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MIAA Vs CA - Digest
MIAA Vs CA - Digest
MIAA Vs CA - Digest
COURT OF APPEALS, CITY OF PARAAQUE, CITY MAYOR OF PARAAQUE, SANGGUNIANG PANGLUNGSOD NG PARAAQUE, CITY ASSESSOR OF PARAAQUE, and CITY TREASURER OF PARAAQUE, respondents G.R. No. 155650, !"# $0, $006 Facts: MIAA received Final Notices of Real Estate Tax Delinquency from t e !ity of "ara#aque for t e taxa$le years %&&' to '((%. MIAA)s real estate tax delinquency *as estimated at "+', million. T e !ity of "ara#aque, t rou- its !ity Treasurer, issued notices of levy and *arrants of levy on t e Airport .ands and /uildin-s. T e Mayor of t e !ity of "ara#aque t reatened to sell at pu$lic auction t e Airport .ands and /uildin-s s ould MIAA fail to pay t e real estate tax delinquency. MIAA filed *it t e !ourt of Appeals an ori-inal petition for pro i$ition and in0unction, *it prayer for preliminary in0unction or temporary restrainin- order. T e petition sou- t to restrain t e !ity of "ara#aque from imposin- real estate tax on, levyin- a-ainst, and auctionin- for pu$lic sale t e Airport .ands and /uildin-s. "aranaque)s !ontention1 2ection %&3 of t e .ocal 4overnment !ode expressly *it dre* t e tax exemption privile-es of 5-overnment6o*ned and6controlled corporations7 upon t e effectivity of t e .ocal 4overnment !ode. Respondents also ar-ue t at a $asic rule of statutory construction is t at t e express mention of one person, t in-, or act excludes all ot ers. An international airport is not amon- t e exceptions mentioned in 2ection %&3 of t e .ocal 4overnment !ode. T us, respondents assert t at MIAA cannot claim t at t e Airport .ands and /uildin-s are exempt from real estate tax. MIAA)s contention1 Airport .ands and /uildin-s are o*ned $y t e Repu$lic. T e -overnment cannot tax itself. T e reason for tax exemption of pu$lic property is t at its taxation *ould not inure to any pu$lic advanta-e, since in suc a case t e tax de$tor is also t e tax creditor. Issue: 89N Airport .ands and /uildin-s of MIAA are exempt from real estate tax under existin- la*s: ;es. Er-o, t e real estate tax assessments issued $y t e !ity of "ara#aque, and all proceedin-s ta<en pursuant to suc assessments, are void. Ruling: MIAA is Not a 4overnment69*ned or !ontrolled !orporation MIAA is not a -overnment6o*ned or controlled corporation $ut an instrumentality of t e National 4overnment and t us exempt from local taxation. MIAA is not a stoc< corporation $ecause it as no capital stoc< divided into s ares. MIAA as no stoc< olders or votin- s ares. MIAA is also not a non6stoc< corporation $ecause it as no mem$ers. A non6stoc< corporation must ave mem$ers. MIAA is a -overnment instrumentality vested *it corporate po*ers to perform efficiently its -overnmental functions. MIAA is li<e any ot er -overnment instrumentality, t e only difference is t at MIAA is vested *it corporate po*ers. 8 en t e la* vests in a -overnment instrumentality corporate po*ers, t e instrumentality does not $ecome a corporation. =nless t e -overnment instrumentality is or-ani>ed as a stoc< or non6 stoc< corporation, it remains a -overnment instrumentality exercisin- not only -overnmental $ut also corporate po*ers. T us, MIAA exercises t e -overnmental po*ers of eminent domain, police aut ority and t e levyin- of fees and c ar-es. At t e same time, MIAA exercises 5all t e po*ers of a corporation under t e !orporation .a*, insofar as t ese po*ers are not inconsistent *it t e provisions of t is Executive 9rder.7 Airport .ands and /uildin-s of MIAA are 9*ned $y t e Repu$lic a. Airport .ands and /uildin-s are of "u$lic Dominion
T e Airport .ands and /uildin-s of MIAA are property of pu$lic dominion and t erefore o*ned $y t e 2tate or t e Repu$lic of t e " ilippines. No one can dispute t at properties of pu$lic dominion mentioned in Article ,'( of t e !ivil !ode, li<e 5roads, canals, rivers, torrents, ports and $rid-es constructed $y t e 2tate,7 are o*ned $y t e 2tate. T e term 5ports7 includes seaports and airports. T e MIAA Airport .ands and /uildin-s constitute a 5port7 constructed $y t e 2tate. =nder Article ,'( of t e !ivil !ode, t e MIAA Airport .ands and /uildin-s are properties of pu$lic dominion and t us o*ned $y t e 2tate or t e Repu$lic of t e " ilippines. T e Airport .ands and /uildin-s are devoted to pu$lic use $ecause t ey are used $y t e pu$lic for international and domestic travel and transportation. T e fact t at t e MIAA collects terminal fees and ot er c ar-es from t e pu$lic does not remove t e c aracter of t e Airport .ands and /uildin-s as properties for pu$lic use. T e c ar-in- of fees to t e pu$lic does not determine t e c aracter of t e property * et er it is of pu$lic dominion or not. Article ,'( of t e !ivil !ode defines property of pu$lic dominion as one 5intended for pu$lic use.7 T e terminal fees MIAA c ar-es to passen-ers, as *ell as t e landinfees MIAA c ar-es to airlines, constitute t e $ul< of t e income t at maintains t e operations of MIAA. T e collection of suc fees does not c an-e t e c aracter of MIAA as an airport for pu$lic use. 2uc fees are often termed user)s tax. T is means taxin- t ose amon- t e pu$lic * o actually use a pu$lic facility instead of taxin- all t e pu$lic includin- t ose * o never use t e particular pu$lic facility. $. Airport .ands and /uildin-s are 9utside t e !ommerce of Man
T e !ourt as also ruled t at property of pu$lic dominion, $ein- outside t e commerce of man, cannot $e t e su$0ect of an auction sale. "roperties of pu$lic dominion, $ein- for pu$lic use, are not su$0ect to levy, encum$rance or disposition t rou- pu$lic or private sale. Any encum$rance, levy on execution or auction sale of any property of pu$lic dominion is void for $ein- contrary to pu$lic policy. Essential pu$lic services *ill stop if properties of pu$lic dominion are su$0ect to encum$rances, foreclosures and auction sale. T is *ill appen if t e !ity of "ara#aque can foreclose and compel t e auction sale of t e +((6 ectare run*ay of t e MIAA for non6payment of real estate tax. c. MIAA is a Mere Trustee of t e Repu$lic
MIAA is merely oldin- title to t e Airport .ands and /uildin-s in trust for t e Repu$lic. 2ection ,?, ! apter %', /oo< I of t e Administrative !ode allo*s instrumentalities li<e MIAA to old title to real properties o*ned $y t e Repu$lic. n MIAA)s case, its status as a mere trustee of t e Airport .ands and /uildin-s is clearer $ecause even its executive ead cannot si-n t e deed of conveyance on $e alf of t e Repu$lic. 9nly t e "resident of t e Repu$lic can si-n suc deed of conveyance. d. Transfer to MIAA *as Meant to Implement a Reor-ani>ation
T e transfer of t e Airport .ands and /uildin-s from t e /ureau of Air Transportation to MIAA *as not meant to transfer $eneficial o*ners ip of t ese assets from t e Repu$lic to MIAA. T e purpose *as merely toreor-ani>e a division in t e /ureau of Air Transportation into a separate and autonomous $ody. T e Repu$lic remains t e $eneficial o*ner of t e Airport .ands and /uildin-s. MIAA itself is o*ned solely $y t e Repu$lic. No party claims any o*ners ip ri- ts over MIAA)s assets adverse to t e Repu$lic. e. Real "roperty 9*ned $y t e Repu$lic is Not Taxa$le
2ec '3, of t e .4! provides t at real property o*ned $y t e Repu$lic of t e " ilippines or any of its political su$divisions except * en t e $eneficial use t ereof as $een -ranted, for consideration or ot er*ise, to a taxa$le person follo*in- are exempted from payment of t e real property tax. @o*ever, portions of t e Airport .ands and /uildin-s t at MIAA leases to private entities are not exempt from real estate tax. For example, t e land area occupied $y an-ars t at MIAA leases to private corporations is su$0ect to real estate tax.