Case Summary (G.R. No. 172243)
Factual background relevant to the issue
The Republic, through the TRB, sought to acquire two parcels of land to widen the Balintawak Toll Plaza as part of North Luzon Expressway works. After filing and amending the complaint, the Republic deposited P2,311,200.00 (representing the total zonal value claimed) with the Land Bank of the Philippines and sought a writ of possession. Respondents asserted jurisdictional and other defenses; Sy Chi Siong filed an Answer (praying for just compensation), while Phil‑Ville did not file a responsive pleading but allegedly permitted entry and access for project works.
Trial court’s early determinations and actions
The trial court denied motions to dismiss and, in Orders of April 3 and June 18, 2002, asserted jurisdiction and directed issuance of a writ of possession and required answers. Later, upon petitioner’s motion for issuance of order of expropriation and appointment of commissioners, the trial court (Jan. 27, 2005) found the motion meritorious but deferred issuance of the order of expropriation pending final determination of just compensation; the court set a hearing to nominate commissioners to ascertain just compensation.
Petitioner’s contention before the trial court and the court’s March 7, 2005 ruling
Petitioner moved for partial reconsideration (Feb. 22, 2005), arguing that under Section 4, Rule 67 the court should issue the order of expropriation once the plaintiff’s right to expropriate is established and that issuance does not hinge upon prior determination or payment of just compensation. The trial court denied reconsideration (Mar. 7, 2005), construing Section 4 to require that just compensation be determined and paid before issuance of the order of expropriation.
Court of Appeals ruling and its reasoning
On certiorari, the Court of Appeals affirmed the trial court. The CA reiterated the two-stage view of condemnation proceedings (first, an order authorizing expropriation; second, determination of just compensation) but upheld the trial court’s deferral because, in that case, there was effectively no dispute as to the petitioner’s authority to expropriate and the project had moved forward. The CA characterized issuance of the order as discretionary and permissive; it found no grave abuse in deferring the order pending determination and payment of compensation and indicated that, in practice, payment completes vesting of title in the State.
Petitioner’s submissions to the Supreme Court
Petitioner presented two principal contentions on appeal: (I) an order of expropriation requires only a determination of authority to exercise eminent domain and should not depend on payment of just compensation; and (II) payment of just compensation is not a condition sine qua non for issuance of an order of expropriation.
Statutory framework under Rule 67 (Sections 4 and 5)
Section 4, Rule 67 provides that if objections and defenses to the plaintiff’s right to expropriate are overruled (or if no party appears to defend), the court may issue an order of expropriation declaring that the plaintiff has a lawful right to take the property for public use “upon the payment of just compensation to be determined as of the date of the taking or the filing of the complaint, whichever came first.” The second paragraph permits appeal from a final order sustaining the right to expropriate but specifies that such appeal does not prevent the court from determining just compensation. Section 5 provides that, upon rendition of the order of expropriation, the court shall appoint commissioners to ascertain and report on just compensation.
Supreme Court’s analytical approach to the statutory scheme
The Court recognized the two-stage nature of expropriation proceedings: (1) determination of the plaintiff’s authority to exercise eminent domain and the propriety of its exercise (culminating in an order of expropriation), and (2) ascertainment and payment of just compensation. The Court read Sections 4 and 5 together and construed the statutory text and scheme to mean that issuance of an order of expropriation is the natural end of the first stage and precedes appointment of commissioners and the ascertainment process. The Court emphasized that the order’s function is to terminate any ambiguity concerning the acquisition authority and to resolve objections to the exercise of eminent domain.
Holding on whether payment of just compensation is prerequisite to issuance of order
The Supreme Court held that issuance of an order of expropriation does not hinge on the prior payment of just compensation. An order of expropriation determines authority and propriety of condemnation; it may be issued once objections and
...continue readingCase Syllabus (G.R. No. 172243)
Nature of the Case and Controlling Legal Issue
- Petition for review to the Supreme Court from the Court of Appeals decision and resolution in CA-G.R. SP No. 89878.
- The lone legal issue: whether, under the facts of this case, a final determination of just compensation in expropriation proceedings must first be made before a court may issue an order of expropriation.
- The Court of Appeals answered the issue in the affirmative; the Republic, represented by the Toll Regulatory Board, sought annulment and setting aside of that CA decision and resolution.
Parties and Caption
- Petitioner: Republic of the Philippines, represented by the Toll Regulatory Board.
- Respondents/Defendants in the expropriation case: Phil-Ville Development and Housing Corporation (Phil-Ville) and Sy Chi Siong and Co., Inc. (Sy Chi Siong).
- Case citations given: 552 Phil. 821; THIRD DIVISION; G.R. NO. 172243; Decision dated June 26, 2007 (GARCIA, J.).
Factual Background
- Purpose: To ease traffic congestion on the North Luzon Expressway, the Republic, through the Toll Regulatory Board, sought to widen the Balintawak Toll Plaza.
- Two parcels of land registered to respondents were affected.
- Descriptive data provided in source for the two parcels:
- Phil-Ville
- TCT No./Lot No.: 243189 / 425
- Total Area (sq. m.): 425
- Assessed Value of Entire Area: P45,900.00
- Affected Area: 425
- Assessed Value of Affected Area: 45,900.00
- Zonal Value of the Affected Area: P1,062,500.00
- Sy Chi Siong
- TCT No./Lot No.: 29737 / 8,425
- Total Area (sq. m.): 8,425
- Assessed Value of Entire Area: P658,690.00
- Affected Area: 2,924
- Assessed Value of Affected Area: P228,606.47
- Zonal Value of the Affected Area: P7,310,000.00
- Phil-Ville
Commencement of Proceedings and Initial Procedural Steps
- On January 3, 2001, petitioner filed a complaint for expropriation in the Regional Trial Court of Caloocan City for acquisition of the described parcels.
- The case was raffled to Branch 131 of the RTC.
- Petitioner filed an Amended Complaint to reflect the proper schedule of valuation.
- Petitioner deposited with the Land Bank of the Philippines the amount of Two Million Three Hundred Eleven Thousand Two Hundred Pesos (P2,311,200.00), representing the total zonal value of the properties under expropriation.
- Petitioner filed a Motion for Issuance of Writ of Possession.
Respondents’ Motions and Trial Court’s Early Orders
- Both respondents separately moved to dismiss the complaint on the ground that the trial court lacked jurisdiction over the res.
- RTC Order dated April 3, 2002 denied both motions and asserted jurisdiction over the case.
- Respondents moved for reconsideration; the motions for reconsideration were denied by RTC Order dated June 18, 2002.
- In the June 18, 2002 Order, the court directed issuance of a writ of possession in favor of petitioner and required respondents to file answers to the complaint.
- Of the two defendants, only Sy Chi Siong filed an Answer, reiterating grounds from its earlier motion to dismiss and alternatively praying for just compensation.
- As to Phil-Ville, petitioner alleged Phil-Ville "has yet to file its responsive pleading to the complaint for expropriation."
Motion for Order of Expropriation and RTC’s January 27, 2005 Order
- Petitioner filed a Motion for Issuance of Order of Expropriation and Appointment of Commissioners, reasoning respondents had not challenged the right to expropriate.
- RTC Order dated January 27, 2005 found the motion meritorious but deferred action on the prayer for an order of expropriation.
- The RTC set the motion for hearing on March 7, 2005 "so that the parties may nominate the commissioners who will ascertain and report to the court the just compensation for the aforementioned properties."
- The RTC’s Order explicitly stated (as quoted): the "Motion for issuance of Order of Expropriation" is hereby deferred pending final determination of just compensation. (Emphasis supplied by the source.)
- The RTC’s Order included a discussion of eminent domain and described the expropriation as for public purpose to give way to construction, rehabilitation and expansion of the North Luzon Expressway.
Petitioner’s Motion for Partial Reconsideration and RTC’s March 7, 2005 Denial
- On February 22, 2005, petitioner filed a Motion for Partial Reconsideration of the January 27, 2005 Order.
- Petitioner argued that, because the case was set for hearing on March 7, 2005 for nomination of commissioners and determination of just compensation, "it is proper that an order of expropriation be forthwith issued before such determination of just compensation proceeds," citing Section 4, Rule 67 of the 1997 Rules of Civil Procedure and arguing that when a defendant raises solely the issue of just compensation the court "should forthwith enter an order of expropriation."
- RTC Order dated March 7, 2005 denied petitioner’s motion for partial reconsideration.
- The RTC’s denial stated (as quoted): "The provision of the rules relied upon, Section 4 Rule 67 is quite clear that this Court may issue an order of expropriation declaring that the plaintiff has a lawful right to take the property sought to be expropriated, for the public use or purpose described in the complaint, upon the payment of just compensation. Thus, just compensation of the subject properties must first be determined and paid before the Court can issue an order of expropriation." (Italics in original source.)
Appeal to the Court of Appeals (CA) — CA-G.R. SP No. 89878
- Dissatisfied with the RTC’s insistence on payment/determination of just compensation before issuing an order of expropriation, petitioner filed a petition for certiorari with the Court of Appeals (CA), docketed as CA-G.R. SP No. 89878, alleging grave abuse of discretion by the trial court.
- In its Decision dated January 27, 2006, the Court of Appeals upheld the trial court’s deferral of the order of expropriation pending determination of just compensation.
- CA reasoning included the following points (as quoted/summarized from the CA Decision):
- "Jurisprudential law has already settled that condemnation suits involve two stages: the order authorizing expropriation, and the judgment on just compensation."
- "An order of expropriation is a court's resolution upholding the State's lawful right to take property sought to be expropriated and thus forecloses any objection to the petitioner's authority to expropriate for the public purpose stated in the complaint."
- The CA noted that the order "can be issued unless there are objections and defenses against the condemnation proceedings that would require the presentation of evidence."
- Under the specific circumstances, the CA found there was no longer any issue as to petitioner’s authority to expropriate, respondents had acknowledged and admitted the authority, "the State has already been given the right to enter upon and to use the lots," and that "the project has already been completed."
- The CA conclude