G.R. No. 125683 . March 2, 1999.
EDEN BALLATAN and SPS. BETTY MARTINEZ and CHONG CHY LING, petitioners, vs. COURT OF APPEALS, GONZALO GO, WINSTON GO, LI CHING YAO, ARANETA INSTITUTE OF AGRICULTURE and JOSE N. QUEDDING, respondents.

FACTS

Petitioners are the registered owners of Lot No. 24. Respondent Winston Go constructed a house on the adjacent Lot No. 25, owned by his father Gonzalo Go, Sr. During her own construction in 1985, petitioner Ballatan discovered that the concrete fence and pathway of the Go property encroached upon the entire eastern side of her lot. Surveys confirmed that Lot No. 24 lost area, while Lot No. 27, owned by respondent Li Ching Yao, gained area, indicating a westward shift of the intervening lots. Despite demands, respondents Go refused to remove the encroaching structures.
Petitioner Ballatan filed an action for recovery of possession. The trial court ruled in her favor, ordering the Gos to vacate, demolish the improvements, and pay damages. It dismissed the Gos’ third-party complaint against the subdivision developer (AIA), the surveyor (Jose Quedding), and the adjacent owner (Li Ching Yao). The Court of Appeals modified this decision. It affirmed the dismissal against AIA but reinstated the complaint against Li Ching Yao and Quedding. Crucially, instead of ordering demolition, it directed the Gos to pay petitioners the value of the encroached land and ordered Li Ching Yao to indemnify the Gos for the area he gained.

ISSUE

Whether the Court of Appeals erred in not ordering the demolition of the encroaching structures and in instead compelling the petitioners to accept payment for the encroached portion of their land.

RULING

Yes, the Court of Appeals erred. The Supreme Court reversed its decision and reinstated the trial court’s judgment ordering demolition. The core legal principle is that ownership is indivisible and the right to possess flows from it. A landowner has the right to enjoy and dispose of their property without unlawful interference. The Gos’ structures encroached upon the petitioners’ titled property. While the Gos may have been builders in good faith, having constructed based on a survey, this status does not defeat the owner’s fundamental right to recover possession. The law provides remedies for a builder in good faith, such as indemnity for improvements or a right of retention, but these are personal rights that cannot force a sale upon the unwilling landowner. The owner’s choice of remedy is paramount. The petitioners consistently demanded the return of their land and never consented to sell the encroached portion. Therefore, the appellate court could not compel them to accept payment and lose part of their property. The proper remedy was to restore possession by ordering the removal of the encroachments, with the Gos’ rights against other parties for reimbursement to be pursued separately.