G.R. No. 126332 November 16, 1999
LAND BANK OF THE PHILIPPINES, petitioner, vs. COURT OF APPEALS and MARCIA E. RAMOS, respondents.

FACTS

Private respondent Marcia Ramos voluntarily offered her two parcels of riceland for sale under the Comprehensive Agrarian Reform Program (CARP), intending to retain a portion for her family. The Department of Agrarian Reform (DAR) classified the lands as idle and abandoned, acquiring them under its Voluntary Offer to Sell and Compulsary Acquisition schemes. The Land Bank of the Philippines (LBP) initially valued the property at P9,944.48 per hectare, which Ramos rejected as insufficient just compensation. The DAR Adjudication Board (DARAB) subsequently ordered a revaluation, finding that portions of the land were cultivated, not idle. However, before this revaluation was completed, the DAR Regional Director ordered the transfer of the land titles to the Republic. This premature action prompted Ramos to file a complaint for just compensation directly with the Regional Trial Court (RTC) sitting as a Special Agrarian Court (SAC).
The LBP and DAR officials moved to dismiss the complaint, arguing that Ramos failed to exhaust administrative remedies by not awaiting the DARAB’s final revaluation order and that agrarian reform was not an eminent domain proceeding requiring judicial determination of just compensation. The SAC denied the motion to dismiss and, after trial, fixed just compensation. The Court of Appeals modified the SAC’s valuation. The LBP elevated the case to the Supreme Court, contending that the SAC improperly assumed jurisdiction.

ISSUE

Whether the Special Agrarian Court properly acquired jurisdiction over the landowner’s complaint for just compensation despite the pending revaluation process before the DARAB.

RULING

Yes, the SAC properly acquired jurisdiction. The Supreme Court held that the doctrine of exhaustion of administrative remedies was not applicable under the circumstances. While the DARAB has primary jurisdiction for the preliminary determination of just compensation, its proceedings are not a prerequisite for judicial recourse when there is a clear deprivation of property without payment. The DAR’s act of ordering the transfer of ownership to the Republic upon its initial valuation, despite the pending revaluation process that had already found a factual basis for a higher valuation, constituted a taking without complete due process. This premature transfer rendered the administrative remedy inadequate and effectively illusory, justifying Ramos’s direct resort to the SAC.
The Court further clarified that the determination of just compensation for lands taken under CARP is a judicial function. The SAC’s original and exclusive jurisdiction under Section 57 of RA 6657 is precisely designed for this purpose. The administrative valuation by the DAR and LBP is only preliminary. Once a landowner rejects this valuation and the matter of just compensation is brought before the SAC, the court is not bound by the administrative figures. It must independently ascertain just compensation based on the evidence and the factors enumerated in Section 17 of RA 6657, which include the land’s nature, actual use, income, and market value. Therefore, the SAC correctly took cognizance of the case to prevent a protracted deprivation of the landowner’s right to receive fair payment for her property.