G.R. No.

L-59603, April 29, 1987

Export Processing Zone Authority vs Hon. Ceferino Dulay
Ponente: Gutierrez, Jr.
Facts:
January 1957, president of the Philippines issued proclamation no 1811 reserving a
parcel of land in Lapu-lapu for the establishment of an export processing zone. Not all the
reserved land was public. EPZA then offered to purchase the lands from its registered owners,
in the valuation set by PD 464,as amended. The owners did not agree.
EPZA filed with CFI-Cebu a complaint for expropriation with a prayer for the issuance of
a writ of possession against the landowners. Judge Dulay, later issued a writ of possession
authorizing EPZA to take immediate possession of the premises.
After the recommendation of the appointed commissioners as to the just compensation,
EPZA filed for a motion for reconsideration saying that the PD 464, as amended, superseded
the rules of court. The trial court denied the motion. EPZA then filed for certiorari and
mandamus with preliminary restraining order.

Issue:
Whether PD 76, 464, 794 and 1533 have repealed the Revised Rules of Court, such that
in determining just compensation in expropriation shall be based only in its market value as
declared by the owner or by assessor, whichever is lower.

Ruling:
PD 464 on just compensation is unconstitutional and void. The method of just
compensation provided by PD 464 is an encroachment on judicial prerogatives, contradicting
the Constitution which reserved the power to determine just compensation to the Court's final
determination. We are convinced and so rule that the trial court correctly stated that the
valuation in the decree may only serve as a guiding principle or one of the factors in determining
just compensation but it may not substitute the court's own judgment as to what amount should
be awarded and how to arrive at such amount.
Just compensation means the value of the property at the time of the taking. It means a
fair and full equivalent for the loss sustained. All the facts as to the condition of the property and
its surroundings, its improvements and capabilities, should be considered. The determination of
"just compensation" in eminent domain cases is a judicial function. The executive department or
the legislature may make the initial determinations but when a party claims a violation of the
guarantee in the Bill of Rights that private property may not be taken for public use without just
compensation, no statute, decree, or executive order can mandate that its own determination
shall prevail over the court's findings. Much less can the courts be precluded from looking into
the "just-ness" of the decreed compensation.