Republic of the Philippines



– versus –


CBAA CASE NO. V-01 Re: T.D. No. 42555
and 42556 Tacloban City

– and –

Respondents-Appellees. x – – – – – – – – – – – – – – – – – – – – – – – – – – – x


This is a motion for reconsideration, filed by the Appellee, Board of

Assessment Appeals of Tacloban City, and the City Treasurer of Tacloban City,

Respondent-Appellee, seeking to set aside the decision of this Board,

dispositive portion of which is hereinbelow quoted, viz:

“WHERERFORE, in view of the foregoing the Resolution of the Local Board of Assessment Appeals of Tacloban City, dated November 21, 1991, is hereby modified to state that the provisions of Section 40(a) P.D. 464, is not applicable to the Tacloban Far East Marketing Corporation, the Petitioner-Appellant, herein, and that under the same provision of law, it is exempt from the payment of real property taxes. Respondent-Appellee, City Assessor of Tacloban, is hereby ordered to cancel Tax Declaration Nos. 42555 and 42556, Petitioner-Appellant being exempt, and further to assess under new tax declaration all improvements which are exclusively belonging to Petitioner-Appellant, built and constructed within the premises of the bus terminal, now existing, in accordance with the assessment law.

Respondent-Appellee, City Assessor of Tacloban City is hereby ordered to act accordingly.


In its motion, both Appellee and Respondent-Appellee claimed that:

(a) this Board “failed to fully appreciate the contents and substance of the contract” (paragraph 4, Motion for Reconsideration)

(b) “the Title of the contract is a misnomer because even if it (title) speaks of management only, the provisions thereof clearly illustrate an agreement of lease wherein the parties affected mutually agree to have the properties subject matter thereof leased to Petitioner-Appellant.” (paragraph 5, supra)

Reference: Book VII, pp. 164-168

(c) “beneficial use” may be interchangeably used with “actual use” for purposes of applicability of Section 40(a), P.D. 464, as amended. (paragraph 13, supra)

A perusal of the records disclose that the issues claimed are interrelated

and have already been thoroughly discussed and passed upon by the Board in

its decision and no new or substantial reasons are advanced by the movants to

justify a reconsideration of subject decision.

To recapitulate on some points, movants’ claim that “beneficial use” may

be interchangeably used with “actual use” in the applicability of Section 40(a),

P.D. 464, is erroneous.

Black’s Law Dictionary, pages 188-189, citing Reiming vs. Railroad Co.,

Superior Court, 13 N.Y. Supp. 240, defines “beneficial use” as follows:

“The right to use and enjoy property according to one’s own liking as to derive profit or benefit from it, including all that makes it desirable from mere right of occupancy or possession” (underscoring supplied)

Whereas, this Board in CBAA Case No. 260, Asuncion Jamora vs. Board

of Assessment Appeals of Manila, et al, defines “actual use” (as defined in the

Code) as follows:

“Actual use refers to the purpose for which the property is principally or predominantly utilized by the person in possession of the property.”

and for purposes of assessment, Section 19, P.D. 464, as amended, states


“x x x. Real properties shall be assessed on the basis of its actual use regardless of where located and whoever uses it.”

Accordingly, “for purposes of assessment, valuation and classification,

“actual use” as used in the Code should not be construed as a criterion for the

classification and valuation of real property, but as a determining factor in

applying the appropriate percentage of level of assessment, as provided in

Section 20, P.D. 464, as amended, to the market value or schedule of base unit

construction costs. (CBAA Case No. 260, supra).

On the second hand, “beneficial use” is the determining factor in applying

the tax liability of a state property the use of which is granted for consideration

or otherwise to a taxable person, while “actual use” is a determinative factor in

Reference: Book VII, pp. 164-168

applying the appropriate percentage level of assessment to arrive at the

assessed value.

As differentiated from a management contract, beneficial use is the

enjoyment of a thing for profit or benefit, to its own liking, including all that

makes it desirable, from mere right of occupancy or possession, whereas in

management contract, the enjoyment of the use of the thing is limited to what is

so provided in the contract, and is a personal right over it, possession or

occupancy not being transferred.

On the issue that the Board failed to fully appreciate the contents and

substance of the contract, it may be of note that what is determinative was that

Board’s ruling on the merits of the case, the intent of the parties, as provided in

the contract and not on the nomenclature or classification of the contract.

“It is elementary that the real intention of the parties at the time the written instruments were executed must govern in the interpretation given to them by the court, and to this certain circumstances should be considered, such as x x x; their statement and acts at the time of the transaction; x x x. (Jones, Commentaries on Evidence, 1913; Vol. 8; par. 44607; Monagas vs. Albertucci (235 U.S. 81, 83), cited in Cuyugan vs. Santos, 34 Phil. 114) (Villanueva vs. Geroche, CA-G.R. No. 49-R, 44 O.G. 2302) page 491, par. 208, Velayo’s Digest)” (underlining supplied)

“It is settled that in the construction of contracts, the intention of the parties should be ascertained; and in ascertaining it, regard must be paid to the nature and character of the contract. (Fable vs. Mordero, CA-G.R. No. 3074-R, Oct. 31, 1952)” (underlining supplied)

With respect to the other issues raised, it appears that the same had

already been fully resolved by this Board in its decision now under


WHEREFORE, finding no sufficient justification nor valid reason to

disturb or alter our earlier decision, the herein Motion for Reconsideration is

hereby DENIED.


Manila, Philippines, July 15, 1993.


Reference: Book VII, pp. 164-168



Reference: Book VII, pp. 164-168