National Power Corporation vs.

Heirs of Macasangkit Sangkay

656 SCRA 60/G.R. No. 165828
August 24, 2011

FACTS: National Power Corporation (NPC) undertook the Agus River Hydroelectric Power
Plant Project to generate electricity for Mindanao. It included the construction of several
underground tunnels to be used in diverting the water flow from the Agus River to the
hydroelectric plants.

On 1997, Respondents sued NPC for recovery of damages of the property and a prayer for just
compensation. They alleged that the tunnel deprived them of the agricultural, commercial,
industrial and residential value of their land; and that their land had also become an unsafe place
for habitation, forcing them and their workers to relocate to safer grounds.

ISSUE: Whether the Heirs of Sangkay have the right to just compensation

RULING: YES. Just compensation is the full and fair equivalent of the property taken from its
owner by the expropriator. It has the objective to recover the value of property taken in fact
by the governmental defendant, even though no formal exercise of the power of eminent
domain has been attempted by the taking agency.

The underground tunnels impose limitations on respondents’ use of the property for an indefinite
period and deprive them of its ordinary use. Hence, respondents are clearly entitled to the
payment of just compensation.

Notwithstanding the fact that petitioner only occupies the sub-terrain portion, it is liable to pay
not merely an easement fee but rather the full compensation for land. It is settled that the taking
of private property for public use, to be compensable, need not be an actual physical taking or
appropriation. This is so because in this case, the nature of the easement practically deprives the
owners of its normal beneficial use. Compensable taking includes destruction, restriction,
diminution, or interruption of the rights of ownership or of the common and necessary use and
enjoyment of the property in a lawful manner, lessening or destroying its value.

The five-year prescriptive period under Section 3(i) of Republic Act No. 6395 (An Act
Revising the Charter of the National Power Corporation) does not apply to claims for just
compensation.

We rule that the prescriptive period provided under Section 3(i) of Republic Act No. 6395
is applicable only to an action for damages, and does not extend to an action to recover just
compensation like this case. Consequently, NPC cannot thereby bar the right of the Heirs
of Macabangkit to recover just compensation for their land.