G.R. No. 190207, June 30, 2021

FACTS:

Lloyds Richfield purchased parcels of land within its vicinity and quarried limestones from these areas, which would then be used to manufacture cement. NAPOCOR entered into negotiations with Lloyds Richfield to create an easement of right of way over the parcels of land for the construction of transmission lines.   When negotiations failed, the NAPOCOR filed a Complaint for expropriation before the Regional Trial Court of Danao City relating to 7 lots owned by Lloyds . 

Lloyds Richfield demanded by way of compulsory claim that the NAPOCOR pay the fair market value of the parcels of land, since the construction of transmission lines over its properties would render the properties useless to it. It also demanded to be paid the fair market value ofthe limestone deposits in the parcels of land.

The Committee on Appraisal recommended an increase in the safety zone which would require NAPOCOR to  expropriate four more lots that were not originally cited in the Complaint. 

NAPOCOR insisted that 

1. That it could not be made to pay just compensation for the limestone deposits as these were minerals, which were owned not by Lloyds Richfield, but by the State. 
2. It contended that it may only acquire an easement of right of way over the parcels of land pursuant to Republic Act No. 6395, and thus, may only pay an easement fee equivalent to 10% of the market value of the lands to be expropriated.

ISSUES: 

1. Whether Lloyd is entitled to an amount equivalent to the fair market value of its properties expropriated by the National Power Corporation not just a 10% easement fee;
2. Whether the award of just compensation for the limestone deposits shall be granted

HELD: 

1. YES. Here, constructing transmission lines over Lloyds Richfield’s properties impairs the principal purpose for which the parcels of expropriated land were actually devoted: quarrying activities. Consequently, a right-of-way easement will not suffice. Lloyds Richfield is entitled to the full market value of the properties as just compensation, not just an easement fee, for the taking of its properties.

The Constitution mandates the payment of just compensation for the taking of private property for public use. Section 9 of the Bill of Rights provides:

SECTION 9. Private property shall not be taken for public use without just compensation.

Just compensation is “the full and fair equivalent of the property taken from its owner by the expropriator.

“Just” means the compensation given to the owner for the taking of the property must be “real, substantial, full and ample.” In monetary terms, just compensation is the fair market value of the property taken. It is that “sum of money which a person desirous, but not compelled to buy, and an owner, willing, but not compelled to sell, would agree on as a price to be given and received for such property. Expropriation, however, is not limited to the taking of property with the corresponding transfer of title from the landowner to the expropriator. Easements of right of way fall within the purview of expropriation, allowed when the restrictions on the landowner’s property rights are not perpetual or indefinite In such a case, a mere easement fee may suffice.

Here, expropriation by creating an easement of right of way is impossible. Constructing transmission lines over the expropriated properties placed an indefinite and perpetual restriction on Lloyds Richfield’s proprietary rights. This is especially true since Lloyds Richfield has been perpetually prohibited from conducting dynamite blasting and quarrying activities in the properties expropriated, or else the transmission lines would be damaged or completely destroyed, endangering lives and properties. Therefore, the National Power Corporation has no choice but to expropriate the properties in the traditional sense, to take the properties and acquire title, for which it must pay the full market value of the properties as just compensation.

2. Lloyds Richfield, however, is not entitled to just compensation for the limestone deposits in its properties.

Under Article XII, Section 2 of the Constitution, the State owns all minerals found in Philippine soil. While Lloyds Richfield has title to the properties, it does not own the minerals underneath them, as shown by the permits and the Mineral Production Sharing Agreement it had to secure from the government to conduct quarrying activities in its properties. Article 437 of the Civil Code, which provides that the owner of a parcel of land is the owner of its surface and everything under it, is not without limitations. For one, it is a statute that cannot trump a constitutional provision. Article 437 itself provides that it is “subject to special laws and ordinances.” Certainly, the Constitution can be considered a special law, if not the fundamental law, to which all statutes must conform.

In Republic v. Court of Appeals, this Court held that an owner of a parcel of land may even be ousted of ownership of their land should minerals be found underneath it, in which case, they shall be paid just compensation for the taking of the land, not for the taking of the minerals underneath it.

The rule simply reserves to the State all minerals that may be found in public and even private land devoted to “agricultural, industrial, commercial, residential or (for) any purpose other than mining.” Thus, if a person is the owner of agricultural land in which minerals are discovered, his ownership of such land does not give him the right to extract or utilize the said minerals without the permission of the State to which such minerals belong.

… [O]nce minerals are discovered in the land, whatever the use to which it is being devoted at the time, such use may be discontinued by the State to enable it to extract the minerals therein in the exercise of its sovereign prerogative. The land is thus converted to mineral land and may not be used by any private party, including the registered owner thereof, for any other purpose that will impede the mining operations to be undertaken therein. For the loss sustained by such owner, he is of course entitled to just compensation under the Mining Laws or in appropriate expropriation proceedings

G.R. No. 190004. August 8, 2017.

FACTS:

Eugenio Dalauta (Dalauta) was the registered owner of agricultural land in Florida, Butuan City, with an area of 25.2160 hectares. In 1994, the land was placed by the Department of Agrarian Reform (DAR) under compulsory acquisition of the Comprehensive Agrarian Reform Program (CARP). LBP offered P192,782.59 as compensation for the land, but Dalauta rejected such valuation for being too low.

The DAR Adjudication Board (DARAB) through the Provincial Agrarian Reform Adjudicator (PARAD), in a summary administrative proceeding, determined the appropriate just compensation for the subject property. It affirmed the valuation made by LBP.

In 2000, Dalauta filed a petition for determination of just compensation with the RTC, sitting as SAC. It constituted the Board of Commissioners (Commissioners) tasked to inspect the land and to make a report thereon. The report recommended that the value of the land be pegged at P100,000.00 per hectare.

The SAC taking into consideration the Commissioners Report directed LBP to pay – (a) 2,639,557.00 value of the land; (b) P100,000 for the farmhouse; (c) Reasonable legal fees and litigation expenses.

LBP filed a petition for review under Rule 42 of the Rules of Court before the CA, arguing –
That the SAC erred in taking cognizance of the case when the DARAB decision sustaining the LBP valuation had long attained finality;
that the SAC erred in taking judicial notice of the Commissioners’ Report without conducting a hearing; and
that the SAC violated the Republic Act (R.A.) No. 6657 and DAR A.O. No. 6, series of 1992, in fixing the just compensation.

The CA ruled that the SAC correctly took cognizance of the case. It sustained the valuation by the SAC for being well within R.A. No. 6657.

ISSUE/S:

1. Whether the trial court had properly taken jurisdiction over the case despite the finality of the PARAD Resolution.
2. Whether or not the case already prescribed.

HELD:

YES. The RTC, acting as a Special Agrarian Court (SAC), may exercise its exclusive original jurisdiction under Section 57 of R. A. No. 6657 to determine just compensation to landowners despite the lapse of 15 days from receipt by the landowner of the adjudicator’s decision fixing the just compensation. 

In all these cases, it was uniformly decided that the petition for determination of just compensation before the SAC should be filed within the period prescribed under the DARAB Rules, that is, “within fifteen ( 15) days from receipt of the notice thereof.”

In Export Processing Zone Authority v. Dulay,  the Court ruled that the valuation of property in eminent domain is essentially a judicial function that cannot be vested in administrative agencies. “The executive department or the legislature may make the initial determination, but when a party claims a violation of the guarantee in the Bill of Rights that private property may not be taken for public use without just compensation, no statute, decree, or executive order can mandate that its own determination shall prevail over the court’s findings.

In Land Bank of the Philippines v. Heir of Trinidad S. V da. De Arieta : 

In both voluntary and compulsory acquisitions, wherein the landowner rejects the offer, the DAR opens an account in the name of the landowner and conducts a summary administrative proceeding. If the landowner disagrees with the valuation, the matter may be brought to the RTC, acting as a special agrarian court. But as with the DAR-awarded compensation, LBP’s valuation of lands covered by CARL is considered only as an initial determination, which is not conclusive, as it is the RTC, sitting as a Special Agrarian Court, that should make the final determination of just compensation, taking into consideration the factors enumerated in Section 17 of R.A. No. 6657 and the applicable DAR regulations. xxx

2. NO. While R.A. No. 6657 itself does not provide for a period within which a landowner can file a petition for the determination of just compensation before the SAC, it cannot be imprescriptible. Considering that the payment of just compensation is an obligation created by law, it should only be ten (10) years from the time the landowner received the notice of coverage. (Article 1144, NCC).

Nevertheless, any interruption or delay caused by the government like proceedings in the DAR should toll the running of the prescriptive period. In this case, Dalauta received the Notice of Coverage on February 7, 1994.43 He then filed a petition for determination of just compensation on February 28, 2000. Clearly, the filing date was well within the ten year prescriptive period under Article 1141.

Notes: 

Concurrent Exercise of Jurisdiction – 

There may be situations where a landowner, who has a pending administrative case before the DAR for determination of just compensation, still files a petition before the SAC for the same objective. Such recourse is not strictly a case of forum shopping, the administrative determination being not resjudicata binding on the SAC. 

Nevertheless, the practice should be discouraged. To prevent such a messy situation, a landowner should withdraw his case with the DAR before filing his petition before the SAC and manifest the fact of withdrawal by alleging it in the petition itself.