G.R. No. L-5872 November 29, 1954
ENRIQUE BERNARDO, ET AL., petitioners, vs. CRISOSTOMO S. BERNARDO and the COURT OF APPEALS, respondents.

FACTS

The Republic of the Philippines purchased the “Capellania de Tambobong” estate in Malabon, Rizal, from the Roman Catholic Church on December 31, 1947, under Commonwealth Act No. 539. This Act authorizes the resale of subdivided lots at reasonable prices to “their bona fide tenants or occupants.” Both respondent Crisostomo R. Bernardo and petitioners Enrique Bernardo, et al., applied to the Rural Progress Administration (RPA) to purchase the same lot. The RPA initially resolved to recognize the petitioners’ preferential right on January 12, 1948. Respondent Crisostomo appealed to the Court of First Instance of Rizal, which upheld his claim, and this decision was affirmed by the Court of Appeals.
The Court of Appeals found as incontestable facts that the disputed lot had been held under lease by respondent Crisostomo’s deceased parents and later by him continuously from 1912 to 1947, with rentals paid up to the government’s acquisition. The value of this leasehold right was about P4,000. The house on the lot was sold by petitioner Enrique Bernardo to respondent Crisostomo on July 13, 1944, a sale declared valid and final in a separate case. The petitioners were allowed to occupy the lot since 1918 out of deference and charity by the respondent and his parents, who were the rightful lessees. In 1945, the respondent required the petitioners to vacate the premises.

ISSUE

Whether or not petitioner Enrique Bernardo, who was gratuitously occupying the lot by mere tolerance of the lessee and did not own the house thereon at the time of the government’s acquisition, qualifies as a “bona fide occupant” entitled to preferential purchase under Commonwealth Act No. 539.

RULING

No. The Supreme Court affirmed the decision of the Court of Appeals, ruling that petitioner Enrique Bernardo is not a “bona fide occupant” as contemplated by Commonwealth Act No. 539. The Court defined a “bona fide occupant” as one who honestly believes in the validity of his title and is ignorant of any superior claim, akin to a possessor in good faith under civil law. The petitioner’s occupancy was precarious, being a mere licensee of the respondent, and he was duty-bound to restore possession upon demand. He had already sold the house on the lot in 1944 and had been asked to vacate in 1945. His occupancy, based on tolerance and charity, lacked the good faith and legitimate tenure required by the law. The Court emphasized that the term “bona fide occupant” was not designed to protect usurpers, squatters, intruders, or those occupying through breach of trust. The policy of the Homesite Acts favors those, like the respondent, who have maintained sincere and affirmative steps to own their land through continuous payment of obligations. The petitioner’s interest was deemed purely speculative.