Case Digest (G.R. No. 169453)
Facts:
The case involves Capitol Steel Corporation (petitioner) and the Phividec Industrial Authority (respondent). Capitol Steel is a domestic corporation that owns 65 parcels of land totaling 337,733 square meters located in the barrios of Sugbongcogon and Casinglot, Tagoloan, Misamis Oriental. Phividec, a government-owned corporation established under Presidential Decree No. 538, is tasked with the development of industrial areas and has the power of eminent domain for acquiring property for government projects. The properties owned by Capitol Steel were identified as suitable for the Mindanao International Container Terminal Project (MICTP), a project aimed at enhancing port facilities in Mindanao.
On August 24, 1999, Phividec filed an expropriation case against Capitol Steel, which was assigned to Branch 38 of the Regional Trial Court (RTC) of Misamis Oriental. The RTC issued a writ of possession on September 1, 1999, but the case was later dismissed due to Phividec's imp...
Case Digest (G.R. No. 169453)
Facts:
Background of the Parties
- Petitioner: Capitol Steel Corporation (Capitol Steel), a domestic corporation, owns 65 parcels of land totaling 337,733 square meters in Sugbongcogon and Casinglot, Tagoloan, Misamis Oriental.
- Respondent: Phividec Industrial Authority (PHIVIDEC), a government-owned and controlled corporation created under Presidential Decree No. 538, is vested with governmental and proprietary functions, including the power of eminent domain for industrial development.
Expropriation Proceedings
- PHIVIDEC identified Capitol Steel's properties as the ideal site for the Mindanao International Container Terminal Project (MICTP), a project aimed at handling seaborne traffic in Mindanao.
- On August 24, 1999, PHIVIDEC filed an expropriation case (Civil Case No. 99-477) before the Regional Trial Court (RTC) of Misamis Oriental, Branch 38, and obtained a writ of possession on September 1, 1999.
- The case was dismissed due to PHIVIDEC's unauthorized engagement of a private lawyer, but PHIVIDEC was allowed to refile the case.
Revaluation of Properties
- Capitol Steel requested the Technical Committee on Real Property Valuation (TCRPV) of the Bureau of Internal Revenue (BIR) to revalue its properties. The TCRPV issued Resolution No. 36-2001, fixing the zonal valuation at P700 per square meter.
- PHIVIDEC, however, relied on Department Order No. 40-97 (D.O. 40-97), which set the zonal valuation at P300 and P500 per square meter for Sugbongcogon and Casinglot, respectively.
Second Expropriation Case
- PHIVIDEC re-filed the expropriation case (Civil Case No. 2003-346) on November 24, 2003, and deposited P116,563,500, representing 100% of the zonal value under D.O. 40-97.
- Capitol Steel opposed the motion for a writ of possession, arguing that the TCRPV Resolution (P700 per square meter) should govern.
- The RTC denied PHIVIDEC's motion, finding the deposit inadequate and ordering a judicial determination of the property's value.
Court Proceedings
- The RTC sustained the TCRPV's valuation of P700 per square meter and ordered PHIVIDEC to deposit the corresponding amount.
- PHIVIDEC filed a petition for certiorari before the Court of Appeals, which ruled in favor of PHIVIDEC, holding that D.O. 40-97 should govern the provisional value of the properties.
Issue:
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Ruling:
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Ratio:
- Zonal Valuation under D.O. 40-97: The BIR's zonal valuation, as established under D.O. 40-97, is the legally recognized basis for determining the provisional value of properties in expropriation cases. The TCRPV Resolution, which was not properly promulgated in accordance with Revenue Memorandum Order No. 56-89, cannot override the BIR's official valuation.
- Procedural Compliance: The TCRPV's revaluation process lacked the necessary public hearings and notices required by law, rendering its resolution ineffective.
- Writ of Possession: Under Republic Act No. 8974, the deposit of 100% of the zonal value is sufficient for the issuance of a writ of possession. The RTC's refusal to issue the writ based on the TCRPV Resolution was erroneous.
- Procedural Defects: The Court of Appeals correctly ruled that PHIVIDEC's failure to attach certain documents did not deprive it of jurisdiction or prejudice Capitol Steel.
Conclusion:
The Supreme Court upheld the Court of Appeals' decision, affirming that the zonal valuation under D.O. 40-97 governs the provisional value of the properties for the issuance of a writ of possession. The TCRPV Resolution, lacking procedural compliance, was not binding. PHIVIDEC's petition for certiorari was not fatally defective, and the RTC's refusal to issue the writ was overturned.