G.R. No. 190207 & 190213, June 30, 2021
LLOYDS INDUSTRIAL RICHFIELD CORPORATION (NOW MERGED WITH AND KNOWN AS REPUBLIC CEMENT CORPORATION), PETITIONER, VS. NATIONAL POWER CORPORATION, RESPONDENT. (G.R. No. 190207) / NATIONAL POWER CORPORATION, PETITIONER, VS. LLOYDS RICHFIELD INDUSTRIAL CORPORATION, RESPONDENT. (G.R. No. 190213)

FACTS

Lloyds Richfield Industrial Corporation (Lloyds Richfield), a cement manufacturer, owned parcels of land in Carmen, Cebu, from which it quarried limestone. The National Power Corporation (NPC) negotiated for an easement of right of way over these lands to construct transmission lines for the 230 KV Leyte-Cebu Interconnection Project. When negotiations failed, NPC filed a complaint for expropriation. The Regional Trial Court (RTC) issued a Writ of Possession. Lloyds Richfield demanded payment of the fair market value of the land and the limestone deposits, arguing the construction would render the properties useless for its business. A Committee on Appraisal recommended just compensation at P450.00 per square meter for the land and P26.00 per ton for limestone deposits. It also recommended increasing the number of lots to be expropriated from seven to eleven due to an increased safety zone for blasting. NPC opposed, arguing it only needed an easement (payable at 10% of land value) and should not pay for limestone, a mineral owned by the State. The RTC condemned all eleven lots, ordering NPC to pay just compensation for both land and limestone. The Court of Appeals affirmed the condemnation of eleven lots and the payment of full land value but deleted the compensation for limestone deposits.

ISSUE

1. Whether NPC must pay full just compensation for the fair market value of the land or merely an easement fee.
2. Whether the expropriation should cover eleven lots instead of the original seven.
3. Whether Lloyds Richfield is entitled to just compensation for the value of the limestone deposits on the expropriated land.

RULING

1. Yes. NPC must pay full just compensation equivalent to the fair market value of the land. The imposition of transmission lines constitutes a taking, not a mere easement, because it perpetually deprives the owner of its proprietary rights, specifically the ability to quarry limestone, which is the property’s intended use. A mere easement fee is insufficient when the restriction indefinitely limits the use and enjoyment of the property.
2. Yes. The expropriation properly covers eleven lots. The Committee on Appraisal recommended increasing the safety zone, which necessitated including four additional lots. NPC failed to rebut this recommendation with contrary evidence, leaving the court with no logical alternative but to accept it.
3. No. Lloyds Richfield is not entitled to just compensation for the limestone deposits. Under the Constitution, all minerals, including limestone, are owned by the State. While Lloyds Richfield had a Mineral Production Sharing Agreement, this only granted it the right to extract and utilize the minerals, not ownership over them. Compensation for the loss of limestone represents an income or opportunity loss, which is not a proper element of just compensation in expropriation. The increased cost of sourcing limestone elsewhere is a business risk, and compensating for it would result in unjust enrichment.