Source: http://lawlibrary.chanrobles.com/index.php?option=com_content&amp;view=article&amp;id=84314:60523&amp;catid=1594&amp;Itemid=566
Timestamp: 2019-04-24 02:25:14+00:00

Document:
G.R. No. 191945, March 11, 2015 - NATIONAL POWER CORPORATION, Petitioner, v. SOCORRO T. POSADA, RENATO BUENO, ALICE BALIN, ADRIAN TABLIZO, TEOFILO TABLIZO, AND LYDIA T. OLIVO, SUBSTITUTED BY HER HEIRS, ALFREDO M. OLIVO, ALICIA O. SALAZAR, ANITA O. ORDONO, ANGELITA O. LIM, AND ADELFA O. ESPINAS, Respondents.
NATIONAL POWER CORPORATION, Petitioner, v. SOCORRO T. POSADA, RENATO BUENO, ALICE BALIN, ADRIAN TABLIZO, TEOFILO TABLIZO, AND LYDIA T. OLIVO, SUBSTITUTED BY HER HEIRS, ALFREDO M. OLIVO, ALICIA O. SALAZAR, ANITA O. ORDONO, ANGELITA O. LIM, AND ADELFA O. ESPINAS, Respondents.
When the taking of private property is no longer for a public purpose, the expropriation complaint should be dismissed by the trial court. The case will proceed only if the trial court's order of expropriation became final and executory and the expropriation causes prejudice to the property owner.
Before this court is a Motion1 filed by the National Power Corporation seeking to withdraw its Petition for Review2 dated June 4, 2010. The Petition sought to reverse the Decision3 of the Court of Appeals dated August 7, 2009, which affirmed the trial court's Decision recalling the Writ of Possession issued in the National Power Corporation's favor.
WHEREFORE, all factors carefully evaluated and considered, this Court, hereby, fixes the just compensation at TWO THOUSAND PESOS (P2,000.00) per square meter for the taking of the properties of [respondents] by [petitioner].
LIKEWISE, in view of NPC's failure to comply with the Court's order dated June 5, 2006 and for misleading this Court when it filed its Motion for the Issuance of Writ of Possession, this Court, hereby, RECALLS its order granting said Motion and CANCELS the Writ of Possession.
AND, AS A FINAL NOTE, the amount determined by the Court in said Order represents only the value of the structures and improvements and does not include the value of the land. Even if said amount is fully. paid by NPC, still it would not be entitled to a Writ of Possession until it has paid the value of the land. And what should be its value? Is it the zonal valuation of the Bureau of Internal Revenue? Under Section 4 of Rep. [A]ct. No. 8974, payment of one hundred [percent] (100%) of the value of the property based on the current relevant zonal valuation of the Bureau of Internal Revenue is required upon the filing of the complaint, and after due notice to the defendant. This Court believes that this basis is used because the just compensation is yet to be determined during the second stage of the expropriation proceeding. In the instant case, the complaint has long been filed, and the just compensation has already been determined above. Therefore, it should now be the basis for the re-issuance of a Writ of Possession - nay, even the transfer of ownership if fully paid.
The National Power Corporation filed a Motion for Reconsideration, but this was denied in the Resolution32 dated April 14, 2010. Hence, it filed a Petition for Review on Certiorari before this court.
Respondents filed their Comment33 on September 17, 2010. The National Power Corporation filed its Reply34 to the Comment, substantially reiterating the arguments in its Petition.
On March 11, 2013, this court issued a Resolution37 deferring action on the Motion for the Issuance of a Temporary Restraining Order.
We are asked to decide whether the National Power Corporation may be allowed to withdraw its Petition for Review and whether the withdrawal has the effect of dismissing its Amended Complaint before the trial court.
The power of eminent domain is an inherent competence of the state. It is essential to a sovereign. Thus, the Constitution does not explicitly define this power but subjects it to a limitation: that it be exercised only for public use and with payment of just compensation.45 Whether the use is public or whether the compensation is constitutionally just will be determined finally by the courts.
However, the manner of its exercise such as which government instrumentality can be delegated with the power to condemn,' under what conditions, and how may be limited by law. Republic Act No. 8974 does these, but it should not be read as superseding the power of this court to promulgate rules of procedure. Thus, our existing rules should be read in conjunction with the law that limits and conditions the power of eminent domain.
The first phase of expropriation commences with the filing of the complaint. It ends with the order of the trial court to proceed with the expropriation and determination of just compensation. During the pendency of the complaint before the trial court, the state may already enter and possess the property subject to the guidelines in Rule 67 of the Rules of Court.
Rule 67 of the Rules of Court, however, is not the only set of rules that governs the first phase of expropriation. On November 7, 2000, Congress enacted Republic Act No. 8974 to govern the expropriation of private property for national government infrastructure projects. The law qualifies the manner by which the government may enter and take possession of the property to be expropriated.
Sec. 2. Entry of plaintiff upon depositing value with authorized government depositary. — Upon the filing of the complaint or at any time thereafter and after due notice to the defendant, the plaintiff shall have the right to take or enter upon the possession of the real property involved if he deposits with the authorized government depositary an amount equivalent to the assessed value of the property for purposes of taxation to be held by such bank subject to the orders of the court. Such deposit shall be in money, unless in lieu thereof the court authorizes the deposit of a certificate of deposit of a government bank of the Republic of the Philippines payable on demand to the authorized government depositary.
As stated in Gingoyon, Republic Act No. 8974 "provides for a procedure eminently more favorable to the property owner than Rule 67"47 since it requires the immediate payment of the zonal value and the value of the improvements on the land to the property owner before the trial court can allow the government to take possession. In contrast, Rule 67 only requires the government to deposit the assessed value of the property for it to enter and take possession.
The purpose for the taking of private property was for the construction of the National Power Corporation's Substation Island Grid Project. According to the Implementing Rules and Regulations of Republic Act No. 8974, projects related to "power generation, transmission and distribution"54 are national infrastructure projects covered by the law. The National Power Corporation must first comply with the guidelines stated in Republic Act No. 8974 before it can take possession of respondents' property.
The trial court allowed the National Power Corporation to take possession of the properties because of its deposit with Land Bank of the Philippines of the alleged provisional value. However, the trial court recalled the Writ of Possession because the National Power Corporation failed to deposit the additional amount.
We find that the trial court erred, not in recalling the Writ of Possession, but in granting the Writ of Possession in the first place.
Section 4 of Republic Act No. 8974, unlike Rule 67, Section 2 of the Rules of Civil Procedure, requires immediate payment to the landowner of 100% of the value of the property based on the current relevant zonal valuation of the Bureau of Internal Revenue. It is the Bureau of Internal Revenue, not the court, which determines the zonal value.
The law also requires the immediate payment of the value of the improvements and/or structures on the land before the trial court can issue the Writ of Possession.
Section 7. Valuation of Improvements and/or Structures. - The Department of Public Works and Highways and other implementing agencies concerned, in coordination with the local government units concerned in the acquisition of right-of-way, site or location for any national government infrastructure project, are hereby mandated to adopt within sixty (60) days upon approval of this Act, the necessary implementing rules and regulations for the equitable valuation of the improvements and/or structures on the land to be expropriated.
According to the law, it is the implementing agency, not the commissioners, that determines the proffered value of the improvements and structures. A Writ of Possession may be issued once there is confirmation by the trial court of the proffered value.
There are, of course, instances when immediate payment cannot be made even if the implementing agency is willing to do so. The owner of the property is not precluded from contesting the power of the implementing agency to exercise eminent domain, the necessity of the taking, the public character of its use, or the proffered' value by the implementing agency. In these instances, the implementing agency may deposit the proffered value with the trial court having jurisdiction over the expropriation proceedings.
The recall of an improperly issued Writ of Possession is not the same as an injunction.
The National Power Corporation's argument that the recall of a Writ of Possession amounts to an injunctive writ prohibited under Section 3 of Republic Act No. 8975 is without merit.
The recall of a Writ of Possession for failure to comply with the guidelines of Section 4 of Republic Act No. 8974 is not the same as the issuance of an injunctive writ. The first is an action by the trial court to correct an erroneous issuance while the second is an ancillary remedy to preserve rights.
In expropriation cases involving national infrastructure projects, the trial court issues a Writ of Possession upon compliance by the implementing agency of the guidelines stated in Section 4 of Republic Act No. 8974. If it is later found that the guidelines were not complied with, the trial court recalls the Writ of Possession for being improperly issued.
When a trial court recalls a Writ of Possession in an expropriation proceeding, the parties do not revert to status quo, i.e. the status of the parties before the expropriation complaint was filed. The trial court's order of condemnation stands regardless of whether a Writ of Possession was already issued.
In accordance, however, with Rule 67, Section 4 of the Rules of Civil Procedure,69 the trial court proceeded with the second phase of expropriation, that is, the determination of just compensation.
Upon compliance with the requirements, a petitioner in an expropriation case ... is entitled to a writ of possession as a matter of right and it becomes the ministerial duty of the trial court to forthwith issue the writ of possession. No hearing is required and the court neither exercises its discretion or judgment in determining the amount of the provisional value of the properties to be expropriated as the legislature has fixed the amount under Section 4 of R.A. 8974.
The first refers to the preliminary or provisional determination of the value of the property. It serves a double-purpose of pre-payment if the property is fully expropriated, and of an indemnity for damages if the proceedings are dismissed. It is not a final determination of just compensation and may not necessarily be equivalent to the prevailing fair market value of the property. Of course, it may be a factor to be considered in the determination of just compensation.
Just compensation, on the other hand, is the final determination of the fair market value of the property. It has been described as "the just and complete equivalent of the loss which the owner of the thing expropriated has to suffer by reason of the expropriation." Market values, has [sic] also been described in a variety of ways as the "price fixed by the buyer and seller in the open market in the usual and ordinary course of legal trade and competition; the price and value of the article established as shown by sale, public or private, in the ordinary way of business; the fair' value of the property between one who desires to purchase and one who desires to sell; the current price; the general or ordinary price for which property may be sold in that locality.
The statutory requirement to pay a provisional amount equivalent to the full Bureau of Internal Revenue zonal valuation does' not substitute for the judicial determination of just compensation. The payment to the property owner of a preliminary amount is one way to ensure that property will not be condemned arbitrarily. It allows frontloading the costs of the exercise so that it is the government instrumentality that bears the burden and not the owner whose property is taken.
The National Power Corporation was only required to pay the provisional value so that it could take possession of respondents' properties. Ordinarily, the government, in accordance with Rule 67 or Republic Act No. 8974, would have already taken possession of the property before the proper amount of just compensation could be determined by the court.
In esse, expropriation is forced private property taking, the landowner being really without a ghost of a chance to defeat the case of the expropriating agency. In other words, in expropriation, the private owner is deprived of property against his will. Withal, the mandatory requirement of due process ought to be strictly followed, such that the state must show, at the minimum, a genuine need, an exacting public purpose to take private property, the purpose to be specifically alleged or least reasonably deducible from the complaint.
Public use, as an eminent domain concept, has now acquired an expansive meaning to include any use that is of "usefulness, utility, or advantage, or what is productive of general benefit [of the public]. " If the genuine public necessity—the very reason or condition as it were— allowing, at the first instance, the expropriation of a private land ceases or disappears, then there is no more cogent point for the government's retention of the expropriated land. The same legal situation should hold if the government devotes the property to another public use very much different from the original or deviates from the declared purpose to benefit another private person. It has been said that the direct use by the state of its power to oblige landowners to renounce their productive possession to another citizen, who will use it predominantly for that citizen's own private gain, is offensive to our laws.
It is the state that bears the burden of proving that the taking of private property is for a public purpose. If it fails in discharging this burden, it must return the property to the private owner, subject to whatever damages were incurred in the course of the taking.
Mactan-Cebu International Airport Authority [v. Court of Appeals] is correct in stating that one would not find an express statement in the Decision in Civil Case No. R-1881 to the effect that "the [condemned] lot would return to [the landowner] or that [the landowner] had a right to repurchase the same if the purpose for which it was expropriated is ended or abandoned or if the property was to be used other than as the Lahug Airport." This omission notwithstanding,.and while the inclusion of this pronouncement in the judgment of condemnation would have been ideal, such precision is not absolutely necessary nor is it fatal to the cause of petitioners herein. No doubt, the return or repurchase of the condemned properties of petitioners could be readily justified as the manifest legal effect or consequence of the trial court's underlying presumption that "Lahug Airport will continue to be in operation" when it granted the complaint for eminent domain and the airport discontinued its activities.
The predicament of petitioners involves a constructive trust, one that is akin to the implied trust referred to in Art. 1454 of the Civil Code, "If an absolute conveyance of property is made in order to secure the performance of an obligation of the grantor toward the grantee, a trust by virtue of law is established. If the fulfillment of the obligation is offered by the grantor when it becomes due, he may demand the reconveyance of the property to him." In the case at bar, petitioners conveyed Lots Nos. 916 and 920 to the government with the latter obliging itself to use the realties for the expansion of Lahug Airport; failing to keep its bargain, the government can be compelled by petitioners to reconvey the parcels of land to them, otherwise, petitioners would be denied the use of their properties upon a state of affairs that was not conceived nor contemplated when the expropriation was authorized.
Although the symmetry between the instant case and the situation contemplated by Art. 1454 is not perfect, the provision is undoubtedly applicable. For, as explained by an expert on the law of trusts: "The only problem of great importance in the field of constructive trusts is to decide whether in the numerous and varying fact situations presented to the courts there is a wrongful holding of property and hence a threatened unjust enrichment of the defendant." Constructive trusts are fictions of equity which are bound by no unyielding formula when they are used by courts as devices to remedy any situation in which the holder of the legal title may not in good conscience retain the beneficial interest.
The rights and obligations between the constructive trustee and the beneficiary, in this case, respondent MCIAA and petitioners over Lots Nos. 916 and 920, are echoed in Art. 1190 of the Civil Code, "When the conditions have for their purpose the extinguishment of an obligation to give, the parties, upon the fulfillment of said conditions, shall return to each other what they have received . . . In case of the loss, deterioration or improvement of the thing, the provisions which, with respect to the debtor, are laid down in the preceding article shall be applied to the party who is bound to return. ..."
Hence, respondent MCIAA as representative of the State is obliged to reconvey Lots Nos. 916 and 920 to petitioners who shall hold the same subject to existing liens thereon, i.e., leasehold right ofDPWH. In-return, petitioners as if they were plaintiff beneficiaries of a constructive trust must- restore to respondent MCIAA what they received as just compensation for the expropriation of Lots Nos. 916 and 920 in Civil Case No. R-1881, i.e., P7.065.00 for Lot No. 916 and P9,291.00 for Lot No. 920 with consequential damages by way of legal interest from 16 November 1947. Petitioners must likewise pay respondent MCIAA the necessary expenses it may have incurred in sustaining the properties and the monetary value of its services in managing them to the extent that petitioners will be benefited thereby. The government however may keep whatever income or fruits it may have obtained from the parcels of land, in the same way thai petitioners need not account for the interests that the amounts they received as just compensation may have earned in the meantime. As a matter of justice and convenience, the law considers the fruits and interests as the equivalent of each other.
Under Art. 1189 of the Civil Code, "If the thing is improved by its nature, or by time, the improvement shall inure to the benefit of the creditor . . .," the creditor being the person who stands to receive something as a result of the process of restitution. Consequently petitioners as creditors do not have to settle as part of the process of restitution the appreciation in value of Lots Nos. 916 and 920 which is the natural consequence of nature and time.
The National Power Corporation now requests this court for leave to withdraw this Petition on the ground that it was in the process of acquiring a vacant lot owned by FICELCO. Considering that eminent domain is the taking of private property for public use, no expropriation proceeding can continue if the property to be expropriated will not be for public use.
The right of the plaintiff to dismiss an action with the consent of the court is universally recognized with certain well-defined exceptions. If the plaintiff discovers that the action which he commenced was brought for the purpose of enforcing a right or a benefit, the advisability or necessity of which he later discovers no longer exists, or that the result of the action would be different from what he had intended, then he should be permitted to withdraw his action, subject to the approval of the court. The plaintiff should not be required to continue the action, subject to-some well-defined exceptions, when it is not to his advantage to do so. Litigation should be discouraged and not encouraged. Courts should not require parties to litigate when they no longer desire to do so. Courts, in granting permission to dismiss an action, of course, should always take into consideration the effect which said dismissal would have upon the rights of the defendant.
Considering that the National Power Corporation is no longer using respondents' properties for the purpose of building the Substation Project, it may be allowed to discontinue with the expropriation proceedings, subject to the approval of the court.
Notably, [City of Manila and Water District] refer to the dismissal of an action for eminent domain at the instance of the plaintiff during the pendency of the case. The rule is different where the case had been decided and the judgment had already become final and executory.
In the case at bar, petitioner did not appeal the Order of the trial court dated December 10, 1999, which declared that it has a lawful right to expropriate the properties of respondent Heirs of Isidro1 Guivelondo. Hence, the Order became final and may no longer be subject to review or reversal in any court. A final and executory decision or order can no longer be disturbed or reopened no matter how erroneous it may be. Although judicial determinations are not infallible, judicial error should be corrected through appeals, not through repeated suits on the same claim.
Lastly, the expropriation case already caused prejudice to the landowner.
The expropriation case is not automatically dismissed when the property ceases to be for public use. The state must first file the appropriate Motion to Withdraw before the trial court having jurisdiction over the proceedings. The grant or denial of any Motion to Withdraw in an expropriation proceeding is always subject to judicial discretion.
Respondents have not yet been deprived of their property since the National Power Corporation was never able to take possession. We cannot determine whether damages have been suffered as a result of the expropriation. This case needs to be remanded to the trial court to determine whether respondents have already been prejudiced by the expropriation.
WHEREFORE, the Motion to Withdraw Appeal dated August 28, 2014 is GRANTED insofar as it withdraws the Petition for Review dated June 4, 2010. The Motion for Leave to File Comment (to Petitioner's Motion to Withdraw Appeal) dated September 30, 2014 is NOTED. This case is REMANDED to the Regional Trial Court of Virac, Catanduanes, Branch 43 for appropriate action.
Carpio, J., Chairperson, Brion, Del Castillo, and Mendoza, JJ., concur.
3 Id. at 42-56. The Decision, docketed as CA-G.R. CV No. 89342, was penned by Associate Justice Jose L. Sabio, Jr. (Chair) and concurred in by Associate Justices Vicente S.E. Veloso and Ricardo R. Rosario of the Sixth Division.
Sec. 2. Entry of plaintiff upon depositing value with authorized government depositary. — Upon the filing of the complaint or at any time thereafter and after due notice to the defendant, the plaintiff shall have the right to take or enter upon the possession of the real property involved if he deposits with the authorized government, depositary an amount equivalent to the assessed value of the property for purposes of taxation to be held by such bank subject to the orders of the court. Such deposit shall be in money, unless in lieu thereof the court authorizes the deposit of a certificate of deposit of a government bank of the Republic of the Philippines payable on demand to the authorized government depositary.
20 This amount, however, appears to be incorrect since the National Power Corporation alleged that it deposited P580,769.93 while the trial court stated that the National Power Corporation deposited P564,360.83.
29 514 Phil. 657 (2005) [Per J. Tinga, En Banc].
44 An Act to Facilitate the Acquisition of Right-of-way, Site or Location for National Government Infrastructure Projects and for Other Purposes (2000).
45 CONST., art. III, sec. 9.
46Municipality of Binan v. Judge Garcia, 259 Phil. 1058, 1068-1069 (1989) [Per J. Narvasa, First Division].
47Republic v. Judge Gingoyon, 514 Phil. 657 (2005) [Per J. Tinga, En Bane].
54 Implementing Rules and Regulations of Rep. Act No. 8974 (2000), sec. 2(d).
55Republic v. Judge Gingoyon, 514 Phil. 657, 700 (2005) [Per J. Tinga, En Banc].
An Act to Ensure the Expeditious Implementation and Completion of Government Infrastructure Projects by Prohibiting Lower Courts from Issuing Temporary Restraining Orders, Preliminary Injunctions or Preliminary Mandatory Injunctions, Providing Penalties for Violations thereof, and for Other Purposes.
60 FICELCO is the only electric power distributor in the Province of Catanduanes.
(a) The application in the action or proceeding is verified, and shows facts entitling the applicant to the relief demanded.
63 669 Phil. 173 (2012) [Per J. Bersamin, First Division].
64 Id. at 186, citing RULES OF CIVIL PROCEDURE, Rule 58, sees. 1 and 3.
65 496 Phil. 853 (2005) [Per J. Tinga, Second Division].
66 Id. at 869, citing CONST., art. VIII, sec. 1.
67 501 Phil. 646 (2005) [Per J. Chico-Nazario, Second Division].
68 Id. at 664, citing Capitol Medical Center, Inc. v. Court of Appeals, 258-A Phil. 271, 282 (1989) [Per J. Griño-Aquino, First Division].
Sec. 4. Order of expropriation. — If the objections to and the defenses against the right of the plaintiff to expropriate the property are overruled or when no party appears to defend as required by this Rule, the court may issue an order of expropriation declaring that the plaintiff has a lawful right to take the property sought to be expropriated, for the public use or purpose described in the complaint, upon the payment of just compensation to be determined as of the date of the taking of the property or the filing of the complaint, whichever came first.
70 539 Phil. 644 (2006) [Per J. Carpio Morales, Third Division].
71 Id. at 659-660, citing City of Iloilo v. Judge Legaspi, 486 Phil. 474, 490 (2004) [Per J. Chico-Nazario, Second Division] and Republic v. Judge Gingoyon, 517 Phil. 1,13 (2006) [Per J. Tinga, En Banc].
72 G.R. No. 187604, June 25, 2012, 674 SCRA 378 [Per J. Abad, Third Division].
SECTION 19. Eminent Domain. - A local government unit may, through its chief executive and acting pursuant to an ordinance, exercise the power of eminent domain for public use, or purpose or welfare for the benefit of the poor and the landless, upon payment of just compensation, pursuant to the provisions of the Constitution and pertinent laws: Provided, however, That the power of eminent domain may not be exercised unless a valid and definite offer has been previously made to the owner, and such offer was not accepted: Provided, further, That the local government unit may immediately take possession of the property upon the filing of the expropriation proceedings and upon making a deposit with the proper court of at least fifteen percent (15%) of the fair market value of the property based on the current tax declaration of the property to be expropriated: Provided, finally, That the amount to be paid for the expropriated property shall be determined by the proper court, based on the fair market value at the time of the taking of the property.
74City of Manila v. Alegar Corporation, G.R. No. 187604, June 25, 2012, 674 SCRA 378 [Per J. Abad, Third Division], citing Capitol Steel Corporation v. PH1VIDEC Industrial Authority, 539 Phil. 644, 660 (2006) [Per J. Carpió Morales, Third Division] and Visayan Refining Company v. Camus and Paredes, 40 Phil. 550, 563 (1919) [Per J. Street, En Banc].
75 233 Phil. 313 (1987) [Per J. Gutierrez, Jr., En Banc].
78 657 Phil. 391 (2011) [Per J. Velasco, Jr., First Division].
79 Id. at 418—419, citing FR. JOAQUIN G. BERNAS, THE 1987 CONSTITUTION OF THE REPUBLIC OF THE PHILIPPINES: A COMMENTARY 391 (2003) and Heirs of Moreno v. Mactan-Cebu International Airport Authority, 459 Phil. 948 (2003) [Per J. Bellosillo, Second Division].
80 459 Phil. 948 (2003) [Per J. Bellosillo, Second Division].
84 Id. at 965-968, citing Mactan-Cebu International Airport Authority v. Court of Appeals, 399 Phil. 695, 706 (2000) [Per J. Gonzaga-Reyes, Third Division], G. G. BOGERT, HANDBOOK OF THE LAW OF TRUSTS, 208-210 (1963), CIVIL CODE, art. 1187, and Coleongco v. Regalado and Montilla, 92 Phil. 387, 392-393 (1952) [Per J. Felix, En Bane].
87 452 Phil. 481 (2003) [Per J. Ynares-Santiago, First Division].
88 Id. at 489-91, citing City of Manila v. Ruymann, 37 Phil. 421, 424-425 (1918) [Per J. Johnson, En Banc] and Metropolitan Water District v. De los Angeles, 55 Phil. 776, 782 (1931) [Per J. Johnson, En Banc].
89 Id. at 491—95, citing Padillo v. Court of Appeals, 422 Phil. 334, 353 (2001) [Per J. De Leon, Jr., Second Division], Manila Electric Company v. Philippine Consumers Foundation, Inc., 425 Phil. 65, 83 (2002) [Per J. Sandoval-Gutierrez, En Banc], and Cosculluela v. Court of Appeals, 247 Phil. 359, 367 (1988) [Per J. Gutierrez, Jr., Third Division].

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