PROCEDURAL LAPSES, UNSUBSTANTIATED CLAIMS: Iloilo City gov’t scores win as Supreme Court dismisses RPT petition

ILOILO CITY — The Supreme Court (SC) en banc has dismissed the petition for certiorari, prohibition, and mandamus filed by private parties questioning Iloilo City’s real property tax (RPT) adjustments through Tax Ordinance 2023-226, citing multiple procedural and substantive grounds.

Iloilo City Legal Officer Atty. Joseph Edward Areño, who confirmed in an interview that the city received a copy of the notice of judgment, said the High Court’s ruling underscores the petitioners’ failure to comply with established legal processes.

“The Supreme Court dismissed the case on several grounds, including failure to observe the hierarchy of courts,” Areño explained.

He added that the petitioners, lawyers Teodoro Pison and Rosalinda Pison, Riverside Holdings Corp., and Riverside Boardwalk Properties Inc., also raised issues that are not purely questions of law, as there are still factual matters that need to be determined.

Areño emphasized that the SC, as a court of law, primarily resolves legal questions based on established and undisputed facts.

In this case, petitioners alleged that RPT increases reached as high as 3,000% but failed to substantiate these claims with sufficient evidence.

Wrong forum, missed remedies

The city legal officer said challenges to tax ordinances and assessments must follow a prescribed process.

Taxpayers must first pay the assessed tax under protest and file through proper administrative and judicial channels.

“Procedurally, they should have brought it first before the Regional Trial Court or the Court of Tax Appeals, especially if factual issues need to be examined,” he said.

He cited a separate opinion penned by Senior Associate Justice Marvic M.V.F. Leonen, which reiterated that direct recourse to the Supreme Court is improper when other remedies remain available or when factual questions are unresolved.

“Petitioners neither filed an appeal before the Local Board of Assessment Appeals after they received the assessment notice on Dec. 18, 2023, nor paid the tax under protest; but instead, resorted to a procedural shortcut by immediately instituting a special civil action before this Court. Consequently, the petition cannot prosper for failure to exhaust administrative remedies,” read part of Leonen’s concurring opinion. 

Lack of evidence on alleged increase

Beyond procedural lapses, the city legal officer said the petitioners were unable to substantiate claims that the tax adjustments were excessive or confiscatory.

“They claimed significant increases, but these allegations must be supported by facts. The Supreme Court does not determine disputed facts,” he said.

City followed due process

Areño maintained that Iloilo City complied with all legal requirements in implementing the updated tax ordinance.

He noted that the determination of fair market values was based on assessments conducted by professionals, including assessors and real estate practitioners.

He also stressed that the passage of the tax ordinance underwent proper legislative processes, including public hearings and consultations.

“The tax rates applied are part of a policy decision by the Sangguniang Panlungsod, while the fair market values were determined through technical evaluation,” he said.

While the petition has been dismissed by the Supreme Court en banc, Areño said the petitioners may still file a motion for reconsideration.

However, he noted that the ruling carries significant weight as it was issued by the court sitting en banc.

“This is already a decision by the highest court of the land,” he said.

New law now in effect

Moreover, Areño pointed out that developments have overtaken some of the issues raised in the petition, with the implementation of the Real Property Valuation and Assessment Reform Act (RPVARA), which took effect in July 2024.

Under the new law, updated schedules of market values will be prepared and subject to approval by the Department of Finance, which will serve as the basis for future property valuations.

In the ruling, the SC also cited that the assessment of real property values for taxation purposes is a technical matter that requires the gathering and evaluation of empirical data. This fact is amplified by the RPVARA.

“As it now stands, LGUs are duty-bound to follow the provisions of the RPVARA and its implementing rules,” the SC decision read. (City Hall PR)