Buot vs. National Transmission Corporation

Power and transmission lines are “similar works” within the general clause of Section 112 of the Public Land Act, such that a legal easement of right‑of‑way not exceeding 60 meters in width may be enforced on lands originally granted by free patent without payment for the land itself, only damages for affected improvements; the property owner is nevertheless entitled to consequential damages for any remaining portion outside the 60‑meter easement that is rendered unusable or uninhabitable by the transmission lines.

Spouses Buot owned a 117,850‑square‑meter parcel in Sibonga, Cebu, originally public land and conveyed to them via free patent. Their Torrens title expressly carried the reservations and easements mandated by Sections 109, 110, 111, 112, 113, 114, 118, 121, 122, and 124 of Commonwealth Act No. 141 (The Public Land Act). The National Transmission Corporation (Transco), later substituted by the National Grid Corporation of the Philippines (NGCP), sought to acquire a 196‑square‑meter portion and to enforce a right‑of‑way easement over 7,382 square meters for the Naga‑Suba 138KV transmission line upgrading project.

• Nature and Title of the Property: Spouses Buot are registered owners of Lot No. 1415, Cad‑315‑D, a 117,850‑square‑meter parcel in Abugon, Sibonga, Cebu, classified as agricultural in its tax declaration and covered by TCT No. P‑2260. The land was originally registered under Original Certificate of Title No. 4156, issued pursuant to a free patent granted on April 18, 1969. The title contained an annotation stating that the land is subject to the provisions of the Public Land Act, specifically Sections 109, 110, 111, 112, 113, 114, 118, 121, 122, and 124, and to any subsisting conditions in the original title.
• The Project and the Taking: To implement the Naga‑Suba 138KV T/L Upgrading Project, Transco filed a complaint for expropriation to acquire a 196‑square‑meter portion of the property and to enforce an easement of right‑of‑way over 7,382 square meters. The transmission lines would occupy a corridor 30 meters in width, totaling 7,382 square meters, well within the 60‑meter maximum under Section 112.
• Opposition and Claim of Total Taking: Spouses Buot opposed, contending that the hazards of the transmission lines would render the entire 117,850‑square‑meter property useless and seeking just compensation for the whole lot.
• Commissioners’ Proceedings and Provisional Value: The RTC constituted a Panel of Commissioners that recommended P600 per square meter as the minimum valuation. By Order dated February 12, 2008, the court fixed a provisional value of P5,114,300 (P4,546,800 for land and P567,500 for improvements). Spouses Buot encashed the corresponding check, and a writ of possession was issued.
• Substitution of Plaintiff: During the proceedings, NGCP took over the operations of Transco and was substituted as plaintiff by RTC Order dated June 29, 2011.
• RTC Decision: In its September 21, 2011 Decision, the RTC granted the expropriation and fixed just compensation at P1,000 per square meter for an aggregate affected area of 7,578 square meters, plus P567,500 for improvements, ordering NGCP to pay the balance of P3,031,200 and directing the issuance of new certificates of title and tax declarations.

• Exclusion of Power Lines from Section 112: Spouses Buot maintained that power and transmission lines are excluded from the enumeration in Section 112 of the Public Land Act, invoking the principle of expressio unius est exclusio alterius. They argued that the provision should be read together with Sections 113 and 114, which pertain exclusively to water power rights and privileges.
• Strict Construction of Easement: They contended that Section 112, as a limitation on proprietary rights, must be strictly construed so as not to restrict a right not clearly intended to be withheld. They also pointed to the annotation on their title, which in their view covered only legal easements for highways, railroads, irrigation, telegraph and telephone lines, airport runways, and government structures for airport operation.
• Reliability of RTC’s Valuation: Spouses Buot argued that the RTC did not abuse its discretion in valuing the expropriated property at P1,000 per square meter, asserting that the Judgment on Compromise Agreement for the Lamacan and Candaguit properties in Sibonga—involving properties expropriated by Transco in 1993—constituted a certified recorded sale and a reliable valuation benchmark for the same municipality.

• No Compensation for the Statutory Easement: NGCP argued that it is not liable to pay just compensation for the area traversed by the transmission lines because Section 112 of the Public Land Act grants a 60‑meter legal easement free of charge, save for improvements. It further contended that the CA erred in requiring a determination of dangling areas, as that issue was never raised before the RTC.
• Agricultural Classification and Tax Declaration Value: NGCP insisted that the subject property is agricultural, as shown by its tax declaration and the owners’ admission that it was planted with trees, and that the declared value in the tax declaration should govern.
• Improper Valuation Methods: NGCP assailed the RTC’s reliance on valuations from different cases, arguing that the BIR zonal valuation of P1.50 per square meter and the assessed value of P2.80 per square meter were the more reliable data, which the RTC ignored.

• Coverage of Section 112: Whether power and transmission lines fall under “similar works” in Section 112 of the Public Land Act, thereby subjecting the subject property to a legal easement of right‑of‑way not exceeding 60 meters that may be enforced without payment for the land, only damages for improvements.
• Remand and Valuation: Whether the CA correctly set aside the RTC’s valuation of just compensation and remanded the case for determination of the compensable area (including dangling areas) and the value of improvements, or whether the RTC’s award for the entire affected area should be reinstated.

• Coverage of Section 112: Power and transmission lines are “similar works” within the meaning of Section 112. The phrase “and similar works as the Government or any public or quasi‑public service or enterprise” is a general clause that, under the principle of ejusdem generis, is limited to works of the same kind or class as those specifically enumerated—namely, government infrastructure projects intended for public use. The installation of transmission lines is a national government infrastructure project; the IRR of RA 8974 explicitly lists power generation, transmission, and distribution among covered projects. Because the property was originally granted by free patent with express statutory reservations, it is burdened with a legal easement of right‑of‑way not exceeding 60 meters in width. The corridor actually utilized—30 meters wide, covering 7,382 square meters—falls entirely within the 60‑meter limit, so NGCP may occupy it without payment for the land itself, subject only to damages for affected improvements. The narrow annotation on the title does not negate the full statutory encumbrance.
• Remand and Valuation: The remand was proper but overbroad; it was modified to cover only consequential damages and improvement damages. Pursuant to Republic v. Andaya and Bartolata v. Republic, a property owner is entitled to consequential damages for any area outside the 60‑meter easement that is rendered unusable or uninhabitable (dangling areas). Because the utilized 30‑meter width is within the statutory 60 meters, Spouses Buot are not entitled to just compensation for that land itself, but they may recover consequential damages for dangling areas not covered by the unutilized balance of the easement. As to just compensation for the expropriated 196‑square‑meter lot, the RTC’s valuation of P1,000 per square meter was upheld. The trial court considered multiple factors under Section 5 of RA 8974—the owners’ declared value, comparable sales of similarly expropriated properties, the Commissioners’ Report, the classification and best use of the land—and did not act arbitrarily. NGCP’s reliance on zonal and assessed values alone is misplaced because zonal valuation is only one index and cannot alone determine just compensation, which measures the owner’s loss, not the taker’s gain. Hence, the remand was limited to: (1) determining the actual 60‑meter easement area, both utilized and unutilized; (2) identifying dangling areas outside that 60‑meter corridor for consequential damages; and (3) fixing the value of improvements on the 7,382‑square‑meter utilized easement.

• Ejusdem Generis in Statutory Easements — Where a statute lists specific classes of infrastructure works and then uses a general residuary clause such as “and similar works as the Government or any public or quasi‑public service or enterprise,” the general clause is restricted to persons or things of the same kind, class, or nature as those specifically enumerated. Power and transmission lines, being national government infrastructure projects for public use, fall within the ambit of Section 112 of the Public Land Act.
• Legal Easement under Section 112 of CA No. 141 — Lands originally granted by free patent are burdened with a statutory easement of right‑of‑way not exceeding 60 meters in width for public highways, railroads, irrigation ditches, aqueducts, telegraph and telephone lines, airport runways and related structures, and similar works. The government or its franchisee may appropriate this corridor without paying for the land, with damages only for affected improvements. The easement is perpetual during the existence of the project but the underlying ownership remains with the title holder.
• Consequential Damages for Dangling Areas (Andaya Doctrine) — Under Republic v. Andaya and Bartolata v. Republic, a property owner is entitled to just compensation (consequential damages) for any portion of the land outside the 60‑meter statutory easement that, by reason of the enforcement of the easement (e.g., presence of high‑tension transmission lines), suffers practical destruction or material impairment of its value, or is rendered unusable or uninhabitable. Two elements must concur: (1) the remainder is not subject to the statutory lien of right‑of‑way; and (2) the enforcement of the right‑of‑way results in the practical destruction or material impairment of the value of the remaining property, or deprives the owner of its normal use. The unutilized width of the 60‑meter easement remains covered by Section 112 and is not separately compensable as land.
• Judicial Determination of Just Compensation under RA 8974 — The standards enumerated in Section 5 of RA 8974 (classification and use, developmental costs, declared value, selling price of similar lands, disturbance compensation, size, shape, location, tax declaration, zonal valuation, and other relevant facts) are non‑exclusive, permissive, and discretionary. Courts are not rigidly bound to apply each standard mechanically; the determination remains a judicial function. Zonal valuation alone does not equate to just compensation, which must represent the full and fair equivalent of the property as measured by the owner’s loss, not the taker’s gain.

• “Thus, when broad expressions are used, such as, ‘and all others,’ or ‘any others’ these are usually to be restricted to persons or things of the same kind or class with those specifically named in the preceding words.” — stating the ejusdem generis rule.
• “x x x ‘Taking,’ in the exercise of the power of eminent domain, occurs not only when the government actually deprives or dispossesses the property owner of his property or of its ordinary use, but also when there is a practical destruction or material impairment of the value of his property.” — quoted from Andaya as the rationale for consequential damages.
• “Zonal valuation is simply one of the indices of the fair market value of real estate. By itself, this index cannot be used as the sole basis to ascertain just compensation in expropriation cases because the standard is not the taker's gain, but the owner's loss.”
• “[T]he courts are not limited to a certain numerical threshold relative to the BIR zonal valuation of an expropriated property in the determination of just compensation.”

• Republic v. Andaya, 552 Phil. 40 (2007) — Controlling precedent establishing that consequential damages are due for the remaining area of a property when the enforcement of the statutory easement under Section 112 of CA No. 141 renders that area unusable or uninhabitable.
• Bartolata v. Rep. of the Phils., 810 Phil. 978 (2017) — Followed to reiterate the two‑element test for entitlement to just compensation for the remaining property: (1) the remainder is not subject to the statutory lien; and (2) enforcement of the right‑of‑way results in practical destruction or material impairment of its value or deprivation of normal use.
• De Leon v. De Leon-Reyes, 785 Phil. 832 (2016) — Cited to explain that a free patent is a governmental grant of public land that carries all statutory encumbrances and conditions laid out in the Public Land Act.
• National Power Corp. v. Angas, 284‑A Phil. 39 (1992) — Applied for the definition and operation of the ejusdem generis principle.
• Republic v. Cebuan, 810 Phil. 767 (2017) — Relied upon for the rule that the valuation standards in Section 5 of RA 8974 are non‑exclusive, permissive, and discretionary, and that courts are not mechanically bound by them.
• Leca Realty Corp. v. Rep. of the Phils., 534 Phil. 693 (2006) — Emphasized that zonal valuation is merely an index and cannot be the sole basis for just compensation.

• Section 112, Commonwealth Act No. 141 (The Public Land Act), as amended by PD 635 and PD 1361 — Establishes a legal easement of right‑of‑way not exceeding 60 meters in width on lands granted by patent for public highways, railroads, irrigation ditches, aqueducts, telegraph and telephone lines, airport runways and related structures, and similar works, with damages for improvements only. Applied to hold that NGCP’s transmission line corridor is covered without payment for the land.
• Section 5, Republic Act No. 8974 — Enumerates non‑exclusive standards for assessing the value of land in national government infrastructure expropriations. Used to evaluate the RTC’s determination of just compensation; the Court held that the trial court properly weighed multiple factors and was not constrained by zonal or assessed values alone.
• Section 6, Republic Act No. 11361 (Anti‑Obstruction of Power Lines Act) — Prohibits planting, construction, and hazardous activities within the power line corridor; cited to demonstrate the restrictions that render dangling areas unusable and thus support an award of consequential damages.
• Section 44, CA No. 141, as amended by RA 6940 — Governs the grant of free patents for agricultural public lands; referred to in explaining the origin of the statutory encumbrances on the title.

Hernando (Acting Chairperson), Gaerlan, and Dimaampao, JJ., concurred. Perlas‑Bernabe, S.A.J., was on official leave.