Ansaldo v. Tantuico, Jr.
REITERATIONFacts
The Antecedents: Two lots of private ownership, with an aggregate area of 1,041 square meters, belonging to petitioners Jose Ma. Ansaldo and Maria Angela Ansaldo, were taken by the Government in 1947 for the widening of a road, without the benefit of an eminent domain action or agreement with the owners. The owners made no protest at the time of the taking. Procedural History: Twenty-six years later, on January 22, 1973, the owners requested compensation. The Secretary of Justice opined that just compensation should be paid based on Presidential Decree No. 76, which provided that the basis for compensation would be the current and fair market value as declared by the owner or determined by the assessor, whichever was lower. Pursuant to this, the Commissioner of Public Highways requested a redetermination of the market value. The Auditor of the Bureau of Public Highways recommended payment based on the current and fair market value, not the value at the time of taking. However, the Commission on Audit (COA), in a decision dated September 26, 1973, ruled that compensation should be determined as of the time of the taking (1947). This ruling was reiterated on September 8, 1978, and again on January 25, 1979, when the COA denied the owners' motion for reconsideration. These COA rulings are what the Ansaldos appealed. The Petition: The Ansaldos appealed the rulings of the Commission on Audit to the Supreme Court.
Issue(s)
Whether just compensation for expropriated property should be fixed as of the time of actual taking or as of the time of the filing of the expropriation suit. Whether the provisions of Presidential Decree No. 76 and its successor decrees on the determination of just compensation were constitutional.
Ruling
The petition is DENIED. The challenged decision of the Commission on Audit is AFFIRMED. The Department of Public Works and Highways is DIRECTED to forthwith institute the appropriate expropriation action over the land in question so that the just compensation due its owners may be determined in accordance with the Rules of Court, with interest at the legal rate of six percent (6%) per annum from the time of taking until full payment is made.
Ratio Decidendi
On the issue of when just compensation should be fixed: The Court held that in instances where the expropriating agency takes over the property prior to the expropriation suit, as in this case where possession was taken more than 40 years prior to the suit, just compensation shall be determined as of the time of actual taking, not as of the time of filing the action of eminent domain. The Court defined "taking" in the context of eminent domain as when the owner is actually deprived or dispossessed of his property, or when there is a practical destruction or material impairment of its value, or when the owner is deprived of its ordinary use. This occurs when the expropriator enters private property for a permanent duration, devoting it to public use in a manner that ousts the owner and deprives him of all beneficial enjoyment. The Court cited Republic v. Philippine National Bank and Republic v. Lara to support the principle that when possession is taken before the institution of condemnation proceedings, the value should be fixed as of the time of taking. The reason for this rule is to ensure that the owner is compensated only for what he actually loses, which is the actual value of his property at the time it is taken, and not for any subsequent increase in value or loss due to general economic conditions. Therefore, the value of the Ansaldos' property must be ascertained as of 1947, when it was actually taken. On the constitutionality of Presidential Decree No. 76: While not decisive of the present case, the Court noted that the provisions of Presidential Decree No. 76 and its related or successor decrees (Numbered 464, 794 and 1533) no longer determine the just compensation payable to owners of expropriated property. These provisions were struck down as unconstitutional and void in Export Processing Zone Authority v. Dulay. The Court reiterated that the mode prescribed therein for determining just compensation, based on the lower of the owner's declared value or the assessor's determined value, constituted an impermissible encroachment on the judicial prerogative to resolve the issue in an appropriate eminent domain proceeding.
Main Doctrine
In expropriation cases where the government takes possession of the property prior to the institution of the expropriation suit, just compensation shall be determined as of the time of actual taking, not as of the time of the filing of the action.