Angeles vs. Pascual

Article 448 of the Civil Code applies to a builder in good faith who encroaches on another's land, granting the landowner the right to choose between appropriating the improvement after indemnity or obliging the builder to pay the price of the land, and there is no inconsistency between a finding of good faith and the imposition of these reciprocal options.

Regidor Pascual and Pedro Angeles were registered owners of adjacent parcels of land in Cabanatuan City, covered by Transfer Certificate of Title No. T-43707 (Lot 4) and TCT No. T-9459 (Lot 5), respectively. After a third party's relocation survey revealed that Pascual's house encroached on an adjacent lot, resulting in his ejection therefrom, Pascual caused a relocation survey of his own Lot 4. The survey disclosed that Angeles' house occupied 252 square meters of Pascual's 318-square-meter lot. Pascual demanded rentals or the removal of the house, which Angeles refused, prompting Pascual to file a complaint for recovery of possession and damages.

• Adjacent Owners: Regidor Pascual owned Lot 4, Block 2, while Pedro Angeles owned Lot 5, Block 2, both located in Cabanatuan City and covered by respective Transfer Certificate of Titles.
• Discovery of Encroachment: Metropolitan Bank and Trust Company caused a relocation survey of the adjacent Lot 3, revealing that Pascual's house encroached on Lot 3, leading to Pascual's ejection. Pascual subsequently caused a relocation survey of his own Lot 4, which revealed that Angeles' house occupied 252 square meters of Pascual's 318-square-meter lot.
• Conflicting Surveys: During trial, Pascual presented geodetic engineer Clarito Fajardo, who conducted an actual relocation survey and testified that Angeles' house was erected on Lot 4. Angeles presented geodetic engineer Juan Fernandez, who prepared a sketch plan claiming no encroachment; however, Fernandez admitted he only performed a "table work" based on TCT descriptions without visiting the site and recommended an actual relocation survey.
• Lower Court Findings: Both the RTC and the CA gave credence to Fajardo's actual relocation survey over Fernandez's table work, establishing the fact of encroachment by preponderant evidence. Both courts also found and declared Angeles to be a builder in good faith, as he insisted he built his house believing it was entirely on his own lot.

• Credence in Survey: Petitioner argued that the CA erred in according credence to the testimony and relocation plan of Fajardo as opposed to the survey plan prepared by Fernandez.
• Inconsistency of Art. 448: Petitioner maintained that the options laid down by the CA under Article 448 of the Civil Code—requiring Pascual either to buy the portion of the house or sell the portion of the land—were inconsistent with the finding that he was a builder in good faith.

• Encroachment Proven: Respondents asserted that petitioner's house encroached on their lot, as proven by the actual relocation survey conducted by Fajardo.
• Proper Application of Art. 448: Respondents implicitly supported the CA's application of Article 448, which governed the rights and obligations of the parties given the finding of good faith, granting the landowner the right of choice.

• Factual Review: Whether the Supreme Court can review the CA's factual finding giving credence to Fajardo's relocation survey over Fernandez's sketch plan.
• Application of Article 448: Whether the CA correctly applied Article 448 of the Civil Code and whether the options granted to the landowner are inconsistent with the finding that the builder acted in good faith.

• Factual Review: The factual finding was binding, the Supreme Court not being a trier of facts. Under Section 1, Rule 45 of the Rules of Court, only questions of law may be raised in a petition for review on certiorari. None of the recognized exceptions to this rule—such as when findings are based on speculation, when the inference is manifestly mistaken, or when the CA's findings contradict those of the trial court—were present. The concurrent findings of the RTC and the CA on the credibility of the actual relocation survey over a mere "table work" sketch plan were conclusive.
• Application of Article 448: The application of Article 448 was correct and proper. Good faith consists of the builder's belief that the land being built upon is his own and his ignorance of a defect or flaw in his title. There is no inconsistency between a finding of good faith and the imposition of Article 448's reciprocal options; precisely because the builder acted in good faith, the law grants the landowner the right of choice between appropriating the building after indemnity or obliging the builder to pay the price of the land. The argument based on the indefeasibility of Torrens titles was inapplicable, as the issue concerned the actual location of the lots, not the validity of the titles or their metes and bounds.

• Rule 45 Petitions Limited to Questions of Law — Under Section 1, Rule 45 of the Rules of Court, only questions of law may be raised in a petition for review on certiorari because the Supreme Court is not a trier of facts. Factual findings of lower courts are binding, subject to recognized exceptions (e.g., findings based entirely on speculation, when the inference made is manifestly mistaken, when there is grave abuse of discretion, when the judgment is based on a misapprehension of facts, when findings of facts are conflicting, etc.).
• Builder in Good Faith (Article 448) — When a person builds in good faith on land owned by another, Article 448 of the Civil Code applies. Good faith consists of the belief that the land being built on is one's own and ignorance of a defect in one's title. The landowner has the right to choose between appropriating the improvement after indemnity or obliging the builder to pay the price of the land. The builder cannot be obliged to buy the land if its value is considerably more than that of the building; in such case, the builder pays reasonable rent if the landowner does not choose to appropriate the building.

• "A question, to be one of law, must not involve an examination of the probative value of the evidence presented by the litigants or any of them. There is a question of law in a given case when the doubt or difference arises as to what the law is on certain state of facts; there is a question of fact when the doubt or difference arises as to the truth or falsehood of alleged facts."
• "Good faith consists in the belief of the builder that the land he is building on is his and in his ignorance of a defect or flaw in his title."

• FNCB Finance v. Estavillo, G.R. No. 93394 — Cited as controlling precedent for the rule that the Supreme Court is not a trier of facts and factual findings of lower courts are binding.
• Sampayan v. Court of Appeals, G.R. No. 156360 — Cited for the enumeration of exceptions to the rule that the Supreme Court does not review factual findings in Rule 45 petitions.
• Pleasantville Development Corporation v. Court of Appeals, G.R. No. 79688 — Cited as controlling precedent for the definition of good faith of a builder on another's land.

• Section 1, Rule 45, Rules of Court — Provides that petitions for review on certiorari shall raise only questions of law. Applied to bar the review of the CA's factual findings on encroachment.
• Article 448, Civil Code — Governs the rights and obligations of the owner of the land and a builder in good faith. Applied to grant the landowner the right of choice between appropriating the improvement or obliging the builder to pay the price of the land.
• Presidential Decree No. 1529 (Property Registration Decree) — Governs the indefeasibility and incontrovertibility of Torrens titles. Held inapplicable because the ownership and the metes and bounds in the TCTs were not in dispute; the only issue was the actual location of the lots on the ground.

Renato C. Corona, Teresita J. Leonardo-De Castro, Mariano C. Del Castillo, Jose Portugal Perez