PROPERTY

LADERA vs. HODGES (Vol. 48 No. 12 Official Gazette 5374) MINDANAO BUS CO. vs. CITY ASSESSOR AND TREASURER (G.R. No. L-17870, Sept. 29, 1962)
FACTS: FACTS:
Hodges entered into a contract promising to sell a lot to Ladera under certain terms and Petitioner is a public utility company engaged in the transport of passengers and cargo by
conditions. One of which is that the contract may be rescinded and annulled in case Ladera motor vehicles in Mindanao with main offices in Cagayan de Oro (CDO). Petitioner likewise
failed to make the monthly payment 60 days after it is due. After the execution of the owned a land where it maintains a garage, a repair shop and blacksmith or carpentry shops.
contract, Ladera built a house on the lot assessed at 4,500 pesos. However, Ladera failed to The machineries are placed thereon in wooden and cement platforms. The City Assessor of
pay the agreed installments so Hodges rescinded the contract and filed an action for CDO then assessed a P4,400 realty tax on said machineries and repair equipment. Petitioner
ejectment. The MTC ruled in favor of Hodges and issued an alias writ of execution. Pursuant appealed to the Board of Tax Appeals but it sustained the City Assessor's decision, while the
thereto, the sheriff levied upon all rights, interests and participation over the house. Notices Court of Tax Appeals (CTA) sustained the same.
of sale were posted, however, were not published in a newspaper of general circulation. An
auction sale was then conducted but Ladera was not able to attend as she had gone to ISSUE:
Manila. The house was then sold to one Avelina Magno as the highest bidder. Meanwhile, Whether or not the machineries and equipments are considered immobilized and thus
Ladera sold the same lot to one Manuel Villa and on the same day purchased the house from subject to a realty tax
Magno for 200 pesos. This, however, was not recorded. Ladera then returned to Iloilo and
learned what happened. She went to see the sheriff and represented that the property can HELD:
still be redeemed and so she gave him 230 pesos. It does not appear, however, that it was The Supreme Court decided otherwise and held that said machineries and equipments are
turned over to Hodges. Thereupon, Ladera filed an action against Hodges, the sheriff, Magno not subject to the assessment of real estate tax.
and Villa to set aside the sale and recover the house. The lower court ruled in favor of Ladera Said equipments are not considered immobilized as they are merely incidental, not esential
on the ground of non-compliance based on Rule 39 of the Rules of Court. On appeal, Hodges and principal to the business of the petitioner. The transportation business could be carried
contends that the house, built on a lot owned by another, should be regarded as movable or on without repair or service shops of its rolling equipment as they can be repaired or services
personal property. The sale of the land was also made without proper publication required in another shop belonging to another
by law.

ISSUE: MAKATI LEASING & FINANCE CORP. vs. WEAREVER TEXTILE MILLS, INC. (G.R. No. L-58469,
Was the house movable or immovable? May 16, 1983)
FACTS:
HELD: Wearever Textile Mills, Inc. executed a chattel mortgage contract in favor of Makati Leasing
Immovable. As enumerated in the Civil Code, immovable property includes lands, buildings, and Finance Corporation covering certain raw materials and machinery. Upon default, Makati
roads and constructions of all kinds adhered to the soil. The law does not make any Leasing fi led a petition for judicial foreclosure of the properties mortgaged. Acting on Makati
distinction whether or not the owner of the lot was the one who built the construction. Also, Leasing’s application for replevin, the lower court issued a writ of seizure. Pursuant thereto,
Ladera did not declare his house to be a chattel mortgage. The object of the levy or sale was the sheriff enforcing the seizure order seized the machinery subject matter of the mortgage.
real property and its publication in a newspaper of general circulation was indespensible. In a petition for certiorari and prohibition, the Court of Appeals ordered the return of the
Without it, the execution sale was void. In addition, Magno, the alleged purchaser at the machinery on the ground that the same can-not be the subject of replevin because it is a real
auction sale, was a mere employee of Hodges and the low bid made by her as well as the fact property pursuant to Article415 of the new Civil Code, the same being attached to the
that she sold the house to Villa on the same day Hodges sold him the land, proves that she ground by means of bolts and the only way to remove it from Wearever textile’s plant would
was merely acting for and in behalf of Hodges. In the sale of immovables, the lack of title of be to drill out or destroy the concrete fl oor. When the motion for reconsideration of Makati
the vendor taints the rights of the subsequent purchasers. Possession in good faith is not Leasing was denied by the Court of Appeals, Makati Leasing elevated the matter to the
equivalent to title. The principles of accession regard buildings and constructions as mere Supreme Court.
accessories to the land on which it is built, it is logical that said accessories should partake
the nature of the principal thing.
ISSUE: execution issued in said case on 8 October 1951. The corresponding definite deed of sale was
Whether the machinery in suit is real or personal property from the point of view of the issued to him on 22 October 1952, upon expiration of the period of redemption. When
parties. Evangelista sought to take possession of the house, Rivera refused to surrender it, upon the
ground that he had leased the property from the Alto Surety & Insurance Co., Inc. and that
HELD: the latter is now the true owner of said property. It appears that on 10 May 1952, a definite
There is no logical justification to exclude the rule out the present case from the application deed of sale of the same house had been issued to Alto Surety, as the highest bidder at an
of the pronouncement in Tumalad v Vicencio, 41 SCRA 143. If a house of strong materials, auction sale held, on 29 September 1950, in compliance with a writ of execution issued in
like what was involved in the Tumalad case, may be considered as personal property for Civil Case 6268 of the same court (Alto Surety & Insurance vs. Maximo Quiambao, Rosario
purposes of executing a chattel mortgage thereon as long as theparties to the contract so Guevara and Ricardo Rivera)" in which judgment for the sum of money, had been rendered in
agree and no innocent third party will be prejudiced thereby, there is absolutely no reason favor of Alto Surety. Hence, on 13 June 1953, Evangelista instituted an action against Alto
why a machinery, which is movable in its nature and becomesimmobilized only by destination Surety and Ricardo Rivera, for the purpose of establishing his title over said house, and
or purpose, may not be likewise treated as such. This is really because one who has so securing possession thereof, apart from recovering damages. After due trial, the CFI Manila
agreed is estopped from the denying the existence of the chattel mortgage. rendered judgment for Evangelista, sentencing Rivera and Alto Surety to deliver the house in
In rejecting petitioner’s assertion on the applicability of the Tumalad doctrine, the CA lays question to Evangelista and to pay him, jointly and severally, P40.00 a month from October
stress on the fact that the house involved therein was built on a land that did not belong to 1952, until said delivery. The decision was however reversed by the Court of Appeals, which
the owner of such house. But the law makes no distinction with respect to the ownership of absolved Alto Surety from the complaint on account that although the writ of attachment in
the land on which the house is built and We should not lay down distinctions not favor of Evangelista had been filed with the Register of Deeds of Manila prior to the sale in
contemplated by law. favor of Alto Surety, Evangelista did not acquire thereby a preferential lien, the attachment
It must be pointed out that the characterization by the private respondent is indicative of the having been levied as if the house in question were immovable property. 
intention and impresses upon the property the character determined by the parties. As stated
in Standard Oil Co. of New York v. Jaramillo, 44 Phil. 630, it is undeniable that the parties to a ISSUE:
contract may, by agreement, treat as personal property that which by nature would be a real Whether or not a house constructed by the lessee of the land on which it is built, should be
property as long as no interest of third parties would be prejudiced thereby. dealt with, for purpose of attachment, as immovable property? 
The status of the subject matter as movable or immovable property was not raised as an
issue before the lower court and the CA, except in a supplemental memorandum in support HELD:
of the petition filed in the appellate court. There is no record showing that the mortgage has The court ruled that the house is not personal property, much less a debt, credit or other
been annulled, or that steps were taken to nullify the same. On the other hand, respondent personal property not capable of manual delivery, but immovable property. As held in
has benefited from the said contract. Laddera vs. Hodges (48 OG 5374), "a true building is immovable or real property, whether it
Equity dictates that one should not benefit at the expense of another. is erected by the owner of the land or by a usufructuary or lessee.” The opinion that the
As such, private respondent could no longer be allowed to impugn the efficacy of the chattel house of Rivera should have been attached, as "personal property capable of manual
mortgage after it has benefited therefrom. delivery, by taking and safely keeping in his custody", for it declared that "Evangelista could
Therefore, the questioned machinery should be considered as personal property. not have validly purchased Ricardo Rivera's house from the sheriff as the latter was not in
possession thereof at the time he sold it at a public auction” is untenable. Parties to a deed
SANTOS EVANGELISTA vs. ALTO SURETY & INSURANCE CO., INC. (G.R. No. L-11139, Apr. 23, of chattel mortgage may agree to consider a house as personal property for purposes of said
1958) contract. However, this view is good only insofar as the contracting parties are concerned. It
FACTS: is based, partly, upon the principle of estoppel. Neither this principle, nor said view, is
In 1949, Santos Evangelista instituted Civil Case No. 8235 of the CFI Manila (Santos applicable to strangers to said contract. The rules on execution do not allow, and should not
Evangelista vs. Ricardo Rivera) for a sum of money. On the same date, he obtained a writ of be interpreted as to allow, the special consideration that parties to a contract may have
attachment, which was levied upon a house, built by Rivera on a land situated in Manila and desired to impart to real estate as personal property, when they are not ordinarily so. Sales
leased to him, by filing copy of said writ and the corresponding notice of attachment with the on execution affect the public and third persons. The regulation governing sales on execution
Office of the Register of Deeds of Manila. In due course, judgment was rendered in favor of are for public officials to follow. The form of proceedings prescribed for each kind of property
Evangelista, who bought the house at public auction held in compliance with the writ of is suited to its character, not to the character which the parties have given to it or desire to
give it. The regulations were never intended to suit the consideration that parties, may have
privately given to the property levied upon. The court therefore affirms the decision of the
CA with cost against Alto Surety