National Transmission Corp. v. Heirs of Marasigan

FIRST DIVISION

[G.R. No. 243076. May 14, 2021.]

NATIONAL TRANSMISSION CORPORATION, petitioner, vs. HEIRS OF ANTONIO MARASIGAN, namely: LEONARDO MARASIGAN, CRISOSTOMO MARASIGAN, and MATILDE MARASIGAN, represented by MATILDE MARASIGAN; HEIRS OF SPOUSES VICENTE CABRAL and JUSTINA PANGANIBAN; and HEIRS OF ROMEO T. MENDOZA, represented by LORETA A. MENDOZA, respondents.

NOTICE

Sirs/Mesdames :

Please take notice that the Court, Second Division, issued a Resolution dated May 14, 2021 which reads as follows:

"G.R. No. 243076 (National Transmission Corporation v. Heirs of Antonio Marasigan, namely: Leonardo Marasigan, Crisostomo Marasigan, and Matilde Marasigan, represented by Matilde Marasigan; Heirs of Spouses Vicente Cabral and Justina Panganiban; and Heirs of Romeo T. Mendoza, represented by Loreta A. Mendoza).

This is an appeal from the February 20, 2018 Decision 1 and October 17, 2018 Resolution 2 issued by the Court of Appeals (CA) in CA-G.R. CV No. 104259, which affirmed the December 27, 2013 Decision 3 of the Regional Trial Court of Pallocan West, Batangas City, Branch 8 (RTC), requiring National Transmission Corporation (petitioner) to pay Heirs of Antonio Marasigan, namely: Leonardo Marasigan, Crisostomo Marasigan, and Matilde Marasigan, represented by Matilde Marasigan; Heirs of Spouses Vicente Cabral and Justina Panganiban; and Heirs of Romeo T. Mendoza, represented by Loreta A. Mendoza (respondents) just compensation for the entirety of their respective landholdings and not just for the expropriated area.

On July 31, 2000, the National Power Corporation (NPC) filed a Complaint 4 for eminent domain with the RTC. The complaint alleged that in view of the construction of the San Pascual Cogeneration Transmission Line Project, it is necessary and urgent for NPC to acquire an easement of right-of-way over portions of the parcels of land owned by respondents comprising a total area of 11,915 square meters. Later, with leave of court, NPC filed an Amended Complaint, 5 reducing the area sought to be acquired as right-of-way to 6,235 sq. m. 6

On December 11, 2003, the RTC issued an Order of Expropriation. 7 It stated that respondents had no objection to the expropriation of their properties for the construction and maintenance of the San Pascual Cogeneration Transmission Line Project, a project for public purpose. Moreover, it declared NPC to have a lawful right to expropriate respondents' properties, subject to payment of just compensation to be determined by three commissioners to be appointed by the court. The members of the Board of Commissioners (BOC) were subsequently appointed. 8 They rendered their Commissioner's Report 9 dated November 12, 2012, recommending the payment of P130.00 per sq. m. as just compensation for the affected portions of respondents' properties, with legal interest at 6% per annum reckoned from the filing of the complaint.

On December 27, 2013, the RTC rendered its Decision. It sustained the BOC-recommended just compensation in the amount of P130.00 with legal interest, which it held to have also been accepted by the parties. The RTC also required NPC to pay respondents the full value of the property, not only the easement fee, and to pay just compensation on the entire land areas owned by respondents, not only on the portions affected by the easement of right-of-way, supposedly on the basis of the Court's ruling in National Power Corporation v. Manubay Agro-Industrial Development Corporation (Manubay). 10 The dispositive portion of the RTC decision states:

WHEREFORE, the plaintiff National Power Corporation (now National Transmission Corporation) has to pay:

1) the Heirs of Antonio Marasigan for the entire area of 10,984 sq. meters at Php130 per square meter plus interest of 6% per annum from the time of the filing of the complaint up to the time the payment of the value of the land is completed;

2) the Heirs of Spouses Vicente Cabral and Justina Panganiban for the whole area of 10,342 sq. meters at Php130 per square meter plus interest of 6% per annum from the time of the filing of the complaint up to the time the payment of the value of the land is completed; and

3) the Heirs of Romeo T. Mendoza, represented by Loreta A. Mendoza for the whole area of 745 square meters at Php130 per square meter plus interest of 6% per annum from the time of the filing of the complaint up to the time the payment of the value of the land is completed.

SO ORDERED. 11

Petitioner 12 filed a Motion for Reconsideration, 13 arguing that it should be required to pay just compensation only for the portion of respondents' properties that would be traversed by the transmission lines. It emphasized that for the heirs of Antonio Marasigan, the affected area is only 2,210 sq. m. out of their 10,984 sq. m. landholding. For the heirs of Vicente Cabral, only 3,280 sq. m. would be taken out of their 10,342 sq. m. landholding. Petitioner maintained that these respondents may still utilize the remaining portion of their properties.

The motion, however, failed to convince the RTC. Hence, petitioner was compelled to seek recourse with the CA.

On February 20, 2018, the CA rendered its assailed Decision which affirmed the decision of the RTC. It held that the pivotal issue in the appeal is whether respondents "are entitled to just compensation for the entire valuation of the properties, or only for easement fees representing the portion of the properties actually necessary for the installation of the Transmission Line Project." 14 The CA found no basis to deviate from the ruling in Manubay, which it observed contained factual circumstances and issues that are substantially similar to those obtaining in the appeal. Pertinent portions of the decision state:

We apply the [ruling in Manubay] in this case. To emphasize, the land owners are deprived of the beneficial use and enjoyment of the rest of the portion of the property, including even those that are not directly affected by the Transmission Line Project, because of the nature and effect of the installation of power lines. It is for this reason that the NTC must pay the entire value of the properties owned by the heirs of Marasigan, et al. and not just the easement fees for the land directly affected by the Transmission Line Project. Accordingly, the NTC's contention that it cannot validly expropriate the remaining portion of the properties cannot be sustained.

We also brush aside NTC's argument that expropriating the entire area of the properties owned by the heirs of Marasigan, et al., would amount to an unwarranted dissipation of public funds. To reiterate, the construction and maintenance of the Transmission Line Project would impose a limitation on the use of the land for an indefinite period of time, thereby justifying the payment of the full value of the properties. Consequently, there is no undue payment of public funds. 15

The dispositive portion of the CA decision states:

WHEREFORE, the appeal is DENIED. The Decision dated December 27, 2013 and Resolution dated August 19, 2014 of Branch 8 of the Regional Trial Court of Pallocan West, Batangas City in Civil Case No. 5710 are AFFIRMED.

SO ORDERED. 16

Petitioner's motion for reconsideration having been denied, it filed the present Petition 17 which raises the following issue for the Court's consideration: "whether just compensation should be paid only for the portions of respondents' properties affected by, and necessary for, the Transmission Line Project, and not for the entire area of respondents' properties." 18

We grant the petition.

For emphasis and illustration, the following are the lot areas involved in the present controversy:

 

Owner	Total area (square meters)	Affected area
Heirs of Antonio Marasigan	10,984	2,210
Heirs of Vicente Cabral	10,342	3,280
Heirs of Romeo Mendoza	745	745
Total:	22,071	6,235

 

Both the RTC and the CA held that petitioner should pay just compensation not only for the area being expropriated, which is 6,235 sq. m. but also for the entire land area owned by respondents, i.e., 22,071 sq. m. They so ruled supposedly on the basis of the Court's ruling in Manubay which they held to be on all fours with the factual backdrop of this case.

The courts a quo, however, misread the ruling in Manubay.

The issue in Manubay is the amount of just compensation to be paid for a parcel of land that will be traversed by high-powered transmission lines, since therein petitioner NPC sought merely an easement of aerial right of way. NPC argued in that case that there is no "taking" of the property, but only an imposition of an encumbrance which will not deprive therein respondent of the beneficial enjoyment of the property. Even if there was "taking," NPC contended that the loss is limited to a portion of the aerial domain above therein respondent's property. Hence, the latter should be compensated only for what it would actually lose.

The Court in Manubay held, however, that just compensation should not consist of a simple easement fee, but the full value of the property. The nature and effect of the installation of the power lines must be considered, among others, since the limitations on the use of the land for an indefinite period would deprive therein respondent of the normal use of the property. Hence, the latter is entitled to the payment of just compensation, which must be neither more nor less than the monetary equivalent of the land.

Here, the original plaintiff, NPC, advanced a similar argument that it applied in the Manubay case, namely, that it was liable to pay only easement fees for the affected areas, plus legal interest. In its decision, the RTC addressed the argument by citing the following excerpt from Manubay:

Granting arguendo that what the petitioner acquired over respondent's property was purely an easement of right of way, still, we cannot sustain its view that it should pay only an easement fee, and not the full value of the property. The acquisition of such easement falls within the purview of the power of eminent domain. Thus conclusion finds support in similar cases in which the Supreme Court sustained the award of just compensation for private property condemned for public purpose. 19

The RTC thus held that in the light of the foregoing ruling, it would be absurd to compel petitioner to pay only easement fees. 20 Hence, it required petitioner to pay just compensation in the amount of P130.00 per sq. m., plus legal interest. There is really no issue up to this point.

The issue arose when the RTC directed petitioner to pay just compensation for the entire landholding of respondents — heirs of Antonio Marasigan and heirs of Vicente Cabral — and not just for the area subject of the expropriation. Apparently, at this point, the RTC misinterpreted the Court's use of the phrase "full value of the property" in Manubay.

Unfortunately, the CA shared the same frame of mind. While it enunciated the issue of the appeal to be "whether the heirs of Marasigan, et al., are entitled to just compensation for the entire valuation of the properties, or only for easement fees representing the portion of the properties actually necessary for the installation of the Transmission Line Project," 21 it nonetheless ruled that petitioner must pay for the entire value of the properties including portions that are not directly affected by the project. This is so, purportedly because the project "would impose a limitation on the use of the land for an indefinite period of time, thereby justifying the payment of the full value of the properties." 22

It must be stressed, however, that when Manubay referred to "full value of property," it was in the context of differentiating between requiring therein petitioner to pay an easement fee of 10% of the market value of the property taken, as against requiring it to pay just compensation equivalent to the market value of the land that will be burdened by the easement. There is nothing in Manubay that serves as authority for the courts a quo to rule that herein petitioner must pay just compensation even for the portions of land that will not be used for the transmission lines. To be sure, the land area contemplated in Manubay is the entire area subject of the expropriation proceeding. In National Power Corporation v. Purefoods Corporation, 23 the Court made it clear that its ruling in Manubay pertained to payment of just compensation based on the full market value of the affected properties. Thus:

The question of just compensation for an easement of right-of-way over a parcel of land that will be traversed by NAPOCOR's transmission lines has already been answered in National Power Corporation v. Manubay Agro-Industrial Development Corporation. In that case, the Court held that because of the nature of the easement, which will deprive the normal use of the land for an indefinite period, just compensation must be based on the full market value of the affected properties. 24 (emphasis supplied)

Just compensation is defined as the full and fair equivalent of the property taken from its owner by the expropriator. 25 The rule is that the owner of private property should be compensated only for what he actually loses; it is not intended that his compensation shall extend beyond his loss or injury. Compensation must be just not only to the individual whose property is taken, but to the public, which is to pay for it. 26 In this case, the property taken from respondents is only the combined 6,235-sq. m. portion of their total landholding of 22,071 sq. m. Hence, they should be compensated only for this area. Anything more than that is no longer just to the public which bears the cost of compensation.

Besides, just compensation is not the proper recompense for any adverse effect of expropriation on the remainder of respondents' properties.

The general rule in eminent domain proceedings is that the just compensation to which the owner of the condemned property is entitled is the market value of the property. But the rule is modified where only a part of a certain property is expropriated. 27 There is also taking in the exercise of the power of eminent domain where the government not only actually deprives or dispossesses the property owner of his property or of its ordinary use, but also causes a practical destruction or material impairment of the value of the property. 28 In such a case, the owner is not restricted to compensation for the portion actually taken. In addition to the market value of the portion taken, he is also entitled to recover the consequential damage, if any, to the remaining part of the property. 29

In view of the foregoing settled rulings, consequential damages, not just compensation, are awarded if, as a result of the expropriation, the remaining property of the owner suffers from an impairment or decrease in value. 30 To be compensable, however, there must be evidence of consequential damage to the landowner's property. The damage must be alleged and proved. 31 In this case, there is no such evidence adduced by respondents. Notably, the Commissioner's Report recommended the payment of just compensation only for the "subject affected portions of the property," and made no mention whatsoever of consequential damages suffered by respondents. Notably, the parties have not taken exception to this report. cHDAIS

WHEREFORE, the petition is GRANTED. The Court of Appeals' Decision dated February 20, 2018 and its Resolution dated October 17, 2018 in CA-G.R. CV No. 104259 are MODIFIED in that petitioner National Transmission Corporation is required to PAY respondents just compensation of P130.00 per square meter with legal interest at six percent (6%) per annum from the time of the filing of the complaint until full payment for only the 6,235-square meter portion of respondents' properties, broken down as follows:

1) Heirs of Antonio Marasigan — 2,210 square meters

2) Heirs of Vicente Cabral — 3,280 square meters

3) Heirs of Romeo Mendoza — 745 square meters

The case is REMANDED to the Regional Trial Court of Pallocan West, Batangas City, Branch 8, for the computation of the final amount of just compensation.

SO ORDERED."

By authority of the Court:

(SGD.) LIBRADA C. BUENADivision Clerk of Court

by:

MARIA TERESA B. SIBULODeputy Division Clerk of Court

 

Footnotes

1.Rollo, pp. 33-40; penned by Associate Justice Germano Francisco D. Legaspi with Associate Justices Ramon R. Garcia and Myra V. Garcia-Fernandez, concurring.

2.Id. at 41-43.

3.Id. at 117-123; penned by Presiding Judge Ernesto L. Marajas.

4.Id. at 44-49.

5.Id. at 72-78.

6.Id. at 73-74.

7.Id. at 109.

8.Id. at 110-111.

9.Id. at 114-116.

10. 480 Phil. 470 (2004).

11.Rollo, pp. 122-123.

12. Petitioner subsequently substituted NPC in the proceedings.

13.Rollo, pp. 124-130.

14.Id. at 37.

15.Id. at 38-39.

16.Id. at 39.

17.Id. at 11-27.

18.Id. at 17.

19.Id. at 21.

20.Id.

21.Id. at 37.

22.Id. at 38; emphasis supplied.

23. 586 Phil. 587 (2008).

24.Id. at 601.

25.National Power Corporation v. Manubay Agro-Industrial Development Corporation, supra note 10, at 479.

26.Republic v. Lara, 96 Phil. 170, 177-178 (1954).

27.National Power Corporation v. Purefoods Corporation, supra note 23, at 602-603.

28.Republic of the Philippines v. Andaya, 552 Phil. 40, 46 (2007).

29.National Power Corporation v. Purefoods Corporation, supra note 23, at 603.

30.Republic v. Court of Appeals, 612 Phil. 965, 982 (2009).

31.Republic of the Philippines v. Andaya, supra note 28, at 47.