G.R. No. L-16351; June 30, 1964
CALAPAN LUMBER COMPANY, INC., plaintiff-appellee, vs. COMMUNITY SAWMILL COMPANY, ET AL., defendants-appellants.

FACTS

Calapan Lumber Company, Inc. constructed and maintained a road and bridge in Oriental Mindoro at its exclusive expense from 1950 to 1952, with the knowledge and consent of the Provincial Board. The company secured road-right-of-way agreements from private landowners and contributed to the road’s maintenance. The Provincial Board initially passed resolutions allowing the public to use the road, with the restriction that logging concerns required Calapan Lumber’s permission. However, the Community Sawmill Company and its individual owners used the road for their logging operations without such permission. Subsequently, the Provincial Board passed Resolution No. 186, which revoked the prior resolutions and declared the road public. Calapan Lumber filed an action for injunction and damages, asserting private ownership over the road and seeking to exclude the sawmill company.
The Court of First Instance ruled in favor of Calapan Lumber, declaring the road to be of private ownership, making the injunction against the sawmill company permanent, and awarding attorney’s fees. The court also declared Resolution No. 186 null and void insofar as it declared the road public. The sawmill company appealed, contending the road was public and that the award of attorney’s fees was erroneous.

ISSUE

The primary issue is whether the road constructed by Calapan Lumber Company is private property, thereby allowing it to exclude other logging concerns, or a public road subject to general use.

RULING

The Supreme Court reversed the trial court’s judgment. The Court held that the road could not be declared private property. While Calapan Lumber built the road in good faith and at its own expense on land secured from private owners, the road served a public purpose by connecting communities. The provisions of the Civil Code on a builder in good faith (Articles 448 and 546) could not be invoked because paramount public interest was involved. The people living in the area were entitled to use the road. The Provincial Board’s act of declaring it public through Resolution No. 186 was valid in that respect, as the Board had the authority to declare roads public. However, the part of the resolution converting it into a toll road was invalid for lack of the required recommendation from the Secretary of Public Works and Communications and authorization from the President, as mandated by Section 2131 of the Revised Administrative Code. Consequently, the permanent injunction and the award of attorney’s fees were set aside. The Province was ordered to either reimburse Calapan Lumber for the construction cost with interest or, upon securing the proper authorization to make it a toll road, raise funds for reimbursement and refund tolls collected under the unauthorized resolution.