G.R. No. 210422 - LAND BANK OF THE PHILIPPINES, VS. SPOUSES LYDIA G. CORTEZ AND CARLOS CORTEZ.D E C I S I O N - Supreme Court E-Library

Ruling

Accordingly, LBP filed a Petition for Determination of Just Compensation [28] before the RTC docketed as Agrarian Case No. 07-02, arguing that the preliminary determination of valuation of the subject property made by LBP was in accordance with Section 17 of R.A. No. 6657. [29] Ruling of the RTC In its Decision [30] dated December 21, 2011, the RTC, acting as a Special Agrarian Court, fixed the amount of compensation for the acquired subject property at P397,958.41 based on the report prepared by the court appointed commissioner. The dispositive portion of the decision reads: WHEREFORE , the Court hereby renders judgment and declares, as follow, to wit: a) The just compensation for the 6.0004 hectares of coconut land owned by the private respondents, Spouses Lydia and Carlos Cortez, is hereby fixed in the amount of PhP397,958.41 . b) The petitioner is hereby directed to compensate the private respondents in the afore-said sum minus the amount actually received in cash by the private respondents, if anything, within a period of thirty (30) days from notice of this decision free of any interest, and with interest at the rate of 12 percent per annum if not compensated within the 30-day period herein mandated, which payment of interest shall commence on the 31 st day from notice of the decision until the amount of just compensation is fully satisfied or received by the private respondents. [31] (Emphases in the original) In computing for the foregoing amount of compensation, the RTC directed the commissioner to make use of the formula prescribed under AO No. 5, Series of 1998, which was similarly used by LBP with a modification that the production values and other relevant data be reckoned with the presumptive date of taking on June 30, 2009, in accordance with AO No. 1, Series of 2010. [32] In arriving at the foregoing ruling, the RTC ratiocinated that fixing the amount of compensation due to spouses Cortez based on the market prices and production data at that time may do injustice to them. [33] The RTC recognized that AO No. 5, Series of 1998 provides for two reckoning dates in determining the production data or values necessary in arriving at the compensation due to spouses Cortez. First , the AGP shall be determined based on the latest available 12-month gross production quantity immediately preceding the date of the field investigation, which was conducted on April 24, 2000. Second , the SP shall be determined based on the average selling prices of production within the 12-month period preceding the date of receipt of the claims folder by LBP, which was on September 27, 2001. [34] The RTC held that strictly observing the foregoing parameters under AO No. 5, Series of 1998 would severely diminish the purchasing power of the payment due to spouses Cortez given the annual inflation rates. [35] Accordingly, to address the "undeserved diminution of value" of compensation if the RTC were to adhere to the reckoning periods for production value under