LAND BANK OF THE PHILIPPINES v.

LEONILA CELADA

FACTS:

Celada owns an agricultural land, 60% of which was identified in 1998 by the Department of Agrarian
Reform (DAR) as suitable for compulsory acquisition under the Comprehensive Agrarian Reform
Program (CARP). Upon indorsement to it for field investigation and valuation, Land Bank valued the said
land at P299,569.61. DAR offered the same amount to Celada as just compensation. Celada, however,
rejected the offer. The matter was then referred to the DAR Adjudication Board (DARAB) for summary
administrative hearing on the determination of just compensation.

During the pendency of the DARAB case, Celada filed a petition for judicial determination of just
compensation, alleging that the current market value of her land was at least P2,129,085.00. In its
answer, Land Bank raised the affirmative defense of non-exhaustion of administrative remedies. It
contended that Celada must first await the outcome of the DARAB case before taking any judicial
recourse. Meanwhile, the DARAB Provincial Adjudicator affirmed the valuation made by Land Bank.
Thereafter, the Special Agrarian Court (SAC), where Celada’s petition was filed, rendered judgment fixing
the value of the land at P354,847.50, finding that Celada’s evidence showed that the neighboring lands
of similar classification were paid higher than what was quoted by Land Bank. It denied Land Bank’s
affirmative defense. The Court of Appeals dismissed Land Bank’s appeal.

Land Bank maintains that the SAC erred in assuming jurisdiction over Celada’s petition for judicial
determination of just compensation despite the pendency of the administrative proceedings before the
DARAB. It also contends that the SAC erred in fixing the just compensation of the land based on the
valuation of neighboring lands instead of its actual land use.

ISSUES:

1.) Whether or not the SAC erred in assuming jurisdiction over the petition for judicial determination of
just compensation pending administrative proceedings before the DARAB;

2.) Whether or not the SAC erred in fixing the just compensation of the land based on the valuation of
neighboring lands

HELD:

The petition is GRANTED.

SAC correctly assumed jurisdiction over determination of just compensation

The SAC did not err in assuming jurisdiction over the petition for determination of just compensation
despite the pendency of the administrative proceedings before the DARAB. As the Court held in Land
Bank of the Philippines v. Court of Appeals, the RTC, sitting as a SAC, has ‘original and exclusive
jurisdiction over all petitions for the determination of just compensation to landowners.’ This ‘original
and exclusive’ jurisdiction of the RTC would be undermined if DAR would vest in administrative officials
original jurisdiction in compensation cases and make the RTC an appellate court for the review of
administrative decision. Although the new rules speak of directly appealing the decision of adjudicators
to the RTCs sitting as SACs, the original and exclusive jurisdiction to determine such cases is in the RTCs.
It should be emphasized that the taking of property under the CARP is an exercise of the power of
eminent domain by the State. The valuation of property or determination of just compensation is a
judicial function. Thus, the SAC properly took cognizance of Celada’s petition for determination of just
compensation.

SAC erred in fixing just compensation based on valuation of neighboring lands

The SAC, however, erred in setting aside Land Bank’s valuation of the land on the sole basis of the higher
valuation given for neighboring properties. It did not apply the DAR valuation formula which considers
capitalized net income, comparable sales and market value per tax declaration as components of land
value.

LAND BANK OF THE PHILIPPINES v. LUZ LIM AND PURITA LIM CABOCHAN

529 SCRA 129 (2007), EN BANC (Carpio Morales, J.)

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.

FACTS: Pursuant to the Comprehensive Agrarian Reform Law, the Department of Agrarian Reform (DAR)
compulsorily acquired lands owned by Luz Lim and Purita Lim Caochan. The Land Bank computed the
value of the property. Lim however rejected Land Bank‘s valuation. A summary administrative
proceeding was conducted before the Provincial Agrarian Reform Adjudicator (PARAD) to determine the
valuation of the property. Dissatisfied with the PARAD‘s decision, Lim and Cabochan filed a petition for
determination of just compensation with the Regional Trial Court.

The RTC adopted the valuation submitted by the appointed commissioner. Both parties moved for
reconsideration. The RTC then reconsidered its earlier decision and increased the valuation.

Landbank, not satisfied, filed a petition for review on certiorari for fixing the valuation of Lim‘s property.

ISSUE: Whether or not the RTC erred in adopting the calculations of the LBP instead of the
Administrative Order of DAR

HELD: In Land Bank of the Philippines v. Spouses Banal, the Court underscored the mandatory nature of
Section 17 of RA 6657 and DAR AO 6-92, as amended by DAR AO 11-94 which provides that 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.‖

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.

LAND BANK OF THE PHILIPPINES vs. FELICIANO F. WYCOCO

G.R. No. 146733 January 13, 2004

FACTS:

This case is a consolidated petition of one seeking review of the decision of CA modifying the decision of
RTC acting as a Special Agrarian Court, and another for mandamus to compel the RTC to issue a writ of
execution and to direct Judge Caspillo to inhibit. Feliciano F. Wycoco is the registered owner of a 94.1690
hectare land. Wycoco voluntarily offered to sell the land to the Department of Agrarian Reform for P14.9
million. DAR offered P2,280,159.82. The area which the DAR offered to acquire excluded idle lands, river
and road located therein. Wycoco rejected the offer, prompting the DAR to indorse the case to the
Department of Agrarian Reform Adjudication Board (DARAB) for the purpose of fixing the just
compensation in a summary administrative proceeding. Thereafter, the DARAB requested LBP to open a
trust account in the name of Wycoco and deposited the compensation offered by DAR.

In the meantime, the property was distributed to farmer-beneficiaries. On April 13, 1993, Wycoco filed
the instant case for determination of just compensation with the Regional Trial Court of Cabanatuan City
against DAR and LBP. On March 9, 1994, the DARAB dismissed the case on its hand to give way to the
determination of just compensation by the RTC. Meanwhile, DAR and LBP filed their respective answered
that the valuation of Wycoco’s property was in accordance with law and that the latter failed to exhaust
administrative remedies by not participating in the summary administrative proceedings before the
DARAB which has primary jurisdiction over determination of land valuation. On November 14, 1995, the
trial court rendered a decision in favor of Wycoco. It ruled that there is no need to present evidence in
support of the land valuation in as much as it is of public knowledge that the prevailing market value of
agricultural lands sold in Licab, Nueva Ecija is from P135,000.00 to 150,000.00 per hectare. The court thus
took judicial notice thereof and fixed the compensation for the entire 94.1690 hectare land at P142,500.00
per hectare or a total of P13,428,082.00. It also awarded Wycoco actual damages for unrealized profits
plus legal interest. The DAR and the LBP filed separate petitions before the Court of Appeals. The petition
brought by DAR on jurisdictional and procedural issues was dismissed. This prompted Wycoco to file a
petition for mandamus before this Court praying that the decision of the Regional Trial Court of
Cabanatuan City be executed, and that Judge Caspillo be compelled to inhibit himself from hearing the
case. The petition brought by LBP on both substantive and procedural grounds was likewise dismissed by
the Court of Appeals. However, the Court of Appeals modified its decision by deducting from the
compensation due to Wycoco the amount corresponding to the 3.3672 hectare portion of the 94.1690
hectare land which was found to have been previously sold by Wycoco to the Republic. LBP contended
that the Court of Appeals erred in its ruling.

ISSUES:

1. Whether or not the RTC acquired jurisdiction over the case acting as Special Agrarian Court.

2. Assuming that it acquired jurisdiction, whether or not the compensation arrived at supported by
evidence

. 3. Whether or not Wycoco can compel DAR to purchase the entire land. 4. Whether or not the awards
of interest and damages for unrealized profits is valid.

HELD:

1. Yes, the RTC acting as Special Agrarian Court, acquired jurisdiction of the case. Sections 50 and 57 of
Republic Act No. 6657 (Comprehensive Agrarian Reform Law of 1988) provides: Section 50.Quasi-judicial
Powers of the DAR. – The DAR is hereby vested with primary jurisdiction to determine and adjudicate
agrarian reform matters and shall have exclusive original jurisdiction over all matters involving the
implementation of agrarian reform, except those falling under the exclusive jurisdiction of the
Department of Agriculture (DA) and the Department of Environment and Natural Resources (DENR)….
Section 57.Special Jurisdiction. – The Special Agrarian Court shall have original and exclusive jurisdiction
over all petitions for the determination of just compensation to landowners, and the prosecution of all
criminal offenses under this Act.

2. No, the compensation arrived is not supported by evidence. In arriving at the valuation of Wycoco’s
land, the trial court took judicial notice of the alleged prevailing market value of agricultural lands without
apprising the parties of its intention to take judicial notice thereof. Section 3, Rule 129 of the Rules on
Evidence provides: Sec. 3. Judicial Notice. When Hearing Necessary. – During the trial, the court, on its
own initiative, or on request of a party, may announce its intention to take judicial notice of any matter
and allow the parties to be heard thereon. After trial and before judgment or on appeal, the proper court,
on its own initiative, or on request of a party, may take judicial notice of any matter and allow the parties
to be heard thereon if such matter is decisive of a material issue in the case. The trial court should have
allowed the parties to present evidence thereon instead of practically assuming a valuation without basis.
Only the market value was taken into account in determining the just compensation. Since other factors
were not considered, the case was remanded for determination of just compensation.

3. No, the DAR cannot be compelled to purchase the entire property voluntarily offered by Wycoco. The
power to determine whether a parcel of land may come within the coverage of the Comprehensive
Agrarian Reform Program is essentially lodged with the DAR. That Wycoco will suffer damages by the
DAR’s non-acquisition of the approximately 10 hectare portion of the entire land which was found to
be not suitable for agriculture is no justification to compel DAR to acquire the whole area. 4. Yes,
Wycoco’s claim for payment of interest is partly meritorious. The trust account opened as the mode of
payment of just compensation should be converted to a deposit account. The conversion should be
retroactive in application in order to rectify the error committed by the DAR in opening a trust account
and to grant the landowners the benefits concomitant to payment in cash or LBP bonds. Otherwise,
petitioner’s right to payment of just and valid compensation for the expropriation of his property
would be violated. The interest earnings accruing on the deposit account of landowners would suffice to
compensate them pending payment of just compensation. The award of actual damages for unrealized
profits should be deleted because Wycoco failed to show proof of loss. Wycoco’s petition for
mandamus in G.R. No. 146733 was dismissed. The decision of the Regional Trial Court of Cabanatuan City,
acting as Special Agrarian Court cannot be enforced because there is a need to remand the case to the
trial court for determination of just compensation. Likewise, the prayer for the inhibition of Judge Rodrigo
S. Caspillo was denied for lack of basis.

PHIL. VETERANS BANK V. CA

18 Jan. 2000

Facts:

P’s land was taken by DAR pursuant to the Comprehensive Agrarian Reform Law. P contended that DAR
adjudicators have no jurisdiction to determine the just compensation for the taking of lands under CARP
because such jurisdiction is vested in the RTC.

Issue: Whether the DAR or RTC has jurisdiction

Held:

DAR has jurisdiction. There is nothing contradictory between the DAR’s primary jurisdiction over “agrarian
reform matters” and exclusive original jurisdiction over “all matters involving the implementation of
agrarian reform,” which includes the determination of questions of just compensation, and the RTC’s
“original and exclusive jurisdiction” over all petitions for the determination of just compensation to the
landowner. In accordance with settled principles of administrative law, primary jurisdiction is vested in
the DAR as an administrative agency to determine in a preliminary manner the reasonable compensation
to be paid for the lands taken under CARP, but such determination is subject to challenge in the courts.

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