Eminent domain is the power of the State to take private property for public use

Eminent domain is the power of the State to take private property for public use.³ It is an inherent power of State as it is a power necessary for the State’s existence; it is a power the State cannot do without.⁴ As an inherent power, it does not need at all to be embodied in the Constitution; if it is mentioned at all, it is solely for purposes of limiting what is otherwise an unlimited power. The limitation is found in the Bill of Rights⁵ – that part of the Constitution whose provisions all aim at the protection of individuals against the excessive exercise of governmental powers.

Section 9, Article III of the 1987 Constitution (which reads "No private property shall be taken for public use without just compensation.") provides two essential limitations to the power of eminent domain, namely, that (1) the purpose of taking must be for public use and (2) just compensation must be given to the owner of the private property.

It is not accidental that Section 9 specifies that compensation should be "just" as the safeguard is there to ensure a balance – property is not to be taken for public use at the expense of private interests; the public, through the State, must balance the injury that the taking of property causes through compensation for what is taken, value for value.

Nor is it accidental that the Bill of Rights is interpreted liberally in favor of the individual and strictly against the government. The protection of the individual is the reason for the Bill of Rights’ being; to keep the exercise of the powers of government within reasonable bounds is what it seeks.⁶

The concept of "just compensation" is not new to Philippine constitutional law,⁷ but is not original to the Philippines; it is a transplant from the American Constitution.⁸ It found fertile application in this country particularly in the area of agrarian reform where the taking of private property for distribution to landless farmers has been equated to the "public use" that the Constitution requires. In Land Bank of the Philippines v. Orilla,⁹ a valuation case under our agrarian reform law, this Court had occasion to state:

Constitutionally, "just compensation" is the sum equivalent to the market value of the property, broadly described as the price fixed by the seller in open market in the usual and ordinary course of legal action and competition, or the fair value of the property as between the one who receives and the one who desires to sell, it being fixed at the time of the actual taking by the government. Just compensation is defined as the full and fair equivalent of the property taken from its owner by the expropriator. It has been repeatedly stressed by this Court that the true measure is not the taker's gain but the owner's loss. The word "just" is used to modify the meaning of the word "compensation" to convey the idea that the equivalent to be given for the property to be taken shall be real, substantial, full and ample.¹⁰ [Emphasis supplied.]

EN BANC

G.R. No. 164195               October 12, 2010

APO FRUITS CORPORATION and HIJO PLANTATION, INC., Petitioners,
vs.
LAND BANK OF THE PHILIPPINES, Respondent.