CASE DIGEST: Land Bank v. ARC

G.R. No. 188046: July 24, 2013

LAND BANK OF THE PHILIPPINES, Petitioner, v. AMERICAN RUBBER CORPORATION, Respondent.

VILLARAMA, JR., J.:

FACTS:

American Rubber Corporation (respondent) is the registered owner of two parcels of land with a combined area of 940.7276 hectares situated in Barangay Ba1uno, Isabela City, Basilan. The first parcel with an area of 927.9366 hectares is covered by Transfer Certificate of Title (TCT) No. T-1286, while the second parcel consists of 12.7910 hectares under TCT No. T-1285.

Sometime in January 1998, respondent voluntarily offered to sell the two parcels and another property (TCT No. T-4747) together with all improvements for the total price ofP105,732,921.00. The total area acquired by DAR was 888.6489 hectares valued by petitioner at P55,682,832.67.

Since respondent rejected DARs offer based on petitioners valuation, the Provincial Agrarian Reform Office (PARO) endorsed the claim folder to the Department of Agrarian Reform Adjudication Board (DARAB) Central Office for summary administrative proceedings. Exasperated by DARABs inaction for more than two years, respondent filed in the Regional Trial Court (SAC) a suit for judicial determination of just compensation.

Pursuant to the Rules of Court, the SAC designated three commissioners nominated by the parties and their report was submitted to the Court. After the SAC denied its motion for reconsideration, petitioner filed a petition for review under Rule 43 with the CA.

Petitioner assails the CA in affirming the SAC valuation which merely adopted the Commissioners Report which, in turn, is based solely on the recommended valuation by respondents private appraiser, Cuervo Appraisers, Inc. using a different criteria. Hence, this petition.

ISSUE: Whether or not the basis of the just compensation is correct

HELD: No. CA decision reversed and set aside

Political Law- "just compensation" for parcels of land taken pursuant to the agrarian reform program as "the full and fair equivalent of the property taken from its owner by the expropriator."

The measure of compensation is not the takers gain but the owners loss.Just compensation means the equivalent for the value of the property at the time of its taking. It means a fair and full equivalent value for the loss sustained. All the facts as to the condition of the property and its surroundings, its improvements and capabilities should be considered. Thus, the current value of like properties should have been considered by petitioner to accurately determine the value of the land at the time of taking, that is, in August 2000 when respondents title was transferred to the Government.

In Land Bank of the Philippines v. Heirs of Salvador Encinas we said that:

The "taking of private lands under the agrarian reform program partakes of the nature of an expropriation proceeding." In computing the just compensation for expropriation proceedings, the RTC should take into consideration the "value of the land at the time of the taking, not at the time of the rendition of judgment." "The time of taking is the time when the landowner was deprived of the use and benefit of his property, such as when title is transferred to the Republic.

However, while the CA correctly observed that petitioners valuation omitted an integral factor mandated by Section 17, the records are bereft of any supporting evidence to compute the CS. The documents submitted by the respondent to the Commissioners consisted merely of sworn affidavits of adjacent owners/sellers and not registerable deeds of sale. The SACs decision actually did not contain any discussion of its application of any formula to the facts established by evidence, as it merely adopted the Commissioners Report, which in turn was based solely on the findings and computation of the Cuervo Appraisal Report.

Considering, therefore, that the SAC based its valuation on a different formula, while petitioner failed to take into full consideration the factors set forth in Section 17, and in the absence of sufficient evidence for the determination of just compensation, we are constrained to remand the present case to the SAC for the determination of just compensation in accordance with Section 17 of RA 6657, DAR AO 5, Series of 1998 and Joint DAR-LBP MC No. 7, Series of 1999. The said trial court may, motu proprio or at the instance of any of the parties, again appoint one or more commissioners to ascertain facts relevant to the dispute and file a written report thereof.

Petition GRANTED.

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