Hidden Treasure (438 and 439) - What is hidden treasure?

It is any hidden and known deposit of money, jewelry, or other precious objects, the lawful ownership of which does not appear. - If you see your neighbor one mid night, digging a hole on land and hiding a jar full of jewelry, and later on, you dug and searched for it, it is not a hidden treasure because there is a lawful owner. In hidden treasure, lawful ownership must not appear. - Money, Jewelry, other objects other objects mean objects of similar nature, thus mineral deposits and oil are not included (they are owned by the state) - Rules on hidden treasure: o Hidden treasure belongs to the owner of the land or property in which it is found. o If another person, not the owner of the property, finds it and by chance, apply 50-50 rule; o However, if the finder is a trespasser, he is not entitled to any share. o If the finder was precisely employed by the owner of the land to look for treasure, the finder will not be entitled to any share under 438; his remuneration will depend with his contract or agreement with the land owner. - The law requires that the finding should be by chance: o traditional meaning finding was not intended, totally unexpected, finder not looking for a treasure o contemporary meaning it is logic to think that by chance means by a stroke of good fortune example: a man has given a usufruct over a land and one day an old man gave him an old map with a treasure hidden on the part of his property, thus the usufructury digs at the precise spot stated in the map and he finds hidden treasure, it must be considered by chance Accession - GR: 440 if you are the owner of property, by right of accession, owner entitled/owned everything produced, incorporated or attached to property either naturally or artificially - Various kinds of accession: o Accession discreta right to everything produced by the property. Natural fruits spontaneous products of the soil as well as young and other products of animals (i.e. animal manure, mushrooms) Industrial fruits those which are produced by lands through human labor and cultivation (i.e. mushrooms produced in a farm) Civil fruits rents, price of leases of lands and properties, lif annuities and other similar income o Accession continua right of owner to everything which is incorporated or attached to the property either naturally or artificially Immovable Accession industrial building planting sowing Accession natural alluvium, avulsion, change of river beds, formation of islands Movable Adjunction or conjunction Commixtion or Confusion Specification

To the owner belong all of the fruits. BUT dont forget rule under 443 he who receives the fruits has the obligation to reimburse the expenses made by another person in the production gathering and preservation. However, In 443, the law does not distinguish between good faith or bad faith In 443 also, the article would not apply if the fruits have not yet been gathered. If fruits are still ungathered, 443 will not apply. If person is in bad faith and fruits have not been gathered, and owner recovers property, 443 will not apply. He who is in bad faith loses everything he built planted or sown 445 tells us when this rules on accession with respect to immovable property will apply or not 445 says whatever is built planted sown on the LAND OF ANOTHER, shall belong to the owner of the land. If person build plant sow on his own land, rules on accession will not apply 446 presumption that all works of sowing planting made by the owner to his expense 447 a land owner and decides to build on his property using the material of another person o Owner in good faith if owner thought he has the rights to use materials Obligation of owner - pay the value of the materials Right of the owner of material remove materials without injuring the construction planting or works (no real case of attachment) o Owner in bad faith if owner has knowledge that he has no right but nevertheless use the materials Obligation of owner pay the value of the materials plus damages Right of owner of material : recover damages, removal of materials even if it will injure construction planting or works 448 there is the land owner and somebody builds plants or sows on his property o 448 distinguishes planter from sower. Sower sow something which will not produce fruits for a long period of time (i.e. Rice); planter plant something that will last for years and continue producing fruits year after year (i.e. mango tree) Good faith, bad faith o BPS in good faith if he is not aware of any defect or flaw in his title or mode of acquisition, he thought he has legal right o BPS in bad faith if he is aware that he has no legal right o Land owner in good faith if he is not aware o Land owner in bad faith if he knew that somebody was building on his property and he allowed it to continue o If LO and BPS both in good faith Right of LO can appropriate what has been BPS on his land, but pay proper indemnity to BPS. Indemnity amount or market value at the time when the indemnity is to be paid. Prior of payment of indemnity, builder has the right of retention right to retain the property and continue occupying the land. Purpose: to insure that builder will be paid proper indemnity. If during period of retention, building is lost due to casa fortuito effect: builder loses right of retention, LO not obligated to pay buildings or improvements which ceases to exist. During period of retention, LO cannot require or compel builder to pay rent- because of right of retention, paying rent will injure the security for the payment of the indemnity. If the property is producing fruits, builder still entitled,

because it is his right as a builder in good faith (opinion), right of retention necessarily implies tenancy and continued possession, no compensation between fruits and amount of indemnity can sell the land occupied by the building or planting to the builder or planter, but cannot however avail of that option if the value of the land is considerably more than the value of the building or planting. If the value of land and building or planting is the same or not too much, LO not precluded from availing of that option (lease agreement, courts may fix in case of non-agreement). Option is given to the LO, either to appropriate or ask the builder to buy the land. Builder cannot compel the LO to sell the land to him because the option is given by law to LO. Reason: Right of LO is older. LO cannot simply refuse the options given to him by law. The options are limited to those enumerated in 448. XPN: Suppose the LO avails or opted the option of Sale (value of land not considerably more than the value of the building), and the builder cannot pay, LO can ask for the removal of the building. Other options available to LO if builder cannot pay? Contract of Lease, Removal, Sale of both the land and the building, proceeds of which will be first applied to the value of land, excess will be delivered to the owner of the house or the building. Prior to the time LO exercises his option, the builder occupying the land can be compelled to pay rent, but the moment the LO chooses to exercise the option to appropriate, Right of Retention arises and rents cannot be collected anymore. If LO chooses the option of Sale of land to builder, rents can be demanded until such time when the land is acquired by the builder.

Rules on accession on a movable property where it will not apply when the LO himself builds on his own property, it follows therefore that if a co-owner of a property builds on the property under coownership, GR: these rules will not apply, co-owner owner of ideal adequate share of whole. Co-owners right to use. o XPN: if the co-ownership has already been terminated by partition, and it is discovered that one of co-owners built on a part of a property which was later on adjudicated to another co-owner, 448 will apply. Claim of good faith may be made by a successor in interest of the original builder. Claim of good faith can also be invoked when mistake in boundaries are made even if the property involved is registered under a Torrens title. The precise description of the property does not matter ordinary persons are not expected to know the precise boundaries of the property. Vagrant assertions = no visible means of support = bad faith If builder is in bad faith, he loses everything and becomes liable for damages. o LO can demand that builder buys the land without consideration. o LO has the right to demand removal of property. XPN: Recovery of necessary expenses for the preservation of the property (because the LO himself may incur same amount of expenses if it were his property fairness and justice). (ins) Everything produced and fruits belong to the owner. Bonuses are not fruits because they were not produced by the land, they are not even civil fruits

Both LO and Builder in Bad faith = considered to have acted in good faith (448 applicable) o If builder uses material of third person in building on land of another B LO MO good faith MO has right to recover value of materials to B, but LO can be held subsidiarily liable If B is in bad faith and LO demands removal of building, LO would have no subsidiary liability. He who benefits for the accession must pay for it. If LO decides to appropriate, there is subsidiary liability in case B is insolvent. If LO sells property pending payment of indemnity to builder, If in the contract of sale between LO and third person if LO is already paid the value of the building, LO must pay B, if LO not paid the value of the building, third person has to pay B.

Alluvion (457) - Owner of parcel of land adjoining the bank of river and due to natural action of water, deposits of river silt are left there by the water and area of your land gradually increased, you are the owner of that increased area. Ownership is automatic. The additional area brought about by alluvion automatically belongs to the land owner. It is not however automatically registered or protected by the Torrens title, registration is a must. Prior registration, if a third person succeeds and claims that area through acquisitive prescription, third person is considered the owner. Increase in area absolutely no human intervention. In areas bordering lakes, if there are additional areas, they will belong to the owners of the adjacent lands. If you own a parcel of land and through the action of the sea, the land increased in area, the accretion belongs to the state. Alluvion applicable only to rivers, shores of the seas not included. XPN. Lakes (under Spanish Law on Waters)