Payment of just compensation

HLI contends that since the SDP is a modality which the agrarian reform law gives the landowner as alternative to compulsory coverage, then the FWBs cannot be considered as owners and possessors of the agricultural lands of Hacienda Luisita at the time the SDP was approved by PARC.⁴ It further claims that the approval of the SDP is not akin to a Notice of Coverage in compulsory coverage situations because stock distribution option and compulsory acquisition are two (2) different modalities with independent and separate rules and mechanisms. Concomitantly, HLI maintains that the Notice of Coverage issued on January 2, 2006 may, at the very least, be considered as the date of "taking" as this was the only time that the agricultural lands of Hacienda Luisita were placed under compulsory acquisition in view of its failure to perform certain obligations under the SDP.⁵

Mallari, et al. are of a similar view. They contend that Tarlac Development Corporation (Tadeco), having as it were majority control over HLI, was never deprived of the use and benefit of the agricultural lands of Hacienda Luisita. Upon this premise, Mallari, et al. claim the "date of taking" could not be at the time of the approval of the SDP.⁶

A view has also been advanced that the date of the "taking" should be left to the determination of the Department of Agrarian Reform (DAR) in conjunction with its authority to preliminarily determine the just compensation for the land made subject of CARP.

Alyansa ng mga Manggagawang Bukid sa Hacienda Luisita (AMBALA), in its Comment/Opposition (to the Motion to Clarify and Reconsider Resolution of November 22, 2011) dated January 30, 2012, on the other hand, alleges that HLI should not be paid just compensation altogether.⁷ It argues that when the Court of Appeals (CA) dismissed the case⁸ the government of then President Ferdinand E. Marcos initially instituted and won against Tadeco, the CA allegedly imposed as a condition for its dismissal of the action that should the stock distribution program fail, the lands should be distributed to the FWBs, with Tadeco receiving by way of compensation only the amount of PhP 3,988,000.⁹

AMBALA further contends that if HLI or Tadeco is, at all, entitled to just compensation, the "taking" should be reckoned as of November 21, 1989, the date when the SDP was approved, and the amount of compensation should be PhP 40,000 per hectare as this was the same value declared in 1989 by Tadeco to ensure that the FWBs will not control the majority stockholdings in HLI.¹⁰

At the outset, it should be noted that Section 2, Rule 52 of the Rules of Court states, "No second motion for reconsideration of a judgment or final resolution by the same party shall be entertained." A second motion for reconsideration, as a rule, is prohibited for being a mere reiteration of the issues assigned and the arguments raised by the parties.¹¹

In the instant case, the issue on just compensation and the grounds HLI and Mallari, et al. rely upon in support of their respective stance on the matter had been previously raised by them in their first motion for reconsideration and fully passed upon by the Court in its November 22, 2011 Resolution. The similarities in the issues then and now presented and the grounds invoked are at once easily discernible from a perusal of the November 22, 2011 Resolution, the pertinent portions of which read:

In Our July 5, 2011 Decision, We stated that "HLI shall be paid just compensation for the remaining agricultural land that will be transferred to DAR for land distribution to the FWBs." We also ruled that the date of the "taking" is November 21, 1989, when PARC approved HLI’s SDP per PARC Resolution No. 89-12-2.

In its Motion for Clarification and Partial Reconsideration, HLI disagrees with the foregoing ruling and contends that the "taking" should be reckoned from finality of the Decision of this Court, or at the very least, the reckoning period may be tacked to January 2, 2006, the date when the Notice of Coverage was issued by the DAR pursuant to PARC Resolution No. 2006-34-01 recalling/revoking the approval of the SDP.

For their part, Mallari, et al. argue that the valuation of the land cannot be based on November 21, 1989, the date of approval of the SDP. Instead, they aver that the date of "taking" for valuation purposes is a factual issue best left to the determination of the trial courts.

At the other end of the spectrum, AMBALA alleges that HLI should no longer be paid just compensation for the agricultural land that will be distributed to the FWBs, since the Manila Regional Trial Court (RTC) already rendered a decision ordering the Cojuangcos to transfer the control of Hacienda Luisita to the Ministry of Agrarian Reform, which will distribute the land to small farmers after compensating the landowners P3.988 million. In the event, however, that this Court will rule that HLI is indeed entitled to compensation, AMBALA contends that it should be pegged at forty thousand pesos (PhP 40,000) per hectare, since this was the same value that Tadeco declared in 1989 to make sure that the farmers will not own the majority of its stocks.

Despite the above propositions, We maintain that the date of "taking" is November 21, 1989, the date when PARC approved HLI’s SDP per PARC Resolution No. 89-12-2, in view of the fact that this is the time that the FWBs were considered to own and possess the agricultural lands in Hacienda Luisita. To be precise, these lands became subject of the agrarian reform coverage through the stock distribution scheme only upon the approval of the SDP, that is, November 21, 1989. Thus, such approval is akin to a notice of coverage ordinarily issued under compulsory acquisition. Further, any doubt should be resolved in favor of the FWBs. As this Court held in Perez-Rosario v. CA:

It is an established social and economic fact that the escalation of poverty is the driving force behind the political disturbances that have in the past compromised the peace and security of the people as well as the continuity of the national order. To subdue these acute disturbances, the legislature over the course of the history of the nation passed a series of laws calculated to accelerate agrarian reform, ultimately to raise the material standards of living and eliminate discontent. Agrarian reform is a perceived solution to social instability. The edicts of social justice found in the Constitution and the public policies that underwrite them, the extraordinary national experience, and the prevailing national consciousness, all command the great departments of government to tilt the balance in favor of the poor and underprivileged whenever reasonable doubt arises in the interpretation of the law. But annexed to the great and sacred charge of protecting the weak is the diametric function to put every effort to arrive at an equitable solution for all parties concerned: the jural postulates of social justice cannot shield illegal acts, nor do they sanction false sympathy towards a certain class, nor yet should they deny justice to the landowner whenever truth and justice happen to be on her side. In the occupation of the legal questions in all agrarian disputes whose outcomes can significantly affect societal harmony, the considerations of social advantage must be weighed, an inquiry into the prevailing social interests is necessary in the adjustment of conflicting demands and expectations of the people, and the social interdependence of these interests, recognized. (Emphasis and citations omitted.)

Considering that the issue on just compensation has already been passed upon and denied by the Court in its November 22, 2011 Resolution, a subsequent motion touching on the same issue undeniably partakes of a second motion for reconsideration, hence, a prohibited pleading, and as such, the motion or plea must be denied. Sec. 3 of Rule 15 of the Internal Rules of the Supreme Court is clear:

SEC. 3. Second motion for reconsideration. – The Court shall not entertain a second motion for reconsideration, and any exception to this rule can only be granted in the higher interest of justice by the Court en banc upon a vote of at least two-thirds of its actual membership. There is reconsideration "in the higher interest of justice" when the assailed decision is not only legally erroneous, but is likewise patently unjust and potentially capable of causing unwarranted and irremediable injury or damage to the parties. A second motion for reconsideration can only be entertained before the ruling sought to be reconsidered becomes final by operation of law or by the Court’s declaration.

In the Division, a vote of three Members shall be required to elevate a second motion for reconsideration to the Court En Banc.

Nonetheless, even if we entertain said motion and examine the arguments raised by HLI and Mallari, et al. one last time, the result will be the same.

Sec. 4, Article XIII of the 1987 Constitution expressly provides that the taking of land for use in the agrarian reform program of the government is conditioned on the payment of just compensation. As stated:

Section 4. The State shall, by law, undertake an agrarian reform program founded on the right of farmers and regular farm workers, who are landless, to own directly or collectively the lands they till or, in the case of other farm workers, to receive a just share of the fruits thereof. To this end, the State shall encourage and undertake the just distribution of all agricultural lands, subject to such priorities and reasonable retention limits as the Congress may prescribe, taking into account ecological, developmental, or equity considerations, and subject to the payment of just compensation. (Emphasis supplied.)

Just compensation has been defined as "the full and fair equivalent of the property taken from its owner by the expropriator."¹² The measure is not the taker’s gain, but the owner’s loss.¹³ In determining just compensation, the price or value of the property at the time it was taken from the owner and appropriated by the government shall be the basis. If the government takes possession of the land before the institution of expropriation proceedings, the value should be fixed as of the time of the taking of said possession, not of the filing of the complaint.¹⁴

In Land Bank of the Philippines v. Livioco, the Court held that "the ‘time of taking’ is the time when the landowner was deprived of the use and benefit of his property, such as when title is transferred to the Republic."¹⁵ It should be noted, however, that "taking" does not only take place upon the issuance of title either in the name of the Republic or the beneficiaries of the Comprehensive Agrarian Reform Program (CARP). "Taking" also occurs when agricultural lands are voluntarily offered by a landowner and approved by PARC for CARP coverage through the stock distribution scheme, as in the instant case. Thus, HLI’s submitting its SDP for approval is an acknowledgment on its part that the agricultural lands of Hacienda Luisita are covered by CARP. However, it was the PARC approval which should be considered as the effective date of "taking" as it was only during this time that the government officially confirmed the CARP coverage of these lands.

Indeed, stock distribution option and compulsory land acquisition are two (2) different modalities under the agrarian reform program. Nonetheless, both share the same end goal, that is, to have "a more equitable distribution and ownership of land, with due regard to the rights of landowners to just compensation."¹⁶

The fact that Sec. 31 of Republic Act No. 6657 (RA 6657) gives corporate landowners the option to give qualified beneficiaries the right to avail of a stock distribution or, in the phraseology of the law, "the right to purchase such proportion of the capital stock of the corporation that the agricultural land, actually devoted to agricultural activities, bears in relation to the company’s total assets," does not detract from the avowed policy of the agrarian reform law of equitably distributing ownership of land. The difference lies in the fact that instead of actually distributing the agricultural lands to the farmer-beneficiaries, these lands are held by the corporation as part of the capital contribution of the farmer-beneficiaries, not of the landowners, under the stock distribution scheme. The end goal of equitably distributing ownership of land is, therefore, undeniable. And since it is only upon the approval of the SDP that the agricultural lands actually came under CARP coverage, such approval operates and takes the place of a notice of coverage ordinarily issued under compulsory acquisition.

Moreover, precisely because due regard is given to the rights of landowners to just compensation, the law on stock distribution option acknowledges that landowners can require payment for the shares of stock corresponding to the value of the agricultural lands in relation to the outstanding capital stock of the corporation.

Although Tadeco did not require compensation for the shares of stock corresponding to the value of the agricultural lands in relation to the outstanding capital stock of HLI, its inability to receive compensation cannot be attributed to the government. The second paragraph of Sec. 31 of RA 6657 explicitly states that "[u]pon certification by DAR, corporations owning agricultural lands may give their qualified beneficiaries the right to purchase such proportion of the capital stock of the corporation that the agricultural land, actually devoted to agricultural activities, bears in relation to the company’s total assets, under such terms and conditions as may be agreed upon by them. x x x"¹⁷ On the basis of this statutory provision, Tadeco could have exacted payment for such shares of stock corresponding to the value of the agricultural lands of Hacienda Luisita in relation to the outstanding capital stock of HLI, but it did not do so.

What is notable, however, is that the divestment by Tadeco of the agricultural lands of Hacienda Luisita and the giving of the shares of stock for free is nothing but an enticement or incentive for the FWBs to agree with the stock distribution option scheme and not further push for land distribution. And the stubborn fact is that the "man days" scheme of HLI impelled the FWBs to work in the hacienda in exchange for such shares of stock.

Notwithstanding the foregoing considerations, the suggestion that there is "taking" only when the landowner is deprived of the use and benefit of his property is not incompatible with Our conclusion that "taking" took place on November 21, 1989. As mentioned in Our July 5, 2011 Decision, even from the start, the stock distribution scheme appeared to be Tadeco’s preferred option in complying with the CARP when it organized HLI as its spin-off corporation in order to facilitate stock acquisition by the FWBs. For this purpose, Tadeco assigned and conveyed to HLI the agricultural lands of Hacienda Luisita, set at 4,915.75 hectares, among others. These agricultural lands constituted as the capital contribution of the FWBs in HLI. In effect, Tadeco deprived itself of the ownership over these lands when it transferred the same to HLI.

While it is true that Tadeco has majority control over HLI, the Court cannot subscribe to the view Mallari, et al. espouse that, on the basis of such majority stockholding, Tadeco was never deprived of the use and benefit of the agricultural lands of Hacienda Luisita it divested itself in favor of HLI.

It bears stressing that "[o]wnership is defined as a relation in law by virtue of which a thing pertaining to one person is completely subjected to his will in everything not prohibited by law or the concurrence with the rights of another."¹⁸ The attributes of ownership are: jus utendi or the right to possess and enjoy, jus fruendi or the right to the fruits, jus abutendi or the right to abuse or consume, jus disponendi or the right to dispose or alienate, and jus vindicandi or the right to recover or vindicate.¹⁹

When the agricultural lands of Hacienda Luisita were transferred by Tadeco to HLI in order to comply with CARP through the stock distribution option scheme, sealed with the imprimatur of PARC under PARC Resolution No. 89-12-2 dated November 21, 1989, Tadeco was consequently dispossessed of the afore-mentioned attributes of ownership. Notably, Tadeco and HLI are two different entities with separate and distinct legal personalities. Ownership by one cannot be considered as ownership by the other.

Corollarily, it is the official act by the government, that is, the PARC’s approval of the SDP, which should be considered as the reckoning point for the "taking" of the agricultural lands of Hacienda Luisita. Although the transfer of ownership over the agricultural lands was made prior to the SDP’s approval, it is this Court’s consistent view that these lands officially became subject of the agrarian reform coverage through the stock distribution scheme only upon the approval of the SDP. And as We have mentioned in Our November 22, 2011 Resolution, such approval is akin to a notice of coverage ordinarily issued under compulsory acquisition.

Further, if We adhere to HLI’s view that the Notice of Coverage issued on January 2, 2006 should, at the very least, be considered as the date of "taking" as this was the only time that the agricultural portion of the hacienda was placed under compulsory acquisition in view of HLI’s failure to perform certain obligations under the SDP, this Court would, in effect, be penalizing the qualified FWBs twice for acceding to the adoption of the stock distribution scheme: first, by depriving the qualified FWBs of the agricultural lands that they should have gotten early on were it not for the adoption of the stock distribution scheme of which they only became minority stockholders; and second, by making them pay higher amortizations for the agricultural lands that should have been given to them decades ago at a much lower cost were it not for the landowner’s initiative of adopting the stock distribution scheme "for free."

Reiterating what We already mentioned in Our November 22, 2011 Resolution, "[e]ven if it is the government which will pay the just compensation to HLI, this will also affect the FWBs as they will be paying higher amortizations to the government if the ‘taking’ will be considered to have taken place only on January 2, 2006." As aptly observed by Justice Leonardo-De Castro in her Concurring Opinion, "this will put the land beyond the capacity of the [FWBs] to pay," which this Court should not countenance.

Considering the above findings, it cannot be gainsaid that effective "taking" took place in the case at bar upon the approval of the SDP, that is, on November 21, 1989.

HLI postulates that just compensation is a question of fact that should be left to the determination by the DAR, Land Bank of the Philippines (LBP) or even the special agrarian court (SAC).²⁰ As a matter of fact, the Court, in its November 22, 2011 Resolution, dispositively ordered the DAR and the LBP to determine the compensation due to HLI. And as indicated in the body of said Resolution:

The foregoing notwithstanding, it bears stressing that the DAR’s land valuation is only preliminary and is not, by any means, final and conclusive upon the landowner. The landowner can file an original action with the RTC acting as a special agrarian court to determine just compensation. The court has the right to review with finality the determination in the exercise of what is admittedly a judicial function.

As regards the issue on when "taking" occurred with respect to the agricultural lands in question, We, however, maintain that this Court can rule, as it has in fact already ruled on its reckoning date, that is, November 21, 1989, the date of issuance of PARC Resolution No. 89-12-2, based on the above-mentioned disquisitions. The investment on SACs of original and exclusive jurisdiction over all petitions for the determination of just compensation to landowners²¹ will not preclude the Court from ruling upon a matter that may already be resolved based on the records before Us. By analogy, Our ruling in Heirs of Dr. Jose Deleste v. LBP is applicable:

Indeed, it is the Office of the DAR Secretary which is vested with the primary and exclusive jurisdiction over all matters involving the implementation of the agrarian reform program. However, this will not prevent the Court from assuming jurisdiction over the petition considering that the issues raised in it may already be resolved on the basis of the records before Us. Besides, to allow the matter to remain with the Office of the DAR Secretary would only cause unnecessary delay and undue hardship on the parties. Applicable, by analogy, is Our ruling in the recent Bagong Pagkakaisa ng Manggagawa ng Triumph International v. Department of Labor and Employment Secretary, where We held:

But as the CA did, we similarly recognize that undue hardship, to the point of injustice, would result if a remand would be ordered under a situation where we are in the position to resolve the case based on the records before us. As we said in Roman Catholic Archbishop of Manila v. Court of Appeals:

[w]e have laid down the rule that the remand of the case to the lower court for further reception of evidence is not necessary where the Court is in a position to resolve the dispute based on the records before it. On many occasions, the Court, in the public interest and for the expeditious administration of justice, has resolved actions on the merits instead of remanding them to the trial court for further proceedings, such as where the ends of justice, would not be subserved by the remand of the case.²² (Emphasis supplied; citations omitted.)

Even though the compensation due to HLI will still be preliminarily determined by DAR and LBP, subject to review by the RTC acting as a SAC, the fact that the reckoning point of "taking" is already fixed at a certain date should already hasten the proceedings and not further cause undue hardship on the parties, especially the qualified FWBs.

By a vote of 8-6, the Court affirmed its ruling that the date of "taking" in determining just compensation is November 21, 1989 when PARC approved HLI’s stock option plan.

As regards the issue of interest on just compensation, We also leave this matter to the DAR and the LBP, subject to review by the RTC acting as a SAC.

G.R. No. 171101               April 24, 2012
HACIENDA LUISITA, INCORPORATED, Petitioner,
LUISITA INDUSTRIAL PARK CORPORATION and RIZAL COMMERCIAL BANKING CORPORATION, Petitioners-in-Intervention,
vs.
PRESIDENTIAL AGRARIAN REFORM COUNCIL; SECRETARY NASSER PANGANDAMAN OF THE DEPARTMENT OF AGRARIAN REFORM; ALYANSA NG MGA MANGGAGAWANG BUKID NG HACIENDA LUISITA, RENE GALANG, NOEL MALLARI, and JULIO SUNIGA¹ and his SUPERVISORY GROUP OF THE HACIENDA LUISITA, INC. and WINDSOR ANDAYA, Respondents.

In a long line of cases, we have constantly affirmed that:

x x x 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 filing of the complaint.³⁸

When the taking of the property sought to be expropriated coincides with the commencement of the expropriation proceedings, or takes place subsequent to the filing of the complaint for eminent domain, the just compensation should be determined as of the date of the filing of the complaint.³⁹ Even under Sec. 4, Rule 67 of the 1964 Rules of Procedure, under which the complaint for expropriation was filed, just compensation is to be determined "as of the date of the filing of the complaint." Here, there is no reason to depart from the general rule that the point of reference for assessing the value of the Subject Property is the time of the filing of the complaint for expropriation.⁴⁰

Private respondent claims that the reckoning date should be in 2004 because of the "clear injustice to the private respondent who all these years has been deprived of the beneficial use of his properties."

We commiserate with the private respondent. The school was constructed and has been in operation since 1985. Petitioner and the residents of Iloilo City have long reaped the benefits of the property. However, non-payment of just compensation does not entitle the private landowners to recover possession of their expropriated lot.⁴¹

Concededly, Javellana also slept on his rights for over 18 years and did not bother to check with the PNB if a deposit was actually made by the petitioner. Evidently, from his inaction in failing to withdraw or even verify the amounts purportedly deposited, private respondent not only accepted the valuation made by the petitioner, but also was not interested enough to pursue the expropriation case until the end. As such, private respondent may not recover possession of the Subject Property, but is entitled to just compensation.⁴² It is high time that private respondent be paid what was due him after almost 30 years.

We stress, however, that the City of Iloilo should be held liable for damages for taking private respondent’s property without payment of just compensation. In Manila International Airport Authority v. Rodriguez,⁴³ the Court held that a government agency’s prolonged occupation of private property without the benefit of expropriation proceedings undoubtedly entitled the landowner to damages:

Such pecuniary loss entitles him to adequate compensation in the form of actual or compensatory damages, which in this case should be the legal interest (6%) on the value of the land at the time of taking, from said point up to full payment by the MIAA. This is based on the principle that interest "runs as a matter of law and follows from the right of the landowner to be placed in as good position as money can accomplish, as of the date of the taking x x x.

x x x x

For more than twenty (20) years, the MIAA occupied the subject lot without the benefit of expropriation proceedings and without the MIAA exerting efforts to ascertain ownership of the lot and negotiating with any of the owners of the property. To our mind, these are wanton and irresponsible acts which should be suppressed and corrected. Hence, the award of exemplary damages and attorneys fees is in order. x x x.⁴⁴


G.R. No. 168967               February 12, 2010
CITY OF ILOILO represented by HON. JERRY P. TREÑAS, City Mayor, Petitioner,
vs.
HON. LOLITA CONTRERAS-BESANA, Presiding Judge, Regional Trial Court, Branch 32, and ELPIDIO JAVELLANA, Respondents.

no hearing is required for the issuance of the writ of possession

Petitioner has the irrefutable right to exercise its power of eminent domain. It being a local government unit, the basis for its exercise is granted under Section 19 of Rep. Act No. 7160, to wit:

Sec. 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: Provided, however, That the power of eminent domain may not be exercised unless a valid and definite offer has been previously made to the owner, and such offer was not accepted: Provided, further, That the local government unit may immediately take possession of the property upon the filing of the expropriation proceedings and upon making a deposit with the proper court of at least fifteen percent (15%) of the fair market value of the property based on the current tax declaration of the property to be expropriated: Provided, finally, That the amount to be paid for the expropriated property shall be determined by the proper court, based on the fair market value at the time of the taking of the property.

The requisites for authorizing immediate entry are as follows: 

(1) the filing of a complaint for expropriation sufficient in form and substance; and 

(2) the deposit of the amount equivalent to fifteen percent (15%) of the fair market value of the property to be expropriated based on its current tax declaration.³¹ Upon compliance with these requirements, the issuance of a writ of possession becomes ministerial.³²

In the case at bar, petitioner avers that the Amended Complaint it filed complies with both requisites, thus entitling it to a writ of possession as a matter of right and the issuance thereof becoming ministerial on the part of the lower court even without any hearing. On the other hand, private respondents allege that the Amended Complaint is not sufficient in form and substance since it failed to allege compliance with the mandatory requirements for the exercise of the power of eminent domain for purposes of socialized housing.

Section 1 of Rule 67 of the Revised Rules of Civil Procedure reads:

Section 1. The complaint. – The right of eminent domain shall be exercised by the filing of a verified complaint which shall state with certainty the right and purpose of expropriation, describe the real or personal property sought to be expropriated, and join as defendants all persons owning or claiming to own, or occupying, any part hereof or interest therein, showing, so far as practicable, the separate interest of each defendant. If the title to any property sought to be expropriated appears to be in the Republic of the Philippines, although occupied by private individuals, or if the title is otherwise obscure or doubtful so that the plaintiff cannot with accuracy or certainty specify who are the real owners, averment to that effect shall be made in the complaint.

xxx

 

In City of Manila v. Serrano,³⁶ this Court ruled that "hearing is still to be held to determine whether or not petitioner indeed complied with the requirements provided in Rep. Act No. 7279. x x x 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." From the foregoing, it is clear that an evidentiary hearing must be conducted if compliance with the requirements for socialized housing has been made. This hearing, however, is not a hearing to determine if a writ of possession is to be issued, but whether there was compliance with the requirements for socialized housing.

For a writ of possession to issue, only two requirements are required: 

1)the sufficiency in form and substance of the complaint and 

2)the required provisional deposit. 

In fact, no hearing is required for the issuance of a writ of possession. The sufficiency in form and substance of the complaint for expropriation can be determined by the mere examination of the allegations of the complaint. In this case, the sufficiency of the Amended Complaint was further confirmed by public respondent when he set the case for pre-trial and hearing.

G.R. No. 154614             November 25, 2004
THE CITY OF ILOILO, Represented by HON. JERRY P. TREÑAS, City Mayor, petitioner,
vs.
HON. JUDGE EMILIO LEGASPI, Presiding Judge, RTC, Iloilo City, Branch 22, and HEIRS OF MANUELA YUSAY, Represented by SYLVIA YUSAY DEL ROSARIO and ENRIQUE YUSAY, JR., respondents.

the two stages of expropriation

1. There are two (2) stages in every action of expropriation. 

a)The first is concerned with the determination of the authority of the plaintiff to exercise the power of eminent domain and the propriety of its exercise in the context of the facts involved in the suit. ¹⁹ It ends with an order, if not of dismissal of the action, "of condemnation declaring that the plaintiff has a lawful right to take the property sought to be condemned, for the public use or purpose described in the complaint, upon the payment of just compensation to be determined as of the date of the filing of the complaint." ²⁰ An order of dismissal, if this be ordained, would be a final one, of course, since it finally disposes of the action and leaves nothing more to be done by the Court on the Merits. ²¹ So, too, would an order of condemnation be a final one, for thereafter, as the Rules expressly state, in the proceedings before the Trial Court, "no objection to the exercise of the right of condemnation (or the propriety thereof) shall be flied or heard. ²²

b)The second phase of the eminent domain action is concerned with the determination by the Court of "the just compensation for the property sought to be taken." This is done by the Court with the assistance of not more than three (3) commissioners. ²³ The order fixing the just compensation on the basis of the evidence before, and findings of, the commissioners would be final, too. It would finally dispose of the second stage of the suit, and leave nothing more to be done by the Court regarding the issue. Obviously, one or another of the parties may believe the order to be erroneous in its appreciation of the evidence or findings of fact or otherwise. Obviously, too, such a dissatisfied party may seek reversal of the order by taking an appeal therefrom.

expropriation case #1

THIRD DIVISION

G.R. No. 146886             April 30, 2003
DEVORAH E. BARDILLON, petitioner,
vs.
BARANGAY MASILI OF CALAMBA, LAGUNA, respondent.
PANGANIBAN, J.:

An expropriation suit is incapable of pecuniary estimation. Accordingly, it falls within the jurisdiction of regional trial courts, regardless of the value of the subject property.

The Case

Before us is a Petition for Review¹ under Rule 45 of the Rules of Court, seeking to set aside the January 10, 2001 Decision and the February 5, 2001 Resolution of the Court of Appeals² (CA) in CA-GR SP No. 61088. The dispositive part of the Decision reads:

"WHEREFORE, premises considered, the present [P]etition for [C]ertiorari is hereby DENIED DUE COURSE and accordingly DISMISSED, for lack of merit."³

The assailed Resolution⁴ denied petitioner's Motion for Reconsideration.

The Facts

The factual antecedents are summarized by the CA as follows:

"At the root of this present [P]etition is the controversy surrounding the two (2) [C]omplaints for eminent domain which were filed by herein respondent for the purpose of expropriating a ONE HUNDRED FORTY FOUR (144) square meter-parcel of land, otherwise known as Lot 4381-D situated in Barangay Masili, Calamba, Laguna and owned by herein petitioner under Transfer Certificate of Title No. 383605 of the Registry of Deeds of Calamba, Laguna. Petitioner acquired from Makiling Consolidated Credit Corporation the said lot pursuant to a Deed of Absolute Sale which was executed by and between the former and the latter on October 7, 1996.

"The first [C]omplaint for eminent domain, docketed as Civil Case No. 3648 and entitled 'Brgy. Masili, Calamba, Laguna v. Emelita A. Reblara, Eugenia Almazan & Devorah E. Bardillon,' was filed before the Municipal Trial Court of Calamba, Laguna ('MTC') on February 23, 1998, following the failure of Barangay Masili to reach an agreement with herein petitioner on the purchase offer of TWO HUNDRED THOUSAND PESOS (P200,000.00). The expropriation of Lot 4381-D was being pursued in view of providing Barangay Masili a multi-purpose hall for the use and benefit of its constituents.

"On March 5, 1999, the MTC issued an order dismissing Civil Case No. 3648 'for lack of interest' for failure of the [respondent] and its counsel to appear at the pre-trial. The MTC, in its Order dated May 3, 1999, denied [respondent's] [M]otion for [R]econsideration thereof.

"The second [C]omplaint for eminent domain, docketed as Civil Case No. 2845-99-C and entitled 'Brgy. Masili, Calamba, Laguna v. Devorah E. Bardillon' was filed before Branch 37 of the Regional Trial Court of Calamba, Laguna ('RTC') on October 18, 1999. This [C]omplaint also sought the expropriation of the said Lot 4381-D for the erection of a multi-purpose hall of Barangay Masili, but petitioner, by way of a Motion to Dismiss, opposed this [C]omplaint by alleging in the main that it violated Section 19(f) of Rule 16 in that [respondent's] cause of action is barred by prior judgment, pursuant to the doctrine of res judicata.

"On January 21, 2000, [the] Judge issued an order denying petitioner's Motion to Dismiss, holding that the MTC which ordered the dismissal of Civil Case No. 3648 has no jurisdiction over the said expropriation proceeding.

"With the subsequent approval of Municipal Ordinance No. 2000-261 on July 10, 2000, and the submission thereof in compliance with [the] Judge's Order dated June 9, 2000 requiring herein respondent to produce the authority for the expropriation through the Municipal Council of Calamba, Laguna, the assailed Order dated August 4, 2000 was issued in favor of Barangay Masili x x x and, on August 16, 2000, the corresponding order for the issuance of the [W]rit of [P]ossession over Lot 4381-D."⁵

Ruling of the Court of Appeals

In dismissing the Petition, the CA held that the Regional Trial Court (RTC) of Calamba, Laguna (Branch 37)⁶ did not commit grave abuse of discretion in issuing the assailed Orders. It ruled that the second Complaint for eminent domain (Civil Case No. 2845-99-C) was not barred by res judicata. The reason is that the Municipal Trial Court (MTC), which dismissed the first Complaint for eminent domain (Civil Case No. 3648), had no jurisdiction over the action.

Hence, this Petition.⁷

The Issues

In her Memorandum, petitioner raises the following issues for our consideration:

"A. Whether or not, the Honorable Respondent Court committed grave abuse of discretion amounting to lack of jurisdiction when it denied and dismissed petitioner's appeal;

"B. Whether or not, the Honorable Respondent Court committed grave abuse of discretion when it did not pass upon and consider the pending Motion for Reconsideration which was not resolved by the Regional Trial Court before issuing the questioned Orders of 4 and 16 August 2000;

"C. Whether or not, the Honorable Respondent Court committed grave abuse of discretion in taking the total amount of the assessed value of the land and building to confer jurisdiction to the court a quo;

"D. Whether or not, the Honorable Respondent Court committed grave abuse of discretion in ignoring the fact that there is an existing multi-purpose hall erected in the land owned by Eugenia Almazan which should be subject of expropriation; and

"E. Whether or not, the Honorable Respondent Court committed grave abuse of discretion in failing to consider the issue of forum shopping committed by Respondent Masili."⁸

Simply put, the issues are as follows: (1) whether the MTC had jurisdiction over the expropriation case; (2) whether the dismissal of that case before the MTC constituted res judicata; (3) whether the CA erred when it ignored the issue of entry upon the premises; and (4) whether respondent is guilty of forum shopping.

The Court's Ruling

The Petition has no merit.

First Issue:
Jurisdiction Over Expropriation

WHAT COURT HAS JURISDICTION IN EXPROPRIATION PROCEEDINGS? Is the amount of the value of the property relevant in the determination of jurisdiction?

Petitioner claims that, since the value of the land is only P11,448, the MTC had jurisdiction over the case.⁹

On the other hand, the appellate court held that the assessed value of the property was P28,960.¹⁰ Thus, the MTC did not have jurisdiction over the expropriation proceedings, because the amount involved was beyond the P20,000 jurisdictional amount cognizable by MTCs.

An expropriation suit does not involve the recovery of a sum of money. Rather, it deals with the exercise by the government of its authority and right to take property for public use.¹¹ As such, it is incapable of pecuniary estimation and should be filed with the regional trial courts.¹²

This was explained by the Court in Barangay San Roque v. Heirs of Francisco Pastor:¹³

"It should be stressed that the primary consideration in an expropriation suit is whether the government or any of its instrumentalities has complied with the requisites for the taking of private property. Hence, the courts determine the authority of the government entity, the necessity of the expropriation, and the observance of due process. In the main, the subject of an expropriation suit is the government's exercise of eminent domain, a matter that is incapable of pecuniary estimation.

"True, the value of the property to be expropriated is estimated in monetary terms, for the court is duty-bound to determine the just compensation for it. This, however, is merely incidental to the expropriation suit. Indeed, that amount is determined only after the court is satisfied with the propriety of the expropriation."

"Verily, the Court held in Republic of the Philippines v. Zurbano that 'condemnation proceedings are within the jurisdiction of Courts of First Instance,' the forerunners of the regional trial courts. The said case was decided during the effectivity of the Judiciary Act of 1948 which, like BP 129 in respect to RTCs, provided that courts of first instance had original jurisdiction over 'all civil actions in which the subject of the litigation is not capable of pecuniary estimation.' The 1997 amendments to the Rules of Court were not intended to change these jurisprudential precedents.¹⁴

To reiterate, an expropriation suit is within the jurisdiction of the RTC regardless of the value of the land, because the subject of the action is the government's exercise of eminent domain — a matter that is incapable of pecuniary estimation.

Second Issue:
Res Judicata

Petitioner claims that the MTC's dismissal of the first Complaint for eminent domain was with prejudice, since there was no indication to the contrary in the Order of dismissal. She contends that the filing of the second Complaint before the RTC should therefore be dismissed on account of res judicata.

Res judicata literally means a matter adjudged, judicially acted upon or decided, or settled by judgment.¹⁵ It provides that a final judgment on the merits rendered by a court of competent jurisdiction is conclusive as to the rights of the parties and their privies; and constitutes an absolute bar to subsequent actions involving the same claim, demand or cause of action.¹⁶

The following are the requisites of res judicata: (1) the former judgment must be final; (2) the court that rendered it had jurisdiction over the subject matter and the parties; (3) it is a judgment on the merits; and (4) there is — between the first and the second actions — an identity of parties, subject matter and cause of action.¹⁷

Since the MTC had no jurisdiction over expropriation proceedings, the doctrine of res judicata finds no application even if the Order of dismissal may have been an adjudication on the merits.

Third Issue:
Legality of Entry Into Premises

Petitioner argues that the CA erred when it ignored the RTC's Writ of Possession over her property, issued despite the pending Motion for Reconsideration of the ruling dismissing the Complaint. We are not persuaded.

The requirements for the issuance of a writ of possession in an expropriation case are expressly and specifically governed by Section 2 of Rule 67 of the 1997 Rules of Civil Procedure.¹⁸ On the part of local government units, expropriation is also governed by Section 19 of the Local Government Code.¹⁹ Accordingly, in expropriation proceedings, the requisites for authorizing immediate entry are as follows:

 (1) the filing of a complaint for expropriation sufficient in form and substance; and

 (2) the deposit of the amount equivalent to 15 percent of the fair market value of the property to be expropriated based on its current tax declaration.²⁰

In the instant case, the issuance of the Writ of Possession in favor of respondent after it had filed the Complaint for expropriation and deposited the amount required was proper, because it had complied with the foregoing requisites.

The issue of the necessity of the expropriation is a matter properly addressed to the RTC in the course of the expropriation proceedings. If petitioner objects to the necessity of the takeover of her property, she should say so in her Answer to the Complaint.²¹ The RTC has the power to inquire into the legality of the exercise of the right of eminent domain and to determine whether there is a genuine necessity for it.²²

Fourth Issue:
Forum Shopping

Petitioner claims that respondent is guilty of forum shopping, because it scouted for another forum after obtaining an unfavorable Decision from the MTC.

The test for determining the presence of forum shopping is whether the elements of litis pendentia are present in two or more pending cases, such that a final judgment in one case will amount to res judicata in another.²³

Be it noted that the earlier case lodged with the MTC had already been dismissed when the Complaint was filed before the RTC. Even granting arguendo that both cases were still pending, a final judgment in the MTC case will not constitute res judicata in the RTC, since the former had no jurisdiction over the expropriation case.

WHEREFORE, the Petition is DENIED and the assailed Decision AFFIRMED. Costs against petitioner.

SO ORDERED.

Puno, Sandoval-Gutierrez, Corona and Carpio Morales, JJ ., concur.

Footnotes

¹ Rollo, pp. 10–34.

² Fourteenth Division. Written by Justice Martin S. Villarama Jr.; concurred in by Justice Conrado M. Vasquez Jr. (Division chairman) and Justice Perlita J. Tria-Tirona (acting member).

³ Assailed CA Decision, p. 5; rollo, p. 142.

⁴ Rollo, p. 151.

⁵ Assailed CA Decision, pp. 2–3; rollo, pp. 139–140. Citations omitted. Emphasis in the original.

⁶ Presided by Judge Juanita T. Guerrero.

⁷ This case was deemed submitted for decision on December 6, 2001, upon the Court's receipt of petitioner's Memorandum signed by Atty. Rufino C. Lizardo of Lizardo Carlos & Associates. Respondent's Memorandum, signed by Atty. Reynaldo V. Improgo, was received by the Court on November 29, 2001.

⁸ Petitioner's Memorandum, pp. 8–9; rollo, pp. 428–429. Original in upper case.

⁹ Annex "A-1" — Tax Declaration No. 032-00318 issued by the Municipal Assessor of Calamba, Laguna; rollo, p. 346.

¹⁰ Assailed CA Decision, p. 4; rollo, p. 410.

¹¹ Barangay San Roque, Talisay, Cebu v. Heirs of Francisco Pastor, 334 SCRA 127, June 20, 2000; Republic v. La Orden de PP. Benedictos de Filipinas, 111 Phil. 230, February 28, 1961.

¹² §19 (1) of BP 129, as amended by RA 7691.

¹³ Supra.

¹⁴ Id., p. 134, per Panganiban, J. Emphasis in original.

¹⁵ Mirpuri v. Court of Appeals, 318 SCRA 116, November 19, 1999; citing 46 Am Jur 2d, "Judgments" Sec. 394 (1969 ed.).

¹⁶ Republic of the Philippines v. Court of Appeals, 324 SCRA 560, February 3, 2000; Firestone Ceramics, Inc. v. Court of Appeals, 313 SCRA 522, September 2, 1999; Lee Bun Ting v. Aligaen, 76 SCRA 416, April 22, 1977; Philippine National Bank v. Barretto, 52 Phil. 818, February 21, 1929.

¹⁷ Quezon Province v. Marte, 368 SCRA 145, October 23, 2001; Avisado v. Rumbaua, 354 SCRA 245, March 12, 2001; Vda. de Salanga v. Alagar, 335 SCRA 728, July 14, 2000; Siapian v. Court of Appeals, 327 SCRA 11, March 1, 2000; Ocampo v. Buenaventura, 154 Phil. 253, January 24, 1974.

¹⁸ "SECTION 2. Entry of plaintiff upon depositing value with authorized government depositary. — 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. . . .

xxx           xxx           xxx

"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."

¹⁹ "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 benefits of the poor and the landless, upon payment of just compensation, pursuant to the provisions of the Constitution and pertinent laws; Provided, however, That the power of eminent domain may not be exercised unless a valid and definite offer has been previously made to the owner, and such offer was not accepted: Provided, further, That the local government unit may immediately take possession of the property upon the filing of the expropriation proceedings and upon making a deposit with the proper court of at least fifteen percent (15%) of the fair market value of the property based on the current tax declaration of the property to be expropriated: Provided, finally, That the amount to be paid for the expropriated property shall be determined by the proper court, based on the fair market value at the time of the taking of the property."

²⁰ Biglang-awa v. Bacalla, 345 SCRA 562, November 22, 2000.

²¹ §3 of Rule 67 of the Rules of Court.

²² Moday v. Court of Appeals, 335 Phil. 1057, February 20, 1997; Republic of the Philippines v. La Orden de PP. Benedictinos de Filipinas, supra; City of Manila v. Chinese Community, 40 Phil. 349, October 31, 1919.

²³ Heirs of Victorina Motus Peñaverde v. Heirs of Mariano Peñaverde, 344 SCRA 69, October 20, 2000; Ong v. Court of Appeals, 333 SCRA 189, June 8, 2000; Philippine Woman's Christian Temperance Union, Inc. v. Abiertas House of Friendship, Inc., 354 Phil. 791, July 22, 1998; Buan v. Lopez Jr., 229 Phil. 65, October 13, 1986.

lis mota

The last but the most important requisite that the constitutional issue must be the very lis mota of the case does not likewise obtain. The lis mota aspect is not present, the constitutional issue tendered not being critical to the resolution of the case. The unyielding rule has been to avoid, whenever plausible, an issue assailing the constitutionality of a statute or governmental act.[110]  If some other grounds exist by which judgment can be made without touching the constitutionality of a law, such recourse is favored.[111]  Garcia v. Executive Secretary explains why:

Lis Mota — the fourth requirement to satisfy before this Court will undertake judicial review — means that the Court will not pass upon a question of unconstitutionality, although properly presented, if the case can be disposed of on some other ground, such as the application of the statute or the general law. The petitioner must be able to show that the case cannot be legally resolved unless the constitutional question raised is determined. This requirement is based on the rule that every law has in its favor the presumption of constitutionality; to justify its nullification, there must be a clear and unequivocal breach of the Constitution, and not one that is doubtful, speculative, or argumentative.[112] (Italics in the original.)

The lis mota in this case, proceeding from the basic positions originally taken by AMBALA (to which the FARM members previously belonged) and the Supervisory Group, is the alleged non-compliance by HLI with the conditions of the SDP to support a plea for its revocation. And before the Court, the lis mota is whether or not PARC acted in grave abuse of discretion when it ordered the recall of the SDP for such non-compliance and the fact that the SDP, as couched and implemented, offends certain constitutional and statutory provisions. To be sure, any of these key issues may be resolved without plunging into the constitutionality of Sec. 31 of RA 6657. Moreover, looking deeply into the underlying petitions of AMBALA, et al., it is not the said section per se that is invalid, but rather it is the alleged application of the said provision in the SDP that is flawed. 

HACIENDA LUISITA, INCORPORATED,   -  versus  -PRESIDENTIAL AGRARIAN REFORM COUNCIL; SECRETARY NASSER PANGANDAMAN OF THE DEPARTMENT OF AGRARIAN REFORM(2011)

FRANCISCO V. HOUSE OF REPRESENTATIVES

 WHAT IS THE NATURE OF IMPEACHMENT?

First.  The matter of impeachment is a political question that must rightfully be addressed to a political branch of government, which is the Congress of the Philippines.  As enunciated in Integrated Bar of the Philippines v. Zamora,_[3] we do not automatically assume jurisdiction over actual constitutional cases brought before us even in instances that are ripe for resolution -

One class of cases wherein the Court hesitates to rule on are “political questions.” The reason is that political questions are concerned with issues dependent upon the wisdom, not the legality, of a particular act or measure being assailed.  Moreover, the political question being the function of the separation of powers, the courts will not normally interfere with the workings of another co-equal branch unless the case shows a clear need for the courts to step in to uphold the law and the Constitution.

Clearly, the constitutional power of impeachment rightfully belongs to Congress in a two-fold character:  (a) The power to initiate impeachment cases against impeachable officers is lodged in the House of Representatives; and, (b) The power to try and decide impeachment cases belongs solely to the Senate.

In Baker v. Carr_[4] repeatedly mentioned during the oral arguments, the United States Supreme Court held that political questions chiefly relate to separation of powers issues, the Judiciary being a co-equal branch of government together with the Legislature and the Executive branch, thus calling for judicial deference.  A controversy is non-justiciable where there is a “textually demonstrable constitutional commitment of the issue to a coordinate political department, or a lack of judicially discoverable and manageable standards for resolving it._"

_{WHAT IS THE "POLITICAL QUESTION"DOCTRINE IN IMPEACHMENT CASES?}

But perhaps it is Nixon v. United States_[6] which provides the authority on the “political question” doctrine as applied in impeachment cases.  In that case the U.S. Supreme Court applied the Baker ruling to reinforce the “political question” doctrine in impeachment cases.  Unless it can therefore be shown that the exercise of such discretion was gravely abused, the Congressional exercise of judgment must be recognized by this Court.  The burden to show that the House or the Senate gravely abused its discretion in impeaching a public officer belongs exclusively to the impeachable officer concerned.

Second.  At all times, the three (3) departments of government must accord mutual respect to each other under the principle of separation of powers.  As a co-equal, coordinate and co-extensive branch, the Judiciary must defer to the wisdom of the Congress in the exercise of the latter’s power under the Impeachment Clause of the Constitution as a measure of judicial comity on issues properly within the sphere of the Legislature.

Third.  It is incumbent upon the Court to exercise judicial restraint in rendering a ruling in this particular case to preserve the principle of separation of powers and restore faith and stability in our system of government.  Dred Scott v. Sandford_[7] is a grim illustration of how catastrophic improvident judicial incursions into the legislative domain could be.  It is one of the most denounced cases in the history of U.S. Supreme Court decision-making.  Penned by Chief Justice Taney, the U.S. Supreme Court, by a vote of 7-2, denied that a Negro was a citizen of the United States even though he happened to live in a “free” state.  The U.S. High Court likewise declared unconstitutional the law forbidding slavery in certain federal territories.   Dred Scott undermined the integrity of the U.S. High Court at a moment in history when it should have been a powerful stabilizing force.  More significantly, it inflamed the passions of the Northern and Southern states over the slavery issue thus precipitating the American Civil War.  This we do not wish to happen in the Philippines!

It must be clarified, lest I be misconstrued, this is not to say that this Court is absolutely precluded from inquiring into the constitutionality of the impeachment process.  The present Constitution, specifically under Art. VIII, Sec. 1, introduced the expanded concept of the power of judicial review that now explicitly allows the determination of whether there has been a grave abuse of discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the government.   This is evidently in response to the unedifying experience of the past in frequently resorting to the “political question” doctrine that in no mean measure has emasculated the Court’s authority to strike down abuses of power by the government or any of its instrumentalities.

CAN THERE BE JUDICIAL INTERFERENCE IN AN IMPEACHMENT PROCEEDINGS?

 

While the impeachment mechanism is by constitutional design a sui generis political process, it is not impervious to judicial interference in case of arbitrary or capricious exercise of the power to impeach by Congress.  It becomes the duty of the Court to step in, not for the purpose of questioning the wisdom or motive behind the legislative exercise of impeachment powers, but merely to check against infringement of constitutional standards.  In such circumstance, legislative actions “might be so far beyond the scope of its constitutional authority, and the consequent impact on the Republic so great, as to merit a judicial response despite prudential concerns that would ordinarily counsel silence.”_[8] I must, of course, hasten to add by way of a finale the nature of the power of judicial review as elucidated in Angara v. Electoral Commission_[9] –

WHAT IS A CONSTITUTION? WHAT IS JUDICIAL SUPREMACY?

The Constitution is a definition of the powers of government. Who is to determine the nature, scope and extent of such powers? The Constitution itself has provided for the instrumentality of the judiciary as the rational way. And when the judiciary mediates to allocate constitutional boundaries, it does not assert any superiority over the other departments; it does not in reality nullify or invalidate an act of the legislature, but only asserts the solemn and sacred obligation assigned to it by the Constitution to determine conflicting claims of authority under the Constitution and to establish for the parties in an actual controversy the rights which that instrument secures and guarantees to them. This is in truth all that is involved in what is termed “judicial supremacy” which properly is the power of judicial review under the Constitution (underscoring supplied).