SPS.
HUANG,
Petitioners, Present:
QUISUMBING,
J.,
Chairperson,
- versus
- CARPIO MORALES,
TINGA, and
VELASCO,
JR., JJ.
LAND
BANK OF THE
Respondent.
Promulgated:
x---------------------------------------------------------------------------x
Tinga,
J.:
For
our consideration is a Petition[1]
assailing the
The
antecedents follow.
On P315,307.87[4] as
compensation for 3.195 hectares of the property. Petitioners rejected the offer.
Subsequently,
a summary administrative proceeding was conducted by the Department of Agrarian
Reform Adjudication Board (DARAB) to determine the valuation and compensation
of the subject property. On
Aggrieved,
petitioners filed an original petition[7]
for the determination of just compensation before the P250.00 per square meter. LBP, for its part, presented the testimony of
one Theresie P. Garcia, an agrarian affairs specialist. The SAC, citing the appraisal report and its
decision in Civil Case No. 7171, decided in favor of petitioners and ordered LBP
to pay them P7,978,750.00 as just compensation.[10]
LBP
filed a Petition for Review[11]
before the Court of Appeals and argued that the SAC erred in giving
considerable weight on the appraisal report of the private appraisal firm
thereby disregarding the provisions of R.A. No. 6657 and its implementing
regulations. The Court of Appeals ruled
that the SAC should have refrained from taking judicial notice of its own
decision in Civil Case No. 7171 in resolving just compensation in the present
case, especially because the values rendered in the previous decision had not yet
attained a final and executory character at
the time.[12] It found that the SAC made a wholesale
adoption of the valuation of the appraisal company and did not consider the
other factors set forth in R.A. No. 6657 even though the appraisal company
admitted that it did not consider as applicable the CARP valuation of the property.[13]
The
Court of Appeals likewise found the value proposed by LBP to be extremely low
considering the disparity between the said amount and that suggested by the
appraisal company. According to the Court of Appeals, the SAC should have
judiciously made an independent finding of fact and explained the legal basis thereof.[14]
The
Court of Appeals held that since the taking of private lands under the agrarian
reform program partakes of the nature of an expropriation proceeding, the SAC
should have appointed competent and disinterested commissioners to assist it in
valuating the property in question, following Section 5, Rule 67 of the 1997
Rules of Civil Procedure.[15] It remanded the case to the trial court
“for proper and judicious determination of just compensation, appointing for
that purpose a set of commissioners.”[16]
Before
us, petitioners allege that it is no longer necessary to remand the case to the
lower court because the parties already had the chance before the SAC to
present evidence on the valuation of the subject landholding. Petitioners
believe that the remand of the case would give LBP undue opportunity which it
already had during the proceedings a quo,
and which opportunity it failed to take advantage of.[17]
Petitioners
also argue that the SAC may validly take judicial notice of its decision in the
other just compensation cases. They point out that they had offered in the
present case both testimonial and documentary evidence adduced in the previous case.
Thus, the SAC’s decision in this case was based on the evidence presented
during trial.[18]
Finally, relying on
the presumption of regularity, petitioners claim that the SAC had considered
the criteria set forth in the law for the determination of just compensation in
computing the value of the subject landholding. In any case, according to them, R.A. No. 6657 does
not at all require the SAC to consider all the seven factors enumerated therein
in its determination of just compensation.[19]
In its Comment,[20]
LBP argues that the Supreme Court is not a trier of facts, and is not
duty-bound to determine the veracity of the factual allegations of petitioners.[21] Anent the issue of judicial notice, LBP
posits that the reliance by the SAC and petitioners on the valuation in Civil
Case No. 7171 is misplaced because the said case is still on appeal and has not
yet attained finality.[22] Even if the evidence in the aforesaid case is
presented in this case, the fact remains that the valuation reached by the SAC
is not in accord with R.A. No. 6657 as translated into a basic formula in DAR
Administrative Order No. 5, series of 1998 (AO No. 5).[23] In
addition, LBP posits that the factors in determining just compensation, as
spelled out in Land Bank of the
Philippines v. Spouses Banal[24]
were not observed by the SAC in the instant case since it relied merely on the
alleged selling price of the adjoining lands in fixing the just compensation of
the subject property instead of following the formula under AO No. 5.[25] LBP adds that the subject property is being
acquired by the government
pursuant to its
land reform program, and
thus its potential for
commercial, industrial or residential uses will not affect the compensation to
be paid by the State as its value is determined at the time of the taking.[26]
There is no merit in the petition.
Judicial cognizance is based on
considerations of expediency and convenience.
It displaces evidence since, being equivalent to proof, it fulfills the
object which the evidence is intended to achieve.[27]
The SAC may take judicial notice of
its own decision in Civil Case No. 7171.
It has been said that courts may take judicial notice of a decision or
the facts involved in another case tried by the same court if the parties
introduce the same in evidence or the court, as a matter of convenience, decides
to do so.[28] Petitioners presented the same appraisal
report offered in Civil Case No. 7171, and there seems to be no objection on
the part of LBP when they did so.
We note, however, that the SAC’s cognizance of
its findings in Civil Case No. 7171 was not the sole reason for its decision. A reading of its decision shows that the SAC
considered the evidence presented by both petitioners and LBP, i.e., the testimonies and report used in
Civil Case No. 7171 proffered by petitioners, and the testimony of LBP’s agrarian affairs specialist. The SAC evidently found the testimony of the
LBP officer unsatisfactory and LBP’s
valuation improper, and thus relied on the evidence presented by petitioners.
As the Court sees it, the decision in
Civil Case No. 7171 merely strengthened the case for petitioners.
Be that as it may, the SAC’s reliance
on the valuation made by the appraisal company is misplaced, since the
valuation was not arrived at using the factors required by the law and
prescribed by the AO No. 5.
Section 17 of R.A. No. 6657 which enumerates
the factors to be considered in determining
just compensation reads:
SECTION 17. Determination of Just Compensation.—In determining just
compensation, the cost of acquisition of
the land, the current value of like
properties, its nature, actual use and income, the sworn valuation by the owner, tax
declarations, and the assessment made by government assessors shall be
considered. The social and economic
benefits contributed by the farmers and the
farmworkers and by the Government to the property as
well as the non-payment of taxes or
loans secured from any government financing institutions on the said land shall
be considered as additional factors to determine its valuation.
These factors have already been incorporated
in a basic formula by the DAR pursuant to its rule-making power under Section
49 of R.A. No. 6657. AO No. 5 precisely filled in the details of Section 17, R. A. No. 6657 by providing a basic formula by which the factors
mentioned therein may be taken into account.[29] This formula has to be considered by the SAC
in tandem with all the factors referred to in Section 17 of the law. The administrative
order provides:
A. There shall be one basic
formula for the valuation of lands covered by VOS or CA:
Where:
CNI = Capitalized Net Income
CS = Comparable Sales
MV = Market Value per Tax Declaration
The above formula shall be used if all three factors are present, relevant, and applicable.
A1. When the CS factor is not present and
CNI and MV are applicable, the formula shall be:
A2. When the CNI factor is not present, and
CS and MV are applicable, the formula shall be:
A3. When both the CS and CNI are not
present and only MV is applicable, the formula shall be:
In no case shall the value of idle land using the formula MV x 2 exceed
the lowest value of land within the same estate under consideration or within
the same barangay or municipality (in that order) approved by LBP within one
(1) year from receipt of claimfolder.
---
Where:
CNI= (AGPxSP) - CO
.12
AGP= Average Gross Production corresponding to the latest available 12 months’ gross production immediately preceding the date of FI (field investigation)
SP= Selling Price (the average of the latest available 12 months selling prices prior to the date of receipt of the CF (claim folder) by LBP for processing, such prices to be secured from the Department of Agriculture (DA) and other appropriate regulatory bodies or, in their absence, from the Bureau of Agricultural Statistics. If possible, SP data shall be gathered for the barangay or municipality where the property is located. In the absence thereof, SP may be secured within the province or region.
CO = Cost of Operations
Whenever the cost of operations could not be obtained or verified, an assumed net income rate (NIR) of 20% shall be used. Landholdings planted to coconut which are productive at the time of FI shall continue to use the assumed NIR of 70 %. DAR and LBP shall continue to conduct joint industry studies to establish the applicable NIR for each crop covered under CARP.
0.12 = Capitalization rate
We find
that the factors required by the law and
enforced by the DAR Administrative Order were not observed by the SAC when it adopted wholeheartedly the
valuation arrived at in the appraisal report. According to the appraisal
company, it “personally inspected the property, investigated local market
conditions, and have given consideration to the extent, character and utility
of the property; sales and holding prices of similar land; and highest and best
use of the property.”[30] The value of the land was arrived at using
the market data approach, which bases the value of the land on sales and
listings of comparable property registered within the vicinity.[31] In fact, as noted by the Court of Appeals, a
representative of the company admitted that
it did not consider the CARP valuation to be applicable.[32]
This is
not to say that the Court favors the valuation given by LBP. While it presented
a land valuation worksheet[33] and a claims valuation and processing form,[34] which both value the land at P315,
307.87, we find that LBP’s valuation is
too low vis-á-vis the
value suggested by the appraisal company. Moreover,
we observe that the
valuation was not
arrived at based on all
the factors provided in the law. As admitted by its agrarian affairs specialist,
she had not gone over the property before she made the valuation, nor was she
aware of adjacent properties/structures.[35] The LBP was not thorough in its valuation of
the subject property.
All
told, we find that the remand of the case is in order to better determine the
proper valuation of the subject property.
We
clarify, however, that we are not in accord with the declaration
of the Court of Appeals on the appointment of commissioners in the instant
case. According to the appellate court:
x
x x Consequently, when the
Regional Trial Court acting as a Special Agrarian Court determines just
compensation, it is mandated to apply the Rules of Court.[36] The rules on expropriation, on the other hand,
specifically under Section 5 of Rule 67 of the 1997 Rules on Civil Procedure provides to wit:
SEC.5. Ascertainment of compensation.— Upon the rendition of the order of expropriation, the court shall appoint not more than three (3) competent and disinterested persons as commissioners to ascertain and report to the court the just compensation for the property sought to be taken. The order of appointment shall designate the time and place of the first session of the hearing to be held by the commissioners and specify the time within which their report is to be filed with the court.
x x x
Under the afore-quoted provision,
it is clear that the SAC should have appointed competent and disinterested
commissioners to assist it in valuating the property in question. (Emphasis
supplied) x x x.[37]
The
Court of Appeals seems to imply that the appointment of commissioners is
mandatory in agrarian reform cases. We
do not agree. While the Rules of Court
provisions apply to proceedings in special agrarian courts,[38] it is clear that unlike in expropriation
proceedings under the Rules of Court the appointment of a commissioner or
commissioners is discretionary on the part of the court or upon the instance of
one of the parties. And when the court
does resort to the commissioners-type of appraisal, it is not circumscribed to
appoint three commissioners, unlike the modality under Rule 67. Section 58 of R.A. No. 6657 provides:
Sec. 58. Appointment of Commissioners.—The Special Agrarian Courts, upon their own initiative or at the instance of any of the parties, may appoint one or more commissioners to examine, investigate and ascertain facts relevant to the dispute, including the valuation of properties, and to file a written report thereof with the court.
With the remand of the case, it is now up to the SAC, or to
the parties, to determine if there is a need to avail of commissioners to
arrive at the proper valuation of the
subject land.
WHEREFORE, the
petition is DENIED. The decision
of the Court of Appeals is AFFIRMED with MODIFICATION as above indicated. The case is REMANDED to the Regional Trial
Court of Balanga,
SO
ORDERED.
DANTE O. TINGA
Associate Justice
WE CONCUR:
LEONARDO A. QUISUMBING
Associate Justice
Chairperson
CONCHITA CARPIO MORALES PRESBITERO J.
VELASCO, JR.
Associate Justice Associate Justice
ATTESTATION
I attest that the conclusions in the above
Decision had been reached in consultation before the case was assigned to the
writer of the opinion of the Court’s Division.
LEONARDO A. QUISUMBING
Associate
Justice
Chairperson,
Second Division
CERTIFICATION
Pursuant to Section 13, Article VIII
of the Constitution, and the Division Chairperson’s Attestation, it is hereby
certified that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Court’s Division.
REYNATO S. PUNO
Chief Justice
[3]The property,
covered by Transfer Certificate of Title (TCT) No. T-26258, is located in Mandama, Hermosa,
[4]The
valuation was made by the Land Bank of the
[12]The
Court of Appeals cited T’boli Agro – Industrial
Dev’t., Inc. v. Solipapsi, 442 Phil. 499 (2002) and
Consolidated Cases of Land Bank of the Phils. v. Wycoco, 464 Phil. 83 (2004).
[13]Rollo, p. 34.
[20]
[38]Sec. 57 of R.A. No. 6657 provides:
SECTION 57. Special Jurisdiction.— The Special Agrarian Courts shall have original and exclusive jurisdiction over all petitions for the determination of just compensation to landowners, and the prosecution of all criminal offenses under this Act. The Rules of Court shall apply to all proceedings before the Special Agrarian Courts, unless modified by this Act.
The Special Agrarian Courts shall decide all appropriate cases under their special jurisdiction within thirty (30) days from submission of the case for decision.