JUST COMPENSATION

Concept of just compensation

YUJUICO VS. ATIENZA, G.R. No. 164282 (October 12, 2005) SECOND DIVISION

Just compensation means not only the correct determination of the amount to be paid to the
owner of the land but also the payment of the land within a reasonable time from its taking.
Without prompt payment, compensation cannot be considered ‘just’ for the property owner is
made to suffer the consequence of being immediately deprived of his/her land while being made
to wait for five years.

MUNICIPALITY OF DAET VS. COURT OF APPEALS, G.R. No. L-35861 (October 18, 1979)
FIRST DIVISION

The assessed value of a property cannot be made the basis of just compensation. The decree
only fixes the provisional value of the property to serve as the basis for the immediate
occupancy of the property being expropriated.

CITY OF MANILA VS. CORRALES, G.R. No. 10076 (October 28, 1915) EN BANC

In taking private property for public use under the power of eminent domain, the persons whose
property is taken should be paid the reasonable market value of their property but they should
not take advantage of the necessity of the public by demanding more than the value of their
property. Neither should the Government be allowed to take the property at a lesser price than
its market value at the time of the expropriation. The market value is the value purchasers
generally would pay for the property.

CITY OF MANILA VS. ESTRADA, G.R. No.7749 (September 9, 1913) EN BANC

‘Compensation’ under the Spanish Code of Civil Procedure means an equivalent for the value of
the land taken. Anything beyond that is more and anything short of that is less than
compensation. The word ‘just’ is used merely to intensify the meaning of the word
‘compensation’.

79) Ansaldo vs. Tantuico (188 SCRA 300

FACTS:

Two lots of private ownership were taken by the Government and used for the widening of a
road for more than forty-three years, without benefit of an action of eminent domino
agreement with its owners. The owners of the land are Jose Ma. Ansaldo and Maria Angela
Ansaldo, are covered by title in their names and have an aggregate area of 1,041 square
meters. These lots were taken from the Ansaldos sometime in 1947 by the Department of
Public Work Transportation and Communication and made part of what used to be Sta.
Mesa Street and is now Ramon Magsaysay Avenue at San Juan, Metro Manila. The said
owners did not make any action until twenty six years later asking for the compensation of their
land. The case was referred to the Secretary of Justice who rendered an opinion that the
just compensation be made in accordance with Presidential Decree 76 which provide that
the basis for the payment of just compensation of property taken for public use should
be the current and fair market value thereof as declared by the owner or administrator,
or such market value as determined by the assessor, whichever was lower.
Commissioner of Public Highways requested the Provincial Assessor of Rizal to make a
redetermination of the market value of the Ansaldos' property in accordance with PD 76. The
new valuation was made, after which the Auditor of the Bureau of Public Highways
forwarded the Ansaldos' claim to the Auditor General with the recommendation that
payment be made on the basis of the current and fair market value and not on the fair market
value at the time of taking. The Commission on Audit declined the recommendation and
decided that the compensation be from the actual time of the taking of the land.

ISSUE:

(As to the precise time the just compensation be based) Whether or not the just
compensation be based on the time of the actual taking of the possession or PD 76.

HELD:

In the context of the State's inherent power of eminent domain, there is a taking
when the owner is actually deprived or dispossessed of his property; when there is a
practical destruction or a material impairment of the value of his property or when he is deprived
of the ordinary use thereof. There is a taking in this sense when the expropriator enters
private property not only for a momentary period but for a more permanent duration, for
the purpose of devoting the property to a public use in such a manner as to oust the owner
and deprive him of all beneficial enjoyment thereof. For ownership, after all, "is nothing
without the inherent rights of possession, control and enjoyment. Where the owner is
deprived of the ordinary and beneficial use of his property or of its value by its being diverted to
public use, there is taking within the Constitutional sense. Under these norms, there was
undoubtedly a taking of the Ansaldos' property when the Government obtained possession
thereof and converted it into a part of a thoroughfare for public use.

It is as of the time of such a taking, to repeat, that the just compensation for the
property is to be established. As stated in Republic v. Philippine National Bank;

When plaintiff takes possession before the institution of the condemnation proceedings,
the value should be fixed as of the time of the taking of said possession, not of filing of the
complaint and the latter should be the basis for the determination of the value, when the
taking of the property involved coincides with or is subsequent to, the commencement of
the proceedings. Indeed, otherwise, the provision of Rule 69, Section 3, directing that
compensation be determined as of the date of the filing of the complaint' would never
be operative. As intimated in Republic v. Lara (supra), said provision contemplates normal
circumstances, under which the complaint coincides or even precedes the taking of the property
by the plaintiff.
The reason for the rule, as pointed out in Republic v. Larae, is that; Where property is taken
ahead of the filing of the condemnation proceedings, the value thereof may be enhanced
by the public purpose for which it is taken; the entry by the plaintiff upon the property may
have depreciated its value thereby; or, there may have been a natural increase in the
value of the property from the time the complaint is filed, due to general economic
conditions. The owner of private property should be compensated only for what he
actually loses; it is not intended that his compensation shall extend beyond his loss or injury.
And what he loses is only the actual value of his property at the time it is taken. This is the only
way that compensation to be paid can be truly just i.e., “just; not only to the individual
whose property is taken but, to the public, which is to pay for it.

Clearly, then, the value of the Ansaldos' property must be ascertained as of the year
1947, when it was actually taken, and not at the time of the filing of the expropriation suit, which,
by the way, still has to be done. It is as of that time that the real measure of their loss may fairly
be adjudged. The value, once fixed, shall earn interest at the legal rate until full
payment is effected, conformably with other principles laid down by case law. The
petition is denied and the challenged decision of the Commission on Audit is affirmed, and
the Department of Public Works and Highways is directed to forthwith institute the
appropriate expropriation action over the land in question so that the just compensation
due its owners may be determined in accordance with the Rules of Court, with interest
at the legal rate of six percent (6%) per annum from the time of taking until full payment is
made.

80) Manila Railway Co. Vs. Velasquez (32 Phil 286)

DEFINITION

81) Eslaban vs. De Onorio ( G.R. No. 146062, June 28, 2001)

FACTS:

Clarita De Onorio is the owner of a lot in South Cotabato. Santiago Eslaban, is a project
Manager of the NIA, who approved the construction of the main irrigation canal of the NIA on
the said lot.

Respondent’s husband agreed to the construction of the NIA canal in exchange for
compensation for the area taken after the processing of documents by the Commission on
Audit. a Right-of-Way agreement was executed between De Onorio and the NIA who paid the
former for the Right-of-Way damages. Respondent De Onorio subsequently executed an
Affidavit of Waiver of Rights and Fees whereby she waived any compensation for damages to
crops and improvements which she suffered as a result of the construction of a right-of-way on
her property.

The same year, Eslaban offered the respondent the sum of P35,000.00 by way of an amicable
settlement. De Onorio demanded payment for the taking of her property, but Eslaban refused to
pay. Accordingly, De Onorio filed on a complaint against Eslaban before the RTC, praying that
Eslaban be ordered to pay as compensation for the portion of her property used in the
construction of the canal constructed by the NIA, litigation expenses, and the costs.

Eslaban filed an answer admitting that NIA constructed an irrigation canal over the property of
the De Onorio and that NIA paid a certain landowner whose property had been taken for
irrigation purposes. The trial court rendered a decision ordering NIA to pay to De Onorio the
sum of P107,517.60 as just compensation for the questioned area of 24,660 square meters of
land owned by De Onorio and be taken by said defendant NIA which used it for its main canal
plus costs.

The Court of Appeals affirmed the decision of the RTC upon appeal by petitioner Eslaban.
Hence this petition.

ISSUE:

Whether the value of just compensation shall be determined from the time of the taking or from
the time of the finality of the decision?

HELD:

With respect to the compensation which the owner of the condemned property is entitled to
receive, it is likewise settled that it is the market value which should be paid or “that sum of
money which a person, desirous but not compelled to buy, and an owner, willing but not
compelled to sell, would agree on as a price to be given and received therefor.”

Further, just compensation means not only the correct amount to be paid to the owner of the
land but also the payment of the land within a reasonable time from its taking. Without prompt
payment, compensation cannot be considered “just” for then the property owner is made to
suffer the consequence of being immediately deprived of his land while being made to wait for a
decade or more before actually receiving the amount necessary to cope with his loss.9
Nevertheless, there are instances where the expropriating agency takes over the property prior
to the expropriation suit, in which case just compensation shall be determined as of the time of
taking, not as of the time of filing of the action of eminent domain.
 82) Republic vs. IAC, et al. (G.R. No. 71176, May 21, 1990)

FACTS:

The property involved consists of four parcels of land located on Dr. Manuel L. Carreon Street,
Manila. The Solicitor General filed for the Department of Education and Culture (DEC) a
complaint against Amerex for the expropriation of said property before the Court of First
Instance of Manila The complaint stated that the property was needed by the government as a
permanent site for the a High School Building. That the fair market value of the property had
been declared by Amerex as P2,435,000, and that the assessor had determined its market
value as P2,432,042 and assessed it for taxation purposes in the amount of P1,303,470. In a
motion praying that the plaintiff be authorized to take immediate possession of the property, the
then Acting Solicitor General Hugo E. Gutierrez, Jr., invoking Presidential Decree No. 42,
informed the court that said assessed value of the property for taxation purposes had been
deposited with the Philippine National Bank. Consequently, the court issued an order directing
the sheriff to place the plaintiff in possession of the property. The plaintiff took actual possession
while Amerex filed a motion to dismiss the complaint stating that while it was not contesting the
merits of the complaint, the same failed to categorically state the amount of just compensation
for the property and therefore prayed for just compensation be fixed at P2,432,042, the market
value of the property determined by the assessor which was lower than Amerex’s own
declaration. The motion to dismiss was opposed by the plaintiff, the lower court issued an order
vesting the plaintiff with the lawful light to take the property upon payment of just compensation
as provided by law. Thereafter, the lower court ordered Amerex to submit an audited financial
statement on the acquisition cost of the property including expenses for its improvement.
Amerex was also allowed by the court, after it had filed a second motion therefor, to withdraw
the P1,303,470 deposit with the PNB. the plaintiff filed a motion for leave of court to amend
which was0 admitted. In the meantime, Amerex submitted to the court “audited financial
statements’ yielded the amount of P2,258,018.48 as the total value of the property.

The plaintiff elevated the case to the then Intermediate Appellate Court (IAC) for review. On
October 29, 1984, it affirmed the appealed decision with the modification that the plaintiff
Republic of the Philippines be exempted from the payment of the commissioners’ fees, the
P500.00 granted each of them for the preparation of the report and the costs.

ISSUE:

Whether respondent Court erred in determining the petitioner’s just compensation?

HELD:

Yes, the courts below made an erroneous determination of just compensation in this case. The
just compensation prescribed herein is based on the commissioners’ recommendation which in
turn is founded on the “audited” statements of Amerex that the property is worth P2,258,018.57.
As earlier pointed out, while the court may accept the commissioners’ report and render
judgment in accordance therewith, it may not do so without considering whether the report is
supported by evidence. The court is also duty-bound to determine whether the commissioners
had discharged the trust reposed in them according to well-established rules and formed their
judgment upon correct legal principles for they are not supposed to act ad libitum. It is clear
from these certifications that the accounting firm which issued them merely compared the
figures in the schedules or “audited” statements with those of the records and books of accounts
of Amerex. As no investigation was made as to the veracity of the figures in the account, there
was no audit in the real sense of the term. To audit is to examine an account, compare it with
the vouchers, adjust the same, and to state the balance, by persons legally authorized for the
purpose.

83) Sec. of DPWH vs. Spouses Tecson (G.R. No. 179334, July 1, 2013 and April 21, 2015)

FACTS:

Respondent spouses Heracleo and Ramona Tecson (respondents) are co-owners of a parcel of
land with an area of 7.268 square meters located in San Pablo, Malolos, Bulacan. The said
parcel of land was among the properties taken by the government sometime in 1940 without the
owner’s consent and without the necessary expropriation proceedings and used for the
construction of the MacArthur Highway. In a letter dated December 15, 1994, respondents’
demanded the payment of the fair market value of the subject parcel of land. DPWH, offered to
pay the subject land at the rate of PO.70 per square meter per Resolution of the Provincial
Appraisal Committee (PACIo Bulacan). Unsatisfied with the offer, respondents demanded for
the return of their property or the payment of compensation at the current fair market value of P
1,500/ sqm

ISSUE:

'I. Whether or not the respondents-movants are entitled to just compensation

2. Whether or not the valuation would be based on the corresponding value at the time of the
taking or at the time of the filing of the action

3. Whether or not the taking of private property without due process should be nullified

HELD:

1. When a property is taken by the government for public use, jurisprudence clearly provides for
the remedies available to a landowner. The owner may recover his property if its return is
feasible or, if it is not the aggrieved owner may demand payment of just compensation for the
land taken. For failure of respondents to question the lack of expropriation proceedings for a
long period of line, they are deemed to have waived and are estopped from assailing the power
of the government to expropriate or the public use for which the power was exercised. What is
left to respondents is the right of compensation. The trial and appellate courts found that
respondents are entitled to compensation.

2. Just compensation is defined as the fair market value of the property between one who
receives and one who desires to sell, fixed at the time of taking by the government.” This rule
holds true when the property is taken before the Filing of an expropriation suit, and even if it is
the property owner who brings the action for compensation.

The Court in the previous cases was confronted with common factual circumstances where the
government took control and possession of the subject properties for public use without initiating
expropriation proceedings and without payment of just compensation, while the landowners
failed for a long period of time to question such government act and later instituted actions for
recovery of possession with damages. The Court thus determined the landowners’ right to the
payment of just compensation and, more importantly, the amount of just