GR 166259; (November, 2012) (Digest)
G.R. No. 166259; November 12, 2012
LAND BANK OF THE PHILIPPINES, Petitioner, vs. HONEYCOMB FARMS CORPORATION, Respondent.
FACTS
Respondent Honeycomb Farms Corporation (HFC) voluntarily offered its 29.0966-hectare agricultural land for Comprehensive Agrarian Reform Program (CARP) coverage. The Land Bank of the Philippines (LBP) valued the compensable area of 27.5871 hectares at P165,739.44. HFC rejected this and filed a petition for summary administrative determination of just compensation with the Department of Agrarian Reform Adjudication Board (DARAB). While the DARAB proceedings were pending, HFC also filed a Complaint for Determination and Payment of Just Compensation directly with the Regional Trial Court (RTC), acting as a Special Agrarian Court (SAC), citing unreasonable delay. The DARAB later issued a Decision affirming LBP’s valuation. The SAC, however, proceeded to fix just compensation at P931,109.20, considering factors like roadside location and proximity to a commercial district. Both parties appealed to the Court of Appeals (CA).
ISSUE
The primary issue is whether the SAC properly acquired jurisdiction over HFC’s complaint for just compensation despite the pendency of the DARAB proceedings. Subsidiary issues involve the propriety of the SAC’s valuation method and its award of consequential damages and attorney’s fees.
RULING
The Supreme Court ruled that the SAC correctly acquired jurisdiction. The Court emphasized that the original and exclusive jurisdiction to determine just compensation for CARP-covered lands lies with the SAC. While administrative proceedings before the DARAB are a prerequisite, this requirement is not absolute. An exception exists when there is unreasonable delay or official inaction in the administrative process. Here, HFC filed its SAC complaint due to the DARAB’s failure to decide its petition within the 30-day period mandated by Section 16 of Republic Act No. 6657. This constituted unreasonable delay, justifying HFC’s direct resort to the SAC. The subsequent DARAB decision did not retroactively validate the administrative process or divest the SAC of its properly acquired jurisdiction.
On valuation, the Court held that the SAC erred. While it has discretion, the SAC must consider the valuation factors enumerated in Section 17 of RA 6657 and the formulas in pertinent DAR administrative orders as starting points. The SAC’s reliance on judicial notice of general land characteristics, without applying the statutory formula or explaining its deviation, was improper. Consequently, the case was remanded to the SAC for proper determination of just compensation. The awards for consequential damages and attorney’s fees were deleted for lack of factual and legal basis.