Mactan-Cebu International Airport Authority v. Court of Appeals
REITERATIONFacts
The Antecedents: The Mactan-Cebu International Airport Authority (MCIAA) is the registered owner of Lot 941, acquired through expropriation proceedings initiated by the Republic of the Philippines in 1952 for the expansion of Lahug Airport. Virginia Chiongbian purchased Lot 941 in 1953 and was compensated in 1961 with ₱34,415.00, with legal interest from November 16, 1947. The title was transferred to the Republic and subsequently to MCIAA. Chiongbian alleged an assurance from the National Airport Corporation (NAC) that she would have the right to repurchase the lot for the same price if it was no longer used as an airport. Lahug Airport was closed in 1991, and its operations transferred to Mactan International Airport. Procedural History: Virginia Chiongbian filed a complaint for reconveyance of Lot 941, alleging a repurchase agreement. The Regional Trial Court (RTC) ruled in favor of Chiongbian, ordering MCIAA to restore possession and ownership upon reimbursement of the expropriation price. The Court of Appeals affirmed the RTC decision. MCIAA appealed to the Supreme Court. The Petition: MCIAA assails the Court of Appeals' decision, arguing that there was no repurchase agreement, that oral evidence was inadmissible under the Statute of Frauds, that the ruling in Limbaco was inapplicable, and that the modified judgment in a related case should not benefit Chiongbian.
Issue(s)
Whether the Court of Appeals erred in upholding the trial court's judgment that there was a repurchase agreement, despite MCIAA's protestations that oral evidence is not allowed under the Statute of Frauds. Whether the Court of Appeals erred in holding that the decision in Limbaco is material and applicable to the case at bar. Whether the Court of Appeals erred in holding that the modified judgment in CA-G.R. No. 33045 should inure to the benefit of Chiongbian even if she was not a party in said appealed case. Whether the Court of Appeals erred in ruling that the right of Virginia Chiongbian to repurchase should be under the same terms and conditions as the other landowners, specifically at ₱34,415.00.
Ruling
The Supreme Court reversed and set aside the decision of the Court of Appeals and dismissed the complaint of Virginia Chiongbian for reconveyance of Lot 941.
Ratio Decidendi
On the existence of a repurchase agreement and the admissibility of oral evidence: The Court held that the expropriation judgment in Civil Case No. R-1881 granted the Republic of the Philippines a fee simple title to Lot 941, unconditionally. The judgment did not contain any condition for reversion to the former owner or a right to repurchase. Chiongbian's claim of an oral assurance for repurchase was not supported by documentary evidence and was inadmissible under the Statute of Frauds, which requires agreements for the sale of real property to be in writing. MCIAA had consistently objected to the admission of oral evidence on this ground. The testimonies of Chiongbian and Bercede were also deemed hearsay as they lacked personal knowledge of the alleged assurance, having learned of it through others. The testimony of Attorney Pastrana regarding a deed of sale was also unconvincing, as it contradicted the expropriation proceedings and the fact that Chiongbian herself enforced the judgment by withdrawing the expropriation payment. On the applicability of the Limbaco case: The Court distinguished the present case from Mactan Cebu International Airport Authority vs. Court of Appeals (the Limbaco case), noting that Limbaco involved a contract of sale, not expropriation. In Limbaco, parol evidence was allowed to prove a repurchase agreement because the case involved a contract of sale and there was no objection to the presentation of such evidence. In the present case, the claim is based on an alleged assurance during expropriation proceedings, and the Statute of Frauds was invoked as an objection. On the benefit of the modified judgment in CA-G.R. No. 33045: The Court ruled that Chiongbian could not invoke the modified judgment in Republic of the Philippines vs. Escaño, et. al. (CA-G.R. No. 33045-R). Chiongbian did not appeal the original expropriation judgment and was not a party to the appeal of her co-defendants. Therefore, the modified judgment and the compromise agreements entered into by her co-defendants could not redound to her benefit, as a compromise is a contract binding only on the parties who signed it. On the terms of repurchase: Even assuming, arguendo, that Chiongbian had a right to repurchase, the Court found no basis for her claim to repurchase at the original expropriation price. The expropriation judgment granted a fee simple title, and there was no stipulation for repurchase at the original price. The Court also noted that allowing repurchase at the original price would be unfair given the property's increased value. The claim of a repurchase agreement was not substantiated by any written document, and the Statute of Frauds barred the admission of oral evidence to prove such an agreement.
Main Doctrine
When land is acquired for public use in fee simple, unconditionally, through expropriation, the former owner retains no rights in the land, and the public use may be abandoned or the land devoted to a different use without any reversion to the former owner. The Statute of Frauds applies to agreements for the sale of real property, requiring them to be in writing.