G.R. No. 110478 , G.R. No. 116176 and G.R. Nos. 116491-503; October 15, 2007
FERMIN MANAPAT, et al., Petitioners, vs. COURT OF APPEALS and NATIONAL HOUSING AUTHORITY, Respondents. (Consolidated Cases)

FACTS

The consolidated cases involve parcels of land in Grace Park, Caloocan City, originally owned by the Roman Catholic Archbishop of Manila (RCAM)/Philippine Realty Corporation (PRC). In the 1960s, occupants petitioned the government for acquisition and resale at low cost. Initial government efforts failed, leading RCAM to subdivide and sell the lots directly to individuals, including petitioners Manapat and Lim and other respondent lot owners. In 1977, President Marcos issued P.D. No. 1072, appropriating funds for expropriation. The National Housing Authority (NHA) subsequently filed multiple expropriation cases to develop the area under the Zonal Improvement Program (ZIP) for low-cost resale to residents.
The Regional Trial Court (RTC) initially dismissed most expropriation cases but later amended some decisions upon NHA’s motion, ordering condemnation and fixing just compensation. Both NHA and the lot owners appealed various aspects to the Court of Appeals (CA). The CA consolidated the appeals and, in its 1993 decision, reversed the dismissals, ordered condemnation in most cases, and remanded them for proper determination of just compensation, annulling the RTC’s fixed rate. Some lot owners elevated the case to the Supreme Court.

ISSUE

The core issue is whether the NHA’s expropriation of the already subdivided and privately owned lots for the ZIP project is valid and for a public purpose.

RULING

The Supreme Court upheld the validity of the expropriation. The legal logic rests on the established principle that the exercise of eminent domain requires a genuine public purpose. The Court found that the NHA’s ZIP project, aimed at slum improvement and providing low-cost housing to underprivileged residents, unequivocally qualifies as a public purpose. The fact that the lots were already subdivided and owned by private individuals does not negate this public use. The taking is for a comprehensive urban development scheme intended for the benefit of a significant segment of the community, not for a select few.
The Court further ruled that the determination of just compensation was correctly remanded to the trial court. The CA correctly annulled the RTC’s fixed rate of ₱180 per square meter, as just compensation must be based on the property’s value at the time of taking, considering all relevant factors, and determined in accordance with the procedure outlined in Rule 67 of the Rules of Court. The expropriation proceedings, though lengthy, were undertaken in accordance with law, and the public purpose of providing socialized housing justifies the state’s exercise of its eminent domain power over the subject properties.