Title
Source: Supreme Court
Republic vs. Spouses Bunsay
Case
G.R. No. 205473
Decision Date
Dec 10, 2019
DPWH expropriated Spouses Bunsay's property for a road project. SC ruled no consequential damages since entire property was taken but ordered DPWH to cover CGT and transfer taxes as part of just compensation.

Case Digest (G.R. No. 205473)
Expanded Legal Reasoning Model

Facts:

  • Parties and Subject Matter
    • The petitioner is the Republic of the Philippines, represented by the Department of Public Works and Highways (DPWH).
    • The respondents are Spouses Marcelino and Nenita Bunsay.
    • The subject is a 100-square meter lot in Valenzuela City covered by Transfer Certificate of Title (TCT) No. V-16548 (referred to as the Disputed Property).
    • The controversy arose from DPWH’s expropriation of the Disputed Property for the C-5 Northern Link Road Project Phase 2 (Segment 9).
  • Procedural History and Trial Court Proceedings
    • DPWH filed a Complaint for Expropriation with Urgent Prayer for Issuance of Writ of Possession against Spouses Bunsay before the RTC of Valenzuela City.
    • Notices sent to respondents were returned unserved with the notation “party moved.” No answer was filed by respondents.
    • At hearings, DPWH deposited Php 200,000 representing zonal value and replacement cost of improvements.
    • The RTC issued a Writ of Possession in favor of DPWH on February 20, 2012.
    • The RTC directed parties to submit nominees to the Board of Commissioners for determination of just compensation.
    • DPWH moved to deem the amount already received by Spouses Bunsay as just compensation.
    • The RTC granted expropriation, ordered transfer of the title, and awarded consequential damages equivalent to the capital gains tax (CGT) and other taxes necessary for the transfer of the property.
    • The RTC’s compensation award included:
      • Zonal value of the property.
      • Replacement cost of improvements: (i) one-storey semi-concrete house with fence/steel gate worth Php 330,604.35; (ii) one-storey concrete house with upper concrete slab worth Php 174,770.36.
    • DPWH filed a Motion for Partial Reconsideration (MPR) to delete the replacement cost of improvements and the consequential damages related to CGT and transfer taxes.
    • The RTC partially granted MPR, excluding replacement cost of improvements (since paid) but upheld the award of consequential damages for the value of CGT and other taxes, clarifying the damages are “consequential damages” and not taxes payable by DPWH.
  • Present Petition
    • DPWH filed a petition for review under Rule 45 challenging the award of consequential damages equivalent to the value of CGT and other transfer taxes.
    • Spouses Bunsay filed a comment arguing consequential damages should be broadly understood to cover damages caused by the expropriation.

Issues:

  • Whether the RTC erred in awarding consequential damages equivalent to the value of capital gains tax and other transfer taxes to Spouses Bunsay in the expropriation proceeding.

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

Doctrine:

  • (Subscriber-Only)

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