Right of adjoining lot owner to purchase neighbor’s property

Dear PAO,

I have a lot near the market in a city. On this lot, I erected a stand where I sell fruits and vegetables. I am intending to sell it to my friend. A neighboring lot owner is asking me to sell my property to him, saying he has the right to buy it under the law since he is the adjoining owner. Is there a law that would compel me to sell my lot to an adjoining lot owner? Sincerely, Roberto

Dear Roberto,

The provision that finds application to your case is Article 1622 of the New Civil Code, considering that your lot is an urban land. It provides:

“ARTICLE 1622. Whenever a piece of urban land, which is so small and so situated that a major portion thereof cannot be used for any practical purpose within a reasonable time, having been bought merely for speculation, is about to be re- sold, the owner of any adjoining land has a right of pre- emption at a reasonable price.

If the re- sale has been perfected, the owner of the adjoining land shall have a right of redemption, also at a reasonable price.

Xxx xxx xxx” There are cases decided by the Supreme Court which state that an owner of an urban land may not redeem an adjoining urban property as in the case of Ortega vs. Orcineet al. ( G. R. No. L- 28317, March 31, 1971) penned by former Associate Justice Antonio Barredo. In this case, the Supreme Court resolved against the redemptioner for the following reason:

“Now, considering that the land, which appellant seeks to redeem, is 4,452 square meters in area, which is far from being ‘ so small and so situated that a major portion thereof cannot be used for any practical purpose’ for quite the contrary, it has been made a subdivision, and also that it cannot be said that appellee Esplana bought the same “merely for speculations” since in less than eight months, from March 27, 1965 when he bought it, to December 7, 1965 when the present complaint was into a subdivision for re- sale, which shows that he must have buying the same, it is our holding that appellant cannot invoke Article 1622 of the Civil Code. We cannot hold that such purpose is speculative. Xxx”

Also, in the case of Soriente vs. Court of Appeals ( G. R. No. L- 17343. August 31, 1963; ponente, former Chief Justice Roberto Concepcion), the Supreme Court denied the right of the plaintiff to redeem an urban land, to wit:

“Xxx ‘ that the land sought to be redeemed by plaintiff is . . . sufficiently big in area and so situated that the major portion or the whole thereof can serve comfortably as workshop and storage of machinery and equipment which defendant is putting up in the exercise and furtherance of his profession as professional mechanical engineer and associate electrical engineer;’ that ‘ in fact a portion of said lot is actually used for residential purposes . . .;’ and ‘ that defendant has no intention now or in the future to dispose of or sell the property subject matter of the present action to any person . . .’ Xxx”

From the foregoing, the right of pre- emption granted to an adjoining lot owner when an urban land is about to be re- sold is proper only when the subject lot is an urban lot, which is so small and so situated that a major portion thereof cannot be used for any practical purpose within a reasonable time, having been bought merely for speculation. Also, if the re- sale of the urban land has been perfected, the right of redemption of the adjoining lot owner is subject to the above- mentioned qualification. Hence, the preceding requirement must be proven in order for the adjoining lot owner you mentioned to exercise his right of preemption or right of redemption over the property.

We hope that we were able to answer your queries. Please be reminded that this advice is based solely on the facts you have narrated and our appreciation of the same. Our opinion may vary when other facts are changed or elaborated.