Republic
of the
Supreme
Court
SECOND DIVISION
|
LAND BANK OF THE
Petitioner, - versus - RIZALINA GUSTILO BARRIDO
and HEIRS OF ROMEO BARRIDO, Respondents. |
G.R.
No. 183688
Present: CARPIO, J., Chairperson NACHURA, PERALTA, ABAD, and MENDOZA, JJ. Promulgated: August
18, 2010 |
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RESOLUTION
NACHURA, J.:
For review is the Court
of Appeals (CA) Decision[1]
dated February 20, 2008 and its Resolution[2]
dated July 8, 2008 in CA-G.R. CEB-SP No. 01641. The assailed decision affirmed
the Decision[3] of
the Regional Trial Court (RTC), Branch 34,
The undisputed facts are as follows:
Respondents Rizalina Gustilo Barrido and the Heirs of Romeo
Barrido are the registered owners of a parcel of land with an area of 89,204
square meters covered by Original Certificate of Title No. 0-6318, situated in
Barangay Apologista, Sara, P60,385.49 as
just compensation, but respondents rejected the offer. Respondents instituted
an original action before the RTC for the judicial determination of just
compensation. The case was docketed as Civil Case No. 04-28093.[5]
In their separate Answers, petitioner and the Department of
Agrarian Reform (DAR) insisted that the valuation made is correct, it being
based on the formula laid down in Presidential Decree (P.D.) No. 27 as
supplemented by Executive Order (E.O.) No. 228.[6]
Under these issuances, the prescribed formula is as follows:
Land Value = Average Gross
Production (AGP) x 2.5 x Government Support Price (GSP)
On December 8, 2005, the RTC rendered a Decision[7]
fixing the just compensation at P94, 797.09 per hectare, the dispositive
portion of which reads:
WHEREFORE,
based on the foregoing premises, judgment is hereby rendered fixing the just
compensation of land at P94,797.09
per hectare and ordering the LBP to pay plaintiffs Rizalina Gustilo Barrido and
Heirs of Romeo Barrido the total sum of P411,997.63 as just compensation for the 4.3461 hectares taken by
the government pursuant to P.D. No. 27 and E.O. No. 228 plus 12% interest per
annum from March 21, 2003 until full payment.
SO
ORDERED.[8]
The RTC arrived at the valuation by taking the average
between the amount found by the DAR using the formula prescribed by E.O. No.
228 and the market value of the property which is P175,700.00 per
hectare. In addition, the court also awarded 12% interest in the form of
damages in view of the delay in the payment of just compensation.[9]
Petitioner’s motion for reconsideration was denied on March 1, 2006.[10]
On appeal, the CA
affirmed the RTC decision in its entirety. Hence, the instant petition for
review which assigns the following errors:
I.
THE HONORABLE COURT OF APPEALS COMMITTED SERIOUS ERRORS OF LAW WHEN IT AFFIRMED THE DECISION DATED DECEMBER 8, 2005 AND ORDER DATED MARCH 1, 2006 OF THE REGIONAL TRIAL COURT OF ILOILO CITY, BRANCH 34 IN CIVIL CASE NO. 04-28093, FINDING THAT THE APPLICABLE LAW IN THE INSTANT CASE IS R.A. NO. 6657 AND NOT P.D. NO. 27 AND E.O. NO. 228.
II.
ASSUMING ARGUENDO THAT R.A. NO. 6657 IS THE APPLICABLE LAW, STILL THE HONORABLE COURT OF APPEALS COMMITTED SERIOUS ERRORS OF LAW WHEN IT AFFIRMED THE SAID DECISION AND ORDER OF THE TRIAL COURT THAT FIXED THE JUST COMPENSATION WHICH IS NOT IN ACCORDANCE WITH THE PROVISIONS OF R.A. NO. 6657 AS TRANSLATED INTO A BASIC FORMULA UNDER DAR ADMINISTRATIVE ORDER NO. 5, SERIES OF 1998.
III.
THE HONORABLE COURT OF APPEALS COMMITTED SERIOUS ERRORS OF LAW WHEN IT AFFIRMED THE SUBJECT DECISION AND ORDER OF THE TRIAL COURT THAT AWARDED IN FAVOR OF THE RESPONDENT TWELVE PERCENT (12%) INTEREST PER ANNUM FOR ALLEGED DELAY IN PAYMENT.[11]
The issues raised in the
instant case are not novel. We have ruled in a number of cases that if just
compensation is not settled prior to the passage of Republic Act (R.A.) No.
6657, it should be computed in accordance with said law even if the property
was acquired under P.D. No. 27.[12]
The fixing of just compensation should, therefore, be based on the parameters prescribed
in R.A. No. 6657, with P.D. No. 27 and E.O. No. 228 having only suppletory
effect.[13]
Specifically, Section 17[14]
of R.A. 6657 is the principal basis of the computation for just compensation.[15]
The factors set forth in this section have been translated into a basic formula
outlined in DAR Administrative Order No. 5, series of 1998,[16]
thus: [17]
A.
There shall be one basic
formula for the valuation of lands covered by VOS or CA:
LV = (CNI x 0.6) + (CS x 0.3) + (MV x 0.1)
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 the 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.
While
the determination of just compensation is essentially a judicial function vested
in the RTC acting as a
In
this case, the RTC adopted a different formula in determining land valuation by
considering the average between the findings of the DAR using the formula laid
down in E.O. 228 and the market value of the property as stated in the tax
declaration. This is obviously a departure from the mandate of the law and the DAR
administrative order.
As
the RTC based its valuation on a different formula and without taking into
consideration the factors set forth in Section 17 of R.A. 6657, we are
constrained to remand the case to the RTC for the determination of just
compensation in accordance with this formula and applicable DAR regulations.
WHEREFORE, the February 20, 2008 Decision and July 8, 2008
Resolution of the Court of Appeals in CA-G.R. CEB-SP No. 01641 are REVERSED and SET ASIDE.
Civil Case No. 04-28093 is REMANDED to the court of origin, Branch 34 of the Regional Trial
Court of Iloilo City, which is directed to determine with dispatch the just
compensation due respondents Rizalina Gustilo Barrido and the Heirs of Romeo
Barrido strictly in accordance with the formula laid down in DAR Administrative
Order No. 5, series of 1998.
SO ORDERED.
ANTONIO
EDUARDO B. NACHURA
Associate
Justice
WE CONCUR:
ANTONIO T. CARPIO
Chairperson
|
DIOSDADO M. PERALTA Associate
Justice |
ROBERTO A. ABAD Associate
Justice |
JOSE CATRAL
Associate
Justice
A T T E S T A T I O N
I attest that the conclusions in the above Resolution had
been reached in consultation before the case was assigned to the writer of the
opinion of the Court’s Division.
ANTONIO
T. CARPIO
Associate
Justice
Chairperson,
Second Division
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution
and the Division Chairperson's Attestation, I certify that the conclusions in
the above Resolution had been reached in consultation before the case was
assigned to the writer of the opinion of the Court’s Division.
RENATO
C. CORONA
Chief
Justice
[1] Penned
by Associate Justice Amy C. Lazaro-Javier, with Associate Justices Pampio A.
Abarintos and Francisco P. Acosta, concurring; rollo, pp. 65-75.
[2] Penned
by Associate Justice Amy C. Lazaro-Javier, with Associate Justices Priscilla
Baltazar-Padilla and Francisco P. Acosta, concurring; id. at 78-79.
[3] Penned
by Presiding Judge Ma. Yolanda M. Panaguiton-Gaviño; id. at 120-133.
[4] Initially
claimed as 45,461 sq m.
[5] Rollo, p. 65.
[6]
[7] Supra
note 3.
[8] Rollo, p. 131.
[9]
[10]
[11]
[12] Land Bank of the
[13] Land Bank of the
[14] Section
17 of R.A. 6657 states:
SEC.
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, the 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 nonpayment of taxes or loans secured from any
government financing institution on the said land shall be considered as
additional factors to determine its valuation.
[15] Land Bank of the
[16] Revised
Rules and Regulations Governing the Valuation of Lands Voluntarily Offered or
Compulsorily Acquired Pursuant to Republic Act No. 6657.
[17] Heirs of Lorenzo and Carmen Vidad and Agvid
Construction Co., Inc. v. Land Bank of the Philippines, G.R. No. 166461,
April 30, 2010.
[18] Land Bank of the
[19] Land Bank of the
[20] Allied Bank Corporation v. Land Bank of the