G.R. No. 177404 - Land Bank of the Philippines vs. Kumassie Plantation Co., Inc.

The case involves consolidated petitions between the Land Bank of the Philippines (LBP) and Kumassie Plantation Company Incorporated (KPCI).
LBP, as petitioner in one case, and KPCI as petitioner in the other, are in dispute over the valuation and compensation of a compulsory land acquisition.

The subject property is a 457-hectare landholding located in Basiawan, Santa Maria, Davao del Sur.
The land was planted to coconuts and cacao, which are essential to its overall productivity.

The valuation of the land initially computed by the Regional Trial Court (RTC) set the value at P100,000.00 per hectare.
LBP submitted its own valuation at P41,792.94 per hectare, computed according to the guidelines provided by Section 17 of Republic Act No. 6657 and the formula in DAR Administrative Order (DAO) No. 6, Series of 1992 (as amended by DAO No. 11, Series of 1994).
The lower valuation by LBP was approved because both the RTC and the Court of Appeals failed to apply the mandatory factors and the correct formula.

Previous decisions by the RTC and the Court of Appeals, which had favored the RTC’s higher valuation, were reversed.
The Supreme Court approved the LBP valuation in its dispositive part, declaring the amount paid as just compensation for the acquisition.
KPCI later filed a Motion for Reconsideration and a Supplement to the Motion seeking a reversal of the decision.

KPCI contended that the DAR valuation formula should not bind the courts, arguing that the determination of just compensation is primarily a judicial function.
It further asserted that LBP erred by excluding the cacao production data from the computation of the Capitalized Net Income (CNI), which is essential in determining land value.
KPCI also argued that it was due additional compensation for the cacao trees on the land, claiming these trees belong to it under the lease with the Philippine Cocoa Estates Corporation (PCEC).

Whether the courts are compelled to use the mandatory DAR valuation formula (as provided in DAO No. 6, Series of 1992, and its amendments) in computing just compensation for lands acquired under agrarian reform.

Whether LBP erred in excluding income data from cacao production in arriving at the Capitalized Net Income (CNI) and, consequently, the valuation.
Whether the absence of production data could justify the omission or if alternative industry data sources should have been used.

Whether KPCI is entitled to compensation for the cacao trees planted on the land, especially when these trees were introduced and maintained by its lessee, PCEC.
Whether the resolution of the entitlement involving the cacao trees falls within the jurisdiction of the Special Agrarian Court.