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I. PROPERTY, OWNERSHIP, AND ITS MODIFICATIONS

1. Classification of Property
​
All things which are or may be the object of appropriation are considered as either:
1. immovable or real property; or
2. movable or personal property. (Art. 414, NCC)

Property does not only cover material things because it mentions rights which could
either be classified as real or personal rights. (Art. 415(10), NCC; Paras, 2008)

Thing vs. Property

Thing: It refers to all objects that exist, including those which could not be appropriated
by man. It is broader in scope than property. It involves only corporeal objects.

Property: It refers to objects already possessed by man or are in their possession. All
kinds of property are things but not all things are property. It may refer to intangible
matters.

Requisites for a Thing to be Considered as Property:

1. Utility – It can serve as a means to satisfy human needs;

2. Substantivity or Individuality – It has a separate and autonomous existence and is not

simply a part of a whole; and

3. Appropriability – Susceptibility to ownership or possession, even if not yet

appropriated. (De Leon, 2006)

Properties NOT susceptible of appropriation:

1. Common things (res communes) (e.g., electricity, oxygen, distilled water);

XPN: Those that may be appropriated under certain conditions in a limited way.

2. Not yet been appropriated (res nullius) (e.g., wild animals, hidden treasures) or because
it has been lost or Abandoned by the owner;

3. Not susceptible due to Physical impossibility (e.g., sun, moon, and other heavenly
bodies); and

4. Not susceptible due to Legal impossibility (e.g., human body while the person is alive).
(De Leon, 2006)

2. Kinds of Property

i. Immovable Property (Art. 415)

1. Land, buildings, roads, and constructions of all kinds adhered to the soil;

2. Trees, plants, and growing fruits, while they are attached to the land or form an integral
part of an immovable;

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3. Everything 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;

4. Statues, reliefs, paintings, or other objects for use or ornamentation, placed in buildings
or on lands by the owner of the immovable in such a manner that it reveals the intention
to attach them permanently to the tenements;

5. 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;

6. Animal houses, pigeon-houses, beehives, fish ponds, or breeding places of similar

nature, in case their owner has placed them or preserves them with the intention to have
them permanently attached to the land, and forming a permanent part of it; the animals
in these places are included;

7. Fertilizer actually used on a piece of land;

8. Mines, quarries, and slag dumps, while the matter thereof forms part of the bed, and
waters either running or ;
stagnant
9. Docks and structures which, though floating, are intended by their nature and object to
remain at a fixed place on a river, lake, or coast; and

10. Contracts for public works, servitudes, and other real rights over immovable property.

Real properties are categorized by:

1. Nature – Those which by their essence and nature are immovable or cannot be moved
from one place to another;

2. Incorporation – Those which are attached to an immovable in a fixed manner and

considered as an integral part thereof, irrespective of its ownership;

3. Destination – Things placed in buildings or on lands by the owner of the immovable or

his agent in such a manner that it reveals the intention to attach them permanently
thereto; and

4. Analogy – Classified by express provision of law or those which are not tangible
properties but are rights and interests over existing immovable properties. (Paras, 2008)

Land, buildings, roads, and constructions of all kinds adhered to the soil. (Art. 415(1), NCC)

Immovable by nature and incorporation

Land : By its very nature, it is an immovable property. In whatever transaction land is

involved, it is always immovable.

Building : A building is always immovable whether built on one’s land or rented.

XPN: When a building is merely superimposed on the soil or is sold for immediate
demolition, in which case it may be considered as movable or personal property.

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Trees, plants, and growing fruits, while they are attached to the land or form an integral
part of an immovable. (Art. 415(2), NCC)

Trees and Plants: ​

1. A real property; or
a. By nature - If they are spontaneous products of the soil; or
b. By incorporation - If they have been planted through cultivation or labor.

2. A personal property - The moment trees are detached or uprooted from the land it is
considered as personal property.

Fruits: Growing fruits are considered real property so long as they are still attached to the
soil. Once removed from the soil, they become personal properties.

XPN: Growing fruits may be exceptionally treated as personal property under the
provisions of Art. 416(2) of the NCC.

Everything 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. (Art.
415(3), NCC)

An incorporated thing is considered as real property when in cases of separation, the

injury, breakage, or deterioration is substantial. (Paras, 2008)

Res vinta : These are immovables by incorporation, which when separated from the
immovable, regain their condition as movable. (Pineda, 2009)

Statues, reliefs, paintings, or other objects for use or ornamentation placed in buildings or
on lands by the owner of the immovable in such a manner that it reveals the intention to
attach them permanently to the tenements. (Art. 415(4), NCC)

“Placed by the owner” : This means that the objects must be placed by the owner of the
immovable and not necessarily the owner of the object.

Requisites:

1. Placed in buildings or on lands by the owner of the immovable or by his agent; and

2. Placed there in a manner that reveals the intention to attach them permanently to the
tenements.

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. (Art. 415(5),
NCC)

Requisites for Machinery to be considered Real Property:

1. The industry or work must be Carried on in a building or on a piece of land;

2. The machinery must:

a. Be placed by the Owner of the tenement or his agent; and
b. Tend directly to meet the needs of the said industry or work; and

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3. Be Essential and principal to the industry or work, and not merely incidental thereto.

Animal houses, pigeon-houses, beehives, fishponds, or breeding places of similar nature,

in case their owner has placed them or preserves them with the intention to have them
permanently attached to the land and forming a permanent part of it; the animals in
these places are included. (Art. 415(6), NCC)

Animal houses, pigeon houses, etc.: These are immovable by destination or by

incorporation. The Code requires that they be placed by the owner of the land to acquire
the nature of real property. However, they are still considered real property even if not
placed by the owner if such structures are adhered to the soil permanently.

Beehives, fishponds, or breeding places of similar nature are real property; animals
contained therein included : When purposely constructed or attached to the ground or
on another immovable (like a tree-wall), fishponds and other similar breeding places, like
cemented containers where the breeding of fishes or crustaceans is done, are
considered immovable property if the owner of the land or tenement intended them to
be permanent.

The animals in the animal houses, the pigeons in the pigeon houses, the bees in the
beehives, and the fish in the fishponds are included and considered part of the
immovable property.

Fertilizer actually used on a piece of land. (Art. 415(7), NCC)

Fertilizers which are still in the sacks, although there is the intention to place them or use
them on land, are movable. Only fertilizers actually used on a piece of land are deemed
immovable since it is already placed in the land and can never be separated from it
without scraping the soil or destroying it.

Mines, quarries, and slag dumps, while the matter thereof forms part of the bed, and
waters either running or stagnant. (Art. 415(8), NCC)

By their nature, mines, quarries, and slag dumps are immovable property.
1. Mines – These are mineral lands where excavations are done to extract minerals such
as gold, ores, etc.

2. Quarries – These are lands where stones are chipped off or where sand is being
extracted.

3. Slag dumps – They consist of waste and dirt taken from a mine and mounted on the
surface of the ground under excavation

4. Running or Stagnant Waters – These waters refer to waters still running through the
soil or ground in mines and quarries.

Docks and structures which, though floating, are intended by their nature and object to
remain at a fixed place on a river, lake, or coast. (Art. 415(9), NCC)

Power barges are categorized as immovable property by destination, being in the nature
of machinery and other implements intended by the owner for an industry or work which
may be carried on in a building or on a piece of land and which tend directly to meet the
needs of said industry or work.

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(Fels Energy, Inc. v. Province of Batangas, G.R. No.

168557, 19 Feb. 2007)

The platform is an immovable property by destination. It was intended by the owner to

remain at a fixed place on a river or coast. Art. 415(9) of the NCC considers as real
property “docks and structures which, though floating, are intended by their nature and
object to remain at a fixed place on a river, lake, or coasts.” (Ibid.)

Vessels are considered personal property under civil law and common law and are
occasionally referred to as a peculiar kind of personal property. It is essential that a
record of documents affecting the title to a vessel be entered in the record of the
Collector of Customs at the port of entry. (Art. 585, Code of Commerce)

Contracts for public works and servitudes and other real rights over immovable property.
(Art. 415(10), NCC)

These properties refer to contracts for public works, servitudes, and real rights over
immovable property (like usufruct). They are inseparable from their immovable sources.
Hence, for convenience, they are considered immovable not by their nature, destination,
or incorporation but by analogy. While not tangible, they have the characteristics of real
property (e.g., Contract over the construction of a bridge). (Pineda, 2009)

ii. Movable Property (Arts. 416-417)

1. Those movables susceptible of appropriation which are not included in the Art 415;

2. Real property which by any special provision of law is considered as personalty;

3. Forces of nature which are brought under control by science; and

4. In general, all things which can be transported from place to place without impairment
of the real property to which they are fixed.

5. Obligations and actions which have for their object movables or demandable sums;
and

6. Shares of stock of agricultural, commercial and industrial entities, although they may
have real estate.

Tests to determine whether a property is a movable property:

1. Test of Exclusion – Everything not included in Art. 415 of NCC (e.g., ships or vessels or
interest in a business);

2. By reason of a Special law – Immovable by nature but movable for the purpose of the
special law (e.g., Growing crops for purposes of the Chattel Mortgage Law); and

3. Test of Mobility – If the property is capable of being carried from place to place
without injuring the real property to which it may in the meantime be attached. (De Leon,
2006)

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Classification of property by nature

Movable property is either consumable or non- consumable. To the first class belong
those movables which cannot be used in a manner appropriate to their nature without
their being consumed; to the second class belong all others. (Art. 418, NCC)

Properties classified according to consumability

1. Consumable property – That which cannot be used according to its nature without
being consumed or being eaten or used up (e.g., cigarette, glass of wine); and

2. Non-consumable property – That which can be used according to its nature without
being consumed or being eaten or used up (e.g., eyeglasses, book).

Properties classified according to Susceptibility to Substitution

1. Fungible property – If it can be substituted by another thing of the same kind, quantity,
and quality; and

2. Non-fungible property – if not replaceable in such equivalents.

3. Property in Relation to Whom it Belongs

Property is either of public dominion or private ownership

1. In relation to the State

a. Public Dominion; and
b. Patrimonial. (Arts. 420 and 421, NCC)

2. In relation to political subdivisions/local government unit

a. Public use; and
b. Patrimonial. (Arts. 423-424, NCC)

3. In relation to private persons

a. Owned individually; and
b. Owned collectively. (Art. 425, NCC)

i. Property of Public Dominion

It means ownership by the public in general, in that not even the State or subdivisions
thereof may make them the object of commerce as long as they remain properties for
public use. (Paras, 2008)

Properties classified as public dominion cannot be alienated but are not totally outside the
commerce of man as the Constitution allows the State to enter into co-production, joint
ventures, or production-sharing agreements with private individuals or corporations for
their exploration, development, and utilization. (Rabuya, 2008)

To be classified as property of public dominion, an intention to devote it to public use or

public service is sufficient and it is not necessary that it must be used as such.

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Property of Public Dominion under the NCC

1. Those intended for public use, such as roads, canals, rivers, torrents, ports, and bridges
constructed by the State, banks, shores, roadsteads, and others of similar character; and

2. Those which belong to the State, without being for public use, and are intended for
some public service or the development of the national wealth. (Art. 420, NCC)

All other property of the State, which is not of the character stated above, is patrimonial
property. (Art. 421, NCC)

Patrimonial Property

This is a property of the State, which is not intended for public use, public service, or the
development of national wealth. It is intended rather for the attainment of the economic
ends of the State, that is, for its subsistence.

It is owned by the State in its private or proprietary capacity.

An executive or legislative act is necessary to reclassify property into patrimonial. The

conversion cannot be inferred from non-use.

It may be disposed of by the State in the same manner that private individuals dispose of
their own property subject, however, to administrative laws and regulations.

Kinds of property of Public Dominion

1. For Public Use – may be used by anybody;

2. Intended for Public Service and not for public use – may be used only by duly
authorized persons; and

3. For the Development of the national wealth – like our natural resources. (Art. 420, NCC)

Characteristics of Properties of Public Dominion

1. In general,they can be Used by everybody;

2. Cannot be Levied upon by execution or attachment;

3. May Either be real or personal property;

4. Cannot be acquired by Prescription;

5. Cannot be Registered under Land Registration Law and be the subject of Torrens Title;

6. Outside the commerce of man – cannot be alienated or leased or be subject of any

contract; and

7. Cannot be Burdened by voluntary easement.

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Conversion from property of public dominion to patrimonial property, how effected

Property of public dominion, when no longer intended for public use or public service,
shall form part of the patrimonial property of the State. (Art. 422, NCC)

When no longer intended or operated for public use or public service, property of public
dominion shall form part of the State’s patrimonial property as of the date the
Government, through the Executive or Legislative Departments, has formally declared
that it is no longer needed for said purposes. (Ignacio v. Director of Land, G.R. No. L-
12958, 30 May 1960)

ii. Property of Private Ownership

Property of private ownership, besides the patrimonial property of the State, provinces,
cities, and municipalities, consists of all property belonging to private persons, either
individually or collectively. (Art. 425, NCC)

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