(1) OSG v Ayala Land (2) Ortega v City of Cebu

E. DUE PROCESS AND EMINENT DOMAIN SOLICITOR GENERAL v AYALA LAND 600 SCRA 617, G.R. No. 177056, 18 SEPT 2009 FACTS: This is a petition for review on certiorari filed by petitioner that seeks the reversal and setting aside the decision of the CA affirming the decision of the RTC, which denied the motion for reconsideration of the petitioner. The RTC ruled that the respondents Ayala Land, Robinsons Land, Shangri-La Plaza, and SM Prime Holdings have no obligation to provide the parking spaces in their malls free of charge. Senate Committee Report No. 225 (SCR 225), after a joint investigation by the Senate Committees on Trade and Commerce and on Justice and Human Rights, recommended that charging parking fees is against RA 7394 or the Consumer Act and against PD 1096 or the National Building Code, and that PD 1096 should be amended to prohibit mall operators from imposing parking fees. After the release of SCR 225, Respondent SM received information that the DPWH Sec. and the local building officials of Manila, Quezon City, and Las Piñas intended to institute, through the OSG, an action to enjoin respondent SM Prime and similar establishments from collecting parking fees, and to impose upon said establishments penal sanctions under PD 1096, and its IRR. Respondent SM filed a Petition for Declaratory Relief against the said officials. The OSG subsequently filed a Petition for Declaratory Relief against the respondents. The Makati RTC consolidated the two cases and rendered judgment in favour of the respondents. The RTC pronounced that the National Building Code (PD 1069) does not impose that parking spaces provided by the mall owners shall be free of charge. Parking spaces in shopping malls are privately owned and for their use, the mall operators collect fees. Should parking spaces be made free, this right of mall owners shall be gone. This, without just compensation. Further, loss of effective control over their property will ensue which is frowned upon by law. RTC: FOR THE REASONS GIVEN, the Court declares that the respondents are not obligated to provide parking spaces in their malls for the use of their patrons or public in general, free of charge. CA: WHEREFORE, premises considered, the instant appeals are DENIED. Accordingly, appealed Decision is hereby AFFIRMED in toto. ISSUE: WON the CA erred in affirming the RTC’s ruling that respondents are not obliged to provide free parking spaces to their patrons or to the public. HELD: The Court finds no merit in the present Petition. The explicit directive of the afore-quoted statutory and regulatory provisions, garnered from a plain reading

thereof, is that respondents, as operators/lessors of neighborhood shopping centers, should provide parking and loading spaces, in accordance with the minimum ratio of one slot per 100 square meters of shopping floor area. There is nothing therein pertaining to the collection (or non-collection) of parking fees by respondents. In fact, the term “parking fees” cannot even be found at all in the entire Code and its IRR. Statutory construction has it that if a statute is clear and unequivocal, it must be given its literal meaning and applied without any attempt at interpretation. From the RTC all the way to this Court, the OSG repeatedly referred to Republic v. Gonzales and City of Ozamis v. Lumapas to support its position that the State has the power to regulate parking spaces to promote the health, safety, and welfare of the public. The OSG failed to consider the differences in the factual and legal backgrounds of these two cases from the present case. Both cases were on regulating parking on public property (on streets). In City of Ozamis, the Court authorized the collection by the City of minimal fees for the parking of vehicles along the streets. It is not sufficient for the OSG to claim that “the power to regulate and control the use, occupancy, and maintenance of buildings and structures carries with it the power to impose fees and, conversely, to control, partially or, as in this case, absolutely, the imposition of such fees.” The present case does not involve public officials to impose regulatory fees, but it is about the imposition of parking fees by mall operators. The OSG is actually invoking police power to justify the regulation by the State, through the DPWH Sec. and local building officials, of privately-owned parking facilities, including the collection by the owners of such facilities of parking fees from the public for the use thereof. In totally prohibiting respondents from collecting parking fees from the public for the use of the mall parking facilities, the State would be acting beyond the bounds of police power. When there is a taking or confiscation of private property for public use, the State is no longer exercising police power but eminent domain. The latter enables the State to forcibly acquire private lands intended for public use upon payment of just compensation to the owner. The State is not only requiring that respondents devote a portion of the latter’s properties for use as parking spaces, but is also mandating that they give the public access to said parking spaces for free. Such is already an excessive intrusion into the property rights of respondents. Not only are they being deprived of the right to use a portion of their properties as they wish, they are further prohibited from profiting from its use or even just recovering therefrom the expenses for the maintenance and operation of the required parking facilities. WHEREFORE, the instant Petition for Review on

Certiorari is hereby DENIED.

SPOUSES ORTEGA v CITY OF CEBU 602 SCRA 301, G.R. No. 181562-63, 02 OCT 2009 FACTS: These are consolidated petitions for review on certiorari filed by petitioners Ciriaco and Arminda Ortega (Spouses Ortega) and petitioner City of Cebu (Cebu City) assailing the Decision of the Court of Appeals (CA) in the similarly consolidated petition. Spouses Ciriaco and Arminda Ortega are the owners of a parcel of land situated in Hippodromo, Cebu City. Approximately half of it is occupied by informal settlers. On 24 Sept. 1990, the petitioners filed an ejectment case against the squatters before the MTC of Cebu City, which rendered decision in favor of the petitioner spouses. The case eventually reached the Supreme Court, which affirmed the decision of the MTC. The decision of the MTC became final and executory, and a writ of execution was issued on February 1, 1994. On May 23, 1994, the Cebu City Council enacted City Ordinance No. 1519, giving authority to the City Mayor to expropriate 1/2 (2,856 m2) of the petitioner’s land, and appropriating for that purpose. The amount will be charged against Continuing Appropriation, repurchase of lots for various projects. The value of the land was determined by the Cebu City Appraisal Committee in Resolution No. 19 dated April 15, 1994. Pursuant to the ordinance, the city filed a Complaint for Eminent Domain before the Cebu RTC against the petitioner spouses. RTC (1): On 13 March 1998, the RTC issued an order declaring that Cebu City “has the lawful right to take the property subject of the instant case, for public use or purpose described in the complaint upon payment of just compensation.” This allows the city to invoke the power of eminent domain. RTC (2): Upon recommendation of the City Assessors Office, the RTC issued another Order dated 21 May 1999, fixing the value of the land subject to expropriation at P11,000.00 per m2 and ordering Cebu City to pay the petitioner spouses the sum of P31,416,000.00 as just compensation for the expropriated portion of the property. The Cebu RTC’s decision became final and executory because of Cebu City’s failure to perfect an appeal on time, and a Writ of Execution was issued on 17 September1999 to enforce the court’s judgment. Upon motion of the petitioner spouses, the RTC issued an Order dated March 11, 2002 for execution or garnishment. The City filed an Omnibus Motion to Stay Execution, Modification of Judgment and Withdrawal of the Case, contending that the price set by the RTC as just compensation to be paid to the petitioner spouses

exceeds the reach of its intended beneficiaries for its socialized housing program. The motion was denied by the Cebu RTC. Cebu City’s Motion for Reconsideration was likewise denied. By virtue of the RTC order, dated 02 July 2003, the Sheriff served a Notice of Garnishment to Philippine Postal Bank, 2 Cebu City branches, garnishing Cebu City’s bank deposit therein. Cebu City filed the instant Petition for Certiorari before the CA. Cebu City filed before the RTC a Motion to Dissolve, Quash or Recall the Writ of Garnishment, contending that Account No. 101-8918-334 mentioned in Ordinance No. 1519 is not actually an existing bank account and that the garnishment of Cebu City’s bank account with Philippine Postal Bank was illegal, because government funds and properties may not be seized under writ of execution or garnishment to satisfy such judgment, on obvious reason of public policy. The Cebu RTC issued an Order dated March 8, 2004, denying said motion. Cebu City’s Motion for Reconsideration was also denied. The petitioner spouses filed an Ex-Parte Motion to Direct the New Manager of Philippine Postal Bank to Release to the Sheriff the Garnished Amount, which was granted by the RTC. The City Government filed a Motion for Reconsideration, but the same was denied. CA: WHEREFORE, all the foregoing premises considered, the instant Petitions for Certiorari are hereby PARTIALLY GRANTED. The assailed Orders of the RTC are hereby ANNULLED AND SET ASIDE insofar as they denied Cebu City’s Motion to Stay Execution, but they are hereby AFFIRMED insofar as they denied Cebu City’s Motion to Modify Judgment and Withdraw from the Expropriation Proceedings. Furthermore, the assailed Orders of the RTC dated March 8, 2004 in CA-G.R. SP NO. 00147 are hereby ANNULLED AND SET ASIDE. Let the Decision of the RTC be executed in a manner prescribed by applicable law and jurisprudence. ISSUE: Is determining the amount of just compensation in the exercise of the power of eminent domain a prerogative of the judiciary? HELD: It is well settled in jurisprudence that the determination of just compensation is a judicial prerogative. 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 statue, decree, or executive order can mandate that its own determination shall prevail over the court’s findings.