Republic of the
Supreme Court
SECOND DIVISION
|
LAND BANK OF THE Petitioner, - versus - HEIRS OF and JACOBA DELGADO, Respondents. |
G.R. No. 167735
Present: CARPIO, J.,
Chairperson, BRION,
PEREZ,
SERENO,
and REYES,
JJ. Promulgated: April 18, 2012 |
x------------------------------------------------------------------------------------x
D E C I S I O N
BRION, J.:
We resolve
the petition for review on certiorari,[1]
filed by the Land Bank of the
The Factual Antecedents
The late
Spouses Salvador and Jacoba Delgado Encinas were the registered owners of a
56.2733-hectare agricultural land in Tinago, Juban, Sorsogon, under Original
Certificate of Title (OCT) No. P-058.
When Republic Act No. (RA) 6657[4]
took effect,[5]
the heirs of the spouses Encinas, Melchor and Simon (respondents), voluntarily offered to sell the land to the
government through the Department of Agrarian Reform (DAR).
On P819,778.30
(or P22,718.14 per hectare) for the
acquired area of 35.9887 hectares (subject
land).[8]
Upon the
DAR's application, accompanied by the petitioners certification of deposit of
payment,[9]
the Register of Deeds of Sorsogon partially cancelled OCT No. P-058 corresponding
to the 35.9887-hectare covered area, and issued Transfer Certificate of Title
Nos. 49948 and 49949 in the name of the Republic of the Philippines on December
5, 1997.[10]
Meanwhile,
since the respondents rejected the petitioners valuation of P819,778.30, the DAR Adjudication Board (DARAB) undertook a summary
administrative proceeding for the determination of just compensation.[11]
On P3,590,714.00, adopting the DARABs
valuation on the property of Virginia Balane in Rangas, Juban, Sorsogon that
fixed the just compensation at P99,773.39
per hectare.[12]
Following
the denial of its motion for reconsideration,[13] the
petitioner filed on
At the
trial, the petitioners witnesses[15]
testified on the condition of the subject land when the DAR conducted the field
investigation in 1992,[16]
and that the petitioner based its P819,778.30
valuation on DAR AO No. 11, series of 1994. The petitioner offered as
documentary evidence the DAR field investigation report,[17] the
claims and processing form, a copy of DAR AO No. 11, series of 1994, and the
field investigation report on Balanes property.[18]
On the
other hand, the respondents witnesses[19]
testified on the current number of trees in the subject land and the estimated
board feet each tree could produce as lumber,[20] the
cost of each fruit-bearing tree,[21]
and the previous offer to sell the land.[22] The
respondents offered as documentary evidence the recent private field
investigation report of their witness, Wilfredo Embile, and the Commissioners
Report of Provincial Assessor Florencio Dino in Civil Case No. 6331 (Vivencio
Mateo, et al. v. DAR, et al.) on the just compensation involving another
property.
The RTC Ruling
In its
April 23, 2003 decision,[23]
the RTC fixed the just compensation at P4,470,554.00,
based on: (1) comparable transactions in the nearby locality; (2) the DARABs
valuation on Balanes property; (3) the updated schedule of fair market value
of real properties in the Province of Sorsogon (Sanggunian Panlalawigan Resolution No. 73-99); (4) the value and
the produce of coconuts, fruits, narra, and other trees, and the number of
board feet extractable from said trees; and (5) the lands current condition
and potential productivity, thus:
Taking into consideration x x x the
comparable sale transactions of similar nearby places as admissible in evidence
(MRR vs. Velasco case), the decision of the DARAB on VOS of Virginia Balane
located at Rangas, Juban, Sorsogon whereby the Board fixed the valuation at
P99,773.39 per hectare, the number of nuts produced from the 1500 coconut trees
found by the representative of the Petitioner Land Bank as per Field
Investigation Report (Exh. B) so that after ten years since its inspection on
August 21, 1992 all coconut trees are fruit bearing now and granting that each
tree can produce nuts per 45 days, then 45 nuts can be produced per tree per
year, 1500 trees can produce 67,500 nuts in eight harvest per year and when
converted to copra can produce 16,750 kilos, 540,000 nuts per year for the 1500
coconut trees on the 35,9887 hectares equals 108,000 kilos at P8.00 per kilo,
the land can get P864,000.00 yearly and one/half of that shall go to landowner
which is P432,000.00, the Court also considers the value of the fruit bearing
trees consisting of 6 guava trees for a total value of P34,000.00, 3 avocado
trees for a total value of P6,000.00, 10 langka trees for a total value of
P4,000.0 and 300 banana hills for the total value of P78,000.00, and or a grand
total of P194,880.00 and the timber producing trees consisting of 100 narra
trees with an extractable lumber of no less 5,000 bd. ft at P55.00 per bd. ft
or a total value of P275,000.00 and other trees with a total bd. ft. of 2,700
bd. ft at P27.00 per bd. ft or a total value of P172,900.00. The Field Investigation
Report (Exh. B) state also that in the portion for acquisition, there is a
hectare of Nipa and according to the Sanggunian Panlalawigan Provincial
Ordinance No. 73-99, Sec. 10-Valuation of Perennial Trees, Plants and Other
Improvements on Agricultural Land, the value of Nipa Improvement in a 5th
class Municipality is P13,400.00 per hectare and summing all of the valuation
on the above improvements, the Court hereby fixes the just compensation for the
area of 35.9887 hectares subject for acquisition in the total value of
P4,470,554.00.[24]
The RTC did
not consider the petitioners P819,778.30
valuation because it was unrealistically low, [25] based on a
field investigation report made 11 years ago, compared to the report of the
respondents representative on the current condition of the property.[26]
With the
denial[27]
of its motion for reconsideration,[28] the
petitioner elevated its case to the CA via a petition for review under Rule 42
of the Rules of Court.[29]
The CA Ruling
In its P819,778.30
valuation for 35.9887 hectares was unconscionably low[31] and
that the RTCs P4,470,554.00 valuation
substantially complied with the factors prescribed by Section 17 of RA 6657.[32]
After the
denial[33]
of its motion for reconsideration,[34] the
petitioner came to this Court.
The Petition
The
petitioner argues that the RTC failed to use the formula provided by Section 17
of RA 6657 in fixing the lands valuation at P4,470,554.00;
the RTC erroneously considered the lands potential, not actual, use, as well
as the lands condition in 2003, many years after the DAR conducted the field
investigation in 1992.
The Case for the Respondents
The
respondents, invoking the RTCs judicial discretion in the determination of
just compensation, submit that the RTCs valuation is reasonable, based on the
guidelines set by Section 17 of RA 6657.
The Issue
The core
issue boils down to whether the CA erred in affirming the RTC decision fixing
the just compensation at P4,470,554.00
for the respondents 35.9887-hectare agricultural land.
Our Ruling
We find merit in the petition.
The taking
of private lands under the agrarian reform program partakes of the nature of an
expropriation proceeding.[35]
In computing the just compensation for expropriation proceedings, the RTC
should take into consideration the value of the land at the time of
the taking, not at the time of the rendition of judgment.[36]
The time of taking is the time when the landowner was deprived of the
use and benefit of his property, such as when title is transferred to the
Republic.[37]
In
determining the just compensation, the RTC is also required to consider the
following factors enumerated in Section 17[38] of RA
6657: (1) the acquisition cost of the land; (2) the current value of the
properties; (3) its nature, actual use, and income; (4) the sworn valuation by
the owner; (5) the tax declarations; (6) the assessment made by government
assessors; (7) the social and economic benefits contributed by the farmers and
the farmworkers, and by the government to the property; and (8) the non-payment
of taxes or loans secured from any government financing institution on the said
land, if any.
Pursuant to
its rule-making power under Section 49 of RA 6657, the DAR translated these
factors into the following basic formula in computing just compensation:[39]
Where:
CNI
= Capitalized Net Income
CS
= Comparable Sales
MV
= Market Value per Tax Declaration
We have
repeatedly stressed[40]
that these factors and formula are mandatory and not mere guides that
the SAC may disregard. While the determination of just compensation is
essentially a judicial function vested in the RTC acting as a [SAC], the judge
cannot abuse his discretion by not taking into full consideration the factors
specifically identified by law and implementing rules. [SACs] are not at
liberty to disregard the formula laid down [by the DAR], because unless an
administrative order is declared invalid, courts have no option but to apply
it. The [SAC] cannot ignore, without violating the agrarian law, the formula
provided by the DAR for the determination of just compensation.[41]
In this
case, we cannot accept the RTCs P4,470,554.00
valuation for the respondents 35.9887-hectare agricultural land as it failed
to comply with the mandated requirements of the law and applicable DAR
regulation on the fixing of just compensation.
Instead of
taking into account the condition of the subject land at the time of taking on December 5,
1997 when the title was transferred to the Republic of the Philippines,[42] the RTC
considered the respondents evidence on the condition of the subject land at
the time of rendition of the judgment, as well the updated schedule of fair
market value of real properties in the Province of Sorsogon (Sanggunian Panlalawigan Resolution No.
73-99). The RTC made use of no computation or formula to arrive at the P4,470,554.00 figure. In fact, it simply
enumerated the respondents evidence and plucked out of thin air the amount of P4,470,554.00.
In the same
vein, we cannot accept the petitioners P819,778.30
valuation since it was based on the condition of the subject land at the time
of the field investigation in 1992, not at the time of the taking of the
subject land in 1997. Besides, the petitioner offered no testimony to show how
the P819,778.30 figure was arrived at;
its witness merely stated that the P819,778.30
valuation was based on DAR AO No. 11, series of 1994.[43]
In the
absence of sufficient evidence for the determination of just compensation, we
are constrained to remand the present case to the SAC for the determination of
just compensation, in accordance with Section 17 of RA 6657 and DAR AO No.
02-09 dated
WHEREFORE, the
petition is GRANTED. The July 22, 2004 decision
and the April 6, 2005 resolution of the Court of Appeals in
CA-G.R. SP No. 78596 are hereby REVERSED and SET ASIDE. The case
is REMANDED to the
No pronouncement
as to costs.
SO ORDERED.
ARTURO D. BRION
Associate Justice
WE CONCUR:
ANTONIO T. CARPIO
Associate
Justice
Chairperson
|
JOSE Associate
Justice |
MARIA Associate
Justice |
BIENVENIDO L. REYES
Associate
Justice
A T T E S T A T I O N
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 Courts 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 Decision had been reached in consultation before the case was
assigned to the writer of the opinion of the Courts Division.
RENATO
C. CORONA
Chief
Justice
[1] Filed under Rule 45 of the 1997 Rules of Civil Procedure; rollo, pp. 20-53.
[2] Penned by Associate Justice Amelita G. Tolentino, with the concurrence
of Associate Justices Roberto A. Barrios and Vicente S.E. Veloso;
[3]
[4] The Comprehensive Agrarian Reform Law of 1988.
[5] Effective
[6] Rollo, pp. 129-131.
[7]
[8] Pursuant to Executive Order
No. 405 (dated
[9] Rollo, p. 128.
[10]
[11] In accordance with Section 16(d) of RA 6657.
[12] Rollo, pp. 149-151.
[13]
[14] Docketed as Civil Case No. 2001-6911, entitled Land Bank of the Philippines, represented by Alex A. Lorayes, Head, Agrarian Operations Center v. Heirs of Salvador Encinas and Jacoba Delgado, namely Melchor Encinas and Simon Encinas, Secretary of Department of Agrarian Reform and Atty. Manuel M. Capellan, in his capacity as Provincial Adjudicator of Sorsogon; id. at 144-148.
[15] Ferdinand Abraham (Agrarian Affairs Specialist), Sheila Higola (Agrarian Affairs Specialist), Rogelio Erebe, Eduardo Batalesco, Jose Grefalda (Tinago Barangay Captain), Renato Gacias, Augusto Dellosa and DARAB Adjudicator Capellan.
[16] That (a) the land is situated in a coastal area; (b) the terrain is mostly hilly and mountainous; (c) the land can be reached by motorized boat or a three (3) kilometer hike; (d) the land has no infrastructure and electricity, and the water is supplied by a deep well; (e) there are 1,400 20-year old coconut trees, 400 7-year old non-fruit bearing trees, 1,000 nipa palms, 20 santol trees, and 2 narra trees; and (f) the lands average annual production is 608.89 kgs. of coconut per hectare and 2,400 nipa shingles; Rollo, pp. 109-110.
[17]
[18]
[19] Romeo Guab (former Mayor of Juban, Sorsogon), Wilfredo Embile, and Rogelio Encinas.
[20] That
(a) 100 narra trees can produce 5,000 board feet at P55.00 per board foot; (b) 13 dita trees can produce 500 board
feet; (c) six antipolo trees can produce 300 board feet; (d) three alaw-haw trees can produce 200 board feet; (e) four mara-mara
trees can produce 100 board feet; (f) eight anonang trees can produce 100 board
feet; (g) two hagbuyo trees can produce 100 board feet; (h) five tarihan trees
can produce 200 board feet; (i) two talisay trees can produce 100 board feet;
(j) four tabgon trees can 200 board feet; (k) three amidling trees can produce
100 board feet, all (except narra trees) at P27.00
per board feet; Rollo, p. 110.
[21] There
are six guava trees at P430.00 each, 37 santol trees at P1,900.00 each, two mango trees at P17,000.00 each, three avocado trees at P2,000.00 each, 20 langka trees at P400.00 each, 300 banana hills at P260.00 per hill, and 100 coconut trees
per hectare; ibid.
[22] From
P150,000.00, lowered to P120,000.00, per hectare in 1970 and 1975;
ibid.
[23]
[24]
[25]
[26]
[27]
[28]
[29]
[30] Supra note 2 at 14.
[31] Supra note 2 at 11.
[32] Supra note 2 at 13.
[33]
[34] Rollo, pp. 66-82.
[35] Land Bank of the Philippines v. Department of Agrarian Reform, G.R. No. 171840, April 4, 2011, 647 SCRA 152, 169; and Land Bank of the Philippines v. Imperial, G.R. No. 157753, February 12, 2007, 515 SCRA 449, 458.
[36] Gabatin v. Land Bank of the
[37] Land Bank of the Philippines v. Livioco, G.R. No. 170685, September 22, 2010, 631 SCRA 86, 112-113; see Eusebio v. Luis, G.R. No. 162474, October 13, 2009, 603 SCRA 576, 586-587.
[38] 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, 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 non-payment of taxes or loans secured from any
government financing institution on the said land shall be considered as
additional factors to determine its valuation.
[39] DAR AO No. 06-92 dated October 30, 1992, as amended by DAR AO No. 11-94 dated September 13, 1994; see also DAR AO No. 05-98 dated April 15, 1998 and DAR AO No. 02-09 dated October 15, 2009.
[40] Land Bank of the Philippines v. Sps. Banal, 478 Phil. 701, 715 (2004); Landbank of the Philippines v. Celada, 515 Phil. 467 (2006); Lubrica v. Land Bank of the Philippines, G.R. No. 170220, November 20, 2006, 507 SCRA 415; Land Bank of the Philippines v. Lim, G.R. No. 171941, August 2, 2007, 529 SCRA 129; Land Bank of the Philippines v. Suntay, G.R. No. 157903, October 11, 2007, 535 SCRA 605; Sps. Lee v. Land Bank of the Philippines, G.R. No. 170422, March 7, 2008, 548 SCRA 52; Land Bank of the Philippines v. Heirs of Eleuterio Cruz, G.R. No. 175175, September 29, 2008, 567 SCRA 31; Land Bank of the Philippines v. Dumlao, G.R. No. 167809, November 27, 2008, 572 SCRA 108; Land Bank of the Philippines v. Gallego, Jr., G.R. No. 173226, January 20, 2009, 576 SCRA 680; Allied Banking Corporation v. Land Bank of the Philippines, G.R. No. 175422, March 13, 2009, 581 SCRA 301; Land Bank of the Philippines v. Heirs of Honorato de Leon, G.R. No. 164025, May 8, 2009, 587 SCRA 454; Land Bank of the Philippines v. Kumassie Plantation Company, Incorporated, G.R. Nos. 177404 and 178097, June 25, 2009, 591 SCRA 1; Land Bank of the Philippines v. Rufino, G.R. Nos. 175644 and 175702, October 2, 2009, 602 SCRA 399; Land Bank of the Philippines v. Luciano, G.R. No. 165428, November 25, 2009, 605 SCRA 426; Land Bank of the Philippines v. Dizon, G.R. No. 160394, November 27, 2009, 606 SCRA 66; Heirs of Lorenzo and Carmen Vidad v. Land Bank of the Philippines, G.R. No. 166461, April 30, 2010, 619 SCRA 609; Land Bank of the Philippines v. Soriano, G.R. Nos. 180772 and 180776, May 6, 2010, 620 SCRA 347; Land Bank of the Philippines v. Barrido, G.R. No. 183688, August 18, 2010, 628 SCRA 454; Land Bank of the Philippines v. Colarina, G.R. No. 176410, September 1, 2010, 629 SCRA 614; Land Bank of the Philippines v. Livioco, supra note 37; Land Bank of the Philippines v. Escandor, G.R. No. 171685, October 11, 2010, 632 SCRA 504; Land Bank of the Philippines v. Rivera, G.R. No. 182431, November 17, 2010, 635 SCRA 285; Land Bank of the Philippines v. Department of Agrarian Reform, and supra note 35.
[41] Land Bank of the
[42] Supra note 10.
[43] Agrarian Affairs Specialist Sheila Higola; rollo, p. 110.