Facts:

B.H. Berkenkotter & Co., filed a petition against the Court of Appeals and the Republic of the Philippines concerning the just compensation for a parcel of land measuring 10,640 square meters located in Nasugbu, Batangas, which was sought for expropriation by the Apolinario R. Apacible School of Fisheries (ARASOF). The events leading to this legal dispute began on June 18, 1982, when Vicente Viray, the president of ARASOF, sent a written offer to purchase the said land at a price of P50.00 per square meter. Berkenkotter replied, asserting its willingness to sell at that price. Consequently, the Provincial Appraisal Committee appraised the property and set its market value at P32.00 per square meter. In subsequent negotiations, Berkenkotter emphasized that the property had appreciated to P100.00 per square meter, while ARASOF maintained the P32.00 offer. After failing to reach an agreement, the Republic initiated expropriation proceedings against Berkenkotter on October 28, 1

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Facts:

Background and Parties Involved

• The case arises from an expropriation proceeding for a parcel of land measuring 10,640 square meters in Nasugbu, Batangas.
• Petitioner: B.H. Berkenkotter & Co., through its President George E. Berkenkotter.
• Respondents: The Court of Appeals and the Republic of the Philippines, acting on behalf of the Apolinario R. Apacible School of Fisheries (ARASOF).

Initiation of Negotiations and Appraisals

• On June 18, 1982, Vicente Viray, president of ARASOF, initiated negotiations by sending a written offer to buy the land in connection with the school’s five-year expansion program.
• Berkenkotter initially stated its willingness to sell at P50.00 per square meter payable in cash, later asserting that the land’s value had appreciated to as high as P100.00 per square meter.
• At Viray’s request, the Provincial Appraisal Committee of the Office of the Provincial Assessor in Batangas City appraised the property at P32.00 per square meter, and Viray subsequently made an offer at that appraisal value.

Breakdown in Negotiations and Commencement of Expropriation

• Despite the exchange of offers, negotiations failed to reconcile the difference in valuation between the parties.
• The Republic, through ARASOF, commenced expropriation proceedings against the petitioner.
• In its complaint dated October 28, 1983, the Republic relied on the appraisal of P32.00 per square meter and invoked the deposit requirement under Presidential Decree No. 48.

Trial Court Proceedings and Commissioner's Panel

• On March 21, 1985, the Regional Trial Court of Batangas issued an order of condemnation and, in accordance with Rule 67, Section 5, appointed a panel of commissioners to determine just compensation.
• The panel, after conducting an ocular inspection and numerous interviews of local persons familiar with land values, first recommended a valuation of P85.00 per square meter (report submitted September 23, 1985).
• After further evidence and additional interviews, the panel reaffirmed its recommendation at P85.00 per square meter in its second report dated April 1, 1987.

Evidence of Comparable Private Sales

• The petitioner had entered into three deeds of sale in 1985 for adjacent tracts of land with similar topography.
• The deeds, referenced as Exhibits 1, 2, and 3, recorded a uniform sale price of P19.18 per square meter for properties measurably comparable to the subject land.
• The Republic presented these contracts of sale, arguing that these transactions reliably indicated the true market value of the property.

Petitioner's Arguments and Subsequent Proceedings

• The petitioner contended that the fair market valuation should be higher, citing evidence including:
• Resolution No. 2-83 from the Provincial Appraisal Committee setting the value at P32.00 per square meter.
• An offer by ARASOF through Mr. Vicente Viray at P32.00 per square meter.
• An appraisal report by G. Ambrosio, Inc. assessing the land at P95.00 per square meter.
• Testimonies from relevant realty experts indicating neighboring lots were being sold at rates ranging from P200.00 to P500.00 per square meter.
• The petitioner further argued that the deeds of sale were unreliable, as they allegedly reflected undervalued considerations to evade higher documentary taxes and fees, and that disregarding the panel’s detailed report would amount to a violation of due process.

Development of the Case

• The trial court, based on the panel’s recommendation, initially ruled that the expropriation would be at P85.00 per square meter totaling P904,400.00.
• The Court of Appeals reversed the trial court’s decision, emphasizing the reliability of the deed sales indicating a market value of P19.18 per square meter, and accordingly reduced the compensation to a total of P204,075.20 (including the 10% deposit already paid).

Issue:

Appropriateness of Valuation

• Whether the just compensation should be based on the panel of commissioners’ appraisal of P85.00 per square meter or on the evidence of private sales at P19.18 per square meter.

Reliability and Weight of Evidence

• Whether the deeds of sale, despite concerns of potential undervaluation due to tax avoidance, can serve as reliable evidence in determining fair market value.
• Whether the commissioner's report—which was based on extensive interviews and an ocular inspection—should be given controlling weight in establishing just compensation.

Consistency in Valuation

• Whether it is equitable and just for the petitioner to assert a higher valuation for expropriation purposes while having sold similar parcels at a markedly lower price.
• Whether the claim of liquidity problems justifies the discrepancy in the valuation between the earlier private sales and the claimed value for the subject property.

Due Process in Valuation Adjustments

• Whether the trial court’s disregard of the panel’s report in favor of private sale evidence violates procedural due process.

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Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)