Documente Academic
Documente Profesional
Documente Cultură
Supreme Court
Manila
EN BANC
CORONA, C.J.,
*
CARPIO,
CARPIO MORALES,
VELASCO, JR.,
NACHURA,
- versus - LEONARDO-DE CASTRO,
BRION,
**
PERALTA,
BERSAMIN,
DEL CASTILLO,
***
ABAD,
VILLARAMA, JR.,
PEREZ,
LAND BANK OF THE MENDOZA, and
PHILIPPINES, SERENO, JJ.
Respondent. Promulgated:
R E S O LUTIO N
BRION, J.:
For a fuller and clearer presentation and appreciation of this Resolution, we hark
back to the roots of this case.
Factual Antecedents
Apo Fruits Corporation (AFC) and Hijo Plantation, Inc. (HPI), together also
referred to as petitioners, were registered owners of vast tracks of land; AFC
owned 640.3483 hectares, while HPI owned 805.5308 hectares. On October 12,
1995, they voluntarily offered to sell these landholdings to the
government via Voluntary Offer to Sell applications filed with the Department of
Agrarian Reform (DAR).
On October 16, 1996, AFC and HPI received separate notices of land
acquisition and valuation of their properties from the DARs Provincial Agrarian
Reform Officer (PARO). At the assessed valuation of P165,484.47 per hectare,
AFCs land was valued atP86,900,925.88, while HPIs property was valued
at P164,478,178.14. HPI and AFC rejected these valuations for being very low.
In its follow through action, the DAR requested the Land Bank of the
Philippines (LBP) to deposit P26,409,549.86 in AFCs bank account
and P45,481,706.76 in HPIs bank account, which amounts the petitioners then
withdrew. The titles over AFC and HPIs properties were thereafter cancelled, and
new ones were issued on December 9, 1996 in the name of the Republic of
the Philippines.
On February 14, 1997, AFC and HPI filed separate petitions for determination of
just compensation with the DAR Adjudication Board (DARAB). When the DARAB
failed to act on these petitions for more than three years, AFC and HPI filed
separate complaints for determination and payment of just compensation with the
Regional Trial Court (RTC) of Tagum City, acting as a Special Agrarian
Court.These complaints were subsequently consolidated.
On September 25, 2001, the RTC resolved the consolidated cases, fixing the just
compensation for the petitioners 1,338.6027 hectares of
[1]
land at P1,383,179,000.00, with interest on this amount at the prevailing market
interest rates, computed from the taking of the properties on December 9, 1996
until fully paid, minus the amounts the petitioners already received under the initial
valuation. The RTC also awarded attorneys fees.
LBP moved for the reconsideration of the decision. The RTC, in its order of
December 5, 2001, modified its ruling and fixed the interest at the rate of 12%
per annum from the time the complaint was filed until finality of the
decision. The Third Division of this Court, in its Decision of February 6, 2007,
affirmed this RTC decision.
On motion for reconsideration, the Third Division issued its Resolution of
December 19, 2007, modifying its February 6, 2007 Decision by deleting the 12%
interest due on the balance of the awarded just compensation. The Third Division
justified the deletion by the finding that the LBP did not delay the payment of just
compensation as it had deposited the pertinent amounts due to AFC and HPI
within fourteen months after they filed their complaints for just compensation with
the RTC. The Court also considered that AFC had already collected
approximately P149.6 million, while HPI had already collected
approximately P262 million from the LBP. The Third Division also deleted the
award of attorneys fees.
All parties moved for the reconsideration of the modified ruling. The Court
uniformly denied all the motions in its April 30, 2008 Resolution. Entry of
Judgment followed on May 16, 2008.
Notwithstanding the Entry of Judgment, AFC and HPI filed the following motions
on May 28, 2008: (1) Motion for Leave to File and Admit Second Motion for
Reconsideration; (2) Second Motion for Reconsideration, with respect to the denial
of the award of legal interest and attorneys fees; and (3) Motion to Refer the
Second Motion for Reconsideration to the Honorable Court En Banc.
The Third Division found the motion to admit the Second Motion for
Reconsideration and the motion to refer this second motion to the Court En
Banc meritorious, and accordingly referred the case to the Court En Banc. On
September 8, 2009, the Court En Bancaccepted the referral.
On these premises, Justice Nazario pointed out that the government deprived
the petitioners of their property on December 9, 1996, and paid the balance of the
just compensation due them only on May 9, 2008. The delay of almost twelve
years earned the petitioners interest in the total amount of P1,331,124,223.05.
Despite this finding, Justice Chico-Nazario did not see it fit to declare the
computed interest to be totally due; she found it unconscionable to apply the full
force of the law on the LBP because of the magnitude of the amount due. She thus
reduced the awarded interest to P400,000,000.00, or approximately 30% of the
computed interest.
The LBP commented on the petitioners motion for reconsideration on April 28,
2010. It maintained that: (a) the doctrine of immutability of the decisions of the
Supreme Court clearly applies to the present case; (b) the LBP is not guilty of
undue delay in the payment of just compensation as the petitioners were promptly
paid once the Court had determined the final value of the properties expropriated;
(c) the Supreme Court rulings invoked by the petitioners are inapplicable to the
present case; (d) since the obligation to pay just compensation is not a forbearance
of money, interest should commence only after the amount due becomes
ascertainable or liquidated, and the 12% interest per annum applies only to the
liquidated amount, from the date of finality of judgment; (e) the imposition of 12%
interest on the balance of P971,409,831.68 is unwarranted because there was no
unjustified refusal by LBP to pay just compensation, and no contractual breach is
involved; (f) the deletion of the attorneys fees equivalent to 10% of the amount
finally awarded as just compensation is proper; (g) this case does not involve a
violation of substantial justice to justify the alteration of the immutable resolution
dated December 19, 2007 that deleted the award of interest and attorneys fees.
At the heart of the present controversy is the Third Divisions December 19,
2007 Resolution which held that the petitioners are not entitled to 12% interest on
the balance of the just compensation belatedly paid by the LBP. In the presently
assailed December 4, 2009 Resolution, we affirmed the December 19, 2007
Resolutions findings that: (a) the LBP deposited pertinent amounts in favor of the
petitioners within fourteen months after they filed their complaint for
determination of just compensation; and (b) the LBP had already paid the
petitioners P411,769,168.32. We concluded then that these circumstances refuted
the petitioners assertion of unreasonable delay on the part of the LBP.
Eminent domain is the power of the State to take private property for public
[3]
use. It is an inherent power of State as it is a power necessary for the States
existence; it is a power the State cannot do without. [4] As an inherent power, it does
not need at all to be embodied in the Constitution; if it is mentioned at all, it is
solely for purposes of limiting what is otherwise an unlimited power. The
limitation is found in the Bill of Rights [5] that part of the Constitution whose
provisions all aim at the protection of individuals against the excessive exercise of
governmental powers.
In the present case, while the DAR initially valued the petitioners
landholdings at a total of P251,379,104.02,[11] the RTC, acting as a special agrarian
court, determined the actual value of the petitioners landholdings to
be P1,383,179,000.00. This valuation, a finding of fact, has subsequently been
affirmed by this Court, and is now beyond question. In eminent domain terms, this
amount is the real, substantial, full and ample compensation the government must
pay to be just to the landowners.
Significantly, this final judicial valuation is far removed from the initial
valuation made by the DAR; their values differ byP1,131,799,897.00 in itself a
very substantial sum that is roughly four times the original DAR valuation. We
mention these valuations as they indicate to us how undervalued the petitioners
lands had been at the start, particularly at the time the petitioners landholdings
were taken. This reason apparently compelled the petitioners to relentlessly pursue
their valuation claims all they way up to the level of this Court.
While the LBP deposited the total amount of P71,891,256.62 into the
petitioners accounts (P26,409,549.86 for AFC andP45,481,706.76 for HPI) at the
time the landholdings were taken, these amounts were mere partial payments that
only amounted to 5% of the P1,383,179,000.00 actual value of the expropriated
properties. We point this aspect out to show that the initial payments made by the
LBP when the petitioners landholdings were taken, although promptly withdrawn
by the petitioners, could not by any means be considered a fair exchange of values
at the time of taking; in fact, the LBPs actual deposit could not be said to be
substantial even from the original LBP valuation of P251,379,103.90.
Thus, the deposits might have been sufficient for purposes of the immediate
taking of the landholdings but cannot be claimed as amounts that would excuse the
LBP from the payment of interest on the unpaid balance of the compensation due.
As discussed at length below, they were not enough to compensate the petitioners
for the potential income the landholdings could have earned for them if no
immediate taking had taken place. Under the circumstances, the State acted
oppressively and was far from just in their position to deny the petitioners of the
potential income that the immediate taking of their properties entailed.
Apart from the requirement that compensation for expropriated land must be
fair and reasonable, compensation, to be just, must also be made without delay.
[12]
Without prompt payment, compensation cannot be considered "just" if the
property is immediately takenas the property owner suffers the immediate
deprivation of both his land and its fruits or income.
This is the principle at the core of the present case where the petitioners
were made to wait for more than a decade after the taking of their property before
they actually received the full amount of the principal of the just compensation due
them.[13] What they have not received to date is the income of their
landholdings corresponding to what they would have received had no
uncompensated taking of these lands been immediately made. This income, in
terms of the interest on the unpaid principal, is the subject of the current litigation.
We recognized in Republic v. Court of Appeals[14] the need for prompt
payment and the necessity of the payment of interest to compensate for any delay
in the payment of compensation for property already taken. We ruled in this case
that:
In Republic, the Court recognized that the just compensation due to the
landowners for their expropriated property amounted to an effective
forbearance on the part of the State. Applying the Eastern Shipping
Lines ruling,[17] the Court fixed the applicable interest rate at 12% per annum,
computed from the time the property was taken until the full amount of just
compensation was paid, in order to eliminate the issue of the constant fluctuation
and inflation of the value of the currency over time. In the Courts own words:
The Bulacan trial court, in its 1979 decision, was correct in imposing interest[s]
on the zonal value of the property to be computed from the time petitioner
instituted condemnation proceedings and took the property in September
1969. This allowance of interest on the amount found to be the value of the
property as of the time of the taking computed, being an effective
forbearance, at 12% per annum should help eliminate the issue of the
constant fluctuation and inflation of the value of the currency over time.
[18]
[Emphasis supplied.]
We subsequently upheld Republics 12% per annum interest rate on the
unpaid expropriation compensation in the following cases:Reyes v. National
Housing Authority,[19] Land Bank of the Philippines v. Wycoco,[20] Republic v. Court
of Appeals,[21] Land Bank of the Philippines v. Imperial,[22] Philippine Ports
Authority v. Rosales-Bondoc,[23] and Curata v. Philippine Ports Authority.[24]
These were the established rulings that stood before this Court issued the
currently assailed Resolution of December 4, 2009. These would be the rulings
this Court shall reverse and de-establish if we maintain and affirm our ruling
deleting the 12% interest on the unpaid balance of compensation due for
properties already taken.
The owners loss, of course, is not only his property but also its income-
generating potential. Thus, when property is taken, full compensation of its value
must immediately be paid to achieve a fair exchange for the property and the
potential income lost. The just compensation is made available to the property
owner so that he may derive income from this compensation, in the same manner
that he would have derived income from his expropriated property. If full
compensation is not paid for property taken, then the State must make up for the
shortfall in the earning potential immediately lost due to the taking, and the
absence of replacement property from which income can be derived; interest on the
unpaid compensation becomes due as compliance with the constitutional mandate
on eminent domain and as a basic measure of fairness.
In the context of this case, when the LBP took the petitioners landholdings
without the corresponding full payment, it became liable to the petitioners for the
income the landholdings would have earned had they not immediately been taken
from the petitioners. What is interesting in this interplay, under the developments
of this case, is that the LBP, by taking landholdings without full payment while
holding on at the same time to the interest that it should have paid, effectively
used or retained funds that should go to the landowners and thereby took
advantage of these funds for its own account.
From this point of view, the December 19, 2007 Resolution deleting the
award of 12% interest is not only patently and legally wrong, but is also morally
unconscionable for being grossly unfair and unjust. If the interest on the just
compensation due in reality the equivalent of the fruits or income of the
landholdings would have yielded had these lands not been taken would be denied,
the result is effectively a confiscatory action by this Court in favor of the LBP. We
would be allowing the LBP, for twelve long years, to have free use of the interest
that should have gone to the landowners. Otherwise stated, if we continue to deny
the petitioners present motion for reconsideration, we would illogically and
without much thought to the fairness that the situation demands uphold the
interests of the LBP, not only at the expense of the landowners but also that of
substantial justice as well.
The DARs initial gross undervaluation started the cycle of court actions that
followed, where the LBP eventually claimed that it could not be faulted for seeking
judicial recourse to defend the governments and its own interests in light of the
petitioners valuation claims. This LBP claim, of course, conveniently forgets that
at the root of all these valuation claims and counterclaims was the initial gross
undervaluation by DAR that the LBP stoutly defended. At the end, this
undervaluation was proven incorrect by no less than this Court; the petitioners
were proven correct in their claim, and the correct valuation more than five-fold
the initial DAR valuation was decreed and became final.
To be sure, the petitioners were not completely correct in the legal steps they
took in their valuation claims. They initially filed their valuation claim before the
DARAB instead of immediately seeking judicial intervention. The DARAB,
however, contributed its share to the petitioners error when it failed or refused to
act on the valuation petitions for more than three (3) years. Thus, on top of the
DAR undervaluation was the DARAB inaction after the petitioners landholdings
had been taken. This Courts Decision of February 6, 2007 duly noted this and
observed:
It is not controverted that this case started way back on 12 October 1995,
when AFC and HPI voluntarily offered to sell the properties to the DAR. In view
of the failure of the parties to agree on the valuation of the properties, the
Complaint for Determination of Just Compensation was filed before the DARAB
on 14 February 1997. Despite the lapse of more than three years from the filing
of the complaint, the DARAB failed to render a decision on the valuation of the
land. Meantime, the titles over the properties of AFC and HPI had already been
cancelled and in their place a new certificate of title was issued in the name of the
Republic of the Philippines, even as far back as 9 December 1996. A period of
almost 10 years has lapsed. For this reason, there is no dispute that this case has
truly languished for a long period of time, the delay being mainly attributable to
both official inaction and indecision, particularly on the determination of the
amount of just compensation, to the detriment of AFC and HPI, which to date,
have yet to be fully compensated for the properties which are already in the hands
of farmer-beneficiaries, who, due to the lapse of time, may have already converted
or sold the land awarded to them.
Verily, these two cases could have been disposed with dispatch were it
not for LBPs counsel causing unnecessary delay. At the inception of this case,
DARAB, an agency of the DAR which was commissioned by law to determine
just compensation, sat on the cases for three years, which was the reason that AFC
and HPI filed the cases before the RTC. We underscore the pronouncement of the
RTC that the delay by DARAB in the determination of just compensation
could only mean the reluctance of the Department of Agrarian Reform and
the Land Bank of the Philippines to pay the claim of just compensation by
corporate landowners.
These statements cannot but be true today as they were when we originally
decided the case and awarded 12% interest on the balance of the just compensation
due. While the petitioners were undisputedly mistaken in initially seeking recourse
through the DAR, this agency itself hence, the government committed a graver
transgression when it failed to act at all on the petitioners complaints for
determination of just compensation.
The LBP claims in its Comment that our rulings in Republic v. Court of
Appeals,[26] Reyes v. National Housing Authority,[27] andLand Bank of the
Philippines v. Imperial,[28] cannot be applied to the present case.
We likewise find no basis to support the LBPs theory that Republic and the
present case have to be treated differently because the first involves a regular
expropriation case, while the present case involves expropriation pursuant to the
countrys agrarian reform program. In both cases, the power of eminent domain was
used and private property was taken for public use. Why one should be different
from the other, so that the just compensation ruling in one should not apply to the
other, truly escapes us. If there is to be a difference, the treatment of agrarian
reform expropriations should be stricter and on a higher plane because of the
governments societal concerns and objectives. To be sure, the government cannot
attempt to remedy the ills of one sector of society by sacrificing the interests of
others within the same society.
Finally, we note that the finality of the decision (that fixed the value of just
compensation) in Republic was not a material consideration for the Court in
awarding the landowners 12% interest. The Court, in Republic, simply affirmed the
RTC ruling imposing legal interest on the amount of just compensation due. In the
process, the Court determined that the legal interest should be 12% after
recognizing that the just compensation due was effectively a forbearance on the
part of the government. Had the finality of the judgment been the critical factor,
then the 12% interest should have been imposed from the time the RTC decision
fixing just compensation became final. Instead, the 12% interest was imposed
from the time that the Republic commenced condemnation proceedings and took
the property.
The LBP additionally asserts that the petitioners erroneously relied on the
ruling in Reyes v. National Housing Authority. The LBP claims that we cannot
apply Reyes because it involved just compensation that remained unpaid despite
the finality of the expropriation decision. LBPs point of distinction is that just
compensation was immediately paid in the present case upon the Courts
determination of the actual value of the expropriated properties. LBP claims, too,
that in Reyes, the Court established that the refusal of the NHA to pay just
compensation was unfounded and unjustified, whereas the LBP in the present case
clearly demonstrated its willingness to pay just compensation. Lastly, in Reyes, the
records showed that there was an outstanding balance that ought to be paid, while
the element of an outstanding balance is absent in the present case.
Contrary to the LBPs opinion, the imposition of the 12% interest in Reyes did not
depend on either the finality of the decision of the expropriation court, or on the
finding that the NHAs refusal to pay just compensation was unfounded and
unjustified. Quite clearly, the Court imposed 12% interest based on the ruling
in Republic v. Court of Appeals that x x x if property is taken for public use before
compensation is deposited with the court having jurisdiction over the case, the
final compensation must include interest[s] on its just value to be computed from
the time the property is taken to the time when compensation is actually paid or
deposited with the court. In fine, between the taking of the property and the actual
payment, legal interest[s] accrue in order to place the owner in a position as good
as (but not better than) the position he was in before the taking occurred. [29] This is
the same legal principle applicable to the present case, as discussed above.
While the LBP immediately paid the remaining balance on the just compensation
due to the petitioners after this Court had fixed the value of the expropriated
properties, it overlooks one essential fact from the time that the State took the
petitioners properties until the time that the petitioners were fully paid, almost 12
long years passed. This is the rationale for imposing the 12% interest in order to
compensate the petitioners for the income they would have made had they been
properly compensated for their properties at the time of the taking.
Finally, the LBP insists that the petitioners quoted our ruling in Land Bank of the
Philippines v. Imperial out of context. According to the LBP, the Court imposed
legal interest of 12% per annum only after December 31, 2006, the date when the
decision on just compensation became final.
The LBP is again mistaken. The Imperial case involved land that was expropriated
pursuant to Presidential Decree No. 27,[30] and fell under the coverage of DAR
Administrative Order (AO) No. 13.[31] This AO provided for the payment of a 6%
annual interest if there is any delay in payment of just compensation.
However, Imperial was decided in 2007 and AO No. 13 was only effective up to
December 2006. Thus, the Court, relying on our ruling in the Republic case,
applied the prevailing 12% interest ruling to the period when the just compensation
remained unpaid after December 2006. It is for this reason that December 31, 2006
was important, not because it was the date of finality of the decision on just
compensation.
To fully reflect the concerns raised in this Courts deliberations on the present
case, we feel it appropriate to discuss the Justice Minita Chico-Nazarios dissent
from the Courts December 4, 2009 Resolution.
Neither can LBPs payment of the full compensation due before the finality
of the judgment of this Court justify the reduction of the interest due them. To rule
otherwise would be to forget that the petitioners had to wait twelve years from the
time they gave up their lands before the government fully paid the principal of the
just compensation due them. These were twelve years when they had no income
from their landholdings because these landholdings have immediately been taken;
no income, or inadequate income, accrued to them from the proceeds of
compensation payment due them because full payment has been withheld by
government.
If the full payment of the principal sum of the just compensation is legally
significant at all under the circumstances of this case, the significance is only in
putting a stop to the running of the interest due because the principal of the just
compensation due has been paid. To close our eyes to these realities is to condone
what is effectively a confiscatory action in favor of the LBP.
That the legal interest due is now almost equivalent to the principal to be
paid is not per se an inequitable or unconscionable situation, considering the length
of time the interest has remained unpaid almost twelve long years. From the
perspective of interest income, twelve years would have been sufficient for the
petitioners to double the principal, even if invested conservatively, had they been
promptly paid the principal of the just compensation due them. Moreover, the
interest, however enormous it may be, cannot be inequitable and
unconscionable because it resulted directly from the application of law and
jurisprudence standards that have taken into account fairness and equity in setting
the interest rates due for the use or forebearance of money.
If the LBP sees the total interest due to be immense, it only has itself to
blame, as this interest piled up because it unreasonably acted in its valuation of the
landholdings and consequently failed to promptly pay the petitioners. To be sure,
the consequences of this failure i.e., the enormity of the total interest due and the
alleged financial hemorrhage the LBP may suffer should not be the very reason
that would excuse it from full compliance. To so rule is to use extremely flawed
logic. To so rule is to disregard the question of how the LBP, a government
financial institution that now professes difficulty in paying interest at 12% per
annum, managed the funds that it failed to pay the petitioners for twelve long
years.
It would be utterly fallacious, too, to argue that this Court should tread
lightly in imposing liabilities on the LBP because this bank represents the
government and, ultimately, the public interest. Suffice it to say that public interest
refers to what will benefit the public, not necessarily the government and its
agencies whose task is to contribute to the benefit of the public. Greater public
benefit will result if government agencies like the LBP are conscientious in
undertaking its tasks in order to avoid the situation facing it in this case. Greater
public interest would be served if it can contribute to the credibility of the
governments land reform program through the conscientious handling of its
part of this program.
As our last point, equity and equitable principles only come into full play
when a gap exists in the law and jurisprudence. [34] As we have shown above,
established rulings of this Court are in place for full application to the present
case. There is thus no occasion for the equitable consideration that Justice Chico-
Nazario suggested.
As borne by the records, the 12% interest claimed is only on the difference
between the price of the expropriated lands (determined with finality to
be P1,383,179,000.00) and the amount of P411,769,168.32 already paid to the
petitioners. The difference between these figures amounts to the remaining balance
of P971,409,831.68 that was only paid on May 9, 2008.
As above discussed, this amount should bear interest at the rate of 12%
per annum from the time the petitioners properties were taken on December
9, 1996 up to the time of payment. At this rate, the LBP now owes the petitioners
the total amount of One Billion Three Hundred Thirty-One Million One Hundred
Twenty-Four Thousand Two Hundred Twenty-Three and 05/100 Pesos
(P1,331,124,223.05), computed as follows:
P1,331,124,223.05[35]
However, this Court has relaxed this rule in order to serve substantial
justice considering (a) matters of life, liberty, honor or property,(b) the
existence of special or compelling circumstances, (c) the merits of the case, (d)
a cause not entirely attributable to the fault or negligence of the party favored by
the suspension of the rules, (e) a lack of any showing that the review sought is
merely frivolous and dilatory, and (f) the other party will not be unjustly
prejudiced thereby.
As duly noted in the above discussions, this issue is not one of first
impression in our jurisdiction; the consequences of delay in the payment of just
compensation have been settled by this Court in past rulings. Our settled
jurisprudence on the issue alone accords this case primary importance as a contrary
ruling would unsettle, on the flimsiest of grounds, all the rulings we have
established in the past.
The Rules of Court was conceived and promulgated to set forth guidelines
in the dispensation of justice but not to bind and chain the hand that dispenses it,
for otherwise, courts will be mere slaves to or robots of technical rules, shorn of
judicial discretion. That is precisely why courts in rendering justice have always
been, as they ought to be, conscientiously guided by the norm that when on the
balance, technicalities take a backseat against substantive rights, and not the
other way around. Truly then, technicalities, in the appropriate language of
Justice Makalintal, "should give way to the realities of the situation. [54] [Emphasis
supplied.]
Attorneys Fees
We are fully aware that the RTC has awarded the petitioners attorneys fees
when it fixed the just compensation due and decreed that interest of 12% should be
paid on the balance outstanding after the taking of the petitioners landholdings
took place. The petitioners, however, have not raised the award of attorneys fees as
an issue in the present motion for reconsideration. For this reason, we shall not
touch on this issue at all in this Resolution.
WHEREFORE, premises considered, we GRANT the petitioners motion
for reconsideration. The Court En Bancs Resolution dated December 4, 2009, as
well as the Third Divisions Resolutions dated April 30, 2008 and December 19,
2007, are herebyREVERSED and SET ASIDE.
SO ORDERED.
ARTURO D. BRION
Associate Justice
WE CONCUR:
RENATO C. CORONA
Chief Justice
(on leave)
DIOSDADO M. PERALTA
TERESITA J. LEONARDO-DE CASTRO Associate Justice
Associate Justice
CERTIFICATION
RENATO C. CORONA
Chief Justice
*
On wellness leave.
**
On leave.
***
On wellness leave.
[1]
While the petitioners owned a total of 1,454.8791 hectares based on the landholdings stated in this Courts
February 6, 2007 Decision, the RTC, in its decision, fixed just compensation for 1,388.6027 hectares of land.
[2]
Retired from the Court on December 5, 2009.
[3]
See Masikip v. City of Pasig, G.R. No. 136349, January 23, 2006, 479 SCRA 391, citing Visayan Refining Co. v.
Camus, 40 Phil. 550, 558-559 (1919).
[4]
See Manapat v. Court of Appeals, G.R. Nos. 110478, 116176 and 116491-503, October 15, 2007, 536 SCRA 32.
[5]
See Heirs of Alberto Saguitan v. City of Mandaluyong, G.R. No. 135087, March 14, 2000, 328 SCRA 137.
[6]
Id., citing City of Manila v. Chinese Community of Manila, 40 Phil. 349 (1919).
[7]
The authority to exercise the power of eminent domain was expressly conferred to the Philippine Government
through Section 63 of the Philippine Bill of 1902, which states:
That the Government of the Philippine Islands is hereby authorized, subject to the limitations and
conditions prescribed in this Act, to acquire, require, hold, maintain, and convey title to real and
personal property, and may acquire real estate for public uses by the exercise of the right of
eminent domain. (Act of Congress of July 1, 1902.)
Section 74 of the same law, which deals with the authority of the Philippine Government to grant franchises and
concessions, provides:
That the Government of the Philippine Islands may grant franchises, privileges, and concessions,
including the authority to exercise the right of eminent domain for the construction and
operation of works of public utility and service x x x: Provided, That no private property shall
be taken for any purpose under this section without just compensation paid or tendered
therefor x x x.
More specifically, Section 3 of the Jones Act (of 1916) provides that [p]rivate property shall not be taken for public
use without just compensation.
See Visayan Refining Co. v. Camus, supra note 3.
[8]
We derived the concept of just compensation from the last clause of the Fifth Amendment to the United States
Constitution, which reads: No person shall be held to answer for a capital, or otherwise infamous crime, unless on
a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia,
when in actual service in time of War or public danger; nor shall any person be subject for the same offence to be
twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself,
nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for
public use, without just compensation.
The Fifth Amendment does not prohibit the government from taking its citizens' property; rather, it merely prohibits
the government from taking property without paying just compensation. (26 Am. Jur. 2d Eminent Domain 3,
citing Diamond Bar Cattle Co. v. U.S., 168 F.3d 1209 [10th Cir. 1999].) It is designed to secure compensation, not
to limit governmental interference with property rights. (Id., citing Preseault v. I.C.C., 494 U.S. 1, 110 S. Ct. 914,
108 L. Ed. 2d 1 [1990].) It prevents the legislature (and other government actors) from depriving private persons
of vested property rights except for a "public use" and upon payment of "just compensation." (Id., citing Landgraf
v. USI Film Products, 511 U.S. 244, 114 S. Ct. 1522, 128 L. Ed. 2d 229 [1994].)
[9]
G.R. No. 157206, June 27, 2008, 556 SCRA 102, 116-117.
[10]
Id.
[11]
P86,900,925.88 for the land of AFC and P164,478,178.14 for HPI.
[12]
Land Bank v. Rodriguez, G.R. No. 148892, May 6, 2010.
[13]
Land Bank of the Philippines v. Orilla, supra note 9, at 117.
[14]
G.R. No. 146587, July 2, 2002, 383 SCRA 611.
[15]
Id. at 622-623.
[16]
G. R. Nos. 60225-26, May 8, 1992, 208 SCRA 542.
[17]
In Eastern Shipping Lines, Inc. v. Court of Appeals (G.R. No. 97412, July 12, 1994, 234 SCRA 78), we said:
1. When the obligation is breached, and it consists in the payment of a sum of money, i.e., a
loan or forbearance of money, the interest due should be that which may have been stipulated in
writing. Furthermore, the interest due shall itself earn legal interest from the time it is judicially
demanded. In the absence of stipulation, the rate of interest shall be 12% per annum to be
computed from default, i.e., from judicial or extrajudicial demand under and subject to the
provisions of Article 1169 of the Civil Code.
2. When an obligation, not constituting a loan or forbearance of money, is breached, an interest on
the amount of damages awarded may be imposed at the discretion of the court at the rate of
6% per annum.No interest, however, shall be adjudged on unliquidated claims or damages except
when or until the demand can be established with reasonable certainty. Accordingly, where the
demand is established with reasonable certainty, the interest shall begin to run from the time the
claim is made judicially or extrajudicially (Art. 1169, Civil Code) but when such certainty cannot
be so reasonably established at the time the demand is made, the interest shall begin to run only
from the date the judgment of the court is made (at which time the quantification of damages may
be deemed to have been reasonably ascertained). The actual base for the computation of legal
interest shall, in any case, be on the amount finally adjudged.
3. When the judgment of the court awarding a sum of money becomes final and executory, the rate
of legal interest, whether the case falls under paragraph 1 or paragraph 2, above, shall be 12% per
annum from such finality until its satisfaction, this interim period being deemed to be by then an
equivalent to a forbearance of credit.
[18]
Supra note 12.
[19]
G.R. No. 147511, January 20, 2003, 395 SCRA 494.
[20]
G.R. No. 140160, January 13, 2004, 419 SCRA 67.
[21]
G.R. No. 147245, March 31, 2005, 454 SCRA 516.
[22]
G.R. No. 157753, February 12, 2007, 515 SCRA 449.
[23]
G.R. No. 173392, August 24, 2007, 531 SCRA 198.
[24]
G.R. No. 154211-12, June 22, 2009, 590 SCRA 214.
[25]
Province of Tayabas v. Perez, 66 Phil. 467; J.M. Tuazon & Co., Inc. v. Land Tenure Administration, No. L-21064,
February 18, 1970, 31 SCRA 413; Municipality of Daet v. Court of Appeals, No. L-35861, October 18, 1979, 93
SCRA 503; Manotok v. National Housing Authority, No. L-55166, May 21, 1987, 150 SCRA 89.
[26]
Supra note 14.
[27]
Supra note 19.
[28]
Supra note 22.
[29]
Supra note 14.
[30]
Decreeing the Emancipation of Tenants from the Bondage of the Soil, Transferring to Them the Ownership of the
Land They Till and Providing the Instruments and Mechanisms Therefor.
[31]
Rules and Regulations Governing the Grant of Increment of Six Percent (6%) Yearly Interest Compounded
Annually on Lands Covered by Presidential Decree No. 27 and Executive Order No. 228 (Effective October 21,
1994). Amended by DAR AO No. 02, series of 2004 (Issued on November 4, 2004).
[32]
Article 1229 states: The judge shall equitably reduce the penalty when the principal obligation has been partly or
irregularly complied with by the debtor.
[33]
Republic v. Juan, G.R. No. L-24740, July 30, 1979, 92 SCRA 26; citing 30 CJS 230.
[34]
See Parent-Teachers Association of St. Mathew Christian Academy v. Metropolitan Bank and Trust Co., G.R. No.
176518, March 2, 2010, citing Tirazona v. Philippine EDS Techno-Service, Inc. (PET, Inc.), G.R. No. 169712,
January 20, 2009, 576 SCRA 625, 626.
[35]
Rollo, p. 1337.
[36]
Equitable Banking Corp. v. Sadac, G.R. No. 164772, June 8, 2006, 490 SCRA 380, 416-417.
[37]
G.R. No. 82467, June 29, 1989, 174 SCRA 510.
[38]
G.R. No. L-72670, September 12, 1986, 144 SCRA 43.
[39]
G.R. No. L-63318, August 18, 1984, 131 SCRA 200.
[40]
G.R. No. L-26112, October 4, 1971, 41 SCRA 422.
[41]
G.R. No. L-58011, November 18, 1983, 125 SCRA 577.
[42]
G.R No. L-64276, August 12, 1986, 143 SCRA 396.
[43]
G.R. No. L-18452, May 20, 1966, 17 SCRA 207.
[44]
G.R. No. 125451, January 20, 2000, 322 SCRA 741.
[45]
434 Phil. 753 (2002).
[46]
G.R. No. 162335, December 18, 2008, 574 SCRA 468.
[47]
482 Phil. 903 (2004).
[48]
Id. at 915.
[49]
Oral arguments at the Supreme Court, Hacienda Luisita case, G.R. No. 171101, August 26, 2010.