QUESTIONS?

What can be the subject of taking when the State exercises its power of eminent domain?
The exercise of the power of eminent domain is constrained by constitutional provisions that
private property shall not be taken for public use without just compensation under Article III,
sec 9.

When is there “taking” or when is the property deemed “taken”?

There is “taking” when the expropriator enters a private property for more than momentary
period under warrant or color of legal authority and the property is devoted to public use for
public use in such a way as to oust the owner or deprive him of beneficial enjoyment of the
property.

When a property is acquired by the government, it is called “taking.” So, government can
acquire private property of a citizen for public use or public purpose but the onwer of that
property should be provided a “just compensation”.

What are the requirements before LGUs can exercise the power of “taking”?
 A duly enacted ordinance authorizing the LGU head to expropriate. 
 It is for public use, purpose or welfare, or for the benefit of the poor and the landless.
 Payment of just compensation. 
 A valid and definite offer has been previously made to the landowner but was not accepted.

Is there a constitutional presumption if LGU’s exercise its power of inferior domain?

What is “just compensation” in eminent domain?

No private property shall be taken or be use by the government without just compensation.

Should the inflation factor be included in the computation of just compensation?

No. The dalay in payment of the price of expropriated land is sufficiently recompensed
through payment of interest on the market value of the land as of the time of taking from the
landowner

Republic vs. Barcelon.

Was the PHP9,000 per square meter just compensation justified or was it arbitrarily fixed by
the lower court?
Justified. The proximity of the subject property's location to that of Hobart Realty's and
Spouses Serrano's, respectively, was merely one of the factors considered by the RTC and
the CA.

If there is only partial disturbance of property rights, can just compensation be demanded?
No. Becauce the requirement is permanent use of the property

Is full payment of just compensation a pre-requisite before the government can take the
property for public use?

NTC vs. Taglao.

Was the market value fixed by the court speculative and not properly fixed?
Yes. Not only was the fixed market value speculative, it was not properly fixed since it valued
the just compensation as an easement fee even if the 500 KV transmission line will deprive
the owners thereof of its use.
The subject property’s market value should be fixed by the RTC taking into consideration the cost of
acquisition of the land involved, the current value of the like properties, its size, shape, location, as
well as tax declarations thereon, at the time of the filing of the NPC’s complaint.

REPUBLIC VS. ASIA PACIFIC STEEL.

What is just compensation and what factors have to be considered in its determination?
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.

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.

REPUBLIC VS. BPI.

Consequential damages are awarded if as a result of the expropriation, the remaining property of
the owner suffers from an impairment or decrease in value. It may be awarded even if there is no
actual taking of the property as in this case.

REPUBLIC VS. SORIANO.

Is the landowner entitled to the award of consequential damages if the entire area of the
subject property is being expropriated,and not merely a portion thereof?
No, since the entire property is being expropriated, there is no remaining portion which may
suffer an impairment or decrease in value as a result of the expropriation.

EASEMENT FEE.
An easement fee is paid to a landowner for the partial disturbance of his property rights. 
But when the landowner is totally deprived of the beneficial use of his land, he is entitled to
the payment of just compensation. 
NPC vs. SALUDARES. 
NPC vs. MAKABANGKIT SANGKAY.

NTC VS. OROVILLE DEV. CORP. 

Whether or not the computation of just compensation for the expropriated property should
be based on its value at the time of the taking of the property?
Just compensation should be reckoned from 1983 when the actual “taking” took place by
NTC upon the construction of transmission lines on Oroville’s property.

Are the rulings in Macabangkit Sangkay and Saludares the prevailing doctrine and
controlling ruling on the reckoning period of just compensation?
No. The rulings in Macabangkit Sangkay and Saludares are mere exceptions.

Whether or not the imposition of a legal interest of 12% is unjustified?
No. The owner's loss, of course, is not only his property but also its income-generating
potential. Oroville is entitled to 12% interest per annum which is the prevailing rate in 1983
per Central Bank Circular No. 905.

NPC VS. MANALASTAS. 

Should the inflation factor be included in the computation of just compensation?
No. Inflation is properly accounted for through payment of interest on the amount due to the
landowner, and through the award of exemplary damages and attorney's fees in cases
where there was irregularity in the taking of property.

DPWH VS. TECSON.
Should just compensation include lost “income-generating potential”?
 Yes. The owner's loss is not only his property but also its income-generating potential. Thus,
when property is taken, full compensation of its value must immediately be paid to achieve a
fair exchange for the property and the potential income lost.

REPUBLIC VS. PIATCO.

Are “fair market value” and “replacement cost” similar eminent domain standards of
property valuation?
No. Fair market value, which is the price at which a property may be sold by a seller who is
not compelled to sell and bought by a buyer who is not compelled to buy --- is the general
standard of property valuation.
NTC VS. DE LEON.
Was there legal basis for the award of consequential damages of PHP22million?
No. The award of consequential damages is limited to 50% of the BIR zonal valuation of the
property segregated by the electric transmission lines or for PHP2.7million.

LAND BANK VS. EUSEBIO. 

The “just compensation” guaranteed to a landowner under, Sec. 4, Art. XIII of the Constitution is
precisely the same as the “just compensation” embodied in Sec. 9, Art. III. Whether taken pursuant
to the State’s agrarian reform program or for purposes other than agrarian reform, the just
compensation “fair and full price of the taken property.”

MERCADO VS. LAND BANK. 

Is the determination of just compensation an administrative or a judicial function?
The determination of just compensation is a judicial function and the RTC, acting as SAC, has the
original and exclusive power to determine just compensation and must be guided by the valuation
factors under Sec. 17 of RA 6657 & basic formula in DAR A.O. No. 5.

REPUBLIC VS. PIATCO. 

Are “fair market value” and “replacement cost” similar eminent domain standards of
property valuation?
No. Fair market value, which is the price at which a property may be sold by a seller who is
not compelled to sell and bought by a buyer who is not compelled to buy --- is the general
standard of property valuation.

In contrast, replacement cost is “the amount necessary to replace the improvements/structures,

based on the current market prices for materials, equipment, labor, contractor’s profit and overhead,
and all other attendant costs associated with the acquisition and installation in place of the affected
improvements/structures.”

Shall the “depreciated replacement cost approach” or the “new replacement cost approach”
be used in the appraisal of the NAIA III?
The depreciated replacement cost method, rather than the new replacement cost method, is
the more appropriate method to use in appraising NAIA-IPT III.

Injustice would result if we award PIATCO just compensation based on the new replacement cost of
the NAIA-IPT III, and disregard the fact that the Government expropriated a terminal that is not
brand new. PIATCO will be compensated for more than what it had actually lost if the “new
replacement cost” method is adopted.

REPUBLIC VS. PIATCO.

Is the application of the depreciated replacement cost method allowed under RA 8974? 
While Section 10, RA 897 IRR uses the word "shall" in referring to the use of the
replacement cost method in determining valuation of the improvements and/or structures on
the land to be expropriated, such is a directive to the implementing agency.
Any finding on just compensation using the methods set forth in the statute is merely a preliminary
determination by the implementing agency, subject to the final review and determination by the
Court.

In the present case, we adopted the depreciated replacement cost method as a guideline in the
computation of just compensation; at the same time, we reconciled this method with our duty to
award just compensation as a constitutional mandate to compensate the owner with his actual loss.

Is PIATCO entitled to interest as well as the fruits and income of NAIA III?
The Government’s initial payment of just compensation does not excuse it from avoiding
payment of interest on the difference between the adjudged amount of just compensation
and the initial payment.

But PIATCO is not entitled to the fruits and income of the NAIA-IPT III. The interest awarded by the
expropriation court is, in reality, the equivalent of the fruits or income of the seized property --- which
makes up for the shortfall in the owners’ earning potential.

Parañaque vs. VM Realty.

Can eminent domain be barred by res judicata? 
The principle of res judicata, which finds application in generally all cases and proceedings,
cannot bar the right of the State or its agent to expropriate private property.

And while the principle of res judicata does not denigrate the right of the State to exercise eminent
domain, it does apply to specific issues decided in a previous case. For example, a final judgment
dismissing an expropriation suit on the ground that there was no prior offer precludes another suit
raising the same issue..

NPC vs. Makabangkit.
Is the five year prescriptive period under Section 3(i) of Republic Act No. 6395 applicable to
an action to recover just compensation?
No. Sec. 3(i), R.A 6395 is applicable only to an action for damages, and does not extend to
an action to recover just compensation like this case against NPC.

JUDICIAL REVIEW. 
 Usual issues subject judicial scrutiny: 
 Adequacy of compensation. 
 Necessity of the “taking.” 
 Public use character of the “taking.” 
 If exercised by the State, the presumption of constitutionality and validity applies, but not if
exercised by entities other than the State.

QUESTIONS?
When is the “obligation of contracts” considered or deemed impaired?
It is indeed deemed impaired, If a private person his/her civil rights is place in disadvantage

CLEMONS VS. NOLTING.

A law impairs the obligations of a contract if:
it changes the terms of a legal contract between parties either in the time or mode of performance.
it imposes new conditions, or dispenses with those expressed.
It authorized for its satisfaction something different from that provided in its terms.
YINLU BICOL MINING VS. TRANS-ASIA OIL & EDC.
Are rights pertaining to mining patents issued pursuant to the Philippine Bill of 1902 and
existing prior to November 15, 1935, vested rights that cannot be impaired?
Yes, they are vested rights that cannot be impaired. The lands and minerals covered by
Yinlu’s mining patents are private properties.

Does the non-impairment of “obligation of contracts” protect only private contracts?

No. Because sometimes the government enter contract with private entities.

PRYCE CORP. VS. CHINA BANKING.

The purpose of the non-impairment clause of the Constitution is to safeguard the integrity of
contracts against unwarranted interference by the State.

GOLDENWAY VS. EQUITABLE PCI BANK.

Does Section 47 of R.A. 8791 violate the constitutional proscription against impairment of
the obligation of contract?
No. Section 47 did not divest juridical persons of the right to redeem their foreclosed
properties but only modified the time for the exercise of such right by reducing the oneyear
period originally provided in Act 3135.

CONTRACT CLAUSE.
No law impairing the obligation of contracts shall be passed.
The non-impairment of contract clause is a limitation on the exercise of legislative power and not of
judicial or quasi-judicial power.

HOSPICIO DE SAN JOSE VS. DAR.

Does the non-impairment of “obligation of contracts” clause refers to private contracts?
Yes, only to private contracts. The provision was intended to shield the impairment of obligations
created by private agreements,
and not by legislative fiat.

WHO CAN INVOKE?

 Aliens?  Yes.
 Artificial persons?  Yes, limited.
 Franchisee?  No.


CLEMONS VS. NOLTING.
A law impairs the obligations of a contract if:
it changes the terms of a legal contract between parties either in the time or mode of performance.
it imposes new conditions, or dispenses with those expressed.
It authorized for its satisfaction something different from that provided in its terms.

GOLDENWAY VS. PCI BANK.
Is the non-impairment clause inferior to the police power of the State?
Yes. Settled is the rule that the nonimpairment clause of the Constitution must yield to the
loftier purposes targeted by the Government. The right granted by this provision must submit
to the demands and necessities of the State’s power of regulation.


YINLU BICOL MINING VS. TRANSASIA.

SWS vs. Comelec.
Does Comelec Res. No. 9674 impair the obligation of contract by forcing petitioners to
disclose the names of “subscribers” of election surveys?
No. As a valid exercise of COMELEC’s regulatory powers, Resolution No. 9674 is correctly
deemed written into petitioners’ existing contracts.

NEECO I vs. ERC.
Whether or not the cap on the recoverable rate of system loss prescribed in Section 10 of
R.A. No. 7832 is arbitrary and violative of the non-impairment clause?
 No. All private contracts must yield to the superior and legitimate measures taken by the State to
promote public welfare.

RULE OF THE THUMB.

The “non-impairment” clause can only be applied to private contracts.
The “non-impairment” clause can only be invoked against Congress.
The “non-impairment” clause is inferior to the police power of the State.

QUESTIONS?
What does the free access to the courts and quasi-judicial bodies guarantee?

FRIAS VS. JUDGE SORONGON.

Was the order of Judge Sorongon violative of constitutional right to free access to courts?
No. Petitioners failed to complete the requirements to support their petition to litigate as
indigent. During the hearing, they also failed to substantiate and prove their claim of
indigency.

FREE ACCESS TO COURTS.

 Free access to the courts and quasi-judicial bodies and adequate legal assistance shall not be
denied to any person by reason of poverty.

 Free access guarantees exemption from payment of filing fees in the filing of cases in courts
and quasi-judicial bodies.

WHO CAN INVOKE?

Foundations? No.
PAO clients? Yes, if qualified.
IBP-Legal Aid clients? Yes, if qualified.

LETTER OF PAO ACOSTA.

Are sheriff’s expenses covered by the exemption granted to PAO’s clients under Section 6 of
R.A. No. 9406?
No. The exemption applies only to docket court and other fees incidental to instituting an
action in court and not to sheriff’s fees which are exacted for services rendered by a court in
case pending before it.

Can officials and employees of PAO be allowed to serve summons, subpoena and other
court processes in behalf of their clients?
Yes, in keeping with the constitutional mandate to free access to courts.