Republic of the Philippines

CENTRAL BOARD OF ASSESSMENT APPEALS Manila

C.C. UNSON COMPANY, INC., Petitioner-Appellant,

– versus –

THE LOCAL BOARD OF ASSESSMENT APPEALS OF CADIZ CITY,
Appellee,

– and –

CITY ASSESSOR OF CADIZ CITY, Respondent-Appellee.
x – – – – – – – – – – – – – – – – – – – – – – – – – x

CBAA CASE NO. V-06

In Re:

LBAA CASE No. 1 T.D. No. VARIOUS
City of Cadiz

D E C I S I O N

This is an Appeal taken by Petitioner-Appellant C.C. UNSON COMPANY,

INC. (hereinafter referred to as “UNSON”) assailing the Decision of the Local

Board of Assessment Appeals of Cadiz City dated August 25, 1993, the

dispositive portion of which reads as follows:

“IN VIEW OF THE FOREGOING CONSIDERATIONS, the Board hereby renders judgment dismissing the petition filed by petitioner against the respondents in the present action for lack of merit.”

It appears that UNSON bought seven (7) parcels of land situated in Cadiz

City in an auction sale conducted by the Office of the Sheriff of the Regional

Trial Court of Negros Occidental (Br. 60, Cadiz City) as shown by a “Certificate

of Sale” dated December 14, 1989 (pp. 41-43, Record):

1) Lot No. 1672-A-4, TCT No. T-7512, TD No. 12-672
2) Lot No. 1672-A-5, TCT No. T-7513, TD No. 12-673
3) Lot No. 1672-A-8, TCT No. T-7516, TD No. 12-777
4) Lot No. 1672-A-9, TCT No. T-7517, TD No. 12-778
5) Lot No. 1672-A-14, TCT No. T-7522, TD No. 12-753
6) Lot No. 1672-B-5, TCT No. T-7495, TD No. 12-370
7) Lot No. 1672-B-6, TCT No. T-7496, TD No. 12-371

UNSON, in a letter dated January 9, 1993 to the Respondent-Appellee

City Assessor of Cadiz City (pp. 44-45, Record), requested Respondent-

Appellee to reclassify subject lots from “industrial” to “agricultural” and

reiterated its previous request for copies of tax declarations on the same lots.

Reference: Book VII, pp. 253-267

Respondent-Appellee in a letter dated February 1, 1993 (pp. 46-47, Record),

informed Petitioner-Appellant that subject lots had just been reclassified as

agricultural to take effect in 1994 in accordance with Sec. 221 of the Local

Government Code, but denied the request for copies of tax declarations.

Another letter from UNSON dated February 24, 1993 (pp. 48-49, Record)

asked Respondent-Appellee for reconsideration and to reclassify the subject

properties from “industrial” to “agricultural” retroactive to the year 1979.

Respondent-Appellee, in his letter dated March 18, 1993 (pp. 50-51, Record),

denied such request for reconsideration. Not satisfied, UNSON filed its petition

for review with the Appellee Local Board on April 30, 1993.

The Local Board subsequently found for the Respondent-Appellee.

Hence, this appeal.

Petitioner-Appellant assigned the following errors:

1. The Local Board of Assessment Appeals erred in ruling that UNSON is not a real party in interest to question the reclassification of the subject lands from agricultural to industrial;

2. The Local Board of Assessment Appeals erred in not finding that the reclassification from agricultural to industrial is void; and

3. The Local Board of Assessment Appeals erred in sustaining the City Assessor of Cadiz City in not ordering the reclassification of the subject lands from industrial to agricultural and in not furnishing UNSON with the latest tax declarations.

Petitioner-Appellant prays this Board to set aside the decision assailed

from and to order Respondent-Appellee:

“1) to reclassify the subject parcels of land from industrial to agricultural retroactive to 1979 when subject lands were illegally reclassified from agricultural to industrial;

2) to direct the Assessor’s office to issue the tax declarations to UNSON from the date of the illegal classification to the latest revision; and

3) to issue new tax declarations on the basis of the reclassification from industrial to agricultural from 1979 to the latest revision.”

Anent the first ground, Petitioner-Appellant argue that “a real party in

interest is the party who will be benefited or injured by the judgment (Salonga

vs. Warner Barnes & Co. Ltd., 88 Phil 125); and that, in this case, “UNSON will

be benefited by the judgment if the reclassification will be granted and injured if

the request for reclassification will be denied.”

Reference: Book VII, pp. 253-267

The records show that Mr. Oscar Deferia mortgaged the subject parcels

of land consisting of 7,102 square meters, more or less, in favor of Petitioner-

Appellant per mortgage document dated January 26, 1980 for the amount of

P30,000.00 which document was registered on March 10, 1980 with the

Register of Deeds of Cadiz City (Local Board’s Decision, p. 60, Record).

UNSON bought the same parcels of land in an auction sale conducted by the

Office of the Sheriff of the Regional Trial Court of Negros Occidental (Br. 60,

Cadiz City) on December 14, 1989 (pp. 41-43, Record).

On the other hand, copies of the covering tax declarations (pp. 132-138)

show that all the said tax declarations were sworn to by Mr. Oscar Deferia when

the lots covered thereby were reclassified from “agricultural” to “industrial”: TD

No. 12-012 (Lot 1672-B-5) on January 31, 1979, TD No. 12-054 (Lot 1672-B-6)

on May 16, 1979. TD Nos. 12-672 (Lot 1672-A-4) and 12-673 Lot No. 1672-A-

5) on October 8, 1979. TD Nos. 12-777 (lot 1672-A-B), 12-778 (Lot 1672-A-9)

and 12-783 (Lot 1672-A-14) on January 8, 1980). The reclassifications for the

first two declarations were to take effect in 1979, and for the rest, in 1980.

Clearly, therefore, Petitioner-Appellant was not the owner of subject lots

at the time when they were reclassified in 1979 and 1980 from agricultural to

industrial.

Under P.D. 464 (Real Property Tax Code), the owner is the real party in

interest in an assessment appeal and the prescriptive period to question the

action of the assessor is within sixty (60) days from the date of receipt by him of

the written notice of assessment, viz:

“Sec. 30. Local Board of Assessment Appeals. – Any owner who is not satisfied with the action of the provincial or city assessor in the assessment of his property may, within sixty (60) days from the date of receipt by him of the written notice of assessment provided in this Code, appeal to the Board of Assessment Appeals of the Province or City, by filing with it a petition under oath using the form prescribed for the purpose, together with copies of the tax declarations and such affidavit or documents submitted in support of the appeal.”)

Moreover, the argument of Petitioner-Appellant that it is UNSON which

will be benefited by the judgment if the reclassification will be granted, and

Reference: Book VII, pp. 253-267

injured if the request for reclassification will be denied, is untenable. In City

Assessor of Bais City vs. BAA of Bais City and Central Azucarera de Bais, Inc.

(CBAA Case No. 246, September 10, 1990), this Board ruled as follows:

“It will be noted that Mr. Dionisio Cuison, the Appellant in this case, has no legal personality to appeal the decision of the Appellee Board of Assessment Appeal of Bais City, and such is not a real party in interest.

(For not being the Assessor at the time of the appeal.) Sec. 2, Rule 3 of the Revised Rules of Court provides:

“Sec. 2. Parties in interest – Every action must be prosecuted and defended in the name of the real party in interest.”

“Interpreting the said provision it has bee ruled that the real party in interest is the one who would be benefited or injured by the judgment or the party entitled to the avails of the suit (Salonga vs. Warner Barnes & Co., Ltd. G.R. No. L-2246, January 31, 1951). A corollary preposition to this rule is that actions must be brought by the real parties in interest and against the persons who are to be bound by the judgment obtained therein (Poblete vs. Court of First Instance of Cavite, 36 Phil. 556; Dequilla vs. Clodualog, CA-G.R. No. 17015-R February 28, 1958). The Respondent-Appellant, Mr. Dionisio Cuison, can no longer be bound by any judgment in this case, having been relieved by Mr. Julian M. Lopez as regular City Assessor of Bais City and who reassumed the duties and functions of the position on July 29, 1988. The Resolution on LBAA Case No. 29 was released y the Local Board on May 31, 1989.”

The realty taxes on the lots prior to 1990 were due not from Petitioner-

Appellant but from the previous owner, Mr. Oscar Deferia. As it turned out,

however, Mr. Deferia did not pay the realty taxes rightfully due from him.

Petitioner-Appellant, which may have slept on its right as mortgagee to compel

Mr. Deferia to fulfil his obligations as mortgagor of the subject lots, cannot now

be allowed to question the reassessments of said lots in 1979 and 1980 since

said reassessments or reclassifications, having become final and conclusive

long before Petitioner-Appellant became the owner of subject lots, having

binding effect on all persons having legal interest on the subject lots. Petitioner-

Appellant included. Thus, in Provincial Assessor of Bataan vs. BAA of Bataan

and Atlas Consolidated Mining and Development Corporation (CBAA Case No.

152) we held:

“There is no question that ACMDC has acquired title to and ownership of the property involved on February 13, 1979. However, ACMDC was not yet the owner at the time the provincial assessor of Bataan assessed subject property pursuant to P.D. 76. The declared owner then were the spouses Pacifico de Dios and Leonora Dominquez. For failure of said spouses to seasonably appeal the assessment, the same necessarily became final and conclusive. This was the status of the assessment when ACMDC acquired the ownership of subject property. As subject assessment already became final and conclusive long before ACMDC acquired ownership of subject property

Reference: Book VII, pp. 253-267

ACMDC would, as a natural consequence, be bound by said assessment. The binding effect of assessments and reassessments is provided for in Section 26 of P.D. 464 which states as follows:

“SEC. 26. Binding Effect of Assessment or Reassessment – All assessments and reassessments made under the provisions of this Code shall be valid and binding on all persons having legal interest on the property.”

“Furthermore, to grant every succeeding owner of the right to appeal a final and conclusive assessment upon assumption of ownership of the property involved would impair the stability of the assessment.”

On the second and third issues, Petitioner-Appellant argues that the

reclassifications of the subject lots in 1979 and 1980 from agricultural to

industrial were void for the reason that the same lots were never used as

industrial.

There is no question that the previous owners, Mr. Oscar Deferia, had

requested, or at least agreed to, the reclassifications made in 1979 and 1980.

As already stated, Petitioner-Appellant has no legal personality to question the

validity of such reclassifications to question the validity of such reclassifications

for not being the owner of subject lots at the time when said lots were so

reclassified. Besides, there is that prima facie presumption in favor of the

accuracy of the assessment. Even assuming, arguendo, that Petitioner-

Appellant has that legal personality to question the said reclassifications, it

(Petitioner-Appellant) failed to present competent and substantial evidence to

overcome the presumption in favor of the accuracy of the same reclassifications

made in 1979 and 1980. Thus:

“Moreover, there is the presumption juris tantum that official duty has been regularly performed (Rule 131, Sec. 5(m) Revised Rules of Court). This presumption in favor of the accuracy of the assessment ceases to exist the moment the property owner can rebut and present competent and substantial evidence to meet the prima facie case of accuracy (City Assessor of Pasay vs. BAA of Pasay and Floretino Cunanan, CBAA Case No. 37, January 21, 1975.” (Rodolfo H. Dulay vs. BAA and City Assessor of Naga City, CBAA Case No. 234, September 5, 1988.)

“The good faith of tax assessors and the validity of their actions are presumed. They will be presumed to have taken into consideration all the facts to which their attention was called (Alfred V. Sweet vs. Auburn, 104 ALR 784 {1935}; Sunday Lake Iron Co. vs. Wakefield Twp., 247 US 350 {1918} Pittsburg, C.C. & St. L.R. Co. vs. Backus, 154 US 421 {1893}; State ex rel. Nelson vs. Meek, 127 Ark. 349 {1917}. As a result of this presumption, when assessments are assailed, the burden of proof is upon the property owner, upon whom it is incumbent to show clearly that the assessment was erroneous (Amoskeng Savings Bank vs. Purdy, 231 US 373 {1913}; People ex rel. Burke vs. Wells, 184 NY 275 {1906} . . . Each case of valuation must be determined according to the conditions existing at the time and the property to be assessed

Reference: Book VII, pp. 253-267

is to be taken and valued in the actual condition in which the owner holds it (Village of Aurora vs. Commissioner of Taxation, 217 Minn. 64 {1944}; Aetna Life Ins. Co. vs. City of Newark, 10 N.J. 785 {1952}.” (Adoracion V. Madulid vs. BAA of Quezon City and City Assessor of Quezon City, CBAA Case No. 47, Feb. 3, 1976).”

While the Certificate of Sale over the subject lots was issued on

December 14, 1989, Petitioner-Appellant requested Respondent-Appellee for

reclassification of the same lots from “industrial” to “agricultural” only in 1993

per letter dated January 9, 1993 (p. 13, Record) which letter reached

Respondent on January 25, 1993 (Answer, p. 154, Record).

Petitioner-Appellant is now barred by estoppel or laches to assail the

classification of the lots retroactive to 1989, the time he acquired the lots, which

the Supreme Court defines as “failure or neglect for an unreasonable and

unexplained length of time, to do that which, by exercising due diligence, could

or should have been done earlier.” (La Campana Food Products, Inc., vs. Court

of Appeals, G.R. No. 88246, June 4, 1993).

After an ocular inspection, Respondent-Appellee granted Petitioner-

Appellant’s request on February 1, 1993 (Answer, supra). As correctly stated by

Respondent-Appellee, the effectivity of the reclassifications or reassessments

shall take effect only on the first day of January, 1994 in accordance with the

provisions of Section 221, R.A. 7160, which provides as follows:

“SEC. 221. Date of Effectivity of Assessment or Reassessment. – All assessments or reassessments made after the first (1st) day of January of any year shall take effect on the first (1st) day of January of the succeeding year.”

Respondent-Appellee, in denying Petitioner-Appellant’s request for

copies of tax declarations on subject lots, cited Office Memo No. 04-90 dated

August 22, 1990 issued by Merlita V. Caelian, OIC City Assessor of Cadiz City

(p. 77, Record), which stated that “no transfers of Property Records as well as

issuances of certifications and certified true copies of the same nature be

issued unless payment of real property taxes to the current quarter and

certification fees to be paid.

Reference: Book VII, pp. 253-267

It is the duty of the Assessor to issue copy of the declarations upon

payment of fees to a requesting party pursuant to Section 472 (g) of the Local

Government Code (R.A. 7160) which provides as follows:

“Sec. 472. Qualifications, Powers and Duties.

“The assessor shall take charge of the assessor’s office, perform the duties provided for under Book II of this Code and shall:

x x x

9. Issue, upon request of any interested party, certified copies of assessment records of real property and all other records relative to its assessment upon payment of a service charge or fee to the treasury:”

x x x

In his Answer (pp. 129-130, Record), Respondent-Appellee states that

pursuant to the provisions of Article 322 of IRR of R.A. 7160, this case should

not have been entertained for failure of Petitioner-Appellant to pay under

protest, the corresponding realty taxes due on the contested assessment. This

issue, however, has been rendered moot and academic in view of the actions

taken by the Local Board on this case.

WHEREFORE, the Decision of the Local Board denying the

reclassification of the herein lots from industrial to agricultural effective from

1979 to 1993 is hereby AFFIRMED. Respondent-Appellee is hereby

ORDERED to furnish Petitioner-Appellant the requested tax declarations upon

payment of required service charge or fees.

SO ORDERED.

Manila, Philippines, February 22, 1995.

(Signed) MARGARITA G. MAGISTRADO
Chairman

(Signed)

ELEANOR A. SANTOS VACANT Member Member

Reference: Book VII, pp. 253-267