G.R. No. L-6301 October 30, 1954
The Municipal Government of Caloocan, Province of Rizal, plaintiff-appellee, vs. Choan Huat & Co., Inc., defendant-appellant.

FACTS

The Municipality of Caloocan filed a complaint in the Court of First Instance of Rizal to expropriate a parcel of land (Lot No. 2468, 12,068 square meters) owned by Choan Huat & Co., Inc., a corporation whose stock is mostly owned by Chinese citizens, pursuant to Republic Act No. 267 . The defendant moved to dismiss the complaint, arguing that Republic Act No. 267 does not apply to small parcels of land, citing the case of Guido vs. Rural Progress Administration. The defendant also alleged the expropriation was intended to frustrate the execution of a judgment in a forcible entry case it had won against intruders on the land. The trial court initially dismissed the complaint based on the Guido ruling. However, upon the plaintiff’s motion, the court set aside the dismissal, citing the Krivenko vs. Register of Deeds rule that aliens (and corporations owned by them) are disqualified from acquiring and holding land titles. The court then appointed commissioners to appraise the land’s value. The commissioners submitted a report, which the court disregarded, instead fixing the market value at P5 per square meter and declaring the land expropriated in favor of the plaintiff. The defendant appealed.

ISSUE

Whether the Municipality of Caloocan has the authority under Republic Act No. 267 to expropriate the subject parcel of land, which is a small lot owned by a corporation with alien stockholders.

RULING

No. The Supreme Court annulled the judgment of expropriation and reinstated the order dismissing the complaint. The Court held that Republic Act No. 267 does not authorize the expropriation of small parcels of land. It reiterated the doctrine from Guido vs. Rural Progress Administration that the expropriation of a small property for the benefit of a few families does not constitute a public use sufficient to justify the exercise of eminent domain. The Court cited subsequent cases applying the same rule to lands of similar or smaller areas (22,655 sqm, 10,565 sqm, 7,270 sqm). The fact that the land is owned by a corporation with alien stockholders does not legitimize the expropriation under the Act. If the corporation is disqualified from owning land under the Krivenko rule, expropriation is not the proper proceeding to divest its title, as condemnation presupposes the defendant’s ownership. Since the municipal corporation had no authority to condemn the land, the proceedings to determine its value were null and void.