NATIONAL POWER CORPORATION VS SOCORRO POSADA, et al.

GR NO. 191945
March 11, 2015
Doctrine: Power of Eminent Domain

FACTS:

NAPOCOR instituted expropriation proceedings over parcels of land in Brgy. Maginhawa, Bato,
Catanduanes for a right-of-way easement, construction and maintenance of its Substation Island
Grid Project.

NAPOCOR offered a price of P500.00 per square meter. However, respondents (property owners)
objected and alleged that the value of properties was P2000.00 per square meter.

On Dec. 16, 2002 RTC of Virac, Catanduanes confirmed the NAPOCOR’s right to expropriate and
ordered the creation of a commission to determine the amount of just compensation to be paid to
respondents.

On Jan. 28, 2003 NAPOCOR filed a Notice to Take Possession on the basis of Rule 67 Rules of Court
alleging its entitlement thereof in view of its deposit with Land Bank of the Philippines in the
amount of P 3280.00 on the provisional value of the properties.

On July 10, 2003 the court appointed commissioners recommended a fair market value of P1500.00
per square meter based on their research and proper considerations on the present market value of
properties, location, and surrounding properties in the area.

NAPOCOR opposed the recommendation of the commissioners arguing, inter alia, that:

a) the opinions given by people who live in the area must not be given weight due to their lack of
real estate expertise;

b) The Provincial Appraisal Committee valued said lot at P500.00 per square meter;

c) The approved zonal values of real properties in Catanduanes classified as Residential Regular
(RR) is P105.00 per square meter.

d) Only an easement of right-of-way shall be acquired over the properties of the defendants which
remain classified as cocoland and as provided in RA 6395 (NPC Charter), shall not exceed 10% of
the market value declared by the owner or administrator or anyone having legal interest in the
property, or as determined by the assessor, whichever is lower.

NAPOCOR amended its complaint stating that it need the properties to construct the Substation
Island Grid Project instead of just an easement of right of way and made a deposit with Land Bank
in the amount of P580, 769.93 alleging that this represented the value of 3,954 square meters
sought to be expropriated. NAPOCOR then filed an Urgent Ex Parte Motion for the issuance of a Writ
of Possession which was granted by the RTC.

Upon the granted motion of time extension to remove the properties of the respondents, the trial
court fixed the value of the structures and improvements on the land to P827, 000.00 and ordered
NAPOCOR to deposit the additional amount of P262, 639.17 which it failed to deposit to which the
trial court resolves by CANCELING the Writ of Possession.

The appeal made by NAPOCOR was denied by the CA.

In a turn of events, NAPOCOR stated that it no longer needed the properties as it was set to acquire
an alternative site and filed a Motion to Withdraw Appeal praying for withdrawal of its appeal for
its Amended Complaint to be dismissed.

ISSUES:

Whether or not the trial court erred:

1. On relying on the commissioners on the valuation of improvements and/or structures; and
2. In recalling the Writ of Possession

HELD:

SC held that the trial court committed two errors.

1. First, it should have based the value of the improvements on the property on the
determination made by NAPOCOR and not its commissioners as required by Section 7 and
10 of RA 8974:

Section 7 Valuation of Improvements and/or Structures.--The Department of Public Works and Highways
and othr implementing agencies concerned, in coordination with the local government units concerned in the
acquisition of right-of-way, site or location for any national government infrastructure project, are herby
mandated to adopt within sixty (60) days upon approval of this Act, the necessary implementing rules and
regulations for the equitable valuation of the improvements and/or structures on the land to be expropriated.

Section 10 Pursuant to Section 7 of the Act, the Implementing agency shall determine the valuation of the
improvements and/or structures on the land to be acquired using the replacement cost method. xxx

According to the law, it is the implementing agency, not the commissioners, that determines the
proffered value of improvements and structures. A Writ of Possession may be issued once there is
confirmation by the trial court of the proffered value.

2. The second error of the trial court occurred when it issued a Writ of Possession on the basis
of NAPOCOR’s deposit of the alleged provisional value with Land Bank, not on its actual
payment to respondents. Even if the deposit of P580, 769.93 was the correct provisional
value, it cannot be considered as compliance with Section 4 of RA 8974 which plainly
requires direct payment to the property owner, not a mere deposit with the authorized
government depositary. Without such direct payment, no writ of possession may be
obtained, which, NAPOCOR failed to do.

WHEREFORE, the Motion to Withdraw Appeal dated August 28, 2014 is GRANTED insofar as it
withdraws the Petition for Review dated June 4, 2010. The Motion for Leave to File Comment (to
Petitioner’s Motion to Withdraw Appeal) dated September 30, 2014 is NOTED. This case is
REMANDED to the RTC of Virac, Catanduanes for appropriate action.