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Republic

v BPI
GR 203039 | September 11, 2013
J. CARPIO

Doctrine:
The general rule is that the just compensation to which the owner of the condemned property is entitled
to is the market value. Market value is that sum of money which a person desirous but not compelled to
buy, and an owner willing but not compelled to sell, would agree on as a price to be paid by the buyer and
received by the seller.

The general rule, however, is modified where only a part of a certain property is expropriated. In such a
case, the owner is not restricted to compensation for the portion actually taken; he is also entitled to
recover the consequential damage, if any, to the remaining part of the property.

Facts:
DPWH filed with RTC Las Pias a case for expropriation against portions of the properties of BPI
and of Bayan Villanueva, situated in Pamplona, Las Pias.
o DPWH needed 281 square meters of BPIs lot and 177 square meters from Villanuevas lot
for the construction of the Zapote-Alabang Fly-Over.
Neither BPI nor Villanueva objected to the propriety of the expropriation.
RTC constituted a Board of Commissioners to determine the just compensation.
o In the Report, the mount of P40,000 per square meter was recommended as the fair market
value.
RTC, in its decision, set the fair market value at P40,000 per square meter.
BPI: 281 sq. m. x P40,000 = P11,240,000
Villanueva: 177 sq. m. x P40, 000 = P7,080,000
The acting branch clerk of court issued a Certification, stating that the said decision has become
final, executory and unappealable.
BPI filed a Motion for Partial New Trial to determine the just compensation of the building, which
was not included in the RTC decision.
o RTC granted partial new trial.
Due to the failure of counsel for petitioner, despite notice, to appear during the scheduled hearing
for the determination of the just compensation of the building, RTC allowed BPI to present its
evidence ex-parte.
o After an ocular inspection of the building, Leticia Agbayani, commissioner, reported the
following findings:
A new building was constructed, and said building was attached and made as an
integral part of the original building.
The building was moved back when it was constructed to conform with the
requirement of the Building Code.
Improvements were introduced around the building.
RTC ruled that just compensation for the building was due, and ordered petitioner to pay the
additional amount of P2.6M.
Petitioner moved for MR, on the ground that the proceeding fixing the just compensation of the
building is null and void for not complying with the mandatory procedure laid out in the Rules of
Court.
o RTC granted MR of petitioner; BPI filed MR, stating that there was substantial compliance
with the Rules; RTC denied MR of BPI.
RTC gave petitioner and BPI ten days to submit their respective nominees and their oaths of office.
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o BPI nominated Roland Savellano.
o Petitioner, instead of submitting its nominee, filed a Manifestation and Motion, objecting to
the propriety of paying just compensation for BPIs building and praying that BPIs claim
for additional just compensation was denied.
Petitioner claimed that the building was never taken by the government.
In support, petitioner attached a letter from the DPWH:
o x x x the original plan affecting the subject property was not
implemented. The width of the sidewalk at the premises under
consideration was reduced from 2.5m to 2.35m to avoid the costly
structure of the bank.
BPI claimed that it was not aware that the original plan was not implemented.
After being ordered to submit its nominee, petitioner nominated Romulo Gervacio, the OIC of the
City Assessors Office in Las Pias City.
o BPIs Savellano recommended the amount of P2.6M, based on the appraisal conducted by
an independent professional business and property consultant.
o Petitioners Gervacio recommended P1.9M, which was the market value indicated on the
tax declaration of said building.
RTC adopted the recommendation of Gervacio.
o Petitioner filed an appeal with CA, stating that the previous decision which was declared
final and executory has attained finality.
CA dismissed appeal, and affirmed the RTC ruling; petitioner filed the present
petition before SC.

Issues and Holding:
W/N the award of additional just compensation for BPIs building is unfounded and without legal
basis. No.
o Eminent domain is the authority and right of the State, as sovereign, to take private
property for public use upon observance of due process of law and payment of just
compensation.
Just compensation is the full and fair equivalent of the property sought to be
expropriated.
o The general rule is that the just compensation to which the owner of the condemned
property is entitled to is the market value.
Market value is that sum of money which a person desirous but not compelled to
buy, and an owner willing but not compelled to sell, would agree on as a price to be
paid by the buyer and received by the seller.
o The general rule is modified where only a part of a certain property is expropriated.
In this case, the owner is not restricted to compensation for the portion actually
taken, as he is also entitled to recover the consequential damage, if any, to the
remaining part of the property.
o In the present case, petitioner contends that BPIs building was never taken by petitioner,
and that to award consequential damages for the building was unfounded and without legal
basis.
o SC held that no actual taking of the building is necessary to grant consequential damages.
Consequential damages are awarded if, as a result of the expropriation, the
remaining property of the owner suffers from an impairment or decrease in value.
o To determine just compensation, the trial court should first as certain the market value of
the property, to which should be added the consequential damages after deducting
therefrom the consequential benefits which may arise from the expropriation.

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If the consequential benefits should exceed the consequential damages, these items
are regarded altogether as the basic value of the property, which should be paid in
every case.

Ruling:
Petition denied.

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