THIRD
DIVISION
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LAND BANK OF THE Petitioner, -
versus – KUMASSIE PLANTATION COMPANY
INCORPORATED, Respondent. x-----------------------------------x KUMASSIE PLANTATION COMPANY
INCORPORATED, Petitioner, - versus - LAND BANK OF THE Respondents. |
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G.R. No. 177404 G.R. No. 178097 Present: YNARES-SANTIAGO, J.,
Chairperson, CHICO-NAZARIO, VELASCO, JR., NACHURA, and PERALTA,
JJ. Promulgated: June
25, 2009 |
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CHICO-NAZARIO,
J.:
Before Us are two consolidated Petitions for Review on Certiorari under Rule 45 of the Rules of
Court,[1]
docketed as G.R. No. 177404 and
G.R.
No. 178097, assailing the Decision,[2]
dated
The
undisputed facts are as follows:
Kumassie Plantation Company Incorporated
(KPCI) is the registered owner of 802.2906 hectares of agricultural land
situated in Basiawan, Santa Maria, Davao del Sur, and covered by Transfer
Certificate of Title (TCT) No. 646.[4] In 1982, KPCI and Philippine Cocoa
Corporation (PCC) entered into a contract of lease whereby the former agreed to
lease the said land together with the improvements thereon to the latter for a
period of 25 years beginning
On 18 February 1992, a portion of the aforementioned land,
measuring 457.9952 hectares, planted with coconuts and cocoa (subject land),
was compulsorily acquired by the Department of Agrarian Reform (DAR), Region
XI, Davao City, for distribution to farmer-beneficiaries pursuant to Republic
Act No. 6657, otherwise known as the Comprehensive Agrarian Reform Law of 1988.[7] The DAR then requested the Land Bank of the
Philippines (LBP) to determine the value of the subject land.[8] LBP pegged the value of the subject land at P19,140,965.00
or equivalent to P41,792.94 per hectare.[9] DAR offered to KPCI said amount as
compensation for the subject land,[10]
but it was rejected by KPCI for being “unreasonably low.”[11] Despite the rejection by KPCI of the
valuation of the subject land by LBP, the amount of P19,140,965.00 was
deposited by LBP, upon the instructions of DAR, in the name and for the account
of KPCI.[12] KPCI withdrew from LBP the entire amount in
cash and bonds.[13]
DAR
then advised the Department of Agrarian Reform Adjudication Board (DARAB), on
DAR
next directed the Register of Deeds of Digos, Davao del Sur, on
On
P160,000.00 per
hectare, or equivalent to a total amount of P73,279,232.00, less the
amount of P19,140,965.00 which KPCI had previously withdrawn from LBP.[19]
Subsequently,
LBP and the DAR filed with the RTC their respective Answers contending that the
Complaint was prematurely filed as KPCI failed to exhaust administrative
remedies; that KPCI was already paid just compensation for the subject land,
determined to be P41,792.94 per hectare, for a total amount of P19,140,965.91;
and that KPCI admitted in the Complaint having received such amount from LBP.
LBP asserted that it correctly calculated the value of the subject land to be P19,140,965.91,
applying the formula prescribed in DAR Administrative Order (DAO) No. 6, Series
of 1992, as amended by DAO No. 11, Series of 1994. At the end of their respective Answers, both
LBP and DAR sought the dismissal of the Complaint of KPCI.[20]
The
RTC thereafter directed the parties to submit the names of their respective
nominees for commissioners in Civil Case No. 25,045-97.[21] KPCI nominated Oliver A. Morales (Morales),
President of Cuervo Appraisers Incorporated,[22]
while LBP submitted the name of a certain Engineer Romeo Cabanial.[23] For its part, the DAR endorsed Tomasa L.
Miranda (Miranda), a DAR employee.[24] The RTC appointed Morales and Miranda as
commissioners. The two subsequently took
their oaths of office as court-appointed commissioners.[25]
Meanwhile,
the DARAB issued, on
After
trial in Civil Case No. 25,045-97, the RTC rendered its Decision on P100,000.00 per
hectare. In arriving at said valuation,
the RTC considered the location of the subject land, the nature of the trees
planted thereon, and the reasons stated in Morales’ appraisal report. The RTC then ordered LBP and DAR to pay KPCI an
amount equivalent to P100,000.00 per hectare as just compensation for
the subject land, plus legal interest computed from
LBP
filed with the RTC a Motion for Reconsideration of the foregoing Decision;[29]
while DAR filed a Notice of Appeal, manifesting that it would appeal said RTC
Decision to the Court of Appeals.[30]
On
On
P100,000.00
per hectare. Nevertheless, it ruled that
the imposition of legal interest should be deleted, as there was no delay on
the part of LBP in depositing the amount of P19,140,965.91 in the
account of KPCI, which amount was admittedly withdrawn by KPCI. The fallo
of the Decision of the Court of Appeals reads:
WHEREFORE, premises
considered, the Decision of the Regional Trial Court (RTC), 11th
Judicial Region, Br. 15,
LBP
and KPCI each filed its own Motion for Reconsideration of the
Hence,
LBP and KPCI separately sought recourse from this Court by virtue of the
Petitions for Review presently before us, docketed as G.R. No. 177404 and G.R. No.
178097, respectively. The two
Petitions were consolidated since they arose from the same set of facts.[37]
The procedure for the determination of compensation cases under
Republic Act No. 6657, as devised by this Court,[38]
commences with the valuation by the LBP of the lands taken by the State from
private owners under the land reform program. Based on the valuation of the land by the LBP,
the DAR makes an offer to the landowner through a written notice. In case the landowner rejects the offer, a
summary administrative proceeding is held and, afterwards, depending on the
value of the land, the Provincial Agrarian Reform Adjudicator (PARAD), the
Regional Agrarian Reform Adjudicator (RARAD), or the DARAB, fixes the price to
be paid for the said land. If the
landowner still does not agree with the price so fixed, he may bring the matter
to the RTC, acting as
In the process of determining the just compensation due to
landowners, it is a necessity that the RTC takes into account several factors
enumerated in Section 17 of Republic Act No. 6657, as amended, to wit:
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 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.
Being the government agency primarily charged with the
implementation of the agrarian reform program, DAR issued DAO No. 6, Series of
1992, as amended, filling out the details necessary for the implementation of
Section 17 of Republic Act No. 6657. DAR
translated the factors specified in Section 17 of Republic Act No. 6657, into a
basic formula, presented as follows in DAO No. 6, Series of 1992, as amended:
Where:
CNI =
Capitalized Net Income
CS = Comparable
Sales
MV = Market
Value per Tax Declaration
The above
formula shall be used if all the three factors are present, relevant, and
applicable.
A.1 When the CS
factor is not present and CNI and MV are applicable, the formula shall be:
A.2 When the CNI
factor is not present, and CS and MV are applicable, the formula shall be:
A.3 When both
the CS and CNI are not present and only MV is applicable, the formula shall be:
In
its Petition docketed as G.R. No. 177404,
LBP maintains that the RTC and the Court of Appeals erred in their valuation of
the subject land at P100,000.00 per hectare because both courts did not
consider the factors enumerated in Section 17 of Republic Act No. 6657 and the
formula for valuation of lands under DAO No. 6, Series of 1992, as amended.[39]
While the determination of just compensation is essentially a
judicial function which is vested in the RTC acting as Special Agrarian Court,
we, nonetheless, disregarded the determination of just compensation made by the
RTC in Land Bank of the Philippines v.
Banal,[40] Land Bank of the Philippines v. Celada,[41]
and in Land Bank of the Philippines v.
Lim,[42]
when, as in this case, the judge gravely abused his discretion by not taking
into full consideration the factors specifically identified by law and
implementing rules.
In several cases, we have reminded the special agrarian courts to
resolve just determination cases judiciously and with utmost observance of
Section 17 of Republic Act No. 6657 and the administrative orders issued by the
DAR to implement said statutory provision.
In Land Bank of the
Philippines v. Banal,[43]
we emphasized that the factors laid down in Section 17 of Republic Act No. 6657
and the formula stated in DAO No. 6, Series of 1992, as amended, must be
adhered to by the RTC in fixing the valuation of lands subjected to agrarian
reform, thus:
In determining just compensation, the RTC is required to consider several
factors enumerated in Section 17 of R.A. 6657, as amended, thus:
x x x x
These
factors have been translated into a basic formula in [DAO 6-92], as amended by [DAO 11-94], issued pursuant to the DAR’s
rule-making power to carry out the object and purposes of R.A. 6657, as
amended.
x
x x x
While the determination of just compensation involves the exercise of judicial discretion, however, such discretion must be discharged within the bounds of the law. Here, the RTC wantonly disregarded R.A. 6657, as amended, and its implementing rules and regulations. ([DAO 6-92], as amended by [DAO 11-94]).
x
x x x
WHEREFORE,
x x x. The trial judge is directed to observe strictly the procedures
specified above in determining the proper valuation of the subject
property. (Emphasis ours.)
Again, in Land Bank of the
Philippines v. Celada,[44]
we stressed that the special agrarian court cannot ignore, without violating
Republic Act No. 6657, the formula provided by the DAR for the determination of
just compensation. We rejected the valuation fixed by the RTC because it failed
to follow the DAR formula:
While [Special
Agrarian Court] is required to consider the acquisition cost of the land, the
current value of like properties, its nature, actual use and income, the sworn
valuation by the owner, the tax declaration and the assessments made by the
government assessors to determine just compensation, it is equally true that
these factors have been translated into a basic formula by the DAR pursuant to
its rule-making power under Section 49 of R.A. No. 6657. As the government agency principally tasked
to implement the agrarian reform program, it is the DAR’s duty to issue rules
and regulations to carry out the object of the law. [DAO] No. 5, s. of 1998 precisely “filled in
the details” of Section 17, RA No. 6657 by providing a basic formula by which
the factors mentioned therein may be taken into account. The [
It
is elementary that rules and regulations issued by administrative bodies to
interpret the law which they are entrusted to enforce, have the force of law,
and are entitled to great respect.
Administrative issuances partake of the nature of a statute and have in
their favor a presumption of legality.
As such, courts cannot ignore administrative issuances especially when,
as in this case, its validity was not put in issue. Unless an administrative order is declared
invalid, courts have no option but to apply the same. (Emphasis ours.)
Instead, we sustained the valuation made by the LBP, which was
patterned after the applicable administrative order issued by the DAR, viz:
[LBP] arrived at its valuation by using
available factors culled from the Department of Agriculture and Philippine
Coconut Authority, and by computing the same in accordance with the formula
provided, thus –
COMPUTATION (Applicable Formula):
Comparable Land Transactions (P x
x x x ____ ) = P x-x-x
Capitalized Net Income:
Cassava 16,666.67 x 0.90 = 15,000.00
Corn/Coco
26,571.70
= 23,914.53
Market
Value Cassava 8,963.78
x 0.10 = 896.38
per Tax Declaration:
Corn/Coco 10,053.93
= 1,005.39
Computed Value per
Hectare: Cassava 15,896.38; Corn/Coco – 24,919.92
x
x x x
Value per hectare used: Cassava
15,896.38 x 6.0000 has. =
95,378.28
Corn/
Payment due to LO
:
P299, 569.61
The above
computation was explained by Antero M. Gablines, Chief of the Claims,
Processing, Valuation and Payment Division of the
ATTY. CABANGBANG: (On direct):
x x x x
q. What are the items needed for the Land Bank
to compute?
a. In accordance with Administrative Order
No. 5, series of 1998, the value of the land should be computed using the
capitalized net income plus the market value. We need the gross production of
the land and its output and the net income of the property.
q. You
said “gross production.” How would you
fix the gross production of the property?
a.
In that Administrative Order No. 5, if the owner of the land is cooperative, he
is required to submit the net income. Without submitting all his sworn
statements, we will get the data from the DA (Agriculture) or from the coconut
authorities.
x x x x
q.
In this recommended amount which you approved, how did you arrive at this
figure?
a.
We used the data from the Philippine (Coconut) Authority and the Agriculture
and the data stated that Cassava production was only 10,000 kilos per hectare;
corn, 2,000 kilos; and coconuts, 15.38 kilos per hectare. The data stated that
in the first cropping of 1986, the price of cassava was P1.00 per kilo;
corn was sold at P7.75 per kilo; and the Philippine Coconut Authority
stated that during that time, the selling price of coconuts was P8.23
per kilo.
q.
After these Production data and selling price, there is here a “cost of
operation,” what is this?
a.
It is the expenses of the land owner or farmer. From day one of the cultivation
until production. Without the land owner’s submission of the sworn statement of
the income, production and the cost, x x x Administrative Order No. 5 states
that x x x we will use 20% as the net income, meaning 80% of the production in
peso. This is the cost of valuation.
q.
80 % for what crops?
a.
All crops except for coconuts where the cost of expenses is only 20%.
q.
Summing all these data, what is the value per hectare of the cassava?
a.
The cassava is P15,896.38.
q.
How about the corn x x x intercropped with coconuts?
a.
P24,919.92.
Under the
circumstances, we find the explanation
and computation of [LBP] to be sufficient and in accordance with applicable
laws. [LBP’s] valuation must thus be upheld.[45]
(Emphases ours.)
In Apo Fruits Corporation v.
Court of Appeals,[46]
we once more gave paramount importance to the criteria inscribed in Section 17
of Republic Act No. 6657 and the pertinent DAOs. In sustaining therein the
valuation of the special agrarian court, we ratiocinated:
[T]he Court affirmed the due consideration given by the RTC of the factors
specified in Section 17, Republic Act No. 6657. Again, the proper valuation
of the subject premises was reached with clear regard for the acquisition cost
of the land, current market value of the properties, its nature, actual use and
income, inter alia — factors that are
material and relevant in determining just compensation. These are the very same factors laid down in a formula by DAR A.O. No.
5. Due regard was thus given by the RTC to Republic Act No. 6657, DAR A.O. No.
5 and prevailing jurisprudence when it arrived at the value of just
compensation due to AFC and HPI in this case.
The Court En Banc in Land Bank of the Philippines v. Lim[47]
was confronted with the question of whether the RTC can resort to any other
means of determining just compensation aside from Section 17 of Republic Act
No. 6657 and DAO No. 6, Series of 1992, as amended. The Court resolved the issue in the negative
and pronounced that Section 17 of Republic Act No. 6657 and DAO No. 6, Series
of 1992, as amended, are mandatory and are not mere guides that the RTC may disregard.
Citing Banal and Celada, we held in Lim that:
In Land Bank of the Philippines v. Spouses
Banal [434 SCRA 543], this Court
underscored the mandatory nature of Section 17 of RA 6657 and DAR AO 6-92, as
amended by DAR AO 11-94, x x x.
x x x x
And in LBP v. Celada [479 SCRA 495], this
Court set aside the valuation fixed by the RTC of Tagbilaran, which was based
solely on the valuation of neighboring properties, because it did not apply the
DAR valuation formula. x x x.
x x x x
Consequently, as
the amount of P2,232,868 adopted by the RTC in its December 21, 2001
Order was not based on any of the mandatory formulas prescribed in DAR AO
6-92, as amended by DAR AO 11-94, the Court of Appeals erred when it
affirmed the valuation adopted by the RTC.
(Emphases ours.)
In the instant case, the RTC did not pay particular attention to
Section 17 of Republic Act No. 6657 and DAO No. 6, Series of 1992, as
amended. It merely cited the location of
the subject land, nature of the trees planted thereon, and Morales’ appraisal
report, as bases for fixing the value of the subject land at P100,000.00
per hectare; which are not among the factors mentioned in Section 17 of
Republic Act No. 6657. Also, the RTC did
not apply the formula stated under DAO No. 6, Series of 1992, as amended, in
fixing the value of the subject land.
This undoubtedly constitutes an obvious departure from the settled
doctrine previously discussed herein regarding the mandatory nature of Section
17 of Republic Act No. 6657 and DAO No. 6, Series of 1992, as amended.
Further, Morales, in his appraisal report, used the market data
approach (a method which based the value of the subject land on sales and
listings of similar properties situated within the area), and the income
approach (a procedure which based the value of the subject land on the
potential net benefit that may be derived from its ownership) in determining
the value of the subject land.[48] Morales did not explicitly state or even
impliedly use Section 17 of Republic Act No. 6657 and DAO No. 6, Series of
1992, as amended, in his appraisal report for the subject land. Neither was there any foundation for
concluding that the market data approach and income approach conformed to
statutory and regulatory requirements.
More importantly, Morales himself admitted during the trial that he did
not consider Republic Act No. 6657 and DAO No. 6, Series of 1992, as amended,
in his appraisal report for the subject land, despite being aware of the said
law and rules for a long time.[49] This being the case, the valuation of the
subject land, as contained in the appraisal report adopted by the RTC, cannot
be deemed to be in compliance with the requirements under Section 17 of
Republic Act No. 6657 and DAO No. 6, Series of 1992, as amended.
In contrast, LBP arrived at its valuation of the subject land by
considering the factors identified under Section 17 of Republic Act No. 6657,
and by computing the same in accordance with the formula in DAO No. 6, Series
of 1992, as amended. The meticulous
calculations of LBP are reproduced below:
FORMULA USED IN
THE VALUATION OF THE SUBJECT PROPERTY
The
records show that Acquisition Cost (CA), Market Value based on Mortgage (MVM)
and Comparable Sales (CS) are not applicable.
Hence, pursuant to paragraph A.2 of DAR
Adm. Order No. 6, Series of 1992, the applicable formula in arriving at the
land Value is: LV = (CNI x 0.9) + (MV
[x] 0.1).
Considering
that the subject property is covered by an existing lease contract, the Lease
Rental Income was also considered in the computation of the Capitalized Net
Income (CNI) by following the formula prescribed under paragraph B.7 of Dar
Adm. Order No. 6, Series of 1992, thus:
CNI
= LRI
.12
DISCUSSION OF
THE FORMULAE
The
pertinent provisions of DAR Adm. Order
No. 6, Series of 1992, reads:
B.
Capitalized
Net Income (CNI) – This shall refer to the difference between the gross sales
(AGP x SP) and total cost of operations (CO) capitalized at 12%.
Expressed in equation form:
CNI
= (AGP x SP) – CO
.12
Where: CNI = Capitalized Net Income
AGP = One year’s
Average Gross Production immediately preceding the date of offer in case of VOS
or date of notice of coverage in case of CA.
SP = Selling
price shall refer to average prices for the immediately preceding calendar year
from the date of receipt of the claimfolder by LBP from DAR for processing
secured from the Department of Agriculture (DA) other appropriate regulatory
bodies or in their absence, from Bureau of Agricultural Statistics. If possible, SP data shall be gathered from the
barangay or municipality where the property is located. In the absence thereof, SP may be secured
within the province or region.
CO = Cost
of Operations
Whenever the cost of operations could
not be obtained or not be obtained or verified, and assumed net income rate
(NIR) of 20% shall be used. Landholdings
planted to coconut which are productive at the time of offer/coverage shall
continue to use the 70% NIR x x x
12 = Capitalized
Rate
B.1 Industry
data on production, cost of operation, and selling price shall be obtained from
government/private entities. Such
entities shall include, but not limited to the Department of Agriculture (DA),
the Sugar Regulatory Authority (SRA), the Philippine Coconut Authority (PCA)
and other private persons/entities knowledgeable to the concerned industry.
B.2 The
landowner shall submit a statement of net income derived from the land subject
of acquisition. This shall include among
others, total production and cost of operations on a per crop basis, selling
price/s (farm gate) and such other data as may be required.
x
x x x
In case of failure by the landowner to
submit the statement x x x or the data stated therein cannot be
verified/validated from the farmers, LBP may adopt any available industry data
or in the absence thereof may conduct an industry study on the specific crop
which will be used in determining the production, cost and net income of the
subject landholding.
x x x x
B.7
For landholdings planted to permanent crops which are covered by
existing lease contract, the following formula shall be used in the computation
of the CNI:
CNI/Ha.
= LRI
.12
Where: LRI = Lease Rental Income per
Hectare/Year as stipulated under the contract.
x
x x x
c.
In
case the lease rental is a variable amount (e.g., progressively increasing
during the term of the lease), LRI is computed as follows:
Sum
of Annual lease Rental per Hectare over
LRI
= the remaining Term of the Lease
Contract
Remaining Term of Lease, Years
x
x x x
D. Market Value per Tax Declaration (MV)
shall refer to the market value per Tax Declaration (TD) issued before
CAPITALIZED NET
INCOME
Re:
AGP
LANDBANK
adopted as AGP the average production indicated in the Contract of Lease which
is 44 metric tons of copra per month (net) or 528 metric tons a year. Converted into kilos, the AGP per hectare is
658.12 kilos.
Re:
Selling Price
As
Selling Price, LANDBANK used the 1992 Philippine Coconut Authority Data which
is P6.87 per kilo as the same is the average price for the immediately
preceding calendar year from the date of receipt by LANDBANK of the claimfolder
from DAR for processing in 1993 pursuant to paragraph 5, Item B of DAR Adm. Order No. 6, Series of 1992,
above quoted.
Re:
Capitalization Rate
A
12% capitalization rate was used in accordance with paragraph 8, Item B of DAR Adm. Order No. 6, Series of 1992.
Using
the foregoing as input, the CNI for copra is P37,677.37 per hectare (658.12
kilos x P6.87 per kilo / .12).
Re:
LRI
Pursuant
to Item B, paragraph B.7, sub-paragraph c of DAR Adm. Order No. 6, Series of 1992, LANDBANK computed the total
lease rentals for the remaining period of the lease contract (1994 to 2007 or
14 years). Thus, LRI = (690 x 4) + (P680
x 5) + (P1,120 x 5) divided by 14 or P904.29 per hectare. Following the formula: 12% over LRI (P904.29), the CNI per
hectare (Lease Contract) is P7,535.75.
MARKET VALUE PER
TAX DECLARATION
In
the computation of the market Value per Tax Declaration (MV), the unit market
values of both the land and the coconut trees were determined based on the 1991
Schedule of Market Values for agricultural properties in Sta. Maria, Davao del
Sur. Per the said Schedule of Market
Values, the subject property is classified as third class cocoland and has a
unit market value of P6,240.00 per hectare while the cocotrees have a
unit market value of P62.40 per tree.
The
unit market values of both the land and the cocotrees were multiplied with the
location adjustment factor of 98% and the results were in turn multiplied with
the Consumer Price Index (1.1254). Thus,
the total market value as adjusted for the land is P6,882.05 per hectare
and P4,129.23 for the cocotrees or a total of P11,011.28 per
hectare.
In
summation:
CNI (copra) - P37,677.37 per ha.
CNI (Lease contract)
- P 7,535.75 per ha.
Total CNI - P45,213.12
per ha.
MV (Land) - P 6,882.05 per ha.
MV
(cocotree) - P 4,129.23 per ha.
Total
MV - P11,011.28 per ha.
Following
the formula: P45,213.12 x 0.9) P40,691.81
+ MV 0.1 (11,011.28 x 0.1) P1,101.13 x 457.9952 hectares, the total value of the area subject to acquisition
is P19,140,965.91.[50] (Emphases supplied).
We
find the foregoing exhaustive explanation and thorough computations of LBP to
be sufficient and in accordance with Section 17 of Republic Act No. 6657 and
DAO No. 6, Series of 1992, as amended.
Hence, the Court affirms the valuation by LBP of P41,792.94 per
hectare, or a total of P19,140,965.91, for the subject land.
Since
we have already resolved the issue in G.R
No. 177404, we shall now discuss and determine the matters brought up in G.R. No. 178097.
In
its Petition docketed as G.R. No. 178097,
KPCI argues that the imposition of legal interest as damages is warranted
because LBP has delayed in paying just compensation for the subject land. KPCI alleges that the act of LBP in appealing
the decisions of the RTC and the Court of Appeals reveals the intent of the LBP
to delay the payment of just compensation to KPCI.[51]
Given our finding that it is the valuation of the subject land by
the LBP that is correct and in compliance with the requirements of the law and
administrative rules and regulations, then the issue of interest, raised by
KPCI in its Petition, has actually become irrelevant. The amount of P19,140,965.91,
representing the valuation of LBP for the entire subject land, was deposited
for the account of and in the name of KPCI, which the latter had admittedly
already withdrawn. The just compensation
for the subject land is, thus, already fully paid.
Even if we were still to address the issue of interest, we shall
decide against KPCI.
In expropriation cases, interest is due the landowner if there was
delay in payment. The imposition of
interest was in the nature of damages for the delay in payment, which in effect
makes the obligation on the part of the government one of forbearance. It follows that the interest in the form of
damages cannot be applied where there was prompt and valid payment of just
compensation.[52] In Apo
Fruits Corporation v. Court of Appeals,[53]
we stressed that interest on just compensation is imposed only in case of delay
in the payment thereof, which must be sufficiently established.
There is nothing in the records to show that LBP was delayed in
the payment of just compensation to KPCI.
In fact, contrary to the claim of KPCI, it was paid just compensation by
LBP with dispatch.
The mere fact that LBP appealed the decisions of the
RTC and the Court of Appeals does not mean that it deliberately delayed the
payment of just compensation to KPCI.
LBP is an agency created primarily to provide financial support in all
phases of agrarian reform pursuant to Section 74 of Republic Act No. 3844 and
Section 64 of Republic Act No. 6657. It is vested with the primary
responsibility and authority in the valuation and compensation of covered
landholdings to carry out the full implementation of the Agrarian Reform
Program. It may agree with the DAR and
the landowner as to the amount of just compensation to be paid to the latter
and may also disagree with them and bring the matter to court for judicial
determination.[54] This makes the LBP an indispensable party in
cases involving just compensation for lands taken under the Agrarian Reform
Program, with a right to appeal decisions in such cases that are unfavorable to
it. Having only exercised its right to
appeal in this case, LBP cannot be penalized by making it pay for interest.
WHEREFORE,
in view of the foregoing:
1) The Petition of Land Bank of the P41,792.94 per hectare, for
a total of P19,140,965.91, by the Land Bank of the Philippines is APPROVED,
and such amount is DECLARED PAID IN FULL; and
2) The Petition of Kumassie Plantation
Company Incorporated is DENIED.
No costs.
SO ORDERED.
|
|
MINITA V. CHICO-NAZARIOAssociate
Justice |
WE
CONCUR:
Associate
Justice
Chairperson
PRESBITERO J. VELASCO, JR.
Associate Justice |
ANTONIO EDUARDO B. NACHURA Associate Justice |
|
|
|
DIOSDADO M. PERALTAAssociate Justice |
|
ATTESTATION
I attest that the conclusions in
the above Decision were reached in consultation before the case was assigned to
the writer of the opinion of the Court’s Division.
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson, Third Division
CERTIFICATION
Pursuant to Section 13, Article VIII
of the Constitution, and the Division Chairperson’s Attestation, it is hereby
certified that the conclusions in the above Decision were reached in
consultation before the case was assigned to the writer of the opinion of the
Court’s Division.
REYNATO S. PUNO
Chief
Justice
[1] Rollo (G.R. No. 177404), pp. 33-55 and
(G.R. No. 178097) pp. 29-49.
[2] Penned
by Associate Justice Normandie B. Pizarro with Associate Justices Edgardo A.
Camello and Ricardo R. Rosario, concurring; CA rollo, pp. 81-90.
[3]
[4] Records,
pp. 12-14.
[5]
[6]
[7]
[8] Id.
at 22; Executive Order No. 405, dated 14 June 1990, vests the Land Bank of the
Philippines the primary responsibility to determine the land valuation and
compensation for all private lands covered by Republic Act No. 6657. See Philippine Veterans Bank v. Court of Appeals,
379 Phil. 141, 145 (2000).
[9] Records,
p. 15.
[10]
[11]
[12]
[13]
[14] Pursuant
to Section 16(d) of Republic Act No. 6657.
[15] CA
rollo, p. 188; rollo (G.R. No. 177404), pp. 107-113.
[16] Records,
p. 22.
[17]
[18]
[19]
[20]
[21]
[22]
[23]
[24]
[25]
[26]
[27]
[28] P100,000.00
per hectare, and the total area of the subject land which is 457.9552 hectares,
then total just compensation would amount to P45,795,200.00. The RTC likewise failed to mention
subtracting from the total just compensation awarded the P19,149.965.91
already received by KPCI.
[29]
[30]
[31]
[32] CA
rollo, pp. 16-33.
[33]
[34]
[35]
[36] CA
rollo, pp. 118-139.
[37] Rollo (G.R. No. 178097), p. 159.
[38] Land Bank of the
[39] Rollo, (G.R. No. 177404), pp. 42-53.
[40] Supra
note 38.
[41] G.R.
No. 164876,
[42] G.R.
No. 171941,
[43] Supra
note 38 at 549-554.
[44] Supra
note 41 at 506-507.
[45]
[46] G.R.
No. 164195,
[47] Supra
note 42 at 134-136.
[48] Records
pp. 99-146.
[49] TSN,
[50] Rollo (G.R. No. 177404), pp. 108-113; CA rollo, pp. 332-335.
[51] Rollo (G.R. No. 178097), pp. 42-44.
[52] Apo Fruits Corporation v. Court of Appeals,
G.R. No. 164195, 19 December 2007, 541 SCRA 117, 141; Land Bank of the Philippines v. Wycoco, 464 Phil. 83, 100 (2004),
citing Reyes v. National Housing
Authority, 443 Phil. 603, 616 (2003) and Republic v. Court of Appeals, 433 Phil. 106, 122-123 (2002).
[53]
[54] Heirs of Roque F. Tabuena v. Land Bank of the