In the recent case of, the Supreme Court clarified an important jurisdictional distinction involving condominium disputes and criminal violations under.
The case stemmed from a condominium transaction where the buyer filed a criminal complaint for violation of P.D. 957 against the developer. During the proceedings, the RTC not only resolved the criminal aspect of the case but also ruled on contractual matters arising from the parties’ Contract to Sell, including reimbursement and delivery of the condominium unit.
The Supreme Court ruled that while the RTC properly exercised jurisdiction over the criminal prosecution, it had no jurisdiction over the contractual disputes between the buyer and the developer.
According to the Court, the civil liability imposed by the RTC was not civil liability arising from the crime (ex delicto), but civil liability arising from contract (ex contractu). Since the source of the obligation was contractual, jurisdiction belonged exclusively to the HLURB — now the (HSAC) — under P.D. No. 1344.
The Court emphasized that disputes involving:
refund,
reimbursement,
delivery of condominium units,
specific performance, and
other buyer-developer contractual obligations
fall within the exclusive jurisdiction of the HLURB/HSAC and must be filed separately from the criminal case.
As a result, the RTC’s ruling on the contractual civil aspect was declared void for lack of subject matter jurisdiction.
The ruling is significant because it reinforces the distinction between civil liability ex delicto and civil liability ex contractu. While civil liability arising from a crime may generally be impliedly instituted with the criminal action, this rule does not apply when the obligation arises from contract. In such cases, jurisdiction is determined not by the criminal charge, but by the nature of the contractual dispute and the special law granting exclusive jurisdiction to the HLURB/HSAC.
The decision serves as an important reminder for lawyers, real estate practitioners, and condominium buyers that criminal proceedings under P.D. 957 do not automatically authorize regular courts to resolve contractual disputes reserved by law to specialized housing adjudication bodies.
For further reading, here is the link of the case:
A recent court hearing involving an expropriation case provided an important and revealing glimpse into the realities of litigation appraisal and the role of commissioners under Rule 67 of the Rules of Court. The proceeding highlighted not only the technical demands of valuation in expropriation cases, but also the constitutional importance of independence and competence among commissioners appointed to assist the court.
In the hearing, one of the commissioners nominated by the plaintiff, the National Grid Corporation of the Philippines (NGCP), was placed on the witness stand and subjected to cross-examination. The commissioner testified that she had served for around thirty years with Napocor and NGCP and had appeared in more than 300 expropriation proceedings as commissioner. On the surface, the credentials appeared extensive and impressive.
However, as the testimony progressed, serious questions emerged regarding the valuation approach and the commissioner’s understanding of her role under Rule 67.
Under Sections 6 and 7 of Rule 67, commissioners occupy a unique position in expropriation proceedings. They are not ordinary witnesses, nor are they advocates for the parties who nominated them. Commissioners are auxiliaries of the court — technical aides tasked to assist the judge in determining just compensation. Because expropriation involves the constitutional taking of private property, the Rules expressly require commissioners to be “competent and disinterested.”
The hearing illustrated why these qualifications are indispensable.
Although the commissioner presented three comparable sales in her report, she ultimately anchored her conclusion on the BIR zonal value and treated it as the basis for just compensation. Defense counsel immediately challenged this methodology, correctly arguing that BIR zonal values are primarily intended for taxation purposes and are not, by themselves, determinative of market value in expropriation proceedings.
Even the trial judge appeared unconvinced and questioned why the valuation could not exceed the zonal value despite the comparable market indicators presented in the report. The commissioner’s response — “makatapal mi ana, Judge” — became a telling moment during the hearing.
At that point, the issue ceased to be merely methodological. It became a question of competence, independence, and fidelity to the commissioner’s duty under Rule 67.
The situation became even more significant when defense counsel asked whether, as an NGCP engineer, the commissioner was protecting the interests of the company. The commissioner answered in the affirmative.
That admission goes directly to the heart of the Rules of Court. A commissioner is not appointed to protect the interests of either the expropriating agency or the landowner. The commissioner’s duty is owed to the court. The obligation is to provide an independent, objective, and professionally defensible opinion to assist the judge in arriving at just compensation. Once a commissioner openly identifies with the interests of one party, the requirement that the commissioner be “disinterested” is placed into serious question.
The hearing likewise provides valuable lessons for new appraisers and those planning to enter litigation appraisal practice.
Courtroom valuation is fundamentally different from ordinary appraisal assignments conducted for banks, internal corporate use, or taxation purposes. In litigation, every assumption, adjustment, methodology, comparable sale, and conclusion may be subjected to intense scrutiny through cross-examination and judicial evaluation. A report is not judged merely by how it is written, but by whether it can withstand legal and technical examination under oath.
More importantly, litigation appraisal is not simply about arriving at a value. It is about demonstrating professional independence, analytical rigor, credibility, and ethical discipline. An appraiser who enters the courtroom without a strong grasp of valuation principles, legal standards, evidentiary requirements, and the constitutional framework governing just compensation risks not only discrediting the report, but also undermining the court’s search for fairness.
The hearing also reflects a broader concern within expropriation practice. There remains a tendency among some commissioners and agency appraisers to treat zonal values as ceilings rather than mere tax benchmarks. Others become overly aligned with institutional interests. But the constitutional standard is neither convenience nor accommodation. The constitutional standard is just compensation.
At the final analysis, the courtroom remains the ultimate testing ground of appraisal practice. Reports must not only be prepared — they must be defensible. Opinions must not only be asserted — they must be supported by evidence, methodology, and independent reasoning. Above all, the appraiser must remember that the duty is not to produce a value desired by a party, but to assist the court in the fair and impartial determination of value.
I recently wrote a comment on the Central Visayas Regional Development Plan 2023–2028 examining the region from the perspective of regional economics, spatial planning, and archipelagic development. The paper has likewise been formally transmitted to the Regional Development Council (RDC-VII) and the Department of Economy, Planning, and Development (DepDev) Region VII for their consideration as part of the broader discussion on the future development trajectory of Central Visayas.
I believe that sharing these discussions with the broader public is equally important. Regional development planning should not remain confined solely within technical institutions, planning agencies, or government offices. The future of Central Visayas affects communities, businesses, local governments, professionals, environmental sectors, transport systems, housing systems, and the broader regional economy itself. Public discussion, academic engagement, and policy discourse are therefore essential in strengthening long-term regional planning and institutional decision-making.
For decades, development in Central Visayas has largely been driven by infrastructure expansion, metropolitan growth, and connectivity. In many ways, this strategy worked. Metro Cebu emerged as the country’s second major metropolitan economy outside Metro Manila, supported by expanding ports, airports, logistics systems, tourism, and commercial activity.
But beneath this success lies a deeper regional challenge.
Central Visayas is not simply a metropolitan corridor—it is an archipelagic regional economy composed of fragmented island systems heavily dependent on transportation, maritime connectivity, logistics, and coastal urbanization. Cebu and Bohol alone consist of hundreds of islands and islets linked through ports, ferry systems, airports, tourism corridors, and inter-island transportation networks.
In archipelagic economies, infrastructure plays a dual role. Connectivity strengthens mobility, trade, tourism, and economic integration. At the same time, however, it also concentrates economic activity around dominant urban-maritime nodes. In the Visayas, that node became Metro Cebu.
Over time, Metro Cebu evolved into the region’s dominant metropolitan intermediary, integrating transportation systems, labor mobility, logistics networks, tourism activity, and higher-order urban functions across interconnected island economies. This generated rapid economic growth, with Central Visayas becoming one of the Philippines’ fastest-growing regional economies.
Yet the same concentration dynamics also intensified traffic congestion, infrastructure saturation, housing pressures, rising land values, flooding vulnerability, watershed encroachment, and ecological stress. Many peripheral territories likewise became increasingly dependent upon Metro Cebu for employment, transportation access, investment flows, logistics systems, and higher-order services.
The long-term challenge confronting Central Visayas is therefore no longer simply how to expand infrastructure or accelerate metropolitan growth. The deeper issue concerns whether regional integration can generate more territorially distributed, ecologically sustainable, climate-responsive, and production-oriented development across the broader Visayas archipelago.
Ultimately, the future of Central Visayas may depend not merely upon building a stronger metropolis, but upon building a stronger and more resilient archipelagic regional economy.
Today, Gus Agosto, a licensed Environmental Planner, sent his formal reply to the Department of Human Settlements and Urban Development (DHSUD), signaling a continuing exchange on the review of the Cebu City Comprehensive Land Use Plan (CLUP) 2023–2032.
The exchange brings into focus a critical issue in Philippine land use planning: the alignment of existing planning practices with Republic Act No. 11995, or the Philippine Ecosystem and Natural Capital Accounting System (PENCAS) Act.
Gus Agosto, a former ADB Consultant, stressed that “the law is already in force.” Consequently, its requirements—especially the integration of environmental and natural capital considerations into planning and decision-making—are neither prospective nor optional, but are binding elements of the existing legal framework governing land use.
While the Department has emphasized the need for technical readiness, including the development of standardized datasets and frameworks, it is important to underscore that institutional readiness does not suspend legal obligation. A clear distinction must be made between full technical implementation and minimum compliance. Even at present, there are sufficient tools—such as hazard mapping, watershed delineation, and environmental constraints analysis—to begin integrating ecological limits into planning decisions.
Deferring integration to the “next CLUP cycle,” which may span nearly a decade, risks allowing land use decisions to proceed under frameworks that do not reflect current legal and environmental realities. In a region like Cebu, which continues to face recurring disasters and environmental stress, such delay raises serious concerns about the adequacy of planning safeguards.
Recent events—including the Binaliw dumpsite collapse in January 2026 and the widespread devastation caused by Typhoon Tino in 2025—underscore the real-world consequences of land use decisions that fail to fully account for environmental risks. These incidents highlight the urgency of ensuring that planning frameworks evolve in step with both law and lived experience.
“The issue is not whether we can fully implement PENCAS today, but whether we can justify continuing to approve land use decisions that ignore a law already in force. We already know where the risks are. The responsibility now is to ensure that planning decisions reflect that reality—before the next disaster forces the correction.” Consultant Agosto said.
The objective is not to disrupt planning processes, but to strengthen them. A transitional approach—where PENCAS principles are integrated to the extent practicable while full systems are being developed—offers a balanced and legally sound path forward.
The question is not whether we are ready to implement the law, but whether we can afford not to.
Following is my letter reply to the DHSUD:
HON. ATTY. RAMON QUINTIN CLAUDIO C. ALLADO Undersecretary Department of Human Settlements and Urban Development (DHSUD) Kalayaan Avenue, Diliman Quezon City
CC : DIRECTOR, LEGAL SERVICE
Re: Response to DHSUD Letter dated 16 February 2026 On the Review and Implementation of the Cebu City CLUP 2023–2032
Dear Undersecretary Allado:
I acknowledge receipt of your letter dated 16 February 2026 concerning the review and implementation of the Cebu City Comprehensive Land Use Plan (CLUP) 2023–2032 in relation to the Philippine Ecosystem and Natural Capital Accounting System Act (PENCAS, Republic Act No. 11995).
While I appreciate the Department’s recognition of natural capital accounting’s role in land use planning, I respectfully register strong reservations regarding the proposal to defer its integration until complete frameworks, datasets, and guidelines are issued—or to limit it to the next CLUP cycle.
1. Immediate Binding Effect of the PENCAS Act
Republic Act No. 11995 is in full force and binds all government agencies, including DHSUD, in their administrative functions. The absence of complete technical frameworks or datasets does not suspend this obligation; administrative convenience cannot supersede a statutory mandate.
2. CLUP Approval as a Continuing Administrative Act
CLUP review and approval constitute an ongoing administrative function that must align with laws in effect at the time of the decision. Approving a CLUP without incorporating PENCAS requirements undermines its substantive legal validity, irrespective of procedural compliance.
3. Impropriety of Deferral to the Next Cycle
Deferring the integration of PENCAS to the “next cycle”—effectively a decade from the current 2023–2032 planning horizon, especially in a context marked by historical delays in plan updating—is untenable in the face of recurring and intensifying disasters in Cebu. Recent events, including the January 2026 Binaliw dumpsite collapse that claimed 36 lives, and Typhoon Tino (2025), which left at least 158 fatalities, dozens missing, and thousands injured across Compostela, Liloan, Balamban, Danao City, and Cebu City, underscore the grave consequences of inadequate land use planning.
These incidents are not isolated occurrences, but manifestations of systemic vulnerabilities—many of which may be linked to outdated or insufficiently responsive planning frameworks. In this light, a policy of deferring compliance with the PENCAS Act risks perpetuating land use decisions that fail to reflect environmental constraints and hazard realities. This, in turn, increases foreseeable risk and undermines the duty of planning authorities to align land use regulation with existing legal mandates and evolving environmental conditions.
4. Distinction Between Full Implementation and Minimum Compliance
Full technical implementation may await standardized systems, but minimum transitional compliance is feasible now using available tools like hazard mapping, watershed delineation, and environmental constraints analysis. Ecological limits can thus inform planning without full PENCAS operationalization.
5. Request for Clarification
In view of the above, I respectfully seek clarification on:
i. Whether DHSUD plans to approve CLUPs omitting PENCAS requirements;
ii. Whether interim or minimum compliance measures apply to LGUs pending full PENCAS rollout; and
iii. Whether the Department contemplates transitional guidelines to align current planning with legal mandates.
6. Reservation of Rights
This letter is without prejudice to further actions to ensure land use planning complies with the law and addresses environmental and developmental imperatives.
7. Closing
My intent is not to hinder planning but to affirm that natural capital integration is now a legal imperative, not mere policy.
Every day in Cebu, the equivalent of 500 dump trucks of limestone leaves the province’s quarry sites. Over a year, that amounts to roughly 3.6 million tons of limestone—enough trucks lined up bumper to bumper to stretch from Cebu to Manila and back.
Yet a recent tax dispute between the Province of Cebu and Apo Land and Quarry Corporation ended with a compromise settlement of Php211.56 million, far lower than the original Php1.218 billion assessment. The tax dispute arose from differing interpretations of the province’s authority to impose quarry extraction taxes.
At first glance, the reduction appears dramatic. But the outcome reflects an important legal reality: the taxing powers of local governments are limited by national law and Supreme Court jurisprudence.
Understanding the Apo quarry case therefore, requires looking beyond the headline numbers. It reveals how law, economics, and natural resource governance intersect in a rapidly developing province like Cebu.
According to reports, the Province of Cebu initially assessed Apo Land and Quarry Corporation approximately Php1.218 billion in quarry-related taxes, fees, penalties, and interest covering operations from around 2006 to 2022. After legal review, the assessment was recalculated and reduced to a proposed Php211.56 million compromise settlement, leaving a difference of roughly Php1.006 billion. When this proposed settlement is spread across the coverage period, the provincial recovery corresponds to roughly Php13.2 million per year. The compromise, however, is not yet final and is currently under review by the Cebu Provincial Board, which must decide whether the negotiated settlement should be approved.
The Cebu Quarry Ledger
One way to understand the Apo quarry case is to view it through a simple economic ledger that compares physical extraction, economic value, and fiscal recovery.
Category
Indicator
Approximate Value
Physical extraction
Limestone production
~3.6 million tons per year
Logistics equivalent
Dump truck loads
~180,000 trucks per year
Daily extraction
Truck equivalent
~500 trucks per day
Production value
Quarry output
~₱225 million per year
Provincial recovery
Settlement equivalent
~₱13.2 million per year
Fiscal capture ratio
Provincial share
~6%
The reduction of the assessment was largely driven by the legal limits of provincial taxation powers. Provincial governments derive their authority to levy quarry taxes from the Local Government Code of 1991, which allows provinces to impose taxes on sand, gravel, and other quarry resources extracted from public lands or public waters. Apo Land and Quarry Corporation operates limestone quarries under Mineral Production Sharing Agreements (MPSAs) issued by the national government pursuant to the Philippine Mining Act of 1995. The Supreme Court clarified the limits of provincial quarry taxation in Province of Bulacan v. Court of Appeals (G.R. No. 126232, 1998), ruling that provinces cannot impose quarry extraction taxes on minerals extracted from private lands covered by mining agreements. Because part of the original Cebu assessment involved such extraction taxes, those components could not be legally sustained. Once they were removed, the remaining obligations consisted mainly of monitoring fees, environmental charges, penalties, and interest.
To appreciate the scale of quarry operations in Cebu, it helps to examine limestone production data. According to records of the Mines and Geosciences Bureau, Cebu produces roughly 3.6 million metric tons of limestone annually. Production reached about 3.91 million tons in 2022, 3.47 million tons in 2023, and 3.62 million tons in 2024, for a total of roughly 11 million tons of limestone extracted over three years.
Apo’s reported production value has been approximately:
Php225 million per year.
Compared with the provincial recovery under the proposed settlement:
Indicator
Amount
Annual production value
~Php225 million
Average provincial recovery
~Php13.2 million
Estimated fiscal capture
~6%
It should be noted that other taxes—such as corporate income tax and excise tax on minerals—are collected by the national government, not by the province.
The Apo case highlights a structural feature of Philippine resource governance.
Numbers of this scale can be difficult to visualize. If a typical quarry dump truck carries 20 tons of limestone, Cebu’s annual limestone production would require approximately 180,000 truckloads per year. Spread across the year, this corresponds to roughly 500 dump trucks of limestone leaving quarry sites every single day. If these trucks were lined up bumper to bumper, the line would stretch approximately 1,440 kilometers, roughly the distance from Cebu to Manila and back.
The production value associated with these operations is also significant. Apo’s reported quarry production value has been approximately Php225 million annually. When compared with the proposed provincial recovery under the compromise settlement—about Php13.2 million per year—the province’s fiscal capture represents roughly six percent of the reported production value. It should be noted, however, that other taxes such as corporate income taxes and mineral excise taxes are collected by the national government, not by the province.
The Apo case illustrates a structural feature of Philippine resource governance. Mineral resources are owned by the State and administered by the national government through mining agreements and permits. While extraction activities occur within provinces and municipalities and may have local environmental and land-use implications, the authority to regulate mining operations and collect major fiscal revenues largely rests with the national government. As a result, extraction occurs locally, environmental impacts are experienced locally, but taxation authority may be limited locally.
The compromise settlement in the Apo case therefore highlights a broader issue in how the economic value of natural resources is measured and governed. Taxes capture only part of the economic activity associated with extraction, and they often do not reflect the environmental systems that support development. This is precisely the gap addressed by the Philippine Ecosystem and Natural Capital Accounting System Act, which institutionalizes ecosystem and natural capital accounting in the Philippines. Natural capital accounting provides a framework for recognizing ecosystems—such as watersheds, forests, and karst landscapes—as economic assets that contribute to long-term development.
For provinces like Cebu, where quarrying occurs in upland landscapes and watershed areas, natural capital accounting can provide a more comprehensive understanding of the economic context in which resource extraction takes place. While taxation remains an important fiscal tool, ecosystem accounting helps policymakers recognize the value of environmental systems that sustain communities and economic activity.
As the Provincial Board reviews the proposed compromise settlement, the decision involves more than simply approving a negotiated amount. The board must weigh the legal sustainability of the original assessment, the fiscal risks of continued litigation, the potential precedent that a settlement may create for other cases, and the broader need to strengthen governance of natural resources within the province.
The Apo quarry tax case is therefore not merely about the reduction of a tax assessment from Php1.218 billion to Php211 million. It reflects the complex interaction between national control of mineral resources and local responsibility for land use and environmental management. As Cebu continues to grow as an economic center in the Visayas, the challenge will be to ensure that resource extraction contributes to development while maintaining responsible stewardship of the landscapes that sustain communities and ecosystems.
The lesson of the Apo case is that while taxes measure the revenue generated from extraction, natural capital accounting helps us understand the value of the landscapes from which those resources are taken.
The dynamics of quarry extraction also raise a broader political-economic question. While limestone extraction generates private economic returns for firms and supports industrial production, the environmental risks associated with landscape modification—such as altered drainage patterns, erosion, and increased flood vulnerability—are often experienced downstream. In many resource economies, economic gains from extraction are concentrated at the site of production, whereas environmental risks, such as flooding, may be borne by downstream communities.
This article analyzes publicly available information and policy issues related to quarry governance and natural capital.
Today, I attended a meeting where solid waste disposal finally took center stage. At one point, a lawyer asked me a direct question: If we are against the use of Binaliw as the city’s final disposal site, then where should Cebu put its waste?
I was a bit surprised—not because the question was hostile, but because it reflected a familiar assumption in our planning conversations: that an unsafe site somehow becomes acceptable simply because there is no immediate alternative.
My response was straightforward. If Binaliw is geologically unsafe, environmentally prohibited, or legally non-compliant, then it must be closed or phased out—even if there is no instant replacement yet. The absence of an alternative does not legalize a dangerous site. It only exposes the failure of long-term planning.
That exchange captures the heart of Cebu’s waste dilemma. We are repeatedly forced to choose between maintaining a risky status quo and confronting the harder task of planning properly. In truth, solid waste disposal is not merely an operational problem—it is a land-use problem. And unless it is clearly integrated into the city’s Comprehensive Land Use Plan (CLUP), we will keep asking the same question every time a crisis occurs: If not here, then where?
Waste Is Not a Side Issue. It Is a Planning Constraint.
Every land-use decision produces waste. Higher density means more garbage. Commercial expansion means more packaging waste. Mixed-use zones mean round-the-clock waste generation.
Despite this, solid waste management in Cebu has often been treated as a sectoral concern, discussed in a separate plan, handled by a different office, and enforced at the barangay level—while the CLUP proceeds as if waste were invisible.
This separation is a fundamental planning error.
Under Philippine planning law, solid waste is not optional, operational, or secondary. It is a land-use issue that must be integrated into the CLUP itself.
What the Law Already Recognizes
Republic Act No. 9003, the Ecological Solid Waste Management Act, is explicit: solid waste management must be integrated into local development and land-use planning.
This is not theoretical. The Department of Human Settlements and Urban Development (DHSUD) enforces this principle every day.
A subdivision cannot be approved without:
a Materials Recovery Facility (MRF),
a waste management plan,
and a clear disposal arrangement.
If DHSUD requires this level of scrutiny for a single subdivision, then it follows logically—and legally—that a city-wide CLUP must meet a higher standard, not a lower one.
Yet many CLUPs, including Cebu’s, expand urban development without clearly mapping:
where MRFs will be located,
where transfer and processing facilities will go,
how buffer zones will be enforced,
or how increased waste volumes will be safely handled.
The Inayawan Closure and the Illusion of Disposal
Cebu City once relied on the Inayawan Sanitary Landfill. That facility is now closed following environmental and legal challenges.
What replaced it is not a new landfill within the city—but dependence on external disposal arrangements.
There is nothing inherently wrong with regional disposal. In fact, for a dense island city like Cebu, regional solutions often make sense.
But here is the planning problem:
The CLUP does not clearly acknowledge or spatially integrate this dependency.
If waste is transported out of the city, the CLUP must still plan for:
transfer stations,
waste logistics corridors,
processing and diversion facilities,
environmental safeguards along the way.
Ignoring these realities does not make them disappear. It simply pushes them into unsafe locations.
Binaliw and the Cost of Planning Silence
The presence of waste-related facilities in upland barangays like Binaliw—and the landslide incidents associated with them—should be a wake-up call.
These are not isolated operational failures. They are predictable outcomes of weak land-use integration.
RA 9003 prohibits waste facilities in environmentally critical and geologically unstable areas. Cebu’s own studies identify upland zones as landslide-prone and ecologically sensitive.
When waste facilities end up there, it is not because the law is unclear. It is because the CLUP failed to make waste a binding spatial constraint.
Barangay Conflicts Are Symptoms, Not Causes
Recent disputes between barangays and City Hall over waste segregation and collection protocols highlight another consequence of poor integration.
Barangays are asked to enforce “no segregation, no collection” policies—but without:
sufficient MRFs,
zoning support,
land reserved for facilities,
or clear citywide spatial guidance.
This creates friction, confusion, and inconsistent enforcement. It also undermines public trust.
A CLUP that integrates waste properly does not leave barangays to improvise. It provides spatial clarity and institutional backing.
Regional Solutions Require Local Responsibility
Some argue that final disposal should be regional, not city-based. That may be true.
But regional scale does not excuse local planning.
Even if the landfill or waste-to-energy facility is outside Cebu City, the CLUP must still:
prohibit unsafe siting within the city,
reserve land for waste processing and transfer,
link development intensity to waste system capacity,
and protect watersheds and communities from downstream impacts.
Planning ends not at jurisdictional boundaries, but at impact pathways.
The Real Question the CLUP Must Answer
A credible CLUP must be able to answer this simple question:
As Cebu grows denser and more complex, where—and how—will its waste be safely managed?
If that answer is not visible on the zoning map, then the plan is incomplete.
Urban resilience is not built only with roads and buildings. It is built by managing what cities produce—especially what they discard.
Closing Thought
Garbage is not glamorous. It does not attract investors or ribbon cuttings. But it is one of the most honest indicators of whether a city’s planning is grounded in reality.
If waste management is mandatory at the subdivision level, it must be central at the city level.
Because in the end, a land-use plan that cannot account for its waste is not planning for sustainability—it is planning for crisis.
Urban land use planning in Cebu City cannot be treated as a purely local spatial exercise. As the primary economic anchor of Central Visayas (Region VII), Cebu City performs metropolitan and regional functions that extend far beyond its administrative boundaries — economically, socially, and spatially.
Cebu City in the Regional Economic Structure
Central Visayas remains one of the fastest-growing regional economies in the Philippines. In 2024, the region’s gross regional domestic product (GRDP) reached about ₱1.28 trillion, expanding at 7.3 percent — higher than the national average — and maintaining its position as the largest economy in Visayas and Mindanao.
Within this context, Cebu City continues to serve as the regional engine:
In 2024, Cebu City’s economy expanded by about 7 percent, with a total output of roughly ₱334.48 billion, driven by trade, finance, and professional services.
According to recent Provincial Product Accounts, Cebu City accounted for about 22.6 percent of Central Visayas’ regional economy in 2023, second only to the entire Province of Cebu.
Cebu City’s economic footprint is not contained within city boundaries: it affects employment patterns, investment flows, infrastructure utilization, and land markets across multiple provinces and cities in the region.
Zoning as a Regional Economic Decision
Urban economic theory explains that development rights — created and modified by zoning — are capitalized into land values and development incentives.
In Cebu City:
The IT Park–Lahug corridor drives strong agglomeration effects.
The CBD–Port core remains a critical commercial and logistics hub.
The South Road Properties (SRP) influence is reshaping coastal development patterns.
Fringe and upland barangays are facing conversion pressures with implications for peri-urban growth.
These dynamics produce a complex land value gradient that must be recognized and regulated in the CLUP.
Regional Spillover Effects
When land values in Cebu City rise due to zoning changes, the pressure is felt in neighboring LGUs:
Housing demand spills over into Consolacion, Lilo-an, and Talisay.
Commuter flows cross city boundaries, stressing transport corridors.
Agricultural land conversion accelerates in fringe municipalities.
This illustrates that Cebu City’s land use decisions are not isolated. They shape regional patterns of growth and require a planning perspective consistent with broader regional development strategies — including the Central Visayas Regional Development Plan.
Why RLUC and DHSUD Review Cebu City’s CLUP
The institutional review structure reflects this regional reality.
The Regional Land Use Committee (RLUC), operating within the regional planning structure of the Department of Economy, Planning, and Development (DEPDev), conducts technical assessment of CLUPs to ensure consistency with regional spatial strategy and economic coherence.
Meanwhile, the Department of Human Settlements and Urban Development (DHSUD) serves as the national approving authority — guaranteeing alignment with national urban development policy, hazard integration, infrastructure standards, and housing obligations.
This layered review is not bureaucratic duplication. It is recognition that Cebu City’s land use decisions have regional repercussions, and thus must be evaluated not only for local coherence but for their impact across the metropolitan and regional system.
Infrastructure and Fiscal Discipline
Allowing density increases without aligning them with infrastructure capacity produces:
Higher capital expenditure demands
Road and drainage system overload
Greater disaster risk exposure
A responsible CLUP must factor in not just spatial demand but also infrastructure load-testing and projected fiscal impact. Growth may increase revenue — but it may also create unfunded liabilities if infrastructure and risk costs are excluded from the analysis.
Climate Risk as an Economic Variable
Hazard-prone areas — floodplains, landslide slopes, coastal lowlands — are not merely environmental concerns. They are economic risk multipliers that, if developed without restraint, impose long-term costs on public budgets and private livelihoods.
To address this, the CLUP must define:
Net Developable Land = Gross Land – Hazard Constraints – Easements – Protected Zones
This adjusted baseline must inform density decisions.
Housing Affordability and Land Cost Capitalization
In high-demand corridors of Cebu City, land cost often represents a major portion of overall housing price. If land value increases faster than housing supply expands, zoning changes alone will not yield affordability — they may worsen it.
This underscores the need for inclusionary mechanisms and spatial strategies that place housing close to jobs, infrastructure, and hazard-safe areas.
Cebu City as Metropolitan Steward
The CLUP of Cebu City must operate as:
A regulator of land value winds
A coordinator of infrastructure investments
A climate risk filter
A promoter of equitable housing outcomes
A mediator of regional economic stability
When Cebu City adjusts density and land use rules, the regional economy adjusts with it.
Planning for Value and Region
Cebu City’s CLUP must transcend the narrow framing of zoning colors on paper. It must be anchored in land economics and regional economic logic — because spatial decisions in this city do not stay within its borders. They shape the future of Central Visayas and influence conditions well beyond.
When we speak about Carbon Market, the conversation is often framed as a city-level redevelopment issue. But from an economist’s and urban planner’s perspective, that framing is incomplete.
Carbon Market is not just a Cebu City asset. It is a regional economic node embedded within:
The Cebu City Comprehensive Land Use Plan (CLUP)
The broader Central Visayas food system
Inter-municipal agricultural and fisheries value chains
Understanding this connection is essential. Because what happens in Carbon Market does not stay in Carbon Market.If the Cebu City CLUP provides the spatial framework within the city, regional development provides the functional framework beyond it.
Carbon Market does not operate within the administrative boundaries of Cebu City alone. Its economic reach extends to:
Vegetable-producing upland municipalities
Coastal fishing communities
Neighboring provinces supplying agricultural and marine products
Informal and micro-enterprise processors embedded in peri-urban zones
In regional economic terms, Carbon Market is a growth linkage node. It performs three critical functions:
Market Access for Peripheral Producers
Regional development theory emphasizes that urban centers must provide stable demand anchors for rural economies. Without reliable access to urban markets, smallholder farmers and fishers face:
Price instability
Dependence on trader-lenders
Higher transaction costs
Reduced bargaining power
Carbon Market shortens this chain. It allows producers from outside Cebu City to plug directly into an urban demand center with high turnover and price transparency.
Weakening that node without creating an equivalent alternative risks pushing producers back into fragmented, less competitive arrangements — deepening regional inequality rather than reducing it.
Cost Distribution Across the Region
When a central distribution hub functions efficiently, it:
Reduces duplication of logistics
Concentrates transport routes
Facilitates bulk aggregation
Lowers spoilage rates
Research on vegetable supply chain losses in Central Philippines shows that inefficiencies in aggregation and storage significantly increase losses before produce reaches consumers. Likewise, studies on Cebu’s fish trade highlight how centralized nodes stabilize pricing and reduce uncertainty in time-sensitive transactions.
If Carbon Market’s role as a distribution hub diminishes, costs do not disappear — they are redistributed. Often, they shift:
Upstream to producers (lower farmgate prices)
Downstream to consumers (higher retail prices)
Outward to peripheral municipalities (logistics strain)
Regional development is not simply about growth. It is about where costs and benefits are spatially allocated.
Urban–Rural Integration
The Cebu City CLUP governs land within the city. But urban land-use decisions influence regional integration.
A well-functioning urban core should:
Complement rural production
Support peri-urban logistics
Serve as an accessible convergence point
Carbon Market historically performs this integrative function. It is a bridge — not a barrier — between rural supply and urban consumption.
If the urban core shifts toward higher-value commercial uses without preserving essential economic infrastructure, the result is functional displacement. Wholesale and distribution activities may be pushed outward into areas less prepared to handle them, increasing congestion, transport time, and land-use conflict.
From a regional planning standpoint, that is inefficiency — not progress.
Resilience Beyond Boundaries
The CLUP incorporates resilience planning within city limits. But food systems operate regionally.
During typhoons, port disruptions, or fuel shocks, centralized and accessible aggregation points allow for rapid redistribution and emergency coordination.
Carbon Market enhances:
Supply continuity
Rapid turnover of perishable goods
Network density among traders and suppliers
If that density fragments, regional resilience weakens.
In a climate-vulnerable region like Central Visayas, food-system stability is not optional. It is structural.
The Regional Development Question
Urban redevelopment often focuses on maximizing land value within city boundaries. But regional development asks a broader question:
Does this spatial change strengthen or weaken urban–rural economic integration?
Carbon Market is not simply an asset of Cebu City. It is a component of Central Visayas’ food economy.
Modernization is possible — even necessary. But modernization must:
Preserve small-producer access
Maintain low transaction costs
Strengthen logistics efficiency
Protect affordability for consumers
Align with the CLUP’s structural intent
Support inclusive regional growth
Otherwise, a local land-use adjustment may unintentionally generate regional economic imbalance.
Planning as System Stewardship
Planning is not merely about zoning compliance or real estate optimization.
It is about system stewardship.
Carbon Market sits at the intersection of:
Land-use planning (CLUP)
Inclusive value-chain development
Regional economic integration
Food-system resilience
Spatial equity
Understanding it as regional infrastructure — not merely local property — allows Cebu to evolve without destabilizing the very economic networks that sustain it.
Author’s Note
Agosto is an economist and urban planner, and a practicing real estate professional whose work examines land-use governance, market institutions, and regional economic systems. His analyses engage the Cebu City Comprehensive Land Use Plan (CLUP) in relation to public markets, food-system resilience, and inclusive regional development in Central Visayas.
When the Binaliw landfill collapsed on January 8, killing at least 36 people, the tragedy did not end with the recovery of bodies. It deepened when environmental regulators appeared before the Cebu City Council and admitted they had “no answers” on regulatory compliance, monitoring, or enforcement.
In environmental governance, the absence of answers after a mass-casualty disaster is not neutral—it is incriminating. It reveals that the systems meant to protect life and the environment were either ignored, unenforced, or reduced to paperwork long before the collapse occurred.
The Moment Accountability Collapsed
The Cebu City Council hearing was supposed to clarify what went wrong. Councilors asked basic questions any regulator must be able to answer after a disaster of this magnitude:
Was the landfill operating in compliance with its Environmental Compliance Certificate (ECC)?
Were inspections conducted?
Were geotechnical risks evaluated?
Were warning signs detected and acted upon?
The response—by the regulators’ own admission—was that they had no clear answers.
That moment matters more than any press release or leadership change. When agencies tasked with protecting life and the environment cannot explain how a regulated facility failed so catastrophically, the problem is no longer technical. It is institutional failure.
This Was Foreseen—And Documented
Binaliw did not fail in ignorance.
As early as 2015, the JICA Roadmap for Solid Waste Management in Metro Cebu warned against continued reliance on upland landfills, citing slope instability, environmental limits, and disaster risk. It called for reducing pressure on upland sites and transitioning to safer, metropolitan systems—treating upland facilities as temporary, not permanent infrastructure.
Nearly a decade later, Cebu remained dependent on upland disposal—turning a stopgap into a structural risk. What happened followed the very chain JICA warned about:
In fact, the Mines and Geosciences Bureau Region VII conducted detailed geohazard mapping in 2012, later validated in 2013, which identified multiple sitios in Barangay Binaliw — including Sitio Binaliw 3, Mansawa, and Campo — as highly susceptible to landslides due to steep slopes and unstable geology. MGB geologists not only flagged these risks but also advised communities to avoid the area until it was declared stable. Despite this documented vulnerability, such geotechnical warnings did not translate into meaningful land-use controls, zoning restrictions, or regulatory limits on waste facility siting.
A Pattern of Unanswered Environmental Risks in Central Visayas
Binaliw is not an isolated failure. It is part of a pattern of unresolved environmental risks across Central Visayas, where hazards were known, documented, and repeatedly raised—yet left inadequately addressed.
Across the region, the same warning signs have appeared again and again:
Upland and hillside developments, where cumulative slope modification, altered drainage, and increased runoff proceeded without adequate assessment of combined, long-term impacts;
Recurring flooding, increasingly tied to watershed degradation and land-use decisions that ignored natural drainage and topographic limits;
Liquid waste incidents, most notably the industrial wastewater spill in Bais City that contaminated the protected Tañon Strait, triggered fishing bans, and led to a declaration of calamity—exposing gaps in monitoring, containment, and emergency response;
Persistent community complaints about foul odors, leachate seepage, and water contamination near waste facilities—complaints that accumulated but failed to prompt decisive enforcement.
In each case, the laws existed.
The plans were written.
The risks were identified.
What was missing was not policy—but decisive, transparent implementation, sustained enforcement, and—critically—the ability of institutions to explain their actions when things went wrong.
Binaliw did not expose a lack of knowledge. It exposed a failure to act on knowledge.
Why “No Answers” Is the Real Scandal
The most disturbing aspect of the Council hearing was not disagreement—it was silence.
Regulatory agencies exist to anticipate risk, enforce safeguards, and account for decisions when harm occurs. When they cannot do so after dozens of deaths, public trust collapses—and rightly so.
Leadership changes in the DENR may follow, but they are a response to lost credibility, not its resolution. Accountability does not begin with reshuffling names. It begins with answers.
Engineering Cannot Override Geography
One hard truth emerges from Binaliw:
No engineering solution can fully overcome a fundamentally unsafe upland location. No permit can substitute for ecological limits.
This is not ideology; it is geotechnics and hydrology. Ignoring CLUP cautions and JICA warnings does not make development safer—it postpones the consequences.
The withdrawal of SM Prime Holdings from the proposed public market redevelopment in Baguio City has often been framed as a failed deal or a breakdown in negotiations. In truth, it offers a far more instructive lesson—one rooted in contract law, urban planning, and the statutory nature of public markets. It shows how freedom of contract, when confronted with planning policy and public welfare, is legally designed to yield.
At the center of this lesson is Article 1306 of the Civil Code, which enshrines freedom of contract but only within firm boundaries. Parties may stipulate as they see fit, but only so long as their agreements are not contrary to law, morals, good customs, public order, or public policy. This conditional structure matters greatly in contracts that affect public interest. Public market redevelopment is one such contract.
Public markets are not ordinary commercial properties. Under Section 17(b)(2)(viii) of the Local Government Code (RA 7160), public markets are expressly classified as basic services, on the same statutory footing as health and welfare facilities. This classification is decisive. Once an activity is defined as a basic service, it cannot be governed solely by profit logic or treated like a private mall. The law itself embeds a social function into the space.
The Local Government Code reinforces this social character through the general welfare clause in Section 16, which authorizes local governments to exercise police power to promote public welfare, social justice, and economic stability. This power includes regulating stall rentals, fees, access, and conditions of use in public markets—even when a private entity is involved through a public–private partnership. Sections 147 and 151 further authorize LGUs to impose reasonable fees and charges, a standard that is explicitly normative, not market-driven. Reasonableness is measured against livelihood capacity and public welfare, not revenue maximization.
When these statutory provisions are read together with Article 1306, the legal architecture becomes clear. Freedom of contract exists, but only within a planning and policy framework already defined by law. Contracts governing public markets are therefore not insulated private arrangements. They are subordinate to public policy as articulated in statutes, urban plans, and zoning ordinances.
In Baguio’s case, the public market has long functioned as a livelihood hub and cultural anchor. Planning objectives—affordability, protection of long-time vendors, and preservation of the market’s public character—were not incidental concerns raised late in the process. They are inherent in how the space is planned and governed. Once these planning constraints were asserted, the scope of permissible contractual discretion narrowed, exactly as Article 1306 anticipates.
From a legal standpoint, SM Prime’s withdrawal was not a failure of freedom of contract. It was a recognition of its limits. Article 1306 does not guarantee that a contract affecting public interest will remain commercially viable under all conditions. It guarantees only that parties may contract subject to existing and continuing public policy constraints. When those constraints—rooted in the Local Government Code and the city’s planning framework—made mall-type economics incompatible with the social function of the public market, withdrawal became the lawful and rational outcome.
This dynamic carries important implications for other cities contemplating similar redevelopments. In places like Cebu, where public markets are likewise embedded in CLUPs and governed by zoning ordinances, contracts cannot be used to bypass planning intent or displace intended beneficiaries through pricing and access mechanisms. Article 1306 ensures that contractual autonomy remains a tool for implementing urban policy, not a mechanism for undoing it.
Ultimately, the Baguio market episode affirms a principle that is often overlooked in infrastructure and redevelopment debates: not all urban spaces are meant to behave like malls. Public markets are planned spaces with statutory social functions. When private contracts collide with those functions, the law does not bend planning to contract. It bends contract to the plan. That is not an aberration in the legal system—it is the system working exactly as designed.
In this sense, the Baguio case demonstrates that Article 1306 does not guarantee the profitability or finality of a public-market contract. What it guarantees is a framework within which private agreement must remain aligned with law and public policy. When alignment becomes impossible—when the commercial model required by the private party cannot coexist with the social function of the public market—the legally correct outcome is not coercive enforcement, but withdrawal.
This dynamic is precisely why the Baguio withdrawal is instructive for other public market projects. It shows that contracts over public markets survive only if contractual autonomy serves, rather than defeats, livelihood, equity, and the common good. Article 1306 does not compel private parties to stay in such contracts at all costs; it simply ensures that they cannot insist on terms that override public policy. Where those terms are essential to the private party’s participation, exit becomes the lawful and rational option.
Seen this way, the Baguio market episode is not an anomaly. It is a practical manifestation of Article 1306’s deeper logic: freedom of contract exists, but in public-interest settings, it yields to social regulation—and when that yield is too great for commercial viability, withdrawal is the system working as designed, not failing.
How CLUPs and Zoning Ordinances Set the Real Limits of Freedom of Contract
Urban planning gives concrete institutional form to the limits that Article 1306 places on contractual autonomy, and this is most clearly expressed through the Comprehensive Land Use Plan (CLUP) and the Zoning Ordinance. These planning instruments are not merely technical documents; they are the local government’s formal articulation of public policy in space. When a contract concerns land or facilities governed by an approved CLUP and zoning ordinance, the contract does not operate above these instruments—it operates within them.
Under Philippine planning law and practice, the CLUP establishes the intended social, economic, and spatial function of land. Zoning then translates that intent into binding regulatory controls on use, intensity, and character of development. When a public market is designated in the CLUP as a civic, institutional, or special commercial use—particularly one oriented toward livelihood and public service—that designation carries legal consequences. It signals that the area is not meant to function as a purely market-driven commercial zone akin to a mall district. Instead, it is planned as livelihood infrastructure, embedded in the city’s social economy.
This is where Article 1306 and planning law converge. Article 1306 allows parties to stipulate freely, but only so long as those stipulations are not contrary to law or public policy. In the urban planning context, the CLUP and zoning ordinance are the most authoritative local expressions of public policy. A redevelopment contract that effectively transforms a public market—planned and zoned as a socially oriented urban facility—into a space governed by mall-type economics may comply with the text of the contract, yet still conflict with the CLUP’s planning intent. When that happens, Article 1306 ceases to protect contractual discretion and instead becomes the legal basis for regulation, recalibration, or even non-continuance of the agreement.
The Baguio public market episode illustrates this clearly. While the proposed contract with SM Prime Holdings may have been commercially sound, it ran into a planning reality grounded in Baguio City’s land-use objectives. The public market’s role in the city’s CLUP—as a livelihood hub, cultural space, and civic anchor—meant that zoning and planning policies necessarily imposed limits on rental structures, vendor displacement, and land-use intensity. Once the city asserted these planning constraints, the contract could no longer be treated as a purely private commercial arrangement. Under Article 1306, stipulations inconsistent with those planning objectives lost their normative force.
From an urban planning standpoint, this outcome is not accidental; it is structural. CLUP and zoning compliance function as ex ante filters on what kinds of contracts are viable in particular locations. They ensure that cities do not contract away their planning mandate through long-term agreements that lock in spatial outcomes contrary to adopted plans. Article 1306 provides the legal bridge that makes this possible by subordinating contractual freedom to public policy as expressed through planning instruments.
This has important implications for other cities contemplating public market redevelopment, including Cebu City. If the CLUP and zoning ordinance characterize Carbon Market as a public market, special commercial zone, or civic space with explicit livelihood and social functions, then any PPP or joint venture must be interpreted—and if necessary, regulated—through that planning lens. Contracts cannot be used to bypass zoning intent, intensify commercial use beyond what the CLUP envisions, or displace intended beneficiaries without violating public policy. When conflicts arise, Article 1306 does not protect the contract; it protects the plan.
In this sense, CLUP and zoning compliance are not secondary considerations that follow contract execution. They are preconditions that define the legal environment in which contracts operate. The Baguio withdrawal shows that when planning objectives are clear and consistently enforced, private parties make rational decisions: they either adapt their contractual expectations to the plan or withdraw. Both outcomes preserve the integrity of the planning system.
Ultimately, the lesson for urban governance is clear. Planning leads; contracts follow. Article 1306 ensures that freedom of contract remains a tool for implementing the CLUP, not a mechanism for undoing it. When cities take their planning instruments seriously, contractual autonomy aligns with urban policy—or yields to it.
