G.R. No.

162474

October 13, 2009

HON. VICENTE P. EUSEBIO, ORN! !. BERN!R"O, VICTOR EN"RIG!, #$% t&e CIT' O( P!SIG, Petitioners, vs. )OVITO *. UIS, I"INI ! UIS S!NTOS, !NGE IT! C!G! ING!N, RO*EO *. UIS, #$% VIRGINI! UIS+BE ESTEROS,* Respondents. DECISION PER! T!, J.: This resolves the Petition for Review on Certiorari under Rule 45 of the Rules of Court, pr !in" th t the De#ision$ of the Court of %ppe ls &C%' d ted Nove()er *+, *,,-, ffir(in" the tri l #ourt .ud"(ent, nd the C% Resolution* d ted /e)ru r! *0, *,,4, den!in" petitioners1 (otion for re#onsider tion, )e reversed nd set side. The nte#edent f #ts re s follows2 Respondents re the re"istered owners of p r#el of l nd #overed )! Tr nsfer Certifi# te of Title Nos. 5-53$ nd 5-5+3 with n re of $,5+4 s5u re (eters. S id p r#el of l nd w s t 6en )! the Cit! of P si" so(eti(e in $3+, nd used s (uni#ip l ro d now 6nown s %. S ndov l %venue, 7 r n" ! P l tiw, P si" Cit!. On /e)ru r! $, $33-, the S n""uni n of P si" Cit! p ssed Resolution No. $5 uthori8in" p !(ents to respondents for s id p r#el of l nd. 9owever, the %ppr is l Co((ittee of the Cit! of P si", in Resolution No. 3-:$- d ted O#to)er $3, $33-, ssessed the v lue of the l nd onl! tP$5,.,, per s5u re (eter. In letter d ted ;une *4, $335, respondents re5uested the %ppr is l Co((ittee to #onsiderP*,,,,.,, per s5u re (eter s the v lue of their l nd. One of the respondents lso wrote letter d ted Nove()er *5, $334 to < !or =i#ente P. Euse)io # llin" the l tter1s ttention to the f #t th t propert! in the s (e re , s the l nd su).e#t of this # se, h d )een p id for )! petitioners t the pri#e of P*,,,,.,, per s5u re (eter when s id propert! w s e>propri ted in the !e r $334 lso for #onversion into pu)li# ro d. Su)se5uentl!, respondents1 #ounsel sent de( nd letter d ted %u"ust *4, $334 to < !or Euse)io, de( ndin" the (ount of P5,,,,.,, per s5u re (eter, or tot l of P0,3-,,,,,.,,, s .ust #o(pens tion for respondents1 propert!. In response, < !or Euse)io wrote letter d ted Septe()er 3, $334 infor(in" respondents th t the Cit! of P si" # nnot p ! the( (ore th n the (ount set )! the %ppr is l Co((ittee. Thus, on O#to)er +, $334, respondents filed Co(pl int for Re#onve! n#e nd?or D ( "es &Civil C se No. 453-0' " inst herein petitioners )efore the Re"ion l Tri l Court &RTC' of P si" Cit!, 7r n#h $55. Respondents pr !ed th t the propert! )e returned to the( with p !(ent of re son )le rent l for si>teen !e rs of use t P5,,.,, per s5u re (eter, orP03-,,,,.,,, with le" l interest of $*@ per nnu( fro( d te of filin" of the #o(pl int until full p !(ent, or in the event th t s id propert! # n no lon"er )e returned, th t petitioners )e ordered to p ! .ust #o(pens tion in the (ount ofP0,3-,,,,,.,, nd rent l for si>teen !e rs of use t P5,,.,, per s5u re (eter, or P03-,,,,.,,, )oth with le" l interest of $*@ per nnu( fro( the d te of filin" of the #o(pl int until full p !(ent. In ddition, respondents pr !ed for p !(ent of (or l nd e>e(pl r! d ( "es, ttorne!1s fees nd #osts. %fter tri l, the RTC rendered follows2 De#ision- d ted ; nu r! *, *,,$, the dispositive portion of whi#h re ds s

A9ERE/ORE, in view of the fore"oin", .ud"(ent is here)! rendered in f vor of the pl intiffs nd " inst the defend nts2

$. De#l rin" s IBBEC%B nd DN;DST the #tion of the defend nts in t 6in" the properties of pl intiffs #overed )! Tr nsfer Certifi# tes of Title Nos. 5-53$ nd 5-5+3 without their #onsent nd without the )enefit of n e>propri tion pro#eedin"s re5uired )! l w in the t 6in" of priv te propert! for pu)li# useE *. Orderin" the defend nts to .ointl! RETDRN the su).e#t properties to pl intiffs with p !(ent of re son )le rent l for its use in the (ount of P03-,,,,.,, with le" l interest t the r te of 4@ per nnu( fro( the filin" of the inst nt Co(pl int until full p !(ent is ( deE -. In the event th t s id properties # n no lon"er )e returned to the pl intiffs s the s (e is lre d! )ein" used s pu)li# ro d 6nown s %. S ndov l %venue, P si" Cit!, the defend nts re here)! ordered to .ointl! p ! the pl intiffs the f ir nd re son )le v lue therefore t P5,,,,.,, per s5u re (eter or tot l of P0,3-,,,,,.,, with p !(ent of re son )le rent l for its use in the (ount of P5,,.,, per s5u re (eter or tot l of P03-,,,,.,,, )oth with le" l interest t the r te of 4@ per nnu( fro( the filin" of the inst nt Co(pl int until full p !(ent is ( deE nd 4. Orderin" the defend nts to .ointl! p ! the pl intiffs ttorne!1s fees in the (ount of P*,,,,,,.,,.
No pronoun#e(ent s to #osts. SO ORDERED. Petitioners then ppe led the # se to the C%, )ut the C% ffir(ed the RTC .ud"(ent in its De#ision d ted Nove()er *+, *,,-.
1avvphi1

Petitioners1 (otion for re#onsider tion of the C% De#ision w s denied per Resolution d ted /e)ru r! *0, *,,4. 9en#e, this petition where it is lle"ed th t2

I. PD7BIC RESPONDENT CODRT ERRED IN DP9OBDINC T9E RDBINC O/ T9E BOAER CODRT DESPITE T9E %PP%RENT B%CF O/ ;DRISDICTION 7G RE%SON O/ PRESCRIPTION O/ PRI=%TE RESPONDENTS1 CB%I< /OR ;DST CO<PENS%TIONE II. PD7BIC RESPONDENT CODRT ERRED IN /IHINC T9E /%IR %ND RE%SON%7BE CO<PENS%TION /OR RESPONDENTS1 PROPERTG %T P5,,,,.,, PER SID%RE <ETER DESPITE T9E CB%RINC /%CT T9%T %T T9E TI<E O/ T%FINC IN T9E GE%R $3+, T9E /%IR <%RFET =%BDE A%S PECCED 7G %N %PPR%IS%B CO<<ITTEE %T ONE 9DNDRED SIHTG PESOS &P9P$4,.,,'E III. PD7BIC RESPONDENT CODRT ERRED IN DP9OBDINC T9E ;DDC<ENT O/ T9E BOAER CODRT %A%RDINC T9E %<ODNT O/ P03-,,,,.,, %S RE%SON%7BE RENT%B /OR T9E DSE O/ RESPONDENTS1 PROPERTG IN SPITE O/ T9E /%CT T9%T T9E S%<E A%S CON=ERTED INTO % PD7BIC RO%D 7G % PRE=IODSBG EBECTED <DNICIP%B <%GOR AIT9ODT RESPONDENTS1 RECISTERINC %NG CO<PB%INT OR PROTEST /OR T9E T%FINC %ND DESPITE T9E /%CT T9%T SDC9 T%FINC DID NOT PERSON%BBG 7ENE/IT T9E PETITIONERS 7DT T9E PD7BIC %T B%RCEE %ND I=. PD7BIC RESPONDENT CODRT O/ %PPE%BS ERRED IN %//IR<INC T9E P*,,,,,,.,, %A%RD /OR %TTORNEG1S /EES TO T9E PRI=%TE RESPONDENTS1

CODNSEB DESPITE T9E %7SENCE O/ NECBICENCE OR IN%CTION ON T9E P%RT O/ PETITIONERS REB%TI=E TO T9E INST%NT CB%I< /OR ;DST CO<PENS%TION.4
%t the outset, petitioners (ust )e dis )used of their )elief th t respondents1 #tion for re#over! of their propert!, whi#h h d )een t 6en for pu)li# use, or to #l i( .ust #o(pens tion therefor is lre d! ) rred )! pres#ription. In Repu)li# of the Philippines v. Court of %ppe ls, 5 the Court e(ph si8ed Jth t where priv te propert! is t 6en )! the Covern(ent for pu)li# use without first #5uirin" title thereto either throu"h e>propri tion or ne"oti ted s le, the owner1s #tion to re#over the l nd or the v lue thereof does not pres#ri)e.J The Court went on to re(ind "overn(ent "en#ies not to e>er#ise the power of e(inent do( in with w nton disre" rd for propert! ri"hts s Se#tion 3, %rti#le III of the Constitution provides th t Jpriv te propert! sh ll not )e t 6en for pu)li# use without .ust #o(pens tion.J 4 The re( inin" issues here re whether respondents re entitled to re" in possession of their propert! t 6en )! the #it! "overn(ent in the $3+,1s nd, in the event th t s id propert! # n no lon"er )e returned, how should .ust #o(pens tion to respondents )e deter(ined. These issues h d )een s5u rel! ddressed in /orfo( Develop(ent Corpor tion v. Philippine N tion l R ilw !s,0 whi#h is #losel! n lo"ous to the present # se. In s id e rlier # se, the Philippine N tion l R ilw !s &PNR' too6 possession of the priv te propert! in $30* without "oin" throu"h e>propri tion pro#eedin"s. The S n Pedro:C r(on Co((uter Bine Pro.e#t w s then i(ple(ented with the inst ll tion of r ilro d f #ilities on sever l p r#els of l nd, in#ludin" th t of petitioner /orfo(. S id owner of the priv te propert! then ne"oti ted with PNR s to the (ount of .ust #o(pens tion. No "ree(ent h vin" )een re #hed, /orfo( filed #o(pl int for Re#over! of Possession of Re l Propert! nd?or D ( "es with the tri l #ourt so(eti(e in %u"ust $33,. In s id # se, the Court held th t )e# use the l ndowner did not #t to 5uestion the l #6 of e>propri tion pro#eedin"s for ver! lon" period of ti(e nd even ne"oti ted with the PNR s to how (u#h it should )e p id s .ust #o(pens tion, s id l ndowner is dee(ed to h ve w ived its ri"ht nd is estopped fro( 5uestionin" the power of the PNR to e>propri te or the pu)li# use for whi#h the power w s e>er#ised. It w s further de#l red therein th t2 > > > re#over! of possession of the propert! )! the l ndowner # n no lon"er )e llowed on the "rounds of estoppel nd, (ore i(port ntl!, of pu)li# poli#! whi#h i(poses upon the pu)li# utilit! the o)li" tion to #ontinue its servi#es to the pu)li#. The non:filin" of the # se for e>propri tion will not ne#ess ril! le d to the return of the propert! to the l ndowner. Ah t is left to the l ndowner is the ri"ht of #o(pens tion. > > > It is settled th t non:p !(ent of .ust #o(pens tion does not entitle the priv te l ndowners to re#over possession of their e>propri ted lot.+ ;ust li6e in the /orfo( # se, herein respondents lso f iled to 5uestion the t 6in" of their propert! for lon" period of ti(e &fro( $3+, until the e rl! $33,1s' nd, when s6ed durin" tri l wh t #tion the! too6 fter their propert! w s t 6en, witness ;ovito Buis, one of the respondents, testified th t Jwhen we h ve n o## sion to t l6 to < !or C run#ho we lw !s s6ed for #o(pens tion.J 3 It is li6ewise undisputed th t wh t w s #onstru#ted )! the #it! "overn(ent on respondents1 propert! w s ro d for pu)li# use, n (el!, %. S ndov l %venue in P si" Cit!. Cle rl!, s in /orfo(, herein respondents re lso estopped fro( re#overin" possession of their l nd, )ut re entitled to .ust #o(pens tion. Now, with re" rd to the tri l #ourt1s deter(in tion of the (ount of .ust #o(pens tion to whi#h respondents re entitled, the Court (ust stri6e down the s (e for )ein" #ontr r! to est )lished rules nd .urispruden#e. The prev ilin" do#trine on .udi#i l deter(in tion of .ust #o(pens tion is th t set forth in /orfo(. $, Therein, the Court ruled th t even if there re no e>propri tion pro#eedin"s instituted to deter(ine .ust #o(pens tion, the tri l #ourt is still ( nd ted to #t in ##ord n#e with the pro#edure provided for in

Se#tion 5, Rule 40 of the $330 Rules of Civil Pro#edure, re5uirin" the ppoint(ent of not (ore th n three #o(petent nd disinterested #o((issioners to s#ert in nd report to the #ourt the .ust #o(pens tion for the su).e#t propert!. The Court reiter ted its rulin" in N tion l Power Corpor tion v. Del Cru8 $$ th t Jtri l with the id of #o((issioners is su)st nti l ri"ht th t ( ! not )e done w ! with # pri#iousl! or for no re son t ll.J$* It w s lso e(ph si8ed therein th t lthou"h s#ert in(ent of .ust #o(pens tion is .udi#i l prero" tive, the #o((issioners1 findin"s ( ! onl! )e disre" rded or su)stituted with the tri l #ourt1s own esti( tion of the propert!1s v lue onl! if the #o((issioners h ve pplied ille" l prin#iples to the eviden#e su)(itted to the(, where the! h ve disre" rded #le r preponder n#e of eviden#e, or where the (ount llowed is either "rossl! in de5u te or e>#essive. Thus, the Court #on#luded in /orfo( th t2 The .ud"e should not h ve ( de deter(in tion of .ust #o(pens tion without first h vin" ppointed the re5uired #o((issioners who would initi ll! s#ert in nd report the .ust #o(pens tion for the propert! involved. This )ein" the # se, we find the v lu tion ( de )! the tri l #ourt to )e ineffe#tu l, not h vin" )een ( de in ##ord n#e with the pro#edure provided for )! the rules. $=eril!, the deter(in tion of .ust #o(pens tion for propert! t 6en for pu)li# use (ust )e done not onl! for the prote#tion of the l ndowners1 interest )ut lso for the "ood of the pu)li#. In Repu)li# v. Court of %ppe ls,$4 the Court e>pl ined s follows2 The #on#ept of .ust #o(pens tion, however, does not i(pl! f irness to the propert! owner lone. Co(pens tion (ust )e .ust not onl! to the propert! owner, )ut lso to the pu)li# whi#h ulti( tel! )e rs the #ost of e>propri tion.$5 It is 5uite #le r th t the Court, in for(ul tin" nd pro(ul" tin" the pro#edure provided for in Se#tions 5 nd 4, Rule 40, found this to )e the f irest w ! of rrivin" t the .ust #o(pens tion to )e p id for priv te propert! t 6en for pu)li# use. Aith re" rd to the ti(e s to when .ust #o(pens tion should )e fi>ed, it is settled .urispruden#e th t where propert! w s t 6en without the )enefit of e>propri tion pro#eedin"s, nd its owner files n #tion for re#over! of possession thereof )efore the #o((en#e(ent of e>propri tion pro#eedin"s, it is the v lue of the propert! t the ti(e of t 6in" th t is #ontrollin". $4 E>pl inin" the re son for this rule in < nil Intern tion l %irport %uthorit! v. Rodri"ue8,$0 the Court, 5uotin" %ns ldo v. T ntui#o, ;r.,$+ st ted, thus2 The re son for the rule, s pointed out in Republic v. Lara, is th t K . . . LwMhere propert! is t 6en he d of the filin" of the #onde(n tion pro#eedin"s, the v lue thereof ( ! )e en#h n#ed )! the pu)li# purpose for whi#h it is t 6enE the entr! )! the pl intiff upon the propert! ( ! h ve depre#i ted its v lue there)!E or, there ( ! h ve )een n tur l in#re se in the v lue of the propert! fro( the ti(e the #o(pl int is filed, due to "ener l e#ono(i# #onditions. The owner of priv te propert! should )e #o(pens ted onl! for wh t he #tu ll! losesE it is not intended th t his #o(pens tion sh ll e>tend )e!ond his loss or in.ur!. %nd wh t he loses is onl! the #tu l v lue of his propert! t the ti(e it is t 6en. This is the onl! w ! th t #o(pens tion to )e p id # n )e trul! .ustE i.e., N.ust not onl! to the individu l whose propert! is t 6en,O O)ut to the pu)li#, whi#h is to p ! for it.1 $3 In this # se, the tri l #ourt should h ve fi>ed .ust #o(pens tion for the propert! t its v lue s of the ti(e of t 6in" in $3+,, )ut there is nothin" on re#ord showin" the v lue of the propert! t th t ti(e. The tri l #ourt, therefore, #le rl! erred when it ) sed its v lu tion for the su).e#t l nd on the pri#e p id for properties in the s (e lo# tion, t 6en )! the #it! "overn(ent onl! so(eti(e in the !e r $334. 9owever, in t 6in" respondents1 propert! without the )enefit of e>propri tion pro#eedin"s nd without p !(ent of .ust #o(pens tion, the Cit! of P si" #le rl! #ted in utter disre" rd of respondents1 propriet r! ri"hts. Su#h #ondu#t # nnot )e #ounten n#ed )! the Court. /or s id ille" l t 6in", the Cit! of P si" should definitel! )e held li )le for d ( "es to respondents. %" in, in < nil Intern tion l %irport

%uthorit! v. Rodri"ue8,*, the Court held th t the "overn(ent "en#!1s ille" l o##up tion of the owner1s propert! for ver! lon" period of ti(e surel! resulted in pe#uni r! loss to the owner. The Court held s follows2 Su#h pe#uni r! loss entitles hi( to de5u te #o(pens tion in the for( of #tu l or #o(pens tor! d ( "es, whi#h in this # se should )e the le" l interest &4@' on the v lue of the l nd t the ti(e of t 6in", fro( s id point up to full p !(ent )! the <I%%. This is ) sed on the prin#iple th t interest Jruns s ( tter of l w nd follows fro( the ri"ht of the l ndowner to )e pl #ed in s "ood position s (one! # n ##o(plish, s of the d te of the t 6in".J The w rd of interest renders unw rr nted the "r nt of ) #6 rent ls s e>tended )! the #ourts )elow. In Republic v. Lara,et al., the Court ruled th t the inde(nit! for rent ls is in#onsistent with propert! owner1s ri"ht to )e p id le" l interest on the v lue of the propert!, for if the #onde(nor is to p ! the #o(pens tion due to the owners fro( the ti(e of the #tu l t 6in" of their propert!, the p !(ent of su#h #o(pens tion is dee(ed to retro #t to the #tu l t 6in" of the propert!E nd, hen#e, there is no ) sis for #l i(in" rent ls fro( the ti(e of #tu l t 6in".http2??$*0.,.,.$20+4,?sour#e?*,,4.8ip@-e$0e,dfP *,,4?/E7*,,4?$4$+-4.ht( : QftnRQftn <ore e>pli#itl!, the Court held in Republic v. Garcellano th t2 The unifor( rule of this Court, however, is th t this #o(pens tion (ust )e, not in the for( of rent ls, )ut )! w ! of Ointerest fro( the d te th t the #o(p n! Lor entit!M e>er#isin" the ri"ht of e(inent do( in t 6e possession of the #onde(ned l nds, nd the (ounts "r nted )! the #ourt sh ll #e se to e rn interest onl! fro( the (o(ent the! re p id to the owners or deposited in #ourt > > >. >>>> /or (ore th n twent! &*,' !e rs, the <I%% o##upied the su).e#t lot without the )enefit of e>propri tion pro#eedin"s nd without the <I%% e>ertin" efforts to s#ert in ownership of the lot nd ne"oti tin" with n! of the owners of the propert!. To our (ind, these re w nton nd irresponsi)le #ts whi#h should )e suppressed nd #orre#ted. 9en#e, the w rd of e>e(pl r! d ( "es nd ttorne!s fees is in order. 9owever, while Rodri"ue8 is entitled to su#h e>e(pl r! d ( "es nd ttorne!1s fees, the w rd "r nted )! the #ourts )elow should )e e5uit )l! redu#ed. Ae hold th t Rodri"ue8 is entitled onl! to P*,,,,,,.,, s e>e(pl r! d ( "es, nd ttorne!1s fees e5uiv lent to one per#ent &$@' of the (ount due. *$ B stl!, with re" rd to the li )ilit! of petitioners =i#ente P. Euse)io, Born %. 7ern rdo, nd =i#tor Endri" S ll offi#i ls of the #it! "overn(ent S the Court # nnot uphold the rulin" th t s id petitioners re .ointl! li )le in their person l # p #it! with the Cit! of P si" for p !(ents to )e ( de to respondents. There is de rth of eviden#e whi#h would show th t s id petitioners were lre d! #it! "overn(ent offi#i ls in $3+, or th t the! h d n! involve(ent wh tsoever in the ille" l t 6in" of respondents1 propert!. Thus, n! li )ilit! to respondents is the sole responsi)ilit! of the Cit! of P si". IN VIE, O( THE (OREGOING, the petition is P%RTI%BBG GR!NTE". The De#ision of the Court of %ppe ls d ted Nove()er *+, *,,- is <ODI/IED to re d s follows2

$. The v lu tion of .ust #o(pens tion nd w rd of ) #6 rent ls ( de )! the Re"ion l Tri l Court of P si" Cit!, 7r n#h $55 in Civil C se No. 453-0 re here)! SET %SIDE. The Cit! of P si", represented )! its dul!: uthori8ed offi#i ls, is DIRECTED to institute the ppropri te e>propri tion #tion over the su).e#t p r#el of l nd within fifteen &$5' d !s fro( fin lit! of this De#ision, for the proper deter(in tion of .ust #o(pens tion due to respondents, with interest t the le" l r te of si> &4@' per#ent per nnu( fro( the ti(e of t 6in" until full p !(ent is ( de. *. The Cit! of P si" is ORDERED to p ! respondents the (ounts of P*,,,,,,.,, s e>e(pl r! d ( "es ndP*,,,,,,.,, s ttorne!1s fees.

No #osts. SO OR"ERE".