Title
Jose Co Lee vs. City of Olongapo represented by its City Mayor Hon. Rolen C. Paulino
Case
G.R. No. 246201
Decision Date
Dec 7, 2022
City of Olongapo failed to make a valid offer and violated due process in expropriating Lee's property for a civic center; case remanded for trial on defenses.
eminent domain
expropriation
due process
A

Case Digest (G.R. No. 233930)

Facts:

  • Parties and Subject Property
    • Jose Co Lee, the registered owner of a parcel of land located in East Tapinac, City of Olongapo, is the petitioner.
    • The respondent is the City of Olongapo, represented by its City Mayor, Hon. Rolen C. Paulino, empowered to initiate expropriation proceedings.
  • Legislative and Administrative Framework
    • On July 4, 2012, Ordinance No. 12, Series of 2012, was enacted by the Sangguniang Panlungsod of Olongapo, reclassifying certain government properties into an institutional/mixed zone for the construction of a new civic center complex.
    • Ordinance No. 12 provided the definitions for institutional/mixed use and mixed-use development, emphasizing the coexistence of multiple revenue-producing and institutional uses.
    • Ordinance No. 12 was later amended by Ordinance No. 19, Series of 2014.
    • Ordinance No. 15, Series of 2015, was subsequently passed to authorize then-City Mayor Paulino to expropriate parcels of land in East Tapinac for the development of a civic center complex, including facilities such as the Disaster Risk Reduction Management Office, City Museum, City Public Library, and a satellite office of the Red Cross.
  • Negotiated Sale Offer and Rejection
    • On December 23, 2014, the City initiated contact via a Notice of Negotiated Sale or Expropriation sent to Lee, stating that a mixed-use development plan affecting his property had been approved.
    • A follow-up letter dated March 24, 2015, reiterated the planned use for the property and offered PHP 13,824,000.00, which Lee rejected.
  • Filing of Expropriation Proceedings and Court Actions
    • When no agreement was reached, the City, represented by Mayor Paulino, filed a Complaint for Expropriation.
    • On August 28, 2015, the City filed a Manifestation with Motion before the Regional Trial Court and deposited PHP 239,760.00, seeking immediate possession of the property.
    • Lee filed his Answer, raising numerous objections including:
      • The complaint failing to state a proper cause of action for expropriation.
      • Allegations that the expropriation was not for public use and that the requisite offer and negotiations were deficient.
      • Questioning the authority of the Sangguniang Panlungsod’s resolution to empower Mayor Paulino for filing the complaint and signing its verification.
      • Disputing the method of calculating just compensation, invoking The Right-of-Way Act.
  • Trial Court and Appellate Proceedings
    • During the trial on May 5, 2016, Lee was called to identify his Judicial Affidavit; however, an objection was raised by the City’s counsel regarding its use for proving affirmative defenses.
    • The Regional Trial Court issued orders allowing an opportunity for comments and subsequently dismissed Lee’s affirmative defenses without a full trial and hearing.
    • The trial court declared that the City of Olongapo had a lawful right to expropriate Lee’s property, directing the parties to submit names for commissioners to determine just compensation.
    • Lee’s motion for reconsideration before the trial court was denied.
    • The Court of Appeals later affirmed the ruling of the Regional Trial Court, holding that:
      • Mayor Paulino, under Ordinance No. 15, executed the necessary authority to file the complaint and sign verification.
      • The validity of the expropriation was supported by the enacted ordinances showing proper public use.
      • The City's deposit and efforts, including the offer which was rejected by Lee, satisfied procedural requirements.
      • Lee’s affirmative defenses were properly dismissed as they had not been supported by a trial hearing.
  • Petitioner’s Arguments on Appeal
    • Lee contended that his due process rights were violated by:
      • The absence of a full-blown trial on his affirmative defenses, which required the presentation of evidence aliunde.
      • The failure to prove that the expropriation was for public use rather than for the benefit of a private entity (SM Prime Holdings, Inc.).
      • The improper calculation and handling of just compensation based on The Right-of-Way Act provisions.
    • He also questioned the authority and actions of Architect Tony Kar M. Balde III in negotiating a sale, asserting that such conduct should not confer legitimacy on the expropriation process.
  • Legislative Basis and Procedural Requirements
    • The exercise of eminent domain by local government units is governed by Section 19 of the Local Government Code of 1991, which:
      • Delegates the power of eminent domain to the chief executive upon the enactment of an ordinance.
      • Requires that a valid and definite offer be made to the owner prior to initiating expropriation proceedings.
      • Mandates the payment of just compensation and prescribes conditions for taking immediate possession of the property.
    • The Right-of-Way Act, though primarily aimed at national infrastructure projects, provides contrasting guidelines when applicable, particularly regarding the deposit of 100% of the relevant zonal valuation as just compensation.

Issues:

  • Whether Mayor Paulino, under Ordinance No. 15, had the proper legal authority to initiate the expropriation proceedings and sign the verification and certification of nonforum shopping.
  • Whether the City of Olongapo complied with the statutory requirement of making a valid and definite offer prior to initiating expropriation, including exhausting all reasonable efforts to negotiate a sale with petitioner Lee.
  • Whether Lee’s due process rights were violated when his affirmative defenses were dismissed without a full trial and hearing to present evidence.
  • Whether the expropriation was truly for public use, specifically for the development of a civic center complex, or if it was improperly influenced by private interests, as alleged by the petitioner.
  • Whether the City’s deposit for immediate possession of the property was correctly determined in light of the differing statutory requirements under the Local Government Code and The Right-of-Way Act.

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

Doctrine:

  • (Subscriber-Only)
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