Beluso v. Panay

G.R. No. 153974 (August 7, 2006)

Miguel Beluso won against Panay; SC ruled expropriation invalid for lacking proper ordinance.

Facts:

The petitioners, Miguel Beluso and others, are the owners of several parcels of land totaling approximately 20,424 square meters, covered by Free Patent Nos. 7265 to 7270. On November 8, 1995, the Sangguniang Bayan of the Municipality of Panay passed Resolution No. 95-29, which authorized the municipal government to initiate expropriation proceedings. Subsequently, on April 14, 1997, the Municipality of Panay filed a petition for expropriation before the Regional Trial Court (RTC) of Roxas City, which was docketed as Civil Case No. V-6958.

The petitioners filed a Motion to Dismiss the expropriation petition, arguing that the taking was not for public use but rather politically motivated, as they had voted against the incumbent mayor and vice-mayor. They also claimed that some individuals listed as beneficiaries had not signed the petition, alleging forgery or misrepresentation. The RTC denied the Motion to Dismiss on July 31, 1997, asserting that the expropriation was for public use and that the municipality had the right to take the property upon payment of just compensation.

Following this, the petitioners filed an Answer reiterating their objections. On October 1, 1997, the RTC appointed commissioners to determine just compensation for the property. The petitioners then sought to hold the hearing in abeyance, which was denied. They subsequently filed a Petition for Certiorari with the Court of Appeals (CA), claiming denial of due process and grave abuse of discretion by the RTC.

On March 20, 2002, the CA dismissed the Petition for Certiorari, ruling that the petitioners were not denied due process and that the taking constituted public use. The petitioners filed a Motion for Reconsideration, which was denied on June 11, 2002. They then elevated the matter to the Supreme Court, raising several legal issues regarding the validity of the expropriation proceedings.

Legal Issues:

  1. Whether the Municipality of Panay had the lawful power to expropriate the properties through a mere resolution instead of an ordinance as required by law.
  2. Whether the petitioners were denied procedural due process in the expropriation proceedings.
  3. Whether the expropriation was for public use or politically motivated.

Arguments:

Petitioners' Arguments:

  • The expropriation was based on a resolution rather than an ordinance, violating Section 19 of Republic Act No. 7160 (Local Government Code), which requires an ordinance for the exercise of eminent domain.
  • The previous offer to buy the properties was invalid as it was significantly lower than the market value.
  • The CA failed to address their arguments regarding the lack of lawful power to expropriate and the alleged political motivations behind the expropriation.
  • They asserted that the RTC should have conducted a hearing to allow both parties to present evidence regarding the purpose of the expropriation.

Respondent's Arguments:

  • The Municipality of Panay contended that it had the lawful authority to expropriate the properties and that the trial court's decision was correct.
  • The CA found that the petitioners were not denied due process, as they had the opportunity to present their defenses.
  • The arguments raised by the petitioners had been adequately addressed and dismissed by both the RTC and the CA.

Court's Decision and Legal Reasoning:

The Supreme Court granted the petition, reversing the CA's decision and dismissing the expropriation complaint without prejudice. The Court emphasized that the power of eminent domain, while delegated to local government units (LGUs), is not absolute and must conform to the limits imposed by law. Specifically, the Court highlighted that Section 19 of R.A. No. 7160 explicitly requires an ordinance for the exercise of eminent domain, and a mere resolution is insufficient.

The Court noted that the expropriation was based solely on a resolution, rendering it defective. It clarified that an ordinance is a law with a general and permanent character, while a resolution is merely a temporary declaration of sentiment. The Court also acknowledged that while the petitioners did not raise the issue of the resolution's validity at the earliest opportunity, it was still meritorious enough to consider.

The Court concluded that the respondent could not expropriate the properties without complying with the legal requirements, particularly the necessity of an ordinance. However, it also stated that the respondent was not barred from instituting similar proceedings in the future, provided it adhered to the legal requisites.

Significant Legal Principles Established:

  • The exercise of eminent domain by local government units must be conducted through an ordinance, not merely a resolution.
  • The power of eminent domain is a delegated authority that must conform to the limitations set by the law conferring such power.
  • The courts have a duty to scrutinize the exercise of eminent domain to ensure compliance with legal requirements and the protection of property rights.