C.

Power of Eminent Domain

1. Definition/Scope. Also known as the power of expropriation,

a) See: Sec. 9, Art. Ill; Sec. 18, Art. XII; Secs. 4 & 9, Art. XIII.
b) Distinguished from police power. Police power is the power of the State
to promote public welfare by restraining and regulating the use of liberty and
property. The power of eminent domain is the inherent right of the State to
condemn private property to public use upon payment of just compensation.
Although both police power and eminent domain have the general welfare for
their object, and recent trends show a mingling of the two with the latter being
used as an implement of the former, there are still traditional distinctions between
the two. Property condemned under police power is usually noxious or intended
for a noxious purpose, hence no compensation is paid. Likewise in the exercise
of police power, property rights of individuals are subjected to restraints and
burdens in order to secure the general comfort, health and prosperity of the
State. Where a property interest is merely restricted because the continued use
thereof would be injurious to public interest, there is no compensable taking.
However, when a property interest is appropriated and applied to some public
purpose, there is need to pay just compensation. In the exercise of police power,
the State restricts the use of private property, but none of the property interests in
the bundle of rights which constitute ownership is appropriated for use by or for
the benefit of the public. Use of the property by the owners is limited, but no
aspect of the property is used by or for the benefit of the public. The deprivation
of use can, in fact, be total, and it will not constitute compensable taking if nobody
else acquires use of the property or any interest therein. If, however, in the
regulation of the use of the property, somebody else acquires the use or interest
thereof, such restriction constitutes compensable taking [Didipio Earth-Savers
MultiPurpose Association v. Gozun, G.R. No. 157882, March 30, 2006].

c) It is well settled that eminent domain is an inherent power of the State

that need not be granted even by the fundamental law. Sec. 9, Art. Ill of the
Constitution, in mandating that “private property shall not be taken for public use
without just compensation”, merely imposes a limit on the government’s exercise
of this power and provides a measure of protection to the individual’s right to
property. An ejectment suit should not ordinarily prevail over the State’s power of
eminent domain [Republic v. Tagle, G.R. No. 129079, December 2,
1998] .
d) The acquisition of an easement of a right of way falls within the purview
of the power of eminent domain [Camarines Norte Electric Cooperative v. Court
of Appeals, G.R. No. 109338, November 20, 2000]. In National Power
Corporation v. Manubay Agro-Industrial Develoment Corporation,437 SCRA 60, it
was reiterated that an action for a right of way filed by an electric power company
for the construction of transmission lines falls within the scope of the power of
eminent domain. As held in Republic v. PLDT, 26 SCRA 620, the power of
eminent domain normally 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 the
condemned property, without loss of title or possession. It is unquestionable that
real property may, through expropriation, be subjected to an easement of a right
of way.

e) Jurisdiction over a complaint for eminent domain is with the Regional

Trial Court. While the value of the property to be expropriated is estimated in
monetary terms — for the court is duty bound to determine the amount of just
compensation to be paid for the property — it is merely incidental to the
expropriation suit [Barangay San Roque, Talisay, Cebu v. Heirs of Francisco
Pastor, G.R. No. 138896, June 20, 2000], This is reiterated in Bardillon v.
Barangay Masili of Calamba, Laguna, G.R. No. 146886, April 30, 2003.

f) In expropriation cases, there is no such thing as the plaintiff’s matter of

right to dismiss the complaint, precisely because the landowner may have
already suffered damages at the start of the taking. The plaintiff’s right in
expropriation cases to dismiss the complaint has always been subject to court
approval and to certain conditions [National Power Corporation v. Pobre, G.R.
No. 106804, August 12, 2004]

2. Who may exercise the power. Congress and, by delegation, the

President, administrative bodies, local government units, and even private
enterprises performing public services.

a) Local government units have no inherent power of eminent

domain; they can exercise the power only when expressly authorized
by the Legislature. Sec. 19 of the Local Government Code confers
such power to local governments, but the power is not absolute; it is
subject to statutory requirements [Masikip v. City of Pasig, G.R. No.
136349, January 23, 2006; Lagcao v. Judge Labra, G.R. No.
155746, October 3, 2004]. The grant of the power of eminent domain
to local government units under R.A. 7160 cannot be understood as
equal to the pervasive and all-encompassing power vested in the
legislative branch of government. The power of eminent domain
must, by enabling law, be delegated to local governments by the
national legislature, and thus, can only be as broad or confined as
the real authority would want it to be [Republic v. Court of Appeals,
G.R. No. 146587, July 2, 2002].

b) The exercise of the right of eminent domain, whether directly by

the
State or by its authorized agents, is necessarily in derogation of private rights.
Hence, strict construction will be made against the agency exercising the power.
In the present case, the respondent failed to prove that before it filed its
complaint, it made a written, definite and valid offer to acquire the property, as
required under Sec. 19, R.A. 7160 [Jesus is Lord Christian School Foundation v.
Municipality of
Pasig, G.R. No. 152230, August 9, 2005],

c) The exercise of the power of eminent domain is clearly superior

to the final and executory judgment rendered by the court in an
ejectment case [Filstream International Inc. v. Court of Appeals, 284
SCRA 716].

d) In Iron and Steel Authority v. Court of Appeals, 249 SCRA 538, it

was held that when the statutory life of the Iron & Steel Authority
(ISA), a nonincorporated entity of government, expired in 1988, its
powers, duties and functions, as well as its assets and liabilities,
reverted to and were re-assumed by the Republic of the Philippines,
in the absence of any special provision of law specifying some other
disposition thereof. Accordingly, the Republic may be substituted as
party plaintiff in the expropriation proceedings originally instituted by
ISA.

e) In San Roque Realty v. Republic, G.R. No. 163130, September

7, 2007, the Supreme Court said that time and again, we have
declared that eminent domain cases are to be strictly construed
against the expropriator. If the Republic had actually made full
payment of just compensation, in the ordinary course of things, it
would have led to the cancellation of the title or at least, the
annotation
of the lien in favour of the government on the certificate of title. Thus, while the
general rule is that the State cannot be put in estoppel or laches by the mistakes
or errors of its officials or agents, this rule, however, admits of exceptions, one of
which is when the strict application of the rule will defeat the effectiveness of a
policy adopted to protect the public, such as the Torrens system.

3. Requisites for exercise:

a) Necessity
i) When the power is exercised by the Legislature, the
question of
necessity is generally a political question [Municipality of Meycauayan, Bulacan v.
Intermediate Appellate Court, 157 SCRA 640]; but when exercised by a delegate,
the determination of whether there is genuine necessity for the exercise is a
justiciable question [Republic v. La Orden de Po. Benedictinos, 1 SCRA 649].

ii) The issue of the necessity of the expropriation is a

matter
properly addressed to the Regional Trial Court in the course of the expropriation
proceedings. If the property owner objects to the necessity of the takeover, he
should say so in his Answer to the Complaint. The RTC has the power to inquire
into the legality of the exercise of the right of eminent domain and to determine
whether there is a genuine necessity for it [Bardillon v. Barangay Masili of
Calamba, Laguna, G.R. No. 146886, April 30, 2003].

iii) The foundation of the right to exercise eminent domain

is
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 [Lagcao
v. Judge Labra, G.R. No. 155746, October 13, 2004].

b) Private Property ,

i) Private property already devoted to public use cannot

be
expropriated by a delegate of legislature acting under a general grant of authority
[City of Manila v. Chinese Community, 40 Phil 349].
ii) All private property capable of ownership may be
expropriated,
except money and choses in action. Even services may be subject to eminent
domain [Republic v. PLDT, 26 SCRA 620].

c) Taking in the constitutional sense.

i) May include trespass without actual eviction of the

owner,
material impairment of the value of the property or prevention of the ordinary uses
for which the property was intended. In Ayala de Roxas v. City of Manila, 9 Phil
215, the imposition of an easement of a 3-meter strip on the plaintiff’s property
was considered taking. In People v. Fajardo, 104 Phil 44, a municipal ordinance
prohibiting a building which would impair the view of the plaza from the highway
was likewise considered taking. In these cases, it was held that the property
owner was entitled to payment of just compensation.

ii) Thus, in National Power Corporation v. Gutierrez, 193

SCRA 1,
the Court said that the exercise of the power of eminent domain does not always
result in the taking or appropriation of title to the expropriated property; it may
only result in the imposition of a burden upon the owner of the condemned
property, without loss of title or possession. In this case, while it is true that the
plaintiff is only after a right-of-way easement, it nevertheless perpetually deprives
defendants of their proprietary rights as manifested by the imposition by the
plaintiff upon the defendants that below said transmission lines, no plant higher
than three meters is allowed. Besides, the high-tension current conveyed by the
transmission lines poses continuing danger to life and limb.

iii) In Republic v. Castelvi, 58 SCRA 336, the Supreme

Court
enumerated the following requisites for valid taking: the expropriator must enter a
private property; entry must be for more than a momentary period; entry must be
under warrant or color of authority; property must be devoted to public use or
otherwise informally appropriated or injuriously affected; and utilization of the
property must be in such a way as to oust the owner and deprive him of
beneficial enjoyment of the property.

iv) Where there is taking in the constitutional sense, the

property
owner need not file a claim for just compensation with the Commission on Audit;
he may go directly to court to demand payment [Amigable v. Cuenca, 43 SCRA
360; de los Santos v. Intermediate Appellate Court, 223 SCRA 11; Republic v.
Sandiganbayan, 204 SCRA 212].
v) The owner of the property can recover possession of
the
property from squatters, even if he agreed to transfer the property to the
Government, until the transfer is consummated or the expropriation case is filed
[Velarma v. Court of Appeals, 252 SCRA 400].

d) Public use.
i) Concept. As a requirement for eminent domain, “public use” is the
general concept of meeting public need or public exigency. It is not confined to
actual use by the public in its traditional sense. The idea that “public use” is
strictly limited to clear cases of “use by the public” has been abandoned. The
term “public use” has now been held to be synonymous with “public interest”,
“public benefit”, “public welfare”, and “public convenience” [Reyes v. National
Housing Authority, G.R. No. 147511, January 20, 2003].

ia) The “public use” requirement for the valid exercise of the
power of eminent domain is a flexible and evolving concept influenced by
changing conditions. It is accurate to state then that at present, whatever may be
beneficially employed for the general welfare satisfies the requirement of public
use [Estate of Salud Jimenez v. PEZA, G.R. No. 137285, January 16, 2001]. The
meaning of “public use” has also been broadened to cover uses which, while not
directly available to the public, redound to their indirect advantage or benefit
[Heirs of Juancho Ardona v. Reyes, 125 SCRA 220].

ib) Thus, in Filstream International Inc. v. Court of Appeals, 284

SCRA 716, the fact that the property is less than Vi hectare and that only a few
could actually benefit from the expropriation does not diminish its public use
character, inasmuch as “public use” now includes the broader notion of indirect
public benefit or advantage, including, in particular, urban land reform and
housing.

ic) The practical reality that greater benefit may be derived by

Iglesia ni Cristo members than most others could well be true, but such peculiar
advantage still remains merely incidental and secondary in nature. That only few
would actually benefit from the expropriation of the property does not necessarily
diminish the essence and character of public use [Manosca v. Court of Appeals,
252 SCRA 412].
ii) When exercised by a local government unit. By express legislative
authority granted by Congress in Sec. 19, RA 7160, local government units may
expropriate private property for public use, or purpose, or welfare, for the benefit
of the poor and the landless. Thus, in Moday v. Court of Appeals, 268 SCRA 568,
the Supreme Court held that the Sangguniang Panlalawigan (of Agusan del Sur)
was without authority to disapprove Bunawan Municipal Resolution No. 43-89
because, clearly, the Municipality of Bunawan has the authority to exercise the
power of eminent domain and its Sangguniang Bayan the capacity to promulgate
the assailed resolution.
iia) However, note that in Municipality of Paranaque v. V. M.
Realty Corporation, 292 SCRA 676, the Supreme Court declared that there was
lack of compliance with Sec. 19, R.A. 7160, where the Municipal Mayor filed a
complaint for eminent domain over two parcels of land on the strength of a
resolution passed by the Sanggunian Bayan, because what is required by law is
an ordinance.

iib) In Lagcao v. Judge Labra, G.R. No. 155746, October 13,

2004, the Supreme Court said that condemnation of private lands in an irrational
or piecemeal fashion, or the random expropriation of small lots to accommodate
no more than a few tenants or squatters, is certainly not the condemnation for
public use contemplated by the Constitution. This deprives a citizen of his
property for the convenience of a few without perceptible benefit to the public.
Moreover, prior to the passage of Ordinance No. 1843, there was no evidence of
a valid and definite offer to buy petitioners’ property, as required by Sec. 19, R.A.
7160.

e) Just compensation.

i) Concept. The full and fair equivalent of the property taken; it is the
fair market value of the property. It is settled that the market value of the property
is “that sum of money which a person, desirous but not compelled to buy, and an
owner, willing but not compelled to sell, would agree on as a price to be given
and received therefor”.

ia) The aforementioned rule, however, is modified where only a

part of a certain property is expropriated. In such a case, the owner is not
restricted to payment of the market value of the portion actually taken. In addition
to the market value of the portion taken, he is also entitled to payment of
consequential damages, if any, to the remaining part of the property. At the same
time, from the total compensation must be deducted the value of consequential
benefits, if any, provided consequential benefits shall not exceed consequential
damages [National Power Corporation v. Spouses Chiong, G.R. No. 152436,
June 20, 2003].

ib) Just compensation means not only the correct amount to be

paid to the owner of the land but also payment within a reasonable time from its
taking [Eslaban v. De Onorio, G.R. No. 146062, June 28, 2001].

ic) The tax credit given to commercial establishments for the

discount enjoyed by senior citizens pursuant to R.A. 7432 (Senior Citizens Act) is
a form of just compensation for private property taken by the State for public use,
since the privilege enjoyed by senior citizens does not come directly from
the State, but from the private establishments concerned [Commissioner of
Internal Revenue v. Central Luzon Drug Corporation, G.R. No. 148512, June 26,
2006; Commissioner of Internal Revenue v. Bicolandia Drug Corporation, G.R.
No.
148083, July 21, 2006],

ii) Judicial prerogative. The ascertainment of what constitutes just

compensation for property taken in eminent domain cases is a judicial
prerogative, and PD 76, which fixes payment on the basis of the assessment by
the assessor or the declared valuation by the owner, is unconstitutional [EPZA v.
Dulay, 148 SCRA 305]. PD 1533 and PD 42, insofar as they sanction executive
determination of just compensation in eminent domain cases, are
unconstitutional [Panes v. Visayas State College of Agriculture, 263 SCRA 708].
Another Presidential Decree (PD 1670) which authorizes the City Assessor to fix
the value of the property is also unconstitutional [Belen v. Court of Appeals, 195
SCRA 59]. This declaration of unconstitutionality may be given retroactive effect
[Republic v. Court of Appeals, 227 SCRA 401].

iia) In Republic (DAR) v. Court of Appeals, 263 SCRA 758, it was

held that under R.A. 6657 (CARL), the decision of the provincial adjudicator need
not be appealed to the DARAB before resort may be made to the RTC. The RTC,
as special agrarian court, is given original and exclusive jurisdiction over two
categories of cases, namely: (1) all petitions for the determination of just
compensation to landowners; and (2) the prosecution of all criminal offenses
under R.A. 6657.

iii) Need to appoint commissioners. In Manila Electric Co. v. Pineda, 206

SCRA 196, the Supreme Court held that in an expropriation case where the
principal issue is the determination of the amount of just compensation, a trial
before the commissioners is indispensable, in order to give the parties the
opportunity to present evidence on the issue of just compensation. Trial with the
aid of commissioners is a substantial right that may not be done away with
capriciously or for no reason at all.

iiia) While commissioners are to be appointed by the court for the

determination of just compensation, the latter is not bound by the commissioners’
findings [Republic v. Santos, 141 SCRA 30; Republic (MECS) v. Intermediate
Appellate Court, 185 SCRA 572], However, the court may substitute its own
estimate of the value of the property only for valid reasons, to wit: (a) the
commissioners have applied illegal principles to the evidence submitted to them;
(b) they have disregarded a clear preponderance of evidence; or (c) where the
amount allowed is either grossly inadequate or excessive [National Power
Corporation v. De la Cruz, G.R. No. 156093, February 2, 2007].
iiib) But trial by commissioners is not mandatory in agrarian
reform cases, because Sec. 58 of R.A. 6657 provides that the appointment of a
commissioner or commissioners is discretionary on the part of the special
agrarian court (SAC), or upon the instance of one of the parties. Thus, the
modality provided in Rule 67 of the Rules of Court for the appointment of 3
commissioners is not compulsory on the SAC [Spouses Edmond Lee and Helen
Huang v. Land Bank of the Philippines, G.R. No. 170422, March 7, 2008].

iv) Form of compensation. Compensation is to be paid in money and

no other. But in Association of Small Landowners v. Secretary of Agrarian
Reform, supra., 175 SCRA 343, it was held that in agrarian reform, payment is
allowed to be made partly in bonds, because under the CARP, “we do not deal
with the traditional exercise of the power of eminent domain; we deal with a
revolutionary kind of expropriation”.

iva) However, in Land Bank v. Court of Appeals (and

Department of Agrarian Reform v. Court of Appeals), 249 SCRA 149, reiterated
in Sta. Rosa Realty & Development Corp. v. Court of Appeals, G.R. No. 112526,
October 12, 2001, the Court declared that, as explicitly provided by Sec. 16(e),
R.A. 6657, the deposit of compensation must be in “cash” or in “Land Bank
bonds”, not in any other form, and certainly not in a “trust account”. While the
Association ruling allowed a deviation in the traditional mode of payment other
than cash, this did not dispense with the settled rule.that there must be payment
of just compensation before the title to the expropriated property is transferred.
Thus, in the Resolution on the Motion for Reconsideration, 258 SCRA 404, the
Court said that upon receipt by the landowner of the corresponding payment or,
in case of rejection or no response from the landowner, upon the deposit with an
accessible bank designated by DAR of the compensation in cash or in Land
Bank bonds in accordance with this Act, the DAR shall take immediate
possession of the land and shall request the proper Register of Deeds to issue a
Transfer Certificate of Title in the name of the Republic of the Philippines. The
provision is very clear and unambiguous, foreclosing any doubt as to allow an
expanded construction, which would include the opening of “trust accounts”
within the coverage of the term “deposit”.

v) Withdrawal of deposit by rejecting landowner. In the same

Resolution on the Motion for Reconsideration [Land Bank v. Court of Appeals],
the Supreme Court also allowed the withdrawal by the rejecting landowner of the
money deposited in trust pending the determination of the valuation of the
property. By rejecting and disputing the valuation of the DAR, the landowner is
merely exercising his right to seek just compensation. If we are to affirm the
withholding of the release of the offered compensation despite depriving the
owner of the possession and use of his property, we are in effect penalizing the
latter for simply exercising a right. Without prompt payment, compensation
cannot be considered “just”, for the property owner is made to suffer the
consequence of being immediately deprived of his land while being made to wait
for a decade or more before actually receiving the amount necessary to cope
with his loss. To allow the taking of the landowners’ properties, and in the
meantime leave them empty-handed by withholding payment of just
compensation while the government speculates on whether or not it will pursue
expropriation, or worse, for government to subsequently decide to abandon the
property and return it to the landowner when it has already been rendered
useless by force majeure, is undoubtedly an oppressive exercise of eminent
domain that must never be sanctioned.

vi) Reckoning point of market value of the property. Compensation

is determined as of the date of the filing of the complaint for eminent domain, but
where the filing of the complaint occurs after the actual taking of the property
and the owner would be given undue incremental advantages arising from the
use to which the government devotes the property expropriated, just
compensation is determined as of the date of the taking [National Power
Corporation v. Court of Appeals, 254 SCRA 577]. See also: Republic v. Lara, 50
O.G. 5778; Republic v. Castelvi, 58 SCRA 336; Commissioner of Public
Highways v. Burgos, 96 SCRA 831; National Power Corporation v. Gutierrez,
supra.; Belen v. Court of Appeals, 195 SCRA 59.

via) However, in Eslaban v. De Onorio, G.R. No. 146062, June

28, 2001, the Supreme Court said that in the instances where the appropriating
agency takes over the property prior to the expropriation suit, just compensation
shall be determined as of the time of the taking, not as of the time of the filing of
the complaint for eminent domain. Thus, it was declared that the value of the
property must be determined either as of the date of the taking or the filing of the
complaint, “whichever comes first”.

vib) It should be noted that the principal criterion in determining

just compensation is the character of the land at the time of the taking. In
National Power Corporation v. Henson, G.R. No. 129998, December 29, 1998,
where the trial judge based his computation-on the price of lots in the adjacent
developed subdivision — although the five parcels were agricultural but later
reclassified as residential — the Supreme Court said that the trial judge had no
valid basis for his computation. The tax declaration is only one of the factors to
be used in determining the market value of the property for purposes of arriving
at the amount to be paid by way of just compensation [Republic v. Ker & Co.,
G.R. No. 136171, July 2, 2002].

vie) When eminent domain is exercised by a local government

unit, 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” [Sec. 19, R.A. 7160]. This was applied in City of Cebu v. Spouses
Dedamo, G.R. No. 142971, May 7, 2002, precisely because the expropriator was
the City of Cebu, a local government unit, and the Rules of Court cannot prevail
over R.A. 7160, a substantive law. In Nepomuceno v. City of Surigao, G.R. No.
146091, July 28, 2008, it was held that the value of the property shall be
ascertained as of the date it was actually taken, because it is as of that time that
the real measure of the owner’s loss may be fairly adjudged.

vii) Entitlement of owner to interest. In Nepomuceno v. City of Surigao,

supra., it was held that once the value of the property is fixed by the court, the
amount shall earn interest at the legal rate until full payment is effected. National
Power Corporation v. Angas, 208 SCRA 542, fixes the interest due the property
owner at the rate of 6% per annum, prescribed in Art. 2209 of the Civil Code, and
not 12% per annum under Central Bank Circular No. 416, because the latter
applies to loans or forbearance of money, goods or credits, or judgments
involving such loans or forbearance of money goods or credits. The kind of
interest involved here is by way of damages, hence Art. 2209 of the Civil Code
applies.

viia) In some expropriation cases, the Court imposed an interest

of 12% per annum on the just compensation due the landowner. It must be
stressed, however, that in these cases, the imposition of interest was in the
nature of damages for delay in payment which, in effect, makes the obligation on
the part of government one of forbearance. It follows that the interest in the form
of damages cannot be applied where there was prompt and valid payment of just
compensation. Conversely, where there was delay in tendering a valid payment
of just compensation, imposition of interest is in order. In this case, the
replacement of the trust account with cash or LBP bonds did not ipso facto cure
the lack of compensation, for essentially, the determination of this compensation
was marred by the lack of due process. Thus, the compensation due Wycoco
should bear 12% interest per annum from the time LBP opened a trust account in
his name up to the time said account was actually converted into cash and LBP
bonds [Wycoco v. Judge Caspillo, G.R. No. 146733, January 13, 2004].

viii) Who else may be entitled to just compensation. Entitlement to

the payment of just compensation is not, however, limited to the “owner”, but
includes all those who have lawful interest in the property to be condemned,
including a mortgagee, a lessee and a vendee in possession under an executory
contract. But where, as in this case, the intervenors had no longer any legal
interest in the property because at the time of the expropriation their claim of
ownership had already been resolved and put to rest, then they are not entitled to
be impleaded as parties or to payment of just compensation [Knechtv. Court of
Appeals, G.R. No. 108015, May 20, 1998],

ix) Title to the property. Title does not pass until after payment [Visayan
Refining v. Camus, 40 Phil 550], except in agrarian reform [Resolution on Motion
for Reconsideration, Land Bank v. Court of Appeals, 258 SCRA 404].

ixa) Thus, the owner of land subject to expropriation may

still dispose of the same before payment of just compensation [Republic v. Salem
Investment Corporation, G.R. No. 137569, June 23, 2000].

ixb) Taxes paid by owner after taking by the expropriator

are reimbursable [City of Manila v. Roxas, 60 Phil 215].

x) Right of landowner in case of non-payment of just

compensation. As a rule, “non-payment of just compensation in an expropriation
proceeding does not entitle the private landowners to recover possession of the
expropriated lots”, but only to demand payment of the fair market value of the
property [Republic of the Philippines v. Court of Appeals, G.R. No. 146587, July
2, 2002; Reyes v. National Housing Authority, G.R. No. 147511, January 20,
2003].

xa) However, in Republic of the Philippines v. Vicente Lim,

G.R. No. 161656, June 29, 2005, the Supreme Court said that the facts of the
case do not justify the application of the rule. In this case, the Republic was
ordered to pay just compensation twice, the first was in the expropriation
proceedings, and the second, in the action for recovery of possession, but it
never did. Fifty seven
(57) years passed since the expropriation case was terminated, but the Republic
never paid the owners. The Court construed the Republic’s failure to pay just
compensation as a deliberate refusal on its part. Under such circumstances,
recovery of possession is in order. It was then held that where the government
fails to pav iust compensation within five years from the finality of the judgment in
the expropriation proceedings, the owners concerned shall have the right to
recover possession of their property.

f) Due process of law. The defendant must be given an opportunity

to be heard. In Belenv. Court of Appeals, supra., the Supreme Court declared
PDs 1670 and 1669 unconstitutional for violating the due process clause
because the decrees do not provide for any form of hearing or procedure by
which the petitioners can question the propriety of the expropriation or the

reasonableness of the compensation to be paid for the property. See also

Filstream International, Inc. v. Court of Appeals, 284 SCRA 716.

4. Writ of Possession. The issuance of the writ of possession becomes

ministerial upon the [i] filing of a complaint for expropriation sufficient in form and
substance, and [ii] upon deposit made by the government of the amount
equivalent to fifteen percent (15%) of the fair market value of the property sought
to be expropriated per current tax declaration [Biglang-Awa v. Judge Bacalla,
G.R. Nos. 139927-139936, November 22, 2000; Bardillon v. Barangay Masili of
Calamba, Laguna, supra.]. The determination of whether the taking of the
property is for a public purpose is not a condition precedent before the court may
issue a writ of possession. Once the requisites mentioned above are established,
the issuance of the writ becomes a ministerial matter for the expropriation court
[Francia, Jr. v. Municipality of Meycauayan, G.R. No 170432, March 24, 2008].

a) A hearing will have to be held to determine whether or not the

expropriator complied with the requirements of R.A. 7279. It is,
therefore, premature for the Court of Appeals to insist on finding
whether petitioner resorted to the other modes of acquisition
provided in RA 7279, as this question will have to await the hearing
on the complaint itself [City of Manila v. Serrano, G.R. No. 142302,
June 20, 2001]. This hearing, however, is not a hearing to determine
if a writ of possession is to be issued, but whether there was
compliance with the requirements for socialized housing. Once the
two requisites above are complied with, then the writ of possession
shall issue as a ministerial duty [City of Iloilo v.
Judge Legaspi, G.R. No. 154616, November 25, 2004].
5. Plaintiff’s right to dismiss the complaint in eminent domain. In
expropriation cases, there is no such thing as the plaintiff’s “matter-of-right” to
dismiss the complaint, precisely because the landowner may have already
suffered damages at the start of the taking. The plaintiff’s right to dismiss the
complaint has always been subject to Court approval and to certain conditions
[National Power Corporation & Pobre v. Court of Appeals, G.R. No 106804
August
12, 2004]. ’
6

6. Right to repurchase or re-acquire the property. In Mactan-Cebu

International Airport Authority v. Court of Appeals, G.R. No. 139495,
November 27, 2000, it was held that the property owner’s right to
repurchase the property depends upon the character of the title acquired
by the expropriator, i.e., if land is expropriated for a particular purpose
with the condition that when that purpose is ended or abandoned, the
property shall revert to the former owner, then the former owner can re-
acquire the
of the judgment in the expropriation case were very clear and unequivocal, granting title to the lot in fee simple
to the Republic. No condition on the right to repurchase was imposed.

a) In arguing for the return of their property on the basis of nonpayment, respondents ignore the fact
that that the right of the expropriatory authority is different from that of an unpaid seller in ordinary sales to
which the remedy of rescission may perhaps apply. Expropriation is an in rem proceeding, and after
condemnation, the paramount title is in the public under a new and independent title [Republic v. Court of
Appeals, G.R. No. 146587, July 2, 2002].

8. Expropriation under Sec. 18, Art. XII: “The State may, in the interest of national welfare or defense,
establish and operate vital industries and, upon payment of just compensation, transfer to public
ownership utilities and other private enterprises to be operated by the Government”.

a) Distinguish this from Sec. 17, Art. XII: “In times of national emergency, when the public
interest so requires, the State may, during the emergency and under reasonable terms prescribed
by it, temporarily take over or direct the operation of any privately owned public utility or business
affected with public interest”.

i) In Agan, Jr. v. Philippine International Air Terminals Co., G.R.

No. 155001, Baterina v. Philippine International Air Terminals Co., G.R. No. 155547, Lopez v. Philippine
International Air Terminals Co., G.R. No. 155661, May 05, 2003, the Supreme Court said that PIATCO cannot,
by mere contractual stipulation, contravene this constitutional provision, and obligate the government to pay
“reasonable cost for the use of the Terminal and/or Terminal complex”. The constitutional provision 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.

ii) Note that 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 said business and its properties, as the temporary takeover by
the government is in exercise of the police power and not the power of eminent domain [Agan, Jr. v. PIATCO,
supra.].

iii) In David v. Macapagal-Arroyo, supra., the Court declared that Sec. 17, Art. XII must
be understood as an aspect of the emergency powers clause. The taking over of private
businesses affected with public interest is just another facet of the emergency powers
generally reposed in Congress. Thus, when Sec. 17, Art. XII, provides that “The State
may, during the emergency and under reasonable terms and conditions prescribed by it,
temporarily take over or direct the operation of any privately-owned public utility or
business affected with public interest”, it refers to Congress, not the President. Whether
the President may exercise such power is dependent on whether Congress delegates it
to the former pursuant to a law prescribing the reasonable terms thereof.

9. Expropriation under Secs. 4 and 9, Art. XIII.

a) Comprehensive Agrarian Reform Law. See Association of Small Landowners v. Secretary of

Agrarian Reform, supra., on the constitutionality of the Comprehensive Agrarian Reform Law,
being an exercise of the police power of the State, using eminent domain as an instrument to
accomplish the police objective. In Sta. Rosa Realty & Development Corp. v. Court of Appeals,
G.R. No. 112526, October 12, 2001, it was held that to the extent that the CARL prescribes
retention limits to the landowners, there is an exercise of the police power for the regulation or
private property in accordance with the Constitution. But where to carry out such regulation, the
owners are deprived of lands they own in excess of the maximum area allowed, there is also
taking under the power of eminent domain. The taking contemplated is not a mere limitation on
the use of the land, but the surrender of the title to and physical possession of the excess and all
beneficial rights accruing to the owner in favor of the beneficiary. See also Paris v. Alfeche, G.R.
No. 139083, August 30, 2001, on the validity of the retention limits.

b) R.A. 7279 fUrban Development and Housing Act of 1992j .

i) In Filstream International Inc. v. Court of Appeals, 284 SCRA 716, the Court took
judicial notice of the fact that urban land reform has become a paramount task of
Government in view of the acute shortage of decent housing in urban areas, particularly
in Metro Manila. Nevertheless, local government units are not given an unbridled
authority when exercising this power in pursuit of solutions to these problems. The basic
rules still have to be followed, i.e., Sec. 1 and Sec. 9, Art. Ill of the Constitution. Thus,
even

Sec. 19 of the Local Government Code imposes certain restrictions on the exercise of the power of eminent
domain. R.A. 7279 (Urban Development and Housing Act of 1992) — the governing law which deals with the
subject of urban land reform and housing — provides the order in which lands may be acquired for socialized
housing, and very explicit in Secs. 9 and 10 thereof is the fact that privately-owned lands rank last (6 th) in the
order of priority for purposes of socialized housing. Expropriation proceedings may, therefore, be resorted to
only when the other modes of acquisition have been exhausted. Compliance with these conditions must be
deemed mandatory because they are the only safeguards in securing the right of owners of private property to
due process when their property is expropriated for public use. This was reiterated in Lagcao v. Judge Labra,
G.R. No. 155746, October 13, 2004].

ii) In City of Mandaluyong v. Francisco, G.R. No. 137152, January 29, 2001, the
Supreme Court reiterated that under RA 7279, lands for socialized housing are to be
acquired in the following order: (1) government lands; (2) alienable lands of the public
domain; (3) unregistered, abandoned or idle lands; (4) lands within the declared Areas for
Priority Development, Zonal Improvement Program sites, Slum Improvement and
Resettlement sites which have not yet been acquired; (5) BLISS sites which have not yet
been acquired; and (6) privately owned lands. The mode of expropriation is subject to
two conditions, namely: [a] it shall be resorted to only when the other modes of
acquisition have been exhausted; and [b] parcels owned by small property owners are
exempt from such acquisition. Small property owners are [1] owners of residential lands
with an area not more than 300 sq. m. in highly urbanized cities and not more than 800
sq. m. in other urban areas; and [2] they do not own residential property other than the
same. In this case, the respondents fall within the classification of small property owners.