G.R. No. L-15946. February 28, 1964.
PROVINCE OF BULACAN, plaintiff-appellant, vs. B. E. SAN DIEGO, INC., ET AL., defendants-appellees.

FACTS

The Province of Bulacan, pursuant to a resolution of its Provincial Board and under the authority of Republic Acts Nos. 267 and 498, filed a complaint to expropriate a portion of Hacienda Esguerra, owned by B. E. San Diego, Inc., for the purpose of subdividing and reselling the land to its tenants and landless residents. The initial complaint covered approximately 64 hectares. However, several lots were subsequently excluded after a government agency claimed prior purchase, reducing the subject property to about 26 hectares situated across three municipalities. The defendant moved to dismiss the amended complaint, arguing the property was not a “landed estate” as contemplated by law, the intended use was not for a public purpose, and portions had already been sold to private parties. The Court of First Instance granted the motion to dismiss, prompting this appeal.

ISSUE

The core issue is whether the 26-hectare property, already partially subdivided and sold, qualifies as a “landed estate” subject to expropriation under Republic Acts Nos. 267 and 498, which authorize local governments to acquire such estates for resale to residents.

RULING

The Supreme Court affirmed the dismissal, ruling the amended complaint stated no cause of action. The Court applied the controlling doctrine established in Province of Rizal vs. B. E. San Diego, Inc. (G.R. No. L-10802), a prior case involving the same corporate defendant and a similar parcel from the same hacienda. There, the Court held that a landed estate, for purposes of expropriation under the cited laws and the Constitution, refers to an extensive area embracing a whole or large part of a town or city. Once such an estate is broken up and divided into parcels of reasonable area—whether through voluntary sales or prior expropriation—the resulting parcels are no longer subject to further expropriation under that specific constitutional provision. The Court explicitly abandoned the contrary ruling in Rural Progress Administration vs. Reyes and reaffirmed the “sound and wholesome” doctrine from Guido vs. Rural Progress Administration. Consequently, the 26-hectare remnant of Hacienda Esguerra, having been subdivided and partially sold, did not constitute the type of extensive landed estate the law intended to address. Expropriation cannot be justified merely to enable tenants to acquire land at a lower cost; it requires a genuine public purpose and benefit, which was not sufficiently alleged under the circumstances.