[CASE DIGEST] SPOUSES BATERNA vs. National Transmission Corporation G.R. No. 276920; January 21, 2026, Hernando, J.

 

SPOUSES QUIRINO RONI T. BATERNA AND MARITES M. BATERNA, PETITIONERS, VS. NATIONAL TRANSMISSION CORPORATION, RESPONDENT. [ G.R. No. 276920, January 21, 2026 ]

HERNANDO, J.:

 

Facts:

TRANSCO filed a complaint for expropriation against the petitioners-spuses. Under RA 9136, it took over the electrical transmission functions previously held by the National Power Corporation (NPC) along with the powers and responsibilities granted by law.

The petitioners are the registered owners of two parcels of land, designated as Lots 2192-A and 2192-C, situated in Bo. Buntatala, Jaro, Iloilo City (subject properties) covered by Transfer Certificates of Title (TCT) Nos. 129920 and T-133560, respectively, and collectively encompass an area of 5,185 square meters.

In its Complaint, TRANSCO alleged that in 1979 and 1995, NPC constructed steel towers and transmission lines for Barbara-Baldoza and Sta. Barbara-Ingore 69kV Transmission Lines, which traverse various properties, including the subject properties owned by spouses Baterna, affecting an area of approximately 5,185 square meters. Consequently, to ensure the continued operation, maintenance, and potential future upgrades of said transmission lines, TRANSCO sought to acquire the subject properties, hence filing of the complaint on December 12, 2014.

When efforts to reach a settlement proved unsuccessful, spouses filed a motion to order plaintiff to deposit the amount equivalent to 100% Zonal valuation of Subject properties pursuant to RA No. 10752. The said motion was granted and TRANSCO deposited the amount with LBP.

RTC then directed LBP to release the deposited funds to the spouses, which LBP complied with. RTC ordered the formation of three-member Board of Commissioners to assess and determine the fair market value of the subject properties. The Board of Commissioners submitted their Report that the estimate fair market value at PHP 4,000.00 per square meter, which valued the subject properties at PHP 20,740,000.00 which the RTC approved.

Consequently, TRANSCO moved for reconsideration asking to revoke the Commissioners' Fee on the grounds that it was unconscionable and lacked substantiation and commenting that the just compensation should be determined based on the prevailing fair market value of the subject properties at the time of taking, specifically in 1979 and 1995. Meanwhile, the spouses filed a Supplemental Motion to Conduct a Joint Survey, raising the issue of "dangling areas. These areas referred to portions of the subject properties that had become practically unusable and significantly diminished in value due to their separation from the main lots following the construction of the transmission lines.

Then the Board reconvened and reported that value of the "dangling areas" at PHP 4,000.00 per square meter, which resulted in a total fair market value of PHP 21,584,000.00. Both reports were approved and adopted by the RTC.TRANSCO moved for reconsideration but the same was denied. Thus, it filed an appeal with the CA. The appeal was granted and the case was remanded to the RTC and directed to ascertain, among others, the exact date of the taking of the subject properties. The CA held that a valid taking of the subject properties for purposes of eminent domain occurred prior to the filing of the Complaint. Therefore, just compensation should be based on the fair market value at the time of taking, which occurred sometime in 1979 and 1995. Nonetheless, the CA awarded spouses Baterna exemplary damages and attorneys' fees, citing TRANSCO's prolonged possession of the subject properties without properly initiating expropriation proceeding.

Due to the denial of TRANSCO’s motion for reconsideration, it filed the Petition for Review on Certiorari before the Supreme Court.

Issues:

(1) whether a valid taking of the subject properties occurred in 1979 and 1995, and consequently, whether just compensation should be computed based on (a) the date of taking in 1979 and 1995, or (b) the date of filing of the Complaint on December 12, 2014;

(2) whether consequential damages should be limited to 50% of the BIR zonal valuation of the "dangling areas" or affected properties traversed by the electric transmission lines; and

(3) whether the CA correctly ordered the reconvening or reconstitution of the Board of Commissioners.

 

Ruling:

 The Supreme Court discussed the Complaint was filed on December 12, 2014, prior to the effectivity of Republic Act No. 10752 and Republic Act. No. 12289. However, no written agreement on the purchase price had been executed between the parties at that time. It was only in 2017 that respondent deposited 100% of the value of the subject properties, based on the prevailing zonal valuation of the BIR, and the Board of Commissioners was constituted to determine just compensation.

Moreover, the deposit of the provisional value occurred in July 2016, after the effectivity of Republic Act No. 10752. This act—being a prerequisite for the government to take possession—was performed under the regime of Republic Act No. 10752. Therefore, the transaction is deemed "ongoing" and not "concluded satisfactorily" within the meaning of the transitory clause, thereby rendering Republic Act No. 10752, as amended by Republic Act No. 12289 applicable.

Therefore, Republic Act No. 10752, as amended by Republic Act No. 12289, thus provides the governing standard for determining the fair market value of the subject properties as the statutory basis for fixing just compensation in this case. 

Reckoning point for the determination of just compensation

Accordingly, a clear distinction must be drawn between statutory valuation and the judicial determination of just compensation. Republic Act No. 10752, as amended by Republic Act No. 12289, governs the computation of the provisional deposit and the fair market value required for the expropriating agency to obtain possession. Rule 67 of the Rules of Court, on the other hand, governs the judicial determination of just compensation.

Under Rule 67, Section 4, just compensation must be reckoned "as of the date of the taking of the property or the filing of the complaint, whichever came first." Neither Republic Act No. 10752 nor Republic Act No. 12289 contains any provision that modifies or supersedes this rule.

Thus, Rule 67, Section 4 remains controlling: just compensation is determined "as of the date of the taking of the property or of the filing of the complaint, whichever came first." and not Republic Act No. 10752, as amended by Republic Act No. 12289 which mandates the use of the current fair market value at the commencement of expropriation proceedings.

In this regard, petitioners seek to anchor the reckoning point on the filing of the Complaint, contending that no valid taking occurred in the context of the State's power of eminent domain. This argument is untenable.

The Court's landmark ruling in Republic v. Vda. de Castellvi defines the requisites of taking:

First, the expropriator must enter a private properly...

Second, the entrance into private property must be for more than a momentary period...

Third, the entry into the property should be under warrant or color of legal authority...

Fourth, the property must be devoted to a public use or otherwise informally appropriated or injuriously affected...[and]

Fifth, the utilization of the property for public use must be in such a way as to oust the owner and deprive him of all beneficial enjoyment of the property. (

Undisputedly, respondent installed its transmission lines on the subject properties in 1979 and 1995. Petitioners' own demand letter dated October 16, 2014 demonstrates their knowledge and long-standing tolerance of these lines. There has been no categorical denial that these transmission lines were constructed on the subject properties during these years.

 

The requisite of taking is clearly present in this case, as the construction of permanent transmission lines necessarily entails an indefinite occupation of the subject properties. In addition, respondent's exercise of eminent domain is firmly anchored on its statutory authority under Republic Act No. 9136, in relation to Republic Act No. 10752, as amended by Republic Act No. 12289. Finally, it must be emphasized that petitioners have, in fact, been deprived of the beneficial enjoyment of their properties.

 

Thus, despite petitioners' supposed continued tax payments, the perpetual and restrictive presence of high-tension transmission lines significantly impairs the normal use and enjoyment of the subject properties, constituting a compensable deprivation of beneficial enjoyment. Since there was a valid taking of the subject properties, it is therefore clear that the reckoning point for determining just compensation must be the date of taking, which in this case occurred upon the installation of the transmission lines in 1979 and 1995, pursuant to Rule 67, Section 4 of the Rules of Court.

 

The Court upheld that just compensation is determined by the property's value at the time of taking, particularly when the government appropriated the properties before the initiation of expropriation proceedings. Notably, in Heirs of Dimao v. National Grid Corporation of the Philippines and Heirs of Cipriano v. National Transmission Corporation, the Court ruled that the proper reckoning point for determining just compensation is the date of taking by TRANSCO—specifically when it constructed the transmission lines on the property—and not the date when the expropriation proceedings were instituted.

Award of consequential damages, exemplary damages, and attorney's fees

The Supreme Court held that “Dangling” areas are portions of land not traversed by the transmission line project but rendered useless due to the presence of transmission lines as defined under National Power Board Resolution No. 94-313. In this regard, both petitioners and respondent do not dispute the extent of these dangling areas nor the award of consequential damages by the CA arising from the impairment or diminution in value caused by the construction of respondent's transmission lines on the subject properties.

The SC disagrees with the Petitioner’s argument that consequential damaged should not be computed at 50% of the BIR zonal valuation instead on the full market value of the dangling areas. The Court held that Petitioners failed to present reliable and actual evidence to support the valuation adopted by the Board of Commissioners, which pegged damages at full market value—an amount that is not only unsupported but even exceeds the recommended just compensation for the property actually expropriated. Moreover, jurisprudence has consistently maintained that consequential damages in analogous cases are set at 50% of the BIR zonal valuation for properties affected by electric transmission lines. Thus, in National Power Corporation v. Marasigan, the Court granted consequential damages to the property owners due to impairment or reduction in value of their remaining properties following expropriation. Consequently, the Court awarded damages equivalent to 50% of the BlR zonal valuation of the property impacted by the transmission lines.

Accordingly, the Court affirms the CA's award of consequential damages equivalent to 50% of the BIR zonal valuation of the "dangling areas." Likewise, the Court upholds the CA's award of exemplary damages and attorney's fees. The Court has previously granted exemplary damages and attorney's fees in cases where property owners were deprived of beneficial ownership of their properties without appropriate expropriation proceedings. Since petitioners have not challenged this award, We affirm the amount of PHP 200,000.00 in exemplary damages, along with attorney's fees set at 1% of the total amount due to the petitioners. 

The Board of Commissioners can reconvene or reconstitute 

The Court finds no error in the CA's directive to reconvene or reconstitute the Board of Commissioners. Rule 67, Section 8 of the Rules of Court expressly authorizes the trial court to "recommit" matters to commissioners or "appoint new commissioners" when necessary to ensure that just compensation is determined in accordance with law.

Because Rule 67 vests the trial court with the power to recommit or appoint new commissioners, the CA, including this Court, may likewise direct the RTC to reconvene or reconstitute the Board of Commissioners, or even appoint a new one, when circumstances so require. In this case, such necessity is evident. First, the determination of just compensation cannot proceed without ascertaining the precise date of taking of the subject properties—whether in 1979 or 1995—as this directly affects the computation of just compensation. Second, the amount of just compensation must be computed in accordance with the present value formula laid down in Spouses Nocom, Heirs of Mariano, and Heirs of Cipriano. Third, there is a need to determine consequential damages, which should be limited to 50% of the BIR zonal valuation of the "dangling areas" or affected properties segregated by respondent's transmission lines. Finally, the number of days devoted by the Board of Commissioners in preparing their reports must be ascertained to fix their fees pursuant to Rule 141, Section 16 of the Rules of Court.

These considerations make it imperative to remand the case to the RTC for the reconstitution or reconvening of the Board of Commissioners. This step is essential to address key factual and legal issues—the exact date of taking, the computation of just compensation under the present value formula, the determination of consequential damages, and the assessment of commissioners' fees—in accordance with the Rules of Court and prevailing jurisprudence.

Decision of the Supreme Court : The Petition is partially granted, decision and resolution of the Court of Appeals are affirmed with modification. The case was remanded to the RTC and directed to reconstitute or reconvene the Board of Commissioner or appoint a new board if necessary to:

1. Determine the precise date of taking of the subject properties;

2. Compute the amount of just compensation in accordance with the present value formula laid down in Spouses Nocom v. National Transmission Corporation, Heirs of Mariano v. National Transmission Corporation, and Heirs of Cipriano v. National Transmission Corporation;

3. Determine consequential damages, which shall be limited to 50% of the BIR zonal valuation of the affected properties segregated by the electrical transmission lines; and

4. Ascertain the number of days devoted by the Board of Commissioners in preparing their reports for purposes of fixing their fees pursuant to Rule 141, Section 16 of the Rules of Court.

Respondent was ordered to pay the Petitioners exemplary damages PHP 200,000.00 and attorney's fees equivalent to 1% of the total amount due to petitioners.

Takeaway: Exemplary damages and attorney’s fee may be awarded to the petitioners when there was no expropriation proceeding filed by the government