National Power Corporation vs. Paderanga

A record on appeal is required in expropriation cases because they involve multiple or separate appeals from the order of condemnation and the subsequent determination of just compensation. Furthermore, the acquisition of a right-of-way easement that perpetually deprives the owner of ordinary use of the property constitutes a taking under the power of eminent domain, entitling the owner to just compensation based on the nature and character of the land at the time of taking, not merely 10% of the market value as provided under Section 3A of R.A. No. 6395.

To implement its Leyte-Cebu Interconnection Project, the National Power Corporation (NPC) sought to expropriate parcels of land situated in Carmen, Cebu, for the installation of transmission lines. The targeted properties included land co-owned by Petrona O. Dilao and her siblings, and land owned by Estefania Enriquez. NPC sought only a right-of-way easement over the traversed portions, asserting that the land could still be used for agricultural purposes subject to the easement, and that just compensation should be limited to 10% of the market value pursuant to its charter.

• Expropriation Complaint: On March 19, 1996, NPC filed a complaint for expropriation against Dilao and her siblings, and Enriquez, seeking a right-of-way easement over 7,281 square meters of the Dilao property and 7,879 square meters of the Enriquez property for the Leyte-Cebu Interconnection Project.
• Pleadings: Dilao et al. filed an Answer with Counterclaim. Enriquez did not file an answer but manifested no opposition to the right of use, demanding only that payment be based on the actual market value.
• Commissioners' Report and RTC Decision: The RTC appointed a Board of Commissioners, which recommended an appraisal of ₱516.66 per square meter for the Dilao property. By Decision of November 10, 1999, the RTC adopted the commissioners' recommendation, ordering NPC to pay ₱3,761,801.40 for the land plus ₱250,000.00 for affected improvements. The dispositive portion referred to the property of "Petrona Dilao et al."
• Procedural Deadlock: NPC filed a notice of appeal but failed to file a record on appeal. The RTC denied the appeal for failure to perfect it within the reglementary period. NPC moved for reconsideration, arguing that a record on appeal was unnecessary because Enriquez had not answered, precluding multiple appeals. The RTC denied the motion, clarifying that "Petrona Dilao et al." referred only to Dilao and her co-owner-siblings. The RTC subsequently denied NPC's petition for relief and granted Dilao et al.'s motion for execution.
• Appellate Review: NPC filed a petition for certiorari in the Court of Appeals, assailing the RTC orders. The CA denied the petition, holding that a record on appeal is required in expropriation cases, which involve multiple or separate appeals.

• Procedural Requirement: Petitioner argued that a complaint for expropriation is a special civil action, not a special proceeding, and no rule specifically requires a record on appeal in such cases. It maintained that because Enriquez did not file an answer and was not served summons, no appeal could arise from the case against her, negating any possibility of multiple appeals.
• Just Compensation: Petitioner asserted that the commissioners' appraisal was overvalued because it failed to apply Section 3A of R.A. No. 6395, which limits just compensation for a right-of-way easement to 10% of the market value. It argued that the traversed land could still be used for agricultural purposes subject only to the easement.

• Procedural Requirement: Respondents countered that under Rule 41, Section 2 of the Rules of Civil Procedure, a record on appeal is required in cases of multiple or separate appeals, which includes expropriation proceedings.
• Just Compensation: Respondents argued that the right-of-way easement perpetually deprived them of their proprietary rights, restricted agricultural and economic activity, and exposed them to danger, thereby constituting a taking requiring full just compensation based on the nature and character of the land at the time of taking.

• Procedural Requirement: Whether a record on appeal is required in an expropriation case.
• Possibility of Multiple Appeals: Whether the failure of a defendant to file an answer forecloses the possibility of multiple appeals in an expropriation case.
• Measure of Just Compensation: Whether just compensation for a right-of-way easement is limited to 10% of the market value of the property under Section 3A of R.A. No. 6395.

• Procedural Requirement: A record on appeal is required in expropriation cases because they fall under "other cases of multiple or separate appeals" pursuant to Rule 41, Section 2(a). Jurisprudence recognizes two distinct stages in expropriation—determination of the right to expropriate and determination of just compensation—each capable of separate appeals.
• Possibility of Multiple Appeals: The failure of a defendant to file an answer does not foreclose the possibility of an appeal. Under Rule 67, Section 3, a defendant who does not answer may still present evidence on the issue of just compensation and appeal the court's determination thereof. Multiple appeals remain possible regardless of a default in answering.
• Measure of Just Compensation: Just compensation is not limited to 10% of the market value under Section 3A of R.A. No. 6395. A right-of-way easement that perpetually deprives the owner of ordinary use—by restricting plant height, posing danger to life and limb, and requiring continuous tax payments—constitutes a taking under eminent domain. Just compensation is a judicial function determined by the nature and character of the land at the time of taking, and the factual findings of the appellate court on valuation are binding absent a showing that the valuation is exorbitant or unjustified.

• Two Stages of Expropriation — An action for expropriation consists of two stages: (1) determination of the authority of the plaintiff to exercise the power of eminent domain and the propriety of its exercise, ending in an order of condemnation or dismissal; and (2) determination of just compensation with the assistance of commissioners. Each stage can be subject to a separate appeal.
• Taking Under Eminent Domain — The power of eminent domain is not limited to the acquisition of title or possession; it may be availed of to impose only a burden upon the owner of condemned property. A right-of-way easement that perpetually deprives the owner of ordinary use and imposes indefinite restrictions constitutes a taking.
• Judicial Determination of Just Compensation — The determination of just compensation in expropriation proceedings is a judicial function. The nature and character of the land at the time of its taking is the principal criterion to determine just compensation. Factual findings of the Court of Appeals on valuation are binding absent a showing that the valuation is exorbitant or unjustified.

• "Normally, of course, the power of eminent domain results in the taking or appropriation of title to, and possession of, the expropriated property; but no cogent reason appears why said power may not be availed of to impose only a burden upon the owner of condemned property, without loss of title and possession."
• "It is the nature and character of the land at the time of its taking that is the principal criterion to determine just compensation to the landowner."

• Municipality of Biñan v. Garcia, 180 SCRA 576 (1989) — Followed. Established the two stages of expropriation and the availability of multiple appeals, justifying the requirement of a record on appeal.
• National Power Corporation v. Chiong, 404 SCRA 527 (2003) — Followed. Held that just compensation is based on the nature and character of the land at the time of taking, and the factual findings of the CA on valuation are binding.
• National Power Corporation v. Gutierrez, 193 SCRA 1 (1991) — Followed. Held that a right-of-way easement perpetually depriving owners of ordinary use constitutes a taking under eminent domain.

• Rule 41, Section 2(a), 1997 Rules of Civil Procedure — Requires the filing of a record on appeal in special proceedings and other cases of multiple or separate appeals. Applied to justify the dismissal of NPC's appeal for failure to file a record on appeal.
• Rule 67, Section 3, 1997 Rules of Civil Procedure — Allows a defendant who did not file an answer to present evidence on just compensation and share in the award. Applied to show that multiple appeals remain possible even if a defendant does not answer.
• Section 3A, Republic Act No. 6395 (as amended by P.D. No. 938) — Provides that just compensation for a right-of-way easement shall not exceed 10% of the market value. Interpreted not to strictly limit compensation when the easement amounts to a taking that perpetually deprives the owner of ordinary use.

Panganiban (Chairman), Sandoval-Gutierrez, and Corona, JJ.