CITY OF MANILA VS.

CHINESE
COMMUNITY OF MANILA, digested
40 Phil. 349 (Constitutional Law – Eminent Domain)
FACTS: Plaintiff sought to expropriate a part of a private cemetery devoted for public use to
make an extension of Rizal Avenue. Defendants contend that expropriation is not necessary
because it will disturb the remains of the dead. Moreover, adjoining and adjacent lots were
offered to the city free of charge for the planned public improvement.

ISSUE: Whether or not a private property devoted for public use can still be expropriated.

HELD: Yes, private property devoted for public use is still subject to expropriation, provided
this is done directly by the national legislature or under a specific grant of authority to the
delegate. In addition, there must be a necessity for the expropriation. In the case at bar,
evidence shows that there is no proof of the need of converting the cemetery.

G.R. No. L-14355 October 31, 1919

THE CITY OF MANILA, plaintiff-appellant,

vs.
CHINESE COMMUNITY OF MANILA, ET AL., defendants-appellees.

City Fiscal Diaz for appellant.

Crossfield and O'Brien, Williams, Ferrier and Sycip, Delgado and Delgado, Filemon Sotto, and
Ramon Salinas for appellees.

JOHNSON, J.:

The important question presented by this appeal is: In expropriation proceedings by the city of
Manila, may the courts inquire into, and hear proof upon, the necessity of the expropriation?

That question arose in the following manner:

On the 11th day of December, 1916, the city of Manila presented a petition in the Court of First
Instance of said city, praying that certain lands, therein particularly described, be expropriated for the
purpose of constructing a public improvement. The petitioner, in the second paragraph of the
petition, alleged:

That for the purpose of constructing a public improvement, namely, the extension of Rizal
Avenue, Manila, it is necessary for the plaintiff to acquire ownership in fee simple of certain
 parcels of land situated in the district of Binondo of said city within Block 83 of said district,
and within the jurisdiction of this court.

The defendant, the Comunidad de Chinos de Manila [Chinese Community of Manila], answering the
petition of the plaintiff, alleged that it was a corporation organized and existing under and by virtue of
the laws of the Philippine Islands, having for its purpose the benefit and general welfare of the
Chinese Community of the City of Manila; that it was the owner of parcels one and two of the land
described in paragraph 2 of the complaint; that it denied that it was either
necessary or expedient that the said parcels be expropriated for street purposes; that existing street
and roads furnished ample means of communication for the public in the district covered by such
proposed expropriation; that if the construction of the street or road should be considered a public
necessity, other routes were available, which would fully satisfy the plaintiff's purposes, at much less
expense and without disturbing the resting places of the dead; that it had a Torrens title for the lands
in question; that the lands in question had been used by the defendant for cemetery purposes; that a
great number of Chinese were buried in said cemetery; that if said expropriation be carried into
effect, it would disturb the resting places of the dead, would require the expenditure of a large sum of
money in the transfer or removal of the bodies to some other place or site and in the purchase of
such new sites, would involve the destruction of existing monuments and the erection of new
monuments in their stead, and would create irreparable loss and injury to the defendant and to all
those persons owning and interested in the graves and monuments which would have to be
destroyed; that the plaintiff was without right or authority to expropriate said cemetery or any part or
portion thereof for street purposes; and that the expropriation, in fact, was not necessary as a public
improvement.

The defendant Ildefonso Tambunting, answering the petition, denied each and every allegation of the
complaint, and alleged that said expropriation was not a public improvement; that it was not
necessary for the plaintiff to acquire the parcels of land in question; that a portion of the lands in
question was used as a cemetery in which were the graves of his ancestors; that monuments and
tombstones of great value were found thereon; that the land had becomequasi-public property of a
benevolent association, dedicated and used for the burial of the dead and that many dead were
buried there; that if the plaintiff deemed it necessary to extend Rizal Avenue, he had offered and still
offers to grant a right of way for the said extension over other land, without cost to the plaintiff, in
order that the sepulchers, chapels and graves of his ancestors may not be disturbed; that the land
so offered, free of charge, would answer every public necessity on the part of the plaintiff.

The defendant Feliza Concepcion de Delgado, with her husband, Jose Maria Delgado, and each of
the other defendants, answering separately, presented substantially the same defense as that
presented by the Comunidad de Chinos de Manila and Ildefonso Tambunting above referred to.

The foregoing parts of the defense presented by the defendants have been inserted in order to show
the general character of the defenses presented by each of the defendants. The plaintiff alleged that
the expropriation was necessary. The defendants each alleged (a) that no necessity existed for said
expropriation and (b) that the land in question was a cemetery, which had been used as such for
many years, and was covered with sepulchres and monuments, and that the same should not be
converted into a street for public purposes.

Upon the issue thus presented by the petition and the various answers, the Honorable Simplicio del
Rosario, judge, in a very elucidated opinion, with very clear and explicit reasons, supported by
ambulance of authorities, decided that there was no necessity for the expropriation of the particular
strip of land in question, and absolved each and all of the defendants from all liability under the
complaint, without any finding as to costs.
From that judgment the plaintiff appealed and presented the above question as its principal ground
of appeal.

The theory of the plaintiff is, that once it has established the fact, under the law, that it
has authority to expropriate land, it may expropriate any land it may desire; that the only function of
the court in such proceedings is to ascertain the value of the land in question; that neither the court
nor the owners of the land can inquire into the advisible purpose of purpose of the expropriation or
ask any questions concerning the necessities therefor; that the courts are mere appraisers of the
land involved in expropriation proceedings, and, when the value of the land is fixed by the method
adopted by the law, to render a judgment in favor of the defendant for its value.

That the city of Manila has authority to expropriate private lands for public purposes, is not denied.
Section 2429 of Act No. 2711 (Charter of the city of Manila) provides that "the city (Manila) . . . may
condemn private property forpublic use."

The Charter of the city of Manila contains no procedure by which the said authority may be carried
into effect. We are driven, therefore, to the procedure marked out by Act No. 190 to ascertain how
the said authority may be exercised. From an examination of Act No. 190, in its section 241, we
find how the right of eminent domain may be exercised. Said section 241 provides that, "The
Government of the Philippine Islands, or of any province or department thereof, or of
any municipality, and any person, or public or private corporation having, by law, the right to
condemn private property for public use, shall exercise that right in the manner hereinafter
prescribed."

Section 242 provides that a complaint in expropriation proceeding shall be presented; that the
complaint shall state with certainty the right of condemnation, with a description of the property
sought to be condemned together with the interest of each defendant separately.

Section 243 provides that if the court shall find upon trial that the right to expropriate the land in
question exists, it shall then appoint commissioners.

Sections 244, 245 and 246 provide the method of procedure and duty of the commissioners. Section
248 provides for an appeal from the judgment of the Court of First Instance to the Supreme Court.
Said section 248 gives the Supreme Court authority to inquire into the right of expropriation on the
part of the plaintiff. If the Supreme Court on appeal shall determine that no right of expropriation
existed, it shall remand the cause to the Court of First Instance with a mandate that the defendant be
replaced in the possession of the property and that he recover whatever damages he may have
sustained by reason of the possession of the plaintiff.

It is contended on the part of the plaintiff that the phrase in said section, "and if the court shall find
the right to expropriate exists," means simply that, if the court finds that there is some
law authorizing the plaintiff to expropriate, then the courts have no other function than to authorize
the expropriation and to proceed to ascertain the value of the land involved; that the necessity for the
expropriation is a legislative and not a judicial question.

Upon the question whether expropriation is a legislative function exclusively, and that the courts
cannot intervene except for the purpose of determining the value of the land in question, there is
much legal legislature. Much has been written upon both sides of that question. A careful
examination of the discussions pro and con will disclose the fact that the decisions depend largely
upon particular constitutional or statutory provisions. It cannot be denied, if the legislature under
proper authority should grant the expropriation of a certain or particular parcel of land for some
specified public purpose, that the courts would be without jurisdiction to inquire into the purpose of
that legislation.

If, upon the other hand, however, the Legislature should grant general authority to a municipal
corporation to expropriate private land for public purposes, we think the courts have ample authority
in this jurisdiction, under the provisions above quoted, to make inquiry and to hear proof, upon an
issue properly presented, concerning whether or not the lands were private and whether the purpose
was, in fact, public. In other words, have no the courts in this jurisdiction the right, inasmuch as the
questions relating to expropriation must be referred to them (sec. 241, Act No. 190) for final decision,
to ask whether or not the law has been complied with? Suppose in a particular case, it should be
denied that the property is not private property but public, may not the courts hear proof upon that
question? Or, suppose the defense is, that the purpose of the expropriation is not public but private,
or that there exists no public purpose at all, may not the courts make inquiry and hear proof upon
that question?

The city of Manila is given authority to expropriate private lands for public purposes. Can it be
possible that said authority confers the right to determine for itself that the land is private and that the
purpose is public, and that the people of the city of Manila who pay the taxes for its support,
especially those who are directly affected, may not question one or the other, or both, of these
questions? Can it be successfully contended that the phrase used in Act No. 190, "and if the court
upon trial shall find that such right exists," means simply that the court shall examine thestatutes
simply for the purpose of ascertaining whether a law exists authorizing the petitioner to exercise the
right of eminent domain? Or, when the case arrives in the Supreme Court, can it be possible that the
phrase, "if the Supreme Court shall determine that no right of expropriation exists," that that simply
means that the Supreme Court shall also examine the enactments of the legislature for the purpose
of determining whether or not a law exists permitting the plaintiff to expropriate?

We are of the opinion that the power of the court is not limited to that question. The right of
expropriation is not an inherent power in a municipal corporation, and before it can exercise the right
some law must exist conferring the power upon it. When the courts come to determine the question,
they must only find (a) that a law or authority exists for the exercise of the right of eminent domain,
but (b) also that the right or authority is being exercised in accordance with the law. In the present
case there are two conditions imposed upon the authority conceded to the City of Manila: First, the
land must be private; and, second, the purpose must be public. If the court, upon trial, finds that
neither of these conditions exists or that either one of them fails, certainly it cannot be contended
that the right is being exercised in accordance with law.

Whether the purpose for the exercise of the right of eminent domain is public, is a question of fact.
Whether the land is public, is a question of fact; and, in our opinion, when the legislature conferred
upon the courts of the Philippine Islands the right to ascertain upon trial whether the right exists for
the exercise of eminent domain, it intended that the courts should inquire into, and hear proof upon,
those questions. Is it possible that the owner of valuable land in this jurisdiction is compelled to stand
mute while his land is being expropriated for a use not public, with the right simply to beg the city of
Manila to pay him the value of his land? Does the law in this jurisdiction permit municipalities to
expropriate lands, without question, simply for the purpose of satisfying the aesthetic sense of those
who happen for the time being to be in authority? Expropriation of lands usually calls for public
expense. The taxpayers are called upon to pay the costs. Cannot the owners of land question
the public use or the public necessity?

As was said above, there is a wide divergence of opinion upon the authority of the court to question
the necessity or advisability of the exercise of the right of eminent domain. The divergence is usually
found to depend upon particular statutory or constitutional provisions.
It has been contended — and many cases are cited in support of that contention, and section 158 of
volume 10 of Ruling Case Law is cited as conclusive — that the necessity for taking property under
the right of eminent domain is not a judicial question. But those who cited said section evidently
overlooked the section immediately following (sec. 159), which adds: "But it is obvious that if the
property is taken in the ostensible behalf of a public improvementwhich it can never by any
possibility serve, it is being taken for a use not public, and the owner's constitutional rights call for
protection by the courts. While many courts have used sweeping expression in the decisions in
which they have disclaimed the power of supervising the power of supervising the selection of the
sites of public improvements, it may be safely said that the courts of the various states would feel
bound to interfere to prevent an abuse of the discretion delegated by the legislature, by an attempted
appropriation of land in utter disregard of the possible necessity of its use, or when the alleged
purpose was a cloak to some sinister scheme." (Norwich City vs. Johnson, 86 Conn., 151; Bell vs.
Mattoon Waterworks, etc. Co., 245 Ill., 544; Wheeling, etc. R. R. Co. vs. Toledo Ry. etc. Co., 72 Ohio
St., 368; State vs. Stewart, 74 Wis., 620.)

Said section 158 (10 R. C. L., 183) which is cited as conclusive authority in support of the contention
of the appellant, says:

The legislature, in providing for the exercise of the power of eminent domain, may directly
determine the necessity for appropriating private property for a particular improvement for
public use, and it may select the exact location of the improvement. In such a case, it is well
settled that the utility of the proposed improvement, the extent of the public necessity for its
construction, the expediency of constructing it, the suitableness of the location selected and
the consequent necessity of taking the land selected for its site, are all questions exclusively
for the legislature to determine, and the courts have no power to interfere, or to substitute
their own views for those of the representatives of the people.

Practically every case cited in support of the above doctrine has been examined, and we are justified
in making the statement that in each case the legislature directly determined the necessity for the
exercise of the right of eminent domain in the particular case. It is not denied that if the necessity for
the exercise of the right of eminent domain is presented to the legislative department of the
government and that department decides that there exists a necessity for the exercise of the right in
a particular case, that then and in that case, the courts will not go behind the action of the legislature
and make inquiry concerning the necessity. But, in the case of Wheeling, etc. R. R. Co. vs. Toledo,
Ry, etc., Co. (72 Ohio St., 368 [106 Am. St. rep., 622, 628]), which was cited in support of the
doctrine laid down in section 158 above quoted, the court said:

But when the statute does not designate the property to be taken nor how may be taken,
then the necessity of taking particular property is a question for the courts. Where the
application to condemn or appropriate is made directly to the court, the question (of
necessity) should be raised and decided in limene.

The legislative department of the government was rarely undertakes to designate the precise
property which should be taken for public use. It has generally, like in the present case, merely
conferred general authority to take land for public use when a necessity exists therefor. We believe
that it can be confidently asserted that, under such statute, the allegation of the necessity for the
appropriation is an issuable allegation which it is competent for the courts to decide.
(Lynch vs. Forbes, 161 Mass., 302 [42 Am. St. Rep., 402, 407].)

There is a wide distinction between a legislative declaration that a municipality is given authority to
exercise the right of eminent domain, and a decision by the municipality that there exist a necessity
for the exercise of that right in a particular case. The first is a declaration simply that there exist
reasons why the right should be conferred upon municipal corporation, while the second is the
application of the right to a particular case. Certainly, the legislative declaration relating to the
advisability of granting the power cannot be converted into a declaration that a necessity exists for
its exercise in a particular case, and especially so when, perhaps, the land in question was not within
the territorial authority was granted.

Whether it was wise, advisable, or necessary to confer upon a municipality the power to exercise the
right of eminent domain, is a question with which the courts are not concerned. But when that right
or authority is exercised for the purpose of depriving citizens of their property, the courts are
authorized, in this jurisdiction, to make inquiry and to hear proof upon the necessity in the particular
case, and not the general authority.

Volume 15 of the Cyclopedia of Law and Procedure (Cyc.), page 629, is cited as a further conclusive
authority upon the question that the necessity for the exercise of the right of eminent domain is a
legislative and not a judicial question. Cyclopedia, at the page stated, says:

In the absence of some constitutional or statutory provision to the contrary,

the necessity and expediency of exercising the right of eminent domain are questions
essentially political and not judicial in their character. The determination of those questions
(the necessity and the expediency) belongs to the sovereign power; the legislative
department is final and conclusive, and the courts have no power to review it (the necessity
and the expediency) . . . . It (the legislature) may designate the particular property to be
condemned, and its determination in this respect cannot be reviewed by the courts.

The volume of Cyclopedia, above referred to, cites many cases in support of the doctrine quoted.
While time has not permitted an examination of all of said citations, many of them have been
examined, and it can be confidently asserted that said cases which are cited in support of the
assertion that, "the necessity and expediency of exercising the right of eminent domain are
questions essentially political and not judicial," show clearly and invariably that in each case the
legislature itself usually, by a special law, designated the particular case in which the right of eminent
domain might be exercised by the particular municipal corporation or entity within the state. (Eastern
R. Co. vs.Boston, etc., R. Co., 11 Mass., 125 [15 Am. Rep., 13]; Brooklyn Park
Com'rs vs. Armstrong, 45 N.Y., 234 [6 Am. Rep., 70]; Hairston vs. Danville, etc. Ry. Co., 208 U. S.
598; Cincinnati vs. Louisville, etc. Ry. Co., 223 U. S., 390; U.S. vs. Chandler-Dunbar Water Power
Co., 229 U. S., 53; U.S. vs. Gettysburg, etc. Co., 160 U. S., 668; Traction Co. vs. Mining Co., 196
U.S., 239; Sears vs. City of Akron, 246 U.S., 351 [erroneously cited as 242 U.S.].)

In the case of Traction Co. vs. Mining Co. (196 U.S., 239), the Supreme Court of the United States
said: "It is erroneous to suppose that the legislature is beyond the control of the courts in exercising
the power of eminent domain, either as to the nature of the use or the necessity to the use of any
particular property. For if the use be not public or no necessity for the taking exists, the legislature
cannot authorize the taking of private property against the will of the owner, notwithstanding
compensation may be required."

In the case of School Board of Carolina vs. Saldaña (14 Porto Rico, 339, 356), we find the Supreme
Court of Porto Rico, speaking through Justice MacLeary, quoting approvingly the following, upon the
question which we are discussing: "It is well settled that although the legislature must necessarily
determine in the first instance whether the use for which they (municipalities, etc.) attempt to
exercise the power is a public one or not, their (municipalities, etc.) determination is not final, but is
subject to correction by the courts, who may undoubtedly declare the statute unconstitutional, if it
shall clearly appear that the use for which it is proposed to authorize the taking of private property is
in reality not public but private." Many cases are cited in support of that doctrine.
Later, in the same decision, we find the Supreme Court of Porto Rico says: "At any rate, the rule is
quite well settled that in the cases under consideration the determination of the necessity of taking
a particular piece or a certain amount of land rests ultimately with the courts." (Spring Valley etc.
Co. vs. San Mateo, etc. Co., 64 Cal., 123.) .

In the case of Board of Water Com'rs., etc. vs. Johnson (86 Conn., 571 [41 L. R. A., N. S., 1024]),
the Supreme Court of Connecticut approvingly quoted the following doctrine from Lewis on Eminent
Domain (3d ed.), section 599: "In all such cases the necessity of public utility of the proposed work
or improvement is a judicial question. In all such cases, where the authority is to take property
necessary for the purpose, the necessity of taking particular property for a particular purpose is a
judicial one, upon which the owner is entitled to be heard." (Riley vs.Charleston, etc. Co., 71 S. C.,
457, 489 [110 Am. St. Rep., 579]; Henderson vs. Lexington 132 Ky., 390, 403.)

The taking of private property for any use which is not required by the necessities or convenience of
the inhabitants of the state, is an unreasonable exercise of the right of eminent domain, and beyond
the power of the legislature to delegate. (Bennett vs. Marion, 106 Iowa, 628, 633;
Wilson vs. Pittsburg, etc. Co., 222 Pa. St., 541, 545; Greasy, etc. Co. vs. Ely, etc. Co., 132 Ky., 692,
697.)

In the case of New Central Coal Co. vs. George's etc. Co. (37 Md., 537, 564), the Supreme Court of
the State of Maryland, discussing the question before us, said: "To justify the exercise of this
extreme power (eminent domain) where the legislature has left it to depend upon the necessity that
may be found to exist, in order to accomplish the purpose of the incorporation, as in this case, the
party claiming the right to the exercise of the power should be required to show at least a reasonable
degree of necessity for its exercise. Any rule less strict than this, with the large and almost
indiscriminate delegation of the right to corporations, would likely lead to oppression and the
sacrifice of private right to corporate power."

In the case of Dewey vs. Chicago, etc. Co. (184 Ill., 426, 433), the court said: "Its right to condemn
property is not a general power of condemnation, but is limited to cases where a necessity for resort
to private property is shown to exist. Such necessity must appear upon the face of the petition to
condemn. If the necessary is denied the burden is upon the company (municipality) to establish it."
(Highland, etc. Co. vs. Strickley, 116 Fed., 852, 856; Kiney vs.Citizens' Water & Light Co., 173 Ind.,
252, 257 ; Bell vs. Mattoon Waterworks, etc. Co., 245 Ill., 544 [137 Am. St. Rep. 338].)

It is true that naby decisions may be found asserting that what is a public use is a legislative
question, and many other decisions declaring with equal emphasis that it is a judicial question. But,
as long as there is a constitutional or statutory provision denying the right to take land for any use
other than a public use, it occurs to us that the question whether any particular use is a public one or
not is ultimately, at least, a judicial question. The legislative may, it is true, in effect declare certain
uses to be public, and, under the operation of the well-known rule that a statute will not be declared
to be unconstitutional except in a case free, or comparatively free, from doubt, the courts will
certainly sustain the action of the legislature unless it appears that the particular use is clearly not of
a public nature. The decisions must be understood with this limitation; for, certainly, no court of last
resort will be willing to declare that any and every purpose which the legislative might happen to
designate as a public use shall be conclusively held to be so, irrespective of the purpose in question
and of its manifestly private character Blackstone in his Commentaries on the English Law remarks
that, so great is the regard of the law for private property that it will not authorize the least violation of
it, even for the public good, unless there exists a very great necessity therefor.

In the case of Wilkinson vs. Leland (2 Pet. [U.S.], 657), the Supreme Court of the United States said:
"That government can scarcely be deemed free where the rights of property are left solely defendant
on the legislative body, without restraint. The fundamental maxims of free government seem to
require that the rights of personal liberty and private property should be held sacred. At least no
court of justice in this country would be warranted in assuming that the power to violate and
disregard them — a power so repugnant to the common principles of justice and civil liberty —
lurked in any general grant of legislature authority, or ought to be implied from any general
expression of the people. The people ought no to be presumed to part with rights so vital to their
security and well-being without very strong and direct expression of such intention." (Lewis on
Eminent Domain, sec. 603; Lecoul vs.Police Jury 20 La. Ann., 308; Jefferson vs. Jazem, 7 La. Ann.,
182.)

Blackstone, in his Commentaries on the English Law said that the right to own and possess land —
a place to live separate and apart from others — to retain it as a home for the family in a way not to
be molested by others — is one of the most sacred rights that men are heirs to. That right has been
written into the organic law of every civilized nation. The Acts of Congress of July 1, 1902, and of
August 29, 1916, which provide that "no law shall be enacted in the Philippine Islands which shall
deprive any person of his property without due process of law," are but a restatement of the time-
honored protection of the absolute right of the individual to his property. Neither did said Acts of
Congress add anything to the law already existing in the Philippine Islands. The Spaniard fully
recognized the principle and adequately protected the inhabitants of the Philippine Islands against
the encroachment upon the private property of the individual. Article 349 of the Civil Code provides
that: "No one may be deprived of his property unless it be by competent authority, for some purpose
of proven public utility, and after payment of the proper compensation Unless this requisite (proven
public utility and payment) has been complied with, it shall be theduty of the courts to protect the
owner of such property in its possession or to restore its possession to him , as the case may be."

The exercise of the right of eminent domain, whether directly by the State, or by its authorized
agents, is necessarily in derogation of private rights, and the rule in that case is that the authority
must be strictly construed. No species of property is held by individuals with greater tenacity, and
none is guarded by the constitution and laws more sedulously, than the right to the freehold of
inhabitants. When the legislature interferes with that right, and, for greater public purposes,
appropriates the land of an individual without his consent, the plain meaning of the law should not be
enlarged by doubtly interpretation. (Bensely vs. Mountainlake Water Co., 13 Cal., 306 and cases
cited [73 Am. Dec., 576].)

The statutory power of taking property from the owner without his consent is one of the most delicate
exercise of government authority. It is to be watched with jealous scrutiny. Important as the power
may be to the government, the inviolable sanctity which all free constitutions attach to the right of
property of the citizens, constrains the strict observance of the substantial provisions of the law
which are prescribed as modes of the exercise of the power, and to protect it from abuse. Not only
must the authority of municipal corporations to take property be expressly conferred and the use for
which it is taken specified, but the power, with all constitutional limitation and directions for its
exercise, must be strictly pursued. (Dillon on Municipal Corporations [5th Ed.], sec. 1040, and cases
cited; Tenorio vs. Manila Railroad Co., 22 Phil., 411.)

It can scarcely be contended that a municipality would be permitted to take property for some public
use unless some public necessity existed therefor. The right to take private property for public use
originates in the necessity, and the taking must be limited by such necessity. The appellant contends
that inasmuch as the legislature has given it general authority to take private property for public use,
that the legislature has, therefore, settled the question of the necessity in every case and that the
courts are closed to the owners of the property upon that question. Can it be imagined, when the
legislature adopted section 2429 of Act No. 2711, that it thereby declared that it was necessary to
appropriate the property of Juan de la Cruz, whose property, perhaps, was not within the city limits at
the time the law was adopted? The legislature, then, not having declared the necessity, can it be
contemplated that it intended that a municipality should be the sole judge of the necessity in every
case, and that the courts, in the face of the provision that "if upon trial they shall find that a right
exists," cannot in that trial inquire into and hear proof upon the necessity for the appropriation in a
particular case?

The Charter of the city of Manila authorizes the taking of private property for public use. Suppose the
owner of the property denies and successfully proves that the taking of his property serves no public
use: Would the courts not be justified in inquiring into that question and in finally denying the petition
if no public purpose was proved? Can it be denied that the courts have a right to inquire into that
question? If the courts can ask questions and decide, upon an issue properly presented, whether the
use is public or not, is not that tantamount to permitting the courts to inquire into the necessity of the
appropriation? If there is no public use, then there is no necessity, and if there is no necessity, it is
difficult to understand how a public use can necessarily exist. If the courts can inquire into the
question whether a public use exists or not, then it seems that it must follow that they can examine
into the question of the necessity.

The very foundation of the right to exercise eminent domain is a genuine necessity, and that
necessity must be of a public character. The ascertainment of the necessity must precede or
accompany, and not follow, the taking of the land. (Morrison vs. Indianapolis, etc. Ry. Co., 166 Ind.,
511; Stearns vs. Barre, 73 Vt., 281; Wheeling, etc. R. R. Co. vs. Toledo, Ry. etc. Co., 72 Ohio St.,
368.)

The general power to exercise the right of eminent domain must not be confused with the right to
exercise it in aparticular case. The power of the legislature to confer, upon municipal corporations
and other entities within the State, general authority to exercise the right of eminent domain cannot
be questioned by the courts, but that general authority of municipalities or entities must not be
confused with the right to exercise it in particular instances. The moment the municipal corporation
or entity attempts to exercise the authority conferred, it must comply with the conditions
accompanying the authority. The necessity for conferring the authority upon a municipal corporation
to exercise the right of eminent domain is admittedly within the power of the legislature. But whether
or not the municipal corporation or entity is exercising the right in a particular case under the
conditions imposed by the general authority, is a question which the courts have the right to inquire
into.

The conflict in the authorities upon the question whether the necessity for the exercise of the right of
eminent domain is purely legislative and not judicial, arises generally in the wisdom and propriety of
the legislature in authorizing the exercise of the right of eminent domain instead of in the question of
the right to exercise it in a particular case. (Creston Waterworks Co. vs. McGrath, 89 Iowa, 502.)

By the weight of authorities, the courts have the power of restricting the exercise of eminent domain
to the actual reasonable necessities of the case and for the purposes designated by the law.
(Fairchild vs. City of St. Paul. 48 Minn., 540.)

And, moreover, the record does not show conclusively that the plaintiff has definitely decided that
their exists a necessity for the appropriation of the particular land described in the complaint.
Exhibits 4, 5, 7, and E clearly indicate that the municipal board believed at one time that other land
might be used for the proposed improvement, thereby avoiding the necessity of distributing the quiet
resting place of the dead.

Aside from insisting that there exists no necessity for the alleged improvements, the defendants
further contend that the street in question should not be opened through the cemetery. One of the
defendants alleges that said cemetery is public property. If that allegations is true, then, of course,
the city of Manila cannot appropriate it for public use. The city of Manila can only
expropriate private property.

It is a well known fact that cemeteries may be public or private. The former is a cemetery used by the
general community, or neighborhood, or church, while the latter is used only by a family, or a small
portion of the community or neighborhood. (11 C. J., 50.)

Where a cemetery is open to public, it is a public use and no part of the ground can be taken for
other public uses under a general authority. And this immunity extends to the unimproved and
unoccupied parts which are held in good faith for future use. (Lewis on Eminent Domain, sec. 434,
and cases cited.)

The cemetery in question seems to have been established under governmental authority. The
Spanish Governor-General, in an order creating the same, used the following language:

The cemetery and general hospital for indigent Chinese having been founded and
maintained by the spontaneous and fraternal contribution of their protector, merchants and
industrials, benefactors of mankind, in consideration of their services to the Government of
the Islands its internal administration, government and regime must necessarily be adjusted
to the taste and traditional practices of those born and educated in China in order that the
sentiments which animated the founders may be perpetually effectuated.

It is alleged, and not denied, that the cemetery in question may be used by the general community of
Chinese, which fact, in the general acceptation of the definition of a public cemetery, would make the
cemetery in question public property. If that is true, then, of course, the petition of the plaintiff must
be denied, for the reason that the city of Manila has no authority or right under the law to expropriate
public property.

But, whether or not the cemetery is public or private property, its appropriation for the uses of a
public street, especially during the lifetime of those specially interested in its maintenance as a
cemetery, should be a question of great concern, and its appropriation should not be made for such
purposes until it is fully established that the greatest necessity exists therefor.

While we do not contend that the dead must not give place to the living, and while it is a matter of
public knowledge that in the process of time sepulchres may become the seat of cities and
cemeteries traversed by streets and daily trod by the feet of millions of men, yet, nevertheless such
sacrifices and such uses of the places of the dead should not be made unless and until it is fully
established that there exists an eminent necessity therefor. While cemeteries and sepulchres and
the places of the burial of the dead are still within
the memory and command of the active care of the living; while they are still devoted to pious uses
and sacred regard, it is difficult to believe that even the legislature would adopt a law expressly
providing that such places, under such circumstances, should be violated.

In such an appropriation, what, we may ask, would be the measure of damages at law, for the
wounded sensibilities of the living, in having the graves of kindred and loved ones blotted out and
desecrated by a common highway or street for public travel? The impossibility of measuring the
damage and inadequacy of a remedy at law is too apparent to admit of argument. To disturb the
mortal remains of those endeared to us in life sometimes becomes the sad duty of the living; but,
except in cases of necessity, or for laudable purposes, the sanctity of the grave, the last resting
place of our friends, should be maintained, and the preventative aid of the courts should be invoked
for that object. (Railroad Company vs. Cemetery Co., 116 Tenn., 400; Evergreen Cemetery
Association vs. The City of New Haven, 43 Conn., 234; Anderson vs. Acheson, 132 Iowa, 744;
Beatty vs. Kurtz, 2 Peters, 566.)

In the present case, even granting that a necessity exists for the opening of the street in question,
the record contains no proof of the necessity of opening the same through the cemetery. The record
shows that adjoining and adjacent lands have been offered to the city free of charge, which will
answer every purpose of the plaintiff.

For all of the foregoing, we are fully persuaded that the judgment of the lower court should be and is
hereby affirmed, with costs against the appellant. So ordered.

Arellano, C.J., Torres, Araullo and Avanceña, JJ., concur.

Separate Opinions

MALCOLM, J., concurring:

The Government of the Philippine Islands is authorized by the Philippine Bill to acquire real estate
for public use by the exercise of the right of eminent domain. (Act of Congress of July 1, 1902, sec.
63.) A portion of this power has been delegated by the Philippine Legislature to the city of Manila,
which is permitted to "condemn private property for public use." (Administrative Code of 1917, sec.
2429.) The Code of Civil Procedure, in prescribing how the right of eminent domain may be
exercised, also limits the condemnation to "private property for public use." (Sec. 241.) As under the
facts actually presented, there can be no question that a public street constitutes a public use, the
only remaining question is whether or not the Chinese Cemetery and the other property here sought
to be taken by the exercise of the right of eminent domain is "private property."

As narrowing our inquiry still further, let it be noted that cemeteries are of two classes, public and
private. A public cemetery is one used by the general community, or neighborhood, or church; while
a private cemetery is one used only by a family, or small portion of a community. (Lay vs. State, 12
Ind. App., 362; Cemetery Association vs.Meninger [1875], 14 Kan., 312.) Our specific question, then,
is, whether the Chinese Cemetery in the city of Manila is a public, or a private graveyard. If it be
found to be the former, it is not subject to condemnation by the city of Manila; if it be found to be the
latter, it is subject to condemnation.

The Chinese Cemetery of Manila was established during the Spanish administration in the
Philippines by public spirited Chinese. The order of the Governor-General giving governmental
recognition to the cemetery reads as follows: "The cemetery and general hospital for indigent
Chinese having been founded and maintained by the spontaneous and fraternal contribution of their
protectors, merchants and industrials, benefactors of mankind, in consideration of their services to
the Government of the Islands, its internal administration, government and regime, must necessarily
be adjusted to the taste and traditional practices of those born and educated in China in order that
the sentiments which animated the founders may be perpetually effectuated." Sometimes after the
inauguration of the new regime in the Philippines, a corporation was organized to control the
cemetery, and a Torrens title for the lands in question was obtained.

From the time of its creation until the present the cemetery has been used by the Chinese
community for the burial of their dead. It is said that not less than four hundred graves, many of them
with handsome monuments, would be destroyed by the proposed street. This desecration is
attempted as to the las t resting places of the dead of a people who, because of their peculiar and
ingrained ancestral workship, retain more than the usual reverence for the departed. These facts
lead us straight to the conclusion that the Chinese Cemetery is not used by a family or a small
portion of a community but by a particular race long existing in the country and of considerable
numbers. The case, then, is one of where the city of Manila, under a general authority permitting it to
condemn private property for public use, is attempting to convert a property already dedicated to a
public use to an entirely different public use; and this, not directly pursuant to legislative authority, but
primarily through the sole advice of the consulting architect.

Two well considered decisions coming from the American state courts on almost identical facts are
worthy of our consideration. The first is the case of The Evergreen Cemetery Association vs. The
City of New Haven ([1875], 43 Conn., 234), of cited by other courts. Here the City of New Haven,
Connecticut, under the general power conferred upon it to lay out, construct, and maintain all
necessary highways within its limits, proceeded to widen and straighten one of its streets and in so
doing took a small piece of land belonging to the Evergreen Cemetery Association. This association
was incorporated under the general statute. The city had no special power to take any part of the
cemetery for such purposes. It was found that the land taken was needed for the purposes of the
cemetery and was not needed for the purpose of widening and straightening the avenue. The court
said that it is unquestionable that the Legislature has the power to authorize the taking of land
already applied to one public use and devote it to another. When the power is granted to municipal
or private corporations in express words, no question can arise. But, it was added, "The same land
cannot properly be used for burial lots and for a public highway at the same time. . . . Land therefore
applied to one use should not be taken for the other except in cases on necessity. . . . There is no
difficulty in effecting the desired improvement by taking land on the other side of the street. . . . The
idea of running a public street, regardless of graves, monuments, and the feelings of the living,
through one of our public cemeteries, would be shocking to the moral sense of the community, and
would not be tolerated except upon the direst necessity." It was then held that land already devoted
to a public use cannot be taken by the public for another use which is inconsistent with the first,
without special authority from the Legislature, or authority granted by necessary and reasonable
implication.

The second decision is that of Memphis State Line Railroad Company vs. Forest Hill Cemetery Co.
([1906], 116 Tenn., 400.) Here the purpose of the proceedings was to condemn a right of way for the
railway company through the Forest Hill Cemetery. The railroad proposed to run through the
southeast corner of the cemetery where no bodies were interred. The cemetery had been in use for
about eight years, and during this period thirteen hundred bodies had been buried therein. The
cemetery was under the control of a corporation which, by its character, held itself out as being
willing to sell lots to any one who applies therefor and pays the price demanded, except to members
of the Negro race. 1awph!l.net

It was found that there were two other routes along which the railroad might be located without
touching the cemetery, while the present line might be pursued without interfering with Forest Hill
Cemetery by making a curve around it. In the court below the railroad was granted the right of
condemnation through the cemetery and damages were assessed. On appeal, the certiorari applied
for was granted, and the supersedeas awarded. The court, in effect, found that the land of the
Cemetery Company was devoted to a public purpose, and that under the general language of the
Tennessee statute of eminent domain it could not be taken for another public purpose. The court
said that in process of time the sepulchres of the dead "are made the seats of cities, and are
traversed by streets, and daily trodden by the feet of man. This is inevitable in the course of ages.
But while these places are yet within the memory and under the active care of the living, while they
are still devoted to pious uses, they are sacred, and we cannot suppose that the legislature intended
that they should be violated, in the absence of special provisions upon the subject authorizing such
invasion, and indicating a method for the disinterment, removal, and reinterment of the bodies
buried, and directing how the expense thereof shall be borne." Two members of the court, delivering
a separate concurring opinion, concluded with this significant and eloquent sentence: "The wheels of
commerce must stop at the grave."

For the foregoing reasons, and for others which are stated in the principal decision, I am of the
opinion that the judgment of the lower court should be affirmed.

STREET, J., dissenting:

It may be admitted that, upon the evidence before us, the projected condemnation of the Chinese
Cemetery is unnecessary and perhaps ill-considered. Nevertheless I concur with Justice Moir in the
view that the authorities of the city of Manila are the proper judges of the propriety of the
condemnation and that this Court should have nothing to do with the question of the necessity of the
taking.

MOIR, J., dissenting:

I dissent from the majority opinion in this case, which has not yet been written, and because of the
importance of the question involved, present my dissent for the record.

This is an action by the city of Manila for the expropriation of land for an extension of Rizal Avenue
north. The petition for condemnation was opposed by the "Comunidad de Chinos de Manila" and
Ildefonso Tambunting and various other who obtained permission of the trial court to intervene in the
case.

All of the defendants allege in their opposition that the proposed extension of Rizal Avenue cuts
through a part of the Chinese Cemetery, North of Manila, and necessitates the destruction of many
monuments and the removal of many graves.

The Court of First Instance of Manila, Honorable S. del Rosario, judge after hearing the parties,
decided that there was no need for constructing the street as and where proposed by the city, and
dismissed the petition.

The plaintiff appealed and sets up the following errors:

1. The court erred in deciding that the determination of the necessity and convenience of the
expropriation of the lands of the defendants lies with the court and not with the Municipal
Board of the city of Manila.

2. The court erred in permitting the presentation of proofs over the objection and exception of
the plaintiff tending to demonstrate the lack of necessity of the projected street and the need
of the lands in question.
 3. The court erred in declaring that the plaintiff had no right to expropriate the lands in
question.

4. The court erred in dismissing the complaint.

The right of the plaintiff to expropriate property for public use cannot be denied. The "right of eminent
domain is inherent in all sovereignties and therefore would exist without any constitutional
recognition . . . . The right of eminent domain antedates constitutions . . . . The right can only be
denied or restricted by fundamental law and is right inherent in society." (15 Cyc., pp. 557-8.) .

This general right was recognized in the Philippine Code of Civil Procedure effective October 1st,
1901, which prescribed the manner of exercising the right. (Sections 241 et seq.)

It was further recognized in the Organic Act of July 1st, 1902, which provides in section 74 "that the
Government of the Philippine Islands may grant franchises . . . including the authority to exercise the
right of eminent domain for the construction and operation of works of public utility and service, and
may authorize said works to be constructed and maintained over and across the public property of
the United States including . . . reservations." This provisions is repeated in the Jones Law of
August, 1916.

The legislature of the Islands conferred the right on the city of Manila. (Section 2429, Administrative
Code of 1917; section 2402, Administrative Code of 1916.)

Clearly having the right of expropriation, the city of Manila selected the line of its street and asked
the court by proper order to place the plaintiff in possession of the land described in the complaint,
and to appoint Commissioners to inspect the property, appraise the value, and assess the damages.
Instead of doing so, the court entered upon the question of the right of the city to take the property
and the necessity for the taking.

The court says:

The controversy relates to whether or not the Chinese Cemetery, where a great majority of
this race is buried and other persons belonging to other nationalities have been formerly
inhumed, is private or public; whether or not said cemetery, in case it is public, would be
susceptible to expropriation for the purpose of public improvements proposed by the city of
Manila; whether or not the latter is justified of the necessity and expediency of similar
expropriation before its right to the same would be upheld by the courts of justice; and
whether or not the appreciation of said necessity pertains to the legislative or the judicial
department before which the expropriation proceedings have been brought.

Relative to the first point, it is not necessary for the court to pass upon its consideration, in
view of the conclusion it has arrived at the appreciation of the other points connected with
each other.

From the testimony of two reputable engineers produced by some of the defendants, it
appears that the land chosen by the plaintiff for the extension of Rizal Avenue to the
municipality of Caloocan is not the best or the less expensive, although upon it there may be
constructed a straight road, without curves or winding; but that in order to construct said road
upon said land, the city of Manila would have to remove and transfer to other places about
four hundred graves and monuments, make some grubbings, undergo some leveling and
build some bridges — the works thereon, together with the construction of the road and the
 value of the lands expropriated, would mean an expenditure which will not be less than
P180,000.

Beside that considerable amount, the road would have a declivity of 3 per cent which, in
order to cover a distance of one kilometer, would require an energy equivalent to that which
would be expanded in covering a distance of two and one-half kilometers upon a level road.

On the other hand, if the road would be constructed with the deviation proposed by Ildefonso
Tambunting, one of the defendants, who even offered to donate gratuitously to the city of
Manila part of the land upon which said road will have to be constructed, the plaintiff entity
would be able to save more than hundreds of thousand of pesos, which can be invested in
other improvements of greater pressure and necessity for the benefit of the taxpayers; and it
will not have to employ more time and incur greater expenditures in the removal and transfer
of the remains buried in the land of the Chinese Community and of Sr. Tambunting, although
with the insignificant disadvantage that the road would be little longer by a still more
insignificant extension of 426 meters and 55 centimeters less than one-half kilometer,
according to the plan included in the records; but it would offer a better panorama to those
who would use it, and who would not have to traverse in their necessary or pleasure-making
trips or walks any cemetery which, on account of its nature, always deserves the respect of
the travellers. It should be observed that the proposed straight road over the cemetery, which
the city of Manila is proposing to expropriate, does not lead to any commercial, industrial, or
agricultural center, and if with said road it is endeavored to benefit some community or
created interest, the same object may be obtained by the proposed deviation of the road by
the defendants. The road traced by the plaintiffs has the disadvantage that the lands on both
sides thereof would not serve for residential purposes, for the reason that no one has the
pleasure to construct buildings upon cemeteries, unless it be in very overcrowded cities, so
exhausted of land that every inch thereof represents a dwelling house.

And it is against the ruling, that it lies with the court to determine the necessity of the proposed street
and not with the municipal board, that the appellant directs its first assignment of error.

It is a right of the city government to determine whether or not it will construct streets and where, and
the court's sole duty was to see that the value of the property was paid the owners after proper legal
proceedings ascertaining the value.

The law gives the city the right to take private property for public use. It is assumed it is unnecessary
to argue that a public road is a public use.

But it is argued that plaintiff must show that it is necessary to take this land for a public improvement.
The law does not so read, and it is believed that the great weight of authority, including the United
States Supreme Court, is against the contention.

The question of necessity is distinct from the question of public use, and former question is
exclusively for the legislature, except that if the constitution or statute authorizes the taking of
property only in cases of necessity, then the necessity becomes a judicial question.
(McQuillen Municipal Corporations, Vol. IV, pp. 3090-3091.)

In the absence of some constitutional or statutory provision to the contrary, the necessity and
expediency of exercising the right of eminent domain are questions essentially political and
not judicial in their character. The determination of those questions belongs to the sovereign
power; the legislative determination is final and conclusive, and the courts have no power to
review it. It rests with the legislature not only to determine when the power of eminent
 domain may be exercised, but also the character, quality, method, and extent of such
exercise. And this power is unqualified, other than by the necessity of providing that
compensation shall be made. Nevertheless, under the express provisions of the constitution
of some states the question of necessity is made a judicial one, to be determined by the
courts and not by the legislature.

While the legislature may itself exercise the right of determining the necessity for the
exercise of the power of eminent domain, it may, unless prohibited by the constitution,
delegate this power to public officers or to private corporations established to carry on
enterprises in which the public are interested, and their determination that a necessity for the
exercise of the power exists is conclusive. There is no restraint upon the power except that
requiring compensation to be made. And when the power has been so delegated it is a
subject of legislative discretion to determine what prudential regulations shall be established
to secure a discreet and judicious exercise of the authority. It has been held that in the
absence of any statutory provision submitting the matter to a court or jury the decision of the
question of necessity lies with the body of individuals to whom the state has delegated the
authority to take, and the legislature may be express provision confer this power on a
corporation to whom the power of eminent domain is delegated unless prohibited by the
constitution. It is of course competent for the legislature to declare that the question shall be
a judicial one, in which case the court and not the corporation determines the question of
necessity. (15 Cyc., pp. 629-632.)

To the same effect is Lewis on Eminen Domain (3d Edition, section 597).

I quote from the notes to Vol. 5, Encyclopedia of United States Supreme Court Reports, p. 762, as
follows:

Neither can it be said that there is any fundamental right secured by the constitution of the
United States to have the questions of compensation and necessity both passed upon by
one and the same jury. In many states the question of necessity is never submitted to the
jury which passes upon the question of compensation. It is either settled affirmatively by the
legislature, or left to the judgment of the corporation invested with the right to take property
by condemnation. The question of necessity is not one of a judicial character, but rather one
for determination by the lawmaking branch of the government. (Boom Co. vs.Patterson, 98
U.S., 403, 406 [25 L. ed., 206]; United States vs. Jones, 109 U.S., 513 [27 L. ed., 1015];
Backus vs. Fort Street Union Depot Co., 169 U.S., 557, 568 [42 L. ed., 853].)

Speaking generally, it is for the state primarily and exclusively, to declare for what local public
purposes private property, within its limits may be taken upon compensation to the owner, as
well as to prescribe a mode in which it may be condemned and taken. (Madisonville Tract.
Co. vs. St. Bernard Min. Co., 196 U.S., 239, 252 [49 L. ed., 462].)

Courts have no power to control the legislative authority in the exercise of their right to
determine when it is necessary or expedient to condemn a specific piece of property for
public purposes. (Adirondack R. Co. vs.New York States, 176 U.S., 335 [44 L. ed., 492].)

10 R. C. L. (p. 183), states the law as follows:

158. Necessity for taking ordinarily not judicial question. — The legislature, in providing for
the exercise the power of eminent domain, may directly determine the necessity for
appropriating private property for a particular improvement or public use, and it may select
the exact location of the improvement. In such a case, it is well settled that the utility of the
 proposed improvement, the extent of the public necessity for its construction, the expediency
of constructing it, the suitableness of the location selected and the consequent necessity of
taking the land selected for its site, are all questions exclusively for the legislature to
determine, and the courts have no power to interfere, or to substitute their own views for
these of the representatives of the people. Similarly, when the legislature has delegated the
power of eminent domain to municipal or public service corporation or other tribunals or
bodies, and has given them discretion as to when the power is to be called into exercise and
to what extent, the court will not inquire into the necessity or propriety of the taking.

The United States Supreme Court recently said:

The uses to which this land are to be put are undeniably public uses. When that is the case
the propriety or expediency of the appropriation cannot be called in question by any other
authority. (Cinnati vs. S. & N. R. R. Co., 223 U.S., 390, quoting U.S. vs. Jones, 109, U.S.,
519.)

And in Sears vs. City of Akron (246 U.S., 242), decided March 4th, 1918, it said:

Plaintiff contends that the ordinance is void because the general statute which authorized the
appropriation violates both Article 1, paragraph 10, of the Federal Constitution, and the
Fourteenth Amendment, in that it authorizes the municipality to determine the necessity for
the taking of private property without the owners having an opportunity to be hear as to such
necessity; that in fact no necessity existed for any taking which would interfere with the
company's project; since the city might have taken water from the Little Cuyahoga or the
Tuscarawas rivers; and furthermore, that it has taken ten times as much water as it can
legitimately use. It is well settled that while the question whether the purpose of a taking is a
public one is judicial (Hairston vs.Danville & W. R. Co., 208 U.S. 598 [52 L. ed., 637; 28 Sup.
Ct. Rep., 331; 13 Ann. Cas., 1008]), the necessityand the proper extent of a taking is a
legislative question. (Shoemaker vs. United States, 147 U.S., 282, 298 [57 L. ed., 170, 184;
13 Supt. Ct. Rep., 361]; United States vs. Gettysburg Electric R. Co., 160 U.S. 668, 685 [40
L. ed., 576, 582; 16 Sup. Ct. Rep., 427]; United States vs. Chandler-Dunbar Water Power
Co., 229 U.S., 53, 65 [57 L. ed., 1063, 1076; 33 Sup. Ct. Rep., 667].)

I think the case should be decided in accordance with foregoing citations, but one other point has
been argued so extensively that it ought to be considered.

It is contended for the defense that this Chinese Cemetery is a public cemetery and that it cannot
therefore be taken for public use. In its answer the "Comunidad de Chinos de Manila" says it is "a
corporation organized and existing under and by virtue of the laws of the Philippine Islands," and that
it owns the land which plaintiff seeks to acquire. The facts that it is private corporation owning land
would seem of necessity to make the land it owns private land. The fact that it belongs to the
Chinese community deprives it of any public character.

But admitting that it is a public cemetery, although limited in its use to the Chinese Community of the
city of Manila, can it not be taken for public use? Must we let the reverence we feel for the dead and
the sanctity of their final resting-place obstruct the progress of the living? It will be instructive to
inquire what other jurisdictions have held on that point.

On the Application of Board of Street Openings of New York City to acquire St. Johns Cemetery (133
N.Y., 329) the court of appeal said:
 . . . The board instituted this proceeding under the act to acquire for park purposes the title to
land below One Hundred and Fifty-fifth street known as St. John's cemetery which belonged
to a religious corporation in the city of New York, commonly called Trinity Church. It was
established as a cemetery as early as 1801, and used for that purpose until 1839, during
which time about ten thousand human bodies had been buried therein. In 1839 an ordinance
was passed by the city of New York forbidding interments south of Eighty-sixth street, and
since that time no interments have been made in the cemetery, but Trinity Church has
preserved and kept it in order and prevented any disturbance thereof.

It is contended on behalf of Trinity Church that under the general authority given by statute of
1887, this land which had been devoted to cemetery purposes could not be taken for a park.
The authority conferred upon the board by the act is broad and general. It is authorized to
take for park purposes any land south of One Hundred and Fifty-fifth street. . . . .

The fact that lands have previously been devoted to cemetery purposes does not place them
beyond the reach of the power of eminent domain. That is an absolute transcendent power
belonging to the sovereign which can be exercised for the public welfare whenever the
sovereign authority shall determine that a necessity for its exercise exists. By its existence
the homes and the dwellings of the living, and the resting-places of the dead may be alike
condemned.

It seems always to have been recognized in the laws of this state, that under the general
laws streets and highways could be laid out through cemeteries, in the absence of special
limitation or prohibition. . . .

In Re Opening of Twenty-second Street (102 Penn. State Reports, 108) the Supreme Court of the
State said:

This was an action for the opening of a street through a cemetery in the City of Philadelphia.
It was contended for the United American Mechanics and United Daughters of America
Cemetery Association that by an act of the legislature of the State approved March 20th,
1849, they were forever exempt from the taking of any their property for streets, roads or
alleys and this Act was formally accepted by the Cemetery Company on April 9th, 1849, and
there was, therefore, a contract between the Cemetery Company and the State of
Pennsylvania, which would be violated by the taking of any part of their property for street
purposes. It was further contended that there were 11,000 persons buried in the cemetery.

The court held that property and contracts of all kinds must yield to the demand of the
sovereign and that under the power of eminent domain all properties could be taken, and
that if there was a contract between the State of Pennsylvania and the Cemetery
Association, the contract itself could be taken for public use, and ordered the opening of the
street through the cemetery.

In Vol. 5, Encyclopedia of United States Supreme Court Reports (p. 759), it is said:

Although it has been held, that where a state has delegated the power of eminent domain to
a person or corporation and where by its exercise lands have been subject to a public use,
they cannot be applied to another public use without specific authority expressed or implied
to that effect, yet, the general rule seems to be that the fact that property is already devoted
to a public use, does not exempt it from being appropriated under the right of eminent
domain but it may be so taken for a use which is clearly superior or paramount to the one to
which it is already devoted. (Citing many United States Supreme Court decisions.)
A few cases have been cited where the courts refused to allow the opening of streets through
cemeteries, but in my opinion they are not as well considered as the cases and authorities relied
upon herein.

The holding of this court in this case reverses well settled principles of law of long standing and
almost universal acceptance.

The other assignments of error need not be considered as they are involved in the foregoing.

The decision should be reversed and the record returned to the Court of First Instance with
instructions to proceed with the case in accordance with this decision.

United States v. Causby

Brief Fact Summary. Respondents claim that their property was taken, within the
meaning of the Fifth Amendment, by the regular army and navy aircraft flights over their
house and chicken farm.

Synopsis of Rule of Law. The airspace is a public highway, but if the landowner is to
have the full enjoyment of his land, he must have exclusive control over the immediate
reaches of the enveloping atmosphere.

Facts. Respondents own 2.8 acres near an airport outside of Greensboro, North
Carolina. Respondents’ property contained a house and a chicken farm. The end of one
of the runways of the airport was 2,220 feet from Respondents ’ property, and the glide
path passed over the property at 83 feet, which is 67 feet above the house, 63 feet
above the barn, and 18 feet above the highest tree. The use by the United States of this
airport is pursuant to a lease beginning June 1, 1942, and ending June 30, 1942, with
provisions for renewal until June 30, 1967, or six months after the end of the national
emergency, whichever is earlier. The United States ’ four motored bomber s make loud
noises when flying above the property, and have very bright lights. Respondents’
chicken farm production had to stop, because 150 chickens were killed by flying into
walls from fright. In the Court of Claims, it was found that the United States had taken
an easement over the property on June 1, 1942, and that the val
ue of the property depreciation as the result of the easement was $2,000.00. The United
States petitioned for certiorari, which was granted.

Issue. Has the Respondents’ property been taken within the meaning of the Fifth
Amendment?

Held. Yes. But the case is remanded for a determination of the value of the easement
and whether the easement was permanent or temporary.
The court noted the common law doctrine of ownership of land extending to the sky
above the land. However, the court notes that an act of Congress had given the United
States exclusive national sovereignty over the air space. The court noted that common
sense made the common law doctrine inapplicable.
However, the court found that the common law doctrine did not control the present case.
The United States had conceded in oral argument that if flights over the Respondents’
property rendered it uninhabitable then there would be a taking compensable under the
Fifth Amendment. The measure of the value of the property taken is the owner’s loss,
not the taker’s gain.
The airspace is a public highway. But it is obvious that if the landowner is to have the
full enjoyment of his land, he must have exclusive control of the immediate reaches of
the enveloping atmosphere. If this were not true then landowners could not build
buildings, plant trees or run fences.
The airspace, apart from the immediate reaches above the land, is part of the public
domain. The court does not set the precise limits of the line of demarcation. Flights over
private land are not a taking, unless, like here, they are so low and frequent as to be a
direct and immediate interference with the enjoyment of the land. The Court of Claims
must, upon remand, determine the value of the easement and whether it is a temporary
or permanent easement.

Dissent. The dissent would reverse the decision of the Court of Claims and hold that
there has been no taking within the meaning of the Fifth Amendment. This is because of
the modern nature of the airplane, and the desire to avoid confusion.

Discussion. The national emergency, World War II, meant that the airport, which was
not previously used by large planes, would be the home to large bombers. The use of
the airspace above Respondents’ home and farm was not a problem previously,
because the flights were sporadic and not nearly as loud as the bombers.

U.S. Supreme Court

United States v. Causby, 328 U.S. 256 (1946)

United States v. Causby

No. 630

Argued May 1, 1946

Decided May 27, 1946

328 U.S. 256

CERTIORARI TO THE COURT OF CLAIMS

Syllabus

Respondents owned a dwelling and a chicken farm near a municipal airport. The safe
path of glide to one of the runways of the airport passed directly over respondents'
property at 83 feet, which was 67 feet above the house, 63 feet above the barn and 18
feet above the highest tree. It was used 4% of the time in taking off and 7% of the time
in landing. The Government leased the use of the airport for a term of one month
commencing June 1, 1942, with a provision for renewals until June 30, 1967, or six
months after the end of the national emergency, whichever was earlier. Various military
aircraft of the United States used the airport. They frequently came so close to
respondents' property that they barely missed the tops of trees, the noise was startling,
and the glare from their landing lights lighted the place up brightly at night. This
destroyed the use of the property as a chicken farm and caused loss of sleep,
nervousness, and fright on the part of respondents. They sued in the Court of Claims to
recover for an alleged taking of their property and for damages to their poultry business.
The Court of Claims found that the Government had taken an easement over
respondents' property, and that the value of the property destroyed and the easement
taken was $2,000; but it made no finding as to the precise nature or duration of the
easement.

Held:

1. A servitude has been imposed upon the land for which respondents are entitled to
compensation under the Fifth Amendment. Pp. 328 U. S. 260-267.

(a) The common law doctrine that ownership of land extends to the periphery of the
universe has no place in the modern world. Pp. 328 U. S. 260-261.

(b) The air above the minimum safe altitude of flight prescribed by the Civil Aeronautics
Authority is a public highway and part of the public domain, as declared by Congress in
the Air Commerce Act of 1926, as amended by the Civil Aeronautics Act of 1938.
Pp. 328 U. S. 260-261, 328 U. S. 266.

(c) Flights below that altitude are not within the navigable air space which Congress
placed within the public domain, even though they are within the path of glide approved
by the Civil Aeronautics Authority. Pp. 328 U. S. 263-264.

Page 328 U. S. 257

(d) Flights of aircraft over private land which are so low and frequent as to be a direct
and immediate interference with the enjoyment and use of the land are as much an
appropriation of the use of the land as a more conventional entry upon it. Pp. 328 U. S.
261-262, 328 U. S. 264-267.
2. Since there was a taking of private property for public use, the claim was "founded
upon the Constitution," within the meaning of § 141(1) of the Judicial Code, and the
Court of Claims had jurisdiction to hear and determine it. P. 328 U. S. 267.

3. Since the court's findings of fact contain no precise description of the nature or
duration of the easement taken, the judgment is reversed, and the cause is remanded
to the Court of Claims so that it may make the necessary findings. Pp.328 U. S. 267-
268.

(a) An accurate description of the easement taken is essential, since that interest vests
in the United States. P. 328 U. S. 267.

(b) Findings of fact on every "material issue" are a statutory requirement, and a
deficiency in the findings cannot be rectified by statements in the opinion. Pp. 328 U. S.
267-268.

(c) A conjecture in lieu of a conclusion from evidence would not be a proper foundation
for liability of the United States. P.328 U. S. 268.

104 Ct.Cls. 342, 60 F.Supp. 751, reversed and remanded.

The Court of Claims granted respondents a judgment for the value of property
destroyed and damage to their property resulting from the taking of an easement over
their property by low-flying military aircraft of the United States, but failed to include in
its findings of fact a specific description of the nature or duration of the easement. 104
Ct.Cls. 342, 60 F.Supp. 751. This Court granted certiorari. 327 U.S. 775. Reversed and
remanded, p. 328 U. S. 268.

Page 328 U. S. 258

MR. JUSTICE DOUGLAS delivered the opinion of the Court.

This is a case of first impression. The problem presented is whether respondents'

property was taken within the meaning of the Fifth Amendment by frequent and regular
flights of army and navy aircraft over respondents' land at low altitudes. The Court of
Claims held that there was a taking, and entered judgment for respondent, one judge
dissenting. 60 F.Supp. 751. The case is here on a petition for a writ of certiorari which
we granted because of the importance of the question presented.

Respondents own 2.8 acres near an airport outside of Greensboro, North Carolina. It
has on it a dwelling house, and also various outbuildings which were mainly used for
raising chickens. The end of the airport's northwest-southeast runway is 2,220 feet from
respondents' barn and 2,275 feet from their house. The path of glide to this runway
passes directly over the property -- which is 100 feet wide and 1,200 feet long. The 30
to 1 safe glide angle [Footnote 1] approved by the Civil Aeronautics Authority [Footnote
2] passes over this property at 83 feet, which is 67 feet above the house, 63 feet above
the barn and 18 feet above the highest tree. [Footnote 3] The use by the United States
of this airport is pursuant to a lease executed in May, 1942, for a term commencing
June 1, 1942 and ending June 30, 1942, with a provision for renewals until June 30,
1967, or six

Page 328 U. S. 259

months after the end of the national emergency, whichever is the earlier.

Various aircraft of the United States use this airport -- bombers, transports, and fighters.
The direction of the prevailing wind determines when a particular runway is used. The
northwest-southeast runway in question is used about four percent of the time in taking
off and about seven percent of the time in landing. Since the United States began
operations in May, 1942, its four-motored heavy bombers, other planes of the heavier
type, and its fighter planes have frequently passed over respondents' land buildings in
considerable numbers and rather close together. They come close enough at times to
appear barely to miss the tops of the trees, and at times so close to the tops of the trees
as to blow the old leaves off. The noise is startling. And, at night, the glare from the
planes brightly lights up the place. As a result of the noise, respondents had to give up
their chicken business. As many as six to ten of their chickens were killed in one day by
flying into the walls from fright. The total chickens lost in that manner was about 150.
Production also fell off. The result was the destruction of the use of the property as a
commercial chicken farm. Respondents are frequently deprived of their sleep, and the
family has become nervous and frightened. Although there have been no airplane
accidents on respondents' property, there have been several accidents near the airport
and close to respondents' place. These are the essential facts found by the Court of
Claims. On the basis of these facts, it found that respondents' property had depreciated
in value. It held that the United States had taken an easement over the property on
June 1, 1942, and that the value of the property destroyed and the easement taken was
$2,000.

Page 328 U. S. 260

I. The United States relies on the Air Commerce Act of 1926, 44 Stat. 568, 49 U.S.C. §
171 et seq., as amended by the Civil Aeronautics Act of 1938, 52 Stat. 973, 49 U.S.C. §
401 et seq. Under those statutes, the United States has "complete and exclusive
national sovereignty in the air space" over this country. 49 U.S.C. § 176(a). They grant
any citizen of the United States "a public right of freedom of transit in air commerce
[Footnote 4] through the navigable air space of the United States." 49 U.S.C. § 403. And
"navigable air space" is defined as "airspace above the minimum safe altitudes of flight
prescribed by the Civil Aeronautics Authority." 49 U.S.C. § 180. And it is provided that
"such navigable airspace shall be subject to a public right of freedom of interstate and
foreign air navigation." Id. It is therefore argued that, since these flights were within the
minimum safe altitudes of flight which had been prescribed, they were an exercise of
the declared right of travel through the airspace. The United States concludes that,
when flights are made within the navigable airspace without any physical invasion of the
property of the landowners, there has been no taking of property. It says that, at most,
there was merely incidental damage occurring as a consequence of authorized air
navigation. It also argues that the landowner does not own superadjacent airspace
which he has not subjected to possession by the erection of structures or other
occupancy. Moreover, it is argued that, even if the United States took airspace owned
by respondents, no compensable damage was shown. Any damages are said to be
merely consequential for which no compensation may be obtained under the Fifth
Amendment.

It is ancient doctrine that at common law ownership of the land extended to the
periphery of the universe -- cujus

Page 328 U. S. 261

est solum ejus est usque and coelum. [Footnote 5] But that doctrine has no place in the
modern world. The air is a public highway, as Congress has declared. Were that not
true, every transcontinental flight would subject the operator to countless trespass suits.
Common sense revolts at the idea. To recognize such private claims to the airspace
would clog these highways, seriously interfere with their control and development in the
public interest, and transfer into private ownership that to which only the public has a
just claim.

But that general principle does not control the present case. For the United States
conceded on oral argument that, if the flights over respondents' property rendered it
uninhabitable, there would be a taking compensable under the Fifth Amendment. It is
the owner's loss, not the taker's gain, which is the measure of the value of the property
taken. United States v. Miller, 317 U. S. 369. Market value fairly determined is the
normal measure of the recovery. Id. And that value may reflect the use to which the land
could readily be converted, as well as the existing use. United States v. Powelson, 319
U. S. 266, 319 U. S. 275, and cases cited. If, by reason of the frequency and altitude of
the flights, respondents could not use this land for any purpose, their loss would be
complete. [Footnote 6] It would be as complete as if the United States had entered upon
the surface of the land and taken exclusive possession of it.

We agree that, in those circumstances, there would be a taking. Though it would be only
an easement of flight

Page 328 U. S. 262

which was taken, that easement, if permanent and not merely temporary, normally
would be the equivalent of a fee interest. It would be a definite exercise of complete
dominion and control over the surface of the land. The fact that the planes never
touched the surface would be as irrelevant as the absence in this day of the feudal
livery of seisin on the transfer of real estate. The owner's right to possess and exploit
the land -- that is to say, his beneficial ownership of it -- would be destroyed. It would not
be a case of incidental damages arising from a legalized nuisance, such as was
involved in Richards v. Washington Terminal Co., 233 U. S. 546. In that case, property
owners whose lands adjoined a railroad line were denied recovery for damages
resulting from the noise, vibrations, smoke, and the like, incidental to the operations of
the trains. In the supposed case, the line of flight is over the land. And the land is
appropriated as directly and completely as if it were used for the runways themselves.

There is no material difference between the supposed case and the present one, except
that, here, enjoyment and use of the land are not completely destroyed. But that does
not seem to us to be controlling. The path of glide for airplanes might reduce a valuable
factory site to grazing land, an orchard to a vegetable patch, a residential section to a
wheat field. Some value would remain. But the use of the airspace immediately above
the land would limit the utility of the land and cause a diminution in its value. [Footnote
7] That was the philosophy of Portsmouth Harbor Land & Hotel Co. v.

Page 328 U. S. 263

United States, 260 U. S. 327. In that case, the petition alleged that the United States
erected a fort on nearby land, established a battery and a fire control station there, and
fired guns over petitioner's land. The Court, speaking through Mr. Justice Holmes,
reversed the Court of Claims which dismissed the petition on a demurrer, holding that
"the specific facts set forth would warrant a finding that a servitude has been imposed."
[Footnote 8] 260 U.S. at 260 U. S. 330. And see Delta Air Corp. v. Kersey, 193 Ga. 862,
20 S.E.2d 245. Cf. United States v. 357.25 Acres of Land, 55 F.Supp. 461.

The fact that the path of glide taken by the planes was that approved by the Civil
Aeronautics Authority does not change the result. The navigable airspace which
Congress has placed in the public domain is "airspace above the minimum safe
altitudes of flight prescribed by the Civil Aeronautics Authority." 49 U.S.C. § 180. If that
agency prescribed 83 feet as the minimum safe altitude, then we would have presented
the question of the validity of the regulation. But nothing of the sort has been done. The
path of glide governs the method of operating -- of landing or taking off. The altitude
required for that operation is not the minimum safe altitude of flight which is the
downward reach of the navigable airspace. The minimum prescribed by the authority is
500 feet during the day and 1000 feet at night for air carriers (Civil Air Regulations, Pt.
61, §§ 61.7400, 61.7401, Code Fed.Reg.Cum.Supp., Tit. 14, ch. 1) and from 300 to
1000 feet for

Page 328 U. S. 264

other aircraft depending on the type of plane and the character of the terrain. Id., Pt. 60,
§§ 60.350-60.3505, Fed.Reg.Cum.Supp., supra. Hence, the flights in question were not
within the navigable airspace which Congress placed within the public domain. If any
airspace needed for landing or taking off were included, flights which were so close to
the land as to render it uninhabitable would be immune. But the United States
concedes, as we have said, that, in that event, there would be a taking. Thus, it is
apparent that the path of glide is not the minimum safe altitude of flight within the
meaning of the statute. The Civil Aeronautics Authority has, of course, the power to
prescribe air traffic rules. But Congress has defined navigable airspace only in terms of
one of them -- the minimum safe altitudes of flight.

We have said that the airspace is a public highway. Yet it is obvious that, if the
landowner is to have full enjoyment of the land, he must have exclusive control of the
immediate reaches of the enveloping atmosphere. Otherwise buildings could not be
erected, trees could not be planted, and even fences could not be run. The principle is
recognized when the law gives a remedy in case overhanging structures are erected on
adjoining land. [Footnote 9] The landowner owns at least as much of the space above
the ground as the can occupy or use in connection with the land. See Hinman v. Pacific
Air Transport, 84 F.2d 755. The fact that he does not occupy it in a physical sense -- by
the erection of buildings and the like -- is not material. As we have said, the flight of
airplanes, which skim the surface but do not touch it, is as much an appropriation of the
use of the land as a more conventional entry upon it. We would not doubt that, if the
United States erected

Page 328 U. S. 265

an elevated railway over respondents' land at the precise altitude where its planes now
fly, there would be a partial taking, even though none of the supports of the structure
rested on the land. [Footnote 10] The reason is that there would be an intrusion so
immediate and direct as to subtract from the owner's full enjoyment of the property and
to limit his exploitation of it. While the owner does not in any physical manner occupy
that stratum of airspace or make use of it in the conventional sense, he does use it in
somewhat the same sense that space left between buildings for the purpose of light and
air is used. The superadjacent airspace at this low altitude is so close to the land that
continuous invasions of it affect the use of the surface of the land itself. We think that
the landowner, as an incident to his ownership, has a claim to it, and that invasions of it
are in the same category as invasions of the surface. [Footnote 11]

In this case, as in Portsmouth Harbor Land & Hotel Co. v. United States, supra, the
damages were not merely consequential. They were the product of a direct invasion of
respondents' domain.

Page 328 U. S. 266

As stated in United States v. Cress, 243 U. S. 316, 243 U. S. 328,

". . . it is the character of the invasion, not the amount of damage resulting from it, so
long as the damage is substantial, that determines the question whether it is a taking."

We said in United States v. Powelson, supra, p. 319 U. S. 279, that, while the meaning
of "property" as used in the Fifth Amendment was a federal question, "it will normally
obtain its content by reference to local law." If we look to North Carolina law, we reach
the same result. Sovereignty in the airspace rests in the State "except where granted to
and assumed by the United States." Gen.Stats.1943, § 63-11. The flight of aircraft is
lawful

"unless at such a low altitude as to interfere with the then existing use to which the land
or water, or the space over the land or water, is put by the owner, or unless so
conducted as to be imminently dangerous to persons or property lawfully on the land or
water beneath."

Id., § 63-13. Subject to that right of flight, "ownership of the space above the lands and
waters of this State is declared to be vested in the several owners of the surface
beneath." Id., § 63-12. Our holding that there was an invasion of respondents' property
is thus not inconsistent with the local law governing a landowner's claim to the
immediate reaches of the superadjacent airspace.

The airplane is part of the modern environment of life, and the inconveniences which it
causes are normally not compensable under the Fifth Amendment. The airspace, apart
from the immediate reaches above the land, is part of the public domain. We need not
determine at this time what those precise limits are. Flights over private land are not a
taking, unless they are so low and so frequent as to be a direct and immediate
interference with the enjoyment and use of the land. We need not speculate on that
phase of the present case. For the findings of the Court

Page 328 U. S. 267

of Claims plainly establish that there was a diminution in value of the property, and that
the frequent, low-level flights were the direct and immediate cause. We agree with the
Court of Claims that a servitude has been imposed upon the land.

II. By § 145(1) of the Judicial Code, 28 U.S.C. § 250(1), the Court of Claims has
jurisdiction to hear and determine

"All claims (except for pensions) founded upon the Constitution of the United States
or . . . upon any contract, express or implied, with the Government of the United States."

We need not decide whether repeated trespasses might give rise to an implied
contract. Cf. Portsmouth Harbor Land & Hotel Co. v. United States, supra. If there is a
taking, the claim is "founded upon the Constitution," and within the jurisdiction of the
Court of Claims to hear and determine. See Hollister v. Benedict & Burnham Mfg.
Co., 113 U. S. 59, 113 U. S. 67; Hurley v. Kincaid, 285 U. S. 95, 285 U. S. 104; Yearsley
v. W. A. Ross Construction Co., 309 U. S. 18, 309 U. S. 21. Thus, the jurisdiction of the
Court of Claims in this case is clear.

III. The Court of Claims held, as we have noted, that an easement was taken. But the
findings of fact contain no precise description as to its nature. It is not described in
terms of frequency of flight, permissible altitude, or type of airplane. Nor is there a
finding as to whether the easement taken was temporary or permanent. Yet an accurate
description of the property taken is essential, since that interest vests in the United
States. United States v. Cress, supra, 243 U. S. 328-329, and cases cited. It is true that
the Court of Claims stated in its opinion that the easement taken was permanent. But
the deficiency in findings cannot be rectified by statements in the opinion. United States
v. Esnault-Pelterie, 299 U. S. 201, 299 U. S. 205-206; United States v. Seminole
Nation, 299 U. S. 417, 299 U. S. 422. Findings of fact on every "material issue" are a
statutory

Page 328 U. S. 268

requirement. 53 Stat. 752, 28 U.S.C. § 288. The importance of findings of fact based on
evidence is emphasized here by the Court of Claims' treatment of the nature of the
easement. It stated in its opinion that the easement was permanent because the United
States "no doubt intended to make some sort of arrangement whereby it could use the
airport for its military planes whenever it had occasion to do so." That sounds more like
conjecture, rather than a conclusion from evidence, and if so, it would not be a proper
foundation for liability of the United States. We do not stop to examine the evidence to
determine whether it would support such a finding, if made. For that is not our
function. United States v. Esnault-Pelterie, supra, p. 299 U. S. 206.

Since on this record it is not clear whether the easement taken is a permanent or a
temporary one, it would be premature for us to consider whether the amount of the
award made by the Court of Claims was proper.

The judgment is reversed, and the cause is remanded to the Court of Claims so that it
may make the necessary findings in conformity with this opinion.

Reversed.

PEOPLE VS. FAJARDO [104 Phil 443; G.R. No. L-12172;

29 Aug 1958]
Saturday, January 31, 2009 Posted by Coffeeholic Writes
Labels: Case Digests, Political Law

Facts: The municipal council of baao, camarines sur stating among others
that construction of a building, which will destroy the view of the plaza, shall not
be allowed and therefore be destroyed at the expense of the owner, enacted an
ordinance. Herein appellant filed a written request with the incumbent municipal
mayor for a permit to construct a building adjacent to their gasoline station on a
parcel of land registered in Fajardo's name, located along the national highway
and separated from the public plaza by a creek. The request was denied, for the
reason among others that the proposed building would destroy the view or
beauty of the public plaza. Defendants reiterated their request for a building
permit, but again the mayor turned down the request. Whereupon, appellants
proceeded with the construction of the building without a permit, because they
needed a place of residence very badly, their former house having been
destroyed by a typhoon and hitherto they had been living on leased property.
Thereafter, defendants were charged in violation of the ordinance and
subsequently convicted. Hence this appeal.

Issue: Whether or Not the ordinance is a valid exercise of police power.

Held: No. It is not a valid exercise of police power. The ordinance is

unreasonable and oppressive, in that it operates to permanently deprive
appellants of the right to use their own property; hence, it oversteps
thebounds of police power, and amounts to a taking of appellant ’s property
without just compensation. We do not overlook that the modern tendency is to
regard the beautification of neighborhoods as conducive to the comfort and
happiness of residents.

As the case now stands, every structure that may be erected on appellants'
land, regardless of its own beauty, stands condemned under the ordinance in
question, because it would interfere with the view of the public plaza from the
highway. The appellants would, in effect, be constrained to let their land remain
idle and unused for the obvious purpose for which it is best suited, being urban
in character. To legally achieve that result, the municipality must give
appellants justcompensation and an opportunity to be heard.

G.R. No. L-12172 August 29, 1958

THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee,
vs.
JUAN F. FAJARDO, ET AL., defendants-appellants.

Assistant Solicitor General Esmeraldo Umali and Higinio V. Catalan for appellee.
Prila, Pardalis and Pejo for appellants.

REYES, J. B. L., J.:

Appeal from the decision of the Court of First Instance of Camarines Sur convicting defendants-
appellants Juan F. Fajardo and Pedro Babilonia of a violation of Ordinance No. 7, Series of 1950, of
the Municipality of Baao, Camarines Sur, for having constructed without a permit from the municipal
mayor a building that destroys the view of the public plaza.

It appears that on August 15, 1950, during the incumbency of defendant-appellant Juan F. Fajardo
as mayor of the municipality of Baao, Camarines Sur, the municipal council passed the ordinance in
question providing as follows:

SECTION 1. Any person or persons who will construct or repair a building should, before
constructing or repairing, obtain a written permit from the Municipal Mayor.

SEC. 2. A fee of not less than P2.00 should be charged for each building permit and P1.00
for each repair permit issued.

SEC. 3. PENALTY — Any violation of the provisions of the above, this ordinance, shall make
the violation liable to pay a fine of not less than P25 nor more than P50 or imprisonment of
not less than 12 days nor more than 24 days or both, at the discretion of the court. If said
building destroys the view of the Public Plaza or occupies any public property, it shall be
removed at the expense of the owner of the building or house.

SEC. 4. EFFECTIVITY — This ordinance shall take effect on its approval. (Orig. Recs., P. 3)

Four years later, after the term of appellant Fajardo as mayor had expired, he and his son in-law,
appellant Babilonia, filed a written request with the incumbent municipal mayor for a permit to
construct a building adjacent to their gasoline station on a parcel of land registered in Fajardo's
name, located along the national highway and separated from the public plaza by a creek (Exh. D).
On January 16, 1954, the request was denied, for the reason among others that the proposed
building would destroy the view or beauty of the public plaza (Exh. E). On January 18, 1954,
defendants reiterated their request for a building permit (Exh. 3), but again the request was turned
down by the mayor. Whereupon, appellants proceeded with the construction of the building without a
permit, because they needed a place of residence very badly, their former house having been
destroyed by a typhoon and hitherto they had been living on leased property.

On February 26, 1954, appellants were charged before and convicted by the justice of the peace
court of Baao, Camarines Sur, for violation of the ordinance in question. Defendants appealed to the
Court of First Instance, which affirmed the conviction, and sentenced appellants to pay a fine of P35
each and the costs, as well as to demolish the building in question because it destroys the view of
the public plaza of Baao, in that "it hinders the view of travelers from the National Highway to the
said public plaza." From this decision, the accused appealed to the Court of Appeals, but the latter
forwarded the records to us because the appeal attacks the constitutionality of the ordinance in
question.
We find that the appealed conviction can not stand.

A first objection to the validity of the ordinance in question is that under it the mayor has absolute
discretion to issue or deny a permit. The ordinance fails to state any policy, or to set up any standard
to guide or limit the mayor's action. No purpose to be attained by requiring the permit is expressed;
no conditions for its grant or refusal are enumerated. It is not merely a case of deficient standards;
standards are entirely lacking. The ordinance thus confers upon the mayor arbitrary and unrestricted
power to grant or deny the issuance of building permits, and it is a settled rule that such an
undefined and unlimited delegation of power to allow or prevent an activity, per se lawful, is invalid
(People vs. Vera, 65 Phil., 56; Primicias vs. Fugoso, 80 Phil., 71; Schloss Poster Adv. Co. vs. Rock
Hill, 2 SE (2d) 392)

The ordinance in question in no way controls or guides the discretion vested thereby in the
respondents. It prescribes no uniform rule upon which the special permission of the city is to
be granted. Thus the city is clothed with the uncontrolled power to capriciously grant the
privilege to some and deny it others; to refuse the application of one landowner or lessee
and to grant that of another, when for all material purposes, the two applying for precisely the
same privileges under the same circumstances. The danger of such an ordinance is that it
makes possible arbitrary discriminations and abuses in its execution, depending upon no
conditions or qualifications whatever, other than the unregulated arbitrary will of the city
authorities as the touchstone by which its validity is to be tested. Fundamental rights under
our government do not depend for their existence upon such a slender and uncertain thread.
Ordinances which thus invest a city council with a discretion which is purely arbitrary, and
which may be exercised in the interest of a favored few, are unreasonable and invalid. The
ordinance should have established a rule by which its impartial enforcement could be
secured. All of the authorities cited above sustain this conclusion.

As was said in City of Richmond vs. Dudley, 129 Ind. 112,28 N. E. 312, 314 13 L. R. A. 587,
28 Am. St. Rep. 180: "It seems from the foregoing authorities to be well established that
municipal ordinances placing restrictions upon lawful conduct or the lawful use of property
must, in order to be valid, specify the rules and conditions to be observed in such conduct or
business; and must admit of the exercise of the privilege of all citizens alike who will comply
with such rules and conditions; and must not admit of the exercise, or of an opportunity for
the exercise, of any arbitrary discrimination by the municipal authorities between citizens
who will so comply. (Schloss Poster Adv. Co., Inc. vs. City of Rock Hill, et al., 2 SE (2d), pp.
394-395).

It is contended, on the other hand, that the mayor can refuse a permit solely in case that the
proposed building "destroys the view of the public plaza or occupies any public property" (as stated
in its section 3); and in fact, the refusal of the Mayor of Baao to issue a building permit to the
appellant was predicated on the ground that the proposed building would "destroy the view of the
public plaza" by preventing its being seen from the public highway. Even thus interpreted, the
ordinance is unreasonable and oppressive, in that it operates to permanently deprive appellants of
the right to use their own property; hence, it oversteps the bounds of police power, and amounts to a
taking of appellants property without just compensation. We do not overlook that the modern
tendency is to regard the beautification of neighborhoods as conducive to the comfort and happiness
of residents. But while property may be regulated in the interest of the general welfare, and in its
pursuit, the State may prohibit structures offensive to the sight (Churchill and Tait vs. Rafferty, 32
Phil. 580), the State may not, under the guise of police power, permanently divest owners of the
beneficial use of their property and practically confiscate them solely to preserve or assure the
aesthetic appearance of the community. As the case now stands, every structure that may be
erected on appellants' land, regardless of its own beauty, stands condemned under the ordinance in
question, because it would interfere with the view of the public plaza from the highway. The
appellants would, in effect, be constrained to let their land remain idle and unused for the obvious
purpose for which it is best suited, being urban in character. To legally achieve that result, the
municipality must give appellants just compensation and an opportunity to be heard.

An ordinance which permanently so restricts the use of property that it can not be used for
any reasonable purpose goes, it is plain, beyond regulation and must be recognized as a
taking of the property. The only substantial difference, in such case, between restriction and
actual taking, is that the restriction leaves the owner subject to the burden of payment of
taxation, while outright confiscation would relieve him of that burden. (Arverne Bay Constr.
Co. vs. Thatcher (N.Y.) 117 ALR. 1110, 1116).

A regulation which substantially deprives an owner of all beneficial use of his property is
confiscation and is a deprivation within the meaning of the 14th Amendment. (Sundlum vs.
Zoning Bd., 145 Atl. 451; also Eaton vs. Sweeny, 177 NE 412; Taylor vs. Jacksonville, 133
So. 114).

Zoning which admittedly limits property to a use which can not reasonably be made of it
cannot be said to set aside such property to a use but constitutes the taking of such property
without just compensation. Use of property is an element of ownership therein. Regardless of
the opinion of zealots that property may properly, by zoning, be utterly destroyed without
compensation, such principle finds no support in the genius of our government nor in the
principles of justice as we known them. Such a doctrine shocks the sense of justice. If it be
of public benefit that property remain open and unused, then certainly the public, and not the
private individuals, should bear the cost of reasonable compensation for such property under
the rules of law governing the condemnation of private property for public use. (Tews vs.
Woolhiser (1933) 352 I11. 212, 185 N.E. 827) (Emphasis supplied.)

The validity of the ordinance in question was justified by the court below under section 2243, par. (c),
of the Revised Administrative Code, as amended. This section provides:

SEC. 2243. Certain legislative powers of discretionary character. — The municipal council
shall have authority to exercise the following discretionary powers:

xxx xxx xxx

(c) To establish fire limits in populous centers, prescribe the kinds of buildings that may be
constructed or repaired within them, and issue permits for the creation or repair thereof,
charging a fee which shall be determined by the municipal council and which shall not be
less than two pesos for each building permit and one peso for each repair permit issued. The
fees collected under the provisions of this subsection shall accrue to the municipal school
fund.

Under the provisions of the section above quoted, however, the power of the municipal council to
require the issuance of building permits rests upon its first establishing fire limits in populous parts of
the town and prescribing the kinds of buildings that may be constructed or repaired within them. As
there is absolutely no showing in this case that the municipal council had either established fire limits
within the municipality or set standards for the kind or kinds of buildings to be constructed or
repaired within them before it passed the ordinance in question, it is clear that said ordinance was
not conceived and promulgated under the express authority of sec. 2243 (c) aforequoted.
We rule that the regulation in question, Municipal Ordinance No. 7, Series of 1950, of the
Municipality of Baao, Camarines Sur, was beyond the authority of said municipality to enact, and is
therefore null and void. Hence, the conviction of herein appellants is reversed, and said accused are
acquitted, with costs de oficio. So ordered.

Paras, C. J., Bengzon, Padilla, Montemayor, Reyes, A., Bautista Angelo, Concepcion, Endencia and
Felix, JJ.,concur.

U.S. Supreme Court

Richards v. Washington Terminal Co., 233 U.S. 546 (1914)

Richards v. Washington Terminal Company

No. 52

Argued November 7, 1913

Decided May 4, 1914

233 U.S. 546

ERROR TO THE COURT OF APPEALS

OF THE DISTRICT OF COLUMBIA

Syllabus

Although in England, Parliament, being omnipotent, may authorize the taking of private
property for public use without compensation, the English courts decline to place an
unjust construction on its acts, and, unless so clear as not to admit any other meaning,
do not interpret them as interfering with rights of private property.

Legislation of Congress is different from that of Parliament, as it must be construed in

the light of that provision of the Fifth Amendment which forbids the taking of private
property for public use without compensation.

While Congress may legalize, within the sphere of its jurisdiction, what otherwise would
be a public nuisance, it may not confer immunity from action for a private nuisance of
such a character as to amount in effect to a taking of private property for public use.

While the owners of a railroad constructed and operated for the public use, although
with private property for private gain, are not, in the absence of negligence, subject to
action in behalf of owners of neighboring private property for the ordinary damages
attributable to the operation of the railroad, a property owner may be entitled to
compensation for such special damages as devolve exclusively upon his property and
not equally upon all the neighboring property.

In this case, held that an owner of property near the portal of a tunnel in the District of
Columbia constructed under authority of Congress, while not entitled to compensation
for damages caused by the usual gases and smoke emitted from the tunnel by reason
of the proper operation of the railroad, is entitled to compensation for such direct,
peculiar and substantial damages as specially affect his property and diminish its value.

37 App.D.C. 289 reversed.

The facts, which involve the right, under the Fifth Amendment, of an owner to be
compensated for special and peculiar damages to his property by reason of the
operation of a railroad near the premises, are stated in the opinion.

Page 233 U. S. 548

MR. JUSTICE PITNEY delivered the opinion of the Court.

Plaintiff in error, who was plaintiff below, commenced this action in the Supreme Court
of the District of Columbia to recover for the damage to his property resulting from the
maintenance of an alleged nuisance by defendant by means of the operation of a
railroad and tunnel upon its own lands near to, but not adjoining, those of plaintiff.
Defendant having pleaded not guilty, the issue came on for trial by jury, and, at the
conclusion of plaintiff's evidence, a verdict was directed in favor of defendant. The court
of appeals affirmed the judgment (37 App.D.C. 289), and a writ of error brings the
controversy under the review of this Court.

An agreed abridgment of the evidence upon which the ruling of the trial justice was
based is embodied in the bill of exceptions. From this it appears that plaintiff is and has
been since the year 1901 the owner of Lot 34 in Square 693 in the City of Washington,
having a frontage of 20 ft. upon the westerly side of New Jersey Avenue, Southeast,
and an average depth of 81 ft., with improvements thereon consisting of a three-story
and basement brick dwelling house containing ten rooms, known as No. 415 New
Jersey Avenue. The rear windows upon all the floors of the house open in the direction
of the railroad tracks that lead from defendant's tunnel. The south portal of this tunnel
opens within Square 693, and near its

Page 233 U. S. 549

northeasterly corner, and the tunnel extends thence in a northeasterly direction, passing
under the Capitol and Library grounds and First Street N.E. to the Union Station at
Massachusetts Avenue. There are two sets of railroad tracks in the tunnel and leading
from it, and as these emerge from the south portal, they extend in a general
southwesterly direction up an incline or grade across the central portion of Square 693
on to an elevated structure which carries the tracks over and beyond South Capitol
Street. The tunnel and these tracks are used for the passage of trains running both
northwardly and southwardly, about thirty each day, all of them being passenger trains
with the exception of an occasional shifting engine. The trains frequently pass in and out
of the tunnel without stopping, but trains also very often stop at or near a switch tower
that is situate near the center of Square 693. From the nearest portion of plaintiff's
house to the center of the south portal, the distance in a straight line is about 114 ft.,
there being three intervening dwelling houses, two of which have been purchased and
are now owned by defendant. From the rear end of plaintiff's lot to the middle of the
tracks southwestwardly from the portal the distance in a straight line is about 90 ft.
Plaintiff's property has been damaged by the volumes of dense black or gray smoke,
and also by dust and dirt, cinders and gases, emitted from the trains while passing over
the tracks and in or out of the tunnel, or standing upon the tracks near the signal tower.
There is a fanning system installed in the tunnel which causes the gases and smoke
emitted from engines while in the tunnel to be forced out of the south portal, and these
gases and smoke contaminate the air, and also add to the inconvenience suffered by
plaintiff in the occupation of his property. His house was pleasant and comfortable for
purposes of occupation before the construction of the tunnel and tracks, but since then
it has not only depreciated in value, but the tenant

Page 233 U. S. 550

removed therefrom, and plaintiff was obliged to occupy the house himself by reason of
his inability to rent it. The property has depreciated from a value of about $5,500 to
about $4,000, and the rental value from $30 per month to $20 per month. The furniture
and other belongings in the house have been depreciated from a value of $1,200 to
$600, all of which depreciation is due to the presence of smoke, cinders, and gases
emitted from passing trains and from the mouth of the tunnel, which smoke, cinders,
and gases enter the dwelling house and settle upon the furniture and other personal
property contained in it, contaminating the air and rendering the house objectionable as
a habitation. The house has also been damaged by vibrations caused by the movement
of trains on the track or in the tunnel, resulting in cracking the walls and wallpaper,
breaking glass in the windows, and disturbing the peace and slumber of the occupants.

The defendant, the Washington Terminal Company, is the owner of the tunnel and of the
tracks therein, but its ownership of tracks ceases at the south portal. The tracks
extending therefrom in a southwesterly direction are owned and used by other railroad
companies, but the movement of the trains is controlled by defendant.

The tunnel and the tracks leading from it across Square 693 were located and
constructed and are now maintained under the authority of Acts of Congress of
February 12, 1901, and February 28, 1903, 31 Stat. 774, c. 354; 32 Stat. 909, c. 856, in
accordance with plans and specifications approved by those acts. No claim is made by
plaintiff that the tunnel, the tracks in Square 693, and the trains operated therein and
thereon were constructed, operated, or maintained in a negligent manner, and it is
conceded that the tunnel and tracks were built upon property acquired by purchase or
condemnation proceedings, and were constructed under authority of the acts of
Congress

Page 233 U. S. 551

and of permits issued by the Commissioners of the District of Columbia.

Such being the essential facts to be deduced from the evidence, we have reached the
conclusion, for reasons presently to be stated, that with respect to most of the elements
of damage to which the plaintiff's property has been subjected, the courts below
correctly held them to be damnum absque injuria; but that with respect to such damage
as is attributable to the gases and smoke emitted from locomotive engines while in the
tunnel, and forced out of it by means of the fanning system through a portal located so
near to plaintiff's property that these gases and smoke materially contribute to injure the
furniture and to render the house less habitable than otherwise it would be, there is a
right of recovery.

The acts of Congress referred to, followed by the construction of the tunnel and railroad
tracks substantially in the mode prescribed, had the effect of legalizing the construction
and operation of the railroad, so that its operation, while properly conducted and
regulated, cannot be deemed to be a public nuisance. Yet it is sufficiently obvious that
the acts done by defendant, if done without legislative sanction, would form the subject
of an action by plaintiff to recover damages as for a private nuisance.

At the same time, there is no exclusive and permanent appropriation of any portion of
plaintiff's land, which, indeed, does not even abut upon defendant's property. The acts
of Congress do not in terms provide for the payment of compensation to property
owners damnified through the construction and operation of the tunnel and railroad lines
in question, except to those whose lands, or a portion thereof, were necessarily
appropriated. For damages, whether direct or consequential, to noncontiguous parcels
such as that of plaintiff, there is no express provision. But § 9 of the Act of 1903, 32
Stat. 916, c. 856, authorizes the Terminal Company to acquire, by purchase or
condemnation,

Page 233 U. S. 552

"the lands and property necessary for all and every the purposes contemplated" by the
several acts of Congress under which the tunnel and railroad were constructed and are
operated. This grant of the power of condemnation is very broad, but it has not been
acted upon by the company in the case of the present plaintiff. And since he is not
wholly excluded from the use and enjoyment of his property, there has been no "taking"
of the land in the ordinary sense.

The courts of England, in a series of decisions, have dealt with the general subject now
under consideration. Rex v. Pease, 4 Barn. & Ad. 30, 40, 1 Nev. & M. 690, 2 L.J. Mag.
Cas. N.S. 26, 22 Eng. Rul. Cas. 71; Vaughan v. Taff Vale R. Co., 5 Hurl. & Nor. 679, 29
L.J. Exch. 247, 1 Eng.Rul.Cas. 296; Jones v. Festiniog Ry. Co., L.R. 3 Q.B.
733; Hammersmith &c. Ry. Co. v. Brand, L.R. 4 H.L. 171, 38 L.J.Q.B. 265, 1
Eng.Rul.Cas. 623; Metropolitan Asylum District v. Hill, L.R. 6 App.Cas. 193, 201,
203; London & Brighton Ry. Co. v. Truman, L.R. 11 App.Cas. 45. The rule to be deduced
from these cases is that, while no action will lie for an invasion of private rights
necessarily resulting from the establishment and operation of railways and other public
works under the express sanction of an act of Parliament, yet that such acts are to be
strictly construed so as not to impair private rights unless the legislative purpose to do
so appears by express words or necessary implication. In short, Parliament, being
omnipotent, may authorize the taking of private property for public use without
compensation to the owner, but the courts decline to place an unjust construction upon
its acts, and will not interpret them as interfering with rights of private property unless
the language be so clear as to admit of no other meaning.

But the legislation we are dealing with must be construed in the light of the provision of
the Fifth Amendment -- "Nor shall private property be taken for public use without just
compensation" -- and is not to be given

Page 233 U. S. 553

an effect inconsistent with its letter or spirit. The doctrine of the English cases has been
generally accepted by the courts of this country, sometimes with scant regard for
distinctions growing out of the constitutional restrictions upon legislative action under
our system. Thus, it has been said that "a railroad authorized by law and lawfully
operated cannot be deemed a private nuisance;" that "what the legislature has
authorized to be done cannot be deemed unlawful," etc. These and similar expressions
have at times been indiscriminately employed with respect to public and to private
nuisances. We deem the true rule, under the Fifth Amendment, as under state
constitutions containing a similar prohibition, to be that, while the legislature may
legalize what otherwise would be a public nuisance, it may not confer immunity from
action for a private nuisance of such a character as to amount in effect to a taking of
private property for public use. Pennsylvania R. Co. v. Angel, 41 N.J.Eq. 316,
329; Costigan v. Pennsylvania R. Co., 54 N.J.L. 233; Cogswell v. N.Y., N.H. & H. R.
Co., 103 N.Y. 10; Garvey v. Long Island R. Co., 159 N.Y. 323; Bohan v. Port Jervis Gas
Light Co., 122 N.Y. 18, 29; Sadlier v. City of New York, 81 N.Y.S. 308.

But the question remains, in cases of the class now before us, what is to be deemed a
private nuisance such as amounts to a taking of property? And, by a great and
preponderant weight of judicial authority in those states whose constitutions contain a
prohibition of the taking of private property for public use without compensation,
substantially in the form employed in the Fifth Amendment, it has become established
that railroads constructed and operated for the public use, although with private capital
and for private gain, are not subject to actions in behalf of neighboring property owners
for the ordinary damages attributable to the operation of the railroad, in the absence of
negligence. Such roads are treated as
Page 233 U. S. 554

public highways, and the proprietors as public servants, with the exemption normally
enjoyed by such servants from liability to private suit, so far as concerns the incidental
damages accruing to owners of nonadjacent land through the proper and skillful
management and operation of the railways. Any diminution of the value of property not
directly invaded nor peculiarly affected, but sharing in the common burden of incidental
damages arising from the legalized nuisance, is held not to be a "taking" within the
constitutional provision. The immunity is limited to such damages as naturally and
unavoidably result from the proper conduct of the road and are shared generally by
property owners whose lands lie within range of the inconveniences necessarily incident
to proximity to a railroad. It includes the noises and vibrations incident to the running of
trains, the necessary emission of smoke and sparks from the locomotives, and similar
annoyances inseparable from the normal and nonnegligent operation of a
railroad. Transportation Co. v. Chicago,99 U. S. 635, 99 U. S. 641; Beseman v.
Pennsylvania R. Co., 50 N.J.L. 235, 240, 13 A. 164, aff'd, 52 N.J.L. 221.

That the constitutional inhibition against the taking of private property for public use
without compensation does not confer a right to compensation upon a landowner, no
part of whose property has been actually appropriated and who has sustained only
those consequential damages that are necessarily incident to proximity to the railroad,
has been so generally recognized that in some of the states (Arkansas, California,
Colorado, Georgia, Illinois, Louisiana, Mississippi, Missouri, Montana, Nebraska, North
Dakota, South Dakota, Texas, West Virginia, and Wyoming are, we believe, among the
number), constitutions have been established providing in substance that private
property shall not be taken or damagedfor public use without compensation.

The immunity from liability for incidental injuries is

Page 233 U. S. 555

attended with a considerable degree of hardship to the private landowner, and has not
been adopted without some judicial protest. But, as pointed out by Chief Justice
Beasley in the Beseman case, 50 N.J.L. at p. 238, if railroad companies were liable to
suit for such damages upon the theory that, with respect to them, the company is a
tortfeasor, the practical result would be to bring the operation of railroads to a standstill.
And, on the whole, the doctrine has become so well established that it amounts to a rule
of property, and should be modified, if at all, only by the lawmaking power.

But the doctrine, being founded upon necessity, is limited accordingly. This Court, in a
leading case that we deem controlling upon the questions now at issue, had occasion to
recognize this, and at the same time to apply the distinction between public and private
nuisances with respect to the private right of action. In Baltimore & Potomac R. Co. v.
Fifth Baptist Church, 108 U. S. 317, the Court, while recognizing (p. 108 U. S. 331) that
the legislative authority for operating a railway carried with it an immunity from private
actions based upon those incidental inconveniences that are unavoidably attendant
upon the operation of a railroad, nevertheless sustained the right of action in a case
where a building for housing and repairing locomotive engines was unnecessarily
established in close proximity to a place of public worship, and so used that the noises
of the shop and the rumbling of the locomotive engines passing in and out, the blowing
off of steam, the ringing of bells, the sound of whistles, and the smoke from the
chimneys, created a constant disturbance of the religious exercises. The Court
(speaking by Mr. Justice Field) held that the authority of the company to construct such
works as it might deem necessary and expedient for the completion and maintenance of
its road did not authorize it to place them wherever it might think proper in the city,
without reference to the property and rights

Page 233 U. S. 556

of others, and that, whatever the extent of the authority conferred, it was accompanied
with the implied qualification that the works should not be so placed as by their use to
unreasonably interfere with and disturb the peaceful and comfortable enjoyment of
others in their property. In the language of the opinion:

"Grants of privileges or powers to corporate bodies like those in question confer no

license to use them in disregard of the private rights of others, and with immunity for
their invasion."

The reasoning proceeded upon the ground (p. 108 U. S. 332) that no authority
conferred by Congress would justify an invasion of private property to an extent
amounting to an entire deprivation of its use and enjoyment without compensation to the
owner,

"nor could such authority be invoked to justify acts creating physical discomfort and
annoyance to others in the use and enjoyment of their property, to a less extent than
entire deprivation, if different places from those occupied could be used by the
corporation for its purposes, without causing such discomfort and annoyance,"

and hence that the legislative authorization conferred exemption only from suit or
prosecution for the public nuisance, and did not affect "any claim of a private citizen for
damages for any special inconvenience and discomfort not experienced by the public at
large."

The present case, in the single particular already alluded to -- that is to say, with respect
to so much of the damage as is attributable to the gases and smoke emitted from
locomotive engines while in the tunnel, and forced out of it by the fanning system
therein installed, and issuing from the portal located near to plaintiff's property in such
manner as to materially contribute to render his property less habitable than otherwise it
would be, and to depreciate it in value, and this without, so far as appears, any real
necessity existing for such damage -- is, in our opinion, within the reason and authority
of the decision just cited. This case differs from that of the Baptist Church
Page 233 U. S. 557

in that there, the railroad company was free to select some other location for the repair
shop and engine house, while here, the evidence shows that the location of the tunnel
and its south portal was established pursuant to law, and not voluntarily chosen by
defendant. This circumstance, however, does not, as we think, afford sufficient ground
for a distinction affecting the result. The case shows that Congress has authorized, and
in effect commanded, defendant to construct its tunnel with a portal located in the midst
of an inhabited portion of the city. The authority, no doubt, includes the use of steam
locomotive engines in the tunnel, with the inevitable concomitants of foul gases and
smoke emitted from the engines. No question is made but that it includes the installation
and operation of a fanning system for ridding the tunnel of this source of discomfort to
those operating the trains and traveling upon them. All this being granted, the special
and peculiar damage to the plaintiff as a property owner in close proximity to the portal
is the necessary consequence, unless, at least, it be feasible to install ventilating shafts
or other devices for preventing the outpouring of gases and smoke from the entire
length of the tunnel at a single point upon the surface, as at present. Construing the
acts of Congress in the light of the Fifth Amendment, they do not authorize the
imposition of so direct and peculiar and substantial a burden upon plaintiff's property
without compensation to him. If the damage is not preventible by the employment at
reasonable expense of devices such as have been suggested, then plaintiff's property is
"necessary for the purposes contemplated," and may be acquired by purchase or
condemnation (32 Stat. 916, c. 856, § 9), and, pending its acquisition, defendant is
responsible. If the damage is readily preventible, the statute furnishes no excuse, and
defendant's responsibility follows on general principles.

No doubt there will be some practical difficulty in distinguishing

Page 233 U. S. 558

between that part of the damage which is attributable to the gases and smoke emitted
from the locomotive engines while operated upon the railroad tracks adjacent to
plaintiff's land, and with respect to which we hold there is no right of action, and damage
that arises from the gases and smoke that issue from the tunnel, and with respect to
which there appears to be a right of action. How this difficulty is to be solved in order to
determine the damages that should be assessed in this action, or the compensation that
should be awarded in case condemnation proceedings are resorted to, is a question not
presented by this record, and upon which therefore no opinion is expressed.

Judgment reversed and cause remanded to the court of appeals, with directions to
reverse the judgment of the Supreme Court of the District and remand the cause to that
court with directions for a new trial, and for further proceedings in accordance with the
views above expressed.

MR. JUSTICE LURTON dissents.

REPUBLIC VS. VDA. DE
CASTELLVI, digested
Posted by Pius Morados on November 7, 2011

GR # L-20620 August 15, 1974 (Constitutional Law – Eminent Domain, Elements of Taking)
FACTS: After the owner of a parcel of land that has been rented and occupied by the
government in 1947 refused to extend the lease, the latter commenced expropriation
proceedings in 1959. During the assessment of just compensation, the government argued that
it had taken the property when the contract of lease commenced and not when the
proceedings begun. The owner maintains that the disputed land was not taken when the
government commenced to occupy the said land as lessee because the essential elements of
the “ taking” of property under the power of eminent domain, namely (1) entrance and
occupation by condemnor upon the private property for more than a momentary period, and (2)
devoting it to a public use in such a way as to oust the owner and deprive him of all beneficial
enjoyment of the property, are not present.

ISSUE: Whether or not the taking of property has taken place when the condemnor has
entered and occupied the property as lesse.

HELD: No, the property was deemed taken only when the expropriation proceedings
commenced in 1959.

The essential elements of the taking are: (1) Expropriator must enter a private property, (2) for
more than a momentary period, (3) and under warrant of legal authority, (4) devoting it to
public use, or otherwise informally appropriating or injuriously affecting it in such a way as (5)
substantially to oust the owner and deprive him of all beneficial enjoyment thereof.

In the case at bar, these elements were not present when the government entered and
occupied the property under a contract of lease.

G.R. No. L-20620 August 15, 1974

REPUBLIC OF THE PHILIPPINES, plaintiff-appellant,

vs.
CARMEN M. VDA. DE CASTELLVI, ET AL., defendants-appellees.

Office of the Solicitor General for plaintiff-appellant.

C.A. Mendoza & A. V. Raquiza and Alberto Cacnio & Associates for defendant-appellees.
ZALDIVAR, J.:p

Appeal from the decision of the Court of First Instance of Pampanga in its Civil Case No. 1623, an expropriation proceeding.

Plaintiff-appellant, the Republic of the Philippines, (hereinafter referred to as the Republic) filed, on
June 26, 1959, a complaint for eminent domain against defendant-appellee, Carmen M. Vda. de
Castellvi, judicial administratrix of the estate of the late Alfonso de Castellvi (hereinafter referred to
as Castellvi), over a parcel of land situated in the barrio of San Jose, Floridablanca, Pampanga,
described as follows:

A parcel of land, Lot No. 199-B Bureau of Lands Plan Swo 23666. Bounded on the
NE by Maria Nieves Toledo-Gozun; on the SE by national road; on the SW by AFP
reservation, and on the NW by AFP reservation. Containing an area of 759,299
square meters, more or less, and registered in the name of Alfonso Castellvi under
TCT No. 13631 of the Register of Pampanga ...;

and against defendant-appellee Maria Nieves Toledo Gozun (hereinafter referred to as Toledo-
Gozun over two parcels of land described as follows:

A parcel of land (Portion Lot Blk-1, Bureau of Lands Plan Psd, 26254. Bounded on
the NE by Lot 3, on the SE by Lot 3; on the SW by Lot 1-B, Blk. 2 (equivalent to Lot
199-B Swo 23666; on the NW by AFP military reservation. Containing an area of
450,273 square meters, more or less and registered in the name of Maria Nieves
Toledo-Gozun under TCT No. 8708 of the Register of Deeds of Pampanga. ..., and

A parcel of land (Portion of lot 3, Blk-1, Bureau of Lands Plan Psd 26254. Bounded
on the NE by Lot No. 3, on the SE by school lot and national road, on the SW by Lot
1-B Blk 2 (equivalent to Lot 199-B Swo 23666), on the NW by Lot 1-B, Blk-1.
Containing an area of 88,772 square meters, more or less, and registered in the
name of Maria Nieves Toledo Gozun under TCT No. 8708 of the Register of Deeds of
Pampanga, ....

In its complaint, the Republic alleged, among other things, that the fair market value of the above-
mentioned lands, according to the Committee on Appraisal for the Province of Pampanga, was not
more than P2,000 per hectare, or a total market value of P259,669.10; and prayed, that the
provisional value of the lands be fixed at P259.669.10, that the court authorizes plaintiff to take
immediate possession of the lands upon deposit of that amount with the Provincial Treasurer of
Pampanga; that the court appoints three commissioners to ascertain and report to the court the just
compensation for the property sought to be expropriated, and that the court issues thereafter a final
order of condemnation.

On June 29, 1959 the trial court issued an order fixing the provisional value of the lands at
P259,669.10.

In her "motion to dismiss" filed on July 14, 1959, Castellvi alleged, among other things, that the land
under her administration, being a residential land, had a fair market value of P15.00 per square
meter, so it had a total market value of P11,389,485.00; that the Republic, through the Armed Forces
of the Philippines, particularly the Philippine Air Force, had been, despite repeated demands, illegally
occupying her property since July 1, 1956, thereby preventing her from using and disposing of it,
thus causing her damages by way of unrealized profits. This defendant prayed that the complaint be
dismissed, or that the Republic be ordered to pay her P15.00 per square meter, or a total of
P11,389,485.00, plus interest thereon at 6% per annum from July 1, 1956; that the Republic be
ordered to pay her P5,000,000.00 as unrealized profits, and the costs of the suit.

By order of the trial court, dated August, 1959, Amparo C. Diaz, Dolores G. viuda de Gil, Paloma
Castellvi, Carmen Castellvi, Rafael Castellvi, Luis Castellvi, Natividad Castellvi de Raquiza, Jose
Castellvi and Consuelo Castellvi were allowed to intervene as parties defendants. Subsequently,
Joaquin V. Gozun, Jr., husband of defendant Nieves Toledo Gozun, was also allowed by the court to
intervene as a party defendant.

After the Republic had deposited with the Provincial Treasurer of Pampanga the amount of
P259,669.10, the trial court ordered that the Republic be placed in possession of the lands. The
Republic was actually placed in possession of the lands on August 10,
1959.1

In her "motion to dismiss", dated October 22, 1959, Toledo-Gozun alleged, among other things, that
her two parcels of land were residential lands, in fact a portion with an area of 343,303 square
meters had already been subdivided into different lots for sale to the general public, and the
remaining portion had already been set aside for expansion sites of the already completed
subdivisions; that the fair market value of said lands was P15.00 per square meter, so they had a
total market value of P8,085,675.00; and she prayed that the complaint be dismissed, or that she be
paid the amount of P8,085,675.00, plus interest thereon at the rate of 6% per annum from October
13, 1959, and attorney's fees in the amount of P50,000.00.

Intervenors Jose Castellvi and Consuelo Castellvi in their answer, filed on February 11, 1960, and
also intervenor Joaquin Gozun, Jr., husband of defendant Maria Nieves Toledo-Gozun, in his motion
to dismiss, dated May 27, 1960, all alleged that the value of the lands sought to be expropriated was
at the rate of P15.00 per square meter.

On November 4, 1959, the trial court authorized the Provincial Treasurer of Pampanga to pay
defendant Toledo-Gozun the sum of P107,609.00 as provisional value of her lands. On May 16,
2

1960 the trial Court authorized the Provincial Treasurer of Pampanga to pay defendant Castellvi the
amount of P151,859.80 as provisional value of the land under her administration, and ordered said
defendant to deposit the amount with the Philippine National Bank under the supervision of the
Deputy Clerk of Court. In another order of May 16, 1960 the trial Court entered an order of
condemnation. 3

The trial Court appointed three commissioners: Atty. Amadeo Yuzon, Clerk of Court, as
commissioner for the court; Atty. Felicisimo G. Pamandanan, counsel of the Philippine National Bank
Branch at Floridablanca, for the plaintiff; and Atty. Leonardo F. Lansangan, Filipino legal counsel at
Clark Air Base, for the defendants. The Commissioners, after having qualified themselves,
proceeded to the performance of their duties.

On March 15,1961 the Commissioners submitted their report and recommendation, wherein, after
having determined that the lands sought to be expropriated were residential lands, they
recommended unanimously that the lowest price that should be paid was P10.00 per square meter,
for both the lands of Castellvi and Toledo-Gozun; that an additional P5,000.00 be paid to Toledo-
Gozun for improvements found on her land; that legal interest on the compensation, computed from
August 10, 1959, be paid after deducting the amounts already paid to the owners, and that no
consequential damages be awarded. The Commissioners' report was objected to by all the parties
4

in the case — by defendants Castellvi and Toledo-Gozun, who insisted that the fair market value of
their lands should be fixed at P15.00 per square meter; and by the Republic, which insisted that the
price to be paid for the lands should be fixed at P0.20 per square meter.5
After the parties-defendants and intervenors had filed their respective memoranda, and the
Republic, after several extensions of time, had adopted as its memorandum its objections to the
report of the Commissioners, the trial court, on May 26, 1961, rendered its decision the dispositive
6

portion of which reads as follows:

WHEREFORE, taking into account all the foregoing circumstances, and that the
lands are titled, ... the rising trend of land values ..., and the lowered purchasing
power of the Philippine peso, the court finds that the unanimous recommendation of
the commissioners of ten (P10.00) pesos per square meter for the three lots of the
defendants subject of this action is fair and just.

xxx xxx xxx

The plaintiff will pay 6% interest per annum on the total value of the lands of
defendant Toledo-Gozun since (sic) the amount deposited as provisional value from
August 10, 1959 until full payment is made to said defendant or deposit therefor is
made in court.

In respect to the defendant Castellvi, interest at 6% per annum will also be paid by
the plaintiff to defendant Castellvi from July 1, 1956 when plaintiff commenced its
illegal possession of the Castellvi land when the instant action had not yet been
commenced to July 10, 1959 when the provisional value thereof was actually
deposited in court, on the total value of the said (Castellvi) land as herein adjudged.
The same rate of interest shall be paid from July 11, 1959 on the total value of the
land herein adjudged minus the amount deposited as provisional value, or
P151,859.80, such interest to run until full payment is made to said defendant or
deposit therefor is made in court. All the intervenors having failed to produce
evidence in support of their respective interventions, said interventions are ordered
dismissed.

The costs shall be charged to the plaintiff.

On June 21, 1961 the Republic filed a motion for a new trial and/or reconsideration, upon the
grounds of newly-discovered evidence, that the decision was not supported by the evidence, and
that the decision was against the law, against which motion defendants Castellvi and Toledo-Gozun
filed their respective oppositions. On July 8, 1961 when the motion of the Republic for new trial
and/or reconsideration was called for hearing, the Republic filed a supplemental motion for new trial
upon the ground of additional newly-discovered evidence. This motion for new trial and/or
reconsideration was denied by the court on July 12, 1961.

On July 17, 1961 the Republic gave notice of its intention to appeal from the decision of May 26,
1961 and the order of July 12, 1961. Defendant Castellvi also filed, on July 17, 1961, her notice of
appeal from the decision of the trial court.

The Republic filed various ex-parte motions for extension of time within which to file its record on
appeal. The Republic's record on appeal was finally submitted on December 6, 1961.

Defendants Castellvi and Toledo-Gozun filed not only a joint opposition to the approval of the
Republic's record on appeal, but also a joint memorandum in support of their opposition. The
Republic also filed a memorandum in support of its prayer for the approval of its record on appeal.
On December 27, 1961 the trial court issued an order declaring both the record on appeal filed by
the Republic, and the record on appeal filed by defendant Castellvi as having been filed out of time,
thereby dismissing both appeals.

On January 11, 1962 the Republic filed a "motion to strike out the order of December 27, 1961 and
for reconsideration", and subsequently an amended record on appeal, against which motion the
defendants Castellvi and Toledo-Gozun filed their opposition. On July 26, 1962 the trial court issued
an order, stating that "in the interest of expediency, the questions raised may be properly and finally
determined by the Supreme Court," and at the same time it ordered the Solicitor General to submit a
record on appeal containing copies of orders and pleadings specified therein. In an order dated
November 19, 1962, the trial court approved the Republic's record on appeal as amended.

Defendant Castellvi did not insist on her appeal. Defendant Toledo-Gozun did not appeal.

The motion to dismiss the Republic's appeal was reiterated by appellees Castellvi and Toledo-Gozun
before this Court, but this Court denied the motion.

In her motion of August 11, 1964, appellee Castellvi sought to increase the provisional value of her
land. The Republic, in its comment on Castellvi's motion, opposed the same. This Court denied
Castellvi's motion in a resolution dated October 2,1964.

The motion of appellees, Castellvi and Toledo-Gozun, dated October 6, 1969, praying that they be
authorized to mortgage the lands subject of expropriation, was denied by this Court or October 14,
1969.

On February 14, 1972, Attys. Alberto Cacnio, and Associates, counsel for the estate of the late Don
Alfonso de Castellvi in the expropriation proceedings, filed a notice of attorney's lien, stating that as
per agreement with the administrator of the estate of Don Alfonso de Castellvi they shall receive by
way of attorney's fees, "the sum equivalent to ten per centum of whatever the court may finally
decide as the expropriated price of the property subject matter of the case."

---------

Before this Court, the Republic contends that the lower court erred:

1. In finding the price of P10 per square meter of the lands subject of the instant
proceedings as just compensation;

2. In holding that the "taking" of the properties under expropriation commenced with
the filing of this action;

3. In ordering plaintiff-appellant to pay 6% interest on the adjudged value of the

Castellvi property to start from July of 1956;

4. In denying plaintiff-appellant's motion for new trial based on newly discovered

evidence.

In its brief, the Republic discusses the second error assigned as the first issue to be considered. We
shall follow the sequence of the Republic's discussion.

1. In support of the assigned error that the lower court erred in holding that the "taking" of the
properties under expropriation commenced with the filing of the complaint in this case, the Republic
argues that the "taking" should be reckoned from the year 1947 when by virtue of a special lease
agreement between the Republic and appellee Castellvi, the former was granted the "right and
privilege" to buy the property should the lessor wish to terminate the lease, and that in the event of
such sale, it was stipulated that the fair market value should be as of the time of occupancy; and that
the permanent improvements amounting to more that half a million pesos constructed during a
period of twelve years on the land, subject of expropriation, were indicative of an agreed pattern of
permanency and stability of occupancy by the Philippine Air Force in the interest of national
Security.
7

Appellee Castellvi, on the other hand, maintains that the "taking" of property under the power of
eminent domain requires two essential elements, to wit: (1) entrance and occupation by condemn or
upon the private property for more than a momentary or limited period, and (2) devoting it to a public
use in such a way as to oust the owner and deprive him of all beneficial enjoyment of the property.
This appellee argues that in the instant case the first element is wanting, for the contract of lease
relied upon provides for a lease from year to year; that the second element is also wanting, because
the Republic was paying the lessor Castellvi a monthly rental of P445.58; and that the contract of
lease does not grant the Republic the "right and privilege" to buy the premises "at the value at the
time of occupancy." 8

Appellee Toledo-Gozun did not comment on the Republic's argument in support of the second error
assigned, because as far as she was concerned the Republic had not taken possession of her lands
prior to August 10, 1959.9

In order to better comprehend the issues raised in the appeal, in so far as the Castellvi property is
concerned, it should be noted that the Castellvi property had been occupied by the Philippine Air
Force since 1947 under a contract of lease, typified by the contract marked Exh. 4-Castellvi, the
pertinent portions of which read:

CONTRACT OF LEASE

This AGREEMENT OF LEASE MADE AND ENTERED into by and between

INTESTATE ESTATE OF ALFONSO DE CASTELLVI, represented by CARMEN M.
DE CASTELLVI, Judicial Administratrix ... hereinafter called the LESSOR and THE
REPUBLIC OF THE PHILIPPINES represented by MAJ. GEN. CALIXTO DUQUE,
Chief of Staff of the ARMED FORCES OF THE PHILIPPINES, hereinafter called the
LESSEE,

WITNESSETH:

1. For and in consideration of the rentals hereinafter reserved and the mutual terms,
covenants and conditions of the parties, the LESSOR has, and by these presents
does, lease and let unto the LESSEE the following described land together with the
improvements thereon and appurtenances thereof, viz:

Un Terreno, Lote No. 27 del Plano de subdivision Psu 34752, parte de la hacienda
de Campauit, situado en el Barrio de San Jose, Municipio de Floridablanca
Pampanga. ... midiendo una extension superficial de cuatro milliones once mil cuatro
cientos trienta y cinco (4,001,435) [sic] metros cuadrados, mas o menos.

Out of the above described property, 75.93 hectares thereof are actually occupied
and covered by this contract. .
 Above lot is more particularly described in TCT No. 1016, province of
Pampanga ...

of which premises, the LESSOR warrants that he/she/they/is/are the registered owner(s) and with
full authority to execute a contract of this nature.

2. The term of this lease shall be for the period beginning July 1, 1952 the date the
premises were occupied by the PHILIPPINE AIR FORCE, AFP until June 30, 1953,
subject to renewal for another year at the option of the LESSEE or unless sooner
terminated by the LESSEE as hereinafter provided.

3. The LESSOR hereby warrants that the LESSEE shall have quiet, peaceful and
undisturbed possession of the demised premises throughout the full term or period of
this lease and the LESSOR undertakes without cost to the LESSEE to eject all
trespassers, but should the LESSOR fail to do so, the LESSEE at its option may
proceed to do so at the expense of the LESSOR. The LESSOR further agrees that
should he/she/they sell or encumber all or any part of the herein described premises
during the period of this lease, any conveyance will be conditioned on the right of the
LESSEE hereunder.

4. The LESSEE shall pay to the LESSOR as monthly rentals under this lease the
sum of FOUR HUNDRED FIFTY-FIVE PESOS & 58/100 (P455.58) ...

5. The LESSEE may, at any time prior to the termination of this lease, use the
property for any purpose or purposes and, at its own costs and expense make
alteration, install facilities and fixtures and errect additions ... which facilities or
fixtures ... so placed in, upon or attached to the said premises shall be and remain
property of the LESSEE and may be removed therefrom by the LESSEE prior to the
termination of this lease. The LESSEE shall surrender possession of the premises
upon the expiration or termination of this lease and if so required by the LESSOR,
shall return the premises in substantially the same condition as that existing at the
time same were first occupied by the AFP, reasonable and ordinary wear and tear
and damages by the elements or by circumstances over which the LESSEE has no
control excepted: PROVIDED, that if the LESSOR so requires the return of the
premises in such condition, the LESSOR shall give written notice thereof to the
LESSEE at least twenty (20) days before the termination of the lease and provided,
further, that should the LESSOR give notice within the time specified above, the
LESSEE shall have the right and privilege to compensate the LESSOR at the fair
value or the equivalent, in lieu of performance of its obligation, if any, to restore the
premises. Fair value is to be determined as the value at the time of occupancy less
fair wear and tear and depreciation during the period of this lease.

6. The LESSEE may terminate this lease at any time during the term hereof by giving
written notice to the LESSOR at least thirty (30) days in advance ...

7. The LESSEE should not be responsible, except under special legislation for any
damages to the premises by reason of combat operations, acts of GOD, the
elements or other acts and deeds not due to the negligence on the part of the
LESSEE.

8. This LEASE AGREEMENT supersedes and voids any and all agreements and
undertakings, oral or written, previously entered into between the parties covering the
 property herein leased, the same having been merged herein. This AGREEMENT
may not be modified or altered except by instrument in writing only duly signed by the
parties. 10

It was stipulated by the parties, that "the foregoing contract of lease (Exh. 4, Castellvi) is 'similar in
terms and conditions, including the date', with the annual contracts entered into from year to year
between defendant Castellvi and the Republic of the Philippines (p. 17, t.s.n., Vol. III)". It is
11

undisputed, therefore, that the Republic occupied Castellvi's land from July 1, 1947, by virtue of the
above-mentioned contract, on a year to year basis (from July 1 of each year to June 30 of the
succeeding year) under the terms and conditions therein stated.

Before the expiration of the contract of lease on June 30, 1956 the Republic sought to renew the
same but Castellvi refused. When the AFP refused to vacate the leased premises after the
termination of the contract, on July 11, 1956, Castellvi wrote to the Chief of Staff, AFP, informing the
latter that the heirs of the property had decided not to continue leasing the property in question
because they had decided to subdivide the land for sale to the general public, demanding that the
property be vacated within 30 days from receipt of the letter, and that the premises be returned in
substantially the same condition as before occupancy (Exh. 5 — Castellvi). A follow-up letter was
sent on January 12, 1957, demanding the delivery and return of the property within one month from
said date (Exh. 6 Castellvi). On January 30, 1957, Lieutenant General Alfonso Arellano, Chief of
Staff, answered the letter of Castellvi, saying that it was difficult for the army to vacate the premises
in view of the permanent installations and other facilities worth almost P500,000.00 that were
erected and already established on the property, and that, there being no other recourse, the
acquisition of the property by means of expropriation proceedings would be recommended to the
President (Exhibit "7" — Castellvi).

Defendant Castellvi then brought suit in the Court of First Instance of Pampanga, in Civil Case No.
1458, to eject the Philippine Air Force from the land. While this ejectment case was pending, the
Republic instituted these expropriation proceedings, and, as stated earlier in this opinion, the
Republic was placed in possession of the lands on August 10, 1959, On November 21, 1959, the
Court of First Instance of Pampanga, dismissed Civil Case No. 1458, upon petition of the parties, in
an order which, in part, reads as follows:

1. Plaintiff has agreed, as a matter of fact has already signed an agreement with
defendants, whereby she has agreed to receive the rent of the lands, subject matter
of the instant case from June 30, 1966 up to 1959 when the Philippine Air Force was
placed in possession by virtue of an order of the Court upon depositing the
provisional amount as fixed by the Provincial Appraisal Committee with the Provincial
Treasurer of Pampanga;

2. That because of the above-cited agreement wherein the administratrix decided to

get the rent corresponding to the rent from 1956 up to 1959 and considering that this
action is one of illegal detainer and/or to recover the possession of said land by virtue
of non-payment of rents, the instant case now has become moot and academic
and/or by virtue of the agreement signed by plaintiff, she has waived her cause of
action in the above-entitled case. 12

The Republic urges that the "taking " of Castellvi's property should be deemed as of the year 1947
by virtue of afore-quoted lease agreement. In American Jurisprudence, Vol. 26, 2nd edition, Section
157, on the subject of "Eminent Domain, we read the definition of "taking" (in eminent domain) as
follows:
 Taking' under the power of eminent domain may be defined generally as entering
upon private property for more than a momentary period, and, under the warrant or
color of legal authority, devoting it to a public use, or otherwise informally
appropriating or injuriously affecting it in such a way as substantially to oust the
owner and deprive him of all beneficial enjoyment thereof. 13

Pursuant to the aforecited authority, a number of circumstances must be present in the "taking" of
property for purposes of eminent domain.

First, the expropriator must enter a private property. This circumstance is present in the instant case,
when by virtue of the lease agreement the Republic, through the AFP, took possession of the
property of Castellvi.

Second, the entrance into private property must be for more than a momentary period. "Momentary"
means, "lasting but a moment; of but a moment's duration" (The Oxford English Dictionary, Volume
VI, page 596); "lasting a very short time; transitory; having a very brief life; operative or recurring at
every moment" (Webster's Third International Dictionary, 1963 edition.) The word "momentary" when
applied to possession or occupancy of (real) property should be construed to mean "a limited period"
— not indefinite or permanent. The aforecited lease contract was for a period of one year, renewable
from year to year. The entry on the property, under the lease, is temporary, and considered
transitory. The fact that the Republic, through the AFP, constructed some installations of a
permanent nature does not alter the fact that the entry into the land was transitory, or intended to last
a year, although renewable from year to year by consent of 'The owner of the land. By express
provision of the lease agreement the Republic, as lessee, undertook to return the premises in
substantially the same condition as at the time the property was first occupied by the AFP. It is
claimed that the intention of the lessee was to occupy the land permanently, as may be inferred from
the construction of permanent improvements. But this "intention" cannot prevail over the clear and
express terms of the lease contract. Intent is to be deduced from the language employed by the
parties, and the terms 'of the contract, when unambiguous, as in the instant case, are conclusive in
the absence of averment and proof of mistake or fraud — the question being not what the intention
was, but what is expressed in the language used. (City of Manila v. Rizal Park Co., Inc., 53 Phil. 515,
525); Magdalena Estate, Inc. v. Myrick, 71 Phil. 344, 348). Moreover, in order to judge the intention
of the contracting parties, their contemporaneous and subsequent acts shall be principally
considered (Art. 1371, Civil Code). If the intention of the lessee (Republic) in 1947 was really to
occupy permanently Castellvi's property, why was the contract of lease entered into on year to year
basis? Why was the lease agreement renewed from year to year? Why did not the Republic
expropriate this land of Castellvi in 1949 when, according to the Republic itself, it expropriated the
other parcels of land that it occupied at the same time as the Castellvi land, for the purpose of
converting them into a jet air base? It might really have been the intention of the Republic to
14

expropriate the lands in question at some future time, but certainly mere notice - much less an
implied notice — of such intention on the part of the Republic to expropriate the lands in the future
did not, and could not, bind the landowner, nor bind the land itself. The expropriation must be
actually commenced in court (Republic vs. Baylosis, et al., 96 Phil. 461, 484).

Third, the entry into the property should be under warrant or color of legal authority. This
circumstance in the "taking" may be considered as present in the instant case, because the Republic
entered the Castellvi property as lessee.

Fourth, the property must be devoted to a public use or otherwise informally appropriated or
injuriously affected. It may be conceded that the circumstance of the property being devoted to
public use is present because the property was used by the air force of the AFP.
Fifth, the utilization of the property for public use must be in such a way as to oust the owner and
deprive him of all beneficial enjoyment of the property. In the instant case, the entry of the Republic
into the property and its utilization of the same for public use did not oust Castellvi and deprive her of
all beneficial enjoyment of the property. Castellvi remained as owner, and was continuously
recognized as owner by the Republic, as shown by the renewal of the lease contract from year to
year, and by the provision in the lease contract whereby the Republic undertook to return the
property to Castellvi when the lease was terminated. Neither was Castellvi deprived of all the
beneficial enjoyment of the property, because the Republic was bound to pay, and had been paying,
Castellvi the agreed monthly rentals until the time when it filed the complaint for eminent domain on
June 26, 1959.

It is clear, therefore, that the "taking" of Catellvi's property for purposes of eminent domain cannot be
considered to have taken place in 1947 when the Republic commenced to occupy the property as
lessee thereof. We find merit in the contention of Castellvi that two essential elements in the "taking"
of property under the power of eminent domain, namely: (1) that the entrance and occupation by the
condemnor must be for a permanent, or indefinite period, and (2) that in devoting the property to
public use the owner was ousted from the property and deprived of its beneficial use, were not
present when the Republic entered and occupied the Castellvi property in 1947.

Untenable also is the Republic's contention that although the contract between the parties was one
of lease on a year to year basis, it was "in reality a more or less permanent right to occupy the
premises under the guise of lease with the 'right and privilege' to buy the property should the lessor
wish to terminate the lease," and "the right to buy the property is merged as an integral part of the
lease relationship ... so much so that the fair market value has been agreed upon, not, as of the time
of purchase, but as of the time of occupancy" We cannot accept the Republic's contention that a
15

lease on a year to year basis can give rise to a permanent right to occupy, since by express legal
provision a lease made for a determinate time, as was the lease of Castellvi's land in the instant
case, ceases upon the day fixed, without need of a demand (Article 1669, Civil Code). Neither can it
be said that the right of eminent domain may be exercised by simply leasing the premises to be
expropriated (Rule 67, Section 1, Rules of Court). Nor can it be accepted that the Republic would
enter into a contract of lease where its real intention was to buy, or why the Republic should enter
into a simulated contract of lease ("under the guise of lease", as expressed by counsel for the
Republic) when all the time the Republic had the right of eminent domain, and could expropriate
Castellvi's land if it wanted to without resorting to any guise whatsoever. Neither can we see how a
right to buy could be merged in a contract of lease in the absence of any agreement between the
parties to that effect. To sustain the contention of the Republic is to sanction a practice whereby in
order to secure a low price for a land which the government intends to expropriate (or would
eventually expropriate) it would first negotiate with the owner of the land to lease the land (for say
ten or twenty years) then expropriate the same when the lease is about to terminate, then claim that
the "taking" of the property for the purposes of the expropriation be reckoned as of the date when
the Government started to occupy the property under the lease, and then assert that the value of the
property being expropriated be reckoned as of the start of the lease, in spite of the fact that the value
of the property, for many good reasons, had in the meantime increased during the period of the
lease. This would be sanctioning what obviously is a deceptive scheme, which would have the effect
of depriving the owner of the property of its true and fair market value at the time when the
expropriation proceedings were actually instituted in court. The Republic's claim that it had the "right
and privilege" to buy the property at the value that it had at the time when it first occupied the
property as lessee nowhere appears in the lease contract. What was agreed expressly in paragraph
No. 5 of the lease agreement was that, should the lessor require the lessee to return the premises in
the same condition as at the time the same was first occupied by the AFP, the lessee would have the
"right and privilege" (or option) of paying the lessor what it would fairly cost to put the premises in the
same condition as it was at the commencement of the lease, in lieu of the lessee's performance of
the undertaking to put the land in said condition. The "fair value" at the time of occupancy, mentioned
in the lease agreement, does not refer to the value of the property if bought by the lessee, but refers
to the cost of restoring the property in the same condition as of the time when the lessee took
possession of the property. Such fair value cannot refer to the purchase price, for purchase was
never intended by the parties to the lease contract. It is a rule in the interpretation of contracts that
"However general the terms of a contract may be, they shall not be understood to comprehend
things that are distinct and cases that are different from those upon which the parties intended to
agree" (Art. 1372, Civil Code).

We hold, therefore, that the "taking" of the Castellvi property should not be reckoned as of the year
1947 when the Republic first occupied the same pursuant to the contract of lease, and that the just
compensation to be paid for the Castellvi property should not be determined on the basis of the
value of the property as of that year. The lower court did not commit an error when it held that the
"taking" of the property under expropriation commenced with the filing of the complaint in this case.

Under Section 4 of Rule 67 of the Rules of Court, the "just compensation" is to be determined as of
16

the date of the filing of the complaint. This Court has ruled that when the taking of the property
sought to be expropriated coincides with the commencement of the expropriation proceedings, or
takes place subsequent to the filing of the complaint for eminent domain, the just compensation
should be determined as of the date of the filing of the complaint. (Republic vs. Philippine National
Bank, L-14158, April 12, 1961, 1 SCRA 957, 961-962). In the instant case, it is undisputed that the
Republic was placed in possession of the Castellvi property, by authority of the court, on August 10,
1959. The "taking" of the Castellvi property for the purposes of determining the just compensation to
be paid must, therefore, be reckoned as of June 26, 1959 when the complaint for eminent domain
was filed.

Regarding the two parcels of land of Toledo-Gozun, also sought to be expropriated, which had never
been under lease to the Republic, the Republic was placed in possession of said lands, also by
authority of the court, on August 10, 1959, The taking of those lands, therefore, must also be
reckoned as of June 26, 1959, the date of the filing of the complaint for eminent domain.

2. Regarding the first assigned error — discussed as the second issue — the Republic maintains
that, even assuming that the value of the expropriated lands is to be determined as of June 26,
1959, the price of P10.00 per square meter fixed by the lower court "is not only exhorbitant but also
unconscionable, and almost fantastic". On the other hand, both Castellvi and Toledo-Gozun maintain
that their lands are residential lands with a fair market value of not less than P15.00 per square
meter.

The lower court found, and declared, that the lands of Castellvi and Toledo-Gozun are residential
lands. The finding of the lower court is in consonance with the unanimous opinion of the three
commissioners who, in their report to the court, declared that the lands are residential lands.

The Republic assails the finding that the lands are residential, contending that the plans of the
appellees to convert the lands into subdivision for residential purposes were only on paper, there
being no overt acts on the part of the appellees which indicated that the subdivision project had been
commenced, so that any compensation to be awarded on the basis of the plans would be
speculative. The Republic's contention is not well taken. We find evidence showing that the lands in
question had ceased to be devoted to the production of agricultural crops, that they had become
adaptable for residential purposes, and that the appellees had actually taken steps to convert their
lands into residential subdivisions even before the Republic filed the complaint for eminent domain.
In the case of City of Manila vs. Corrales (32 Phil. 82, 98) this Court laid down basic guidelines in
determining the value of the property expropriated for public purposes. This Court said:
 In determining the value of land appropriated for public purposes, the same
consideration are to be regarded as in a sale of property between private parties.
The inquiry, in such cases, must be what is the property worth in the market, viewed
not merely with reference to the uses to which it is at the time applied, but with
reference to the uses to which it is plainly adapted, that is to say, What is it worth
from its availability for valuable uses?

So many and varied are the circumstances to be taken into account in determining
the value of property condemned for public purposes, that it is practically impossible
to formulate a rule to govern its appraisement in all cases. Exceptional
circumstances will modify the most carefully guarded rule, but, as a general thing, we
should say that the compensation of the owner is to be estimated by reference to the
use for which the property is suitable, having regard to the existing business or wants
of the community, or such as may be reasonably expected in the immediate future.
(Miss. and Rum River Boom Co. vs. Patterson, 98 U.S., 403).

In expropriation proceedings, therefore, the owner of the land has the right to its value for the use for
which it would bring the most in the market. The owner may thus show every advantage that his
17

property possesses, present and prospective, in order that the price it could be sold for in the market
may be satisfactorily determined. The owner may also show that the property is suitable for division
18

into village or town lots.19

The trial court, therefore, correctly considered, among other circumstances, the proposed
subdivision plans of the lands sought to be expropriated in finding that those lands are residential
lots. This finding of the lower court is supported not only by the unanimous opinion of the
commissioners, as embodied in their report, but also by the Provincial Appraisal Committee of the
province of Pampanga composed of the Provincial Treasurer, the Provincial Auditor and the District
Engineer. In the minutes of the meeting of the Provincial Appraisal Committee, held on May 14, 1959
(Exh. 13-Castellvi) We read in its Resolution No. 10 the following:

3. Since 1957 the land has been classified as residential in view of its proximity to the
air base and due to the fact that it was not being devoted to agriculture. In fact, there
is a plan to convert it into a subdivision for residential purposes. The taxes due on
the property have been paid based on its classification as residential land;

The evidence shows that Castellvi broached the idea of subdividing her land into residential lots as
early as July 11, 1956 in her letter to the Chief of Staff of the Armed Forces of the Philippines. (Exh.
5-Castellvi) As a matter of fact, the layout of the subdivision plan was tentatively approved by the
National Planning Commission on September 7, 1956. (Exh. 8-Castellvi). The land of Castellvi had
not been devoted to agriculture since 1947 when it was leased to the Philippine Army. In 1957 said
land was classified as residential, and taxes based on its classification as residential had been paid
since then (Exh. 13-Castellvi). The location of the Castellvi land justifies its suitability for a residential
subdivision. As found by the trial court, "It is at the left side of the entrance of the Basa Air Base and
bounded on two sides by roads (Exh. 13-Castellvi), paragraphs 1 and 2, Exh. 12-Castellvi), the
poblacion, (of Floridablanca) the municipal building, and the Pampanga Sugar Mills are closed by.
The barrio schoolhouse and chapel are also near (T.S.N. November 23,1960, p. 68)." 20

The lands of Toledo-Gozun (Lot 1-B and Lot 3) are practically of the same condition as the land of
Castellvi. The lands of Toledo-Gozun adjoin the land of Castellvi. They are also contiguous to the
Basa Air Base, and are along the road. These lands are near the barrio schoolhouse, the barrio
chapel, the Pampanga Sugar Mills, and the poblacion of Floridablanca (Exhs. 1, 3 and 4-Toledo-
Gozun). As a matter of fact, regarding lot 1-B it had already been surveyed and subdivided, and its
conversion into a residential subdivision was tentatively approved by the National Planning
Commission on July 8, 1959 (Exhs. 5 and 6 Toledo-Gozun). As early as June, 1958, no less than 32
man connected with the Philippine Air Force among them commissioned officers, non-commission
officers, and enlisted men had requested Mr. and Mrs. Joaquin D. Gozun to open a subdivision on
their lands in question (Exhs. 8, 8-A to 8-ZZ-Toledo-Gozun). 21

We agree with the findings, and the conclusions, of the lower court that the lands that are the subject
of expropriation in the present case, as of August 10, 1959 when the same were taken possession of
by the Republic, were residential lands and were adaptable for use as residential subdivisions.
Indeed, the owners of these lands have the right to their value for the use for which they would bring
the most in the market at the time the same were taken from them. The most important issue to be
resolved in the present case relates to the question of what is the just compensation that should be
paid to the appellees.

The Republic asserts that the fair market value of the lands of the appellees is P.20 per square
meter. The Republic cites the case of Republic vs. Narciso, et al., L-6594, which this Court decided
on May 18, 1956. The Narciso case involved lands that belonged to Castellvi and Toledo-Gozun, and
to one Donata Montemayor, which were expropriated by the Republic in 1949 and which are now the
site of the Basa Air Base. In the Narciso case this Court fixed the fair market value at P.20 per
square meter. The lands that are sought to be expropriated in the present case being contiguous to
the lands involved in the Narciso case, it is the stand of the Republic that the price that should be
fixed for the lands now in question should also be at P.20 per square meter.

We can not sustain the stand of the Republic. We find that the price of P.20 per square meter, as
fixed by this Court in the Narciso case, was based on the allegation of the defendants (owners) in
their answer to the complaint for eminent domain in that case that the price of their lands was
P2,000.00 per hectare and that was the price that they asked the court to pay them. This Court said,
then, that the owners of the land could not be given more than what they had asked, notwithstanding
the recommendation of the majority of the Commission on Appraisal — which was adopted by the
trial court — that the fair market value of the lands was P3,000.00 per hectare. We also find that the
price of P.20 per square meter in the Narciso case was considered the fair market value of the lands
as of the year 1949 when the expropriation proceedings were instituted, and at that time the lands
were classified as sugar lands, and assessed for taxation purposes at around P400.00 per hectare,
or P.04 per square meter. 22 While the lands involved in the present case, like the lands involved in
the Narciso case, might have a fair market value of P.20 per square meter in 1949, it can not be
denied that ten years later, in 1959, when the present proceedings were instituted, the value of those
lands had increased considerably. The evidence shows that since 1949 those lands were no longer
cultivated as sugar lands, and in 1959 those lands were already classified, and assessed for taxation
purposes, as residential lands. In 1959 the land of Castellvi was assessed at P1.00 per square
meter. 23

The Republic also points out that the Provincial Appraisal Committee of Pampanga, in its resolution
No. 5 of February 15, 1957 (Exhibit D), recommended the sum of P.20 per square meter as the fair
valuation of the Castellvi property. We find that this resolution was made by the Republic the basis in
asking the court to fix the provisional value of the lands sought to be expropriated at P259,669.10,
which was approved by the court. It must be considered, however, that the amount fixed as the
24

provisional value of the lands that are being expropriated does not necessarily represent the true
and correct value of the land. The value is only "provisional" or "tentative", to serve as the basis for
the immediate occupancy of the property being expropriated by the condemnor. The records show
that this resolution No. 5 was repealed by the same Provincial Committee on Appraisal in its
resolution No. 10 of May 14, 1959 (Exhibit 13-Castellvi). In that resolution No. 10, the appraisal
committee stated that "The Committee has observed that the value of the land in this locality has
increased since 1957 ...", and recommended the price of P1.50 per square meter. It follows,
therefore, that, contrary to the stand of the Republic, that resolution No. 5 of the Provincial Appraisal
Committee can not be made the basis for fixing the fair market value of the lands of Castellvi and
Toledo-Gozun.

The Republic further relied on the certification of the Acting Assistant Provincial Assessor of
Pampanga, dated February 8, 1961 (Exhibit K), to the effect that in 1950 the lands of Toledo-Gozun
were classified partly as sugar land and partly as urban land, and that the sugar land was assessed
at P.40 per square meter, while part of the urban land was assessed at P.40 per square meter and
part at P.20 per square meter; and that in 1956 the Castellvi land was classified as sugar land and
was assessed at P450.00 per hectare, or P.045 per square meter. We can not also consider this
certification of the Acting Assistant Provincial Assessor as a basis for fixing the fair market value of
the lands of Castellvi and Toledo-Gozun because, as the evidence shows, the lands in question, in
1957, were already classified and assessed for taxation purposes as residential lands. The
certification of the assessor refers to the year 1950 as far as the lands of Toledo-Gozun are
concerned, and to the year 1956 as far as the land of Castellvi is concerned. Moreover, this Court
has held that the valuation fixed for the purposes of the assessment of the land for taxation purposes
can not bind the landowner where the latter did not intervene in fixing it.25

On the other hand, the Commissioners, appointed by the court to appraise the lands that were being
expropriated, recommended to the court that the price of P10.00 per square meter would be the fair
market value of the lands. The commissioners made their recommendation on the basis of their
observation after several ocular inspections of the lands, of their own personal knowledge of land
values in the province of Pampanga, of the testimonies of the owners of the land, and other
witnesses, and of documentary evidence presented by the appellees. Both Castellvi and Toledo-
Gozun testified that the fair market value of their respective land was at P15.00 per square meter.
The documentary evidence considered by the commissioners consisted of deeds of sale of
residential lands in the town of San Fernando and in Angeles City, in the province of Pampanga,
which were sold at prices ranging from P8.00 to P20.00 per square meter (Exhibits 15, 16, 17, 18,
19, 20, 21, 22, 23-Castellvi). The commissioners also considered the decision in Civil Case No. 1531
of the Court of First Instance of Pampanga, entitled Republic vs. Sabina Tablante, which was
expropriation case filed on January 13, 1959, involving a parcel of land adjacent to the Clark Air
Base in Angeles City, where the court fixed the price at P18.00 per square meter (Exhibit 14-
Castellvi). In their report, the commissioners, among other things, said:

... This expropriation case is specially pointed out, because the circumstances and
factors involved therein are similar in many respects to the defendants' lands in this
case. The land in Civil Case No. 1531 of this Court and the lands in the present case
(Civil Case No. 1623) are both near the air bases, the Clark Air Base and the Basa
Air Base respectively. There is a national road fronting them and are situated in a
first-class municipality. As added advantage it may be said that the Basa Air Base
land is very near the sugar mill at Del Carmen, Floridablanca, Pampanga, owned by
the Pampanga Sugar Mills. Also just stone's throw away from the same lands is a
beautiful vacation spot at Palacol, a sitio of the town of Floridablanca, which counts
with a natural swimming pool for vacationists on weekends. These advantages are
not found in the case of the Clark Air Base. The defendants' lands are nearer to the
poblacion of Floridablanca then Clark Air Base is nearer (sic) to the poblacion of
Angeles, Pampanga.

The deeds of absolute sale, according to the undersigned commissioners, as well as

the land in Civil Case No. 1531 are competent evidence, because they were
executed during the year 1959 and before August 10 of the same year. More
 specifically so the land at Clark Air Base which coincidentally is the subject matter in
the complaint in said Civil Case No. 1531, it having been filed on January 13, 1959
and the taking of the land involved therein was ordered by the Court of First Instance
of Pampanga on January 15, 1959, several months before the lands in this case
were taken by the plaintiffs ....

From the above and considering further that the lowest as well as the highest price
per square meter obtainable in the market of Pampanga relative to subdivision lots
within its jurisdiction in the year 1959 is very well known by the Commissioners, the
Commission finds that the lowest price that can be awarded to the lands in question
is P10.00 per square meter. 26

The lower court did not altogether accept the findings of the Commissioners based on the
documentary evidence, but it considered the documentary evidence as basis for comparison in
determining land values. The lower court arrived at the conclusion that "the unanimous
recommendation of the commissioners of ten (P10.00) pesos per square meter for the three lots of
the defendants subject of this action is fair and just". In arriving at its conclusion, the lower court
27

took into consideration, among other circumstances, that the lands are titled, that there is a rising
trend of land values, and the lowered purchasing power of the Philippine peso.

In the case of Manila Railroad Co. vs. Caligsihan, 40 Phil. 326, 328, this Court said:

A court of first instance or, on appeal, the Supreme Court, may change or modify the
report of the commissioners by increasing or reducing the amount of the award if the
facts of the case so justify. While great weight is attached to the report of the
commissioners, yet a court may substitute therefor its estimate of the value of the
property as gathered from the record in certain cases, as, where the commissioners
have applied illegal principles to the evidence submitted to them, or where they have
disregarded a clear preponderance of evidence, or where the amount allowed is
either palpably inadequate or excessive. 28

The report of the commissioners of appraisal in condemnation proceedings are not binding, but
merely advisory in character, as far as the court is concerned. In our analysis of the report of the
29

commissioners, We find points that merit serious consideration in the determination of the just
compensation that should be paid to Castellvi and Toledo-Gozun for their lands. It should be noted
that the commissioners had made ocular inspections of the lands and had considered the nature and
similarities of said lands in relation to the lands in other places in the province of Pampanga, like San
Fernando and Angeles City. We cannot disregard the observations of the commissioners regarding
the circumstances that make the lands in question suited for residential purposes — their location
near the Basa Air Base, just like the lands in Angeles City that are near the Clark Air Base, and the
facilities that obtain because of their nearness to the big sugar central of the Pampanga Sugar mills,
and to the flourishing first class town of Floridablanca. It is true that the lands in question are not in
the territory of San Fernando and Angeles City, but, considering the facilities of modern
communications, the town of Floridablanca may be considered practically adjacent to San Fernando
and Angeles City. It is not out of place, therefore, to compare the land values in Floridablanca to the
land values in San Fernando and Angeles City, and form an idea of the value of the lands in
Floridablanca with reference to the land values in those two other communities.

The important factor in expropriation proceeding is that the owner is awarded the just compensation
for his property. We have carefully studied the record, and the evidence, in this case, and after
considering the circumstances attending the lands in question We have arrived at the conclusion
that the price of P10.00 per square meter, as recommended by the commissioners and adopted by
the lower court, is quite high. It is Our considered view that the price of P5.00 per square meter
would be a fair valuation of the lands in question and would constitute a just compensation to the
owners thereof. In arriving at this conclusion We have particularly taken into consideration the
resolution of the Provincial Committee on Appraisal of the province of Pampanga informing, among
others, that in the year 1959 the land of Castellvi could be sold for from P3.00 to P4.00 per square
meter, while the land of Toledo-Gozun could be sold for from P2.50 to P3.00 per square meter. The
Court has weighed all the circumstances relating to this expropriations proceedings, and in fixing the
price of the lands that are being expropriated the Court arrived at a happy medium between the price
as recommended by the commissioners and approved by the court, and the price advocated by the
Republic. This Court has also taken judicial notice of the fact that the value of the Philippine peso
has considerably gone down since the year 1959. Considering that the lands of Castellvi and
30

Toledo-Gozun are adjoining each other, and are of the same nature, the Court has deemed it proper
to fix the same price for all these lands.

3. The third issue raised by the Republic relates to the payment of interest. The
Republic maintains that the lower court erred when it ordered the Republic to pay
Castellvi interest at the rate of 6% per annum on the total amount adjudged as the
value of the land of Castellvi, from July 1, 1956 to July 10, 1959. We find merit in this
assignment of error.

In ordering the Republic to pay 6% interest on the total value of the land of Castellvi from July 1,
1956 to July 10, 1959, the lower court held that the Republic had illegally possessed the land of
Castellvi from July 1, 1956, after its lease of the land had expired on June 30, 1956, until August 10,
1959 when the Republic was placed in possession of the land pursuant to the writ of possession
issued by the court. What really happened was that the Republic continued to occupy the land of
Castellvi after the expiration of its lease on June 30, 1956, so much so that Castellvi filed an
ejectment case against the Republic in the Court of First Instance of Pampanga. However, while
31

that ejectment case was pending, the Republic filed the complaint for eminent domain in the present
case and was placed in possession of the land on August 10, 1959, and because of the institution of
the expropriation proceedings the ejectment case was later dismissed. In the order dismissing the
ejectment case, the Court of First Instance of Pampanga said:

Plaintiff has agreed, as a matter of fact has already signed an agreement with
defendants, whereby she had agreed to receive the rent of the lands, subject matter
of the instant case from June 30, 1956 up to 1959 when the Philippine Air Force was
placed in possession by virtue of an order of the Court upon depositing the
provisional amount as fixed by the Provincial Appraisal Committee with the Provincial
Treasurer of
Pampanga; ...

If Castellvi had agreed to receive the rentals from June 30, 1956 to August 10, 1959, she should be
considered as having allowed her land to be leased to the Republic until August 10, 1959, and she
could not at the same time be entitled to the payment of interest during the same period on the
amount awarded her as the just compensation of her land. The Republic, therefore, should pay
Castellvi interest at the rate of 6% per annum on the value of her land, minus the provisional value
that was deposited, only from July 10, 1959 when it deposited in court the provisional value of the
land.

4. The fourth error assigned by the Republic relates to the denial by the lower court of its motion for
a new trial based on nearly discovered evidence. We do not find merit in this assignment of error.
After the lower court had decided this case on May 26, 1961, the Republic filed a motion for a new
trial, supplemented by another motion, both based upon the ground of newly discovered evidence.
The alleged newly discovered evidence in the motion filed on June 21, 1961 was a deed of absolute
sale-executed on January 25, 1961, showing that a certain Serafin Francisco had sold to Pablo L.
Narciso a parcel of sugar land having an area of 100,000 square meters with a sugar quota of 100
piculs, covered by P.A. No. 1701, situated in Barrio Fortuna, Floridablanca, for P14,000, or P.14 per
square meter.

In the supplemental motion, the alleged newly discovered evidence were: (1) a deed of sale of some
35,000 square meters of land situated at Floridablanca for P7,500.00 (or about P.21 per square
meter) executed in July, 1959, by the spouses Evelyn D. Laird and Cornelio G. Laird in favor of
spouses Bienvenido S. Aguas and Josefina Q. Aguas; and (2) a deed of absolute sale of a parcel of
land having an area of 4,120,101 square meters, including the sugar quota covered by Plantation
Audit No. 161 1345, situated at Floridablanca, Pampanga, for P860.00 per hectare (a little less than
P.09 per square meter) executed on October 22, 1957 by Jesus Toledo y Mendoza in favor of the
Land Tenure Administration.

We find that the lower court acted correctly when it denied the motions for a new trial.

To warrant the granting of a new trial based on the ground of newly discovered evidence, it must
appear that the evidence was discovered after the trial; that even with the exercise of due diligence,
the evidence could not have been discovered and produced at the trial; and that the evidence is of
such a nature as to alter the result of the case if admitted. The lower court correctly ruled that these
32

requisites were not complied with.

The lower court, in a well-reasoned order, found that the sales made by Serafin Francisco to Pablo
Narciso and that made by Jesus Toledo to the Land Tenure Administration were immaterial and
irrelevant, because those sales covered sugarlands with sugar quotas, while the lands sought to be
expropriated in the instant case are residential lands. The lower court also concluded that the land
sold by the spouses Laird to the spouses Aguas was a sugar land.

We agree with the trial court. In eminent domain proceedings, in order that evidence as to the sale
price of other lands may be admitted in evidence to prove the fair market value of the land sought to
be expropriated, the lands must, among other things, be shown to be similar.

But even assuming, gratia argumenti, that the lands mentioned in those deeds of sale were
residential, the evidence would still not warrant the grant of a new trial, for said evidence could have
been discovered and produced at the trial, and they cannot be considered newly discovered
evidence as contemplated in Section 1(b) of Rule 37 of the Rules of Court. Regarding this point, the
trial court said:

The Court will now show that there was no reasonable diligence employed.

The land described in the deed of sale executed by Serafin Francisco, copy of which
is attached to the original motion, is covered by a Certificate of Title issued by the
Office of the Register of Deeds of Pampanga. There is no question in the mind of the
court but this document passed through the Office of the Register of Deeds for the
purpose of transferring the title or annotating the sale on the certificate of title. It is
true that Fiscal Lagman went to the Office of the Register of Deeds to check
conveyances which may be presented in the evidence in this case as it is now
sought to be done by virtue of the motions at bar, Fiscal Lagman, one of the lawyers
of the plaintiff, did not exercise reasonable diligence as required by the rules. The
 assertion that he only went to the office of the Register of Deeds 'now and then' to
check the records in that office only shows the half-hazard [sic] manner by which the
plaintiff looked for evidence to be presented during the hearing before the
Commissioners, if it is at all true that Fiscal Lagman did what he is supposed to have
done according to Solicitor Padua. It would have been the easiest matter for plaintiff
to move for the issuance of a subpoena duces tecum directing the Register of Deeds
of Pampanga to come to testify and to bring with him all documents found in his
office pertaining to sales of land in Floridablanca adjacent to or near the lands in
question executed or recorded from 1958 to the present. Even this elementary
precaution was not done by plaintiff's numerous attorneys.

The same can be said of the deeds of sale attached to the supplementary motion.
They refer to lands covered by certificate of title issued by the Register of Deeds of
Pampanga. For the same reason they could have been easily discovered if
reasonable diligence has been exerted by the numerous lawyers of the plaintiff in this
case. It is noteworthy that all these deeds of sale could be found in several
government offices, namely, in the Office of the Register of Deeds of Pampanga, the
Office of the Provincial Assessor of Pampanga, the Office of the Clerk of Court as a
part of notarial reports of notaries public that acknowledged these documents, or in
the archives of the National Library. In respect to Annex 'B' of the supplementary
motion copy of the document could also be found in the Office of the Land Tenure
Administration, another government entity. Any lawyer with a modicum of ability
handling this expropriation case would have right away though [sic] of digging up
documents diligently showing conveyances of lands near or around the parcels of
land sought to be expropriated in this case in the offices that would have naturally
come to his mind such as the offices mentioned above, and had counsel for the
movant really exercised the reasonable diligence required by the Rule' undoubtedly
they would have been able to find these documents and/or caused the issuance of
subpoena duces tecum. ...

It is also recalled that during the hearing before the Court of the Report and
Recommendation of the Commissioners and objection thereto, Solicitor Padua made
the observation:

I understand, Your Honor, that there was a sale that took place in this place of land
recently where the land was sold for P0.20 which is contiguous to this land.

The Court gave him permission to submit said document subject to the approval of
the Court. ... This was before the decision was rendered, and later promulgated on
May 26, 1961 or more than one month after Solicitor Padua made the above
observation. He could have, therefore, checked up the alleged sale and moved for a
reopening to adduce further evidence. He did not do so. He forgot to present the
evidence at a more propitious time. Now, he seeks to introduce said evidence under
the guise of newly-discovered evidence. Unfortunately the Court cannot classify it as
newly-discovered evidence, because tinder the circumstances, the correct
qualification that can be given is 'forgotten evidence'. Forgotten however, is not
newly-discovered
evidence. 33

The granting or denial of a motion for new trial is, as a general rule, discretionary with the trial court,
whose judgment should not be disturbed unless there is a clear showing of abuse of discretion. We 34
do not see any abuse of discretion on the part of the lower court when it denied the motions for a
new trial.

WHEREFORE, the decision appealed from is modified, as follows:

(a) the lands of appellees Carmen Vda. de Castellvi and Maria Nieves Toledo-Gozun,
as described in the complaint, are declared expropriated for public use;

(b) the fair market value of the lands of the appellees is fixed at P5.00 per square
meter;

(c) the Republic must pay appellee Castellvi the sum of P3,796,495.00 as just
compensation for her one parcel of land that has an area of 759,299 square meters,
minus the sum of P151,859.80 that she withdrew out of the amount that was
deposited in court as the provisional value of the land, with interest at the rate of 6%
per annum from July 10, 1959 until the day full payment is made or deposited in
court;

(d) the Republic must pay appellee Toledo-Gozun the sum of P2,695,225.00 as the
just compensation for her two parcels of land that have a total area of 539,045
square meters, minus the sum of P107,809.00 that she withdrew out of the amount
that was deposited in court as the provisional value of her lands, with interest at the
rate of 6%, per annum from July 10, 1959 until the day full payment is made or
deposited in court; (e) the attorney's lien of Atty. Alberto Cacnio is enforced; and

(f) the costs should be paid by appellant Republic of the Philippines, as provided in
Section 12, Rule 67, and in Section 13, Rule 141, of the Rules of Court.

IT IS SO ORDERED.

Makalintal, C.J., Barredo, Antonio, Esguerra, Fernandez, Muñoz Palma and Aquino, JJ., concur.

Castro, Fernando, Teehankee and Makasiar, JJ., took no part.

Visayan Refining Company v. Camus et. al

G.R. L-15870

Facts:
Upon the direction of the Governor-General, the Attorney-General
filed a complaint with the CFI (Rizal) in the name of the
Government of the Philippines for the condemnation of a
certain tract of land in Paranaque for military and aviation
purposes. The petitioners herein are among the defendants
named. Likewise, it was prayed that the court will give the
Government the possession of the land to be expropriated after
the necessary deposit (provisional) of P600, 000.00 as the total
value of the property. Through the order of the public
respondent, Judge Camus, the prayer was granted.

During the pendency of the proceedings, the petitioners raised a demurrer

questioning the validity of the proceedings on the ground that there
is no law authorizing the exercise of the power of eminent domain.
Likewise, they moved for the revocation of the order on the same
ground stated and with additional allegation that the deposit had
been made without authority of law since the money was taken from
the unexpended balance of the funds appropriated by previous
statutes for the use of the Militia Commission and the authority for
the exercise of the power of eminent domain could not be found in
those statutes. The demurrer and motion were overruled and denied
respectively by Camus. This prompted the petitioners to file this
instant petition to stop the proceedings in the CFI.

Issue:
Can the Philippine Government initiate expropriation proceedings in the
absence of a statute authorizing the exercise of the power of
eminent domain?

Held:
Yes, it can. The Philippine Government has the general authority to
exercise the power of eminent domain as expressly conferred by
Section 63 of the Philippine Bill (Act of Congress of July 1, 1902). It
says that the Philippine Government is authorized to acquire,
receive, hold, maintain, and convey title to real and personal
property, and may acquire real estate for public uses by the exercise
of the right to eminent domain.

The same is subject to the limitation of due process of law. In consonance

with this, Section 64 of the Administrative Code of the Philippine
Islands (Act No. 2711) expressly confers on the Government
General the power to determine when it is necessary or
advantageous to exercise the right of eminent domain in behalf of
the Government of the Philippine Island; and to direct the Attorney-
General, where such at is deemed advisable, to cause the
condemnation proceedings to be begun in the court having proper
jurisdiction. There is no question as to the Governor General ’s
authority to exercise this power.
However, this authority is not absolute. It is subject to two limitations,
namely, that the taking shall be for public purpose and there must be
just compensation.
Apparently, the reason behind the taking of the subject land was for military
and aviation purposes. This considered a public purpose given the
importance of the military and aviation in the operation of the State.

As to the second requirement, it must be remembered that at that time

there was no law requiring that compensation shall actually be paid
prior to the judgment of condemnation. The deposit was made,
despite the absence of said law, to afford absolute assurance that
no piece of land can be finally and irrevocably taken from an
unwilling owner until compensation is paid.

This is in conformity with the just compensation requirement.

Given these reasons, the proceedings were made in accordance with law.
Petition is denied. Proceedings of the lower court were in all respects
regular and within the jurisdiction of the court.
G.R. No. L-15870 December 3, 1919

VISAYAN REFINING COMPANY, DEAN C. WORCESTER, and FRED A. LEAS, petitioners,

vs.
HON. MANUEL CAMUS, Judge of the Court of First Instance of the Province of Rizal and
HON. QUINTIN PAREDES, Attorney-General of the Philippine Islands, respondents.

Kincaid and Perkins for petitioners.

Assistant Attorney-General Reyes for respondents.

STREET, J.:

This is an original petition, directed to the Supreme Court, containing an alternative prayer for a writ
of certiorari or prohibition, as the facts may warrant, to stop certain condemnation proceedings
instituted by the Government of the Philippine Islands, and now pending in the Court of First
Instance of the Province of Rizal. The respondents have interposed what is called an answer, but
which is in legal effect merely a demurrer, challenging the sufficiency of the allegations of the
petition. The matter having been submitted upon oral argument, the cause is now before us for the
decision of the question thus presented.

It appears that upon September 13, 1919, the Governor-General directed the Attorney-General to
cause condemnation proceedings to be begun for the purpose of expropriating a tract of land of an
area of about 1,100,463 square meters, commonly known as the site of Camp Tomas Claudio. Said
land is located in the municipality of Parañaque, Province of Rizal, and lies along the water front of
Manila Bay, a few miles south of the city of Manila. It is stated in communication of the Governor-
General that the property in question is desired by the Government of the Philippine Islands for
military and aviation purposes.

In conformity with the instructions of the Governor-General, condemnation proceedings were begun
by the Attorney-General on September 15, 1919, by filing a complaint in the name of the
Government of the Philippine Islands in the Court of First Instance of the Province of Rizal.
Numerous persons are named in the complaint as defendants because of their supposed ownership
of portions of the property intended to be expropriated. In the list of persons thus impleaded appear
the names of the three petitioners herein, namely, the Visayan Refining Co., Dean C. Worcester, and
Fred A. Leas, who are severally owners of different portions of the property in question.

In the communication of the Governor-General, the Attorney-General was directed immediately upon
filing the complaint to ask the court to give the Government the possession of the land to be
expropriated, after the necessary deposit should be made as provided by law. Accordingly in the
complaint itself the Attorney-General prayed the court promptly and provisionally to fix the sum of
P600,000 as the total value of the property and to put the Government in immediate possession
when said sum should be placed at the disposition of the court. An order was accordingly made on
September 15, 1919, by the Honorable Judge Manuel Camus, of the Court of First Instance of the
Province of Rizal, fixing the value of the property provisionally at the amount stated and ordering that
the plaintiff be placed in possession, it being made to appear that a certificate of deposit for the
amount stated had been delivered to the provincial treasurer.

At this stage of the proceedings in the Court of First Instance the three respondents already
mentioned, to wit, the Visayan Refining Co., Dean C. Worcester, and Fred A. Leas, interposed a
demurrer, questioning the validity of the proceedings on the ground that there is no Act of the
Philippine Legislature authorizing the exercise of the power of eminent domain to acquire land for
military or aviation purposes.
Contemporaneously with the filing of their demurrer, the same parties moved the Court of First
Instance to revoke its order of September 15, giving the plaintiff provisional possession. This motion
is based substantially on the same ground as the demurrer, that is, the lack of legislative authority for
the proposed expropriation, but it contains one additional allegation to the effect that the deposit in
court of the sum of P600,000, had been made without authority of law. In support of this contention it
was shown, by means of an informal communication from the Insular Auditor, that the money in
question had been taken from the unexpended balance of the funds appropriated by Acts Nos. 2748
and 2785 of the Philippine Legislature for the use of the Militia Commission. This appropriation
showed, upon the date said deposit of P600,000 was made, an unexpended balance of
P1,144,672.83.

On October 3, 1919, the Judge of the Court of First Instance overruled the demurrer interposed by
the three parties mentioned and denied their motion to vacate the order granting possession to the
Government. The present proceeding was thereupon instituted in this Court in the manner and for
the purpose already stated.

General authority to exercise the power of eminent domain is expressly conferred on the
Government of the Philippine Islands, as now constituted by section 63 of the Philippine Bill, which
reads as follows:

That the Government of the Philippine Islands is hereby authorized, subject to the limitation
and conditions prescribed in this Act to acquire, receive, 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 3 of the Jones Act contains the further provision that "private property shall not be taken for
public use without just compensation." In addition to this there is found in the same section the
familiar provision, already expressed in section 5 of the Philippine Bill, that no law shall be enacted
which shall deprive any person of property without due process of law, or deny any person the equal
protection of the laws. (Acts of Congress of August 29, 1916, sec. 3.)

Section 64 of the Administrative Code of the Philippine Islands (Act No. 2711) expressly confers on
the Government General the power, among others:

To determine when it is necessary or advantageous to exercise the right of eminent domain

in behalf of the Government of the Philippine Islands; and to direct the Attorney-General,
where such at is deemed advisable, to cause the condemnation proceedings to be begun in
the court having proper jurisdiction.

The procedural provisions relative to the conduct of expropriation proceedings are contained in
section 241 to 253, inclusive, of the Code of Civil Procedure, supplemented as they are by various
later Acts of the Legislature. Among the salient features of the scheme of expropriation thus created
are these: (1) If the court is of the opinion that the right of expropriation exists, three commissioners
are appointed to hear the parties, view the premises, and assess the damages to be paid for the
condemnation (sec. 243 Code Civ. Proc.); (2) after hearing the evidence submitted by the parties
and assessing the damages in the manner prescribed by law (sec. 244), the commissioners make
their report to the court, setting forth all their proceedings; and it is expressly declared that "none of
their proceedings shall be effectual to bind the property or the parties until the court shall have
accepted their report and rendered judgment in accordance with its recommendations" (sec. 245);
(3) the court then acts upon the report, accepting the same in whole or in part, or rejecting,
recommitting, or setting aside the same, as it sees fit (sec. 246).
It is further declared in section 246 that —

The court . . . may make such final order and judgment as shall secure to the plaintiff the
property essential to the exercise of his rights under the law, and to the defendant just
compensation for the land so taken; and the judgment shall require payment of the sum
awarded as provided in the next section (i.e., sec. 247) before the plaintiff can enter upon the
ground and appropriate it to the public use.

Sections 247 and 251 of the same Code are of sufficient importance in this connection to warrant
quotation in their entirety. They are as follows:

SEC. 247. Rights of Plaintiff After the Judgment. — Upon payment by the plaintiff to the
defendant of compensation as fixed by the judgment, or after tender to him of the amount so
fixed and payment of the costs, the plaintiffs shall have the right to enter in and upon the land
so condemned, to appropriate the same to the public use defined in the judgment. In case
the defendant and his attorney absent themselves from the court or decline to receive the
same, payment may be made to the clerk of the court for him, and such officer shall be
responsible on his bond therefor and shall be compelled to receive it."

SEC. 251. Final Judgment, Its Record and Effect. — The record of the final judgment in such
action shall state definitely, by meters and bounds and adequate description, the particular
land or interest in land condemned to the public use, and the nature of the public use. A
certified copy of the record of the judgment shall be recorded in the office of the registrar of
deeds for the province in which the estate is situated, and its effect shall be to vest in the
plaintiff for the public use stated the land and estate so described.

The provisions which deal with the giving of immediate possession when the Government of the
Philippine Islands is the plaintiff are found in Act No. 2826, which is in part as follows:

SEC. 2. When condemnation proceedings are instituted by or in favor of the Insular

Government . . . in any competent court of the Philippines, the plaintiff shall be entitled to
enter immediately upon the land covered by such proceedings, after depositing with the
provincial treasurer the value of said land in cash, as previously and promptly determined
and fixed by the competent court, which money the provincial treasurer shall retain subject to
the order and final decision of the court: Provided, however, That the court may permit that in
lieu of cash, there may be deposited with the provincial treasurer a certificate of deposit of
any depository of the Government of the Philippine Islands, payable to the provincial
treasurer on sight, for the sum ordered deposited by the court. The certificate and the sums
represented by it shall be subject to the order and final decision of the court, and the court
shall have authority to place said plaintiff in possession of the land, upon such deposit being
made, by the proper orders and a mandate, if necessary.

SEC. 3. . . . Upon the payment by the plaintiff to the defendants of the compensation
awarded by the sentence, or after the tender of said sum to the defendants, and the payment
of the costs, or in case the court orders the price to be paid into court, the plaintiff shall be
entitled to appropriate the land so condemned to the public use specified in the sentence. In
case payment is made to the court, the clerk of the same shall be liable on his bond for the
sum so paid and shall be obliged to receive the same.

In connection with the foregoing provisions found in laws enact under the American regime is to be
considered the following provision of the Civil Code:
 ART. 349. No one may be deprived of his property unless it be by competent authority for
some purpose of proven public utility and after payment of the proper compensation.

Unless this requisite has been complied with, it shall be the duty of the court to protect the
owner of such property in its possession or to restore its possession to him, as the case may
be.

Taken together the laws mentioned supply a very complete scheme of judicial expropriation,
deducing the authority from its ultimate source in sovereignty, providing in detail for the manner of its
exercise, and making the right of the expropriator finally dependent upon payment of the amount
awarded by the court.

As has already been indicated the petition before us proceeds on the idea that the expropriation
proceedings in question cannot be maintained by the Philippine Government in the absence of a
statute authorizing the exercise of the power of eminent domain for military and aviation purposes;
and while it is not urged that a special legislative Act must be passed every time any particular parcel
of property is to be expropriated, it is
claimed — and this really amounts to the same thing — that the Government cannot institute and
prosecute expropriation proceedings unless there is already in existence a legislative appropriation
especially destined to pay for the land to be taken.

We are of the opinion that the contentions of the petitioners, in whatever way they may be
understood or expressed, are not well founded. There is one point at least on which all must agree,
namely, that if land can be taken by the Government for a public use at all, the use intended to be
made of the land now in question, that is, for military and aviation purposes, is a public use. It is
undeniable that a military establishment is essential to the maintenance of organized society, and
the courts will take judicial notice of the recent progress of the military and naval arts resulting from
the development of aeronautics.

The question as to the abstract authority of the Government to maintain expropriation proceedings
upon the initiative of the Governor-General should not be confused with that which has reference to
the necessity for a legislative appropriation. They really involve different problems and will be
separately considered.

Upon the first, we are of the opinion that in this jurisdiction at least expropriation proceedings may be
maintained upon the exclusive initiative of the Governor-General, without the aid of any special
legislative authority other than that already on the statute books. Furthermore, if the Government
complies with the requirements of law relative to the making of a deposit in court, provisional
possession of the property may be at once given to it, just as is permitted in the case of any other
person or entity authorized by law to exercise the power eminent domain. Special legislative
authority for the buying of a piece of land by the Government is no more necessary than for buying a
paper of pain; and in the case of a forced taking of property against the will of the owner, all that can
be required of the government is that should be able to comply with the conditions laid down by law
as and when those conditions arise.

The contention that the authority to maintain such a proceeding cannot be delegated by the
Legislature to the Chief Executive, is in our opinion wholly erroneous and apparently has its basis in
a misconception of fundamentals. It is recognized by all writers that the power of eminent domain is
inseparable from sovereignty being essential to the existence of the State and inherent in
government even in its most primitive forms. Philosophers and legists may differ as to the grounds
upon which the exercise of this high power is to be justified, but no one can question its existence.
No law, therefore, is ever necessary to confer this right upon sovereignty or upon any government
exercising sovereign or quasi-sovereign powers.

As is well said by the author of the article on Eminent Domain in the encyclopædic treaties Ruling
Case Law.

The power of eminent domain does not depend for its existence on a specific grant in the
constitution. It is inherent in sovereignty and exists in a sovereign state without any
recognition of it in the constitution. The provisions found in most of the state constitutions
relating to the taking of property for the public use do not by implication grant the power to
the government of the state, but limit a power which would otherwise be without limit. (10, R.
C. L., pp. 11, 12.)

In other words, the provisions now generally found in the modern laws of constitutions of civilized
countries to the effect that private property shall not be taken for public use without compensation
have their origin in the recognition of a necessity for restraining the sovereign and protecting the
individual. Moreover, as will be at once apparent, the performance of the administrative acts
necessary to the exercise of the power of eminent domain in behalf of the state is lodged by tradition
in the Sovereign or other Chief Executive. Therefore, when the Philippine Legislature declared in
section 64 of the Administrative Code, that the Governor-General, who exercises supreme executive
power in these Islands (sec. 21, Jones Act), should be the person to direct the initiation of
expropriation proceedings, it placed the authority exactly where one would expect to find it, and we
can conceive of no ground upon which the efficacy of the statute can reasonably be questioned.

We would not of course pretend that, under our modern system of Government, in which the
Legislature plays so important a role, the executive department could, without the authority of some
statute, proceed to condemn property for its own uses; because the traditional prerogatives of the
sovereign are not often recognized nowadays as a valid source of power, at least in countries
organized under republican forms of government. Nevertheless it may be observed that the real
check which the modern Legislature exerts over the Executive Department, in such a matter as this,
lies not so much in the extinction of the prerogative as in the fact the hands of the Executive can
always be paralyzed by lack of money — something which is ordinarily supplied only by the
Legislature.

At any rate the conclusion is irresistible that where the Legislature has expressly conferred the
authority to maintain expropriation proceedings upon the Chief Executive, the right of the latter to
proceed therein is clear. As is said by the author of the article from which we have already quoted,
"Once authority is given to exercise the power of eminent domain, the matter ceases to be wholly
legislative. The executive authorities may then decide whether the power will be invoked and to what
extent." (10 R. C. L., p. 14.)

The power of eminent domain, with respect to the conditions under which the property is taken, must
of course be exercised in subjection to all the restraints imposed by constitutional or organic law. The
two provisions by which the exercise of this power is chiefly limited in this jurisdiction are found in the
third section of the Jones Act, already mentioned, which among other things declares (1) that no law
shall be enacted which shall deprive any person of property without due process of law and (2) that
private property shall not be taken for public use without just compensation. The latter of these
provisions is directly aimed at the taking of property under the exercise of the power of eminent
domain; and as this requirement, in connection with the statutes enacted to make sure the payment
of compensation, usually affords all the protection that the owner of property can claim, it results that
the due process clause is rarely invoked by the owner in expropriation proceedings.
Nevertheless it should be noted that the whole problem of expropriation is resolvable in its ultimate
analysis into a constitutional question of due process of law. The specific provisions that just
compensation shall be made is merely in the nature of a superadded requirement to be taken into
account by the Legislature in prescribing the method of expropriation. Even were there no organic or
constitutional provision in force requiring compensation to be paid, the seizure of one's property
without payment, even though intended for a public use, would undoubtedly be held to be a taking
without due process of law and a denial of the equal protection of the laws.

This point is not merely an academic one, as might superficially seem. On the contrary it has a
practical bearing on the problem before us, which may be expressed by saying that, if the
Legislature has prescribed a method of expropriation which provides for the payment of just
compensation and such method is so conceived and adapted as to fulfill the constitutional requisite
of due process of law, any proceeding conducted in conformity with that method must be valid. lawphi1.net

These considerations are especially important to be borne in mind in connection with the second
contention made by counsel for the petitioners, namely, that land cannot be expropriated by the
Government in the absence of a legislative appropriation especially destined to pay for the land to be
taken. To this question we now address ourselves; and while we bear in mind the cardinal fact that
just compensation must be made, the further fact must not be overlooked that there is no organic or
constitutional provision in force in these lands Islands requiring that compensation shall actually be
paid prior to the judgment of condemnation.

If the laws which we have exhibited or cited in the preceding discussion are attentively examined it
will be apparent that the method of expropriation adopted in this jurisdiction is such as to afford
absolute assurance that no piece of land can be finally and irrevocably taken from an unwilling
owner until compensation is paid. It is true that in rare instances the proceedings may be voluntarily
abandoned before the expropriation is complete or the proceedings may fail because the
expropriator becomes insolvent, in either of which cases the owner retains the property; and if
possession has been prematurely obtained by the plaintiff in the proceedings, it must be restored. It
will be noted that the title does not actually pass to the expropriator until a certified copy of the
record of the judgment is recorded in the office of the register of deeds (sec. 251, Code Civ. Proc.).
Before this stage of the proceedings is reached the compensation is supposed to have been paid;
and the court is plainly directed to make such final order and judgment as shall secure to the
defendant just compensation for the land taken. (Sec. 246, Code Civ. Proc.). Furthermore, the right
of the expropriator is finally made dependent absolutely upon the payment of compensation by him.
(Sec. 3, Act No. 2826; sec. 247, Code Civ. Proc.).

It will be observed that the scheme of expropriation exemplified in our statutes does not primarily
contemplate the giving of a personal judgment for the amount of the award against the expropriator;
the idea is rather to protect the owner by requiring payment as a condition precedent to the
acquisition of the property by the other party. The power of the court to enter a judgment for the
money and to issue execution thereon against the plaintiff is, however, unquestioned; and the court
can without doubt proceed in either way. But whatever course be pursued the owner is completely
protected from the possibility of losing his property without compensation.

When the Government is plaintiff the judgment will naturally take the form of an order merely
requiring the payment of the award as a condition precedent to the transfer of the title, as a personal
judgment against the Government could not be realized upon execution. It is presumed that by
appearing as plaintiff in condemnation proceedings, the Government submits itself to the jurisdiction
of the court and thereby waives its immunity from suit. As a consequence it would be theoretically
subject to the same liability as any other expropriator. Nevertheless, the entering of a personal
judgment against it would be an unnecessary, as well as profitless formality.
In the face of the elaborate safeguards provided in our procedure, it is frivolous to speculate upon
the possibility that the Legislature may finally refuse to appropriate any additional amount, over and
above the provisional deposit, that may be necessary to pay the award. That it may do. But the
Government can not keep the land and dishonor the judgment. Moreover, in the eventuality that the
expropriation shall not be consummated, the owners will be protected by the deposit from any
danger of loss resulting from the temporary occupation of the land by the Government; for it is
obvious that this preliminary deposit serves the double purpose of a prepayment upon the value of
the property, if finally expropriated and as an indemnity against damage in the eventuality that the
proceedings should fail of consummation.

It appears that the money represented by the certificate of deposit which was placed at the disposal
of the lower court, pursuant to the requirements of section 2 of Act No. 2826, was taken from certain
appropriations under the control of the Militia Commission, a body created by section 29 of Act No.
2715, for the purpose, among others, of advising the Governor-General upon measures relative to
the organization equipment, and government of the National Guard and reserve militia. Counsel for
the petitioners say that money appropriated for the purpose of the Militia Commission cannot be
lawfully used to acquire the land which is now the subject of expropriation, because no authority for
the exercise of the power of eminent domain is to be found in any of the Acts appropriating money
for said Commission; from whence it is argued that the certificate of deposit affords no protection to
the owners of property.

The point appears to be one of little general importance, and we will not multiply words over it.
Suffice it to say that in our opinion the Insular Auditor was acting within his authority when he let this
money out of the Insular Treasury; and being now within the control of the lower court, it will
doubtless in due time be applied to the purpose for which the deposit was made.

From the foregoing discussion it is apparent that the action taken by the lower court in the
condemnation proceedings aforesaid was in all respects regular and within the jurisdiction of the
court. The writ prayed for in the petition before us, therefore, can not be issued. The application is
accordingly denied, with costs against the petitioners.

Arellano, C.J., Torres, Araullo and Avanceña, JJ., concur.

Johnson, J., reserves the right to prepare a separate opinion.

Separate Opinions

MALCOLM, J., concurring:

I agree with the conclusion arrived at in the majority decision. I am clearly of the opinion that the
alternative application for a writ of certiorari or prohibition should not be granted. An analysis into
their simplest elements of the various questions presented may easily be made as follows: 1. The
power of the Philippine Government in eminent domain; (2) The constitutional prohibition that (A)
private property (B) shall not be taken for public use (C) without just compensation; and 3. The
constitutional prohibition that no money shall be paid out of the treasury except in pursuance of an
appropriation by law.
1. The power of eminent domain is expressly vested in the Government of the Philippine Islands be
section 63 of the Act of Congress of July 1, 1902, commonly known as the Philippine Bill. The
Philippine Legislature has, in turn by section 64 (h) of the Administrative Code of 1917, expressly
delegated to the Governor-General the specific power and duty to determine when it is necessary or
advantageous to exercise the right of eminent domain in behalf of the Government of the Philippine
Islands. This delegation of legislative power to the Governor-General was authorized in view of the
nature of eminent domain, which necessitates administrative agents for its execution, in view of the
previous attitude assumed by the Judiciary with relation to similar delegations of power, and in view
of the undeniable fact that the Governor-General is a part of the same Government of the Philippine
Islands to which was transferred the right of eminent domain by the Congress of the United States.
(See Government of the Philippine Islands vs. Municipality of Binangonan [1916], 34 Phil. 518.)
When, therefore, the Governor-General directed the Attorney-General to cause condemnation
proceedings to be begun in the Court of First Instance of Rizal with the object of having the
Government obtain title to the site commonly known as "Camp Tomas Claudio," the Governor-
General was merely acting as a mouthpiece of American sovereignty, pursuant to a delegated power
transmitted by the Congress of the United States to the Government of the Philippine Islands and
lodged by this latter Government in the Chief Executive. Any other holding would mean that section
64 (h) of the Administrative Code is invalid, a result to be avoided.
lawphi1 .net

2. In the existing Philippine Bill of Rights (last sentence, paragraph 1, section 3, Act of Congress of
August 29, 1916) is a provision that "private property shall not be taken for public use without just
compensation." It seems undeniable (A) that Camp Claudio was "private property," and (B) that it
was being "taken for public use," namely, for military and aviation purposes. The only remaining
point concerns "just compensation," which can better be discussed under our division 3.

3. Another provision of the Philippine Bill of Rights (paragraph 15, section 3, Act of Congress of
August 29, 1916) is, "that no money shall be paid out of the treasury except in pursuance of an
appropriation by law." The same Auditor who shall "audit, in accordance with law and administrative
regulations, all expenditure of funds or property pertaining to, or held in trust, by the Government."
His administrative jurisdiction is made "exclusive." The Philippine Legislature could, of course, have
specifically appropriated an amount for the purchase of the Camp Claudio site just as it could have
specifically enacted a law for the condemnation of such site, but instead it preferred to include in the
general Appropriation Acts, under the heads of The Philippine National Guard or Philippine Militia, a
large amount to be expended in the discretion of the Militia Commission, which may "use the funds
appropriated for other purposes, as the efficiency of the service may require." This transfer of power
of the Militia Commission, like the delegation of some of the general legislative power to the
Governor-General, raises no constitutional bar. The Insular Auditor has stated that there is in the
treasury over a million pesos available for the condemnation of Camp Claudio, and this decision for
present purposes must be taken as final and conclusive. The six hundred thousand pesos deposit is
merely the provisional determination of the value of the land by the competent court, and in no way
jeopardizes the financial interests of the owners of the property. No additional security is required
since the sovereign power has waived its right to be sued, has pledged the public faith, and cannot
obtain title until the owners receive just compensation for their property. (See Sweet vs. Rechel
[1895], 159 U. S., 380.)

In resume, therefore, the Governor-General of the Philippine Islands had the right to authorize the
condemnation of this land for military and aviation purposes, and no constitutional provision has
been violated. The Court of First Instance of Rizal has merely acted in strict accord with law, and its
action should, consequently, be sustained.
G.R. No. L-2089 October 31, 1949

JUSTA G. GUIDO, petitioner,

vs.
RURAL PROGRESS ADMINISTRATION, c/o FAUSTINO AGUILAR, Manager, Rural Progress
Administration,respondent.

Guillermo B. Guevara for petitioner.

Luis M. Kasilag and Lorenzo B. Vizconde for respondent.

TUASON, J.:

This a petition for prohibition to prevent the Rural Progress Administration and Judge Oscar Castelo
of the Court of First Instance of Rizal from proceeding with the expropriation of the petitioner Justa
G. Guido's land, two adjoining lots, part commercial, with a combined area of 22,655 square meters,
situated in Maypajo, Caloocan, Rizal, just outside the north Manila boundary, on the main street
running from this city to the north. Four grounds are adduced in support of the petition, to wit:

(1) That the respondent RPA (Rural Progress Administration) acted without jurisdiction or
corporate power in filling the expropriation complaint and has no authority to negotiate with
the RFC a loan of P100,000 to be used as part payment of the value of the land.

(2) That the land sought to be expropriated is commercial and therefore excluded within the
purview of the provisions of Act 539.

(3) That majority of the tenants have entered with the petitioner valid contracts for lease, or
option to buy at an agreed price, and expropriation would impair those existing obligation of
contract.

(4) That respondent Judge erred in fixing the provisional value of the land at P118,780 only
and in ordering its delivery to the respondent RPA.

We will take up only ground No. 2. Our conclusion on this branch of the case will make superfluous a
decision on the other questions raised.

Sections 1 and 2 of Commonwealth Act No. 539, copied verbatim, are as follows:

SECTION 1. The President of the Philippines is authorized to acquire private lands or any
interest therein, through purchaser or farms for resale at reasonable prices and under such
conditions as he may fix to their bona fide tenants or occupants or to private individuals who
will work the lands themselves and who are qualified to acquire and own lands in the
Philippines.

SEC. 2. The President may designated any department, bureau, office, or instrumentality of
the National Government, or he may organize a new agency to carry out the objectives of
this Act. For this purpose, the agency so created or designated shall be considered a public
corporation.
The National Assembly approved this enactment on the authority of section 4 of Article XIII of the
Constitution which, copied verbatim, is as follows:

The Congress may authorize, upon payment of just compensation, the expropriation of lands
to be subdivided into small lots and conveyed at cost to individuals.

What lands does this provision have in view? Does it comprehend all lands regardless of their
location, nature and area? The answer is to be found in the explanatory statement of Delegate
Miguel Cuaderno, member of the Constitutional Convention who was the author or sponsor of the
above-quoted provision. In this speech, which was entitled "Large Estates and Trust in Perpetuity"
and is transcribed in full in Aruego's "The Framing of the Philippine Constitution," Mr. Cuaderno said:

There has been an impairment of public tranquility, and to be sure a continuous of it,
because of the existence of these conflicts. In our folklore the oppression and exploitation of
the tenants are vividly referred to; their sufferings at the hand of the landlords are emotionally
pictured in our drama; and even in the native movies and talkies of today, this theme of
economic slavery has been touched upon. In official documents these same conflicts are
narrated and exhaustively explained as a threat to social order and stability.

But we should go to Rizal inspiration and illumination in this problem of this conflicts between
landlords and tenants. The national hero and his family were persecuted because of these
same conflicts in Calamba, and Rizal himself met a martyr's death because of his exposal of
the cause of the tenant class, because he would not close his eyes to oppression and
persecution with his own people as victims. lawphi1 .nêt

I ask you, gentlemen of the Convention, knowing this as you do and feeling deeply as you
must feel a regret over the immolation of the hero's life, would you not write in the
Constitution the provision on large estates and trust in perpetuity, so that you would be the
very instrument of Providence to complete the labors of Rizal to insure domestic tranquility
for the masses of our people?

If we are to be true to our trust, if it is our purpose in drafting our constitution to insure
domestic tranquility and to provide for the well-being of our people, we cannot, we must fail
to prohibit the ownership of large estates, to make it the duty of the government to break up
existing large estates, and to provide for their acquisition by purchase or through
expropriation and sale to their occupants, as has been provided in the Constitutions of
Mexico and Jugoslavia.

No amendment was offered and there was no debate. According to Dean Aruego, Mr. Cuaderno's
resolution was readily and totally approved by the Convention. Mr. Cuaderno's speech therefore may
be taken as embodying the intention of the framers of the organic law, and Act No. 539 should be
construed in a manner consonant with that intention. It is to be presumed that the National Assembly
did not intend to go beyond the constitutional scope of its powers.

There are indeed powerful considerations, aside from the intrinsic meaning of section 4 of Article XIII
of the Constitution, for interpreting Act No. 539 in a restrictive sense. Carried to extremes, this Act
would be subversive of the Philippine political and social structure. It would be in derogation of
individual rights and the time-honored constitutional guarantee that no private property of law. The
protection against deprivation of property without due process for public use without just
compensation occupies the forefront positions (paragraph 1 and 2) in the Bill for private use relieves
the owner of his property without due process of law; and the prohibition that "private property
should not be taken for public use without just compensation" (Section 1 [par. 2], Article III, of the
Constitution) forbids necessary implication the appropriation of private property for private uses (29
C.J.S., 819). It has been truly said that the assertion of the right on the part of the legislature to take
the property of and citizen and transfer it to another, even for a full compensation, when the public
interest is not promoted thereby, is claiming a despotic power, and one inconsistent with very just
principle and fundamental maxim of a free government. (29 C.J.S., 820.)

Hand in hand with the announced principle, herein invoked, that "the promotion of social justice to
insure the well-being and economic security of all the people should be the concern of the state," is a
declaration, with which the former should be reconciled, that "the Philippines is a Republican state"
created to secure to the Filipino people "the blessings of independence under a regime of justice,
liberty and democracy." Democracy, as a way of life enshrined in the Constitution, embraces as its
necessary components freedom of conscience, freedom of expression, and freedom in the pursuit of
happiness. Along with these freedoms are included economic freedom and freedom of enterprise
within reasonable bounds and under proper control. In paving the way for the breaking up of existing
large estates, trust in perpetuity, feudalism, and their concomitant evils, the Constitution did not
propose to destroy or undermine the property right or to advocate equal distribution of wealth or to
authorize of what is in excess of one's personal needs and the giving of it to another. Evincing much
concern for the protection of property, the Constitution distinctly recognize the preferred position
which real estate has occupied in law for ages. Property is bound up with every aspects of social life
in a democracy as democracy is conceived in the Constitution. The Constitution owned in
reasonable quantities and used legitimately, plays in the stimulation to economic effort and the
formation and growth of a social middle class that is said to be the bulwark of democracy and the
backbone of every progressive and happy country.

The promotion of social justice ordained by the Constitution does not supply paramount basis for
untrammeled expropriation of private land by the Rural Progress Administration or any other
government instrumentality. Social justice does not champion division of property or equality of
economic status; what it and the Constitution do guaranty are equality of opportunity, equality of
political rights, equality before the law, equality between values given and received on the basis of
efforts exerted in their production. As applied to metropolitan centers, especially Manila, in relation to
housing problems, it is a command to devise, among other social measures, ways and means for
the elimination of slums, shambles, shacks, and house that are dilapidated, overcrowded, without
ventilation. light and sanitation facilities, and for the construction in their place of decent dwellings for
the poor and the destitute. As will presently be shown, condemnation of blighted urban areas bears
direct relation to public safety health, and/or morals, and is legal.

In reality, section 4 of Article XIII of the Constitution is in harmony with the Bill of Rights. Without that
provision the right of eminent domain, inherent in the government, may be exercised to acquire large
tracts of land as a means reasonably calculated to solve serious economic and social problem. As
Mr. Aruego says "the primary reason" for Mr. Cuaderno's recommendation was "to remove all doubts
as to the power of the government to expropriation the then existing landed estates to be distributed
at costs to the tenant-dwellers thereof in the event that in the future it would seem such expropriation
necessary to the solution of agrarian problems therein."

In a broad sense, expropriation of large estates, trusts in perpetuity, and land that embraces a whole
town, or a large section of a town or city, bears direct relation to the public welfare. The size of the
land expropriated, the large number of people benefited, and the extent of social and economic
reform secured by the condemnation, clothes the expropriation with public interest and public use.
The expropriation in such cases tends to abolish economic slavery, feudalistic practices, and other
evils inimical to community prosperity and contentment and public peace and order. Although courts
are not in agreement as to the tests to be applied in determining whether the use is public or not,
some go far in the direction of a liberal construction as to hold that public advantage, and to
authorize the exercise of the power of eminent domain to promote such public benefit, etc.,
especially where the interest involved are considerable magnitude. (29 C.J.S., 823, 824. See
also People of Puerto Rico vs. Eastern Sugar Associates, 156 Fed. [2nd], 316.) In some instances,
slumsites have been acquired by condemnation. The highest court of New York States has ruled that
slum clearance and reaction of houses for low-income families were public purposes for which New
York City Housing authorities could exercise the power of condemnation. And this decision was
followed by similar ones in other states. The underlying reasons for these decisions are that the
destruction of congested areas and insanitary dwellings diminishes the potentialities of epidemic,
crime and waste, prevents the spread of crime and diseases to unaffected areas, enhances the
physical and moral value of the surrounding communities, and promotes the safety and welfare of
the public in general. (Murray vs. La Guardia, 52 N.E. [2nd], 884; General Development
Coop. vs. City of Detroit, 33 N.W. [2ND], 919; Weizner vs. Stichman, 64 N.Y.S. [2nd], 50.) But it will
be noted that in all these case and others of similar nature extensive areas were involved and
numerous people and the general public benefited by the action taken.

The condemnation of a small property in behalf of 10, 20 or 50 persons and their families does not
inure to the benefit of the public to a degree sufficient to give the use public character. The
expropriation proceedings at bar have been instituted for the economic relief of a few families devoid
of any consideration of public health, public peace and order, or other public advantage. What is
proposed to be done is to take plaintiff's property, which for all we know she acquired by sweat and
sacrifice for her and her family's security, and sell it at cost to a few lessees who refuse to pay the
stipulated rent or leave the premises.

No fixed line of demarcation between what taking is for public use and what is not can be made;
each case has to be judge according to its peculiar circumstances. It suffices to say for the purpose
of this decision that the case under consideration is far wanting in those elements which make for
public convenience or public use. It is patterned upon an ideology far removed from that consecrated
in our system of government and embraced by the majority of the citizens of this country. If upheld,
this case would open the gates to more oppressive expropriations. If this expropriation be
constitutional, we see no reason why a 10-, 15-, or 25-hectare farm land might not be expropriated
and subdivided, and sold to those who want to own a portion of it. To make the analogy closer, we
find no reason why the Rural Progress Administration could not take by condemnation an urban lot
containing an area of 1,000 or 2,000 square meters for subdivision into tiny lots for resale to its
occupants or those who want to build thereon.

The petition is granted without special findings as to costs.

Moran, C.J., Feria, Bengzon, Padilla and Montemayor, JJ., concur.

Paras and Reyes, JJ., concur in the result.

Separate Opinions

TORRES, J., concurring:

I fully concur in the above opinion of Mr. Justice Tuason. I strongly agree with him that when the
framers of our Constitution wrote in our fundamental law the provision contained in section 4 of
Article XIII, they never intended to make it applicable to all cases, wherein a group of more or less
numerous persons represented by the Rural Progress Administration, or some other governmental
instrumentality, should take steps for the expropriation of private land to be resold to them on the
installment plan. If such were the intention of the Constitution, if section 4 of its Article XIII will be so
interpreted as to authorize that government corporation to institute the corresponding court
proceedings to expropriate for the benefit of a new interested persons a piece of private land, the
consequence that such interpretation will entail will be incalculable.

In addition to the very cogent reasons mentioned by Mr. Justice Tuason in support of his
interpretation of that constitution created by the acquisition of the so-called friar lands at the
beginning of the establishment of civil government by the United States in these islands. After the
lapse of a few years, the tenants for whose benefit those haciendas were purchased by the
government, and who signed contracts of purchase by the government. Thousands of cases were
time, the Government which had been administering those haciendas for a long period of years went
into much expense in order to achieve the purpose of the law. I take for granted that in this case the
prospective purchasers, in inducing the government to buy the land to be expropriated and sold to
them by lots on the installments plan do from the beginning have the best of intentions to abide by
the terms of the contract which they will be required to sign.

If I am not misinformed, the whole transaction in the matter of the purchase of the friar lands has
been a losing proposition, with the government still holding many lots originally intended for sale to
their occupants, who for some reasons or other failed to comply with the terms of the contract signed
by them.

Without the sound interpretation thus given this Court restricting within reasonable bounds the
application of the provision of section 4 of Article XIII of our Constitution and clarifying the powers of
the Rural Progress Administration under Commonwealth Act No. 539, said corporation — or, for that
matter, some other governmental entity — might embark in a policy of indiscriminate acquisition of
privately — owned land, urban or otherwise just for the purpose of taking care of the wishes of
certain individuals and, as outlined by Mr. Justice Tuason, regardless of the merits of the case. And
once said policy is carried out, it will place the Government of the Republic in the awkward
predicament of veering towards socialism, a step not foreseen nor intended by our Constitution.
Private initiative will thus be substituted by government action and intervention in cases where the
action of the individual will be more than enough to accomplish the purpose sought. In the case at
bar, it is understood that contracts, for the sale by lots of the land sought to be expropriated to the
present tenants of this herein petitioner, have been executed. There is, therefore, not the slightest
reason for the intervention of the government in the premises.

G.R. No. L-10278 November 23, 1915

THE MANILA RAILROAD COMPANY, plaintiff-appellant,

vs.
ROMANA VELASQUEZ, MELECIO ALLAREY and DEOGRACIAS MALIGALIG, defendants-
appellants.

William A. Kincaid and Thomas L. Hartigan for plaintiff.

Ledesma, Lim and Irureta Goyena for defendants.

TRENT, J.:

This action was instituted by the Manila Railroad Company for the purpose of expropriating twelve
small parcels of land for a railroad station site at Lucena, Province of Tayabas.
The original defendants were Romana Velasquez, Melecio Allarey, and Deogracias Maligalig. After
the filing of the complaint Simeon Perez, Filemon Perez, and Francisco Icasiano, having bought
Romana Velasquez' interest, were included as defendants. The commissioners fixed the value of the
twelve parcels at P81,412.75, and awarded P600 to Simeon Perez as damages for the removal of
an uncompleted camarin. Upon hearing, the commissioners' report was approved and the plaintiff
directed to pay to the "Tayabas Land company" the total amount awarded, with interest and costs.
The plaintiff company alleges that that amount is grossly excessive, pointing out that the land has
never been used except for rice culture.

Upon this appeal we are asked to review the evidence and reduce the appraised value of the
condemned land in accordance with our findings rendering judgment accordingly. Has this court,
under the law, authority to take such action? And along with this question it must be decided whether
the Courts of First Instance have such power over the reports of commissioners. Section 246 of the
Code of Civil Procedure reads:

Action of Court Upon Commissioners' Report. — Upon the filing of such report in court, the
court shall, upon hearing, accept the same and render judgment in accordance therewith; or
for cause shown, it may recommit the report to the commissioners for further report of facts;
or it may set aside the report and appoint new commissioners; or it may accept the report in
part and reject it in part, and may make such final order and judgment as shall secure to the
plaintiff the property essential to the exercise of this rights under the law, and to the
defendant just compensation for the land so taken; and the judgment shall require payment
of the sum awarded as provided in the next section, before the plaintiff can enter upon the
ground and appropriate it to the public use.

From this section it clearly appears that the report of the commissioners on the value of the
condemned land is not final. The judgment of the court is necessary to give effect to their estimated
valuation. (Crawford vs. Valley R.R. Co., 25 Grat., 467.) Nor is the report of the commissioners
conclusive, under any circumstances, so that the judgment of the court is a mere detail or formality
requisite to the proceedings. The judgment of the court on the question of the value of the land
sought to be condemned is rendered after a consideration of the evidence submitted to the
commissioners, their report, and the exceptions thereto submitted upon the hearing of the report. By
this judgment the court may accept the commissioners' report unreservedly; it may return the report
for additional facts; or it may set the report aside and appoint new commissioners; or it may accept
the report in part or reject it in part, and "make such final order and judgment as shall secure to the
plaintiff the property essential to the exercise of this rights under the law, and to the defendant just
compensation for the land so taken." Any one of these methods of disposing of the report is available
to and may be adopted by the court according as they are deemed suited to secure to the plaintiff
the necessary property and to the defendant just compensation therefor. But can the latter method
produce a different result in reference to any part of the report from that recommended by the
commissioner?

Section 246 expressly authorizes the court to "accept the report in part and reject it in part." If this
phrase stood alone, it might be said that the court is only empowered to accept as a whole certain
parts of the report and reject as a whole other parts. That is, if the commissioners fixed the value of
the land taken at P5,000, the improvements at P1,000, and the consequential damages at P500, the
court could accept the report in full as to any one item and reject it as to any other item, but could not
accept or reject a part of the report in such a way as to change any one of the amounts. But the
court is also empowered "to make such final order and judgment as shall secure to the plaintiff the
property essential to the exercise of this rights under the law, and to the defendant just
compensation for the land so taken." The court is thereby expressly authorized to issue such orders
and render such judgment as will produce these results. If individual items which make up the total
amount of the award in the commissioners' report could only be accepted or rejected in their entirety,
it would be necessary to return the case, so far as the rejected portions of the report were
concerned, for further consideration before the same or new commissioners, and the court could not
make a "final order and judgment" in the cause until the rejected portions of the report had been
reported to it. Thus, in order to give the quotation from 246 its proper meaning, it is obvious that the
court may, in its discretion correct the commissioners' report in any manner deemed suitable to the
occasion so that final judgment may be rendered and thus end the litigation. The "final order and
judgment" are reviewable by this court by means of a bill of exceptions in the same way as any other
"action." Section 496 provides that the Supreme Court may, in the exercise of its appellate
jurisdiction, affirm, reverse, or modify any final judgment, order, or decree of the Court of First
Instance, and section 497, as amended by Act No. 1596, provides that if the excepting party filed a
motion in the Court of First Instance for a new trial upon the ground that the evidence was
insufficient to justify the decision and the judge overruled such motion and due exception was taken
to his ruling, the Supreme Court may review the evidence and make such findings upon the facts by
a preponderance of the evidence and render such final judgment as justice and equity may require.
So it is clear from these provisions that this court, in those cases where the right to eminent domain
has been complied with, may examine the testimony and decide the case by a preponderance of the
evidence; or, in other words, retry the case upon the merits and render such order or judgment as
justice and equity may require. The result is that, in our opinion, there is ample authority in the
statute to authorize the courts to change or modify the report of the commissioners by increasing or
decreasing the amount of the award, if the facts of the case will justify such change or modification.
As it has been suggested that this conclusion is in conflict with some of the former holdings of this
court upon the same question, it might be well to briefly review the decisions to ascertain whether or
not, as a matter of fact, such conflict exists.

In City of Manila vs. Tuason (R.G. No. 3367, decided March 23, 1907, unreported), the Court of First
Instance modified the report of the commissioners as to some of the items and confirmed it as to
others. On appeal, the Supreme Court remanded the cause, apparently for the reason that the
evidence taken by the commissioners and the lower court was not before it, and perhaps also
because the commissioners adopted a wrong principle of assessing damages.

In Manila Railway Co. vs. Fabie (17 Phil. Rep., 206) the majority report of the commissioners
appraised the land at P56,337.18, while a dissenting commissioners estimated it at P27,415.92. The
Court of First Instance, after taking additional evidence upon the consequential benefits to the
remainder of defendants' land by the construction of the railroad, and also as to the rental value of
various pieces of land in the locality, fixed the value of the land at the sum estimated by the
dissenting commissioner. The defendants appealed to this court. This court remarked that the only
evidence tending to support the majority report of the commissioners consisted of deeds of transfer
of real estate between parties in that community showing the prices paid by the vendees in such
conveyances. It was held that without its being shown that such transfers had been made in the
ordinary course of business and competition, and that the parties therein stated were not fictitious,
such deeds were incompetent as evidence of the value of the condemned land. As to the action of
the court in fixing the price of the land at P27,415.92, the court said:

Conceding, without deciding, that he also had the right to formulate an opinion of his own as
to the value of the land in question, nevertheless, if he formulate such an opinion, he must
base it upon competent evidence. The difficulty with the case is that it affirmatively appears
from the record on appeal that there is an entire absence of competent evidence to support
the finding either of the commissioners or of the court, even if the court had a right to make a
finding of his own at all under the circumstances.
In the Manila Railroad Co. vs. Attorney-General (22 Phil. Rep., 192) the only question raised was the
value of certain improvements on the condemned portion of a hacienda, such improvements
consisting mainly of plants and trees and belonging to a lessee of the premises. The total damages
claimed were P24,126.50. The majority report of the Commission allowed P19,478, which amount
was reduced by the Court of First Instance to P16,778. The plaintiff company, upon appeal to this
court, alleged that the damages allowed were grossly excessive and that the amount allowed by the
commissioners should have been reduced by at least P17,000; while the defendant urged that the
damages as shown by the record were much greater than those allowed, either by the
commissioners or by the court. In disposing of the case this court said:

The only ground upon which the plaintiff company bases its contention that the valuations
are excessive is the minority report of one of the commissioners. The values assigned to
some of the improvements may be excessive but we are not prepared to say that such is the
case. Certainly there is no evidence in the record which would justify us in holding this values
to be grossly excessive. The commissioners in their report go into rather minute detail as to
the reasons for the conclusions reached and the valuations fixed for the various items
included therein. There was sufficient evidence before the commissioners to support the
valuations fixed by them except only those later modified by the court below. The trial court
was of opinion that the price of P2 each which was fixed for the orange trees (naranjitos) was
excessive, and this was reduced to P1.50 for each tree; this on the ground that the evidence
discloses that these trees were comparatively young at the time of the expropriation, and that
the value fixed by the majority report of the commissioners was that of full-grown or nearly
full-grown trees. We are of opinion that this reduction was just and reasonable. Aside from
the evidence taken into consideration by the trial judge we find no evidence in the record in
support of the contention of the railroad plaintiff that the valuations fixed in the majority report
of the commissioners and by the trial court are grossly excessive, and plaintiff company
having wholly failed to offer evidence in support of its allegations in this regard when the
opportunity so to do was provided in accordance with law, it has no standing in this court to
demand a new trial based on its unsupported allegations of grossly excessive valuation of
the property by the commissioners and the court below.

This court affirmed the finding of damages made by the trial court with the exception of an item for
damages caused by fire to improvements on lands adjoining those condemned, which was held not
to be a proper matter to be considered in condemnation proceedings. The court here approved of
the action of the Court of First Instance in reducing the amount of damages fixed by the
commissioners as to the value of the young orange trees on the strength of the evidence of record.

In Manila Railroad Company vs. Caligsahan (R.G. No. 7932, decided March 25, 1913, unreported), it
appears that the lower court approved in toto the report of the commissioners. On appeal, This
Supreme Court reversed the lower court and remanded the case with orders to appoint new
commissioners, saying:

Under the evidence in this case the award is excessive. Section 246 of the Code of Civil
Procedure giving to the court the power to "make such final order and judgment as shall
secure to the party the property essential to the exercise of his rights under the law, and to
the defendant just compensation for the land so taken," we exercise that right in this case for
the purpose of preventing the defendants from obtaining that which would be more than `just
compensation' under all the evidence of the case.

The judgment is reversed and the cause remanded, with instructions to the lower court to
appoint a new commission and to proceed from that point de novo.
We will now examine the case (Philippine Railway Co. vs. Solon, 13 Phil. Rep., 34) relied upon the
support the proposition that the courts should not interfere with the report of the commissioners to
correct the amount of damages except in cases of gross error, showing prejudice or corruption.

In that case the property belonging to the appellant which the company sought to appropriate was
his interest as tenant in a tract of land belonging to the Government, together with a house standing
thereon and other property belonging to him. He asked that he be awarded for all the property taken
P19,398.42. The commissioners allowed him P10,745.25. At the hearing had upon the report, the
court reduced this amount and allowed the appellant P9,637.75. The commissioners took a large
amount of evidence relative to the amount of damages. The testimony was conflicting as to the value
of the house, two witnesses fixing it at over P12,000; and another at P14,000; one at P8,750;
another at P6,250; and another at P7,050.95. The commissioners fixed the value of the house alone
at P9,500, and the court at P8,792.50. This court said:

Nor do we decide whether, in a case where the damages awarded by the commissioners are
grossly excessive or grossly insufficient, the court can, upon the same evidence presented
before the commissioners, itself change the award. We restrict ourselves to deciding the
precise question presented by this case, in which it is apparent that, in the opinion of the
court below, the damages were not grossly excessive, for its own allowance was only P1,000
less than the amount allowed by the commissioners, and the question is whether in such a
case the court can substitute its own opinion upon the evidence presented before the
commissioners for the opinion which the commissioners themselves formed, not only from
that evidence but also from a view of the premises which by law they were required to make.

Referring to the manner in which the trial court arrived at its valuation of the various items, including
the house, this court said:

Without considering the correctness of the rule adopted by the court for determining the
value of the property it is sufficient to say that the evidence before the commissioners as to
the value of the property taken was contradictory and that their award was not palpably
excessive or inadequate. Under such circumstances, we are of the opinion that the court had
no right to interfere with it.

From the foregoing it is clear that (1) the testimony was conflicting; (2) that the award as allowed by
the commissioners was well within the amounts fixed by the witnesses; and (3) that the award was
not grossly excessive. That it was not grossly excessive is shown by the difference between the
amount fixed by the commissioners and that fixed by the court, this difference being P1,117.50, a
reduction of a little over 10 per cent.

In City of Manila vs. Estrada (25 Phil. Rep., 208), the city sought to expropriate an entire parcel of
land with its improvements for use in connection with a public market. The commissioners, after
viewing the premises and receiving evidence, being unable to agree, submitted two reports to the
court. In the majority report the value of the land was fixed at P20 per square meter and in the
minority report at P10. The Court of First Instance fixed the value at P15 per square meter. Upon
appeal this court, after reviewing the evidence, held that P10 per square meter was a just
compensation for the land taken and rendered judgment accordingly, saying:

After a careful examination of the entire record in this case and the law applicable to the
questions raised therein, we are of the opinion that P10 per square meter is a just
compensation for the land taken.
From the above review of the cases it will be seen that this court has not only not decided that the
courts cannot interfere with the report of the commissioners unless prejudice or fraud has been
shown, but the decisions, aside from the case of the City of Manila vs. Estrada, tend to show the
contrary; that is, an award which is grossly excessive or grossly insufficient in the opinion of the court
can be increased or decreased, although there be nothing which tends to indicate prejudice or fraud
on the part of the commissioners. The case of the City of Manila vs. Estrada is direct authority
supporting the conclusions which we have reached in the case at bar. And we are not without
authority outside of this jurisdiction which supports the view we have taken in the case under
consideration. In Morgan's Louisiana & Texas R.R. Co. vs. Barton (51 La. Ann., 1338), the court, in
considering a procedural law similar to our own, stated:

On the question of the value of the land, 8.34 acres, the commissioners have allowed
$2,500, or $300 per acre. The defendant has put in the record the testimony of witnesses
claimed to support the allowance. Without disregarding this testimony, it is sufficient to say
that the opinions of the witnesses do not seem to be based on any fact calculated to show
the value of the land. ... On the other hand the plaintiff has placed before us the titles of
defendant of recent date showing the price paid by him (the defendant) for the entire body of
land of which the 8 acres are part; the acts of sale of land in the same neighborhood, and of
the same quality; the assessment of defendant's property, and other testimony on this issue
of value. ... Giving all possible weight, or rather restricting the testimony of the plaintiffs'
witnesses to its due influence, and giving, we think, necessary effect to the acts by which
defendant purchased, the acts of sale of other land, the assessment of value, with due
allowance for under assessment, and the other testimony of record, we reach the conclusion
that the award gives two-thirds more than the value of the land. We fix the value of the land
at $833.33.

See also T. & P.R.R. Co. vs. Southern Develop. Co. (52 La. Ann., 535), where the court held the
appraisement too low and after discussing the evidence, increased the amount of the award
accordingly. A similar case is Abney vs.Railroad Co. (105 La., 446). See also T. & P.R.R.
Co. vs. Wilson (108 La., 1; 32 So., 173); and Louisiana Western R. Co. vs. Crossman's Heirs (111
La., 611; 35 So., 784), where the point is touched upon.

In Missouri the statute (1 Mo. Ann. Stat., sec. 1268) directs that "the court shall make such order
therein as right and justice may require, and may order a new appraisement, upon good cause
shown." Owing to a constitutional restriction, this provision has been construed to apply only to
damages and benefits resulting to land owners in consequence of proposed improvements, the cash
value of property expropriated being an issue triable, at the instance of either party by a jury
subsequent to the findings of the commissioners. Subject to this restriction, however, it has been
held that the above provision of law gives the court the right increase or decrease the amount
awarded by the commissioners. In the late case of Tarkio Drainage District vs. Richardson (237 Mo.,
49), the court presents a lengthy review of its decisions on this subject.

The question now arises, when may the courts, with propriety, overrule the award of the
commissioners in whole or in part, and substitute their own valuation of the condemned property?
We shall consider this question in two ways: first, as one of procedure under section 246, above
quoted; and second, as to the evidence which must appear in the record in order to justify such
action.

From a mere reading of section 246 and the remarks just made, it should be clear that the court is
permitted to act upon the commissioners' report in one of several ways, at its own discretion. The
whole duty of the court in considering the commissioners' report is to satisfy itself that just
compensation will be made to the defendant by its final judgment in the matter, and in order to fulfill
its duty in this respect the court will be obliged to exercise its discretion in dealing with the report as
the particular circumstances of the case may require. But generally speaking, when the
commissioners' report cannot with justice be approved by the court, one of three or four
circumstances will usually present itself, each of which has for its antidote one of the methods of
dealing with the report placed at the disposal of the court by section 246. Thus, if it be successfully
established that the commissioners refused to hear competent evidence material to the case, then
all the evidence in the case would not be before the court. The court could not, with reason, attempt
to either approve or change the report, as it stood, for the reason that all the evidence of the case
would not have been considered by the commissioners not have been presented to the court; and
the remedy would be to "recommit the report of the commissioners for further report of facts." Again,
if improper conduct, fraud, or prejudice be charged against the commissioners and this charge be
sustained it would be safer to set aside the award thus vitiated and "appoint new commissioners"
who could render a report not tainted by these things. But when the only error of the commissioners
is that they have applied illegal principles to the evidence submitted to them; or that they have
disregarded a clear preponderance of the evidence; or that they have used an improper rule of
assessment in arriving at the amount of the award, then, in such a case, if the evidence be clear and
convincing, the court should ordinarily be able, by the use of those correct legal principles which
govern the case, to determine upon the amount which should be awarded without returning the
report to the commissioners. When the matter stands in this light, it becomes the duty of the court to
make "final order and judgment" in which the proper award will be made and thus end the litigation
between the parties.

Now, what evidence as to value must the record contain in order to justify the court in disregarding
the valuation fixed upon the condemned property by the commissioners and substituting therefor its
own finding of value? It is almost a universal practice in the United States to submit the question of
value in expropriation cases to a jury or commission, usually of local property owners, and one of the
things they are specially instructed to do is to view or inspect the condemned property. The purpose
of this view and the additional weight which would should be given to the award of the appraisers
because of the view are questions often discussed. After a careful examination of a number of
adjudicated cases, we have concluded that the following cases, all agreeing in principle, correctly
state the purpose of the view.

In Denver Co. vs. Howe (49 Colo., 256 112 P., 779), it was said: "The jury viewed the premises and
were better able to judge of the number of acres in each, as well as other conditions affecting the
land. The facts ascertained by the view of the premises are not in the record, whether they were
regarded as so much additional evidence, or were used to better understand and apply the evidence
adduced at the trial. Keeping in view the evidence relating to the special value of the building site,
the value of improvements and of the ground, it will be found that the verdict is within and supported
by the values as testified to, and these values, as fixed by the several witnesses, represented to
each the market value, as conceded by appellants. The verdict is supported by the evidence of
market value and on that ground would have to be sustained if the matter complained of in the
instruction had been entirely omitted."

In Gorgas vs. Railroad Co. (114 Pa., 1; 22 Atl., 715), it was said: "A view may sometimes be of the
highest importance, where there is a conflict of testimony. It may enable the jurors to see on which
side the truth lies. And if the witnesses on the one side or the other have testified to a state of facts
which exists only in their imagination, as to the location of the property, the manner in which it is cut
by the road, the character of the improvements, or any other physical fact bearing upon the case,
they surely cannot be expected to ignore the evidence of their sense and give weight to testimony
which their view shows to be false. ... The true in such cases is believed to be that the jury in
estimating the damages shall consider the testimony as given by the witnesses, in connection with
the facts as they appear upon the view; and upon the whole case, as thus presented, ascertain the
difference between the market value of the property immediately before and immediately after the
land was taken. This difference is the proper measure of damages."

In Close vs. Samm (27 Iowa, 503), subsequently approved in Guinn vs. Railway Co. (131 Iowa, 680,
683; 109 N.W., 209), it was said: "The question then arises as to the purposes and intent of this
statute. It seems to us that it was to enable the jury, by the view of the premises or place to better
understand and comprehend the testimony of the witnesses respecting the same, and thereby the
more intelligently to apply the testimony to the issues on trial before them, and not to make them
silent witnesses in the case, burdened with testimony unknown top both parties, and in respect to
which no opportunity for cross-examination or correction of error, if any, could be afforded either
party. If they are thus permitted to include their personal examination, how could a court ever
properly set aside their verdict as being against the evidence, or even refuse to set it aside without
knowing the facts ascertained by such personal examination for the jury? It is a general rule
certainly, if not universal, that the jury must base their verdict upon the evidence delivered to them in
open court, and they may not take into consideration facts known to them personally, but outside of
the evidence produced before them in court. If a party would avail himself of the facts known to a
juror, he must have him sworn and examined as other witnesses."

In C.K. & W.R. Co. vs. Mouriquand (45 Kan., 170), the court approved of the practice of instructing
the jury that their view of the premises was to be used in determining the value of conflicting
testimony, saying: "Had the jury disregarded all the sworn evidence, and returned a verdict upon
their own view of the premises, then it might be said that the evidence which the jurors acquired from
making the view had been elevated to the character of exclusive and predominating evidence. This
is not allowable. The evidence of the witnesses introduced in the court on the part of the landowner
supports by substantial testimony given by witnesses sworn upon the trial, we would set it aside, but
as the jury only took into consideration the result of their view of the premises, in connection with the
sworn evidence produced before them, to determine between conflicting evidence, the instruction
was not so erroneous as to require a new trial."

In Postal Telegraph-Cable Co. vs. Peyton (124 Ga., 746; 52 S.E., 803; 3 L.R.A., N.S., 333), it was
said: "A jury cannot be left to roam without any evidence in the ascertainment and assessment of
damages. The damages which the law allows to be assessed in favor of a landowner whose
property has been taken or damaged under the right of eminent domain are purely compensatory.
The land actually appropriated by the telegraph company amounted to only a fraction of an acre; and
while it appeared that the construction and maintenance of the telegraph line would cause
consequential damages to the plaintiff, no proof was offered from which any fair and reasonable
estimate of the amount of damages thereby sustained could be made. The jury should have been
supplied with the data necessary in arriving at such an estimate. In the absence of this essential
proof, a verdict many times in excess of the highest proved value of the land actually taken must
necessarily be deemed excessive. Judgment reversed."

In New York, where the question has doubtless been raised more often than anywhere else, the late
cases illustrate the rule, perhaps the most clearly. The appellate division, supreme court, in In
re Titus Street in city of New York (123 N.Y.S., 1018), where it appeared that the city's witnesses
testified that the property was worth $9,531 and the commissioners awarded $2,000 less, said:

We do not think that this is meeting the requirements of the law; we do not believe that it is
within the province of commissioners to arbitrarily set up their own opinion against that of the
witnesses called by the city, and to award damages largely below the figure to which the
moving party is committed, without something appearing in the record to justify such action.
When a party comes into court and makes an admission against his interest, no court or
judicial tribunal is justified in assuming that the admission is not true without at least pointing
 out the reason for discrediting it; it carries with it the overcome by the mere fact that the
commissioners might themselves have reached a different conclusion upon the viewing of
the premises. ... This view of the commissioners, it seems to us, is for the purpose of
enabling the commissioners to give proper weight and effect to the evidence before them,
and it might justify them in giving larger damages than some of the witnesses thought proper,
or even less than some of them declared to be sustained, but where the evidence produced
by the moving party in a proceeding for taking property for public purposes fixes a sum,
without any disagreement in the testimony on that side, we are of the opinion that the case
do not justify a holding that the commissioners are authorized to ignore such testimony and
to substitute their own opinion, in such a manner as to preclude the supreme court from
reviewing the determination. That is not in harmony with that due process of law which is
always demanded where rights of property are involved, and would make it possible for a
corrupt commission to entirely disregard the rights of the individual to the undisturbed
enjoyment of his property, or its equivalent.

From these authorities and keeping in mind the local law on the subject, we think the correct rule to
be that, if the testimony of value and damages is conflicting, the commissioners may resort to their
knowledge of the elements which affect the assessment and which were obtained from a view of the
premises, in order to determine the relative weight of conflicting testimony, but their award must be
supported by the evidence adduced at their hearings and made of record, or it cannot stand; or, in
other words, the view is intended solely for the purpose of better understanding the evidence
submitted. To allow the commissioners to make up their judgment on their own individual knowledge
of disputed facts material to the case, or upon their private opinions, would be most dangerous and
unjust. It would deprive the losing party of the right of cross-examination and the benefit of all the
tests of credibility which the law affords. It would make each commissioner the absolute judge of the
accuracy and value of his own knowledge or opinions and compel the court to affirm the report on
the facts when all of such facts were not before it. The evidence of such knowledge or of the
grounds of such opinions could not be preserved in a bill of exceptions or questioned upon appeal. It
is no hardship upon any of the parties to require that the award must be based upon the evidence. It
is the duty of each party to submit what evidence of value he has and if he fails to do so he can not
complain if the appraisement in kept within the bounds of the evidence presented to the
commissioners.

In those cases where the testimony as to value and damages in conflicting the commissioners
should always set forth in full their reasons for accepting the testimony of certain witnesses and
rejecting that the others, especially in those cases where a view of the premises has been made.

The commissioners are required by law to be disinterested landowners of the province, selected by
the court with a view to their ability to arrive at a judicious decision in the assessment of damages.
The judgment of men with these qualifications upon the price of real property is entitled to some
considerable weight. Being local men, it may be assumed that they are familiar with the local land
values, the needs of the community in that line, and the adaptability of particular sites to commercial
purposes. Then, too, their view of the premises enables commissioners to better understand the
evidence submitted to them, as we have said above. The declarations of witnesses as to the value of
the land, as to its condition, or the conditions of improvements which may be located upon it, and
comparisons made between the condemned land and other land in the vicinity may all be better
understood by the commissioners if they have viewed the premises. It is, therefore, no slight
divergence from the seeming preponderance of the evidence of record, as viewed by the court,
which will justify the court in brushing aside the commissioners' report and appraising the property
itself, based only upon a perusal of the evidence which was submitted to them. It is in those cases
where the evidence submitted to the commissioners as to the value varies greatly that the real
difficulty lies. In these cases it is clear that some of the evidence must be untrustworthy. Hence, it is
necessary to reject that evidence which shows the price to be greatly higher or lower than the just
compensation to which the defendant owner is entitled. If, after making due allowance for the
superior facilities which the commissioners had for arriving at the correct value of the property, the
court is clearly of the opinion that the evidence relied upon by them is untrustworthy, and that other
evidence rejected by the commission and which fixes the value of the property at a figure greatly at
variance with their valuation of the property bears the earmarks of truth, then it becomes the duty of
the court to substitute for the commissions' award the amount indicated by such evidence. That the
estimated value made by the appraisers is to be given "great weight;" that such valuation is not to be
"lightly set aside;" that it will not be set aside "if there is substantial testimony to support it," unless
error is "plainly manifest;" "unless it is apparent that injustice has been done;" "unless the
commissioners have clearly gone astray or adopted erroneous principles;" "unless the
commissioners acted upon wrong principles, or their award is grossly inadequate;" unless the award
is "palpably excessive or inadequate;" unless it is "grossly inadequate or unequal," is the burden of
all the cases.

Let us now examine the evidence, keeping these legal principles in mind. The only discussion of the
evidence of value made by the lower court was as follows:

To determine this question (the value of the land) the court abides by and refers to the report
of the commissioners dated July 10, 1913, because it understands that it must accept this
report in all its parts for the reason that the prices fixed in the said report of P3.75 per square
meter for parcel 21-B, that of P3.50 per square meter for parcel 21-A, and that of P2 per
square meter for the rest of the parcels (naming them) are reasonable and just; the
compensation which is made in the said report for the damages occasioned to the defendant
Simeon Perez being also reasonable and just.

It will be seen that the lower court relied entirely upon the findings of the commissioners. The
commissioners justified their appraisement of the land at a price so greatly in excess of its value as
agricultural land upon the following considerations. First, the construction of the provincial building
and the high school had increased the price of land in their vicinity. Second, the neighborhood of
these building had become a choice residential district. Third, the population in the vicinity had
increased since it became known that the condemned property had been selected as a station site
by the railroad company. We propose to discuss the evidence of value precisely along these lines,
starting first, however, with its value as agricultural land, the only use to which it has ever been put.

The condemned land is not located in the commercial district of the town of Lucena, but is located
near the provincial building and the high school. The land has been used from time out of mind
solely for the cultivation of rice. Deogracias Maligalig, one of the defendants, testified that rice land in
the municipality of Lucena was worth P500 per cavan (hectare). Melecio Allarey, another defendant,
testified that such land was worth from P300 to P400 per hectare. Agustin testified that such land
was worth between P400 and P500 per hectare if not under irrigation, and if under irrigation, more
than P1,000. Ambrosio Zaballero, owner of more than 30 parcels of land in the municipality of
Lucena, said that the site of the railroad station was nothing but a rice field prior to the coming of the
railroad, worth from P300 to P400 per hectare. Cayo Alzona, the only witness for the plaintiff,
testified that, in Candelaria, rice land was worth between P200 and P250 per hectare, he having
purchased an uncleared parcel of the rice land for P150 per hectare. It seems fair to accept the
statement of the two defendants, Maligalig and Allarey, and fix the price of the condemned land for
agricultural purposes at P500 per hectare.

Witnesses for the defendants, including three of the latter, fixed the value of the condemned land at
prices ranging from P5 to P8 per square meter. The remaining defendant, Icasiano, did not testify
before the commissioners. But in his answer filed about seven months after purchasing the land for
P0.81 per square meter, he alleged that his parcel was worth P5 per square meter. So that we have
all of the defendants and several other witnesses estimating the value of the condemned land at
about the same figure, or from P50,000 to P80,000 per hectare.

The defendant, Melecio Allarey, testified that he owned 30,000 square meters of land in the vicinity
of the railroad station site, 2,895 square meters of which was wanted by the plaintiff company. Upon
being asked what the value of his land was, he promptly replied that it was worth P5.50 per square
meters. Asked if he were making his will whether he would list this property at a total value of
P150,000, he evaded a direct reply by saying that he would divide it among his children. Asked if he
considered himself the owner of land valued at P150,000, he replied that for his purpose he figured
on that price. Asked if he would declare the land to be worth that sum in his sworn tax declaration,
he replied that he would accept the figures fixed upon by the tax appraisers. His testimony shows
clearly that he did not desire to commit himself positively to the assertion that his three hectares of
land was worth P150,000. His ambiguous and evasive replies on cross-examination do not at all
harmonize with his unequivocal statement in his direct examination that his land was worth
P5.50 per square meter. Apparently, when confronted with the price per hectare, which this estimate
would put upon his land, he was somewhat astounded. Indeed, we are inclined to believe that one of
the reasons for the high value placed upon the condemned land by all the witnesses is that they
were estimating the price per square meter instead of per hectare, which is the customary method of
fixing the price of agricultural land. A perusal of the remainder of the testimony of defendant Allarey
shows that he is paying annual taxes on his 30,000 square meters of land amounting to between
P12 and P13. He also naively informs us that he has not been able to till the land lately because he
has no carabaos or other work animals.

Several of the witnesses for the defendants testified to having purchased land in the vicinity of the
station site for residential purposes. Thus, Edard testified that he paid P1,400 for 220 square meters
in 1910. Andres Dinlasan sold 119 square meters for P10 per square meter on June 6, 1912. He
could give no reason why the purchaser had paid so much for the land, but in response to a question
said the purchaser had some more land joining it. Agustin bought 1,900 square meters in 1910 for
P2 per square meter. Esteban Lagos paid P1,000 for a plot 16 by 18 meters in 1911. A most
remarkable thing about these purchases is that, as choice residential sites, they are so extremely
small. With the possible exception of the parcel purchased by Agustin, the parcels in question are
hardly generous enough to permit of the construction of even a modest mansion. Cayo Alzona
testified that he purchased 2,200 square meters in 1906 for P350, and that he purchased a little less
than one hectare in 1912, all in the vicinity of the station site, for which he paid P1,500. It will be
noted that there is considerable difference between these figures and the prices at which the other
witnesses testified they purchased land in that neighborhood. That the evidence of sales of nearby
land was competent, there can be no doubt.

In Aledo Terminal Ry. Co. vs. Butler (246 Ill., 406; 92 N.E., 909), the court said: "Evidence of
voluntary sales of other lands in the vicinity and similarly situated is admissible in evidence to aid in
estimating the value of the tract sought to be condemned, but the value of such testimony depends
upon the similarity of the land to that in question and the time when such sales were made and the
distance such lands are from those the value of which is the subject of inquiry."

In an earlier case, the supreme court of Illinois stated the rule as follows: "The theory upon which
evidence of sales of other similar property in the neighborhood, at about the same time, is held to be
admissible is that it tends to show the fair market value of the property sought to be condemned. And
it can not be doubted that such sales, when made in a free and open market, where a fair
opportunity for competition has existed, become material and often very important factors in
determining the value of the particular property in question." (Peoria Gas Light Co. vs.Peoria Term.
Ry. Co., 146 Ill., 372; 21 L.R.A., 373; 34 N.E. 550.)
The supreme court of Massachusetts, in Fourth National Bank vs. Com. (212 Mass., 66; 98 N.E.,
86), affirms the rule as follows: "It long has been settled that in the assessment of damages where
lands are acquired by eminent domain evidence is admissible of the price received from sales of
land similar in character, and situated in the vicinity, if the transactions are not so remote in point of
time that a fair comparison practically is impossible."

In Hewitt vs. Price (204 Mo., 31), it was said: "It is sufficient to say upon this proposition that the law
is well settled in this State upon the subject, and while the value or selling price of similar property
may be taken into consideration in determining the value of the piece of property in litigation, it is
equally true that the location and character of such property should be similar and the sale of such
other property should at least be reasonably near in point of time to the time at which the inquiry of
the value of the property in dispute is directed."

In Laing vs. United New Jersey R.R. & C. Co. (54 N.J.L., 576; 33 Am. St. Rep., 682; 25 A., 409), it
was said: "Generally in this and other states evidence of sales of land in the neighborhood is
competent on an inquiry as to the value of land, and if the purchases or sales were made by the
party against whom the evidence was offered it might stand as an admission. But such testimony is
received only upon the idea that there is substantial similarity between the properties. The practice
does not extend, and the rule should not be applied, to cases where the conditions are so dissimilar
as not easily to admit of reasonable comparison, and much must be left to the discretion of the trial
judge in the determination of the preliminary question whether the conditions are fairly comparable."

Evidence of other sales made in good faith is competent if the character of such parcels as sites for
business purposes, dwellings, or for whatever other use which enhances the pecuniary value of the
condemned land is sufficiently similar to the latter that it may be reasonably assumed that the price
of the condemned land would be approximately near the price brought by the parcels sold. The
value of such evidence, of course, diminishes as the differences between the property sold and the
condemned land increase. The property must be in the immediate neighborhood, that is, in the zone
of commercial activity with which the condemned property is identified, and the sales must be
sufficiently near in point of time with the date of the condemnation proceedings as to exclude general
increases or decreases in property values due to changed commercial conditions in the vicinity. No
two estates are ever exactly alike, and as the differences between parcels sold and the land
condemned must necessarily be taken into consideration in comparing values, we think it much
better that those differences should be shown as part of the evidence of such sales, as is the
practice in Iowa. (Town of Cherokee vs. S.C. & I.F. Town Lot and Land Co., 52 Iowa, 279; 3 N.W.,
42.) And where these differences are so great that the sales in question can form no reliable
standard for comparison, such evidence should not be admitted. (Presbrey vs. Old Colony &
Newport R. Co., 103 Mass., 1.)

Aside from the bare fact that the real estate transactions referred to by the witnesses were
somewhere in the vicinity of the condemned land, there is nothing to guide us as to the relative value
of the condemned land. The differences which must have existed between the various parcels of
land in the vicinity we are left to imagine. And while the commissioners' view of the condemned land
undoubtedly assisted them in forming their estimate of value, still counsel should not have relied
upon their astuteness to discover differences in values, but should have brought them specifically to
the attention of the commissioners. It seems rather unusual, also, that the bare statements of
witnesses should be accepted as to the prices which nearby parcels brought, in view of the
insistence of counsel that the condemned land is nothing more than agricultural land. These sales
should have been thoroughly investigated to determine whether they were made bona fide and, if so,
whether they were not attended by unusual circumstances which materially increased the purchase
price.
But while these transfers of nearby land are interesting as bearing upon the value of the condemned
land, the record also shows several transfers of the latter itself after it became generally known that
it had been selected by the railroad company as the site for its Lucena station. We take it that these
transactions, in which the defendants were themselves parties, offer a far more certain basis for
estimating the value of the land than do their testimony before the commissioners or the testimony of
other witnesses as to fancy prices paid for neighboring parcels. Romana Velasquez, who owned the
major portion of the condemned land, disposed of hers to her nephews surnamed Perez. Her first
sale was on July 21, 1912. This parcel contained 16,094 square meters and brought at this time
P6,500, or a little more than P0.40 per square meter. A month later Perez sold this parcel to one
Icasiano for P13,000, or a little less than P0.81 per square meter. Sra. Velasquez' next sale was of
three parcels, the first two of which contained approximately 23,000 square meters, while the area of
the third was described as three gantas of rice. The total price of the three parcels was P2,500 of a
little over P0.10 per meter. In one of these parcels was located approximately 8,700 square meters
of the condemned land which the commissioners reported at a price higher than any of the rest.

On May 26, 1913, Icasiano, the then owner of the parcel containing 16,094 square meters, sold it to
the Tayabas Land Company for P18,000; and on July 1, 1913, some twenty days after the
commissioners had rendered their report, all of the remaining owners of the condemned land sold
their holdings, parcel by parcel, as it had been assessed by the commissioners, to the same
company for P1.05 per square meter, with the exception of Simeon Perez who sold the two parcels
owned by him at P2.27 and P2.11, respectively. Here is the most convincing argument that all the
witnesses who placed values on the condemned property, ranging from P5 per square meter to P8
per meter, were seriously in error. After all the speculation concerning the land, after the
commissioners had reported its value at prices ranging from P2 to P3.75 per square meter, the
owners sold the land, parcel by parcel, as it had been assessed by the commissioners for a little
more than P1 per meter, with exception of Simeon Perez who accepted P2.11 and P2.27 for the two
parcels which the commissioners had appraised at P3.50 and P3.75 per meter, respectively. It is
unfortunate that the commissioners did not have an opportunity to consider the deeds executed by
the defendants in favor of the Tayabas Land Company. With the commissioners' valuation of the land
before them, the Tayabas Land Company was actually able to purchase from the defendant all of the
condemned land at a greatly inferior price. The defendants were not able to resist an offer of P1 and
P2 per meter for their holdings, notwithstanding their fervid declarations before the commissioners
that their property was worth P5 per meter, and notwithstanding the official report by a board
composed of local men that it was worth from P2 to P3.75 per meter. This, of course, does not
include the defendant Icasiano who sold out to the land company after the commission had been
appointed but before it had begun its labors. It is to be remembered, however, that he both bought
and sold the land after the railroad company had made known its intention of expropriating it, and
that in his answer to the complaint he alleged his land to be worth P5 per meter.

Now, what was the object of the Tayabas Land Company in purchasing the land? Evidently it was not
with the intention of making any use of it, for the railroad company had long since taken possession.
They, as well as the owners, were simply speculating on the probability that the award of the
commissioners would be approved by the court. It was little more than a sporty guess on each side
as to what would be allowed for the land by the final judgment of the court. The company believed
the award would exceed P1.05 per meter, and the defendants thought the risk that the award would
be in a lesser amount was so great that they let the land go for the price the company offered them.
Nor is it at all certain that the prices inserted in these deeds of sale were not fictitiously inflated. The
circumstances under which the sales were made would readily suggest the expediency of inserting
fictitious prices in the deeds.

The moment a parcel of land is wanted by a public service corporation the price, for some occult
reason, immediately soars far beyond what the owner would think of asking or receiving in the open
market. Owners ask fabulous prices for it and neighbors look on with an indulgent smile or even
persuade themselves that the land is worth the price for which the owner holds out — in view of the
fact that it is wanted by a corporation, whose financial resources are popularly supposed to be
inexhaustible. The resultant good to a community due to the investment of new capital, the
increased employment of labor, and the services the corporation will render are for the moment
forgotten; and persons called upon for opinions as to the price of the desired property, unconsciously
perhaps, relax from that sound business acumen which guides them in their daily affairs, while they
are considering, not the price which they would care to pay if they wanted the land, but the price
which the corporation ought to pay in view of the fact that it is a corporation.

The owner of condemned land is entitled to just compensation. That is all the law allows him.
"Compensation" means an equivalent for the value of the land (property) taken. Anything beyond
that is more and anything short of that is less than compensation. To compensate is to render
something which is equal in value to that taken or received. The word "just" is used to intensify the
meaning of the word "compensation;" to convey the idea that the equivalent to be rendered for the
property taken shall be real, substantial, full, ample. "Just compensation." therefore, as used in
section 246 of the Code of Civil Procedure, means a fair and full equivalent for the loss sustained.

The exercise of the power being necessary for the public good, and all property being held
subject to its exercise when, and as the public good requires it, it would be unjust to the
public that it should be required to pay the owner more than a fair indemnity for such loss. To
arrive at this fair indemnity, the interests of the public and of the owner and all the
circumstances of the particular appropriation should be taken into consideration. (Lewis on
Eminent Domain, sec. 462.)

The compensation must be just to the public as well as to the owners. (Searl vs. School District 133
U.S., 533; 33 L. ed. 740.) Section 244 of our code says that:

The commissioners shall assess the value of the property taken and used and shall also
assess the consequential damages to the property not taken an deduct from such
consequential damages the consequential benefits to be derived by the owners from the
public use of the land taken.

"To assess" is to perform a judicial act. The commissioners' power is limited to assessing the value
and to determining the amount of the damages. There it stops; they can go no further. The value and
damages awarded must be a just compensation and no more and no less. But in fixing these
amounts, the commissioners are not to act ad libitum. They are to discharge the trust reposed in
them according to well established rules and form their judgment upon correct legal principles. To
deny this is to place them where no one else in this country is placed, above the law and beyond
accountability.

There is no question but that the compensation to which a defendant owner is entitled is the market
value of the condemned property, to which, of course, must be added his consequential damages if
any, or from which must be deducted his consequential benefits, if any. Such was our holding in
Manila Railway Co. vs. Fabie (17 Phil. Rep., 206). But as stated in Packard vs. Bergen Neck Ry. Co.
(54 N.J.L., 553; 23 A., 506):

The difficulty is not with the rule, but with its application. For the determination of the market
value of land, which is 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 the given and
received therefor, is beyond doubt difficult. The test is logically and legally correct, but is
cannot be applied to land with the accuracy with which it can be applied to stocks, bonds and
 personal property generally. Still it is this test which admittedly must be applied, even when
the value of the land and the damages are found in separate sums.

It is a very difficult matter to limit the scope of the inquiry as to what the market value of condemned
property is. The market value of a piece of land is attained by a consideration of all those facts which
make it commercially valuable. Whether evidence considered by those whose duty it is to appraise
the land is of that nature is often a very difficult matter to decide. The Supreme Court of the United
States, in a carefully worded statement, marks out the scope of the inquiry as follows:

In determining the value of the appropriated for public purposes, the same considerations
are to be regarded as in a sale of property between private parties. The inquiry in such cases
must be: What is that property worth in the market, viewed not merely with reference to the
uses to which it is at the time applied, but with reference to the uses to which it is plainly
adapted; that is to say, what is it worth from its availability for valueless uses? ... As a general
thing, we should say that the compensation to the owner is to be estimated by reference to
the uses for which the property is suitable, having regard to the existing business or wants of
the community, or such as may be reasonably expected in the immediate future. (Boom
Co. vs. Patterson, 98 U.S., 403.)

This passage is quoted with approval in the late case of St. Loui I.M. & S.R. Co. vs. Theodore
Maxfield Co. (94 Ark., 135; 26 L.R.A., N.S., 1111; 126 S.W., 83), a very well considered case.

The supreme court of Missouri has also formulated an exceedingly clear statement of the matter in
the Stock Yards Case (120 Mo., 541):

The market value of the property means its actual value, independent of the location of
plaintiff's road thereon, that is, the fair value of the property as between one who wants to
purchase and one who wants to sell it; not what could be obtained for it in peculiar
circumstances when greater than its fair price could be obtained; nor its speculative value;
nor the value obtained through the necessities of another. Nor, on the other hand, is it to be
limited to that price which the property would bring when forced off at auction under the
hammer. The question is, if the defendant wanted to sell its property, what could be obtained
for it upon the market from parties who wanted to buy and would give its full value. lawph!1.net

These views are practically in accord with Lewis on Eminent Domain (2d ed.), section 478, where
the rule is stated as follows:

The market value of property is the price which it will bring when it is offered for sale by one
who desire, but is not obliged to sell it, and is bought by one who is under no necessity of
having it. In estimating its value all the capabilities of the property, and all the uses to which it
may be applied or for which it is adapted are to be considered, and not merely the condition
it is in at the time and the use to which it is then applied by the owner. It is not a question of
the value of the property to the owner. Nor can the damages be enhanced by his
unwillingness to sell. On the other hand, the damages cannot be measured by the value of
the property to the party condemning it, nor by its need of the particular and its surroundings,
its improvements and capabilities, may be shown and considered in estimating its value.
(Approved in Seaboard Air Line vs. Chamblin, 18 Va., 42.)

Now, what was the utility of the land condemned? So far as the record shows, its possible uses
were, first, for the cultivation of rice; second, as a residential site owing to its proximity to the
provincial building and the high school; and third, as a railroad station site.
Its location from a farmer's point of view would doubtless enhance its value, since it was so close to
the town of Lucena that the marketing of crops was a decidedly simple matter. For this reason it was
more valuable as agriculture land than other farms farther away from town.

As a residential site it seems to have been so far a complete failure. How long the high school had
stood there the record does not state. But although the provincial building had stood near it for
several years, not a single homebuilder had selected any portion of the condemned land as a site for
his residence. We note that all those who testified at the hearing before the commissioners to having
purchased land in the vicinity for home sites, purchased other land than that condemned. Nor does
the record contain any intimation that any of the owners of the land had ever attempted to dispose of
any part of it as building lots. As a residential site, therefore, its value was decidedly problematical.
Possibly, in the next dozen years a few houses might have been built upon the land, but, judging by
the past record, its development along this line would have been extremely slow.

As a railroad station site, the record gives no indication that it is the sole possible location for that
purpose in Lucena. It is not shown that its location for that purpose is at all superior to other side of
town. Hence, possessing no exclusive natural advantages for this purpose, it is a foregone
conclusion that the railroad company would not willingly pay P81,00 for such a site when it could
have purchased another site for, say, P1,500.

Here it seems proper to say that the appearance of the railroad in the town of Lucena was the
occasion for an incipient real estate boom in the vicinity of the provincial building and the high
school. Several of the witnesses for the defendants testified what they would offer; if they were in the
market for land in the vicinity of the station site, and the witness Alzona, the single witness who
testified for the plaintiff, testified that some owner of land near the provincial building were
asking between P50 and P700 for lost of 400 square meters. It is clear that these hypothetical
purchases and sales do not offer any reliable basis upon which to calculate the actual market value
of the land. The fond dreams of the owners of a sudden shift of the business center on the town of
Lucena to their vicinity, or of its becoming a choice residential district, are not capital in hand.

Proof must be limited to showing the present condition of the property and the uses to which
it is naturally adapted. It is not competent for the owner to show to what use he intended to
put the property, nor what plans he had for its improvement, nor the probable future use of
the property. Nothing can be allowed for damages to an intended use. (Lewis on Eminent
Domain, 2d ed., sec. 709.)

From the evidence we have discussed above, it is apparent that a good price for rice land in the
vicinity of Lucena is P500 per hectare. With his as a basis, at what would the prospective buyer
estimate the possibility of the land being used as a residential site sometime in the future and its
possible advantages as a railroad site? Certainly at nothing like the estimates contained in the report
of the commissioners. To secure an adequate return on such a large investment as P80,000, every
meter of the land would have to be put to immediate use as residential sites, supposing that people
could be induced to buy it for that purpose at such figures or to pay the necessarily large rent
therefor based on such a valuation. And to hold out for such a figure in case a railroad company
wanted the land as a depot site would mean that the company would locate its depot at some other
place. It seems to us that, either as a residential site or as a railroad station site, its value should be
principally regulated by the value of other agricultural land on the outskirts of the town. In other
words, the chance that it would be wanted for either of these purposes owing to its superior location
was but slightly greater than that of other agricultural land adjacent to the town. We are, therefore,
led to the conclusion that the price at which practically half of the condemned land was, sold by
Romana Velasquez to the defendant, Filemon Perez, is a most liberal estimate of its value. We refer
to her sale of the parcel of 16,094 square meters for P6,500. This parcel comprises practically one-
half of the entire station site and no outside land was included in the transaction. The sale was made
after it became known that the land sold was to be part of the station site, and a statement to this
effect was included in the deed. Both parties being aware that the land was to be condemned by the
plaintiff company, it cannot be said that they were not aware of all the latent utility of the land. For
these reasons, the price which this parcel brought should serve as an excellent criterion of the value
of the entire station site. And while no explanation is given of why the sale occurred, since, of
course, no one would but it with the expectation of using it himself when he knew that it would
shortly be occupied by the railroad company, still there is not sufficient indication that it was sold for
speculative purposes or that the element of speculation entered into the transaction to enable us to
say that the price was inflated and exceeded the actual market value of the condemned land as
agricultural land to be worth P500 per hectare, and leaves a little more than P3,500 for
its potential value as a residential district and as a railroad station site. This is, furthermore,
approximately 400 per cent higher than Sra. Velasquez' second sale (some for months later) to
Simeon Perez, when she sold about 23,000 square meters in the same neighborhood for a little over
P1,000 per hectare.

It is to be further noted that the average assessed valuation of the condemned property is somewhat
less than P0.08 per square meter, while the highest assessed valuation of any of it is only P0.23 per
square meter, which is carried by some 5,973 square meters, or less than one-sixth of the whole. It
is also to be noted that these 5,973 square meters were appraised by the commissioners as being
worth exactly what the 16,094 square meters were worth, the latter being assessed for taxation
purposes at only P0.03 per square meter.

At the price we have fixed, we are of the opinion that any consequential damages which may have
been occasioned to any of the defendants by the condemnation proceedings is amply cared for.

The defendants, Simeon Perez, was awarded P600 damages by the commissioners for being
compelled to remove a building in course of construction at the time the expropriation proceedings
were started. This building was designed to serve partly as a warehouse and partly for stores. He
commenced its construction about the middle of December, 1912, after it became known that he
plaintiff company wanted the land for a railroad station. Construction work was ordered stopped by
the court. From the vague description of this order in the record, we presume it was the order of the
court of date of January 22, 1913, placing the plaintiff in possession of the land under the provisions
of Act No. 1258 as amended by Act No. 1592. Until such action was taken by the railroad company,
or until the commissioners were appointed and had appraised the land, we know of no legal
provision which would prohibit the owner from doing with the land what he pleased. The Act in
question gives t the company "the right t enter immediately upon the possession of the land
involved." (Sec. 3.) This amendment to Act No. 1258 was enacted especially for the benefit of
railroad companies, and affords full protection to them if they act with due diligence. Until some such
positive assertion of its desire to expropriate the land, no reason is seen why the company might not
ask for a dismissal of the proceedings in accordance with section 127 of the Code of Civil
Procedure. The right of the owner to the enjoyment of his property ought not to be made to depend
so entirely upon the whims of a third party. No attempt was made to meet the statement of Perez
that he had expended a large sum of money on the construction of the building. The commissioners
probably saw the structure or some of the materials which entered into it and are in a much better
position to judge of the amount expended upon the work than are we. They have fixed that amount
at P600. In the absence of positive evidence in the record showing this findings to be grossly
excessive, we must accept it as correct.

For the foregoing, reasons, the judgment of the court below is modified by reducing the award for the
parcel containing 16,094 square meters to the sum of P6,500. The damages for the remaining
parcels will be fixed at the same proportionate amount. As thus modified the judgment appealed
from is affirmed. No costs will be allowed on this appeal. The amount as herein fixed, together with
interest, will be deposited with the clerk of the Court of First Instance of Tayabas, subject to the rights
of the defendants and the Tayabas Land Company. So ordered.

Arellano, C.J., Torres, Carson, and Araullo, JJ., concur.

Municipality Of Daet Vs Court Of Appeals, 93 Scra 503

(1979)
CASE DIGEST

Facts:

The judgment of the respondent Court of Appeals, subject of the instant petition to review on
certiorari, "fixing the fair market value of the property sought to be expropriated at P200.00 per
square meter or of Five Hundred Forty three thousand Four hundred (P543,400.00) pesos, and the value
of the improvement thereon at Thirty six thousand five hundred (P36,500.00) PESOS, Philippine
Currency, both amounts to bear legal interest from and after the date of the actual taking of
possession by the Municipality of Daet, Camarines Norte until the full amount is paid, with costs against
plaintiff-appellant," must be affirmed in the light of the unusual, unique and abnormal circumstances
obtaining in this case where the complaint for condemnation was filed on August 9, 1962 or seventeen
(17) years ago but up to the present, the petitioner Municipality of Daet has failed to make the deposit
required to take possession of the property sought to be expropriated.

Issue: Whether or not the valuation is just, fair and reasonable.

Ruling:

For purposes of just compensation in cases of private property acquired by the government for public
use, the basis shall be the current and fair market value as declared by the owner or administrator or
such market value as determined by the assessor, whichever is lower. It is a cardinal rule of statutory
construction that laws shall have only prospective effect. The provisional value of the property in this
case having already been fixed, the deposit on February 9, 1973 of the amount of P54,370.00
representing the assessed value of the land and the deposit on October 21, 1977 of the amount of
P25,830.00 representing the assessed value of the improvement, both pursuant to the said decree, are
not sufficient. Nevertheless, said amounts should be deducted from the total amount due to private
respondent. To explain and clarify the judgment of the Court in affirming the decision appealed, the
demolition of the building of private respondent standing on the land by the Municipal Mayor, Engr.
Jose P. Timoner on February 14, 1978 constituted the actual taking of possession of the property
sought to be expropriated by the Municipality of Daet. And from said date, February 14, 1978, interest
at the legal rate shall be paid by the municipality until the full amount is paid.

G.R. No. L-35861 October 18, 1979

MUNICIPALITY OF DAET, petitioner,

vs.
COURT OF APPEALS and LI SENG GIAP & CO., INC., respondent.
GUERRERO, J.:

The judgment of the respondent Court of Appeals, subject of the instant petition to review on
certiorari, "fixing the fair market value of the property sought to be expropriated at P200.00 per
square meter or for of FIVE HUNDRED FORTY THREE THOUSAND FOUR HUNDRED
(P543,400.00) PESOS, and the value of the improvement thereon at THIRTY SIC THOUSAND FIVE
HUNDRED (P36,500.00) PESOS, Philippine Currency, both amounts to bear legal interest from and
after the date of the actual taking of possession by the Municipality of Daet, Camarines Norte until
the full amount is paid, with costs against plaintiff-appellant," must be affirmed in the light of the
unusual, unique and abnormal circumstances obtaining in this case where the complaint for
condemnation was filed on August 9, 1962 or seventeen (17) years ago but up to the present, the
petitioner Municipality of Daet has failed to make the deposit required to take possession of the
property sought to be expropriated.

The Municipality of Daet instituted condemnation proceedings against private respondent Li Seng
Giap & Co. Inc. on August 9, 1962 before the Court of Firs Instance of Camarines Norte for the
purpose of acquiring and subsequently converting the following described property owned by private
respondent as a public park:

A parcel of land (Lot No. 3 Plans PSU-57331 situated in the Poblacion, Municipality
of Daet, bounded on the North-East by a provincial road known as Vinzons Avenue;
on the South-East, by Felipe II Street; on the South, by Ildefonso Moreno Street, and
on the West, by J. Lukban Street, covering an area of TWO THOUSAND SEVEN
HUNDRED AND SEVENTEEN (2,717 sq. meters) SQUARE METERS, more or less
and assessed by TRANSFER CERTIFICATE OF TITLE NO. 207 in the name of Li
Seng Giap & Co. 1

On August 20, 1962, private respondent, having been served with summons through counsel, filed a
"Motion to Dismiss" on the following grounds:

1. The proposed expropriation has not been duly authorized as provided by law,
principally because it has not been approved by the Office of the President as
required by Section 2245 of the Revised Administrative Code;

2. There is no genuine necessity for the proposed expropriation of the defendant's

property;

3. The proposed park should be put up in a different site which would entail less
expense to the plaintiff;

4. The present expropriation proceeding instituted by the herein plaintiff against the
defendant is discriminatory;

5. The plaintiff does not have sufficient funds to push through its project of
constructing a park and to allow the plaintiff to expropriate defendant's property this
time would be only to needlessly deprive the latter of the use of its property.2

On February 8, 1963, the trial court rendered a decision dismissing the expropriation proceedings
mainly on the grounds that there is no "genuine need" for the petitioner to convert the aforestated lot
into a park nor necessity to widen the streets and that even if there is genuine necessity for the
proposed expropriation, still the petitioner cannot, in this case, exercise the power of eminent
domain as it has no funds to pay the reasonable value of the land and the building thereon. 3

On February 12, 1963, petitioner filed a motion for reconsideration which was denied on February
27, 1963. Petitioner then appealed to the Court of Appeals, which appeal was docketed as CA-G.R.
No. 32-259-R. On April 14, 1968, the Court of Appeals rendered a decision reversing the trial court's
decision, the dispositive portion of which is as follows:

WHEREFORE, the appealed "decision" (order) in Civil Case No. 1436 for
expropriation is hereby reversed and set aside, and, in lieu thereof, another one is
hereby rendered denying defendant Li Seng Gia & Company's motion for dismiss;
declaring that plaintiff Municipality of Daet has a lawful right to take the property
sought to be condemned, for the public use described in the complaint, upon
payment of just compensation to be determined as of the date of the filing of the
complaint; directing the court a quo to promptly fix the provisional value of the
property sought to be condemned for the purposed of the motion of plaintiff
Municipality of Daet to take immediate possession of said property under Sec. 2 of
Rules 67 (formerly Sec. 3 of Rules 69) of the Rules of Court; and remanding the case
to the court a quo for further proceedings consistent with this decision, the costs in
this appeal to be taxed against plaintiff Municipality of Daet in accordance with Sec.
12 of Rule 67 (formerly Sec. 13 of Rule 69) of the Rules of Court; ...4

On March 20, 1969, after the records of the case were remanded to the trial court, private
respondent filed a "Motion for Appointment of Commissioners to Fix Just Compensation for the
Property Sought to be Taken."

On April 15, 1969, the trial court issued twin orders: (1) fixing the provisional value of the land at
P129,99 per square meter and the value of the improvement at P30,000.00 totalling P356,040.00
and require the Municipality to deposit with the Provincial Treasurer in cash or in security which
should be payable on demand and upon deposit being effected, the Clerk of Court was ordered to
issue the necessary writ of place the Municipality in possession of the property; and (2) appointing
Atty. Ernesto de Jesus, Provincial Assessor, as chairman; Atty. Jose V. Jamito, PNB Branch Attorney
and Dr. Mateo Aquino, a resident of the municipality, as members of the committee on appraisal. The
committee members proceeded to qualify by taking their oaths of office and then held three sessions
on May 10, May 17, and May 24, 1969. On May 28, 1969, the committee filed t he following report:

COMMISSIONERS' REPORT

In compliance with the order of this Honorable Court dated April 15, 1969, and
pursuant to the provisions of Sec. 6. Rule 67 of the Rules of Court, the undersigned
commissioners, with due notice to the counsels of both parties, convened in the
morning of May 10, 1969, for the purpose of finding ways and means by which the
commissioners could ascertain the fair market value of the property subject of this
proceeding. There are two basic approaches used in the appraisal of land sought to
be condemned — the sale approach, and the income approach. The commissioners
as well as the counsels of both parties agreed to use the sale approach. In order to
enable the counsels of both parties, as well as the commissioners, to gather or
secure documents regarding transaction of real property which the commissioners
might use as guide in determining the fair market value, the parties agreed to
postpone the hearing to May 17, 1969, at 6:30 in the morning.
Hearing was resumed in the morning of May 17, forthwith, the counsel for the plaintiff
presented documents which were submitted as Exhibits, to wit:

1. Exh. "A" — Deed of absolute sale executed by Lydia Moreno in favor of Jaime R.
Alegre, entered as Doc. No. 160: Page No. 33: Book No. IV; Series of 1962. (The
consideration was about P13.00 per square meter).

2. Exh. "B" — Deed of absolute sale executed by Jesus Villafranca y Aules in favor of
Sourthern Products Import and Export Corporation, entered as Doc. No. 314; Page
No. 64; Book No. II; Series of 1962. (The consideration was around P14.00 per
square meter).

3 Exh. "C" — Deed of absolute sale executed by Julio Curva, et al. in favor of
Felicidad Vinzons Pajarillo, entered as Doc. No. 186; Page No. 39; Book No. 1;
Series of 1958. (The consideration was P 15.00 per square meter).

4. Exh. "D" — Deed of Absolute Sale executed by Clao Dy Kim To in favor of

Concepcion Fonacier-Abaño, entered as Doc. No. 133; Page No. 88; Book No. V;
Series of 1948. (The consideration was about P8.57 per square meter).

5. Exh. "E" — Deed of sale with mortgage executed by Dr. Agustin F. Cuevas and
Leticia Lopez, in favor of the Camarines Norte Teachers Cooperative Credit Union,
Inc., entered as Doc. No. 117; Page No. 56; Book NO. VIII; Series of 1961. (The
consideration was P57,000.00 — the lot with an area of 972 square meters, and a
three-storey concrete building assessed at P16,000.00 under Tax Dec. No. 7083. If
we will exclude the value of the building, the consideration for the land will be about
P43.00 per square meter).

After the submission of the aforementioned exhibits, upon motion of the counsel for
the defendant, the hearing was postponed to May 24, 1969, at 8:30 in the morning.
Upon resumption of the hearing on said hour and date, the counsel for the defendant
presented Exh. 1, which the deed of sale executed by the Municipality of Daet in
favor of the Development Bank of the Philippines; the document was executed on
January 30, 1969; Exh. "1-A", the consideration in the amount of P205,600.00; Exh.
"1-B", the area of 2,056 square meters; and Exh. "2", the letter of Tomas Cootauco to
Li Seng Giap & Co., dated July 21, 1962. In addition to the aforementioned evidence,
the counsel for the defendant presented as witness Lo Chin who testified that
sometime in July, 1962. In addition to the aforementioned evidence, the counsel for
the defendant presented as witness Lo Chin who testified that sometime in July, 19
1962 (after the fire), he was instructed by his son-in-law, Mr. Jesus Ty Poco, to see
Mr. Jose Ong, the representative of Mr. William Lee, for the purpose of making an
offer to buy the land subject of this proceeding for a price of P120.00 per square
meter, and P30,000.00 for the structure thereon; that he had talked with Mr. William
Lee, for the purpose of making an offer to buy the land subject of this proceeding for
a price of P120.00 per square meter, and P30,000.00 for the structure thereon; that
he had talked with Mr. Jose Ong, for the same purpose, on several occasions 5 or 6
times, the last was sometime in the first week of May, this year wherein he offered to
pay as high as P150.00 per square meter, and P50,000,00 for the structure thereon;
and that Mr. Ty Poco, having been born in Mercedes, and resided here since birth,
was desirous of buying said property because he intends to build a memorial
thereon. Counsel likewise presented Mr. Jose Ong as witness to corroborate the
testimony of Lo Chin.
 After the hearing held by the commissioners, Atty. Ernesto de Jesus, who is the
incumbent provincial assessor, dig up the records in his office for the purpose of
finding, in addition to the exhibits already presented, other documents covering
transactions of properties located within the areas near the land sought to be
condemned, but failed to locate even a single document Hence, the commissioners
have no other recourse but to base their appraisal of the value of the land under
consideration from the Exhibits submitted by the parties.

Under Sec. 4, Rule 67, of the Rules of Court, just compensation is to be determined
as of the date of the filing of the complaint. The above-entitled complaint was filed in
August, 1962; hence, Exh. "1", Exh. "1-B" and Exh. "1-C" could not be taken into
consideration, the same having been executed in the year 1969 — seven years after
the filing of the complaint. The offer of Mr. Jesus Ty Poco could not also be
considered because the same was made by one who was under an imperative
necessity of buying the property.

After all the exhibits submitted by the plaintiff had been examined by the
commissioners, and upon a conscientious and analytical study of the sales of land
near the land subject of this proceeding, and after serious deliberations on the
matter, the commissioners agreed that, in the year 1962, the reasonable or fair
market value of the land subject of this proceeding should be P60.00 per square
meter; and the structure remaining thereon at P15,000.00

Attached hereto is the map of the commercial center of Daet wherein the land
subject of this case is shown. The lands described in the Exhibits submitted by the
plaintiff are also indicated thereon.

Daet, Camarines Norte, May 28, 1969.

Respec
tfully
submitt
ed,

(Sgd.) Ernesto de Jesus (Sgd.) Jose V. Jamito

Commissioner Commissioner

(Sgd.) Mateo D. Aquino

Commissioner 5

Private respondent, having received copy of the commissioner's report, filed a "Motion to Admit
Additional Evidence" which was opposed by petitioner but the same was granted by the Court
provided that the additional evidence consisted of the expert testimony of a duly licensed broker. On
August 20, 1969, the municipality manifested its conformity to the commissioner's report.

Meanwhile, on July 23, 1969, Judge Gabriel V. Valero, the Presiding Judge at Branch I, issued an
order transferring this case to Judge Isidro Vera of Branch II, who proceeded to take the additional
evidence of private respondent. Said evidence consisted of the testimony of Engineer Aurelio B.
Aquino, who appraised the land involved herein at P200.00 per square meter and the improvement
thereon at P36,500.00 in 1969.

On December 2, 1969, after submission of evidence for both parties, the trial court rendered a
decision disregarding the valuation made by the commissioners and using the appraisal of Engineer
Aurelio B. Aquino in 1969 as the basis in determining the value of the land in 1962. The dispositive
portion of said decision is quoted herein as follows:

WHEREFORE, the Court renders judgment fixing the reasonable value of the
property sought to be expropriated at P117.00 per square meter or for a total amount
of Three Hundred Seventeen Thousand Eight Hundred Eighty Nine Pesos
(P317,889.00), and the value of the improvement at Thirty Six Thousand Five
Hundred Pesos (P36,500.00), this amount to bear interest at the legal rate from the
filing of the complaint until paid with costs against the plaintiff.

SO ORDERED. 6

Both petitioner and private respondent filed their respective motions for reconsideration, the former
praying that the trial court give due course to the commissioner's report while the latter insisting that
the market value of the land be fixed at P200.00 per square meter. Upon denial of the said motions,
both parties then appealed to the Court of Appeals.

On October 18, 1972, respondent Court of Appeals rendered a decision sustaining the valuation of
the property in 1969, declaring the municipality to have a lawful right to expropriate and modified the
judgment of the trial court with respect to the interest that can be recovered which should be from
and after the date of actual taking.

Petitioner's motion for reconsideration having been denied, the instant petition for review on
certiorari was filed and the following assignment of errors raised:

I. Contrary to law and jurisprudence, the Court of Appeals erred in the interpretation
and application of Section 4, Rule 67 of the Rules of Court by determining the value
of the property in condemnation proceedings at the time of the rendition of the
judgment of the trial court and not at the date of the filing of the complaint.

II. Contrary to the principle of res judicata, the Court of Appeals gravely abused its
power in modifying, disregarding and amending its own decision which has long
become final and executory (in CA-G.R. No. 32259-R).

III. Without regard to the guidelines set forth by procedural laws and jurisprudence,
the Court of Appeals erred in giving credence to an appraiser under the employ of
the private respondent and totally disregarded the findings of the commissioners
appointed by the Court and the by not declaring that the trial judge of Branch II of the
Court of First Instance of Camarines Norte has gravely abused his discretion in
taking cognizance of the condemnation case.

IV. In any event, by virtue of the Presidential Decree No. 42 issued on November 9,
1972 private respondent in estopped from claiming in valuation higher than the
assessed value of the property sought to be condemned. 7
The first assignment of error assails the respondent Court's application of Section 4, Rule 67 of the
Revised Rules of Court which states the time when the value of the land should be determined in
condemnation proceedings. The Rule provides thus:

Sec. 4. Order of condemnation. — When such a motion is overruled or when any

party fails to defend as required by this rule, the court may enter an order of
condemnation declaring that the plaintiff has a lawful right to take the property sought
to be condemned, for the public use or purpose described in the complaint, upon
payment of just compensation to be determined as of the date of the filing of the
complaint ...

A look into the original of this provision reveals that it is a reproduction of Section 5, Rule 69 of the
Rules of Court of July 1, 1940. In turn, the said provision in the Rules of 1940 appears to have been
taken from the ruling Manila Railroad Company vs. Caligsihan, a 1919 case, where the rule that "the
8

value of the property taken should be fixed as of the date of the proceedings" was enunciated.

Prior to the promulgation of the Rules of 1940, however, there is another case that touched on the
question of time when valuation of the property taken should be fixed. This is the case of Provincial
Government of Rizal vs. Caro de Araullo a 1938 case, where the value of the property therein
9

involved was fixed as of the date when it was taken in 1927 and not at the time of the filing of the
complaint in 1928. This ruling was reiterated in Republic vs. Lara, a 1954 case, where it was held
10

that the value of the lands expropriated must be reckoned as of the time of the actual possession by
the Government in 1946 and not as of the time of the filing of the complaint in 1949. Such was the
ruling notwithstanding the fact that the Rules of 1940 was already in force and effect. In explaining
the ruling, the Court therein held:

... Ordinarily, inquiry is limited to actual market values at the time of the institution of
the condemnation proceedings because under normal circumstances, the filing of the
complaint coincides or even precedes the taking of the property by the plaintiff; and
Rule 69 simply fixes this convenient date for the valuation of property sought to be
expropriated. Where, however, the actual taking or occupation by the plaintiff, with
the consent of the landowner long precedes the filing of the complaint for
expropriation the rule to be followed must still be that enunciated by us in Provincial
Government of Rizal vs. Caro, supra, that "that value of the property should be fixed
as of the date when it was taken and not of the date of the filing of the proceedings."
For 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
of 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 it is
taken to the time the complaint is filed, due to general economic conditions. The
owner of the 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 the 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." (18 Am.
Jur. 873, 874)

Subsequent cases where the taking preceded the filing of the expropriation proceedings followed the
doctrine in the Caro case. These cases were: Republic vs. Garcellano, et al.; Municipal
11

Government of Sagay vs. Jison, et al.; and Alfonso vs. Pasay City. However, in the case
12 13

of Republic vs. Narciso, et al., where the expropriation proceeding preceded the taking, it was held
14

that the value of "the property to be considered are those at the beginning of the expropriation" and
not accordingly at the time of the taking of said property. For this reason, this Court fittingly saw the
need for clarify the departure of some cases from the mandate of Section 5, Rule 69 of the Rules of
Court of 1940 (now Section 4, Rule 67 of the Revised Rules of Court) in the case of Republic of the
Philippines vs. Philippine National Bank, where it was held:
15

It is apparent from the foregoing that, when plaintiff takes possession before the
institution of the condemnation proceedings, the value should be fixed as of the time
of the taking of the said possession, not the 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 5, directing that
compensation" be determined as of the date of the filing of the complaint," would
never be operative.

In Capitol Subdivision, Inc. vs. Province of Negros Occidental, 7 SCRA 60, the Court said that "Since
the right of the Province of Negros Occidental to expropriate the lot in question in the present case is
not contested, the owner of said lot is entitled to recover from said province the fair and full value of
the lot, as of the time when possession thereof was actually taken by the province, plus
consequential damages — including attorney's fees — from which the consequential benefits, if any,
should be deducted with interest at the legal rate, on the aggregate sum due to the owner from and
after the date of actual taking." And in the case of J.M. Tuason & Co., INc. vs. Land Tenure
Administration, 31 SCRA 413, the Court, speaking thru now Chief Justice Fernando, reiterated the
"well-settled (rule) of the property at the time of its taking. Anything beyond that is more and anything
short of that is less, than just compensation. It means a fair and full equivalent for the loss sustained,
which is the measure of the indemnity, not whatever gain would accrue to the expropriation entity."

In the case at bar, it is a fact that there has been no taking of the property prior to the institution of
the condemnation proceedings. And it cannot even be said that the filing of the complaint coincided
with he taking of the property by the plaintiff because the latter did not enter into possession of the
property since it failed or did not comply with the order of the Court requiring the municipality to
make the necessary deposit of the provisional value as fixed by the Court in its Order of April 15,
1969. Petitioner did not even move for a reconsideration of said Order. The trial proceeded and after
hearing and submission of evidence for both parties, the trial court rendered on December 2, 1969
its decision "fixing the reasonable value of the property sought to be expropriated at P117.00 per
square meter or for a total amount of Three Hundred Seventeen Thousand Eight Hundred Eighty
Nine Pesos (P317,889.00), and the value of the improvement at Thirty Six Thousand Five Hundred
Pesos (P36,500.00), said amount ... to bear interest at the legal rate from the date of the filing of the
complaint until paid."

Still questioning the value determined by the trial court, petitioner appealed to the Court of Appeals
and on October 8, 1972, the appellate court in its judgment fixed the value of the property at
P200.00 per square meter and P36,500.00 for the improvement. Not yet satisfied, the municipality
appealed to the Supreme Court and meantime took no step to take possession of the land. While
petitioner submitted a Manifestation on September 15, 1977 to this Court invoking Presidential
Decree No. 42 dated November 9, 1972 and manifesting that it had made a deposit to the Philippine
National Bank in the amount of P54,370.00 as per PNB Certificate No. 9381 dated February 9, 1973,
We hold that petitioner has not made the correct and proper deposit of the provisional value as fixed
by the trial court. It is elementary that Presidential Decree No. 42 of November 9, 1972 which grants
the right to take or enter upon the possession of the property sought to be expropriated if he
deposits with the Philippine National Bank an amount equivalent tot he assessed value of the
property for purposes of taxation has no application to the case at bar where the Court of Appeals
had already fixed the value of the property at P200.00 per square meter and P36,500.00 for the
improvement in its decision promulgated on October 18, 1972 about three weeks earlier than the
issuance of the Presidential Decree No. 42

By not complying with the orders of the trial court and the appellate court, petitioner would benefit by
its non-compliance and dilly-dallying in taking possession of the property which We will not sanction
or allow to the prejudice of the private respondent landowner who should not be penalized by the
protracted delay of petitioner in taking over the property over a period of seventeen (17) years during
which time private respondent was deprived of the beneficial use of the land and the improvement
thereon. Petitioner upon tiling the complaint has the duty to make the deposit in the amount
provisionally ascertained and fixed by the court (Sec. 2, Rule 67, Rules of Court), which deposit
serves the double purpose of pre- payment of the property if the same is finally expropriated and of
an indemnity for damages if the proceedings are dismissed. (Visayan Refining Co. vs. Camus, 40
Phil. 550; Republic of the Philippines vs. Baylosis, L-13582, Sept. 30, 1960)

The records disclose that petitioner filed a Motion for Authority to Demolish Building of Private
Respondent dated June 27, 1974 for reasons therein alleged which private respondent opposed as
not being the proper procedure under the law to abate a nuisance unless petitioner deposits the
amount of P36,500.00 which is the value of the improvement. The Court resolved to deny the motion
without prejudice to petitioner's taking the proper proceedings for the abatement of the alleged
nuisance pursuant to the provisions of the new Civil Code in its Resolution of July 24, 1974.

The records further disclose that in the Petition to Cite the Mayor of the Municipality of Daet (Herein
Petitioner) in Contempt of Court filed by private respondent on February 14, 1978, this Court was
informed that the petitioner acting thru its Mayor, Engineer Jose P. Timoner, started to demolish on
February 6, 1978 the building of the private respondent, attaching thereto photographs marked
Annexes 1 and 2 showing the building before and during the demolition. Private respondent prayed
that the Mayor be cited for contempt or alternatively, that the petitioner be ordered to deposit with the
Philippine National Bank the amount of P36,500.00 instead of P28,830.00 to await the final outcome
of this case.

Commenting on the petition to cite the Mayor in contempt of court, petitioner again relies on
Presidential Decree No. 42 alleging that the assessed value of the property for taxation purposes is
only P18,250.00 which is less than the amount of P28,830.00 it had already deposited with the
Philippine National Bank.

The above antecedent facts and circumstances of this case are unique and abnormal such that by
reason thereof, We agree with the judgment of the Court of Appeals fixing the fair market value of
the property sought to be expropriated at P200.00 per sq. meter or for a total of FIVE HUNDRED
FORTY THREE THOUSAND FOUR HUNDRED (P543,400.00) PESOS, and the value of the
improvement thereon at THIRTY SIX THOUSAND FIVE HUNDRED (P36,500.00) PESOS,
Philippine Currency, both amounts to bear legal interest from and after the date of the actual taking
of possession by the Municipality of Daet, Camarines Norte until the full amount is paid, with costs
against plaintiff-appellant.

We hold that the decision of the Court of Appeals fixing the market value of the property to be that
obtaining, at least, as of the date of the rendition of the judgment on December 2, 1969 as prayed by
private respondent, which the Court fixed at P200.00 per square meter is in conformity with doctrinal
rulings herein above cited that the value should be fixed as of the time of the taking of the
possession of the property because firstly, at the time judgment was rendered on December 2, 1969,
petitioner had not actually taken possession of the property sought to be expropriated and secondly,
We find the valuation determined by the Court of Appeals to be just, fair and reasonable.
On the second assignment of error, petitioner faults the respondent court in modifying, disregarding
and amending its own decision in CA-G.R. No. 32259-R which directed payment of just
compensation to be determined as of the date of the filing of the complaint. Petitioner claims that this
decision has tong become final and executory and it would be contrary to the doctrine of res
judicata to modify, disregard and amend said decision.

In order that there may be res judicata, the following requisites must be present: (a) the former
judgment must be final; (b) it must have been rendered by a court having jurisdiction of the subject-
matter and of the parties; (c) it must be a judgment on the merits; and (d) there must be, between
the first and second actions, Identity of parties, of subject matter, and of cause of action.16

When, between the first case where the judgment was rendered, and the second case where such
judgment is invoked, the three Identities mentioned in paragraph (d) above, are present, the
judgment on the merits rendered in the first case constitutes an absolute bar to the subsequent
action. It is final as to the claim or demand in the controversy, including the parties and those in
privity with them, not only as to every matter which was offered and received to sustain or defeat the
claim or demand, but as to any other admissible matter which might have been offered for that
purpose and of all matters that could have been adjudged in that case. 17

This is, however, not the situation in the case at bar. The only question drawn in issue before the
Court of Appeals in CA-G.R. No. 32259-R was whether petitioner had the authority to exercise the
right of eminent domain. The question regarding the amount of just compensation was expressly
reserved by the Court of Appeals for the trial court to determine. Perforce, Between the first case
wherein the judgment is rendered, and the second case wherein such judgment is invoked, there is
Identity of parties but there is no Identity of causes of action. In such a situation, the judgment is
conclusive in the second case only to those matters actually and directly controverted and
determined, and not as to matters merely involved therein. To constitute res judicata, the right to
relief in one suit must rest upon the same question which in essence and substance was litigated
and determined in the first suit.18

That phrase in the dispositive portion of the decision of the Court of Appeals in CA-G.R. No. 32259-
R referring to the time that should be considered in reckoning the just compensation, to wit —
"declaring that plaintiff Municipality of Daet has the lawful right to take the Property sought to be
condemned, for the public use described in the complaint, upon payment of just compensation to be
determined as of the date of the filing of the complaint" — cannot likewise constitute the law of the
case, which is a doctrine closely akin to res judicata. The law of the case, as applied to a former
decision of an appellate court, merely expresses the practice of the courts in refusing to reopen what
has been decided. It differs from res judicata in that the conclusiveness of the first judgment ' is not
19

dependent upon its finality. The first judgment is generally' if not universally, not final. It relates
20

entirely to questions of law, and is confined in its operation to subsequent proceedings in the same
case. While it is conclusive as to all matters within its scope, it cannot be invoked, except as to
21

questions as have been actually considered and determined in the first appeal. In the application of
this rule, courts will take cognizance of such points only as affirmatively appears in the last to have
been decided in the former appeal. 22

Moreover, this case is before the Supreme Court and being the Court of last resort, it is the final
arbiter of all legal questions properly brought before it and its decision in any given case constitutes
the law of this particular case. Once Our judgment becomes final, it is binding on all inferior courts,
and hence beyond their power and authority to alter or modify. (Kabigting vs. Acting Director oil
Prisons, 6 SCRA 281, 286). Petitioner's second assignment of error is, therefore, without merit.
The first part of the third assignment of error hinges on what is the proper procedure in determining
the just compensation in proceedings.

Section 5, Rule 67 of the Revised Rules of Court calls for the appointment of not more than three (3)
competent and disinterested persons as commissioners to ascertain and report to the court the just
compensation for the property sought to be taken. As to the extent of this function and power of the
commissioner, this Court held in Manila Railroad Company vs. Velasquez that the commissioners'
23

power is limited to assessing the value and determining the amount of damages. There it stops; they
can go no farther. The value and damages awarded must be a just compensation and no more and
no less. But in fixing these amounts, the commissioners are not to act ad libitum.They are to
discharge the trust reposed in them according to well-established rules and form their judgment
upon correct legal principles. To deny this is to place them where no one else in this country is
placed, above the law and beyond accountability.

Corollary to tills limitation, it has been held that reports submitted by commissioners of appraisals in
condemnation proceedings are not binding, but merely advisory in character, as far as the court is
concerned. An early case enunciated the rule that a Court of First Instance has the undoubted right
24

to reject the report of the commissioners as to the value of the land, if the report is not founded upon
legal evidence. The judge has the undoubted right also to discharge the commission and appoint a
new one. He also has the right to formulate an opinion of his own as to the value of the land in
question, nevertheless, if he formulates such an opinion, he must base it upon competent
evidence. When the commissioners report is not in accordance with the law on the matter, another
25

case ruled that it cannot serve as the basis of the judicial decision but must be annulled and set
aside, and the case remanded to the court below for reopening of trial. Then, in still other cases, it
26

was held that a Court of First Instance or on appeal, the Supreme Court may substitute its own
estimate of value as gathered from the record submitted to it, in cases where the only error of the
commissioners is that they have applied illegal principles to the evidence submitted to them; or that
they have disregarded a clear preponderance of evidence; or that they have used an improper rule
of assessment in arriving at the amount of the award; provided always that the evidence be clear
and convincing and the amount allowed by the commissioners is grossly inadequate or excessive. 27

That the commissioners' report is not final and conclusive, but merely recommendatory is bolstered
by the requirement in Section 8, Rule 67 of the Revised Rules of Court of conducting a hearing
thereon. Otherwise stated, said provision requires that upon the expiration of the period of ten (10)
days within which all interested parties may file their objects to the report, or even before the
expiration of such period if all interested parties have filed their objections to the report or their
statement of agreement therewith, the court must conduct a hearing on the report.

In view of these basic provisions of the Rules of Court on eminent domain and various jurisprudence
on the function of the commissioners as limited by the Court, We hold that the respondent Court of
Appeals did not err in giving credence to the appraiser employed by private respondent and in
disregarding the commissioners report.

Respondent court found that aside from being a civil engineer, Aurelio B. Aquino is a licensed real
estate broker and appraiser of long standing, being one of the incorporators of C.M. Hoskins and
Co., Inc., a corporation engaged in real estate brokerage since October, 1938 and of which firm he is
presently the Chairman of the board of directors. With these qualifications, respondent court
committed no error in concluding that he was competent to make the appraisal of the fair market
value of the parcel of land under consideration. Although he does not maintain an office in Daet nor
does he appear to have had any transactions in said locality, he is compatent since a commercial
parcel of land retains the same characteristics whether it is located in Manila or Daet, and the
criterion for making an appraisal of a parcel of land is universally applied, irrespective of the locality
where it is situated. And since the value of a parcel of land taken by eminent domain is always a
matter of opinion, the same may be proved by opinion evidence of the real estate
appraiser. Hence, We find substantial basis for the court to fix the value of the land at P200-00 per
28

square meter and the building at P36,500.00 as testified to by the broker.

Petitioner assails the transfer of the case from Branch I of the Court of First Instance of Camarines
Norte to Branch 11 thereof, claiming that the jurisdiction of the respective branches are delineated by
a controlling department circular and thereby concluding that Branch 11 has no legal and valid
authority to take over said expropriation case.

We do not agree. Where a court of first instance is divided into several branches, each of the
branches is not a court distinct and separate from the others. Jurisdiction is vested in the court, not
in the judges, so that when a complaint or information is filed before one branch or judge, jurisdiction
does not attach to said branch or judge alone, to the exclusion of the others. Trial may be had or
proceedings may continue by and before another branch or judge. It is for this reason that Section
57 of the Judiciary Act, expressly grants the Minister of Justice, upon recommendation of the district
Judge, the administrative right or power to apportion the cases among the different branches, both
for the convenience of the parties and the coordination of the work by the different branches, and the
judges presiding each branch. The apportionment does not involve a grant or limitation or
jurisdiction; this continues to be vested in the court of first instance of the province as a whole, and
trial may be had by any judge or branch of the court. 29

We do agree, however, that the apportionment of cases must be respected by the judges in the
interest of order and coordination in the dispatch of cases. But the question of whether Branch II
took cognizance of a case properly belonging to another branch is negated by the fact, pointed out
by respondents, that Administrative Order No. 472 of the Secretary of Justice dividing the Province
of Camarines Norte between Branch I and Branch II took effect on January 1, 1971 long after
Branch II had disposed of the case at bar because said case was decided on December 2, 1969.

The fourth assignment of error is clearly untenable. Presidential Decree No. 42 issued on November
9, 1972 does not limit the just compensation in expropriation proceedings to the assessed value of
the value sought to be condemned. By its title alone, i.e., "Authorizing the Plaintiff in Eminent
Domain Proceedings to Take Possession of the Property Involved Upon Depositing the Assessed
Value for Purposes of Taxation," it can already be gleaned that said decree fixes only the provisional
value of the property. As a provisional value, "it does not necessarily represent the true and correct
value of the land. The value is only "provisional" or "tentative" to serve as the basis for the immediate
occupancy of the property being expropriated by the condemnor. 30

This decree repealed Section 2, Rule 67 of the Revised Rules of Court which imposed upon the
court having jurisdiction of the proceeding with the duty of ascertaining and fixing the provisional
value of The property. As stated in the said decree itself, the repeal was necessary inasmuch as the
"existing procedure for the exercise of the right of eminent domain is not expeditious enough to
enable the plaintiff to take possession of the real property involved as soon as possible, when
needed for public purposes."

Even in Presidential Decree No. 76, "Requiring All Persons, Natural or Juridical Owning or
Administering Real Property, Including the Improvements Thereon, to File Sworn Statement of the
True Value of Such Property," issued on December 6, 1972, it is clearly stated that the just
compensation is based on the current and fair market value and not on the assessed value. The
pertinent provisions state as follows:
 For purposes of just compensation in cases of private property acquired by the
government for public use, the basis shall be the current and fair market value as
declared by the owner or administrator or such market value as determined by the
assessor, whichever is lower.

Under this Decree, the assessed valuation which shall be the basis for payment of
real property tax beginning the calendar year 1974 shall be fifty per centum of the
current fair market value, as determined by the assessor, in case of commercial,
industrial or mineral lands; forty per centum in the case of agricultural lands and thirty
per centum in the case of lands for purely residential purposes.

Clearly, therefore, the assessed value of a property constitutes only a percentage of its current fair
market value. It cannot, thus, be the direct basis of just compensation in expropriation proceedings.

But more importantly, this assignment of error is bereft of merit because Presidential Decree No. 42
is inapplicable in the case at bar. As pointed out by private respondent, it is a cardinal rule of
statutory construction that laws shall have only prospective effect. The provisional value of the
property in this case having already been fixed, the deposit on February 9, 1973 of the amount of
P54,370.00 representing the assessed value of the land and the deposit on October 21, 1977 of the
amount of P25,830.00 representing the assessed value of the improvement, both pursuant to the
said decree, are not sufficient. Nevertheless, said amounts should be deducted from the total
amount due to private respondent.

To elucidate and clarify the judgment of this Court in affirming the decision appealed from, We
consider and hold that the demolition of the building of private respondent standing on the land by
the Municipal Mayor, Engr. Jose P. Timoner on February 14, 1978 constituted the actual taking of
possession of the property sought to be expropriated by the Municipality of Daet. And from said date,
February 14, 1978, interest at the legal rate shall be paid by the municipality until the full amount is
paid.

IN VIEW OF ALL THE FOREGOING, the judgment under review is hereby AFFIRMED in toto.

SO ORDERED.

Claudio Teehankee, took no part.

Makasiar, Fernandez, De Castro and Melencio Herrera, JJ., concur.

National Housing Authority V. Hon. Pastor P. Reyes, 123

Scra 245 (1983)
Facts:

The undisputed fact that in this certiorari proceeding against respondent Judge for failure to comply
with the provision of the Presidential Decrees as to the amount to be paid by petitioner to entitle it to
a writ of possession in an expropriation proceeding, no question was raised as to their validity, calls for
the grant of the remedy sought. The controversy started with the filing of a complaint with the then
Court of Agrarian Relations, Seventh Regional District, Branch II, Cavite City, against private
respondents, for the expropriation, pursuant to Presidential Decree No. 757, of a parcel of land, with
an area of 25,000 square meters, owned and registered in the name of respondent Quirino Austria, and
needed for the expansion of the Dasmariñas Resettlement Project. Then came from petitioner about a
year later, a motion for the issuance of a writ of possession. Petitioner was able to secure an order
placing it in possession. Thereafter, private respondent Quirino Austria filed a Motion to Withdraw
Deposit in the amount of P6,600.00, a sum which was equivalent to the value of the property assessed
for taxation purposes and which was deposited by petitioner pursuant to Presidential Decree No. 42 .
There was an Opposition to the Motion to Withdraw Deposit by petitioner, citing Section 92 of
Presidential Decree No. 464. Petitioner's submission is that the owner's declaration at P1,400.00 which
is lower than the assessor's assessment, is the just compensation for the respondents' property,
respondents thus being precluded from withdrawing any amount more than P1,400.00. Respondent
Judge, however, issued an order dated July 13, 1978 which, according to petitioner, is clearly contrary
to the letter and spirit of the aforecited laws. There was a Motion for Reconsideration dated July 21,
1978. Its basis is the provision in Presidential Decree No. 1224: "In the determination of just
compensation for such private lands and improvement to be expropriated, the government shall choose
between the value of the real property and improvements thereon as declared by the owner or
administrator thereof or the market value determined by the City or provincial assessor, whichever is
lower, at the time of the filing of the expropriation complaint." It was then submitted that under the
aforequoted statutory provision, the owner's declared market value at P1,400.00 which is lower than
that fixed by the assessor is the just compensation of respondent Quirino Austria's property sought to
be expropriated. The motion for reconsideration was denied for lack of merit.

Issue: Whether or not there was just compensation.

Ruling:

The issue in this petition for certiorari and mandamus involves the application of a rule introduced by
P.D. No. 76 and reiterated in subsequent decrees that not only promotes social justice but also ends
the one-sided practice supported by the conniving consent of government officials and employees, of
under declaring properties for the purpose of taxation but ballooning the price thereof when the same
properties are to be acquired by the government for public purposes. Put to test is the power of the
government to introduce rationality in the laws and to discourage a deceitful practice that is not only
damaging to the government officers but also undermines its effort at awakening a democratic
responsiveness of the citizenry toward good government and its economic and social programs. The
courts should recognize that the rule introduced by P.D. 76 and reiterated in subsequent decrees does
not upset the established concepts of justice or the constitutional provision on just compensation for,
precisely, the owner is allowed to make his own valuation of his property. The writ of certiorari is
granted and the order of respondent judge of July 13, 1978 is hereby nullified and set aside.

G.R. No. L-32049 June 25, 1984

MATAAS NA LUPA TENANTS ASSOCIATION, INC., NICOLAS AGLABAY, and Those Mentioned
in Annex "A" of Complaint, petitioners,
vs.
CARLOS DIMAYUGA and JULIANA DIEZ Vda. de GABRIEL, respondents.
Ramon Gonzales for petitioners.

The Solicitor General and Magno T. Bueses for respondents.

MAKASIAR, J.:

This petition for review on certiorari presents for review the order dated October 30, 1969 of the
defunct Court of First Instance of Manila, Branch IV, which granted the motion to dismiss the
complaint of petitioners in Civil Case No. 75391 on the ground that the same failed to state a cause
of action (p. 16, rec.; pp. 1, 100, CFI rec.).

The undisputed facts are as follows:

On January 17, 1969, petitioners filed a complaint for the exercise of preferential rights with the then
Court of First Instance of Manila, Branch IV, docketed as Civil Case No. 75391 (p. 32, rec.; p. 1, CFI
rec.).

The said complaint alleged that petitioner association has for its members Nicolas Aglabay, et al.,
named and listed in Annex "A" of said complaint, which members are heads of 110 tenant families,
and who have been, for more than ten years prior to 1959, occupants of a parcel of land (with their
110 houses built thereon), formerly owned by the respondent, Juliana Diez Vda. de Gabriel, to whom
petitioners have been paying rents for the lease thereof, but who, on May 14, 1968, without notice to
petitioners, sold the same to respondent Carlos Dimayuga, who, in turn, mortgaged the same to her
for the balance of the purchase price; that according to Republic Act 1162, as amended by Republic
Act 2342, a parcel of land in Manila and suburbs, with at least fifty (50) houses of tenants erected
thereon and actually leased to said tenants for at least ten (10) years prior to June 20, 1959, may not
be sold by the landowner to any person other than such tenants, unless the latter renounced their
rights in a public instrument; that without said tenants-appellants having renounced their preferential
rights in public instrument, respondent Vda. de Gabriel sold the land to respondent Dimayuga; that
petitioners-tenants are willing to purchase said land at the same price and on the same terms and
conditions observed in the contract of sale with respondent Dimayuga; and that since aforesaid
contract of sale is expressly prohibited by law, the same is null and void, while it is mandatory for
respondent Vda. de Gabriel to execute such sale to petitioners, Petitioners therefore prayed that
said contract of sale be declared void, and that respondent Vda. de Gabriel be ordered to execute a
deed of sale in favor of petitioners at the same price and conditions followed in the contract with
respondent Dimayuga, plus attorney's fees and damages (p. 32, rec.; p. 1, CFI rec.).

On January 31, 1969, respondent Vda. de Gabriel filed a motion to dismiss on the ground that the
complaint stated no cause of action because the land subject of the complaint is not a landed estate,
and not being such, the same cannot be expropriated, and not being expropriable, no preferential
rights could be availed of by the tenants (p. 41, rec.; p. 22, CFI rec.).

Respondent Dimayuga filed his answer to aforesaid complaint on February 6, 1969 admitting therein
certain factual allegations, denied some averments, interposed the affirmative defenses that plaintiffs
had no personality to initiate the action since the Land Tenure Administration possessed the power
to institute the proper expropriation proceedings before the competent court and that the subject
complaint stated no cause of action against respondent, alleged a counterclaim to eject plaintiffs
from the property, and prayed for the dismissal of the complaint and other remedies (p. 44, rec.; p.
155, CFI rec.).lwphl@itç
On February 6, 1969, plaintiffs-petitioners filed their opposition to the motion to dismiss, maintaining,
among others, that Republic Act 1162, as amended by Republic Act 2342 (law which respondent
Vda. de Gabriel invoked), does not necessarily refer to landed estates, but to any piece of land
occupied by more than 50 families leasing the same for more than ten (10) years prior to June 20,
1959; that their preferential rights are independent of the expropriability of the land; that therefore,
said rights may be exercised even if the land is not expropriable; and that these rights were granted
pursuant to the police power of the State for the general welfare, with prayer that aforesaid motion to
dismiss be denied (p. 47, rec.; p. 26, CFI rec.).

On February 13, 1969, respondent Vda. de Gabriel replied to the aforesaid opposition to motion to
dismiss, reiterating therein her prayer to dismiss the complaint (p. 57, rec.; p. 38, CFI rec.).

Plaintiffs-petitioners filed their rejoinder to above reply to their opposition on February 19, 1969,
laying emphasis on the alleged distinction between the two ways of acquiring occupied land under
Republic Act 1162, which are expropriation and voluntary disposal of the land by the owner thereof,
and which are exercisable independently of each other (p. 56, rec.; p. 42, CFI rec.).

On October 30, 1969, Branch IV of the Court of First Instance of Manila issued the subject order
which found respondent's motion to dismiss well-taken and thereby dismissed the complaint (p. 69,
rec.; p. 100, CFI rec.).

Petitioners moved for reconsideration of the aforecited order on January 7, 1970, which motion was
denied in the lower court's order of January 27, 1970 (p. 111, 190, CFI rec.).

On February 9, 1970, petitioners filed a notice of appeal with the lower court to which respondent
Vda. de Gabriel moved for dismissal of the same on February 11, 1970 on the alleged ground that
pursuant to Republic Act 5440, petitioners should have appealed from the questioned order by way
of a petition for certiorari to this Court since the matter involved only errors or questions of law (p.
143, CFI rec.).

After a series of motions, reply, rejoinder, sur-rejoinder, and answer between both parties, the lower
court issued its order of May 11, 1970 dismissing petitioners' appeal (p. 225, CFI rec.).

Petitioners thus resorted to this petition.

Petitioners contend that the lower court committed an error in dismissing their complaint on the
ground that since the land is not expropriable, it follows that the tenants therein have no preferential
rights to buy said land, if the same is sold voluntarily. Petitioners' contention is anchored on the
amendment introduced by Republic Act 3516 into Section 1 of Republic Act 1162, which latter law
had been invoked in the decision of the lower court.

According to petitioners, the phrase "any landed estates or haciendas herein authorized to be
expropriated" had been amended to read "any landed estates or haciendas or lands herein
authorized to be expropriated"; hence, Republic Act 1162 does not refer exclusively to landed
estates or haciendas, but even to smaller lands. The particular section as amended reads thus:

The expropriation of landed estates or haciendas, or lands which formerly formed

part thereof, or any piece of land in the City of Manila, Quezon City and suburbs,
which have been and are actually being leased to tenants for at least ten years, is
hereby authorized: Provided, That such lands shall have at least forty families of
tenants thereon. (Sec. 1 of R. A. 3516).
Petitioners likewise invoke the amended title of Republic Act 1162 which had been introduced by
Republic Act 2342 which title now reads as follows:

An Act Providing for the Expropriation of Landed Estates or Haciendas or Lands

Which Formerly Formed Part Thereof or Any Piece of Land in the City of Manila,
Quezon City and Suburbs, Their Subdivision into Small Lots, and the Sale of Such
Lots at Cost or Their Lease on Reasonable Terms, and for Other Purposes
(emphasis supplied).

Petitioners further allege that Republic Act 1162 is both an exercise of the power of eminent domain
and the police power of the State. The exercise of the police power of the State refers to the grant of
preferential rights to the tenants of such land, if the same is disposed of voluntarily. Simply stated,
petitioners theorize that Republic Act 1162 covers both compulsory and voluntary sale; hence, while
expropriability is pertinent to compulsory sale, the same does not relate to voluntary sale. Even if the
land is not expropriable, if the same is however actually leased to the occupants for more than ten
years prior to May 22, 1963 (when R.A. 3516 took effect) with at least 40 families, said land, if sold
voluntarily, is subject to the preferential rights of the tenants.

Respondent Vda. de Gabriel maintains, on the other hand, that there is no more issue regarding the
non-expropriability of subject land, which condition or status was expressly admitted by petitioners in
the lower court; that the title of Republic Act 1162, as amended by Republic Act Nos. 2342 and 3516
clearly embraces expropriation; that the prohibitive acts enumerated in Section 5 of R.A. 1162, as
amended, are entirely dependent on the expropriability of the land in controversy; that there is
nothing in the aforecited law which validly supports the alleged preferential right of petitioners to
purchase the property at the same price and under the same conditions; that the only reasonable
interpretation of the opening lines of Section 5 of Republic Act 1162, as amended, is that pending
expropriation, the landowner shall not sell the land to any other person than the tenant or occupant
unless the latter renounces his rights in a public instrument; but if the land is not expropriable, as
petitioners have admitted, the prohibition does not apply; and that clearly, from the provision of
Section 6 of the amended law, Section 5 thereof may be violated only if the land is "herein
authorized to be expropriated" and since petitioners have admitted the non-expropriability of subject
land, it necessarily follows that said Section 5 cannot apply.

Respondent Dimayuga avers that Section 9, in relation to the title of R.A. 1162, clearly provides that
the preferential right could be exercised only when the land under question is subject to
expropriation, or better still, if the tenanted property which formerly formed part of an hacienda or is
a landed estate, had been expropriated; and, that R.A. 1162, as amended, embraces only landed
estates or haciendas with an extensive area.

The sole issue raised by petitioners is whether or not they have the pre-emptive or preferential rights
to buy the land in question.

WE find for petitioners.

The third proviso in Section 5 of Republic Act 3516, which law further amended R.A. 1162, reads:

Provided, furthermore, That no lot or portion thereof actually occupied by a tenant or

occupant shall be sold by the landowner to any other person than such tenant or
occupant, unless the latter renounce in a public instrument his rights under this Act:
Provided, finally, That if there shall be tenants who have constructed bona
 fide improvements on the lots leased by them, the rights of these tenants should be
recognized in the sale or in the lease of the lots, the limitation as to area in Section
three notwithstanding.

The provision clearly defines the preferential right of herein petitioners to buy the parcel of land. It
should be noted that respondent Vda. de Gabriel voluntarily sold the land to respondent Dimayuga
without informing the petitioners of the transaction. Respondent Vda. de Gabriel did not give the first
offer to petitioners who were then tenants-lessees and who would have either accepted or refused to
buy the land in a public 7 document. The fact is that on discovery of the sale to respondent dent
Dimayuga, petitioners filed their original claim for preferential rights eight months after the
clandestine sale. Thus, the condition set forth in the aforesaid proviso — that of offering first the sale
of the land to petitioners and the latter's renunciation in a public instrument — were not met when
the land was sold to respondent Dimayuga. Evidently, said sale was made illegally and, therefore,
void. Petitioners have still the first option to buy the land as provided for in the above provision.

II

A brief run down of this Court's decisions easily reveal the adherence to the principle that the test for
a valid expropriation of private land for resale to its occupants, is the number of families to be
benefited thereby, and not the area.

In his book on Constitutional Law, Dean Isagani A. Cruz recapitulates thus:

In the earlier case of Rural Progress Administration v. Reyes, the Supreme Court
held that the criterion for determining the validity of expropriation under this provision
was not the area of the land sought to be taken but the number of people intended to
be benefited thereby. The land, in other words, could be small provided it was
tenanted by a sizable number of people.

This ruling was abandoned in the case of Guido v. Rural Progress

Administration where the Supreme Court declared, also by a split decision as in
the Reyes case, that the test to be applied was the area of the land and not the
number of people who stood to be benefitted by the expropriation. The land should
be a landed estate or one comprising a very fast area. It was stressed that one of the
purposes of the framers was precisely to break up these estates in the hands of only
a few individuals or families and thus more equitably distribute them along the
landless.

xxx xxx xxx

It has also been held that where a landed estate is broken up into reasonable
portions which are thereafter sold to separate purchasers, the resultant portions
cannot be deemed as still subject to expropriation under this provision simply
because they used to form part of a landed estate.

In the case of Tuason v. PHHC, which was a petition for prohibition to nullify a law
directing the expropriation of Tatalon Estate in Quezon City, Justice Fernando
suggested a ruling to the Reyes ruling arguing that the propriety of expropriation
"could not be determined on a purely quantitative or area basis," quoting from Justice
J.B.L. Reyes in his dissenting opinion in the Baylosis Case. ... (p 71,1983 Ed.;
emphasis supplied).
From the Reyes case where the number of beneficiaries test was applied in determining public use
down to the Guido and Baylosis cases where the land or area size test was invoked, then to the
Tuason case where a return to the Reyes decision was made and then up to the recent case
of Pulido vs. Court of Appeals (L-57625, May 3, 1983; 122 SCRA 63) where this Court found it
"unfortunate that petitioner would be deprived of his land holdings, but his interest and that of his
family should not stand in the way of progress and the benefit of the greater majority of the
inhabitants of the country," there has evolved a clear pattern of adherence to the "number of people
to be benefited test.

This is made more manifest by the new constitutional provisions on the equitable diffusion of
property ownership and profits (Sec. 6, Art. 11) and the implementation of an agrarian reform
program aimed at emancipating the tenant from the bondage of the soil (Sec. 12, Art. XIV).

It has been noted with concern that while respondents raised the issue of expropriability of the parcel
of land, petitioners limited themselves to the issue of preferential or pre-emptive rights.

What petitioners might have failed to realize is that had they invoked the expropriability of subject
land, they would have had a foolproof case. Right from the start, they would have had the upper
hand. Ironically, however, instead of anchoring their case on the expropriability of such land, they
concentrated on asserting their preferential right to buy the land. For, Section 1 of R.A. 1162, as
amended by R.A. 3516, specifically authorizes the expropriation of any piece of land in the City of
Manila, Quezon City and suburbs which have been and are actually being leased to tenants for at
least ten (10) years, provided said lands have at least forty families of tenants thereon. The case at
bar comes within the coverage of the aforesaid legal provision since the parcel of land is located in
Manila which was then actually leased to 110 tenant families 20 years prior to the commencement of
this action in the lower court. Clearly, therefore, the land in question is capable of expropriation.

The above situation now brings Us back to the case of J.M. Tuason & Co. vs. Land Tenure
Administration (L-21064, Feb. 18, 1970, 31 SCRA 413-417) where this Court laid down certain basic
doctrines on the power of eminent domain. Thus, this Court, speaking thru then Justice Fernando,
declared:

It does not admit of doubt that the congressional power conferred by the Constitution
is far from limited. It is left to the legislative will to determine what lands may be
expropriated so that they could be subdivided for resale to those in need of them.
Nor can it be doubted either that as to when such authority may be exercised is
purely for Congress to decide. Its discretion on the matter is not to be interfered with.
This is shown by reference to the historical basis of the provision as reflected in the
proceedings of the Constitutional Convention.

Historical discussion while valuable is not necessarily decisive. It is easy to

understand why. The social and economic conditions are not static. They change
with the times. To Identify the text of a written constitution with the circumstances that
inspired its inclusion may render it incapable of being responsive to future needs.
Precisely, it is assumed to be one of the virtues of a written constitution that it suffices
to govern the life of the people not only at the time of its framing but far into the
indefinite future. It is not to be considered as so lacking in flexibility and suppleness
that it may be a bar to measures, novel and unorthodox, as they may appear to
some, but nonetheless imperatively called for.

xxx xxx xxx

 The framers of the Constitution were seriously concerned with the grave problems of
inequality of wealth, with its highly divisive tendency, resulting in the generous scope
accorded the police power and eminent domain prerogatives of the state, even if the
exercise thereof would cover terrain of property right previously thought of as beyond
state control, to promote social justice and the general welfare.

As in the case of the more general provision on eminent domain, the power to
expropriate lands under Sec. 4 of Art. XIII of the Constitution requires the payment of
just compensation, the taking to be for the public use, and to meet the exacting
standard of due process and equal protection guaranty of the Constitution.

xxx xxx xxx

The power granted to Congress by the Constitution to "authorize, upon payment of

just compensation, the expropriation of lands to be subdivided into small lots and
conveyed at cost to individuals" is unlimited by any other provision of the
Constitution. Just compensation is in reality a part of the power granted rather than a
limitation thereto, just as just compensation is of the essence in any exercise of the
power of eminent domain as, otherwise it would be plain commandeering.

While the taking must be for public use as a matter of principle, in the judicial
proceeding, the Government need not present evidence of such public use as a fact.
The constitutional provision itself declares the public objective, purpose or use of the
expropriation contemplated, hence, it should follow that as long as a congressional
legislation declares that the condemnation of a particular land is for the specific
purpose stated in the Constitution, it is not for the judiciary to inquire as to whether or
not the taking of such land is for public use. The Constitution itself which is supposed
to be the supreme law on private property rights declares it to be so, and leaves it to
Congress, not to the judiciary, to make the choice of the lands to be taken to attain
the objective the constituent assembly aimed to achieve. The scope and the limit of
the power of the judiciary in this regard is only to determine the existence of enabling
legislation, to see to it that the facts are as contemplated in such enabling act and to
provide the vehicle for compliance with procedural due process in the implementation
of the congressional act.

On the matter of taking for public use, Chief Justice Fernando summarily observed:

The taking to be valid must be for public use. There was a time when it was felt that a
literal meaning should be attached to such a requirement. Whatever project is
undertaken must be for the public to enjoy, as in the case of streets or parks.
Otherwise, expropriation is not allowable. It is not so any more. As long as the
purpose of the taking is public, then the power of eminent domain comes into play.
As just noted, the Constitution in at least two cases, to remove any doubt,
determines what is public use One is the expropriation of lands to be subdivided into
small lots for resale at cost to individuals. The other is the transfer, through the
exercise of this power, of utilities and other private enterprise to the government. It is
accurate to state then that at present whatever may be beneficially employed for the
general welfare satisfies the requirement of public use (The Constitution of the
Philippines, 2nd Ed., 1977, pp. 523-24).

III
This preferential right of petitioners and the power of eminent domain have been further mandated,
strengthened and expanded by recent developments in law and jurisprudence.

It must be recalled that the 1973 Constitution embodies certain original and innovative provisions on
eminent domain. The new Constitution provides thus:

Private property shall not be taken for public use without just compensation" (Sec. 2,
Art. IV).

The Batasang Pambansa may authorize, upon payment of just compensation, the
expropriation of private lands to be subdivided into small lots and conveyed at cost to
deserving citizens (See. 13, Art. XIV).

The State shall promote social justice to ensure the dignity, welfare and security of
affirmatively the people. Toward this end, the State shall regulate the acquisition
Ownership, use, enjoyment and disposition of private property, and equitably diffuse
property ownership and profits (Sec. 6, Art. 11; emphasis supplied).

The State shall establish, maintain, and ensure adequate social services in the field
of education, health, housing, employment, welfare, and social security to guarantee
the enjoyment by the people of a decent standard of living (Sec. 7, Art. 11).

The State shall formulate and implement an agrarian reform program aimed at
emancipating the tenant from the bondage of the soil and achieving the goals
enunciated in this Constitution (Sec. 12, Art. XIV).

The aforequoted Section 6 of Article 11, which is a modified version of the original provision of the
1935 Constitution, "emphasizes the stewardship concept, under which private property is supposed
to be held by the individual only as a trustee for the people in general, who are its real owners. As a
mere steward, the individual must exercise his rights to the proper- 4 ty not for his own exclusive and
selfish benefit but for the good of the entire community or nation" (p. 70, Phil. Political Law, Cruz,
1983 ed.). lwphl@itç

In the case of Almeda vs. Court of Appeals, et al. (L-43800, 78 SCRA 194 [July 29, 1977]), this Court
thus declared:

It is to be noted that under the new Constitution, property ownership is impressed

with social function. Property use must not only be for the benefit of the owner but of
society as well. The State, in the promotion of social justice, may "regulate the
acquisition, ownership, use, enjoyment and disposition of private property, and
equitably diffuse property — ownership and profits." One governmental policy of
recent date projects the emancipation of tenants from the bondage of the soil and the
transfer to them of the ownership of the land they till.

"The Legislature may regulate 'the acquisition, ownership, use, enjoyment and disposition of private
property,' to the end that maximum advantage can be derived from it by the people as a whole.
Thus, it may limit the size of private landholdings, impose higher taxes on agricultural lands that are
not being tilled, or provide for a wider distribution of land among the landless. ... (p. 70, Phil. Political
Law, Cruz, 1983 ed.).
It is obviously in the spirit of Sections 6 and 7 of Article 11 that P.D. No. 1517 on urban land reform
was enacted and the subsequent implementing Proclamation No. 1967 was issued. Significantly
also, the latest amendment to the Constitution on urban land reform and social housing program
which has been proclaimed by the President as having been approved in the recent plebiscite on
January 17, 1984 all the more emphasizes and strengthens the constitutional base for urban land
reform consistent with the provisions on social justice.

Even as we have consistently and explicitly pronounced that the power of eminent domain is a basic
and inherent power of government which does not have to be spelled out by the Constitution, still our
legislators felt such urgent demands for redistribution of land in this country that they had to
incorporate into the 1935 and 1973 Constitutions a specific provision on expropriation of land for
resale. Section 13, Article IV of the 1973 Constitution specially authorizes the expropriation of private
lands for resale.

Thus, as earlier mentioned, P.D. No. 1517 entitled "Proclaiming Urban Land Reform in the
Philippines and Providing for the Implementing Machinery Thereof" was enacted and beer effective
on June 1 1, 1978 and Proclamation No. 1967 was issued on May 14, 1980 as an implementing law.
This decree, which is firmly based on Section 6, Article 11 of the new Constitution, undoubtedly
adopts and crystallizes the greater number of people criterion when it speaks of tenants and
residents in declared urban land reform zones or areas without any mention of the land area covered
by such zones. The focus, therefore, is on people who would stand to benefit and not on the size of
the land involved.

It should now be clarified that Section 22 of the aforecited decree declares thus:

Sec. 22. Repealing Clause. — All laws, decrees, executive orders, rules and
regulations inconsistent herewith are hereby repealed, amended or modified
accordingly.

The decree has, therefore, superseded R.A. Nos. 1162, 2342 and 3516.

The issue of pre-emptive or preferential rights still remains for Our resolution within the purview of
the said decree.

The pertinent provisions of P.D. No. 1517 are as follows:

Sec. 4. Proclamation of Urban Land Reform Zones. — The President shall proclaim
specific parcels of urban and urbanizable lands as Urban Land Reform Zones,
otherwise known as Urban Zones for purposes of this Decree, which may include
Bagong Lipunan Sites, as defined in P.D. 1396 (par. 1 of the section).

xxx xxx xxx

Sec. 6. Land Tenancy in Urban Land Reform A Teas. Within the Urban Zones
legitimate tenants who have resided on the land for ten years or more who have built
their homes on the land and residents who have legally occupied the lands by
contract, continuously for the last ten years shall not be dispossessed of the land and
shall be allowed the right of first refusal to purchase the same within a reasonable
time and at reasonable prices, under terms and conditions to be determined by the
Urban Zone Expropriation and Land Management Committee created by Section 8 of
the Decree.
 xxx xxx xxx

Sec. 9. Compulsory Declaration of Sale and Preemptive Rights. Upon the

proclamation by the President of an area as an Urban Land Reform Zone, all
landowners, tenants and residents thereupon are required to declare to the Ministry
any proposal to sell, lease or encumber lands and improvements thereon, including
the proposed price, rent or value of encumbrances and secure approval of said
proposed transactions.

The Ministry shag have the pre-emptive right to acquire the above-mentioned lands
and improvements thereon which shall include, but shag not be limited to lands
occupied by tenants as provided for in Section 6 of this Decree (emphasis supplied).

Pursuant to the above decree and for purposes of making specific the applicability of the same and
other subsequent laws on the matter, the President issued Proclamation No. 1967 dated May 14,
1980 declaring Metropolitan Manila Area as Urban Land Reform Zone. Thus, on page 2, No. 14 of
said proclamation, Mataas na Lupa, the land in controversy, (an area bounded on the northwest by
Quirino Avenue, South Superhighway on the east, San Andres Street on the south, and on the west,
by Anak Bayan Street) was declared as an area for priority development and urban land reform
zone.

The aforequoted provisions of P.D. 1517 and the declaration in the aforesaid proclamation are clear
and leave no room for any interpretation. Evidently, petitioners' case falls squarely within the law.
Under Section 6 of the decree, the 110 tenant-families have been vested with the right of first refusal
to purchase the land in question within a reasonable time and reasonable prices, subject to Ministry
of Human Settlements rules and regulations.

WHEREFORE, THE ORDER DATED OCTOBER 30, 1969 OF THE THEN MANILA COURT OF
FIRST INSTANCE, BRANCH IV, IS HEREBY SET ASIDE AND THE MINISTRY OF HUMAN
SETTLEMENTS IS HEREBY DIRECTED TO FACILITATE AND ADMINISTER THE
IMPLEMENTATION OF THE RIGHTS OF HEREIN PETITIONERS. COSTS AGAINST
RESPONDENTS.

SO ORDERED.

Concepcion, Jr., Guerrero and Escolin, JJ., concur.

Aquino J., concurs in the result.

Abad Santos, J., I reserve my vote.

EPZA VS. DULAY [148 SCRA 305; G.R. No. L-59603; 29

Apr 1987]
Saturday, January 31, 2009 Posted by Coffeeholic Writes
Labels: Case Digests, Political Law
Facts: The four parcels of land which are the subject of this case is where the
Mactan Export Processing Zone Authority in Cebu (EPZA) is to be constructed.
Private respondent San Antonio Development Corporation (San Antonio, for
brevity), in which these lands are registered under, claimed that the lands were
expropriated to the government without them reaching the agreement as to the
compensation. Respondent Judge Dulay then issued an order for the
appointment of the commissioners to determine the just compensation. It was
later found out that the payment of the government to San Antonio would be
P15 per square meter, which was objected to by the latter contending that
under PD 1533, the basis of just compensation shall be fair and according to the
fair market value declared by the owner of the property sought to be
expropriated, or by the assessor, whichever is lower. Such objection and the
subsequent Motion for Reconsideration were denied and hearing was set for the
reception of the commissioner’s report. EPZA then filed this petition for
certiorari and mandamus enjoining the respondent from further hearing the
case.

Issue: Whether or Not the exclusive and mandatory mode of determining

just compensation in PD 1533 is unconstitutional.

Held: The Supreme Court ruled that the mode of determination of just
compensation in PD 1533 is unconstitutional.

The method of ascertaining just compensation constitutes impermissible

encroachment to judicial prerogatives. It tends to render the courts inutile in a
matter in which under the Constitution is reserved to it for financial
determination. The valuation in the decree may only serve as 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. The determination of just compensation is a
judicial function. The executive department or the legislature may make the
initial determination but when a party claims a violation of the guarantee in the
Bill of Rights that the private party 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 justness of the decreed compensation.

G.R. No. L-59603 April 29, 1987

EXPORT PROCESSING ZONE AUTHORITY, petitioner,

vs.
HON. CEFERINO E. DULAY, in his capacity as the Presiding Judge, Court of First Instance of
Cebu, Branch XVI, Lapu-Lapu City, and SAN ANTONIO DEVELOPMENT
CORPORATION, respondents.
Elena M. Cuevas for respondents.

GUTIERREZ, JR., J.:

The question raised in this petition is whether or not Presidential Decrees Numbered 76, 464, 794
and 1533 have repealed and superseded Sections 5 to 8 of Rule 67 of the Revised Rules of Court,
such that in determining the just compensation of property in an expropriation case, the only basis
should be its market value as declared by the owner or as determined by the assessor, whichever is
lower.

On January 15, 1979, the President of the Philippines, issued Proclamation No. 1811, reserving a
certain parcel of land of the public domain situated in the City of Lapu-Lapu, Island of Mactan, Cebu
and covering a total area of 1,193,669 square meters, more or less, for the establishment of an
export processing zone by petitioner Export Processing Zone Authority (EPZA).

Not all the reserved area, however, was public land. The proclamation included, among others, four
(4) parcels of land with an aggregate area of 22,328 square meters owned and registered in the
name of the private respondent. The petitioner, therefore, offered to purchase the parcels of land
from the respondent in acccordance with the valuation set forth in Section 92, Presidential Decree
(P.D.) No. 464, as amended. The parties failed to reach an agreement regarding the sale of the
property.

The petitioner filed with the then Court of First Instance of Cebu, Branch XVI, Lapu-Lapu City, a
complaint for expropriation with a prayer for the issuance of a writ of possession against the private
respondent, to expropriate the aforesaid parcels of land pursuant to P.D. No. 66, as amended, which
empowers the petitioner to acquire by condemnation proceedings any property for the establishment
of export processing zones, in relation to Proclamation No. 1811, for the purpose of establishing the
Mactan Export Processing Zone.

On October 21, 1980, the respondent judge issued a writ of possession authorizing the petitioner to
take immediate possession of the premises. On December 23, 1980, the private respondent flied its
answer.
At the pre-trial conference on February 13, 1981, the respondent judge issued an order stating that
the parties have agreed that the only issue to be resolved is the just compensation for the properties
and that the pre-trial is thereby terminated and the hearing on the merits is set on April 2, 1981.

On February 17, 1981, the respondent judge issued the order of condemnation declaring the
petitioner as having the lawful right to take the properties sought to be condemned, upon the
payment of just compensation to be determined as of the filing of the complaint. The respondent
judge also issued a second order, subject of this petition, appointing certain persons as
commissioners to ascertain and report to the court the just compensation for the properties sought to
be expropriated.

On June 19, 1981, the three commissioners submitted their consolidated report recommending the
amount of P15.00 per square meter as the fair and reasonable value of just compensation for the
properties.

On July 29, 1981, the petitioner Med a Motion for Reconsideration of the order of February 19, 1981
and Objection to Commissioner's Report on the grounds that P.D. No. 1533 has superseded
Sections 5 to 8 of Rule 67 of the Rules of Court on the ascertainment of just compensation through
commissioners; and that the compensation must not exceed the maximum amount set by P.D. No.
1533.

On November 14, 1981, the trial court denied the petitioner's motion for reconsideration and gave
the latter ten (10) days within which to file its objection to the Commissioner's Report.

On February 9, 1982, the petitioner flied this present petition for certiorari and mandamus with
preliminary restraining order, enjoining the trial court from enforcing the order dated February 17,
1981 and from further proceeding with the hearing of the expropriation case.

The only issue raised in this petition is whether or not Sections 5 to 8, Rule 67 of the Revised Rules
of Court had been repealed or deemed amended by P.D. No. 1533 insofar as the appointment of
commissioners to determine the just compensation is concerned. Stated in another way, is the
exclusive and mandatory mode of determining just compensation in P.D. No. 1533 valid and
constitutional?

The petitioner maintains that the respondent judge acted in excess of his jurisdiction and with grave
abuse of discretion in denying the petitioner's motion for reconsideration and in setting the
commissioner's report for hearing because under P.D. No. 1533, which is the applicable law herein,
the basis of just compensation shall be the fair and current market value declared by the owner of
the property sought to be expropriated or such market value as determined by the assessor,
whichever is lower. Therefore, there is no more need to appoint commissioners as prescribed by
Rule 67 of the Revised Rules of Court and for said commissioners to consider other highly variable
factors in order to determine just compensation. The petitioner further maintains that P.D. No. 1533
has vested on the assessors and the property owners themselves the power or duty to fix the market
value of the properties and that said property owners are given the full opportunity to be heard
before the Local Board of Assessment Appeals and the Central Board of Assessment Appeals. Thus,
the vesting on the assessor or the property owner of the right to determine the just compensation in
expropriation proceedings, with appropriate procedure for appeal to higher administrative boards, is
valid and constitutional.

Prior to the promulgation of P.D. Nos. 76, 464, 794 and 1533, this Court has interpreted the eminent
domain provisions of the Constitution and established the meaning, under the fundametal law, of just
compensation and who has the power to determine it. Thus, in the following cases, wherein the filing
of the expropriation proceedings were all commenced prior to the promulgation of the
aforementioned decrees, we laid down the doctrine onjust compensation:

Municipality of Daet v. Court of Appeals (93 SCRA 503, 516),

xxx xxx xxx

"And in the case of J.M. Tuason & Co., Inc. v. Land Tenure Administration, 31 SCRA 413, the Court,
speaking thru now Chief Justice Fernando, reiterated the 'well-settled (rule) that just compensation
means the equivalent for the value of the property at the time of its taking. Anything beyond that is
more and anything short of that is less, than just compensation. It means a fair and full equivalent for
the loss sustained, which is the measure of the indemnity, not whatever gain would accrue to the
expropriating entity."

Garcia v. Court ofappeals (102 SCRA 597, 608),

xxx xxx xxx

"Hence, in estimating the market value, all the capabilities of the property and all the uses to
which it may be applied or for which it is adapted are to be considered and not merely the
condition it is in the time and the use to which it is then applied by the owner. All the facts as
to the condition of the property and its surroundings, its improvements and capabilities may
be shown and considered in estimating its value."

Republic v. Santos (141 SCRA 30, 35-36),

"According to section 8 of Rule 67, the court is not bound by the commissioners' report. It
may make such order or render such judgment as shall secure to the plaintiff the property
essential to the exercise of his right of condemnation, and to the defendant just
compensation for the property expropriated. This Court may substitute its own estimate of
the value as gathered from the record (Manila Railroad Company v. Velasquez, 32 Phil.
286)."

However, the promulgation of the aforementioned decrees practically set aside the above and many
other precedents hammered out in the course of evidence-laden, well argued, fully heard, studiously
deliberated, and judiciously considered court proceedings. The decrees categorically and
peremptorily limited the definition of just compensation thus:

P.D. No. 76:

xxx xxx xxx

"For purposes of just compensation in cases of private property acquired by the government
for public use, the basis shall be the current and fair market value declared by the owner or
administrator, or such market value as determined by the Assessor, whichever is lower."

P.D. No. 464:

"Section 92. Basis for payment of just compensation in expropriation proceedings. — In

determining just compensation which private property is acquired by the government for
public use, the basis shall be the market value declared by the owner or administrator or
 anyone having legal interest in the property, or such market value as determined by the
assessor, whichever is lower."

P.D. No. 794:

"Section 92. Basis for payment of just compensation in expropriation proceedings. — In

determining just compensation when private property is acquired by the government for
public use, the same shall not exceed the market value declared by the owner or
administrator or anyone having legal interest in the property, or such market value as
determined by the assessor, whichever is lower."

P.D. No. 1533:

"Section 1. In determining just compensation for private property acquired through eminent
domain proceedings, the compensation to be paid shall not exceed the value declared by the
owner or administrator or anyone having legal interest in the property or determined by the
assessor, pursuant to the Real Property Tax Code, whichever value is lower, prior to the
recommendation or decision of the appropriate Government office to acquire the property."

We are constrained to declare the provisions of the Decrees on just compensation unconstitutional
and void and accordingly dismiss the instant petition for lack of merit.

The method of ascertaining just compensation under the aforecited decrees constitutes
impermissible encroachment on judicial prerogatives. It tends to render this Court inutile in a matter
which under the Constitution is reserved to it for final determination.

Thus, although in an expropriation proceeding the court technically would still have the power to
determine the just compensation for the property, following the applicable decrees, its task would be
relegated to simply stating the lower value of the property as declared either by the owner or the
assessor. As a necessary consequence, it would be useless for the court to appoint commissioners
under Rule 67 of the Rules of Court. Moreover, the need to satisfy the due process clause in the
taking of private property is seemingly fulfilled since it cannot be said that a judicial proceeding was
not had before the actual taking. However, the strict application of the decrees during the
proceedings would be nothing short of a mere formality or charade as the court has only to choose
between the valuation of the owner and that of the assessor, and its choice is always limited to the
lower of the two. The court cannot exercise its discretion or independence in determining what is just
or fair. Even a grade school pupil could substitute for the judge insofar as the determination of
constitutional just compensation is concerned.

In the case of National Housing Authority v. Reyes (123 SCRA 245), this Court upheld P.D. No. 464,
as further amended by P.D. Nos. 794, 1224 and 1259. In this case, the petitioner National Housing
Authority contended that the owner's declaration at P1,400.00 which happened to be lower than the
assessor's assessment, is the just compensation for the respondent's property under section 92 of
P.D. No. 464. On the other hand, the private respondent stressed that while there may be basis for
the allegation that the respondent judge did not follow the decree, the matter is still subject to his
final disposition, he having been vested with the original and competent authority to exercise his
judicial discretion in the light of the constitutional clauses on due process and equal protection.

To these opposing arguments, this Court ruled ihat under the conceded facts, there should be a
recognition that the law as it stands must be applied; that the decree having spoken so clearly and
unequivocably calls for obedience; and that on a matter where the applicable law speaks in no
uncertain language, the Court has no choice except to yield to its command. We further stated that
"the courts should recognize that the rule introduced by P.D. No. 76 and reiterated in subsequent
decrees does not upset the established concepts of justice or the constitutional provision on just
compensation for, precisely, the owner is allowed to make his own valuation of his property."

While the Court yielded to executive prerogative exercised in the form of absolute law-making power,
its members, nonetheless, remained uncomfortable with the implications of the decision and the
abuse and unfairness which might follow in its wake. For one thing, the President himself did not
seem assured or confident with his own enactment. It was not enough to lay down the law on
determination of just compensation in P.D. 76. It had to be repeated and reiterated in P.D. 464, P.D.
794, and P.D. 1533. The provision is also found in P.D. 1224, P.D. 1259 and P.D. 1313. Inspite of its
effectivity as general law and the wide publicity given to it, the questioned provision or an even
stricter version had to be embodied in cases of specific expropriations by decree as in P.D. 1669
expropriating the Tambunting Estate and P.D. 1670 expropriating the Sunog Apog area in Tondo,
Manila.

In the present petition, we are once again confronted with the same question of whether the courts
under P.D. 1533, which contains the same provision on just compensation as its predecessor
decrees, still have the power and authority to determine just compensation, independent of what is
stated by the decree and to this effect, to appoint commissioners for such purpose.

This time, we answer in the affirmative.

In overruling the petitioner's motion for reconsideration and objection to the commissioner's report,
the trial court said:

"Another consideration why the Court is empowered to appoint commissioners to assess the
just compensation of these properties under eminent domain proceedings, is the well-
entrenched ruling that 'the owner of property expropriated is entitled to recover from
expropriating authority the fair and full value of the lot, as of the time when possession
thereof was actually taken by the province, plus consequential damages — including
attorney's fees — from which the consequential benefits, if any should be deducted, with
interest at the legal rate, on the aggregate sum due to the owner from and after the date of
actual taking.' (Capitol Subdivision, Inc. v. Province of Negros Occidental, 7 SCRA 60). In
fine, the decree only establishes a uniform basis for determining just compensation which the
Court may consider as one of the factors in arriving at 'just compensation,' as envisage in the
Constitution. In the words of Justice Barredo, "Respondent court's invocation of General
Order No. 3 of September 21, 1972 is nothing short of an unwarranted abdication of judicial
authority, which no judge duly imbued with the implications of the paramount principle of
independence of the judiciary should ever think of doing." (Lina v. Purisima, 82 SCRA 344,
351; Cf. Prov. of Pangasinan v. CFI Judge of Pangasinan, Br. VIII, 80 SCRA 117) Indeed,
where this Court simply follows PD 1533, thereby limiting the determination of just
compensation on the value declared by the owner or administrator or as determined by the
Assessor, whichever is lower, it may result in the deprivation of the landowner's right of due
process to enable it to prove its claim to just compensation, as mandated by the Constitution.
(Uy v. Genato, 57 SCRA 123). The tax declaration under the Real Property Tax Code is,
undoubtedly, for purposes of taxation."

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. A return to the earlier well-established doctrine, to our mind, is more in keeping with
the principle that the judiciary should live up to its mission "by vitalizing and not denigrating
constitutional rights." (See Salonga v. Cruz Paño, 134 SCRA 438, 462; citing Mercado v. Court of
First Instance of Rizal, 116 SCRA 93.) The doctrine we enunciated in National Housing Authority v.
Reyes, supra, therefore, must necessarily be abandoned if we are to uphold this Court's role as the
guardian of the fundamental rights guaranteed by the due process and equal protection clauses and
as the final arbiter over transgressions committed against constitutional rights.

The basic unfairness of the decrees is readily apparent.

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.

In this particular case, the tax declarations presented by the petitioner as basis for just compensation
were made by the Lapu-Lapu municipal, later city assessor long before martial law, when land was
not only much cheaper but when assessed values of properties were stated in figures constituting
only a fraction of their true market value. The private respondent was not even the owner of the
properties at the time. It purchased the lots for development purposes. To peg the value of the lots
on the basis of documents which are out of date and at prices below the acquisition cost of present
owners would be arbitrary and confiscatory.

Various factors can come into play in the valuation of specific properties singled out for expropriation.
The values given by provincial assessors are usually uniform for very wide areas covering several
barrios or even an entire town with the exception of the poblacion. Individual differences are never
taken into account. The value of land is based on such generalities as its possible cultivation for rice,
corn, coconuts, or other crops. Very often land described as "cogonal" has been cultivated for
generations. Buildings are described in terms of only two or three classes of building materials and
estimates of areas are more often inaccurate than correct. Tax values can serve as guides but
cannot be absolute substitutes for just compensation.

To say that the owners are estopped to question the valuations made by assessors since they had
the opportunity to protest is illusory. The overwhelming mass of land owners accept unquestioningly
what is found in the tax declarations prepared by local assessors or municipal clerks for them. They
do not even look at, much less analyze, the statements. The Idea of expropriation simply never
occurs until a demand is made or a case filed by an agency authorized to do so.

It is violative of due process to deny to the owner the opportunity to prove that the valuation in the
tax documents is unfair or wrong. And it is repulsive to basic concepts of justice and fairness to allow
the haphazard work of a minor bureaucrat or clerk to absolutely prevail over the judgment of a court
promulgated only after expert commissioners have actually viewed the property, after evidence and
arguments pro and con have been presented, and after all factors and considerations essential to a
fair and just determination have been judiciously evaluated.

As was held in the case of Gideon v. Wainwright (93 ALR 2d,733,742):

"In the light of these and many other prior decisions of this Court, it is not surprising that the Betts
Court, when faced with the contention that 'one charged with crime, who is unable to obtain counsel
must be furnished counsel by the State,' conceded that '[E]xpressions in the opinions of this court
lend color to the argument. . .' 316 U.S., at 462, 463, 86 L ed. 1602, 62 S Ct. 1252. The fact is that in
deciding as it did-that "appointment of counsel is not a fundamental right, essential to a fair trial" —
the Court in Betts v. Brady made an ubrupt brake with its own well-considered precedents. In
returning to these old precedents, sounder we believe than the new, we but restore constitutional
principles established to achieve a fair system of justice. . ."
We return to older and more sound precedents. This Court has the duty to formulate guiding and
controlling constitutional principles, precepts, doctrines, or rules. (See Salonga v. Cruz Pano, supra).

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.

We, therefore, hold that P.D. No. 1533, which eliminates the court's discretion to appoint
commissioners pursuant to Rule 67 of the Rules of Court, is unconstitutional and void. To hold
otherwise would be to undermine the very purpose why this Court exists in the first place.

WHEREFORE, IN VIEW OF THE FOREGOING, the petition is hereby DISMISSED. The temporary
restraining order issued on February 16, 1982 is LIFTED and SET ASIDE.

SO ORDERED.

Fernan, Narvasa, Melencio-Herrera, Cruz, Paras, Feliciano, Gancayco, Padilla, Bidin, Sarmiento
and Cortes, JJ.,concur.
Teehankee, C.J., in the result.
Yap, J., on leave.
Petition dismissed. Order lifted and set aside.

75 SCRA 343 – Political Law – Constitutional Law – Bill of Rights – Equal Protection – Valid
Classification
Eminent Domain – Just Compensation
These are four consolidated cases questioning the constitutionality of the Comprehensive
Agrarian Reform Act (R.A. No. 6657 and related laws i.e., Agrarian Land Reform Code or
R.A. No. 3844).
Brief background: Article XIII of the Constitution on Social Justice and Human Rights
includes a call for the adoption by the State of an agrarian reform program. The State shall,
by law, undertake an agrarian reform program founded on the right of farmers and regular
farmworkers, who are landless, to own directly or collectively the lands they till or, in the
case of other farmworkers, to receive a just share of the fruits thereof. RA 3844 was
enacted in 1963. P.D. No. 27 was promulgated in 1972 to provide for the compulsory
acquisition of private lands for distribution among tenant-farmers and to specify maximum
retention limits for landowners. In 1987, President Corazon Aquino issued E.O. No. 228,
declaring full land ownership in favor of the beneficiaries of PD 27 and providing for the
valuation of still unvalued lands covered by the decree as well as the manner of their
payment. In 1987, P.P. No. 131, instituting a comprehensive agrarian reform program
(CARP) was enacted; later, E.O. No. 229, providing the mechanics for its (PP131 ’s)
implementation, was also enacted. Afterwhich is the enactment of R.A. No. 6657,
Comprehensive Agrarian Reform Law in 1988. This law, while considerably changing the
earlier mentioned enactments, nevertheless gives them suppletory effect insofar as they are
not inconsistent with its provisions.
[Two of the consolidated cases are discussed below]
G.R. No. 78742: (Association of Small Landowners vs Secretary)
The Association of Small Landowners in the Philippines, Inc. sought exception from the land
distribution scheme provided for in R.A. 6657. The Association is comprised of landowners
of ricelands and cornlands whose landholdings do not exceed 7 hectares. They invoke that
since their landholdings are less than 7 hectares, they should not be forced to distribute
their land to their tenants under R.A. 6657 for they themselves have shown willingness to till
their own land. In short, they want to be exempted from agrarian reform program because
they claim to belong to a different class.
G.R. No. 79777: (Manaay vs Juico)
Nicolas Manaay questioned the validity of the agrarian reform laws (PD 27, EO 228, and
229) on the ground that these laws already valuated their lands for the agrarian reform
program and that the specific amount must be determined by the Department of Agrarian
Reform (DAR). Manaay averred that this violated the principle in eminent domain which
provides that only courts can determine just compensation. This, for Manaay, also violated
due process for under the constitution, no property shall be taken for public use without just
compensation.
Manaay also questioned the provision which states that landowners may be paid for their
land in bonds and not necessarily in cash. Manaay averred that just compensation has
always been in the form of money and not in bonds.
ISSUE:
1. Whether or not there was a violation of the equal protection clause.
2. Whether or not there is a violation of due process.
3. Whether or not just compensation, under the agrarian reform program, must be in terms
of cash.
HELD:
1. No. The Association had not shown any proof that they belong to a different class exempt
from the agrarian reform program. Under the law, classification has been defined as the
grouping of persons or things similar to each other in certain particulars and different from
each other in these same particulars. To be valid, it must conform to the following
requirements:
(1) it must be based on substantial distinctions;
(2) it must be germane to the purposes of the law;
(3) it must not be limited to existing conditions only; and
(4) it must apply equally to all the members of the class.
Equal protection simply means that all persons or things similarly situated must be treated
alike both as to the rights conferred and the liabilities imposed. The Association have not
shown that they belong to a different class and entitled to a different treatment. The
argument that not only landowners but also owners of other properties must be made to
share the burden of implementing land reform must be rejected. There is a substantial
distinction between these two classes of owners that is clearly visible except to those who
will not see. There is no need to elaborate on this matter. In any event, the Congress is
allowed a wide leeway in providing for a valid classification. Its decision is accorded
recognition and respect by the courts of justice except only where its discretion is abused to
the detriment of the Bill of Rights. In the contrary, it appears that Congress is right in
classifying small landowners as part of the agrarian reform program.
2. No. It is true that the determination of just compensation is a power lodged in the courts.
However, there is no law which prohibits administrative bodies like the DAR from
determining just compensation. In fact, just compensation can be that amount agreed upon
by the landowner and the government – even without judicial intervention so long as both
parties agree. The DAR can determine just compensation through appraisers and if the
landowner agrees, then judicial intervention is not needed. What is contemplated by law
however is that, the just compensation determined by an administrative body is merely
preliminary. If the landowner does not agree with the finding of just compensation by an
administrative body, then it can go to court and the determination of the latter shall be the
final determination. This is even so provided by RA 6657:
Section 16 (f): Any party who disagrees with the decision may bring the matter to the court
of proper jurisdiction for final determination of just compensation.
3. No. Money as [sole] payment for just compensation is merely a concept in traditional
exercise of eminent domain. The agrarian reform program is a revolutionary exercise of
eminent domain. The program will require billions of pesos in funds if all compensation have
to be made in cash – if everything is in cash, then the government will not have sufficient
money hence, bonds, and other securities, i.e., shares of stocks, may be used for just
compensation.

G.R. No. 78742 July 14, 1989

ASSOCIATION OF SMALL LANDOWNERS IN THE PHILIPPINES, INC., JUANITO D. GOMEZ,

GERARDO B. ALARCIO, FELIPE A. GUICO, JR., BERNARDO M. ALMONTE, CANUTO RAMIR
B. CABRITO, ISIDRO T. GUICO, FELISA I. LLAMIDO, FAUSTO J. SALVA, REYNALDO G.
ESTRADA, FELISA C. BAUTISTA, ESMENIA J. CABE, TEODORO B. MADRIAGA, AUREA J.
PRESTOSA, EMERENCIANA J. ISLA, FELICISIMA C. ARRESTO, CONSUELO M. MORALES,
BENJAMIN R. SEGISMUNDO, CIRILA A. JOSE & NAPOLEON S. FERRER, petitioners,
vs.
HONORABLE SECRETARY OF AGRARIAN REFORM, respondent.

G.R. No. 79310 July 14, 1989

ARSENIO AL. ACUNA, NEWTON JISON, VICTORINO FERRARIS, DENNIS JEREZA,

HERMINIGILDO GUSTILO, PAULINO D. TOLENTINO and PLANTERS' COMMITTEE, INC.,
Victorias Mill District, Victorias, Negros Occidental, petitioners,
vs.
JOKER ARROYO, PHILIP E. JUICO and PRESIDENTIAL AGRARIAN REFORM
COUNCIL, respondents.

G.R. No. 79744 July 14, 1989

INOCENTES PABICO, petitioner,
vs.
HON. PHILIP E. JUICO, SECRETARY OF THE DEPARTMENT OF AGRARIAN REFORM, HON.
JOKER ARROYO, EXECUTIVE SECRETARY OF THE OFFICE OF THE PRESIDENT, and
Messrs. SALVADOR TALENTO, JAIME ABOGADO, CONRADO AVANCENA and ROBERTO
TAAY, respondents.

G.R. No. 79777 July 14, 1989

NICOLAS S. MANAAY and AGUSTIN HERMANO, JR., petitioners,

vs.
HON. PHILIP ELLA JUICO, as Secretary of Agrarian Reform, and LAND BANK OF THE
PHILIPPINES, respondents.

CRUZ, J.:

In ancient mythology, Antaeus was a terrible giant who blocked and challenged Hercules for his life
on his way to Mycenae after performing his eleventh labor. The two wrestled mightily and Hercules
flung his adversary to the ground thinking him dead, but Antaeus rose even stronger to resume their
struggle. This happened several times to Hercules' increasing amazement. Finally, as they continued
grappling, it dawned on Hercules that Antaeus was the son of Gaea and could never die as long as
any part of his body was touching his Mother Earth. Thus forewarned, Hercules then held Antaeus
up in the air, beyond the reach of the sustaining soil, and crushed him to death.

Mother Earth. The sustaining soil. The giver of life, without whose invigorating touch even the
powerful Antaeus weakened and died.

The cases before us are not as fanciful as the foregoing tale. But they also tell of the elemental
forces of life and death, of men and women who, like Antaeus need the sustaining strength of the
precious earth to stay alive.

"Land for the Landless" is a slogan that underscores the acute imbalance in the distribution of this
precious resource among our people. But it is more than a slogan. Through the brooding centuries, it
has become a battle-cry dramatizing the increasingly urgent demand of the dispossessed among us
for a plot of earth as their place in the sun.

Recognizing this need, the Constitution in 1935 mandated the policy of social justice to "insure the
well-being and economic security of all the people," especially the less privileged. In 1973, the new
1

Constitution affirmed this goal adding specifically that "the State shall regulate the acquisition,
ownership, use, enjoyment and disposition of private property and equitably diffuse property
ownership and profits." Significantly, there was also the specific injunction to "formulate and
2

implement an agrarian reform program aimed at emancipating the tenant from the bondage of the
soil."
3

The Constitution of 1987 was not to be outdone. Besides echoing these sentiments, it also adopted
one whole and separate Article XIII on Social Justice and Human Rights, containing grandiose but
undoubtedly sincere provisions for the uplift of the common people. These include a call in the
following words for the adoption by the State of an agrarian reform program:
 SEC. 4. The State shall, by law, undertake an agrarian reform program founded on
the right of farmers and regular farmworkers, who are landless, to own directly or
collectively the lands they till or, in the case of other farmworkers, to receive a just
share of the fruits thereof. To this end, the State shall encourage and undertake the
just distribution of all agricultural lands, subject to such priorities and reasonable
retention limits as the Congress may prescribe, taking into account ecological,
developmental, or equity considerations and subject to the payment of just
compensation. In determining retention limits, the State shall respect the right of
small landowners. The State shall further provide incentives for voluntary land-
sharing.

Earlier, in fact, R.A. No. 3844, otherwise known as the Agricultural Land Reform Code, had already
been enacted by the Congress of the Philippines on August 8, 1963, in line with the above-stated
principles. This was substantially superseded almost a decade later by P.D. No. 27, which was
promulgated on October 21, 1972, along with martial law, to provide for the compulsory acquisition
of private lands for distribution among tenant-farmers and to specify maximum retention limits for
landowners.

The people power revolution of 1986 did not change and indeed even energized the thrust for
agrarian reform. Thus, on July 17, 1987, President Corazon C. Aquino issued E.O. No. 228,
declaring full land ownership in favor of the beneficiaries of P.D. No. 27 and providing for the
valuation of still unvalued lands covered by the decree as well as the manner of their payment. This
was followed on July 22, 1987 by Presidential Proclamation No. 131, instituting a comprehensive
agrarian reform program (CARP), and E.O. No. 229, providing the mechanics for its implementation.

Subsequently, with its formal organization, the revived Congress of the Philippines took over
legislative power from the President and started its own deliberations, including extensive public
hearings, on the improvement of the interests of farmers. The result, after almost a year of spirited
debate, was the enactment of R.A. No. 6657, otherwise known as the Comprehensive Agrarian
Reform Law of 1988, which President Aquino signed on June 10, 1988. This law, while considerably
changing the earlier mentioned enactments, nevertheless gives them suppletory effect insofar as
they are not inconsistent with its provisions.4

The above-captioned cases have been consolidated because they involve common legal questions,
including serious challenges to the constitutionality of the several measures mentioned above. They
will be the subject of one common discussion and resolution, The different antecedents of each case
will require separate treatment, however, and will first be explained hereunder.

G.R. No. 79777

Squarely raised in this petition is the constitutionality of P.D. No. 27, E.O. Nos. 228 and 229, and
R.A. No. 6657.

The subjects of this petition are a 9-hectare riceland worked by four tenants and owned by petitioner
Nicolas Manaay and his wife and a 5-hectare riceland worked by four tenants and owned by
petitioner Augustin Hermano, Jr. The tenants were declared full owners of these lands by E.O. No.
228 as qualified farmers under P.D. No. 27.

The petitioners are questioning P.D. No. 27 and E.O. Nos. 228 and 229 on grounds inter alia of
separation of powers, due process, equal protection and the constitutional limitation that no private
property shall be taken for public use without just compensation.
They contend that President Aquino usurped legislative power when she promulgated E.O. No. 228.
The said measure is invalid also for violation of Article XIII, Section 4, of the Constitution, for failure
to provide for retention limits for small landowners. Moreover, it does not conform to Article VI,
Section 25(4) and the other requisites of a valid appropriation.

In connection with the determination of just compensation, the petitioners argue that the same may
be made only by a court of justice and not by the President of the Philippines. They invoke the
recent cases of EPZA v. Dulay andManotok v. National Food Authority. Moreover, the just
5 6

compensation contemplated by the Bill of Rights is payable in money or in cash and not in the form
of bonds or other things of value.

In considering the rentals as advance payment on the land, the executive order also deprives the
petitioners of their property rights as protected by due process. The equal protection clause is also
violated because the order places the burden of solving the agrarian problems on the owners only of
agricultural lands. No similar obligation is imposed on the owners of other properties.

The petitioners also maintain that in declaring the beneficiaries under P.D. No. 27 to be the owners
of the lands occupied by them, E.O. No. 228 ignored judicial prerogatives and so violated due
process. Worse, the measure would not solve the agrarian problem because even the small farmers
are deprived of their lands and the retention rights guaranteed by the Constitution.

In his Comment, the Solicitor General stresses that P.D. No. 27 has already been upheld in the
earlier cases ofChavez v. Zobel, Gonzales v. Estrella, and Association of Rice and Corn
7 8

Producers of the Philippines, Inc. v. The National Land Reform Council. The determination of just
9

compensation by the executive authorities conformably to the formula prescribed under the
questioned order is at best initial or preliminary only. It does not foreclose judicial intervention
whenever sought or warranted. At any rate, the challenge to the order is premature because no
valuation of their property has as yet been made by the Department of Agrarian Reform. The
petitioners are also not proper parties because the lands owned by them do not exceed the
maximum retention limit of 7 hectares.

Replying, the petitioners insist they are proper parties because P.D. No. 27 does not provide for
retention limits on tenanted lands and that in any event their petition is a class suit brought in behalf
of landowners with landholdings below 24 hectares. They maintain that the determination of just
compensation by the administrative authorities is a final ascertainment. As for the cases invoked by
the public respondent, the constitutionality of P.D. No. 27 was merely assumed in Chavez, while
what was decided in Gonzales was the validity of the imposition of martial law.

In the amended petition dated November 22, 1588, it is contended that P.D. No. 27, E.O. Nos. 228
and 229 (except Sections 20 and 21) have been impliedly repealed by R.A. No. 6657. Nevertheless,
this statute should itself also be declared unconstitutional because it suffers from substantially the
same infirmities as the earlier measures.

A petition for intervention was filed with leave of court on June 1, 1988 by Vicente Cruz, owner of a
1. 83- hectare land, who complained that the DAR was insisting on the implementation of P.D. No.
27 and E.O. No. 228 despite a compromise agreement he had reached with his tenant on the
payment of rentals. In a subsequent motion dated April 10, 1989, he adopted the allegations in the
basic amended petition that the above- mentioned enactments have been impliedly repealed by R.A.
No. 6657.

G.R. No. 79310

The petitioners herein are landowners and sugar planters in the Victorias Mill District, Victorias,
Negros Occidental. Co-petitioner Planters' Committee, Inc. is an organization composed of 1,400
planter-members. This petition seeks to prohibit the implementation of Proc. No. 131 and E.O. No.
229.

The petitioners claim that the power to provide for a Comprehensive Agrarian Reform Program as
decreed by the Constitution belongs to Congress and not the President. Although they agree that the
President could exercise legislative power until the Congress was convened, she could do so only to
enact emergency measures during the transition period. At that, even assuming that the interim
legislative power of the President was properly exercised, Proc. No. 131 and E.O. No. 229 would still
have to be annulled for violating the constitutional provisions on just compensation, due process,
and equal protection.

They also argue that under Section 2 of Proc. No. 131 which provides:

Agrarian Reform Fund.-There is hereby created a special fund, to be known as the Agrarian Reform
Fund, an initial amount of FIFTY BILLION PESOS (P50,000,000,000.00) to cover the estimated cost
of the Comprehensive Agrarian Reform Program from 1987 to 1992 which shall be sourced from the
receipts of the sale of the assets of the Asset Privatization Trust and Receipts of sale of ill-gotten
wealth received through the Presidential Commission on Good Government and such other sources
as government may deem appropriate. The amounts collected and accruing to this special fund shall
be considered automatically appropriated for the purpose authorized in this Proclamation the amount
appropriated is in futuro, not in esse. The money needed to cover the cost of the contemplated
expropriation has yet to be raised and cannot be appropriated at this time.

Furthermore, they contend that taking must be simultaneous with payment of just compensation as it
is traditionally understood, i.e., with money and in full, but no such payment is contemplated in
Section 5 of the E.O. No. 229. On the contrary, Section 6, thereof provides that the Land Bank of the
Philippines "shall compensate the landowner in an amount to be established by the government,
which shall be based on the owner's declaration of current fair market value as provided in Section 4
hereof, but subject to certain controls to be defined and promulgated by the Presidential Agrarian
Reform Council." This compensation may not be paid fully in money but in any of several modes that
may consist of part cash and part bond, with interest, maturing periodically, or direct payment in cash
or bond as may be mutually agreed upon by the beneficiary and the landowner or as may be
prescribed or approved by the PARC.

The petitioners also argue that in the issuance of the two measures, no effort was made to make a
careful study of the sugar planters' situation. There is no tenancy problem in the sugar areas that
can justify the application of the CARP to them. To the extent that the sugar planters have been
lumped in the same legislation with other farmers, although they are a separate group with problems
exclusively their own, their right to equal protection has been violated.

A motion for intervention was filed on August 27,1987 by the National Federation of Sugarcane
Planters (NASP) which claims a membership of at least 20,000 individual sugar planters all over the
country. On September 10, 1987, another motion for intervention was filed, this time by Manuel
Barcelona, et al., representing coconut and riceland owners. Both motions were granted by the
Court.

NASP alleges that President Aquino had no authority to fund the Agrarian Reform Program and that,
in any event, the appropriation is invalid because of uncertainty in the amount appropriated. Section
2 of Proc. No. 131 and Sections 20 and 21 of E.O. No. 229 provide for an initial appropriation of fifty
billion pesos and thus specifies the minimum rather than the maximum authorized amount. This is
not allowed. Furthermore, the stated initial amount has not been certified to by the National
Treasurer as actually available.

Two additional arguments are made by Barcelona, to wit, the failure to establish by clear and
convincing evidence the necessity for the exercise of the powers of eminent domain, and the
violation of the fundamental right to own property.

The petitioners also decry the penalty for non-registration of the lands, which is the expropriation of
the said land for an amount equal to the government assessor's valuation of the land for tax
purposes. On the other hand, if the landowner declares his own valuation he is unjustly required to
immediately pay the corresponding taxes on the land, in violation of the uniformity rule.

In his consolidated Comment, the Solicitor General first invokes the presumption of constitutionality
in favor of Proc. No. 131 and E.O. No. 229. He also justifies the necessity for the expropriation as
explained in the "whereas" clauses of the Proclamation and submits that, contrary to the petitioner's
contention, a pilot project to determine the feasibility of CARP and a general survey on the people's
opinion thereon are not indispensable prerequisites to its promulgation.

On the alleged violation of the equal protection clause, the sugar planters have failed to show that
they belong to a different class and should be differently treated. The Comment also suggests the
possibility of Congress first distributing public agricultural lands and scheduling the expropriation of
private agricultural lands later. From this viewpoint, the petition for prohibition would be premature.

The public respondent also points out that the constitutional prohibition is against the payment of
public money without the corresponding appropriation. There is no rule that only money already in
existence can be the subject of an appropriation law. Finally, the earmarking of fifty billion pesos as
Agrarian Reform Fund, although denominated as an initial amount, is actually the maximum sum
appropriated. The word "initial" simply means that additional amounts may be appropriated later
when necessary.

On April 11, 1988, Prudencio Serrano, a coconut planter, filed a petition on his own behalf, assailing
the constitutionality of E.O. No. 229. In addition to the arguments already raised, Serrano contends
that the measure is unconstitutional because:

(1) Only public lands should be included in the CARP;

(2) E.O. No. 229 embraces more than one subject which is not expressed in the title;

(3) The power of the President to legislate was terminated on July 2, 1987; and

(4) The appropriation of a P50 billion special fund from the National Treasury did not
originate from the House of Representatives.

G.R. No. 79744

The petitioner alleges that the then Secretary of Department of Agrarian Reform, in violation of due
process and the requirement for just compensation, placed his landholding under the coverage of
Operation Land Transfer. Certificates of Land Transfer were subsequently issued to the private
respondents, who then refused payment of lease rentals to him.
On September 3, 1986, the petitioner protested the erroneous inclusion of his small landholding
under Operation Land transfer and asked for the recall and cancellation of the Certificates of Land
Transfer in the name of the private respondents. He claims that on December 24, 1986, his petition
was denied without hearing. On February 17, 1987, he filed a motion for reconsideration, which had
not been acted upon when E.O. Nos. 228 and 229 were issued. These orders rendered his motion
moot and academic because they directly effected the transfer of his land to the private respondents.

The petitioner now argues that:

(1) E.O. Nos. 228 and 229 were invalidly issued by the President of the Philippines.

(2) The said executive orders are violative of the constitutional provision that no
private property shall be taken without due process or just compensation.

(3) The petitioner is denied the right of maximum retention provided for under the
1987 Constitution.

The petitioner contends that the issuance of E.0. Nos. 228 and 229 shortly before Congress
convened is anomalous and arbitrary, besides violating the doctrine of separation of powers. The
legislative power granted to the President under the Transitory Provisions refers only to emergency
measures that may be promulgated in the proper exercise of the police power.

The petitioner also invokes his rights not to be deprived of his property without due process of law
and to the retention of his small parcels of riceholding as guaranteed under Article XIII, Section 4 of
the Constitution. He likewise argues that, besides denying him just compensation for his land, the
provisions of E.O. No. 228 declaring that:

Lease rentals paid to the landowner by the farmer-beneficiary after October 21, 1972
shall be considered as advance payment for the land.

is an unconstitutional taking of a vested property right. It is also his contention that the inclusion of
even small landowners in the program along with other landowners with lands consisting of seven
hectares or more is undemocratic.

In his Comment, the Solicitor General submits that the petition is premature because the motion for
reconsideration filed with the Minister of Agrarian Reform is still unresolved. As for the validity of the
issuance of E.O. Nos. 228 and 229, he argues that they were enacted pursuant to Section 6, Article
XVIII of the Transitory Provisions of the 1987 Constitution which reads:

The incumbent president shall continue to exercise legislative powers until the first Congress is
convened.

On the issue of just compensation, his position is that when P.D. No. 27 was promulgated on
October 21. 1972, the tenant-farmer of agricultural land was deemed the owner of the land he was
tilling. The leasehold rentals paid after that date should therefore be considered amortization
payments.

In his Reply to the public respondents, the petitioner maintains that the motion he filed was resolved
on December 14, 1987. An appeal to the Office of the President would be useless with the
promulgation of E.O. Nos. 228 and 229, which in effect sanctioned the validity of the public
respondent's acts.
G.R. No. 78742

The petitioners in this case invoke the right of retention granted by P.D. No. 27 to owners of rice and
corn lands not exceeding seven hectares as long as they are cultivating or intend to cultivate the
same. Their respective lands do not exceed the statutory limit but are occupied by tenants who are
actually cultivating such lands.

According to P.D. No. 316, which was promulgated in implementation of P.D. No. 27:

No tenant-farmer in agricultural lands primarily devoted to rice and corn shall be

ejected or removed from his farmholding until such time as the respective rights of
the tenant- farmers and the landowner shall have been determined in accordance
with the rules and regulations implementing P.D. No. 27.

The petitioners claim they cannot eject their tenants and so are unable to enjoy their right of
retention because the Department of Agrarian Reform has so far not issued the implementing rules
required under the above-quoted decree. They therefore ask the Court for a writ of mandamus to
compel the respondent to issue the said rules.

In his Comment, the public respondent argues that P.D. No. 27 has been amended by LOI 474
removing any right of retention from persons who own other agricultural lands of more than 7
hectares in aggregate area or lands used for residential, commercial, industrial or other purposes
from which they derive adequate income for their family. And even assuming that the petitioners do
not fall under its terms, the regulations implementing P.D. No. 27 have already been issued, to wit,
the Memorandum dated July 10, 1975 (Interim Guidelines on Retention by Small Landowners, with
an accompanying Retention Guide Table), Memorandum Circular No. 11 dated April 21, 1978,
(Implementation Guidelines of LOI No. 474), Memorandum Circular No. 18-81 dated December
29,1981 (Clarificatory Guidelines on Coverage of P.D. No. 27 and Retention by Small Landowners),
and DAR Administrative Order No. 1, series of 1985 (Providing for a Cut-off Date for Landowners to
Apply for Retention and/or to Protest the Coverage of their Landholdings under Operation Land
Transfer pursuant to P.D. No. 27). For failure to file the corresponding applications for retention
under these measures, the petitioners are now barred from invoking this right.

The public respondent also stresses that the petitioners have prematurely initiated this case
notwithstanding the pendency of their appeal to the President of the Philippines. Moreover, the
issuance of the implementing rules, assuming this has not yet been done, involves the exercise of
discretion which cannot be controlled through the writ of mandamus. This is especially true if this
function is entrusted, as in this case, to a separate department of the government.

In their Reply, the petitioners insist that the above-cited measures are not applicable to them
because they do not own more than seven hectares of agricultural land. Moreover, assuming
arguendo that the rules were intended to cover them also, the said measures are nevertheless not in
force because they have not been published as required by law and the ruling of this Court
in Tanada v. Tuvera. As for LOI 474, the same is ineffective for the additional reason that a mere
10

letter of instruction could not have repealed the presidential decree.

Although holding neither purse nor sword and so regarded as the weakest of the three departments
of the government, the judiciary is nonetheless vested with the power to annul the acts of either the
legislative or the executive or of both when not conformable to the fundamental law. This is the
reason for what some quarters call the doctrine of judicial supremacy. Even so, this power is not
lightly assumed or readily exercised. The doctrine of separation of powers imposes upon the courts
a proper restraint, born of the nature of their functions and of their respect for the other departments,
in striking down the acts of the legislative and the executive as unconstitutional. The policy, indeed,
is a blend of courtesy and caution. To doubt is to sustain. The theory is that before the act was done
or the law was enacted, earnest studies were made by Congress or the President, or both, to insure
that the Constitution would not be breached.

In addition, the Constitution itself lays down stringent conditions for a declaration of
unconstitutionality, requiring therefor the concurrence of a majority of the members of the Supreme
Court who took part in the deliberations and voted on the issue during their session en banc. And 11

as established by judge made doctrine, the Court will assume jurisdiction over a constitutional
question only if it is shown that the essential requisites of a judicial inquiry into such a question are
first satisfied. Thus, there must be an actual case or controversy involving a conflict of legal rights
susceptible of judicial determination, the constitutional question must have been opportunely raised
by the proper party, and the resolution of the question is unavoidably necessary to the decision of
the case itself.12

With particular regard to the requirement of proper party as applied in the cases before us, we hold
that the same is satisfied by the petitioners and intervenors because each of them has sustained or
is in danger of sustaining an immediate injury as a result of the acts or measures complained
of. And even if, strictly speaking, they are not covered by the definition, it is still within the wide
13

discretion of the Court to waive the requirement and so remove the impediment to its addressing and
resolving the serious constitutional questions raised.

In the first Emergency Powers Cases, ordinary citizens and taxpayers were allowed to question the
14

constitutionality of several executive orders issued by President Quirino although they were invoking
only an indirect and general interest shared in common with the public. The Court dismissed the
objection that they were not proper parties and ruled that "the transcendental importance to the
public of these cases demands that they be settled promptly and definitely, brushing aside, if we
must, technicalities of procedure." We have since then applied this exception in many other cases. 15

The other above-mentioned requisites have also been met in the present petitions.

In must be stressed that despite the inhibitions pressing upon the Court when confronted with
constitutional issues like the ones now before it, it will not hesitate to declare a law or act invalid
when it is convinced that this must be done. In arriving at this conclusion, its only criterion will be the
Constitution as God and its conscience give it the light to probe its meaning and discover its
purpose. Personal motives and political considerations are irrelevancies that cannot influence its
decision. Blandishment is as ineffectual as intimidation.

For all the awesome power of the Congress and the Executive, the Court will not hesitate to "make
the hammer fall, and heavily," to use Justice Laurel's pithy language, where the acts of these
departments, or of any public official, betray the people's will as expressed in the Constitution.

It need only be added, to borrow again the words of Justice Laurel, that —

... when the judiciary mediates to allocate constitutional boundaries, it does not
assert any superiority over the other departments; it does not in reality nullify or
invalidate an act of the Legislature, but only asserts the solemn and sacred obligation
assigned to it by the Constitution to determine conflicting claims of authority under
the Constitution and to establish for the parties in an actual controversy the rights
which that instrument secures and guarantees to them. This is in truth all that is
 involved in what is termed "judicial supremacy" which properly is the power of judicial
review under the Constitution. 16

The cases before us categorically raise constitutional questions that this Court must categorically
resolve. And so we shall.

II

We proceed first to the examination of the preliminary issues before resolving the more serious
challenges to the constitutionality of the several measures involved in these petitions.

The promulgation of P.D. No. 27 by President Marcos in the exercise of his powers under martial law
has already been sustained in Gonzales v. Estrella and we find no reason to modify or reverse it on
that issue. As for the power of President Aquino to promulgate Proc. No. 131 and E.O. Nos. 228 and
229, the same was authorized under Section 6 of the Transitory Provisions of the 1987 Constitution,
quoted above.

The said measures were issued by President Aquino before July 27, 1987, when the Congress of
the Philippines was formally convened and took over legislative power from her. They are not
"midnight" enactments intended to pre-empt the legislature because E.O. No. 228 was issued on
July 17, 1987, and the other measures, i.e., Proc. No. 131 and E.O. No. 229, were both issued on
July 22, 1987. Neither is it correct to say that these measures ceased to be valid when she lost her
legislative power for, like any statute, they continue to be in force unless modified or repealed by
subsequent law or declared invalid by the courts. A statute does not ipso facto become inoperative
simply because of the dissolution of the legislature that enacted it. By the same token, President
Aquino's loss of legislative power did not have the effect of invalidating all the measures enacted by
her when and as long as she possessed it.

Significantly, the Congress she is alleged to have undercut has not rejected but in fact substantially
affirmed the challenged measures and has specifically provided that they shall be suppletory to R.A.
No. 6657 whenever not inconsistent with its provisions. Indeed, some portions of the said
17

measures, like the creation of the P50 billion fund in Section 2 of Proc. No. 131, and Sections 20 and
21 of E.O. No. 229, have been incorporated by reference in the CARP Law. 18

That fund, as earlier noted, is itself being questioned on the ground that it does not conform to the
requirements of a valid appropriation as specified in the Constitution. Clearly, however, Proc. No.
131 is not an appropriation measure even if it does provide for the creation of said fund, for that is
not its principal purpose. An appropriation law is one the primary and specific purpose of which is to
authorize the release of public funds from the treasury. The creation of the fund is only incidental to
19

the main objective of the proclamation, which is agrarian reform.

It should follow that the specific constitutional provisions invoked, to wit, Section 24 and Section
25(4) of Article VI, are not applicable. With particular reference to Section 24, this obviously could
not have been complied with for the simple reason that the House of Representatives, which now
has the exclusive power to initiate appropriation measures, had not yet been convened when the
proclamation was issued. The legislative power was then solely vested in the President of the
Philippines, who embodied, as it were, both houses of Congress.

The argument of some of the petitioners that Proc. No. 131 and E.O. No. 229 should be invalidated
because they do not provide for retention limits as required by Article XIII, Section 4 of the
Constitution is no longer tenable. R.A. No. 6657 does provide for such limits now in Section 6 of the
law, which in fact is one of its most controversial provisions. This section declares:
 Retention Limits. — Except as otherwise provided in this Act, no person may own or
retain, directly or indirectly, any public or private agricultural land, the size of which
shall vary according to factors governing a viable family-sized farm, such as
commodity produced, terrain, infrastructure, and soil fertility as determined by the
Presidential Agrarian Reform Council (PARC) created hereunder, but in no case shall
retention by the landowner exceed five (5) hectares. Three (3) hectares may be
awarded to each child of the landowner, subject to the following qualifications: (1)
that he is at least fifteen (15) years of age; and (2) that he is actually tilling the land or
directly managing the farm; Provided, That landowners whose lands have been
covered by Presidential Decree No. 27 shall be allowed to keep the area originally
retained by them thereunder, further, That original homestead grantees or direct
compulsory heirs who still own the original homestead at the time of the approval of
this Act shall retain the same areas as long as they continue to cultivate said
homestead.

The argument that E.O. No. 229 violates the constitutional requirement that a bill shall have only one
subject, to be expressed in its title, deserves only short attention. It is settled that the title of the bill
does not have to be a catalogue of its contents and will suffice if the matters embodied in the text are
relevant to each other and may be inferred from the title. 20

The Court wryly observes that during the past dictatorship, every presidential issuance, by whatever
name it was called, had the force and effect of law because it came from President Marcos. Such
are the ways of despots. Hence, it is futile to argue, as the petitioners do in G.R. No. 79744, that LOI
474 could not have repealed P.D. No. 27 because the former was only a letter of instruction. The
important thing is that it was issued by President Marcos, whose word was law during that time.

But for all their peremptoriness, these issuances from the President Marcos still had to comply with
the requirement for publication as this Court held in Tanada v. Tuvera. Hence, unless published in
21

the Official Gazette in accordance with Article 2 of the Civil Code, they could not have any force and
effect if they were among those enactments successfully challenged in that case. LOI 474 was
published, though, in the Official Gazette dated November 29,1976.)

Finally, there is the contention of the public respondent in G.R. No. 78742 that the writ of mandamus
cannot issue to compel the performance of a discretionary act, especially by a specific department of
the government. That is true as a general proposition but is subject to one important qualification.
Correctly and categorically stated, the rule is that mandamus will lie to compel the discharge of the
discretionary duty itself but not to control the discretion to be exercised. In other words, mandamus
can issue to require action only but not specific action.

Whenever a duty is imposed upon a public official and an unnecessary and

unreasonable delay in the exercise of such duty occurs, if it is a clear duty imposed
by law, the courts will intervene by the extraordinary legal remedy of mandamus to
compel action. If the duty is purely ministerial, the courts will require specific action. If
the duty is purely discretionary, the courts by mandamus will require action only. For
example, if an inferior court, public official, or board should, for an unreasonable
length of time, fail to decide a particular question to the great detriment of all parties
concerned, or a court should refuse to take jurisdiction of a cause when the law
clearly gave it jurisdiction mandamus will issue, in the first case to require a decision,
and in the second to require that jurisdiction be taken of the cause. 22
And while it is true that as a rule the writ will not be proper as long as there is still a plain, speedy
and adequate remedy available from the administrative authorities, resort to the courts may still be
permitted if the issue raised is a question of law. 23

III

There are traditional distinctions between the police power and the power of eminent domain that
logically preclude the application of both powers at the same time on the same subject. In the case
of City of Baguio v. NAWASA, for example, where a law required the transfer of all municipal
24

waterworks systems to the NAWASA in exchange for its assets of equivalent value, the Court held
that the power being exercised was eminent domain because the property involved was wholesome
and intended for a public use. Property condemned under the police power is noxious or intended for
a noxious purpose, such as a building on the verge of collapse, which should be demolished for the
public safety, or obscene materials, which should be destroyed in the interest of public morals. The
confiscation of such property is not compensable, unlike the taking of property under the power of
expropriation, which requires the payment of just compensation to the owner.

In the case of Pennsylvania Coal Co. v. Mahon, Justice Holmes laid down the limits of the police
25

power in a famous aphorism: "The general rule at least is that while property may be regulated to a
certain extent, if regulation goes too far it will be recognized as a taking." The regulation that went
"too far" was a law prohibiting mining which might cause the subsidence of structures for human
habitation constructed on the land surface. This was resisted by a coal company which had earlier
granted a deed to the land over its mine but reserved all mining rights thereunder, with the grantee
assuming all risks and waiving any damage claim. The Court held the law could not be sustained
without compensating the grantor. Justice Brandeis filed a lone dissent in which he argued that there
was a valid exercise of the police power. He said:

Every restriction upon the use of property imposed in the exercise of the police
power deprives the owner of some right theretofore enjoyed, and is, in that sense, an
abridgment by the State of rights in property without making compensation. But
restriction imposed to protect the public health, safety or morals from dangers
threatened is not a taking. The restriction here in question is merely the prohibition of
a noxious use. The property so restricted remains in the possession of its owner. The
state does not appropriate it or make any use of it. The state merely prevents the
owner from making a use which interferes with paramount rights of the public.
Whenever the use prohibited ceases to be noxious — as it may because of further
changes in local or social conditions — the restriction will have to be removed and
the owner will again be free to enjoy his property as heretofore.

Recent trends, however, would indicate not a polarization but a mingling of the police power and the
power of eminent domain, with the latter being used as an implement of the former like the power of
taxation. The employment of the taxing power to achieve a police purpose has long been
accepted. As for the power of expropriation, Prof. John J. Costonis of the University of Illinois
26

College of Law (referring to the earlier case of Euclid v. Ambler Realty Co., 272 US 365, which
sustained a zoning law under the police power) makes the following significant remarks:

Euclid, moreover, was decided in an era when judges located the Police and eminent
domain powers on different planets. Generally speaking, they viewed eminent
domain as encompassing public acquisition of private property for improvements that
would be available for public use," literally construed. To the police power, on the
other hand, they assigned the less intrusive task of preventing harmful externalities a
point reflected in the Euclid opinion's reliance on an analogy to nuisance law to
 bolster its support of zoning. So long as suppression of a privately authored harm
bore a plausible relation to some legitimate "public purpose," the pertinent measure
need have afforded no compensation whatever. With the progressive growth of
government's involvement in land use, the distance between the two powers has
contracted considerably. Today government often employs eminent domain
interchangeably with or as a useful complement to the police power-- a trend
expressly approved in the Supreme Court's 1954 decision in Berman v. Parker, which
broadened the reach of eminent domain's "public use" test to match that of the police
power's standard of "public purpose." 27

The Berman case sustained a redevelopment project and the improvement of blighted areas in the
District of Columbia as a proper exercise of the police power. On the role of eminent domain in the
attainment of this purpose, Justice Douglas declared:

If those who govern the District of Columbia decide that the Nation's Capital should
be beautiful as well as sanitary, there is nothing in the Fifth Amendment that stands
in the way.

Once the object is within the authority of Congress, the right to realize it through the
exercise of eminent domain is clear.

For the power of eminent domain is merely the means to the end. 28

In Penn Central Transportation Co. v. New York City, decided by a 6-3 vote in 1978, the U.S
29

Supreme Court sustained the respondent's Landmarks Preservation Law under which the owners of
the Grand Central Terminal had not been allowed to construct a multi-story office building over the
Terminal, which had been designated a historic landmark. Preservation of the landmark was held to
be a valid objective of the police power. The problem, however, was that the owners of the Terminal
would be deprived of the right to use the airspace above it although other landowners in the area
could do so over their respective properties. While insisting that there was here no taking, the Court
nonetheless recognized certain compensatory rights accruing to Grand Central Terminal which it
said would "undoubtedly mitigate" the loss caused by the regulation. This "fair compensation," as he
called it, was explained by Prof. Costonis in this wise:

In return for retaining the Terminal site in its pristine landmark status, Penn Central was authorized to
transfer to neighboring properties the authorized but unused rights accruing to the site prior to the
Terminal's designation as a landmark — the rights which would have been exhausted by the 59-story
building that the city refused to countenance atop the Terminal. Prevailing bulk restrictions on
neighboring sites were proportionately relaxed, theoretically enabling Penn Central to recoup its
losses at the Terminal site by constructing or selling to others the right to construct larger, hence
more profitable buildings on the transferee sites. 30

The cases before us present no knotty complication insofar as the question of compensable taking is
concerned. To the extent that the measures under challenge merely prescribe retention limits for
landowners, there is an exercise of the police power for the regulation of private property in
accordance with the Constitution. But where, to carry out such regulation, it becomes necessary to
deprive such owners of whatever lands they may own in excess of the maximum area allowed, there
is definitely a taking under the power of eminent domain for which payment of just compensation is
imperative. The taking contemplated is not a mere limitation of the use of the land. What is required
is the surrender of the title to and the physical possession of the said excess and all beneficial rights
accruing to the owner in favor of the farmer-beneficiary. This is definitely an exercise not of the police
power but of the power of eminent domain.
Whether as an exercise of the police power or of the power of eminent domain, the several
measures before us are challenged as violative of the due process and equal protection clauses.

The challenge to Proc. No. 131 and E.O. Nos. 228 and 299 on the ground that no retention limits are
prescribed has already been discussed and dismissed. It is noted that although they excited many
bitter exchanges during the deliberation of the CARP Law in Congress, the retention limits finally
agreed upon are, curiously enough, not being questioned in these petitions. We therefore do not
discuss them here. The Court will come to the other claimed violations of due process in connection
with our examination of the adequacy of just compensation as required under the power of
expropriation.

The argument of the small farmers that they have been denied equal protection because of the
absence of retention limits has also become academic under Section 6 of R.A. No. 6657.
Significantly, they too have not questioned the area of such limits. There is also the complaint that
they should not be made to share the burden of agrarian reform, an objection also made by the
sugar planters on the ground that they belong to a particular class with particular interests of their
own. However, no evidence has been submitted to the Court that the requisites of a valid
classification have been violated.

Classification has been defined as the grouping of persons or things similar to each other in certain
particulars and different from each other in these same particulars. To be valid, it must conform to
31

the following requirements: (1) it must be based on substantial distinctions; (2) it must be germane to
the purposes of the law; (3) it must not be limited to existing conditions only; and (4) it must apply
equally to all the members of the class. The Court finds that all these requisites have been met by
32

the measures here challenged as arbitrary and discriminatory.

Equal protection simply means that all persons or things similarly situated must be treated alike both
as to the rights conferred and the liabilities imposed. The petitioners have not shown that they
33

belong to a different class and entitled to a different treatment. The argument that not only
landowners but also owners of other properties must be made to share the burden of implementing
land reform must be rejected. There is a substantial distinction between these two classes of owners
that is clearly visible except to those who will not see. There is no need to elaborate on this matter. In
any event, the Congress is allowed a wide leeway in providing for a valid classification. Its decision
is accorded recognition and respect by the courts of justice except only where its discretion is
abused to the detriment of the Bill of Rights.

It is worth remarking at this juncture that a statute may be sustained under the police power only if
there is a concurrence of the lawful subject and the lawful method. Put otherwise, the interests of the
public generally as distinguished from those of a particular class require the interference of the State
and, no less important, the means employed are reasonably necessary for the attainment of the
purpose sought to be achieved and not unduly oppressive upon individuals. As the subject and
34

purpose of agrarian reform have been laid down by the Constitution itself, we may say that the first
requirement has been satisfied. What remains to be examined is the validity of the method employed
to achieve the constitutional goal.

One of the basic principles of the democratic system is that where the rights of the individual are
concerned, the end does not justify the means. It is not enough that there be a valid objective; it is
also necessary that the means employed to pursue it be in keeping with the Constitution. Mere
expediency will not excuse constitutional shortcuts. There is no question that not even the strongest
moral conviction or the most urgent public need, subject only to a few notable exceptions, will
excuse the bypassing of an individual's rights. It is no exaggeration to say that a, person invoking a
right guaranteed under Article III of the Constitution is a majority of one even as against the rest of
the nation who would deny him that right.

That right covers the person's life, his liberty and his property under Section 1 of Article III of the
Constitution. With regard to his property, the owner enjoys the added protection of Section 9, which
reaffirms the familiar rule that private property shall not be taken for public use without just
compensation.

This brings us now to the power of eminent domain.

IV

Eminent domain is an inherent power of the State that enables it to forcibly acquire
private lands intended for public use upon payment of just compensation to the
owner. Obviously, there is no need to expropriate where the owner is willing to sell
under terms also acceptable to the purchaser, in which case an ordinary deed of sale
may be agreed upon by the parties. It is only where the owner is unwilling to sell, or
35

cannot accept the price or other conditions offered by the vendee, that the power of
eminent domain will come into play to assert the paramount authority of the State
over the interests of the property owner. Private rights must then yield to the
irresistible demands of the public interest on the time-honored justification, as in the
case of the police power, that the welfare of the people is the supreme law.

But for all its primacy and urgency, the power of expropriation is by no means absolute (as indeed no
power is absolute). The limitation is found in the constitutional injunction that "private property shall
not be taken for public use without just compensation" and in the abundant jurisprudence that has
evolved from the interpretation of this principle. Basically, the requirements for a proper exercise of
the power are: (1) public use and (2) just compensation.

Let us dispose first of the argument raised by the petitioners in G.R. No. 79310 that the State should
first distribute public agricultural lands in the pursuit of agrarian reform instead of immediately
disturbing property rights by forcibly acquiring private agricultural lands. Parenthetically, it is not
correct to say that only public agricultural lands may be covered by the CARP as the Constitution
calls for "the just distribution of all agricultural lands." In any event, the decision to redistribute private
agricultural lands in the manner prescribed by the CARP was made by the legislative and executive
departments in the exercise of their discretion. We are not justified in reviewing that discretion in the
absence of a clear showing that it has been abused.

A becoming courtesy admonishes us to respect the decisions of the political departments when they
decide what is known as the political question. As explained by Chief Justice Concepcion in the case
of Tañada v. Cuenco: 36

The term "political question" connotes what it means in ordinary parlance, namely, a
question of policy. It refers to "those questions which, under the Constitution, are to
be decided by the people in their sovereign capacity; or in regard to which full
discretionary authority has been delegated to the legislative or executive branch of
the government." It is concerned with issues dependent upon the wisdom, not
legality, of a particular measure.

It is true that the concept of the political question has been constricted with the enlargement of
judicial power, which now includes the authority of the courts "to determine whether or not there has
been a grave abuse of discretion amounting to lack or excess of jurisdiction on the part of any
branch or instrumentality of the Government." Even so, this should not be construed as a license
37

for us to reverse the other departments simply because their views may not coincide with ours.

The legislature and the executive have been seen fit, in their wisdom, to include in the CARP the
redistribution of private landholdings (even as the distribution of public agricultural lands is first
provided for, while also continuing apace under the Public Land Act and other cognate laws). The
Court sees no justification to interpose its authority, which we may assert only if we believe that the
political decision is not unwise, but illegal. We do not find it to be so.

In U.S. v. Chandler-Dunbar Water Power Company, it was held:

38

Congress having determined, as it did by the Act of March 3,1909 that the entire St.
Mary's river between the American bank and the international line, as well as all of
the upland north of the present ship canal, throughout its entire length, was
"necessary for the purpose of navigation of said waters, and the waters connected
therewith," that determination is conclusive in condemnation proceedings instituted
by the United States under that Act, and there is no room for judicial review of the
judgment of Congress ... .

As earlier observed, the requirement for public use has already been settled for us by the
Constitution itself No less than the 1987 Charter calls for agrarian reform, which is the reason why
private agricultural lands are to be taken from their owners, subject to the prescribed maximum
retention limits. The purposes specified in P.D. No. 27, Proc. No. 131 and R.A. No. 6657 are only an
elaboration of the constitutional injunction that the State adopt the necessary measures "to
encourage and undertake the just distribution of all agricultural lands to enable farmers who are
landless to own directly or collectively the lands they till." That public use, as pronounced by the
fundamental law itself, must be binding on us.

The second requirement, i.e., the payment of just compensation, needs a longer and more
thoughtful examination.

Just compensation is defined as the full and fair equivalent of the property taken from its owner by
the expropriator. It has been repeatedly stressed by this Court that the measure is not the taker's
39

gain but the owner's loss. The word "just" is used to intensify the meaning of the word
40

"compensation" to convey the idea that the equivalent to be rendered for the property to be taken
shall be real, substantial, full, ample.
41

It bears repeating that the measures challenged in these petitions contemplate more than a mere
regulation of the use of private lands under the police power. We deal here with an actual taking of
private agricultural lands that has dispossessed the owners of their property and deprived them of all
its beneficial use and enjoyment, to entitle them to the just compensation mandated by the
Constitution.

As held in Republic of the Philippines v. Castellvi, there is compensable taking when the following
42

conditions concur: (1) the expropriator must enter a private property; (2) the entry must be for more
than a momentary period; (3) the entry must be under warrant or color of legal authority; (4) the
property must be devoted to public use or otherwise informally appropriated or injuriously affected;
and (5) the utilization of the property for public use must be in such a way as to oust the owner and
deprive him of beneficial enjoyment of the property. All these requisites are envisioned in the
measures before us.
Where the State itself is the expropriator, it is not necessary for it to make a deposit upon its taking
possession of the condemned property, as "the compensation is a public charge, the good faith of
the public is pledged for its payment, and all the resources of taxation may be employed in raising
the amount." Nevertheless, Section 16(e) of the CARP Law provides that:
43

Upon receipt by the landowner of the corresponding payment or, in case of rejection
or no response from the landowner, upon the deposit with an accessible bank
designated by the DAR of the compensation in cash or in LBP bonds in accordance
with this Act, the DAR shall take immediate possession of the land and shall request
the proper Register of Deeds to issue a Transfer Certificate of Title (TCT) in the
name of the Republic of the Philippines. The DAR shall thereafter proceed with the
redistribution of the land to the qualified beneficiaries.

Objection is raised, however, to the manner of fixing the just compensation, which it is claimed is
entrusted to the administrative authorities in violation of judicial prerogatives. Specific reference is
made to Section 16(d), which provides that in case of the rejection or disregard by the owner of the
offer of the government to buy his land-

... the DAR shall conduct summary administrative proceedings to determine the
compensation for the land by requiring the landowner, the LBP and other interested
parties to submit evidence as to the just compensation for the land, within fifteen (15)
days from the receipt of the notice. After the expiration of the above period, the
matter is deemed submitted for decision. The DAR shall decide the case within thirty
(30) days after it is submitted for decision.

To be sure, the determination of just compensation is a function addressed to the courts of justice
and may not be usurped by any other branch or official of the government. EPZA v. Dulay resolved 44

a challenge to several decrees promulgated by President Marcos providing that the just
compensation for property under expropriation should be either the assessment of the property by
the government or the sworn valuation thereof by the owner, whichever was lower. In declaring these
decrees unconstitutional, the Court held through Mr. Justice Hugo E. Gutierrez, Jr.:

The method of ascertaining just compensation under the aforecited decrees

constitutes impermissible encroachment on judicial prerogatives. It tends to render
this Court inutile in a matter which under this Constitution is reserved to it for final
determination.

Thus, although in an expropriation proceeding the court technically would still have
the power to determine the just compensation for the property, following the
applicable decrees, its task would be relegated to simply stating the lower value of
the property as declared either by the owner or the assessor. As a necessary
consequence, it would be useless for the court to appoint commissioners under Rule
67 of the Rules of Court. Moreover, the need to satisfy the due process clause in the
taking of private property is seemingly fulfilled since it cannot be said that a judicial
proceeding was not had before the actual taking. However, the strict application of
the decrees during the proceedings would be nothing short of a mere formality or
charade as the court has only to choose between the valuation of the owner and that
of the assessor, and its choice is always limited to the lower of the two. The court
cannot exercise its discretion or independence in determining what is just or fair.
Even a grade school pupil could substitute for the judge insofar as the determination
of constitutional just compensation is concerned.
 xxx

In the present petition, we are once again confronted with the same question of
whether the courts under P.D. No. 1533, which contains the same provision on just
compensation as its predecessor decrees, still have the power and authority to
determine just compensation, independent of what is stated by the decree and to this
effect, to appoint commissioners for such purpose.

This time, we answer in the affirmative.

xxx

It is violative of due process to deny the owner the opportunity to prove that the
valuation in the tax documents is unfair or wrong. And it is repulsive to the basic
concepts of justice and fairness to allow the haphazard work of a minor bureaucrat or
clerk to absolutely prevail over the judgment of a court promulgated only after expert
commissioners have actually viewed the property, after evidence and arguments pro
and con have been presented, and after all factors and considerations essential to a
fair and just determination have been judiciously evaluated.

A reading of the aforecited Section 16(d) will readily show that it does not suffer from the
arbitrariness that rendered the challenged decrees constitutionally objectionable. Although the
proceedings are described as summary, the landowner and other interested parties are nevertheless
allowed an opportunity to submit evidence on the real value of the property. But more importantly,
the determination of the just compensation by the DAR is not by any means final and conclusive
upon the landowner or any other interested party, for Section 16(f) clearly provides:

Any party who disagrees with the decision may bring the matter to the court of proper
jurisdiction for final determination of just compensation.

The determination made by the DAR is only preliminary unless accepted by all parties concerned.
Otherwise, the courts of justice will still have the right to review with finality the said determination in
the exercise of what is admittedly a judicial function.

The second and more serious objection to the provisions on just compensation is not as easily
resolved.

This refers to Section 18 of the CARP Law providing in full as follows:

SEC. 18. Valuation and Mode of Compensation. — The LBP shall compensate the
landowner in such amount as may be agreed upon by the landowner and the DAR
and the LBP, in accordance with the criteria provided for in Sections 16 and 17, and
other pertinent provisions hereof, or as may be finally determined by the court, as the
just compensation for the land.

The compensation shall be paid in one of the following modes, at the option of the
landowner:

(1) Cash payment, under the following terms and conditions:

 (a) For lands above fifty (50) hectares, insofar as the
excess hectarage is concerned — Twenty-five percent
(25%) cash, the balance to be paid in government
financial instruments negotiable at any time.

(b) For lands above twenty-four (24) hectares and up

to fifty (50) hectares — Thirty percent (30%) cash, the
balance to be paid in government financial
instruments negotiable at any time.

(c) For lands twenty-four (24) hectares and below —

Thirty-five percent (35%) cash, the balance to be paid
in government financial instruments negotiable at any
time.

(2) Shares of stock in government-owned or controlled corporations, LBP preferred

shares, physical assets or other qualified investments in accordance with guidelines
set by the PARC;

(3) Tax credits which can be used against any tax liability;

(4) LBP bonds, which shall have the following features:

(a) Market interest rates aligned with 91-day treasury

bill rates. Ten percent (10%) of the face value of the
bonds shall mature every year from the date of
issuance until the tenth (10th) year: Provided, That
should the landowner choose to forego the cash
portion, whether in full or in part, he shall be paid
correspondingly in LBP bonds;

(b) Transferability and negotiability. Such LBP bonds

may be used by the landowner, his successors-in-
interest or his assigns, up to the amount of their face
value, for any of the following:

(i) Acquisition of land or other real properties of the

government, including assets under the Asset
Privatization Program and other assets foreclosed by
government financial institutions in the same province
or region where the lands for which the bonds were
paid are situated;

(ii) Acquisition of shares of stock of government-

owned or controlled corporations or shares of stock
owned by the government in private corporations;

(iii) Substitution for surety or bail bonds for the

provisional release of accused persons, or for
performance bonds;
 (iv) Security for loans with any government financial
institution, provided the proceeds of the loans shall be
invested in an economic enterprise, preferably in a
small and medium- scale industry, in the same
province or region as the land for which the bonds are
paid;

(v) Payment for various taxes and fees to

government: Provided, That the use of these bonds
for these purposes will be limited to a certain
percentage of the outstanding balance of the financial
instruments; Provided, further, That the PARC shall
determine the percentages mentioned above;

(vi) Payment for tuition fees of the immediate family of

the original bondholder in government universities,
colleges, trade schools, and other institutions;

(vii) Payment for fees of the immediate family of the

original bondholder in government hospitals; and

(viii) Such other uses as the PARC may from time to

time allow.

The contention of the petitioners in G.R. No. 79777 is that the above provision is unconstitutional
insofar as it requires the owners of the expropriated properties to accept just compensation therefor
in less than money, which is the only medium of payment allowed. In support of this contention, they
cite jurisprudence holding that:

The fundamental rule in expropriation matters is that the owner of the property
expropriated is entitled to a just compensation, which should be neither more nor
less, whenever it is possible to make the assessment, than the money equivalent of
said property. Just compensation has always been understood to be the just and
complete equivalent of the loss which the owner of the thing expropriated has to
suffer by reason of the expropriation . (Emphasis supplied.)
45

In J.M. Tuazon Co. v. Land Tenure Administration, 46

this Court held:

It is well-settled that just compensation means the equivalent for the value of the
property at the time of its taking. Anything beyond that is more, and anything short of
that is less, than just compensation. It means a fair and full equivalent for the loss
sustained, which is the measure of the indemnity, not whatever gain would accrue to
the expropriating entity. The market value of the land taken is the just compensation
to which the owner of condemned property is entitled, the market value being 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
for such property. (Emphasis supplied.)

In the United States, where much of our jurisprudence on the subject has been derived, the weight
of authority is also to the effect that just compensation for property expropriated is payable only in
money and not otherwise. Thus —
 The medium of payment of compensation is ready money or cash. The condemnor
cannot compel the owner to accept anything but money, nor can the owner compel or
require the condemnor to pay him on any other basis than the value of the property
in money at the time and in the manner prescribed by the Constitution and the
statutes. When the power of eminent domain is resorted to, there must be a standard
medium of payment, binding upon both parties, and the law has fixed that standard
as money in cash. (Emphasis supplied.)
47

Part cash and deferred payments are not and cannot, in the nature of things, be
regarded as a reliable and constant standard of compensation. 48

"Just compensation" for property taken by condemnation means a fair equivalent in

money, which must be paid at least within a reasonable time after the taking, and it is
not within the power of the Legislature to substitute for such payment future
obligations, bonds, or other valuable advantage. (Emphasis supplied.)
49

It cannot be denied from these cases that the traditional medium for the payment of just
compensation is money and no other. And so, conformably, has just compensation been paid in the
past solely in that medium. However, we do not deal here with the traditional excercise of the power
of eminent domain. This is not an ordinary expropriation where only a specific property of relatively
limited area is sought to be taken by the State from its owner for a specific and perhaps local
purpose.

What we deal with here is a revolutionary kind of expropriation.

The expropriation before us affects all private agricultural lands whenever found and of whatever
kind as long as they are in excess of the maximum retention limits allowed their owners. This kind of
expropriation is intended for the benefit not only of a particular community or of a small segment of
the population but of the entire Filipino nation, from all levels of our society, from the impoverished
farmer to the land-glutted owner. Its purpose does not cover only the whole territory of this country
but goes beyond in time to the foreseeable future, which it hopes to secure and edify with the vision
and the sacrifice of the present generation of Filipinos. Generations yet to come are as involved in
this program as we are today, although hopefully only as beneficiaries of a richer and more fulfilling
life we will guarantee to them tomorrow through our thoughtfulness today. And, finally, let it not be
forgotten that it is no less than the Constitution itself that has ordained this revolution in the farms,
calling for "a just distribution" among the farmers of lands that have heretofore been the prison of
their dreams but can now become the key at least to their deliverance.

Such a program will involve not mere millions of pesos. The cost will be tremendous. Considering
the vast areas of land subject to expropriation under the laws before us, we estimate that hundreds
of billions of pesos will be needed, far more indeed than the amount of P50 billion initially
appropriated, which is already staggering as it is by our present standards. Such amount is in fact
not even fully available at this time.

We assume that the framers of the Constitution were aware of this difficulty when they called for
agrarian reform as a top priority project of the government. It is a part of this assumption that when
they envisioned the expropriation that would be needed, they also intended that the just
compensation would have to be paid not in the orthodox way but a less conventional if more
practical method. There can be no doubt that they were aware of the financial limitations of the
government and had no illusions that there would be enough money to pay in cash and in full for the
lands they wanted to be distributed among the farmers. We may therefore assume that their
intention was to allow such manner of payment as is now provided for by the CARP Law, particularly
the payment of the balance (if the owner cannot be paid fully with money), or indeed of the entire
amount of the just compensation, with other things of value. We may also suppose that what they
had in mind was a similar scheme of payment as that prescribed in P.D. No. 27, which was the law in
force at the time they deliberated on the new Charter and with which they presumably agreed in
principle.

The Court has not found in the records of the Constitutional Commission any categorical agreement
among the members regarding the meaning to be given the concept of just compensation as applied
to the comprehensive agrarian reform program being contemplated. There was the suggestion to
"fine tune" the requirement to suit the demands of the project even as it was also felt that they
should "leave it to Congress" to determine how payment should be made to the landowner and
reimbursement required from the farmer-beneficiaries. Such innovations as "progressive
compensation" and "State-subsidized compensation" were also proposed. In the end, however, no
special definition of the just compensation for the lands to be expropriated was reached by the
Commission. 50

On the other hand, there is nothing in the records either that militates against the assumptions we
are making of the general sentiments and intention of the members on the content and manner of
the payment to be made to the landowner in the light of the magnitude of the expenditure and the
limitations of the expropriator.

With these assumptions, the Court hereby declares that the content and manner of the just
compensation provided for in the afore- quoted Section 18 of the CARP Law is not violative of the
Constitution. We do not mind admitting that a certain degree of pragmatism has influenced our
decision on this issue, but after all this Court is not a cloistered institution removed from the realities
and demands of society or oblivious to the need for its enhancement. The Court is as acutely
anxious as the rest of our people to see the goal of agrarian reform achieved at last after the
frustrations and deprivations of our peasant masses during all these disappointing decades. We are
aware that invalidation of the said section will result in the nullification of the entire program, killing
the farmer's hopes even as they approach realization and resurrecting the spectre of discontent and
dissent in the restless countryside. That is not in our view the intention of the Constitution, and that is
not what we shall decree today.

Accepting the theory that payment of the just compensation is not always required to be made fully
in money, we find further that the proportion of cash payment to the other things of value constituting
the total payment, as determined on the basis of the areas of the lands expropriated, is not unduly
oppressive upon the landowner. It is noted that the smaller the land, the bigger the payment in
money, primarily because the small landowner will be needing it more than the big landowners, who
can afford a bigger balance in bonds and other things of value. No less importantly, the government
financial instruments making up the balance of the payment are "negotiable at any time." The other
modes, which are likewise available to the landowner at his option, are also not unreasonable
because payment is made in shares of stock, LBP bonds, other properties or assets, tax credits, and
other things of value equivalent to the amount of just compensation.

Admittedly, the compensation contemplated in the law will cause the landowners, big and small, not
a little inconvenience. As already remarked, this cannot be avoided. Nevertheless, it is devoutly
hoped that these countrymen of ours, conscious as we know they are of the need for their
forebearance and even sacrifice, will not begrudge us their indispensable share in the attainment of
the ideal of agrarian reform. Otherwise, our pursuit of this elusive goal will be like the quest for the
Holy Grail.
The complaint against the effects of non-registration of the land under E.O. No. 229 does not seem
to be viable any more as it appears that Section 4 of the said Order has been superseded by Section
14 of the CARP Law. This repeats the requisites of registration as embodied in the earlier measure
but does not provide, as the latter did, that in case of failure or refusal to register the land, the
valuation thereof shall be that given by the provincial or city assessor for tax purposes. On the
contrary, the CARP Law says that the just compensation shall be ascertained on the basis of the
factors mentioned in its Section 17 and in the manner provided for in Section 16.

The last major challenge to CARP is that the landowner is divested of his property even before
actual payment to him in full of just compensation, in contravention of a well- accepted principle of
eminent domain.

The recognized rule, indeed, is that title to the property expropriated shall pass from the owner to the
expropriator only upon full payment of the just compensation. Jurisprudence on this settled principle
is consistent both here and in other democratic jurisdictions. Thus:

Title to property which is the subject of condemnation proceedings does not vest the condemnor until
the judgment fixing just compensation is entered and paid, but the condemnor's title relates back to
the date on which the petition under the Eminent Domain Act, or the commissioner's report under the
Local Improvement Act, is filed. 51

... although the right to appropriate and use land taken for a canal is complete at the time of entry,
title to the property taken remains in the owner until payment is actually made. (Emphasis
52

supplied.)

In Kennedy v. Indianapolis, the US Supreme Court cited several cases holding that title to property
53

does not pass to the condemnor until just compensation had actually been made. In fact, the
decisions appear to be uniformly to this effect. As early as 1838, in Rubottom v. McLure, it was held
54

that "actual payment to the owner of the condemned property was a condition precedent to the
investment of the title to the property in the State" albeit "not to the appropriation of it to public use."
In Rexford v. Knight, the Court of Appeals of New York said that the construction upon the statutes
55

was that the fee did not vest in the State until the payment of the compensation although the
authority to enter upon and appropriate the land was complete prior to the payment. Kennedy further
said that "both on principle and authority the rule is ... that the right to enter on and use the property
is complete, as soon as the property is actually appropriated under the authority of law for a public
use, but that the title does not pass from the owner without his consent, until just compensation has
been made to him."

Our own Supreme Court has held in Visayan Refining Co. v. Camus and Paredes, that: 56

If the laws which we have exhibited or cited in the preceding discussion are
attentively examined it will be apparent that the method of expropriation adopted in
this jurisdiction is such as to afford absolute reassurance that no piece of land can
be finally and irrevocably taken from an unwilling owner until compensation is paid ...
. (Emphasis supplied.)

It is true that P.D. No. 27 expressly ordered the emancipation of tenant-farmer as October 21, 1972
and declared that he shall "be deemed the owner" of a portion of land consisting of a family-sized
farm except that "no title to the land owned by him was to be actually issued to him unless and until
he had become a full-fledged member of a duly recognized farmers' cooperative." It was understood,
however, that full payment of the just compensation also had to be made first, conformably to the
constitutional requirement.
When E.O. No. 228, categorically stated in its Section 1 that:

All qualified farmer-beneficiaries are now deemed full owners as of October 21, 1972
of the land they acquired by virtue of Presidential Decree No. 27. (Emphasis
supplied.)

it was obviously referring to lands already validly acquired under the said decree, after proof of full-
fledged membership in the farmers' cooperatives and full payment of just compensation. Hence, it
was also perfectly proper for the Order to also provide in its Section 2 that the "lease rentals paid to
the landowner by the farmer- beneficiary after October 21, 1972 (pending transfer of ownership after
full payment of just compensation), shall be considered as advance payment for the land."

The CARP Law, for its part, conditions the transfer of possession and ownership of the land to the
government on receipt by the landowner of the corresponding payment or the deposit by the DAR of
the compensation in cash or LBP bonds with an accessible bank. Until then, title also remains with
the landowner. No outright change of ownership is contemplated either.
57

Hence, the argument that the assailed measures violate due process by arbitrarily transferring title
before the land is fully paid for must also be rejected.

It is worth stressing at this point that all rights acquired by the tenant-farmer under P.D. No. 27, as
recognized under E.O. No. 228, are retained by him even now under R.A. No. 6657. This should
counter-balance the express provision in Section 6 of the said law that "the landowners whose lands
have been covered by Presidential Decree No. 27 shall be allowed to keep the area originally
retained by them thereunder, further, That original homestead grantees or direct compulsory heirs
who still own the original homestead at the time of the approval of this Act shall retain the same
areas as long as they continue to cultivate said homestead."

In connection with these retained rights, it does not appear in G.R. No. 78742 that the appeal filed by
the petitioners with the Office of the President has already been resolved. Although we have said
that the doctrine of exhaustion of administrative remedies need not preclude immediate resort to
judicial action, there are factual issues that have yet to be examined on the administrative level,
especially the claim that the petitioners are not covered by LOI 474 because they do not own other
agricultural lands than the subjects of their petition.

Obviously, the Court cannot resolve these issues. In any event, assuming that the petitioners have
not yet exercised their retention rights, if any, under P.D. No. 27, the Court holds that they are
entitled to the new retention rights provided for by R.A. No. 6657, which in fact are on the whole
more liberal than those granted by the decree.

The CARP Law and the other enactments also involved in these cases have been the subject of
bitter attack from those who point to the shortcomings of these measures and ask that they be
scrapped entirely. To be sure, these enactments are less than perfect; indeed, they should be
continuously re-examined and rehoned, that they may be sharper instruments for the better
protection of the farmer's rights. But we have to start somewhere. In the pursuit of agrarian reform,
we do not tread on familiar ground but grope on terrain fraught with pitfalls and expected difficulties.
This is inevitable. The CARP Law is not a tried and tested project. On the contrary, to use Justice
Holmes's words, "it is an experiment, as all life is an experiment," and so we learn as we venture
forward, and, if necessary, by our own mistakes. We cannot expect perfection although we should
strive for it by all means. Meantime, we struggle as best we can in freeing the farmer from the iron
shackles that have unconscionably, and for so long, fettered his soul to the soil.

By the decision we reach today, all major legal obstacles to the comprehensive agrarian reform
program are removed, to clear the way for the true freedom of the farmer. We may now glimpse the
day he will be released not only from want but also from the exploitation and disdain of the past and
from his own feelings of inadequacy and helplessness. At last his servitude will be ended forever. At
last the farm on which he toils will be his farm. It will be his portion of the Mother Earth that will give
him not only the staff of life but also the joy of living. And where once it bred for him only deep
despair, now can he see in it the fruition of his hopes for a more fulfilling future. Now at last can he
banish from his small plot of earth his insecurities and dark resentments and "rebuild in it the music
and the dream."

WHEREFORE, the Court holds as follows:

1. R.A. No. 6657, P.D. No. 27, Proc. No. 131, and E.O. Nos. 228 and 229 are
SUSTAINED against all the constitutional objections raised in the herein petitions.

2. Title to all expropriated properties shall be transferred to the State only upon full
payment of compensation to their respective owners.

3. All rights previously acquired by the tenant- farmers under P.D. No. 27 are retained
and recognized.

4. Landowners who were unable to exercise their rights of retention under P.D. No.
27 shall enjoy the retention rights granted by R.A. No. 6657 under the conditions
therein prescribed.

5. Subject to the above-mentioned rulings all the petitions are DISMISSED, without
pronouncement as to costs.

SO ORDERED.

Fernan, (C.J.), Narvasa, Melencio-Herrera, Gutierrez, Jr., Paras, Feliciano, Gancayco, Padilla, Bidin,
Sarmiento, Cortes, Griño-Aquino, Medialdea and Regalado, JJ., concur.

PHILIPPINE PRESS INSTITUTE VS. COMELEC [244

SCRA 272; G.R. No. 119694; 22 May 1995]
Saturday, January 31, 2009 Posted by Coffeeholic Writes
Labels: Case Digests, Political Law

Facts: Respondent Comelec promulgated Resolution No. 2772 directing

newspapers to provide free Comelec space of not less than one-half page for
the common use of political parties and candidates. The Comelec space shall be
allocated by the Commission, free of charge, among all candidates to enable
them to make known their qualifications, their stand on public Issue and their
platforms of government. The Comelec space shall also be used by the
Commission for dissemination of vital election information.

Petitioner Philippine Press Institute, Inc. (PPI), a non-profit organization of

newspaper and magazine publishers, asks the Supreme Court to declare
Comelec Resolution No. 2772 unconstitutional and void on the ground that it
violates the prohibition imposed by the Constitution upon the government
against the taking of private property for public use without just compensation.
On behalf of the respondent Comelec, the Solicitor General claimed that the
Resolution is a permissible exercise of the power of supervision (police power)
of the Comelec over the information operations of print media enterprises
during the election period to safeguard and ensure a fair, impartial and credible
election.

Issue:

Whether or not Comelec Resolution No. 2772 is unconstitutional.

Held: The Supreme Court declared the Resolution as unconstitutional. It held

that to compel print media companies to donate “Comelec space ” amounts to
“taking” of private personal property without payment of the just compensation
required in expropriation cases. Moreover, the element of necessity for the
taking has not been established by respondent Comelec, considering that the
newspapers were not unwilling to sell advertising space. The taking of private
property for public use is authorized by the constitution, but not without
payment of just compensation. Also Resolution No. 2772 does not constitute a
valid exercise of the police power of the state. In the case at bench, there is no
showing of existence of a national emergency to take private property of
newspaper or magazine publishers.
G.R. No. L-119694 May 22, 1995

PHILIPPINE PRESS INSTITUTE, INC., for and in behalf of 139 members, represented by its
President, Amado P. Macasaet and its Executive Director Ermin F. Garcia, Jr., petitioner,
vs.
COMMISSION ON ELECTIONS, respondent.

RESOLUTION

FELICIANO, J.:

The Philippine Press Institute, Inc. ("PPI") is before this Court assailing the constitutional validity of
Resolution No. 2772 issued by respondent Commission on Elections ("Comelec") and its
corresponding Comelec directive dated 22 March 1995, through a Petition for Certiorari and
Prohibition. Petitioner PPI is a non-stock, non-profit organization of newspaper and magazine
publishers.

On 2 March 1995, Comelec promulgated Resolution No. 2772, which reads in part:

xxx xxx xxx

Sec. 2. Comelec Space. — The Commission shall procure free print space of not
less than one half (1/2) page in at least one newspaper of general circulation in
every province or city for use as "Comelec Space" from March 6, 1995 in the case of
candidates for senator and from March 21, 1995 until May 12, 1995. In the absence
of said newspaper, "Comelec Space" shall be obtained from any magazine or
periodical of said province or city.

Sec. 3. Uses of Comelec Space. — "Comelec Space" shall be allocated by the

Commission, free of charge, among all candidates within the area in which the
newspaper, magazine or periodical is circulated to enable the candidates to make
known their qualifications, their stand on public issues and their platforms and
programs of government.

"Comelec Space" shall also be used by the Commission for dissemination of vital
election information.

Sec. 4. Allocation of Comelec Space. — (a) "Comelec Space" shall also be available
to all candidates during the periods stated in Section 2 hereof. Its allocation shall be
equal and impartial among all candidates for the same office. All candidates
concerned shall be furnished a copy of the allocation of "Comelec Space" for their
information, guidance and compliance.

(b) Any candidate desiring to avail himself of "Comelec Space" from newspapers or
publications based in the Metropolitan Manila Area shall submit an application
 therefor, in writing, to the Committee on Mass Media of the Commission. Any
candidate desiring to avail himself of "Comelec Space" in newspapers or publications
based in the provinces shall submit his application therefor, in writing, to the
Provincial Election Supervisor concerned. Applications for availment of "Comelec
Space" maybe filed at any time from the date of effectivity of this Resolution.

(c) The Committee on Mass Media and the Provincial Election Supervisors
shall allocate available "Comelec Space" among the candidates concerned by
lottery of which said candidates shall be notified in advance, in writing, to be present
personally or by representative to witness the lottery at the date, time and place
specified in the notice. Any party objecting to the result of the lottery may appeal to
the Commission.

(d) The candidates concerned shall be notified by the Committee on Mass Media or
the Provincial Election Supervisor, as the case maybe, sufficiently in advance and in
writing of the date of issue and the newspaper or publication allocated to him, and
the time within which he must submit the written material for publication in the
"Comelec Space".

xxx xxx xxx

Sec. 8. Undue Reference to Candidates/Political Parties in Newspapers. — No

newspaper or publication shall allow to be printed or published in the news, opinion,
features, or other sections of the newspaper or publication accounts or comments
which manifestly favor or oppose any candidate or political party by unduly or
repeatedly referring to or including therein said candidate or political party. However,
unless the facts and circumstances clearly indicate otherwise, the Commission will
respect the determination by the publisher and/or editors of the newspapers or
publications that the accounts or views published are significant, newsworthy and of
public interest. (Emphasis supplied)

Apparently in implementation of this Resolution, Comelec through Commissioner Regalado E.

Maambong sent identical letters, dated 22 March 1995, to various publishers of newspapers like
the Business World, the Philippine Star, the Malaya and the Philippine Times Journal, all members
of PPI. These letters read as follows:

This is to advise you that pursuant to Resolution No. 2772 of the Commission on
Elections, you are directed to provide free print space of not less than one half (1/2)
page for use as "Comelec Space" or similar to the print support which you have
extended during the May 11, 1992 synchronized elections which was 2 full pages for
each political party fielding senatorial candidates, from March 6, 1995 to May 6,
1995, to make known their qualifications, their stand on public issues and their
platforms and programs of government.

We shall be informing the political parties and candidates to submit directly to

you their pictures, biographical data, stand on key public issues and platforms of
government either as raw data or in the form of positives or camera-ready materials.

Please be reminded that the political parties/candidates may be accommodated in

your publication any day upon receipt of their materials until May 6, 1995 which is the
last day for campaigning.
 We trust you to extend your full support and cooperation in this regard. (Emphasis
supplied)

In this Petition for Certiorari and Prohibition with prayer for the issuance of a Temporary Restraining
Order, PPI asks us to declare Comelec Resolution No. 2772 unconstitutional and void on the ground
that it violates the prohibition imposed by the Constitution upon the government, and any of its
agencies, against the taking of private property for public use without just compensation. Petitioner
also contends that the 22 March 1995 letter directives of Comelec requiring publishers to give free
"Comelec Space" and at the same time process raw data to make it camera-ready, constitute
impositions of involuntary servitude, contrary to the provisions of Section 18 (2), Article III of the
1987 Constitution. Finally, PPI argues that Section 8 of Comelec Resolution No. 2772 is violative of
the constitutionally guaranteed freedom of speech, of the press and of expression. 1

On 20 April 1995, this Court issued a Temporary Restraining Order enjoining Comelec from
enforcing and implementing Section 2 of Resolution No. 2772, as well as the Comelec directives
addressed to various print media enterprises all dated 22 March 1995. The Court also required the
respondent to file a Comment on the Petition.

The Office of the Solicitor General filed its Comment on behalf of respondent Comelec alleging that
Comelec Resolution No. 2772 does not impose upon the publishers any obligation to provide free
print space in the newspapers as it does not provide any criminal or administrative sanction for non-
compliance with that Resolution. According to the Solicitor General, the questioned Resolution
merely established guidelines to be followed in connection with the procurement of "Comelec
space," the procedure for and mode of allocation of such space to candidates and the conditions or
requirements for the candidate's utilization of the "Comelec space" procured. At the same time,
however, the Solicitor General argues that even if the questioned Resolution and its implementing
letter directives are viewed as mandatory, the same would nevertheless be valid as an exercise of
the police power of the State. The Solicitor General also maintains that Section 8 of Resolution No.
2772 is a permissible exercise of the power of supervision or regulation of the Comelec over the
communication and information operations of print media enterprises during the election period to
safeguard and ensure a fair, impartial and credible election.2

At the oral hearing of this case held on 28 April 1995, respondent Comelec through its Chairman,
Hon. Bernardo Pardo, in response to inquiries from the Chief Justice and other Members of the
Court, stated that Resolution No. 2772, particularly Section 2 thereof and the 22 March 1995 letters
dispatched to various members of petitioner PPI, were not intended to compel those members to
supply Comelec with free print space. Chairman Pardo represented to the Court that Resolution and
the related letter-directives were merely designed to solicit from the publishers the same free print
space which many publishers had voluntarily given to Comelec during the election period relating to
the 11 May 1992 elections. Indeed, the Chairman stated that the Comelec would, that very
afternoon, meet and adopt an appropriate amending or clarifying resolution, a certified true copy of
which would forthwith be filed with the Court.

On 5 May 1995, the Court received from the Office of the Solicitor General a manifestation which
attached a copy of Comelec Resolution No. 2772-A dated 4 May 1995. The operative portion of this
Resolution follows:

NOW THEREFORE, pursuant to the powers vested in it by the Constitution, the

Omnibus Election Code, Republic Acts No. 6646 and 7166 and other election laws,
the Commission on Elections RESOLVED to clarify Sections 2 and 8 of Res. No.
2772 as follows:
 1. Section 2 of Res. No. 2772 shall not be construed
to mean as requiring publishers of the different mass
media print publications to provide print space under
pain of prosecution, whether administrative, civil or
criminal, there being no sanction or penalty for
violation of said Section provided for either in said
Resolution or in Section 90 of Batas Pambansa Blg.
881, otherwise known as the Omnibus Election Code,
on the grant of "Comelec space."

2. Section 8 of Res. No. 2772 shall not be construed

to mean as constituting prior restraint on the part of
publishers with respect to the printing or publication of
materials in the news, opinion, features or other
sections of their respective publications or other
accounts or comments, it being clear from the last
sentence of said Section 8 that the Commission shall,
"unless the facts and circumstances clearly indicate
otherwise . . . respect the determination by the
publisher and/or editors of the newspapers or
publications that the accounts or views published are
significant, newsworthy and of public interest."

This Resolution shall take effect upon approval. (Emphasis in the original)

While, at this point, the Court could perhaps simply dismiss the Petition for Certiorari and Prohibition
as having become moot and academic, we consider it not inappropriate to pass upon the first
constitutional issue raised in this case. Our hope is to put this issue to rest and prevent its
resurrection.

Section 2 of Resolution No. 2772 is not a model of clarity in expression. Section 1 of Resolution No.
2772-A did not try to redraft Section 2; accordingly, Section 2 of Resolution No. 2772 persists in its
original form. Thus, we must point out that, as presently worded, and in particular as interpreted and
applied by the Comelec itself in its 22 March 1995 letter-directives to newspaper publishers, Section
2 of Resolution No. 2772 is clearly susceptible of the reading that petitioner PPI has given it. That
Resolution No. 2772 does not, in express terms, threaten publishers who would disregard it or its
implementing letters with some criminal or other sanction, does not by itself demonstrate that the
Comelec's original intention was simply to solicit or request voluntary donations of print space from
publishers. A written communication officially directing a print media company to supply free print
space, dispatched by a government (here a constitutional) agency and signed by a member of the
Commission presumably legally authorized to do so, is bound to produce a coercive effect upon the
company so addressed. That the agency may not be legally authorized to impose, or cause the
imposition of, criminal or other sanctions for disregard of such directions, only aggravates the
constitutional difficulties inhearing in the present situation. The enactment or addition of such
sanctions by the legislative authority itself would be open to serious constitutional objection.

To compel print media companies to donate "Comelec-space" of the dimensions specified in Section
2 of Resolution No. 2772 (not less than one-half page), amounts to "taking" of private personal
property for public use or purposes. Section 2 failed to specify the intended frequency of such
compulsory "donation:" only once during the period from 6 March 1995 (or 21 March 1995) until 12
May 1995? or everyday or once a week? or as often as Comelec may direct during the same
period? The extent of the taking or deprivation is not insubstantial; this is not a case of a de
minimistemporary limitation or restraint upon the use of private property. The monetary value of the
compulsory "donation," measured by the advertising rates ordinarily charged by newspaper
publishers whether in cities or in non-urban areas, may be very substantial indeed.

The taking of print space here sought to be effected may first be appraised under the rubric of
expropriation of private personal property for public use. The threshold requisites for a lawful taking
of private property for public use need to be examined here: one is the necessity for the taking;
another is the legal authority to effect the taking. The element of necessity for the taking has not
been shown by respondent Comelec. It has not been suggested that the members of PPI are
unwilling to sell print space at their normal rates to Comelec for election purposes. Indeed, the
unwillingness or reluctance of Comelec to buy print space lies at the heart of the problem. Similarly,
3

it has not been suggested, let alone demonstrated, that Comelec has been granted the power of
eminent domain either by the Constitution or by the legislative authority. A reasonable relationship
between that power and the enforcement and administration of election laws by Comelec must be
shown; it is not casually to be assumed.

That the taking is designed to subserve "public use" is not contested by petitioner PPI. We note only
that, under Section 3 of Resolution No. 2772, the free "Comelec space" sought by the respondent
Commission would be used not only for informing the public about the identities, qualifications and
programs of government of candidates for elective office but also for "dissemination of vital election
information" (including, presumably, circulars, regulations, notices, directives, etc. issued by
Comelec). It seems to the Court a matter of judicial notice that government offices and agencies
(including the Supreme Court) simply purchase print space, in the ordinary course of events, when
their rules and regulations, circulars, notices and so forth need officially to be brought to the attention
of the general public.

The taking of private property for public use is, of course, authorized by the Constitution, but not
without payment of "just compensation" (Article III, Section 9). And apparently the necessity of
paying compensation for "Comelec space" is precisely what is sought to be avoided by respondent
Commission, whether Section 2 of Resolution No. 2772 is read as petitioner PPI reads it, as an
assertion of authority to require newspaper publishers to "donate" free print space for Comelec
purposes, or as an exhortation, or perhaps an appeal, to publishers to donate free print space, as
Section 1 of Resolution No. 2772-A attempts to suggest. There is nothing at all to prevent
newspaper and magazine publishers from voluntarily giving free print space to Comelec for the
purposes contemplated in Resolution No. 2772. Section 2 of Resolution No. 2772 does not,
however, provide a constitutional basis for compelling publishers, against their will, in the kind of
factual context here present, to provide free print space for Comelec purposes. Section 2 does not
constitute a valid exercise of the power of eminent domain.

We would note that the ruling here laid down by the Court is entirely in line with the theory of
democratic representative government. The economic costs of informing the general public about
the qualifications and programs of those seeking elective office are most appropriately distributed as
widely as possible throughout our society by the utilization of public funds, especially funds raised by
taxation, rather than cast solely on one small sector of society, i.e., print media enterprises. The
benefits which flow from a heightened level of information on and the awareness of the electoral
process are commonly thought to be community-wide; the burdens should be allocated on the same
basis.

As earlier noted, the Solicitor General also contended that Section 2 of Resolution No. 2772, even if
read as compelling publishers to "donate" "Comelec space, " may be sustained as a valid exercise of
the police power of the state. This argument was, however, made too casually to require prolonged
consideration on our part. Firstly, there was no effort (and apparently no inclination on the part of
Comelec) to show that the police power — essentially a power of legislation — has been
constitutionally delegated to respondent Commission. Secondly, while private property may indeed
4

be validly taken in the legitimate exercise of the police power of the state, there was no attempt to
show compliance in the instant case with the requisites of a lawful taking under the police power. 5

Section 2 of Resolution No. 2772 is a blunt and heavy instrument that purports, without a showing of
existence of a national emergency or other imperious public necessity, indiscriminately and without
regard to the individual business condition of particular newspapers or magazines located in differing
parts of the country, to take private property of newspaper or magazine publishers. No attempt was
made to demonstrate that a real and palpable or urgent necessity for the taking of print space
confronted the Comelec and that Section 2 of Resolution No. 2772 was itself the only reasonable
and calibrated response to such necessity available to the Comelec. Section 2 does not constitute a
valid exercise of the police power of the State.

We turn to Section 8 of Resolution No. 2772, which needs to be quoted in full again:

Sec. 8. Undue Reference to Candidates/Political Parties in Newspapers. — No

newspaper or publication shall allow to be printed or published in the news, opinion,
features, or other sections of the newspaper or publication accounts or comments
which manifestly favor or oppose any candidate or political party by unduly or
repeatedly referring to or including therein said candidate or political party. However,
unless the facts and circumstances clearly indicate otherwise, the Commission will
respect the determination by the publisher and/or editors of the newspapers or
publications that the accounts or views published are significant, newsworthy and of
public interest.

It is not easy to understand why Section 8 was included at all in Resolution No. 2772. In any case,
Section 8 should be viewed in the context of our decision in National Press Club v. Commission on
Elections. There the Court sustained the constitutionality of Section 11 (b) of R.A. No. 6646, known
6

as the Electoral Reforms Law of 1987, which prohibits the sale or donation of print space and airtime
for campaign or other political purposes, except to the Comelec. In doing so, the Court carefully
distinguished (a) paid political advertisements which are reached by the prohibition of Section 11 (b),
from (b) the reporting of news, commentaries and expressions of belief or opinion by reporters,
broadcasters, editors, commentators or columnists which fall outside the scope of Section 11 (b) and
which are protected by the constitutional guarantees of freedom of speech and of the press:

Secondly, and more importantly, Section 11 (b) is limited in its scope of application.
Analysis of Section 11 (b) shows that it purports to apply only to the purchase and
sale, including purchase and sale disguised as a donation, of print space and air
time for campaign or other political purposes. Section 11 (b) does not purport in any
way to restrict the reporting by newspapers or radio or television stations of news or
news-worthy events relating to candidates, their qualifications, political parties and
programs of government. Moreover, Section 11 (b) does not reach commentaries
and expressions of belief or opinion by reporters or broadcaster or editors or
commentators or columnists in respect of candidates, their qualifications, and
programs and so forth, so long at least as such comments, opinions and beliefs are
not in fact advertisements for particular candidates covertly paid for. In sum, Section
11 (b) is not to be read as reaching any report or commentary or other coverage that,
in responsible media, is not paid for by candidates for political office. We read
Section 11 (b) as designed to cover only paid political advertisements of particular
candidates.
 The above limitation in scope of application of Section 11 (b) — that it does not
restrict either the reporting of or the expression of belief or opinion or comment upon
the qualifications and programs and activities of any and all candidates for office —
constitutes the critical distinction which must be made between the instant case and
that of Sanidad v. Commission on Elections. . . . (Citations omitted; emphasis
7

supplied)

Section 8 of Resolution No. 2772 appears to represent the effort of the Comelec to establish a
guideline for implementation of the above-quoted distinction and doctrine in National Press Club an
effort not blessed with evident success. Section 2 of Resolution No. 2772-A while possibly helpful,
does not add substantially to the utility of Section 8 of Resolution No. 2772. The distinction between
paid political advertisements on the one hand and news reports, commentaries and expressions of
belief or opinion by reporters, broadcasters, editors, etc. on the other hand, can realistically be given
operative meaning only in actual cases or controversies, on a case-to-case basis, in terms of very
specific sets of facts.

At all events, the Court is bound to note that PPI has failed to allege any specific affirmative action
on the part of Comelec designed to enforce or implement Section 8. PPI has not claimed that it or
any of its members has sustained actual or imminent injury by reason of Comelec action under
Section 8. Put a little differently, the Court considers that the precise constitutional issue here sought
to be raised — whether or not Section 8 of Resolution No. 2772 constitutes a permissible exercise of
the Comelec's power under Article IX, Section 4 of the Constitution to

supervise or regulate the enjoyment or utilization of all franchise or permits for the
operation of — media of communication or information — [for the purpose of
ensuring] equal opportunity, time and space, and the right of reply, including
reasonable, equal rates therefore, for public information campaigns and forums
among candidates in connection with the objective of holding free, orderly honest,
peaceful and credible elections —

is not ripe for judicial review for lack of an actual case or controversy involving, as the very lis
mota thereof, the constitutionality of Section 8.

Summarizing our conclusions:

1. Section 2 of Resolution No. 2772, in its present form and as interpreted by Comelec in its 22
March 1995 letter directives, purports to require print media enterprises to "donate" free print space
to Comelec. As such, Section 2 suffers from a fatal constitutional vice and must be set aside and
nullified.

2. To the extent it pertains to Section 8 of Resolution No. 2772, the Petition for Certiorari and
Prohibition must be dismissed for lack of an actual, justiciable case or controversy.

WHEREFORE, for all the foregoing, the Petition for Certiorari and Prohibition is GRANTED in part
and Section 2 of Resolution No. 2772 in its present form and the related letter-directives dated 22
March 1995 are hereby SET ASIDE as null and void, and the Temporary Restraining Order is hereby
MADE PERMANENT. The Petition is DISMISSED in part, to the extent it relates to Section 8 of
Resolution No. 2772. No pronouncement as to costs.

Narvasa, C.J., Padilla, Regalado, Davide, Jr., Romero, Bellosillo, Melo, Puno, Vitug, Kapunan,
Mendoza and Francisco, JJ., concur.
Quiason, J., is on leave.

Footnotes

1 Petition, pp. 6-11; Rollo, pp. 7-12.

2 Comment, pp. 5-15; Rollo, pp. 70-80.

3 As I.A. Cruz, Constitutional Law, p. 59 (1991 ed.), citing Noble v. City of Manila, 67
Phil. 1 (1938), stressed:

[w]here private properties needed for conversion to some public use, the first thing
obviously that the government should do is to offer to buy it. If the owner is willing to
sell and the parties can agree on the price and the other conditions of the sale, a
voluntary transaction can then be concluded and the transfer effected without the
necessity of judicial action.

But if the owner of the private property is unwilling to part with it, or, being
willing, cannot agree to the conditions of the transfer, then it will be necessary for the
government to use its coercive authority. By its power of eminent domain, it can then,
upon payment of just compensation, forcibly acquire the needed property in order to
devote it to the intended public use. (Emphases supplied)

4 See, in this connection, Cruz, surpra note 3 at pp. 44-45. The police power may be
delegated by the legislative authority to local governments under the general welfare
clause (Section 16, R.A. No. 7160, "Local Government Code of 1991"), to the
President and administrative agencies. See also Binay v. Domingo, 201 SCRA 508
(1991); Philippine Association of Service Exporters, Inc. v. Drilon, 163 SCRA 386
(1988); Villacosta v. Bernardo, 143 SCRA 480 (1986).

5 See National Development Company v. Philippine Veterans Bank, 192 SCRA 257
(1990); Association of Small Landowners in the Philippines, Inc. v. Secretary of
Agrarian Reform, 175 SCRA 343 (1989).

6 207 SCRA 1 (1992).

7 207 SCRA at 10-11.