G.R. No. 81958 June 30, 1988
1 is in
PHILIPPINE ASSOCIATION OF SERVICE
EXPORTERS, INC., petitioner,
vs.
HON. FRANKLIN M. DRILON as Secretary of
Labor and Employment, and TOMAS D.
ACHACOSO, as Administrator of the Philippine
Overseas Employment
Administration, respondents.
SARMIENTO, J.:
The petitioner, Philippine Association of Service
Exporters, Inc. (PASEI, for short), a firm "engaged
principally in the recruitment of Filipino workers,
male and female, for overseas
placement," 1 challenges the Constitutional validity
of Department Order No. 1, Series of 1988, of the
Department of Labor and Employment, in the
character of "GUIDELINES GOVERNING THE
TEMPORARY SUSPENSION OF DEPLOYMENT OF
FILIPINO DOMESTIC AND HOUSEHOLD
WORKERS," in this petition for certiorari and
prohibition. Specifically, the measure is assailed
for "discrimination against males or females;" 2 that
it "does not apply to all Filipino workers but only to
domestic helpers and females with similar
skills;" 3 and that it is violative of the right to
travel. It is held likewise to be an invalid exercise of
the lawmaking power, police power being
legislative, and not executive, in character.
In its supplement to the petition, PASEI invokes
Section 3, of Article XIII, of the Constitution,
providing for worker participation "in policy and
decision-making processes affecting their rights
and benefits as may be provided by
law." 4 Department Order No. 1, it is contended,
was passed in the absence of prior consultations. It
is claimed, finally, to be in violation of the
Charter's non-impairment clause, in addition to
the "great and irreparable injury" that PASEI
members face should the Order be further
enforced.
On May 25, 1988, the Solicitor General, on behalf
of the respondents Secretary of Labor and
Administrator of the Philippine Overseas
Employment Administration, filed a Comment
informing the Court that on March 8, 1988, the
respondent Labor Secretary lifted the deployment
ban in the states of Iraq, Jordan, Qatar, Canada,
Hongkong, United States, Italy, Norway, Austria,
and Switzerland. * In submitting the validity of the
challenged "guidelines," the Solicitor General
invokes the police power of the Philippine State.
It is admitted that Department Order No.
the nature of a police power measure. The only
question is whether or not it is valid under the
Constitution.
The concept of police power is well-established in
this jurisdiction. It has been defined as the "state
authority to enact legislation that may interfere
with personal liberty or property in order to
promote the general welfare." 5 As defined, it
consists of (1) an imposition of restraint upon
liberty or property, (2) in order to foster the
common good. It is not capable of an exact
definition but has been, purposely, veiled in
general terms to underscore its all-comprehensive
embrace.
"Its scope, ever-expanding to meet the exigencies of
the times, even to anticipate the future where it
could be done, provides enough room for an
efficient and flexible response to conditions and
circumstances thus assuring the greatest
benefits." 6
It finds no specific Constitutional grant for the
plain reason that it does not owe its origin to the
Charter. Along with the taxing power and eminent
domain, it is inborn in the very fact of statehood
and sovereignty. It is a fundamental attribute of
government that has enabled it to perform the
most vital functions of governance. Marshall, to
whom the expression has been credited, 7 refers to
it succinctly as the plenary power of the State "to
govern its citizens." 8
"The police power of the State ... is a power
coextensive with self- protection, and it is not
inaptly termed the "law of overwhelming necessity."
It may be said to be that inherent and plenary
power in the State which enables it to prohibit all
things hurtful to the comfort, safety, and welfare of
society." 9
It constitutes an implied limitation on the Bill of
Rights. According to Fernando, it is "rooted in the
conception that men in organizing the state and
imposing upon its government limitations to
safeguard constitutional rights did not intend
thereby to enable an individual citizen or a group
of citizens to obstruct unreasonably the enactment
of such salutary measures calculated to ensure
communal peace, safety, good order, and
welfare." 10 Significantly, the Bill of Rights itself
does not purport to be an absolute guaranty of
individual rights and liberties "Even liberty itself,
the greatest of all rights, is not unrestricted license
to act according to one's will." 11 It is subject to the
far more overriding demands and requirements of
the greater number.
Notwithstanding its extensive sweep, police power
is not without its own limitations. For all its
awesome consequences, it may not be exercised
arbitrarily or unreasonably. Otherwise, and in that
event, it defeats the purpose for which it is
exercised, that is, to advance the public good.
Thus, when the power is used to further private
interests at the expense of the citizenry, there is a
clear misuse of the power. 12
In the light of the foregoing, the petition must be
dismissed.
As a general rule, official acts enjoy a presumed
vahdity. 13 In the absence of clear and convincing
evidence to the contrary, the presumption logically
stands.
The petitioner has shown no satisfactory reason
why the contested measure should be nullified.
There is no question that Department Order No. 1
applies only to "female contract workers," 14 but it
does not thereby make an undue discrimination
between the sexes. It is well-settled that "equality
before the law" under the Constitution 15does not
import a perfect Identity of rights among all men
and women. It admits of classifications, provided
that (1) such classifications rest on substantial
distinctions; (2) they are germane to the purposes
of the law; (3) they are not confined to existing
conditions; and (4) they apply equally to all
members of the same class. 16
The Court is satisfied that the classification made-
the preference for female workers — rests on
substantial distinctions.
As a matter of judicial notice, the Court is well
aware of the unhappy plight that has befallen our
female labor force abroad, especially domestic
servants, amid exploitative working conditions
marked by, in not a few cases, physical and
personal abuse. The sordid tales of maltreatment
suffered by migrant Filipina workers, even rape
and various forms of torture, confirmed by
testimonies of returning workers, are compelling
motives for urgent Government action. As precisely
the caretaker of Constitutional rights, the Court is
called upon to protect victims of exploitation. In
fulfilling that duty, the Court sustains the
Government's efforts.
The same, however, cannot be said of our male
workers. In the first place, there is no evidence
that, except perhaps for isolated instances, our
men abroad have been afflicted with an Identical
predicament. The petitioner has proffered no
argument that the Government should act
similarly with respect to male workers. The Court,
of course, is not impressing some male
chauvinistic notion that men are superior to
women. What the Court is saying is that it was
largely a matter of evidence (that women domestic
workers are being ill-treated abroad in massive
instances) and not upon some fanciful or arbitrary
yardstick that the Government acted in this case.
It is evidence capable indeed of unquestionable
demonstration and evidence this Court accepts.
The Court cannot, however, say the same thing as
far as men are concerned. There is simply no
evidence to justify such an inference. Suffice it to
state, then, that insofar as classifications are
concerned, this Court is content that distinctions
are borne by the evidence. Discrimination in this
case is justified.
As we have furthermore indicated, executive
determinations are generally final on the Court.
Under a republican regime, it is the executive
branch that enforces policy. For their part, the
courts decide, in the proper cases, whether that
policy, or the manner by which it is implemented,
agrees with the Constitution or the laws, but it is
not for them to question its wisdom. As a co-equal
body, the judiciary has great respect for
determinations of the Chief Executive or his
subalterns, especially when the legislature itself
has specifically given them enough room on how
the law should be effectively enforced. In the case
at bar, there is no gainsaying the fact, and the
Court will deal with this at greater length shortly,
that Department Order No. 1 implements the rule-
making powers granted by the Labor Code. But
what should be noted is the fact that in spite of
such a fiction of finality, the Court is on its own
persuaded that prevailing conditions indeed call for
a deployment ban.
There is likewise no doubt that such a
classification is germane to the purpose behind the
measure. Unquestionably, it is the avowed
objective of Department Order No. 1 to "enhance
the protection for Filipino female overseas
workers" 17 this Court has no quarrel that in the
midst of the terrible mistreatment Filipina workers
have suffered abroad, a ban on deployment will be
for their own good and welfare.
The Order does not narrowly apply to existing
conditions. Rather, it is intended to apply
indefinitely so long as those conditions exist. This
is clear from the Order itself ("Pending review of the
administrative and legal measures, in the
Philippines and in the host countries . . ." 18),
meaning to say that should the authorities arrive
at a means impressed with a greater degree of
permanency, the ban shall be lifted. As a stop-gap
measure, it is possessed of a necessary
malleability, depending on the circumstances of
each case. Accordingly, it provides:
 9. LIFTING OF SUSPENSION. — The 5. AUTHORIZED DEPLOYMENT-The
Secretary of Labor and Employment deployment of domestic helpers and
(DOLE) may, upon recommendation workers of similar skills defined
of the Philippine Overseas herein to the following [sic] are
Employment Administration (POEA), authorized under these guidelines
lift the suspension in countries and are exempted from the
where there are: suspension.

1. Bilateral agreements or 5.1 Hirings by

understanding with the Philippines, immediate members
and/or, of the family of Heads
of State and
2. Existing mechanisms providing Government;
for sufficient safeguards to ensure
the welfare and protection of Filipino 5.2 Hirings by
workers. 19 Minister, Deputy
Minister and the
The Court finds, finally, the impugned guidelines other senior
to be applicable to all female domestic overseas government officials;
workers. That it does not apply to "all Filipina and
workers" 20 is not an argument for
unconstitutionality. Had the ban been given 5.3 Hirings by senior
universal applicability, then it would have been officials of the
unreasonable and arbitrary. For obvious reasons, diplomatic corps and
not all of them are similarly circumstanced. What duly accredited
the Constitution prohibits is the singling out of a international
select person or group of persons within an organizations.
existing class, to the prejudice of such a person or
group or resulting in an unfair advantage to 5.4 Hirings by
another person or group of persons. To apply the employers in
ban, say exclusively to workers deployed by A, but countries with whom
not to those recruited by B, would obviously clash the Philippines have
with the equal protection clause of the Charter. It [sic] bilateral labor
would be a classic case of what Chase refers to as agreements or
a law that "takes property from A and gives it to understanding.
B." 21 It would be an unlawful invasion of property
rights and freedom of contract and needless to xxx xxx xxx
state, an invalid act. 22 (Fernando says: "Where the
classification is based on such distinctions that
7. VACATIONING DOMESTIC
make a real difference as infancy, sex, and stage of
HELPERS AND WORKERS OF
civilization of minority groups, the better rule, it
SIMILAR SKILLS--Vacationing
would seem, is to recognize its validity only if the
domestic helpers and/or workers of
young, the women, and the cultural minorities are
similar skills shall be allowed to
singled out for favorable treatment. There would be
process with the POEA and leave for
an element of unreasonableness if on the contrary
worksite only if they are returning to
their status that calls for the law ministering to
the same employer to finish an
their needs is made the basis of discriminatory
existing or partially served
legislation against them. If such be the case, it
employment contract. Those
would be difficult to refute the assertion of denial
workers returning to worksite to
of equal protection." 23 In the case at bar, the
serve a new employer shall be
assailed Order clearly accords protection to certain
covered by the suspension and the
women workers, and not the contrary.)
provision of these guidelines.
It is incorrect to say that Department Order No. 1
xxx xxx xxx
prescribes a total ban on overseas deployment.
From scattered provisions of the Order, it is
evident that such a total ban has hot been 9. LIFTING OF SUSPENSION-The
contemplated. We quote: Secretary of Labor and Employment
(DOLE) may, upon recommendation
of the Philippine Overseas
 Employment Administration (POEA),
lift the suspension in countries
where there are:
1. Bilateral
agreements or
understanding with
the Philippines,
and/or,
2. Existing
mechanisms
providing for
sufficient safeguards
to ensure the welfare
and protection of
Filipino workers. 24
xxx xxx xxx
The consequence the deployment ban has on the
right to travel does not impair the right. The right
to travel is subject, among other things, to the
requirements of "public safety," "as may be
provided by law." 25 Department Order No. 1 is a
valid implementation of the Labor Code, in
particular, its basic policy to "afford protection to
labor," 26 pursuant to the respondent Department
of Labor's rule-making authority vested in it by the
Labor Code. 27 The petitioner assumes that it is
unreasonable simply because of its impact on the
right to travel, but as we have stated, the right
itself is not absolute. The disputed Order is a valid
qualification thereto.
Neither is there merit in the contention that
Department Order No. 1 constitutes an invalid
exercise of legislative power. It is true that police
power is the domain of the legislature, but it does
not mean that such an authority may not be
lawfully delegated. As we have mentioned, the
Labor Code itself vests the Department of Labor
and Employment with rulemaking powers in the
enforcement whereof. 28
The petitioners's reliance on the Constitutional
guaranty of worker participation "in policy and
decision-making processes affecting their rights
and benefits" 29 is not well-taken. The right granted
by this provision, again, must submit to the
demands and necessities of the State's power of
regulation.
The Constitution declares that:
Sec. 3. The State shall afford full
protection to labor, local and
overseas, organized and
unorganized, and promote full
employment and equality of
employment opportunities for all. 30
"Protection to labor" does not signify the promotion
of employment alone. What concerns the
Constitution more paramountly is that such an
employment be above all, decent, just, and
humane. It is bad enough that the country has to
send its sons and daughters to strange lands
because it cannot satisfy their employment needs
at home. Under these circumstances, the
Government is duty-bound to insure that our
toiling expatriates have adequate protection,
personally and economically, while away from
home. In this case, the Government has evidence,
an evidence the petitioner cannot seriously
dispute, of the lack or inadequacy of such
protection, and as part of its duty, it has precisely
ordered an indefinite ban on deployment.
The Court finds furthermore that the Government
has not indiscriminately made use of its authority.
It is not contested that it has in fact removed the
prohibition with respect to certain countries as
manifested by the Solicitor General.
The non-impairment clause of the Constitution,
invoked by the petitioner, must yield to the loftier
purposes targetted by the Government. 31 Freedom
of contract and enterprise, like all other freedoms,
is not free from restrictions, more so in this
jurisdiction, where laissez faire has never been
fully accepted as a controlling economic way of life.
This Court understands the grave implications the
questioned Order has on the business of
recruitment. The concern of the Government,
however, is not necessarily to maintain profits of
business firms. In the ordinary sequence of events,
it is profits that suffer as a result of Government
regulation. The interest of the State is to provide a
decent living to its citizens. The Government has
convinced the Court in this case that this is its
intent. We do not find the impugned Order to be
tainted with a grave abuse of discretion to warrant
the extraordinary relief prayed for.
WHEREFORE, the petition is DISMISSED. No
costs.
SO ORDERED.
EMILIO GANCAYCO V. CITY GOV’T OF Q.C. AND
METRO MANILA DEV’T AUTHORITY
DECISION
SERENO, J.:
 Before us are consolidated Petitions for not allowed to construct his wall up to the edge of
Review under Rule 45 of the Rules of Court the property line, thereby creating a space or
[1]
assailing the Decision promulgated on 18 July shelter under the first floor. In effect, property
[2]
2006 and the Resolution dated 10 May 2007of owners relinquish the use of the space for use as
the Court of Appeals in CA-G.R. SP No. 84648. an arcade for pedestrians, instead of using it for
The Facts their own purposes.

In the early 1950s, retired Justice Emilio A. The ordinance was amended several times.
Gancayco bought a parcel of land located at 746 On 8 August 1960, properties located at the
[3]
Epifanio delos Santos Avenue (EDSA), Quezon Quezon City-San Juan boundary were exempted by
City with an area of 375 square meters and Ordinance No. 60-4477 from the construction of
covered by Transfer Certificate of Title (TCT) No. arcades. This ordinance was further amended by
RT114558. Ordinance No. 60-4513, extending the exemption
to commercial buildings from Balete
On 27 March 1956, the Quezon Street to Seattle Street. Ordinance No. 6603
City Council issued Ordinance No. 2904, entitled dated 1 March 1966 meanwhile reduced the width
An Ordinance Requiring the Construction of of the arcades to three meters for buildings
Arcades, for Commercial Buildings to be along V. Luna Road, Central District, Quezon City.
Constructed in Zones Designated as Business
Zones in the Zoning Plan of Quezon City, and The ordinance covered the property of
[4]
Providing Penalties in Violation Thereof. Justice Gancayco. Subsequently, sometime in
1965, Justice Gancayco sought the exemption of a
An arcade is defined as any portion of a two-storey building being constructed on his
building above the first floor projecting over the property from the application of Ordinance No.
sidewalk beyond the first storey wall used as 2904 that he be exempted from constructing an
protection for pedestrians against rain or sun.[5] arcade on his property.

Ordinance No. 2904 required the relevant On 2 February 1966, the City Council
property owner to construct an arcade with a width acted favorably on Justice Gancaycos request and
of 4.50 meters and height of 5.00 meters along issued Resolution No. 7161, S-66, subject to the
EDSA, from the north side of Santolan Road to one condition that upon notice by the City Engineer,
lot after Liberty Avenue, and from one lot the owner shall, within reasonable time, demolish
before Central Boulevard to the Botocan the enclosure of said arcade at his own expense
transmission line. when public interest so demands.[6]

At the outset, it bears emphasis that at the Decades after, in March 2003, the
time Ordinance No. 2904 was passed by the city Metropolitan Manila Development Authority
council, there was yet no building code passed by (MMDA) conducted operations to clear obstructions
the national legislature. Thus, the regulation of the along the sidewalk of EDSA in Quezon City
construction of buildings was left to the discretion pursuant to Metro Manila Councils (MMC)
of local government units. Under this particular Resolution No. 02-28, Series of 2002. [7] The
ordinance, the city council required that the arcade resolution authorized the MMDA and local
is to be created by constructing the wall of the government units to clear the sidewalks, streets,
ground floor facing the sidewalk a few meters away avenues, alleys, bridges, parks and other public
from the property line. Thus, the building owner is
places in Metro Manila of all illegal structures and he prayed for the payment of just compensation
[8]
obstructions. should the court hold the ordinance valid.

On 28 April 2003, the MMDA sent a notice The City Government of Quezon City
of demolition to Justice Gancayco alleging that a claimed that the ordinance was a valid exercise of
portion of his building violated the National police power, regulating the use of property in a
Building Code of the Philippines (Building Code) business zone. In addition, it pointed out that
[9]
in relation to Ordinance No. 2904. The MMDA Justice Gancayco was already barred by estoppel,
gave Justice Gancayco fifteen (15) days to clear the laches and prescription.
portion of the building that was supposed to be an
arcade along EDSA.[10] Similarly, the MMDA alleged that Justice
Gancayco could not seek the nullification of an
Justice Gancayco did not comply with the ordinance that he had already violated, and that
notice. Soon after the lapse of the fifteen (15) days, the ordinance enjoyed the presumption of
the MMDA proceeded to demolish the party wall, or constitutionality. It further stated that the
what was referred to as the wing walls, of the questioned property was a public nuisance
ground floor structure. The records of the present impeding the safe passage of pedestrians. Finally,
case are not entirely clear on the extent of the the MMDA claimed that it was merely
demolition; nevertheless, the fact of demolition was implementing the legal easement established by
not disputed. At the time of the demolition, the Ordinance No. 2904.[13]
affected portion of the building was being used as a
restaurant. The RTC rendered its Decision on 30
September 2003 in favor of Justice Gancayco.[14] It
On 29 May 2003, Justice Gancayco filed a held that the questioned ordinance was
[11]
Petition with prayer for a temporary restraining unconstitutional, ruling that it allowed the taking
order and/or writ of preliminary injunction before of private property for public use without just
the Regional Trial Court (RTC) of Quezon City, compensation. The RTC said that because 67.5
docketed as Civil Case No. Q03-49693, seeking to square meters out of Justice Gancaycos 375
prohibit the MMDA and the City Government of square meters of property were being taken
Quezon City from demolishing his property. In his without compensation for the publics benefit, the
[12]
Petition, he alleged that the ordinance ordinance was confiscatory and oppressive. It
authorized the taking of private property without likewise held that the ordinance violated owners
due process of law and just compensation, because right to equal protection of laws. The dispositive
the construction of an arcade will require 67.5 portion thus states:
square meters from the 375 square meter property.
WHEREFORE, the petition is
In addition, he claimed that the ordinance was hereby granted and the Court
selective and discriminatory in its scope and hereby declares Quezon City
Ordinance No. 2094,[15] Series of
application when it allowed the owners of the 1956 to be unconstitutional, invalid
buildings located in the Quezon City-San Juan and void ab initio. The respondents
boundary to Cubao Rotonda, and Balete to Seattle are hereby permanently enjoined
from enforcing and implementing
Streets to construct arcades at their option. He the said ordinance, and the
thus sought the declaration of nullity of Ordinance respondent MMDA is hereby
directed to immediately restore the
No. 2904 and the payment of damages. Alternately, portion of the party wall or wing wall
 of the building of the petitioner it avenues, alleys, bridges, parks and other public
destroyed to its original condition.
places in Metro Manila, thus excluding Justice
IT IS SO ORDERED. Gancaycos private property. Lastly, the CA stated
that the MMDA is not clothed with the authority to
The MMDA thereafter appealed from the
declare, prevent or abate nuisances. Thus, the
Decision of the trial court. On 18 July 2006, the
dispositive portion stated:
Court of Appeals (CA) partly granted the appeal.
[16]
The CA upheld the validity of Ordinance No. WHEREFORE, the appeals
are PARTLY GRANTED.
2904 and lifted the injunction against the The Decision dated September 30,
enforcement and implementation of the ordinance. 2003 of the Regional Trial Court,
In so doing, it held that the ordinance was a valid Branch 224, Quezon City,
is MODIFIED, as follows:
exercise of the right of the local government unit to 1) The validity and constitutionality
promote the general welfare of its constituents of Ordinance No. 2094,[18] Series of
1956, issued by the City Council of
pursuant to its police powers. The CA also ruled Quezon City, is UPHELD; and
that the ordinance established a valid classification 2) The injunction against the
enforcement and implementation of
of property owners with regard to the construction
the said Ordinance is LIFTED.
of arcades in their respective properties depending SO ORDERED.
on the location. The CA further stated that there
was no taking of private property, since the owner
This ruling prompted the MMDA and
still enjoyed the beneficial ownership of the
Justice Gancayco to file their respective Motions
property, to wit:
for Partial Reconsideration.[19]
Even with the requirement of
the construction of arcaded On 10 May 2007, the CA denied the
sidewalks within his commercial lot,
appellee still retains the beneficial motions stating that the parties did not present
ownership of the said property. new issues nor offer grounds that would merit the
Thus, there is no taking for public reconsideration of the Court.[20]
use which must be subject to just
compensation. While the arcaded
sidewalks contribute to the public Dissatisfied with the ruling of the CA,
good, for providing safety and Justice Gancayco and the MMDA filed their
comfort to passersby, the ultimate
benefit from the same still redounds respective Petitions for Review before this Court.
to appellee, his commercial The issues raised by the parties are summarized as
establishment being at the forefront
follows:
of a busy thoroughfare like EDSA.
The arcaded sidewalks, by their
I. WHETHER OR NOT JUSTICE
nature, assure clients of the
commercial establishments thereat GANCAYCO WAS ESTOPPED
some kind of protection from FROM ASSAILING THE VALIDITY
accidents and other hazards. OF ORDINANCE NO. 2904.
Without doubt, this sense of II. WHETHER OR NOT
protection can be a boon to the ORDINANCE NO. 2904 IS
business activity therein engaged. [17] CONSTITUTIONAL.
III. WHETHER OR NOT THE WING
WALL OF JUSTICE GANCAYCOS
Nevertheless, the CA held that the MMDA BUILDING IS A PUBLIC NUISANCE.
IV. WHETHER OR NOT THE MMDA
went beyond its powers when it demolished the
LEGALLY DEMOLISHED THE
subject property. It further found that Resolution PROPERTY OF JUSTICE
No. 02-28 only refers to sidewalks, streets, GANCAYCO.

The Courts Ruling
Estoppel
The MMDA and the City Government of Quezon
City both claim that Justice Gancayco was
estopped from challenging the ordinance, because,
in 1965, he asked for an exemption from the
application of the ordinance. According to them,
Justice Gancayco thereby recognized the power of
the city government to regulate the construction of
buildings.
To recall, Justice Gancayco questioned the
constitutionality of the ordinance on two grounds:
(1) whether the ordinance takes private property
without due process of law and just compensation;
and (2) whether the ordinance violates the equal
protection of rights because it allowed exemptions
from its application.
On the first ground, we find that Justice
Gancayco may still question the constitutionality of
the ordinance to determine whether or not the
ordinance constitutes a taking of private property
without due process of law and just compensation.
It was only in 2003 when he was allegedly deprived
of his property when the MMDA demolished a
portion of the building. Because he was granted an
exemption in 1966, there was no taking yet to
speak of.
Moreover, in Acebedo Optical Company, Inc.
v. Court of Appeals,[21] we held:
It is therefore decisively clear
that estoppel cannot apply in this
case. The fact that petitioner
acquiesced in the special conditions
imposed by the City Mayor in
subject business permit does not
preclude it from challenging the said
imposition, which is ultra vires or
beyond the ambit of authority of
respondent City Mayor. Ultra
vires acts or acts which are
clearly beyond the scope of one's
authority are null and void and
cannot be given any effect. The
doctrine of estoppel cannot
operate to give effect to an act
which is otherwise null and void
or ultra vires. (Emphasis supplied.)
Recently, in British American Tobacco v.
Camacho,[22] we likewise held:
We find that petitioner was
not guilty of estoppel. When it made
the undertaking to comply with all
issuances of the BIR, which at that
time it considered as valid,
petitioner did not commit any false
misrepresentation or misleading act.
Indeed, petitioner cannot be faulted
for initially undertaking to comply
with, and subjecting itself to the
operation of Section 145(C), and
only later on filing the subject case
praying for the declaration of its
unconstitutionality when the
circumstances change and the law
results in what it perceives to be
unlawful discrimination. The mere
fact that a law has been relied
upon in the past and all that time
has not been attacked as
unconstitutional is not a ground
for considering petitioner
estopped from assailing its
validity. For courts will pass upon
a constitutional question only
when presented before it in bona
fide cases for determination, and
the fact that the question has not
been raised before is not a valid
reason for refusing to allow it to
be raised later. (Emphasis
supplied.)
Anent the second ground, we find that
Justice Gancayco may not question the ordinance
on the ground of equal protection when he also
benefited from the exemption. It bears emphasis
that Justice Gancayco himself requested for an
exemption from the application of the ordinance in
1965 and was eventually granted one. Moreover,
he was still enjoying the exemption at the time of
the demolition as there was yet no valid notice
from the city engineer. Thus, while the ordinance
may be attacked with regard to its different
treatment of properties that appears to be similarly
situated, Justice Gancayco is not the proper
person to do so.
Zoning and the regulation of the
construction of buildings are valid
exercises of police power .
In MMDA v. Bel-Air Village Association, [23] we
discussed the nature of police powers exercised by
local government units, to wit:
Police power is an inherent
attribute of sovereignty. It has been
defined as the power vested by the
Constitution in the legislature to
make, ordain, and establish all
manner of wholesome and
reasonable laws, statutes and
ordinances, either with penalties or
without, not repugnant to the
Constitution, as they shall judge to
be for the good and welfare of the
commonwealth, and for the subjects
of the same. The power is plenary
and its scope is vast and pervasive,
reaching and justifying measures for
public health, public safety, public
morals, and the general welfare.
It bears stressing that police
power is lodged primarily in the
National Legislature. It cannot be
exercised by any group or body of
individuals not possessing
legislative power. The National
Legislature, however, may delegate
this power to the President and
administrative boards as well as the
lawmaking bodies of municipal
corporations or local government
units. Once delegated, the agents
can exercise only such legislative
powers as are conferred on them by
the national lawmaking body.
To resolve the issue on the constitutionality
of the ordinance, we must first determine whether
there was a valid delegation of police power. Then
we can determine whether the City Government of
Quezon City acted within the limits of
delegation.
It is clear that Congress expressly granted
the city government, through the city council,
police power by virtue of Section 12(oo) of Republic
Act No. 537, or the Revised Charter of Quezon City,
[24]
which states:
To make such further
ordinances and regulations not
repugnant to law as may be
necessary to carry into effect and
discharge the powers and duties
conferred by this Act and such as it
shall deem necessary and proper to
provide for the health and safety,
promote the prosperity, improve the
morals, peace, good order, comfort,
and convenience of the city and the
inhabitants thereof, and for the
protection of property therein; and
enforce obedience thereto with such
lawful fines or penalties as the City
Council may prescribe under the
provisions of subsection (jj) of this
section.
Specifically, on the powers of the city
government to regulate the construction of
buildings, the Charter also expressly provided that
the city government had the power to regulate the
kinds of buildings and structures that may be
erected within fire limits and the manner of
constructing and repairing them.[25]
With regard meanwhile to the power of the
local government units to issue zoning ordinances,
we apply Social Justice Society v. Atienza.[26] In that
case, the Sangguniang
Panlungsod of Manila City enacted an ordinance
on 28 November 2001 reclassifying certain areas of
the city from industrial to commercial. As a result
of the zoning ordinance, the oil terminals located in
those areas were no longer allowed. Though the oil
companies contended that they stood to lose
billions of pesos, this Court upheld the power of
the city government to pass the assailed ordinance,
stating:
the
In the exercise of police
power, property rights of individuals
may be subjected to restraints and
burdens in order to fulfil the
objectives of the government.
Otherwise stated, the government
may enact legislation that may
 interfere with personal liberty, questioned provision is
property, lawful businesses and invalidated. Moreover, in the
occupations to promote the absence of evidence
general welfare. However, the demonstrating the alleged
interference must be reasonable confiscatory effect of the
and not arbitrary. And to forestall provision in question, there is no
arbitrariness, the methods or basis for its nullification in view
means used to protect public of the presumption of validity
health, morals, safety or welfare which every law has in its
must have a reasonable relation favor. (Emphasis supplied.)
to the end in view.
The means adopted by
the Sanggunian was the enactment In the case at bar, it is clear that the
of a zoning ordinance which
reclassified the area where the depot primary objectives of the city council of Quezon
is situated from industrial to City when it issued the questioned ordinance
commercial. A zoning ordinance is
defined as a local city or ordering the construction of arcades were the
municipal legislation which health and safety of the city and its inhabitants;
logically arranges, prescribes,
the promotion of their prosperity; and the
defines and apportions a given
political subdivision into specific improvement of their morals, peace, good order,
land uses as present and future comfort, and the convenience. These arcades
projection of needs. As a result of
the zoning, the continued operation provide safe and convenient passage along the
of the businesses of the oil sidewalk for commuters and pedestrians, not just
companies in their present location
the residents of Quezon City. More especially so
will no longer be permitted. The
power to establish zones for because the contested portion of the building is
industrial, commercial and located on a busy segment of the city, in a
residential uses is derived from
the police power itself and is business zone along EDSA.
exercised for the protection and
benefit of the residents of a Corollarily, the policy of the Building Code,
locality. Consequently, the [28]
which was passed after the Quezon City
enactment of Ordinance No. 8027 is
within the power of Ordinance, supports the purpose for the
the Sangguniang Panlungsod of the enactment of Ordinance No. 2904. The Building
City of Manila and any resulting
burden on those affected cannot be Code states:
said to be unjust... (Emphasis
supplied) Section 102. Declaration of Policy. It
is hereby declared to be the policy of
the State to safeguard life, health,
property, and public welfare,
In Carlos Superdrug v. Department of Social consistent with the principles of
sound environmental management
Welfare and Development,[27] we also held: and control; and to this end, make it
For this reason, when the the purpose of this Code to provide
conditions so demand as determined for all buildings and structures, a
by the legislature, property rights framework of minimum standards
must bow to the primacy of police and requirements to regulate and
power because property rights, control their location, site, design
though sheltered by due process, quality of materials, construction,
must yield to general welfare. occupancy, and maintenance.
Police power as an
attribute to promote the common
good would be diluted Section 1004 likewise requires the
considerably if on the mere plea
of petitioners that they will suffer construction of arcades whenever existing or
loss of earnings and capital, the zoning ordinances require it. Apparently, the law
allows the local government units to determine
whether arcades are necessary within
respective jurisdictions.
Justice Gancayco argues that there is a
three-meter sidewalk in front of his property line,
and the arcade should be constructed above that
sidewalk rather than within his property line. We
do not need to address this argument inasmuch as
it raises the issue of the wisdom of the city
ordinance, a matter we will not and need not delve
into.
To reiterate, at the time that the ordinance
was passed, there was no national building code
enforced to guide the city council; thus, there was
no law of national application that prohibited the
city council from regulating the construction of
buildings, arcades and sidewalks in
jurisdiction.
The wing walls of the building are not
nuisances per se.
The MMDA claims that the portion of the building
in question is a nuisance per se.
We disagree.
The fact that in 1966 the City Council gave
Justice Gancayco an exemption from constructing
an arcade is an indication that the wing walls of
the building are not nuisances per se.The wing
walls do not per se immediately and adversely
affect the safety of persons and property. The fact
that an ordinance may declare a structure illegal
does not necessarily make that structure
nuisance.
Article 694 of the Civil Code
nuisance as any act, omission, establishment,
business, condition or property, or anything else
that (1) injures or endangers the health or safety of
others; (2) annoys or offends the senses; (3)
shocks, defies or disregards decency or morality;
(4) obstructs or interferes with the free passage of
any public highway or street, or any body of water;
their or, (5) hinders or impairs the use of property. A
nuisance may be per se or per accidens. A
nuisance per se is that which affects the immediate
safety of persons and property and may summarily
be abated under the undefined law of necessity.[29]
Clearly, when Justice Gancayco was given a
permit to construct the building, the city council or
the city engineer did not consider the building, or
its demolished portion, to be a threat to the safety
of persons and property. This fact alone should
have warned the MMDA against summarily
demolishing the structure.
Neither does the MMDA have the power to
declare a thing a nuisance. Only courts of law have
the power to determine whether a thing is a
their nuisance. In AC Enterprises v. Frabelle Properties
Corp.,[30] we held:
We agree with petitioner's
contention that, under Section
447(a)(3)(i) of R.A. No. 7160,
otherwise known as the Local
Government Code, the Sangguniang
Panglungsod is empowered to enact
ordinances declaring, preventing or
abating noise and other forms of
nuisance. It bears stressing,
however, that the Sangguniang
Bayan cannot declare a particular
thing as a nuisance per se and order
its condemnation. It does not have
the power to find, as a fact, that a
particular thing is a nuisance
when such thing is not a
nuisance per se; nor can it
authorize the extrajudicial
condemnation and destruction of
that as a nuisance which in its
a
nature, situation or use is not
such. Those things must be
determined and resolved in the
defines ordinary courts of law. If a thing be
in fact, a nuisance due to the
manner of its operation, that
question cannot be determined by a
mere resolution of the Sangguniang
Bayan. (Emphasis supplied.)
 MMDA illegally demolished charged with the duties of issuing
the property of Justice Gancayco. building permits.

MMDA alleges that by virtue of MMDA In the performance of his duties, a

Building Official may enter any
Resolution No. 02-28, Series of 2002, it is building or its premises at all
empowered to demolish Justice Gancaycos reasonable times to inspect and
determine compliance with the
property. It insists that the Metro Manila Council requirements of this Code, and the
authorized the MMDA and the local government terms and conditions provided for in
the building permit as issued.
units to clear the sidewalks, streets, avenues,
alleys, bridges, parks and other public places in When any building work is found
Metro Manila of all illegal structures and to be contrary to the provisions of
this Code, the Building Official
obstructions. It further alleges that it demolished may order the work stopped and
the property pursuant to the Building Code in prescribe the terms and/or
conditions when the work will be
relation to Ordinance No. 2904 as amended.
allowed to resume. Likewise, the
Building Official is authorized to
However, the Building Code clearly provides order the discontinuance of the
the process by which a building may be occupancy or use of any building
or structure or portion thereof
demolished. The authority to order the demolition found to be occupied or used
of any structure lies with the Building Official. The contrary to the provisions of this
Code.
pertinent provisions of the Building Code provide:
xxx xxx xxx
SECTION 205. Building Officials.
Except as otherwise provided herein,
SECTION 215. Abatement of
the Building Official shall be
Dangerous Buildings. When any
responsible for carrying out the
building or structure is found or
provisions of this Code in the field
declared to be dangerous or
as well as the enforcement of orders
ruinous, the Building Official
and decisions made pursuant
shall order its repair, vacation or
thereto.
demolition depending upon the
degree of danger to life, health,
Due to the exigencies of the service,
or safety. This is without
the Secretary may designate
prejudice to further action that
incumbent Public Works District
may be taken under the
Engineers, City Engineers and
provisions of Articles 482 and
Municipal Engineers act as Building
694 to 707 of the Civil Code of
Officials in their respective areas of
the Philippines. (Emphasis
jurisdiction.
supplied.)
The designation made by the
Secretary under this Section shall
continue until regular positions of
Building Official are provided or MMDA v. Trackworks Rail Transit
unless sooner terminated for causes Advertising, Vending and Promotions, Inc. [31] is
provided by law or decree.
applicable to the case at bar. In that case, MMDA,
xxx xxx xxx invoking its charter and the Building Code,
summarily dismantled the advertising media
SECTION 207. Duties of a Building
Official. In his respective territorial installed on the Metro Rail Transit (MRT) 3. This
jurisdiction, the Building Official Court held:
shall be primarily responsible for It is futile for MMDA to
the enforcement of the provisions of simply invoke its legal mandate to
this Code as well as of the justify the dismantling of
implementing rules and regulations Trackworks' billboards, signages
issued therefor. He is the official and other advertising media. MMDA
simply had no power on its own to The Court also agrees with the CA's ruling
dismantle, remove, or destroy the
that MMDA Regulation No. 96-009 and
billboards, signages and other
advertising media installed on the MMC Memorandum Circular No. 88-09 did
MRT3 structure by Trackworks. not apply to Trackworks' billboards,
In Metropolitan Manila Development signages and other advertising media. The
Authority v. Bel-Air Village
Association, Inc., Metropolitan prohibition against posting, installation and
Manila Development Authority v. display of billboards, signages and other
Viron Transportation Co., Inc., advertising media applied only to public
and Metropolitan Manila
areas, but MRT3, being private property
Development Authority v. Garin, the
Court had the occasion to rule pursuant to the BLT agreement between
that MMDA's powers were limited the Government and MRTC, was not one
to the formulation, coordination, of the areas as to which the prohibition
regulation, implementation,
preparation, management, applied. Moreover, MMC Memorandum
monitoring, setting of policies, Circular No. 88-09 did not apply to
installing a system, and Trackworks' billboards, signages and other
administration. Nothing in advertising media in MRT3, because it did
Republic Act No. 7924 granted
MMDA police power, let alone not specifically cover MRT3, and because it
legislative power. was issued a year prior to the construction
of MRT3 on the center island of EDSA.
Clarifying the real nature of Clearly, MMC Memorandum Circular No.
MMDA, the Court held: 88-09 could not have included MRT3 in its
prohibition.
...The MMDA is, as termed
in the charter itself, a MMDA's insistence that it
"development authority". It is an was only implementing Presidential
agency created for the purpose of Decree No. 1096 (Building Code) and
laying down policies and its implementing rules and
coordinating with the various regulations is not persuasive. The
national government agencies, power to enforce the provisions of
people's organizations, non- the Building Code was lodged in
governmental organizations and the Department of Public Works
the private sector for the efficient and Highways (DPWH), not in
and expeditious delivery of basic MMDA, considering the law's
services in the vast metropolitan following provision, thus:
area. All its functions are
administrative in nature and Sec. 201. Responsibility for
these are actually summed up in Administration and
the charter itself, viz: Enforcement. -
The administration and
Sec.2. Creation of the enforcement of the
provisions of this Code
Metropolitan Manila Develop including the imposition of
ment Authority.- xxx. penalties for administrative
The MMDA shall perform violations thereof is hereby
planning, monitoring and vested in the Secretary of
coordinative functions, and Public Works, Transportation
in the process exercise and Communications,
regulatory and supervisory hereinafter referred to as the
authority over the delivery of "Secretary."
metro-wide services within
Metro Manila, without There is also no evidence
diminution of the autonomy showing that MMDA had been
of local government units delegated by DPWH to implement
concerning purely local the Building Code. (Emphasis
matters. supplied.)

Additionally, the penalty prescribed by
Ordinance No. 2904 itself does not include the
demolition of illegally constructed buildings in case
of violations. Instead, it merely prescribes a
punishment of a fine of not more than two
hundred pesos (P200.00) or by imprisonment of
not more than thirty (30) days, or by both such
fine and imprisonment at the discretion of the
Court, Provided, that if the violation is committed
by a corporation, partnership, or any juridical
entity, the Manager, managing partner, or any
person charged with the management thereof shall
be held responsible therefor. The ordinance itself
also clearly states that it is the regular courts that
will determine whether there was a violation of the
ordinance.
As pointed out in Trackworks, the MMDA
does not have the power to enact ordinances.
Thus, it cannot supplement the provisions of
Quezon City Ordinance No. 2904 merely through
its Resolution No. 02-28.
Lastly, the MMDA claims that the City
Government of Quezon City may be considered to
have approved the demolition of the structure,
simply because then Quezon City Mayor Feliciano
R. Belmonte signed MMDA Resolution No. 02-28.
In effect, the city government delegated these
powers to the MMDA. The powers referred to are
those that include the power to declare, prevent
and abate a nuisance[32] and to further impose the
penalty of removal or demolition of the building or
structure by the owner or by the city at the
expense of the owner.[33]
MMDAs argument does not hold water.
There was no valid delegation of powers to the
MMDA. Contrary to the claim of the MMDA, the
City Government of Quezon City washed its hands
off the acts of the former. In its Answer, [34] the city
government stated that the demolition was
undertaken by the MMDA only, without the
participation and/or consent of Quezon City.
Therefore, the MMDA acted on its own and should
be held solely liable for the destruction of the
portion of Justice Gancaycos building.
WHEREFORE, in view of the foregoing, the
Decision of the Court of Appeals in CA-G.R. SP No.
84648 is AFFIRMED.
SO ORDERED.
G.R. No. 135962 March 27, 2000
METROPOLITAN MANILA DEVELOPMENT
AUTHORITY, petitioner,
vs.
BEL-AIR VILLAGE ASSOCIATION,
INC., respondent.
PUNO, J.:
Not infrequently, the government is tempted to
take legal shortcuts solve urgent problems of the
people. But even when government is armed with
the best of intention, we cannot allow it to run
roughshod over the rule of law. Again, we let the
hammer fall and fall hard on the illegal attempt of
the MMDA to open for public use a private road in
a private subdivision. While we hold that the
general welfare should be promoted, we stress that
it should not be achieved at the expense of the rule
of law.
Petitioner MMDA is a government agency tasked
with the delivery of basic services in Metro Manila.
Respondent Bel-Air Village Association, Inc. (BAVA)
is a non-stock, non-profit corporation whose
members are homeowners in Bel-Air Village, a
private subdivision in Makati City. Respondent
BAVA is the registered owner of Neptune Street, a
road inside Bel-Air Village.
On December 30, 1995, respondent received from
petitioner, through its Chairman, a notice dated
December 22, 1995 requesting respondent to open
Neptune Street to public vehicular traffic starting
January 2, 1996. The notice reads:
SUBJECT: NOTICE of the Opening of
Neptune Street to Traffic.
Dear President Lindo,
 Please be informed that pursuant to the
mandate of the MMDA law or Republic Act
No. 7924 which requires the Authority to
rationalize the use of roads and/or
thoroughfares for the safe and convenient
movement of persons, Neptune Street shall
be opened to vehicular traffic effective
January 2, 1996.
In view whereof, the undersigned requests
you to voluntarily open the points of entry
and exit on said street.
Thank you for your cooperation and
whatever assistance that may be extended
by your association to the MMDA personnel
who will be directing traffic in the area.
Makati by ordinance. The decision disposed of as
follows:
WHEREFORE, the Petition is GRANTED;
the challenged Order dated January 23,
1995, in Civil Case No. 96-001, is SET
ASIDE and the Writ of Preliminary
Injunction issued on February 13, 1996 is
hereby made permanent.
For want of sustainable substantiation, the
Motion to Cite Roberto L. del Rosario in
contempt is denied. 5
No pronouncement as to costs.
SO ORDERED. 6

Finally, we are furnishing you with a copy The Motion for Reconsideration of the decision was
of the handwritten instruction of the denied on September 28, 1998. Hence, this
President on the matter. recourse.

Very truly yours, Petitioner MMDA raises the following questions:

PROSPERO I. ORETA I
1
Chairman HAS THE METROPOLITAN MANILA
DEVELOPMENT AUTHORITY (MMDA) THE
On the same day, respondent was apprised MANDATE TO OPEN NEPTUNE STREET TO
that the perimeter wall separating the PUBLIC TRAFFIC PURSUANT TO ITS
subdivision from the adjacent Kalayaan REGULATORY AND POLICE POWERS?
Avenue would be demolished.
II
On January 2, 1996, respondent instituted against
petitioner before the Regional Trial Court, Branch IS THE PASSAGE OF AN ORDINANCE A
136, Makati City, Civil Case No. 96-001 for CONDITION PRECEDENT BEFORE THE
injunction. Respondent prayed for the issuance of MMDA MAY ORDER THE OPENING OF
a temporary restraining order and preliminary SUBDIVISION ROADS TO PUBLIC
injunction enjoining the opening of Neptune Street TRAFFIC?
and prohibiting the demolition of the perimeter
wall. The trial court issued a temporary restraining
III
order the following day.

IS RESPONDENT BEL-AIR VILLAGE

On January 23, 1996, after due hearing, the trial
ASSOCIATION, INC. ESTOPPED FROM
court denied issuance of a preliminary
DENYING OR ASSAILING THE AUTHORITY
injunction. 2 Respondent questioned the denial
OF THE MMDA TO OPEN THE SUBJECT
before the Court of Appeals in CA-G.R. SP No.
STREET?
39549. The appellate court conducted an ocular
inspection of Neptune Street 3 and on February 13,
1996, it issued a writ of preliminary injunction IV
enjoining the implementation of the MMDA's
proposed action. 4 WAS RESPONDENT DEPRIVED OF DUE
PROCESS DESPITE THE SEVERAL
On January 28, 1997, the appellate court rendered MEETINGS HELD BETWEEN MMDA AND
a Decision on the merits of the case finding that THE AFFECTED EEL-AIR RESIDENTS AND
the MMDA has no authority to order the opening of BAVA OFFICERS?
Neptune Street, a private subdivision road and
cause the demolition of its perimeter walls. It held V
that the authority is lodged in the City Council of
 HAS RESPONDENT COME TO COURT
WITH UNCLEAN HANDS?7
Neptune Street is owned by respondent BAVA. It is
a private road inside Bel-Air Village, a private
residential subdivision in the heart of the financial
and commercial district of Makati City. It runs
parallel to Kalayaan Avenue, a national road open
to the general public. Dividing the two (2) streets is
a concrete perimeter wall approximately fifteen (15)
feet high. The western end of Neptune Street
intersects Nicanor Garcia, formerly Reposo Street,
a subdivision road open to public vehicular traffic,
while its eastern end intersects Makati Avenue, a
national road. Both ends of Neptune Street are
guarded by iron gates.
Petitioner MMDA claims that it has the authority to
open Neptune Street to public traffic because it is
an agent of the state endowed with police power in
the delivery of basic services in Metro Manila. One
of these basic services is traffic management which
involves the regulation of the use of thoroughfares
to insure the safety, convenience and welfare of the
general public. It is alleged that the police power of
MMDA was affirmed by this Court in the
consolidated cases of Sangalang v. Intermediate
Appellate Court. 8 From the premise that it has
police power, it is now urged that there is no need
for the City of Makati to enact an ordinance
opening Neptune street to the public. 9
Police power is an inherent attribute of sovereignty.
It has been defined as the power vested by the
Constitution in the legislature to make, ordain,
and establish all manner of wholesome and
reasonable laws, statutes and ordinances, either
with penalties or without, not repugnant to the
Constitution, as they shall judge to be for the good
and welfare of the commonwealth, and for the
subjects of the same. 10 The power is plenary and
its scope is vast and pervasive, reaching and
justifying measures for public health, public safety,
public morals, and the general welfare. 11
It bears stressing that police power is lodged
primarily in the National Legislature. 12 It cannot be
exercised by any group or body of individuals not
possessing legislative power. 13 The National
Legislature, however, may delegate this power to
the President and administrative boards as well as
the lawmaking bodies of municipal corporations or
local government units. 14 Once delegated, the
agents can exercise only such legislative powers as
are conferred on them by the national lawmaking
body. 15
A local government is a "political subdivision of a
nation or state which is constituted by law and has
substantial control of local affairs." 16 The Local
Government Code of 1991 defines a local
government unit as a "body politic and
corporate." 17 — one endowed with powers as a
political subdivision of the National Government
and as a corporate entity representing the
inhabitants of its territory. 18 Local government
units are the provinces, cities, municipalities and
barangays. 19 They are also the territorial and
political subdivisions of the state. 20
Our Congress delegated police power to the local
government units in the Local Government Code of
1991. This delegation is found in Section 16 of the
same Code, known as the general welfare
clause, viz:
Sec. 16. General Welfare. — Every local
government unit shall exercise the powers
expressly granted, those necessarily implied
therefrom, as well as powers necessary,
appropriate, or incidental for its efficient
and effective governance, and those which
are essential to the promotion of the general
welfare. Within their respective territorial
jurisdictions, local government units shall
ensure and support, among other things,
the preservation and enrichment of culture,
promote health and safety, enhance the
right of the people to a balanced ecology,
encourage and support the development of
appropriate and self-reliant scientific and
technological capabilities, improve public
morals, enhance economic prosperity and
social justice, promote full employment
among their residents, maintain peace and
order, and preserve the comfort and
convenience of their inhabitants. 21
Local government units exercise police power
through their respective legislative bodies. The
legislative body of the provincial government is
the sangguniang panlalawigan, that of the city
government is the sangguniang panlungsod, that of
the municipal government is the sangguniang
bayan, and that of the barangay is
the sangguniang barangay. The Local Government
Code of 1991 empowers the sangguniang
panlalawigan, sangguniang panlungsod and
sangguniang bayan to "enact ordinances, approve
resolutions and appropriate funds for the general
welfare of the [province, city or municipality, as the
case may be], and its inhabitants pursuant to
Section 16 of the Code and in the proper exercise
of the corporate powers of the [province, city
municipality] provided under the Code . . . " 22 The
same Code gives the sangguniang barangay the
power to "enact ordinances as may be necessary to
discharge the responsibilities conferred upon it by
law or ordinance and to promote the general
welfare of the inhabitants thereon." 23
Metropolitan or Metro Manila is a body composed of
several local government units — i.e., twelve (12)
cities and five (5) municipalities, namely, the cities
of Caloocan, Manila, Mandaluyong, Makati, Pasay,
Pasig, Quezon, Muntinlupa, Las Pinas, Marikina,
Paranaque and Valenzuela, and the municipalities
of Malabon, Navotas, Pateros, San Juan and
Taguig. With the passage of Republic Act (R. A.)
No. 7924 24 in 1995, Metropolitan Manila was
declared as a "special development and
administrative region" and the Administration
of "metro-wide" basic services affecting the region
placed under "a development authority" referred to
as the MMDA. 25
"Metro-wide services" are those "services which
have metro-wide impact and transcend local
political boundaries or entail huge expenditures
such that it would not be viable for said services to
be provided by the individual local government
units comprising Metro Manila." 26 There are seven
(7) basic metro-wide services and the scope of
these services cover the following: (1) development
planning; (2) transport and traffic management; (3)
solid waste disposal and management; (4) flood
control and sewerage management; (5) urban
renewal, zoning and land use planning, and shelter
services; (6) health and sanitation, urban
protection and pollution control; and (7) public
safety. The basic service of transport and traffic
management includes the following:
(b) Transport and traffic management which
include the formulation, coordination, and
monitoring of policies, standards, programs
and projects to rationalize the existing
transport operations, infrastructure
requirements,the use of thoroughfares, and
promotion of safe and convenient movement
of persons and goods; provision for the mass
transport system and the institution of a
system to regulate road
users; administration and implementation of
all traffic enforcement operations, traffic
engineering services and traffic education
programs, including the institution of a
single ticketing system in Metropolitan
Manila;" 27
In the delivery of the seven (7) basic services, the
MMDA has the following powers and functions:
Sec. 5. Functions and powers of the Metro
Manila Development Authority. — The
MMDA shall:
(a) Formulate, coordinate and regulate the
implementation of medium and long-term
plans and programs for the delivery of
metro-wide services, land use and physical
development within Metropolitan Manila,
consistent with national development
objectives and priorities;
(b) Prepare, coordinate and regulate the
implementation of medium-term investment
programs for metro-wide services which
shall indicate sources and uses of funds for
priority programs and projects, and which
shall include the packaging of projects and
presentation to funding institutions;
(c) Undertake and manage on its own
metro-wide programs and projects for the
delivery of specific services under its
jurisdiction, subject to the approval of the
Council. For this purpose, MMDA can
create appropriate project management
offices;
(d) Coordinate and monitor the
implementation of such plans, programs
and projects in Metro Manila; identify
bottlenecks and adopt solutions to
problems of implementation;
(e) The MMDA shall set the policies
concerning traffic in Metro Manila, and shall
coordinate and regulate the implementation
of all programs and projects concerning
traffic management, specifically pertaining
to enforcement, engineering and
education. Upon request, it shall be
extended assistance and
cooperation, including but not limited
to, assignment of personnel, by all other
government agencies and offices concerned;
(f) Install and administer a single ticketing
system, fix, impose and collect fines and
penalties for all kinds of violations of traffic
rules and regulations, whether moving or
non-moving in nature, and confiscate and
suspend or revoke drivers' licenses in the
enforcement of such traffic laws and
regulations, the provisions of RA 4136 and
PD 1605 to the contrary
notwithstanding. For this purpose, the
Authority shall impose all traffic laws and
regulations in Metro Manila, through its
traffic operation center, and may deputize
members of the PNP, traffic enforcers of local
government units, duly licensed security
guards, or members of non-governmental
organizations to whom may be delegated
certain authority, subject to such conditions
and requirements as the Authority may
impose; and
 (g) Perform other related functions required
to achieve the objectives of the MMDA,
including the undertaking of delivery of
basic services to the local government
units, when deemed necessary subject to
prior coordination with and consent of the
local government unit concerned.
The implementation of the MMDA's plans, programs
and projects is undertaken by the local government
units, national government agencies, accredited
people's organizations, non-governmental
organizations, and the private sector as well as by
the MMDA itself. For this purpose, the MMDA has
the power to enter into contracts, memoranda of
agreement and other arrangements with these
bodies for the delivery of the required services
Metro Manila. 28
The governing board of the MMDA is the Metro
Manila Council. The Council is composed of the
mayors of the component 12 cities and 5
municipalities, the president of the Metro Manila
Vice-Mayors' League and the president of the Metro
Manila Councilors' League. 29 The Council is
headed by Chairman who is appointed by the
President and vested with the rank of cabinet
member. As the policy-making body of the MMDA,
the Metro Manila Council approves metro-wide
plans, programs and projects, and issues the
necessary rules and regulations for the
implementation of said plans; it approves the
annual budget of the MMDA and promulgate the
rules and regulations for the delivery of basic
services, collection of service and regulatory fees,
fines and penalties. These functions are
particularly enumerated as follows:
Sec. 6. Functions of the Metro Manila
Council. —
(a) The Council shall be the policy-making
body of the MMDA;
(b) It shall approve metro-wide plans,
programs and projects and issue rules and
regulations deemed necessary by the
MMDA to carry out the purposes of this
Act;
(c) It may increase the rate of allowances
and per diems of the members of the
Council to be effective during the term of
the succeeding Council. It shall fix the
compensation of the officers and personnel
of the MMDA, and approve the annual
budget thereof for submission to the
Department of Budget and Management
(DBM);
(d) It shall promulgate rules and regulations
and set policies and standards for metro-
wide application governing the delivery of
basic services, prescribe and collect service
and regulatory fees, and impose and collect
fines and penalties.
Clearly, the scope of the MMDA's function is
limited to the delivery of the seven (7) basic
services. One of these is transport and traffic
management which includes the formulation and
monitoring of policies, standards and projects to
rationalize the existing transport operations,
infrastructure requirements, the use of
thoroughfares and promotion of the safe movement
of persons and goods. It also covers the mass
transport system and the institution of a system of
road regulation, the administration of all traffic
enforcement operations, traffic engineering services
and traffic education programs, including the
institution of a single ticketing system in Metro
Manila for traffic violations. Under the service, the
MMDA is expressly authorized "to set the policies
concerning traffic" and "coordinate and regulate
the implementation of all traffic management
programs." In addition, the MMDA may "install and
administer a single ticketing system," fix, impose
and collect fines and penalties for all traffic
violations.
It will be noted that the powers of the MMDA are
limited to the following acts: formulation,
coordination, regulation, implementation,
preparation, management, monitoring, setting of
policies, installation of a system and
administration. There is no syllable in
R.A. No. 7924 that grants the MMDA police
power, let alone legislative power. Even the Metro
Manila Council has not been delegated any
legislative power. Unlike the legislative bodies of
the local government units, there is no provision in
R.A. No. 7924 that empowers the MMDA or its
Council to "enact ordinances, approve resolutions
appropriate funds for the general welfare" of the
inhabitants of Metro Manila. The MMDA is, as
termed in the charter itself, "development
authority." 30 It is an agency created for the
purpose of laying down policies and coordinating
with the various national government agencies,
people's organizations, non-governmental
organizations and the private sector for the
efficient and expeditious delivery of basic services
in the vast metropolitan area. All its functions are
administrative in nature and these are actually
summed up in the charter itself, viz:
Sec. 2. Creation of the Metropolitan Manila
Development Authority. — . . . .
 The MMDA shall
perform planning, monitoring and
coordinative functions, and in the process
exercise regulatory and supervisory
authority over the delivery of metro-wide
services within Metro Manila, without
diminution of the autonomy of the local
government units concerning purely local
matters. 31
Petitioner cannot seek refuge in the cases
of Sangalang v. Intermediate Appellate
Court 32 where we upheld a zoning ordinance issued
by the Metro Manila Commission (MMC), the
predecessor of the MMDA, as an exercise of police
power. The first Sangalang decision was on the
merits of the petition, 33 while the second decision
denied reconsideration of the first case and in
addition discussed the case of Yabut v. Court of
Appeals. 34
Sangalang v. IAC involved five (5) consolidated
petitions filed by respondent BAVA and three
residents of Bel-Air Village against other residents
of the Village and the Ayala Corporation, formerly
the Makati Development Corporation, as the
developer of the subdivision. The petitioners
sought to enforce certain restrictive easements in
the deeds of sale over their respective lots in the
subdivision. These were the prohibition on the
setting up of commercial and advertising signs on
the lots, and the condition that the lots be used
only for residential purposes. Petitioners alleged
that respondents, who were residents along Jupiter
Street of the subdivision, converted their
residences into commercial establishments in
violation of the "deed restrictions," and that
respondent Ayala Corporation ushered in the full
commercialization" of Jupiter Street by tearing
down the perimeter wall that separated the
commercial from the residential section of the
village. 35
The petitions were dismissed based on Ordinance
No. 81 of the Municipal Council of Makati and
Ordinance No. 81-01 of the Metro Manila
Commission (MMC). Municipal Ordinance No. 81
classified Bel-Air Village as a Class A Residential
Zone, with its boundary in the south extending to
the center line of Jupiter Street. The Municipal
Ordinance was adopted by the MMC under the
Comprehensive Zoning Ordinance for the National
Capital Region and promulgated as MMC
Ordinance No. 81-01. Bel-Air Village was indicated
therein as bounded by Jupiter Street and the block
adjacent thereto was classified as a High Intensity
Commercial Zone. 36
We ruled that since both Ordinances recognized
Jupiter Street as the boundary between Bel-Air
Village and the commercial district, Jupiter Street
was not for the exclusive benefit of Bel-Air
residents. We also held that the perimeter wall on
said street was constructed not to separate the
residential from the commercial blocks but simply
for security reasons, hence, in tearing down said
wall, Ayala Corporation did not violate the "deed
restrictions" in the deeds of sale.
We upheld the ordinances, specifically MMC
Ordinance No. 81-01, as a legitimate exercise of
police power. 37 The power of the MMC and the
Makati Municipal Council to enact zoning
ordinances for the general welfare prevailed over
the "deed restrictions".
In the second Sangalang/Yabut decision, we held
that the opening of Jupiter Street was warranted
by the demands of the common good in terms of
"traffic decongestion and public convenience."
Jupiter was opened by the Municipal Mayor to
alleviate traffic congestion along the public streets
adjacent to the Village. 38 The same reason was
given for the opening to public vehicular traffic of
Orbit Street, a road inside the same village. The
destruction of the gate in Orbit Street was also
made under the police power of the municipal
government. The gate, like the perimeter wall along
Jupiter, was a public nuisance because it hindered
and impaired the use of property, hence, its
summary abatement by the mayor was proper and
legal. 39
Contrary to petitioner's claim, the two Sangalang
cases do not apply to the case at bar. Firstly, both
involved zoning ordinances passed by the
municipal council of Makati and the MMC. In the
instant case, the basis for the proposed opening of
Neptune Street is contained in the notice of
December 22, 1995 sent by petitioner to
respondent BAVA, through its president. The
notice does not cite any ordinance or law, either by
the Sangguniang Panlungsod of Makati City or by
the MMDA, as the legal basis for the proposed
opening of Neptune Street. Petitioner MMDA
simply relied on its authority under its charter "to
rationalize the use of roads and/or thoroughfares
for the safe and convenient movement of persons."
Rationalizing the use of roads and thoroughfares is
one of the acts that fall within the scope of
transport and traffic management. By no stretch of
the imagination, however, can this be interpreted
as an express or implied grant of ordinance-
making power, much less police power.
Secondly, the MMDA is not the same entity as the
MMC in Sangalang. Although the MMC is the
forerunner of the present MMDA, an examination
of Presidential Decree (P. D.) No. 824, the charter
of the MMC, shows that the latter possessed
greater powers which were not bestowed on the
present MMDA.
Metropolitan Manila was first created in 1975 by
Presidential Decree (P.D.) No. 824. It comprised the
Greater Manila Area composed of the contiguous
four (4) cities of Manila, Quezon, Pasay and
Caloocan, and the thirteen (13) municipalities of
Makati, Mandaluyong, San Juan, Las Pinas,
Malabon, Navotas, Pasig, Pateros, Paranaque,
Marikina, Muntinlupa and Taguig in the province
of Rizal, and Valenzuela in the province of
Bulacan. 40 Metropolitan Manila was created as a
response to the finding that the rapid growth of
population and the increase of social and economic
requirements in these areas demand a call for
simultaneous and unified development; that the
public services rendered by the respective local
governments could be administered more
efficiently and economically if integrated under a
system of central planning; and this coordination,
"especially in the maintenance of peace and order
and the eradication of social and economic ills that
fanned the flames of rebellion and discontent
[were] part of reform measures under Martial Law
essential to the safety and security of the State." 41
Metropolitan Manila was established as a "public
corporation" with the following powers:
Sec. 1. Creation of the Metropolitan Manila.
— There is hereby created a public
corporation, to be known as the
Metropolitan Manila, vested with powers
and attributes of a corporation including the
power to make contracts, sue and be
sued, acquire, purchase, expropriate, hold, t
ransfer and dispose of property and such
other powers as are necessary to carry out
its purposes. The Corporation shall be
administered by a Commission created
under this Decree. 42
The administration of Metropolitan Manila was
placed under the Metro Manila Commission (MMC)
vested with the following powers:
Sec. 4. Powers and Functions of the Commission. —
The Commission shall have the following powers
and functions:
1. To act as a central government to
establish and administer programs and
provide services common to the area;
2. To levy and collect taxes and special
assessments, borrow and expend money
and issue bonds, revenue certificates, and
other obligations of indebtedness. Existing
tax measures should, however, continue to
be operative until otherwise modified or
repealed by the Commission;
3. To charge and collect fees for the use of
public service facilities;
4. To appropriate money for the operation
of the metropolitan government and review
appropriations for the city and municipal
units within its jurisdiction with authority
to disapprove the same if found to be not in
accordance with the established policies of
the Commission, without prejudice to any
contractual obligation of the local
government units involved existing at the
time of approval of this Decree;
5. To review, amend, revise or repeal all
ordinances, resolutions and acts of cities
and municipalities within Metropolitan
Manila;
6. To enact or approve ordinances,
resolutions and to fix penalties for any
violation thereof which shall not exceed a
fine of P10,000.00 or imprisonment of six
years or both such fine and imprisonment
for a single offense;
7. To perform general administrative,
executive and policy-making functions;
8. To establish a fire control operation
center, which shall direct the fire services of
the city and municipal governments in the
metropolitan area;
9. To establish a garbage disposal operation
center, which shall direct garbage collection
and disposal in the metropolitan area;
10. To establish and operate a transport
and traffic center, which shall direct traffic
activities;
11. To coordinate and monitor
governmental and private activities
pertaining to essential services such as
transportation, flood control and drainage,
water supply and sewerage, social, health
and environmental services, housing, park
development, and others;
12. To insure and monitor the undertaking
of a comprehensive social, economic and
physical planning and development of the
area;
 13. To study the feasibility of increasing
barangay participation in the affairs of their
respective local governments and to
propose to the President of the Philippines
definite programs and policies for
implementation;
14. To submit within thirty (30) days after
the close of each fiscal year an annual
report to the President of the Philippines
and to submit a periodic report whenever
deemed necessary; and
15. To perform such other tasks as may be
assigned or directed by the President of the
Philippines.
The MMC was the "central government" of Metro
Manila for the purpose of establishing and
administering programs providing services
common to the area. As a "central government" it
had the power to levy and collect taxes and special
assessments, the power to charge and collect fees;
the power to appropriate money for its operation,
and at the same time, review appropriations for the
city and municipal units within its jurisdiction. It
was bestowed the power to enact or approve
ordinances, resolutions and fix penalties for
violation of such ordinances and resolutions. It
also had the power to review, amend, revise or
repeal all ordinances, resolutions and acts of any
of the four (4) cities and thirteen (13)
municipalities comprising Metro Manila.
P.D. No. 824 further provided:
Sec. 9. Until otherwise provided, the
governments of the four cities and thirteen
municipalities in the Metropolitan Manila
shall continue to exist in their present form
except as may be inconsistent with this
Decree. The members of the existing city
and municipal councils in Metropolitan
Manila shall, upon promulgation of this
Decree, and until December 31, 1975,
become members of the Sangguniang Bayan
which is hereby created for every city and
municipality of Metropolitan Manila.
In addition, the Sangguniang Bayan shall
be composed of as many barangay captains
as may be determined and chosen by the
Commission, and such number of
representatives from other sectors of the
society as may be appointed by the
President upon recommendation of the
Commission.
xxx xxx xxx
The Sangguniang Bayan may recommend
to the Commission ordinances, resolutions
or such measures as it may adopt;
Provided, that no such ordinance,
resolution or measure shall become
effective, until after its approval by the
Commission; and Provided further, that the
power to impose taxes and other levies, the
power to appropriate money and the power
to pass ordinances or resolutions with
penal sanctions shall be vested exclusively
in the Commission.
The creation of the MMC also carried with it the
creation of the Sangguniang Bayan. This was
composed of the members of the component city
and municipal councils, barangay captains chosen
by the MMC and sectoral representatives appointed
by the President. The Sangguniang Bayan had the
power to recommend to the MMC the adoption of
ordinances, resolutions or measures. It was the
MMC itself, however, that possessed legislative
powers. All ordinances, resolutions and measures
recommended by the Sangguniang Bayan were
subject to the MMC's approval. Moreover, the
power to impose taxes and other levies, the power
to appropriate money, and the power to pass
ordinances or resolutions with penal sanctions
were vested exclusively in the MMC.
Thus, Metropolitan Manila had a "central
government," i.e., the MMC which fully possessed
legislative police powers. Whatever legislative
powers the component cities and municipalities
had were all subject to review and approval by the
MMC.
After President Corazon Aquino assumed power,
there was a clamor to restore the autonomy of the
local government units in Metro Manila. Hence,
Sections 1 and 2 of Article X of the 1987
Constitution provided:
Sec. 1. The territorial and political
subdivisions of the Republic of the
Philippines are the provinces, cities,
municipalities and barangays. There shall
be autonomous regions in Muslim
Mindanao and the Cordilleras as herein
provided.
Sec. 2. The territorial and political
subdivisions shall enjoy local autonomy.
The Constitution, however, recognized the
necessity of creating metropolitan regions not only
in the existing National Capital Region but also in
potential equivalents in the Visayas and
Mindanao. 43 Section 11 of the same Article X thus
provided:
 Sec. 11. The Congress may, by law, create
special metropolitan political subdivisions,
subject to a plebiscite as set forth in
Section 10 hereof. The component cities
and municipalities shall retain their basic
autonomy and shall be entitled to their own
local executives and legislative assemblies.
The jurisdiction of the metropolitan
authority that will thereby be created shall
be limited to basic services requiring
coordination.
Constitution itself expressly provides that Congress
may, by law, create "special metropolitan political
subdivisions" which shall be subject to approval by
a majority of the votes cast in a plebiscite in the
political units directly affected; the jurisdiction of
this subdivision shall be limited to basic services
requiring coordination; and the cities and
municipalities comprising this subdivision shall
retain their basic services requiring coordination;
and the cities and municipalities comprising this
subdivision shall retain their basic autonomy and
their own local executive and legislative
assemblies. 44 Pending enactment of this law, the
Transitory Provisions of the Constitution gave the
President of the Philippines the power to constitute
the Metropolitan Authority, viz:
Sec. 8. Until otherwise provided by
Congress, the President may constitute the
Metropolitan Authority to be composed of
the heads of all local government units
comprising the Metropolitan Manila area. 45
In 1990, President Aquino issued Executive Order
(E. O.) No. 392 and constituted the Metropolitan
Manila Authority (MMA). The powers and functions
of the MMC were devolved to the MMA. 46 It ought
to be stressed, however, that not all powers and
functions of the MMC were passed to the MMA.
The MMA's power was limited to the "delivery of
basic urban services requiring coordination in
Metropolitan Manila." 47 The MMA's governing
body, the Metropolitan Manila Council, although
composed of the mayors of the component cities
and municipalities, was merely given power of: (1)
formulation of policies on the delivery of basic
services requiring coordination and consolidation;
and (2) promulgation resolutions and other
issuances, approval of a code of basic services and
the exercise of its rule-making power. 48
Under the 1987 Constitution, the local government
units became primarily responsible for the
governance of their respective political
subdivisions. The MMA's jurisdiction was limited to
addressing common problems involving basic
services that transcended local boundaries. It did
not have legislative power. Its power was merely to
provide the local government units technical
assistance in the preparation of local development
plans. Any semblance of legislative power it had
was confined to a "review [of] legislation proposed
by the local legislative assemblies to ensure
consistency among local governments and with the
comprehensive development plan of Metro Manila,"
and to "advise the local governments
accordingly." 49
When R.A. No. 7924 took effect, Metropolitan
Manila became a "special development and
administrative region" and the MMDA a "special
development authority" whose functions were
"without prejudice to the autonomy of the affected
local government units." The character of the
MMDA was clearly defined in the legislative
debates enacting its charter.
R.A. No. 7924 originated as House Bill No.
14170/11116 and was introduced by several
legislators led by Dante Tinga, Roilo Golez and
Feliciano Belmonte. It was presented to the House
of Representatives by the Committee on Local
Governments chaired by Congressman Ciriaco R.
Alfelor. The bill was a product of Committee
consultations with the local government units in
the National Capital Region (NCR), with former
Chairmen of the MMC and MMA, 50 and career
officials of said agencies. When the bill was first
taken up by the Committee on Local Governments,
the following debate took place:
THE CHAIRMAN [Hon. Ciriaco Alfelor]:
Okay, Let me explain. This has been
debated a long time ago, you know. It's a
special . . . we can create a special
metropolitan political subdivision.
Actually, there are only six (6) political
subdivisions provided for in the
Constitution: barangay, municipality, city,
province, and we have the Autonomous
Region of Mindanao and we have the
Cordillera. So we have 6. Now. . . . .
HON. [Elias] LOPEZ: May I interrupt, Mr.
Chairman. In the case of the Autonomous
Region, that is also specifically mandated
by the Constitution.
THE CHAIRMAN: That's correct. But it is
considered to be a political subdivision.
What is the meaning of a political
subdivision? Meaning to say, that it has its
own government, it has its own political
personality, it has the power to tax, and all
governmental powers: police power and
everything. All right. Authority is different;
because it does not have its own
 government. It is only a council, it is an
organization of political subdivision,
powers, "no, which is not imbued with any
political power.
If you go over Section 6, where the powers
and functions of the Metro Manila
Development Authority, it is purely
coordinative. And it provides here that the
council is policy-making. All right.
Under the Constitution is a Metropolitan
Authority with coordinative power. Meaning
to say, it coordinates all of the different
basic services which have to be delivered to
the constituency. All right.
There is now a problem. Each local
government unit is given its respective . . .
as a political subdivision. Kalookan has its
powers, as provided for and protected and
guaranteed by the Constitution. All right,
the exercise. However, in the exercise of
that power, it might be deleterious and
disadvantageous to other local government
units. So, we are forming an authority
where all of these will be members and then
set up a policy in order that the basic
services can be effectively coordinated. All
right.
Of course, we cannot deny that the MMDA
has to survive. We have to provide some
funds, resources. But it does not possess
any political power. We do not elect the
Governor. We do not have the power to tax.
As a matter of fact, I was trying to intimate
to the author that it must have the power to
sue and be sued because it coordinates. All
right. It coordinates practically all these
basic services so that the flow and the
distribution of the basic services will be
continuous. Like traffic, we cannot deny
that. It's before our eyes. Sewerage, flood
control, water system, peace and order, we
cannot deny these. It's right on our face. We
have to look for a solution. What would be
the right solution? All right, we envision
that there should be a coordinating agency
and it is called an authority. All right, if you
do not want to call it an authority, it's
alright. We may call it a council or maybe a
management agency.
51
xxx xxx xxx
Clearly, the MMDA is not a political unit of
government. The power delegated to the MMDA is
that given to the Metro Manila Council to
promulgate administrative rules and regulations in
the implementation of the MMDA's functions.
There is no grant of authority to enact ordinances
and regulations for the general welfare of the
inhabitants of the metropolis. This was explicitly
stated in the last Committee deliberations prior to
the bill's presentation to Congress. Thus:
THE CHAIRMAN: Yeah, but we have to go
over the suggested revision. I think this was
already approved before, but it was
reconsidered in view of the proposals, set-
up, to make the MMDA stronger. Okay, so if
there is no objection to paragraph "f". . .
And then next is paragraph "b," under
Section 6. "It shall approve metro-wide
plans, programs and projects and issue
ordinances or resolutions deemed necessary
by the MMDA to carry out the purposes of
this Act." Do you have the powers? Does the
MMDA... because that takes the form of a
local government unit, a political subdivision.
HON. [Feliciano] BELMONTE: Yes, I believe
so, your Honor. When we say that it has the
policies, it's very clear that those policies
must be followed. Otherwise, what's the use
of empowering it to come out with policies.
Now, the policies may be in the form of a
resolution or it may be in the form of a
ordinance. The term "ordinance" in this
case really gives it more teeth, your honor.
Otherwise, we are going to see a situation
where you have the power to adopt the
policy but you cannot really make it stick
as in the case now, and I think here is
Chairman Bunye. I think he will agree that
that is the case now. You've got the power
to set a policy, the body wants to follow
your policy, then we say let's call it an
ordinance and see if they will not follow it.
THE CHAIRMAN: That's very nice. I like
that. However, there is a constitutional
impediment.1âwphi1 You are making this
MMDA a political subdivision. The creation
of the MMDA would be subject to a
plebiscite. That is what I'm trying to avoid.
I've been trying to avoid this kind of
predicament. Under the Constitution it
states: if it is a political subdivision, once it
is created it has to be subject to a
plebiscite. I'm trying to make this as
administrative. That's why we place the
Chairman as a cabinet rank.
HON. BELMONTE: All right, Mr. Chairman,
okay, what you are saying there is . . . . .
THE CHAIRMAN: In setting up ordinances,
it is a political exercise, Believe me.
 HON. [Elias] LOPEZ: Mr. Chairman, it can
be changed into issuances of rules and
regulations. That would be . . . it shall also
be enforced.
HON. BELMONTE: Okay, I will . . . .
HON. LOPEZ: And you can also say that
violation of such rule, you impose a
sanction. But you know, ordinance has a
different legal connotation.
HON. BELMONTE: All right, I defer to that
opinion, your Honor.
THE CHAIRMAN: So instead of ordinances,
say rules and regulations.
HON. BELMONTE: Or resolutions. Actually,
they are actually considering resolutions
now.
THE CHAIRMAN: Rules and resolutions.
HON. BELMONTE: Rules, regulations and
resolutions. 52
The draft of H. B. No. 14170/11116 was presented
by the Committee to the House of Representatives.
The explanatory note to the bill stated that the
proposed MMDA is a "development authority"
which is a "national agency, not a political
government unit." 53 The explanatory note was
adopted as the sponsorship speech of the
Committee on Local Governments. No
interpellations or debates were made on the floor
and no amendments introduced. The bill was
approved on second reading on the same day it
was presented. 54
When the bill was forwarded to the Senate, several
amendments were made.1âwphi1 These
amendments, however, did not affect the nature of
the MMDA as originally conceived in the House of
Representatives. 55
It is thus beyond doubt that the MMDA is not a
local government unit or a public corporation
endowed with legislative power. It is not even a
"special metropolitan political subdivision" as
contemplated in Section 11, Article X of the
Constitution. The creation of a "special
metropolitan political subdivision" requires the
approval by a majority of the votes cast in a
plebiscite in the political units directly
affected." 56 R. A. No. 7924 was not submitted to
the inhabitants of Metro Manila in a plebiscite. The
Chairman of the MMDA is not an official elected by
the people, but appointed by the President with the
rank and privileges of a cabinet member. In fact,
part of his function is to perform such other duties
as may be assigned to him by the
President, 57 whereas in local government units, the
President merely exercises supervisory authority.
This emphasizes the administrative character of
the MMDA.
Clearly then, the MMC under P.D. No. 824 is not
the same entity as the MMDA under R.A. No. 7924.
Unlike the MMC, the MMDA has no power to enact
ordinances for the welfare of the community. It is
the local government units, acting through their
respective legislative councils, that possess
legislative power and police power. In the case at
bar, the Sangguniang Panlungsod of Makati City
did not pass any ordinance or resolution ordering
the opening of Neptune Street, hence, its proposed
opening by petitioner MMDA is illegal and the
respondent Court of Appeals did not err in so
ruling. We desist from ruling on the other issues as
they are unnecessary.
We stress that this decision does not make light of
the MMDA's noble efforts to solve the chaotic traffic
condition in Metro Manila. Everyday, traffic jams
and traffic bottlenecks plague the metropolis. Even
our once sprawling boulevards and avenues are
now crammed with cars while city streets are
clogged with motorists and pedestrians. Traffic has
become a social malaise affecting our people's
productivity and the efficient delivery of goods and
services in the country. The MMDA was created to
put some order in the metropolitan transportation
system but unfortunately the powers granted by its
charter are limited. Its good intentions cannot
justify the opening for public use of a private street
in a private subdivision without any legal warrant.
The promotion of the general welfare is not
antithetical to the preservation of the rule of
law.1âwphi1.nêt
IN VIEW WHEREOF, the petition is denied. The
Decision and Resolution of the Court of Appeals in
CA-G.R. SP No. 39549 are affirmed.
SO ORDERED.
G.R. No. 213948
KNIGHTS OF RIZAL, Petitioner.
vs.
DMCI HOMES, INC., DMCI PROJECT
DEVELOPERS, INC., CITY OF MANILA,
NATIONAL COMMISSION FOR CULTURE AND
THE ARTS, NATIONAL HISTORICAL
COMMISSION OF THE
PHILIPPINES, Respondents.
DECISION
CARPIO, J.:
Bury me in the ground, place a stone and a cross
over it.
My name, the date of my birth, and of my death.
Nothing more.
If you later wish to surround my grave with a fence,
you may do so.
No anniversaries. I prefer Paang Bundok.- Jose
Rizal
The Case
Before this Court is a Petition for Injunction, with
Applications for Temporary Restraining Order, Writ
of Preliminary Injunction, and Others 1 filed by the
Knights of Rizal (KOR) seeking, among others, for
an order to stop the construction of respondent
DMCI Homes, Inc. 's condominium development
project known as the Torre de Manila. In its
Resolution dated 25 November 2014, the Court
resolved to treat the petition as one for
mandamus. 2
The Facts
On 1 September 2011, DMCI Project Developers,
Inc. (DMCI-PDI) 3 acquired a 7,716.60-square
meter lot in the City of Manila, located near Taft
Avenue, Ermita, beside the former Manila Jai-Alai
Building and Adamson University.4The lot was
earmarked for the construction of DMCI-PDI's
Torre de Manila condominium project.
On 2 April 2012, DMCI-PDI secured its Barangay
Clearance to start the construction of its project. It
then obtained a Zoning Permit from the City of
Manila's City Planning and Development Office
(CPDO) on 19 June 2012.5
Then, on 5 July 2012, the City of Manila's Office of
the Building Official granted DMCI-PDI a Building
Permit, allowing it to build a "Forty Nine (49)
Storey w/ Basement & 2 penthouse Level
Res'l./Condominium" on the property. 6
On 24 July 2012, the City Council of Manila issued
Resolution No. 121 enjoining the Office of the
Building Official to temporarily suspend the
Building Permit of DMCI-PDI, citing among others,
that "the Torre de Manila Condominium, based on
their development plans, upon completion, will rise
up high above the back of the national monument,
to clearly dwarf the statue of our hero, and with
such towering heights, would certainly ruin the
line of sight of the Rizal Shrine from the frontal
Roxas Boulevard vantage point[.]"7
Building Official Melvin Q. Balagot then sought the
opinion of the City of Manila's City Legal Officer on
whether he is bound to comply with Resolution No.
121.8 In his letter dated 12 September 2012, City
Legal Officer Renato G. Dela Cruz stated that there
is "no legal justification for the temporary
suspension of the Building Permit issued in favor
of [DMCI-PDI]" since the construction "lies outside
the Luneta Park" and is "simply too far to I be a
repulsive distraction or have an objectionable effect
on the artistic and historical significance" of the
Rizal Monument. 9 He also pointed out that "there
is no showing that the [area of subject property
has been officially declared as an anthropological
or archeological area. Neither has it ' been
categorically designated by the National Historical
Institute as a heritage zone, a cultural property, a
historical landmark or even a national treasure."
Subsequently, both the City of Manila and DMCI-
PDI sought the opinion or the National Historical
Commission of the Philippines (NHCP) on the
matter. In the letter10 dated 6 November 2012 from
NHCP I Chairperson Dr. Maria Serena I. Diokno
addressed to DMCI-PDI and the letter 11 dated 7
November 2012 from NHCP Executive Director III
Ludovico D. Bado)f addressed to then Manila
Mayor Alfredo S. Lim, the NHCP maintained that
the Torre de Manila project site is outside the
boundaries of the Rizal f.ark and well to the rear of
the Rizal Monument, and thus, cannot possibly
obstruct the frontal view of the National
Monument.
On 26 November 2013, following an online petition
against the Torre de Manila project that garnered
about 7,800 signatures, the City Council of Manila
issued Resolution No. 146, reiterating its directive
in Resolution No. 121 1 enjoining the City of
Manila's building officials to temporarily suspend
~MCI-PDI's Building Permit. 12
In a letter to Mayor Joseph Ejercito Estrada dated
18 December 2013, DMCI-PIDI President Alfredo R.
Austria sought clarification on the controversy
surrounding its Zoning Permit. He stated that
since the CPDO granted its Zoning Permit, DMCI-
PDI continued with the application for the Building
Permit, which was granted, and did not deem it
necessary to go through the process of appealing to
the local zoning board. He then expressed DMCI-
PDI's willingness to comply with the process if the
City of Manila deemed it necessary. 13
On 23 December 2013, the Manila Zoning Board of
Adjustments and Appeals (MZBAA) issued Zoning
Board Resolution No. 06, Series of
2013, 14 recommending the approval of DMCI-PDI's
application for variance. ;The MZBAA noted that
the Torre de Manila project "exceeds the prescribed
maximum Percentage of Land Occupancy (PLO)
and exceeds the prescribeµ Floor Area Ratio (FAR)
as stipulated in Article V, Section 17 of City
Ordinance No. 8119[.]" However, the MZBAA still
recommended the approval of the variance subject
to the five conditions set under the same
resolution.
After some clarification sought by DMCI-PDI, the
MZBAA issued Zoning Board Resolution No. 06-A,
Series of 2013, 15 on 8 January 2014, amending
condition (c) in the earlier resolution. 16
On 16 January 2014, the City Council of Manila
issued Resolution No. 5, Series of 2014, 17 adopting
Zoning Board Resolution Nos. 06 and 06- A. The
City Council resolution states that "the City
Council of Manila find[ s] no cogent reason to deny
and/or reverse the aforesaid recommendation of
the [MZBAA] and hereby ratif[ies] and confirm[s] all
previously issued permits, licenses and approvals
issued by the City [Council] of Manila for Torre de
Manila[.]"
Arguments of the KOR
On 12 September 2014, the KOR, a "civic,
patriotic, cultural, nonpartisan, non-sectarian and
non-profit organization" 18 created under Republic
Act No. 646, 19 filed a Petition for Injunction
seeking a temporary restraining I order, and later a
permanent injunction, against the construction of
DMCIPDI's Torre de Manila condominium project.
The KOR argues that the subject matter of the
present suit is one of "transcendental importance,
paramount public interest, of overarching
significance to society, or with far-reaching
implication" involving the desecration of the Rizal
Monument.
The KOR asserts that the completed Torre de
Manila structure will "[stick] out like a sore thumb,
[dwarf] all surrounding buildings within a radius of
two kilometer/s" and "forever ruin the sightline of
the Rizal Monument in Luneta Park: Torre de
Manila building would loom at the back I and
overshadow the entire monument, whether up
close or viewed from a distance. ''20
Further, the KOR argues that the Rizal Monument,
as a National Treasure, is entitled to "full
protection of the law"21and the national
government must abate the act or activity that
endangers the nation's cultural heritage "even
against the wishes of the local government hosting
it." 22
Next, the KOR contends that the project is a
nuisance per se23 because "[t]he despoliation of the
sight view of the Rizal Monument is a situation
that annoy's or offends the senses' of every Filipino
who honors the memory of the National Hero Jose
Rizal. It is a present, continuing, worsening and
aggravating status or condition. Hence, the
PROJECT is a nuisance per se. It deserves I to be
abated summarily, even without need of judicial
proceeding. "24
The KOR also claims that the Torre de Manila
project violates the NHCP's Guidelines on
Monuments Honoring National Heroes, Illustrious
Filipinos and Other Personages, which state that
historic monuments should assert a visual
"dominance" over its surroundings,25 as well as the
country's commitment under the International
Charter for the Conservation and Restoration of
Monuments and Sites, otherwise known as the
Venice Charter. 26
Lastly, the KOR claims that the DMCI-PDI's
construction was commenced and continues in
bad faith, and is in violation of the City of Manila's
zoning ordinance. 27
Arguments of DMCI-PDI
In its Comment, DMCI-PDI argues that the KOR's
petition should be dismissed on the following
grounds:
I.
THXS HONORABLE COURT HAS NO
JURISDICTION OVER THIS ACTION.
II.
KOR HAS NO LEGAL RIGHT OR INTEREST TO
FILE OR PR0SECUTE THIS ACTION.
III.
TORRE DE MANILA IS NOT A NUISANCE PER SE.
IV.
DMCI-PDI ACTED IN GOOD FAITH IN
CONSTRUCTING TORRE DE MANILA; AND
V.
KOR IS NOT ENTITLED TO A TEMPORARY
RESTRAINING ORPER AND/OR A WRIT OF
PRELIMINARY INJUNCTION. 28
First, DMCI-PDI asserts that the Court has no
original jurisdiction over actions for
injunction.29 Even assuming that the Court has
concurrent jurisdiction, DMCI-PDI maintains that
the petition should still have been filed with the
Regional Trial Court under the doctrine of
hierarchy of courts and because the petition
involves questions of fact. 30
DMCI-PDI also contends that the KOR's petition is
in actuality an opposition' or appeal from the
exemption granted by the City of Manila's MZBAA,
a matter which is also not within the jurisdiction of
the Court. 31 DMCI-PDI claims that the proper
forum should be the MZBAA, and should the KOR
fail there, it should appeal the same to the Housing
and Land Use Regulatory Board (HLURB). 32
DMCI-PDI further argues that since the Rizal
Monument has been declared a National Treasure,
the power to issue a cease and desist order is
lodged with the "appropriate cultural agency"
under Section 25 of Republic Act No. li0066 or
the National Cultural Heritage Act of
2009. 33 Moreover, DMCI-PDI asserts that the KOR
availed of the wrong remedy since an action for
injunction is not the proper remedy for abatement
of a nuisance. 34
Second, DMCI-PDI maintains that the KOR has no
standing to institute this proceeding because it is
not a real party in interest in this case. The
purposes of the KOR as a public corporation do not
include the preservation of the Rizal Monument as
a cultural or historical heritage site. 35 The KOR has
also not shown that it suffered an actual or
threatened injury as a result of the alleged illegal
conduct of the City of Manila. If there is any injury
to the KOR at all, the same was caused by the
private conduct of a private entity and not the City
of Manila. 36
Third, DMCI-PDI argues that the Torre de Manila is
not a nuisance per se. DMCI-PDI reiterates that it
obtained all the necessary permits, licenses,
clearances, and certificates for its
construction. 37 It also refutes the KOR's claim that
the Torre de Manila would dwarf all other
structures around it; considering that there are
other tall buildings even closer to the Rizal
Monument itself, namely, the Eton Baypark Tower
at the corner of Roxas Boulevard and T.M. Kalaw
Street (29 storeys; 235 meters from the Rizal
Monument) and Sunview Palace at the corner of
M.H. Del Pilar and T.M. Kalaw Streets (42 storeys;
250 meters from the Rizal Monument). 38
Fourth, DMCI-PDI next argues that it did not act in
bad faith when it started construction of its Torre
de Manila project. Bad faith cannot be attributed
to it since it was within the "lawful exercise of [its]
rights." 39 The KOR failed to present any proof that
DMCI-PDI did not follow the proper procedure and
zoning restrictions of the City of Manila. Aside from
obtaining all the necessary permits from the
appropriate government agencies,40 DMCI-PDI also
sought clarification on its right to build on its site
from the Office of the City Legal Officer of Manila,
the Manila CPDO, and the NHCP. 41 Moreover, even
if the KOR proffered such proof, the Court would
be 1 in no position to declare DMCI-PDI's acts as
illegal since the Court is not a trier of facts. 42
Finally, DMCI-PDI opposes the KOR's application
for a Temporary Restraining Order (TRO) and writ
of preliminary injunction. DMCI-PDI asserts that
the KOR has failed to establish "a clear and
unmistakable right to enjoin I the construction of
Torre de Manila, much less request its
demolitior."43 DMCI-PDI further argues that it "has
complied with all the legal requirements for the
construction of Torre de Manila x x x [and] has
violated o right of KOR that must be protected.
Further, KOR stands to suffer o damage because of
its lack of direct pecuniary interest in this petiti1
on. To grant the KOR's application for injunctive
relief would constitute an unjust taking of property
without due process of law. "44
Arguments of the City of Manila
In its Comment, the City of Manila argues that the
writ of mandamus cannot issue "considering that
no property or substantive rights whatsoever in
favor of [the KOR] is being affected or x x x entitled
to judicial protection[.]"45
The City of Manila also asserts that the "issuance
and revocation of a Building Permit undoubtedly
fall under the category of a discretionary act or
duty performed by the proper officer in light of his
meticulous appraisal and evaluation of the
pertinent supporting documents of the application
in accordance with the rules laid out under the
National Building Code [and] Presidential Decree
No. 1096,"46 while the remedy of mandamus is
available only to compel the performance of a
ministerial duty. 47
Further, the City of Manila maintains that the
construction of the Torre de Manila did not violate
any existing law, since the "edifice [is] well behind
(some 789 meters away) the line of sight of the
Rizal Monument."48 It adds that the City of
Manila's "prevailing Land Use and Zoning
Ordinance [Ordinance No. 8119] x xx allows an
adjustment in Floor Area Ratios thru the [MZBAA]
subject to further final approval of the City
Council."49 The City Council adopted the MZBAA's
favorable: recommendation in its Resolution No. 5,
ratifying all the licenses and permits issued to
DMCI-PDI for its Torre de Manila project.
In its Position Paper dated 15 July 2015, the City
of Manila admitted that the Zoning Permit issued
to DMCI-PDI was "in breach of certain provisions of
City Ordinance No. 8119."50 It maintained,
however, 1 that the deficiency is "procedural in
nature and pertains mostly td the failure of [DMCI-
PDI] to comply with the stipulations that allow an
excess in the [FAR] provisions." 51 Further, the City
of Manila argued that the MZBAA, when it
recommended the allowance of the project's
variance, imposed certain conditions upon the
Torre de Manila project in order to mitigate the
possible adverse effects of an excess FAR. 52
The Issue
The issues raised by the parties can be summed
up into one main point: Can the Court issue a writ
of mandamus against the officials of the City of
Manila to stop the construction of DMCI-PDI's
Torre de Manila project?
The Court's Ruling
The petition for mandamus lacks merit and must
be dismissed.
There is no law prohibiting the construction of
the Torre de Manila.
In Manila Electric Company v. Public Service
Commission,53 the Court held that "what is not
expressly or impliedly prohibited by law may be
done, except when the act is contrary to
morals, customs and I public order." This
principle is fundamental in a democratic society, to
protect the weak against the strong, the minority
against the majority, and the individual citizen
against the government. In essence, this principle,
which is the foundation of a civilized society under
the rule of law, prescribes that the freedom to act
can be curtailed only through law. Without this
principle, the rights, freedoms, and civil liberties of
citizens can be arbitrarily and whimsically
trampled upon by the shifting passions of those
who can spout the loudest, or those who can
gather the biggest crowd or the most number of
Internet trolls. In other instances, 54 the Court has
allowed or upheld actions that were not expressly
prohibited by statutes when it determined that
these acts were not contrary to morals, customs,
and public order, or that upholding the same
would lead to a more equitable solution to the
controversy. However, it is the law itself - Articles
130655 and 1409(1)56 of the Civil Code - which
prescribes that acts not contrary to morals, good
customs, public order, or public policy are allowed
if also not contrary to law.
In this case, there is no allegation or proof that the
Torre de Manila project is "contrary to morals,
customs, and public order" or that it brings harm,
danger, or hazard to the community. On the
contrary, the City of Manila has determined that
DMCI-PDI complied with the standards set under
the pertinent laws and local ordinances to
construct its Torre de Manila project.
There is one fact that is crystal clear in this case.
There is no law prohibiting the construction of the
Torre de Manila due to its effect on
the background "view, vista, sightline, or setting"
of the Rizal Monument.
Specifically, Section 47 reads:
SEC. 47. Historical Preservation and Conservation
Standards. - Historic site and facilities shall be
conserved and preserved. These shall, to the extent
possible, be made accessible for the educational
and cultural enrichment of the general public.
The following shall guide the development of
historic sites and facilities:
1. Sites with historic buildings or places shall be
developed to conserve and enhance their heritage
values.
2. Historic sites and facilities shall be adaptively
re-used.
3. Any person who proposes to add, to alter, or
partially demolish a designated heritage property
will require the approval of the City Planning and
Development Office (CPDO) and shall be required
to prepare a heritage impact statement that will
demonstrate to the satisfaction of CPDO that the
proposal will not adversely impact the heritage
significance of the property and shall submit plans
for review by the CPDO in coordination with the
National Historical Institute (NHI).
4. Any proposed alteration and/or re-use of
designated heritage properties shall be evaluated
based on criteria established by the heritage
significance of the particular property or site.
5. Where an owner of a heritage property applies
for approval to demolish a designated heritage
property or properties, the owner shall be required
to provide evidence to satisfaction that
demonstrates that rehabilitation and re-use of the
property is not viable.
6. Any designated heritage property which is to be
demolished or significantly altered shall be
thoroughly documented for archival purposes with!
a history, photographic records, and measured
drawings, in accordance with accepted heritage
recording guidelines, prior to demolition or
alteration.
7. Residential and commercial infill in heritage
areas will be sensitive to the existing scale and
pattern of those areas, which maintains the
existing landscape and streetscape qualities of
those areas, and which does not result in the loss
of any heritage resources.
8. Development plans shall ensure that parking
facilities (surface lots residential garages, stand-
alone parking garages and parking components as
parts of larger developments) are compatibly
integrated into heritage areas, and/or are
compatible with adjacent heritage resources.
9. Local utility companies (hydro, gas, telephone,
cable) shall be required to place metering
equipment, transformer boxes, power lines,
conduit, equipment boxes, piping, wireless
telecommunication towers and other utility
equipment and devices in locations which do not
detract from the visual character of heritage
resources, and which do not have a negative
impact on its architectural integrity.
10. Design review approval shall be secured from
the CPDO for any alteration of the heritage
property to ensure that design guidelines and
standards are met and shall promote preservation
and conservation of the heritage property.
(Emphasis supplied)
It is clear that the standards laid down in Section
47 of Ordinance No. 8119 only serve as guides, as
it expressly states that "the following shall guide
the :development of historic sites and facilities."
A guide simply sets a direction 'or gives an
instruction to be followed by prope1iy owners and
developers in order to conserve and enhance a
property's heritage values.
On the other hand, Section 48 states:
SEC. 48. Site Performance Standards. - The City
considers it in the public interest that all projects
are designed and developed in a safe, efficient and
aesthetically pleasing manner. Site development
shall consider the environmental character and
limitations of the site and its adjacent properties.
All project elements shall be in complete harmony
according to good design principles and the
subsequent development must be visually pleasing
as well as efficiently functioning especially in
relation to the adjacent properties and bordering
streets.
The design, construction, operation and
maintenance of every facility shall be in harmony
with the existing and intended character of its
neighborhood. It shall not change the essential
character of the said area but will be a substantial
improvement to the value of the properties in the
neighborhood in particular and the community in
general.
Furthermore, designs should consider the
following:
1. Sites, buildings and facilities shall be designed
and developed with1 regard to safety, efficiency
and high standards of design. The natural
environmental character of the site and its
adjacent properties shall be considered in the site
development of each building and facility.
2. The height and bulk of buildings and structures
shall be so designed that it does not impair the
entry of light and ventilation, cause the loss I of
privacy and/or create nuisances, hazards or
inconveniences to adjacent developments.
3. Abutments to adjacent properties shall not be
allowed without the neighbor's prior written
consent which shall be required by the City
Planning and Development Office (CPDO) prior to
the granting of a Zoning Permit (Locational
Clearance).
4. The capacity of parking areas/lots shall be per
the minimum requirements of the National
Building Code. These shall be located, developed
and landscaped in order to enhance the aesthetic
quality of the facility. In no case, shall parking
areas/lots encroach into street rights-of-way and
shall follow the Traffic Code as set by the City.
5. Developments that attract a significant volume
of public modes of transportation, such as
tricycles, jeepneys, buses, etc., shall provide on-
site parking for the same. These shall also provide
vehicular loading and unloading bays so as street
traffic flow will not be impeded.
6. Buffers, silencers, mufflers, enclosures and
other noise-absorbing I materials shall be provided
to all noise and vibration-producing machinery.
Noise levels shall be maintained according to levels
specified in DENR DA9 No. 30 - Abatement of
Noise and Other Forms of Nuisance as Defined by
Law.
7. Glare and heat from any operation or activity
shall not be radiated, seen or felt from any point
beyond the limits of the property.
8. No large commercial signage and/or pylon,
which will be detrimental to the skyline, shall
be allowed.
9. Design guidelines, deeds of restriction, property
management plans and other regulatory tools that
will ensure high quality developments shall be
required from developers of commercial
subdivisions and condominiums. These shall be
submitted to the City Planning and Development
Office (CPDO) for review and approval. (Emphasis
supplied)
Se9tion 4 7 of Ordinance No. 8119 specifically
regulates the "development of historic sites and
facilities."Section 48 regulates "large commercial
signage and/or pylon." There is nothing in
Sections 47 and 48 of Ordinance No. 8119 that
disallows the construction of a building outside
the boundaries of a historic site or
facility, where such building may affect the1
background of a historic site. In this case, the
Torre de Manila stands 870 meters outside and to
the rear of the Rizal Monument and "cannot
possibly obstruct the front view of the [Rizal]
Monument." 57 Likewise, ;the Torre de Manila is not
in an area that has been declared as an
"anthropological or archeological area" or in an
area designated as a heritage zone, cultural
property, historical landmark, or a national
treasure by the NHCP. 58
Section 15, Article XIV of the Constitution, which
deals with the subject of arts and culture, provides
that "[t]he State shall conserve, promote and
popularize the nation's historical and cultural
heritage and resources x x x." Since this provision
is not self-executory, Congress passed laws dealing
with the preservation and conservation of our
cultural heritage.
One such law is Republic Act No. 10066,59 or
the National Cultural Heritage Act of 2009, which
empowers the National Commission for Culture
and the Arts and other cultural agencies to issue a
cease and desist order "when the physical
integrity of the national cultural treasures or
important cultural properties [is] found to be in
danger of destruction or significant alteration
from its original state."60 This law declares that
the State should protect the "physical integrity" of
the heritage property or building if there is "danger
of destruction or significant alteration from its
original state." Physical integrity refers to the
structure itself - how strong and sound the
structure is. The same law does not mention
that another project, building, or property, not
itself a heritage property or building, may be the
subject of a cease and desist order when it
adversely affects the background view, vista, or
sightline of a heritage property or building. Thus,
Republic Act No. 10066 cannot apply to the Torre
de Manila condominium project.
Mandamus does not lie against the City of
Manila.
The Constitution states that "[n]o person shall be
deprived of life, liberty or 1property without due
process of law x x x." 61 It is a fundamental
principle that no property shall be taken away from
an individual without due process, whether
substantive or procedural. The dispossession of
property, or in this case the stoppage of the
construction of a building in one's own property
would violate substantive due process.
The Rules on Civil Procedure are clear that
mandamus only issues when there is a clear legal
duty imposed upon the office or the officer sought
to be compelled to perform an act, and when the
party seeking mandamus has a clear legal right to
the performance of such act.
In the present case, nowhere is it found in
Ordinance No. 8119 or in any law, ordinance, or
rule for that matter, that the construction of a
building outside the Rizal Park is prohibited if the
building is within the background sightline or view
of the Rizal Monument. Thus, there is no legal duty
on the part of the City of Manila "to consider," in
the words of the Dissenting Opinion, "the
standards set under Ordinance No. 8119" in
relation to the applications of DMCI-PDI for the
Torre de Manila since under the ordinance these
standards can never be applied outside the
boundaries of Rizal Park. While the Rizal Park
has been declared a National Historical Site, the
area where Torre de Manila is being built is a
privately-owned property that is "not pap: of the
Rizal Park that has been declared as a National
Heritage Site in 1095," and the Torre de Manila
area is in fact "well-beyond" the Rizal Park,
according to NHCP Chairperson Dr. Maria Serena
I. Diokno. 62 Neither has the area of the Torre de
Manila been designated as a "heritage zone, a
cultural property, a historical landmark or even a
national treasure."63
Also, to declare that the City of Manila failed to
consider the standards under Ordinance No. 8119
would involve making a finding of fact. A finding lot
fact requires notice, hearing, and the submission
of evidence to ascertain compliance with the law or
regulation. In such a case, it is the Regional Trial
Court which has the jurisdiction to hear the case,
receive evidence, make a proper finding of fact, and
determine whether the Torre de Manila project
properly complied with the standards set by the
ordinance. In Meralco v. Public Service
Commission, 64 we held that it is the cardinal right
of a party in trials and administrative proceedings
to be heard, which includes the right of the party
interested or affected to present his own case and
submit evidence in support thereof and to have
such evidence presented considered by the proper
court or tribunal.
To compel the City of Manila to consider the
standards under Ordinance No. 8119 to the Torre
de Manila project will be an empty exercise since
these standards cannot apply outside of the Rizal
Park - and the Torre de Manila is outside the Rizal
Park. Mandamus will lie only if the officials
The KOR also invokes this Court's exercise of its
extraordinary certiorari power of review under
Section 1, Article VIII65 of the Constitution.
However, this Court can only exercise its
extraordinary certiorari power if the City of Manila,
in issuing the required permits and
licenses, gravely abused its discretion
amounting to lack or excess of
jurisdiction. Tellingly, neither the majority nor
minority opinion in this case has found that the
City of Manila committed grave abuse of discretion
in issuing the permits and licenses to DMCI-PDI.
Thus, there is no justification at all for this Court
to exercise its extraordinary certiorari power.
Moreover, the exercise of this Court's
extraordinary certiorari power is limited to actual
cases and controversies that necessarily involve a
violation of the Constitution or the determination
of the constitutionality or validity of a
governmental act or issuance. Specific violation of
a statute that does not raise the issue of
constitutionality or validity of the statute cannot,
as a rule, be the subject of the Court's direct
exercise of its expanded certiorari power. Thus, the
KOR's recourse lies with other judicial remedies or
proceedings allowed under the Rules of Court.
In Association of Medical Clinics for Overseas
Workers, Inc. v. GCC Approved Medical Centers
Association, Inc., 66we held that in cases where the
question of constitutionality of a governmental
action is raised, the judicial power that the courts
exercise is likewise identified as the power of
judicial review - the power to review the
constitutionality of the actions of other branches of
government. As a rule, as required by
the hierarchy of courts principle, these cases are
filed with the lowest court with jurisdiction over
the 1subject matter. The judicial review that the
courts undertake requires:
1) there be an actual case or controversy calling for
the exercise of judicial power;
2) the person challenging the act must have
"standing" to challenge; he must have a personal
and substantial interest in the case such that he
has sustained, or will sustain, direct injury as a
result of its enforcement;
3) the question of constitutionality must be raised
at the earliest possible opportunity; and
4) the issue of constitutionality must be the
very lismota of the case.
The lower court's decision under the constitutional
scheme reaches the Supreme Court through the
appeal process, through a petition for review
on certiorari under Rule 45 of the Rules of Court.
In the present case, the KOR elevated this case
immediately to this Court in an original petition for
injunction which we later on treated as one for
mandamus under Rule 65. There is, however, no
clear legal duty on the City of Manila to consider
the provisions of Ordinance No. 8119 for
applications for permits to build outside the
protected areas of the Rizal Park. Even if there
were such legal duty, the determination of whether
the City of .Manila failed to abide by this legal duty
would involve factual matters which have not been
admitted or established in this case. Establishing
factual matters is not within the realm of this
Court. Findings of fact are the province of the trial
courts.
There is no standard in Ordinance No. 8119 for
defining or determining the background sightline
that is supposed to be protected or that is part of
the "physical integrity" of the Rizal Monument.
How far should a building like the Torre de Manila
be from the Rizal Monument - one, two, three, four,
or five kilometers? Even the Solicitor General,
during the Oral Arguments, conceded that the
ordinance does not prescribe how sightline is
determined, neither is there any way to measure by
metes and bounds whether al construction that
is not part of the historic monument itself or is
outside the protected area can be said to violate
the Rizal Monument's physicalintegrity, except
only to say "when you stand in front of the Rizal
Monument, there can be no doubt that your view is
marred and impaired." This kind of a standard has
no parameters and can include a sightline or a
construction as far as the human eyes can see
when standing in front of the Rizal Monument.
Obviously, this Court cannot apply such a
subjective and non-uniform standard that
adversely affects property rights several kilometers
away from a historical sight or facility.
The Dissenting Opinion claims that "the City, by
reason of a mistaken or erroneous construction of
its own Ordinance, had failed to consider its duties
under [Ordinance No. 8119] when it issued permits
in DMCI-PDI's favor." However, MZBAA Zoning
Board Resolution Nos. 06 and 06-A67 easily dispel
this claim. According to the resolutions, the City of
Manila, through the MZBAA, acted on DMCI-PDI's
application for variance under the powers and
standards set forth in Ordinance No. 8119.
Without further proof that the MZBAA acted
whimsically, capriciously, or arbitrarily in issuing
said resolution, the Court should respect MZBAA's
exercise of discretion. The Court cannot "substitute
its I judgment :for that of said officials who are in a
better position to consider and weigh the same in
the light of the authority specifically vested in them
by law." 68 Since the Court has "no supervisory
power over the proceedings I and actions of the
administrative departments of the government," it
"should not generally interfere with purely
administrative and discretionary functions.; 69 The
power of the Court in mandamus petitions does
not extend "to direct the exercise of judgment or
discretion in a particular way or the retraction
or reversal of an action already taken in the
exercise of either."70
Still, the Dissenting Opinion insists on directing
the re-evaluation by the City of Manila, through
the CPDO, of the permits previously issued in favor
of the Torre de Manila project to determine
compliance with the standards ]under Ordinance
No. 8119. It also declares that the circumstances
in this case warrant the prohacvice conversion of
the proceedings in the issuance of the permits into
a "contested case" necessitating notice and hearing
with all the parties involved.
Prohac vice means a specific decision does not
constitute a precedent because the decision is for
the specific case only, not to be followed in other
cases. A prohac vice decision violates statutory law
- Article 8 of the Civil Code - which states that
"judicial decisions applying or interpreting the laws
or the Constitution shall form part of the legal
system of the Philippines." The decision of the
Court in this case cannot be prohac vice because
by mandate bf the law everydecision of the Court
forms part of the legal system of the Philippines. If
another case comes up with the same facts as the
present case, that case must be decided in the
same way as this case to comply with the
constitutional mandate of equal protection of the
law. Thus, a prohac vice decision also violates the
equal protection clause of the Constitution.
It is the policy of the courts not to interfere with
the discretionary executive acts of the executive
branch unless there is a clear showing of grave
abuse of discretion amounting to lack or excess of
jurisdiction. Mandamus does not lie against the
legislative and executive branches or their
members acting in the exercise of their official
discretionary functions. This emanates from the
respect accorded by the judiciary to said branches
as co-equal entities under the principle of
separation of powers.
In De Castro v. Salas,71 we held that no rule of law
is better established than the one that provides
that mandamus will not issue to control the
discretion of an officer or a court when honestly
exercised and when such power and authority is
not abused.
In exceptional cases, the Court has granted a
prayer for mandamus to compel action in matters
involving judgment and discretion, only "to act, but
not to act lone way or the other," 72 and only in
cases where there has been a clear showing of
grave abuse of discretion, manifest injustice, or
palpable excess of authority.73
In this case, there can be no determination by this
Court that the City of Manila had been negligent or
remiss in its duty under Ordinance No. 8119
considering that this determination will involve
questions of fact. DMCI- PDI had been issued the
proper permits and had secured all approvals and
licenses months before the actual construction
began. Even the KOR could not point to any law
that respondent City of Manila had violated and
could only point to declarations of policies by the
NHCP and the Venice Charter which do not
constitute clear legal bases for the issuance of a
writ of mandam1s.
The Venice Charter is merely a codification of
guiding principles for the preservation and
restoration of ancient monuments, sites, and
buildings. It brings I together principles in the field
of historical conservation and restoration that have
been developed, agreed upon, and and laid down
by experts over the years. Each country, however,
remains "responsible for applying the plan within
the framework of its own culture and traditions."74
The Venice Charter is not a treaty and therefore
does not become enforceable as law. The
Philippines is not legally bound to follow its
directive, as in fact, these are not directives but
mere guidelines - a set of the best practices and
techniques that have been proven over the years to
be the most effective in preserving and restoring
historical monuments, sites and buildings.
The City of Manila concedes that DMCI-PDI's
Zoning Permit was granted without going through
the process under Ordinance No. 8119. However, During the Oral Arguments, it was established that
the same was properly rectified when, faced with the granting of a variance neither uncommon nor
mounting opposition, DMCI-PDI itself sought irregular. On the contrary, current practice has
clarification from the City of Manila and made granting of a variance the rule rather than
immediately began complying with the procedure the exception:
for applying for a variance. The MZBAA did
subsequently recommend the approval of the JUSTICE CARPIO: Let's go to Ordinance 8119. For
variance and the City Council of Manila approved residential condominium that stand alone, in other
the same, ratifying the licenses and permits words not part of a commercial complex or an
already given to DMCI-PDI. Such ratification was industrial complex ...
well within the right of the City Council of Manila.
The City Council of Manila could have denied the ATTY. FLAMINIANO: Yes, Your Honor.
application had it seen any reason to do so. Again,
the ratification is a function of the City Council of
JUSTICE CARPIO: The [Floor Area Ratio (FAR)] is
Manila, an exercise of its discretion1 and well
uniform for the entire City of Manila, the FAR 4,
within the authority granted it by law and the
correct? ATTY. FLAMINIANO: I believe so, Your
City's own Ordinance No. 8119.
Honor, it's FAR 4.
The main purpose of zoning is the protection of
JUSTICE CARPIO: So it's FAR 4 for all residential
public safety, health, convenience, and welfare.
There is no indication that the Torre de Manila condominium complex or industrial projects.
project brings any harm, danger, or hazard to the
people in the surrounding areas except that the ATTY. FLAMINIANO: There might be, the FAR
building allegedly poses an unsightly view on the might be different when it comes to condominiums
taking of photos or the visual appreciation of the in commercial areas, Your Honor.
Rizal Monument by locals and tourists. In fact, the
Court must take the approval of the MZBAA, and JUSTICE CARPIO: Yes, I'm talking of stand-
its subsequent ratification by the City Council of alone ...
Manila, as the duly authorized exercise of
discretion by the city officials. Great care must be ATTY. FLAMINIANO: Yes, Your Honor.
taken that the Court does not unduly tread upon
the local government's performance of its duties. It JUITICE CARPIO: ... residential condominiums...
is not for this Court to dictate upon the other
branches bf the government how their discretion
ATTY. FLAMINIANO: Uniform at FAR 4, Your
must be exercised so long as these branches do not
Honor.
commit grave abuse of discretion amounting to
lack or excess of jurisdiction.
JUSTICE CARPIO: And the percentage of land
occupancy is always 60 percent.
Likewise, any violation of Ordinance No. 8119
must be determined in the proper case and before
the proper forum. It is not within the power of this ATTY. FLAMINIANO: 60 percent correct, Your
Court in this case to make such determination. Honor.
Without such determination, this Court cannot
simply declare that the City of Manila had failed to JUSTICE CARPIO: Okay ... how many square
consider its duties under Ordinance No. 8119 meters is this Torre de Manila?
when it issued the permits in DMCI-PDI's favor
without making a finding of fact how the City of xxx
Manila failed "to consider" its duties with respect to
areas outside the boundaries of the Rizal Park. In ATTY. FLAMINIANO: The land area, Your Honor,
the first place, this Court has no jurisdiction to it's almost 5,000 ... 5,556.
make findings of fact in an original action like this
before this Court. Moreover the City of Manila
JUSTICE CARPIO: So, it's almost half a hectare.
could not legally apply standards to sites outside
the area covered by the ordinance that prescribed
the standards. With this, I taken in light of the lack ATTY. FLAMINIANO: Yes, Your Honor.
of finding that there was grave abuse of discretion I
on the part of the City of Manila, there is no basis JUSTICE CARPIO: And at FAR 4, it can only build
to issue the writ of mandamus against the City of up to 18 storeys, I mean at FAR 4, is that correct?
Manila.
ATTY. FLAMINIANO: If the 60 percent of the lot...
JUSTICE CARPIO: Yes, but that is a rule.
ATTY. FLAMINIANO: That is a rule, that's the rule,
Your Honor.
JUSTICE CARPIO: 60 percent of...
ATTY. FLAMINIANO: Of the land area.
JUSTICE CARPIO: ... buildable, the rest not
buildable.
ATTY. FLAMINIANO: Yes, Your Honor.
JUSTICE CARPIO: Okay, so if you look around
here in the City of Manila anywhere you go, you
look at stand alone residential condominium
buildings...
ATTY. FLAMINIANO: There's a lot of them, Your
Honor.
JUSTICE CARPIO: It's always not FAR 4, it's more
than FAR 4.
ATTY. FLAMINIANO: Yes, Your Honor.
JUSTICE CARPIO: And the buildable area is to the
edge of the property ...it's not 60 percent, correct?
ATTY. FLAMINIANO: Yes, Your Honor.
JUSTICE CARPIO: So, if you look at all the ...
residential buildings in the last ten years, they
[have] all variances. They did not follow the
original FAR 4 or the 60 percent (of land
occupancy). Every residential building that
stand alone was a variance. ATTY.
FLAMINIANO: That's correct, Your Honor.
JUSTICE CARPIO: So the rule really in the City
of Manila is variance, and the exception which
is never followed is FAR 4.
ATTY. FLAMINIANO: FAR 4, it appears to be
that way, Your Honor.
xxxx
JUSTICE CARPIO: Every developer will have to
get a variance because it doesn't make sense to
follow FAR 4 because the land is so expensive
and if you can build only two storeys on a
1,000-square meter lot, you will surely lose
money, correct? ATTY. FLAMINIANO: Exactly,
Your Honor. 75 (Emphasis supplied)
This, the MZBAA's grant of the variance cannot
be used as a basis to grant the mandamus
petition absent any clear finding that said act
amo'1nted to "grave abuse of discretion,
manifest injustice, or palpable excess of
authority."
The KOR is Estopped from Questioning the
Torre de Manila Construction.
The KOR is now estopped from questioning the
construction of the Torre de Manila project. The
KOR itself came up with the idea to build a
structure right behind the Rizal Monument that
would dwarf the Rizal Monument.
In the mid-1950s, the Jose Rizal National
Centennial Commission (JRNCC) l formulated a
plan to build an Educational Center within the
Rizal Park. In July 1955, the KOR proposed the
inclusion of a national theater on the site of the
Educational Center. The JRNCC adopted the
proposal. The following[ year, a law - Republic Act
No. 142776 - authorized the establishment of the
Jose Rizal National Cultural Shrine consisting of a
national theater, a national museum, and a
national library on a single site. 77
To be built on the open space right behind the 12.7
meter high Rizal Monument were: the KOR's
proposed nationaltheater, standing 29.25 meters
high and 286 meters in distance from the Rizal
Monument; the nationallibrary, standing 25 .6
meters high and 180 meters in distance from the
Rizal ;Monument, with its rear along San Luis
Street (now T.M. Kalaw Street); and facing it,
the nationalmuseum, at 19.5 meters high and 190
meters in I distance from the Rizal Monument,
with its back along P. Burgos Street. 78
However, several sectors voiced their objections to
the construction for various reasons. Among them,
the need to preserve the open space of the park,
the high cost of construction, the desecration of
the park's hallowed grounds, and the fact that
the proposed cultural center including the
129.25 meter high national theater proposed by
the KOR would dwarf the 12.7 meter high Rizal
Monument. 79 The JRNCC revised the plan and
only the National Library - which still stands today
- was built. 80
According to the NHCP, the KOR even proposed to
build a Rizal Center on the park as recently as
2013.81 The proposal was disapproved by the
NHCR and the Department of Tourism.
Surely, as noble as the KOR's intentions were, its
proposed center would have dwarfed the Rizal
Monument with its size and proximity.
In contrast, the Torre de Manila is located well
outside the Rizal Park, and to the rear of the Rizal
Monument - approximately 870 meters from the
Rizal Monument and 3 0 meters from the edge of
Rizal Park. 82
It is a basic principle that "one who seeks equity
and justice must come to court with clean hands.
"83 In Jenosa v. Delariarte, 84 the Court reiterated
,that he who seeks equity must do equity, and he
who comes into equity must come with clean
hands. This "signifies that a litigant may be denied
relief by a court of equity on the ground that his
conduct has been inequitable, unfair and
dishonest, or fraudulent, or deceitful as to the
controversy in issue. " 85Thus, the KOR, having
earlier proposed a national theater a mere
286meters in distance from the back of the Rizal
Monument that would have dwarfed the Rizal
Monument, comes to this I Court with unclean
hands. It is now precluded from "seeking any
equitable refuge" 86 from the Court. The KOR's
petition should be dismissed on this ground alone.
Torre de Manila is Not a Nuisance Per Se.
In its petition, the KOR claims that the Torre de
Manila is a nuisance perse that deserves to be
summarily abated even without judicial
proceedings. 87 However, during the Oral
Arguments, counsel for the KOR argued that the
KOR now believes that the Torre de Manila is a
nuisance per accidens and not a nuisance perse. 88
Article 694 of the Civil Code defines a nuisance as
any act, omission, establishment, business,
condition of property, or anything else which: (1)
injures or endangers the health or safety of others;
(2) annoys or offends the senses; (3) shocks, defies
or disregards decency or morality; (4) obstructs or
interferes with the free passage of any public
highway or street, or any body of water; or (5)
hinders or impairs the use of property.
Thy Court recognizes two kinds of nuisances. The
first, nuisance perse, is on "recognized as a
nuisance under any and all circumstances,
because it constitutes a direct menace to public
health or safety, and, for that reason, may be
abated summarily under the undefined law of
necessity." 89 The second, nuisance peraccidens, is
that which "depends upon certain conditions and
circumstances, and its existence being a question
of fact, it cannot be abated without due hearing
thereon in a tribunal authorized to decide whether
such a thing in law constitutes a nuisance. "90
It can easily be gleaned that the Torre de Manila is
not a nuisance per se. The Torre de Manila project
cannot be considered as a "direct menace to I
public health or safety." Not only is a condominium
project commonplace in the City of Manila, DMCI-
PDI has, according to the proper government
agencies, complied with health and safety
standards set by law. DMCI-PDI has been granted
the following permits and clearances prior to
starting the project: (1) Height Clearance Permit
from the Civil Aviation Authority of the
Philippines;91 (2) Development Permit from the
HLURB;92 (3) Zoning Certification from the
HLURB;93 (4) Certificate of Environmental
Compliance Commitment from the Environment
Management Bureau of the Department of
Environment and Natural Resources;94 (5)
Barangay Clearance (6) Zoning Permit;96 (7)
95
Building Permit;97 (8) and Electrical and
Mechanical Permit.98
Later, DMCI-PDI also obtained the right to build
under a variance recommended by the MZBAA and
granted by the City Council of Manila. Thus, there
can be no doubt that the Torre de Manila project is
not a nuisance perse.
On the other hand, the KOR now claims that the
Torre de Manila is a nuisance peraccidens.
By definition, a nuisance peraccidens is
determined based on its surrounding conditions
and circumstances. These conditions and
circumstances must be well established, not
merely alleged. The Court cannot simply accept
these conditions and circumstances as established
facts as the KOR would have us do in this
case. 99 The KOR itself concedes that the question
of whether the Torre de Manila is a
nuisance peraccidens is a question of fact. 100
The authority to decide when a nuisance exists is
an authority to find facts, to estimate their force,
and to apply rules of law to the case thus
made. 101 1lhis Court is no such authority. It is not
a trier of facts. It cannot simply take the
allegations in the petition and accept these as
facts, more so in this case where these allegations
are contested by the respondents.
The task to receive and evaluate evidence is lodged
with the trial courts. The question, then, of
whether the Torre de Manila project is a
nuisance peraccidens must be settled after due
proceedings brought before the proper Regional
Trial Court. The KOR cannot circumvent the
process in the guise be protecting national culture
and heritage.
The TRO must be lifted.
Injunctive reliefs are meant to preserve substantive
rights and prevent further injury102 until final
adjudication on the merits of the case. In the
present case, since the legal rights of the KOR are
not well-defined, clear, and certain, the petition for
mandamus must be dismissed and the TRO lifted.
The general rule is that courts will not disturb the
findings of I administrative agencies when they are
supported by substantial evidence. In this case,
DMCI-PDI already acquired vested rights in the
various permits, licenses, or even variances it had
applied for in order to build a 49-storey building
which is, and had been, allowed by the City of
Manila's zoning ordinance.
As we have time and again held, courts generally
hesitate to review discretionary decisions or
actions of administrative agencies in the absence of
proof that such decisions or actions were arrived at
with grave abuse of discretion amounting to lack or
excess of jurisdiction.
In JRS Business Corp. v. Montesa, 103 we held that
mandamus is the proper remedy if it could be
shown that there was neglect on the part of a
tribunal in the performance of an act which the
law specifically enjoins as a duty, or there was an
unlawful exclusion of a party from the use and
enjoyment be a right to which he is clearly entitled.
Only specific legal rights may be enforced by
mandamus if they are clear and certain. If the legal
rights of th6 petitioner are not well-defined,
definite, clear, and certain, 104 the petition must be
dismissed. Stated otherwise, the writ never issues
in doubtful cases. It neither confers powers nor
imposes duties. It is simply a command to exercise
a power already possessed and to perform a duty
already imposed. 105
In sum, bearing in mind the Court does not
intervene in discretionary acts of the executive
department in the absence of grave abuse of
discretion, 106 and considering that mandamus
may only be issued to enforce a clear and certain
legal right, 107 the present special civil action for
mandamus must be dismissed and the TRO issued
earlier must be lifted.
A FINAL WORD
It had been Rizal’s wish to die facing the rising
sun. In his Mi Ultimo Adios, the poem he left for his
family the night before he was executed, Rizal
wrote:
Yo muero cuando veo que el cielo se colora
Y al fin anuncia el dia tras lobrego capuz 108
[Ako’y mamamatay, ngayong namamalas
na sa Silanganan ay namamanaag
yaong maligayang araw na sisikat
sa likod ng luksang nagtabing na ulap.] 109
[I die just when I see the dawn break,
Through the gloom of night, to herald the day] 110
Yet at the point of his execution, he was made to
stand facing West towards Manila Bay, with his
back to the firing squad, like the traitor the
colonial government wished to portray him. He
asked to face his executioners, facing the East
where the sun would be rising since it was early
morning, but the Spanish captain did not allow it.
As he was shot and a single bullet struck his frail
body, Rizal forced himself, with his last remaining
strength, to turn around to face the East and thus
he fell on his back with] his face to the sky and the
rising sun. Then, the Spanish captain approached
Rizal and finished him off with one pistol shot to
his head.
Before his death, Rizal wrote a letter to his family.
He asked for a simple tomb, marked with a cross
and a stone with only his name and the date of his
birth and death; no anniversary celebrations; and
interment at Paang Bundok(now, the Manila North
Cemetery). Rizal never wanted his grave to be a
burden to future generations.
The letter never made it to his family and his
wishes were not carried out. The letter was
discovered many years later, in 1953. By then, his
remains had been entombed at the Rizal
Monument, countless anniversaries had been .
celebrated, with memorials and monuments built
throughout the world.
Rizal's wish was unmistakable: to be buried
without pomp or pageantry; to the point of
reaching oblivion or obscurity in the future. 111 For
Rizal's life was never about fame or vainglory, but
for the country he loved dearly and for which he
gave up his life.
The Rizal Monument is expressly against Rizal' s
own wishes. That Rizal's statue now stands facing
West towards Manila Bay, with Rizal's back to the
East, adds salt to the wound. If we continue the
present orientation of Rizal's statue, with Rizal
facing West, we would be like the Spanish captain
who refused Rizal's request to die facing the rising
sun in the East. On the other hand, if Rizal' s
statue is made to face East, as Rizal had desired
when he was about to be shot, the background -
the blue sky above Manila Bay - would forever be
clear of obstruction, and we would be faithful to
Rizal's dying wish.
WHEREFORE, the petition for mandamus
is DISMISSED for lack of merit. The Temporary
Restraining Order issued by the Court on 16 June
2015 is LIFTED effective immediately.
SO ORDERED.
G.R. No. L-2929 February 28, 1950
THE CITY OF MANILA, plaintiff-appellant,
vs.
THE ARRELANO LAW COLLEGES,
INC., defendant-appellee.
City Fiscal Eugenio Angeles and Assistant City
Fiscal Arsenio Nañawa for appellant.
Emmanuel Pelaez for appellee.
TUASON, J.:
Section 1 of Republic Act No. 267 provides:
Cities and municipalities are authorized to
contract loans from the Reconstruction
Finance Corporation, the Philippine
National Bank, and/or other entity or
person at the rate of interest not exceeding
eight per cent annum for the purpose of
purchasing or expropriating homesites
within their respective territorial
jurisdiction and reselling them at cost to
residents of the said cities and
municipalities.
The court below ruled that this provision empowers
cities to purchase but not to expropriate lands for
the purpose of subdivision and resale, and so
dismissed the present action, which seeks to
condemn, for the purpose just stated, several
parcels of land having a combined area of 7,270
square meters and situated on Legarda Street, City
of Manila.
In the cases of Guido vs. Rural Progress
Administration (G. R. No. L-
2089)1 and Commonwealth of the Philippines vs. De
Borja (G. R. No. L-1496),2 we discussed at great
length the extent of the Philippine Government's
power to condemn private property for resale.
Among other things, we said:
It has been truly said that the assertion of
the right on the part of the legislature to
take the property of one 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 every just principle
and fundamental maxim of a free
government. (29 C. J. S., 820.)
In a broad sense, expropriation of large
estates, trusts in perpetuity, and land that
embraces a whole town, or 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, endless conflicts between
landlords and tenants, 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 applied in determining whether
the use is public or not, some go so far in
the direction of a liberal construction as to
hold that public use is synonymous with
public benefit, public utility, or 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 of considerable
magnitude. (29 C. J. S.; 823, 824; see also
People of Puerto Rico vs. Eastern Sugar
Associate et al., 156 Fed. [2d], 316.) In
some instances, slumsites have been
acquired by condemnation. The highest
court of New York State has ruled that slum
clearance and erection of houses for low-
income families were public purpose 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
unsanitary dwellings diminished the
potentialities of epidemics, crime and
waste, prevents the spread of crime and
diseases to unaffected areas, enhances the
physical and moral value of the
surrounding communities, and promote the
safety and welfare of the public in general.
(Murray et al. vs. La Guardia, 52 N. e. [2d],
884; General Development Coop. vs. City of
Detroit, 33 N. W. [2d], 919; Weizner vs.
Stichman, 64 N. Y. S. [2d], 50.) But it will
be noted that in all these cases and 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 insure 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 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 sacrifices 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
made; each case has to be judged 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 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 and
area of 1,000 or 2,000 square meters for
subdivision into tiny lots for resale to its
occupations or those who want to build
thereon.
We are inclined to believe that Act No. 267
empowers cities to expropriate as well as to
purchase lands for homesites. The word
"expropriating," taken singly or with the text, is
susceptible of only meaning. But this power to
expropriate is necessarily subject to the limitations
and conditions noted in the decisions above cited.
The National Government may not confer its
instrumentalities authority which itself may not
exercise. A stream can not run higher than its
source.
Viewed from another angle, the case at bar is
weaker for the condemnor. In the first place, the
land that is the subject of the present
expropriation is only one-third of the land sought
to be taken in the Guido case, and about two-
thirds of that involved in the Borja condemnation
proceeding. In the second place, the Arellano
Colleges' land is situated in a highly commercial
section of the city and is occupied by persons who
are not bona fide tenants. Lastly, this land was
brought by the defendant for a university site to
take the place of rented buildings that are
unsuitable for schools of higher learning.
To authorize the condemnation of any particular
land by a grantee of the power of eminent domain,
a necessity must exist for the taking thereof for the
proposed uses and purposes. (29 C. J. S., 884-
885.) In City of Manila vs. Manila Chinese
Community (40 Phil., 349), this Court, citing
American decision, laid done this rule:
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.)
And this passage in Blackstone's Commentaries on
the English Law is cited in that decision: "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 exist a very great
necessity thereof."
Perhaps modern decisions are not so exigent.
Necessity within the rule that the particular
property to be expropriated must be necessary.
does not mean an absolute but only a reasonable
or practical necessity, such as would combine the
greatest benefit to the public with the least
inconvenience and expense to the condemning
party and property owner consistent with such
benefits. (29 C. J. S., 386.) But measured even by
this standard, and forgetting for a moment the
private character of the intended use, necessity for
the condemnation has not been shown. The land in
question has cost the owner P140,000. The people
for whose benefit the condemnation is being
undertaken are so poor they could ill afford to meet
this high price, unless they intend to borrow the
money with a view to disposing of the property
later for a profits. Cheaper lands not dedicated to a
purpose so worthy as a school and more suited to
the occupants' needs and means, if really they only
want to own their own homes, are plenty
elsewhere. On the other hand, the defendant not
only has invested a considerable amount for its
property but had the plans for construction ready
and would have completed the project a long time
ago had it not been stopped by the city authorities.
And again, while a handful of people stand to
profits by the expropriation, the development of a
university that has a present enrollment of 9,000
students would be sacrificed. Any good that would
accrue to the public from providing homes to a few
families fades into insignificance in comparison
with the preparation of a young men and young
women for useful citizenship and for service to the
government and the community, a task which the
government alone is not in a position to undertake.
As the Rural Progress Administration, the national
agency lands for resale as homesites and to which
the petition to purchase the land in question on
behalf of the occupants was referred by the
President, turning down the occupants request
after proper investigation, commented that "the
necessity of the Arellano Law College to acquire a
permanent site of its own is imperative not only
because denial of the same would hamper the
objectives of that educational institution, but it
would likewise be taking a property intended
already for public benefit." The Mayor of the City of
Manila himself confessed that he believes the
plaintiff is entitled to keep this land.
The order of the Court of First Instance of Manila is
affirmed without costs.
City of Manila v. Arellano
TUASON, J.:
Section 1 of Republic Act No. 267 provides:
"Cities and municipalities are authorized to
contract loans from the Reconstruction Pi-nance
Corporation, the Philippine National Bank, and/or
any other entity or person at a rate of interest not
exceeding eight per cent per annum for the
purpose of purchasing or expropriating homesites
within their respective territorial jurisdiction and
reselling them at cost to residents of the said cities
and municipalities."
The court below ruled that this provision empowers
cities to purchase but not to expropriate lands for
the purpose of subdivision and resale, and so
dismissed the present action, which seeks to
condemn, for the purpose just stated, several
parcels of land having a combined area of 7270
square meters and situated on Legarda Street, City
of Manila.
In the cases of Guide vs. Rural Progress
Administration, (G. R. No. L-2089), [1] and
Commonwealth of the Philippines vs. Borja, (G. R.
No. L-1496),[2] we discussed at great length the
extent of the Philippine Government's power to
condemn private property for resale. Among other
things, we said:
"It has been truly said that the assertion of the
right on the part of the legislature to take the
property of one 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 every
just principle and fundamental maxim of a free
government. (29 G.J.S. 820.)
"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,
endless conflicts between landlords and tenants,
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 so far in the direction of a
liberal construction as to hold that public use is
synonymous with public benefit, public utility, or
public advantage, and to authorize the exercise of
the power of eminent domain to promote such
public benefit, etc., especially where the interests
involved are of considerable magnitude. (29 C.J.S.
823, 82; see also People of Puerto Rico vs. Eastern
Sugar Associates et al, 156 Fed. [2d] 316.) In some
instances, slumsites have been, acquired by
condemnation. The highest court of New York State
has ruled that slum clearance and erection 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 epidemics; 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 fit al. vs. La
Guardia, 52 N.E. [2d] 884; General Development
Coop. vs. City of Detroit, 33 N.W. [2d] 919;
Weizner vs. Stichman, 64 N. Y. S. [2d] 50.) But it
will be noted that in all these "cases 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 judged 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.
We are inclined to believe that Act No. 267
empowers cities to expropriate as well as to
purchase lands for homesites. The word
"expropriating", taken singly or the text, is
susceptible of only one meaning. But this power to
expropriate is necessarily subject to the limitations
and conditions noted in the decisions above cited.
The National Government nay not confer upon its
instrumentalities authority which it itself may not
exercise. A stream can not run higher than its
source.
Viewed from another angle, the case at bar is we
alter for the condemnor. In the first place, the land
that is the subject of the present expropriation is
only one-third of the land sought to be taken in the
Guido case, and about two-thirds of that involved
in the Borja condemnation proceeding. In the
second place, the Arellano Colleges' land is
situated in a highly commercial section of the city
and is occupied by persons who are not bona fide,
tenants. Lastly, this land was bought by the
defendant for a university site to take the place of
rented buildings that are unsuitable for schools of
higher learning.
To authorize the condemnation of any particular
land by a grantee of the power of eminent domain,
a necessity must exist for the taking thereof for the
proposed uses and purposes. (29 C. J. S. 884-885.)
In City of Manila vs. Manila Chinese Community,
(40 Phil., 349), this court, citing American
decisions, laid down this rule:
"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.)"
And this passage in Blackstone's Commentaries on
the English Law is cited in that decisions "80 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 thereof."
Perhaps modern decisions are not so exigent.
Necessity within the rule that the particular
property to be expropriated must be necessary,
does not mean an. absolute but only a reasonable
or practical necessity, such as would combine the
greatest benefit to the public with the least
inconvenience and expense to the condemning
party and property owner consistent with such
benefit, (29 C. T. S. 386.) But. measured even by
this standard, and forgetting for a moment the
private character of the intended use, necessity for
the condemnation has not been shown. The land in
question has cost, the owner P140,000. The people
for whose benefit the condemnation is being
undertaken are so poor they could ill afford to meet
this high price, unless they intend to borrow the
money with a view to disposing of the property
later for a profit. Cheaper lands not dedicated to a
purpose so worthy as a school and more suited to
the occupants' needs and means, if really they only
want to own their own homes, are aplenty
elsewhere. On the other hand, the defendant not
only has invested a considerable amount for its
property but had the plans for construction ready
and would have completed the project a long time
ago had it not been stopped by the city authorities.
And again, while a handful of people stand to profit
by the expropriation, the development of a
university that has a present enrollment of 9j000
students would be sacrificed. Any good that would
accrue to the public from providing homes to a few
families fades into insignificance in comparison
with the preparation of young men and young
women for useful citizenship and for service to the
government and the community, a task which the
government alone is not in a position to undertake.
As the Rural Progress Administration, the national
agency created by the Government to purchase or
expropriate lands for resale as homesites, and to
which the petition to purchase the land in question
on behalf of the occupants was referred by the
President, turned down the occupants' request
after proper investigation, commenting that "the
Per its October 19, 2005 Resolution, the Court
necessity of the Arellano Law College to acquire a
permanent site of its own is imperative not only ordered the consolidation of both cases.
because denial of the same would hamper the
objectives of that educational institution, but it
would likewise be taking a property intended Except for the names of the parties and the specific
already for public benefit." The Mayor of the City of
Manila himself confessed that he believes the lot designation involved, the relevant factual
plaintiff is entitled to keep this land. antecedents which gave rise to these consolidated
The order of the Court of First Instance of Manila is petitions are, for the most part, as set forth in the
affirmed without costs.
Courts Decision[4] of October 15, 2003, as
[5]
reiterated in a Resolution dated August 9, 2005,
GR No. 168770
VELASCO, JR., J.: in G.R. No. 156273 entitled Heirs of Timoteo
#6 case Moreno and Maria Rotea v. Mactan-Cebu
International Airport Authority (Heirs of
At the center of these two (2) Petitions for Review
[6]
Moreno), and in other earlier related cases.
on Certiorari under Rule 45 is the issue of the right
of the former owners of lots acquired for the
In 1949, the National Airport Corporation
expansion of the Lahug Airport in CebuCity to
(NAC), MCIAAs predecessor agency, pursued a
repurchase or secure reconveyance of their
program to expand
respective properties.
the Lahug Airport in Cebu City. Through its team
of negotiators, NAC met and negotiated with the
In the first petition, docketed as G.R. No.
owners of the properties situated around the
168770, petitioners Anunciacion vda. de Ouano,
airport, which included Lot Nos. 744-A, 745-A,
Mario Ouano, Leticia Ouano Arnaiz and Cielo
746, 747, 761-A, 762-A, 763-A, 942, and 947 of
Ouano Martinez (the Ouanos) seek to nullify the
the Banilad Estate. As the landowners would later
Decision[1] dated September 3, 2004 of the Court of
claim, the government negotiating team, as a
Appeals (CA) in CA-G.R. CV No. 78027, affirming
sweetener, assured them that they could
the Order dated December 9, 2002 of the Regional
repurchase their respective lands should
Trial Court (RTC), Branch 57 in Cebu City, in Civil
the Lahug Airportexpansion project do not push
Case No. CEB-20743, a suit to compel the
through or once the Lahug Airport closes or its
Republic of the Philippines and/or the Mactan-
operations transferred to Mactan-Cebu Airport.
Cebu International Airport Authority (MCIAA) to
Some of the landowners accepted the assurance
reconvey to the Ouanos a parcel of land.
and executed deeds of sale with a right of
repurchase. Others, however, including the owners
The second petition, docketed as G.R. No. 168812,
of the aforementioned lots, refused to sell because
has the MCIAA seeking principally to annul and set
the purchase price offered was viewed as way
aside the Decision[2] and Resolution[3] dated
below market, forcing the hand of the Republic,
January 14, 2005 and June 29, 2005, respectively,
represented by the then Civil Aeronautics
of the CA in CA-G.R. CV No. 64356, sustaining the
Administration (CAA), as successor agency of the
RTC, Branch 13 in Cebu City in its Decision of
NAC, to file a complaint for the expropriation of Lot
October 7, 1988 in Civil Case No. CEB-18370.
Nos. 744-A, 745-A, 746, 747, 761-A, 762-A, 763-A,
942, and 947, among others, docketed as Civil
Case No. R-1881 entitled Republic v. Damian commercial flights. On the ground, the
Ouano, et al. expropriated lots were never utilized for the
purpose they were taken as no expansion
On December 29, 1961, the then Court of
of Lahug Airport was undertaken. This
First Instance (CFI) of Cebu rendered judgment for
development prompted the former lot owners to
the Republic, disposing, in part, as follows:
formally demand from the government that they be
allowed to exercise their promised right to
IN VIEW OF THE FOREGOING, judgment is
hereby rendered: repurchase. The demands went unheeded. Civil

1. Declaring the expropriation of suits followed.

Lots Nos. 75, 76, 76, 89, 90, 91, 92,
105, 106, 107, 108, 104, 921-A, 88,
93, 913-B, 72, 77, 916, 777-A, 918, G.R. No. 168812 (MCIAA Petition)
919, 920, 764-A, 988, 744-A, 745-A,
746, 747, 762-A, 763-A, 951, 942,
720-A, x x x and 947, included in On February 8, 1996, Ricardo L. Inocian and four
the Lahug Airport, Cebu City, others (all children of Isabel Limbaga who
justified in and in lawful exercise of
the right of eminent domain. originally owned six [6] of the lots expropriated);
and Aletha Suico Magat and seven others,

xxxx successors-in-interest of Santiago Suico, the

3. After the payment of the foregoing original owner of two (2) of the condemned lots
financial obligation to the
landowners, directing the latter to (collectively, the Inocians), filed before the RTC in
deliver to the plaintiff the Cebu City a complaint for reconveyance of
corresponding Transfer Certificates
of Title to their respective lots; and real properties and damages against MCIAA. The
upon the presentation of the said
complaint, docketed as Civil Case No. CEB-
titles to the Register of Deeds,
ordering the latter to cancel the 18370, was eventually raffled to Branch 13 of the
same and to issue, in lieu thereof,
court.
new Transfer Certificates of Title in
the name of the plaintiff.[7]

On September 29, 1997, one Albert Chiongbian

In view of the adverted buy-back assurance (Chiongbian), alleging to be the owner of Lot Nos.
made by the government, the owners of the lots no 761-A and 762-A but which the Inocians were now
longer appealed the decision of the trial court. claiming, moved and was later allowed to
[8]
Following the finality of the judgment of intervene.
condemnation, certificates of title for the covered
parcels of land were issued in the name of the
Republic which, pursuant to Republic Act No. During the pre-trial, MCIAA admitted the following

6958,[9] were subsequently transferred to MCIAA. facts:

1. That the properties,

At the end of 1991, or soon after the transfer of the
which are the subject matter of Civil
aforesaid lots to MCIAA, Lahug Airport completely Case No. CEB-18370, are also the
properties involved in Civil Case R-
ceased operations, Mactan Airport having opened
1881;
to accommodate incoming and outgoing
 2. That the purpose of
the expropriation was for the
expansion of the old Lahug Airport;
that the Lahug Airport was not
expanded;
3. That the
old Lahug Airport was closed
sometime in June 1992;
4. That the price paid to
the lot owners in the expropriation
case is found in the decision of the
court; and
5. That some properties
were reconveyed by the MCIAA
because the previous owners were
able to secure express waivers or
riders wherein the government
agreed to return the properties
should the expansion of
the Lahug Airport not materialize.
During trial, the Inocians adduced evidence
which included the testimony of Ricardo Inocian
(Inocian) and Asterio Uy (Uy). Uy, an employee of
the CAA, testified that he was a member of the
team which negotiated for the acquisition of certain
lots in Lahug for the proposed expansion of
the Lahug Airport. He recalled that he acted as
the interpreter/spokesman of the team since
he could speak the Cebuano dialect. He stated that
the other members of the team of negotiators were
Atty. Pedro Ocampo, Atty. Lansang, and Atty.
Saligumba. He recounted that, in the course of the
negotiation, their team assured the landowners
that their landholdings would be reconveyed to
them in the event the Lahug Airport would be
abandoned or if its operation were transferred to
the Mactan Airport. Some landowners opted to sell,
while others were of a different bent owing to the
inadequacy of the offered price.
Inocian testified that he and his mother,
Isabel Lambaga, attended a meeting called by the
NAC team of negotiators sometime in 1947 or 1949
where he and the other landowners were given the
assurance that they could repurchase their lands
at the same price in the event
the Lahug Airport ceases to operate. He further
testified that they rejected the NACs offer. However,
he said that they no longer appealed the decree of
expropriation due to the repurchase assurance
adverted to.
The MCIAA presented Michael Bacarizas
(Bacarizas), who started working for MCIAA as
legal assistant in 1996. He testified that, in the
course of doing research work on the lots subject
of Civil Case No. CEB-18370, he discovered that
the same lots were covered by the decision in Civil
Case No. R-1881. He also found out that the said
decision did not expressly contain any condition on
the matter of repurchase.
Ruling of the RTC
On October 7, 1998, the RTC rendered a
Decision in Civil Case No. CEB-18370, the
dispositive portion of which reads as follows:
WHEREFORE, in view of the
foregoing, judgment is hereby
rendered directing defendant
Mactan Cebu International Airport
Authority (MCIAA) to reconvey (free
from liens and encumbrances) to
plaintiffs Ricardo Inocian, Olimpia
E. Esteves, Emilia E. Bacalla,
Restituta E. Montana and Raul
Inocian Lots No. 744-A, 745-A, 746,
762-A, 747, 761-A and to plaintiffs
Aletha Suico Magat, Philip M. Suico,
Doris S. dela Cruz, James M. Suico,
Edward M. Suico, Roselyn S.
Lawsin, Rex M. Suico and Kharla
Suico-Gutierrez Lots No. 942 and
947, after plaintiffs shall have paid
MCIAA the sums indicated in the
decision in Civil Case No. R-1881.
Defendant MCIAA is likewise
 directed to pay the aforementioned
then the owners of the lots expropriated may, if so
plaintiffs the sum or P50,000.00 as
and for attorneys fees and minded, demand of MCIAA to make good its verbal
P10,000.00 for litigation expenses.
assurance to allow the repurchase of the
Albert Chiongbians properties. To the CA, this assurance, a
intervention should be, as it is
hereby DENIED for utter lack of demandable agreement of repurchase by itself, has
factual basis. been adequately established.
With costs against defendant
MCIAA.[10]
On September 21, 2005, the MCIAA filed with Us a

Therefrom, MCIAA went to the CA on petition for review of the CAs Decision, docketed as

appeal, docketed as CA-G.R. CV No. 64356. G.R. No. 168812.

Ruling of the CA
G.R. No. 168770 (Ouano Petition)

On January 14, 2005, the CA rendered Soon after the MCIAA jettisoned
judgment for the Inocians, declaring them entitled the Lahug Airport expansion project, informal
to the reconveyance of the questioned lots as the settlers entered and occupied Lot No. 763-A which,
successors-in-interest of the late Isabel Limbaga before its expropriation, belonged to the
and Santiago Suico, as the case may be, who were Ouanos. The Ouanos then formally asked to be
the former registered owners of the said lots. The allowed to exercise their right to repurchase the
decretal portion of the CAs Decision reads: aforementioned lot, but the MCIAA ignored the
demand. On August 18, 1997, the Ouanos
WHEREFORE, in view of the instituted a complaint before the Cebu City RTC
foregoing premises, judgment is
hereby rendered by against the Republic and the MCIAA for
us DISMISSING the appeal filed in reconveyance, docketed as Civil Case No. CEB-
this case and AFFFIRMING the
decision rendered by the court a quo 20743.
on October 7, 1998 in Civil Case No.
CEB-18370.
Answering, the Republic and MCIAA
SO ORDERED.
averred that the Ouanos no longer have
enforceable rights whatsoever over the condemned
The CA, citing and reproducing excerpts Lot No. 763-A, the decision in Civil Case No. R-
from Heirs of Moreno,[11] virtually held that the 1881 not having found any reversionary condition.
decision in Civil Case No. R-1881 was conditional,
stating that the expropriation of [plaintiff- Ruling of the RTC
appellees] lots for the proposed expansion of the
Lahug Airport was ordered by the CFI of Cebu By a Decision dated November 28, 2000,
under the impression that Lahug Airport would the RTC, Branch 57 in Cebu City ruled in favor of
continue in operation.[12] The condition, as may be the Ouanos, disposing as follows:
deduced from the CFIs decision, was that should
MCIAA, or its precursor agency, discontinue WHEREFORE, in the light of the
foregoing, the Court hereby renders
altogether with the operation of Lahug Airport, judgment in favor of the plaintiffs,
 Anunciacion Vda. De Ouano, Mario
P. Ouano, Leticia Ouano Arnaiz and
Cielo Ouano Martinez and against
Explaining its case disposition, the CA stated that
the Republic of the Philippines and
Mactan Cebu International Airport the decision in Civil Case No. R-1881 did not state
Authority (MCIAA) to restore to
plaintiffs, the possession and any condition that Lot No. 763-A of the Ouanosand
ownership of their land, Lot No. all covered lots for that matterwould be returned to
763-A upon payment of the
expropriation price to defendants; them or that they could repurchase the same
and property if it were to be used for purposes other

2. Ordering the Register of Deeds to than for the Lahug Airport. The appellate court
effect the transfer of the Certificate also went on to declare the inapplicability of the
of Title from defendant Republic of
the Philippines on Lot 763-A, Courts pronouncement in MCIAA v. Court of
canceling TCT No. 52004 in the Appeals, RTC, Branch 9, Cebu City, Melba Limbago,
name of defendant Republic of the
Philippines and to issue a new title et al.,[16] to support the Ouanos cause, since the
on the same lot in the names of affected landowners in that case, unlike the
Anunciacion Vda. De Ouano, Mario
P. Ouano, Leticia Ouano Arnaiz and Ouanos, parted with their property not through
Cielo Ouano Martinez.
expropriation but via a sale and purchase
No pronouncement as to costs. [13]
transaction.

Acting on the motion of the Republic and MCIAA

The Ouanos filed a motion for
for reconsideration, however, the RTC, Branch 57
reconsideration of the CAs Decision, but was
in Cebu City, presided this time by Judge
denied per the CAs May 26, 2005 Resolution.
Enriqueta L. Belarmino, issued, on December 9,
[17]
Hence, they filed this petition in G.R. No.
2002, an Order[14] that reversed its earlier decision
168770.
of November 28, 2000 and dismissed the Ouanos
complaint.

The Issues
Ruling of the CA

G.R. No. 168812

In time, the Ouanos interposed an appeal to the GROUNDS FOR ALLOWANCE OF
THE PETITION
CA, docketed as CA-G.R. CV No. 78027.
Eventually, the appellate court rendered a l. THE ASSAILED
ISSUANCES ILLEGALLY STRIPPED
Decision[15] dated September 3, 2004, denying the THE REPUBLIC OF ITS ABSOLUTE
appeal, thus: AND UNCONDITIONAL TITLE TO
THE SUBJECT EXPROPRIATED
PROPERTIES.
WHEREFORE, premises considered,
the Order dated December 9, 2002, ll. THE IMPUNGED
of the Regional Trial Court, DISPOSITIONS INVALIDLY
7th Judicial Region, Branch OVERTURNED THIS HONORABLE
57, Cebu City, in Civil Case No. COURTS FINAL RULINGS IN FERY
CEB-20743, is hereby V. MUNICIPALITY OF
AFFIRMED. No pronouncement as CABANATUAN, MCIAA V. COURT
to costs. OF APPEALS AND REYES V.
NATIONAL HOUSING AUTHORITY.
SO ORDERED.
 lll. THE COURT OF APPEALS I
GRAVELY ERRED IN APPLYING WHETHER ABANDONMENT OF
THIS HONORABLE COURTS THE PUBLIC USE FOR WHICH THE
RULING IN MORENO, ALBEIT IT SUBJECT PROPERTIES WERE
HAS NOT YET ATTAINED EXPROPRIATED ENTITLES
FINALITY.[18] PETITIONERS OUANOS, ET AL.
AND RESPONDENTS INOCIAN, ET
G.R. No. 168770 AL. TO REACQUIRE THEM.

Questions of law presented in this II

Petition
WHETHER PETITIONERS OUANOS,
Whether or not the testimonial ET AL. AND RESPONDENTS
evidence of the petitioners proving INOCIAN, ET AL. ARE ENTITLED TO
the promises, assurances and RECONVEYANCE OF THE
representations by the airport SUBJECT PROPERTIES SIMPLY ON
officials and lawyers are THE BASIS OF AN ALLEGED
inadmissbale under the Statute of VERBAL PROMISE OR ASSURANCE
Frauds. OF SOME NAC OFFICIALS THAT
THE SUBJECT PROPERTIES WILL
Whether or not under the ruling of BE RETUNRED IF THE AIRPORT
this Honorable Court in the heirs of PROJECT WOULD BE
Moreno Case, and pursuant to the ABANDONED.
principles enunciated therein,
petitioners herein are entitiled to
recover their litigated property.
The Courts Ruling
Reasons for Allowances of this
Petition
The Republic and MCIAAs petition in G.R. No.
Respondents did not object during 168812 is bereft of merit, while the Ouano petition
trial to the admissibility of
petitioners testimonial evidence in G.R. No. 168770 is meritorious.
under the Statute of Frauds and
have thus waived such objection
and are now barred from raising the At the outset, three (3) fairly established factual
same. In any event, the Statute of premises ought to be emphasized:
Frauds is not applicable herein.
Consequently, petitioners evidence
is admissible and should be duly First, the MCIAA and/or its predecessor agency
given weight and credence, as
initially held by the trial court in its had not actually used the lots subject of the final
original Decision.[19] decree of expropriation in Civil Case No. R-1881 for
the purpose they were originally taken by the
While their respective actions against MCIAA below government, i.e., for the expansion and
ended differently, the Ouanos and the Inocians development of Lahug Airport.
proffered arguments presented before this Court
run along parallel lines, both asserting entitlement Second, the Lahug Airport had been closed
to recover the litigated property on the strength of and abandoned. A significant portion of it had, in
the Courts ruling in Heirs of Moreno. MCIAA has, fact, been purchased by a private corporation for
however, formulated in its Consolidated development as a commercial complex.[20]
Memorandum the key interrelated issues in these
consolidated cases, as follows: Third, it has been preponderantly
established by evidence that the NAC, through its
 judgment of condemnation if the
team of negotiators, had given assurance to the
right of repurchase was extended to
affected landowners that they would be entitled to them. A handful failed to prove that
they acted on such assurance when
repurchase their respective lots in the event they they parted with ownership of their
are no longer used for airport purposes. [21] No less land.[25](Emphasis supplied;
citations omitted.)
than Asterio Uy, the Court noted in Heirs of
Moreno, one of the members of the CAA Mactan
Legal Team, which interceded for the acquisition of For perspective, Heirs of Morenolater followed
the lots for the Lahug Airports expansion, affirmed by MCIAA v. Tudtud (Tudtud)[26] and the
that persistent assurances were given to the consolidated cases at baris cast under the same
landowners to the effect that as soon as the Lahug factual setting and centered on the expropriation of
Airport is abandoned or transferred to Mactan, the privately-owned lots for the public purpose of
lot owners would be able to reacquire their expanding the Lahug Airport and the alleged
properties.[22] In Civil Case No. CEB-20743, Exhibit promise of reconveyance given by the negotiating
[23]
G, the transcript of the deposition of NAC officials to the private lot owners.All the lots
Anunciacion vda. de Ouano covering the assurance being claimed by the former owners or successors-
made had been formally offered in evidence and in-interest of the former owners in the Heirs of
duly considered in the initial decision of Moreno, Tudtud, and the present cases were
the RTC Cebu City. In Civil Case No. CEB-18370, similarly adjudged condemned in favor of the
the trial court, on the basis of testimonial evidence, Republic in Civil Case No. R-1881. All the
and later the CA, recognized the reversionary claimants sought was or is to have the condemned
rights of the suing former lot owners or their lots reconveyed to them upon the payment of the
[24]
successors in interest and resolved the case condemnation price since the public purpose of
accordingly. In point with respect to the the expropriation was never met. Indeed, the
representation and promise of the government to expropriated lots were never used and were, in
return the lots taken should the planned airport fact, abandoned by the expropriating government
expansion do not materialize is what the Court agencies.
said in Heirs of Moreno, thus: In all then, the issues and supporting
This is a difficult case calling
for a difficult but just solution. To arguments presented by both sets of petitioners in
begin with there exists these consolidated cases have already previously
an undeniable historical
narrative that the predecessors of been passed upon, discussed at length, and
respondent MCIAA had suggested to
practically peremptorily resolved in Heirs of
the landowners of the properties
covered by the Lahug Airport Moreno and the November 2008 Tudtud ruling. The
expansion scheme that they could
Ouanos, as petitioners in G.R. No. 168770, and the
repurchase their properties at the
termination of the airports Inocians, as respondents in G.R. No. 168812, are
venue. Some acted on this
assurance and sold their properties; similarly situated as the heirs of Moreno in Heirs of
other landowners held out and Moreno and Benjamin Tudtud in Tudtud. Be that
waited for the exercise of eminent
domain to take its course until as it may, there is no reason why the ratio
finally coming to terms with decidendi in Heirs of Morenoand Tudtud should not
respondents predecessors that they
would not appeal nor block further be made to apply to petitioners Ouanos and
respondents Inocians such that they shall be v. Poncio, et al., quoting Chief Justice Moran,
entitled to recover their or their predecessors explains the rationale behind this rule, thusly:
respective properties under the same manner and
x x x The reason is simple. In
arrangement as the heirs of Moreno and
executory contracts there is a wide
Tudtud. Stare decisis et non quieta movere (to field for fraud because unless they
may be in writing there is no
adhere to precedents, and not to unsettle things palpable evidence of the intention of
which are established).[27] the contracting parties. The statute
has been precisely been enacted to
prevent fraud. x x x However, if a
contract has been totally or partially
Just like in Tudtud and earlier in Heirs of Moreno, performed, the exclusion of parol
MCIAA would foist the theory that the judgment of evidence would promote fraud or bad
faith, for it would enable the
condemnation in Civil Case No. R-1881 was defendant to keep the benefits
without qualification and was unconditional. It already derived by him from the
transaction in litigation, and at the
would, in fact, draw attention to the fallo of the same time, evade the obligations,
expropriation courts decision to prove that there is responsibilities or liabilities
assumed or contracted by him
nothing in the decision indicating that the thereby.[30] (Emphasis in the
original.)
government gave assurance or undertook to
reconvey the covered lots in case the Lahug airport
expansion project is aborted. Elaborating on this Analyzing the situation of the cases at bar,
angle, MCIAA argues that the claim of the Ouanos there can be no serious objection to the proposition
and the Inocians regarding the alleged verbal that the agreement package between the
assurance of the NAC negotiating team that they government and the private lot owners was already
can reacquire their landholdings is barred by the partially performed by the government through the
[28]
Statute of Frauds. acquisition of the lots for the expansion of the
Lahug airport. The parties, however, failed to
Under the rule on the Statute of Frauds, as accomplish the more important condition in the
expressed in Article 1403 of the Civil Code, a CFI decision decreeing the expropriation of the lots
contract for the sale or acquisition of real property litigated upon: the expansion of the Lahug Airport.
shall be unenforceable unless the same or some The projectthe public purpose behind the forced
note of the contract be in writing and subscribed property takingwas, in fact, never pursued and, as
by the party charged. Subject to defined a consequence, the lots expropriated were
exceptions, evidence of the agreement cannot be abandoned. Be that as it may, the two groups of
received without the writing, or secondary evidence landowners can, in an action to compel MCIAA to
of its contents. make good its oral undertaking to allow
repurchase, adduce parol evidence to prove the
MCIAAs invocation of the Statute of Frauds transaction.
is misplaced primarily because the statute applies
only to executory and not to completed, executed, At any rate, the objection on the
[29]
or partially consummated contracts. Carbonnel admissibility of evidence on the basis of the Statute
of Frauds may be waived if not timely raised.
Records tend to support the conclusion that
MCIAA did not, as the Ouanos and the Inocians
posit, object to the introduction of parol evidence
to prove its commitment to allow the former
landowners to repurchase their respective
properties upon the occurrence of certain events.
In a bid to deny the lot owners the right to
repurchase, MCIAA, citing cases,[31] points to the
dispositive part of the decision in Civil Case R-
1881 which, as couched, granted the Republic
absolute title to the parcels of land declared
expropriated. The MCIAA is correct about the
unconditional tone of the dispositive portion of the
decision, but that actuality would not carry the day
for the agency. Addressing the matter of the
otherwise absolute tenor of the CFIs disposition in
Civil Case No. R-1881, the Court, in Heirs of
Moreno, after taking stock of the ensuing portion of
the body of the CFIs decision, said:
As for the public purpose of the
expropriation proceeding, it cannot
now be
doubted. Although Mactan Airport is
being constructed, it does not take
away the actual usefulness and
importance of the LahugAirport: it is
handling the air traffic of both
civilian and military. From it
aircrafts fly to Mindanao and
Visayas and pass thru it on their
flights to the North
and Manila. Then, no evidence was
adduced to show how soon is
the Mactan Airport to be placed in
operation and whether
the Lahug Airport will be closed
immediately thereafter. It is up to
the other departments of the
Government to determine said
matters. The Court cannot
substitute its judgments for those of
the said departments or agencies. In
the absence of such showing, the
court will presume that
the Lahug Airport will continue to
be in operation.[32] (Emphasis
supplied.)
We went on to state as follows:
While the trial court in Civil Case
No. R-1881 could have simply
acknowledged the presence of public
purpose for the exercise of eminent
domain regardless of the survival of
the Lahug Airport, the trial court in
its Decision chose not to do so but
instead prefixed its finding of public
purpose upon its understanding
that Lahug Airport will continue to be
in operation. Verily, these
meaningful statements in the body
of the Decision warrant the
conclusion that the expropriated
properties would remain to be so
until it was confirmed
that Lahug Airport was no longer in
operation. This inference further
implies two (2) things: (a) after the
Lahug Airport ceased its
undertaking as such and the
expropriated lots were not being
used for any airport expansion
project, the rights vis--vis the
expropriated lots x x x as between
the State and their former owners,
petitioners herein, must be
equitably adjusted; and (b) the
foregoing unmistakable declarations
in the body of the Decision should
merge with and become an intrinsic
part of the fallo thereof which under
the premises is clearly inadequate
since the dispositive portion is not
in accord with the findings as
contained in the body thereof.[33]
Not to be overlooked of course is what the
Court said in its Resolution disposing of MCIAAs
motion to reconsider the original ruling in Heirs
of Moreno. In that resolution, We stated that
the fallo of the decision in Civil Case R-1881
should be viewed and understood in connection
with the entire text, which contemplated a return
of the property taken if the airport expansion
project were abandoned. For ease of reference,
following is what the Court wrote:
Moreover, we do not
subscribe to the [MCIAAs]
contention that since the possibility
 of the Lahug Airports closure was
actually considered by the trial
court, a stipulation on reversion or
repurchase was so material that it
should not have been discounted by
the court a quo in its decision in
Civil Case No. R-1881, if, in fact,
there was one. We find it proper to
cite, once more, this Courts ruling
that the fallo of the decision in Civil
Case No. R-1881 must be read in
reference to the other portions of the
decision in which it forms a part. A
reading of the Courts judgment
must not be confined to the
dispositive portion alone; rather it
should be meaningfully construed in
unanimity with the ratio
decidendi thereof to grasp the true
intent and meaning of a decision.[34]
The Court has, to be sure, taken stock of Fery v.
Municipality of Cabanatuan,[35] a case MCIAA cites
at every possible turn, where the Court made these
observations:
If, for example, land is
expropriated for a particular
purpose, with the condition that
when that purpose is ended or
abandoned the property shall return
to its former owner, then of course,
when the purpose is terminated or
abandoned, the former owner
reacquires the property so
expropriated. x x x If, upon the
contrary, however the decree of
expropriation gives to the entity a
fee simple title, then, of course, the
land becomes the absolute property
of the expropriator x x x and in that
case the non-user does not have the
effect of defeating the title acquired
by the expropriation proceedings x x
x.
Fery notwithstanding, MCIAA cannot really
rightfully say that it has absolute title to the lots
decreed expropriated in Civil Case No. R-1881. The
correct lesson of Fery is captured by what the
Court said in that case, thus: the government
acquires only such rights in expropriated parcels of
land as may be allowed by the character of its title
over the properties. In light of our disposition
in Heirs of Moreno and Tudtud, the statement
immediately adverted to means that in the event
the particular public use for which a parcel of land
is expropriated is abandoned, the owner shall not
be entitled to recover or repurchase it as a matter
of right, unless such recovery or repurchase is
expressed in or irresistibly deducible from the
condemnation judgment. But as has been
determined below, the decision in Civil Case No. R-
1881 enjoined MCIAA, as a condition of approving
expropriation, to allow recovery or repurchase
upon abandonment of the Lahug airport project. To
borrow from our underlying decision in Heirs of
Moreno, [n]o doubt, the return or repurchase of the
condemned properties of petitioners could readily
be justified as the manifest legal effect of
consequence of the trial courts underlying
presumption that Lahug Airport will continue to be
in operation when it granted the complaint for
eminent domain and the airport discontinued its
activities.[36]
Providing added support to the Ouanos and the
Inocians right to repurchase is what in Heirs of
Moreno was referred to as constructive trust, one
that is akin to the implied trust expressed in Art.
1454 of the Civil Code,[37] the purpose of which is to
prevent unjust enrichment.[38] In the case at bench,
the Ouanos and the Inocians parted with their
respective lots in favor of the MCIAA, the latter
obliging itself to use the realties for the expansion
of Lahug Airport; failing to keep its end of the
bargain, MCIAA can be compelled by the former
landowners to reconvey the parcels of land to
them, otherwise, they would be denied the use of
their properties upon a state of affairs that was not
conceived nor contemplated when the

expropriation was authorized. In effect, the
government merely held the properties condemned
in trust until the proposed public use or purpose
for which the lots were condemned was actually
consummated by the government. Since the
government failed to perform the obligation that is
the basis of the transfer of the property, then the
lot owners Ouanos and Inocians can demand the
reconveyance of their old properties after the
payment of the condemnation price.
Constructive trusts are fictions of equity that
courts use as devices to remedy any situation in
which the holder of the legal title, MCIAA in this
case, may not, in good conscience, retain the
beneficial interest. We add, however, as in Heirs of
Moreno, that the party seeking the aid of equitythe
landowners in this instance, in establishing the
trustmust himself do equity in a manner as the
court may deem just and reasonable.
The Court, in the recent MCIAA v. Lozada, Sr.,
revisited and abandoned the Fery ruling that the
former owner is not entitled to reversion of the
property even if the public purpose were not
pursued and were abandoned, thus:
On this note, we take this
opportunity to revisit our ruling
in Fery, which involved an
expropriation suit commenced upon
parcels of land to be used as a site
for a public market. Instead of
putting up a public market,
respondent Cabanatuan constructed
residential houses for lease on the
area. Claiming that the municipality
lost its right to the property taken
since it did not pursue its public
purpose, petitioner Juan Fery, the
former owner of the lots
expropriated, sought to recover his
properties. However, as he had
admitted that, in 1915,
respondent Cabanatuan acquired a
fee simple title to the lands in
question, judgment was rendered in
favor of the municipality, following
American jurisprudence,
particularly City of Fort Wayne v.
Lake Shore & M.S. RY.
Co., McConihay v. Theodore
Wright,and Reichling v. Covington
Lumber Co., all uniformly holding
that the transfer to a third party of
the expropriated real property,
which necessarily resulted in the
abandonment of the particular
public purpose for which the
property was taken, is not a ground
for the recovery of the same by its
previous owner, the title of the
expropriating agency being one of
fee simple.
Obviously, Fery was not
decided pursuant to our now
sacredly held constitutional right
that private property shall not be
taken for public use without just
compensation. It is well settled that
the taking of private property by the
Governments power of eminent
domain is subject to two mandatory
requirements: (1) that it is for a
particular public purpose; and (2)
that just compensation be paid to
the property owner. These
requirements partake of the nature
of implied conditions that should be
complied with to enable the
condemnor to keep the property
expropriated.
More particularly, with
respect to the element of public
use, the expropriator should
commit to use the property
pursuant to the purpose stated in
the petition for expropriation
filed, failing which, it should file
another petition for the new
purpose. If not, it is then
incumbent upon the expropriator
to return the said property to its
private owner, if the latter desires
to reacquire the same. Otherwise,
the judgment of expropriation
suffers an intrinsic flaw, as it would
lack one indispensable element for
the proper exercise of the power of
eminent domain, namely, the
particular public purpose for which
the property will be
devoted. Accordingly, the private
property owner would be denied due
process of law, and the judgment
 would violate the property owners
right to justice, fairness, and equity.
In light of these premises, we
now expressly hold that the taking
of private property, consequent to
the Governments exercise of its
power of eminent domain, is always
subject to the condition that the
property be devoted to the specific
public purpose for which it was
taken. Corollarily, if this particular
purpose or intent is not initiated or
not at all pursued, and is
peremptorily abandoned, then the
former owners, if they so desire,
may seek the reversion of the
property, subject to the return of the
amount of just compensation
received. In such a case, the
exercise of the power of eminent
domain has become improper for
lack of the required factual
justification.[39] (Emphasis supplied.)
Clinging to Fery, specifically the fee simple concept
underpinning it, is no longer compelling,
considering the ensuing inequity such application
entails. Too, the Court resolved Fery not under the
cover of any of the Philippine Constitutions, each
decreeing that private property shall not be taken
for public use without just compensation. The twin
elements of just compensation and public purpose
are, by themselves, direct limitations to the
exercise of eminent domain, arguing, in a way,
against the notion of fee simple title. The fee does
[40]
not vest until payment of just compensation.
In esse, expropriation is forced private property
taking, the landowner being really without a ghost
of a chance to defeat the case of the expropriating
agency. In other words, in expropriation,
private owner is deprived of property against his
will. Withal, the mandatory requirement of due
process ought to be strictly followed, such that the
state must show, at the minimum, a genuine need,
an exacting public purpose to take private
property, the purpose to be specifically alleged or
least reasonably deducible from the complaint.
Public use, as an eminent domain concept, has
now acquired an expansive meaning to include any
use that is of usefulness, utility, or advantage, or
what is productive of general benefit [of the public].
[41]
If the genuine public necessitythe very reason or
condition as it wereallowing, at the first instance,
the expropriation of a private land ceases or
disappears, then there is no more cogent point for
the governments retention of the expropriated
land. The same legal situation should hold if the
government devotes the property to another public
use very much different from the original or
deviates from the declared purpose to benefit
another private person. It has been said that the
direct use by the state of its power to oblige
landowners to renounce their
productive possession to another citizen, who will
use it predominantly for that citizens own private
gain, is offensive to our laws.[42]
A condemnor should commit to use the
property pursuant to the purpose stated in the
petition for expropriation, failing which it should
file another petition for the new purpose. If not,
then it behooves the condemnor to return the said
property to its private owner, if the latter so
desires. The government cannot plausibly keep the
property it expropriated in any manner it pleases
and, in the process, dishonor the judgment of
expropriation. This is not in keeping with the idea
the
of fair play,
The notion, therefore, that the
government, via expropriation proceedings,
acquires unrestricted ownership over or a fee
simple title to the covered land, is no longer
tenable. We suggested as much in Heirs of
Moreno and in Tudtud and more
in Lozada, Sr. Expropriated lands
differentiated from a piece of land, ownership of
which was absolutely transferred by way of an
unconditional purchase and sale contract freely
entered by two parties, one without obligation to
buy and the other without the duty to sell. In that
case, the fee simple concept really comes into
play. There is really no occasion to apply the fee
simple concept if the transfer is conditional. The
taking of a private land in expropriation
proceedings is always conditioned on its continued
devotion to its public purpose. As a necessary
corollary, once the purpose is terminated or
peremptorily abandoned, then the former owner, if
he so desires, may seek its reversion, subject of
course to the return, at the very least, of the just
compensation received.
To be compelled to renounce dominion over
a piece of land is, in itself, an already bitter pill to
swallow for the owner. But to be asked to sacrifice
for the common good and yield ownership to the
government which reneges on its assurance that
the private property shall be for a public purpose
may be too much. But it would be worse if the
power of eminent domain were deliberately used as
a subterfuge to benefit another with influence and
power in the political process,
development firms. The mischief thus depicted is
not at all far-fetched with the
application of Fery. Even as the Court deliberates
on these consolidated cases, there
uncontroverted allegation that the MCIAA is poised
to sell, if it has not yet sold, the areas in question
to Cebu Property Ventures, Inc. This provides an
added dimension to abandon Fery.
Given the foregoing disquisitions, equity
and justice demand the reconveyance by MCIAA of
the litigated lands in question to the Ouanos and
recently Inocians. In the same token, justice and fair play
should be also dictate that the Ouanos and Inocian return to
MCIAA what they received as just compensation for
the expropriation of their respective properties plus
legal interest to be computed from default, which
in this case should run from the time MCIAA
complies with the reconveyance obligation. [43] They
must likewise pay MCIAA the necessary expenses
it might have incurred in sustaining their
respective lots and the monetary value of its
services in managing the lots in question to the
extent that they, as private owners, were benefited
thereby.
In accordance with Art. 1187 of the Civil
Code on mutual compensation, MCIAA may keep
whatever income or fruits it may have obtained
from the parcels of land expropriated. In turn, the
Ouanos and Inocians need not require the
accounting of interests earned by the amounts
they received as just compensation.[44]
Following Art. 1189 of the Civil Code
providing that [i]f the thing is improved by its
nature, or by time, the improvement shall inure
to the benefit of the creditor x x x, the Ouanos
and Inocians do not have to settle the appreciation
including of the values of their respective lots as part of the
reconveyance process, since the value increase is
continued merely the natural effect of nature and time.
is an Finally, We delete the award of PhP 50,000
and PhP 10,000, as attorneys fees and litigation
expenses, respectively, made in favor of the
Inocians by the Cebu City RTC in its judgment in
Civil Case No. CEB-18370, as later affirmed by the
CA. As a matter of sound policy, no premium
should be set on the right to litigate where there is
no doubt about the bona fides of the exercise of
such right,[45] as here, albeit the decision of MCIAA
to resist the former landowners claim eventually consolidated petitions, when appropriate, as
turned out to be untenable. follows:

WHEREFORE, the petition in G.R. No.

(1) Petitioners Ouano, et al. in G.R. No.
168770 is GRANTED. Accordingly, the CA
168770 and respondents Ricardo L Inocian, et al.
Decision dated September 3, 2004 in CA-G.R. CV
in G.R. No. 168812 are ordered to return to the
No. 78027 is REVERSED and SET ASIDE.
MCIAA the just compensation they or their
Mactan-Cebu International Airport Authority is
predecessors-in-interest received for the
ordered to reconvey subject Lot No. 763-A to
expropriation of their respective lots as stated in
petitioners Anunciacion vda. de Ouano, Mario P.
Civil Case No. R-1881, within a period of sixty (60)
Ouano, Leticia Ouano Arnaiz, and Cielo Ouano
days from finality of judgment;
Martinez. The Register of Deeds of Cebu City is
ordered to effect the necessary cancellation of title
(2) The MCIAA shall be entitled
and transfer it in the name of the petitioners
to RETAIN whatever fruits and income it may have
within fifteen (15) days from finality of judgment.
obtained from the subject expropriated lots without
The petition of the Mactan-Cebu
any obligation to refund the same to the lot
International Airport Authority in G.R. No.
owners; and
168812 is DENIED, and the CAs Decision and
Resolution dated January 14, 2005 and June 29,
2005, respectively, in CA-G.R. CV No. 64356 (3) Petitioners Ouano, et al. in G.R. No.
are AFFIRMED, except insofar as they awarded 168770 and respondents Ricardo L. Inocian, et al.
attorneys fees and litigation expenses that are in G.R. No. 168812 shall RETAIN whatever
hereby DELETED. Accordingly, Mactan-Cebu interests the amounts they received as just
International Airport Authority is ordered to compensation may have earned in the meantime
reconvey to respondents Ricardo L. Inocian, without any obligation to refund the same to
Olympia E. Esteves, Emilia E. Bacalla, Restituta E. MCIAA.
Montana, and Raul L. Inocian the litigated Lot Nos. SO ORDERED.
744-A, 745-A, 746, 762-A, 747, and 761-A; and to
GR# 176625
respondents Aletha Suico Magat, Philip M. Suico,
#7 Case
Dolores S. dela Cruz, James M. Suico, Edward M.
DECISION
Suico, Roselyn S. Lawsin, Rex M. Suico, and
Kharla Suico-Gutierrez the litigated Lot Nos. 942 NACHURA, J.:
and 947. The Register of Deeds of Cebu City is
This is a petition for review on certiorari under Rule
ordered to effect the necessary cancellation of title
45 of the Rules of Court, seeking to reverse, annul,
and transfer it in the name of respondents within a
and set aside the Decision[1] dated February 28,
period of fifteen (15) days from finality of judgment.
2006 and the Resolution[2] dated February 7, 2007
of the Court of Appeals (CA) (Cebu City), Twentieth
The foregoing dispositions are subject
Division, in CA-G.R. CV No. 65796.
to QUALIFICATIONS, to apply to these
The antecedent facts and proceedings are as proposed a compromise settlement whereby the
follows: owners of the lots affected by the expropriation
proceedings would either not appeal or withdraw
Subject of this case is Lot No. 88-SWO-25042 (Lot their respective appeals in consideration of a
No. 88), with an area of 1,017 square meters, more commitment that the expropriated lots would be
or less, located in Lahug, Cebu City. Its original resold at the price they were expropriated in the
owner was Anastacio Deiparine when the same event that the ATO would abandon the Lahug
was subject to expropriation proceedings, initiated Airport, pursuant to an established policy involving
by the Republic of the Philippines (Republic), similar cases. Because of this promise, Lozada did
represented by the then Civil Aeronautics not pursue his appeal. Thereafter, Lot No. 88 was
Administration (CAA), for the expansion and transferred and registered in the name of the
improvement of the Lahug Airport. The case was Republic under TCT No. 25057.
filed with the then Court of First Instance of Cebu,
Third Branch, and docketed as Civil Case No. R- The projected improvement and expansion plan of
1881. the old Lahug Airport, however, was not pursued.

As early as 1947, the lots were already occupied by Lozada, with the other landowners, contacted then
the U.S. Army. They were turned over to the CAA Director Vicente Rivera, Jr., requesting to
Surplus Property Commission, the Bureau of repurchase the lots, as per previous
Aeronautics, the National Airport Corporation and agreement. The CAA replied that there might still
then to the CAA. be a need for the Lahug Airport to be used as an
emergency DC-3 airport. It reiterated, however, the
During the pendency of the expropriation assurance that should this Office dispose and
proceedings, respondent Bernardo L. Lozada, Sr. resell the properties which may be found to be no
acquired Lot No. 88 from Deiparine. Consequently, longer necessary as an airport, then the policy of
Transfer Certificate of Title (TCT) No. 9045 was this Office is to give priority to the former owners
issued in Lozadas name. subject to the approval of the President.

On December 29, 1961, the trial court rendered On November 29, 1989, then President Corazon C.
judgment in favor of the Republic and ordered the Aquino issued a Memorandum to the Department
latter to pay Lozada the fair market value of Lot of Transportation, directing the transfer of general
No. 88, adjudged at P3.00 per square meter, with aviation operations of the LahugAirport to
consequential damages by way of legal interest the Mactan International Airport before the end of
computed from November 16, 1947the time when 1990 and, upon such transfer, the closure of
the lot was first occupied by the airport. Lozada the Lahug Airport.
received the amount of P3,018.00 by way of
payment. Sometime in 1990, the Congress of the Philippines
passed Republic Act (R.A.) No. 6958, entitled An
The affected landowners appealed. Pending appeal, Act Creating the Mactan-Cebu International
the Air Transportation Office (ATO), formerly CAA, Airport Authority, Transferring Existing Assets of
 (d) During the pendency of the
the Mactan International Airport and the Lahug
appeal, the parties entered into
Airport to the Authority, Vesting the Authority with a compromise settlement to
the effect that the subject
Power to Administer and Operate the Mactan property would be resold to the
International Airport and the Lahug Airport, and original owner at the same
price when it was expropriated
For Other Purposes. in the event that the
Government abandons
the Lahug Airport;
From the date of the institution of the
expropriation proceedings up to the present, the (e) Title to Lot No. 88 was
subsequently transferred to
public purpose of the said expropriation (expansion the Republic of
of the airport) was never actually initiated, realized, the Philippines (TCT No.
25057);
or implemented. Instead, the old airport was
converted into a commercial complex. Lot No. 88 (f) The projected expansion and
improvement of
became the site of a jail known as Bagong Buhay the Lahug Airport did not
materialize;
Rehabilitation Complex, while a portion thereof was
occupied by squatters.[3] The old airport was (g) Plaintiffs sought to repurchase
their property from then CAA
converted into what is now known as
Director Vicente Rivera. The
the Ayala I.T. Park, a commercial area. latter replied by giving as
assurance that priority would
be given to the previous
Thus, on June 4, 1996, petitioners initiated a owners, subject to the
approval of the President,
complaint for the recovery of possession and should CAA decide to dispose
reconveyance of ownership of Lot No. 88. The case of the properties;

was docketed as Civil Case No. CEB-18823 and (h) On November 29, 1989, then
was raffled to the Regional Trial Court (RTC), President Corazon C. Aquino,
through a Memorandum to the
Branch 57, Cebu City. The complaint substantially Department of Transportation
alleged as follows: and Communications (DOTC),
directed the transfer of general
aviation operations at
(a) Spouses Bernardo and Rosario the Lahug Airport to the
Lozada were the registered Mactan-Cebu International
owners of Lot No. 88 covered Airport Authority;
by TCT No. 9045;
(i) Since the public purpose for the
(b) In the early 1960s, the Republic expropriation no longer exists,
sought to acquire by the property must be returned
expropriation Lot No. 88, to the plaintiffs.[4]
among others, in connection
with its program for the
improvement and expansion of
the Lahug Airport; In their Answer, petitioners asked for the
immediate dismissal of the complaint. They
(c) A decision was rendered by the
Court of First Instance in favor specifically denied that the Government had made
of the Government and against assurances to reconvey Lot No. 88 to respondents
the land owners, among whom
was Bernardo Lozada, Sr. in the event that the property would no longer be
appealed therefrom; needed for airport operations. Petitioners instead
asserted that the judgment of condemnation was
unconditional, and respondents were, therefore,
not entitled to recover the expropriated property
notwithstanding non-use or abandonment thereof.
After pretrial, but before trial on the merits, the
parties stipulated on the following set of facts:
(1) The lot involved is Lot No. 88-
SWO-25042 of the Banilad
Estate, situated in the City
of Cebu, containing an area of
One Thousand Seventeen
(1,017) square meters, more or
less;
(2) The property was expropriated
among several other properties
in Lahug in favor of the
Republic of the Philippines by
virtue of a Decision dated
December 29, 1961 of the CFI
of Cebu in Civil Case No. R-
1881;
(3) The public purpose for which the
property was expropriated was
for the purpose of
the Lahug Airport;
(4) After the expansion, the property
was transferred in the name of
MCIAA; [and]
(5) On November 29, 1989, then
President Corazon C. Aquino
directed the Department of
Transportation and
Communication to transfer
general aviation operations of
the Lahug Airport to the
Mactan-Cebu International
Airport Authority and to close
the Lahug Airport after such
transfer[.][5]
During trial, respondents presented
Lozada, Sr. as their lone witness, while petitioners
presented their own witness, Mactan-Cebu
International Airport Authority legal
Michael Bacarisas.
On October 22, 1999, the RTC rendered its
Decision, disposing as follows:
WHEREFORE, in the light of the
foregoing, the Court hereby renders
judgment in favor of the plaintiffs,
Bernardo L. Lozada, Sr., and the
heirs of Rosario Mercado, namely,
Vicente M. Lozada, Marcia L.
Godinez, Virginia L. Flores,
Bernardo M. Lozada, Jr., Dolores L.
Gacasan, Socorro L. Cafaro and
Rosario M. Lozada, represented by
their attorney-in-fact Marcia Lozada
Godinez, and against defendants
Cebu-Mactan International Airport
Authority (MCIAA) and Air
Transportation Office (ATO):
1. ordering MCIAA and ATO
to restore to plaintiffs the
possession and ownership of their
land, Lot No. 88 Psd-821 (SWO-
23803), upon payment of the
expropriation price to plaintiffs; and
2. ordering the Register of
Deeds to effect the transfer of the
Certificate of Title from defendant[s]
to plaintiffs on Lot No. [88],
cancelling TCT No. 20357 in the
name of defendant MCIAA and to
issue a new title on the same lot in
the name of Bernardo L. Lozada, Sr.
and the heirs of Rosario Mercado,
namely: Vicente M. Lozada, Mario
M. Lozada, Marcia L. Godinez,
Virginia L. Flores, Bernardo M.
Lozada, Jr., Dolores L. Gacasan,
Socorro L. Cafaro and Rosario M.
Lozada.
No pronouncement as to costs.
SO ORDERED.[6]
Aggrieved, petitioners interposed an appeal to the
Bernardo CA. After the filing of the necessary appellate
briefs, the CA rendered its assailed Decision dated
February 28, 2006, denying petitioners appeal and
assistant affirming in toto the Decision of the RTC, Branch
57, Cebu City. Petitioners motion for
reconsideration was, likewise, denied in the
questioned CA Resolution dated February 7, 2007.
 expropriation gives to the entity a
fee simple title, then, of course, the
Hence, this petition arguing that: (1) the land becomes the absolute property
of the expropriator, whether it be
respondents utterly failed to prove that there was a the State, a province, or
repurchase agreement or compromise settlement municipality, and in that case the
non-user does not have the effect of
between them and the Government; (2) the defeating the title acquired by the
judgment in Civil Case No. R-1881 was absolute expropriation proceedings. x x x.

and unconditional, giving title in fee simple to the When land has been
Republic; and (3) the respondents claim of verbal acquired for public use in fee
simple, unconditionally, either by the
assurances from government officials violates the exercise of eminent domain or by
Statute of Frauds. purchase, the former owner retains
no right in the land, and the public
use may be abandoned, or the land
The petition should be denied. may be devoted to a different use,
without any impairment of the
estate or title acquired, or any
reversion to the former owner. x x x.
Petitioners anchor their claim to the controverted [8]

property on the supposition that the Decision in

the pertinent expropriation proceedings did not
Contrary to the stance of petitioners, this
provide for the condition that should the intended
Court had ruled otherwise in Heirs of Timoteo
use of Lot No. 88 for the expansion of
Moreno and Maria Rotea v. Mactan-Cebu
the Lahug Airport be aborted or abandoned, the
[9]
International Airport Authority, thus
property would revert to respondents, being its
former owners. Petitioners cite, in support of this
Moreover, respondent MCIAA has
position, Fery v. Municipality of Cabanatuan, brought to our attention a
[7]
significant and telling portion in
which declared that the Government acquires the Decision in Civil Case No. R-
only such rights in expropriated parcels of land as 1881 validating our discernment
that the expropriation by the
may be allowed by the character of its title over the predecessors of respondent was
properties ordered under the running
impression
that Lahug Airport would continue
If x x x land is expropriated for a in operation
particular purpose, with the
condition that when that purpose is As for the public
ended or abandoned the property purpose of the
shall return to its former owner, expropriation
then, of course, when the purpose is proceeding, it cannot
terminated or abandoned the former now be
owner reacquires the property so doubted. Although M
expropriated. If x x x land is actan Airport is being
expropriated for a public street and constructed, it does
the expropriation is granted upon not take away the
condition that the city can only use actual usefulness and
it for a public street, then, of course, importance of
when the city abandons its use as a the Lahug Airport: it
public street, it returns to the is handling the air
former owner, unless there is some traffic both civilian
statutory provision to the and military. From it
contrary. x x x. If, upon the aircrafts fly to
contrary, however, the decree of Mindanao and
 Visayas and pass become an intrinsic part of
thru it on their flights the fallo thereof which under the
to the North premises is clearly inadequate since
and Manila.Then, no the dispositive portion is not in
evidence was accord with the findings as
adduced to show how contained in the body thereof.[10]
soon is
the Mactan Airport to
be placed in operation
Indeed, the Decision in Civil Case No. R-1881
and whether
the Lahug Airport will should be read in its entirety, wherein it is
be closed immediately
thereafter. It is up to apparent that the acquisition by the Republic of
the other the expropriated lots was subject to the condition
departments of the
Government to that the Lahug Airport would continue its
determine said operation. The condition not having materialized
matters. The Court
cannot substitute its because the airport had been abandoned, the
judgment for those of former owner should then be allowed to reacquire
the said departments
or agencies. In the the expropriated property.[11]
absence of such
showing, the Court
will presume that On this note, we take this opportunity to revisit
the Lahug Airport will our ruling in Fery, which involved an expropriation
continue to be in
operation (emphasis suit commenced upon parcels of land to be used as
supplied).
a site for a public market. Instead of putting up a
While in the trial in Civil Case No. public market,
R-1881 [we] could have simply
respondent Cabanatuan constructed residential
acknowledged the presence of public
purpose for the exercise of eminent houses for lease on the area. Claiming that the
domain regardless of the survival
municipality lost its right to the property taken
of Lahug Airport, the trial court in
its Decision chose not to do so but since it did not pursue its public purpose,
instead prefixed its finding of public
purpose upon its understanding petitioner Juan Fery, the former owner of the lots
that Lahug Airport will continue to be expropriated, sought to recover his
in operation. Verily, these
meaningful statements in the body properties. However, as he had admitted that, in
of the Decision warrant the 1915, respondent Cabanatuan acquired a fee
conclusion that the expropriated
properties would remain to be so simple title to the lands in question, judgment was
until it was confirmed rendered in favor of the municipality, following
that Lahug Airport was no longer in
operation. This inference further American jurisprudence, particularly City of Fort
implies two (2) things: (a) after Wayne v. Lake Shore & M.S. RY. Co.,[12] McConihay
the Lahug Airport ceased its
undertaking as such and the v. Theodore Wright,[13] and Reichling v. Covington
expropriated lots were not being Lumber Co.,[14] all uniformly holding that the
used for any airport expansion
project, the rights vis--vis the transfer to a third party of the expropriated real
expropriated Lots Nos. 916 and 920
property, which necessarily resulted in the
as between the State and their
former owners, petitioners herein, abandonment of the particular public purpose for
must be equitably adjusted; and (b)
which the property was taken, is not a ground for
the foregoing unmistakable
declarations in the body of the recovery of the same by its previous owner, the
the Decision should merge with and
title of the expropriating agency being one of fee
simple.
Obviously, Fery was not decided pursuant to our
now sacredly held constitutional right that private
property shall not be taken for public use without
[15]
just compensation. It is well settled that the
taking of private property by the Governments
power of eminent domain is subject to two
mandatory requirements: (1) that it is for a
particular public purpose; and (2) that just
compensation be paid to the property owner. These
requirements partake of the nature of implied
conditions that should be complied with to enable
the condemnor to keep the property expropriated.
[16]
More particularly, with respect to the element of
public use, the expropriator should commit to use
the property pursuant to the purpose stated in the
petition for expropriation filed, failing which, it
should file another petition for the new purpose. If
not, it is then incumbent upon the expropriator to
return the said property to its private owner, if the
latter desires to reacquire the same. Otherwise, the
judgment of expropriation suffers an intrinsic flaw,
as it would lack one indispensable element for the
proper exercise of the power of eminent domain,
namely, the particular public purpose for which
the property will be devoted. Accordingly, the
private property owner would be denied due
process of law, and the judgment would violate the
property owners right to justice, fairness, and
equity.
In light of these premises, we now expressly hold
that the taking of private property, consequent to
the Governments exercise of its power of eminent
domain, is always subject to the condition that the
property be devoted to the specific public purpose
for which it was taken. Corollarily, if this particular
purpose or intent is not initiated or not at all
pursued, and is peremptorily abandoned, then the
former owners, if they so desire, may seek the
reversion of the property, subject to the return of
the amount of just compensation received. In such
a case, the exercise of the power of eminent
domain has become improper for lack of the
required factual justification.[17]
Even without the foregoing declaration, in the
instant case, on the question of whether
respondents were able to establish the existence of
an oral compromise agreement that entitled them
to repurchase Lot No. 88 should the operations of
the Lahug Airport be abandoned, we rule in the
affirmative.
It bears stressing that both the RTC, Branch 57,
Cebu and the CA have passed upon this factual
issue and have declared, in no uncertain terms,
that a compromise agreement was, in fact, entered
into between the Government and respondents,
with the former undertaking to resell Lot No. 88 to
the latter if the improvement and expansion of the
Lahug Airport would not be pursued. In affirming
the factual finding of the RTC to this effect, the CA
declared
Lozadas testimony is cogent. An
octogenarian widower-retiree and a
resident of Moon
Park, California since 1974, he
testified that government
representatives verbally promised
him and his late wife while the
expropriation proceedings were on-
going that the government shall
return the property if the purpose
for the expropriation no longer
exists. This promise was made at
the premises of the airport.As far as
he could remember, there were no
expropriation proceedings against
his property in 1952 because the
 first notice of expropriation he
received was in 1962. Based on the
promise, he did not hire a Verily, factual findings of the trial court,
lawyer. Lozada was firm that he was
promised that the lot would be especially when affirmed by the CA, are binding
reverted to him once the public use and conclusive on this Court and may not be
of the lot ceases. He made it clear
that the verbal promise was made in reviewed. A petition for certiorari under Rule 45 of
Lahug with other lot owners before the Rules of Court contemplates only questions of
the 1961 decision was handed
down, though he could not name law and not of fact.[21] Not one of the exceptions to
the government representatives who this rule is present in this case to warrant a
made the promise. It was just a
verbal promise; nevertheless, it is reversal of such findings.
binding. The fact that he could not
supply the necessary details for the
establishment of his assertions As regards the position of petitioners that
during cross-examination, but that respondents testimonial evidence violates the
When it will not be used as
intended, it will be returned back, Statute of Frauds, suffice it to state that the
we just believed in the government,
Statute of Frauds operates only with respect to
does not dismantle the credibility
and truthfulness of his executory contracts, and does not apply to
allegation. This Court notes that he
contracts which have been completely or partially
was 89 years old when he testified
in November 1997 for an incident performed, the rationale thereof being as follows:
which happened decades ago. Still,
he is a competent witness capable of
In executory contracts there is a wide field
perceiving and making his
for fraud because unless they be in writing
perception known. The minor lapses
there is no palpable evidence of the
are immaterial. The decision of the
intention of the contracting parties. The
competency of a witness rests
statute has precisely been enacted to
primarily with the trial judge and
prevent fraud. However, if a contract has
must not be disturbed on appeal
been totally or partially performed, the
unless it is clear that it was
exclusion of parol evidence would promote
erroneous. The objection to his
fraud or bad faith, for it would enable the
competency must be made before he
defendant to keep the benefits already
has given any testimony or as soon
delivered by him from the transaction in
as the incompetency becomes
litigation, and, at the same time, evade the
apparent. Though Lozada is not part
obligations, responsibilities or liabilities
of the compromise agreement,[18] he
assumed or contracted by him thereby.[22]
nevertheless adduced sufficient
evidence to support his claim.[19]

In this case, the Statute of Frauds, invoked by

As correctly found by the CA, unlike in Mactan
Cebu International Airport Authority v. Court of
Appeals,[20] cited by petitioners, where respondent
therein offered testimonies which were hearsay in
nature, the testimony of Lozada was based on
personal knowledge as the assurance from the
government was personally made to him. His
testimony on cross-examination destroyed neither
his credibility as a witness nor the truthfulness of
his words.
petitioners to bar the claim of respondents for the
reacquisition of Lot No. 88, cannot apply, the oral
compromise settlement having been partially
performed. By reason of such assurance made in
their favor, respondents relied on the same by not
pursuing their appeal before the CA. Moreover,
contrary to the claim of petitioners, the fact of
Lozadas eventual conformity to the appraisal of Lot
No. 88 and his seeking the correction of a clerical
error in the judgment as to the true area of Lot No.

88 do not conclusively establish that respondents
absolutely parted with their property. To our mind,
these acts were simply meant to cooperate with the
government, particularly because of the oral
promise made to them.
The right of respondents to repurchase Lot No. 88
may be enforced based on a constructive trust
constituted on the property held by the
government in favor of the former. On this note,
our ruling in Heirs of Timoteo Moreno is
instructive, viz.:
Mactan-Cebu International Airport
Authority is correct in stating that one
would not find an express statement in the
Decision in Civil Case No. R-1881 to the
effect that the [condemned] lot would return
to [the landowner] or that [the landowner]
had a right to repurchase the same if the
purpose for which it was expropriated is
ended or abandoned or if the property was
to be used other than as the Lahug
Airport. This omission notwithstanding, and
while the inclusion of this pronouncement
in the judgment of condemnation would
have been ideal, such precision is not
absolutely necessary nor is it fatal to the
cause of petitioners herein. No doubt, the
return or repurchase of the condemned
properties of petitioners could be readily
justified as the manifest legal effect or
consequence of the trial courts underlying
presumption that Lahug Airport will
continue to be in operation when it granted
the complaint for eminent domain and the
airport discontinued its activities.
The predicament of petitioners involves a
constructive trust, one that is akin to the
implied trust referred to in Art. 1454 of
the Civil Code, If an absolute conveyance of
property is made in order to secure the
performance of an obligation of the grantor
toward the grantee, a trust by virtue of law
is established. If the fulfillment of the
obligation is offered by the grantor when it
becomes due, he may demand the
reconveyance of the property to him. In the
case at bar, petitioners conveyed Lots No.
916 and 920 to the government with the
latter obliging itself to use the realties for
the expansion of Lahug Airport; failing to
keep its bargain, the government can be
compelled by petitioners to reconvey the
parcels of land to them, otherwise,
petitioners would be denied the use of their
properties upon a state of affairs that was
not conceived nor contemplated when the
expropriation was authorized.
Although the symmetry between the instant
case and the situation contemplated by Art.
1454 is not perfect, the provision is
undoubtedly applicable. For, as explained
by an expert on the law of trusts: The only
problem of great importance in the field of
constructive trust is to decide whether in the
numerous and varying fact situations
presented to the courts there is a wrongful
holding of property and hence a threatened
unjust enrichment of the
defendant. Constructive trusts are fictions
of equity which are bound by no unyielding
formula when they are used by courts as
devices to remedy any situation in which
the holder of legal title may not in good
conscience retain the beneficial interest.
In constructive trusts, the arrangement is
temporary and passive in which the
trustees sole duty is to transfer the title and
possession over the property to the
plaintiff-beneficiary. Of course,
the wronged party seeking the aid of a court
of equity in establishing a constructive trust
must himself do equity. Accordingly, the
court will exercise its discretion in deciding
what acts are required of the plaintiff-
beneficiary as conditions precedent to
obtaining such decree and has the
obligation to reimburse the trustee the
consideration received from the latter just
as the plaintiff-beneficiary would if he
proceeded on the theory of rescission. In
the good judgment of the court, the trustee
may also be paid the necessary expenses he
may have incurred in sustaining the
property, his fixed costs for improvements
thereon, and the monetary value of his
services in managing the property to the
extent that plaintiff-beneficiary will secure a
benefit from his acts.
The rights and obligations between the
constructive trustee and the beneficiary, in
this case, respondent MCIAA and
petitioners over Lots Nos. 916 and 920, are
echoed in Art. 1190 of the Civil Code, When
the conditions have for their purpose the
extinguishment of an obligation to give, the
parties, upon the fulfillment of said
conditions, shall return to each other what
they have received x x x In case of the loss,
deterioration or improvement of the thing,
the provisions which, with respect to the
and its February 7, 2007 Resolution
debtor, are laid down in the preceding
article shall be applied to the party who is are AFFIRMED with MODIFICATION as follows:
bound to return x x x.[23]

1. Respondents are ORDERED to return to

On the matter of the repurchase price, while petitioners the just compensation they received for
petitioners are obliged to reconvey Lot No. 88 to the expropriation of Lot No. 88, plus legal interest,
respondents, the latter must return to the former in the case of default, to be computed from the
what they received as just compensation for the time petitioners comply with their obligation to
expropriation of the property, plus legal interest to reconvey Lot No. 88 to them;
be computed from default, which in this case runs
from the time petitioners comply with their 2. Respondents are ORDERED to pay petitioners
obligation to respondents. the necessary expenses the latter incurred in
maintaining Lot No. 88, plus the monetary value of
Respondents must likewise pay petitioners the their services to the extent that respondents were
necessary expenses they may have incurred in benefited thereby;
maintaining Lot No. 88, as well as the monetary
value of their services in managing it to the extent 3. Petitioners are ENTITLED to keep
that respondents were benefited thereby. whatever fruits and income they may have
obtained from Lot No. 88; and
Following Article 1187[24] of the Civil Code,
petitioners may keep whatever income or fruits 4. Respondents are also ENTITLED to keep
they may have obtained from Lot No. 88, and whatever interests the amounts they received as
respondents need not account for the interests that just compensation may have earned in the
the amounts they received as just compensation meantime, as well as the appreciation in value of
may have earned in the meantime. Lot No. 88, which is a natural consequence of
nature and time;
[25]
In accordance with Article 1190 of the Civil Code
vis--vis Article 1189, which provides that (i)f a In light of the foregoing modifications, the case
thing is improved by its nature, or by time, the is REMANDED to the Regional Trial Court, Branch
improvement shall inure to the benefit of the 57, Cebu City, only for the purpose of receiving
creditor x x x, respondents, as creditors, do not evidence on the amounts that respondents will
have to pay, as part of the process of restitution, have to pay petitioners in accordance with this
the appreciation in value of Lot No. 88, which is a Courts decision. No costs.
natural consequence of nature and time.[26] SO ORDERED.

G.R. No. 165828 August 24, 2011

WHEREFORE, the petition is DENIED. The
February 28, 2006 Decision of the Court of NATIONAL POWER CORPORATION, Petitioner,
vs.
Appeals, affirming the October 22, 1999 Decision HEIRS OF MACABANGKIT SANGKAY, namely:
of the Regional Trial Court, Branch 87, Cebu City, CEBU, BATOWA-AN, SAYANA, NASSER, MANTA,
EDGAR, PUTRI , MONGKOY*, and AMIR, all
surnamed MACABANGKIT, Respondents.
DECISION
BERSAMIN, J.:
Private property shall not be taken for public use
without just compensation.
– Section 9, Article III, 1987 Constitution
The application of this provision of the
Constitution is the focus of this appeal.
Petitioner National Power Corporation (NPC) seeks
the review on certiorari of the decision promulgated
on October 5, 2004,1 whereby the Court of Appeals
(CA) affirmed the decision dated August 13, 1999
and the supplemental decision dated August 18,
1999, ordering NPC to pay just compensation to
the respondents, both rendered by the Regional
Trial Court, Branch 1, in Iligan City (RTC).
Antecedents
Pursuant to its legal mandate under Republic Act
No. 6395 (An Act Revising the Charter of the
National Power Corporation), NPC undertook the
Agus River Hydroelectric Power Plant Project in the
1970s to generate electricity for Mindanao. The
project included the construction of several
underground tunnels to be used in diverting the
water flow from the Agus River to the hydroelectric
plants.2
On November 21, 1997, the respondents, namely:
Cebu, Bangowa-an, Sayana, Nasser, Manta, Edgar,
Putri, Mongkoy and Amir, all surnamed
Macabangkit (Heirs of Macabangkit), as the owners
of land with an area of 221,573 square meters
situated in Ditucalan, Iligan City, sued NPC in the
RTC for the recovery of damages and of the
property, with the alternative prayer for the
payment of just compensation.3 They alleged that
they had belatedly discovered that one of the
underground tunnels of NPC that diverted the
water flow of the Agus River for the operation of the
Hydroelectric Project in Agus V, Agus VI and Agus
VII traversed their land; that their discovery had
occurred in 1995 after Atty. Saidali C. Gandamra,
President of the Federation of Arabic Madaris
School, had rejected their offer to sell the land
because of the danger the underground tunnel
might pose to the proposed Arabic Language
Training Center and Muslims Skills Development
Center; that such rejection had been followed by
the withdrawal by Global Asia Management and
Resource Corporation from developing the land
into a housing project for the same reason; that Al-
Amanah Islamic Investment Bank of the
Philippines had also refused to accept their land as
collateral because of the presence of the
underground tunnel; that the underground tunnel
had been constructed without their knowledge and
consent; that the presence of the tunnel deprived
them of the agricultural, commercial, industrial
and residential value of their land; and that their
land had also become an unsafe place for
habitation because of the loud sound of the water
rushing through the tunnel and the constant
shaking of the ground, forcing them and their
workers to relocate to safer grounds.
In its answer with counterclaim, 4 NPC countered
that the Heirs of Macabangkit had no right to
compensation under section 3(f) of Republic Act
No. 6395, under which a mere legal easement on
their land was established; that their cause of
action, should they be entitled to compensation,
already prescribed due to the tunnel having been
constructed in 1979; and that by reason of the
tunnel being an apparent and continuous
easement, any action arising from such easement
prescribed in five years.
Ruling of the RTC
On July 23, 1998, an ocular inspection of the land
that was conducted by RTC Judge Mamindiara P.
Mangotara and the representatives of the parties
resulted in the following observations and findings:
a. That a concrete post which is about two feet in
length from the ground which according to the
claimants is the middle point of the tunnel.
b. That at least three fruit bearing durian trees
were uprooted and as a result of the construction
by the defendant of the tunnel and about one
hundred coconuts planted died.
c. That underground tunnel was constructed
therein.5
After trial, the RTC ruled in favor of the plaintiffs
(Heirs of Macabangkit),6 decreeing:
WHEREFORE, premises considered:
1. The prayer for the removal or dismantling of
defendant’s tunnel is denied. However, defendant
is hereby directed and ordered:
a)To pay plaintiffs’ land with a total area of
227,065 square meters, at the rate of FIVE
HUNDRED (₱500.00) PESOS per square meter, or
a total of ONE HUNDRED THIRTEEN MILLION
FIVE HUNDRED THIRTY TWO THOUSAND AND
FIVE HUNDRED (₱113,532,500.00), PESOS, plus
interest, as actual damages or just compensation;
b) To pay plaintiff a monthly rental of their land in
the amount of THIRTY THOUSAND (₱30,000.00)
PESOS from 1979 up to July 1999 with 12%
interest per annum;
c)To pay plaintiffs the sum of TWO HUNDRED
THOUSAND (₱200,000.00) PESOS, as moral
damages;
d) To pay plaintiffs, the sum of TWO HUNDRED
THOUSAND (₱200,000.00) PESOS, as exemplary
damages;
e)To pay plaintiffs, the sum equivalent to 15% of
the total amount awarded, as attorney’s fees, and
to pay the cost.
SO ORDERED.
The RTC found that NPC had concealed the
construction of the tunnel in 1979 from the Heirs
of Macabangkit, and had since continuously
denied its existence; that NPC had acted in bad
faith by taking possession of the subterranean
portion of their land to construct the tunnel
without their knowledge and prior consent; that
the existence of the tunnel had affected the entire
expanse of the land, and had restricted their right
to excavate or to construct a motorized deep well;
and that they, as owners, had lost the agricultural,
commercial, industrial and residential value of the
land.
The RTC fixed the just compensation at
₱500.00/square meter based on the testimony of
Dionisio Banawan, OIC-City Assessor of Iligan
City, to the effect that the appraised value of the
adjoining properties ranged from ₱700.00 to
₱750.00, while the appraised value of their affected
land ranged from ₱400.00 to ₱500.00. The RTC
also required NPC to pay rentals from 1979 due to
its bad faith in concealing the construction of the
tunnel from the Heirs of Macabangkit.
On August 18, 1999, the RTC issued a
supplemental decision,7 viz:
Upon a careful review of the original decision dated
August 13, 1999, a sentence should be added to
paragraph 1(a) of the dispositive portion thereof, to
bolster, harmonize, and conform to the findings of
the Court, which is quoted hereunder, to wit:
"Consequently, plaintiffs’ land or properties are
hereby condemned in favor of defendant National
Power Corporation, upon payment of the aforesaid
sum."
Therefore, paragraph 1(a) of the dispositive portion
of the original decision should read, as follows:
a) To pay plaintiffs’ land with a total area of
227,065 square meters, at the rate of FIVE
HUNDRED (₱500.00) PESOS per square meter, or
a total of ONE HUNDRED THIRTEEN MILLION
FIVE HUNDRED THIRTY TWO THOUSAND AND
FIVE HUNDRED (₱113,532,500.00) PESOS, plus
interest, as actual damages or just
compensation; Consequently, plaintiffs’ land or
properties are hereby condemned in favor of
defendant National Power Corporation, upon
payment of the aforesaid sum;
This supplemental decision shall be considered as
part of paragraph 1(a) of the dispositive portion of
the original decision.
Furnish copy of this supplemental decision to all
parties immediately.
SO ORDERED.
On its part, NPC appealed to the CA on August 25,
1999.8
Earlier, on August 18, 1999, the Heirs of
Macabangkit filed an urgent motion for execution
of judgment pending appeal.9 The RTC granted the
motion and issued a writ of execution, 10 prompting
NPC to assail the writ by petition for certiorari in
the CA. On September 15, 1999, the CA issued a
temporary restraining order (TRO) to enjoin the
RTC from implementing its decision. The Heirs of
Macabangkit elevated the ruling of the CA (G.R.
No. 141447), but the Court upheld the CA on May
4, 2006.11
Ruling of the CA
NPC raised only two errors in the CA, namely:
I
THE COURT A QUO SERIOUSLY ERRED IN
RULING THAT NAPOCOR’S UNDERGROUND
TUNNEL IN ITS AGUS RIVER HYDRO-ELECTRIC
PLANT PROJECT TRAVERSED AND/OR
AFFECTED APPELLEES’ PROPERTY AS THERE IS
NO CLEAR EVIDENCE INDUBITABLY
ESTABLISHING THE SAME
II
THE COURT A QUO SERIOUSLY ERRED IN
GRANTING APPELLEES’ CLAIMS IN THEIR
ENTIRETY FOR GRANTING ARGUENDO THAT
NAPOCOR’S UNDERGROUND TUNNEL INDEED
TRAVERSED APPELLEE’S PROPERTY, THEIR
CAUSE OF ACTION HAD ALREADY BEEN
BARRED BY PRESCRIPTION, ESTOPPEL AND
LACHES
On October 5, 2004, the CA affirmed the decision
of the RTC, holding that the testimonies of NPC’s
witness Gregorio Enterone and of the respondents’
witness Engr. Pete Sacedon, the topographic
survey map, the sketch map, and the ocular
inspection report sufficiently established the
existence of the underground tunnel traversing the
land of the Heirs of Macabangkit; that NPC did not
substantiate its defense that prescription already
barred the claim of the Heirs of Macabangkit; and
that Section 3(i) of R.A. No. 6395, being silent
about tunnels, did not apply, viz:
As regard Section 3(i) of R.A. No. 6395 (An Act
Revising the Charter of the National Power
Corporation), it is submitted that the same
provision is not applicable. There is nothing in
Section 3(i) of said law governing claims involving
tunnels. The same provision is applicable to those
projects or facilities on the surface of the land, that
can easily be discovered, without any mention
about the claims involving tunnels, particularly
those surreptitiously constructed beneath the
surface of the land, as in the instant case.
Now, while it is true that Republic Act No. 6395
authorizes NAPOCOR to take water from any
public stream, river, creek, lake, spring or waterfall
in the Philippines for the realization of the
purposes specified therein for its creation; to
intercept and divert the flow of waters from lands
of riparian owners (in this case, the "Heirs"), and
from persons owning or interested in water which
are or may be necessary to said purposes, the
same Act expressly mandates the payment of just
compensation.
WHEREFORE, premises considered, the instant
appeal is hereby DENIED for lack of merit.
Accordingly, the appealed Decision dated August
13, 1999, and the supplemental Decision dated
August 18, 1999, are hereby AFFIRMED in toto.
SO ORDERED.12
Issue
NPC has come to the Court, assigning the lone
error that:
THE APPELLATE COURT ERRED ON A QUESTION
OF LAW WHEN IT AFFIRMED THE DECISION AND
SUPPLEMENTAL DECISION OF THE COURT A
QUO DIRECTING AND ORDERING PETITIONER
TO PAY JUST COMPENSATION TO
RESPONDENTS.
NPC reiterates that witnesses Enterone and
Sacedon lacked personal knowledge about the
construction and existence of the tunnel and were
for that reason not entitled to credence; and that
the topographic and relocation maps prepared by
Sacedon should not be a basis to prove the
existence and location of the tunnel due to being
self-serving.
NPC contends that the CA should have applied
Section 3(i) of Republic Act No. 6395, which
provided a period of only five years from the date of
the construction within which the affected
landowner could bring a claim against it; and that
even if Republic Act No. 6395 should be
inapplicable, the action of the Heirs of
Macabangkit had already prescribed due to the
underground tunnel being susceptible to
acquisitive prescription after the lapse of 10 years
pursuant to Article 620 of the Civil Code due to its
being a continuous and apparent legal easement
under Article 634 of the Civil Code.
The issues for resolution are, therefore, as follows:
(1) Whether the CA and the RTC erred in holding
that there was an underground tunnel traversing
the Heirs of Macabangkit’s land constructed by
NPC; and
(2) Whether the Heirs of Macabangkit’s right to
claim just compensation had prescribed under
section 3(i) of Republic Act No. 6395, or,
alternatively, under Article 620 and Article 646 of
the Civil Code.
Ruling
We uphold the liability of NPC for payment of just
compensation.
1.
Factual findings of the RTC,
when affirmed by the CA, are binding
The existence of the tunnel underneath the land of
the Heirs of Macabangkit, being a factual matter,
cannot now be properly reviewed by the Court, for
questions of fact are beyond the pale of a petition
for review on certiorari. Moreover, the factual
findings and determinations by the RTC as the trial
court are generally binding on the Court,
particularly after the CA affirmed them.13 Bearing
these doctrines in mind, the Court should rightly
dismiss NPC’s appeal.
NPC argues, however, that this appeal should not
be dismissed because the Heirs of Macabangkit
essentially failed to prove the existence of the
underground tunnel. It insists that the topographic
survey map and the right-of-way map presented by
the Heirs of Macabangkit did not at all establish
the presence of any underground tunnel.
NPC still fails to convince.
Even assuming, for now, that the Court may review
the factual findings of the CA and the RTC, for NPC
to insist that the evidence on the existence of the
tunnel was not adequate and incompetent remains
futile. On the contrary, the evidence on the tunnel
was substantial, for the significance of the
topographic survey map and the sketch map (as
indicative of the extent and presence of the tunnel
construction) to the question on the existence of
the tunnel was strong, as the CA correctly
projected in its assailed decision, viz:
Among the pieces of documentary evidence
presented showing the existence of the said tunnel
beneath the subject property is the topographic
survey map. The topographic survey map is one
conducted to know about the location and
elevation of the land and all existing structures
above and underneath it. Another is the Sketch
Map which shows the location and extent of the
land traversed or affected by the said tunnel. These
two (2) pieces of documentary evidence readily
point the extent and presence of the tunnel
construction coming from the power cavern near
the small man-made lake which is the inlet and
approach tunnel, or at a distance of about two (2)
kilometers away from the land of the plaintiffs-
appellees, and then traversing the entire and the
whole length of the plaintiffs-appellees’ property,
and the outlet channel of the tunnel is another
small man-made lake. This is a sub-terrain
construction, and considering that both inlet and
outlet are bodies of water, the tunnel can hardly be
noticed. All constructions done were beneath the
surface of the plaintiffs-appellees’ property. This
explains why they could never obtain any
knowledge of the existence of such tunnel during
the period that the same was constructed and
installed beneath their property.14
The power cavern and the inlet and outlet channels
established the presence of the underground
tunnel, based on the declaration in the RTC by
Sacedon, a former employee of the NPC.15 It is
worthy to note that NPC did not deny the existence
of the power cavern, and of the inlet and outlet
channels adverted to and as depicted in the
topographic survey map and the sketch map. The
CA cannot be faulted for crediting the testimony of
Sacedon despite the effort of NPC to discount his
credit due to his not being an expert witness,
simply because Sacedon had personal knowledge
based on his being NPC’s principal engineer and
supervisor tasked at one time to lay out the
tunnels and transmission lines specifically for the
hydroelectric projects,16 and to supervise the
construction of the Agus 1 Hydroelectric Plant
itself17 from 1978 until his retirement from
NPC.18 Besides, he declared that he personally
experienced the vibrations caused by the rushing
currents in the tunnel, particularly near the outlet
channel.19 Under any circumstances, Sacedon was
a credible and competent witness.
The ocular inspection actually confirmed the
existence of the tunnel underneath the land of the
Heirs of Macabangkit. Thus, the CA observed:
More so, the Ocular inspection conducted on July
23, 1998 further bolstered such claim of the
existence and extent of such tunnel. This was
conducted by a team composed of the Honorable
Presiding Judge of the Regional Trial Court,
Branch 01, Lanao del Norte, herself and the
respective lawyers of both of the parties and found
that, among others, said underground tunnel was
constructed beneath the subject property.20
It bears noting that NPC did not raise any issue
against or tender any contrary comment on the
ocular inspection report.
2.
Five-year prescriptive period under Section 3(i) of
Republic Act No. 6395 does not apply to claims for
just compensation
The CA held that Section 3(i) of Republic Act No.
6395 had no application to this action because it
covered facilities that could be easily discovered,
not tunnels that were inconspicuously constructed
beneath the surface of the land.21
NPC disagrees, and argues that because Article
63522 of the Civil Code directs the application of
special laws when an easement, such as the
underground tunnel, was intended for public use,
the law applicable was Section 3(i) of Republic Act
No. 6395, as amended, which limits the action for
recovery of compensation to five years from the
date of construction. It posits that the five-year
prescriptive period already set in due to the
construction of the underground tunnel having
been completed in 1979 yet.
Without necessarily adopting the reasoning of the
CA, we uphold its conclusion that prescription did
not bar the present action to recover just
compensation.
Section 3 (i) of Republic Act No. 6395, the cited
law, relevantly provides:
Section 3. Powers and General Functions of the
Corporation. – The powers, functions, rights and
activities of the Corporation shall be the following:
xxx
(i) To construct works across, or otherwise, any
stream, watercourse, canal, ditch, flume, street,
avenue, highway or railway of private and public
ownership, as the location of said works may
require:Provided, That said works be constructed
in such a manner as not to endanger life or
property; And provided, further, That the stream,
watercourse, canal ditch, flume, street, avenue,
highway or railway so crossed or intersected be
restored as near as possible to their former state,
or in a manner not to impair unnecessarily their
usefulness. Every person or entity whose right of
way or property is lawfully crossed or intersected
by said works shall not obstruct any such
crossings or intersection and shall grant the Board
or its representative, the proper authority for the
execution of such work. The Corporation is hereby
given the right of way to locate, construct and
maintain such works over and throughout the
lands owned by the Republic of the Philippines or
any of its branches and political subdivisions. The
Corporation or its representative may also enter
upon private property in the lawful performance or
prosecution of its business and purposes,
including the construction of the transmission
lines thereon; Provided, that the owner of such
property shall be indemnified for any actual
damage caused thereby;Provided, further, That
said action for damages is filed within five years
after the rights of way, transmission lines,
substations, plants or other facilities shall have
been established; Provided, finally, That after said
period, no suit shall be brought to question the
said rights of way, transmission lines, substations,
plants or other facilities;
A cursory reading shows that Section 3(i) covers
the construction of "works across, or otherwise,
any stream, watercourse, canal, ditch, flume,
street, avenue, highway or railway of private and
public ownership, as the location of said works
may require." It is notable that Section 3(i) includes
no limitation except those enumerated after the
term works. Accordingly, we consider the term
works as embracing all kinds of constructions,
facilities, and other developments that can enable
or help NPC to meet its objectives of developing
hydraulic power expressly provided under
paragraph (g) of Section 3. 23 The CA’s restrictive
construal of Section 3(i) as exclusive of tunnels
was obviously unwarranted, for the provision
applies not only to development works easily
discoverable or on the surface of the earth but also
to subterranean works like tunnels. Such
interpretation accords with the fundamental
guideline in statutory construction that when the
law does not distinguish, so must we
not.24 Moreover, when the language of the statute
is plain and free from ambiguity, and expresses a
single, definite, and sensible meaning, that
meaning is conclusively presumed to be the
meaning that the Congress intended to convey.25
Even so, we still cannot side with NPC.
We rule that the prescriptive period provided under
Section 3(i) of Republic Act No. 6395 is applicable
only to an action for damages, and does not extend
to an action to recover just compensation like this
case. Consequently, NPC cannot thereby bar the
right of the Heirs of Macabangkit to recover just
compensation for their land.
The action to recover just compensation from the
State or its expropriating agency differs from the
action for damages. The former, also known as
inverse condemnation, has the objective to recover
the value of property taken in fact by the
governmental defendant, even though no formal
exercise of the power of eminent domain has been
attempted by the taking agency.26 Just
compensation is the full and fair equivalent of the
property taken from its owner by the expropriator.
The measure is not the taker’s gain, but the
owner’s loss. The word just is used to intensify the
meaning of the word compensation in order to
convey the idea that the equivalent to be rendered
for the property to be taken shall be real,
substantial, full, and ample.27 On the other hand,
the latter action seeks to vindicate a legal wrong
through damages, which may be actual, moral,
nominal, temperate, liquidated, or exemplary.
When a right is exercised in a manner not
conformable with the norms enshrined in Article
1928 and like provisions on human relations in the
Civil Code, and the exercise results to the damage
of another, a legal wrong is committed and the
wrongdoer is held responsible.29
The two actions are radically different in nature
and purpose. The action to recover just
compensation is based on the Constitution 30 while
the action for damages is predicated on statutory
enactments. Indeed, the former arises from the
exercise by the State of its power of eminent
domain against private property for public use, but
the latter emanates from the transgression of a
right. The fact that the owner rather than the
expropriator brings the former does not change the
essential nature of the suit as an inverse
condemnation,31 for the suit is not based on tort,
but on the constitutional prohibition against the
taking of property without just compensation. 32 It
would very well be contrary to the clear language of
the Constitution to bar the recovery of just
compensation for private property taken for a
public use solely on the basis of statutory
prescription.
Due to the need to construct the underground
tunnel, NPC should have first moved to acquire the
land from the Heirs of Macabangkit either by
voluntary tender to purchase or through formal
expropriation proceedings. In either case, NPC
would have been liable to pay to the owners the
fair market value of the land, for Section 3(h) of
Republic Act No. 6395 expressly requires NPC to
pay the fair market value of such property at the
time of the taking, thusly:
(h) To acquire, promote, hold, transfer, sell, lease,
rent, mortgage, encumber and otherwise dispose of
property incident to, or necessary, convenient or
proper to carry out the purposes for which the
Corporation was created: Provided, That in case a
right of way is necessary for its transmission lines,
easement of right of way shall only be sought:
Provided, however, That in case the property itself
shall be acquired by purchase, the cost thereof
shall be the fair market value at the time of the
taking of such property.
This was what NPC was ordered to do in National
Power Corporation v. Ibrahim,33 where NPC had
denied the right of the owners to be paid just
compensation despite their land being traversed by
the underground tunnels for siphoning water from
Lake Lanao needed in the operation of Agus II,
Agus III, Agus IV, Agus VI and Agus VII
Hydroelectric Projects in Saguiran, Lanao del Sur,
in Nangca and Balo-I in Lanao del Norte and in
Ditucalan and Fuentes in Iligan City. There, NPC
similarly argued that the underground tunnels
constituted a mere easement that did not involve
any loss of title or possession on the part of the
property owners, but the Court resolved against
NPC, to wit:
Petitioner contends that the underground tunnels
in this case constitute an easement upon the
property of the respondents which does not involve
any loss of title or possession. The manner in
which the easement was created by petitioner,
however, violates the due process rights of
respondents as it was without notice and
indemnity to them and did not go through proper
expropriation proceedings. Petitioner could have, at
any time, validly exercised the power of eminent
domain to acquire the easement over respondents’
property as this power encompasses not only the
taking or appropriation of title to and possession of
the expropriated property but likewise covers even
the imposition of a mere burden upon the owner of
the condemned property. Significantly, though,
landowners cannot be deprived of their right over
their land until expropriation proceedings are
instituted in court. The court must then see to it
that the taking is for public use, that there is
payment of just compensation and that there is
due process of law.34
3. NPC’s construction of the tunnel
constituted taking of the land, and
entitled owners to just compensation
The Court held in National Power Corporation v.
Ibrahim that NPC was "liable to pay not merely an
easement fee but rather the full compensation for
land" traversed by the underground tunnels, viz:
In disregarding this procedure and failing to
recognize respondents’ ownership of the sub-
terrain portion, petitioner took a risk and exposed
itself to greater liability with the passage of time. It
must be emphasized that the acquisition of the
easement is not without expense. The underground
tunnels impose limitations on respondents’ use of
the property for an indefinite period and deprive
them of its ordinary use. Based upon the foregoing,
respondents are clearly entitled to the payment of
just compensation. Notwithstanding the fact that
petitioner only occupies the sub-terrain portion, it
is liable to pay not merely an easement fee but
rather the full compensation for land. This is so
because in this case, the nature of the easement
practically deprives the owners of its normal
beneficial use. Respondents, as the owner of the
property thus expropriated, are 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.35
Here, like in National Power Corporation v.
Ibrahim, NPC constructed a tunnel underneath the
land of the Heirs of Macabangkit without going
through formal expropriation proceedings and
without procuring their consent or at least
informing them beforehand of the construction.
NPC’s construction adversely affected the owners’
rights and interests because the subterranean
intervention by NPC prevented them from
introducing any developments on the surface, and
from disposing of the land or any portion of it,
either by sale or mortgage.
Did such consequence constitute taking of the land
as to entitle the owners to just compensation?
We agree with both the RTC and the CA that there
was a full taking on the part of NPC,
notwithstanding that the owners were not
completely and actually dispossessed. It is settled
that the taking of private property for public use,
to be compensable, need not be an actual physical
taking or appropriation.36 Indeed, the
expropriator’s action may be short of acquisition of
title, physical possession, or occupancy but may
still amount to a taking.37 Compensable taking
includes destruction, restriction, diminution, or
interruption of the rights of ownership or of the
common and necessary use and enjoyment of the
property in a lawful manner, lessening or
destroying its value.38 It is neither necessary that
the owner be wholly deprived of the use of his
property,39 nor material whether the property is
removed from the possession of the owner, or in
any respect changes hands.40
As a result, NPC should pay just compensation for
the entire land. In that regard, the RTC pegged just
compensation at ₱500.00/square meter based on
its finding on what the prevailing market value of
the property was at the time of the filing of the
complaint, and the CA upheld the RTC.
We affirm the CA, considering that NPC did not
assail the valuation in the CA and in this Court.
NPC’s silence was probably due to the correctness
of the RTC’s valuation after careful consideration
and weighing of the parties’ evidence, as follows:
The matter of what is just compensation for these
parcels of land is a matter of evidence. These
parcels of land is (sic) located in the City of Iligan,
the Industrial City of the South. Witness Dionisio
Banawan, OIC- City Assessor’s Office, testified,
"Within that area, that area is classified as
industrial and residential. That plaintiffs’ land is
adjacent to many subdivisions and that is within
the industrial classification. He testified and
identified Exhibit "AA" and "AA-1", a Certification,
dated April 4, 1997, showing that the appraised
value of plaintiffs land ranges from ₱400.00 to
₱500.00 per square meter (see, TSN, testimony of
Dionisio Banawan, pp. 51, 57, and 71, February 9,
1999). Also, witness Banawan, testified and
identified Two (2) Deeds of Sale, marked as Exhibit
"AA-2" and "AA-3,["] showing that the appraised
value of the land adjoining or adjacent to plaintiff
land ranges from ₱700.00 to ₱750.00 per square
meter. As between the much lower price of the land
as testified by defendant’s witness Gregorio
Enterone, and that of the City Assessor of Iligan
City, the latter is more credible. Considering
however, that the appraised value of the land in
the area as determined by the City Assessor’s
Office is not uniform, this Court, is of the opinion
that the reasonable amount of just compensation
of plaintiff’s land should be fixed at FIVE
HUNDRED (500.00) PESOS, per square meter.
xxx.41
The RTC based its fixing of just compensation
ostensibly on the prevailing market value at the
time of the filing of the complaint, instead of
reckoning from the time of the taking pursuant to
Section 3(h) of Republic Act No. 6395. The CA did
not dwell on the reckoning time, possibly because
NPC did not assign that as an error on the part of
the RTC.
We rule that the reckoning value is the value at the
time of the filing of the complaint, as the RTC
provided in its decision. Compensation that is
reckoned on the market value prevailing at the
time either when NPC entered or when it completed
the tunnel, as NPC submits, would not be just, for
it would compound the gross unfairness already
caused to the owners by NPC’s entering without
the intention of formally expropriating the land,
and without the prior knowledge and consent of
the Heirs of Macabangkit. NPC’s entry denied
elementary due process of law to the owners since
then until the owners commenced the inverse
condemnation proceedings. The Court is more
concerned with the necessity to prevent NPC from
unjustly profiting from its deliberate acts of
denying due process of law to the owners. As a
measure of simple justice and ordinary fairness to
them, therefore, reckoning just compensation on
the value at the time the owners commenced these
inverse condemnation proceedings is entirely
warranted.
In National Power Corporation v. Court of
Appeals,42 a case that involved the similar
construction of an underground tunnel by NPC
without the prior consent and knowledge of the
owners, and in which we held that the basis in
fixing just compensation when the initiation of the
action preceded the entry into the property was the
time of the filing of the complaint, not the time of
taking,43 we pointed out that there was no taking
when the entry by NPC was made "without intent
to expropriate or was not made under warrant or
color of legal authority."
4.Awards for rentals, moral damages, exemplary
damages, and attorney’s fees are deleted
for insufficiency of factual and legal bases
The CA upheld the RTC’s granting to the Heirs of
Macabangkit of rentals of ₱ 30,000.00/month
"from 1979 up to July 1999 with 12% interest per
annum" by finding NPC guilty of bad faith in taking
possession of the land to construct the tunnel
without their knowledge and consent.
Granting rentals is legally and factually bereft of
justification, in light of the taking of the land being
already justly compensated. Conformably with the
ruling in Manila International Airport Authority v.
Rodriguez,44 in which the award of interest was
held to render the grant of back rentals
unwarranted, we delete the award of back rentals
and in its place prescribe interest of 12% interest
per annum from November 21, 1997, the date of
the filing of the complaint, until the full liability is
paid by NPC. The imposition of interest of 12%
interest per annum follows a long line of pertinent
jurisprudence,45 whereby the Court has fixed the
rate of interest on just compensation at 12% per
annum whenever the expropriator has not
immediately paid just compensation.
The RTC did not state any factual and legal
justifications for awarding to the Heirs of
Macabangkit moral and exemplary damages each
in the amount of ₱200,000.00. The awards just
appeared in the fallo of its decision. Neither did the
CA proffer any justifications for sustaining the RTC
on the awards. We consider the omissions of the
lower courts as pure legal error that we feel bound
to correct even if NPC did not submit that for our
consideration. There was, to begin with, no factual
and legal bases mentioned for the awards. It is
never trite to remind that moral and exemplary
damages, not by any means liquidated or assessed
as a matter of routine, always require evidence that
establish the circumstances under which the
claimant is entitled to them. Moreover, the failure
of both the RTC and the CA to render the factual
and legal justifications for the moral and
exemplary damages in the body of their decisions
immediately demands the striking out of the
awards for being in violation of the fundamental
rule that the decision must clearly state the facts
and the law on which it is based. Without the
factual and legal justifications, the awards are
exposed as the product of conjecture and
speculation, which have no place in fair judicial
adjudication.
We also reverse and set aside the decree of the RTC
for NPC to pay to the Heirs of Macabangkit "the
sum equivalent to 15% of the total amount
awarded, as attorney’s fees, and to pay the cost."
The body of the decision did not state the factual
and legal reasons why NPC was liable for attorney’s
fees. The terse statement found at the end of the
body of the RTC’s decision, stating: "xxx The
contingent attorney’s fee is hereby reduced from
20% to only 15% of the total amount of the claim
that may be awarded to plaintiffs," without more,
did not indicate or explain why and how the
substantial liability of NPC for attorney’s fees could
have arisen and been determined.
In assessing attorney’s fees against NPC and in
favor of the respondents, the RTC casually
disregarded the fundamental distinction between
the two concepts of attorney’s fees — the ordinary
and the extraordinary. These concepts were aptly
distinguished in Traders Royal Bank Employees
Union-Independent v. NLRC,46 thuswise:
There are two commonly accepted concepts of
attorney’s fees, the so-called ordinary and
extraordinary. In its ordinary concept, an
attorney’s fee is the reasonable compensation paid
to a lawyer by his client for the legal services he
has rendered to the latter. The basis of this
compensation is the fact of his employment by and
his agreement with the client.
In its extraordinary concept, an attorney’s fee is an
indemnity for damages ordered by the court to be
paid by the losing party in a litigation. The basis of
this is any of the cases provided by law where such
award can be made, such as those authorized in
Article 2208, Civil Code, and is payable not to the
lawyer but to the client, unless they have agreed
that the award shall pertain to the lawyer as
additional compensation or as part thereof.
By referring to the award as contingency fees, and
reducing the award from 20% to 15%, the RTC was
really referring to a supposed agreement on
attorney’s fees between the Heirs of Macabangkit
and their counsel. As such, the concept of
attorney’s fees involved was the ordinary. Yet, the
inclusion of the attorney’s fees in the judgment
among the liabilities of NPC converted the fees to
extraordinary. We have to disagree with the RTC
thereon, and we express our discomfort that the
CA did not do anything to excise the clearly
erroneous and unfounded grant.
An award of attorney’s fees has always been the
exception rather than the rule. To start with,
attorney’s fees are not awarded every time a party
prevails in a suit.47 Nor should an adverse decision
ipso facto justify an award of attorney’s fees to the
winning party.48 The policy of the Court is that no
premium should be placed on the right to
litigate.49 Too, such fees, as part of damages, are
assessed only in the instances specified in Art.
2208, Civil Code.50 Indeed, attorney’s fees are in
the nature of actual damages.51 But even when a
claimant is compelled to litigate with third persons
or to incur expenses to protect his rights,
attorney’s fees may still be withheld where no
sufficient showing of bad faith could be reflected in
a party’s persistence in a suit other than an
erroneous conviction of the righteousness of his
cause.52 And, lastly, the trial court must make
express findings of fact and law that bring the suit
within the exception. What this demands is that
the factual, legal or equitable justifications for the
award must be set forth
not only in the fallo but also in the text of the
decision, or else, the award should be thrown out
for being speculative and conjectural.53
Sound policy dictates that even if the NPC failed to
raise the issue of attorney’s fees, we are not
precluded from correcting the lower courts’
patently erroneous application of the law. 54 Indeed,
the Court, in supervising the lower courts,
possesses the ample authority to review legal
matters like this one even if not specifically raised
or assigned as error by the parties.
5.Attorney’s fees under quantum meruit principle
are fixed at 10% of the judgment award
Based on the pending motions of Atty.
Macarupung Dibaratun and Atty. Manuel D.
Ballelos to assert their respective rights to
attorney’s fees, both contending that they
represented the Heirs of Macabangkit in this case,
a conflict would ensue from the finality of the
judgment against NPC.
A look at the history of the legal representation of
the Heirs of Macabangkit herein provides a helpful
predicate for resolving the conflict.
Atty. Dibaratun was the original counsel of the
Heirs of Macabangkit. When the appeal was
submitted for decision in the CA, 55 Atty. Ballelos
filed his entry of appearance,56 and a motion for
early decision.57 Atty. Ballelos subsequently filed
also a manifestation,58 supplemental
manifestation,59
reply,60 and ex parte motion reiterating the motion
for early decision.61 It appears that a copy of the
CA’s decision was furnished solely to Atty. Ballelos.
However, shortly before the rendition of the
decision, Atty. Dibaratun filed in the CA a motion
to register attorney’s lien,62 alleging that he had not
withdrawn his appearance and had not been aware
of the entry of appearance by Atty. Ballelos. A
similar motion was also received by the Court from
Atty. Dibaratun a few days after the petition for
review was filed.63 Thus, on February 14,
2005,64 the Court directed Atty. Dibaratun to enter
his appearance herein. He complied upon filing the
comment.65
Amir Macabangkit confirmed Atty. Dibaratun’s
representation through an ex parte manifestation
that he filed in his own behalf and on behalf of his
siblings Mongkoy and Putri.66 Amir reiterated his
manifestation on March 6, 2006,67and further
imputed malpractice to Atty. Ballelos for having
filed an entry of appearance bearing Amir’s forged
signature and for plagiarism, i.e., copying verbatim
the arguments contained in the pleadings
previously filed by Atty. Dibaratun.68
On September 11, 2008, Atty. Ballelos submitted
two motions, to wit: (a) a manifestation and motion
authorizing a certain Abdulmajeed Djamla to
receive his attorney’s fees equivalent of 15% of the
judgment award,69 and (b) a motion to register his
attorney’s lien that he claimed was contingent.70
Both Atty. Dibaratun and Atty. Ballelos posited
that their entitlement to attorney’s fees was
contingent. Yet, a contract for a contingent fees is
an agreement in writing by which the fees, usually
a fixed percentage of what may be recovered in the
action, are made to depend upon the success in
the effort to enforce or defend a supposed right.
Contingent fees depend upon an express contract,
without which the attorney can only recover on the
basis of quantum meruit.71 With neither Atty.
Dibaratun nor Atty. Ballelos presenting a written
agreement bearing upon their supposed contingent
fees, the only way to determine their right to
appropriate attorney’s fees is to apply the principle
of quantum meruit.
Quantum meruit – literally meaning as much as he
deserves – is used as basis for determining an
attorney’s professional fees in the absence of an
express agreement.72 The recovery of attorney’s fees
on the basis of quantum meruit is a device that
prevents an unscrupulous client from running
away with the fruits of the legal services of counsel
without paying for it and also avoids unjust
enrichment on the part of the attorney
himself.73 An attorney must show that he is
entitled to reasonable compensation for the effort
in pursuing the client’s cause, taking into account
certain factors in fixing the amount of legal fees.74
Rule 20.01 of the Code of Professional
Responsibility lists the guidelines for determining
the proper amount of attorney fees, to wit:
Rule 20.1 – A lawyer shall be guided by the
following factors in determining his fees:
 a) The time spent and the extent of the
services rendered or required;
b) The novelty and difficult of the questions
involved;
c) The important of the subject matter;
d) The skill demanded;
e) The probability of losing other
employment as a result of acceptance of the
proffered case;
f) The customary charges for similar
services and the schedule of fees of the IBP
chapter to which he belongs;
g) The amount involved in the controversy
and the benefits resulting to the client from
the service;
h) The contingency or certainty of
compensation;
i) The character of the employment,
whether occasional or established; and
j) The professional standing of the lawyer.
In the event of a dispute as to the amount of fees
between the attorney and his client, and the
intervention of the courts is sought, the
determination requires that there be evidence to
prove the amount of fees and the extent and value
of the services rendered, taking into account the
facts determinative thereof.75 Ordinarily, therefore,
the determination of the attorney’s fees on
quantum meruit is remanded to the lower court for
the purpose. However, it will be just and equitable
to now assess and fix the attorney’s fees of both
attorneys in order that the resolution of "a
comparatively simple controversy," as Justice
Regalado put it in Traders Royal Bank Employees
Union-Independent v. NLRC,76 would not be
needlessly prolonged, by taking into due
consideration the accepted guidelines and so much
of the pertinent data as are extant in the records.
Atty. Dibaratun and Atty. Ballelos each claimed
attorney’s fees equivalent to 15% of the principal
award of ₱113,532,500.00, which was the amount
granted by the RTC in its decision. Considering
that the attorney’s fees will be defrayed by the
Heirs of Macabangkit out of their actual recovery
from NPC, giving to each of the two attorney’s 15%
of the principal award as attorney’s fees would be
excessive and unconscionable from the point of
view of the clients. Thus, the Court, which holds
and exercises the power to fix attorney’s fees on a
quantum meruit basis in the absence of an express
written agreement between the attorney and the
client, now fixes attorney’s fees at 10% of the
principal award of ₱113,532,500.00.
Whether it is Atty. Dibaratun or Atty. Ballelos, or
both, who should receive attorney’s fees from the
Heirs of Macabangkit is a question that the Court
must next determine and settle by considering the
amount and quality of the work each performed
and the results each obtained.
Atty. Dibaratun, the attorney from the outset,
unquestionably carried the bulk of the legal
demands of the case. He diligently prepared and
timely filed in behalf of the Heirs of Macabangkit
every pleading and paper necessary in the full
resolution of the dispute, starting from the
complaint until the very last motion filed in this
Court. He consistently appeared during the trial,
and examined and cross-examined all the
witnesses presented at that stage of the
proceedings. The nature, character, and substance
of each pleading and the motions he prepared for
the Heirs of Macabangkit indicated that he devoted
substantial time and energy in researching and
preparing the case for the trial. He even advanced
₱250,000.00 out of his own pocket to defray
expenses from the time of the filing of the motion
to execute pending appeal until the case reached
the Court.77 His representation of all the Heirs of
Macabangkit was not denied by any of them.
We note that Atty. Dibaratun possessed some
standing in the legal profession and in his local
community. He formerly served as a member of the
Board of Director of the Integrated Bar of the
Philippines (IBP), Lanao del Norte-Iligan City
Chapter, and was an IBP national awardee as Best
Legal Aid Committee Chairman. He taught at
Mindanao State University College of Law
Extension. He was a Municipal Mayor of
Matungao, Lanao del Norte, and was enthroned
Sultan a Gaus.
In contrast, not much about the character and
standing of Atty. Ballelos, as well as the nature
and quality of the legal services he rendered for the
Heirs of Macabangkit are in the records. The
motions he filed in the
Court and in the CA lacked enlightening research
and were insignificant to the success of the clients’
cause. His legal service, if it can be called that,
manifested no depth or assiduousness, judging
from the quality of the pleadings from him. His
written submissions in the case appeared either to
have been lifted verbatim from the pleadings
previously filed by Atty. Dibaratun, or to have been
merely quoted from the decisions and resolutions
of the RTC and the CA. Of the Heirs of
Macabangkit, only Cebu, Batowa-an, Sayana,
Nasser, Manta, Mongkoy78 and Edgar gave their
consent to Atty. Ballelos to appear in their behalf
in the CA, which he did despite Atty. Dibaratun not
having yet filed any withdrawal of his appearance.
The Court did not receive any notice of appearance
for the Heirs of Macabangkit from Atty. Ballelos,
but that capacity has meanwhile become doubtful
in the face of Amir’s strong denial of having
retained him.1avvphil
In fairness and justice, the Court accords full
recognition to Atty. Dibaratun as the counsel de
parte of the Heirs of Macabangkit who discharged
his responsibility in the prosecution of the clients’
cause to its successful end. It is he, not Atty.
Ballelos, who was entitled to the full amount of
attorney’s fees that the clients ought to pay to their
attorney. Given the amount and quality of his legal
work, his diligence and the time he expended in
ensuring the success of his prosecution of the
clients’ cause, he deserves the recognition,
notwithstanding that some of the clients might
appear to have retained Atty. Ballelos after the
rendition of a favorable judgment.79
Atty. Ballelos may claim only from Cebu, Batowa-
an, Sayana, Nasser, Manta and Edgar, the only
parties who engaged him. The Court considers his
work in the case as very minimal. His
compensation under the quantum meruit principle
is fixed at ₱5,000.00, and only the Heirs of
Macabangkit earlier named are liable to him.
WHEREFORE, the Court AFFIRMS the decision
promulgated on October 5, 2004 by the Court of
Appeals, subject to the following MODIFICATIONS,
to wit:
(a) Interest at the rate of 12% per annum is
IMPOSED on the principal amount of
₱113,532,500.00 as just compensation,
reckoned from the filing of the complaint on
November 21, 1997 until the full liability is
paid;
(b) The awards of ₱30,000.00 as rental fee,
₱200,000.00 as moral damages, and
₱200,000.00 as exemplary damages are
DELETED; and
(c) The award of 15% attorney’s fees
decreed to be paid by National Power
Corporation to the Heirs of Macabangkit is
DELETED.
The Court PARTLY GRANTS the motion to register
attorney’s lien filed by Atty. Macarupung
Dibaratun, and FIXES Atty. Dibaratun’s attorney’s
fees on the basis of quantum meruit at 10% of the
principal award of ₱113,532,500.00.
The motion to register attorney’s lien of Atty.
Manuel D. Ballelos is PARTLY GRANTED, and Atty.
Ballelos is DECLARED ENTITLED TO RECOVER
from Cebu, Batowa-an, Sayana, Nasser, Manta and
Edgar, all surnamed Macabangkit, the amount of
₱5,000.00 as attorney’s fees on the basis of
quantum meruit.
Costs of suit to be paid by the petitioner.
SO ORDERED.
G.R. No. 192100 March 12, 2014
REPUBLIC OF THE PHILIPPINES, represented
by the DEPARTMENT OF PUBLIC WORKS AND
HIGHWAYS (DPWH)1, Petitioner,
vs.
ASIA PACIFIC INTEGRATED STEEL
CORPORATION, Respondent.
DECISION
VILLARAMA, JR., J.:
Before this Court is a petition for review on
certiorari under Rule 45 of the 1997 Rules of Civil
Procedure, as amended, assailing the July 21,
2009 Decision2 of the Court of Appeals (CA) in CA-
G.R. CV No. 90539. The CA partially affirmed the
September 21, 2007 Decision3 of the Regional Trial
Court (RTC), Branch 54, of Macabebe, Pampanga,
and reduced the annual legal interest awarded
from 12% to 6% per annum. Also assailed is the
appellate court's April 28, 2010
Resolution4 denying petitioner's motion for
reconsideration.
As culled from the records, the following are the
pertinent facts:
Asia Pacific Integrated Steel Corporation
(respondent) is the registered owner of a 17,175-
square meter property situated in Barangay Sta.
Monica, Municipality of San Simon, Province of
Pampanga and covered by Transfer Certificate of
Title (TCT) No. 271813-R.5
On March 1, 2002, the Republic of the Philippines
(petitioner) through the Toll Regulatory Board
(TRB) instituted expropriation proceedings against
the respondent over a portion of their property. The
affected area, consisting of 2,024 square meters,
shall be traversed by the expansion of the San
Simon Interchange, an integral component of the
construction, rehabilitation and expansion of the
North Luzon Expressway (NLEX Project).
Subsequently, petitioner filed an urgent ex-parte
motion for issuance of writ of possession, stating
that it deposited with the Land Bank of the
Philippines (LBP) the amount of ₱607,200.00
(100% of the value of the property based on
current zonal valuation of the Bureau of Internal
Revenue [BIR]) in accordance with Section 4(a) of
Republic Act No. 89746 (R.A. 8794), and hence the
court has the ministerial duty to place petitioner in
possession pursuant to Section 2, Rule 67 of the
Rules of Civil Procedure.7
The affected lot is within the area wherein the land
use are residential, commercial, and industrial
(mixed land use), as per Vicinity Map hereto
attached as Annex "B". The area is along
MacArthur Highway, Quezon Road, Municipal and
Barangay Roads[.]
In the absence of bonafide sales transaction in the
area, the Assessor’s Office being aware of the
actual conditions of subject property decided to
use opinion values in the determination of the
current and fair market value for the purpose of
payment of just compensation.
OPINION VALUES

On March 19, 2002, the trial court issued an order A. Real Estate Brokers/Independent
granting petitioner’s motion and directing the Appraisers/Owners, etc.
Register of Deeds of Pampanga to cause the
annotation of the writ of possession on TCT No.
271813-R.8 1. Residential - ranging from ₱2,000.00 to
₱2,500.00 per square meter
In its Answer with Opposition to the Motion for
2. Commercial - ranging from ₱2,500.00 to
Issuance of Writ of Possession,9 respondent
₱3,000.00 per square meter
questioned the TRB’s authority to expropriate the
subject property and objected to petitioner’s offered
compensation which respondent deems unjust 3. Industrial - ranging from ₱1,000.00 above per
because the basis thereof - the BIR zonal valuation square meter
- was an unofficial valuation, being merely based
on an internal memorandum issued by BIR B. Banks and Financial Institutions
Revenue District No. 21, not by the Asset Valuation
Department of the BIR National Office. Respondent 1. Residential - ranging from ₱1,000.00 to
asserted that just compensation should be at ₱2,000.00 per square meter
₱3,036,000.00 or at ₱1,500.00 per square meter
plus consequential damages, considering the fair 2. Commercial - ranging from ₱2,000.00 to
market value and the industrial classification of ₱3,000.00 per square meter
the subject property.
3. Residential - ranging from ₱1,000.00 to
During the pre-trial conference, the parties agreed ₱1,500.00 per square meter
on TRB’s authority to expropriate the subject
property but disagreed as to the amount of just
Appraisal conducted by the Assessor of San Simon,
compensation. Petitioner offered to pay
Pampanga for various properties within the area,
₱607,200.00 for the portion taken but respondent
recommended an amount ranging from ₱1,000.00
made a counter-offer of ₱1,821,600.00. The parties
to ₱1,500.00, Philippine currency, per square
eventually agreed to submit the issue of just
meter, depending on their proximity to the national
compensation to three Commissioners composed of
roads, municipal roads, and barangay roads, and
the Municipal Assessor of San Simon as Chairman,
the improvement/development put in place. The
and the RTC Branch Clerk of Court and the
amount of ₱1,000.00 to ₱1,500.00 was arrived at
Register of Deeds for the Province of Pampanga as
by the undersigned commissioners due to the
Members.10
conversion of the subject property from
agricultural to industrial use as evidenced by the
On June 1, 2004, the trial court granted Order of Conversion dated July 8, 1991, issued by
respondent’s motion to withdraw the ₱607,200.00 Renato B. Padilla, Undersecretary, Department of
deposited by petitioner with the LBP as partial Agrarian Reform, a xerox copy of which is hereto
payment for just compensation.11 attached [as] Annex "C".12

On June 9, 2004, the Commissioners submitted On September 23, 2004, an ocular inspection was
their Report with the following findings and conducted in the presence of the parties’
recommendation:
representatives and their respective counsels,
during which the trial court noted the following:
1. There is an existing toll plaza on the right lane of
the expressway facing the direction of Manila with
blue colored roofing.
2. Comprised in the aforesaid toll plaza are three
toll booths. The third booth located on the extreme
right facing Manila occupies a portion of the
expropriated portion of defendant’s property.
3. The expropriated portion which is shown in a
sketch which was marked as Exhibit H is indicated
by its color: green. It has an area of 2,021 square
meters. The remaining unexpropriated portion of
defendant’s land has an area of 15,151 square
meters.
4. The unexpropriated portion of the land of
defendant is presently very much below the level of
the expressway because the expressway was
upgraded. It is immediately adjacent to the existing
expressway, located as it is, on its right side facing
Manila. It is swampy with little water.13
In its Decision, the trial court ruled as follows:
x x x Although there was no documentary evidence
attached to substantiate the opinions of the banks
and the realtors indicated in the Commissioners’
Report, the Court finds the commissioners’
recommendation of the valuation of industrial
lands at ₱1,000.00 to ₱1,500.00 to be fair, absent
any showing that the valuation is exorbitant or
otherwise unjustified. There was no fraud or
prejudice that tainted the report.
The Court finds the valuation of the Republic of the
Philippines which was pegged at Php300.00 per
square meter to be very low. The zonal valuation of
the Bureau of Internal Revenue (Exhibits A and B
with submarkings) is merely a gauge or is
necessary in the assessment of correct transfer
taxes by the said office. Furthermore the
Department Order No. 23-98 took effect only last
February 2, 1998 which was four (4) years prior to
the filing of the complaint. The same is true with
Ordinance No. 17, Series of 1994 issued by the
Sangguniang Panlalawigan of Pampanga (Exhibit
E) which was issued eight (8) years also prior to
the filing of the complaint.
Concerning the Deed of Absolute Sale (Exhibit C)
notarized on July 19, 2002, the same was undated
and pertains only to a right of way. An easement of
right of way transmits no rights except the
easement itself. Hence, the just compensation
pertaining to easement of right of way should be
lower than that in the Deed of Absolute Sale. x x x
xxxx
Using the recommendation of the three (3)
commissioners as guide, the Court finds the
amount of ONE THOUSAND THREE HUNDRED
PESOS (Php1,300.00) per square meter as just
compensation for the property subject of
expropriation.
WHEREFORE, premises considered, judgment is
rendered:
1) Ordering the plaintiff to pay the defendant in the
amount of TWO MILLION TWENTY FOUR
THOUSAND PESOS (Php2,024,000.00)
representing the net amount of just compensation
after deducting the partial payment of ₱607,200.00
based on the valuation of Php1,300.00 per square
meter on the expropriated portion of the parcel of
land [Lot 329-A of the subdivision, plan (LRC) Psd-
246403, being a portion of lot 329, San Simon,
LRC. Cad Rec. No. 1316] with an area of 2,024
square meters situated in Sta. Monica, San Simon,
Pampanga covered by Transfer Certificate of Title
No. 271813-R plus legal interest of 12% per
annum from the time of taking (March 21, 2002)
until fully paid less taxes due on the land.
2) Ordering the plaintiff to pay the costs and/or
expenses in relation to the transfer of ownership of
the property in its favor from defendant Asia Pacific
Integrated Steel Corporation.
3) Condemning the property subject of
expropriation free from all liens and encumbrances
for the construction, rehabilitation and expansion
of the North Luzon Expressway.
SO ORDERED.14
Petitioner appealed to the CA, arguing that the just
compensation should not be more than ₱300.00
per square meter and that the correct rate of
interest is 6% per annum.
The CA upheld the trial court’s ruling, reiterating
the principle that the determination of just
compensation is an inherently judicial function. It
stressed that any valuation for just compensation
laid down in statutes merely serve as guides or
factors and may not substitute the court’s own
judgment as to what amount should be awarded
and how to arrive at such amount.15
Further, the CA noted that petitioner itself
admitted that the BIR zonal valuation is only for
the purpose of determining the correct amount of
transfer taxes. It held that while BIR zonal
valuation may be a factor in determining just
compensation, the same is not a competent basis
thereof. Citing R.A. 8974, the CA pointed out the
distinction between provisional value as a
precondition for the issuance of a writ of
possession and the payment of just compensation
for the expropriated property. While the provisional
value is based on the zonal value as may be
determined by the BIR, just compensation is based
on the prevailing fair market value of the property.
Necessarily, the zonal valuation of properties is not
equivalent to their fair market value.16
After examining the records, the CA found no
reversible error in the trial court’s determination of
just compensation and held that the valuation of
₱1,500.00 per square meter is more in consonance
with the concept of just compensation based upon
due consideration of all evidence. Thus:
It is equally settled that the valuation of a property
in tax declarations cannot be a substitute to just
compensation. Elsewise stated, the market value
reflected in the tax declaration of the condemned
property is no longer conclusive. Accordingly, we
cannot appreciate the herein tax declaration in
favor of the Republic.
Further, it is uncontested that the deed of sale
dated July 19, 2002 between San Simon Realty,
Inc. and the Republic pertained only to a right of
way, hence, the value thereof should be
considerably lower. Ordinance No. 17, as correctly
found by the RTC, was issued on June 22, 1994 or
eight (8) years prior to the institution of the herein
complaint. Certainly, the valuation of properties
therein can by no means be reflective of the
current, prevailing and fair value of the subject
property. The Republic failed to present evidence to
controvert he RTC’s finding on the matter. Neither
has it shown that the property sold thereunder
shares the same features as the herein subject
property as to warrant a similar valuation. We
cannot, thus, yield to the Republic’s submission
that its evidence are the proper basis in
determining just compensation for Asia Pacific’s
property.17
However, the CA modified the rate of interest
imposed on the amount due as just compensation
from 12% to 6% in conformity with prevailing
jurisprudence.
On April 28, 2010, the CA denied petitioner’s
motion for reconsideration, stating that the
argument on valuation by petitioner was merely a
rehash of what the CA had already passed upon.
Hence, this petition assailing the CA’s affirmance
of the trial court’s award of just compensation, the
legal basis of which is allegedly insufficient.
Petitioner argues that the evidence for determining
the amount of just compensation in expropriation
cases should be on those factors provided in
Section 5 of R.A. 8974. Considering such factors
and the evidence submitted by the parties before
the trial court, petitioner maintains that just
compensation for the subject property should be
no more than the zonal valuation (₱300.00 per
square meter), and in no case should it amount to
the market value of ₱1,300.00 per square meter
adjudged by the trial and appellate courts.
Petitioner claims that such huge sum for only
2,024-square meter portion of respondent’s
17,175-square meter property, is unbelievably
433.4% more than the 1998 BIR zonal value for an
underdeveloped industrial land at the time of its
taking.
On the other hand, respondent contends that no
reversible error was committed by the CA in
affirming the trial court’s decision after considering
all the arguments raised by petitioner and the
evidence on record. It asserts that the main issue
of just compensation and the findings thereon by
the trial court as affirmed by the CA is a question
of fact which should not be disturbed by this
Court. Moreover, respondent asserts that the
determination by the trial court is entitled to the
highest respect considering that the judge has
personal knowledge of the condition of the subject
property, having conducted an ocular inspection
on September 23, 2004.
We grant the petition.
As a rule, a petition for review under Rule 45 of the
Rules of Court covers only questions of law.
Questions of fact are not reviewable and cannot be
passed upon by this Court in the exercise of its
power to review. The distinction between questions
of law and questions of fact is established. A
question of law exists when the doubt or difference
centers on what the law is on a certain state of
facts. A question of fact, on the other hand, exists
if the doubt centers on the truth or falsity of the
alleged facts.18 This being so, the findings of fact of
the CA are final and conclusive and this Court will
not review them on appeal.19
For a question to be one of law, the same must not
involve an examination of the probative value of
the evidence presented by the litigants or any of
them. The resolution of the issue must rest solely
on what the law provides on the given set of
circumstances.20 In this case, the only legal issue
raised by petitioner is whether the trial court based
its determination of just compensation on the
factors provided under existing laws and
jurisprudence.
Section 5 of R.A. 8974 enumerates the standards
for assessing the value of expropriated land taken
for national government infrastructure projects,
thus:
SECTION 5. Standards for the Assessment of the
Value of the Land Subject of Expropriation
Proceedings or Negotiated Sale. – In order to
facilitate the determination of just compensation,
the court may consider, among other well-
established factors, the following relevant
standards:
(a) The classification and use for which the
property is suited;
(b) The developmental costs for improving the land;
(c) The value declared by the owners;
(d) The current selling price of similar lands in the
vicinity;
(e) The reasonable disturbance compensation for
the removal and/or demolition of certain
improvements on the land and for the value of the
improvements thereon;
(f) The size, shape or location, tax declaration and
zonal valuation of the land;
(g) The price of the land as manifested in the ocular
findings, oral as well as documentary evidence
presented; and
(h) Such facts and events as to enable the affected
property owners to have sufficient funds to acquire
similarly-situated lands of approximate areas as
those required from them by the government, and
thereby rehabilitate themselves as early as
possible.
In this case, the trial court considered only (a) and
(d): (1) the classification of the subject property
which is located in an area with mixed land use
(commercial, residential and industrial) and the
property’s conversion from agricultural to
industrial land, and (2) the current selling price of
similar lands in the vicinity – the only factors
which the commissioners included in their Report.
It also found the commissioners’ recommended
valuation of ₱1,000.00 to ₱1,500.00 per square to
be fair and just despite the absence of
documentary substantiation as said prices were
based merely on the opinions of bankers and
realtors.
In National Power Corporation v. Manubay Agro-
Industrial Development Corporation,21 the
recommended price of the city assessor was
rejected by this Court. The opinions of the banks
and the realtors as reflected in the computation of
the market value of the property and in the
Commissioners’ Report, were not substantiated by
any documentary evidence.
Similarly, in National Power Corporation v. Diato-
Bernal,22 this Court rejected the valuation
recommended by court-appointed commissioners
whose conclusions were devoid of any actual and
reliable basis. The market values of the subject
property’s neighboring lots were found to be mere
estimates and unsupported by any corroborative
documents, such as sworn declarations of realtors
in the area concerned, tax declarations or zonal
valuation from the BIR for the contiguous
residential dwellings and commercial
establishments. Thus, we ruled that a
commissioners’ report of land prices which is not
based on any documentary evidence is manifestly
hearsay and should be disregarded by the court.
We find that the trial court did not judiciously
determine the fair market value of the subject
property as it failed to consider other relevant
factors such as the zonal valuation, tax
declarations and current selling price supported by
documentary evidence. Indeed, just compensation
must not be arrived at arbitrarily, but determined
after an evaluation of different factors.23
Just compensation is defined as the full and fair
equivalent of the property taken from its owner by
the expropriator. The measure is not the taker’s
gain, but the owner’s loss. The word "just" is used
to intensify the meaning of the word
"compensation" and to convey thereby the idea that
the equivalent to be rendered for the property to be
taken shall be real, substantial, full, and ample.
Such "just"-ness of the compensation can only be
attained by using reliable and actual data as bases
in fixing the value of the condemned
property.24 Trial courts are required to be more
circumspect in its evaluation of just compensation
due the property owner, considering that eminent
domain cases involve the expenditure of public
funds.25
We agree with the trial court that it was not bound
by the assessment report of the commissioners and
that it had the discretion to reject the same and
substitute its own judgment on its value as
gathered from the record, or it may accept the
report/recommendation of the commissioners in
toto and base its judgment thereon. However, the
decision of the court must be based on all
established rules, upon correct legal principles and
competent evidence.26The court is proscribed from
basing its judgment on speculations and surmises.
Nonetheless, we cannot subscribe to petitioner’s
argument that just compensation for the subject
property should not exceed the zonal valuation
(₱300.00 per square meter).
In Republic v. Court of Appeals,27 we held that --
The constitutional limitation of "just
compensation" is considered to be the sum
equivalent to the market value of the property,
broadly described to be the price fixed by the seller
in open market in the usual and ordinary course of
legal action and competition or the fair value of the
property as between one who receives, and one
who desires to sell, it fixed at the time of the actual
taking by the government. x x x
Zonal valuation is just one of the indices of the fair
market value of real estate. By itself, this index
cannot be the sole basis of "just compensation" in
expropriation cases.28 As this Court ruled in Leca
Realty Corporation v. Rep. of the Phils.29:
The Republic is incorrect, however, in alleging that
the values were exorbitant, merely because they
exceeded the maximum zonal value of real
properties in the same location where the subject
properties were located. The zonal value may be
one, but not necessarily the sole, index of the value
of a realty. National Power Corporation v. Manubay
Agro-Industrial held thus:
"x x x [Market value] is not limited to the assessed
value of the property or to the schedule of market
values determined by the provincial or city
appraisal committee. However, these values may
serve as factors to be considered in the judicial
valuation of the property."
The above ruling finds support in EPZA v. Dulay in
this wise:
"Various factors can come into play in the
valuation of specific properties singled out for
expropriation.1âwphi1 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, com, 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." (Emphasis supplied.)
Among the factors to be considered in arriving at
the fair market value of the property are the cost of
acquisition, the current value of like properties, its
actual or potential uses, and in the particular case
of lands, their size, shape, location, and the tax
declarations thereon. The measure is not the
taker's gain but the owner's loss.30 To be just, the
compensation must be fair not only to the owner
but also to the taker.31
It is settled that the final conclusions on the proper
amount of just compensation can only be made
after due ascertainment of the requirements set
forth under R.A. 8974 and not merely based on the
declarations of the parties.32 Since these
requirements were not satisfactorily complied with,
and in the absence of reliable and actual data as
bases in fixing the value of the condemned
property, remand of this case to the trial court is in
order.
WHEREFORE, the petition for review on certiorari
is GRANTED. The Decision dated July 21, 2009
and Resolution dated April 28, 2010 of the Court of
Appeals in CA-G.R. CV No. 90539 are hereby SET
ASIDE.
This case is remanded to the trial court for the
proper determination of just compensation, in
conformity with this Decision.
SO ORDERED.
G.R. No. 127820 July 20, 1998
MUNICIPALITY OF PARAÑAQUE, petitioner,
vs. V.M. REALTY CORPORATION, respondent.
PANGANIBAN, J.:
A local government unit (LGU), like the
Municipality of Parañaque, cannot authorize an
expropriation of private property through a mere
resolution of its lawmaking body. The Local
Government Code expressly and clearly requires an
ordinance or a local law for the purpose. A
resolution that merely expresses the sentiment or
opinion of the Municipal Council will not suffice.
On the other hand, the principle of res
judicata does not bar subsequent proceedings for
the expropriation of the same property when all the
legal requirements for its valid exercise are
complied with.
Statement of the Case
These principles are applied by this Court in
resolving this petition for review on certiorari of the
July 22, 1996 Decision 1 of the Court of
Appeals 2 in CA GR CV No. 48048, which
affirmed in toto 3 the Regional Trial Court's
August 9, 1994 Resolution. 4 The trial court
dismissed the expropriation suit as follows:
The right of the plaintiff to exercise the power
of eminent domain is not disputed. However,
such right may be exercised only pursuant to
an Ordinance (Sec. 19, R.A No. 7160). In the
instant case, there is no such ordinance passed
by the Municipal Council of Parañaque enabling
the Municipality, thru its Chief Executive, to
exercise the power of eminent domain. The
complaint, therefore, states no cause of action.
Assuming that plaintiff has a cause of action,
the same is barred by a prior judgment. On
September 29, 1987, the plaintiff filed a
complaint for expropriation involving the same
parcels of land which was docketed as Civil
Case No. 17939 of this Court (page 26, record).
Said case was dismissed with prejudice on May
18, 1988 (page 39, record). The order of
dismissal was not appealed, hence, the same
became final. The plaintiff can not be allowed
to pursue the present action without violating
the principle of [r]es [j]udicata. While defendant
in Civil Case No. 17939 was Limpan Investment
Corporation, the doctrine of res judicata still
applies because the judgment in said case (C.C.
No. 17939) is conclusive between the parties
and their successors-in-interest (Vda. de Buncio
vs. Estate of the late Anita de Leon). The herein
defendant is the successor-in-interest of
Limpan Investment Corporation as shown by
the "Deed of Assignment Exchange" executed
on June 13, 1990.
WHEREFORE, defendant's motion for
reconsideration is hereby granted. The order
dated February 4, 1994 is vacated and set
aside.
This case is hereby dismissed. No
pronouncement as to costs.
SO ORDERED. 5
Factual Antecedents
Pursuant to Sangguniang Bayan Resolution No.
93-95, Series of 1993, 6 the Municipality of
Parañaque filed on September 20, 1993, a
Complaint for expropriation 7 against Private
Respondent V.M. Realty Corporation over two
parcels of land (Lots 2-A-2 and 2-B-1 of
Subdivision Plan Psd-17917), with a combined
area of about 10,000 square meters, located at
Wakas, San Dionisio, Parañaque, Metro Manila,
and covered by Torrens Certificate of Title No.
48700. Allegedly, the complaint was filed "for
the purpose of alleviating the living conditions
of the underprivileged by providing homes for
the homeless through a socialized housing
project." 8 Parenthetically, it was also for this
stated purpose that petitioner, pursuant to
its Sangguniang Bayan Resolution No. 577,
Series of 1991, 9 previously made an offer to
enter into a negotiated sale of the property
with private respondent, which the latter did
not accept. 10
Finding the Complaint sufficient in form and
substance, the Regional Trial Court of Makati,
Branch 134, issued an Order dated January 10,
1994, 11 giving it due course. Acting on
petitioner's motion, said court issued an Order
dated February 4, 1994, 12 authorizing
petitioner to take possession of the subject
property upon deposit with its clerk of court of
an amount equivalent to 15 percent of its fair
market value based on its current tax
declaration.
On February 21, 1994, private respondent filed
its Answer containing affirmative defenses and
a counterclaim, 13 alleging in the main that (a)
the complaint failed to state a cause of action
because it was filed pursuant to a resolution
and not to an ordinance as required by RA 7160
(the Local Government Code); and (b) the cause
of action, if any, was barred by a prior judgment
or res judicata. On private respondent's
motion, its Answer was treated as a motion to
dismiss. 14 On March 24, 1991, 15 petitioner
filed its opposition, stressing that the trial
court's Order dated February 4, 1994 was in
accord with Section 19 of RA 7160, and that
the principle of res judicata was not applicable.
Thereafter, the trial court issued its August 9,
1994 Resolution 16 nullifying its February 4,
1994 Order and dismissing the case.
Petitioner's motions for reconsideration and
transfer of venue were denied by the trial court
in a Resolution dated December 2,
1994. 17 Petitioner then appealed to
Respondent Court, raising the following issues:
1. Whether or not the Resolution of the
Parañaque Municipal Council No. 93-95, Series
of 1993 is a substantial compliance of the
statutory requirement of Section 19, R.A. 7180
[sic] in the exercise of the power of eminent
domain by the plaintiff-appellant.
2. Whether or not the complaint in this case
states no cause of action.
3. Whether or not the strict adherence to the
literal observance to the rule of procedure
resulted in technicality standing in the way of
substantial justice.
4. Whether or not the principle of res
judicata is applicable to the present case. 18
As previously mentioned, the Court of Appeals
affirmed in toto the trial court's Decision.
Respondent Court, in its assailed Resolution
promulgated on January 8, 1997, 19 denied
petitioner's Motion for Reconsideration for lack
of merit.
Hence, this appeal. 20
The Issues
Before this Court, petitioner posits
issues, viz.:
1. A resolution duly approved by the municipal
council has the same force and effect of an
ordinance and will not deprive an expropriation
case of a valid cause of action.
2. The principle of res judicata as a ground for
dismissal of case is not applicable when public
interest is primarily involved. 21
The Court's Ruling
The petition is not meritorious.
First Issue:
Resolution Different from an Ordinance
Petitioner contends that a resolution approved
by the municipal council for the purpose of
initiating an expropriation case "substantially
complies with the requirements of the
law" 22 because the terms "ordinance" and
"resolution" are synonymous for "the purpose of
bestowing authority [on] the local government
unit through its chief executive to initiate the
expropriation proceedings in court in the
exercise of the power of eminent
domain." 23 Petitioner seeks to bolster this
contention by citing Article 36, Rule VI of the
Rules and Regulations Implementing the Local
Government Code, which provides. "If the LGU
fails to acquire a private property for public
use, purpose, or welfare through purchase, the
LGU may expropriate said property through
a resolution of the Sanggunian authorizing its
chief executive to initiate expropriation
proceedings." 24 (Emphasis supplied.)
The Court disagrees. The power of eminent
domain is lodged in the legislative branch of
government, which may delegate the exercise
thereof to LGUs, other public entities and
public utilities. 25 An LGU may therefore
exercise the power to expropriate private
property only when authorized by Congress and
subject to the latter's control and restraints,
imposed "through the law conferring the power
or in other legislations." 26 In this case, Section
19 of RA 7160, which delegates to LGUs the
power of eminent domain, also lays down the
parameters for its exercise. It provides as
follows:
Sec. 19. Eminent Domain. A local government
unit may, through its chief executive and
acting pursuant to an ordinance, exercise the
two power of eminent domain for public use, or
purpose, or welfare for the benefit of the poor
and the landless, upon payment of just
compensation, pursuant to the provisions of
the Constitution and pertinent
laws: Provided, however, That the power of
eminent domain may not be exercised unless a
valid and definite offer has been previously
made to the owner, and such offer was not
accepted: Provided, further, That the local
government unit may immediately take
possession of the property upon the filing of
the expropriation proceedings and upon making
a deposit with the proper court of at least
fifteen percent (15%) of the fair market value of
the property based on the current tax
declaration of the property to be
expropriated: Provided, finally, That, the
amount to be paid for the expropriated property
shall be determined by the proper court, based
on the fair market value at the time of the
taking of the property. (Emphasis supplied)
Thus, the following essential requisites must
concur before an LGU can exercise the power of
eminent domain:
1. An ordinance is enacted by the local
legislative council authorizing the local chief
executive, in behalf of the LGU, to exercise the
power of eminent domain or pursue
expropriation proceedings over a particular
private property.
2. The power of eminent domain is exercised
for public use, purpose or welfare, or for the
benefit of the poor and the landless.
3. There is payment of just compensation, as
required under Section 9, Article III of the
Constitution, and other pertinent laws.
4. A valid and definite offer has been previously
made to the owner of the property sought to be
expropriated, but said offer was not accepted. 27
In the case at bar, the local chief executive
sought to exercise the power of eminent
domain pursuant to a resolution of the
municipal council. Thus, there was no
compliance with the first requisite that the
mayor be authorized through an ordinance.
Petitioner cites Camarines Sur vs. Court of
Appeals 28 to show that a resolution may suffice
to support the exercise of eminent domain by
an LGU. 29 This case, however, is not in point
because the applicable law at that time was BP
337, 30 the previous Local Government Code,
which had provided that a mere resolution
would enable an LGU to exercise eminent
domain. In contrast, RA 7160, 31 the present
Local Government Code which was already in
force when the Complaint for expropriation was
filed, explicitly required an ordinance for this
purpose.
We are not convinced by petitioner's insistence
that the terms "resolution" and "ordinance" are
synonymous. A municipal ordinance is different
from a resolution. An ordinance is a law, but a
resolution is merely a declaration of the
sentiment or opinion of a lawmaking body on a
specific matter. 32 An ordinance possesses a
general and permanent character, but a
resolution is temporary in nature. Additionally,
the two are enacted differently — a third
reading is necessary for an ordinance, but not
for a resolution, unless decided otherwise by a
majority of all the Sanggunian members. 33
If Congress intended to allow LGUs to exercise
eminent domain through a mere resolution, it
would have simply adopted the language of the
previous Local Government Code. But Congress
did not. In a clear divergence from the previous
Local Government Code, Section 19 of RA 7160
categorically requires that the local chief
executive act pursuant to an ordinance. Indeed,
"[l]egislative intent is determined principally
from the language of a statute. Where the
language of a statute is clear and unambiguous,
the law is applied according to its express
terms, and interpretation would be resorted to
only where a literal interpretation would be
resorted to only where a literal interpretation
would be either impossible or absurd or would
lead to an injustice." 34 In the instant case,
there is no reason to depart from this rule,
since the law requiring an ordinance is not at
all impossible, absurd, or unjust.
Moreover, the power of eminent domain
necessarily involves a derogation of a
fundamental or private right of the
people. 35 Accordingly, the manifest change in
the legislative language — from "resolution"
under BP 337 to "ordinance" under RA 7160 —
demands a strict construction. "No species of
property is held by individuals with greater
tenacity, and 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 doubtful
interpretation." 36
Petitioner relies on Article 36, Rule VI of the
Implementing Rules, which requires only a
resolution to authorize an LGU to exercise
eminent domain. This is clearly misplaced,
because Section 19 of RA 7160, the law itself,
surely prevails over said rule which merely
seeks to implement it. 37 It is axiomatic that
the clear letter of the law is controlling and
cannot be amended by a mere administrative
rule issued for its implementation. Besides,
what the discrepancy seems to indicate is a
mere oversight in the wording of the
implementing rules, since Article 32, Rule VI
thereof, also requires that, in exercising the
power of eminent domain, the chief executive
of the LGU act pursuant to an ordinance.
In this ruling, the Court does not diminish the
policy embodied in Section 2, Article X of the
Constitution, which provides that "territorial
and political subdivisions shall enjoy local
autonomy." It merely upholds the law as worded
in RA 7160. We stress that an LGU is created by
law and all its powers and rights are sourced
therefrom. It has therefore no power to amend
or act beyond the authority given and the
limitations imposed on it by law. Strictly
speaking, the power of eminent domain
delegated to an LGU is in reality not eminent
but "inferior" domain, since it must conform to
the limits imposed by the delegation, and thus
partakes only of a share in eminent
domain. 38 Indeed, "the national legislature is
still the principal of the local government units,
which cannot defy its will or modify or violate
it." 39
Complaint Does Not
State a Cause of Action
In its Brief filed before Respondent Court,
petitioner argues that its Sangguniang
Bayan passed an ordinance on October 11,
1994 which reiterated its Resolution No. 93-35,
Series of 1993, and ratified all the acts of its
mayor regarding the subject expropriation. 40
This argument is bereft of merit. In the first
place, petitioner merely alleged the existence of
such an ordinance, but it did not present any
certified true copy thereof. In the second place,
petitioner did not raise this point before this
Court. In fact, it was mentioned by private
respondent, and only in passing. 41 In any
event, this allegation does not cure the
inherent defect of petitioner's Complaint for
expropriation filed on September 23, 1993. It is
hornbook doctrine that
. . . in a motion to dismiss based on the ground
that the complaint fails to state a cause of
action, the question submitted before the court
for determination is the sufficiency of the
allegations in the complaint itself. Whether
those allegations are true or not is beside the
point, for their truth is hypothetically admitted
by the motion. The issue rather is: admitting
them to be true, may the court render a valid
judgment in accordance with the prayer of the
complaint? 42
The fact that there is no cause of action is
evident from the face of the Complaint for
expropriation which was based on a mere
resolution. The absence of an ordinance
authorizing the same is equivalent to lack of
cause of action. Consequently, the Court of
Appeals committed no reversible error in
affirming the trial court's Decision which
dismissed the expropriation suit.
Second Issue:
Eminent Domain Not Barred by Res Judicata
As correctly found by the Court of
Appeals 43 and the trial court, 44 all the
requisites for the application of res judicata are
present in this case. There is a previous final
judgment on the merits in a prior expropriation
case involving identical interests, subject
matter and cause of action, which has been
rendered by a court having jurisdiction over it.
Be that as it may, the Court holds that the
principle of res judicata, which finds
application in generally all cases and
proceedings, 45 cannot bar the right of the State
or its agent to expropriate private property. The
very nature of eminent domain, as an inherent
power of the State, dictates that the right to
exercise the power be absolute and unfettered
even by a prior judgment or res judicata. The
scope of eminent domain is plenary and, like
police power, can "reach every form of property
which the State might need for public
use." 46 "All separate interests of individuals in
property are held of the government under this
tacit agreement or implied reservation.
Notwithstanding the grant to individuals, the
eminent domain, the highest and most exact
idea of property, remains in the government, or
in the aggregate body of the people in their
sovereign capacity; and they have the right to
resume the possession of the property
whenever the public interest requires
it." 47 Thus, the State or its authorized agent
cannot be forever barred from exercising
said right by reason alone of previous non-
compliance with any legal requirement.
While the principle of res judicata does not
denigrate the right of the State to exercise
eminent domain, it does apply to specific issues
decided in a previous case. For example, a final
judgment dismissing an expropriation suit on
the ground that there was no prior offer
precludes another suit raising the same issue; it
cannot, however, bar the State or its agent from
thereafter complying with this requirement, as
prescribed by law, and subsequently exercising
its power of eminent domain over the same
property. 48 By the same token, our ruling that
petitioner cannot exercise its delegated power
of eminent domain through a mere resolution
will not bar it from reinstituting similar
proceedings, once the said legal requirement
and, for that matter, all others are properly
complied with. Parenthetically and by parity of
reasoning, the same is also true of the principle
of "law of the case." In Republic vs. De
Knecht, 49 the Court ruled that the power of the
State or its agent to exercise eminent domain is
not diminished by the mere fact that a prior
final judgment over the property to be
expropriated has become the law of the case as
to the parties. The State or its authorized agent
may still subsequently exercise its right to
expropriate the same property, once all legal
requirements are complied with. To rule
otherwise will not only improperly diminish the
power of eminent domain, but also clearly
defeat social justice.

WHEREFORE, the petition is hereby DENIED

without prejudice to petitioner's proper
exercise of its power of eminent domain over
subject property. Costs against petitioner.

SO ORDERED.