Lutz vs Araneta, G.R. No.
L-7859, December 22, 1955 singling out of one particular class for taxation, or exemption
FACTS:
Walter Lutz, in his capacity as judicial administrator of the
intestate estate of Antonio Ledesma, sought to recover from
the CIR the sum of P14,666.40 paid by the estate as taxes,
under section 3 of the Commonwealth Act of 567 or the Sugar
Adjustment Act thereby assailing its constitutionality, for it
provided for an increase of the existing tax on the manufacture
of sugar, alleging that such enactment is not being levied for a
public purpose but solely and exclusively for the aid and
support of the sugar industry thus making it void and
unconstitutional. The sugar industry situation at the time of
the enactment was in an imminent threat of loss and needed
to be stabilized by imposition of emergency measures. The
action having been dismissed by the Court of First Instance, the
plaintiffs appealed the case directly to this Court
ISSUE:
Is CA 567 constitutional, despite its being allegedly violative of
the equal protection clause, the purpose of which is not for the
benefit of the general public but for the rehabilitation only of
the sugar industry? RULING: The decision appealed from is
affirmed, with costs against appellant.
RATIO:
YES. CA 567 is constitutional. The protection and promotion of
the sugar industry is a matter of public concern, it follows that
the Legislature may determine within reasonable bounds what
is necessary for its protection and expedient for its promotion.
Here, the legislative discretion must be allowed to fully play,
subject only to the test of reasonableness and it is not
contended that the means provided in the law bear no relation
to the objective pursued or are oppressive in character. If
objective and methods are alike constitutionally valid, no
reason is seen why the state may not levy taxes to raise funds
for their prosecution and attainment. Analysis of the Act, will
show that the tax is levied with a regulatory purpose, to
provide means for the rehabilitation and stabilization of the
threatened sugar industry. In other words,
Taxation may be made the implement of the state's police
power.
That the tax to be levied should burden the sugar producers
themselves can hardly be a ground of complaint; indeed, it
appears rational that the tax be obtained precisely from those
who are to be benefited from the expenditure of the funds
derived from it. At any rate, it is inherent in the power to tax
that a state be free to select the subjects of taxation, and it has
been repeatedly held that "inequalities which result from a
1
infringe no constitutional limitation."
Ortigas & Co. v. CA (
FACTS:
Ortigas & Co. sold to Emilia Hermoso a parcel of land located
in Greenhills Subdivision, San Juan with several restrictions in
the contract of sale that said lot be used exclusively for
residential purposes, among others, until December 31, 2025.
Later, a zoning ordinance was issued by MMC (now MMDA)
reclassifying the area as commercial. Private respondent
(Ismael Mathay III) leased the subject lot from Hermoso and
built a single storey building for Greenhills Autohaus, Inc., a car
sales company. Ortigas & Co. filed a petition a complaint which
sought the demolition of the constructed car sales company to
against Hermoso as it violated the terms and conditions of the
Deed of Sale. Trial court ruled in favor of Ortigas & Co. Mathay
raised the issue to the Court of Appeals from which he sought
favorable ruling. Hence, the instant petition.
ISSUE:
Whether or not the zoning ordinance may impair contracts
entered prior to its effectivity
HELD:
Yes. The zoning ordinance, as a valid exercise of police power
may be given effect over any standing contract. Hence,
petition is denied.
RATIO:
A law enacted in the exercise of police power to regulate or
govern certain activities or transactions could be given
retroactive effect and may reasonably impair vested rights or
contracts. Police power legislation is applicable not only to
future contracts, but equally to those already in existence.
Non-impairment of contracts or vested rights clauses will have
to yield to the superior and legitimate exercise by the State of
police power to promote the health, morals, peace, education,
good order, safety, and general welfare of the people.
Moreover, statutes in exercise of valid police power must be
read into every contract. Noteworthy, in Sangalang vs.
Intermediate Appellate Court, the Supreme Court already
upheld subject ordinance as a legitimate police power
measure.
ST. LUKES MEDICAL CENTER EMPLOYEES ASSOCIATION-AFW
v. NLRC
Maribel S. Santos was hired as X-Ray Technician in the
Radiology department of St.
Lukes Medical Center, Inc. (SLMC) on October 13, 1984.
On April 22, 1992, Congress passed and enacted Republic Act
No. 7431 known as the Radiologic Technology Act of 1992. Said
law requires that no person shall practice or offer to practice
as a radiology and/or x-ray technologist in the
Philippines without having obtained the proper certificate of
registration from the Board of Radiologic Technology.
RATIO:
While the right of workers to security of tenure is guaranteed
by the Constitution, its exercise may be reasonably regulated
pursuant to the police power of the State to safeguard health,
morals, peace, education, order, safety, and the general
welfare of the people. Consequently, persons who desire to
engage in the learned professions requiring scientific or
technical knowledge may be required to take an examination
as a prerequisite to engaging in their chosen careers. The most
concrete example of this would be in the field of medicine, the
practice of which in all its branches has been closely regulated
by the State. It has long been recognized that the regulation of
this field is a reasonable method of protecting the health and
safety of the public to protect the public from the potentially
deadly effects of incompetence and ignorance among those
who would practice medicine
GANCAYCO V. CITY GOVT. OF QUEZON CITY
FACTS:
The consolidated petitions of Retired Justice Emilio Gancayco,
City Government of Quezon City and the Metro Manila
Development Authority stemmed from a local ordinance
pertaining to Construction of Arcades, and the clearing of
Public Obstructions. Gaycanco owns a property, of which he
was able to obtain a building permit for a two-storey
commercial building.
ISSUES:
Whether or not the wing wall of Gancayco’s property can be
constituted as a public nuisance. Whether or not MMDA was
in their authority to demolish Gancayco’s property.
HELD: The court affirmed the decision of the Court of Appeals.
The court decided that the wing wall of Gancayco’s building
was not a nuisance per se, as under Art. 694 of the Civil Code
of the Philippines, nuisance is defined as any act, omission,
establishment, business, condition or property, or anything
else that (1) injures of endangers the health or safety of the
others; (2) annoys or offends the senses; (3) shocks, defies or
2
disregards decency or morality; (4) obstruct or interferes with
the free passage of any public highway or street, or any body
of water; or (5) hinders or impairs the use of property. A
nuisance may be a nuisance per se or a nuisance per accidens.
A nuisance per se are those which affect the immediate safety
of persons and property and may summarily be abated under
the undefined law of necessity. As Gaycanco was able to
procure a building permit to construct the building, it was
implied that the city engineer did not consider the building as
such of a public nuisance, or a threat to the safety of persons
and property. The MMDA was only to enforce Authoritative
power on development of Metro Manila, and was not
supposed to act with Police Power as they were not given the
authority to do such by the constitution, nor was it expressed
by the DPWH when the ordinance was enacted. Therefore,
MMDA acted on its own when it illegally demolished
Gancayco’s property, and was solely liable for the damage.
Whether there was a valid delegation of police power. Then
we can determine whether the City Government of Quezon
City acted within the limits of the delegation.
It is clear that Congress expressly granted the city government,
through the city council, police power by virtue of Section
12(oo) of Republic Act No. 537, or the Revised Charter of
Quezon City.
CITY OF BATANGAS V. PHILIPPINE SHELL PETROLEUM
Sangguniang Panlungsod enacted the Assailed Ordinance
which requires heavy industries operating along the portions
of Batangas Bay within the territorial jurisdiction of Batangas
City to construct desalination plants to facilitate the use of
seawater as coolant for their industrial facilities. 15
PSPC averred that the Assailed Ordinance constitutes an
invalid exercise of police power as it failed to meet the
substantive requirements for validity.22 Particularly, PSPC
argued that the Assailed Ordinance contravenes the Water
Code of the Philippines (Water Code), and encroaches upon
the power of the National Water
Resources Board (NWRB) to regulate and control the
Philippines' water resources. 23 In addition, Batangas City and
the Sangguniang Panlungsod failed to sufficiently show the
factual or technical basis for its enactment. 24 In this
connection, PSPC alleged that the Assailed Ordinance unduly
singles out heavy industries, and holds them solely
accountable for the loss of water and destruction of aquifers
without basis, resulting in the deprivation of their property
rights without due process of law.
The Assailed Ordinance is void for being ultra vires, for being
contrary to existing law, and for lack of evidence showing the
existence of factual basis for its enactment.
The requisites for a valid ordinance are well established. Time
and again, the Court has ruled that in order for an ordinance
to be valid, it must not only be within the corporate powers of
the concerned LGU to enact, but must also be passed in
accordance with the procedure prescribed by law. Moreover,
substantively, the ordinance (i) must not contravene the
Constitution or any statute; (ii) must not be unfair or
oppressive; (iii) must not be partial or discriminatory; (iv) must
not prohibit, but may regulate trade; (v) must be general and
consistent with public policy; and (vi) must not be
unreasonable.
Police power is the power to prescribe regulations to promote
the health, morals, peace, education, good order, safety, and
general welfare of the people. As an inherent attribute of
sovereignty, police power primarily rests with the State. In
furtherance of the State's policy to foster genuine and
meaningful local autonomy, the national legislature delegated
the exercise of police power to local government units (LGUs)
as agents of the State.72 Such delegation can be found in
Section 1673 of the LGC, which embodies the general welfare
clause. 74
Since LGUs exercise delegated police power as agents of the
State, it is incumbent upon them to act in conformity to the
will of their principal, the State.75 Necessarily, therefore,
ordinances enacted pursuant to the general welfare clause
may not subvert the State's will by contradicting national
statutes. The Assailed Ordinance effectively contravenes the
provisions of the Water Code as it arrogates unto Batangas City
the power to control and regulate the use of ground water
which, by virtue of the provisions of the Water Code, pertains
solely to the National Water Resources Board (NWRB)
DRUGSTORES ASSOCIATION OF THE PHILIPPINES v.
NATIONAL COUNCIL ON DISABILITY AFFAIRS
On March 24, 1992, Republic Act (R.A.) No. 7277, entitled "An
Act Providing for the Rehabilitation, Self-Development and
Self-Reliance of Disabled Persons and their Integration into the
Mainstream of
Society and for Other Purposes," otherwise known as the
"Magna Carta for Disabled Persons," was passed into law
W/N PWD discount is a valid exercise of police power. On the
contrary, it is an invalid exercise of the power of eminent
domain because it fails to provide just compensation to
petitioners and other similarly situated drugstores
3
The law is a legitimate exercise of police power which, similar
to the power of eminent domain, has general welfare for its
object. Police power is not capable of an exact definition, but
has been purposely veiled in general terms to underscore its
comprehensiveness to meet all exigencies and provide enough
room for an efficient and flexible response to conditions and
circumstances, thus assuring the greatest benefits. R.A. No.
7277 was enacted primarily to provide full support to the
improvement of the total well-being of PWDs and their
integration into the mainstream of society.
The PWD mandatory discount on the purchase of medicine is
supported by a valid objective or purpose as aforementioned.
It has a valid subject considering that the concept of public use
is no longer confined to the traditional notion of use by the
public, but held synonymous with public interest, public
benefit, public welfare, and public convenience. As in the case
of senior citizens, the discount privilege to which the PWDs are
entitled is actually a benefit enjoyed by the general public to
which these citizens belong. The means employed in invoking
the active participation of the private sector, in order to
achieve the purpose or objective of the law, is reasonably and
directly related. Also, the means employed to provide a fair,
just and quality health care to PWDs are reasonably related to
its accomplishment, and are not oppressive, considering that
as a form of reimbursement, the discount extended to PWDs
in the purchase of medicine can be claimed by the
establishments as allowable tax deductions pursuant to
Section 32 of R.A. No. 9442 as implemented in Section 4 of DOF
Revenue Regulations No. 1-2009. Otherwise stated, the
discount reduces taxable income upon which the tax liability
of the establishments is computed.
AGAN V. PIATCO
Seeking to prohibit the Manila International Airport Authority
(MIAA) and the Department of Transportation and
Communications (DOTC) and its Secretary from implementing
the following agreements executed by the Philippine
Government through the DOTC and the MIAA and the
Philippine International Air Terminals Co., Inc. (PIATCO):
The above provision pertains to the right of the State in times
of national emergency, and in the exercise of its police power,
to temporarily take over the operation of any business
affected with public interest. In the 1986 Constitutional
Commission, the term national emergency was defined to
include threat from external aggression, calamities or national
disasters, but not strikes unless it is of such proportion that
would paralyze government service.[60] The duration of the
emergency itself is the determining factor as to how long the
temporary takeover by the government would last.[61] The
temporary takeover by the government extends only to the
operation of the business and not to the ownership thereof. As
such the government is not required to compensate the
private entity-owner of the said business as there is no transfer
of ownership, whether permanent or temporary. The private
entity-owner affected by the temporary takeover cannot,
likewise, claim just compensation for the use of the said
business and its properties as the temporary takeover by the
government is in exercise of its police power and not of its
power of eminent domain.
PIATCO cannot, by mere contractual stipulation, contravene
the Constitutional provision on temporary government
takeover and obligate the government to pay reasonable cost
for the use of the Terminal and/or
Terminal Complex.[63] Article XII, section 17 of the 1987
Constitution envisions a situation wherein the exigencies of
the times necessitate the government to temporarily take over
or direct the operation of any privately owned public utility or
business affected with public interest. It is the welfare and
interest of the public which is the paramount consideration in
determining whether or not to temporarily take over a
particular business. Clearly, the State in effecting the
temporary takeover is exercising its police power. Police
power is the most essential, insistent, and illimitable of
powers. [64] Its exercise therefore must not be unreasonably
hampered nor its exercise be a source of obligation by the
government in the absence of damage due to arbitrariness of
its exercise.[65] Thus, requiring the government to pay
reasonable compensation for the reasonable use of the
property pursuant to the operation of the business
contravenes the Constitution.
NATIONAL POWER CORP. V. POSADA
The National Power Corporation instituted expropriation
proceedings for the acquisition of a right-of-way easement
over parcels of land located in Barangay Marinawa, Bato,
Catanduanes owned by respondents Socorro T. Posada,
Renato Bueno, Alice Balin, Adrian Tablizo, Teofilo Tablizo, and
Lydia Tablizo.4 The expropriation w.as for the construction and
maintenance of its Substation Island Grid Project.5 The case
was docketed as Civil Case No. 0008.6 The National Power
Corporation offered the, price of P500.00 per square meter. In
their Answer, respondents objected to the offer and alleged
that the value of the properties was P2, 000.00 per square
meter.
There are two (2) stages in every action for expropriation. The
first is concerned with the determination of the authority of
the plaintiff to exercise the power of eminent domain and the
4
propriety of its exercise in the context of the facts involved in
the suit. It ends with an order, if not of dismissal of the action,
"of condemnation declaring, that the plaintiff has a lawful right
to take the property sought to be condemned, 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
filing of the complaint."
The second phase of the eminent domain action is concerned
with the determination by the Court of "the just compensation
for the property sought to be taken.” This is done by the Court
with the assistance of not more than three (3) commissioners.
The order fixing the just compensation on the basis of the
evidence before, and findings of, the commissioners would be
final, too. It would finally dispose of the second stage of the
suit, and leave nothing more to be done by the Court regarding
the issue. Obviously, one or another of the parties may believe
the order to be erroneous in its appreciation of the evidence
or findings of fact or otherwise. Obviously, too, such a
dissatisfied party may seek a reversal of the order by taking an
appeal therefrom.
Expropriation proceedings must be dismissed when it is
determined that it is not for a public purpose, except when:
First, the trial court's order already became final and
executory;
Second, the government already took possession of the
property; and
Lastly, the expropriation case already caused prejudice to the
landowner.
BIGLANG AWA V. BACALLA
Remedios Biglang-awa received a Notice from the respondent
Republic, through the Department of Public Works and
Highways (DPWH) Project Manager Patrick G. Gatan, requiring
her to submit the documents necessary to determine the just
compensation for her property. Subsequently, the respondent
Republic, through the DPWH, deposited with the Land Bank of
the Philippines the amounts of P3, 964,500.00 and P2,
511,000.00 for the properties of Salvador and Remedios
Biglang-awa, respectively, based on the appraisal report of the
Quezon City Appraisal Committee.
Expropriation proceedings are governed by revised Rule 67
of the 1997 Rules of Civil Procedure which took effect on
July 1, 1997. Previous doctrines inconsistent with this Rule
are deemed reversed or modified. Specifically, (1) an answer,
not a motion to dismiss, is the responsive pleading to a
complaint in eminent domain; (2) the trial court may issue a
writ of possession once the plaintiff deposits an amount
 equivalent to the assessed value of the property, pursuant
to Section 2 of said Rule, without need of a hearing to
determine the provisional sum to be deposited; and (3) a
final order of expropriation may not be issued prior to a full
hearing and resolution of the objections and defenses of the
property owner.(Emphasis Ours)
Thus, pursuant to Section 2 of Rule 67 of the 1997
Revised Rules of Civil Procedure and the Robern Development
Corporation case, the only requisites for authorizing
immediate entry in expropriation proceedings are: (1) the
filing of a complaint for expropriation sufficient in form and
substance; and (2) the making of a deposit equivalent to the
assessed value of the property subject to expropriation. Upon
compliance with the requirements the issuance of the writ of
possession becomes ministerial.
The issuance of a writ of possession pursuant to Rule 67 of
the 1997 Revised Rules of Civil Procedure alone is neither
capricious nor oppressive, as the said rule affords owners
safeguards against unlawful deprivation of their property in
expropriation proceedings, one of which is the deposit
requirement which constitutes advance payment in the event
expropriation proceeds, and stands as indemnity for damages
should the proceedings fail of consummation.[11] The
deposit likewise sufficiently satisfies the compensation
requirement of the Constitution.[12] Moreover, the owners
of the expropriated lands are entitled to legal interest on the
compensation eventually adjudged from the date the
condemnor takes possession of the land until the full
compensation is paid to them or deposited in court
SUGUITAN V. CITY OF MANDALUYONG
On October 13, 1994, the Sangguniang Panlungsod of
Mandaluyong City issued Resolution No. 396, S-1994[3]
authorizing then Mayor Benjamin S. Abalos to institute
expropriation proceedings over the property of Alberto Sugui
located at Boni Avenue and Sto. Rosario streets in
Mandaluyong City. The intended purpose of the expropriation
was the expansion of the Mandaluyong Medical Center.
The power of eminent domain is essentially legislative in
nature. It is firmly settled, however, that such power may be
validly delegated to local government units, other public
entities and public utilities, although the scope of this
delegated legislative power is necessarily narrower than that
of the delegating authority and may only be exercised in strict
compliance with the terms of the delegating law.
Despite the existence of this legislative grant in favor of local
governments, it is still the duty of the courts to determine
whether the power of eminent domain is being exercised in
5
accordance with the delegating law.[23] In fact, the courts
have adopted a more censorious attitude in resolving
questions involving the proper exercise of this delegated
power by local bodies, as compared to instances when it is
directly exercised by the national legislature.[24]
The courts have the obligation to determine whether the
following requisites have been complied with by the local
government unit concerned:
1. An ordinance is enacted by the local legislative council
authorizing the local chief executive, in behalf of the local
government unit, to exercise the power of eminent domain or
pursue expropriation proceedings over a particular private
property .calr
2. The power of eminent domain is exercised for public use,
purpose or welfare, or for the benefit of the poor and the
landless.
3. There is payment of just compensation, as required under
Section 9, Article III of the Constitution, and other pertinent
laws.
4. A valid and definite offer has been previously made to the
owner of the property sought to be expropriated, but said
offer was not accepted
In the present case, the City of Mandaluyong seeks to exercise
the power of eminent domain over petitioners' property by
means of a resolution, in contravention of the first requisite.
The law in this case is clear and free from ambiguity. Section
19 of the Code requires an ordinance, not a resolution, for the
exercise of the power of eminent domain
JESUS IS LORD CHRISTIAN SCHOOL FOUNDATION, INC.,
petitioner, vs. MUNICIPALITY (now CITY) OF PASIG, METRO
MANILA
The Municipality of Pasig needed an access road from E. R.
Santos Street, a municipal road near the Pasig Public Market,
to Barangay Sto. Tomas Bukid, Pasig, where 60 to 70 houses,
mostly made of light materials, were located. The road had to
be at least three meters in width, as required by the Fire Code,
so that fire trucks could pass through in case of
conflagration.[2] Likewise, the residents in the area needed
the road for water and electrical outlets.[3] The municipality
then decided to acquire 51 square meters out of the 1,791-
square meter property of Lorenzo Ching Cuanco, Victor Ching
Cuanco and Ernesto Ching Cuanco Kho] which is abutting E. R.
Santos Street.
On April 19, 1993, the Sangguniang Bayan of Pasig approved
an Ordinance [5] authorizing the municipal mayor to initiate
expropriation proceedings to acquire the said property and
appropriate the fund therefor. The ordinance stated that the
property owners were notified of the municipality’s intent to
purchase the property for public use as an access road but they
rejected the offer.
There is no showing in the record that an ocular inspection was
conducted during the trial. If, at all, the trial court conducted
an ocular inspection of the subject property during the trial,
the petitioner was not notified thereof. The petitioner was,
therefore, deprived of its right to due process. It bears
stressing that an ocular inspection is part of the trial as
evidence is thereby received and the parties are entitled to be
present at any stage of the trial. Consequently, where, as in
this case, the petitioner was not notified of any ocular
inspection of the property, any factual finding of the court
based on the said inspection has no probative weight.
the power of eminent domain is not inherent in LGU and must
be expressly provided for by statute
MASIKIP V. CITY OF PASIG
FACTS:
Lourdes Dela Paz Masikip is the registered owner of a parcel of
land, which the City of Pasig sought to expropriate a portion
thereof for the “sports development and recreational
activities” of the residents of Barangay Caniogan. This was in
January 1994. Masikip refused.
On March 23, 1994, City of Pasig sought again to expropriate
said portion of land for the alleged purpose that it was “in line
with the program of the Municipal Government to provide
land opportunities to deserving poor sectors of our
community.”
Petitioner protested, so City of Pasig filed with the trial court a
complaint for expropriation. The Motion to Dismiss filed by
Masikip was dismissed by the rial court on the ground that
there was genuine necessity to expropriate the property. Case
was elevated to the Court of Appeals, which dismissed petition
for lack of merit.
ISSUE:
W/N there was genuine necessity to expropriate the property
HELD:
Eminent domain is “the right of a government to take and
appropriate private property to the public use, whenever the
public exigency requires it, which can be done only on
condition of providing a reasonably compensation therefor.” It
is the power of the State or its instrumentalities to take private
6
property for public use and is inseparable from sovereignty
and inherent in government.
This power is lodged in the legislative branch of government.
It delegates the power thereof to the LGUs, other public
entities and public utility corporations, subject only to
constitutional limitations. LGUs have no inherent power of
eminent domain and may exercise it only when expressly
authorized by statute.
Sec. 19, LGC: LGU may, through its chief executive and acting
pursuant to an ordinance, exercise the power of eminent
domain for public use, purpose or welfare for the benefit of
the poor and landless, upon payment of just compensation,
pursuant to the provisions of the Constitution and pertinent
laws. Provided:
(1) 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;
(2) LGU may immediately take possession of the property upon
the filing of expropriation proceedings and upon making a
deposit with the proper court of at least 15% fair market value
of the property based on the current tax declaration; and
(3) amount to be paid for expropriated property shall be
determined by the proper court, based on the fair market
value at the time of the taking of the property
There is already an established sports development and
recreational activity center at Rainforest Park in Pasig City.
Evidently, there is no “genuine necessity” to justify the
expropriation. The records show that the Certification issued
by the Caniogan Barangay Council which became the basis for
the passage of Ordinance No. 4, authorizing the expropriation,
indicates that the intended beneficiary is the Melendres
Compound Homeowner’s Association, a private, non-profit
organization, not the residents of Caniogan.
City of Manila vs Chinese Community of Manila, GR 14355
(1D), 31 October 1919
FACTS: Petitioner (City of Manila) filed a petition praying that
certain lands be expropriated for the purpose of constructing
a public improvement namely, the extension of Rizal Avenue,
Manila and claiming that such expropriation was necessary.
Herein defendants, on the other hand, alleged (a) that no
necessity existed for said expropriation and (b) that the land in
question was a cemetery, which had been used as such for
many years, and was covered with sepulchres and
monuments, and that the same should not be converted into
a street for public purposes.
HELD: Yes. The very foundation of the right to exercise
eminent domain is a genuine necessity, and that necessity
must be of a public character. The ascertainment of the
necessity must precede or accompany, and not follow, the
taking of the land. (Morrison vs. Indianapolis, etc. Ry. Co., 166
Ind., 511; Stearns vs. Barre, 73 Vt., 281; Wheeling, etc. R. R. Co.
vs. Toledo, Ry. etc. Co., 72 Ohio St., 368.)
The general power to exercise the right of eminent domain
must not be confused with the right to exercise it in a particular
case. The power of the legislature to confer, upon municipal
corporations and other entities within the State, general
authority to exercise the right of eminent domain cannot be
questioned by the courts, but that general authority of
municipalities or entities must not be confused with the right
to exercise it in particular instances. 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 the municipal corporation or
entity is exercising the right in a particular case under the
conditions imposed by the general authority, is a question
which the courts have the right to inquire into.
The conflict in the authorities upon the question whether the
necessity for the exercise of the right of eminent domain is
purely legislative and not judicial, arises generally in the
wisdom and propriety of the legislature in authorizing the
exercise of the right of eminent domain instead of in the
question of the right to exercise it in a particular case. (Creston
Waterworks Co. vs. McGrath, 89 Iowa, 502.)
By the weight of authorities, 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.
Ansaldo vs. Tantuico
Facts: Two lots of private ownership were taken by the
Government and used for the widening of a road more than
forty-three years ago, without benefit of an action of eminent
domain or agreement with its owners, albeit without protest
by the latter. The lots belong to the petitioners, Jose Ma.
Ansaldo and Maria Angela Ansaldo, are covered by title in their
names and have an aggregate area of 1,041 square meters.
These lots were taken from the Ansaldos sometime in 1947 by
the Department of Public Work Transportation and
Communication and made part of what used to be Sta. Mesa
Street and is now Ramon Magsaysay Avenue at San Juan,
Metro Manila.Said owners made no move whatever until
7
twenty-six years later. They wrote to ask for compensation for
their land on January 22, 1973. 2 Their claim was referred to
the Secretary of Justice who in due course rendered an opinion
dated February 22, 1973, 3 that just compensation should be
paid in accordance with Presidential Decree No. 76. The
Commission on Audit, however, declined to adopt the
recommendation. In a decision handed down on September
26, 1973. The Acting Chairman ruled that "the amount of
compensation to be paid to the claimants is to be determined
as of the time of the taking of the subject lots.
Issue: whether or not just compensation should be fixed as of
the time of actual taking of possession by the expropriating
entity or only after conveyance of title to the expropriator
pursuant to expropriation proceedings duly instituted
Held: In the context of the State's inherent power of eminent
domain, there is a "taking" when the owner is actually
deprived or dispossessed of his property; when there is a
practical destruction or a material impairment of the value of
his property or when he is deprived of the ordinary use
thereof. 12 There is a "taking" in this sense when the
expropriator enters private property not only for a momentary
period but for a more permanent duration, for the purpose of
devoting the property to a public use in such a manner as to
oust the owner and deprive him of all beneficial enjoyment
thereof. Clearly, then, the value of the Ansaldos' property
must be ascertained as of the year 1947, when it was actually
taken, and not at the time of the filing of the expropriation suit,
which, by the way, still has to be done. The value, once fixed,
shall earn interest at the legal rate until full payment is
effected, conformably with other principles laid down by case
law.
REPUBLIC VS. VDA. DE CASTELLVI
FACTS: After the owner of a parcel of land that has been
rented and occupied by the government in 1947 refused to
extend the lease, the latter commenced expropriation
proceedings in 1959. During the assessment of just
compensation, the government argued that it had taken the
property when the contract of lease commenced and not
when the proceedings begun. The owner maintains that the
disputed land was not taken when the government
commenced to occupy the said land as lessee because the
essential elements of the “taking” of property under the power
of eminent domain, namely (1) entrance and occupation by
condemnor upon the private property for more than a
momentary period, and (2) devoting it to a public use in such
a way as to oust the owner and deprive him of all beneficial
enjoyment of the property, are not present.
ISSUE: Whether or not the taking of property has taken place
when the condemnor has entered and occupied the property
as lesse.
HELD: No, the property was deemed taken only when the
expropriation proceedings commenced in 1959.
The essential elements of the taking are: (1) Expropriator must
enter a private property, (2) for more than a momentary
period, (3) and under warrant of legal authority, (4) devoting it
to public use, or otherwise informally appropriating or
injuriously affecting it in such a way as (5) substantially to oust
the owner and deprive him of all beneficial enjoyment thereof.
In the case at bar, these elements were not present when the
government entered and occupied the property under a
contract of lease.
NATIONAL POWER CORPORATION v. SPS. MARGARITO
ASOQUE & TARCINIA ASOQUE
The National Power Corporation entered the Spouses
Asoque's land to install transmission lines for its 350 KV Leyte-
Luzon HVDC Power Transmission Line Project.[8] The National
Power Corporation utilized 4,352 square meters for the
project.
Spouses Asoque allege that beforehand, they were made to
understand that the National Power Corporation would pay
them the value of the portion of the land used and all
improvements that would be destroyed for the National Power
Corporation's project.[10] Spouses Asoque incurred actual
damages as a result of the National Power Corporation's
cutting off some coconut trees and other fruit- and non-fruit-
bearing plants during the construction.[11] They were also
prohibited from introducing on the 4,352-square-meter area
any improvement that could rise by a few meters from the
ground.
Upon Spouses Asoque's demand for just compensation, the
National Power Corporation only paid for the improvements
destroyed and refused to pay for the actual value of the 4,352-
square-meter area utilized for the project.[13] The National
Power Corporation claimed that it was only liable to pay for
right of way at 10% of the market value under Section 3-A of
Republic Act No. 6395
Petitioner is liable to pay respondents just compensation and
not merely an easement fee on the basis that its acquisition of
a right-of-way easement over the portion of respondents' land
was a taking under the power of eminent domain.
8
While expropriation normally involves a taking of title to and
possession of the property, an easement of right of way on a
private property can be considered a taking under eminent
domain under certain conditions.
While expropriation normally involves a taking of title to and
possession of the property, an easement of right of way on a
private property can be considered a taking under eminent
domain under certain conditions. In Republic v. PLDT:[81]
Normally, of course, the power of eminent domain results in
the taking or appropriation of title to, and possession of, the
expropriated property; but no cogent reason appears why the
said power may not be availed of to impose only a burden
upon the owner of condemned property, without loss of title
and possession. It is unquestionable that real property may,
through expropriation, be subjected to an easement of right
of way.[82]
There is taking in the context of the state's power of
eminent domain when the following elements are present:
(1) The expropriator enters a private property;
The entrance into the private property is indefinite or
(2)
permanent;
There is color of legal authority in the entry into the
(3)
property;
(4) The property is devoted to public use or purpose; and
The use of property for public use removed from the
(5)
owner all beneficial enjoyment of the property.[83]
A right-of-way easement or burden becomes a "taking" under
eminent domain when there is material impairment of the
value of the property or prevention of the ordinary uses of the
property for an indefinite period. The intrusion into the
property must be so immediate and direct as to subtract from
the owner's full enjoyment of the property and to limit his or
her exploitation of it.
HEIRS OF JUANCHO ARDONA VS REYES
FACTS : The Philippine Tourism Authority filed four (4)
Complaints with the Court of First Instance of Cebu City for the
expropriation of some 282 hectares of rolling land situated in
barangays Malubog and Babag, Cebu City, under PTA's express
authority "to acquire by purchase, by negotiation or by
condemnation proceedings any private land within and
without the tourist zones" for the purposes indicated in
Section 5, paragraph B(2), of its Revised Charter (PD 564),
more specifically, for the development into integrated resort
complexes of selected and well-defined geographic areas with
potential tourism value
The petitioners' contention that the promotion of tourism is
not "public use" because private concessioners would be
allowed to maintain various facilities such as restaurants,
hotels, stores, etc. inside the tourist complex is impressed with
even less merit. Private bus firms, taxicab fleets, roadside
restaurants, and other private businesses using public streets
and highways do not diminish in the least bit the public
character of expropriations for roads and streets. The lease of
store spaces in underpasses of streets built on expropriated
land does not make the taking for a private purpose. Airports
and piers catering exclusively to private airlines and shipping
companies are still for public use. The expropriation of private
land for slum clearance and urban development is for a public
purpose even if the developed area is later sold to private
homeowners, commercial firms, entertainment and service
companies, and other private concerns
The public respondents have stressed that the development of
the 808 hectares includes plans that would give the petitioners
and other displaced persons productive employment, higher
incomes, decent housing, water and electric facilities, and
better living standards. Our dismissing this petition is, in part,
predicated on those assurances. The right of the PTA to
proceed with the expropriation of the 282 hectares already
Identified as fit for the establishment of a resort complex to
promote tourism is, therefore, sustained.
REPUBLIC VS HEIRS OF BORBON
FACTS:
The National Power Corporation (NAPOCOR) entered into a
private property owned by respondents Borbon in order to
construct and maintain transmission lines for its Power
Transmission Project. NAPOCOR then filed for expropriation
of an easement of right of way over a portion of the
said property. However, during the pendency of the appeal,
NAPOCOR filed a motion to discontinue the expropriation
proceedings, that the property sought to be expropriated was
no longer necessary for public purpose, that because the
public purpose ceased to exist, the proceedings for
expropriation should no longer continue, and the State was
now duty-bound to return the property to its owners; and
that the dismissal or discontinuance of the expropriation
proceedings was in accordance of the Rules of Court.
ISSUE:
Whether the expropriation proceedings should be
discontinued or dismissed pending appeal.
HELD:
9
The dismissal of the proceedings for expropriation at the
instance of NAPOCOR is proper, but, the dismissal or
discontinuance of the proceedings must be upon such terms
as the court deems just and equitable. Here, NAPOCOR seeks
to discontinue the expropriation proceedings on the ground
that the transmission lines constructed on the respondents’
property had already been retired. The retirement of the
transmission lines necessarily stripped the expropriation
proceedings of the element of public use. Accordingly, the
Court grants the motion to discontinue the proceedings and
requires the return of the property to the respondents.
In view of the discontinuance of the proceedings and the
eventual return of the property to the
respondents, NAPOCOR should compensate the
respondents for the disturbance of their property rights
from the time of entry in March 1993 until the time of
restoration of the possession by paying actual or other
compensatory damages. The compensation must be based
on what they actually lost as a result and by reason of their
dispossession of the property and of its use, including the
value of the fruit trees, plants and crops destroyed by
NAPOCOR’s construction of the transmission
lines.Considering that the dismissal of the expropriation
proceedings is a development occurring during the appeal,
the Court treats the dismissal of the expropriation
proceedings as producing the effect of converting the case
into an action for damages.
SINDALAN V. CA
On April 8, 1983, pursuant to a resolution passed by the
barangay council, petitioner Barangay Sindalan, San Fernando,
Pampanga filed a Complaint for eminent domain against
respondent’s spouses Jose Magtoto III and Patricia Sindayan,
the registered owners of a parcel of land Petitioner sought to
convert a portion of respondents land into Barangay Sindalans
feeder road. The alleged public purposes sought to be served
by the expropriation were stated in Barangay Resolution No. 6
Respondents alleged that the expropriation of their property
was for private use, that is, for the benefit of the homeowners
of Davsan II Subdivision. They contended that petitioner
deliberately omitted the name of Davsan II Subdivision and,
instead, stated that the expropriation was for the benefit of
the residents of Sitio Paraiso in order to conceal the fact that
the access road being proposed to be built across the
respondents land was to serve a privately owned subdivision
and those who would purchase the lots of said subdivision.
They also pointed out that under Presidential Decree No. (PD)
957, it is the subdivision owner who is obliged to provide a
feeder road to the subdivision residents
Considering that the residents who need a feeder road are all
subdivision lot owners, it is the obligation of the Davsan II
Subdivision owner to acquire a right-of-way for them.
However, the failure of the subdivision owner to provide an
access road does not shift the burden to petitioner. To deprive
respondents of their property instead of compelling the
subdivision owner to comply with his obligation under the law
is an abuse of the power of eminent domain and is patently
illegal. Without doubt, expropriation cannot be justified on the
basis of an unlawful purpose.
Thirdly, public funds can be used only for a public purpose. In
this proposed condemnation, government funds would be
employed for the benefit of a private individual without any
legal mooring. In criminal law, this would constitute
malversation. Respondents must be granted the opportunity
to show that their lot is not a servient estate. Plainly,
petitioners resort to expropriation is an improper cause of
action.
One last word: the power of eminent domain can only be
exercised for public use and with just compensation. Taking an
individual’s private property is a deprivation which can only be
justified by a higher goodwhich is public useand can only be
counterbalanced by just compensation. Without these
safeguards, the taking of property would not only be unlawful,
immoral, and null and void, but would also constitute a gross
and condemnable transgression of an individual’s basic right
to property as well.
Facts: Plaintiff a municipal corporation filed a complaint
for declaratory relief against defendant a
publiccorporation, created under Act.1383. It contends
that the said act does not include within its purview
theBaguio Water Works system, assuming that it does,
is unconstitutional because it deprives the
plaintiff ownership, control and operation of said water
works without just compensation and due process of
law.The defendant filed a motion to dismiss on the
ground that RA 1383 is a proper exercise of police
power and eminent domain of the State. The court
denied the motion and ordered the defendants to file
ananswer. The court holds that the water works system
of Baguio belongs to the category of private property
and cannot be expropriated without just compensation
and that
Sec. 8 of R.A.1383 provides for the exchange of the
NAWASA assets for the value of the water works system
of Baguio is unconstitutional for this is not just
10
compensation. Defendant’s motion for reconsideration
was deniedhence this appeal
.Issues: Whether or Not there is a valid exercise of (1)
police power and (2) eminent domain
Held: (1 and 2)No. Republic Act No. 1383 does not
constitute a valid exercise of police power. The Actdoes
not confiscate, nor destroy, nor appropriate property
belonging to appellee. It merely directs that
allwaterworks belonging to cities, municipalities and
municipal districts in the Philippines be transferred
tothe NAWASA for the purpose of placing them under
the control and supervision of one agency with aview to
promoting their efficient management, but in so doing
it does not confiscate them because itdirects that they
be paid with an equal value of the assets of the
NAWASA.Wherefore, the decision appealed from is
affirmed, without pronouncement as to costs.
Section 6, Article XIII of our Constitution provides:
"SEC. 6.The State may, in the interest of National
Welfare anddefense, establish and operate industries
and means of transportation andcommunication, and,
upon payment of just compensation, transfer to public
ownership utilities and other private enterprises to be
operated bythe Government."
Section 1 (2), Article III, of our Constitution provides:
"(2)Private property shall not be taken for public
use without justcompensation".
ASSOCIATION OF SMALL LANDOWNERS VS SEC. OF
AGRARIAN REFORM
FACTS:
The following are consolidated cases:
A petition alleging the constitutionality of PD No. 27,
EO 228 and 229 and RA 6657. Subjects of the petition
are a 9-hectare and 5 hectare Riceland worked by four
tenants. Tenants were declared full owners by EO 228
as qualified farmers under PD 27. The petitioners now
contend that President Aquino usurped the
legislature‘s power.
A petition by landowners and sugar planters in
Victoria‘s Mill Negros Occidental against Proclamation
131 and EO 229. Proclamation 131 is the creation of
Agrarian Reform Fund with initial fund of P50Billion.
A petition by owners of land which was placed by the
DAR under the coverage of Operation Land Transfer.
A petition invoking the right of retention under PD 27
to owners of rice and corn lands not exceeding seven
hectares.
ISSUE:
Whether the aforementioned EO‘s, PD, and RA were
constitutional.
HELD:
The promulgation of PD 27 by President Marcos was
valid in exercise of Police power and eminent domain.
The power of President Aquino to promulgate Proc.
131 and EO 228 and 229 was authorized under Sec. 6
of the Transitory Provisions of the 1987 Constitution.
Therefore it is a valid exercise of Police Power and
Eminent Domain
RA 6657 is likewise valid. The carrying out of the
regulation under CARP becomes necessary to deprive
owners of whatever lands they may own in excess of
the maximum area allowed, there is definitely a taking
under the power of eminent domain for which
payment of just compensation is imperative. The
taking contemplated is not a mere limitation of the use
of the land. What is required is the surrender of the
title and the physical possession of said excess and all
beneficial rights accruing to the owner in favour of the
farmer-beneficiary.
The Court declares that the content and manner of the
just compensation provided for in Section 18 of the
CARP Law is not violative of the Constitution.
Lagcao vs. Labra
FACTS:
After acquiring title, petitioners tried to take possession
of the lot only to discover that it was already occupied
by squatters. Thus a demolition order was issued.
However, when the demolition order was about to be
11
implemented, Cebu City Mayor Alvin Garcia wrote two
letters] to the MTCC, requesting the deferment of the
demolition on the ground that the City was still looking
for a relocation site for the squatters. Acting on the
mayors request, the MTCC issued two orders
suspending the demolition for a period of 120 days.
Unfortunately for Petitioners, during the suspension
period, the Sangguniang Panlungsod (SP) of Cebu City
passed a resolution which identified Lot 1029 as a
socialized housing site pursuant to RA 7279.
In this appeal, petitioners argue that Ordinance No.
1843 is unconstitutional as it sanctions the
expropriation of their property for the purpose of
selling it to the squatters, an endeavor contrary to the
concept of public use contemplated in the Constitution.
They allege that it will benefit only a handful of people.
ISSUE:
What is Eminent Domain? Was this validly exercised in
this case?
RULING:
It is where 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.
No, it has not been validly invoked in this case due to
the fact that The foundation of the right to exercise
eminent domain should be a genuine necessity and that
necessity must be of public character. Government may
not capriciously or arbitrarily choose which private
property should be expropriated. In this case, there was
no showing at all why petitioners property was singled
out for expropriation by the city ordinance or what
necessity impelled the particular choice or selection.
Ordinance No. 1843 stated no reason for the choice of
petitioners property as the site of a socialized housing
project.
It should also be noted that, as early as 1998, petitioners
had already obtained a favorable judgment of eviction
against the illegal occupants of their property but
Mayor Garcia requested the trial court to suspend the
demolition on the pretext that the City was still
searching for a relocation site for the squatters.
However, instead of looking for a relocation site during
the suspension period, the city council suddenly
enacted Ordinance No. 1843 for the expropriation of
petitioners lot. It was trickery and bad faith, pure and
simple. The unconscionable manner in which the
questioned ordinance was passed clearly indicated that
respondent City transgressed the Constitution, RA 7160
and RA 7279.
FELISA AGRICULTURAL CORP V. NATL TRANSMISSION
CORP
The instant case stemmed from a Complaint6 for
recovery of possession with damages or payment
of just compensation dated January 9, 2001 filed
by petitioner Felisa Agricultural Corporation
(petitioner) against NPC before the RTC,
docketed as Civil Case No. 01-11356. Petitioner
claimed that in 1997, it discovered that the NPC's
transmission towers and transmission lines were
located within a 19,635-square meter (sq. m.)
portion (subject land) of its lands situated in
Brgy. Felisa, Bacolod City. Further verification
revealed that the transmission towers were
constructed sometime before 1985 by NPC which
entered the subject land without its knowledge
and consent.7
For its part,8 NPC denied having entered the
subject land without any authority, and claimed
that petitioner's President, Jovito Sayson,
granted it the permit to enter9 on September 21,
1989 for the construction of the 138 KV Mabinay-
Bacolod Transmission Line. It further countered
that since the transmission lines have been in
existence for more than ten (10) years, a
continuous easement of right of way has already
been established. Considering, however, that the
action was brought beyond the five-year
prescriptive period to do so in accordance with
the NPC Charter, the claim is barred by
prescription.10
In the course of the proceedings, the parties
agreed to narrow down the issue to the payment
of just compensation and agreed to settle the
12
case at the price of P400.00/sq. m. but the
proposed compromise did not push through in
view of the failure of the Office of the Solicitor
General (OSG) to act on the Deed of Sale entered
into by the parties.11 Subsequently, petitioner
moved that NPC be immediately ordered to pay
the amount of P7,845,000.0012 representing the
100% zonal value of the subject land13 in
accordance with Republic Act No. (RA)
8974.14 NPC opposed the motion, contending that
the said law only applies to expropriation cases
initiated by the government to acquire property
for any national government infrastructure
project.15
It must be emphasized that RA 8974 does not
take away from the courts the power to judicially
determine the amount of just compensation. It
merely provides relevant standards in order to
facilitate the determination of just compensation,
and sets the minimum price of the property as
the provisional value62 to immediately
recompense the landowner with the same degree
of speed as the taking of the property, which
reconciles the inherent unease attending
expropriation proceedings with a position of
fundamental equity.63
Nonetheless, it is settled that where actual taking
was made without the benefit of expropriation
proceedings, and the owner sought recovery of
the possession of the property prior to the filing
of expropriation proceedings, the Court has
invariably ruled that it is the value of the property
at the time of taking that is controlling for
purposes of compensation.64 Any other
interpretation would be repugnant to the
Constitution which commands the exproriator to
pay the property owner no less than the full and
fair equivalent of the property from the date of
taking.65
The reason for the rule, as pointed out in Republic
v. Lara,66 is that:
[W]here property is taken ahead of the filing of
the condemnation proceedings, the value thereof
may be enchanced by the public purpose for
which it is taken; the entry by the plaintiff upon
the property may have depreciated its value
thereby; or, there may have been a natural
increase in the value of the property from the
time the complaint is filed, due to general
economic conditions. The owner of private
property should be compensated only for what he
actually loses; it is not intended that his
compensation shall extend beyond his loss or
injury. And what he loses is only the actual value
of his property at the time it is taken. This is the
only way that compensation to be paid can be
truly just; i.e., "just not only to the individual
whose property is taken," "but to the public,
which is to pay for it." 67

However, it must be emphasized that in

determining just compensation, the courts must
consider and apply the parameters set by the law
and its implementing rules and regulations in
order to ensure that they do not arbitrarily fix an
amount as just compensation that is
contradictory to the objectives of the law. Be that
as it may, when acting within such parameters,
courts are not strictly bound to apply the same to
its minutest detail, particularly when faced with
situations that do not warrant its strict
application. Thus, the courts may, in the
exercise of their discretion, relax the
application of the guidelines subject to the
jurisprudential limitation that the factual
situation calls for it and the courts clearly
explain the reason for such deviation.6

13