Republic of the Philippines certification4 dated October 31, 1995 of Zoning Administrator Delia O.
SUPREME COURT Malaluan.
Manila
THIRD DIVISION
G.R. No. 180471 March 26, 2010
ALANGILAN REALTY & DEVELOPMENT CORPORATION, Petitioner,
vs.
OFFICE OF THE PRESIDENT, represented by ALBERTO ROMULO, as
Executive Secretary, and ARTHUR P. AUTEA, as Deputy Secretary;
and DEPARTMENT OF AGRARIAN REFORM, Respondents.
DECISION
NACHURA, J.:
At bar is a petition for review on certiorari under Rule 45 of the Rules of
Court filed by Alangilan Realty & Development Corporation (petitioner),
challenging the August 28, 2007 Decision1 and the November 12, 2007
Resolution2 of the Court of Appeals (CA) in CA-G.R. SP No. 76525.
Petitioner is the owner/developer of a 17.4892-hectare land in Barangays
Alangilan and Patay in Batangas City (Alangilan landholding). On August 7,
1996, petitioner filed an Application and/or Petition for Exclusion/Exemption
from Comprehensive Agrarian Reform Program (CARP) Coverage3 of the
Alangilan landholding with the Municipal Agrarian Reform Office (MARO) of
the Department of Agrarian Reform (DAR). It averred that, in 1982, the
Sangguniang Bayan of Batangas City classified the subject landholding as
reserved for residential under a zoning ordinance (1982 Ordinance), which
was approved by the Human Settlement Regulatory Commission. It further
alleged that, on May 17, 1994, the Sangguniang Panglungsod of Batangas
City approved the City Zoning Map and Batangas Comprehensive Zoning
and Land Use Ordinance (1994 Ordinance), reclassifying the landholding as
residential-1. Petitioner thus claimed exemption of its landholding from the
coverage of the CARP. In support of its application, petitioner submitted a
On May 6, 1997, then DAR Secretary Ernesto Garilao issued an
Order5 denying petitioners application for exemption. The DAR Secretary
noted that, as of February 15, 1993, the Alangilan landholding remained
agricultural, reserved for residential. It was classified as residential-1 only on
December 12, 1994 under Sangguniang Panlalawigan Resolution No. 709,
series of 1994. Clearly, the subject landholding was still agricultural at the
time of the effectivity of Republic Act No. 6657, or the Comprehensive
Agrarian Reform Law (CARL), on June 15, 1988. The qualifying phrase
reserved for residential means that the property is still classified as
agricultural, and is covered by the CARP.
The DAR Secretary disposed thus:
WHEREFORE, premises considered, the herein application for exemption
involving seventeen (17) parcels of land with an aggregate area of 23.9258
hectares located [in] Calicanto, Alangilan and Patay, Batangas City is
hereby GRANTED insofar as the 4.9123 hectares [of] Calicanto
landholdings are concerned and DENIED with respect to the 17.4892
Alangilan properties, subject to the payment of disturbance compensation to
qualified tenants, if any there be.
SO ORDERED.6
Petitioner moved for reconsideration of the Order, arguing that the Alangilan
landholding was already reserved for residential use as early as October 6,
1982. Invoking this Courts ruling in Natalia Realty, Inc. v. Department of
Agrarian Reform,7 petitioner insisted that the subject landholding was
outside the coverage of the CARP. Petitioner also submitted a
Supplemental to Motion for Reconsideration,8 arguing that the landholding
had already been reclassified as reserved for residential and had been
earmarked for residential use even before the effectivity of the CARL.
Accordingly, its non-development into a subdivision did not remove the
landholdings zoning classification as reserved for residential.
On July 8, 1997, petitioner submitted an Addendum to Supplemental to
Motion for Reconsideration,9 attaching another certification stating that the
Alangilan landholding was zoned as reserved for residential in 1982, and
became residential-1 in 1994. In a 2nd Addendum to Supplemental to
Motion for Reconsideration,10 petitioner submitted another certification
whereby the zoning administrator withdrew her first certification and clarified
that the phrase agricultural, reserved for residential spoke of two
classifications, namely, agricultural (coded brown in the map) and reserved
for residential (coded brown with diagonal lines), stating further that the
Alangilan landholding was reserved for residential.
However, the DAR Secretary was not at all persuaded, and denied
petitioners motion for reconsideration on December 21, 1998, viz.:
After a careful review and evaluation of the case, this Office finds no cogent
reason to reverse its Order, dated 6 May 1997.
Administrative Order No. 6, series of 1994 provides that "lands that are
classified as commercial, industrial or residential before 15 June 1988 no
longer need any conversion clearance"; as such, they are exempt from the
coverage of R.A. [No.] 6657.
The phrase "Reserved for Residential" is not a zoning classification
contemplated in the aforestated A.O. as to exempt a particular land from the
coverage of R.A. 6657. Moreso in this case, because the phrase was
attached to the word "Agricultural"; in fact, we can say that it merely
qualified the term "Agricultural." We believe that the correct interpretation of
the zoning should be that the land is agricultural, but it may be classified
and used for residential purposes in some future time, precisely, because it
has been reserved for residential use. This interpretation is supported by the
fact that the zoning of the land became Residential only in 1994, per
Ordinance No. 3, series of 1994, which established a Comprehensive
Zoning Regulation and Land Use for Batangas City. To reiterate, the
Sanggunian Members of Batangas City would have expressly,
unequivocably, and unqualifiedly zoned the area as "residential" if they had
intended it to be zoned as such in 1982. They never did until the issuance of
Ordinance No. 3 in 1994.
It is also important to note, that the legend used in the Zoning Map of
Batangas City approved by HSRC (now HLURB) per Resolution No. 92,
dated 6 October 1982, indicated a certain kind of arrangement which put in
sequential order those that were similarly zoned, but with different
qualifications and/or characteristics. Thus, "residential-1," "residential-2,"
and "residential-3" were placed on top of the list one after the other, while
"Agricultural, reserved for residential" and mining agricultural were put at the
bottom, but also enumerated one after the other. If the subject properties
were classified more of residential than agricultural, it should have been
placed in the legend right after "residential-3", and the color that should
have been used was not brown but a shade of white with diagonal lines to
reflect its dominant residential character.
Even the Applicant was aware that the classification of the area was
agricultural. In his letter to the MARO of Batangas City, dated 24 October
1995, the Applicant categorically admitted that the Alangilan Landholding
was classified as agricultural. The said letter stated as follows:
At present, the subject properties are classified as agricultural. However,
Barangay Alangilan where these properties are located have been declared
by an ordinance of the Municipal Council of Batangas City as commercial,
industrial and/or residential.
As to what ordinance the Applicant was referring to was not specified.
However, it seems obvious that he was referring to the 1994
Comprehensive Zoning Regulations and Land Use for Batangas City
(Ordinance No. 3, series of 1994). The previous zoning ordinance, i.e. the
Batangas City Zoning Ordinance approved under HSRC Resolution No. R-
92, series of 1982, dated 6 October 1982, classified the said landholding as
"Agricultural, Reserved for Residential." It was Ordinance No. 3, series of
1994 that explicitly classified the area as "Residential-1."
This Office, therefore, is convinced that the zoning classification of the
Alangilan Landholding prior to 15 June 1988 was Agricultural, although with
the qualification that it had been reserved for residential use. The ocular
inspection conducted in 1996 by the representatives of the MARO, PARO
and RARO confirmed that the Alangilan Landholding was still used for
agricultural purposes. The area was planted with mangoes and coconuts.
We could not give credence to the 3rd Certification, dated 9 December
1997, of Zoning Administrator Delia Malaluan-Licarte, because it does not
conform to the Batangas City Zoning Ordinance and Map approved under
HSRC Resolution No. R-92, series of 1982, dated 6 October 1982. In the
first place, what is asked from Zoning Administrators is merely to state the
kind of classification/zoning where a certain area falls as provided in the
approved Zoning Ordinance. In the case at bar, the Zoning Administrator
went beyond her authority. In effect, she reclassified the area from
"Agricultural, Reserved for Residential" to "Reserved for Residential" by
claiming that there were actually two zones provided by the Sanggunian
Members. It was actually a modification of the zoning ordinance which, to
us, is clearly unwarranted.
Moreover, even assuming the Zoning Administrator is correct, the
classification "Reserved for Residential" is not within the contemplation of
A.O. No. 6, series of 1994. The said A.O. talks about lands that were
classified as residential before 15 June 1988. Alangilan Landholding was
merely reserved for Residential. It connotes something in the future, which
is, that the land may be classified as residential in some future time. It was
identified as an expansion area, nothing else. The fact remains that in 1982,
the landholding was still Agricultural, and this fact is not changed by the re-
interpretation made by Zoning Administrator Delia Malaluan-Licarte.11
On appeal, the Office of the President (OP) affirmed the decision of the
DAR Secretary:
WHEREFORE, premises considered, the instant appeal is hereby
DISMISSED and the appealed Order dated 21 December 1998 of the
Department of Agrarian Reform [is] AFFIRMED in toto.
Parties are required to INFORM this Office, within five (5) days from notice,
of the dates of their receipt of this Decision.
SO ORDERED.12
A motion for reconsideration was filed, but the motion also suffered the
same fate, as the OP denied it on March 20, 2003.13
Petitioner went up to the CA via a petition for review on certiorari, assailing
the OP decision. On August 28, 2007, the CA dismissed the petition. The
CA noted the report of MARO, Provincial Agrarian Reform Office (PARO),
and Regional Agrarian Reform Office (RARO) that the Alangilan landholding
was devoted to agricultural activities prior to the effectivity of the CARP on
June 15, 1988 and even thereafter. Likewise, there was no showing that it
was classified as commercial, industrial, or residential in town plans and
zoning ordinances of the Housing and Land Use Regulatory Board.
Accordingly, the Alangilan property did not cease to be agricultural. The
1994 Ordinance classifying the property as residential-1 did not convert or
reclassify the Alangilan landholding as residential because there was no
proof that a conversion clearance from the DAR was obtained. Thus,
despite its reclassification in 1994 by the City Government of Batangas, the
Alangilan landholding remained under CARP coverage. Petitioner filed a
motion for reconsideration, but the CA denied it on November 12, 2007.
Hence, this appeal by petitioner, arguing that:
THE COURT OF APPEALS SERIOUSLY ERRED IN HOLDING THAT
PETITIONERS ALANGILAN LANDHOLDING IS SUBJECT TO THE
COVERAGE OF THE COMPREHENSIVE AGRARIAN REFORM LAW,
NOTWITHSTANDING THAT THE PROPERTY HAS BEEN CONVERTED
TO NON-AGRICULTURAL USES BY THE ZONING ORDINANCE OF THE
CITY OF BATANGAS PRIOR TO THE LAW.14
Petitioner insists on exemption of the Alangilan landholding from CARP
coverage. It argues that the subject landholding had already been converted
into non-agricultural use long before the advent of the CARP. The passage
of the 1982 Ordinance, classifying the property as reserved for residential, it
asserts, effectively transformed the land into non-agricultural use, and thus,
outside the ambit of the CARL. It cites Natalia, wherein it was ruled that
lands intended for residential use are outside the coverage of the CARL.
Indeed, lands devoted to non-agricultural activity are outside the coverage
of CARL. These include lands previously converted into non-agricultural
uses prior to the effectivity of the CARL on June 15, 1988. Unfortunately,
petitioner failed to convince us that the Alangilan landholding ceased to be
agricultural at the time of the effectivity of the CARL.
It is beyond cavil that the Alangilan landholding was classified as
agricultural, reserved for residential in 1982, and was reclassified as
residential-1 in 1994. However, contrary to petitioners assertion, the term
reserved for residential does not change the nature of the land from
agricultural to non-agricultural. As aptly explained by the DAR Secretary,
the term reserved for residential simply reflects the intended land use. It
does not denote that the property has already been reclassified as
residential, because the phrase reserved for residential is not a land
classification category.
Indubitably, at the time of the effectivity of the CARL in 1988, the subject
landholding was still agricultural. This was bolstered by the fact that the
Sangguniang Panlalawigan had to pass an Ordinance in 1994, reclassifying
the landholding as residential-1. If, indeed, the landholding had already
been earmarked for residential use in 1982, as petitioner claims, then there
would have been no necessity for the passage of the 1994 Ordinance.
Petitioner cannot take refuge in our ruling in Natalia. The case is not on all
fours with the instant case. In Natalia, the entire property was converted into
residential use in 1979 and was developed into a low-cost housing
subdivision in 1982. Thus, the property was no longer devoted to
agricultural use at the time of the effectivity of the CARL.
In this case, however, petitioner failed to establish that the subject
landholding had already been converted into residential use prior to June
15, 1988. We also note that the subject landholding was still being utilized
for agricultural activities at the time of the filing of the application for
exemption. The ocular inspection, jointly conducted by the MARO, PARO
and RARO, disclosed that the landholding was planted with mangoes and
coconuts.15
In Department of Agrarian Reform v. Oroville Development
Corporation,16 we held:
[i]n order to be exempt from CARP coverage, the subject property must
have been classified as industrial/residential before June 15, 1988. In this
case, the DAR's examination of the zoning ordinances and certifications
pertaining to the subject property, as well as its field investigation, disclosed
that the same remains to be agricultural. The Zoning Certifications to the
effect that the land is within the city's potential growth area for urban
expansion are inconsequential as they do not reflect the present
classification of the land but merely its intended land use.
Not having been converted into, or classified as, residential before June 15,
1988, the Alangilan landholding is, therefore, covered by the CARP. The
subsequent reclassification of the landholding as residential-1 in 1994
cannot place the property outside the ambit of the CARP, because there is
no showing that the DAR Secretary approved the reclassification.
In a last-ditch effort to secure a favorable decision, petitioner assails the
authority of the DAR Secretary to determine the classification of lands. It
asserts that the power to classify lands is essentially a legislative function
that exclusively lies with the legislative authorities, and thus, when the
Sangguniang Bayan of Batangas City declared the Alangilan landholding as
residential in its 1994 Ordinance, its determination was conclusive and
cannot be overruled by the DAR Secretary.
The argument is specious.
The exclusive jurisdiction to classify and identify landholdings for coverage
under the CARP is reposed in the DAR Secretary. The matter of CARP
coverage, like the instant case for application for exemption, is strictly part
of the administrative implementation of the CARP, a matter well within the
competence of the DAR Secretary.17 As we explained in Leonardo Tarona,
et al. v. Court of Appeals (Ninth Division), et al.:181avvphi1
The power to determine whether a property is subject to CARP coverage
lies with the DAR Secretary pursuant to Section 50 of R.A. No. 6657. Verily,
it is explicitly provided under Section 1, Rule II of the DARAB Revised Rules JOSE CATRAL MENDOZA
that matters involving strictly the administrative implementation of the CARP Associate Justice
and other agrarian laws and regulations, shall be the exclusive prerogative
of and cognizable by the Secretary of the DAR. ATTESTATION

Finally, it is well settled that factual findings of administrative agencies are

generally accorded respect and even finality by this Court, if such findings
are supported by substantial evidence. The factual findings of the DAR
Secretary, who, by reason of his official position, has acquired expertise in
specific matters within his jurisdiction, deserve full respect and, without
justifiable reason, ought not to be altered, modified, or reversed.19 In this
case, petitioner utterly failed to show justifiable reason to warrant the
reversal of the decision of the DAR Secretary, as affirmed by the OP and
the CA.

WHEREFORE, the petition is DENIED. The assailed Decision and

Resolution of the Court of Appeals in CA-G.R. SP No. 76525 are
AFFIRMED.

Costs against petitioner.

SO ORDERED.

ANTONIO EDUARDO B. NACHURA

Associate Justice

WE CONCUR:

RENATO C. CORONA
Associate Justice
Chairperson

PRESBITERO J. VELASCO,
DIOSDADO M. PERALTA
JR.
Associate Justice
Associate Justice
 Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 175175 September 29, 2008
LAND BANK OF THE PHILIPPINES, Petitioner,
vs.
HEIRS OF ELEUTERIO CRUZ, Respondents.
DECISION
TINGA, J.:
This is a Petition for Review on Certiorari1 under Rule 45 of the 1997 Rules
of Civil Procedure, assailing the Decision2 and Resolution3 of the Court of
Appeals (CA) in CA-G.R. SP No. 93207. The CA decision affirmed the
decision of the Regional Trial Court (RTC) of Tuguegarao City, Branch 1
sitting as a Special Agrarian Court (SAC), which approved and ordered the
payment of the amount of just compensation fixed by the Cagayan
Provincial Agrarian Reform Adjudicator (PARAD) in favor of herein
respondents.4 The CA resolution denied petitioners motion for
reconsideration of the decision.5
The following factual antecedents are matters of record.
Petitioner Land Bank of the Philippines (LBP) is a government banking
institution designated under Section 64 of Republic Act (R.A.) No. 6654 as
the financial intermediary of the agrarian reform program of the government.
Respondent Heirs of Eleuterio Cruz are Anicia Cruz-Papa, Resurreccion
Cruz-Pagcaliwagan, Antonio D. Cruz, Lourdes Cruz-Doma, Lorna Cruz-
Felipe, Mamerto D. Cruz, Eduardo D. Cruz and Victoria Cruz-Dumlao.
Eleuterio Cruz is the registered owner of an unirrigated riceland situated in
Lakambini, Tuao, Cagayan per Transfer Certificate of Title No. T-368. Of the
total 13.7320 hectares of respondents landholding, an area of 13.5550
hectares was placed by the government under the coverage of the
operation land transfer program under Presidential Decree (P.D.) No. 27.6
Petitioner pegged the value of the acquired landholding at P106,935.76
based on the guidelines set forth under P.D. No. 277 and Executive Order
(E.O.) No. 228.8 Respondents rejected petitioners valuation and instituted
an action for a summary proceeding for the preliminary determination of just
compensation before the PARAD. On 23 November 1999, the PARAD
rendered a decision fixing the just compensation in the amount
of P80,000.00 per hectare.9 Petitioner sought reconsideration but was
unsuccessful.
Thus, on 28 January 2000, petitioner filed a petition for the determination of
just compensation before the RTC of Tuguegarao City.10 The petition was
docketed as Agrarian Case No. 0058 and entitled Land Bank of the
Philippines v. Heirs of Eleuterio Cruz, represented by Lorna Cruz, et al.11
Petitioners evidence consisted of the testimonies of Benedicta Simon, head
of the LBP Evaluation Division of Land Owners Compensation Department,
and Francisco de la Cruz, Chief, PARAD, Cagayan. Simon testified that as
the officer charged with reviewing claims under the agrarian reform
program, she computed the valuation of respondents landholdings based
on the formula set forth in P.D. No. 27, E.O. No. 228 and Administrative
Order (A.O.) No. 13, series of 1994 and arrived at the value of P106,935.76.
As the PARAD Chief tasked to oversee the implementation of the agrarian
reform program, De la Cruz testified that the subject landholding was
tenanted and covered by production agreements between the owner and
various tenants.12 Petitioner offered in evidence Exhibit "H" to prove that the
subject landholding had an average production of 25 and 40 cavans per
hectare annually.
For their part, respondents presented Lorna Cruz Felipe, who testified that
as one of the heirs of Eleuterio Cruz, she knew that the subject landholding
was planted with rice two or three times a year and had a production
capacity of 80 to 100 cavans per hectare. Felipe also claimed that the
current market value of the property was between P150,000.00
to P200,000.00 per hectare.13
On 07 December 2005, the RTC, sitting as an Special Agrarian Court
(SAC), rendered a decision, the dispositive portion of which reads:
WHEREFORE, in the light of the foregoing ratiocination, judgment is hereby
rendered fixing the amount of P80,000.00 to be the just compensation of the
land subject of this case with an area of 13.7320 hectares situated at
Lakambini, Tuao, Cagayan and covered under TCT No. T-368 and ordering
Land Bank of the Philippines to pay respondent represented by Lorna Cruz-
Felipe the amount of P1,098,560.00 in the manner provided by R.A. No.
6657 by way of full payment of the said just compensation.
SO DECIDED.14
The SAC held that the value of P80,000.00 per hectare fixed by the PARAD
should be accorded weight and probative value and that the SAC is guided
by the various factors enumerated in Section 1715 of R.A. No. 6657 in
determining just compensation. It disregarded respondents claim that the
valuation should be based on the current market value of the landholding
since no evidence was adduced in support of the claim. The SAC also did
not accept petitioners valuation as it was based on P.D. No. 27, in which
just compensation was determined at the time of the taking of the
property.16
Petitioner filed a motion for reconsideration, which was denied in a
Resolution dated 26 January 2006,17 prompting petitioner to elevate the
matter to the CA. In its petition for review,18 petitioner questioned the total
land area as well as the amount of just compensation adjudged by the
SAC.19
On 17 August 2006, the CA rendered the assailed decision partly granting
petitioners appeal.20 The appellate court ruled that the total area covered by
the agrarian reform program as was duly established before the PARAD
and expressly stated in the pre-trial order was only 13.5550 hectares and
not 13.7320 hectares as was stated in the dispositive portion of the decision
of the SAC.21However, the appellate court affirmed the SAC decision fixing
just compensation at P80,000.00 per hectare. Petitioner sought
consideration but was denied in the assailed Resolution dated 30 October
2006.22
Hence, the instant petition, arguing that the formula set forth in P.D. No.
27/E.O. No. 228 should be applied in fixing just compensation since
respondents landholding was acquired under P.D. No. 27. Citing Section
223 of E.O. No. 228 and LBP v. Hon. David C. Naval,24 petitioner posits that
the correct formula in determining the just compensation should be Land
Value = (2.5 x AGP x P35) x A, where AGP is the Average Gross
Production per hectare; P35.00 is the Government Support Price for palayin
1972; and A is the total land area.
Petitioner insists that the values in E.O. No. 228 are applicable to lands
acquired under P.D. No. 27 in cognizance of the well-settled rule that just
compensation is the value of the property at the time of the taking on 21
October 1972, when the ownership of the subject property was transferred
from the landowner to the farmers-beneficiaries and when the former was
effectively deprived of dominion and possession over said
land.1awphi1.net/p>
The petition lacks merit.
The Court laid down in Paris v. Alfeche25 the applicability of P.D. No. 27 and
E.O. No. 228 in relation to R.A. No. 6657 in the matter of the payment of just
compensation. There the Court explained that while under P.D. No. 27
tenant farmers are already deemed owners of the land they till, they are still
required to pay the cost of the land before the title is transferred to them and
that pending the payment of just compensation, actual title to the tenanted
land remains with the landowner.
In Paris, the application of the process of agrarian reform was still
incomplete thus, the Court held therein that with the passage of R.A. No.
6657 before its completion, the process should now be completed under
R.A. No. 6657, with P.D. No. 27 and E.O. No. 228 applying only
suppletorily.26
In Land Bank of the Philippines v. Natividad,27 the Court explained why the
guidelines under P.D. No. 27 and E.O. No. 228 are no longer applicable to
the delayed payment of lands acquired under P.D. No. 27, to wit:
It would certainly be inequitable to determine just compensation based on
the guideline provided by PD No. 27 and EO 228 considering the DARs
failure to determine the just compensation for a considerable length of time.
That just compensation should be determined in accordance with RA 6657,
and not PD 27 or EO 228, is especially imperative considering that just
compensation should be the full and fair equivalent of the property taken
from its owner by the expropriator, the equivalent being real, substantial, full
and ample.28
The decisive backdrop of the instant case coincides with that in Paris, that
is, the amount of just compensation due to respondents had not yet been
settled by the time R.A. No. 6657 became effective. Following the
aforementioned pronouncement in Paris, the fixing of just compensation
should therefore be based on the parameters set out in R.A. No. 6657, with
P.D. No. 27 and E.O. No. 228 having only suppletory effect.
Section 17 of R.A. No. 6657 states:
SEC. 17. Determination of Just Compensation. In determining just
compensation, the cost of acquisition of the land, the current value of like
properties, its nature, actual use and income, the sworn valuation by the
owner, the tax declarations, and the assessment made by government
assessors, shall be considered. The social and economic benefits
contributed by the farmers and the farmworkers and by government to the
property as well as the non-payment of taxes or loans secured from any
government financing institution on the said land shall be considered as
additional factors to determine its valuation.
In Land Bank of the Philippines v. Celada,29 the Court ruled that the factors
enumerated under Section 17, R.A. No. 6657 had already been translated
into a basic formula by the Department of Agrarian Reform (DAR) pursuant
to its rule-making power under Section 49 of R.A. No. 6657. Thus, the Court
held in Celada that the formula outlined in DAR A.O. No. 5, series of
199830 should be applied in computing just compensation.
Likewise, in Land Bank of the Philippines v. Sps. Banal,31 the Court ruled
that the applicable formula in fixing just compensation is DAR A.O. No. 6,
series of 1992, as amended by DAR A.O. No. 11, series of 1994, then the
governing regulation applicable to compulsory acquisition of lands, in
recognition of the DARs rule-making power to carry out the object of R.A.
No. 6657. Because the trial court therein based its valuation upon a different
formula and did not conduct any hearing for the reception of evidence, the
Court ordered a remand of the case to the SAC for trial on the merits.
The mandatory application of the aforementioned guidelines in determining
just compensation has been reiterated recently in Land Bank of the
Philippines v. Lim,32 where the Court also ordered the remand of the case to
the SAC for the determination of just compensation strictly in accordance
with DAR A.O. No. 6, series of 1992, as amended.
A perusal of the PARADs Decision dated 23 November 1999, which
mandated payment of just compensation in the amount of P80,000.00 per
hectare, reveals that the PARAD did not adhere to the formula prescribed in
any of the aforementioned regulations issued by the DAR or was at least
silent on the applicability of the aforementioned DAR regulations to the
question of just compensation. The PARAD decision also did not refer to
any evidence in support of its finding.
The SAC, meanwhile, referred to DAR A.O. No. 6, series of 1992, as
amended, as the controlling guideline in fixing just compensation.
Pertinently, to obtain the land value, the formula33 under said regulation
requires that the values for the Capitalized Net Income, Comparable Sales
and Market Value based on the tax declaration must be shown. Moreover,
said formula has been superseded by DAR A.O. No. 05, series of 1998,
which also requires values for Capitalized Net Income, Comparable Sales
and Market Value, the same parameters laid down in the prior regulation.
Stating that no evidence was presented by respondents on the
aforementioned parameters, the SAC ruled that it was constrained to adopt
the finding of the PARAD, which fixed the value of the land at P80,000.00 PRESBITERO J. VELASCO,
per hectare. On appeal, the CA adopted the same finding. CONCHITA CARPIO MORALES
JR.
Associate Justice
Associate Justice
The general rule is that factual findings of the trial court, especially when
affirmed by the CA, are binding and conclusive on the Court. However, the ARTURO D. BRION
rule admits of exceptions, as when the factual findings are grounded entirely Associate Justice
on speculation, surmises, or conjectures or when the findings are
conclusions without citation of specific evidence on which they are based.34

A perusal of the PARAD decision, which was adopted by both the SAC and
the CA, shows that its valuation of P80,000.00 per hectare is sorely lacking
in any evidentiary or legal basis. While the Court wants to fix just
compensation due to respondents if only to write finis to the controversy, the
evidence on record is not sufficient for the Court to do so in accordance with
DAR A.O. No. 5, series of 1998.

WHEREFORE, the instant petition for review on certiorari is DENIED and

the decision and resolution of the Court of Appeals in CA-G.R. SP No.
93207 are REVERSED and SET ASIDE. Agrarian Case No. 0058
is REMANDED to the Regional Trial Court, Branch 1, Tuguegarao City,
Cagayan, which is directed to determine with dispatch the just
compensation due respondents strictly in accordance with DAR A.O. No. 5,
series of 1998.

SO ORDERED.

DANTE O. TINGA
Associate Justice

WE CONCUR:

LEONARDO A. QUISUMBING
Associate Justice
Chairperson
 THIRD DIVISION
[G.R. No. 143275. September 10, 2002]
LAND BANK OF THE PHILIPPINES, petitioner, vs. ARLENE DE LEON
and BERNARDO DE LEON, respondents.
DECISION
CORONA, J.:
Before us is a petition for review of the resolution,[1] dated February 15,
2000, of the Court of Appeals[2] dismissing the ordinary appeal of petitioner
Land Bank of the Philippines (LBP, for brevity), and resolution[3] dated May
22, 2000 denying the motion for reconsideration thereof.
The undisputed facts as found by the appellate court are as follows:
The petitioners-appellees Arlene de Leon and Bernardo de Leon are the registered
owners of a parcel of land situated at San Agustin, Concepcion, Tarlac covered by
TCT No. 163051 with a total area of 50.1171 hectares. The subject property was
voluntarily offered for sale to the government pursuant to RA 6657 at P50,000.00
per hectare. The Department of Agrarian Reform (DAR) made a counter offer of
P17,656.20 per hectare, or a total amount of P884,877.54, but the same was
rejected. Another offer was made by DAR increasing the amount to
P1,565,369.35. In view of the petitioners-appellees failure to respond to the new
offer made by DAR, the Department of Agrarian Reform Adjudication Board
(DARAB) took cognizance of the case pursuant to Sec. 16 (d) of RA 6657.
Subsequently, the DARAB issued an Order directing respondent-appellant LBP to
recompute the value of the subject property in accordance with DAR
Administrative Order No. 6, Series of 1992. Applying the pertinent provisions of
the said DAR administrative order, respondent-appellant arrived at a recomputed
land value as follows:
Land Use Area Acquired Value/hectare Total/Land Value
Sugarland 32.4187 P61,758.85 P2,002,141.63
Riceland 16.6984 P28,449.80 P 475,066.14
Idle land 1.0000 P14,523.78 P 14,523.78
or an aggregate amount of P2,491,731.65, which was again rejected by the
petitioners-appellees.
In a Petition dated October 27, 1994, filed with the Regional Trial Court, Branch
63, Tarlac, which is the designated Special Agrarian Court in the area, petitioners-
appellees asked the court, among others, to fix the just compensation of the subject
property.
In due time the court rendered a summary judgment on December 19, 1997 fixing
the compensation of the subject property as follows:
a. P1,260,000.00 for the 16.69 hectares of riceland;
b. P2,957,250.00 for the 30.4160 hectares of sugarland.
Within the time allowed, respondent-appellant filed a Motion for
Reconsideration which was subsequently denied by the Court.[4]
xxx xxx xxx
On March 17, 1998, the Department of Agrarian Reform filed in the Court
of Appeals a petition for review of the decision of the Special Agrarian Court.
The said petition, docketed as CA-G.R. SP No. 47005, was assigned to the
Special Third (3rd) Division of the Court of Appeals. Petitioner LBP also
initiated in the Court of Appeals an appeal of the same decision of the Special
Agrarian Court by filing a notice of appeal. Docketed as CA-G.R. CV No.
60365, the said ordinary appeal was assigned to the Fourth (4th) Division of
the Court of Appeals.
 On November 6, 1998, the Special Third (3rd) Division of the appellate
court, through then Associate Justice Minerva Gonzaga-Reyes[5], rendered in
CA-G.R. SP No. 47005 a decision[6], the dispositive portion of which reads:
WHEREFORE, premises considered, the petition for review is GIVEN DUE
COURSE. The decision dated February 9, 1998 is partially reconsidered. The trial
court is ordered to recompute the compensation based on the selling price of palay
at 213.00 per cavan. Petitioner is ordered to pay legal interest at 6% of the
compensation so fixed from 1990 until full payment is made by the government.
SO ORDERED.[7]
Thereafter, on February 15, 2000, the Fourth (4th) Division of the Court
of Appeals dismissed petitioner LBPs ordinary appeal (CA-G.R. CV No.
60365), in a resolution dated February 15, 2000, the dispositive portion of
which reads:
WHEREFORE, the appeal is DISMISSED for lack of merit.[8]
In dismissing the ordinary appeal (CA-G.R. CV No. 60365) instituted by
petitioner LBP, the appellate court reasoned that the mode of appeal followed
by the petitioner was erroneous considering that Section 60 of RA 6657,
otherwise known as the Comprehensive Agrarian Reform Law, mandates that
appeals from decisions of Special Agrarian Courts should be by petition for
review. Therefore, the notice of appeal filed by LBP was ineffectual and did
not stop the running of the period of appeal. Also, the appellate court took
note of the decision rendered by the Special Third (3rd) Division of the same
court involving the same issue and parties, to wit:
All these notwithstanding LBP does not stand to lose anything at all. While it did
suffer a setback in this instant case LBP in one way or the other still we note that it
is likewise victorious in the appeal brought by the DAR (CA-G.R. SP 47005). In a
decision rendered on November 6, 1998 this court ordered the trial court to
recompute the compensation based on the selling price of palay at P213.00 per
cavan. Thus to this effect with more reason that we should deny the appeal even
granting the mode of appeal as availed of is correct to avoid any contradiction of
this divisions with that of the other.[9]
Petitioner LBP filed a motion for reconsideration but the same was
denied in a resolution dated May 22, 2000.
Hence, this petition questioning the resolutions of the Fourth (4th)
Division of the Court of Appeals on the following assignment of errors:
I
IN RULING THAT SECTION 60 OF RA 6657 PROVIDES THE PROPER MODE
FOR THE REVIEW OF THE DECISIONS OF THE SPECIAL AGRARIAN
COURTS DESPITE SECTION 61 OF RA 6657 WHICH EXPRESSLY
MANDATES THAT THE RULES OF COURT SHALL GOVERN THE REVIEW
OF THE DECISIONS OF THE SPECIAL AGRARIAN COURTS BY THE
COURT OF APPEALS;
II
IN NOT RECOGNIZING THAT SECTION 61 OF RA 6657 PREVAILS OVER
SECTION 60 OF RA 6657, INASMUCH AS THE MODE OF APPEAL OF A
COURTS DECISION IS A MATTER OF PROCEDURE WHICH IS COVERED
BY THE EXCLUSIVE RULE-MAKING POWER OF THE SUPREME COURT
UNDER SECTION 5(5), ARTICLE VIII OF THE 1987 CONSTITUTION AND
IN ACCORDANCE WITH EXISTING JURISPRUDENCE;
III
IN DECLARING THAT THE SUPREME COURT MERELY MADE AN
INADVERTENT MISTAKE IN REVISING SECTION 1, RULE 43 OF THE
RULES OF COURT AND REMOVING THE DECISIONS OF THE SPECIAL
AGRARIAN COURT FROM THE LIST OF THOSE APPEALABLE TO THE
COURT OF APPEALS BY PETITION FOR REVIEW; AND
IV
IN DISMISSING THE APPEAL OF THE PETITIONER, DESPITE ITS RULING
THAT THE SUPREME COURT MADE A MISTAKE IN ITS
ADMINISTRATIVE ORDERS, RENDERING SUCH DISMISSAL AS HIGHLY
UNJUST, OPPRESSIVE AND CONTRARY TO DUE PROCESS OF LAW. [10]
 The case at bar requires an interpretation of Sections 60 and 61 of RA
6657. The said provisions provide that:
Section 60. Appeals, - An appeal may be taken from the decision of the Special
Agrarian Courts by filing a petition for review with the Court of Appeals within
fifteen (15) days from receipt of notice of the decision; otherwise, the decision shall
become final.
Section 61.- Procedure in Review. Review by the Court of appeals or the Supreme
Court, as the case may be, shall be governed by the Rules of Court. The Court of
Appeals, however, may require the parties to file simultaneous memoranda within a
period of fifteen (15) days from notice, after which the case is deemed submitted for
decision.
Respondent spouses point to Section 60 of RA 6657 to support their view
that the mode of appeal initiated by petitioner LBP was erroneous. On the
other hand, petitioner LBP believes that the mode of appeal it used is
permissible under Section 61 of the same law.
What indeed is the proper mode of appeal from decisions of the Regional
Trial Courts, sitting as Special Agrarian Courts, in the determination of just
compensation an appeal by way of a petition for review or an ordinary appeal?
Section 2 of Rule 41 of the 1997 Revised Rules of Civil Procedure
provides for three modes of appeal, to wit:
Sec. 2. Modes of Appeal.
(a) Ordinary appeal. The appeal to the Court of Appeals in cases
decided by the Regional Trial Court in the exercise of its original
jurisdiction shall be taken by filing a notice of appeal with the
court which rendered the judgment or final order appealed from
and serving a copy thereof upon the adverse party. No record on
appeal shall be required except in special proceedings and other
cases or multiple or separate appeals where the law or these
Rules so require. In such cases, the record on appeal shall be
filed and served in like manner.
(b) Petition for Review. The appeal to the Court of Appeals in cases
decided by the Regional Trial Court in the exercise of its
appellate jurisdiction shall be by petition for review in accordance
with Rule 42.
(c) Appeal by Certiorari. In all cases where only questions of law are
raised or involved, the appeal shall be to the Supreme Court by
petition for review on certiorari in accordance with Rule 45.
Petitioner LBP, in its bid to maintain the legitimacy of its appeal, contends
that the proper mode of appeal from a decision of the Special Agrarian Court
is by way of a notice of appeal due to the reference by Section 61 of RA 6657
to the Rules of Court as the governing procedure for appeals to the Court of
Appeals. This being the case, the petitioner claims that the procedure for
ordinary appealed cases provided for in Section 2(a) of Rule 41 of the 1997
Revised Rules of Civil Procedure must be followed, that is, a notice of appeal
is required in order to perfect the appeal. According to the petitioner, this is
the proper mode of appeal in the case at bar considering that the appealed
decision is that of the Regional Trial Court in the exercise of its original
jurisdiction. Moreover, Section 1 of Rule 43 of the 1997 Revised Rules of Civil
Procedure[11] (pertaining to appeals by way of petitions for review to the Court
of Appeals of decisions of quasi-judicial agencies and the Court of Tax
Appeals), does not include decisions of the Regional Trial Courts acting as
Special Agrarian Courts.
We deny the petition.
A petition for review, not an ordinary appeal, is the proper procedure in
effecting an appeal from decisions of the Regional Trial Courts acting as
Special Agrarian Courts in cases involving the determination of just
compensation to the landowners concerned. Section 60 of RA 6657 clearly
and categorically states that the said mode of appeal should be adopted.
There is no room for a contrary interpretation. Where the law is clear and
categorical, there is no room for construction, but only application.[12]
According to the petitioner, Section 61 of RA 6657 should be followed,
not Section 60. The reference by Section 61 to the Rules of Court implies that
an ordinary appeal requiring a notice of appeal is the proper manner of
appealing decisions of Special Agrarian Courts on just compensation
because Section 2(a) of Rule 41 of the 1997 Revised Rules of Civil Procedure
provides that decisions of the Regional Trial Courts in the exercise of their
original jurisdiction follow the procedure governing ordinary appeals.
We do not agree.
First, there is no conflict between Section 60 and 61 of RA 6657
inasmuch as the Rules of Court do not at all prescribe the procedure for
ordinary appeals as the proper mode of appeal for decisions of Special
Agrarian Courts. Section 61 in fact makes no more than a general reference
to the Rules of Court and does not even mention the procedure for ordinary
appeals in Section 2, Rule 41 of the 1997 Revised Rules of Civil Procedure
as the appropriate method of elevating to the Court of Appeals decisions of
Special Agrarian Courts in eminent domain cases.
Second, the failure to mention Special Agrarian Courts in Section 1 of
Rule 43 of the Revised Rules of Civil Procedure cannot be construed to mean
that a petition for review is not permissible for decisions of the said special
courts. In fact, the said Rule is not relevant to determine whether a petition
for review is the proper mode of appeal from decisions of Regional Trial
Courts in agrarian cases, that is, when they act as Special Agrarian Courts.
Section 1 of Rule 43 of the 1997 Revised Rules of Civil Procedure merely
mentions the Court of Tax Appeals and the other different quasi-judicial
agencies without exclusivity in its phraseology. Such omission cannot be
construed to justify the contention that a petition for review is prohibited for
decisions on special agrarian cases inasmuch as the category is for quasi-
judicial agencies and tax courts to which the Regional Trial Courts do not
properly belong. Although Supreme Court Circular No. 1-91[13] (precursor to
Rule 43 of the Revised Rules of Civil Procedure) included the decisions of
Special Agrarian Courts in the enumeration requiring petition for review, its
non-inclusion later on in Rule 43 merely signifies that it was inappropriately
classified as a quasi-judicial agency.
What is indisputable is that Section 60 expressly regards a petition
for review as the proper way of appealing decisions of agrarian courts.
So far, there is no rule prescribed by this Court expressly disallowing
the said procedure.
Third, far from being in conflict, Section 61 of RA 6657 can easily be
harmonized with Section 60. The reference to the Rules of Court means that
the specific rules for petitions for review in the Rules of Court and other
relevant procedures in appeals filed before the Court of Appeals shall be
followed in appealed decisions of Special Agrarian Courts. Considering that
RA 6657 cannot and does not provide the details on how the petition for
review shall be conducted, a suppletory application of the pertinent provisions
of the Rules of Court is necessary. In fact, Section 61 uses the word review
to designate the mode by which the appeal is to be effected. The reference
therefore by Section 61 to the Rules of Court only means that the procedure
under Rule 42 for petitions for review is to be followed for appeals in agrarian
cases.
According to the petitioner, an ordinary appeal prescribed under the
Rules of Court should prevail over a petition for review provided under Section
60 of RA 6657 inasmuch as a contrary interpretation would violate the
constitutional provision granting to the Supreme Court the power to
promulgate rules concerning the protection and enforcement of constitutional
rights, pleadings, practice, and procedure in all courts, the admission to the
practice of law, the Integrated Bar, and Legal Assistance to the
underprivileged. (italics supplied)[14]
As earlier mentioned, there is nothing in the Rules of Court that
categorically prohibits the adoption of the procedure for petitions for review of
decisions of Special Agrarian Courts. Section 60 of RA 6657 and the
provisions of the Rules of Court can be harmonized and can co-exist.
Moreover, the same Section 5 (5), Article VIII, of the 1987 Philippine
Constitution quoted by the petitioner states that (r)ules of procedure of special
courts and quasi-judicial bodies shall remain effective unless disapproved by
the Supreme Court. Section 60 is obviously a special procedure. Contrary to
the petitioners contention, it cannot be otherwise merely because it was
formulated by the legislature and not by any special body. As long as the said
section provides for a particular process for the governance of the special
court concerned, the provision is accurately classified as a special procedure.
Subject to constitutional limitations, the statutory enactment of a special
procedure cannot be said to encroach on the power of this Court to formulate
rules of procedure for the reason that we have not
yet provided for a particular process specifically governing agrarian courts. I
n fact, this Court exercises its constitutional power to promulgate special rules
of procedure by adopting Sections 60 and 61 of RA 6657 declaring a petition
for review as the proper mode of appeal to the Court of Appeals.
 The reason why it is permissible to adopt a petition for review when
appealing cases decided by the Special Agrarian Courts in eminent domain
cases is the need for absolute dispatch in the determination of just
compensation. Just compensation means not only paying the correct amount
but also paying for the land within a reasonable time from its acquisition.
Without prompt payment, compensation cannot be considered just for the
property owner is made to suffer the consequences of being immediately
deprived of his land while being made to wait for a decade or more before
actually receiving the amount necessary to cope with his loss.[15] Such
objective is more in keeping with the nature of a petition for review.
Unlike an ordinary appeal, a petition for review dispenses with the filing
of a notice of appeal or completion of records as requisites before any
pleading is submitted. A petition for
review hastens the award of fair recompense to deprived landowners for the
government-acquired property, an end not foreseeable in an ordinary appeal.
This is exemplified by the case at bar in which the petition for review before
the Special Third (3rd) Division (CA-G.R. SP No. 47005) was disposed of way
ahead of the ordinary appeal filed before the Fourth (4th) Division (CA-G.R.
CV No. 60365) in the Court of Appeals.
Inasmuch as the notice of appeal filed by petitioner LBP did not stop the
running of the reglementary period to file a petition for review, the time to
appeal the decision of the Special Agrarian Court has lapsed, rendering the
said decision final and executory.
WHEREFORE, the appealed RESOLUTIONS, dated February 15, 2000,
and May 22, 2000, respectively, of the Court of Appeals are hereby
AFFIRMED. No costs.
SO ORDERED.