LBP vs Puyat

LAND BANK OFTHE PHILIPPINES, Petitioner,
vs.
Heirs of MAXIMO PUYAT and GLORIA PUYAT, represented by

Attorney-in-Fact Marissa Puyat, Respondent.

G.R. No. 175055               June 27, 2012

(Supreme Court, First Division)

Facts:

Gloria and Maximo Puyat (deceased) owns a parcel of riceland consisting of 46.8731 hectares. The said land was subjected to acquisition pursuant to PD 27 but the records does not show when the DAR acquired the same. Sometime in December 1989 DAR then, issued several emancipation patents in favor of various farm-beneficiaries. The Puyat's however, did not receive any compensation for the acquisition.

Sometime in September 1992 LBP received DAR's instruction to pay the just compensation to the Puyats. The LBP made its evaluation, but the heirs of the Puyat rejected the valuation and filed a complaint for determination of just compensation with the RTC. The following are the valuation of the property:

1. LBP = P 92,752.10 @ P 2,012.50 per hectare (in compliance with the formula under PD 27 and EO 228. LBP also contended that the valuation should be done at the time of the taking (1976));

2. RTC = P 4,430,900.00 @ P 100,000.00 per hectare since 44.3090 hectares were distributed to farmer-beneficiaries  and 6% legal interest from the date of taking until the amount is fully paid (due to delay in payment);

3. CA = same as RTC but modified the legal interest not from 1990 but from March 20, 1990 for precision.

Issue:

• Whether or not lands acquired pursuant to PD 27 be valued using the factors in Sec. 17 of RA 6657.

• Whether or not the 6% legal interest proper in this case.

Held:

RA 6657 should govern, in catena of decided cases of the Supreme Court it has been held that, when the government takes property pursuant to PD 27, but does not pay the landowner his just compensation until after the affectivity of RA 6657, it becomes more equitable to determine the just compensation using RA 6657.

The SC finds that there is no need to disturb the legal interest issue since there is no current jurisprudence to substantiate such change, and the respondents (Heirs of Maximo and Gloria Puyat) did not contest the interest awarded by the lower courts.

Thus, there is no need to remand the case to the lower court for the determination of just compensation, during the pendency of the case, Congress enacted RA 9700 further amending RA 6657, the amendment provides:

Sec. 7. The DAR in coordination with the PARC shall plan and program the final acquisition and distribution of all remaining unacquired and undistributed agricultural lands from the effectivity of this Act until June 30, 2014. Lands shall be acquired and distributed as follows:

xxxxx

 ...that all previously acquired lands wherein valuation is subject to challenge by landowners shall be completed and finally resolved pursuant to Sec. 17 of RA 665...

xxxx

That the just compensation has already been computed pursuant to Sec. 17 of RA 6657 by the CA.