National Power Corp. v. Saludares
REITERATIONFacts
The Antecedents: The National Power Corporation (NAPOCOR) constructed high-tension transmission lines in the 1970s, traversing a portion of land owned by Esperanza Pereyras, et al. NAPOCOR initiated expropriation proceedings (National Power Corporation v. Pereyras) and was ordered to pay ₱300,000.00 as just compensation. Subsequently, Tahanan Realty Development Corporation was subrogated to the rights of the defendants, NAPOCOR paid Tahanan Realty, and a Deed of Absolute Sale was executed for Lot 481-B. Respondent spouses Bernardo and Mindaluz Saludares are the registered owners of a parcel of land (Lot 15, Pcs-11-000704, Amd.) covered by TCT No. T-109865, which is adjacent to or derived from the original parcel. On August 19, 1999, the spouses filed a complaint against NAPOCOR for failure to pay just compensation for the entry and occupation of their property for the transmission lines. Procedural History: The Regional Trial Court (RTC), Branch 31, Tagum City, ruled in favor of the respondent spouses, ordering NAPOCOR to pay ₱4,920,750.00 as just compensation, plus interest and attorney's fees. The Court of Appeals (CA) affirmed the RTC decision but reduced the interest rate to 6% per annum. NAPOCOR filed a Petition for Review on Certiorari before the Supreme Court. The Petition: NAPOCOR questions the CA's decision, arguing that it had already compensated the landowners in a previous expropriation case, that the claim for just compensation had prescribed, that it should only pay 10% of the fair market value, and that the trial court erred in fixing the compensation based on the 2000 market values.
Issue(s)
Whether NAPOCOR has previously compensated the spouses for establishing high-tension transmission lines over their property. Whether the demand for payment of just compensation has already prescribed. Whether petitioner is liable for only ten percent of the fair market value of the property or for the full value thereof. Whether the trial court properly awarded the amount of ₱4,920,750 as just compensation, based on the Approved Schedule of Market Values for Real Property in Tagum City for the Year 2000.
Ruling
The Supreme Court denied the petition and affirmed the Decision of the Court of Appeals, upholding the award of just compensation to the respondent spouses.
Ratio Decidendi
On whether NAPOCOR had previously compensated the spouses: The Court ruled that NAPOCOR failed to prove that the land involved in the instant petition was the same land expropriated in the previous case (National Power Corporation v. Pereyras). While the respondent spouses' title was indirectly sourced from the title in the previous case, the specific lot descriptions (Lot 481-B vs. Lot 15, Pcs-11-000704, Amd.) indicated different parcels of land. Therefore, NAPOCOR could not claim prior payment of just compensation for the subject property. On whether the demand for payment of just compensation has prescribed: The Court held that NAPOCOR's reliance on Section 3(i) of R.A. No. 6395, which provides a five-year prescriptive period for claims related to right-of-way, was misplaced. The constitutional mandate that private property shall not be taken without just compensation cannot be defeated by statutory prescription. The Court reiterated that the prescriptive period under R.A. No. 6395 does not extend to actions to recover just compensation, as it would be confiscatory. It was NAPOCOR's duty to initiate eminent domain proceedings, and its failure to do so constrained the respondents to file inverse condemnation proceedings. Thus, NAPOCOR could not invoke prescription to defeat the constitutional right. On whether NAPOCOR is liable for only ten percent or the full market value: The Court rejected NAPOCOR's argument that it should only pay ten percent of the fair market value, citing its Charter. The Court reiterated its ruling that when NAPOCOR takes private property for transmission lines, it is liable to pay the full market value. This is because the imposition of transmission lines, despite allowing for an easement of right-of-way, perpetually deprives the landowner of the ordinary use of the land due to safety concerns and limitations on planting, similar to the situation in National Power Corporation v. Gutierrez. The Court also emphasized that Section 3A of R.A. No. 6395 is not binding, as the determination of just compensation is a judicial function. On whether the trial court properly awarded just compensation based on the 2000 market values: The Court affirmed the trial court's use of the 2000 market values. Citing National Power Corporation v. Heirs of Macabangkit Sangkay, the Court held that the reckoning value of just compensation in inverse condemnation cases should be the value prevailing at the time of the filing of the inverse condemnation proceedings. This is because reckoning the value at the time of taking would compound the unfairness caused by NAPOCOR's entry without formal expropriation and its denial of due process. To prevent NAPOCOR from profiting from its failure to comply with the law, compensation must be based on the value at the time of the judicial demand.
Main Doctrine
The National Power Corporation (NAPOCOR) cannot invoke the statutory prescriptive period under R.A. No. 6395 to defeat the constitutional right to just compensation for the taking of private property for public use. The determination of just compensation is a judicial function, and the reckoning value should be that prevailing at the time of the filing of the inverse condemnation proceedings when the judicial demand for compensation is made.