1

THIRD DIVISION

1.
Petitioner, - versus COURT OF APPEALS and NATIONAL HOUSING AUTHORITY, Respondents. x- - - - - - - - - - - - - - - - - - - - - - - - -x DOMINGO LIM, G.R. No. 116176 Petitioner, - versus COURT OF APPEALS and NATIONAL HOUSING AUTHORITY, Respondents. x- - - - - - - - - - - - - - - - - - - - - - - - -x NATIONAL HOUSING G.R. Nos. 116491-503 AUTHORITY, Petitioner, Present: YNARES-SANTIAGO, J., - versus - Chairperson, AUSTRIA-MARTINEZ, CHICO-NAZARIO, MAXIMO LOBERANES, NACHURA, and ELADIO QUIMQUE, CESARIO REYES, JJ. VEGA, JUANITO SANTOS,

FERMIN MANAPAT, G.R. No. 1104781

ALEJANDRO ORACION and Promulgated: GONZALO MERCADO, Respondents. October 15, 2007 DECISION NACHURA, J.: For the resolution of the Court are three consolidated petitions for review on certiorari under Rule 45 of the Rules of Court. G.R. No. 110478 assails the May 27, 1993 Decision2 of the Court of Appeals (CA) in CA-G.R. CV Nos. 10200-10212. G.R. No. 116176 questions the June 28, 1994 Decision3 of the appellate court in CA-G.R. CV No. 27159. G.R. Nos. 116491-503 assails the March 2, 1994 and the July 25, 1994 Resolutions4 of the CA also in CA-G.R. CV Nos. 10200-10212. The three-decade saga of the parties herein has for its subject parcels of land forming part of what was originally known as the Grace Park Subdivision in Caloocan City and formerly owned by the Roman Catholic Archbishop of Manila (RCAM) and/or the Philippine Realty Corporation (PRC). The Facts Sometime in the 1960s, RCAM allowed a number of individuals to occupy the Grace Park property on condition that they would vacate the premises should the former push through with the plan to construct a school in the area. The plan, however, did not materialize, thus, the occupants offered to purchase the portions they occupied. Later, as they could not afford RCAMs proposed price, the occupants, organizing themselves as exclusive members of the Eulogio Rodriguez, Jr. Tenants Association, Inc., petitioned the Government for the acquisition of the said property, its subdivision into home lots, and the resale of the subdivided lots to them at a low price.5 Acting on the associations petition, the Government, in 1963, through the Land Tenure Administration (LTA), later succeeded by the Peoples Homesite and Housing Corporation (PHHC), negotiated for the acquisition of the property from RCAM/PRC. But because of the high asking price of RCAM and the budgetary constraints of the Government, the latters effort to purchase and/or to expropriate the property was discontinued. RCAM then decided to effect, on its own, the subdivision of the property and the sale of the individual subdivided lots to the public.6 Petitioners Manapat and Lim and respondents Loberanes, Quimque, Vega, Santos, Oracion and Mercado in these consolidated cases were among those who purchased individual subdivided lots of Grace Park directly from RCAM and/or PRC.7 A significant turn of events however happened in 1977 when the late President Ferdinand E. Marcos issued Presidential Decree (PD) No. 1072,8 appropriating P1.2M out of the Presidents Special Operations Funds to cover the additional amount needed for the expropriation of Grace Park. The National Housing Authority (NHA), PHHCs successor, then filed several expropriation proceedings over the already subdivided lots for the purpose of developing Grace Park under the Zonal Improvement Program (ZIP) and subdividing it into small lots for distribution and resale at a low cost to the residents of the area.9 The following cases were filed by the NHA with the Regional Trial Court (RTC) of Caloocan City: C-6225, C-6226, C-6227, C-6228, C6229, C-6230, C-6231, C-6232, C-6233, C-6234, C-6235, C-6236, C-6237, C-6238, C-6255 and C-6435.10 After due proceedings, the trial court rendered separate decisions dismissing the expropriation cases, with the exceptions of Cases Nos. C-6233 and C6236 in which it ordered the condemnation of the involved lots.11 On motion for reconsideration by the NHA in Cases Nos. C-6227, C-6228, C-6230, C-6234, C-6235, C-6238 and C-6255, the trial court later amended its decision, set aside its dismissal of the said cases, ordered the condemnation of the involved lots and fixed the amount of just compensation at P180.00 per square meter. In Cases Nos. C-6225, C-6229, C-6231, C-6232, C-6237 and C-6435, the RTC however denied NHAs motion for reconsideration.12 NHA eventually appealed to the CA the decisions in Cases Nos. C-6225, C-6229, C-6231, C-6232, C-6237 and C-6435 on the issue of the necessity of the taking, and the amended ruling in Cases Nos. C-6227, C-6228, C-6230, C-6234, C-6235, C-6238 and C-6255 on the issue of just compensation.13 The CA consolidated the appeals and docketed them as CA-G.R. CV No. 10200-10212. NHA likewise filed with the CA an appeal from the decision in C-6226, which was docketed as CA-G.R. CV No. 27159. On May 27, 1993, the appellate court rendered its Decision14 in CA-G.R. CV No. 10200-10212 disposing of the appealed cases as follows: WHEREFORE, premises considered, judgment is hereby rendered: 1) Reversing and setting aside the decisions of dismissal in Cases Nos. C-6225, C-6229, C-6231, C-6232, C-6237 and C-6435; and in lieu thereof an order of condemnation is entered declaring that plaintiff-appellant NHA has a lawful right to take the lots involved for the public use described in the complaints;

2) Affirming the decisions in Case Nos. C-6227, C-6228, C-6234, C-6235, C-6238 and C-6255 insofar as said decision granted the expropriation; declaring that plaintiff-appellant NHA has a lawful right to take the lots involved for the public use stated in the complaint; but annulling and setting aside the just compensation fixed by the trial court at P180.00 per square meter in the said cases; 3) Ordering the remand of all the appealed cases, except for Case No. C-6230, to the trial court for determination of the just compensation to which defendants are entitled in accordance with Rule 67 of the Revised Rules of Court; 4) Finding the compromise agreement in Case No. C-6230, entitled, "NHA v. Aurora Dy dela Costa, et al." in accordance with law, and not contrary to morals or public policy, and rendering judgment in accordance therewith; 5) Ordering Remedios Macato to be joined as defendant with Julia C. Diaz in Case No. C-6227. No pronouncement as to costs. SO ORDERED.15 Rosemarie and Dolores Guanzon, two of the owners of the lots in C-6225, filed before this Court a petition for review on certiorari of the aforesaid decision of the appellate court [Their petition was docketed as G.R. Nos. 110462-74]. On September 5, 1994, we dismissed their petition for failure to sufficiently show that the CA had committed any reversible error in the challenged decision.16 An Entry of Judgment was issued on February 2, 1995.17 Likewise, Julia Diez and Remedios Macato, the owners of the lots in C-6227, assailed before us the afore-quoted CA decision through a petition under Rule 45. On July 28, 1993, however, in G.R. No. 110770, we denied their Motion for Extension of Time to file a petition for review on certiorari for their failure to submit an affidavit of service of the motion as required by Circular No. 19-91.18 After denying their motion for reconsideration,19 we issued an Entry of Judgment on August 27, 1993.20 Petitioner Manapat, the defendant-landowner in C-6229, also elevated the case before us via a petition for review on certiorari docketed as G.R. No. 110478.21 We initially dismissed this petition for having been filed out of time,22 but we reinstated it on motion for reconsideration.23 In the meantime, the other defendants-landowners in the expropriation casesRCAM/PRC in C-6225, Maximo Loberanes and Eladio Quimque in C-6231, Alejandro Oracion, Gonzalo Mercado, Cesario Vega and Juanito Santos in C-6435, and Remedios Macato in C-6227moved for the reconsideration of the said May 27, 1993 Decision of the CA.24 In the March 2, 1994 Resolution,25 the appellate court resolved the motions in this wise: WHEREFORE, premises considered, the motion for reconsideration of movants Roman Catholic Archbishop of Manila and Philippine Realty Corporation (in Special Civil Action No. 6225) and movant-intervenor Remedios Macato (in Special Civil Action No. 6227) are DENIED. The motions for reconsideration of movants Gonzalo Mercado, Cesario Vega and Juanito Santos (in Special Civil Action No. 6435) and movants Maximo Loberanes and Eladio Quimque (in Special Civil Action No. 6231) are GRANTED. The motion for reconsideration of movant Alejandro Oracion (in Special Civil Action No. 6435) is partially granted to the extent of Three Hundred (300) square meters of Lot 22, Block 157. The decision of this Court promulgated May 27, 1993 is accordingly MODIFIED. Lot No. 26, Block No. 157 owned by Cesario Vega and Juanito Santos, and Lot No. 4, Block No. 157 owned by Maximo Loberanes and Eladio Quimque are declared exempt from expropriation and the corresponding complaints for expropriation (sic) DISMISSED insofar as said lots are concerned. Lot No. 22, Block No. 157 owned by movant Alejandro Oracion is declared exempt from expropriation to the extent of Three Hundred (300) square meters. Only the remaining Ninety (90) square meters shall be the subject of expropriation, the portion to be determined by the lower court in the manner most beneficial to the owner and consistent with the objective of PD 1072. SO ORDERED.26 Aggrieved by the said March 2, 1994 CA Resolution specifically with regard to the exemption from expropriation of the lots of Loberanes, Quimque, Mercado, Vega and Santos, and the partial exemption of the lot of Oracion, NHA moved for the reconsideration of the same. In the subsequent July 25, 1994 Resolution,27 the appellate court denied NHAs motion, together with the belated motion of Vivencio S. de Guzman, the defendant-landowner in C6255. The dispositive portion of the July 25, 1994 Resolution reads: WHEREFORE, the motions for reconsideration of defendant-appellant Vivencio S. de Guzman of the decision promulgated May 27, 1993 and of plaintiffappellant National Housing Authority of the resolution promulgated March 2, 1994 are DENIED. SO ORDERED.28

With the denial of its motion for reconsideration, NHA filed with this Court a Consolidated Petition for Review 29 under Rule 45, as aforesaid, assailing the March 2, 1994 and the July 25, 1994 Resolutions of the appellate court. NHAs petition was docketed as G.R. Nos. 116491-503 against respondents Loberanes and Quimque (in C-6231), Vega, Santos, Oracion and Mercado (in C-6435). In a separate development, the CA, on June 28, 1994, rendered its Decision30 in CA-G.R. CV No. 27159, reversing the RTCs ruling in C-6226. The fallo of the decision reads: WHEREFORE, FOREGOING PREMISES CONSIDERED, the appealed decision dated October 29, 1986 is hereby REVERSED for want of merit. Let the record of this case be remanded to the court of origin for further proceedings. IT IS SO ORDERED.31 Discontented with the appellate courts ruling, petitioner Domingo Lim, one of the owners of the lots subject of C -6226, elevated the case to us via a petition for review on certiorari docketed as G.R. No. 116176.32 The Issues Thus, for resolution by this Court are the following consolidated cases: (1) G.R. No. 110478 of Manapat; (2) G.R. Nos. 116491-503 of the NHA; and (3) G.R. No. 116176 of Lim. In G.R. No. 110487, petitioner Manapat argues in the main that, as he is also a member of the tenant association, the beneficiary of the expropriation, it would be incongruous to take the land away from him only to give it back to him as an intended beneficiary. Accordingly, the CA, in its May 27, 1993 Decision in CA-G.R. CV No. 10200-10212, should not have allowed the expropriation of his lot. To further support his stance, Manapat raises the following grounds: I THE COURT OF APPEALS ERRED IN HOLDING THAT THE ISSUANCE MADE IN THE EXERCISE OF LEGISLATIVE POWER, SPECIFYING THE LOTS TO BE EXPROPRIATED AND THE PURPOSE FOR WHICH THEY ARE INTENDED, REMOVES FROM THE JUDICIARY THE DETERMINATION OF THE NECESSITY OF THE TAKING, THERE BEING NO SHOWING OF ABUSE OF DISCRETION.33 II SUPERVENING EVENT RENDERS IMPROPER THE DISPOSITION BY THE COURT OF APPEALS FOR AN ORDER OF CONDEMNATION DECLARING THAT NHA HAS A LAWFUL RIGHT TO TAKE THE LOT OF FERMIN MANAPAT FOR SUPPOSED PUBLIC USE AND FOR REMAND OF HIS CASE TO THE TRIAL COURT FOR DETERMINATION OF JUST COMPENSATION.34 III THE COURT OF APPEALS SHOULD HAVE CONSIDERED THAT FERMIN MANAPAT IS NOT ONLY A BONA FIDE OCCUPANT IN THE GRACE PARK SUBDIVISION FOR PURPOSES OF P.D. 1072 BUT LIKEWISE HAS A TRANSFER CERTIFICATE OF TITLE NO. 42370 OF THE REGISTRY OF DEEDS FOR THE CITY OF CALOOCAN OVER THE SAME LOT SOUGHT TO BE EXPROPRIATED WHICH SHOULD NOT BE SUBJECT TO COLLATERAL ATTACK AS DISPOSED BY THE COURT OF APPEALS.35 IV THE COURT OF APPEALS SHOULD HAVE CONSIDERED THAT THE EVENTUAL BENEFICIARIES OF ITS BENEVOLENT EXPROPRIATION ARE SQUATTERS. 36 NHA, in its petition in G.R. Nos. 116491-503, primarily contends that the CA erred when it issued its March 2, 1994 Resolution and modified the May 27, 1993 Decision in CA-G.R. CV No. 10200-10212 to the extent that it applied retroactively Article VI, Section 10 of Republic Act (R.A.) No. 7279, thus exempting from expropriation the 300-sq m lots of respondents Loberanes, Quimque, Vega, Santos, Oracion and Mercado. NHA summarized its arguments as follows: I The Honorable Court of Appeals erred in applying retroactively Article VI, Section 10 of Republic Act No. 7279 to the subject expropriation cases instituted back in 1977 by petitioner-appellant NHA.37 A. Republic Act 7279 passed in 1992 should operate prospectively and, therefore, should not be given retroactive effect.38

Republic Act 7279 is a substantive and penal law with a penalty clause which cannot apply retroactively especially to pending actions.39 B. Republic Act No. 7279 and PD 1072 are not in pari materia.40 The retroactive application of Article VI, Section 10 of RA 7279 will affect vested rights of petitioner-appellant NHA arising from its exercise of the power of eminent domain.41 II The Honorable Court of Appeals erred in ignoring the impractical consequences resulting from a selective expropriation of lots.42 In G.R. No. 116176, petitioner Lim, a non-member of the tenant association who bought from RCAM/PRC four lots of the subdivided Grace Park Subdivision,43 argues as follows: 1 Respondent NHA may not, as it would herein, legally re-group several smaller lots into which a much bigger lot had previously been subdivided, and consider and treat them as one again for the purpose of subdividing it once more into still smaller lots for distribution to its supposed or intended beneficiaries.44 2 There really was no genuine necessity for the expropriation of the lots in question to satisfy the purpose thereof as alleged in the complaint therefor.45 3 Respondent Court did not sustain the clear finding of the trial court that no evidence sufficient to prove its claim that the expropriation of said lots and subdividing them again into much smaller lots for resale to their present occupants would provide the latter with more healthful, decent and peaceful surroundings and thus improve the quality of their lives was ever presented by respondent NHA.46 Stripped of non-essentials, the petitions raise only one fundamental issue, and that is, whether the NHA may validly expropriate the parcels of land subject of these cases. The Courts Ruling The power of eminent domain is an inherent and indispensable power of the State. Also called the power of expropriation, it is described as "the highest and most exact idea of property remaining in the government" that may be acquired for some public purpose through a method "in the nature of a compulsory sale to the State."47 By virtue of its sovereign character, the exercise of the power prevails over the non-impairment clause,48 and is clearly superior to the final and executory judgment rendered by a court in an ejectment case.49 Being inherent, the power need not be specifically conferred on the government by the Constitution. Section 9, Article III of the Constitution, which mandates that "private property shall not be taken for a public use without just compensation," merely imposes a limit on the governments exercise of the power and provides a measure of protection to the individuals right to property.50 Just like its two companion fundamental powers of the State,51 the power of eminent domain is exercised by the Legislature. However, it may be delegated by Congress to the President, administrative bodies, local government units, and even to private enterprises performing public services.52 Albeit the power partakes of a sovereign character, it is by no means absolute. Its exercise is subject to limitations, one of which is, precisely, Section 9, Article III of the Constitution. Over the years and in a plethora of cases, this Court has recognized the following requisites for the valid exercise of the power of eminent domain: (1) the property taken must be private property; (2) there must be genuine necessity to take the private property; (3) the taking must be for public use; (4) there must be payment of just compensation; and (5) the taking must comply with due process of law.53 Accordingly, the question that this Court must resolve is whether these requisites have been adequately addressed. It is incontrovertible that the parcels of land subject of these consolidated petitions are private property. Thus, the first requisite is satisfied.

With respect to the second, it is well to recall that in Lagcao v. Judge Labra,54 we declared that the foundation of the right to exercise eminent domain is genuine necessity, and that necessity must be of a public character. As a rule, the determination of whether there is genuine necessity for the exercise is a justiciable question.55 However, when the power is exercised by the Legislature, the question of necessity is essentially a political question.56 Thus, in City of Manila v. Chinese Community,57 we held: The legislature, in providing for the exercise of the power of eminent domain, may directly determine the necessity for appropriating private property for a particular improvement for public use, and it may select the exact location of the improvement. In such a case, it is well-settled that the utility of the proposed improvement, the extent of the public necessity for its construction, the expediency of constructing it, the suitableness of the location selected and the consequent necessity of taking the land selected for its site, are all questions exclusively for the legislature to determine, and the courts have no power to interfere, or to substitute their own views for those of the representatives of the people. In the instant cases, the authority to expropriate came from Presidential Decree No. 1072, issued by then President Ferdinand E. Marcos in 1977. At that time, and as explicitly recognized under the 1973 Constitution, President Marcos had legislative powers. Perforce, the expropriation of the subject properties identified with specificity in the P.D. --- was directed by legislation. The issue of necessity then assumed the nature of a political question. As to the third requisite of "public use," we examine the purpose for which the expropriation was undertaken by NHA. As set forth in its petition, NHA justifies the taking of the subject property for the purpose of improving and upgrading the area by constructing roads and installing facilities thereon under the Governments zonal improvement program and subdividing them into much smaller lots for distribution and sale at a low cost to qualified beneficiaries, mostly underprivileged long-time occupants of Grace Park. Around 510 families with approximately 5 members each will be benefited by the project.58 The only remaining obstacle in the completion of this project is the lots subject of these consolidated petitions as the other lots in Grace Park have already been expropriated.59 The Zonal Improvement Program (ZIP), being implemented for government by NHA, draws breath from policy mandates found in the 1987 Constitution.60 It is an integral part of the governments "socialized housing" program which, in Sumulong v. Guerrero,61 we deemed compliant with the "public use" requirement, it being a program clearly devoted to a "public purpose." Justice Irene R. Cortes, speaking eloquently for the Court, said: "Socialized housing" is defined as, "the construction of dwelling units for the middle and lower class members of our society, including the construction of the supporting infrastructure and other facilities" (Pres. Decree No. 1224, par. 1). This definition was later expanded to include among others: a) The construction and/or improvement of dwelling units for the middle and lower income groups of the society, including the construction of the supporting infrastructure and other facilities; b) Slum clearance, relocation and resettlement of squatters and slum dwellers as well as the provision of related facilities and services; c) Slum improvement which consists basically of allocating homelots to the dwellers in the area or property involved, rearrangement and re-alignment of existing houses and other dwelling structures and the construction and provision of basic community facilities and services, where there are none, such as roads, footpaths, drainage, sewerage, water and power system, schools, barangay centers, community centers, clinics, open spaces, parks, playgrounds and other recreational facilities; d) The provision of economic opportunities, including the development of commercial and industrial estates and such other facilities to enhance the total community growth; and e) Such other activities undertaken in pursuance of the objective to provide and maintain housing for the greatest number of people under Presidential Decree No. 757. (Pres. Decree No. 1259, sec. 1) xxxx Specifically, urban renewal or redevelopment and the construction of low-cost housing is recognized as a public purpose, not only because of the expanded concept of public use but also because of specific provisions in the Constitution. The 1973 Constitution made it incumbent upon the State to establish, maintain and ensure adequate social services including housing [Art. II, sec. 7]. The 1987 Constitution goes even further by providing that: The State shall promote a just and dynamic social order that will ensure the prosperity and independence of the nation and free the people from poverty through policies that provide adequate social services, promote full employment, a rising standard of living and an improved quality of life for all. [Art. II, sec. 9] The state shall, by law, and for the common good, undertake, in cooperation with the private sector, a continuing program of urban land reform and housing which will make available at affordable cost decent housing and basic services to underprivileged and homeless citizens in urban centers and resettlement areas. It shall also promote adequate employment opportunities to such citizens. In the implementation of such program the State shall respect the rights of small property owners. (Art. XIII, sec. 9, Emphasis supplied)

Housing is a basic human need. Shortage in housing is a matter of state concern since it directly and significantly affects public health, safety, the environment and in sum, the general welfare. The public character of housing measures does not change because units in housing projects cannot be occupied by all but only by those who satisfy prescribed qualifications. A beginning has to be made, for it is not possible to provide housing for all who need it, all at once. Population growth, the migration to urban areas and the mushrooming of crowded makeshift dwellings is a worldwide development particularly in developing countries. So basic and urgent are housing problems that the United Nations General Assembly proclaimed 1987 as the "International Year of Shelter for the Homeless" "to focus the attention of the international community on those problems". The General Assembly is "[s]eriously concerned that, despite the efforts of Governments at the national and local levels and of international organizations, the living conditions of the majority of the people in slums and squatter areas and rural settlements, especially in developing countries, continue to deteriorate in both relative and absolute terms." [G.A. Res. 37/221, Yearbook of the United Nations 1982, Vol. 36, p. 1043-4] In the light of the foregoing, this Court is satisfied that "socialized housing" falls within the confines of "public use". It is, particularly important to draw attention to paragraph (d) of Pres. Dec. No. 1224 which should be construed in relation with the preceding three paragraphs. Provisions on economic opportunities inextricably linked with low-cost housing, or slum clearance, relocation and resettlement, or slum improvement emphasize the public purpose of the project.62 It need only be added, at this juncture, that the "public use" requisite for the valid exercise of the power of eminent domain is a flexible and evolving concept influenced by changing conditions. At present, it may not be amiss to state that whatever is beneficially employed for the general welfare satisfies the requirement of public use.63 Still, petitioner Manapat insists that, being himself a beneficiary of the expropriation (because he has been a long-time resident of Grace Park), it would be incongruous for government to take his land away from him only to give it back to him. This contention sadly fails to comprehend the public purpose for the taking under the "socialized housing" program. The parcels of land subject of the expropriation are, precisely, being taken so that they can be subdivided into much smaller lots --- at an average of 66.5 square meters per lot64 --- for distribution to deserving dwellers in the area. Upon the completion of the project, Manapat, and those similarly situated as he, cannot assert any right to be awarded the very same lots they currently occupy, nor be entitled to the same area of the land they now have. Then, we have petitioner Lim and respondents Vega, Santos, Oracion, and Mercado, who argue that the lots they own should not be expropriated are already titled in their names and are very small in area, being already the subdivided portions of the original Grace Park Subdivision. We are not persuaded. J. M. Tuason & Co., Inc. v. Land Tenure Administration65 is instructive. In that case, this Court adopted the dissenting opinion of Justice J. B. L. Reyes in Republic v. Baylosis,66 that the propriety of exercising the power of eminent domain cannot be determined on a purely quantitative or area basis, given that the Constitution speaks of lands, not of landed estates. Speaking through Justice (later Chief Justice) Enrique M. Fernando, the Court said: This is not to say of course that property rights are disregarded. This is merely to emphasize that the philosophy of our Constitution embodying as it does what Justice Laurel referred to as its "nationalistic and socialist traits discoverable upon even a sudden dip into a variety of [its] provisions" although not extending as far as the "destruction or annihilation" of the rights to property, negates the postulate which at one time reigned supreme in American constitutional law as to their well-nigh inviolable character. This is not so under our Constitution, which rejects the doctrine of laissez faire with its abhorrence for the least interference with the autonomy supposed to be enjoyed by the property owner. Laissez faire, as Justice Malcolm pointed out as far back as 1919, did not take too firm a foothold in our jurisprudence. Our Constitution is much more explicit. There is no room for it for laissez faire. So Justice Laurel affirmed not only in the above opinion but in another concurring opinion quoted with approval in at least two of our subsequent decisions. We had occasion to reiterate such a view in the ACCFA case, decided barely two months ago. This particular grant of authority to Congress authorizing the expropriation of land is a clear manifestation of such a policy that finds expression in our fundamental law. So is the social justice principle enshrined in the Constitution of which it is an expression, as so clearly pointed out in the respective dissenting opinions of Justice J.B.L. Reyes and Chief Justice Paras in the Baylosis case. Why it should be thus is so plausibly set forth in the ACCFA decision, the opinion being penned by Justice Makalintal. We quote: "The growing complexities of modern society, however, have rendered this traditional classification of the functions of government quite unrealistic, not to say obsolete. The areas which used to be left to private enterprise and initiative and which the government was called upon to enter optionally, and only because it was better equipped to administer for the public welfare than is any private individual or group of individuals, continue to lose their well-defined boundaries and to be absorbed within activities that the government must undertake in its sovereign capacity if it is to meet the increasing social challenges of the times. Here as almost everywhere else the tendency is undoubtedly towards a greater socialization of economic forces. Here of course this development was envisioned, indeed adopted as a national policy, by the Constitution itself in its declaration of principle concerning the promotion of social justice." In a more recent decision,67 we had occasion to declare that the fact that the property is less than -hectare and that only a few would actually benefit from the expropriation does not diminish its public use character, inasmuch as "public use" now includes the broader notion of indirect public benefit or advantage, including in particular, urban land reform and housing.

The Courts departure from the land size or area test finds further affirmation in its rulings in Mataas na Lupa Tenants Association, Inc. v. Dimayuga68 and the aforecited Sumulong v. Guerrero.69 Given this discussion, it is clear that "public use," as a requisite for the exercise of eminent domain in the instant cases, has been adequately fulfilled. To satisfy the fourth requisite, we affirm the appellate courts disposition that the subject cases be remanded to the trial court for the determination of the amount of just compensation. Under case law, the said determination is a judicial prerogative.70 As to the observance of the fifth requisite, the due process clause, in the expropriation proceedings, all the parties have been given their day in court. That they are now before this Court is attestation enough that they were not denied due process of law. From the foregoing disquisitions, it is unmistakable that all the requirements for the valid exercise of the power of eminent domain have been complied with. Thus, our answer to the singular and fundamental issue in these consolidated cases is: YES, the NHA may validly expropriate the subject parcels of land. One final matter: the propriety of the application by the CA of R.A. No. 7279, otherwise known as the Urban Development and Housing Act of 1992. The Court is not unaware of the condition now imposed by R.A. No. 727971 that, for purposes of urban development and housing under the Act, where expropriation is resorted to, parcels of land owned by small property owners shall be exempted.72 "Small property owners" are owners of residential lands with an area not exceeding 300 sq m in highly urbanized cities and 800 sq m in other urban areas and who do not own any other real property.73 Invoking this limitation under the said law, the appellate court in the questioned rulings exempted from expropriation the lots owned by Loberanes, Quimque, Mercado, Vega and Santos, and partially exempted the lot of Oracion. The CAs ruling on this point is incorrect. R.A. No. 7279 was enacted in 1992, almost two decades after the expropriation cases against the property owners herein were instituted with the RTC in 1977. Nova constitutio futuris formam imponere debet, non praeteritis. A new statute should affect the future, not the past. The law looks forward, not backward.74 Article 4 of the Civil Code even explicitly declares, "(l)aws shall have no retroactive effect, unless the contrary is provided."75 In these consolidated cases, the Court finds that the language of R.A. No. 7279 does not suggest that the Legislature has intended its provisions to have any retroactive application. On the contrary, Section 49 of the said law indicates that it "shall take effect upon its publication in at least two (2) national newspapers of general circulation."76 The laws prospective application being clearly stated, the Court cannot agree with the disposition of the appellate court that the subject lots not exceeding 300 sq m are exempt from expropriation. WHEREFORE, PREMISES CONSIDERED, the May 27, 1993 Decision of the Court of Appeals in CA-G.R. CV No. 10200-10212 and the June 28, 1994 Decision in CA-G.R. CV No. 27159 are AFFIRMED; and the March 2, 1994 and the July 25, 1994 Resolutions in CA-G.R. CV Nos. 10200-10212 are REVERSED and SET ASIDE. SO ORDERED. ANTONIO EDUARDO B. NACHURA Associate Justice WE CONCUR: CONSUELO YNARES-SANTIAGO Associate Justice Chairperson MA. ALICIA AUSTRIA-MARTINEZ Associate Justice RUBEN T. REYES Associate Justice ATTESTATION MINITA V. CHICO-NAZARIO Associate Justice

I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Courts Division. CONSUELO YNARES-SANTIAGO Associate Justice Chairperson, Third Division CERTIFICATION Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson's Attestation, I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Courts Division. REYNATO S. PUNO Chief Justice

APPROPRIATING THE AMOUNT OF ONE MILLION TWO HUNDRED THOUSAND PESOS TO COVER THE ADDITIONAL AMOUNT NEEDED FOR THE EXPROPRIATION OF 51 LOTS OF THE GRACE PARK SUBDIVISION IN CALOOCAN CITY WHEREAS, upon petition of the occupants, the defunct People's Homesite and Housing Corporation authorized on November 27, 1964, the expropriation of 51 lots of Block 157, 158 and 159 of the Grace Park Subdivision situated in Caloocan City, totaling 18,427.5 sq. m., and requested the Office of the President the sum of Six Hundred Forty Five Thousand (P645,000.00) Pesos needed to acquire that said lots at P35.00 per square meter. WHEREAS, the Treasurer of the Philippines was able to release the requested sum of P645,000.00 to the National Housing Authority only on February 12, 1976, at which time the market value of the said lots had increased from P35.00 per square meter to an average of P100 per square meter, or a total of P1.85 million, thereby making the amount released to the National Housing Authority inadequate by One Million Two Hundred Thousand (P1,200,000.00) Pesos. NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by the Constitution do hereby order and decree: SECTION 1. The sum of One Million Two Hundred Thousand (P1,200,000.00) Pesos is hereby appropriated out of the President's Special Operations Funds, to cover the additional amount needed to expropriate the 51 lots of Block 157, 158 and 159 of the Grace Park Subdivision in Caloocan City, for resale to the bona fide occupants therein. SECTION 2. This Decree shall take effect immediately. Done in the City of Manila, this 25th day of January, in the year of Our Lord, nineteen hundred and seventy-seven. 39. Having been placed in possession of the subject properties, plaintiff prepared the development plans and detailed engineering for the area (T.S.N. of Engr. Ramon Ronquillo, pp. 14-15, March 9, 1981). The development plans as approved by the petitioner and the City Government of Caloocan City called for the construction of footpaths, roads, drainage system, water supply system and electrical system (Id. P. 17-18). 39.1. Such development plan was consistent with the 3rd Improvement Program of the National Government to be implemented by its various agencies and instrumentalities. In various presidential issuances, the National Government had clearly espoused an extensive national housing policy directed towards the improvement and rehabilitation of congested urban areas. 39. 2. The whole area of Grace Park Subdivision was one of the projects to be supervised by the plaintiff NHA under a zonal improvement program. As distinguished from other housing programs of the government, the zonal improvement project was into development or upgrading of the project area (T.S.N. of Engr. Ramon Ronquillo, 9 March 1981, pp. 53-55). This entailed the construction of footpaths, roads, drainage system, water supply system and electrical system (Ibid., p. 17-18) which would require a considerable aggregate need for open space in the congested area. Upon query of the trial court, Engr. Ramon Ronquillo testified that in totality a reasonable estimate of thirty per cent (30%) of the land area would be required for open spaces (Ibid., p. 130).

10

39.3. To implement the project, it was necessary to effect the re-blocking of some structures to conform to the physical development plan of the project. This meant the dismantling of some structures, or portions thereof for the purpose of aligning the rest of the structures (Ibid., p. 98). 39.4. The zonal improvement program was differentiated from the resettlement projects ventured into by the government in other areas. Whilst the resettlement involved movement of people from one location to another effecting thereby a dislocation of these families and their sources of livelihood (Ibid., p. 138-139), the zonal improvement program sought to remedy the social malady by merely focusing its scarce available financial and technical resources on the site to accommodate the residents in the same area where they have lived, worked, and been schooled (Ibid., p. 139-140). Moreover, concomitant to this objective was the plan of establishing a livelihood component. It basically offers financial loans to be used for construction materials to improve this lot (Ibid., p. 147). 40. There were approximately 510 families/households beneficiaries of the intended expropriation, some of whom were renters, who took second priority in the award and for whom some vacant lots are intended (Ibid., p. 106). Each household or family had an average of five (5) members (Id., p. 134). Hence, the entire project would provide shelter to approximately 2,550 individuals. The average site of individual homelots to be awarded to each family is 60 square meters (Id., p. 137). The biggest area could be one hundred seventy (170) square meters (Ibid., p. 138). In very exceptional cases an area of forty (40) square meters could be sold. The variance was explained by the fact that small structures occupied small lots (Ibid., p. 139). 41. Petitioner-appellant advertised for public bidding the construction of infrastructure (Id. p. 15). The winning bidder/contractor commenced work including three (3) streets which had already been cemented. By January 20, 1982, already 40% of the entire work had already been accomplished. Specifically, the three (3) streets included in the project had already been cemented (Id., p. 16).
71

The law is entitled "An Act to Provide for a Comprehensive and Continuing Urban Development and Housing Program, Establishing Mechanism for its Implementation, and for Other Purposes," and approved on March 24, 1992.
72

Section 10 of R.A. No. 7279 which reads:

SEC. 10. Modes of Land Acquisition.The modes of acquiring land for purposes of this Act shall include, among others, community mortgage, land swapping, land assembly or consolidation, land banking, donation to the Government, joint-venture agreement, negotiated purchase and expropriation: Provided, however, That expropriation shall be resorted only when other modes of acquisition have been exhausted: Provided, further, That where expropriation is resorted to, parcels of land owned by small property owners shall be exempted for purposes of this Act: Provided, finally, That abandoned property, as herein defined, shall be reverted and escheated to the State in a proceeding analogous to the procedure laid down in Rule 91 of the Rules of Court. For the purpose of socialized housing, government-owned and foreclosed properties shall be acquired by the local government units, or by the National Housing Authority primarily through negotiated purchase: Provided, That qualified beneficiaries who are actual occupants of the land shall be given the right of first refusal. [Underscoring ours.]
73

See Section 3 of R.A. No. 7279; City of Mandaluyong v. Aguilar, 403 Phil. 404 (2001). Coloso v. Garilao, G.R. No. 129165, October 30, 2006, 506 SCRA 25, 47.

74

75

Gallardo v. Borromeo, No. L-36007, May 25, 1988, 161 SCRA 500, 502; Co v. Court of Appeals, G.R. No. 100776, October 28, 1993, 227 SCRA 444, 448.
76

See Davao Light and Power Co., Inc. v. Opea, G.R. No. 129807, December 9, 2005, 477 SCRA 58, 83.

lawphil

2.

Republic of the Philippines SUPREME COURT Manila

11

THIRD DIVISION G.R. No. 124795 December 10, 2008

FORFOM DEVELOPMENT CORPORATION, petitioner, vs. PHILIPPINE NATIONAL RAILWAYS, respondent. DECISION CHICO-NAZARIO, J.: Before us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court which seeks to set aside the Decision1 of the Court of Appeals dated 24 April 1996. Petitioner Forfom Development Corporation (Forfom) is a domestic corporation duly organized and existing under the laws of the Philippines with principal office at Cabuyao, Laguna, while respondent Philippine National Railways (PNR) is a government corporation engaged in proprietary functions with principal office at the PNR Railway Station, C.M. Recto Avenue, Tutuban, Binondo, Manila. The facts, stripped of the non-essentials, are as follows: Forfom is the registered owner of several parcels of land in San Vicente, San Pedro, Laguna under Transfer Certificates of Title (TCT) Nos. T-34384, T-34386 and 34387, all of the Registry of Deeds of Laguna. Said parcels of land were originally registered in the name of Felix Limcaoco, predecessor-in-interest of Forfom, under Original Certificates of Title (OCT) Nos. (0-326) 0-384 and (0-328) 0-386. In a cabinet meeting held on 1 November 1972, then President Ferdinand E. Marcos approved the Presidential Commuter Service Project, more commonly known as the Carmona Project of the President. Per Resolution No. 751 dated 2 November 1972 of the PNR Board of Directors, its General Manager was authorized to implement the project. The San PedroCarmona Commuter Line Project was implemented with the installation of railroad facilities and appurtenances. During the construction of said commuter line, several properties owned by private individuals/corporations were traversed as right-of-way. Among the properties through which the commuter line passed was a 100,128 square-meter portion owned by Forfom covered by TCT Nos. T-34384, T-34386 and T-34387. On 24 August 1990, Forfom filed before the Regional Trial Court (RTC) of Binan, Laguna a complaint2 for Recovery of Posssession of Real Property and/or Damages. It alleged that PNR, with the aid of military men, and without its consent and against its will, occupied 100,128 square meters of its property located in San Pedro, Laguna and installed thereon railroad and railway facilities and appurtenances. It further alleged that PNR rented out portions of the property to squatters along the railroad tracks. Despite repeated verbal and written demands for the return of the property or for the payment of its price, PNR failed to comply. It prayed that PNR be ordered to vacate the property and to cause the eviction of all shanties and squatters that PNR had taken in as lessees, and that it be restored to the peaceful occupation and enjoyment thereof. It likewise asked that Forfom be ordered to pay (a) P1,000.00 per month per hectare from occupation of the property until the same is vacated as rentals plus interest at 24% per annum; (b) P1,600,000.00 as unrealized income from occupation of the property up to the present plus 12% interest per annum until fully paid; (c) P150,000.00 for actual damages on account of the destruction of crops and improvements on the property when the occupation of the property commenced plus 12% interest per annum until fully paid; (d) at least P100,000.00 as exemplary damages; (e) P100,000.00 plus 15% of the amount and properties to be recovered as attorney's fees; and (f) costs of the suit.3 In its Amended Answer,4 PNR alleged that, per authority granted by law (Presidential Decree No. 741), it acquired parcels of land used in the construction of the railway track to Carmona, Cavite. It, however, denied that the property acquired from Forfom was leased to tenants. It likewise denied that the acquisition of Forfom's property was made without the consent of Dr. Felix Limcaoco, the former owner of the property. It stressed that the acquisition of the properties used in the project was done through negotiations with the respective owners. It asserted that no crop was damaged when it acquired the property subject of the case. Further, it denied liability for unrealized income, exemplary damages and attorney's fees. PNR explained that former President Ferdinand E. Marcos approved what was known to be the Carmona Project -- a 5.1 kilometer railroad extension line from San Pedro, Laguna to San Jose, Carmona, Cavite to serve the squatters' resettlement area in said localities. It claimed that it negotiated with the respective owners of the affected properties and that they were paid just compensation. Dr. Felix Limcaoco, it said, was not paid because he failed to present the corresponding titles to his properties. It claimed that the right to and just compensation for the subject property was the declared fair market value at the time of the taking which was P0.60 per square meter. It disclosed that in a meeting with the representatives of Dr. Limcaoco, the price agreed upon was P1.25 per square meter, the amount the adjoining owners was paid. It prayed that the instant complaint be dismissed, and that the owner of the properties involved be compelled to accept the amount of P1.25 per square meter as price for the properties. In an Order dated 29 October 1990, the pre-trial conference on the case was set.5 On 13 March 1991, for failure of the parties to reach any agreement, pre-trial was terminated and trial of the case scheduled.6 Thereafter, trial on the merits ensued. The following witnesses testified for Forfom: (1) Leon Capati; (2) Marites Dimaculangan; (3) Marilene L. de Guzman; (4) Gavino Rosas de Claro; and (5) Jose Elazegui.

12

Mr. Leon Capati,7 employee of Forfom, testified that he knew Dr. Felix Limcaoco, Sr. because he worked for him since 1951 until his death. He knew Forfom Development Corporation to be a corporation formed by the children of Dr. Limcaoco and owner of the properties left behind by said doctor. He said he worked as overseer in Hacienda Limcaoco in San Pedro, Laguna owned by Dr. Limcaoco. Said hacienda was converted to the Olympia Complex Subdivision now owned by Forfom. Being a worker of Forfom, he disclosed that in 1972, the PNR forcibly took portions of the property of Forfom. Armed men installed railroads and even used bulldozers which caused the destruction of around eleven hectares of sugar land. Since 1972, he said PNR used the property for its benefit and even leased part of it to people living near the railroad. At that time, he claimed that the value of sugarcane was P200.00 per piko and that the plantation harvested sixty (60) tons annually worth P224,000.00. In all, from 1972 to 1985, he claimed Forfom lost P2,917,200.00 in ruined sugar, unrealized harvest, excluding unrealized harvest for nine mango trees which yielded 60 kaings per tree per harvest. Ms. Marites Dimaculangan,8 an officer of Forfom, corroborated the testimony of Mr. Leon Capati. She presented documents9 showing that Hacienda Limcaoco was previously owned by Dr. Felix Limcaoco, then the ownership was transferred to Forfom. As proof that Hacienda Limcaoco was converted into a low-cost housing subdivision known as the Olympia Complex Subdivision, she presented permits from the Human Settlements Regulatory Commission and from the Municipality of San Pedro.10 She also adduced in evidence several letters11 allegedly showing that PNR occupied the property owned by the Limcaocos. As a result, around eleven hectares of the sugar cane plantation were destroyed.12 From 1972 to 1985, she claimed that part of the property taken by PNR was leased to squatters beside the railroad tracks. She added that Forfom incurred a loss totaling P2,917,200.00. She claimed that the current price of land contiguous to the parcels taken by PNR was P1,000.00 per square meter. Ms. Marilene L. De Guzman,13 Executive Vice-President of Forfom and daughter of the Late Dr. Felix Limcaoco, corroborated the testimonies of Mr. Capati and Ms. Dimaculangan. She disclosed that his father died on 25 March 1973. She learned from her father and from Mr. Leon Capati that when the armed men took a portion of their property, the armed men did not show any court order or authority from any agency of the government. The armed men used bulldozers destroying 11 hectares of sugarcane and some mango trees. She said those taken over were used as railroad tracks and a portion beside the tracks were being leased to squatters. She revealed that the present fair market value of land at Olympia Complex is P1,400.00 per square meter.14 If the land is not developed, same can be sold for P800.00 per square meter. She said from the time their property was taken over by PNR, her family has been writing to PNR regarding compensation for their land.15 Ms. De Guzman said the property was still in the name of Dr. Felix Limcaoco, Sr. and Mrs. Olympia Limcaoco when the PNR took over a portion of their properties. She said she was not informed by Mr. Capati that the PNR took the said property over pursuant to a Presidential Mandate in order to provide transportation for relocated squatters. She explained that her father and Mr. Capati were not advised to harvest their crops and were surprised by the taking over of the land. Mr. Gavino Rosas de Claro,16 Land Register Examiner of the Register of Deeds of Calamba, Laguna, testified as representative of the Register of Deeds. He brought in Court the originals of TCT Nos. T-3438417 and T-34386,18 both in the name of Forfom Development Corporation and OCT Nos. (O-326) O-38419 and (O-328) O-386, both in the name of Dr. Felix Limcaoco, Sr.20 Thereafter, photocopies thereof were compared with the originals which were found to be faithful reproductions of the same. Jose Elazegui,21 Supervisor, Southern Tagalog Facoma, Inc. was presented to show the production of sugar and molasses on the property of Forfom. He presented duplicate original copies of Tuos ng inaning Tubo for the years 1984-1985, 1985-1986, 1986-1987 and 1987-1988.22 The documents showed the production (average yield per area per picul) in other properties owned by Forfom other than the properties subject matter of this case. For the defendant, Mrs. Edna Ramos, Department Manager of the Real Estate Department of the PNR, took the stand.23 She testified that she was familiar with the acquisition by the PNR of the right of way for the San Pedro-Carmona Commuter Line. It was acquired and established by Presidential Mandate and pursuant to the authority of the PNR to expropriate under its charter (Presidential Decree No. 741).24 She explained that President Ferdinand E. Marcos authorized the PNR to acquire said right of way in a Cabinet Meeting on 1 November 1972 as evidenced by an excerpt of the minutes of the meeting of the PNR Board of Directors on Resolution No. 751.25 The right of way was acquired to provide a cheap, efficient and safe means of transportation to the squatters who were relocated in Cavite. The commuter line, she said, was primarily for service rather than profit. As shown by the letter26 dated 30 April 1974 of Nicanor T. Jimenez, former General Manager of the PNR, to Mrs. Olympia Hemedes Vda. de Limcaoco, the acquisition of the right of way was with the knowledge and consent of Dr. Felix Limcaoco, Sr. Mrs. Ramos disclosed that the total area acquired by the PNR for the San Pedro-Carmona Commuter Line was 15.7446 hectares or sixteen (16) lots in all owned by seven (7) private landowners and three (3) corporations. Among the private landowners were Isabel Oliver, Leoncia Blanco, Catalina Sanchez, Tomas Oliver, Alejandro Oliver and Antonio Sibulo. Per record of PNR, they were paid P1.25 per square meter for their lands. They executed Absolute Deeds of Sale in favor of the PNR, as a result of which, titles to the lands were transferred to PNR.27 The remaining 9 lots belonging to the three private corporations - Forfom Development Corporation, Alviar Development Manufacturing & Trading Supply Corp. and Life Realty Development Corporation - were not paid for because these corporations were not able to present their respective titles, which had been used as loan collaterals in the Philippine National Bank and the Government Service Insurance System.28 The unit price per square meter, which the negotiating panel of the PNR and the representatives of the three corporations was considering then, was P1.25. In a letter dated 3 October 1975, Mr. Felix Limcaoco, Jr. of Forfom was asking for P12.00 per square meter for their land and P150,000.00 for damaged sugar crops and mango trees.29 She likewise said she had the minutes of the conference between Mr. Limcaoco and the PNR Chief Construction Engineer held at the PNR General Manager's Office on 24 July 1979.30 Mrs. Ramos clarified that as a matter of policy, PNR employees and other persons were not allowed to settle on the PNR's right of way. Squatting along the right of way had never been encouraged. To prevent its proliferation, special contracts were entered into with selected parties under strict conditions to vacate the property leased upon notice. She explained that the leasing of PNR's right of way was an incidental power and was in response to the government's social housing project. In its decision dated 29 October 1992, the trial court ruled generally in favor of plaintiff, the dispositive portion reading: WHEREFORE, premises considered, judgment is hereby rendered in favor of plaintiff and against defendant ordering the latter to pay the former the following: 1. Just compensation of the subject real properties consisting of 100,128 square meters and covered by TCT Nos. T-34387, T-34384 and T-34386 at

13

P10.00 per square meter, with legal interest from the time of actual taking of plaintiff's real properties until payment is made by the defendant; 2. The amount of P4,480,000.00 as unearned income of plaintiff from 1972 up to the current year, and thereafter, the amount of P224,000 yearly, with legal interest until payment is made; 3. Actual damages in the amount of P150,000 corresponding to sugarcane crops and mango trees destroyed or damaged as a result of the unlawful taking of plaintiff's real properties, with legal interest until payment is made; 4. The amount of P100,000 as and for attorney's fees; 5. The amount of P150,000 for litigation expenses plus the costs of this suit. Plaintiff's claim for recovery of possession and the other prayers in the complaint are hereby dismissed for want of merit.31 The trial court found that the properties of Forfom were taken by PNR without due process of law and without just compensation. Although the power of eminent domain was not exercised in accordance with law, and PNR occupied petitioner's properties without previous condemnation proceedings and payment of just compensation, the RTC ruled that, by its acquiescence, Forfom was estopped from recovering the properties subject of this case. As to its right to compensation and damages, it said that the same could not be denied. The trial court declared that P10.00 per square meter was the fair and equitable market value of the real properties at the time of the taking thereof. Not contented with the decision, both parties appealed to the Court of Appeals by filing their respective Notices of Appeal. 32 PNR questioned the trial court's ruling fixing the just compensation at P10.00 per square meter and not the declared value of P0.60 per square meter or the fair market value of P1.25 paid to an adjacent owner. It likewise questioned the award of actual damages and unearned income to Forfom. On 24 April 1996, the appellate court disposed of the case as follows: WHEEFORE, the decision appealed from is hereby AFFIRMED insofar as (1) it denies plaintiff's claim for recovery of possession and (2) it awards just compensation at the rate of P10.00 per square meter which defendant must pay to plaintiff, but with legal rate of interest thereon hereby specifically fixed at six (6) percent per annum starting from January of 1973 until full payment is made. However, the appealed decision is MODIFIED in the sense that plaintiff's claim for damages is DENIED for lack of merit. No pronouncement as to costs.33 Except for the deletion of the award of damages, attorney's fees and litigation expenses, the appellate court agreed the with trial court. We quote: There is no dispute that defendant neither commenced an expropriation proceedings nor paid just compensation prior to its occupation and construction of railroad lines on the subject property. Nevertheless, plaintiff's prayer to recover the property cannot be granted. Immediately after the occupation, or within a reasonable time thereafter, there is no showing that the same was opposed or questioned by plaintiff or its representatives on the ground that defendant never filed an expropriation proceedings and that no just compensation was ever paid. Neither is there a showing that plaintiff sought to recover the property because the taking was done forcibly with the aid of armed men. Instead, and this is borne out by certain communications between the parties through their respective officers or representatives, what plaintiff actually did was to negotiate with defendant for the purpose of fixing the amount which the latter should pay as just compensation and, if there be any, damages. x x x. Clearly, a continuing negotiation between the parties took place for the purpose only of fixing the amount of just compensation and not because plaintiff wanted to recover the subject property. Thus, the failure of defendant to first file an expropriation proceedings and pay just compensation is now beside the point. And even if the contention of plaintiff that defendant used force is true, the former can no longer complain at this time. What controls now is the fact that by its own act of negotiating with defendant for the payment of just compensation, plaintiff had in effect made representations that it acquiesced to the taking of its property by defendant. We therefore agree with the lower court that plaintiff, by its acquiescence, waived its right, and is thus estopped, from recovering the subject property or from challenging any supposed irregularity in its acquisition. Plaintiff's right to recover just compensation, however, remains. On this matter, we agree with the P10.00 per square meter valuation fixed by the trial court x x With the long delay in the payment of just compensation however, defendant should pay interest thereon at the legal rate of six (6) percent per annum from the time of occupation until payment is made. x x x.34 Still unsatisfied with the decision, Forfom filed the instant petition for review on certiorari raising the following issues: A. THE HONORABLE COURT OF APPEALS ERRED IN HOLDING THAT PETITIONER CANNOT RECOVER POSSESSION OF ITS LAND DESPITE THE ADMISSION THAT IT WAS FORCIBLY TAKEN (DURING THE MARTIAL LAW ERA) WITHOUT ANY EXPROPRIATION PROCEEDING OR PAYMENT OF COMPENSATION SIMPLY BECAUSE

14

PETITIONER DID NOT OPPOSE THE ARMED AND FORCIBLE TAKING THEREOF: B. THE HONORABLE COURT OF APPEALS EMPLOYED DOUBLE STANDARD OF JUSTICE IN ADMITTING HEARSAY EVIDENCE OF PNR YET REJECTING THAT OF PETITIONER WHICH IS PROPERLY IDENTIFIED WITH ABUNDANT CROSS EXAMINATION CONDUCTED ON THE BASIS OF PETITIONER'S REJECTED EVIDENCE: C. THE HONORABLE COURT OF APPEALS ERRED GRIEVOUSLY IN HOLDING THAT IN THIS ACTION "THE FAILURE OF DEFENDANT TO FIRST FILE AN EXPROPRIATION PROCEEDINGS AND PAY JUST COMPENSATION (FOR THE PROPERTY OF PETITIONER FORCIBLY TAKEN BY PRIVATE RESPONDENT) IS (NOW) BESIDE THE POINT." D. THE HONORABLE COURT OF APPEALS ERRED IN AGREEING WITH THE RTC IN FIXING THE COMPENSATION FOR THE LAND FORCIBLY TAKEN BY PNR AT A RIDICULOUS, OUTRAGEOUS, AND ABSURD PRICE OF P10.00 PER SQUARE METER DESPITE THE EVIDENCE SHOWING THAT THE PRICE OF LAND IN THE ADJACENT AND SURROUNDING AREAS IS MORE THAN P1,500.00 PER SQUARE METER: E. THE HONORABLE COURT OF APPEALS ERRED IN IGNORING THE EVIDENCE ESTABLISHING THE RIGHT OF THE PETITIONER TO BE AWARDED ACTUAL OR COMPENSATORY DAMAGES, ATTORNEY'S FEES, AND UNREALIZED INCOME: F. THE HONORABLE COURT OF APPEALS ERRED IN AND ABUSED ITS DISCRETION IN ADOPTING DOUBLE STANDARD IN ITS EVALUATION OF THE EVIDENCE AND IN ADMITTING PNR's PATENTLY HEARSAY EVIDENCE WHILE REJECTING PETITIONER'S RELEVANT - MATERIAL AND ADMISSIBLE EVIDENCE: G. THE HONORABLE COURT OF APPEALS DEVIATED FROM ESTABLISHED JURISPRUDENCE IN UNJUSTIFIABLY IGNORING AND SETTING ASIDE THE FINDINGS OF FACTS OF THE TRIAL COURT THAT ARE IN FACT SUPPORTED BY ABUNDANT EVIDENCE: H. THE HONORABLE COURT OF APPEALS APPARENTLY SUPPRESSED THE EVIDENCE THAT PRIVATE RESPONDENT PNR APART FROM FORCIBLY TAKING THE LAND OF PETITIONER WITH THE EMPLOYMENT OF ARMED MEN, RENTED OUT PORTIONS OF SAID LAND TO ITS TENANTS WHO PAID HEFTY RENTALS FOR THE USE OF THE SAME AS RESIDENTIAL LOTS (AND NOT FOR PUBLIC PURPOSES).35 On the other hand, PNR accepted the decision of the Court of Appeals and no longer appealed. The primary question to be resolved is: Can petitioner Forfom recover possession of its property because respondent PNR failed to file any expropriation case and to pay just compensation? The power of eminent domain is an inherent and indispensable power of the State. Being inherent, the power need not be specifically conferred on the government by the Constitution.36 Section 9, Article III states that private property shall not be taken for public use without just compensation. The constitutional restraints are public use and just compensation.37 The fundamental power of eminent domain is exercised by the Legislature. It may be delegated by Congress to the local governments, other public entities and public utilities.38 In the case at bar, PNR, under its charter,39 has the power of expropriation. A number of circumstances must be present in the taking of property for purposes of eminent domain: (1) the expropriator must enter a private property; (2) the entrance into private property must be for more than a momentary period; (3) the entry into the property should be under warrant or color of legal authority; (4) the property must be devoted to a public purpose or otherwise informally, appropriately or injuriously affected; and (5) the utilization of the property for public use must be in such a way as to oust the owner and deprive him of all beneficial enjoyment of the property.40 In the case at bar, the expropriator (PNR) entered the property of Forfom, a private land. The entrance into Forfom's property was permanent, not for a fleeting or brief period. PNR has been in control, possession and enjoyment of the subject land since December 1972 or January 1973. PNR's entry into the property of Forfom was with the approval of then President Marcos and with the authorization of the PNR's Board of Directors. The property of Forfom measuring around eleven hectares was devoted to public use - railroad tracks, facilities and appurtenances for use of the Carmona Commuter Service. With the entrance of PNR into the property, Forfom was deprived of material and beneficial use and enjoyment of the property. It is clear from the foregoing that there was a taking of property within the constitutional sense. Forfom argues that the property taken from it should be returned because there was neither expropriation case filed by PNR nor just compensation paid for the same. It can be gathered from the records that Forfom accepted the fact of the taking of its land when it negotiated with PNR for just compensation, knowing fully well that there was no expropriation case filed at all. Forfom's inaction for almost eighteen (18) years to question the absence of expropriation proceedings and its discussions with PNR as to how much petitioner shall be paid for its land preclude it from questioning the PNR's power to expropriate or the public purpose for which the power was exercised. In other words, it has waived its right and is estopped from assailing the takeover of its land on the ground that there was no case for expropriation that was commenced by PNR. In Manila Railroad Co. v. Paredes,41 the first case in this jurisdiction in which there was an attempt to compel a public service corporation, endowed with the power of eminent domain, to vacate the property it had occupied without first acquiring title thereto by amicable purchase or expropriation proceedings, we said:

15

x x x whether the railroad company has the capacity to acquire the land in dispute by virtue of its delegated power of eminent domain, and, if so, whether the company occupied the land with the express or implied consent or acquiescence of the owner. If these questions of fact be decided in the affirmative, it is uniformly held that an action of ejectment or trespass or injunction will not lie against the railroad company, but only an action for damages, that is, recovery of the value of the land taken, and the consequential damages, if any. The primary reason for thus denying to the owner the remedies usually afforded to him against usurpers is the irremedial injury which would result to the railroad company and to the public in general. It will readily be seen that the interruption of the transportation service at any point on the right of way impedes the entire service of the company and causes loss and inconvenience to all passengers and shippers using the line. Under these circumstances, public policy, if not public necessity, demands that the owner of the land be denied the ordinarily remedies of ejectment and injunction. The fact that the railroad company has the capacity to eventually acquire the land by expropriation proceedings undoubtedly assists in coming to the conclusion that the property owner has no right to the remedies of ejectment or injunction. There is also something akin to equitable estoppel in the conduct of one who stands idly by and watches the construction of the railroad without protest. x x x. But the real strength of the rule lies in the fact that it is against public policy to permit a property owner, under such circumstances, to interfere with the service rendered to the public by the railroad company. x x x. (I)f a landowner, knowing that a railroad company has entered upon his land and is engaged in constructing its road without having complied with a statute requiring either payment by agreement or proceedings to condemn, remains inactive and permits it to go on and expend large sums in the work, he is estopped from maintaining either trespass or ejectment for the entry, and will be regarded as having acquiesced therein, and will be restricted to a suit for damages. Further, in De Ynchausti v. Manila Electric Railroad & Light Co.,42 we ruled: The owner of land, who stands by, without objection, and sees a public railroad constructed over it, can not, after the road is completed, or large expenditures have been made thereon upon the faith of his apparent acquiescence, reclaim the land, or enjoin its use by the railroad company. In such a case there can only remain to the owner a right of compensation. One who permits a railroad company to occupy and use his land and construct its roads thereon without remonstrance or complaint, cannot afterwards reclaim it free from the servitude he has permitted to be imposed upon it. His acquiescence in the company's taking possession and constructing its works under circumstances which made imperative his resistance, if he ever intended to set up illegality, will be considered a waiver. But while this presumed waiver is a bar to his action to dispossess the company, he is not deprived of his action for damages for the value of the land, of for injuries done him by the construction or operation of the road. We conclude that x x x the complaint in this action praying for possession and for damages for the alleged unlawful detention of the land in question, should be dismissed x x x but that such dismissal x x x should be without prejudice to the right of the plaintiff to institute the appropriate proceedings to recover the value of the lands actually taken, or to compel the railroad corporation to take the necessary steps to secure the condemnation of the land and to pay the amount of the compensation and damages assessed in the condemnation proceedings. In Ansaldo v. Tantuico, Jr.,43 a case involving the takeover by the Government of two private lots to be used for the widening of a road without the benefit of an action for expropriation or agreement with its owners, we held that the owners therein, having been silent for more than two decades, were deemed to have consented to such taking -although they knew that there had been no expropriation case commenced -- and therefore had no reason to impugn the existence of the power to expropriate or the public purpose for which that power had been exercised. In said case, we directed the expropriator to forthwith institute the appropriate expropriation action over the land, so that just compensation due the owners may be determined in accordance with the Rules of Court. From the afore-cited cases, it is clear that recovery of possession of the property by the landowner can no longer be allowed on the grounds of estoppel and, more importantly, of public policy which imposes upon the public utility the obligation to continue its services to the public. The non-filing of the case for expropriation will not necessarily lead to the return of the property to the landowner. What is left to the landowner is the right of compensation. Forfom argues that the recovery of its property is justified because PNR failed to pay just compensation from the time its property was taken. We do not agree. It is settled that nonpayment of just compensation does not entitle the private landowners to recover possession of their expropriated lot.44 Forfom contends that since there is enormous proof that portions of the property taken by PNR were being leased to third parties there was enough justification for the Court of Appeals to order the return to petitioner of the leased portions as well as the rents received therefrom. We find such contention to be untenable. As ruled above, Forfom's inaction on and acquiescence to the taking of its land without any expropriation case being filed, and its continued negotiation with PNR on just compensation for the land, prevent him from raising any issues regarding the power and right of the PNR to expropriate and the public purpose for which the right was exercised. The only issue that remains is just compensation. Having no right to further question PNR's act of taking over and the corresponding public purpose of the condemnation, Forfom cannot now object to PNR's lease of portions of the land to third parties. The leasing out of portions of the property is already a matter between PNR and third persons in which Forfom can no longer participate. The same no longer has any bearing on the issue of just compensation. Forfom further avers that the leasing out of portions of the property to third persons is beyond the scope of public use and thus should be returned to it. We do not agree. The publicuse requisite for the valid exercise of the power of eminent domain is a flexible and evolving concept influenced by changing conditions. At present, it may not be amiss to state that whatever is beneficially employed for the general welfare satisfies the requirement of public use.45 The term "public use" has now been held to be synonymous with "public interest," "public benefit," "public welfare," and "public convenience."46 It includes the broader notion of indirect public benefit or advantage.47 Whatever may be beneficially employed for the general welfare satisfies the requirement of public use.48 In the instant case, Mrs. Ramos of the PNR explains that the leasing of PNR's right of way is an incidental power and is in response to the government's social housing project. She said

16

that to prevent the proliferation of squatting along the right of way, special contracts were entered into with selected parties under strict conditions to vacate the property leased upon notice. To the court, such purpose is indeed public, for it addresses the shortage in housing, which is a matter of concern for the state, as it directly affects public health, safety, environment and the general welfare. Forfom claims it was denied due process when its property was forcibly taken without due compensation for it. Forfom is not being denied due process. It has been given its day in court. The fact that its cause is being heard by this Court is evidence that it is not being denied due process. We now go to the issue of just compensation. Under Section 5 of the 1997 Rules of Civil Procedure, the court shall appoint not more than three competent and disinterested persons as commissioners to ascertain and report to the court the just compensation for the property. Though the ascertainment of just compensation is a judicial prerogative, 49 the appointment of commissioners to ascertain just compensation for the property sought to be taken is a mandatory requirement in expropriation cases. While it is true that the findings of commissioners may be disregarded and the trial court may substitute its own estimate of the value, it may only do so for valid reasons; that is, where the commissioners have applied illegal principles to the evidence submitted to them, where they have disregarded a clear preponderance of evidence, or where the amount allowed is either grossly inadequate or excessive. Thus, "trial with the aid of the commissioners is a substantial right that may not be done away with capriciously or for no reason at all." 50 In the case before us, the trial court determined just compensation, but not in an expropriation case. Moreover, there was no appointment of commissioners as mandated by the rules. The appointment of commissioners is one of the steps involved in expropriation proceedings. What the judge did in this case was contrary to what the rules prescribe. The judge should not have made a determination of just compensation without first having appointed the required commissioners who would initially ascertain and report the just compensation for the property involved. This being the case, we find the valuation made by the trial court to be ineffectual, not having been made in accordance with the procedure provided for by the rules. The next issue to be resolved is the time when just compensation should be fixed. Is it at the time of the taking or, as Forfom maintains, at the time when the price is actually paid? Where actual taking was made without the benefit of expropriation proceedings, and the owner sought recovery of the possession of the property prior to the filing of expropriation proceedings, the Court has invariably ruled that it is the value of the property at the time of taking that is controlling for purposes of compensation.51 In the case at bar, the just compensation should be reckoned from the time of taking which is January 1973. The determination thereof shall be made in the expropriation case to be filed without delay by the PNR after the appointment of commissioners as required by the rules. Admittedly, the PNR's occupation of Forfom's property for almost eighteen (18) years entitles the latter to payment of interest at the legal rate of six (6%) percent on the value of the land at the time of taking until full payment is made by the PNR.52 For almost 18 years, the PNR has enjoyed possession of the land in question without the benefit of expropriation proceedings. It is apparent from its actuations that it has no intention of filing any expropriation case in order to formally place the subject land in its name. All these years, it has given Forfom the runaround, failing to pay the just compensation it rightly deserves. PNR's uncaring and indifferent posture must be corrected with the awarding of exemplary damages, attorney's fees and expenses of litigation. However, since Forfom no longer appealed the deletion by both lower courts of said prayer for exemplary damages, the same cannot be granted. As to attorney's fees and expenses of litigation, we find the award thereof to be just and equitable. The amounts of P100,000.00 as attorney's fees and P50,000.00 as litigation expenses are reasonable under the premises. As explained above, the prayer for the return of the leased portions, together with the rental received therefrom, is denied. Unearned income for years after the takeover of the land is likewise denied. Having turned over the property to PNR, Forfom has no more right to receive any income, if there be any, derived from the use of the property which is already under the control and possession of PNR. As to actual damages corresponding to the sugarcane and mango trees that were allegedly destroyed when PNR entered and took possession of the subject land, we find that the same, being a question of fact, is better left to be determined by the expropriation court where the PNR will be filing the expropriation case. Evidence for such claim may be introduced before the condemnation proceedings.53 WHEREFORE, the instant petition is PARTIALLY DENIED insofar as it denies Forfom Development Corporation's prayer for recovery of possession (in whole or in part) of the subject land, unearned income, and rentals. The petition is PARTIALLY GRANTED in that attorney's fees and litigation expenses in the amounts of P100,000.00 and P50,000.00, respectively, are awarded. The Philippine National Railways is DIRECTED to forthwith institute the appropriate expropriation action over the land in question, so that just compensation due to its owner may be determined in accordance with the Rules of Court, with interest at the legal rate of six (6%) percent per annum from the time of taking until full payment is made. As to the claim for the alleged damaged crops, evidence of the same, if any, may be presented before the expropriation court. No costs. SO ORDERED. MINITA V. CHICO-NAZARIO Associate Justice

17

WE CONCUR:

CONSUELO YNARES-SANTIAGO Associate Justice Chairperson MA. ALICIA AUSTRIA-MARTINEZ Associate Justice RUBEN T. REYES Associate Justice ANTONIO EDUARDO B. NACHURA Associate Justice

ATTESTATION I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court's Division. CONSUELO YNARES-SANTIAGO Associate Justice Chairperson - Third Division

CERTIFICATION Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson's Attestation, I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court's Division. REYNATO S. PUNO Chief Justice

3.
6 11 2010 Poor

Association of Small Landowners vs Secretary of Agrarian Reform

Equal Protection These are 3 cases consolidated questioning the constitutionality of the Agrarian Reform Act. Article XIII on Social Justice and Human Rights includes a call for the adoption by the State of an agrarian reform program. The State shall, by law, undertake an agrarian reform program founded on the right of farmers and regular farmworkers, who are landless, to own directly or collectively the lands they till or, in the case of other farmworkers, to receive a just share of the fruits thereof. RA 3844, Agricultural Land Reform Code, had already been enacted by Congress on August 8, 1963. This was substantially superseded almost a decade later by PD 27, which was promulgated on Oct 21, 1972, along with martial law, to provide for the compulsory acquisition of private lands for distribution among tenant-farmers and to specify maximum retention limits for landowners. On July 17, 1987, Cory issued EO 228, declaring full land ownership in favor of the beneficiaries of PD 27 and providing for the valuation of still unvalued lands covered by the decree as well as the manner of their payment. This was followed on July 22, 1987 by PP 131, instituting a comprehensive agrarian reform program (CARP), and EO 229, providing the mechanics for its implementation. Afterwhich is the enactment of RA 6657, Comprehensive Agrarian Reform Law of 1988, which Cory signed on June 10. This law, while considerably changing the earlier mentioned enactments, nevertheless gives them suppletory effect insofar as they are not inconsistent with its provisions.

18

In considering the rentals as advance payment on the land, the executive order also deprives the petitioners of their property rights as protected by due process. The equal protection clause is also violated because the order places the burden of solving the agrarian problems on the owners only of agricultural lands. No similar obligation is imposed on the owners of other properties. The petitioners maintain that in declaring the beneficiaries under PD 27 to be the owners of the lands occupied by them, EO 228 ignored judicial prerogatives and so violated due process. Worse, the measure would not solve the agrarian problem because even the small farmers are deprived of their lands and the retention rights guaranteed by the Constitution. In his comment the Sol-Gen asserted that the alleged violation of the equal protection clause, the sugar planters have failed to show that they belong to a different class and should be differently treated. The Comment also suggests the possibility of Congress first distributing public agricultural lands and scheduling the expropriation of private agricultural lands later. From this viewpoint, the petition for prohibition would be premature. ISSUE: Whether or not there was a violation of the equal protection clause. HELD: The SC ruled affirming the Sol-Gen. The argument of the small farmers that they have been denied equal protection because of the absence of retention limits has also become academic under Sec 6 of RA 6657. Significantly, they too have not questioned the area of such limits. There is also the complaint that they should not be made to share the burden of agrarian reform, an objection also made by the sugar planters on the ground that they belong to a particular class with particular interests of their own. However, no evidence has been submitted to the Court that the requisites of a valid classification have been violated. Classification has been defined as the grouping of persons or things similar to each other in certain particulars and different from each other in these same particulars. To be valid, it must conform to the following requirements: (1) it must be based on substantial distinctions; (2) it must be germane to the purposes of the law; (3) it must not be limited to existing conditions only; and (4) it must apply equally to all the members of the class. The Court finds that all these requisites have been met by the measures here challenged as arbitrary and discriminatory. Equal protection simply means that all persons or things similarly situated must be treated alike both as to the rights conferred and the liabilities imposed. The petitioners have not shown that they belong to a different class and entitled to a different treatment. The argument that not only landowners but also owners of other properties must be made to share the burden of implementing land reform must be rejected. There is a substantial distinction between these two classes of owners that is clearly visible except to those who will not see. There is no need to elaborate on this matter. In any event, the Congress is allowed a wide leeway in providing for a valid classification. Its decision is accorded recognition and respect by the courts of justice except only where its discretion is abused to the detriment of the Bill of Rights.

4.

ROXAS & co. vs CA

321 scra 106 FACTS: This case involves three (3) haciendas in Nasugbu, Batangas owned by petitioner and the validity of the acquisition of these haciendas by the government under Republic Act No. 6657, the Comprehensive Agrarian Reform Law of 1988.

Petitioner Roxas & Co. is a domestic corporation and is the registered owner of three haciendas, namely, Haciendas Palico, Banilad and Caylaway, all located in the Municipality of Nasugbu, Batangas. On July 27, 1987, the Congress of the Philippines formally convened and took over legislative power from the President.2 This Congress passed Republic Act No. 6657, the Comprehensive Agrarian Reform Law (CARL) of 1988. The Act was signed by the President on June 10, 1988 and took effect on June 15, 1988. Before the law's effectivity, on May 6, 1988, petitioner filed with respondent DAR a voluntary offer to sell Hacienda Caylaway pursuant to the provisions of E.O. No. 229. Haciendas Palico and Banilad were later placed under compulsory acquisition by

19

respondent DAR in accordance with the CARL. , petitioner applied with the DAR for conversion of Haciendas Palico and Banilad from agricultural to non-agricultural lands under the provisions of the CARL.13 On July 14, 1993, petitioner sent a letter to the DAR Regional Director reiterating its request for conversion of the two haciendas.14

Despite petitioner's application for conversion, respondent DAR proceeded with the acquisition of the two Haciendas. The LBP trust accounts as compensation for Hacienda Palico were replaced by respondent DAR with cash and LBP bonds.15 On October 22, 1993, from the mother title of TCT No. 985 of the Hacienda, respondent DAR registered Certificate of Land Ownership Award (CLOA) No. 6654. On October 30, 1993, CLOA's were distributed to farmer beneficiaries.16

On August 6, 1992, petitioner, through its President, Eduardo J. Roxas, sent a letter to the Secretary of respondent DAR withdrawing its VOS (voluntary offer to sell) of Hacienda Caylaway. The Sangguniang Bayan of Nasugbu, Batangas allegedly authorized the reclassification of Hacienda Caylaway from agricultural to non-agricultural. As a result, petitioner informed respondent DAR that it was applying for conversion of Hacienda Caylaway from agricultural to other uses.34

In a letter dated September 28, 1992, respondent DAR Secretary informed petitioner that a reclassification of the land would not exempt it from agrarian reform. Respondent Secretary also denied petitioner's withdrawal of the VOS on the ground that withdrawal could only be based on specific grounds such as unsuitability of the soil for agriculture, or if the slope of the land is over 18 degrees and that the land is undeveloped.35

Despite the denial of the Voluntary Offer to sell withdrawal of Hacienda Caylaway, on May 11, 1993, petitioner filed its application for conversion of both Haciendas Palico and Banilad. , through its President, Eduardo Roxas, reiterated its request to withdraw the VOS over Hacienda Caylaway in light of the following:

1) Certification issued by Conrado I. Gonzales, Officer-in-Charge, Department of Agriculture, Region 4, 4th Floor, ATI (BA) Bldg., Diliman, Quezon City dated March 1, 1993 stating that the lands subject of referenced titles "are not feasible and economically sound for further agricultural development.

2) Resolution No. 19 of the Sangguniang Bayan of Nasugbu, Batangas approving the Zoning Ordinance reclassifying areas covered by the referenced titles to non-agricultural which was enacted after extensive consultation with government agencies, including [the Department of Agrarian Reform], and the requisite public hearings. 3) Resolution No. 106 of the Sangguniang Panlalawigan of Batangas dated March 8, 1993 approving the Zoning Ordinance enacted by the Municipality of Nasugbu.

4) Letter dated December 15, 1992 issued by Reynaldo U. Garcia of the Municipal Planning & Development, Coordinator and Deputized Zoning Administrator addressed to Mrs. Alicia P. Logarta advising that the Municipality of Nasugbu, Batangas has no objection to the conversion of the lands subject of referenced titles to non-agricultural.37

Petitioner alleged that the Municipality of Nasugbu, where the haciendas are located, had been declared a tourist zone, that the land is not suitable for agricultural production, and that the Sangguniang Bayan of Nasugbu had reclassified the land to non-agricultural.. Petitioner urges the Court to take cognizance of the conversion proceedings and rule accordingly ISSUE: WON the courts are in a better position to resolve petitioner's application for conversion of land. HELD : NO.91 Respondent DAR is in a better position to resolve petitioner's application for conversion, being primarily the agency

20

possessing the necessary expertise on the matter

The DAR's mandate over applications for conversion was first laid down in Section 4 (j) and Section 5 (l) of Executive Order No. 129- A, Series of 1987 and reiterated in the CARL and Memorandum Circular No. 54, Series of 1993 of the Office of the President. The DAR's jurisdiction over applications for conversion is provided as follows: A. The Department of Agrarian Reform (DAR) is mandated to "approve or disapprove applications for conversion, restructuring or readjustment of agricultural lands into non-agricultural uses," pursuant to Section 4 (j) of Executive Order No. 129-A, Series of 1987. B. Sec. 5 (l) of E.O. 129-A, Series of 1987, vests in the DAR, exclusive authority to approve or disapprove applications for conversion of agricultural lands for residential, commercial, industrial and other land uses. C. Sec. 65 of R.A. No. 6657, otherwise known as the Comprehensive Agrarian Reform Law of 1988, likewise empowers the DAR to authorize under certain conditions, the conversion of agricultural lands.

D. Sec. 4 of Memorandum Circular No. 54, Series of 1993 of the Office of the President, provides that "action on applications for land use conversion on individual landholdings shall remain as the responsibility of the DAR, which shall utilize as its primary reference, documents on the comprehensive land use plans and accompanying ordinances passed upon and approved by the local government units concerned, together with the National Land Use Policy, pursuant to R.A. No. 6657 and E.O. No. 129-A.87

Applications for conversion were initially governed by DAR A.O. No. 1, Series of 1990 entitled "Revised Rules and Regulations Governing Conversion of Private Agricultural Lands and Non-Agricultural Uses," and DAR A.O. No. 2, Series of 1990 entitled "Rules of Procedure Governing the Processing and Approval of Applications for Land Use Conversion." These A.O.'s and other implementing guidelines, including Presidential issuances and national policies related to land use conversion have been consolidated in DAR A.O. No. 07, Series of 1997. Under this recent issuance, the guiding principle in land use conversion is:

to preserve prime agricultural lands for food production while, at the same time, recognizing the need of the other sectors of society (housing, industry and commerce) for land, when coinciding with the objectives of the Comprehensive Agrarian Reform Law to promote social justice, industrialization and the optimum use of land as a national resource for public welfare.88 "Land Use" refers to the manner of utilization of land, including its allocation, development and management. "Land Use Conversion"

refers to the act or process of changing the current use of a piece of agricultural land into some other use as approved by the DAR.89 The conversion of agricultural land to uses other than agricultural requires field investigation and conferences with the occupants of the land. They involve factual findings and highly technical matters within the special training and expertise of the DAR. DAR A.O. No. 7, Series of 1997 lays down with specificity how the DAR must go about its task. This time, the field investigation is not conducted by the MARO but by a special task force, known as the Center for Land Use Policy Planning and Implementation (CLUPPI-DAR Central Office). The procedure is that once an application for conversion is filed, the CLUPPI prepares the Notice of Posting. The MARO only posts the notice and thereafter issues a certificate to the fact of posting. The CLUPPI conducts the field investigation and dialogues with the applicants and the farmer beneficiaries to ascertain the information necessary for the processing of the application. The Chairman of the CLUPPI deliberates on the merits of the investigation report and recommends the appropriate action. This recommendation is transmitted to the Regional Director, thru the Undersecretary, or Secretary of Agrarian Reform. Applications involving more than fifty hectares are approved or disapproved by the Secretary. The procedure does not end with the Secretary, however. The Order provides that the decision of the Secretary may be appealed to the Office of the President or the Court of Appeals, as the case may be,:

21

Appeal from the decision of the Undersecretary shall be made to the Secretary, and from the Secretary to the Office of the President or the Court of Appeals as the case may be. The mode of appeal/motion for reconsideration, and the appeal fee, from Undersecretary to the Office of the Secretary shall be the same as that of the Regional Director to the Office of the Secretary.90

Indeed, the doctrine of primary jurisdiction does not warrant a court to arrogate unto itself authority to resolve a controversy the jurisdiction over which is initially lodged with an administrative body of special competence.91 Respondent DAR is in a better position to resolve petitioner's application for conversion, being primarily the agency possessing the necessary expertise on the matter. The power to determine whether Haciendas Palico, Banilad and Caylaway are non-agricultural, hence, exempt from the coverage of the CARL lies with the DAR, not with this Court. ------NAKAKA IRITA TO PROMISE ------HASH ROXAS VS CA

lawphil

5.

Republic of the Philippines SUPREME COURT Manila SECOND DIVISION

G.R. No. 146572

January 14, 2005

CIRINEO BOWLING PLAZA, INC., petitioner, vs. GERRY SENSING, BELEN FERNANDEZ, MIRASOL DIAZ, MARGARITA ABRIL, DARIO BENITEZ, MANUEL BENITEZ, RONILLO TANDOC, EDGAR DIZON, JOVELYN QUINTO, KAREN REMORAN, JENIFFER RINGOR, DEPARTMENT OF LABOR AND EMPLOYMENT and COURT of APPEALS, respondents. DECISION AUSTRIA-MARTINEZ, J.: Before us is a special civil action for certiorari filed by petitioner assailing the Resolution1 dated August 31, 2000 of the Court of Appeals (CA) which dismissed petitioners petition for certiorari; and the Resolution2 dated November 10, 2000 which denied petitioners motion for reconsideration. The antecedent facts are as follows: On November 27, 1995, Eligio Paolo, Jr., an employee of petitioner, filed a letter complaint with the Department of Labor and Employment (DOLE for short), Dagupan District Office, Dagupan City, requesting for the inspection/investigation of petitioner for various labor law violations like underpayment of wages, 13th month pay, non-payment of rest day pay, overtime pay, holiday pay and service incentive leave pay.3 Pursuant to the visitorial and enforcement powers of the Secretary of Labor and Employment, his duly authorized representative under Article 128 of the Labor Code, as amended, conducted inspections on petitioners establishment the following day. In his inspection report,4 Labor and Employment Officer III, Crisanto Rey Dingle, found that petitioner has thirteen5 employees and had committed the following violations: underpayment of minimum wage, 13th month pay, holiday premiums, overtime premiums, and non-payment of rest day. The findings in the inspection report were explained to petitioners officer -in-charge, Ma. Fe Boquiren, who signed the same.

22

The first hearing of the case was scheduled on December 27, 1995, but petitioner failed to appear, thus, the hearing was reset to January 10, 1996. On the date set, Boquiren, as petitioners representative, appeared with the information that petitioners President/General Manager Luisito Cirineo was sick and confined in a hospital. On the January 19, 1996 hearing, Cirineo appeared and asked for more time to settle with his employees. The case was again set on January 26, 1996 but Cirineo failed to appear. On April 22, 1996, an Order6 was issued by the DOLE Regional Office, the dispositive portion of which reads: WHEREFORE, premises considered and considering further that the amount computed constitutes part of the lawful remunerations of thirteen affected employees, respondent is hereby ordered to pay them the total amount of THREE HUNDRED SEVENTY SEVEN THOUSAND FIVE HUNDRED PESOS AND 58/100. (P377,500.58), representing their unpaid/underpaid wages, 13th month pay, holiday premiums, rest day pay and overtime premiums distributed as follows: NAME 1. Gerry Sensing 2. Belen Fernandez 3. Mirasol Diaz 4. Margarita Abril AMOUNT P 9,505.68 14,258.52 12,458.52 31,557.12

5. Lamberto Solano 53,151.12 6. Dario Benitez 7. Manuel Benitez 8. Ronillo Tandoc 9. Edgar Dizon 10. Jovelyn Quinto 53,151.12 53,151.12 36,951.12 14,637.78 22,769.88

11. Karen Remoran 21,387.78 12. Jennifer Ringor 13. Eligio Paolo, Jr. TOTAL 37,304.82 12,810.00 P 373,094.58

and to submit the proof of payment to this Office within ten (10) days from receipt hereof. Otherwise, a Writ of Execution will be issued to enforce this order. Respondent is further ORDERED to adjust the salaries of its employees to the applicable daily minimum wages and to submit the proof thereof within the same period. SO ORDERED.7 copy of which was received by petitioners counsel on May 17, 1996. No motion for reconsideration or appeal memorandum was filed by petitione r. On May 27, 1996, petitioners representative, Carmen Zapata, appeared before the DOLE Regional Office and submitted the quitclaims, waivers and releases of employees-awardees, Lamberto Solano, Jovelyn Quinto, Manuel Benitez, Edgar Dizon, Ronillo Tandoc, Eligio Paolo, Jr., and Dario Benitez. Later, however, Benitez, Tandoc, Quinto and Dizon wrote DOLE a letter denying having received any amount from petitioner. Thus, DOLEs inspector Dingle went to petitioners establishment to confirm the authenticity of the quitclaims and releases and talked to the employees concerned who stated that they signed the document without knowing its contents but they are willing to settle if they will be given the amount computed by DOLE.1awphi1.nt On June 19, 1996, Luisito Cirineo and a certain Fe Cirineo Octaviano, owner of Esperanza Seafoods Kitchenette stationed in petitioners establishment, wrote DOLE a letter requesting that the case be endorsed to the National Labor Relations Commission since the resolution of the case required evidentiary matters not disclosed or verified in the normal course of inspection. They also submitted documents to show that petitioner and Esperanza Seafoods Kitchenette are separate and distinct business entities and that some of the employeesawardees are actually employees of the Esperanza Seafoods Kitchenette. On September 12, 1996, DOLE issued its Order8 stating among others:

23

Records show that respondent, Luisito Cirineo and his representative appeared before this Office during the summary investigation of this instant case but they never once mentioned the issue of separate juridical personalities. Respondent had always been bent on settling the respective claims of all thirteen (13) concerned employees. In the process, however, he acknowledged being their employer. He cannot at this juncture therefore say, that some of the awardees in our ORDER are employees of another business entity. This being the case, we cannot grant his request for indorsement to the NLRC. WHEREFORE, premises considered, the case of employees Eligio Paolo, Jr. and Lamberto Solano whose respective claims had been settled by respondent is hereby DISMISSED. The ORDER for the payment of the monetary claims of the eleven (11) other cash awardees STANDS. Let execution follow immediately. 9 (Emphasis supplied) On October 21, 1996, DOLE Regional Director Maximo B. Lim issued a writ of execution.10 On November 13, 1996, petitioner filed a motion to quash11 the writ of execution alleging the following grounds: I. The Writ of Execution seeks to satisfy the monetary awards given to employees who are not employees of Cirineo Bowling Plaza, Inc.. II. The Writ of Execution seeks to satisfy monetary awards given to employees of Fe Esperanza C. Octaviano who was not impleaded. III. The Writ of Execution seeks to satisfy monetary awards wrongfully given to employees employed by establishments employing less than ten (10) employees, who are not for this reason entitled to holiday and holiday premium pay, nor to underpayment of wages. IV. The Writ of Execution seeks to satisfy the award of benefits in excess of the jurisdictional amount allowed by law. V. The Writ of Execution seeks to enforce an Order issued beyond the quasi-judicial authority of the Regional Director12 . In an Order13 dated February 7, 1997, DOLE Regional Director Lim denied petitioners motion to quash the writ of execution. Petitioner filed its Memorandum of Appeal to the Secretary of Labor and Employment14 who dismissed the appeal on the ground that same was filed out of time.15 On motion for reconsideration, the appeal was granted and the appeal was given due course. However, on March 30, 1999, DOLE Undersecretary Jose Espaol dismissed the appeal and affirmed the order dated February 7, 1997 of the DOLE Regional Director with the following disquisitions: In support thereof, respondent alleges that it had only eight (8) employees as the "other claimants of labor benefits . . . are employees of Fe Esperanza Octaviano doing business under the name and style "Esperanza Seafoods Kitchenette." Thus, it points out that: ... Hence, under the Labor Code, Article 94 thereof the employees of the appellant are not entitled to holiday pay and holiday premium pay. Under Republic Act 6727 and its Implementing Rules, Chapter 1, Section 1 thereof, establishments employing less than ten (10) employees are exempted from compliance with minimum wage rates. Hence, the wages given to respondents do not constitute under payments. As to their claims for overtime pay and rest day pay, there is no proof that respondents rendered overtime or restday work, hence they are not entitled to the same. (Cagampanan vs. NLRC, 195 SCRA 533) We do not agree. The records show that during the summary investigation respondent never refuted the findings of the labor inspector particularly the identity of the thirteen (13) concerned employees nor raised the issue of separate juridical personalities of respondent Cirineo and Esperanza Seafoods Kitchenette. Thus, in the Order dated 07 February 1997, the Regional Director ruled: . . . Respondents actuation during and after the summary investigation disclosed that it was bent on settling all the claims of the claimant-awardees and never did it refute the identity of the concerned awardees. Otherwise, respondent could have easily raised the issue by admitting evidence such as payrolls, daily time records and any similar document which could have pinpointed the real employer of the claimants. ... The documents submitted to this Office by respondent could be interpreted as a desperate attempt to mislead this Office and to evade liability. On the issue of jurisdiction, we rule that the Regional Director has jurisdiction over the instant case.

24

The old rule limiting the jurisdiction of the Secretary of Labor and Employment or his duly authorized representatives to money claims not exceeding P5,000.00 has been repealed by the passage of R.A. No. 7730, Section 1 of which reads: Section 1. Paragraph (b) of Article 128 of the Labor Code. As amended, is hereby further amended to read as follows: Art. 128. Visitorial and Enforcement Power. ... (b) Notwithstanding the provisions of Articles 129 and 217 of this Code to the contrary, and in cases where the relationship of employer-employee still exists, the Secretary of Labor and Employment or his duly authorized representative shall have the power to issue compliance orders to give effect to the labor standards provisions of this Code and other labor legislation based on the finding of the labor employment and enforcement officer or industrial safety engineers made in the course of inspection. The Secretary or his duly authorized representatives shall issue writs of execution to the appropriate authority for the enforcement of their orders, except in cases where the employer contests the findings of the labor employment and enforcement officer and raises issues supported by documentary proofs which were not considered in the course of inspection. Pursuant to R.A. 7730, the jurisdictional limitations imposed by Article 129 on the visitorial and enforcement powers of this Office under Article 128 of the Labor Code, have been repealed. The phrase "notwithstanding the provision of Articles 129 and 217 of the Labor Code to the contrary," erases all doubts as to the amendatory nature of R.A. No. 7730. The amendment, in effect, overturned the rulings in the Aboitiz and Servandos cases insofar as the restrictive effect of Article 129 on the use of the power under Article 128 is concerned. Indeed, the Supreme Court in Nazareno Furniture vs. Hon. Secretary of Labor and Employment and Tomas Mendoza (G.R. No. 128546, April 30, 1997), already ruled that: Petitioner is incorrect in stating that R.A. 7730 did not specifically amend Art. 217 of the Labor Code. In fact, it is plainly stated that the amendment applies notwithstanding the provisions of Articles 129 and 217 to the contrary. Even if Article 217 confers original and exclusive jurisdiction over cases such as the one subject of this petition, this has been modified by the later enactment of R.A. 7730. . . ."16 Petitioners motion for reconsideration was denied in a Resolution dated April 18, 2000.17 Petitioner filed a petition for certiorari with prayer for the issuance of temporary restraining order with the CA. On August 31, 2000, the CA dismissed the petition for failure of petitioner to (1) attach a copy of the letter complaint filed by petitioners employees and the Order dated February 7, 1997 of the DOLE Regional Director and (2) state the material date when the assailed Orders/Resolutions were received pursuant to Section 1 of Rule 65 and Section 3 of Rule 46 of the 1997 Rules of Civil Procedure. Petitioner filed a motion for reconsideration which was also denied by the CA on November 10, 2000, copy of which was received by petitioner on November 24, 2000.1a\^/phi1.net Petitioner comes to us by way of a petition for certiorari under Rule 65 raising the sole issue: PUBLIC RESPONDENT ACTED WITH GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION WHEN IT DISMISSED THE INSTANT PETITION AND OUTRIGHT DISMISSAL OF PETITIONERS MOTION FOR RECONSIDERATION DUE TO MERE TECHNICALITIES. Respondents did not file their comment on the petition. We dismiss the petition. We find no grave abuse of discretion committed by the CA in issuing the assailed resolutions. The CA dismissed the petition for certiorari for failure of petitioner to attach certain documents and to state the material date. While petitioner filed its motion for reconsideration, attaching the required documents, the CA correctly found that it still did not state the material date when it received the DOLEs Resolution dated April 18, 2000 denying its motion for reconsideration. Thus, without the date of receipt of the denial of such motion, the CA could not determine whether the petition was filed within the reglementary period of sixty days for filing the petition for certiorari under Rule 65 of the Rules of Court. Under Section 3, Rule 46 of the 1997 Rules of Civil Procedure, as amended by SC Circular No. 39-98, in original actions for certiorari filed with the CA, the petition must include the following material dates, to wit: Section 3. Contents and filing of petition; effect of non-compliance with requirements.... In actions filed under Rule 65, the petition shall further indicate the material dates showing when the notice of the judgment or final order or resolution subject thereof was received, when a motion for new trial or reconsideration, if any, was filed and when notice of the denial thereof was received. ...

25

The failure of the petitioner to comply with any of the foregoing requirements shall be sufficient ground for the dismissal of the petition. It bears stressing that the timely perfection of an appeal is a mandatory requirement, which cannot be trifled with as a "mere technicality" to suit the interest of a party. The rules on periods for filing appeals are to be observed religiously, and parties who seek to avail themselves of the privilege must comply with the rules.18 The failure to perfect an appeal as required by law renders the judgment final and executory.19 While there are exceptional cases where we set aside procedural defects to correct a patent injustice, there should be an effort on the part of the party invoking liberality to at least explain its failure to comply with the rules.20 It appears that petitioners new counsel failed to state the material date twice, first in its petition filed with the CA and, second, in its motion for reconsideration. Petitioners explanation focused on the fact that its President, Luisito Cirineo, only learned of the DOLEs denial of its motion for reconsideration on August 1, 2000 when he came back from a trip from Europe; that efforts to communicate with its former counsel remained futile. We find such explanation unsatisfactory since the material dates can easily be verified from the files of the DOLE office. Even if we disregard technicality, we find the arguments raised by petitioner without merit. As correctly held by the DOLE Regional Director and sustained by the DOLE Undersecretary, records show that petitioner never refuted the findings of the labor inspector as to the identity of the thirteen employees nor raised the issue of separate juridical personalities of petitioner Cirineo and Esperanza Seafoods Kitchenette during the investigation and on the hearings conducted. Likewise, we sustain the jurisdiction of the DOLE Regional Director.l^vvphi1.net The visitorial and enforcement powers of the DOLE Regional Director to order and enforce compliance with labor standard laws can be exercised even where the individual claim exceeds P5,000.00.21 In Allied Investigation Bureau, Inc. vs. Secretary of Labor and Employment ,22 we elucidated: Petitioner argues that the power to adjudicate money claims belongs to the Labor Arbiter who has exclusive jurisdiction over employees claims where the aggregate amount of the claims of each employee exceeds P5,000.00; and, that the Labor Arbiter has jurisdiction over all other claims arising from employer-employee relations, including those of persons in domestic or household service, involving an amount exceeding five thousand pesos (P5,000.00), whether or not accompanied with a claim for reinstatement. Petitioners arguments are untenable. While it is true that under Articles 129 and 217 of the Labor Code, the Labor Arbiter has jurisdiction to hear and decide cases where the aggregate money claims of each employee exceeds P5,000.00, said provisions of law do not contemplate nor cover the visitorial and enforcement powers of the Secretary of Labor or his duly authorized representatives. Rather, said powers are defined and set forth in Article 128 of the Labor Code (as amended by R.A. No. 7730) thus: Art. 128. Visitorial and enforcement power. (a) The Secretary of Labor or his duly authorized representatives, including labor regulation officers, shall have access to employers records and premises at any time of the day or night whenever work is being undertaken therein, and the right to copy therefrom, to question any employee and investigate any fact, condition or matter which may be necessary to determine violations or which may aid in the enforcement of this Code and of any labor law, wage order or rules and regulations issued pursuant thereto. (b) Notwithstanding the provisions of Articles 129 and 217 of this Code to the contrary, and in cases where the relationship of employer-employee exists, the Secretary of Labor and Employment or his duly authorized representatives shall have the power to issue compliance orders to give effect to the labor standards provisions of this Code and other labor legislation based on the findings of labor employment and enforcement officers or industrial safety engineers made in the course of inspection. The Secretary or his duly authorized representatives shall issue writs of execution to the appropriate authority for the enforcement of their orders, except in cases where the employer contests the finding of the labor employment and enforcement officer and raises issues supported by documentary proofs which were not considered in the course of inspection. An order issued by the duly authorized representative of the Secretary of Labor and Employment under this article may be appealed to the latter. In case said order involved a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond issued by a reputable bonding company duly accredited by the Secretary of Labor and Employment in the amount equivalent to the monetary award in the order appealed from. ... The aforequoted provision explicitly excludes from its coverage Articles 129 and 217 of the Labor Code by the phrase "(N)otwithstanding the provisions of Articles 129 and 217 of this Code to the contrary . . ." thereby retaining and further strengthening the power of the Secretary of Labor or his duly authorized representative to issue compliance orders to give effect to the labor standards provisions of said Code and other labor legislation based on the findings of labor employment and enforcement officers or industrial safety engineers made in the course of inspection. In the case at bar, the Office of respondent Regional Director conducted inspection visits at petitioners establishment on February 9 and 14, 1995 in accordance with the abovementioned provision of law. In the course of said inspection, several violations of the labor standard provisions of the Labor Code were discovered and reported by Senior Labor Enforcement Officer Eduvigis A. Acero in his Notice of Inspection Results. It was on the bases of the aforesaid findings (which petitioner did not contest), that respondent Regional

26

Director issued the assailed Order for petitioner to pay private respondents the respective wage differentials due them. Clearly, as the duly authorized representative of respondent Secretary of Labor, and in the lawful exercise of the Secretarys visitorial and enforcement powers under Article 128 of the Labor Code, respondent Regional Director had jurisdiction to issue his impugned Order. In a recent case, the Supreme Court ruled in this wise: Assailed in this special civil action for certiorari is the Order dated August 1, 1995 issued by public respondent Regional Director Romeo A. Young of the Department of Labor and Employment (DOLE) in Case No. NCROO-9503-IS-035, ordering petitioner Lord and Lady Salon to pay private respondent Ateldo Barroga the sum of P14,099.05 representing his underpaid wages and premium pay for work on holidays. This suit is an offshoot of the complaint for payment of salary differentials filed by private respondent against petitioner on March 20, 1995. Upon investigation conducted by public respondents office, petitioner was found to have committed the following violations: (1) underpayment of wages, (2) nonimplementation of premium pay for worked legal holidays, and (3) non-availability of records at the time of inspection. Consequent to the parties failure to reach an amicable settlement, public respondent issued the assailed resolution. Petitioner asserts that public respondent exceeded his jurisdiction in taking cognizance of the complaint and ordering the payment of P14,099.05 to private respondent because the award of the latter amount goes over the jurisdictional amount of P5,000.00 for cases filed before the Regional Director, thus, is properly cognizable by the Labor Arbiter instead. We dismiss the petition. Pursuant to Section 1 of Republic Act 7730 [Approved on June 2, 1994] which amended Article 128 (b) of the Labor Code, the Secretary of Labor and Employment or his duly authorized representative, in the exercise of their visitorial and enforcement powers, are now authorized to issue compliance orders to give effect to the labor standards provisions of this Code and other labor legislation based on the findings of labor employment and enforcement officers or industrial safety engineers made in the course of inspection, sans any restriction with respect to the jurisdictional amount of P5,000.00 provided under Article 129 and Article 217 of the Code. The instant case therefore falls squarely within the coverage of the aforecited amendment as the assailed order was issued to enforce compliance with the provisions of the Code with respect to the payment of proper wages. Hence, petitioners claim of lack of jurisdiction on the part of public respondent is bereft of merit.23 WHEREFORE, the instant petition is DISMISSED for lack of merit. SO ORDERED. Puno, (Chairman), Callejo, Sr., Tinga, and Chico-Nazario, JJ., concur.

6. digests article III sections 5-8, constitutional law Garces vs. Estenso
Facts: The case is about the constitutionality of four resolutions of the barangay council of Valencia, Ormoc City, regarding the acquisition of the wooden image of San Vicente Ferrer to be used in the celebration of his annual feast day. That issue was spawned by the controversy as to whether the parish priest or a layman should have the custody of the image. On March 23, 1976, the said barangay council adopted Resolution No. 5, "reviving the traditional socio-religious celebration" every fifth day of April "of the feast day of Seor San Vicente Ferrer, the patron saint of Valencia". Issue: Is the holding of fiesta and having a patron saint for the barrio, valid and constitutional? Held: Yes. The wooden image was purchased in connection with the celebration of the barrio fiesta honoring the patron saint, San Vicente Ferrer, and not for the purpose of favoring any religion nor interfering with religious matters or the religious beliefs of the barrio residents. One of the highlights of the fiesta was the mass. Consequently, the image of the patron saint had to be placed in the church when the mass was celebrated. If there is nothing unconstitutional or illegal in holding a fiesta and having a patron saint for the barrio, then any activity intended to facilitate the worship of the patron saint (such as the acquisition and display of his image) cannot be branded as illegal. As noted in the first resolution, the barrio fiesta is a socio-religious affair. Its celebration is an ingrained tradition in rural communities. The fiesta relieves the monotony and drudgery of the lives of the masses.

Tolentino vs. Secretary of Finance Facts: These are motions seeking reconsideration of our decision dismissing the petitions filed in these cases for the declaration of unconstitutionality of R.A. No. 7716, otherwise known as the Expanded Value-Added Tax Law. Now it is contended by the PPI that by removing the exemption of the press from the VAT while maintaining those granted to others, the law discriminates against the press. At any rate, it is averred, "even nondiscriminatory taxation of constitutionally guaranteed freedom is unconstitutional."

27

Issue: Does sales tax on bible sales violative of religious freedom? Held: No. The Court was speaking in that case of a license tax, which, unlike an ordinary tax, is mainly for regulation. Its imposition on the press is unconstitutional because it lays a prior restraint on the exercise of its right. Hence, although its application to others, such those selling goods, is valid, its application to the press or to religious groups, such as the Jehovah's Witnesses, in connection with the latter's sale of religious books and pamphlets, is unconstitutional. As the U.S. Supreme Court put it, "it is one thing to impose a tax on income or property of a preacher. It is quite another thing to exact a tax on him for delivering a sermon." The VAT is, however, different. It is not a license tax. It is not a tax on the exercise of a privilege, much less a constitutional right. It is imposed on the sale, barter, lease or exchange of goods or properties or the sale or exchange of services and the lease of properties purely for revenue purposes. To subject the press to its payment is not to burden the exercise of its right any more than to make the press pay income tax or subject it to general regulation is not to violate its freedom under the Constitution Manosca vs. CA Facts: Petitioners inherited a piece of land when the parcel was ascertained by the NHI to have been the birth site of Felix Y. Manalo, the founder of Iglesia Ni Cristo, it passed Resolution No. 1, declaring the land to be a national historical landmark. Petitioners moved to dismiss the complaint on the main thesis that the intended expropriation was not for a public purpose and, incidentally, that the act would constitute an application of public funds, directly or indirectly, for the use, benefit, or support of Iglesia ni Cristo, a religious entity, contrary to the provision of Section 29(2), Article VI, of the 1987 Constitution. Issue: The expropriation of the land whereat Manalo was born, valid and constitutional? Held: Yes. The taking to be valid must be for public use. There was a time when it was felt that a literal meaning should be attached to such a requirement. Whatever project is undertaken must be for the public to enjoy, as in the case of streets or parks. Otherwise, expropriation is not allowable. It is not so any more. As long as the purpose of the taking is public, then the power of eminent domain comes into play. As just noted, the constitution in at least two cases, to remove any doubt, determines what is public use. One is the expropriation of lands to be subdivided into small lots for resale at cost to individuals. The other is the transfer, through the exercise of this power, of utilities and other private enterprise to the government. It is accurate to state then that at present whatever may be beneficially employed for the general welfare satisfies the requirement of public use. Ebralinag vs. DepEd Facts: All the petitioners in the original case were minor school children, and members of the sect, Jehovah's Witnesses (assisted by their parents) who were expelled from their classes by various public school authorities in Cebu for refusing to salute the flag, sing the national anthem and recite the patriotic pledge as required by Republic Act No. 1265 of July 11, 1955 and by Department Order No. 8, dated July 21, 1955 issued by the Department of Education. Aimed primarily at private educational institutions which did not observe the flag ceremony exercises, Republic Act No. 1265 penalizes all educational institutions for failure or refusal to observe the flag ceremony with public censure on first offense and cancellation of the recognition or permit on second offense. Issue: Does refusal to take part in the flag ceremony, on account of religious belief, so offensive as to prompt legitimate state intervention? Held: No. While conceding to the idea adverted to by the Solicitor General that certain methods of religious expression may be prohibited to serve legitimate societal purposes, refusal to participate in the flag ceremony hardly constitutes a form of religious expression so offensive and noxious as to prompt legitimate State intervention. It bears repeating that their absence from the ceremony hardly constitutes a danger so grave and imminent as to warrant the state's intervention. In the case of a regulation which appears to abridge a right to which the fundamental law accords high significance it is the regulation, not the act (or refusal to act), which is the exception and which requires the court's strictest scrutiny. In the case at bench, the government has not shown that refusal to do the acts of conformity exacted by the assailed orders, which respondents point out attained legislative cachet in the Administrative Code of 1987, would pose a clear and present danger of a danger so serious and imminent, that it would prompt legitimate State intervention. Estrada vs. Escritor? Facts: Alejandro Estrada wrote to Judge Caoibes, Jr., requesting for an investigation of rumors that respondent Soledad Escritor, court interpreter in said court, is living with a man not her husband. They allegedly have a child of eighteen to twenty years old. He filed the charge against Escritor as he believes that she is committing an immoral act that tarnishes the image of the court, thus she should not be allowed to remain employed therein as it might appear

28

that the court condones her act.

Issue: What is the doctrine of benevolent neutrality? Is respondent entitled thereto? Is the doctrine of benevolent neutrality consistent with the free exercise clause? Held: Benevolent neutrality recognizes that government must pursue its secular goals and interests but at the same time strives to uphold religious liberty to the greatest extent possible within flexible constitutional limits. Thus, although the morality contemplated by laws is secular, benevolent neutrality could allow for accommodation of morality based on religion, provided it does not offend compelling state interests. It still remains to be seen if respondent is entitled to such doctrine as the state has not been afforded the chance has demonstrate the compelling state interest of prohibiting the act of respondent, thus the case is remanded to the RTC. Benevolent neutrality is inconsistent with the Free Exercise Clause as far as it prohibits such exercise given a compelling state interest. It is the respondents stance that her conjugal arrangement is not immoral and punishable as it comes within the scope of free exercise protection. Should the Court prohibit and punish her conduct where it is protected by the Free Exercise Clause, the Courts action would be an unconstitutional encroachment of her right to religious freedom. We cannot therefore simply take a passing look at respondents claim of religious freedom, bu t must instead apply the compelling state interest test. The government must be heard on the issue as it has not been given an opportunity to discharge its burden of demonstrating the states compelling interest which can override respondents religious belief and practice. Pamil vs. Teleron? Facts: The novel question in this case concerns the eligibility of an ecclesiastic to an elective municipal position. Private respondent, Father Margarito R. Gonzaga, was, in 1971, elected to the position of municipal mayor of Alburquerque, Bohol. Therefore, he was duly proclaimed. A suit was then filed by petitioner, himself an aspirant for the office, for his disqualification based on this Administrative Code provision: "In no case shall there be elected or appointed to a municipal office ecclesiastics, soldiers in active service, persons receiving salaries or compensation from provincial or national funds, or contractors for public works of the municipality." Issue: Is the prohibition imposed on ecclesiastics from holding appointive or elective municipal offices a religious test? Held: No. The vote is thus indecisive. While five members of the Court constitute a minority, the vote of the remaining seven does not suffice to render the challenged provision ineffective. Section 2175 of the Revised Administrative Code, as far as ecclesiastics are concerned, must be accorded respect. The presumption of validity calls for its application. Under the circumstances, certiorari lies. That is the conclusion arrived at by the writer of this opinion, joined by Justice Concepcion Jr., Santos, Fernandez, and Guerrero. They have no choice then but to vote for the reversal of the lower court decision and declare ineligible respondent Father Margarito R. Gonzaga for the office of municipal mayor. With the aforesaid five other members, led by the Chief Justice, entertaining no doubt as to his lack of eligibility, this petition for certiorari must be granted. It would be an unjustified departure from a settled principle of the applicable construction of the provision on what laws remain operative after 1935 if the plea of petitioner in this case were to be heeded. The challenged Administrative Code provision, certainly insofar as it declares ineligible ecclesiastics to any elective or appointive office, is, on its face, inconsistent with the religious freedom guaranteed by the Constitution. To so exclude them is to impose a religious test. Here being an ecclesiastic and therefore professing a religious faith suffices to disqualify for a public office. There is thus an incompatibility between the Administrative Code provision relied upon by petitioner and an express constitutional mandate. It is not a valid argument against this conclusion to assert that under the Philippine Autonomy Act of 1916, there was such a prohibition against a religious test, and yet such a ban on holding a municipal position had not been nullified. It suffices to answer that no question was raised as to its validity. Taruc vs. Bishop Dela Cruz Facts: Petitioners were lay members of the Philippine Independent Church (PIC). On June 28, 1993, Bishop de la Cruz declared petitioners expelled/excommunicated from the Philippine Independent Church. Because of the order of expulsion/excommunication, petitioners filed a complaint for damages with preliminary injunction against Bishop de la Cruz before the Regional Trial Court.They contended that their expulsion was illegal because it was done without trial thus violating their right to due process of law. Issue: What is the role of the State, through the Courts, on matters of religious intramurals? Held: The expulsion/excommunication of members of a religious institution/organization is a matter best left to the discretion of the officials, and the laws and canons, of said institution/organization. It is not for the courts to exercise control over church authorities in the performance of their discretionary

29

and official functions. Rather, it is for the members of religious institutions/organizations to conform to just church regulations. Civil Courts will not interfere in the internal affairs of a religious organization except for the protection of civil or property rights. Those rights may be the subject of litigation in a civil court, and the courts have jurisdiction to determine controverted claims to the title, use, or possession of church property.

Obviously, there was no violation of a civil right in the present case. Soriano vs. La Guardia Facts: On August 10, 2004, at around 10:00 p.m., petitioner, as host of the program Ang Dating Daan, aired on UNTV 37, made obscene remarks against INC. Two days after, before the MTRCB, separate but almost identical affidavit-complaints were lodged by Jessie L. Galapon and seven other private respondents, all members of the Iglesia ni Cristo (INC), against petitioner in connection with the above broadcast. Respondent Michael M. Sandoval, who felt directly alluded to in petitioners remark, was then a minister of INC and a regular host of the TV program Ang Tamang D aan.

Issue: Are Sorianos statements during the televised Ang Dating Daan part of the religious discourse and within the protection of Section 5, Art.III? Held: No. Under the circumstances obtaining in this case, therefore, and considering the adverse effect of petitioners utterances on the viewers fundamental rights as well as petitioners clear violation of his duty as a public trustee, the MTRCB properly suspended him from appearing in A ng Dating Daan for three months. Furthermore, it cannot be properly asserted that petitioners suspension was an undue curtailment of his right to free speech either as a prior restraint or as a subsequent punishment. Aside from the reasons given above (re the paramountcy of viewers rights, the public trusteeship character of a broadcasters role and the power of the State to regulate broadcast media), a requirement that indecent language be avoided has its primary effect on the form, rather than the content, of serious communication. There are few, if any, thoughts that cannot be expressed by the use of less offensive language. Section 6 Yap vs. CA Facts: The right against excessive bail, and the liberty of abode and travel, are being invoked to set aside two resolutions of the Court of Appeals which fixed bail at P5,500,000.00 and imposed conditions on change of residence and travel abroad. For misappropriating amounts equivalent to P5,500,000.00, petitioner was convicted of estafa and was sentenced to four years and two months of prision correccional, as minimum, to eight years of prision mayor as maximum, in addition to one (1) year for each additional P10,000.00 in excess of P22,000.00 but in no case shall it exceed twenty (20) years. He filed a notice of appeal, and moved to be allowed provisional liberty under the cash bond he had filed earlier in the proceedings.

Issue: Was the condition imposed by the CA on accuseds bail bond violative the liberty of abode and right to travel? Held: Imposing bail in an excessive amount could render meaningless the right to bail. Under the circumstances of this case, we find that appropriate conditions have been imposed in the bail bond to ensure against the risk of flight, particularly, the combination of the hold-departure order and the requirement that petitioner inform the court of any change of residence and of his whereabouts. Although an increase in the amount of bail while the case is on appeal may be meritorious, we find that the setting of the amount at P5,500,000.00 is unreasonable, excessive, and constitutes an effective denial of petitioners right to bail. Cojuangco vs. Sandiganbayan Facts: This petition for prohibition seeks to dismiss Criminal Case entitled People of the Philippines vs. Eduardo M. Cojuangco, Jr., et al., now pending before respondent Sandiganbayan and to prohibit said court from further proceeding with the case. Petitioner invokes his constitutional right to due process, a speedy trial, and a speedy determination of his cases before all judicial, quasi-judicial and administrative bodies. Further, he prays for the issuance of a Temporary Restraining Order and/or Writ of Preliminary Injunction enjoining respondent Sandiganbayan from further enforcing and/or implementing its order dated February 20, 1995 which bans petitioner from leaving the country except upon prior approval by said court.

Issue: When a person is criminally charged, is his right to travel absolutely curtailed? Held: No.The travel ban should be lifted, considering all the circumstances now prevailing. The rule laid down by this Court is that a person facing a criminal indictment and provisionally released on bail does not have an unrestricted right to travel, the reason being that a persons right to travel is subject to the usual constraints imposed by the very necessity of safeguarding the system of justice. But, significantly, the Office of the Solicitor General in

30

its Manifestation dated November 20, 1998 indicated that it is not interposing any objection to petitioners prayer that he b e allowed to travel abroad based on the following considerations: (1) that it is well within the power of this Court to suspend its own rules, including the second paragraph, Section 23, Rule 114 of the Rules of Court; (2) that it has been shown in the past that the petitioner has always returned to the Philippines after the expiration of the period of his allowed travel; and (3) that petitioner, now Chairman of the Board of San Miguel Corporation, may be constrained to leave the country for business purposes, more often than he had done in the past. Mirasol vs. DPWH Facts: On 19 February 1968, Secretary Antonio V. Raquiza of the Department of Public Works and Communications issued AO 1, which, among others, prohibited motorcycles on limited access highways. Accordingly, petitioners filed an Amended Petition on February 8, 2001 wherein petitioners sought the declaration of nullity of the aforesaid administrative issuances. Moreover, petitioners prayed for the issuance of a temporary restraining order and/or preliminary injunction to prevent the enforcement of the total ban on motorcycles along the entire breadth of North and South Luzon Expressways and the Manila-Cavite (Coastal Road) Toll Expressway under DO 215. Issue: Is DPWH Administrative Order No.1, DO 74 violative of the right to travel? Are all motorized vehicles created equal?

Held: DO 74 and DO 215 are void because the DPWH has no authority to declare certain expressways as limited access facilities. Under the law, it is the DOTC which is authorized to administer and enforce all laws, rules and regulations in the field of transportation and to regulate related activities. The DPWH cannot delegate a power or function which it does not possess in the first place. We find that it is neither warranted nor reasonable for petitioners to say that the only justifiable classification among modes of transport is the motorized against the non-motorized. Not all motorized vehicles are created equal. A 16-wheeler truck is substantially different from other light vehicles. The first may be denied access to some roads where the latter are free to drive. Old vehicles may be reasonably differentiated from newer models.46 We find that real and substantial differences exist between a motorcycle and other forms of transport sufficient to justify its classification among those prohibited from plying the toll ways. Amongst all types of motorized transport, it is obvious, even to a child, that a motorcycle is quite different from a car, a bus or a truck. The most obvious and troubling difference would be that a two-wheeled vehicle is less stable and more easily overturned than a four-wheeled vehicle.

Section 8 Jacinto vs. CA Facts: Petitioners are public school teachers from various schools in Metropolitan Manila. Between the period September 17 to 21, 1990, they incurred unauthorized absences in connection with the mass actions then staged; and on September 17, 1990, DECS Secretary Isidro Cario immediately issued a return-to-work order. They were administratively charged with gross misconduct; gross neglect of duty, etc. for joining unauthorized mass actions; ignoring report-to-work directives; unjustified abandonment of teaching posts; non-observance of Civil Service law, rules and regulations; non-compliance with reasonable office rules and regulations; and incurring unauthorized absences without leave, etc.

Issue: Were the public school teachers penalized for the exercise of their right to assemble peacefully and to petition the government for redress of grievances? Held: Improper Exercise of the Right to Peaceful Assembly and to Petition for a Redress of Grievances. There is no question as to the petitioners rights to peaceful assembly to petition the government for a redress of grievances and, for that matter, to organize or form associations for purposes not contrary to law, as well as to engage in peaceful concerted activities. Although the Constitution vests in them the right to organize, to assemble peaceably and to petition the government for a redress of grievances, there is no like express provision granting them the right to strike. Rather, the constitutional grant of the right to strike is restrained by the proviso that its exercise shall be done in accordance with law. It cannot be denied that the mass action or assembly staged by the petitioners resulted in the non-holding of classes in several public schools during the corresponding period. MPSTA vs. Laguio Facts: The series of events that touched off these cases started with the so-called "mass action" undertaken by some 800 public school teachers, among them members of the petitioning associations in both cases, on September 17, 1990 to "dramatize and highlight" 1 the teachers' plight resulting from the alleged failure of the public authorities to act upon grievances that had time and again been brought to the latter's attention.

31

Issue: Are employees in the public service prohibited from forming unions and holding strikes? Held: these mass actions were to all intents and purposes a strike; they constituted a concerted and unauthorized stoppage of, or absence from, work which it was the teachers duty to perform, undertaken for essentially economic reasons, should not principally resolve the present case, as the underlying facts are allegedly not identical. Air Philippines vs Pennswell Inc. Gr. 172835 Facts: Petitioner is a domestic corporation engaged in the business of air transportation services. While, respondent was organized to engage in the business of manufacturing and selling industrial chemicals, solvents, and special lubricants. In particular, petitioner alleged that it was defrauded by respondent for its previous sale. Petitioner seeks to convince this Court that it has a right to obtain the chemical composition and ingredients of respondents products to conduct a comparative analysis of its products Issue: Can chemical components of Pennswell products be accessed pursuant to RA 7394, 8203, 6969 and right to information under Sec. 7, Art III? Held: No. Jurisprudence has consistently acknowledged the private character of trade secrets. There is a privilege not to disclose ones trade secrets. Foremost, this Court has declared that trade secrets and banking transactions are among the recognized restrictions to the right of the people to information as embodied in the Constitution. Petitioner cannot rely on Section 77 of Republic Act 7394, or the Consumer Act of the Philippines, in order to compel respondent to reveal the chemical components of its products. While it is true that all consumer products domestically sold, whether manufactured locally or imported, shall indicate their general make or active ingredients in their respective labels of packaging, the law does not apply to respondent. Respondents specialized lubricants are not consumer products. Its products are not intended for personal, family, household or agricultural purposes. Rather, they are for industrial use, specifically for the use of aircraft propellers and engines. Petitioners argument that Republic Act No. 8203, or the Special Law on Counterfeit Drugs, requires the disclosure of the active ingredients of a drug is also on faulty ground. Respondents products are outside the scope of the cited law. They do not come within the purview of a drug which, as defined therein, refers to any chemical compound or biological substance, other than food, that is intended for use in the treatment, prevention or diagnosis of disease in man or animals. Again, such are not the characteristics of respondents products. Republic Act No. 6969, or the Toxic Substances and Hazardous and Nuclear Wastes Control Act of 1990, also contains a provision that limits the right of the public to have access to records, reports or information concerning chemical substances and mixtures including safety data submitted and data on emission or discharge into the environment, if the matter is confidential such that it would divulge trade secrets, production or sales figures; or methods, production or processes unique to such manufacturer, processor or distributor; or would otherwise tend to affect adversely the competitive position of such manufacturer, processor or distributor.

Akbayan vs. Aquino , GR 170516 FACTS: This is a Petition for mandamus and prohibition requesting respondents to submit to them the full text of the Japan-Philippines Economic Partnership Agreement (JPEPA). Petitioner emphasize that the refusal of the government to disclose the said agreement violates there right to information on matters of public concern and of public interest. That the non-disclosure of the same documents undermines their right to effective and reasonable participation in all levels of social, political and economic decision making. ISSUE: Are the JPEPA negotiations within the scope of the constitutional guarantee of access to information? HELD: No. Secrecy of negotiations with foreign countries is not violative of the constitutional provisions of freedom of speech or of the press nor of the freedom of access to information. The Court holds that, in determining whether an information is covered by the right to information, a specific showing of need for such information is not a relevant consideration, but only whether the same is a matter of public concern. When, however, the government has claimed executive privilege, and it has established that the information is indeed covered by the same, then the party demanding it, if it is to overcome the privilege, must show that that the information is vital, not simply for the satisfaction of its curiosity, but for its ability to effectively and reasonably participate in social, political, and economic decision-making. The constitutional right to information includes official information on on-going negotiations before a final contract. The information, however, must constitute definite propositions by the government and should not cover recognized exceptions like privileged information, military and diplomatic secrets and similar matters affecting national security and public order.

32

Chavez v. PCGG, 299 SCRA 744 FACTS: Petitioner asks this Court to define the nature and the extent of the peoples constitutional right to information on matters of public concern. Petitioner, invoking his constitutional right to information and the correlative duty of the state to disclose publicly all its transactions involving the national interest, demands that respondents make public any and all negotiations and agreements pertaining to PCGGs task of recovering the Marcoses ill-gotten wealth. ISSUE: Are the negotiations leading to a settlement on ill-gotten wealth of the Marcoses within the scope of the constitutional guarantee of access to information? HELD: Yes. Considering the intent of the framers of the Constitution, it is incumbent upon the PCGG and its officers, as well as other government representatives, to disclose sufficient public information on any proposed settlement they have decided to take up with the ostensible owners and holders of ill-gotten wealth. Such information, though, must pertain to definite propositions of the government, not necessarily to intra-agency or inter-agency recommendations or communications during the stage when common assertions are still in the process of being formulated or are in the exploratory stage. There is a need, of course, to observe the same restrictions on disclosure of information in general -- such as on matters involving national security, diplomatic or foreign relations, intelligence and other classified information. FRANCISCO I. CHAVEZ vs. PUBLIC ESTATES AUTHORITY and AMARI COASTAL BAY DEVELOPMENT CORPORATION FACTS: The petition seeks to compel the Public Estates Authority ("PEA" for brevity) to disclose all facts on PEA's then on-going renegotiations with Amari Coastal Bay and Development Corporation ("AMARI" for brevity) to reclaim portions of Manila Bay. The petition further seeks to enjoin PEA from signing a new agreement with AMARI involving such reclamation. PEA asserts that in cases of on-going negotiations the right to information is limited to "definite propositions of the government." PEA maintains the right does not include access to "intra-agency or inter-agency recommendations or communications during the stage when common assertions are still in the process of being formulated or are in the 'exploratory stage'." ISSUE: Are negotiations leading to a settlement with PIATCO within the scope of the constitutional guarantee of access to information? HELD: Yes. Section 7, Article III of the Constitution explains the people's right to information on matters of public concern : Access to official records, and to documents, and papers pertaining to official acts, transactions, or decisions, as well as to government research data used as basis for policy development, shall be afforded the citizen, subject to such limitations as may be provided by law." Further, The State policy (Sec 28, Art II) of full transparency in all transactions involving public interest reinforces the people's right to information on matters of public concern. These twin provisions of the Constitution seek to promote transparency in policy-making and in the operations of the government, as well as provide the people sufficient information to exercise effectively other constitutional rights. Information on on-going evaluation or review of bids or proposals being undertaken by the bidding or review committee is not immediately accessible under the right to information. While the evaluation or review is still on-going, there are no "official acts, transactions, or decisions" on the bids or proposals. However, once the committee makes its official recommendation, there arises a "definite proposition" on the part of the government. Jacinto vs. CA Petitioners are public school teachers from various schools in Metropolitan Manila. Between the period September 17 to 21, 1990, they incurred unauthorized absences in connection with the mass actions then staged. Consequently, due to their failure to heed the return-to-work order, DECS Sec. Cario immediately issued formal charges and preventive suspension orders against them. ISSUE: Were the public school teachers penalized for the exercise of their right to assemble peacefully and to petition the government for redress of grievances? HELD: The petitioners here, except Merlinda Jacinto, were not penalized for the exercise of their right to assemble peacefully and to petition the government for a redress of grievances. Rather, the Civil Service Commission found them guilty of conduct prejudicial to the best interest of the service for having absented themselves without proper authority, from their schools during regular school days, in order to participate in the mass protest, their absence ineluctably resulting in the non-holding of classes and in the deprivation of students of education, for which they were responsible. Had petitioners availed themselves of their free time -- recess, after classes, weekends or holidays -- to dramatize their grievances and to dialogue with the proper authorities within the bounds of law, no one -- not the DECS, the CSC or even this Court -- could have held them liable for the valid exercise of their constitutionally guaranteed rights. As it was, the temporary stoppage of classes resulting from their activity necessarily disrupted public services, the very

33

evil sought to be forestalled by the prohibition against strikes by government workers. Their act by its nature was enjoined by the Civil Service law, rules and regulations, for which they must, therefore, be made answerable.

MANILA PUBLIC SCHOOL TEACHERS ASSOCIATION, FIDEL FABABIER MERLIN ANONUEVO, MINDA GALANG and other teacher-members so numerous similarly situated vs. HON. PERFECTO LAGUIO JR A "mass action" was undertaken by some 800 public school teachers, among them members of the petitioning associations to "dramatize and highlight" the teachers' plight resulting from the alleged failure of the public authorities to act upon grievances that had time and again been brought to the latter's attention. The petition alleges in great detail the character and origins of those grievances as perceived by the petitioners, and the attempts to negotiate their correction. ISSUE: Are employees in the public service prohibited from forming unions and holding strikes? HELD: Employees in the public (civil) service, unlike those in the private sector, do not have the right to strike, although guaranteed the right to selforganization, to petition Congress for the betterment of employment terms and conditions and to negotiate with appropriate government agencies for the improvement of such working conditions as are not fixed by law. Public school teachers have the right to peaceably assemble for redress of grievances but NOT during class hours, for then this would be a strike, which is illegal for them. Re-request for IBP Dues Payment Exemption of Atty. Arevalo, BM 1370 Petitioner sought exemption from payment of IBP dues in the amount of P12,035.00 as alleged unpaid accountability for the years 1977-2005. He alleged that after being admitted to the Philippine Bar in 1961, he became part of the Philippine Civil Service from July 1962 until 1986, then migrated to, and worked in, the USA in December 1986 until his retirement in the year 2003. He maintained that he cannot be assessed IBP dues for the years that he was working in the Philippine Civil Service since the Civil Service law prohibits the practice of ones profession while in government service, and neither can he be assessed for the years when he was working in the USA. ISSUE: Is the compulsory payment of IBP Dues violative of the right to associate? HELD: No. An Integrated Bar is a State-organized Bar, to which every lawyer must belong, as distinguished from bar association organized by individual lawyers themselves, membership in which is voluntary. This requires membership and financial support of every attorney as condition sine qua non to the practice of law and the retention of his name in the Roll of Attorneys of the SC. Bar integration does not compel the lawyer to associate with anyone. He is free to attend or not to attend the meetings of his Integrated Bar Chapter or vote or refuse to vote in its elections as he chooses. The only compulsion to which he is subjected is the payment of his annual dues. The SC, in order to foster the States legitimate interest in elevating the quality of professional legal services, may require that the cost of improving the profession in this fashion be shared by the subjects and beneficiaries of the regulatory program the lawyers. Moreover, there is nothing in the Constitution that prohibits the Court, under its constitutional power and duty to promulgate rules concerning the admission to the practice of law and in the integration of the Philippine Bar - which power required members of a privileged class, such as lawyers are, to pay a reasonable fee toward defraying the expenses of regulation of the profession to which they belong.

7.

Republic of the Philippines SUPREME COURT Manila SECOND DIVISION

G.R. No. 108015 May 20, 1998 CRISTINA DE KNECHT and RENE KNECHT, petitioners,

34

vs. HON. COURT OF APPEALS; HON. MANUEL DUMATOL, as Judge, Regional Trial Court, Branch 112, Pasay City; HON. CONCHITA C. MORALES, as Judge, Regional Trial Court, Branch 110, Pasay City; HON, AURORA NAVARETTE-RECINA, as Judge, Regional Trial Court, Branch 119, Pasay City; HON. SOFRONIO G. SAYO, as Judge, Regional Trial Court, Branch 111, Pasay City; REPUBLIC OF THE PHILIPPINES; SPS. MARIANO & ANACORETA NOCOM; SALEM INVESTMENT CORPORATION; SPS. ANASTACIO & FELISA BABIERA; and SPS. ALEJANDRO & FLOR SANGALANG, respondents. G.R. No. 109234 May 20, 1998 CRISTINA DE KNECHT and RENE KNECHT, petitioner, vs. HON. SOFRONIO SAYO, as Judge, Regional Trial Court, Branch 111, Pasay City; REPUBLIC OF THE PHILIPPINES; PHILIPPINE NATIONAL BANK; and MARIANO NOCOM, respondent.

PUNO, J.: In G.R. No. 108015, petitioners Cristina de Knecht and Rene Knecht seek to annul and set aside the decision of the Court of Appeals 1 in CA-G.R. SP No. 28089 dismissing an action to annul (1) the decision and order of the Regional Trial Court, Branch 112, Pasay City, 2 in LRC Case No. 2636-P; (2) the order of the Regional Trial Court, Branch 110, Pasay City 3 in LRC Case No. 2652-P; and (3) the orders of dismissal by Regional Trial Court, Branch 119, Pasay City in Civil Case No. 2961-P; 4 and (4) the orders and the writ of possession issued by the Regional Trial Court, Branch 111, Pasay City, 5 in Civil Case No. 7327. In G.R. No. 109234, petitioners Cristina de Knecht and Rene Knecht seek to annul the decision of the Court of Appeals 6 in CA-G.R. SP No. 27817 which dismissed the petition for certiorari questioning the order of the Regional Trial Court, Branch 111, Pasay City 7 denying its "Motion for Intervention and to Implead Additional Parties" in Civil Case No. 7327. The instant case is an unending sequel to several suits commenced almost twenty years ago over the same subject matter. This involves a parcel of land with an area of 8,102.68 square meters, more or less, located at the corner of the south end of the E. de los Santos Avenue (EDSA) 8 and F.B. Harrison in Pasay City. The land was owned by petitioners Cristina de Knecht and her son, Rene Knecht , under Transfer Certificate of Title (TCT) No. 9032 issued in their names by the Register of Deeds of Pasay City. On the land, the Knechts constructed eight (8) houses of strong materials, leased out the seven and occupied one of them as their residence. In 1979, the Republic of the Philippines initiated Civil Case No. 7001-P for expropriation against the Knechts' property before the then Court of First Instance of Rizal, Branch 111, Pasay City. 9 The government sought to utilize the land for the completion of the Manila Flood Control and Drainage Project and the extension of the EDSA towards Roxas Boulevard. The CFI issued a writ of possession. On petition of the Knechts, however, this Court, in G.R. No. L-51078, held that the choice of area for the extension of EDSA was arbitrary. We annulled the writ of possession and enjoined the trial court from taking further action Civil Case No. 7001-P. 10 In 1982, the City Treasurer of Pasay discovered that the Knechts failed to pay real estate taxes on the property from 1980 to 1982. 11 As a consequence of this deficiency, the City Treasurer sold the property at public auction on May 27, 1982 for the sum of P63,000.00, the amount of the deficiency taxes. 12 The highest bidders were respondent Spouses Anastacio and Felisa Babiera (the Babieras) and respondent Spouses Alejandro and Flor Sangalang (the Sangalangs). Petitioners failed to redeem the property within one year from the date of sale. In August 1983, Anastacio Babiera filed with respondent Regional Trial Court, Branch 112, Pasay City, a petition for registration of his name as co-owner pro-indiviso of the subject land. This case was docketed as LRC Case No. 2636-p 13 and was filed allegedly without notice to the Knechts. On September 15, 1983, the trial court ordered the Register of Deeds to register Babiera's name and the Knechts to surrender to the Register of Deeds the owner's duplicate of the title. In October 1983, Alejandro Sangalang filed LRC Case No. 2652-P before the Regional Trial Court, Branch 110, Pasay City. 14 Sangalang also sought to register his name as co-owner proindiviso of the subject property. The proceedings were also conducted allegedly without notice to the Knechts. The trial court granted the petition and ordered the Register of Deeds, Pasay City to cancel TCT No. 9032 in the name of the Knechts and issue a new one in the names of Babiera and Sangalang. Pursuant to said orders, the Register of Deeds cancelled TCT No. 9032 and issued TCT No. 86670 in the names of Sangalang and Babiera. The Knechts, who were in possession of the property, allegedly learned of the auction sale only by the time they received the orders of the land registration courts. On March 12, 1985, Sangalang and Babiera sold the land to respondent Salem Investment Corporation (Salem) for P400,000.00. TCT No. 86670 was cancelled and TCT No. 94059 was issued in the name of Salem. Meanwhile, on February 17, 1983, the Batasang Pambansa passed B.P. Blg. 340 authorizing the national government to expropriate certain properties in Pasay City for the EDSA Extension, the EDSA Outfall of the Manila Flood Control and Drainage Project, and the "Cut-Off" of the Estero Tripa de Gallina which were all projects of the National Government. 15 The property of the Knechts was part of those expropriated under B.P. Blg. 340. In view of this Court's previous ruling in G.R. No. L-51078 16 annulling the expropriation proceedings in Civil Case No. 7001-P, the government apprised this Court of the subsequent enactment of B.P. Blg. 340. On February 12, 1990, we rendered a decision upholding the validity of B.P. Blg. 340 in G.R. No. 87335. 17

35

While G.R. No. 87335 was pending in court, on June 24, 1985, the Knechts filed Civil Case No. 2961-P before the Regional Trial Court, Branch 119, Pasay City. 18 They prayed for reconveyance, annulment of the tax sale and the titles of the Babieras and Sangalangs. The Knechts based their action on lack of the required notices to the tax sale. In the same case, Salem filed on September 26, 1985 a petition for appointment of a receiver. The court granted the petition and on November 7, 1985, appointed Metropolitan Bank and Trust Company as receiver. The Knechts questioned this appointment on a petition for certiorari before the Court of Appeals in CA-G.R. SP No. 08178. The Court of Appeals dismissed the petition which this Court affirmed in G.R. No. 75609 on January 28, 1987. Meanwhile, Civil Case No. 2961-P proceeded before Branch 119. The Knechts presented their evidence. They, however, repeatedly requested for postponements. 19 At the hearing of September 13, 1988, they and their counsel failed to appear. Accordingly, the trial court dismissed the case for "apparent lack of interest of plaintiffs" . . . "considering that the case had been pending for an unreasonable length of time." 20 The Knechts moved to set aside the order of dismissal. The motion was denied for late filing and failure to furnish a copy to the other parties. 21 The Knechts questioned the order of dismissal before the Court of Appeals. The appellate court sustained the trial court. They elevated the case to this Court in G.R. No. 89862. The petition was denied for late payment of filing fees and for failure to sufficiently show any reversible error 22. On January 17, 1990, the petition was denied with finality 23 and entry of judgment was made on February 19, 1990.
24

Three (3) months later, on May 15, 1990, the Republic of the Philippines, through the Solicitor General, filed before the Regional Trial Court, Branch 111, Pasay City Civil Case No. 7327 "[f]or determination of just compensation of lands expropriated under B.P. Blg. 340." 25 In its amended petition, the National Government named as defendants Salem, Maria del Carmen Roxas de Elizalde, Concepcion Cabarrus Vda. de Santos, Mila de la Rama and Inocentes de la Rama, the heirs of Eduardo Lesaca and Carmen Padilla. 26 As prayed for, the trial court issued a writ of possession on August 29, 1990. 27 The following day, August 30, seven of the eight houses of the Knechts were demolished and the government took possession of the portion of land on which the houses stood. 28 Meanwhile, Salem conveyed 5,611.92 square meters of the subject property to respondent spouses Mariano and Anacoreta Nocom for which TCT No. 130323 was issued in their names. Salem remained the owner of 2,490.69 square meters under TCT Nos. 130434 and 130435. Since the Knechts refused to vacate their one remaining house, Salem instituted against them Civil Case No. 85-263 for unlawful detainer before the Municipal Trial Court, Branch 46, Pasay City. As defense, the Knechts claimed ownership of the land and building. 29 The Municipal Trial Court, however, granted the complaint and ordered the Knechts' ejectment. Pursuant to a writ of execution, the last house of the Knechts was demolished on April 6, 1991. 30 The proceedings in Civil Case No. 7327 continued. As prayed for by Salem, the trial court issued an order on September 13, 1990 for the release of P5,763,650.00 to Salem by the Philippine National Bank (PNB) as partial payment of just compensation. 31 On June 7, 1991, the trial court issued another order to the PNB for the release of P15,000,000.00 as another partial payment to Salem. 32 On September 9, 1991, the trial court issued an order fixing the compensation of all the lands sought to be expropriated by the government. The value of the subject land was set at P28,961.00 per square meter. 33 This valuation did not include the improvements. 34 It was after these orders that the Knechts, on September 25, 1991, filed a "Motion for Intervention and to Implead Additional Parties" in Civil Case No. 7327. They followed this with a "Motion to Inhibit Respondent Judge Sayo and to Consolidate Civil Case No. 7327 with Civil Case No. 8423." Earlier, prior to the "Motion to Inhibit Respondent Judge Sayo and to Consolidate Civil Case No. 7327 with Civil Case No. 8423," the Knechts instituted Civil Case No. 8423 before the Regional Trial Court, Branch 117, Pasay City for recovery of ownership and possession of the property. On January 2, 1992, the trial court dismissed Civil Case No. 8423 on the ground of res judicata. The Knechts challenged the order of dismissal in G.R. No. 103448 before this Court. On February 5, 1992, we dismissed the Knechts' "Motion for Extension of Time to File Petition for Certiorari" for non-compliance with Circular No. 1-88 35 and for late filing of the Petition. 36 Entry of judgment was made on May 21, 1992. 37 In Civil Case No. 7327, the trial court issued an order on April 14, 1992 denying the Knechts' "Motion for Intervention and to Implead Additional Parties." The court did not rule on the "Motion to Inhibit Respondent Judge Sayo and to Consolidate Civil Case No. 7327 with Civil Case No. 8423," declaring it moot and academic. On April 23, 1992, as prayed for by Mariano Nocom, the trial court ordered the release of P11,526,000.00 as third installment for his 5,611.92 square meters of the subject land. The Knechts questioned the release of this amount before the Court of Appeals in CA-G.R. SP No. 27817. The Knechts later amended their petition to limit their cause of action to a review of the order of April 14, 1992 which denied their "Motion for Intervention and to Implead Additional Parties." On March 5, 1993, the Court of Appeals dismissed the petition in CA-G.R. SP No. 27817 and denied the Knechts' intervention in Civil Case No. 7327 after finding that the Knechts had no legal interest on the subject property after the dismissal of Civil Case No. 2961-P. Hence the petition in G.R. No. 109234. On June 9, 1992, while CA-G.R. SP No. 27817 was pending, the Knechts instituted also before the Court of Appeals an original action for annulment of judgment of the trial courts. This case was docketed as CA-G.R. SP No. 28089. Therein, the Knechts challenged the validity of the orders of the land registration courts in the two petitions of the Sangalangs and Babieras for registration 38, the reconveyance case 39 and the just compensation proceedings. 40 The Knechts questioned the validity of the validity of the titles of the Babieras and Sangalangs, and those of Salem and the Nocoms, and prayed for the issuance of new titles in their names. They also sought to restrain further releases of payment of just compensation to Salem and the Nocoms in Civil Case No. 7327.

36

The Court of Appeals dismissed the petition for lack of merit on November 24, 1992. Hence the filing of G.R. No. 108015. In a Resolution dated February 1, 1993, we denied the petition finding "no reversible error" committed by the Court of Appeals. The Knechts moved for reconsideration. Pending a resolution of this Court on the Knechts' motion for reconsideration, respondents Nocom moved for consolidation of the two actions. 41 We granted the motion. In their petition in G.R. No. 109234, the Knechts alleged that: I THE COURT OF APPEALS COMMITTED A REVERSIBLE ERROR OF LAW IN HOLDING THAT CIVIL CASE NO. 7327 IS NOT AN EMINENT DOMAIN PROCEEDING; II THE COURT OF APPEALS COMMITTED A REVERSIBLE ERROR OF LAW IN HOLDING THAT RES JUDICATA HAS SET IN TO BAR THE MOTION FOR INTERVENTION; III THE COURT OF APPEALS COMMITTED A REVERSIBLE ERROR OF LAW IN NOT ORDERING RESPONDENT JUDGE TO RULE ON THE MOTION FOR INHIBITION. 42 In their Motion for Reconsideration in G.R. No. 108015, the Knechts reiterate that: I THE COURT OF APPEALS COMMITTED A REVERSIBLE ERROR OF LAW IN HOLDING THAT THE PETITION FOR ANNULMENT OF JUDGMENT IS BARRED BY RES JUDICATA; II THE COURT OF APPEALS COMMITTED A REVERSIBLE ERROR OF LAW IN UPHOLDING THE DEFENSE OF RES JUDICATA EVEN AS ITS APPLICATION INVOLVES THE SACRIFICE OF JUSTICE TO TECHNICALITY. 43 We rule against the petitioners. In its decision, the Court of Appeals held that the Knechts had no right to intervene in Civil Case No. 7327 for lack of any legal right or interest in the property subject of expropriation. The appellate court declared that Civil Case No. 7327 was not an expropriation proceeding under Rule 67 of the Revised Rules of Court but merely a case for the fixing of just compensation. 44 The Knechts' right to the land had been foreclosed after they failed to redeem it one year after the sale at public auction. Whatever right remained on the property vanished after Civil Case No. 2961-P, the reconveyance case, was dismissed by the trial court. Since the petitions questioning the order of dismissal were likewise dismissed by the Court of Appeals and this Court, the order of dismissal became final and res judicata on the issue of ownership of the land. 45 The Knechts urge this Court, in the interest of justice, to take a second look at their case. They claim that they were deprived of their property without due process of law. They allege that they did not receive notice of their tax delinquency and that the Register of Deeds did not order them to surrender their owner's duplicate for annotation of the tax lien prior to the sale. Neither did they receive notice of the auction sale. After the sale, the certificate of sale was not annotated in their title nor in the title with the Register of Deeds. In short, they did not know of the tax delinquency and the subsequent proceedings until 1983 when they received the orders of the land registration courts in LRC Cases Nos. 2636-P and 2652-P filed by the Babieras and Sangalangs. 46 This is the reason why they were unable to redeem the property. It has been ruled that the notices and publication, as well as the legal requirements for a tax delinquency sale, are mandatory; 47 and the failure to comply therewith can invalidate the sale. 48 The prescribed notices must be sent to comply with the requirements of due process. 49 The claim of lack of notice, however, is a factual question. This Court is not a trier of facts. Moreover, this factual question had been raised repeatedly in all the previous cases filed by the Knechts. These cases have laid to rest the question of notice and all the other factual issues they raised regarding the property. Res judicata had already set in. Res judicata is a ground for dismissal of an action. 50 It is a rule that precludes parties from relitigating issues actually litigated and determined by a prior and final judgment. It pervades every well-regulated system of jurisprudence, and is based upon two grounds embodied in various maxims of the common law one, public policy and necessity, that there should be a limit to litigation; 51 and another, the individual should not be vexed twice for the same cause. 52 When a right of fact has been judicially tried and determined by a court of competent jurisdiction, or an opportunity for such trial has been given, the judgment of the court, so long as it remains unreversed, should be conclusive upon the parties and those in privity with them in law or estate. 53 To follow a contrary doctrine would subject the public peace and quiet to the will and neglect of individuals and prefer the gratification of the litigious disposition of the parties to the preservation of the public tranquility. 54 Res judicata applies when: (1) the former judgment or order is final; (2) the judgment or order is one on the merits; (3) it was rendered by a court having jurisdiction over the subject matter and the parties; (4) there is between the first and second actions, identity of parties, of subject matter and of cause of action. 55 Petitioners claim that Civil Case No. 2961-P is not res judicata on CA-G.R. SP No. 28089. They contend that there was no judgment on the merits in Civil Case No. 2961-P, i.e., one rendered after a consideration of the evidence or stipulations submitted by the parties at the trial of the case. 56 They stress that Civil Case No. 2961-P was dismissed upon petitioners' failure to appear at several hearings and was based on "lack of interest."

37

We are not impressed by petitioners' contention. "Lack of interest" is analogous to "failure to prosecute." Section 3 of Rule 17 of the Revised Rules of Court provides: Sec. 3. Failure to Prosecute. If plaintiff fails to appear at the time of the trial, or to prosecute his action for an unreasonable length of time, or to comply with these rules or any order of the court, the action may be dismissed upon motion of the defendant or upon the court's own motion. This dismissal shall have the effect of an adjudication upon the merits, unless otherwise provided by court. An action may be dismissed for failure to prosecute in any of the following instances: (1) if the plaintiff fails to appear at the time of trial; or (2) if he fails to prosecute the action for an unreasonable length of time; or (3) if he fails to comply with the Rules of Court or any order of the court. Once a case is dismissed for failure to prosecute, this has the effect of an adjudication on the merits and is understood to be with prejudice to the filing of another action unless otherwise provided in the order of dismissal. 57 In other words, unless there be a qualification in the order of dismissal that it is without prejudice, the dismissal should be regarded as an adjudication on the merits and is with prejudice. 58 Prior to the dismissal of Civil Case No. 2961-P, the Knechts were presenting their evidence. They, however, repeatedly requested for postponements and failed to appear at the last scheduled hearing. This prompted Salem to move for dismissal of the case. The court ordered thus: ORDER It appearing that counsel for the plaintiff has been duly notified of today's hearing but despite notice failed to appear and considering that this case has been pending for quite a considerable length of time, on motion of counsel for the defendant Salem Investment joined by Atty. Jesus Paredes for the defendant City of Pasay, for apparent lack of interest of plaintiffs, let their complaint be DISMISSED. As prayed for, let this case be reset to September 29, 1988 at 8:30 in the morning for the reception of evidence of defendant's Salem Investment on its counterclaim. SO ORDERED. 59 The order of dismissal was based on the following factors: (1) pendency of the complaint for a considerable length of time; (2) failure of counsel to appear at the scheduled hearing despite notice; and (3) lack of interest of the petitioners. Under Section 3, Rule 17, a dismissal order which does not provide that it is without prejudice to the filing of another action is understood to be an adjudication on the merits. Hence, it is one with prejudice to the filing of another action. The order of dismissal was questioned before the Court of Appeals and this Court. The petitions were dismissed and the order affirming dismissal became final in February 1990. Since the dismissal order is understood to be an adjudication on the merits, then all the elements of res judicata have been complied with. Civil Case No. 2961-P is therefore res judicata on the issue of ownership of the land. The Knechts contend, however, that the facts of the case do not call for the application of res judicata because this amounts to "a sacrifice of justice to technicality." We cannot sustain this argument. It must be noted that the Knechts were given the opportunity to assail the tax sale and present their evidence on its validity in Civil Case No. 2961-P, the reconveyance case. Through their and their counsel's negligence, however, this case was dismissed. They filed for reconsideration, but their motion was denied. The Court of Appeals upheld this dismissal. We affirmed the dismissal not on the basis of a mere technicality. This Court reviewed the merits of petitioners' case and found that the Court of Appeals committed no reversible error in its questioned judgment. 60 After years of litigation and several cases raising essentially the same issues, the Knechts cannot now be allowed to avoid the effects of res judicata. 61 Neither can they be allowed to vary the form of their action or adopt a different method of presenting their case to escape the operation of the principle. 62 To grant what they seek will encourage endless litigations and forum-shopping. Hence, the Court of Appeals correctly dismissed CA-G.R. SP No. 28089. We find, however, that the Court of Appeals erred in declaring that Civil Case No. 7327 was not an expropriation case. It was precisely in the exercise of the state's power of eminent domain under B.P. Blg. 340 that expropriation proceedings were instituted against the owners of the lots sought to be expropriated. B.P. Blg. 340 did not, by itself, lay down the procedure for expropriation. The law merely described the specific properties expropriated and declared that just compensation was to be determined by the court. It designated the then Ministry of Public Works and Highways as the administrator in the "prosecution of the project." Thus, in the absence of a procedure in the law for expropriation, reference must be made to the provisions on eminent domain in Rule 67 of the Revised Rules of Court. Section 1 of Rule 67 of the Revised Rules of Court provides: Sec. 1. The complaint. The right of eminent domain shall be exercised by the filing of a complaint which shall state with certainty the right and purpose of condemnation, describe the real or personal property sought to be condemned, and join as defendants all persons owning or claiming to own, or occupying, any part thereof or interest therein, showing, so far as practicable, the interest of each defendant separately. If the title to any property sought to be condemned appears to be in the Republic of the Philippines, although occupied by private individuals, or if the title is otherwise obscure or doubtful so that the plaintiff cannot with accuracy or certainty specify who are the real owners, averment to that effect may be made in the complaint. The power of eminent domain is exercised by the filing of a complaint which shall join as defendants all persons owning or claiming to own, or occupying, any part

38

of the expropriated land or interest therein. 63 If a known owner is not joined as defendant, he is entitled to Intervene in the proceeding; or its he is joined but not served with process and the proceeding is already closed before he came to know of the condemnation, he may maintain an independent suit for damages. 64 The defendants in an expropriation case are not limited to the owners of the property condemned. They include all other persons owning, occupying or claiming to own the property. When a parcel of land is taken by eminent domain, the owner of the fee is not necessarily the only person who is entitled to compensation. 65 In the American jurisdiction, the term "owner" when employed in statutes relating to eminent domain to designate the persons who are to be made parties to the proceeding, refers, as is the rule in respect of those entitled to compensation, to all those who have lawful interest in the property to be condemned, 66 including a mortgagee, 67 a lessee 68 and a vendee in possession under an executory contract. 69 Every person having an estate or interest at law or in equity in the land taken is entitled to share in the award. 70 If a person claiming an interest in the land sought to be condemned is not made a party, he is given the right to intervene and lay claim to the compensation. 71 The Knechts insist that although they were no longer the registered owners of the property at the time Civil Case No. 7327 was filed, they still occupied the property and therefore should have been joined as defendants in the expropriation proceedings. When the case was filed, all their eight (8) houses were still standing; seven (7) houses were demolished on August 29, 1990 and the last one on April 6, 1991. They claim that as occupants of the land at the time of expropriation, they are entitled to a share in the just compensation. Civil Case No. 7327, the expropriation case, was filed on May 15, 1990. Four months earlier, in January 1990, Civil Case No. 2961-P for reconveyance was dismissed with finality by this Court and judgment was entered in February 1990. The Knechts lost whatever right or colorable title they had to the property after we affirmed the order of the trial court dismissing the conveyance case. The fact that the Knechts remained in physical possession cannot give them another cause of action and resurrect an already settled case. The Knechts' possession of the land and buildings was based on their claim of ownership, 72 not on any juridical title such as a lessee, mortgagee, or vendee. Since the issue of ownership was put to rest in Civil Case No. 2961-P, it follows that their physical possession of the property after the finality of said case was bereft of any legality and merely subsisted at the tolerance of the registered owners. 73 This tolerance ended when Salem filed Civil Case No. 85-263 for unlawful detainer against the Knechts. As prayed for, the trial court ordered their ejectment and the demolition of their remaining house. Indeed, the Knechts had no legal interest in the property by the time the expropriation proceedings were instituted. They had no right to intervene and the trial court did not err in denying their "Motion for Intervention and to Implead Additional Parties." Their intervention having been denied, the Knechts had no personality to move for the inhibition of respondent Judge Sayo from the case. The Court of Appeals therefore did not err in dismissing CA-G.R. SP No. 27817. IN VIEW WHEREOF, the Petition in G.R. No. 109234 is dismissed and the Motion for Reconsideration in G.R. No. 108015 is denied. The decisions of the Court of Appeals in CA-G.R. SP No. 27817 and CA-G.R. SP No. 28089 are affirmed. SO ORDERED. Regalado, Melo, Mendoza and Martinez, JJ., concur.

39

8.

Republic of the Philippines SUPREME COURT Manila THIRD DIVISION

G.R. No. L-61570 February 12, 1990. RUPERTO FULGADO, substituted by his heirs, JULIANA, JOSE, MAXIMO, PACITA and SEVERO all surnamed FULGADO, petitioners, vs. HON. COURT OF APPEALS, RUFINO CUSTODIO, SIMPLICIA CUSTODIO, ARSENIO PIGUING, ISMAEL PORCIUNCULA and DOMINGA MACARULAY, respondents. Dollete, Blanco, Ejercito & Associates for petitioners. Ramon Tuangco for private respondents.

FERNAN, C.J.:

On September 9,1967, Ruperto Fulgado, a man approaching the twilight of his life, undertook the arduous task of filing an action in the Court of First Instance of Riz against Rufino Custodia, Simplicia Custodia, Arsenio Piguing, Ismael Porciuncula and Dominga Macarulay for the annulment of certain contracts of sale and partition The defendants (herein private respondents) filed their answer to the complaint with special and affirmative defenses and a counterclaim.

After several deferments, the pre-trial conference was finally set for February 1, 1968 at 8:30 in the morning. Private respondents and their counsel failed to appear trial and were subsequently declared as in default. Plaintiff Fulgado was then allowed to present his evidence ex parte before the Deputy Clerk of Court.

Meanwhile, upon learning of their predicament, private respondents immediately filed a motion to lift the order of default on the same day that the order was issue denied said motion in its order of February 16, 1972. Their motion for reconsideration was also denied. Persistently, respondents filed a petition for relief from the more, this was denied.

On April 24, 1972, the trial court rendered a decision in favor of plaintiff Ruperto Fulgado. On appeal, however, the Court of Appeals found that private respondents of their day in court by the unjust denial of their motion to lift the order of default. 2 The Appellate Court, in no less than explicit terms, said:

WHEREFORE, the decision of the court a quo is hereby set aside and the case is remanded to the court of origin for trial on the me defendants the opportunity to present their evidence, provided, however, that the evidence already presented before the commis but with the right of the defendants to cross-examine the witness who had already testified and with the right of the plaintiff to pr evidence that then he may decide. Without costs. 3 The Court of Appeals' decision became final and executory on June 27,1974 and the records of the case were remanded to the trial court.

On July 3, 1975, or more than a year after the finality of the Appellate Court's decision, counsel for private respondents moved that the trial court "include th(e) cas August and September calendar of the Court, at the usual hour in the morning." 4

The case was set for hearing on September 16,1975. Unfortunately, the presiding judge went on official leave and the hearing was postponed anew to January 15 a 1976. In the meantime, plaintiff Ruperto Fulgado died on November 25,1975 and was substituted by his children as party plaintiffs. Fulgado's witness, Jose Fulgado, dispositive part of the Appellate Court's judgment, had earlier migrated to the United States on September 16, 1974. When the case was heard on May 4, 1976, the following proceedings transpired:

40

Atty Dollete:

For the plaintiff, Your Honor. If your Honor please, may I inform this Honorable Court that this is a remanded of Appeals for cross-examination or presentation by the plaintiff of any additional evidence. But we have no this case ... except those evidence already adduced in the lower court before it was appealed in the Court of the defense now to cross-examine the witnesses. Court (To Atty. Tuangco): You are through with the cross-examination? Atty. Tuangco:

Not yet, Your Honor, we were granted by the Court of Appeals the right to cross-examine the witnesses ... . T case was called for hearing by this Honorable Court, the Presiding Judge tried to make the parties come to a seems that. they could not come to such settlement. I advised my clients to try to meet them. So now, this is they could not agree and so we will be proceeding with the cross-examination of the witnesses. Atty. Dollete:

There were only two witnesses. Two witnesses were presented, one is Ruperto Fulgado and he died already. other witness was Jose Fulgado who is now abroad for almost a year, Your Honor. Atty. Tuangco: I understand that the other witness was here on a visit, Your Honor. He came back. Court: So, what shall we do now? Atty. Tuangco:

So, I move to strike out the testimonies of the witnesses who testified on the ground that we were deprived examine them. Atty. Dollete: We will submit, Your Honor, for resolution the motion of the defendants. Court (To Atty. Tuangco): So, what do you want? Atty. Tuangco:

That the whole testimonies of the two witnesses who were presented ex parte be stricken off the record bec been granted the right of cross-examining them and they are not available at this stage, Your Honor. Atty. Dollete:

We will submit Your Honor. We maintain, Your Honor. Our opposition is that it hinges on the fact that defen laches in their failure to cross-examine the witness. That is our opposition. Court:

41

Why? Atty. Dollete:

There were several opportunities for them to cross-examine especially the witness Ruperto Fulgado, Your Ho full knowledge of the age of this witness. They could have taken steps to assert their right granted by the Co Notwithstanding their knowledge about the age, the advanced age and health condition of this witness Rupe we maintain, Your Honor, that defendants, in a way, have committed laches in the assertion of their right to Atty. Tuangco:

The records will show Your Honor, that it was the defendants who moved to set this case for hearing upon th records from the Court of Appeals. Court:

You make a written motion and I will grant you a period of ten (10) days within which to file an opposition an additional period of ten (10) days within which to reply. Then this matter shall be deemed submitted for reso is clear now that plaintiff has no more additional evidence. Atty. Dollete: Yes, Your Honor. Court:

So that in case the court favorably grants the motion of defendants and orders the striking out of the testimo Fulgado and the other witness, together with the documentary evidence, the plaintiff had no more evidence Atty. Dollete: Yes, Your Honor. We stand on the evidence on Record. 5 On June 30, 1976, the trial court issued an order dismissing the case. It decreed:

For reason stated in the defendants' motion filed on May 18, 1976, which the Court finds meritorious, the testimonies of plaintiffs Fulgado and Jose Fulgado, who were not presented by the plaintiff so that the defendants could cross-examine them on May 4, 19 the record and, as a consequence, in view of the manifestation of plaintiffs counsel that he had no more witnesses to present, the is dismissed without pronouncement as to costs. 6 On appeal to the Appellate Court in C.A. G.R No. 62353-R, said order was affirmed on June 30, 1982. 7 Petitioners now question said affirmance before this Court in for review.

The principal issue in the case at bar is the propriety of the exclusion of the testimonies given by the now deceased Ruperto Fulgado and his witness, Jose Fulgado, w the United States, which resulted in the dismissal of the complaint. Private respondents maintain that such testimonies are wholly inadmissible for being hearsay, b were not able to cross-examine the witnesses.

Petitioners, on the other hand, contend that while the right to cross-examination is an essential part of due process, the same may however be waived as the privat done when they allowed an unreasonable length of time to lapse from the inception of the opportunity to cross-examine before availing themselves of such right an they failed to exhaust other remedies to secure the exercise of such right. The appeal is well-taken.

In Savory Luncheonette vs. Lakas ng Manggagawang Pilipino, 8 and the cases cited thereunder, the Court, speaking through Justice Muoz Palma, has provided us w overview of the right to cross-examination as a vital element of due process. Thus:

The right of a party to confront and cross-examine opposing witnesses in a judicial litigation, be it criminal or civil in nature, or in p

42

administrative tribunals with quasi-judicial powers, is a fundamental right which is part of due process. However, the right is a pers be waived expressly or impliedly by conduct amounting to a renunciation of the right of cross-examination. Thus, where a party ha opportunity to cross-examine a witness but failed to avail himself of it, he necessarily forfeits the right to cross-examine and the te direct examination of the witness will be received or allowed to remain in the record.

The conduct of a party which may be construed as an implied waiver of the right to cross-examine may take various forms. But the principle underlying the application of the rule on implied waiver is that the party was given the opportunity to confr ont and cross opposing witness but failed to take advantage of it for reasons attributable to himself alone.

The principle requiring a testing of testimonial statements by cross-examination has always been understood as requiring, not necessarily an actual cross-examinati opportunity to exercise the right to cross-examine if desired. 9 Thus the resolution of the present case would hinge on whether or not this was an opportunity for cr

There is no disputing that where there was no such opportunity (to cross examine) and the want of it was caused by the party offering (plaintiff), the testimony sho However, where the failure to obtain cross-examination was imputable to the cross examiner's fault, the lack of cross-examination is no longer a ground for exclusio general principle that an opportunity, though waived, will suffice. 10

From the records presented, it is manifest that private respondents had enough opportunity to cross-examine plaintiff Ruperto Fulgado before his death, and Jose F migration to the United States. Conceding that private respondents lost their standing in court during the time they were in default, they were no longer in that situ 1974 when the Court of Appeals set aside the default judgment in CA-G.R. No. 42590-R and remanded the case to the court of origin for trial on the merits, "grantin the opportunity to present their evidence ... ." 11 This was a positive signal for them to proceed with the cross-examination of the two Fulgados, a right previously w when they were considered in default. But despite knowledge of Ruperto's failing health (he was then 89 years of age) and Jose's imminent travel to the United Stat respondents did not move swiftly and decisively. They tarried for more than one year from the finality of the Appellate Court's decision on June 27, 1974 to ask the 1975 to set the already much delayed case for hearing "in any date of August and September ... ." 12

Such inaction on the part of private respondents cannot be easily dismissed by the argument that it is the duty of the plaintiff to always take the initiative in keeping "alive." At best, the argument is fatuous.

The task of recalling a witness for cross examination is, in law, imposed on the party who wishes to exercise said right. This is so because the right, being personal an intention to utilize it must be expressed. Silence or failure to assert it on time amounts to a renunciation thereof. Thus, it should be the counsel for the opposing pa to cross-examine plaintiffs witnesses. It is absurd for the plaintiff himself to ask the court to schedule the cross-examination of his own witnesses because it is not h ensure that his deponents are cross-examined. Having presented his witnesses, the burden shifts to his opponent who must now make the appropriate move. Indee placing the burden of the case on plaintiffs shoulders can be construed to extremes as what happened in the instant proceedings.

Having had the liberty to cross-examine and having opted not to exercise it, the case is then the same in effect as if private respondent had actually cross-examined that it was gross error for both the trial court and the Appellate Court to dismiss the complaint in Civil Case No. 10256 on the ultimate ground that there was an alle examination. The wholesale exclusion of testimonies was too inflexible a solution to the procedural impasse because it prejudiced the party whose only fault during proceedings was to die before he could be cross-examined. The prudent alternative should have been to admit the direct examination so far as the loss of cross-exa been shown to be not in that instance a material loss. 13 And more compellingly so in the instant case where it has become evident that the adverse party was afford chance for cross-examination but through his own fault failed to cross-examine the witness.

Where death prevents cross-examination under such circumstances that no responsibility of any sort can be ascribed to the plaintiff or his witness, it seems a harsh out all that has been obtained in the direct examination. 14

As to the witness Jose Fulgado who is reportedly abroad, private respondents could have resorted to the various modes of discovery under the Rules of Court to cro During the hearing of May 4, 1976, counsel for private respondents unwittingly or wittingly disclosed that they knew that Jose was in the country "for a visit" but th effort to have him subpoenaed. Altogether, the acts of private respondents constitute a waiver, and consequently, a forfeiture of their right to cross-examination. And having failed to make use of consequences should rightfully fall on them and not on their adversary.

WHEREFORE, the decision under review of the Court of Appeals in CA-G.R. No. 62353-R dated June 30, 1982 is SET ASIDE. The trial court is ordered to REINSTATE Ci and to allow the direct testimonies of plaintiff Ruperto Fulgado and his witness Jose Fulgado to remain in the record. The court is further ordered to give priority to case in view of the length of time that it has remained unresolved on account of procedural differences. This judgment is immediately executory. No costs. Gutierrez, Jr., Feliciano, Bidin and Cortes, JJ., concur.

43

lawphil

9.

Republic of the Philippines SUPREME COURT Manila SECOND DIVISION

G.R. No. 127198

May 16, 2005

LAND BANK OF THE PHILIPPINES, petitioner, vs. HON. ELI G. C. NATIVIDAD, Presiding Judge of the Regional Trial Court, Branch 48, San Fernando, Pampanga, and JOSE R. CAGUIAT represented by Attorneys-in-fact JOSE T. BARTOLOME and VICTORIO MANGALINDAN, respondents. DECISION TINGA, J.:

This is a Petition for Review1 dated December 6, 1996 assailing the Decision2 of the Regional Trial Court3 dated July 5, 1996 which ordered the Department of Agrarian Reform (DAR) a petitioner Land Bank of the Philippines (Land Bank) to pay private respondents the amount of P30.00 per square meter as just compensation for the States acquisition of private respondents properties under the land reform program. The facts follow.

On May 14, 1993, private respondents filed a petition before the trial court for the determination of just compensation for their agricultural lands situated in Arayat, Pampanga, whic were acquired by the government pursuant to Presidential Decree No. 27 (PD 27). The petition named as respondents the DAR and Land Bank. With leave of court, the petition was amended to implead as co-respondents the registered tenants of the land. After trial, the court rendered the assailed Decision the dispositive portion of which reads:

WHEREFORE, judgment is hereby rendered in favor of petitioners and against respondents, ordering respondents, particularly, respondents Department of Agrarian Reform and the Land Bank of the Philippines, to pay these lands owned by petitioners and which are the subject of acquisition by the State under its la reform program, the amount of THIRTY PESOS (P30.00) per square meter, as the just compensation due for payment for same lands of petitioners located at Sa Vicente (or Camba), Arayat, Pampanga.

Respondent Department of Agrarian Reform is also ordered to pay petitioners the amount of FIFTY THOUSAND PESOS (P50,000.00) as Attorneys Fee, and to pa the cost of suit. SO ORDERED.4

DAR and Land Bank filed separate motions for reconsideration which were denied by the trial court in its Order5 dated July 30, 1996 for being pro forma as the same did not contain a notice of hearing. Thus, the prescriptive period for filing an appeal was not tolled. Land Bank consequently failed to file a timely appeal and the assailed Decision became final and executory. Land Bank then filed a Petition for Relief from Order Dated 30 July 1996,6 citing excusable negligence as its ground for relief. Attached to the petition for relief were two affidavits of merit claiming that the failure to include in the motion for reconsideration a notice of hearing was due to accident and/or mistake.7 The affidavit of Land Banks counsel of record

44

notably states that "he simply scanned and signed the Motion for Reconsideration for Agrarian Case No. 2005, Regional Trial Court of Pampanga, Branch 48, not knowing, or unmindf that it had no notice of hearing"8 due to his heavy workload. The trial court, in its Order9 of November 18, 1996, denied the petition for relief because Land Bank lost a remedy in law due to its own negligence.

In the instant petition for review, Land Bank argues that the failure of its counsel to include a notice of hearing due to pressure of work constitutes excusable negligence and does no make the motion for reconsideration pro forma considering its allegedly meritorious defenses. Hence, the denial of its petition for relief from judgment was erroneous.

According to Land Bank, private respondents should have sought the reconsideration of the DARs valuation of their properties. Private respondents thus failed to exhaust administrative remedies when they filed a petition for the determination of just compensation directly with the trial court. Land Bank also insists that the trial court erred in declaring that PD 27 and Executive Order No. 228 (EO 228) are mere guidelines in the determination of just compensation, and in relying on private respondents evidence of the valuation of t properties at the time of possession in 1993 and not on Land Banks evidence of the value thereof as of the time of acquisition in 1972.

Private respondents filed a Comment10 dated February 22, 1997, averring that Land Banks failure to include a notice of hearing in its motion for reconsideration due merely to couns heavy workload, which resulted in the motion being declared pro forma, does not constitute excusable negligence, especially in light of the admission of Land Banks counsel that he been a lawyer since 1973 and has "mastered the intricate art and technique of pleading." Land Bank filed a Reply11 dated March 12, 1997 insisting that equity considerations demand that it be heard on substantive issues raised in its motion for reconsideration. The Court gave due course to the petition and required the parties to submit their respective memoranda.12 Both parties complied.13 The petition is unmeritorious. At issue is whether counsels failure to include a notice of hearing constitutes excusable negligence entitling Land Bank to a relief from judgment. Section 1, Rule 38 of the 1997 Rules of Civil Procedure provides:

Sec. 1. Petition for relief from judgment, order, or other proceedings.When a judgment or final order is entered, or any other proceeding is thereafter taken against a party in any court through fraud, accident, mistake, or excusable negligence, he may file a petition in such court and in the same case praying that the judgment, order or proceeding be set aside. As can clearly be gleaned from the foregoing provision, the remedy of relief from judgment can only be resorted to on grounds of fraud, accident, mistake or excusable negligence. Negligence to be excusable must be one which ordinary diligence and prudence could not have guarded against. 14

Measured against this standard, the reason profferred by Land Banks counsel, i.e., that his heavy workload prevented him from ensuring that the motion for reconsideration include notice of hearing, was by no means excusable.

Indeed, counsels admission that "he simply scanned and signed the Motion for Reconsideration for Agrarian Case No. 2005, Regional Trial Court of Pampanga, Branch 48, not knowin or unmindful that it had no notice of hearing" speaks volumes of his arrant negligence, and cannot in any manner be deemed to constitute excusable negligence.

The failure to attach a notice of hearing would have been less odious if committed by a greenhorn but not by a lawyer who claims to have "mastered the intricate art and technique o pleading."15 Indeed, a motion that does not contain the requisite notice of hearing is nothing but a mere scrap of paper. The clerk of court does not even have the duty to accept it, much less to bring it to the attention of the presiding judge.16 The trial court therefore correctly considered the motion for reconsideration pro forma. Thus, it cannot be faulted for denying Land Banks motion for reconsideration and petition for relief from judgment.

It should be emphasized at this point that procedural rules are designed to facilitate the adjudication of cases. Courts and litigants alike are enjoined to abide strictly by the rules. Wh in certain instances, we allow a relaxation in the application of the rules, we never intend to forge a weapon for erring litigants to violate the rules with impunity. The liberal interpretation and application of rules apply only in proper cases of demonstrable merit and under justifiable causes and circumstances. While it is true that litigation is not a game o technicalities, it is equally true that every case must be prosecuted in accordance with the prescribed procedure to ensure an orderly and speedy administration of justice. Party litigants and their counsel are well advised to abide by, rather than flaunt, procedural rules for these rules illumine the path of the law and rationalize the pursuit of justice.17 Aside from ruling on this procedural issue, the Court shall also resolve the other issues presented by Land Bank, specifically as regards private respondents alleged failure to exhaust administrative remedies and the question of just compensation. Land Bank avers that private respondents should have sought the reconsideration of the DARs valuation instead of filing a petition to fix just compensation with the trial court.

45

The records reveal that Land Banks contention is not entirely true. In fact, private respondents did write a letter18 to the DAR Secretary objecting to the land valuation summary submitted by the Municipal Agrarian Reform Office and requesting a conference for the purpose of fixing just compensation. The letter, however, was left unanswered prompting private respondents to file a petition directly with the trial court. At any rate, in Philippine Veterans Bank v. Court of Appeals,19 we declared that there is nothing contradictory between the DARs primary jurisdiction to determine and adjudicate agrarian reform matters and exclusive original jurisdiction over all matters involving the implementation of agrarian reform, which includes the determination of questions of just compensation, and the original and exclusive jurisdiction of regional trial courts over all petitions for the determination of just compensation. The first refers to administrative proceedings, while the second refers to judicial proceedings.

In accordance with settled principles of administrative law, primary jurisdiction is vested in the DAR to determine in a preliminary manner the just compensation for the lands taken under the agrarian reform program, but such determination is subject to challenge before the courts. The resolution of just compensation cases for the taking of lands under agrarian reform is, after all, essentially a judicial function.20 Thus, the trial did not err in taking cognizance of the case as the determination of just compensation is a function addressed to the courts of justice.

Land Banks contention that the property was acquired for purposes of agrarian reform on October 21, 1972, the time of the effectivity of PD 27, ergo just compensation should be based on the value of the property as of that time and not at the time of possession in 1993, is likewise erroneous. In Office of the President, Malacaang, Manila v. Court of Appeals, we ruled that the seizure of the landholding did not take place on the date of effectivity of PD 27 but would take effect on the payment of just compensation.

Under the factual circumstances of this case, the agrarian reform process is still incomplete as the just compensation to be paid private respondents has yet to be settled. Considering the passage of Republic Act No. 6657 (RA 6657)22 before the completion of this process, the just compensation should be determined and the process concluded under the said law. Indeed, RA 6657 is the applicable law, with PD 27 and EO 228 having only suppletory effect, conformably with our ruling in Paris v. Alfeche.23 Section 17 of RA 6657 which is particularly relevant, providing as it does the guideposts for the determination of just compensation, reads as follows:

Sec. 17. Determination of Just Compensation.In determining just compensation, the cost of acquisition of the land, the current value of like properties, its nature, actual use and income, the sworn valuation by the owner, the tax declarations, and the assessment made by government assessors shall be considered The social and economic benefits contributed by the farmers and the farm-workers and by the Government to the property as well as the non-payment of taxe or loans secured from any government financing institution on the said land shall be considered as additional factors to determine its valuation. It would certainly be inequitable to determine just compensation based on the guideline provided by PD 27 and EO 228 considering the DARs failure to determine the just compensation for a considerable length of time. That just compensation should be determined in accordance with RA 6657, and not PD 27 or EO 228, is especially imperative considering that just compensation should be the full and fair equivalent of the property taken from its owner by the expropriator, the equivalent being real, substantial, full and ample.24

In this case, the trial court arrived at the just compensation due private respondents for their property, taking into account its nature as irrigated land, location along the highway, market value, assessors value and the volume and value of its produce. This Court is convinced that the trial court correctly determined the amount of just compensation due private respondents in accordance with, and guided by, RA 6657 and existing jurisprudence. WHEREFORE, the petition is DENIED. Costs against petitioner. SO ORDERED. Puno, (Chairman), Austria-Martinez, Callejo, Sr., and Chico-Nazario, JJ., concur

10. Philippine Press Insitute v. Comelec

Phil. Press Institute, Inc. v. Comelec 244 SCRA 272 Facts: Petition for Certiorari and Prohibition with prayer for the issuance of a Temporary Restraining Order. PPI, a non-stock, non-profit organization of newspaper and magazine publishers, asks us to declare Comelec Resolution No. 2772 unconstitutional and void on the ground that it violates the prohibition imposed by the Constitution upon the government, and any of its agencies, against the taking of private property for public use without just compensation. Petitioner also contends that the 22 March 1995 letter directives of Comelec requiring publishers to give free Comelec Space and at the

46

same time process raw data to make it camera-ready, constitute impositions of involuntary servitude, contrary to the provisions of Section 18 (2), Article III of the 1987 Constitution. Finally, PPI argues that Section 8 of Comelec Resolution No. 2772 is violative of the constitutionally guaranteed freedom of speech, of the press and of expression. On the other hand, The Office of the Solicitor General filed its Comment on behalf of respondent Comelec alleging that Comelec Resolution No. 2772 does not impose upon the publishers any obligation to provide free print space in the newspapers as it does not provide any criminal or administrative sanction for non-compliance with that Resolution. According to the Solicitor General, the questioned Resolution merely established guidelines to be followed in connection with the procurement of Comelec space, the procedure for and mode of allocation of such space to candidates and the conditions or requirements for the candidates utilization of the Comelec space procured. At the same time, however, the Solicitor General argues that even if the questioned Resolution and its implementing letter directives are viewed as mandatory, the same would nevertheless be valid as an exercise of the police power of the State. The Solicitor General also maintains that Section 8 of Resolution No. 2772 is a permissible exercise of the power of supervision or regulation of the Comelec over the communication and information operations of print media enterprises during the election period to safeguard and ensure a fair, impartial and credible election. Issue: Whether or not Resolution No. 2772 issued by respondent Commission on Elections is valid. Held: Petition for Certiorari and Prohibition is GRANTED in part and Section 2 of Resolution No. 2772 in its present form and the related letter-directives dated 22 March 1995 are hereby SET ASIDE as null and void, and the Temporary Restraining Order is hereby MADE PERMANENT. The Petition is DISMISSED in part, to the extent it relates to Section 8 of Resolution No. 2772. No pronouncement as to costs. Section 2 of Resolution No. 2772, in its present form and as interpreted by Comelec in its 22 March 1995 letter directives, purports to require print media enterprises to donate free print space to Comelec. As such, Section 2 suffers from a fatal constitutional vice and must be set aside and nullified. To the extent it pertains to Section 8 of Resolution No. 2772, the Petition for Certiorari and Prohibition must be dismissed for lack of an actual, justiciable case or controversy.