Landbank loses valuation dispute on agricultural lot

THE Supreme Court ( SC) has denied with finality a motion for reconsideration by the Land Bank of the Philippines ( Landbank), in a case involving a dispute over the bank’s interest liability arising from an agricultural land transaction.

In a seven- page resolution, the SC Special First Division dismissed the state-owned bank’s request to be “discharged from the payment of legal interest on the unpaid balance of the just compensation,” and ordered the Regional Trial Court to compute the legal interest due to the heirs of Alfredo Hababag, Sr. for his 69.39 hectares of agricultural land.

“Wherefore the Court hereby resolves to deny with finality the Land Bank of the Philippines’ Motion for Reconsideration of the Court’s decision dated September 16,” according to the ruling written by Associate Justice Estrela M. Perlas-Bernabe.

Concurring were Associate Justices Lucas P. Bersamin, Jose Portugal Perez and Acting Chairperson Teresita J. Leonardo- de Castro.

Landbank had initially valued the property at P1.2 million but the Court of Appeals (CA) decision dated Nov. 15, 2005 set the amount at P2,398,487.24.

The subject property, situated in Barangays Carriedo, Manapao and Casili in the Municipality of Gubat, Sorsogon, is covered by Transfer Certificate of Title No. T-12107 and was voluntarily offered for sale to the government under Republic Act 6657 ( RA 6657) or the Comprehensive Agrarian Reform Act of 1998.

The High Court imposed legal interest on the unpaid balance, “but modified the imposable interest rate,” in line with the Bangko Sentral ng Pilipinas — Monetary Board Circular No. 799 Series of 2013.

“[ T] he interest shall be pegged at the rate of twelve percent (12%) per annum (p.a.) on the unpaid balance, reckoned from the time of taking, or the time or the time when the landowner was deprived of the use and benefit of his property, such as when title is transferred to the Republic of the Philippines, or emancipation patents are issued by the government, until June 30, 2013, and thereafter, at six percent (6%) p.a. until full payment.” read the resolution.

SC rejected the computations of just compensation made by the Sorsogon City RTC branch 52, sitting as a Special Agrarian Court, which applied the Income Productivity Approach, which was deemed out of step with the purpose of the government’s acquisition of agricultural land and the jurisdictional definition of just compensation in expropriation cases.

The affirmed CA valuation made use of a Department of Agrarian Reform formula which specifies the factors in determining just compensation under Section 17 of RA 6657. —