Mercader, Jr. vs. Bardilas

The owner of the servient estate retains ownership of the portion on which the easement is established, and a mere descriptive reference to an easement in a certificate of title does not constitute acquisition by title under Article 622 of the Civil Code.

The case stems from a boundary dispute involving subdivided lots formerly part of Lot 5808-F in Barangay Punta Princesa, Cebu City. The Clarita Village Association erected a concrete fence in 1992 that closed an exit point of a right of way, leading to conflicts between the Mercaders and Bardilas regarding the use, ownership, and encroachment upon the easement area.

• Filed in RTC Cebu City as two separate cases: Civil Case No. CEB-12783 (declaratory relief, injunction, and damages by Mercaders) and Civil Case No. CEB-13384 (specific performance by Bardilas).
• Consolidated in RTC Branch 20.
• RTC Decision (October 10, 1995): Declared extinguishment of the easement; declared Mercaders as owners of the extinguished easement; dismissed Bardilas' complaint in CEB-13384; awarded damages to Mercaders.
• Motion for new trial denied by RTC (November 13, 1995).
• Appealed to CA.
• CA Decision (March 18, 2003): Modified RTC decision; declared Bardilas as owners of the 3-meter road; granted them right to use it; awarded P20,000 attorney's fees; dismissed CEB-13384.
• Motion for reconsideration denied by CA (March 16, 2004).
• Elevated to SC via petition for review on certiorari.

• Nature of Action: Two consolidated civil cases involving declaratory relief and specific performance regarding a road right of way.
• Parties:
  • Petitioners (Mercaders): Spouses Bernabe Mercader, Jr. and Lorna Jurado Mercader (owners of Lot 5808-F-2-A, 89 sqm), and Oliver, Geraldine, and Esramay Mercader (owners of Lot 5808-F-1).
  • Respondents (Bardilas): Spouses Jesus and Letecia Gabuya Bardilas (owners of Lot 5808-F-2-B, 249 sqm, and Lot 5808-F-3).
  • Property Configuration: Lot 5808-F-2-A (Mercader) and Lot 5808-F-2-B (Bardilas) were formerly part of Lot 5808-F-2. Lot 5808-F-2-A is situated in front of (west of) Lot 5808-F-2-B.
• Technical Descriptions:
  • TCT No. 107914 (Mercader) describes Lot 5808-F-2-A as bounded by Lot 5808-F-2-B "with existing Right of Way (3.00 meters wide)."
  • TCT No. 107915 (Bardilas) describes Lot 5808-F-2-B with an annotation "subject to 3 meters wide right of way" and specifies boundaries showing the right of way is part of their lot.
  • Encroachment: The Mercaders' residential house and fence encroached approximately 14 square meters on the 3-meter wide right of way.
  • Closure: In May 1992, the Clarita Village Association erected a concrete perimeter fence closing the exit point of the right of way to the subdivision street, rendering the easement temporarily unused and forcing the Bardilas to use a circuitous alternative route.
  • Demand: The Bardilas demanded P30,000 from the Mercaders for the encroachment or demolition of the encroaching portions, which the Mercaders refused.

• The Mercaders claimed they acquired rights to the road right of way "by title" under Article 622 of the Civil Code because their TCT contained the phrase "with existing Right of Way (3.00 meters wide)."
• They argued that since Lot 5808-F-2-A and Lot 5808-F-2-B were formerly one lot (Lot 5808-F-2) with a common right of way, they were entitled to share equally in the easement area as dominant estate owners.
• They contended the easement was extinguished by non-user (Article 631) due to the closure by the Clarita Village Association, and by merger of the dominant and servient estates in their favor.
• They argued the award of attorney's fees to the Bardilas was improper because the CA made no finding that the Bardilas were compelled to litigate with third persons or incur expenses to protect their interest.

• The Bardilas argued they owned the right of way as part of Lot 5808-F-2-B (the servient estate), evidenced by the technical description in their TCT and the subdivision plan.
• They maintained that the Mercaders were not entitled to the easement because their property (Lot 5808-F-2-A) fronted a side street in Clarita Village and did not need the right of way.
• They asserted that the Mercaders' encroachment prevented them from installing a 3-meter wide iron gate as agreed upon with the Clarita Village Association.
• They claimed the easement was not extinguished and they retained ownership of the servient portion under Article 630 of the Civil Code.

• Procedural Issues: N/A
• Substantive Issues:
  • Whether the Mercaders acquired ownership of the road right of way by virtue of the phrase "with existing Right of Way" in their TCT.
  • Whether the easement of right of way was extinguished by non-user or merger.
  • Whether the award of attorney's fees to the Bardilas was proper under Article 2208 of the Civil Code.

• Procedural: N/A
• Substantive:
  • Ownership of Easement: The SC held that the Mercaders did not acquire ownership of the easement. The phrase "with existing Right of Way" in the TCT was merely a boundary description referring to Lot 5808-F-2-B, not a mode of acquisition by title under Article 622. Acquisition by title requires a juridical act (law, donation, contract, will), not a descriptive annotation.
  • Extinguishment: The SC found no extinguishment. Under Article 630, the Bardilas, as owners of the servient estate, retained ownership of the portion on which the easement was established. The closure by the Clarita Village Association did not transfer ownership to the Mercaders.
  • Attorney's Fees: The SC deleted the award of P20,000 attorney's fees. The CA failed to provide factual, legal, or equitable justification for the award under Article 2208(11). Attorney's fees cannot be awarded as a matter of course merely because a party prevails; the basis must be clearly expressed in the decision to avoid placing a premium on the right to litigate.

• Easement as a Real Right — Defined as a real right constituted on another's property by virtue of which the owner has to abstain from doing or allow another to do something on his property for the benefit of another thing or person. It exists only when servient and dominant estates belong to different owners and grants no title to the dominant estate owner.
• Article 630, Civil Code (Retention of Ownership by Servient Estate) — The owner of the servient estate retains ownership of the portion on which the easement is established, and may use the same in such manner as not to affect the exercise of the easement. The SC applied this to confirm the Bardilas retained ownership of the 3-meter right of way.
• Article 622, Civil Code (Acquisition by Title) — Discontinuous easements (such as road right of way) may be acquired only by virtue of title (law, donation, contract, will of testator). A mere descriptive reference in a TCT does not constitute acquisition by title.
• Article 2208, Civil Code (Attorney's Fees) — Attorney's fees are the exception rather than the rule. The power of the court to award attorney's fees demands factual, legal, and equitable justification, and the basis for the grant must be clearly expressed in the judgment.
• Torrens System Principle — A certificate of title is merely evidence of ownership; what defines land is its boundaries as laid down in the technical description, not the area mentioned.

• "The owner of the servient estate retains ownership of the portion on which the easement is established, and may use the same in such manner as not to affect the exercise of the easement." (Article 630, Civil Code)
• "Easement or servitude... is a real right constituted on another's property... It exists only when the servient and dominant estates belong to two different owners. It gives the holder of the easement an incorporeal interest on the land but grants no title thereto."
• "Attorney's fees are not awarded as a matter of course every time a party wins. We do not put a premium on the right to litigate."
• "What is just and equitable in a given case is not a mere matter of feeling but of demonstration... the exercise of judicial discretion in the award of attorney's fees under Article 2208(11) of the Civil Code demands a factual, legal or equitable justification upon the basis of which the court exercises its discretion."

• Valdez v. Tabisula, G.R. No. 175510 — Cited for the definition of easement or servitude.
• Bogo-Medellin Milling Co., Inc. v. Court of Appeals, G.R. No. 124699 — Cited for the principle that an easement grants no title to the dominant estate.
• Costabella Corporation v. Court of Appeals, G.R. No. 80511 — Cited to classify road right of way as a discontinuous apparent easement under Article 622.
• Bernardo v. Court of Appeals, G.R. No. 106153 — Cited by petitioners regarding attorney's fees, but distinguished by the SC.
• Philippine National Construction Corporation v. APAC Marketing Corporation, G.R. No. 190957 — Cited for the requirement that the basis for granting attorney's fees must be clearly expressed in the judgment.
• Eastern Shipping Lines, Inc. v. Margarine-Verkaufs-Union, No. L-31087 — Cited for the principle that the exercise of discretion to award attorney's fees under Article 2208(11) demands factual, legal, or equitable justification.

• Article 630, Civil Code — Provides that the owner of the servient estate retains ownership of the portion on which the easement is established.
• Article 622, Civil Code — Governs acquisition of discontinuous easements by title (law, donation, contract, will).
• Article 428, Civil Code — Recognizes the owner's right to enjoy and dispose of a thing without limitations other than those established by law (attributes of ownership: jus utendi, jus fruendi, etc.).
• Article 2208, Civil Code — Enumerates the instances when attorney's fees and expenses of litigation may be recovered.

• N/A (Sereno, C.J., Leonardo-De Castro, Perlas-Bernabe, and Caguioa, JJ., concurred without separate opinions).