Republic of the Philippines SUPREME COURT Manila THIRD DIVISION G.R. No. 168557 FELS ENERGY, NC.

, Petitioner, vs. T!E PRO" NCE OF #$T$NG$S a%& T!E OFF CE OF T!E PRO" NC $L $SSESSOR OF #$T$NG$S, Respondents. !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! G.R. No. 170628 February 16, 2007 February 16, 2007

N$T ON$L PO'ER CORPOR$T ON, Petitioner, vs. LOC$L #O$R( OF $SSESSMENT $PPE$LS OF #$T$NG$S, L$URO C. $N($Y$, )% *)+ ,a-a,).y a+ .*e $++e++or o/ .*e Pro0)%,e o/ #a.a%1a+, a%& .*e PRO" NCE OF #$T$NG$S re-re+e%.e& by ).+ Pro0)%,)a2 $++e++or, Respondents. D"#ISION C$LLE3O, SR., J.: $efore us are t%o consolidated cases doc&eted as '.R. No. ()*++, and '.R. No. (,-).*, %hich %ere filed b/ petitioners 0"1S "ner2/, Inc. 30"1S4 and National Po%er #orporation 3NP#4, respectivel/. The first is a petition for revie% on certiorari assailin2 the 5u2ust .+, .--6 Decision of the #ourt of 5ppeals 3#54 in #5!'.R. SP No. ),67- and its Resolution dated 8une .-, .--+9 the second, also a petition for revie% on certiorari, challen2es the 0ebruar/ 7, .--+ Decision and Nove:ber .;, .--+ Resolution of the #5 in #5!'.R. SP No. ),67(. $oth petitions %ere dis:issed on the 2round of prescription. The pertinent facts are as follo%s< On 8anuar/ (*, (77;, NP# entered into a lease contract %ith Polar "ner2/, Inc. over ; ;- M= diesel en2ine po%er bar2es :oored at $ala/an $a/ in #alaca, $atan2as. The contract, deno:inated as an "ner2/ #onversion 52ree:ent 352ree:ent4, %as for a period of five /ears. 5rticle (- reads< (-.( R"SPONSI$I1IT>. N5PO#OR shall be responsible for the pa/:ent of 3a4 all ta es, i:port duties, fees, char2es and other levies i:posed b/ the National 'overn:ent of the Republic of the Philippines or an/ a2enc/ or instru:entalit/ thereof to %hich PO15R :a/ be or beco:e sub?ect to or in relation to the perfor:ance of their obli2ations under this a2ree:ent 3other than 3i4 ta es i:posed or calculated on the basis of the net inco:e of PO15R and Personal Inco:e Ta es of its e:plo/ees and 3ii4 construction per:it fees, environ:ental per:it fees and other si:ilar fees and char2es4 and 3b4 all real estate ta es and assess:ents, rates and other char2es in respect of the Po%er $ar2es.

Subse@uentl/, Polar "ner2/, Inc. assi2ned its ri2hts under the 52ree:ent to 0"1S. The NP# initiall/ opposed the assi2n:ent of ri2hts, citin2 para2raph (,.. of 5rticle (, of the 52ree:ent. On 5u2ust ,, (77+, 0"1S received an assess:ent of real propert/ ta es on the po%er bar2es fro: Provincial 5ssessor 1auro #. 5nda/a of $atan2as #it/. The assessed ta , %hich li&e%ise covered those due for (776, a:ounted to P+),(*6,-**.6- per annu:. 0"1S referred the :atter to NP#, re:indin2 it of its obli2ation under the 52ree:ent to pa/ all real estate ta es. It then 2ave NP# the full po%er and authorit/ to represent it in an/ conference re2ardin2 the real propert/ assess:ent of the Provincial 5ssessor. In a letter dated Septe:ber ,, (77+, NP# sou2ht reconsideration of the Provincial 5ssessorAs decision to assess real propert/ ta es on the po%er bar2es. Ho%ever, the :otion %as denied on Septe:ber .., (77+, and the Provincial 5ssessor advised NP# to pa/ the assess:ent. This pro:pted NP# to file a petition %ith the 1ocal $oard of 5ssess:ent 5ppeals 31$554 for the settin2 aside of the assess:ent and the declaration of the bar2es as non!ta able ite:s9 it also pra/ed that should 1$55 find the bar2es to be ta able, the Provincial 5ssessor be directed to :a&e the necessar/ corrections. In its 5ns%er to the petition, the Provincial 5ssessor averred that the bar2es %ere real propert/ for purposes of ta ation under Section (773c4 of Republic 5ct 3R.5.4 No. ,()-. $efore the case %as decided b/ the 1$55, NP# filed a Manifestation, infor:in2 the 1$55 that the Depart:ent of 0inance 3DO04 had rendered an opinion dated Ma/ .-, (77), %here it is clearl/ stated that po%er bar2es are not real propert/ sub?ect to real propert/ assess:ent. On 5u2ust .), (77), the 1$55 rendered a Resolution den/in2 the petition. The fallo reads< =H"R"0OR", the Petition is D"NI"D. 0"1S is hereb/ ordered to pa/ the real estate ta in the a:ount of P+),(*6,-**.6-, for the /ear (776. SO ORD"R"D. The 1$55 ruled that the po%er plant facilities, %hile the/ :a/ be classified as :ovable or personal propert/, are nevertheless considered real propert/ for ta ation purposes because the/ are installed at a specific location %ith a character of per:anenc/. The 1$55 also pointed out that the o%ner of the bar2esB0"1S, a private corporationBis the one bein2 ta ed, not NP#. 5 :ere a2ree:ent :a&in2 NP# responsible for the pa/:ent of all real estate ta es and assess:ents %ill not ?ustif/ the e e:ption of 0"1S9 such a privile2e can onl/ be 2ranted to NP# and cannot be e tended to 0"1S. 0inall/, the 1$55 also ruled that the petition %as filed out of ti:e. 522rieved, 0"1S appealed the 1$55As rulin2 to the #entral $oard of 5ssess:ent 5ppeals 3#$554. On 5u2ust .*, (77), the Provincial Treasurer of $atan2as #it/ issued a Notice of 1ev/ and =arrant b/ Distraint over the po%er bar2es, see&in2 to collect real propert/ ta es a:ountin2 to P.;.,)-.,(.+.7( as of 8ul/ ;(, (77). The notice and %arrant %as officiall/ served to 0"1S on Nove:ber *, (77). It then filed a Motion to 1ift 1ev/ dated Nove:ber (6, (77), pra/in2 that the Provincial 5ssessor be further restrained b/ the #$55 fro: enforcin2 the disputed assess:ent durin2 the pendenc/ of the appeal.

On Nove:ber (+, (77), the #$55 issued an Order liftin2 the lev/ and distraint on the properties of 0"1S in order not to pree:pt and render ineffectual, nu2ator/ and illusor/ an/ resolution or ?ud2:ent %hich the $oard %ould issue. Meanti:e, the NP# filed a Motion for Intervention dated 5u2ust ,, (77* in the proceedin2s before the #$55. This %as approved b/ the #$55 in an Order dated Septe:ber .., (77*. Durin2 the pendenc/ of the case, both 0"1S and NP# filed several :otions to ad:it bond to 2uarantee the pa/:ent of real propert/ ta es assessed b/ the Provincial 5ssessor 3in the event that the ?ud2:ent be unfavorable to the:4. The bonds %ere dul/ approved b/ the #$55. On 5pril ), .---, the #$55 rendered a Decision findin2 the po%er bar2es e e:pt fro: real propert/ ta . The dispositive portion reads< =H"R"0OR", the Resolution of the 1ocal $oard of 5ssess:ent 5ppeals of the Province of $atan2as is hereb/ reversed. Respondent!appellee Provincial 5ssessor of the Province of $atan2as is hereb/ ordered to drop sub?ect propert/ under 5RPCTa Declaration No. -(*!--7+* fro: the 1ist of Ta able Properties in the 5ssess:ent Roll. The Provincial Treasurer of $atan2as is hereb/ directed to act accordin2l/. SO ORD"R"D. Rulin2 in favor of 0"1S and NP#, the #$55 reasoned that the po%er bar2es belon2 to NP#9 since the/ are actuall/, directl/ and e clusivel/ used b/ it, the po%er bar2es are covered b/ the e e:ptions under Section .;63c4 of R.5. No. ,()-. 5s to the other ?urisdictional issue, the #$55 ruled that prescription did not preclude the NP# fro: pursuin2 its clai: for ta e e:ption in accordance %ith Section .-) of R.5. No. ,()-. The Provincial 5ssessor filed a :otion for reconsideration, %hich %as opposed b/ 0"1S and NP#. In a co:plete volte face, the #$55 issued a Resolution on 8ul/ ;(, .--( reversin2 its earlier decision. The fallo of the resolution reads< =H"R"0OR", pre:ises considered, it is the resolution of this $oard that< 3a4 The decision of the $oard dated ) 5pril .--- is hereb/ reversed. 3b4 The petition of 0"1S, as %ell as the intervention of NP#, is dis:issed. 3c4 The resolution of the 1ocal $oard of 5ssess:ent 5ppeals of $atan2as is hereb/ affir:ed, 3d4 The real propert/ ta assess:ent on 0"1S b/ the Provincial 5ssessor of $atan2as is li&e%ise hereb/ affir:ed. SO ORD"R"D. 0"1S and NP# filed separate :otions for reconsideration, %hich %ere ti:el/ opposed b/ the Provincial 5ssessor. The #$55 denied the said :otions in a Resolution dated October (7, .--(. Dissatisfied, 0"1S filed a petition for revie% before the #5 doc&eted as #5!'.R. SP No. ),67-. Mean%hile, NP# filed a separate petition, doc&eted as #5!'.R. SP No. ),67(.

On 8anuar/ (,, .--., NP# filed a ManifestationCMotion for #onsolidation in #5!'.R. SP No. ),67- pra/in2 for the consolidation of its petition %ith #5!'.R. SP No. ),67(. In a Resolution dated 0ebruar/ (., .--., the appellate court directed NP# to re!file its :otion for consolidation %ith #5!'.R. SP No. ),67(, since it is the ponente of the latter petition %ho should resolve the re@uest for reconsideration. NP# failed to co:pl/ %ith the aforesaid resolution. On 5u2ust .+, .--6, the T%elfth Division of the appellate court rendered ?ud2:ent in #5!'.R. SP No. ),67- den/in2 the petition on the 2round of prescription. The decretal portion of the decision reads< =H"R"0OR", the petition for revie% is D"NI"D for lac& of :erit and the assailed Resolutions dated 8ul/ ;(, .--( and October (7, .--( of the #entral $oard of 5ssess:ent 5ppeals are 500IRM"D. SO ORD"R"D. On Septe:ber .-, .--6, 0"1S ti:el/ filed a :otion for reconsideration see&in2 the reversal of the appellate courtAs decision in #5!'.R. SP No. ),67-. Thereafter, NP# filed a petition for revie% dated October (7, .--6 before this #ourt, doc&eted as '.R. No. ()+((;, assailin2 the appellate courtAs decision in #5!'.R. SP No. ),67-. The petition %as, ho%ever, denied in this #ourtAs Resolution of Nove:ber *, .--6, for NP#As failure to sufficientl/ sho% that the #5 co::itted an/ reversible error in the challen2ed decision. NP# filed a :otion for reconsideration, %hich the #ourt denied %ith finalit/ in a Resolution dated 8anuar/ (7, .--+. Meanti:e, the appellate court dis:issed the petition in #5!'.R. SP No. ),67(. It held that the ri2ht to @uestion the assess:ent of the Provincial 5ssessor had alread/ prescribed upon the failure of 0"1S to appeal the disputed assess:ent to the 1$55 %ithin the period prescribed b/ la%. Since 0"1S had lost the ri2ht to @uestion the assess:ent, the ri2ht of the Provincial 'overn:ent to collect the ta %as alread/ absolute. NP# filed a :otion for reconsideration dated March *, .--+, see&in2 reconsideration of the 0ebruar/ +, .--+ rulin2 of the #5 in #5!'.R. SP No. ),67(. The :otion %as denied in a Resolution dated Nove:ber .;, .--+. The :otion for reconsideration filed b/ 0"1S in #5!'.R. SP No. ),67- had been earlier denied for lac& of :erit in a Resolution dated 8une .-, .--+. On 5u2ust ;, .--+, 0"1S filed the petition doc&eted as '.R. No. ()*++, before this #ourt, raisin2 the follo%in2 issues< 5. =hether po%er bar2es, %hich are floatin2 and :ovable, are personal properties and therefore, not sub?ect to real propert/ ta . $. 5ssu:in2 that the sub?ect po%er bar2es are real properties, %hether the/ are e e:pt fro: real estate ta under Section .;6 of the 1ocal 'overn:ent #ode 3D1'#D4. #.

5ssu:in2 ar2uendo that the sub?ect po%er bar2es are sub?ect to real estate ta , %hether or not it should be NP# %hich should be :ade to pa/ the sa:e under the la%. D. 5ssu:in2 ar2uendo that the sub?ect po%er bar2es are real properties, %hether or not the sa:e is sub?ect to depreciation ?ust li&e an/ other personal properties. ". =hether the ri2ht of the petitioner to @uestion the patentl/ null and void real propert/ ta assess:ent on the petitionerAs personal properties is i:prescriptible. On 8anuar/ (;, .--), NP# filed its o%n petition for revie% before this #ourt 3'.R. No. (,-).*4, indicatin2 the follo%in2 errors co::itted b/ the #5< I TH" #OERT O0 5PP"51S 'R5V"1> "RR"D IN HO1DIN' TH5T TH" 5PP"51 TO TH" 1$55 =5S 0I1"D OET O0 TIM". II TH" #OERT O0 5PP"51S 'R5V"1> "RR"D IN NOT HO1DIN' TH5T TH" PO="R $5R'"S 5R" NOT SE$8"#T TO R"51 PROP"RT> T5F"S. III TH" #OERT O0 5PP"51S 'R5V"1> "RR"D IN NOT HO1DIN' TH5T TH" 5SS"SSM"NT ON TH" PO="R $5R'"S =5S NOT M5D" IN 5##ORD5N#" =ITH 15=. #onsiderin2 that the factual antecedents of both cases are si:ilar, the #ourt ordered the consolidation of the t%o cases in a Resolution dated March *, .--). 1awphi1.net In an earlier Resolution dated 0ebruar/ (, .--), the #ourt had re@uired the parties to sub:it their respective Me:oranda %ithin ;- da/s fro: notice. 5l:ost a /ear passed but the parties had not sub:itted their respective :e:oranda. #onsiderin2 that ta esGthe lifeblood of our econo:/G are involved in the present controvers/, the #ourt %as pro:pted to dispense %ith the said pleadin2s, %ith the end vie% of advancin2 the interests of ?ustice and avoidin2 further dela/. In both petitions, 0"1S and NP# :aintain that the appeal before the 1$55 %as not ti:e!barred. 0"1S ar2ues that %hen NP# :oved to have the assess:ent reconsidered on Septe:ber ,, (77+, the runnin2 of the period to file an appeal %ith the 1$55 %as tolled. 0or its part, NP# posits that the )-!da/ period for appealin2 to the 1$55 should be rec&oned fro: its receipt of the denial of its :otion for reconsideration. PetitionersA contentions are bereft of :erit. Section ..) of R.5. No. ,()-, other%ise &no%n as the 1ocal 'overn:ent #ode of (77(, provides<

S"#TION ..). 1ocal $oard of 5ssess:ent 5ppeals. B 5n/ o%ner or person havin2 le2al interest in the propert/ %ho is not satisfied %ith the action of the provincial, cit/ or :unicipal assessor in the assess:ent of his propert/ :a/, %ithin si t/ 3)-4 da/s fro: the date of receipt of the %ritten notice of assess:ent, appeal to the $oard of 5ssess:ent 5ppeals of the province or cit/ b/ filin2 a petition under oath in the for: prescribed for the purpose, to2ether %ith copies of the ta declarations and such affidavits or docu:ents sub:itted in support of the appeal. =e note that the notice of assess:ent %hich the Provincial 5ssessor sent to 0"1S on 5u2ust ,, (77+, contained the follo%in2 state:ent< If /ou are not satisfied %ith this assess:ent, /ou :a/, %ithin si t/ 3)-4 da/s fro: the date of receipt hereof, appeal to the $oard of 5ssess:ent 5ppeals of the province b/ filin2 a petition under oath on the for: prescribed for the purpose, to2ether %ith copies of 5RPCTa Declaration and such affidavits or docu:ents sub:itted in support of the appeal. Instead of appealin2 to the $oard of 5ssess:ent 5ppeals 3as stated in the notice4, NP# opted to file a :otion for reconsideration of the Provincial 5ssessorAs decision, a re:ed/ not sanctioned b/ la%. The re:ed/ of appeal to the 1$55 is available fro: an adverse rulin2 or action of the provincial, cit/ or :unicipal assessor in the assess:ent of the propert/. It follo%s then that the deter:ination :ade b/ the respondent Provincial 5ssessor %ith re2ard to the ta abilit/ of the sub?ect real properties falls %ithin its po%er to assess properties for ta ation purposes sub?ect to appeal before the 1$55. =e full/ a2ree %ith the rationaliHation of the #5 in both #5!'.R. SP No. ),67- and #5!'.R. SP No. ),67(. The t%o divisions of the appellate court cited the case of #allanta v. Office of the O:buds:an, %here %e ruled that under Section ..) of R.5. No ,()-, the last action of the local assessor on a particular assess:ent shall be the notice of assess:ent9 it is this last action %hich 2ives the o%ner of the propert/ the ri2ht to appeal to the 1$55. The procedure li&e%ise does not per:it the propert/ o%ner the re:ed/ of filin2 a :otion for reconsideration before the local assessor. The pertinent holdin2 of the #ourt in #allanta is as follo%s< ITJhe sa:e #ode is e@uall/ clear that the a22rieved o%ners should have brou2ht their appeals before the 1$55. Enfortunatel/, despite the advice to this effect contained in their respective notices of assess:ent, the o%ners chose to brin2 their re@uests for a revie%Cread?ust:ent before the cit/ assessor, a re:ed/ not sanctioned b/ the la%. To allo% this procedure %ould indeed invite corruption in the s/ste: of appraisal and assess:ent. It convenientl/ courts a 2raft!prone situation %here values of real propert/ :a/ be initiall/ set unreasonabl/ hi2h, and then subse@uentl/ reduced upon the re@uest of a propert/ o%ner. In the latter instance, allusions of a possible covert, illicit trade!off cannot be avoided, and in fact can convenientl/ ta&e place. Such occasion for :ischief :ust be prevented and e cised fro: our s/ste:. 0or its part, the appellate court declared in #5!'.R. SP No. ),67(< . The #ourt announces< Henceforth, %henever the local assessor sends a notice to the o%ner or la%ful possessor of real propert/ of its revised assessed value, the for:er shall no lon2er have an/ ?urisdiction to entertain an/ re@uest for a revie% or read?ust:ent. The appropriate foru: %here the a22rieved part/ :a/ brin2 his appeal is the 1$55 as provided b/ la%. It follo%s ineluctabl/ that the )-!da/ period for :a&in2 the appeal to the 1$55 runs %ithout interruption. This is %hat =e held in SP ),67- and reaffir: toda/ in SP ),67(.

To reiterate, if the ta pa/er fails to appeal in due course, the ri2ht of the local 2overn:ent to collect the ta es due %ith respect to the ta pa/erAs propert/ beco:es absolute upon the e piration of the period to appeal. It also bears stressin2 that the ta pa/erAs failure to @uestion the assess:ent in the 1$55 renders the assess:ent of the local assessor final, e ecutor/ and de:andable, thus, precludin2 the ta pa/er fro: @uestionin2 the correctness of the assess:ent, or fro: invo&in2 an/ defense that %ould reopen the @uestion of its liabilit/ on the :erits. In fine, the 1$55 acted correctl/ %hen it dis:issed the petitionersA appeal for havin2 been filed out of ti:e9 the #$55 and the appellate court %ere li&e%ise correct in affir:in2 the dis:issal. "le:entar/ is the rule that the perfection of an appeal %ithin the period therefor is both :andator/ and ?urisdictional, and failure in this re2ard renders the decision final and e ecutor/. In the #o::ent filed b/ the Provincial 5ssessor, it is asserted that the instant petition is barred b/ res ?udicata9 that the final and e ecutor/ ?ud2:ent in '.R. No. ()+((; 3%here there %as a final deter:ination on the issue of prescription4, effectivel/ precludes the clai:s herein9 and that the filin2 of the instant petition after an adverse ?ud2:ent in '.R. No. ()+((; constitutes foru: shoppin2. 0"1S :aintains that the ar2u:ent of the Provincial 5ssessor is co:pletel/ :isplaced since it %as not a part/ to the erroneous petition %hich the NP# filed in '.R. No. ()+((;. It avers that it did not participate in the aforesaid proceedin2, and the Supre:e #ourt never ac@uired ?urisdiction over it. 5s to the issue of foru: shoppin2, petitioner clai:s that no foru: shoppin2 could have been co::itted since the ele:ents of litis pendentia or res ?udicata are not present. =e do not a2ree. Res ?udicata pervades ever/ or2aniHed s/ste: of ?urisprudence and is founded upon t%o 2rounds e:bodied in various :a i:s of co::on la%, na:el/< 3(4 public polic/ and necessit/, %hich :a&es it to the interest of the State that there should be an end to liti2ation B republicae ut sit litiu:9 and 3.4 the hardship on the individual of bein2 ve ed t%ice for the sa:e cause B ne:o debet bis ve ari et eade: causa. 5 conflictin2 doctrine %ould sub?ect the public peace and @uiet to the %ill and dereliction of individuals and prefer the re2ale:ent of the liti2ious disposition on the part of suitors to the preservation of the public tran@uilit/ and happiness. 5s %e ruled in Heirs of Trinidad De 1eon Vda. de Ro as v. #ourt of 5ppeals< 5n e istin2 final ?ud2:ent or decree B rendered upon the :erits, %ithout fraud or collusion, b/ a court of co:petent ?urisdiction actin2 upon a :atter %ithin its authorit/ B is conclusive on the ri2hts of the parties and their privies. This rulin2 holds in all other actions or suits, in the sa:e or an/ other ?udicial tribunal of concurrent ?urisdiction, touchin2 on the points or :atters in issue in the first suit.

#ourts %ill si:pl/ refuse to reopen %hat has been decided. The/ %ill not allo% the sa:e parties or their privies to liti2ate ane% a @uestion once it has been considered and decided %ith finalit/. 1iti2ations :ust end and ter:inate so:eti:e and so:e%here. The effective and efficient ad:inistration of ?ustice re@uires that once a ?ud2:ent has beco:e final, the prevailin2 part/ should not be deprived of the fruits of the verdict b/ subse@uent suits on the sa:e issues filed b/ the sa:e parties. This is in accordance %ith the doctrine of res ?udicata %hich has the follo%in2 ele:ents< 3(4 the for:er ?ud2:ent :ust be final9 3.4 the court %hich rendered it had ?urisdiction over the sub?ect

:atter and the parties9 3;4 the ?ud2:ent :ust be on the :erits9 and 364 there :ust be bet%een the first and the second actions, identit/ of parties, sub?ect :atter and causes of action. The application of the doctrine of res ?udicata does not re@uire absolute identit/ of parties but :erel/ substantial identit/ of parties. There is substantial identit/ of parties %hen there is co::unit/ of interest or privit/ of interest bet%een a part/ in the first and a part/ in the second case even if the first case did not i:plead the latter. To recall, 0"1S 2ave NP# the full po%er and authorit/ to represent it in an/ proceedin2 re2ardin2 real propert/ assess:ent. Therefore, %hen petitioner NP# filed its petition for revie% doc&eted as '.R. No. ()+((;, it did so not onl/ on its behalf but also on behalf of 0"1S. Moreover, the assailed decision in the earlier petition for revie% filed in this #ourt %as the decision of the appellate court in #5!'.R. SP No. ),67-, in %hich 0"1S %as the petitioner. Thus, the decision in '.R. No. ()+(() is bindin2 on petitioner 0"1S under the principle of privit/ of interest. In fine, 0"1S and NP# are substantiall/ Didentical partiesD as to %arrant the application of res ?udicata. 0"1SAs ar2u:ent that it is not bound b/ the erroneous petition filed b/ NP# is thus unavailin2. On the issue of foru: shoppin2, %e rule for the Provincial 5ssessor. 0oru: shoppin2 e ists %hen, as a result of an adverse ?ud2:ent in one foru:, a part/ see&s another and possibl/ favorable ?ud2:ent in another foru: other than b/ appeal or special civil action or certiorari. There is also foru: shoppin2 %hen a part/ institutes t%o or :ore actions or proceedin2s 2rounded on the sa:e cause, on the 2a:ble that one or the other court %ould :a&e a favorable disposition. Petitioner 0"1S alle2es that there is no foru: shoppin2 since the ele:ents of res ?udicata are not present in the cases at bar9 ho%ever, as alread/ discussed, res ?udicata :a/ be properl/ applied herein. Petitioners en2a2ed in foru: shoppin2 %hen the/ filed '.R. Nos. ()*++, and (,-).* after the petition for revie% in '.R. No. ()+((). Indeed, petitioners %ent fro: one court to another tr/in2 to 2et a favorable decision fro: one of the tribunals %hich allo%ed the: to pursue their cases. It :ust be stressed that an i:portant factor in deter:inin2 the e istence of foru: shoppin2 is the ve ation caused to the courts and the parties!liti2ants b/ the filin2 of si:ilar cases to clai: substantiall/ the sa:e reliefs. The rationale a2ainst foru: shoppin2 is that a part/ should not be allo%ed to pursue si:ultaneous re:edies in t%o different fora. 0ilin2 :ultiple petitions or co:plaints constitutes abuse of court processes, %hich tends to de2rade the ad:inistration of ?ustice, %rea&s havoc upon orderl/ ?udicial procedure, and adds to the con2estion of the heavil/ burdened doc&ets of the courts. Thus, there is foru: shoppin2 %hen there e ist< 3a4 identit/ of parties, or at least such parties as represent the sa:e interests in both actions, 3b4 identit/ of ri2hts asserted and relief pra/ed for, the relief bein2 founded on the sa:e facts, and 3c4 the identit/ of the t%o precedin2 particulars is such that an/ ?ud2:ent rendered in the pendin2 case, re2ardless of %hich part/ is successful, %ould a:ount to res ?udicata in the other. Havin2 found that the ele:ents of res ?udicata and foru: shoppin2 are present in the consolidated cases, a discussion of the other issues is no lon2er necessar/. Nevertheless, for the peace and content:ent of petitioners, %e shall shed li2ht on the :erits of the case. 5s found b/ the appellate court, the #$55 and 1$55 po%er bar2es are real propert/ and are thus sub?ect to real propert/ ta . This is also the inevitable conclusion, considerin2 that '.R. No. ()+((; %as dis:issed for failure to sufficientl/ sho% an/ reversible error. Ta assess:ents b/ ta e a:iners are presu:ed correct and :ade in 2ood faith, %ith the ta pa/er havin2 the burden of provin2 other%ise. $esides, factual findin2s of ad:inistrative bodies, %hich have ac@uired e pertise in their field, are 2enerall/ bindin2 and conclusive upon the #ourt9 %e %ill not assu:e to

interfere %ith the sensible e ercise of the ?ud2:ent of :en especiall/ trained in appraisin2 propert/. =here the ?udicial :ind is left in doubt, it is a sound polic/ to leave the assess:ent undisturbed. =e find no reason to depart fro: this rule in this case. In #onsolidated "dison #o:pan/ of Ne% >or&, Inc., et al. v. The #it/ of Ne% >or&, et al., a po%er co:pan/ brou2ht an action to revie% propert/ ta assess:ent. On the cit/As :otion to dis:iss, the Supre:e #ourt of Ne% >or& held that the bar2es on %hich %ere :ounted 2as turbine po%er plants desi2nated to 2enerate electrical po%er, the fuel oil bar2es %hich supplied fuel oil to the po%er plant bar2es, and the accessor/ e@uip:ent :ounted on the bar2es %ere sub?ect to real propert/ ta ation. Moreover, 5rticle 6(+ 374 of the Ne% #ivil #ode provides that DIdJoc&s and structures %hich, thou2h floatin2, are intended b/ their nature and ob?ect to re:ain at a fi ed place on a river, la&e, or coastD are considered i::ovable propert/. Thus, po%er bar2es are cate2oriHed as i::ovable propert/ b/ destination, bein2 in the nature of :achiner/ and other i:ple:ents intended b/ the o%ner for an industr/ or %or& %hich :a/ be carried on in a buildin2 or on a piece of land and %hich tend directl/ to :eet the needs of said industr/ or %or&. Petitioners :aintain nevertheless that the po%er bar2es are e e:pt fro: real estate ta under Section .;6 3c4 of R.5. No. ,()- because the/ are actuall/, directl/ and e clusivel/ used b/ petitioner NP#, a 2overn:ent! o%ned and controlled corporation en2a2ed in the suppl/, 2eneration, and trans:ission of electric po%er. =e affir: the findin2s of the 1$55 and #$55 that the o%ner of the ta able properties is petitioner 0"1S, %hich in fine, is the entit/ bein2 ta ed b/ the local 2overn:ent. 5s stipulated under Section ..((, 5rticle . of the 52ree:ent< O=N"RSHIP O0 PO="R $5R'"S. PO15R shall o%n the Po%er $ar2es and all the fi tures, fittin2s, :achiner/ and e@uip:ent on the Site used in connection %ith the Po%er $ar2es %hich have been supplied b/ it at its o%n cost. PO15R shall operate, :ana2e and :aintain the Po%er $ar2es for the purpose of convertin2 0uel of N5PO#OR into electricit/. It follo%s then that 0"1S cannot escape liabilit/ fro: the pa/:ent of realt/ ta es b/ invo&in2 its e e:ption in Section .;6 3c4 of R.5. No. ,()-, %hich reads< S"#TION .;6. " e:ptions fro: Real Propert/ Ta . B The follo%in2 are e e:pted fro: pa/:ent of the real propert/ ta <

3c4 5ll :achineries and e@uip:ent that are actuall/, directl/ and e clusivel/ used b/ local %ater districts and 2overn:ent!o%ned or controlled corporations en2a2ed in the suppl/ and distribution of %ater andCor 2eneration and trans:ission of electric po%er9 Indeed, the la% states that the :achiner/ :ust be actuall/, directl/ and e clusivel/ used b/ the 2overn:ent o%ned or controlled corporation9 nevertheless, petitioner 0"1S still cannot find solace in this provision because Section +.+, 5rticle + of the 52ree:ent provides< OP"R5TION. PO15R underta&es that until the end of the 1ease Period, sub?ect to the suppl/ of the necessar/ 0uel pursuant to 5rticle ) and to the other provisions hereof, it %ill operate the Po%er $ar2es to convert such 0uel into electricit/ in accordance %ith Part 5 of 5rticle ,.

It is a basic rule that obli2ations arisin2 fro: a contract have the force of la% bet%een the parties. Not bein2 contrar/ to la%, :orals, 2ood custo:s, public order or public polic/, the parties to the contract are bound b/ its ter:s and conditions. Ti:e and a2ain, the Supre:e #ourt has stated that ta ation is the rule and e e:ption is the e ception. The la% does not loo& %ith favor on ta e e:ptions and the entit/ that %ould see& to be thus privile2ed :ust ?ustif/ it b/ %ords too plain to be :ista&en and too cate2orical to be :isinterpreted. Thus, appl/in2 the rule of strict construction of la%s 2rantin2 ta e e:ptions, and the rule that doubts should be resolved in favor of provincial corporations, %e hold that 0"1S is considered a ta able entit/. The :ere underta&in2 of petitioner NP# under Section (-.( of the 52ree:ent, that it shall be responsible for the pa/:ent of all real estate ta es and assess:ents, does not ?ustif/ the e e:ption. The privile2e 2ranted to petitioner NP# cannot be e tended to 0"1S. The covenant is bet%een 0"1S and NP# and does not bind a third person not priv/ thereto, in this case, the Province of $atan2as. It :ust be pointed out that the protracted and circuitous liti2ation has seriousl/ resulted in the local 2overn:entAs deprivation of revenues. The po%er to ta is an incident of soverei2nt/ and is unli:ited in its :a2nitude, ac&no%led2in2 in its ver/ nature no peri:eter so that securit/ a2ainst its abuse is to be found onl/ in the responsibilit/ of the le2islature %hich i:poses the ta on the constituenc/ %ho are to pa/ for it. The ri2ht of local 2overn:ent units to collect ta es due :ust al%a/s be upheld to avoid severe ta erosion. This consideration is consistent %ith the State polic/ to 2uarantee the autono:/ of local 2overn:ents and the ob?ective of the 1ocal 'overn:ent #ode that the/ en?o/ 2enuine and :eanin2ful local autono:/ to e:po%er the: to achieve their fullest develop:ent as self!reliant co::unities and :a&e the: effective partners in the attain:ent of national 2oals. In conclusion, %e reiterate that the po%er to ta is the :ost potent instru:ent to raise the needed revenues to finance and support :/riad activities of the local 2overn:ent units for the deliver/ of basic services essential to the pro:otion of the 2eneral %elfare and the enhance:ent of peace, pro2ress, and prosperit/ of the people. =H"R"0OR", the Petitions are D"NI"D and the assailed Decisions and Resolutions 500IRM"D. SO ORD"R"D. ROMEO 3. C$LLE3O, SR. 5ssociate 8ustice