MUNICIPALITY OF DELFIN ALBANO, ISABELA, REPRESENTED BY MUNICIPAL MAYOR TOMAS J. PUA, JR., PLAINTIFF-APPELLEE, VS. NORMAN L. TAGUFA, DEFENDANT-APPELLANT.

Municipality of Delfin Albano versus Tagufa

The Case

This is an ordinary appeal in an expropriation case. The Municipality of Delfin Albano, Isabela, represented by its Municipal Mayor, Tomas J. Pua, Jr., filed a complaint to condemn a portion of the land of Norman L. Tagufa for the construction of a Liga ng mga Barangay Multi-Purpose Hall, a Day Care Center, and a Senior Citizens and RIC Building. Tagufa resisted, and the dispute narrowed to a single question: how much just compensation is owed. The case matters because it teaches the two phases of expropriation, the standard for fixing just compensation, the sufficiency of due process in commissioner proceedings, and when the abandonment of a public purpose may be raised.

Procedural History

The Municipality filed its complaint for expropriation before the Regional Trial Court of Cabagan, Isabela, Branch 22. At pre-trial, the trial court declared that the only issue was the price to be paid for the lot. The trial court then issued an Order of Expropriation and directed the parties to submit nominees for a panel of commissioners. Three panels of commissioners were constituted in succession, each submitting a report on just compensation. The trial court ultimately approved the final report and rendered a Decision ordering the Municipality to pay 72,960 pesos as just compensation. Tagufa's motion for reconsideration was denied, and he elevated the matter to the Supreme Court by ordinary appeal.

Facts

On the fourth of October, 2000, the Municipality filed a complaint for expropriation seeking to take 456 square meters out of Tagufa's 1,200 square meter land. It invoked a municipal council resolution stating that the property was needed for infrastructure development, particularly the construction of a Liga ng mga Barangay Multi-Purpose Hall, a Day Care Center, and a Senior Citizens and RIC Building. The Municipality claimed it had offered to buy the property at fair market value, but Tagufa refused to sell.

In his answer, Tagufa did not deny the resolution, but he alleged that the Municipality had failed to include another 400 square meters that it had already taken and developed as a road. He also insisted that other vacant areas in the municipal compound could accommodate the planned buildings. The trial court fixed the only issue as the price and issued an Order of Expropriation.

Over the years, three panels of commissioners submitted reports. The first recommended 600 pesos per square meter. The second recommended 90 pesos per square meter. The third and final panel recommended 100 pesos per square meter, or a total of 45,600 pesos. The Municipality did not object to the final report, but Tagufa did, claiming lack of notice of the hearing and that the property should have been classified as commercial. Before judgment, Tagufa moved to dismiss, arguing that the Municipality had instead planted mahogany trees on the property and had abandoned the public purpose. The trial court denied the motion and rendered its Decision, awarding 45,600 pesos as the value of the land plus 27,300 pesos in legal interest, for a total of 72,960 pesos.

Issues

• Whether or not the trial court committed reversible error in approving the commissioners' report without a hearing.
• Whether or not the trial court committed reversible error in not dismissing the complaint for expropriation.
• Whether or not Tagufa is entitled to moral damages.

Applicable Provisions

Section 10, Rule 67 of the Rules of Court provides:

Section 10. Rights of plaintiff after judgment and payment. Upon payment by the plaintiff to the defendant of the compensation fixed by the judgment, with legal interest thereon from the taking of the possession of the property, or after tender to him of the amount so fixed and payment of the costs, the plaintiff shall have the right to enter upon the property expropriated and to appropriate it for the public use or purpose defined in the judgment, or to retain it should he have taken immediate possession thereof under the provisions of section 2 hereof.

This provision shows that the Municipality cannot yet enter and build until judgment and payment, so the public purpose has not been abandoned.

Section 13, Rule 67 of the Rules of Court provides:

Section 13. Recording judgment, and its effect. The judgment entered in expropriation proceedings shall state definitely, by an adequate description, the particular property or interest therein expropriated, and the nature of the public use or purpose for which it is expropriated. When real estate is expropriated, a certified true copy of such judgment shall be recorded in the registry of deeds of the place in which the property is situated, and its effect shall be to vest in the plaintiff the title to the real estate so described for such public use or purpose.

This provision confirms that title vests in the Municipality only upon judgment, which is why construction could not have commenced earlier.

Ruling

On the first issue, the Court held that there was no denial of due process. The essence of due process is simply an opportunity to be heard, an opportunity to explain one's side, or an opportunity to seek reconsideration. A formal or trial-type hearing is not at all times essential. Tagufa was notified, filed objections, and moved for reconsideration several times, and the trial court even reconstituted the panel of commissioners twice at his instance. Any seeming defect was cured by these opportunities.

On the second issue, the Court held that dismissal was premature. The first phase of expropriation, the authority to take and the public purpose, was settled by the final Order of Expropriation, which no party appealed. As to abandonment, the Court quoted the Rules:

Section 10. Rights of plaintiff after judgment and payment. Upon payment by the plaintiff to the defendant of the compensation fixed by the judgment, with legal interest thereon from the taking of the possession of the property, or after tender to him of the amount so fixed and payment of the costs, the plaintiff shall have the right to enter upon the property expropriated and to appropriate it for the public use or purpose defined in the judgment, or to retain it should he have taken immediate possession thereof under the provisions of section 2 hereof.

Since judgment and payment are required before the Municipality may enter and build, Tagufa failed to show that the public purpose was abandoned.

On the third issue, the Court held that damages require a breach of duty that is the proximate cause of an injury in the contemplation of law. Tagufa failed to establish such injury, so he is not entitled to moral or exemplary damages or attorney's fees.

On just compensation, the Court held that the value of the land at the time of taking is the criterion. Since the Municipality took the property before filing the complaint, the basis is its value sometime before October 2000. The trial court's computation, adding legal interest at six percent per annum for eleven years, was sustained.

Doctrine

Expropriation has two phases: first, the determination of the authority to exercise eminent domain and the propriety of its exercise, which ends in an order of condemnation or dismissal; second, the determination of just compensation, with the assistance of not more than three commissioners. The order fixing just compensation is final as to the second stage.

Just compensation is measured by the value of the land and its character at the time of taking, not its value after the passage of time, subject to legal interest from the taking.

Due process in commissioner proceedings requires only a fair and reasonable opportunity to be heard; a formal trial-type hearing is not always essential, and any seeming defect is cured by motions for reconsideration.

Abandonment of the public purpose cannot be raised before judgment and payment, because under Sections 10 and 13 of Rule 67, the plaintiff acquires the right to enter and title to the property only upon judgment and payment of just compensation.

Disposition

The appeal was dismissed for lack of merit, and the Decision of the trial court awarding 72,960 pesos as just compensation was affirmed.

Remember This

Memorize this line: just compensation is fixed as of the time of taking, with legal interest thereafter, and due process is satisfied by an opportunity to be heard, not necessarily a formal hearing. Examiners use this case to test the two phases of expropriation, the effect of a final order of condemnation, and the requisites for damages in expropriation.