Course Outline Constitutional Law II POWER OF EMINENT DOMAIN 1. Sumulong v.

Guerrero, 154 SCRA 461 National Housing Authority (NIIA) filed a complaint for expropriation of parcels of land. The land sought to be expropriated were alued by the NHA at one peso (!1."") per s#uare meter adopting the mar$et alue fixed by the pro incial assessor in accordance with presidential decrees prescribing the aluation of property in expropriation proceedings. Together with the complaint was a motion for immediate possession of the properties. The NHA deposited the amount of !1%&'(&"."" with the !hilippine National )an$' representing the *total mar$et alue* of the sub+ect twenty fi e hectares of land' pursuant to !residential ,ecree No. 1--. which defines * !e "ol#$% on !e e&"ro"r#' #on o( "r#v' e "ro"er % (or )o$#'l#*e+ !ou)#ng u"on "'%men o( ,u) $om"en)' #on./n 0anuary 11' 1(1&' respondent 0udge issued the following /rder2 !laintiff ha ing deposited with the !hilippine National )an$' Heart 3enter 4xtension /ffice' ,iliman' 5ue6on 3ity' 7etro 7anila' the amount of !1%&'(&"."" representing the total mar$et alue of the sub+ect parcels of land' let a writ of possession be issued The pro isions on +ust compensation found in !residential ,ecree Nos. 1--.' which were declared unconstitutional in Export Processing Zone All thirty vs. Dulay' for being encroachments on prerogati es. a. b. c. w8n there was public use9 :es w8n there was 0ust compensation9 No w8n there was ,ue process9 No immediate ta$ing without notice and hearing are iolati e of due process .. Mun#$#"'l# % o( /#0'n v. 1u+ge M'r G'r$#',123 SCRA 546 ?acts2 1. T!#) #) 'n e&"ro"r#' #on )u# (#le+ 5% "e # #oner 'g'#n) !e o6ner) o( 11 '+,'$en "'r$el) o( l'n+) #n /#n'n intended for use as the new site of ' mo+ern "u5l#$ m'r7e 'n+ !e '$8u#)# #on 6') 'u !or#*e+ 5y ;angguniang )ayan appro ed by April 11' 1(&= -. Howe er one of the defendants (4rlinda ?rancisco) filed motion to dismiss pursuant to sec = @ule A1 @ules of the 3ourt on the grounds that> a. the petition is ague and con+ectural b. the petition iolates the constitutional limitations of law and +urisprudence on eminent domain c. its oppressi e d. it is barred by prior decision on the sub+ect matter e. no cause of action B;ec =. Cithin the time specified in summons each defendant shall present in ;IND<4 motion to dismiss all his8her ob+ections =. Howe er' the respondent 0udge issue writ f possession in fa or of the municipality .. ,efendant filed a separate trial' presented e idence and claims that there had already been no delay in bringing all defendants within courts +urisdiction since their defenses are basically the same' The 3ourt Dranted the 7otion %. 0udge Darcia found the following> a. <ocal 3learance was issued by H;@3 to ?erlins @ealty owned by ?@AN3I;3/ to con ert to commercial complex b. According to the Testimony of Atty 0or ina of H;@3 locational clearance ac#uired a ested right o er the sub+ect property c. ;uch clearance should be considered as disposition of property through eminent domain d. Hence' a legal bar against petitioner 7unicipality of )inan A. The ?iscal' called the trials courts attention for the irregularity of allowing ?rancisco to present her e idence ahead of the plaintiff and this also urged the !etitioner to file for a 7otion of @econsideration alleging the re ersal of the order of trial. Also'

a. ;ociali6ed housing* is defined as' *the construction of dwelling units for the middle and lower class members of our society' including the construction of the supporting infrastructure and other facilities The ta$ing to be alid must be for public use. Housing is a basic human need. ;hortage in housing is a matter of state concern since it directly and significantly affects public health' safety' the en ironment and in sum' the general welfare b. 0ust compensation means the alue of the property at the time of the ta$ing. It means a fair and full equivalent for the loss sustained. A<< the facts as to the condition of the property and its surroundings' its impro ements and capabilities' should be considered. This 3ourt holds that *sociali6ed housing* defined in !res. ,ecree No. 1--.' as amended by !res. ,ecree Nos. 1-%( and 1=1=' constitutes *public use* for purposes of expropriation. Howe er' as pre iously held by this 3ourt' the pro isions of such decrees on +ust compensation are unconstitutional> c. and in the instant case the 3ourt finds that the /rders issued pursuant to the corollary pro isions of those decrees authori6ing

Course Outline Constitutional Law II claims that the multiple appeals are allowed by law in actions of eminent domain and the period is =" days not 1% days The 3ourt issued an order declaring 7unicipalityEs motion filed out of time beyond the 1% day period of appeal prescribed by law. Issue2 C8N multiple appeals is allowed by law and the period is =" days not 1%9 @uling2 The 3ourt presented - stages in e ery action for expropriation which is also the same for partition and accounting order 1. ,etermination of authority of !laintiff to exercise power of eminent domain8when coFownership exist -. ,etermination of the 3ourt for +ust compensation (w8 the assistance of = commissioners)8when coFowners agree with partition The 3ourt held that that in actions of eminent domain' since no less than - appeals are allowed by law the period for appeal is ="days counted from the notice of order and not the ordinary period of 1% days pursuant to )atas !ambansa 1-( and in accordance to @ule 1"( @ules of the 3ourt. 9. M'n#l' Ele$ r#$ Com"'n% v. P#ne+', .36 SCRA 1:6 ?acts2 - ?or the purpose of constructing a -=" GH Transmission line' 74@A<3/ filed a complaint for eminent domain against Arayon' ;r.' Du6man' ;antiago and )autista (pri ate respondents)' claiming that it needs portion of their land for the said construction. o The parties howe er failed to reach an agreement as to the compensation. - !ri ate respondents filed a motion for payment and withdrawal' which was granted by the respondent +udge. - 74@A<3/ #uestions the alidity of the order for payment of the respondent 0udge !ineda' claiming that !ineda had ignored the procedure laid down by law in determining +ust compensation because it formulated an opinion on its own as to the alue of the land without allowing the )oard of 3ommissioners to hold hearings for the reception of e idence. Issue2 Chether the court can dispense with the assistance of a )oard of 3ommissioners in an expropriation proceeding and determine for itself +ust compensation. @uling2 No. Tr#'l 5e(ore !e $omm#))#oner) #) #n+#)"en)'5le o 'llo6 !e "'r #e) o "re)en ev#+en$e on !e #))ue o( ,u) $om"en)' #on. ;tage in action for 4minent ,omain2 o ,etermination of the authority of the plaintiff to exercise the power of eminent domain and the propriety of its exercise in the context in ol ed in the suit. o ,etermination by the 3ourt of the +ust compensation for the property sought to be ta$en. T!#) #) +one 5% !e Cour 6# ! !e '))#) 'n$e o( no more !'n 9 $omm#))#oner) The appointment of at least = competent persons as commissioners to ascertain +ust compensation is a mandatory re#uirement in expropriation cases. Chile it is true that the findings of the commissioners may be disregarded and the court may substitute its own estimate of the alue' it may only do so for alid reasons2 o Chere the commissioners ha e applied illegal principles to the e idence submitted to them> o Chere they ha e disregarded a clear preponderance of e idence> or o Chere the amount allowed is either grossly inade#uate or excessi e. @espondent +udge arri ed at the aluation of !."."" per s#uare meter of a property declared for real estate tax purposes at !-.%" per hectare on the basis of a I0oint Henture Agreement on ;ubdi ision and Housing !ro+ectsJ executed by A)A Homes and pri ate respondents K reliance on such without any proof of aluation is incompetent proof to determine +ust compensation. In addition' prior to the determination of +ust compensation' the property owners may rightfully demand to withdraw from the deposit made of the condemnor howe er' upon an award of a smaller amount by the court' the property owners are sub+ect to a +udgment for the excess or upon the award of a larger sum' they are entitled to a +udgment for the amount awarded by the court.

4. N' #on'l Po6er) Cor"or' #on v. 1u+ge 1o$)on, .36 SCRA 5. ?acts2 !etitioner filed se en (1) eminent domain cases before the @egional Trial 3ourt for the ac#uisition of a rightFofFway easement o er portions of the parcels of land described in the complaints for its NegrosF!anay Interconnection !ro+ect' particularly the /'$olo+; Tomon on Tr'n)m#))#on <#ne. The complaints uniformly (a) allege that petitioner urgently needs portions of the affected land to enable it to construct its tower and transmission line in a manner that is compatible with the greatest good while at the same time causing the least pri ate in+ury> the purpose for which the lands are principally de oted will not be impaired by the transmission lines as it will only ac#uire a rightFofFwayF easement thereon. @espondent 0udge' finding the existence of paramount public interest which may be ser ed by the expropriation' the long range benefit of the pro+ect in ol ed' substantial compliance with the rules concerning efforts for negotiation and' ta$ing into consideration the mar$et alue of the sub+ect areas and the daily opportunity profit that the petitioner allegedly admitted in open court' issued an /rder fixing the pro isional alues of the sub+ect areas. In compliance with the said /rder' petitioner deposited the total sum of !-='1&"'&-&."" with the !N). The defendants filed a motion for the reconsideration alleging that the pro isional alue of the property in ol ed therein *had been set much too low* considering the allegations therein adduced' stating

Course Outline Constitutional Law II that the real compensation that should accrue to them is estimated at !-('(1"'"""."". @espondent 0udge issued an /rder granted the motion. In compliance with the said /rder' petitioner immediately deposited the additional sum of !--'&AA'&A"."" with the !N). Re)"on+en 1u+ge 'g'#n #))ue+ 'n or+er ')7#ng "e # #oner o "'% '++# #on'l 'moun ) 'n+ or+er#ng !' !e 6r# o( "o))e))#on 5e #))ue+ #n !e)e $')e) '( er !e +e(en+'n ) -!'ve +ul% re$e#ve+ !e 'moun )=. Lnable to accept the order' petitioner filed a petition alleging therein' that respondent 0udge acted in excess of +urisdiction' in iolation of laws and in dereliction of the duty to afford respondents due process when he issued said /rders. I))ue> C/N @espondent +udge acted in excess +urisdiction when he issued said /rders. @uling2 :es. The petition is meritorious. @espondent 0udge committed gra e abuse of discretion amounting to lac$ of +urisdiction' and is otherwise either unmindful or ignorant of the law2 when he fixed the pro isional alues of the properties for the purpose of issuing a writ of possession on the basis of the mar$et alue and the daily opportunity profit petitioner may deri e in iolation or in disregard of !.,. No. .- in amending such determination in $')e) 5% #n$re')#ng !e )'me 6# !ou !e'r#ng> in directing the defendants to manifest within twentyFfour (-.) hours whether or not they are accepting and withdrawing the amounts' representing the pro isional alues' deposited by the plaintiff for each of them as *final and full satisfaction of the alue of their respecti e property>* in declaring the pro isional alues as the final alues and directing the release of the amounts deposited' in full satisfaction thereof' to the defendants e en if not all of them made the manifestation> and in suspending the issuance of the writ of possession until after the suspending the amounts shall ha e been released to and recei ed by defendants. Lpon the filing of the complaint or at any time thereafter' the petitioner has the right to ta$e or enter upon the possession of the property in ol ed upon compliance with !.,. No. .- which re#uires the petitioner' after due notice to the defendant' to deposit with the !hilippine National )an$ in its main office or any of its branches or agencies, -'n 'moun e8u#v'len o !e '))e))e+ v'lue o( !e "ro"er % (or "ur"o)e) o( '&' #on.* This assessed alue is that indicated in the tax declaration. P.D. No. 4., !o6ever, e((e$ #vel% remove) !e +#)$re #on o( !e $our #n +e erm#n#ng !e "rov#)#on'l v'lue. Chat is to be deposited is an amount e#ui alent to the assessed alue for taxation purpose. No hearing is re#uired for that purpose. All that is needed is notice to the owner of the property sought to be condemned. 5. C# % o( M'n#l' v. C!#ne)e Commun# %, 43 P?I<. 94: ?A3T;2 !roperty of @espondents was to be expropriated by !etitioner for the extension of @i6al A enue. I;;L42 C/N the courts can in#uire regarding the necessity of such expropriation. H4<,2 :es' the courts ha e ample authority' in this +urisdiction' to ma$e in#uiry' and to hear proof upon an issue properly presented' concerning #uestion whether or

not the purpose of the expropriation is' in fact' for some public use. The ;3 also stated that !etitioner cannot expropriate public property' and since it is planning to expropriate a cemetery' it is not alid' because cemeteries are for public use. Also' in the present case' e en granting that a necessity exists for the opening of the street in #uestion' the record contains no proof of necessity of opening the same through the cemetery. 6. Re"u5l#$ o( !e P!#l#""#ne) v. P<DT, .6 SCRA 6.3 F'$ )> The plaintiff @epublic of the !hilippines is a political entity exercising go ernment powers through one of its branches' the )ureau of Telecommunication. Herein defendant' !<,T is a public ser ice corporation holding a franchise to install operates and maintains a telephone system. After its creation' the )/T set up its own go ernment telephone system by utili6ing its own appropriations and other e#uipment and by renting trun$ lines of the !<,T to enable the go t offices to call pri ately. )/T entered into an agreement with the @3A communications for +oint o erseas telephone ser ice whereby )/T would con ey o erseas calls recei ed by @3A to local residents. PLDT complained to the BOT that it was a violation of the condition of their agreement since the BOT had used trunk lines only for the use of government offices but even to serve private persons or the general public in competition with the business of PLDT. ;ubse#uently' the plaintiff commenced suit against !<,T as$ing the court +udgment be rendered ordering the !<,T to execute a contract with the plaintiff' through the )/T for the use of the facilities of !<,TMs telephone system throughout the country under such conditions as the court may consider reasonable. The 3?I rendered +udgment stating that it could not compel !<,T to enter into such agreement. Hence this petition. I))ue> Chether or Not !<,T may be compelled to enter into such agreement. ?el+> :es' the state' may' in the interest of national welfare transfer utilities to public ownership upon payment of +ust compensation' there is no reason why the state may not re#uire a public utility to render ser ices in the general interest pro ided +ust compensation is paid. 4. N' #on'l Po6er Cor"or' #on v. Gu #erre*, 1:9 SCRA !laintiff initiated negotiations for the ac#uisition of right of way easements o er the aforementioned lots for the construction of its transmission lines for the purpose of determining the fair and +ust compensation due the defendants' the court appointed three commissioners' comprised of

Course Outline Constitutional Law II one representati e of the plaintiff' one for the defendants and the other from the court The commissioner for the plaintiff corporation recommended the following2 . . . that plaintiff be granted right of way easement o er the 1A" s#uare meters of the defendants 7alit and Dutierre6 land for plaintiff transmission line upon payment of an easement fee of !1."" therefor The commissioner for the defendant spouses recommended the following2 . . . that 7r. and 7rs. @icardo 7alit be paid as disturbance compensation the amount of !1"."" s#. meter or the total amount of !1'A"".""M (Annex G) The 3ourtMs commissioner recommended the following2 . . . the payment of ?i e (! %.//) !esos per s#uare meter of the area co ered by the @ightFofFway to be granted' It is the contention of petitioner that the 3ourt of Appeals committed gross error by ad+udging the petitioner liable for the payment of the full mar$et alue of the land tra ersed by its transmission lines' and that it o erloo$s the undeniable fact that a simple rightFofFway easement (for the passage of transmission lines) transmits no rights' except that of the easement. ?ull ownership is retained by the pri ate respondents and they are not totally depri ed of the use of the land. They can continue planting the same agricultural crops' except those that would result in contact with the wires. /n this premise' petitioner submits that if full mar$et alue is re#uired' then full transfer of ownership is only the logical e#ui alent. CH4TH4@ !4TITI/N4@ ;H/L<, )4 7A,4 T/ !A: ;I7!<4 4A;474NT ?44 /@ ?L<< 3/7!4N;ATI/N ?/@ TH4 <AN, T@AH4@;4, ): IT; T@AN;7I;;I/N <IN4;

that real property may' through expropriation' be sub+ected to an easement of rightFofFway. In the case at bar' the easement of rightFofFway is definitely a ta$ing under the power of eminent domain. 3onsidering the nature and effect of the installation of the -=" GH 7exicoF<imay transmission lines' the limitation imposed by N!3 against the use of the land for an indefinite period depri es pri ate respondents of its ordinary use. Just compensation has always been understood to be the just and complete equivalent of the loss which the owner of the thing e propriated has to suffer by reason of the e propriation The price or alue of the land and its character at the time it was ta$en by the Do ernment are the criteria for determining +ust compensation It appearing that the trial court did not act capriciously and arbitrarily in setting the price of !%."" per s#uare meter of the affected property' the said award is proper and not unreasonable. 2. N' #on'l Po6er Cor"or' #on v. S"). C!#ong, G.R. No. 15.496, 1une .3, .339 ?acts2 1. !etitioner is a D/33' created pursuant to @A A=(% for the purpose of underta$ing the de elopment of hydroelectric power' the production of electrical power from any source particularly by constructing' operating and maintaining power plants xxxx and similar wor$s to tap the power generated from any ri er' cree$' la$e spring or waterfall in the country and supplying such power to the inhabitants thereof. Hence' by irtue of its authority to exercise power of eminent domain filed a petition in @T3 of Nambales to sought ac#uisition of an easement of right of way and certain portions of agricultural lands owned by the respondents (3hiong and Hiers of Agrifina) -. Heirs of Agrifina claimed that N!3 had already ta$en possession of portion of tier realty .'""" s# m(</T A) and wanted to occupy the ad+acent lot (</T)) also .'""" s# m with fair mar$et alue of 1'1"" per s# m hence should be entitled of !&'&""'""" for +ust compensation =. @T3 appointed = commissioners to determine the fair mar$et alue of the land and as well as the total area ta$en by N/3 .. - of the 3ommissioner submitted their report and classified the property as unirrigated rice and shall ha e a fair mar$et alue of !%"" per s# m while the other commissioner submitted its

@uling2 The owner is entitled of +ust compensation not +ust merely payment of easement fee The trial courtMs obser ation shared by the appellate court show that *. . . Chile it is true that plaintiff are ( sic) only after a rightFofFway easement' it ne ertheless perpetually depri es defendants of their proprietary rights as manifested by the imposition by the plaintiff upon defendants that below said transmission lines no plant higher than three (=) meters is allowed. ?urthermore' because of the highF tension current con eyed through said transmission lines' danger to life and limbs that may be caused beneath said wires cannot altogether be discounted' and to cap it all plaintiff only pays the fee to defendants once' while the latter shall continually pay the taxes due on said affected portion of their property.* Normally' of course' the power of eminent domain results in the ta$ing or appropriation of title to' and possession of' the expropriated property> but no cogent reason appears why said power may not be a ailed of to impose only a burden upon the owner of condemned property' without loss of title and possession. It is un#uestionable

Course Outline Constitutional Law II report recommending N!3 to pay </T A for !--.% per s# m and </T ) for 1%.1%. Howe er' by ma+ority @T3 ga e due course to the report gi en by the commissioners hence ordered N!3 to pay respondents for !%"" per s# m N!3 argued that @T3 gra ely abused its discretion on the following grounds > a. The @T3 should issue and order of expropriation first before ordering them to pay for +ust compensation b. The @T3 adopted the recommendation of the ma+ority of the commissioner without hearing in iolation of @L<4 A1 ;ection 1 which needs to conduct hearing for the recommendation submitted c. The @T3 ordered them to pay the full mar$et alue than only the 4A;474NT ?44 since they were only in o$ing easement right. It was only after more than 1" years that NA!/3/@ admitted that the sub+ect land was indeed owned by 7angondato. They howe er' were not able to reach an agreement as to the compensation which resulted to NA!/3/@ filing complaint for eminent domain. The court with the assistance of = commissioners' fixed the alue of compensation at !1'""" per s#uare meter' the alue of the property as of 1((-. NA!/3/@ #uestioned the alue of compensation claiming that it should be based on the alue of the property at the time that it too$ possession.

%.

Issue2 At what point in time should the alue of land sub+ect expropriation be computed2 at the date of the ta$ing or the date of filing of the complaint for eminent domain. @uling2 Deneral @ule2 Halue of the property as of the date of the filing of the complaint. o Normally' the time of ta$ing coincides with the filing of the complaint for expropriation hence' many rulings of this 3ourt ha e e#uated +ust compensation with the alue of the property as of the time of filing of the complaint. o ;o too' where the institution of the action precedes entry into the property' the +ust compensation is to be ascertained as of the time of the filing of the complaint. E&$e" #on> W!ere !e o6ner 6oul+ 5e g#ven un+ue #n$remen 'l '+v'n 'ge) 'r#)#ng (rom !e u) o 6!#$! !e governmen +evo e) !e "ro"er % e&"ro"r#' e+, !e $our 6#ll (#& !e v'lue o( !e "ro"er % ') o( !e +' e # 6') '7en 'n+ no !e +' e o( !e $ommen$emen o( !e e&"ro"r#' #on "ro$ee+#ng). o To permit them to do so would be to allow them to reco er more than the alue of the land at the time it was ta$en' which is the true measure of the damages' or +ust compensation' and would discourage the construction of important public impro ements. In the case howe er' NA!/3/@ was unable to pro e that its occupancy and use K not ordinary inflation and increase in land alues K was the direct cause of the increase in aluation from 1(1&F1((-. Also' Ita$ingJ' a main ingredient in the exercise of eminent domain' re#uires a number of circumstances to be present2 o 4xpropriator must enter a pri ate property> o 4ntrance in the pri ate property must be for more than a momentary period> o 4ntry into the property should be under warrant or color of legal authority> o !roperty must be de oted to a public use or otherwise informally appropriated or in+uriously affected> o Ltili6ation of the property for public use must be in such a way to oust the owner and depri e him of all beneficial en+oyment of the property.

Issue2 C8N the @T3 gra ely abuse its discretion9 @uling2 No' 1. The respondent did not #uestion N!3Es right to expropriated the only #uestion is the amount of +ust compensation to be paid. -. ?ormal type of hearing is not necessary for expropriation proceedings as long as both parties are afforded fair and reasonable opportunity to be heard before the order to pay compensation is issued. N!3 was gi en ample time to ob+ect the recommendation of the commissioners but failed to do so. =. The expropriation was not only limited to easement of right of way since it stated that it would erect structures for its transmission lines in portions of the expropriated property. BIn 4minent ,omain or expropriation proceedings' the general rule is that 0ust compensation is entitled to its 7A@G4T HA<L4. 7ar$et alue is the sum of money which is desirous but not compelled to buy and owner not compelled to sell would agree on the price. Howe er' if only part of the land is expropriated the owner is not restricted to compensation for the portion actually ta$en but also in addition to the mar$et alue that was ta$en he is also entitled to reco er for the conse#uential damage. :. N' #on'l Po6er Cor"or' #on v. CA, .54 SCRA 544 ?acts2 - NA!/3/@ too$ possession of the land 7angondato (pri ate respondent)' belie ing that it was part of public land reser ed for its use under !roclamation No. 1=%.. - Chen NA!/3/@ started building its Agus I H4 (Hydroelectric plant) pro+ect' 7angondato demanded compensation' which NA!/3/@ refused claiming that the sub+ect land was part of public land.

Course Outline Constitutional Law II - NA!/3/@Es entrance in 1(1& was without intent to expropriate or was not made under the warrant or color of legal authority' for it belie ed the property was public land and it refused 7angodatoEs claim for compensation. ?inally' trial before 3ommissioners is indispensable to allow parties to present e idence on the issue of +ust compensation. o Inasmuch as the determination of +ust compensation in eminent domain cases is a +udicial function' factual findings are re iewable only when the case falls within the recogni6ed exceptions' which is not the case here K the court finds to reason to disturb the aluation of the sub+ect property. 13. N' #on'l Po6er Cor"or' #on v. Ang'), .32 SCRA 534 !etitioner National !ower 3orporation' a D/33 and the agency through which the go ernment underta$es the onFgoing infrastructure and de elopment pro+ects throughout the country' filed two complaints for eminent domain against pri ate respondents with the 3ourt of ?irst Instance. The complaint which )oug! o e&"ro"r#' e $er '#n )"e$#(#e+ lo ) )# u' e+ ' <#mog'o, S'gu#'r'n, <'n'o +el Sur was for the purpose of the de elopment of hydroFelectric power and production of electricity as well as the erection of such subsidiary wor$s and constructions as may be necessarily connected therewith. The lower court declared that the lots mentioned and described in the complaints ha e entirely been lawfully condemned and expropriated by the petitioner' and ordering the latter to pay the pri ate respondents certain sums of money as +ust compensation for their lands expropriated *with legal interest thereon until fully paid. * Two consecuti e motions for reconsideration of the said consolidated decision were filed by the petitioner. The same were denied by the respondent court. /ne of the pri ate respondents filed an exFparte motion for the execution of the decision' praying that petitioner be directed to pay her the unpaid balance of !1.'=""."" for the lands expropriated from her' including legal interest which she computed at AO per annum. The said motion was granted by the lower court. !etitioner complied with said order and deposited the sums of money with interest computed at AO per annum. /ne of the pri ate respondents' through counsel' also filed with the trial court an exFparte motion praying' for the first time' that the legal interest on the +ust compensation awarded to her by the court be computed at 1-O per annum as allegedly *authori6ed under and by irtue of 3ircular No. .1A of the 3entral )an$ issued pursuant to !residential ,ecree No. 11A and in a decision of the ;upreme 3ourt that legal interest allowed in the +udgment of the courts' in the absence of express contract' shall be computed at 1-O per annum.* The lower court granted the said motion allowing 1-O interest per annum. ;ubse#uently' the other pri ate respondents filed motions also praying that the legal interest on the +ust compensation awarded to

them be computed at 1-O per annum' on the basis of which the lower court issued orders bearing similar import. !etitioner mo ed for a reconsideration of the lower courtMs last order dated August -&' 1(&1' alleging that the main decision had already become final and executory with its compliance of depositing the sums of money as +ust compensation for the lands condemned' with legal interest at AO per annum> that the said main decision can no longer be modified or changed by the lower court> and that !, 11A is not applicable to this case because it is Art. --"( of the 3i il 3ode which applies. The lower court denied petitionerMs' motion for reconsideration' stating that the rate of interest at the time of the promulgation of the decision is that prescribed by 3entral )an$ 3ircular No. .1A issued pursuant to !residential ,ecree No. 11A' which is 1-O per annum' and that it did not modify or change but merely amplified its order of in the determination of the legal interest. Issue2 C/N the 3ourt can increase the AO interest to 1-O interest thereby modifying its pre ious rendered decision. @uling2 No. !ri ate respondentsM contention is bereft of merit. The term *+udgments* as used in ;ection 1 of the Lsury <aw' as well as in 3entral )an$ 3ircular No. .1A' should be interpreted to mean only +udgments in ol ing loan or forbearance of money' goods or credits' following the principle of e+usdem generis. In the case at bar' the transaction in ol ed is clearly not a loan or forbearance of money' goods or credits but expropriation of certain parcels of land for a public purpose' the payment of which is without stipulation regarding interest' and the interest ad+udged by the trial court is in the nature of indemnity for damages. The legal interest re#uired to be paid on the amount of +ust compensation for the properties expropriated is manifestly in the form of indemnity for damages for the delay in the payment thereof. Therefore' since the $ind of interest in ol ed in the +oint +udgment of the lower court sought to be enforced in this case is interest by way of damages' and not by way of earnings from loans' etc. Art. --"( of the 3i il 3ode shall apply. 11. W%$o$o v.1u+ge C')"#llo, G.R. No. 146499, 1'n. 19, .334 ?A3T;2 The undisputed antecedents show that ?eliciano ?. Cycoco is the registered owner of a (..1A(" hectare unirrigated and untenanted rice land' co ered by Transfer 3ertificate of Title No. NTF-"A.-- and situated in the ;itios of Ablang' ;aguingan and !inamunghilan' )arrio of ;an 0uan' <icab' Nue a 4ci+a..

In line with the 3omprehensi e Agrarian @eform !rogram (3A@!) of the go ernment' Cycoco oluntarily offered to sell the land to the ,epartment of Agrarian @eform (,A@) for !1..( million. % In No ember 1((1' after the ,A@Es e aluation of the application and the determination of the +ust compensation by the <and )an$ of the !hilippines (<)!)' a no #$e o( #n en #on o '$8u#re 24.56:3 !e$ 're) o( !e "ro"er % (or P1,94.,664.466 6') )en o W%$o$o.

Course Outline Constitutional Law II The amount offered was later raised to !-'%(.'".%.=( and' upon re iew' was modified to !-'-&"'1%(.&-.1 T!e 're' 6!#$! !e DAR o((ere+ o '$8u#re e&$lu+e+ #+le l'n+), r#ver 'n+ ro'+ lo$' e+ !ere#n. Cycoco re+ected the offer' prompting the ,A@ to indorse the case to the ,epartment of Agrarian @eform Ad+udication )oard (,A@A)) for the purpose of fixing the +ust compensation in a summary administrati e proceeding. 7eanwhile' ,A@ and <)! filed their respecti e answers before the special agrarian court in Agrarian 3ase No. (1 (A?)' contending that the aluation of CycocoEs property was in accordance with law and that the latter failed to exhaust administrati e remedies by not participating in the summary administrati e proceedings before the ,A@A) which has primary +urisdiction o er determination of land aluation.1. The issues for resolution are as follows2 (1) ,id the @egional Trial 3ourt' acting as ;pecial Agrarian 3ourt' alidly ac#uire +urisdiction o er the instant case for determination of +ust compensation9 (-) Assuming that it ac#uired +urisdiction' was the compensation arri ed at supported by e idence9 (=) 3an Cycoco compel the ,A@ to purchase the entire land sub+ect of the oluntary offer to sell9 (.) Cere the awards of interest and damages for unreali6ed profits alid9 Lnder ;ection 1 of 4xecuti e /rder No. ."%' ;eries of 1(("' the <and )an$ of the !hilippines is charged with the initial responsibility of determining the alue of lands placed under land reform and the +ust compensation to be paid for their ta$ing. -A Through a no #$e o( volun 'r% o((er o )ell @AOS) submitted by the landowner' accompanied by the re#uired documents' the ,A@ e aluates the application and determines the landEs suitability for agriculture. The <)! li$ewise re iews the application and the supporting documents and determines the aluation of the land. Thereafter' the ,A@ issues the Notice of <and Haluation to the landowner. In both oluntary and compulsory ac#uisition' where the landowner re+ects the offer' the ,A@ opens an account in the name of the landowner and conducts a summary administrati e proceeding. If the landowner disagrees with the aluation' the matter may be brought to the @egional Trial 3ourt acting as a special agrarian court. This in essence is the procedure for the determination of +ust compensation.-1 In the case at bar' therefore' the trial court properly ac#uired +urisdiction o er CycocoEs complaint for determination of +ust compensation. It must be stressed that although no summary administrati e proceeding was held before the ,A@A)' <)! was able to perform its legal mandate of initially determining the alue of CycocoEs land pursuant to 4xecuti e /rder No. ."%' ;eries of 1((". Chat is more' ,A@ and <)!Es conformity to the preFtrial order which limited the issue only to the determination of +ust compensation estopped them from #uestioning the +urisdiction of the special agrarian court. The preFtrial order limited the issues to those not disposed of by admission or agreements> and the entry thereof controlled the subse#uent course of action.=" Inasmuch as the aluation of the property of Cycoco is the ery issue in the case at bar' the trial court should ha e allowed the parties to present e idence thereon instead of practically assuming a aluation without basis. Chile mar$et alue may be one of the bases

of determining +ust compensation' the same cannot be arbitrarily arri ed at without considering the factors to be appreciated in arri ing at the fair mar$et alue of the property e.g.' the cost of ac#uisition' the current alue of li$e properties' its si6e' shape' location' as well as the tax declarations thereon.== ;ince these factors were not considered' a remand of the case for determination of +ust compensation is necessary. The power to ta$e +udicial notice is to be exercised by courts with caution especially where the case in ol es a ast tract of land. 3are must be ta$en that the re#uisite notoriety exists> and e ery reasonable doubt on the sub+ect should be promptly resol ed in the negati e. To say that a court will ta$e +udicial notice of a fact is merely another way of saying that the usual form of e idence will be dispensed with if $nowledge of the fact can be otherwise ac#uired. This is because the court assumes that the matter is so notorious that it will not be disputed. )ut +udicial notice is not +udicial $nowledge. The mere personal $nowledge of the +udge is not the +udicial $nowledge of the court' and he is not authori6ed to ma$e his indi idual $nowledge of a fact' not generally or professionally $nown' the basis of his action.=. Anent the third issue' the ,A@ cannot be compelled to purchase the entire property oluntarily offered by Cycoco. The power to determine whether a parcel of land may come within the co erage of the 3omprehensi e Agrarian @eform !rogram is essentially lodged with the ,A@. That Cycoco will suffer damages by the ,A@Es nonF ac#uisition of the approximately 1" hectare portion of the entire land which was found to be not suitable for agriculture is no +ustification to compel ,A@ to ac#uire the whole area. Ce find CycocoEs claim for payment of interest partly meritorious. In Land Ban of the Philippines v. !ourt of Appeals"=% this 3ourt struc$ down as oid ,A@ Administrati e 3ircular No. (' ;eries of 1(("' which pro ides for the opening of trust accounts in lieu of the deposit in cash or in bonds contemplated in ;ection 1A (e) of @A AA%1. In some expropriation cases' the 3ourt imposed an interest of 1-O per annum on the +ust compensation due the landowner. It must be stressed' howe er' that in these cases' the imposition of interest was in the nature of damages for delay in payment which in effect ma$es the obligation on the part of the go ernment one of forbearance. =& It follows that the interest in the form of damages cannot be applied where there was prompt and alid payment of +ust compensation. 3on ersely' where there was delay in tendering a alid payment of +ust compensation' imposition of interest is in order. This is because the replacement of the trust account with cash or <)! bonds did not ipso facto cure the lac$ of compensation> for essentially' the determination of this compensation was marred by lac$ of due process.=( Accordingly' the +ust compensation due Cycoco should bear 1-O interest per annum from the time <)! opened a trust account in his name up to the time said account was actually con erted into cash and <)! bonds deposit accounts. The basis of the 1-O interest would be the +ust compensation that would be determined by the ;pecial Agrarian 3ourt upon remand of the instant case. In the same ein' the amount determined by the ;pecial Agrarian 3ourt would also be the basis of the interest income on the cash and bond deposits due Cycoco from the time of the ta$ing of the property up to the time of actual payment of +ust compensation.

Course Outline Constitutional Law II The award of actual damages for unreali6ed profits should be deleted. The amount of loss must not only be capable of proof' but must be pro en with a reasonable degree of certainty. The claim must be premised upon competent proof or upon the best e idence obtainable' such as receipts or other documentary proof. ." None ha ing been presented in the instant case' the claim for unreali6ed profits cannot be granted. ?rom the foregoing discussion' it is clear that CycocoEs petition for mandamus in D.@. No. 1.A1== should be dismissed. The decision of the @egional Trial 3ourt of 3abanatuan 3ity' )ranch -=' acting as ;pecial Agrarian 3ourt in Agrarian 3ase No. (1 (A?)' cannot be enforced because there is a need to remand the case to the trial court for determination of +ust compensation. <i$ewise' the prayer for the inhibition of 0udge @odrigo ;. 3aspillo in Agrarian 3ase No. (1 (A?) is denied for lac$ of basis. W?EREFORE' in iew of all the foregoing' the petition in D.@. No. 1."1A" is !A@TIA<<: D@ANT4,. Agrarian 3ase No. (1 (A?) is @47AN,4, to the @egional Trial 3ourt of 3abanatuan 3ity' )ranch -=' for the determination of +ust compensation. The petition for mandamus in D.@. No. 1.A1== is dismissed. SO ORDERED. 1.. Bne $! v. CA, G.R. No. 132315, M'% .3, 1::2

entitled to compensation' to all those who ha e lawful interest in the property to be condemned' including a mortgagee' a lessee and a endee in possession under an executory contract. 4 ery person ha ing an estate or interest at law or in e#uity in the land ta$en is entitled to share in the award. If a person claiming an interest in the land sought to be condemned is not made a party' he is gi en the right to inter ene and lay claim to the compensation. 3i il 3ase No. 1=-1' the expropriation case' was filed on 7ay 1%' 1((". ?our months earlier' in 0anuary 1(("' 3i il 3ase No. -(A1F! for recon eyance was dismissed with finality by this 3ourt and +udgment was entered in ?ebruary 1((". The Gnechts lost whate er right or colorable title they had to the property after we affirmed the order of the trial court dismissing the con eyance case. The fact that the Gnechts remained in physical possession cannot gi e them another cause of action and resurrect an already settled case. The GnechtsM possession of the land and buildings was based on their claim of ownership' not on any +uridical title such as a lessee' mortgagee' or endee. ;ince the issue of ownership was put to rest in 3i il 3ase No. -(A1F!' it follows that their physical possession of the property after the finality of said case was bereft of any legality and merely subsisted at the tolerance of the registered owners. This tolerance ended when ;alem filed 3i il 3ase No. &%F-A= for unlawful detainer against the Gnechts. As prayed for' the trial court ordered their e+ectment and the demolition of their remaining house. Indeed' the Gnechts had no legal interest in the property by the time the expropriation proceedings were instituted . They had no right to inter ene and the trial court did not err in denying their *7otion for Inter ention and to Implead Additional !arties.* Their inter ention ha ing been denied' the Gnechts had no personality to mo e for the inhibition of respondent 0udge ;ayo from the case. The 3ourt of Appeals therefore did not err in dismissing 3AFD.@. ;! No. -1&11. 19. Re"u5l#$ v. C') elv#, 52 SCRA 996 ?acts2 1. C') ellv#C) "ro"er % !') 5een o$$u"#e+ 5% P!#l '#r For$e )#n$e 1:44 under a special contract of lease and before the expiration of the contract in 0une ="' 1(%A RP 6'n e+ o rene6 !e $on r'$ 5u C') ellv# re(u)e+ 'n+ )en !em ' le er )'%#ng !' !e% +e$#+e+ o )u5+#v#+e !e "ro"er % for sale to the general public hence demanding that the property to be acated within =" days. -. A?! answered the letter saying it would be difficult to acate the property in iew of the permanent installations and other facilities amount to !%""'""" were already erected and with no other recourse will ac#uire the property instead by expropriation. =. The @epublic argued that by irtue of special lease agreement between them and 3astell i which granted them right and pri ilege to buy the property if the lessor wish to terminate the lea e and in e en of sale the stipulated mar$et alue should be from the time of their occupancy 1(.1 and that the permanent impor ements amounting to more than half million pesos constructed during the period of 1- years until expropriation proceeding in 1(%( was indicati e of agreed pattern pf permanency and stability of occupancy by !hil Air ?orce in the interest of National ;ecurity .

In 1(&-' the 3ity Treasurer of !asay disco ered that the Gnechts failed to pay real estate taxes on the property from 1(&" to 1(&-. As a conse#uence of this deficiency' the 3ity Treasurer sold the property at public auction on 7ay -1' 1(&- for the sum of !A='""".""' the amount of the deficiency taxes. The highest bidders were respondent ;pouses Anastacio and ?elisa )abiera (the )abieras) and respondent ;pouses Ale+andro and ?lor ;angalang (the ;angalangs). /n 7arch 1-' 1(&%' ;angalang and )abiera sold the land to respondent ;alem In estment 3orporation (;alem) ;ince the Gnechts refused to acate their one remaining house' ;alem instituted against them 3i il 3ase No. &%F-A= for unlawful detainer. The 7unicipal Trial 3ourt' granted the complaint and ordered the GnechtsM e+ectment. !ursuant to a writ of execution' the last house of the Gnechts was demolished on April A' 1((1 the Gnechts instituted 3i il 3ase No. &.-= before the @egional Trial 3ourt' )ranch 111' !asay 3ity for reco ery of ownership and possession of the property. w8n the $nechts ha e legal right to inter ene9 No The defendants in an expropriation case are not limited to the owners of the property condemned. They include all other persons owning' occupying or claiming to own the property. Chen a parcel of land is ta$en by eminent domain' the owner of the fee is not necessarily the only person who is entitled to compensation. In the American +urisdiction' the term *owner* when employed in statutes relating to eminent domain to designate the persons who are to be made parties to the proceeding' refers' as is the rule in respect of those

Course Outline Constitutional Law II .. Hence' As the property supposed to be assessed for the purposes of +ust compensation the Do ernment claims that the property deemed to be ta$en in 1(.1 when the leased commenced not on upon the expropriation proceeding in 1(%(. %. Also respondent further claims that the re#uisites for the proper ta$ing of property should be strictly followed> @45LI;IT4; of ta$ing of property are the following2 1.the expropriator must enter a pri ate property -. the entrance into the pri ate property must be more than momentary period =. the entry into the property should be under warrant or color of legal authority .. the property must be de oted to a public use or otherwise informally appropriated or in+uriously affected %.and the utili6ation of the property for public use may such a way as to oust the owner and depri e him of all beneficial en+oyment of the property. Issue2 C8N the +ust compensation should be determined upon the ta$ing of the property9 @uling2 SC !el+, No !e A'lue o( !e Pro"er % (or "ur"o)e) o( ,u) $om"en)' #on mu) 5e +e erm#ne+ ') o( !e +' e o( (#l#ng o( !e $om"l'#n un+er )e$ 4 Rule 64 Rule) o( !e Cour . It is clear therefore that the ta$ing of 3astell iEs property for purposes of eminent domain cannot be considered to ha e ta$en place in 1(.1. ;3 ga e merit to the contention of 3astell i regarding the - essential elements in ta$ing property under power of eminent domain2 1. that the entrance and occupance of condemnor must be permanent or indefinite period -. that in de oting the property to public use the owner was ousted from the property and depri ed of its beneficial use' were not present when the A?! entered and occupied in the property in 1(.1. 14. Re"u5l#$ v. Ber D Co., G.R. No. 196141, 1ul% ., .33. ?acts2 - @epublic filed a petition for expropriation of portions of parcels land (;ite I and ;ite II) owned by respondents for the widening of the road. - The court fixed the alue of the property at !AG8s#m for ;ite I and !%'.-=..&8s#m for ;ite II. - Re"u5l#$ $l'#m) !' !e v'lue o( S# e I #) e&$e))#ve 'n+ unre')on'5le ') !e '& +e$l'r' #on o( !e "ro"er % #n+#$' e+ # ) '))e))e+ v'lue ' P4.5.33 'n+ # ) m'r7e v'lue ' P24:.33 onl%. Issue2 Chether the alue fixed for compensation of the sub+ect property was excessi e. @uling2 No. T!e v'lu' #on 6') no e&$e))#ve 'n+ unre')on'5le, even #( !e '& +e$l'r' #on o( !e "ro"er % #n+#$' e+ le))er v'lue.

;tatements made in tax documents may ser e as one of the factors to be considered but they cannot exclude or pre ail o er a court determination after expert commissioners ha e examined the property and all pertinent circumstances are ta$en into account and after all the parties ha e had their opportunity to fully plead their cases before a competent and unbiased tribunal. o 3ommissioner made a careful study of the properties sub+ect of expropriation and considered factors such as the location' the most profitable li$ely use of the remaining area' si6e' shape' accessibility as well as listing of properties within the icinity to arri e at a reasonable estimate of +ust compensation for the lots. In $om"u #ng ,u) $om"en)' #on (or e&"ro"r#' #on "ro$ee+#ng), # #) !e v'lue o( !e l'n+ ' !e #me o( !e '7#ng or !e #me o( (#l#ng o( !e $om"l'#n no ' !e #me o( !e ren+# #on o( ,u+gmen 6!#$! )!oul+ 5e '7en #n o $on)#+er' #on. ;ec. .' @ule A1 of the 1((1 @ules of 3i il !rocedure pro ides that +ust compensation is to be determined as of the date of the ta$ing or filing of the complaint whiche er comes first.

15. P!#l#""#ne Pre)) In) # u e, In$. v. Comele$, .44 SCRA .4. F'$ )> @espondent 3omelec promulgated @esolution No. -11+#re$ #ng ne6)"'"er) o "rov#+e (ree Comele$ )"'$e o( no le)) !'n one;!'l( "'ge (or !e $ommon u)e o( "ol# #$'l "'r #e) 'n+ $'n+#+' e). The 3omelec space shall be allocated by the 3ommission' free of charge' among all candidates to enable them to ma$e $nown their #ualifications' their stand on public Issue and their platforms of go ernment. The 3omelec space shall also be used by the 3ommission for dissemination of ital election information. !etitioner !hilippine !ress Institute' Inc. (!!I)' a nonFprofit organi6ation of newspaper and maga6ine publishers' as$s the ;upreme 3ourt to declare 3omelec @esolution No. -11unconstitutional and oid on the ground that it iolates the "ro!#5# #on #m"o)e+ 5% !e Con) # u #on u"on !e governmen 'g'#n) !e '7#ng o( "r#v' e "ro"er % (or "u5l#$ u)e 6# !ou ,u) $om"en)' #on. /n behalf of the respondent 3omelec' the ;olicitor Deneral claimed that the @esolution is a permissible exercise of the power of super ision (police power) of the 3omelec o er the information operations of print media enterprises during the election period to safeguard and ensure a fair' impartial and credible election. I))ue> Chether or not 3omelec @esolution No. -11- is unconstitutional. ?el+> T!e Su"reme Cour +e$l're+ !e Re)olu #on ') un$on) # u #on'l. It held that to compel print media companies to donate I3omelec spaceJ amounts to Ita$ingJ of pri ate personal property without payment of the +ust compensation re#uired in expropriation cases. 7oreo er' the element of necessity for the ta$ing has not been established by respondent 3omelec' considering that the newspapers were not unwilling to sell ad ertising space. The ta$ing of pri ate property for public use is authori6ed by the

Course Outline Constitutional Law II constitution' but not without payment of +ust compensation. Also @esolution No. -11- does not constitute a alid exercise of the police power of the state. In the case at bench' there is no showing of existence of a national emergency to ta$e pri ate property of newspaper or maga6ine publishers. 16. Am#g'5le v. Cuen$', 49 SCRA 963 ?A3T;2 Amigable is the owner of a land that was expropriated by the Do ernment for a road widening pro+ect. The Do ernment did not follow the procedural re#uirement for expropriation. And that the lot in #uestion was already con erted8constructed as part of the road widening pro+ect. I;;L42 Chat is the remedy of !etitioner9 H4<,2 3onsidering that no annotation in fa our of the go ernment appears at the bac$ of her certificate of title that she has not executed any deed of con eyance of any portion of her lot to the go ernment' the appellant remains the owner of the whole lot. As registered owner' she could bring action to reco er possession of the portion of land in #uestion at anytime because possession is one of the attributes of ownership. Howe er' since restoration of possession of said portion by the go ernment is neither con enient nor feasible at this time because it is now and has been used for road purposes' the only remedy a ailable is for the go ernment to ma$e due compensation which it could and should ha e done years ago before expropriating such land. 11. Re"u5l#$ v. CA, G.R. No. 146524, 1ul% ., .33. !etitioner instituted expropriation proceedings on 1( ;eptember 1(A( before the @egional Trial 3ourt (*@T3*) of )ulacan' co ering a o 'l o( 544,:23 )8u're me er) o( $on #guou) l'n+ )# u' e+ 'long M'$Ar !ur ?#g!6'%' 7alolos' )ulacan' o 5e u #l#*e+ (or !e $on #nue+ 5ro'+$') o"er' #on 'n+ u)e o( r'+#o r'n)m# er ('$#l# #e) (or !e Ao#$e o( !e P!#l#""#ne) "ro,e$ . !etitioner' through the !hilippine Information Agency (!IA)' too$ o er the premises after the pre ious lessee' the Hoice of America' had ceased its operations thereat. Pe # #oner m'+e ' +e"o)# o( P514,552.23, !e )um "rov#)#on'll% (#&e+ ') 5e#ng !e re')on'5le v'lue o( !e "ro"er %. On .6 Fe5ru'r% 1:4:, or more !'n n#ne %e'r) '( er !e #n) # u #on o( !e e&"ro"r#' #on "ro$ee+#ng). It would appear that the national go ernment failed to pay to herein respondents the compensation pursuant to the foregoing decision' such that a little o er fi e years later' or on "( 7ay 1(&.' re)"on+en ) (#le+ ' m'n#(e) ' #on 6# ! ' mo #on )ee7#ng "'%men (or !e e&"ro"r#' e+ "ro"er %. /n "1 0une 1(&.' the )ulacan @T3' after ascertaining that the heirs remained unpaid in the sum of !1'"%&'A%%."%' issued a writ of execution ser ed on the plaintiff' through the /ffice of the ;olicitor Deneral' for the implementation thereof. Chen the order was not complied with' respondents again filed a motion urging the trial court to direct the pro incial treasurer of )ulacan to release to them the amount of !1-'A&=.%%' a portion of the sum deposited by petitioner at the inception of the expropriation proceedings in 1(A(' corresponding to their share of the deposit. The trial court' in its order of 1" 0uly 1(&.' granted the motion.

In the meantime, Pre)#+en 1o)e"! E,er$# o E) r'+' #))ue+ Pro$l'm' #on No. ..,E. r'n)(err#ng .3 !e$ 're) o( !e e&"ro"r#' e+ "ro"er % o !e /ul'$'n S ' e Fn#ver)# % (or !e e&"'n)#on o( # ) ('$#l# #e) 'n+ 'no !er 5 !e$ 're) o 5e u)e+ e&$lu)#vel% (or !e "ro"'g' #on o( !e P!#l#""#ne $'r'5'o . The remaining portion was retained by the !IA. This fact notwithstanding' and despite the 1(&. court order' the ;antos heirs remained unpaid' and no action was ta$en on their case until 1A ;eptember 1((( when petitioner filed its manifestation and motion to permit the deposit in court of the amount of !.'AA.'"""."" by way of +ust compensation for the expropriated property of the late <uis ;antos sub+ect to such final computation as might be appro ed by the court. This time' the ;antos heirs' opposing the manifestation and motion' submitted a counterFmotion to ad+ust the compensation from !A."" per s#uare meter pre iously fixed in the 1(1( decision to its current 6onal aluation pegged at !%'"""."" per s#uare meter or' in the alternati e' to cause the return to them of the expropriated property. On 31 M'r$! .333, !e /ul'$'n RTC rule+ #n ('vor o( re)"on+en ) 'n+ #))ue+ !e '))'#le+ or+er, v'$' #ng # ) +e$#)#on o( .6 Fe5ru'r% 1:4: 'n+ +e$l'r#ng # o 5e unen(or$e'5le on !e groun+ o( "re)$r#" #on ; The ubi#uitous character of eminent domain is manifest in the nature of the expropriation proceedings. 4xpropriation proceedings are not ad ersarial in the con entional sense' for the condemning authority is not re#uired to assert any conflicting interest in the property. Thus' by filing the action' the condemnor in effect merely ser es notice that it is ta$ing title and possession of the property' and the defendant asserts title or interest in the property' not to pro e a right to possession' but to pro e a right to compensation for the ta$ing.P( /b iously' howe er' the power is not without its limits2 first' the ta$ing must be for public use' and second' that +ust compensation must be gi en to the pri ate owner of the property.P1" These twin proscriptions ha e their origin in the recognition of the necessity for achie ing balance between the ;tate interests' on the one hand' and pri ate rights' upon the other hand' by effecti ely restraining the former and affording protection to the latter.P11 In +e erm#n#ng "u5l#$ u)e' two approaches are utili6ed F the first is public employment or the actual use by the public' and the second is public ad antage or benefit.P1- It is also useful to iew the matter as being sub+ect to constant growth' which is to say that as society ad ances' its demands upon the indi idual so increases' and each demand is a new use to which the resources of the indi idual may be de oted.P1= The expropriated property has been shown to be for the continued utili6ation by the !IA' a significant portion thereof being ceded for the expansion of the facilities of the )ulacan ;tate Lni ersity and for the propagation of the !hilippine carabao' themsel es in line with the re#uirements of public purpose. @espondents #uestion the public nature of the utili6ation by petitioner of the condemned property' pointing out that its present use differs from the purpose originally contemplated in the !"#" e propriation proceedings . The argument is of no moment. The property has assumed a public character upon its expropriation. ;urely' Petitioner$ as the condemnor and as the owner of the property$ is well within its rights to alter and decide the use of that property$ the only limitation being that it be for public use$ which$ decidedly$ it is% The constitutional limitation of +ust compensation is considered to be the sum e#ui alent to the mar$et alue of the property' broadly

Course Outline Constitutional Law II described to be the price fixed by the seller in open mar$et in the usual and ordinary course of legal action and competition or the fair alue of the property as between one who recei es' and one who desires to sell' it fixed at the time of the actual ta$ing by the go ernment.P-% Thus' if property is ta$en for public use before compensation is deposited with the court ha ing +urisdiction o er the case' the final compensation must include interests on its +ust alue to be computed from the time the property is ta$en to the time when compensation is actually paid or deposited with the court.P-A In fine' between the ta$ing of the property and the actual payment' legal interests accrue in order to place the owner in a position as good as (but not better than) the position he was in before the ta$ing occurred.P-1 W?EREFORE' the petition is D@ANT4,. The resolution' dated =1 0uly -"""' of the 3ourt of Appeals dismissing the petition for certiorari'as well as its resolution of ". 0anuary -""1 denying the motion for reconsideration' and the decision of the @egional Trial 3ourt of )ulacan' dated "1 7arch -"""' are ;4T A;I,4. <et the case be forthwith remanded to the @egional Trial 3ourt of )ulacan for the proper execution of its decision promulgated on -A ?ebruary 1(1( which is hereby @4IN;TAT4,. No costs. ;/ /@,4@4,.

when property has been wrongfully ta$en or is wrongfully retained by one claiming to act under the power of eminent domain 1( or 6!ere ' r#g! (ul en r% #) m'+e 'n+ !e "'r % $on+emn#ng re(u)e) o "'% !e $om"en)' #on 6!#$! !') 5een '))e))e+ or 'gree+ u"onI -" or fails or refuses to ha e the compensation assessed and paid /ne of the basic principles enshrined in our 3onstitution is that no person shall be depri ed of his pri ate property without due process of law> and in expropriation cases' an essential element of due process is that there must be +ust compensation whene er pri ate property is ta$en for public use. Accordingly' ;ection (' Article III' of our 3onstitution mandates2 *Private property shall not %e ta en for pu%lic use &ithout 'ust compensation.* ;ignificantly' the pro ision of ;ection (' Article III of the 3onstitution is not a grant but a l#m# ' #on of power. This limiting function is in $eeping with the philosophy of the )ill of @ights against the arbitrary exercise of go ernmental powers to the detriment of the indi idualEs rights. Di en this function' the pro ision should therefore be ) r#$ l% interpreted against the expropriator' the go ernment' and l#5er'll% in fa or of the property owner. T!e r#g! $over) !e "er)onC) l#(e, !#) l#5er % 'n+ !#) "ro"er % un+er Se$ #on 1 o( Ar #$le III o( !e Con) # u #on. W# ! reg'r+ o !#) "ro"er %, !e o6ner en,o%) !e '++e+ "ro e$ #on o( Se$ #on :, 6!#$! re'((#rm) !e ('m#l#'r rule !' "r#v' e "ro"er % )!'ll no 5e '7en (or "u5l#$ u)e 6# !ou ,u) $om"en)' #on.while the pre ailing doctrine is !' - !e non;"'%men o( ,u) $om"en)' #on +oe) no en # le !e "r#v' e l'n+o6ner o re$over "o))e))#on o( !e e&"ro"r#' e+ lo ), !o6ever, #n $')e) 6!ere !e governmen ('#le+ o "'% ,u) $om"en)' #on 6# !#n (#ve @5J.4 %e'r) (rom !e (#n'l# % o( !e ,u+gmen #n !e e&"ro"r#' #on "ro$ee+#ng), !e o6ner) $on$erne+ )!'ll !'ve !e r#g! o re$over "o))e))#on o( !e#r "ro"er %. This is in consonance with the principle that *the go ernment cannot $eep the property and dishonor the +udgment.* To be sure' the fi eFyear period limitation will encourage the go ernment to pay +ust compensation punctually. This is in $eeping with +ustice and e#uity. After all' it is the duty of the go ernment' whene er it ta$es property from pri ate persons against their will' to facilitate the payment of +ust compensation. In !osculluela v. !ourt of Appeals we defined +ust compensation as not only the correct determination of the amount to be paid to the property owner but also the payment of the property within a re')on'5le #me. Cithout prompt payment' compensation cannot be considered *+ust. 1:. SMIT? B<INE D FRENC? <A/ORATORIES, <TD. v). CA, G.R. No. 1.1.64 ?acts2 1. !etitioner is the assignee of <etters !atent No. 1--"1 co ering the pharmaceutical product !imetidine' which relates to deri ati es of heterocyclicthio or lower al$oxy or amino lower al$yl thiourea' ureas or guanadines. ;aid patent was issued by the )!TTT to Draham 0ohn ,urant'

12. Re"u5l#$ v. <#m, G.R. No. 161656, 1une .:, .335 /n ;eptember %' 1(=&' the @epublic of the !hilippines (@epublic) instituted a special ci il action for expropriation with the 3ourt of ?irst Instance (3?I) of Ce5u, (or !e "ur"o)e o( e) '5l#)!#ng ' m#l# 'r% re)erv' #on (or !e P!#l#""#ne Arm% . <ot (=- was registered in the name of Der asia ,en6on' while <ot (=( was in the name of 4ulalia ,en6on ?or failure of the @epublic to pay for the lots' on ;eptember -"' 1(A1' the ,en6onsE successorsFinFinterest' Fr'n$#)$' G'leo);A'l+e!ue*' 'n+ 1o)e(#n' G'leo);P'ner#o'- filed with the same 3?I an action for reco ery of possession with damages against the @epublic and officers of the Armed ?orces of the !hilippines in possession of the property. 7eanwhile' in 1(A.' Haldehue6a and !anerio mortgaged <ot (=- to A#$en e <#m' herein respondent'. as security for their loans. ?or their failure to pay <im despite demand' he had the mortgage foreclosed in 1(1A. The @epublic now argues that under #aldehue$a' respondent is not entitled to reco er possession of <ot (=- but only to demand payment of its fair mar$et alue. WGN re)"on+en m'% re$over "o))e))#on o( lo :9.H :es 'It bears stressing that the @epublic was ordered to pay +ust compensation 6#$e' the first was in the expropriation proceedings and the second' in #aldehue$a. ?iftyFse en (%1) years ha e passed since then. We $'nno 5u $on) rue !e Re"u5l#$C) ('#lure o "'% ,u) $om"en)' #on ') ' +el#5er' e re(u)'l on # ) "'r . Lnder such circumstance' re$over% o( "o))e))#on is in order. In se eral +urisdictions' the courts held that reco ery of possession may be had

Course Outline Constitutional Law II 0ohn 3ollin 4mmett and @obin Denellin on No ember -(' 1(1&. -. /n August -1' 1(&(' pri ate respondent filed with the )!TTT a petition for compulsory license to manufacture and produce its own brand of medicines using !imetidine. !ri ate respondent in o$ed ;ection =. (1) (e) of @epublic Act No. 1A%' (the !atent <aw) the law then go erning patents' which states that an application for the grant of a compulsory license under a particular patent may be filed with the )!TTT at any time after the lapse of two (-) years from the date of grant of such patent' if the patented in ention or article relates to food or medicine' or manufactured substances which can be used as food or medicine' or is necessary for public health or public safety. The petition for compulsory license stated that !imetidine is useful as an antihistamine and in the treatment of ulcers' and that pri ate respondent is capable of using the patented product in the manufacture of a useful product. !etitioner opposed the petition for compulsory license' arguing that the pri ate respondent had no cause of action and failed to allege how it intended to wor$ the patented product. !etitioner further stated that its manufacture' use and sales of !imetidine satisfied the needs of the !hilippine mar$et' hence' there was no need to grant a compulsory license to pri ate respondent to manufacture' use and sell the same. ?inally' petitioner also claimed that the grant of a compulsory license to pri ate respondent would not promote public safety and that the latter was only moti ated by pecuniary gain. )!TTT rendered a decision directing the issuance of a compulsory license to pri ate respondent to use' manufacture and sell in the !hilippines its own brand of pharmaceutical products containing !imetidine and ordered the payment by pri ate respondent to petitioner of royalties at the rate of -.%O of net sales in !hilippine currency. !etitioner thereafter filed with the 3ourt of Appeals and subse#uently denied the petition for re iew of the decision of the )!TTT' raising the following arguments2 A. (1) the )!TTTEs decision is iolati e of the !aris 3on ention for the !rotection of Industrial !roperty> (-) said decision is an in alid exercise of police power>

).

3. (=) the rate of royalties payable to petitioner as fixed by the )!TTT was rendered without factual basis and amounts to an expropriation of pri ate property without +ust compensation> ,. (.) the petition for compulsory license should ha e been dismissed by the )!TTT for failure to pro e the +urisdictional re#uirement of publication. Issue2 C8N 3A gra ely abused its discretion denying the petitions on the ground cited abo e9 @uling' No' ;3 held that the grant of a compulsory license to pri ate respondent for the manufacture and use of !imetidine is in accord with the !atent <aw since the patented product is medicinal in nature' and therefore necessary for the promotion of public health and safety. It explained further that the pro isions of the !atent <aw permitting the grant of a compulsory license are intended not only to gi e a chance to others to supply the public with the #uantity of the patented article but especially to pre ent the building up of patent monopolies. Neither did the appellate court find the royalty rate of -.%O of net sales fixed by the )!TTT unreasonable' considering that what was granted under the compulsory license is only the right to manufacture !imetidine' without any technical assistance from petitioner' and royalty rates identical to that fixed by the )!TTT ha e been prescribed for the grant of compulsory license in a good number of patent cases. Chile petitioner concedes that the ;tate in the exercise of police power may regulate the manufacture and use of medicines through the enactment and implementation of pertinent laws' it states that such exercise is alid only if the means employed are reasonably necessary for the accomplishment of the purpose and if not unduly oppressi e. There is li$ewise no basis for the allegation that the grant of a compulsory license to pri ate respondent results in the depri ation of petitionerEs property without +ust compensation. I mu) 5e "o#n e+ ou !' ') o6ner o( <e er) P' en No. 1..34, "e # #oner !'+ 'lre'+% en,o%e+ e&$lu)#ve r#g! ) o m'nu('$ ure, u)e 'n+ )ell

=.

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Course Outline Constitutional Law II &imetidine (or ' le') 6o %e'r) (rom # ) gr'n #n Novem5er, 1:42. Even #( o !er en # #e) l#7e "r#v' e re)"on+en 're )u5)e8uen l% 'llo6e+ o m'nu('$ ure, u)e 'n+ )ell !e "' en e+ #nven #on 5% v#r ue o( ' $om"ul)or% l#$en)e, "e # #oner ') o6ner o( !e "' en 6oul+ ) #ll re$e#ve remuner' #on (or !e u)e o( )u$! "ro+u$ #n !e (orm o( ro%'l #e). The 3ourt of Appeals correctly held that the rate of -.%O of net wholesale price fixed by the ,irector of the )!TTT is in accord with the !atent <aw. ;aid law pro ides2 ;ec. =%. (rant of License.)(1) If the ,irector finds that a case for the grant of a license under ;ection =. hereof has been made out' he shall' within one hundred eighty days from the date the petition was filed' order the grant of an appropriate license. The order shall state the terms and conditions of the license which he himself must fix in default of an agreement on the matter manifested or submitted by the parties during the hearing.x x x (=) A compulsory license shall only be granted sub+ect to the payment of ade#uate royalties commensurate with the extent to which the in ention is wor$ed. Howe er' royalty payments shall not exceed fi e percent (%O) of the net wholesale price (as defined in ;ection ==FA) of the products manufactured under the license. If the product' substance' or process sub+ect of the compulsory license is in ol ed in an industrial pro+ect appro ed by the )oard of In estments' the royalty payable to the patentee or patentees shall not exceed three percent (=O) of the net wholesale price (as defined in ;ection ==FA) of the patented commodity8and or commodity manufactured under the patented process> the same rate of royalty shall be paid whene er two or more patents are in ol ed> which royalty shall be distributed to the patentees in rates proportional to the extent of commercial use by the licensee gi ing preferential alues to the holder of the oldest subsisting product patent. .3. A))o. O( Sm'll <'n+o6ner) v. Se$re 'r% o( DAR, 145 SCRA 949 ?acts2 - In $eeping with the policy of the 3onstitution to pro ide for an agrarian reform program aimed at emancipating the tenant from the bondage of soil' !resident A#uino issued se eral laws that pro ided for the ac#uisition of pri ate lands for distribution among tenantFfarmers and which specified the maximum retention limits for landowner (in line with !, -1 of 7arcos). o 4/ --& K declaring full landownership in fa or of the tenant farmers and pro iding for the aluation of still un alued lands as well as the manner of payment. o !residential !roclamation No. 1=1 K instituted a comprehensi e agrarian reform program. o 4/ --( K pro ided for the mechanics for the implementation of the comprehensi e agrarian reform program. ?inally' the 3ongress enacted the 3omprehensi e Agrarian @eform law of 1(&& (@A AA%1> 3A@! law)' in $eeping with the earlier issuances of the !resident. The petitioners #uestion the constitutionality of the 3A@! <aw' claiming that it is not a alid exercise of the power of eminent domain' including in their arguments2

That the ;tate should first distribute the public agricultural lands in the pursuit of agrarian reform instead of immediately disturbing property rights by forcibly ac#uiring pri ate agricultural lands. o That the manner of fixing the +ust compensation is entrusted to the administrati e authorities in iolation of +udicial prerogati es. o That it re#uires the owners to accept compensation for the properties in a mode less than money which is the only medium of payment allowed. o That the landowner is di ested of his property e en before the actual payment to him in full +ust compensation. Issue2 Chether the 3A@! <aw (@A AA%1) is a alid exercise of eminent domain and therefore' constitutional. @uling2 - :es. The 3A@! law' satisfying the re#uirements of public use and +ust compensation' is a alid exercise of the stateEs inherent power of eminent domain and hence' constitutional. - 4minent domain K the inherent power of the ;tate that enables it to forcibly ac#uire pri ate lands intended for public use upon payment of +ust compensation to the owner. o Chere the owner is willing to sell under terms also acceptable to the purchaser' there is no need for expropriation and such would be considered an ordinary deed of sale. o Onl% 6!ere !e o6ner #) un6#ll#ng o )ell, or $'nno '$$e" !e "r#$e or o !er $on+# #on) o((ere+ 5% !e ven+ee, !' !e "o6er o( em#nen +om'#n 6#ll $ome #n o "l'% o '))er !e "'r'moun 'u !or# % o( !e S ' e over !e #n ere) ) o( !e "ro"er % o6ner. - - @e#uirements for a alid exercise of the power of eminent domain2 o !ublic use o 0ust compensation K !e (ull 'n+ ('#r e8u#v'len o( !e "ro"er % '7en (rom # ) o6ner 5% !e e&"ro"r#' or. Me')ure #) no !e '7erC) g'#n 5u !e o6nerC) lo)). 4#ui alent to be rendered for the property to be ta$en shall be real' substantial' full' ample. - 3onditions for 3ompensable ta$ing2 o 4xpropriator must enter a pri ate property> o 4ntry must be for more than a momentary period> o 4ntry must be under warrant or color of legal authority o !roperty must be de oted to public use or otherwise informally appropriated or in+uriously affected> and o Ltili6ation of the property for public use must be in such a way as to oust the owner and depri e him of beneficial en+oyment of the property. - In the case' the decision to redistribute pri ate agricultural lands in the manner prescribed by the 3A@! was made by o

Course Outline Constitutional Law II the legislati e and executi e departments in the exercise of discretion K a political #uestion which the +udiciary may not re iew in the absence of showing that it has been abused. - The 3A@! law has already complied with the first re#uirement of public use' considering that that the institution of an agrarian reform program has been mandated in the 3onstitution (Art. 1=' ;ec. .). - Cith regard to the re#uirement of +ust compensation' ;ec. 1A(d) of the 3A@! <aw' which pro ides for the ,A@ to conduct summary administrati e proceedings to determine +ust compensation' is not arbitrary' since the landowner is allowed opportunity to submit e idence on the real alue of the property. o ;ec. 1A (f) also pro ides for right of the courts of +ustice to re iew compensation pro ided. o ,etermination of +ust compensation is a function of the courts of +ustice. - The traditional medium of payment for +ust compensation is money and no other' howe er' as mu$! ') !e CARP l'6 "rov#+e) (or o !er mo+e) o( "'%men @)u$! ') )!'re) o( ) o$7, </P 5on+), o !er "ro"er #e) or '))e ), '& $re+# ), 'n+ o !er !#ng o( v'lueJ, # #) ) #ll $on)#+ere+ ') v'l#+, )#n$e !e CARP l'6 #) $on)#+ere+ o 5e ' revolu #on'r% 7#n+ o( e&"ro"r#' #on. o 3onsidering the ast land areas sub+ect to expropriation under the sub+ect laws' it is estimated that hundreds of billions of pesos will be needed' which is not e en fully a ailable at this time. o It is therefore' assumed that the framers intended to allow such manner of payments as is pro ided in the 3A@! law. - ?inally' it is a recogni6ed rule that title to the property expropriated shall pass from the owner to the expropriator only upon full payment of +ust compensation. o Gennedy . Indianapolis2 @ight to enter on and use the property is complete' as soon as the property is actually appropriated under the authority of law for a public use' but that the title does not pass from the owner without his consent' until +ust compensation has been made to him. o The 3A@! law conditions the transfer of possession and ownership of the land to the go ernment on receipt by the landowner of the corresponding payment or the deposit by the ,A@ of the compensation in cash or <)! bands with an accessible ban$ K until then' title also remains with the landowner. .1. S '. Ro)' Re'l % 'n+ Dev . Cor". v. CA, G.R. No. 11.5.6, O$ . 1., .331 !etitioner ;ta. @osa @ealty ,e elopment 3orporation (;@@,3) was the registered owner of two parcels of land in <aguna. According to petitioner' the parcels of land are 6' er)!e+), 6!#$! "rov#+e $le'n "o '5le 6' er o !e C'nlu5'ng $ommun# %' and that ninety ((") light industries are now located in the area. !etitioner alleged that respondents usurped its rights o er the property' thereby destroying the ecosystem.

@espondents filed a ci il case with 'T& seeking an easement of a right of way to and from Barangay &asile. )y way of counterclaim' howe er' petitioner sought the e+ectment of pri ate respondents. !etitioner filed with the 7T3 separate complaints for forcible entry against respondents. After the filing of the e+ectment cases' re)"on+en ) "e # #one+ !e De"'r men o( Agr'r#'n Re(orm @DARJ (or !e $om"ul)or% '$8u#)# #on o( !e SRRDC "ro"er % un+er !e CARP. !etitioner filed with the 7unicipal Agrarian @eform /ffice (7A@/)' 3abuyao' <aguna a I!rotest and /b+ectionJ to the compulsory ac#uisition of the "ro"er % on !e groun+ !' !e 're' 6') no '""ro"r#' e (or 'gr#$ul ur'l "ur"o)e). The area was rugged in terrain with slopes of 1&O and abo e and that the occupants of the land were s#uatters' who were not entitled to any land as beneficiaries. The farmer beneficiaries together with the )A@3 chairman answered the protest and ob+ection stating that the slope of the land is not 1&O but only %F1"O and that the land is suitable and economically iable for agricultural purposes' as e idenced by the 3ertification of the ,epartment of Agriculture' municipality of 3abuyao' <aguna. ,A@A) promulgated a decision ordering <)! to pay ;ta. @osa @ealty ,e elopment 3orporation the amount of !1'&.1'((1.A. for its landholdings co ered by the two (-) Transfer 3ertificates of Title mentioned abo e. !etitioner filed with the 3ourt of Appeals a petition for re iew of the ,A@A) decision. /n No ember %' 1((=' the 3ourt of Appeals promulgated a decision affirming the decision of ,A@A). I))ue> W!e !er !e "ro"er % #n 8ue) #on #) $overe+ 5% CARP +e)"# e !e ('$ !' !e en #re "ro"er % (orme+ "'r o( ' 6' er)!e+ 're' "r#or o !e en'$ men o( R. A. No. 6654 @uling2 Article A1 of the Cater 3ode of the !hilippines (!. ,. No. 1"A1) pro ides2 IArt. A1. Any watershed or any area of land ad+acent to any surface water or o erlying any ground water may be declared by the ,epartment of Natural resources as a protected area. @ules and @egulations may be promulgated by such ,epartment to prohibit or control such acti ities by the owners or occupants thereof within the protected area which may damage or cause the deterioration of the surface water or ground water or interfere with the in estigation' use' control' protection' management or administration of such waters.J 3learing and tilling of the lands are totally inconsistent with sound watershed management. 7ore so' the introduction of earth disturbing acti ities li$e road building and erection of permanent infrastructures. Lnless the pernicious agricultural acti ities of the 3asile farmers are immediately stopped' it would not be long before these watersheds would cease to be of alue. T!e #m"'$ o( 6' er)!e+ +egre+' #on !re' en) !e l#vel#!oo+ o( !ou)'n+) o( "eo"le +e"en+en u"on # . Toward this' we hope that an acceptable comprehensi e watershed de elopment policy and program be immediately fformulated and implemented before the irre ersible damage finally happens. !etitioner presented proof that the 3asile property has slopes of 1&O and o er' which exempted the land from the co erage of 3A@<. @. A. No. AA%1' ;ection 1"' pro ides2

Course Outline Constitutional Law II I;ection 1". 4xemptions and 4xclusions. K <ands actually' directly and exclusi ely used and found to be necessary for par$s' wildlife' forest reser es' reforestration' fish sanctuaries and breeding grounds' watersheds and mangro es' national defense' school sites and campuses including experimental farm stations operated by public or pri ate schools for educational purposes' seeds and seedlings research and pilot production centers' church sites and con ents appurtenent thereto' communal burial grounds and cemeteries' penal colonies and penal farms actually wor$ed by the inmates' go ernment and pri ate research and #uarantine centers' and all lands with eighteen percent (1&O) slope and o er' except those already de eloped shall be exempt from co erage of this Act.J The 3ourt ;4T; A;I,4 the decision of the 3ourt of Appeals. In lieu thereof' the 3ourt @47AN,; the case to the ,A@A) for reF e aluation and determination of the nature of the parcels of land in ol ed to resol e the issue of its co erage by the 3omprehensi e <and @eform !rogram. ... Co)$ulluel' v. CA, e . 'l. , G.R. No. <;44465. Augu) 15, 1:22 ?A3T;2 !roperty of !etitioner was expropriated properly complying with the procedural re#uirement. Howe er' the Do ernment has yet to pay the +ust compensation for such expropriation. !ayment for the land sei6ed was delayed for more than 1" years. The go ernment says that it cannot release public funds unless the congress enacts an appropriations act for the disbursement of such funds. I;;L42 Chat constitutes +ust compensation9 H4<,2 0ust compensation means not only the correct determination of the amount to be paid to the owner of the land but also the payment of the land within a reasonable time from its ta$ing. The go ernment says that it cannot release public funds unless the congress enacts an appropriations act for the disbursement of such funds. Howe er' the ;3 stated that in the present case' the pro+ect was a pac$age pro+ect of the go ernment. 7oney was allocated for an entire pro+ect. )efore millions of pesos were put into the de elopment of the pro+ect' the basic responsibility of paying the owners for property sei6ed from them should ha e been met.

!etitioner ,A@ maintains that *the deposit contemplated by ;ection 1A(e) of @epublic Act AA%1' absent any specific indication' may either be general or special' regular or irregular' oluntary or in oluntary (necessary) or other forms $nown in law' and any thereof should be' as it is the general rule' deemed complying.* P-Q Ce re+ect this contention. ;ection 1A(e) of @epublic Act AA%1 was ery specific in limiting the type of deposit to be made as compensation for the re+ecting landowners' that is in *cash* or in *<)! bonds. The pro ision is ery clear and unambiguous' foreclosing any doubt as to allow an expanded construction that would include the opening of *trust accounts* within the co erage of term *deposit.J Accordingly' we must adhere to the wellFsettled rule that when the law spea$s in clear and categorical language' there is no reason for interpretation or construction' but only for application. P=Q Thus' recourse to any rule which allows the opening of trust accounts as a mode of deposit under ;ection 1A(e) of @.A. AA%1 goes beyond the scope of the said pro ision and is therefore impermissible. As we ha e pre iously declared' the ruleFma$ing power must be confined to details for regulating the mode or proceedings to carry into effect the law as it has been enacted' and it cannot be extended to amend or expand the statutory re#uirements or to embrace matters not co ered by the statute.P.Q Administrati e regulations must always be in harmony with the pro isions of the law because any resulting discrepancy between the two will always be resol ed in fa or of the basic law.P%Q The alidity of constituting trust accounts for the benefit of the re+ecting landowners and withholding immediate payment to them is further premised on the latterMs refusal to accept the offered compensation thereby ma$ing it necessary that the amount remains in the custody of the <)! for safe$eeping and in trust for e entual payment to the landowners.PAQ Additionally' it is argued that the release of the amount deposited in trust prior to the final determination of the +ust compensation would be premature and expose the go ernment to unnecessary ris$s and disad antages' citing the possibility that the go ernment may subse#uently decide to abandon or withdraw from the co erage of the 3A@! certain portions of the properties that it has already ac#uired' through super ening administrati e determination that the sub+ect land falls under the exempt category' or by subse#uent legislation allowing additional exemptions from the co erage' or e en the total scrapping of the program itself. *orce ma'eure is also contemplated in iew of the de astation suffered by 3entral <u6on de to lahar. !etitioner ,A@ maintains that under these conditions' the go ernment will be forced to institute numerous actions for the reco ery of the amounts that it has already paid in ad ance to the re+ecting landowners. P1Q Ce are not persuaded. As an exercise of police power' the expropriation of pri ate property under the 3A@! puts the landowner' and not the go ernment' in a situation where the odds are already stac$ed against his fa or. He has no recourse but to allow it. His only consolation is that he can negotiate for the amount of compensation to be paid for the expropriated property. As expected' the landowner will exercise this right to the hilt' but sub+ect howe er to the limitation that he can only be entitled to a *+ust compensation.* 3learly therefore' by re+ecting and disputing the aluation of the ,A@'

.9. <AND /ANB OF T?E P?I<IPPINES v. CA FACTS> 3onse#uent to the denial of their petitions for re iew on certiorari by this 3ourt on /ctober A' 1((% P1Q' petitioners ,epartment of Agrarian @eform (,A@) and <and )an$ of the !hilippines (<)!)' filed their respecti e motions for reconsideration contending mainly that' contrary to the 3ourtMs conclusion' the opening of trust accounts in fa or of the re+ecting landowners is sufficient compliance with the mandate of @epublic Act AA%1. 7oreo er' it is argued that there is no legal basis for allowing the withdrawal of the money deposited in trust for the re+ecting landowners pending the determination of the final aluation of their properties.

Course Outline Constitutional Law II the landowner is merely exercising his right to see$ +ust compensation. If we are to affirm the withholding of the release of the offered compensation despite depri ing the landowner of the possession and use of his property' we are in effect penali6ing the latter for simply exercising a right afforded to him by law. /b iously' this would render the right to see$ a fair and +ust compensation illusory as it would discourage owners of pri ate lands from contesting the offered aluation of the ,A@ e en if they find it unacceptable' for fear of the hardships that could result from long delays in the resolution of their cases. This is contrary to the rules of fair play because the concept of +ust compensation embraces not only the correct determination of the amount to be paid to the owners of the land' but also the payment of the land within a reasonable time from its ta$ing. Cithout prompt payment' compensation cannot be considered *+ust* for the property owner is made to suffer the conse#uence of being immediately depri ed of his land while being made to wait for a decade or more before actually recei ing the amount necessary to cope with his loss. P&Q It is significant to note that despite petitionerMs ob+ections to the immediate release of the re+ected compensation' petitioner <)!' ta$ing into account the plight of the re+ecting landowners' has ne ertheless allowed partial withdrawal through <)! 4xecuti e /rder No. ""=' P(Q limited to fifty (%") per cent of the net cash proceeds. This is a clear confirmation that petitioners themsel es reali6e the o erriding need of the landownersM immediate access to the offered compensation despite re+ecting its aluation. )ut the effort' though laudable' still falls short because the release of the amount was unexplainably limited to only fifty per cent instead of the total amount of the re+ected offer' notwithstanding that the re+ecting landownerMs property is ta$en in its entirety. The apprehension against the total release of the re+ected compensation is discounted since the go ernmentMs interest is amply protected under the aforementioned payment scheme because among the conditions already imposed is that the landowner must execute a ,eed of 3onditional Transfer for the sub+ect property. P1"Q Anent the aforecited ris$s and disad antages to which the go ernment allegedly will be unnecessarily exposed if immediate withdrawal of the re+ected compensation is allowed' suffice it to say that in the absence of any substantial e idence to support the same' the contemplated scenarios are at the moment nothing but speculations. To allow the ta$ing of the landownersM properties' and in the meantime lea e them empty handed by withholding payment of compensation while the go ernment speculates on whether or not it will pursue expropriation' or worse for go ernment to subse#uently decide to abandon the property and return it to the landowner when it has already been rendered useless by force ma'eure' is undoubtedly an oppressi e exercise of eminent domain that must ne er be sanctioned. <egislations in pursuit of the agrarian reform program are not mere o ernight creations but were the result of long exhausti e studies and e en heated debates. In implementation of the program' much is therefore expected from the go ernment. Lnduly burdening the property owners from the resulting flaws in the implementation of the 3A@! which was supposed to ha e been a carefully crafted legislation is plainly unfair and unacceptable. W?EREFORE' in iew of the foregoing' petitionersM motions for reconsideration are hereby ,4NI4, for lac$ of merit.

SO ORDERED. .4. Ag'n, e . 'l. v. PIATCO, e . 'l., G.R. No. 155331, M'% 5, .339 !etitioners filed the instant petitions for prohibition under @ule A% of the @e ised @ules of 3ourt see$ing to prohibit the 7anila International Airport Authority (7IAA) and the ,epartment of Transportation and 3ommunications (,/T3) and its ;ecretary from implementing the following agreements executed by the !hilippine Do ernment through the ,/T3 and the 7IAA and the !hilippine International Air Terminals 3o.' Inc. (!IAT3/)2 (1) the 3oncession Agreement signed on 0uly 1-' 1((1' Article H' ;ection %.1" (c) of the 1((1 3oncession Agreement pro ides2 ;ection %.1" Temporary Ta$eFo er of operations by D@!. xxxCon$e))#on'#re )!'ll 5e en # le+ o re')on'5le $om"en)' #on (or !e +ur' #on o( !e em"or'r% '7e over 5% GRP, 6!#$! $om"en)' #on )!'ll '7e #n o '$$oun !e re')on'5le $o) (or !e u)e o( !e Term#n'l 'n+Gor Term#n'l Com"le&, @6!#$! #) #n !e 'moun ' le') e8u'l o !e +e5 )erv#$e re8u#remen ) o( Con$e))#on'#re.&&& C8N the 3oncession Agreement signed on 0uly 1-' 1((1 constitutional9 No' it was unconstitutional' thus null and oid Article RII' ;ection 11 of the 1(&1 3onstitution pro ides2 ;ection 11. In times of national emergency' when the public interest so re#uires' the ;tate may' during the emergency and under reasonable terms prescribed by it' temporarily ta$e o er or direct the operation of any pri ately owned public utility or business affected with public interest. The abo e pro ision pertains to the right of the ;tate in times of national emergency' and in the exercise of its police power' to temporarily ta$e o er the operation of any business affected with public interest. In the 1(&A 3onstitutional 3ommission' the term *national emergency* was defined to include threat from external aggression' calamities or national disasters' but not stri$es *unless it is of such proportion that would paraly6e go ernment ser ice.*The duration of the emergency itself is the determining factor as to how long the temporary ta$eo er by the go ernment would last. The temporary ta$eo er by the go ernment extends only to the operation of the business and not to the ownership thereof. As such the governmen #) no re8u#re+ o $om"en)' e !e "r#v' e en # %; o6ner o( !e )'#+ 5u)#ne)) ') !ere #) no r'n)(er o( o6ner)!#", whether permanent or temporary. The pri ate entityFowner affected by the temporary ta$eo er cannot' li$ewise' claim +ust compensation for the use of the said business and its properties as the temporary ta$eo er by the go ernment is in exercise of its "ol#$e "o6er and not of its power of eminent domain. PIATCO $'nno , 5% mere $on r'$ u'l ) #"ul' #on, $on r'vene !e Con) # u #on'l "rov#)#on on em"or'r% governmen '7eover 'n+ o5l#g' e !e governmen o "'% -re')on'5le $o) (or !e u)e o(

Course Outline Constitutional Law II !e Term#n'l 'n+Gor Term#n'l Com"le&.- Article RII' section 11 of the 1(&1 3onstitution en isions a situation wherein the exigencies of the times necessitate the go ernment to *temporarily ta$e o er or direct the operation of any pri ately owned public utility or business affected with public interest.* It is the welfare and interest of the public which is the paramount consideration in determining whether or not to temporarily ta$e o er a particular business. 3learly' the ;tate in effecting the temporary ta$eo er is exercising its police power. !olice power is the *most essential' insistent' and illimitable of powers.*Its exercise therefore must not be unreasonably hampered nor its exercise be a source of obligation by the go ernment in the absence of damage due to arbitrariness of its exercise. Thus' re#uiring the go ernment to pay reasonable compensation for the reasonable use of the property pursuant to the operation of the business contra enes the 3onstitution .5. DIDIPIO EART?;SAAERSL MF<TI;PFRPOSE ASSOCIATION, v). GOMFN, F'$ )> 1. In 1(&1' 3ory promulgated 4/ -1( which empowered ,4N@ to stipulate with foreign companies when it comes to either technical or financial large scale exploration or mining. -. In 1((%' @amos signed into law @A 1(.- or the !hilippine 7ining Act. Howe er' in 1((.' @amos already signed an ?TAA with Arimco 7ining 3o' an Australian company which authori6ed A73 (later 3A73) to explore =1'""" hectares of land in 5uirino and N. Hi6caya including )rgy ,idipio. After the passage of the law' ,4N@ promulgated out its I@@s. ,idipio petitioned to ha e the law and the I@@ to be annulled as it is unconstitutional and it constitutes unlawful ta$ing of property. !etitioners contends that ;ection 1A of @ep. Act No. 1(.- and ;ection 1"1 of ,A/ (AF." which they claim allow the unlawful and un+ust Ita$ingJ of pri ate property for pri ate purpose in contradiction with ;ection (' Article III of the 1(&1 3onstitution mandating that pri ate property shall not be ta$en except for public use and the corresponding payment of +ust compensation. They further claim that public respondent ,4N@' through the 7ining Act and its Implementing @ules and @egulations' cannot' on its own' permit entry into a pri ate property and allow ta$ing of land without payment of +ust compensation.

%.

Howe er' respondents argue that ;ection 1A is not a ta$ing pro ision but a alid exercise of the police power and by irtue of which' the state may prescribe regulations to promote the health' morals' peace' education' good order' safety and general welfare of the people. This go ernment regulation in ol es the ad+ustment of rights for the public good and that this ad+ustment curtails some potential for the use or economic exploitation of pri ate property. !ublic respondents concluded that Ito re#uire compensation in all such circumstances would compel the go ernment to regulate by purchase.J

ISSFE> Chether or not @A 1(.- and the ,4N@ I@@s are alid. Rul#ng> The ;3 ruled against ,idipio. The ;3 noted the re#uisites of eminent domain. They are> (1) the expropriator must enter a pri ate property> (-) the entry must be for more than a momentary period. (=) the entry must be under warrant or color of legal authority> (.) the property must be de oted to public use or otherwise informally appropriated or in+uriously affected> (%)the utili6ation of the property for public use must be in such a way as to oust the owner and depri e him of beneficial en+oyment of the property. ,idipio failed to show that the law is in alid. As pro ided in ;ec 1A of @A 1(.- pro ides for +ust compensation as well as section 1"1 of the ,4N@ @@. ;ection 1A. xxx !ro ided' that any damage to the property of the surface owner' occupant' or concessionaire as a conse#uence of such operations shall be properly compensated as may be pro ided for in the implementing rules and regulations. ;ection 1"1. 3ompensation of the ;urface /wner and /ccupantF Any damage done to the property of the surface owners' occupant' or concessionaire thereof as a conse#uence of the mining operations or as a result of the construction or installation of the infrastructure mentioned in 1". abo e shall be properly and +ustly compensated.

=.

..

Course Outline Constitutional Law II Hence' !etition was dismissed @A 1(.- and its I@@ are not unconstitutional. .6. REPF/<IC OF T?E P?I<IPPINES, e . 'l. v). GINGONON, e . 'l., ?acts2 The Ninoy A#uino International Airport !assenger Terminal III (NAIA =) was constructed through a contract for )uildF /perateFandFTransfer between the Do ernment and the !hilippine International Air Terminals 3o.' Inc. (!IAT3/). Howe er' through the 3ourtMs decision in the case of Agan . !IAT3/' the contract between the Do ernment and !IAT3/ was nullified despite the completion of the construction. Therefore' NAIA = remained owned and possessed by !IAT3/. The Do ernment filed a complaint for expropriation which was presided by Hon. Henric$ ?. Dingoyon (petitioner) and resulted to the following orders2 In accordance to @A &(1.' the Do ernment was re#uired to pay !IAT3/ SA-.=7 in order to entitled to the writ of possession. It was stated that the Do ernment e en if granted The Do ernment #uestions the alidity of the decision claiming2 That @ule A1 of 1((1 @ules of 3i il !rocedure' should go ern the exercise of the power of eminent domain' not @A &(1.. @ule A1 pro ides that the Do ernment is only re#uired to ma$e an initial deposit with an authori6ed depositary would entitled the it to the writ of possession. That the assessed alue of property should only be !=). That the appointment of commissioners was erroneous. Issue2 Chether @A &(1. should go ern the expropriation of NAIA =. @uling :es. ;ince NAIA = is considered a national pro+ect' @A &(1.' which is entitled' IAn Act to ?acilitate the Ac#uisition of @ight of Cay' ;ite or <ocation for National Do ernment Infrastructure !ro+ects and for /ther !urposes' should go ern its expropriation' and the Do ernment is re#uired to first pay +ust compensation before it is entitled to possession of NAIA = but the amount to be paid is sub+ect to modification. @A &(1. contemplates within its co erage such real property constituting land' buildings' roads and constructions of all $inds adhered to the soil and NAIA = facilities are considered real properties. Therefore' since only the land on which NAIA = was constructed by the Do ernment' NAIA = as real property may also be the sub+ect of expropriation and !IAT3/ as its owner is entitled to +ust compensation. )efore the Do ernment to be entitled to possession of NAIA = howe er' +ust compensation must first be paid to

!IAT3/ as pro ided in ;ec. . of @A &(1... @epublic . <im2 Title to the property expropriated shall pass from the owner to the expropriator only upon full payment of the +ust compensation. 7unicipality of )inan . Darcia2 - ;tages in expropriation2 1) ,etermination of the authority of the plaintiff to exercise the power of eminent domain and the propriety of its exercise in the context of the facts in ol ed in the suit -) ,etermination by the court of +ust compensation for property sought to be ta$en. Lnder @A &(1.' the Do ernment is re#uired to immediately pay the owner of the property the amount e#ui alent to the sum of2 1) 1""O of the alue of the property based on the current rele ant 6onal aluation of the )I@> and -) Halue of the impro ements and8 or structure as determined in ;ec. 1. In this case' only the alue of the impro ements and structure will be considered in determining +ust compensation as the 6onal aluations are not applicable considering that the Do ernment already owns the land on which NAIA = was constructed. Although there is no way' at the present to immediately ascertain the alue of the impro ements and the structure' @A &(1. allows that only the Iproffered alueJ be paid to the owner. In this case' the Do ernment' in filing the . complaint for expropriation' alleged to ha e deposited the amount of !=)' representing the assessed alue of the property K it is that =) which is recogni6ed as the proffered alue but such proffered alue may be sub+ect +udicial re iew. The SA-.=7' which the court ordered to be paid is modified' as that amount included the 6onal aluations which was already mentioned to be inapplicable in this case. ?inally' the appointment of the commissioners was not erroneous. The re#uirement of appointment of commissioners to assist in the determination of +ust compensation pro ided in @ule A1 is applicable since it is not inconsistent with @A &(1.. In contrast to the claim of the Do ernment howe er' there is no re#uirement to consult with the parties on who should be appointed as commissioner. .4. REPF/<IC OF T?E P?I<IPPINES, e . 'l. v). GINGONON, e . 'l., G.R. No. 1664.:. The Do ernment filed different motions for reconsideration. 1.) /n the newly raised arguments' there are considerable factual elements brought up by the Do ernment. In the main' the Do ernment de otes significant effort in diminishing !IAT3/Es right to +ust compensation as builder

Course Outline Constitutional Law II or owner of the NAIA =. !articularly brought to fore are the claims relating to two entities' Ta$ena$a 3orporation (Ta$ena$a) and Asahi$osan (Asahi$osan) 3orporation' who allegedly claim *significant liens* on the terminal' arising from their alleged unpaid bills by irtue of an 4ngineering' !rocurement and 3onstruction 3ontract they had with !IAT3/. /n account of these ad erse claims' the Do ernment now claims as contro ertible the #uestion of who is the builder of the NAIA =. 2.) The Do ernment argues that the -"". +esolution in Agan did not strictly re#uire the payment of +ust compensation before the Do ernment can ta$e o er the airport facilities. @eliance is placed on the use by the 3ourt of the word *for*' instead of *before.* :et the clear intent of that ruling is to mandate payment of +ust compensation as a condition precedent before the Do ernment could ac#uire physical possession o er the airport facilities. The #ualification was made out of due consideration of the fact that !IAT3/ had already constructed the facilities at its own expense when its contracts with the Do ernment were nullified. 3.) The Do ernment also exhausti ely cites the ,issenting /pinion in arguing that the application of @ule A1 would iolate the -"". @esolution of the 3ourt in Agan. It claims that it is not possible to determine with reasonable certainty the proper amount of +ust compensation to be paid unless it first ac#uires possession of the NAIA =. :et what the ,ecision mandated to be paid to !IAT3/ before the writ of possession could issue is merely the pro isionally determined amount of +ust compensation which' under the auspices of @ep. Act No. &(1.' constitutes the proffered alue as submitted by the Do ernment itself. There is thus no need for the determination with reasonable certainty of the final amount of +ust compensation before the writ of possession may be issued. ;pecifically in this case' only the payment or release by the Do ernment of the proffered alue need be made to trigger the operability of the writ of possession. Issue2 C/N the motions for reconsideration filed by the @epublic is meritorious. @uling2 1.) The 3ourt is not wont to re erse its pre ious rulings based on factual premises that are not yet conclusi e or +udicially established. 3ertainly' whate er claims or purported liens Ta$ena$a and Asahi$osan against !IAT3/ or o er the NAIA = ha e not been +udicially established. Neither Ta$ena$a nor Asahi$osan are parties to the present action' and thus ha e not presented any claim which could be acted upon by this 3ourt. The earlier ad+udications in Agan v. P,A-!. made no mention of either Ta$ena$a or Asahi$osan' and certainly made no declaration as to their rights to any form of compensation. If there is indeed any right to remuneration due to these two entities arising from NAIA =' they ha e not yet been established by the courts of the land.

2.) 4 en assuming that *for* may be construed as not necessarily meaning *prior to*' it cannot be denied that @ep. Act No. &(1. does re#uire prior payment to the owner before the Do ernment may ac#uire possession o er the property to be expropriated. 4 en @ule A1 re#uires the disbursement of money by way of deposit as a condition precedent prior to entitlement to a writ of possession. As the instant case is one for expropriation' our pronouncement is worthily consistent with the principles and laws that go ern expropriation cases. 3.) Admittedly' the -"". @esolution in Agan could be construed as mandating the full payment of the final amount of +ust compensation before the Do ernment may be permitted to ta$e o er the NAIA =. Howe er' the ,ecision ultimately re+ected such a construction' ac$nowledging the public good that would result from the immediate operation of the NAIA =. Instead' the ,ecision adopted an interpretation which is in consonance with @ep. Act No. &(1. and with e#uitable standards as well' that allowed the Do ernment to ta$e possession of the NAIA = after payment of the proffered alue of the facilities to !IAT3/. ;uch a reading is substantially compliant with the pronouncement in the -"". Agan @esolution' and is in accord with law and e#uity. In contrast' the Do ernmentEs position' hewing to the strict application of @ule A1' would permit the Do ernment to ac#uire possession o er the NAIA = and implement its operation without ha ing to pay !IAT3/ a single centa o' a situation that is ob iously unfair. Chate er animosity the Do ernment may ha e towards !IAT3/ does not ac#uit it from settling its obligations to the latter' particularly those which had already been pre iously affirmed by this 3ourt CH4@4?/@4' the 7otion for !artial @econsideration of the petitioners is ,4NI4, CITH ?INA<IT:. The motions respecti ely filed by Ta$ena$a 3orporation' Asahi$osan 3orporation and @epresentati e ;alacnib )aterina are ,4NI4,. ;/ /@,4@4,. .2. 1ESFS IS <ORD C?RISTIAN SC?OO< FOFNDATION, INC., v). MFNICIPA<ITN @no6 CITNJ OF PASIG, G.R. No. 15..93. .:. CIR v. CENTRA< <FMON DRFG CORPORATION, 3entral <u6on ,rug 3orp. (I3entralJ) is a domestic corporation primarily engaged in retailing of medicines and other pharmaceutical products. ?rom 0anuary to ,ecember 1((A' respondent granted -" per cent sales discount to #ualified senior citi6ens on their purchases of medicines pursuant to @A 1.=- and its Implementing @ules and @egulations. ?or the said period' the amount allegedly representing the -" per cent sales discount granted by respondent to #ualified senior citi6ens totaled !(".'1A(."". /n 0anuary 1A' 1((&' respondent filed with petitioner a claim for tax refund8credit in the amount of !(".'1A(."" allegedly arising from the

Course Outline Constitutional Law II -" per cent sales discount granted by respondent to #ualified senior citi6ens in compliance with @A 1.=-. Lnable to obtain affirmati e response from petitioner' respondent ele ated its claim to the 3ourt of Tax Appeals ia a !etition for @e iew. The Tax 3ourt dismissed respondentEs !etition for lac$ of merit. Howe er' upon the motion for reconsideration lodged by the respondent to the 3TA' the latter issued a Tax 3redit 3ertificate in fa or of the former. The 3A affirmed in toto the @esolution of the 3TA. It reasoned that @A 1.=- re#uired neither a tax liability nor a payment of taxes by pri ate establishments prior to the a ailment of a tax credit. 7oreo er' such credit is not tantamount to an unintended benefit from the law' but rather a +ust compensation for the ta$ing of pri ate property for public use. Hence' this petition. I;;L42 Chether the respondent' despite incurring a net loss' may still claim the -" percent sales discount as a tax credit. H4<,2 The petition is ,4NI4,. The decision and resolution of 3A are A??I@74,. ;ection .(a) of @A 1.=- grants to senior citi6ens the pri ilege of obtaining a -" percent discount on their purchase of medicine from any pri ate establishment in the country. The latter may then claim the cost of the discount as a tax credit e en though an establishment operates at a loss. ;ections -.i and . of @@ -F(. deny the exercise by the ;tate of its power of eminent domain. )e it stressed that the pri ilege en+oyed by senior citi6ens does not come directly from the ;tate' but rather from the pri ate establishments concerned. Accordingly' the tax credit benefit granted to these establishments can be deemed as their +ust compensation for pri ate property ta$en by the ;tate for public use. 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 con enience. The discount pri ilege to which our senior citi6ens are entitled is actually a benefit en+oyed by the general public to which these citi6ens belong. The discounts gi en would ha e entered the coffers and formed part of the gross sales of the pri ate establishments concerned' were it not for @A 1.=-. The permanent reduction in their total re enues is a forced subsidy corresponding to the ta$ing of pri ate property for public use or benefit. As a result of the -" percent discount imposed by @A 1.=-' the respondent becomes entitled to a +ust compensation. This term refers not only to the issuance of a tax credit certificate indicating the correct amount of the discounts gi en' but also to the promptness in its release. 4#ui alent to the payment of property ta$en by the ;tate' such issuance FF when not done within a reasonable time from the grant of the discounts FF cannot be considered as +ust compensation. The effect' respondent is made to suffer the conse#uences of being immediately depri ed of its re enues while awaiting actual receipt' through the certificate' of the e#ui alent amount it needs to cope with the reduction in its re enues. 93. MFNICIPA<ITN OF MENCAFANAN, /F<ACAN, e . 'l. v). IAC, the 7unicipal 3ouncil of 7eycauayan' headed by then 7ayor 3elso @. <egaspi' passed @esolution No. -%&' ;eries of 1(1%' manifesting

the intention to expropriate the respondentMs parcel of land. Trial court issued a writ of possession in fa or of petitioner The respondent went to the Intermediate Appellate 3ourt on petition for re iew. The appellate court held that there is no genuine necessity to expropriate the land for use as a public road as there were se eral other roads for the same purpose and another more appropriate lot for the proposed public road. The court' ta$ing into consideration the location and si6e of the land' also opined that the land is more Ideal for use as storage area for respondentMs hea y e#uipment and finished products 3ommittee obser ation2 ;ince there is another lot ready for sale and lying Idle' ad+acent and on the western side of the strip of land' and extending also from 7alhacan @oad to )ulac @oad and most Ideal for a public road because it is ery much wider than the lot sought to be expropriated' it seems that it is more +ust' fair' and reasonable if this lot is the one to be expropriated C8N there was genuine necessity in expropriating respondentEs lot9 No This 3ourt re iews and rectifies the findings of fact of the 3ourt of Appeals only under certain established exceptions such as2 (1) when the conclusion is a finding grounded entirely on speculations' surmises and con+ectures> (-) when the inference made is manifestly mista$en' absurd and impossible> (=) when there is gra e abuse of discretion> (.) when the +udgment is based on a misapprehension of facts> and (%) when the court' in ma$ing its finding' went beyond the issues of the case and the same is contrary to the admissions of both the appellant and the appellee (7oran' 0r. . 3ourt of Appeals' 1== ;3@A &&). this 3ourt held that the foundation of the right to exercise the power of eminent domain is genuine necessity and that necessity must be of a public character. 3ondemnation of pri ate property is +ustified only if it is for the public good and there is a genuine necessity of a public character. 3onse#uently' the courts ha e the power to in#uire into the legality of the exercise of the right of eminent domain and to determine whether there is a genuine necessity therefore. The go ernment may not capriciously choose what pri ate property should be ta$en Cith due recognition then of the power of 3ongress to designate the particular property to be ta$en and how much thereof may be condemned in the exercise of the power of expropriation' it is still a +udicial #uestion whether in the exercise of such competence' the party ad ersely affected is the ictim of partiality and pre+udice. That the e#ual protection clause will not allow There is absolutely no showing in the petition why the more appropriate lot for the proposed road which was offered for sale has not been the sub+ect of the petitionerMs attempt to expropriate 91. <AGCAO, e . 'l. v. 1FDGE <A/RA, G.R. No. 155446. O$ o5er 19, .334 F'$ )>

Course Outline Constitutional Law II 1. In 1(A. !ro ince of 3ebu donated -1" lots to 3ity of 3ebu' it includes </T 1"-( which was e entually purchased by the !etitioners from 3ity of 3ebu on installment basis. Howe er' in 1(A% the -1" lots including lot 1"-( re erted to the !ro ince of 3ebu hence prompted them to annul the sale of <ot 1"-( to the petitioners. -. !etitioner sued the pro ince were the 3ourt granted infa or of the petitioners and ordered the !ro ince to execute deed of sale hence the transfer of the lot was issued under the name of !etitioners =. Howe er' when the petitioner tried to ta$e possession of the lot they disco ered that it was occupied by the s#uatters hence' urged them to instituted e+ectment proceedings against s#uatters.7T3 rendered decision and issued a writ of execution and order of demolition .. Chen the demolition order was about to be implemented the 3ebu 3ity re#uested for defernment since they are still loo$ing for a relocation site.Howe er during the suspension period instead of loo$ing for a relocation site' ;angguniang !anglungsod passed /rdinance No. 1&.= IAn /rdinance Authori6ing the 3ity 7ayor of 3ebu 3ity to institute expropriation proceedings against 7rs. 3rispina Hda. ,e <agcao owner of the lot 1"-( located at Dreen Halley' 3apitol ;ite 3ebu 3ity to ac#uire the same for public use or purposeJ which Is acted pursuant to ;ec 1( @A 11A" (<DLEs power of eminent domain) %. Hence' petitioners upholds its alidity on the grounds that it is unconstitutional for being contrary to the concept of Ipublic useJ since it will only benefit the s#uatters. I))ue> WGN Or+#n'n$e No. 1249 #) un$on) # u #on'lH Rul#ng> :es' ;3 recogni6e that housing is one of the most serious problems of the country but <DL do not possess the authority to exercise power of eminent domain to see$ for the solution of this problem. <DLEs exercise of power of eminent domain is not absolute there are - limitation pro ided> 1. No person shall be depri ed by life' property and liberty w8o due process -. !ri ate property shall not be ta$en w8o +ust compensation. Hence' the ordinance is iolati e of the petitioners right to due process. It failed to comply with the re#uirements below> ?or an ordinance to be alid it should 1. Not contra ene the constitution (repugnant with @A 1-1( and @A 11A") -. 7ust not be unfair and oppressi e (oppressi e to the landowner) =. 7ust not be partial or discrimatory (it singled out landowners property out of the -1" lots)

.. 7ust not prohibit but regulate trade (no reasonable rel. b8w sub+ectFpro ide housing and meansFfell short) %. 7ust be consistent with public policy A. 7ust not be unreasonable. 9.. DE <A PAM MASIBIP v. CITN OF PASIG ?acts2 - <ourdes ,ela !a6 7asi$ip (7asi$ip2 petitioner) is the owner of a parcel of land in )arangay 3aniogan' !asig 3ity. - The 3ity of !asig notified 7asi$ip of its intention to expropriate her property for the purpose of pro iding sports and recreational facilities to its poor residents. o The 3ity of !asig filed a complaint for expropriation and was granted by the court. - 7asi$ip #uestions the decision of the court' claiming that expropriation of her property was an in alid exercise of eminent domain as there is not genuine necessity for the ta$ing of her property. Issue2 Chether there is a genuine necessity for the ta$ing of 7asi$ipEs property for the establishment of a sports and recreational facility. @uling2 No. Necessity has not been shown' considering that there exists an alternati e facility for sports de elopment and community recreation only a short distance away. !ower of 4minent ,omain K right of the go ernment to ta$e and appropriate pri ate property to public use' whene er the public exigency re#uires it' which can be done only on condition of pro iding reasonable compensation. o It is the power of the ;tate or its instrumentalities to ta$e pri ate property for the public use and is inseparable from so ereignty and inherent in go ernment. The power of eminent domain was delegated to local go ernment units (<DLEs) by ;ec. 1( of the <ocal Do ernment 3ode of 1((1. 0udicial @e iew of the exercise of eminent2 o Ade#uacy of the compensation> o Necessity of the ta$ing> and o !ublic use character of the purpose of the ta$ing. The ery foundation of the right to the exercise of eminent domain is a genuine necessity and the necessity must be of a public character. o 3ity of 7anila . Arellano <aw 3ollege2 necessity within the rule that the particular property to be expropriated must be necessary' does not mean and absolute but only a reasonable and practical necessity' such as would combine the greatest benefit to the public with the leas incon enience and expense to the condemning party and the property owner consistent with such benefit. In the case' the 3ity of !asig failed to establish that there was a genuine necessity to expropriate petitionerEs property as not only was there already an alternati e facility a short distance away but the certification issued by the )arangay 3ouncil' which was the basis of the expropriation' indicates that the intended beneficiary is the

Course Outline Constitutional Law II 7elendres 3ompound Homeowners Association' a pri ate nonFprofit organi6ation' not the residents of )arangay 3aniogan. POWER OF TAOATION 1. P')$u'l v. Se$re 'r% o( Pu5l#$ Wor7), 113 P?I<. 991 FACTS> !ascual' in his official capacity as the !ro incial Do ernor of @i6al' petitioned for a writ of certiorari against the dismissal of the case and dissol ing of the preliminary in+unction held by the 3ourt of the ?irst Instance. !etitioner prayed for that @A T(-" be declared null and oid' that the alleged ,eed of ,onation made by Nulueta be declared unconstitutional. !etitioner also prayed for an in+unction en+oining ;ecretary of !ublic Cor$s and 3ommunications' ,irector of !ublic Cor$s and Highways and the disbursing officers of the latter department from ma$ing and securing any further release of funds for the said road pro+ect. @AT (-" contained an item appropriating !&%'"""."" which the petitioner alleged that it was for the construction of roads impro ing the pri ate property of 0ose Nuleta' a member of the ;enate. ISSFES> 1. Chether or not @A T (-" is unconstitutional. -. Chether or not !ascual has the legal capacity or to sue. ?E<D> 1. @A T(-" is unconstitutional because the 3ongress is without power to appropriate public re enue for anything but public purpose. -. !ascual has the personality to sue as a taxpayer recogni6ing the right of the taxpayer to assail the constitutionality of a legislation appropriating public funds. .. Pun*'l'n v. Mun#$#"'l /o'r+ o( M'n#l', :5 P?I<. 46 Km, ?A3T;2 7unicipal )oard of 7anila enacted /rdinance ==(&' which le ies an occupation tax to professionals. !etitioners argue that they are being double taxed as they ha e already paid occupation tax through ;ection -"1 of the National Internal @e enue 3ode. I;;L42 C/N there is double taxation. H4<,2 No' ;3 stated that the argument against double taxation may not be in o$ed where one tax is imposed by the state and the other is imposed by the city. 9. <l'+o$ v. Comm#))#oner o( In ern'l Revenue, 14 SCRA .:. ?acts2 ;ometime in 1(%1' 7.). 4state Inc.' of )acolod 3ity' donated 1"'"""."" pesos in cash to ?r. 3rispin @ui6' the parish priest ofHictorias' Negros /ccidental' and predecessor of ?r. <ladoc' for theconstruction of a new 3atholic church in the locality. The donated amount was spent for such purpose. /n 7arch =' 1(%&' the donor 7.). 4state filed the donorMs gift tax return. Lnder date of April -(' 1(A". 3ommissioner of Internal @e enue issued an assessment for the doneeMs gift tax against the 3atholic !arish of Hictorias of which petitioner was the parish priest. Issue2 Chether or not the imposition of gift tax despite the fact the ?r. <ladoc was not the !arish priest at the time of donation' 3atholic !arish priest of Hictorias did not ha e +uridical personality as the constitutional exemption for religious purpose is alid.

Held2 :es' imposition of the gift tax was alid' under ;ection --(=) Article HI of the 3onstitution contemplates exemption only from payment of taxes assessed on such properties as !roperty taxes contra distinguished from 4xcise taxes The imposition of the gift tax on the property used for religious purpose is not a iolation of the 3onstitution. A gift tax is not a property by way of gift inter i os. The head of the ,iocese and not the parish priest is the real party in interest in the imposition of the doneeMs tax on the property donated to the church for religious purpose. 4. A5r' A'lle% College v. A8u#no, 16. SCRA 136 !etitioner' an educational corporation and institution of higher learning duly incorporated with the ;ecurities and 4xchange 3ommission in 1(.&' filed a complaint on 0uly 1"' 1(1- in the court a quo to annul and declare oid the *Notice of ;ei6ureM and the *Notice of ;ale* of its lot and building located at )angued' Abra' for nonF payment of real estate taxes and penalties amounting to !%'1.".=1. the trial court among others' found the following2 (c) that the elementary pupils are housed in a twoFstorey building across the street> (d) that the high school and college students are housed in the main building> (e) that the ,irector with his family is in the second floor of the main building> and (f) that the annual gross income of the school reaches more than one hundred thousand pesos whether or not the lot and building in #uestion are used exclusively for educational purposes9 the exemption in fa or of property used exclusi ely for charitable or educational purposes is Mnot limited to property actually indispensableM but extends to facilities which are incidental to and reasonably necessary for the accomplishment of said purposes' such as in the case of hospitals' *a school for training nurses' a nursesM home' property use to pro ide housing facilities for interns' resident doctors' superintendents' and other members of the hospital staff' and recreational facilities for student nurses' interns' and residentsM' such as *Athletic fields* including *a firm used for the inmates of the institution. The test of exemption from taxation is the use of the property for purposes mentioned in the 3onstitution It must be stressed howe er' that while this 3ourt allows a more liberal and nonFrestricti e interpretation of the phrase *exclusi ely used for educational purposes* as pro ided for in Article HI' ;ection --' paragraph = of the 1(=% !hilippine 3onstitution' reasonable emphasis has always been made that exemption extends to facilities which are incidental to and reasonably necessary for the accomplishment of the main purposes. /therwise stated' the use of the school building or lot for commercial purposes is neither contemplated by law' nor by +urisprudence. Thus' while the use of the second floor of the main building in the case at bar for residential purposes of the ,irector and his family' may find +ustification under the concept of incidental use' which is complimentary to the main or

Course Outline Constitutional Law II primary purposeUeducational' the lease of the first floor thereof to the Northern 7ar$eting 3orporation cannot by any stretch of the imagination be considered incidental to the purpose of education. Lnder the 1(=% 3onstitution' the trial court correctly arri ed at the conclusion that the school building as well as the lot where it is built' should be taxed' not because the second floor of the same is being used by the ,irector and his family for residential purposes' but because the first floor thereof is being used for commercial purposes. Howe er' since only a portion is used for purposes of commerce' it is only fair that half of the assessed tax be returned to the school in ol ed. 5. T'n v. +el Ro)'r#o, .94 SCRA 9.4; F'$ )> 1. There are - consolidated ci il action for prohibition on this case. a. The 3onstitutionality of @A 1.(A $nown as the ;implified Net Income Taxation ;cheme where the tax imosed on the taxable net in accordance to the schedule scheme > Not o er !1"' """" =O / er !1"'""" but not o er ! ="' """ !="" V(O of excess of !1"'""" / er ="'""" but not o er !1-"'""" !-'1"" V1%O of excess o er !="'""" / er !1-"'""" but not o er !=%"'""" !1%'A"" V-"O of excess o er p1-"'""" / er !=%"'""" !A1'A" V="O of excess o er !=%"'""" b. The alidity of ;ectionA @e enue regulation promulgated by respondent applying ;NIT to general professional partnership. -. !etitioner contends that @A 1.(A iolates the rule of taxation on uniformity and e#uitability and that no person shall be depri ed of xxxx without due process and e#ual protection of laws. I))ue> WGN RA 44:6 #) un$on) # u #on'lH Rul#ng>No, 1. Lniformity of taxation re#uires that all sub+ects or ob+ects of taxation' similarly situated are to be treated ali$e both in pri ileges and liabilities. Lniformity does not forfend classification as long as> a. the standards that are usd are substantial and not arbitrary b. the categori6ation is germane to achie e legislati e purpose c. the law applies' all things being e#ual' to both present and future conditions d. and the classification applies e#ually well to those belonging to the same class. Hence' the classification pro ided in ;NIT is not arbitrary and inappropriate. B @A 1.(A is constitutional it is not iolati e of due process. ,ue process may be correctly be in o$ed only when there is a clear contra ention of inherent or constitutional limitations in the exercise of tax power.

Deneral !rofessional !artnership unli$e ordinary business partnership is not itself an income taxpayer. The income tax is imposed not on the professional partnership which is tax exempt but on the !A@TN4@; themsel es which is liable in their indi idual capacity computed on their distributi e shares. BHence' all indi iduals deri ing income from any source are treated in almost in ariably the same manner and under the common set of rules. ;ec A of I@@ did not alter but merely confirmed @A 1.(A on the extent of allowable deduction applicable to A<< indi idual income taxpayer on their nonFcompensation income. A. T#o v. AR/, 151 SCRA .32 ?acts2 - !etitioners filed the petition on behalf of other ideogram operators ad ersely affected' #uestioning the constitutionality of !, 1(&1' created the Hideogram @egulatory )oard and which resulted to the imposition of a ="O tax sale and rent of ideotapes and other ideogram. o !etitioners content that the ="O tax imposed is harsh' confiscatory' and oppressi e. Issue2 Chether the ="O imposed on the sale' lease and disposition of ideograms is harsh' confiscatory' and oppressi e. @uling2 No. the tax imposed by !, 1(&1 is not harsh' confiscatory and oppressi e. - The tax imposed by !, 1(&1 is not only a regulatory but also a re enue measure prompted by the reali6ation that the earnings of ideogram establishments of around !A"" million per annum ha e not been sub+ected to tax' thereby depri ing the Do ernment of an additional source of re enue. - The ="O tax is for a public purpose K an answer to the need for regulating the ideo industry particularly because of the rampant' film piracy' the flagrant iolation of intellectual property rights' and proliferation of pornographic ideotapes' as well as to protect the mo ie industry. - Taxation has been the implement of the stateEs police power. - ?inally' a tax does not cease to be alid merely because it regulates' discourages or e en definitely deters the acti ities taxed. 4. O5#llo) v. CIR, 19: SCRA 496; ?A3T;2 This case is about the income tax liability of four brothers and sisters who sold two parcels of land which they had ac#uired from their father. In 1(1.' the petitioners sold two lots gi en to them by their father' 0ose /billos' ;r for the total sum of !=1='"%". They deri ed from the sale a total profit of !1=.'=.1.&& or !=='%&. for each of them. They treated the profit as a capital gain and paid an income tax on oneFhalf thereof or of !1A'1(-.

-.

Course Outline Constitutional Law II In April' 1(&"' or one day before the expiration of the fi eFyear prescripti e period' the 3ommissioner of Internal @e enue re#uired the four petitioners to pay corporate income tax on the total profit of !1=.'==A in addition to indi idual income tax on their shares thereof He assessed !=1'"1& as corporate income tax' !1&'%"( as %"O fraud surcharge and !1%'%.1.%A as .-O accumulated interest' or a total of P/0"1/2.34. Not only that. He considered the share of the profits of each petitioner in the sum of !=='%&. as a * taxable in full (not a mere capital gain of which W is taxable) and re#uired them to pay deficiency income taxes aggregating !%A'1"1.-" including the %"O fraud surcharge and the accumulated interest. Thus' the petitioners are being held liable for deficiency income taxes and penalties totalling !1-1'1&1.1A on their profit of !1=.'==A' in addition to the tax on capital gains already paid by them. The 3ommissioner acted on the theory that the four petitioners had formed an unregistered partnership or +oint enture within the meaning of sections -.(a) and &.(b) of the Tax 3ode (3ollector of Internal @e enue s. )atangas Trans. 3o.' 1"- !hil. &--). The petitioners contested the assessments. Two 0udges of the Tax 3ourt sustained the same. 0udge @oa#uin dissented. Hence' the instant appeal. I;;L42 Chether or not the petitioner had formed an unregistered partnership or +oint enture. H4<,2 The 3ourt held that it is error to consider the petitioners as ha ing formed a partnership under article 11A1 of the 3i il 3ode simply because they allegedly contributed !11&'1"&.1- to buy the two lots' resold the same and di ided the profit among themsel es. ITo regard the petitioners as ha ing formed a taxable unregistered partnership would result in oppressi e taxation and confirm the dictum that the power to tax in ol es the power to destroy. That e entuality should be ob iated. As testified by 0ose /billos' 0r.' they had no such intention. They were coFowners pure and simple. To consider them as partners would obliterate the distinction between a coFownership and a partnership. The petitioners were not engaged in any +oint enture by reason of that isolated transaction. Their original purpose was to di ide the lots for residential purposes. If later on they found it not feasible to build their residences on the lots because of the high cost of construction' then they had no choice but to resell the same to dissol e the coFownership. The di ision of the profit was merely incidental to the dissolution of the coFownership which was in the nature of things a temporary state. It had to be terminated sooner or later. Article 11A((=) of the 3i il 3ode pro ides that *the sharing of gross returns does not of itself establish a partnership' whether or not the persons sharing them ha e a +oint or common right or interest in any property from which the returns are deri ed*. There must be an unmista$able intention to form a partnership or +oint enture. P

All co5o&nerships are not deemed unregistered pratnership.)3oF /wnership who own properties which produce income should not automatically be considered partners of an unregistered partnership' or a corporation' within the pur iew of the income tax law. To hold otherwise' would be to sub+ect the income of all co5o&nerships of inherited properties to the tax on corporations' inasmuch as if a property does not produce an income at all' it is not sub+ect to any $ind of income tax' whether the income tax on indi iduals or the income tax on corporation. (,e <eon s. 3I @' 3TA 3ase No. 1=&' ;eptember 11' 1(A1' cited in AraXas' 1(11 Tax 3ode Annotated' Hol. 1' 1(1( 4d.' pp. 11F1&). In the instant case' what the 3ommissioner should ha e in estigated was whether the father donated the two lots to the petitioners and whether he paid the donorMs tax (;ee Art. 1..&' 3i il 3ode). Ce are not pre+udging this matter. It might ha e already prescribed. I The +udgment of the Tax 3ourt was re ersed and set aside and the assessments were cancelled.

2. CIR v. CA, G.R. No. 1.4349, O$ o5er 14, 1::2 ?A3T;2 3I@ is compelling :73A to pay income tax because of its rental income' :73A argues that it is exempted from paying such tax as it is considered as an educational institution. I;;L42 C/N :73A is exempted in paying income tax. H4<,2 No' Tax exemption laws shall be construed strictly. )ecause taxes are the lifeblood of the nation. :73A is not con to be considered an educational institution. Also' educational institutions are exempted to pay real property tax and not income tax. :. S#)on v.An$!e ', e . 'l., G.R. No. <;5:491. 1ul% .5, 1:24 F'$ )> ;ection 1 of )! )lg 1=% amended the Tax 3ode and petitioner Antero 7. ;ison' as taxpayer' alleges that *he would be unduly discriminated against by the imposition of higher rates of tax upon his income arising from the exercise of his profession isFaF is those which are imposed upon fixed income or salaried indi idual taxpayers. He characteri6es said pro ision as arbitrary amounting to class legislation' oppressi e and capricious in character. It therefore iolates both the e#ual protection and due process clauses of the 3onstitution as well as of the rule re#uiring uniformity in taxation. I))ue> Chether or not the assailed pro ision iolates the e#ual protection and due process clauses of the 3onstitution while also iolating the rule that taxes must be uniform and e#uitable. ?el+> The petition is without merit. /n due process F it is undoubted that it may be in o$ed where a taxing statute is so arbitrary that it finds no support in the 3onstitution. An ob ious example is where it can be shown to amount to the confiscation of property from abuse of power. !etitioner alleges arbitrariness but his mere

Course Outline Constitutional Law II allegation does not suffice and there must be a factual foundation of such unconsitutional taint. /n e#ual protection F it suffices that the laws operate e#ually and uniformly on all persons under similar circumstances' both in the pri ileges conferred and the liabilities imposed. /n the matter that the rule of taxation shall be uniform and e#uitable F this re#uirement is met when the tax operates with the same force and effect in e ery place where the sub+ect may be found.* Also' 2the rule of uniformity does not call for perfect uniformity or perfect e#uality' because this is hardly unattainable.* Chen the problem of classification became of issue' the 3ourt said2 *4#uality and uniformity in taxation means that all taxable articles or $inds of property of the same class shall be taxed the same rate. The taxing power has the authority to ma$e reasonable and natural classifications for purposes of taxation...* As pro ided by this 3ourt' where *the differentation* complained of *conforms to the practical dictates of +ustice and e#uity* it *is not discriminatory within the meaning of this clause and is therefore uniform.* 13. CITN GOAERNMENT OF QFEMON CITN, e . 'l. v). /ANAN TE<ECOMMFNICATIONS ()ayantel) is a legislati e franchise holder to establish and operate radio stations for domestic telecommunications' radiophone' broadcasting and telecasting. /n 0anuary 1' 1((-' @ep. Act No. 11A"' otherwise $nown as the *<ocal Do ernment 3ode of 1((1* (<D3)' too$ effect. ;ection -=- of the 3ode grants local go ernment units within the 7etro 7anila Area the power to le y tax on real properties' thus2 ;43. -=-. K !ower to <e y @eal !roperty Tax. K A pro ince or city or a municipality within the 7etropolitan 7anila Area may le y an annual ad alorem tax on real property such as land' building' machinery and other impro ements not hereinafter specifically exempted. /n 0uly -"' 1((-' barely few months after the <D3 too$ effect' 3ongress enacted @ep. Act No. 1A==' amending )ayantelEs original franchise. The amendatory law (@ep. Act No. 1A==) contained the following tax pro ision2 ;43. 11. The grantee' its successors or assigns shall be liable to pay the same taxes on their real estate' buildings and personal property' exclusi e of this franchise' as other persons or corporations are now or hereafter may be re#uired by law to pay. In addition thereto' the grantee' its successors or assigns shall pay a franchise tax e#ui alent to three percent (=O) of all gross receipts of the telephone or other telecommunications businesses transacted under this franchise by the grantee' its successors or assigns and the said percentage shall be in lieu of all taxes on this franchise or earnings thereof. !ro ided' That the grantee' its successors or assigns shall continue to be liable for income taxes payable under Title II of the National Internal @e enue 3ode Y. xxx. P4mphasis suppliedQ whether or not )ayantelEs real properties in 5ue6on 3ity are' under its franchise' exempt from real property tax.

4xempt )ayantelEs posture is wellFta$en. Chile the system of local go ernment taxation has changed with the onset of the 1(&1 3onstitution' the power of local go ernment units to tax is still limited. As we explained in 7actan 3ebu International Airport Authority2 1" The power to tax is primarily ested in the 3ongress> howe er' in our +urisdiction' it may be exercised by local legislati e bodies' no longer merely be irtue of a alid delegation as before' but pursuant to direct authority conferred by ;ection %' Article R of the 3onstitution. Lnder the latter' the exercise of the power may be sub+ect to such guidelines and limitations as the 3ongress may pro ide which' howe er' must be consistent with the basic policy of local autonomy. the 3ourt stressed in 7actan' *the power to tax is PstillQ primarily ested in the 3ongress.* whether natural or +uridical Y.'*1- there can really be no dispute that the power of the 5ue6on 3ity Do ernment to tax is limited by ;ection -=- of the <D3.Lnder this law' the <egislature highlighted its power to thereafter exempt certain realties from the taxing power of local go ernment units. An interpretation denying 3ongress such power to exempt would reduce the phrase *not hereinafter specifically exempted* as a pure +argon' without meaning whatsoe er. Needless to state' such absurd situation is unacceptable. Admittedly' @ep. Act No. 1A== was enacted subse#uent to the <D3. !erfectly aware that the <D3 has already withdrawn )ayantelEs former exemption from realty taxes' 3ongress opted to pass @ep. Act No. 1A== using' under ;ection 11 thereof' exactly the same defining phrase *exclusi e of this franchise* which was the basis for )ayantelEs exemption from realty taxes prior to the <D3. 11. TO<ENTINO v. SECRETARN OF FINANCE, ?acts2 1. Tolentino et al is #uestioning the constitutionality of @A 111A otherwise $nown as the 4HAT <aw. Tolentino claims that this re enue bill did not exclusi ely originate from the Ho@ as re#uired by ;ec -.' Art A of the 3/N;T because it is in fact the result of the consolidation of - distinct bills' H. No. 111(1 and ;. No. 1A=". -. The alueFadded tax (HAT) is le ied on the sale' barter or exchange of goods and properties as well as on the sale or exchange of ser ices. @A 111A see$s to widen the tax base of the existing HAT system and enhance its administration by amending the National Internal @e enue 3ode. I))ue> W!e !er or no RA 4416 v#ol' e) Ar . AI, Se$). .4 o( !e Con) # u #on Rul#ng> 6ection 72. All appropriation" revenue or tariff %ills" %ills authori$ing increase of the pu%lic de%t" %ills of local application" and private

Course Outline Constitutional Law II %ills" shall originate exclusively in the 8ouse of +epresentatives" %ut the 6enate may propose or concur &ith amendments. ;c Held that the argument that @A 111A did not originate exclusi ely in the House of @epresentati es as re#uired by Art. HI' ;ec. -. of the 3onstitution will not bear analysis. It is not the law but the re enue bill which is re#uired by the 3onstitution to originate exclusi ely in the House of @epresentati es. To insist that a re enue statute and not only the bill which initiated the legislati e process culminating in the enactment of the law must substantially be the same as the House bill would be to deny the ;enateEs power not only to concur with amendments but also to propose amendments. Hence' what the 3onstitution simply means is that the initiati e for filing re enue' tariff or tax bills' bills authori6ing an increase of the public debt' pri ate bills and bills of local application must come from the House of @epresentati es on the theory that' elected as they are from the districts' the members of the house can be expected to be more sensiti e to the local needs and problems. Nor does the 3onstitution prohibit the filing in the ;enate of a substitute bill in anticipation of its receipt of the bill from the House' so long as action by the ;enate as a body is withheld pending receipt of the House bill. ?urther' the argument of Tolentino concerns a mere matter of form. There is no showing that it would ma$e a significant difference if ;enate were to adopt his o er what has been done.

It also pro ided that the !resident may increase such rate to 1-O if any of - conditions are met2 1) HalueFadded tax collection as a percentage of D,! of the pre ious year exceeds two and fourF fifth percent(- .8%O)> or -) national go ernment deficit as a percentage of D,! of the pre ious year exceeds one and oneF half percent (1 18-O). Chen the law howe er was to ta$e effect' a temporary restraining order was issued by the ;upreme 3ourt because of cases filed by the petitioners claiming that the said law is unconstitutional. Among the arguments pro ided by the petitioners for the unconstitutionality of @A (==1 is that it iolated ;ec. -&(1) of Art. HI' re#uiring the uniformity and the progressi ity of taxation

Issue2 Chether @A (==1 is unconstitutional in that it iolates Art. HI' ;ec. -&(1) of the 3onstitution. @uling2 No. @A (==1 is constitutional and does not iolate ;ec. -&(1) of the 3onstitution. ;ec. -&(1)2 The rule of taxation shall be uniform and e#uitable. The 3ongress shall e ol e a progressi e system of taxation. Lniformity in taxation means that all taxable articles or $inds of property of the same class shall be taxed at the same rate. ,ifferent articles may be taxed at different amounts pro ided that the rate is uniform on the same class e erywhere with all people at all times. @A (==1 is uniform as it pro ides a standard rate of "O or 1"O (or 1-O) on all goods and ser ices. ;ec. .' %' and A of @A (==1' amending ;ec. 1"A' 1"1' and 1"&' respecti ely of the NI@3 pro ide for a rate of 1"O (or 1-O) on sale of goods and properties' importation of goods' and sale of ser ices and use or lease of properties' and these same sections also pro ide for "O rate on certain sales and transaction. Howe er' the rule on uniform taxation does not depri e 3ongress of the power to classify sub+ects of taxation' and only demands uniformity with the particular class. @A (==1 is also e#uitable. HAT rate of "O or 1"O (or 1-O) does not apply to sales of goods or ser ices with gross annual sales or receipts not exceeding !1.%7. Also' basic marine and agricultural food products in their original state are still not sub+ect to the tax' ensuring that prices at the grassroots le el will remain accessible. Taxes were imposed to those who were exempted before but in exchange' mitigating measures were pro ided2 4xcise tax on petroleum products and natural gas were reduced. !ercentage tax on domestic carriers was remo ed.

1.. A/ABADA GFRO PARTN <IST, e . 'l. v. ERMITA, e . ?acts2 @A (==1' which amended certain pro isions of the National Internal @e enue 3ode was enacted in consideration of the mounting budget deficit' re enue generation' inade#uate fiscal allocation for education' increased emoluments for health wor$ers' and wider co erage for full alueFadded tax benefits. @A (==1 pro ided a 1"O tax rate on some goods and ser ices.

Course Outline Constitutional Law II !ower producers are not exempt from paying franchise tax. 3ongress also increased the income tax rates of corporations. All these were designed to ease' as well as spread out' the burden of taxation' which would otherwise rest largely on the consumers. ?inally' with regard to progressi ity' it is admitted that the HAT is an antithesis of progressi e taxation. Taxation is progressi e when its rate goes up depending on the resources of the person affected. The HAT paid by the consumer or business for e ery goods bought or ser ices en+oyed howe er' is the same regardless of income K HAT paid eats the same portion of an income' whether big or small. Ne ertheless' the 3onstitution does not really prohibit the imposition of indirect taxes' li$e the HAT. @esort to indirect taxes should be minimi6ed but not a oided entirely because it is difficult' if not impossible' to a oid them by imposing such taxes according to the taxpayerMs ability to pay. 19. Gero$!# v. De"'r men o( Energ%, G.R. No. 15:4:6, 1ul% 14, .334 ?acts @A (1=A' otherwise $nown as the 4lectric !ower Industry@eform Act of -""1 (4!I@A)'which sought to impose auni ersal charge on all endFusersof electricity for the purpose of funding NA!/3/@Es pro+ects' was enacted and too$ effect in -""1. !etitioners contest theconstitutionality of the 4!I@A' stating that the imposition of the uni ersal charge on all endFusers is oppressi e and confiscatory and amounts to taxation without representation for not gi ing the consumers a chance to be heard and be represented. Issue2C8N the uni ersal charge is atax. @uling2N/. The assailed uni ersal charge is not a tax' but an exaction in the exercise of the;tateEs police power. That publicwelfare is promoted may begleaned from ;ec. - of the4!I@A' which enumerates the policies of the ;tate regardingelectrification. 7oreo er' the;pecial Trust ?und feature of theuni ersal charge reasonablyser es and assures the attainmentand perpetuity of the purposesfor which the uni ersal charge isimposed (e.g. to ensure the iability of the countryEs electric power industry)' further boostingthe position that the same is anexaction primarily in pursuit of the ;tateEs police ob+ecti es If generation of re enue is the primary purpose and regulation is merely incidental' the imposition is a tax> but if regulation is the primary purpose' the fact that re enue is incidentally raised does not ma$e the imposition a tax.The taxing power may be used as an implement of police power. The theory behind the exercise of the power to tax emanates from necessity> without taxes'go ernment cannot fulfill its mandate of promoting thegeneral welfare and wellF being of the people