EMINENT DOMAIN (Section 9)

EMINENT DOMAIN (Section 9)

A.

Constitutional Provisions
Article III, Section 9
Section 9. Private property shall not be taken for public use without just compensation.

Article XII, Section 18 (public utilities)

Section 18. The State may, in the interest of national welfare or defense, establish and operate vital industries and, upon payment of just compensation, transfer to public ownership utilities and other private enterprises to be operated by the Government.

 Article XIII, section 4 (land reform) Section 4. The State shall, by law, undertake an agrarian reform program founded on the right of farmers and regular farmworkers who are landless, to own directly or collectively the lands they till or, in the case of other farmworkers, to receive a just share of the fruits thereof. To this end, the State shall encourage and undertake the just distribution of all agricultural lands, subject to such priorities and reasonable retention limits as the Congress may prescribe, taking into account ecological, developmental, or equity considerations, and subject to the payment of just compensation. In determining retention limits, the State shall respect the right of small landowners. The State shall further provide incentives for voluntary land-sharing.

 Article XVIII, Section 22 (idle or abandoned agricultural land)

Section 22. At the earliest possible time, the Government shall expropriate idle or abandoned agricultural lands as may be defined by law, for distribution to the beneficiaries of the agrarian reform program.

Definition
The right of eminent domain is usually understood to be the ultimate right of the sovereign power to appropriate, not only the public but the private property of all citizens within the territorial sovereignty, to public purpose A power inherent in sovereignty Need not be granted by any fundamental law

EMINENT DOMAIN (Section 9)

B. Elements
taking
Republic v. Vda de Castellvi Taking for the purpose of determining just compensation

for public use with just compensation

C. Elements of Taking
a. Expropriator must enter upon the private property e.g. By virtue of the lease agreement the Republic, through AFP, took possession of the property of Castellvi b. The entrance must be permanent
more than a momentary period Momentary: Lasting but a moment; lasting a very short time E.g. The Republic, through AFP, constructed some installations of a permanent nature does not alter the fact that it was transitory

EMINENT DOMAIN (Section 9)

c. The entry must be under warrant or color of legal authority - e.g. when the Republic entered the Castellvi property as lessee d. The property must be devoted to public use or otherwise informally appropriated or injuriously affected - e.g. Property was used by the air force of the AFP e. The utilization of the property must be in such a way as to oust the owner and deprive him of all beneficial enjoyment of the property - e.g. Entry of Republic into the property and its utilization for public use did not oust castellvi and deprive her of all beneficial enjoyment (Castelvi - 1974)

 Total taking? (Gutierrez, Causby - 1991) Writ of possession ministerial upon a) filing of complaint sufficient in form and substance; and b) deposit 15% of FMV per current tax declaration. Proof of public purpose not necessary (Francia- 2004)

EMINENT DOMAIN (Section 9)

D. Public Use
1. Definition use that is of utility, advantage, or productivity for the benefit of the public generally equivalent to public welfare in police power If expropriator ceases to use the land for a public purpose (e.g., sell the land to a private user), property reverts to the owner in fee simple (Heirs of Moreno 2005)

EMINENT DOMAIN (Section 9)

2.

Examples Socialized Housing (Sumulong - 1987)

Irrigation Systems (Coscolluela - 1988)

Tourism (Ardona - 1983)

Birthplace of Felix Manalo (Manosca 1996)

EMINENT DOMAIN (Section 9)

E.

Just Compensation 1. Definition a sum equivalent to its market value market value defined as the fair value of property as between one who desires but not compelled to purchase and one who desires but not compelled to sell payment must be made within a reasonable period of time from taking (Makati - 1990) for as long as the area to be retained is compact and contiguous and does not exceed the retention limit, land owners choice of area to be retained must prevail (Danan - 2005)

EMINENT DOMAIN (Section 9)

2. Entitlement
Those who have lawful interest in the property to be condemned, including a mortgagee, a lessee and a vendee in possession under an executory contract 3. Characteristics Value of property is fixed at the time of filing or taking? Whichever comes first (Esteban 2001) Compensation determined at time of institution of proceedings (Sarabia 2005)

EMINENT DOMAIN (Section 9)

Trial by commissioners is a substantive right which a judge may not dispense with (Meralco) Trial by commissioners not mandatory in agrarian reform cases (Lee 2008 Court may substitute value if: a) commissioners applied illegal principles to evidence submitted; b) they disregarded a clear preponderance of evidence; and c) where amount is grossly inadequate or excessive (NPC 2007) Entry may be made by expropriator prior to actual payment - deposit amount equivalent to the assessed value for taxation purposes (PD No. 42) - notice to the owner - no hearing required (Jocson - 1992)

EMINENT DOMAIN (Section 9)

Under RA 8974, the government must pay the preferred value (not just a deposit under Rule 67) before it can enter (Judge Gingoyon 2005) If there is delay in payment by government, 12% interest may be imposed (Wycoco 2004) Compensation may be in government bonds (Maddumba, Ramirez) If only a part of property taken, compensation is equal to market value plus consequential damages less consequential benefits (NPC 2003) Tax credit given to commercial establishments for a discount enjoyed by senior citizens pursuant to RA 7432 is a form of just compensation (BIR 2006) If government fails to pay within five years from finality of judgement, the owners shall have the right to recover possession (Lim 2005)

EMINENT DOMAIN (Section 9)

4. Judicial Review
1. Aspects subject to judicial review

adequacy of compensation necessity of taking (De Knecht1 - 1980) public use 2. Res judicata and expropriation cases may apply to specific issues decided in a previous case (Municipality of Paraaque 1998) the State may comply with issues raised and then exercise power of eminent domain (De Knecht2 - 1990)

EMINENT DOMAIN (Section 9)

3. Contracts and expropriation cases Expropriation not a proper substitute for enforcement of a valid contract (Noble - 1938) State cannot enter into contract not to exercise power of eminent domain 4. LGUs and expropriation a. Requisites ordinance authorizes local executive to exercise power power exercised for public use, purpose or welfare, or for the benefit of the poor and landless payment of just compensation offer has been previously made to owner but was not accepted (LGC, Section 19) (Jesus is Lord School 2005)

EMINENT DOMAIN (Section 9)

b. LGU cannot expropriate property on the strength of a resolution (Heirs of Suguitan - 2000) c. Limit on LGUs with respect to: 1) the order of priority in acquiring land for socialized housing and 2) resort to expropriation proceedings as a means of acquisition last resort (Estate of JBL Reyes 2004)
d. Expropriation proceedings may be resorted to only to only when other modes of acquisition have been exhausted (Lageco 2004)

Bardillon v. Barangau Masili

Issue of Jurisdiction over Expropriation
An expropriation suit is within the jurisdiction of the RTC regardless of the value of the land, because the subject of the action is the governments exercise of eminent domain a matter that is incapable of pecuniary estimation

Issue of Legality of Entry into Premises

Requisites for authorizing immediate entry
Complaint for expropriation sufficient in form and substance Deposit of the amount equivalent to 15 % of the fair market value of the property based on its current tax declaration

Issue of Necessity
RTC has the power to inquire into the legality of the exercise of the right of eminent domain and whether there is a genuine necessity for it

Estate of JBL v. City of Manila

Expropriation proceedings are to be resorted only after the other modes of acquisition have been exhausted The right of the State to expropriate private property as long as it is for public use takes precedence over the interest of private property owners Vigilance over compliance with the due process requirements is in order Complaint for expropriation was dismissed

NON-IMPAIRMENT OF CONTRACTS
(Section 10)

NON-IMPAIRMENT OF CONTRACTS
(Section 10)
A. Definition

To fall within the prohibition, the change must not only impair the obligation of the existing contract, but the impairment must be substantial. Moreover, the law must effect a change in the rights of the parties with reference to each other, and not with the respect to non-parties. (Philippine Cooperatives 2003)

NON-IMPAIRMENT OF CONTRACTS
(Section 10)
B. Characteristics

Non-impairment clause protects private and public contracts Franchises (City of San Pablo - 1999) and licenses (C&M Timber - 1997) are subject to modification by police power

C.

Specific Cases

Establishing or increasing an obligation to a third party does not change the relation of the parties (La Insular 1919)

NON-IMPAIRMENT OF CONTRACTS
(Section 10)
Mere change in procedural remedies but which leaves an efficacious remedy for enforcement does not impair the obligation of contracts (Rutter - 1953) But stricter rules on redemption applied retroactively violates the non-impairment clause (Co-1982)

NON-IMPAIRMENT OF CONTRACTS
(Section 10)
D. Non-Impairment Clause vs. Police Power Police power always wins except (New Agrix - 1990) Recent Cases: Contractual stipulations annotated on the title must yield to an ordinance (Ortigas 2000) Comelec can require candidates to pull out commercial endorsements notwithstanding contractual provisions (Chavez 2004) Timber licenses, permits and license agreements may be validly amended, modified, replaced or rescinded by the Chief Executive when national interest so requires. They are not contracts within the purview of the due process clause (Alvarez)

E.

FREE ACCESS TO COURTS

(Section 11)

FREE ACCESS TO COURTS

(Section 11)
Includes quasi-judicial bodies Includes adequate legal assistance It suffices that plaintiff is indigent

Motion to litigate as pauper litigant may be entertained by appellate court (Martinez 2000)

FREE ACCESS TO COURTS

(Section 11)