G. R. No. 35490. October 12, 1932
THE METROPOLITAN WATER DISTRICT, PLAINTIFF AND APPELLANT, VS. THE DIRECTOR OF LANDS AND MARIANO ESCUETA, DEFENDANTS AND APPELLEES.
MALCOLM, J.:
the just compensation to be paid by the Metropolitan Water District for the
taking of 663 hectares of land for the use of the Angat Waterworks System, and
the” second having to do with determining to whom the money should be paid.
On February 13, 1926, the Metropolitan Water District instituted an action in
the Court of First Instance of Rizal for the expropriation of thirty-seven
parcels of friar lands. The complaint alleged that the Director of Lands is the
administrator of the lands, they being portions of the Tala Friar Lands Estate
belonging to the Government of the Philippine Islands, and that Mariano Escueta
claims an interest in the lands, he being the holder of sales certificates
covering said parcels. To the complaint Escueta interposed an answer in which he
prayed that the value of the land be fixed at P371,342.46. To the complaint the
Director of Lands also interposed an answer in which he prayed for judgment in
the sum of P17,141.79, representing the balance due and payable on the lots, the
subject of this case. The court appointed three commissioners who, after hearing
the parties, submitted two reports. Two of the commissioners arrived at P216,099
and the third commissioner at P100,125.36 as the value of the property. The
trial judge accepting the viewpoint of the majority commissioners gave judgment
accordingly in favor of Mariano Escueta against the plaintiff, with legal
interest from February 13, 1926, until payment, and with costs, with a previous
reduction of the amounts due the Bureau of Lands, From this judgment the
Metropolitan Water District has taken an appeal.
Coming now to the consideration of the first major problem, which consists in
approximating the market value of the property being expropriated, we have
various factors to be observed. We have first to ascertain the portion of the
land which was cultivated and the portion which was uncultivated. We have next
to set a valuation per hectare on the cultivated and uncultivated portions of
the property. We have lastly to decide as to the value of the improvements. The
record relating to these points is bulky, and a vast amount of testimony
conflicting in many respects will be found therein. It is for us, without
getting lost in the mazes of such a record, to concentrate on certain facts on
which a correct judgment may be predicated.
In the first place, it should be explained that in 1910, the Director of
Lands on behalf of the Government of the Philippine Islands agreed to sell to
Mariano. Kscueta thirty-seven parcels of friar lands for P21,831, to be paid in
twenty annual installments. Of this amount Escueta has paid the sum of P7,564.45
and P979.69 as interest. Since 1918 Escueta has been in arrears. The unpaid
balance with accrued interest comes to more than P21,756.82, Since the
acquisition of the property in 1910, it has been improved by Escueta to some
extent. The value of the property is of course to be fixed as of 1926, when
these expropriation proceedings were begun.
We have hereinbefore mentioned certain figures as for instance, the report of
the majority commissioners, approved by the trial court, naming P216,099 as the
value of the property, and the report of the minority commissioner naming
P100,125.36 for the same purpose. As minor points, it should further be
mentioned that the property is assessed for tax purposes at P23,960, and that it
was mortgaged to the Philippine National Bank in 1918 for P20,000. In 1926
Escueta offered the property to the water district for P100,528.98, which
proposition was rejected by the water district, which would only concede to
Escueta P61,683.76.
Purchases and sales of property adjoining that being expropriated are
competent and material evidence to determine the true market value of
expropriated land. Such evidence was here introduced and discloses that in that
vicinity the prices for cultivated rice land range from P500 to P625 a hectare,
for dcdatan land from P250 to P300 a -hectare, while for uncultivated land the
price was uniformly P66 a hectare. Escueta claims that these prices are low and
in this claim he receives support from all three of the commissioners. The
principal reason for arguing that Escueta’s land should be placed at a higher
figure than adjoining properties relates to its topography and the fact that it
is more valuable for the purposes of the water district than are contiguous
properties.
Various estimates have also been made as to the portions of the property
which are cultivated and uncultivated. The majority commissioners, after
conducting: ocular inspections, stated that 22 hectares were rice land, 121
hectares dalatan land, 17 hectares suitable for other purposes, and 502 hectares
uncultivated, while the minority commissioner stated that there were 20 hectares
of rice land, 79 hectares of dalatan land, and 564 hectares uncultivated. The
survey disclosed 53 hectares cultivated and the rest uncultivated. Escueta in
presenting his claim to the water district insisted that 28 and 79 hectares were
cultivated and 554 uncultivated. The Government contends that 21 hectares are
rice land, 33 hectares dalatan land, and 610 hectares uncultivated.
The valuation of the improvements discloses an even greater range of
differences. While the majority commissioners and the court would allow for
fruit trees P4,780, for other trees and shrubs P45,000, for cogon, etc.,
P15,185, or a total of P64,865, and while the minority commissioner would allow
for fruit trees P4,780, the Government will only concede for improvements P546.
In our opinion, the amount fixed by the majority commissioners and the trial
court for the improvements is palpably exorbitant, particularly in the sums
allowed for trees and shrubs on this isolated property. The amount of P4,780 for
improvements is more nearly appropriate.
Bluntly stating our conclusion, as premised on the previous discussion, we
arrive at P100,000 as just compensation for the property. We place particular
reliance on the well-considered report of Tomas Arguelles whose excellent
reputation and careful work in matters of this kind are well known to the court,
on the offer of Escueta to the water district in 1926, and on the sales and
purchases made in the immediate vicinity, increased somewhat to take into
account the probable greater value of the land being expropriated.
Having reached the foregoing result, the second question is as to whom the
money should be paid by the Metropolitan Water District. We can only proceed on
the record before us. That record shows a sale of friar lands by the Bureau of
Lands to Escueta in 1910, on the installment plan, without the purchase price
having been fully paid. The Friar Lands Law, Act No. 1120, as amended by Act No.
2642, provides that the Government reserves the title to each and every parcel
of land sold under the provisions of this Act until the full payment of all
installments of purchase money and interest by the purchaser has been made. The
law further provides that in the event that any purchaser of land under the
provisions of this Act should fail to pay any installment of purchase money and
interest thereon, or accrued interest on any installment not due, when and as
the same matures, it shall be the duty of the Director of Lands at once to
protect the Government from loss; the Director of Lands may enforce payment of
any past due installment and interest by bringing suit to recover the same with
interest thereon, and may also enforce the lien of the Government against the
land by selling the same in the manner provided in the Code of Civil Procedure
for the foreclosure of mortgages.
When these expropriation proceedings were initiated the Director of Lands
contented himself with asking for reimbursement for the amount not paid by
Escueta. It was only after the case had been submitted to this court that the
Director of Lands asked for dismissal as to Escueta on the ground that the
Director of Lands with the approval of the Secretary of Agriculture and Natural
Resources had rescinded the sales contract in favor of Escueta. This petition
came so tardily to our notice that the court was forced to state in an order
what was obvious, that the case must be decided on the record when the case was
submitted to the court. The power of the State to take private property by the
exercise of its right of eminent domain extends to every variety and degree of
interest therein. It would here extend to the possible interest of the Director
of Lands on the one hand and of Escueta on the other “hand. But an exact ruling
on their respective rights, if any, can not now be made because not properly at
issue and because the necessary evidentiary facts are lacking, and so. must be
left for decision after the return of the record to the court below.
Consonant with the foregoing, the judgment appealed from will be modified by
reducing the amount therein named of P216,099 to P100,000, with legal interest
from February 13, 1926, the said amount to be paid into the Court of First
Instance of Rizal by the Metropolitan Water District, and thereafter the
Director of Lands and Mariano Escueta to move in the premises in order that
after hearing it may be determined to what entity or person the money should be
paid. So ordered, without express pronouncement as to costs in either instance.
Avanceña, C. J., Ostrand, Villa-Real, Abad Santos, Hull, Vickers,
Imperial, and Butte, JJ., concur.