Constitutional Law 2 (Case Digests) Part 2

American Print Works v. Lawrence, 23 N.J.L.590 Facts: The mayor of New York was sued for damages by the owner of a building which he had ordered blasted to stay the great fire of 1853. The plaintiff contended that the action is one of expropriation for which he was entitled to payment of just compensation. Issue: WON the action of the mayor is considered as expropriation. Held: The destruction of the property in question does not come under the right of eminent domain, but under the right of necessity, or self-preservation. The right of eminent domain is a public right; it arises from the laws of society and is vested in the state or its grantee, acting under the right and power of the state, or benefit of the state, those acting under it. The right of necessity arises under the laws of the society or society itself. It is the right of selfdefense, of self-preservation, whether applied to persons or to property. It is a private right vested in the individual, and with which the right of the state or state necessity has nothing to do. In the case at bar, the petitioner cannot claim just compensation because the destruction is not a form of taking contemplated in the exercise of power of eminent domain. However, he can recover indemnification for damages from those who benefited. La Orden de PP. Benedictinos de Filipinas, a domestic religious corporation that owns the San Beda College, a private educational institution situated on Mendiola street. Not having been able to reach an agreement on the matter with the owner, the Government instituted the present expropriation proceedings. On May 27, 1957 the trial court, upon application of the Government — hereinafter referred to as appellant — issued an order fixing the provisional value of the property in question at P270,000.00 and authorizing appellant to take immediate possession thereof upon depositing said amount. The deposit having been made with the City Treasurer of Manila, the trial court issued the corresponding order directing the Sheriff of Manila to place appellant in possession of the property aforesaid. On June 8, 1957, as directed by the Rules of Court, the herein appellee, in lieu of an answer, filed a motion to dismiss the complaint based on the following grounds: I. That the property sought to be expropriated is already dedicated to public use and therefore is not subject to expropriation. II. That there is no necessity for the proposed expropriation. REPUBLIC OF THE PHILIPPINES, plaintiff-appellant, vs. LA ORDEN DE PP. BENEDICTINOS DE FILIPINAS, defendant-appellee. III. That the proposed Azcarraga Extension could pass through a different site which would entail less expense to the Government and which would not necessitate the expropriation of a property dedicated to education. Office of the Solicitor General for plaintiff-appellant. Ledesma, Puno, Guytingco, Antonio and Associates for defendant-appellee. IV. That the present action filed by the plaintiff against the defendant is discriminatory. DIZON, J.: V. That the herein plaintiff does not count with sufficient funds to push through its project of constructing the proposed Azcarraga Extension and to allow the plaintiff to expropriate defendant's property at this time would be only to needlessly deprive the latter of the use of its property.". To ease and solve the daily traffic congestion on Legarda Street, the Government drew plans to extend Azcarraga street from its junction with Mendiola street, up to the Sta. Mesa Rotonda, Sampaloc, Manila. To carry out this plan it offered to buy a portion of approximately 6,000 square meters of a bigger parcel belonging to The government filed a written opposition to the motion to dismiss (Record on Appeal, pp. 30-37) while appellee filed a reply thereto (Id., pp. 38-48). On July 29, 1957, without receiving evidence upon the questions of fact arising from the complaint, the motion to dismiss and the opposition thereto filed, the trial court issued the appealed order dismissing the case. The appealed order shows that the trial court limited itself to deciding the point of whether or not the expropriation of the property in question is necessary (Rec. on Ap., p. 50) and, having arrived at the conclusion that such expropriation was not of extreme necessity, dismissed the proceedings. It is to be observed that paragraph IV of the complaint expressly alleges that appellant needs, among other properties, the portion of appellee's property in question for the purpose of constructing the Azcarraga street extension, and that paragraph VII of the same complaint expressly alleges that, in accordance with Section 64(b) of the Revised Administrative Code, the President of the Philippines had authorized the acquisition, thru condemnation proceedings, of the aforesaid parcel of land belonging to appellee, as evidenced by the third indorsement dated May 15, 1957 of the Executive Secretary, Office of the President of the Philippines, a copy of which was attached to the complaint as Annex "C" and made an integral part thereof. In denial of these allegations appellee's motion to dismiss alleged that "there is no necessity for the proposed expropriation". Thus, the question of fact decisive of the whole case arose. It is the rule in this jurisdiction that private property may be expropriated for public use and upon payment of just compensation; that condemnation of private property is justified only if it is for the public good and there is a genuine necessity therefor of a public character. Consequently, the courts have the power to inquire into the legality of the exercise of the right of eminent domain and to determine whether or not there is a genuine necessity therefor (City of Manila vs. Chinese Community, 40 Phil. 349; Manila Railroad Company vs. Hacienda Benito, Inc., 37 O.G. 1957). Upon the other hand, it does not need extended argument to show that whether or not the proposed opening of the Azcarraga extension is a necessity in order to relieve the daily congestion of traffic on Legarda St., is a question of fact dependent not only upon the facts of which the trial court very liberally took judicial notice but also up on other factors that do not appear of record and must, therefore, be established by means of evidence. We are, therefore, of the opinion that the parties should have been given an opportunity to present their respective evidence upon these factors and others that might be of direct or indirect help in determining the vital question of fact involved, namely, the need to open the extension of Azcarraga street to ease and solve the traffic congestion on Legarda street. WHEREFORE, the appealed order of dismissal is set aside and the present case is remanded to the trial court for further proceedings in accordance with this decision. Without costs CITY OF MANILA VS. CHINESE COMMUNITY [40 Phil 349; No. 14355; 31 Oct 1919] Saturday, January 31, 2009 Posted by Coffeeholic Writes Labels: Case Digests, Political Law Facts: The City of Manila, plaintiff herein, prayed for the expropriation of a portion private cemetery for the conversion into an extension of Rizal Avenue. Plaintiff claims that it is necessary that such public improvement be made in the said portion of the private cemetery and that the said lands are within their jurisdiction. Defendants herein answered that the said expropriation was not necessary because other routes were available. They further claimed that the expropriation of the cemetery would create irreparable loss and injury to them and to all those persons owing and interested in the graves and monuments that would have to be destroyed. The lower court ruled that the said public improvement was not necessary on the particular-strip of land in question. Plaintiff herein assailed that they have the right to exercise the power of eminent domain and that the courts have no right to inquire and determine the necessity of the expropriation. Thus, the same filed an appeal. Issue: Whether or not the courts may inquire into, and hear proof of the necessity of the expropriation. Sometime in 1933, the defendant PLDT entered into an agreement with RCA Communications Inc., an American corporation, whereby telephone messages coming from the US and received by RCA’s domestic station, could automatically be transferred to the lines of PLDT, and vice versa. The plaintiff through the Bureau of Telecommunications, after having set up its own Government Telephone System, by utilizing its own appropriation and equipment and by renting trunk lines of the PLDT, entered into an agreement with RCA for a joint overseas telephone service. Alleging that plaintiff is in competition with them, PLDT notified the former and receiving no reply, disconnected the trunk lines being rented by the same; thus, prompting the plaintiff to file a case before the CFI praying for judgment commanding PLDT to execute a contract with the Bureau for the use of the facilities of PLDT’s telephone system, and for a writ of preliminary injunction against the defendant to restrain the severance of the existing trunk lines and restore those severed. ISSUE: Held: The courts have the power of restricting the exercise of eminent domain to the actual reasonable necessities of the case and for the purposes designated by the law. The moment the municipal corporation or entity attempts to exercise the authority conferred, it must comply with the conditions accompanying the authority. The necessity for conferring the authority upon a municipal corporation to exercise the right of eminent domain is admittedly within the power of the legislature. But whether or not Whether or not the defendant PLDT can be compelled to enter into a contract with the plaintiff. HELD: “ x x x while the Republic may not compel the PLDT to celebrate a contract with it, the Republic may, in the exercise of the sovereign power of eminent domain, require the telephone company to permit interconnection of the government telephone system and that of the PLDT, as the needs of the government service may require, subject to the payment of just compensation to be determined by the court.” the municipal corporation or entity is exercising the right in a particular case under the conditions imposed by the general authority, is a question that the courts have the right to inquire to. Republic vs. PLDT (1969) FACTS: Republic v PLDT Facts: PLDT and RCA Communications Inc (which is not a party to this case but has contractual relations with e parties) entered into an agreement where telephone messages, coming from the US and received by RCA's domestic station could automatically be transferred to the lines of PLDT and vice versa. PLDT has the priority preference in the operation of such service. the NTC. Since this relationship has been maintained for a long time and the public has patronized both telephone systems. operate and maintain a Cellular Mobile Telephone System in Metro Manila now ETCI in accordance with specific conditions on the following grounds.The Bureau of Telecommunications set up its own Government Telephone System (GTS) by renting the trunk lines of PLDT to enable government offices to call private parties. and harmful duplication. PLDT would sever the connections -which PLDT did. 1990 FACTS: a. No. despite its knowledge that the plaintiff had extended the use of the trunk lines to commercial purposes. maintained its ruling that liberally construed.R. PLDT alleged essentially that the interconnection ordered was in violation of due process and that the grant of provisional authority was jurisdictionally and procedurally infirm. will result in needless. One of the many rules prohibits the use of the service for his private use. Subsequently. Issue: Whether or not Republic can command PLDT to execute the contract. and 4. to install and operate a Cellular Mobile Telephone System for domestic and international service not only in Manila but also in the provinces and that under the “prior operator” or “protection of investment” doctrine. . implies assent by the defendant to such extended use. for the use of the facilities of defendant's telephone system throughout the Philippines under such terms and conditions as the court finds it reasonable. The acceptance by the defendant of the payment of rentals. the provisional authority. through the Bureau. it is too late for the defendant to claim misuse of its facilities. 88404 October 18. PLDT vs NTC G. After evaluating the consideration sought by the PLDT. among others. b. Held: No. and it is not now at liberty to unilaterally sever the physical connection of the trunk lines. However. To uphold PLDT's contention is to subordinate the needs of the general public. 2. 1. defendant knew or should have known that their use by the subscriber was more or less public and all embracing in nature. The Bureau was created in pursuance of a state policy reorganizing the government offices to meet the exigencies attendant upon the establishment of a free Gov't of the Phil. Petitioner assails two (2) orders of public respondent National Telecommunications Commission granting private respondent Express Telecommunications (ETCI) provisional authority to install. uneconomical. PLDT complained that the Bureau was violating the conditions for using the trunk lines not only for the use of government offices but even to serve private persons or the general public. When the Bureau subscribed to the trunk lines. Republic of the Philippines entered into an agreement with RCA for a joint overseas telephone service where the Bureau would convey radio-telephone overseas calls received by the RCA's station to and from local residents. NTC denied the reconsideration. PLDT gave a notice that if violations were not stopped. and their interconnection is to the public convenience. PLDT has its pending application with NTC Case No 86-86. 3. applicant’s franchise carries with it the privilege to operate and maintain a cellular mobile telephone service. ETCI is not capacitated or qualified under its legislative franchise to operate a system-wide telephone or network of telephone service such as the one proposed in its application. if granted. ETCI lacks the facilities needed and indispensable to the successful operation of the proposed cellular mobile telephone system. Republic sued PLDT commanding PLDT to execute a contract. ISSUE: Whether or not the compensation should be determined as of 1947 or 1959. or whether the right to enjoy such privilege has been forfeited by non-user. No. with the corresponding relay stations for the reception and transmission of wireless messages on radiotelegraphy and/or radiotelephony d." Such regulation of the use and ownership of telecommunications systems is in the exercise of the plenary police power of the State for the promotion of the general welfare. mandates interconnection providing as it does that "all domestic telecommunications carriers or utilities ... There can be no question that the NTC is the regulatory agency of the national government with jurisdiction over all telecommunications entities. belongs to the State "upon complaint or otherwise" (Sections 1. Rule 66. is more properly the subject of the prerogative writ of quo warranto. shall be interconnected to the public switch telephone network. Republic of the Philippines vs. What transpired in ETCI were a series of transfers of shares starting in 1964 until 1987. not Congressional authorization. Rep. or the Municipal Telephone Act of 1989. In 1959. De Castellvi. She then instituted an ejectment proceeding against the AFP. however. 6849. The determination of the right to the exercise of a franchise. Carmen M. aeronautical and land mobile stations. PLDT cannot justifiably refuse to interconnect. . Rules of Court). b. The 1987 Constitution recognizes the existence of that power when it provides. the republic commenced the expropriation proceedings for the land in question. entered into a lease agreement over a land in Pampanga with Castellvi on a year-to-year basis. Petition is dismissed for lack of merit. 2 and 3. establishing and operating in the entire Philippines radio stations for reception and transmission of messages on radio stations in the foreign and domestic public fixed point-to-point and public base. 2090 grants ETCI (formerly FACI) "the right and privilege of constructing. When Castellvi gave notice to terminate the lease in 1956. c. installing. NTC may. approved on 8 February 1990. G. It is legally clothed with authority and given ample discretion to grant a provisional permit or authority. the republic. A franchise is a property right and cannot be revoked or forfeited without due process of law. A forfeiture of a franchise will have to be declared in a direct proceeding for the purpose brought by the State because a franchise is granted by law and its unlawful exercise is primarily a concern of Government. ISSUES: Whether or not the contention of PLDT is tenable. L-20620 August 15. Rep. RULING: The Supreme Court ruled that the “taking” should not be .000.R. e.00 that were erected and already established on the property. on its own initiative. In fact. Act No. RULING: a. as a rule.f. 1974 Case Digest FACTS: In 1947. Vda. 2 the reason being that the abuse of a franchise is a public wrong and not a private injury.. et al. The approval of the NTC may be deemed to have been met when it authorized the issuance of the provisional authority to ETCI. Transfers of shares of a public utility corporation need only NTC approval.. through the Armed Forces of the Philippines (AFP). the AFP refused because of the permanent installations and other facilities worth almost P500. Act No. grant such relief even in the absence of a motion from an applicant. the right to assert which. unless on a presentment or indictment of a grand jury. Issue: Whether or not Causby was owed compensation under the Takings Clause (U. 1959. the noise was startling. The “taking” of the Castellvi property for the purposes of determining the just compensation to be paid must. In 1942. therefore. and the glare from their landing lights lighted the place up brightly at night. In the instant case. or . or takes place subsequent to the filing of the complaint for eminent domain.S. However it made no finding as to the precise nature or duration of the easement. 63 feet above the barn and 18 feet above the highest tree. 3. nor shall be compelled in any criminal case to be a witness against himself. the United States (defendant) began using this airport for frequent and regular military flights. which passed directly over Causby’s property at 83 feet. Because the government had taken the easement through private property. on August 10. 4. Constitutional Amendment V) Ruling: Under Sec. § 180) where Congress defined the "navigable airspace" in the public domain. The court of claims held that the United States had taken an easement over the property. “just compensation” is to be determined as of the date of the filing of the complaint. Causby was owed compensation under the Takings Clause (U.000 for the easement and resulting property damage. Causby (plaintiff) owned a dwelling and a chicken farm near a municipal airport in Greensboro. 4. aircraft.S. and that just compensation should not be determined on the basis of the value of the property as of that year. 328 U. when in actual service in time of war or public danger. as that above the "minimum safe altitude" which varies from 500 to 1000 feet depending on time of day. They frequently came so close to respondents' property that they barely missed the tops of trees. The entry must be for more than a momentary period. Causby. a form of property right. and 5.reckoned as of 1947. NC. the court determined the flight path was an easement. The property must be devoted for public use or otherwise informally appropriated or injuriously affected. liberty. The requisites for taking are: 1. Since the aircraft passing over Causby's property were at 83 feet. United States v. 2. nor be deprived of life. except in cases arising in the land or naval forces. The Supreme Court has ruled that when the taking of the property sought to be expropriated coincides with the commencement of the expropriation proceedings. or in the militia. by authority of court. 1959 when the complaint for eminent domain was filed.C. therefore. the just compensation should be determined as of the date of the filing of the complaint. and type of terrain. it is undisputed that the Republic was placed in possession of the Castellvi property. Only requisites 1. This led to the death of 150 chickens which destroyed the use of the property as a chicken farm and caused loss of sleep. nervousness. 3.S. which was 67 feet above the house. It must be under warrant or color of authorities. Constitutional Amendment V) Amendment V: “No person shall be held to answer for a capital.S. and fright on the part of respondents. and granted an award of $2. and 4 were present. nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb. The utilization of the property for public use must be such a way as to oust the owner and deprive him of beneficial enjoyment of the property. It is clear. that the "taking" of Catellvi's property for purposes of eminent domain cannot be considered to have taken place in 1947 when the Republic commenced to occupy the property as lessee thereof. The majority opinion cited the law (49 U. They sued in the Court of Claims to recover for an alleged taking of their property and for damages to their poultry business. 256 (1946) Facts Yes. The expropriator must enter a private property. Rule 67 of the Rules of Court. or otherwise infamous crime. be reckoned as of June 26. property. NPC appealed but the same was denied due to failure to file and perfect its appeal within the prescribed period. without just compensation. et al. however. which was granted by the lower court. 264-267. NPC filed an urgent ex parte motion for the issuance of writ of possession of the lands. S. ISSUE: FACTS: National Power Corporation (NPC) filed a case for expropriation against Petrona O. Whether or not RTC abused its authority by misapplying the rules governing fair valuation HELD: In finding that the trial court did not abuse its authority in evaluating the evidence and the reports placed before it nor did it misapply the rules governing fair valuation.66 per square meter.” Flights of aircraft over private land which are so low and frequent as to be a direct and immediate interference with the enjoyment and use of the land are as much an appropriation of the use of the land as a more conventional entry upon it. the CA affirmed the lower court‘s decision. A motion for execution of judgment was subsequently filed by Dilao. before Regional Trial Court of Cebu. Physical invasion of the property was not necessary where there was an intrusion so immediate and direct as to subtract from respondents' full enjoyment and use of the property. et al. is binding on the parties as well as this Court. the damages were not merely consequential. they were the product of a direct invasion of respondents' domain. It appointed 3 Board of Commissioners to determine just compensation. NPC asserted that Digao. NPC vs Aguirre Paderanga et al. It added that the lots were of no use to its operations except for its transmission lines. the Court of Appeals found the majority report‘s valuation of P500 per square meter to be fair. The United States Supreme Court reversed and remanded the action. Hence. S. 6395 which provides that the just compensation for right-of-way easement shall be equivalent to ten percent (10%) of the market value of the property. 261-262. The court remanded the case for a determination of the necessary findings regarding the nature of the easement. Said factual finding of the Court of Appeals.66 per square meter. NPC filed an opposition assailing the correctness of the appraisal for failing to take into account Republic Act No. Pp. on the basis that the record was not clear whether the easement taken was temporary or permanent. et al. 328 U. The RTC rendered its decision ordering NPC to pay fair market value at P516. Further. this petition. Expropriation was instituted to implement Leyte-Cebu Interconnection Project. 328 U. However. The RTC issued an order granting NPC‘s motion. A day after the complaint was filed. The board recommended appraisal of parcel of land co-owned by Dilao. absent any showing that the valuation is exorbitant or otherwise unjustified. at P516. involving parcels of land located in Cebu. On appeal. could still use the traversed land for agricultural purposes. nor shall private property be taken for public use. without due process of law. subject only to its easement. Dilao. . Aside from the actual damage done to the property traversed by the transmission lines.66 per square meter. 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. also falls within the ambit of the term ―expropriation. 6118. Ericta. WITHIN THE JURISDICTION OF QUEZON CITY AND PROVIDING PENALTIES FOR THE VIOLATION THEREOF”. It deprives a person of his private property without FACTS: due process of law. to be determined by competent City Authorities. They further argue that the Quezon City Council is authorized under its charter. which was approved by the trial court. and for the protection of property therein. in the exercise of local police power. MAINTENANCE AND OPERATION percent of the total area of all private cemeteries for charity burial Quezon City enacted an ordinance entitled grounds of deceased paupers and the promotion of health. to be just and reasonable compensation for the expropriated property of Dilao and her siblings.‘s property. . comfort and convenience of the city and the inhabitants thereof. promote the prosperity. ” to make such further ordinances and resolutions not repugnant to The determination of just compensation in expropriation proceedings being a judicial function. morals. nay. the Court finds the commissioners‘ recommendation of P516. even without compensation. invoking police power. QC justified the law by From the Commissioner‘s report it cannot be gainsaid that NPC‘s complaint merely involves a simple case of mere passage of transmission lines over Dilao et al. as in the present case.It City of Quezon v.” ISSUE: Whether or not the ordinance is valid. Series of 1964 of Quezon City is not a mere police regulation but an outright confiscation. peace. good order. expropriation is not limited to the acquisition of real property with a corresponding transfer of title or possession. Petitioners argue that the taking of the respondent’s property is a valid and reasonable exercise of police power and that the land is taken for a public use as it is intended for the burial ground of paupers. improve the morals. 122 SCRA 759 seems to the court that Section 9 of Ordinance No.OF PRIVATE MEMORIAL TYPE CEMETERY OR BURIAL GROUND Indeed.There is no “ORDINANCE reasonable relation between the setting aside of at least six (6) REGULATING THE ESTABLISHMENT. The law basically provides that at least six (6) percent of the total area of the memorial park cemetery shall be set aside for charity burial of deceased persons who are paupers and have been residents of Quezon City for at least 5 years prior to their death. The right-of-way easement resulting in a restriction or limitation on property rights over the land traversed by transmission lines. HELD: The SC held the law as an invalid exercise of police power. the agricultural and economic activity normally undertaken on the entire property is unquestionably restricted and perpetually hampered as the environment is made dangerous to the occupant‘s life and limb. or the general welfare of the people. By virtue of this resolution. (b) that the complaints for expropriation be dismissed. safety. Issue: 1) Whether or not the resolution is null and void. and (c) that the order denying the motion to dismiss and allowing the Province of Camarines Sur to take possession of the property subject of the expropriation and the order dated February 26. Camarines Sur. TOPIC: Public Use C26 – Province of Camarines Sur v. the Solicitor General stated that under Section 9 of the Local Government Code (B. denying the motion to admit the amended motion to dismiss. there was no need for the approval by the Office of the President of the exercise by the Sangguniang Panlalawigan of the right of eminent domain. The Court of Appeals set aside the order of the trial court. the Solicitor General expressed the view that the Province of Camarines Sur must first secure the approval of the Department of Agrarian Reform of the plan to expropriate the lands of petitioners for use as a housing project. allowing the Province of Camarines Sur to take possession of private respondents' lands and the order denying the admission of the amended motion to dismiss. In their petition before the Court of Appeals. The San Joaquins filed a motion for relief from the order. be set aside.good order. However. Instead of building or maintaining a public cemetery for this purpose. 129 authorizing the Provincial Governor to purchase or expropriate property in order to establish a pilot farm for non-food and non-traditional agricultural crops and a housing project for provincial government employees. filed two separate cases for expropriation against private respondents (the San Joaquins). In an order. the trial court denied the motion to dismiss and authorized the Province of Camarines Sur to take possession of the property upon the deposit with the Clerk of Court the amount provisionally fixed by the trial court to answer for damages that private respondents may suffer in the event that the expropriation cases do not prosper. Blg. the city passes the burden to private cemeteries. Corollary to this issue is whether or not the expropriation is for a public use. The ordinance is actually a taking without compensation of a certain area from a private cemetery to benefit paupers who are charges of the municipal corporation. at the Regional Trial Court. Pili. through its Governor. . and thereafter to issue a writ of injunction. 1990. Asked by the Court of Appeals to give his Comment to the petition. The San Joaquins moved to dismiss the complaints on the ground of inadequacy of the price offered for their property. 1990. the San Joaquins asked: (a) that Resolution of the Sangguniang Panlalawigan be declared null and void. 337).P. Both motions were denied in the order dated February 26. 222 SCRA 173 Facts: Sangguniang Panlalawigan (SP) of the Province of Camarines Sur passed a Resolution No. the Province of Camarines Sur. They also asked that an order be issued to restrain the trial court from enforcing the writ of possession. CA. authorizing the Province of Camarines Sur to take possession of their property and a motion to admit an amended motion to dismiss. It also ordered the trial court to suspend the expropriation proceedings until after the Province of Camarines Sur shall have submitted the requisite approval of the Department of Agrarian Reform to convert the classification of the property of the private respondents from agricultural to nonagricultural land. The housing project also satisfies the public purpose requirement of the Constitution. . Once operational. on the other hand. Sec 65 of R. means public advantage. This is limited only to applications for reclassification submitted by land owners or tenant beneficiaries.A. the livelihood of the farmers. In this case. SC explained that there had been a shift from the old to the new concept of “public purpose: Old concept is that the property must actually be used by the general public. The new concept. No. which tends to contribute to the general welfare and the prosperity of the whole community. Rules for determining just compensation are those laid down in Rule 67 ROC. Ruling: 1) The expropriation is for a public purpose. hence the resolution is authorized and valid. 3) Fears of private respondents that they will be paid on the basis of the valuation declared in the tax declarations of their property. (b) orders the trial court to suspend the expropriation proceedings. fishermen and craftsmen would be enhanced. to the control of 3) Whether or not the complaint for expropriation may be dismissed on the ground of inadequacy of the compensation offered. Statutes conferring power of eminent domain to political subdivisions cannot be broadened or constricted by implication. Ultimately. 2) No. the center would make available to the community invaluable information and technology on agriculture. No. Old Local Government Code does not intimate in the least that Local Government Units (LGUs) must first secure approval of the Department of Land Reform for conversion of agriculture to non-agriculture use. the proposed pilot development center would inure to the direct benefit and advantage of the people of the Province of Camarines Sur. the petition is GRANTED and the questioned decision of the Court of Appeals is set aside insofar as it (a) nullifies the trial court's order allowing the Province of Camarines Sur to take possession of private respondents' property. 6657 is not in point because it is applicable only to lands previously placed under the agrarian reform program. are unfounded. 6657) It is unconstitutional to fix just compensation in expropriation cases based on the value given either by the owners or the assessor. SC here said that the implication of the Ardana case is that) the power of expropriation is superior to the power to distribute lands under the land reform program. denying the amended motion to dismiss of the private respondents.A. (citing Ardana vs Reyes. subjecting expropriation by LGUs Department of Agrarian Reform. No. no provision in the Comprehensive Agrarian Reform (R. fishery and the cottage industry. and (c) requires the Province of Camarines Sur to obtain the approval of the Department of Agrarian Reform to convert or reclassify private respondents' property from agricultural to non-agricultural use.A. 6657). convenience or benefit. WHEREFORE. Likewise.2) Whether or not the exercise of the power of eminent domain in this case is restricted by the Comprehensive Agrarian Reform Law (R. The decision of the Court of Appeals is AFFIRMED insofar as it sets aside the order of the trial court. Moreover. evidence must be submitted to justify what they consider is the just compensation. an administrator of the agency. the petitioner cannot argue that the Affidavit of waiver of rights and fees executed by the respondent pertains to the payment of the value of the land therefore exempting NIA to pay the value of the land taken. for and in behalf of 139 members. is the project manager of NIA. No. 141. In this case. Santiago Eslaban Jr. First. Lastly. respondent demands that petitioner pay P111. Such waiver pertains only to the crops and improvements that were damage due to the construction of the right-of-way not the value of the land. 2001 CASE DIGEST: Facts: Clarita Vda.61 per hectare. The parties agreed to the construction of the canal provided that the government will pay for the area that has been taken. Sto. Roxas. 047. 299. prior expropriation proceedings must be filed and just compensation shall be paid to the owner before the land could be taken for public use. just compensation is defined as not only the correct amount to be paid but the reasonable time for the Government to pay the owner. 180.The determination of such value should be from the time of its taking by the NIA in 1981. decision of CA affirmed with modification regarding the just compensation in the amount of P16. Wherefore. Subsequently. 517. Issue: Whether or Not the CA erred in affirming the decision of the RTC. or any government canal where the certificate of title does not state that the boundaries thereof have been pre-determined.ESLABAN V DE ONORIO G. The CA erred in this point by stating that the market value (just compensation) of the land is determined in the filing of the complaint in 1991. way.. After which. A right-of-way agreement was entered into by the parties in which respondent was paid the amount of P4.60 as just compensation for the 24. Mr. South Cotabato. while the verification or certification were signed by Mr. Neither of the two has the authority to sign such certificate for they are not the plaintiff or principal. The following are the points to be considered in arriving in this decision. Rule 7 par 5 of the Rule of Civil Procedure provides that the certification against forum shopping should only be executed by the plaintiff or the principal. represented by its President. private way established by law. 146062 June 28.00 as right of way damages. INC. 1529 provides that the owner is required to recognize in favor of the government the easement of a “public highway. PHILIPPINE PRESS INSTITUTE. Petitioner states that the government had not consented to be sued and that the respondent is not entitled for compensation by virtue of the homestead patent under CA no. Cesar Gonzales. Held: The CA is correct in affirming the decision of the RTC but modifications shall be made regarding the value of the just compensation. In the case at bar. The Court of Appeals also affirmed the decision of the RTC. Second. respondent executed an Affidavit of Waiver of Rights and Fees which waives her rights for the damage to the crops due to construction of the right of way. PD NO. De Onorio is the owner of the land in Barangay M.55 for taking her property but the petitioner refused. The petition for review was filed by Mr. Third. In this case. Nino. the irrigation canal was constructed on Oct 1981 after the property had been registered in May of 1976. Eslaban jr.R. Macasaet and its . Such land is the subject for the construction of an irrigation canal of the National Irrigation Administration (NIA).660 sq meters that have been used for the construction of the canal. The RTC held that the NIA should pay respondent the amount of P107. Amado P. Such case is a sufficient ground for dismissing this petition. L-59603. 2772 is unconstitutional. EPZA VS. in which these lands are registered under. for brevity). hearing was set for the reception of the commissioner’s report. whichever is lower. 2772 does not constitute a valid exercise of the police power of the state. considering that the newspapers were not unwilling to sell advertising space.R. respondent G. 29 Apr 1987] Facts: The four parcels of land which are the subject of this case is where the Mactan Export Processing Zone Authority in Cebu (EPZA) is to be constructed. petitioner vs. Issue: Whether or Not the exclusive and mandatory mode of . In the case at bench. EPZA then filed this petition for certiorari and mandamus enjoining the respondent from further hearing the case. The Comelec space shall also be used by the Commission for dissemination of vital election information. Respondent Judge Dulay then issued an order for the appointment of the commissioners to determine the just compensation. (PPI). the element of necessity for the taking has not been established by respondent Comelec. asks the Supreme Court to declare Comelec Resolution No. G. the Issue: Whether or not Comelec Resolution No. Private respondent San Antonio Development Corporation (San Antonio. free of charge. claimed that the lands were expropriated to the government without them reaching the agreement as to the compensation. impartial and credible election. DULAY [148 SCRA 305. which was objected to by the latter contending that under PD 1533. On behalf of the respondent Comelec. Such objection Held: and the subsequent Motion for Reconsideration were denied and The Supreme Court declared the Resolution as unconstitutional. Jr. a non-profit organization of newspaper and magazine publishers. basis of just compensation shall be fair and according to the fair market value declared by the owner of the property sought to be expropriated. among all candidates to enable them to make known their qualifications. 2772 directing newspapers to provide free Comelec space of not less than one-half page for the common use of political parties and candidates. but not without payment of just compensation. there is no showing of existence of a national emergency to take private property of newspaper or magazine publishers. Petitioner Philippine Press Institute. the Solicitor General claimed that the Resolution is a permissible exercise of the power of supervision (police power) of the Comelec over the information operations of print media enterprises during the election period to safeguard and ensure a fair. No.Executive Director Ermin F.. The taking of private property for public use is authorized by the constitution. their stand on public Issue and their platforms of government. 1995 Facts: Respondent Comelec promulgated Resolution No. Inc. Garcia. It was later found out that the payment of the government to San Antonio would be P15 per square meter. The Comelec space shall be allocated by the Commission.R. Also Resolution No. It held that to compel print media companies to donate “Comelec space” amounts to “taking” of private personal property without payment of the just compensation required in expropriation cases. No. COMMISSION ON ELECTIONS. Moreover. 2772 unconstitutional and void on the ground that it violates the prohibition imposed by the Constitution upon the government against the taking of private property for public use without just compensation. L-119694 May 22. or by the assessor. or executive order can mandate the public purpose because the relocation of squatters involves a that its own determination shall prevail over the court’s findings. It tends to render the courts inutile in a matter in which under the Constitution is reserved to it for financial determination. The determination of just compensation is a judicial function. so they filed a complaint for forfeiture of their rights before the RTC of Quezon City. they already paid a substantial amount to the petitioners. Lastly. They also said that NHA did not relocate squatters from Manila on the expropriated lands which violate the reason for public purpose. The land is located in Dasmarinas. several issues are already raised in the expropriation court. expropriation is for the expansion of the Dasmarinas Resettlement Project to accommodate the squatters who were relocated from Manila. It was affirmed by the Supreme Court. unconstitutional. It held that NHA did not abandon compensation. The petitioners Reyes alleged the failure of the respondents to The method of ascertaining just compensation constitutes impermissible encroachment to judicial prerogatives. The valuation in the comply with the Supreme Court order. no statute. Much less can the courts be precluded from looking into the justness of the decreed compensation.determining just compensation in PD 1533 is unconstitutional. the payment of just compensation is based on the value at the time the property was taken. It also entered into a contract with a developer for the construction of a low-cost housing to be sold to qualified low income beneficiaries. The petitioners prayed that NHA be enjoined from disposing and decree may only serve as guiding principle or one of the factors in alienating the expropriated properties and that judgment be determining just compensation. how to arrive at such amount. The payment of just compensation is independent of the obligation of the petitioners to pay capital gains tax. The purpose of the The Court of Appeals affirmed the decision. The executive department or the legislature may make the initial determination but when a party forfeiting all its rights and interests under the In the answer of NHA. claims a violation of the guarantee in the Bill of Rights that the private party may not be taken for public use without just The trial court dismissed the case. Thus. NHA VS REYES Facts: National Housing Authority filed several expropriation complaints on the sugarland owned by the petitioners Reyes. long and tedious process. but it may not substitute the rendered court’s own judgment as to what amount should be awarded and expropriation judgment. decree. Held: The Supreme Court ruled that the mode of determination of just compensation in PD 1533 is The trial court rendered judgment ordering the expropriation of these lots with payment of just compensation. Cavite. . public use may be abandoned. The expropriation of private property for the purpose of socialized housing for the marginalized sector is in furtherance of the social justice provision under Section 1.Issue: Whether or not the property expropriated is taking for public When land has been acquired for public use in fee simple purpose. Article XIII of the Constitution. The constitutional restraints are public use and just compensation. and “public convenience”. Article III states that private property shall not be taken for public use without just compensation. unconditionally. or any reversion to the former owner. without any impairment of the estate or title The 1987 Constitution explicitly provides for the exercise of the power of eminent domain over the private properties upon payment of just compensation. commercial firms. The act of NHA in entering a contract with a real estate developer for the construction of low cost housing cannot be taken to mean as a deviation from the stated public purpose of their taking. Sec. or the land may be devoted to a different use. “public benefit”. “public welfare”. The “public use” is synonymous with “public interest”. and the Held: The decision appealed is modified. 9. acquired. the former owner retains no rights in the land. Expropriation of private lands for slum clearance and urban development is for a public purpose even if the developed area is later sold to private homeowners. entertainment and service companies and other private concerns. either by the exercise of eminent domain or by purchase. The expropriation judgment declared that NHA has a lawful right to take petitioners properties “for the public use or purpose of expanding the Dasmarinas Resettlement Project”. . wages and fringe benefits (b) 59 million shares of stock distributed for free to the FWBs. .. On May 9. as vehicle to facilitate stock acquisition by the farmworkers. J. July 5.. (HLI) v.117 out of 5315 = shares. as the SDP indicated. Tadeco alleged that Hacienda Luisita does not have tenants. that the 33% shareholdings of the [FWBs] will be maintained at any given time November 21. and the 5. and whenever conditions should exist warranting such action under the provisions of the Land Tenure Act.117 FWBs.. Group. The production-sharing. That over the implementation period of the [SDP]. 171101. [Tadeco]/HLI shall ensure that there will be no dilution in the shares of stocks of individual [FWBs]. As may be gleaned from the SDOA. JR. out of 5. Responding.911 million loan in favor of Tadeco to pay the peso price component of the sale.: THE FACTS In 1958. For this purpose. 2.000. the Spanish owners of Compañia General de Tabacos de Filipinas (Tabacalera) sold Hacienda Luisita and the Central Azucarera de Tarlac. along the following lines: 1. 89-12-2. for them to surrender Hacienda Luisita to the then Ministry of Agrarian Reform (MAR) so that the land can be distributed to farmers at cost. during the administration of President Corazon Cojuangco Aquino. some 93% of the then farmworker-beneficiaries (FWBs) complement of Hacienda Luisita signified in a referendum their acceptance of the proposed HLI’s Stock Distribution Option Plan (SODP).000. HLI claimed to have extended the following benefits to the FWBs: (a) 3 billion pesos (P3. On May 7. That a safeguard shall be provided by [Tadeco]/HLI against the dilution of the percentage shareholdings of the [FWBs]. Tadeco conveyed to HLI the agricultural land portion (4.000) worth of salaries. et al. i.75 hectares) and other farm-related properties of Hacienda Luisita in exchange for HLI shares of stock. The CA dismissed the case. (d) 37. to the Tarlac Development Corporation (Tadeco). Tadeco appealed to the CA. The SDOA embodied the basis and mechanics of HLI’s SDP. This attested to by then DAR Secretary Philip Juico. then owned and controlled by the Jose Cojuangco Sr.] On August 23. 1989 . is payable "irrespective of whether [HLI] makes money or not. Tadeco organized a spin-off corporation. approving the SDP of Tadeco/HLI.848 qualified FWBs. (e) 240-square meter homelots distributed for free.. The Central Bank of the Philippines assisted Tadeco in obtaining a dollar loan from a US bank. included as part of the distribution plan are: (a) production-sharing equivalent to three percent (3%) of gross sales from the production of the agricultural land payable to the FWBs in cash dividends or incentive bonus. G. No. in which 5. Defensor-Santiago. the SDOA was formally entered into by Tadeco. the sugar mill of the hacienda.R. Also. Presidential Agrarian Reform Council (PARC). [Under EO 229 (Sec10) and later RA 6657(Sec31). should there be any. 1989. et al. issued Resolution No. 1980. subject to the PARC’s approval of Tadeco’s proposed stock distribution plan (SDP) in favor of its farmworkers. 1989.” Tadeco however did not comply with this condition. 1989. besides which sugar lands – of which the hacienda consisted – are not covered by existing agrarian reform legislations(PD 27-rice and corn). et al. (c) 150 million pesos (P150. The Manila RTC rendered judgment ordering Tadeco to surrender Hacienda Luisita to the MAR. opted to receive shares in HLI. under then Sec. 1988. and (b) distribution of free homelots of not more than 240 square meters each to family-beneficiaries. the GSIS extended a PhP5. (5. which was eventually approved by the PARC after a follow-up referendum conducted by the DAR on October 14.315 who participated. On March 17. the martial law administration filed a suit before the Manila RTC against Tadeco. On May 11. 1988.500. VELASCO. Tadeco had the option of availing stock distribution as an alternative modality to actual land transfer to the farmworkers.000) representing 3% from the sale of 500 hectares of converted agricultural land of Hacienda Luisita.000) representing 3% of the gross produce.915. From 1989 to 2005.5 million pesos (P37. as the term is ordinarily understood under corporation law. HLI. 2011 DECISION I.Hacienda Luisita Inc.000. Therefrom. herein petitioner HLI.e. DAR Secretary Miriam Defensor-Santiago proposed that the SDP be revised. with the condition that “the lots comprising the Hacienda Luisita be subdivided by the applicantcorporation and sold at cost to the tenants. 132 = land distribution) Prior to approval. the Office of the Solicitor General moved to withdraw the government’s case against Tadeco.the PARC." implying that the benefits do not partake the nature of dividends. Centennary sold the entire 300 hectares for PhP750 million to Luisita Industrial Park Corporation (LIPCO).695. 4. praying for the revocation and nullification of the SDOA and the distribution of the lands in the hacienda. It is the court which has jurisdiction and authority to order the revocation or rescission of the PARC-approved SDP (1) YES.335. in the alternative. PARC would eventually deny HLI’s motion for reconsideration via Resolution No.51 hectares were later detached from Hacienda Luisita and acquired by the government as part of the Subic-Clark-Tarlac Expressway (SCTEX) complex. recalling/revoking the SDO plan of Tadeco/HLI. among other conditions. HLI. 2006-3401 dated May 3.732. Subsequently. the authority to approve the plan for stock distribution of the corporate landowner belongs to PARC. The DAR then constituted a Special Task Force (STF) to attend to issues relating to the SDP of HLI. Inc.400. From this area was carved out 2 parcels(180 has and 4 has). 1995. It further resolved that the subject lands be forthwith placed under the compulsory coverage or mandated land acquisition scheme of the CARP. (g) Social service benefits. The first was filed by the Supervisory Group of HLI (Supervisory Group).915 hectares Tadeco ceded to HLI. praying for a renegotiation of the SDOA.000) representing 3% from the sale of 80 hectares at 80 million pesos (P80. Later.(f) 2. Under Sec. HLI also filed a petition before the Supreme Court in light of what it considers as the DAR’s hasty placing of Hacienda Luisita under CARP even before PARC could rule or even read the motion for reconsideration. LIPCO’s titles were cancelled and new ones were issued to RCBC.000.000 shares of stocks of Centennary Holdings. Two separate groups subsequently contested this claim of HLI. 2005-32-01. the STF found that HLI has not complied with its obligations under RA 6657 despite the implementation of the SDP. which allows stock transfer in lieu of outright land transfer. was filed by Alyansa ng mga Manggagawang Bukid ng Hacienda Luisita (AMBALA). but not to recall its previous approval of the SDP. 2005. THE RULING HLI: PARC has no authority to revoke the SDP. the PARC has jurisdiction to revoke HLI’s SDP under the doctrine of necessary implication. as urged. (Centennary). it has the power to disapprove. Contrary to petitioner HLI’s posture. its revocation. for which 2 separate titles were issued in the name of LIPCO. in exchange for subscription of 12. After investigation and evaluation. On December 13.000. that RA 6657 or other executive . II. From the foregoing resolution. such as but not limited to free hospitalization/medical/maternity services. Such. The DAR approved the application on August 14.4 million pesos (P2. THE ISSUES (1) Does the PARC possess jurisdiction to recall or revoke HLI’s SDP? (2) [Issue raised by intervenor FARM (group of farmworkers)] Is Sec. 65 of RA 6657. Its motion notwithstanding. It may be. LIPCO transferred these 2 parcels to the Rizal Commercial Banking Corporation (RCBC) in payment of LIPCO’s PhP431. which used it in developing an industrial complex. was the state of things when two separate petitions reached the DAR in the latter part of 2003. 1996.75 hectares remained of the original 4. 2006. or. ceded 300 hectares of the converted area to the latter. another 80. PARC also has the power to revoke the SDP which it previously approved. On December 22. 31 of RA 6657. as implemented by DAO 10.000) for the SCTEX. pursuant to Sec. Thus. unconstitutional? (3) Is the revocation of the HLI’s SDP valid? [Did PARC gravely abuse its discretion in revoking the subject SDP and placing the hacienda under CARP’s compulsory acquisition and distribution scheme?] (4) Should those portions of the converted land within Hacienda Luisita that RCBC and LIPCO acquired by purchase be excluded from the coverage of the assailed PARC resolution? [Did the PARC gravely abuse its discretion when it included LIPCO’s and RCBC’s respective properties that once formed part of Hacienda Luisita under the CARP compulsory acquisition scheme via the assailed Notice of Coverage?] III. subject to payment of three percent (3%) of the gross selling price to the FWBs and to HLI’s continued compliance with its undertakings under the SDP. The other 200 has was transferred to Luisita Realty Corporation (LRC) in two separate transactions in 1997 and 1998. HLI sought reconsideration. the PARC issued the assailed Resolution No. Apart from the 500 hectares. AND RECOMMENDED. both uniformly involving 100 hectares for PhP 250 million each. 31 of RA 6657. HLI applied for the conversion of 500 hectares of land of the hacienda from agricultural to industrial use. The second petition. (the petitions/protets) CONVERSION PROPER On August 15.10 loan obligations to RCBC(dacion en pago). old age/death benefits and no interest bearing salary/educational loans and rice sugar accounts. 1996. is the alleged non-compliance by HLI with the conditions of the SDP to support a plea for its revocation. looking deeply into the underlying petitions of AMBALA. obligations and remedies of the parties to the SDOA embodying the SDP are primarily governed by RA 6657. 31 of RA 6657 is not unconstitutional. The last but the most important requisite that the constitutional issue must be the very lis mota of the case does not likewise obtain. 2003 or 14 years after approval of the SDP that said plan and approving resolution were sought to be revoked. obligations and remedies. and why its members received benefits from the SDP without so much of a protest. [The Court actually refused to pass upon the constitutional question because it was not raised at the earliest opportunity and because the resolution thereof is not the lis mota of the case. Moreover. HLI: the parties to the SDOA should now look to the Corporation Code. 31 of RA 6657 vis-à-vis the stock distribution component of said Sec. the issue has been rendered moot and academic since SDO is no longer one of the modes of acquisition under RA 9700. but not. by FARM or any of its members. however. Furthermore. in determining their rights. 31 of RA 6657 as early as November 21. whose 27 members formerly belonged to AMBALA. It was only on December 4. 31 of RA 6657. composed of a small minority of 27 farmers. any of these key issues may be resolved without plunging into the constitutionality of Sec. but concentrated on the purported flaws and gaps in the subsequent implementation of the SDP. it is not the said section per se that is invalid. If some other grounds exist by which judgment can be made without touching the constitutionality of a law. as couched and implemented. The FARM members slept on their rights and even accepted benefits from the SDP with nary a complaint on the alleged unconstitutionality of Sec. et al. Following the doctrine of necessary implication. thus. On the other hand. proceeding from the basic positions originally taken by AMBALA (to which the FARM members previously belonged) and the Supervisory Group. 5 of RA 9700. offends certain constitutional and statutory provisions. did not question the constitutionality of the provision. The lis mota in this case.issuances on agrarian reform do not explicitly vest the PARC with the power to revoke/recall an approved SDP. The lis mota aspect is not present. 2007 when it filed its Supplemental Comment with the Court. . It should abundantly be made clear that HLI was precisely created in order to comply with RA 6657. The Code should be the applicable law on the disposition of the agricultural land of HLI.] While there is indeed an actual case or controversy. 31 only on May 3. Thus. it took FARM some eighteen (18) years from November 21. intervenor FARM. FARM. the lis mota is whether or not PARC acted in grave abuse of discretion when it ordered the recall of the SDP for such non-compliance and the fact that the SDP. paradoxical for HLI to shield itself from the coverage of CARP by invoking exclusive applicability of the Corporation Code under the guise of being a corporate entity. 1989 when PARC approved the SDP of Hacienda Luisita or at least within a reasonable time thereafter. Such power or authority. such recourse is favored. Moreover. as represented by the Solicitor General. but by petitioner AMBALA. Even the public respondents. instead of to RA 6657. 31 upon which the benefits were derived. 1989 before it challenged the constitutionality of Sec. It is. raised the constitutionality of Sec. To deny PARC such revocatory power would reduce it into a toothless agency of CARP. (2) NO. 31 of RA 6657. which the OSG aptly described as the "mother law" of the SDOA and the SDP. And before the Court. Sec. because the very same agency tasked to ensure compliance by the corporate landowner with the approved SDP would be without authority to impose sanctions for non-compliance with it. has yet to explain its failure to challenge the constitutionality of Sec. It may be well to note at this juncture that Sec. SC: NO! the rights. has all but superseded Sec. To be sure. but rather it is the alleged application of the said provision in the SDP that is flawed. to stress. a basic postulate that what is implied in a statute is as much a part of it as that which is expressed. amending Sec. 31 of RA 6657 which is quite too late in the day. 7 of RA 6657. is deemed possessed by PARC under the principle of necessary implication. it may be stated that the conferment of express power to approve a plan for stock distribution of the agricultural land of corporate owners necessarily includes the power to revoke or recall the approval of the plan.. the constitutional issue tendered not being critical to the resolution of the case. the AMBALA petition did NOT question the constitutionality of Sec. The Court cannot now be goaded into resolving a constitutional issue that FARM failed to assail after the lapse of a long period of time and the occurrence of numerous events and activities which resulted from the application of an alleged unconstitutional legal provision. 2010 submitted by HLI to the Court. the transfer of the shares of stock in the names of the qualified FWBs should be recorded in the stock and transfer books and must be submitted to the SEC within sixty (60) days from implementation. The question of whether or not it is unconstitutional should be a moot issue. As determined earlier.976. substantive or procedural. If it falls below 37 days. 11 of DAO 10 prescribes. the SECOND PARTY [HLI] shall arrange with the FIRST PARTY [TDC] the acquisition and distribution to the THIRD PARTY [FWBs] on the basis of number of days worked and at no cost to them of one-thirtieth (1/30) of 118.296 FWBs.” Thus. 5 of RA 9700 provides: “[T]hat after June 30. (2) the 30-year timeframe for HLI-to-FWBs stock transfer is contrary to what Sec.296% of the total outstanding capital stock of HLI. 2009. Going into another but related matter. correct in revoking the SDP. In fact. HLI hired farmworkers in addition to the original 6. which is at once discernible as it is practical. a beneficiary needs to work for at least 37 days in a fiscal year before he or she becomes entitled to HLI shares.32 shares was diluted as a result of the use of “man days” and the hiring of additional farmworkers. All these farmworkers.32 HLI shares per beneficiary. such that.391. because the acquisition and distribution of the HLI shares were based on “man days” or “number of days worked” by the FWB in a year’s time.976. Taking into account the above discussion. (4) YES. there is a purpose. The original FWBs got less than the guaranteed 18. the revocation of the HLI’s SDP valid. 11 of DAO 10 prescribes. the total number of farmworkers of HLI as of said date stood at 10.296 FWBs. Being a product of such rule-making power. the PARC did NOT gravely abuse its discretion in revoking the subject SDP and placing the hacienda under CARP’s compulsory acquisition and distribution scheme. for a period of 30 years. as indicated in the Compliance dated August 2. The number of HLI shares distributed varies depending on the number of days the FWBs were allowed to work in one year. 31 of RA 6657 is no longer an available option under existing law. DAO 10 has the force and effect of law and must be duly complied with. the PARC and the DAR have the power to issue rules and regulations. based on the said provision. To the Court. were given shares out of the 118. Par. The PARC is. 3 of the SDOA expressly providing for a 30-year timeframe for HLI-to-FWBs stock transfer is an arrangement contrary to what Sec. In its pertinent part. l989 approving the HLI’s SDP is nullified and voided. the stock distribution scheme under Sec. Remove this timeline and the corporate landowner can veritably evade compliance with agrarian reform by simply deferring to absurd limits the implementation of the stock distribution scheme.31.] The revocation of the approval of the SDP is valid: (1) the mechanics and timelines of HLI’s stock distribution violate DAO 10 because the minimum individual allocation of each original FWB of 18. par. until such time as the entire block of 118.32 HLI shares. We find that it violates two (2) provisions of DAO 10. suffered from watering down of shares. the modes of acquisition shall be limited to voluntary offer to sell and compulsory acquisition. Worse. for the three-month threshold. [I]t is clear as day that the original 6. the PARC Resolution No.976. the revocation of the SDP by PARC should be upheld [because of violations of] DAO 10. which include the original 6. 11 provides for the implementation of the approved stock distribution plan within three (3) months from receipt by the corporate landowner of the approval of the plan by PARC. 89-12-2 dated November 21.931. At the end of each fiscal year.804. As explained by HLI. who were qualified beneficiaries at the time of the approval of the SDP.804. those portions of the converted land within Hacienda Luisita that RCBC and LIPCO acquired by purchase . 3 of the SDOA states: 3. Clearly. unfortunately. each original FWB is entitled to 18. In our review and analysis of par. It bears stressing that under Sec.502.804. the FWB.804.85 HLI shares representing the 33. as the shares may be issued in a much shorter period of time. Sec. 49 of RA 6657.391. therefore. (3) YES.32 shares was diluted as a result of the use of “man days” and the hiring of additional farmworkers. [NO. Said Sec. the reason underpinning the 30-year accommodation does not apply to corporate landowners in distributing shares of stock to the qualified beneficiaries. 3 of the SDOA on the mechanics and timelines of stock distribution. for all intents and purposes. does not get any share at year end. Consequently.85 shares shall have been completely acquired and distributed to the THIRD PARTY.85 shares of the capital stock of the SECOND PARTY that are presently owned and held by the FIRST PARTY.296 FWBs. the minimum individual allocation of each original FWB of 18. RCBC and LIPCO purchased the lots in question on their honest and wellfounded belief that the previous registered owners could legally sell and convey the lots though these were previously subject of CARP coverage. Pertinently. can be legally and validly acquired by them. DAR. and consequently DAR. gravely abused its discretion when it placed LIPCO’s and RCBC’s property which once formed part of Hacienda Luisita under the CARP compulsory acquisition scheme via the assailed Notice of Coverage.” Moreover. commercial or industrial purposes. the past cannot always be erased by a new judicial declaration. In relying upon the above-mentioned approvals. 2004.should be excluded from the coverage of the assailed PARC resolution.10.695. after going through the necessary processes. as the DAR conversion order was annotated at the back of the titles of the lots they acquired. they are of the honest belief that the subject lots were validly converted to commercial or industrial purposes and for which said lots were taken out of the CARP coverage subject of PARC Resolution No. at the time LIPCO acquired said parcels of land. Centennary. 50 of RA 6657 to determine and adjudicate agrarian reform matters and its original exclusive jurisdiction over all matters involving the implementation of agrarian reform. However. . the Secretary’s Certificate in favor of Koji Komai and Kyosuke Hori. The PARC. namely: (1) that the purchaser buys the property of another without notice that some other person has a right to or interest in such property. 1998. the Secretary’s Certificate in favor of Shintaro Murai. granted the conversion of 500 hectares of Hacienda Luisita pursuant to its primary jurisdiction under Sec. To be sure. and the conversion of the property from agricultural to industrial and residential use.732. and gave them the opportunity to comment or oppose the proposed conversion. and the Real Estate Mortgage in favor of RCBC to guarantee the payment of PhP 300 million. in declaring a law or executive action null and void. The same is true with respect to RCBC. both LIPCO and RCBC purchased portions of Hacienda Luisita for value. It can rightfully be said that both LIPCO and RCBC are purchasers in good faith for value entitled to the benefits arising from such status. RCBC and LIPCO acted in good faith in acquiring the subject lots. 65 of RA 6657 explicitly allows conversion and disposition of agricultural lands previously covered by CARP land acquisition “after the lapse of five (5) years from its award when the land ceases to be economically feasible and sound for agricultural purposes or the locality has become urbanized and the land will have a greater economic value for residential. On the other hand. only the following general annotations appeared on the TCTs of LIPCO: the Deed of Restrictions. proclamation and conversion order. undue harshness and resulting unfairness must be avoided. 2005-32-01 and 2006-34-01. After all. limiting its use solely as an industrial estate. And second. The actual existence of a statute or executive act is. In this factual setting. prior to such a determination. and (2) that the purchaser pays a full and fair price for the property at the time of such purchase or before he or she has notice of the claim of another. both RCBC and LIPCO cannot be considered at fault for believing that certain portions of Hacienda Luisita are industrial/commercial lands and are. 8912-2 and. [T]here are two (2) requirements before one may be considered a purchaser in good faith. First. or. or that any other person has a right to or interest in such property. no longer without force and effect. Undeniably. an operative fact and may have consequences which cannot justly be ignored. at the time LIPCO purchased the entire three hundred (300) hectares of industrial land. intervenor RCBC and LIPCO knew that the lots they bought were subjected to CARP coverage by means of a stock distribution plan. Sec. thus. LIPCO conveyed portions of Hacienda Luisita in favor of RCBC by way of dacion en pago to pay for a loan of PhP431. At the time it acquired portions of Hacienda Luisita. hence. by extension. outside the ambit of CARP. since rights might have accrued in favor of natural or juridical persons and obligations justly incurred in the meantime. DAR notified all the affected parties. LIPCO acquired 300 hectares of land from Centennary for the amount of PhP750 million pursuant to a Deed of Sale dated July 30. This is as it should realistically be. Ergo. in a Deed of Absolute Assignment dated November 25. more particularly the FWBs. there was no notice of any supposed defect in the title of its transferor. In fact. the “operative fact” doctrine realizes that. the Court cannot close its eyes to certain “operative facts” that had occurred in the interim. only the following annotations appeared on the TCT in the name of Centennary: the Secretary’s Certificate in favor of Teresita Lopa. The DAR conversion order became final and executory after none of the FWBs interposed an appeal to the CA. [The Court went on to apply the operative fact doctrine to determine what should be done in the aftermath of its disposition of the above-enumerated issues: While We affirm the revocation of the SDP on Hacienda Luisita subject of PARC Resolution Nos. He argued that that the operative fact doctrine only applies in considering the effects of a declaration of unconstitutionality of a statute or a rule issued by the Executive Department that is accorded the status of a statute. who can validly dispose of their due shares. 93% of the FWBs agreed to the SDOA (or the MOA). The provision grants to corporate landowners the option to give qualified FWBs the right to own capital stock of the corporation in lieu of actual land distribution. the qualified FWBs.391. and 3% of the proceeds of the sale of the 500-hectare converted land and the 80. Article XIII of the Constitution. 3% of the gross produce from agricultural lands. when the SDOA was executed by Tadeco. when the SDOA was executed by Tadeco. He also held that the time of the taking (when the computation of just compensation shall be reckoned) shall be May 11. Under Sec. in favor of LBP or other qualified beneficiaries. give first the original qualified FWBs the option to either remain as stockholders of HLI or choose actual land distribution) and the applicability of the operative fact doctrine. which. He however agreed with the majority that the FWBs be given the option to remain as shareholders of HLI. were to be awarded and distributed. He argued that the nullity of HLI’s SDP/SDOA goes into its very existence. he averred that considering that more than 10 years have elapsed from May 11. The Court cannot turn a blind eye to the fact that in 1989. if not all.51hectare lot sold to SCTEX. HLI and the FWBs. requires that the law implementing the agrarian reform program should employ [actual] land redistribution mechanism. by application of the operative fact principle. 20l0. of the FWBs may actually desire to continue as HLI shareholders. 31 of RA 6657 contravenes Sec. 1989. He concluded that since an unconstitutional provision cannot be the basis of a constitutional act. is therefore in order. 1989. the point in time when the compulsory CARP coverage should start. and the parties to it must generally revert to their respective situations prior to its execution. the FWBs were said to have received from HLI salaries and cash benefits.976. not [of] the lands they till.. it is deemed void ab initio. Justice Mendoza fully concurred with Chief Justice Corona’s position that Sec. and proceeding to adjust the relations of the parties with due regard to the events that intervened [thereafter]. A matter best left to their own discretion. Qualified beneficiaries are given ownership only of shares of stock. and not land. The 10-year period need not be counted from the issuance of the Emancipation Title (EP) or Certificate of Land Ownership Award CLOA) because. the revocation must. 31 of RA 6657. It produces no legal effects whatsoever. Justice Brion questioned the option given by the majority to the FWBs to remain as stockholders in an almost-bankrupt corporation like HLI. the SDP of petitioner HLI based on Section 31 of RA 6657 is also unconstitutional. 31 of RA 6657 unconstitutional. not land. Thus. 4. On August 6. and as a matter of fact. most FWBs indicated their choice of remaining as stockholders. 2011 decision The dissents of the minority justices were on the other fine points of the decision. Restitution. The SDOA/SDP is neither a statute nor an executive issuance but a contract between the FWBs and the landowners. 2005. may do so. Justice Sereno dissented with respect to how the majority modified the questioned PARC Resolutions (i. Erroneous interpretation of the Court’s decision . She would instead order the DAR to forthwith determine the area of Hacienda Luisita that must be covered by the compulsory coverage and monitor the land distribution to the qualified FWBs.] The dissents in the July 5. 8912-2 dated November 21.e. as “compliance” with agrarian reform.85 were distributed as of April 22. 1989. He also joined Justice Brion’s proposal that that the reckoning date for purposes of just compensation should be May 11. shares. HLI and the FWBs. under the SDOA. the operative fact doctrine is not applicable. hospital and medical benefits. in which HLI gave the FWBs the option of acquiring a piece of agricultural land or remain as HLI stockholders. 240-square meter homelots. Finally. the corporate landowner remains to be the owner of the agricultural land. 31 of RA 6657 is unconstitutional. HLI shares totaling 118. 1989. HLI and private respondents submitted a Compromise Agreement. the FWBs should return everything they are proven to have received pursuant to the terms of the SDOA/SDP. The Chief Justice was of the view that by allowing the distribution of capital stock.296 qualified FWBs to choose whether they want to remain as HLI stockholders or not. give way to the right of the original 6. he noted. A contract stands on a different plane than a statute or an executive issuance.While the assailed PARC resolutions effectively nullifying the Hacienda Luisita SDP are upheld. With the SDP being void.] 1989. he said. no immediate land distribution. When a contract is contrary to law. Sec. Justice Brion then proposed that all aspects of the implementation of the mandatory CARP coverage be determined by the DAR by starting with a clean slate from [May 11. Justice Brion’s dissent centered on the consequences of the revocation of HLI’s SDP/SDOA. Chief Justice Corona dissented insofar as the majority refused to declare Sec. he argued. which became the basis of the SDP approved by PARC per its Resolution No. hence. From 1989 to 2005. These facts and circumstances tend to indicate that some. 2011 (1) Motion for Clarification and Partial Reconsideration dated July 21. (2) (3) - (4) (5) (6) 2006. 2011 filed by private respondents Rene Galang and ISSUES: (1) applicability of the operative fact doctrine. It should not apply if it would result to inequity CA erred in holding that improving the economic status of FWBs is not among the legal obligations of HLI under the SDP and an imperative imposition by RA 6657 and DAO 10 CA erred in holding that LIPCO and RCBC were purchasers for value Motion for Reconsideration dated July 21. he called upon everyone to just “wait for the final resolution of the motion[s]. 2011) and Conchita Carpio-Morales (June 19. In a press conference called after the promulgation of the Court’s decision.the actual taking is NOT November 21. The 14th and 15th seats in the Court were earlier vacated by the retirements of Justices Eduardo Antonio Nachura (June 13. (HLI). 2011). (3) coverage of compulsory acquisition. Another misinterpretation came from no less than the Supreme Court administrator and spokesperson. Bersamin. No. But since by then the parties had already filed their respective motions for reconsideration. Leonardo-De Castro. (Supervisory Group) and Windsor Andaya (collectively referred to as "Mallari. This is contrary to media reports that the Court “voted 6-4” to dismiss the HLI petition. the date when the Notice of Coverage was issued by the DAR Motion for Partial Reconsideration dated July 20.R. the reckoning period may be tacked to January 2. and Sereno) only partially dissented from the decision of the majority of six (Justice Velasco Jr. Midas Marquez. 2011 filed by PARC and DAR Doctrine of Operative fact does not apply because no law was declared void. 2011 filed by petitioner Hacienda Luisita. 1989. Atty. Julio Suniga. G. (5) sale to third parties. Supervisory Group of Hacienda Luisita."). Motion for Reconsideration dated July 19. the option given to the farmers to remain as stockholders of HLI is equivalent to an option for HLI to retain land in direct violation of the CARL. Marquez initially used the term “referendum” in explaining the High Court’s ruling. or at the very least. This created confusion among the parties and the interested public since a “referendum” implies that the FWBs will have to vote on a common mode by which to pursue their claims over Hacienda Luisita. Justice Antonio Carpio took no part in the deliberations and in the voting. which is forthcoming anyway.” The resolution of the consolidated motions for reconsideration came relatively early on November 22. and Motion for Reconsideration dated July 22. 171101 November 22. et al. and (7) control over agricultural lands (revocation of SDP) OPERATIVE FACT DOCTRINE (not much related) . Villarama. but should be reckoned from finality of the Decision of this Court. and Perez). 2011 filed by respondent-intervenor Farmworkers Agrarian Reform Movement. (4) just compensation. while Justice Diosdado Peralta was on official leave. The decision was thus met with cries of condemnation by the misinformed farmers and the various people’s organizations and militant groups supportive of their cause.The High Tribunal actually voted unanimously (11-0) to DISMISS/DENY the petition of HLI and to AFFIRM the PARC resolutions. 2011. 2011 filed by AMBALA RA 6657 is unconstitutional "operative fact doctrine" does not apply. Marquez would later correct himself in a subsequent press briefing. Del Castillo. (2) constitutionality of Sec. and the distribution would be considered dissolution of HLI . 2011 filed by private respondents Noel Mallari. Mendoza. The five (not four) minority justices (Chief Justice Corona. or less than five months from the promulgation of the decision. Inc. . (FARM). Abad. Inc. and Justices Brion.. (6) the violations of HLI. 31 of RA 6657 or the Comprehensive Agrarian Reform Law of 1988. Inc. same with AMBALA issue of constitutionality is the lis mota of the case which must be decided upon Motion for Reconsideration dated July 21. the SDP having been revoked.it is not proper to distribute the proceeds of the conversion sale to the FWBs the proceeds of the sale belong to the corporation for having sold its asset. 75 has. In order to ensure the proper distribution of the agricultural lands of Hacienda Luisita per qualified FWB. contends that the declaration of the area to be awarded to each FWB is too restrictive. The application of the doctrine is favorable to the FWBs because not only were the FWBs allowed to retain the benefits and homelots they received under the stock distribution scheme.915. AMBALA alleged that HLI should no longer be paid just compensation for the agricultural land that will be distributed to the FWBs. and other portions of the land that are considered commonly-owned by farmworkers. 1989. 1989. It stresses that in agricultural landholdings like Hacienda Luisita. By applying the doctrine. the proceeds from the sale shall take the place of the lots. should have been included in the compulsory coverage were it not for their conversion and valid transfers. however. which is the agricultural land allegedly covered by RA 6657 and previously held by Tarlac Development Corporation (Tadeco). 89-12-2 and ruled for the compulsory coverage of the agricultural lands of Hacienda Luisita in view of HLI’s violation of the SDP and DAO 10. this Court merely gave the qualified FWBs the option to remain as stockholders of HLI and ruled that they will retain the homelots and other benefits which they received from HLI by virtue of the SDP. et al. 89-12-2 and. 2011 Decision does not give it any leeway in adjusting the area that may be awarded per FWB in case the number of actual qualified FWBs decreases. We stated that "HLI shall be paid just compensation for the remaining agricultural land that will be transferred to DAR for land distribution to the FWBs. 2011 Decision. The second requirement that the constitutional question should be raised at the earliest possible opportunity is clearly wanting. 89-12-2. CONSTITUTIONALITY (Upheld previous ruling) FARM is. whereas the area that should. as well as the 80. of agricultural land and not 6.915. the operative fact doctrine is clearly applicable. at the least. In effect. The last but the most important requisite that the constitutional issue must be the very lis mota of the case does not likewise obtain. remiss in belatedly questioning the constitutionality of Sec. 89-12-2 ––an executive act––was declared invalid in the instant case. 2011 Decision.Bearing in mind that PARC Resolution No. COVERAGE OF COMPULSORY ACQUISITION FARM argues that this Court ignored certain material facts when it limited the maximum area to be covered to 4. JUST COMPENSATION .443 hectares. which only involves 4. 31 of RA 6657.915.75 hectares. argued that the valuation of the land cannot be based on November 21.51-hectare SCTEX lot. they are of the honest belief that the subject lots were validly converted to commercial or industrial purposes and for which said lots were taken out of the CARP coverage subject of PARC Resolution No. PROCEEDS OF SALE Considering that the 500-hectare converted land. it is the latter which shall determine the area with which each qualified FWB will be awarded. However. they aver that the date of "taking" for valuation purposes is a factual issue best left to the determination of the trial courts. Instead." We also ruled that the date of the "taking" is November 21. and this may necessarily result in the decrease of the area size that may be awarded per FWB.75 has. be covered is 6.“TAKING” In Our July 5. as the DAR conversion order was annotated at the back of the titles of the lots they acquired. since the RTC already rendered a decision ordering "the . hence.. of agricultural land. DAR also argues that the July 5. then it is only but proper that the price received for the sale of these lots should be given to the qualified FWBs. irrigation canals. they were also given the option to choose for themselves whether they want to remain as stockholders of HLI or not.443 has. We cannot subscribe to this view. Mallari. the constitutional issue tendered not being critical to the resolution of the case. The argument is meritorious. therefore. The lis mota aspect is not present. Since what is put in issue before the Court is the propriety of the revocation of the SDP. can be legally and validly acquired by them. DAR. there are roads. it should be recognized that SC. when PARC approved HLI’s SDP per PARC Resolution No. affirmed the revocation of Resolution No. 500 HECTARES RCBC and LIPCO knew that the lots they bought were subjected to CARP coverage by means of a stock distribution plan. in its July 5. then We are constrained to rule only as regards the 4. and considering that matters involving strictly the administrative implementation and enforcement of agrarian reform laws are within the jurisdiction of the DAR. " One last point.R. then the 10-year period prohibition on the transfer of awarded lands under RA 6657 lapsed on May 10. that is. regardless of whether they have fully paid for the lands or not. the right to the land may be transferred or conveyed. In the event of such transfer to the LBP. in view of the operative fact doctrine. 1989. all the benefits and homelots80 received by all the FWBs shall be respected with no obligation to refund or return them. 1989. these lands became subject of the agrarian reform coverage through the stock distribution scheme only upon the approval of the SDP. which will distribute the land to small farmers after compensating the landowners P3. together with the value of improvements he has made on the land. if We maintain the position that the qualified FWBs should be immediately allowed the option to sell or convey the agricultural lands in Hacienda Luisita. as a condition for such transfer or conveyance. G. shall cultivate the land himself. Considering that the EPs or CLOAs have not yet been issued to the qualified FWBs in the instant case. If the land has not yet been fully paid by the beneficiary. to any heir of the beneficiary or to any other beneficiary who. since. the awarded lands may only be transferred or conveyed after ten (10) years from the issuance and registration of the emancipation patent (EP) or certificate of land ownership award (CLOA).000) per hectare. with prior approval of the DAR. consequently. "the benefits x x x were received by the FWBs as farmhands in the agricultural enterprise of HLI and other fringe benefits were granted to them pursuant to the existing collective bargaining agreement with Tadeco. these lands will just be transferred to persons not entitled to land distribution under CARP. November 21. CONTROL OVER AGRICULTURAL LANDS SC realized that the FWBs will never have control over these agricultural lands for as long as they remain as stockholders of HLI. Further. PARC/DAR’s. and not the placing of the agricultural lands under CARP coverage. AMBALA contended that it should be pegged at forty thousand pesos (PhP 40. including HLI. such approval is akin to a notice of coverage ordinarily issued under compulsory acquisition.296 original FWBs. any doubt should be resolved in favor of the FWBs. SC: the date of "taking" is November 21. Thus. the 10-year prohibitive period has not even started. however. AMBALA’s. With these." In the event. the date when PARC approved HLI’s SDP in view of the fact that this is the time that the FWBs were considered to own and possess the agricultural lands in Hacienda Luisita. HLI will no longer be operating under SDP and will only be treated as an ordinary private corporation. Without a doubt. the latter shall compensate the beneficiary in one lump sum for the amounts the latter has already paid. 1999. 22 of RA 6657. 2012 .206 FWBs are not entitled to any portion of the HLI land. bearing in mind that with the revocation of the approval of the SDP. the reckoning point is the issuance of the EP or CLOA.Cojuangcos to transfer the control of Hacienda Luisita to the Ministry of Agrarian Reform. SALE TO THIRD PARTIES There is a view that since the agricultural lands in Hacienda Luisita were placed under CARP coverage through the SDOA scheme on May 11. The remaining 4. since this was the same value that Tadeco declared in 1989 to make sure that the farmers will not own the majority of its stocks. under RA 6657 and DAO 1. 1989.296 original FWBs pursuant to Sec. as We have mentioned in our July 5. since. the HLI land shall be distributed only to the 6. No.988 million. at the end of the day. the qualified FWBs should already be allowed to sell these lands with respect to their land interests to third parties. 2011 Decision. and. 171101 April 24. The proposition is erroneous. In addition to the foregoing. The order giving option to the FWBs to choose whether or not to stay as shareholders was thereby recalled. To be precise. Significantly. the FWBs who remain as stockholders of HLI will be treated as ordinary stockholders and will no longer be under the protective mantle of RA 6657. Failing compliance herewith. because the rights to said land were vested only in the 6. the land shall be transferred to the LBP which shall give due notice of the availability of the land in the manner specified in the immediately preceding paragraph. that this Court will rule that HLI is indeed entitled to compensation. then all efforts at agrarian reform would be rendered nugatory by this Court. and FARM’s Motions – GRANTED. Ownership by one cannot be considered as ownership by the other.75 hectares covered by the SDP. the PARC’s approval of the SDP. 2011 filed by private respondents Noel Mallari. 1989. these large parcels of land would have been distributed and ownership transferred to the FWBs. PAYMENT OF JUST COMPENSATION HLI contends that since the SDP is a modality which the agrarian reform law gives the landowner as alternative to compulsory coverage. and Windsor Andaya (collectively referred to as "Mallari. Notably. then it is apparent that said corporations are not obliged to provide for homelots. This is provided under Sec. UPHELD PREVIOUS DECISION: taking was effected on November 21. It further claims that the approval of the SDP is not akin to a Notice of Coverage in compulsory coverage situations because stock distribution option and compulsory acquisition are two (2) different modalities with independent and separate rules and mechanisms. et al. then the value of these homelots should.Before the Court are the Motion to Clarify and Reconsider Resolution of November 22. This claim is bereft of merit. As We have explained in Our July 5. it is the official act by the government. and (4) just compensation for the homelots given to the FWBs. 30 of RA 6657. such approval is akin to a notice of coverage ordinarily issued under compulsory acquisition. sealed with the imprimatur of PARC under PARC Resolution No. as of 1989. be paid to Tadeco as the landowner. et al.915. be considered as the date of "taking" as this was the only time that the agricultural lands of Hacienda Luisita were placed under compulsory acquisition in view of its failure to perform certain obligations under the SDP.51-hectare Subic-Clark-Tarlac Expressway (SCTEX ) land. boil down to the following: (1) determination of the date of "taking"."). Although the transfer of ownership over the agricultural lands was made prior to the SDP’s approval. HOMELOTS In the present recourse. subject to payment of just compensation. Basically. Supervisory Group of Hacienda Luisita. When the agricultural lands of Hacienda Luisita were transferred by Tadeco to HLI in order to comply with CARP through the stock distribution option scheme. Since none of the provisions made reference to corporations which opted for stock distribution under Sec. however. 2006 may. UPHELD PREVIOUS RULING . which should be considered as the reckoning point for the "taking" of the agricultural lands of Hacienda Luisita. given that. 2011 Decision. 1989 What is notable. Concomitantly. the distribution of homelots is required under RA 6657 only for corporations or business associations owning or operating farms which opted for land distribution. the subject 4. And the stubborn fact is that the "man days" scheme of HLI impelled the FWBs to work in the hacienda in exchange for such shares of stock. Inc. Julio Suniga. Tadeco and HLI are two different entities with separate and distinct legal personalities. FWBS ENTITLED TO PROCEEDS OF SALE HLI reiterates its claim over the proceeds of the sales of the 500 hectares and 80. HLI maintains that the Notice of Coverage issued on January 2.51 hectares of the land as corporate owner and argues that the return of said proceeds to the FWBs is unfair and violative of the Corporation Code. 2011 filed by petitioner Hacienda Luisita. Corollarily. HLI also harps on the fact that since the homelots given to the FWBs do not form part of the 4. And as We have mentioned in Our November 22. then the FWBs cannot be considered as owners and possessors of the agricultural lands of Hacienda Luisita at the time the SDP was approved by PARC. Inc. it is this Court’s consistent view that these lands officially became subject of the agrarian reform coverage through the stock distribution scheme only upon the approval of the SDP. We disagree. at the very least. 2011 Resolution. that is. is that the divestment by Tadeco of the agricultural lands of Hacienda Luisita and the giving of the shares of stock for free is nothing but an enticement or incentive for the FWBs to agree with the stock distribution option scheme and not further push for land distribution. 31 of RA 6657.915 hectares of Hacienda Luisita were already covered by CARP. Tadeco was consequently dispossessed of the afore-mentioned attributes of ownership. with the revocation of the SDP. Nonetheless. (HLI) and the Motion for Reconsideration/Clarification dated December 9.were it not for the approval of the SDP by PARC. HLI undertook to "subdivide and allocate for free and without charge among the qualified family- . 89-12-2 dated November 21. 2011 dated December 16. (2) propriety of the revocation of the option on the part of the original FWBs to remain as stockholders of HLI. the issues raised by HLI and Mallari. (3) propriety of distributing to the qualified FWBs the proceeds from the sale of the converted land and of the 80. to pay to HLI the just compensation for the homelots thus distributed to the FWBS. the just compensation for the 240-square meter homelots distributed to the FWBs.: denied to the petitioners. the also allege that Proclamation No.R. the petitioners in this case claim that the power to provide for a Comprehensive Agrarian Reform Program as decreed by the Constitution belongs to the Congress and not to the President. No. agreed to reiterate its ruling in its November 22. resolved to amend its July 5. 4. 79777.O Nos. equal protection and the constitutional limitation that no private property shall be taken for public use without just compensation. through DAR." To recapitulate. in our November 22.O No.R. 2011 Resolution. 229.O No.O Nos. the Court. 3) On the propriety of returning to the FWBs the proceeds of the sale of the 500-hectare converted land and of the 80. FACTS: These are consolidated cases involving common legal questions including serious challenges to the constitutionality of R." the value of the affected lands to be determined by the LBP and the DAR. In G. the petitioner argues that E. No. 228 and 229 on the grounds inter alia of separation of powers." In fact. In G. In G. 79744. 131 and E. 1989 as the date of "taking. the petitioners are questioning the P. 2011 Resolution by ordering the government. J. 2011 Resolution. by unanimous vote. Thus. However.A. taxes and expenses specified in the fallo of the November 22. 229 should be annulled for violation of the constitutional provisions on just compensation. SECRETARY OF DAR CRUZ. HLI was able to distribute homelots to some if not all of the FWBs. through the DAR. We declared that the homelots already received by the FWBs shall be respected with no obligation to refund or to return them. due process. 228 and 229 were invalidly issued by the President and that the said executive orders violate the constitutional provision that no private property shall be taken without due process or just compensation which was ASSOCIATION OF SMALL LANDOWNERS V. They contended that the taking must be simultaneous with payment of just compensation which such payment is not contemplated in Section 5 of the E. m. by unanimous vote. 79310. 2) On the propriety of the revocation of the option of the FWBs to remain as HLI stockholders. 4) On the payment of just compensation for the homelots to HLI. 2011 Resolution that the option granted to the FWBs stays revoked.D No.R. No 78742 the petitioners claim that they cannot eject their tenants and so are unable to enjoy their right of retention because . No. 6657 also known as the "Comprehensive Agrarian Reform Law of 1988" In G.51-hectare SCTEX land.beneficiaries x x x residential or homelots of not more than 240 sq. the Court. Inc. 27 and E. Article XIII of the 1987 Constitution that the taking of land for use in the agrarian reform program is "subject to the payment of just compensation. the government.R. each. the Court unanimously voted to maintain its ruling to order the payment of the proceeds of the sale of the said land to the FWBs less the 3% share. with each family beneficiary being assured of receiving and owning a homelot in the barrio or barangay where it actually resides. due process and equal protection. No. is ordered to pay Hacienda Luisita. 2011 Decision and November 22. the Court directs the government through the DAR to pay HLI the just compensation for said homelots in consonance with Sec. the Court voted on the following issues in this manner: 1) In determining the date of "taking. since the SDP was already revoked with finality." the Court voted 8-6 to maintain the ruling fixing November 21. 00 as provisional value of the land. RULING: Police Power through the Power of Eminent Domain. without modification. REYES. 3837. DALMACIO URTULA. raising the sole issue of whether the amount fixed by the trial court was a just compensation for the property. thus. Luciano M.094. and the defendant Republic of the Philippines. J. owned by Dalmacio Urtula by the Republic of the Philippines. as aforesaid. on 10 September 1958. 3837 of the same court.00. unlike the taking of the property in Eminent Domain or the power of expropriation which requires the payment of just compensation to the owner of the property expropriated. the Republic of the Philippines deposited on 29 July 1958.00.404." The Republic appealed the decision to the Court of Appeals. ET AL. now Land Authority. 5306.690. This Court rendered judgment thereon on 29 November 1960 in case No. for the expropriation of the Hacienda Quitang. for the sum of P213. the Republic paid Dalmacio Urtula . property condemned under police power is noxious or intended for noxious purpose. et al. Of this balance. Judicial Cases Division of Land Tenure Administration for defendantappellant. in its Civil Case No. and as found by the court a quo are as follows: The Court of First Instance had rendered judgment on 16 November 1957 in its Civil Case No.: Direct appeals. Thereafter. the Land Tenure Administration took actual physical possession of the land on 11 October 1958.L. REPUBLIC OF THE PHILIPPINES. J. defendant-appellant. in accordance with an order of the trial court dated 3 January 1958. the compensation for the taking of such property is not subject to compensation. by both the plaintiffs. ISSUE: Whether or not the laws being challenged is a valid exercise of Police power or Power of Eminent Domain.. plaintiffs-appellants.00. the balance still due was P95. "and upon making the payment the plaintiff shall take full possession of the land. Civil Case No. the Court of Appeals found that the issue between the parties was purely one of law and thereby elevated the appeal to the Supreme Court. at the time the decision became final. and under a writ of possession issued by the provincial sheriff of the province. as stipulated by the parties. Dalmacio Urtula. Subsequently. the Court of Appeals granted the Republic's petition to be placed in possession of the property. represented by the Land Tenure Administration.. While the appeal was pending before the Court of Appeals. The Supreme Court had affirmed. L-16028.the Department of Agrarian Reform has so far not issued the implementing rules of the decree. ordering the defendant to pay interest upon a sum determined by final judgment as compensation for the property expropriated in a previous case of eminent domain between the same parties. (represented by the Land Tenure Administration). Maggay for plaintiffs-appellants. They therefore ask the Honorable Court for a writ of mandamus to compel the respondents to issue the said rules. the decision of the trial court fixing the amount of just compensation for P213. from a judgment of the Court of First Instance of Camarines Sur. vs. The facts. affirming the appealed judgment of the Court of First Instance. and this deposit was withdrawn by Dalmacio Urtula in August of 1958.094.B. though there are traditional distinction between the police power and the power of eminent domain. with the Philippine National Bank the sum of P117. and raised no issue requiring remand of the records to the Court of origin.1äwphï1. as attorney's fees.00 on 17 April 1961. when the final balance was paid to Urtula was also computed at a total of P14. as defendant in the expropriation case. 3837. an excess in the amount of P423.404.23 as of 28 February 1962. hence. 230). .ñët Against the defendant Republic's defense that the final judgment in the expropriation case. Thus. operates to bar the present case.00. because the rate of interest upon the amount of just compensation (6%) is a known factor. which did not provide for interest. the theory of plaintiff Urtula is that there is no identity of causes of action in the said cases. both appealed to this Court. Both parties were not satisfied with the decision.404. Understood as such. including penalties.00 from 11 October 1958 to 3 May 1961 and to pay the costs. could have raised the matter of interest before the trial court even if there had been no actual taking yet by the Republic and the said court could have included the payment of interest in its judgment but conditioned upon the actual taking. but denied the plaintiff's claim on the land taxes 1 and attorney's fees. On liquidation at a later date. Moreover. the trial court rendered judgment for plaintiff Urtula and ordered the defendant Republic to pay P14.633. the Republic paid the remaining balance of P90.38 was found. The taxes due and unpaid. the plaintiff demanded payment of said interest (P14. by res judicata. the date when the condemnor Republic took possession of the land to May 1961. In this way. Said interest is not contractual. nothing prevented appellee from calling the attention of the appellate courts (even by motion to reconsider before judgment became final) to the subsequent taking of possession by the condemnor. Urtula. on the land for the years 1959.J. as of the date of the taking (30 C. multiple suits would be avoided.00 from 11 October 1958.R.52) but the defendant Republic refused. The interest of 6% on P95. nor based on delict or quasi-delict. though the date be not fixed. 1960 and 70% of 1961 were computed at a total of P3. Urtula relates his predicaments as follows: that while the expropriation case was pending before the trial court. aside from his being impeded by the rule that proof with respect to the taking of possession had to be adduced before the trial court. since that followed the taking as a matter of course. The parties further stipulated as a fact that the plaintiff had agreed to pay his counsel 10% of the amount recoverable from the defendant. but one that — runs as a matter of law and follows as a matter of course from the right of the landowner to be placed in as good a position as money can accomplish. the case was already on appeal and he could not ask relief because he was not an appellant nor could he raise the issue of interest for the first time on appeal.633. but when the Republic took possession.000. L-16028.the sum of P5. Urtula deposited same amount with the Land Tenure Administration in payment of taxes and penalties for prior years up to 1958 on the expropriated land and for the surveyor's fee for segregating one hectare donated by condemnee Urtula for a school site. or in the affirmatory decision of the Supreme Court in G. and the Republic refunded this excess to Urtula on 25 September 1961. On 26 January 1961. he could not claim interest because the Republic had not as yet taken possession of the land and the rule is that interest accrues from the time of such taking. Upon the foregoing stipulated facts. Urtula's dilemma lies in his mistaken concept of the nature of the interest that he failed to claim in the expropriation case and which he now claims in this separate case. the expropriator would take possession of the property. but on the same day.404. not the appellate court.S. No.52. On 3 May 1961.52 as interest on the balance of P95. and asking for allowance of interest on the indemnity. the expropriation proceedings.534. on the ground that no payment of interest had been ordered in the decision in Civil Case No. and it can reasonably be expected that at some future time.633. except those of rival claimants litigating their claims. Rule 67 of the old Rules. the Batasang Pambansa passed B. FOR THE FOREGOING REASONS. the Knechts constructed eight houses. L-17476.) 2 As it is. KNECHT VS. 108015. the City Treasurer of Pasay discovered that the Knechts failed to pay real estate taxes on the property from 1980 to 1982. et al. as between the parties. The property of the . 2009 Posted by Coffeeholic Writes Labels: Case Digests. NO. On February 17.B. (City of Manila vs.) But the present case is not one of eminent domain but an ordinary civil action where the Republic of the Philippines is a party. 49. Rodriguez vs. It follows that interest upon the unrecoverable interest.. Rene Knecht. therefore. .P. From this date. but all matters that could have been adjudged at the time (Rule 39. the government filed for the expropriation of Knechts’ property. Subsequently. are charged against the plaintiff. Corda vs. directs the defendant in an expropriation case to "present in a single motion to dismiss or for other appropriate relief. . 4. leased out the seven and occupied one of them as their residence. 215). Costs in cases of eminent domain. the appealed judgment is reversed and the case dismissed. 1961. 61 Phil. hence. res judicata blocks the recovery of interest in the present case. It is settled that a former judgment constitutes a bar. 13. Roxas. Ceniza. 12. Sangalang and Babiera sold the land to respondent Salem Investment Corporation. 1962). No provision of law providing the contrary has been cited. 1983. L-17834. which plaintiff also seeks. As a consequence of this deficiency. Gaz. Rules of Court. 340 authorizing the national government to expropriate certain properties in Pasay City for the EDSA Extension. likewise. The highest bidders were respondent Spouses Anastacio and Felisa Babiera (the Babieras) and respondent Spouses Alejandro and Flor Sangalang (the Sangalangs). Rule 67. Political Law Facts: The instant case is an unending sequel to several suits commenced almost twenty years ago involving a parcel of land located at the corner of the south end of EDSA and F. 29 Sept. Section 1 of Rule 142 provides that no costs shall be allowed against it. (Tejedor vs. 48 Off. Harrison in Pasay City. etc. costs should be charged against Urtula. vs. sec. Engineering Corp. et al. all of his objections and defenses . Tan. Nov. 3330).." and if not so presented "are waived. be granted.. in fact. unless otherwise provided by law. the judgment allowing the collection of interest. 60 Phil. not only as to matters expressly adjudged." (Emphasis Supplied. The government wanted to use the land for the completion of the Manila Flood Control and Drainage Project and the extension of the EDSA towards Roxas Boulevard. The land was owned by petitioners Cristina de Knecht and her son. Phil. 494. now under appeal in effect amends the final judgment in the expropriation case. the City Treasurer sold the property at public auction for the same amount of their deficiency taxes. On the land. Sec. (Sec. The Republic took possession on 11 October 1958. Maglinti. Palet. the owner. G. with costs against the plaintiffs Dalmacio Urtula. 20 MAY 1998] Saturday. In 1979.As the issue of interest could have been raised in the former case but was not raised. was deprived of the benefits from the land and it is just and fair that realty taxes for the years 1959 and onward should be borne by the entity exercising the right of eminent domain. et al. January 31. COURT OF APPEALS [290 SCRA 223. while retaining the naked title. Blg. a procedure abhorrent to orderly judicial proceedings. Rule 69 of the old Rules). In 1982. 30. It is not amiss to note that Section 3 of Rule 67 of the Revised Rules of Court (Sec. cannot.R. The Knechts' right to the land had the parties to the preservation of the public tranquility. It is a rule for unlawful detainer. Salem was included and received partial Knechts therefore are not the lawful owners of the land and are not payment. However. public The Knechts continuously claimed ownership of the property and policy and necessity. The Municipal Trial Court however ordered determined by a prior and final judgment.Knechts was part of those expropriated under B. that there should be a limit to litigation. the order of dismissal became final and res judicata on the by a court having jurisdiction over the subject matter and the issue of ownership of the land. the judgment of the court. this question has been . The under B. unreversed. regulated system of jurisprudence. and is based upon two grounds embodied in various maxims of the common law — one. It pervades every well- the Knechts' ejectment thus their residence was demolished. identity not receive notice of their tax delinquency. land on which the houses stood. been foreclosed after they failed to redeem it one year after the sale at public auction. Salem filed a case against them Note: Res judicata is a ground for dismissal of an action. Since the Knechts refused to vacate their one remaining house. so long as it remains subject. Res judicata has already set it. Seven of the eight houses of the Knechts were any longer accountable for just compensation given by the demolished and the government took possession of the portion of government. cause. the Knechts claimed ownership of that precludes parties from relitigating Issue actually litigated and the land and building. Petitioners contended that they did parties. notice of the auction sale. of subject matter and of cause of action. When a right of fact has been judicially tried and determined by a court of competent jurisdiction. government gave out just compensation for the lands expropriated The court is not a trier of facts. should be conclusive upon the parties and those in privity with them in law or estate. Neither did they receive of parties. the individual should not be vexed twice for the same that they must be given just compensation. and allege another. Blg. 340. (3) it was rendered Court. Since the petitions questioning the order of Res judicata applies when: (1) the former judgment or order is final. To follow a contrary doctrine would subject the public peace and quiet to the will and neglect of Held: The Supreme Court held that the Knechts were not the individuals and prefer the gratification of the litigious disposition of owners anymore of the said land. (4) there is between the first and second actions. Blg. As defense.P. The previously raised in the cases which have been already set aside. dismissal were likewise dismissed by the Court of Appeals and this (2) the judgment or order is one on the merits. or an opportunity for such trial Issue: Whether or not Knechts are the lawful owners of the land at has been given.P. 340.