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155650, July 20, 2006
The Manila International Airport Authority (MIAA) operates the Ninoy Aquino International Airport (NAIA) Complex in Parañaque City under Executive Order No. 903 (MIAA Charter), as amended. As such operator, it administers the land, improvements and equipment within the NAIA Complex. In March 1997, the Office of the Government Corporate Counsel (OGCC) issued Opinion No. 061 to the effect that the Local Government Code of 1991 (LGC) withdrew the exemption from real estate tax granted to MIAA under Section 21 of its Charter.
Thus, MIAA paid some of the real estate tax already due. In June 2001, it received Final Notices of Real Estate Tax Delinquency from the City of Parañaque for the taxable years 1992 to 2001. The City Treasurer subsequently issued notices of levy and warrants of levy on the airport lands and buildings.
At the instance of MIAA, the OGCC issued Opinion No. 147 clarifying Opinion No. 061, pointing out that Sec. 206 of the LGC requires persons exempt from real estate tax to show proof of exemption. According to the OGCC, Sec. 21 of the MIAA Charter is the proof that MIAA is exempt from real estate tax. MIAA, thus, filed a petition with the Court of Appeals seeking to restrain the City of Parañaque from imposing real estate tax on, levying against, and auctioning for public sale the airport lands and buildings, but this was dismissed for having been filed out of time.
Hence, MIAA filed this petition for review, pointing out that it is exempt from real estate tax under Sec. 21 of its charter and Sec. 234 of the LGC. It invokes the principle that the government cannot tax itself as a justification for exemption, since the airport lands and buildings, being devoted to public use and public service, are owned by the Republic of the Philippines. On the other hand, the City of Parañaque invokes Sec. 193 of the LGC, which expressly withdrew the tax exemption privileges of government-owned and controlled corporations (GOCC) upon the effectivity of the LGC.
It asserts that an international airport is not among the exceptions mentioned in the said law. Meanwhile, the City of Parañaque posted and published notices announcing the public auction sale of the airport lands and buildings. In the afternoon before the scheduled public auction, MIAA
The Republic remains the beneficial owner of the properties. but an instrumentality of the government. which provides that the exercise of the taxing powers of local governments shall not extend to the levy of taxes. The airport lands and buildings of MIAA are exempt from real estate tax imposed by local governments. the President can transfer back to the Republic title to the airport lands and . which historically merely delegated to local governments the power to tax. Moreover. The rule is that a tax is never presumed and there must be clear language in the law imposing the tax. Sec. MIAA is not a GOCC. At any time. 133(o) of the LGC. MIAA itself is owned solely by the Republic. however. These provisions recognize the basic principle that local governments cannot tax the national government. This rule applies with greater force when local governments seek to tax national government instrumentalities. fees or charges of any kind on the National Government. the same was received only by the City of Parañaque three hours after the sale. The Court issued a TRO on the day of the auction sale. 243(a) of the LGC exempts from real estate tax any real property owned by the Republic of the Philippines. This exemption should be read in relation with Sec. Issue: Whether or not the airport lands and buildings of MIAA are exempt from real estate tax? Held: The Petition is GRANTED. its agencies and instrumentalities. a tax exemption is construed liberally in favor of national government instrumentalities.applied with the Court for the issuance of a TRO to restrain the auction sale.
As long as the airport lands and buildings are reserved for public use. they are not subject to levy on execution or foreclosure sale.buildings without the Republic paying MIAA any consideration. their ownership remains with the State. Unless the President issues a proclamation withdrawing these properties from public use. As such. . and they are exempt from real estate tax. they are inalienable. In such a case. MIAA has granted the beneficial use of such portions for a consideration to a taxable person. However. they remain properties of public dominion. hence. portions of the airport lands and buildings that MIAA leases to private entities are not exempt from real estate tax.
As rebuttal witnesses. petitioners presented a Deed of Absolute Sale dated December 9. having been acquired during his marriage with one Alejandra Nava. 1/28. 1957. Ten years later Remedios died. . Respondents presented oral evidence to show that Gonzalo expressed his intentions regarding the disposition of his properties. The other co-owners of Lot 421 and their respective shares were: Jacinto Palad. They submit that since the shares were acquired during the marriage of Gonzalo and Remedios. Modesta Nojadera (Modesta). Concordia Nojadera . testified that she is the Concordia Nojedera mentioned in the TCT but disowned the Deed of Absolute Sale dated December 16. and Ignacio. Ramon Nojadera. Concordia Jornal. had three children from her previous marriage. also a rebuttal witness. Bagac. Bataan. Thereafter. Sometime during the Japanese Occupation.944 square meters and covered by Transfer Certificate of Title No. which included his share in Lot 421 and a 173-square meter lot in Pag-asa. 1/28. Adelaida. Remedios inherited Gonzalo's shares in Lot 421. The union of Gonzalo and Remedios bore no children. that Gonzalo intended that the Pag-asa property would be given to Remedios and the same would be left to her granddaughter. and. Gallego testified that Benjamin. Spouses Juan Banzon and Elena Gutierrez. were their children. Gonzalo died. 1957 executed by sisters Modesta and Concordia selling their separate shares in Lot 421 in favor of Gonzalo. petitioners took possession of a portion of Lot 421 and despite respondents' demands to vacate and turn over possession of the property. 1957 and her purported signature therein. Moreover. Palad and Maria A. 1/14. as surviving heir of Gonzalo. Adelaida and Ignacio. On the other hand. Francisco Palad. that it was the Palad tradition that land inherited by members of the clan shall be disposed only to the clan and to no other person. with an area of 32. Merlita Herbon Espiritu. The extent of his co-ownership in Lot 421 is ¼ and 1/14. Gonzalo's son. Adelaida and Ignacio. that Gonzalo's share in Lot 421 should be left to Ignacio. Alejandra died. Later on.HEBRON vs PALAD 495 SCRA 591 July 2006 FACTS: Gonzalo Palad was a co-owner of a parcel of agricultural land located in Poblacion. 4408 of the Register of Deeds of Bataan. 1/28. that the Pag-asa property has already been transferred to Merlita in accordance with the wishes of Gonzalo. Ana Nojadera. ¼ and 1/14. as well as a Deed of Absolute Sale dated December 16.3 Gonzalo's share in Lot 421 was conjugal property. 1/28. On November 16. a widow. Bataan. herein petitioners. eldest daughter of petitioner Gabino Herbon. petitioners refused to do so. 1/14. 1/14. otherwise known as Lot 421. Lorenzo Palad. Benjamin. Gonzalo contracted a second marriage with Remedios Torres Remedios. 1957 executed by Jacinto selling his shares in Lot 421 to Gonzalo. Bayani M. paid for Jacinto's shares in the Deed of Absolute Sale dated December 9. respondents' father. 1983. said shares form part of the conjugal property and Remedios was entitled to a part thereof as her conjugal share. Bagac.
namely: Gonzalo. Their testimonies do not show that the payment was intended to establish a trust relationship. There is an implied trust when property is sold. Thus. constituting valuable consideration. Said witnesses are complete strangers in so far as the intent of the parties to the contract is concerned. or an equivalent. the evidence must be trustworthy and received by the courts with extreme caution. The former is the trustee. depending as it does exclusively on human memory. As a rule. the Deed of Absolute Sale dated December 9. An implied trust. Without any doubt. from the document itself. Trustworthy evidence is required because oral evidence can easily be fabricated. As Judge Limpkin of Georgia once said. Can implied trust be proven by oral evidence? RULING “Art. of the one paying the price of the sale. and should not be made to rest on loose. In the present case. and such proof. the elements of which are: (a) an actual payment of money. property or services. In this case.” The trust created under the first sentence of Article 1448 is sometimes referred to as a purchase money resulting trust. in order to establish an implied trust in real property by parol evidence. The Court is thus convinced that the deed expresses truly the parties' intent as against the oral testimony that Benjamin paid the consideration of the sale. no trust is implied by law. While implied trusts may be proved by oral evidence. paid for Jacinto's shares in Lot 421 are vague and contain no specificities. No amount of extrinsic aids are required and no further extraneous sources are necessary in order to ascertain the parties' intent. the burden of proving the existence of a trust is on the party asserting its existence. However. Adelaida and Ignacio. spoken words could be notoriously unreliable as against a written document that speaks a uniform language . the parol evidence offered to prove the existence of an implied trust is lean. it being disputably presumed that there is a gift in favor of the child. in fine. cannot be established upon vague and inconclusive proof. "I would sooner trust the smallest slip of paper for truth than the strongest and most retentive memory ever bestowed on mortal man. the proof should be as fully convincing as if the acts giving rise to the trust obligation are proven by an authentic document. and (b) such consideration must be furnished by the alleged beneficiary of a resulting trust. is not as reliable as written or documentary evidence. while the latter is the beneficiary. The testimonies of Bayani and Maria that Benjamin. 1957 executed by Jacinto is clear and unequivocal as to who are the vendees. legitimate or illegitimate. oral testimony as to a certain fact." Indeed. equivocal or indefinite declarations. Is there implied trust? 2. 1448. instead of Gonzalo. frail and far from convincing. determinable as it is. and the legal estate is granted to one party but the price is paid by another for the purpose of having the beneficial interest of the property.ISSUE: 1. if the person to whom the title is conveyed is a child.