Court Opinion

ID: 8538191
Source: CourtListenerOpinion
Date Created: 2022-11-23 11:08:46.222723+00
Date Added: 2024-06-11T16:52:08.768040
License: Public Domain

Mr. Justice Blanco Lugo,
with whom Mr. Justice Rigau, Mr. Justice Dávila, and Mr. Justice Ramirez Bages concur,
dissenting.
San Juan, Puerto Rico, June 5, 1964
I share the preoccupation voiced in the majority opinion aimed at preventing that economic values extraneous to the cost of construction be taken into consideration in fixing rents. Such is the philosophy underlying the legislative criterion, and it deserves our deference. However, I cannot subscribe to certain assertions made in that opinion. Briefly stated, they are two: (1) That the cost of the buildings demolished in order to construct a new one should not be taken into consideration in any case for the purpose of establishing the cost of construction of the latter; and (2) that, for tax purposes, the cost of the lot, raised to its totality, be used in all cases as element for the purpose of establishing the cost of construction.
Regarding the cost of the buildings demolished, I believe that it is proper to grant the historical cost thereof, namely, the value assigned when the lot and the building was acquired. Only then would this prevent causing patrimonial deterioration to the builder in the computation of the reason*537able yield. His investment certainly is not only the cost of the lot but also that of the building which he demolishes in order to make better economic use of the lot. In this sense the cost of the building is merged with that of the lot.
I agree that it is proper to include the cost of the lot in the cost of construction. However, there is no provision authorizing the Administrator to consider therefor the market value thereof, even fixing the same on the basis of the assessment for tax purposes.1 Contrary to the situation in connection with buildings demolished, this regulation grants to the property owner a value to which he is not entitled in the fixing of the rent. It is known that the lot market in Puerto Rico responds to a standard of ascending spiral.2 I maintain that the property owner should receive only the yield corresponding to his investment, which is but the cost of acquisition. There is no justification for granting to him as element of cost an increase in value which responds to certain economic realities extraneous to Ms investment.
It appears clearly that the majority opinion applies a double standard.

 In People v. Amadeo, 82 P.R.R. 98 (1961), we held that the official determinations regarding the valuation for the purposes of property taxation do not constitute admissible evidence of the market value in condemnation proceedings.

 Negrón García, Luis, Impacto del Aumento en el Costo de las Tierras en Puerto Rico: La Administración de Terrenos como Instrumento del Urbanismo, XXXII Rev. Jur. U.P.R. 451 (1963).