G.R. No. 170506 - Land Bank of the Philippines vs. Heirs of Tanada

Respondents, the Heirs of Lorenzo Taaada and Expedita Ebarle, are the registered owners of several parcels of land in Gabon, Abucay, Bataan, identified by TCT Nos. T-8483 (56.8564 hectares) and T-12610 (16.9268 hectares).
The properties were included in the government’s land reform program in 1988, with specific areas (16.7692 hectares from TCT No. T-8483 and 13 hectares from TCT No. T-12610) subject to acquisition.
Petitioner Land Bank of the Philippines (LBP), exercising its mandate under Executive Order No. 405, initially valued the properties at P223,837.29 for 16.7692 hectares and P192,610.16 for 13 hectares—a total of P416,447.43.
Disagreeing with this valuation as unreasonably low, respondents initiated summary administrative proceedings with DARAB (DARAB Cases: 068-B'92 and 103-BT'93) in 1992 and 1993, which affirmed petitioner’s valuation.
Subsequent to DARAB’s affirmation, respondents filed separate petitions for just compensation in Civil Case Nos. 6328 and 6353 before the RTC of Bataan, Branch I, consolidating the valuation dispute.

Respondents presented the testimony of Jose Dela Cruz, a vault keeper at the Bataan Register of Deeds, who testified regarding:

A Deed of Sale dated April 5, 1997 involving the sale of 6,158 square meters for P20,000.00 (P3.24 per square meter).
A Deed of Absolute Sale dated August 27, 1996 involving 53,102 square meters sold for P830,000.00 (P15.91 per square meter).

Petitioner and the DAR did not produce testimonies to contradict respondents’ evidence; instead, they relied on documentary exhibits and adherence to DAR Administrative Order No. 6, Series of 1992 for determining compensation.

The Special Agrarian Court (SAC) of the RTC of Bataan, Branch I, rendered a decision on July 13, 1999, awarding just compensation at P150,000.00 per hectare (or P15.00 per square meter) in favor of the respondents.
A subsequent motion for reconsideration by petitioner was denied by the trial court in its August 7, 2003 Order.
The Court of Appeals affirmed the trial court’s decision in its April 8, 2005 ruling and denied petitioner’s motion for reconsideration in its November 22, 2005 Resolution.
Petitioner elevated the case via a petition for review under Rule 45, questioning the method used by the SAC and the reliance on valuation formulas under DAR Administrative Order No. 6, Series of 1992.

Whether the trial court, acting as a Special Agrarian Court, correctly applied the valuation factors under Section 17 of Republic Act No. 6657 in determining the just compensation for the petitioners’ properties.
Whether the trial court was warranted in deviating from the mandatory formula prescribed in DAR Administrative Orders (specifically DAR AO No. 6, Series of 1992), in reaching its valuation.
Whether the petitioner’s own valuation method, based on the DAR formula, should supplant the SAC’s valuation fixed at P150,000.00 per hectare.
Whether the substantial reliance on comparable sales and market value, without full consideration of all factors under Section 17 of RA 6657, deprived the respondents of their rightful just compensation.