G.R. No. 211666 - Republic vs. Soriano

On October 20, 2010, the Republic of the Philippines, represented by the Department of Public Works and Highways (DPWH), filed a Complaint for expropriation against respondent Arlene R. Soriano.
The subject property consists of 200 square meters located at Gen. T. De Leon, Valenzuela City, covered by Transfer Certificate of Title (TCT) No. V-13790.
The expropriation was pursuant to Republic Act (RA) No. 8974, to facilitate right-of-way acquisition for the North Luzon Expressway (NLEX)-Harbor Link Project (Segment 9).

DPWH deposited P420,000.00, representing 100% of the zonal value as just compensation for the property.
The RTC, Valenzuela City, Branch 270, issued a Writ of Possession and Writ of Expropriation on May 27, 2011 after respondent failed to appear despite notice.
Initially, a Board of Commissioners was appointed to determine just compensation but was revoked for failing to file a report.
The parties were allowed to submit position papers; petitioner presented evidence that P2,100.00 per square meter based on the BIR zonal value was just compensation. Tax Declaration showed a lower rate of P400.00 per square meter.
Evidence revealed the property was poorly maintained, far from commercial/industrial areas, with sub-standard surroundings. Respondent was deemed to have waived evidence due to absence.

Declared the plaintiff’s lawful right to acquire possession and title to the 200 sqm parcel.
Ordered condemnation of the property free from liens and encumbrances.
Ordered payment of Php420,000.00 as just compensation at Php2,100.00/sqm with 12% legal interest per annum from the taking date.
Ordered payment of consequential damages including transfer taxes.
Directed annotation of the decision on the TCT.

Petitioner’s payment was through two Manager’s Checks, but these were declared stale; RTC ordered issuance of a new check.
Petitioner moved for reconsideration to reduce interest rate to 6% citing BSP Circular No. 799, 2013.
RTC, in its Order dated March 10, 2014, reduced the interest rate to 6% per annum based on Article 2209 of the Civil Code, rejecting the BSP Circular application. It relied on National Power Corporation v. Angas reasoning.

Disallow legal interest of 6% per annum alleging no delay in payment.
Argue respondent should pay transfer taxes based on the National Internal Revenue Code and Local Government Code.

Petitioner contended interest is only due if property taken before compensation deposit; here, compensation was deposited before possession.
Petitioner argued consequential damages were improper as entire property was taken; no impairment to remaining property.
Petitioner denied liability for transfer taxes (capital gains and documentary stamp tax).

Whether legal interest should be imposed on just compensation given that payment was deposited before taking possession.
Whether consequential damages should be awarded when the entire property was expropriated.
Who is liable for the transfer taxes, specifically capital gains tax and documentary stamp tax, in expropriation cases.