MANILA ELECTRIC VS.

ASSESSOR

Summary:

MERALCO argues that it is not liable for real property tax on its transformers, electric posts (or poles),
transmission lines, insulators, and electric meters, beginning 1992.

Doctrine:

It is settled that tax exemptions must be clear and unequivocal. A taxpayer claiming a tax exemption must point to
a specific provision of law conferring on the taxpayer, in clear and plain terms, exemption from a common burden.
Any doubt whether a tax exemption exists is resolved against the taxpayer.

It is a basic precept of statutory construction that the express mention of one person, thing, act, or consequence
excludes all others as expressed in the familiar maxim expressio unius est exclusio alterius.

Facts:

MERALCO is a private corporation organized and existing under Philippine laws to operate as a public utility
engaged in electric distribution. MERALCO has been successively granted franchises to operate in Lucena City
beginning 1922 until present time.

On February 20, 1989, MERALCO received from the City Assessor of Lucena a copy of Tax Declaration No. 019-
650013 covering the following electric facilities, classified as capital investment, of the company: (a) transformer
and electric post; (b) transmission line; (c) insulator; and (d) electric meter, located in Quezon Ave. Ext., Brgy.
Gulang-Gulang, Lucena City. Under Tax Declaration No. 019-6500, these electric facilities were subjected to real
property tax as of 1985.

MERALCO appealed Tax Declaration No. 019-6500 before the LBAA of Lucena City, which was docketed as LBAA-
89-2. MERALCO claimed that its capital investment consisted only of its substation facilities and that MERALCO
was exempted from payment of real property tax on said substation facilities.

The Local Board of Assessment Appeals cited the 1964 case of Board of Assessment Appeals v. Manila Electric
Company16 (1964 MERALCO case) in which the Court held that: (1) the steel towers fell within the term "poles"
expressly exempted from taxes under the franchise of MERALCO; and (2) the steel towers were personal
properties under the provisions of the Civil Code and, hence, not subject to real property tax.

The City Assessor of Lucena filed an appeal with the Central Board of Assessment Appeals (CBAA), which was
docketed as CBAA Case No. 248. The CBAA affirmed the assailed LBAA judgment. Apparently, the City Assessor of
Lucena no longer appealed said CBAA Decision and it became final and executory.

Six years later, on October 29, 1997, MERALCO received a letter dated October 16, 1997 from the City Treasurer of
Lucena, which stated that the company was being assessed real property tax delinquency on its machineries
beginning 1990.

MERALCO appealed Tax Declaration Nos. 019-6500 and 019-7394 before the LBAA of Lucena City on December 23,
1997 and posted a surety bond dated December 10, 1997 to guarantee payment of its real property tax
delinquency.
RULING OF LBAA:

In its Decision dated June 17, 1998 regarding Tax Declaration Nos. 019-6500 and 019-7394, the LBAA declared that
Sections 234 and 534(f) of the Local Government Code repealed the provisions in the franchise of MERALCO and
Presidential Decree No. 551 pertaining to the exemption of MERALCO from payment of real property tax on its
poles, wires, insulators, transformers, and meters. The LBAA refused to apply as res judicata its earlier judgment
in LBAA-89-2, as affirmed by the CBAA, because it involved collection of taxes from 1985 to 1989, while the
present case concerned the collection of taxes from 1989 to 1997.

RULING OF CBAA:

The CBAA, in its Decision dated May 3, 2001, agreed with the LBAA that MERALCO could no longer claim
exemption from real property tax on its machineries with the enactment of Republic Act No. 7160, otherwise
known as the Local Government Code of 1991.

MERALCO filed a petition for Review under Rule 43 of the ROC with the CA.

CA DECISION:

The Court of Appeals further ruled that there was no more basis for the real property tax exemption of MERALCO
under the Local Government Code and that the withdrawal of said exemption did not violate the non-impairment
clause of the Constitution.

Issues Ratio:

1. Whether or not the transformers, electric posts, transmission lines, insulators and electric meters are subject to
real property tax

Held:

YES.

The Court finds that the transformers, electric posts, transmission lines, insulators, and electric meters of
MERALCO are no longer exempted from real property tax and may qualify as "machinery" subject to real property
tax under the Local Government Code.

The decisions in CBAA Case No. 248 and the 1964 MERALCO case recognizing the exemption from real property tax
of the transformers, electric posts, transmission lines, insulators, and electric meters of MERALCO are no longer
applicable.
In the 1964 MERALCO case, the City Assessor of Quezon City considered the steel towers of MERALCO as real
property and required MERALCO to pay real property taxes for the said steel towers for the years 1952 to 1956.
MERALCO was operating pursuant to the franchise granted under Ordinance No. 44 of the Municipal Board of
Manila. Under its franchise, MERALCO was expressly granted tax exemption privilege.

Similarly, it was clear that under the 20-year franchise granted to MERALCO by the Municipal Board of Lucena City
through Resolution No. 2679 dated June 13, 1972, the transformers, electric posts, transmission lines, insulators,
and electric meters of MERALCO were exempt from real property tax.

The CBAA in its Decision dated April 10, 1991 in CBAA Case No. 248 sustained the exemption of the said properties
of MERALCO from real property tax on the basis of paragraph 13 of Resolution No. 2679 and the 1964 MERALCO
case.

Just when the franchise of MERALCO in Lucena City was about to expire, the Local Government Code took effect
on January 1, 1992 Sections 193 and 234 of which provide:

Section 193. Withdrawal of Tax Exemption Privileges. - Unless otherwise provided in this Code, tax exemptions or
incentives granted to, or presently enjoyed by all persons, whether natural or juridical, including government-
owned or controlled corporations, except local water districts, cooperatives duly registered under R.A. No. 6938,
non-stock and nonprofit hospitals and educational institutions, are hereby withdrawn upon the effectivity of this
Code.

Taking into account the above-mentioned provisions, the evident intent of the Local Government Code is to
withdraw/repeal all exemptions from local taxes, unless otherwise provided by the Code.

Section 234. Exemptions from Real Property Tax. - The following are exempted from payment of the real property
tax:

(a) Real property owned by the Republic of the Philippines or any of its political subdivisions except when the
beneficial use thereof has been granted, for consideration or otherwise, to a taxable person;

(b) Charitable institutions, churches, parsonages or convents appurtenant thereto, mosques, nonprofit or religious
cemeteries and all lands, buildings, and improvements actually, directly, and exclusively used for religious,
charitable or educational purposes;

(c) All machineries and equipment that are actually, directly and exclusively used by local water districts and
government-owned or controlled corporations engaged in the supply and distribution of water and/or generation
and transmission of electric power;

(d) All real property owned by duly registered cooperatives as provided for under R.A. No. 6938; and

(e) Machinery and equipment used for pollution control and environmental protection.

Except as provided herein, any exemption from payment of real property tax previously granted to, or presently
enjoyed by, all persons, whether natural or juridical, including all government-owned or controlled corporations
are hereby withdrawn upon the effectivity of this Code
The last paragraph of Section 234 had unequivocally withdrawn, upon the effectivity of the Local Government
Code, exemptions from payment of real property taxes granted to natural or juridical persons, including
government-owned or controlled corporations, except as provided in the same section.

2. Whether or not the Local Government Code is controlling in determining whether machinery is real property
subject to real property tax

YES

Under Section 199(o) of the Local Government Code, machinery, to be deemed real property subject to real
property tax, need no longer be annexed to the land or building as these "may or may not be attached,
permanently or temporarily to the real property," and in fact, such machinery may even be "mobile."

The same provision though requires that to be machinery subject to real property tax, the physical facilities for
production, installations, and appurtenant service facilities, those which are mobile, self-powered or self-
propelled, or not permanently attached to the real property (a) must be actually, directly, and exclusively used to
meet the needs of the particular industry, business, or activity; and (b) by their very nature and purpose, are
designed for, or necessary for manufacturing, mining, logging, commercial, industrial, or agricultural purposes.

Article 415, paragraph (1) of the Civil Code declares as immovables or real properties "[l]and, buildings, roads and
constructions of all kinds adhered to the soil." The land, buildings, and roads are immovables by nature "which
cannot be moved from place to place," whereas the constructions adhered to the soil are immovables by
incorporation "which are essentially movables, but are attached to an immovable in such manner as to be an
integral part thereof." Article 415, paragraph (3) of the Civil Code, referring to "[ejverything attached to an
immovable in a fixed manner, in such a way that it cannot be separated therefrom without breaking the material
or deterioration of the object," are likewise immovables by incorporation. In contrast, the Local Government Code
considers as real property machinery which "may or may not be attached, permanently or temporarily to the real
property," and even those which are "mobile."

Article 415, paragraph (5) of the Civil Code considers as immovables or real properties "[machinery, receptacles,
instruments or implements intended by the owner of the tenement for an industry or works which may be carried
on in a building or on a piece of land, and which tend directly to meet the needs of the said industry or works."
The Civil Code, however, does not define "machinery." These properties, including machinery, become
immobilized if the following requisites concur: (a) they are placed in the tenement by the owner of such
tenement; (b) they are destined for use in the industry or work in the tenement; and (c) they tend to directly meet
the needs of said industry or works. The first two requisites are not found anywhere in the Local Government
Code.

As between the Civil Code, a general law governing property and property relations, and the Local Government
Code, a special law granting local government units the power to impose real property tax, then the latter shall
prevail.

It is a finely-imbedded principle in statutory construction that a special provision or law prevails over a general
one. Lex specialis derogant generali

Therefore, for determining whether machinery is real property subject to real property tax, the definition and
requirements under the Local Government Code are controlling.

Dispositive:
WHEREFORE, premises considered, the Court PARTLY GRANTS the instant Petition and AFFIRMS with
MODIFICATION the Decision dated May 13, 2004 of the Court of Appeals in CA-G.R. SP No. 67027, affirming in toto
the Decision dated May 3, 2001 of the Central Board of Assessment Appeals in CBAA Case No. L-20-98.

Capitol Wireless Inc v The Provincial Treasurer of Batangas

Summary:

This is a petition for review on certiorari seeking to annul and set aside a Court of Appeals judgment denying the
appeal of the petitioner against the decision of the Regional Trial Court. The petitioner, Capitol Wireless Inc
(Capwire), is a Philippine corporation in the business of providing international telecommunications services. It
has signed agreements with other local and foreign telecommunications companies covering an international
network of submarine cable systems such as the Asia Pacific Cable Network System (APCN) (which connects
Australia, Thailand, Malaysia, Singapore, Hong Kong, Taiwan, Korea, Japan, Indonesia and the Philippines); the
Brunei-Malaysia-Philippines Cable Network System (BMP-CNS), the Philippines-Italy (SEA-ME-WE-3 CNS), and the
Guam-Philippines (GP-CNS) systems. The agreements provide for co-ownership and other rights among the parties
over the network.

Capwire claims that as co-owner, it does not own any particular physical part of the cable system but, consistent
with its financial contributions, it owns the right to use a certain capacity of the said system. This property right is
allegedly reported in its financial books as "Indefeasible Rights in Cable Systems."

Capwire claims that it is co-owner only of the so-called 'wet segment' of the APCN, while the landing stations or
terminals and Segment E of APCN located in Nasugbu, Batangas, are owned by PLDT. Moreover, it alleges that the
wet segment is laid in international, and not Philippine, waters. Capwire claims that it is therefore not liable to
pay taxes on the cable system as determined by the Provincial Assessor.

Moreover, it alleges that the Wet Segment is laid in international, and not Philippine waters. For loan
restructuring purposes, petitioner engaged an appraiser to assess the market value of the international submarine
cable system and the cost to CapWire. It then submitted a Sworn Statement of True Value of Real Properties at
the Provincial Treasurer’s Office in Batangas City, for the Wet Segment of the system . Respondent Provincial
Assessor of Batangas had determined that the submarine cable systems described in CapWire’s Sworn Statement
are taxable real property. Petitioner contested this by reasoning that the cable system lies outside of Philippine
territory i.e. international waters. Petitioner received a Warrant of Levy and a Notice of Auction Sale from
respondent.

Petitioner filed a Petition for Prohibition and Declaration of Nullity of Warrant of Levy, Notice of Auction Sale
and/or Auction Sale with the RTC of Batangas City.

RTC issued an order dismissing the petition: (1) for failure to follow the requisite of payment under protest; as
well as (2) failure to appeal to the Local Board of Assessment Appeals (LBAA), as provided for in Sections 206 and
226 of R.A. 7160 or the Local Government Code. The Court of Appeals sustained the ruling of the RTC – for
petitioner failed to avail of remedies before administrative bodies like the LBAA and the Central Board of
Assessment Appeals (CBAA).

Petitioner claims that its petition raises purely legal questions, but the C.A.
noted that the case raises questions of fact, such as the extent to which parts of the submarine cable system lie
within the territorial jurisdiction of the taxing authorities, the public respondents.

Issue:

Whether the submarine communications cable classified as taxabale real property by the Local Government.

Held:
Yes. Submarine or undersea communications cables are akin to electric transmission lines which this Court has
recently declared in Manila Electric Company v. City Assessor and City Treasurer of Lucena City as "no longer
exempted from real property tax" and may qualify as "machinery" subject to real property tax under the Local
Government Code. To the extent that the equipment's location is determinable to be within the taxing authority's
jurisdiction, the Court sees no reason to distinguish between submarine cables used for communications and
aerial or underground wires or lines used for electric transmission, so that both pieces of property do not merit a
different treatment in the aspect of real property taxation. Both electric lines and communications cables, in the
strictest sense, are not directly adhered to the soil but pass through posts, relays or landing stations, but both
may be classified under the term "machinery" as real property under Article 415(5) of the Civil Code for the simple
reason that such pieces of equipment serve the owner's business or tend to meet the needs of his industry or
works that are on real estate. Even objects in or on a body of water may be classified as such, as "waters" is
classified as an immovable under Article 415(8) of the Code. A classic example is a boathouse which, by its nature,
is a vessel and, therefore, a personal property but, if it is tied to the shore and used as a residence, and since it
floats on waters which is immovable, is considered real property. Besides, the Court has already held that "it is a
familiar phenomenon to see things classed as real property for purposes of taxation which on general principle
might be considered personal property."

Thus, absent any showing from Capwire of any express grant of an exemption for its lines and cables from real
property taxation, then this interpretation applies and Capwire's submarine cable may be held subject to real
property tax.
REPUBLIC OF THE PHILIPPINES vs. BANTIGUE POINT DEVELOPMENT CORPORATION

G. R. No. 162322

March 14, 2012

FACTS:

Respondent filed with the RTC of Rosario, Batangas an application for original registration of title over a parcel of
land located at Barangay Barualte, San Juan, Batangas. Petitioner Republic filed its Opposition to the application
for registration while the records were still with the RTC. The RTC Clerk of Court transmitted motu proprio the
records of the case to the MTC of San Juan, because the assessed value of the property was allegedly less than
₱100,000. Thereafter, the MTC entered an Order of General Default and commenced with the reception of
evidence. Among the documents presented by respondent in support of its application are Tax Declarations, a
Deed of Absolute Sale in its favour, and a Certification from the DENR Community Environment and Natural
Resources Office (CENRO) of Batangas City that the lot in question is within the alienable and disposable zone.
Thereafter, it awarded the land to respondent Corporation.

Acting on an appeal filed by the Republic, the CA ruled that since the petitioner had actively participated in the
proceedings before the lower court, but failed to raise the jurisdictional challenge, petitioner is thereby estopped
from questioning the jurisdiction of the lower court on appeal.

The CA further found that respondent Corporation had sufficiently established the latter’s registrable title over the
subject property after having proven open, continuous, exclusive and notorious possession and occupation of the
subject land by itself and its predecessors-in-interest even before the outbreak of World War II. Dissatisfied with
the CA’s ruling, petitioner Republic filed this instant Rule 45 Petition and raised the following arguments in
support of its appeal that the MTC failed to acquire jurisdiction over the application for original registration of
land title. The CA upheld the jurisdiction of the MTC, but remanded the case to the court a quo for further
proceedings in order to determine if the property in question forms part of the alienable and disposable land of
the public domain.

ISSUE:

WON the Republic of the Philippines is estopped from questioning the jurisdiction of the MTC over the land
registration case

WON the property in question is alienable and disposable land of public domain.

RULING:

Petition is DENIED.

Petitioner is not estopped from questioning the jurisdiction of the lower court, even if the former raised the
jurisdictional question only on appeal. The rule is settled that lack of jurisdiction over the subject matter may be
raised at any stage of the proceedings. It is conferred only by the Constitution or the law. It cannot be acquired
through a waiver or enlarged by the omission of the parties or conferred by the acquiescence of the court.
Consequently, questions of jurisdiction may be cognizable even if raised for the first time on appeal. The CA’s
ruling with regards to questioning jurisdiction upon active participation of the ROP is based on the doctrine of
estoppel by laches. The MTC properly acquired jurisdiction over the case. In assailing the jurisdiction of the lower
courts, petitioner Republic raised two points of contention: (a) the period for setting the date and hour of the
initial hearing; and (b) the value of the land to be registered.

First, petitioner argued that the lower court failed to acquire jurisdiction over the application, because the RTC set
the date and hour of the initial hearing beyond the 90-day period provided under the Property Registration
Decree. While the date set by the RTC was beyond the 90-day period provided for in Section 23, this fact did not
affect the jurisdiction of the trial court. We ruled that the lapse of time between the issuance of the Order setting
the date of initial hearing and the date of the initial hearing itself was not fatal to the application. The RTC’s
failure to issue the Order setting the date and hour of the initial hearing within five days from the filing of the
application for registration, as provided in the Property Registration Decree, did not affect the court’s its
jurisdiction. Observance of the five-day period was merely directory, and failure to issue the Order within that
period did not deprive the RTC of its jurisdiction over the case. However, the MTC had jurisdiction because the
value of the lot in this case does not exceed ₱100,000.

A certification from the CENRO is not sufficient proof that the property in question is alienable and disposable
land of the public domain. Even as we affirm the propriety of the MTC’s exercise of its delegated jurisdiction, we
find that the lower court erred in granting respondent Corporation’s application for original registration in the
absence of sufficient proof that the property in question was alienable and disposable land of the public domain.
The applicant must also show sufficient proof that the DENR Secretary has approved the land classification and
released the land in question as alienable and disposable.

The Regalian doctrine dictates that all lands of the public domain belong to the State. The applicant for land
registration has the burden of overcoming the presumption of State ownership by establishing through
incontrovertible evidence that the land sought to be registered is alienable or disposable based on a positive act
of the government.

Thus, the present rule is that an application for original registration must be accompanied by (1) a CENRO or
PENRO48 Certification; and (2) a copy of the original classification approved by the DENR Secretary and certified as
a true copy by the legal custodian of the official records. Here, respondent Corporation only presented a CENRO
certification in support of its application. Clearly, this falls short of the requirements for original registration.

Secretary of DENR vs Yap

Natural Resources and Environmental Laws: Regalian Doctrine

GR No. 167707; Oct 8, 2008

FACTS:

This petition is for a review on certiorari of the decision of the Court of Appeals (CA) affirming that of the Regional
Trial Court (RTC) in Kalibo Aklan, which granted the petition for declaratory relief filed by respondents-claimants
Mayor Jose Yap et al, and ordered the survey of Boracay for titling purposes.

On Nov. 10, 1978, President Marcos issued Proclamation No. 1801 declaring Boracay Island as a tourist zone and
marine reserve. Claiming that Proc. No. 1801 precluded them from filing an application for a judicial confirmation
of imperfect title or survey of land for titling purposes, respondents-claimants filed a petition for declaratory relief
with the RTC in Kalibo, Aklan.

The Republic, through the Office of the Solicitor General (OSG) opposed the petition countering that Boracay
Island was an unclassified land of the public domain. It formed part of the mass of lands classified as “public
forest,” which was not available for disposition pursuant to section 3(a) of PD No. 705 or the Revised Forestry
Code.

ISSUE:

Whether Boracay Island is classified as alienable and disposable.

HELD:

No. To prove that the land subject of an application for registration is alienable, the applicant must establish the
existence of a positive act of the government such as a presidential proclamation or an executive order, an
administrative action, investigative reports of the Bureau of Lands investigators, and a legislative act or statute.
A positive act declaring land as alienable and disposable is required. In keeping with the presumption of state
ownership, the Court has time and again emphasized that there must be a positive act of the government, such as
an official proclamation, declassifying inalienable public land into disposable land for agricultural or other
purposes.

The Regalian Doctrine dictates that all lands of the public domain belong to the State, that the State is the source
of any asserted right to ownership of land and charged with the conservation of such patrimony.

All lands not otherwise appearing to be clearly within private ownership are presumed to belong to the State.
Thus, all lands that have not been acquired from the government, either by purchase or by grant, belong to the
State as part of the inalienable public domain.

Castillo v Escutin (2009, G.R. No. 171056)

Dinah C. Castillo v. Antonio Escutin et al.

March 13, 2009, G.R. No. 171056

Castillo's tax declaration was cancelled and around the same time, Summit Realty's TCT over the same lot was
issued based on the title of Catigbac. As ROD and City Assessor's Office has processed the documents of Summit,
Castillo charged them with violation of RA 3019 on corrupt practices. SC: the title of Catigbac has superior right
over the tax declaration of Castillo. Absent any sign of irregularities, the officers cannot be charged with corrupt
practices.

Facts:

Castillo filed charges against the respondents for violation of RA 3019 for allegedly cancelling her TCT in favor of
Summit Realty. Castillo was a judgement credit of Moratilla, and to satisfy said judgment Castillo went after Lot
13713 co-owned by Moratilla. Said lot was part of the area which Summit applied for conversion from agricultural
landholding to residential, commercial, and recreational uses.

To satisfy the judgment credit, said lot was subject to public auction sale in May 2002, and Castillo bought 1/3
pro-indiviso share of the lot. Castillo then obtained Tax Declaration 00942-A for the same. When Castillo
attempted to pay real estate taxes, she found out that her TD was cancelled, and the area was encompassed in
TCT No. 129642 and TD 00949-A in the name of Francisco Catigbac, and supposedly sold to Summit.

In July 2002, TCT 129642 was cancelled and TCT T-134609 was issued in favor of Summit. As such, Castillo
charted several public officers for the said cancellation and transfer of ownership of the subject lot.

Issue: W/N the tax declaration of Castillo can be cancelled on the basis of Section 109 of PD 1529.

Held:

Petition has no merit. Section 109 provides for the issuance of a lost duplicate certificate of title, and not related
to the cancellation of Castillo's tax declaration.

The cancellation of Castillo's TD was based on the fact that the same lot is covered by TCT 181 and subsequently
by TCT No. 129642.
 Accordingly, Summit bought Lot 1-B from Catigbac (through his AIF, Yagin), and thus TCT No. 181 in the name of
Catigbac was issued covering the purchased lot, on which the sale was registered in Summit's favor. Lot 1-B was
separated from Lot 1, and TCT 129642 was issued in the name of Catigbac and then the same was cancelled and
replaced by TCT No. T-134609 in the name of Summit. Since Lot 1-B is already covered by a tax declaration in the
name of Catigbac, accordingly, any other tax declaration for the same property or portion thereof in the name of
another person, not supported by any certificate of title, such that of petitioner, must be cancelled; otherwise, the
City Assessor would be twice collecting a realty tax from different persons on one and the same property.

Title v Certificate of title

Title: lawful cause or ground of possessing that which is ours the foundation of ownership of property (real or
personal) that which constitutes a just cause of exclusive possession Certificate of Title: mere evidence of
ownership not the title of the land itself.
Villarico v. Sarmiento, 442 SCRA 110, 115 2004

FACTS:

Spouses Villarico sought for the confirmation of title over a parcel of land to which they allege that they absolutely
own the land. This was opposed to by a person who posed himself also to be the rightful owner of the land, as
well as by the Director of Forestry who said that the subject land is part of forest land and may not be
appropriated. Trial and appellate court dismissed application of petitioners.

ISSUE:

Whether or not the plaintiff-appellant has acquired a right of way over the land of the government which is
between his property and the ninoy aquino avenue.

RULING:

There has been no showing that a declassification has been made of the land in question as disposable or
alienable. And the record indeed disclosed that applicants have not introduced any evidence which would
have led the court a quo to rule otherwise.

Forest lands cannot be owned by private persons. Possession thereof, no matter how long doesn’t ripen to a
registrable title. The adverse possession which may be the basis of a grant or title or confirmation of an imperfect
title refers only to alienable or disposable portions of the public domain.

Heirs | of Malabanan vs Republic (2013)Summary

Cases: Heirs of Malabanan vs. Republic of the Philippines (Resolution)●

Subject: Judicial Confirmation of Imperfect Title; Tacking of Period of Possession; Classifications of land according
to ownership; Classifications of public lands according to alienability; Disposition of Patrimonial Property of
the State.

Facts:

This is a motions for reconsideration of the parties who both assail the decision promulgated on April 29,2009,
whereby the Court denied the application for the registration of a parcel of land in Silang, Cavite on the ground
that petitioners (Malabanan) had not established by sufficient evidence their right to the registration in
accordance with either Section 14(1) or Section 14(2) of Presidential Decree No. 1529(Property Registration
Decree).The applicant Mario Malabanan, who had purchased the property from Eduardo Velazco, claimed that the
property formed part of the alienable and disposable land of the public domain, and that he and his predecessors-
in-interest had been in open, continuous, uninterrupted, public and adverse possession and occupation of the
land for more than 30 years, thereby entitling him to the judicial confirmation of his title To prove that the
property was an alienable and disposable land of the public domain, Malabanan presented during trial a
certification dated June 11, 2001 issued by the Community Environment and Natural Resources Office (CENRO) of
the DENR. The RTC granted Malabanan’s application for land registration. However, on appeal of the OSG, the
Court of Appeals (CA) reversed the ruling of the RTC. Noting that the CENRO-DENR certification stated that the
property had been declared alienable and disposable only on March 15, 1982, the CA, relying on the ruling in
Republic vs Herbieto, declared that Velazco’s possession prior to March 15, 1982 could not be tacked for purposes
of computing Malabanan’s period of possession. As earlier stated, the Supreme Court denied the petition for
review on certiorari because Malabanan failed to establish possession and occupation of the property on his part
and on the part of his predecessors-in interest since June 12, 1945, or earlier. Hence, this MR.

Held:
Petitioners failed to present sufficient evidence to establish that they and their predecessors-in-interest had been
in possession of the land since June 12, 1945. Without satisfying the requisite character and period of possession –
possession and occupation that is open, continuous, exclusive, and notorious since June 12, 1945, or earlier – the
land cannot be considered ipso jure converted to private property even upon the subsequent declaration of it as
alienable and disposable. Prescription never began to run against the State, such that the land has remained
ineligible for registration under Section 14(1) of the Property Registration Decree. Likewise, the land continues to
be ineligible for land registration under Section 14(2) of the Property Registration Decree unless Congress enacts a
law or the President issues a proclamation declaring the land as no longer intended for public service or for the
development of the national wealth.

G.R. No. 160453

REPUBLIC OF THE PHILIPPINES, Petitioner, vs.ARCADIO IVAN A. SANTOS III, and ARCADIO C. SANTOS, JR.,
Respondents.

BERSAMIN, J.:

FACTS:

Alleging continuous and adverse possession of more than ten years, respondent ArcadioIvan A. Santos III (Arcadio
Ivan) applied on March 7, 1997 for the registration of Lot4998-B (the property) in the Regional Trial Court (RTC) in
Parañaque City.

On May 21, 1998, Arcadio Ivan amended his application for land registration to include Arcadio, Jr. as his co-
applicant because of the latter’s co-ownership of the property. He alleged that the property had been formed
through accretion and had been in their joint open, notorious, public, continuous and adverse possession for more
than 30 years.

The City of Parañaque (the City) opposed the application for land registration, stating that it needed the property
for its flood control program; that the property was within the legal easement of 20 meters from the river bank;
and that assuming that the property was not covered by the legal easement, title to the property could not be
registered in favor of the applicants for the reason that the property was an orchard that had dried up and had
not resulted from accretion.

ISSUE:

Whether or not Article 457 of the Civil Code was applicable herein; and Whether or not respondents could claim
the property by virtue of acquisitive prescription pursuant to Section 14(1) of Presidential Decree No. 1529
(Property Registration Decree).

HELD:

Respondents as the applicants for land registration would be held entitled to claim the property as their own
and apply for its registration under the Torrens system only if they established that, indeed, the
property was an accretion to their land.

Respondents did not show that the gradual and imperceptible deposition of soil through the effects of the current
of the river had formed Lot 4998-B.Respondents as the riparian owners had no legal right to claim ownership of
Lot 4998-B.Considering that the clear and categorical language of Article 457 of the Civil Code has confined the
provision only to accretion, we should apply the provision as its clear and categorical language tells
us to.

The State exclusively owned Lot 4998-B and may not be divested of its right of ownership. Article
502 of the Civil Code expressly declares that rivers and their natural beds are public dominion of the State.

The State is its property of public dominion, unless there is an express law that provides that the dried-up river
beds should belong to some other person.
Under Articles 420(1) and 502(1) of the Civil Code, the Salunayan Creek, including its natural bed, is property of
the public domain which is not susceptible to private appropriation and acquisitive prescription. And, absent any
declaration by the government, that a portion of the creek has dried-up does not, by itself, alter its inalienable
character.

All river beds remain property of public dominion and cannot be acquired by acquisitive prescription unless
previously declared by the Government to be alienable and disposable. Considering that Lot 4998-B
was not shown to be already declared to be alienable and disposable, respondents could not be
deemed to have acquired the property through prescription.

To prove that the land subject of an application for registration is alienable, an applicant must conclusively
establish the existence of a positive act of the Government, such as a presidential proclamation,
executive order, administrative action, investigation reports of the Bureau of Lands investigator, or a legislative
act or statute. Until then, the rules on confirmation of imperfect title do not apply.

For the original registration of title, the applicant (petitioners in this case) must overcome the presumption that
the land sought to be registered forms part of the public domain. Unless public land is shown to have been
reclassified or alienated to a private person by the State, it remains part of the inalienable public domain.

The Court REVERSES and SETS ASIDE the decision of the Court of Appeals promulgated on May 27,
2003; DISMISSES the application for registration of Arcadio C. Santos, Jr. and Arcadio Ivan S. Santos III respecting
Lot 4998-B with a total area of 1,045 square meters, more or less, situated in Barangay San Dionisio,
Parañaque City, Metro Manila; and DECLARES Lot 4998-B as exclusively belonging to the State for being part
of the dried—up bed of the Parañaque River.

ANNOTATIONS:
 Accretion is the process whereby the soil is deposited along the banks of rivers. The
deposit of soil, to be considered accretion, must be:
(a) gradual and imperceptible;
(b) made through the effects of the current of the water; and
(c) taking place on land adjacent to the banks of rivers.
 In Celestial v. Cachopero, Since property of public dominion is outside the commerce of
man and not susceptible to private appropriation and acquisitive prescription, the adverse
possession which may be the basis of a grant of title in the confirmation of an imperfect
title refers only to alienable or disposable portions of the public domain.
 Under the Regalian doctrine, all lands not otherwise appearing to be clearly within
private ownership are presumed to belong to the State.
 No public land can be acquired by private persons without any grant, express or implied,
from the Government. It is indispensable, therefore, that there is a showing of a title from
the State. Occupation of public land in the concept of owner, no matter how long, cannot
ripen into ownership and be registered as a title.

ANNOTATIONS:
 Accretion is the process whereby the soil is deposited along the banks of rivers. The
deposit of soil, to be considered accretion, must be:
(a) gradual and imperceptible;
(b) made through the effects of the current of the water; and
(c) taking place on land adjacent to the banks of rivers.
 In Celestial v. Cachopero, Since property of public dominion is outside the commerce of
man and not susceptible to private appropriation and acquisitive prescription, the adverse
possession which may be the basis of a grant of title in the confirmation of an imperfect
title refers only to alienable or disposable portions of the public domain.
 Under the Regalian doctrine, all lands not otherwise appearing to be clearly within
private ownership are presumed to belong to the State.
 No public land can be acquired by private persons without any grant, express or implied,
from the Government. It is indispensable, therefore, that there is a showing of a title from
the State. Occupation of public land in the concept of owner, no matter how long, cannot
ripen into ownership and be registered as a title.
ANNOTATIONS:

Accretion is the process whereby the soil is deposited along the banks of rivers. Thedeposit of soil, to be
considered accretion, must be:

(a) gradual and imperceptible;

(b) made through the effects of the current of the water; and

(c) taking place on land adjacent to the banks of rivers.

In Celestial v. Cachopero, Since property of public dominion is outside the commerce of man and not susceptible
to private appropriation and acquisitive prescription, the adverse possession which may be the basis of a grant of
title in the confirmation of an imperfect title refers only to alienable or disposable portions of the public domain.

Under the Regalian doctrine, all lands not otherwise appearing to be clearly within private
ownership are presumed to belong to the State.

No public land can be acquired by private persons without any grant, express or implied, from the Government.
It is indispensable, therefore, that there is a showing of a title from the State. Occupation of public land in the
concept of owner, no matter how long, cannot ripen into ownership and be registered as a title.

NAVY OFFICERS' VILLAGE ASSOCIATION v. REPUBLIC, GR No. 177168, 2015-08-03

Facts:

TCT No. T-15387, issued in NOVAI's name, covers a 475,009 square-meter parcel of land (the property) situated
inside the former Fort Andres Bonifacio Military Reservation (FBMR) in Taguig, Metro Manila.

Barely a month after, or on October 25, 1965, Pres. Macapagal issued Proclamation No. 478[11] "reserving for the
veterans rehabilitation, medicare and training center site purposes" an area of 537,520 square meters of the land
previously declared as

AFP Officers' Village under Proclamation No. 461, and placed the reserved area under the administration of the
Veterans Federation of the Philippines (VFP).

On November 15, 1991, the property was the subject of a Deed of Sale between the Republic of the Philippines,
through former Land Management Bureau (LMB) Director Abelardo G. Palad, Jr., (Dir. Palad) and petitioner
NOVAI.

The deed of sale was subsequently registered and from which TCT No. T-15387 was issued in NOVAI's name.

In its complaint filed with the RTC on December 23, 1993, the Republic sought to cancel NOVAFs title based on the
following grounds: (a) the land covered by NOVAFs title is part of a military reservation; (b) the deed of sale
conveying the property to NOVAI, which became the basis for the issuance of TCT No. 15387, is fictitious; (c) the
LMB has no records of any application made by NOVAI for the purchase of the property, and of the NOVAFs
alleged payment of P14,250,270.00 for the property; and (d) the presidential... proclamation, i.e., Proclamation
No. 2487, claimed to have been issued by then President Corazon C. Aquino in 1991 that authorized the transfer
and titling of the property to NOVAI, is fictitious.

In its answer (which was later amended) to the Republic's complaint, NOVAI counter-argued that the property
was no longer part of the public dominion, as the land had long been segregated from the military reservation
pursuant to Proclamation No. 461.
In its decision, the RTC ruled that: (a) the property is alienable and disposable in character, as the land falls within
the area segregated from the FBMR pursuant to Proclamation No. 461

The CA reversed and set aside the RTC's decision. It ruled that the property is inalienable land of the public
domain; thus, it cannot be disposed of or be the subject of a sale. It pointed out that, since NOVAI failed to
discharge its burden of proving the existence of Proclamation No. 2487 - the positive governmental act that would
have removed the property from the public domain — the property remained reserved for veterans rehabilitation
purposes under Proclamation No. 478, the latest executive issuance affecting the property.

Since the property is inalienable, the CA held that the incontestability and indefeasibility generally accorded to a
Torrens title cannot apply because the property, as in this case, is unregistrable land; that a title issued by reason
or on account of any sale, alienation, or... transfer of an inalienable property is void and a patent nullity; and that,
consequently, the Republic's action for the cancellation of NOVAI's title cannot be barred by prescription.

NOVAI alleges that the CA erred in declaring that: (a) the property is inalienable land of the public domain

Issues:

whether the property in question was part of the FBMR, and hence, inalienable.

Ruling:

Yes.

The property is non-disposable land of the public domain reserved for public or quasi-public use or purpose

We agree with the CA that the property remains a part of the public domain that could not have been validly
disposed of in NOVAI's favor. NOVAI failed to discharge its burden of proving that the property was withdrawn
from the intended public or quasi-public use or... purpose.

While the parties disagree on the character and nature of the property at the time of the questioned sale, they
agree, however, that the property formed part of the FBMR - a military reservation belonging to the public
domain. We note that the FBMR has been the subject of... several presidential proclamations and statues issued
subsequent to Proclamation No. 423, which either removed or reserved for specific public or quasi-public use or
purpose certain of its portions.

As the property remains a reserved public domain land, its sale and the title issued pursuant to the sale are void

As the property remains a reserved public domain land, it is outside the commerce of man. Property which are
intended for public or quasi- public use or for some public purpose are public dominion property of the State and
are outside the commerce of... man. NOVAI, therefore, could not have validly purchased the property in 1991.

We reiterate and emphasize that property which has been reserved for public or quasi-public use or purpose are
non-alienable and shall not be subject to sale or other disposition until again declared alienable by law or by
proclamation of the President.

Any sale or disposition of property of the public dominion is void for being contrary to law and public policy.

Since the sale of the property, in this case, is void, the title issued to NOVAI is similarly void ab initio. It is a well-
settled doctrine that registration under the Torrens System does not, by itself, vest title as it is not a mode of
acquiring ownership;[71] that registration under the Torrens System merely confirms the registrant's already
existing title.

Accordingly, the indefeasibility of a Torrens title does not apply in this case and does not attach to NOVAI's title.
The principle of indefeasibility does not apply when the sale of the property and the title based thereon are null
and void. Hence, the Republic's action to... declare the nullity of NOVAI's void title has not prescribed.
CITY OF LAPU-LAPU v. PHILIPPINE ECONOMIC ZONE AUTHORITY, GR No. 184203, 2014-11-26

FACTS:

These are consolidated petitions for review on certiorari the City of Lapu-Lapu and the Province of Bataan
separately filed against the Philippine Economic Zone Authority (PEZA).

In G.R. No. 184203, the City of Lapu-Lapu (the City) assails the Court of Appeals’ decision dated January 11, 2008
and resolution dated August 6, 2008, dismissing the City’s appeal for being the wrong mode of appeal. The City
appealed the Regional Trial Court decision finding the PEZA exempt from payment of real property taxes.

In G.R. No. 187583, the Province of Bataan (the Province) assails the Court of Appeals’ decision dated August 27,
2008 and resolution dated April 16, 2009, granting the PEZA’s petition for certiorari. The Court of Appeals ruled
that the Regional Trial Court gravely abused its discretion in finding the PEZA liable for real property taxes to the
Province of Bataan.

Issues:

Whether the PEZA is exempt from payment of real property taxes?

Ruling:

The PEZA is exempt from payment of real property taxes.

The PEZA is an instrumentality of the national government.

An instrumentality is “any agency of the National Government, not integrated within the department framework,
vested with special functions or jurisdiction by law, endowed with some if not all corporate powers, administering
special funds, and enjoying operational autonomy, usually through a charter.

As an instrumentality of the national government, the PEZA is vested with special functions or jurisdiction by law.
Congress created the PEZA to operate, administer, manage and develop special economic zones in the Philippines.
Special economic zones are areas with highly developed or which have the potential to be developed into agro-
industrial, industrial tourist/recreational, commercial, banking, investment and financial centers.

Being an instrumentality of the national government, the PEZA cannot be taxed by local government units.

Although a body corporate vested with some corporate powers, the PEZA is not a government-owned or
controlled corporation taxable for real property taxes.

The law created the PEZA’s charter. Under the Special Economic Zone Act of 1995, the PEZA was established
primarily to perform the governmental function of operating, administering, managing, and developing special
economic zones to attract investments and provide opportunities for preferential use of Filipino labor.

Under its charter, the PEZA was created a body corporate endowed with some corporate powers. However, it was
not organized as a stock or non-stock corporation. Nothing in the PEZA’s charter provides that the PEZA’s capital is
divided into shares. The PEZA also has no members who shall share in the PEZA’s profits.

The PEZA does not compete with other economic zone authorities in the country. The government may even
subsidize the PEZA’s operations. Under Section 47 of the Special Economic Zone Act of 1995, “any sum necessary
to augment [the PEZA’s] capital outlay shall be included in the General Appropriations Act to be treated as an
equity of the national government.”

In addition, the Local Government Code exempting instrumentalities of the national government from real
property taxes was already in force when the PEZA’s charter was enacted in 1995. It would have been redundant
to provide for the PEZA’s exemption in its charter considering that the PEZA is already exempt by virtue of Section
133(o) of the Local Government Code.

As for the EPZA, Commonwealth Act No. 470 or the Assessment Law was in force when the PEZA’s charter was
enacted. Unlike the Local Government Code, Commonwealth Act No. 470 does not contain a provision specifically
exempting instrumentalities of the national government from payment of real property taxes. It was necessary to
put an exempting provision in the EPZA’s charter.

Real properties under the PEZA’s title are owned by the Republic of the Philippines

Under Section 234(a) of the Local Government Code, real properties owned by the Republic of the Philippines are
exempt from real property taxes.

Even the PEZA’s lands and buildings whose beneficial use have been granted to other persons may not be taxed
with real property taxes. The PEZA may only lease its lands and buildings to PEZA-registered economic zone
enterprises and entities. These PEZA-registered enterprises and entities, which operate within economic zones,
are not subject to real property taxes. Under Section 24 of the Special Economic Zone Act of 1995, no taxes,
whether local or national, shall be imposed on all business establishments operating within the economic zones.

REPUBLIC v. LUIS MIGUEL O. ABOITIZ, GR No. 174626, 2013-10-23

Facts:

Aboitiz filed his Application for Registration of Land Title of a parcel of land... hearing thereon ensued.

Aboitiz attached the original Tracing Cloth Plan... and the documents evidencing possession and ownership of the
land.

Aboitiz presented his witness,... (Sarah), his secretary, who testified that he entrusted to her the subject property
and appointed her as its caretaker; that he purchased the subject property from (Irenea)... that had been in
actual... owner... as per record of (DENR)... the subject property had been... classified as alienable and disposable

According to (CENRO), Cebu City, the subject property was not covered by any subsisting public land application;...
had been... covered by tax... in his name.

(Luz), daughter of Irenea, the original owner of the subject property, testified that she was one of the
instrumental witnesses in the deed of sale of the subject property... that her mother was in open, continuous,
peaceful, and exclusive possession of the said property... the Republic,... manifested that it would not adduce any
evidence to oppose the application for registration of Aboitiz.

the RTC granted Aboitiz's application for registration of the subject property.

the Republic appealed the RTC ruling before the CA.

the CA reversed the ruling of the RTC

The CA ruled that it was only from the date of declaration of such lands as alienable... that the period for counting
the statutory requirement of possession since June 12, 1945 or earlier would commence.

Possession prior to the date of declaration of the lands... alienability was not included.

Aboitiz moved for reconsideration

the CA reversed itself

Hence, this petition.

Aboitiz contends that the Republic is raising questions of fact which is beyond the appellate jurisdiction of this
Court. Consequently, the findings of fact by the RTC and affirmed by the CA are final, binding and conclusive upon
the Court. Aboitiz claims that sufficient evidence was presented to establish the nature and character of his
possession of the subject property as required by P.D. No. 1529.

The respondent argues that Aboitiz failed to validly establish the alienability of the subject property because he
only adduced a CENRO... certification to that effect, without presenting a copy of the original classification
approved by the DENR Secretary and certified as a true copy by the legal custodian of the official records. Further,
a declaration that the property is alienable and disposable is not... sufficient to make it susceptible to acquisitive
prescription. An express government manifestation that the property is already patrimonial or no longer intended
for public use, for public service or for the development for the national wealth pursuant to Article 422[14] of the
New Civil Code must also be shown.

Issues:

Whether Aboitiz is entitled to the registration of land title.

Ruling:

Section 14(1) of P.D. No. 1529 in relation to Section 48(b) of Commonwealth Act No. 141, as amended by Section 4
of P.D. No. 1073, provides:

SECTION 14. Who may apply. The following persons may file in the proper Court of First Instance an application
for registration of title to land, whether personally or through their duly authorized representatives:

(1) Those who by themselves or through their predecessors-in-interest have been in open, continuous, exclusive
and notorious possession and occupation of alienable and disposable lands of the public domain under a bona fide
claim of ownership since June 12, 1945, or earlier.

applicants for registration of land title must establish and prove: (1) that the subject land forms part of the
disposable and alienable lands of the public domain; (2) that the applicant and his predecessors-in-interest have
been in open,... continuous, exclusive and notorious possession and occupation of the same; and (3) that it is
under a bona fide claim of ownership since June 12, 1945, or earlier.

The absence of any one requisite renders the application for registration substantially defective... it is incumbent
upon the applicant to present a CENRO or Provincial Environment and Natural Resources Office (PENRO)
Certification; and a copy of... the original classification approved by the DENR Secretary and certified as a true
copy by the legal custodian of the official records... the Court cannot find any evidence to show the subject land's
alienable and disposable character,... the Court declared that the CENRO is not the official repository or legal
custodian of the issuances of the DENR Secretary declaring the alienability and disposability of public... lands.
With regard to the third requisite, it must be shown that the possession and occupation of a parcel of land by the
applicant, by himself or through his predecessors-in-interest, started on June 12, 1945 or earlier. A mere showing
of possession and... Occupation for 30 years or more, by itself, is not sufficient.

Alolina vs. Flores G.R. No. 198774 I April 04, 2016

FACTS:

Alolino is the registered owner of two (2) contiguous parcels of land. Alolino initially constructed a bungalow-type
house on the property. In 1980, he added a second floor to the structure. He also extended his two-storey house
up to the edge of his property. There are terraces on both floors. There are also six (6) windows on the perimeter
wall: three (3) on the ground floor and another three (3) on the second floor.

In 1994, the respondent spouses Fortunato and Anastacia (Marie) Flores constructed their house/sari sari store on
the vacant municipal/barrio road immediately adjoining the rear perimeter wall of Alolino's house. The structure
is only about two (2) to three (3) inches away from the back of Alolino's house, covering five windows and the exit
door. The respondents' construction deprived Alolino of the light and ventilation he had previously enjoyed and
prevented his ingress and egress to the municipal road through the rear door of his house.

Respondents on their part argued that they had occupied their lot where they constructed their house in 1955,
long before the plaintiff purchased his lot in the 70s. They further alleged that plaintiff only has himself to blame
because he constructed his house up to the very boundary of his lot without observing the required setback.
Finally, they emphasized that the wall of their house facing Alolino's does not violate the latter's alleged easement
of light and view because it has no window.

ISSUE:

(1) Whether or not Alolino has acquired easement of light and view; and (2) whether or not Alolino has acquired
an easement of right of way.

Held:

Alolino does not have an easement of light and view or an easement of right of way over the respondents'
property or the barrio road it stands on. Articles 649-657 governs legal easements of right of way. None of these
provisions are applicable to Alolino's property with respect to the barrio road where the respondents' house
stands on.

On the other hand, an easement of light and view can be acquired through prescription counting from the time
when the owner of the dominant estate formally prohibits the adjoining lot owner from blocking the view of a
window located within the dominant estate. Notably, Alolino had not made (and could not have made) a formal
prohibition upon the respondents prior to their construction in 1994; Alolino could not have acquired an
easement of light and view through prescription.