Short answer. No. A neighbor's encroachment is a mere act of trespass, and the Civil Code says that a mere act of trespass shall not authorize the suspension of the payment of the price. Suspension is only allowed when a real threat to your ownership exists, such as a vindicatory action or a foreclosure of mortgage.
What the law says
A mere act of trespass shall not authorize the suspension of the payment of the price.
Civil Code, Article 1590 — Buyer's Right to Suspend Payment. Read the full provision →
When the law allows you to suspend payment
Article 1590 of the Civil Code gives buyers a specific right to hold back the price — but only in serious situations. You may suspend payment if you are actually disturbed in your possession or ownership of the property, or if you have reasonable grounds to fear such disturbance, specifically through a vindicatory action (a court case filed by someone claiming ownership) or a foreclosure of mortgage. These are formal legal proceedings that put your title at genuine risk. A neighbor simply entering or using a portion of your land, without filing a court case, is a different matter entirely.
Why a neighbor's encroachment is not enough
The law draws a clear line: a mere act of trespass does not authorize suspension of payment. An encroachment by a neighbor — even one that is irritating and ongoing — is treated as trespass, not as a vindicatory action or mortgage foreclosure. Your seller is still owed the price. The reason is practical: trespass is a wrong you can address through other means (an injunction, a forcible entry case, or direct negotiation), and it does not mean your title to the property is in dispute the way a court ownership claim would.
Exceptions that could still let you suspend
Two situations could change the picture. First, if the trespassing neighbor eventually files a court case claiming ownership over the portion they are occupying, that becomes a vindicatory action — and then suspension may be available. Second, if there is a mortgage on the property that is being foreclosed, Article 1590 also allows suspension. Outside those scenarios, your obligation to pay continues. Even if you rightfully fear trouble, the law requires an actual legal proceeding to trigger the right, not just a factual encroachment.
What to do instead
If a neighbor is encroaching, you still have real remedies — you can demand they stop, send a formal demand letter, or file a complaint for forcible entry in the Municipal Trial Court if the encroachment is recent. Separately, you can pursue your seller for warranty against eviction if the encroachment ultimately results in a final judgment dispossessing you. What you cannot do is simply stop paying the price and justify it by pointing to the neighbor. The obligation to pay and the dispute with the neighbor are legally separate.
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.
- Central Bank of the Philippines vs. Spouses Alfonso and Anacleta Bichara, G.R. No. 131074, March 27, 2000 — read the decision on LawPhil →
- Arra Realty Corp., et al. vs. Guarantee Development Corp. and Insurance Agency, et al, G.R. No. 142310, September 20, 2004 — read the decision on LawPhil →
- Corinthian Realty, Inc. vs. Hon. Court of Appeals and Emilio Martin (now deceased), Matilde Martin, Teofilo Guinto (now deceased), Delfin Guinto, Prudencio Guinto and Margarita Guinto, G.R. No. 150240, December 26, 2002 — read the decision on LawPhil →