THE RIGHT OF SELF-ORGANIZATION OF MANAGERIAL EMPLOYEES

1. In the Matter of the IBP Membership Dues Delinquency of Atty. MARCIAL A. EDILION (IBP
Administrative Case No. MDD-1)
FACTS: The respondent Marcial A. Edillon is a duly licensed practicing attorney in the Philippines. On
November 29, 1975, the Integrated Bar of the Philippines (IBP for short) Board of Governors unanimously
adopted Resolution No. 75-65 in Administrative Case No. MDD-1 (In the Matter of the Membership Dues
Delinquency of Atty. Marcial A. Edillon) recommending to the Court the removal of the name of the respondent
from its Roll of Attorneys for "stubborn refusal to pay his membership dues" to the IBP since the latter's
constitution notwithstanding due notice. The core of the respondent's arguments is that the above provisions
constitute an invasion of his constitutional rights in the sense that he is being compelled, as a pre-condition to
maintaining his status as a lawyer in good standing, to be a member of the IBP and to pay the corresponding
dues, and that as a consequence of this compelled financial support of the said organization to which he is
admittedly personally antagonistic, he is being deprived of the rights to liberty and property guaranteed to him
by the Constitution. Hence, the respondent concludes, the above provisions of the Court Rule and of the IBP
By-Laws are void and of no legal force and effect. The respondent similarly questions the jurisdiction of the
Court to strike his name from the Roll of Attorneys, contending that the said matter is not among the justiciable
cases triable by the Court but is rather of an "administrative nature pertaining to an administrative body."
ISSUES:
Whether or not the respondent should be disbarred due to refusal to pay his membership dues?

HELD:
It is the unanimous sense of the Court that the respondent Marcial A. Edillon should be as he is hereby
disbarred, and his name is hereby ordered stricken from the Roll of Attorneys of the Court.

To compel a lawyer to be a member of the Integrated Bar is not violative of his constitutional freedom to
associate. Integration does not make a lawyer a member of any group of which he is not already a member.
He became a member of the Bar when he passed the Bar examinations.
All that integration actually does is to provide an official national organization for the well-defined but
unorganized and in cohesive group of which every lawyer is a ready a member. Bar integration does not
compel the lawyer to associate with anyone. He is free to attend or not attend the meetings of his Integrated
Bar Chapter or vote or refuse to vote in its elections as he chooses. The only compulsion to which he is
subjected is the payment of annual dues. The Supreme Court, in order to further the State's legitimate interest
in elevating the quality of professional legal services, may require that the cost of improving the profession in
this fashion be shared by the subjects and beneficiaries of the regulatory program - the lawyers. Moreover,
there is nothing in the Constitution that prohibits Court, under its constitutional power and duty to promulgate
rules concerning the admission to the practice of law and the integration of the Philippine Bar (Article X,
Section 5 of the 1973 Constitution), from requiring members of a privileged class, such as lawyers are, to pay a
reasonable fee toward defraying the expenses of regulation of the profession to which they belong. It is quite
apparent that the fee is indeed imposed as a regulatory measure, designed to raise funds for carrying out the
objectives and purposes of integration. Also, it clear that under the police power of the State, and under the
necessary powers granted to the Court to perpetuate its existence, the respondent's right to practice law
before the courts of this country should be and is a matter subject to regulation and inquiry. And, if the power to
impose the fee as a regulatory measure is recognize, then a penalty designed to enforce its payment, which
penalty may be avoided altogether by payment, is not void as unreasonable or arbitrary. It is sufficient to state
then that the matters of admission, suspension, disbarment and reinstatement of lawyers and their regulation
and supervision have been and are indisputably recognized as inherent judicial functions and responsibilities,
and the authorities holding such are legion. Thus, the court‘s jurisdiction was greatly reinforced by our 1973
Constitution when it explicitly granted to the Court the power to ―Promulgate rules concerning pleading practice
… and the admission to the practice of law and the integration of the Bar … (Article X, Sec 5(5), the power to
pass upon the fitness of the respondent to remain a member of the legal profession is indeed undoubtedly
vested in the Court.
 2. ARTHUR TARNATE vs. CARMELO C. NORIEL, 100 SCRA 93

The crux of the matter in this proceeding for certiorari with preliminary injunction is whether or not probationary
employees are entitled to vote in the election of officers and board members of a labor union. Respondent
Director Carmelo C. Noriel at first ruled that they could not, apparently relying on the applicable provision of the
Labor Code, which reads thus: "Any employee, whether employed for a definite period or not, with at least one
year of service, whether such service is continuous or broken, shall be considered a regular employee for
purposes of membership in any labor union., When, however, a motion for reconsideration was filed, he
granted it and allowed the votes to be counted. Hence this suit for certiorari.

In the election of union officers on October 23, 1977, there were two strong contenders, petitioner Arthur
Ternate and respondent Lucerio Fajardo. Petitioner received 308 votes and respondent 285 votes. Forty (40)
ballots cast by employees who classified as second helpers were challenged. They were included in the list of
qualified voters upon the motion of the Fajardo faction and over the opposition of the Ternate group. It was
imposed as a condition that the challenged ballots would be segregated and would be counted only after
passing upon the question of membership of the such second helpers. The Ternate group finally agreed to
allow them to participate in the election. On October 27, 1977, after the decision, the Fajardo group moved to
have the challenged votes opened. The Med-Arbiter granted the prayer. Respondent Director Noriel in the
order now challenged in this petition, as noted earlier, decided otherwise in a motion for reconsideration.

The Solicitor General when asked to comment, after stressing the constitutional right to form associations, a
corollary of which in the case of labor is the right to self-organization, pointed to Article 3 of the New Labor
Code in sustaining the power of respondent Director to issue the assailed order. Thus: "These constitutional
mandates are recognized in Article 3 of the New Labor Code. Further, Article 244 thereof is of the same tenor:
... — All persons employed in commercial, industrial and agricultural enterprises, including religious, medical or
educational institutions operating for profit, shall have the right to self-organization and to form, join, or assist
labor organizations for purposes of collective bargain. Reference to the constitutional right to freedom of
association is not without relevance. The more decisive question, however, is the force and effect of the Labor
Code provision as to when a probationary employee could in the language thereof "be considered a regular
employee for purposes of membership in any labor union."

The answer arrived at by this Court after due consideration of all factors bearing on such issue, is that the
condition thus imposed in the Labor Code requiring "at least one year of service" calls for application.
Petitioner, therefore, must prevail.

1. The reliance of petitioner on the applicable Labor Code provision is not in vain. It is definite and clear. At
least one year of service is required for an employee to enjoy the benefits "of membership in any labor union."
There is no ambiguity. Its validity has not been challenged. It, therefore, calls for application in the precise
terms it was enacted. As was pointed out in Gonzaga Court of Appeals: "It has been repeated time and time
again that where the statutory norm speaks unequivocally there is nothing for the courts to do except to apply
it. The law, leaving no doubt as to the scope of its operation, must be obeyed. Our decisions have consistently
been to that effect. There is thus no statutory support for the challenged order of respondent Noriel.

2. In reaching such a conclusion, this Court is not unaware of the implication for freedom of association. There
is plausibility on its face to the contention of the Solicitor General that to bar the probationary employees from
voting for union officials would run counter to such constitutional right. Nor should it be forgotten that in U.E.
Automotive Employees and Workers Union vs. Noriel, it was stressed that "freedom of association is explicitly
ordained; it is not merely derivative, peripheral or penumbral, as is the case in the United States. It can trace its
origin to the Malolos Constitution. A more realistic appraisal, however, of the labor situation would serve to
clarify matters. (The right to join a labor union remains undisputed. In the meanwhile however, for purposes of
electing the union officers, assuming it would be chosen as the sole bargaining unit in the negotiation for a
collective bargaining contract, the right of probationary employees could be thus restricted as provided for in
the Labor Code. The justification lies in the fact that management could, by the simple device of appointing
probationary employees in the labor union expected to prevail in the choice of the sole collective bargaining
agent, attain the result that would serve best its interests, not necessarily that of labor). It must have been such
a purpose that inspired a provision on this character. At any rate, there being no attack on its validity, it must
be given full force and effect.

3. The delay in the decision of this case is due to the fact that the required number of votes for this conclusion
could not be obtained until the last deliberation. Precisely to some of its members the argument based on
freedom of association weighed heavily. At any rate, before the next election takes place, matters hopefully
have been clarified by this decision.

WHEREFORE, the petition for certiorari is granted and the election of petitioner Arthur Ternate is upheld. The
restraining order issued on November 27, 1978 is lifted. This decision is immediately executory. No costs.

3. SAMAHANG MANGGAGAWA NG VIA MARE vs. HON. CARMELO C. NORIEL, 108 SCRA 381

On October 13, 1979, petitioner Samahang Manggagawa Ng Via Mare (SAMAVIM), a duly organized labor
union, requested respondent corporation, Via Mare Catering Services and Food Specialties, Inc., to enter into
a collective bargaining agreement therewith submitting proposals.

Thereafter, petitioner twice reiterated its request to al respondents to negotiate a cove bargaining a respondent
corporation allegedly terminated four (4) of petition's members.

On November 19, 1979, petitioner filed a Notice of Strike with the Ministry of labor that respondent corporation
neither assented nor refused to bargain collectively and that t corporation harassed petitioner's union
members.

The Bureau of Labor Relations, of which respondent Honorable Carmelo C. Noriel is Director, assumed
injunction over the labor dispute and through Med-Arbiter Roberto Landas, summoned petitioner and
respondent corporation to a conference/hearing on November 20, 1979. At the scheduled conference/hearing
before Med-Arbiter Landas, Counsel of management assured the union that Via Mare Catering Services and
Food Specialties, Inc., will negotiate with the union.

On November 21, 1979, petitioner and respondent corporation entered a "Preliminary Agreement", and on
November 24, 1979, petitioner and respondent corporation entered into an 'Initial Agreement'.

Petitioner and respondent corporation met on November 27, 1979. But on that date, respondent corporation
refused to negotiate a collective bargaining agreement as they had previously committed themselves. On
November 28, 1979, therefore, petitioner's members staged a walk-out, duly informing the Bureau of Labor
Relations thereof.

Petitioner and respondent corporation were also ordered by Med-Arbiter Victorians Calaycay to appear before
the Bureau of Labor Relations on December 3, 1979. In the meantime, petitioner's members returned to work.

On December 3. 1979, before the Bureau of Labor Relations, petitioner and respondent corporation entered
into an agreement which provided among other things, the following:

1. There will be a consent election;

xxx xxx xxx

6. That the parties will meet on December 17, 1979 to determine the eligible voters and date of election.

The only question before Director Noriel is whether or not the petitioner is the exclusive bargain representative
of the employees working for the respondent corporation in respect of which both the petitioner and the
respondent corporation agreed to hold a consent or certification election including in the voting those
employees who had been dismissed by the corporation conformably to the statement of the corporation's
counsel during the hearing before Us on January 9, 1980. Upon the other hand, the issue before Regional
Director Estrella is whether or not the termination of he employment of some of the petitioner's member is
justified. The two questions are unrelated and can be resolved independently of each other especially since it
had been stated as aforesaid that even the dismissed employees could take part in the certification election.

WHEREFORE, respondent Director Carmelo C. Noriel is hereby ordered to proceed with the holding of the
certification election as had been agreed between the petitioner and the respondent corporation. Costs against
the private respondents.

4. DOLORES VILLAR, et.al. vs. THE HON. AMADO G. INCIONG, April 20, 1983

Facts: Petitioners were members of the Amigo Employees Union-PAFLU, a duly registered labor organization
which, was the existing bargaining agent of the employees in private respondent Amigo Manufacturing, Inc.
(Company). The Company and the Amigo Employees Union-PAFLU had a CBA governing their labor relations,
which agreement was then about to expire on February 28, 1977. Within the last 60 days of the CBA, upon
written authority of at least 30% of the employees in the company, including the petitioners, the Federation of
Unions of Rizal (FUR) filed a petition for certification election with MOLE. The petition was opposed by the
PAFLU with whom the Amigo Employees Union was at that time affiliated. The same employees who had
signed the petition filed by FUR signed a joint resolution disaffiliating from PAFLU. Dolores Villar, representing
herself to be the authorized representative of the Amigo Employees Union, filed a petition for certification
election in the Company. The Amigo Employees Union-PAFLU intervened and moved for the dismissal of the
petition for certification election filed by Villar, on the ground, among others that Villar had no legal personality
to sign the petition since she was not an officer of the union nor is there factual or legal basis for her claim that
she was the authorized representative of the local union. Med-Arbiter dismissed the petition filed by Villar,
which dismissal is still pending appeal before BLR. Amigo Employees Union-PAFLU called a special meeting
of its general membership. A Resolution was thereby unanimously approved which called for the investigation
by the PAFLU national president, of all of the petitioners and one Felipe Manlapao, for continuously maligning
the union spreading false propaganda that the union officers were merely appointees of the management; and
for causing divisiveness in the union. PAFLU formed a Trial Committee to investigate the local union's charges
against the petitioners for acts of disloyalty. PAFLU and the Company concluded a new CBA which also
reincorporated the same provisions of the existing CBA, including the union security clause. PAFLU President
rendered a decision finding the petitioners guilty of the charges. PAFLU demanded the Company to terminate
the employment of the petitioners pursuant to the security clause of the CBA. Acting on PAFLU's demand, the
Company informed PAFLU that it will first secure the necessary clearances to terminate petitioners. PAFLU
requested the Company to put petitioners under preventive suspension pending the application for said
clearances to terminate the petitioners. The Company filed the request for clearance to terminate the
petitioners before DOLE which was granted. DOLE Secretary Inciong denied the appeal, hence, this petition
for review.

RULING: The Amigo Employees Union, as an independent union, is not duly registered as such with the
Bureau of Labor Relations. The appealed decision of OIC Leogardo of Regional Office No. 4 states as a fact
that there is no record in the Bureau of Labor Relations that the Amigo Employees Union (Independent) is
registered, and this is not disputed by petitioners, notwithstanding their allegation that the Amigo Employees
Union is a duly registered labor organization bearing Ministry of Labor Registration Certification No. 5290-IP
dated March 27, 1967. But the independent union organized after the "Sama-Samang Kapasiyahan" executed
February 7, 1977 could not have been registered earlier, much less March 27, 1967 under Registration
Certificate No. 5290-IP. As such unregistered union, it acquires no legal personality and is not entitled to the
rights and privileges granted by law to legitimate labor organizations upon issuance of the certificate of
registration.

The contention of petitioners that the new CBA concluded between Amigo Employees Union-PAFLU and the
Company on February 15, 1977 containing the union security clause cannot be invoked as against the
petitioners for offenses committed earlier than its conclusion, deserves scant consideration. We find it to be the
fact that the union security clause provided in the new CBA merely reproduced the union security clause
provided in the old CBA about to expire. And since petitioners were expelled from Amigo Employees Union-
PAFLU on March 28, 1982 upon denial of their Motion for Reconsideration of the decision expelling them, the
CBA of February 15, 1977 was already applicable to their case.

Finally, We reject petitioners' contention that respondent Minister committed error in law amounting to grave
abuse of discretion when he affirmed the conclusion made by the RO4 OIC, upholding the legal applicability of
the security clause of a CBA over alleged offenses committed earlier than its conclusion and within the 60-day
freedom period of an old CBA. In the first place, as We stated earlier, the security clause of the new CBA is a
reproduction or reiteration of the same clause in the old CBA. While petitioners were charged for alleged
commission of acts of disloyalty inimical to the interests of the Amigo Employees Union-PAFLU in the
Resolution of February 14, 1977 of the Amigo Employees Union- PAFLU and on February 15, 1977 PAFLU
and the Company entered into and concluded a new collective bargaining agreement, petitioners may not
escape the effects of the security clause under either the old CBA or the new CBA by claiming that the old
CBA had expired and that the new CBA cannot be given retroactive enforcement. To do so would be to create
a gap during which no agreement would govern, from the time the old contract expired to the time a new
agreement shall have been entered into with the union. As this Court said in Seno vs. Mendoza, 21 SCRA
1124, "without any agreement to govern the relations between labor and management in the interim, the
situation would well be productive of confusion and result in breaches of the law by either party. "

We, therefore, hold and rule that petitioners, although entitled to disaffiliate from their union and form a new
organization of their own, must, however, suffer the consequences of their separation from the union under the
security clause of the CBA.

5. PEOPLE vs FERRER, 48 SCRA 382

FACTS: Hon. Judge Simeon Ferrer is the Tarlac trial court judge that declared RA1700 or the Anti-Subversive
Act of 1957 as a bill of attainder. Thus, dismissing the information of subversion against the following: 1.)
Feliciano Co for being an officer/leader of the Communist Party of the Philippines (CPP) aggravated by
circumstances of contempt and insult to public officers, subversion by a band and aid of armed men to afford
impunity. 2.) Nilo Tayag and 5 others, for being members/leaders of the NPA, inciting, instigating people to
unite and overthrow the Philippine Government. Attended by Aggravating Circumstances of Aid or Armed Men,
Craft, and Fraud. The trial court is of opinion that 1.) The Congress usurped the powers of the judge 2.)
Assumed judicial magistracy by pronouncing the guilt of the CPP without any forms of safeguard of a judicial
trial. 3.) It created a presumption of organizational guilt by being members of the CPP regardless of
voluntariness.

The Anti Subversive Act of 1957 was approved 20June1957. It is an act to outlaw the CPP and similar
associations penalizing membership therein, and for other purposes. It defined the Communist Party being
although a political party is in fact an organized conspiracy to overthrow the Government, not only by force and
violence but also by deceit, subversion and other illegal means. It declares that the CPP is a clear and present
danger to the security of the Philippines. Section 4 provided that affiliation with full knowledge of the illegal acts
of the CPP is punishable. Section 5 states that due investigation by a designated prosecutor by the Secretary
of Justice be made prior to filing of information in court. Section 6 provides for penalty for furnishing false
evidence. Section 7 provides for 2 witnesses in open court for acts penalized by prision mayor to death.
Section 8 allows the renunciation of membership to the CCP through writing under oath. Section 9 declares the
constitutionality of the statute and its valid exercise under freedom if thought, assembly and association.

ISSUES:

(1) Whether or not RA1700 is a bill of attainder/ ex post facto law.

(2) Whether or Not RA1700 violates freedom of expression.

HELD: The court holds the VALIDITY Of the Anti-Subversion Act of 1957.

A bill of attainder is solely a legislative act. It punishes without the benefit of the trial. It is the substitution of
judicial determination to a legislative determination of guilt. In order for a statute be measured as a bill of
attainder, the following requisites must be present: 1.) The statute specifies persons, groups. 2.) the statute is
applied retroactively and reach past conduct. (A bill of attainder relatively is also an ex post facto law.)

In the case at bar, the statute simply declares the CPP as an organized conspiracy for the overthrow of the
Government for purposes of example of SECTION 4 of the Act. The Act applies not only to the CPP but also to
other organizations having the same purpose and their successors. The Act‘s focus is on the conduct not
person.

Membership to this organizations, to be UNLAWFUL, it must be shown that membership was acquired with the
intent to further the goals of the organization by overt acts. This is the element of MEMBERSHIP with
KNOWLEDGE that is punishable. This is the required proof of a member‘s direct participation. Why is
membership punished. Membership renders aid and encouragement to the organization. Membership makes
himself party to its unlawful acts.

Furthermore, the statute is PROSPECTIVE in nature. Section 4 prohibits acts committed after approval of the
act. The members of the subversive organizations before the passing of this Act is given an opportunity to
escape liability by renouncing membership in accordance with Section 8. The statute applies the principle of
mutatis mutandis or that the necessary changes having been made.

The declaration of that the CPP is an organized conspiracy to overthrow the Philippine Government should not
be the basis of guilt. This declaration is only a basis of Section 4 of the Act. The EXISTENCE OF
SUBSTANTIVE EVIL justifies the limitation to the exercise of ―Freedom of Expression and Association‖ in this
matter. Before the enactment of the statute and statements in the preamble, careful investigations by the
Congress were done. The court further stresses that whatever interest in freedom of speech and association is
excluded in the prohibition of membership in the CPP are weak considering NATIONAL SECURITY and
PRESERVATION of DEMOCRACY.

The court set basic guidelines to be observed in the prosecution under RA1700. In addition to proving
circumstances/ evidences of subversion, the following elements must also be established:

1. Subversive Organizations besides the CPP, it must be proven that the organization purpose is to overthrow
the present Government of the Philippines and establish a domination of a FOREIGN POWER. Membership is
willfully and knowingly done by overt acts.
2. In case of CPP, the continued pursuance of its subversive purpose. Membership is willfully and knowingly
done by overt acts.

The court did not make any judgment on the crimes of the accused under the Act. The Supreme Court set
aside the resolution of the TRIAL COURT.

6. PEOPLE vs. FERRER, 56 SCRA 793

FERNANDO, J., dissenting:

My dissent from the well-written opinion of Justice Castro in the decision promulgated on December 27, 1972
opened with this paragraph: "It is with regret that I find myself unable to join the rest of my brethren in the
decision reached upholding the validity of the Anti-Subversion Act. It is to be admitted that the learned and
scholarly opinion of Justice Castro has the impress of conscientious and painstaking scrutiny of the
Constitutional issues raised. What is more, the stress in the concluding portion thereof on the basic guidelines
that will assure in the trial of those prosecuted under such Act respect for their constitutional rights is to be
commended. Nonetheless, my own reading of the decisions cited, interpreting the bill of attainder clause
coupled with the fears, perhaps induced by a too-latitudinarian construction of the guarantees of freedom of
belief and expression as well as freedom of association as to impermissible inroads to which they may be
exposed, compels a different conclusion."1

It is beyond cavil that the present resolution bears the imprint of lucidity and comprehensiveness, characteristic
of the opinions of Justice Castro. I regret however that the basic premise that precluded me from yielding
concurrence to the decision is once again a bar to my conformity. There is no need then to repeal what was
said by me before. It only remains to be added that the stress on the conspiracy principle in the resolution, to
be sure in conformity with sound and settled concepts, does give rise to misgivings as to its too broad a scope.
That is why I would like to express briefly my doubts on the matter.

For the purposes of this dissent, I adopt the characterization of Justice Jackson that conspiracy has in it the
elements of the "elastic, sprawling and pervasive" resulting at times in "a serious threat to fairness in our
administration of justice."2 His concurring opinion in Krulewitch continues: "The modern crime of conspiracy is
so vague that it almost defies definition. Despite certain elementary and essential elements, it also,
chameleon-like, takes on a special coloration from each of the many independent offenses on which it may be
overlaid. It is always "predominantly mental in composition" because it consists primarily of a meeting of minds
and an intent."3 Its relationship to political offenses was discussed by him in these terms: "The crime comes
down to us wrapped in vague but unpleasant connotations. It sounds historical undertones of treachery, secret
plotting and violence on a scale that menaces social stability and the security of the state itself. "Privy
conspiracy" ranks with sedition and rebellion in the Litany's prayer for deliverance. Conspirational movements
do indeed lie back of the political assassination, the coup d'etat, the putsch, the revolution, and seizures of
power in modern times, as they have in all history."4

Along the same line are the comments of Professor Johnson on the dangers of conspiracy to freedom of
thought and expression. Thus: "Prosecutions of political dissidents, including labor organizers, Communist
Party leaders, and contemporary radicals, typically have been conspiracy prosecutions. The law of conspiracy
is intended, after all, to make it easier to impose criminal punishment on members of groups that plot forbidden
activity. Insofar as it accomplishes this end, it unavoidably increases the likelihood that persons will be
punished for what they say rather than for what they do or for associating with others who are found culpable.
Critics who are alarmed at the resulting threat to freedom of speech and freedom of association typically have
proposed new constitutional doctrines derived from the first amendment to curtail the use of conspiracy
charges in cases having some "political" element."5 For Professor Johnson, it does not suffice "to reform
conspiracy legislatively by removing its most widely deplored overextensions, or to reform it judicially by
engrafting new doctrines derived from the first amendment [freedom of speech and of the press]." 6 He would
expunge it from the corpus of the law. "The law of criminal conspiracy is not basically sound. It should be
abolished, not reformed."7

Let there be no misunderstanding. I am not prepared to go that far. It does occur to me, though, that with due
recognition of the persuasive character of the resolution from the standpoint of defense against the dangers of
subversion as well as the desire of my brethren to give the utmost protection to constitutional rights, under
current conditions with the serious problems posed, still I find it difficult to dispel my grave doubts as to
Republic Act No. 1700 suffering from the corrosion of constitutional infirmity, as set forth in some detail in my
dissent.

Regretfully, I am compelled to do so again.

 CHAPTER X
THE POWER OF EMINENT DOMAIN
Section 9. Private property shall not be taken for public use without just compensation.

1. THE INHERENT POWER OF EMINENT DOMAIN

The power of eminent domain is the inherent right of the State to condemn or to take private property for public
use upon payment of just compensation.
GREEN NOTES:
May a Barangay validly exercise the power of eminent domain?
Yes, subject to the approval by the President.( Barangay Matictic vs. Elbinias, 148 SCRA 83)

BARANGAY MATICTIC, Municipality of Norzagaray, Province of Bulacan vs.HONORABLE J. M. ELBINIAS,

148 SCRA 83
FACTS: On December 7, 1968, petitioner (then called Barrio Matictic) filed with the then Court of First Instance
of Bulacan, Branch V, an action for injunction entitled Barrio Matictic vs. ZosimoSerapio, et al., praying that the
defendants (who are the private respondents in the instant case) be enjoined from placing obstructions and
closing the barrio road and to allow plaintiff to remove the obstructions and repair the barrio road (the
Poblacion-Tomana-Canyakan barrio road) so as "to enable the people and motorized vehicles the free use
thereof and convenient passage through it. "; Motion to dismiss the case was filed by BrgyMatictic on the
ground that an injunction is the better remedy for this case and it was granted. However, a complaint for
EMINENT DOMAIN was filed by the Municipality of Norzagaray.

Several case dismissals were filed. The Court issued orders to Norzagaray to submit plans of the land
to be expropriated, which they failed to comply. Leading to the termination of the case. The dismissal was
appealed by Norzagaray and the decision was reversed. The case went back to the court a quo, however this
time the municipality displayed reluctance to prosecute the case on eminent domain. Petitioner herein,
Barangay Matictic, chagrined and confronted by the attitude of its mayor, and on its averment that the result of
the expropriation case will greatly affect the social and economic development of the area in and around
Barangay Matictic,. This was dismissed by the judge. On the singular reason that at the time the expropriation
case was initially filed there was no showing of any prior Presidential approval-a requisite that should have
been first complied with, pursuant to Section 2245 of the Revised Administrative Code. A motion for
reconsideration of this decision was filed by plaintiff municipality. It insisted that presidential approval was, after
all, secured and that this fact was alleged in the plaintiff's amended complaint. Said motion for reconsideration
was, however, denied in the order of the court below, dated January 15, 1978. This order closed the case for
the plaintiff municipality of Norzagaray inasmuch as it no longer appealed said order of dismissal.

RULING: The Court rejected petitioner's averment that public respondent Judge "acted with grave and
manifest abuse of discretion." Firstly, nothing is lost to the petitioner. If at all petitioner can rightfully establish
that it is allowed by law to institute a separate and independent action of its own, then there would be no
necessity for it to intervene in the case initiated by the Municipality of Norzagaray which is now apparently no
longer interested in continuing the expropriation proceedings. The dismissal of the expropriation case was
without prejudice. The municipality of Norzagaray, Bulacan can revive its action. There is no need for the
proposed intervention of Barrio Matictic. What it may do is to urge the municipality to file its case anew. If the
Barangay has obtained authority for itself to pursue the action of eminent domain, then the more reason there
is to refuse its intervention.

Approximately, if the rights of the party seeking to intervene not be prejudiced by any judgment
in the case at bar and that it may be fully protected in a separate proceeding in then the
 exercise of judicial discretion in court , denying a motion for intervention is deemed correctly
made. (See Pflieder vs. de Britanica, L-19077, October 20,1964, cited in 51 SCRA 368).

Considering the foregoing discussion indicating the lack of merit of the petition for certiorari, it will follow that
the writ of mandamus prayed for by petitioner cannot be granted for lack of legal basis.

WHEREFORE, the instant petition is hereby DENIED for lack of merit

3. PROCEDURE FOR THE EXERCISE OD SAID POWER AND WHEN MAY A WRIT
OF POSESSION BE ISSUED IN FAVOR OF THE GOVERNMENT
GREEN NOTES:
What are the requisites before an expropriator may validly obtain a writ of possession to take over
possession of the expropriated property?
It depends:
1. If the expropriation is for a ―National government projects‖ or ―national infrastructure projects‖, like
those covered by the ―Build-Operate-Transfer‖, RA 8974 shall be followed. This means that there must
be a [a] Complaint for expropriation which is sufficient in form and in substance; and [2] the 100% of the
market value of the property sought to be expropriated must first be paid to the owner of the property.
(REPUBLIC OF THE PHILIPPINES VS. JUDGE GINGOYON, 478 SCRA 474)
2. In ordinary expropriation cases, the rule is that in the case of BIGLANG-AWA VS. JUDGE BACALLA,
354 SCRA 562. It provides:
PURSUANT TO SECTION 2, RULE 67 OF THE 1997 RULES OF CIVIL PROCEDURE AND THE
DOCTRINE LAID DOWN IN THE ROBERN DEVELOPMENT CASE, THE ONLY REQUISITES FOR THE
IMMEDIATE ENTRY BY THE GOVERNMENT IN EXPROPRIATION CASES ARE:
the filing of a complaint for expropriation sufficient in form and substance; and
the making of a deposit equivalent to the ASSESSED VALUE OF THE PROPERTY SUBJECT
TO EXPROPRIATION.
3. If the expropriation is being done by a Local Government Unit, the Supreme Court decision in the case
of THE CITY OF ILOILO VS. JUDGE LEGASPI, RTC 22, ILOILO CITY, 444 SCRA 269, shall be
complied with:
1. the complaint for expropriation filed in court is sufficient in form and
substance; and
2. the expropriator must deposit the amount equivalent to 15% of the fair
market value of the property to be expropriated based on its current tax
declaration.

1. SALVADOR BIGLANG-AWA, REMEDIOS BIGLANG-AWA vs. HON. JUDGE MARCIANO I.

BACALLA, 354 SCRA 562
FACTS: Petitioners RemediosBiglang-awa and Salvador Biglang-awa are the registered owners of certain
parcels of land situated in Talipapa, Novaliches, Quezon City. The parcel of land owned by petitioner
RemediosBiglang-awa is covered by T.C.T. No. RT-101389 (362966) with an area of 769 sq. m., while that
owned by Salvador Biglang-awa is covered by T.C.T. No. RT-101390 (19352) with an area of 2,151 sq.
m. The government needed to expropriate 558 sq. m. of the aforesaid property of petitioner RemediosBiglang-
awa, and 881 sq. m. of that belonging to petitioner Salvador Biglang-awa for the construction of the Mindanao
Avenue Extension, Stages II-B and II-C. Remediosreceived a notice from the DPWH to submit the documents
necessary to determine the just compensation for her property. She failed to comply with the 5 days period to
submit the said documents otherwise, expropriation proceedings will be filed against her properties. Hence,
separate cases for expropriation was filed.
 Through the DPWH, amounts of P 3,964,500 and P 2,511,00 was deposited with the Land Bank of the
Philippines for the said properties. Motions for the Issuance of Writs of Possession of the properties of the
petitioners with the respondent court was filed. The court issued Orders giving the petitioners, through counsel
Atty. Jose Felix Lucero, ten (10) days within which to submit their Opposition to the said motions. The
petitioners failed to file their Opposition to the Motion.
Petitioners then received a Notice to Vacate their properties, through their counsel, they moved for a
reconsideration. They avered that the respondent Republic failed to comply with the provisions of E.O. 1035
(1985), relating to the conduct of feasibility studies, information campaign, detailed engineering/surveys, and
negotiation prior to the acquisition of, or entry into, the property being expropriated. e respondent court issued
an Order denying the petitioners‘ Motion for Reconsideration, a copy of which was received by the petitioners
on July 26, 1999.
RULING: The court did not gravely abused its discretion in issuing the questioned orders.

“Expropriation proceedings are governed by revised Rule 67 of the 1997 Rules of Civil Procedure
which took effect on July 1, 1997. Previous doctrines inconsistent with this Rule are deemed reversed or
modified. Specifically, (1) an answer, not a motion to dismiss, is the responsive pleading to a complaint in
eminent domain; (2) the trial court may issue a writ of possession once the plaintiff deposits an amount
equivalent to the assessed value of the property, pursuant to Section 2 of said Rule, without need of a
hearing to determine the provisional sum to be deposited; and (3) a final order of expropriation may not be
issued prior to a full hearing and resolution of the objections and defenses of the property owner.” (Emphasis
Ours)

Thus, pursuant to Section 2 of Rule 67 of the 1997 Revised Rules of Civil Procedure and the Robern
Development Corporation case, the only requisites for authorizing immediate entry in expropriation
proceedings are: (1) the filing of a complaint for expropriation sufficient in form and substance; and (2) the
making of a deposit equivalent to the assessed value of the property subject to expropriation. Upon
compliance with the requirements the issuance of the writ of possession becomes ―ministerial.

When petitioner Remedios received a Notice to Vacate her property on September 11, 1998, the
petitioners immediately tried to get in touch with their former counsel, Atty. Jose Felix Lucero, but to no avail as
the latter refused to talk to them or even answer their letter. [18] No reason was given for the behavior of the
counsel. The petitioners wasted no time in hiring the services of a new counsel, the law firm of Gumpal and
Valenzuela. Considering that once the deposit under Section 2 of Rule 67 of the 1997 Revised Rules on Civil
Procedure has been made, the expropriator becomes entitled to a writ of possession as a matter of right, and
the issuance of the writ becomes ministerial on the part of the trial court, no opposition on the part of the
petitioners on the grounds now pleaded could have prevented such issuance. Therefore, the petitioners were
not prejudiced by the lost opportunity to file their opposition to the respondent‘s Motions for the Issuance of
Writs of Possession.
The instant petition is DISMISSED for lack of merit.

2. THE CITY OF ILOILO vs. HON. JUDGE EMILIO LEGASPI, 444 SCRA 269
FACTS: The SangguniangPanlungsod of the City of Iloilo on March 7, 2001 enacted regulation ordinance
granting umbrella authority to then Mayor Mansueto A. Malabor to institute expropriation proceedings on Lot
No. 935, registered in the name of Manuela Yusay, located at barangay Sto. Niño Norte, Arevalo, Iloilo City.
On March 14, 2001, Mayor Malabor wrote Mrs. Sylvia Yusaydel Rosario, administration of the estate, making
formal offer to purchase the property for the purpose of converting the same as an on-site relocation for the
poor and landless resident of the city. With apparent refusal to sell the property, the city represented by Mayor
Jerry P. Treñas filed an expropriation case based on the Power of State on Eminent Domain. Upon the strict
compliance to the governing rules on expropriation, the city of Iloilo argued that it is entitled to an immediate
issuance of a writ of possession.
ISSUE: WON the lower court committed grave abuse of discretion amounting to lack or excess of jurisdiction in
denying the motion for reconsideration dated may 9, 2002 as contained in its order of june 5, 2002, and in
holding that petitioners motion for issuance of writ of possession be resolved after herein petitioner has
convinced the trial court that it has a meritorious case of eminent domain, despite the provisions of section 2,
rule 67 of the 1997 rules of civil procedure and despite the ruling of the supreme court in the case of robern
development corporation vs. Judge jesus v. Quitain, et al.
RULING: Petitioner has the irrefutable right to exercise its power of eminent domain. It being a local
government unit, the basis for its exercise is granted under Section 19 of Rep. Act No. 7160, to wit:
Sec. 19 Eminent Domain. - A local government unit may, through its chief executive and acting pursuant to an
ordinance, exercise the power of eminent domain for public use, or purpose, or welfare for the benefit of the
poor and the landless, upon payment of just compensation, pursuant to the provisions of the Constitution and
pertinent laws.
The requisites for authorizing immediate entry are as follows: (1) the filing of a complaint for expropriation
sufficient in form and substance; and (2) the deposit of the amount equivalent to fifteen percent (15%) of the
fair market value of the property to be expropriated based on its current tax declaration. [31] Upon compliance
with these requirements, the issuance of a writ of possession becomes ministerial.[32]
In the case at bar, petitioner avers that the Amended Complaint it filed complies with both requisites, thus
entitling it to a writ of possession as a matter of right and the issuance thereof becoming ministerial on the part
of the lower court even without any hearing. On the other hand, private respondents allege that the Amended
Complaint is not sufficient in form and substance since it failed to allege compliance with the mandatory
requirements for the exercise of the power of eminent domain for purposes of socialized housing.
Under the facts of the case, estoppel should not apply because petitioner is simply following the procedure laid
down by the rules and jurisprudence. Under Section 19[38] of Rep. Act No. 7160 (law governing exercise of
eminent domain by local government units [LGU]) and Section 2[39] of Rule 67 of the Revised Rules of Civil
Procedure (law governing exercise of eminent domain by entities other than LGUs).
The instant petition is GRANTED.

3. REPUBLIC vs HON. HENRICK GINGOYON, 478 SCRA 474

FACTS: The present controversy has its roots with the promulgation of the Court‘s decision in Agan v.
PIATCO, promulgated in 2003 (2003 Decision). This decision nullified the ―Concession Agreement for the
Build-Operate-and-Transfer Arrangement of the Ninoy Aquino International Airport Passenger Terminal III‖
entered into between the Philippine Government (Government) and the Philippine International Air Terminals
Co., Inc. (PIATCO), as well as the amendments and supplements thereto.
The agreement had authorized PIATCO to build a new international airport terminal (NAIA 3), as well as a
franchise to operate and maintain the said terminal during the concession period of 25 years. The contracts
were nullified and that the agreement was contrary to public policy. At the time of the promulgation of the 2003
Decision, the NAIA 3 facilities had already been built by PIATCO and were nearing completion. However, the
ponencia was silent as to the legal status of the NAIA 3 facilities following the nullification of the contracts, as
well as whatever rights of PIATCO for reimbursement for its expenses in the construction of the facilities.
After the promulgation of the rulings in Agan, the NAIA 3 facilities have remained in the possession of PIATCO,
despite the avowed intent of the Government to put the airport terminal into immediate operation. The
Government and PIATCO conducted several rounds of negotiation regarding the NAIA 3 facilities.
In 2004, the Government filed a Complaint for expropriation with the Pasay RTC. The Government sought
upon the filing of the complaint the issuance of a writ of possession authorizing it to take immediate possession
and control over the NAIA 3 facilities. The Government also declared that it had deposited the amount of
P3,002,125,000.00 (3 Billion) in Cash with the Land Bank of the Philippines, representing the NAIA 3 terminal‘s
assessed value for taxation purposes. The Government insists that Rule 67 of the Rules of Court governs the
expropriation proceedings in this case to the exclusion of all other laws. On the other hand, PIATCO claims
that it is Rep. Act No. 8974 which does apply.
ISSUE: Whether or not Rule 67 of the Rules of Court or Rep. Act No. 8974 governs the expropriation
proceedings in this case?
HELD: The 2004 Resolution in Agan sets the base requirement that has to be observed before the
Government may take over the NAIA 3, that there must be payment to PIATCO of just compensation in
accordance with law and equity. Any ruling in the present expropriation case must be conformable to the
dictates of the Court as pronounced in the Agan cases.
Rule 67 outlines the procedure under which eminent domain may be exercised by the Government.
Rep. Act No. 8974, which covers expropriation proceedings intended for national government infrastructure
projects. Rep. Act No. 8974, which provides for a procedure eminently more favorable to the property owner
than Rule 67, inescapably applies in instances when the national government expropriates property ―for
national government infrastructure projects.‖ Thus, if expropriation is engaged in by the national government
for purposes other than national infrastructure projects, the assessed value standard and the deposit mode
prescribed in Rule 67 continues to apply.
Rep. Act No. 8974 applies in this case, particularly insofar as it requires the immediate payment by the
Government of at least the proffered value of the NAIA 3 facilities to PIATCO and provides certain valuation
standards or methods for the determination of just compensation.
Applying Rep. Act No. 8974, the implementation of Writ of Possession in favor of the Government over NAIA 3
is held in abeyance until PIATCO is directly paid the amount of P3 Billion, representing the proffered value of
NAIA 3 under Section 4(c) of the law.

4. REPUBLIC vs. HOLY TRINITY REALTY DEVELOPMENT CORPORATION, April 14, 2008
FACTS: On 29 December 2000, petitioner Republic of the Philippines, represented by the Toll Regulatory
Board (TRB), filed with the RTC a Consolidated Complaint for Expropriation against landowners whose
properties would be affected by the construction, rehabilitation and expansion of the North Luzon Expressway.
The suit was docketed as Civil Case No. 869-M2000 and raffled to Branch 85, Malolos, Bulacan. Respondent
Holy Trinity Realty and Development Corporation (HTRDC) was one of the affected landowners. On 18 March
2002, TRB filed an Urgent Ex-Parte Motion for the issuance of a Writ of Possession, manifesting that it
deposited a sufficient amount to cover the payment of 100% of the zonal value of the affected properties, in the
total amount of P28,406,700.00, with the Land Bank of the Philippines, South Harbor Branch (LBP-South
Harbor), an authorized government depository. TRB maintained that since it had already complied with the
provisions of Section 4 of Republic Act No. 897441in relation to Section 2 of Rule 67 of the Rules of Court, the
issuance of the writ of possession becomes ministerial on the part of the RTC.The RTC issued, on 19 March
2002, an Order for the Issuance of a Writ of Possession. On 3 March 2003, HTRDC filed with the RTC a
Motion to Withdraw Deposit, praying that the respondent or its duly authorized representative be allowed to
withdraw the amount of P22,968,000.00, out of TRB‘s advance deposit of P28,406,700.00 with LBP-South
Harbor, including the interest which accrued thereon. Thereafter, the RTC allowed the release of the
principal amount together with the interest to the respondent but on Motion for Reconsideration of the TRB, it
disallowed the withdrawal of the interest reasoning out that the said issue will be included in the second stage
of expropriation, that is, the determination of just compensation. The private respondent elevated the issue to
the Court of Appeals which ruled that the respondent is entitled to the interest by way of accession. Hence, this
petition of the government before the Supreme Court.
ISSUE: Who has the right over the interest of the amount deposited representing the zonal value of the
property sought to be expropriated? The expropriator or the landowner?
HELD: The TRB claims that there are two stages in expropriation proceedings, (1) the determination of the
authority to exercise eminent domain and (2) the determination of just compensation. The TRB argues that it
is only during the second stage when the court will appoint commissioners and determine claims for
entitlement to interest, citing Land Bank of the Philippines v. Wycocoand National Power Corporation v.
Angas.The TRB further points out that the expropriation account with LBP-South Harbor is not in the name of
HTRDC, but of DPWH. Thus, the said expropriation account includes the compensation for the other
landowners and does not exclusively belong to respondent.The said argument is without merit because it
failed to distinguish between the expropriations procedures under Republic Act No. 8974 and Rule 67
of the Rules of Court. Republic Act No. 8974 and Rule 67 of the Rules of Court speak of different
procedures, with the former specifically governing expropriation proceedings for national government
infrastructure projects.
x xxx
Rule 67 outlines the procedure under which eminent domain may be exercised by the Government. Yet by no
means does it serve at present as the solitary guideline through which the State may expropriate private
property. For example, Section 19 of the Local Government Code governs as to the exercise by local
government units of the power of eminent domain through an enabling ordinance. And then there is Rep. Act
No. 8974, which covers expropriation proceedings intended for national government infrastructure projects.
Rep. Act No. 8974, which provides for a procedure eminently more favorable to the property owner than Rule
67, inescapably applies in instances when the national government expropriates property ―for national
government infrastructure projects.‖ Thus, if expropriation is engaged in by the national government for
purposes other than national infrastructure projects, the assessed value standard and the deposit mode
prescribed in Rule 67 continues to apply.
There is no question that the proceedings in this case deal with the expropriation of properties intended for a
national government infrastructure project. Therefore, the RTC correctly applied the procedure laid out in
Republic Act No. 8974, by requiring the deposit of the amount equivalent to 100% of the zonal value of the
properties sought to be expropriated before the issuance of a writ of possession in favor of the Republic.
Whether the Court of Appeals was correct in holding that the interest earned by the deposited amount in the
expropriation account would accrue to HRTDC by virtue of accession, hinges on the determination of who
actually owns the deposited amount, since, under Article 440 of the Civil Code, the right of accession is
conferred by ownership of the principal property:
Art. 440. The ownership of property gives the right by accession to everything which is produced thereby, or
which is incorporated or attached thereto, either naturally or artificially.
The principal property in the case at bar is part of the deposited amount in the expropriation account of DPWH
which pertains particularly to HTRDC. Such amount, determined to be P22,968,000.00 of the P28,406,700.00
total deposit, was already ordered by the RTC to be released to HTRDC or its authorized representative. The
Court of Appeals further recognized that the deposit of the amount was already deemed a constructive
delivery. Since the Court of Appeals found that the HTRDC is the owner of the deposited amount, then the
latter should also be entitled to the interest which accrued thereon.
The critical factor in the different modes of effecting delivery which gives legal effect to the act is the actual
intention to deliver on the part of the party making such delivery. The intention of the TRB in depositing such
amount through DPWH was clearly to comply with the requirement of immediate payment in Republic Act No.
8974, so that it could already secure a writ of possession over the properties subject of the expropriation and
commence implementation of the project. In fact, TRB did not object to HTRDC‘s Motion to Withdraw Deposit
with the RTC, for as long as HTRDC shows (1) that the property is free from any lien or encumbrance and (2)
that respondent is the absolute owner thereof. TRB already complied therewith by depositing the required
amount in the expropriation account of DPWH with LBP-South Harbor. By depositing the said amount, TRB is
already considered to have paid the same to HTRDC, and HTRDC became the owner thereof. The amount
earned interest after the deposit; hence, the interest should pertain to the owner of the principal who is already
determined as HTRDC. The interest is paid by LBP-South Harbor on the deposit, and the TRB cannot claim
that it paid an amount more than what it is required to do so by law. Since the respondent is the owner of
P22,968,000.00, it is entitled by right of accession to the interest that had accrued to the said amount only.
The case at bar, however, does not involve interest as damages for delay in payment of just compensation. It
concerns interest earned by the amount deposited in the expropriation account. Under Section 4 of Republic
Act No. 8974, the implementing agency of the government pays just compensation twice: (1) immediately upon
the filing of the complaint, where the amount to be paid is 100% of the value of the property based on the
current relevant zonal valuation of the BIR (initial payment); and (2) when the decision of the court in the
determination of just compensation becomes final and executory, where the implementing agency shall pay the
owner the difference between the amount already paid and the just compensation as determined by the court
(final payment). As a final note, TRB does not object to HTRDC‘s withdrawal of the amount of P22,968,000.00
from the expropriation account, provided that it is able to show (1) that the property is free from any lien or
encumbrance and (2) that it is the absolute owner thereof. The said conditions do not put in abeyance the
constructive delivery of the said amount to HTRDC pending the latter‘s compliance therewith. Article 118752
of the Civil Code provides that the ―effects of a conditional obligation to give, once the condition has been
fulfilled, shall retroact to the day of the constitution of the obligation.‖ Hence, when HTRDC complied with the
given conditions, as determined by the RTC in its Orderdated 21 April 2003, the effects of the constructive
delivery retroacted to the actual date of the deposit of the amount in the expropriation account of DPWH.

5. BANK OF THE PHILIPPINE ISLANDS vs. COURT OF APPEALS, 441 SCRA 637
When a strict and literal application of the rules on non-forum shopping and verification will result in a patent
denial of substantial justice, they may be liberally construed. This guideline is especially true when the
petitioner has satisfactorily explained the lapse and fulfilled the requirements in its motion for reconsideration.
Before the Court is a Petition for Reviewunder Rule 45 of the Rules of Court, challenging the January 26, 2001
Resolution of the Court of Appeals (CA) in CA-GR SP No. 59858. The Resolution reads as follows:Up for
consideration is petitioners‘ motion for reconsideration of this Courts resolution of dismissal which was
promulgated on August 25, 2000. Taking note of the comment by the Office of the Solicitor General for the
public respondent on said motion, the same is hereby denied. The resolution of dismissal stands.Earlier, in its
August 25, 2000 Resolution,the CAresolved to DISMISS the above-entitled petition on the ground that the
verification was signed only by petitioners vice-president, sans any board resolution or power of attorney
authorizing anybody to sign the same and the certificate on non-forum shopping.
FACTS: On January 30, 1990, 49 workers filed a Complaintagainst Bank of the Philippine Islands (BPI) and
Diars Assistance, Inc. (Diar). Docketed as NLRC Case No. 00-01-00580-90, the Complaint was for the
Regularization of Work Status and Preliminary Injunction with Prayer for Restraining Order. Complainants
claimed that they were working in the respondent BPI performing clerical, messengerial and general utility work
as they [had] been assigned in the bank by their agency x xxDiars Assistance, Inc. In a Manifestation and
Motion filed on February 23, 1990 during the pendency of the case, the 49 workers prayed for the inclusion of
121 more as complainants after the latter had signified their intention to join the union. Thereafter, the
Complaint was amended and the name of the complainant changed to that of the organization, Diars
Employees Labor Union (BPI Unibank Chapter).The union prayed that the employment status of their
members be regularized and that BPI be ordered to absorb them as regular employees.In an Order dated July
18, 1991, Labor Arbiter Pablo C. Espiritu Jr. dismissed the Complaint. The dismissal was affirmed by the
NLRC and by this Court.On January 31, 1994, Diars Employees Labor Union, through NormandoBeguelme (its
president) and Jose Laron (a member), filed a new Complaint for the declaration of its members as regular
employees of BPI. The Complaint was docketed as NLRC NCR Case No. 00-01-00829-94. After Labor Arbiter
Potenciano S. Canizares Jr. dismissed the case for lack of merit,the union appealed to the NLRC. BPI and Diar
opposed the appeal and interposed forum shopping as one of their defenses.The NLRC (First Division) set
aside the labor arbiters Decision and declared complainants as regular employees of BPI. On the issue of
forum shopping, the NLRC ruled thus. A check with the record of this case did not show that the complainants
in the first case are the same complainants in this third case. Although the causes of action in the first case
and this third case are the same for the regularization of the members of complainant union there is no identity
of the parties involved. The second case is for injunction and the same is, therefore, not similar to this
case.Diar and BPI moved for a reconsideration. In its March 28, 2000 Order, the NLRC denied both
Motions: BPIs, for being filed beyond the reglementary period; and Diars, for lack of merit.Thereafter, BPI filed
with the appellate court a Petition for Certiorariunder Rule 65, assailing the NLRC Decision. As earlier stated,
the CA dismissed the recourse on the ground that the verification has been signed only by petitioners vice
president, without express authority from any board resolution or power of attorney.Presently before the CA is
a similar Petition (CA-GR SP No. 59093) filed by Diar, BPIs co-respondent.Hence this appeal.
ISSUES. Whether BPIs Petition before the CA should have been given due course; and (2) whether the
second regularization case is barred by res judicata.
HELD: First Issue:
The fact that respondent union commenced the case against BPI and Diar in a single Complaint is an
indication of the indispensability of both parties to the action. The Rules state that [p]arties in interest without
whom no final determination can be had of an action shall be joined either as plaintiffs or defendants.
In BA Finance Corporation v. CA,the Court explained:

x xx. An indispensable party is one whose interest will be affected by the court's action in the litigation, and
without whom no final determination of the case can be had. The party's interest in the subject matter of the
suit and in the relief sought are so inextricably intertwined with the other parties' that his legal presence as a
party to the proceeding is an absolute necessity. In his absence there cannot be a resolution of the dispute of
the parties before the court which is effective, complete, or equitable.

Without the presence of indispensable parties to a suit or proceeding, judgment of a court cannot attain real
finality.

In all stages of an action -- including those involved in motions for reconsideration, petitions for certiorari
and appeals -- the rule on joinder of indispensable parties must be extended, as long as such extension is
practicable and the reason for it, as explained above, subsists.The ultimate issue brought up for review in the
instant case is: who is the employer of the members of respondent labor union -- BPI, Diar or both? Moreover,
a review of the facts of the case reveals that (1) there is a service contract between BPI and Diar; (2) Diar pays
the salaries of the members of respondent union; and (3) the members of respondent union perform their tasks
in the premises of BPI.These facts reveal close factual and legal relationships among respondent union, BPI
and Diar -- relationships that are so inextricably intertwined that the issues raised in the Complaint cannot be
finally determined without considering the rights of all three parties. Thus, it is essential that when the case is
brought up for review to determine the real employer of the members of respondent labor union, all these
parties must be heard.

GREEN NOTES:
Just compensation in expropriation cases; value of the property when?
Just compensation is defined as the full and fair equivalent of the property taken from its owner by the
expropriator. The measure is not the taker‘s gain, but the owner‘s loss. Market value is that sum of money
which a person desirous but not compelled to buy, and an owner willing but not compelled to sell, would agree
on as a price to be given and received therefore.
The just compensation is determined as of the date of taking of the property or the filing of the complaint for
expropriation, WHICHEVER COMES FIRST.

6. FERNANDO GABATIN, JOSE GABATIN AND ALBERTO GABATIN vs. LAND BANK OF THE
PHILIPPINES, 444 SCRA 176
FACTS: Before Us is a petition for Review on Certiorari under Rule 45 of the Rules of Court seeking to set
aside the Decision and Resolution dated 15 September 2000 and 03 May 2001, respectively, of the Court of
Appeals in CA-G.R. CV No. 61240, entitled, Fernando Gabatin, Alberto Gabatin and Jose Gabatin, petitioners-
appellees v. Department of Agrarian Reform, respondent. The Decision set aside the order of the Special
Agrarian Court (SAC) dated 04 May 1998, and the Resolution denied petitioners motion for reconsideration.
Petitioners Fernando, Alberto, and Jose, all surnamed Gabatin, were registered owners of three parcels of
rice land situated in Sariaya, Quezon, under separate certificates of title, namely: Transfer Certificate of Title
(TCT) No. T-107863 (0.3965 hectare),[1] TCT No. T-107864 (1.4272 hectares)[2] and TCT No. T-107865
(1.4330 hectares).[3] In 1989, the properties, pursuant to the Land Reform Program of the Government as
defined under Presidential Decree (P.D.) No. 27[4] and Executive Order (E.O.) No. 228,[5] were placed by the
Department of Agrarian Reform (DAR) under its Operation Land Transfer (OLT). The properties were
distributed to deserving farmer beneficiaries through the issuance of emancipation patents.[6]
The formula prescribed under P.D. No. 27 and E.O. No. 228[7] for computing the Land Value (LV) of rice
lands is 2.5 x Average Gross Production (AGP) x Government Support Price (GSP). The AGP for the lots
covered under TCTs No. T-107863 and No. T-107864 was at 94.64 cavans per hectare while that of TCT No.
T-107865 was at 118.47.[8] The DAR and respondent Land Bank of the Philippines (Land Bank), fixed the GSP
at P35 which was the price of each cavan of palay in 1972, when the lots were deemed taken for distribution.
Petitioners rejected the valuation.
ISSUE:

FIRST: Is the special mode of appeal by petition for review from a decision of the Special Agrarian Court (SAC)
pursuant to Section 60 of R.A. 6657 still effective as the only mode of appeal from decisions of the SAC?

SECOND: May the Court of Appeals give due course to the appeal filed by a necessary party without being
joined by the indispensable party which did not appeal the decision?

THIRD: Whether just compensation in kind (palay) at the time of the taking of the properties shall be appraised
at the price of the commodity at the time of the taking or at the time it was ordered paid by the SAC?

HELD:

FIRST ISSUE: The motion for reconsideration dated October 16, 2002 and the supplement to the motion for
reconsideration dated November 11, 2002 are PARTIALLY GRANTED. While we clarify that the Decision of
this Court dated September 10, 2002 stands, our ruling therein that a petition for review is the correct mode of
appeal from decisions of Special Agrarian Courts shall apply only to cases appealed after the finality of this
Resolution.
Herein petitioners assailed the Resolution. It is the remonstration of the petitioners that since the notice of
appeal filed by respondent under Rule 41 was incorrect, the same did not stop the running of the reglementary
period to file a petition for review under Rule 42. The decision, therefore, of the SAC became final and
executory and, consequently, respondent had completely lost the remedy of appeal. In effect, petitioners
contended that the Resolution, when it prescribed for the prospective application of the Decision, took away
their vested rights to immediate payment of just compensation and created a second right to appeal in favor of
the respondent.
It is beyond cavil, therefore, that since this Court had already ruled on the prospective application of
the Land Bank v. De Leon decision, said issue must be laid to rest and must no longer be disturbed in this
decision. Stare decisiset non quietamovere.[25] Stand by the decisions and disturb not what is settled. It is a
very desirable and necessary judicial practice that when a court has laid down a principle of law as applicable
to a certain state of facts, it will adhere to that principle and apply it to all future cases where the facts are
substantially the same, absent any countervailing considerations.[26] An in-depth study of the case at bar clearly
shows that it does not fall under the exception of the stare decisis rule.
SECOND ISSUE: Petitioners find fault in the decision of the Court of Appeals which ruled that Land Bank has
the right to appeal on the ground that it is a necessary party. It is argued that DAR, being the only agency
authorized by law to represent the Republic of the Philippines in the acquisition of private agricultural lands for
agrarian reform, as stated under Section 51(1) of Republic Act No. 3844 and amended by Rep. Act No. 6389,
is an indispensable party in expropriation proceedings. Petitioners allege that Land Bank is only a necessary
party, thus, the Court of Appeals should have dismissed the appeal pursuant to MWSS v. Court of
Appeals[27] which states that when indispensable parties are not before the courts, the action should be
dismissed. Hence, petitioners concluded that the Court of Appeals acted without jurisdiction when it gave due
course and decided the appeal filed by Land Bank, a necessary party, without being joined by the DAR, the
indispensable party.
The Rules of Court provides that parties in interest without whom no final determination can be had of an
action shall be joined either as plaintiffs or defendants.[32] In BPI v. Court of Appeals,[33] this Court explained:
. . . An indispensable party is one whose interest will be affected by the courts action in the litigation, and
without whom no final determination of the case can be had. The partys interest in the subject matter of the suit
and in the relief sought are so inextricably intertwined with the other parties that his legal presence as a party
to the proceeding is an absolute necessity. In his absence there cannot be a resolution of the dispute of the
parties before the court which is effective, complete, or equitable.

Conversely, a party is not indispensable to the suit if his interest in the controversy or subject matter is distinct
and divisible from the interest of the other parties and will not necessarily be prejudiced by a judgment which
does complete justice to the parties in court. He is not indispensable if his presence would merely permit
complete relief between him and those already parties to the action or will simply avoid multiple litigation.

Without the presence of indispensable parties to a suit or proceeding, judgment of a court cannot attain real
finality. (emphasis supplied)It must be observed that once an expropriation proceeding for the acquisition of
private agricultural lands is commenced by the DAR, the indispensable role of Land Bank begins. There is
nothing in the Rules of Court that prohibits a party in an action before the lower court to make an appeal
merely on the ground that he is not an indispensable party. The Rules of Court does not distinguish whether
the appellant is an indispensable party or not. To avail of the remedy, the only requirement is that the person
appealing must have a present interest in the subject matter of the litigation and must be aggrieved or
prejudiced by the judgment.[38] A party, in turn, is deemed aggrieved or prejudiced when his interest,
recognized by law in the subject matter of the lawsuit, is injuriously affected by the judgment, order or
decree.[39] The fact that a person is made a party to a case before the lower court, and eventually be made
liable if the judgment be against him, necessarily entitles him to exercise his right to appeal. To prohibit such
party to appeal is nothing less than an outright violation of the rules on fair play.

THIRD ISSUE
The pith of the controversy is the determination of the GSP for one cavan of palay. Should the same be
based on the price at the time of taking or at the time of payment as ordered by the SAC?
It must be stressed, at the outset, that the taking of private lands under the agrarian reform program
partakes of the nature of an expropriation proceeding.[45] In a number of cases, we have stated that in
computing the just compensation for expropriation proceedings, it is the value of the land at the time of the
taking, not at the time of the rendition of judgment, which should be taken into consideration. [46] This being so,
then in determining the value of the land for the payment of just compensation, the time of taking should be the
basis. In the instant case, since the dispute over the valuation of the land depends on the rate of the GSP used
in the equation, it necessarily follows that the GSP should be pegged at the time of the taking of the properties.
In the instant case, the said taking of the properties was deemed effected on 21 October 1972, when the
petitioners were deprived of ownership over their lands in favor of qualified beneficiaries, pursuant to E.O. No.
228[47] and by virtue of P.D. No. 27. [48] The GSP for one cavan of palay at that time was at P35.[49] Prescinding
from the foregoing discussion, the GSP should be fixed at said rate, which was the GSP at the time of the
taking of the subject properties.The factual milieu of the case relied upon by petitioners is different from the
case at bar. In the case on hand, respondent insisted from the very start that the land valuation be based on
the GSP at the time of the taking - 1972. It stood firm on that ground. When SAC ordered Land Bank to pay
petitioners the land value based on the GSP at the time of payment, respondent vehemently disagreed and
questioned the valuation before the Court of Appeals. WHEREFORE, we DENY the instant petition. The
Decision of the Court of Appeals dated 15 September 2000 and its Resolution dated 03 May 2001 in CA-G.R.
CV No. 61240 are hereby AFFIRMED. No costs.SO ORDERED.

GREEN NOTES:
What is the basis of the just compensation for expropriation proceedings in connection with the agrarian reform
program of the government?
Held: The taking of private lands under the agrarian reform program of the government partakes of the nature
of an expropriation proceedings. As such, in computing the just compensation, it is the value of the land
at the time of the taking, not at the time of the rendition of the judgment, which should be taken into
consideration.

4. BASIS FOR JUST COMPENSATION

GREEN NOTES:
Who determines the just compensation in expropriation cases? What are the factors to be considered
in determining the same?

Determination of just compensation is a judicial function with the assistance or recommendation of the
court-appointed commissioners. (Manotok vs. CA, May 21,1987)

The factors to be considered in determining the just compensation/market value are:

1. cost of acquisition;
2. the current value of like proerties;
3. its actual or potential uses;
4. particular case of lands;
5. their size, shape, location; and
6. the tax declarations thereon.
Adjacent
Finally, note that as held in the case of Republic vs. Santos, 141 SCRA 30, the market value as
recommended by the board of commissioners appointed by the court were at best only ADVISORY AND
PERSUASIVE AND BY NO MEANS FINAL OR BINDING. (BERKENKOTTER, INC. VS. COURT OF
APPEALSAND REPUBLIC OF THE PHILIPPINES, December 14, 1992).
In case the government will not be able to use the land expropriated for the purpose for which it was
intended, may the landowner ask for its reversion to him?
Yes, provided he complies with the following: 1. Return the just compensation paid by the government;
2. pay the legal interest; 3. pay the necessary expenses incurred by the government in maintaining the lot; and
4. pay the pecuniary value of the services in managing it to the extent that the landowner will be benefited
thereby. (MACTAN CEBU INTERNATIONAL AIRPORT AUTHORITY VS. LOZADA, February 25, 2010)

1. HACIENDA LUISITA, INC vs. PRESIDENTIAL AGRARIAN REFORM COUNCIL, APRIL 24, 2012
FACTS: On July 5, 2011, the Supreme Court en banc voted unanimously (11-0) to DISMISS/DENY the petition
filed by HLI and AFFIRM with MODIFICATIONS the resolutions of the PARC revoking HLI‘s Stock Distribution
Plan (SDP) and placing the subject lands in Hacienda Luisita under compulsory coverage of the
Comprehensive Agrarian Reform Program (CARP) of the government.

The Court however did not order outright land distribution. Voting 6-5, the Court noted that there are operative
facts that occurred in the interim and which the Court cannot validly ignore. Thus, the Court declared that the
revocation of the SDP must, by application of the operative fact principle, give way to the right of the original
6,296 qualified farmworkers-beneficiaries (FWBs) to choose whether they want to remain as HLI stockholders
or [choose actual land distribution]. It thus ordered the Department of Agrarian Reform (DAR) to ―immediately
schedule meetings with the said 6,296 FWBs and explain to them the effects, consequences and legal or
practical implications of their choice, after which the FWBs will be asked to manifest, in secret voting, their
choices in the ballot, signing their signatures or placing their thumbmarks, as the case may be, over their
printed names.‖

The parties thereafter filed their respective motions for reconsideration of the Court decision.

ISSUES:
(1)Is the operative fact doctrine available in this case?

(2) Is Sec. 31 of RA 6657 unconstitutional?

(3) Can‘t the Court order that DAR‘s compulsory acquisition of Hacienda Lusita cover the full 6,443 hectares
allegedly covered by RA 6657 and previously held by Tarlac Development Corporation (Tadeco), and not just
the 4,915.75 hectares covered by HLI‘s SDP?

(4) Is the date of the ―taking‖ (for purposes of determining the just compensation payable to HLI) November 21,
1989, when PARC approved HLI‘s SDP?

(5) Has the 10-year period prohibition on the transfer of awarded lands under RA 6657 lapsed on May 10,
1999 (since Hacienda Luisita were placed under CARP coverage through the SDOA scheme on May 11,
1989), and thus the qualified FWBs should now be allowed to sell their land interests in Hacienda Luisita to
third parties, whether they have fully paid for the lands or not?

(6) THE CRUCIAL ISSUE: Should the ruling in the July 5, 2011 Decision that the qualified FWBs be given an
option to remain as stockholders of HLI be reconsidered?

HELD: The Court PARTIALLY GRANTED the motions for reconsideration of respondents PARC, et al. with
respect to the option granted to the original farmworkers-beneficiaries (FWBs) of Hacienda Luisita to remain
with petitioner HLI, which option the Court thereby RECALLED and SET ASIDE. It reconsidered its earlier
decision that the qualified FWBs should be given an option to remain as stockholders of HLI, and
UNANIMOUSLY directed immediate land distribution to the qualified FWBs.

1. YES, the operative fact doctrine is applicable in this case.The Court maintained its stance that the
operative fact doctrine is applicable in this case since, contrary to the suggestion of the minority, the doctrine is
not limited only to invalid or unconstitutional laws but also applies to decisions made by the President or the
administrative agencies that have the force and effect of laws. Prior to the nullification or recall of said
decisions, they may have produced acts and consequences that must be respected. It is on this score that the
operative fact doctrine should be applied to acts and consequences that resulted from the implementation of
the PARC Resolution approving the SDP of HLI. The majority stressed that the application of the operative fact
doctrine by the Court in its July 5, 2011 decision was in fact favorable to the FWBs because not only were they
allowed to retain the benefits and homelots they received under the stock distribution scheme, they were also
given the option to choose for themselves whether they want to remain as stockholders of HLI or not.

2. NO, Sec. 31 of RA 6657 NOT unconstitutional. The Court maintained that the Court is NOT compelled to
rule on the constitutionality of Sec. 31 of RA 6657, reiterating that it was not raised at the earliest opportunity
and that the resolution thereof is not the lismota of the case. Moreover, the issue has been rendered moot and
academic since SDO is no longer one of the modes of acquisition under RA 9700. The majority clarified that in
its July 5, 2011 decision, it made no ruling in favor of the constitutionality of Sec. 31 of RA 6657, but found
nonetheless that there was no apparent grave violation of the Constitution that may justify the resolution of the
issue of constitutionality.

3. NO, the Court CANNOT order that DAR’s compulsory acquisition of Hacienda Lusita cover the full
6,443 hectares and not just the 4,915.75 hectares covered by HLI’s SDP.Since what is put in issue before
the Court is the propriety of the revocation of the SDP, which only involves 4,915.75 has. of agricultural land
and not 6,443 has., then the Court is constrained to rule only as regards the 4,915.75 has. of agricultural land.
Nonetheless, this should not prevent the DAR, under its mandate under the agrarian reform law, from
subsequently subjecting to agrarian reform other agricultural lands originally held by Tadeco that were
allegedly not transferred to HLI but were supposedly covered by RA 6657.

However since the area to be awarded to each FWB in the July 5, 2011 Decision appears too restrictive –
considering that there are roads, irrigation canals, and other portions of the land that are considered
commonly-owned by farmworkers, and these may necessarily result in the decrease of the area size that may
be awarded per FWB – the Court reconsiders its Decision and resolves to give the DAR leeway in adjusting
the area that may be awarded per FWB in case the number of actual qualified FWBs decreases. In order to
ensure the proper distribution of the agricultural lands of Hacienda Luisita per qualified FWB, and considering
that matters involving strictly the administrative implementation and enforcement of agrarian reform laws are
within the jurisdiction of the DAR, it is the latter which shall determine the area with which each qualified FWB
will be awarded.

On the other hand, the majority likewise reiterated its holding that the 500-hectare portion of Hacienda Luisita
that have been validly converted to industrial use and have been acquired by intervenors Rizal Commercial
Banking Corporation (RCBC) and Luisita Industrial Park Corporation (LIPCO), as well as the separate 80.51-
hectare SCTEX lot acquired by the government, should be excluded from the coverage of the assailed PARC
resolution. The Court however ordered that the unused balance of the proceeds of the sale of the 500-hectare
converted land and of the 80.51-hectare land used for the SCTEX be distributed to the FWBs.

4. YES, the date of “taking” is November 21, 1989, when PARC approved HLI’s SDP. For the purpose of
determining just compensation, the date of ―taking‖ is November 21, 1989 (the date when PARC approved
HLI‘s SDP) since this is the time that the FWBs were considered to own and possess the agricultural lands in
Hacienda Luisita. To be precise, these lands became subject of the agrarian reform coverage through the
stock distribution scheme only upon the approval of the SDP, that is, on November 21, 1989. Such approval is
akin to a notice of coverage ordinarily issued under compulsory acquisition. On the contention of the minority
(Justice Sereno) that the date of the notice of coverage [after PARC‘s revocation of the SDP], that is, January
2, 2006, is determinative of the just compensation that HLI is entitled to receive, the Court majority noted that
none of the cases cited to justify this position involved the stock distribution scheme. Thus, said cases do not
squarely apply to the instant case. The foregoing notwithstanding, it bears stressing that the DAR's land
valuation is only preliminary and is not, by any means, final and conclusive upon the landowner. The
landowner can file an original action with the RTC acting as a special agrarian court to determine just
compensation. The court has the right to review with finality the determination in the exercise of what is
admittedly a judicial function.

5. NO, the 10-year period prohibition on the transfer of awarded lands under RA 6657 has NOT lapsed
on May 10, 1999; thus, the qualified FWBs should NOT yet be allowed to sell their land interests in
Hacienda Luisita to third parties. Under RA 6657 and DAO 1, the awarded lands may only be transferred or
conveyed after 10 years from the issuance and registration of the emancipation patent (EP) or certificate of
land ownership award (CLOA). Considering that the EPs or CLOAs have not yet been issued to the qualified
FWBs in the instant case, the 10-year prohibitive period has not even started. Significantly, the reckoning point
is the issuance of the EP or CLOA, and not the placing of the agricultural lands under CARP coverage.
Moreover, should the FWBs be immediately allowed the option to sell or convey their interest in the subject
lands, then all efforts at agrarian reform would be rendered nugatory, since, at the end of the day, these lands
will just be transferred to persons not entitled to land distribution under CARP.

6. YES, the ruling in the July 5, 2011 Decision that the qualified FWBs be given an option to remain as
stockholders of HLI should be reconsidered. The Court reconsidered its earlier decision that the qualified
FWBs should be given an option to remain as stockholders of HLI, inasmuch as these qualified FWBs will
never gain control [over the subject lands] given the present proportion of shareholdings in HLI. The Court
noted that the share of the FWBs in the HLI capital stock is [just] 33.296%. Thus, even if all the holders of this
33.296% unanimously vote to remain as HLI stockholders, which is unlikely, control will never be in the hands
of the FWBs. Control means the majority of [sic] 50% plus at least one share of the common shares and other
voting shares. Applying the formula to the HLI stockholdings, the number of shares that will constitute the
majority is 295,112,101 shares (590,554,220 total HLI capital shares divided by 2 plus one [1] HLI share). The
118,391,976.85 shares subject to the SDP approved by PARC substantially fall short of the 295,112,101
shares needed by the FWBs to acquire control over HLI.

2. City of Iloilo vs. Judge Sesana

*Case not found

 3. NATIONAL POWER CORPORATION vs TERESITA DIATO-BERNAL, December 15, 2010
FACTS: Respondent TeresitaDiato-Bernal is the registered owner of a parcel of land. In order to complete the
construction of structures and steel posts for NAPOCORs Dasmaris-Zapote 230 KV Transmission Line Project,
it had to acquire an easement of right of way over respondents property. NAPOCOR filed an expropriation suit
against respondent, alleging,interalia,that: the project is for public purpose; NAPOCOR negotiated with
respondent for the price of the property, as prescribed by law, but the parties failed to reach an agreement; and
NAPOCOR is willing to deposit the amount representing the assessed value of the property for taxation
purposes.
With the first phase of the expropriation proceedings having been laid to rest by the partial compromise
agreement, the RTC proceeded to determine the amount of just compensation. To assist in the evaluation of
the fair market value of the subject property, the RTC appointed three (3) commissioners,viz.:(1) the Provincial
Assessor of Cavite; (2) the Municipal Assessor of Imus,Cavite, upon recommendation of NAPOCOR; and (3)
Soledad Zamora, respondents representative.The commissioners submitted their report to the RTC on
September 14, 1999. In the main, they recommended that the just compensation due from NAPOCOR be
pegged atP10,000.00 per sq m, based on the propertys fair market value.
NAPOCOR filed an Oppositionto the Commissioners Valuation Report, asserting that it was not substantiated
by any official documents or registered deeds of sale of the subject propertysneighboring lots. The RTC issued
an Order adopting the recommendation of the commissioners. On appeal, the CA rendered its Decision
affirming the RTCs judgment.
ISSUE: Whether or not the CA erred in relying on the unsubstantiated and insufficient findings contained in the
commissioners report.
HELD: Court of Appeals decision is reversed.
The CA and the RTC erred in relying on the unsubstantiated and insufficient findings contained in the
commissioners report. First, the market values of the subject propertysneighboring lots were mere estimates
and unsupported by any corroborative documents, such as sworn declarations of realtors in the area
concerned, tax declarations or zonal valuation from the Bureau of Internal Revenue for the contiguous
residential dwellings and commercial establishments. The report also failed to elaborate on how and by how
much the community centers and convenience facilities enhanced the value of respondents property. Finally,
the market sales data and price listings alluded to in the report were not even appended thereto. As correctly
invoked by NAPOCOR, a commissioners report of land prices which is not based on any documentary
evidence is manifestly hearsay and should be disregarded by the court. The trial court adopted the flawed
findings of the commissioners hook, line, and sinker. It did not even bother to require the submission of the
alleged market sales data and price listings. Further, the RTC overlooked the fact that the recommended just
compensation was gauged as of September 10, 1999 or more than two years after the complaint was filed on
January 8, 1997. It is settled that just compensation is to be ascertained as of the time of the taking, which
usually coincides with the commencement of the expropriation proceedings. Where the institution of the action
precedes entry into the property, the just compensation is to be ascertained as of the time of the filing of the
complaint. Clearly, the recommended just compensation in the commissioner‘s report is unacceptable.
Just compensation is defined as the full and fair equivalent of the property taken from its owner by the
expropriator.The measure is not the takers gain, but the owners loss.The word just is used to intensify the
meaning of the word compensation and to convey thereby the idea that the equivalent to be rendered for the
property to be taken shall bereal, substantial, full, and ample. Indeed, the just-ness of the compensation can
only be attained by using reliable and actual data as bases in fixing the value of the condemned property.
The trial court should have been more circumspect in its evaluation of just compensation due the property
owner, considering that eminent domain cases involve the expenditure of public funds. Hence, the legal basis
for the determination of just compensation being insufficient, the ruling of the RTC and the affirming Decision
and Resolution of the CA ought to be set aside.
 The petition for review on certiorari is GRANTED.

4. NATIONAL POWER CORPORATION vs. HON. ENRIQUE T. JOCSON, February 25, 1992
FACTS: The petitioner files a special civil action for certiorari to annul the order issued by respondent judge in
violation of deprivation of the right of the petitioner for
due process. The petitioner filed 7 eminent domain cases in theacquisition of right of way easement over 7 parcels of
land in relation to the necessity of building towers and transmission line for the common good with the offer of corresponding
compensation to landowners affected with the expropriation process. However, both parties did not come to an
agreement on just compensation thereby prompting petitioner to bring theeminent domain case. Respondent judge
found existing paramount public interest for the expropriation and therebyissued an order determining the
provisional market value of the subject areas based on tax declaration of the properties.
The petitioner, incompliance to the order of respondent judge,deposited corresponding amount of the assessed value
of said lands in the amount of P23,180,828.00 with the
Philippine National Bank. Respondents land owners filed motion forreconsideration asserting that the assessed
value is way too low and that just compensation due them is estimated as P29,970,000.00. Immediately the following day,
respondent judge increased the provisional value to that stated in the motion for reconsideration and ordered
petitioner to deposit the differential amount within 24 hours from receipt of order while holding in abeyance the
writ of possession order pending compliance to said order which the petitioner immediately complied. Thereafter,
respondent judge ordered petitioner to pay in full amount the defendants for their expropriated property.
Petitioner assailed such order to be in violation of due process and abuse of discretion on the part of
the respondent judge hence this petition. Issue: W/N the respondent judge acted in grave abuse of discretion and whether or
not the petitioner was deprived of due process of law.

HELD: The court ruled that PD No. 42 provides that upon filing in court complaints on eminent domain proceeding and after
due notice to the defendants, plaintiff will have the right to take possession of the real property upon deposit of the
amount of the assessed value with PNB to be held by the bank subject to orders and final disposition of the
court. The respondent judge failed to observe this procedure by failure to issue the writ of possession to the petitioner
despite its effort to deposit the amount in compliance to the mandate of law. Furthermore, the respondent judge erred in
increasing the provisional value of properties without holding any hearing for both parties. The instant petition
was granted by the court setting aside the temporary restraining order and directing respondent judge to
cease and desist from enforcing his orders. There are 2stages in the action of expropriation:1. 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.2. 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 whose findings are deemed to be final.

5. JOSE MA. ANSALDO vs. FRANCISCO S. TANTUICO, JR., August 3, 1990

FACTS: Two lots of private ownership were taken by the Government and used for the widening of a road more than forty-three
years ago, without benefit of an action of eminent domain or agreement with its owners, albeit without protest by the latter. The lots
belong to the petitioners, Jose Ma. Ansaldo and Maria Angela Ansaldo, are covered by title in their names and have an
aggregate area of 1,041 square meters. These lots were taken from the Ansaldos sometime in 1947 by the Department of Public
Work Transportation and Communication and made part of what used to be Sta. Mesa Street and is now Ramon Magsaysay
Avenue at San Juan, Metro Manila. Said owners made no move whatever until twenty-six years later. They wrote to ask
for compensation for their land on January 22, 1973.

Their claim was referred to the Secretary of Justice who in due course rendered an opinion dated February 22, 1973, that just
compensation should be paid in accordance with Presidential Decree No. 76.The Commission on Audit, however, declined to
adopt the recommendation. In a decision handed down on September 26, 1973. The Acting Chairman ruled that "the amount of
compensation to be paid to the claimants is to be determined as of the time of the taking of the subject lots.

ISSUE: whether or not just compensation should be fixed as of the time of actual taking of possession by the expropriating entity
or only after conveyance of title to the expropriator pursuant to expropriation proceedings duly instituted
HELD: In the context of the State's inherent power of eminent domain, there is a "taking" when the owner is actually deprived or
dispossessed of his property; when there is a practical destruction or a material impairment of the value of his property or when he
is deprived of the ordinary use thereof. There is a "taking" in this sense when the expropriator enters private property not only for a
momentary period but for a more permanent duration, for the purpose of devoting the property to a public use in such a manner as
to oust the owner and deprive him of all beneficial enjoyment thereof. Clearly, then, the value of the Ansaldos' property must be
ascertained as of the year 1947, when it was actually taken, and not at the time of the filing of the expropriation suit, which, by the
way, still has to be done. The value, once fixed, shall earn interest at the legal rate until full payment is effected, conformably with
other principles laid down by case law.

6. MUNICIPALITY OF MAKATI vs COURT OF APPEALS, October 1, 1990

FACTS: Petitioner Municipality of Makati expropriated a portion of land owned by private respondent Admiral
Finance Creditors Consortium, Inc. After hearing, the RTC fixed the appraised value of the property at
P5,291,666.00, and ordered petitioner to pay this amount minus the advanced payment of P338,160.00 which
was earlier released to private respondent. It then issued the corresponding writ of execution accompanied
with a writ of garnishment of funds of the petitioner which was deposited in PNB. Petitioner filed a motion for
reconsideration, contending that its funds at the PNB could neither be garnished nor levied upon execution, for
to do so would result in the disbursement of public funds without the proper appropriation required under the
law. The RTC denied the motion. CA affirmed; hence, petitioner filed a petition for review before the SC.

ISSUE:
1. Are the funds of the Municipality of Makati exempt from garnishment and levy upon execution?
2. If so, what then is the remedy of the private respondents?

HELD:

1. Yes. In this jurisdiction, well-settled is the rule that public funds are not subject to levy and execution, unless
otherwise provided for by statute. More particularly, the properties of a municipality, whether real or personal,
which are necessary for public use cannot be attached and sold at execution sale to satisfy a money judgment
against the municipality. Municipal revenues derived from taxes, licenses and market fees, and which are
intended primarily and exclusively for the purpose of financing the governmental activities and functions of the
municipality, are exempt from execution. Absent a showing that the municipal council of Makati has passed an
ordinance appropriating from its public funds an amount corresponding to the balance due under the RTC
decision, no levy under execution may be validly effected on the public funds of petitioner.

2. Nevertheless, this is not to say that private respondent and PSB are left with no legal recourse. Where a
municipality fails or refuses, without justifiable reason, to effect payment of a final money judgment rendered
against it, the claimant may avail of the remedy of mandamus in order to compel the enactment and approval
of the necessary appropriation ordinance, and the corresponding disbursement of municipal funds therefor.

For three years now, petitioner has enjoyed possession and use of the subject property notwithstanding its
inexcusable failure to comply with its legal obligation to pay just compensation. Petitioner has benefited from its
possession of the property since the same has been the site of Makati West High School since the school year
1986-1987. This Court will not condone petitioner's blatant refusal to settle its legal obligation arising from
expropriation proceedings it had in fact initiated. The State's power of eminent domain should be exercised
within the bounds of fair play and justice. (Municipality of Makati vs. CA, G.R. Nos. 89898-99, October 1, 1990)

7. REPUBLIC vs INTERMEDIATE APPELLATE COURT, 185 SCRA 572

FACTS: The property involved consists of four (4) parcels of land with a total area of 9,650 square meters
located at No. 2090 Dr. Manuel L. Carreon Street, Manila, a short walking distance from Herran (now Pedro
Gil) Street. Its previous owner, Avegon Inc., offered it for sale to the City School Board of Manila on July 21,
1973 at P2,300,000. The school board was willing to buy at P1,800,000 but the then Mayor of Manila
intervened and volunteered to negotiate with Avegon Inc. for a better price. Inasmuch as the alleged
negotiation did not materialize, on June 3, 1974, Avegon Inc. sold the property and its improvements to
Amerex Electronics, Phils. Corporation (Amerex for brevity) for P1,800,000. Thereafter, Transfer Certificates of
Title Nos. 115571, 115572, 115573 and 115574 were issued in favor of Amerex. On August 29, 1975, the
Solicitor General filed for the Department of Education and Culture (DEC) a complaint against Amerex for the
expropriation of said property before the Court of First Instance of Manila (Civil Case No. 99190). The
complaint stated that the property was needed by the government as a permanent site for the Manuel de la
Fuente High School (later renamed Don Mariano Marcos Memorial High School); that the fair market value of
the property had been declared by Amerex as P2,435,000, and that the assessor had determined its market
value as P2,432,042 and assessed it for taxation purposes in the amount of P1,303,470.1

Amerex filed a motion to dismiss the complaint stating that while it was not contesting the merits of the
complaint, the same failed to categorically state the amount of just compensation for the property. It therefore
prayed that in consonance with P.D. No. 794, the just compensation be fixed at P2,432,042, the market value
of the property determined by the assessor which was lower than Amerex's own declaration.

Alleging that its motion to dismiss merely sought a clarification on the just compensation for the property,
Amerex filed a motion to withdraw the plaintiffs deposit of P1,303,470 with the PNB without prejudice to its
entitlement to the amount of P1,128,572, the balance of the just compensation of P2,432,042 insisted upon.
The plaintiff interposed no objection to the motion provided that an order of condemnation be issued by the
court and that the plaintiff be allowed to present its evidence on the matter of just compensation.

On March 12, 1976, the plaintiff filed a motion for leave of court to amend its complaint stating that after it had
filed the same, P.D. No. 464 2 was amended by P.D. No. 794; that Section 92 of said Code, as amended,
provided that when private property is acquired for public use, its just compensation "shall not exceed the
market value declared by the owner or administrator or anyone having legal interest in the property, or such
market value as determined by the assessor, whichever is lower"; and that the amended complaint would state
that the fair market value of the property could not be in excess of P1,800,000, the amount for which
defendant's predecessor-in-interest had offered to sell said properties to the Division of Public Schools of
Manila and which amount was also the purchase price paid by Amerex to Avegon Inc. In due course, plaintiff
filed an amended complaint.

Both parties objected to the report of the commissioners. The plaintiff contended that the commissioners'
conclusion that the fair market value of the property was P2,763,400 was unsupported by evidence and that
their recommended just compensation of P2,258,018.57 was excessive. It reiterated its stand that the just
compensation should only be P1,800,000 it being the price had the sale between the city school board and
Avegon Inc. materialized and also the actual price of the sale between Avegon Inc. and Amerex. On the other
hand, Amerex averred that the recommended just compensation was unjustified in view of the commissioners'
finding that the fair market value of the property was P2,763,400.

The plaintiff elevated the case to the then Intermediate Appellate Court (IAC) for review. On October 29, 1984,
it affirmed the appealed decision with the modification that the plaintiff Republic of the Philippines be exempted
from the payment of the commissioners' fees, the P500.00 granted each of them for the preparation of the
report and the costs.

ISSUE: Whether or not respondent Court erred in totally disregarding petitioner's evidence showing that the
award of just compensation should be only P1,800,000.00 and not P2,258.018.57 as awarded by said
respondent Court.

HELD: The determination of just compensation for a condemned property is basically a judicial function. As the
court is not bound by the commissioners' report, it may make such order or render such judgment as shall
secure to the plaintiff the property essential to the exercise of its right of condemnation, and to the defendant
just compensation for the property expropriated. For that matter, this Court may even substitute its own
estimate of the value as gathered from the record. 11 Hence, although the determination of just compensation
appears to be a factual matter which is ordinarily outside the ambit of its jurisdiction, this Court may disturb the
lower court's factual finding on appeal when there is clear error or grave abuse of discretion. 12
We hold that the courts below made an erroneous determination of just compensation in this case.

In the first place, the just compensation prescribed herein is based on the commissioners' recommendation
which in turn is founded on the "audited" statements of Amerex that the property is worth P2,258,018.57. As
earlier pointed out, while the court may accept the commissioners' report and render judgment in accordance
therewith, it may not do so without considering whether the report is supported by evidence. The court is also
duty-bound to determine whether the commissioners had discharged the trust reposed in them according to
well-established rules and formed their judgment upon correct legal principles for they are not supposed to
act ad libitum .13

This Court having declared as unconstitutional the mode of fixing just compensation under P.D. No. 794 20 just
compensation should be determined either at the time of the actual taking of the government or at the time of
the judgment of the court, whichever comes first. 21

In this case, the issuance of the condemnation order and the actual taking of the property both occurred in
October, 1975. Accordingly, the appraisal made by Ampil Realty and Appraisal Co., Inc. on June 5, 1975,
which date is nearest to that of the actual taking of the property, should be the basis for the determination of
just compensation the record being bereft of any indications of anomaly appertaining thereto. It should be
added that WenceslaoAmpil, the president of said appraisal firm, testified at the trial and therefore petitioner
had the opportunity to confront him and to question his report. The reasonableness of the June 5,1975
appraisal fixing at P2,400,000 the fair market value of the property, is bolstered by the fact that on June 4,
1975, Traders Commodities Corporation, through its lawyer, Sedfrey A. Ordoñez offered to buy the property at
P2,750,000. 22 It must be emphasized, however, that legal interest on the balance of the just compensation of
P2,400,000 after deducting the amount of P1,303,470 which had been delivered to Amerex, should be paid by
petitioner from the time the government actually took over the propert y. 23

Much as we realize the need of the government, under these trying times, to get the best possible price for the
expropriated property considering the ceaseless and continuing necessity for schools, we cannot agree with
the petitioner that the just compensation for the property should be the price it commanded when it was first
offered for sale to the City School Board of Manila. Petitioner failed to substantiate its claim that the property is
worth the lower amount of P1,800,000. In contrast, Amerex submitted evidence consisting of the aforesaid
June 5, 1975 appraisal report which fixed the fair market value of the property at P2,400,000.

WHEREFORE, the just compensation of the property expropriated for the use of the Manuel de la Fuente High
School Don Mariano Marcos Memorial High School) is hereby fixed at Two Million Four Hundred Thousand
Pesos (P2,400,000.00). After deducting the amount of P1,303,470.00 therefrom, the petitioner shall pay the
balance with legal interest from October 13, 1975.

8. MUNICIPALITY OF TALISAY vs. SPOUSES HILARIO RAMIREZ and ERLINDA RAMIREZ and
SPOUSES WILLIAM ABARQUEZ and JOSEPHINE ABARQUEZ, 183 SCRA 528

FACTS: Municipality of Talisay, in Cebu, filed a complaint for the expropriation of two lots belonging to the
private respondents. Judge Valeriano P. Tomol, Jr. of the RTC of Cebu denied the defendants' motion to
dismiss, after hearing, and issued a writ of possession in favor of the plaintiff. The court ordered the parties to
designate three commissioners each to assist it in fixing the just compensation for the condemned properties.
Subsequently, the plaintiff not having complied, the respondent judge issued an order dismissing the complaint
pursuant to Rule 17, Section 3, of the Rules of Court. In a motion for reconsideration, the plaintiff, while
maintaining that the order of dismissal was invalid and praying that it be recalled, nevertheless submitted the
names of its three recommendees. The motion was denied on the ground that the new administration of the
plaintiff had not "passed a resolution signifying its adoption of the expropriation sought in this case," although
the order was amended "by making the dismissal as being without prejudice." Private respondents contested
that the new government of the Municipality of Talisay was not pursuing that act taken by its predecessors,
besides the fact that the just compensation for the condemned properties could no longer be fixed in
accordance with the several presidential decrees invoked by the petitioner. Sangguniang Bayan of Talisay,
sent a copy manifesting to the Court the intention of the government of theMunicipality of Talisay to continue
with the expropriation of the subject lots.

The petitioner maintains that it was not under obligation to submit the names of three commissioners to assist
in the determination of the just compensation for the condemned properties,It argues that it is the duty of the
court alone under Rule 67, Section 5, of the Rules of Court. Moreover, the just compensation is no longer fixed
by commissioners under the said Rule as this has been repealed by P.D. Nos. 42, 76, 464, 794, 1224, 1259,
1313, 1517, and 1533. These decrees provide that the just compensation in expropriation cases shall be the
value given to the condemned property by either the owner thereof or the government assessor, whichever
valuation is lower.

HELD: The rule laid down in these decrees is no longer controlling, having been declared unconstitutional in
the landmark case of Export Processing Zone Authority v. Dulay. It was held that the method of ascertaining
just compensation under the decrees constitutes impermissible encroachment on judicial prerogatives. It tends
to render this Court inutile in a matter which under the Constitution is reserved to it for final determination.Thus,
although in an expropriation proceeding the court technically would still have the power to determine the just
compensation for the property, following the applicable decrees, its task would be relegated to
simply stating the lower value of the property as declared either by the owner or the assessor.As a necessary
consequence, it would be useless for the court to appoint commissioners under Rule 67 of the Rules of Court.
With this decision, the rules for determining just compensation as laid down in Rule 67 of the Rules of Court
have been reactivated and are again applicable. Hence, the petitioner cannot continue arguing that
commissioners are no longer necessary to assist the court in determining the just compensation for the
properties it seeks to expropriate. While it is true that, strictly speaking, it is the court that shall appoint the said
commissioners, there is nothing to prevent it from seeking the recommendations of the parties on this matter,
the better to ensure their fair representation. Indeed, the petitioner should have welcomed the chance to
submit their three recommendees instead of peevishly questioning the well-meaning order of the respondent
judge.

ADJUDICATION:The Orders of the respondent court are SET ASIDE and Civil Case in the RTC of Cebu is
REINSTATED for hearing and decision in accordance with Rule 67 of the Rules of Court.

9. NATIONAL POWER CORPORATION v. THE COURT OF APPEALS; B.E. SAN DIEGO, INC., 129 SCRA
665

CONSTITUTIONAL LAW; EMINENT DOMAIN; JUST COMPENSATION; PRICE OR VALUE OF THE

PROPERTY AT THE TIME OF TAKING, BASIS FOR JUST COMPENSATION. — It is now settled doctrine,
following the leading case of Alfonso v. Pasay (106 Phil. 1017 [1960]), that to determine due compensation for
lands appropriated by the Government, the basis should be the price or value at the time it was taken from the
owner and appropriated by the Government.

FACTS: In 1961, NPC commenced negotiations with the spouses Esteban Sadang and Maria Lachica, then
the registered owners, for the purchase of a portion of 8,746 sq. ms. of the latter‘s parcel of land of 62,285 sq.
ms, situated in Barrio San Mateo, Norzagaray, Bulacan, for the purpose of constructing an access road to its
Angat River Hydroelectric Project. Although the negotiations were not yet concluded, NPC nevertheless
obtained permission from said spouses to begin construction of the access road, which it did in November
1961.On1962, B. E. San Diego, Inc. a realty firm and private respondent acquired the parcel of land at a public
auction sale and was issued a title. On 1963, NPC instituted proceedings for eminent domain against the
spouses Sadang in the CFI of Bulacan, later amended with leave of Court, to implead SAN DIEGO. Trial Court
appointed three Commissioners, one for each of the parties and another for the Court, to receive the evidence
and determine the just compensation to be paid for the property sought to be expropriated. The trial court
rendered decision declaring to plaintiff the full and legal right to acquire by eminent domain the absolute
ownership over the portion of the land and authorizing the payment by plaintiff to defendant of the amount of
P31,922.00 as full indemnity for the property at the rate of P3.75 per square meter, with interest at 12% per
annum from March 11, 1963 until fully paid.Both parties appealed to the CA. The CA held that the just and
reasonable compensation for the property in question is P7.00 per square meter. SAN DIEGO did not appeal
from the Appellate Court judgment although it filed a Brief.

ISSUE: Whether the CA erred in fixing the amount oof P7.00 per square meter as just compensation for the
portion of land sought to be expropriated based on its planned convertibility into a residential subdivision

HELD: On the issue of just compensation, it is now settled doctrine, following the leading case of Alfonso v.
Pasay, that to determine due compensation for lands appropriated by the Government, the basis should be the
price or value at the time it was taken from the owner and appropriated by the Government.

"The owner of property expropriated by the State is entitled to how much it was worth at the time of the taking.
This has been clarified in Republic v. PNB (1 SCRA 957) thus: ‗It is apparent from the foregoing that, when
plaintiff takes possession before the institution of the condemnation proceedings, the value should be fixed as
of the time of the taking of said possession, not of filing of the complaint, and that the latter should be the basis
for the determination of the value, when the taking of the property involved coincides with or is subsequent to,
the commencement of the proceedings. Indeed, otherwise, the provision of Rule 69, section 3, directing that
compensation ‗be determined as of the date of the filing of the complaint‘ would never be operative." 3

In the case at bar, the taking by NPC occurred in November 1961, when it constructed the access road
on the expropriated property at time when it was still "cogonal" and owned by the spouses Sadang.
The Complaint was filed only in 1963.

The convertibility of the property into a subdivision, the criterion relied upon by respondent Court, is
not controlling. The case of Manila Electric Co. v. Tuason, 60 Phil. 663, 668, cited in Municipal Gov‘t. of
Sagay v. Jison, has categorically ruled that it is the time of taking and not as "potential building" site that is the
determining factor,". . . if the property to be expropriated was agricultural, the adaptability thereof for
conversion in the future into a residential site does not affect its nature when plaintiff assumed possession of
the property, although it is a circumstance that should be considered in determining its value at that time, as an
‗agricultural‘ land."

Since SAN DIEGO bought the land in question in the interim and was issued a title only on December 7, 1962,
the "taking" as to it should commence only from said date.

ADJUDICATION:The judgment of respondent Appellate Court is hereby set aside, and the Decision of the then
Court of First Instance of Bulacanauthorizing payment of P31,922.00 as full indemnity for the property at the
rate of P3.75 per square meter is reinstated. Petitioner is directed to pay interest at six per cent (6%) per
annum on the amount adjudged from December 7, 1962, until fully paid.

10. DOMINGO B. MADDUMBA and ANITA C. MADDUMBA vs. GOVERNMENT SERVICE INSURANCE
SYSTEM, 182 SCRA 281

FACTS: Respondent GSIS conducted a public bidding of several foreclosed properties, including a house and
lot. The petitioner participated and submitted his bid. It bid was subject to a down payment of 35% of the
amount thereof, the 10% constituting the proposal bond with the remaining 25% to be paid after the receipt of
the notice of award or acceptance of the bid. Accordingly, petitioner enclosed with his sealed bid a manager's
and cash to complete the proposal bond. Upon the receipt of the notice of award, petitioner offered to pay the
additional 25% in Land Bank bonds at their face value. These bonds were issued to petitioner as payment for
his riceland acquired by the Government from him. However, the GSIS rejected the offer, hence it was
withdrawn by petitioner. Petitioner then offered to pay in cash the balance of the required down payment.
When the second monthly installment became due, petitioner sent a letter to the GSIS Board of Trustees
requesting that he be allowed to pay with his Land Bank bonds. Petitioner invoked the provisions of Section 85
of Republic Act No. 3844, as amended by Presidential Decree No. 251. The GSIS Board of Trustees denied
petitioner's offer and "resolved to reiterate the policy that Land Bank bonds shall be accepted as payment only
at a discounted rate to yield the System 18% at maturity." The petitioner asked the Board to reconsider and
them submitted an opinion of the Ministry of Agrarian Reform, wherein it was stated that "if the GSIS accepts
the Land Bank bonds as payment thereof, it must accept the same at par or face value.

ISSUE: Whether the provisions of Section 85 of Republic Act No. 3844, as amended by Presidential Decree
No. 251, the GSIS may be compelled to accept Land Bank bonds at their face value in payment for a
residential house and lot purchased by the bondholder from the GSIS.

HELD: Respondent Government Service Insurance System is ordered to accept the bonds issued by the Land
Bank of the Philippines at their par or face value. A government-owned or controlled corporation, like the GSIS,
is compelled to accept Land Bank bonds as payment for the purchase of its assets. As a matter of fact, the
bidder who offers to pay in bonds of the Land Bank is entitled to preference. Respondent's arguments
disregard the fact that the provisions of Section 85 are primarily designed to cushion the impact of
dispossession. This, of course, is in addition to the fact that, in case of expropriation of land covered by land
reform, the landowner will seldom get the compensation he desires. Thus, discounting the Land Banks bonds,
and thereby reducing their effective value, entails and imposes an additional burden on his part. Respondent
cannot rely on the deletion by Presidential Decree No. 251 of the provision in Section 85 that the bonds shall
be accepted in the amount of their face value, and wrest therefrom an interpretation in support of its thesis.

Suffice it to mention that the petitioner is a government lending institution and as such, it has the obligation to
support unequivocably government programs already on stream and not to introduce its own interpretative
policies which may thwart such programs or modify them to nothingness.

The preamble of PD 251 eloquently articulates government intent to implement the state policy of 'diverting
landlord capital in agriculture to industrial development' by 'mobilization and harnessing properly all available
government resources for the realization of the desired agrarian reform program.' For agrarian reform cannot
be fully realized without the intervention of the government particularly in the payment of just compensation.
Surely, the tenant by himself does not have and cannot afford the wherewithal to defray the cost of the land
tranferred to him. It is only with the full support and active assistance of the government principally through its
financial institutions that payment of just compensation to the landowner may be realized.

ADJUDICATION: The writ of mandamus prayed for is hereby GRANTED. Respondent Government Service
Insurance System is ordered to accept the bonds issued by the Land Bank of the Philippines at their par or
face value.

WHEN LAND IS CONSIDERED FOR “PUBLIC USE”

1. NATIONAL HOUSING AUTHORITY vs. HONORABLE PASTOR P. REYES, 123 SCRA 245

FACTS: The undisputed fact that in this certiorari proceeding against respondent Judge for failure to comply
with the provision of the Presidential Decrees as to the amount to be paid by petitioner to entitle it to a writ of
possession in an expropriation proceeding, no question was raised as to their validity, calls for the grant of the
remedy sought. The controversy started with the filing of a complaint with the then Court of Agrarian Relations,
Seventh Regional District, Branch II, Cavite City, against private respondents, for the expropriation, pursuant to
Presidential Decree No. 757, of a parcel of land, with an area of 25,000 square meters, owned and registered
in the name of respondent Quirino Austria, and needed for the expansion of the Dasmariñas Resettlement
Project. Then came from petitioner about a year later, a motion for the issuance of a writ of possession.
Petitioner was able to secure an order placing it in possession. Thereafter, private respondent Quirino Austria
filed a Motion to Withdraw Deposit in the amount of P6,600.00, a sum which was equivalent to the value of the
property assessed for taxation purposes and which was deposited by petitioner pursuant to Presidential
Decree No. 42 . There was an Opposition to the Motion to Withdraw Deposit by petitioner, citing Section 92 of
Presidential Decree No. 464. Petitioner's submission is that the owner's declaration at P1,400.00 which is
lower than the assessor's assessment, is the just compensation for the respondents' property, respondents
thus being precluded from withdrawing any amount more than P1,400.00. Respondent Judge, however, issued
an order dated July 13, 1978 which, according to petitioner, is clearly contrary to the letter and spirit of the
aforecited laws. There was a Motion for Reconsideration dated July 21, 1978. Its basis is the provision in
Presidential Decree No. 1224: "In the determination of just compensation for such private lands and
improvement to be expropriated, the government shall choose between the value of the real property and
improvements thereon as declared by the owner or administrator thereof or the market value determined by
the City or provincial assessor, whichever is lower, at the time of the filing of the expropriation complaint." It
was then submitted that under the aforequoted statutory provision, the owner's declared market value at
P1,400.00 which is lower than that fixed by the assessor is the just compensation of respondent Quirino
Austria's property sought to be expropriated. The motion for reconsideration was denied for lack of merit.

ISSUE: Whether or not there was just compensation.

HELD: The Presidential Decree is mandated by the Constitution which requires the State to "establish,
maintain, and ensure adequate social services in the field of ... housing ..." as well as "to guarantee the
enjoyment of the people of a decent standard of living." 20 In view of the urgency of the housing problem the
various decrees mentioned earlier were issued for the purpose of assuring that the government would be in a
financial position to cope with such basic human need which in the Philippines, under the welfare state
concept, and according to the express language of the Constitution, is an obligation cast upon the State. The
issue in this petition for certiorari and mandamus involves the application of a rule introduced by P.D. No. 76
and reiterated in subsequent decrees that not only promotes social justice but also ends the one-sided practice
supported by the conniving consent of government officials and employees, of under declaring properties for
the purpose of taxation but ballooning the price thereof when the same properties are to be acquired by the
government for public purposes. Put to test is the power of the government to introduce rationality in the laws
and to discourage a deceitful practice that is not only damaging to the government officers but also undermines
its effort at awakening a democratic responsiveness of the citizenry toward good government and its economic
and social programs. The courts should recognize that the rule introduced by P.D. 76 and reiterated in
subsequent decrees does not upset the established concepts of justice or the constitutional provision on just
compensation for, precisely, the owner is allowed to make his own valuation of his property.

ADJUDICATION: The writ of certiorari is granted and the order of respondent judge of July 13, 1978 is hereby
nullified and set aside.

GREEN NOTES:
Who determines the just compensation in expropriation cases? What are the factors to be considered
in determining the same?
Determination of just compensation is a judicial function with the assistance or recommendation of the court-
appointed commissioners. (Manotok vs. CA, May 21,1987)
The factors to be considered in determining the just compensation/market value are:
1. cost of acquisition;
2. the current value of like properties;
3. its actual or potential uses;
4. particular case of lands;
5. their size, shape, location; and
6. the tax declarations thereon.
Finally, note that as held in the case of Republic vs. Santos, 141 SCRA 30, the market value as recommended
by the board of commissioners appointed by the court were at best only ADVISORY AND PERSUASIVE AND
BY NO MEANS FINAL OR BINDING. (BERKENKOTTER, INC. VS. COURT OF APPEALS AND REPUBLIC
OF THE PHILIPPINES, December 14, 1992).
 2. B. H. BERKENKOTTER & CO. vs. COURT OF APPEALS, December 14, 1992

FACTS: The sole issue for resolution in this case is the just compensation to be paid for a parcel of land
sought to be expropriated for the use of the Apolinario R. Apacible School of Fisheries (ARASOF), a
government institution, in Nasugbu, Batangas.

The property has an area of 10,640 square meters and belongs to B. H. Berkenkotter& Co., the herein
petitioner. On June 18, 1982, Vicente Viray, president of the said school, sent the owner a written offer to
buy the land in line with the 5-year expansion program of ARASOF. In reply, Berkenkotter expressed its
willingness to sell at P50.00 per square meter payable in cash. At Viray's request, the Provincial
Appraisal Committee, Office of the Provincial Assessor, Batangas City, appraised the land and fixed its
market value at P32.00 per square meter.Viray then wrote Berkenkotter another letter and offered to buy the
property at the said price. The latter stuck to its original valuation; later it said that the property had in fact
appreciated to as much as P100.00 per square meter. Further negotiations failed to resolve the impasse
between ARASOF and the petitioner. In the end, expropriation proceedings were commenced against
the petitioner by the Republic of the Philippines on behalf of ARASOF.

RTC of Batangas issued an order of condemnation and, pursuant to Rule 67, Section 5, of the Rules of Court,
appointed a panel of commissioners to determine the just compensation to be paid for the land.

Just compensation is defined as the full and fair equivalent of the property sought to be
expropriated. The measure is not the taker's gain but the owner's loss. The compensation, to be just,
must be fair not only to the owner but also to the taker. Even as undervaluation would deprive the
owner of his property without due process, so too would its overvaluation unduly favor him to the
prejudice of the public.

To determine just compensation, the trial court should first ascertain the market value of the property,
to which should be added the consequential benefits which may arise from the expropriation. If the
consequential benefits exceed the consequential damages, these items should be disregarded altogether as
the basic value of the property should be paid in every case.

Among the factors to be considered in arriving at the fair market value of the property are the cost of
acquisition, the current value of like properties, its actual or potential uses, and in the particular case
of lands, their size, shape, location, and the tax declarations thereon.

It is settled that just compensation is to be ascertained as of the time of the taking, which usually
coincides with the commencement of the expropriation proceedings. Where the institution of the
action precedes entry into the property, the just compensation is to be ascertained as of the time of the
filing of the complaint.

On September 23, 1985, the panel of commissioners submitted its report to the trial court and
recommended that the property be appraised at the unit price of P85.00. The Republic objected and
pointed to three contracts of sale the petitioner had concluded in 1985 whereby it sold three tracts of
land similar in topography and adjacent to the property in question for the unit price of only P19.18.
The trial court directed the commissioners to convene anew and receive additional evidence. It did and
conducted more interviews. In its second report dated April 1, 1987, however, the panel reiterated its original
recommendation for the valuation of the property at P85.00 per square meter.

Acting on this recommendation, Judge Roseo L. Venturanza rendered judgment affirming the right of the
plaintiff to expropriate the subject land upon payment to the owner of just compensation at the rate of
P85.00 per square meter, for a total of P904,400.00.

This decision was elevated to and reversed by the Court of Appeals. According to the Court of Appeals,
the lands covered by the three contracts of sale conducted in 1985 were practically disregarded by the trial
court. Moreover, the panel of commissioners relied only "on opinions and conclusions which were patently
hearsay and gratuitous. Not a single document was submitted to support their recommended compensation of
P85.00."

Accordingly, the respondent court set aside the compensation fixed by the trial court and ordered that the
subject property be paid for at the rate of P19.18 per square meter, or a total of P204,075.20, including the
amount already deposited by the Republic when it took possession of the land.

ISSUE: Is the value of the subject property more than P19.18?

HELD: No. The SC does not agree that the commissioners' report was without sufficient basis as it was in fact
made only after extensive interviews with persons who, although not necessarily experts, were nonetheless
familiar with land values in the vicinity of the property sought to be expropriated. Even so, the report and
recommendations of the panel of commissioners were not conclusive upon the trial court, which had
the right and discretion to arrive at its own assessment of the land. The findings of the commissioners
were at best only advisory and persuasive and by no means final or binding. As the Court held in the
case of Republic v. Santos:

According to Section 8 of Rule 67, the Court is not bound by the commissioners' report. It may
make such order or render such judgement as shall secure to the plaintiff the property essential
to the exercise of his right of condemnation, and to the defendant just compensation for the
property expropriated. This Court may substitute its own estimate of the value as gathered from
the record.

What mystifies the Court is why, if the property was really worth P85.00 per square meter in 1985, the
petitioner agreed to sell its other lands, of the same topography as the land in dispute and separated therefrom
by only a road, at only P19.18 per square meter.

There is no showing that the petitioner had any special reason for granting each of the individual vendees the
extraordinary discount amounting to as much as 75% of its claimed real value of the land. To all appearances,
they were ordinary buyers and probably even land investors or speculators who did not deserve any particular
generosity of bounty form the petitioner. Given this far from extraordinary situation, we find it difficult to
understand why the petitioner, while insisting that the 10,640 square meters under expropriation had a unit
price of P85.00, agreed to sell as many as 7,344 square meters of similar land to the first private buyer, 5,583
square meters to the second, and 7,924 square meters to the third, and all for only P19.18 per square meter.

The price demanded by the petitioner from the Republic of the Philippines is more than 4 times the price it
willingly accepted from the private vendees. It is also noteworthy that the individual buyers bought the land for
their own private purposes only and not for the public purpose invoked by the Republic and admitted by the
petitioner itself. And no less importantly, the petitioner has not even made any efforts to differentiate the
subject property from the lands sold at the lower rate, to justify the increase in its price by more than 300%.

The Court is disappointed that the petitioner should demand a higher price for the Republic, which needs the
lands for a public purpose, when it was willing to accept less from the three individual buyers who had only
their private interests to serve. But this is not only a matter of civic spirit. We recognize that the basic issue is
the hard-nosed business of tit for tat. Civic altruism aside, the simple fact is that, whatever its motive, the
petitioner cannot now assert that its property is worth P85.00 per square meter as far as the Republic
is concerned although, by its own voluntary act, it sold similar property to private individuals for only
P19.18 per square meter. There is no satisfactory explanation for this incredible discrimination. The
Republic should not pay more simply because it is the Republic, as if it were a milking cow with
unlimited resource to abuse.

We agree with the respondent court that by selling its lands in the three deed of sale indicated as
Exhibits 1, 2 and 3, at the uniform rate of P19.18 per square meter, the petitioner thereby impliedly
admitted that the lands subject of the expropriation proceeding, being of the same topography and
virtually in the same location is the said other lands, should also be valued at the same rate. This rule of
inconsistency is best expressed in the familiar saying, surely not unknown to the petitioner, that what is sauce
for the goose is also sauce for the gander.

WHEREFORE, the petition is DENIED, and it is hereby affirmed that the just compensation for the subject land
should be computed at the rated of P19.18 per square meter.

3. MANOTOK vs. CA, May 21, 1987

FACTS: Before us are two petitions. The first one challenges the constitutionality of Presidential Decree
No. 1669 which provides for the expropriation of the property known as the "Tambunting Estate" and
the second challenges the constitutionality of Presidential Decree No.1670 which provides for the
expropriation of the property along the Estero de Sunog-Apog. In both cases, the petitioners maintain that
the two decrees are unconstitutional and should be declared null and void because:

(1) They deprived the petitioners of their properties without due process of law.

(2) The petitioners were denied to their right to just compensation

(3) The petitioners' right to equal protection of the law was violated.

(4) The decrees are vague, defective, and patently erroneous.

(5) The petitioners' properties are not proper subjects for expropriation considering their location
and other relevant circumstances.

On June 11, 1977, the President of the Philippines issued Letter of Instruction (LOI) No. 555 instituting a
nationwide slum improvement and resettlement program (SIR). On the same date, the President also issued
LOI No. 557, adopting slum improvement as a national housing policy.

In compliance with LOI No. 555, the Governor of Metro Manila issued, on July 21, 1977, Executive Order
No.6-77 adopting the Metropolitan Manila Zonal Improvement Program which included the properties
known as the Tambunting Estate and the Sunog-Apog area in its priority list for a zonal improvement
program (ZIP) because the findings of the representative of the City of Manila and the National Housing
Authority (NHA) described these as blighted communities.

On March 18, 1978, a fire razed almost the entire Tambunting Estate. Following this calamity, the
President and the Metro Manila Governor made public announcement that the national government
would acquire the property for the fire victims. The President also designated the NHA to negotiate with
the owners of the property for the acquisition of the same. This, however, did not materialize as the
negotiations for the purchase of the property failed.

On December 22, 1978, the President issued Proclamation No. 1810 declaring all sites Identified by the Metro
Manila local governments and approved by the Ministry of Human Settlements to be included in the ZIP upon
proclamation of the President. The Tambunting Estate and the Sunog-Apog area were among the sites
included.

On January 28, 1980, the President issued the challenged Presidential Decrees Nos. 1669 and 1670 which
respectively declared the Tambunting Estate and the Sunog-Apog area expropriated.

On April 4, 1980, the National Housing Authority, through its general-manager, wrote the Register of Deeds of
Manila, furnishing it with a certified copy of P.D. Nos. 1669 and 1670 for registration, with the request that the
certificates of title covering the properties in question be cancelled and new certificates of title be issued in the
name of the Republic of the Philippines.
Subsequently, petitioner Elisa R. Manotok, one of the owners of the properties to be expropriated, received
from the NHA a letter informing her that the latter had deposited, on July 16, 1980, with the Philippine National
Bank the total amount of P5,000,000.00 which included the amount of P3,400,000.00 representing the first
annual installment for the Tambunting Estate pursuant to P.D. No. 1669; and another P5,000,000.00 which
also included the amount of P1,600,000.00 representing the first annual installment for the Sunog-Apog area
under P.D. No. 1670. The petitioner was also informed that she was free to withdraw her share in the
properties upon surrender by her of the titles pertaining to said properties and that if petitioner failed to avail
herself of the said offer, the NHA would be constrained to take the necessary legal steps to implement the
decrees.

On August 19, 1980, petitioner Elisa R. Manotok wrote a letter to the NHA alleging, inter alia, that the amounts
of compensation for the expropriation of the properties of the petitioners as fixed in the decrees do not
constitute the "just compensation" envisioned in the Constitution. She expressed veritable doubts about the
constitutionality of the said decrees and informed the NHA that she did not believe that she was obliged to
withdraw the amount of P5,000,000.00 or surrender her titles over the properties.

In the meantime, some officials of the NHA circulated instructions to the tenants-occupants of the properties in
dispute not to pay their rentals to the petitioners for their lease-occupancy of the properties in view of the
passage of P.D. Nos. 1669 and 1670. Hence, the owners of the Tambunting Estate filed a petition to declare
P.D. No. 1669 unconstitutional. The owners of the Sunog-Apog area also filed a similar petition attacking the
constitutionality of P.D. No. 1670.

The petitioners maintain that the Presidential Decrees providing for the direct expropriation of the properties in
question violate their constitutional right to due process and equal protection of the law because by the mere
passage of the said decrees their properties were automatically expropriated and they were immediately
deprived of the ownership and possession thereof without being given the chance to oppose such
expropriation or to contest the just compensation to which they are entitled.

The petitioners argue that the government must first have filed a complaint with the proper court under Rule 67
of the Revised Rules of Court in order to fulfill the requirements of due process. 'They contend that the
determination of just compensation should not have been vested solely with the City Assessor and that a
maximum or fixed amount of compensation should not have been imposed by the said decrees. Petitioners
likewise state that by providing for the maximum amount of just compensation and by directing the City
Assessor to take into consideration the alleged existing conditions of the properties in question, namely: that
no "improvement has been undertaken on the land and that the land is squatted upon by resident families
which should considerably depress the expropriation costs," the City Assessor is forced to accept, as actual
and existing conditions of the property, the foregoing statements in the decrees when in fact the Sunog-Apog
area has been subdivided into subdivision lots and leased to the occupants thereof under contracts of lease,
making them lessees and not squatters as assumed by Presidential Decree No. 1670. Moreover, each
subdivision lot is surrounded by adobe walls constructed by the particular owner of the property: the houses
were required to have septic tanks by the City Hall and the, owners themselves: there is a drainage system;
and there are adequate water facilities.

As far as the Tambunting Estate is concerned, the petitioners maintain that aside from the residential houses in
the area, there are buildings and structures of strong materials on the lots fronting Rizal Avenue Extension,
most of which are leased to proprietors of business establishments under long term contracts of lease which
use the same for their furniture business from which they secure substantial income.

ISSUE: Are the Presidential Decree Nos. 1669 and 1670 constitutional?

HELD: No. The power of eminent domain is inherent in every state and the provisions in the Constitution
pertaining to such power only serve to limit its exercise in order to protect the individual against whose property
the power is sought to be enforced. We pointed out the constitutional limitations in the case of Republic vs.
Juan (92 SCRA 26, 40):
 To begin with, it must be emphasized that plaintiff-appellee in this instant case is the Republic of
the Philippines which is exercising its right of eminent domain inherent in it as a body sovereign.
In the exercise of its sovereign right the State is not subject to any limitation other than
those imposed by the Constitution which are: first, the taking must be for a public use;
secondly, the payment of just compensation must be made: and thirdly, due process
must be observed in the taking...

The challenged decrees are uniquely unfair in the procedures adopted and the powers given to the
respondent NHA.

The Tambunting subdivision is summarily proclaimed a blighted area and directly expropriated by
decree without the slightest semblance of a hearing or any proceeding whatsoever. The expropriation
is instant and automatic to take effect immediately upon the signing of the decree. No deposit before
taking is required under the decree. The P3,400,000.00 appropriated from the general fund is not a deposit
but constitutes an installment payment for the property, the maximum price of which is fixed so as not to
exceed P17,000,000.00. There is no provision for any interests to be paid on the unpaid installments spread
out over a period of five years. Not only are the owners given absolutely no opportunity to contest the
expropriation, plead their side, or question the amount of payments fixed by decree, but the decisions,
rulings, orders, or resolutions of the NHA are expressly declared as beyond the reach of judicial
review. An appeal may be made to the Office of the President but the courts are completely enjoined from any
inquiry or participation whatsoever in the expropriation of the subdivision or its incidents.

The due process clause cannot be rendered nugatory everytime a specific decree or law orders the
expropriation of somebody's property and provides its own peculiar manner of taking the same. Neither should
the courts adopt a hands-off policy just because the public use has been ordained as existing by the decree or
the just compensation has been fixed and determined beforehand by a statute.

Although due process does not always necessarily demand that a proceeding be had before a court of law, it
still mandates some form of proceeding wherein notice and reasonable opportunity to be heard are given to the
owner to protect his property rights. We agree with the public respondents that there are exceptional situations
when, in the exercise of the power of eminent domain, the requirement of due process may not necessarily
entail judicial process. But where it is alleged that in the taking of a person's property, his right to due process
of law has been violated, the courts will have to step in and probe into such an alleged violation.

The basis for the exercise of the power of eminent domain is necessity. In the instant petitions, there is no
showing whatsoever as to why the properties involved were singled out for expropriation through
decrees or what necessity impelled the particular choices or selections. In expropriations through
legislation, there are, at least, debates in Congress open to the public, scrutiny by individual members of the
legislature, and very often, public hearings before the statute is enacted. Congressional records can be
examined. In these petitions, the decrees show no reasons whatsoever for the choice of the properties as
housing projects. The anonymous adviser who drafted the decrees for the President's signature cannot be
questioned as to any possible error or partiality, act of vengeance, or other personal motivations which may
have led him to propose the direct expropriation with its onerous provisions.

The Tambunting estate or at least the western half of the subdivision fronting Rizal Avenue Extension is
valuable commercial property. It is located at the junction where three main city streets converge — Rizal
Avenue from downtown Manila, Jose Abad Santos Street from Binondo, and Aurora Boulevard leading to
Retiro Street and other points in Quezon City. The Libiran Furniture Company, alone, which fronts the entrance
to Jose Abad Santos Street is clearly a multi-million peso enterprise. It is a foregone conclusion that the
favored squatters allowed to buy these choice lots would lose no time, once it is possible to do so, to
either lease out or sell their lots to wealthy merchants even as they seek other places where they can
set up new squatter colonies. The public use and social justice ends stated in the whereas clauses of
P.D. 1669 and P.D. 1670 would not be served thereby.

The provision of P.D. 1669 which allows NHA, at its sole option, to put portions of the expropriated area to
commercial use in order to defray the development costs of its housing projects cannot stand constitutional
scrutiny. The Government, for instance, cannot expropriate the flourishing Makati commercial area in order to
earn money that would finance housing projects all over the country. The legislature, according to Guido v.
Rural Progress Administration (84 Phil. 847), may not take the property of one citizen and transfer it to
another, even for a full compensation, when the public interest is not thereby promoted. The
Government still has to prove that expropriation of commercial properties in order to lease them out also
for commercial purposes would be "public use" under the Constitution.

P.D. No. 1670 suffers from a similar infirmity. There is no showing how the President arrived at the
conclusion that the Sunog-Apog area is a blighted community. The many pictures submitted as exhibits
by the petitioners show a well-developed area subdivided into residential lots with either middle-income or
upper class homes. There are no squatters. The provisions of the decree on the relocation of qualified squatter
families and on the re-blocking and re-alignment of existing structures to allow the introduction of basic
facilities and services have no basis in fact The area is well-developed with roads, drainage and sewer
facilities, water connection to the Metropolitan Waterworks and Sewerage System electric connections to
Manila Electric Company, and telephone connections to the Philippine Long Distance Telephone Company.
There are many squatter colonies in Metro Manila in need of upgrading. The Government should have
attended to them first. There is no showing for a need to demolish the existing valuable improvements in
order to upgrade Sunog-Apog.

The decrees, do not by themselves, provide for any form of hearing or procedure by which the
petitioners can question the propriety of the expropriation of their properties or the reasonableness of
the just compensation. Having failed to provide for a hearing, the Government should have filed an
expropriation case under Rule 67 of the Revised Rules of Court but it did not do so. Obviously, it did not deem
it necessary because of the enactment of the questioned decrees which rendered, by their very passage, any
questions with regard to the expropriation of the properties, moot and academic. In effect, the properties, under
the decrees were "automatically expropriated." This became more evident when the NHA wrote the Register of
Deeds and requested her to cancel the certificate of titles of the petitioners, furnishing said Register of Deeds
only with copies of the decrees to support its request.

Another infirmity from which the questioned decrees suffer is the determination of just compensation.

Pursuant to P.D. 1533, the basis of the just compensation is the market value of the property "prior to the
recommendation or decision of the appropriate Government Office to acquire the property." (see also Republic
v. Santos, (1 41 SCRA 30, 35).

In these petitions, a maximum amount of compensation was imposed by the decrees and these amounts were
only a little more than the assessed value of the properties in 1978 when, according to the government, it
decided to acquire said properties.

The decision of the government to acquire a property through eminent domain should be made known to the
property owner through a formal notice wherein a hearing or a judicial proceeding is contemplated as provided
for in Rule 67 of the Rules of Court. This shall be the time of reckoning the value of the property for the
purpose of just compensation. A television or news announcement or the mere fact of the property's inclusion
in the Zonal Improvement Program (ZIP) cannot suffice because for the compensation to be just, it must
approximate the value of the property at the time of its taking and the government can be said to have decided
to acquire or take the property only after it has, at the least, commenced a proceeding, judicial or otherwise, for
this purpose.

P.D.s 1669 and 1670 go further. There is no mention of any market value declared by the owner. Sections 6 of
the two decrees peg just compensation at the market value determined by the City Assessor. The City
Assessor is warned by the decrees to "consider existing conditions in the area notably, that no improvement
has been undertaken on the land and that the land is squatted upon by resident families which should
considerably depress the expropriation costs."

In other cases involving expropriations under P.D. Nos. 76, 464, 794, and 1533, this Court has decided to
invalidate the mode of fixing just compensation under said decrees. (See Export Processing Zone Authority v.
Hon. Ceferino E. Dulay, et al. G.R. No. 59603) With more reason should the method in P.D.s 1669 and 1670
be declared infirm.

The market value stated by the city assessor alone cannot substitute for the court's judgment in expropriation
proceedings. It is violative of the due process and the eminent domain provisions of the Constitution to deny to
a property owner the opportunity to prove that the valuation made by a local assessor is wrong or prejudiced.
The statements made in tax documents by the assessor may serve as one of the factors to be
considered but they cannot exclude or prevail over a court determination made after expert
commissioners have examined the property and all pertinent circumstances are taken into account
and after the parties have had the opportunity to fully plead their cases before a competent and
unbiased tribunal.

The maximum amounts, therefore, which were provided for in the questioned decrees cannot
adequately reflect the value of the property and, in any case, should not be binding on the property
owners for, as stated in the above cases, there are other factors to be taken into consideration. We, thus, find
the questioned decrees to likewise transgress the petitioners' right to just compensation. Having violated the
due process and just compensation guarantees, P. D. Nos. 1669 and 1670 are unconstitutional and void.

4. EXPORT PROCESSING ZONE AUTHORITY vs. HON. CEFERINO E. DULAY, April 29, 1987

FACTS: The question raised in this petition is whether or not Presidential Decrees Numbered 76, 464, 794 and
1533 have repealed and superseded Sections 5 to 8 of Rule 67 of the Revised Rules of Court, such that in
determining the just compensation of property in an expropriation case, the only basis should be its market
value as declared by the owner or as determined by the assessor, whichever is lower.

On January 15, 1979, the President of the Philippines, issued Proclamation No. 1811, reserving a certain
parcel of land of the public domain situated in the City of Lapu-Lapu, Island of Mactan, Cebu and
covering a total area of 1,193,669 square meters, more or less, for the establishment of an export
processing zone by petitioner Export Processing Zone Authority (EPZA).

Not all the reserved area, however, was public land. The proclamation included, among others, four (4)
parcels of land with an aggregate area of 22,328 square meters owned and registered in the name of
the private respondent, San Antonio Development Corp. The petitioner, therefore, offered to purchase the
parcels of land from the respondent in acccordance with the valuation set forth in Section 92, Presidential
Decree (P.D.) No. 464, as amended. The parties failed to reach an agreement regarding the sale of the
property.

The petitioner filed with the then Court of First Instance of Cebu, Branch XVI, Lapu-Lapu City, a complaint for
expropriation with a prayer for the issuance of a writ of possession against the private respondent, to
expropriate the aforesaid parcels of land pursuant to P.D. No. 66, as amended, which empowers the petitioner
to acquire by condemnation proceedings any property for the establishment of export processing zones, in
relation to Proclamation No. 1811, for the purpose of establishing the Mactan Export Processing Zone.

On October 21, 1980, the respondent judge issued a writ of possession authorizing the petitioner to take
immediate possession of the premises. On February 17, 1981, the respondent judge issued the order of
condemnation declaring the petitioner as having the lawful right to take the properties sought to be
condemned, upon the payment of just compensation to be determined as of the filing of the complaint.
The respondent judge also issued a second order, subject of this petition, appointing certain persons as
commissioners to ascertain and report to the court the just compensation for the properties sought to be
expropriated.

On June 19, 1981, the three commissioners submitted their consolidated report recommending the
amount of P15.00 per square meter as the fair and reasonable value of just compensation for the
properties.
On July 29, 1981, the petitioner filed a Motion for Reconsideration of the order of February 19, 1981 and
Objection to Commissioner's Report on the grounds that P.D. No. 1533 has superseded Sections 5 to 8 of
Rule 67 of the Rules of Court on the ascertainment of just compensation through commissioners; and
that the compensation must not exceed the maximum amount set by P.D. No. 1533.

The petitioner flied this present petition for certiorari and mandamus with preliminary restraining order,
enjoining the trial court from enforcing the order dated February 17, 1981 and from further proceeding with the
hearing of the expropriation case.

ISSUE: Is the exclusive and mandatory mode of determining just compensation in P.D. No. 1533 valid and
constitutional?

HELD: No. The petitioner maintains that the respondent judge acted in excess of his jurisdiction and
with grave abuse of discretion in denying the petitioner's motion for reconsideration and in setting the
commissioner's report for hearing because under P.D. No. 1533, which is the applicable law herein, the
basis of just compensation shall be the fair and current market value declared by the owner of the
property sought to be expropriated or such market value as determined by the assessor, whichever is
lower. Therefore, there is no more need to appoint commissioners as prescribed by Rule 67 of the
Revised Rules of Court and for said commissioners to consider other highly variable factors in order
to determine just compensation. The petitioner further maintains that P.D. No. 1533 has vested on the
assessors and the property owners themselves the power or duty to fix the market value of the properties and
that said property owners are given the full opportunity to be heard before the Local Board of Assessment
Appeals and the Central Board of Assessment Appeals. Thus, the vesting on the assessor or the property
owner of the right to determine the just compensation in expropriation proceedings, with appropriate procedure
for appeal to higher administrative boards, is valid and constitutional.

Prior to the promulgation of P.D. Nos. 76, 464, 794 and 1533, this Court has interpreted the eminent
domain provisions of the Constitution and established the meaning, under the fundamental law, of just
compensation and who has the power to determine it.

In Municipality of Daet v. Court of Appeals (93 SCRA 503, 516), the Court stated that just compensation
means the equivalent for the value of the property at the time of its taking. Anything beyond that is more and
anything short of that is less, than just compensation. It means a fair and full equivalent for the loss sustained,
which is the measure of the indemnity, not whatever gain would accrue to the expropriating entity."

In Republic v. Santos (141 SCRA 30, 35-36), the Court said that "According to section 8 of Rule 67, the
court is not bound by the commissioners' report. It may make such order or render such judgment as
shall secure to the plaintiff the property essential to the exercise of his right of condemnation, and to
the defendant just compensation for the property expropriated. This Court may substitute its own
estimate of the value as gathered from the record (Manila Railroad Company v. Velasquez, 32 Phil. 286)."

However, the promulgation of the aforementioned decrees practically set aside the above and many
other precedents hammered out in the course of evidence-laden, well argued, fully heard, studiously
deliberated, and judiciously considered court proceedings. The decrees categorically and peremptorily
limited the definition of just compensation thus:

P.D. No. 76:

"For purposes of just compensation in cases of private property acquired by the government for public
use, the basis shall be the current and fair market value declared by the owner or administrator, or such
market value as determined by the Assessor, whichever is lower."

P.D. No. 464:

 "Section 92. Basis for payment of just compensation in expropriation proceedings. — In determining
just compensation which private property is acquired by the government for public use, the basis shall
be the market value declared by the owner or administrator or anyone having legal interest in the
property, or such market value as determined by the assessor, whichever is lower."

P.D. No. 794:

"Section 92. Basis for payment of just compensation in expropriation proceedings. — In determining
just compensation when private property is acquired by the government for public use, the same shall
not exceed the market value declared by the owner or administrator or anyone having legal interest in
the property, or such market value as determined by the assessor, whichever is lower."

P.D. No. 1533:

"Section 1. In determining just compensation for private property acquired through eminent domain
proceedings, the compensation to be paid shall not exceed the value declared by the owner or
administrator or anyone having legal interest in the property or determined by the assessor, pursuant to
the Real Property Tax Code, whichever value is lower, prior to the recommendation or decision of the
appropriate Government office to acquire the property."

We are constrained to declare the provisions of the Decrees on just compensation unconstitutional
and void and accordingly dismiss the instant petition for lack of merit.

The method of ascertaining just compensation under the aforecited decrees constitutes impermissible
encroachment on judicial prerogatives. It tends to render this Court inutile in a matter which under the
Constitution is reserved to it for final determination.

Thus, although in an expropriation proceeding the court technically would still have the power to
determine the just compensation for the property, following the applicable decrees, its task would be
relegated to simply stating the lower value of the property as declared either by the owner or the
assessor. As a necessary consequence, it would be useless for the court to appoint commissioners under
Rule 67 of the Rules of Court. Moreover, the need to satisfy the due process clause in the taking of private
property is seemingly fulfilled since it cannot be said that a judicial proceeding was not had before the actual
taking. However, the strict application of the decrees during the proceedings would be nothing short of
a mere formality or charade as the court has only to choose between the valuation of the owner and
that of the assessor, and its choice is always limited to the lower of the two. The court cannot exercise
its discretion or independence in determining what is just or fair. Even a grade school pupil could
substitute for the judge insofar as the determination of constitutional just compensation is concerned.

We are convinced and so rule that the trial court correctly stated that the valuation in the decree may
only serve as a guiding principle or one of the factors in determining just compensation but it may not
substitute the court's own judgment as to what amount should be awarded and how to arrive at such
amount. A return to the earlier well-established doctrine, to our mind, is more in keeping with the principle that
the judiciary should live up to its mission "by vitalizing and not denigrating constitutional rights." The basic
unfairness of the decrees is readily apparent.

Just compensation means the value of the property at the time of the taking. It means a fair and full
equivalent for the loss sustained. All the facts as to the condition of the property and its surroundings, its
improvements and capabilities, should be considered.

In this particular case, the tax declarations presented by the petitioner as basis for just compensation were
made by the Lapu-Lapu municipal, later city assessor long before martial law, when land was not only much
cheaper but when assessed values of properties were stated in figures constituting only a fraction of their true
market value. The private respondent was not even the owner of the properties at the time. It purchased the
lots for development purposes. To peg the value of the lots on the basis of documents which are out of date
and at prices below the acquisition cost of present owners would be arbitrary and confiscatory.

Various factors can come into play in the valuation of specific properties singled out for expropriation. The
values given by provincial assessors are usually uniform for very wide areas covering several barrios or even
an entire town with the exception of the poblacion. Individual differences are never taken into account. The
value of land is based on such generalities as its possible cultivation for rice, corn, coconuts, or other crops.
Very often land described as "cogonal" has been cultivated for generations. Buildings are described in terms of
only two or three classes of building materials and estimates of areas are more often inaccurate than correct.
Tax values can serve as guides but cannot be absolute substitutes for just compensation.

To say that the owners are estopped to question the valuations made by assessors since they had the
opportunity to protest is illusory. The overwhelming mass of land owners accept unquestioningly what
is found in the tax declarations prepared by local assessors or municipal clerks for them. They do not
even look at, much less analyze, the statements. The Idea of expropriation simply never occurs until a
demand is made or a case filed by an agency authorized to do so.

It is violative of due process to deny to the owner the opportunity to prove that the valuation in the tax
documents is unfair or wrong. And it is repulsive to basic concepts of justice and fairness to allow the
haphazard work of a minor bureaucrat or clerk to absolutely prevail over the judgment of a court
promulgated only after expert commissioners have actually viewed the property, after evidence and
arguments pro and con have been presented, and after all factors and considerations essential to a fair
and just determination have been judiciously evaluated.

The determination of "just compensation" in eminent domain cases is a judicial function. The executive
department or the legislature may make the initial determinations but when a party claims a violation of the
guarantee in the Bill of Rights that private property may not be taken for public use without just compensation,
no statute, decree, or executive order can mandate that its own determination shall prevail over the court's
findings. Much less can the courts be precluded from looking into the "just-ness" of the decreed compensation.

We, therefore, hold that P.D. No. 1533, which eliminates the court's discretion to appoint commissioners
pursuant to Rule 67 of the Rules of Court, is unconstitutional and void. To hold otherwise would be to
undermine the very purpose why this Court exists in the first place.

WHEREFORE, IN VIEW OF THE FOREGOING, the petition is hereby DISMISSED.

5. JOVENCIO LAGUNZAD vs. CA, 154 SCRA 199

FACTS: This petition for review on certiorari seeks to set aside three orders of the respondent Court of
Appeals. An action for eminent domain was filed by the Province of Leyte against some 424
defendants, herein petitioner JovencioLagunzad among them, captioned Province of Leyte vs. Teresita
Yolanda, et al., and docketed as Civil Case No. 5199. On March 11, 1977, the then Court of First Instance of
Leyte decided the case on the basis of Presidential Decree (P.D.) Nos. 76 and 464, ordering the plaintiff
Province of Leyte to compensate those defendants who have not yet received full payment hereof, the market
value of their respective properties in accordance with the provisions of Presidential Decree No. 76 and
Presidential Decree No. 464, Section 92;
Not satisfied with that portion of the decision on just compensation, the petitioner interposed an appeal with the
Court of Appeals.
HELD: While we cannot fault the lower court for deciding the case on the basis of P.D. Nos. 76 and 464, we
must rule otherwise for we have declared unconstitutional and void the presidential decrees on just
compensation. In EPZA vs. Dulay, we held that it is violative of due process to deny to the owner the
opportunity to prove that the valuation in the tax documents is unfair or wrong. And it is repulsive to basic
concepts of justice and fairness to allow the haphazard work of a minor bureaucrat or clerk to absolutely
prevail over the judgment of a court promulgated only after expert commissioners have actually viewed the
property, after evidence and arguments pro and con have been presented, and after all factors and
considerations essential to a fair and just determination have been judiciously evaluated.
The determination of "just compensation" in eminent domain cases is a judicial function. The executive
department or the legislature may make the initial determinations but when a party claims a violation of the
guarantee in the Bill of Rights that private property may not be taken for public use without just compensation,
no statute, decree or executive order can mandate that its own determination shall prevail over the court's
findings. Much less can the courts be precluded from looking into the "just-ness" of the decreed compensation.
In the same case, we, likewise, took note of the inequity that could result in the application of the presidential
decrees on just compensation. Various factors can come into play in the valuation of specific properties singled
out for expropriation. The values given by provincial assessors are usually uniform for very wide areas
covering several barrios or even an entire town with the exception of the poblacion. Individual differences are
never taken into account. The value of land is based on such generalities as its possible cultivation for rice,
corn, coconuts, or other crops. Very often land described as "cogonal" has been cultivated for generations.
Buildings are described in terms of only two or three classes of building materials and estimates of areas are
more often inaccurate than correct. Tax values can serve as guides but cannot be absolute substitutes for just
compensation.
To say that the owners are estopped to question the valuations made by assessors since they had the
opportunity to protest is illusory. The over-whelming mass of land owners accept unquestioningly what is found
in the tax declarations prepared by local assessors or municipal clerks for them. They do not even look at,
much less analyze, the statements. The Idea of expropriation simply never occurs until a demand is made or a
case filed by an agency authorized to do so.
The case at bar is a truly glaring example of the harshness of the abovementioned presidential
decrees. While the petitioner declared his 1.3090-hectare property planted with coconut trees as
having a market value of P10,260.00, the provincial assessor assessed the property in the amount of
P2,160.00 only.On the other hand, the commissioners appointed by the trial court pursuant to sections
5 and 8 of Rule 67 of the Rules of Court, valued the property at even a much higher price than the
valuation given by the petitioner himself, i.e., P20,000.00 per hectare and P25.00 per fruit bearing tree.
This valuation arrived at by the commissioners is what the petitioner prays this Court to consider and
not that fixed by the provincial assessor (the lower price pursuant to the presidential decrees on just
compensation) which, obviously, is unjust, nay oppressive.
We find nothing objectionable in the manner by which the court-appointed commissioners arrived at their
recommendations with regard to the valuation of the affected properties. Neither does petitioner. In fact, it is
precisely the commissioners' report which the petitioner prays this Court to use as the basis for the valuation of
his expropriated property and not the lower court's decision which was based on the questioned presidential
decrees already declared unconstitutional and void and of no effect by us in EPZA vs. Dulay and other cases.
WHEREFORE, in view of the foregoing, the petition is hereby GRANTED. The assailed orders of the
respondent Court of Appeals and the decision of the trial court dated March 11, 1977, as well as the
supplemental judgment dated May 30, 1977, are hereby SET ASIDE and the respondent Province of Leyte
ordered to pay the petitioner the principal amount of TWENTY-SIX THOUSAND SEVEN HUNDRED NINETY
(P26,790.00) PESOS pursuant to the commissioners' valuation plus legal interest to be computed from the
date of taking.