G.R. No. 217380 - People vs. Cuesta y Astorga

Honeycomb Farms Corporation (HFC) was registered owner of a 29.0966-hectare agricultural land in Curvada, Caintagan, Masbate under TCT No. T-2550.
On February 5, 1988, HFC voluntarily offered the land to the Department of Agrarian Reform (DAR) for coverage under RA 6657 (Comprehensive Agrarian Reform Law of 1988), at P20,000.00 per hectare, totaling P581,932.00.

The government, through DAR and Land Bank of the Philippines (LBP), determined an “acquirable and compensable area” of 27.5871 hectares; 1.5095 hectares were excluded as hilly and underdeveloped.
Using DAR Administrative Order No. 6 (1992), amended by DAR AO No. 11 (1994), LBP fixed valuation at P165,739.44 and issued a Notice of Valuation to HFC.

HFC rejected LBP’s valuation, claiming just compensation should be P25,000.00 per hectare, totaling P725,000.00.
HFC filed a petition on January 15, 1996, with the DAR Adjudication Board (DARAB) for summary administrative determination of just compensation.
While DARAB proceedings were pending, HFC filed a Complaint for Determination and Payment of Just Compensation with the Regional Trial Court (RTC) acting as Special Agrarian Court (SAC), seeking P725,000.00 plus 10% attorney’s fees.
HFC justified direct filing with SAC due to alleged unreasonable delay and official inaction by DARAB, citing Section 16 of RA 6657 which mandates decision within 30 days.

LBP argued that HFC’s complaint was premature and lacked cause for failure to exhaust administrative remedies.
On May 14, 1998, DARAB issued a Decision affirming LBP’s valuation of P165,739.44 and dismissed HFC’s petition for lack of jurisdiction.

On July 27, 2000, RTC ruled in favor of HFC, fixing just compensation at P32,000.00 per hectare for the 27.5871 hectares, amounting to P882,787.20.
The RTC added consequential damages equivalent to the same rate for the 1.5095 hectares excluded by the government, totaling P931,109.20.
RTC awarded 10% attorney’s fees on the just compensation amount.
RTC took judicial notice of the land’s location near a commercial district and its partly undeveloped condition to justify valuation.

Both parties appealed: HFC argued RTC undervalued land; LBP questioned jurisdiction, judicial notice, and award of damages and fees.
On January 28, 2004, CA reversed RTC and dismissed HFC’s complaint for failure to exhaust administrative remedies under Section 16(f) of RA 6657.
On motion for reconsideration with DARAB Decision attached, CA on September 16, 2004, recalled its dismissal, reinstated RTC decision with modification deleting attorney’s fees award.
CA upheld RTC’s valuation based on evidence such as sketch plan, witness testimonies, and field reports.
LBP petitioned the Supreme Court, challenging CA’s reinstatement and failure to dismiss for non-exhaustion and forum shopping, and contending that the DAR formula for valuation was not applied.

Whether the RTC acting as SAC had jurisdiction to hear HFC’s complaint despite pending DARAB proceedings.

Whether HFC prematurely filed the complaint with SAC without exhausting administrative remedies.
Whether HFC committed forum shopping.

Whether the valuation method applied by RTC and CA, including taking judicial notice of the land’s location and condition, was proper.
Whether the SAC was required to apply the DAR’s prescribed formula (DAR AO No. 6, series of 1992, as amended) in determining just compensation.