National Power Corporation vs. Felicisimo Tarcelo and Heirs of Comia Santos

A writ of execution must conform strictly to the dispositive portion of the final judgment; where the dispositive portion decrees payment of just compensation only for the affected portions of the condemned land, an execution that compels payment for the entire property is null and void.

National Power Corporation (NPC) is a government-owned and controlled corporation vested with the power of eminent domain, which it exercised in constructing and maintaining its 1,200 MW Ilijan Natural Gas Pipeline Project. Respondents Felicisimo Tarcelo and the heirs of Comia Santos owned adjoining agricultural lots in Brgy. Tabangao-Ambulong, Batangas City, measuring 4,404 and 2,611 square meters, respectively. Republic Act No. 6395, as amended, the NPC charter, fixes the compensation for a mere right-of-way easement at ten percent of the property's fair market value — the statutory measure against which the commissioners and the courts below weighed the full market value of the affected land.

Respondents Felicisimo Tarcelo and the heirs of Comia Santos owned two adjoining agricultural lots in Brgy. Tabangao-Ambulong, Batangas City, measuring 4,404 and 2,611 square meters, respectively. In 2000, the National Power Corporation (NPC) filed Civil Case No. 5785 with the Regional Trial Court of Batangas City, Branch VII, seeking to expropriate portions of those lots — a total of 1,595.91 square meters — that would be traversed by the construction and maintenance of its 1,200 MW Ilijan Natural Gas Pipeline Project. On July 29, 2002, the trial court issued an order of condemnation authorizing NPC to take possession of the subject lots, and thereafter appointed three commissioners to determine just compensation.

The commissioners submitted conflicting reports. Commissioner Emelinda C. Atienza recommended P1,120.00 per square meter, based on the average value per the findings of the Committee composed of the City Assessor, City Treasurer, and City Engineer under Resolution No. 9-99 dated June 18, 1999, which placed the property at P1,000.00 to P1,300.00 per square meter, and on the opinion value of her team's survey and report showing that the prevailing price of agricultural land in Tabangao-Ambulong, Batangas City was P930.00 per square meter. Her recommendation expressly limited compensation to the "affected areas on the properties involved." Commissioners Alberto M. Nuique and Eladio R. Taupa, for their part, recommended P475.00 per square meter — ten percent of the fair market value pursuant to Republic Act No. 6395, as amended — on the theory that only a right-of-way easement would be acquired. Their reports likewise limited the payment to the "affected portion" of the land.

On November 7, 2005, the trial court rendered its Decision fixing just compensation at P1,000.00 per square meter. Its dispositive portion ordered NPC to pay the defendants that amount per square meter and, upon payment, granted NPC "a lawful right to enter, take possession and acquire easement of right-of-way over the portions of the properties together with the improvements sought to be expropriated." The trial court also directed NPC to pay commissioner's fees. NPC appealed to the Court of Appeals in CA-G.R. CV No. 86712. On June 26, 2007, the appellate court affirmed the trial court's Decision with modification, lowering the just compensation to P797.50 per square meter — the average of the P475.00 and P1,120.00 figures in the commissioners' reports. In so ruling, it held that respondents were entitled to the full market value of their property and not merely ten percent thereof, reasoning that the construction of the underground pipeline would cause damage and prejudice to the agricultural potential of the land, requiring deep excavation, uprooting plants and trees, and creating an environmental health hazard. The CA Decision became final and executory, and entry of judgment was made accordingly.

Respondents then moved for execution. In a March 6, 2009 Order, the trial court granted their motions and issued a Writ of Execution. On May 14, 2009, a Notice of Garnishment was served on the Manager of the Land Bank of the Philippines, NPC Branch, Quezon City, for the satisfaction of P5,594,462.50 — representing just compensation for the whole of respondents' 4,404- and 2,611-square meter lots, or 7,015 square meters, rather than the affected portions totaling 1,595.91 square meters that NPC had originally sought to acquire.

On May 29, 2009, NPC filed an Urgent Omnibus Motion seeking to quash the Writ of Execution and Notice of Garnishment as inconsistent with the trial court's November 7, 2005 Decision and the CA's June 26, 2007 Decision. It argued that the appeal in CA-G.R. CV No. 86712 resolved only whether respondents should be paid the full market value of the affected 1,595.91-square meter area or merely a ten percent easement fee, and did not decide whether NPC should pay for the entire 7,015 square meters. On September 24, 2009, the trial court denied the motion, holding that the entire area of respondents' properties had become useless to them and useful only to NPC, and that NPC must therefore pay the full market value of the entire properties. It ordered the sheriff to enforce the Writ of Execution and Notice of Garnishment. NPC's Motion for Reconsideration was denied in an October 23, 2009 Order on the ground that it lacked a notice of hearing and was thus a mere scrap of paper that did not toll the period to appeal.

The trial court's factual findings, as affirmed by the CA, thus treated respondents' properties as a whole in resolving the case, and the CA found nothing in the November 7, 2005 Decision indicating that NPC was ordered to pay just compensation only for the 1,595.91-square meter portion.

• Scope of Just Compensation: NPC argued that while it did not dispute its liability to respondents, the Sheriff's computation as reflected in the Notice of Garnishment was erroneous because it was being made to pay more than what was adjudged; just compensation should be limited to the value of the portion so taken, and not the entire property of which such portion formed part. It cited cases where the computation and payment of just compensation was limited to the value of the affected portions only.
• Liberality in Motions: NPC pleaded for liberality in respect of its Motion for Reconsideration of the trial court's September 24, 2009 Order, which was denied via the October 23, 2009 Order for lack of the required notice of hearing, insisting that since the trial court's dispositions were irregular and inconsistent with the CA's Decision in CA-G.R. CV No. 86712, justice dictated that the technical rules on motions should give way to considerations of equity.
• Inconsistency of Execution with Judgment: NPC maintained that the inclusion of the whole property instead of only the affected portions thereof would render the execution process in Civil Case No. 5785 unjust and inequitable, and that the issue of whether it should be made to pay for the whole 7,015-square meter area was never raised in CA-G.R. CV No. 86712.

• Entire Property Rendered Useless (Santos heirs): The Santos heirs restated the assailed CA Decision and added that while NPC sought a mere right-of-way for its pipelines, their property would be rendered useless by the toxic fumes and hazardous substances that could be emitted by such pipelines; their situation was akin to that of the landowner in National Power Corporation vs. Manubay Agro-Industrial Development Corporation, who was adjudged entitled to the full value of the property and not a mere easement fee.
• No Ground for Liberality (Santos heirs): NPC could not claim liberality in the application of the Rule on motions because there existed no special or compelling circumstances to warrant relaxation of the rule; NPC's failure was the result of fault and negligence on its part, and it had not shown to the satisfaction of the court that it was entitled to leniency.
• No Inconsistency Between Decisions (Tarcelo): Respondent Tarcelo argued that there was no inconsistency between the trial court's November 7, 2005 Decision and the CA's June 26, 2007 Decision on the one hand, and the trial court's September 24, 2009 and October 23, 2009 Orders and the March 9, 2009 Writ of Execution and May 14, 2009 Notice of Garnishment on the other; that the trial court and the CA treated respondents' properties as a whole or in their entirety in resolving the cases before them.
• NPC's Awareness and Propriety of Denial (Tarcelo): NPC already knew beforehand that it was being ordered to pay just compensation for the entirety of respondents' properties and not mere portions thereof; and the trial court correctly denied NPC's Motion for Reconsideration of the September 24, 2009 Order for lack of a notice of hearing.

• Scope of Execution: Whether the Court of Appeals erred in upholding the trial court's Orders approving the Notice of Garnishment which demanded payment of just compensation for the entire property of respondents instead of the affected portions only, in accordance with the complaint and the trial court's Decision.
• Liberality in the Application of the Rules: Whether the Court of Appeals erred in upholding the Order of the trial court which denied petitioner's Motion for Reconsideration in complete disregard of the liberality enunciated in several decisions of the Supreme Court.

• Scope of Execution: No. The Court of Appeals erred. The dispositive portion of the November 7, 2005 Decision, as affirmed with modification by the final and executory June 26, 2007 Decision, decreed payment of just compensation only for the affected portions of respondents' properties, totaling 1,595.91 square meters; the Notice of Garnishment covering the whole 7,015 square meters is null and void.
• Liberality in the Application of the Rules: The issue is rendered irrelevant. The September 24, 2009 Order being null and void on the matter covering the Notice of Garnishment, NPC's failure to include a notice of hearing in its Motion for Reconsideration of that Order has no bearing on the resolution of the case.

• Scope of Execution: The exercise of the right of eminent domain is necessarily in derogation of private rights and is one of the harshest proceedings known to the law; the authority to condemn is strictly construed in favor of the owner and against the condemnor, and the extent to which the power may be exercised is limited to the express terms or clear implication of the statute granting it. Trial courts should exercise care and circumspection in the resolution of just compensation cases, considering that they involve the expenditure of public funds. The Commissioners' Reports in Civil Case No. 5785 indicated that only the affected areas were intended to be acquired and compensated: Commissioner Atienza recommended P1,120.00 per square meter "to compensate the affected areas on the properties involved," while Commissioners Nuique and Taupa recommended that "only easement fee be made as the payment on the affected portion" of the land. The trial court itself particularly decreed in its November 7, 2005 Decision that only the affected portions were to be acquired and compensated, ordering NPC to pay P1,000.00 per square meter and, upon payment, granting NPC "a lawful right to enter, take possession and acquire easement of right-of-way over the portions of the properties together with the improvements sought to be expropriated." The CA therefore patently erred in declaring that there was nothing in the November 7, 2005 Decision to indicate that NPC was being ordered to pay just compensation only for the 1,595.91-square meter portion of respondents' properties; the evidence was quite clear that NPC had been made liable precisely to such extent only, and not more. Contrary to the CA's appreciation, the June 26, 2007 Decision in CA-G.R. CV No. 86712 did not particularly declare that NPC should pay for the entire area of respondents' properties; it merely stated that respondents should be compensated for the full and fair market value of their property and not merely paid a ten percent easement fee therefor, and did not resolve the issue of whether NPC should pay just compensation for the entire area of 7,015 square meters. The issue of whether NPC should be made to pay for the whole 7,015-square meter area was not at all raised; besides, in arriving at its judgment, the CA took into full consideration the Commissioners' Reports, which recommended the payment of just compensation only for the affected portions. It has always been the rule that the only portion of the decision that may be the subject of execution is that which is ordained or decreed in the dispositive portion; whatever may be found in the body of the decision can only be considered as part of the reasons or conclusions and serves only as a guide to determine the ratio decidendi. Where there is a conflict between the dispositive portion of the decision and the body thereof, the dispositive portion controls irrespective of what appears in the body of the decision. An order of execution is based on the disposition, not on the body, of the decision. Since there is a disparity between the dispositive portion of the trial court's November 7, 2005 Decision as affirmed with modification by the final and executory June 26, 2007 Decision of the CA — which decreed that respondents be paid just compensation only for the affected portions of their properties, totaling 1,595.91 square meters — and the Notice of Garnishment for the satisfaction of P5,594,462.50 representing just compensation for the whole 7,015 square meters, the latter must be declared null and void. A writ of execution must conform substantially to every essential particular of the judgment promulgated; execution not in harmony with the judgment is bereft of validity. The Batangas City RTC's September 24, 2009 and October 23, 2009 Orders are likewise declared null and void in regard only to the Notice of Garnishment, as it countermands the decretal portion of the November 7, 2005 Decision and completely changes its tenor by holding NPC liable to pay for the value of the whole of respondents' properties; all proceedings held for the purpose of amending or altering the dispositive portion of the trial court's November 7, 2005 Decision, as affirmed with modification by the CA's final and executory June 26, 2007 Decision, are null and void for lack of jurisdiction. Once a decision or order becomes final and executory, it is removed from the power or jurisdiction of the court which rendered it to further alter or amend it; it thereby becomes immutable and unalterable, and any amendment or alteration which substantially affects a final and executory judgment is null and void for lack of jurisdiction, including the entire proceedings held for that purpose. An order of execution which varies the tenor of the judgment or exceeds the terms thereof is a nullity.
• Liberality in the Application of the Rules: The failure of NPC to include a notice of hearing in its Motion for Reconsideration of the trial court's September 24, 2009 Order has been rendered irrelevant considering the pronouncement that the said Order is null and void on the matter covering the Notice of Garnishment. A void judgment or order has no legal and binding effect, force or efficacy for any purpose; in contemplation of law, it is non-existent. Such judgment or order may be resisted in any action or proceeding whenever it is involved, and it is not even necessary to take any steps to vacate or avoid a void judgment or final order; it may simply be ignored.

• Execution must conform to the dispositive portion of the decision — The only portion of a decision that may be the subject of execution is that which is precisely ordained or decreed in the dispositive portion; whatever is in the body of the decision can only be considered as part of the reasons or conclusions and serves as a guide in determining the ratio decidendi. A writ of execution must conform substantially to every essential particular of the judgment promulgated, and execution not in harmony with the judgment is bereft of validity. In this case, because the dispositive portion of the November 7, 2005 Decision, as affirmed with modification by the final and executory June 26, 2007 Decision, decreed compensation only for the affected portions totaling 1,595.91 square meters, the Notice of Garnishment covering the whole 7,015 square meters was declared null and void.
• Dispositive portion controls over the body of the decision — Where there is a conflict between the dispositive portion of the decision and the body thereof, the dispositive portion controls irrespective of what appears in the body of the decision. While the body of the decision, order, or resolution might create some ambiguity in the manner of the court's reasoning, it is the dispositive portion thereof that finally invests rights upon the parties, sets conditions for the exercise of those rights, and imposes corresponding duties or obligations. An order of execution is based on the disposition, not on the body, of the decision. The Court applied this rule in holding that the CA erred in reading the body of the November 7, 2005 Decision as supporting an award for the entire property when the decretal portion expressly limited the easement of right-of-way to the affected portions.
• Immutability of final judgments — Once a decision or order becomes final and executory, it is removed from the power or jurisdiction of the court which rendered it to further alter or amend it. It thereby becomes immutable and unalterable, and any amendment or alteration which substantially affects a final and executory judgment is null and void for lack of jurisdiction, including the entire proceedings held for that purpose. An order of execution which varies the tenor of the judgment or exceeds the terms thereof is a nullity. The Court applied this doctrine in declaring null and void all proceedings held for the purpose of amending or altering the dispositive portion of the November 7, 2005 Decision, as affirmed with modification by the final and executory June 26, 2007 Decision.
• Void judgments have no legal effect — A void judgment or order has no legal and binding effect, force, or efficacy for any purpose; in contemplation of law, it is non-existent. Such judgment or order may be resisted in any action or proceeding whenever it is involved, and it is not even necessary to take any steps to vacate or avoid a void judgment or final order; it may simply be ignored. This doctrine rendered irrelevant NPC's failure to include a notice of hearing in its Motion for Reconsideration of the September 24, 2009 Order.
• Eminent domain is strictly construed against the condemnor — The exercise of the right of eminent domain, whether directly by the State or by its authorized agents, is necessarily in derogation of private rights and is one of the harshest proceedings known to the law. The authority to condemn is to be strictly construed in favor of the owner and against the condemnor, and when the power is granted, the extent to which it may be exercised is limited to the express terms or clear implication of the statute in which the grant is contained. Trial courts should exercise care and circumspection in the resolution of just compensation cases, considering that they involve the expenditure of public funds. The Court invoked these principles in faulting both the trial and appellate courts for having lost sight of them.

• "Execution must always conform to that decreed in the dispositive part of the decision, because the only portion thereof that may be the subject of execution is that which is precisely ordained or decreed in the dispositive portion; whatever is in the body of the decision can only be considered as part of the reasons or conclusions and serves as a guide in determining the ratio decidendi." — This passage states the ratio decidendi of the case and is the canonical formulation of the rule that execution is confined to the dispositive portion; it is the doctrinal anchor for the nullification of the Notice of Garnishment.
• "[W]here there is a conflict between the dispositive portion of the decision and the body thereof, the dispositive portion controls irrespective of what appears in the body of the decision. While the body of the decision, order or resolution might create some ambiguity in the manner of the court's reasoning preponderates, it is the dispositive portion thereof that finally invests rights upon the parties, sets conditions for the exercise of those rights, and imposes corresponding duties or obligation." — This excerpt defines the hierarchy between the fallo and the body of a decision and is frequently cited in subsequent jurisprudence on the scope of execution.
• "Once a decision or order becomes final and executory, it is removed from the power or jurisdiction of the court which rendered it to further alter or amend it. It thereby becomes immutable and unalterable and any amendment or alteration which substantially affects a final and executory judgment is null and void for lack of jurisdiction, including the entire proceedings held for that purpose. An order of execution which varies the tenor of the judgment or exceeds the terms thereof is a nullity." — This passage articulates the doctrine of immutability of final judgments and supplies the jurisdictional basis for declaring the trial court's September 24, 2009 and October 23, 2009 Orders null and void.
• "A void judgment or order has no legal and binding effect, force or efficacy for any purpose. In contemplation of law, it is non-existent. Such judgment or order may be resisted in any action or proceeding whenever it is involved. It is not even necessary to take any steps to vacate or avoid a void judgment or final order; it may simply be ignored." — This excerpt defines the effect of a void order and explains why NPC's omission of a notice of hearing in its Motion for Reconsideration was rendered irrelevant.

• National Power Corporation vs. Alonzo-Legasto, 485 Phil. 732 (2004) — Cited as the source of the rule that only the portion of the decision ordained or decreed in the dispositive portion may be the subject of execution, and that whatever is in the body serves only as a guide to determine the ratio decidendi.
• Florentino vs. Rivera, 515 Phil. 494 (2006) — Cited for the rule that where there is a conflict between the dispositive portion of the decision and the body thereof, the dispositive portion controls irrespective of what appears in the body.
• PH Credit Corporation vs. Court of Appeals, 421 Phil. 821 (2001) — Cited for the rule that an order of execution is based on the disposition, not on the body, of the decision.
• Solidbank Corporation vs. Court of Appeals, 428 Phil. 949 (2002) — Cited for the rule that a writ of execution must conform substantially to every essential particular of the judgment promulgated, and that execution not in harmony with the judgment is bereft of validity.
• Gagui vs. Dejero, G.R. No. 196036, October 23, 2013 — Cited for the doctrine of immutability of final judgments and for the rule that any amendment or alteration substantially affecting a final and executory judgment is null and void for lack of jurisdiction, including the entire proceedings held for that purpose.
• Land Bank of the Philippines vs. Orilla, G.R. No. 194168, February 13, 2013, 690 SCRA 610 — Cited for the rule that a void judgment or order has no legal and binding effect, force, or efficacy for any purpose and may simply be ignored.
• National Power Corporation vs. Manubay Agro-Industrial Development Corporation, 480 Phil. 470 (2004) — Cited by the trial court and the CA for the ruling that even if only an easement of right-of-way is acquired, the condemnor should pay the full value of the property and not a mere easement fee; the Court clarified that this ruling did not authorize compensation for the entire property.
• National Power Corporation vs. Court of Appeals, 436 SCRA 195 (2001) — Cited by the trial court for the ruling that NPC took not only the portion traversed by its facilities but also the remaining area of the property where the entire property had been rendered useless to the owner; the Court distinguished this precedent from the present case.
• Jesus is Lord Christian School Foundation, Inc. vs. Municipality (now City) of Pasig, Metro Manila, 503 Phil. 845 (2005) — Cited for the principle that the authority to condemn is strictly construed in favor of the owner and against the condemnor, and that the extent of the power is limited to the express terms or clear implication of the statute granting it.
• National Power Corporation vs. Diato-Bernal, G.R. No. 180979, December 15, 2010, 638 SCRA 660 — Cited for the principle that trial courts should exercise care and circumspection in the resolution of just compensation cases, considering that they involve the expenditure of public funds.
• La Campana Development Corporation vs. Development Bank of the Philippines, 598 Phil. 612 (2009) and Policarpio vs. Philippine Veterans Board, 106 Phil. 125 (1959) — Cited by the CA for the rule that a decision should be taken as a whole and considered in its entirety to get the true meaning and intent of any particular portion thereof.

• Republic Act No. 6395, as amended — The NPC charter, cited by Commissioners Nuique and Taupa as the basis for recommending that only an easement fee equivalent to ten percent of the fair market value be paid for the affected portion of the agricultural land. The Court noted that the commissioners' reports, including this statutory measure, uniformly limited compensation to the affected portions.
• Bangko Sentral ng Pilipinas-Monetary Board Circular No. 799, Series of 2013 — Cited in the dispositive portion as the basis for the interest on the just compensation: twelve percent per annum from July 29, 2002 up to June 30, 2013, and six percent per annum from July 1, 2013 until full satisfaction.
• Rule 15, Sections 4, 5, and 6, Rules of Court — Cited by the Santos heirs in arguing that NPC could not claim liberality in the application of the Rule on motions; the trial court and the CA had treated NPC's Motion for Reconsideration as a mere scrap of paper for lack of a notice of hearing. The Court held the point irrelevant because the assailed September 24, 2009 Order was void on the matter covering the Notice of Garnishment.

Carpio (Acting Chief Justice), Brion, Villarama, Jr., and Leonen, JJ., concurred.