GR 193936; (December, 2013) (Digest)
G.R. No. 193936 ; December 11, 2013
NATIONAL POWER CORPORATION, Petitioner, vs. YCLA SUGAR DEVELOPMENT CORPORATION, Respondent.
FACTS
Petitioner National Power Corporation (NPC), a government corporation authorized to exercise eminent domain, filed a complaint for expropriation to acquire an easement of right-of-way over portions of respondent YCLA Sugar Development Corporation’s land in Puerto Galera, Oriental Mindoro. The expropriation was necessary for NPC’s 69 KV Calapan-Mamburao Island Grid Project. The RTC issued a writ of possession in favor of NPC and constituted a Board of Commissioners to determine just compensation.
The Board initially recommended compensation of ₱500 per square meter. YCLA objected, leading the RTC to order a new ocular inspection. Subsequently, the Board submitted a second report recommending ₱1,000 per square meter, citing the property’s strategic location and consequential damages. The RTC adopted this second recommendation in its decision. The Court of Appeals affirmed the RTC decision but modified the interest computation. NPC elevated the case to the Supreme Court, contending the awarded compensation was excessive.
ISSUE
Whether the Court of Appeals erred in affirming the trial court’s determination of just compensation based on the Board of Commissioners’ second report.
RULING
The Supreme Court granted the petition and remanded the case for proper determination of just compensation. The Court held that the RTC and the CA erred in relying on the Board of Commissioners’ second report, which recommended ₱1,000 per square meter. The legal logic is anchored on the fundamental rule that just compensation must be the full and fair equivalent of the property taken at the time of its taking. The Court found the Board’s second report legally infirm.
The report was based on the “prevailing market value” and opinions of “reliable persons” without any supporting documentary evidence, such as tax declarations, sworn statements, or actual sales data. This contravenes the requirement that commissioners’ findings must be supported by substantial evidence. Furthermore, the valuation considered consequential damages from the taking, which is improper as just compensation is based on the value of the land at the time of taking, not on speculative future damages or the project’s impact. The Court emphasized that the determination of just compensation is a judicial function, and courts must not rely on arbitrary or unsupported recommendations. Thus, the case was remanded to the trial court to receive proper evidence and determine just compensation in accordance with established legal standards and the specific facts of the case.