Export Processing Zone Authority v. Dulay
ABANDONMENTFacts
The Antecedents: The Export Processing Zone Authority (EPZA) issued Proclamation No. 1811 reserving a parcel of public land for an export processing zone. This proclamation included four parcels of land owned by San Antonio Development Corporation (SADC). EPZA offered to purchase these parcels based on the valuation in P.D. No. 464, but failed to reach an agreement with SADC. Procedural History: EPZA filed a complaint for expropriation. The respondent judge issued a writ of possession. At pre-trial, the parties agreed that the sole issue was just compensation. The respondent judge issued an order of condemnation and appointed commissioners to determine just compensation. The commissioners recommended P15.00 per square meter. EPZA moved for reconsideration, arguing that P.D. No. 1533 superseded Rule 67 of the Rules of Court and mandated that compensation be the lower of the owner's declared value or the assessor's determined value. The trial court denied the motion. The Petition: EPZA filed a petition for certiorari and mandamus, seeking to enjoin the trial court from enforcing its order and proceeding with the expropriation case, asserting that P.D. No. 1533 exclusively governs the determination of just compensation.
Issue(s)
Whether Presidential Decrees Nos. 76, 464, 794, and 1533 repealed or superseded Sections 5 to 8 of Rule 67 of the Revised Rules of Court regarding the determination of just compensation in expropriation cases, and the constitutionality of P.D. No. 1533 and its effect on Rule 67 of the Rules of Court. Whether P.D. No. 1533, by limiting the basis of just compensation to the lower of the owner's declared value or the assessor's determined value, violates due process and the nature of just compensation. Whether the trial court acted with grave abuse of discretion in denying EPZA's motion for reconsideration and in appointing commissioners, considering the abandonment of prior rulings and the role of the judiciary in determining just compensation.
Ruling
The petition is dismissed. The temporary restraining order is lifted and set aside. The provisions of P.D. No. 1533 limiting the determination of just compensation are declared unconstitutional and void.
Ratio Decidendi
On the constitutionality of P.D. No. 1533 and its effect on Rule 67 of the Rules of Court: The Court held that the method of ascertaining just compensation under P.D. Nos. 76, 464, 794, and 1533 constitutes an impermissible encroachment on judicial prerogatives. These decrees, by limiting the court's task to simply stating the lower value between the owner's declaration and the assessor's determination, effectively render the court inutile in a matter constitutionally reserved for its final determination. The appointment of commissioners under Rule 67 would become a mere formality, and the court would be stripped of its discretion to exercise independence in determining what is just and fair. The decrees, therefore, are unconstitutional and void. On the violation of due process and the nature of just compensation: The Court found that the strict application of the decrees would be violative of due process. It denies the owner the opportunity to prove that the valuation in tax documents is unfair or wrong. Allowing the haphazard work of a minor bureaucrat to absolutely prevail over the judgment of a court, after evidence and arguments have been presented and all factors considered, is repulsive to basic concepts of justice and fairness. The Court reiterated that just compensation means the fair and full equivalent for the loss sustained at the time of taking. It requires considering all facts as to the condition of the property, its surroundings, improvements, and capabilities. The valuation in tax declarations, while serving as a guide, cannot be an absolute substitute for just compensation, especially when they are outdated or do not reflect the true market value. On the abandonment of prior rulings and the role of the judiciary in determining just compensation: The Court acknowledged that in National Housing Authority v. Reyes, it had upheld P.D. No. 464. However, it stated that the members of the Court remained uncomfortable with the implications and potential for abuse. In the present case, the Court explicitly stated that the doctrine enunciated in National Housing Authority v. Reyes must necessarily be abandoned to uphold the Court's role as guardian of fundamental rights and final arbiter over transgressions against constitutional rights. The Court returned to older, sounder precedents. The Court concluded that the determination of "just compensation" in eminent domain cases is a judicial function. While the executive or legislature may make initial determinations, when a party claims a violation of the constitutional guarantee, no statute, decree, or executive order can mandate that its own determination shall prevail over the court's findings. The courts cannot be precluded from looking into the "just-ness" of the decreed compensation. Therefore, P.D. No. 1533, by eliminating the court's discretion to appoint commissioners, is unconstitutional and void.
Main Doctrine
Presidential Decrees limiting the determination of just compensation in expropriation cases to the lower of the owner's declared value or the assessor's determined value are unconstitutional and void as they constitute an impermissible encroachment on judicial prerogatives and violate the due process clause.