HIRD DIVISION

[G.R. No. 143275. September 10, 2002.]

LAND BANK OF THE PHILIPPINES, Petitioner, v. ARLENE DE LEON and

BERNARDO DE LEON, Respondents.

DECISION

CORONA, J.:

Before us is a petition for review of the resolution, 1 dated February 15, 2000, of the
Court of Appeals 2 dismissing the ordinary appeal of petitioner Land Bank of the
Philippines (LBP, for brevity), and resolution 3 dated May 22, 2000 denying the motion
for reconsideration thereof.
chanrob1es virtua1 1aw 1ibrary

The undisputed facts as found by the appellate court are as follows: chanrob1es virtual 1aw library

The petitioners-appellees Arlene de Leon and Bernardo de Leon are the registered
owners of a parcel of land situated at San Agustin, Concepcion, Tarlac covered by TCT
No. 163051 with a total area of 50.1171 hectares. The subject property was voluntarily
offered for sale to the government pursuant to RA 6657 at P50,000.00 per hectare. The
Department of Agrarian Reform (DAR) made a counter offer of P17,656.20 per hectare,
or a total amount of P884,877.54, but the same was rejected. Another offer was made
by DAR increasing the amount to P1,565,369.35. In view of De leon’s failure to respond
to the new offer made by DAR, the Department of Agrarian Reform Adjudication Board
(DARAB) took cognizance of the case pursuant to Sec. 16 (d) of RA 6657.
Subsequently, the DARAB issued an Order directing respondent-appellant LBP to
recompute the value of the subject property in accordance with DAR Administrative
Order No. 6, Series of 1992. Applying the pertinent provisions of the said DAR
administrative order, LBP arrived at a recomputed land value as follows: chanrob1es virtual 1aw library

Land Use Area Acquired Value/hectare Total/Land Value

Sugarland 32.4187 P61,758.85 P2,002,141.63

Riceland 16.6984 P28,449.80 P475,066.14

Idle land 1.0000 P14,523.78 P14,523.78

or an aggregate amount of P2,491,731.65, which was again rejected by de leons. In a

Petition dated October 27, 1994, filed with the Regional Trial Court, Branch 63, Tarlac,
which is the designated Special Agrarian Court in the area, de leon asked the court,
among others, to fix the just compensation of the subject property.

In due time the court rendered a summary judgment on December 19, 1997 fixing the
compensation of the subject property as follows: chanrob1es virtual 1aw library

a. P1,260,000.00 for the 16.69 hectares of riceland;

b. P2,957,250.00 for the 30.4160 hectares of sugarland.

Within the time allowed lbp filed a Motion for Reconsideration which was subsequently
denied by the Court. 4

x          x           x

On March 17, 1998, the Department of Agrarian Reform filed in the Court of Appeals a
petition for review of the decision of the Special Agrarian Court. The said petition,
docketed as CA-G.R. SP No. 47005, was assigned to the Special Third (3rd) Division of
the Court of Appeals. Petitioner LBP also initiated in the Court of Appeals an appeal of
the same decision of the Special Agrarian Court by filing a notice of appeal. Docketed as
CA-G.R. CV No. 60365, the said ordinary appeal was assigned to the Fourth (4th)
Division of the Court of Appeals.

On November 6, 1998, the Special Third (3rd) Division of the appellate court, through
then Associate Justice Minerva Gonzaga-Reyes, 5 rendered in CA-G.R. SP No. 47005 a
decision, 6 the dispositive portion of which reads: chanrob1es virtual 1aw library

WHEREFORE, premises considered, the petition for review is GIVEN DUE COURSE. The
decision dated February 9, 1998 is partially reconsidered. The trial court is ordered to
recompute the compensation based on the selling price of palay at 213.00 per cavan.
Petitioner is ordered to pay legal interest at 6% of the compensation so fixed from 1990
until full payment is made by the government.

SO ORDERED. 7

Thereafter, on February 15, 2000, the Fourth (4th) Division of the Court of Appeals
dismissed petitioner LBP’s ordinary appeal (CA-G.R. CV No. 60365), in a resolution
dated February 15, 2000, the dispositive portion of which reads: chanrob1es virtua1 1aw 1ibrary

WHEREFORE, the appeal is DISMISSED for lack of merit. 8

In dismissing the ordinary appeal (CA-G.R. CV No. 60365) instituted by petitioner LBP,
the appellate court reasoned that the mode of appeal followed by the petitioner was
erroneous considering that Section 60 of RA 6657, otherwise known as the
Comprehensive Agrarian Reform Law, mandates that appeals from decisions of Special
Agrarian Courts should be by petition for review. Therefore, the notice of appeal filed by
LBP was ineffectual and did not stop the running of the period of appeal. Also, the
appellate court took note of the decision rendered by the Special Third (3rd) Division of
the same court involving the same issue and parties, to wit: chanrob1es virtual 1aw library

All these notwithstanding LBP does not stand to lose anything at all. While it did suffer a
setback in this instant case LBP in one way or the other still we note that it is likewise
victorious in the appeal brought by the DAR (CA-G.R. SP 47005). In a decision rendered
on November 6, 1998 this court ordered the trial court to recompute the compensation
based on the selling price of palay at P213.00 per cavan. Thus to this effect with more
reason that we should deny the appeal — even granting the mode of appeal as availed
of is correct — to avoid any contradiction of this division’s with that of the other. 9

Petitioner LBP filed a motion for reconsideration but the same was denied in a
resolution dated May 22, 2000.

Hence, this petition questioning the resolutions of the Fourth (4th) Division of the Court
of Appeals on the following assignment of errors: chanrob1es virtual 1aw library

IN RULING THAT SECTION 60 OF RA 6657 PROVIDES THE PROPER MODE FOR THE
REVIEW OF THE DECISIONS OF THE SPECIAL AGRARIAN COURTS DESPITE SECTION
61 OF RA 6657 WHICH EXPRESSLY MANDATES THAT THE RULES OF COURT SHALL
GOVERN THE REVIEW OF THE DECISIONS OF THE SPECIAL AGRARIAN COURTS BY THE
COURT OF APPEALS;

II

IN NOT RECOGNIZING THAT SECTION 61 OF RA 6657 PREVAILS OVER SECTION 60 OF

RA 6657, INASMUCH AS THE MODE OF APPEAL OF A COURT’S DECISION IS A MATTER
OF PROCEDURE WHICH IS COVERED BY THE EXCLUSIVE RULE-MAKING POWER OF THE
SUPREME COURT UNDER SECTION 5(5), ARTICLE VIII OF THE 1987 CONSTITUTION
AND IN ACCORDANCE WITH EXISTING JURISPRUDENCE;

III

IN DECLARING THAT THE SUPREME COURT MERELY MADE AN INADVERTENT

"MISTAKE" IN REVISING SECTION 1, RULE 43 OF THE RULES OF COURT AND
REMOVING THE DECISIONS OF THE SPECIAL AGRARIAN COURT FROM THE LIST OF
THOSE APPEALABLE TO THE COURT OF APPEALS BY PETITION FOR REVIEW; AND

IV

IN DISMISSING THE APPEAL OF THE PETITIONER, DESPITE ITS RULING THAT THE
SUPREME COURT MADE A MISTAKE IN ITS ADMINISTRATIVE ORDERS, RENDERING
SUCH DISMISSAL AS HIGHLY UNJUST, OPPRESSIVE AND CONTRARY TO DUE PROCESS
OF LAW. 10

The case at bar requires an interpretation of Sections 60 and 61 of RA 6657. The said
provisions provide that: chanrob1es virtual 1aw library

Section 60. Appeals. — An appeal may be taken from the decision of the Special
Agrarian Courts by filing a petition for review with the Court of Appeals within fifteen
(15) days from receipt of notice of the decision; otherwise, the decision shall become
final.
chanrob1es virtua1 1aw 1ibrary

Section 61. Procedure in Review. — Review by the Court of Appeals or the Supreme
Court, as the case may be, shall be governed by the Rules of Court. The Court of
Appeals, however, may require the parties to file simultaneous memoranda within a
period of fifteen (15) days from notice, after which the case is deemed submitted for
decision.

De leons point to Section 60 of RA 6657 to support their view that the mode of appeal
initiated by petitioner LBP was erroneous. On the other hand, petitioner LBP believes
that the mode of appeal it used is permissible under Section 61 of the same law.

What indeed is the proper mode of appeal from decisions of the Regional Trial Courts,
sitting as Special Agrarian Courts, in the determination of just compensation — an
appeal by way of a petition for review or an ordinary appeal?

Section 2 of Rule 41 of the 1997 Revised Rules of Civil Procedure provides for three
modes of appeal, to wit: chanrob1es virtual 1aw library

Sec. 2. Modes of Appeal. —

(a) Ordinary appeal. — The appeal to the Court of Appeals in cases decided by the
Regional Trial Court in the exercise of its original jurisdiction shall be taken by filing a
notice of appeal with the court which rendered the judgment or final order appealed
from and serving a copy thereof upon the adverse party. No record on appeal shall be
required except in special proceedings and other cases or multiple or separate appeals
where the law or these Rules so require. In such cases, the record on appeal shall be
filed and served in like manner.

(b) Petition for Review. — The appeal to the Court of Appeals in cases decided by the
Regional Trial Court in the exercise of its appellate jurisdiction shall be by petition for
review in accordance with Rule 42.

(c) Appeal by Certiorari. — In all cases where only questions of law are raised or
involved, the appeal shall be to the Supreme Court by petition for review
on certiorari in accordance with Rule 45.
Petitioner LBP, in its bid to maintain the legitimacy of its appeal, contends that the
proper mode of appeal from a decision of the Special Agrarian Court is by way of a
notice of appeal due to the reference by Section 61 of RA 6657 to the Rules of Court as
the governing procedure for appeals to the Court of Appeals. This being the case, the
petitioner claims that the procedure for ordinary appealed cases provided for in Section
2(a) of Rule 41 of the 1997 Revised Rules of Civil Procedure must be followed, that is, a
notice of appeal is required in order to perfect the appeal. According to the petitioner,
this is the proper mode of appeal in the case at bar considering that the appealed
decision is that of the Regional Trial Court in the exercise of its original jurisdiction.
Moreover, Section 1 of Rule 43 of the 1997 Revised Rules of Civil Procedure 11
(pertaining to appeals by way of petitions for review to the Court of Appeals of
decisions of quasi-judicial agencies and the Court of Tax Appeals), does not include
decisions of the Regional Trial Courts acting as Special Agrarian Courts.

We deny the petition.

A petition for review, not an ordinary appeal, is the proper procedure in
effecting an appeal from decisions of the Regional Trial Courts acting as
Special Agrarian Courts in cases involving the determination of just
compensation to the landowners concerned. Section 60 of RA 6657 clearly and
categorically states that the said mode of appeal should be adopted. There is no room
for a contrary interpretation. Where the law is clear and categorical, there is no room
for construction, but only application. 12

According to the LBP, Section 61 of RA 6657 should be followed, not Section 60. The
reference by Section 61 to the Rules of Court implies that an ordinary appeal requiring
a notice of appeal is the proper manner of appealing decisions of Special Agrarian
Courts on just compensation because Section 2(a) of Rule 41 of the 1997 Revised Rules
of Civil Procedure provides that decisions of the Regional Trial Courts in the exercise of
their original jurisdiction follow the procedure governing ordinary appeals.chanrob1es virtua1 1aw 1ibrary

We do not agree.

First, there is no conflict between Section 60 and 61 of RA 6657 inasmuch as the Rules
of Court do not at all prescribe the procedure for ordinary appeals as the proper mode
of appeal for decisions of Special Agrarian Courts. Section 61 in fact makes no more
than a general reference to the Rules of Court and does not even mention the
procedure for ordinary appeals in Section 2, Rule 41 of the 1997 Revised Rules of Civil
Procedure as the appropriate method of elevating to the Court of Appeals decisions of
Special Agrarian Courts in eminent domain cases.

Second, the failure to mention Special Agrarian Courts in Section 1 of Rule 43 of the
Revised Rules of Civil Procedure cannot be construed to mean that a petition for review
is not permissible for decisions of the said special courts. In fact, the said Rule is not
relevant to determine whether a petition for review is the proper mode of appeal from
decisions of Regional Trial Courts in agrarian cases, that is, when they act as Special
Agrarian Courts. Section 1 of Rule 43 of the 1997 Revised Rules of Civil Procedure
merely mentions the Court of Tax Appeals and the other different quasi-judicial
agencies without exclusivity in its phraseology. Such omission cannot be construed to
justify the contention that a petition for review is prohibited for decisions on special
agrarian cases inasmuch as the category is for quasi-judicial agencies and tax courts to
which the Regional Trial Courts do not properly belong. Although Supreme Court
Circular No. 1-91 13 (precursor to Rule 43 of the Revised Rules of Civil Procedure)
included the decisions of Special Agrarian Courts in the enumeration requiring petition
for review, its non-inclusion later on in Rule 43 merely signifies that it was
inappropriately classified as a quasi-judicial agency.

What is indisputable is that Section 60 expressly regards a petition for review as the
proper way of appealing decisions of agrarian courts. So far, there is no rule prescribed
by this Court expressly disallowing the said procedure.
Third, far from being in conflict, Section 61 of RA 6657 can easily be harmonized with
Section 60. The reference to the Rules of Court means that the specific rules for
petitions for review in the Rules of Court and other relevant procedures in appeals filed
before the Court of Appeals shall be followed in appealed decisions of Special Agrarian
Courts. Considering that RA 6657 cannot and does not provide the details on how the
petition for review shall be conducted, a suppletory application of the pertinent
provisions of the Rules of Court is necessary. In fact, Section 61 uses the word "review"
to designate the mode by which the appeal is to be effected. The reference therefore by
Section 61 to the Rules of Court only means that the procedure under Rule 42 for
petitions for review is to be followed for appeals in agrarian cases.

According to the petitioner, an ordinary appeal prescribed under the Rules of Court
should prevail over a petition for review provided under Section 60 of RA 6657
inasmuch as a contrary interpretation would violate the constitutional provision granting
to the Supreme Court the power to "promulgate rules concerning the protection and
enforcement of constitutional rights, pleadings, practice, and procedure in all courts,
the admission to the practice of law, the Integrated Bar, and Legal Assistance to the
underprivileged." (Emphasis supplied) 14

As earlier mentioned, there is nothing in the Rules of Court that categorically prohibits
the adoption of the procedure for petitions for review of decisions of Special Agrarian
Courts. Section 60 of RA 6657 and the provisions of the Rules of Court can be
harmonized and can co-exist.

Moreover, the same Section 5(5), Article VIII, of the 1987 Philippine Constitution
quoted by the petitioner states that" (r)ules of procedure of special courts and quasi-
judicial bodies shall remain effective unless disapproved by the Supreme Court."
Section 60 is obviously a special procedure. Contrary to the petitioner’s contention, it
cannot be otherwise merely because it was formulated by the legislature and not by
any special body. As long as the said section provides for a particular process for the
governance of the special court concerned, the provision is accurately classified as a
special procedure. Subject to constitutional limitations, the statutory enactment of a
special procedure cannot be said to encroach on the power of this Court to formulate
rules of procedure for the reason that we have not yet provided for a particular process
specifically governing agrarian courts. In fact, this Court exercises its constitutional
power to promulgate special rules of procedure by adopting Sections 60 and 61 of RA
6657 declaring a petition for review as the proper mode of appeal to the Court of
Appeals.chanrob1es virtua1 1aw 1ibrary

The reason why it is permissible to adopt a petition for review when appealing cases
decided by the Special Agrarian Courts in eminent domain cases is the need for
absolute dispatch in the determination of just compensation. Just compensation means
not only paying the correct amount but also paying for the land within a reasonable
time from its acquisition. Without prompt payment, compensation cannot be considered
"just" for the property owner is made to suffer the consequences of being immediately
deprived of his land while being made to wait for a decade or more before actually
receiving the amount necessary to cope with his loss. 15 Such objective is more in
keeping with the nature of a petition for review.

Unlike an ordinary appeal, a petition for review dispenses with the filing of a notice of
appeal or completion of records as requisites before any pleading is submitted. A
petition for review hastens the award of fair recompense to deprived landowners for the
government-acquired property, an end not foreseeable in an ordinary appeal. This is
exemplified by the case at bar in which the petition for review before the Special Third
(3rd) Division (CA-G.R. SP No. 47005) was disposed of way ahead of the ordinary
appeal filed before the Fourth (4th) Division (CA-G.R. CV No. 60365) in the Court of
Appeals.

Inasmuch as the notice of appeal filed by petitioner LBP did not stop the running of the
reglementary period to file a petition for review, the time to appeal the decision of the
Special Agrarian Court has lapsed, rendering the said decision final and executory.
WHEREFORE, the appealed RESOLUTIONS, dated February 15, 2000, and May 22,
2000, respectively, of the Court of Appeals are hereby AFFIRMED. No costs.

SO ORDERED.
.R. No. 164195             February 6, 2007

APO FRUITS CORPORATION and HIJO PLANTATION, INC., Petitioners,

vs.
THE HON. COURT OF APPEALS and LAND BANK OF THE PHILIPPINES, Respondents.

DECISION

CHICO-NAZARIO, J.:

Apo Fruits Corporation (AFC) and Hijo Plantation, Inc. (HPI) are the registered owners of five parcels
of agricultural lands located in San Isidro, Tagum, Davao Province, to wit:

Apo Fruits Corporation

Transfer Certificate of Area (Ha.)

Title (TCT)1 No.

T-1133592 115.2179

   

T-1133663 525.1304

Hijo Plantation, Inc.4

TCT No. Area (Ha.)

T-10361 155.8408

   

T-10362 170.7980

   

T-10363 478.89205

On 12 October 1995, AFC and HPI voluntarily offered to sell the above parcels of land to the
government.6 After the initial processing at the Department of Agrarian Reform (DAR) of the
Voluntary Offer to Sell (VOS)7 application of AFC and HPI, it was referred to the Land Bank of the
Philippines (LBP) for initial valuation. On 16 October 1996, AFC and HPI received separately from
the DAR’s Provincial Agrarian Reform Officer (PARO) of Davao province a notice of land acquisition
and valuation, informing AFC that the value of the properties has been placed at ₱86,900,925.88 or
₱165,484.47 per hectare8 while HPI’s properties were valued at ₱164,478,178.14.9   Both AFC and
1awphi1.net

HPI considered the valuations unreasonably low and inadequate as just compensation for the
properties.

On 5 November 1996, AFC rejected the valuation for both TCTs No. T-113366 and
No.113359.10 AFC applied for the shifting of the mode of acquisition for TCT No. 11335911 from VOS
to Voluntary Land Transfer/Direct Payment Scheme.12 HPI also rejected the valuation of its three
parcels of land covered by TCTs No. T-10361, No. T-10362 and No. T-10363. 13

Owing to the rejection by both AFC and HPI of LBP’s valuation, the DAR requested LBP to deposit
the amounts equivalent to their valuations in the names and for the accounts of AFC and HPI.14 AFC
thereafter withdrew the amount of ₱26,409,549.86, while HPI withdrew the amount of
₱45,481,706.76, both in cash from LBP. The DAR PARO then directed the Register of Deeds of
Davao to cancel the TCTs of AFC and HPI to the said properties and to issue a new one in the name
of the Republic of the Philippines.
After the issuance of the certificate of title in the name of the Republic of the Philippines, the
Register of Deeds of Davao, upon the request of the DAR, issued TCTs and Certificates of Land
Ownership Award to qualified farmer-beneficiaries.

On 14 February 1997, AFC and HPI filed separate complaints for determination of just compensation
with the DAR Adjudication Board (DARAB). Despite the lapse of more than three years from the
filing of the complaints, the DARAB failed and refused to render a decision on the valuation of the
land. Hence, two complaints15 for determination and payment of just compensation were filed by AFC
and HPI before Branch 2 of the Regional Trial Court (RTC) of Tagum City (acting as a Special
Agrarian Court), which were subsequently consolidated.

Agrarian Case No. 54-200016 filed by AFC covers two parcels of land in San Isidro, Tagum, Davao,
with an aggregate area of 640.3483 hectares previously assessed by LBP with a valuation of
₱86,900,925.88.

On the other hand, Agrarian Case No. 55-200017 filed by HPI relates to the other three parcels of
land in Tagum City, with a total area of 814.5308 hectares, likewise, previously assessed by LBP
with a valuation of ₱164,478,178.14.

Summons was served on 23 May 2000 to defendants DAR and LBP. The trial court appointed as
Commissioners18 persons it considered competent, qualified and disinterested to determine the
proper valuation of the properties.

LBP submitted its Answer on 26 July 2000,19 while the DAR Secretary, represented by PARO Pedro
P. Gumabao, filed its Answer20 on 18 August 2000.

The pre-trial order issued by the trial court reads:

This Court will determine the all-embracing concept of Just Compensation, and whether the plaintiff
is entitled to damages, and also whether the value of the land and improvements as determined by
the Land Valuation of Land Bank for the determination of just compensation, and whether the
plaintiff has violated Section 13 of DARAB new rules and procedure.21

The commissioners, together with all the representatives of the parties, conducted an ocular
inspection first on 25 August 200022 and again on 16 December 2000.23

On 21 May 2001, the court-appointed commissioners submitted their appraisal report.24

On 14 September 2001, the case was considered submitted for decision.25

After hearing, the trial court rendered a decision26 dated 25 September 2001, the fallo thereof reads:

WHEREFORE, consistent with all the foregoing premises, judgment is hereby rendered by this
Special Agrarian Court where it has determined judiciously and now hereby fixed the just
compensation for the 1,388.6027 hectares of lands and its improvements owned by the plaintiffs:
APO FRUITS CORPORATION and HIJO PLANTATION, INC., as follows:

First – Hereby ordering after having determined and fixed the fair, reasonable and just
compensation of the 1,338.6027 hectares of land and standing crops owned by plaintiffs –
APO FRUITS CORPORATION and HIJO PLANTATION, INC., based at only P103.33 per
sq. meter, ONE BILLION THREE HUNDRED EIGHTY-THREE MILLION ONE HUNDRED
SEVENTY-NINE THOUSAND PESOS (P1,383,179,000.00), Philippine Currency, under the
current value of the Philippine Peso, to be paid jointly and severally to the herein
PLAINTIFFS by the Defendants-Department of Agrarian Reform and its financial
intermediary and co-defendant Land Bank of the Philippines, thru its Land Valuation Office;

Second – Hereby ordering Defendants – DEPARTMENT OF AGRARIAN REFORM and/or

LAND BANK OF THE PHILIPPINES, thru its Land Valuation Office, to pay plaintiffs-APO
FRUITS CORPORATION and HIJO PLANTATION, INC., interests on the above-fixed
amount of fair, reasonable and just compensation equivalent to the market interest rates
aligned with 91-day Treasury Bills, from the date of the taking in December 9, 1996, until fully
paid, deducting the amount of the previous payment which plaintiffs received as/and from the
initial valuation;
 Third – Hereby ordering Defendants – DEPARTMENT OF AGRARIAN REFORM and/or
LAND BANK OF THE PHILIPPINES, thru its Land Valuation Office, to pay jointly and
severally the Commissioners’ fees herein taxed as part of the costs pursuant to Section 12,
Rule 67 of the 1997 Rules of Civil Procedure, equivalent to, and computed at Two and One-
Half (2 ½) percent of the determined and fixed amount as the fair, reasonable and just
compensation of plaintiffs’ land and standing crops plus interest equivalent to the interest of
the 91-Day Treasury Bills from date of taking until full payment;

Fourth - Hereby ordering Defendants – DEPARTMENT OF AGRARIAN REFORM and/or

LAND BANK OF THE PHILIPPINES, thru its Land Valuation Office, to pay jointly and
severally the attorney’s fees to plaintiffs equivalent to, and computed at ten (10%) Percent of
the determined and fixed amount as the fair, reasonable and just compensation of plaintiffs’
land and standing crops, plus interest equivalent to the 91-Day Treasury Bills from date of
taking until the full amount is fully paid;

Fifth - Hereby ordering Defendants – DEPARTMENT OF AGRARIAN REFORM and/or

LAND BANK OF THE PHILIPPINES, thru its Land Valuation Office to deduct from the total
amount fixed as fair, reasonable and just compensation of plaintiffs’ properties the initial
payment paid to the plaintiffs;

Sixth - Hereby ordering Defendants – DEPARTMENT OF AGRARIAN REFORM and/or

LAND BANK OF THE PHILIPPINES, thru its Land Valuation Office, to pay the costs of the
suit; and

Seventh - Hereby ordering Defendants – DEPARTMENT OF AGRARIAN REFORM and/or

LAND BANK OF THE PHILIPPINES, thru its Land Valuation Office, to pay all the
aforementioned amounts thru The Clerk of Court of this Court, in order that said Court Officer
could collect for payment any docket fee deficiency, should there be any, from the plaintiffs.27

LBP filed a Motion for Reconsideration28 on 5 October 2001 mainly on the ground that the trial court
based its valuation on the value of residential and industrial lands in the area forgetting that the
lands involved are agricultural. LBP also sought a reconsideration of the award of attorney’s fees,
the interest on the compensation over the lands and the order of the trial court regarding the
payment of commissioners’ fees.

In an Order dated 5 December 2001,29 the trial court modified its decision as follows:

WHEREFORE, premises considered, IT IS HEREBY ORDERED that the following modifications as

they are hereby made on the dispositive portion of this Court’s consolidated decision be made and
entered in the following manner, to wit:

On the Second Paragraph of the Dispositive Portion which now reads as follows, as modified:

Second - Hereby ordering Defendants – DEPARTMENT OF AGRARIAN REFORM and/or LAND

BANK OF THE PHILIPPINES, thru its Land Valuation Office, to pay plaintiffs-APO FRUITS
CORPORATION and HIJO PLANTATION, INC., interest at the rate of Twelve (12%) Percent per
annum on the above-fixed amount of fair, reasonable and just compensation computed from the time
the complaint was filed until the finality of this decision. After this decision becomes final and
executory, the rate of TWELVE (12%) PERCENT per annum shall be additionally imposed on the
total obligation until payment thereof is satisfied, deducting the amounts of the previous payments by
Defendant-LBP received as initial valuation;

On the Third Paragraph of the Dispositive Portion which Now Reads As Follows, As Modified:

Third - Hereby ordering Defendants – DEPARTMENT OF AGRARIAN REFORM and/or LAND

BANK OF THE PHILIPPINES, thru its Land Valuation Office, to pay jointly and severally the
Commissioners’ fees herein taxed as part of the costs pursuant to Section 12, Rule 67 of the 1997
Rules of Civil Procedure, equivalent to, and computed at Two and One-Half (2 ½) percent of the
determined and fixed amount as the fair, reasonable and just compensation of plaintiffs’ land and
standing crops and improvements;

On the Fourth Paragraph of the Dispositive Portion which Now Reads As follows, As Modified:
Fourth - Hereby ordering Defendants – DEPARTMENT OF AGRARIAN REFORM and/or LAND
BANK OF THE PHILIPPINES, thru its Land Valuation Office, to pay jointly and severally the
attorney’s fees to plaintiffs equivalent to, and computed at ten (10%) Percent of the determined and
fixed amount as the fair, reasonable and just compensation of plaintiffs’ land and standing crops and
improvements.

Except for the above-stated modifications, the consolidated decision stands and shall remain in full
force and effect in all other respects thereof.30

From this Order, LBP filed a Notice of Appeal dated 27 December 2001.31 The same was given due
course in the Order of the RTC dated 15 May 2002.32 In the same Order, the RTC set aside its Order
dated 5 December 2001 granting execution pending appeal.

Subsequently, the trial court, citing this Court’s ruling in the case of "Land Bank of the Philippines v.
De Leon,"33 that a petition for review, not an ordinary appeal, is the proper mode of appeal from a
decision on the determination of just compensation rendered by a special agrarian court, issued an
Order dated 4 November 200234 recalling its Order dated 15 May 2002 and directed LBP to file a
Petition for Review within the reglementary period. LBP filed a Motion for Reconsideration35 claiming
that the case of Land Bank of the Philippines v. De Leon was not yet final at that time; hence, it is
not certain whether the decision in that case would have a retroactive effect and that appeal is the
appropriate remedy. This was denied by the trial court in its Order dated 12 February 2003.36

On 28 March 2003, LBP filed a Petition for Certiorari37 before the Court of Appeals assailing the 4
November 2002 and 12 February 2003 orders of the trial court.

The Court of Appeals found the petition of LBP meritorious. In a decision38 dated 12 February 2004,
the Court of Appeals held:

WHEREFORE, the petition is GRANTED and the assailed orders dated November 4, 2002 and
February 12, 2003 are NULLIFIED and, accordingly, SET ASIDE.39

AFC and HPI filed a joint Motion for Reconsideration40 which the Court of Appeals denied in its
Resolution dated 21 June 2004.41

Earlier, on 23 January 2003, DAR filed its own separate petition before the Court of Appeals by way
of a Petition for Review.42 In a Resolution43 dated 2 April 2003, the Court of Appeals dismissed the
petition of the DAR for failure to state the material dates under Rule 42, Section 2,44 of the Rules of
Court. The appellate court held:

The importance of stating the material dates cannot be overemphasized. It is only through a
statement thereof in the petition can it be determined whether or not the petition was filed on time.
For its failure to state the material dates, the petition can and should be outrightly dismissed.

xxxx

The petition is also defective in that it failed to attach material portions of the record as would
support the allegations in the petition. More specifically, copies of the alleged motion for
reconsideration filed by the DAR, the order denying it, and the notice of appeal were not attached to
the petition.

For all the foregoing, the court has no alternative but to dismiss the petition.

WHEREFORE, the petition is DISMISSED.45

The Decision of the Court of Appeals in the Petition filed by the DAR in CA-G.R. SP No. 74879
became final and executory and entry of judgment was issued by the appellate court on 7 May
2003.46

On the other hand, from the decision of the Court of Appeals in the Petition filed by LBP in CA-G.R.
SP No. 76222, AFC and HPI filed the present Petition for Review on Certiorari raising the following
issues:
 I.

WHETHER OR NOT THE QUESTIONED DECISION AND RESOLUTION ARE IN ACCORD WITH
LAW OR WITH THE APPLICABLE DECISIONS OF THE SUPREME COURT?

II.

WHETHER OR NOT RESPONDENT LBP IS BOUND BY THE DECISION OF COURT OF

APPEALS IN CA-G.R. SP NO. 74879 AND IS THEREFORE PRECLUDED FROM FILING CA-G.R.
SP NO. 76222?

III.

WHETHER OR NOT THE FILING BY RESPONDENT LBP OF CA-G.R. SP NO. 76222 IS

ALREADY BARRED BY RES JUDICATA?

IV.

WHETHER OR NOT THE RULING OF THE SUPREME COURT IN THE ARLENE DE LEON CASE,
GIVING ONLY PROSPECTIVE EFFECT TO ITS EARLIER RESOLUTION AS TO THE PROPER
MODE OF APPEAL FROM DECISIONS OF SPECIAL AGRARIAN COURTS IS APPLICABLE IN
THE INSTANT CASE?

V.

WHETHER OR NOT RESPONDENT LBP WAS DEPRIVED OF DUE PROCESS AND/OR OF ITS
RIGHT TO APPEAL?

VI.

WHETHER OR NOT THE SUBJECT PETITION (CA-G.R. SP NO. 76222) WAS MERELY
INTERPOSED TO DELAY THE EXECUTION OF SPECIAL AGRARIAN COURT’S "DECISION"
WHICH IS BASED ON EVIDENCE DULY PRESENTED AND PROVED?47

AFC and HPI pray that the Decision and Resolution of the Court of Appeals in CA-G.R. SP No.
76222 be reversed and set aside and that the Decision of the RTC dated 25 September 2001 in
Agrarian Cases No. 54-2000 and No. 55-2000 be declared as final and executory.48

In the case of Land Bank of the Philippines v. De Leon, decided on 10 September 2002,
respondents are the registered owners of a parcel of land. They voluntarily offered the subject
property for sale to the government pursuant to Republic Act No. 6657. Unable to agree on the
valuation of the property offered by the DAR, respondents filed a petition with the RTC (acting as a
Special Agrarian Court) to fix the just compensation of the property. In due time, the RTC rendered
judgment fixing the compensation of the property. Before the Court of Appeals, the DAR and LBP
filed separate petitions. The DAR filed a Petition for Review of the decision of the RTC which was
assigned to the Special 3rd Division of the appellate court. LBP, on the other hand, raised the case
on appeal to the Court of Appeals by way of ordinary appeal. The same was assigned to the 4th
Division of the Court of Appeals. The petition of the DAR was given due course. On the other hand,
the Court of Appeals dismissed LBP’s ordinary appeal on the ground that the same was erroneous.
LBP filed a petition for review before this Court. In Land Bank, we explained:

A petition for review, not an ordinary appeal, is the proper procedure in effecting an appeal from
decisions of the Regional Trial Courts acting as Special Agrarian Courts in cases involving the
determination of just compensation to the landowners concerned. Section 60 of RA 6657 clearly and
categorically states that the said mode of appeal should be adopted. There is no room for a contrary
interpretation. Where the law is clear and categorical, there is no room for construction, but only
application.49

LBP filed a Motion for Reconsideration. In a Resolution of this Court dated 20 March 2003, this Court
emphasized the prospective application of the Decision dated 10 September 2002.
WHEREFORE, the motion for reconsideration dated October 16, 2002 and the supplement to the
motion for reconsideration dated November 11, 2002 are PARTIALLY GRANTED. While we clarify
that the Decision of this Court dated September 10, 2002 stands, our ruling therein that a petition for
review is the correct mode of appeal from decisions of Special Agrarian Courts shall apply only to
cases appealed after the finality of this Resolution.50 (Emphasis supplied.)

Essentially therefore, the rule is that a decision of the RTC acting as a Special Agrarian Court should
be brought to the Court of Appeals via a Petition for Review. The Court of Appeals will no longer
entertain ordinary appeals thereon. However, this rule applies only after the finality of the Resolution
of this Court in Land Bank of the Philippines v. De Leon dated 20 March 2003.

In this case, the Court of Appeals correctly ruled when it gave due course to the appeal of LBP.
LBP’s Notice of Appeal was filed on 27 December 2001. This was given due course by the RTC in
an Order dated 15 May 2002. LBP’s appeal was, thus, perfected before this Court’s Resolution in
the aforementioned Land Bank of the Philippines v. De Leon case. Hence, the Court of Appeals
could give due course to LBP’s petition.

Next we proceed to determine the issue of whether or not the petition of LBP before the Court of
Appeals is barred by the disposition of the Petition for Review filed by the DAR in CA-G.R. SP No.
74879 on the ground of res judicata.

The following are the elements of res judicata:

(a) The former judgment must be final;

(b) The court which rendered judgment must have jurisdiction over the parties and the
subject matter;

(c) It must be a judgment on the merits; and

(d) There must be between the first and second actions identity of parties, subject matter,
and cause of action.51

In this case, the third element of res judicata, i.e., that the former judgment must be on the merits, is
not present. It must be remembered that the dismissal of CA-G.R. SP No. 74879 was based on
technicality, that is, for failure on the part of the DAR to state material dates required by the rules.
Having been dismissed based on a technicality and not on the merits, the principle of res judicata
does not apply. Res judicata applies only where judgment on the merits is finally rendered on the
first.52

Having disposed of the procedural issues involved herein, we shall now proceed to resolve the
substantive questions in this case.

This Court is aware that in the instant case, since LBP’s appeal before the Court of Appeals is to be
given due course, the normal procedure is for us to remand the case to the appellate court for further
proceedings. However, when there is enough basis on which a proper evaluation of the merits of
petitioner’s case may be had, the Court may dispense with the time-consuming procedure in order to
prevent further delays in the disposition of the case.53 Indeed, remand of the case to the lower court
for further reception of evidence is not conducive to the speedy administration of justice and it
becomes unnecessary where the Court is in a position to resolve the dispute based on the records
before it. On many occasions, the Court, in the public interest and expeditious administration of
justice, has resolved action on the merits, instead of remanding them for further proceedings, as
where the ends of justice would not be subserved by the remand of the case54 or where the trial court
had already received all the evidence of the parties.55 Briefly stated, a remand of the instant case to
the Court of Appeals would serve no purpose save to further delay its disposition contrary to the
spirit of fair play.

It is already an accepted rule of procedure for us to strive to settle the entire controversy in a single
proceeding,56 leaving no root or branch to bear the seeds of future litigation. If, based on the records,
the pleadings, and other evidence, the dispute can be resolved by us, we will do so to serve the
ends of justice instead of remanding the case to the lower court for further proceedings.57
The complete records of this case have already been elevated to this Court. The pleadings on
record will fully support this adjudication. We have painstakingly gone over all of LBP’s
representations and arguments, and we found that the material and decisive facts are hardly
disputable. From another perspective, due consideration should also be given to AFC and HPI for
having voluntarily offered to sell their properties, a clear indication of AFC and HPI’s willingness to
participate in the agrarian reform program of the government. In turn, they must be given
compensation that is just and timely. Records indicate that the case has been dragging on for more
than ten years now without the landowners having been fully compensated. We cannot countenance
such a glaring indifference to AFC and HPI’s rights as land owners – they should be afforded all that
is just and due them. To be sure, they deserve nothing less than full compensation to give effect to
their substantive rights.

While eminent domain lies as one of the inherent powers of the state, there is no requirement that it
undertake a prolonged procedure, or that the payment of the private owner be protracted as far as
practicable.58

It is not controverted that this case started way back on 12 October 1995, when AFC and HPI
voluntarily offered to sell the properties to the DAR. In view of the failure of the parties to agree on
the valuation of the properties, the Complaint for Determination of Just Compensation was filed
before the DARAB on 14 February 1997. Despite the lapse of more than three years from the filing
of the complaint, the DARAB failed to render a decision on the valuation of the land. Meantime, the
titles over the properties of AFC and HPI had already been cancelled and in their place a new
certificate of title was issued in the name of the Republic of the Philippines, even as far back as 9
December 1996. A period of almost 10 years has lapsed. For this reason, there is no dispute that
this case has truly languished for a long period of time, the delay being mainly attributable to both
official inaction and indecision,59 particularly on the determination of the amount of just
compensation, to the detriment of AFC and HPI, which to date, have yet to be fully compensated for
the properties which are already in the hands of farmer-beneficiaries, who, due to the lapse of time,
may have already converted or sold the land awarded to them.

Verily, these two cases could have been disposed with dispatch were it not for LBP’s counsel
causing unnecessary delay. At the inception of this case, DARAB, an agency of the DAR which was
commissioned by law to determine just compensation, sat on the cases for three years, which was
the reason that AFC and HPI filed the cases before the RTC. We underscore the pronouncement of
the RTC that "the delay by DARAB in the determination of just compensation could only mean the
reluctance of the Department of Agrarian Reform and the Land Bank of the Philippines to pay the
claim of just compensation by corporate landowners."60

To allow the taking of landowners’ properties, and to leave them empty-handed while government
withholds compensation is undoubtedly oppressive.61

It is in light of the foregoing that this Court will now undertake the final resolution of the present
controversy which, as already elucidated, is within the power of this Court to do.

The concept of just compensation embraces not only the correct determination of the amount to be
paid to the owners of the land, but also the payment of the land within a reasonable time from its
taking. Without prompt payment, compensation cannot be considered "just" inasmuch as the
property owner is being made to suffer the consequences of being immediately deprived of his land
while being made to wait for a decade or more before actually receiving the amount necessary to
cope with his loss.62 Just compensation is defined as the full and fair equivalent of the property taken
from its owner by the expropriator.63 It has been repeatedly stressed by this Court that the measure
is not the taker’s gain but the owner’s loss.64 The word "just" is used to intensify the meaning of the
word "compensation" to convey the idea that the equivalent to be rendered for the property to be
taken shall be real, substantial, full, and ample.65

The two main issues, thus, for determination of this Court are the date of the taking of the property
and the amount of just compensation.66

First, it is settled that the property was taken on 9 December 1996, when a Certificate of Title was
issued in favor of the Republic of the Philippines, and the Certificates of Title of AFC and HPI were
cancelled. The farmer-beneficiaries themselves took possession of the subject properties on 2
January 1997.67

Second, on payment of just compensation, we have previously held:

Eminent domain is an inherent power of the State that enables it to forcibly acquire private lands
intended for public use upon payment of just compensation to the owner. Obviously, there is no
need to expropriate where the owner is willing to sell under terms also acceptable to the purchaser,
in which case an ordinary deed of sale may be agreed upon by the parties. It is only where the
owner is unwilling to sell, or cannot accept the price or other conditions offered by the vendee, that
the power of eminent domain will come into play to assert the paramount authority of the State over
the interests of the property owner. Private rights must then yield to the irresistible demands of the
public interest on the time-honored justification, as in the case of the police power, that the welfare of
the people is the supreme law.

But for all its primacy and urgency, the power of expropriation is by no means absolute (as indeed
no power is absolute). The limitation is found in the constitutional injunction that "private property
shall not be taken for public use without just compensation" and in the abundant jurisprudence that
has evolved from the interpretation of this principle. Basically, the requirements for a proper exercise
of the power are: (1) public use and (2) just compensation.68 (Emphases supplied.)

Section 57 of Republic Act No. 6657 (Comprehensive Agrarian Reform Law) provides:

SEC. 57. Special Jurisdiction. – The Special Agrarian Courts 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. The Rules of Court shall apply to all proceedings
before the Special Agrarian Courts, unless modified by this Act.

The Special Agrarian Courts shall decide all appropriate cases under their special jurisdiction within
thirty (30) days from submission of the case for decision.

To implement the provisions of Republic Act No. 6657, Rule XIII, Section 11 of the DARAB Rules of
Procedure, provides:

Land Valuation and Preliminary Determination and Payment of Just Compensation. – The decision
of the Adjudicator on land valuation and preliminary determination and payment of just
compensation shall not be appealable to the Board but shall be brought directly to the Regional Trial
Courts designated as Special Agrarian Courts within fifteen (15) days from receipt of the notice
thereof. Any party shall be entitled to only one motion for reconsideration. (Emphasis supplied.)

The next question now crops up, who shall determine just compensation? It is now settled that the
valuation of property in eminent domain is essentially a judicial function which is vested with the RTC
acting as Special Agrarian Court. The same cannot be lodged with administrative agencies69 and
may not be usurped by any other branch or official of the government.70

We now come to the issue of just compensation.

LBP argues that the trial court’s valuation of the subject landholdings has incorporated irrelevant
and/or immaterial factors such as the schedule of market values given by the City Assessor of
Tagum, the comparative sales of adjacent lands and the commissioners’ report.71

Section 17 of Republic Act No. 6657, which is particularly relevant, providing as it does the
guideposts for the determination of just compensation, reads, as follows:

Sec. 17. Determination of Just Compensation. – 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
farm-workers 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.72

The RTC provided the following elucidation in its assailed decision:

The recommendation of the Commissioners’ Report for a value of ₱85.00 per sq.m. or ₱850,000.00
per hectare (sic) is founded on evidence. The schedule of market values of the City of Tagum as per
its 1993 and 1994 Revision of Assessment and Property Classification (Exhibit "J-6" and "CC-6")
give the lowest value for residential land at ₱100/sq.m. for 4th class residential land in 1993. In
1994, it gave the lowest value of ₱80.00/sq.m. for barangay residential lot. It appears that certain
portions of the land in question have been classified as Medium Industrial District (Exhibit "J-4" and
"CC-4"). The lowest value as for industrial land, 3rd class in a barangay is ₱130.00 sq.m. The
average of these figures, using the lowest values in Exhibit "6" and "CC-6" yields the figure of
₱103.33 which is even higher by 22.2% than that recommended by the Commissioners. It is even of
judicial notice that assessments made by local governments are much lower than real market value.
Likewise, the value of the improvements thereon, not even considered in the average of ₱103.33. If
considered, this will necessarily result in a higher average value.

In said Appraisal Report, mention has been made on "improvements," and our Supreme Court in
Republic vs. Gonzales, 50 O.G. 2461, decreed the rule, as follows:

If such improvements are permanent in character, consisting of good paved road, playgrounds,
water system, sewerage and general leveling of the land suitable for residential lots together with
electric installations and buildings, the same are important factors to consider in determining the
value of the land. The original cost of such improvements may be considered, with due regard to the
corresponding depreciation. (Davao vs. Dacudao, L-3741, May 8, 1952).

Note should be taken that in said Appraisal Report, permanent improvements on plaintiffs’ lands
have been introduced and found existing, e.g., all weather-road network, airstrip, pier, irrigation
system, packing houses, among others, wherein substantial amount of capital funding have been
invested in putting them up.

This Court, however, notes that the comparative sales (Exhibits "A" to "F") referred to in the
Appraisal Report are sales made after the taking of the land in 1996. However, in the offer of
evidence, the plaintiff offered additional comparative sales of adjacent land from late 1995 to early
1997, ranging from a high of ₱580.00/sq.meter in September 1996 (Exhibit "L-4" for plaintiff Apo and
"EE-4" for plaintiff Hijo) to a low of ₱146.02/sq.meter in October 1997 (Exhibits "L-2" and "EE-2").
The other sales in 1996 were in January 1996 for ₱530.00/sq.meter ( Exhs. "L-3" and "EE-3") and in
December 1996 for ₱148.64/sq.meter (Exhs. "L-2" and "EE-1"). On the other hand, the sale in
December 1995 (Exhs. "L-5" and "EE-5") was made for ₱530.00/sq.meter." The average selling
price based on the foregoing transaction is ₱386.93/sq.meter. The same is even higher by around
350% than the recommended value of ₱85.00, as per the Commissioners’ Report.

The Cuervo Appraisal Report, on the other hand, gave a value of ₱84.53/sq. meter based on the
Capitalized Income Approach. The said approach considered only the use of the land and the
income generated from such use.

The just compensation for the parcels of land under consideration, taking into account the Schedule
of Market Values given by the City Assessor of Tagum (Exhs. "J-6" for Apo "CC-6" for Hijo), the
comparative sales covering adjacent lands at the time of taking of subject land, the Cuervo Report,
and the Appraisal Report is hereby fixed at ₱103.33/sq.meter.

The valuation given by Cuervo and the Appraisal Report of ₱84.53 and ₱85.00, respectively, in this
Court’s judgment, is the minimum value of the subject landholdings and definitely cannot in anyway
be the price at which plaintiffs APO and/or HIJO might be willing to sell, considering that the parcels
of land adjacent thereto were sold at much higher prices, specifically from a low of ₱146.02/sq.meter
to a high of ₱580.00. The average of the lowest value under the 1993 and 1994 Revision of
Assessment and Property Classification (Exhibits "J-6" and "CC-6") were already at
₱103.33/sq.meter, even without considering the improvements introduced on the subject
landholdings.

Moreover, the Commission made the findings that "portions of the land subject of th(e) report may x
x x increase to ₱330.00/sq.meter, specifically th(e) strips of land surrounding the provincial roads"
and made the conclusion that "(c)learly, the value recommended by th(e) Commission, which is only
about ₱85.00/sq.meter is way below the x x x assessed values, which effectively was fixed (as early
as) 1994 or earlier than the Voluntary Offer to Sell of the above plaintiffs’ properties." In the absence
of any evidence to the contrary, the said assessed values are presumed to be prevailing [in]
December 1996, the time of taking of plaintiffs’ landholdings. The Commission further stated that the
average of the said "assessed values as submitted by the City Assessor of Tagum City (is)
₱265.00/sq.meter." This Court, therefore, finds it unfair that the just compensation for the subject
landholdings should only be fixed at ₱85.00/sq.meter.
It is similarly true, however, that the determination of just compensation cannot be made to the
prejudice of defendants or the government for that matter.

Thus, the selling price of ₱580.00/sq. meter nor the average selling price of ₱386.93/sq. meter or the
average assessed value of ₱265.00/sq. meter cannot be said to be the value at which defendants
might be willing to buy the subject landholdings.

This Court, therefore, finds the price of ₱103.33/sq. meter for the subject landholdings fair and
reasonable for all the parties. Said value is even lower than the lowest selling price of ₱148.64 for
sale of adjacent land at the time of the taking of the subject landholdings [in] December 1996. It
approximates, however, the average of the lowest values under the 1993 and 1994 Revision of
Assessment and Property Clarification (Exhs. "J-6" and "CC-6") of ₱103.33. The said figure will
further increase, if the Court will further consider the improvements introduced by plaintiffs, which
should be the case. Moreover, the said value of ₱103.33/sq. meter is more realistic as it does not
depart from the government recognized values as specified in the 1993 and 1994 Revised
Assessment and Property Classification of Tagum City. This Court finds the evidence of the plaintiffs
sufficient and preponderant to establish the value of ₱103.33/sq. meter.73

The trial court further rationalized its award thus:

It may be admitted that plaintiffs’ properties are agricultural; however, it is simply beyond dispute that
in going about the task of appraising real properties, as in the instant cases, "all the facts as to the
condition of the property and its surroundings, its improvements and capabilities, may be shown and
considered in estimating its value." (Manila Railroad Company vs. Velasquez, 32 Phil. 287, 314). It is
undeniable that plaintiffs’ agricultural lands as borne out from the records hereof, and remaining
unrebutted, shows that all weather-roads network, airstrip, pier, irrigation system, packing houses,
and among numerous other improvements are permanently in place and not just a measly, but
substantial amounts investments have been infused. To exclude these permanent improvements in
rendering its valuation of said properties would certainly be less than fair. x x x.

xxxx

The plaintiffs’ agricultural properties are just a stone’s throw from the residential and/or industrial
sections of Tagum City, a fact defendants-DAR and LBP should never ignore. The market value of
the property (plus the consequential damages less consequential benefits) is determined by such
factors as the value of like properties, its actual or potential use, its size, shape and location as
enunciated in B.H. Berkenkotter & Co. vs. Court of Appeals, 216 SCRA 584 (1992). To follow
Defendants-DAR and LBP logic, therefore, would in effect restrict and delimit the broad judicial
prerogatives of this Court in determining and fixing just compensation of properties taken by the
State.

Proceedings before the Panel of Commissioners revealed that permanent improvements as

mentioned above exist inside the lands subject of this complaints. It was also established during the
trial proper upon reception of the evidence of the plaintiffs which clearly revealed the character, use
and valuation of the lands surrounding the properties involved in these cases, indicating the strategic
location of the properties subject of these cases. The findings being that surrounding properties have
been classified as residential, commercial or industrial. And yet defendant-LBP refused to
acknowledge the factual basis of the findings of the Panel of Commissioners and insisted on its
guideline in determining just compensation. x x x.74

In arriving at its valuation of the subject properties, the RTC conducted a thorough and meticulous
examination of all determining factors. It did not rely merely on the report of Commissioners nor on
the Cuervo appraiser’s report. It took into consideration the schedule of market values of the City of
Tagum per its 1993 and 1994 Revision of Assessment and Property Clasisification, value of the
permanent improvements thereon, as well as comparative sales of adjacent lands from early 1995 to
early 1997, among other factors.

Contrary to LBP’s claim, the above factors are neither irrelevant nor immaterial. When the trial court
arrived at the valuation of a landowner’s property taking into account its nature as irrigated land,
location along the highway, market value, assessor’s value and the volume and value of its produce,
such valuation is considered in accordance with Republic Act No. 6657.75
Even the Commissioners’ report which the trial court took into consideration may not be dismissed
as irrelevant. In the first place the trial court acting as a special agrarian court is authorized to
appoint commissioners to assist in the determination of just compensation.76 In this case the
Commissioners’ report was submitted only after ocular inspections were conducted on the
landholdings to give them a better idea of their real value.77

Conspicuously, the trial court did not merely rely solely on the appraisal report submitted by the
Commissioners. The trial court conducted hearings for the purpose of receiving the parties’
evidence.

Clearly evident from the records of this case is that in the proceedings before the Commission
constituted by the RTC of Tagum City, Branch 2, to fix the just compensation for the properties, the
LBP and the DAR were given all the opportunities to justify their stances. Thus:

[T]he Commission set another hearing on February 23, 2001 at 9:00 a.m. at the Function Room,
Marbella mansion, Rizal Street, Davao City, to give the LBP the opportunity to present evidence.
The LBP counsels, Attys. Batingana and Sembrano, instead of presenting witnesses and other
evidence, manifested that they will submit a position paper within fifteen (15) days from the date of
the hearing. This was granted by the Chairman of the Commission, who also gave the plaintiff the
opportunity to submit within five (5) days, if they so desire, their rejoinder.

Inspite of the lapse of the period, the LBP failed to file its position paper.

xxxx

The plaintiffs have presented evidence to establish the value of their properties before the Court-
appointed Commissioners, as well as before this Court. The Commissioners who acted and
performed their assigned tasks under their Oaths of Office are deemed a surrogate or extension of
the Court itself. (Secs. 3 and 4, Rule 32 of the 1997 Rules of Civil Procedure). Defendant-DAR and
Defendant-LBP failed to present evidence during the hearings set by the Commissioners on
February 5, 2001, and February 23, 2001, for the presentation of their evidence. This Court gave
Defendant Land Bank and Defendant DAR additional opportunities to present evidence. Defendant
Land Bank and DAR asked for extensions to submit their evidence in its motion dated July 27, 2001,
which was granted by the Court. All exhibits and other documents offered in evidence were
admitted, after which this Court issued an order that these two cases were submitted for resolution.78

Given the already exhaustive analysis made by the RTC, this Court is convinced that the trial court
correctly determined the amount of just compensation due to AFC and HPI.

WHEREFORE, premises considered, the instant Petition is PARTIALLY GRANTED. While the
Decision, dated 12 February 2004, and Resolution, dated 21 June 2004, of the Court of Appeals in
CA-G.R. SP No. 76222, giving due course to LBP’s appeal, are hereby AFFIRMED, this Court,
nonetheless, RESOLVES, in consideration of public interest, the speedy administration of justice,
and the peculiar circumstances of the case, to give DUE COURSE to the present Petition and
decide the same on its merits. Thus, the Decision, dated 25 September 2001, as modified by the
Decision, dated 5 December 2001, of the Regional Trial Court of Tagum City, Branch 2, in Agrarian
Cases No. 54-2000 and No. 55-2000 is AFFIRMED. No costs.

SO ORDERED.