Republic of the Philippines

SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 107916 February 20, 1997

PERCIVAL MODAY, ZOTICO MODAY (deceased) and LEONORA MODAY, petitioners,

vs.
COURT OF APPEALS, JUDGE EVANGELINE S. YUIPCO OF BRANCH 6, REGIONAL TRIAL COURT,
AGUSAN DEL SUR AND MUNICIPALITY OF BUNAWAN, respondents.

ROMERO, J.:

The main issue presented in this case is whether a municipality may expropriate private property by virtue
of a municipal resolution which was disapproved by the Sangguniang Panlalawigan. Petitioner seeks the
reversal of the Court of Appeals decision and resolution, promulgated on July 15, 1992 and October 22,
1992 respectively, 1 and a declaration that Municipal Resolution No. 43-89 of the Bunawan Sangguniang
Bayan is null and void.

On July 23, 1989, the Sangguniang Bayan of the Municipality of Bunawan in Agusan del Sur passed
Resolution No. 43-89, "Authorizing the Municipal Mayor to Initiate the Petition for Expropriation of a One
(1) Hectare Portion of Lot No. 6138-Pls-4 Along the National Highway Owned by Percival Moday for the
Site of Bunawan Farmers Center and Other Government Sports Facilities." 2

In due time, Resolution No. 43-89 was approved by then Municipal Mayor Anuncio C. Bustillo and
transmitted to the Sangguniang Panlalawigan for its approval. On September 11, 1989, the Sangguniang
Panlalawigan disapproved said Resolution and returned it with the comment that "expropriation is
unnecessary considering that there are still available lots in Bunawan for the establishment of the
government center." 3

The Municipality of Bunawan, herein public respondent, subsequently filed a petition for Eminent Domain
against petitioner Percival Moday before the Regional Trial Court at Prosperidad, Agusan del Sur. 4 The
complaint was later amended to include the registered owners, Percival Moday's parents, Zotico and
Leonora Moday, as party defendants.

On March 6, 1991, public respondent municipality filed a Motion to Take or Enter Upon the Possession of
Subject Matter of This Case stating that it had already deposited with the municipal treasurer the necessary
amount in accordance with Section 2, Rule 67 of the Revised Rules of Court and that it would be in the
government's best interest for public respondent to be allowed to take possession of the property.

Despite petitioners' opposition and after a hearing on the merits, the Regional Trial Court granted
respondent municipality's motion to take possession of the land. The lower court held that the Sangguniang
Panlalawigan's failure to declare the resolution invalid leaves it effective. It added that the duty of the
Sangguniang Panlalawigan is merely to review the ordinances and resolutions passed by the Sangguniang
Bayan under Section 208 (1) of B.P. Blg. 337, old Local Government Code and that the exercise of eminent
domain is not one of the two acts enumerated in Section 19 thereof requiring the approval of the
Sangguniang Panlalawigan. 5 The dispositive portion of the lower court's Order dated July 2, 1991 reads:
 WHEREFORE, it appearing that the amount of P632.39 had been deposited as per Official
Receipt No. 5379647 on December 12, 1989 which this Court now determines as the
provisional value of the land, the Motion to Take or Enter Upon the Possession of the
Property filed by petitioner through counsel is hereby GRANTED. The Sheriff of this Court
is ordered to forthwith place the plaintiff in possession of the property involved.

Let the hearing be set on August 9, 1991 at 8:30 o'clock in the morning for the purpose of
ascertaining the just compensation or fair market value of the property sought to be taken,
with notice to all the parties concerned.

SO ORDERED. 6

Petitioners' motion for reconsideration was denied by the trial court on October 31, 1991.

Petitioners elevated the case in a petition for certiorari alleging grave abuse of discretion on the part of the
trial court, but the same was dismissed by respondent appellate court on July 15, 1992. 7 The Court of
Appeals held that the public purpose for the expropriation is clear from Resolution No. 43-89 and that since
the Sangguniang Panlalawigan of Agusan del Sur did not declare Resolution No. 43-89 invalid,
expropriation of petitioners' property could proceed.

Respondent appellate court also denied petitioners' motion for reconsideration on October 22, 1992. 8

Meanwhile, the Municipality of Bunawan had erected three buildings on the subject property: the
Association of Barangay Councils (ABC) Hall, the Municipal Motorpool, both wooden structures, and the
Bunawan Municipal Gymnasium, which is made of concrete.

In the instant petition for review filed on November 23, 1992, petitioner seeks the reversal of the decision
and resolution of the Court of Appeals and a declaration that Resolution No. 43-89 of the Municipality of
Bunawan is null and void.

On December 8, 1993, the Court issued a temporary restraining order enjoining and restraining public
respondent Judge Evangeline Yuipco from enforcing her July 2, 1991 Order and respondent municipality
from using and occupying all the buildings constructed and from further constructing any building on the
land subject of this petition. 9

Acting on petitioners' Omnibus Motion for Enforcement of Restraining Order and for Contempt, the Court
issued a Resolution on March 15, 1995, citing incumbent municipal mayor Anuncio C. Bustillo for contempt,
ordering him to pay the fine and to demolish the "blocktiendas" which were built in violation of the restraining
order. 10

Former Mayor Anuncio C. Bustillo paid the fine and manifested that he lost in the May 8, 1995
election. 11 The incumbent Mayor Leonardo Barrios, filed a Manifestation, Motion to Resolve "Urgent Motion
for Immediate Dissolution of the Temporary Restraining Order" and Memorandum on June 11, 1996 for the
Municipality of Bunawan. 12

Petitioners contend that the Court of Appeals erred in upholding the legality of the condemnation
proceedings initiated by the municipality. According to petitioners, the expropriation was politically
motivated and Resolution No. 43-89 was correctly disapproved by the Sangguniang Panlalawigan, there
being other municipal properties available for the purpose. Petitioners also pray that the former Mayor
Anuncio C. Bustillo be ordered to pay damages for insisting on the enforcement of a void municipal
resolution.
The Court of Appeals declared that the Sangguniang Panlalawigan's reason for disapproving the resolution
"could be baseless, because it failed to point out which and where are those available lots.'" Respondent
court also concluded that since the Sangguniang Panlalawigan did not declare the municipal board's
resolution as invalid, expropriation of petitioners' property could
proceed. 13

The Court finds no merit in the petition and affirms the decision of the Court of Appeals.

Eminent domain, the power which the Municipality of Bunawan exercised in the instant case, is a
fundamental State power that is inseparable from sovereignty. 14 It is government's right to appropriate, in
the nature of a compulsory sale to the State, private property for public use or purpose. 15 Inherently
possessed by the national legislature, the power of eminent domain may be validly delegated to local
governments, other public entities and public utilities. 16For the taking of private property by the government
to be valid, the taking must be for public use and there must be just compensation. 17

The Municipality of Bunawan's power to exercise the right of eminent domain is not disputed as it is
expressly provided for in Batas Pambansa Blg. 337, the local Government Code 18 in force at the time
expropriation proceedings were initiated. Section 9 of said law states:

Sec. 9. Eminent Domain. A local government unit may, through its head and acting
pursuant to a resolution of its sanggunian, exercise the right of eminent domain and
institute condemnation proceedings for public use or purpose.

What petitioners question is the lack of authority of the municipality to exercise this right since the
Sangguniang Panlalawigan disapproved Resolution No. 43-89.

Section 153 of B.P. Blg. 337 provides:

Sec. 153. Sangguniang Panlalawigan Review. (1) Within thirty days after receiving
copies of approved ordinances, resolutions and executive orders promulgated by the
municipal mayor, the sangguniang panlalawigan shall examine the documents or transmit
them to the provincial attorney, or if there be none, to the provincial fiscal, who shall
examine them promptly and inform the sangguniang panlalawigan in writing of any defect
or impropriety which he may discover therein and make such comments or
recommendations as shall appear to him proper.

(2) If the sangguniang panlalawigan shall find that any municipal ordinance, resolution or
executive order is beyond the power conferred upon the sangguniang bayan or the mayor,
it shall declare such ordinance, resolution or executive order invalid in whole or in part,
entering its actions upon the minutes and advising the proper municipal authorities thereof.
The effect of such an action shall be to annul the ordinance, resolution or executive order
in question in whole or in part. The action of the sangguniang panlalawigan shall be final.

xxx xxx xxx (Emphasis supplied.)

The Sangguniang Panlalawigan's disapproval of Municipal Resolution No. 43-89 is an infirm action which
does not render said resolution null and void. The law, as expressed in Section 153 of B.P. Blg. 337, grants
the Sangguniang Panlalawigan the power to declare a municipal resolution invalid on the sole ground that
it is beyond the power of the Sangguniang Bayan or the Mayor to issue. Although pertaining to a similar
provision of law but different factual milieu then obtaining, the Court's pronouncements in Velazco
v. Blas, 19 where we cited significant early jurisprudence, are applicable to the case at bar.
 The only ground upon which a provincial board may declare any municipal resolution,
ordinance, or order invalid is when such resolution, ordinance, or order is "beyond the
powers conferred upon the council or president making the same." Absolutely no other
ground is recognized by the law. A strictly legal question is before the provincial board in
its consideration of a municipal resolution, ordinance, or order. The provincial (board's)
disapproval of any resolution, ordinance, or order must be premised specifically upon the
fact that such resolution, ordinance, or order is outside the scope of the legal powers
conferred by law. If a provincial board passes these limits, it usurps the legislative function
of the municipal council or president. Such has been the consistent course of executive
authority. 20

Thus, the Sangguniang Panlalawigan was without the authority to disapprove Municipal Resolution No. 43-
89 for the Municipality of Bunawan clearly has the power to exercise the right of eminent domain and its
Sangguniang Bayan the capacity to promulgate said resolution, pursuant to the earlier-quoted Section 9 of
B.P. Blg. 337. Perforce, it follows that Resolution No. 43-89 is valid and binding and could be used as lawful
authority to petition for the condemnation of petitioners' property.

As regards the accusation of political oppression, it is alleged that Percival Moday incurred the ire of then
Mayor Anuncio C. Bustillo when he refused to support the latter's candidacy for mayor in previous elections.
Petitioners claim that then incumbent Mayor C. Bustillo used the expropriation to retaliate by expropriating
their land even if there were other properties belonging to the municipality and available for the purpose.
Specifically, they allege that the municipality owns a vacant seven-hectare property adjacent to petitioners'
land, evidenced by a sketch plan. 21

The limitations on the power of eminent domain are that the use must be public, compensation must be
made and due process of law must be
observed. 22 The Supreme Court, taking cognizance of such issues as the adequacy of compensation,
necessity of the taking and the public use character or the purpose of the taking, 23 has ruled that the
necessity of exercising eminent domain must be genuine and of a public character. 24 Government may not
capriciously choose what private property should be taken.

After a careful study of the records of the case, however, we find no evidentiary support for petitioners'
allegations. The uncertified photocopy of the sketch plan does not conclusively prove that the municipality
does own vacant land adjacent to petitioners' property suited to the purpose of the expropriation. In the
questioned decision, respondent appellate court similarly held that the pleadings and documents on record
have not pointed out any of respondent municipality's "other available properties available for the same
purpose." 25 The accusations of political reprisal are likewise unsupported by competent evidence.
Consequently, the Court holds that petitioners' demand that the former municipal mayor be personally liable
for damages is without basis.

WHEREFORE, the instant petition is hereby DENIED. The questioned Decision and Resolution of the Court
of Appeals in the case of "Percival Moday." et al. v. Municipality of Bunawan, et al." (CA G.R. SP No. 26712)
are AFFIRMED. The Temporary Restraining Order issued by the Court on December 8, 1993 is LIFTED.

SO ORDERED.
MUNICIPALITY OF PARAAQUE, petitioner,

vs.

V.M. REALTY CORPORATION, respondent.

A local government unit (LGU), like the Municipality of Paraaque, cannot authorize an expropriation of
private property through a mere resolution of its lawmaking body. The Local Government Code expressly
and clearly requires an ordinance or a local law for the purpose. A resolution that merely expresses the

sentiment or opinion of the Municipal Council will not suffice. On the other hand, the principle of res
judicata does not bar subsequent proceedings for the expropriation of the same property when all the legal
requirements for its valid exercise are complied with.

Statement of the Case

These principles are applied by this Court in resolving this petition for review on certiorari of the July 22,
1996 Decision 1 of the Court of Appeals 2 in CA GR CV No. 48048, which affirmed in toto 3 the
Regional Trial Court's August 9, 1994 Resolution. 4 The trial court dismissed the expropriation suit
as follows:

The right of the plaintiff to exercise the power of eminent domain is not disputed.
However, such right may be exercised only pursuant to an Ordinance (Sec. 19, R.A
No. 7160). In the instant case, there is no such ordinance passed by the Municipal
Council of Paraaque enabling the Municipality, thru its Chief Executive, to exercise
the power of eminent domain. The complaint, therefore, states no cause of action.

Assuming that plaintiff has a cause of action, the same is barred by a prior judgment.
On September 29, 1987, the plaintiff filed a complaint for expropriation involving the
same parcels of land which was docketed as Civil Case No. 17939 of this Court (page
26, record). Said case was dismissed with prejudice on May 18, 1988 (page 39,
record). The order of dismissal was not appealed, hence, the same became final. The
plaintiff can not be allowed to pursue the present action without violating the
principle of [r]es [j]udicata. While defendant in Civil Case No. 17939 was Limpan
Investment Corporation, the doctrine of res judicata still applies because the
judgment in said case (C.C. No. 17939) is conclusive between the parties and their
successors-in-interest (Vda. de Buncio vs. Estate of the late Anita de Leon). The
herein defendant is the successor-in-interest of Limpan Investment Corporation as
shown by the "Deed of Assignment Exchange" executed on June 13, 1990.

WHEREFORE, defendant's motion for reconsideration is hereby granted. The order

dated February 4, 1994 is vacated and set aside.

This case is hereby dismissed. No pronouncement as to costs.

SO ORDERED. 5

Factual Antecedents
Pursuant to Sangguniang Bayan Resolution No. 93-95, Series of 1993, 6 the Municipality of
Paraaque filed on September 20, 1993, a Complaint for expropriation 7 against Private Respondent
V.M. Realty Corporation over two parcels of land (Lots 2-A-2 and 2-B-1 of Subdivision Plan Psd-
17917), with a combined area of about 10,000 square meters, located at Wakas, San Dionisio,
Paraaque, Metro Manila, and covered by Torrens Certificate of Title No. 48700. Allegedly, the
complaint was filed "for the purpose of alleviating the living conditions of the underprivileged by
providing homes for the homeless through a socialized housing project." 8 Parenthetically, it was
also for this stated purpose that petitioner, pursuant to its Sangguniang Bayan Resolution No. 577,
Series of 1991, 9 previously made an offer to enter into a negotiated sale of the property with private
respondent, which the latter did not accept. 10

Finding the Complaint sufficient in form and substance, the Regional Trial Court of Makati, Branch
134, issued an Order dated January 10, 1994, 11 giving it due course. Acting on petitioner's motion,
said court issued an Order dated February 4, 1994, 12 authorizing petitioner to take possession of
the subject property upon deposit with its clerk of court of an amount equivalent to 15 percent of
its fair market value based on its current tax declaration.

On February 21, 1994, private respondent filed its Answer containing affirmative defenses and a
counterclaim, 13 alleging in the main that (a) the complaint failed to state a cause of action because
it was filed pursuant to a resolution and not to an ordinance as required by RA 7160 (the Local
Government Code); and (b) the cause of action, if any, was barred by a prior judgment or res
judicata. On private respondent's motion, its Answer was treated as a motion to dismiss. 14 On
March 24, 1991, 15 petitioner filed its opposition, stressing that the trial court's Order dated February
4, 1994 was in accord with Section 19 of RA 7160, and that the principle of res judicata was not
applicable.

Thereafter, the trial court issued its August 9, 1994 Resolution 16 nullifying its February 4, 1994
Order and dismissing the case. Petitioner's motions for reconsideration and transfer of venue were
denied by the trial court in a Resolution dated December 2, 1994. 17 Petitioner then appealed to
Respondent Court, raising the following issues:

1. Whether or not the Resolution of the Paraaque Municipal Council

No. 93-95, Series of 1993 is a substantial compliance of the statutory
requirement of Section 19, R.A. 7180 [sic] in the exercise of the power
of eminent domain by the plaintiff-appellant.

2. Whether or not the complaint in this case states no cause of action.

3. Whether or not the strict adherence to the literal observance to the

rule of procedure resulted in technicality standing in the way of
substantial justice.

4. Whether or not the principle of res judicata is applicable to the

present case. 18

As previously mentioned, the Court of Appeals affirmed in toto the trial court's Decision.
Respondent Court, in its assailed Resolution promulgated on January 8, 1997, 19 denied petitioner's
Motion for Reconsideration for lack of merit.

Hence, this appeal. 20

The Issues
Before this Court, petitioner posits two issues, viz.:

1. A resolution duly approved by the municipal council has the same force and effect
of an ordinance and will not deprive an expropriation case of a valid cause of action.

2. The principle of res judicata as a ground for dismissal of case is not applicable
when public interest is primarily involved. 21

The Court's Ruling

The petition is not meritorious.

First Issue:

Resolution Different from an Ordinance

Petitioner contends that a resolution approved by the municipal council for the purpose of initiating
an expropriation case "substantially complies with the requirements of the law" 22 because the
terms "ordinance" and "resolution" are synonymous for "the purpose of bestowing authority [on]
the local government unit through its chief executive to initiate the expropriation proceedings in
court in the exercise of the power of eminent domain." 23 Petitioner seeks to bolster this contention
by citing Article 36, Rule VI of the Rules and Regulations Implementing the Local Government Code,
which provides. "If the LGU fails to acquire a private property for public use, purpose, or welfare
through purchase, the LGU may expropriate said property through a resolution of
the Sanggunian authorizing its chief executive to initiate expropriation proceedings." 24 (Emphasis
supplied.)

The Court disagrees. The power of eminent domain is lodged in the legislative branch of
government, which may delegate the exercise thereof to LGUs, other public entities and public
utilities. 25 An LGU may therefore exercise the power to expropriate private property only when
authorized by Congress and subject to the latter's control and restraints, imposed "through the law
conferring the power or in other legislations." 26 In this case, Section 19 of RA 7160, which delegates
to LGUs the power of eminent domain, also lays down the parameters for its exercise. It provides
as follows:

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. (Emphasis supplied)

Thus, the following essential requisites must concur before an LGU can exercise the power of
eminent domain:
 1. An ordinance is enacted by the local legislative council authorizing the local chief
executive, in behalf of the LGU, to exercise the power of eminent domain or pursue
expropriation proceedings over a particular private property.

2. The power of eminent domain is exercised for public use, purpose or welfare, or
for the benefit of the poor and the landless.

3. There is payment of just compensation, as required under Section 9, Article III of

the Constitution, and other pertinent laws.

4. A valid and definite offer has been previously made to the owner of the property
sought to be expropriated, but said offer was not accepted. 27

In the case at bar, the local chief executive sought to exercise the power of eminent domain
pursuant to a resolution of the municipal council. Thus, there was no compliance with the first
requisite that the mayor be authorized through an ordinance. Petitioner cites Camarines Sur vs.
Court of Appeals 28 to show that a resolution may suffice to support the exercise of eminent domain
by an LGU. 29 This case, however, is not in point because the applicable law at that time was BP
337, 30 the previous Local Government Code, which had provided that a mere resolution would
enable an LGU to exercise eminent domain. In contrast, RA 7160, 31 the present Local Government
Code which was already in force when the Complaint for expropriation was filed, explicitly required
an ordinance for this purpose.

We are not convinced by petitioner's insistence that the terms "resolution" and "ordinance" are
synonymous. A municipal ordinance is different from a resolution. An ordinance is a law, but a
resolution is merely a declaration of the sentiment or opinion of a lawmaking body on a specific
matter. 32 An ordinance possesses a general and permanent character, but a resolution is temporary
in nature. Additionally, the two are enacted differently a third reading is necessary for an
ordinance, but not for a resolution, unless decided otherwise by a majority of all
the Sanggunian members. 33

If Congress intended to allow LGUs to exercise eminent domain through a mere resolution, it would
have simply adopted the language of the previous Local Government Code. But Congress did not.
In a clear divergence from the previous Local Government Code, Section 19 of RA 7160
categorically requires that the local chief executive act pursuant to an ordinance. Indeed,
"[l]egislative intent is determined principally from the language of a statute. Where the language of
a statute is clear and unambiguous, the law is applied according to its express terms, and
interpretation would be resorted to only where a literal interpretation would be resorted to only
where a literal interpretation would be either impossible or absurd or would lead to an
injustice." 34 In the instant case, there is no reason to depart from this rule, since the law requiring
an ordinance is not at all impossible, absurd, or unjust.

Moreover, the power of eminent domain necessarily involves a derogation of a fundamental or

private right of the people. 35 Accordingly, the manifest change in the legislative language from
"resolution" under BP 337 to "ordinance" under RA 7160 demands a strict construction. "No
species of property is held by individuals with greater tenacity, and is guarded by the Constitution
and laws more sedulously, than the right to the freehold of inhabitants. When the legislature
interferes with that right and, for greater public purposes, appropriates the land of an individual
without his consent, the plain meaning of the law should not be enlarged by doubtful
interpretation." 36

Petitioner relies on Article 36, Rule VI of the Implementing Rules, which requires only a resolution
to authorize an LGU to exercise eminent domain. This is clearly misplaced, because Section 19 of
RA 7160, the law itself, surely prevails over said rule which merely seeks to implement it. 37 It is
axiomatic that the clear letter of the law is controlling and cannot be amended by a mere
administrative rule issued for its implementation. Besides, what the discrepancy seems to indicate
is a mere oversight in the wording of the implementing rules, since Article 32, Rule VI thereof, also
requires that, in exercising the power of eminent domain, the chief executive of the LGU act
pursuant to an ordinance.

In this ruling, the Court does not diminish the policy embodied in Section 2, Article X of the
Constitution, which provides that "territorial and political subdivisions shall enjoy local autonomy."
It merely upholds the law as worded in RA 7160. We stress that an LGU is created by law and all its
powers and rights are sourced therefrom. It has therefore no power to amend or act beyond the
authority given and the limitations imposed on it by law. Strictly speaking, the power of eminent
domain delegated to an LGU is in reality not eminent but "inferior" domain, since it must conform
to the limits imposed by the delegation, and thus partakes only of a share in eminent
domain. 38 Indeed, "the national legislature is still the principal of the local government units, which
cannot defy its will or modify or violate it." 39

Complaint Does Not

State a Cause of Action

In its Brief filed before Respondent Court, petitioner argues that its Sangguniang Bayan passed an
ordinance on October 11, 1994 which reiterated its Resolution No. 93-35, Series of 1993, and ratified
all the acts of its mayor regarding the subject expropriation. 40

This argument is bereft of merit. In the first place, petitioner merely alleged the existence of such
an ordinance, but it did not present any certified true copy thereof. In the second place, petitioner
did not raise this point before this Court. In fact, it was mentioned by private respondent, and only
in passing. 41 In any event, this allegation does not cure the inherent defect of petitioner's Complaint
for expropriation filed on September 23, 1993. It is hornbook doctrine that

. . . in a motion to dismiss based on the ground that the complaint fails to state a
cause of action, the question submitted before the court for determination is the
sufficiency of the allegations in the complaint itself. Whether those allegations are
true or not is beside the point, for their truth is hypothetically admitted by the motion.
The issue rather is: admitting them to be true, may the court render a valid judgment
in accordance with the prayer of the complaint? 42

The fact that there is no cause of action is evident from the face of the Complaint for expropriation
which was based on a mere resolution. The absence of an ordinance authorizing the same is
equivalent to lack of cause of action. Consequently, the Court of Appeals committed no reversible
error in affirming the trial court's Decision which dismissed the expropriation suit.

Second Issue:

Eminent Domain Not Barred by Res Judicata

As correctly found by the Court of Appeals 43 and the trial court, 44 all the requisites for the
application of res judicata are present in this case. There is a previous final judgment on the merits
in a prior expropriation case involving identical interests, subject matter and cause of action, which
has been rendered by a court having jurisdiction over it.

Be that as it may, the Court holds that the principle of res judicata, which finds application in
generally all cases and proceedings, 45 cannot bar the right of the State or its agent to expropriate
private property. The very nature of eminent domain, as an inherent power of the State, dictates that
the right to exercise the power be absolute and unfettered even by a prior judgment or res judicata.
The scope of eminent domain is plenary and, like police power, can "reach every form of property
which the State might need for public use." 46 "All separate interests of individuals in property are
held of the government under this tacit agreement or implied reservation. Notwithstanding the grant
to individuals, the eminent domain, the highest and most exact idea of property, remains in the
government, or in the aggregate body of the people in their sovereign capacity; and they have the
right to resume the possession of the property whenever the public interest requires it." 47 Thus,
the State or its authorized agent cannot be forever barred from exercising said right by reason alone
of previous non-compliance with any legal requirement.

While the principle of res judicata does not denigrate the right of the State to exercise eminent
domain, it does apply to specific issues decided in a previous case. For example, a final judgment
dismissing an expropriation suit on the ground that there was no prior offer precludes another suit
raising the same issue; it cannot, however, bar the State or its agent from thereafter complying with
this requirement, as prescribed by law, and subsequently exercising its power of eminent domain
over the same property. 48 By the same token, our ruling that petitioner cannot exercise its
delegated power of eminent domain through a mere resolution will not bar it from reinstituting
similar proceedings, once the said legal requirement and, for that matter, all others are properly
complied with. Parenthetically and by parity of reasoning, the same is also true of the principle of
"law of the case." In Republic vs. De Knecht, 49 the Court ruled that the power of the State or its
agent to exercise eminent domain is not diminished by the mere fact that a prior final judgment over
the property to be expropriated has become the law of the case as to the parties. The State or its
authorized agent may still subsequently exercise its right to expropriate the same property, once
all legal requirements are complied with. To rule otherwise will not only improperly diminish the
power of eminent domain, but also clearly defeat social justice.

WHEREFORE, the petition is hereby DENIED without prejudice to petitioner's proper exercise of its
power of eminent domain over subject property. Costs against petitioner.

SO ORDERED.
 THIRD DIVISION

[G.R. No. 138896. June 20, 2000]

BARANGAY SAN ROQUE, TALISAY, CEBU, petitioner, vs. Heirs of FRANCISCO PASTOR, namely:
EUGENIO SYLIANCO, TEODORO SYLIANCO, ISABEL SYLIANCO, EUGENIA S. ONG, LAWRENCE
SYLIANCO, LAWSON SYLIANCO, LAWINA S. NOTARIO, LEONARDO SYLIANCO JR. and
LAWFORD SYLIANCO, respondents.

DECISION

PANGANIBAN, J.:

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

The Case

Before us is a Petition for Review on Certiorari assailing the March 29, 1999 Order[1] of the Regional Trial
Court (RTC) of Cebu City (Branch 58) in Civil Case No. CEB-21978, in which it dismissed a Complaint for
eminent domain. It ruled as follows:

"Premises considered, the motion to dismiss is hereby granted on the ground that this
Court has no jurisdiction over the case. Accordingly, the Orders dated February 19, 1999
and February 26, 1999, as well as the Writ of Possession issued by virtue of the latter
Order are hereby recalled for being without force and effect."[2]

Petitioner also challenges the May 14, 1999 Order of the RTC denying reconsideration.

The Facts

Petitioner filed before the Municipal Trial Court (MTC) of Talisay, Cebu (Branch 1) [3] a Complaint to
expropriate a property of the respondents. In an Order dated April 8, 1997, the MTC dismissed the
Complaint on the ground of lack of jurisdiction. It reasoned that "[e]minent domain is an exercise of the
power to take private property for public use after payment of just compensation. In an action for eminent
domain, therefore, the principal cause of action is the exercise of such power or right. The fact that the
action also involves real property is merely incidental. An action for eminent domain is therefore within the
exclusive original jurisdiction of the Regional Trial Court and not with this Court." [4]

Assailed RTC Ruling

The RTC also dismissed the Complaint when filed before it, holding that an action for eminent domain
affected title to real property; hence, the value of the property to be expropriated would determine whether
the case should be filed before the MTC or the RTC. Concluding that the action should have been filed
before the MTC since the value of the subject property was less than P20,000, the RTC ratiocinated in this
wise:
 "The instant action is for eminent domain. It appears from the current Tax Declaration of
the land involved that its assessed value is only One Thousand Seven Hundred Forty
Pesos (P1,740.00). Pursuant to Section 3, paragraph (3), of Republic Act No. 7691, all civil
actions involving title to, or possession of, real property with an assessed value of less
than P20,000.00 are within the exclusive original jurisdiction of the Municipal Trial Courts.
In the case at bar, it is within the exclusive original jurisdiction of the Municipal Trial Court
of Talisay, Cebu, where the property involved is located.

"The instant action for eminent domain or condemnation of real property is a real action
affecting title to or possession of real property, hence, it is the assessed value of the
property involved which determines the jurisdiction of the court. That the right of eminent
domain or condemnation of real property is included in a real action affecting title to or
possession of real property, is pronounced by retired Justice Jose Y. Feria, thus, Real
actions are those affecting title to or possession of real property. These include partition or
condemnation of, or foreclosures of mortgage on, real property. x x x"[5]

Aggrieved, petitioner appealed directly to this Court, raising a pure question of law. [6] In a Resolution dated
July 28, 1999, the Court denied the Petition for Review "for being posted out of time on July 2, 1999, the
due date being June 2, 1999, as the motion for extension of time to file petition was denied in the resolution
of July 14, 1999."[7] In a subsequent Resolution dated October 6, 1999, the Court reinstated the Petition. [8]

Respondents, on the other hand, contend that the Complaint for Eminent Domain affects the title to or
possession of real property. Thus, they argue that the case should have been brought before the MTC,
pursuant to BP 129 as amended by Section 3 (3) of RA 7691. This law provides that MTCs shall have
exclusive original jurisdiction over all civil actions that involve title to or possession of real property, the
assessed value of which does not exceed twenty thousand pesos or, in civil actions in Metro Manila, fifty
thousand pesos exclusive of interest, damages of whatever kind, attorneys fees, litigation expenses and
costs.

We agree with the petitioner that an expropriation suit is incapable of pecuniary estimation. The test to
determine whether it is so was laid down by the Court in this wise:

"A review of the jurisprudence of this Court indicates that in determining whether an action
is one the subject matter of which is not capable of pecuniary estimation, this Court has
adopted the criterion of first ascertaining the nature of the principal action or remedy
sought. If it is primarily for the recovery of a sum of money, the claim is considered capable
of pecuniary estimation, and whether jurisdiction is in the municipal courts or in the courts
of first instance would depend on the amount of the claim. However, where the basic issue
is something other than the right to recover a sum of money, or where the money claim is
purely incidental to, or a consequence of, the principal relief sought, like in suits to have
the defendant perform his part of the contract (specific performance) and in actions for
support, or for annulment of a judgment or to foreclose a mortgage, this Court has
considered such actions as cases where the subject of the litigation may not be estimated
in terms of money, and are cognizable exclusively by courts of first instance. The rationale
of the rule is plainly that the second class cases, besides the determination of damages,
demand an inquiry into other factors which the law has deemed to be more within the
competence of courts of first instance, which were the lowest courts of record at the time
that the first organic laws of the Judiciary were enacted allocating jurisdiction (Act 136 of
the Philippine Commission of June 11, 1901)."10

In the present case, 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 private property for public
use.11 In National Power Corporation v. Jocson,12 the Court ruled that expropriation proceedings have two
phases:
 "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. 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. 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. 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 filed or heard.

"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. 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. x x x"

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.13 In the main, the subject of an expropriation suit is the governments 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,"14 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."15 The 1997 amendments to the Rules of Court were not intended
to change these jurisprudential precedents.

We are not persuaded by respondents argument that the present action involves the title to or possession
of a parcel of land. They cite the observation of retired Justice Jose Y. Feria, an eminent authority in
remedial law, that condemnation or expropriation proceedings are examples of real actions that affect the
title to or possession of a parcel of land.16

Their reliance is misplaced. Justice Feria sought merely to distinguish between real and personal actions.
His discussion on this point pertained to the nature of actions, not to the jurisdiction of courts. In fact, in his
pre-bar lectures, he emphasizes that jurisdiction over eminent domain cases is still within the RTCs under
the 1997 Rules.

To emphasize, the question in the present suit is whether the government may expropriate private property
under the given set of circumstances. The government does not dispute respondents title to or possession
of the same. Indeed, it is not a question of who has a better title or right, for the government does not even
claim that it has a title to the property. It merely asserts its inherent sovereign power to "appropriate and
control individual property for the public benefit, as the public necessity, convenience or welfare may
demand."17
WHEREFORE, the Petition is hereby GRANTED and the assailed Orders SET ASIDE. The Regional Trial
Court is directed to HEAR the case. No costs.

SO ORDERED.

Melo, (Chairman), Purisima, and Gonzaga-Reyes, JJ., concur.

Vitug, J., on official business abroad.

NATIONAL POWER CORPORATION, petitioner,
vs.
SPS. MISERICORDIA GUTIERREZ and RICARDO MALIT and THE HONORABLE COURT OF
APPEALS,respondents.

Pedro S. Dabu for private respondents.

BIDIN, J.:

This is a petition for review on certiorari filed by the National Power Corporation (NPC) seeking the reversal
or modification of the March 9, 1986 Decision of the Court of Appeals in CA G.R. No. 54291-R entitled
"National Power Corporation v. Sps. Misericordia Gutierrez and Ricardo Malit", affirming the December 4,
1972 Decision of the then Court of First Instance of Pampanga, Fifth Judicial District, Branch II, in Civil
Case No. 2709, entitled National Power Corporation v. Matias Cruz, et al.

The undisputed facts of the case, as found by the Court of Appeals, are as follows:

Plaintiff National Power Corporation, a government owned and controlled entity, in accordance with
Commonwealth Act No. 120, is invested with the power of eminent domain for the purpose of
pursuing its objectives, which among others is the construction, operation, and maintenance of
electric transmission lines for distribution throughout the Philippines. For the construction of its 230
KV Mexico-Limay transmission lines, plaintiff's lines have to pass the lands belonging to defendants
Matias Cruz, Heirs of Natalia Paule and spouses Misericordia Gutierrez and Ricardo Malit covered
by tax declarations Nos. 907, 4281 and 7582, respectively.

Plaintiff initiated negotiations for the acquisition of right of way easements over the aforementioned
lots for the construction of its transmission lines but unsuccessful in this regard, said corporation
was constrained to file eminent domain proceedings against the herein defendants on January 20,
1965.

Upon filing of the corresponding complaint, plaintiff corporation deposited the amount of P973.00
with the Provincial Treasurer of Pampanga, tendered to cover the provisional value of the land of
the defendant spouses Ricardo Malit and Misericordia Gutierrez. And by virtue of which, the plaintiff
corporation was placed in possession of the property of the defendant spouses so it could
immediately proceed with the construction of its Mexico-Limay 230 KV transmission line. In this
connection, by the trial court's order of September 30, 1965, the defendant spouses were
authorized to withdraw the fixed provisional value of their land in the sum of P973.00.

The only controversy existing between the parties litigants is the reasonableness and adequacy of
the disturbance or compensation fee of the expropriated properties.

Meanwhile, for the purpose of determining the fair and just compensation due the defendants, the
court appointed three commissioners, comprised of one representative of the plaintiff, one for the
defendants and the other from the court, who then were empowered to receive evidence, conduct
ocular inspection of the premises, and thereafter, prepare their appraisals as to the fair and just
compensation to be paid to the owners of the lots. Hearings were consequently held before said
commissioners and during their hearings, the case of defendant Heirs of Natalia Paule was
amicably settled by virtue of a Right of Way Grant (Exh. C) executed by Guadalupe Sangalang for
herself and in behalf of her co-heirs in favor of the plaintiff corporation. The case against Matias
Cruz was earlier decided by the court, thereby leaving only the case against the defendant spouses
Ricardo Malit and Misericordia Gutierrez still to be resolved. Accordingly, the commissioners
submitted their individual reports. The commissioner for the plaintiff corporation recommended the
following:

. . . that plaintiff be granted right of way easement over the 760 square meters of the
defendants Malit and Gutierrez land for plaintiff transmission line upon payment of an
easement fee of P1.00 therefor. . . . (Annex M)

The commissioner for the defendant spouses recommended the following:

. . . that Mr. and Mrs. Ricardo Malit be paid as disturbance compensation the amount of
P10.00 sq. meter or the total amount of P7,600.00' (Annex K)

The Court's commissioner recommended the following:

. . . the payment of Five (P 5.OO) Pesos per square meter of the area covered by the Right-
of-way to be granted, . . .(Annex L)

The plaintiff corporation urged the Court that the assessment as recommended by their
commissioner be the one adopted. Defendant spouses, however, dissented and objected
to the price recommended by both the representative of the court and of the plaintiff
corporation.

With these reports submitted by the three commissioners and on the evidence adduced by
the defendants as well as the plaintiff for the purpose of proving the fair market value of
the property sought to be expropriated, the lower court rendered a decision the dispositive
portion of which reads as follows:

WHEREFORE, responsive to the foregoing considerations, judgment is hereby

rendered ordering plaintiff National Power Corporation to pay defendant spouses
Ricardo Malit and Misericordia Gutierrez the sum of P10.00 per square meter as
the fair and reasonable compensation for the right-of-way easement of the affected
area, which is 760 squares, or a total sum of P7,600.00 and P800.00 as attorney's
fees' (Record on Appeal, p. 83)

Dissatisfied with the decision, the plaintiff corporation filed a motion for reconsideration
which was favorably acted upon by the lower court, and in an order dated June 10, 1973,
it amended its previous decision in the following tenor:

On the basis of an ocular inspection made personally by the undersigned, this

court finally classified the land of the spouses Ricardo Malit and Misericordia to be
partly commercial and partly agricultural, for which reason the amount of P10.00
per sq. meter awarded in the decision of December 4,1972 is hereby reduced to
P5.00 per square meter as the fair and reasonable market value of the 760 square
meters belonging to the said spouses.

There being no claim and evidence for attorney's fees, the amount of P800.00
awarded as attorney's fees, in the decision of December 4, 1972 is hereby
reconsidered and set aside. (Annex S)

Still not satisfied, an appeal was filed by petitioner (NPC) with the Court of Appeals but
respondent Court of Appeals in its March 9, 1982, sustained the trial court, as follows:
 WHEREFORE, finding no reversible error committed by the court a quo, the
appealed judgment is hereby affirmed with costs against the plaintiff-appellant.

Hence, the instant petition.

The First Division of this Court gave due course to the petition and required both parties to submit their
respective memoranda (Resolution of January 12, 1983). It also noted in an internal resolution of August
17, 1983 that petitioner flied its memorandum while the respondents failed to file their memorandum within
the period which expired on February 24,1983; hence, the case was considered submitted for decision.

The sole issue raised by petitioner is

WHETHER PETITIONER SHOULD BE MADE TO PAY SIMPLE EASEMENT FEE OR FULL

COMPENSATION FOR THE LAND TRAVERSED BY ITS TRANSMISSION LINES.

It is the contention of petitioner that the Court of Appeals committed gross error by adjudging the petitioner
liable for the payment of the full market value of the land traversed by its transmission lines, and that it
overlooks the undeniable fact that a simple right-of-way easement (for the passage of transmission lines)
transmits no rights, except that of the easement. Full ownership is retained by the private respondents and
they are not totally deprived of the use of the land. They can continue planting the same agricultural crops,
except those that would result in contact with the wires. On this premise, petitioner submits that if full market
value is required, then full transfer of ownership is only the logical equivalent.

The petition is devoid of merit. The resolution of this case hinges on the determination of whether the
acquisition of a mere right-of-way is an exercise of the power of eminent domain contemplated by
law.1wphi1

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

The foregoing facts considered, the acquisition of the right-of-way easement falls within the purview of the
power of eminent domain. Such conclusion finds support in similar cases of easement of right-of-way where
the Supreme Court sustained the award of just compensation for private property condemned for public
use (See National Power Corporation vs. Court of Appeals, 129 SCRA 665, 1984; Garcia vs. Court of
Appeals, 102 SCRA 597,1981). The Supreme Court, in Republic of the Philippines vs. PLDT, * thus held
that:

Normally, of course, the power of eminent domain results in the taking or appropriation of title to,
and possession of, the expropriated property; but no cogent reason appears why said power may
not be availed of to impose only a burden upon the owner of condemned property, without loss of
title and possession. It is unquestionable that real property may, through expropriation, be
subjected to an easement of right-of-way.

In the case at bar, the easement of right-of-way is definitely a taking under the power of eminent domain.
Considering the nature and effect of the installation of the 230 KV Mexico-Limay transmission lines, the
limitation imposed by NPC against the use of the land for an indefinite period deprives private respondents
of its ordinary use.
For these reasons, the owner of the property expropriated is entitled to a just compensation, which should
be neither more nor less, whenever it is possible to make the assessment, than the money equivalent of
said property. Just compensation has always been understood to be the just and complete equivalent of
the loss which the owner of the thing expropriated has to suffer by reason of the expropriation (Province of
Tayabas vs. Perez, 66 Phil. 467 [1938]; Assoc. of Small Land Owners of the Phils., Inc. vs. Secretary of
Agrarian Reform, G.R. No. 78742; Acuna vs. Arroyo, G.R. No. 79310; Pabrico vs. Juico, G.R. No. 79744;
Manaay v. Juico, G.R. No. 79777,14 July 1989, 175 SCRA 343 [1989]). The price or value of the land and
its character at the time it was taken by the Government are the criteria for determining just compensation
(National Power Corp. v. Court of Appeals, 129 SCRA 665, [1984]). The above price refers to the market
value of the land which may be the full market value thereof. According to private respondents, the market
value of their lot is P50.00 per square meter because the said lot is adjacent to the National and super
highways of Gapan, Nueva Ecija and Olongapo City.

Private respondents recognize the inherent power of eminent domain being exercised by NPC when it
finally consented to the expropriation of the said portion of their land, subject however to payment of just
compensation. No matter how laudable NPC's purpose is, for which expropriation was sought, it is just and
equitable that they be compensated the fair and full equivalent for the loss sustained, which is the measure
of the indemnity, not whatever gain would accrue to the expropriating entity (EPZA v. Dulay, 149 SCRA
305 [1987]; Mun. of Daet v. Court of Appeals, 93 SCRA 503 (1979]).

It appearing that the trial court did not act capriciously and arbitrarily in setting the price of P5.00 per square
meter of the affected property, the said award is proper and not unreasonable.

On the issue of ownership being claimed by petitioner in the event that the price of P5.00 per square meter
be sustained, it is well settled that an issue which has not been raised in the Court a quo cannot be raised
for the first time on appeal as it would be offensive to the basic rules of fair play, justice and due process .
. . (Filipino Merchants v. Court of Appeals, G.R. No. 85141, November 8, 1989, 179 SCRA 638;
Commissioner of Internal Revenue v. Procter and Gamble Philippines Manufacturing Corporation, 160
SCRA 560 [1988]; Commissioner of Internal Revenue v. Wander Philippines, Inc., 160 SCRA 573 1988]).
Petitioner only sought an easement of right-of-way, and as earlier discussed, the power of eminent domain
may be exercised although title was not transferred to the expropriator.

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

SO ORDERED.
FILSTREAM INTERNATIONAL INCORPORATED, petitioner, vs., COURT OF APPEALS, ORLANDO
MALIT, ANTONIO CAGUIAT, ALICIA CABRERA, ARMANDO LACHICA, JACINTO CAGUIAT, GLORIA
ANTONIO, ELIZALDE NAVARRA, DOLORES FUENTES, SUSANA ROY, ANTONIO IBANEZ, BENIGNO
BASILIO, LUCERIA DEMATULAC, FLORENCIA GOMEZ, LAZARO GOMEZ, JOSE GOMEZ,
VENANCIO MANALOTO, CRISTINO UMALI, DEMETRIA GATUS, PRISCILLA MALONG, DOMINGO
AGUILA, RAMON SAN AGUSTIN, JULIAN FERRER, JR., FRANCISCO GALANG, FLORENTINO
MALIWAT, SEVERINA VILLAR, TRINIDAD NAGUIT, JOSE NAGUIT, FORTUNATO AGUSTIN
CABRERA, GAUDENCIO INTAL, DANILO DAVID, ENRIQUE DAVID, VICENTE DE GUZMAN,
POLICARPIO LUMBA, BELEN PALMA, ELEN SOMVILLO, LEONARDO MANICAD, OPRENG MICLAT,
BENITA MATA, GREGORIO LOPEZ, MARCELINA SAPNO, JESUS MERCADO, and CALIXTO
GOMEZ, respondent.

DECISION
FRANCISCO, J.:

In resolving the instant petitions, the Court is tasked to strike a balance between the contending
interests when the state exercised its power of eminent domain. On one side we have the owners of the
property to be expropriated who must be duly compensated for the loss of their property, while on the other
is the State which must take the property for public use.
Petitioner, Filstream International Inc., is the registered owner of the properties subject of this dispute
consisting of adjacent parcels of land situated in Antonio Rivera Street, Tondo II, Manila, with a total area
of 3,571.10 square meters and covered by T.C.T. Nos. 203937, 203936, 169198, 169199, 169200 and
169202 of the Register of Deeds of Manila.
On January 7, 1993, petitioner filed an ejectment suit before the Metropolitan Trial Court of Manila
(Branch 15) docketed as Civil Case No. 140817-CV against the occupants of the abovementioned parcels
of land (herein private respondents in G.R. No. 128077) on the grounds of termination of the lease contract
and non-payment of rentals. Judgment was rendered by the MTC on September 14, 1993 ordering private
respondents to vacate the premises and pay back rentals to petitioner.[1]
Not satisfied, private respondents appealed the decision to the Regional Trial Court of Manila, Branch
4 (Civil Case No. 93-68130) which in turn affirmed the decision of the MTC in its decision dated February
22, 1994. Still not content, private respondents proceeded to the Court of Appeals via a petition for review
(CA-G.R. SP No. 33714). The result however remained the same as the CA affirmed the decision of the
RTC in its decision dated August 25, 1994.[2]
Thereafter, no further action was taken by the private respondents, as a result of which the decision
in the ejectment suit became final and executory.
However, it appeared that during the pendency of the ejectment proceedings private respondents filed
on May 25, 1993, a complaint for Annulment of Deed of Exchange against petitioner Filstream which was
docketed in Civil Case No. 93-66059 before the RTC of Manila, Branch 43. It was at this stage that
respondent City of Manila came into the picture when the city government approved Ordinance No.
7813[3] on November 5, 1993, authorizing Mayor Alfredo S. Lim to initiate the acquisition by negotiation,
expropriation, purchase, or other legal means certain parcels of land registered under T.C.T. Nos. 169193,
169198, 169190, 169200, 169202, and 169192 of the Registry of Deeds of Manila which formed part of the
properties of petitioner then occupied by private respondents. Subsequently, the City of Manila approved
Ordinance No. 7855[4] declaring the expropriation of certain parcels of land situated along Antonio Rivera
and Fernando Ma. Guerero streets in Tondo, Manila which were owned by Mr. Enrique Quijano Gutierez,
petitioners predecessor-in-interest. The said properties were to be sold and distributed to qualified tenants
of the area pursuant to the Land Use Development Program of the City of Manila.
On May 23, 1994, respondent City of Manila filed a complaint for eminent domain (Civil Case No. 94-
70560) before the RTC of Manila, Branch 42,[5] seeking to expropriate the aforecited parcels of land owned
by petitioner Filstream which are situated at Antonio Rivera Street, Tondo II, Manila. [6]
 Pursuant to the complaint filed by respondent City of Manila,the trial court issued a Writ of
Possession[7] in favor of the former which ordered the transfer of possession over the disputed premises to
the City of Manila.
At this juncture, petitioner Filstream filed a motion to dismiss the complaint for eminent domain as well
as a motion to quash the writ of possession. The motion to dismiss was premised on the following
grounds: no valid cause of action; the petition does not satisfy the requirements of public use and a mere
clandestine maneuver to circumvent the writ execution issued by the RTC of Manila, Branch 4 in the
ejectment suit; violation of the constitutional guarantee against non-impairment of obligation and contract;
price offered was too low hence violative of the just compensation provision of the constitution and the said
amount is without the certification of the City Treasurer for availability of funds.[8] With respect to the motion
to quash the writ of possession, petitioner raised the following objections: failure to comply with Section 2
of Rule 67 of the Rules of Court, Ordinance No. 7813 is a void enactment for it was approved without a
public hearing and violative of the constitutional guarantee against impairment of obligation and contracts;
the price is too low and unconscionable violating the just compensation provision of the constitution, and
the said writ is tainted with infirmity considering the absence of a certification from the City of Manila that
there is an immediately available fund for the subject expropriation. [9]
Respondent City of Manila filed its opposition[10] to petitioner Filstreams two motion and to which
petitioner accordingly filed a reply.[11] On September 30, 1994, the RTC of Manila, Branch 42, issued an
order denying petitioner Filstreams motion to dismiss and the motion to quash the Writ of Possession and
declared as follows:

IN FINE, the defendants motion to dismiss and motion to quash writ of possession are both without merit
and are hereby DENIED and the subject parcels of lands covered by TCT Nos. 203937, 203936, 169198,
169199, 169200, and 169202 (of the Register of Deeds of Manila) located at Antonio Rivera Street, Tondo
II, Manila with a total area of 3,571.10 square meters are hereby declared CONDEMNED in favor of the
City of Manila for distribution and resale to all poor and landless qualified residents/tenants in the said area
under the citys land-for-the-landless program upon payment of just compensation which is yet to be
determined by this Court.[12]

Petitioner filed a motion for reconsideration[13] as well as a supplemental motion for

reconsideration[14] seeking the reversal of the above-quoted order but the same were denied.[15] Still,
petitioner filed a subsequent motion to be allowed to file a second motion for reconsideration but it was also
denied.
Aggrieved, petitioner filed on March 31, 1996, a Petition for Certiorari with the Court of Appeals (CA-
G.R. SP No. 36904) seeking to set aside the September 30, 1994 order of the RTC of Manila, Branch
42. However, on March 18, 1996, respondent CA issued a resolution dismissing the petition in this wise:

It appearing that the above-entitled petition is insufficient in form and substance -- it does not comply with
Section 2(a), Rule 6 of the Revised Internal Rules of the Court of Appeals which requires that the petition
shall be x x x accompanied by x x x other pertinent documents and papers, aside from the fact that copies
of the pleadings attached to the petition are blurred and unreadable -- this Court resolved to summarily
DISMISS the same (petition).[16]

Petitioner filed a motion for reconsideration and attached clearer copies of the pertinent documents
and papers pursuant to Section 2(a) Rule 6 of the Revised Internal Rules of the Court of Appeals. But on
May 20, 1996, respondent CA issued a resolution denying the motion as petitioner failed to submit clearer
and readable copies of the pleadings.[17] This prompted petitioner to proceed to this Court giving rise to the
instant petition for review on certiorari under Rule 45 and docketed herein as G.R. No. 125218, assailing
the dismissal of its petition by the CA in its resolution dated March 18, 1996 as well as that of its motion for
reconsideration in the resolution dated May 20, 1996.
Meanwhile, owing to the finality of the decision in the ejectment suit (Civil Case No 140817 CV), the
MTC of Manila, Branch 15, upon motion of petitioner Filstream, issued a Writ of Execution as well as a
Notice to Vacate the disputed premises.[18] Private respondents filed a Motion to Recall/Quash the Writ of
Execution and Notice to Vacate[19] alleging the existence of a supervening event in that the properties
subject of the dispute have already been ordered condemned in an expropriation proceeding in favor of the
City of Manila for the benefit of the qualified occupants thereof, thus execution shall be stayed. Petitioner
opposed the motion, reiterating that the decision in the ejectment case is already final and executory and
disputed private respondents right to interpose the expropriation proceedings as a defense because the
latter were not parties to the same.
For its part, the City of Manila filed on March 13, 1996, a motion for intervention with prayer to
stay/quash the writ of execution on the ground that it is the present possessor of the property subject of
execution.
In its order dated March 14, 1996, the MTC of Manila, Branch 14, denied private respondents motion
as it found the allegations therein bereft of merit and upheld the issuance of the Writ of Execution and
Notice to Vacate in petitioners favor.[20] Subsequently, the trial court also denied the motion filed by the City
of Manila.
On April 22, 1996, the trial court issued an order commanding the demolition of the structure erected
on the disputed premises. To avert the demolition, private respondents filed before the RTC of Manila,
Branch 14, a Petition for Certiorari and Prohibition with prayer for the issuance of a temporary restraining
order and preliminary injunction (docketed as Civil Case No. 96-78098). On April 29, 1996, the RTC of
Manila, Branch 33, issued a TRO enjoining the execution if the writ issued in Civil Case No. 140817-CV by
the MTC of Manila, Branch 14.[21]Subsequently, the RTC issued a writ of preliminary injunction on May 14,
1996.[22]
On May 15, 1996, the City of Manila filed its Petition for Certiorari and Prohibition with prayer for the
issuance of a temporary restraining order and preliminary injunction which was raffled to Branch 23 of the
RTC of Manila (docketed as Civil Case No. 96-78382), seeking the reversal of the orders issued by the
MTC of Manila, Branch 14, which denied its motion to intervene and quash the writ of execution in Civil
Case No. 140817-CV.
Thereafter, upon motion filed by the City of Manila, an order was issued by the RTC of Manila, Branch
10, ordering the consolidation of Civil Case No. 96-78382 with Civil Case No. 96-78098 pending before
Branch 14 of the RTC of Manila.[23] On May 21, 1996, the RTC of Manila, Branch 14, issued an injunction
in Civil Case No. 96-78098 enjoining the implementation of the writ of execution until further orders from
the court.[24] Petitioner Filstream filed a Motion to Dissolve the Writ of Preliminary Injunction and to be
allowed to post a counter-bond but the trial court denied the same. Filstream then filed a motion for
reconsideration from the order of denial but pending resolution of this motion for voluntary inhibition of the
presiding judge of the RTC of Manila, Branch 14. The motion for inhibition was granted[25] and as a result,
the consolidated cases (Civil Case No. 96-78382 and 96-78098) were re-raffled to the RTC of Manila,
Branch 33.
During the proceedings before the RTC of Manila, Branch 33, petitioner Filstream moved for the
dismissal of the consolidated cases (Civil Case No. 96-78382 and 96-78098) for violation of Supreme Court
Circular No. 04-94 (forum shopping) because the same parties, causes of action and subject matter
involved therein have already been disposed of in the decision in the ejectment case (Civil Case No.
140817) which has already become final and executory prior to the filing of these consolidated cases.
On December 9, 1996, an order was issued by the RTC of Manila, Branch 33, ordering the dismissal
of Civil Cases Nos. 96-78382 and 96-78098 for violation of Supreme Court Circular No. 04-
94.[26] Immediately thereafter, petitioner Filstream filed an Ex-parte Motion for Issuance of an Alias Writ of
Demolition and Ejectment and a supplemental motion to the same dated January 10 and 13, 1997,
respectively,[27] before the MTC of Manila, Branch 15, which promulgated the decision in the ejectment suit
(Civil Case No. 140817-CV). On January 23, 1997, the court granted the motion and issued the
corresponding writ of demolition.
As a consequence of the dismissal of the consolidated cases, herein private respondents filed a
Petition for Certiorari and Prohibition with prayer for the issuance of a temporary restraining order and
preliminary injunction before the Court of Appeals (docketed as CA-G.R. SP No. 43101)[28] assailing the
above-mentioned order of dismissal by the RTC of Manila, Branch 33, as having been issued with grave
abuse of discretion tantamount to lack or in excess of jurisdiction.
In a resolution dated January 28, 1997, the Court of Appeals granted herein private respondents prayer
for the issuance of a temporary restraining order and directed the MTC of Manila, Branch 15, to desist from
implementing the order of demolition dated January 23, 1997, unless otherwise directed.[29]
At the conclusion of the hearing for the issuance of a writ of preliminary injunction, the Court of Appeals,
in its resolution dated February 18, 1997, found merit in private respondents allegations in support of their
application of the issuance of the writ and granted the same, to wit:

Finding that the enforcement or implementation of the writ of execution and notice to vacate issued in Civil
Case No. 140817-CV, the ejectment case before respondent Judge Jiro, during the pendency of the instant
petition, would probably be in violation of petitioners right, and would tend to render the judgment in the
instant case ineffectual, and probably work injustice to the petitioners, the application for the issuance of a
writ of preliminary injunction is hereby GRANTED.

WHEREFORE, upon the filing of a bond in the amount of P150,000.00, let a writ of preliminary injunction
be issued enjoining respondents, their employees, agents, representatives and anyone acting in their
behalf from enforcing or executing the writ of execution and notice to vacate issued in Civil Case No.
140817-CV of the court of respondent Judge Jiro, or otherwise disturbing the status quo, until further orders
of this Court.[30]

In turn, petitioner Filstream is now before this Court via a Petition for Certiorari under Rule 65 (G.R.
No. 128077), seeking to nullify the Resolutions of the Court of Appeals dated January 28, 1997 and
February 18, 1997 which granted herein private respondents prayer for a TRO and Writ of Preliminary
Injunction, the same being null and void for having been issued in grave abuse of discretion.
Upon motion filed by petitioner Filstream, in order to avoid any conflicting decision on the legal issues
raised in the petitions, the Court ordered that the later petition, G.R. No. 128077 be consolidated with G.R.
No. 128077 in the resolution of March 5, 1997.[31]
The issue raised in G.R. No. 125218 is purely procedural and technical matter. Petitioner takes
exception to the resolutions of respondent CA dated March 18, 1996 and May 20, 1996 which ordered the
dismissal of its Petition for Certiorari for non-compliance with Sec. 2(a) of Rule 6 of the Revised Internal
Rules of the Court of Appeals by failing to attach to its petition other pertinent documents and papers and
for attaching copies of pleadings which are blurred and unreadable. Petitioner argues that respondent
appellate court seriously erred in giving more premium to form rather than the substance.
We agree with the petitioner. A strict adherence to the technical and procedural rules in this case would
defeat rather than meet the ends of justice as it would result in the violation of the substantial rights of
petitioner. At stake in the appeal filed by petitioner before the CA is the exercise of their property rights over
the disputed premises which have been expropriated and have in fact been ordered condemned in favor of
the City of Manila. In effect, the dismissal of their appeal in the expropriation proceedings based on the
aforementioned grounds is tantamount to a deprivation of property without due process of law as it would
automatically validate the expropriation proceedings based on the aforementioned grounds is tantamount
to a deprivation of property without due process of law as it would automatically validate the expropriation
proceedings which the petitioner is still disputing. It must be emphasized that where substantial rights are
affected, as in this case, the stringent application of procedural rules may be relaxed if only to meet the
ends of substantial justice.
In these instances, respondent CA can exercise its discretion to suspend its internal rules and allow
the parties to present and litigate their causes of action so that the Court can make an actual and complete
disposition of the issues presented in the case. Rather than simply dismissing the petition summarily for
non-compliance with respondent courts internal rules, respondent CA should have instead entertained
petitioner Filstreams petition for review on Certiorari, and ordered petitioner to submit the corresponding
pleadings which it deems relevant and replace those which are unreadable. This leniency could not have
caused any prejudiced to the rights of the other parties.
With regard to the other petition, G.R. No. 128077, petitioner Filstream objects to the issuance by
respondent CA of the restraining order and the preliminary injunction enjoining the execution of the writ of
demolition issued in the ejectment suit (Civil Case No. 140817-CV) as an incident to private respondents
pending petition assailing the dismissal by the RTC of Manila, Branch 33, of the consolidated petitions
for certiorari filed by private respondents and the City of Manila on the ground of forum shopping.
The propriety of the issuance of the restraining order and the writ of preliminary injunction is but a mere
incient to the actual controversy which is rooted in the assertion of the conflicting rights of the parties in this
case over the disputed premises. In order to determine whether private respondents are entitled to the
injunctive reliefs granted by respondent CA, we deemed it proper to extract the source of discord.
Petitioner Filstream anchors its claim by virtue of its ownership over the properties and the existence
of a final and executory judgment against private respondents ordering the latters ejectment from the
premises (Civil Case No. 140817-CV).
Private respondents claim on the other hand hinges on an alleged supervening event which has
rendered the enforcement of petitioners rights moot, that is, the expropriation proceedings (Civil Case No.
94-70560) undertaken by the City of Manila over the disputed premises for the benefit of herein private
respondents. For its part, the City of Manila is merely exercising its power of eminent domain within its
jurisdiction by expropriating petitioners properties for public use.
There is no dispute as to the existence of a final and executory judgment in favor of petitioner Filstream
ordering the ejectment of private respondents from the properties subject of this dispute. The judgment in
the ejectment suit became final and executory after private respondents failed to interpose any appeal from
the adverse decision of the Court of Appeals dated August 25, 1994 in CA-G.R. SP No. 33714. Thus,
petitioner has every right to assert the execution of this decision as it had already became final and
executory.
However, it must also be conceded that the City of Manila has an undeniable right to exercise its power
of eminent domain within its jurisdiction. The right to expropriate private property for public use is expressly
granted to it under Section 19 of the 1991 Local Government Code, to wit:

SECTION 19. Eminent Domain A local government unit may, through its chief executive and acting
pursuant to an ordinance, exercise the power of eminent domain for public use, or purpose, or welfare for
the benefit of the poor and the landless, upon payment of just compensation, pursuant to the provisions of
the Constitution and pertinent laws: 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 (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.
(Italics supplied)

More specifically, the City of Manila has the power to expropriate private property in the pursuit of its
urban land reform and housing program as explicitly laid out in the Revised Charter of the City of Manila
(R.A. No. 409) as follows:

General powers The city may have a common seal and alter the same at pleasure, and may take, purchase,
receive, hold, lease, convey, and dispose of real and personal property for the general interest of the city,
condemn private property for public use, contract and be contracted with, sue and be sued, and prosecute
and defend to final judgment and execution, and exercise all the powers hereinafter conferred. (R.A. 409,
Sec. 3; Italics supplied).
xxxxxxxxx

Sec. 100. The City of Manila is authorized to acquire private lands in the city and to subdivide the same
into home lots for sale on easy terms to city residents, giving first priority to the bona fide tenants or
occupants of said lands, and second priority to laborers and low-salaried employees. For the purpose of
this section, the city may raise necessary funds by appropriations of general funds, by securing loans or by
issuing bonds, and, if necessary, may acquire the lands through expropriation proceedings in accordance
with law, with the approval of the Presidentx x x. (Italics supplied).

In fact, the City of Manilas right to exercise these prerogatives notwithstanding the existence of a final
and executory judgment over the property to be expropriated has been upheld by this Court in the case of
Philippine Columbian Association vs. Panis, G.R. No. 106528, December 21, 1993. [32] Relying on the
aforementioned provisions of the Revised Charter of the City of Manila, the Court declared that:

The City of Manila, acting through its legislative branch, has the express power to acquire private lands in
the city and subdivide these lands into home lots for sale to bona-fide tenants or occupants thereof, and to
laborers and low-salaried employees of the city.

That only a few could actually benefit from the expropriation of the property does not diminish its public use
character. It is simply not possible to provide all at once land and shelter for all who need them (Sumulong
v. Guerrero, 154 SCRA 461 [1987]).

Corollary to the expanded notion of public use, expropriation is not anymore confined to vast tracts of land
and landed estates (Province of Camarines Sur v. Court of Appeals, G.R. Nol 103125, May 17, 1993; J. M.
Tuason and Co., Inc. v. Land Tenure Administration, 31 SCRA 413 [1970]). It is therefore of no moment
that the land sought to be expropriated in this case is less than the half a hectare only (Pulido v. Court of
Appeals, 122 SCRA 63 [1983]).

Through the years, the public use requirement in eminent domain has evolved into a flexible concept,
influenced by changing conditions (Sumulong v. Guerrero, supra; Manotok v. National Housing Authority,
150 SCRA 89 [1987]; Heirs of Juancho Ardona v. Reyes, 125 SCRA 220 [1983]). Public use now includes
the broader notion of indirect public benefit or advantage, including a particular, urban land reform and
housing.[33]

We take judicial notice of the fact that urban land reform has become a paramount task in view of the
acute shortage of decent housing in urban areas particularly in Metro Manila.Nevertheless, despite the
existence of a serious dilemma, local government units are not given an unbridled authority when exercising
their power of eminent domain in pursuit of solutions to these problems. The basic rules still have to be
followed, which are as follows: no person shall be deprived of life, liberty, or property without due process
of law, nor shall any person be denied the equal protection of the laws (Art. 3, Sec. 1, 1987 Constitution);
private property shall not be taken for public use without just compensation (Art. 3, Section 9, 1987
Constitution).Thus the exercise by local government units of the power of eminent domain is not without
limitations. Even Section 19 of the 1991 Local Government Code is very explicit that it must comply with
the provisions of the Constitution and pertinent laws, to wit:

SECTION 19. Eminent Domain. A local government unit may, through its chief executive and acting
pursuant to an ordinance, exercise the power of eminent domain for public use, or purpose, or welfare for
the benefit of the poor and the landless, upon payment of just compensation, pursuant to the provisions of
the Constitution and pertinent laws: x x x. (Italics supplied).

The governing law that deals with the subject of expropriation for purposed of urban land reform and
housing in Republic Act No. 7279 (Urban Development and Housing Act of 1992) and Sections 9 and 10
of which specifically provide as follows:
Sec. 9. Priorities in the acquisition of Land Lands for socialized housing shall be acquired in the following
order:

(a) Those owned by the Government or any of its sub-divisions, instrumentalities, or agencies, including
government-owned or controlled corporations and their subsidiaries;

(b) Alienable lands of the public domain;

(c) Unregistered or abandoned and idle lands;

(d) Those within the declared Areas of Priority Development, Zonal Improvement sites, and Slum
Improvement and Resettlement Program sites which have not yet been acquired;

(e) Bagong Lipunan Improvement sites and Services or BLISS sites which have not yet been acquired; and

(f) Privately-owned lands.

Where on-site development is found more practicable and advantageous to the beneficiaries, the priorities
mentioned in this section shall not apply. The local government units shall give budgetary priority to on-site
development of government lands.

Sec. 10. Modes of Land Acquisition. The modes of acquiring lands for purposes of this Act shall include,
among others, community mortgage, land swapping, land assembly or consolidation, land banking,
donation to the Government, joint venture agreement, negotiated purchase, and expropriation: Provided,
however, That expropriation shall be resorted to only when other modes of acquisition have been
exhausted: Provided further, That where expropriation is resorted to, parcels of land owned by small
property owners shall be exempted for purposes of this Act: Provided, finally, That abandoned property, as
herein defined, shall be reverted and escheated to the State in a proceeding analogous to the procedure
laid down in Rule 91 of the Rules of Court.

For the purpose of socialized housing, government-owned and foreclosed properties shall be acquired by
the local government units, or by the National Housing Authority primarily through negotiated
purchase: Provided, That qualified beneficiaries who are actual occupants of the land shall be given the
right of first refusal. (Italics supplied).

Very clear from the abovequoted provisions are the limitations with respect to the order of priority in
acquiring private lands and in resorting to expropriation proceedings as means to acquire the same. Private
lands rank last in the order of priority for purposes of socialized housing. In the same vein, expropriation
proceedings are to be resorted to only when the other modes of acquisition have been
exhausted. Compliance with these conditions must be deemed mandatory because these are the only
safeguards in securing the right of owners of private property to due process when their property is
expropriated for public use.
Proceeding from the parameters laid out in the above disquisitions, we now pose the crucial
question: Did the city of Manila comply with the abovementioned conditions when it expropriated petitioner
Filstreams properties? We have carefully scrutinized the records of this case and found nothing that would
indicate the respondent City of Manila complied with Sec. 9 and Sec. 10 of R.A. 7279. Petitioners Filstreams
properties were expropriated and ordered condemned in favor of the City of Manila sans any showing that
resort to the acquisition of other lands listed under Sec. 9 of RA 7279 have proved futile. Evidently, there
was a violation of petitioner Filstreams right to due process which must accordingly be rectified.
Indeed, it must be emphasized that the State has a paramount interest in exercising its power of
eminent domain for the general good considering that the right of the State to expropriate private property
as long as it is for public use always takes precedence over the interest of private property owners. However
we must not lose sight of the fact that the individual rights affected by the exercise of such right are also
entitled to protection, bearing in mind that the exercise of this superior right cannot override the guarantee
of due process extended by the law to owners of the property to be expropriated. In this regard, vigilance
over compliance with the due process requirements is in order.
WHEREFORE, the petitions are hereby GRANTED. In G.R. 125218, the resolutions of the Court of
Appeals in CA-G.R. SP No. 36904 dated March 18, 1996 and May 20, 1996 are hereby REVERSED and
SET ASIDE. In G.R. No. 128077, the resolution of the Court of Appeals in CA-G.R. SP No. 43101 dated
January 28, 1997 and February 18, 1997 are REVERSED and SET ASIDE.
SO ORDERED.
DIOSDADO LAGCAO, DOROTEO LAGCAO and URSULA LAGCAO, petitioners,
vs.
JUDGE GENEROSA G. LABRA, Branch 23, Regional Trial Court, Cebu, and the CITY OF
CEBU, respondent.

DECISION

CORONA, J.:

Before us is a petition for review of the decision dated July 1, 2002 of the Regional Trial Court, Branch 23,
Cebu City1 upholding the validity of the City of Cebus Ordinance No. 1843, as well as the lower courts
order dated August 26, 2002 denying petitioners motion for reconsideration.

In 1964, the Province of Cebu donated 210 lots to the City of Cebu. One of these lots was Lot 1029, situated
in Capitol Hills, Cebu City, with an area of 4,048 square meters. In 1965, petitioners purchased Lot 1029
on installment basis. But then, in late 1965, the 210 lots, including Lot 1029, reverted to the Province of
Cebu.2 Consequently, the province tried to annul the sale of Lot 1029 by the City of Cebu to the petitioners.
This prompted the latter to sue the province for specific performance and damages in the then Court of
First Instance.

On July 9, 1986, the court a quo ruled in favor of petitioners and ordered the Province of Cebu to execute
the final deed of sale in favor of petitioners. On June 11, 1992, the Court of Appeals affirmed the decision
of the trial court. Pursuant to the ruling of the appellate court, the Province of Cebu executed on June 17,
1994 a deed of absolute sale over Lot 1029 in favor of petitioners. Thereafter, Transfer Certificate of Title
(TCT) No. 129306 was issued in the name of petitioners and Crispina Lagcao. 3

After acquiring title, petitioners tried to take possession of the lot only to discover that it was already
occupied by squatters. Thus, on June 15, 1997, petitioners instituted ejectment proceedings against the
squatters. The Municipal Trial Court in Cities (MTCC), Branch 1, Cebu City, rendered a decision on April 1,
1998, ordering the squatters to vacate the lot. On appeal, the RTC affirmed the MTCCs decision and issued
a writ of execution and order of demolition.1avvphi1

However, when the demolition order was about to be implemented, Cebu City Mayor Alvin Garcia wrote
two letters4to the MTCC, requesting the deferment of the demolition on the ground that the City was still
looking for a relocation site for the squatters. Acting on the mayors request, the MTCC issued two orders
suspending the demolition for a period of 120 days from February 22, 1999. Unfortunately for petitioners,
during the suspension period, the Sangguniang Panlungsod (SP) of Cebu City passed a resolution which
identified Lot 1029 as a socialized housing site pursuant to RA 7279.5 Then, on June 30, 1999, the SP of
Cebu City passed Ordinance No. 17726 which included Lot 1029 among the identified sites for socialized
housing. On July, 19, 2000, Ordinance No. 1843 7 was enacted by the SP of Cebu City authorizing the
mayor of Cebu City to initiate expropriation proceedings for the acquisition of Lot 1029 which was registered
in the name of petitioners. The intended acquisition was to be used for the benefit of the homeless after its
subdivision and sale to the actual occupants thereof. For this purpose, the ordinance appropriated the
amount of 6,881,600 for the payment of the subject lot. This ordinance was approved by Mayor Garcia on
August 2, 2000.

On August 29, 2000, petitioners filed with the RTC an action for declaration of nullity of Ordinance No. 1843
for being unconstitutional. The trial court rendered its decision on July 1, 2002 dismissing the complaint
filed by petitioners whose subsequent motion for reconsideration was likewise denied on August 26, 2002.

In this appeal, petitioners argue that Ordinance No. 1843 is unconstitutional as it sanctions the expropriation
of their property for the purpose of selling it to the squatters, an endeavor contrary to the concept of "public
use" contemplated in the Constitution.8 They allege that it will benefit only a handful of people. The
ordinance, according to petitioners, was obviously passed for politicking, the squatters undeniably being a
big source of votes.1avvphi1

In sum, this Court is being asked to resolve whether or not the intended expropriation by the City of Cebu
of a 4,048-square-meter parcel of land owned by petitioners contravenes the Constitution and applicable
laws.

Under Section 48 of RA 7160,9 otherwise known as the Local Government Code of 1991,10 local legislative
power shall be exercised by the Sangguniang Panlungsod of the city. The legislative acts of
the Sangguniang Panlungsodin the exercise of its lawmaking authority are denominated ordinances.

Local government units have no inherent power of eminent domain and can exercise it only when expressly
authorized by the legislature.11 By virtue of RA 7160, Congress conferred upon local government units the
power to expropriate. Ordinance No. 1843 was enacted pursuant to Section 19 of RA 7160:

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 xxx. (italics supplied).

Ordinance No. 1843 which authorized the expropriation of petitioners lot was enacted by the SP of Cebu
City to provide socialized housing for the homeless and low-income residents of the City.

However, while we recognize that housing is one of the most serious social problems of the country, local
government units do not possess unbridled authority to exercise their power of eminent domain in seeking
solutions to this problem.

There are two legal provisions which limit the exercise of this power: (1) no person shall be deprived of life,
liberty, or property without due process of law, nor shall any person be denied the equal protection of the
laws;12 and (2) private property shall not be taken for public use without just compensation. 13 Thus, the
exercise by local government units of the power of eminent domain is not absolute. In fact, Section 19 of
RA 7160 itself explicitly states that such exercise must comply with the provisions of the Constitution and
pertinent laws.

The exercise of the power of eminent domain drastically affects a landowners right to private property,
which is as much a constitutionally-protected right necessary for the preservation and enhancement of
personal dignity and intimately connected with the rights to life and liberty. 14 Whether directly exercised by
the State or by its authorized agents, the exercise of eminent domain is necessarily in derogation of private
rights.15 For this reason, the need for a painstaking scrutiny cannot be overemphasized.

The due process clause cannot be trampled upon each time an ordinance orders the expropriation of a
private individuals property. The courts cannot even adopt a hands-off policy simply because public use or
public purpose is invoked by an ordinance, or just compensation has been fixed and determined. In De
Knecht vs. Bautista,16 we said:

It is obvious then that a land-owner is covered by the mantle of protection due process affords. It
is a mandate of reason. It frowns on arbitrariness, it is the antithesis of any governmental act that
smacks of whim or caprice. It negates state power to act in an oppressive manner. It is, as had
been stressed so often, the embodiment of the sporting idea of fair play. In that sense, it stands as
a guaranty of justice. That is the standard that must be met by any governmental agency in the
exercise of whatever competence is entrusted to it. As was so emphatically stressed by the present
Chief Justice, "Acts of Congress, as well as those of the Executive, can deny due process only
under pain of nullity. xxx.
The foundation of the right to exercise eminent domain is genuine necessity and that necessity must be of
public character.17 Government may not capriciously or arbitrarily choose which private property should be
expropriated. In this case, there was no showing at all why petitioners property was singled out for
expropriation by the city ordinance or what necessity impelled the particular choice or selection. Ordinance
No. 1843 stated no reason for the choice of petitioners property as the site of a socialized housing project.

Condemnation of private lands in an irrational or piecemeal fashion or the random expropriation of small
lots to accommodate no more than a few tenants or squatters is certainly not the condemnation for public
use contemplated by the Constitution. This is depriving a citizen of his property for the convenience of a
few without perceptible benefit to the public.18

RA 7279 is the law that governs the local expropriation of property for purposes of urban land reform and
housing. Sections 9 and 10 thereof provide:

SEC 9. Priorities in the Acquisition of Land. Lands for socialized housing shall be acquired in the
following order:

(a) Those owned by the Government or any of its subdivisions, instrumentalities, or

agencies, including government-owned or controlled corporations and their subsidiaries;

(b) Alienable lands of the public domain;

(c) Unregistered or abandoned and idle lands;

(d) Those within the declared Areas or Priority Development, Zonal Improvement Program
sites, and Slum Improvement and Resettlement Program sites which have not yet been
acquired;

(e) Bagong Lipunan Improvement of Sites and Services or BLISS which have not yet been
acquired; and

(f) Privately-owned lands.

Where on-site development is found more practicable and advantageous to the beneficiaries, the
priorities mentioned in this section shall not apply. The local government units shall give budgetary
priority to on-site development of government lands. (Emphasis supplied).

SEC. 10. Modes of Land Acquisition. The modes of acquiring lands for purposes of this Act shall
include, among others, community mortgage, land swapping, land assembly or consolidation, land
banking, donation to the Government, joint venture agreement, negotiated purchase, and
expropriation: Provided, however, That expropriation shall be resorted to only when other
modes of acquisition have been exhausted: Provided further, That where expropriation is
resorted to, parcels of land owned by small property owners shall be exempted for purposes of this
Act: xxx. (Emphasis supplied).

In the recent case of Estate or Heirs of the Late Ex-Justice Jose B.L. Reyes et al. vs. City of Manila,19 we
ruled that the above-quoted provisions are strict limitations on the exercise of the power of eminent domain
by local government units, especially with respect to (1) the order of priority in acquiring land for socialized
housing and (2) the resort to expropriation proceedings as a means to acquiring it. Private lands rank last
in the order of priority for purposes of socialized housing. In the same vein, expropriation proceedings may
be resorted to only after the other modes of acquisition are exhausted. Compliance with these conditions
is mandatory because these are the only safeguards of oftentimes helpless owners of private property
against what may be a tyrannical violation of due process when their property is forcibly taken from them
allegedly for public use.

We have found nothing in the records indicating that the City of Cebu complied strictly with Sections 9 and
10 of RA 7279. Ordinance No. 1843 sought to expropriate petitioners property without any attempt to first
acquire the lands listed in (a) to (e) of Section 9 of RA 7279. Likewise, Cebu City failed to establish that the
other modes of acquisition in Section 10 of RA 7279 were first exhausted. Moreover, prior to the passage
of Ordinance No. 1843, there was no evidence of a valid and definite offer to buy petitioners property as
required by Section 19 of RA 7160.20 We therefore find Ordinance No. 1843 to be constitutionally infirm for
being violative of the petitioners right to due process.

It should also be noted that, as early as 1998, petitioners had already obtained a favorable judgment of
eviction against the illegal occupants of their property. The judgment in this ejectment case had, in fact,
already attained finality, with a writ of execution and an order of demolition. But Mayor Garcia requested
the trial court to suspend the demolition on the pretext that the City was still searching for a relocation site
for the squatters. However, instead of looking for a relocation site during the suspension period, the city
council suddenly enacted Ordinance No. 1843 for the expropriation of petitioners lot. It was trickery and
bad faith, pure and simple. The unconscionable manner in which the questioned ordinance was passed
clearly indicated that respondent City transgressed the Constitution, RA 7160 and RA 7279.

For an ordinance to be valid, it must not only be within the corporate powers of the city or municipality to
enact but must also be passed according to the procedure prescribed by law. It must be in accordance with
certain well-established basic principles of a substantive nature. These principles require that an ordinance
(1) must not contravene the Constitution or any statute (2) must not be unfair or oppressive (3) must not be
partial or discriminatory (4) must not prohibit but may regulate trade (5) must be general and consistent
with public policy, and (6) must not be unreasonable.21

Ordinance No. 1843 failed to comply with the foregoing substantive requirements. A clear case of
constitutional infirmity having been thus established, this Court is constrained to nullify the subject
ordinance. We recapitulate:

first, as earlier discussed, the questioned ordinance is repugnant to the pertinent provisions of the
Constitution, RA 7279 and RA 7160;

second, the precipitate manner in which it was enacted was plain oppression masquerading as a
pro-poor ordinance;

third, the fact that petitioners small property was singled out for expropriation for the purpose of
awarding it to no more than a few squatters indicated manifest partiality against petitioners, and

fourth, the ordinance failed to show that there was a reasonable relation between the end sought
and the means adopted. While the objective of the City of Cebu was to provide adequate housing
to slum dwellers, the means it employed in pursuit of such objective fell short of what was legal,
sensible and called for by the circumstances.

Indeed, experience has shown that the disregard of basic liberties and the use of short-sighted methods in
expropriation proceedings have not achieved the desired results. Over the years, the government has tried
to remedy the worsening squatter problem. Far from solving it, however, governments kid-glove approach
has only resulted in the multiplication and proliferation of squatter colonies and blighted areas. A pro-poor
program that is well-studied, adequately funded, genuinely sincere and truly respectful of everyones basic
rights is what this problem calls for, not the improvident enactment of politics-based ordinances targeting
small private lots in no rational fashion.
WHEREFORE, the petition is hereby GRANTED. The July 1, 2002 decision of Branch 23 of the Regional
Trial Court of Cebu City is REVERSED and SET ASIDE.

SO ORDERED.

Davide, Jr., Puno, Panganiban, Quisumbing, Ynares-Santiago, Sandoval-Gutierrez, Carpio, Austria-

Martinez, Carpio Morales*, Callejo, Sr., Azcuna*, Tinga, and Chico-Nazario*, JJ., concur.

Footnotes

* on leave

1 Presided by Judge Generosa G. Labra.

2 The records of the case do not state why and how the lots reverted to the Province of Cebu.

3 Now deceased.

4 Dated February 22, 1999 and May 20, 1999.

5 The Urban Development and Housing Act of 1992 (Lina Law).

6Entitled, "AN ORDINANCE FURTHER AMENDING ORDINANCE NO. 1656 AS AMENDED BY

ORDINANCE NO. 1684 OTHERWISE KNOWN AS THE 1966 REVISED ZONING ORDINANCE
OF THE CITY OF CEBU, BY INCORPORATING THEREIN A NEW DISTRICT CALLED
SOCIALIZED HOUSING SITES."

7Entitled "AN ORDINANCE AUTHORIZING THE CITY MAYOR OF CEBU CITY TO INSTITUTE
EXPROPRIATION PROCEEDINGS AGAINST MRS. CRISPINA VDA. DE LAGCAO, OWNER OF
LOT NO. 1029 LOCATED AT GREEN VALLEY, CAPITOL SITE, CEBU CITY, TO ACQUIRE
THE SAME FOR PUBLIC USE OR PURPOSE."

8Article IV, Section 9 "Private property shall not be taken for public use without just
compensation."

9 Section 48. Local Legislative Power Local legislative power shall be exercised by
the sangguniang panlalawigan for the province; the sangguniang panlungsod for the city;
the sangguniang bayan for the municipality; and the sangguniang barangay for the barangay.

10 The law was approved on October 10, 1991 and it became effective on January 1, 1992.

11 City of Cincinnati vs. Vester, 281 US 439, 74 L. ed 950, 50 S Ct. 360.

12 Article 3, Section 1, 1987 Constitution.

13 Article 3, Section 9, 1987 Constitution.

14 Joaquin G. Bernas, The Constitution of the Republic of the Philippines: A Commentary, vol. 1.
p. 43, 1987.

15 City of Manila vs. Chinese Community of Manila, 40 Phil. 349, 1919.

16 G.R. No. L-51078, 30 October 1980, 100 SCRA 660.

17 City of Manila vs. Chinese Community of Manila, supra.

18 Urban Estates, Inc. vs. Montesa, 88 Phil. 348 (1951).

19 G.R. Nos. 132431 and 137146, February 13, 2004.

20 Sec 19. Eminent Domain "xxx. 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: xxx."
ESTATE SALUD JIMENEZ, petitioner,
vs.
PHILIPPINES EXPORT PROCESSING ZONE, respondent.

DELEON, JR., J.:

Before us is a petition for review on certiorari of the Decision1 and the Resolution2 of the Court of
Appeals3 dated March 25, 1998 and January 14, 1999, respectively, which ordered the Presiding Judge of
the Regional trial Court of Cavite City, Branch 17, to proceed with the hearing of the expropriation
proceedings regarding the determination of just compensation for Lot 1406-B while setting aside the Orders
dated August 4, 19974 and November 3, 1997 of the said Regional Trial Court which ordered the peaceful
turnover to petitioner Estate of Salud Jimenez of said Lot 1406-B.

The facts are as follows:

On may 15, 1981, private respondent Philippines Export Processing Zone (PEZA), then called as the Export
Processing Zone Authority (EPZA), initiated before the Regional Trial Court of Cavite expropriation
proceedings5 on three (3) parcels of irrigated riceland in Rosario, Cavite. One of the lots, Lot 1406 (A and
B) of the San Francisco de Malabon Estate, with an approximate area of 29,008 square meters, is registered
in the name of Salud Jimenez under TCT No. T-113498 of the Registry of Deeds of Cavite.

More than ten (10) years later6, the said trial court in an Order 7 dated July 11, 1991 upheld the right of
private respondent PEZA to expropriate, among others, Lot 1406 (A and B). Reconsideration of the said
order was sought by petitioner contending that said lot would only be transferred to a private corporation,
Philippines Vinyl Corp., and hence would not be utilized for a public purpose.

In an Order8 dated October 25, 19997, the trial court reconsidered the Order dated July 11, 1991 and
released Lot 1406-A from expropriation while the expropriation of Lot 1406-B was maintained. Finding the
said order unacceptable, private respondent PEZA interposed an appeal to the Court of Appeals.

Meanwhile, petitioner wrote a letter to private respondent offering two (2) proposals, namely:

1. Withdrawal of private respondent's appeal with respect to Lot 1406-A I consideration of the
waiver of claim for damages and lass of income for the possession of said lot by private respondent.

2. The swap of Lot 1406-B with Lot 434 covered by TCT No. T-14772 since private respondent has
no money yet to pay for the lot.

Private respondent's Board approved the "proposal" and the compromise agreement was signed by private
respondent through its then administrator Tagumpay Jadiniano assisted by Government Corporate Counsel
Oscar I. Garcia. Said compromise agreement9 dated January 4, 1993 is quoted hereunder:

1. That plaintiff agrees to withdraw its appeal from the Order of the Honorable Court dated October
25, 1991 which released lot 1406-A from the expropriation proceedings. On the other hand,
defendant Estate of Salud Jimenez agrees to waive, quit claim and forfeit its claim for damages
and loss of income which it sustained by person of the possession of said lot by plaintiff from 1981
up to the present.

2. That the parties agree that defendant Estate of Salud Jimenez shall transfer lot 1406-B with an
area of 13,118 square meters which forms part of the lot registered under TCT No. 113498 of the
Registry of Deeds of Cavite to the name of the plaintiff and the same shall be swapped and
exchanged with lot 434 with an area of 14,167 square meters and covered by Transfer Certificate
 of Title No. 14772 of the Registry of Deeds of Cavite which lot will be transferred to the name of
Estate of Salud Jimenez.1wphi1.nt

3. That the swap arrangement recognized the fact that the lot 1406-B covered by TCT No. T-113498
of the state of defendant Salud Jimenez is considered expropriated in favor of the government
based on Order of the Honorable Court dated July 11, 1991. However, instead of being paid the
just compensation for said lot, the estate of said defendant shall be paid with lot 434 covered by
TCT No. T-14772.

4. That the parties agree that they will abide by the terms of the foregoing agreement in good faith
and the Decision to be rendered based on this Compromise Agreement is immediately final and
executory.

The Court of Appeals remanded the case to the trial court for the approval of the said compromise
agreement entered into between the parties, consequent with the withdrawal of the appeal with the Court
of Appeals. In the Order10 dated August 23, 1993, the trial court approved the compromise agreement.

However, private respondent failed to transfer the title of Lot 434 to petitioner inasmuch as it was not the
registered owner of the covering TCT No. T-14772 but Progressive Realty Estate, Inc. Thus, on March 13,
1997, petitioner Estate filed a "Motion to Partially Annul the Order dated August 23, 1993." 11

In the Order12 dated August 4, 1997, the trial court annulled the said compromise agreement entered into
between the parties and directed private respondent to peacefully turn over Lot 1406-A to the petitioner.
Disagreeing with the said Order of the trial court, respondent PEZA moved 13 for its reconsideration. The
same proved futile since the trial court denied reconsideration in its Order 14 dated November 3, 1997.

On December 4, 1997, the trial court, at the instance15 of petitioner, corrected the Orders dated August 4,
1997 and November 3, 1997 by declaring that it is Lot 1406-B and Lot 1406-A that should be surrendered
and returned to petitioner.

On November 27, 1997, respondent interposed before the Court of Appeals a petition for certiorari and
prohibition16seeking to nullify the Orders dated August 4, 1997 and November 3, 1997 of the court.
Petitioner filed its Comment17 on January 16, 1998.

Acting on the petition, the Court of Appeals in a Decision 18 dated March 25, 1998 upheld the rescission of
the compromise agreement, ratiocinating thus:

A judicial compromise may be enforced by a writ of execution, and if a party fails or refuses to abide
by the compromise, the other party may regard it as rescinded and insist upon his original demand.
This is in accordance with Article 2041 of the Civil Code, which provides:

If one of the parties fails or refuses to abide by the compromise, the other party may either enforce
the compromise or regard it as rescinded and insist upon his original demand."

The Supreme Court had the occasion to explain this provision of law in the case of Leonor v. Syip
(1 SCRA 1215). It ruled that the language of the above mentioned provision denotes that no action
for rescission is required and that the aggrieved party by the breach of compromise agreement,
may regard the compromise agreement already rescinded, to wit:

It is worthy of notice, in this connection, that, unlike article 2039 of the same Code, which
speaks of "a cause of annulment or rescission of the compromise" and provides that "the
compromise may be annulled or rescinded" for the cause therein specified, thus suggesting
an action for annulment or rescission, said Article 2041 confers upon the party concerned
 not a "cause" for rescission, or the right to "demand" rescission, of a compromise, but the
authority, not only to "regard it as rescinded," but, also, to 'insist upon his original demand."
The language of this Article 2041, particularly when contrasted with that of Article 2039,
denotes that no action for rescission is required in said Article 2041, and that to party
aggrieved by the breach of a compromise agreement may, if he chooses, bring the suit
contemplated or involved in his original demand, as if there had never been any
compromise agreement, without bringing an action for rescission thereof. He need not seek
a judicial declaration of rescission, for he may "regard" the compromise agreement already,
"rescinded".

Nonetheless, it held that:

Having upheld the rescission of the compromise agreement, what is then the status of the
expropriation proceedings? As succinctly discussed in the case of Leonor vs. Sycip, the aggrieved
party may insist on his original demand as if there had never been any compromise agreement.
This means that the situation of the parties will revert back to status before the execution of the
compromise agreement, that is, the second stage of the expropriation proceedings, which is the
determination of the just compensation.19

xxx

Thus, the appellate court partially granted the petition by setting aside the order of the trial court regarding
"the peaceful turn over to the Estate of Salud Jimenez of Lot No. 1406-B" and instead ordered the trial
judge to "proceed with the hearing of the expropriation proceedings regarding the determination of just
compensation over Lot 1406-B."20

Petitioner sought21 reconsideration of the Decision dated March 25, 1998. However, public respondent in a
resolution22 dated January 14, 1999 denied petitioner's motion for reconsideration.

Hence, this petition anchored on the following assignment of errors, to wit:

THE COURT OF APPEALS COMMITTED GRAVE AND REVERSIBLE ERROR IN GIVING DUE
COURSE TO THE SPECIAL CIVIL ACTION FILED BY RESPONDENT PEZA IN CA-G.R. SP.
NO. 46112 WHEN IT WAS MADE SUBSTITUTE FOR LOST APPEAL IN CLEAR
CONTRAVENTION OF THE HONORABLE COURT'S RULING IN SEMPIO VS. COURT OF
APPEALS (263 SCRA 617) AND ONGSITCO VS. COURT OF APPEALS (255 SCRA 703) AND
DESPITE THE FACT THAT THE ORDER OF THE CAVITE REGIONAL TRIAL COURT IS
ALREADY FINAL AND EXECUTORY.

II

GRANTING IN GRATIA ARGUMENTI THAT THE SPECIAL CIVIL ACTION OF CERTIONRARI

IS PROPER, THE COURT OF APPEALS NEVERTHELESS WRONGLY INTERPRETED THE
PHRASE "ORIGINAL DEMAND" CONTAINED IN ARTICLE 2041 OF PETITIONER ESTATE IS
THE RETURN OF THE SUBJECT LOT (LOT 1406-B) WHICH IS SOUGHT TO BE
EXPROPRIATED AND NOT THE DETERMINATION OF JUST COMPENSATION FOR THE LOT.
FURTHERMORE, EVEN IF THE INTERPRETATION OF THE COURT OF APPEALS OR THE
IMPORT OF THE PHRASE IN QUESTION IS CORRECT, IT IS ARTICLE 2039 OF THE CIVIL
CODE AND NOT ARTICLE 2041 WHICH IS APPLICABLE TO COMPROMISE AGREEMENTS
APPROVED BY THE COURTS.23
We rule in favor of the respondent.

Petitioner contends that the Court of Appeals erred in entertaining the petition for certiorari files by
respondent under Rule 65 of the Rules of Court, the same being actually a substitute for lost appeal. It
appeared that on August 11, 1997, respondent received the Order of the trial court dated August 4, 1997
annulling the compromise agreement. On August 26, 1997, that last day for the filling of a notice of appeal,
respondent filed instead a motion for reconsideration. The Order of the trial court denying the motion for
reconsideration was received by respondent on November 23, 1997. The reglementary period to appeal
therefore lapsed on November 24, 1997. On November 27, 1997, however, respondent filed with the Court
of Appeals a petition for certiorari docketed as CA-G.R. SP. No. 46112. Petitioner claims that appeal is the
proper remedy inasmuch as the Order dated August 4, 1997 of the Regional Trial Court is a final order that
completely disposes of the case. Besides, according to petitioner, respondent is estopped in asserting that
certiorari is the proper remedy inasmuch as it invoked the fifteen (15) day reglementary period for appeal
when if filed a motion for reconsideration on August 26, 1997 and not the sixty (60) day period for filing for
certiorari under Rule 65 of the Rules of Court.

The Court of Appeal did not err in entertaining the petition for certiorari under Rule 65 of The Rules of Court.
A petition for certiorari is the proper remedy when any tribunal, board, or officer exercising judicial or quasi-
judicial functions has acted without or in excess of its jurisdiction, or with grave abuse of discretion
amounting to lack or excess of jurisdiction and there is no appeal, nor any plain, speedy, and adequate
remedy at law.24 Grave abuse of discretion is defined as the capricious and whimsical exercise of judgment
as is equivalent to lack of jurisdiction. An error of judgment committed in the exercise of its legitimate
jurisdiction is not the same as "grave abuse of discretion." An abuse of discretion is not sufficient by itself
to justify the issuance of a writ of certiorari. The abuse must be grave and patent, and it must be shown that
the discretion was exercised arbitrarily and despotically.25

As a general rule, a petition for certiorari will not lie if an appeal is the proper remedy thereto such as when
an error of judgment as well as of procedure are involved. As long as a court acts within its jurisdiction and
does not gravely abuse its discretion in the exercise thereof, any supposed error committed by it will amount
to nothing more than an error of judgment reviewable by a timely appeal and not assailable by a special
civil action of certiorari. However, in certain exceptional cases, where the rigid application of such rule will
result in a manifest failure or miscarriage of justice, the provisions of the Rules of Court which are technical
rules may be relaxed. Certiorari has been deemed to be justified, for instance, in order to prevent irreparable
damage and injury to a party where the trial judge has capriciously and whimsically exercised his judgment,
or where there may be danger of clear failure of justice, or where and ordinary appeal would simply be
inadequate to relieve a party form the injurious effects of the judgment complained of. 26

Expropriation proceedings involve two (2) phases. The first phase ends either with an order of expropriation
(when the right of plaintiff to take the land and the public purpose to which they are to be devoted are
upheld) or an order of dismissal. Either order would be a final one since if finally disposes of the case. The
second phase concerns the determination of just compensation to be ascertained by three (3)
commissioners. It ends with an order fixing the amount to be paid to the dependant. Inasmuch as it leaves
nothing more to be done, this order finally disposes of the second stage. To both orders the remedy
therefrom is an appeal.27

In the case at bar, the first phase was terminated when the July 11, 1991 order of expropriation became
final and the parties subsequently entered into a compromise agreement regarding the mode of payment
of just compensation. When respondent failed to abide by the terms of the compromise agreement,
petitioner filed and action to partially rescind the same. Obviously, the trial could only validly order the
rescission of the compromise agreement anent the payment of just compensation inasmuch as that was
the subject of the compromise. However, on August 4, 1991, the trial court gravely abused its discretion
when it ordered the return of Lot 1406-B. It, in effect, annulled the Order of Expropriation dated July 11,
1991 which was already final and executory.
We affirm the appellate court's reliance on the cases of Aguilar v. Tan28 and Bautista v. Sarmiento29 wherein
it was ruled that the remedies of certiorari and appeal are not mutually exclusive remedies in certain
exceptional cases, such as when there is grave abuse of discretion, or when public welfare so requires.
The trial court gravely abused its discretion by setting aside the order of expropriation which has long
become final and executory and by ordering the return of Lot 1406-B to the petitioner. Its action was clearly
beyond its jurisdiction for it cannot modify a final and executory order. A final and executory order can only
be annulled by petition to annual the same on the ground of extrinsic fraud and lack of jurisdiction 30 or a
petition for relief from a final order or judgment under Rule 38 of the Rules of Court. However, no petition
to that effect was filed. Hence, though an order completely and finally disposes of the case, if appeal is not
a plain, speedy and adequate remedy at law of the interest of substantial justice requires, a petition for
certiorari may be availed of upon showing of lack or excess of jurisdiction or grave abuse of discretion on
the part of the trial court.

According to petitioner the rule that a petition for certiorari can be availed of despite the fact that the proper
remedy is an appeal only apples in cases where the petition is filed within the reglementary period for
appeal. Inasmuch as the petition in the case at bar was filed after the fifteen (15) day regulatory period to
appeal, said exceptional rule as enshrined in the cases of Aguilar v. Tan31 and Bautista v. Sarmiento32 is
not applicable. We find this interpretation too restrictive. The said cases do not set as a condition sine qua
non the filing of a petition for certiorari within the fifteen (15) day period to appeal in order for the said
petition to be entertained by the court. To espouse petitioner's contention would render inutile the sixty (60)
day period to file a petition for certiorari under Rule 65. In Republic v. Court of Appeals33, which also
involved an expropriation case where the parties entered in a compromise agreement on just
compensation, this Court entertained the petition for certiorari despite the existence of an appeal and
despite its being filed after the lapse of the fifteen (15) day period to appeal the same. We ruled that the
Court has not too infrequently given due course to a petition for certiorari, even when the proper remedy
would have been an appeal, where valid and compelling considerations would warrant such a recourse. 34 If
compelled to return the subject parcel of land, the respondent would divert its budget already allocated for
economic development in order to pay petitioner the rental payments from the lessee banks. Re-adjusting
its budget would hamper and disrupt the operation of the economic zone. We believe that the grave abuse
of discretion committed by the trial court and the consequent disruption in the operation of the economic
zone constitutes valid and compelling reasons to entertain the petition.

Petitioner next argues that the instances cited under Section 1 of Rule 41 of the Rules of Court 35 whereby
an appeal is not allowed are exclusive grounds for a petition for certiorari. Inasmuch as the August 4, 1997
Order rescinding the compromise agreement does not fall under any of the instances enumerated therein,
a petition for certiorari will not prosper. This reasoning is severely flawed. The said section is not phrased
to make the instances mentioned therein the sole grounds for a petition for certiorari. It only states that Rule
65 may be availed of under the grounds mentioned therein, but it never intended said enumeration to be
exclusive. It must be remembered that a wide breadth of discretion is granted a court of justice in certiorari
proceeding.36

In the second assignment of error, petitioner assails the interpretation by the Court of appeals of the phrase
"original demand" in Article 2041 of the New Civil Code vis--vis the case at bar. Article 2041 provides that,
"if one of the parties fails or refuses to abide by the compromise, the other party may either enforce the
compromise or regard it as rescinded and insist upon his "original demand" According to petitioner, the
appellate court erred in interpreting "original demand" as the fixing of just compensation. Petitioner claims
that the original demand is the return of Lot 1406-B as stated in petitioner's motion to dismiss 37 the
complaint for expropriation inasmuch as the incorporation of the expropriation order in the compromise
agreement subjected the said order to rescission. Since the order of expropriation was rescinded, the
authority of respondent to expropriate and the purpose of expropriation have again become subject to
dispute.

Petitioner cites cases38 which provide that upon the failure to pay by the lessee, the lessor can ask for the
return of the lot and the ejectment of the former, this being the lessor's original demand in the complaint.
We find said cases to be inapplicable to this instant case for the reason that the case at bar is not a simple
ejectment case. This is an expropriation case which involves two (2) orders: an expropriation order and an
order fixing just compensation. Once the first order becomes final and no appeal thereto is taken, the
authority to expropriate and its public use cannot anymore be questioned.

Contrary to petitioner's contention, the incorporation of the expropriation order in the compromise
agreement did not subject said to rescission but instead constituted an admission by petitioner of
respondent's authority to expropriate the subject parcel of land and the public purpose for which it was
expropriated. This is evident from paragraph three (3) of the compromise agreement which states that the
"swap arrangement recognizes the fact that Lot 1406-B covered by TCT No. T-113498 of the estate of
defendant Salud Jimenez is considered expropriated in favor of the government based on the Order of the
Honorable Court dated July 11, 1991." It is crystal clear from the contents of the agreement that the parties
limited the compromise agreement to matter of just compensation to petitioner. Said expropriate order is
not closely intertwined with the issue of payment such that failure to pay by respondent will also nullify the
right of respondent to expropriate. No statement to this effect was mentioned in the agreement. The Order
was mentioned in the agreement only to clarify what was subject to payment.1wphi1.nt

This court therefore finds that the Court of Appeals did not err in interpreting "original demand" to mean the
fixing of just compensation. The authority of respondent and the nature of the purpose thereof have been
put to rest when the Expropriation Order dated July 11, 1991 became final and was duly admitted by
petitioner in the compromise agreement. The only issue for consideration is the manner and amount of
payment due to petitioner. In fact, aside from the withdrawal of private respondent's appeal to the Court of
Appeals concerning Lot 1406-A, the matter of payment of just compensation was the only subject of the
compromise agreement dated January 4, 1993. Under the compromise agreement, petitioner was
supposed to receive respondent's Lot No. 434 in exchange for Lot 1406-B. When respondent failed to fulfill
its obligation to deliver Lot 434, petitioner can again demand for the payment but not the return of the
expropriated Lot 1406-B. This interpretation by the Court of Appeals is in according with Section 4 to 8,
Rule 67 of the Rules of Court.

We also find as inapplicable the ruling in Gatchalian v. Arlegui39 , a case cited by petitioner, where we held
that even a final judgment can still be compromised so long as it is full satisfied. As already stated, the
expropriation order was not the subject of the compromise agreement. It was only the mode of payment
which was the subject of the compromise agreement. Hence, the Order of Expropriation dated July 11,
1991 can no longer be annulled.

After having invoked the provisions of Article 2041, petitioner inconsistently contends that said article does
not apply to the case at bar inasmuch as it is only applicable to cases where a compromise has not been
approved by a court. In the case at bar, the trial court approved the compromise agreement. Petitioner
insists that Articles 2038, 2039 and 1330 of the New Civil Code should apply. Said articles provide that:

Article 2038. A compromise, in which there is mistake, fraud, violence, intimidation, undue
influence, or falsity of documents, is subject to the provisions of Article 1330 of this Code.

However, one of the parties cannot set up a mistake of fact as against the other if the latter, by
virtue of the compromise, has withdrawn from a litigation already commenced.

Article 2039. When the parties compromise generally on all differences which they might have with
each other, the discovery of documents referring to one or more but not to all of the questions
settled shall not itself be a cause for annulment or rescission of the compromise, unless said
documents have been concealed by one of the parties.

But the compromise may be annulled or rescinded if it refers only to one thing to which one of the
parties has no right, as shown by the newly discovered documents.(n)"
 Article 1330. A contract where consent is given through mistake, violence, intimidation, undue
influence, or fraud is voidable.40

The applicability of the above-quoted legal provisions will not change the outcome of the subject of the
rescission. Since the compromise agreement was only about the mode of payment by swapping of lots and
not about the right and purpose to expropriate the subject Lot 1406-B, only the originally agreed for of
compensation that is by cash payment, was rescinded.

This court holds that respondent has the legal authority to expropriate the subject Lot 1406-B and that the
same was for a valid public purpose. In Sumulong v. Guerrero41 , this Court has ruled that,

the "public use" requirement for a valid exercise of the power of eminent domain is a flexible and
evolving concept influenced by changing conditions. In this jurisdiction, the statutory and judicial
trend has been summarized as follows:

this court has ruled that the taking to be valid must be for public use. There was a time
when it was felt that a literal meaning should be attached to such a requirement. Whatever
project is undertaken must be for the public to enjoy as in the case of streets or parks.
Otherwise expropriation is not allowable. It is not anymore. As long as the purpose of the
taking is public, then the power of eminent domain comes into playIt is accurate to
beneficially employed for the general welfare satisfies the requirement of public use. [Heirs
of Juancho Ardona v. Reyes, 125 SCRA 220 (1983) at 234-235 quoting E. Fernando, the
Constitution of the Philippines 523-4(2nd Ed. 1977)

The term "public use" has acquired a more comprehensive coverage. To the literal import of the
term signifying strict use or employment by the public has been added the broader notion of indirect
public benefit or advantage.

In Manosca v. Court of Appeals, this Court has also held that what ultimately emerged is a concept of public
use which is just as abroad as "public welfare."42

Respondent PEZA expropriated the subject parcel of land pursuant to Proclamation No. 1980 dated May
30, 1980 issued by former President Ferdinand Marcos. Meanwhile, the power of eminent domain of
respondent is contained in its original charter, Presidential Decree No. 66, which provides that:

Section 23. Eminent Domain. For the acquisition of rights of way, or of any property for the
establishment of export processing zones, or of low-cost housing projects for the employees
working in such zones, or for the protection of watershed areas, or for the construction of dams,
reservoirs, wharves, piers, docks, quays, warehouses and other terminal facilities, structures and
approaches thereto, the Authority shall have the right and power to acquire the same by purchase,
by negotiation, or by condemnation proceedings. Should the authority elect to exercise the right of
eminent domain, comdemnation proceedings shall be maintained by and in the name of the
Authority and it may proceed in the manner provided for by law. (italics supplied)

Accordingly, subject Lot 1406-B was expropriated "for the constructionof terminal facilities, structures
and approaches thereto." The authority is broad enough to give the respondent substantial leeway in
deciding for what public use the expropriated property would be utilized. Pursuant to this broad authority,
respondent leased a portion of the lot to commercial banks while the rest was made a transportation
terminal. Said public purposes were even reaffirmed by Republic Act No. 7916, a law amending respondent
PEZA's original charter, which provides that:

Sec. 7 ECOZONE to be a Decentralized Agro-Industrial, industrial, Commercial/Trading, Tourist,

Investment and financial Community. Within the framework of the Constitution, the interest of
national sovereignty and territorial integrity of the Republic, ECOZONE shall be developed, as
 much as possible, into a decentralized, self-reliant and self-sustaining industrial,
commercial/trading, agro-industrial, tourist, banking, financial and investment center with minimum
government intervention. Each ECOZONE shall be provided with transportation,
telecommunications and other facilities needed to generate linkage with industries and employment
opportunities for its own habitants and those of nearby towns and cities.

The ECOZONE shall administer itself on economic, financial, industrial, tourism development and
such other matters within the exclusive competence of the national government. (italics supplied)

Among the powers of PEZA enumerated by the same law are:

Sec.12. Functions and Powers of PEZA Board. ---- The Philippines Economic Zone
Authority (PEZA) Board shall have the following function and powers:

(a) Set the general policies on the establishment and operations of the ECOZONE,
Industrial estate, exports processing zones, free trade zones, and the like:

xxx

(b) Regulate and undertake the establishment, operation and maintenance of utilities, other
services and infrastructure in the ECOZONE, such as heat, light and power, water supply,
telecommunications, transport, toll roads and bridges, port services, etc. and to fix just,
reasonable and competitive rates, fares, charges and fees thereof. 43

In Manila Railroad Co. v. Mitchel44 , this Court has ruled that in the exercise of eminent domain, only as
much land can be taken as is necessary for the legitimate purpose of the condemnation, the term
"necessary", in this connection, does not mean absolutely indispensable but requires only a reasonable
necessity of the taking for the stated purpose, growth and future needs of the enterprise. The respondent
cannot attain a self-sustaining and viable ECOZONE if inevitable needs in the expansion in the surrounding
areas are hampered by the mere refusal of the private landowners to part with their properties. The purpose
of creating an ECOZONE and other facilities is better served if respondent directly owns the areas subject
of the expansion program.

The contention of petitioner that the leasing of the subject lot to banks and building terminals was not
expressly mentioned in the original charter of respondent PEZA and that it was only after PEZA devoted
the lot to said purpose the Republic Act No. 7916 took effect, is not impressed with merit. It should be
pointed out that Presidential Decree No. 66 created the respondent PEZA to be a viable commercial,
industrial and investment area. According to the comprehensive wording of Presidential Decree No. 66, the
said decree did not intend to limit respondent PEZA to the establishment of an export processing zone but
it was also bestowed with authority to expropriate parcels of land "for the construction of terminal
facilities, structures and approaches thereto." Republic Act No. 7916 simply particularized the broad
language employed by Presidential Decree No. 66 by specifying the purposes for which PEZA shall devote
the condemned lots, that is, for the construction and operation of an industrial estate, an export processing
zone, free trade zones, and the like. The expropriation of Lot 1406-B for the purpose of being leased to
banks and for the construction of a terminal has the purpose of making banking and transportation facilities
easily accessible to the persons working at the industries located in PEZA. The expropriation of adjacent
areas therefore comes as a matter of necessity to bring life to the purpose of the law. In such a manner,
PEZA's goal of being a major force in the economic development of the country would be realized.
Furthermore, this Court has already ruled that:

(T)he Legislature may directly determine the necessity for appropriating private property for a
particular improvement for public use, and it may select the exact location of the improvement. In
such a case, it is well-settled that the utility of the proposed improvement, the existence of the
public necessity for its construction, the expediency of constructing it, the suitableness of the
 location selected, are all questions exclusively for the legislature to determine, and the courts have
no power to interfere or to substitute their own for those of the representatives of the people.

In the absence of some constitutional or statutory provision to the contrary, the necessity and
expediency of exercising the right of eminent domain are questions essentially political and not
judicial in their character.45

Inasmuch as both Presidential Decree No. 66 and Republic Act No. 7916, bestow respondent with authority
to develop terminal facilities and banking centers, this Court will not question the respondent's lease of
certain portions of the expropriated lot to banks, as well as the construction of terminal facilities.

Petitioner contends that respondent is bound by the representations of its Chief Civil Engineer when the
latter testified before the trial court that the lot was to be devoted for the construction of government offices.
Anent this issue, suffice it to say that PEZA can vary the purpose for which a condemned lot will be devoted
to provided that the same is for public use. Petitioner cannot impose or dictate on the respondent what
facilities to establish for as long as the same are for public purpose.

Lastly, petitioner appeals to the sense of justice and equity to this Court in restoring the said lot to its
possession. From the time of the filing of the expropriation case in 1981 up to the present, respondent has
not yet remunerated the petitioner although respondent has already received earnings from the rental
payments by lessees of the subject property.

We have rules that the concept of just compensation embraces not only the correct determination of the
amount to be paid to the owners of the land, but also the payment of the land within a reasonable time from
its taking. Without prompt payment, compensation cannot be considered "just" inasmuch as the property
owner is made to suffer the consequences of being immediately deprived of his land while being made to
wait for a decade or more before actually receiving the amount necessary to cope with his loss.46 Payment
of just compensation should follow as a matter of right immediately after the order of expropriation is issued.
Any delay in payment must be counted from said order. However, the delay to constitute a violation of due
process must be unreasonable and inexcusable: it must be deliberately done by a party in order to defeat
the ends of justice.

We find that respondent capriciously evaded its duty of giving what is due to petitioner. In the case at bar,
the expropriation order was issued by the trial court in 1991. The compromise agreement between the
parties was approved by the trial court in 1993. However, from 1993 up to the present, respondent has
failed in its obligation to pay petitioner to the prejudice of the latter. Respondent caused damage to petitioner
in making the latter to expect that it had a good title to the property to be swapped with Lot 1406-B; and
meanwhile, respondent has been reaping benefits from the lease or rental income of the said expropriated
lot. We cannot tolerate this oppressive exercise of the power of eminent domain by respondent. As we have
ruled in Cosculluela vs. Court of Appeals:47

In the present case, the irrigation project was completed and has been in operation since 1976.
The project is benefiting the farmers specifically and the community in general. Obviously, the
petitioner's land cannot be returned to him. However, it is high time that the petitioner be paid what
was due him eleven years ago. It is high time that the petitioner be paid what was due him eleven
years ago. It is arbitrary and capricious for a government agency to initiate expropriation
proceedings, seize a person's property, allow the judgment of the court to become final and
executory and then refuse to pay on the ground that there are no appropriations for the property
earlier taken and profitably used. We condemn in the strongest possible terms the cavalier attitude
of government officials who adopt such a despotic and irresponsible stance.

Though the respondent has committed a misdeed to petitioner, we cannot, however, grant the petitioner's
prayer for the return of the expropriated Lot No. 1406-B. The Order of expropriation dated July 11, 1991,
has long become final and executory. Petitioner cited Provincial Government of Sorsogon v. Rosa E. Vda.
De Villaroya48 to support its contention that it is entitled to a return of the lot where this court ruled that
"under ordinary circumstance, immediate return of the owners of the unpaid property is the obvious
remedy." However, the said statement was not the ruling in that case. As in order cases where there was
no prompt payment by the government, this Court declared in Sorsogon that "the Provincial Government
of Sorsogon is expected to immediately pay as directed should any further delay be encountered, the trial
court is directed to seize any patrimonial property or cash saving of the province in the amount necessary
to implement this decision." However, this Court also stressed and declared in that case that "In cases
where land is taken for public use, public interest, however, must be considered."

In view of all the foregoing, justice and equity dictate that this case be remanded to the trial court for hearing
of the expropriation proceedings on the determination of just compensation for Lot 1406-B and for its prompt
payment to the petitioner.

WHEREFORE, the instant petition is hereby denied. The Regional Trial Court of Cavite City is hereby
ordered to proceed with the hearing of the expropriation proceedings, docketed as Civil Case No. N-4029,
regarding the determination of just compensation for Lot 1406-B, covered and described in TCT No. T-
113498-Cavite, and to resolve the same with dispatch.

SO ORDERED.

Bellosillo, Mendoza, Quisumbing, and Buena, JJ., concur.

Footnote

1 Penned by Associate Justice Quirino D. Abad Santos, Jr. and concurred in by Associated Justice Ruben T. Reyes and Hilarion L. Aquino, in CA-
G.R.SP. No. 46112, Rollo, pp. 61-70.

2 Id., pp. 71-74.

3 Tenth Division.

4 The appellate court erroneously that it is the Order dated July 11, 1991 and not the Order dated August 4, 1997 which ordered the peaceful turn-over
to the Estate of Salud Jimenez of Lot 1406-B.

5 Entitled "EPZA v. Jose Pulido, Vicenta Panganiban, et al.", docketed as Civil Case No. N-4079 assigned to Branch 17: Rollo, pp. 75-84.

6 In a Motion to Dismiss filed on June 10, 1981, petitioner sought the dismissal of said expropriation case contending that the intended expropriation is
not for a public purpose. On respondent PEZA over Lot 1406. On August 13, 1981, Deputy Provincial Sheriff, in behalf of private respondent PEZA,
took possession of Lot 1406 owned by petitioner.1wphi1.nt

7 Rollo, pp. 88-92.

8 Id., pp. 93-96.

9 Id., pp. 97-99.

10 Id., pp. 100-101.

11 Id., pp. 102-111.

12 Id., pp. 112-116.

13 Id., pp. 117-123.

14 Id., pp. 124-126.

15 Id., pp. 127-131.

16 Id., pp. 132-164.

17 Id., pp. 165-192.

18 See Note No. 1. supra.

19 Italics supplied.

20 Rollo, p. 70.

21 Id., pp. 193-207.

22 See Note No. 2, supra.

23 Rollo, pp. 17-18.

24 Rules of Court, Rule 65, sec. 1.

25 Miranda v. Abaya, 311 SCRA 617, 631 (1999).

26 BF Corporation v. Court of Appeals, 288 SCRA 267 (1998).

27 Municipality of Bian vs. Garcia, 180 SCRA 576, 583-584 (1989).

28 31 SCRA 205 (1970).

29 138 SCRA 587 (1985).

30 Rules of Court, Rule 47, sec. 2.

31 See Note No. 20.

32 See Note No. 29.

33 Republic v. Court of Appeals, 296 SCRA 171 (1998).

34 Santo Tomas university Hospital vs. Surla, 294 SCRA 382 (1998).

35 Rule 41. SECTION 1. Subject of Appeal. An appeal may be taken from a judgment or final order that completely disposes of the case, or of a
particular matter therein when declared by these Rules to be appealable.

No appeal may be taken from:

a. An order denying a motion for new trial or reconsideration;

b. An order denying a petition for any similar motion seeding relief from judgment;
 c. An interlocutory order;
d. An order disallowing or dismissing an appeal;
e. An order denying a motion to set aside a judgment by consent, confession or compromise on the ground of fraud, mistake of
duress, or any other ground vitiating consent;
f. An order of execution;
g. A judgment or final order for or against one or more of several parties or in separate claims, counter-claims, cross-claims and
third party complaints, while case is pending, unless the court allows an appeal therefrom; and
h. An order dismissing an action without prejudice.

In all above instances where the judgment or final order is not appealable, the aggrieved party may file an appropriate civic action under Rule 65.(n)

36 Gutib v. Court of Appeals, 312 SCRA 365 (1999).

37 The motion to dismiss asked for the return of Lot 1406-B inasmuch as respondent would not devote the lot to public use.

38 Leonor v. Sycip, 1 SCRA 1215 (1961); Tionson v. Court of Appeals, 49 SCRA 429 (1973); Barreras, et. al. v. Garcia, et. al, 169 SCRA 401 (1989).

39 Gatchalian v. Arlegui, 75 SCRA 234 (1977).

40 Italics supplied.

41 154 SCRA 461, 467-468 (1987).

42 252 SCRA 412, 422 (1996), quoting Joaquin Bernas, The Constitution of the Republic of the Philippines, Vol. 1, 1987 ed., p. 282.

43 Italics supplied.

44 50 Phil 832, 837-838 (1927).

45 City of Manila v. Chinese Community of Manila, 40 Phil 349 (1919).

46 Land Bank of the Philippines v. Court of Appeals 258 SCRA 404, 408-409 (1996) quoting Municipality of Makati v. Court of Appeals, 190 SCRA 207,
213 (1990).

47 164 SCRA 393, 401 (1988).

48 153 SCRA 291, 302 (1987).