G.R. No. 154411 - National Housing Authority vs. Heirs of Guivelondo

Case Summary (G.R. No. 154411)

Factual Background

The National Housing Authority sought to expropriate several lots in Banilad Estate and Cadastral Lot No. 1613-D at Carreta, Mabolo, Cebu City for a socialized housing project. The Heirs of Isidro Guivelondo were named defendants as owners of the latter parcel. The heirs manifested on November 12, 1999 that they waived objections to the Authority's power to expropriate, prompting the trial court to declare that petitioner had a lawful right to expropriate their properties and to appoint commissioners to determine just compensation.

Commissioners’ Report and Partial Judgment

The court-appointed commissioners reported on April 17, 2000, recommending just compensation at P11,200.00 per square meter for the subject lands. On August 7, 2000, the trial court rendered a Partial Judgment adopting that recommendation and ordered payment of just compensation at P11,200.00 per square meter for the listed lots of the Heirs of Isidro Guivelondo.

Motions for Reconsideration and Omnibus Order

The National Housing Authority filed motions for reconsideration contesting the inclusion of certain lots and the amount of compensation. The heirs likewise sought reconsideration. On October 11, 2000, the trial court issued an Omnibus Order that denied the heirs’ motion and one of petitioner’s motions but granted petitioner’s motion insofar as the Partial Judgment had fixed compensation for Lots Nos. 12, 13 and 19 without adequate basis; the court set aside those specific awards.

Entry of Judgment, Execution, and Early Appeals

The trial court entered judgment on October 31, 2000. The heirs obtained an order of execution on November 22, 2000. The National Housing Authority sought certiorari relief in the Court of Appeals (CA-G.R. SP No. 61746), which the Court of Appeals dismissed on January 31, 2001 on the ground that the Partial Judgment and Omnibus Order had become final and executory when petitioner failed to appeal. Petitioner’s subsequent motions for reconsideration with the Court of Appeals and a petition for review with this Court (G.R. No. 147527) were denied by the respective tribunals in 2001.

Motion to Dismiss and Further Procedural Steps

While appellate remedies were pending or had been resolved, petitioner filed a Motion to Dismiss the eminent domain case on July 16, 2001, alleging that the project became impracticable because the just compensation fixed was unconscionable and beyond the means of the intended beneficiaries. The trial court denied the Motion on September 17, 2001, and denied reconsideration on November 20, 2001. The National Housing Authority filed another certiorari petition in the Court of Appeals (CA-G.R. SP No. 68670), which initially was summarily dismissed but later reinstated; a temporary restraining order was issued enjoining the sheriff from enforcing the writ of execution while the CA considered the matter.

Levy, Garnishment and Court of Appeals Decision

Notwithstanding petitioner’s motions, respondent sheriff served notices of garnishment and levied on petitioner’s funds and personal properties, including a third garnishment notice to the Landbank of the Philippines on May 27, 2002. On July 16, 2002, the Court of Appeals dismissed the certiorari petition. Petitioner then filed the present petition for review with this Court.

Issues Presented to the Supreme Court

The National Housing Authority presented three primary issues: whether courts may compel the State to exercise or continue its power of eminent domain; whether the Partial Judgment had become final and executory and whether estoppel or laches could bind the government; and whether writs of execution and garnishment may be issued against the State in an expropriation where the taking would not serve public use or purpose, invoking Supreme Court Administrative Circular No. 10-2000.

Position of the Heirs of Isidro Guivelondo

The Heirs of Isidro Guivelondo argued that the trial court’s judgment had become final and executory and thus could not be disturbed; that petitioner’s funds and assets were not exempt from levy and garnishment; and that the issues raised by petitioner had already been resolved by prior rulings of the appellate courts.

Legal Analysis on Finality and Dismissal of Expropriation Proceedings

The Court reviewed the long-standing distinction that expropriation proceedings involve two stages: the determination of authority to expropriate and the fixing of just compensation. The Court relied on Rule 67, Section 4, 1997 Rules of Civil Procedure and precedent such as City of Manila v. Ruymann, Metropolitan Water District v. De Los Angeles, and City of Manila v. Serrano to explain that an order of condemnation or dismissal in the first stage is final and appealable, and that once the first order becomes final and unappealed, the authority to expropriate and the public use cannot be questioned thereafter. The Court held that the National Housing Authority did not appeal the order dated December 10, 1999 that declared its lawful right to expropriate the heirs’ properties; consequently that order became final and immune from collateral attack.

Rejection of Petitioner’s Argument that Public Use Was Extinguished by High Compensation

The Court rejected petitioner’s contention that the excessive amount of just compensation rendered the project impracticable and thus warranted dismissal. The Court affirmed that socialized housing constituted a valid public use, citing Sumulong v. Guerrero, and observed that petitioner had pursued appellate remedies attacking the compensation amount, which demonstrated continued assertion of public use until those remedies failed; petitioner could not initiate condemnation and later abandon the project simply because the court-fixed compensation proved higher than anticipated.

Legal Analysis on Garnishment and Character of Government Funds

On the question whether petitioner’s funds were exempt from levy and garnishment, the Co

Case Syllabus (G.R. No. 154411)

Parties and Procedural Posture

Petitioner National Housing Authority filed an amended complaint for eminent domain in the Regional Trial Court, Branch 11, Cebu City, docketed as Civil Case No. CEB-23386.
Respondents Heirs of Isidro Guivelondo were defendants in the eminent domain action and later pursued execution of the trial court judgment.
Respondent Court of Appeals adjudicated petitions for certiorari filed by petitioner challenging trial court orders denying dismissal and resisting execution.
Respondent Hon. Isaias Dicdican, Presiding Judge, Regional Trial Court, Branch 11, Cebu City entered the Partial Judgment and subsequent orders in the expropriation case.
Respondent Pascual Y. Abordo, Sheriff executed notices of levy and garnishment pursuant to the writ of execution issued by the trial court.

Key Factual Allegations

Petitioner alleged ownership claims of various private defendants and asserted that the subject lots were within a blighted urban center intended for a socialized housing project.
The Heirs of Isidro Guivelondo filed a manifestation waiving objections to expropriation, prompting the trial court to declare petitioner had a lawful right to expropriate.
Commissioners appointed by the trial court reported on April 17, 2000 recommending P11,200.00 per square meter as just compensation for respondents' lands.
The trial court rendered Partial Judgment on August 7, 2000 adopting the commissioners' recommendation and fixing just compensation at P11,200.00 per square meter.
Petitioner later asserted that implementation of its socialized housing project was rendered impossible because the fixed compensation was unconscionable and beyond the means of intended beneficiaries.

Procedural History

Petitioner filed motions for reconsideration of the Partial Judgment and challenged inclusion of certain lots, producing an Omnibus Order of October 11, 2000 that modified the Partial Judgment as to specific lots.
An Entry of Judgment was issued on October 31, 2000 and a Motion for Execution by respondents was granted on November 22, 2000.
The Court of Appeals dismissed petitioner's certiorari petition on January 31, 2001 on the ground that the Partial Judgment and Omnibus Order had become final and executory, and denied reconsideration on March 18, 2001.
Petitioner sought review in this Court in G.R. No. 147527 and the petition was denied on May 9, 2001, with subsequent denial of motion for reconsideration on August 20, 2001.
Petitioner moved to dismiss the expropriation in the trial court on July 16, 2001, and the motion was denied on September 17, 2001 and again on November 20, 2001 on reconsideration.
Petitioner filed another petition for certiorari with the Court of Appeals (CA-G.R. SP No. 68670) which was initially summarily dismissed, later reinstated, and ultimately the Court of Appeals dismissed the petition on July 16, 2002.
Respondent sheriff served notices of levy and garnishment beginning May 27, 2002 and levied on petitioner's funds and properties while a temporary restraining order briefly enjoined enforcement.

Issues Presented

Whether the State may be compelled or coerced by courts to exercise or continue the exercise of its inherent power of eminent domain.
Whether the judgment declaring the right to expropriate and the order fixing just compensation had become final and executory and whether estoppel or laches applies to the government.
Whether writs of execution and garnishment may be issued against the State or its instrumentalities in an expropriation where the exercise of eminent domain allegedly will not serve public use or purpose, including application of Supreme Court Administrat