LBP vs Sps Rosa

LAND BANK OF THE PHILIPPINES, Petitioner,
vs.
SPOUSES ROSA and PEDRO COSTO, Respondents.

G.R. No. 174647               December 5, 2012

(Supreme Court, Third Division)

Facts:

This is a petition for review on certiorari under Rule 45 of the Rules of Court seeking to reverse and set aside the Decision dated July 14, 2006 of the Court of Appeals (CA) in CA-G.R. SP No. 91469, and the Resolution dated September 15, 2006 denying petitioner's motion for reconsideration.

Herein respondents, spouses Rosa and Pedro Costo are the registered owners of a parcel of land located at Catamlangan, Pilar, Sorsogon. After the passage of R.A. No. 6657, respondents voluntarily offered the said property to the Department of Agrarian Reform (DAR) under the Comprehensive Agrarian Reform Program (CARP) and its implementing Rules. Out of the total land area, 7.3471 hectares was deemed qualified for acquisition under the CARP. Petitioner, Land Bank of the Philippines (Land Bank) then computed and valued the said qualified area in the amount of P104,077.01.

However, respondents rejected the valuation. This impelled petitioner to deposit the offer in the form of cash and bonds in favor of respondents as provisional compensation for the acquired property. Thereafter, respondents sought the determination of just compensation with the Provincial Adjudication Board of the DAR.

On July 30, 2002, the Provincial Agrarian Reform Adjudicator (PARAD) rendered a Decision in favor of respondents and recomputed the land valuation, fixing the value of the property at P468,575.92. Petitioner filed a Motion for Reconsideration, but was denied. Aggrieved, pursuant to Section 57 of R.A. No. 6657, petitioner filed a petition for determination of just compensation with the Regional Trial Court (RTC), sitting as a Special Agrarian Court (SAC).

On June 28, 2005, the SAC rendered a Decision finding the valuation made by the PARAD as the more realistic appraisal of the subject property.

Petitioner then sought recourse before the CA, but the appellate court affirmed the decision of the SAC on a ground that petitioner’s lack of merit.

Hence, the present petition before this Court (Supreme Court).

Issues:

·         Whether or not the petitioner, Land Bank of the Philippines, contention that its valuation of just compensation should be preferred.

Held:

            No, the determination of just compensation cases involving the Comprehensive Agrarian Reform Program, the following factors for consideration are taken into account under Section 17 of R.A. 6657:

(1)  the acquisition cost of the land;

(2)  the current value of the properties;

(3)  its nature, actual use, and income;

(4)  the sworn valuation by the owner;

(5)  the tax declarations;

(6)  the assessment made by government assessors;

(7)  the social and economic benefits contributed by the farmers and the farmworkers, and by the government to the property; and

(8)  the non-payment of taxes or loans secured from any government financing institution on the said land, if any.

In a previously decided case (LBP vs. Celada), the court ruled that the factors enumerated under Sec. 17 of R.A. 6657 has already been translated into a basic formula, to wit:

LV = Land Value;

CNI = Capitalized Net Income;

CS = Comparable Sales;

MV = Market Value per Tax Declaration.

If the three factors are present, the basic formula is LV = (CN*0.6) + (CS*0.3) + (MV*0.1), otherwise the following shall govern:

CS is not present: LV = (CNI*0.9) + (MV*0.1);

CNI is not present: LV = (CS*0.9) = (MV*0.1);

Both CNI and CS are not present: LV = MV*2

But, in no case shall the value of idle land using formula MV*2 exceed the lowest value of land within the same estate under consideration or within the same barangay or municipality approved by LBP within 1 year from receipt of claimholder.

The LBP has failed to convince the SC that the RTC abused its discretion or ruled on the matter without evidence, it decided in favor of the respondents denying the petition and affirming the decision of the lower courts.