Supreme Court rules: QC government can’t seize Manila Seedling Bank property

MANILA, Philippines — The Supreme Court ruled that the Quezon City government cannot foreclose and seize the property of the Manila Seedling Bank Foundation (MSBF) for non-payment of real property tax, as it is owned by the National Housing Authority, a tax-exempt institution.

In an en banc decision dated July 30, 2024, and made public on Thursday, August 8, the Court said, “The city may satisfy its tax claim not through a foreclosure, but by directly assessing the Foundation.” The ruling was penned by Associate Justice Ramon Paul Hernando.

The Supreme Court’s public information office noted in a press release that the property had been foreclosed and sold at a public auction.

In 2014, following the Quezon City government’s acquisition of the seven-hectare green space, structures were demolished to pave the way for commercial development. Environmentalists decried the demolition as a loss of one of Metro Manila’s precious green spaces in favor of urban development.

Given the illegal closure of the property, the Supreme Court said that MSBF may file a case against the Quezon City government.

The Supreme Court also invalidated the 2003 amendment to the Quezon City zoning ordinance that reclassified the property into a Metropolitan Commercial Zone and a portion of it into an Institutional Zone.

The High Court ruled that the Quezon City government lacked the authority to alter the property’s designation from its original use, as established by Proclamation No. 1670, a national law signed by then-president Ferdinand Marcos.

This proclamation granted the MSBF usufructuary rights over the property for 50 years, allowing its use for environmental purposes, including growing seedlings for the government’s reforestation program until 2027.

“[L]ocal ordinances that contravene State-enacted legislation [are] null and void since LGUs (local government units) merely derive their power from the State legislature, as such, they cannot regulate activities already allowed by statute. Municipal ordinances are considered inferior in status and subordinate to the laws of the state; thus LGUs have no power to regulate conduct already regulated by the state legislature,” the Supreme