G.R. No.

L-59791 February 13, 1992

MANILA ELECTRIC COMPANY, petitioner,
vs.
THE HONORABLE GREGORIO G. PINEDA, Presiding Judge, Court of First Instance of Rizal, Branch XXI,
Pasig, Metro Manila, TEOFILO ARAYON, SR., GIL DE GUZMAN, LUCITO SANTIAGO and TERESA
BAUTISTA, respondents.
Facts:
A complaint for eminent domain was filed by the petitioner MERALCO against forty two (42)
defendants. The said complaint alleges that for the purpose of constructing a 230 KV Transmission line
from Barrio Malaya to Tower No. 220 at Pililla, Rizal, petitioner needs portions of the land of the private
respondents consisting of an aggregate area of 237, 321 square meters. Despite the petitioners offer to
pay compensation and attempt for negotiation with the respondents, the parties failed to reach an
agreement. On December 27, 1974 private respondents question in their motion the petitioners legal
existence and the area sought to be appropriated which they find too excessive. Despite the opposition
of the private respondents the court issued an order dated January 13, 1975 authorizing the petitioner
to take or enter upon the possession of the property sought to be expropriated. On July 13, 1976,
private respondents filed a motion for withdrawal of deposit claiming that they are entitled to be paid at
forty pesos (40.00) per square meter or an approximate sum of P 272,000.00 ad prayed that they be
allowed to withdraw the sum of P71,771.50 from petitioners deposit account. However, the
respondents motion was denied in an order dated September 3, 1976.
The petitioners sold to the NAPOCOR the power plants and transmission lines, including the
transmission lines traversing private respondents property on October 30, 1979. Respondent court
issued an order appointing the members of the Board of Commissioners to make an appraisal of the
properties. But the petitioner filed a motion to dismiss the complaint on the ground that it has lost all
its interests over the transmission lines because of their sale to the Napocor. Another motion for
payment was filed by the respondents on June 9, 1981 where the court granted the motion for
payment. The plaintiff to pay the movants the amount of P20,400.00 for the expropriated area of 6,800
sq m. at P3.00 per sq. m. An omnibus motion filed by the private respondents on December 15, 1981
praying that they be allowed to withdraw an additional sum of P 90, 125.50 which the court granted
leaving a balance of P161,475.00 still payable to the respondents.
In response to the motion made by the respondents, the petitioner filed an opposition alleging the
private respondents are not entitled to payment of just compensation because there is still no appraisal
and valuation of the property. The court denied the petitioners motion for reconsideration and motion
for contempt filed against the respondents.
The respondent court stressed in said order that at this stage, the Court starts to appoint
commissioners to determine just compensation or dispenses with them and adopts the testimony of a
credible real estate broker, or the judge himself would exercise his right to formulate an opinion of his
own as the value of the and in question.
The petitioner strongly maintains that the respondents courts act of determining and ordering the
payment of just compensation to private respondents would formal presentation of evidence by the
parties on the reasonable value of the property constitutes a flagrant violation of petitioners
constitutional right to due process. A petition for certiorari was filed by the petitioner.

Issue:
Whether or not the respondent court can dispense with the assistance of a Board of Commissioners in
an expropriation proceeding and determine for itself the just compensation.
Held:
The court ruled that the Sections 5 and 8 of the Revised Rules of Court is applicable in the case at bar.
The respondent judge arrived at the amount of just compensation on its own, without the proper
reception of evidence before the Board of Commissioners.
Private respondents as landowners have not proved by competent evidence the value of their
respective properties at a proper hearing. Likewise, the petitioner has not been given the opportunity
to rebut any evidence that would have been presented by private respondents.
In an expropriation case the determination of just compensation, a trial before the Commissioners is
indispensable to allow the parties to present evidence on the issue of just compensation.
The appointment of at least three (3) competent persons as commissioners to ascertain just
compensation for the property sought to be taken is a mandatory requirement in expropriation cases.
The trial with the aid of the commissioners is a substantial right that may not be done away with
capriciously or for no reason at all. In such instances, where the report of the commissioners may be
disregarded, the trial court may make its own estimate of value from competent evidence that may be
gathered from the record. The aforesaid joint venture agreement relied upon by the respondent judge,
in the absence of any other proof of valuation of said properties, is incompetent to determine just
compensation. Petition is GRANTED.