Dear Atty. Gab,

Musta Atty! My name is Carlos Mendoza, and I own a piece of agricultural land in Batangas. Recently, about five hectares were acquired by the Department of Agrarian Reform (DAR) under the Comprehensive Agrarian Reform Program (CARP). I voluntarily offered it, hoping for a fair process.

However, I was quite disappointed with the valuation offered by the Land Bank of the Philippines (LBP). They offered only about P80,000 per hectare, which I feel is extremely low. My land is located near the provincial road and is quite close to the town proper, which has been growing recently. There have been sales of nearby, less accessible lots for much higher prices, closer to P200,000 per hectare, though maybe not purely agricultural. I believe my land has potential beyond just farming.

I rejected the LBP valuation and filed a protest with the DAR Adjudication Board (DARAB) about six months ago, asking for at least P200,000 per hectare. The problem is, I haven’t received any updates or decisions since then. It feels like my case is just sitting there. I’m getting worried because the value of money decreases over time, and this delay is affecting my plans.

My question is, can I already file a case directly with the Regional Trial Court (RTC) to determine the correct just compensation, even if the DARAB hasn’t issued a decision yet? I’ve heard the courts have the final say, but I’m unsure if I have to wait for the DARAB process to finish. I feel the LBP/DAR formula didn’t capture the real value considering its location and potential. What are my options? Thank you for your guidance.

Respectfully,
Carlos Mendoza

Dear Mr. Mendoza,

Thank you for reaching out. I understand your frustration regarding the valuation of your land acquired under CARP and the delay in the DARAB proceedings. It’s a situation many landowners face, and navigating the process can indeed be confusing.

You are correct that the determination of just compensation is ultimately a judicial function. While the DARAB conducts administrative proceedings to determine valuation, this is considered preliminary. The Regional Trial Court, acting as a Special Agrarian Court (SAC), possesses original and exclusive jurisdiction over petitions for the determination of just compensation. Therefore, you generally have the right to bring the matter before the SAC even without a final decision from the DARAB, especially under certain circumstances like unreasonable delay. However, it’s crucial to understand how the court arrives at its decision, as it’s not entirely free to set any value.

Understanding the Path to Fair Compensation in Agrarian Reform

The process for determining just compensation under Republic Act No. 6657 (the Comprehensive Agrarian Reform Law or CARL) involves both administrative and judicial stages. Initially, the LBP is tasked with determining the value, which the landowner can accept or reject. If rejected, the matter typically goes to the DARAB for a summary administrative proceeding.

However, the authority of the DARAB is preliminary. The final determination rests with the courts. Section 57 of RA 6657 clearly establishes this:

“Section 57. Special Jurisdiction. – The Special Agrarian Court shall have original and exclusive jurisdiction over all petitions for the determination of just compensation to landowners, and the prosecution of all criminal offenses under this Act. x x x”

This means you don’t necessarily have to wait indefinitely for the DARAB. The Supreme Court has affirmed that direct resort to the SAC is permissible. The principle of exhaustion of administrative remedies, which usually requires completing administrative processes before going to court, may not strictly apply if there has been unreasonable delay or official inaction by the administrative body, or if the issue is purely legal. Furthermore, filing a case with the SAC while a DARAB case is pending is generally not considered forum shopping.

This is because a DARAB decision on valuation is not final and does not prevent the court from making its own independent determination. As the Supreme Court has noted:

“The DARAB’s land valuation is only preliminary and is not, by any means, final and conclusive upon the landowner or any other interested party. The courts, in this case, the SAC, will still have to review with finality the determination, in the exercise of what is admittedly a judicial function.”

However, while the SAC has the final say, it cannot simply disregard the legal framework established for valuation. Section 17 of RA 6657 provides specific factors that must be considered:

“Section 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 farm workers and by the 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.”

These factors have been translated into a basic formula under various DAR Administrative Orders (like AO No. 6, series of 1992, as amended). The Supreme Court has consistently held that the SAC is mandated to use this formula and consider these factors. It cannot simply invent its own valuation method or rely solely on one factor, like market value based on nearby sales, especially if those sales involve properties with different classifications or uses.

The Court emphasized the mandatory nature of applying the formula:

“Special Agrarian Courts are not at liberty to disregard the formula laid down in DAR A.O. No. 5, series of 1998 [Note: or other applicable AOs], because unless an administrative order is declared invalid, courts have no option but to apply it. The courts cannot ignore, without violating the agrarian law, the formula provided by the DAR for the determination of just compensation.”

Therefore, while you can file a petition with the SAC citing the DARAB’s delay, your arguments for a higher valuation must be anchored on the factors listed in Section 17 and demonstrate how the LBP/DAR’s application of the formula might have been deficient or failed to adequately capture these factors (e.g., incorrect data used for comparable sales, failure to account for specific features affecting productivity or value). Simply stating that nearby land sold for more might not be sufficient if those lands are not truly comparable or if their value is based on non-agricultural potential not yet officially recognized (e.g., through reclassification).

Regarding the land’s potential due to proximity to the town, the court generally values the land based on its actual use at the time of taking, which is agricultural under CARP. Future potential might be considered but usually within the context of its agricultural productivity or legally recognized reclassification. Taking judicial notice (accepting a fact as true without formal evidence) of the land’s supposed commercial nature requires caution and usually a hearing where parties can present evidence, as per court rules.

Practical Advice for Your Situation

• Document the Delay: Keep records of when you filed the DARAB petition and any follow-ups (or lack thereof) to demonstrate unreasonable delay.
• Gather Evidence Based on Sec. 17: Collect proof supporting your desired valuation, specifically relating it to the factors in Section 17: recent, comparable agricultural land sales; evidence of actual income/productivity; tax declarations; location details enhancing agricultural value; and assessments from government assessors, if available.
• Consult a Lawyer for SAC Filing: Engage legal counsel experienced in agrarian law to prepare and file a formal Petition for Determination of Just Compensation with the RTC designated as a Special Agrarian Court in your region.
• Argue Within the Framework: Frame your arguments for higher compensation by showing how the LBP/DAR valuation inadequately applied the DAR formula or failed to correctly consider the specific factors under Section 17 based on your evidence. Don’t just ask the court to ignore the formula.
• Address Comparability: If citing nearby land sales, be prepared to demonstrate their comparability in terms of size, use (agricultural), location attributes relevant to agriculture, and time of sale relative to the taking of your land.
• Potential Use vs. Actual Use: While potential can be mentioned, focus arguments on factors relevant to the land’s agricultural value at the time of taking, as required by CARP valuation principles, unless there’s official reclassification.
• Court Fees: Be prepared to pay the appropriate docket fees based on the amount of just compensation you are claiming in your court petition.

Filing with the SAC is a viable option given the circumstances you described, particularly the delay. However, success hinges on presenting a strong case grounded in the specific factors and procedures mandated by RA 6657 and relevant DAR regulations, rather than solely on perceived market value or future potential.

Hope this helps!

Sincerely,
Atty. Gabriel Ablola

For more specific legal assistance related to your situation, please contact me through gaboogle.com or via email at connect@gaboogle.com.

Disclaimer: This correspondence is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please schedule a formal consultation.