Republic of the Philippines
Department of Finance
CENTRAL BOARD OF ASSESSMENT APPEALS
7th Floor, EDPC Bldg., BSP Complex
Roxas Boulevard, Manila

ATTY. RACIMO R. ESTAMPADOR,
Petitioner-Appellant,
CBAA CASE NO. L-123
-versus-(LBAA CASE NO. 96-3704)

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

-and-

THE CITY ASSESSOR OF MANILA,
Respondent-Appellee.
X- – – — – – – – – – – – – – – – – – – – – – – – x

R E S O L U T I O N
For consideration by this Board is a Motion for Reconsideration of this Board’s Decision rendered in the above-entitled case on August 15, 2013. This Motionwas filed with this Board on September 13, 2013.
Alleging that he received a copy of the assailed Decision on September 2, 2013, Petitioner-Appellant raised the following “reasons/grounds”:
“(1) That the Honorable CENTRAL BOARD committed a grave error and clear misconception that the said BILATERAL CONTRACT OF LEASE is a PRIVATE CONTRACT but in truth and in fact it is a GOVERNMENT CONTRACT or PUBLIC CONTRACT. To define a private and government contract:
“A private contract is one between individuals only and affects only private rights; a public contract is one to which the state is a party, and which concerns all citizens. There is a well-recognized distinction between such contracts as respect the power and authority of the contracting parties.”
“(2) That the HONORABLE CENTRAL BOARD committed a serious and grave error by overlooking the fact that the CONTRACT OF LEASE of the PETITIONER-APPELLANT is a BILATERAL CONTRACT OF LEASE with the NATIONAL GOVERNMENT (REPUBLIC OF THE PHILIPPINES) represented herein by its agency, Bureau of Building and Real Property Management Department of General Services, created and constituted pursuant to EXECUTIVE ORDER NO. 290 SERIES OF 1958 and its Director in his official capacity is such herein referred to as Lessor, is the agency of the Republic of the Philippines, empowered and authorized to administer and dispose of the parcel of land subject in the CONTRACT OF LEASE pursuant to the provisions of COMMONWEALTH ACT 141 as amended as the government official is acting in his official capacity as such acting with sovereign power/authority of the State (Republic of the Philippines).

“(3) That the HONORABLE CENTRAL BOARD obviously overlooked the fact that the National Government (Republic of the Philippines the State) has imposed all the Terms and Conditions of the subject CONTRACT OF LEASE with the PETITIONER-APPELLANT (Lessee/ATTY. RACIMO R. ESTAMPADOR) in accordance with all the existing laws and the Philippine Constitution in which the PETITIONER-APPELLANT (Lessee) agreed to the Terms and Conditions imposed in the LEASE AGREEMENT as the NATIONAL GOVERNMENT was exercising its Sovereign Power/Authority as the State. Foremost in the Terms and Conditions of the said Lease:

“That the term of this lease shall be for a period of TWENTY-FIVE (25) years effective upon the signing of this document renewable for another term of twenty-five (25) years upon agreement of both parties after which all improvements within the leased premises shall become the property of the LESSOR without any need of a conveyance by the LESSSOR;

“That the LESSEE shall cause to be paid and or pay to the LESSOR or its duly authorized representative a monthly rental for the premises and improvement leased to him the sum of ONE THOUSAND FOUR HUNDRED SEVENTY PESOS (P1,470.00) The Philippine Currency, on or before the 15th day of each calendar month;

“All taxes and assessments levied or to be levied upon the leased premises shall be for the exclusive account of the LESSOR, and all taxes and assessments levied for the improvements shall be for the exclusive account of the LESSEE;

“The re-appraisal of the leased property should be made every five (5) years from the date of the signing of this contract by the Appraisal Committee, the composition of which is determined by Department Order No. 3 (DGS), dated January 30, 1968, to determine the new rate of rental for the leased premises. The new rental will automatically become the rental for the next five (5) succeeding years.”

“And other terms/conditions that the National Government is in full control of operations/movements of its lessee (Petitioner-Appellant) in the said leased area/premises. Logically, the laws of the Obligations and Contracts and the Civil Code provisions of the Philippine Constitution specifically the Non-Impairment Clause, Due Process and Equal Protection Clause shall be strictly followed in the consummation/existence of the lifetime of the subject CONTRACT OF LEASE as to all terms and conditions.

“(4) That the HONORABLE CENTRAL BOARD absolutely erred in ignoring the fact that the Land of Public Domain of the Republic of the Philippines (National Government) is the subject land of the CONTRACT OF LEASE between the Republic of the Philippines (National Government) and the PETITIONER-APPELLANT (ATTY. RACIMO R. ESTAMPADOR) as lessee.

“As Lessor (Republic of the Philippines) it has the Sovereign Power/Authority to delegate and designate any department/bureau to administer and dispose of land of public domain of the National Government in which case the subject CONTRACT OF LEASE of PETITIONER-APPELLANT was administered under the jurisdiction/administration of Bureau of Building and Real Property Management Department of General Services/Administration in the year of 1924-1987 covered by Executive Order No. 290 Series of 1958 then to Department of Environment and Natural Resources covered under Executive Order 285 in the year of 1987 to 1988 under Executive Order 321 then to Department of Transportation and Communication to the line agency Philippine Ports Authority from March 18, 1988 to the expiration of the CONTRACT OF LEASE of the PETITIONER-APPELLANT (Lessee) in which the said CONTRACT OF LEASE has been respected by the National Government.

“(5) That the HONORABLE CENTRAL BOARD committed a very serious error for not considering the Decision of the Supreme Court Promulgated in August 24, 2011 G.R. No. 185023 City of Pasig-Represented by the City Treasurer and the City Assessor vs. Republic of the Philippines Represented by the Presidential Commission on Good Government. The decision absolutely showed that PETITIONER-APPELLANT (ATTY. RACIMO R. ESTAMPADOR) is absolutely exempted from paying the Real Estate Tax of the subject Leased Land of Public Domain of the National Government covered by CONTRACT OF LEASE with the Republic of the Philippines to the said Supreme Court Decision based on Section 234(a) of the Republic Act No. 7160 which law is the basis that PETITIONER-APPELLANT is exempted of paying Real Tax and other cases were cited to prove further that PETITIONER-APPELLANT is ABSOLUTELY EXEMPTED FROM PAYING REAL E3STATE TAX:

“Section 234(a) of Republic Act No. 7160 states that properties owned by the Republic of the Philippines are exempt from real property tax except when the beneficial use thereof has been granted, for consideration or otherwise, to a taxable person. Thus, the portions of the properties not leased to taxable entities are exempt from real estate tax while the portions of the properties leased to taxable entities are subject to real estate tax. The law imposes the liability to pay real estate tax on the Republic of the Philippines for the portions of the properties leased to taxable entities. It is of course, assumed that the Republic of the Philippines passes in the real estate tax as part of the rent to the lessees.”

Furthermore, Part 1, Art III, DOF, Assessment Regulations No. 3-75 absolutely proves that PETITIONER-APPELLANT is totally exempted from paying Real Estate Taxes for leasing the Land of Public Domain of the Republic of the Philippines which covered by the PETITIONER-APPELLANT’S CONTRACT OF LEASE IN QUESTION. To quote:

“Only patrimonial property of the government are taxable. The real property owned by the Republic of the Philippines or its political subdivisions which are taxable in the name of the person who is using it, refers to their patrimonial or private properties under the Civil Code and excludes real property for public use and for public service, which are beyond the commerce of man, and to lands of public domain granted, sold or leased under Com. Act No. 141.”

We are having difficulty trying to understand what Petitioner-Appellant is talking about. For instance, Petitioner argues that the real property subject of the Contract of Lease is part of the public domain and, therefore, beyond the commerce of man. If so, why then is the same property being leased to and by the Petitioner-Appellant?
Petitioner-Appellant further argues that “Part 1, Art III, DOF, Assessment Regulations No. 3-75 absolutely proves that PETITIONER-APPELLANT is totally exempted from paying Real Estate Taxes for leasing the Land of Public Domain of the Republic of the Philippines which covered by PETITIONER-APPELLANT’S CONTRACT OF LEASE IN QUESTION. To quote:
“Only patrimonial property of the government are taxable. The real property owned by the Republic of the Philippines or its political subdivisions which are taxable in the name of the person who is using it, refers to their patrimonial or private properties under the Civil Code and excludes real propertyfor public use and for public service, which are beyond the commerce of man, and to lands of public domain granted, sold or leased under Com. Act No. 141.” (Emphasis supplied)

Petitioner-Appellant erroneously misinterpreted the above quotation. Simplified, the said quotation would appear thus:
“Only patrimonial property of the government are taxable. The real property owned by the Republic of the Philippines or its political subdivisions which are taxable in the name of the person who is using it, refers:
1. to their patrimonial or private properties under the Civil Code (excluding real propertyfor public use and for public service, which are beyond the commerce of man)and
2. to lands of public domain granted, granted, sold or LEASED under Com. Act No. 141.
It would be insulting to some people if we further explained the above. Anyway, after a careful perusal of the “grounds/reasons” advanced by Petitioner-Appellant in his said Motion, we find absolutely no cogent reason to disturb our Decision of August 15, 2013.
WHEREFORE, the instant Motion for Reconsideration is herby DENIED for lack of merit.
SO ORDERED.
Manila, Philippines, November 13, 2013.

SIGNED
OFELIA A. MARQUEZ
Chairman

SIGNED SIGNED
ROBERTO D. GEOTINA CAMILO L. MONTENEGRO
MemberMember