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Davao Saw Mill v. Castillo

The Davao Saw Mill operated on leased land and erected buildings to house machinery used in its sawmill operations. The lease contract specified that improvements and buildings would become property of the landowner except for the machinery. When Davao Saw Mill was subject to a writ of execution, the sheriff levied the machinery. Davao Saw Mill argued the machinery became immovable property. However, the court ruled that machinery remains movable property when placed on leased land by a tenant and did not become immovable property by destination. Therefore, the machinery could be levied under the writ of execution.

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99 views1 page

Davao Saw Mill v. Castillo

The Davao Saw Mill operated on leased land and erected buildings to house machinery used in its sawmill operations. The lease contract specified that improvements and buildings would become property of the landowner except for the machinery. When Davao Saw Mill was subject to a writ of execution, the sheriff levied the machinery. Davao Saw Mill argued the machinery became immovable property. However, the court ruled that machinery remains movable property when placed on leased land by a tenant and did not become immovable property by destination. Therefore, the machinery could be levied under the writ of execution.

Uploaded by

MikkaEllaAncla
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

Davao Saw Mill v.

Castillo
61 Phil. 709

FACTS:
Davao Saw Mill operated a sawmill in Ma-a, but the land upon which the business was
conducted belonged to another person. On the land, Davao Saw Mill erected a building which
housed the machinery used by it. The machines were placed and mounted on foundation of
cement.

The contract of lease between Davao Saw Mill and the owner provided that all improvements
and buildings introduced and erected by Davao Saw Mill on the land shall pass to the exclusive
property of the owner with the exception that the machineries and accessories are not included
as improvements.

In another action brought by Davao Light against Davao Saw Mill, a judgement was rendered
against the latter and a Writ of Execution was issued thereon, and the machines were levied as
personalty, by the sheriff.

ISSUE: Whether or not the machineries are considered an immovable property by destination,
thus cannot be levied.

RULING:
NO. Machines are movables by nature and only becomes immobilized when placed in a plant by
the owner of the property or in a plant by the owner of property or plant. Such result would not
be accomplished by the placing of the machinery in a plant by a tenant or usufructuary or any
person having only a temporary right.

It follows that the machinery placed by Davao Saw Mill to the building did not lose its character
of being a movable property, and did not become an immovable property by desination. Hence,
could be levied.

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