G.R. No. 208865 - Land Bank of the Philippines vs. Garcia

Petitioner: Land Bank of the Philippines, a government banking and financial institution involved in agrarian reform.
Respondent: Jose Cuenca Garcia, registered owner of a 10.999-hectare rice land in Ajuy, Iloilo.
The dispute arose from the acquisition of Garcia’s land by the government under the Comprehensive Agrarian Reform Program (CARP).

In November 1998, the Department of Agrarian Reform (DAR) issued a notice (Memorandum of Valuation Claim Folder Profile and Valuation Summary) to Garcia.
The notice informed Garcia of the government’s intent to acquire his land, offering compensation priced at roughly P5.58 per square meter, totaling approximately P647,508.49.
Garcia rejected the offer believing the valuation significantly undervalued his property.

Following Garcia’s rejection, the DAR Adjudication Board – Region VI conducted a preliminary determination of just compensation and ultimately affirmed Land Bank’s original appraisal.
Garcia, aggrieved by the offered compensation, filed a petition for fixing of just compensation before the Regional Trial Court, which acted as a Special Agrarian Court.
The parties stipulated several relevant facts, including:

Garcia’s sale of an adjacent 5.898-hectare lot at P50.00 per square meter.
The location of the subject property, noting its strategic position along a national highway with long frontage and proximity to the sea.
The existence of buildings and improvements on the property that potentially add to its market value.

Garcia maintained that the government’s initial evaluation was unreasonably low, citing recent transactions (sales in 1997) that valued an adjacent lot at considerably higher rates (P50.00 per square meter or P500,000 per hectare).
Land Bank defended its original computation which used three comparable sales transactions from 1987–1988, along with other valuation methods such as Capitalized Net Income (CNI) and Market Value per Tax Declaration (MVTD) following DAR Administrative Order No. 05-98.
The trial court, however, modified the computation by accepting the more recent and comparable sales data submitted by Garcia and considering the strategic location of the land.
The revised computation produced a just compensation of P2,196,367.40 for the 10.999 hectares.

Land Bank, on appeal, argued that the trial court erred in departing from the strict parameters of the DAR formula and in considering additional factors (such as location and potential use) not provided for under Section 17 of Republic Act No. 6657.
Garcia contended procedural infirmity regarding the mode and timing of Land Bank’s appeal, asserting that the petition was belatedly filed and thus should be dismissed.
The Court of Appeals affirmed the trial court’s decision, noting:

The more recent sales data (from 1997) were more reflective of the market conditions at the time of taking (1998).
The slight discrepancy in computed compensation between the trial court and appellate court (a difference of P234.64) was negligible.

Ultimately, Land Bank filed a Petition for Review on Certiorari with this Court, challenging both the procedural basis and the methodology used to determine just compensation.

Whether the decision of the trial court had already attained finality given the delayed filing of Land Bank’s appeal via Rule 42 instead of the appropriate Rule 41.
Whether the tardy motion for reconsideration (filed on October 16, 2009, instead of within the 15-day period from receipt of the decision on September 11, 2009) rendered the appeal procedurally infirm.

Whether the lower courts erred in departing from the strict parameters set forth in DAR Administrative Order No. 05-98 by:

Accepting and using sales transactions from 1997 instead of strictly using transactions from January 1, 1985 to June 15, 1988.
Including factors beyond the formula, such as the strategic location of the property, long frontage, adjoining national highway, and proximity to high-valued residential areas.

Whether the additional factors considered by the trial court (and later affirmed by the Court of Appeals) properly contributed to arriving at a more accurate and just valuation of the land.

Whether the judicial determination of just compensation, as exercised by the Special Agrarian Court, appropriately overrides or deviates from the preliminary valuations provided by the DAR.
How the distinction between the administrative role of the DAR and the judicial function vested in the Special Agrarian Courts affects the finality and correctness of the compensation awarded.