G.R. No. 240720 . November 17, 2021
Spouses Herbert E. Buot and Ophelia R. Completo, Petitioners, vs. National Transmission Corporation, now substituted by National Grid Corporation of the Philippines, Respondent.

FACTS

Petitioners Spouses Buot are the registered owners of a parcel of agricultural land in Sibonga, Cebu, with an area of approximately 117,850 square meters, originally registered under a free patent carrying a general reservation for public easements. Respondent National Transmission Corporation (Transco), later substituted by the National Grid Corporation of the Philippines (NGCP), filed a complaint for expropriation to acquire a 196-square-meter portion and enforce an easement of right-of-way over 7,382 square meters of the subject property for its Naga-Suba 138KV T/L Upgrading Project. Spouses Buot opposed, arguing that the danger and adverse effects of the transmission tower would render their entire lot useless, and they sought just compensation for the entire affected area of 7,578 square meters (including existing lines). The RTC appointed commissioners, issued a writ of possession after Spouses Buot encashed a provisional payment, and eventually rendered a Decision ordering NGCP to pay just compensation at P1,000.00 per square meter for the 7,578-square-meter area, plus payment for improvements. The Court of Appeals set aside the RTC Decision, ruling that: (1) under Section 112 of Commonwealth Act No. 141 , as amended, a legal easement of right-of-way not exceeding 60 meters in width for power transmission lines exists on lands granted by patent, for which no compensation is due save for damaged improvements; (2) the RTC’s valuation lacked sufficient basis; and (3) the case should be remanded to the RTC for proper determination of just compensation for the expropriated area (after deducting the 60-meter easement) and the affected improvements, and for NGCP to obtain a quitclaim over the 60-meter portion. Spouses Buot filed a Petition for Review.

ISSUE

Whether the Court of Appeals erred in remanding the case to the RTC for the determination of just compensation and for the execution of a quitclaim over the 60-meter wide easement, based on its interpretation of Section 112 of Commonwealth Act No. 141 , as amended.

RULING

The Supreme Court DENIED the petition and AFFIRMED the Court of Appeals Decision with MODIFICATION. The Court held:
1. On the 60-Meter Legal Easement: The Court affirmed the CA’s ruling that Section 112 of Commonwealth Act No. 141 , as amended by Presidential Decree Nos. 635 and 1361, grants the government a 60-meter wide legal easement of right-of-way for the construction and maintenance of power transmission lines over lands acquired through free patent. This easement is subsumed under the phrase “other similar works as the Government or any public or quasi-public service or enterprise” intended for public use. NGCP, as a franchise holder with the power of eminent domain, may appropriate this 60-meter wide area without payment, except for compensation for any improvements damaged. The owner’s remedy is to execute a quitclaim over the easement area, as required by the Implementing Rules of Republic Act No. 8974 .
2. On Just Compensation: The Court agreed with the CA that a remand to the RTC is necessary for the proper determination of just compensation. The RTC’s valuation of P1,000.00 per square meter was not supported by substantial evidence, as it erroneously relied on a compromise agreement for a property not within the vicinity. Furthermore, the valuation for improvements failed to specify the species of affected trees. The RTC must determine the fair market value as of the time of taking in 2007, in accordance with Republic Act No. 8974 and relevant jurisprudence, and assess consequential damages if the remaining property suffers a direct, immediate, and substantial decrease in value due to the taking.
3. On the Area Subject to Expropriation: The Court clarified that the 60-meter wide legal easement (approximately 7,578 square meters based on the project length) is not subject to payment. However, if NGCP requires an area wider than 60 meters, the excess portion is subject to expropriation and payment of just compensation. The case is remanded to the RTC to determine the actual area needed for the project, deduct the 60-meter easement, and compute just compensation for any area in excess thereof, as well as for consequential damages to the remainder of the property.
The dispositive portion of the CA Decision was modified to explicitly direct the RTC to: (a) determine the total area required for the project; (b) deduct the 60-meter wide legal easement area; (c) determine just compensation for any area in excess of the easement; (d) determine consequential damages, if any; and (e) determine compensation for damaged improvements. NGCP is directed to obtain a quitclaim from Spouses Buot for the 60-meter wide easement area.