Understanding Manila Seedling’s usufructuary rights | Inquirer Business
Property rules

Understanding Manila Seedling’s usufructuary rights

“We don’t inherit the earth from our ancestors; we borrow it from our children,” said Native American leader Chief Seattle.

In line with this proverb, former President Ferdinand E. Marcos issued Proclamation No. 1670, series of 1977, granting to the Manila Seedling Bank Foundation, Inc. (MSBFI) usufructuary rights over a 7-ha parcel of land owned by the National Housing Authority (NHA).

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Thus, for the next three decades, MSBFI cultivated the said land for garden and flower centers and pet shops, and provision of tree pruning and farming and greenhouse construction services, in support of the government’s greening program.

In 2012, however, Quezon City Mayor Herbert Bautista sent policemen, members of his Department of Public Order and Safety, and private persons, to forcibly take over the land occupied by MSBFI. Thereafter, the Quezon City government successfully ejected the MSBF and its tenants from said land.

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In his letter to former President Benigno Aquino III dated 8 December 2014, Bautista prayed that Proclamation No. 1670 be amended so that the rights to the 7-ha land be granted to the Quezon City government instead.

According to Bautista, the Quezon City government validly forfeited the land purportedly because of MSBFI’s failure to pay real estate taxes since 1981.

Surely, the Quezon City government’s actions violate the usufruct constituted in favor of MSBFI over the land. No less than the Supreme Court recognized the usufruct constituted in favor of MSBFI for a period of 50 years, or until 2027, in accordance with Article 605 of the Civil Code, in National Housing Authority v. Court of Appeals.

Usufruct gives MSBFI the right to enjoy the land owned by the NHA with the obligation of preserving its form and substance, subject to the provisions of Proclamation No. 1670.

Usufruct may be constituted: (a) by law, as in MSBFI’s case; (b) by agreement: (c) in a last will and testament; and (d) by prescription. It may also be constituted on the whole or a part of the fruits of the land, in favor of one or more persons, simultaneously or successively, and in every case from or to a certain day, purely or conditionally.

As a usufructuary, MSBFI is entitled to, among others:

all natural, industrial, and civil fruits of the land;

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enjoy any increase which the land may acquire through accession, the servitudes established in its favor, and in general, all the benefits inherent therein;

enjoy the land, lease it to another, as it did in favor of Bulacan Garden Corp. and other stall holders in 1987, and alienate its right of usufruct, among others;

use things included in the land which cannot be used without being consumed, subject to its obligations in Article 574 of the Civil Code;

use the things included in the land, which, without being consumed, gradually deteriorate through wear and tear, in accordance with the purpose for which they are intended; and

make on the land useful improvements or expenses for mere pleasure as it may deem proper, provided he does not alter its form and substance; but he shall have no right to be indemnified therefore.

Before entering the land, MSBFI should have: (a) made, after notice to the NHA, an inventory of all the land, which shall contain an appraisal of the movables, and a description of the condition of the immovable, except when no one will be injured thereby; and (b) given security, binding itself to fulfill the obligations imposed upon him as usufructuary.

MSBFI should take care of the land as a good father of a family, and shall answer for any damage caused by the alienation or lease of its right of usufruct through the fault or negligence of the lessee or transferee. MSBFI is likewise obliged to make ordinary repairs needed by the land, while extraordinary expenses shall be at the NHA’s expense.

Moreover, MSBFI is liable for the payment of: (a) annual charges and taxes and of those considered as a lien on the fruits, for the duration of the usufruct; and (b) expenses, costs, and liabilities in suits brought with regard to the land.

A usufruct may be extinguished by: (a) the death of the usufructuary, unless a contrary intention clearly appears; (b) the expiration of the period for which it was constituted or by the fulfillment of any resolutory condition provided in the title creating the usufruct; (c) merger of the usufruct and ownership in the same person; (d) renunciation of the usufructuary; (e) total loss of the thing in usufruct; (f) termination of the right of the person constituting the usufruct; and (g) prescription.

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