G.R. No. 244213 - Land Bank of the Philippines vs. De Jesus-Macaraeg

Milagros De Jesus-Macaraeg is the registered owner of a 15.1836-hectare parcel of land in Cawayan, Calinan, Davao City, as evidenced by Transfer Certificate of Title (TCT) No. T-77552.
Land Bank of the Philippines is the petitioner in the case, contesting the valuation and payment of just compensation for the subject property.

In 2002, 7.1838 hectares of the subject land were subjected to CARP pursuant to Republic Act No. 6657.
Under this program, the Department of Agrarian Reform (DAR) and Land Bank initially valued the property at P65,756.61 per hectare, amounting to a total of P472,382.33, based on the basic formula set out in DAR Administrative Order No. 5 (DAR AO5).

After Milagros rejected Land Bank’s initial offer, Land Bank deposited the offered amount under Milagros’ name.
An administrative proceeding was conducted before the DAR Adjudication Board (DARAB) where, in a Resolution dated February 19, 2003, the property was valued at P1,280,099.20.
Land Bank’s motion for reconsideration before DARAB was denied.
The case subsequently moved to the Regional Trial Court-Branch 15, Davao City sitting as a Special Agrarian Court (RTC-SAC) under Civil Case No. 29, 824-2003.
Notably, Land Bank failed to appear during the evidence presentation, while Milagros presented her own valuation of P3,055,000.00, supported by testimony from Ramon Macaraeg, who produced figures based on pineapple production, despite his connection as Milagros’ husband.

On February 21, 2005, the RTC-SAC fixed just compensation at P20.00 per square meter and awarded attorney’s fees of P100,000.00; a motion for reconsideration by Land Bank was again denied on May 9, 2005.
On appeal via CA-G.R. SP No. 00349-MIN, the Court of Appeals remanded the case back to the RTC-SAC for a proper computation of just compensation and deleted the attorney’s fees award.
In the subsequent proceedings, Land Bank recomputed the valuation using data from the Bureau of Agricultural Statistics (BAS) and proposed a revised just compensation of P777,880.40 based on an Annual Gross Production (AGP) of 8,901.28 kilos per hectare and a selling price (SP) of P7.96 per kilo.

The RTC-SAC, in its Decision dated August 26, 2014, ordered the payment of P2,765,727.08 as just compensation with twelve percent (12%) legal interest per annum, using an AGP of 46,666 kilos per hectare and an SP of P5.00 per kilo.
The Court of Appeals, in its Decision dated February 15, 2018, reversed the RTC-SAC’s figures by reducing the SP to P2.50 per kilo but affirmed the use of 46,666 kilos per hectare as the AGP, anchoring its computation to Land Bank’s initial figures while adjusting the market value and interest rate.
Land Bank’s subsequent petition questioned the use of the unverified AGP value, arguing instead for the BAS-provided figure of 8,901.28 kilos per hectare and the corresponding SP of P7.96 per kilo.
Additionally, Land Bank contended that it should not be charged legal interest given its timely deposit of the initial valuation, while Milagros defended the award by underscoring a seventeen-year delay in receiving just compensation.

The Court reviewed the conflicting factual findings between the RTC-SAC and the Court of Appeals, particularly emphasizing that the RTC-SAC holds exclusive jurisdiction to determine just compensation.
The valuation was recomputed using the formula provided in DAR AO5, specifically:

CNI = (AGP x SP) – CO factor (with an assumed net income rate when CO is unverified)
Land Valuation = (CNI x 0.9) + (Market Value x 0.1)

Using the verified figures from BAS (AGP = 8,901.28 kilos per hectare, SP = P7.96 per kilo, and a market value of P20,012.96 per hectare), the recomputation resulted in a total land value of P777,880.40.
The award of legal interest was deemed proper, with an imposition of 12% per annum from March 3, 2003 until June 30, 2013, and subsequently 6% per annum until the full payment.

Whether the AGP for the purpose of computing just compensation should be based on the unverified figure of 46,666 kilos per hectare as submitted by Milagros’ husband or the BAS-verified figure of 8,901.28 kilos per hectare.
The implications of choosing one figure over the other on the overall computation of the Capitalized Net Income (CNI).

Whether the computation of the CNI should adhere strictly to the formula set forth under DAR AO5 using the appropriate figures for AGP and SP.
The determination of the applicable selling price (SP) – whether it should be P5.00, P2.50, or the later admitted figure of P7.96 per kilo.

The appropriateness of imposing legal interest on the balance of just compensation.
The determination of the correct interest rate to apply over different time intervals in view of the long delay in payment.

The issue of whether the Court should review the factual findings of the lower tribunals given the evident discrepancies in the factual determinations regarding production data and valuation parameters.
The application of Rule 45 of the Rules of Court concerning the re-examination of evidence and factual determinations in cases involving eminent domain.