G.R. No. 217656 - Department of Public Works and Highways vs. Manalo

The case involves the Department of Public Works and Highways (DPWH) as petitioner and a large group of respondents—Eddie Manalo, Rodrigo Medianista, Cristan A. Acosta, Teresita D. Santos, and others—who are residents and owners of residential structures built on a parcel of land located on Luzon Avenue, Quezon City.
The land in question is owned by the Metropolitan Waterworks and Sewerage System and lies directly along the route of the DPWH’s planned C-5 extension project.
The C-5 extension project was aimed at linking the South Luzon Expressway and the North Luzon Expressway, thereby easing traffic congestion on major thoroughfares.

Respondents filed a Complaint on September 13, 2010, before the Regional Trial Court (RTC) of Quezon City seeking determination and payment of just compensation for the expropriated properties.
In their Complaint, respondents alleged that although the DPWH had the power of expropriation, it had not initiated proper expropriation proceedings and instead “cut corners” to expedite the project.
Respondents contended that the offered financial assistance was “notoriously small” and insisted on being paid the replacement costs of their houses, similar to a precedent involving informal settlers at Barangay UP Campus.

Respondents cited an August 6, 2008 Memorandum of Agreement entered into between the DPWH and the Quezon City government.
The agreement acknowledged the status of the affected occupants as informal settlers and laid out responsibilities regarding the clearance of road right-of-way and relocation of squatters.
Respondents argued that the existence of this memorandum underscored their entitlement to just compensation rather than mere financial assistance.

On November 15, 2010, a Notice of Demolition was issued by the Quezon City Task Force, requiring respondents to vacate the land within seven days, accompanied by an offer of financial assistance (P21,000.00 per family), which respondents refused.
DPWH filed an Answer on January 19, 2011, praying for the dismissal of the Complaint, alleging that respondents were illegal occupants (squatters) and, by dint of admitting such, were not entitled to replacement cost reimbursement.
On May 5, 2011, the RTC denied the DPWH’s motion to dismiss, finding that the allegations in the Complaint stated a cause of action, which was affirmed by the Court of Appeals on March 19, 2015, dismissing the petition for certiorari on lack of merit.

DPWH eventually filed a Petition for Review on Certiorari before the Supreme Court, contesting the RTC’s reliance on the memorandum and asserting that respondents’ entitlement was limited to financial assistance under Republic Act No. 7279.
Respondents, through their Comment and further pleadings, maintained that they were entitled either to just compensation or suitable relocation, relying on both constitutional mandates and relevant statutory provisions.
The Supreme Court was tasked with addressing whether the lower courts erred in denying DPWH’s dismissal motion, whether DPWH could summarily evict and demolish the structures, and whether respondents were entitled to just compensation.

DPWH argued that the Complaint failed to state a cause of action by alleging that the monitoring of the expropriation and the consideration of the memorandum should have precluded judicial review.
It further argued that expropriation proper was not the remedy available as the proper action should involve summary eviction and demolition under Republic Act No. 7279 due to the respondents being “professional squatters” or builders in bad faith.
Respondents contended that once the DPWH made a voluntary offer of financial assistance, their rights were clearly acknowledged, and the failure to apply proper expropriation procedures and observe mandatory due process rendered the eviction and demolition actions illegal.

Whether the Court of Appeals erred in affirming the RTC’s denial of the DPWH’s prayer to dismiss the Complaint on the ground that the Complaint stated a cause of action.

Determining if the allegations in the Complaint, taken as true, sufficiently established the three essential elements (legal right, correlative obligation, and a defendant’s violation) for a cause of action.
Analyzing whether the memorandum and related pleadings could be considered by the trial court to support respondents’ claims.

Whether the DPWH is entitled to extrajudicially and summarily evict the respondents and demolish their structures without observing due process and the mandatory procedural requirements under Republic Act Nos. 7279 and 8974.

Evaluating if the eviction and demolition procedures followed the Constitution, particularly the provisions for protection of the urban and rural poor dwellers.
Considering if the DPWH’s offer of financial assistance sufficed as a substitute for proper judicial expropriation procedures.

Whether respondents are entitled to just compensation for the structures that were demolished or are subject to demolition.

Exploring the respondents’ entitlement either to monetary compensation equivalent to the replacement cost or to a suitable relocation under the applicable statutory and constitutional provisions.
Assessing the legal implications of labeling the respondents as “professional squatters” versus underprivileged and homeless citizens.