Constitutional Law, Remedial Law

EPZA v. DULAY G.R. No. L-59603, April 29, 1987 Expropriation, Just Compensation


On January 15, 1979, the President issued Proclamation No. 1811, reserving a certain parcel of land of the public domain situated in the Lapu-Lapu City, Mactan, Cebu and covering a total area of 1,193,669 square meters, more or less, for the establishment of an export processing zone by petitioner Export Processing Zone Authority (EPZA).

However, four (4) parcels of land are owned and registered in the name of the private respondent. 

The petitioner filed with the then CFI a complaint for expropriation against the private respondent, to expropriate the aforesaid parcels of land pursuant to P.D. No. 66, as amended, which empowers the petitioner to acquire by condemnation proceedings any property for the establishment of export processing zones.

The respondent judge issued a writ of possession authorizing the petitioner to take immediate possession of the premises. The respondent judge also issued a second order, subject of this petition, appointing certain persons as commissioners to ascertain and report to the court the just compensation for the properties sought to be expropriated.

The petitioner EPZA filed a Motion for Reconsideration and Objection to Commissioner’s Report on the grounds that P.D. No. 1533 has superseded Sections 5 to 8 of Rule 67 of the Rules of Court on the ascertainment of just compensation through commissioners.

The trial court denied the petitioner’s motion for reconsideration and gave the latter ten (10) days within which to file its objection to the Commissioner’s Report.

The petitioner filed this present petition for certiorari and mandamus with preliminary restraining order.

The petitioner maintains that the respondent judge acted in excess of his jurisdiction and with grave abuse of discretion because under P.D. No. 1533, which is the applicable law herein, the basis of just compensation shall be the fair and current market value declared by the owner of the property sought to be expropriated or such market value as determined by the assessor, whichever is lower. Therefore, there is no more need to appoint commissioners as prescribed by Rule 67 of the Revised Rules of Court and for said commissioners to consider other highly variable factors in order to determine just compensation.


Whether P.D. No. 1533, which eliminates the court’s discretion to appoint commissioners pursuant to Rule 67 of the Rules of Court, is constitutional. 


We are constrained to declare the provisions of the Decrees on just compensation unconstitutional and void and accordingly dismiss the instant petition for lack of merit.

The method of ascertaining just compensation under the aforecited decrees constitutes impermissible encroachment on judicial prerogatives. It tends to render this Court inutile in a matter which under the Constitution is reserved to it for final determination.

We are convinced and so rule that the trial court correctly stated that the valuation in the decree may only serve as a guiding principle or one of the factors in determining just compensation but it may not substitute the court’s own judgment as to what amount should be awarded and how to arrive at such amount. 

Just compensation means the value of the property at the time of the taking. It means a fair and full equivalent for the loss sustained. All the facts as to the condition of the property and its surroundings, its improvements and capabilities, should be considered.

The determination of “just compensation” in eminent domain cases is a judicial function. The executive department or the legislature may make the initial determinations but when a party claims a violation of the guarantee in the Bill of Rights that private property 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 court’s findings. Much less can the courts be precluded from looking into the “just-ness” of the decreed compensation.

We, therefore, hold that P.D. No. 1533, which eliminates the court’s discretion to appoint commissioners pursuant to Rule 67 of the Rules of Court, is unconstitutional and void.

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