G.R. No. 177404 - LAND BANK OF THE PHILIPPINES, VS. KUMASSIE PLANTATION COMPANY INCORPORATED. [G.R. No. 178097]KUMASSIE PLANTATION COMPANY INCORPORATED, VS. LAND BANK OF THE PHILIPPINES AND THE SECRETARY OF THE DEPARTMENT OF AGRARIAN REFORM.D E C I S I O N - Supreme Court E-Library

Ruling

WHEREFORE , premises considered, the Decision of the Regional Trial Court (RTC), 11 th Judicial Region, Br. 15, Davao City is AFFIRMED with MODIFICATION . As modified, as none should be awarded, the award of interest is deleted. No costs. [35] LBP and KPCI each filed its own Motion for Reconsideration of the 24 November 2005 Decision of the Court of Appeals, [36] but both Motions were denied by the appellate court in its Resolution dated 30 March 2007. Hence, LBP and KPCI separately sought recourse from this Court by virtue of the Petitions for Review presently before us, docketed as G.R. No. 177404 and G.R. No. 178097, respectively. The two Petitions were consolidated since they arose from the same set of facts. [37] The procedure for the determination of compensation cases under Republic Act No. 6657, as devised by this Court, [38] commences with the valuation by the LBP of the lands taken by the State from private owners under the land reform program. Based on the valuation of the land by the LBP, the DAR makes an offer to the landowner through a written notice. In case the landowner rejects the offer, a summary administrative proceeding is held and, afterwards, depending on the value of the land, the Provincial Agrarian Reform Adjudicator (PARAD), the Regional Agrarian Reform Adjudicator (RARAD), or the DARAB, fixes the price to be paid for the said land. If the landowner still does not agree with the price so fixed, he may bring the matter to the RTC, acting as Special Agrarian Court. In the process of determining the just compensation due to landowners, it is a necessity that the RTC takes into account several factors enumerated in Section 17 of Republic Act No. 6657, as amended, to wit: 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 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. Being the government agency primarily charged with the implementation of the agrarian reform program, DAR issued DAO No. 6, Series of 1992, as amended, filling out the details necessary for the implementation of Section 17 of Republic Act No. 6657. DAR translated the factors specified in Section 17 of Republic Act No. 6657, into a basic formula, presented as follows in DAO No. 6, Series of 1992, as amended: LV = (CNI x 0.6) + ( CS x 0.3) + (MV x 0.1) Where: LV = Land Value CNI = Capitalized Net Income CS = Comparable Sales MV = Market Value per Tax Declaration The above formula shall be used if all the three factors are present, relevant, and applicabl