Republic of the Philippines

CENTRAL BOARD OF ASSESSMENT APPEALS M a n i l a

THE CITY ASSESSOR OF QUEZON CITY, Respondent-Appellant,

– versus –

THE BOARD OF ASSESSMENT APPEALS OF QUEZON CITY,
Appellee,

CBAA Case No. L-09 Re: Tax Declaration Nos. C-126-02102-C
C-126-02103-C Quezon City

– and –

ROBINSON’S LAND CORPORATION, Petitioner-Appellee,
x – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – x

R E S O L U T I O N

Sometime on September 11, 1991, Petitioner-Appellee, Robinson’s Land

Corporation, for the first time received a Statement of Delinquency and Demand

for payment of real property taxes on its real properties consisting of buildings

(shopping malls) covered by Tax Declaration No. C-126-02102-C, in the total

amount of P5,442,440.76, representing real property taxes thereof for the year

1991, together with a photocopy of the owner’s copy of the aforementioned tax

declaration, covering real property consisting of a building (shopping mall)

located at the corner of EDSA and Ortigas Avenue, Ugong Norte, Quezon City

which assessed said property at P403,143,760.00, effective 1991. Petitioner-

Appellee alleges that there was no Notice of Assessment attached to the said

Statement, neither had they received any such Notice.

Upon receipt of the above Statement of Delinquency, on October 22,

1991, Petitioner-Appellee, sought an administrative relief from Respondent-

Appellant, on the ground that the assessment under Tax Declaration No. C-

126-02102-C, is excessive and without legal basis and further requested that

aforesaid tax declaration be cancelled and a new tax declaration be issued

opting the old Schedule of Base Unit Construction Cost for Buildings for 1981-

84 general revision. No action was taken by Respondent-Appellant, thus

Reference: Book VIII, pp. 95-106

Petitioner-Appellee on October 30, 1991 filed an Appeal with the Appellee Local

Board. While the Appeal was still pending with the Appellee Local Board

Petitioner-Appellee, on December 12, 1991, received another letter from

Respondent-Appellant, together with a Notice of Assessment and the owner’s

copy of Tax Declaration No. C-126-2103-C, increasing the assessments of the

said building (shopping malls) from P403,143,760 to P538,649,920.00, real

property taxes to commence with the year 1992. It appears that both tax

declarations cover the same building. The increase in the assessment was due

to the additional area completed and occupied and the introduction of additional

auxiliary improvements on the existing building (shopping malls) under Tax

Declaration No. C-136-02102-C.

Again by virtue of such increase Petitioner-Appellee filed another appeal

with Appellee Local Board, on the increased assessments of Respondent-

Appellant, under TD No. C-136-02102-C, with Appellee Local Board.

Treated as one appeal, the Appellee Local Board, in a hearing conducted

on March 18, 1992, decided upon agreement of the parties, that action on these

cases should be deferred in view of the Restraining Order by the Supreme

Court in G.R. No. 97618 (CBAA Case No. 261), entitled Ismael Mathay, Jr. –

versus- Hon. Victor Macalincag, et al., and that Appellee Local Board shall wait

for the Supreme Court decision on the above G.R. No. 97618 before it could

render its own decision on the appeal.

On February 24, 1993, the Central Board, rendered its decision on the

Ismael Mathay, Jr. case, supra, “declaring null and void”, and therefore

unenforceable the subject Schedule of Market Values for all classes of lands in

Quezon City, as prepared solely by Respondent-Appellant City Assessor, being

contrary to and in violation of Section 9 of P.D. 921. On the basis of the Ismael

Mathay, Jr. case decision of this Board, Appellee Local Board, on July 22,

1993, declared that Tax Declaration No. C-126-02102-C and C-126-02103-C

are likewise void and, therefore, unenforceable, and directed Respondent-

Reference: Book VIII, pp. 95-106

Appellant to prepare a new assessment of the questioned property, based on

the Schedule of Market Values existing prior to the schedule voided by this

Board in the Ismael Mathay, Jr. case which was affirmed by the Supreme Court

(see SC Resolution on G.R. No. 97618, dated December 16, 1993).

A motion for reconsideration was filed by Respondent-Appellant on the

decision of Appellee Local Board, but the same was denied. Hence, the

elevation of the case, on appeal, before this Board.

This Board heard the case and rendered its decision, the dispositive

portion of which is as follows:

“WHEREFORE, premises considered, the decision of the Board of Assessment Appeals of Quezon City declaring the Schedule of Base Unit Construction Costs or Schedule of Market Values for all classes of buildings in Quezon City as null and void is hereby AFFIRMED. However, its order directing Respondent-Appellant to issue a new tax declaration base on the Schedule of Market Values for buildings (1981-1984) prior to the Schedule of Market Values of 1991, declared void by this Board is hereby MODIFIED, to the effect that Respondent-Appellant City Assessor is hereby ordered to reassess subject properties pursuant to Sections 5, 22 and 24 of PD 464 as amended.”

In affirming the decision of Appellee Local Board this Board postulated:

“Granting en arguendo, that the decision of this Board in the Mathay case includes that of the Schedule of Base Unit Construction Cost of Buildings, it cannot be denied that the said Schedule of Base Unit Construction Cost for Buildings prepared solely and adopted by Respondent-Appellant, suffered the same infirmities and irregularities in its preparation as that of the Schedule of Market Values for all classes of lands in Quezon City, which was declared null and void in our decision. This Board, therefore, under the principle of ‘stare decisis’ so declares on its own and on the basis of the evidences and merits of this Appeal, that the Schedule of Market Values (Schedule of Base Unit Construction Cost) for all classes of buildings in Quezon City is null and void, and therefore unenforceable, as prepared solely by Respondent-Appellant, City Assessor of Quezon City, being contrary to and in violation of Section 9, PD 921.”

In modifying the order of the Board below, this Board declared:

“As regards assessments of newly constructed buildings, Sections 3 and 4 of Assessment Regulations No. 1-82, implemented Executive Order No. 812 which provide as follows:

‘Sec. 3. Basis for the Collection of 1983 and 1984 Taxes. – In view of the extension of the 1981-82 general revision of real property assessment to June 30, 1984, the real property taxes due for the years 1983 and 1984 shall be computed on the basis of the assessed values of real property determined according to the 1978 approved Schedules of Values, except the taxes due on new constructions and newly discovered properties, which shall be computed as provided for in the succeeding Sections.

Sec. 4. Assessment of Newly Constructed Buildings. – The initial assessment of newly constructed and finished buildings whose effectivity year pursuant to Section 24 of PD 464, is 1983 or 1984 shall be determined in accordance with the

Reference: Book VIII, pp. 95-106

1981-82 Schedule of Unit Construction Cost for buildings duly approved by the Ministry of Finance.’

“Section 2 of Executive Order No. 812, dated June 22, 1982, further provides as follows:

‘Sec. 2. Applicability of the 1981-82 Schedule of Market Values. – the Schedule of Market Values for lands and the Schedule of Unit Construction Cost for Buildings duly approved by the Minister of Finance, for the 1981-82 General Revision of real property assessments shall be applied as the basis for the said general revision of real property assessments, which as provided for in the Executive Order will take effect on January 1, 1985.’

“Thus with respect to assessment of newly constructed and finished buildings, its effectivity year pursuant to Section 24 P.D. 464, is 1983 or 1984, and the assessment shall be determined in accordance with the 1981-82 schedule, but not to buildings constructed and completed after 1985. In effect, therefore, there was not a Schedule of Market Values for buildings from 1985 to 1991 and in the absence of an approved schedule for buildings, Sections 5 and 22 of P.D. 464, shall be the basis of the assessor in the assessment of newly constructed buildings after 1985.

“Accordingly, subject buildings having been constructed and completed in 1990 and 1991, Section2 5 and 22 of P.D. 464 are applicable which are hereinbelow quoted, viz:

‘Sec. 5. Appraisal of Real Property. – All real property, whether taxable or exempt, shall be appraised at the current and fair market value prevailing in the locality where the property is situated.’

Sec. 22. Valuation of Real Property. – Upon the discovery of real property or during the general revision of property assessments as provided in Section twenty-one of this Code or at any time when requested by the person in whose name the property is declared, the provincial or city assessor or his authorized deputy shall make an appraisal and assessment in accordance with Section five hereof of the real property listed and described in the declaration irrespective of any previous assessment or taxpayer’s valuation thereon: Provided, however, that the assessment of real property shall not be increased oftener than once every three (3) years in the absence of new improvements increasing the value of said property or of any change in its use, except as otherwise provided in this Code.’

Pursuant to this Board’s foregoing decision, Petitioner-Appellee,

Robinson’s Land Corporation, submitted a Petition for Reconsideration, praying

“that the portion of the Decision of the Central Board of Assessment Appeals x

x x modifying the Decision of the Local Board of Assessment Appeals be set

aside and the Decision of the Local Board of Assessment Appeals x x x be

affirmed en toto”.

While this Board was in the process of deliberating and resolving the

Petition for Reconsideration, contending parties submitted a Compromise

Agreement together with a Joint Motion for Judgment on the Compromise

Reference: Book VIII, pp. 95-106

Agreement. Duly executed and acknowledged before Atty. Joseph B. Sia on

December 13, 1995 at Quezon City, said Compromise Agreement is

reproduced as follows:

“COMPROMISE AGREEMENT

KNOW ALL MEN BY THESE PRESENTS:

This Compromise Agreement is made, executed and entered into by and between:

ROBINSON’S LAND CORPORATION, a corporation duly organized and existing under and by virtue of the laws of the Philippines, with office address at 29th Floor Galleria Corporate Center, EDSA corner Ortigas Avenue, Quezon City, represented herein by its President, JAMES L. GO, hereinafter referred to as ‘FIRST PARTY’;

and

THE CITY ASSESSOR OF QUEZON CITY, MR. CONSTANTINO P. ROSAS and the Quezon City government, represented by the Honorable Quezon City Mayor, ISMAEL A. MATHAY, JR. hereinafter referred to as the ‘SECOND PARTY’.

WITNESSETH THAT:

WHEREAS, there is a legal dispute pending before the Central Board of Assessment Appeals entitled ‘City Assessor of Quezon City, Respondent-Appellant vs. Local Board of Assessment Appeals of Quezon City and Robinson’s Land Corporation, Appellee’ with CBAA Case No. AF-90, S-91 and AF-94, S-92.

WHEREAS, pursuant to Quezon City Ordinance No. SP-531, S-95, the Honorable City Mayor, ISMAEL A. MATHAY, JR., in behalf of the Quezon City Government is hereby authorized to enter into a Compromise Agreement with the FIRST PARTY to settle amicably the aforementioned tax assessment case.

WHEREAS, the Parties, for their mutual interest and benefit, have decided to settle the controversy amicably to terminate the case pending before the Central Board of Assessment Appeals.

NOW, THEREFORE, for and in consideration of the foregoing premises, herein parties agree to the following:

1. The real property tax for the FIRST PARTY’s property located at EDSA corner Ortigas Avenue, Quezon City covered by Tax Declaration Nos. C-126-02102-C and C-126-02103-C shall be computed at the maximum base unit amount of THREE THOUSAND FIVE HUNDRED PESOS (P3,500.00) per square meter. The SECOND PARTY has agreed to issue new tax declarations based on said amount, a copy each of which is attached hereto as Annexes ‘A’ and ‘B’ hereof.

2. Consequently, the total real property tax due for 1991 up to 1995 shall be SEVENTY TWO MILLION SIXTY FOUR THOUSAND TWO HUNDRED NINETY SIX AND 60/100 PESOS (P72,064,296.60), less the total amount paid by the FIRST PARTY in the amount of THIRTY SIX MILLION NINE HUNDRED THIRTY SIX THOUSAND FIFTY FIVE & 75/100 PESOS (P36,936,055.75) and the discount for the 4th quarter of 1995 of THREE HUNDRED SEVENTY EIGHT THOUSAND SIX HUNDRED SEVENTEEN & 30/100 PESOS (P378,617.30) or the net tax due of THIRTY FOUR MILLION SEVEN HUNDRED FORTY NINE THOUSAND SIX HUNDRED TWENTY THREE & 55/100 PESOS (P34,749,623.55), without penalty, surcharge or interest.

Reference: Book VIII, pp. 95-106

3. By way of compromise, the FIRST PARTY has agreed to pay the TREASURER’S OFFICE OF QUEZON CITY the amount of THIRTY FOUR MILLION SEVEN HUNDRED FORTY NINE THOUSAND SIX HUNDRED TWENTY THREE & 55/100 PESOS (P34,749,623.55) which shall represent the net amount due for the real property tax payment from 1991 up to December 31, 1995. Such payment is, however, without prejudice to its rights to avail of the remedies to claim for a tax credit or refund of any overpaid taxes under existing laws.

4. Both parties agree to submit a copy of this Compromise Agreement for the approval of the Central Board of Assessment Appeals.

5. This Agreement embodies all the terms and conditions for the complete settlement of the aforementioned case and the same shall bind their successors-in-interest, agents and assigns.

IN WITNESS WHEREOF, we have hereunto set our hands this 13th day of December, 1995 at Quezon City.

QUEZON CITY GOVERNMENT Second Party

ROBINSON’S LAND CORPORATION
First Party By:

(Sgd.) JAMES L. GO President

By:

(Sgd.) CONSTANTINO P. ROSAS City Assessor of Quezon City

(Sgd.) HONORABLE CITY MAYOR ISMAEL A. MATHAY, JR.

CONFORME:

(Sgd.) ALFREDO D. MERCADO Quezon City Treasurer

ATTESTED BY:

SIGNED SIGNED

After a close examination of the Compromise Agreement, this Board

finds the same to be in accordance with law, not contrary to public policy, public

order or good morals, fair and equitable.

WHEREFORE, the same Compromise Agreement is hereby approved.

Accordingly the modified order sought to be reconsidered is hereby revised to

conform to the provisions of the said Compromise Agreement.

SO ORDERED.

Manila, Philippines, April 12, 1996.

(Signed) MARGARITA G. MAGISTRADO
Chairman

Reference: Book VIII, pp. 95-106

(Signed) ELEANOR A. SANTOS
Member

_________________ Vacant

Reference: Book VIII, pp. 95-106