SECOND DIVISION
G.R. No. 212786, July 30, 2018
REPUBLIC OF THE PHILIPPINES, REPRESENTED BY THE DEPARTMENT OF PUBLIC WORKS AND HIGHWAYS (DPWH), Petitioner, v. ESTRELLA R. DECENA, MARIETA DECENA BRAZIL, NOLAND D. BRAZIL, HEIRS OF EDITA R. DECENA, AS REPRESENTED BY VIRGILIO C. BRAZIL, SR., Respondents.
D E C I S I O N
CAGUIOA, J.:
This is a petition for review on certiorari1 (Petition) under Rule 45 of the Rules of Court filed by the Petitioner Republic of the Philippines, represented by the Department of Public Works and Highways (DPWH), through the Office of the Solicitor General (OSG), against herein Respondents Estrella R. Decena, Marieta D. Brazil, Noland D. Brazil, and Heirs of Edita R. Decena, all represented by Virgilio C. Brazil, Sr., assailing the Court of Appeals' (CA) Decision2 dated February 28, 2014 and Resolution3 dated May 28, 2014 in CA-G.R. CV No. 100485.4
In the assailed rulings, the CA affirmed in toto the Resolution5 of the Regional Trial Court of Quezon City, Branch 83 (RTC) dated July 5, 2012 in Civil Cases Nos. Q-10-68298, Q-10-68299, Q-10-68390, Q-10-68731, and Q-10-68732, in which the RTC determined and fixed the just compensation at Twenty-Five Thousand Pesos (P25,000.00) per square meter for Respondents' expropriated property.6
On June 17, 2011, the RTC issued a Writ of Possession ordering the sheriff to place the Petitioner in possession of the property.14
Amount deposited with LBP Owner P1,428,000.00 Estrella Decena P3,668,000.00 Marieta Decena-Brazil P4,410,000.00 Nolan Decena-Brazil P3,346,000.00 and P1,554,000.00 Edita Brazil13
WHEREFORE, in view of the foregoing existing rule, an ORDER OF CONDEMNATION is hereby issued declaring that the plaintiff, Republic of the Philippines, represented by the Department of Public Works and Highways, has a lawful right to take the subject parcels of land more specifically covered by Transfer Certificate of Title Nos. RT-127975 (352132), 004-201000207, N-310774, 004-RT2010010365 (352129) and RT-128458 (352131) registered in the names of the above-named defendants at the Registry of Deeds for Quezon City for public use or purpose as stated in the Complaints, upon payment of just compensation.The BOC valuation
Accordingly, aside from the recommendation of the defendants through a private evaluator or assessor, in order to reasonably ascertain the just compensation, a Board of Commissioners is hereby created and the following disinterested persons are hereby appointed as members, to wit: (1) the Branch Clerk of Court of this Court, (2) the Quezon City Assessor or his authorized representative, and (3) the Quezon City Treasurer or his authorized representative.
SO ORDERED.15
WHEREFORE, premises considered, and under [the] given circumstances, this Court fixes the just compensation for the subject properties, to wit:In fixing the amount of just compensation at P25,000.00, the RTC ruled:at Php25,000.00 per square meter to be paid to the registered owners through their attorney-in[-]fact Virgilio C. Brazil, Sr.
Transfer Certificate of Title No. Registered Owner RT - 127975 (352132) Estrella R. Decena 004-RT2010010365 (352129) Edita R. Decena N-310774 Nolan Decena Brazil RT-128458 (352131) Edita R. Decena 004-2010002076 Marieta Decena Brazil
SO ORDERED.30 (Additional emphasis supplied)
This Court, in determining the just compensation for the property subject matter of this appropriation (sic) case cannot take into consideration the BIR Zonal Valuation as the same is always relatively less than the fair market value. The valuation recommended by the commissioners cannot also be adopted as the appraised value was arrived at considering only the average of recorded sales of property within or adjacent to the subject property in Tandang Sora[,] ranging from as low as P5,780.00 to as high as Php25,190.00 per square meter, the BIR Zonal Valuation of Php14,000.00 and the highest recorded sale for adjacent property of Php25,190.00. No other documents or proofs that can serve as basis for determining market value were presented to substantiate their recommended valuation. The valuation recommended by Philippine Appraisal Co., Inc. (PACI) predominantly based on the sales, listings and other market data of comparable property within the vicinity cannot be entirely relied upon. The highest appraised value of a lot within the immediate vicinity is at Php38,500.00 per square meter is expected considering the presence of a golf course in the area, the existence of which will always command a high market value. From the foregoing, this Court believes that the fair market value for the properties subject of these expropriation cases is Php25,000.00 per square meter.31 (Underscoring supplied)Petitioner's motion for reconsideration was denied by the RTC in a Resolution32 dated November 29, 2012, for lack of merit.
Given the foregoing, We find the amount of P25,000.00 fixed by the court a quo as the full and fair equivalent of the properties sought to be expropriated. The amount considered by the court a quo for the subject properties appears to be substantial, full and ample under the circumstances.The CA observed that the case before it involved three (3) varying market values arrived at for the purpose of determining the proper amount of compensation for the subject property.35 These values were: P17,893.33 per square meter according to the BOC, P30,000.00 per square meter according to PACI, and P25,000.00 per square meter according to the RTC.36
WHEREFORE, premises considered, the assailed Resolution of the court a quo is hereby AFFIRMED IN TOTO. Accordingly, the instant appeal is hereby DENIED.34 (Emphasis in the original)
SEC. 5. Standards for the Assessment of the Value of the Land Subject of Expropriation Proceedings or Negotiated Sale. - In order to facilitate the determination of just compensation, the court may consider, among other well-established factors, the following relevant standards:To begin with, it has been held in a plethora of cases57 that the determination of just compensation in an expropriation proceeding is a function addressed to the sound discretion of the courts.58 This judicial function has a constitutional raison d'etre; Article III of the 1987 Constitution mandates that no private property shall be taken for public use without payment of just compensation.59 Consequently, the determination of just compensation remains to be an exercise of judicial discretion,60 so long as courts consider the standards laid down in statutes for the determination of just compensation,61 in this case, Section 5 of R.A. 8974.
(a) The classification and use for which the property is suited;
(b) The development costs for improving the land;
(c) The value declared by the owners;
(d) The current selling price of similar lands in the vicinity;
(e) The reasonable disturbance compensation for the removal and/or demolition of certain improvements on the land and for the value of the improvements thereon;
(f) The size, shape or location, tax declaration and zonal valuation of the land;
(g) The price of the land as manifested in the ocular findings, oral as well as documentary evidence presented; and
(h) Such facts and events as to enable the affected property owners to have sufficient funds to acquire similarly-situated lands of approximate areas as those required from them by the government, and thereby rehabilitate themselves as early as possible.
Section 9, Article III of the 1987 Constitution provides that "no private property shall be taken for public use without just compensation." Just compensation in expropriation cases has been held to contemplate just and timely payment, and prompt payment is the payment in full of the just compensation as finally determined by the courts.83 Thus, just compensation envisions a payment in full of the expropriated property. Absent full payment, interest on the balance would necessarily be due on the unpaid amount. In Republic v. Mupas,84 we held that interest on the unpaid compensation becomes due if there is no full compensation for the expropriated property, in accordance with the concept of just compensation. We held:While it is ideal that just compensation be immediately made available to the property owner so that he may derive income from that compensation, that is not always the case. If full payment is not paid for the property taken, the State must pay for the shortfall in the earning potential that the owner immediately lost due to the taking.86 Consequently, interest on the unpaid portion becomes due as compliance with the constitutional mandate on eminent domain and as a basic measure of fairness.87The reason is that just compensation would not be "just" if the State does not pay the property owner interest on the just compensation from the date of the taking of the property. Without prompt payment, the property owner suffers the immediate deprivation of both his land and its fruits or income. The owner's loss, of course, is not only his property but also its income-generating potential.
Ideally, just compensation should be immediately made available to the property owner so that he may derive income from this compensation, in the same manner that he would have derived income from his expropriated property.
However, if full compensation is not paid for the property taken, then the State must pay for the shortfall in the earning potential immediately lost due to the taking, and the absence of replacement property from which income can be derived. Interest on the unpaid compensation becomes due as compliance with the constitutional mandate on eminent domain and as a basic measure of fairness.
Thus, interest in eminent domain cases "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, as of the date of taking."85 (Emphasis in the original)
It is settled that just compensation is to be ascertained as of the time of the taking, which usually coincides with the commencement of the expropriation proceedings. Where the institution of the action precedes entry into the property, the just compensation is to be ascertained as of the time of the filing of the complaint.90 (Emphasis supplied)Thus, in a situation where the property is taken for public use before the initial deposit is made — such as in this case — interest must necessarily accrue from the time the property is taken to the time when compensation is actually paid or deposited with the court,91 in order to ensure that the owner is fully placed in a position as whole as he was before the taking occurred.
Endnotes:
* Designated additional Member per Raffle dated July 30, 2018.
1Rollo, pp. 12-30.
2 Id. at 36-49. Penned by Presiding Justice Andres B. Reyes, Jr. (now a Member of this Court) and concurred in by Associate Justices Normandie B. Pizarro and Manuel M. Barrios.
3 Id. at 52-54.
4Republic of the Philippines, rep. by the Department of Public Works and Highways (DPWH) v. Estrella R. Decena, et al.
5Rollo, pp. 93-98. Penned by Presiding Judge Ralph S. Lee.
6 Id. at 3, 105.
7 Id. at 39.
8 Id.
9 Id.
10 Civil Cases Nos. Q-10-68298, Q-10-68299, Q-10-68390, Q-10-68731, Q-10-68732. Id. at 15, 93.
11Rollo, p. 39.
12 SEC. 4. Guidelines for Expropriation Proceedings. - Whenever it is necessary to acquire real property for the right-of-way, site or location for any national government infrastructure project through expropriation, the appropriate implementing agency shall initiate the expropriation proceedings before the proper court under the following guidelines:
(a) Upon the filing of the complaint, and after due notice to the defendant, the implementing agency shall immediately pay the owner of the property the amount equivalent to the sum of (1) one hundred percent (100%) of the value of the property based on the current relevant zonal valuation of the Bureau of Internal Revenue (BIR); x x x. (now Section 6(a)(l) of R.A. 10752, AN ACT FACILITATING THE ACQUISITION OF RIGHT-OF-WAY SITE OR LOCATION FOR NATIONAL GOVERNMENT INRASTRUCTURE PROJECTS, March 7, 2016).
13Rollo, p. 39.
14 Id. at 40.
15 Id. at 16.
16 Id. at 55-58.
17 Id. at 40, 57, 94.
18 The "records" referred to in the CA Decision refer to data gathered from the Department of Assessment, Quezon City. According to these records, the prices for the sale of properties within the vicinity ranged from P5,780.00 to P25,190.00 per square meter. Id. at 44.
19Rollo, p. 44.
20 Id.
21 Id. at 41.
22 Id. at 17.
23 Id. at 59-60.
24 See id. at 61-92.
25 Id. at 66, 77, 88.
26 Id.
27 Id. at 44-45.
28 Id. at 44.
29 Id.
30 Id. at 97.
31 See id. at 96-97.
32 Id. at 99-101.
33 Id. at 42.
34 Id. at 48-49.
35 Id. at 44.
36 Id.
37 SEC. 5. Standards for the Assessment of the Value of the Land Subject of Expropriation Proceedings or Negotiated Sale. - In order to facilitate the determination of just compensation, the court may consider, among other well-established factors, the following relevant standards:
(a) The classification and use for which the property is suited;
(b) The developmental costs for improving the land;
(c) The value declared by the owners;
(d) The current selling price of similar lands in the vicinity;
(e) The reasonable disturbance compensation for the removal and/or demolition of certain improvements on the land and for the value of improvements thereon;
(f) The size, shape or location, tax declaration and zonal valuation of the land;
(g) Tiie price of the land as manifested in the ocular findings, oral as well as documentary evidence presented; and
(h) Such facts and events as to enable the affected property owners to have sufficient funds to acquire similarly-situated lands of approximate areas as those required from them by the government, and thereby rehabilitate themselves as early as possible, (now Section 7 of R.A. 10752).
38Rollo, p. 47.
39 Id.
40 534 Phil. 693 (2006).
41Rollo, p. 47.
42 Id. at 48.
43 On March 21, 2014, id. at 53.
44Rollo, p. 19.
45 Id. at 21.
46 Id. at 22.
47 Id. at 105-110, filed on December 10, 2014.
48 Id. at 108.
49 SECTION 1. Filing of petition with Supreme Court Court. — A party desiring to appeal by certiorari from a judgement or final order or resolution of the Court of Appeals, the Sandiganbayan, the Regional Trial Court or other courts whenever authorized by law, may file with the Supreme Court a verified petition for review on certiorari. The petition shall raise only questions of law which must be distinctly set forth.
50Republic v. Heirs of Eladio Santiago, G.R. No. 193828, March 27, 2017, 821 SCRA 497, 505, citing Rep. of the Phils. v. C.C. Unson Company, Inc., 781 Phil. 770 (2016); Rep. of the Phils. v. Heirs of Sps. Pedro Bautista and Valentino Malabanan, 702 Phil. 284, 297 (2013); Rep. of the Phils. v. Sps. Tan, 676 Phil. 337, 351 (2011).
51Evergreen Manufacturing Corp. v. Republic, G.R. Nos. 218628 & 218631, September 6, 2017, p. 7.
52
(1) when the factual conclusion is a finding grounded entirely on speculations, surmises and conjectures; (2) when the inference is manifestly mistaken, absurd or impossible; (3) when there is a grave abuse of discretion; (4) when the judgment is based on a misapprehension of facts; (5) when the findings of fact are conflicting; (6) when the CA went beyond the issues of the case in making its findings, which are further contrary to the admissions of both the appellant and the appellee; (7) when the CA's findings are contrary to those of the trial court; (8) when the conclusions do not cite the specific evidence on which they are based; (9) when the facts set forth in the petition as well as in the petitioner's main and reply briefs are not disputed by the respondents; and (10) when the CA's findings of fact, supposedly premised on the absence of evidence, are contradicted by the evidence on record; see Rep. of the Phils. v. Sps. Tan, supra note 50.
53 See Republic v. Heirs of Eladio Santiago, supra note 50.
54Rollo, p. 25.
55Republic v. Heirs of Eladio Santiago, supra note 50, citing Carbonell v. Carbonell-Mendes, 762 Phil. 529, 536 (2015).
56Rollo, p. 21.
57National Power Corporation v. Sps. Asoque, 795 Phil. 19, 48 (2016), citing National Power Corporation v. Sps. Zabala, 702 Phil. 491, 499-500 (2013); Evergreen Manufacturing Corp. v. Republic, supra note 51, at 8, citing Landbank of the Philippines v. Celada, 515 Phil. 467, 477 (2006); National Power Corporation v. Tuazon, 668 Phil. 301, 313 (2011); National Power Corp. v. Bagui, 590 Phil. 424, 432 (2008); Alfonso v. Land Bank of the Philippines, G.R. Nos. 181912 & 183347, November 29, 2016, 811 SCRA 27, 89, citing Export Processing Zone Authority v. Judge Dulay, 233 Phil. 313, 326 (1987).
58 Id.
59 See National Power Corporation v. Tuazon, supra note 57, at 312.
60Alfonso v. Land Bank of the Philippines, supra note 57, at 73.
61 Id. at 158.
62 Italics supplied.
63Rep. of the Phils. v. C.C. Unson Company, Inc., supra note 50, at 784.
64National Power Corporation v. Sps. Zabala, supra note 57, citing National Power Corp. v. Bagui, supra note 57.
65Republic v. Heirs of Eladio Santiago, supra note 50, at 508.
66Rep. of the Phils. v. C.C. Unson Company, Inc., supra note 50, at 784, citing Rep. of the Phils. v. Heirs of Sps. Pedro Bautista and Valentina Malabanan, supra note 50, at 298.
67Rollo, pp. 96-97.
68 Id. at 97.
69Rep. of the Phils. v. Court of Appeals, 612 Phil. 965, 979 (2009), citing Rep. of the Phils. v. Santos, 225 Phil. 29, 35 (1986).
70 See rollo, p. 39.
71 Id. at 40.
72 SEC. 4. Guidelines for Expropriation Proceedings. - Whenever it is necessary to acquire real property for the right-of-way, site or location for any national government infrastructure project through expropriation, the appropriate implementing agency shall initiate the expropriation proceedings before the proper court under the following guidelines:
(a) Upon the filing of the complaint, and after due notice to the defendant, the implementing agency shall immediately pay the owner of the property the amount equivalent to the sum of (1) one hundred percent (100%) of the value of the property based on the current relevant zonal valuation of the Bureau of Internal Revenue (BIR); x x x. (now Section 6(a)(l) of R.A. 10752).
73Section 9. Private property shall not be taken for public use without just compensation.
74Evergreen Manufacturing Corp. v. Republic, supra note 51.
75 Id. at 12, citing Land Bank of the Phils. v. Alfredo Hababag, Sr., 786 Phil. 503, 508 (2016), further, citing Land Bank of the Phils. v. Santos, 119 Phil. 587, 610 (2016).
76 SEC. 10. Rights of plaintiff after judgment and payment. — Upon payment by the plaintiff to the defendant of the compensation fixed by the judgment, with legal interest thereon from the taking of the possession of the property, or after tender to him of the amount so fixed and payment of the costs, the plaintiff shall have the right to enter upon the property expropriated and to appropriate it for the public use or purpose defined in the judgment, or to retain it should he have taken immediate possession thereof under the provisions of section 2 hereof. If the defendant and his counsel absent themselves from the court, or decline to receive the amount tendered, the same shall be ordered to be deposited in court and such deposit shall have the same effect as actual payment thereof to the defendant or the person ultimately adjudged entitled thereto. (Underscoring supplied)
77Evergreen Manufacturing Corp. v. Republic, supra note 51, at 13.
78Rep. of the Phils. v. Judge Mupas, 769 Phil. 21, 195 (2015).
79Evergreen Manufacturing Corp. v. Republic, supra note 51, at 12, citing id.
80 Id.
81 Id.
82 Id.
83Land Bank of the Phils. v. Alfredo Hababag, Sr., supra note 75, citing Land Bank of the Phils. v. Santos, supra note 76.
84 Supra note 78.
85Evergreen Manufacturing Corp. v. Republic, supra note 51, at 12.
86 Id.
87 Id.
88 Sec. 4, Rule 67 provides:
x x x 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 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. (Underscoring supplied); see also National Power Corp. v. Co., 598 Phil. 58, 70 (2009); Evergreen Manufacturing Corp. v. Republic, supra note 51, at 6.
89 290-A Phil. 371 (1992).
90 Id. at 375, citing Republic of the Philippines v. Phil. National Bank, 111 Phil. 572, 576 (1961) and reiterated in National Power Corp. v. Spouses Dela Cruz, 543 Phil. 53, 70 (2007); Romonafe Corp. v. National Power Corp., 542 Phil. 411,416 (2007); National Power Corporation v. Ong Co, 598 Phil. 58, 70 (2009).
91 See Rep. of the Phils. v. Court of Appeals, 433 Phil. 106, 122 (2002); see also Apo Fruits Corp. v. Land Bank of the Phils., 647 Phil. 251, 283 (2010).
92Rollo, p. 39.
93 Id.
94 Id.
95Rep. of the Phils. v. Judge Mupas, supra note 78, at 198, citing Eastern Shipping Lines Inc. v. Court of Appeals, 304 Phil. 236 (1994), Reyes v. National Housing Authority, 443 Phil. 603 (2003), Land Bank of the Phils. v. Wycoco, 464 Phil. 83 (2004), Rep. of the Phils. v. Court of Appeals, 494 Phil. 494 (2005); Land Bank of the Phils. v. Imperial, 544 Phil. 378 (2007); Philippine Ports Authority v. Rosales-Bondoc, 557 Phil. 737 (2007); Sps. Curata v. Philippine Ports Authority, 608 Phil. 9 (2009); Evergreen Manufacturing Corp. v. Republic, supra note 51.
96 Id.
97 See Land Bank of the Phils. v. Alfredo Hababag, Sr., supra note 75.