Short answer. Yes. Article 549 makes the possessor in bad faith reimburse not only the fruits received but also those which the legitimate possessor could have received. He answers for the productive value he denied you, so letting the property sit idle is no defence to the claim.
What the law says
The possessor in bad faith shall reimburse the fruits received and those which the legitimate possessor could have received
Civil Code, Article 549 — Possessor In Bad Faith: Fruits. Read the full provision →
The measure is your loss, not his gain
This is the part that surprises people. If the occupant collected rent, he hands the rent over — that much is intuitive. But the article adds the fruits which the legitimate possessor could have received, and the reference point is deliberately you rather than him. So an occupier who lived in the house himself, or who left productive farmland fallow, or who ran it badly and earned nothing, does not escape by showing an empty till. What he owes is what the property would have yielded in the hands of the person entitled to it.
Working out the figure
Because it is hypothetical income, it has to be built from evidence rather than asserted. Rental rates for comparable property in the same area over the same years, the yield and prevailing price of the crop the land was planted to, or the documented income of the business the premises housed before the occupation. Then the period, which runs from when bad faith began rather than from when possession did — a possessor can start in good faith and become a possessor in bad faith once he learns of the defect in his claim, and the accounting follows that change.
What he can set off against it
Not much, and the article is precise about it: the necessary expenses of preserving the thing, and the expenses of production, gathering and preservation of fruits under Article 443. Useful improvements are not on that list, so money spent making the property better is simply lost to him. Expenses for pure luxury or mere pleasure are not refunded either, though he may remove those objects if the property suffers no injury — and even then only if you do not prefer to keep them by paying what they are worth when you take possession.
Fix the date bad faith began
Everything above is priced from it, so it is the fact worth establishing first. The usual markers are a demand letter, a notice of your claim, the service of a complaint, or an annotation the occupant must have seen — anything showing he knew of the flaw in his right and stayed. Keep proof of receipt for each. On your side, preserve whatever shows what the property could have earned: old lease contracts, receipts from before the occupation, and harvest or sales records for comparable years.
Cases citing this provision
These Supreme Court decisions cite the provision above. We list them so you can read them yourself; the summaries of what each decided are not ours to give.
- Corinthian Gardens Association Inc. vs. Sps. Reynaldo and Maria Luisa Tanjangco, et al, G.R. No. 160795, June 27, 2008 — read the decision on LawPhil →
- Manuel B. Aloria etc. vs. Estrellita B. Clemente, G.R. No. 165644, February 28, 2006 — read the decision on LawPhil →
- Heirs of Cerila Gamos, et al. vs. Heirs of Juliano Frando, et al, G.R. No. 149117, December 16, 2004 — read the decision on LawPhil →
- Enrica Quevada, et al. vs. Pomposa Glorioso, et al, G.R. No. 121270, August 27, 1998 — read the decision on LawPhil →
Related provisions
- Civil Code, Article 549 — Possessor In Bad Faith: Fruits
- Civil Code, Article 546 — Necessary and Useful Expenses
- Civil Code, Article 443 — Expenses on Fruits