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Republic of the Philippines

SUPREME COURT

Manila

EN BANC

G.R. No. 78742 July 14, 1989

ASSOCIATION OF SMALL LANDOWNERS IN TE PILIPPINES, INC., JUANITO D. GOME!,

GERARDO ". ALARCIO, FELIPE A. GUICO, JR., "ERNARDO M. ALMONTE, CANUTO RAMIR ".

CA"RITO, ISIDRO T. GUICO, FELISA I. LLAMIDO, FAUSTO J. SAL#A, RE$NALDO G. ESTRADA,

FELISA C. "AUTISTA, ESMENIA J. CA"E, TEODORO ". MADRIAGA, AUREA J. PRESTOSA,

EMERENCIANA J. ISLA, FELICISIMA C. ARRESTO, CONSUELO M. MORALES, "ENJAMIN R.

SEGISMUNDO, CIRILA A. JOSE % NAPOLEON S. FERRER, petitioners,

vs.

ONORA"LE SECRETAR$ OF AGRARIAN REFORM, respondent.

G.R. No. 79&1' July 14, 1989

ARSENIO AL. ACUNA, NEWTON JISON, #ICTORINO FERRARIS, DENNIS JERE!A, ERMINIGILDO

GUSTILO, PAULINO D. TOLENTINO ()* PLANTERS+ COMMITTEE, INC., #-o/(0 Mll D0/-,

#-o/(0, N/o0 O--*)(l, petitioners,

vs.

JO3ER ARRO$O, PILIP E. JUICO ()* PRESIDENTIAL AGRARIAN REFORM COUNCIL,

respondents. 

G.R. No. 79744 July 14, 1989

INOCENTES PA"ICO, petitioner,vs.

ON. PILIP E. JUICO, SECRETAR$ OF TE DEPARTMENT OF AGRARIAN REFORM, ON.

JO3ER ARRO$O, EECUTI#E SECRETAR$ OF TE OFFICE OF TE PRESIDENT, ()* M00/0.

SAL#ADOR TALENTO, JAIME A"OGADO, CONRADO A#ANCENA ()* RO"ERTO TAA$,

respondents.

G.R. No. 79777 July 14, 1989

NICOLAS S. MANAA$ ()* AGUSTIN ERMANO, JR., petitioners,

vs.

ON. PILIP ELLA JUICO, (0 S-/(/y o5 A/(/() R5o/6, ()* LAND "AN3 OF TE

PILIPPINES, respondents.

CRU!, J.:

In ancient mytholoy, Antaeus !as a terrible iant !ho bloc"ed and challened #ercules for his life on his

!ay to Mycenae after performin his eleventh labor. $he t!o !restled mihtily and #ercules flun his

adversary to the round thin"in him dead, but Antaeus rose even stroner to resume their strule. $his

happened several times to #ercules% increasin ama&ement. 'inally, as they continued rapplin, it

da!ned on #ercules that Antaeus !as the son of (aea and could never die as lon as any part of his

body !as touchin his Mother Earth. $hus fore!arned, #ercules then held Antaeus up in the air, beyondthe reach of the sustainin soil, and crushed him to death.

Mother Earth. $he sustainin soil. $he iver of life, !ithout !hose invioratin touch even the po!erful

 Antaeus !ea"ened and died.

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$he cases before us are not as fanciful as the foreoin tale. But they also tell of the elemental forces of 

life and death, of men and !omen !ho, li"e Antaeus need the sustainin strenth of the precious earth to

stay alive.

)*and for the *andless) is a sloan that underscores the acute imbalance in the distribution of this

precious resource amon our people. But it is more than a sloan. $hrouh the broodin centuries, it has

become a battle+cry dramati&in the increasinly urent demand of the dispossessed amon us for a plot

of earth as their place in the sun.

Reconi&in this need, the Constitution in -/ mandated the policy of social 0ustice to )insure the !ell+

bein and economic security of all the people,) 1  especially the less privileed. In -1, the ne!

Constitution affirmed this oal addin specifically that )the 2tate shall reulate the ac3uisition, o!nership,

use, en0oyment and disposition of private property and e3uitably diffuse property o!nership and profits.) 2

2inificantly, there !as also the specific in0unction to )formulate and implement an ararian reform

proram aimed at emancipatin the tenant from the bondae of the soil.) & 

$he Constitution of -41 !as not to be outdone. Besides echoin these sentiments, it also adopted one

!hole and separate Article 5III on 2ocial 6ustice and #uman Rihts, containin randiose butundoubtedly sincere provisions for the uplift of the common people. $hese include a call in the follo!in

!ords for the adoption by the 2tate of an ararian reform proram7

2EC. 8. $he 2tate shall, by la!, underta"e an ararian reform proram founded on the

riht of farmers and reular farm!or"ers, !ho are landless, to o!n directly or collectively

the lands they till or, in the case of other farm!or"ers, to receive a 0ust share of the fruits

thereof. $o this end, the 2tate shall encourae and underta"e the 0ust distribution of all

aricultural lands, sub0ect to such priorities and reasonable retention limits as the

Conress may prescribe, ta"in into account ecoloical, developmental, or e3uity

considerations and sub0ect to the payment of 0ust compensation. In determinin retention

limits, the 2tate shall respect the riht of small lando!ners. $he 2tate shall further 

provide incentives for voluntary land+sharin.

Earlier, in fact, R.A. No. 488, other!ise "no!n as the Aricultural *and Reform Code, had already been

enacted by the Conress of the Philippines on Auust 4, -9, in line !ith the above+stated principles.

$his !as substantially superseded almost a decade later by P.:. No. ;1, !hich !as promulated on

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23uarely raised in this petition is the constitutionality of P.:. No. ;1, E.

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(.R. No. 1-@

$he petitioners herein are lando!ners and suar planters in the ictorias Mill :istrict, ictorias, Neros

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$he petitioners also decry the penalty for non+reistration of the lands, !hich is the e=propriation of the

said land for an amount e3ual to the overnment assessor%s valuation of the land for ta= purposes.

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$he petitioner contends that the issuance of E.@. Nos. ;;4 and ;;- shortly before Conress convened is

anomalous and arbitrary, besides violatin the doctrine of separation of po!ers. $he leislative po!er 

ranted to the President under the $ransitory Provisions refers only to emerency measures that may be

promulated in the proper e=ercise of the police po!er.

$he petitioner also invo"es his rihts not to be deprived of his property !ithout due process of la! and to

the retention of his small parcels of riceholdin as uaranteed under Article 5III, 2ection 8 of the

Constitution. #e li"e!ise arues that, besides denyin him 0ust compensation for his land, the provisions

of E.

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No. ;1 and Retention by 2mall *ando!ners?, and :AR Administrative Providin for a Cut+off :ate for *ando!ners to Apply for Retention andor to Protest the Coverae of their 

*andholdins under

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(od and its conscience ive it the liht to probe its meanin and discover its purpose. Personal motives

and political considerations are irrelevancies that cannot influence its decision. Blandishment is as

ineffectual as intimidation.

'or all the a!esome po!er of the Conress and the E=ecutive, the Court !ill not hesitate to )ma"e the

hammer fall, and heavily,) to use 6ustice *aurel%s pithy lanuae, !here the acts of these departments, or 

of any public official, betray the people%s !ill as e=pressed in the Constitution.

It need only be added, to borro! aain the !ords of 6ustice *aurel, that G

... !hen the 0udiciary mediates to allocate constitutional boundaries, it does not assert

any superiority over the other departmentsD it does not in reality nullify or invalidate an act

of the *eislature, but only asserts the solemn and sacred obliation assined to it by the

Constitution to determine conflictin claims of authority under the Constitution and to

establish for the parties in an actual controversy the rihts !hich that instrument secures

and uarantees to them. $his is in truth all that is involved in !hat is termed )0udicial

supremacy) !hich properly is the po!er of 0udicial revie! under the Constitution. 1 

$he cases before us cateorically raise constitutional 3uestions that this Court must cateorically resolve.

 And so !e shall.

II

e proceed first to the e=amination of the preliminary issues before resolvin the more serious

challenes to the constitutionality of the several measures involved in these petitions.

$he promulation of P.:. No. ;1 by President Marcos in the e=ercise of his po!ers under martial la! has

already been sustained in Gonzales v. Estrella and !e find no reason to modify or reverse it on that issue.

 As for the po!er of President A3uino to promulate Proc. No. and E.8? of 

 Article I, are not applicable. ith particular reference to 2ection ;8, this obviously could not have been

complied !ith for the simple reason that the #ouse of Representatives, !hich no! has the e=clusive

po!er to initiate appropriation measures, had not yet been convened !hen the proclamation !as issued.

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$he leislative po!er !as then solely vested in the President of the Philippines, !ho embodied, as it

!ere, both houses of Conress.

$he arument of some of the petitioners that Proc. No. and E.PARC? created hereunder, but in no case shall retention by the

lando!ner e=ceed five >/? hectares. $hree >? hectares may be a!arded to each child of 

the lando!ner, sub0ect to the follo!in 3ualifications7 >? that he is at least fifteen >/?

years of aeD and >;? that he is actually tillin the land or directly manain the farmD

Provided, $hat lando!ners !hose lands have been covered by Presidential :ecree No.

;1 shall be allo!ed to "eep the area oriinally retained by them thereunder, further, $hatoriinal homestead rantees or direct compulsory heirs !ho still o!n the oriinal

homestead at the time of the approval of this Act shall retain the same areas as lon as

they continue to cultivate said homestead.

$he arument that E.

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 And !hile it is true that as a rule the !rit !ill not be proper as lon as there is still a plain, speedy and

ade3uate remedy available from the administrative authorities, resort to the courts may still be permitted if 

the issue raised is a 3uestion of la!. 2& 

III

$here are traditional distinctions bet!een the police po!er and the po!er of eminent domain that loically

preclude the application of both po!ers at the same time on the same sub0ect. In the case of City o 

'a(uio v. NA)A*A, 24 for e=ample, !here a la! re3uired the transfer of all municipal !ater!or"s systems

to the NAA2A in e=chane for its assets of e3uivalent value, the Court held that the po!er bein

e=ercised !as eminent domain because the property involved !as !holesome and intended for a public

use. Property condemned under the police po!er is no=ious or intended for a no=ious purpose, such as a

buildin on the vere of collapse, !hich should be demolished for the public safety, or obscene materials,

!hich should be destroyed in the interest of public morals. $he confiscation of such property is not

compensable, unli"e the ta"in of property under the po!er of e=propriation, !hich re3uires the payment

of 0ust compensation to the o!ner.

In the case of Pennsylvania Coal Co. v. Mahon,2

 6ustice #olmes laid do!n the limits of the police po!er in a famous aphorism7 )$he eneral rule at least is that !hile property may be reulated to a certain

e=tent, if reulation oes too far it !ill be reconi&ed as a ta"in.) $he reulation that !ent )too far) !as a

la! prohibitin minin !hich miht cause the subsidence of structures for human habitation constructed

on the land surface. $his !as resisted by a coal company !hich had earlier ranted a deed to the land

over its mine but reserved all minin rihts thereunder, !ith the rantee assumin all ris"s and !aivin

any damae claim. $he Court held the la! could not be sustained !ithout compensatin the rantor.

6ustice Brandeis filed a lone dissent in !hich he arued that there !as a valid e=ercise of the police

po!er. #e said7

Every restriction upon the use of property imposed in the e=ercise of the police po!er 

deprives the o!ner of some riht theretofore en0oyed, and is, in that sense, an

abridment by the 2tate of rihts in property !ithout ma"in compensation. But restriction

imposed to protect the public health, safety or morals from daners threatened is not a

ta"in. $he restriction here in 3uestion is merely the prohibition of a no=ious use. $he

property so restricted remains in the possession of its o!ner. $he state does not

appropriate it or ma"e any use of it. $he state merely prevents the o!ner from ma"in a

use !hich interferes !ith paramount rihts of the public. henever the use prohibited

ceases to be no=ious G as it may because of further chanes in local or social conditions

G the restriction !ill have to be removed and the o!ner !ill aain be free to en0oy his

property as heretofore.

Recent trends, ho!ever, !ould indicate not a polari&ation but a minlin of the police po!er and the

po!er of eminent domain, !ith the latter bein used as an implement of the former li"e the po!er of ta=ation. $he employment of the ta=in po!er to achieve a police purpose has lon been accepted. 2  As

for the po!er of e=propriation, Prof. 6ohn 6. Costonis of the Hniversity of Illinois Collee of *a! >referrin

to the earlier case of Euclid v. Ambler Realty Co., ;1; H2 9/, !hich sustained a &onin la! under the

police po!er? ma"es the follo!in sinificant remar"s7

Euclid, moreover, !as decided in an era !hen 0udes located the Police and eminent

domain po!ers on different planets. (enerally spea"in, they vie!ed eminent domain as

encompassin public ac3uisition of private property for improvements that !ould be

available for public use,) literally construed. $o the police po!er, on the other hand, they

assined the less intrusive tas" of preventin harmful e=ternalities a point reflected in the

Euclid opinion%s reliance on an analoy to nuisance la! to bolster its support of &onin.

2o lon as suppression of a privately authored harm bore a plausible relation to some

leitimate )public purpose,) the pertinent measure need have afforded no compensation

!hatever. ith the proressive ro!th of overnment%s involvement in land use, the

distance bet!een the t!o po!ers has contracted considerably. $oday overnment often

employs eminent domain interchaneably !ith or as a useful complement to the police

po!er++ a trend e=pressly approved in the 2upreme Court%s -/8 decision in Berman v.

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Par"er, !hich broadened the reach of eminent domain%s )public use) test to match that of 

the police po!er%s standard of )public purpose.) 27 

$he Berman case sustained a redevelopment pro0ect and the improvement of blihted areas in the

:istrict of Columbia as a proper e=ercise of the police po!er.

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share the burden of ararian reform, an ob0ection also made by the suar planters on the round that they

belon to a particular class !ith particular interests of their o!n. #o!ever, no evidence has been

submitted to the Court that the re3uisites of a valid classification have been violated.

Classification has been defined as the roupin of persons or thins similar to each other in certain

particulars and different from each other in these same particulars. &1 $o be valid, it must conform to the

follo!in re3uirements7 >? it must be based on substantial distinctionsD >;? it must be ermane to the

purposes of the la!D >? it must not be limited to e=istin conditions onlyD and >8? it must apply e3ually to

all the members of the class. &2 $he Court finds that all these re3uisites have been met by the measures

here challened as arbitrary and discriminatory.

E3ual protection simply means that all persons or thins similarly situated must be treated ali"e both as to

the rihts conferred and the liabilities imposed. && $he petitioners have not sho!n that they belon to a

different class and entitled to a different treatment. $he arument that not only lando!ners but also

o!ners of other properties must be made to share the burden of implementin land reform must be

re0ected. $here is a substantial distinction bet!een these t!o classes of o!ners that is clearly visible

e=cept to those !ho !ill not see. $here is no need to elaborate on this matter. In any event, the Conress

is allo!ed a !ide lee!ay in providin for a valid classification. Its decision is accorded reconition andrespect by the courts of 0ustice e=cept only !here its discretion is abused to the detriment of the Bill of 

Rihts.

It is !orth remar"in at this 0uncture that a statute may be sustained under the police po!er only if there is

a concurrence of the la!ful sub0ect and the la!ful method. Put other!ise, the interests of the public

enerally as distinuished from those of a particular class re3uire the interference of the 2tate and, no

less important, the means employed are reasonably necessary for the attainment of the purpose souht

to be achieved and not unduly oppressive upon individuals. &4  As the sub0ect and purpose of ararian

reform have been laid do!n by the Constitution itself, !e may say that the first re3uirement has been

satisfied. hat remains to be e=amined is the validity of the method employed to achieve the

constitutional oal.

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But for all its primacy and urency, the po!er of e=propriation is by no means absolute >as indeed no

po!er is absolute?. $he limitation is found in the constitutional in0unction that )private property shall not be

ta"en for public use !ithout 0ust compensation) and in the abundant 0urisprudence that has evolved from

the interpretation of this principle. Basically, the re3uirements for a proper e=ercise of the po!er are7 >?

public use and >;? 0ust compensation.

*et us dispose first of the arument raised by the petitioners in (.R. No. 1-@ that the 2tate should first

distribute public aricultural lands in the pursuit of ararian reform instead of immediately disturbin

property rihts by forcibly ac3uirin private aricultural lands. Parenthetically, it is not correct to say that

only public aricultural lands may be covered by the CARP as the Constitution calls for )the 0ust

distribution of all aricultural lands.) In any event, the decision to redistribute private aricultural lands in

the manner prescribed by the CARP !as made by the leislative and e=ecutive departments in the

e=ercise of their discretion. e are not 0ustified in revie!in that discretion in the absence of a clear 

sho!in that it has been abused.

 A becomin courtesy admonishes us to respect the decisions of the political departments !hen they

decide !hat is "no!n as the political 3uestion. As e=plained by Chief 6ustice Concepcion in the case of 

$a-ada v. Cuenco7&

 

$he term )political 3uestion) connotes !hat it means in ordinary parlance, namely, a

3uestion of policy. It refers to )those 3uestions !hich, under the Constitution, are to be

decided by the people in their soverein capacityD or in reard to !hich full discretionary

authority has been deleated to the leislative or e=ecutive branch of the overnment.) It

is concerned !ith issues dependent upon the !isdom, not leality, of a particular 

measure.

It is true that the concept of the political 3uestion has been constricted !ith the enlarement of 0udicial

po!er, !hich no! includes the authority of the courts )to determine !hether or not there has been a

rave abuse of discretion amountin to lac" or e=cess of 0urisdiction on the part of any branch or 

instrumentality of the (overnment.) &7 Even so, this should not be construed as a license for us to reverse

the other departments simply because their vie!s may not coincide !ith ours.

$he leislature and the e=ecutive have been seen fit, in their !isdom, to include in the CARP the

redistribution of private landholdins >even as the distribution of public aricultural lands is first provided

for, !hile also continuin apace under the Public *and Act and other conate la!s?. $he Court sees no

 0ustification to interpose its authority, !hich !e may assert only if !e believe that the political decision is

not un!ise, but illeal. e do not find it to be so.

In .*. v. Chandler/Dunbar )ater Po+er Co&"any , &8 it !as held7

Conress havin determined, as it did by the Act of March ,-@- that the entire 2t.Mary%s river bet!een the American ban" and the international line, as !ell as all of the

upland north of the present ship canal, throuhout its entire lenth, !as )necessary for 

the purpose of naviation of said !aters, and the !aters connected there!ith,) that

determination is conclusive in condemnation proceedins instituted by the Hnited 2tates

under that Act, and there is no room for 0udicial revie! of the 0udment of Conress ... .

 As earlier observed, the re3uirement for public use has already been settled for us by the Constitution

itself No less than the -41 Charter calls for ararian reform, !hich is the reason !hy private aricultural

lands are to be ta"en from their o!ners, sub0ect to the prescribed ma=imum retention limits. $he purposes

specified in P.:. No. ;1, Proc. No. and R.A. No. 99/1 are only an elaboration of the constitutional

in0unction that the 2tate adopt the necessary measures )to encourae and underta"e the 0ust distribution

of all aricultural lands to enable farmers !ho are landless to o!n directly or collectively the lands they

till.) $hat public use, as pronounced by the fundamental la! itself, must be bindin on us.

$he second re3uirement, i.e., the payment of 0ust compensation, needs a loner and more thouhtful

e=amination.

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6ust compensation is defined as the full and fair e3uivalent of the property ta"en from its o!ner by the

e=propriator. &9 It has been repeatedly stressed by this Court that the measure is not the ta"er%s ain but

the o!ner%s loss. 4' $he !ord )0ust) is used to intensify the meanin of the !ord )compensation) to convey

the idea that the e3uivalent to be rendered for the property to be ta"en shall be real, substantial, full,

ample. 41

It bears repeatin that the measures challened in these petitions contemplate more than a mere

reulation of the use of private lands under the police po!er. e deal here !ith an actual ta"in of private

aricultural lands that has dispossessed the o!ners of their property and deprived them of all its

beneficial use and en0oyment, to entitle them to the 0ust compensation mandated by the Constitution.

 As held in !e"ublic o the Phili""ines v. Castellvi , 42 there is compensable ta"in !hen the follo!in

conditions concur7 >? the e=propriator must enter a private propertyD >;? the entry must be for more than a

momentary periodD >? the entry must be under !arrant or color of leal authorityD >8? the property must be

devoted to public use or other!ise informally appropriated or in0uriously affectedD and >/? the utili&ation of 

the property for public use must be in such a !ay as to oust the o!ner and deprive him of beneficial

en0oyment of the property. All these re3uisites are envisioned in the measures before us.

here the 2tate itself is the e=propriator, it is not necessary for it to ma"e a deposit upon its ta"in

possession of the condemned property, as )the compensation is a public chare, the ood faith of the

public is pleded for its payment, and all the resources of ta=ation may be employed in raisin the

amount.) 4& Nevertheless, 2ection 9>e? of the CARP *a! provides that7

Hpon receipt by the lando!ner of the correspondin payment or, in case of re0ection or 

no response from the lando!ner, upon the deposit !ith an accessible ban" desinated by

the :AR of the compensation in cash or in *BP bonds in accordance !ith this Act, the

:AR shall ta"e immediate possession of the land and shall re3uest the proper Reister of 

:eeds to issue a $ransfer Certificate of $itle >$C$? in the name of the Republic of the

Philippines. $he :AR shall thereafter proceed !ith the redistribution of the land to the

3ualified beneficiaries.

d?, !hich provides that in case of the re0ection or disreard by the o!ner of the offer of the

overnment to buy his land+

... the :AR shall conduct summary administrative proceedins to determine the

compensation for the land by re3uirin the lando!ner, the *BP and other interested

parties to submit evidence as to the 0ust compensation for the land, !ithin fifteen >/?

days from the receipt of the notice. After the e=piration of the above period, the matter is

deemed submitted for decision. $he :AR shall decide the case !ithin thirty >@? daysafter it is submitted for decision.

$o be sure, the determination of 0ust compensation is a function addressed to the courts of 0ustice and

may not be usurped by any other branch or official of the overnment. EPZA v. Dulay   44  resolved a

challene to several decrees promulated by President Marcos providin that the 0ust compensation for 

property under e=propriation should be either the assessment of the property by the overnment or the

s!orn valuation thereof by the o!ner, !hichever !as lo!er. In declarin these decrees unconstitutional,

the Court held throuh Mr. 6ustice #uo E. (utierre&, 6r.7

$he method of ascertainin 0ust compensation under the aforecited decrees constitutes

impermissible encroachment on 0udicial preroatives. It tends to render this Court inutile

in a matter !hich under this Constitution is reserved to it for final determination.

$hus, althouh in an e=propriation proceedin the court technically !ould still have the

po!er to determine the 0ust compensation for the property, follo!in the applicable

decrees, its tas" !ould be releated to simply statin the lo!er value of the property as

declared either by the o!ner or the assessor. As a necessary conse3uence, it !ould be

useless for the court to appoint commissioners under Rule 91 of the Rules of Court.

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Moreover, the need to satisfy the due process clause in the ta"in of private property is

seeminly fulfilled since it cannot be said that a 0udicial proceedin !as not had before

the actual ta"in. #o!ever, the strict application of the decrees durin the proceedins

!ould be nothin short of a mere formality or charade as the court has only to choose

bet!een the valuation of the o!ner and that of the assessor, and its choice is al!ays

limited to the lo!er of the t!o. $he court cannot e=ercise its discretion or independence in

determinin !hat is 0ust or fair. Even a rade school pupil could substitute for the 0ude

insofar as the determination of constitutional 0ust compensation is concerned.

= = =

In the present petition, !e are once aain confronted !ith the same 3uestion of !hether 

the courts under P.:. No. /, !hich contains the same provision on 0ust compensation

as its predecessor decrees, still have the po!er and authority to determine 0ust

compensation, independent of !hat is stated by the decree and to this effect, to appoint

commissioners for such purpose.

$his time, !e ans!er in the affirmative.

= = =

It is violative of due process to deny the o!ner the opportunity to prove that the valuation

in the ta= documents is unfair or !ron. And it is repulsive to the basic concepts of 0ustice

and fairness to allo! the hapha&ard !or" of a minor bureaucrat or cler" to absolutely

prevail over the 0udment of a court promulated only after e=pert commissioners have

actually vie!ed the property, after evidence and aruments pro and con have been

presented, and after all factors and considerations essential to a fair and 0ust

determination have been 0udiciously evaluated.

 A readin of the aforecited 2ection 9>d? !ill readily sho! that it does not suffer from the arbitrariness that

rendered the challened decrees constitutionally ob0ectionable. Althouh the proceedins are described

as summary, the lando!ner and other interested parties are nevertheless allo!ed an opportunity to

submit evidence on the real value of the property. But more importantly, the determination of the 0ust

compensation by the :AR is not by any means final and conclusive upon the lando!ner or any other 

interested party, for 2ection 9>f? clearly provides7

 Any party !ho disarees !ith the decision may brin the matter to the court of proper 

 0urisdiction for final determination of 0ust compensation.

$he determination made by the :AR is only preliminary unless accepted by all parties concerned.

? Cash payment, under the follo!in terms and conditions7

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>a? 'or lands above fifty >/@? hectares, insofar as the

e=cess hectarae is concerned G $!enty+five percent

>;/? cash, the balance to be paid in overnment

financial instruments neotiable at any time.

>b? 'or lands above t!enty+four >;8? hectares and up to

fifty >/@? hectares G $hirty percent >@? cash, the

balance to be paid in overnment financial instruments

neotiable at any time.

>c? 'or lands t!enty+four >;8? hectares and belo! G

$hirty+five percent >/? cash, the balance to be paid in

overnment financial instruments neotiable at any time.

>;? 2hares of stoc" in overnment+o!ned or controlled corporations, *BP preferred

shares, physical assets or other 3ualified investments in accordance !ith uidelines set

by the PARCD

>? $a= credits !hich can be used aainst any ta= liabilityD

>8? *BP bonds, !hich shall have the follo!in features7

>a? Mar"et interest rates alined !ith -+day treasury bill

rates. $en percent >@? of the face value of the bonds

shall mature every year from the date of issuance until

the tenth >@th? year7 Provided, $hat should the

lando!ner choose to foreo the cash portion, !hether in

full or in part, he shall be paid correspondinly in *BP

bondsD

>b? $ransferability and neotiability. 2uch *BP bonds

may be used by the lando!ner, his successors+in+

interest or his assins, up to the amount of their face

value, for any of the follo!in7

>i? Ac3uisition of land or other real properties of the

overnment, includin assets under the Asset

Privati&ation Proram and other assets foreclosed by

overnment financial institutions in the same province or 

reion !here the lands for !hich the bonds !ere paid

are situatedD

>ii? Ac3uisition of shares of stoc" of overnment+o!ned

or controlled corporations or shares of stoc" o!ned by

the overnment in private corporationsD

>iii? 2ubstitution for surety or bail bonds for the

provisional release of accused persons, or for 

performance bondsD

>iv? 2ecurity for loans !ith any overnment financial

institution, provided the proceeds of the loans shall beinvested in an economic enterprise, preferably in a small

and medium+ scale industry, in the same province or 

reion as the land for !hich the bonds are paidD

>v? Payment for various ta=es and fees to overnment7

Provided, $hat the use of these bonds for these

purposes !ill be limited to a certain percentae of the

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outstandin balance of the financial instrumentsD

Provided, further, $hat the PARC shall determine the

percentaes mentioned aboveD

>vi? Payment for tuition fees of the immediate family of 

the oriinal bondholder in overnment universities,

collees, trade schools, and other institutionsD

>vii? Payment for fees of the immediate family of the

oriinal bondholder in overnment hospitalsD and

>viii? 2uch other uses as the PARC may from time to

time allo!.

$he contention of the petitioners in (.R. No. 1-111 is that the above provision is unconstitutional insofar 

as it re3uires the o!ners of the e=propriated properties to accept 0ust compensation therefor in less than

money, !hich is the only medium of payment allo!ed. In support of this contention, they cite

 0urisprudence holdin that7

$he fundamental rule in e=propriation matters is that the o!ner of the property

e=propriated is entitled to a 0ust compensation, !hich should be neither more nor less,

!henever it is possible to ma"e the assessment, than the money e3uivalent of said

property. 6ust compensation has al!ays been understood to be the 0ust and complete

e3uivalent of the loss !hich the o!ner of the thin e=propriated has to suffer by reason of 

the e=propriation . 4 >Emphasis supplied.?

In 6.M. $ua&on Co. v. *and $enure Administration, 4 this Court held7

It is !ell+settled that 0ust compensation means the e3uivalent for the value of the propertyat the time of its ta"in. Anythin beyond that is more, and anythin short of that is less,

than 0ust compensation. It means a fair and full e3uivalent for the loss sustained, !hich is

the measure of the indemnity, not !hatever ain !ould accrue to the e=propriatin entity.

$he mar"et value of the land ta"en is the 0ust compensation to !hich the o!ner of 

condemned property is entitled, the mar"et value bein that sum of money !hich a

person desirous, but not compelled to buy, and an o!ner, !illin, but not compelled to

sell, !ould aree on as a price to be iven and received for such property. >Emphasis

supplied.?

In the Hnited 2tates, !here much of our 0urisprudence on the sub0ect has been derived, the !eiht of 

authority is also to the effect that 0ust compensation for property e=propriated is payable only in money

and not other!ise. $hus G

$he medium of payment of compensation is ready money or cash. $he condemnor 

cannot compel the o!ner to accept anythin but money, nor can the o!ner compel or 

re3uire the condemnor to pay him on any other basis than the value of the property in

money at the time and in the manner prescribed by the Constitution and the statutes.

hen the po!er of eminent domain is resorted to, there must be a standard medium of 

payment, bindin upon both parties, and the la! has fi=ed that standard as money in

cash. 47 >Emphasis supplied.?

Part cash and deferred payments are not and cannot, in the nature of thins, be rearded

as a reliable and constant standard of compensation.

48

)6ust compensation) for property ta"en by condemnation means a fair e3uivalent in

money, !hich must be paid at least !ithin a reasonable time after the ta"in, and it is not

!ithin the po!er of the *eislature to substitute for such payment future obliations,

bonds, or other valuable advantae. 49 >Emphasis supplied.?

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It cannot be denied from these cases that the traditional medium for the payment of 0ust compensation is

money and no other. And so, conformably, has 0ust compensation been paid in the past solely in that

medium. #o!ever, !e do not deal here !ith the traditional e=cercise of the po!er of eminent domain.

$his is not an ordinary e=propriation !here only a specific property of relatively limited area is souht to

be ta"en by the 2tate from its o!ner for a specific and perhaps local purpose.

hat !e deal !ith here is a revolutionary "ind of e=propriation.

$he e=propriation before us affects all private aricultural lands !henever found and of !hatever "ind as

lon as they are in e=cess of the ma=imum retention limits allo!ed their o!ners. $his "ind of e=propriation

is intended for the benefit not only of a particular community or of a small sement of the population but of 

the entire 'ilipino nation, from all levels of our society, from the impoverished farmer to the land+lutted

o!ner. Its purpose does not cover only the !hole territory of this country but oes beyond in time to the

foreseeable future, !hich it hopes to secure and edify !ith the vision and the sacrifice of the present

eneration of 'ilipinos. (enerations yet to come are as involved in this proram as !e are today, althouh

hopefully only as beneficiaries of a richer and more fulfillin life !e !ill uarantee to them tomorro!

throuh our thouhtfulness today. And, finally, let it not be forotten that it is no less than the Constitution

itself that has ordained this revolution in the farms, callin for )a 0ust distribution) amon the farmers of lands that have heretofore been the prison of their dreams but can no! become the "ey at least to their 

deliverance.

2uch a proram !ill involve not mere millions of pesos. $he cost !ill be tremendous. Considerin the vast

areas of land sub0ect to e=propriation under the la!s before us, !e estimate that hundreds of billions of 

pesos !ill be needed, far more indeed than the amount of P/@ billion initially appropriated, !hich is

already staerin as it is by our present standards. 2uch amount is in fact not even fully available at this

time.

e assume that the framers of the Constitution !ere a!are of this difficulty !hen they called for ararian

reform as a top priority pro0ect of the overnment. It is a part of this assumption that !hen they envisioned

the e=propriation that !ould be needed, they also intended that the 0ust compensation !ould have to be

paid not in the orthodo= !ay but a less conventional if more practical method. $here can be no doubt that

they !ere a!are of the financial limitations of the overnment and had no illusions that there !ould be

enouh money to pay in cash and in full for the lands they !anted to be distributed amon the farmers.

e may therefore assume that their intention !as to allo! such manner of payment as is no! provided

for by the CARP *a!, particularly the payment of the balance >if the o!ner cannot be paid fully !ith

money?, or indeed of the entire amount of the 0ust compensation, !ith other thins of value. e may also

suppose that !hat they had in mind !as a similar scheme of payment as that prescribed in P.:. No. ;1,

!hich !as the la! in force at the time they deliberated on the ne! Charter and !ith !hich they

presumably areed in principle.

$he Court has not found in the records of the Constitutional Commission any cateorical areementamon the members reardin the meanin to be iven the concept of 0ust compensation as applied to

the comprehensive ararian reform proram bein contemplated. $here !as the suestion to )fine tune)

the re3uirement to suit the demands of the pro0ect even as it !as also felt that they should )leave it to

Conress) to determine ho! payment should be made to the lando!ner and reimbursement re3uired

from the farmer+beneficiaries. 2uch innovations as )proressive compensation) and )2tate+subsidi&ed

compensation) !ere also proposed. In the end, ho!ever, no special definition of the 0ust compensation for 

the lands to be e=propriated !as reached by the Commission. ' 

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of ararian reform achieved at last after the frustrations and deprivations of our peasant masses durin all

these disappointin decades. e are a!are that invalidation of the said section !ill result in the

nullification of the entire proram, "illin the farmer%s hopes even as they approach reali&ation and

resurrectin the spectre of discontent and dissent in the restless countryside. $hat is not in our vie! the

intention of the Constitution, and that is not !hat !e shall decree today.

 Acceptin the theory that payment of the 0ust compensation is not al!ays re3uired to be made fully in

money, !e find further that the proportion of cash payment to the other thins of value constitutin the

total payment, as determined on the basis of the areas of the lands e=propriated, is not unduly oppressive

upon the lando!ner. It is noted that the smaller the land, the bier the payment in money, primarily

because the small lando!ner !ill be needin it more than the bi lando!ners, !ho can afford a bier 

balance in bonds and other thins of value. No less importantly, the overnment financial instruments

ma"in up the balance of the payment are )neotiable at any time.) $he other modes, !hich are li"e!ise

available to the lando!ner at his option, are also not unreasonable because payment is made in shares of 

stoc", *BP bonds, other properties or assets, ta= credits, and other thins of value e3uivalent to the

amount of 0ust compensation.

 Admittedly, the compensation contemplated in the la! !ill cause the lando!ners, bi and small, not a littleinconvenience. As already remar"ed, this cannot be avoided. Nevertheless, it is devoutly hoped that

these countrymen of ours, conscious as !e "no! they are of the need for their forebearance and even

sacrifice, !ill not berude us their indispensable share in the attainment of the ideal of ararian reform.

Emphasis supplied.?

In Jennedy v. Indianapolis, & the H2 2upreme Court cited several cases holdin that title to property does

not pass to the condemnor until 0ust compensation had actually been made. In fact, the decisions appear 

to be uniformly to this effect. As early as 44, in !ubotto& v. Mc%ure, 4 it !as held that )actual payment

to the o!ner of the condemned property !as a condition precedent to the investment of the title to the

property in the 2tate) albeit )not to the appropriation of it to public use.) In  !e0ord v. 1ni(ht,  the Court

of Appeals of Ne! or" said that the construction upon the statutes !as that the fee did not vest in the

2tate until the payment of the compensation althouh the authority to enter upon and appropriate the land

!as complete prior to the payment. Jennedy further said that )both on principle and authority the rule is ...

that the riht to enter on and use the property is complete, as soon as the property is actually

appropriated under the authority of la! for a public use, but that the title does not "ass ro& the o+ner 

+ithout his consent, until 2ust co&"ensation has been &ade to hi&.3  

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e=amined and rehoned, that they may be sharper instruments for the better protection of the farmer%s

rihts. But !e have to start some!here. In the pursuit of ararian reform, !e do not tread on familiar 

round but rope on terrain frauht !ith pitfalls and e=pected difficulties. $his is inevitable. $he CARP

*a! is not a tried and tested pro0ect.