Dissension in the Court: October 2010

The following are decisions promulgated by the High Court in October 2010 where at least one Justice felt compelled to express his or her dissent from the decision penned by the ponente.

When is a case really final?  When can the High Court review a lower tribunal’s findings of fact? To some extent, each of the cases cited below deal with a long-standing rule and its’ exceptions that are, at the end of the day, really very broad.  The wide expanse of these exceptions is a fertile ground upon which Justices may disagree.  So with this background, and in the wake of the forthcoming Pacquiao-Margarito bout, it is timely to once again declare, “Let’s get ready to rumble!

1.            Interest and Immutability (Brion v. Bersamin)

The decision and dissent in the case of Apo Fruits Corporation and Hijo Plantation, Inc. vs. Land Bank of the Philippines promulgated on October 12, 2010 essentially involved a divergence of positions on: (a) the conditions in which a 12% legal interest may be imposed in the payment of just compensation, and (b) the principle of immutability of judgments.

A.   Legal Interest

In the main decision, Justice Arturo D. Brion ruled that the obligation of the State to make just compensation payments effectively constitutes a forbearance on the part of Government upon which interest should become due.

According to the ponente, “[a]part from the requirement that compensation for expropriated land must be fair and reasonable, compensation, to be ‘just,’ must also be made without delay. Without prompt payment, compensation cannot be considered ‘just’ if the property is immediately taken as the property owner suffers the immediate deprivation of both his land and its fruits or income.”

Justice Brion added: “[t]his is the principle at the core of the present case where the petitioners were made to wait for more than a decade after the taking of their property before they actually received the full amount of the principal of the just compensation due them. What they have not received to date is the income of their landholdings corresponding to what they would have received had no uncompensated taking of these lands been immediately made. This income, in terms of the interest on the unpaid principal, is the subject of the current litigation.”

Accordingly, Justice Brion finds that in the instant case, when the Land Bank of the Philippines (LBP) took the petitioners’ lands without the corresponding full payment, LBP became liable for the income the landholdings would have earned had they not immediately been taken from Apo Fruits Corporation and Hijo Plantation, Inc. (the “Petitioners”).

For the majority then, in just compensation cases, the unpaid amount of just compensation should earn interest at the legal rate of 12% per annum from the date the properties are taken up to the time of full payment.

In turn, the sole dissenter, Justice Lucas P. Bersamin, asserts that the legal interest  of 12% per annum should be deemed as a form of damages which, according to the Civil Code and certain existing jurisprudence, should be imposable only where there is delay in the payment of just compensation.  Citing an earlier case of Land Bank of the Philippines v. Wycoco, Justice Bersamin pointed out that the Supreme Court has “held that the interest of 12% per annum on the just compensation is due the landowner in case of delay in payment, which will in effect make the obligation on the part of the government one of forbearance. On the other hand, interest in the form of damages cannot be applied, where there was prompt and valid payment of just compensation.”  In these cases, the delay should be sufficiently established.

Since, according to the dissenter, LBP had paid a portion of the just compensation promptly after the valuation had been handed down by the Department of Agrarian Reform (which amounts the Petitioners also promptly withdrew), LBP could not be said to have been in delay.  Any subsequent recourse by LBP to the courts on the issue of just compensation cannot be construed as unjustified delay on its part considering that assailing an erroneous order before a higher court is a remedy afforded by law to every losing party.

B.  Immutability of Judgments

The October 12, 2010 decision of the Supreme Court en banc stemmed from a motion filed by the Petitioners for the High Court to entertain a second motion for reconsideration (with a motion to refer the same to the Court en banc) which motion was filed slightly less than 2 weeks after an Entry of Judgment had already been given on the case.  Expectedly, LBP protested that the decision in the case had already attained finality and that the principles of immutability of judgments should restrict the Court from entertaining the second motion for reconsideration.

Justice Bersamin justified the en banc’s giving of due course to the second motion for reconsideration on the grounds that there are recognized exceptions to the immutability of judgments principle, which principle states that “a final judgment may no longer be altered, amended or modified, even if the alteration, amendment or modification is meant to correct what is perceived to be an erroneous conclusion of fact or law and regardless of what court, be it the highest Court of the land, rendered it.”

The majority decision quoted from the 2004 case of Barnes v. Padilla (482 Phil. 903), which enumerated exceptions to the application of the rule on immutability of judgments:

However, this Court has relaxed this rule in order to serve substantial justice considering (a) matters of life, liberty, honor or property, (b) the existence of special or compelling circumstances, (c) the merits of the case, (d) a cause not entirely attributable to the fault or negligence of the party favored by the suspension of the rules, (e) a lack of any showing that the review sought is merely frivolous and dilatory, and (f) the other party will not be unjustly prejudiced thereby.

Contrary to the position of LBP that the instant case involved merely matter of private interest, Justice Bersamin believed that it actually posed issues of transcendental importance involving as it does, constitutional limitations on eminent domain and because the subject matter involved–agrarian reform—covers a societal objective that the government has unceasingly sought to achieve in the past half century.  Thus, the interests of substantial justice should prevail over a procedural rule concerning the finality of judgments.

On the issue of immutability, the dissent of Justice Brion concedes that there are indeed  exceptions such as: (a) the correction of clerical errors; (b) the nunc pro tunc entries that cause no prejudice to any party; (c) void judgments; and (d) whenever circumstances transpire after the finality of the decision rendering its execution unjust and inequitable.  However, Justice Brion does not believe that the case provides any basis to apply any of the exceptions.

As the dissenter concludes, he “cannot bring [himself] to agree that this case is impressed at all with public interest, involving as it does only a “private claim for interest and attorney’s fees which cannot even be classified as unprecedented,” which “does not qualify either as a substantial or transcendental matter, or as an issue of paramount public interest for no special or compelling circumstance was present to warrant the relaxation of the doctrine of immutability in favor of the petitioners.”

(Apo Fruits Corporation, et al. vs. Land Bank of the Philippines; G.R. No. 164195, October 12, 2010. See dissenting opinion here.)

(author’s note:  On the matter of legal interest, the author agrees in the principle espoused by the majority that the concept of “just” compensation should involve not just the amount of the payment but the timeliness in the payment of the full amount.  Otherwise, it would indeed be less than just.  On the immutability issue, this is again, to the author, one of those rules which allows of an exceedingly broad set of exceptions which can be applied anytime, anywhere (and thus the real exception would once again be, whenever the Supreme Court wants to).  Consider the following exceptions cited by the Supreme Court from the Barnes decision: (a) matters of life, liberty, honor or property, (b) the existence of special or compelling circumstances, (c) the merits of the case, (d) a cause not entirely attributable to the fault or negligence of the party favored by the suspension of the rules, (e) a lack of any showing that the review sought is merely frivolous and dilatory, and (f) the other party will not be unjustly prejudiced thereby.  Doesn’t this cover virtually every case brought before the Supreme Court?)

2.            An Arbitrary, Despotic and Hostile Comelec—A Rematch (Brion v. Velasco)

In Dissension in the Court: August 2010 posted in Lexoterica on September 6, 2010, the case of Abraham Kahlil B. Mitra vs. Commission on Elections, Antonio V. Gonzales and Orlando R. Balbon, Jr. in which Justice Arturo D. Brion was discussed.  In that decision, the majority held that the Commission on Elections (Comelec) gravely abused its discretion in its evaluation and appreciation of factual evidence.  On this basis, the Court ruled that the evidence on hand supported the fact that Abraham Mitra had sufficiently transferred his residence in Palawan from Puerto Princesa to Aborlan.

Justice Presbitero J. Velasco penned a dissenting opinion and noted that there was no grave abuse of discretion on the part of the Comelec that would justify the High Court’s substituting the Comelec’s factual findings with the Court’s own.

The Comelec, Antonio Gonzales and Orlando Balbon each asked the Supreme Court to reconsider that decision.

In the view expressed by the ponente, the motions for reconsideration consisted of mere rehashes of their previous submissions and raised the same arguments already resolved by the Court earlier.  Given that no new substantial points were raised, Justice Brion, for the majority, decided to deny such motions for reconsideration.  Even so, the majority proceeded to address the points raised “if only to put an end to lingering doubts on the correctness of [their] July 2, 2010 Decision.”

The succeeding discourse in the main decision then consisted essentially of pointing out why the Comelec gravely abused its discretion in the appreciation of the evidence presented to it.

Similarly, Justice Velasco reiterated the basis for his earlier dissent arguing that the Comelec did not gravely abuse its discretion in appreciating the factual evidence and asserted anew that the Court could not under those circumstances, supplant the Comelec’s factual findings with its own.

(Abraham Kahlil B. Mitra vs. Commission on Elections, Antonio vs. Gonzales and Orlando R. Balbon Jr.; G.R. No. 191938, October 19, 2010.  See dissenting opinion here.)

(author’s note:  After a couple of decades of law practice, this author remains somewhat confused about the limits to the High Court’s review of the factual findings of a lower tribunal.  Yes, he is well aware of the grave abuse of discretion exception—i.e., the abuse of discretion that must be “patent and gross as to amount to an evasion of a positive duty or a virtual refusal to perform a duty enjoined by law, or to act at all in contemplation of law, as where the power is exercised in an arbitrary and despotic manner by reason of passion and hostility.”  That’s quite a high standard for the grave abuse of discretion exception to kick in.  Still and all, it might just be a little bit more consistent, if honest, to formulate the exception in this manner: “when the Supreme Court wants to.”  That should make this author slightly less befuddled.  If the foregoing note sounds familiar to you, yes, it is the very same note of this author in his August 2010 posting.  Like the motions for reconsideration (according to the majority), the author’s note here is repetitive of what he has previously stated, in the same way that the majority decision and the dissent remained essentially unchanged.)