Provincial Government of Rizal v. Caro de Araullo etc. Eminent Domain- Value to be paid.

In the old case of Provincial Government of Rizal v. Caro de Araullo, it was ruled that “x x x the owners of the land have no right to recover damages for this unearned increment resulting from the construction of the public improvement (lengthening of Taft Avenue from Manila to Pasay) from which the land was taken. To permit them to do so would be to them to recover more than the value of the land at the time it was taken, which is the true measure of the damages, or just compensation, and would discourage the construction of important public improvements.”

    In subsequent cases, the Court, following the above doctrine, invariably held that the time of taking is the critical date in determining lawful or just compensation. In Municipality of La Carlota v. The Spouses Felicidad Baltazar and Vicente Gan, it was ruled that the owner, as is the constitutional intent, is paid what he is entitled to according to the value of the property so devoted to public use as of the date of taking. From that time, he had been deprived thereof. He had no choice but to submit. He is not, however, to be despoiled of such a right. No less than the fundamental law guarantees just compensation. It would be injustice to him certainly if from such a period, he could not recover the value of what was lost. There could be on the other hand, injustice to the expropriator if by a delay in the collection, the increment in price would accrue to the owner. The doctrine to which the Court has been committed is intended precisely to avoid either contingency fraught with unfairness. (NPC v. Ibrahim, et al., G.R. No. 168732, June 29, 2007).

    Simply stated, the exception finds the application where the owner would be given undue increment advantages arising from the use to which the government devotes the property expropriated – as for instance, the extension of a main thoroughfare as was in the case in Caro de Araullo. In the instant case, however, it is difficult to conceive of how there could have been an extra-ordinary increase in the value of the owner’s land arising from the expropriation, as indeed the records do not show any evidence that the valuation of P1,000.00 reached in 1992 was due to increments directly caused by petitioner’s use of the land. Since the petitioner is claiming an exception to Rule 67, Section 4, it has the burden in proving its claim that its occupancy and use – not ordinary inflation and increase in land values – was the direct cause of the increase in valuation from 1978 to 1992. (NPC v. Ibrahim, et al., G.R. No. 168732, June 29, 2007).