EMINENT DOMAIN

Athena Jeunnesse Mae Martinez Tria

1. Moday v. Court of appeals, 268 scra 368 (1997)

FACTS:

• On July 23, 1989, the Sangguniang Bayan of the Municipality of Bunawan in Agusan del Sur passed
Resolution No. 43-89,

“Authorizing the Municipal Mayor to Initiate the Petition for Expropriation of a One (1) Hectare Portion of Lot No.
6138-Pls-4 Along the National Highway Owned by Percival Moday for the Site of Bunawan Farmers Center and
Other Government Sports Facilities.

• In due time, Resolution No. 43-89 was approved by then Municipal Mayor Anuncio C. Bustillo and
transmitted to the Sangguniang Panlalawigan for its approval

• Sangguniang Panlalawigan disapproved said Resolution and returned it with the comment that
“expropriation is unnecessary considering that there are still available lots in Bunawan for the establishment of
the government center.”

• The Municipality of Bunawan, herein public respondent, subsequently filed a Petition for Eminent
Domain against petitioner Percival Moday before the RTC

• , public respondent municipality filed a Motion to Take or Enter Upon the Possession of Subject Matter
of This Case stating that it had already deposited with the municipal treasurer the necessary amount in
accordance with Section 2, Rule 67 of the Revised Rules of Court and that it would be in the government’s best
interest for public respondent to be allowed to take possession of the property

• the Regional Trial Court granted respondent municipality’s motion to take possession of the land

o that the Sangguniang Panlalawigan’s failure to declare the resolution invalid leaves it effective.

o that the duty of the Sangguniang Panlalawigan is merely to review the ordinances and resolutions
passed by the Sangguniang Bayan under the old LGC

o that the exercise of eminent domain is not one of the two acts enumerated in Section 19 thereof
requiring the approval of the Sangguniang Panlalawigan

CA upheld the trial court. Meanwhile, the Municipality of Bunawan had erected three buildings on the subject
property.

ISSUE: whether a municipality may expropriate private property by virtue of a municipal resolution which was
disapproved by the Sangguniang Panlalawigan.

HELD: YES.

Eminent domain, the power which the Municipality of Bunawan exercised in the instant case, is a fundamental
State power that is inseparable from sovereignty. It is government’s right to appropriate, in the nature of a
compulsory sale to the State, private property for public use or purpose. Inherently possessed by the national
legislature the power of eminent domain may be validly delegated to local governments, other public entities and
public utilities. For the taking of private property by the government to be valid, the taking must be for public use
and there must be just compensation

The Municipality of Bunawan’s power to exercise the right of eminent domain is not disputed as it is expressly
provided for in Batas Pambansa Blg. 337, the Local Government Code 18 in force at the time expropriation
proceedings were initiated. Section 9 of said law states:.
“Section 9.Eminent Domain. — A local government unit may, through its head and acting pursuant to a resolution
of its sanggunian, exercise the right of eminent domain and institute condemnation proceedings for public use or
purpose.”

POLITICAL LAW; LOCAL GOVERNMENT CODE (B.P. 337); POWER OF THE SANGGUNIANG
PANLALAWIGAN TO REVIEW ORDINANCES, RESOLUTIONS AND EXECUTIVE ORDERS PROMULGATED
BY THE MUNICIPAL MAYOR; DECLARATION OF INVALIDITY MUST BE ON THE SOLE GROUND THAT IT
IS BEYOND THE POWER OF THE SANGGUNIAN BAYAN OR MAYOR TO ISSUE THE RESOLUTION,
ORDINANCE OR ORDER UNDER REVIEW. — The Sangguniang Panlalawigan’s disapproval of Municipal
Resolution No. 43-89 is an infirm action which does not render said resolution null and void. The law, as
expressed in Section 153 of B.P. BLG. 337, grants the Sangguniang Panlalawigan the power to declare a
municipal resolution invalid on the sole ground that it is beyond the power of the Sangguniang Bayan or the
Mayor to issue. Although pertaining to a similar provision of law but different factual milieu then obtaining, the
Court’s pronouncements in Velazco vs. Blas, where we cited significant early jurisprudence, are applicable to the
case at bar. “The only ground upon which a provincial board may declare any municipal resolution, ordinance, or
order invalid is when such resolution, ordinance, or order is ‘beyond the powers conferred upon the council or
president making the same.’ Absolutely no other ground is recognized by the law. A strictly legal question is
before the provincial board in its consideration of a municipal resolution, ordinance, or order. The provincial
(board’s) disapproval of any resolution, ordinance, or order must be premised specifically upon the fact that such
resolution, ordinance, or order is outside the scope of the legal powers conferred by law. If a provincial board
passes these limits, it usurps the legislative functions of the municipal council or president. Such has been the
consistent course of executive authority.” Thus, the Sangguniang Panlalawigan was without the authority to
disapprove Municipal Resolution No. 43-89 for the Municipality of Bunawan clearly has the power to exercise the
right of eminent domain and its Sangguniang Bayan the capacity to promulgate said resolution, pursuant to the
earlier-quoted Section 9 of B.P. Blg. 337. Perforce, it follows that Resolution No. 43-89 is valid and binding and
could be used as lawful authority to petition for the condemnation of petitioners’ property.

2. Sps. Yasay v. CA GR. 156684

Overview:

In this case, the Mandaluyong City adopted a resolution authorizing the City Mayor to expropriate a
parcel of land belonging to the herein petitioners. The petitioners were alarmed. Before the City
Mayor could take the necessary steps for the expropriation of the land, petitioners filed a petition
for certiorari and prohibition in the RTC against the Sanguniang Panglungsod of Mandaluyong.
Will the petition prosper? Are the petitioners aggrieved, considering no expropriation proceeding
took place?

Facts proper:

The petitioners owned a parcel of land with an area of 1,044 square meters situated between Nueve
de Febrero Street and Fernandez Street in Barangay Mauway, Mandaluyong City. On October 2,
1997, the Sangguniang Panglungsod of Mandaluyong City adopted Resolution No. 552, Series of
1997, to authorize then City Mayor Benjamin S. Abalos, Sr. to take the necessary legal steps for
the expropriation of the land of the petitioners for the purpose of developing it for low cost housing
for the less privileged but deserving city inhabitants.

Notwithstanding that the enactment of Resolution No. 552 was but the initial step in the City’s
exercise of its power of eminent domain granted under Section 19 of the Local Government Code
of 1991, the petitioners became alarmed, and filed a petition for certiorari and prohibition in the
RTC, praying for the annulment of Resolution No. 552 due to its being unconstitutional,
confiscatory, improper, and without force and effect.

On January 31, 2001, the RTC ruled in favor of the City and dismissed the petition for lack of merit,
opining that certiorari did not lie against a legislative act of the City Government. However, on
 February 19, 2002, the RTC, acting upon the petitioners’ motion for reconsideration, set aside its
decision and declared that Resolution No. 552 was null and void. The RTC held that the petition
was not premature because the passage of Resolution No. 552 would already pave the way for
the City to deprive the petitioners and their heirs of their only property.

Aggrieved, the City appealed to the CA.

In its decision promulgated on October 18, 2002, the CA concluded that the reversal of the January
31, 2001 decision by the RTC was not justified because Resolution No. 552 deserved to be
accorded the benefit of the presumption of regularity and validity absent any sufficient showing to
the contrary.

The petitioners moved for reconsideration, but the CA denied their motion. Thus, they appeal to the
Court

Issue:

1. WON A MERE RESOLUTION OF SANGGUNIANG PANGLUNGSOD IS SUFFIECIENT FOR THE

PURPOSE OF INITIATING AN EXPROPRIATION PROCEEDING
2. WON AN ACTION FOR PROHIBITION WILL LIE AGAINST EXPROPRIATION.

1. NO.

A resolution like Resolution No. 552 that merely expresses the sentiment of the Sangguniang
Panglungsod is not sufficient for the purpose of initiating an expropriation proceeding. Indeed, in
Municipality of Parañaque v. V.M. Realty Corporation,12 a case in which the Municipality of
Parañaque based its complaint for expropriation on a resolution, not an ordinance, the Court
ruled so: (PLEASE SEE DIGESTED CASE OF PARANAQUE VS VM REALTY, THE RULING
HERE IS COPIED FROM IT IN TOTO).

2. NO

Prohibition does not lie against eminent domain – Verily, there can be no prohibition against a
procedure whereby the immediate possession of the land under expropriation proceedings may
be taken, provided always that due provision is made to secure the prompt adjudication and
payment of just compensation to the owner. This bar against prohibition comes from the nature of
the power of eminent domain as necessitating the taking of private land intended for public use,
and the interest of the affected landowner is thus made subordinate to the power of the State.
Once the State decides to exercise its power of eminent domain, the power of judicial review
becomes limited in scope, and the courts will be left to determine the appropriate amount of just
compensation to be paid to the affected landowners. Only when the landowners are not given
their just compensation for the taking of their property or when there has been no agreement on
the amount of just compensation may the remedy of prohibition become available.

Here, however, the remedy of prohibition was not called for, considering that only a resolution
expressing the desire of the Sangguniang Panglungsod to expropriate the petitioners’ property
was issued. As of then, it was premature for the petitioners to mount any judicial challenge, for
the power of eminent domain could be exercised by the City only through the filing of a verified
complaint in the proper court. Before the City as the expropriating authority filed such verified
complaint, no expropriation proceeding could be said to exist. Until then, the petitioners as the
owners could not also be deprived of their property under the power of eminent domain.

WHEREFORE, we affirm the decision promulgated on October 18, 2002 in CA-G.R. SP No.
70618.
3. Rp V.PLDT 26 scra 620 (scra)

FACTS: Public petitioner commenced a suit against private respondent praying for the right of the
Bureau of Telecommunications to demand interconnection between the Government Telephone
System and that of PLDT, so that the Government Telephone System could make use of the lines
and facilities of the PLDT. Private respondent contends that it cannot be compelled to enter into a
contract where no agreement is had between them.

ISSUE: Whether or not interconnection between PLDT and the Government Telephone System
can be a valid object for expropriation.

HELD: Yes, in the exercise of the sovereign power of eminent domain, the Republic may require
the telephone company to permit interconnection as the needs of the government service may
require, subject to the payment of just compensation. The use of lines and services to allow
inter-service connection between the both telephone systems, through expropriation can be a
subject to an easement of right of way.

4. NIA v. Rural Bank GR. 185124

FACTS:

NIA is a government-owned-and-controlled corporation created under R.A. 3601. It is primarily responsible for
irrigation development and management in the country. To carry out its purpose, NIA was specifically
authorized under P.D. 552 to exercise the power of eminent domain.

NIA needed some parcels of land for the purpose of constructing the Malitubog-Marigadao Irrigation Project.
On 08 September 1994, it filed with the RTC of Kabacan, Cotabato a Complaint for the expropriation of a
portion of three (3) parcels of land covering a total of 14,497.91 square meters.

NIA filed a Second Amended Complaint to allege properly the area sought to be expropriated, the exact address
of the expropriated properties and the owners thereof. NIA further prayed that it be authorized to take
immediate possession of the properties after depositing with the Philippine National Bank the amount of
₱19,246.58 representing the provisional value thereof.

Respondents filed their Answer with Affirmative and Special Defenses and Counterclaim. They alleged that
NIA had no authority to expropriate portions of their land, because it was not a sovereign political entity;
that it was not necessary to expropriate their properties, because there was an abandoned government
property adjacent to theirs, where the project could pass through; that Lot No. 3080 was no longer owned
by the Rural Bank of Kabacan; that NIAs valuation of their expropriated properties was inaccurate because
of the improvements on the land that should have placed its value at ₱5 million; and that NIA never
negotiated with the landowners before taking their properties for the project, causing permanent and
irreparable damages to their properties valued at ₱250,000.

ISSUE/S
1. WON THE FINDING OF JUST COMPENSATION OF THE LAND AND THE IMPROVEMENTS
THEREON BASED ON THE REPORT OF THE COMMISSIONERS IS CORRECT.

2. WON THE PAYMENT OF JUST COMPENSATION FOR LOT NO. 3080 SHOULD BE MADE TO
RESPONDENTS MARGARITA TABOADA AND PORTIA CHARISMA RUTH ORTIZ.

HELD​:
WHEREFORE​, the Petition is ​PARTLY GRANTED​. The 12 August 2008 CA Decision in CA-G.R. CV No.
65196, awarding just compensation to the defendants as owners of the expropriated properties and deleting
the inclusion of the value of the excavated soil, is hereby ​AFFIRMED with ​MODIFICATION​. The case
is hereby ​REMANDED to the trial court for the reception of evidence to establish the present owner of Lot
No. 3080.

RATIO:

On the first issue, in expropriation proceedings, just compensation is defined as the full and fair equivalent of
the property taken from its owner by the expropriator. The commissioners properly determined the just
compensation to be awarded to the landowners whose properties were expropriated by petitioner.
The records show that the trial court dutifully followed the procedure under Rule 67 of the 1997
Rules of Civil Procedure when it formed a committee that was tasked to determine the just compensation
for the expropriated properties. The first set of committee members made an ocular inspection of the
properties, subject of the expropriation. They also determined the exact areas affected, as well as the kinds
and the number of improvements on the properties. When the members were unable to agree on the
valuation of the land and the improvements thereon, the trial court selected another batch of disinterested
members to carry out the task of determining the value of the land and the improvements.
The new committee members even made a second ocular inspection of the expropriated areas. They also
obtained data from the BIR to determine the zonal valuation of the expropriated properties, interviewed the
adjacent property owners, and considered other factors such as distance from the highway and the nearby
town center.Further, the committee members also considered Provincial Ordinance No. 173, which was
promulgated by the Province of Cotabato on 15 June 1999, and which provide for the value of the
properties and the improvements for taxation purposes.

We can readily deduce from these established facts that the committee members endeavored a rigorous process
to determine the just compensation to be awarded to the owners of the expropriated properties. We cannot,
as petitioner would want us to, oversimplify the process undertaken by the committee in arriving at its
recommendations, because these were not based on mere conjectures and unreliable data.

On the second issue, the Petition is meritorious.

The CA affirmed the ruling of the trial court, which had awarded the payment of just compensation
intended for Lot No. 3080 registered in the name of the Rural Bank of Kabacan to the
defendants-intervenors on the basis of the non-participation of the rural bank in the proceedings and the
latters subsequent Manifestation that it was no longer the owner of that lot. The appellate court erred on this
matter.
It should be noted that eminent domain cases involve the expenditure of public funds. In this kind of
proceeding, we require trial courts to be more circumspect in their evaluation of the just compensation to be
awarded to the owner of the expropriated property. Thus, it was imprudent for the appellate court to rely on
the Rural Bank of Kabacans mere declaration of non-ownership and non-participation in the expropriation
proceeding to validate defendants-intervenors claim of entitlement to that payment.
The law imposes certain legal requirements in order for a conveyance of real property to be valid. It
should be noted that Lot No. 3080 is a registered parcel of land covered by TCT No. T-61963. In order for
​
the reconveyance of real property to be valid, the conveyance must be embodied in a public document and
registered in the office of the Register of Deeds where the property is situated.
We have scrupulously examined the records of the case and found no proof of conveyance or
evidence of transfer of ownership of Lot No. 3080 from its registered owner, the Rural Bank of Kabacan, to
defendants-intervenors. As it is, the TCT is still registered in the name of the said rural bank. It is not
disputed that the bank did not participate in the expropriation proceedings, and that it manifested that it no
longer owned Lot No. 3080. The trial court should have nevertheless required the rural bank and the
defendants-intervenors to show proof or evidence pertaining to the conveyance of the subject lot. The court
 cannot rely on mere inference, considering that the payment of just compensation is intended to be awarded
solely owner based on the latters proof of ownership.

5. Republic Vs. Castelvi 58 SCRA 336 (1974)

FACTS: After the owner of a parcel of land that has been rented and occupied by the government in
1947 refused to extend the lease, the latter commenced expropriation proceedings in 1959. During
the assessment of just compensation, the government argued that it had taken the property when
the contract of lease commenced and not when the proceedings begun. The owner maintains that
the disputed land was not taken when the government commenced to occupy the said land as
lessee because the essential elements of the “taking” of property under the power of eminent
domain, namely (1) entrance and occupation by condemnor upon the private property for more
than a momentary period, and (2) devoting it to a public use in such a way as to oust the owner
and deprive him of all beneficial enjoyment of the property, are not present.

ISSUE: Whether or not the taking of property has taken place when the condemnor has entered
and occupied the property as lesse.

HELD: No, the property was deemed taken only when the expropriation proceedings commenced
in 1959.

The essential elements of the taking are: (1) Expropriator must enter a private property, (2) for
more than a momentary period, (3) and under warrant of legal authority, (4) devoting it to public
use, or otherwise informally appropriating or injuriously affecting it in such a way as (5)
substantially to oust the owner and deprive him of all beneficial enjoyment thereof.

In the case at bar, these elements were not present when the government entered and occupied the
property under a contract of lease.

Regz Luancing Gibson

6. ​City Govt. Of Quezon City vs Ericta 122 SCRA 759 (1983)

Facts​: ​An ordinance was promulgated in Quezon city which approved the the regulation of
establishment of private cemeteries in the said city. According to the ordinance, 6% of the total area
of the private memorial park shall be set aside for charity burial of deceased persons who are
paupers and have been residents of QC. Himlayang Pilipino, a private memorial park, contends that
the taking or confiscation of property restricts the use of property such that it cannot be used for any
reasonable purpose and deprives the owner of all beneficial use of his property. It also contends that
the taking is not a valid exercise of police power, since the properties taken in the exercise of police
power are destroyed and not for the benefit of the public.

Issue​: Whether or not the ordinance made by Quezon City is a valid taking of private property?

HELD​: No, the ordinance made by Quezon City is not a valid way of taking private property.
There is no reasonable relation between the setting aside of at least six (6) percent of the total
area of an private cemeteries for charity burial grounds of deceased paupers and the promotion
of health, morals, good order, safety, or the general welfare of the people. The ordinance is
actually a taking without compensation of a certain area from a private cemetery to benefit
paupers who are charges of the municipal corporation. Instead of building or maintaining a public
cemetery for this purpose, the city passes the burden to private cemeteries.

State's exercise of the power of expropriation requires payment of just compensation. Passing
the ordinance without benefiting the owner of the property with just compensation or due
process, would amount to unjust taking of a real property. Since the property that is needed to
be taken will be used for the public's benefit, then the power of the state to expropriate will come
forward and not the police power of the state.

7. City of Manila v. Laguio GR 118127 Apr. 12 2005

FACTS​: Private respondent Malate Tourist Development Corporation (MTDC) is a corporation
engaged in the business of operating hotels, motels, hostels and lodging houses. It built and opened
Victoria Court in Malate which was licensed as a motel although duly accredited with the DOT as a
hotel. On 28 June 1993, MTDC filed a Petition for Declaratory Relief with Prayer for a Writ of
Preliminary Injunction and/or Temporary Restraining Order7 with the lower court impleading as
defendants, herein petitioners City of Manila, Hon. Alfredo S. Lim (Lim), Hon. Joselito L. Atienza, and
the members of the City Council of Manila (City Council). MTDC prayed that the Ordinance, insofar
as it includes motels and inns as among its prohibited establishments, be declared invalid and
unconstitutional.

Enacted by the City Council and approved by petitioner City Mayor, the said Ordinance is entitled–
AN ORDINANCE PROHIBITING THE ESTABLISHMENT OR OPERATION OF BUSINESSES
PROVIDING CERTAIN FORMS OF AMUSEMENT, ENTERTAINMENT, SERVICES AND
FACILITIES IN THE ERMITA-MALATE AREA, PRESCRIBING PENALTIES FOR VIOLATION
THEREOF, AND FOR OTHER PURPOSES.

Judge Laguio rendered the assailed Decision (in favour of respondent).

ISSUE​: WON the ordinance is unconstitutional.

HELD​: The Court is of the opinion, and so holds, that the lower court did not err in declaring the
Ordinance, as it did, ultra vires and therefore null and void.

The tests of a valid ordinance are well established. A long line of decisions has held that for an
ordinance to be valid, it must not only be within the corporate powers of the local government unit to
enact and must be passed according to the procedure prescribed by law, it must also conform to the
following substantive requirements:
(1) must not contravene the Constitution or any statute;
(2) must not be unfair or oppressive;
(3) must not be partial or discriminatory;
(4) must not prohibit but may regulate trade;
(5) must be general and consistent with public policy; and
(6) must not be unreasonable.

The enactment of the Ordinance was an invalid exercise of delegated power as it is unconstitutional
and repugnant to general laws.The police power granted to LGUs must always be exercised with
utmost observance of the rights of the people to due process and equal protection of the law. Due
process requires the intrinsic validity of the law in interfering with the rights of the person to his life,
liberty and property.

Requisites for the valid exercise of Police Power are not met: To successfully invoke the exercise of
police power as the rationale for the enactment of the Ordinance, and to free it from the imputation of
constitutional infirmity, not only must it appear that the interests of the public generally, as
distinguished from those of a particular class, require an interference with private rights, but the
means adopted must be reasonably necessary for the accomplishment of the purpose and not unduly
oppressive upon individuals.60 It must be evident that no other alternative for the accomplishment of
the purpose less intrusive of private rights can work. A reasonable relation must exist between the
purposes of the police measure and the means employed for its accomplishment, for even under the
guise of protecting the public interest, personal rights and those pertaining to private property will not
be permitted to be arbitrarily invaded.

Lacking a concurrence of these two requisites, the police measure shall be struck down as an
arbitrary intrusion into private rights a violation of the due process clause.

It is readily apparent that the means employed by the Ordinance for the achievement of its purposes,
the governmental interference itself, infringes on the constitutional guarantees of a person’s
fundamental right to liberty and property.

Modality employed is unlawful taking.​ It is an ordinance which permanently restricts the use of
property that it can not be used for any reasonable purpose goes beyond regulation and must be
recognized as a taking of the property without just compensation.78 It is intrusive and violative of the
private property rights of individuals.

There are two different types of taking that can be identified. A “possessory” taking occurs when the
government confiscates or physically occupies property. A “regulatory” taking occurs when the
government’s regulation leaves no reasonable economically viable use of the property.

What is crucial in judicial consideration of regulatory takings is that government regulation is a taking
if it leaves no reasonable economically viable use of property in a manner that interferes with
reasonable expectations for use. When the owner of real property has been called upon to sacrifice
all economically beneficial uses in the name of the common good, that is, to leave his property
economically idle, he has suffered a taking.

The Ordinance gives the owners and operators of the “prohibited” establishments three (3) months
from its approval within which to “wind up business operations or to transfer to any place outside of
the Ermita-Malate area or convert said businesses to other kinds of business allowable within the
area.” The directive to “wind up business operations” amounts to a closure of the establishment, a
permanent deprivation of property, and is practically confiscatory. Unless the owner converts his
establishment to accommodate an “allowed” business, the structure which housed the previous
business will be left empty and gathering dust. It is apparent that the Ordinance leaves no reasonable
economically viable use of property in a manner that interferes with reasonable expectations for use.
The second and third options to transfer to any place outside of the Ermita-Malate area or to convert
into allowed businessesare confiscatory as well. The penalty of permanent closure in cases of
subsequent violations found in Section 4 of the Ordinance is also equivalent to a “taking” of private
property.
Petitioners cannot therefore order the closure of the enumerated establishments without infringing the
due process clause. These lawful establishments may be regulated, but not prevented from carrying
on their business.

8. RP (NAPOCOR) v Heirs of Borbon CA

FACTS: N​APOCOR entered a property located in Barangay San Isidro, Batangas City in order to
construct and maintain transmission lines for the 230 KV Mahabang Parang-Pinamucan Power
Transmission Project. Respondents heirs of Saturnino Q. Borbon owned the property.
NAPOCOR filed a COMPLAINT in the RTC-Batangas seeking an acquisition of an easement of
right of way over a portion of the property involving an area of only 6,326 square meters, more or
less, alleging that it had negotiated with the respondents for the acquisition of the easement but
they had failed to reach any agreement; and that, nonetheless, it was willing to deposit the
amount of ₱9,790.00 representing the assessed value of the portion sought to be expropriated.

The respondents staunchly maintained that NAPOCOR had not negotiated with them before
entering the property and that the entry was done without their consent in the process, destroying
some fruit trees without payment, and installing five transmission line posts and five woodpoles for
its project; that the area being expropriated only covered the portion directly affected by the
transmission lines; that the remaining portion of the property was also affected because the
transmission line passed through the center of the land, thereby dividing the land into three lots;
that the presence of the high tension transmission line had rendered the entire property inutile for
any future use and capabilities;that, nonetheless, they tendered no objection to NAPOCOR’s entry
provided it would pay just compensation not only for the portion sought to be expropriated but for
the entire property whose potential was greatly diminished, if not totally lost, due to the project;and
that their property was classified as industrial land.

PRE-TRIAL was conducted and the parties stipulated on the location, number of heirs, names of
the person upon whom title to the property was issued, and the ownership & possession of the
property.RTC constituted the panel of 3 commissioners. the RTC ordered NAPOCOR to pay the
respondents: (1) just compensation for the whole area of 14,257 square meters at the rate of
₱550.00/square meter; (2) legal rate of interest from May 5, 1995 until full payment; and (3) the
costs of suit. On appeal, CA affirmed the RTC’s decision.

ISSUE: ​Whether or not the expropriation proceedings should be discontinued or dismissed

pending appeal?

HELD:​The dismissal of the proceedings for expropriation at the instance of NAPOCOR is proper,
but, conformably with Section 4,Rule 67 of the Rules of Court, the dismissal or discontinuance of
the proceedings must be upon such terms as the court deems just and equitable. Public use is the
fundamental basis for the action for expropriation; hence, NAPOCOR’s motion to discontinue the
proceedings is warranted and should be granted.

The right of eminent domain is "the ultimate right of the sovereign power to appropriate, not only
the public but the private property of all citizens within the territorial sovereignty, to public
purpose."But the exercise of such right is not unlimited, for two mandatory requirements should
underlie the Government’s exercise of the power of eminent domain, namely: (1) that it is for a
particular public purpose; and (2) that just compensation be paid to the property owner.These
requirements partake the nature of implied conditions that should be complied with to enable the
condemnor to keep the property expropriated.

In Asia's Emerging Dragon Corporation v. Department of Transportation and

Communications,Justice Corona, in his dissenting opinion said that: To be valid, the taking must
be for public use. The meaning of the term "public use" has evolved over time in response to
changing public needs and exigencies. Public use which was traditionally understood as strictly
limited to actual "use by the public" has already been abandoned. "Public use" has now been held
to be synonymous with "public interest," "public benefit," and "public convenience." It is essential
that the element of public use of the property be maintained throughout the proceedings for
expropriation.

The right of eminent domain is the right which the Government or the people retains over the
estates of individuals to resume them for public use. It is the right of the people, or the sovereign,
to dispose, in case of public necessity and for the public safety, of all the wealth contained in the
state.Indeed, public use is the fundamental basis for the action for expropriation; hence,
NAPOCOR’s motion to discontinue the proceedings is warranted and should be granted.

In the present case the petitioner admits that the expropriation of the land in question is no longer
necessary for public use. Had that admission been made in the trial court the case should have
been dismissed there. It now appearing positively, by resolution of the plaintiff, that the
expropriation is not necessary for public use, the action should be dismissed even without a
motion on the part of the plaintiff. The moment it appears in whatever stage of the proceedings that
the expropriation is not for a public use the complaint should be dismissed and all the parties
thereto should be relieved from further annoyance or litigation.
In this case, NAPOCOR seeks to discontinue the expropriation proceedings on the ground that the
transmission lines constructed on the respondents’ property had already been retired. Verily, the
retirement of the transmission lines necessarily stripped the expropriation proceedings of the
element of public use. To continue with the expropriation proceedings despite the definite
cessation of the public purpose of the project would result in the rendition of an invalid judgment in
favor of the expropriator due to the absence of the essential element of public use.

the Court grants the motion to discontinue the proceedings, and requires the return of the property
to the respondents. Having said that, we must point out that NAPOCOR entered the property
without the owners’ consent and without paying just compensation to the respondents. Neither did
it deposit any amount as required by law prior to its entry. Considering that in the process of
installing transmission lines, NAPOCOR destroyed some fruit trees and plants without payment,
and the installation of the transmission lines went through the middle of the land as to divide the
property into three lots, thereby effectively rendering the entire property inutile for any future use, it
would be unfair for NAPOCOR not to be made liable to the respondents for the disturbance of their
property rights from the time of entry until the time of restoration of the possession of the property.

Wherefore, the Court DISMISSES the expropriation proceedings due to the intervening cessation
of the need for public use

9. Nopocor vs Gutierrez 193 SCRA

FACTS:​ ​National Power Corporation, a government owned and controlled entity, in accordance
with Commonwealth Act No. 120, is invested with the power of eminent domain for the purpose
of pursuing its objectives, which among others is the construction, operation, and maintenance
of electric transmission lines for distribution throughout the Philippines. For the construction of its
230 KV Mexico-Limay transmission lines, plaintiff's lines have to pass the lands belonging to
defendants Matias Cruz, Heirs of Natalia Paule and spouses Misericordia Gutierrez and Ricardo
Malit.

Plaintiff initiated negotiations for the acquisition of right of way easements over the
aforementioned lots for the construction of its transmission lines but unsuccessful in this regard,
said corporation was constrained to file eminent domain proceedings. Upon filing of the
corresponding complaint, plaintiff corporation deposited the amount of P973.00 with the
Provincial Treasurer of Pampanga, tendered to cover the provisional value of the land of the
defendant spouses Ricardo Malit and Misericordia Gutierrez. And by virtue of which, the plaintiff
corporation was placed in possession of the property of the defendant spouses so it could
immediately proceed with the construction of its Mexico-Limay 230 KV transmission line. In this
connection, by the trial court's order of September 30, 1965, the defendant spouses were
authorized to withdraw the fixed provisional value of their land in the sum of P973.00.

ISSUE​: Whether or not petitioner should be made to pay simple easement fee or full
compensation for the land traversed by its transmission lines?

HELD:​ The resolution of this case hinges on the determination of whether the acquisition of a
mere right-of-way is an exercise of the power of eminent domain contemplated by law.​ 1âwphi1

The trial court's observation shared by the appellate court show that ". . . While it is true that plaintiff are (sic) only after a right-of-way easement, it nevertheless perpetually deprives defendants of their proprietary rights as manifested by the imposition by the plaintiff upon defendants that below said transmission lines no plant higher than three (3) meters is allowed. Furthermore, because of the high-tension current conveyed through said transmission
lines, danger to life and limbs that may be caused beneath said wires cannot altogether be discounted, and to cap it all plaintiff only pays the fee to defendants once, while the latter shall continually pay the taxes due on said affected portion of their property."

The trial court's observation shared by the appellate court show that ". . . While it is true that
plaintiff are (​sic​) only after a right-of-way easement, it nevertheless perpetually deprives
defendants of their proprietary rights as manifested by the imposition by the plaintiff upon
defendants that below said transmission lines no plant higher than three (3) meters is allowed.
Furthermore, because of the high-tension current conveyed through said transmission lines,
danger to life and limbs that may be caused beneath said wires cannot altogether be discounted,
and to cap it all plaintiff only pays the fee to defendants once, while the latter shall continually
pay the taxes due on said affected portion of their property." The foregoing facts considered, the
acquisition of the right-of-way easement falls within the purview of the power of eminent domain.

the easement of right-of-way is definitely a taking under the power of eminent domain.
Considering the nature and effect of the installation of the 230 KV Mexico-Limay transmission
lines, the limitation imposed by NPC against the use of the land for an indefinite period deprives
private respondents of its ordinary use.

Private respondents recognize the inherent power of eminent domain being exercised by NPC
when it finally consented to the expropriation of the said portion of their land, subject however to
payment of just compensation. No matter how laudable NPC's purpose is, for which
expropriation was sought, it is just and equitable that they be compensated the fair and full
equivalent for the loss sustained, which is the measure of the indemnity, not whatever gain
would accrue to the expropriating entity.It appearing that the trial court did not act capriciously
and arbitrarily in setting the price of P5.00 per square meter of the affected property, the said
award is proper and not unreasonable.

WHEREFORE, the assailed decision of the Court of Appeals is AFFIRMED.

10. NAPOCOR VS San pedro gr. No. 170945

 FACTS: ​Petitioner for the construction of its Transmission Line and Tower negotiated with respondents for an
easement right of way over her property. Respondent executed a Right of Way Grant in favor of NP. The
payment voucher for the residential portion for the lot valued was the processed. However, NPC Board of
Directors approved Board Resolution stating that it would pay only for easement over agricultural lands, adopt
median or average if there are several amounts involved.

NPC filed a complaint for eminent domain in the RTC against Maria and other landowners. According to
NPC, in order to construct and maintain its Northwestern Luzon Transmission Line Project it was necessary to
acquire several lots for an easement of right of way.

The RTC rendered judgement, declaring as well-grounded, fair and reasonable the compensation for the
property. NPC appealed the amended decision to the CA, asserting that the RTC gravely erred in the fixing of
just compensation for Respondents. The CA rendered judgement dismissing the appeal.

ISSUE: ​Whether or not the right of way easement resulting to the deprivation og use of the property is
considered taking?

HELD: ​YES. the right of way easement resulting in a restriction or limitation on property rights over the land
traversed by transmission lines, as in the present case, also falls within the ambit of the term “expropriation”.
While it is true that petitioner only after a right of way easement, it nevertheless perpetually deprives
respondents of their property rights as manifested by the imposition by the petitioner upon respondents that
below said transmission lines. Normally, the power of eminent domain results in the taking or appropriation of
title to, and possession of, the expropriated property, but no cogent reason appears why said power may not be
availed of to impose only a burden upon the owner of condemned property, without loss of title and
possession. It is unquestionable that real property may, through expropriation, be subjected to an easement
right of way.

11. US V. CAUSBY 328 U.S 256 (1946)

Facts:
Respondents own 2.8 acres near an airport outside of Greensboro, North Carolina.
Respondents’ property contained a house and a chicken farm. The end of one of the runways of the
airport was 2,220 feet from Respondents’ property, and the glide path passed over the property at 83
feet, which is 67 feet above the house, 63 feet above the barn, and 18 feet above the highest tree. The
use by the United States of this airport is pursuant to a lease beginning June 1, 1942, and ending June
30, 1942, with provisions for renewal until June 30, 1967, or six months after the end of the national
emergency, whichever is earlier. The United States’ four motored bombers make loud noises when
flying above the property, and have very bright lights. Respondents’ chicken farm production had to
stop, because 150 chickens were killed by flying into walls from fright. In the Court of Claims, it was
found that the United States had taken an easement over the property on June 1, 1942, and that the
value of the property depreciation as the result of the easement was $2,000.00. The United States
petitioned for certiorari, which was granted.

Issue:
Whether the Respondents’ property been taken within the meaning of the Fifth Amendment?

Held:
 Yes. But the case is remanded for a determination of the value of the easement and whether
the easement was permanent or temporary.
The court noted the common law doctrine of ownership of land extending to the sky above
the land. However, the court notes that an act of Congress had given the United States exclusive
national sovereignty over the air space. The court noted that common sense made the common law
doctrine inapplicable.
However, the court found that the common law doctrine did not control the present case. The
United States had conceded in oral argument that if flights over the Respondents’ property rendered it
uninhabitable then there would be a taking compensable under the Fifth Amendment. The measure of
the value of the property taken is the owner’s loss, not the taker’s gain.
The airspace is a public highway. But it is obvious that if the landowner is to have the full
enjoyment of his land, he must have exclusive control of the immediate reaches of the enveloping
atmosphere. If this were not true then landowners could not build buildings, plant trees or run fences.
The airspace, apart from the immediate reaches above the land, is part of the public domain. The court
does not set the precise limits of the line of demarcation. Flights over private land are not a taking,
unless, like here, they are so low and frequent as to be a direct and immediate interference with the
enjoyment of the land. The Court of Claims must, upon remand, determine the value of the easement
and whether it is a temporary or permanent easement.

12. PPI V. COMELEC 244 SCRA 272 (1995)

Facts:
COMELEC issued resolution 2772 directing newspapers to provide provide free print space of not
less than one half (1/2) page for use as “Comelec Space” which shall be allocated by the Commission,
free of charge, among all candidates within the area in which the newspaper, magazine or periodical
is circulated to enable the candidates to make known their qualifications, their stand on public issues
and their platforms and programs of government. Philippine Press Institute, a non-stock, non-profit
organization of newspaper and magazine publishers asks the Court to declare said resolution
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.

The Office of the Solicitor General, on behalf of Comelec alleged that the resolution does not impose
upon the publishers any obligation to provide free print space in the newspapers. It merely established
guidelines to be followed in connection with the procurement of “Comelec space”. And if it is viewed
as mandatory, the same would nevertheless be valid as an exercise of the police power of the State- 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 the resolution was a valid exercise of the power of eminent domain?

Held:
The Supreme Court declared the Resolution as unconstitutional. It held that to compel print media
companies to donate “Comelec space” amounts to “taking” of private personal property without
payment of the just compensation required in expropriation cases. The threshold requisites for a
lawful taking of private property for public use are the necessity for the taking and the legal authority
to effect the taking. The element of necessity for the taking has not been established by respondent
Comelec considering that the newspapers were not unwilling to sell advertising space. The taking of
private property for public use is authorized by the constitution, but not without payment of just
compensation. Also Resolution No. 2772 does not constitute a valid exercise of the police power of
the state. In the case at bench, there is no showing of existence of a national emergency to take private
property of newspaper or magazine publishers.

However, Sec 8 still stands as it is within the power of COMELEC to control the media influences of
candidates to prevent unequal campaigns.

13. Republic v Sps Llamas (Illegal Taking of Subdivision Roads) Jan 25, 2017

Facts:
On April 23, 1990, the Department of Public Works and Highways initiated an action for
expropriation for the widening of Dr. A. Santos Ave. (also known as Sucat Road) in what was then
the Municipality of Parañaque, Metro Manila. This action was brought against 26 defendants, none of
whom are respondents in this case.
On November 2, 1993, the Commissioners appointed by the Regional Trial Court in the
expropriation case submitted a resolution recommending that just compensation for the expropriated
areas be set to P12,000.00 per square meter.
On January 27, 1994, the Llamas Spouses filed before the Regional Trial Court a "Most
Urgent and Respectful Motion for Leave to be Allowed Intervention as
Defendants-Intervenors-Oppositors." They claimed that they were excluded from the expropriation
case despite having properties affected by the road widening project. After a hearing on this Motion,
the Regional Trial Court allowed the Llamas Spouses to file their Answer-in-Intervention.
The Llamas Spouses filed their Answer-in-Intervention on March 21, 1994. In it, they
claimed that a total area of 298 square meters was taken from them during the road widening project.
The Llamas Spouses filed a "Most Urgent Motion for the Issuance of an Order Directing the
Immediate Payment of 40% of Zonal Value of Expropriated Land and Improvements." On December
9, 1994, the Department of Public Works and Highways filed its Comment/Opposition to the Llamas
Spouses' Motion. On May 29, 1996, the Regional Trial Court issued the Order directing the payment
of the value of the lots of the defendants in the expropriation case. After years of not obtaining a
favorable ruling, the Llamas Spouses filed a "Motion for Issuance of an Order to Pay and/or Writ of
Execution.
The Department of Public Works and Highways and the Llamas Spouses filed a Joint
Manifestation and Motion seeking to suspend the Llamas Spouses' pending Motions. In an August 8,
2005 hearing, the Department of Public Works and Highways manifested that the non-payment of the
Llamas Spouses' claims was due to their continued failure to comply with their undertaking. On the
same date, the Llamas Spouses filed a Manifestation seeking the payment of their claims. The
Department of Public Works and Highways then filed a Comment/Opposition. On October 8, 2007,
the Regional Trial Court issued the Order directing the payment to the Llamas Spouses of just
compensation. It denied payment for areas covered by TCT No. In the Order dated May 19, 2008, the
Regional Trial Court denied the Llamas Spouses' Motion for Reconsideration. The Llamas Spouses
then filed before the Court of Appeals a Petition for Certiorari. The Court of Appeals reversed and set
aside the assailed Orders of the Regional Trial Court and ordered the Department of Public Works
and Highways to pay the Llamas Spouses just compensation for a total of 237 square meters across
three (3) lots, inclusive of the portions excluded by the Regional Trial Court. The Court of Appeals
added that the amount due to the Llamas Spouses was subject to 12% interest per annum from the
time of the taking.

Issue: ​Whether or not just compensation must be paid to respondents Francisco and Carmelita Llamas
for the subdivision road lots covered by TCT No. 179165?

Ruling:
Yes. ​Petitioner's reliance on the 1991 White Plains Decision is misplaced. The same 1991
Decision was not the end of litigation relating to the widening of Katipunan Road. The owner and
developer of White Plains Subdivision, Quezon City Development and Financing Corporation
(QCDFC), went on to file motions for reconsideration. The second of these motions was granted in
this Court's July 27, 1994 Resolution. This Resolution expressly discarded the compulsion
underscored by the Department of Public Works and Highways, and the dispositive portion of the
1991 White Plains Decision was modified accordingly. As this Court recounted in its 1998 Decision
in White Plains Homeowners Association, Inc. v. Court of Appeals.
The 1998 White Plains Decision unequivocally repudiated the 1991 White Plains Decision's
allusion to a compulsion on subdivision developers to cede subdivision road lots to government, so
much that it characterized such compulsion as an "illegal taking." It did away with any preference for
government's capacity to compel cession and, instead, emphasized the primacy of subdivision owners'
and developers' freedom in retaining or disposing of spaces developed as roads.
The Department of Public Works and Highways makes no claim here that the road lots
covered by TCT No. 179165 have actually been donated to the government or that their transfer has
otherwise been consummated by respondents. It only theorizes that they have been automatically
transferred. Neither has expropriation ever been fully effected. Precisely, we are resolving this
expropriation controversy only now.
Respondents have not made any positive act enabling the City Government of Parañaque to
acquire dominion over the disputed road lots. Therefore, they retain their private character.
Accordingly, just compensation must be paid to respondents as the government takes the road lots in
the course of a road widening project.

WHEREFORE, the Petition for Review on Certiorari is DENIED. The assailed October 14,
2010 Decision of the Fifth Division of the Court of Appeals in CA-G.R. SP No. 104178 is
AFFIRMED.

14. Bartolata v. Republic GR 223534 Jan 7, 2017

FACTS:

Bartolata acquired ownership over a parcel of land by virtue of an Order of Award from the
Bureau of Lands. Subsequently, respondents acquired 223 sq. m. of petitioner’s property for the
development of the Metro Manila Skyway Project. The parties agreed that in exchange for the
acquisition, petitioner would be paid just compensation for the appraised value of the property, an
aggregate of ₱l2,265,000 for the entire affected area. Subsequently, respondents appropriated
₱l,480,000 in favor of petitioner as partial payment.
 Since the date of initial payment, petitioner continuously demanded from respondents the
balance but the latter refused to settle their outstanding obligation prompting petitioner to file a
Complaint for a sum of money.

Respondents raised that the Order of Award from the Bureau of Lands granting title to
petitioner over the subject property states that the “land shall be subject to the easement and
servitudes provided for in Section 109-114 of Commonwealth Act No. 141, as amended.” They also
then argued that pursuant to Section 112 of CA 141 the government is entitled to an easement of right
of way not exceeding 60 meters in width, without need of payment for just compensation, save for the
value of improvements existing and any payment for the government’s use of the easement, unless
made to compensate the landowner for the value of the improvements affected, is unwarranted. Thus,
they prayed, that the ₱l,480,000 partial payment made to petitioner for the acquisition of the latter’s
property, which was well within the 60-meter threshold width, be returned to the government.

Petitioner contended that PD 2004 which amended RA 730 allegedly removed the statutory
lien attached to the subject property. Respondents, however, countered that petitioner could not have
benefited from PD 2004 since the removal of restrictions and encumbrances contained in PD 2004
only applies to public land sold by the government for residential purposes without public auction,
whereas petitioner was awarded the subject property through a public auction sale.

ISSUE # 1:

Whether or not the property acquired by virtue of an Order of Award is subject easement of right of
way in favor of the government despite the enactment of PD 2004.

YES​. ​First, ​no less than the Order of Award granting petitioner title over the subject property
reads that the parcel of land conferred to him is subject to the restrictions contained under Sec.
109-114 of CA 141, which necessarily includes the easement provided in Sec. 112. Notably,
petitioner was awarded the subject property in 1987, while PD 2004, which allegedly removed all
encumbrances and restrictions from awarded properties, was signed into law much earlier in 1985.
This alone raises suspicion on the applicability of PD 2004 to the subject property.

Second, t​ he Court finds no reversible error in the RTC and CA’s interpretation of the
coverage of PD 2004 and RA 730. The title of RA 730 itself supports the rulings of the courts ​a quo
that the laws petitioner relied upon only cover the sale of public lands for residential purposes and to
qualified applicants without public auction. Xxx

x x x RA 730 was crafted as an exception to Secs. 61 and 67 of CA 141. These provisions

govern the mode of disposition of the alienable public lands enumerated under Sec. 59 of the same
law. Synthesizing the provisions, CA 141 provides that public lands under Sec. 59 can only be
disposed for residential, commercial, industrial, and other similar purposes through lease or sale, in
both cases, ​“to the highest bidder. ​” The conduct of an auction is then required under Secs. 61 and 67.
 By way of exception, however, RA 730 now allows the sale of public lands without public
auction to qualified applicants. It is through this exceptional case of purchase of public land without
public auction wherein PD 2004 would apply.

Under its plain meaning, only public lands acquired by qualified applicants without public
auction and for residential purposes are free from any restrictions against encumbrance or alienation.
The provision is inapplicable to petitioner’s property which was awarded to petitioner not in
accordance with RA 730, but through public auction.

What is more, the easement of right of way under Sec. 112 of CA 141 is not subsumed in the
phrase ​“restrictions against encumbrance or alienation” ​appearing in the amendment introduced by
PD 2004. xxx

ISSUE # 2:

Whether or not petitioner is entitled to just compensation.

NO.

The seminal case of ​Andaya l​ ikewise involved property subject to the statutory lien under
Sec. 112 of CA 141. Xxx

The Court affirmed the CA’s interpretation of Sec. 112 of CA 141 and ruled that the Republic
was under no obligation to pay therein respondent Andaya just compensation in enforcing its right of
way. Be that as it may, the Court did not foreclose the possibility of the property owner being entitled
to just compensation if the enforcement of the right of way resulted in the ​“taking” o​ f the portions not
subject to the legal easement.

Jurisprudence teaches us that ​“taking,” ​in the exercise of the power of eminent domain,
“occurs not only when the government actually deprives or dispossesses the property owner of his
property or of its ordinary use, but also when there is a practical destruction or material impairment
of the value of his property.​” xxx

To recapitulate, two elements must concur before the property owner will be entitled to just
compensation for the remaining property under Sec. 112 of CA 141: (1) that the remainder is not
subject to the statutory lien of right of way; and (2) that the enforcement of the right of way results in
the practical destruction or material impairment of the value of the remaining property, or in the
property owner being dispossessed or otherwise deprived of the normal use of the said remainder.

ISSUE # 3​:

Whether or not the petitioner should return the initial payment made by the respondents in the amount
of ₱l,480,000.
 NO. Respondents are barred by estoppel from recovering the initial payment of ₱l,480,000
from petitioner

Guilty of reiteration, Sec. 112 of CA 141 precludes petitioner from claiming just
compensation for the government’s enforcement of its right of way. The contract allegedly entered by
the parties for the government’s acquisition of the affected portion of the property in exchange for just
compensation is then void ​ab initio ​for being contrary to law. Consequently, petitioner has no right to
collect just compensation for the government’s use of the 223 square meter lot. Anent the ₱l,480,000
partial payment already made by respondents, such amount paid shall be governed by the provisions
on ​solutio indebiti ​or unjust enrichment. Xxx

Regardless, respondents’ action to compel petitioner to return what was mistakenly delivered
is now barred by the doctrine of estoppel. The doctrine is based upon the grounds of public policy,
fair dealing, good faith and justice, and its purpose is to forbid one to speak against his own act,
representations, or commitments to the injury of one to whom they were directed and who reasonably
relied thereon. The doctrine of estoppel springs from equitable principles and the equities in the case.

As a general rule, the State cannot be barred by estoppel by the mistakes or errors of its
officials or agents. But as jurisprudence elucidates, the doctrine is subject to exceptions, viz:

Estoppels against the public are little favored. They should not be invoked except [in rare]
and unusual circumstances, and may not be invoked where they would operate to defeat the effective
operation of a policy adopted to protect the public. They must be applied with circumspection and
should be applied only in those special cases where the interests of justice clearly require it.
Nevertheless, the government must not be allowed to deal dishonorably or capriciously with its
citizens, and must not play an ignoble part or do a shabby thing; and subject to limitations … , the
doctrine of equitable estoppel may be invoked against public authorities as well as against private
individuals.

15. Mosqueda et al v. Pilipino banana Growers & Exporters Association GR. NO. 189185

Facts:
After several committee hearings and consultations with various stakeholders, the
Sangguniang Panlungsod of Davao City enacted Ordinance No. 0309, Series of 2007, to impose a ban
against aerial spraying as an agricultural practice by all agricultural entities within Davao City
The Pilipino Banana Growers and Exporters Association, Inc. (PBGEA) and two of its
members, namely: Davao Fruits Corporation and Lapanday Agricultural and Development
Corporation (PBGEA, et al.), filed their petition in the RTC to challenge the constitutionality of the
ordinance
They alleged that the ordinance exemplified the unreasonable exercise of police power;
violated the equal protection clause; amounted to the confiscation of property without due process of
law; and lacked publication pursuant] to Section 511[6] of Republic Act No. 7160
On September 22, 2007, after trial, the RTC rendered judgment declaring Ordinance No.
0309-07 valid and constitutional
 The RTC opined that the City of Davao had validly exercised police power[13] under the
General Welfare Clause of the Local Government Code;[14] that the ordinance, being based on a
valid classification, was consistent with the Equal Protection Clause; that aerial spraying was distinct
from other methods of pesticides application because it exposed the residents to a higher degree of
health risk caused by aerial drift;[15] and that the ordinance enjoyed the presumption of
constitutionality, and could be invalidated only upon a clear showing that it had violated the
Constitution.
On January 9, 2009, the CA promulgated its assailed decision reversing the judgment of the
RTC.[22] It declared Section 5 of Ordinance No. 0309-07 as void and unconstitutional for being
unreasonable and oppressive;
The CA did not see any established relation between the purpose of protecting the public and
the environment against the harmful effects of aerial spraying, on one hand, and the imposition of the
ban against aerial spraying of all forms of substances, on the other.
Issues:
Whether or not Ordinance No. 0309-07 is unconstitutional on due process and equal protection
grounds for being unreasonable and oppressive, and an invalid exercise of police power: (a) in
imposing a ban on aerial spraying as an agricultural practice in Davao City under Section 5; (b) in
decreeing a 3-month transition-period to shift to other modes of pesticide application under Section 5;
and (c) in requiring the maintenance of the 30-meter buffer zone under Section 6 thereof in all
agricultural lands in Davao City.
Ruling:
The Sangguniang Bayan of Davao City enacted Ordinance No. 0309-07 under its corporate
powers... the right to a balanced and healthful ecology under Section 16 is an issue of transcendental
importance with intergenerational implications. It is under this milieu that the questioned ordinance
should be appreciated.
Advancing the interests of the residents who are vulnerable to the alleged health risks due to
their exposure to pesticide drift justifies the motivation behind the enactment of the ordinance. The
City of Davao has the authority to enact pieces of legislation that will promote the general welfare,
specifically the health of its constituents. Such authority should not be construed, however, as a valid
license for the City of Davao to enact any ordinance it deems fit to discharge its mandate. A thin but
well-defined line separates authority to enact legislations from the method of accomplishing the same.
Ordinance No. 0309-07 violates the Due Process Clause
A valid ordinance must not only be enacted within the corporate powers of the local
government and passed according to the procedure prescribed by law. In order to declare it as a valid
piece of local legislation, it must also comply with the following substantive requirements, namely:
(1) it must not contravene the Constitution or any statute; (2) it must be fair, not oppressive; (3) it
must not be partial or discriminatory; (4) it must not prohibit but may regulate trade; (5) it must be
general and consistent with public policy; and (6) it must not be unreasonable.In the State's exercise
of police power, the property rights of individuals may be subjected to restraints and burdens in order
to fulfill the objectives of the Government. A local government unit is considered to have properly
exercised its police powers only if it satisfies the following requisites, to wit: (1) the interests of the
public generally, as distinguished from those of a particular class, require the interference of the State;
and (2) the means employed are reasonably necessary for the attainment of the object sought to be
accomplished and not unduly oppressive.The first requirement refers to the Equal Protection Clause
of the Constitution; the second, to the Due Process Clause of the Constitution. Substantive due
process requires that a valid ordinance must have a sufficient justification for the Government's
action. This means that in exercising police power the local government unit must not arbitrarily,
whimsically or despotically enact the ordinance regardless of its salutary purpose. So long as the
ordinance realistically serves a legitimate public purpose, and it employs means that are reasonably
necessary to achieve that purpose without unduly oppressing the individuals regulated, the ordinance
must survive a due process challenge.
The required civil works for the conversion to truck-mounted boom spraying alone will
consume considerable time and financial resources given the topography and geographical features of
the plantations. As such, the conversion could not be completed within the short timeframe of three
months. Requiring the respondents and other affected individuals to comply with the consequences of
the ban within the three-month period under pain of penalty like fine, imprisonment and even
cancellation of business permits would definitely be oppressive as to constitute abuse of police power.
The respondents posit that the requirement of maintaining a buffer zone under Section 6 of
the ordinance violates due process for being confiscatory; and that the imposition unduly deprives all
agricultural landowners within Davao City of the beneficial use of their property that amounts to
taking without just compensation.
The position of the respondents is untenable.
In City of Manila v. Laguio, Jr., we have thoroughly explained that taking only becomes confiscatory
if it substantially divests the owner of the beneficial use of its property
Ordinance No. 0309-07 violates the Equal Protection Clause
The constitutional right to equal protection requires that all persons or things similarly
situated should be treated alike, both as to rights conferred and responsibilities imposed. It requires
public bodies and institutions to treat similarly situated individuals in a similar manner. The guaranty
equal protection secures every person within the State's jurisdiction against intentional and arbitrary
discrimination, whether occasioned by the express terms of a statue or by its improper execution
through the State's duly constituted authorities. The concept of equal justice under the law demands
that the State governs impartially, and not to draw distinctions between individuals solely on
differences that are irrelevant to the legitimate governmental objective.
Equal treatment neither requires universal application of laws to all persons or things without
distinction,[120] nor intends to prohibit legislation by limiting the object to which it is directed or by
the territory in which it is to operate.[121] The guaranty of equal protection envisions equality among
equals determined according to a valid classification.[122] If the groupings are characterized by
substantial distinctions that make real differences, one class may be treated and regulated differently
from another.[123] In other word, a valid classification must be: (1) based on substantial distinctions;
(2) germane to the purposes of the law; (3) not limited to existing conditions only; and (4) equally
applicable to all members of the class.
In our view, the petitioners correctly argue that the rational basis approach appropriately
applies herein. Under the rational basis test, we shall: (1) discern the reasonable relationship between
the means and the purpose of the ordinance; and (2) examine whether the means or the prohibition
against aerial spraying is based on a substantial or reasonable distinction. A reasonable classification
includes all persons or things similarly situated with respect to the purpose of the law.
 Davao City justifies the prohibition against aerial spraying by insisting that the occurrence of
drift causes inconvenience and harm to the residents and degrades the environment. Given this
justification, does the ordinance satisfy the requirement that the classification must rest on substantial
distinction?We answer in the negative.
The occurrence of pesticide drift is not limited to aerial spraying but results from the conduct
of any mode of pesticide application. Even manual spraying or truck-mounted boom spraying
produces drift that may bring about the same inconvenience, discomfort and alleged health risks to the
community and to the environment.[141] A ban against aerial spraying does not weed out the harm
that the ordinance seeks to achieve.[142] In the process, the ordinance suffers from being
"underinclusive" because the classification does not include all individuals tainted with the same
mischief that the law seeks to eliminate.[143] A classification that is drastically underinclusive with
respect to the purpose or end appears as an irrational means to the legislative end because it poorly
serves the intended purpose of the law.
WHEREFORE, the Court DENIES the consolidated petitions for review on certiorari for their lack of
merit; AFFIRMS the decision promulgated on January 9, 2009 in C.A.-G.R. CV No. 01389-MIN.
declaring Ordinance No. 0309-07 UNCONSTITUTIONAL;

Silvina Tomines
16. Heirs of Juancho Adorna vs. Reyes 125 SCRA 220 (1983)
17. Manosca v. Court of Appeals 252 SCRA 412 (1996)
18. Estate of Jimenez v. Peza GR. No. 106804
19. NHA v. Heirs of Isidro Guivelondo GR No. 154411
20. NPC & Pobre v. CA Gr No. 106804
AT Tyron
21. Mactan Cebu Airport Authority V. CA GR 139495 Nov 27, 2000
22. Mun. Of Meycayauan vs IAC 157 scra 640 (1998)
23. De Knecht vs Bautista 100 SCRA 660 (1980)
24. Republic vs De Knecht GR 87351
25. De la Paz Masiklip v. Judge Legazpi GR. No. 136349

Vlaznake Viola
26. JIL v. Municipality of Pasig GR. No. 152230

FACTS:
The Municipality of Pasig needed an access road from E. R. Santos Street, a
municipal road near the Pasig Public Market, to Barangay Sto. Tomas
Bukid, Pasig. The Municipality then decided to acquire 51 square meters
of the property of Lorenzo Ching Cuanco, Victor Ching Cuanco and Ernesto
Ching Cuanco Kho. The ​Sangguniang Bayan of Pasig approved an Ordinance
authorizing the municipal mayor to initiate expropriation proceedings to
acquire the said property and appropriate the fund therefor. The
ordinance stated that the property owners were notified of the
 municipality’s intent to purchase the property for public use as an
access road but they rejected the offer.
The plaintiff caused the annotation of a notice of ​lis pendens at the dorsal
portion of TCT No. PT-92579 under the name of the Jesus Is Lord Christian
School Foundation, Incorporated (JILCSFI) which had purchased the
property. Thereafter, the plaintiff constructed therein a cemented road
with a width of three meters. The defendants claimed that, as early as
February 1993, they had sold the said property to JILCSFI as evidenced by
a deed of sale bearing the signature of defendant Ernesto Ching Cuanco
Kho and his wife. JILCSFI averred the plaintiff’s exercise of eminent
domain was only for a particular class and not for the benefit of the
poor and the landless. It alleged that the property sought to be
expropriated is not the best portion for the road and the least
burdensome to it. JILCSFI also averred that it has been denied the use
and enjoyment of its property because the road was constructed in the
middle portion and that the plaintiff was not the real party-in-interest.
Rolando Togonon, plaintiffs messenger testified that he served a letter of
Engr. Jose Reyes, the Technical Assistant to the Mayor on Infrastructure,
to Lorenzo Ching Cuanco at his store. A lady received the same and
brought it inside the store. When she returned the letter to him, it
already bore the signature of Luz Bernarte. He identified a photocopy of
the letter as similar to the one he served at the store but admitted that
he never met Luz Bernarte.
Edgardo del Rosario, a resident of Sto. Tomas Bukid, declared that he would
pass through a wooden bridge to go to E. R. Santos Street. At times, the
bridge would be slippery and many had met accidents while walking along
the bridge. Because of this, they requested Mayor Vicente Eusebio to
construct a road therein. He attested that after the construction of the
cemented access road, the residents had water and electricity.
Augusto Paz of the City Engineers Office testified that, sometime in 1992,
the plaintiff constructed a road perpendicular from E. R. Santos Street
to Sto. Tomas Bukid; he was the Project Engineer for the said
undertaking. Before the construction of the road, the lot was raw and
they had to put filling materials so that vehicles could use it.
According to him, the length of the road which they constructed was 70
meters long and 3 meters wide so that a fire truck could pass through. He
 averred that there is no other road through which a fire truck could pass
to go to Sto. Tomas Bukid.
Manuel Tembrevilla, the Fire Marshall, averred that he had seen the new
road, that is, Damayan Street, and found that a fire truck could pass
through it. He also stated that it is the only road in the area.

ISSUE:
(1)Whether the respondent complied with the requirement of a valid and
definite offer to acquire the property prior to the filing of the
complaint
(2) Whether its property which is already intended to be used for public
purposes may still be expropriated by the respondent

HELD:

(1) NO. The respondent failed to prove that before it filed its
complaint, it made a written definite and valid offer to acquire
the property for public use as an access road. The letter is not
a valid and definite offer to purchase a specific portion of the
property for a price certain. It is merely an invitation for
only one of the co-owners, Lorenzo Ching Cuanco, to a conference
to discuss the project and the price that may be mutually
acceptable to both parties.

Article 35 of the Rules and Regulations Implementing the Local Government

Code provides:
ARTICLE 35. Offer to Buy and Contract of Sale.
(a) The offer to buy private property for public use or purpose shall be in
writing. It shall specify the property sought to be acquired, the
reasons for its acquisition, and the price offered.
(b) If the owner or owners accept the offer in its entirety, a contract of
sale shall be executed and payment forthwith made.
(c) If the owner or owners are willing to sell their property but at a
price higher than that offered to them, the local chief executive shall
call them to a conference for the purpose of reaching an agreement on
the selling price. The chairman of the appropriation or finance
 committee of the sanggunian, or in his absence, any member of the
sanggunian duly chosen as its representative, shall participate in the
conference. When an agreement is reached by the parties, a contract of
sale shall be drawn and executed.
(d) The contract of sale shall be supported by the following documents:
(1) Resolution of the sanggunian authorizing the local chief executive to
enter into a contract of sale. The resolution shall specify the terms
and conditions to be embodied in the contract;
(2) Ordinance appropriating the amount specified in the contract; and
(3) Certification of the local treasurer as to availability of funds
together with a statement that such fund shall not be disbursed or spent
for any purpose other than to pay for the purchase of the property
involved.

(2) Yes. The taking to be valid must be for public use. 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, determines what public use is. 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 requirements of public use.

27. Filstream International v CA 284 SCRA 716 (1998)

​FACTS:

Filstream International Inc., is the registered owner of the properties land

situated in Antonio Rivera Street, Tondo II, Manila, who filed an
ejectment suit against the occupants of the abovementioned parcels of
land on the grounds of termination of the lease contract and non-payment
of rentals. Private respondents appealed the decision to the Regional
 Trial Court and subsequently to the Court of Appeals, both RTC and CA
affirmed with the decision of the MTC.
The City Government approved Ordinance No. 7813 authorizing Mayor Alfredo S.
Lim to initiate the acquisition by negotiation, expropriation, purchase,
or other legal means certain parcels of land which formed part of the
properties of petitioner then occupied by private respondents.
Subsequently, the City of Manila approved Ordinance No. 7855 declaring
the expropriation of certain parcels of land and were to be sold and
distributed to qualified tenants of the area pursuant to the Land Use
Development Program of the City of Manila. Respondent filed a complaint
for eminent domain before the RTC of Manila seeking to expropriate the
aforecited parcels of land owned by petitioner Filstream wherein trial
court issued a Writ of Possession in favor of the former which ordered
the transfer of possession over the disputed premises to the respondent.
Petitioner Filstream filed a motion to dismiss the complaint for eminent
domain and a motion to quash the writ of possession. The motion to
dismiss was premised on the following grounds: (1)no valid cause of
action; (2)the petition does not satisfy the requirements of public use
and a mere clandestine maneuver to circumvent the writ execution issued
by the RTC of Manila in the ejectment suit;(3)violation of the
constitutional guarantee against non-impairment of obligation and
contract;(4)price offered was too low hence violative of the just
compensation provision of the constitution and the said amount is without
the certification of the City Treasurer for availability of funds. With
respect to the motion to quash the writ of possession, petitioner raised
the following objections: (1)failure to comply with Section 2 of Rule 67
of the Rules of Court, Ordinance No. 7813 is a void enactment for it was
approved without a public hearing and violative of the constitutional
guarantee against impairment of obligation and contracts;(2)the price is
too low and unconscionable violating the just compensation provision of
the constitution,(3)and the said writ is tainted with infirmity
considering the absence of a certification from the City of Manila that
there is an immediately available fund for the subject expropriation. The
RTC then denied the defendants motion to dismiss and motion to quash writ
of possession. Petitioner filed a motion for reconsideration and
subsequent motion but both were denied.
Aggrieved, petitioner filed a Petition for Certiorari with the Court of
Appeals seeking to set aside the order of the RTC of Manila. However, CA
issued a resolution dismissing the petition in this wise:
It appearing that the above-entitled petition is insufficient in form and
substance -- it does not comply with Section 2(a), Rule 6 of the Revised
Internal Rules of the Court of Appeals which requires that the petition
shall be x x x accompanied by x x x other pertinent documents and papers,
aside from the fact that copies of the pleadings attached to the petition
are blurred and unreadable.

Petitioner Filstream is now before this Court via a Petition for ​Certiorari
seeking to nullify the Resolutions of the Court of Appeals which granted
herein private respondents prayer for a TRO and Writ of Preliminary
Injunction, the same being null and void for having been issued in grave
abuse of discretion. The issue raised is purely procedural and technical
matter. Respondent appellate court seriously erred in giving more premium
to form rather than the substance.
A strict adherence to the technical and procedural rules in this case
would defeat rather than meet the ends of justice as it would result in
the violation of the substantial rights of petitioner. At stake in the
appeal filed by petitioner before the CA is the exercise of their
property rights over the disputed premises which have been expropriated
and have in fact been ordered condemned in favor of the City of Manila.
The dismissal of their appeal in the expropriation proceedings based on
the aforementioned grounds is tantamount to a deprivation of property
without due process of law as it would automatically validate the
expropriation proceedings based on the aforementioned grounds is
tantamount to a deprivation of property without due process of law as it
would automatically validate the expropriation proceedings which the
petitioner is still disputing. It must be emphasized that where
substantial rights are affected, as in this case, the stringent
application of procedural rules may be relaxed if only to meet the ends
of substantial justice.

ISSUE:
Whether or not the City of Manila complied with the proper proceedings in
exercising its power of eminent domain.

HELD:

No. City of Manila did not comply with the proper proceedings in exercising
its power of eminent domain. The State has a paramount interest in
exercising its power of eminent domain for the general good considering
that the right of the State to expropriate private property as long as it
is for public use always takes precedence over the interest of private
property owners. However we must not lose sight of the fact that the
individual rights affected by the exercise of such right are also
entitled to protection, bearing in mind that the exercise of this
superior right cannot override the guarantee of due process extended by
the law to owners of the property to be expropriated.

Section 19 of the 1991 Local Government Code is very explicit that it must
comply with the provisions of the Constitution and pertinent laws, to
wit:
SECTION 19. Eminent Domain. A local government unit may, through its chief
executive and acting pursuant to an ordinance, exercise the power of
eminent domain for public use, or purpose, or welfare for the benefit of
the poor and the landless, upon payment of just compensation, pursuant
to the provisions of the Constitution and pertinent laws.

The governing law that deals with the subject of expropriation for purposed
of urban land reform and housing in Republic Act No. 7279 (Urban
Development and Housing Act of 1992) and Sections 9 and 10 of which
specifically provide as follows:
Sec. 9. ​Priorities in the acquisition of Land Lands for socialized housing
shall be acquired in the following order:
(a) Those owned by the Government or any of its sub-divisions,
instrumentalities, or agencies, including government-owned or controlled
corporations and their subsidiaries;
(b) Alienable lands of the public domain;
(c) Unregistered or abandoned and idle lands;
(d) Those within the declared Areas of Priority Development, Zonal
Improvement sites, and Slum Improvement and Resettlement Program sites
which have not yet been acquired;
(e) Bagong Lipunan Improvement sites and Services or BLISS sites which have
not yet been acquired; and
(f) Privately-owned lands.

Where on-site development is found more practicable and advantageous to the

beneficiaries, the priorities mentioned in this section shall not apply.
The local government units shall give budgetary priority to on-site
development of government lands.

Sec. 10. ​Modes of Land Acquisition. ​ he

T modes of acquiring lands 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
to 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.

28. Heirs of Feliciano, Jr. V. Landbank (DAR Formula) gr. 215290

January 11, 2017

G.R. No. 215290
HEIRS OF PABLO FELICIANO, JR., namely: LOURDES FELICIANO TUDLA, GLORIA
FELICIANO CAUDAL, GABRIELA FELICIANO BAUTISTA, ANGELA FELICIANO LUCAS,
DONNA CELESTE FELICIANO-GATMAITAN, CYNTHIA CELESTE FELICIANO, and HECTOR
REUBEN FELICIANO, represented by its assignee, VICTORIA ALDA REYES
ESPIRITU,, Petitioners,
vs.
LAND BANK OF THE PHILIPPINES, Respondent.

FACTS:

The heirs of Pablo Feliciano, are co-owners of a 300 hectare parcel of

agricultural land situated at Camarines Sur. In 1972, a portion of the
afore-mentioned land was classified as un-irrigated Riceland and placed
under the coverage of Presidential Decree No.27. The Certificates of Land
Transfer were distributed to the 84 tenant-beneficiaries in 1973 who were
issued Emancipation Patents in 1989.

The Department of Agrarian Reform valued the subject land at P1,301,498.09

inclusive of interests, but Feliciano heirs rejected the said valuation.
LBP filed a petition for the determination of just compensation before
the Regional Trial Court of Naga City which was initially dismissed, but
eventually reinstated.

The RTC then ​(a) f​ ixed the just compensation for the subject land at
₱7,725,904.05; and ​(b) d​ irected the LBP ​(i) t
​ o pay Espiritu the said
amount, less amounts already paid to and received by the Feliciano heirs,
and ​(ii) ​to pay 12% interest p.a. on the unpaid balance of the just
compensation, computed from January 1, 2010 until full payment. It
observed that the subject land, which was expropriated pursuant to PD 27,
fell under the coverage of Administrative Orders (​DAR AO 13 series of
1994, AO 2 series of 2004 and AO 6 series of 2008) ​ that provided for the
payment of 6% annual interest for any delay in the payment of just
compensation. Since DAR AO 06-2008 was effective only until December 31,
2009, the RTC imposed 12% interest p.a. on the unpaid just compensation
from January 1, 2010 until full payment. Both parties moved for
reconsideration, which were denied in an Order dated November 24, 2011,
modifying the reckoning of the 12% interest p.a. from the finality of the
Decision until its satisfaction.

Feliciano heirs elevated the matter before the CA, whom, fixed the just
compensation for the subject land at ₱7,725,904.05, plus legal interest
at the rate of twelve percent (12%) p.a., computed from July 1, 2009 up
to the finality of the Decision, or the total amount of ₱8,316,876,97,
and directed the LBP to pay the said amount to Espiritu. It ruled that
the DAR AOs are no longer applicable to the instant case since the
subject land was revalued based on the July 1, 2009 values pursuant to
DAR AO 1, Series of 2010. It further held that interest at 12% p.a. was
proper considering the delay in the payment of just compensation. But
 then was amended and pointed out that since the LBP had already paid
petitioners the total amount of ₱7,725,904.05 on December 13, 2011, it is
only liable for the payment of 12% interest p.a., accruing from July 1,
2009 up to the said date, or the amount of P1,892,471.01. Accordingly, it
ordered the LBP to pay Espiritu the said amount, which shall thereafter
earn interest at the rate of six percent (6%) p.a. from the finality of
the said Decision until full payment.

ISSUE:
Whether or not the CA's determination of just compensation is correct.

HELD:

NO. Neither the RTC nor the CA considered the date when the claim folder was
received nor explained their reasons for deviating from the DAR formula.
They should have utilized the basic formula prescribed and laid down in
pertinent DAR regulations existing prior to the passage of RA 9700, in
determining the just compensation for the subject land.

When the acquisition process under PD 27 is still incomplete just

compensation should be determined and the process be concluded under
Republic Act No. (RA) 6657, otherwise known as the "Comprehensive
Agrarian Reform Law of 1988.

Just compensation must be valued at the time of taking, ​or the time when
the owner was deprived of the use and benefit of his property, in this
case, when emancipation patents were issued in the names of the
farmer-beneficiaries in 1989. Hence, the evidence to be presented by the
parties before the RTC for the valuation of the subject land must be
based on the values prevalent on such time of taking for like
agricultural lands.

Just compensation must be arrived at pursuant to the guidelines set forth

in Section 17 of RA 6657, as amended, prior to its amendment by RA 9700.
However, the RTC is reminded that while it should take into account the
different formula created by the DAR in arriving at the just compensation
for the subject land, it is not strictly bound thereto if the situations
before it do not warrant their application. In any event, should the RTC
find the said guidelines to be inapplicable, it must clearly explain the
reasons for deviating therefrom, and for using other factors or formula
in arriving at the reasonable just compensation for the acquired
property.

Interest may be awarded as may be warranted by the circumstances of the

case and based on prevailing jurisprudence. ​In previous cases, the Court
has allowed the grant of legal interest in expropriation cases where
there is delay in the payment since the just compensation due to the
landowners was deemed to be an effective forbearance on the part of the
 State. Legal interest on the unpaid balance shall be pegged at the rate
of 12% p.a. from the time of taking in 1989 when Emancipation Patents
were issued, until June 30, 2013 only. Thereafter, or beginning July 1,
2013, until fully paid, the just compensation due the landowners shall
earn interest at the new legal rate of 6% p.a.

29. Esteban v. De Onorio GR. No. 146062

G.R. No. 146062

June 28, 2001

SANTIAGO ESLABAN, JR., in his capacity as Project Manager of the National

Irrigation Administration, petitioner,
vs.
CLARITA VDA. DE ONORIO, respondent.

FACTS:

Clarita Vda. De Onorio is the owner of the land in Barangay M. Roxas, Sto.
Nino, South Cotabato. Such land is the subject for the construction of an
irrigation canal of the National Irrigation Administration(NIA). Mr.
Santiago Eslaban Jr. is the project manager of NIA. The parties agreed to
the construction of the canal provided that the government will pay for
the area that has been taken. A right-of-way agreement was entered into
by the parties in which respondent was paid the amount of P4, 180.00 as
right of way damages. Subsequently, respondent executed an Affidavit of
Waiver of Rights and Fees which waives her rights for the damage to the
crops due to construction of the right of way. After which, respondent
demands that petitioner pay P 111, 299.55 for taking her property but the
petitioner refused. Petitioner states that the government had not
consented to be sued and that the respondent is not entitled for
compensation by virtue of the homestead patent under CA no. 141. The RTC
held that the NIA should pay respondent the amount of P107, 517.60 as
just compensation for the 24,660 sq meters that have been used for the
construction of the canal. The Court of Appeals also affirmed the
decision of the RTC.

ISSUES:

Whether or Not the CA is correct in affirming the decision of the RTC.

DECISION:

The CA is correct in affirming the decision of the RTC.

PD NO. 1529 provides that the owner is required to recognize in favor of the
government the easement of a “public highway, way, private way
established by law, or any government canal where the certificate of
title does not state that the boundaries thereof have been
pre-determined. In the case at bar, the irrigation canal was constructed
 on Oct 1981 after the property had been registered in May of 1976. In
this case, prior expropriation proceedings must be filed and just
compensation shall be paid to the owner before the land could be taken
for public use.

Just compensation is defined as not only the correct amount to be paid but
the reasonable time for the Government to pay the owner. The CA erred in
this point by stating that the market value (just compensation) of the
land is determined in the filing of the complaint in 1991.The
determination of such value should be from the time of its taking by the
NIA in 1981.

The petitioner cannot argue that the Affidavit of waiver of rights and fees
executed by the respondent pertains to the payment of the value of the
land therefore exempting NIA to pay the value of the land taken. Such
waiver pertains only to the crops and improvements that were damage due
to the construction of the right-of-way not the value of the land.

30. EPZA vs. Dulay 149 SCRA 305 (1987)

G.R. No. L-59603

April 29, 1987

EXPORT PROCESSING ZONE AUTHORITY, petitioner,

vs.
HON. CEFERINO E. DULAY, in his capacity as the Presiding Judge, Court of
First Instance of Cebu, Branch XVI, Lapu-Lapu City, and SAN ANTONIO
DEVELOPMENT CORPORATION, respondents, Elena M. Cuevas for respondents.
GUTIERREZ, JR., ​J.:

FACTS:

On January 15, 1979, Proclamation No. 1811 was issued, which reserves four
(4) parcels of land of the public domain situated in the City of
Lapu-Lapu, Island of Mactan, Cebu for the establishment of an export
processing zone by petitioner Export Processing Zone Authority (EPZA).

Private respondent San Antonio Development Corporation, in which these lands

are registered under, claimed that the lands were expropriated to the
government without them reaching the agreement as to the compensation.
Respondent Judge Dulay then issued an order of condemnation declaring the
petitioner as having the lawful right to take the properties sought to be
condemned, upon the payment of just compensation to be determined as of
the filing of the complaint, and for the appointment of the commissioners
to determine the just compensation. The three commissioners submitted
their consolidated report recommending the amount of P15.00 per square
meter as the fair and reasonable value of just compensation for the
properties, which was objected to by the petitioner contending that under
PD 1533, the basis of just compensation shall be fair and according to
the fair market value declared by the owner of the property sought to be
expropriated, or by the assessor, whichever is lower. Such objection and
 the subsequent Motion for Reconsideration were denied and hearing was set
for the reception of the commissioner’s report. EPZA then filed this
petition for certiorari and mandamus enjoining the respondent from
further hearing the case.
ISSUES:

Whether or Not the exclusive and mandatory mode of determining just

compensation in PD 1533 is valid and constitutional?

DECISION:

The Supreme Court ruled that the mode of determination of just

compensation in PD 1533 is unconstitutional.

The method of ascertaining just compensation constitutes impermissible

encroachment to judicial prerogatives. It tends to render the courts
inutile in a matter in which under the Constitution is reserved to it for
financial determination. The valuation in the decree may only serve as
guiding principle or one of the factors in determining just compensation,
but it may not substitute the court’s own judgment as to what amount
should be awarded and how to arrive at such amount. The determination of
just compensation is a judicial function. The executive department or the
legislature may make the initial determination but when a party claims a
violation of the guarantee in the Bill of Rights that the private party
may not be taken for public use without just compensation, no statute,
decree, or executive order can mandate that its own determination shall
prevail over the court’s findings. Much less can the courts be precluded
from looking into the justness of the decreed compensation.

Rafael Ian Larioza Andal

31. LAND BANK OF THE PHIL. V. Yatco Agricultural GR. 172551

Facts: Respondent Yatco Agricultural Enterprises (Yatco) was the registered owner of a parcel of
agricultural land in Laguna. In 1999, the government placed the property under the coverage of its
Comprehensive Agrarian Reform Program (CARP).

Pursuant to Executive Order (E.O.) No. 405,7 the LBP valued the property at ₱1,126,132.89. Yatco
did not find this valuation acceptable and thus elevated the matter to the Department of Agrarian
Reform (DAR) Provincial Agrarian Reform Adjudicator (PARAD), which computed the value of the
property at ₱16,543,800.00. The PARAD used the property’s current market value (as shown in the
tax declaration that Yatco submitted) and applied the formula "Market Value x 2." The PARAD noted
that the LBP did not present any verified or authentic document to back up its computation; hence, it
brushed aside the LBP’s valuation.

Not satisfied, LBP filed with the RTC-Special Agrarian Court (SAC) a petition for the judicial
determination of just compensation. The RTC-SAC fixed the just compensation for the property at
₱200.00 per square meter (₱55,146,000.00), relying on the valuation by RTC Branch 36 in an
eminent domain case it decided. The RTC-SAC further pointed out that the LBP failed to prove that it
complied with the prescribed procedure and likewise failed to consider the valuation factors provided
in Section 17 of the Comprehensive Agrarian Reform Law of 1988 (CARL). The RTC-SAC
subsequently denied the LBP’s motion for reconsideration.

The LBP appealed to the CA. The CA dismissed the LBP’s appeal. As the determination of just
compensation is essentially a judicial function, the CA thus affirmed the RTC-SAC’s valuation. The
LBP filed the present petition after the CA denied its motion for reconsideration in the CA’s May 3,
2006 resolution. Hence, a Rule 45 petition for review on certiorari to the Supreme Court.

Issue: Whether or not the RTC-SAC’s determination of just compensation for the property was
proper.

Held: The determination of just compensation is essentially a judicial function that the Judiciary
exercises within the parameters of the law. Section 57 of R.A. No. 6657 explicitly vests the
RTC-SAC the original and exclusive power to determine just compensation for lands under CARP
coverage and enumerates the factors required to be taken into account to correctly determine just
compensation. CARL likewise empowers the DAR to issue rules for its implementation. The DAR
thus issued DAR AO 5-98 incorporating the law’s listed factors in determining just compensation into
a basic formula that contains the details that take these factors into account.

When acting within the parameters set by the law itself, the RTC-SACs, however, are not strictly
bound to apply the DAR formula to its minute detail, and, they may, in the exercise of their
discretion, relax the formula’s application to fit the factual situations before them. The situation where
a deviation is made in the exercise of judicial discretion should at all times be distinguished from a
situation where there is utter and blatant disregard of the factors spelled out by law and by the
implementing rules. For in such a case, the RTC-SAC’s action already amounts to grave abuse of
discretion for having been taken outside of the contemplation of the law.

The RTC-SAC fully disregarded Section 17 of R.A. No. 6657 and DAR AO 5-98 and thus acted
outside the contemplation of the law.

Section 17 of R.A. No. 6657 reads:

Section 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 farmworkers
and by the Government to the property as well as the non-payment of taxes or loans secured from any
government financing institution on the said land shall be considered as additional factors to
determine its valuation.

The RTC-SAC did not point to any specific evidence or cite the values and amounts it used in
arriving at the ₱200.00 per square meter valuation. it did not indicate the formula that it used in
arriving at its valuation or which led it to believe that Branch 36’s valuation was applicable to this
case and it did not conduct an independent assessment and computation using the considerations
required by the law and the rules

Under these circumstances – i.e., the insufficiency of the evidence presented by both the LBP and
Yatco on the issue of just compensation - the more judicious approach that the RTC-SAC could have
taken was to exercise the authority granted to it by Section 58 of R.A. No. 6657, which provides that
the RTC-SAC may appoint one or more Commissioners to ascertain and report to it the facts
necessary for the determination of the just compensation for the property.

Remanded to the RTC-SAC for factual determination of just compensation.

32. Republic v. Macabagdal (definition) GR. 227215

Facts: In 2008, the Republic of the Philippines (petitioner), represented by the Department of Public
Works and Highways, filed before the RTC a complaint against an unknown owner for the
expropriation of a 200 sqm lot located in Valenzuela City for the construction of the C-5 Northern
Link Road Project, otherwise known as North Luzon Expressway (NLEX) Segment 8.1. Petitioner
thereafter applied for, and was granted a writ of possession over the subject lot and was required to
deposit with the court the amount of ₱550,000.00 (i.e., at ₱2,750.00/sqm.) representing the zonal
value thereof.

In 2012, respondent received the provisional deposit and did not oppose the expropriation.

The RTC appointed a board of commissioners to determine the just compensation for the subject lot.
The board submitted its Commissioners' Report in 2014, recommending a fair market value of
₱9,000.00/sqm. as the just compensation for the subject lot, taking into consideration its location,
neighborhood and land classification, utilities, amenities, physical characteristics, occupancy and
usage, highest and best usage, current market value offerings, as well as previously decided
expropriation cases of the same RTC involving properties similarly situated in the same barangay.

The RTC found the recommendation of the commissioners to be reasonable and just, and accordingly:
(a) fixed the just compensation for the subject lot at ₱9,000.00/sqm.; (b) directed petitioner to pay the
same, less the provisional deposit of ₱550,000.00; and (c) imposed legal interest at the rate of twelve
percent (12%) p.a. on the unpaid balance, computed from the time of the taking of the subject lot until
full payment.

Dissatisfied, petitioner appealed before the CA, questioning the just compensation of ₱9,000.00/sq. m.
and the award of twelve percent (12%) interest rate p.a., instead of six percent (6%) p.a.17 as
provided under Bangko Sentral ng Pilipinas Monetary Board (BSP-MB) Circular No. 799, Series of
2013. The CA affirmed the RTC Decision, holding that the findings of the RTC was amply supported
by the evidence on record. Hence a petition for review on certiorari to the Supreme Court.

Issue: Whether or not the CA committed reversible error in affirming the RTC's imposition of interest
at the rate of twelve percent (12%) p.a. on the unpaid balance, computed from the time of the taking
of the subject lot until full payment.

Held: The petition is partly meritorious. The purpose of just compensation is not to reward the owner
for the property taken, but to compensate him for the loss thereof. As such, the true measure of the
property, as upheld in a plethora of cases, is the market value at the time of the taking, when the loss
resulted. In addition, the Court also recognizes that the owner's loss is not only his property, but also
its income-generating potential. The value of the landholdings should be equivalent to the principal
sum of the just compensation due, and interest is due and should be paid to compensate for the unpaid
balance of this principal sum after taking has been completed.
Petitioner had only paid a provisional deposit in the amount of ₱550,000.00 (i.e., at ₱2,750.00/sq. m.).
Thus, this left an unpaid balance of the "principal sum of the just compensation," warranting the
imposition of interest. However, as aptly pointed out by petitioner, the twelve percent (12%) p.a. rate
of legal interest is only applicable until June 30, 2013. Thereafter, legal interest shall be at six percent
(6%) p.a. in line with BSP-MB Circular No. 799, Series of 2013.

Nonetheless, it bears to clarify that legal interest shall run not from the date of the filing of the
complaint but from the date of the issuance of the Writ of Possession, since it is from this date that the
fact of the deprivation of property can be established.

CA decision affirmed with modification as to the reckoning date when interest started to accrue and
the applicable interest rates for the periods before and after the effectivity of the BSP-MB Circular.

33. Napocor v. Sps Chiong (Consequential Damage and benefit) GR. 152436

Facts: NAPOCOR filed a complaint for eminent domain with the RTC of Iba, Zambales. It sought the
acquisition of an easement of right-of-way and certain portions of agricultural lands owned by
respondents, to be used in its Northwestern Luzon Transmission Line Project. NAPOCOR prayed for
the issuance of a writ of possession and an order of expropriation, the appointment of three (3)
commissioners to determine the just compensation, and to adjudge NAPOCOR as having a lawful
right to enter, take, and acquire an easement of right-of-way over portions of the properties owned by
herein respondents.

In their answer, the respondents did not dispute the purpose of NAPOCOR in instituting the
expropriation proceedings. However, they pointed out that NAPOCOR had already entered and taken
possession of a portion of their realty and wanted to occupy another portion of the adjacent property.
Respondents averred that the fair market value for both properties was P1,100.00 per square meter or
a total of P8,800,000.00 and prayed that the trial court direct NAPOCOR to pay them said amount.

NAPOCOR filed an ex parte motion for the issuance of a writ of possession, which the trial court
granted. The trial court appointed commissioners to determine the fair market value of the land, as
well as the total area taken by petitioner from respondents. After considering the reports of the
Commissioners, the trial court gave due course to the same and directed the petitioner to pay the
respondents their land containing an area of 4,000 square meters at P500.00 per square meter and an
interest of six (6%) percent per annum from April 16, 1998 until fully paid.

Dissatisfied, NAPOCOR filed a special civil action for certiorari with the CA but the latter dismissed
the same for lack of merit. Hence this petition for review on certiorari

Issue: Whether or not the Court of Appeals erred in sustaining the Order of the RTC by dismissing
NAPOCOR’s petition for certiorari.

Held: In eminent domain or expropriation proceedings, the general rule is that the just compensation
to which the owner of condemned property is entitled to is the market value. Market value is that sum
of money which a person desirous but not compelled to buy, and an owner willing but not compelled
to sell, would agree on as a price to be given and received therefor. The aforementioned rule,
however, is modified where only a part of a certain property is expropriated. In such a case the owner
is not restricted to compensation for the portion actually taken. In addition to the market value of the
portion taken, he is also entitled to recover for the consequential damage, if any, to the remaining part
of the property. At the same time, from the total compensation must be deducted the value of the
consequential benefits.

Petitioner argued that the Court of Appeals gravely erred in upholding the RTC order requiring it to
pay the full market value of the expropriated properties, notwithstanding the fact that the petitioner
was only acquiring an easement of right-of-way. However, a perusal of its complaint shows that
petitioner also stated that it would erect structures for its transmission lines on portions of the
expropriated property. In other words, the expropriation was not to be limited for the purpose of
easement of right-of-way.

In finding that the trial court did not abuse its authority in evaluating the evidence and the reports
placed before it nor did it misapply the rules governing fair valuation, the Court of Appeals found the
majority reports valuation of P500 per square meter to be fair. Said factual finding of the Court of
Appeals, absent any showing that the valuation is exorbitant or otherwise unjustified, is binding on
the parties as well as this Court.

Petition is denied for lack of merit. CA decision affirmed.

34. Ansaldo vs Tantuico GR. 50147

Facts: Two lots of private ownership were taken by the Government and used for the widening of a
road more than forty-three years ago, without benefit of an action of eminent domain or agreement
with its owners, albeit without protest by the latter. The lots, belonging to the petitioners, were taken
from them some time in 1947 by the Department of Public Work, Transportation and Communication
and made part of what used to be Sta. Mesa Street and is now Ramon Magsaysay Avenue at San Juan,
Metro Manila.
Said owners made no move whatever until twenty-six years later. They wrote to ask for compensation
for their land. Their claim was referred to the Secretary of Justice, who thus advised that the
corresponding expropriation suit be forthwith instituted to fix the just compensation to be paid to the
Ansaldos.
Pursuant to this opinion, the Commissioner of Public Highways requested the Provincial Assessor of
Rizal to make a redetermination of the market value of the Ansaldos' property. The new valuation was
made, after which the Auditor of the Bureau of Public Highways forwarded the Ansaldos' claim to the
Auditor General with the recommendation that payment be made on the basis of the current and fair
market value and not on the fair market value at the time of taking.
The Commission on Audit, however, declined to adopt the recommendation. The Acting Chairman
ruled that the amount of compensation to be paid to the claimants is to be determined as of the time of
the taking of the subject lots. The ruling was reiterated by the Commission, and again when it denied
the Ansaldos' motion for reconsideration. It is these rulings of the Commission on Audit that the
Ansaldos have appealed to this Court.
Issue: Whether the precise time at which just compensation should be fixed is as of the time of actual
taking of possession by the expropriating entity or only after conveyance of title to the expropriator
pursuant to expropriation proceedings duly instituted.
Held: In the context of the State's inherent power of eminent domain, there is a "taking" when the
owner is actually deprived or dispossessed of his property; when there is a practical destruction or a
material impairment of the value of his property or when he is deprived of the ordinary use thereof.
Where the owner is deprived of the ordinary and beneficial use of his property or of its value by its
being diverted to public use, there is taking within the Constitutional sense. There was undoubtedly a
taking of the Ansaldos' property when the Government obtained possession thereof and converted it
into a part of a thoroughfare for public use.
It is as of the time of such a taking, to repeat, that the just compensation for the property is to be
established. The reason for the rule is that the value thereof may be enhanced by the public purpose
for which it is taken; the entry by the plaintiff upon the property may have depreciated its value
thereby; or, there may have been a natural increase in the value of the property from the time the
complaint is filed, due to general economic conditions. The owner of private property should be
compensated only for what he actually loses; it is not intended that his compensation shall extend
beyond his loss or injury. And what he loses is only the actual value of his property at the time it is
taken. This is the only way that compensation to be paid can be truly just not only to the individual
whose property is taken but, to the public, which is to pay for it.
Petition denied. COA decision affirmed.

35. NAPOCOR V. TIANGCO GR. 170846

Facts: Respondents, all surnamed Tiangco, are the owners of a parcel of land with an area of 152,187
square meters at Tanay, Rizal. On the other hand, petitioner NPC is a government-owned and
controlled corporation created for the purpose of undertaking the development and generation of
power from whatever source. NPCs charter (Republic Act No. 6395) authorizes the corporation to
acquire private property and exercise the right of eminent domain.
NPC requires 19,423 square meters of the respondents aforementioned property, across which its
500Kv Kalayaan-San Jose Transmission Line Project will traverse. NPCs Segregation Plan for the
purpose shows that the desired right-of-way will cut through the respondents land. After repeated
unsuccessful negotiations with the respondents, NPC filed with the RTC of Tanay, Rizal a complaint
for expropriation against them. In time, the respondents filed their answer.
The trial court issued a Condemnation Order, granting NPC the right to take possession of the area
sought to be expropriated. In the same Order, the court directed the parties to nominate their
respective commissioners, with a third member to be nominated and appointed by the court itself, to
determine the proper amount of just compensation to be paid to the respondents.
The trial court issued an order directing NPC to pay and deposit with the Rizal Provincial Treasurer
the amount of P81,204.00, representing the temporary provisional value of the area subject of the
expropriation prior to the taking of possession thereof. With NPC having complied with the deposit
requirement, a writ of possession was issued in its favor.
NPC filed an amended complaint to acquire only 19,423 square meters of the respondents property.
The original area of 20,220 square meters initially sought to be expropriated under the original
complaint turned out to be in excess of the area required.
For its part, NPC made it clear that it is interested only in acquiring an easement of right-of-way over
the respondents property and that ownership of the area over which the right-of-way will be
established shall remain with the respondents.
From the evidence before it, the trial court made a determination that the market value of the property
is P2.09 per square meter, or P40,594.07 for the entire 19,423 square meters needed by NPC, and not
the P30.00 per square meter claimed by the respondents.
The respondents moved for reconsideration. Respondents maintain that the price of P30.00 per square
meter for the needed area of 19,423 square meters is the reasonable amount and should be the basis
for fixing the amount of just compensation due them. The trial court denied the motion.
From the aforesaid decision of the trial court, both NPC and the respondents went on appeal to the
CA whereat the separate appeals were consolidated and docketed as CA-G.R. CV No. 53576. The
appellate court found merit in the respondents appeal, and disregarded the P2.09 per square meter
valuation of the trial court, which was based on a 1984 tax declaration. Instead, the CA placed
reliance upon a 1993 tax declaration, being only two years removed from the time of taking. The
appellate court determined the time of taking to be in 1991. Thus, the greater value of P913,122.00 as
declared in Tax Declaration No. 011-2667 dated July 23, 1993 should be the basis for determining
just compensation. NPC moved for reconsideration, but its motion was denied by the appellate court.
Issue: What amount is just by way of compensation for the 19,423 square-meter portion of the
respondents property.
Held: The trial court fixed the value of the property at its 1984 value, while the CA, at its 1993 worth.
Neither of the two determinations is correct. In eminent domain cases, the time of taking is the filing
of the complaint, if there was no actual taking prior thereto. Hence, in this case, the value of the
property at the time of the filing of the complaint on November 20, 1990 should be considered in
determining the just compensation due the respondents.
There is no issue as to the improvements. Since the P325,025.00 valuation therefor is the very price
set by the NPC commissioner, to which the corporation did not object but otherwise adopts, the Court
fixes the amount of P325,025.00 as just compensation for the improvements.
Just compensation is defined as the full and fair equivalent of the property taken from its owner by the
expropriator. The measure is not the takers gain, but the owners loss. In the determination of such
value, the court is not limited to the assessed value of the property or to the schedule of market values
determined by the provincial or city appraisal committee. The nature and character of the land at the
time of its taking is the principal criterion for determining how much just compensation should be
given to the landowner. All the facts as to the condition of the property and its surroundings, as well
as its improvements and capabilities, should be considered.
Neither of the two determinations made by the courts below is therefore correct. A new one must be
arrived at, taking into consideration the foregoing pronouncements.
Petitioner further claims that it should not be made to pay compensation for the entirety of the land
since what is claims to expropriate is only an easement of right of way and not ownership thereof.
This cannot be sustained. If the easement is intended to perpetually or indefinitely deprive the owner
of his proprietary rights through the imposition of conditions that affect the ordinary use, free
enjoyment and disposal of the property or through restrictions and limitations that are inconsistent
with the exercise of the attributes of ownership, or when the introduction of structures or objects
which, by their nature, create or increase the probability of injury, death upon or destruction of life
and property found on the land is necessary, then the owner should be compensated for the monetary
equivalent of the land.
Petition is partially granted. CA decision is set aside as it pertains to the determination of just
compensation for the subject property. Case is remanded to the court a quo for proper determination
of just compensation. CA decision is affirmed as it pertains to the award for the improvements.

Eve Villaruel
36. CITY of Cebu vs Spouses Dedamo GR. 142971

CITY OF CEBU v. SPS. APOLONIO AND BLASA DEDAMO, GR No. 142971,

2002-05-07
Facts:
Petitioner City of Cebu filed... a complaint for eminent domain against respondents
spouses Apolonio and Blasa Dedamo.The petitioner alleged therein that it needed the
following parcels of land of respondents... for a public purpose for the construction of a
public road.
The total area sought to be expropriated is 1,624 square meters with an assessed value
of P1,786,400. Petitioner deposited with the Philippine National Bank the amount of
P51,156 representing 15% of the fair market value of the property to... enable the
petitioner to take immediate possession of the property pursuant to Section 19 of R.A.
No. 7160.
Respondents, filed a motion to dismiss the complaint because the purpose for which
their property was to be expropriated was not for a public purpose but for benefit of a
single private entity, the Cebu Holdings, Inc. Petitioner could simply buy directly from
them the... property at its fair market value if it wanted to, just like what it did with the
neighboring lots. Besides, the price offered was very low in light of the consideration of
P20,000 per square meter, more or less, which petitioner paid to the neighboring lots.
Petitioner filed a motion for the issuance of a writ of possession
The motion was granted by the trial court... the parties executed and submitted to the
trial court an Agreement... wherein they declared that they have partially settled the case
and in consideration thereof they agreed
Pursuant to said agreement, the trial court appointed three commissioners to determine
the just compensation of the lots sought to be expropriated.
Thereafter, the commissioners submitted their report, which contained their respective
assessments of and recommendation as to the valuation of the property.
Plaintiff is directed to pay Spouses Apolonio S. Dedamo and Blasa Dedamo the sum of
pesos: P24,865.930.00... the commissioners submitted an amended assessment... and
fixed it at P12,824.10 per square meter, or in the amount of P20,826,339.50.
The assessment was approved as the just compensation thereof by the trial court
Petitioner elevated the case to the Court of Appeals... petitioner alleged that... just
compensation should be based on the prevailing... market price of the property at the
commencement of the expropriation proceedings.
Court of Appeals affirmed in toto the decision of the trial court.
Petitioner filed with us the petition for review in the case at bar.
Issues:
Whether just compensation should be determined as of the date of the filing of the
complaint.
Ruling:
Just compensation shall be determined as of the time of actual taking.
We explicitly stated... that although the general rule in determining just compensation in
eminent domain is the value of the property as of the date of the filing of the complaint,
the rule "admits of an exception: where this Court fixed the value of the property as of
the date it was taken and not at... the date of the commencement of the expropriation
proceedings."
Also, the trial court followed the then governing procedural law on the matter, which was
Section 5 of Rule 67 of the Rules of Court, which provided as follows:
SEC. 5. Ascertainment of compensation. -- Upon the entry of the order of condemnation,
the court shall appoint not more than three (3) competent and disinterested persons as
commissioners to ascertain and report to the court the just compensation for the...
property sought to be taken. The order of appointment shall designate the time and
place of the first session of the hearing to be held by the commissioners and specify the
time within which their report is to be filed with the court.
the parties, by a solemn document freely and voluntarily agreed upon by them, agreed
to be bound by the report of the commission and approved by the trial court. The
agreement is a contract between the parties. It has the force of law between... them and
should be complied with in good faith.
Furthermore, during the hearing, petitioner did not interpose a serious objection.
It is therefore too late for petitioner to question the valuation now without violating the
principle of equitable estoppel.
Records show that petitioner consented to conform with the valuation recommended by
the commissioners. It cannot detract from its agreement now and... assail correctness
of the commissioners' assessment.

37. ASSOC OF SMALL LANDOWNERS v. DAR 175 SCRA 343 (1998)

FACTS:
The following are consolidated cases:

1. A petition alleging the constitutionality of PD No. 27, EO 228 and 229 and RA
6657. Subjects of the petition are a 9-hectare and 5 hectare Riceland worked by
four tenants. Tenants were declared full owners by EO 228 as qualified farmers
under PD 27. The petitioners now contend that President Aquino usurped the
legislature‘s power.
2. A petition by landowners and sugar planters in Victoria‘s Mill Negros Occidental
against Proclamation 131 and EO 229. Proclamation 131 is the creation of
Agrarian Reform Fund with initial fund of P50Billion.
3. A petition by owners of land which was placed by the DAR under the coverage of
Operation Land Transfer.
4. A petition invoking the right of retention under PD 27 to owners of rice and corn
lands not exceeding seven hectares.

ISSUE:

Whether the aforementioned EO‘s, PD, and RA were constitutional.

HELD:

The promulgation of PD 27 by President Marcos was valid in exercise of Police power and
eminent domain.

The power of President Aquino to promulgate Proc. 131 and EO 228 and 229 was authorized
under Sec. 6 of the Transitory Provisions of the 1987 Constitution. Therefore it is a valid
exercise of Police Power and Eminent Domain

RA 6657 is likewise valid. The carrying out of the regulation under CARP becomes
necessary to deprive owners of whatever lands they may own in excess of the maximum area
allowed, there is definitely a taking under the power of eminent domain for which payment
of just compensation is imperative. The taking contemplated is not a mere limitation of the
use of the land. What is required is the surrender of the title and the physical possession of
said excess and all beneficial rights accruing to the owner in favour of the
farmer-beneficiary.

The Court declares that the content and manner of the just compensation provided for in
Section 18 of the CARP Law is not violative of the Constitution.

38. DAR V. CA 249 SCRA 149 (1995)

39. SEC OF DPWH AND ENGR. CONTRERAS V. SPS. TECSON GR. 179334
40. Republic v Lim GR. 161656
Jella Capadocia
41. Napocor vs Heirs of Sangkay (Inverse Condemnation) GR. 165828

FACTS:​ National Power Corporation (NPC) undertook the Agus River

Hydroelectric Power Plant Project to generate electricity for Mindanao. It included
the construction of several underground tunnels to be used in diverting the water
flow from the Agus River to the hydroelectric plants.

On 1997, Respondents sued NPC for recovery of damages of the property and a
prayer for just compensation. They alleged that the tunnel deprived them of the
agricultural, commercial, industrial and residential value of their land; and that
their land had also become an unsafe place for habitation, forcing them and their
workers to relocate to safer grounds.

ISSUE:​ Whether the Heirs of Sangkay have the right to just compensation

RULING:​ Just compensation is the full and fair equivalent of the property taken
from its owner by the expropriator. It has the objective to recover the value of
property taken in fact by the governmental defendant, even though no formal
exercise of the power of eminent domain has been attempted by the taking agency.

The underground tunnels impose limitations on respondents’ use of the property

for an indefinite period and deprive them of its ordinary use. Hence, respondents
are clearly entitled to the payment of just compensation.

Notwithstanding the fact that petitioner only occupies the sub-terrain portion, it is
liable to pay not merely an easement fee but rather the full compensation for land.
It is settled that the taking of private property for public use, to be compensable,
need not be an actual physical taking or appropriation. This is so because in this
case, the nature of the easement practically deprives the owners of its normal
beneficial use. Compensable taking includes destruction, restriction, diminution, or
interruption of the rights of ownership or of the common and necessary use and
enjoyment of the property in a lawful manner, lessening or destroying its value.
42. Meralco v Pineda 206 SCRA 196 (1992)

FACTS:​ ​MERALCO wanted to construct a 230 KV Transmission line from Barrio Malaya to
Tower at Pililla, Rizal in the real estate property of Teofilo Arayon Sr., Gil de Guzman, Lucito
Santiago and Teresa Bautista. Parties attempt negotiations but failed to reach an agreement and offers
to pay compensation. Respondents then filed a complaint for eminent domain with the trial court and
won the case granting them rights to expropriate the property needed. Unfortunately, the petitioner
sold to NAPOCOR its power plant and transmission lines including the property disputed herein. The
court then ordered the appraisal of the land in answer for the motion for withdrawal of deposit which
respondents were entitled to. However, the apprisal by the commissioners were never completed due
to the suspension when petitioners filed a Motion to Dismiss due to the said sale to NAPOCOR.
Later, respondents file another motion for for payment and the court granted them another sum for the
compensation. Petitioner then filed a Motion for Reconsideration that at this stage the respondents are
not yet entitled to payment of just compensation as there is no appraisal yet and that court, upon
awarding a fraction of sum, based it only on a witness of a credible realestate broker instead of
employing the assistance of three commissioners to determine just compensation.

ISSUE: ​W/N the employment of three commissioners in the ascertainment of just compensat
ion is dispensable

RULING:​ The judge's act of determining and ordering the payment of just compensation without
the assistance of a Board of Commissioners is a flagrant violation of MERALCO's constitutional
right to due process and is a gross violation of the mandated rule established by the Revised Rules of
Court.In an expropriation case where the principal issue is the determination of just compensation, a
trial before the Commissioners is indispensable to allow the parties to present evidence on the issue
of just compensation. The appointment of at least 3 competent persons as 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 court may
substitute its own estimate of the value, the latter may only do so for valid reasons:

1. where the Commissioners have applied illegal principles to the evidence submitted to them;
2. where they have disregarded a clear preponderance of evidence;
3. 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. Moreover, in such instances, where the report of the
commissioners may be disregarded, the trial court may make its own estimate of value from
competent evidence that may be gathered from the record.

43. NPC v. Henson GR NO. 129998

FACTS:
On 21 March 1990, the National Power Corporation (NAPOCOR) originally
instituted with the Regional Trial Court (RTC), Third Judicial District, Branch 46,
San Fernando, Pampanga a complaint for eminent domain, later amended on 11
October 1990, for the taking for public use of 5 parcels of land, owned or claimed by
Lourdes Henson (married to Eugenio Galvez), Josefina Henson (married to
Petronio Katigbak, Jesusa Henson, Corazon Henson (married to Jose Ricafort),
Alfredo Tanchiatco, Bienvenido David, Maria Bondoc Capili (married to Romeo
Capili), and Miguel Manoloto, with a total aggregate area of 58,311 square meters,
for the expansion of the NAPOCOR Mexico Sub-Station.

On 28 March 1990, NAPOCOR filed an urgent motion to fix the provisional value of
the subject parcels of land. On 20 April 1990, Henson, et. al. filed a motion to
dismiss. They did not challenge NAPOCOR's right to condemn their property, but
declared that the fair market value of their property was from P180.00 to P250.00
per square meter.
On 10 July 1990, the trial court denied Henson, et. al.'s motion to dismiss, but the
court did not declare that NAPOCOR had a lawful right to take the property sought
to be expropriated. However, the court fixed the provisional value of the land at
P100.00 per square meter, for a total area of 63,220 square meters of Henson, et.
al.'s property, to be deposited with the Provisional Treasurer of Pampanga.
NAPOCOR deposited the amount on 29 August 1990.
On 5 September 1990, the trial court issued a writ of possession in favor of
NAPOCOR, and, on 11 September 1990, the court's deputy sheriff placed NAPOCOR
in possession of the subject land. On 22 November 1990, and 20 December 1990,
the trial court granted the motions of Henson, et. al. to withdraw the deposit made
by NAPOCOR of the provisional value of their property amounting to
P5,831,100.00, with a balance of P690,900.00, remaining with the Provisional
Treasurer of Pampanga.
On 5 April 1991, the trial court issued an order appointing 3 commissioners to aid
the in the reception of evidence to determine just compensation for the taking of
subject property. After receiving the evidence and conducting an ocular inspection,
the commissioners submitted to the court their individual reports. However, the
trial court did not conduct a hearing on any of the reports.
On 19 May 1993, the trial court rendered judgment fixing the amount of just
compensation to be paid by the NAPOCOR for the taking of the entire area of
63,220 squares meters at P400.00 per square meter, with legal interest thereon
computed from 11 September 1990, when NAPOCOR
was placed in possession of the land, plus attorney's fees of P20,000.00, and costs
of the proceedings. In due time, NAPOCOR appealed to the Court of Appeals. On 23
July 1997, the Court of Appeals rendered decision affirming that of the Regional
Trial Court, except that the award of P20,000.00 as attorney's fees was deleted.
NAPOCOR filed a petition for review before the Supreme Court.
 ISSUE: ​Whether the determination of the court would be valid without
hearing on the report of the Commissioners.

RULING: The trial court and the Court of Appeals fixed the value of the land at
P400.00 per square meter, which was the selling price of lots in the adjacent fully
developed subdivision, the Santo Domingo Village Subdivision. The parcels of land
sought to be expropriated, however, are undeniably idle, undeveloped, raw
agricultural land, bereft of any improvement. Except for the Henson family, all the
other landowners were admittedly farmer beneficiaries under operation land
transfer of the Department of Agrarian Reform.

However, the land has been reclassified as residential. The nature and character of
the land at the time of its taking is the principal criterion to determine just
compensation to the landowner. Unfortunately, the trial court, after creating a
board of commissioners to help it determine the market value of the land did not
conduct a hearing on the report of the commissioners. The trial court fixed the fair
market value of subject land in an amount equal to the value of lots in the adjacent
fully developed subdivision. This finds no support in the evidence. The valuation
was even higher than the recommendation of anyone of the commissioners
(Commissioner Mariano C. Tiglao fixed the fair market value at P350.00
per square meter, while Commissioner Arnold P. Atienza fixed it at P375.00 per
square meter, and Commissioner Victorino Oracio fixed it at P170.00 per square
meter). Commissioner Atienza's recommendation appears to be the closest
valuation to the market value of lots in the adjoining fully developed subdivision.
Considering that the subject parcels of land are undeveloped raw land, the price of
P375.00 per square meter would appear to the Court as the just compensation for
the taking of such raw land.

44. Napocor v. Sps. De La Cruz GR. No. 156093

FACTS:​ Petitioner NAPOCOR is a government-owned and controlled corporation created under

Republic Act No. 6395, as amended, with the mandate of developing hydroelectric power, producing
transmission lines, and developing hydroelectric power throughout the Philippines. NAPOCOR
decided to acquire an easement of right-of-way over portions of land within the areas of Dasmariñas
and Imus, Cavite for the construction and maintenance of the proposed Dasmariñas-Zapote 230 kV
Transmission Line Project. On November 27, 1998, petitioner led a Complaint for eminent domain
and expropriation of an easement of right-of-way against respondents as registered owners of the
parcels of land sought to be expropriated. The affected areas were 51.55, 18.25, and 14.625 square
meters, respectively, or a total of 84.425 square meters. After respondents led their respective
answers to petitioner’s Complaint, petitioner deposited PhP 5,788.50 to cover the provisional value of
the land in accordance with Section 2, Rule 67 of the Rules of Court. Then, on February 25, 1999,
petitioner led an Urgent Ex-Parte Motion for the Issuance of a Writ of Possession, which the trial
court granted in its March 9, 1999 Order However, the trial court dropped the Dela Cruz spouses and
their mortgagee, Metrobank, as parties-defendants in its May 11, 1999 Order, 6 in view of the Motion
to Intervene led by respondent/intervenor Virgilio M. Saulog, who claimed ownership of the land
sought to be expropriated from respondents spouses Dela Cruz.The trial court terminated the pre-trial
in so far as respondent Ferrer was concerned, considering that the sole issue was the amount of just
compensation. As to the just compensation for the property of Saulog, successor-in- interest of the
Dela Cruz spouses, the trial court ordered the latter and petitioner to submit their compromise
agreement. The commissioners conducted an ocular inspection of S.K. Dynamics’ property, and on
October 8, 1999, they submitted a report to the trial court and recommended that the property of S.K.
Dynamics to be expropriated by petitioner be valued at PhP 10,000.00 per square meter.
The records show that the commissioners did not afford the parties the opportunity to introduce
evidence in their favor, nor did they conduct hearings before them. In fact, the commissioners did not
issue notices to the parties to attend hearings nor provide the concerned parties the opportunity to
argue their respective causes. Upon the submission of the commissioners’ report, petitioner was not
notied of the completion or ling of it nor given any opportunity to le its objections to it. On
December 1, 1999, respondent Ferrer led a motion adopting in toto the commissioners’ report with
respect to the valuation of his property. On December 28, 1999, the trial court consequently issued the
Order approving the commissioners’ report, and granted respondent Ferrer’s motion to adopt the
subject report. Subsequently, the just compensation for the disparate properties to be expropriated by
petitioner for its project was uniformly pegged at PhP 10,000.00 per square meter.
Incidentally, on February 11, 2000, respondent S.K. Dynamics led a motion informing the trial court
that in addition to the portion of its property covered by TCT No. T-454278 sought to
be expropriated by petitioner, the latter also took possession of an 8.55-square meter portion of S.K.
Dynamics’ property covered by TCT No. 503484 for the same purpose––to acquire an easement of
right-of-way for the construction and maintenance of the proposed Dasmariñas- Zapote 230 kV
Transmission Line Project. Respondent S.K. Dynamics prayed that said portion be included in the
computation of the just compensation to be paid by petitioner.The Imus, Cavite RTC granted S.K.
Dynamics’ motion to have the 8.55-square meter portion of its property included in the computation
of just compensation. The Regional Trial Court xed the just compensation to be paid by petitioner at
PhP 10,000.00 per square meter. On January 20, 2000, petitioner led a Motion for Reconsideration
of the above mentioned Order, but said motion was denied in the trial court’s March 23, 2000 Order.
Unsatised with the amount of just compensation, petitioner led an appeal before the CA. The Court
of Appeals affirmed the decision of RTC.

ISSUE:​ Whether or not the valuation of just compensation herein was not based from the evidence
on record and other authentic documents.

RULING:​ ​The legal basis for the determination of just compensation was insufficient
In this case, it is not disputed that the commissioners recommended that the just compensation be
pegged at PhP 10,000.00 per square meter. The commissioners arrived at the gure in question after
their ocular inspection of the property, wherein they considered the surrounding structures, the
property’s location and, allegedly, the prices of the other, contiguous real properties in the area.
Furthermore, based on the commissioners’ report, the recommended just compensation was
determined as of the time of the preparation of said report on October 5, 1999.

In B.H. Berkenkotter & Co. v. Court of Appeals, we held, thus:

 Just compensation is dened as the full and fair equivalent of the property sought to be expropriated.
The measure is not the taker’s gain but the owner’s loss. The compensation, to be just, must be fair
not only to the owner but also to the taker. Even as undervaluation would deprive the owner of his
property without due process, so too would its overvaluation unduly favor him to the prejudice of the
public. To determine just compensation, the trial court should rst ascertain the market value of the
property, to which should be added the consequential damages after deducting therefrom the
consequential benets which may arise from the expropriation. If the consequential benets exceed
the consequential damages, these items should be disregarded altogether as the basic value of the
property should be paid in every case.
The market value of the property is the price that may be agreed upon by parties willing but not
compelled to enter into the contract of sale. Not unlikely, a buyer desperate to acquire a piece of
property would agree to pay more, and a seller in urgent need of funds would agree to accept less,
than what it is actually worth. x x x

Among the factors to be considered in arriving at the fair market value of the property are the cost of
acquisition, the current value of like properties, its actual or potential uses, and in the particular case
of lands, their size, shape, location, and the tax declarations thereon. It is settled that just
compensation is to be ascertained as of the time of the taking, which usually coincides with the
commencement of the expropriation proceedings. Where the institution of the action precedes entry
into the property, the just compensation is to be ascertained as of the time of the ling of the
complaint. We note that in this case, the ling of the complaint for expropriation preceded the
petitioner’s entry into the property.
Therefore, it is clear that in this case, the sole basis for the determination of just
compensation was the commissioners’ ocular inspection of the properties in question, as gleaned from
the commissioners’ October 5, 1999 report. The trial court’s reliance on the said report is a serious
error considering that the recommended compensation was highly speculative and had no strong
factual moorings. For one, the report did not indicate the fair market value of the lots occupied by the
Orchard Golf and Country Club, Golden City
Subdivision, Arcontica Sports Complex, and other business establishments cited.
Furthermore, the commissioners’ report itself is awed considering that its recommended just
compensation was pegged as of October 5, 1999, or the date when the said report was issued, and not
the just compensation as of the date of the ling of the complaint for expropriation, or as of
November 27, 1998.
Clearly, the legal basis for the determination of just compensation in this case is
insufficient as earlier enunciated.

45. Leca Realty v. Republic GR No. 155605

FACTS: ​On 18 March 1996, the Republic of the Philippines, represented by the
Department of Public Works and Highways (DPWH), filed a complaint for eminent
domain for the taking of some portions of the properties of Leca Realty Corp. (Leca),
Leeleng Realty Inc. (Leeleng), Metropolitan Bank and Trust Co. (Metrobank), Bank
of the Philippine Islands (BPI), and Cityland Inc. (Cityland). The said properties
would be affected by the construction of the EDSA-Shaw Boulevard Overpass Project
in Shaw Boulevard, Mandaluyong City, a public purpose to be undertaken by the
DPWH.

Attached to the complaint is, among other things, Resolution No. 94-1 of the City
Appraisal Committee of Mandaluyong, which was created to appraise the properties
that would be affected by the construction of the project in question. In the said
resolution, the City Appraisal Committee fixed the fair market values of defendants'
properties, as follows:

'1. All lots situated along Shaw Boulevard from Edsa going westward towards
Manila up to Samat Street, that City, at THIRTY FIVE THOUSAND PESOS
(P35,000) per square meter[.]

The property of defendant-appellant Leca is approximately 297.00 meters from the

intersection of Shaw Boulevard and EDSA

On October 7, 1997, the court a quo appointed three (3) competent and disinterested
persons; namely, Atty. Benjamin C. Angeles, Mr. Joselito E. Gunio and Mr. Melchor
Savillo as commissioners to ascertain and report the just compensation of the
properties sought to be taken. On January 9, 1998, the commissioners submitted
their report dated January 8, 1998, and recommended the fair market value of the
subject properties as follows:

'1. Properties of Leca Realty Corporation and Leeleng Realty Inc.: P50,000
per sq.m.

In arriving at the said Report, the Commissioners took into consideration the
following factors: property location, identification[,] neighborhood data, community
facilities and utilities, highest and best use, valuation and reasonable indication of
land values within the vicinity.

ISSUE:
WON the Commissioner’s report with regards to the valuation of the
properties of Leca Realty Corp is valid.

RULING:​ ​ No. The values arrived at in the Commissioners' Report were not
supported by sufficient evidence. Moreover, they were allegedly based on newspaper
listings of advertisements,​29​ which the commissioners deemed to be reasonable
indices of the fair market value. Further, mere offers of sale -- not consummated
transactions
In expropriation proceedings in general, the market value is the just compensation to
which the owner of a condemned property is entitled. More precisely, ​market value
is "that sum of money which a person desirous but not compelled to buy, and an
owner willing but not compelled to sell, would agree on as a price to be given and
received therefor. The Commissioners' Report relied heavily on newspaper
advertisements of offers of sale of properties in the vicinity. Clearly, these offers were
merely asking prices. By their very nature, they are subject to negotiations in which a
buyer may ask for a lower price; understandably, it is customary for the owner to
raise the price offer.

Cristine Chuck
46. NPC VS ANGAS 208 SCRA 196 (1992)
47. Wycoco v. Judge Caspillo GR. 146733
48. City of Manila v. Oscar Serrano GR. 142304
49. Republic v. Gingoyon GR. No. 166429
50. CIR VS. ALGUE INC 158 SCRA 9 (1998)

NATIONAL POWER CORPORATION VS. ANGAS [GR 60225-26, 8 MAY 1992]

Second Division, Paras (J): 4 concur

Facts:
On 13 April and 3 December 1974, the National Power Corporation (NAPOCOR), a government owned
and controlled corporation and the agency through which the government undertakes the on-going
infrastructure and development projects throughout the country, filed two complaints for eminent
domain with the Court of First Instance (now Regional Trial Court) of Lanao del Sur (against
Lacsamana Batugan, and/or Guimba Shipping & Development Corporation, Magancong Digayan,
Moctara Lampaco, Lampaco Pasandalan, Dimaporo Subang, Hadji Daluma Kinidar, Dimaampao
Baute, Pangonotan Cosna Tagol, Salacop Dimacaling, Hadji Sittie Sohra Linang Batara, Bertudan
Pimping And/Or Cadurog Pimping, Butuan Tagol, Constitutional Law II, 2005 ( 41 ) Narratives (Berne
Guerrero) Disangcopan Marabong, and Hadji Salic Sawa in Civil Case 2248; and against Mangorsi
Casan, Casnangan Batugan, Pundamarug Atocal, Pasayod Pado, Dimaampao Baute, Casnangan
Baute, Dimaporo Subang, Tambilawan Ote, Manisun Atocal, and Masacal Tomiara in Civil Case
2277). The complaint which sought to expropriate certain specified lots situated at Limogao,
Saguiaran, Lanao del Sur was for the purpose of the development of hydro-electric power and
production of electricity as well as the erection to such subsidiary works and constructions as may be
necessarily connected therewith. Both cases were jointly tried upon agreement of the parties. After a
series of hearings were held, on 15 June 1979, a consolidated decision was rendered by the lower
court, declaring and confirming that the lots mentioned and described in the complaints have entirely
been lawfully condemned and expropriated by NAPOCOR, and ordering the latter to pay the
landowners certain sums of money as just compensation for their lands expropriated "with legal
 interest thereon until fully paid. Two consecutive motions for reconsideration of the consolidated
decision were filed by NAPOCOR. The same were denied by the court. NAPOCOR did not appeal on
the consolidated decision, which became final and executory. Thus, on 16 May 1980, one of the
landowners (Sittie Sohra Batara) filed an ex-parte motion for the execution of the decision, praying that
petitioner be directed to pay her the unpaid balance of P14, 300.00 for the lands expropriated from her,
including legal interest which she computed at 6% per annum. The said motion was granted by the
lower court. Thereafter, the lower court directed the petitioner to deposit with its Clerk of Court the
sums of money as adjudged in the joint decision dated 15 June 1979. NAPOCOR complied with said
order and deposited the sums of money with interest computed at 6% per annum. On 10 February
1981, another landowner (Pangonatan Cosna Tagol) filed with the trial court an exparte motion
praying, for the first time, that the legal interest on the just compensation awarded to her by the court
be computed at 12% per annum as allegedly "authorized under and by virtue of Circular 416 of the
Central Bank issued pursuant to Presidential Decree 116 and in a decision of the Supreme Court that
legal interest allowed in the judgment of the courts, in the absence of express contract, shall be
computed at 12% per annum." On 11 February 1981, the lower court granted the said motion allowing
12% interest per annum. Subsequently, the other landowners filed motions also praying that the legal
interest on the just compensation awarded to them be computed at 12% per annum, on the basis of
which the lower court issued on 10 March 1981 and 28 August 1981 orders bearing similar import.
NAPOCOR moved for the reconsideration of the lower court's last order dated 28 August 1981, which
the court denied on 25 January 1982. NAPOCOR filed a petition for certiorari and mandamus with the
Supreme Court.

Issue: Whether, in the computation of the legal rate of interest on just compensation for expropriated lands,
the rate applicable as legal interest is 6% (Article 2209 of the Civil Code) or 12% (Central Bank
Circular 416).

Held:
Article 2209 of the Civil Code, which provides that "If the obligation consists in the payment of a sum of
money, and the debtor incurs a delay, the indemnity for damages, there being no stipulation to the
contrary, shall be the payment of the interest agreed upon, and in the absence of stipulation, the legal
interest, which is six percent per annum," and not Central Bank Circular 416, is the law applicable. The
Central Bank circular applies only to loan or forbearance of money, goods or credits and to judgments
involving such loan or forbearance of money, goods or credits. This is evident not only from said
circular but also from Presidential Decree 116, which amended Act 2655, otherwise known as the
Usury Law. On the other hand, Article 2209 of the Civil Code applies to transactions requiring the
payment of indemnities as damages, in connection with any delay in the performance of the obligation
arising therefrom other than those covering loan or forbearance of money, goods or credits. Herein,
the transaction involved is clearly not a loan or forbearance of money, goods or credits but
expropriation of certain parcels of land for a public purpose, the payment of which is without stipulation
regarding interest, and the interest adjudged by the trial court is in the nature of indemnity for
damages. The legal interest required to be paid on the amount of just compensation for the properties
expropriated is manifestly in the form of indemnity for damages for the delay in the payment thereof.
Therefore, since the kind of interest involved in the joint judgment of the lower court sought to be
enforced in this case is interest by way of damages, and not by way of earnings from loans, etc. Article
2209 of the Civil Code shall apply.

WYCOCO V. JUDGE CASPILLO [G.R. No. 146733, January 13, 2004]

FACTS:
Felciano Wycoco owned 94.1690 hectares unirrigated and untenanted rice land. TCT No. NT.206422 and
voluntarily offered to sell the land to Department of Agrarian Reform (DAR) in line with the (CARP) for
P14.9M. A notice of intention to acquire 84.5690 hectares for P1, 342, 667.46 by the DAR sent to him.
The amount raised to P2,594,045.39 and later modified to P2,280,159.82 excluded the idle areas.
He refused and prompted the DAR to indorse the case to DARAB, fixing the just compensation.
DARAB requested the LBP to open a trust account for Wycoco and deposited the
compensation offered by the DAR and the properties were distributed to the beneficiaries. On April
 30, 93 he filed a manifestation in VOS case no. 232 NE 93 while Cabanatuan Court acting as the
Special Agrarian Court.

ISSUES:
1. Whether or not the RTC of Cabanatuan has jurisdiction over the case.
2. Whether or not there was a just compensation offered to the plaintiff.

HELD:
Point out that there‘s no need for Wycoco to present an evidence in support of the land valuation in as
much as it is in public knowledge that the prevailing market value of agricultural lands in Nueva
Ecija is from P135,000.00 to P150,000.00 per hectare. So the curt fixed the compensation of:
P142,500.00 per hectare 94.1690, hectares (land size) P13,428,082 and a total compensation +
actual damages P29,663,235.00 for unrealized profits and P8,475,210.00 legal interest.
This must be paid by DAR. DAR and LBP filed a separate petition before the CA and dismissed on
May 29,97. Final execution June 6,07 and Feb. 9,99 respectively. The dismissal prompted Wycoco to
file a petition for mandamus before SC praying the execution of Cabanatuan court‘s decision and
compelled Judge Caspillon to inhibit himself from the hearing of the case. CA modified the decision,
deducted the compensation due to Wycoco the amount corresponding to 3.372 hectares for it
was found to have been previously sold to Republic.

Sec 50 and 57 of R.A. 6657 (Comprehensive Agrarian Reform law of 1988). DAR as an administrative
agency cannot be granted jurisdiction over the cases of eminent domain and over criminal
cases. The valuation of property in eminent domain is essentially a judicial function which is
vested with the Special Agrarian Courts and cannot lodge with administrative agencies.
Rule XIII Sec.II of New Rules of Procedures of DARAB Sec.II... just compensation shall not be appealable
to the Board but shall be brought directly to the RTC designated as Special
Agrarian Court. So, RTC or Cabanatuan has jurisdiction over the case at bar because it is the designated
as SAC.
RTC should have allowed the parties to present evidences so a fair compensation shall be
determined. There are factors to be considered such as the cost of acquisition, size, shape,
location and tax declaration, for ignoring the said factors, remand of the case for determination is
necessary. This case be remanded to RTC for the determination of just compensation

REPUBLIC VS GINGOYON

FACTS:
The construction of the NAIA 3 had spawned controversies that had its roots with the promulgation of the
Court‘s decision in Agan vs PIATCO (2003 decision), which nullified the contract between the
Government and the contractor (PIATCO) for being contrary to law and public policy. At the time of
the promulgation of the 2003 decision, the NAIA 3 facilities had already been built by PIATCO and
were nearing completion and several respondents filed their respective motions for the reconsideration
of the 2003 Decision but were denied by the Court in its Resolution dated 21 January 2004. However,
the Court this time squarely addressed the issue of the rights of PIATCO to refund,
compensation or reimbursement for its expenses in the construction of the NAIA 3 facilities. After the
promulgation of the rulings in Agan, the NAIA 3 facilities have remained in the possession of PIATCO.
On December 21, 2004, the Government filed a Complaint for expropriation with the Pasay City
Regional Trial Court (RTC).The Government sought for the issuance of a writ of possession
authorizing it to take immediate possession and control over the NAIA 3 facilities.
The Government also declared that it had deposited 3 Billion in cash with the Land Bank of the
Philippines, representing the assessed value for taxation purposes. This was the case now presided
by Honorable Gingoyon. On the same day that the complaint was filed, the RTC issued an
Order directing the issuance of a writ of possession to the Government, authorizing it to "take or
enter upon the possession" of the NAIA 3 facilities. This decision was based on Section 2, Rule 67
of the 1997 Rules of Civil Procedure, which prescribes that the initial deposit be equivalent to
the assessed value of the property for purposes of taxation, however this was amended by
 Republic Act No. 8974. RA 8974 provides that as the relevant standard for initial compensation,
the market value of the property as stated in the tax declaration or the current relevant zonal
valuation of the Bureau of Internal Revenue (BIR), whichever is higher, and the value of the
improvements and/or structures using the replacement cost method.
On the basis of RA 8974, the RTC directed first, that the Land Bank of the Philippines, Baclaran Branch,
immediately release the amount of US$62,343,175.77 to PIATCO. Second, the Government was
directed to submit to the RTC a Certificate of Availability of Funds signed by authorized
officials to cover the payment of just compensation. Third, the Government was directed "to maintain,
preserve and safeguard" the NAIA 3 facilities or "perform such as acts or activities in preparation for
their direct operation" of the airport terminal, pending expropriation proceedings and full payment of
just compensation. The Government was also not allowed to perform acts of ownership like leasing
any part of NAIA 3 to other parties. The Government filed an Urgent Motion for Reconsideration on the
assailed January 4, 2005 order. On 7 January 2005, the RTC issued another Order, the second
now assailed before this Court, which appointed 3 Commissioners to ascertain the amount of
just compensation for the NAIA 3 Complex.
And on the same day the Government issued a Motion for Inhibition of Hon. Gingoyon. These motions
were heard by the RTC but were denied in an Omnibus Order dated January 10, 2005. Thus the
present
petition for Certiorari for the nullification of the RTC orders dated January 4, 7 and 10, 2005 and for
the inhibition of Hon. Gingoyon from taking further action on the expropriation case.

ISSUE:
Whether Rule 67 of the Rules of Court or Rep. Act No. 8974 governs the expropriation proceedings in this
case.

HELD:
Rep. Act No. 8974 applies in this case, particularly insofar as it requires the immediate payment
by the Government of at least the proffered value of the NAIA 3 facilities to PIATCO and
provides certain valuation standards or methods for the determination of just compensation.
Since funds have been spent by PIATCO in their construction, for the take over the said facility, it has
to compensate respondent PIATCO as builder of the said structures. The compensation must be just
and in accordance with law and equity for the government cannot unjustly enrich itself at the
expense of PIATCO and its investors.

Sec 2 Rule 67, states that plaintiff shall have the right to take or enter upon the possession of the
real property involved if he deposits with the authorized government depositary an amount
equivalent to the assessed value of the property for purposes of taxation to be held by such
bank subject to the orders of the court.

In contrast, Section 4 of Rep. Act No. 8974 relevantly states: Upon the filing of the complaint, and after
due notice to the defendant, the implementing agency shall immediately pay the
owner of the property the amount equivalent to the sum of one hundred percent of the value of the
property based on the current relevant zonal valuation of the Bureau of Internal Revenue; and
the value of the improvements and/or structures as determined under Section 7.

If Sec2 Rule 67 applies then PIATCO would be enjoined from receiving a single centavo as just
compensation before the Government takes over the NAIA 3 facility by virtue of a writ of
possession.

Hence the Court ruled that just compensation should be made before the Government may take over the
NAIA 3.

CITY OF MANILA, VS. SERRANO [GR 142304, 20 JUNE 2001]

Second Division, Mendoza (J): 4 concur

Facts:
On 21 December 1993, the City Council of Manila enacted Ordinance 7833, authorizing the expropriation
of certain properties in Manila's First District in Tondo, covered by TCTs 70869, 105201, 105202, and
138273 of the Register of Deeds of Manila, which are to be sold and distributed to qualified occupants
pursuant to the Land Use Development Program of the City of Manila. One of the properties sought to
be expropriated, denominated as Lot 1-C, consists of 343.10 square meters, and was in the name of
Feliza de Guia. Lot 1-C was assigned to Edgardo De Guia, one of the heirs of Alberto De Guia, in turn
one of the heirs of Feliza de Guia. On 29 July 1994, the said property was transferred to Lee Kuan Hui,
in whose name TCT 217018 was issued. The property was subsequently sold on 24 January 1996 to
Demetria De Guia to whom TCT 226048 was issued. On 26 September 1997, the City of Manila filed
an amended complaint for expropriation (Civil Case 94-72282) with the Regional Trial Court, Branch
16, Manila, against the supposed owners of the lots covered by TCTs 70869 (including Lot 1-C),
105201, 105202, and 138273, which included herein respondents Oscar, Felicitas, Jose, Benjamin,
Estelita, Leonora, Adelaida, all surnamed Serrano. On 12 November 1997, the Serranos filed a
consolidated answer, praying the exemption of Lot 1-C from expropriation. Upon motion by the City,
the trial court issued an order, dated 9 October 1998, directing the City to deposit the amount of
P1,825,241.00 equivalent to the assessed value of the properties. After the City had made the deposit,
the trial court issued another order, dated 15 December 1998, directing the issuance of a writ of
possession in favor of the City. The Serranos filed a petition for certiorari with the Court of Appeals. On
16 November 1999, the Court of Appeals rendered a decision holding that although Lot 1-C is not
exempt from expropriation because it undeniably exceeds 300 square meters which is no longer
considered a small property within the framework of RA 7279, the other modes of acquisition of lands
enumerated in §§59-10 of the law must first be tried by the city government before it can resort to
expropriation, and thus enjoined the City from expropriating Lot 1-C. In its resolution, dated 23
February 2000, the Court of Appeals likewise denied two motions for reconsideration filed by the City.
The City filed a petition for review on certiorari before the Supreme Court.

Issue: Whether it was premature to determine whether the requirements of RA 7279, §§9-10 have been
complied with.

Held:
Rule 67, §2 provides that "Upon the filing of the complaint or at any time thereafter and after due notice to
the defendant, the plaintiff shall have the right to take or enter upon the possession of the real property
involved if he deposits with the authorized government depositary an amount equivalent to the
assessed value of the property for purposes of taxation to be held by such bank subject to the orders
of the court. Such deposit shall be in money, unless in lieu thereof the court authorizes the deposit of a
certificate of deposit of a government bank of the Republic of the Philippines payable on demand to
the authorized government depositary. If personal property is involved, its value shall be provisionally
ascertained and the amount to be deposited shall be fixed by the court. After such deposit is made the
court shall order the sheriff or other proper officer to forthwith place the plaintiff in possession of the
property involved and promptly submit a report thereof to the court with service of copies to the
parties." Thus, a writ of execution may be issued by a court upon the filing by the government of a
complaint for expropriation sufficient in form and substance and upon deposit made by the government
of the amount equivalent to the assessed value of the property subject to expropriation. Upon
compliance with these requirements, the issuance of the writ of possession becomes ministerial.
Herein, these requirements were satisfied and, therefore, it became the ministerial duty of the trial
court to issue the writ of possession. The distinction between the Filstream and the present case is
that in the former, the judgment in that case had already become final while herein, the trial court has
not gone beyond the issuance of a writ of possession. Hearing is still to be held to determine whether
or not petitioner indeed complied with the requirements provided in RA 7279. Whether the City has
complied with these provisions requires the presentation of evidence, although in its amended
complaint petitioner did allege that it had complied with the requirements. The determination of this
question must await the hearing on the complaint for expropriation, particularly the hearing for the
condemnation of the properties sought to be expropriated. Expropriation proceedings consists of two
stages: first, condemnation of the property after it is determined that its acquisition will be for a public
purpose or public use and, second, the determination of just compensation to be paid for the taking of
private property to be made by the court with the assistance of not more than three commissioners.
COMMISSIONER OF INTERNAL REVENUE VS. ALGUE INC.
GR No. L-28896 | Feb. 17, 1988

Facts:
Algue Inc. is a domestic corp engaged in engineering, construction and other allied activities. On Jan. 14,
1965, the corp received a letter from the CIR regarding its delinquency income taxes from 1958-1959,
amounting to P83,183.85. A letter of protest or reconsideration was filed by Algue Inc on Jan 18. On
March 12, a warrant of distraint and levy was presented to Algue Inc. thru its counsel, Atty. Guevara,
who refused to receive it on the ground of the pending protest. Since the protest was not found on the
records, a file copy from the corp was produced and given to BIR Agent Reyes, who deferred service
of the warrant. On April 7, Atty. Guevara was informed that the BIR was not taking any action on the
protest and it was only then that he accepted the warrant of distraint and levy earlier sought to be
served. On April 23, Algue filed a petition for review of the decision of the CIR with the Court of Tax
Appeals. CIR contentions: the claimed deduction of P75,000.00 was properly disallowed because it
was not an ordinary reasonable or necessary business expense and payments are fictitious because
most of the payees are members of the same family in control of Algue and that there is not enough
substantiation of such payments. CTA: 75K had been legitimately paid by Algue Inc. for actual services
rendered in the form of promotional fees. These were collected by the Payees for their work in the
creation of the Vegetable Oil Investment Corporation of the Philippines and its subsequent purchase of
the properties of the Philippine Sugar Estate Development Company.

Issue: W/N the Collector of Internal Revenue correctly disallowed the P75,000.00 deduction claimed by
Algue as legitimate business expenses in its income tax returns

Ruling:
Taxes are the lifeblood of the government and so should be collected without unnecessary hindrance,
made in accordance with law. RA 1125: the appeal may be made within thirty days after receipt of the
decision or ruling challenged. During the intervening period, the warrant was premature and could
therefore not be served. Originally, CIR claimed that the 75K promotional fees to be personal holding
company income, but later on conformed to the decision of CTA. There is no dispute that the payees
duly reported their respective shares of the fees in their income tax returns and paid the corresponding
taxes thereon. CTA also found, after examining the evidence, that no distribution of dividends was
involved. CIR suggests a tax dodge, an attempt to evade a legitimate assessment by involving an
imaginary deduction. Algue Inc. was a family corporation where strict business procedures were not
applied and immediate issuance of receipts was not required. at the end of the year, when the books
were to be closed, each payee made an accounting of all of the fees received by him or her, to make
up the total of P75,000.00. This arrangement was understandable in view of the close relationship
among the persons in the family corporation. The amount of the promotional fees was not excessive.
The total commission paid by the Philippine Sugar Estate Development Co. to Algue Inc. was P125K.
After deducting the said fees, Algue still had a balance of P50,000.00 as clear profit from the
transaction. The amount of P75,000.00 was 60% of the total commission. This was a reasonable
proportion, considering that it was the payees who did practically everything, from the formation of the
Vegetable Oil Investment Corporation to the actual purchase by it of the Sugar Estate properties. Sec.
30 of the Tax Code: allowed deductions in the net income – Expenses - All the ordinary and necessary
expenses paid or incurred during the taxable year in carrying on any trade or business, including a
reasonable allowance for salaries or other compensation for personal services actually rendered. The
burden is on the taxpayer to prove the validity of the claimed deduction.
In this case, Algue Inc. has proved that the payment of the fees was necessary and reasonable in the light
of the efforts exerted by the payees in inducing investors and prominent businessmen to venture in an
experimental enterprise and involve themselves in a new business requiring millions of pesos. Taxes
are what we pay for civilization society. Without taxes, the government would be paralyzed for lack of
the motive power to activate and operate it. Hence, despite the natural reluctance to surrender part of
one's hard earned income to the taxing authorities, every person who is able to must contribute his
share in the running of the government. The government for its part, is expected to respond in the form
of tangible and intangible benefits intended to improve the lives of the people and enhance their moral
 and material values. Taxation must be exercised reasonably and in accordance with the prescribed
procedure. If it is not, then the taxpayer has a right to complain and the courts will then come to his
succor

Algue Inc.’s appeal from the decision of the CIR was filed on time with the CTA in accordance with Rep.
Act No. 1125. And we also find that the claimed deduction by Algue Inc. was permitted under the
Internal Revenue Code and should therefore not have been disallowed by the CIR.

Lloyd Alfred Espiña Carpio

51. Commissioner vs Makasiar 177 SCRA 27 (1989)

Facts: On 7 December 1978, the then Court of First Instance of Manila (herein referred to as
CFI-MANILA) issued Search and Seizure Warrants in Criminal Case Nos. 8602 and 8603
entitled “People of the Philippines vs. Howard J. Sosis,, et al.,” for violation of Section 11 (a)
and/or 11(e) of Republic Act No. 3720, * and violation of Article 188 of the Revised Penal Code
(captioned as “Substituting and altering trademarks, tradenames, or service marks”), respectively,
and ordering the seizure. Team from the Ministry of Finance Bureau of Investigation and
Intelligence, the Bureau of Customs and the Integrated National Police enforced the search and
seizure warrant. The said items remained in the Hercules compound guarded. the Collector of
Customs for the Port of Manila, issued a warrant of seizure and detention, in Seizure
Identification No. 2-79, and ordered the immediate seizure and turnover of the seized items to its
Auction and Cargo Disposal Division at the Port of Manila. CFI-MANILA issued an order
authorizing the transfer and delivery of the seized articles to the customs warehouse. Hercules
objected to the continuation by the Collector of Customs of the seizure proceedings claiming,
among others, that these proceedings would hamper or even jeopardize the preliminary
investigation being conducted by the fiscal. Hercules filed a petition for prohibition with
preliminary injunction and/or temporary restraining order with another sala. RTC decided in
favour of Hercules hence the petition.

Issue:
Whether or not respondent judge may enjoin the Collector of Customs from continuing with its
seizure and forfeiture proceedings over goods earlier seized by virtue of search warrants issued by
the CFI-MANILA?

Held:
Decision reversed. The Court must emphasize at this point that the instant case does not involve a
conflict of jurisdictions. Proceedings before the regular courts for criminal prosecutions against
Howard Sosis, et al., and seizure and forfeiture proceedings for the subject goods conducted by
the Bureau of Customs may be maintained simultaneously and independently of each other. For
the nature of the two proceedings are entirely different such that a resolution in one is not decisive
of the issue in the other. The latter, which is administrative and civil in nature, is directed against
the res or articles imported and entails a determination of the legality of its importation. The
former is directed against those persons who may be held liable for violating the penal laws in
connection with the importation.

52. City of Pasig & Crispina Salumbre v. Meralco GR. 181710

Facts:
On 26 December 1992, the Sangguniang Bayan of the Municipality of Pasig enacted Ordinance
No. 25 which, under its Article 3, Section 32, imposed a franchise tax on all business venture
operations carried out through a franchise within the municipality. By virtue of Republic Act
(R.A.) No. 7829, which took effect on 25 January 1995, the Municipality of Pasig was converted
into a highly urbanized city to be known as the City of Pasig. On 24 August 2001, the Treasurer's
Office of the City Government of Pasig informed the Manila Electric Company (MERALCO), a
grantee of a legislative franchise,4 that it is liable to pay taxes for the period 1996 to 1999,
pursuant to Municipal Ordinance No. 25. The city, thereafter, on two separate occasions,
demanded payment of the said tax in the amount of P435,332,196.00, exclusive of penalties.

On 8 February 2002, MERALCO protested the validity of the demand. MERALCO instituted an
action before the RTC for the annulment of the said demand with prayer for a temporary
restraining order and a writ of preliminary injunction. The RTC ruled in favor of the City of
Pasig.

Issue:

Whether the CA was correct in ruling that the City of Pasig had no valid basis for its imposition
of franchise tax for the period 1996 to 1999.

Held:

We answer in the affirmative.

I. Unlike a city, a
municipality is bereft of
authority to levy franchise tax,
thus, the ordinance enacted
for that purpose is void.

The conversion of the

municipality into a city does
not lend validity to the void
ordinance.

Neither does it authorize the

collection of the tax under said
ordinance.

The power to impose franchise tax belongs to the province by virtue of Section 137 of the LGC.
On the other hand, the municipalities are prohibited from levying the taxes specifically allocated
to provinces.

Consequently, the CA was correct when it declared that the demand of the City of Pasig upon
MERALCO for the payment of the disputed tax was devoid of legal basis. It bears emphasizing
that the DOJ and the RTC of Pasig City had previously declared Section 32 of Municipal
Ordinance No. 25 as void ab initio. Even the City of Pasig, it seems, does not contest the
 invalidity of said ordinance.

53. YMCA VS VIR 33 PHIL 217 (1916)

Facts:
YMCA is a non-stock, non-profit institution which conducts various programs and activities that
are beneficial for the public, especially the young people pursuant to its religious, educational and
charitable objectives. YMCA earned an income from leasing a portion of its premises to small
shop owners and from parking fees collected from non-members, upon w/c CIR assessed taxes.
YMCA protested the assessment and got denied. This led to filing for petition for review with
Court of Tax Appeals. CTA decided in favour of YMCA citing that the income from the lease
and fees are reasonably incidental to and reasonably necessary for the accomplishment of the
objectives of YMCA. The earnings from these for the use of recreational facilities constitute the
bulk of its income w/c is used to support its many activities to attain its objectives. CIR elevated
the case to CA w/c reversed CTA decision.

Issue:
Whether or not income of YMCA from lease and fee are exempt from tax?

Held:
The income is not exempt from tax. Under NIRC, the income received by civic league or clubs
not organized for profit are exempt from tax in respect to income received by them. The
exemption does not apply to income derived from any of their properties or any activities
conducted for profit regardless of the disposition made of such income. Because taxes are the
lifeblood of the nation, stict interpretation in construing tax exemptions should be applied.
Exemption “must be granted in a statute stated in a language too clear to be mistaken.”

54. Province of Abra vs. Hernando 107 SCRA 104 (1989)

Facts:
The provincial assessor made a tax assessment on the properties of the Roman Catholic Bishop of
Bangued. The bishop claims tax exemption from real estate tax, through an action for declaratory
relief. A summary judgment was made granting the exemption without hearing the side of the
Province of Abra.

Issue:
Whether the properties of the Bishop of Bangued are tax-exempt.

Held:
The 1935 and the 1973 Constitutions differ in language as to the exemption of religious property
from taxes as tehy should not only be “exclusively” but also “actually” and “directly” used for
religious purposes. Herein, the judge accepted at its face the allegation of the Bishop instead of
demonstrating that there is compliance with the constitutional provision that allows an exemption.
There was an allegation of lack of jurisdiction and of lack of cause of action, which should have
compelled the judge to accord a hearing to the province rather than deciding the case immediately
in favor of the Bishop. Exemption from taxation is not favored and is never presumed, so that if
granted, it must be strictly construed against the taxpayer. There must be proof of the actual and
 direct use of the lands, buildings, and improvements for religious (or charitable) purposes to be
exempted from taxation.

55. Abra vs Valley College vs Aquino 162 SCRA 106 (1988)

Facts:
Abra Valley College is an educational corporation and institution of higher learning in Bangued,
Abra. In 1974, the CFI ordered for the seizure and sale of the subject school property for
non-payment of real estate taxes and penalties. Private respondents stated that the college lot and
building in question are not only used for educational purposes of the college, but also as the
permanent residence of the President and Director, Mr. Pedro V. Borgonia, and his family
including his in-laws and grandchildren; while the ground floor of the college building is being
used and rented by a commercial establishment.

ISSUE:

Whether or not the lot and building in question are used exclusively for educational purposes and
thus exempted from paying taxes.

HELD:

The 1935 Philippine Constitution, Art. VI, par. 3 Sec. 22, expressly grants exemption from realty
taxes for “Cemeteries, churches and parsonages or convents appurtenant thereto, and all lands,
buildings, and improvements used exclusively for religious, charitable or educational purposes….

Thus, the use of the second floor of the main building for residential purposes of the Director and
his family, may find justification under the concept of incidental use, which is complimentary to
the main or primary purpose–educational. The lease of the first floor, however, by a commercial
establishment cannot be considered incidental to the purpose of education.

Under the 1935 Constitution, the trial court correctly arrived at the conclusion that the school
building as well as the lot where it is built, should be taxed, not because the second floor of the
same is being used by the Director and his family for residential purposes, but because the first
floor thereof is being used for commercial purposes.

Alexandrhea Toledo

56. CIR VS DLSU GR. 196596

57. PUNZALAN vs municipal board

58. City of Manila v. Cosmos Bottlin Company Corp. GR. 196681

59. Physical Therapy Org. Vs Municipal Board GR. 10448

60. Corona v. United HArbor Pilots Association of the Phils. 283 SCRA 31 Dec 12, 1997