Manila International Airport Authority vs Court of Appeals

GR No. 155650,July 20, 2006, 495 SCRA 591

Facts:
Manila International Airport Authority (MIAA) is the operator of the Ninoy
Aquino International Airport located at Paraaque City. The Officers at Paraaque
City sent notices to MIAA due to real estate tax delinquency. MIAA then settled some
of the amount. When MIAA failed to settle the entire amount, the officers Paraaque
City threatened to levy and subject to auction the land and buildings of MIAA which
they did. MIAA sought for a Temporary Restraining Order from the CA but failed to
do so within the 60 days reglementary period, so the petition was dismissed. MIAA
then sought for the TRO but unfortunately the TRO was received by the Paraaque
City officers 3 hours after the public auction.
MIAA claims that although the charter provides that the title of the land and
building are with MIAA still the ownership is with the Republic of the Philippines.
MIAA also contends that it is an instrumentality of the government and as such
exempted from real estate tax. That the land and buildings land, the officers of
Paraaque City claim that MIAA is a government owned and controlled corporation
therefore not exempted to real estate tax.
ISSUES:
Whether or not MIAA is an instrumentality of the government and not the
government owned and controlled corporation and as such exempted from tax.
Whether or not the land and buildings of MIAA are part of the public dominion
and thus cannot be the subject of levy and auction sale.
RULLINGS:
Under the local government code, government owned and controlled
corporations are not exempted from real estate tax. MIAA is not a government
owned and controlled corporations, for to become one MIAA should either be a stock
or non stock corporation. MIAA is not a non stock corporations for its capital is not
divided into shares. It is not a non stock corporation since it has no members. MIAA
is an instrumentality of the government vested with corporate powers and
government functions.
Under the civil code, property may either be under public dominion or private
ownership.Those under public dominion are owned by the State and are utilitized for
public use., public service and for the development of national wealth. The ports
included in the public dominion pertain either to seaports or airports. When
properties under public dominion cease to be for public use and services, they form
part of the patrimonial property of the State.
The court held that the land and buildings are part of the public dominion.
Since the airport is devoted for public use, for the domestic and international travel
and transportation. Even if MIAA charge fees, this is for the support for its operation
and for regulation and does not change the character of the land and buildings of
MIAA as part of public dominion. As part of public dominion the land and buildings of
MIAA are outside the commerce of man. To subject them so levy and public auction

is contrary to public policy. Unless the President issues a proclamation widrawing

the airport land and buildings from public use, these properties remain to be of
public dominion and are inalienable. As long as the land and buildings are for the
public use the ownership is with the Republic of the Philippines. Case dismissed.