V.

EMINENT DOMAIN
D. Taking

Secretary of DPWH vs Heracleo Case Digest GR 179334 Apr 21 2015

Facts:

Spouses “Heracleo” are the co-owners of a land which is among the private properties traversed
by MacArthur Highway in Bulacan, a government project undertaken sometime in 1940. The
taking was taken without the requisite expropriation proceedings and without their consent. In
1994, Heracleo demanded the payment of the fair market value of the property. The DPWH
offered to pay 0.70 centavos per sqm., as recommended by the appraiser committee of
Bulacan. Unsatisfied, Heracleo filed a complaint for recovery of possession with damages.
Favorable decisions were rendered by the RTC and the CA, with valuation of P 1,500 per sqm
and 6% interest per annum from the time of filing of the until full payment. The SC Division
reversed the CA ruling and held that computation should be based at the time the property was
taken in 1940, which is 0.70 per sqm. But because of the contrasting opinions of the members
of the Division and transcendental importance of the issue, the case was referred to the En
Banc for resolution.

Issue 1: W/N the taking of private property without due process should be nullified

No. The government’s failure to initiate the necessary expropriation proceedings prior to actual
taking cannot simply invalidate the State’s exercise of its eminent domain power, given that the
property subject of expropriation is indubitably devoted for public use, and public policy imposes
upon the public utility the obligation to continue its services to the public. To hastily nullify said
expropriation in the guise of lack of due process would certainly diminish or weaken one of the
State’s inherent powers, the ultimate objective of which is to serve the greater good.

Thus, the non-filing of the case for expropriation will not necessarily lead to the return of the
property to the landowner. What is left to the landowner is the right of compensation.

Issue 2: W/N compensation is based on the market value of the property at the time of taking

Yes. While it may appear inequitable to the private owners to receive an outdated valuation, the
long-established rule is that the fair equivalent of a property should be computed not at the time
of payment, but at the time of taking. This is because the purpose of ‘just compensation’ is not
to reward the owner for the property taken but to compensate him for the loss
thereof. The owner should be compensated only for what he actually loses, and what he loses is
the actual value of the property at the time it is taken.

Issue 3: W/N the principle of equity should be applied in this case

No. The Court must adhere to the doctrine that its first and fundamental duty is the application
of the law according to its express terms, interpretation being called for only when such literal
application is impossible. To entertain other formula for computing just compensation, contrary
to those established by law and jurisprudence, would open varying interpretation of economic
policies – a matter which this Court has no competence to take cognizance of. Equity and
equitable principles only come into full play when a gap exists in the law and jurisprudence.

Velasco Dissent:

The State’s power of eminent domain is not absolute; the Constitution is clear that no person
shall be deprived of life, liberty and property without due process of law. As such, failure of the
government to institute the necessary proceedings should lead to failure of taking an individual’s
property. In this case, since the property was already taken, the complainants must be equitably
compensated for the loss thereof.

For purposes of “just” compensation, the value of the land should be determined from the time
the property owners filed the initiatory complaint, earning interest therefrom. To hold otherwise
would validate the State’s act as one of expropriation in spite of procedural infirmities which, in
turn, would amount to unjust enrichment on its part. To continue condoning such acts would be
licensing the government to continue dispensing with constitutional requirements in taking
private property.

Fausto, Michael Angelo B.

JD 1-C