Manila Banking Corporation v. Bases Conversion and Development Authority
REITERATIONFacts
The Antecedents: The Bases Conversion and Development Authority (BCDA) filed a complaint for expropriation against The Manila Banking Corporation (TMBC) to acquire a parcel of land for the Subic-Clark-Tarlac Expressway (SCTEX) Project. BCDA offered P75 per square meter, and deposited P5,590,650 based on the BIR zonal valuation of P30 per square meter. The trial court issued a writ of possession. TMBC contended that the offered price was below fair market value and that the project would diminish the property's value. The Bangko Sentral ng Pilipinas (BSP) was also involved due to a prior dacion en pago agreement with TMBC concerning the property. Procedural History: The Regional Trial Court (RTC) initially declared BCDA's right to expropriate and ordered parties to nominate commissioners. After several procedural steps, including setting aside one commissioner's report and appointing new ones, the RTC issued a Decision on September 4, 2012, ordering BCDA to pay TMBC P250 per square meter as just compensation. BCDA filed a motion for reconsideration, which TMBC argued was defective for lacking a notice of hearing. Despite this, the RTC issued an Order on August 28, 2014, reconsidering its previous decision and fixing just compensation at P190 per square meter. BCDA appealed to the Court of Appeals (CA). The Petition: The CA reversed the RTC's order and fixed just compensation at P75 per square meter, directing BCDA to pay the balance with specified interest rates. TMBC's motion for reconsideration was denied. TMBC filed a petition for review on certiorari, arguing that the RTC's decisions had legal and factual bases, that the CA erred in reversing the RTC, that the CA failed to rule on the finality of the RTC's September 4, 2012 decision, and that the CA erred in its computation of interest.
Issue(s)
Whether the BCDA's motion for reconsideration tolled the period to appeal. Whether the CA erred in reversing the RTC's determination of just compensation. Whether the CA erred in awarding just compensation at P75 per square meter instead of P250 or P190 per square meter. Whether the CA was correct in imposing interest rates of 12% per annum until June 30, 2013, and 6% per annum thereafter.
Ruling
The petition is denied. The Decision of the Court of Appeals dated October 26, 2016, and its Resolution dated February 22, 2017, are affirmed.
Ratio Decidendi
On the procedural issue of the motion for reconsideration: The Court held that while a motion for reconsideration without a notice of hearing is generally considered pro forma and does not toll the reglementary period for appeal, procedural rules may be relaxed to serve substantial justice. In this case, TMBC was afforded the opportunity to be heard by filing a comment/opposition, and the RTC further required the parties to submit judicial affidavits. Therefore, the requirements of procedural due process were substantially complied with, justifying a departure from the literal application of the rule on notice of hearing. On the determination of just compensation: The Court agreed with the CA that the RTC committed reversible error in its determination of just compensation. The CA correctly reviewed the commissioners' reports and the RTC's decisions. The RTC's initial valuation of P250 per square meter lacked explanation, and its subsequent valuation of P190 per square meter gave undue weight to certain documents while failing to consider other relevant data. The CA properly considered the standards set forth in Republic Act No. 8974, including the nature of the property as agricultural land, the zonal valuation, and the selling prices of contiguous and adjacent properties acquired for the same project, which ranged from P60 to P75 per square meter. The CA's fixing of just compensation at P75 per square meter was based on reliable and actual data at the time of taking. On the rate of just compensation: The CA properly considered the standards set forth in Republic Act No. 8974, including the nature of the property as agricultural land, the zonal valuation, and the selling prices of contiguous and adjacent properties acquired for the same project, which ranged from P60 to P75 per square meter. The CA's fixing of just compensation at P75 per square meter was based on reliable and actual data at the time of taking. On the rate of interest: The Court affirmed the CA's ruling on the interest rates. Citing Eastern Shipping Lines, Inc. v. Court of Appeals and BSP-MB Circular No. 799, Series of 2013, the Court reiterated that legal interest shall be 12% per annum from the time of taking until June 30, 2013, and 6% per annum from July 1, 2013, until full payment. This aligns with the established guidelines for computing legal interest on judgments, reflecting the period of forbearance of credit and subsequent changes in the prescribed legal rate.
Main Doctrine
The failure to include a notice of hearing in a motion for reconsideration is not fatal if the other party was afforded the opportunity to be heard and the court substantially complied with procedural due process. The determination of just compensation must be based on reliable and actual data at the time of taking, and appellate courts may review and fix the amount of just compensation based on such data.