G.R. No. 104828 – 334 Phil. 216 – 266 SCRA 242 – Civil Law – Law on Property – Accession Natural – Owner in Good Faith; Builder in Bad Faith – Right of Pre-emption
In July 1989, the spouses Renato and Elizabeth Macapagal purchased a parcel of land adjoining the lot of spouses Rafael and Avelina Benitez. After they conducted a survey on said land, the spouses Macapagal discovered that the house of spouses Benitez was already encroaching their property. Macapagal then demanded in writing for Benitez to vacate. Eventually, an ejectment suit was filed by Macapagal against Benitez.
The trial court ruled in favor of Macapagal as it found Benitez to be a builder in bad faith. On appeal, Benitez insists that they are builders in good faith hence he should be given the option to exercise the right of pre-emption (the right to buy the said portion of land owned by Macapagal which is being occupied by his [Benitez] house.)
ISSUE: Whether or not the right of pre-emption may be exercised by a builder in good faith.
HELD: No. In the first place, there is already a factual finding by the trial court that Benitez was a builder in bad faith.
Secondly, even assuming that Benitez was a builder in good faith, he cannot exercise said right of pre-emption. The right of pre-emption or the right to sell is solely lodged in the owner in good faith as provided for by Article 448 of the Civil Code. This advantage in Article 448 is accorded the landowner in good faith because “his right is older, and because, by the principle of accession, he is entitled to the ownership of the accessory thing.” Otherwise stated, the builder in good faith has no pre-emptive right to buy even as a compromise, as this prerogative belongs solely to the landowner in good faith.
How about if the builder is in bad faith, like in this case?
The right is not shifted in favor of the builder in bad faith. And this situation is now governed by Article 450 of the Civil Code which gives the owner in good faith the options either:
a. to demand the builder in bad faith to demolish what he built; or
b. to compel the builder in bad faith to pay the price of the land.
