CASE DIGEST
Development Bank of the
Philippines v. Land Bank of the Philippines
G.R. Nos. 229274 &
229289, [June 16, 2021]
SECOND, LOPEZ, M.V
Eminent Domain; Determination of Just Compensation is a judicial function
The determination of just compensation
in cases involving the Comprehensive Agrarian Reform Program (CARP) is a
judicial function vested in the Regional Trial Court (RTC) acting as a Special
Agrarian Court (SAC). The court, in exercising this function, must consider the
factors enumerated under Section 17 of Republic Act No. 6657 (CARP Law) and the
guidelines and formulas set forth in the Department of Agrarian Reform
Administrative Order No. 5, series of 1998 (DAR AO No. 5-98), but it is not
strictly bound by the determinations of the administrative agencies.
The case involves a parcel of land in
Barangay Duhat, Bocaue, Bulacan, registered in the name of the Development Bank
of the Philippines (DBP) under Transfer Certificate of Title (TCT) No. T-144547
with an area of 2,225 square meters. Originally owned by Spouses Angel Armando
and Remedios Martin, the property was mortgaged to DBP in 1979, amounting to
P400,000.00. After defaulting on payments, the property was foreclosed in 1990,
and DBP acquired it in 1992 due to Spouses Angel and Remedios' failure to redeem.
In 1998, a 1,567-sq.m. portion was placed under the Comprehensive Agrarian
Reform Program (CARP). Land Bank of the Philippines (LBP) valued the property,
leading to a dispute with DBP over the just compensation amount. The Regional
Trial Court's (RTC) and CA’s valuation, fixing the just compensation for DBP's
property at P18.85/sqm or a total of P29,544.01 plus legal interest. DBP do not
agree to the amount of just compensation, hence this petition.
Whether RTC and CA’s valuation of just
compensation was correct.
The Supreme Court (SC) partly granted DBP's
petition, denying LBP's petition. The SC reversed the CA's decision and
remanded Civil Case No. 368-M-2008 to the RTC for the proper determination of
just compensation. The RTC and CA were faulted for solely relying on LBP's
valuation, not considering factors under Section 17 of RA No. 6657, and failing
to verify the accuracy of LBP's figures. The SC emphasized that the court must
make an independent determination, considering all evidence and guidelines
under DAR AO No. 5-98 while not being strictly bound by it. While the court
should take into account the standards provided by law and administrative
issuances, it is not strictly bound by them. The court has the authority to
deviate from the formula if warranted by the circumstances of the case,
provided that it explains such deviation.
The court highlighted the need for evidence
verification and proper consideration of prevailing values at the time of
taking. The court should not merely rely on administrative valuations but
should critically examine the data and numbers to arrive at a fair and just
compensation amount. Interest may be awarded based on the circumstances, and
the court has the discretion to impose legal interest on the amount of just
compensation in case of delay in payment. Case is remanded to RTC to follow in
the reassessment of just compensation.
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