Facts:

The case involves a petition for review on certiorari filed by the Air Transportation Office (ATO), the Department of Public Works and Highways (DPWH), and the Mactan-Cebu International Airport Authority (MCIAA) against Angeles Urgello Tongoy and the heirs of Pilar U. Arcenas, namely, Enrique Arcenas, Monette Arcenas Sanchez, Renato U. Arcenas, Patricia Arcenas Ting, Roy U. Arcenas, Victor U. Arcenas, and Rosendo U. Arcenas. The events leading to this case began in 1963 when the Republic of the Philippines initiated expropriation proceedings for the improvement and expansion of the Lahug Airport in Cebu City, which affected Lot Nos. 913-F and 913-G owned by the respondents. The trial court ruled in favor of the government, prompting the respondents to appeal. However, during the appeal, the parties reached a verbal compromise agreement wherein the respondents agreed to withdraw their appeal in exchange for a commitment that the lots would be resold to them at the original exp...

Facts:

Expropriation and Affected Properties

• In 1963, the Republic of the Philippines initiated expropriation proceedings for the improvement and expansion of Lahug Airport in Cebu City.
• Among the properties expropriated were Lot No. 913-F and Lot No. 913-G, owned respectively by Angeles U. Tongoy and Pilar U. Arcenas (represented by her heirs Enrique, Monette, Renato, Patricia, Roy, Victor, and Rosendo Arcenas).
• The expropriated lots were intended for the development and enlargement of the airport facility.

The Verbal Compromise Agreement

• Pending the outcome of the appeal filed by the respondents against the trial court’s initial ruling in favor of the government, the parties entered into a verbal compromise agreement.
• Under this agreement, the respondents agreed to withdraw their appeal in exchange for a future repurchase commitment: that the expropriated lots would be resold to them at the same price at which they were originally expropriated in the event the Civil Aeronautics Administration (CAA) later abandoned the Lahug Airport.
• Despite the compliance with the agreement, the lot titles were eventually transferred to the government pursuant to the expropriation.

Developments on the Airport’s Use and Management

• The intended airport expansion did not materialize as initially planned because the Air Transportation Office (ATO)—the successor to the CAA—decided to transfer its operations to Mactan Airbase.
• In lieu of airport expansion, the government opted to lease out the area of the Lahug Airport, and the Department of Public Works and Highways constructed a building on a portion of the expropriated properties.

Attempts to Repurchase the Lots

• Shortly after the expropriation, in 1964, the respondents made an initial request to repurchase the lots in line with the verbal commitment.
• On August 10, 1964, the CAA responded by indicating the possibility that the Lahug Airport might still be needed for emergency operations, though it referenced the policy of giving pre-emptive priority to the former owners should disposal occur.
• In 1967, further reiteration was made by the respondents—citing an executive order by President Ferdinand Marcos directing the closure of Lahug Airport and the transfer of operations to Mactan Airbase—only to be met with a communication from the CAA reaffirming that no abandonment of the airport was planned at that time.

Administrative and Legal Reassignments

• In a memorandum dated November 29, 1989, President Corazon Aquino directed the transfer of general aviation operations from Lahug Airport to the Mactan International Airport with a view to eventually closing the former.
• Subsequently, under Republic Act No. 6958, the management and aeronautic operations of Lahug Airport were transferred to the Mactan-Cebu International Airport Authority (MCIAA).

Litigation and Trial Court Proceedings

• In 1992, respondents initiated legal action in the Regional Trial Court (RTC) in Cebu City seeking recovery of possession and reconveyance of ownership of Lot Nos. 913-F and 913-G, along with claims for damages.
• The petitioners (comprising the Air Transportation Office, the Department of Public Works and Highways, and MCIAA) failed to adduce any testimonial or documentary evidence and did not cross-examine the respondents’ witness or submit a memorandum within the given time.
• On December 27, 1995, the RTC rendered a decision ordering:
• The restoration of possession and ownership of the disputed lots to the respondents.
• The removal of all improvements on the lots upon reimbursement to respondents of the just compensation initially paid during expropriation.
• Directive to the Register of Deeds of Cebu City to issue new transfer certificates of title in the name of the respondents upon payment of the requisite fees.
• The RTC found that the respondents had sufficiently proven the existence of the oral agreement that granted them a right to repurchase the properties at the original expropriation price if the airport was abandoned.

Appellate Level Review

• Petitioners appealed the RTC decision, but the Court of Appeals (CA) affirmed the judgment on March 31, 2004, and later denied further reconsideration in its resolution on August 2, 2006.
• The central issue remained focused on whether the respondents were able to prove the existence of the oral compromise agreement authorizing their repurchase rights.
• The CA’s findings were supported by precedents, particularly from the case involving the heirs of Timoteo Moreno and Maria Rotea, which established the recognition of the government’s commitment to allow repurchase of expropriated lands under similar circumstances.

Issue:

• Whether the respondents were able to prove that there was an existing oral compromise agreement that entitled them to repurchase the expropriated lots at the same price paid during expropriation.
• Whether the petitioners failed to rebut the evidence adduced by the respondents regarding such an agreement.
• The applicability of prior case law and government policies in establishing the enforceability of such an oral commitment.

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)