Title
Supreme Court
Land Bank of the Philippines vs. Spouses Orilla
Case
G.R. No. 194168
Decision Date
Feb 13, 2013
Landowners challenged DAR's land valuation; SAC's compensation ruling annulled for lack of basis, remanded for recomputation. Initial payment released, excess returnable if recomputed amount is lower.

Case Digest (G.R. No. 194168)
Expanded Legal Reasoning Model

Facts:

  • Parties and Subject Matter
    • The respondents, spouses Placido and Clara Orilla, are the registered owners of a parcel of land in Bohol identified as Lot No. 1, 11-12706, covering an area of 23.3416 hectares and evidenced by Transfer Certificate of Title No. 18401.
    • The petitioner, Land Bank of the Philippines (LBP), is engaged in proceedings regarding the compulsory acquisition of 21.1289 hectares of the respondents’ land under the Comprehensive Agrarian Reform Law (Republic Act No. 6657).
  • Notification and Initial Valuation
    • In November 1996, the Department of Agrarian Reform Provincial Agrarian Reform Office (DAR-PARO) of Bohol issued a Notice of Land Valuation and Acquisition to the respondents on November 15, 1996.
    • The notice informed the respondents of the compulsory acquisition for a compensation amount of P371,154.99, which was based on a valuation submitted by petitioner LBP.
    • The respondents rejected the valuation provided by petitioner, setting the stage for subsequent proceedings.
  • Proceedings Before the Special Agrarian Court (SAC)
    • A summary hearing was conducted by the Provincial DAR Adjudication Board (DARAB), which affirmed the valuation made by petitioner LBP.
    • Dissatisfied with that outcome, the respondents initiated an action for the determination of just compensation before the Regional Trial Court of Tagbilaran City sitting as a Special Agrarian Court (SAC), and the case was docketed as Civil Case No. 6085.
    • On November 20, 2000, after trial on the merits, the SAC rendered a decision fixing the just compensation at P7.00 per square meter—equating to a total of P1,479,023.00—and ordered the respondents to indemnify petitioners for appraisal expenses.
  • Appeals, Motions, and Execution Pending Appeal
    • Petitioner LBP filed a Notice of Appeal on December 11, 2000, following the SAC decision.
    • On December 15, 2000, the respondents filed a Motion for Execution Pending Appeal pursuant to the Rules of Civil Procedure, seeking immediate payment of the awarded compensation.
    • On December 21, 2000, the SAC issued an Order granting the motion, directing petitioner LBP to post a bond amounting to one-half of what was due, and mandating the deposit of the compensation amount.
    • Subsequent motions for partial reconsideration filed by the respondents (December 25, 2000) and for reconsideration by the petitioner (December 29, 2000) were both denied.
    • On March 13, 2001, petitioner LBP initiated a special civil action for certiorari and prohibition challenging the propriety of the execution pending appeal order.
    • The Court of Appeals (CA) dismissed the petitioner’s special civil action in a decision dated July 29, 2002, holding that the execution order was consistent with justice and the prompt payment principle.
    • The Supreme Court affirmed the CA’s ruling in G.R. No. 157206 on June 27, 2008.
    • In a later development, the CA, in its Decision dated April 17, 2009, set aside the SAC’s valuation of P1,479,023.00 for lack of legal and sufficient basis and remanded the case to the trial court for a proper determination of just compensation.
    • Petitioner LBP then filed a Motion for Partial Reconsideration, arguing that once the SAC decision was annulled and set aside, its valuation could no longer be subject to execution. This motion was denied by the CA Resolution dated September 30, 2010, which emphasized the finality of the previously executed writ pending appeal.
  • Final Monetary Considerations
    • The CA expressly held that if, upon recomputation, the just compensation determined by the SAC (now void) turns out to be higher than the recomputed value, any excess amount previously paid by LBP must be returned to the petitioner.
    • The CA maintained that despite the annulment of the SAC’s valuation, the compensation originally offered by petitioner (P371,154.99) may still be released to the respondents, pending the outcome of the trial court’s recomputation.

Issues:

  • Validity of the SAC Valuation
    • Whether the decision of the SAC fixing the just compensation at P7.00 per square meter (totaling P1,479,023.00) was based on a sufficient legal and evidentiary basis.
    • Whether the lack of a proper computation or explanation in the SAC decision undermined its validity.
  • Enforceability of the Execution Pending Appeal Order
    • Whether the writ of execution issued by the SAC remains valid after the SAC’s valuation was subsequently annulled and set aside by the CA.
    • Whether a void judgment or order can serve as a basis for the enforcement of an execution pending appeal.
  • Effect of Finality on the Writ of Execution
    • Whether the prior finality granted to the execution pending appeal should preclude its challenge once the SAC’s underlying valuation is declared void.
    • How judicial finality interacts with subsequent annulment of a judgment in enforcement proceedings.
  • Restitution and Recalculation Issues
    • Whether respondents should be required to return any excess amount received if the trial court, on recomputation, determines a higher just compensation than that fixed by the void SAC decision.
    • The appropriate method for addressing the discrepancy between the executed order and the recomputed valuation.

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

Doctrine:

  • (Subscriber-Only)
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