Ordinance vs Resolution: Why LGUs Need an Ordinance for Expropriation

The Supreme Court has settled a recurring question for local governments: can a municipal council authorize the expropriation of private property through a mere resolution? In Municipality of Parañaque v. V.M. Realty Corporation (G.R. No. 127820, July 20, 1998), the Court answered with a firm no. Under the Local Government Code of 1991 (RA 7160), an ordinance—not a resolution—is required before a local government unit (LGU) may exercise the power of eminent domain. This distinction matters to property owners and local officials alike, because a defective authorization can void an expropriation case from the start.

The Case: A Socialized Housing Project That Stalled

The Municipality of Parañaque sought to expropriate two parcels of land totaling about 10,000 square meters in San Dionisio for a socialized housing project. The municipal council passed Sangguniang Bayan Resolution No. 93-95, Series of 1993, authorizing the mayor to file the expropriation complaint. The municipality then filed suit in 1993.

The property owner, V.M. Realty Corporation, moved to dismiss the case. It argued that the complaint lacked a cause of action because it was based on a resolution, not an ordinance, as RA 7160 requires. The owner also invoked res judicata, pointing to a 1988 dismissal of an earlier expropriation case over the same property.

The trial court dismissed the case, and the Court of Appeals affirmed. The Supreme Court upheld the dismissal—but with an important qualification on the res judicata issue.

The Issue: Is a Resolution Enough?

The central question was whether a resolution of the Sangguniang Bayan substantially complied with Section 19 of RA 7160, which states that an LGU may exercise eminent domain "through its chief executive and acting pursuant to an ordinance."

The municipality argued that a resolution was sufficient, citing the Implementing Rules of the Local Government Code, which mentioned a "resolution of the Sanggunian." It also pointed to an older case, Province of Camarines Sur v. Court of Appeals, where a resolution had been accepted.

The Ruling: Ordinance Is a Hard Requirement

The Supreme Court rejected the municipality's arguments. The Court explained that an ordinance and a resolution are fundamentally different:

• An ordinance is a law—it has a general and permanent character and requires three readings.
• A resolution is merely a declaration of the sentiment or opinion of a lawmaking body on a specific matter; it is temporary in nature.

The Court emphasized that the old Local Government Code (BP 337) had allowed expropriation through a mere resolution. But Congress deliberately changed the language in RA 7160 to require an ordinance. Where a statute is clear, the Court said, it must be applied according to its express terms. The change in wording was intentional and significant, especially because eminent domain involves a derogation of a fundamental private right—the right to property.

The Court also dismissed the municipality's reliance on the Implementing Rules. A mere administrative rule cannot amend the clear letter of the law. If the rule conflicted with Section 19, the law prevails.

Res Judicata Does Not Bar Future Expropriation

On the second issue, the Court made a notable clarification. While the elements of res judicata were present—the earlier case was final, involved the same property, and was decided on the merits—the principle cannot permanently bar the State or its agent from exercising eminent domain.

Eminent domain is an inherent power of the State. A prior dismissal for non-compliance with legal requirements does not extinguish that power. The State may reinstitute expropriation proceedings once all legal requirements are properly complied with. What res judicata does bar is the relitigation of specific issues already decided—for example, whether a prior offer was made. But it cannot prevent the government from correcting its defects and trying again.

Practical Takeaways

• Local governments must pass an ordinance, not just a resolution, before filing an expropriation case. The ordinance must specifically authorize the chief executive to pursue the expropriation of the particular property.
• Property owners can challenge expropriation cases that are based only on a resolution. The complaint would fail to state a cause of action.
• A prior dismissal does not give permanent protection to property owners. If the LGU later complies with all legal requirements—including passing the proper ordinance—it may file a new expropriation case over the same property.
• The Implementing Rules cannot override the law itself. If the rules appear to allow a resolution, the clear text of RA 7160 controls.
• Valid and definite offer requirement remains: before expropriating, the LGU must first make a valid and definite offer to the owner, and that offer must have been rejected.

This article is general information and not legal advice. For your specific situation, consult a lawyer or ask ASG Legal AI.