G.R. No. 168122 . January 30, 2007.
ROMONAFE CORPORATION, Petitioner, vs. NATIONAL POWER CORPORATION and VINE DEVELOPMENT CORPORATION, Respondents.

FACTS

The National Power Corporation (NPC) filed a complaint for eminent domain against Romonafe Corporation and Vine Development Corporation. The RTC issued a writ of possession, and NPC took possession of the properties. Commissioners recommended just compensation at P3,500 per square meter. NPC opposed, arguing valuation should be based on the market value at the time of the complaint’s filing in 1995, citing a Provincial Appraisal Committee resolution. The RTC nonetheless ordered NPC to pay at the P3,500 rate. NPC appealed to the Court of Appeals.
During the appeal, NPC and Romonafe entered into a Compromise Agreement based on the 1997 valuation. The Office of the Solicitor General (OSG) questioned the authority of the NPC lawyers to sign such an agreement for an appellate case. The CA dismissed NPC’s appeal solely on this procedural ground of lack of authority of counsel. NPC’s petition to the Supreme Court in G.R. No. 137785 resulted in a remand, with the High Court invalidating the compromise due to unauthorized signatures and directing the CA to resolve the appeal on its merits. Upon remand, the CA affirmed the RTC’s valuation. NPC filed a motion for reconsideration, which was denied, prompting this petition.

ISSUE

Whether the Court of Appeals erred in affirming the trial court’s determination of just compensation based on the property’s value at the time of payment rather than at the time of the filing of the expropriation complaint.

RULING

The Supreme Court denied the petition and affirmed the CA decision. The legal logic is anchored on the principle of just compensation under the Constitution and the Rules of Court. The Court reiterated the doctrine established in National Power Corporation v. Angas that just compensation is the fair market value of the property at the time of its taking or filing of the complaint, whichever comes first. In this case, NPC filed the complaint on July 12, 1995, but the writ of possession was issued and NPC took possession on February 12, 1996. Therefore, the “taking” for which compensation is due occurred in February 1996, not at the time of the later payment.
The Court found the CA correctly applied this rule. The commissioners’ initial use of a 1997 valuation was erroneous, but the RTC’s reference to a 1997 Provincial Appraisal Committee resolution (assessing the property at P3,500/sqm) was not the sole basis. The Court noted that NPC itself, in its opposition before the RTC, presented the 1995 PAC resolution valuing Romonafe’s land at P1,500/sqm and Vine’s at P2,000/sqm. The RTC found the 1995 values unrealistic, as they were significantly lower than the 1997 values for adjacent properties, and determined that the fair market value at the time of taking in early 1996 was reasonably reflected by the subsequent 1997 appraisal of P3,500/sqm. Thus, the valuation was not based on the time of payment but was a factual determination of value at the time of taking, which the appellate court rightly upheld.