Case Summary (G.R. No. 266921)
Key Dates and Properties
Construction of the 500‑kilovolt transmission line by National Power Corporation (NAPOCOR), TRANSCO’s predecessor: 1998. Initiation of inverse condemnation proceedings by respondents: February 2020 (records reference filings in late February 2020). Subject parcels: Lot No. 1374‑B‑2 (spouses Manalo) and Lot No. 1465‑J (the Pedrajas), located in Tanauan City, Batangas; initially alleged affected areas were 2,376 sq. m. (Manalo) and 10,534 sq. m. (Pedraja), with the RTC later finding an affected area of 16,526 sq. m. for the Pedrajas.
Procedural Posture
Respondents filed a Complaint for Inverse Condemnation under Rule 67 of the Rules of Court (as amended by RA 8974 and later RA 10752). TRANSCO answered and filed defenses and a counterclaim. Respondents then moved to require TRANSCO to comply with RA 10752 by depositing provisional compensation equivalent to the current Bureau of Internal Revenue (BIR) zonal valuations. The RTC granted the motion and ordered deposits; TRANSCO’s motion for reconsideration was denied and the RTC adjusted the total provisional amount. TRANSCO filed a petition for certiorari before the Court of Appeals, which dismissed the petition. TRANSCO elevated the matter to the Supreme Court by Rule 45 petition; the Supreme Court denied the petition and affirmed the CA decision and resolution.
Central Legal Issue
Whether Section 6 of Republic Act No. 10752 (the Right‑of‑Way Act) governs the determination and computation of provisional compensation in inverse condemnation proceedings initiated in February 2020 for a taking that occurred in 1998, thereby requiring TRANSCO to deposit an amount equivalent to 100% of the land’s current BIR zonal valuation, or whether Rule 67 of the Rules of Court (requiring deposit of the assessed value for taxation) controls.
Relevant Statutory Provisions and Predecessors
Rule 67, Section 2 of the Rules of Court allows entry by the plaintiff upon depositing with an authorized government depositary an amount equivalent to the property’s assessed value for taxation. RA 8974 (2000) introduced a special rule for national government infrastructure projects requiring payment of 100% of the property’s value based on the current relevant BIR zonal valuation as provisional compensation. RA 10752 (Right‑of‑Way Act), which later repealed RA 8974 substantively, retained and framed the provisional‑deposit requirement in Section 6, mandating immediate court deposit in favor of the owner of 100% of the land’s BIR zonal valuation issued not more than three years prior to filing (subject to exceptions in the statute).
RTC Ruling and Reasoning
The RTC granted respondents’ motion and ordered TRANSCO to deposit the provisional compensation amounts proffered by respondents pursuant to Section 6 of RA 10752. The RTC held that RA 10752 governs both procedural and substantive aspects of provisional compensation in inverse condemnation actions relating to national government infrastructure projects. It treated the 500‑KV transmission line and attendant facilities as a national government project within the purview of RA 10752 and relied on precedent (Felisa Agricultural Corporation v. National Transmission Corporation) to support the conclusion that a landowner’s inverse condemnation suit filed after the effectivity of the Right‑of‑Way statute must be governed by that statute rather than by Rule 67.
Court of Appeals Ruling
The Court of Appeals dismissed TRANSCO’s petition for certiorari and affirmed the RTC. The CA agreed that RA 10752 applies because respondents initiated inverse condemnation proceedings after RA 10752’s effectivity. The CA emphasized that RA 10752’s requirement of provisional payment equal to 100% of the current BIR zonal value is more favorable to landowners than Rule 67’s assessed‑value deposit and that Felisa supported applying the Right‑of‑Way statute to suits filed post‑enactment even if the physical taking occurred earlier.
Supreme Court Ruling — Holding
The Supreme Court denied the petition and affirmed the CA. The Court held that RA 10752 governs the determination of provisional deposit in this case because the inverse condemnation complaint was filed after RA 10752’s effectivity. The Court reiterated that RA 8974 (the predecessor statute) and RA 10752 altered the provisional compensation standard for national government infrastructure projects by legislatively declaring a right to provisional compensation equal to 100% of the current BIR zonal valuation. Because this right was declared by subsequent legislation and the landowners invoked it for the first time in court after the statute’s effectivity, the statute applies to the proceedings even though the physical taking occurred earlier. The Court therefore affirmed the application of Section 6 of RA 10752 rather than Rule 67’s assessed‑value rule.
Reliance on Precedent and Distinction from Posadas III
The Court followed its earlier reasoning in Felisa Agricultural Corporation v. National Transmission Corporation, whic
...continue readingCase Syllabus (G.R. No. 266921)
Case Caption and Court
- Title and citation as appearing in the source: SECOND DIVISION [ G.R. No. 266921, January 22, 2024 ] NATIONAL TRANSMISSION CORPORATION, PETITIONER, VS. SPOUSES LOUIS MARCO S. MANALO AND ROWENA MARIE T. MANALO, REPRESENTED BY FREDDIE M. ARGUELLES, AND NONYLON D. PEDRAJA AND NONNA D. PEDRAJA, REPRESENTED BY JULIANITO B. MONCAYO, RESPONDENTS.
- Decision authored by Associate Justice KHO, JR., with concurrence by Leonen, SAJ. (Chairperson), Lazaro-Javier, M. Lopez, and J. Lopez, JJ.
- Petition for Review on Certiorari under Rule 45 directly assails the Court of Appeals Decision dated December 12, 2022 and Resolution dated April 4, 2023 in CA-G.R. SP No. 171202, which affirmed the RTC Order dated January 14, 2021 (Branch 66, Tanauan City, Batangas).
Parties
- Petitioner: National Transmission Corporation (TRANSCO), a government corporation organized to acquire transmission assets of the National Power Corporation (NAPOCOR), to assume NAPOCOR's electrical transmission function, and vested with the power of eminent domain subject to constitutional and statutory requirements.
- Respondents:
- Spouses Louis Marco S. Manalo and Rowena Marie T. Manalo, represented by Freddie M. Arguelles (referred to as spouses Manalo), owners of Lot No. 1374-B-2 in Barangay Banjo East (2,376 square meters affected according to respondents’ allegations).
- Nonylon D. Pedraja and Nonna D. Pedraja, represented by Julianito L. Moncayo (referred to as the Pedrajas), owners of Lot No. 1465-J in Barangay Bagumbayan (allegedly 10,534 square meters affected by respondents’ initial allegation; later RTC found 16,526 square meters affected with respect to the Pedrajas).
Nature of the Case and Relief Sought
- Original action: Complaint for Inverse Condemnation brought under Rule 67 of the Rules of Court, as amended by Republic Act No. 8974 and later by Republic Act No. 10752.
- Primary relief sought by respondents: determination and fixing of the fair market value of the subject lots pursuant to Republic Act No. 10752 and related reliefs, including an order for provisional compensation/deposit pursuant to Section 6 of RA 10752.
Factual Background — Taking and Timeline
- In 1998, NAPOCOR (predecessor of TRANSCO) constructed a 500-kilovolt (KV) transmission line traversing the subject properties for transmission of electric power from Batangas to Laguna and Metro Manila.
- TRANSCO admits that no expropriation proceedings were initiated at the time of the taking (the 1998 entry and construction).
- Respondents initiated inverse condemnation proceedings years later: respondents filed their Complaint (dates in the record include February 21, 2020 and February 24, 2020 in different portions of the source), i.e., after the effectivity of Republic Act No. 10752.
- Respondents allege areas affected by the transmission facility: spouses Manalo — 2,376 square meters of Lot No. 1374-B-2; the Pedrajas — initially alleged 10,534 square meters of Lot No. 1465-J, later adjusted by the RTC to an affected area of 16,526 square meters for the Pedrajas.
Pleadings, Motions and Positions of the Parties
- TRANSCO filed an Answer (with Special and Affirmative Defenses and Counterclaim) on August 3, 2020, praying for dismissal of the Complaint.
- Respondents filed a Motion to Require Defendant to Comply with Republic Act No. 10752 on September 15, 2020:
- Argument: while Rule 67 governs the procedural aspects of inverse condemnation, the determination of the amount of compensation is governed by RA 10752; Section 6 of RA 10752 mandates deposit to the RTC of the amount equivalent to the BIR current zonal valuation of the subject lots as provisional compensation.
- Respondents’ computation based on local Zoning Ordinance No. 2018-12: zonal values PHP 3,500.00/sqm for spouses Manalo’s property and PHP 3,750.00/sqm for the Pedrajas’ property, asking for provisional deposits of PHP 8,316,000.00 (spouses Manalo) and PHP 39,502,500.00 (the Pedrajas), total PHP 47,818,500.00.
- TRANSCO’s opposition / Comment filed November 25, 2020:
- Contention: RA 10752 and its provisional deposit provisions apply only to new projects, not to pre-existing transmission lines constructed before the law; alternatively, if provisional deposit is ordered, it should be based on assessed value under Rule 67.
- Later sought reduction of provisional deposit to PHP 12,725,640.00 based on a validation survey it conducted over the subject lots.
RTC Proceedings and Ruling
- RTC Order dated January 14, 2021:
- Granted respondents’ Motion and ordered TRANSCO to deposit the proffered amount totalling PHP 47,818,500.00 in favor of spouses Manalo and the Pedrajas pursuant to Section 6 of RA 10752.
- RTC held RA 10752 applies to the action and that determination of provisional compensation is governed by RA 10752, not by Rule 67.
- RTC reasoned that the 500-KV transmission line and its multiple cables traversing the subject lots fall within "national government projects" covered by RA 10752.
- Cited Section 6 of RA 10752 as mandating provisional deposit equal to 100% of the value of the land based on the current relevant BIR zonal valuation.
- Rejected TRANSCO’s contention that the rule in force at the time of the taking (Rule 67) should apply, relying on Felisa Agricultural Corporation v. National Transmission Corporation (834 Phil. 861, 2018) and its holding that if inverse condemnation is initiated after the effectivity of RA 8974 (precursor to RA 10752), that statute governs both procedurally and substantively.
- Motion for Reconsideration by TRANSCO sought reduction to PHP 12,725,640.00; RTC denied and issued an Order dated September 20, 2021, adjusting the total proffered amount to PHP 70,288,500.00 after finding the affected area for the Pedrajas to be 16,526 square meters (instead of the earlier 10,534 sqm).
Court of Appeals Decision and Resolution
- TRANSCO filed a Petition for Certiorari to the CA.
- CA Decision dated December 12, 2022:
- Dismissed the Petition for Certiorari and affirmed the RTC Order.
- Held that RA 10752 (specifically Section 6) is the applicable law to determine provisional compensation, not Rule 67.
- Applied the Felisa precedent and emphasized the undisputed facts: government had entered respondents’ proper