Republic v. Unson
REITERATIONFacts
The Antecedents: The Republic of the Philippines, through the Toll Regulatory Board (TRB), filed a complaint for expropriation to implement the South Luzon Tollway Extension Project (SLEP). The subject properties were Lot No. 6-B and Lot No. 4-C-2, owned by respondent C.C. Unson Company, Inc. (Unson). The TRB initially sought to expropriate the properties at P2,250.00 per square meter. Subsequently, the TRB amended its complaint, proposing a lower zonal value of P1,050.00 per square meter for Lot 4-C-2, based on certifications from revenue and assessment offices. Unson, in its answer, asserted that the properties were classified as residential and should have a higher value ranging from P5,000.00 to P10,000.00 per square meter. Procedural History: The Regional Trial Court (RTC), Branch 35, Calamba City, initially granted the TRB's motion for a writ of possession after the latter deposited P37,549,350.00. The RTC later ordered the TRB to make an additional deposit of P20,336,400.00, fixing the zonal value of Lot 4-C-2 at P2,250.00 per square meter, classifying it as residential. Unson received a total of P57,886,750.00. Unson also moved to include a remaining 750 sq.m. dangling lot in the expropriation proceedings. The RTC constituted a Board of Commissioners to determine just compensation. The Board considered factors such as location, highest and best use (industrial development), ocular inspection, valuation, BIR zonal valuation (industrial at P2,250.00/sq.m.), and market value. Commissioner Oscianas recommended P4,400.00/sq.m. and consequential damages for the dangling lots, while Commissioner Amata believed P2,250.00/sq.m. was sufficient. The RTC, in its Decision dated December 23, 2009, fixed just compensation at P3,500.00 per square meter, ordering the TRB to pay an additional P32,158,750.00. The Court of Appeals (CA) affirmed the RTC's decision in its March 21, 2014 Decision and denied the motion for reconsideration in its October 22, 2014 Resolution. The Petition: The Republic of the Philippines, through the TRB, filed a petition for review on certiorari, assailing the CA's affirmation of the RTC's determination of just compensation, arguing that the commissioners' report was flawed for considering the potential industrial use of the properties and that the RTC and CA erred in awarding compensation for the dangling lots.
Issue(s)
Whether the Court of Appeals erred in affirming the trial court's determination of just compensation. Whether the trial court and the Court of Appeals erred in considering the potential industrial use of the properties in determining just compensation. Whether the respondent is entitled to compensation for the remaining 750 sq.m. dangling lots.
Ruling
The petition is denied. The Court affirmed the decision of the Court of Appeals, which upheld the Regional Trial Court's determination of just compensation. The Republic of the Philippines, through the Toll Regulatory Board, is ordered to pay C.C. Unson Company, Inc. the amount of P32,158,750.00, representing the difference between the provisional payment received and the total just compensation of P90,044,500.00. Upon full payment, ownership and title to both the expropriated property and the dangling lots shall be transferred to the petitioner.
Ratio Decidendi
On the issue of affirming the trial court's determination of just compensation: The Supreme Court reiterated that the determination of just compensation is a judicial function, constitutionally mandated and vested in the courts. While legislative enactments and executive issuances can serve as guidelines, they are not binding on the courts and are treated as mere aids in ascertaining the amount of just compensation. The Court emphasized that it is not a trier of facts, and factual findings of the trial court, when affirmed by the Court of Appeals, are generally binding on the Supreme Court. In this case, both the RTC and CA had the opportunity to examine the facts and evidence presented, and their concurrent findings on the matter of just compensation were accorded great respect. The Court found no serious error or abuse of discretion on the part of the lower courts in fixing the amount of just compensation. On the issue of considering the potential industrial use of the properties: The Court clarified that the "highest and best use" of expropriated properties does not equate to mere "potential use." The RTC, in determining just compensation, did not solely rely on the potential use but considered all the factors set forth in Section 5 of Republic Act No. 8974, which provides standards for assessing the value of land. The use of the word "may" in the provision indicates that these standards are permissive and confer discretion upon the courts. The Court found no abuse of discretion in the RTC's consideration of these factors, including the industrial development potential, as part of its comprehensive evaluation. The commissioners' report, which was considered by the RTC, included an assessment of the highest and best use based on prevailing land usage and market conditions. On the issue of compensation for the 750 sq.m. dangling lots: The Court affirmed the entitlement of Unson to just compensation for the remaining 750 sq.m. dangling lots. Both the RTC and CA took cognizance of the expert opinion of Commissioner Oscianas that these lots, due to their irregular shape resulting from the expropriation, could no longer be utilized for any business purpose. The Court cited the general rule that when only a part of a property is expropriated, the owner is entitled to compensation for the portion taken and consequential damages to the remaining part. Section 6 of Rule 67 of the Rules of Court allows for the assessment of consequential damages and deduction of consequential benefits, but the owner shall not be deprived of the actual value of the property taken. The RTC, in fixing the P3,500.00 per sq.m. just compensation, had already factored in these consequential damages. To prevent unjust enrichment, the Court ruled that upon full payment of the just compensation, the ownership of these dangling lots should be transferred to the petitioner.
Main Doctrine
The determination of just compensation is a judicial function, and while legislative enactments and executive issuances may serve as guidelines, they are not binding on courts. Factual findings of the trial court, when affirmed by the Court of Appeals, are generally binding on the Supreme Court, absent any showing of grave abuse of discretion or reversible error.