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G.R. No. 81958 June 30, 1988 It is admitted that Department Order No.

1 is in
the nature of a police power measure. The only
PHILIPPINE ASSOCIATION OF SERVICE question is whether or not it is valid under the
EXPORTERS, INC., petitioner, Constitution.
HON. FRANKLIN M. DRILON as Secretary of The concept of police power is well-established in
Labor and Employment, and TOMAS D. this jurisdiction. It has been defined as the "state
ACHACOSO, as Administrator of the Philippine authority to enact legislation that may interfere
Overseas Employment with personal liberty or property in order to
Administration, respondents. promote the general welfare." 5 As defined, it
consists of (1) an imposition of restraint upon
SARMIENTO, J.: liberty or property, (2) in order to foster the
common good. It is not capable of an exact
The petitioner, Philippine Association of Service definition but has been, purposely, veiled in
Exporters, Inc. (PASEI, for short), a firm "engaged general terms to underscore its all-comprehensive
principally in the recruitment of Filipino workers, embrace.
male and female, for overseas
placement," 1 challenges the Constitutional validity "Its scope, ever-expanding to meet the exigencies of
of Department Order No. 1, Series of 1988, of the the times, even to anticipate the future where it
Department of Labor and Employment, in the could be done, provides enough room for an
character of "GUIDELINES GOVERNING THE efficient and flexible response to conditions and
TEMPORARY SUSPENSION OF DEPLOYMENT OF circumstances thus assuring the greatest
WORKERS," in this petition for certiorari and
prohibition. Specifically, the measure is assailed It finds no specific Constitutional grant for the
for "discrimination against males or females;" 2 that plain reason that it does not owe its origin to the
it "does not apply to all Filipino workers but only to Charter. Along with the taxing power and eminent
domestic helpers and females with similar domain, it is inborn in the very fact of statehood
skills;" 3 and that it is violative of the right to and sovereignty. It is a fundamental attribute of
travel. It is held likewise to be an invalid exercise of government that has enabled it to perform the
the lawmaking power, police power being most vital functions of governance. Marshall, to
legislative, and not executive, in character. whom the expression has been credited, 7 refers to
it succinctly as the plenary power of the State "to
In its supplement to the petition, PASEI invokes govern its citizens." 8
Section 3, of Article XIII, of the Constitution,
providing for worker participation "in policy and "The police power of the State ... is a power
decision-making processes affecting their rights coextensive with self- protection, and it is not
and benefits as may be provided by inaptly termed the "law of overwhelming necessity."
law." 4 Department Order No. 1, it is contended, It may be said to be that inherent and plenary
was passed in the absence of prior consultations. It power in the State which enables it to prohibit all
is claimed, finally, to be in violation of the things hurtful to the comfort, safety, and welfare of
Charter's non-impairment clause, in addition to society." 9
the "great and irreparable injury" that PASEI
members face should the Order be further It constitutes an implied limitation on the Bill of
enforced. Rights. According to Fernando, it is "rooted in the
conception that men in organizing the state and
On May 25, 1988, the Solicitor General, on behalf imposing upon its government limitations to
of the respondents Secretary of Labor and safeguard constitutional rights did not intend
Administrator of the Philippine Overseas thereby to enable an individual citizen or a group
Employment Administration, filed a Comment of citizens to obstruct unreasonably the enactment
informing the Court that on March 8, 1988, the of such salutary measures calculated to ensure
respondent Labor Secretary lifted the deployment communal peace, safety, good order, and
ban in the states of Iraq, Jordan, Qatar, Canada, welfare." 10 Significantly, the Bill of Rights itself
Hongkong, United States, Italy, Norway, Austria, does not purport to be an absolute guaranty of
and Switzerland. * In submitting the validity of the individual rights and liberties "Even liberty itself,
challenged "guidelines," the Solicitor General the greatest of all rights, is not unrestricted license
invokes the police power of the Philippine State. to act according to one's will." 11 It is subject to the
far more overriding demands and requirements of
the greater number.
Notwithstanding its extensive sweep, police power chauvinistic notion that men are superior to
is not without its own limitations. For all its women. What the Court is saying is that it was
awesome consequences, it may not be exercised largely a matter of evidence (that women domestic
arbitrarily or unreasonably. Otherwise, and in that workers are being ill-treated abroad in massive
event, it defeats the purpose for which it is instances) and not upon some fanciful or arbitrary
exercised, that is, to advance the public good. yardstick that the Government acted in this case.
Thus, when the power is used to further private It is evidence capable indeed of unquestionable
interests at the expense of the citizenry, there is a demonstration and evidence this Court accepts.
clear misuse of the power. 12 The Court cannot, however, say the same thing as
far as men are concerned. There is simply no
In the light of the foregoing, the petition must be evidence to justify such an inference. Suffice it to
dismissed. state, then, that insofar as classifications are
concerned, this Court is content that distinctions
As a general rule, official acts enjoy a presumed are borne by the evidence. Discrimination in this
vahdity. 13 In the absence of clear and convincing case is justified.
evidence to the contrary, the presumption logically
stands. As we have furthermore indicated, executive
determinations are generally final on the Court.
The petitioner has shown no satisfactory reason Under a republican regime, it is the executive
why the contested measure should be nullified. branch that enforces policy. For their part, the
There is no question that Department Order No. 1 courts decide, in the proper cases, whether that
applies only to "female contract workers," 14 but it policy, or the manner by which it is implemented,
does not thereby make an undue discrimination agrees with the Constitution or the laws, but it is
between the sexes. It is well-settled that "equality not for them to question its wisdom. As a co-equal
before the law" under the Constitution 15does not body, the judiciary has great respect for
import a perfect Identity of rights among all men determinations of the Chief Executive or his
and women. It admits of classifications, provided subalterns, especially when the legislature itself
that (1) such classifications rest on substantial has specifically given them enough room on how
distinctions; (2) they are germane to the purposes the law should be effectively enforced. In the case
of the law; (3) they are not confined to existing at bar, there is no gainsaying the fact, and the
conditions; and (4) they apply equally to all Court will deal with this at greater length shortly,
members of the same class. 16 that Department Order No. 1 implements the rule-
making powers granted by the Labor Code. But
what should be noted is the fact that in spite of
The Court is satisfied that the classification made- such a fiction of finality, the Court is on its own
the preference for female workers — rests on persuaded that prevailing conditions indeed call for
substantial distinctions. a deployment ban.

As a matter of judicial notice, the Court is well There is likewise no doubt that such a
aware of the unhappy plight that has befallen our classification is germane to the purpose behind the
female labor force abroad, especially domestic measure. Unquestionably, it is the avowed
servants, amid exploitative working conditions objective of Department Order No. 1 to "enhance
marked by, in not a few cases, physical and the protection for Filipino female overseas
personal abuse. The sordid tales of maltreatment workers" 17 this Court has no quarrel that in the
suffered by migrant Filipina workers, even rape midst of the terrible mistreatment Filipina workers
and various forms of torture, confirmed by have suffered abroad, a ban on deployment will be
testimonies of returning workers, are compelling for their own good and welfare.
motives for urgent Government action. As precisely
the caretaker of Constitutional rights, the Court is
called upon to protect victims of exploitation. In The Order does not narrowly apply to existing
fulfilling that duty, the Court sustains the conditions. Rather, it is intended to apply
Government's efforts. indefinitely so long as those conditions exist. This
is clear from the Order itself ("Pending review of the
administrative and legal measures, in the
The same, however, cannot be said of our male Philippines and in the host countries . . ." 18),
workers. In the first place, there is no evidence meaning to say that should the authorities arrive
that, except perhaps for isolated instances, our at a means impressed with a greater degree of
men abroad have been afflicted with an Identical permanency, the ban shall be lifted. As a stop-gap
predicament. The petitioner has proffered no measure, it is possessed of a necessary
argument that the Government should act malleability, depending on the circumstances of
similarly with respect to male workers. The Court, each case. Accordingly, it provides:
of course, is not impressing some male
Secretary of Labor and Employment deployment of domestic helpers and
(DOLE) may, upon recommendation workers of similar skills defined
of the Philippine Overseas herein to the following [sic] are
Employment Administration (POEA), authorized under these guidelines
lift the suspension in countries and are exempted from the
where there are: suspension.

1. Bilateral agreements or 5.1 Hirings by

understanding with the Philippines, immediate members
and/or, of the family of Heads
of State and
2. Existing mechanisms providing Government;
for sufficient safeguards to ensure
the welfare and protection of Filipino 5.2 Hirings by
workers. 19 Minister, Deputy
Minister and the
The Court finds, finally, the impugned guidelines other senior
to be applicable to all female domestic overseas government officials;
workers. That it does not apply to "all Filipina and
workers" 20 is not an argument for
unconstitutionality. Had the ban been given 5.3 Hirings by senior
universal applicability, then it would have been officials of the
unreasonable and arbitrary. For obvious reasons, diplomatic corps and
not all of them are similarly circumstanced. What duly accredited
the Constitution prohibits is the singling out of a international
select person or group of persons within an organizations.
existing class, to the prejudice of such a person or
group or resulting in an unfair advantage to 5.4 Hirings by
another person or group of persons. To apply the employers in
ban, say exclusively to workers deployed by A, but countries with whom
not to those recruited by B, would obviously clash the Philippines have
with the equal protection clause of the Charter. It [sic] bilateral labor
would be a classic case of what Chase refers to as agreements or
a law that "takes property from A and gives it to understanding.
B." 21 It would be an unlawful invasion of property
rights and freedom of contract and needless to xxx xxx xxx
state, an invalid act. 22 (Fernando says: "Where the
classification is based on such distinctions that
make a real difference as infancy, sex, and stage of
civilization of minority groups, the better rule, it
would seem, is to recognize its validity only if the
domestic helpers and/or workers of
young, the women, and the cultural minorities are
similar skills shall be allowed to
singled out for favorable treatment. There would be
process with the POEA and leave for
an element of unreasonableness if on the contrary
worksite only if they are returning to
their status that calls for the law ministering to
the same employer to finish an
their needs is made the basis of discriminatory
existing or partially served
legislation against them. If such be the case, it
employment contract. Those
would be difficult to refute the assertion of denial
workers returning to worksite to
of equal protection." 23 In the case at bar, the
serve a new employer shall be
assailed Order clearly accords protection to certain
covered by the suspension and the
women workers, and not the contrary.)
provision of these guidelines.
It is incorrect to say that Department Order No. 1
xxx xxx xxx
prescribes a total ban on overseas deployment.
From scattered provisions of the Order, it is
evident that such a total ban has hot been 9. LIFTING OF SUSPENSION-The
contemplated. We quote: Secretary of Labor and Employment
(DOLE) may, upon recommendation
of the Philippine Overseas
Employment Administration (POEA), employment and equality of
lift the suspension in countries employment opportunities for all. 30
where there are:
"Protection to labor" does not signify the promotion
1. Bilateral of employment alone. What concerns the
agreements or Constitution more paramountly is that such an
understanding with employment be above all, decent, just, and
the Philippines, humane. It is bad enough that the country has to
and/or, send its sons and daughters to strange lands
because it cannot satisfy their employment needs
2. Existing at home. Under these circumstances, the
mechanisms Government is duty-bound to insure that our
providing for toiling expatriates have adequate protection,
sufficient safeguards personally and economically, while away from
to ensure the welfare home. In this case, the Government has evidence,
and protection of an evidence the petitioner cannot seriously
Filipino workers. 24 dispute, of the lack or inadequacy of such
protection, and as part of its duty, it has precisely
xxx xxx xxx ordered an indefinite ban on deployment.

The consequence the deployment ban has on the The Court finds furthermore that the Government
right to travel does not impair the right. The right has not indiscriminately made use of its authority.
to travel is subject, among other things, to the It is not contested that it has in fact removed the
requirements of "public safety," "as may be prohibition with respect to certain countries as
provided by law." 25 Department Order No. 1 is a manifested by the Solicitor General.
valid implementation of the Labor Code, in
particular, its basic policy to "afford protection to The non-impairment clause of the Constitution,
labor," 26 pursuant to the respondent Department invoked by the petitioner, must yield to the loftier
of Labor's rule-making authority vested in it by the purposes targetted by the Government. 31 Freedom
Labor Code. 27 The petitioner assumes that it is of contract and enterprise, like all other freedoms,
unreasonable simply because of its impact on the is not free from restrictions, more so in this
right to travel, but as we have stated, the right jurisdiction, where laissez faire has never been
itself is not absolute. The disputed Order is a valid fully accepted as a controlling economic way of life.
qualification thereto.
This Court understands the grave implications the
Neither is there merit in the contention that questioned Order has on the business of
Department Order No. 1 constitutes an invalid recruitment. The concern of the Government,
exercise of legislative power. It is true that police however, is not necessarily to maintain profits of
power is the domain of the legislature, but it does business firms. In the ordinary sequence of events,
not mean that such an authority may not be it is profits that suffer as a result of Government
lawfully delegated. As we have mentioned, the regulation. The interest of the State is to provide a
Labor Code itself vests the Department of Labor decent living to its citizens. The Government has
and Employment with rulemaking powers in the convinced the Court in this case that this is its
enforcement whereof. 28 intent. We do not find the impugned Order to be
tainted with a grave abuse of discretion to warrant
The petitioners's reliance on the Constitutional the extraordinary relief prayed for.
guaranty of worker participation "in policy and
decision-making processes affecting their rights WHEREFORE, the petition is DISMISSED. No
and benefits" 29 is not well-taken. The right granted costs.
by this provision, again, must submit to the
demands and necessities of the State's power of SO ORDERED.

The Constitution declares that: EMILIO GANCAYCO V. CITY GOV’T OF Q.C. AND
Sec. 3. The State shall afford full DECISION
protection to labor, local and
overseas, organized and
unorganized, and promote full SERENO, J.:
Before us are consolidated Petitions for not allowed to construct his wall up to the edge of
Review under Rule 45 of the Rules of Court the property line, thereby creating a space or
assailing the Decision promulgated on 18 July shelter under the first floor. In effect, property
2006 and the Resolution dated 10 May 2007of owners relinquish the use of the space for use as
the Court of Appeals in CA-G.R. SP No. 84648. an arcade for pedestrians, instead of using it for
The Facts their own purposes.

In the early 1950s, retired Justice Emilio A. The ordinance was amended several times.
Gancayco bought a parcel of land located at 746 On 8 August 1960, properties located at the
Epifanio delos Santos Avenue (EDSA), Quezon Quezon City-San Juan boundary were exempted by
City with an area of 375 square meters and Ordinance No. 60-4477 from the construction of
covered by Transfer Certificate of Title (TCT) No. arcades. This ordinance was further amended by
RT114558. Ordinance No. 60-4513, extending the exemption
to commercial buildings from Balete
On 27 March 1956, the Quezon Street to Seattle Street. Ordinance No. 6603
City Council issued Ordinance No. 2904, entitled dated 1 March 1966 meanwhile reduced the width
An Ordinance Requiring the Construction of of the arcades to three meters for buildings
Arcades, for Commercial Buildings to be along V. Luna Road, Central District, Quezon City.
Constructed in Zones Designated as Business
Zones in the Zoning Plan of Quezon City, and The ordinance covered the property of
Providing Penalties in Violation Thereof. Justice Gancayco. Subsequently, sometime in
1965, Justice Gancayco sought the exemption of a
An arcade is defined as any portion of a two-storey building being constructed on his
building above the first floor projecting over the property from the application of Ordinance No.
sidewalk beyond the first storey wall used as 2904 that he be exempted from constructing an
protection for pedestrians against rain or sun.[5] arcade on his property.

Ordinance No. 2904 required the relevant On 2 February 1966, the City Council
property owner to construct an arcade with a width acted favorably on Justice Gancaycos request and
of 4.50 meters and height of 5.00 meters along issued Resolution No. 7161, S-66, subject to the
EDSA, from the north side of Santolan Road to one condition that upon notice by the City Engineer,
lot after Liberty Avenue, and from one lot the owner shall, within reasonable time, demolish
before Central Boulevard to the Botocan the enclosure of said arcade at his own expense
transmission line. when public interest so demands.[6]

At the outset, it bears emphasis that at the Decades after, in March 2003, the
time Ordinance No. 2904 was passed by the city Metropolitan Manila Development Authority
council, there was yet no building code passed by (MMDA) conducted operations to clear obstructions
the national legislature. Thus, the regulation of the along the sidewalk of EDSA in Quezon City
construction of buildings was left to the discretion pursuant to Metro Manila Councils (MMC)
of local government units. Under this particular Resolution No. 02-28, Series of 2002. [7] The
ordinance, the city council required that the arcade resolution authorized the MMDA and local
is to be created by constructing the wall of the government units to clear the sidewalks, streets,
ground floor facing the sidewalk a few meters away avenues, alleys, bridges, parks and other public
from the property line. Thus, the building owner is
places in Metro Manila of all illegal structures and he prayed for the payment of just compensation
obstructions. should the court hold the ordinance valid.

On 28 April 2003, the MMDA sent a notice The City Government of Quezon City
of demolition to Justice Gancayco alleging that a claimed that the ordinance was a valid exercise of
portion of his building violated the National police power, regulating the use of property in a
Building Code of the Philippines (Building Code) business zone. In addition, it pointed out that
in relation to Ordinance No. 2904. The MMDA Justice Gancayco was already barred by estoppel,
gave Justice Gancayco fifteen (15) days to clear the laches and prescription.
portion of the building that was supposed to be an
arcade along EDSA.[10] Similarly, the MMDA alleged that Justice
Gancayco could not seek the nullification of an
Justice Gancayco did not comply with the ordinance that he had already violated, and that
notice. Soon after the lapse of the fifteen (15) days, the ordinance enjoyed the presumption of
the MMDA proceeded to demolish the party wall, or constitutionality. It further stated that the
what was referred to as the wing walls, of the questioned property was a public nuisance
ground floor structure. The records of the present impeding the safe passage of pedestrians. Finally,
case are not entirely clear on the extent of the the MMDA claimed that it was merely
demolition; nevertheless, the fact of demolition was implementing the legal easement established by
not disputed. At the time of the demolition, the Ordinance No. 2904.[13]
affected portion of the building was being used as a
restaurant. The RTC rendered its Decision on 30
September 2003 in favor of Justice Gancayco.[14] It
On 29 May 2003, Justice Gancayco filed a held that the questioned ordinance was
Petition with prayer for a temporary restraining unconstitutional, ruling that it allowed the taking
order and/or writ of preliminary injunction before of private property for public use without just
the Regional Trial Court (RTC) of Quezon City, compensation. The RTC said that because 67.5
docketed as Civil Case No. Q03-49693, seeking to square meters out of Justice Gancaycos 375
prohibit the MMDA and the City Government of square meters of property were being taken
Quezon City from demolishing his property. In his without compensation for the publics benefit, the
Petition, he alleged that the ordinance ordinance was confiscatory and oppressive. It
authorized the taking of private property without likewise held that the ordinance violated owners
due process of law and just compensation, because right to equal protection of laws. The dispositive
the construction of an arcade will require 67.5 portion thus states:
square meters from the 375 square meter property.
WHEREFORE, the petition is
In addition, he claimed that the ordinance was hereby granted and the Court
selective and discriminatory in its scope and hereby declares Quezon City
Ordinance No. 2094,[15] Series of
application when it allowed the owners of the 1956 to be unconstitutional, invalid
buildings located in the Quezon City-San Juan and void ab initio. The respondents
boundary to Cubao Rotonda, and Balete to Seattle are hereby permanently enjoined
from enforcing and implementing
Streets to construct arcades at their option. He the said ordinance, and the
thus sought the declaration of nullity of Ordinance respondent MMDA is hereby
directed to immediately restore the
No. 2904 and the payment of damages. Alternately, portion of the party wall or wing wall
of the building of the petitioner it avenues, alleys, bridges, parks and other public
destroyed to its original condition.
places in Metro Manila, thus excluding Justice
IT IS SO ORDERED. Gancaycos private property. Lastly, the CA stated
that the MMDA is not clothed with the authority to
The MMDA thereafter appealed from the
declare, prevent or abate nuisances. Thus, the
Decision of the trial court. On 18 July 2006, the
dispositive portion stated:
Court of Appeals (CA) partly granted the appeal.
The CA upheld the validity of Ordinance No. WHEREFORE, the appeals
2904 and lifted the injunction against the The Decision dated September 30,
enforcement and implementation of the ordinance. 2003 of the Regional Trial Court,
In so doing, it held that the ordinance was a valid Branch 224, Quezon City,
is MODIFIED, as follows:
exercise of the right of the local government unit to 1) The validity and constitutionality
promote the general welfare of its constituents of Ordinance No. 2094,[18] Series of
1956, issued by the City Council of
pursuant to its police powers. The CA also ruled Quezon City, is UPHELD; and
that the ordinance established a valid classification 2) The injunction against the
enforcement and implementation of
of property owners with regard to the construction
the said Ordinance is LIFTED.
of arcades in their respective properties depending SO ORDERED.
on the location. The CA further stated that there
was no taking of private property, since the owner
This ruling prompted the MMDA and
still enjoyed the beneficial ownership of the
Justice Gancayco to file their respective Motions
property, to wit:
for Partial Reconsideration.[19]
Even with the requirement of
the construction of arcaded On 10 May 2007, the CA denied the
sidewalks within his commercial lot,
appellee still retains the beneficial motions stating that the parties did not present
ownership of the said property. new issues nor offer grounds that would merit the
Thus, there is no taking for public reconsideration of the Court.[20]
use which must be subject to just
compensation. While the arcaded
sidewalks contribute to the public Dissatisfied with the ruling of the CA,
good, for providing safety and Justice Gancayco and the MMDA filed their
comfort to passersby, the ultimate
benefit from the same still redounds respective Petitions for Review before this Court.
to appellee, his commercial The issues raised by the parties are summarized as
establishment being at the forefront
of a busy thoroughfare like EDSA.
The arcaded sidewalks, by their
nature, assure clients of the
commercial establishments thereat GANCAYCO WAS ESTOPPED
some kind of protection from FROM ASSAILING THE VALIDITY
accidents and other hazards. OF ORDINANCE NO. 2904.
Without doubt, this sense of II. WHETHER OR NOT
protection can be a boon to the ORDINANCE NO. 2904 IS
business activity therein engaged. [17] CONSTITUTIONAL.
Nevertheless, the CA held that the MMDA BUILDING IS A PUBLIC NUISANCE.
went beyond its powers when it demolished the
subject property. It further found that Resolution PROPERTY OF JUSTICE
No. 02-28 only refers to sidewalks, streets, GANCAYCO.
cannot be given any effect. The
doctrine of estoppel cannot
The Courts Ruling operate to give effect to an act
Estoppel which is otherwise null and void
or ultra vires. (Emphasis supplied.)

The MMDA and the City Government of Quezon Recently, in British American Tobacco v.
City both claim that Justice Gancayco was Camacho,[22] we likewise held:
estopped from challenging the ordinance, because,
We find that petitioner was
in 1965, he asked for an exemption from the not guilty of estoppel. When it made
application of the ordinance. According to them, the undertaking to comply with all
issuances of the BIR, which at that
Justice Gancayco thereby recognized the power of
time it considered as valid,
the city government to regulate the construction of petitioner did not commit any false
buildings. misrepresentation or misleading act.
Indeed, petitioner cannot be faulted
for initially undertaking to comply
To recall, Justice Gancayco questioned the with, and subjecting itself to the
constitutionality of the ordinance on two grounds: operation of Section 145(C), and
only later on filing the subject case
(1) whether the ordinance takes private property praying for the declaration of its
without due process of law and just compensation; unconstitutionality when the
and (2) whether the ordinance violates the equal circumstances change and the law
results in what it perceives to be
protection of rights because it allowed exemptions unlawful discrimination. The mere
from its application. fact that a law has been relied
upon in the past and all that time
has not been attacked as
On the first ground, we find that Justice unconstitutional is not a ground
Gancayco may still question the constitutionality of for considering petitioner
estopped from assailing its
the ordinance to determine whether or not the
validity. For courts will pass upon
ordinance constitutes a taking of private property a constitutional question only
without due process of law and just compensation. when presented before it in bona
fide cases for determination, and
It was only in 2003 when he was allegedly deprived the fact that the question has not
of his property when the MMDA demolished a been raised before is not a valid
reason for refusing to allow it to
portion of the building. Because he was granted an
be raised later. (Emphasis
exemption in 1966, there was no taking yet to supplied.)
speak of.

Moreover, in Acebedo Optical Company, Inc. Anent the second ground, we find that
v. Court of Appeals,[21] we held: Justice Gancayco may not question the ordinance
on the ground of equal protection when he also
It is therefore decisively clear
benefited from the exemption. It bears emphasis
that estoppel cannot apply in this
case. The fact that petitioner that Justice Gancayco himself requested for an
acquiesced in the special conditions exemption from the application of the ordinance in
imposed by the City Mayor in
subject business permit does not 1965 and was eventually granted one. Moreover,
preclude it from challenging the said he was still enjoying the exemption at the time of
imposition, which is ultra vires or
the demolition as there was yet no valid notice
beyond the ambit of authority of
respondent City Mayor. Ultra from the city engineer. Thus, while the ordinance
vires acts or acts which are may be attacked with regard to its different
clearly beyond the scope of one's
authority are null and void and treatment of properties that appears to be similarly
situated, Justice Gancayco is not the proper Act No. 537, or the Revised Charter of Quezon City,
person to do so. which states:

Zoning and the regulation of the To make such further

construction of buildings are valid ordinances and regulations not
exercises of police power . repugnant to law as may be
necessary to carry into effect and
discharge the powers and duties
In MMDA v. Bel-Air Village Association, [23] we
conferred by this Act and such as it
discussed the nature of police powers exercised by shall deem necessary and proper to
local government units, to wit: provide for the health and safety,
promote the prosperity, improve the
Police power is an inherent morals, peace, good order, comfort,
attribute of sovereignty. It has been and convenience of the city and the
defined as the power vested by the inhabitants thereof, and for the
Constitution in the legislature to protection of property therein; and
make, ordain, and establish all enforce obedience thereto with such
manner of wholesome and lawful fines or penalties as the City
reasonable laws, statutes and Council may prescribe under the
ordinances, either with penalties or provisions of subsection (jj) of this
without, not repugnant to the section.
Constitution, as they shall judge to
be for the good and welfare of the
commonwealth, and for the subjects Specifically, on the powers of the city
of the same. The power is plenary
government to regulate the construction of
and its scope is vast and pervasive,
reaching and justifying measures for buildings, the Charter also expressly provided that
public health, public safety, public the city government had the power to regulate the
morals, and the general welfare.
kinds of buildings and structures that may be
It bears stressing that police erected within fire limits and the manner of
power is lodged primarily in the
National Legislature. It cannot be constructing and repairing them.[25]
exercised by any group or body of
individuals not possessing With regard meanwhile to the power of the
legislative power. The National local government units to issue zoning ordinances,
Legislature, however, may delegate
this power to the President and we apply Social Justice Society v. Atienza.[26] In that
administrative boards as well as the case, the Sangguniang
lawmaking bodies of municipal
corporations or local government Panlungsod of Manila City enacted an ordinance
units. Once delegated, the agents on 28 November 2001 reclassifying certain areas of
can exercise only such legislative
the city from industrial to commercial. As a result
powers as are conferred on them by
the national lawmaking body. of the zoning ordinance, the oil terminals located in
those areas were no longer allowed. Though the oil
To resolve the issue on the constitutionality companies contended that they stood to lose
of the ordinance, we must first determine whether billions of pesos, this Court upheld the power of
there was a valid delegation of police power. Then the city government to pass the assailed ordinance,
we can determine whether the City Government of stating:
Quezon City acted within the limits of the
In the exercise of police
power, property rights of individuals
may be subjected to restraints and
It is clear that Congress expressly granted burdens in order to fulfil the
the city government, through the city council, objectives of the government.
Otherwise stated, the government
police power by virtue of Section 12(oo) of Republic may enact legislation that may
interfere with personal liberty, questioned provision is
property, lawful businesses and invalidated. Moreover, in the
occupations to promote the absence of evidence
general welfare. However, the demonstrating the alleged
interference must be reasonable confiscatory effect of the
and not arbitrary. And to forestall provision in question, there is no
arbitrariness, the methods or basis for its nullification in view
means used to protect public of the presumption of validity
health, morals, safety or welfare which every law has in its
must have a reasonable relation favor. (Emphasis supplied.)
to the end in view.
The means adopted by
the Sanggunian was the enactment In the case at bar, it is clear that the
of a zoning ordinance which
reclassified the area where the depot primary objectives of the city council of Quezon
is situated from industrial to City when it issued the questioned ordinance
commercial. A zoning ordinance is
defined as a local city or ordering the construction of arcades were the
municipal legislation which health and safety of the city and its inhabitants;
logically arranges, prescribes,
the promotion of their prosperity; and the
defines and apportions a given
political subdivision into specific improvement of their morals, peace, good order,
land uses as present and future comfort, and the convenience. These arcades
projection of needs. As a result of
the zoning, the continued operation provide safe and convenient passage along the
of the businesses of the oil sidewalk for commuters and pedestrians, not just
companies in their present location
the residents of Quezon City. More especially so
will no longer be permitted. The
power to establish zones for because the contested portion of the building is
industrial, commercial and located on a busy segment of the city, in a
residential uses is derived from
the police power itself and is business zone along EDSA.
exercised for the protection and
benefit of the residents of a Corollarily, the policy of the Building Code,
locality. Consequently, the [28]
which was passed after the Quezon City
enactment of Ordinance No. 8027 is
within the power of Ordinance, supports the purpose for the
the Sangguniang Panlungsod of the enactment of Ordinance No. 2904. The Building
City of Manila and any resulting
burden on those affected cannot be Code states:
said to be unjust... (Emphasis
supplied) Section 102. Declaration of Policy. It
is hereby declared to be the policy of
the State to safeguard life, health,
property, and public welfare,
In Carlos Superdrug v. Department of Social consistent with the principles of
sound environmental management
Welfare and Development,[27] we also held: and control; and to this end, make it
For this reason, when the the purpose of this Code to provide
conditions so demand as determined for all buildings and structures, a
by the legislature, property rights framework of minimum standards
must bow to the primacy of police and requirements to regulate and
power because property rights, control their location, site, design
though sheltered by due process, quality of materials, construction,
must yield to general welfare. occupancy, and maintenance.
Police power as an
attribute to promote the common
good would be diluted Section 1004 likewise requires the
considerably if on the mere plea
of petitioners that they will suffer construction of arcades whenever existing or
loss of earnings and capital, the zoning ordinances require it. Apparently, the law
allows the local government units to determine any public highway or street, or any body of water;
whether arcades are necessary within their or, (5) hinders or impairs the use of property. A
respective jurisdictions. nuisance may be per se or per accidens. A
nuisance per se is that which affects the immediate
Justice Gancayco argues that there is a safety of persons and property and may summarily
three-meter sidewalk in front of his property line, be abated under the undefined law of necessity.[29]
and the arcade should be constructed above that
sidewalk rather than within his property line. We Clearly, when Justice Gancayco was given a
do not need to address this argument inasmuch as permit to construct the building, the city council or
it raises the issue of the wisdom of the city the city engineer did not consider the building, or
ordinance, a matter we will not and need not delve its demolished portion, to be a threat to the safety
into. of persons and property. This fact alone should
have warned the MMDA against summarily
To reiterate, at the time that the ordinance demolishing the structure.
was passed, there was no national building code
enforced to guide the city council; thus, there was Neither does the MMDA have the power to
no law of national application that prohibited the declare a thing a nuisance. Only courts of law have
city council from regulating the construction of the power to determine whether a thing is a
buildings, arcades and sidewalks in their nuisance. In AC Enterprises v. Frabelle Properties
jurisdiction. Corp.,[30] we held:

The wing walls of the building are not We agree with petitioner's
nuisances per se. contention that, under Section
447(a)(3)(i) of R.A. No. 7160,
The MMDA claims that the portion of the building otherwise known as the Local
Government Code, the Sangguniang
in question is a nuisance per se. Panglungsod is empowered to enact
ordinances declaring, preventing or
We disagree. abating noise and other forms of
nuisance. It bears stressing,
however, that the Sangguniang
The fact that in 1966 the City Council gave Bayan cannot declare a particular
Justice Gancayco an exemption from constructing thing as a nuisance per se and order
its condemnation. It does not have
an arcade is an indication that the wing walls of
the power to find, as a fact, that a
the building are not nuisances per se.The wing particular thing is a nuisance
walls do not per se immediately and adversely when such thing is not a
nuisance per se; nor can it
affect the safety of persons and property. The fact authorize the extrajudicial
that an ordinance may declare a structure illegal condemnation and destruction of
that as a nuisance which in its
does not necessarily make that structure a
nature, situation or use is not
nuisance. such. Those things must be
determined and resolved in the
Article 694 of the Civil Code defines ordinary courts of law. If a thing be
in fact, a nuisance due to the
nuisance as any act, omission, establishment, manner of its operation, that
business, condition or property, or anything else question cannot be determined by a
mere resolution of the Sangguniang
that (1) injures or endangers the health or safety of
Bayan. (Emphasis supplied.)
others; (2) annoys or offends the senses; (3)
shocks, defies or disregards decency or morality;
(4) obstructs or interferes with the free passage of
MMDA illegally demolished charged with the duties of issuing
the property of Justice Gancayco. building permits.

MMDA alleges that by virtue of MMDA In the performance of his duties, a

Building Official may enter any
Resolution No. 02-28, Series of 2002, it is building or its premises at all
empowered to demolish Justice Gancaycos reasonable times to inspect and
determine compliance with the
property. It insists that the Metro Manila Council requirements of this Code, and the
authorized the MMDA and the local government terms and conditions provided for in
the building permit as issued.
units to clear the sidewalks, streets, avenues,
alleys, bridges, parks and other public places in When any building work is found
Metro Manila of all illegal structures and to be contrary to the provisions of
this Code, the Building Official
obstructions. It further alleges that it demolished may order the work stopped and
the property pursuant to the Building Code in prescribe the terms and/or
conditions when the work will be
relation to Ordinance No. 2904 as amended.
allowed to resume. Likewise, the
Building Official is authorized to
However, the Building Code clearly provides order the discontinuance of the
the process by which a building may be occupancy or use of any building
or structure or portion thereof
demolished. The authority to order the demolition found to be occupied or used
of any structure lies with the Building Official. The contrary to the provisions of this
pertinent provisions of the Building Code provide:
xxx xxx xxx
SECTION 205. Building Officials.
Except as otherwise provided herein,
SECTION 215. Abatement of
the Building Official shall be
Dangerous Buildings. When any
responsible for carrying out the
building or structure is found or
provisions of this Code in the field
declared to be dangerous or
as well as the enforcement of orders
ruinous, the Building Official
and decisions made pursuant
shall order its repair, vacation or
demolition depending upon the
degree of danger to life, health,
Due to the exigencies of the service,
or safety. This is without
the Secretary may designate
prejudice to further action that
incumbent Public Works District
may be taken under the
Engineers, City Engineers and
provisions of Articles 482 and
Municipal Engineers act as Building
694 to 707 of the Civil Code of
Officials in their respective areas of
the Philippines. (Emphasis
The designation made by the
Secretary under this Section shall
continue until regular positions of
Building Official are provided or MMDA v. Trackworks Rail Transit
unless sooner terminated for causes Advertising, Vending and Promotions, Inc. [31] is
provided by law or decree.
applicable to the case at bar. In that case, MMDA,
xxx xxx xxx invoking its charter and the Building Code,
summarily dismantled the advertising media
SECTION 207. Duties of a Building
Official. In his respective territorial installed on the Metro Rail Transit (MRT) 3. This
jurisdiction, the Building Official Court held:
shall be primarily responsible for It is futile for MMDA to
the enforcement of the provisions of simply invoke its legal mandate to
this Code as well as of the justify the dismantling of
implementing rules and regulations Trackworks' billboards, signages
issued therefor. He is the official and other advertising media. MMDA
simply had no power on its own to The Court also agrees with the CA's ruling
dismantle, remove, or destroy the
that MMDA Regulation No. 96-009 and
billboards, signages and other
advertising media installed on the MMC Memorandum Circular No. 88-09 did
MRT3 structure by Trackworks. not apply to Trackworks' billboards,
In Metropolitan Manila Development signages and other advertising media. The
Authority v. Bel-Air Village
Association, Inc., Metropolitan prohibition against posting, installation and
Manila Development Authority v. display of billboards, signages and other
Viron Transportation Co., Inc., advertising media applied only to public
and Metropolitan Manila
areas, but MRT3, being private property
Development Authority v. Garin, the
Court had the occasion to rule pursuant to the BLT agreement between
that MMDA's powers were limited the Government and MRTC, was not one
to the formulation, coordination, of the areas as to which the prohibition
regulation, implementation,
preparation, management, applied. Moreover, MMC Memorandum
monitoring, setting of policies, Circular No. 88-09 did not apply to
installing a system, and Trackworks' billboards, signages and other
administration. Nothing in advertising media in MRT3, because it did
Republic Act No. 7924 granted
MMDA police power, let alone not specifically cover MRT3, and because it
legislative power. was issued a year prior to the construction
of MRT3 on the center island of EDSA.
Clarifying the real nature of Clearly, MMC Memorandum Circular No.
MMDA, the Court held: 88-09 could not have included MRT3 in its
...The MMDA is, as termed
in the charter itself, a MMDA's insistence that it
"development authority". It is an was only implementing Presidential
agency created for the purpose of Decree No. 1096 (Building Code) and
laying down policies and its implementing rules and
coordinating with the various regulations is not persuasive. The
national government agencies, power to enforce the provisions of
people's organizations, non- the Building Code was lodged in
governmental organizations and the Department of Public Works
the private sector for the efficient and Highways (DPWH), not in
and expeditious delivery of basic MMDA, considering the law's
services in the vast metropolitan following provision, thus:
area. All its functions are
administrative in nature and Sec. 201. Responsibility for
these are actually summed up in Administration and
the charter itself, viz: Enforcement. -
The administration and
Sec.2. Creation of the enforcement of the
provisions of this Code
Metropolitan Manila Develop including the imposition of
ment Authority.- xxx. penalties for administrative
The MMDA shall perform violations thereof is hereby
planning, monitoring and vested in the Secretary of
coordinative functions, and Public Works, Transportation
in the process exercise and Communications,
regulatory and supervisory hereinafter referred to as the
authority over the delivery of "Secretary."
metro-wide services within
Metro Manila, without There is also no evidence
diminution of the autonomy showing that MMDA had been
of local government units delegated by DPWH to implement
concerning purely local the Building Code. (Emphasis
matters. supplied.)
undertaken by the MMDA only, without the
participation and/or consent of Quezon City.
Additionally, the penalty prescribed by
Therefore, the MMDA acted on its own and should
Ordinance No. 2904 itself does not include the
be held solely liable for the destruction of the
demolition of illegally constructed buildings in case
portion of Justice Gancaycos building.
of violations. Instead, it merely prescribes a
punishment of a fine of not more than two WHEREFORE, in view of the foregoing, the
hundred pesos (P200.00) or by imprisonment of Decision of the Court of Appeals in CA-G.R. SP No.
not more than thirty (30) days, or by both such 84648 is AFFIRMED.
fine and imprisonment at the discretion of the
Court, Provided, that if the violation is committed SO ORDERED.
by a corporation, partnership, or any juridical
entity, the Manager, managing partner, or any G.R. No. 135962 March 27, 2000
person charged with the management thereof shall
be held responsible therefor. The ordinance itself AUTHORITY, petitioner,
also clearly states that it is the regular courts that vs.
will determine whether there was a violation of the INC., respondent.
As pointed out in Trackworks, the MMDA
Not infrequently, the government is tempted to
does not have the power to enact ordinances. take legal shortcuts solve urgent problems of the
Thus, it cannot supplement the provisions of people. But even when government is armed with
the best of intention, we cannot allow it to run
Quezon City Ordinance No. 2904 merely through roughshod over the rule of law. Again, we let the
its Resolution No. 02-28. hammer fall and fall hard on the illegal attempt of
the MMDA to open for public use a private road in
a private subdivision. While we hold that the
Lastly, the MMDA claims that the City
general welfare should be promoted, we stress that
Government of Quezon City may be considered to it should not be achieved at the expense of the rule
have approved the demolition of the structure, of law.

simply because then Quezon City Mayor Feliciano

Petitioner MMDA is a government agency tasked
R. Belmonte signed MMDA Resolution No. 02-28. with the delivery of basic services in Metro Manila.
In effect, the city government delegated these Respondent Bel-Air Village Association, Inc. (BAVA)
is a non-stock, non-profit corporation whose
powers to the MMDA. The powers referred to are members are homeowners in Bel-Air Village, a
those that include the power to declare, prevent private subdivision in Makati City. Respondent
BAVA is the registered owner of Neptune Street, a
and abate a nuisance[32] and to further impose the
road inside Bel-Air Village.
penalty of removal or demolition of the building or
structure by the owner or by the city at the On December 30, 1995, respondent received from
petitioner, through its Chairman, a notice dated
expense of the owner.[33] December 22, 1995 requesting respondent to open
Neptune Street to public vehicular traffic starting
MMDAs argument does not hold water. January 2, 1996. The notice reads:
There was no valid delegation of powers to the
SUBJECT: NOTICE of the Opening of
MMDA. Contrary to the claim of the MMDA, the Neptune Street to Traffic.
City Government of Quezon City washed its hands
off the acts of the former. In its Answer, [34] the city Dear President Lindo,
government stated that the demolition was
Please be informed that pursuant to the Makati by ordinance. The decision disposed of as
mandate of the MMDA law or Republic Act follows:
No. 7924 which requires the Authority to
rationalize the use of roads and/or WHEREFORE, the Petition is GRANTED;
thoroughfares for the safe and convenient the challenged Order dated January 23,
movement of persons, Neptune Street shall 1995, in Civil Case No. 96-001, is SET
be opened to vehicular traffic effective ASIDE and the Writ of Preliminary
January 2, 1996. Injunction issued on February 13, 1996 is
hereby made permanent.
In view whereof, the undersigned requests
you to voluntarily open the points of entry For want of sustainable substantiation, the
and exit on said street. Motion to Cite Roberto L. del Rosario in
contempt is denied. 5
Thank you for your cooperation and
whatever assistance that may be extended No pronouncement as to costs.
by your association to the MMDA personnel
who will be directing traffic in the area. SO ORDERED. 6

Finally, we are furnishing you with a copy The Motion for Reconsideration of the decision was
of the handwritten instruction of the denied on September 28, 1998. Hence, this
President on the matter. recourse.

Very truly yours, Petitioner MMDA raises the following questions:

On the same day, respondent was apprised MANDATE TO OPEN NEPTUNE STREET TO
that the perimeter wall separating the PUBLIC TRAFFIC PURSUANT TO ITS
subdivision from the adjacent Kalayaan REGULATORY AND POLICE POWERS?
Avenue would be demolished.
On January 2, 1996, respondent instituted against
petitioner before the Regional Trial Court, Branch IS THE PASSAGE OF AN ORDINANCE A
136, Makati City, Civil Case No. 96-001 for CONDITION PRECEDENT BEFORE THE
injunction. Respondent prayed for the issuance of MMDA MAY ORDER THE OPENING OF
a temporary restraining order and preliminary SUBDIVISION ROADS TO PUBLIC
injunction enjoining the opening of Neptune Street TRAFFIC?
and prohibiting the demolition of the perimeter
wall. The trial court issued a temporary restraining
order the following day.


On January 23, 1996, after due hearing, the trial
court denied issuance of a preliminary
injunction. 2 Respondent questioned the denial
before the Court of Appeals in CA-G.R. SP No.
39549. The appellate court conducted an ocular
inspection of Neptune Street 3 and on February 13,
1996, it issued a writ of preliminary injunction IV
enjoining the implementation of the MMDA's
On January 28, 1997, the appellate court rendered MEETINGS HELD BETWEEN MMDA AND
a Decision on the merits of the case finding that THE AFFECTED EEL-AIR RESIDENTS AND
the MMDA has no authority to order the opening of BAVA OFFICERS?
Neptune Street, a private subdivision road and
cause the demolition of its perimeter walls. It held V
that the authority is lodged in the City Council of
HAS RESPONDENT COME TO COURT Government Code of 1991 defines a local
WITH UNCLEAN HANDS?7 government unit as a "body politic and
corporate." 17 — one endowed with powers as a
Neptune Street is owned by respondent BAVA. It is political subdivision of the National Government
a private road inside Bel-Air Village, a private and as a corporate entity representing the
residential subdivision in the heart of the financial inhabitants of its territory. 18 Local government
and commercial district of Makati City. It runs units are the provinces, cities, municipalities and
parallel to Kalayaan Avenue, a national road open barangays. 19 They are also the territorial and
to the general public. Dividing the two (2) streets is political subdivisions of the state. 20
a concrete perimeter wall approximately fifteen (15)
feet high. The western end of Neptune Street Our Congress delegated police power to the local
intersects Nicanor Garcia, formerly Reposo Street, government units in the Local Government Code of
a subdivision road open to public vehicular traffic, 1991. This delegation is found in Section 16 of the
while its eastern end intersects Makati Avenue, a same Code, known as the general welfare
national road. Both ends of Neptune Street are clause, viz:
guarded by iron gates.
Sec. 16. General Welfare. — Every local
Petitioner MMDA claims that it has the authority to government unit shall exercise the powers
open Neptune Street to public traffic because it is expressly granted, those necessarily implied
an agent of the state endowed with police power in therefrom, as well as powers necessary,
the delivery of basic services in Metro Manila. One appropriate, or incidental for its efficient
of these basic services is traffic management which and effective governance, and those which
involves the regulation of the use of thoroughfares are essential to the promotion of the general
to insure the safety, convenience and welfare of the welfare. Within their respective territorial
general public. It is alleged that the police power of jurisdictions, local government units shall
MMDA was affirmed by this Court in the ensure and support, among other things,
consolidated cases of Sangalang v. Intermediate the preservation and enrichment of culture,
Appellate Court. 8 From the premise that it has promote health and safety, enhance the
police power, it is now urged that there is no need right of the people to a balanced ecology,
for the City of Makati to enact an ordinance encourage and support the development of
opening Neptune street to the public. 9 appropriate and self-reliant scientific and
technological capabilities, improve public
Police power is an inherent attribute of sovereignty. morals, enhance economic prosperity and
It has been defined as the power vested by the social justice, promote full employment
Constitution in the legislature to make, ordain, among their residents, maintain peace and
and establish all manner of wholesome and order, and preserve the comfort and
reasonable laws, statutes and ordinances, either convenience of their inhabitants. 21
with penalties or without, not repugnant to the
Constitution, as they shall judge to be for the good Local government units exercise police power
and welfare of the commonwealth, and for the through their respective legislative bodies. The
subjects of the same. 10 The power is plenary and legislative body of the provincial government is
its scope is vast and pervasive, reaching and the sangguniang panlalawigan, that of the city
justifying measures for public health, public safety, government is the sangguniang panlungsod, that of
public morals, and the general welfare. 11 the municipal government is the sangguniang
bayan, and that of the barangay is
It bears stressing that police power is lodged the sangguniang barangay. The Local Government
primarily in the National Legislature. 12 It cannot be Code of 1991 empowers the sangguniang
exercised by any group or body of individuals not panlalawigan, sangguniang panlungsod and
possessing legislative power. 13 The National sangguniang bayan to "enact ordinances, approve
Legislature, however, may delegate this power to resolutions and appropriate funds for the general
the President and administrative boards as well as welfare of the [province, city or municipality, as the
the lawmaking bodies of municipal corporations or case may be], and its inhabitants pursuant to
local government units. 14 Once delegated, the Section 16 of the Code and in the proper exercise
agents can exercise only such legislative powers as of the corporate powers of the [province, city
are conferred on them by the national lawmaking municipality] provided under the Code . . . " 22 The
body. 15 same Code gives the sangguniang barangay the
power to "enact ordinances as may be necessary to
A local government is a "political subdivision of a discharge the responsibilities conferred upon it by
nation or state which is constituted by law and has law or ordinance and to promote the general
substantial control of local affairs." 16 The Local welfare of the inhabitants thereon." 23
Metropolitan or Metro Manila is a body composed of development within Metropolitan Manila,
several local government units — i.e., twelve (12) consistent with national development
cities and five (5) municipalities, namely, the cities objectives and priorities;
of Caloocan, Manila, Mandaluyong, Makati, Pasay,
Pasig, Quezon, Muntinlupa, Las Pinas, Marikina, (b) Prepare, coordinate and regulate the
Paranaque and Valenzuela, and the municipalities implementation of medium-term investment
of Malabon, Navotas, Pateros, San Juan and programs for metro-wide services which
Taguig. With the passage of Republic Act (R. A.) shall indicate sources and uses of funds for
No. 7924 24 in 1995, Metropolitan Manila was priority programs and projects, and which
declared as a "special development and shall include the packaging of projects and
administrative region" and the Administration presentation to funding institutions;
of "metro-wide" basic services affecting the region
placed under "a development authority" referred to (c) Undertake and manage on its own
as the MMDA. 25 metro-wide programs and projects for the
delivery of specific services under its
"Metro-wide services" are those "services which jurisdiction, subject to the approval of the
have metro-wide impact and transcend local Council. For this purpose, MMDA can
political boundaries or entail huge expenditures create appropriate project management
such that it would not be viable for said services to offices;
be provided by the individual local government
units comprising Metro Manila." 26 There are seven (d) Coordinate and monitor the
(7) basic metro-wide services and the scope of implementation of such plans, programs
these services cover the following: (1) development and projects in Metro Manila; identify
planning; (2) transport and traffic management; (3) bottlenecks and adopt solutions to
solid waste disposal and management; (4) flood problems of implementation;
control and sewerage management; (5) urban
renewal, zoning and land use planning, and shelter
(e) The MMDA shall set the policies
services; (6) health and sanitation, urban
concerning traffic in Metro Manila, and shall
protection and pollution control; and (7) public
coordinate and regulate the implementation
safety. The basic service of transport and traffic
of all programs and projects concerning
management includes the following:
traffic management, specifically pertaining
to enforcement, engineering and
(b) Transport and traffic management which education. Upon request, it shall be
include the formulation, coordination, and extended assistance and
monitoring of policies, standards, programs cooperation, including but not limited
and projects to rationalize the existing to, assignment of personnel, by all other
transport operations, infrastructure government agencies and offices concerned;
requirements,the use of thoroughfares, and
promotion of safe and convenient movement
(f) Install and administer a single ticketing
of persons and goods; provision for the mass
system, fix, impose and collect fines and
transport system and the institution of a
penalties for all kinds of violations of traffic
system to regulate road
rules and regulations, whether moving or
users; administration and implementation of
non-moving in nature, and confiscate and
all traffic enforcement operations, traffic
suspend or revoke drivers' licenses in the
engineering services and traffic education
enforcement of such traffic laws and
programs, including the institution of a
regulations, the provisions of RA 4136 and
single ticketing system in Metropolitan
PD 1605 to the contrary
Manila;" 27
notwithstanding. For this purpose, the
Authority shall impose all traffic laws and
In the delivery of the seven (7) basic services, the regulations in Metro Manila, through its
MMDA has the following powers and functions: traffic operation center, and may deputize
members of the PNP, traffic enforcers of local
Sec. 5. Functions and powers of the Metro government units, duly licensed security
Manila Development Authority. — The guards, or members of non-governmental
MMDA shall: organizations to whom may be delegated
certain authority, subject to such conditions
(a) Formulate, coordinate and regulate the and requirements as the Authority may
implementation of medium and long-term impose; and
plans and programs for the delivery of
metro-wide services, land use and physical
(g) Perform other related functions required (d) It shall promulgate rules and regulations
to achieve the objectives of the MMDA, and set policies and standards for metro-
including the undertaking of delivery of wide application governing the delivery of
basic services to the local government basic services, prescribe and collect service
units, when deemed necessary subject to and regulatory fees, and impose and collect
prior coordination with and consent of the fines and penalties.
local government unit concerned.
Clearly, the scope of the MMDA's function is
The implementation of the MMDA's plans, programs limited to the delivery of the seven (7) basic
and projects is undertaken by the local government services. One of these is transport and traffic
units, national government agencies, accredited management which includes the formulation and
people's organizations, non-governmental monitoring of policies, standards and projects to
organizations, and the private sector as well as by rationalize the existing transport operations,
the MMDA itself. For this purpose, the MMDA has infrastructure requirements, the use of
the power to enter into contracts, memoranda of thoroughfares and promotion of the safe movement
agreement and other arrangements with these of persons and goods. It also covers the mass
bodies for the delivery of the required services transport system and the institution of a system of
Metro Manila. 28 road regulation, the administration of all traffic
enforcement operations, traffic engineering services
The governing board of the MMDA is the Metro and traffic education programs, including the
Manila Council. The Council is composed of the institution of a single ticketing system in Metro
mayors of the component 12 cities and 5 Manila for traffic violations. Under the service, the
municipalities, the president of the Metro Manila MMDA is expressly authorized "to set the policies
Vice-Mayors' League and the president of the Metro concerning traffic" and "coordinate and regulate
Manila Councilors' League. 29 The Council is the implementation of all traffic management
headed by Chairman who is appointed by the programs." In addition, the MMDA may "install and
President and vested with the rank of cabinet administer a single ticketing system," fix, impose
member. As the policy-making body of the MMDA, and collect fines and penalties for all traffic
the Metro Manila Council approves metro-wide violations.
plans, programs and projects, and issues the
necessary rules and regulations for the It will be noted that the powers of the MMDA are
implementation of said plans; it approves the limited to the following acts: formulation,
annual budget of the MMDA and promulgate the coordination, regulation, implementation,
rules and regulations for the delivery of basic preparation, management, monitoring, setting of
services, collection of service and regulatory fees, policies, installation of a system and
fines and penalties. These functions are administration. There is no syllable in
particularly enumerated as follows: R.A. No. 7924 that grants the MMDA police
power, let alone legislative power. Even the Metro
Sec. 6. Functions of the Metro Manila Manila Council has not been delegated any
Council. — legislative power. Unlike the legislative bodies of
the local government units, there is no provision in
(a) The Council shall be the policy-making R.A. No. 7924 that empowers the MMDA or its
body of the MMDA; Council to "enact ordinances, approve resolutions
appropriate funds for the general welfare" of the
inhabitants of Metro Manila. The MMDA is, as
(b) It shall approve metro-wide plans, termed in the charter itself, "development
programs and projects and issue rules and authority." 30 It is an agency created for the
regulations deemed necessary by the purpose of laying down policies and coordinating
MMDA to carry out the purposes of this with the various national government agencies,
Act; people's organizations, non-governmental
organizations and the private sector for the
(c) It may increase the rate of allowances efficient and expeditious delivery of basic services
and per diems of the members of the in the vast metropolitan area. All its functions are
Council to be effective during the term of administrative in nature and these are actually
the succeeding Council. It shall fix the summed up in the charter itself, viz:
compensation of the officers and personnel
of the MMDA, and approve the annual Sec. 2. Creation of the Metropolitan Manila
budget thereof for submission to the Development Authority. — . . . .
Department of Budget and Management
The MMDA shall Village and the commercial district, Jupiter Street
perform planning, monitoring and was not for the exclusive benefit of Bel-Air
coordinative functions, and in the process residents. We also held that the perimeter wall on
exercise regulatory and supervisory said street was constructed not to separate the
authority over the delivery of metro-wide residential from the commercial blocks but simply
services within Metro Manila, without for security reasons, hence, in tearing down said
diminution of the autonomy of the local wall, Ayala Corporation did not violate the "deed
government units concerning purely local restrictions" in the deeds of sale.
matters. 31
We upheld the ordinances, specifically MMC
Petitioner cannot seek refuge in the cases Ordinance No. 81-01, as a legitimate exercise of
of Sangalang v. Intermediate Appellate police power. 37 The power of the MMC and the
Court 32 where we upheld a zoning ordinance issued Makati Municipal Council to enact zoning
by the Metro Manila Commission (MMC), the ordinances for the general welfare prevailed over
predecessor of the MMDA, as an exercise of police the "deed restrictions".
power. The first Sangalang decision was on the
merits of the petition, 33 while the second decision In the second Sangalang/Yabut decision, we held
denied reconsideration of the first case and in that the opening of Jupiter Street was warranted
addition discussed the case of Yabut v. Court of by the demands of the common good in terms of
Appeals. 34 "traffic decongestion and public convenience."
Jupiter was opened by the Municipal Mayor to
Sangalang v. IAC involved five (5) consolidated alleviate traffic congestion along the public streets
petitions filed by respondent BAVA and three adjacent to the Village. 38 The same reason was
residents of Bel-Air Village against other residents given for the opening to public vehicular traffic of
of the Village and the Ayala Corporation, formerly Orbit Street, a road inside the same village. The
the Makati Development Corporation, as the destruction of the gate in Orbit Street was also
developer of the subdivision. The petitioners made under the police power of the municipal
sought to enforce certain restrictive easements in government. The gate, like the perimeter wall along
the deeds of sale over their respective lots in the Jupiter, was a public nuisance because it hindered
subdivision. These were the prohibition on the and impaired the use of property, hence, its
setting up of commercial and advertising signs on summary abatement by the mayor was proper and
the lots, and the condition that the lots be used legal. 39
only for residential purposes. Petitioners alleged
that respondents, who were residents along Jupiter Contrary to petitioner's claim, the two Sangalang
Street of the subdivision, converted their cases do not apply to the case at bar. Firstly, both
residences into commercial establishments in involved zoning ordinances passed by the
violation of the "deed restrictions," and that municipal council of Makati and the MMC. In the
respondent Ayala Corporation ushered in the full instant case, the basis for the proposed opening of
commercialization" of Jupiter Street by tearing Neptune Street is contained in the notice of
down the perimeter wall that separated the December 22, 1995 sent by petitioner to
commercial from the residential section of the respondent BAVA, through its president. The
village. 35 notice does not cite any ordinance or law, either by
the Sangguniang Panlungsod of Makati City or by
The petitions were dismissed based on Ordinance the MMDA, as the legal basis for the proposed
No. 81 of the Municipal Council of Makati and opening of Neptune Street. Petitioner MMDA
Ordinance No. 81-01 of the Metro Manila simply relied on its authority under its charter "to
Commission (MMC). Municipal Ordinance No. 81 rationalize the use of roads and/or thoroughfares
classified Bel-Air Village as a Class A Residential for the safe and convenient movement of persons."
Zone, with its boundary in the south extending to Rationalizing the use of roads and thoroughfares is
the center line of Jupiter Street. The Municipal one of the acts that fall within the scope of
Ordinance was adopted by the MMC under the transport and traffic management. By no stretch of
Comprehensive Zoning Ordinance for the National the imagination, however, can this be interpreted
Capital Region and promulgated as MMC as an express or implied grant of ordinance-
Ordinance No. 81-01. Bel-Air Village was indicated making power, much less police power.
therein as bounded by Jupiter Street and the block
adjacent thereto was classified as a High Intensity Secondly, the MMDA is not the same entity as the
Commercial Zone. 36 MMC in Sangalang. Although the MMC is the
forerunner of the present MMDA, an examination
We ruled that since both Ordinances recognized of Presidential Decree (P. D.) No. 824, the charter
Jupiter Street as the boundary between Bel-Air of the MMC, shows that the latter possessed
greater powers which were not bestowed on the tax measures should, however, continue to
present MMDA. be operative until otherwise modified or
repealed by the Commission;
Metropolitan Manila was first created in 1975 by
Presidential Decree (P.D.) No. 824. It comprised the 3. To charge and collect fees for the use of
Greater Manila Area composed of the contiguous public service facilities;
four (4) cities of Manila, Quezon, Pasay and
Caloocan, and the thirteen (13) municipalities of 4. To appropriate money for the operation
Makati, Mandaluyong, San Juan, Las Pinas, of the metropolitan government and review
Malabon, Navotas, Pasig, Pateros, Paranaque, appropriations for the city and municipal
Marikina, Muntinlupa and Taguig in the province units within its jurisdiction with authority
of Rizal, and Valenzuela in the province of to disapprove the same if found to be not in
Bulacan. 40 Metropolitan Manila was created as a accordance with the established policies of
response to the finding that the rapid growth of the Commission, without prejudice to any
population and the increase of social and economic contractual obligation of the local
requirements in these areas demand a call for government units involved existing at the
simultaneous and unified development; that the time of approval of this Decree;
public services rendered by the respective local
governments could be administered more 5. To review, amend, revise or repeal all
efficiently and economically if integrated under a ordinances, resolutions and acts of cities
system of central planning; and this coordination, and municipalities within Metropolitan
"especially in the maintenance of peace and order Manila;
and the eradication of social and economic ills that
fanned the flames of rebellion and discontent
6. To enact or approve ordinances,
[were] part of reform measures under Martial Law
resolutions and to fix penalties for any
essential to the safety and security of the State." 41
violation thereof which shall not exceed a
fine of P10,000.00 or imprisonment of six
Metropolitan Manila was established as a "public years or both such fine and imprisonment
corporation" with the following powers: for a single offense;

Sec. 1. Creation of the Metropolitan Manila. 7. To perform general administrative,

— There is hereby created a public executive and policy-making functions;
corporation, to be known as the
Metropolitan Manila, vested with powers
8. To establish a fire control operation
and attributes of a corporation including the
center, which shall direct the fire services of
power to make contracts, sue and be
the city and municipal governments in the
sued, acquire, purchase, expropriate, hold, t
metropolitan area;
ransfer and dispose of property and such
other powers as are necessary to carry out
its purposes. The Corporation shall be 9. To establish a garbage disposal operation
administered by a Commission created center, which shall direct garbage collection
under this Decree. 42 and disposal in the metropolitan area;

The administration of Metropolitan Manila was 10. To establish and operate a transport
placed under the Metro Manila Commission (MMC) and traffic center, which shall direct traffic
vested with the following powers: activities;

Sec. 4. Powers and Functions of the Commission. — 11. To coordinate and monitor
The Commission shall have the following powers governmental and private activities
and functions: pertaining to essential services such as
transportation, flood control and drainage,
water supply and sewerage, social, health
1. To act as a central government to
and environmental services, housing, park
establish and administer programs and
development, and others;
provide services common to the area;

12. To insure and monitor the undertaking

2. To levy and collect taxes and special
of a comprehensive social, economic and
assessments, borrow and expend money
physical planning and development of the
and issue bonds, revenue certificates, and
other obligations of indebtedness. Existing
13. To study the feasibility of increasing The Sangguniang Bayan may recommend
barangay participation in the affairs of their to the Commission ordinances, resolutions
respective local governments and to or such measures as it may adopt;
propose to the President of the Philippines Provided, that no such ordinance,
definite programs and policies for resolution or measure shall become
implementation; effective, until after its approval by the
Commission; and Provided further, that the
14. To submit within thirty (30) days after power to impose taxes and other levies, the
the close of each fiscal year an annual power to appropriate money and the power
report to the President of the Philippines to pass ordinances or resolutions with
and to submit a periodic report whenever penal sanctions shall be vested exclusively
deemed necessary; and in the Commission.

15. To perform such other tasks as may be The creation of the MMC also carried with it the
assigned or directed by the President of the creation of the Sangguniang Bayan. This was
Philippines. composed of the members of the component city
and municipal councils, barangay captains chosen
The MMC was the "central government" of Metro by the MMC and sectoral representatives appointed
Manila for the purpose of establishing and by the President. The Sangguniang Bayan had the
administering programs providing services power to recommend to the MMC the adoption of
common to the area. As a "central government" it ordinances, resolutions or measures. It was the
had the power to levy and collect taxes and special MMC itself, however, that possessed legislative
assessments, the power to charge and collect fees; powers. All ordinances, resolutions and measures
the power to appropriate money for its operation, recommended by the Sangguniang Bayan were
and at the same time, review appropriations for the subject to the MMC's approval. Moreover, the
city and municipal units within its jurisdiction. It power to impose taxes and other levies, the power
was bestowed the power to enact or approve to appropriate money, and the power to pass
ordinances, resolutions and fix penalties for ordinances or resolutions with penal sanctions
violation of such ordinances and resolutions. It were vested exclusively in the MMC.
also had the power to review, amend, revise or
repeal all ordinances, resolutions and acts of any Thus, Metropolitan Manila had a "central
of the four (4) cities and thirteen (13) government," i.e., the MMC which fully possessed
municipalities comprising Metro Manila. legislative police powers. Whatever legislative
powers the component cities and municipalities
P.D. No. 824 further provided: had were all subject to review and approval by the
Sec. 9. Until otherwise provided, the
governments of the four cities and thirteen After President Corazon Aquino assumed power,
municipalities in the Metropolitan Manila there was a clamor to restore the autonomy of the
shall continue to exist in their present form local government units in Metro Manila. Hence,
except as may be inconsistent with this Sections 1 and 2 of Article X of the 1987
Decree. The members of the existing city Constitution provided:
and municipal councils in Metropolitan
Manila shall, upon promulgation of this Sec. 1. The territorial and political
Decree, and until December 31, 1975, subdivisions of the Republic of the
become members of the Sangguniang Bayan Philippines are the provinces, cities,
which is hereby created for every city and municipalities and barangays. There shall
municipality of Metropolitan Manila. be autonomous regions in Muslim
Mindanao and the Cordilleras as herein
In addition, the Sangguniang Bayan shall provided.
be composed of as many barangay captains
as may be determined and chosen by the Sec. 2. The territorial and political
Commission, and such number of subdivisions shall enjoy local autonomy.
representatives from other sectors of the
society as may be appointed by the The Constitution, however, recognized the
President upon recommendation of the necessity of creating metropolitan regions not only
Commission. in the existing National Capital Region but also in
potential equivalents in the Visayas and
xxx xxx xxx Mindanao. 43 Section 11 of the same Article X thus
Sec. 11. The Congress may, by law, create provide the local government units technical
special metropolitan political subdivisions, assistance in the preparation of local development
subject to a plebiscite as set forth in plans. Any semblance of legislative power it had
Section 10 hereof. The component cities was confined to a "review [of] legislation proposed
and municipalities shall retain their basic by the local legislative assemblies to ensure
autonomy and shall be entitled to their own consistency among local governments and with the
local executives and legislative assemblies. comprehensive development plan of Metro Manila,"
The jurisdiction of the metropolitan and to "advise the local governments
authority that will thereby be created shall accordingly." 49
be limited to basic services requiring
coordination. When R.A. No. 7924 took effect, Metropolitan
Manila became a "special development and
Constitution itself expressly provides that Congress administrative region" and the MMDA a "special
may, by law, create "special metropolitan political development authority" whose functions were
subdivisions" which shall be subject to approval by "without prejudice to the autonomy of the affected
a majority of the votes cast in a plebiscite in the local government units." The character of the
political units directly affected; the jurisdiction of MMDA was clearly defined in the legislative
this subdivision shall be limited to basic services debates enacting its charter.
requiring coordination; and the cities and
municipalities comprising this subdivision shall R.A. No. 7924 originated as House Bill No.
retain their basic services requiring coordination; 14170/11116 and was introduced by several
and the cities and municipalities comprising this legislators led by Dante Tinga, Roilo Golez and
subdivision shall retain their basic autonomy and Feliciano Belmonte. It was presented to the House
their own local executive and legislative of Representatives by the Committee on Local
assemblies. 44 Pending enactment of this law, the Governments chaired by Congressman Ciriaco R.
Transitory Provisions of the Constitution gave the Alfelor. The bill was a product of Committee
President of the Philippines the power to constitute consultations with the local government units in
the Metropolitan Authority, viz: the National Capital Region (NCR), with former
Chairmen of the MMC and MMA, 50 and career
Sec. 8. Until otherwise provided by officials of said agencies. When the bill was first
Congress, the President may constitute the taken up by the Committee on Local Governments,
Metropolitan Authority to be composed of the following debate took place:
the heads of all local government units
comprising the Metropolitan Manila area. 45 THE CHAIRMAN [Hon. Ciriaco Alfelor]:
Okay, Let me explain. This has been
In 1990, President Aquino issued Executive Order debated a long time ago, you know. It's a
(E. O.) No. 392 and constituted the Metropolitan special . . . we can create a special
Manila Authority (MMA). The powers and functions metropolitan political subdivision.
of the MMC were devolved to the MMA. 46 It ought
to be stressed, however, that not all powers and Actually, there are only six (6) political
functions of the MMC were passed to the MMA. subdivisions provided for in the
The MMA's power was limited to the "delivery of Constitution: barangay, municipality, city,
basic urban services requiring coordination in province, and we have the Autonomous
Metropolitan Manila." 47 The MMA's governing Region of Mindanao and we have the
body, the Metropolitan Manila Council, although Cordillera. So we have 6. Now. . . . .
composed of the mayors of the component cities
and municipalities, was merely given power of: (1) HON. [Elias] LOPEZ: May I interrupt, Mr.
formulation of policies on the delivery of basic Chairman. In the case of the Autonomous
services requiring coordination and consolidation; Region, that is also specifically mandated
and (2) promulgation resolutions and other by the Constitution.
issuances, approval of a code of basic services and
the exercise of its rule-making power. 48
THE CHAIRMAN: That's correct. But it is
considered to be a political subdivision.
Under the 1987 Constitution, the local government What is the meaning of a political
units became primarily responsible for the subdivision? Meaning to say, that it has its
governance of their respective political own government, it has its own political
subdivisions. The MMA's jurisdiction was limited to personality, it has the power to tax, and all
addressing common problems involving basic governmental powers: police power and
services that transcended local boundaries. It did everything. All right. Authority is different;
not have legislative power. Its power was merely to because it does not have its own
government. It is only a council, it is an the implementation of the MMDA's functions.
organization of political subdivision, There is no grant of authority to enact ordinances
powers, "no, which is not imbued with any and regulations for the general welfare of the
political power. inhabitants of the metropolis. This was explicitly
stated in the last Committee deliberations prior to
If you go over Section 6, where the powers the bill's presentation to Congress. Thus:
and functions of the Metro Manila
Development Authority, it is purely THE CHAIRMAN: Yeah, but we have to go
coordinative. And it provides here that the over the suggested revision. I think this was
council is policy-making. All right. already approved before, but it was
reconsidered in view of the proposals, set-
Under the Constitution is a Metropolitan up, to make the MMDA stronger. Okay, so if
Authority with coordinative power. Meaning there is no objection to paragraph "f". . .
to say, it coordinates all of the different And then next is paragraph "b," under
basic services which have to be delivered to Section 6. "It shall approve metro-wide
the constituency. All right. plans, programs and projects and issue
ordinances or resolutions deemed necessary
There is now a problem. Each local by the MMDA to carry out the purposes of
government unit is given its respective . . . this Act." Do you have the powers? Does the
as a political subdivision. Kalookan has its MMDA... because that takes the form of a
powers, as provided for and protected and local government unit, a political subdivision.
guaranteed by the Constitution. All right,
the exercise. However, in the exercise of HON. [Feliciano] BELMONTE: Yes, I believe
that power, it might be deleterious and so, your Honor. When we say that it has the
disadvantageous to other local government policies, it's very clear that those policies
units. So, we are forming an authority must be followed. Otherwise, what's the use
where all of these will be members and then of empowering it to come out with policies.
set up a policy in order that the basic Now, the policies may be in the form of a
services can be effectively coordinated. All resolution or it may be in the form of a
right. ordinance. The term "ordinance" in this
case really gives it more teeth, your honor.
Of course, we cannot deny that the MMDA Otherwise, we are going to see a situation
has to survive. We have to provide some where you have the power to adopt the
funds, resources. But it does not possess policy but you cannot really make it stick
any political power. We do not elect the as in the case now, and I think here is
Governor. We do not have the power to tax. Chairman Bunye. I think he will agree that
As a matter of fact, I was trying to intimate that is the case now. You've got the power
to the author that it must have the power to to set a policy, the body wants to follow
sue and be sued because it coordinates. All your policy, then we say let's call it an
right. It coordinates practically all these ordinance and see if they will not follow it.
basic services so that the flow and the
distribution of the basic services will be THE CHAIRMAN: That's very nice. I like
continuous. Like traffic, we cannot deny that. However, there is a constitutional
that. It's before our eyes. Sewerage, flood impediment.1âwphi1 You are making this
control, water system, peace and order, we MMDA a political subdivision. The creation
cannot deny these. It's right on our face. We of the MMDA would be subject to a
have to look for a solution. What would be plebiscite. That is what I'm trying to avoid.
the right solution? All right, we envision I've been trying to avoid this kind of
that there should be a coordinating agency predicament. Under the Constitution it
and it is called an authority. All right, if you states: if it is a political subdivision, once it
do not want to call it an authority, it's is created it has to be subject to a
alright. We may call it a council or maybe a plebiscite. I'm trying to make this as
management agency. administrative. That's why we place the
Chairman as a cabinet rank.
xxx xxx xxx
HON. BELMONTE: All right, Mr. Chairman,
Clearly, the MMDA is not a political unit of okay, what you are saying there is . . . . .
government. The power delegated to the MMDA is
that given to the Metro Manila Council to THE CHAIRMAN: In setting up ordinances,
promulgate administrative rules and regulations in it is a political exercise, Believe me.
HON. [Elias] LOPEZ: Mr. Chairman, it can rank and privileges of a cabinet member. In fact,
be changed into issuances of rules and part of his function is to perform such other duties
regulations. That would be . . . it shall also as may be assigned to him by the
be enforced. President, 57 whereas in local government units, the
President merely exercises supervisory authority.
HON. BELMONTE: Okay, I will . . . . This emphasizes the administrative character of
the MMDA.
HON. LOPEZ: And you can also say that
violation of such rule, you impose a Clearly then, the MMC under P.D. No. 824 is not
sanction. But you know, ordinance has a the same entity as the MMDA under R.A. No. 7924.
different legal connotation. Unlike the MMC, the MMDA has no power to enact
ordinances for the welfare of the community. It is
HON. BELMONTE: All right, I defer to that the local government units, acting through their
opinion, your Honor. respective legislative councils, that possess
legislative power and police power. In the case at
bar, the Sangguniang Panlungsod of Makati City
THE CHAIRMAN: So instead of ordinances, did not pass any ordinance or resolution ordering
say rules and regulations. the opening of Neptune Street, hence, its proposed
opening by petitioner MMDA is illegal and the
HON. BELMONTE: Or resolutions. Actually, respondent Court of Appeals did not err in so
they are actually considering resolutions ruling. We desist from ruling on the other issues as
now. they are unnecessary.

THE CHAIRMAN: Rules and resolutions. We stress that this decision does not make light of
the MMDA's noble efforts to solve the chaotic traffic
HON. BELMONTE: Rules, regulations and condition in Metro Manila. Everyday, traffic jams
resolutions. 52 and traffic bottlenecks plague the metropolis. Even
our once sprawling boulevards and avenues are
The draft of H. B. No. 14170/11116 was presented now crammed with cars while city streets are
by the Committee to the House of Representatives. clogged with motorists and pedestrians. Traffic has
The explanatory note to the bill stated that the become a social malaise affecting our people's
proposed MMDA is a "development authority" productivity and the efficient delivery of goods and
which is a "national agency, not a political services in the country. The MMDA was created to
government unit." 53 The explanatory note was put some order in the metropolitan transportation
adopted as the sponsorship speech of the system but unfortunately the powers granted by its
Committee on Local Governments. No charter are limited. Its good intentions cannot
interpellations or debates were made on the floor justify the opening for public use of a private street
and no amendments introduced. The bill was in a private subdivision without any legal warrant.
approved on second reading on the same day it The promotion of the general welfare is not
was presented. 54 antithetical to the preservation of the rule of
When the bill was forwarded to the Senate, several
amendments were made.1âwphi1 These IN VIEW WHEREOF, the petition is denied. The
amendments, however, did not affect the nature of Decision and Resolution of the Court of Appeals in
the MMDA as originally conceived in the House of CA-G.R. SP No. 39549 are affirmed.
Representatives. 55
It is thus beyond doubt that the MMDA is not a
local government unit or a public corporation G.R. No. 213948
endowed with legislative power. It is not even a
"special metropolitan political subdivision" as KNIGHTS OF RIZAL, Petitioner.
contemplated in Section 11, Article X of the vs.
Constitution. The creation of a "special DMCI HOMES, INC., DMCI PROJECT
metropolitan political subdivision" requires the DEVELOPERS, INC., CITY OF MANILA,
approval by a majority of the votes cast in a NATIONAL COMMISSION FOR CULTURE AND
plebiscite in the political units directly THE ARTS, NATIONAL HISTORICAL
affected." 56 R. A. No. 7924 was not submitted to COMMISSION OF THE
the inhabitants of Metro Manila in a plebiscite. The PHILIPPINES, Respondents.
Chairman of the MMDA is not an official elected by
the people, but appointed by the President with the
DECISION line of sight of the Rizal Shrine from the frontal
Roxas Boulevard vantage point[.]"7
Building Official Melvin Q. Balagot then sought the
Bury me in the ground, place a stone and a cross opinion of the City of Manila's City Legal Officer on
over it. whether he is bound to comply with Resolution No.
My name, the date of my birth, and of my death. 121.8 In his letter dated 12 September 2012, City
Nothing more. Legal Officer Renato G. Dela Cruz stated that there
If you later wish to surround my grave with a fence, is "no legal justification for the temporary
you may do so. suspension of the Building Permit issued in favor
No anniversaries. I prefer Paang Bundok.- Jose of [DMCI-PDI]" since the construction "lies outside
Rizal the Luneta Park" and is "simply too far to I be a
repulsive distraction or have an objectionable effect
The Case on the artistic and historical significance" of the
Rizal Monument. 9 He also pointed out that "there
is no showing that the [area of subject property
Before this Court is a Petition for Injunction, with has been officially declared as an anthropological
Applications for Temporary Restraining Order, Writ or archeological area. Neither has it ' been
of Preliminary Injunction, and Others 1 filed by the categorically designated by the National Historical
Knights of Rizal (KOR) seeking, among others, for Institute as a heritage zone, a cultural property, a
an order to stop the construction of respondent historical landmark or even a national treasure."
DMCI Homes, Inc. 's condominium development
project known as the Torre de Manila. In its
Resolution dated 25 November 2014, the Court Subsequently, both the City of Manila and DMCI-
resolved to treat the petition as one for PDI sought the opinion or the National Historical
mandamus. 2 Commission of the Philippines (NHCP) on the
matter. In the letter10 dated 6 November 2012 from
NHCP I Chairperson Dr. Maria Serena I. Diokno
The Facts addressed to DMCI-PDI and the letter 11 dated 7
November 2012 from NHCP Executive Director III
Ludovico D. Bado)f addressed to then Manila
Mayor Alfredo S. Lim, the NHCP maintained that
On 1 September 2011, DMCI Project Developers, the Torre de Manila project site is outside the
Inc. (DMCI-PDI) 3 acquired a 7,716.60-square boundaries of the Rizal f.ark and well to the rear of
meter lot in the City of Manila, located near Taft the Rizal Monument, and thus, cannot possibly
Avenue, Ermita, beside the former Manila Jai-Alai obstruct the frontal view of the National
Building and Adamson University.4The lot was Monument.
earmarked for the construction of DMCI-PDI's
Torre de Manila condominium project. On 26 November 2013, following an online petition
against the Torre de Manila project that garnered
On 2 April 2012, DMCI-PDI secured its Barangay about 7,800 signatures, the City Council of Manila
Clearance to start the construction of its project. It issued Resolution No. 146, reiterating its directive
then obtained a Zoning Permit from the City of in Resolution No. 121 1 enjoining the City of
Manila's City Planning and Development Office Manila's building officials to temporarily suspend
(CPDO) on 19 June 2012.5 ~MCI-PDI's Building Permit. 12

Then, on 5 July 2012, the City of Manila's Office of In a letter to Mayor Joseph Ejercito Estrada dated
the Building Official granted DMCI-PDI a Building 18 December 2013, DMCI-PIDI President Alfredo R.
Permit, allowing it to build a "Forty Nine (49) Austria sought clarification on the controversy
Storey w/ Basement & 2 penthouse Level surrounding its Zoning Permit. He stated that
Res'l./Condominium" on the property. 6 since the CPDO granted its Zoning Permit, DMCI-
PDI continued with the application for the Building
On 24 July 2012, the City Council of Manila issued Permit, which was granted, and did not deem it
Resolution No. 121 enjoining the Office of the necessary to go through the process of appealing to
Building Official to temporarily suspend the the local zoning board. He then expressed DMCI-
Building Permit of DMCI-PDI, citing among others, PDI's willingness to comply with the process if the
that "the Torre de Manila Condominium, based on City of Manila deemed it necessary. 13
their development plans, upon completion, will rise
up high above the back of the national monument, On 23 December 2013, the Manila Zoning Board of
to clearly dwarf the statue of our hero, and with Adjustments and Appeals (MZBAA) issued Zoning
such towering heights, would certainly ruin the Board Resolution No. 06, Series of
2013, 14 recommending the approval of DMCI-PDI's Next, the KOR contends that the project is a
application for variance. ;The MZBAA noted that nuisance per se23 because "[t]he despoliation of the
the Torre de Manila project "exceeds the prescribed sight view of the Rizal Monument is a situation
maximum Percentage of Land Occupancy (PLO) that annoy's or offends the senses' of every Filipino
and exceeds the prescribeµ Floor Area Ratio (FAR) who honors the memory of the National Hero Jose
as stipulated in Article V, Section 17 of City Rizal. It is a present, continuing, worsening and
Ordinance No. 8119[.]" However, the MZBAA still aggravating status or condition. Hence, the
recommended the approval of the variance subject PROJECT is a nuisance per se. It deserves I to be
to the five conditions set under the same abated summarily, even without need of judicial
resolution. proceeding. "24

After some clarification sought by DMCI-PDI, the The KOR also claims that the Torre de Manila
MZBAA issued Zoning Board Resolution No. 06-A, project violates the NHCP's Guidelines on
Series of 2013, 15 on 8 January 2014, amending Monuments Honoring National Heroes, Illustrious
condition (c) in the earlier resolution. 16 Filipinos and Other Personages, which state that
historic monuments should assert a visual
On 16 January 2014, the City Council of Manila "dominance" over its surroundings,25 as well as the
issued Resolution No. 5, Series of 2014, 17 adopting country's commitment under the International
Zoning Board Resolution Nos. 06 and 06- A. The Charter for the Conservation and Restoration of
City Council resolution states that "the City Monuments and Sites, otherwise known as the
Council of Manila find[ s] no cogent reason to deny Venice Charter. 26
and/or reverse the aforesaid recommendation of
the [MZBAA] and hereby ratif[ies] and confirm[s] all Lastly, the KOR claims that the DMCI-PDI's
previously issued permits, licenses and approvals construction was commenced and continues in
issued by the City [Council] of Manila for Torre de bad faith, and is in violation of the City of Manila's
Manila[.]" zoning ordinance. 27

Arguments of the KOR Arguments of DMCI-PDI

On 12 September 2014, the KOR, a "civic, In its Comment, DMCI-PDI argues that the KOR's
patriotic, cultural, nonpartisan, non-sectarian and petition should be dismissed on the following
non-profit organization" 18 created under Republic grounds:
Act No. 646, 19 filed a Petition for Injunction
seeking a temporary restraining I order, and later a I.
permanent injunction, against the construction of
DMCIPDI's Torre de Manila condominium project. THXS HONORABLE COURT HAS NO
The KOR argues that the subject matter of the JURISDICTION OVER THIS ACTION.
present suit is one of "transcendental importance,
paramount public interest, of overarching
significance to society, or with far-reaching
implication" involving the desecration of the Rizal
The KOR asserts that the completed Torre de
Manila structure will "[stick] out like a sore thumb, III.
[dwarf] all surrounding buildings within a radius of
two kilometer/s" and "forever ruin the sightline of TORRE DE MANILA IS NOT A NUISANCE PER SE.
the Rizal Monument in Luneta Park: Torre de
Manila building would loom at the back I and IV.
overshadow the entire monument, whether up
close or viewed from a distance. ''20 DMCI-PDI ACTED IN GOOD FAITH IN
Further, the KOR argues that the Rizal Monument,
as a National Treasure, is entitled to "full V.
protection of the law"21and the national
government must abate the act or activity that
endangers the nation's cultural heritage "even
against the wishes of the local government hosting
it." 22
First, DMCI-PDI asserts that the Court has no to it since it was within the "lawful exercise of [its]
original jurisdiction over actions for rights." 39 The KOR failed to present any proof that
injunction.29 Even assuming that the Court has DMCI-PDI did not follow the proper procedure and
concurrent jurisdiction, DMCI-PDI maintains that zoning restrictions of the City of Manila. Aside from
the petition should still have been filed with the obtaining all the necessary permits from the
Regional Trial Court under the doctrine of appropriate government agencies,40 DMCI-PDI also
hierarchy of courts and because the petition sought clarification on its right to build on its site
involves questions of fact. 30 from the Office of the City Legal Officer of Manila,
the Manila CPDO, and the NHCP. 41 Moreover, even
DMCI-PDI also contends that the KOR's petition is if the KOR proffered such proof, the Court would
in actuality an opposition' or appeal from the be 1 in no position to declare DMCI-PDI's acts as
exemption granted by the City of Manila's MZBAA, illegal since the Court is not a trier of facts. 42
a matter which is also not within the jurisdiction of
the Court. 31 DMCI-PDI claims that the proper Finally, DMCI-PDI opposes the KOR's application
forum should be the MZBAA, and should the KOR for a Temporary Restraining Order (TRO) and writ
fail there, it should appeal the same to the Housing of preliminary injunction. DMCI-PDI asserts that
and Land Use Regulatory Board (HLURB). 32 the KOR has failed to establish "a clear and
unmistakable right to enjoin I the construction of
DMCI-PDI further argues that since the Rizal Torre de Manila, much less request its
Monument has been declared a National Treasure, demolitior."43 DMCI-PDI further argues that it "has
the power to issue a cease and desist order is complied with all the legal requirements for the
lodged with the "appropriate cultural agency" construction of Torre de Manila x x x [and] has
under Section 25 of Republic Act No. li0066 or violated o right of KOR that must be protected.
the National Cultural Heritage Act of Further, KOR stands to suffer o damage because of
2009. 33 Moreover, DMCI-PDI asserts that the KOR its lack of direct pecuniary interest in this petiti1
availed of the wrong remedy since an action for on. To grant the KOR's application for injunctive
injunction is not the proper remedy for abatement relief would constitute an unjust taking of property
of a nuisance. 34 without due process of law. "44

Second, DMCI-PDI maintains that the KOR has no Arguments of the City of Manila
standing to institute this proceeding because it is
not a real party in interest in this case. The In its Comment, the City of Manila argues that the
purposes of the KOR as a public corporation do not writ of mandamus cannot issue "considering that
include the preservation of the Rizal Monument as no property or substantive rights whatsoever in
a cultural or historical heritage site. 35 The KOR has favor of [the KOR] is being affected or x x x entitled
also not shown that it suffered an actual or to judicial protection[.]"45
threatened injury as a result of the alleged illegal
conduct of the City of Manila. If there is any injury The City of Manila also asserts that the "issuance
to the KOR at all, the same was caused by the and revocation of a Building Permit undoubtedly
private conduct of a private entity and not the City fall under the category of a discretionary act or
of Manila. 36 duty performed by the proper officer in light of his
meticulous appraisal and evaluation of the
Third, DMCI-PDI argues that the Torre de Manila is pertinent supporting documents of the application
not a nuisance per se. DMCI-PDI reiterates that it in accordance with the rules laid out under the
obtained all the necessary permits, licenses, National Building Code [and] Presidential Decree
clearances, and certificates for its No. 1096,"46 while the remedy of mandamus is
construction. 37 It also refutes the KOR's claim that available only to compel the performance of a
the Torre de Manila would dwarf all other ministerial duty. 47
structures around it; considering that there are
other tall buildings even closer to the Rizal Further, the City of Manila maintains that the
Monument itself, namely, the Eton Baypark Tower construction of the Torre de Manila did not violate
at the corner of Roxas Boulevard and T.M. Kalaw any existing law, since the "edifice [is] well behind
Street (29 storeys; 235 meters from the Rizal (some 789 meters away) the line of sight of the
Monument) and Sunview Palace at the corner of Rizal Monument."48 It adds that the City of
M.H. Del Pilar and T.M. Kalaw Streets (42 storeys; Manila's "prevailing Land Use and Zoning
250 meters from the Rizal Monument). 38 Ordinance [Ordinance No. 8119] x xx allows an
adjustment in Floor Area Ratios thru the [MZBAA]
Fourth, DMCI-PDI next argues that it did not act in subject to further final approval of the City
bad faith when it started construction of its Torre Council."49 The City Council adopted the MZBAA's
de Manila project. Bad faith cannot be attributed favorable: recommendation in its Resolution No. 5,
ratifying all the licenses and permits issued to customs, public order, or public policy are allowed
DMCI-PDI for its Torre de Manila project. if also not contrary to law.

In its Position Paper dated 15 July 2015, the City In this case, there is no allegation or proof that the
of Manila admitted that the Zoning Permit issued Torre de Manila project is "contrary to morals,
to DMCI-PDI was "in breach of certain provisions of customs, and public order" or that it brings harm,
City Ordinance No. 8119."50 It maintained, danger, or hazard to the community. On the
however, 1 that the deficiency is "procedural in contrary, the City of Manila has determined that
nature and pertains mostly td the failure of [DMCI- DMCI-PDI complied with the standards set under
PDI] to comply with the stipulations that allow an the pertinent laws and local ordinances to
excess in the [FAR] provisions." 51 Further, the City construct its Torre de Manila project.
of Manila argued that the MZBAA, when it
recommended the allowance of the project's There is one fact that is crystal clear in this case.
variance, imposed certain conditions upon the There is no law prohibiting the construction of the
Torre de Manila project in order to mitigate the Torre de Manila due to its effect on
possible adverse effects of an excess FAR. 52 the background "view, vista, sightline, or setting"
of the Rizal Monument.
The Issue
Specifically, Section 47 reads:
The issues raised by the parties can be summed
up into one main point: Can the Court issue a writ SEC. 47. Historical Preservation and Conservation
of mandamus against the officials of the City of Standards. - Historic site and facilities shall be
Manila to stop the construction of DMCI-PDI's conserved and preserved. These shall, to the extent
Torre de Manila project? possible, be made accessible for the educational
and cultural enrichment of the general public.
The Court's Ruling
The following shall guide the development of
The petition for mandamus lacks merit and must historic sites and facilities:
be dismissed.
1. Sites with historic buildings or places shall be
There is no law prohibiting the construction of developed to conserve and enhance their heritage
the Torre de Manila. values.

In Manila Electric Company v. Public Service 2. Historic sites and facilities shall be adaptively
Commission,53 the Court held that "what is not re-used.
expressly or impliedly prohibited by law may be
done, except when the act is contrary to 3. Any person who proposes to add, to alter, or
morals, customs and I public order." This partially demolish a designated heritage property
principle is fundamental in a democratic society, to will require the approval of the City Planning and
protect the weak against the strong, the minority Development Office (CPDO) and shall be required
against the majority, and the individual citizen to prepare a heritage impact statement that will
against the government. In essence, this principle, demonstrate to the satisfaction of CPDO that the
which is the foundation of a civilized society under proposal will not adversely impact the heritage
the rule of law, prescribes that the freedom to act significance of the property and shall submit plans
can be curtailed only through law. Without this for review by the CPDO in coordination with the
principle, the rights, freedoms, and civil liberties of National Historical Institute (NHI).
citizens can be arbitrarily and whimsically
trampled upon by the shifting passions of those 4. Any proposed alteration and/or re-use of
who can spout the loudest, or those who can designated heritage properties shall be evaluated
gather the biggest crowd or the most number of based on criteria established by the heritage
Internet trolls. In other instances, 54 the Court has significance of the particular property or site.
allowed or upheld actions that were not expressly
prohibited by statutes when it determined that
5. Where an owner of a heritage property applies
these acts were not contrary to morals, customs,
for approval to demolish a designated heritage
and public order, or that upholding the same
property or properties, the owner shall be required
would lead to a more equitable solution to the
to provide evidence to satisfaction that
controversy. However, it is the law itself - Articles
demonstrates that rehabilitation and re-use of the
130655 and 1409(1)56 of the Civil Code - which
property is not viable.
prescribes that acts not contrary to morals, good
6. Any designated heritage property which is to be as well as efficiently functioning especially in
demolished or significantly altered shall be relation to the adjacent properties and bordering
thoroughly documented for archival purposes with! streets.
a history, photographic records, and measured
drawings, in accordance with accepted heritage The design, construction, operation and
recording guidelines, prior to demolition or maintenance of every facility shall be in harmony
alteration. with the existing and intended character of its
neighborhood. It shall not change the essential
7. Residential and commercial infill in heritage character of the said area but will be a substantial
areas will be sensitive to the existing scale and improvement to the value of the properties in the
pattern of those areas, which maintains the neighborhood in particular and the community in
existing landscape and streetscape qualities of general.
those areas, and which does not result in the loss
of any heritage resources. Furthermore, designs should consider the
8. Development plans shall ensure that parking
facilities (surface lots residential garages, stand- 1. Sites, buildings and facilities shall be designed
alone parking garages and parking components as and developed with1 regard to safety, efficiency
parts of larger developments) are compatibly and high standards of design. The natural
integrated into heritage areas, and/or are environmental character of the site and its
compatible with adjacent heritage resources. adjacent properties shall be considered in the site
development of each building and facility.
9. Local utility companies (hydro, gas, telephone,
cable) shall be required to place metering 2. The height and bulk of buildings and structures
equipment, transformer boxes, power lines, shall be so designed that it does not impair the
conduit, equipment boxes, piping, wireless entry of light and ventilation, cause the loss I of
telecommunication towers and other utility privacy and/or create nuisances, hazards or
equipment and devices in locations which do not inconveniences to adjacent developments.
detract from the visual character of heritage
resources, and which do not have a negative 3. Abutments to adjacent properties shall not be
impact on its architectural integrity. allowed without the neighbor's prior written
consent which shall be required by the City
10. Design review approval shall be secured from Planning and Development Office (CPDO) prior to
the CPDO for any alteration of the heritage the granting of a Zoning Permit (Locational
property to ensure that design guidelines and Clearance).
standards are met and shall promote preservation
and conservation of the heritage property. 4. The capacity of parking areas/lots shall be per
(Emphasis supplied) the minimum requirements of the National
Building Code. These shall be located, developed
It is clear that the standards laid down in Section and landscaped in order to enhance the aesthetic
47 of Ordinance No. 8119 only serve as guides, as quality of the facility. In no case, shall parking
it expressly states that "the following shall guide areas/lots encroach into street rights-of-way and
the :development of historic sites and facilities." shall follow the Traffic Code as set by the City.
A guide simply sets a direction 'or gives an
instruction to be followed by prope1iy owners and 5. Developments that attract a significant volume
developers in order to conserve and enhance a of public modes of transportation, such as
property's heritage values. tricycles, jeepneys, buses, etc., shall provide on-
site parking for the same. These shall also provide
On the other hand, Section 48 states: vehicular loading and unloading bays so as street
traffic flow will not be impeded.
SEC. 48. Site Performance Standards. - The City
considers it in the public interest that all projects 6. Buffers, silencers, mufflers, enclosures and
are designed and developed in a safe, efficient and other noise-absorbing I materials shall be provided
aesthetically pleasing manner. Site development to all noise and vibration-producing machinery.
shall consider the environmental character and Noise levels shall be maintained according to levels
limitations of the site and its adjacent properties. specified in DENR DA9 No. 30 - Abatement of
All project elements shall be in complete harmony Noise and Other Forms of Nuisance as Defined by
according to good design principles and the Law.
subsequent development must be visually pleasing
7. Glare and heat from any operation or activity that another project, building, or property, not
shall not be radiated, seen or felt from any point itself a heritage property or building, may be the
beyond the limits of the property. subject of a cease and desist order when it
adversely affects the background view, vista, or
8. No large commercial signage and/or pylon, sightline of a heritage property or building. Thus,
which will be detrimental to the skyline, shall Republic Act No. 10066 cannot apply to the Torre
be allowed. de Manila condominium project.

9. Design guidelines, deeds of restriction, property Mandamus does not lie against the City of
management plans and other regulatory tools that Manila.
will ensure high quality developments shall be
required from developers of commercial The Constitution states that "[n]o person shall be
subdivisions and condominiums. These shall be deprived of life, liberty or 1property without due
submitted to the City Planning and Development process of law x x x." 61 It is a fundamental
Office (CPDO) for review and approval. (Emphasis principle that no property shall be taken away from
supplied) an individual without due process, whether
substantive or procedural. The dispossession of
Se9tion 4 7 of Ordinance No. 8119 specifically property, or in this case the stoppage of the
regulates the "development of historic sites and construction of a building in one's own property
facilities."Section 48 regulates "large commercial would violate substantive due process.
signage and/or pylon." There is nothing in
Sections 47 and 48 of Ordinance No. 8119 that The Rules on Civil Procedure are clear that
disallows the construction of a building outside mandamus only issues when there is a clear legal
the boundaries of a historic site or duty imposed upon the office or the officer sought
facility, where such building may affect the1 to be compelled to perform an act, and when the
background of a historic site. In this case, the party seeking mandamus has a clear legal right to
Torre de Manila stands 870 meters outside and to the performance of such act.
the rear of the Rizal Monument and "cannot
possibly obstruct the front view of the [Rizal] In the present case, nowhere is it found in
Monument." 57 Likewise, ;the Torre de Manila is not Ordinance No. 8119 or in any law, ordinance, or
in an area that has been declared as an rule for that matter, that the construction of a
"anthropological or archeological area" or in an building outside the Rizal Park is prohibited if the
area designated as a heritage zone, cultural building is within the background sightline or view
property, historical landmark, or a national of the Rizal Monument. Thus, there is no legal duty
treasure by the NHCP. 58 on the part of the City of Manila "to consider," in
the words of the Dissenting Opinion, "the
Section 15, Article XIV of the Constitution, which standards set under Ordinance No. 8119" in
deals with the subject of arts and culture, provides relation to the applications of DMCI-PDI for the
that "[t]he State shall conserve, promote and Torre de Manila since under the ordinance these
popularize the nation's historical and cultural standards can never be applied outside the
heritage and resources x x x." Since this provision boundaries of Rizal Park. While the Rizal Park
is not self-executory, Congress passed laws dealing has been declared a National Historical Site, the
with the preservation and conservation of our area where Torre de Manila is being built is a
cultural heritage. privately-owned property that is "not pap: of the
Rizal Park that has been declared as a National
One such law is Republic Act No. 10066,59 or Heritage Site in 1095," and the Torre de Manila
the National Cultural Heritage Act of 2009, which area is in fact "well-beyond" the Rizal Park,
empowers the National Commission for Culture according to NHCP Chairperson Dr. Maria Serena
and the Arts and other cultural agencies to issue a I. Diokno. 62 Neither has the area of the Torre de
cease and desist order "when the physical Manila been designated as a "heritage zone, a
integrity of the national cultural treasures or cultural property, a historical landmark or even a
important cultural properties [is] found to be in national treasure."63
danger of destruction or significant alteration
from its original state."60 This law declares that Also, to declare that the City of Manila failed to
the State should protect the "physical integrity" of consider the standards under Ordinance No. 8119
the heritage property or building if there is "danger would involve making a finding of fact. A finding lot
of destruction or significant alteration from its fact requires notice, hearing, and the submission
original state." Physical integrity refers to the of evidence to ascertain compliance with the law or
structure itself - how strong and sound the regulation. In such a case, it is the Regional Trial
structure is. The same law does not mention Court which has the jurisdiction to hear the case,
receive evidence, make a proper finding of fact, and 1) there be an actual case or controversy calling for
determine whether the Torre de Manila project the exercise of judicial power;
properly complied with the standards set by the
ordinance. In Meralco v. Public Service 2) the person challenging the act must have
Commission, 64 we held that it is the cardinal right "standing" to challenge; he must have a personal
of a party in trials and administrative proceedings and substantial interest in the case such that he
to be heard, which includes the right of the party has sustained, or will sustain, direct injury as a
interested or affected to present his own case and result of its enforcement;
submit evidence in support thereof and to have
such evidence presented considered by the proper 3) the question of constitutionality must be raised
court or tribunal. at the earliest possible opportunity; and

To compel the City of Manila to consider the 4) the issue of constitutionality must be the
standards under Ordinance No. 8119 to the Torre very lismota of the case.
de Manila project will be an empty exercise since
these standards cannot apply outside of the Rizal
The lower court's decision under the constitutional
Park - and the Torre de Manila is outside the Rizal
scheme reaches the Supreme Court through the
Park. Mandamus will lie only if the officials
appeal process, through a petition for review
on certiorari under Rule 45 of the Rules of Court.
The KOR also invokes this Court's exercise of its
extraordinary certiorari power of review under
In the present case, the KOR elevated this case
Section 1, Article VIII65 of the Constitution.
immediately to this Court in an original petition for
However, this Court can only exercise its
injunction which we later on treated as one for
extraordinary certiorari power if the City of Manila,
mandamus under Rule 65. There is, however, no
in issuing the required permits and
clear legal duty on the City of Manila to consider
licenses, gravely abused its discretion
the provisions of Ordinance No. 8119 for
amounting to lack or excess of
applications for permits to build outside the
jurisdiction. Tellingly, neither the majority nor
protected areas of the Rizal Park. Even if there
minority opinion in this case has found that the
were such legal duty, the determination of whether
City of Manila committed grave abuse of discretion
the City of .Manila failed to abide by this legal duty
in issuing the permits and licenses to DMCI-PDI.
would involve factual matters which have not been
Thus, there is no justification at all for this Court
admitted or established in this case. Establishing
to exercise its extraordinary certiorari power.
factual matters is not within the realm of this
Court. Findings of fact are the province of the trial
Moreover, the exercise of this Court's courts.
extraordinary certiorari power is limited to actual
cases and controversies that necessarily involve a
There is no standard in Ordinance No. 8119 for
violation of the Constitution or the determination
defining or determining the background sightline
of the constitutionality or validity of a
that is supposed to be protected or that is part of
governmental act or issuance. Specific violation of
the "physical integrity" of the Rizal Monument.
a statute that does not raise the issue of
How far should a building like the Torre de Manila
constitutionality or validity of the statute cannot,
be from the Rizal Monument - one, two, three, four,
as a rule, be the subject of the Court's direct
or five kilometers? Even the Solicitor General,
exercise of its expanded certiorari power. Thus, the
during the Oral Arguments, conceded that the
KOR's recourse lies with other judicial remedies or
ordinance does not prescribe how sightline is
proceedings allowed under the Rules of Court.
determined, neither is there any way to measure by
metes and bounds whether al construction that
In Association of Medical Clinics for Overseas is not part of the historic monument itself or is
Workers, Inc. v. GCC Approved Medical Centers outside the protected area can be said to violate
Association, Inc., 66we held that in cases where the the Rizal Monument's physicalintegrity, except
question of constitutionality of a governmental only to say "when you stand in front of the Rizal
action is raised, the judicial power that the courts Monument, there can be no doubt that your view is
exercise is likewise identified as the power of marred and impaired." This kind of a standard has
judicial review - the power to review the no parameters and can include a sightline or a
constitutionality of the actions of other branches of construction as far as the human eyes can see
government. As a rule, as required by when standing in front of the Rizal Monument.
the hierarchy of courts principle, these cases are Obviously, this Court cannot apply such a
filed with the lowest court with jurisdiction over subjective and non-uniform standard that
the 1subject matter. The judicial review that the adversely affects property rights several kilometers
courts undertake requires: away from a historical sight or facility.
The Dissenting Opinion claims that "the City, by branch unless there is a clear showing of grave
reason of a mistaken or erroneous construction of abuse of discretion amounting to lack or excess of
its own Ordinance, had failed to consider its duties jurisdiction. Mandamus does not lie against the
under [Ordinance No. 8119] when it issued permits legislative and executive branches or their
in DMCI-PDI's favor." However, MZBAA Zoning members acting in the exercise of their official
Board Resolution Nos. 06 and 06-A67 easily dispel discretionary functions. This emanates from the
this claim. According to the resolutions, the City of respect accorded by the judiciary to said branches
Manila, through the MZBAA, acted on DMCI-PDI's as co-equal entities under the principle of
application for variance under the powers and separation of powers.
standards set forth in Ordinance No. 8119.
In De Castro v. Salas,71 we held that no rule of law
Without further proof that the MZBAA acted is better established than the one that provides
whimsically, capriciously, or arbitrarily in issuing that mandamus will not issue to control the
said resolution, the Court should respect MZBAA's discretion of an officer or a court when honestly
exercise of discretion. The Court cannot "substitute exercised and when such power and authority is
its I judgment :for that of said officials who are in a not abused.
better position to consider and weigh the same in
the light of the authority specifically vested in them In exceptional cases, the Court has granted a
by law." 68 Since the Court has "no supervisory prayer for mandamus to compel action in matters
power over the proceedings I and actions of the involving judgment and discretion, only "to act, but
administrative departments of the government," it not to act lone way or the other," 72 and only in
"should not generally interfere with purely cases where there has been a clear showing of
administrative and discretionary functions.; 69 The grave abuse of discretion, manifest injustice, or
power of the Court in mandamus petitions does palpable excess of authority.73
not extend "to direct the exercise of judgment or
discretion in a particular way or the retraction In this case, there can be no determination by this
or reversal of an action already taken in the Court that the City of Manila had been negligent or
exercise of either."70 remiss in its duty under Ordinance No. 8119
considering that this determination will involve
Still, the Dissenting Opinion insists on directing questions of fact. DMCI- PDI had been issued the
the re-evaluation by the City of Manila, through proper permits and had secured all approvals and
the CPDO, of the permits previously issued in favor licenses months before the actual construction
of the Torre de Manila project to determine began. Even the KOR could not point to any law
compliance with the standards ]under Ordinance that respondent City of Manila had violated and
No. 8119. It also declares that the circumstances could only point to declarations of policies by the
in this case warrant the prohacvice conversion of NHCP and the Venice Charter which do not
the proceedings in the issuance of the permits into constitute clear legal bases for the issuance of a
a "contested case" necessitating notice and hearing writ of mandam1s.
with all the parties involved.
The Venice Charter is merely a codification of
Prohac vice means a specific decision does not guiding principles for the preservation and
constitute a precedent because the decision is for restoration of ancient monuments, sites, and
the specific case only, not to be followed in other buildings. It brings I together principles in the field
cases. A prohac vice decision violates statutory law of historical conservation and restoration that have
- Article 8 of the Civil Code - which states that been developed, agreed upon, and and laid down
"judicial decisions applying or interpreting the laws by experts over the years. Each country, however,
or the Constitution shall form part of the legal remains "responsible for applying the plan within
system of the Philippines." The decision of the the framework of its own culture and traditions."74
Court in this case cannot be prohac vice because
by mandate bf the law everydecision of the Court The Venice Charter is not a treaty and therefore
forms part of the legal system of the Philippines. If does not become enforceable as law. The
another case comes up with the same facts as the Philippines is not legally bound to follow its
present case, that case must be decided in the directive, as in fact, these are not directives but
same way as this case to comply with the mere guidelines - a set of the best practices and
constitutional mandate of equal protection of the techniques that have been proven over the years to
law. Thus, a prohac vice decision also violates the be the most effective in preserving and restoring
equal protection clause of the Constitution. historical monuments, sites and buildings.

It is the policy of the courts not to interfere with The City of Manila concedes that DMCI-PDI's
the discretionary executive acts of the executive Zoning Permit was granted without going through
the process under Ordinance No. 8119. However, During the Oral Arguments, it was established that
the same was properly rectified when, faced with the granting of a variance neither uncommon nor
mounting opposition, DMCI-PDI itself sought irregular. On the contrary, current practice has
clarification from the City of Manila and made granting of a variance the rule rather than
immediately began complying with the procedure the exception:
for applying for a variance. The MZBAA did
subsequently recommend the approval of the JUSTICE CARPIO: Let's go to Ordinance 8119. For
variance and the City Council of Manila approved residential condominium that stand alone, in other
the same, ratifying the licenses and permits words not part of a commercial complex or an
already given to DMCI-PDI. Such ratification was industrial complex ...
well within the right of the City Council of Manila.
The City Council of Manila could have denied the ATTY. FLAMINIANO: Yes, Your Honor.
application had it seen any reason to do so. Again,
the ratification is a function of the City Council of
JUSTICE CARPIO: The [Floor Area Ratio (FAR)] is
Manila, an exercise of its discretion1 and well
uniform for the entire City of Manila, the FAR 4,
within the authority granted it by law and the
correct? ATTY. FLAMINIANO: I believe so, Your
City's own Ordinance No. 8119.
Honor, it's FAR 4.
The main purpose of zoning is the protection of
JUSTICE CARPIO: So it's FAR 4 for all residential
public safety, health, convenience, and welfare.
There is no indication that the Torre de Manila condominium complex or industrial projects.
project brings any harm, danger, or hazard to the
people in the surrounding areas except that the ATTY. FLAMINIANO: There might be, the FAR
building allegedly poses an unsightly view on the might be different when it comes to condominiums
taking of photos or the visual appreciation of the in commercial areas, Your Honor.
Rizal Monument by locals and tourists. In fact, the
Court must take the approval of the MZBAA, and JUSTICE CARPIO: Yes, I'm talking of stand-
its subsequent ratification by the City Council of alone ...
Manila, as the duly authorized exercise of
discretion by the city officials. Great care must be ATTY. FLAMINIANO: Yes, Your Honor.
taken that the Court does not unduly tread upon
the local government's performance of its duties. It JUITICE CARPIO: ... residential condominiums...
is not for this Court to dictate upon the other
branches bf the government how their discretion
ATTY. FLAMINIANO: Uniform at FAR 4, Your
must be exercised so long as these branches do not
commit grave abuse of discretion amounting to
lack or excess of jurisdiction.
JUSTICE CARPIO: And the percentage of land
occupancy is always 60 percent.
Likewise, any violation of Ordinance No. 8119
must be determined in the proper case and before
the proper forum. It is not within the power of this ATTY. FLAMINIANO: 60 percent correct, Your
Court in this case to make such determination. Honor.
Without such determination, this Court cannot
simply declare that the City of Manila had failed to JUSTICE CARPIO: Okay ... how many square
consider its duties under Ordinance No. 8119 meters is this Torre de Manila?
when it issued the permits in DMCI-PDI's favor
without making a finding of fact how the City of xxx
Manila failed "to consider" its duties with respect to
areas outside the boundaries of the Rizal Park. In ATTY. FLAMINIANO: The land area, Your Honor,
the first place, this Court has no jurisdiction to it's almost 5,000 ... 5,556.
make findings of fact in an original action like this
before this Court. Moreover the City of Manila
JUSTICE CARPIO: So, it's almost half a hectare.
could not legally apply standards to sites outside
the area covered by the ordinance that prescribed
the standards. With this, I taken in light of the lack ATTY. FLAMINIANO: Yes, Your Honor.
of finding that there was grave abuse of discretion I
on the part of the City of Manila, there is no basis JUSTICE CARPIO: And at FAR 4, it can only build
to issue the writ of mandamus against the City of up to 18 storeys, I mean at FAR 4, is that correct?
ATTY. FLAMINIANO: If the 60 percent of the lot...
JUSTICE CARPIO: Yes, but that is a rule. This, the MZBAA's grant of the variance cannot
be used as a basis to grant the mandamus
ATTY. FLAMINIANO: That is a rule, that's the rule, petition absent any clear finding that said act
Your Honor. amo'1nted to "grave abuse of discretion,
manifest injustice, or palpable excess of
JUSTICE CARPIO: 60 percent of... authority."

ATTY. FLAMINIANO: Of the land area. The KOR is Estopped from Questioning the
Torre de Manila Construction.
JUSTICE CARPIO: ... buildable, the rest not
buildable. The KOR is now estopped from questioning the
construction of the Torre de Manila project. The
KOR itself came up with the idea to build a
ATTY. FLAMINIANO: Yes, Your Honor. structure right behind the Rizal Monument that
would dwarf the Rizal Monument.
JUSTICE CARPIO: Okay, so if you look around
here in the City of Manila anywhere you go, you In the mid-1950s, the Jose Rizal National
look at stand alone residential condominium Centennial Commission (JRNCC) l formulated a
buildings... plan to build an Educational Center within the
Rizal Park. In July 1955, the KOR proposed the
ATTY. FLAMINIANO: There's a lot of them, Your inclusion of a national theater on the site of the
Honor. Educational Center. The JRNCC adopted the
proposal. The following[ year, a law - Republic Act
JUSTICE CARPIO: It's always not FAR 4, it's more No. 142776 - authorized the establishment of the
than FAR 4. Jose Rizal National Cultural Shrine consisting of a
national theater, a national museum, and a
ATTY. FLAMINIANO: Yes, Your Honor. national library on a single site. 77

JUSTICE CARPIO: And the buildable area is to the To be built on the open space right behind the 12.7
edge of the property's not 60 percent, correct? meter high Rizal Monument were: the KOR's
proposed nationaltheater, standing 29.25 meters
ATTY. FLAMINIANO: Yes, Your Honor. high and 286 meters in distance from the Rizal
Monument; the nationallibrary, standing 25 .6
meters high and 180 meters in distance from the
JUSTICE CARPIO: So, if you look at all the ...
Rizal ;Monument, with its rear along San Luis
residential buildings in the last ten years, they
Street (now T.M. Kalaw Street); and facing it,
[have] all variances. They did not follow the
the nationalmuseum, at 19.5 meters high and 190
original FAR 4 or the 60 percent (of land
meters in I distance from the Rizal Monument,
occupancy). Every residential building that
with its back along P. Burgos Street. 78
stand alone was a variance. ATTY.
FLAMINIANO: That's correct, Your Honor.
However, several sectors voiced their objections to
the construction for various reasons. Among them,
JUSTICE CARPIO: So the rule really in the City
the need to preserve the open space of the park,
of Manila is variance, and the exception which
the high cost of construction, the desecration of
is never followed is FAR 4.
the park's hallowed grounds, and the fact that
the proposed cultural center including the
ATTY. FLAMINIANO: FAR 4, it appears to be 129.25 meter high national theater proposed by
that way, Your Honor. the KOR would dwarf the 12.7 meter high Rizal
Monument. 79 The JRNCC revised the plan and
xxxx only the National Library - which still stands today
- was built. 80
JUSTICE CARPIO: Every developer will have to
get a variance because it doesn't make sense to According to the NHCP, the KOR even proposed to
follow FAR 4 because the land is so expensive build a Rizal Center on the park as recently as
and if you can build only two storeys on a 2013.81 The proposal was disapproved by the
1,000-square meter lot, you will surely lose NHCR and the Department of Tourism.
money, correct? ATTY. FLAMINIANO: Exactly,
Your Honor. 75 (Emphasis supplied)
Surely, as noble as the KOR's intentions were, its It can easily be gleaned that the Torre de Manila is
proposed center would have dwarfed the Rizal not a nuisance per se. The Torre de Manila project
Monument with its size and proximity. cannot be considered as a "direct menace to I
public health or safety." Not only is a condominium
In contrast, the Torre de Manila is located well project commonplace in the City of Manila, DMCI-
outside the Rizal Park, and to the rear of the Rizal PDI has, according to the proper government
Monument - approximately 870 meters from the agencies, complied with health and safety
Rizal Monument and 3 0 meters from the edge of standards set by law. DMCI-PDI has been granted
Rizal Park. 82 the following permits and clearances prior to
starting the project: (1) Height Clearance Permit
It is a basic principle that "one who seeks equity from the Civil Aviation Authority of the
and justice must come to court with clean hands. Philippines;91 (2) Development Permit from the
"83 In Jenosa v. Delariarte, 84 the Court reiterated HLURB;92 (3) Zoning Certification from the
,that he who seeks equity must do equity, and he HLURB;93 (4) Certificate of Environmental
who comes into equity must come with clean Compliance Commitment from the Environment
hands. This "signifies that a litigant may be denied Management Bureau of the Department of
relief by a court of equity on the ground that his Environment and Natural Resources;94 (5)
conduct has been inequitable, unfair and Barangay Clearance (6) Zoning Permit;96 (7)

dishonest, or fraudulent, or deceitful as to the Building Permit;97 (8) and Electrical and
controversy in issue. " 85Thus, the KOR, having Mechanical Permit.98
earlier proposed a national theater a mere
286meters in distance from the back of the Rizal Later, DMCI-PDI also obtained the right to build
Monument that would have dwarfed the Rizal under a variance recommended by the MZBAA and
Monument, comes to this I Court with unclean granted by the City Council of Manila. Thus, there
hands. It is now precluded from "seeking any can be no doubt that the Torre de Manila project is
equitable refuge" 86 from the Court. The KOR's not a nuisance perse.
petition should be dismissed on this ground alone.
On the other hand, the KOR now claims that the
Torre de Manila is Not a Nuisance Per Se. Torre de Manila is a nuisance peraccidens.

In its petition, the KOR claims that the Torre de By definition, a nuisance peraccidens is
Manila is a nuisance perse that deserves to be determined based on its surrounding conditions
summarily abated even without judicial and circumstances. These conditions and
proceedings. 87 However, during the Oral circumstances must be well established, not
Arguments, counsel for the KOR argued that the merely alleged. The Court cannot simply accept
KOR now believes that the Torre de Manila is a these conditions and circumstances as established
nuisance per accidens and not a nuisance perse. 88 facts as the KOR would have us do in this
case. 99 The KOR itself concedes that the question
Article 694 of the Civil Code defines a nuisance as of whether the Torre de Manila is a
any act, omission, establishment, business, nuisance peraccidens is a question of fact. 100
condition of property, or anything else which: (1)
injures or endangers the health or safety of others; The authority to decide when a nuisance exists is
(2) annoys or offends the senses; (3) shocks, defies an authority to find facts, to estimate their force,
or disregards decency or morality; (4) obstructs or and to apply rules of law to the case thus
interferes with the free passage of any public made. 101 1lhis Court is no such authority. It is not
highway or street, or any body of water; or (5) a trier of facts. It cannot simply take the
hinders or impairs the use of property. allegations in the petition and accept these as
facts, more so in this case where these allegations
Thy Court recognizes two kinds of nuisances. The are contested by the respondents.
first, nuisance perse, is on "recognized as a
nuisance under any and all circumstances, The task to receive and evaluate evidence is lodged
because it constitutes a direct menace to public with the trial courts. The question, then, of
health or safety, and, for that reason, may be whether the Torre de Manila project is a
abated summarily under the undefined law of nuisance peraccidens must be settled after due
necessity." 89 The second, nuisance peraccidens, is proceedings brought before the proper Regional
that which "depends upon certain conditions and Trial Court. The KOR cannot circumvent the
circumstances, and its existence being a question process in the guise be protecting national culture
of fact, it cannot be abated without due hearing and heritage.
thereon in a tribunal authorized to decide whether
such a thing in law constitutes a nuisance. "90 The TRO must be lifted.
Injunctive reliefs are meant to preserve substantive [Ako’y mamamatay, ngayong namamalas
rights and prevent further injury102 until final na sa Silanganan ay namamanaag
adjudication on the merits of the case. In the yaong maligayang araw na sisikat
present case, since the legal rights of the KOR are sa likod ng luksang nagtabing na ulap.] 109
not well-defined, clear, and certain, the petition for
mandamus must be dismissed and the TRO lifted. [I die just when I see the dawn break,
Through the gloom of night, to herald the day] 110
The general rule is that courts will not disturb the
findings of I administrative agencies when they are Yet at the point of his execution, he was made to
supported by substantial evidence. In this case, stand facing West towards Manila Bay, with his
DMCI-PDI already acquired vested rights in the back to the firing squad, like the traitor the
various permits, licenses, or even variances it had colonial government wished to portray him. He
applied for in order to build a 49-storey building asked to face his executioners, facing the East
which is, and had been, allowed by the City of where the sun would be rising since it was early
Manila's zoning ordinance. morning, but the Spanish captain did not allow it.
As he was shot and a single bullet struck his frail
As we have time and again held, courts generally body, Rizal forced himself, with his last remaining
hesitate to review discretionary decisions or strength, to turn around to face the East and thus
actions of administrative agencies in the absence of he fell on his back with] his face to the sky and the
proof that such decisions or actions were arrived at rising sun. Then, the Spanish captain approached
with grave abuse of discretion amounting to lack or Rizal and finished him off with one pistol shot to
excess of jurisdiction. his head.

In JRS Business Corp. v. Montesa, 103 we held that Before his death, Rizal wrote a letter to his family.
mandamus is the proper remedy if it could be He asked for a simple tomb, marked with a cross
shown that there was neglect on the part of a and a stone with only his name and the date of his
tribunal in the performance of an act which the birth and death; no anniversary celebrations; and
law specifically enjoins as a duty, or there was an interment at Paang Bundok(now, the Manila North
unlawful exclusion of a party from the use and Cemetery). Rizal never wanted his grave to be a
enjoyment be a right to which he is clearly entitled. burden to future generations.
Only specific legal rights may be enforced by
mandamus if they are clear and certain. If the legal The letter never made it to his family and his
rights of th6 petitioner are not well-defined, wishes were not carried out. The letter was
definite, clear, and certain, 104 the petition must be discovered many years later, in 1953. By then, his
dismissed. Stated otherwise, the writ never issues remains had been entombed at the Rizal
in doubtful cases. It neither confers powers nor Monument, countless anniversaries had been .
imposes duties. It is simply a command to exercise celebrated, with memorials and monuments built
a power already possessed and to perform a duty throughout the world.
already imposed. 105
Rizal's wish was unmistakable: to be buried
In sum, bearing in mind the Court does not without pomp or pageantry; to the point of
intervene in discretionary acts of the executive reaching oblivion or obscurity in the future. 111 For
department in the absence of grave abuse of Rizal's life was never about fame or vainglory, but
discretion, 106 and considering that mandamus for the country he loved dearly and for which he
may only be issued to enforce a clear and certain gave up his life.
legal right, 107 the present special civil action for
mandamus must be dismissed and the TRO issued The Rizal Monument is expressly against Rizal' s
earlier must be lifted. own wishes. That Rizal's statue now stands facing
West towards Manila Bay, with Rizal's back to the
A FINAL WORD East, adds salt to the wound. If we continue the
present orientation of Rizal's statue, with Rizal
It had been Rizal’s wish to die facing the rising facing West, we would be like the Spanish captain
sun. In his Mi Ultimo Adios, the poem he left for his who refused Rizal's request to die facing the rising
family the night before he was executed, Rizal sun in the East. On the other hand, if Rizal' s
wrote: statue is made to face East, as Rizal had desired
when he was about to be shot, the background -
Yo muero cuando veo que el cielo se colora the blue sky above Manila Bay - would forever be
Y al fin anuncia el dia tras lobrego capuz 108 clear of obstruction, and we would be faithful to
Rizal's dying wish.
WHEREFORE, the petition for mandamus and fundamental maxim of a free
is DISMISSED for lack of merit. The Temporary government. (29 C. J. S., 820.)
Restraining Order issued by the Court on 16 June
2015 is LIFTED effective immediately. In a broad sense, expropriation of large
estates, trusts in perpetuity, and land that
SO ORDERED. embraces a whole town, or large section of
a town or city, bears direct relation to the
G.R. No. L-2929 February 28, 1950 public welfare. The size of the land
expropriated, the large number of people
THE CITY OF MANILA, plaintiff-appellant, benefited, and the extent of social and
vs. economic reform secured by the
THE ARRELANO LAW COLLEGES, condemnation, clothes the expropriation
INC., defendant-appellee. with public interest and public use. The
expropriation in such cases tends to
abolish economic slavery, feudalistic
City Fiscal Eugenio Angeles and Assistant City practices, endless conflicts between
Fiscal Arsenio Nañawa for appellant. landlords and tenants, and other evils
Emmanuel Pelaez for appellee. inimical to community prosperity and
contentment and public peace and order.
TUASON, J.: Although courts are not in agreement as to
the tests to applied in determining whether
Section 1 of Republic Act No. 267 provides: the use is public or not, some go so far in
the direction of a liberal construction as to
Cities and municipalities are authorized to hold that public use is synonymous with
contract loans from the Reconstruction public benefit, public utility, or public
Finance Corporation, the Philippine advantage, and to authorize the exercise of
National Bank, and/or other entity or the power of eminent domain to promote
person at the rate of interest not exceeding such public benefit, etc., especially where
eight per cent annum for the purpose of the interest involved are of considerable
purchasing or expropriating homesites magnitude. (29 C. J. S.; 823, 824; see also
within their respective territorial People of Puerto Rico vs. Eastern Sugar
jurisdiction and reselling them at cost to Associate et al., 156 Fed. [2d], 316.) In
residents of the said cities and some instances, slumsites have been
municipalities. acquired by condemnation. The highest
court of New York State has ruled that slum
The court below ruled that this provision empowers clearance and erection of houses for low-
cities to purchase but not to expropriate lands for income families were public purpose for
the purpose of subdivision and resale, and so which New York City Housing authorities
dismissed the present action, which seeks to could exercise the power of condemnation.
condemn, for the purpose just stated, several and this decision was followed by similar
parcels of land having a combined area of 7,270 ones in other states. The underlying
square meters and situated on Legarda Street, City reasons for these decisions are that the
of Manila. destruction of congested areas and
unsanitary dwellings diminished the
potentialities of epidemics, crime and
In the cases of Guido vs. Rural Progress
waste, prevents the spread of crime and
Administration (G. R. No. L-
diseases to unaffected areas, enhances the
2089)1 and Commonwealth of the Philippines vs. De
physical and moral value of the
Borja (G. R. No. L-1496),2 we discussed at great
surrounding communities, and promote the
length the extent of the Philippine Government's
safety and welfare of the public in general.
power to condemn private property for resale.
(Murray et al. vs. La Guardia, 52 N. e. [2d],
Among other things, we said:
884; General Development Coop. vs. City of
Detroit, 33 N. W. [2d], 919; Weizner vs.
It has been truly said that the assertion of Stichman, 64 N. Y. S. [2d], 50.) But it will
the right on the part of the legislature to be noted that in all these cases and of
take the property of one citizen and transfer similar nature extensive areas were
it to another, even for a full compensation, involved and numerous people and the
when the public interest is not promoted general public benefited by the action
thereby, is claiming a despotic power, and taken.
one inconsistent with every just principle
The condemnation of a small property in Colleges' land is situated in a highly commercial
behalf of 10, 20 or 50 persons and their section of the city and is occupied by persons who
families does not insure to the benefit of the are not bona fide tenants. Lastly, this land was
public to a degree sufficient to give the use brought by the defendant for a university site to
public character. The expropriation take the place of rented buildings that are
proceedings at bar have been instituted for unsuitable for schools of higher learning.
the economic relief of a few families devoid
of any consideration of public peace and To authorize the condemnation of any particular
order, or other public advantage. What is land by a grantee of the power of eminent domain,
proposed to be done is to take plaintiff's a necessity must exist for the taking thereof for the
property, which for all we know she proposed uses and purposes. (29 C. J. S., 884-
acquired by sweat and sacrifices for her 885.) In City of Manila vs. Manila Chinese
and her family's security, and sell it at cost Community (40 Phil., 349), this Court, citing
to a few lessees who refuse to pay the American decision, laid done this rule:
stipulated rent or leave the premises.
The very foundation of the right to exercise
No fixed line of demarcation between what eminent domain is a genuine necessity, and
taking is for public use and what is not can that necessity must be of a public
made; each case has to be judged according character. The ascertainment of the
to its peculiar circumstances. It suffices to necessity must precede or accompany, and
say for the purpose of this decision that the not follow, the taking of the land. (Morrison
case under consideration is far wanting in vs. Indianapolis, etc. Ry. Co., 166 Ind., 511;
those elements which make for public Stearns vs. Barre, 73 Vt., 281; Wheeling,
convenience or public use. It is patterned etc. R. R. Co. vs. Toledo, Ry. etc. Co., 72
upon an ideology far removed from the Ohio St., 368.)
majority of the citizens of this country. If
upheld, this case would open the gates to And this passage in Blackstone's Commentaries on
more oppressive expropriations. If this the English Law is cited in that decision: "So great
expropriation be constitutional, we see no is the regard of the law for private property that it
reason why a 10-, 15-, or 25-hectare farm will not authorize the least violation of it, even for
land might not be expropriated and the public good, unless there exist a very great
subdivided, and sold to those who want to necessity thereof."
own a portion of it. to make the analogy
closer, we find no reason why the Rural
Perhaps modern decisions are not so exigent.
Progress Administration could not take by
Necessity within the rule that the particular
condemnation an urban lot containing and
property to be expropriated must be necessary.
area of 1,000 or 2,000 square meters for
does not mean an absolute but only a reasonable
subdivision into tiny lots for resale to its
or practical necessity, such as would combine the
occupations or those who want to build
greatest benefit to the public with the least
inconvenience and expense to the condemning
party and property owner consistent with such
We are inclined to believe that Act No. 267 benefits. (29 C. J. S., 386.) But measured even by
empowers cities to expropriate as well as to this standard, and forgetting for a moment the
purchase lands for homesites. The word private character of the intended use, necessity for
"expropriating," taken singly or with the text, is the condemnation has not been shown. The land in
susceptible of only meaning. But this power to question has cost the owner P140,000. The people
expropriate is necessarily subject to the limitations for whose benefit the condemnation is being
and conditions noted in the decisions above cited. undertaken are so poor they could ill afford to meet
The National Government may not confer its this high price, unless they intend to borrow the
instrumentalities authority which itself may not money with a view to disposing of the property
exercise. A stream can not run higher than its later for a profits. Cheaper lands not dedicated to a
source. purpose so worthy as a school and more suited to
the occupants' needs and means, if really they only
Viewed from another angle, the case at bar is want to own their own homes, are plenty
weaker for the condemnor. In the first place, the elsewhere. On the other hand, the defendant not
land that is the subject of the present only has invested a considerable amount for its
expropriation is only one-third of the land sought property but had the plans for construction ready
to be taken in the Guido case, and about two- and would have completed the project a long time
thirds of that involved in the Borja condemnation ago had it not been stopped by the city authorities.
proceeding. In the second place, the Arellano And again, while a handful of people stand to
profits by the expropriation, the development of a even for a full compensation, when the public
university that has a present enrollment of 9,000 interest is not promoted thereby, is claiming a
students would be sacrificed. Any good that would despotic power, and one inconsistent with every
accrue to the public from providing homes to a few just principle and fundamental maxim of a free
families fades into insignificance in comparison government. (29 G.J.S. 820.)
with the preparation of a young men and young
women for useful citizenship and for service to the "In a broad sense, expropriation of large estates,
government and the community, a task which the trusts in perpetuity, and land that embraces a
government alone is not in a position to undertake. whole town, or a large section of a town or city,
As the Rural Progress Administration, the national bears direct relation, to the public welfare. The size
agency lands for resale as homesites and to which of the land expropriated, the large number of
the petition to purchase the land in question on people benefited, and the extent of social and
behalf of the occupants was referred by the economic reform secured by the condemnation,
President, turning down the occupants request clothes the expropriation with public interest and.
after proper investigation, commented that "the public use. The expropriation in such cases tends
necessity of the Arellano Law College to acquire a to abolish economic slavery, feudalistic practices,
permanent site of its own is imperative not only endless conflicts between landlords and tenants,
because denial of the same would hamper the and other evils inimical to community prosperity
objectives of that educational institution, but it and contentment and public peace and order.
would likewise be taking a property intended Although courts are not in agreement as to the
already for public benefit." The Mayor of the City of tests to be applied in determining whether the use
Manila himself confessed that he believes the is public or not, some go so far in the direction of a
plaintiff is entitled to keep this land. liberal construction as to hold that public use is
synonymous with public benefit, public utility, or
public advantage, and to authorize the exercise of
The order of the Court of First Instance of Manila is
the power of eminent domain to promote such
affirmed without costs.
public benefit, etc., especially where the interests
involved are of considerable magnitude. (29 C.J.S.
City of Manila v. Arellano 823, 82; see also People of Puerto Rico vs. Eastern
Sugar Associates et al, 156 Fed. [2d] 316.) In some
TUASON, J.: instances, slumsites have been, acquired by
condemnation. The highest court of New York State
Section 1 of Republic Act No. 267 provides: has ruled that slum clearance and erection of
"Cities and municipalities are authorized to houses for low-income families were public
contract loans from the Reconstruction Pi-nance purposes for which New York City Housing
Corporation, the Philippine National Bank, and/or authorities could exercise the power of
any other entity or person at a rate of interest not condemnation. And this decision was followed by
exceeding eight per cent per annum for the similar ones in other states. The underlying
purpose of purchasing or expropriating homesites reasons for these decisions are that the destruction
within their respective territorial jurisdiction and of congested areas and insanitary dwellings
reselling them at cost to residents of the said cities diminishes the potentialities of epidemics; crime
and municipalities." and waste, prevents the spread of crime and
The court below ruled that this provision empowers diseases to unaffected areas, enhances the
cities to purchase but not to expropriate lands for physical and moral value of the surrounding
the purpose of subdivision and resale, and so communities, and promotes the safety and welfare
dismissed the present action, which seeks to of the public in general. (Murray fit al. vs. La
condemn, for the purpose just stated, several Guardia, 52 N.E. [2d] 884; General Development
parcels of land having a combined area of 7270 Coop. vs. City of Detroit, 33 N.W. [2d] 919;
square meters and situated on Legarda Street, City Weizner vs. Stichman, 64 N. Y. S. [2d] 50.) But it
of Manila. will be noted that in all these "cases and others of
similar nature extensive areas were involved and
In the cases of Guide vs. Rural Progress numerous people and the general public benefited
Administration, (G. R. No. L-2089), [1] and by the action taken.
Commonwealth of the Philippines vs. Borja, (G. R.
No. L-1496),[2] we discussed at great length the "The condemnation of a small property in behalf of
extent of the Philippine Government's power to 10, 20 or 50 persons and their families does not
condemn private property for resale. Among other inure to the benefit of the public to a degree
things, we said: sufficient to give the use public character. The
expropriation proceedings at bar have been
"It has been truly said that the assertion of the instituted for the economic relief of a few families
right on the part of the legislature to take the devoid of any consideration of public health, public
property of one citizen and transfer it to another,
peace and order, or other public advantage. What (40 Phil., 349), this court, citing American
is proposed to be done is to take plaintiff's decisions, laid down this rule:
property, which for all we know she acquired by
sweat and sacrifice for her and her family's "The very foundation of the right to exercise
security, and sell it at cost to a few lessees who eminent domain is a genuine necessity, and that
refuse to pay the stipulated rent or leave the necessity must be of a public character. The
premises. ascertainment of the necessity must precede or
accompany, and not follow, the taking of the land.
"No fixed line of demarcation between what taking (Morrison vs. Indianapolis, etc. Ry. Co., 166 Ind.,
is for public use and what is not can be made; 511; Stearns vs. Barre, 73 Vt., 281; Wheeling, etc.
each case has to be judged according to its R. R. Co. vs. Toledo, Ry. etc. Co., 72 Ohio St.,
peculiar circumstances. It suffices to say for the 368.)"
purpose of this decision that the case under
consideration is far wanting in those elements And this passage in Blackstone's Commentaries on
which make? for public convenience or public use. the English Law is cited in that decisions "80 great
It is patterned upon an ideology far removed from is the regard of the law for private property that it
that consecrated in our system of government and will not authorize the least violation of it, even for
embraced by the majority of the citizens of this the public good, unless there exists a very great
country. If upheld, this case would open the gates necessity thereof."
to .more oppressive expropriations. If this
Perhaps modern decisions are not so exigent.
expropriation be constitutional, we see no reason
Necessity within the rule that the particular
why a 10-, 15-, or 25-hectare farm land might not
property to be expropriated must be necessary,
be expropriated and subdivided, and sold to those
does not mean an. absolute but only a reasonable
who want to own a portion of it. To make the
or practical necessity, such as would combine the
analogy closer, we find no reason why the Rural
greatest benefit to the public with the least
Progress Administration could not take by
inconvenience and expense to the condemning
condemnation an urban lot containing an area of
party and property owner consistent with such
1,000 or 2,000 square meters for subdivision into
benefit, (29 C. T. S. 386.) But. measured even by
tiny lots for resale to its occupants or those who
this standard, and forgetting for a moment the
want to build thereon.
private character of the intended use, necessity for
We are inclined to believe that Act No. 267 the condemnation has not been shown. The land in
empowers cities to expropriate as well as to question has cost, the owner P140,000. The people
purchase lands for homesites. The word for whose benefit the condemnation is being
"expropriating", taken singly or the text, is undertaken are so poor they could ill afford to meet
susceptible of only one meaning. But this power to this high price, unless they intend to borrow the
expropriate is necessarily subject to the limitations money with a view to disposing of the property
and conditions noted in the decisions above cited. later for a profit. Cheaper lands not dedicated to a
The National Government nay not confer upon its purpose so worthy as a school and more suited to
instrumentalities authority which it itself may not the occupants' needs and means, if really they only
exercise. A stream can not run higher than its want to own their own homes, are aplenty
source. elsewhere. On the other hand, the defendant not
only has invested a considerable amount for its
Viewed from another angle, the case at bar is we property but had the plans for construction ready
alter for the condemnor. In the first place, the land and would have completed the project a long time
that is the subject of the present expropriation is ago had it not been stopped by the city authorities.
only one-third of the land sought to be taken in the And again, while a handful of people stand to profit
Guido case, and about two-thirds of that involved by the expropriation, the development of a
in the Borja condemnation proceeding. In the university that has a present enrollment of 9j000
second place, the Arellano Colleges' land is students would be sacrificed. Any good that would
situated in a highly commercial section of the city accrue to the public from providing homes to a few
and is occupied by persons who are not bona fide, families fades into insignificance in comparison
tenants. Lastly, this land was bought by the with the preparation of young men and young
defendant for a university site to take the place of women for useful citizenship and for service to the
rented buildings that are unsuitable for schools of government and the community, a task which the
higher learning. government alone is not in a position to undertake.
As the Rural Progress Administration, the national
To authorize the condemnation of any particular agency created by the Government to purchase or
land by a grantee of the power of eminent domain, expropriate lands for resale as homesites, and to
a necessity must exist for the taking thereof for the which the petition to purchase the land in question
proposed uses and purposes. (29 C. J. S. 884-885.) on behalf of the occupants was referred by the
In City of Manila vs. Manila Chinese Community, President, turned down the occupants' request
after proper investigation, commenting that "the
Per its October 19, 2005 Resolution, the Court
necessity of the Arellano Law College to acquire a
permanent site of its own is imperative not only ordered the consolidation of both cases.
because denial of the same would hamper the
objectives of that educational institution, but it
would likewise be taking a property intended Except for the names of the parties and the specific
already for public benefit." The Mayor of the City of
Manila himself confessed that he believes the lot designation involved, the relevant factual
plaintiff is entitled to keep this land. antecedents which gave rise to these consolidated
The order of the Court of First Instance of Manila is petitions are, for the most part, as set forth in the
affirmed without costs.
Courts Decision[4] of October 15, 2003, as
reiterated in a Resolution dated August 9, 2005,
GR No. 168770
VELASCO, JR., J.: in G.R. No. 156273 entitled Heirs of Timoteo
#6 case Moreno and Maria Rotea v. Mactan-Cebu
International Airport Authority (Heirs of
At the center of these two (2) Petitions for Review
Moreno), and in other earlier related cases.
on Certiorari under Rule 45 is the issue of the right
of the former owners of lots acquired for the
In 1949, the National Airport Corporation
expansion of the Lahug Airport in CebuCity to
(NAC), MCIAAs predecessor agency, pursued a
repurchase or secure reconveyance of their
program to expand
respective properties.
the Lahug Airport in Cebu City. Through its team
of negotiators, NAC met and negotiated with the
In the first petition, docketed as G.R. No.
owners of the properties situated around the
168770, petitioners Anunciacion vda. de Ouano,
airport, which included Lot Nos. 744-A, 745-A,
Mario Ouano, Leticia Ouano Arnaiz and Cielo
746, 747, 761-A, 762-A, 763-A, 942, and 947 of
Ouano Martinez (the Ouanos) seek to nullify the
the Banilad Estate. As the landowners would later
Decision[1] dated September 3, 2004 of the Court of
claim, the government negotiating team, as a
Appeals (CA) in CA-G.R. CV No. 78027, affirming
sweetener, assured them that they could
the Order dated December 9, 2002 of the Regional
repurchase their respective lands should
Trial Court (RTC), Branch 57 in Cebu City, in Civil
the Lahug Airportexpansion project do not push
Case No. CEB-20743, a suit to compel the
through or once the Lahug Airport closes or its
Republic of the Philippines and/or the Mactan-
operations transferred to Mactan-Cebu Airport.
Cebu International Airport Authority (MCIAA) to
Some of the landowners accepted the assurance
reconvey to the Ouanos a parcel of land.
and executed deeds of sale with a right of
repurchase. Others, however, including the owners
The second petition, docketed as G.R. No. 168812,
of the aforementioned lots, refused to sell because
has the MCIAA seeking principally to annul and set
the purchase price offered was viewed as way
aside the Decision[2] and Resolution[3] dated
below market, forcing the hand of the Republic,
January 14, 2005 and June 29, 2005, respectively,
represented by the then Civil Aeronautics
of the CA in CA-G.R. CV No. 64356, sustaining the
Administration (CAA), as successor agency of the
RTC, Branch 13 in Cebu City in its Decision of
NAC, to file a complaint for the expropriation of Lot
October 7, 1988 in Civil Case No. CEB-18370.
Nos. 744-A, 745-A, 746, 747, 761-A, 762-A, 763-A,
942, and 947, among others, docketed as Civil
Case No. R-1881 entitled Republic v. Damian commercial flights. On the ground, the
Ouano, et al. expropriated lots were never utilized for the
purpose they were taken as no expansion
On December 29, 1961, the then Court of
of Lahug Airport was undertaken. This
First Instance (CFI) of Cebu rendered judgment for
development prompted the former lot owners to
the Republic, disposing, in part, as follows:
formally demand from the government that they be
allowed to exercise their promised right to
hereby rendered: repurchase. The demands went unheeded. Civil

1. Declaring the expropriation of suits followed.

Lots Nos. 75, 76, 76, 89, 90, 91, 92,
105, 106, 107, 108, 104, 921-A, 88,
93, 913-B, 72, 77, 916, 777-A, 918, G.R. No. 168812 (MCIAA Petition)
919, 920, 764-A, 988, 744-A, 745-A,
746, 747, 762-A, 763-A, 951, 942,
720-A, x x x and 947, included in On February 8, 1996, Ricardo L. Inocian and four
the Lahug Airport, Cebu City, others (all children of Isabel Limbaga who
justified in and in lawful exercise of
the right of eminent domain. originally owned six [6] of the lots expropriated);
and Aletha Suico Magat and seven others,

xxxx successors-in-interest of Santiago Suico, the

3. After the payment of the foregoing original owner of two (2) of the condemned lots
financial obligation to the
landowners, directing the latter to (collectively, the Inocians), filed before the RTC in
deliver to the plaintiff the Cebu City a complaint for reconveyance of
corresponding Transfer Certificates
of Title to their respective lots; and real properties and damages against MCIAA. The
upon the presentation of the said
complaint, docketed as Civil Case No. CEB-
titles to the Register of Deeds,
ordering the latter to cancel the 18370, was eventually raffled to Branch 13 of the
same and to issue, in lieu thereof,
new Transfer Certificates of Title in
the name of the plaintiff.[7]

On September 29, 1997, one Albert Chiongbian

In view of the adverted buy-back assurance (Chiongbian), alleging to be the owner of Lot Nos.
made by the government, the owners of the lots no 761-A and 762-A but which the Inocians were now
longer appealed the decision of the trial court. claiming, moved and was later allowed to
Following the finality of the judgment of intervene.
condemnation, certificates of title for the covered
parcels of land were issued in the name of the
Republic which, pursuant to Republic Act No. During the pre-trial, MCIAA admitted the following

6958,[9] were subsequently transferred to MCIAA. facts:

1. That the properties,

At the end of 1991, or soon after the transfer of the
which are the subject matter of Civil
aforesaid lots to MCIAA, Lahug Airport completely Case No. CEB-18370, are also the
properties involved in Civil Case R-
ceased operations, Mactan Airport having opened
to accommodate incoming and outgoing
2. That the purpose of
NAC team of negotiators sometime in 1947 or 1949
the expropriation was for the
expansion of the old Lahug Airport; where he and the other landowners were given the
that the Lahug Airport was not
expanded; assurance that they could repurchase their lands
at the same price in the event

3. That the the Lahug Airport ceases to operate. He further

testified that they rejected the NACs offer. However,
old Lahug Airport was closed
he said that they no longer appealed the decree of
sometime in June 1992; expropriation due to the repurchase assurance
4. That the price paid to
the lot owners in the expropriation adverted to.
case is found in the decision of the
court; and
The MCIAA presented Michael Bacarizas
5. That some properties (Bacarizas), who started working for MCIAA as
were reconveyed by the MCIAA
because the previous owners were legal assistant in 1996. He testified that, in the
able to secure express waivers or course of doing research work on the lots subject
riders wherein the government
agreed to return the properties of Civil Case No. CEB-18370, he discovered that
should the expansion of the same lots were covered by the decision in Civil
the Lahug Airport not materialize.
Case No. R-1881. He also found out that the said
decision did not expressly contain any condition on
During trial, the Inocians adduced evidence the matter of repurchase.
which included the testimony of Ricardo Inocian
(Inocian) and Asterio Uy (Uy). Uy, an employee of Ruling of the RTC
the CAA, testified that he was a member of the
team which negotiated for the acquisition of certain On October 7, 1998, the RTC rendered a
lots in Lahug for the proposed expansion of Decision in Civil Case No. CEB-18370, the
the Lahug Airport. He recalled that he acted as dispositive portion of which reads as follows:
the interpreter/spokesman of the team since
he could speak the Cebuano dialect. He stated that WHEREFORE, in view of the
the other members of the team of negotiators were foregoing, judgment is hereby
rendered directing defendant
Atty. Pedro Ocampo, Atty. Lansang, and Atty. Mactan Cebu International Airport
Saligumba. He recounted that, in the course of the Authority (MCIAA) to reconvey (free
from liens and encumbrances) to
negotiation, their team assured the landowners plaintiffs Ricardo Inocian, Olimpia
that their landholdings would be reconveyed to E. Esteves, Emilia E. Bacalla,
Restituta E. Montana and Raul
them in the event the Lahug Airport would be Inocian Lots No. 744-A, 745-A, 746,
abandoned or if its operation were transferred to 762-A, 747, 761-A and to plaintiffs
Aletha Suico Magat, Philip M. Suico,
the Mactan Airport. Some landowners opted to sell, Doris S. dela Cruz, James M. Suico,
while others were of a different bent owing to the Edward M. Suico, Roselyn S.
Lawsin, Rex M. Suico and Kharla
inadequacy of the offered price. Suico-Gutierrez Lots No. 942 and
947, after plaintiffs shall have paid
MCIAA the sums indicated in the
Inocian testified that he and his mother, decision in Civil Case No. R-1881.
Defendant MCIAA is likewise
Isabel Lambaga, attended a meeting called by the
directed to pay the aforementioned
then the owners of the lots expropriated may, if so
plaintiffs the sum or P50,000.00 as
and for attorneys fees and minded, demand of MCIAA to make good its verbal
P10,000.00 for litigation expenses.
assurance to allow the repurchase of the
Albert Chiongbians properties. To the CA, this assurance, a
intervention should be, as it is
hereby DENIED for utter lack of demandable agreement of repurchase by itself, has
factual basis. been adequately established.
With costs against defendant
On September 21, 2005, the MCIAA filed with Us a

Therefrom, MCIAA went to the CA on petition for review of the CAs Decision, docketed as

appeal, docketed as CA-G.R. CV No. 64356. G.R. No. 168812.

Ruling of the CA
G.R. No. 168770 (Ouano Petition)

On January 14, 2005, the CA rendered Soon after the MCIAA jettisoned
judgment for the Inocians, declaring them entitled the Lahug Airport expansion project, informal
to the reconveyance of the questioned lots as the settlers entered and occupied Lot No. 763-A which,
successors-in-interest of the late Isabel Limbaga before its expropriation, belonged to the
and Santiago Suico, as the case may be, who were Ouanos. The Ouanos then formally asked to be
the former registered owners of the said lots. The allowed to exercise their right to repurchase the
decretal portion of the CAs Decision reads: aforementioned lot, but the MCIAA ignored the
demand. On August 18, 1997, the Ouanos
WHEREFORE, in view of the instituted a complaint before the Cebu City RTC
foregoing premises, judgment is
hereby rendered by against the Republic and the MCIAA for
us DISMISSING the appeal filed in reconveyance, docketed as Civil Case No. CEB-
this case and AFFFIRMING the
decision rendered by the court a quo 20743.
on October 7, 1998 in Civil Case No.
Answering, the Republic and MCIAA
averred that the Ouanos no longer have
enforceable rights whatsoever over the condemned
The CA, citing and reproducing excerpts Lot No. 763-A, the decision in Civil Case No. R-
from Heirs of Moreno,[11] virtually held that the 1881 not having found any reversionary condition.
decision in Civil Case No. R-1881 was conditional,
stating that the expropriation of [plaintiff- Ruling of the RTC
appellees] lots for the proposed expansion of the
Lahug Airport was ordered by the CFI of Cebu By a Decision dated November 28, 2000,
under the impression that Lahug Airport would the RTC, Branch 57 in Cebu City ruled in favor of
continue in operation.[12] The condition, as may be the Ouanos, disposing as follows:
deduced from the CFIs decision, was that should
MCIAA, or its precursor agency, discontinue WHEREFORE, in the light of the
foregoing, the Court hereby renders
altogether with the operation of Lahug Airport, judgment in favor of the plaintiffs,
Anunciacion Vda. De Ouano, Mario
P. Ouano, Leticia Ouano Arnaiz and
Cielo Ouano Martinez and against
Explaining its case disposition, the CA stated that
the Republic of the Philippines and
Mactan Cebu International Airport the decision in Civil Case No. R-1881 did not state
Authority (MCIAA) to restore to
plaintiffs, the possession and any condition that Lot No. 763-A of the Ouanosand
ownership of their land, Lot No. all covered lots for that matterwould be returned to
763-A upon payment of the
expropriation price to defendants; them or that they could repurchase the same
and property if it were to be used for purposes other

2. Ordering the Register of Deeds to than for the Lahug Airport. The appellate court
effect the transfer of the Certificate also went on to declare the inapplicability of the
of Title from defendant Republic of
the Philippines on Lot 763-A, Courts pronouncement in MCIAA v. Court of
canceling TCT No. 52004 in the Appeals, RTC, Branch 9, Cebu City, Melba Limbago,
name of defendant Republic of the
Philippines and to issue a new title et al.,[16] to support the Ouanos cause, since the
on the same lot in the names of affected landowners in that case, unlike the
Anunciacion Vda. De Ouano, Mario
P. Ouano, Leticia Ouano Arnaiz and Ouanos, parted with their property not through
Cielo Ouano Martinez.
expropriation but via a sale and purchase
No pronouncement as to costs. [13]

Acting on the motion of the Republic and MCIAA

The Ouanos filed a motion for
for reconsideration, however, the RTC, Branch 57
reconsideration of the CAs Decision, but was
in Cebu City, presided this time by Judge
denied per the CAs May 26, 2005 Resolution.
Enriqueta L. Belarmino, issued, on December 9,
Hence, they filed this petition in G.R. No.
2002, an Order[14] that reversed its earlier decision
of November 28, 2000 and dismissed the Ouanos

The Issues
Ruling of the CA

G.R. No. 168812

In time, the Ouanos interposed an appeal to the GROUNDS FOR ALLOWANCE OF
CA, docketed as CA-G.R. CV No. 78027.
Eventually, the appellate court rendered a l. THE ASSAILED
Decision[15] dated September 3, 2004, denying the THE REPUBLIC OF ITS ABSOLUTE
WHEREFORE, premises considered,
the Order dated December 9, 2002, ll. THE IMPUNGED
of the Regional Trial Court, DISPOSITIONS INVALIDLY
7th Judicial Region, Branch OVERTURNED THIS HONORABLE
57, Cebu City, in Civil Case No. COURTS FINAL RULINGS IN FERY
CEB-20743, is hereby V. MUNICIPALITY OF

Questions of law presented in this II

Whether or not the testimonial ET AL. AND RESPONDENTS
evidence of the petitioners proving INOCIAN, ET AL. ARE ENTITLED TO
the promises, assurances and RECONVEYANCE OF THE
representations by the airport SUBJECT PROPERTIES SIMPLY ON
officials and lawyers are THE BASIS OF AN ALLEGED
inadmissbale under the Statute of VERBAL PROMISE OR ASSURANCE
Whether or not under the ruling of BE RETUNRED IF THE AIRPORT
this Honorable Court in the heirs of PROJECT WOULD BE
Moreno Case, and pursuant to the ABANDONED.
principles enunciated therein,
petitioners herein are entitiled to
recover their litigated property.
The Courts Ruling
Reasons for Allowances of this
The Republic and MCIAAs petition in G.R. No.
Respondents did not object during 168812 is bereft of merit, while the Ouano petition
trial to the admissibility of
petitioners testimonial evidence in G.R. No. 168770 is meritorious.
under the Statute of Frauds and
have thus waived such objection
and are now barred from raising the At the outset, three (3) fairly established factual
same. In any event, the Statute of premises ought to be emphasized:
Frauds is not applicable herein.
Consequently, petitioners evidence
is admissible and should be duly First, the MCIAA and/or its predecessor agency
given weight and credence, as
initially held by the trial court in its had not actually used the lots subject of the final
original Decision.[19] decree of expropriation in Civil Case No. R-1881 for
the purpose they were originally taken by the
While their respective actions against MCIAA below government, i.e., for the expansion and
ended differently, the Ouanos and the Inocians development of Lahug Airport.
proffered arguments presented before this Court
run along parallel lines, both asserting entitlement Second, the Lahug Airport had been closed
to recover the litigated property on the strength of and abandoned. A significant portion of it had, in
the Courts ruling in Heirs of Moreno. MCIAA has, fact, been purchased by a private corporation for
however, formulated in its Consolidated development as a commercial complex.[20]
Memorandum the key interrelated issues in these
consolidated cases, as follows: Third, it has been preponderantly
established by evidence that the NAC, through its
judgment of condemnation if the
team of negotiators, had given assurance to the
right of repurchase was extended to
affected landowners that they would be entitled to them. A handful failed to prove that
they acted on such assurance when
repurchase their respective lots in the event they they parted with ownership of their
are no longer used for airport purposes. [21] No less land.[25](Emphasis supplied;
citations omitted.)
than Asterio Uy, the Court noted in Heirs of
Moreno, one of the members of the CAA Mactan
Legal Team, which interceded for the acquisition of For perspective, Heirs of Morenolater followed
the lots for the Lahug Airports expansion, affirmed by MCIAA v. Tudtud (Tudtud)[26] and the
that persistent assurances were given to the consolidated cases at baris cast under the same
landowners to the effect that as soon as the Lahug factual setting and centered on the expropriation of
Airport is abandoned or transferred to Mactan, the privately-owned lots for the public purpose of
lot owners would be able to reacquire their expanding the Lahug Airport and the alleged
properties.[22] In Civil Case No. CEB-20743, Exhibit promise of reconveyance given by the negotiating
G, the transcript of the deposition of NAC officials to the private lot owners.All the lots
Anunciacion vda. de Ouano covering the assurance being claimed by the former owners or successors-
made had been formally offered in evidence and in-interest of the former owners in the Heirs of
duly considered in the initial decision of Moreno, Tudtud, and the present cases were
the RTC Cebu City. In Civil Case No. CEB-18370, similarly adjudged condemned in favor of the
the trial court, on the basis of testimonial evidence, Republic in Civil Case No. R-1881. All the
and later the CA, recognized the reversionary claimants sought was or is to have the condemned
rights of the suing former lot owners or their lots reconveyed to them upon the payment of the
successors in interest and resolved the case condemnation price since the public purpose of
accordingly. In point with respect to the the expropriation was never met. Indeed, the
representation and promise of the government to expropriated lots were never used and were, in
return the lots taken should the planned airport fact, abandoned by the expropriating government
expansion do not materialize is what the Court agencies.
said in Heirs of Moreno, thus: In all then, the issues and supporting
This is a difficult case calling
for a difficult but just solution. To arguments presented by both sets of petitioners in
begin with there exists these consolidated cases have already previously
an undeniable historical
narrative that the predecessors of been passed upon, discussed at length, and
respondent MCIAA had suggested to
practically peremptorily resolved in Heirs of
the landowners of the properties
covered by the Lahug Airport Moreno and the November 2008 Tudtud ruling. The
expansion scheme that they could
Ouanos, as petitioners in G.R. No. 168770, and the
repurchase their properties at the
termination of the airports Inocians, as respondents in G.R. No. 168812, are
venue. Some acted on this
assurance and sold their properties; similarly situated as the heirs of Moreno in Heirs of
other landowners held out and Moreno and Benjamin Tudtud in Tudtud. Be that
waited for the exercise of eminent
domain to take its course until as it may, there is no reason why the ratio
finally coming to terms with decidendi in Heirs of Morenoand Tudtud should not
respondents predecessors that they
would not appeal nor block further be made to apply to petitioners Ouanos and
respondents Inocians such that they shall be v. Poncio, et al., quoting Chief Justice Moran,
entitled to recover their or their predecessors explains the rationale behind this rule, thusly:
respective properties under the same manner and
x x x The reason is simple. In
arrangement as the heirs of Moreno and
executory contracts there is a wide
Tudtud. Stare decisis et non quieta movere (to field for fraud because unless they
may be in writing there is no
adhere to precedents, and not to unsettle things palpable evidence of the intention of
which are established).[27] the contracting parties. The statute
has been precisely been enacted to
prevent fraud. x x x However, if a
contract has been totally or partially
Just like in Tudtud and earlier in Heirs of Moreno, performed, the exclusion of parol
MCIAA would foist the theory that the judgment of evidence would promote fraud or bad
faith, for it would enable the
condemnation in Civil Case No. R-1881 was defendant to keep the benefits
without qualification and was unconditional. It already derived by him from the
transaction in litigation, and at the
would, in fact, draw attention to the fallo of the same time, evade the obligations,
expropriation courts decision to prove that there is responsibilities or liabilities
assumed or contracted by him
nothing in the decision indicating that the thereby.[30] (Emphasis in the
government gave assurance or undertook to
reconvey the covered lots in case the Lahug airport
expansion project is aborted. Elaborating on this Analyzing the situation of the cases at bar,
angle, MCIAA argues that the claim of the Ouanos there can be no serious objection to the proposition
and the Inocians regarding the alleged verbal that the agreement package between the
assurance of the NAC negotiating team that they government and the private lot owners was already
can reacquire their landholdings is barred by the partially performed by the government through the
Statute of Frauds. acquisition of the lots for the expansion of the
Lahug airport. The parties, however, failed to
Under the rule on the Statute of Frauds, as accomplish the more important condition in the
expressed in Article 1403 of the Civil Code, a CFI decision decreeing the expropriation of the lots
contract for the sale or acquisition of real property litigated upon: the expansion of the Lahug Airport.
shall be unenforceable unless the same or some The projectthe public purpose behind the forced
note of the contract be in writing and subscribed property takingwas, in fact, never pursued and, as
by the party charged. Subject to defined a consequence, the lots expropriated were
exceptions, evidence of the agreement cannot be abandoned. Be that as it may, the two groups of
received without the writing, or secondary evidence landowners can, in an action to compel MCIAA to
of its contents. make good its oral undertaking to allow
repurchase, adduce parol evidence to prove the
MCIAAs invocation of the Statute of Frauds transaction.
is misplaced primarily because the statute applies
only to executory and not to completed, executed, At any rate, the objection on the
or partially consummated contracts. Carbonnel admissibility of evidence on the basis of the Statute
of Frauds may be waived if not timely raised.
Records tend to support the conclusion that
We went on to state as follows:
MCIAA did not, as the Ouanos and the Inocians
While the trial court in Civil Case
posit, object to the introduction of parol evidence No. R-1881 could have simply
to prove its commitment to allow the former acknowledged the presence of public
purpose for the exercise of eminent
landowners to repurchase their respective domain regardless of the survival of
properties upon the occurrence of certain events. the Lahug Airport, the trial court in
its Decision chose not to do so but
instead prefixed its finding of public
In a bid to deny the lot owners the right to purpose upon its understanding
that Lahug Airport will continue to be
repurchase, MCIAA, citing cases,[31] points to the in operation. Verily, these
dispositive part of the decision in Civil Case R- meaningful statements in the body
of the Decision warrant the
1881 which, as couched, granted the Republic conclusion that the expropriated
absolute title to the parcels of land declared properties would remain to be so
until it was confirmed
expropriated. The MCIAA is correct about the that Lahug Airport was no longer in
operation. This inference further
unconditional tone of the dispositive portion of the
implies two (2) things: (a) after the
decision, but that actuality would not carry the day Lahug Airport ceased its
undertaking as such and the
for the agency. Addressing the matter of the
expropriated lots were not being
otherwise absolute tenor of the CFIs disposition in used for any airport expansion
project, the rights vis--vis the
Civil Case No. R-1881, the Court, in Heirs of expropriated lots x x x as between
Moreno, after taking stock of the ensuing portion of the State and their former owners,
petitioners herein, must be
the body of the CFIs decision, said: equitably adjusted; and (b) the
foregoing unmistakable declarations
As for the public purpose of the in the body of the Decision should
expropriation proceeding, it cannot merge with and become an intrinsic
now be part of the fallo thereof which under
doubted. Although Mactan Airport is the premises is clearly inadequate
being constructed, it does not take since the dispositive portion is not
away the actual usefulness and in accord with the findings as
importance of the LahugAirport: it is contained in the body thereof.[33]
handling the air traffic of both
civilian and military. From it
aircrafts fly to Mindanao and Not to be overlooked of course is what the
Visayas and pass thru it on their Court said in its Resolution disposing of MCIAAs
flights to the North
and Manila. Then, no evidence was motion to reconsider the original ruling in Heirs
adduced to show how soon is
of Moreno. In that resolution, We stated that
the Mactan Airport to be placed in
operation and whether the fallo of the decision in Civil Case R-1881
the Lahug Airport will be closed
should be viewed and understood in connection
immediately thereafter. It is up to
the other departments of the with the entire text, which contemplated a return
Government to determine said
matters. The Court cannot of the property taken if the airport expansion
substitute its judgments for those of project were abandoned. For ease of reference,
the said departments or agencies. In
the absence of such showing, the following is what the Court wrote:
court will presume that
the Lahug Airport will continue to Moreover, we do not
be in operation.[32] (Emphasis subscribe to the [MCIAAs]
supplied.) contention that since the possibility
of the Lahug Airports closure was
land as may be allowed by the character of its title
actually considered by the trial
court, a stipulation on reversion or over the properties. In light of our disposition
repurchase was so material that it
should not have been discounted by in Heirs of Moreno and Tudtud, the statement
the court a quo in its decision in immediately adverted to means that in the event
Civil Case No. R-1881, if, in fact,
there was one. We find it proper to the particular public use for which a parcel of land
cite, once more, this Courts ruling is expropriated is abandoned, the owner shall not
that the fallo of the decision in Civil
Case No. R-1881 must be read in be entitled to recover or repurchase it as a matter
reference to the other portions of the of right, unless such recovery or repurchase is
decision in which it forms a part. A
reading of the Courts judgment expressed in or irresistibly deducible from the
must not be confined to the condemnation judgment. But as has been
dispositive portion alone; rather it
should be meaningfully construed in determined below, the decision in Civil Case No. R-
unanimity with the ratio 1881 enjoined MCIAA, as a condition of approving
decidendi thereof to grasp the true
intent and meaning of a decision.[34] expropriation, to allow recovery or repurchase
upon abandonment of the Lahug airport project. To
borrow from our underlying decision in Heirs of
The Court has, to be sure, taken stock of Fery v.
Moreno, [n]o doubt, the return or repurchase of the
Municipality of Cabanatuan,[35] a case MCIAA cites
condemned properties of petitioners could readily
at every possible turn, where the Court made these
be justified as the manifest legal effect of
consequence of the trial courts underlying
If, for example, land is presumption that Lahug Airport will continue to be
expropriated for a particular
in operation when it granted the complaint for
purpose, with the condition that
when that purpose is ended or eminent domain and the airport discontinued its
abandoned the property shall return
to its former owner, then of course,
when the purpose is terminated or
abandoned, the former owner
reacquires the property so Providing added support to the Ouanos and the
expropriated. x x x If, upon the
contrary, however the decree of Inocians right to repurchase is what in Heirs of
expropriation gives to the entity a Moreno was referred to as constructive trust, one
fee simple title, then, of course, the
land becomes the absolute property that is akin to the implied trust expressed in Art.
of the expropriator x x x and in that 1454 of the Civil Code,[37] the purpose of which is to
case the non-user does not have the
effect of defeating the title acquired prevent unjust enrichment.[38] In the case at bench,
by the expropriation proceedings x x the Ouanos and the Inocians parted with their
respective lots in favor of the MCIAA, the latter
obliging itself to use the realties for the expansion
Fery notwithstanding, MCIAA cannot really of Lahug Airport; failing to keep its end of the
rightfully say that it has absolute title to the lots bargain, MCIAA can be compelled by the former
decreed expropriated in Civil Case No. R-1881. The landowners to reconvey the parcels of land to
correct lesson of Fery is captured by what the them, otherwise, they would be denied the use of
Court said in that case, thus: the government their properties upon a state of affairs that was not
acquires only such rights in expropriated parcels of conceived nor contemplated when the
favor of the municipality, following
expropriation was authorized. In effect, the
American jurisprudence,
government merely held the properties condemned particularly City of Fort Wayne v.
Lake Shore & M.S. RY.
in trust until the proposed public use or purpose Co., McConihay v. Theodore
for which the lots were condemned was actually Wright,and Reichling v. Covington
Lumber Co., all uniformly holding
consummated by the government. Since the that the transfer to a third party of
government failed to perform the obligation that is the expropriated real property,
which necessarily resulted in the
the basis of the transfer of the property, then the abandonment of the particular
lot owners Ouanos and Inocians can demand the public purpose for which the
property was taken, is not a ground
reconveyance of their old properties after the for the recovery of the same by its
payment of the condemnation price. previous owner, the title of the
expropriating agency being one of
fee simple.
Constructive trusts are fictions of equity that
Obviously, Fery was not
courts use as devices to remedy any situation in decided pursuant to our now
sacredly held constitutional right
which the holder of the legal title, MCIAA in this
that private property shall not be
case, may not, in good conscience, retain the taken for public use without just
compensation. It is well settled that
beneficial interest. We add, however, as in Heirs of
the taking of private property by the
Moreno, that the party seeking the aid of equitythe Governments power of eminent
domain is subject to two mandatory
landowners in this instance, in establishing the requirements: (1) that it is for a
trustmust himself do equity in a manner as the particular public purpose; and (2)
that just compensation be paid to
court may deem just and reasonable. the property owner. These
requirements partake of the nature
of implied conditions that should be
The Court, in the recent MCIAA v. Lozada, Sr., complied with to enable the
revisited and abandoned the Fery ruling that the condemnor to keep the property
former owner is not entitled to reversion of the
property even if the public purpose were not More particularly, with
respect to the element of public
pursued and were abandoned, thus: use, the expropriator should
commit to use the property
On this note, we take this pursuant to the purpose stated in
opportunity to revisit our ruling the petition for expropriation
in Fery, which involved an filed, failing which, it should file
expropriation suit commenced upon another petition for the new
parcels of land to be used as a site purpose. If not, it is then
for a public market. Instead of incumbent upon the expropriator
putting up a public market, to return the said property to its
respondent Cabanatuan constructed private owner, if the latter desires
residential houses for lease on the to reacquire the same. Otherwise,
area. Claiming that the municipality the judgment of expropriation
lost its right to the property taken suffers an intrinsic flaw, as it would
since it did not pursue its public lack one indispensable element for
purpose, petitioner Juan Fery, the the proper exercise of the power of
former owner of the lots eminent domain, namely, the
expropriated, sought to recover his particular public purpose for which
properties. However, as he had the property will be
admitted that, in 1915, devoted. Accordingly, the private
respondent Cabanatuan acquired a property owner would be denied due
fee simple title to the lands in process of law, and the judgment
question, judgment was rendered in
would violate the property owners
right to justice, fairness, and equity.
Public use, as an eminent domain concept, has
In light of these premises, we
now expressly hold that the taking now acquired an expansive meaning to include any
of private property, consequent to use that is of usefulness, utility, or advantage, or
the Governments exercise of its
power of eminent domain, is always what is productive of general benefit [of the public].
subject to the condition that the [41]
If the genuine public necessitythe very reason or
property be devoted to the specific
public purpose for which it was condition as it wereallowing, at the first instance,
taken. Corollarily, if this particular the expropriation of a private land ceases or
purpose or intent is not initiated or
not at all pursued, and is disappears, then there is no more cogent point for
peremptorily abandoned, then the the governments retention of the expropriated
former owners, if they so desire,
may seek the reversion of the land. The same legal situation should hold if the
property, subject to the return of the government devotes the property to another public
amount of just compensation
received. In such a case, the use very much different from the original or
exercise of the power of eminent
deviates from the declared purpose to benefit
domain has become improper for
lack of the required factual another private person. It has been said that the
justification.[39] (Emphasis supplied.)
direct use by the state of its power to oblige
landowners to renounce their
Clinging to Fery, specifically the fee simple concept productive possession to another citizen, who will
underpinning it, is no longer compelling, use it predominantly for that citizens own private
considering the ensuing inequity such application gain, is offensive to our laws.[42]
entails. Too, the Court resolved Fery not under the
cover of any of the Philippine Constitutions, each A condemnor should commit to use the
decreeing that private property shall not be taken
property pursuant to the purpose stated in the
for public use without just compensation. The twin
petition for expropriation, failing which it should
elements of just compensation and public purpose
file another petition for the new purpose. If not,
are, by themselves, direct limitations to the
exercise of eminent domain, arguing, in a way, then it behooves the condemnor to return the said

against the notion of fee simple title. The fee does property to its private owner, if the latter so
not vest until payment of just compensation. desires. The government cannot plausibly keep the
In esse, expropriation is forced private property
property it expropriated in any manner it pleases
taking, the landowner being really without a ghost
and, in the process, dishonor the judgment of
of a chance to defeat the case of the expropriating
expropriation. This is not in keeping with the idea
agency. In other words, in expropriation, the
private owner is deprived of property against his of fair play,

will. Withal, the mandatory requirement of due

process ought to be strictly followed, such that the The notion, therefore, that the

state must show, at the minimum, a genuine need, government, via expropriation proceedings,

an exacting public purpose to take private acquires unrestricted ownership over or a fee

property, the purpose to be specifically alleged or simple title to the covered land, is no longer

least reasonably deducible from the complaint. tenable. We suggested as much in Heirs of
Moreno and in Tudtud and more recently Inocians. In the same token, justice and fair play
in Lozada, Sr. Expropriated lands should be also dictate that the Ouanos and Inocian return to
differentiated from a piece of land, ownership of MCIAA what they received as just compensation for
which was absolutely transferred by way of an the expropriation of their respective properties plus
unconditional purchase and sale contract freely legal interest to be computed from default, which
entered by two parties, one without obligation to in this case should run from the time MCIAA
buy and the other without the duty to sell. In that complies with the reconveyance obligation. [43] They
case, the fee simple concept really comes into must likewise pay MCIAA the necessary expenses
play. There is really no occasion to apply the fee it might have incurred in sustaining their
simple concept if the transfer is conditional. The respective lots and the monetary value of its
taking of a private land in expropriation services in managing the lots in question to the
proceedings is always conditioned on its continued extent that they, as private owners, were benefited
devotion to its public purpose. As a necessary thereby.
corollary, once the purpose is terminated or
peremptorily abandoned, then the former owner, if In accordance with Art. 1187 of the Civil
he so desires, may seek its reversion, subject of Code on mutual compensation, MCIAA may keep
course to the return, at the very least, of the just whatever income or fruits it may have obtained
compensation received. from the parcels of land expropriated. In turn, the
To be compelled to renounce dominion over Ouanos and Inocians need not require the
a piece of land is, in itself, an already bitter pill to accounting of interests earned by the amounts
swallow for the owner. But to be asked to sacrifice they received as just compensation.[44]
for the common good and yield ownership to the
government which reneges on its assurance that Following Art. 1189 of the Civil Code
the private property shall be for a public purpose providing that [i]f the thing is improved by its
may be too much. But it would be worse if the nature, or by time, the improvement shall inure
power of eminent domain were deliberately used as to the benefit of the creditor x x x, the Ouanos
a subterfuge to benefit another with influence and and Inocians do not have to settle the appreciation
power in the political process, including of the values of their respective lots as part of the
development firms. The mischief thus depicted is reconveyance process, since the value increase is
not at all far-fetched with the continued merely the natural effect of nature and time.
application of Fery. Even as the Court deliberates
on these consolidated cases, there is an Finally, We delete the award of PhP 50,000
uncontroverted allegation that the MCIAA is poised and PhP 10,000, as attorneys fees and litigation
to sell, if it has not yet sold, the areas in question expenses, respectively, made in favor of the
to Cebu Property Ventures, Inc. This provides an Inocians by the Cebu City RTC in its judgment in
added dimension to abandon Fery. Civil Case No. CEB-18370, as later affirmed by the
CA. As a matter of sound policy, no premium
Given the foregoing disquisitions, equity should be set on the right to litigate where there is
and justice demand the reconveyance by MCIAA of no doubt about the bona fides of the exercise of
the litigated lands in question to the Ouanos and such right,[45] as here, albeit the decision of MCIAA
to resist the former landowners claim eventually consolidated petitions, when appropriate, as
turned out to be untenable. follows:

WHEREFORE, the petition in G.R. No.

(1) Petitioners Ouano, et al. in G.R. No.
168770 is GRANTED. Accordingly, the CA
168770 and respondents Ricardo L Inocian, et al.
Decision dated September 3, 2004 in CA-G.R. CV
in G.R. No. 168812 are ordered to return to the
No. 78027 is REVERSED and SET ASIDE.
MCIAA the just compensation they or their
Mactan-Cebu International Airport Authority is
predecessors-in-interest received for the
ordered to reconvey subject Lot No. 763-A to
expropriation of their respective lots as stated in
petitioners Anunciacion vda. de Ouano, Mario P.
Civil Case No. R-1881, within a period of sixty (60)
Ouano, Leticia Ouano Arnaiz, and Cielo Ouano
days from finality of judgment;
Martinez. The Register of Deeds of Cebu City is
ordered to effect the necessary cancellation of title
(2) The MCIAA shall be entitled
and transfer it in the name of the petitioners
to RETAIN whatever fruits and income it may have
within fifteen (15) days from finality of judgment.
obtained from the subject expropriated lots without
The petition of the Mactan-Cebu
any obligation to refund the same to the lot
International Airport Authority in G.R. No.
owners; and
168812 is DENIED, and the CAs Decision and
Resolution dated January 14, 2005 and June 29,
2005, respectively, in CA-G.R. CV No. 64356 (3) Petitioners Ouano, et al. in G.R. No.
are AFFIRMED, except insofar as they awarded 168770 and respondents Ricardo L. Inocian, et al.
attorneys fees and litigation expenses that are in G.R. No. 168812 shall RETAIN whatever
hereby DELETED. Accordingly, Mactan-Cebu interests the amounts they received as just
International Airport Authority is ordered to compensation may have earned in the meantime
reconvey to respondents Ricardo L. Inocian, without any obligation to refund the same to
Olympia E. Esteves, Emilia E. Bacalla, Restituta E. MCIAA.
Montana, and Raul L. Inocian the litigated Lot Nos. SO ORDERED.
744-A, 745-A, 746, 762-A, 747, and 761-A; and to
GR# 176625
respondents Aletha Suico Magat, Philip M. Suico,
#7 Case
Dolores S. dela Cruz, James M. Suico, Edward M.
Suico, Roselyn S. Lawsin, Rex M. Suico, and
Kharla Suico-Gutierrez the litigated Lot Nos. 942 NACHURA, J.:
and 947. The Register of Deeds of Cebu City is
This is a petition for review on certiorari under Rule
ordered to effect the necessary cancellation of title
45 of the Rules of Court, seeking to reverse, annul,
and transfer it in the name of respondents within a
and set aside the Decision[1] dated February 28,
period of fifteen (15) days from finality of judgment.
2006 and the Resolution[2] dated February 7, 2007
of the Court of Appeals (CA) (Cebu City), Twentieth
The foregoing dispositions are subject
Division, in CA-G.R. CV No. 65796.
to QUALIFICATIONS, to apply to these
The antecedent facts and proceedings are as proposed a compromise settlement whereby the
follows: owners of the lots affected by the expropriation
proceedings would either not appeal or withdraw
Subject of this case is Lot No. 88-SWO-25042 (Lot their respective appeals in consideration of a
No. 88), with an area of 1,017 square meters, more commitment that the expropriated lots would be
or less, located in Lahug, Cebu City. Its original resold at the price they were expropriated in the
owner was Anastacio Deiparine when the same event that the ATO would abandon the Lahug
was subject to expropriation proceedings, initiated Airport, pursuant to an established policy involving
by the Republic of the Philippines (Republic), similar cases. Because of this promise, Lozada did
represented by the then Civil Aeronautics not pursue his appeal. Thereafter, Lot No. 88 was
Administration (CAA), for the expansion and transferred and registered in the name of the
improvement of the Lahug Airport. The case was Republic under TCT No. 25057.
filed with the then Court of First Instance of Cebu,
Third Branch, and docketed as Civil Case No. R- The projected improvement and expansion plan of
1881. the old Lahug Airport, however, was not pursued.

As early as 1947, the lots were already occupied by Lozada, with the other landowners, contacted then
the U.S. Army. They were turned over to the CAA Director Vicente Rivera, Jr., requesting to
Surplus Property Commission, the Bureau of repurchase the lots, as per previous
Aeronautics, the National Airport Corporation and agreement. The CAA replied that there might still
then to the CAA. be a need for the Lahug Airport to be used as an
emergency DC-3 airport. It reiterated, however, the
During the pendency of the expropriation assurance that should this Office dispose and
proceedings, respondent Bernardo L. Lozada, Sr. resell the properties which may be found to be no
acquired Lot No. 88 from Deiparine. Consequently, longer necessary as an airport, then the policy of
Transfer Certificate of Title (TCT) No. 9045 was this Office is to give priority to the former owners
issued in Lozadas name. subject to the approval of the President.

On December 29, 1961, the trial court rendered On November 29, 1989, then President Corazon C.
judgment in favor of the Republic and ordered the Aquino issued a Memorandum to the Department
latter to pay Lozada the fair market value of Lot of Transportation, directing the transfer of general
No. 88, adjudged at P3.00 per square meter, with aviation operations of the LahugAirport to
consequential damages by way of legal interest the Mactan International Airport before the end of
computed from November 16, 1947the time when 1990 and, upon such transfer, the closure of
the lot was first occupied by the airport. Lozada the Lahug Airport.
received the amount of P3,018.00 by way of
payment. Sometime in 1990, the Congress of the Philippines
passed Republic Act (R.A.) No. 6958, entitled An
The affected landowners appealed. Pending appeal, Act Creating the Mactan-Cebu International
the Air Transportation Office (ATO), formerly CAA, Airport Authority, Transferring Existing Assets of
(d) During the pendency of the
the Mactan International Airport and the Lahug
appeal, the parties entered into
Airport to the Authority, Vesting the Authority with a compromise settlement to
the effect that the subject
Power to Administer and Operate the Mactan property would be resold to the
International Airport and the Lahug Airport, and original owner at the same
price when it was expropriated
For Other Purposes. in the event that the
Government abandons
the Lahug Airport;
From the date of the institution of the
expropriation proceedings up to the present, the (e) Title to Lot No. 88 was
subsequently transferred to
public purpose of the said expropriation (expansion the Republic of
of the airport) was never actually initiated, realized, the Philippines (TCT No.
or implemented. Instead, the old airport was
converted into a commercial complex. Lot No. 88 (f) The projected expansion and
improvement of
became the site of a jail known as Bagong Buhay the Lahug Airport did not
Rehabilitation Complex, while a portion thereof was
occupied by squatters.[3] The old airport was (g) Plaintiffs sought to repurchase
their property from then CAA
converted into what is now known as
Director Vicente Rivera. The
the Ayala I.T. Park, a commercial area. latter replied by giving as
assurance that priority would
be given to the previous
Thus, on June 4, 1996, petitioners initiated a owners, subject to the
approval of the President,
complaint for the recovery of possession and should CAA decide to dispose
reconveyance of ownership of Lot No. 88. The case of the properties;

was docketed as Civil Case No. CEB-18823 and (h) On November 29, 1989, then
was raffled to the Regional Trial Court (RTC), President Corazon C. Aquino,
through a Memorandum to the
Branch 57, Cebu City. The complaint substantially Department of Transportation
alleged as follows: and Communications (DOTC),
directed the transfer of general
aviation operations at
(a) Spouses Bernardo and Rosario the Lahug Airport to the
Lozada were the registered Mactan-Cebu International
owners of Lot No. 88 covered Airport Authority;
by TCT No. 9045;
(i) Since the public purpose for the
(b) In the early 1960s, the Republic expropriation no longer exists,
sought to acquire by the property must be returned
expropriation Lot No. 88, to the plaintiffs.[4]
among others, in connection
with its program for the
improvement and expansion of
the Lahug Airport; In their Answer, petitioners asked for the
immediate dismissal of the complaint. They
(c) A decision was rendered by the
Court of First Instance in favor specifically denied that the Government had made
of the Government and against assurances to reconvey Lot No. 88 to respondents
the land owners, among whom
was Bernardo Lozada, Sr. in the event that the property would no longer be
appealed therefrom; needed for airport operations. Petitioners instead
asserted that the judgment of condemnation was
unconditional, and respondents were, therefore, On October 22, 1999, the RTC rendered its
not entitled to recover the expropriated property Decision, disposing as follows:
notwithstanding non-use or abandonment thereof.
WHEREFORE, in the light of the
foregoing, the Court hereby renders
After pretrial, but before trial on the merits, the judgment in favor of the plaintiffs,
Bernardo L. Lozada, Sr., and the
parties stipulated on the following set of facts: heirs of Rosario Mercado, namely,
Vicente M. Lozada, Marcia L.
(1) The lot involved is Lot No. 88- Godinez, Virginia L. Flores,
SWO-25042 of the Banilad Bernardo M. Lozada, Jr., Dolores L.
Estate, situated in the City Gacasan, Socorro L. Cafaro and
of Cebu, containing an area of Rosario M. Lozada, represented by
One Thousand Seventeen their attorney-in-fact Marcia Lozada
(1,017) square meters, more or Godinez, and against defendants
less; Cebu-Mactan International Airport
Authority (MCIAA) and Air
(2) The property was expropriated Transportation Office (ATO):
among several other properties
in Lahug in favor of the 1. ordering MCIAA and ATO
Republic of the Philippines by to restore to plaintiffs the
virtue of a Decision dated possession and ownership of their
December 29, 1961 of the CFI land, Lot No. 88 Psd-821 (SWO-
of Cebu in Civil Case No. R- 23803), upon payment of the
1881; expropriation price to plaintiffs; and

(3) The public purpose for which the 2. ordering the Register of
property was expropriated was Deeds to effect the transfer of the
for the purpose of Certificate of Title from defendant[s]
the Lahug Airport; to plaintiffs on Lot No. [88],
cancelling TCT No. 20357 in the
(4) After the expansion, the property name of defendant MCIAA and to
was transferred in the name of issue a new title on the same lot in
MCIAA; [and] the name of Bernardo L. Lozada, Sr.
and the heirs of Rosario Mercado,
(5) On November 29, 1989, then namely: Vicente M. Lozada, Mario
President Corazon C. Aquino M. Lozada, Marcia L. Godinez,
directed the Department of Virginia L. Flores, Bernardo M.
Transportation and Lozada, Jr., Dolores L. Gacasan,
Communication to transfer Socorro L. Cafaro and Rosario M.
general aviation operations of Lozada.
the Lahug Airport to the
Mactan-Cebu International No pronouncement as to costs.
Airport Authority and to close
the Lahug Airport after such SO ORDERED.[6]

Aggrieved, petitioners interposed an appeal to the

During trial, respondents presented Bernardo CA. After the filing of the necessary appellate
Lozada, Sr. as their lone witness, while petitioners briefs, the CA rendered its assailed Decision dated
presented their own witness, Mactan-Cebu February 28, 2006, denying petitioners appeal and
International Airport Authority legal assistant affirming in toto the Decision of the RTC, Branch
Michael Bacarisas. 57, Cebu City. Petitioners motion for
reconsideration was, likewise, denied in the
questioned CA Resolution dated February 7, 2007.
expropriation gives to the entity a
fee simple title, then, of course, the
Hence, this petition arguing that: (1) the land becomes the absolute property
of the expropriator, whether it be
respondents utterly failed to prove that there was a the State, a province, or
repurchase agreement or compromise settlement municipality, and in that case the
non-user does not have the effect of
between them and the Government; (2) the defeating the title acquired by the
judgment in Civil Case No. R-1881 was absolute expropriation proceedings. x x x.

and unconditional, giving title in fee simple to the When land has been
Republic; and (3) the respondents claim of verbal acquired for public use in fee
simple, unconditionally, either by the
assurances from government officials violates the exercise of eminent domain or by
Statute of Frauds. purchase, the former owner retains
no right in the land, and the public
use may be abandoned, or the land
The petition should be denied. may be devoted to a different use,
without any impairment of the
estate or title acquired, or any
reversion to the former owner. x x x.
Petitioners anchor their claim to the controverted [8]

property on the supposition that the Decision in

the pertinent expropriation proceedings did not
Contrary to the stance of petitioners, this
provide for the condition that should the intended
Court had ruled otherwise in Heirs of Timoteo
use of Lot No. 88 for the expansion of
Moreno and Maria Rotea v. Mactan-Cebu
the Lahug Airport be aborted or abandoned, the
International Airport Authority, thus
property would revert to respondents, being its
former owners. Petitioners cite, in support of this
Moreover, respondent MCIAA has
position, Fery v. Municipality of Cabanatuan, brought to our attention a
significant and telling portion in
which declared that the Government acquires the Decision in Civil Case No. R-
only such rights in expropriated parcels of land as 1881 validating our discernment
that the expropriation by the
may be allowed by the character of its title over the predecessors of respondent was
properties ordered under the running
that Lahug Airport would continue
If x x x land is expropriated for a in operation
particular purpose, with the
condition that when that purpose is As for the public
ended or abandoned the property purpose of the
shall return to its former owner, expropriation
then, of course, when the purpose is proceeding, it cannot
terminated or abandoned the former now be
owner reacquires the property so doubted. Although M
expropriated. If x x x land is actan Airport is being
expropriated for a public street and constructed, it does
the expropriation is granted upon not take away the
condition that the city can only use actual usefulness and
it for a public street, then, of course, importance of
when the city abandons its use as a the Lahug Airport: it
public street, it returns to the is handling the air
former owner, unless there is some traffic both civilian
statutory provision to the and military. From it
contrary. x x x. If, upon the aircrafts fly to
contrary, however, the decree of Mindanao and
Visayas and pass become an intrinsic part of
thru it on their flights the fallo thereof which under the
to the North premises is clearly inadequate since
and Manila.Then, no the dispositive portion is not in
evidence was accord with the findings as
adduced to show how contained in the body thereof.[10]
soon is
the Mactan Airport to
be placed in operation
Indeed, the Decision in Civil Case No. R-1881
and whether
the Lahug Airport will should be read in its entirety, wherein it is
be closed immediately
thereafter. It is up to apparent that the acquisition by the Republic of
the other the expropriated lots was subject to the condition
departments of the
Government to that the Lahug Airport would continue its
determine said operation. The condition not having materialized
matters. The Court
cannot substitute its because the airport had been abandoned, the
judgment for those of former owner should then be allowed to reacquire
the said departments
or agencies. In the the expropriated property.[11]
absence of such
showing, the Court
will presume that On this note, we take this opportunity to revisit
the Lahug Airport will our ruling in Fery, which involved an expropriation
continue to be in
operation (emphasis suit commenced upon parcels of land to be used as
a site for a public market. Instead of putting up a
While in the trial in Civil Case No. public market,
R-1881 [we] could have simply
respondent Cabanatuan constructed residential
acknowledged the presence of public
purpose for the exercise of eminent houses for lease on the area. Claiming that the
domain regardless of the survival
municipality lost its right to the property taken
of Lahug Airport, the trial court in
its Decision chose not to do so but since it did not pursue its public purpose,
instead prefixed its finding of public
purpose upon its understanding petitioner Juan Fery, the former owner of the lots
that Lahug Airport will continue to be expropriated, sought to recover his
in operation. Verily, these
meaningful statements in the body properties. However, as he had admitted that, in
of the Decision warrant the 1915, respondent Cabanatuan acquired a fee
conclusion that the expropriated
properties would remain to be so simple title to the lands in question, judgment was
until it was confirmed rendered in favor of the municipality, following
that Lahug Airport was no longer in
operation. This inference further American jurisprudence, particularly City of Fort
implies two (2) things: (a) after Wayne v. Lake Shore & M.S. RY. Co.,[12] McConihay
the Lahug Airport ceased its
undertaking as such and the v. Theodore Wright,[13] and Reichling v. Covington
expropriated lots were not being Lumber Co.,[14] all uniformly holding that the
used for any airport expansion
project, the rights vis--vis the transfer to a third party of the expropriated real
expropriated Lots Nos. 916 and 920
property, which necessarily resulted in the
as between the State and their
former owners, petitioners herein, abandonment of the particular public purpose for
must be equitably adjusted; and (b)
which the property was taken, is not a ground for
the foregoing unmistakable
declarations in the body of the recovery of the same by its previous owner, the
the Decision should merge with and
title of the expropriating agency being one of fee for which it was taken. Corollarily, if this particular
simple. purpose or intent is not initiated or not at all
pursued, and is peremptorily abandoned, then the
Obviously, Fery was not decided pursuant to our former owners, if they so desire, may seek the
now sacredly held constitutional right that private reversion of the property, subject to the return of
property shall not be taken for public use without the amount of just compensation received. In such
just compensation. It is well settled that the a case, the exercise of the power of eminent
taking of private property by the Governments domain has become improper for lack of the
power of eminent domain is subject to two required factual justification.[17]
mandatory requirements: (1) that it is for a
particular public purpose; and (2) that just Even without the foregoing declaration, in the
compensation be paid to the property owner. These instant case, on the question of whether
requirements partake of the nature of implied respondents were able to establish the existence of
conditions that should be complied with to enable an oral compromise agreement that entitled them
the condemnor to keep the property expropriated. to repurchase Lot No. 88 should the operations of
the Lahug Airport be abandoned, we rule in the
More particularly, with respect to the element of
public use, the expropriator should commit to use It bears stressing that both the RTC, Branch 57,
the property pursuant to the purpose stated in the Cebu and the CA have passed upon this factual
petition for expropriation filed, failing which, it issue and have declared, in no uncertain terms,
should file another petition for the new purpose. If that a compromise agreement was, in fact, entered
not, it is then incumbent upon the expropriator to into between the Government and respondents,
return the said property to its private owner, if the with the former undertaking to resell Lot No. 88 to
latter desires to reacquire the same. Otherwise, the the latter if the improvement and expansion of the
judgment of expropriation suffers an intrinsic flaw, Lahug Airport would not be pursued. In affirming
as it would lack one indispensable element for the the factual finding of the RTC to this effect, the CA
proper exercise of the power of eminent domain, declared
namely, the particular public purpose for which
Lozadas testimony is cogent. An
the property will be devoted. Accordingly, the
octogenarian widower-retiree and a
private property owner would be denied due resident of Moon
Park, California since 1974, he
process of law, and the judgment would violate the testified that government
property owners right to justice, fairness, and representatives verbally promised
him and his late wife while the
equity. expropriation proceedings were on-
going that the government shall
return the property if the purpose
In light of these premises, we now expressly hold for the expropriation no longer
that the taking of private property, consequent to exists. This promise was made at
the premises of the airport.As far as
the Governments exercise of its power of eminent he could remember, there were no
domain, is always subject to the condition that the expropriation proceedings against
his property in 1952 because the
property be devoted to the specific public purpose
first notice of expropriation he
received was in 1962. Based on the
promise, he did not hire a Verily, factual findings of the trial court,
lawyer. Lozada was firm that he was
promised that the lot would be especially when affirmed by the CA, are binding
reverted to him once the public use and conclusive on this Court and may not be
of the lot ceases. He made it clear
that the verbal promise was made in reviewed. A petition for certiorari under Rule 45 of
Lahug with other lot owners before the Rules of Court contemplates only questions of
the 1961 decision was handed
down, though he could not name law and not of fact.[21] Not one of the exceptions to
the government representatives who this rule is present in this case to warrant a
made the promise. It was just a
verbal promise; nevertheless, it is reversal of such findings.
binding. The fact that he could not
supply the necessary details for the
establishment of his assertions As regards the position of petitioners that
during cross-examination, but that respondents testimonial evidence violates the
When it will not be used as
intended, it will be returned back, Statute of Frauds, suffice it to state that the
we just believed in the government,
Statute of Frauds operates only with respect to
does not dismantle the credibility
and truthfulness of his executory contracts, and does not apply to
allegation. This Court notes that he
contracts which have been completely or partially
was 89 years old when he testified
in November 1997 for an incident performed, the rationale thereof being as follows:
which happened decades ago. Still,
he is a competent witness capable of
In executory contracts there is a wide field
perceiving and making his
for fraud because unless they be in writing
perception known. The minor lapses
there is no palpable evidence of the
are immaterial. The decision of the
intention of the contracting parties. The
competency of a witness rests
statute has precisely been enacted to
primarily with the trial judge and
prevent fraud. However, if a contract has
must not be disturbed on appeal
been totally or partially performed, the
unless it is clear that it was
exclusion of parol evidence would promote
erroneous. The objection to his
fraud or bad faith, for it would enable the
competency must be made before he
defendant to keep the benefits already
has given any testimony or as soon
delivered by him from the transaction in
as the incompetency becomes
litigation, and, at the same time, evade the
apparent. Though Lozada is not part
obligations, responsibilities or liabilities
of the compromise agreement,[18] he
assumed or contracted by him thereby.[22]
nevertheless adduced sufficient
evidence to support his claim.[19]

In this case, the Statute of Frauds, invoked by

As correctly found by the CA, unlike in Mactan petitioners to bar the claim of respondents for the
Cebu International Airport Authority v. Court of reacquisition of Lot No. 88, cannot apply, the oral
Appeals,[20] cited by petitioners, where respondent compromise settlement having been partially
therein offered testimonies which were hearsay in performed. By reason of such assurance made in
nature, the testimony of Lozada was based on their favor, respondents relied on the same by not
personal knowledge as the assurance from the pursuing their appeal before the CA. Moreover,
government was personally made to him. His contrary to the claim of petitioners, the fact of
testimony on cross-examination destroyed neither Lozadas eventual conformity to the appraisal of Lot
his credibility as a witness nor the truthfulness of No. 88 and his seeking the correction of a clerical
his words. error in the judgment as to the true area of Lot No.
compelled by petitioners to reconvey the
88 do not conclusively establish that respondents
parcels of land to them, otherwise,
absolutely parted with their property. To our mind, petitioners would be denied the use of their
properties upon a state of affairs that was
these acts were simply meant to cooperate with the not conceived nor contemplated when the
government, particularly because of the oral expropriation was authorized.
promise made to them. Although the symmetry between the instant
case and the situation contemplated by Art.
1454 is not perfect, the provision is
The right of respondents to repurchase Lot No. 88 undoubtedly applicable. For, as explained
may be enforced based on a constructive trust by an expert on the law of trusts: The only
problem of great importance in the field of
constituted on the property held by the constructive trust is to decide whether in the
government in favor of the former. On this note, numerous and varying fact situations
presented to the courts there is a wrongful
our ruling in Heirs of Timoteo Moreno is holding of property and hence a threatened
instructive, viz.: unjust enrichment of the
defendant. Constructive trusts are fictions
of equity which are bound by no unyielding
Mactan-Cebu International Airport formula when they are used by courts as
Authority is correct in stating that one devices to remedy any situation in which
would not find an express statement in the the holder of legal title may not in good
Decision in Civil Case No. R-1881 to the conscience retain the beneficial interest.
effect that the [condemned] lot would return
to [the landowner] or that [the landowner] In constructive trusts, the arrangement is
had a right to repurchase the same if the temporary and passive in which the
purpose for which it was expropriated is trustees sole duty is to transfer the title and
ended or abandoned or if the property was possession over the property to the
to be used other than as the Lahug plaintiff-beneficiary. Of course,
Airport. This omission notwithstanding, and the wronged party seeking the aid of a court
while the inclusion of this pronouncement of equity in establishing a constructive trust
in the judgment of condemnation would must himself do equity. Accordingly, the
have been ideal, such precision is not court will exercise its discretion in deciding
absolutely necessary nor is it fatal to the what acts are required of the plaintiff-
cause of petitioners herein. No doubt, the beneficiary as conditions precedent to
return or repurchase of the condemned obtaining such decree and has the
properties of petitioners could be readily obligation to reimburse the trustee the
justified as the manifest legal effect or consideration received from the latter just
consequence of the trial courts underlying as the plaintiff-beneficiary would if he
presumption that Lahug Airport will proceeded on the theory of rescission. In
continue to be in operation when it granted the good judgment of the court, the trustee
the complaint for eminent domain and the may also be paid the necessary expenses he
airport discontinued its activities. may have incurred in sustaining the
property, his fixed costs for improvements
The predicament of petitioners involves a thereon, and the monetary value of his
constructive trust, one that is akin to the services in managing the property to the
implied trust referred to in Art. 1454 of extent that plaintiff-beneficiary will secure a
the Civil Code, If an absolute conveyance of benefit from his acts.
property is made in order to secure the
performance of an obligation of the grantor The rights and obligations between the
toward the grantee, a trust by virtue of law constructive trustee and the beneficiary, in
is established. If the fulfillment of the this case, respondent MCIAA and
obligation is offered by the grantor when it petitioners over Lots Nos. 916 and 920, are
becomes due, he may demand the echoed in Art. 1190 of the Civil Code, When
reconveyance of the property to him. In the the conditions have for their purpose the
case at bar, petitioners conveyed Lots No. extinguishment of an obligation to give, the
916 and 920 to the government with the parties, upon the fulfillment of said
latter obliging itself to use the realties for conditions, shall return to each other what
the expansion of Lahug Airport; failing to they have received x x x In case of the loss,
keep its bargain, the government can be deterioration or improvement of the thing,
the provisions which, with respect to the
and its February 7, 2007 Resolution
debtor, are laid down in the preceding
article shall be applied to the party who is are AFFIRMED with MODIFICATION as follows:
bound to return x x x.[23]

1. Respondents are ORDERED to return to

On the matter of the repurchase price, while petitioners the just compensation they received for
petitioners are obliged to reconvey Lot No. 88 to the expropriation of Lot No. 88, plus legal interest,
respondents, the latter must return to the former in the case of default, to be computed from the
what they received as just compensation for the time petitioners comply with their obligation to
expropriation of the property, plus legal interest to reconvey Lot No. 88 to them;
be computed from default, which in this case runs
from the time petitioners comply with their 2. Respondents are ORDERED to pay petitioners
obligation to respondents. the necessary expenses the latter incurred in
maintaining Lot No. 88, plus the monetary value of
Respondents must likewise pay petitioners the their services to the extent that respondents were
necessary expenses they may have incurred in benefited thereby;
maintaining Lot No. 88, as well as the monetary
value of their services in managing it to the extent 3. Petitioners are ENTITLED to keep
that respondents were benefited thereby. whatever fruits and income they may have
obtained from Lot No. 88; and
Following Article 1187[24] of the Civil Code,
petitioners may keep whatever income or fruits 4. Respondents are also ENTITLED to keep
they may have obtained from Lot No. 88, and whatever interests the amounts they received as
respondents need not account for the interests that just compensation may have earned in the
the amounts they received as just compensation meantime, as well as the appreciation in value of
may have earned in the meantime. Lot No. 88, which is a natural consequence of
nature and time;
In accordance with Article 1190 of the Civil Code
vis--vis Article 1189, which provides that (i)f a In light of the foregoing modifications, the case
thing is improved by its nature, or by time, the is REMANDED to the Regional Trial Court, Branch
improvement shall inure to the benefit of the 57, Cebu City, only for the purpose of receiving
creditor x x x, respondents, as creditors, do not evidence on the amounts that respondents will
have to pay, as part of the process of restitution, have to pay petitioners in accordance with this
the appreciation in value of Lot No. 88, which is a Courts decision. No costs.
natural consequence of nature and time.[26] SO ORDERED.

G.R. No. 165828 August 24, 2011

WHEREFORE, the petition is DENIED. The
February 28, 2006 Decision of the Court of NATIONAL POWER CORPORATION, Petitioner,
Appeals, affirming the October 22, 1999 Decision HEIRS OF MACABANGKIT SANGKAY, namely:
of the Regional Trial Court, Branch 87, Cebu City, CEBU, BATOWA-AN, SAYANA, NASSER, MANTA,
EDGAR, PUTRI , MONGKOY*, and AMIR, all into a housing project for the same reason; that Al-
surnamed MACABANGKIT, Respondents. Amanah Islamic Investment Bank of the
Philippines had also refused to accept their land as
DECISION collateral because of the presence of the
underground tunnel; that the underground tunnel
BERSAMIN, J.: had been constructed without their knowledge and
consent; that the presence of the tunnel deprived
them of the agricultural, commercial, industrial
Private property shall not be taken for public use and residential value of their land; and that their
without just compensation. land had also become an unsafe place for
habitation because of the loud sound of the water
– Section 9, Article III, 1987 Constitution rushing through the tunnel and the constant
shaking of the ground, forcing them and their
The application of this provision of the workers to relocate to safer grounds.
Constitution is the focus of this appeal.
In its answer with counterclaim, 4 NPC countered
Petitioner National Power Corporation (NPC) seeks that the Heirs of Macabangkit had no right to
the review on certiorari of the decision promulgated compensation under section 3(f) of Republic Act
on October 5, 2004,1 whereby the Court of Appeals No. 6395, under which a mere legal easement on
(CA) affirmed the decision dated August 13, 1999 their land was established; that their cause of
and the supplemental decision dated August 18, action, should they be entitled to compensation,
1999, ordering NPC to pay just compensation to already prescribed due to the tunnel having been
the respondents, both rendered by the Regional constructed in 1979; and that by reason of the
Trial Court, Branch 1, in Iligan City (RTC). tunnel being an apparent and continuous
easement, any action arising from such easement
Antecedents prescribed in five years.

Pursuant to its legal mandate under Republic Act Ruling of the RTC
No. 6395 (An Act Revising the Charter of the
National Power Corporation), NPC undertook the On July 23, 1998, an ocular inspection of the land
Agus River Hydroelectric Power Plant Project in the that was conducted by RTC Judge Mamindiara P.
1970s to generate electricity for Mindanao. The Mangotara and the representatives of the parties
project included the construction of several resulted in the following observations and findings:
underground tunnels to be used in diverting the
water flow from the Agus River to the hydroelectric a. That a concrete post which is about two feet in
plants.2 length from the ground which according to the
claimants is the middle point of the tunnel.
On November 21, 1997, the respondents, namely:
Cebu, Bangowa-an, Sayana, Nasser, Manta, Edgar, b. That at least three fruit bearing durian trees
Putri, Mongkoy and Amir, all surnamed were uprooted and as a result of the construction
Macabangkit (Heirs of Macabangkit), as the owners by the defendant of the tunnel and about one
of land with an area of 221,573 square meters hundred coconuts planted died.
situated in Ditucalan, Iligan City, sued NPC in the
RTC for the recovery of damages and of the c. That underground tunnel was constructed
property, with the alternative prayer for the therein.5
payment of just compensation.3 They alleged that
they had belatedly discovered that one of the
underground tunnels of NPC that diverted the After trial, the RTC ruled in favor of the plaintiffs
water flow of the Agus River for the operation of the (Heirs of Macabangkit),6 decreeing:
Hydroelectric Project in Agus V, Agus VI and Agus
VII traversed their land; that their discovery had WHEREFORE, premises considered:
occurred in 1995 after Atty. Saidali C. Gandamra,
President of the Federation of Arabic Madaris 1. The prayer for the removal or dismantling of
School, had rejected their offer to sell the land defendant’s tunnel is denied. However, defendant
because of the danger the underground tunnel is hereby directed and ordered:
might pose to the proposed Arabic Language
Training Center and Muslims Skills Development a)To pay plaintiffs’ land with a total area of
Center; that such rejection had been followed by 227,065 square meters, at the rate of FIVE
the withdrawal by Global Asia Management and HUNDRED (₱500.00) PESOS per square meter, or
Resource Corporation from developing the land a total of ONE HUNDRED THIRTEEN MILLION
FIVE HUNDRED THIRTY TWO THOUSAND AND Power Corporation, upon payment of the aforesaid
FIVE HUNDRED (₱113,532,500.00), PESOS, plus sum."
interest, as actual damages or just compensation;
Therefore, paragraph 1(a) of the dispositive portion
b) To pay plaintiff a monthly rental of their land in of the original decision should read, as follows:
the amount of THIRTY THOUSAND (₱30,000.00)
PESOS from 1979 up to July 1999 with 12% a) To pay plaintiffs’ land with a total area of
interest per annum; 227,065 square meters, at the rate of FIVE
HUNDRED (₱500.00) PESOS per square meter, or
c)To pay plaintiffs the sum of TWO HUNDRED a total of ONE HUNDRED THIRTEEN MILLION
damages; FIVE HUNDRED (₱113,532,500.00) PESOS, plus
interest, as actual damages or just
d) To pay plaintiffs, the sum of TWO HUNDRED compensation; Consequently, plaintiffs’ land or
THOUSAND (₱200,000.00) PESOS, as exemplary properties are hereby condemned in favor of
damages; defendant National Power Corporation, upon
payment of the aforesaid sum;
e)To pay plaintiffs, the sum equivalent to 15% of
the total amount awarded, as attorney’s fees, and This supplemental decision shall be considered as
to pay the cost. part of paragraph 1(a) of the dispositive portion of
the original decision.
Furnish copy of this supplemental decision to all
The RTC found that NPC had concealed the parties immediately.
construction of the tunnel in 1979 from the Heirs
of Macabangkit, and had since continuously SO ORDERED.
denied its existence; that NPC had acted in bad
faith by taking possession of the subterranean On its part, NPC appealed to the CA on August 25,
portion of their land to construct the tunnel 1999.8
without their knowledge and prior consent; that
the existence of the tunnel had affected the entire Earlier, on August 18, 1999, the Heirs of
expanse of the land, and had restricted their right Macabangkit filed an urgent motion for execution
to excavate or to construct a motorized deep well; of judgment pending appeal.9 The RTC granted the
and that they, as owners, had lost the agricultural, motion and issued a writ of execution, 10 prompting
commercial, industrial and residential value of the NPC to assail the writ by petition for certiorari in
land. the CA. On September 15, 1999, the CA issued a
temporary restraining order (TRO) to enjoin the
The RTC fixed the just compensation at RTC from implementing its decision. The Heirs of
₱500.00/square meter based on the testimony of Macabangkit elevated the ruling of the CA (G.R.
Dionisio Banawan, OIC-City Assessor of Iligan No. 141447), but the Court upheld the CA on May
City, to the effect that the appraised value of the 4, 2006.11
adjoining properties ranged from ₱700.00 to
₱750.00, while the appraised value of their affected Ruling of the CA
land ranged from ₱400.00 to ₱500.00. The RTC
also required NPC to pay rentals from 1979 due to NPC raised only two errors in the CA, namely:
its bad faith in concealing the construction of the
tunnel from the Heirs of Macabangkit.
On August 18, 1999, the RTC issued a
supplemental decision,7 viz:
Upon a careful review of the original decision dated PLANT PROJECT TRAVERSED AND/OR
August 13, 1999, a sentence should be added to AFFECTED APPELLEES’ PROPERTY AS THERE IS
paragraph 1(a) of the dispositive portion thereof, to NO CLEAR EVIDENCE INDUBITABLY
bolster, harmonize, and conform to the findings of ESTABLISHING THE SAME
the Court, which is quoted hereunder, to wit:
"Consequently, plaintiffs’ land or properties are
hereby condemned in favor of defendant National
LACHES NPC reiterates that witnesses Enterone and
Sacedon lacked personal knowledge about the
On October 5, 2004, the CA affirmed the decision construction and existence of the tunnel and were
of the RTC, holding that the testimonies of NPC’s for that reason not entitled to credence; and that
witness Gregorio Enterone and of the respondents’ the topographic and relocation maps prepared by
witness Engr. Pete Sacedon, the topographic Sacedon should not be a basis to prove the
survey map, the sketch map, and the ocular existence and location of the tunnel due to being
inspection report sufficiently established the self-serving.
existence of the underground tunnel traversing the
land of the Heirs of Macabangkit; that NPC did not NPC contends that the CA should have applied
substantiate its defense that prescription already Section 3(i) of Republic Act No. 6395, which
barred the claim of the Heirs of Macabangkit; and provided a period of only five years from the date of
that Section 3(i) of R.A. No. 6395, being silent the construction within which the affected
about tunnels, did not apply, viz: landowner could bring a claim against it; and that
even if Republic Act No. 6395 should be
As regard Section 3(i) of R.A. No. 6395 (An Act inapplicable, the action of the Heirs of
Revising the Charter of the National Power Macabangkit had already prescribed due to the
Corporation), it is submitted that the same underground tunnel being susceptible to
provision is not applicable. There is nothing in acquisitive prescription after the lapse of 10 years
Section 3(i) of said law governing claims involving pursuant to Article 620 of the Civil Code due to its
tunnels. The same provision is applicable to those being a continuous and apparent legal easement
projects or facilities on the surface of the land, that under Article 634 of the Civil Code.
can easily be discovered, without any mention
about the claims involving tunnels, particularly The issues for resolution are, therefore, as follows:
those surreptitiously constructed beneath the
surface of the land, as in the instant case. (1) Whether the CA and the RTC erred in holding
that there was an underground tunnel traversing
Now, while it is true that Republic Act No. 6395 the Heirs of Macabangkit’s land constructed by
authorizes NAPOCOR to take water from any NPC; and
public stream, river, creek, lake, spring or waterfall
in the Philippines for the realization of the (2) Whether the Heirs of Macabangkit’s right to
purposes specified therein for its creation; to claim just compensation had prescribed under
intercept and divert the flow of waters from lands section 3(i) of Republic Act No. 6395, or,
of riparian owners (in this case, the "Heirs"), and alternatively, under Article 620 and Article 646 of
from persons owning or interested in water which the Civil Code.
are or may be necessary to said purposes, the
same Act expressly mandates the payment of just

We uphold the liability of NPC for payment of just

WHEREFORE, premises considered, the instant
appeal is hereby DENIED for lack of merit.
Accordingly, the appealed Decision dated August
13, 1999, and the supplemental Decision dated 1.
August 18, 1999, are hereby AFFIRMED in toto.
Factual findings of the RTC,
SO ORDERED.12 when affirmed by the CA, are binding

Issue The existence of the tunnel underneath the land of

the Heirs of Macabangkit, being a factual matter,
cannot now be properly reviewed by the Court, for
NPC has come to the Court, assigning the lone
questions of fact are beyond the pale of a petition
error that:
for review on certiorari. Moreover, the factual
findings and determinations by the RTC as the trial
court are generally binding on the Court, of the power cavern, and of the inlet and outlet
particularly after the CA affirmed them.13 Bearing channels adverted to and as depicted in the
these doctrines in mind, the Court should rightly topographic survey map and the sketch map. The
dismiss NPC’s appeal. CA cannot be faulted for crediting the testimony of
Sacedon despite the effort of NPC to discount his
NPC argues, however, that this appeal should not credit due to his not being an expert witness,
be dismissed because the Heirs of Macabangkit simply because Sacedon had personal knowledge
essentially failed to prove the existence of the based on his being NPC’s principal engineer and
underground tunnel. It insists that the topographic supervisor tasked at one time to lay out the
survey map and the right-of-way map presented by tunnels and transmission lines specifically for the
the Heirs of Macabangkit did not at all establish hydroelectric projects,16 and to supervise the
the presence of any underground tunnel. construction of the Agus 1 Hydroelectric Plant
itself17 from 1978 until his retirement from
NPC still fails to convince. NPC.18 Besides, he declared that he personally
experienced the vibrations caused by the rushing
currents in the tunnel, particularly near the outlet
Even assuming, for now, that the Court may review channel.19 Under any circumstances, Sacedon was
the factual findings of the CA and the RTC, for NPC a credible and competent witness.
to insist that the evidence on the existence of the
tunnel was not adequate and incompetent remains
futile. On the contrary, the evidence on the tunnel The ocular inspection actually confirmed the
was substantial, for the significance of the existence of the tunnel underneath the land of the
topographic survey map and the sketch map (as Heirs of Macabangkit. Thus, the CA observed:
indicative of the extent and presence of the tunnel
construction) to the question on the existence of More so, the Ocular inspection conducted on July
the tunnel was strong, as the CA correctly 23, 1998 further bolstered such claim of the
projected in its assailed decision, viz: existence and extent of such tunnel. This was
conducted by a team composed of the Honorable
Among the pieces of documentary evidence Presiding Judge of the Regional Trial Court,
presented showing the existence of the said tunnel Branch 01, Lanao del Norte, herself and the
beneath the subject property is the topographic respective lawyers of both of the parties and found
survey map. The topographic survey map is one that, among others, said underground tunnel was
conducted to know about the location and constructed beneath the subject property.20
elevation of the land and all existing structures
above and underneath it. Another is the Sketch It bears noting that NPC did not raise any issue
Map which shows the location and extent of the against or tender any contrary comment on the
land traversed or affected by the said tunnel. These ocular inspection report.
two (2) pieces of documentary evidence readily
point the extent and presence of the tunnel 2.
construction coming from the power cavern near
the small man-made lake which is the inlet and Five-year prescriptive period under Section 3(i) of
approach tunnel, or at a distance of about two (2) Republic Act No. 6395 does not apply to claims for
kilometers away from the land of the plaintiffs- just compensation
appellees, and then traversing the entire and the
whole length of the plaintiffs-appellees’ property, The CA held that Section 3(i) of Republic Act No.
and the outlet channel of the tunnel is another 6395 had no application to this action because it
small man-made lake. This is a sub-terrain covered facilities that could be easily discovered,
construction, and considering that both inlet and not tunnels that were inconspicuously constructed
outlet are bodies of water, the tunnel can hardly be beneath the surface of the land.21
noticed. All constructions done were beneath the
surface of the plaintiffs-appellees’ property. This
NPC disagrees, and argues that because Article
explains why they could never obtain any
63522 of the Civil Code directs the application of
knowledge of the existence of such tunnel during
special laws when an easement, such as the
the period that the same was constructed and
underground tunnel, was intended for public use,
installed beneath their property.14
the law applicable was Section 3(i) of Republic Act
No. 6395, as amended, which limits the action for
The power cavern and the inlet and outlet channels recovery of compensation to five years from the
established the presence of the underground date of construction. It posits that the five-year
tunnel, based on the declaration in the RTC by prescriptive period already set in due to the
Sacedon, a former employee of the NPC.15 It is
worthy to note that NPC did not deny the existence
construction of the underground tunnel having term works. Accordingly, we consider the term
been completed in 1979 yet. works as embracing all kinds of constructions,
facilities, and other developments that can enable
Without necessarily adopting the reasoning of the or help NPC to meet its objectives of developing
CA, we uphold its conclusion that prescription did hydraulic power expressly provided under
not bar the present action to recover just paragraph (g) of Section 3. 23 The CA’s restrictive
compensation. construal of Section 3(i) as exclusive of tunnels
was obviously unwarranted, for the provision
Section 3 (i) of Republic Act No. 6395, the cited applies not only to development works easily
law, relevantly provides: discoverable or on the surface of the earth but also
to subterranean works like tunnels. Such
interpretation accords with the fundamental
Section 3. Powers and General Functions of the guideline in statutory construction that when the
Corporation. – The powers, functions, rights and law does not distinguish, so must we
activities of the Corporation shall be the following: not.24 Moreover, when the language of the statute
is plain and free from ambiguity, and expresses a
xxx single, definite, and sensible meaning, that
meaning is conclusively presumed to be the
(i) To construct works across, or otherwise, any meaning that the Congress intended to convey.25
stream, watercourse, canal, ditch, flume, street,
avenue, highway or railway of private and public Even so, we still cannot side with NPC.
ownership, as the location of said works may
require:Provided, That said works be constructed We rule that the prescriptive period provided under
in such a manner as not to endanger life or Section 3(i) of Republic Act No. 6395 is applicable
property; And provided, further, That the stream, only to an action for damages, and does not extend
watercourse, canal ditch, flume, street, avenue, to an action to recover just compensation like this
highway or railway so crossed or intersected be case. Consequently, NPC cannot thereby bar the
restored as near as possible to their former state, right of the Heirs of Macabangkit to recover just
or in a manner not to impair unnecessarily their compensation for their land.
usefulness. Every person or entity whose right of
way or property is lawfully crossed or intersected
by said works shall not obstruct any such The action to recover just compensation from the
crossings or intersection and shall grant the Board State or its expropriating agency differs from the
or its representative, the proper authority for the action for damages. The former, also known as
execution of such work. The Corporation is hereby inverse condemnation, has the objective to recover
given the right of way to locate, construct and the value of property taken in fact by the
maintain such works over and throughout the governmental defendant, even though no formal
lands owned by the Republic of the Philippines or exercise of the power of eminent domain has been
any of its branches and political subdivisions. The attempted by the taking agency.26 Just
Corporation or its representative may also enter compensation is the full and fair equivalent of the
upon private property in the lawful performance or property taken from its owner by the expropriator.
prosecution of its business and purposes, The measure is not the taker’s gain, but the
including the construction of the transmission owner’s loss. The word just is used to intensify the
lines thereon; Provided, that the owner of such meaning of the word compensation in order to
property shall be indemnified for any actual convey the idea that the equivalent to be rendered
damage caused thereby;Provided, further, That for the property to be taken shall be real,
said action for damages is filed within five years substantial, full, and ample.27 On the other hand,
after the rights of way, transmission lines, the latter action seeks to vindicate a legal wrong
substations, plants or other facilities shall have through damages, which may be actual, moral,
been established; Provided, finally, That after said nominal, temperate, liquidated, or exemplary.
period, no suit shall be brought to question the When a right is exercised in a manner not
said rights of way, transmission lines, substations, conformable with the norms enshrined in Article
plants or other facilities; 1928 and like provisions on human relations in the
Civil Code, and the exercise results to the damage
of another, a legal wrong is committed and the
A cursory reading shows that Section 3(i) covers wrongdoer is held responsible.29
the construction of "works across, or otherwise,
any stream, watercourse, canal, ditch, flume,
street, avenue, highway or railway of private and The two actions are radically different in nature
public ownership, as the location of said works and purpose. The action to recover just
may require." It is notable that Section 3(i) includes compensation is based on the Constitution 30 while
no limitation except those enumerated after the the action for damages is predicated on statutory
enactments. Indeed, the former arises from the however, violates the due process rights of
exercise by the State of its power of eminent respondents as it was without notice and
domain against private property for public use, but indemnity to them and did not go through proper
the latter emanates from the transgression of a expropriation proceedings. Petitioner could have, at
right. The fact that the owner rather than the any time, validly exercised the power of eminent
expropriator brings the former does not change the domain to acquire the easement over respondents’
essential nature of the suit as an inverse property as this power encompasses not only the
condemnation,31 for the suit is not based on tort, taking or appropriation of title to and possession of
but on the constitutional prohibition against the the expropriated property but likewise covers even
taking of property without just compensation. 32 It the imposition of a mere burden upon the owner of
would very well be contrary to the clear language of the condemned property. Significantly, though,
the Constitution to bar the recovery of just landowners cannot be deprived of their right over
compensation for private property taken for a their land until expropriation proceedings are
public use solely on the basis of statutory instituted in court. The court must then see to it
prescription. that the taking is for public use, that there is
payment of just compensation and that there is
Due to the need to construct the underground due process of law.34
tunnel, NPC should have first moved to acquire the
land from the Heirs of Macabangkit either by 3. NPC’s construction of the tunnel
voluntary tender to purchase or through formal constituted taking of the land, and
expropriation proceedings. In either case, NPC entitled owners to just compensation
would have been liable to pay to the owners the
fair market value of the land, for Section 3(h) of The Court held in National Power Corporation v.
Republic Act No. 6395 expressly requires NPC to Ibrahim that NPC was "liable to pay not merely an
pay the fair market value of such property at the easement fee but rather the full compensation for
time of the taking, thusly: land" traversed by the underground tunnels, viz:

(h) To acquire, promote, hold, transfer, sell, lease, In disregarding this procedure and failing to
rent, mortgage, encumber and otherwise dispose of recognize respondents’ ownership of the sub-
property incident to, or necessary, convenient or terrain portion, petitioner took a risk and exposed
proper to carry out the purposes for which the itself to greater liability with the passage of time. It
Corporation was created: Provided, That in case a must be emphasized that the acquisition of the
right of way is necessary for its transmission lines, easement is not without expense. The underground
easement of right of way shall only be sought: tunnels impose limitations on respondents’ use of
Provided, however, That in case the property itself the property for an indefinite period and deprive
shall be acquired by purchase, the cost thereof them of its ordinary use. Based upon the foregoing,
shall be the fair market value at the time of the respondents are clearly entitled to the payment of
taking of such property. just compensation. Notwithstanding the fact that
petitioner only occupies the sub-terrain portion, it
This was what NPC was ordered to do in National is liable to pay not merely an easement fee but
Power Corporation v. Ibrahim,33 where NPC had rather the full compensation for land. This is so
denied the right of the owners to be paid just because in this case, the nature of the easement
compensation despite their land being traversed by practically deprives the owners of its normal
the underground tunnels for siphoning water from beneficial use. Respondents, as the owner of the
Lake Lanao needed in the operation of Agus II, property thus expropriated, are entitled to a just
Agus III, Agus IV, Agus VI and Agus VII compensation which should be neither more nor
Hydroelectric Projects in Saguiran, Lanao del Sur, less, whenever it is possible to make the
in Nangca and Balo-I in Lanao del Norte and in assessment, than the money equivalent of said
Ditucalan and Fuentes in Iligan City. There, NPC property.35
similarly argued that the underground tunnels
constituted a mere easement that did not involve Here, like in National Power Corporation v.
any loss of title or possession on the part of the Ibrahim, NPC constructed a tunnel underneath the
property owners, but the Court resolved against land of the Heirs of Macabangkit without going
NPC, to wit: through formal expropriation proceedings and
without procuring their consent or at least
Petitioner contends that the underground tunnels informing them beforehand of the construction.
in this case constitute an easement upon the NPC’s construction adversely affected the owners’
property of the respondents which does not involve rights and interests because the subterranean
any loss of title or possession. The manner in intervention by NPC prevented them from
which the easement was created by petitioner, introducing any developments on the surface, and
from disposing of the land or any portion of it, Enterone, and that of the City Assessor of Iligan
either by sale or mortgage. City, the latter is more credible. Considering
however, that the appraised value of the land in
Did such consequence constitute taking of the land the area as determined by the City Assessor’s
as to entitle the owners to just compensation? Office is not uniform, this Court, is of the opinion
that the reasonable amount of just compensation
We agree with both the RTC and the CA that there of plaintiff’s land should be fixed at FIVE
was a full taking on the part of NPC, HUNDRED (500.00) PESOS, per square meter.
notwithstanding that the owners were not xxx.41
completely and actually dispossessed. It is settled
that the taking of private property for public use, The RTC based its fixing of just compensation
to be compensable, need not be an actual physical ostensibly on the prevailing market value at the
taking or appropriation.36 Indeed, the time of the filing of the complaint, instead of
expropriator’s action may be short of acquisition of reckoning from the time of the taking pursuant to
title, physical possession, or occupancy but may Section 3(h) of Republic Act No. 6395. The CA did
still amount to a taking.37 Compensable taking not dwell on the reckoning time, possibly because
includes destruction, restriction, diminution, or NPC did not assign that as an error on the part of
interruption of the rights of ownership or of the the RTC.
common and necessary use and enjoyment of the
property in a lawful manner, lessening or We rule that the reckoning value is the value at the
destroying its value.38 It is neither necessary that time of the filing of the complaint, as the RTC
the owner be wholly deprived of the use of his provided in its decision. Compensation that is
property,39 nor material whether the property is reckoned on the market value prevailing at the
removed from the possession of the owner, or in time either when NPC entered or when it completed
any respect changes hands.40 the tunnel, as NPC submits, would not be just, for
it would compound the gross unfairness already
As a result, NPC should pay just compensation for caused to the owners by NPC’s entering without
the entire land. In that regard, the RTC pegged just the intention of formally expropriating the land,
compensation at ₱500.00/square meter based on and without the prior knowledge and consent of
its finding on what the prevailing market value of the Heirs of Macabangkit. NPC’s entry denied
the property was at the time of the filing of the elementary due process of law to the owners since
complaint, and the CA upheld the RTC. then until the owners commenced the inverse
condemnation proceedings. The Court is more
We affirm the CA, considering that NPC did not concerned with the necessity to prevent NPC from
assail the valuation in the CA and in this Court. unjustly profiting from its deliberate acts of
NPC’s silence was probably due to the correctness denying due process of law to the owners. As a
of the RTC’s valuation after careful consideration measure of simple justice and ordinary fairness to
and weighing of the parties’ evidence, as follows: them, therefore, reckoning just compensation on
the value at the time the owners commenced these
inverse condemnation proceedings is entirely
The matter of what is just compensation for these warranted.
parcels of land is a matter of evidence. These
parcels of land is (sic) located in the City of Iligan,
the Industrial City of the South. Witness Dionisio In National Power Corporation v. Court of
Banawan, OIC- City Assessor’s Office, testified, Appeals,42 a case that involved the similar
"Within that area, that area is classified as construction of an underground tunnel by NPC
industrial and residential. That plaintiffs’ land is without the prior consent and knowledge of the
adjacent to many subdivisions and that is within owners, and in which we held that the basis in
the industrial classification. He testified and fixing just compensation when the initiation of the
identified Exhibit "AA" and "AA-1", a Certification, action preceded the entry into the property was the
dated April 4, 1997, showing that the appraised time of the filing of the complaint, not the time of
value of plaintiffs land ranges from ₱400.00 to taking,43 we pointed out that there was no taking
₱500.00 per square meter (see, TSN, testimony of when the entry by NPC was made "without intent
Dionisio Banawan, pp. 51, 57, and 71, February 9, to expropriate or was not made under warrant or
1999). Also, witness Banawan, testified and color of legal authority."
identified Two (2) Deeds of Sale, marked as Exhibit
"AA-2" and "AA-3,["] showing that the appraised 4.Awards for rentals, moral damages, exemplary
value of the land adjoining or adjacent to plaintiff damages, and attorney’s fees are deleted
land ranges from ₱700.00 to ₱750.00 per square for insufficiency of factual and legal bases
meter. As between the much lower price of the land
as testified by defendant’s witness Gregorio
The CA upheld the RTC’s granting to the Heirs of contingent attorney’s fee is hereby reduced from
Macabangkit of rentals of ₱ 30,000.00/month 20% to only 15% of the total amount of the claim
"from 1979 up to July 1999 with 12% interest per that may be awarded to plaintiffs," without more,
annum" by finding NPC guilty of bad faith in taking did not indicate or explain why and how the
possession of the land to construct the tunnel substantial liability of NPC for attorney’s fees could
without their knowledge and consent. have arisen and been determined.

Granting rentals is legally and factually bereft of In assessing attorney’s fees against NPC and in
justification, in light of the taking of the land being favor of the respondents, the RTC casually
already justly compensated. Conformably with the disregarded the fundamental distinction between
ruling in Manila International Airport Authority v. the two concepts of attorney’s fees — the ordinary
Rodriguez,44 in which the award of interest was and the extraordinary. These concepts were aptly
held to render the grant of back rentals distinguished in Traders Royal Bank Employees
unwarranted, we delete the award of back rentals Union-Independent v. NLRC,46 thuswise:
and in its place prescribe interest of 12% interest
per annum from November 21, 1997, the date of There are two commonly accepted concepts of
the filing of the complaint, until the full liability is attorney’s fees, the so-called ordinary and
paid by NPC. The imposition of interest of 12% extraordinary. In its ordinary concept, an
interest per annum follows a long line of pertinent attorney’s fee is the reasonable compensation paid
jurisprudence,45 whereby the Court has fixed the to a lawyer by his client for the legal services he
rate of interest on just compensation at 12% per has rendered to the latter. The basis of this
annum whenever the expropriator has not compensation is the fact of his employment by and
immediately paid just compensation. his agreement with the client.

The RTC did not state any factual and legal In its extraordinary concept, an attorney’s fee is an
justifications for awarding to the Heirs of indemnity for damages ordered by the court to be
Macabangkit moral and exemplary damages each paid by the losing party in a litigation. The basis of
in the amount of ₱200,000.00. The awards just this is any of the cases provided by law where such
appeared in the fallo of its decision. Neither did the award can be made, such as those authorized in
CA proffer any justifications for sustaining the RTC Article 2208, Civil Code, and is payable not to the
on the awards. We consider the omissions of the lawyer but to the client, unless they have agreed
lower courts as pure legal error that we feel bound that the award shall pertain to the lawyer as
to correct even if NPC did not submit that for our additional compensation or as part thereof.
consideration. There was, to begin with, no factual
and legal bases mentioned for the awards. It is By referring to the award as contingency fees, and
never trite to remind that moral and exemplary reducing the award from 20% to 15%, the RTC was
damages, not by any means liquidated or assessed really referring to a supposed agreement on
as a matter of routine, always require evidence that attorney’s fees between the Heirs of Macabangkit
establish the circumstances under which the and their counsel. As such, the concept of
claimant is entitled to them. Moreover, the failure attorney’s fees involved was the ordinary. Yet, the
of both the RTC and the CA to render the factual inclusion of the attorney’s fees in the judgment
and legal justifications for the moral and among the liabilities of NPC converted the fees to
exemplary damages in the body of their decisions extraordinary. We have to disagree with the RTC
immediately demands the striking out of the thereon, and we express our discomfort that the
awards for being in violation of the fundamental CA did not do anything to excise the clearly
rule that the decision must clearly state the facts erroneous and unfounded grant.
and the law on which it is based. Without the
factual and legal justifications, the awards are
An award of attorney’s fees has always been the
exposed as the product of conjecture and
exception rather than the rule. To start with,
speculation, which have no place in fair judicial
attorney’s fees are not awarded every time a party
prevails in a suit.47 Nor should an adverse decision
ipso facto justify an award of attorney’s fees to the
We also reverse and set aside the decree of the RTC winning party.48 The policy of the Court is that no
for NPC to pay to the Heirs of Macabangkit "the premium should be placed on the right to
sum equivalent to 15% of the total amount litigate.49 Too, such fees, as part of damages, are
awarded, as attorney’s fees, and to pay the cost." assessed only in the instances specified in Art.
The body of the decision did not state the factual 2208, Civil Code.50 Indeed, attorney’s fees are in
and legal reasons why NPC was liable for attorney’s the nature of actual damages.51 But even when a
fees. The terse statement found at the end of the claimant is compelled to litigate with third persons
body of the RTC’s decision, stating: "xxx The or to incur expenses to protect his rights,
attorney’s fees may still be withheld where no his appearance herein. He complied upon filing the
sufficient showing of bad faith could be reflected in comment.65
a party’s persistence in a suit other than an
erroneous conviction of the righteousness of his Amir Macabangkit confirmed Atty. Dibaratun’s
cause.52 And, lastly, the trial court must make representation through an ex parte manifestation
express findings of fact and law that bring the suit that he filed in his own behalf and on behalf of his
within the exception. What this demands is that siblings Mongkoy and Putri.66 Amir reiterated his
the factual, legal or equitable justifications for the manifestation on March 6, 2006,67and further
award must be set forth imputed malpractice to Atty. Ballelos for having
filed an entry of appearance bearing Amir’s forged
not only in the fallo but also in the text of the signature and for plagiarism, i.e., copying verbatim
decision, or else, the award should be thrown out the arguments contained in the pleadings
for being speculative and conjectural.53 previously filed by Atty. Dibaratun.68

Sound policy dictates that even if the NPC failed to On September 11, 2008, Atty. Ballelos submitted
raise the issue of attorney’s fees, we are not two motions, to wit: (a) a manifestation and motion
precluded from correcting the lower courts’ authorizing a certain Abdulmajeed Djamla to
patently erroneous application of the law. 54 Indeed, receive his attorney’s fees equivalent of 15% of the
the Court, in supervising the lower courts, judgment award,69 and (b) a motion to register his
possesses the ample authority to review legal attorney’s lien that he claimed was contingent.70
matters like this one even if not specifically raised
or assigned as error by the parties. Both Atty. Dibaratun and Atty. Ballelos posited
that their entitlement to attorney’s fees was
5.Attorney’s fees under quantum meruit principle contingent. Yet, a contract for a contingent fees is
are fixed at 10% of the judgment award an agreement in writing by which the fees, usually
a fixed percentage of what may be recovered in the
Based on the pending motions of Atty. action, are made to depend upon the success in
Macarupung Dibaratun and Atty. Manuel D. the effort to enforce or defend a supposed right.
Ballelos to assert their respective rights to Contingent fees depend upon an express contract,
attorney’s fees, both contending that they without which the attorney can only recover on the
represented the Heirs of Macabangkit in this case, basis of quantum meruit.71 With neither Atty.
a conflict would ensue from the finality of the Dibaratun nor Atty. Ballelos presenting a written
judgment against NPC. agreement bearing upon their supposed contingent
fees, the only way to determine their right to
A look at the history of the legal representation of appropriate attorney’s fees is to apply the principle
the Heirs of Macabangkit herein provides a helpful of quantum meruit.
predicate for resolving the conflict.
Quantum meruit – literally meaning as much as he
Atty. Dibaratun was the original counsel of the deserves – is used as basis for determining an
Heirs of Macabangkit. When the appeal was attorney’s professional fees in the absence of an
submitted for decision in the CA, 55 Atty. Ballelos express agreement.72 The recovery of attorney’s fees
filed his entry of appearance,56 and a motion for on the basis of quantum meruit is a device that
early decision.57 Atty. Ballelos subsequently filed prevents an unscrupulous client from running
also a manifestation,58 supplemental away with the fruits of the legal services of counsel
manifestation,59 without paying for it and also avoids unjust
enrichment on the part of the attorney
himself.73 An attorney must show that he is
reply,60 and ex parte motion reiterating the motion entitled to reasonable compensation for the effort
for early decision.61 It appears that a copy of the in pursuing the client’s cause, taking into account
CA’s decision was furnished solely to Atty. Ballelos. certain factors in fixing the amount of legal fees.74
However, shortly before the rendition of the
decision, Atty. Dibaratun filed in the CA a motion
to register attorney’s lien,62 alleging that he had not Rule 20.01 of the Code of Professional
withdrawn his appearance and had not been aware Responsibility lists the guidelines for determining
of the entry of appearance by Atty. Ballelos. A the proper amount of attorney fees, to wit:
similar motion was also received by the Court from
Atty. Dibaratun a few days after the petition for Rule 20.1 – A lawyer shall be guided by the
review was filed.63 Thus, on February 14, following factors in determining his fees:
2005,64 the Court directed Atty. Dibaratun to enter
a) The time spent and the extent of the and exercises the power to fix attorney’s fees on a
services rendered or required; quantum meruit basis in the absence of an express
written agreement between the attorney and the
b) The novelty and difficult of the questions client, now fixes attorney’s fees at 10% of the
involved; principal award of ₱113,532,500.00.

c) The important of the subject matter; Whether it is Atty. Dibaratun or Atty. Ballelos, or
both, who should receive attorney’s fees from the
d) The skill demanded; Heirs of Macabangkit is a question that the Court
must next determine and settle by considering the
amount and quality of the work each performed
e) The probability of losing other and the results each obtained.
employment as a result of acceptance of the
proffered case;
Atty. Dibaratun, the attorney from the outset,
unquestionably carried the bulk of the legal
f) The customary charges for similar demands of the case. He diligently prepared and
services and the schedule of fees of the IBP timely filed in behalf of the Heirs of Macabangkit
chapter to which he belongs; every pleading and paper necessary in the full
resolution of the dispute, starting from the
g) The amount involved in the controversy complaint until the very last motion filed in this
and the benefits resulting to the client from Court. He consistently appeared during the trial,
the service; and examined and cross-examined all the
witnesses presented at that stage of the
h) The contingency or certainty of proceedings. The nature, character, and substance
compensation; of each pleading and the motions he prepared for
the Heirs of Macabangkit indicated that he devoted
i) The character of the employment, substantial time and energy in researching and
whether occasional or established; and preparing the case for the trial. He even advanced
₱250,000.00 out of his own pocket to defray
j) The professional standing of the lawyer. expenses from the time of the filing of the motion
to execute pending appeal until the case reached
the Court.77 His representation of all the Heirs of
In the event of a dispute as to the amount of fees
Macabangkit was not denied by any of them.
between the attorney and his client, and the
intervention of the courts is sought, the
determination requires that there be evidence to We note that Atty. Dibaratun possessed some
prove the amount of fees and the extent and value standing in the legal profession and in his local
of the services rendered, taking into account the community. He formerly served as a member of the
facts determinative thereof.75 Ordinarily, therefore, Board of Director of the Integrated Bar of the
the determination of the attorney’s fees on Philippines (IBP), Lanao del Norte-Iligan City
quantum meruit is remanded to the lower court for Chapter, and was an IBP national awardee as Best
the purpose. However, it will be just and equitable Legal Aid Committee Chairman. He taught at
to now assess and fix the attorney’s fees of both Mindanao State University College of Law
attorneys in order that the resolution of "a Extension. He was a Municipal Mayor of
comparatively simple controversy," as Justice Matungao, Lanao del Norte, and was enthroned
Regalado put it in Traders Royal Bank Employees Sultan a Gaus.
Union-Independent v. NLRC,76 would not be
needlessly prolonged, by taking into due In contrast, not much about the character and
consideration the accepted guidelines and so much standing of Atty. Ballelos, as well as the nature
of the pertinent data as are extant in the records. and quality of the legal services he rendered for the
Heirs of Macabangkit are in the records. The
Atty. Dibaratun and Atty. Ballelos each claimed motions he filed in the
attorney’s fees equivalent to 15% of the principal
award of ₱113,532,500.00, which was the amount Court and in the CA lacked enlightening research
granted by the RTC in its decision. Considering and were insignificant to the success of the clients’
that the attorney’s fees will be defrayed by the cause. His legal service, if it can be called that,
Heirs of Macabangkit out of their actual recovery manifested no depth or assiduousness, judging
from NPC, giving to each of the two attorney’s 15% from the quality of the pleadings from him. His
of the principal award as attorney’s fees would be written submissions in the case appeared either to
excessive and unconscionable from the point of have been lifted verbatim from the pleadings
view of the clients. Thus, the Court, which holds previously filed by Atty. Dibaratun, or to have been
merely quoted from the decisions and resolutions The Court PARTLY GRANTS the motion to register
of the RTC and the CA. Of the Heirs of attorney’s lien filed by Atty. Macarupung
Macabangkit, only Cebu, Batowa-an, Sayana, Dibaratun, and FIXES Atty. Dibaratun’s attorney’s
Nasser, Manta, Mongkoy78 and Edgar gave their fees on the basis of quantum meruit at 10% of the
consent to Atty. Ballelos to appear in their behalf principal award of ₱113,532,500.00.
in the CA, which he did despite Atty. Dibaratun not
having yet filed any withdrawal of his appearance. The motion to register attorney’s lien of Atty.
The Court did not receive any notice of appearance Manuel D. Ballelos is PARTLY GRANTED, and Atty.
for the Heirs of Macabangkit from Atty. Ballelos, Ballelos is DECLARED ENTITLED TO RECOVER
but that capacity has meanwhile become doubtful from Cebu, Batowa-an, Sayana, Nasser, Manta and
in the face of Amir’s strong denial of having Edgar, all surnamed Macabangkit, the amount of
retained him.1avvphil ₱5,000.00 as attorney’s fees on the basis of
quantum meruit.
In fairness and justice, the Court accords full
recognition to Atty. Dibaratun as the counsel de Costs of suit to be paid by the petitioner.
parte of the Heirs of Macabangkit who discharged
his responsibility in the prosecution of the clients’ SO ORDERED.
cause to its successful end. It is he, not Atty.
Ballelos, who was entitled to the full amount of
G.R. No. 192100 March 12, 2014
attorney’s fees that the clients ought to pay to their
attorney. Given the amount and quality of his legal
work, his diligence and the time he expended in REPUBLIC OF THE PHILIPPINES, represented
ensuring the success of his prosecution of the by the DEPARTMENT OF PUBLIC WORKS AND
clients’ cause, he deserves the recognition, HIGHWAYS (DPWH)1, Petitioner,
notwithstanding that some of the clients might vs.
appear to have retained Atty. Ballelos after the ASIA PACIFIC INTEGRATED STEEL
rendition of a favorable judgment.79 CORPORATION, Respondent.

Atty. Ballelos may claim only from Cebu, Batowa- DECISION

an, Sayana, Nasser, Manta and Edgar, the only
parties who engaged him. The Court considers his VILLARAMA, JR., J.:
work in the case as very minimal. His
compensation under the quantum meruit principle Before this Court is a petition for review on
is fixed at ₱5,000.00, and only the Heirs of certiorari under Rule 45 of the 1997 Rules of Civil
Macabangkit earlier named are liable to him. Procedure, as amended, assailing the July 21,
2009 Decision2 of the Court of Appeals (CA) in CA-
WHEREFORE, the Court AFFIRMS the decision G.R. CV No. 90539. The CA partially affirmed the
promulgated on October 5, 2004 by the Court of September 21, 2007 Decision3 of the Regional Trial
Appeals, subject to the following MODIFICATIONS, Court (RTC), Branch 54, of Macabebe, Pampanga,
to wit: and reduced the annual legal interest awarded
from 12% to 6% per annum. Also assailed is the
(a) Interest at the rate of 12% per annum is appellate court's April 28, 2010
IMPOSED on the principal amount of Resolution4 denying petitioner's motion for
₱113,532,500.00 as just compensation, reconsideration.
reckoned from the filing of the complaint on
November 21, 1997 until the full liability is As culled from the records, the following are the
paid; pertinent facts:

(b) The awards of ₱30,000.00 as rental fee, Asia Pacific Integrated Steel Corporation
₱200,000.00 as moral damages, and (respondent) is the registered owner of a 17,175-
₱200,000.00 as exemplary damages are square meter property situated in Barangay Sta.
DELETED; and Monica, Municipality of San Simon, Province of
Pampanga and covered by Transfer Certificate of
(c) The award of 15% attorney’s fees Title (TCT) No. 271813-R.5
decreed to be paid by National Power
Corporation to the Heirs of Macabangkit is On March 1, 2002, the Republic of the Philippines
DELETED. (petitioner) through the Toll Regulatory Board
(TRB) instituted expropriation proceedings against
the respondent over a portion of their property. The
affected area, consisting of 2,024 square meters,
shall be traversed by the expansion of the San The affected lot is within the area wherein the land
Simon Interchange, an integral component of the use are residential, commercial, and industrial
construction, rehabilitation and expansion of the (mixed land use), as per Vicinity Map hereto
North Luzon Expressway (NLEX Project). attached as Annex "B". The area is along
Subsequently, petitioner filed an urgent ex-parte MacArthur Highway, Quezon Road, Municipal and
motion for issuance of writ of possession, stating Barangay Roads[.]
that it deposited with the Land Bank of the
Philippines (LBP) the amount of ₱607,200.00 In the absence of bonafide sales transaction in the
(100% of the value of the property based on area, the Assessor’s Office being aware of the
current zonal valuation of the Bureau of Internal actual conditions of subject property decided to
Revenue [BIR]) in accordance with Section 4(a) of use opinion values in the determination of the
Republic Act No. 89746 (R.A. 8794), and hence the current and fair market value for the purpose of
court has the ministerial duty to place petitioner in payment of just compensation.
possession pursuant to Section 2, Rule 67 of the
Rules of Civil Procedure.7 OPINION VALUES

On March 19, 2002, the trial court issued an order A. Real Estate Brokers/Independent
granting petitioner’s motion and directing the Appraisers/Owners, etc.
Register of Deeds of Pampanga to cause the
annotation of the writ of possession on TCT No.
271813-R.8 1. Residential - ranging from ₱2,000.00 to
₱2,500.00 per square meter
In its Answer with Opposition to the Motion for
2. Commercial - ranging from ₱2,500.00 to
Issuance of Writ of Possession,9 respondent
₱3,000.00 per square meter
questioned the TRB’s authority to expropriate the
subject property and objected to petitioner’s offered
compensation which respondent deems unjust 3. Industrial - ranging from ₱1,000.00 above per
because the basis thereof - the BIR zonal valuation square meter
- was an unofficial valuation, being merely based
on an internal memorandum issued by BIR B. Banks and Financial Institutions
Revenue District No. 21, not by the Asset Valuation
Department of the BIR National Office. Respondent 1. Residential - ranging from ₱1,000.00 to
asserted that just compensation should be at ₱2,000.00 per square meter
₱3,036,000.00 or at ₱1,500.00 per square meter
plus consequential damages, considering the fair 2. Commercial - ranging from ₱2,000.00 to
market value and the industrial classification of ₱3,000.00 per square meter
the subject property.
3. Residential - ranging from ₱1,000.00 to
During the pre-trial conference, the parties agreed ₱1,500.00 per square meter
on TRB’s authority to expropriate the subject
property but disagreed as to the amount of just
Appraisal conducted by the Assessor of San Simon,
compensation. Petitioner offered to pay
Pampanga for various properties within the area,
₱607,200.00 for the portion taken but respondent
recommended an amount ranging from ₱1,000.00
made a counter-offer of ₱1,821,600.00. The parties
to ₱1,500.00, Philippine currency, per square
eventually agreed to submit the issue of just
meter, depending on their proximity to the national
compensation to three Commissioners composed of
roads, municipal roads, and barangay roads, and
the Municipal Assessor of San Simon as Chairman,
the improvement/development put in place. The
and the RTC Branch Clerk of Court and the
amount of ₱1,000.00 to ₱1,500.00 was arrived at
Register of Deeds for the Province of Pampanga as
by the undersigned commissioners due to the
conversion of the subject property from
agricultural to industrial use as evidenced by the
On June 1, 2004, the trial court granted Order of Conversion dated July 8, 1991, issued by
respondent’s motion to withdraw the ₱607,200.00 Renato B. Padilla, Undersecretary, Department of
deposited by petitioner with the LBP as partial Agrarian Reform, a xerox copy of which is hereto
payment for just compensation.11 attached [as] Annex "C".12

On June 9, 2004, the Commissioners submitted On September 23, 2004, an ocular inspection was
their Report with the following findings and conducted in the presence of the parties’
representatives and their respective counsels, pertaining to easement of right of way should be
during which the trial court noted the following: lower than that in the Deed of Absolute Sale. x x x

1. There is an existing toll plaza on the right lane of xxxx

the expressway facing the direction of Manila with
blue colored roofing. Using the recommendation of the three (3)
commissioners as guide, the Court finds the
2. Comprised in the aforesaid toll plaza are three amount of ONE THOUSAND THREE HUNDRED
toll booths. The third booth located on the extreme PESOS (Php1,300.00) per square meter as just
right facing Manila occupies a portion of the compensation for the property subject of
expropriated portion of defendant’s property. expropriation.

3. The expropriated portion which is shown in a WHEREFORE, premises considered, judgment is

sketch which was marked as Exhibit H is indicated rendered:
by its color: green. It has an area of 2,021 square
meters. The remaining unexpropriated portion of 1) Ordering the plaintiff to pay the defendant in the
defendant’s land has an area of 15,151 square amount of TWO MILLION TWENTY FOUR
meters. THOUSAND PESOS (Php2,024,000.00)
representing the net amount of just compensation
4. The unexpropriated portion of the land of after deducting the partial payment of ₱607,200.00
defendant is presently very much below the level of based on the valuation of Php1,300.00 per square
the expressway because the expressway was meter on the expropriated portion of the parcel of
upgraded. It is immediately adjacent to the existing land [Lot 329-A of the subdivision, plan (LRC) Psd-
expressway, located as it is, on its right side facing 246403, being a portion of lot 329, San Simon,
Manila. It is swampy with little water.13 LRC. Cad Rec. No. 1316] with an area of 2,024
square meters situated in Sta. Monica, San Simon,
In its Decision, the trial court ruled as follows: Pampanga covered by Transfer Certificate of Title
No. 271813-R plus legal interest of 12% per
x x x Although there was no documentary evidence annum from the time of taking (March 21, 2002)
attached to substantiate the opinions of the banks until fully paid less taxes due on the land.
and the realtors indicated in the Commissioners’
Report, the Court finds the commissioners’ 2) Ordering the plaintiff to pay the costs and/or
recommendation of the valuation of industrial expenses in relation to the transfer of ownership of
lands at ₱1,000.00 to ₱1,500.00 to be fair, absent the property in its favor from defendant Asia Pacific
any showing that the valuation is exorbitant or Integrated Steel Corporation.
otherwise unjustified. There was no fraud or
prejudice that tainted the report. 3) Condemning the property subject of
expropriation free from all liens and encumbrances
The Court finds the valuation of the Republic of the for the construction, rehabilitation and expansion
Philippines which was pegged at Php300.00 per of the North Luzon Expressway.
square meter to be very low. The zonal valuation of
the Bureau of Internal Revenue (Exhibits A and B SO ORDERED.14
with submarkings) is merely a gauge or is
necessary in the assessment of correct transfer Petitioner appealed to the CA, arguing that the just
taxes by the said office. Furthermore the compensation should not be more than ₱300.00
Department Order No. 23-98 took effect only last per square meter and that the correct rate of
February 2, 1998 which was four (4) years prior to interest is 6% per annum.
the filing of the complaint. The same is true with
Ordinance No. 17, Series of 1994 issued by the The CA upheld the trial court’s ruling, reiterating
Sangguniang Panlalawigan of Pampanga (Exhibit the principle that the determination of just
E) which was issued eight (8) years also prior to compensation is an inherently judicial function. It
the filing of the complaint. stressed that any valuation for just compensation
laid down in statutes merely serve as guides or
Concerning the Deed of Absolute Sale (Exhibit C) factors and may not substitute the court’s own
notarized on July 19, 2002, the same was undated judgment as to what amount should be awarded
and pertains only to a right of way. An easement of and how to arrive at such amount.15
right of way transmits no rights except the
easement itself. Hence, the just compensation Further, the CA noted that petitioner itself
admitted that the BIR zonal valuation is only for
the purpose of determining the correct amount of Hence, this petition assailing the CA’s affirmance
transfer taxes. It held that while BIR zonal of the trial court’s award of just compensation, the
valuation may be a factor in determining just legal basis of which is allegedly insufficient.
compensation, the same is not a competent basis
thereof. Citing R.A. 8974, the CA pointed out the Petitioner argues that the evidence for determining
distinction between provisional value as a the amount of just compensation in expropriation
precondition for the issuance of a writ of cases should be on those factors provided in
possession and the payment of just compensation Section 5 of R.A. 8974. Considering such factors
for the expropriated property. While the provisional and the evidence submitted by the parties before
value is based on the zonal value as may be the trial court, petitioner maintains that just
determined by the BIR, just compensation is based compensation for the subject property should be
on the prevailing fair market value of the property. no more than the zonal valuation (₱300.00 per
Necessarily, the zonal valuation of properties is not square meter), and in no case should it amount to
equivalent to their fair market value.16 the market value of ₱1,300.00 per square meter
adjudged by the trial and appellate courts.
After examining the records, the CA found no Petitioner claims that such huge sum for only
reversible error in the trial court’s determination of 2,024-square meter portion of respondent’s
just compensation and held that the valuation of 17,175-square meter property, is unbelievably
₱1,500.00 per square meter is more in consonance 433.4% more than the 1998 BIR zonal value for an
with the concept of just compensation based upon underdeveloped industrial land at the time of its
due consideration of all evidence. Thus: taking.

It is equally settled that the valuation of a property On the other hand, respondent contends that no
in tax declarations cannot be a substitute to just reversible error was committed by the CA in
compensation. Elsewise stated, the market value affirming the trial court’s decision after considering
reflected in the tax declaration of the condemned all the arguments raised by petitioner and the
property is no longer conclusive. Accordingly, we evidence on record. It asserts that the main issue
cannot appreciate the herein tax declaration in of just compensation and the findings thereon by
favor of the Republic. the trial court as affirmed by the CA is a question
of fact which should not be disturbed by this
Further, it is uncontested that the deed of sale Court. Moreover, respondent asserts that the
dated July 19, 2002 between San Simon Realty, determination by the trial court is entitled to the
Inc. and the Republic pertained only to a right of highest respect considering that the judge has
way, hence, the value thereof should be personal knowledge of the condition of the subject
considerably lower. Ordinance No. 17, as correctly property, having conducted an ocular inspection
found by the RTC, was issued on June 22, 1994 or on September 23, 2004.
eight (8) years prior to the institution of the herein
complaint. Certainly, the valuation of properties We grant the petition.
therein can by no means be reflective of the
current, prevailing and fair value of the subject As a rule, a petition for review under Rule 45 of the
property. The Republic failed to present evidence to Rules of Court covers only questions of law.
controvert he RTC’s finding on the matter. Neither Questions of fact are not reviewable and cannot be
has it shown that the property sold thereunder passed upon by this Court in the exercise of its
shares the same features as the herein subject power to review. The distinction between questions
property as to warrant a similar valuation. We of law and questions of fact is established. A
cannot, thus, yield to the Republic’s submission question of law exists when the doubt or difference
that its evidence are the proper basis in centers on what the law is on a certain state of
determining just compensation for Asia Pacific’s facts. A question of fact, on the other hand, exists
property.17 if the doubt centers on the truth or falsity of the
alleged facts.18 This being so, the findings of fact of
However, the CA modified the rate of interest the CA are final and conclusive and this Court will
imposed on the amount due as just compensation not review them on appeal.19
from 12% to 6% in conformity with prevailing
jurisprudence. For a question to be one of law, the same must not
involve an examination of the probative value of
On April 28, 2010, the CA denied petitioner’s the evidence presented by the litigants or any of
motion for reconsideration, stating that the them. The resolution of the issue must rest solely
argument on valuation by petitioner was merely a on what the law provides on the given set of
rehash of what the CA had already passed upon. circumstances.20 In this case, the only legal issue
raised by petitioner is whether the trial court based
its determination of just compensation on the based merely on the opinions of bankers and
factors provided under existing laws and realtors.
In National Power Corporation v. Manubay Agro-
Section 5 of R.A. 8974 enumerates the standards Industrial Development Corporation,21 the
for assessing the value of expropriated land taken recommended price of the city assessor was
for national government infrastructure projects, rejected by this Court. The opinions of the banks
thus: and the realtors as reflected in the computation of
the market value of the property and in the
SECTION 5. Standards for the Assessment of the Commissioners’ Report, were not substantiated by
Value of the Land Subject of Expropriation any documentary evidence.
Proceedings or Negotiated Sale. – In order to
facilitate the determination of just compensation, Similarly, in National Power Corporation v. Diato-
the court may consider, among other well- Bernal,22 this Court rejected the valuation
established factors, the following relevant recommended by court-appointed commissioners
standards: whose conclusions were devoid of any actual and
reliable basis. The market values of the subject
(a) The classification and use for which the property’s neighboring lots were found to be mere
property is suited; estimates and unsupported by any corroborative
documents, such as sworn declarations of realtors
(b) The developmental costs for improving the land; in the area concerned, tax declarations or zonal
valuation from the BIR for the contiguous
residential dwellings and commercial
(c) The value declared by the owners; establishments. Thus, we ruled that a
commissioners’ report of land prices which is not
(d) The current selling price of similar lands in the based on any documentary evidence is manifestly
vicinity; hearsay and should be disregarded by the court.

(e) The reasonable disturbance compensation for We find that the trial court did not judiciously
the removal and/or demolition of certain determine the fair market value of the subject
improvements on the land and for the value of the property as it failed to consider other relevant
improvements thereon; factors such as the zonal valuation, tax
declarations and current selling price supported by
(f) The size, shape or location, tax declaration and documentary evidence. Indeed, just compensation
zonal valuation of the land; must not be arrived at arbitrarily, but determined
after an evaluation of different factors.23
(g) The price of the land as manifested in the ocular
findings, oral as well as documentary evidence Just compensation is defined as the full and fair
presented; and equivalent of the property taken from its owner by
the expropriator. The measure is not the taker’s
(h) Such facts and events as to enable the affected gain, but the owner’s loss. The word "just" is used
property owners to have sufficient funds to acquire to intensify the meaning of the word
similarly-situated lands of approximate areas as "compensation" and to convey thereby the idea that
those required from them by the government, and the equivalent to be rendered for the property to be
thereby rehabilitate themselves as early as taken shall be real, substantial, full, and ample.
possible. Such "just"-ness of the compensation can only be
attained by using reliable and actual data as bases
In this case, the trial court considered only (a) and in fixing the value of the condemned
(d): (1) the classification of the subject property property.24 Trial courts are required to be more
which is located in an area with mixed land use circumspect in its evaluation of just compensation
(commercial, residential and industrial) and the due the property owner, considering that eminent
property’s conversion from agricultural to domain cases involve the expenditure of public
industrial land, and (2) the current selling price of funds.25
similar lands in the vicinity – the only factors
which the commissioners included in their Report. We agree with the trial court that it was not bound
It also found the commissioners’ recommended by the assessment report of the commissioners and
valuation of ₱1,000.00 to ₱1,500.00 per square to that it had the discretion to reject the same and
be fair and just despite the absence of substitute its own judgment on its value as
documentary substantiation as said prices were gathered from the record, or it may accept the
report/recommendation of the commissioners in
toto and base its judgment thereon. However, the described in terms of only two or three classes of
decision of the court must be based on all building materials and estimates of areas are more
established rules, upon correct legal principles and often inaccurate than correct. Tax values can serve
competent evidence.26The court is proscribed from as guides but cannot be absolute substitutes for
basing its judgment on speculations and surmises. just compensation." (Emphasis supplied.)

Nonetheless, we cannot subscribe to petitioner’s Among the factors to be considered in arriving at

argument that just compensation for the subject the fair market value of the property are the cost of
property should not exceed the zonal valuation acquisition, the current value of like properties, its
(₱300.00 per square meter). actual or potential uses, and in the particular case
of lands, their size, shape, location, and the tax
In Republic v. Court of Appeals,27 we held that -- declarations thereon. The measure is not the
taker's gain but the owner's loss.30 To be just, the
The constitutional limitation of "just compensation must be fair not only to the owner
compensation" is considered to be the sum but also to the taker.31
equivalent to the market value of the property,
broadly described to be the price fixed by the seller It is settled that the final conclusions on the proper
in open market in the usual and ordinary course of amount of just compensation can only be made
legal action and competition or the fair value of the after due ascertainment of the requirements set
property as between one who receives, and one forth under R.A. 8974 and not merely based on the
who desires to sell, it fixed at the time of the actual declarations of the parties.32 Since these
taking by the government. x x x requirements were not satisfactorily complied with,
and in the absence of reliable and actual data as
Zonal valuation is just one of the indices of the fair bases in fixing the value of the condemned
market value of real estate. By itself, this index property, remand of this case to the trial court is in
cannot be the sole basis of "just compensation" in order.
expropriation cases.28 As this Court ruled in Leca
Realty Corporation v. Rep. of the Phils.29: WHEREFORE, the petition for review on certiorari
is GRANTED. The Decision dated July 21, 2009
The Republic is incorrect, however, in alleging that and Resolution dated April 28, 2010 of the Court of
the values were exorbitant, merely because they Appeals in CA-G.R. CV No. 90539 are hereby SET
exceeded the maximum zonal value of real ASIDE.
properties in the same location where the subject
properties were located. The zonal value may be This case is remanded to the trial court for the
one, but not necessarily the sole, index of the value proper determination of just compensation, in
of a realty. National Power Corporation v. Manubay conformity with this Decision.
Agro-Industrial held thus:
"x x x [Market value] is not limited to the assessed
value of the property or to the schedule of market G.R. No. 127820 July 20, 1998
values determined by the provincial or city
appraisal committee. However, these values may MUNICIPALITY OF PARAÑAQUE, petitioner,
serve as factors to be considered in the judicial
valuation of the property." vs. V.M. REALTY CORPORATION, respondent.

The above ruling finds support in EPZA v. Dulay in PANGANIBAN, J.:

this wise:
A local government unit (LGU), like the
"Various factors can come into play in the Municipality of Parañaque, cannot authorize an
valuation of specific properties singled out for expropriation of private property through a mere
expropriation.1âwphi1 The values given by resolution of its lawmaking body. The Local
provincial assessors are usually uniform for very Government Code expressly and clearly requires an
wide areas covering several barrios or even an ordinance or a local law for the purpose. A
entire town with the exception of the poblacion. resolution that merely expresses the sentiment or
Individual differences are never taken into account. opinion of the Municipal Council will not suffice.
The value of land is based on such generalities as On the other hand, the principle of res
its possible cultivation for rice, com, coconuts or judicata does not bar subsequent proceedings for
other crops. Very often land described as 'cogonal' the expropriation of the same property when all the
has been cultivated for generations. Buildings are
legal requirements for its valid exercise are Pursuant to Sangguniang Bayan Resolution No.
complied with. 93-95, Series of 1993, 6 the Municipality of
Parañaque filed on September 20, 1993, a
Statement of the Case Complaint for expropriation 7 against Private
Respondent V.M. Realty Corporation over two
These principles are applied by this Court in parcels of land (Lots 2-A-2 and 2-B-1 of
resolving this petition for review on certiorari of the Subdivision Plan Psd-17917), with a combined
July 22, 1996 Decision 1 of the Court of area of about 10,000 square meters, located at
Appeals 2 in CA GR CV No. 48048, which Wakas, San Dionisio, Parañaque, Metro Manila,
affirmed in toto 3 the Regional Trial Court's and covered by Torrens Certificate of Title No.
August 9, 1994 Resolution. 4 The trial court 48700. Allegedly, the complaint was filed "for
dismissed the expropriation suit as follows: the purpose of alleviating the living conditions
of the underprivileged by providing homes for
the homeless through a socialized housing
The right of the plaintiff to exercise the power project." 8 Parenthetically, it was also for this
of eminent domain is not disputed. However, stated purpose that petitioner, pursuant to
such right may be exercised only pursuant to its Sangguniang Bayan Resolution No. 577,
an Ordinance (Sec. 19, R.A No. 7160). In the Series of 1991, 9 previously made an offer to
instant case, there is no such ordinance passed enter into a negotiated sale of the property
by the Municipal Council of Parañaque enabling with private respondent, which the latter did
the Municipality, thru its Chief Executive, to not accept. 10
exercise the power of eminent domain. The
complaint, therefore, states no cause of action.
Finding the Complaint sufficient in form and
substance, the Regional Trial Court of Makati,
Assuming that plaintiff has a cause of action, Branch 134, issued an Order dated January 10,
the same is barred by a prior judgment. On 1994, 11 giving it due course. Acting on
September 29, 1987, the plaintiff filed a petitioner's motion, said court issued an Order
complaint for expropriation involving the same dated February 4, 1994, 12 authorizing
parcels of land which was docketed as Civil petitioner to take possession of the subject
Case No. 17939 of this Court (page 26, record). property upon deposit with its clerk of court of
Said case was dismissed with prejudice on May an amount equivalent to 15 percent of its fair
18, 1988 (page 39, record). The order of market value based on its current tax
dismissal was not appealed, hence, the same declaration.
became final. The plaintiff can not be allowed
to pursue the present action without violating
the principle of [r]es [j]udicata. While defendant On February 21, 1994, private respondent filed
in Civil Case No. 17939 was Limpan Investment its Answer containing affirmative defenses and
Corporation, the doctrine of res judicata still a counterclaim, 13 alleging in the main that (a)
applies because the judgment in said case (C.C. the complaint failed to state a cause of action
No. 17939) is conclusive between the parties because it was filed pursuant to a resolution
and their successors-in-interest (Vda. de Buncio and not to an ordinance as required by RA 7160
vs. Estate of the late Anita de Leon). The herein (the Local Government Code); and (b) the cause
defendant is the successor-in-interest of of action, if any, was barred by a prior judgment
Limpan Investment Corporation as shown by or res judicata. On private respondent's
the "Deed of Assignment Exchange" executed motion, its Answer was treated as a motion to
on June 13, 1990. dismiss. 14 On March 24, 1991, 15 petitioner
filed its opposition, stressing that the trial
court's Order dated February 4, 1994 was in
WHEREFORE, defendant's motion for accord with Section 19 of RA 7160, and that
reconsideration is hereby granted. The order the principle of res judicata was not applicable.
dated February 4, 1994 is vacated and set
Thereafter, the trial court issued its August 9,
1994 Resolution 16 nullifying its February 4,
This case is hereby dismissed. No 1994 Order and dismissing the case.
pronouncement as to costs. Petitioner's motions for reconsideration and
transfer of venue were denied by the trial court
in a Resolution dated December 2,
1994. 17 Petitioner then appealed to
Factual Antecedents Respondent Court, raising the following issues:
1. Whether or not the Resolution of the exercise of the power of eminent
Parañaque Municipal Council No. 93-95, Series domain." 23 Petitioner seeks to bolster this
of 1993 is a substantial compliance of the contention by citing Article 36, Rule VI of the
statutory requirement of Section 19, R.A. 7180 Rules and Regulations Implementing the Local
[sic] in the exercise of the power of eminent Government Code, which provides. "If the LGU
domain by the plaintiff-appellant. fails to acquire a private property for public
use, purpose, or welfare through purchase, the
2. Whether or not the complaint in this case LGU may expropriate said property through
states no cause of action. a resolution of the Sanggunian authorizing its
chief executive to initiate expropriation
3. Whether or not the strict adherence to the proceedings." 24 (Emphasis supplied.)
literal observance to the rule of procedure
resulted in technicality standing in the way of The Court disagrees. The power of eminent
substantial justice. domain is lodged in the legislative branch of
government, which may delegate the exercise
4. Whether or not the principle of res thereof to LGUs, other public entities and
judicata is applicable to the present case. 18 public utilities. 25 An LGU may therefore
exercise the power to expropriate private
property only when authorized by Congress and
As previously mentioned, the Court of Appeals subject to the latter's control and restraints,
affirmed in toto the trial court's Decision. imposed "through the law conferring the power
Respondent Court, in its assailed Resolution or in other legislations." 26 In this case, Section
promulgated on January 8, 1997, 19 denied 19 of RA 7160, which delegates to LGUs the
petitioner's Motion for Reconsideration for lack power of eminent domain, also lays down the
of merit. parameters for its exercise. It provides as
Hence, this appeal. 20

Sec. 19. Eminent Domain. A local government

The Issues unit may, through its chief executive and
acting pursuant to an ordinance, exercise the
Before this Court, petitioner posits two power of eminent domain for public use, or
issues, viz.: purpose, or welfare for the benefit of the poor
and the landless, upon payment of just
1. A resolution duly approved by the municipal compensation, pursuant to the provisions of
council has the same force and effect of an the Constitution and pertinent
ordinance and will not deprive an expropriation laws: Provided, however, That the power of
case of a valid cause of action. eminent domain may not be exercised unless a
valid and definite offer has been previously
2. The principle of res judicata as a ground for made to the owner, and such offer was not
dismissal of case is not applicable when public accepted: Provided, further, That the local
interest is primarily involved. 21 government unit may immediately take
possession of the property upon the filing of
the expropriation proceedings and upon making
The Court's Ruling
a deposit with the proper court of at least
fifteen percent (15%) of the fair market value of
The petition is not meritorious. the property based on the current tax
declaration of the property to be
First Issue: expropriated: Provided, finally, That, the
amount to be paid for the expropriated property
Resolution Different from an Ordinance shall be determined by the proper court, based
on the fair market value at the time of the
Petitioner contends that a resolution approved taking of the property. (Emphasis supplied)
by the municipal council for the purpose of Thus, the following essential requisites must
initiating an expropriation case "substantially concur before an LGU can exercise the power of
complies with the requirements of the eminent domain:
law" 22 because the terms "ordinance" and
"resolution" are synonymous for "the purpose of 1. An ordinance is enacted by the local
bestowing authority [on] the local government legislative council authorizing the local chief
unit through its chief executive to initiate the executive, in behalf of the LGU, to exercise the
expropriation proceedings in court in the power of eminent domain or pursue
expropriation proceedings over a particular the law is applied according to its express
private property. terms, and interpretation would be resorted to
only where a literal interpretation would be
2. The power of eminent domain is exercised resorted to only where a literal interpretation
for public use, purpose or welfare, or for the would be either impossible or absurd or would
benefit of the poor and the landless. lead to an injustice." 34 In the instant case,
there is no reason to depart from this rule,
3. There is payment of just compensation, as since the law requiring an ordinance is not at
required under Section 9, Article III of the all impossible, absurd, or unjust.
Constitution, and other pertinent laws.
Moreover, the power of eminent domain
4. A valid and definite offer has been previously necessarily involves a derogation of a
made to the owner of the property sought to be fundamental or private right of the
expropriated, but said offer was not accepted. 27 people. 35 Accordingly, the manifest change in
the legislative language — from "resolution"
under BP 337 to "ordinance" under RA 7160 —
In the case at bar, the local chief executive demands a strict construction. "No species of
sought to exercise the power of eminent property is held by individuals with greater
domain pursuant to a resolution of the tenacity, and is guarded by the Constitution
municipal council. Thus, there was no and laws more sedulously, than the right to the
compliance with the first requisite that the freehold of inhabitants. When the legislature
mayor be authorized through an ordinance. interferes with that right and, for greater public
Petitioner cites Camarines Sur vs. Court of purposes, appropriates the land of an individual
Appeals 28 to show that a resolution may suffice without his consent, the plain meaning of the
to support the exercise of eminent domain by law should not be enlarged by doubtful
an LGU. 29 This case, however, is not in point interpretation." 36
because the applicable law at that time was BP
337, 30 the previous Local Government Code,
which had provided that a mere resolution Petitioner relies on Article 36, Rule VI of the
would enable an LGU to exercise eminent Implementing Rules, which requires only a
domain. In contrast, RA 7160, 31 the present resolution to authorize an LGU to exercise
Local Government Code which was already in eminent domain. This is clearly misplaced,
force when the Complaint for expropriation was because Section 19 of RA 7160, the law itself,
filed, explicitly required an ordinance for this surely prevails over said rule which merely
purpose. seeks to implement it. 37 It is axiomatic that
the clear letter of the law is controlling and
cannot be amended by a mere administrative
We are not convinced by petitioner's insistence rule issued for its implementation. Besides,
that the terms "resolution" and "ordinance" are what the discrepancy seems to indicate is a
synonymous. A municipal ordinance is different mere oversight in the wording of the
from a resolution. An ordinance is a law, but a implementing rules, since Article 32, Rule VI
resolution is merely a declaration of the thereof, also requires that, in exercising the
sentiment or opinion of a lawmaking body on a power of eminent domain, the chief executive
specific matter. 32 An ordinance possesses a of the LGU act pursuant to an ordinance.
general and permanent character, but a
resolution is temporary in nature. Additionally,
the two are enacted differently — a third In this ruling, the Court does not diminish the
reading is necessary for an ordinance, but not policy embodied in Section 2, Article X of the
for a resolution, unless decided otherwise by a Constitution, which provides that "territorial
majority of all the Sanggunian members. 33 and political subdivisions shall enjoy local
autonomy." It merely upholds the law as worded
in RA 7160. We stress that an LGU is created by
If Congress intended to allow LGUs to exercise law and all its powers and rights are sourced
eminent domain through a mere resolution, it therefrom. It has therefore no power to amend
would have simply adopted the language of the or act beyond the authority given and the
previous Local Government Code. But Congress limitations imposed on it by law. Strictly
did not. In a clear divergence from the previous speaking, the power of eminent domain
Local Government Code, Section 19 of RA 7160 delegated to an LGU is in reality not eminent
categorically requires that the local chief but "inferior" domain, since it must conform to
executive act pursuant to an ordinance. Indeed, the limits imposed by the delegation, and thus
"[l]egislative intent is determined principally partakes only of a share in eminent
from the language of a statute. Where the domain. 38 Indeed, "the national legislature is
language of a statute is clear and unambiguous,
still the principal of the local government units, matter and cause of action, which has been
which cannot defy its will or modify or violate rendered by a court having jurisdiction over it.
it." 39
Be that as it may, the Court holds that the
Complaint Does Not principle of res judicata, which finds
application in generally all cases and
State a Cause of Action proceedings, 45 cannot bar the right of the State
or its agent to expropriate private property. The
In its Brief filed before Respondent Court, very nature of eminent domain, as an inherent
petitioner argues that its Sangguniang power of the State, dictates that the right to
Bayan passed an ordinance on October 11, exercise the power be absolute and unfettered
1994 which reiterated its Resolution No. 93-35, even by a prior judgment or res judicata. The
Series of 1993, and ratified all the acts of its scope of eminent domain is plenary and, like
mayor regarding the subject expropriation. 40 police power, can "reach every form of property
which the State might need for public
use." 46 "All separate interests of individuals in
This argument is bereft of merit. In the first property are held of the government under this
place, petitioner merely alleged the existence of tacit agreement or implied reservation.
such an ordinance, but it did not present any Notwithstanding the grant to individuals, the
certified true copy thereof. In the second place, eminent domain, the highest and most exact
petitioner did not raise this point before this idea of property, remains in the government, or
Court. In fact, it was mentioned by private in the aggregate body of the people in their
respondent, and only in passing. 41 In any sovereign capacity; and they have the right to
event, this allegation does not cure the resume the possession of the property
inherent defect of petitioner's Complaint for whenever the public interest requires
expropriation filed on September 23, 1993. It is it." 47 Thus, the State or its authorized agent
hornbook doctrine that cannot be forever barred from exercising
said right by reason alone of previous non-
. . . in a motion to dismiss based on the ground compliance with any legal requirement.
that the complaint fails to state a cause of
action, the question submitted before the court While the principle of res judicata does not
for determination is the sufficiency of the denigrate the right of the State to exercise
allegations in the complaint itself. Whether eminent domain, it does apply to specific issues
those allegations are true or not is beside the decided in a previous case. For example, a final
point, for their truth is hypothetically admitted judgment dismissing an expropriation suit on
by the motion. The issue rather is: admitting the ground that there was no prior offer
them to be true, may the court render a valid precludes another suit raising the same issue; it
judgment in accordance with the prayer of the cannot, however, bar the State or its agent from
complaint? 42 thereafter complying with this requirement, as
prescribed by law, and subsequently exercising
The fact that there is no cause of action is its power of eminent domain over the same
evident from the face of the Complaint for property. 48 By the same token, our ruling that
expropriation which was based on a mere petitioner cannot exercise its delegated power
resolution. The absence of an ordinance of eminent domain through a mere resolution
authorizing the same is equivalent to lack of will not bar it from reinstituting similar
cause of action. Consequently, the Court of proceedings, once the said legal requirement
Appeals committed no reversible error in and, for that matter, all others are properly
affirming the trial court's Decision which complied with. Parenthetically and by parity of
dismissed the expropriation suit. reasoning, the same is also true of the principle
of "law of the case." In Republic vs. De
Second Issue: Knecht, 49 the Court ruled that the power of the
State or its agent to exercise eminent domain is
Eminent Domain Not Barred by Res Judicata not diminished by the mere fact that a prior
final judgment over the property to be
As correctly found by the Court of expropriated has become the law of the case as
Appeals 43 and the trial court, 44 all the to the parties. The State or its authorized agent
requisites for the application of res judicata are may still subsequently exercise its right to
present in this case. There is a previous final expropriate the same property, once all legal
judgment on the merits in a prior expropriation requirements are complied with. To rule
case involving identical interests, subject otherwise will not only improperly diminish the
power of eminent domain, but also clearly
defeat social justice.

WHEREFORE, the petition is hereby DENIED

without prejudice to petitioner's proper
exercise of its power of eminent domain over
subject property. Costs against petitioner.