LAND BANK OF THE PHIL vs.

HEIRS OF ELEUTERIO CRUZ

PETITION FOR REVIEW ON CERTIORARI RULE 45 assailing the Decision and Resolution of the CA
affirming the decision of the RTC/SAC approving the ordered payment of the amount of just
compensation fixed by the CAGAYAM PROVINCIAL AGRARIAN REFORM ADJUDICATION BOARD
(PARAD) in favor of herein respondents.

FACTS:

 LBP (P) was designated by Sec 64 of RA 6654 as the financial intermediary of the agrarian reform
program of the government.

 Heirs of Eleutrio Cruz (R) is the registered owner of an unirrigated riceland situated in lakambini,
Tuao, Cagayan with a total of 13.7320 hectares.

 13.5550 hectares was place by the government under the coverage of the land transfer program
under PD No. 27.

 (P) pegged the value at 106,935.76 based on the guidelines of PD No. 27 and EO 228.

 (R) rejected valuation and instituted a SUMMARY PROCEDDING FOR THE PRELIMINARY
DETERMINATION OF JUST COMPENSATION before the PARAD.

 PARAD rendered a decision fixing the just compensation in the amount of P80,000.00 per
hectare. (P) sought reconsideration but was unsuccessful.

 23January2000 - (P) filed a PETITION FOR THE DETERMINATION OF JUST COMPENSATION before
RTC of Tuguegarao City.

 (P) presented evidence that the average production of 25 and 40 cavans per hectare.

 (R) presents Lorna Cruz Felipe (one of the heirs of Eleuterio Cruz) - production capacity of 80 to
100 cavans per hectare. She also claimed that the current market value of the property was
between P150,000.00 to P200,000.00.

 7Dec2005 - SAC rendered a decision: Judgment is hereby rendered fixing the amount of
P80,000.00 to be the just compensation of the land subject of this case with an area of 13.7320
hectares ordering the LBP to pay (R) Lorna Cruz-Felipe the amount of P1,098,560.00 in the
manner provided by RA 6657 by way of full payment of the said just compensation.

 SAC held that the 80k per hectare fixed by the PARAD should be accorded weight and probative
value. It disregarded respondents’ claim that the valuation should be based on the current
market value of the landholding since no evidence was adduced in support of the claim.

 (P) MR was denied. (P) elevated to CA questioning the total land area as well as the amount of
just compensation.

 17Aug2006 - CA rendered a decision - partly granting petitioner’s appeal. The total land area
should be 13.5550 hectares not 13.7230 hectares but appellate court affirmed the SAC Decision
fixing Just Compensation at P80,000.00.

ISSUE:

WHETHER OR NOT THE FORMULA USED BY THE PARAD FOR COMPUTING FOR JUST
COMPENSATION IS THE RIGHT FORMULA IN THIS SITUATION WHERE THE LAND WAS ACQUIRED BY
VIRTUE OF PD 27 AND EO 228
Petitioner’s contentions:

 Hence, the instant petition, arguing that the formula set forth in PD No. 27/EO No. 228 should be
applied in fixing just compensation since respondents’ landholding was acquired under PD27.

 The values in EO 228 are applicable to lands acquired under PD 27 in cognizance o the
well-settled rule that JUST COMPENSATION IS THE VALUE OF THE PROPERTY AT THE TIME OF
THE TAKING ON 21 OCT 1972.

HELD:

 The petition lacks merit.

 In Paris vs Alfeche, while under PD 27 tenant farmers are already deemed owners of the land
they to, they are still required to pay the cost of the land before the title is transferred to them
and that pending the payment of just compensation, actual title to the tanented land remains
with the landowner.

 During Paris the application of the process of agrarian reform was still incomplete. The process
should now be completed under RA 6657 with PD 27 and EO 228 applying only suppletorily.

 The just compensation due to respondents have not been settled by the time RA 6657 became
effective.

 Sec 17 RA 6657 - Determination of Just Compensation - the cost of acquisition of land, the
current value of like properties, its nature, actual use and income, the sworn valuation by the
owner, the tax declaration, and the assessment made by the government assessors.

 Land Bank of the Phils. vs. Celada - the factors enumerated under sec 17 of RA 6657 had already
been translated into a basic formula and pursuant the to its rule-making power under sec 47 RA
6657, DAR A.O. No. 5 Series of 1998 should be applied in computing just compensation.

 In LBP vs. Sps. Banal and LBP vs. Lim DAR A.O. No. 6 Series of 1992 was applied.

 PARAD’S Decision dated 23 Nov 1999 with just compensation computed in the amount of
P80,000.00 did not adhere to the formula prescribed in any of the aforesaid regulations.

 SAC meanwhile referred to DAR A.O. No.6 Series of 1992 as amended, which requires values of
Capitalized Net Income, Comparable Sales and Market Value based on tax Declaration.
Moreover, said formula has been superseeded by DAR A.O. No. 05 series of 1998 which also
requires values for Capitalized Net Income, Comparable Sales and Market Value.

 No evidence was presented by the respondents therefore SAC ruled affirming the computation
of PARAD.

 GENERAL RULE: Factual findings of the trial court, especially when affirmed by the CA are binidng
and conclusive on the court. (X) factual findings are grounded entirely on speculation, surmises,
or conjectures or when the findings are conclusions without citation of specific evidence on
which they are based.

 PET FOR CERTIORARI is DENIED the Decision and Resolution of the CA is reversed and set aside.
Agra Case remanded to RTC for determination of just compensation using DAR AO 5 Series of
1998.