National Grid v. Gaite
REITERATIONFacts
The Antecedents: National Grid Corporation of the Philippines (NGCP) initiated an eminent domain proceeding to acquire properties belonging to Getulia A. Gaite and the Heirs of Trinidad Gaite for the Abaga-Kirahon 230 kV Transmission Line Project. NGCP deposited P186,063.42, representing 100% of the BIR zonal value, to gain possession of the affected agricultural lands totaling 7,973.03 square meters. Subsequently, commissioners were appointed to determine just compensation. While two commissioners recommended P60.00 per square meter, one commissioner, Atty. Capistrano, submitted a separate report valuing the property at P300.00 per square meter, citing a reclassification to agri-industrial, though this reclassification was not yet implemented. Procedural History: The Regional Trial Court (RTC) of Iligan City, Branch 3, adopted Atty. Capistrano's P300.00 per square meter valuation in its August 5, 2014 Decision, ordering NGCP to pay the respondents P2,391,910.80, less the initial deposit, plus legal interest. NGCP's motion for reconsideration was denied. NGCP appealed to the Court of Appeals (CA), assailing the RTC's valuation. However, the CA dismissed the appeal on October 27, 2016, due to NGCP's failure to file an Appellant's Brief. The CA subsequently denied NGCP's motion for reconsideration on May 11, 2017. The Petition: NGCP filed a Petition for Review on Certiorari with the Supreme Court, arguing that the CA erred in dismissing its appeal without reviewing the merits, contending that the RTC's valuation was grossly unfair and unreasonable. NGCP asserted that the joint commissioner's report, based on actual sales data of similar properties at P47.30 per square meter, was more credible than Atty. Capistrano's report, which lacked factual and legal basis. NGCP also argued for the relaxation of procedural rules in favor of substantial justice, claiming its failure to file the brief was in good faith and not intended to delay the proceedings.
Issue(s)
Whether the Court of Appeals erred in not reviewing the merits of the appeal, considering the RTC's decision on just compensation was allegedly unfair and unreasonable, and whether the Court of Appeals erred in the determination of just compensation. Whether the Court of Appeals erred in not exercising its discretion in favor of substantial justice by admitting the Appellant's Brief, considering NGCP's good faith explanation for the delay, and on the payment of interest.
Ruling
The Supreme Court GRANTED the petition, REVERSED and SET ASIDE the CA Resolutions, and MODIFIED the RTC Decision. The Court fixed the just compensation at P60.00 per square meter, totaling P478,381.56 (less the initial deposit), with specific interest rates. The Court also ordered payment of honoraria to the commissioners.
Ratio Decidendi
On the issue of the Court of Appeals' dismissal of the appeal and the determination of just compensation: The Court reiterated that the dismissal of an appeal for failure to file an appellant's brief is discretionary. The determination of just compensation is a judicial function, which must be based on reliable and actual data. While the appointment of commissioners is mandatory, their findings may be disregarded only for valid reasons. The Court found that the RTC erred in fully adopting Atty. Capistrano's separate report, which lacked factual and legal basis. In contrast, the joint commissioner's report was based on ocular inspections and actual sales data of similar properties located nearby, making it more credible. Therefore, the Court deemed it prudent to adopt the recommendation in the joint commissioner's report to avoid further delay and prejudice to both parties. On the issue of the Court of Appeals' discretion and the payment of interest: The Court found sufficient reason to relax procedural rules in the interest of substantial justice, considering the substantial amount involved and the potential deprivation of property rights. The Court affirmed the RTC's judgment regarding the payment of interest on just compensation but modified the applicable rates. Citing established jurisprudence, the Court held that the just compensation due to landowners constitutes an effective forbearance on the part of the government. Consequently, interest at the rate of twelve percent (12%) per annum is due from the date of taking until June 30, 2013, and six percent (6%) per annum thereafter until full payment. Furthermore, all sums due shall earn legal interest at the rate of six percent (6%) per annum from the finality of the Decision until full payment.
Main Doctrine
The dismissal of an appeal due to failure to file an appellant's brief is discretionary, not mandatory. The Court of Appeals must exercise sound discretion, considering equity and substantial justice. The determination of just compensation is a judicial function that must be based on reliable and actual data, and a commissioner's report lacking such basis should not be fully adopted.