Land Bank of the Philippines v. Nable
REITERATIONFacts
The Antecedents: Veronica Atega Nable (Nable) was the sole owner of a 129.4615-hectare agricultural landholding in Butuan City. The Department of Agrarian Reform (DAR) compulsorily acquired 127.3365 hectares under the Comprehensive Agrarian Reform Program (CARP). Land Bank of the Philippines (LBP) valued the affected landholding at ₱5,125,036.05, which Nable rejected. Procedural History: The DAR Adjudication Board (DARAB) affirmed LBP's valuation. Nable filed a petition for judicial determination of just compensation, praying for ₱44,567,775.00. A board of commissioners recommended ₱57,660,058.00. The Regional Trial Court (RTC), as Special Agrarian Court (SAC), awarded ₱26,523,180.00, plus interest, commissioner's fees, and attorney's fees. The Court of Appeals (CA) affirmed with modification, setting the just compensation at ₱36,159,855.00, less the amount already paid, and ordered LBP to pay the remaining balance with 12% interest per annum. The Petition: LBP assails the CA's decision, arguing that the RTC and CA disregarded Section 17 of Republic Act No. 6657, DAR Administrative Orders (AO) No. 11, S. of 1994, and AO No. 5, S. 1998, and relied on inadmissible evidence. LBP also questions the award of interest, commissioner's fees, and attorney's fees.
Issue(s)
Whether the Court of Appeals (CA) and the Regional Trial Court (RTC) gravely erred in disregarding Section 17 of Republic Act No. 6657 (RA 6657) and Department of Agrarian Reform Administrative Order (DAR AO) No. 5, Series of 1998. Whether the CA and RTC gravely erred in taking judicial notice of the respondent's evidence such as caretaker's affidavit, farming experience, and rule of thumb method of conversion, which are allegedly not related to the factors enumerated under Section 17 of RA 6657 and DAR AOs. Whether the CA gravely erred in giving probative value and judicial notice to the Board of Commissioners' Report without conducting a hearing thereon. Whether the CA gravely erred in awarding twelve percent (12%) interest per annum on the remaining balance, commissioner's fees, and ten percent (10%) attorney's fees.
Ruling
The appeal is denied for lack of merit. The Court affirms the decision of the Court of Appeals with modifications.
Ratio Decidendi
On the alleged disregard of Section 17, RA 6657 and DAR AO No. 5, Series of 1998: The Court held that both the CA and the RTC did not disregard Section 17 of RA 6657 and DAR AO No. 5, Series of 1998. Instead, they applied the formula prescribed therein, considering the factors enumerated in Section 17, which include the land's nature, actual use, income, and the volume of its produce. The RTC's valuation was based on the landholding's characteristics, location, market value, assessor's value, and the volume and value of its produce, which aligns with the mandate of Section 17. The Court reiterated that the formulae under the DAR AOs are mandatory and have been consistently regarded as such by the Supreme Court. The RTC's consideration of actual production data, supported by evidence and expert opinion, was deemed more accurate than government statistics alone, especially when the land was fully cultivated and productive. On the alleged erroneous admission of evidence: The Court found that LBP's objection to the affidavit of Wilma Rubi was raised for the first time on appeal, making it tardy and thus deemed waived. Objections to evidence must be timely raised during the proceedings where the evidence is first offered to allow the adverse party to meet the objection and the court to rule on it. Failure to object timely results in estoppel. Furthermore, LBP's counsel did not appear at the hearing for the approval of the Commissioners' Report, despite being notified, and only submitted a memorandum later. This inaction, coupled with the failure to object to the affidavit during trial, led the CA to correctly reject the belated objection and consider the affidavit as an implied admission. On the alleged error in giving probative value to the Commissioners' Report: The Court clarified that the RTC, as SAC, did not solely rely on the Commissioners' Report but considered it alongside other evidence and factors. Unlike in Land Bank of the Philippines v. Banal, where the RTC did not conduct hearings or appoint commissioners, the RTC in this case conducted hearings, appointed a board of commissioners, and gave due regard to various factors before arriving at its valuation. The RTC's process was found to be more thorough and compliant with procedural requirements compared to the cases cited by LBP where valuations were set aside due to procedural infirmities or disregard of the prescribed formula. On the award of interest, commissioner's fees, and attorney's fees: The CA correctly prescribed a 12% interest per annum on the unpaid balance of the just compensation, reckoned from the time of taking, in accordance with established jurisprudence. The commissioner's fee of ₱25,000.00 was deemed proper for the services rendered. However, the Court sustained the CA's deletion of the RTC's award of 10% attorney's fees, citing Article 2208 of the Civil Code, which requires factual, legal, and equitable justifications for such awards, and that the reason for the award must be explained in the body of the decision, not just in the dispositive portion.
Main Doctrine
The determination of just compensation under Republic Act No. 6657 must consider all enumerated factors and adhere to the prescribed formula in DAR Administrative Order No. 5, Series of 1998, unless specific factors are absent. Objections to evidence must be raised timely during proceedings to be considered on appeal.