G.R. No. 76647 - Amorsolo vs. People

Petitioner: Republic of the Philippines, represented by the Department of Public Works and Highways (DPWH).
Respondents: Heirs of spouses Pedro Bautista and Valentina Malabanan, the registered owners of a 1,893‑square meter parcel of land in Barangay Bulacnin North, Lipa City (covered by Transfer Certificate of Title No. 41750).

In 2000, DPWH acquired by negotiated sale a 36‑square meter portion of the lot for P46,800.00 or at P1,300.00 per square meter for the STAR (Southern Tagalog Arterial Road) Tollway project.
The sale was duly annotated on the title on June 1, 2000.

Later, the petitioner offered to purchase an additional 1,155‑square meter portion of the lot (the subject portion) intended for the Balete‑Lipa City Interchange Ramp B, a facility for vehicular entry and exit.
The spouses Bautista, owners of the property, refused to sell the additional portion.
On July 7, 2004, the petitioner filed a Complaint for expropriation of the subject portion in the Regional Trial Court of Lipa City (Civil Case No. 2004‑0408, Branch 12).
After the spouses passed away, the respondents (their children) were substituted as parties to the case.

The petitioner, in its Amended Complaint, alleged that the fair market value of the subject portion should be based on the Bureau of Internal Revenue (BIR) zonal valuation of P100.00 per square meter.
Respondents argued that the valuation must reflect a higher market value (at least P3,000.00 per square meter) considering:

The trial court, during the expropriation proceedings, authorized the petitioner to take possession of the subject portion upon depositing P115,500.00 with the Land Bank of the Philippines.
A panel of commissioners (the Lipa City Assessor and the Registrar of Deeds, with an additional commissioner, Nimfa Martinez‑Mecate, on opposition) was constituted to ascertain the just compensation.
Two separate commissionersa reports were submitted:

The Joint Commissionersa Report (May 3, 2005) by the Lipa City Assessor and the Registrar of Deeds recommended a valuation of P1,960.00 to P2,500.00 per square meter.
Mecate’s Report (April 25, 2005) considered various factors such as tax declarations, the BIR zonal valuation, and local appraisal figures, recommending lower rates for agricultural, orchard, and sugar land (P400.00 per square meter) and P600.00 per square meter for residential and commercial classifications.

On August 18, 2005, the trial court fixed the just compensation for the subject portion at P1,960.00 per square meter, amounting to a total of P2,263,800.00.
The decision validated the public purpose of the expropriation and adopted the Joint Commissionersa Report’s recommended valuation.
Petitioner appealed the trial court’s decision to the Court of Appeals (CA), contesting:

The exclusive reliance on the Joint Commissionersa Report.
The failure to incorporate all documentary evidence and factors (assessed value, tax declarations, etc.) to arrive at just compensation under the applicable legal standards.

The CA affirmed the trial court’s decision, with modification to deduct the prior deposit of P115,000.00 from the total compensation.

The trial court and the CA erred in determining the just compensation.
The reliance on the Joint Commissionersa Report was flawed and did not account for all relevant factors mandated by law (e.g., standards set forth in RA No. 8974).

The substantive issue revolved around the proper valuation or just compensation for the expropriated subject portion.

Whether the Court of Appeals erred in affirming the trial court’s decision fixing just compensation at P1,960.00 per square meter by failing to consider all legally prescribed factors in determining just compensation.

The petitioner contended that the valuation did not adequately account for all relevant evidence (such as the assessed value, tax declaration, BIR zonal valuation, and other appraisal reports).

Whether the reliance on the Joint Commissionersa Report, which recommended a valuation of P1,960.00 per square meter, was erroneous, excessive, speculative, and contrary to established rules and jurisprudence on determining just compensation.

The petitioner argued that the report neglected important standards enunciated in RA No. 8974.