Manila Banking Corporation vs. BCDA, G. R. No. 230144 (2018) Topic: Just Compensation Doctrines

109. Manila Banking Corporation vs.
BCDA,
G. R. No. 230144 (2018)
Topic: Just Compensation
Doctrines:
 Time and again, this Court has ruled that the determination of just compensation must be based on reliable
and actual data.
In Republic v. Asia Pacific Integrated Steel Corporation: “just compensation "as the full and fair equivalent
of the property taken from its owner by the expropriator. The measure is not the taker's gain, but the
owner's loss. The word 'just' is used to intensify the meaning of the word 'compensation' and to convey
thereby the idea that the equivalent to be rendered for the property to be taken shall be real, substantial,
full, and ample. Such 'just'-ness of the compensation can only be attained by using reliable and actual data
as bases in fixing the value of the condemned property. Trial courts are required to be more circumspect in
its evaluation of just compensation due the property owner, considering that eminent domain cases involve
the expenditure of public funds."
 National Power Corporation v. Tuazon: "[t]he determination of just compensation in expropriation cases is
a function addressed to the discretion of the courts, and may not be usurped by any other branch or official
of the government. This judicial function has constitutional raison d'etre; Article III of the 1987 Constitution
mandates that no private property shall be taken for public use without payment of just compensation."
 Legislative enactments, as well as executive issuances, fixing or providing for the method of computing just
compensation are tantamount to impermissible encroachment on judicial prerogatives. They are not
binding on courts and, at best, are treated as mere guidelines in ascertaining the amount of just
compensation.
Facts:
In 2003, BCDA filed a complaint against The Manila Banking Corporation (TMBC) seeking to expropriate a
166,355 square meter parcel of land in Pampanga registered in the name of TMBC. BCDA alleged that the
property was classified as agricultural land and had the zonal value of P30 per square meter at the time of filing
of the complaint. Records reveal that a Final Offer to Buy in 2003 was sent by BCDA to TMBC, whereby BCDA
offered the price of P75 per square meter for the subject property.
In 2005, the RTC declared that BCDA has clearly established its lawful right to take the property sought to be
expropriated for public use or purpose upon the payment of just compensation. The parties were ordered to
submit their nominations for the commissioners who will assist the trial court in arriving at the just
compensation for the subject property.
The Commissioners did not come up with a group report, but made individual reports after their ocular
inspection. Engr. Tolosa submitted an appraisal of P388 per square meter. Engr. Lansangan recommended that
the Fair Market Value of the property is P350 per square meter. The Report of Mr. Murillo submitted an
appraisal of P30 per square meter which according to him was based at the time of taking and was reasonable
and fair enough to both parties considering that the subject property consisted only agricultural lands which
have a lower value than industrial or commercial lots.
RTC ordered BCDA to pay TMBC the amount of P250 per square meter as just compensation for the property.
RTC issued an Order (2014 order) granting BCDA's motion for reconsideration fixing the just compensation at
P190 per square meter.
BCDA elevated the case to the CA, seeking to reverse the RTC's determination of just compensation.
CA ruled in favor of BCDA. CA fixed the amount of just compensation to P75 per square meter.
In reversing and setting aside the trial court's determination of just compensation, the CA reviewed the reports
submitted by the commissioners, as well as the trial court's 2012 Decision and 2014 Order. The CA noted that
while the trial court based its first valuation on the recommendations of the commissioners, it did not give any
explanation on how it arrived at the amount of P250 per square meter. As for the second valuation of P190, the
CA observed that the trial court gave more weight to two documents included in Engr. Tolosa's Repor t,
specifically: 1) Resolution No. 12-2006 of the DPWH Provincial Appraisal Committee which fixed the just
compensation of an expropriated land for the PoracMancatian Dike Project at P190 per square meter and 2)
Deed of Absolute Sale between TMBC and DPWH over the property taken in the area for the price of P190 per
square meter.
ISSUE:
Whether the CA erred in awarding just compensation at the rate of P75 per square meter, instead of P250 per
square meter as originally ordered by the RTC in its September 4, 2012 Decision, or P190 per square meter as
reconsidered by the RTC in its 2014 Order. (NO)
RULING:
The CA was correct in reversing the trial court and in fixing the just compensation at P75 per square meter
Section 5 of RA 8974 provides:

Section 5. Standards for the Assessment of the Value of the Land Subject of Expropriation
Proceedings or Negotiated Sale. - In order to facilitate the determination of just compensation, the court may
consider, among other well-established factors, the following relevant standards:
(a) The classification and use for which the property is suited
(b) The developmental costs for improving the land;
(c) The value declared by the owners;
(d) The current selling price of similar lands in the vicinity
(e) The reasonable disturbance compensation for the removal and/or demolition of certain
improvements on the land and for the value of improvements thereon;
(f) The size, shape or location, tax declaration and zonal valuation of the land;
(g) The price of the land as manifested in the ocular findings, oral as well as documentary
evidence presented; and
(h) Such facts and events as to enable the affected property owners to have sufficient funds to acquire
similarly-situated lands of approximate areas as those required from them by the government, and thereby
rehabilitate themselves as early as possible.
There is no question that at the time of taking of the subject property, it was classified as agricultural land,
based on the records of the Municipal Assessor's Office of Porac, Pampanga.
Engr. Lansangan's Report could not be given any weight since he did not provide any explanation for arriving at
his recommendation of P350 per square meter, except for his declaration that he arrived at the same based on
the price information he had and current land usage in the locality.
Engr. Lansangan clarified that his recommendation was based on the reclassification of the property to
residential, commercial and industrial areas, the BIR Zonal Valuation as industrial area with assessed value of
P200 per square meter, and the value for residential area at P500 per square meter, the average of which is
P350 per square meter. However, Engr. Lansangan's recommendation was erroneous since it was established
that the subject property was not included in the area which was reclassified by the province . Furthermore, the
reclassification was made after the time of taking of the subject property; thus, any change in valuation as a
result thereof would have no bearing on the amount of just compensation.
As for Engr. Tolosa's Report, his recommendation to set the just compensation for the subject property at the
amount of P388 per square meter was mostly based on the market approach, where the value of the land is
based on sales and listings of comparable properties within the vicinity. While this approach is an acceptable
basis to determine just compensation, the data gathered by Engr. Tolosa on which he relied his
recommendation were based on current market values at the time of the ocular inspection which was on
October 6, 2011— almost eight years from the time of taking of the subject property in November 2003.
In arriving at the amount of P250 per square meter, the trial court relied on the eight DPWH transactions of
neighboring properties as relevant market data on the actual value of the subject property in November 2003.
The RTC failed to consider the nine Deeds of Absolute Sale between BCDA and several landowners for the sale
of properties situated in Barangay Dolores, Porac, Pampanga with selling price ranging from P60 to P75 per
square meter, which were executed between March 2004 and September 2008. The RTC reasoned that the
BCDA allegedly failed to establish the proximity of these properties with the subject property.
As correctly observed by the CA, the properties subject of the nine deeds of absolute sale were directly
contiguous and adjacent to the subject property.
The RTC committed a reversible error for it is plainly obvious that the areas expropriated for the SCTEX project
are contiguous and adjacent properties. Specifically, the lands covered by no less than nine (9) Deeds of
Absolute Sale are all situated in Barangay Dolores, Municipality of Porac, Province of Pampanga. BCDA's offer to
buy the subject property at Php75.00 per square meter was the same selling price of its neighboring properties
affected by the same infrastructure project. Such price is also based on the following factual considerations: (1)
the nature of the subject property as agricultural land with no improvements ("no electricity,
no road outlet and not accessible to regular mode of transportation"); (2) the zonal valuation by the BIR
(Php30.00 per square meter); and (3) tax declarations ("Agricultural-Sugar") indicating the total market value of
the subject property at Php27,400.

Manila Banking Corporation vs. BCDA, G. R. No. 230144 (2018) Topic: Just Compensation Doctrines

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Manila Banking Corporation vs. BCDA, G. R. No. 230144 (2018) Topic: Just Compensation Doctrines

Uploaded by

Copyright:

Available Formats

109. Manila Banking Corporation vs.

Topic: Just Compensation

Section 5 of RA 8974 provides:

You might also like