GR 172551; (January, 2014) (Digest)
G.R. No. 172551 January 15, 2014
Land Bank of the Philippines vs. Yatco Agricultural Enterprises
FACTS
Respondent Yatco Agricultural Enterprises owned a 27.5730-hectare agricultural land in Calamba, Laguna, placed under CARP coverage in 1999. The Land Bank of the Philippines (LBP) valued the property at ₱1,126,132.89. Dissatisfied, Yatco elevated the matter to the Provincial Agrarian Reform Adjudicator (PARAD), which fixed just compensation at ₱16,543,800.00 using the property’s market value per tax declaration and applying the formula “MV x 2,” rejecting LBP’s valuation for lack of supporting evidence. LBP did not seek reconsideration but instead filed a petition for judicial determination before the Regional Trial Court acting as a Special Agrarian Court (RTC-SAC).
The RTC-SAC fixed just compensation at ₱200.00 per square meter, adopting the valuation from two related civil cases (Civil Case Nos. 2259-95-C and 2326-96-C) decided by other branches of the RTC of Calamba City, which involved expropriation by the National Power Corporation (NAPOCOR) for industrial purposes. The RTC-SAC found LBP’s evidence insufficient for non-compliance with Section 17 of RA 6657 and DAR guidelines. The Court of Appeals affirmed the RTC-SAC decision, noting the properties in the civil cases were the same and the valuation was based on a commissioner’s report after proper inspection.
ISSUE
Whether the RTC-SAC properly determined just compensation by adopting the valuation from unrelated civil cases for industrial expropriation, disregarding the specific factors under Section 17 of RA 6657 for agrarian reform.
RULING
The Supreme Court ruled that the RTC-SAC’s determination was improper and remanded the case for recalculation. The Court emphasized that just compensation must be based on the specific factors enumerated in Section 17 of RA 6657, particularly for agricultural lands taken under agrarian reform, not on valuations from expropriation cases for a different public purpose. The factors include the land’s cost, current market value, nature, actual use, income, sworn valuation, tax declarations, and government assessment. The RTC-SAC erred in simply adopting the ₱200/sq.m. valuation from the NAPOCOR cases, as the purpose (industrial use) and legal framework differ fundamentally from agrarian reform. The determination of just compensation is a judicial function, but it must be exercised within the confines of the governing law. The Court clarified that while tax declarations can be considered, they are not conclusive, and all Section 17 factors must be taken into account. The case was remanded to the RTC-SAC to receive evidence and compute just compensation strictly in accordance with Section 17 of RA 6657 and applicable DAR administrative orders.