G.R. No. 254328 - Baysa vs. Santos

The National Power Corporation (NPC) filed an expropriation complaint on January 23, 2006, seeking an easement of right-of-way over four parcels of land owned by respondents located in Barangays Sagurong, San Agustin, and San Jose, Pili, Camarines Sur.
These lands were intended for the construction and maintenance of NPC’s Naga-Tiwi 230 KV (Single Bundle), Naga-Tiwi 230 KV (Double Bundle), and 69 KV Naga-Daraga Transmission Lines.
The combined total area of the affected portions was 49,173 square meters out of the respondents’ total landholdings.
NPC offered PhP 299,550.50 as just compensation based on tax declarations classifying the properties as agricultural and the corresponding BIR zonal valuation.

Respondents did not object to the expropriation itself but contested the classification of the properties as agricultural, asserting that since 1993 the land had been reclassified as industrial, commercial, and residential.
They supported this claim with:

Respondents claimed just compensation in the amount of PhP 47,064,400 based on this classification.
They also counterclaimed for consequential damages amounting to PhP 22,227,800 for so-called “dangling” portions of the properties (41,869 square meters) rendered unusable due to the transmission lines.

The Regional Trial Court (RTC) of Pili, Camarines Sur, after a pre-trial, issued an Order of Expropriation and fixed the provisional value at PhP 47,064,400, which NPC deposited with Landbank of the Philippines.
A writ of possession was issued in favor of NPC, and the deposited amount was ordered released to respondents.
An appraisal committee formed by the RTC submitted a report recommending the stated valuation and consequential damages.
The RTC conducted a reversed trial where:

Respondents' witnesses, including appraisal committee chairmen, testified about the valuation and consequential damages, finding that the transmission lines severely hampered the use of the “dangling” areas and diminished land usability.
NPC’s right-of-way officers contended that disputed “dangling” areas were agricultural and negotiable from 1996 (not the 1970s). They admitted classification errors in tax declarations that were used as basis for valuation.

The RTC validated respondents’ classification and the appraisal committee’s recommendations, rejecting NPC’s claim of possession since the 1970s for lack of proof, ruling that any such taking was without legal authority.
The RTC decision dated December 20, 2010, fixed just compensation at PhP 47,064,400 with 12% interest per annum and consequential damages of PhP 22,227,800 with similar interest, including attorney’s fees of PhP 20,000.
NPC’s motion for reconsideration was denied; however, the RTC modified the interest rate to 6% on the principal and a tiered interest rate on consequential damages from 6% to 12%.

The use of full market value for easement instead of a lower easement fee (10% of market value).
The reliance on reclassification rather than agricultural classification from tax declarations.
The timing of valuation based on 2006 filing rather than alleged taking in the 1970s.

Just compensation for an easement of right-of-way for high-power transmission lines must be based on full value, not mere easement fees.
The value must be based on classification and fair market value as of the time of filing in 2006, rejecting NPC’s claim of taking in 1970s.
The classification reclassification by municipal ordinance was valid for compensation purposes.
Consequential damages were proper and supported by evidence.

NPC filed the present Rule 45 Petition for Review on Certiorari before the Supreme Court challenging:

The date for reckoning value (1970s or 2006).
The basis of valuation (agricultural BIR zonal valuation or reclassified valuation).
The propriety of consequential damages.

Whether the value of the properties should be reckoned at the time of the alleged taking in the 1970s or at the time of filing the expropriation complaint in 2006.
Whether just compensation should be based on the properties’ classification as agricultural reflected in the tax declarations or on the reclassification as residential, commercial, and industrial.
Whether the award of consequential damages for the “dangling” portions is proper.