PhilTread Workers Union (PTWU), et al. v. Secretary Nieves R. Confesor, et al. [G.R.
Facts
No. 117169]
March 12, 1997
Facts:
Petitioner PTWU filed a notice of strike on grounds of unfair labor practice, more specifically union
busting and violation of CBA. On the other hand, private respondent Philtread Tire and Rubber
Corporation filed a notice of lockout. It also filed a petition to declare illegal the work slowdowns
staged by the petitioner Union. Both cases were then consolidated. Several conciliation meetings
were conducted but the parties failed to settle their dispute.
At some time, the National Labor Relations Commission declared the slowdowns illegal.
Thereafter, private respondent corporation requested the Secretary of Labor to assume
jurisdiction over the labor dispute. Secretary Confesor then issued an order, which, among other
things, certified the dispute for compulsory arbitration. Petitioners filed a motion for reconsideration
of the order but the same was denied for lack of merit.
Petitioners questioned the constitutionality of Article 263 (g) of the Labor Code on the ground that
the Secretary of Labors intervention violates the workers constitutional right to strike, and alleged
that he acted with grave abuse of discretion in issuing the order since his power to certify a dispute
for compulsory arbitration is strictly restricted to cases involving industries that are indispensable
to national interest.
Issues:
1) Whether or not Article 263 (g) of the Labor Code is unconstitutional; and 2) Whether or not
public respondent acted with grave abuse of discretion in issuing the questioned order.
Ruling:
No.
Article 263 (g) of the Labor Code does not interfere with the workers right to strike but merely
regulates it, when in the exercise of such right, national interests will be affected. The rights
granted by the Constitution are not absolute. They are still subject to control and limitation to
ensure that they are not exercised arbitrarily. The interests of both the employers and employees
are intended to be protected and not one of them is given undue preference.
The assumption of the Secretary of Labor of jurisdiction is in the nature of police power measure.
This is done for the promotion of the common good considering that a prolonged strike or lockout
can be inimical to the national economy. The Secretary of Labor acts to maintain industrial peace.
As articulated in International Pharmaceuticals, Inc. vs. Secretary of Labor, it is fundamental that
a statute is to be read in a manner that would breathe life into it, rather than defeat it.
No.
Grave abuse of discretion implies capricious and whimsical exercise of judgment. The respondent
company is indispensable to national interest considering that the tire industry has already been
liberalized. Philtread supplies 22% of the tire products in the country. As observed by the Secretary
of Labor, the Company is one of the tire manufacturers in the country employing more or less 700
workers. Any work disruption thereat, as a result of a labor dispute will certainly prejudice the
employment and livelihood of its workers and their dependents. Furthermore, the labor dispute
may lead to the possible closure of the Company and loss of employment to hundreds of its
workers. This will definitely aggravate the already worsening unemployment situation in the
country and discourage foreign and domestic investors from further investing in the country.
Churchill & Tait v. Rafferty
32 Phil. 580 (1915)
In re: Police power of the State, Lawful Subject of police power
This is an appeal from a judgment of the Court of First Instance of Manila. The case involves a
dual question one involving the power of the court to restrain by injunction the collection of the tax
in question and the other relating to the power of the Collector of Internal Revenue to remove any
sign, signboard, or billboard upon the ground that the same is offensive to the sight or is otherwise
a nuisance.
The focus of this digest is to highlight the cases latter aspect as correlated to the police power of
the State.
Appellees, Francis A. Churchill and Stewart Tait are involved in the advertising business,
particularly in billboard advertising. Their billboards located upon private lands in the Province of
Rizal were removed upon complaints and by the orders of the defendant Collector of Internal
Revenue by virtue of the provisions of subsection (b) of section 100 of Act No. 2339.
Appellees, in their supplementary complaint challenge the power of the of the Collector of Internal
Revenue to remove any sign, signboard, or billboard upon the ground that the same is offensive
to the sight or is otherwise a nuisance and maintain that the billboards in question in no sense
constitute a nuisance and are not deleterious to the health, morals, or general welfare of the
community, or of any persons. Defendant Collector of Internal Revenue avers that after due
investigation made upon the complaints of the British and German Consuls, the defendant
decided that the billboard complained of was and still offensive to the sight and is otherwise a
nuisance.
Issue
1. Was the enactment assailed by the plaintiffs was a legitimate exercise
of the police power of the Government?
Held
The High Court is of the opinion that unsightly advertisements or signs, signboards, or billboards
which are offensive to the sight, are not disassociated from the general welfare of the public. This
is not establishing a new principle, but carrying a well- recognized principle to further application.
Moreover, if the police power may be exercised to encourage a healthy social and economic
condition in the country, and if the comfort and convenience of the people are included within
those subjects, everything which encroaches upon such territory is amenable to the police power.
Judgment reversed.
TAXICAB OPERATORS OF METRO MANILA VS. BOARD OF TRANSPORTATION
GR # L-59234, September 30, 1982 (Constitutional Law Police Power, Equal Protection)
FACTS: Petitioner assailed the constitutionality of an administrative regulation phasing out
taxicabs more than six years old on grounds that it is violative of the constitutional rights of equal
protection because it is only enforced in Manila and directed solely towards the taxi industry.
Respondents contend that the purpose of the regulation is the promotion of safety and comfort of
the riding public from the dangers posed by old and dilapidated taxis.
Petitioner Taxicab Operators of Metro Manila, Inc. (TOMMI) is a domestic corporation composed
of taxicab operators, who are grantees of Certificates of Public Convenience to operate taxicabs
within the City of Manila and to any other place in Luzon accessible to vehicular traffic.
On October 10, 1977, respondent Board of Transportation (BOT) issued Memorandum Circular
No. 77-42 which reads:
SUBJECT: Phasing out and Replacement of Old and Dilapidated Taxis
On January 27, 1981, petitioners filed a Petition with the BOT, docketed as Case No. 80-7553,
seeking to nullify MC No. 77-42 or to stop its implementation; to allow the registration and
operation in 1981 and subsequent years of taxicabs of model 1974, as well as those of earlier
models which were phased-out, provided that, at the time of registration, they are roadworthy and
fit for operation.
ISSUE: Whether or not an administrative regulation phasing out taxicabs more than six years old
is a valid exercise of police power.

HELD: No, the State in the exercise of its police power, can prescribe regulations to promote the
safety and general welfare of the people. In addition, there is no infringement of the equal
protection clause because it is common knowledge that taxicabs in Manila are subjected to heavier
traffic pressure and more constant use, creating a substantial distinction from taxicabs of other
places.
LOZANO v. MARTINEZ G.R No. L-63419. December 18, 1986 CONSTITUTIONAL LAW II
FUNDAMENTAL POWERS OF THE STATE
POLICE POWER
FLORENTINA A. LOZANO, petitioner, v. THE HONORABLE ANTONIO M. MARTINEZ, in his
capacity as Presiding Judge, Regional Trial Court, National Capital Region, Branch XX, Manila,
and HONORABLE JOSE B. FLAMINIANO, in his capacity as City Fiscal of Manila, respondents.
YAP, J.:
FACTS:
Petitioners, charged with Batas Pambansa Bilang 22 (BP 22 for short), popularly known as the
Bouncing Check Law, assail the law's constitutionality.
BP 22 punishes a person "who makes or draws and issues any check on account or for value,
knowing at the time of issue that he does not have sufficient funds in or credit with the drawee
bank for the payment of said check in full upon presentment, which check is subsequently
dishonored by the drawee bank for insufficiency of funds or credit or would have been dishonored
for the same reason had not the drawer, without any valid reason, ordered the bank to stop
payment." The penalty prescribed for the offense is imprisonment of not less than 30 days nor
more than one year or a fine or not less than the amount of the check nor more than double said
amount, but in no case to exceed P200,000.00, or both such fine and imprisonment at the
discretion of the court.
The statute likewise imposes the same penalty on "any person who, having sufficient funds in or
credit with the drawee bank when he makes or draws and issues a check, shall fail to keep
sufficient funds or to maintain a credit to cover the full amount of the check if presented within a
period of ninety (90) days from the date appearing thereon, for which reason it is dishonored by
the drawee bank.
An essential element of the offense is "knowledge" on the part of the maker or drawer of the check
of the insufficiency of his funds in or credit with the bank to cover the check upon its presentment.
Since this involves a state of mind difficult to establish, the statute itself creates a prima facie
presumption of such knowledge where payment of the check "is refused by the drawee because
of insufficient funds in or credit with such bank when presented within ninety (90) days from the
date of the check. To mitigate the harshness of the law in its application, the statute provides that
such presumption shall not arise if within five (5) banking days from receipt of the notice of
dishonor, the maker or drawer makes arrangements for payment of the check by the bank or pays
the holder the amount of the check.
Another provision of the statute, also in the nature of a rule of evidence, provides that the
introduction in evidence of the unpaid and dishonored check with the drawee bank's refusal to pay
"stamped or written thereon or attached thereto, giving the reason therefor, "shall constitute prima
facie proof of "the making or issuance of said check, and the due presentment to the drawee for
payment and the dishonor thereof ... for the reason written, stamped or attached by the drawee
on such dishonored check."
The presumptions being merely prima facie, it is open to the accused of course to present proof
to the contrary to overcome the said presumptions.
ISSUE:
Whether or not BP 22 or the Bouncing Check Law is unconstitutional.
RULING:
No, the enactment of the assailed statute is a valid exercise of Police power and is not repugnant
to the constitutional inhibition against imprisonment for debt. It may be constitutionally
impermissible for the legislature to penalize a person for non-payment of debt ex contractu, but
certainly it is within the prerogative of the lawmaking body to prescribe certain acts deemed
pernicious and inimical to public welfare. Acts mala in se are not only acts which the law can
punish. An act may not be considered by society as inherently wrong, hence, not malum in se, but
because of the harm that it inflicts on the community, it can be outlawed and criminally punished
as malum prohibitum. The state can do this in the exercise of its police power.
The enactment of the said statute is a declaration by the legislature that, as a matter of public
policy, the making and issuance of a worthless check is deemed a public nuisance to be abated
by the imposition of penal sanctions.
DEPARTMENT OF EDUCATION, CULTURE AND SPORTS (DECS) and DIRECTOR OF
CENTER FOR EDUCATIONAL MEASUREMENT vs. ROBERTO REY C. SAN DIEGO and
JUDGE TERESITA DIZON-CAPULONG, in her capacity as Presiding Judge of the RTC of
Valenzuela
G.R. No. 89572 December 21, 1989
Facts: Private respondent San Diego thrice flunked the National Medical Admission Test (NMAT).
Upon application again, herein petitioner rejected the application due to MECS Order No. 12,
Series of 1972 which contains the rule: A student shall be allowed only three (3) chances to take
the NMAT. After three (3) successive failures, a student shall not be allowed to take the NMAT for
the fourth time. Private respondent went to the RTC of Valenzuela, Metro Manila, to compel his
admission to the test. Respondent Judge granted the petition, and held that the petitioner had
been deprived of his right to pursue a medical education through an arbitrary exercise of the police
power.
Issue: Whether there was improper exercise of police power
Held: No.
In Tablarin v. Gutierrez, the Court upheld the constitutionality of the NMAT as a measure intended
to limit the admission to medical schools only to those who have initially proved their competence
and preparation for a medical education.
The court found no reason why the rationale in the Tablarin case cannot apply to the case at bar.
The issue raised in both cases is the academic preparation of the applicant. This may be gauged
at least initially by the admission test and, indeed with more reliability, by the three-flunk rule. The
latter cannot be regarded any less valid than the former in the regulation of the medical profession.
There is no need to redefine here the police power of the State. Suffice it to repeat that the power
is validly exercised if (a) the interests of the public generally, as distinguished from those of a
particular class, require the interference of the State, and (b) the means employed are reasonably
necessary to the attainment of the object sought to be accomplished and not unduly oppressive
upon individuals. In other words, the proper exercise of the police power requires the concurrence
of a lawful subject and a lawful method.
The subject of the challenged regulation is certainly within the ambit of the police power. It is the
right and indeed the responsibility of the State to insure that the medical profession is not infiltrated
by incompetents to whom patients may unwarily entrust their lives and health.
The method employed by the challenged regulation is not irrelevant to the purpose of the law nor
is it arbitrary or oppressive. The three-flunk rule is intended to insulate the medical schools and
ultimately the medical profession from the intrusion of those not qualified to be doctors.
The petition is granted. The decision of the respondent court dated January 13, 1989, is reversed.
Sangalang v. IAC (G.R. No. 71169. December 22, 1988)
FACTS:
The Mayor of Makati directed Bel-Air Village Association (BAVA) to opening of several streets to
the general public, after a series of developments in zoning regulations. All but Jupiter St. was
voluntarily opened. The strong opposition later gave way when the municipal officials force-
opened the gates of said street for public use. The area ceased to be purely residential. Action for
damages was brought against Ayala Corporation and BAVA for alleged breach of contract, to
maintain the purely residential status of the area. Other similarly situated also filed their respective
cases. All were dismissed in the trial court. The Court of Appeals affirmed the said dismissals.
ISSUE:
Whether or not there is a contract between homeowners and Ayala Corporation violated in
opening the Jupiter street for public use.
HELD:
No. There was no contract to speak of in the case, hence nothing was violated.
RATIO:
Petitioners cannot successfully rely on the alleged promise by Ayala Corporation, to build a
[f]ence along Jupiter [street] with gate for entrance and/or exit as evidence of Ayalas alleged
continuing obligation to maintain a wall between the residential and commercial sections.
Assuming there was a contract violated, it was still overtaken by the passage of zoning ordinances
which represent a legitimate exercise of police power. The petitioners have not shown why Courts
should hold otherwise other than for the supposed non-impairment guaranty of the Constitution,
which is secondary to the more compelling interests of general welfare. The Ordinance has not
been shown to be capricious or arbitrary or unreasonable to warrant the reversal of the judgments
so appealed.
Centeno v. Villalon-Pornillos G.R. No. 113092 September 1, 1994
KTA: Solicitation for religious purposes may be subject to proper regulation by the State in the
exercise of police power. The State has authority under the exercise of its police power to
determine whether or not there shall be restrictions on soliciting by unscrupulous persons or for
unworthy causes or for fraudulent purposes. Certainly the solicitation of contributions in good faith
for worthy purposes should not be denied, but somewhere should be lodged the power to
determine within reasonable limits the worthy from the unworthy.
Facts:
This petition is an appeal on the decision of the Trial Court convicting Centeno and Yco for violating
P.D. 1564 known as the Solicitation Permit Law when they both solicited money for the renovation
of their chapel without a permit from the DSWD.
In 1985, the petitioners, officers of Samahang Katandaan ng Nayon ng Tikay, launched a fund
drive for the renovation of their chapel in Bulacan.
The petitioners approached and solicited from Judge Adoracion G. Angeles, a resident of Tikay,
a contribution of P1,500.00. The solicitation was made without a permit from the Department of
Social Welfare and Development (DSWD). Hon. Angeles filed a complaint against the petitioners
for violation of P.D. 1564 known as the Soliciation Permit Law.
P.D. 1564 provides as follows:
Sec. 2. Any person, corporation, organization, or association desiring to solicit or receive
contributions for charitable or public welfare purposes shall first secure a permit from the Regional
Offices of the Department of Social Services and Development as provided in the Integrated
Reorganization Plan.
In 1992, the trial court found the petitioners guilty of violating the Solicitation Permit Law.
In this instant case, the petitioners assert among others that the term religious purpose is not
expressly included in the provisions of the statute, hence what the law does not include, it
excludes.
Issue: Whether or not the phrase charitable purposes should be construed in the broadest sense
so as to include a religious purpose.
Held/Ratio:
The 1987 Constitution and other statutes treat the words charitable and religious separately
and independently of each other.
In P.D. 1564, it merely stated charitable or public welfare purposes which means that it was not
the intention of the framers of the law to include solicitations for religious purposes. The world
religious purpose is not interchangeable with the expression charitable purpose.
The acts of the petitioners cannot be punished under the said law because the law does not
contemplate solicitation for religious purposes.
The solicitation for religious purposes may be subject to proper regulation by the State in the
exercise of police power. However, in the case at bar, considering that solicitations intended for a
religious purpose are not within the coverage of Presidential Decree No. 1564, as earlier
demonstrated, petitioner cannot be held criminally liable therefor.
The decision appealed from is reversed and set aside, and petitioner Martin Centeno is acquitted
of the offense charged.

Angeles University Foundation vs. City of Angeles
FACTS: Petitioner is a non-stock, non-profit educational foundation. It received a building permit
fee assessment for the construction of the AUF Medical Center but claimed exemption from the
same as well as from other permits and fees by virtue of Republic Act No. 6055. Respondent
disputed the claimed exemption by stating that the impositions are regulatory in nature and not
taxes from which petitioner is exempt under the said law.
ISSUE: Is the building permit fee a tax from which petitioner is exempt?
RULING: No. It is a regulatory fee. The DPWH has in fact issued implementing rules which provide
the bases for assessment of fees and petitioner has failed to show that they were arbitrarily
determined or unrelated to the activity being regulated. Neither has there been proof that the fee
was unreasonable or in excess of the cost of regulation or inspection. The Court added that even
if there was incidental revenue, the same is deemed not to change the nature of the charge. Thus,
the City of Angeles was justified in its assessment.
In distinguishing tax and regulation as a form of police power, the determining factor is the purpose
of the implemented measure. If the purpose is primarily to raise revenue, then it will be deemed a
tax even though the measure results in some form of regulation. On the other hand, if the purpose
is primarily to regulate, then it is deemed a regulation and an exercise of the police power of the
state, even though incidentally, revenue is generated. Thus, in Gerochi v. Department of Energy,
the Court stated:
"The conservative and pivotal distinction between these two (2) powers rests in the purpose for
which the charge is made. If generation of revenue is the primary purpose and regulation is merely
incidental, the imposition is a tax; but if regulation is the primary purpose, the fact that revenue is
incidentally raised does not make the imposition a tax."30 (Emphasis supplied.)
Amigable v Cuenca [43 SCRA 360; G.R. No. L-26400; 29 Feb. 1972]
Facts: Victoria Amigable is the registered owner of a particular lot. At the back of her Transfer
Certificate of Title (1924), there was no annotation in favor of the government of any right or
interest in the property. Without prior expropriation or negotiated sale, the government used a
portion of the lot for the construction of the Mango and Gorordo Avenues. On 1958, Amigables
counsel wrote the President of the Philippines, requesting payment of the portion of the said lot. It
was disallowed by the Auditor General in his 9th Endorsement. Petitioner then filed in the court a
quo a complaint against the Republic of the Philippines and Nicolas Cuenca, in his capacity as
Commissioner of Public Highways for the recovery of ownership and possession of the lot.
According to the defendants, the action was premature because it was not filed first at the Office
of the Auditor General. According to them, the right of action for the recovery of any amount had
already prescribed, that the Government had not given its consent to be sued, and that plaintiff
had no cause of action against the defendants.
Issue: Whether or Not, under the facts of the case, appellant may properly sue the government.
Held: In the case of Ministerio v. Court of First Instance of Cebu, it was held that when the
government takes away property from a private landowner for public use without going through
the legal process of expropriation or negotiated sale, the aggrieved party may properly maintain a
suit against the government without violating the doctrine of governmental immunity from suit
without its consent. In the case at bar, since no annotation in favour of the government appears
at the back of the certificate of title and plaintiff has not executed any deed of conveyance of any
portion of the lot to the government, then she remains the owner of the lot. She could then bring
an action to recover possession of the land anytime, because possession is one of the attributes
of ownership. However, since such action is not feasible at this time since the lot has been used
for other purposes, the only relief left is for the government to make due compensationprice or
value of the lot at the time of the taking.
Manosca vs. CA
Facts: Petitioners inherited a piece of land located at P. Burgos Street, Calzada, Taguig. Metro
Manila (492 square meters.) When the parcel of land was ascertained by the NHI to have been
the birthsite of Felix Y. Manalo, the founder of Iglesia Ni Cristo, it passed Resolution declaring the
land to be a national historical landmark. Which was approved.
So on on 29 May 1989, the Republic, through the Office of the Solicitor-General, instituted a
complaint for expropriation3 before the Regional Trial Court of Pasig.
Petitioners moved to dismiss the complaint on the main thesis that the intended expropriation was
not for a public purpose and, incidentally, that the act would constitute an application of public
funds, directly or indirectly, for the use, benefit, or support of Iglesia ni Cristo, a religious entity.
Hence this petition.
Issue: Whether or not the expropriation of the said parcel of land is for the purpose of public use
Held: Petition is DENIED.
The practical reality that greater benefit may be derived by members of the Iglesia ni Cristo than
by most others could well be true but such a peculiar advantage still remains to be merely
incidental and secondary in nature. Indeed, that only a few would actually benefit from the
expropriation of property does not necessarily diminish the essence and character of public use.
 and facilities of the PLDT. Private respondent contends that it cannot be compelled to enter into a
contract where no agreement is had between them.

ISSUE: Whether or not interconnection between PLDT and the Government Telephone System
can be a valid object for expropriation.

HELD: Yes, in the exercise of the sovereign power of eminent domain, the Republic may require
the telephone company to permit interconnection as the needs of the government service may
require, subject to the payment of just compensation. The use of lines and services to allow inter-
service connection between the both telephone systems, through expropriation can be a subject
to an easement of right of way.

REPUBLIC OF THE PHILIPPINES VS. PLDT, digested

Posted by Pius Morados on November 8, 2011

26 SCRA 620 (1969) (Constitutional Law Eminent Domain, Expropriation, Just Compensation)

FACTS: Public petitioner commenced a suit against private respondent praying for the right of the
Bureau of Telecommunications to demand interconnection between the Government Telephone
System and that of PLDT, so that the Government Telephone System could make use of the lines
EPZA VS. DULAY [148 SCRA 305;
G.R. No. L-59603; 29 Apr 1987]

Facts:
The four parcels of land which are the subject of this case is where the Mactan Export Processing
Zone Authority in Cebu (EPZA) is to be constructed. Private respondent San Antonio Development
Corporation (San Antonio, for brevity), in which these lands are registered under, claimed that the
lands were expropriated to the government without them reaching the agreement as to the
compensation. Respondent Judge Dulay then issued an order for the appointment of the
commissioners to determine the just compensation. It was later found out that the payment of the
government to San Antonio would be P15 per square meter, which was objected to by the latter
contending that under PD 1533, the basis of just compensation shall be fair and according to the
fair market value declared by the owner of the property sought to be expropriated, or by the
assessor, whichever is lower. Such objection and the subsequent Motion for Reconsideration were
denied and hearing was set for the reception of the commissioners report. EPZA then filed this
petition for certiorari and mandamus enjoining the respondent from further hearing the case.

Issue:
Whether or Not the exclusive and mandatory mode of determining just compensation in PD 1533
is unconstitutional.

Held:
The Supreme Court ruled that the mode of determination of just compensation in PD 1533 is
unconstitutional.
The method of ascertaining just compensation constitutes impermissible encroachment to judicial
prerogatives. It tends to render the courts inutile in a matter in which under the Constitution is
reserved to it for financial determination. The valuation in the decree may only serve as guiding
principle or one of the factors in determining just compensation, but it may not substitute the courts
own judgment as to what amount should be awarded and how to arrive at such amount. The
determination of just compensation is a judicial function. The executive department or the
legislature may make the initial determination but when a party claims a violation of the guarantee
in the Bill of Rights that the private party may not be taken for public use without just compensation,
no statute, decree, or executive order can mandate that its own determination shall prevail over
the courts findings. Much less can the courts be precluded from looking into the justness of the
decreed compensation.
REPUBLIC vs. CA
G.R. No. 146587 July 2, 2002
FACTS:
Petitioner (PIA) instituted expropriation proceedings covering a total of 544,980 square meters of
contiguous land situated along MacArthur Highway, Malolos, Bulacan, to be utilized for the
continued broadcast operation and use of radio transmitter facilities for the Voice of the
Philippines project.
Petitioner made a deposit of P517,558.80, the sum provisionally fixed as being the reasonable
value of the property. On 26 February 1979, or more than 9 years after the institution of the
expropriation proceedings, the trial court issued this order condemning the property and ordering
the plaintiff to pay the defendants the just compensation for the property.
It would appear that the National Government failed to pay the respondents the just compensation
pursuant to the foregoing decision. The respondents then filed a manifestation with a motion
seeking payment for the expropriated property. In response, the court issued a writ of execution
for the implementation thereof.
Meanwhile, Pres. Estrada issued Proc. No. 22 transferring 20 hectares of the expropriated land to
the Bulacan State University.
Despite the courts order, the Santos heirs remained unpaid and no action was on their case until
petitioner filed its manifestation and motion to permit the deposit in court of the amount P4,664,000
by way of just compensation.
The Santos heirs submitted a counter-motion to adjust the compensation from P6/sq.m. as
previously fixed to its current zonal value of P5,000/sq.m. or to cause the return of the expropriated
property.
The RTC Bulacan ruled in favor of the Santos heirs declaring its 26 February 1979 Decision to be
unenforceable on the ground of prescription in accordance with Sec. 6, Rule 39 of the 1964/1997
ROC which states that a final and executory judgment or order may be executed on motion within
5 years from the date of its entry. RTC denied petitioners Motion to Permit Deposit and ordered
the return of the expropriated property to the heirs of Santos.
ISSUES:
1. WON the petitioner may appropriate the property
2. WON the respondents are entitled to the return of the property in question
HELD:
1. The right of eminent domain is usually understood to be an ultimate right of the sovereign
power to appropriate any property within its territorial sovereignty for a public purpose.
Fundamental to the independent existence of a State, it requires no recognition by the
Constitution, whose provisions are taken as being merely confirmatory of its presence and as
being regulatory, at most, in the due exercise of the power. In the hands of the legislature, the
power is inherent, its scope matching that of taxation, even that of police power itself, in many
respects. It reaches to every form of property the State needs for public use and, as an old case
so puts it, all separate interests of individuals in property are held under a tacit agreement or
implied reservation vesting upon the sovereign the right to resume the possession of the property
whenever the public interest so requires it.
The ubiquitous character of eminent domain is manifest in the nature of the expropriation
proceedings. Expropriation proceedings are not adversarial in the conventional sense, for the
condemning authority is not required to assert any conflicting interest in the property. Thus, by
filing the action, the condemnor in effect merely serves notice that it is taking title and possession
of the property, and the defendant asserts title or interest in the property, not to prove a right to
possession, but to prove a right to compensation for the taking.
Obviously, however, the power is not without its limits: first, the taking must be for public use, and
second, that just compensation must be given to the private owner of the property. These twin
proscriptions have their origin in the recognition of the necessity for achieving balance between
the State interests, on the one hand, and private rights, upon the other hand, by effectively
restraining the former and affording protection to the latter. In determining public use, two
approaches are utilized - the first is public employment or the actual use by the public, and the
second is public advantage or benefit. It is also useful to view the matter as being subject to
constant growth, which is to say that as society advances, its demands upon the individual so
increases, and each demand is a new use to which the resources of the individual may be devoted.
The expropriated property has been shown to be for the continued utilization by the PIA, a
significant portion thereof being ceded for the expansion of the facilities of the Bulacan State
University and for the propagation of the Philippine carabao, themselves in line with the
requirements of public purpose. Respondents question the public nature of the utilization by
petitioner of the condemned property, pointing out that its present use differs from the purpose
originally contemplated in the 1969 expropriation proceedings. The argument is of no moment.
The property has assumed a public character upon its expropriation. Surely, petitioner, as the
condemnor and as the owner of the property, is well within its rights to alter and decide the use of
that property, the only limitation being that it be for public use, which, decidedly, it is.
2. NO. In insisting on the return of the expropriated property, respondents would exhort on the
pronouncement in Provincial Government of Sorsogon vs. Vda. de Villaroya where the unpaid
landowners were allowed the alternative remedy of recovery of the property there in question. It
might be borne in mind that the case involved the municipal government of Sorsogon, to which
the power of eminent domain is not inherent, but merely delegated and of limited application. The
grant of the power of eminent domain to local governments under Republic Act No. 7160 cannot
be understood as being the pervasive and all-encompassing power vested in the legislative branch
of government. For local governments to be able to wield the power, it must, by enabling law, be
delegated to it by the national legislature, but even then, this delegated power of eminent domain
is not, strictly speaking, a power of eminent, but only of inferior, domain or only as broad or
confined as the real authority would want it to be.
Thus, in Valdehueza vs. Republic where the private landowners had remained unpaid ten years
after the termination of the expropriation proceedings, this Court ruled -
The points in dispute are whether such payment can still be made and, if so, in what amount.
Said lots have been the subject of expropriation proceedings. By final and executory judgment in
said proceedings, they were condemned for public use, as part of an airport, and ordered sold to
the government. x x x It follows that both by virtue of the judgment, long final, in the expropriation
suit, as well as the annotations upon their title certificates, plaintiffs are not entitled to recover
possession of their expropriated lots - which are still devoted to the public use for which they were
expropriated - but only to demand the fair market value of the same.
"Said relief may be granted under plaintiffs' prayer for: `such other remedies, which may be
deemed just and equitable under the premises'."
The Court proceeded to reiterate its pronouncement in Alfonso vs. Pasay City where the recovery
of possession of property taken for public use prayed for by the unpaid landowner was denied
even while no requisite expropriation proceedings were first instituted. The landowner was merely
given the relief of recovering compensation for his property computed at its market value at the
time it was taken and appropriated by the State.
The judgment rendered by the Bulacan RTC in 1979 on the expropriation proceedings provides
not only for the payment of just compensation to herein respondents but likewise adjudges the
property condemned in favor of petitioner over which parties, as well as their privies, are bound.
Petitioner has occupied, utilized and, for all intents and purposes, exercised dominion over the
property pursuant to the judgment. The exercise of such rights vested to it as the condemnee
indeed has amounted to at least a partial compliance or satisfaction of the 1979 judgment, thereby
preempting any claim of bar by prescription on grounds of non-execution. In arguing for the return
of their property on the basis of non-payment, respondents ignore the fact that the right of the
expropriatory authority is far from that of an unpaid seller in ordinary sales, to which the remedy
of rescission might perhaps apply. An in rem proceeding, condemnation acts upon the property.
After condemnation, the paramount title is in the public under a new and independent title; thus,
by giving notice to all claimants to a disputed title, condemnation proceedings provide a judicial
process for securing better title against all the world than may be obtained by voluntary
conveyance.
Respondents, in arguing laches against petitioner did not take into account that the same
argument could likewise apply against them. Respondents first instituted proceedings for payment
against petitioner on 09 May 1984, or five years after the 1979 judgment had become final. The
unusually long delay in bringing the action to compel payment against herein petitioner would
militate against them. Consistently with the rule that one should take good care of his own concern,
respondents should have commenced the proper action upon the finality of the judgment which,
indeed, resulted in a permanent deprivation of their ownership and possession of the property.

The constitutional limitation of just compensation is considered to be the sum equivalent to the
market value of the property, broadly described to be the price fixed by the seller in open market
in the usual and ordinary course of legal action and competition or the fair value of the property
as between one who receives, and one who desires to sell, it fixed at the time of the actual taking
by the government. Thus, if property is taken for public use before compensation is deposited with
the court having jurisdiction over the case, the final compensation must include interests on its
just value to be computed from the time the property is taken to the time when compensation is
actually paid or deposited with the court. In fine, between the taking of the property and the actual
payment, legal interests accrue in order to place the owner in a position as good as (but not better
than) the position he was in before the taking occurred.

The Bulacan trial court, in its 1979 decision, was correct in imposing interests on the zonal value
of the property to be computed from the time petitioner instituted condemnation proceedings and
took the property in September 1969. This allowance of interest on the amount found to be the
value of the property as of the time of the taking computed, being an effective forbearance, at 12%
per annum should help eliminate the issue of the constant fluctuation and inflation of the value of
the currency over time. Article 1250 of the Civil Code, providing that, in case of extraordinary
inflation or deflation, the value of the currency at the time of the establishment of the obligation
shall be the basis for the payment when no agreement to the contrary is stipulated, has strict
application only to contractual obligations. In other words, a contractual agreement is needed for
the effects of extraordinary inflation to be taken into account to alter the value of the currency.

All given, the trial court of Bulacan in issuing its order, dated 01 March 2000, vacating its decision
of 26 February 1979 has acted beyond its lawful cognizance, the only authority left to it being to
order its execution. Verily, private respondents, although not entitled to the return of the
expropriated property, deserve to be paid promptly on the yet unpaid award of just compensation
already fixed by final judgment of the Bulacan RTC on 26 February 1979 at P6.00 per square
meter, with legal interest thereon at 12% per annum computed from the date of "taking" of the
property, i.e., 19 September 1969, until the due amount shall have been fully paid.