6. Manila International Airport Authority v. CA.
FACTS:
July 20, 2006 | J. Carpio | Not subject to attachment and execution
Recit Ready:
The Manila International Airport Authority (MIAA) Charter transferred
to MIAA approximately 600 hectares of land, including the runways and
buildings ("Airport Lands and Buildings") then under the Bureau of Air
Transportation. Due to the supposed delay of MIAA to pay real estate
taxes, the City of Parañaque, through its City Treasurer, issued notices of
levy and warrants of levy on the Airport Lands and Buildings. The Mayor
of the City of Parañaque threatened to sell at public auction the Airport
Lands and Buildings should MIAA fail to pay the real estate tax
delinquency. In January 2003, the City of Parañaque posted notices of
auction sale at the Barangay Halls; in the public market; and in the main
lobby of the Parañaque City Hall. The petition sought to restrain the City
of Parañaque from imposing real estate tax on, levying against, and
auctioning for public sale the Airport Lands and Buildings, which the CA
dismissed. MIAA argues that it cannot claim ownership over these
properties since the real owner of the Airport Lands and Buildings is the
Republic of the Philippines. The MIAA Charter mandates MIAA to
devote the Airport Lands and Buildings for the benefit of the general
public. Since the Airport Lands and Buildings are devoted to public use
and public service, the ownership of these properties remains with the
State. The Airport Lands and Buildings are thus inalienable and are not
subject to real estate tax by local governments.
The issue here is whether or not the Airport Lands and Buildings of
MIAA can be taxed – NO, Under Article 420 of the Civil Code, the
Airport Lands and Buildings of MIAA, being devoted to public use, are
properties of public dominion and thus owned by the State or the
Republic of the Philippines. Article 420 specifically mentions "ports . . .
constructed by the State," which includes public airports and seaports, as
properties of public dominion and owned by the Republic. As properties
of public dominion owned by the Republic, there is no doubt whatsoever
that the Airport Lands and Buildings are expressly exempt from real
estate tax under Section 234(a) of the Local Government Code. This
Court has also repeatedly ruled that properties of public dominion are not
subject to execution or foreclosure sale.
 MIAA operates in Paranaque City under the MIAA Charter (EO
903).
 MIAA Charter transferred to MIAA approx 600 hectares of land
(including runways and buildings) known as Airport Lands and
Buildings.
 MIAA administers the land, improvements and equipment within
the NAIA complex.
 The MIAA Charter provides that no portion of the land transferred
to MIAA shall be disposed of through sale or any other mode
unless specifically approved by the President.
 The Office of the Government Corporate Counsel (OGCC) issued
an opinion to withdraw the exemption from real estate tax granted
to MIAA under the Charter.
 MIAA later received Finale Notices of Real Estate Tax
Delinquency (Php64M) from the City of Paranaque.
 Through the City Treasurer, the City of Paranaque issued notices
of levy and warrants of levy on the Airport Lands and Buildings.
The Mayor threatened to sell at public auction the Airport Lands
and Buildings should MIAA fail to pay.
 Later the OGCC pointed out that exemption from real estate tax
requires proof of exemption. OGCC said that the MIAA Charter is
sufficient proof of exemption.
 MIAA filed with CA seeking the restrain the City from imposing
real estate tax on, levying against, and auctioning for public sale
the Airport Lands and Buildings. CA dismissed. Hence this
petition.
 Meanwhile, the City posted notices of auction sale in public areas
such as Brgy Halls and the City Hall, and a newspaper of general
circulation (Daily Inquirer). The notices announced the public
auction sale of the AIrport Lands and Buildings.
 MIAA filed a Motion, TRO granted. But City of Paranaque
received the TRO only 3 hours after the end of the public auction.
ISSUE: W/N the Airport Lands and Buildings can be taxed – NO
RULING:
 PUBLIC DOMINION. The Airport Lands and Buildings of the
MIAA are property of public dominion and therefore owned by the
State.
 Art 419 - The ff things are property of public dominion: (1) Those
intended for public use, such as roads, canals, rivers, torrents, ports
and bridges constructed by the State....
 The term “ports” includes seaports and airports. MIAA Airport
Lands and Buildings constitute a “port”.
 The Airport Lands and Buildings are devoted to public use because
they are used by the public for international and domestic travel
and transportation.
 As properties of public dominion, they indisputably belong to the
State or the Republic of the Philippines.
 FEES. The charging of fees does not determine the character of the
property whether it is of public dominion or not. Someone must
pay for the maintenance. The tollway system is even a more
efficient and equitable manner of taxing the public for
maintenance.
 NOT SUBJ TO ATTACHMENT OR EXECUTION. The Airport
Lands and Buildings of the MIAA, as properties of public
dominion, are outside the commerce of man. The Court has
repeatedly ruled that properties of public dominion are outside the
commerce of man. Being outside the commerce of man, it cannot
be the subject of an auction sale. Any encumbrance, levy on
execution or auction sale of any property of public dominion is
void for being contrary to public policy.
 Essential public services will stop if properties of public dominion
are subject to encumbrances, foreclosures and auction sale.
 For MIAA to be able to encumber the Airport Lands and Buildings
 The Pres must first withdraw from public se the Airport Lands and
Buildings by proclamation.
 EXEMPT FROM TAX. LGC exempts from real estate tax any
“real property owned by the Republic”.
 MIAA IS NOT OWNER. MIAA is merely holding title to the
Airport and Buildings in trust for the Republic. The beneficial
owner is the Republic.
 Authority.