RAFAEL S.
SALAS, in his capacity as City of Manila, for some reasons, brought an
Executive Secretary; CONRADO F.
ESTRELLA, in his capacity as Governor of the
Land Authority; and LORENZO GELLA, in his
capacity as Register of Deeds of
Manila, petitioners-appellants,
vs.
HON. HILARION U. JARENCIO, as Presiding
Judge of Branch XXIII, Court of First Instance
of Manila; ANTONIO J. VILLEGAS, in his
capacity as Mayor of the City of Manila; and
the CITY OF MANILA, respondents-appellees.
Facts:
1.) City of Manila owner in fee simple of a
parcel of land known as Lot 1, Block 557 of
Cadastral Survey of City of Manila, containing an
area of 9689.80 sqm.
2.) On various dates in 1927, City of Manila
sold portions of the parcel of land. When the last
sale was effected August 1924, Transfer
Certificate of Title 22547 covering the residue of
the land 7490.10 sam was issued in the name of
City of Manila.
3.) On September 1960, Municipal Board of
Manila adopted a resolution requesting the
President to consider the feasibility of declaring
the land under Transfer Certificate of Title
25545-25547 as patrimonial property of Manila
for the purpose of selling these lots to the actual
occupants thereof.
4.) The resolution was then transmitted to
the Congress. The bill was then passed by
Congress and approved by President, and
became Republic Act 4118, converting the land
from communal property to disposable and
alienable land of State.
5.) To implement RA 4118, Land Authority
requested City of Manila to deliver the Citys TCT
22547 in order to obtain title thereto in the name
of Land Authority. The request was granted with
the knowledge and consent of City mayor,
cancelling TCT 22547 and issuing TCT 80876 in
the name of Land Authority.
action to restrain, prohibit, and enjoin Land
Authority and Register of Deeds from
implementing RA 4118, and praying for the
declaration of RA 4118 as unconstitutional.
6.) Trial court declared RA 4118 to be
unconstitutional and invalid on the ground that it
deprived City of its property without due process
of law and payment of just compensation.
7.) Land Authority and Register of Deeds
argued that the land is a communal land, or a
portion of public domain owned by State; that
the land has not been used by City of Manila for
any public purpose; that it was originally a
communal land not because it was needed in
connection with its organisation as a municipality
but rather for the common use of its inhabitants;
that the City mayor merely enjoys the usufruct
over said land and its exercise of acts of
ownership by selling parts thereof did not
necessarily convert the land into a patrimonial
property of City of Manila nor divert the State of
its paramount title.
Issue:
Whether the aforementioned land is a private or
patrimonial property of the City of Manila.
Held:
The land is public property.
As a general rule, regardless of the source or
classification of the land in the possession of
municipality, excepting those which it acquired in
its own funds in its private or corporate capacity,
such property is held for the State for the benefit
of its inhabitants, whether it be for governmental
or proprietary purposes. The legal situation is the
same if the State itself holds the property and puts
it to a different use.
When it comes to property of municipality which it
did not acquire in its private or corporate capacity
with its own funds (the land was originally given
to City by Spain), the legislature can transfer its
administration and disposition to an agency of the
National Government to be disposed of according
to its discretion. Here it did so in obedience to the
constitutional mandate of promoting social justice
to insure the well-being and economic security of
the people.
The property was not acquired by the City of
Manila with its own funds in its private or
proprietary capacity. The land was part of the
territory of City of Manila granted by sovereign in
its creation. Furthermore, City expressly
recognised the paramount title of the State over
its land when it requested the President to
consider the feasibility of declaring the lot as
patrimonial property for selling.
There could be no more blatant recognition of the
fact that said land belongs to the State and was
simply granted in usufruct to the City of Manila for
municipal purposes. But since the City did not
actually use said land for any recognized public
purpose and allowed it to remain idle and
unoccupied for a long time until it was overrun by
squatters, no presumption of State grant of
ownership in favor of the City of Manila may be
acquiesced in to justify the claim that it is its own
private or patrimonial property.
WHEREFORE, the appealed decision is hereby
reversed, and petitioners shall proceed with the
free and untrammeled implementation of
Republic Act No. 4118 without any obstacle from
the respondents. Without costs.
THE PROVINCE OF ZAMBOANGA DEL
NORTE, plaintiff-appellee,
vs.
CITY OF ZAMBOANGA, SECRETARY OF
FINANCE and COMMISSIONER OF
INTERNAL REVENUE,defendants-appellants.
Facts:
1.) Prior to its incorporation as a chartered
city, the Municipality of Zamboanga used to be the
provincial capital of the then Zamboanga Province.
2.) On October 12, 1936, Commonwealth
Act 39 was approved converting the Municipality of
Zamboanga into Zamboanga City.
3.) Sec. 50 of the Act also provided that
Buildings and properties which the province shall
abandon upon the transfer of the capital to another
place will be acquired and paid for by the City of
Zamboanga at a price to be fixed by the Auditor
General.
4.) Such properties include lots of capitol
site, schools, hospitals, leprosarium, high school
playgrounds, burleighs, and hydro-electric sites.
5.) On June 6, 1952, Republic Act 711 was
approved dividing the province of Zamboanga into
two (2): Zamboanga del Norte and Zamboanga
del Sur.
6.) As to how the assets and obligations of
the old province were to be divided between the two
new ones, Sec. 6 of that law provided Upon the
approval of this Act, the funds, assets and other
properties and the obligations of the province of
Zamboanga shall be divided equitably between the
Province of Zamboanga del Norte and the Province
of Zamboanga del Sur by the President of the
Philippines, upon the recommendation of the
Auditor General.
7.) However, on June 17, 1961, Republic
Act 3039 was approved amending Sec. 50 of
Commonwealth Act 39 by providing that, All
buildings, properties and assets belonging to the
former province of Zamboanga and located within
the City of Zamboanga are hereby transferred, free
of charge, in favor of the said City of Zamboanga.
8.) This constrained Zamboanga del Norte
to file on March 5, 1962, a complaint against
defendants-appellants Zamboanga City; that,
among others, Republic Act 3039 be declared
unconstitutional for depriving Zamboanga del Norte
of property without due process and just
compensation.
9.) Lower court declared RA 3039
unconstitutional as it deprives Zamboanga del
Norte of its private properties.
Hence the appeal.
Issue:
Whether RA 3039 is unconstitutional on the
grounds that it deprives Zamboanga del Norte of
its private properties.
Held:
No. RA 3039 is valid. The properties petitioned
by Zamboanga del Norte is a public property.
The validity of the law ultimately depends on the
nature of the 50 lots and buildings thereon in
question. For, the matter involved here is the
extent of legislative control over the properties of
a municipal corporation, of which a province is
one. The principle itself is simple: If the property
is owned by the municipality (meaning municipal
corporation) in its public and governmental
capacity, the property is public and Congress has
absolute control over it. But if the property is
owned in its private or proprietary capacity, then
it is patrimonial and Congress has no absolute
control. The municipality cannot be deprived of it
without due process and payment of just
compensation.
The capacity in which the property is held is,
however, dependent on the use to which it is
intended and devoted. Now, which of two norms,
i.e., that of the Civil Code or that obtaining under
the law of Municipal Corporations, must be used
in classifying the properties in question?
Civil Code
The Civil provide: ART. 423. The property of
provinces, cities, and municipalities is divided into
property for public use and patrimonial property;
ART. 424. Property for public use, in the
provinces, cities, and municipalities, consists of
the provincial roads, city streets, municipal
streets, the squares, fountains, public waters,
promenades, and public works for public service
paid for by said provinces, cities, or
municipalities. All other property possessed by
any of them is patrimonial and shall be governed
by this Code, without prejudice to the provisions
of special laws.
Applying the above cited norm, all the properties
in question, except the two (2) lots used as High
School playgrounds, could be considered as
patrimonial properties of the former Zamboanga
province. Even the capital site, the hospital and
leprosarium sites, and the school sites will be
considered patrimonial for they are not for public
use. They would fall under the phrase public
works for public service for it has been held that
under the ejusdem generis rule, such public
works must be for free and indiscriminate use by
anyone, just like the preceding enumerated
properties in the first paragraph of Art 424. The
playgrounds, however, would fit into this
category.
Law of Municipal Corporations
On the other hand, applying the norm obtaining
under the principles constituting the law of
Municipal Corporations, all those of the 50
properties in question which are devoted to public
service are deemed public; the rest remain
patrimonial. Under this norm, to be considered
public, it is enough that the property be held and,
devoted for governmental purposes like local
administration, public education, public health,
etc.
Final Ruling
The controversy here is more along the domains
of the Law of Municipal Corporations State vs.
Province than along that of Civil Law. If
municipal property held and devoted to public
service is in the same category as ordinary
private property, then that would mean they can
be levied upon and attached; they can even be
acquired thru adverse possession all these to
the detriment of the local community. It is wrong
to consider those properties as ordinary private
property.
Lastly, the classification of properties other than
those for public use in the municipalities as
patrimonial under Art. 424 of the Civil Code is
without prejudice to the provisions of special
laws. For purpose of this article, the principles,
obtaining under the Law of Municipal
Corporations can be considered as special
laws. Hence, the classification of municipal
property devoted for distinctly governmental
purposes as public should prevail over the Civil
Code classification in this particular case.
Chavez v. Pea and Amari
Fact:
1.) In 1973, the Comissioner on Public
Highways entered into a contract to reclaim areas
of Manila Bay with the Construction and
Development Corportion of the Philippines
(CDCP).
2.) PEA (Public Estates Authority) was
created by President Marcos under P.D. 1084,
tasked with developing and leasing reclaimed
lands.
3.) These lands were transferred to the care
of PEA under P.D. 1085 as part of the Manila
Cavite Road and Reclamation Project (MCRRP).
CDCP and PEA entered into an agreement that
all future projects under the MCRRP would be
funded and owned by PEA.
4.) By 1988, President Aquino issued
Special Patent No. 3517 transferring lands to
PEA. It was followed by the transfer of three Titles
(7309, 7311 and 7312) by the Register of Deeds
of Paranaque to PEA covering the three
reclaimed islands known as the FREEDOM
ISLANDS.
5.) Subsquently, PEA entered into a joint
venture agreement (JVA) with AMARI, a Thai-
Philippine corporation to develop the Freedom
Islands. Along with another 250 hectares, PEA
and AMARI entered the JVA which would later
transfer said lands to AMARI.
6.) This caused a stir especially when Sen.
Maceda assailed the agreement, claiming that
such lands were part of public domain (famously
known as the mother of all scams).
7.) Peitioner Frank J. Chavez filed case as a
taxpayer praying for mandamus, a writ of
preliminary injunction and a TRO against the sale
of reclaimed lands by PEA to AMARI and from
implementing the JVA. Following these events,
under President Estradas admin, PEA and
AMARI entered into an Amended JVA and Mr.
Chaves claim that the contract is null and void.
Issue:
w/n: the transfer to AMARI lands reclaimed or to
be reclaimed as part of the stipulations in the
(Amended) JVA between AMARI and PEA violate
Sec. 3 Art. XII of the 1987 Constitution
w/n: the court is the proper forum for raising the
issue of whether the amended joint venture
agreement is grossly disadvantageous to the
government.
Held:
reclaimed lands as alienable or disposable, and
further declare them no longer needed for public
service. Still, the transfer of such reclaimed
alienable lands of the public domain to AMARI will
be void in view of Section 3, Article XII of the
1987Constitution which prohibits private
corporations from acquiring any kind of alienable
land of the public domain.

On the issue of Amended JVA as violating the

constitution:
1. The 157.84 hectares of reclaimed lands
comprising the Freedom Islands, now covered by
certificates of title in the name of PEA, are
alienable lands of the public domain. PEA may
lease these lands to private corporations but may
not sell or transfer ownership of these lands to
private corporations. PEA may only sell these
lands to Philippine citizens, subject to the
ownership limitations in the 1987 Constitution and
existing laws.

2. The 592.15 hectares of submerged areas of

Manila Bay remain inalienable natural resources
of the public domain until classified as alienable
or disposable lands open to disposition and
declared no longer needed for public service. The
government can make such classification and
declaration only after PEA has reclaimed these
submerged areas. Only then can these lands
qualify as agricultural lands of the public domain,
\

which are the only natural resources the

government can alienate. In their present state,
the 592.15 hectares of submerged areas are
inalienable and outside the commerce of man.

3. Since the Amended JVA seeks to transfer to

AMARI, a private corporation, ownership of 77.34
hectares110 of the Freedom Islands, such
transfer is void for being contrary to Section 3,
Article XII of the 1987 Constitution which prohibits
private corporations from acquiring any kind of
alienable land of the public domain.

4. Since the Amended JVA also seeks to transfer

to AMARI ownership of 290.156 hectares111 of
still submerged areas of Manila Bay, such
transfer is void for being contrary to Section 2,
Article XII of the 1987 Constitution which prohibits
the alienation of natural resources other than
agricultural lands of the public domain.

PEA may reclaim these submerged areas.

Thereafter, the government can classify the