G.R. No. L‑2890

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FACTS
– Plaintiff Valentina Palma claimed ownership of a parcel of land.
– In 1872 a flood submerged part of the land, creating an estuary that Palma and her tenants used as a fishery until March 1904.
– Defendant Jorge Fernandez, under a licence purportedly issued by the Municipality of Binmaley, erected a fishing apparatus in the estuary and harvested fish, causing Palma damages of ₱500.
– The trial court ruled the land (including the estuary) belonged to Palma and ordered the defendants to pay ₱170 in damages.
– The defendants appealed by bill of exceptions, contending the estuary is a public waterway (a tidal stream) over which the municipality has authority to grant fishing privileges.

ISSUE
1. Is the inundated estuary a public waterway subject to municipal control under Act No. 303, the 1866 Law of Waters, or Article 407 of the Civil Code?
2. Is the Municipality of Binmaley liable for damages caused by the unlawful acts of its licensee, Fernandez?

RULING
– Public‑property determination: The Court held that the estuary is not a river or stream; it is an insignificant, tide‑affected water body that is dry at times and lacks a perpetual current. Consequently, it does not fall within the definition of public water under Act No. 303, the Law of Waters, or Article 407.
– Municipal liability: The only act of the municipality was the issuance of a licence to Fernandez, the terms of which were never presented in evidence. The Court ruled that a mere licence, without any affirmative municipal act authorising the specific fishing activity, does not make the municipality liable for the licensee’s wrongful acts.
– Disposition:
– Judgment against Fernandez is AFFIRMED.
– Judgment against the Municipality of Binmaley is REVERSED; it is absolved of liability with the costs of the first instance.
– No costs are awarded to either party in the Supreme Court.

The case was ordered to be remanded to the trial court after judgment entry for appropriate action.