Sonia, knowing that the debt has prescribed, nevertheless still acknowledges the existence of the debt and promises to pay for it, there is an implied renunciation of the prescrip- tion. She still has a civil obligation. (b) If Sonia, knowing that the debt has prescribed, neverthe- less voluntarily pays the debt, she cannot recover what she had paid. This would be a natural obligation. (c) If Sonia, not knowing that the debt has prescribed pays it, there is no renunciation of the prescription; and she can still recover on the basis of solutio indebiti. ILLUSTRATIVE CASE: If a taxpayer, complaining re- peatedly against a tax assessment, makes several requests for a reinvestigation thereof, he may be said to have WAIVED the defense of prescription. (Yutivo & Sons Hardware Co. v. Ct. of Tax Appeals & Collector of Int. Rev., L-13203, Jan. 28, 1961). Art. 1113. All things which are within the commerce of men are susceptible of prescription, unless otherwise pro- vided. Property of the State or any of its subdivisions not pat- rimonial in character shall not be the object of prescription. COMMENT: (1) Things That May Be Acquired by Prescription Generally — all things within the commerce of man. (2) Patrimonial Property (a) By implication under this Article, patrimonial property of the State or any of its subdivisions may be acquired by prescription. (b) While it may be claimed that a direct and clear provision (Art. 1108, Civil Code — which says that prescription does not run against the State or any of its subdivisions) prevails 17 Art. 1113 CIVIL CODE OF THE PHILIPPINES over an implication (Art. 1113, Civil Code), still when we consider the intent of Congress in inserting the phrase “not patrimonial in character” in the original draft submitted by the Code Commission, it is clear that patrimonial property may indeed be the subject of prescription. This is so because patrimonial properties are really in the same category as private properties. (3) No Prescription With Respect to Public Property Public property, however, cannot be the subject of prescrip- tion. This rule applies even to privately owned unregistered lands which, unless the contrary is shown, are presumed to be public lands, under the principle that “all lands belong to the Crown unless they had been granted by the King (State) or in his name, or by the Kings who preceded him.” (Valenton v. Murciano, 3 Phil. 53). However, the rule just stated cannot be altogether inﬂex- ible, as witnessed, for example, by the presence of Rep. Act 1942 (approved June 22, 1957), amending Sec. 48(b) of the Public Land Act (Com. Act 141). Thus, as amended by RA 1952, Sec. 48 of CA 141 now reads as follows: “Section 48. The following described citizens of the Philip- pines occupying lands of the public domain or claiming to own any such land or an interest therein, but whose titles have not been perfected or completed, may apply to the Court of First In- stance of the province where the land is located for conﬁrmation of their claims and the issuance of a certiﬁcate of title therefor, under the Land Registration Act, to wit: xxx “b) Those who by themselves or through their predeces- sors in interest have been in open, continuous, exclusive and notorious possession and occupation of agricultural lands of the public domain, under a bona ﬁde claim of acquisition of ownership, for at least thirty years immediately preceding the ﬁling of the application for conﬁrmation of the title except when prevented by war or force majeure. These shall be conclusively presumed to have performed all the conditions essential to a Government grant, and shall be entitled to a certiﬁcate of title 18 CIVIL CODE OF THE PHILIPPINES Art. 1114 under the provisions of this chapter (the chapter deals with judicial conﬁrmation of imperfect or incomplete titles).” (NOTE: However, under RA 107, the deadline of the ap- plication was only up to Dec. 31, 1957.) (4) Some Doctrines (a) A ﬁshpond constructed in the Bambang River can be ordered removed by the government, regardless of the number of years that have elapsed since the construction of said ﬁshpond, inasmuch as a river, or a portion thereof, is property of public dominion, and cannot therefore be acquired by acquisitive prescription. (Meneses v. Com- monwealth, 69 Phil. 647). (b) Similarly, a tract of land, formerly low and swampy, but gradually raised by the action of the sea, is not susceptible of prescription, and may therefore be recovered by the gov- ernment despite the construction thereon of warehouses and a wharf. The land is part of the public domain. (Insular Government v. Aldecoa and Co., 19 Phil. 505). (c) A plaza intended for public use is likewise not subject to prescription. (Harty v. Mun. of Victoria, 13 Phil. 152). (5) Things or Properties That Cannot Be Acquired by Pre- scription (a) those protected by a Torrens Title. (Sec. 46, Act No. 496) (Francisco v. Cruz, 43 O.G. 5103). (b) movables acquired thru a crime. (Art. 1133, Civil Code). (c) those outside the commerce of men. (Art. 1113, Civil Code). (d) properties of spouses, parents and children, wards and guardians, under the restrictions imposed by law. (Art. 1109, Civil Code). Art. 1114. Creditors and all other persons interested in making the prescription effective may avail themselves thereof notwithstanding the express or tacit renunciation by the debtor or proprietor. 19 Art. 1115 CIVIL CODE OF THE PHILIPPINES COMMENT: (1) Right of Creditors to Make Use of Prescription Reason for the law: While rights may be waived, third persons with a right rec- ognized by law should not be prejudiced. (Art. 6, Civil Code). (2) Example Tom who is indebted to Nicole acquired a parcel of land by prescription. If Tom renounces the prescription, may Nicole make use of said land? ANS.: Yes, to the extent of her credit, if Tom is not able to pay his debt. Tom is not allowed to prejudice Nicole. Sambrano v. Court of Tax Appeals, et al. 101 Phil. 1 FACTS: Although the right of the State to collect the taxes had already been extinguished by prescription, taxpayer Sam- brano nevertheless executed a chattel mortgage on his proper- ties to guarantee the payment of the same. As a matter of fact, he actually paid part of the debt. Issue: Can Sambrano later on raise the issue of prescription? HELD: No more, for his actuations amount to a renewal (renovacion) of the obligation or to a waiver of the beneﬁt granted by the law to him. He is, therefore, now estopped from raising the issue of prescription. Moreover, the Court said that a prescribed debt may be the subject of novation. (Estrada v. Villaroel, 40 O.G. Supp. No. 5, 9, p. 201). Art. 1115. The provisions of the present Title are un- derstood to be without prejudice to what in this Code or in special laws is established with respect to speciﬁc cases of prescription. COMMENT: (1) Speciﬁc Provisions on Prescription Speciﬁc provisions on prescription found elsewhere in the Code, or in special laws, prevail over the provisions of this 20 CIVIL CODE OF THE PHILIPPINES Art. 1115 Chapter. This is particularly true in the instances when speciﬁc periods of prescription are provided for. (2) Examples (a) A legitimate child may bring an action to claim legitimacy as long as he is alive (generally). (Art. 173, Family Code). (b) An illegitimate child may bring an action to establish il- legitimate ﬁliation during his lifetime (generally). (Art. 175, Family Code). (c) The real right of possession of real property is lost at the end of 10 years. (d) The proceeding for the probate of a will never prescribes. (Guevara v. Guevara, et al., L-5405, Jan. 31, 1956). (e) The proceeding for the deportation of an alien must be brought within ﬁve years from the date the cause for de- portation arose. (Sec. 37, Immigration Act). [Thus, where an alien entered the Philippines illegally in 1998, but he violated the Immigration Law in 2004 by bringing in his wife who was not lawfully entitled to enter or reside in the Philippines, the deportation proceeding commenced in 2005 had not prescribed. This is because the cause accrued in 1999. (See Porta Perez v. Board, L-9236, May 29, 1957).] (f) An action to annul a sale of shares of stock in a corpora- tion is violation of the Securities Act because there was no permit for the same, and for the recovery of the purchase price must be instituted within a period of two years from the date of the sale. Hence, if the sale is made on Oct. 23, 2003, but the action is brought on Nov. 2, 2005, the action is 10 days late, and can no longer be entertained. (See Benedicto v. Phil. American Finance and Development Co., L-8695, May 31, 1957). (g) In order to confer jurisdiction on the Court of Tax Appeals, the suit for refund of taxes erroneously or illegally assessed must be brought within the statutory period of two years, and the requirements provided in the National Internal 21 Art. 1116 CIVIL CODE OF THE PHILIPPINES Revenue Code must be complied with. (Collector of Internal Revenue v. Court of Tax Appeals, et al., L-11494, Jan. 28, 1961). (h) An action for accounting or reliquidation of agricultural crops under par. 3, Sec. 17 of Rep. Act 1199 should be brought within 3 years from the threshing of the crops in question. (Agaton Mateo v. Gregorio Duran, et al., L-14314, Feb. 22, 1961). Art. 1116. Prescription already running before the ef- fectivity of this Code shall be governed by laws previously in force; but if since the time this Code took effect the entire period herein required for prescription should elapse, the present Code shall be applicable, even though by the former laws a longer period might be required. COMMENT: (1) Transitional Rules for Prescription (a) If the period for prescription BEGAN and ENDED under the OLD laws, said OLD laws govern. (b) If the period for prescription BEGAN under the NEW Civil Code, the NEW Civil Code governs. (c) If the period began under the OLD law, and continues under the NEW Civil Code, the OLD law applies. Exception: In this third rule, it is the NEW Civil Code that will apply, provided two conditions are present: 1) The NEW Civil Code requires a shorter period; 2) This shorter period has already elapsed since Aug. 30, 1950, the date when the NEW Civil Code became effective. (Thus, the period prescribed under the NEW Code should be counted from Aug. 30, 1950. However, if by this method a longer period would be needed, a 22 CIVIL CODE OF THE PHILIPPINES Art. 1116 period that is even longer than that provided under the OLD law, said OLD law applies). (2) Example of the First Rule Given Paz Ongsiaco and the Heirs of the Late Augusto Ongsiaco v. Roman D. Dallo, et al. L-27451, Feb. 28, 1969 FACTS: A complaint was ﬁled in 1966 against the family of Paz Ongsiaco for recovery of the ownership of a parcel of land in Cuyapo, Nueva Ecija. It was admitted by claimants that since 1924 (42 years before the basic complaint was ﬁled in 1966), said family had been in possession of the land and that said posses- sion was really adverse or in the concept of owner. However, it was alleged that the possession was in BAD FAITH. Issue: May recovery of the property be allowed? HELD: Recovery cannot be allowed for the cause of action has already prescribed. Under Art. 1116, in a case like this, the law in force before the New Civil Code should apply. It is clear that under such old law, the Code of Civil Procedure, good or bad faith was immaterial for purposes of acquisitive prescrip- tion. (Sec. 41). Moreover, even the thirty-year period ﬁxed in the New Civil Code for the acquisition in bad faith by prescription of real property had already expired when this case was ﬁled in 1966. (3) Example of the Third Rule Given BAR A, with knowledge that B is not the owner of a parcel of land, buys it for a nominal sum from B in 1944, and since then has been in open, actual, continuous, and public possession thereof, under claim of title exclusive of any other rights and adverse to all other claimants. C, the real owner of the land, who has left in 1944 by reason of the war, was able to return to the land only in 1958 and learning of A’s possession, ﬁles suit. A claims prescription of ten years, because he took possession of the land before the new Civil Code; but C counters that as 23 Art. 1116 CIVIL CODE OF THE PHILIPPINES A entered the land in bad faith, and he had not yet acquired ownership by the time the New Civil Code took effect, the period is thirty years under the New Code. Decide with reasons. ANS.: Inasmuch as here the prescription was already run- ning before Aug. 30, 1950, it follows that only 10 years would be required because under the Code of Civil Procedure, regardless of good faith or bad faith, the period for acquiring land by prescrip- tion was only 10 years. (Sec. 41, Act 190, Code of Civil Procedure and Osorio v. Tan Jongko, 51 O.G. 6221). It, therefore, follows necessarily that in 1954, A had already acquired the property by acquisitive prescription. Hence, C should lose the case, unless of course the land is covered by a Torrens Certiﬁcate of Title. (Osorio v. Tan Jongko, supra). The period of 10 years must necessarily start from 1944, and not from Aug. 30, 1950, since here, the prescriptive period under the OLD law was SHORTER. Had the period under the old law been LONGER, it is the shorter period under the new Civil Code that should apply, but this time, the period should commence from the date of effectivity of the new Civil Code — Aug. 30, 1950 — in view of the clause “but if since the time this Code took effect...” (4) Example of the Exception Under the old law the period was 10 years (as in the case of reduction of a donation of land on the ground of birth of a child), but under the New Civil Code, the period is only 4 years, counted from the birth of the ﬁrst child. (Art. 763). It is clear here that the New Civil Code (4 years) will apply, even if the donation and the birth occurred under the old law, but the period should be counted from Aug. 30, 1950, unless in so doing, a period of more than 10 years would result. (5) Some Doctrines (a) In Estayo v. De Guzman, L-10902, Dec. 29, 1958, the Supreme Court held that when the action to enforce the mortgage presented as an appeal bond in a court action be- came effective by the entry of the judgment of the Supreme Court on Aug. 6, 1940, the encumbrance may be cancelled after Aug. 6, 1950. 24 CIVIL CODE OF THE PHILIPPINES Art. 1116 (b) In Ongsiako, et al. v. Ongsiako, et al., L-7510, Mar. 30, 1957, the Supreme Court held that Art. 1116 (Civil Code) prevails over the general transitory rule in Art. 2258 (Civil Code) which provides that actions and rights which came into being but which were not exercised before the effectivity of the Code, shall remain in full force in conformity with the old legislation, but the exercise, duration, and procedure to enforce them shall be regulated by the Rules of Court. (c) In Borromeo v. Zaballero, L-14357, Aug. 31, 1960, a promissory note was executed in 1935, payable in 1937. The claim for payment was presented in the settlement of the estate of the deceased debtor in Sept. 1955. The Court ruled that the ten-year period of prescription under Act 190 had already lapsed. (d) In Nagrampa, et al. v. Nagrampa, L-15434, Oct. 31, 1960, the Court observed that under the old law, no special period of prescription was ﬁxed for the revocation of donations for non-compliance with the conditions stipulated. However, under the New Civil Code (Art. 764), the period ﬁxed for such a case is 4 years. The suit was ﬁled in July, 1958, al- leging that the plaintiffs had demanded compliance “ﬁve years ago, but the defendant refused.” The Court held that the entire period of four years ﬁxed by the New Civil Code has elapsed since it took effect in 1950. Suit was ﬁled only in July, 1958 for a violation made in 1953. (e) In Amar v. Odianan, L-15179, Sept. 30, 1960, a complaint for the recovery of land was ﬁled in November, 1948, al- leging that in April, 1948, the land had been seized by the defendant by means of fraud, deceit, and strategy. It was held that the old law, Sec. 40 of Act 190 (which provided that an action for the recovery of real property can only be brought within 10 years) was applicable, and that there- fore, the action has already prescribed. (f) In PNB v. Galicano Ador Dionisio, L-18342, Sept. 19, 1963, it was held that a judgment that had become ﬁnal in 1949 could not be revived anymore in 1960 (lapse of more than 10 years), despite written extrajudicial demand in 1954 for the satisfaction of the judgment. This is because this 25 Art. 1116 CIVIL CODE OF THE PHILIPPINES case is governed not by Art. 1155 of the Civil Code, but by Sec. 50 of the Code of Civil Procedure (which section does not state that such written extrajudicial demands interrupt the prescriptive period). The old law applies because Art. 1116 says “prescription already running before the effec- tivity of this Code shall be governed by laws previously in force...” 26 CIVIL CODE OF THE PHILIPPINES Chapter 2 PRESCRIPTION OF OWNERSHIP AND OTHER REAL RIGHTS Art. 1117. Acquisitive prescription of dominion and other real rights may be ordinary or extraordinary. Ordinary acquisitive prescription requires possession of things in good faith and with just title for the time ﬁxed by law. COMMENT: (1) Requisites Common to Ordinary and Extraordinary Pre- scription (a) capacity of acquirer to acquire by prescription (b) capacity of loser to lose by prescription (c) object must be susceptible of prescription (d) lapse of required period of time (e) the possession must be: 1) in concepto de dueño (concept of owner) 2) public (not clandestine or non-apparent) 3) peaceful (not thru force, violence, or intimidation) 4) continuous or uninterrupted [NOTE: Under the old law — the Code of Civil Procedure whether the possession was in good faith or in bad faith did not matter. The period for im- movables was always 10 years. Also, the possession need not be peaceful. (See Arboso v. Andrade, 87 Phil. 782). However, the possession, even under the old law 27 Art. 1118 CIVIL CODE OF THE PHILIPPINES had to be uninterrupted, actual, exclusive, and not merely tolerated. (See Pascual v. Mina, 20 Phil. 202 and Villanueva v. Protacio, CA-GR 7591-R, Mar. 22, 1955).] (2) Additional Requisites (a) for ORDINARY prescription 1) good faith 2) just title (there was a mode of acquiring ownership but the grantor was not the owner; hence, the just title here is “titulo colorado” or “colorable title”). (b) for EXTRAORDINARY prescription (no other requisites except those mentioned in Comment No. 1 under this Ar- ticle are required). Art. 1118. Possession has to be in the concept of an owner, public, peaceful and uninterrupted. COMMENT: (1) Characteristics of the Possession Needed for Prescrip- tion See this Article. See also the comments in the preceding Article. (2) Possessor in the Concept of Holder A possessor in the concept of holder cannot acquire property by prescription because his possession is not adverse. Thus, the possession of land in the capacity of administrator (mere holder) cannot ripen into ownership. (Ranjo v. Payoma, L-1866, May 30, 1951). Neither is the possession by a mortgagee adverse. (Garcia v. Arjona, L-7279, Oct. 29, 1955). (3) Owner-Administrator The mere fact that the person who claims ownership of the property also administers the same does not militate against its acquisition of the property by prescription. The fact that he 28 CIVIL CODE OF THE PHILIPPINES Arts. 1119-1120 stated that he administered the properties in question does not necessarily imply that he is not the owner thereof for certainly an owner of a property can be its own administrator. (Guarin, et al. v. De Vera, L-9577, Feb. 28, 1957). Art. 1119. Acts of possessory character executed in vir- tue of license or by mere tolerance of the owner shall not be available for the purposes of possession. COMMENT: Possession by License or Tolerance of Owner In possession by license or tolerance, there is implied rec- ognition of ownership residing in ANOTHER. (See Macaltao v. Castro, CA-GR 22408-R, Aug. 12, 1963). Art. 1120. Possession is interrupted for the purposes of prescription, naturally or civilly. COMMENT: (1) How Possession Is Interrupted for Purposes of Prescrip- tion (a) naturally. (Arts. 1121, 1122, Civil Code). (b) civilly. (Arts. 1123, 1124, Civil Code). (2) Natural Interruption If prescription is interrupted, the old possession will gener- ally not be counted; the period must begin all over again. (3) Suspension of Prescription If prescription is merely suspended (as distinguished from interruption), the old possession will be ADDED. This may hap- pen when during war, the civil courts are NOT open (Arts. 1136, Civil Code); or when there is a moratorium on the payment of debts. (Talens, et al. v. Chuakay and Co., GR L-10127, Jun. 30, 29 Arts. 1121-1123 CIVIL CODE OF THE PHILIPPINES 1958 and Rio and Co. v. Datu Jolkipli, GR L-12301, Apr. 13, 1959). Art. 1121. Possession is naturally interrupted when through any cause it should cease for more than one year. The old possession is not revived if a new possession should be exercised by the same adverse claimant. COMMENT: (1) ‘Natural Interruption’ Deﬁned The deﬁnition is implied in the ﬁrst paragraph. Note the phrase “any cause.” (2) Reason for the Period Involved Possession de facto is lost if the property be in the posses- sion of another for more than one year. Hence, if the possession of another has been for one year or less, it is as if there was no interruption. (Art. 1122, Civil Code). (3) Reason for the Non-Revival of the Possession Possession here must be continuous and not interrupted. Art. 1122. If the natural interruption is for only one year or less, the time elapsed shall be counted in favor of the pre- scription. COMMENT: The Article explains itself. Art. 1123. Civil interruption is produced by judicial sum- mons to the possessor. COMMENT: ‘Civil Interruption’ Deﬁned The deﬁnition is implicit in the Article. 30 CIVIL CODE OF THE PHILIPPINES Arts. 1124-1125 Art. 1124. Judicial summons shall be deemed not to have been issued and shall not give rise to interruption: (1) If it should be void for lack of legal solemnities; (2) If the plaintiff should desist from the complaint or should allow the proceedings to lapse; (3) If the possessor should be absolved from the com- plaint. In all these cases, the period of the interruption shall be counted for the prescription. COMMENT: (1) When Judicial Summons Cannot Be Considered Civil Interruption Three instances are given in the Article. NOTE: If the possessors are sued, but emerge victorious, it is as if there was no interruption during the period of the suit. (Lacuesta v. Guerrero, 8 Phil. 719). (2) Apparent Interruption In the three cases given above, it is as if there was NO in- terruption. “Interruption” in the last sentence should therefore read as “apparent interruption” since under the law there was never an interruption. (See ﬁrst sentence). (3) Applicability to Acquisitive, Not Extinctive Prescrip- tion In Amar v. Odianan (L-15179, Sept. 30, 1960), the Court held that Arts. 1943, 1945, and 1946 of the old Civil Code (and from which Arts. 1120, 1123, and 1124 of the New Civil Code were taken), refer to interruption of possession in relation to acquisitive prescription, and not to cases of extinctive prescrip- tion. Art. 1125. Any express or tacit recognition which the possessor may make of the owner’s right also interrupts pos- session. 31 Art. 1126 CIVIL CODE OF THE PHILIPPINES COMMENT: (1) Recognition by Possessor of Owner’s Right Reason for the Article — Here the possession is no longer in concepto de dueño or adverse. (2) Example The act of a government ofﬁcial, duly authorized to so act, in recognizing ownership of land in a private person, interrupts possession by the municipality concerned. (Seminary of San Carlos v. Mun. of Cebu, 19 Phil. 32). Art. 1126. Against a title recorded in the Registry of Prop- erty, ordinary prescription of ownership or real rights shall not take place to the prejudice of a third person, except in virtue of another title also recorded; and the time shall begin to run from the recording of the latter. As to lands registered under the Land Registration Act, the provisions of that special law shall govern. COMMENT: (1) Prescription of Titles Recorded in Registry of Property (a) It is clear that Art. 1126 does NOT refer to land registered under the Land Registration Law (with a Torrens Title). (b) It, however, refers to all other lands. (c) Example: Arcadio is the owner of land not protected by a Tor- rens Title. His right is, however, duly registered in the Registry (for the deed of sale in his favor has been duly registered). 1) If Artemio, a stranger, takes possession of the land in good faith (from a seller-forger), is there a chance for him to become, after 10 years, the owner of the land, as against Arcadio? 32 CIVIL CODE OF THE PHILIPPINES Art. 1126 ANS.: Yes, after all, Arcadio is not protected by a Torrens Title. He certainly is not the third person referred to in the Article. (See Sison v. Ramos, 13 Phil. 54). Thus, as between Arcadio and Artemio, Artemio becomes the owner at the end of 10 years. 2) Suppose 12 years after Artemio takes possession, Arcadio sells the land to Benedicto, an innocent purchaser for value (who, in investigating Arcadio’s title found that the property was indeed registered in Arcadio’s name), will Benedicto become the owner? ANS.: Yes, for insofar as the innocent world was concerned, Arcadio was still the owner at the time he sold it to Benedicto. He could therefore validly transfer ownership to Benedicto Artemio’s prescrip- tive right should clearly not prejudice Benedicto. (NOTE: If Artemio had caused his title to be registered, he could have become the owner insofar as the entire world was concerned, not from the time he registered the forged deed of sale in his favor but from the time of the lapse of 10 years after such recording. What begins to run from such recording is not the ownership, but the period or time for prescription.) (2) Lands Registered Under the Land Registration Law Lands registered under the Torrens system cannot be acquired by prescription (Alfonso v. Jayme, L-12754, Jan. 30, 1960) but this rule can be invoked only by one under whose name (or under whose predecessor’s name) it was registered. (Jocson, et al. v. Silos, L-12998, July 25, 1960). Alfonso v. Jayme L-12754, Jan. 30, 1960 FACTS: Plaintiff’s land, protected by a Torrens Title, was taken by Pasay City for conversion into a road in 1925, without compensation. In 1954, plaintiff sued for recovery of the land or its value. HELD: Since the land was under his name under the Tor- rens system, plaintiff remained owner, and could recover posses- 33 Arts. 1127-1128 CIVIL CODE OF THE PHILIPPINES sion at any time. However, because it is now a ROAD, it is not convenient to restore it to plaintiff. Pasay City was ordered to pay compensation based on the value of the land in 1925, with legal interest as damages. Jocson, et al. v. Silos L-12998, Jul. 25, 1960 FACTS: A widower sold conjugal property, registered under his name under the Torrens system, to an innocent purchaser for value, who was subsequently given or issued a new transfer certiﬁcate of title, under his (the buyer’s) name. Twenty-two years later, the heirs of the deceased spouse (the wife) sued for annulment of the sale with respect to one-half of the land. HELD: The suit for annulment and recovery has already prescribed. The claim of imprescriptibility would have been cor- rect if the land had been registered in the name of the husband and wife, not in the name of the husband alone. Art. 1127. The good faith of the possessor consists in the reasonable belief that the person from whom he received the thing was the owner thereof, and could transmit his owner- ship. COMMENT: ‘Good Faith of Possessor’ Deﬁned Note that the deﬁnition here of good faith applies in con- nection with prescription. Art. 1128. The conditions of good faith required for possession in Articles 526, 527, 528, and 529 of this Code are likewise necessary for the determination of good faith in the prescription of ownership and other real rights. COMMENT: (1) Other Requisites for Good Faith The requisites in the Articles mentioned must ALL be present — otherwise there is no good faith. 34 CIVIL CODE OF THE PHILIPPINES Art. 1128 (a) Art. 526. He is deemed a possessor in good faith who is not aware that there exists in his title or mode of acquisition any ﬂaw which invalidates it. He is deemed a possessor in bad faith who possesses in any case contrary to the foregoing. Mistake upon a doubtful or difﬁcult question of law may be the basis of good faith. (b) Art. 527. Good faith is always presumed, and upon him who alleges bad faith on the part of a possessor rests the burden of proof. (c) Art. 528. Possession acquired in good faith does not lose this character except in the case and from the moment facts exist which show that the possessor is not unaware that he possesses the thing improperly or wrongfully. (d) Art. 529. It is presumed that possession continues to be enjoyed in the same character in which it was acquired, until the contrary is proved. (2) For How Long the Good Faith Must Last The good faith must last throughout the required period. (TS, Jan. 25, 1945). (3) Good Faith Changing to Bad Faith It is, however, possible that the good faith may later change to bad faith. In such a case, how many more years of possession would be required? ANS.: (a) For real property, three years of possession in bad faith would be equivalent to one year of possession in good faith. (Reason: 30 years would be required for extraordinary prescription, but only 10 years are needed for ordinary prescription). (b) For personal property, two years of possession in bad faith would be equivalent to one year in good faith. 35 Arts. 1129-1130 CIVIL CODE OF THE PHILIPPINES (Reason: Extraordinary prescription needs 8 years; ordinary prescription, 4 years). Art. 1129. For the purposes of prescription, there is just title when the adverse claimant came into possession of the property through one of the modes recognized by law for the acquisition of ownership or other real rights, but the grantor was not the owner or could not transmit any right. COMMENT: ‘Just Title’ Deﬁned (a) The deﬁnition is implied in the Article. (b) See Comments under the next Article. Art. 1130. The title for prescription must be true and valid. COMMENT: Nature of the Title Required (a) What is really meant by just title is “titulo colorado,” that is, there was a mode of acquisition but the grantor was not the owner. Had he been the owner, there would be no more necessity for prescription. (See Doliendo v. Biarnesa, 7 Phil. 232; see also Genova v. Cariobaldes, CA-GR 15945-R, Mar. 25, 1957, 53 O.G. 4511). (b) “True and valid” as used in Art. 1130 does not mean one without any defect, for in such a case, there would be no necessity for prescription. What it means is that the mode should ordinarily have been valid and true, had the grantor been the owner. (Doliendo v. Biarnesa, 7 Phil. 232; 2 Castan 240). Thus, if aside from the defect of the grantor not being the owner, there is another defect that would render the acquisition void, the title thus acquired would not be suf- ﬁcient for ordinary prescription. Such for example would be the case if the contract were absolutely simulated; or when 36 CIVIL CODE OF THE PHILIPPINES Arts. 1131-1132 a husband, pretending to be the owner of certain property, would donate it to his paramour. Even if the husband had been the owner, the donation would have been null and void just the same. Here, the donee, lacking “just title,” can acquire ownership by extraordinary, not by ordinary prescription. Art. 1131. For the purposes of prescription, just title must be proved; it is never presumed. COMMENT: Necessity of Proving the Just Title (a) Proof is needed in view of the aggressive or offensive char- acter of prescription. (b) In prescription, therefore, the presumption of just title given under Art. 541 regarding DEFENSE of rights does not apply. (See 2 Castan 241). Art. 1132. The ownership of movables prescribes through uninterrupted possession for four years in good faith. The ownership of personal property also prescribes through uninterrupted possession for eight years, without need of any other condition. With regard to the right of the owner to recover personal property lost or of which he has been illegally deprived, as well as with respect to movables acquired in a public sale, fair, or market, or from a merchant’s store the provisions of Articles 559 and 1505 of this Code shall be observed. COMMENT: (1) Period of Prescription for Movables This Article states the rules for MOVABLES: (a) ordinary prescription — 4 years (b) extraordinary prescription — 8 years 37 Art. 1133 CIVIL CODE OF THE PHILIPPINES (2) Rule with Respect to Lost Movables and Those of Which the Owner Has Been Illegally Deprived The possession of movable property acquired in good faith is equivalent to a title. Nevertheless, one who has lost any mov- able or has been unlawfully deprived thereof, may recover it from the person in possession of the same. If the possessor of a movable lost or of which the owner has been unlawfully deprived, has acquired it in good faith at a public sale, the owner cannot obtain its return without reim- bursing the price paid therefor. (Art. 559, Civil Code). (3) Rule with Respect to Public Sales, Fairs, Markets, and Merchant’s Store Subject to the provisions of this Title, where goods are sold by a person who is not the owner thereof, and who does not sell them under authority or with the consent of the owner, the buyer acquired no better title to the goods than the seller had, unless the owner of the goods is by his conduct precluded from denying the seller’s authority to sell. Nothing in this Title, however, shall affect: (a) The provisions of any factors’ acts, recording laws, or any other provision of law enabling the apparent owner of goods to dispose of them as if he were the true owner thereof; (b) The validity of any contracts of sale under statutory power of sale or under the order of a court of competent jurisdic- tion; (c) Purchases made in a merchant’s store, or in fairs, or mar- kets, in accordance with the Code of Commerce and special laws. (Art. 1505, Civil Code). Art. 1133. Movables possessed through a crime can never be acquired through prescription by the offender. COMMENT: (1) Movables Possessed Through a Crime Note the word “offender.” By implication, subsequent acquirers from the “offender” may acquire the property by pre- scription. 38 CIVIL CODE OF THE PHILIPPINES Arts. 1134-1136 (2) Rule for Immovables (Where Crimes Are Involved) Regarding immovables, possession by force or violence does not give rise to prescription. Art. 1134. Ownership and other real rights over immov- able property are acquired by ordinary prescription through possession of ten years. COMMENT: Prescriptive Periods for Acquiring Real Property This Article and the following ones state the rule for IM- MOVABLES: (a) ordinary prescription — 10 years (b) extraordinary prescription — 30 years. (Art. 1137, Civil Code). Art. 1135. In case the adverse claimant possesses by mis- take an area greater, or less, than that expressed in his title, prescription shall be based on the possession. COMMENT: When Area Possessed Varies from Area in Title (a) The term “possesses” here refers to both actual and con- structive possession, since possession in the eyes of the law does not mean that a man has to have his feet on every square meter of land. (Ramos v. Dir. of Lands, 39 Phil. 175). (b) Notice that “possession” here prevails over the “title.” Necessarily, if there is NO title, the Article cannot apply. (c) The possession here must be “by mistake.’’ Art. 1136. Possession in wartime, when the civil courts are not open, shall not be counted in favor of the adverse claimant. 39 Art. 1137 CIVIL CODE OF THE PHILIPPINES COMMENT: (1) Possession in War Time (a) The Article does not apply when the civil courts are open. In Rio y Compania v. Datu Jolkipli, L-12301, April 13, 1959, the Supreme Court held that the statute of limitations is suspended if during wartime, courts are not or cannot be kept open. However, to invoke this rule, a party must ﬁrst show that the court was closed or could not be opened for business as a consequence of chaos and confusion. The determination of this matter is a question of fact, which should be ventilated in the hearing of a case on the mer- its. (b) During the Japanese occupation, there were places in the Philippines where no civil courts could function. (2) Fortuitous Event — Effect on Prescription Note that under Art. 1154 of the Civil Code, “the period during which the obligee was prevented by a fortuitous event from enforcing his right is not reckoned against him.” Art. 1137. Ownership and other real rights over immova- bles also prescribe through uninterrupted adverse posses- sion thereof for thirty years, without need of title or of good faith. COMMENT: (1) Extraordinary Prescription With Respect to Immova- bles This Article refers to extraordinary prescription regard- ing: (a) ownership over immovables (b) other real rights over immovables (2) Period Required Note the period — 30 years. 40 CIVIL CODE OF THE PHILIPPINES Art. 1138 (3) What Are Not Needed Under this Article, neither good faith nor just title is es- sential; hence, property voidly donated may be acquired by ex- traordinary prescription. This may for instance occur when the donation of real properties had not been validly accepted by the donee. Although here the donation is void, it may be the basis for the acquisition of the donee of said properties by prescription. (Guarin, et al. v. De Vera, L-9577, Feb. 28, 1957 and Pensader v. Pensader, 47 Phil. 959). (4) Retroactive Effect of the Prescription Prescription has a retroactive effect, that is, the acquirer, as soon as the necessary period has lapsed, is considered the owner from the BEGINNING of the possession. Thus, any encum- brances made by him during said period should be considered as valid, while those of the original owner are not binding on the acquirer by prescription. The acquirer is also entitled to all the fruits during said period in view of his retroactive ownership. (2 Castan 254-255). Art. 1138. In the computation of time necessary for pre- scription, the following rules shall be observed: (1) The present possessor may complete the period necessary for prescription by tacking his possession to that of his grantor or predecessor in interest; (2) It is presumed that the present possessor who was also the possessor at a previous time, has continued to be in possession during the intervening time, unless there is proof to the contrary; (3) The ﬁrst day shall be excluded and the last day in- cluded. COMMENT: Rules for Computation of Time Par. 1 — Tacking of Possession (a) This means ADDING the period of possession of the predecessor. Reason: The true owner of the property was 41 Art. 1138 CIVIL CODE OF THE PHILIPPINES after all NOT in possession, during the possession of said predecessor. (b) Tacking is allowed only if there be privity of relationship between the predecessor and the successor, as in the case of succession, donation, sale, barter, etc. Thus, a mere intruder or usurper cannot “tack.” (See Razote v. Razote, 14 Phil. 182; Lacson v. Gov’t., 39 Phil. 63). (c) “Tacking” by a subsequent possessor of his predecessor’s possession can be allowed if the predecessor’s possession can satisfy the requisites for prescription (such as the fact that the possession must be in the concept of owner, peace- ful, etc.). (See 2 Corpus Juris 92 and Casilag v. Fajardo, CA-GR 1066-R Jun. 18, 1948, 46 O.G. 570). Par. 2 — Presumption of Continuing Possession The presumption is expressly declared to be rebuttable. 42 CIVIL CODE OF THE PHILIPPINES Chapter 3 PRESCRIPTION OF ACTION Art. 1139. Actions prescribe by the mere lapse of time ﬁxed by law. COMMENT: (1) How Actions Prescribe By the mere lapse of the time indicated in the law. There is no other requirement. (2) Scope or Nature of the Chapter This chapter is our general Statute of Limitations, because particular provisions on prescription naturally prevail. (See Art. 1148, Civil Code). (3) Prescription as a Defense In general, we may say that the prescription of action is available as a DEFENSE. To be asserted as such, it must be speciﬁcally pleaded and proved. (Hodges v. Salas, 63 Phil. 567). Thus, if not set up or pleaded as a defense, proof cannot later on be presented if objection is made to the introduction of such proof. (National Bank v. Escudero, 92 Phil. 150). Upon the other hand, as long as the defendant raised the defense of prescription in his answer to the complaint, but the complaint was dismissed on some other ground, he can still set up in his brief in the ap- pellate court in an appeal by the plaintiff from the decision of the trial court. (Lapuz v. Sy Uy, L-10079, May 17, 1957). If the issue of prescription can be decided from the averments of the pleadings, more particularly from the plaintiff’s complaint, there is NO necessity of receiving evidence on the matter, before the 43 Art. 1139 CIVIL CODE OF THE PHILIPPINES Court may dismiss the complaint on the ground of prescription. (Bambao, et al. v. Lednicky, et al., L-15495, Jan. 28, 1961). (4) Effect of Death on Prescription If a father has a cause of action against a stranger (the period of prescription of which is, let us say, 4 years) and the father dies before the end of such prescriptive period, should prescription continue to run, even if say his children are still MINORS? The Supreme Court in the case of Martir, et al. v. Trinidad, et al., L-12057, May 20, 1959, answered YES, for after all in this case the cause of action accrued in favor of the father himself, and not directly in favor of the children. Except where a statute provides otherwise, one disability (like the father’s death) CANNOT be tacked to another’s disability (like the children’s minority). Nor can a party avail himself of several disabilities, unless they all existed at the time when the right of action accrued. This is in obedience to the universal rule that when a Statute begins to run, no subsequent disability can stop its operation unless specially so provided in the statute. (5) Conﬂict of Laws — Variance of Foreign and Local Law Re Prescription In the case of D’Almeida v. Hagedorn (L-10804, May 22, 1957), an action was brought in 1954 in the Philippines on two demand notes executed in 1942 and 1943 in Hong Kong where both debtor and creditor were residing until liberation. The Court, in applying the rule that the moratorium law suspended the running of the prescriptive period and that therefore the ac- tion had not prescribed, ruled that prescription is governed by the law of the forum. It would seem from this ruling that even if the cause of action accrued in Hong Kong and has already prescribed under Hong Kong law, it has not yet prescribed under Philippine law. This seems to lose sight of a section of Act 190 (Code of Civil Procedure) which states that “if, by the laws of the State or country where the cause of action arose, the action is barred, it is also barred in the Philippines.” In the instant case, however, there was no proof that the claim was barred under Hong Kong law, and it is well-settled that in the absence of proof of the foreign law, it is presumed to be the same as Philippine law. 44 CIVIL CODE OF THE PHILIPPINES Arts. 1140-1141 (NOTE: The presumption has been referred to as a “proces- sual presumption”). (6) How Long Is a Month? Quizon v. Baltazar 76 SCRA 560 The term “month” as used in a law (such as Art. 90 of the Revised Penal Code) is understood to refer to a 30-day month and not to a calendar month. (7) Query Does a property deemed part of the public forest pre- scribe? ANS.: An action for reversion ﬁled by the State to recover property registered in favor of any party which is part of the public forest or of a forest reservation never prescribes. (Heirs of the Late Spouses Pedro S. Palanca and Soteranea Rafols Vda. De Palanca v. Republic, 500 SCRA 209 ). Art. 1140. Actions to recover movables shall prescribe eight years from the time the possession thereof is lost, unless the possessor has acquired the ownership by prescription for a less period, according of Article 1132, and without prejudice to the provisions of Articles 559, 1505, and 1133. COMMENT: Recovery of Movables This refers to extraordinary prescription for movables. Art. 1141. Real action over immovables prescribe after thirty years. This provision is without prejudice to what is established for the acquisition of ownership and other real rights by pre- scription. 45 Art. 1142 CIVIL CODE OF THE PHILIPPINES COMMENT: Recovery of Immovables (a) This refers to extraordinary prescription for immovables. (b) The possession de jure of an immovable is lost, however, at the end of 10 years. (No. 4, Art. 555, Civil Code). De Jesus, et al. v. CA, et al. GR 57092, Jan. 21, 1993 Prescription running even after the effectivity of the New Civil Code on August 30, 1950, continued to be governed by Sec. 41 of the Old Civil Code. Under the present Civil Code, the prescriptive period re- quired for the acquisition of immovable property is 10 years if the possession is in good faith, and 30 years if in bad faith. Such open, continuous, exclusive and notorious occupation of the dis- puted property for 30 years must be conclusively established. Reckoned from the time she executed the afﬁdavit of ad- judication in 1961, eleven years after the New Civil Code had taken effect, private respondent’s possession of the contested lot is far too short of the prescriptive period of 30 years, consider- ing that her possession is in bad faith. The ﬁling of the petition for recovery of ownership and possession and quieting of title by petitioners on Apr. 27, 1973 was well below the acquisitive prescriptive period for private respondent, which is 30 years under Art. 1141 of the present Civil Code. In this case, the statutory period of prescription is deemed to have commenced when petitioners were made aware of a claim adverse to them, i.e., when the afﬁdavit of adjudication was duly registered with the Registry of Deeds which, at the earliest may be considered to be in 1974, when private respondent was able to secure a tax declaration in her name. Art. 1142. A mortgage action prescribes after ten years. COMMENT: (1) Prescription of Mortgage Actions 10 years. 46 CIVIL CODE OF THE PHILIPPINES Art. 1143 (2) When Period Begins From what moment must the 10-year period be counted? From the day on which it could have been brought. (Art. 1150, Civil Code). Thus, if the parents of an employee should execute a real estate mortgage to secure a performance bond given by a surety company for their son, the period of prescription begins from the moment the surety company pays by reason of said bond because from said date, the mortgagors become liable, and foreclosure can be made. (Nabong v. Luzon Surety Co., Inc., L-10034, May 17, 1957). (3) Lands With a Torrens Title While lands with a Torrens Title cannot be acquired by prescription (Sec. 39, Act 496 and Rosario v. Aud. General, L-11817, Apr. 30, 1958), still the right to foreclose a mortgage on such lands does prescribe for what does not prescribe is the ownership of said lands. (4) Effect if Mortgage Is Registered Even if a mortgage is registered, the action to foreclose upon it may still prescribe. (Buhat v. Besana, 50 O.G. 4215, Sept. 1954). (5) Effect on Interest on Debt If a mortgage debt had already prescribed, so also has the action to recover interest thereon. (Soriano v. Enriquez, 24 Phil. 584). Art. 1143. The following rights among others speciﬁed elsewhere in this Code, are not extinguished by prescrip- tion: (1) To demand a right of way, regulated in Article 649; (2) To bring an action to abate a public or private nui- sance. COMMENT: (1) Rights Not Extinguished by Prescription (a) Two rights are indicated in the Article. [The ﬁrst right, the demanding of the right of way, would seem to cover 47 Art. 1143 CIVIL CODE OF THE PHILIPPINES also the right to demand a compulsory or legal easement of drainage. (See Art. 676, Civil Code).] (b) Reason for the non-prescriptibility: public policy. (2) Some Other Actions That Do Not Prescribe (a) The action to demand partition of a co-ownership (as long as the co-ownership has been expressly or implicitly rec- ognized). (Art. 494, Civil Code). Budiong v. Pandoc 79 SCRA 24 The right to demand partition does not prescribe. (See Art. 494 of the Civil Code). (b) The action (or the defense) for the declaration of contract of marriage as null and void or inexistent. (See Art. 1410; see also Banaga v. Soler, L-15717, Jun. 30, 1961). (c) The action to have a will probated (otherwise, the desires of the deceased, who cannot help himself, may be frustrated). (Guevara v. Guevara, et al., L-05405, Jan. 31, 1956). (d) The action for the quieting of title so long as the plaintiff is in possession of the property. (Sapto, et al. v. Fabiana, L-11285, May 6, 1958). (e) The right to demand support (present and future), but in- stallments on support in arrears may prescribe. (Trinidad Florencio v. Ruﬁno Organo, GR L-4037, Nov. 29, 1951). (f) Generally, an action to recover property expressly placed in trust (express trust) cannot prescribe in view of the con- ﬁdence reposed, UNLESS such trust has been repudiated unequivocally. However, constructive trusts are affected by prescription and laches in view of the lack of conﬁdence or ﬁduciary relations. (Diaz, et al. v. Garricho and Agriado, L-11229, Mar. 20, 1958; see Bachrach Motor Co. v. Lejano, L-10910, Jan. 16, 1959; see also comments under Art. 1456, this Volume). 48 CIVIL CODE OF THE PHILIPPINES Art. 1144 (g) An action to compel reconveyance of property with a Tor- rens Title does NOT prescribe if the registered owner had obtained registration in bad faith, and the property is still in the latter’s name. The reason is that the registration is in the nature of a continuing and subsisting trust. (Cala- diao v. Vda. de Blas, L-19063, Apr. 29, 1964). However, if the property has already passed to an innocent purchaser for value, the principle of imprescriptibility does not apply. (Ibid.). NOTE: In Gerona, et al. v. Carmen de Guzman, et al., L-19060, May 29, 1964, however, the Supreme Court stated that although there are some decisions to the con- trary, it is already settled that an action for reconveyance of real property based upon a constructive or implied trust, resulting from fraud, may be barred by prescription. The period is 4 years from the discovery of the fraud. (h) An action brought by a buyer of land to compel the seller to execute the proper deed of conveyance does NOT prescribe, provided that said buyer is still in POSSESSION. (See Castrillo v. Court of Appeals, L-18046, Mar. 31, 1964). (i) An action by the registered owner of land (protected by a Torrens Title) to recover possession of said land. (Act 496). (j) Case of Rodil Rodil v. Benedicto L-28616, Jan. 22, 1980 The right of the applicant for registered land (or the purchaser thereof) to ask for the writ of possession does not prescribe. Art. 1144. The following actions must be brought within ten years from the time the right of action accrues: (1) Upon a written contract; (2) Upon an obligation created by law; (3) Upon a judgment. 49 Art. 1144 CIVIL CODE OF THE PHILIPPINES COMMENT: (1) Actions That Prescribe in 10 Years The Article enumerates three kinds. Other actions that prescribe in 10 years include the follow- ing: (a) action to recover de jure possession of real property from a possessor in good faith. (Art. 555, Civil Code; also Art. 1141, par. 2, in relation to Art. 1134, Civil Code). (b) a real mortgage action. (Art. 1142, Civil Code). [NOTE: An action to annul a marriage on the ground of impotency prescribes in eight (8) years, counted from the cel- ebration of the marriage. (Art. 87, par. 6, Civil Code).] Veloso v. Workmen’s Compensation Commission 78 SCRA 503 The liability of an employer for compensation cases un- der the Workmen’s Compensation Law prescribes in ten (10) years. Negre v. Workmen’s Compensation Commission GR 43795, Apr. 15, 1985 A workmen’s compensation claim ﬁled 8 years after the employee’s death is well within the statutory period to ﬁle a compensation claim, which is 10 years. Villamor v. CA GR 97332, Oct. 10, 1991 Under Article 1144(1) of the Civil Code, actions upon a written contract must be brought within ten (10) years. The deed of option was executed on Nov. 11, 1971. The acceptance was also made in the same instrument. The complaint was ﬁled by Villamor on Jul. 13, 1987, 17 years from the time of the execu- tion of the contract. Hence, the right of action had prescribed. There were allegations by Villamor that they demanded from Reyes as early as 1984 the enforcement of their rights under the 50 CIVIL CODE OF THE PHILIPPINES Art. 1144 contract. Still, it was beyond the ten (10)-year period prescribed by the Civil Code. It is of judicial notice that the price of real estate in Metro Manila is continuously on the rise. To allow Villamor to demand the delivery of the property subject of this case 13 years or 17 years after the execution of the deed at the price of only P70 per square meter is inequitous. For reasons of equity and in consideration of the fact that Reyes has no other decent place to live in, the Court in the exercise of equity jurisdiction, is not inclined to grant Villamor’s prayer. (2) Example of a Written Contract A passenger of a ship, or his heirs, can bring an action based on culpa contractual within a period of 10 years because the TICKET issued for the transportation is by itself a COM- PLETE WRITTEN CONTRACT. (Peralta de Guerrero, et al. v. Madrigal Shipping Co., L-12951, Nov. 17, 1959). [NOTE: An action for the reformation of a written contract prescribes in ten (10) years. (Jayme v. Judge Nestor Alampay, L-39592, Jan. 28, 1975).] (NOTE: In this case, the Court held that “although the complaint does not state that the transportation was under- taken by virtue of a written contract of carriage, nevertheless this can be implied from the complaint because it is a matter of common knowledge that whenever a passenger boards a ship for transportation from one place to another, he is issued a ticket wherein the terms of the contract are speciﬁed.”) (3) Examples of Obligations Created by Law (a) The obligation to pay indemnity for a legal right of way. (If the right of way of a public road was acquired in 1914, the claim for payment of the same brought to the Auditor- General only in 1955 has prescribed, especially where, due to the loss of the papers during the war, the Government cannot be sure that no payment has been made). (Rosario v. Auditor-General, L-11817, Apr. 30, 1958). (b) An action to recover compensation for the death of a worker or employee, being an action based on law, prescribes in 51 Art. 1144 CIVIL CODE OF THE PHILIPPINES 10 years, in the absence of any speciﬁc provision of law on the matter. (Under the former law, Act 190, said action prescribed after 6 years). (Pan Phil. Corp. v. Workmen’s Compensation Com. and Frias, L-9807, Apr. 17, 1957). [NOTE: In the Pan Phil. Corporation case, the death occurred on Dec. 25, 1945. The claim was ﬁled with the Workmen’s Compensation Division of the Bureau of Labor

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