LAND VALUATION as appreciated in Presidential Decree no. 27 and Executive Order no.

228 Defining Land Valuation Land valuation deals with the process of determining the proper [and just] compensation for the land taken from the land owners. It also identifies the accepted modes of payment and the remedies available to the land owners in cases wherein the valuation for the lands are too low. PRESIDENTIAL DECREE No. 27 (Promulgated on October 21, 1972) DECREEING THE EMANCIPATION OF TENANTS FROM THE BONDAGE OF THE SOIL, TRANSFERRING TO THEM THE OWNERSHIP OF THE LAND THEY TILL AND PROVIDING THE INSTRUMENTS AND MECHANISM THEREFOR (Excerpts) This shall apply to tenant farmers of private agricultural lands primarily devoted to rice and corn under a system of sharecrop or lease-tenancy, whether classified as landed estate or not x x x The Department of Agrarian Reform, through its Secretary, is hereby empowered to promulgate rules and regulations for the implementation of this Decree. Provided that The tenant farmer, whether in land classified as landed estate or not, shall be deemed owner of a portion constituting a family-size farm of five (5) hectares if not irrigated; three (3) hectares if irrigated; This rule could easily be applicable to vast track of lands which are privately owned. However, the proportion to be owned by tenant farmers in lands which do not go as largely as 5 or 3 hectares or more, is not provided for. In all cases, the landowner may retain an area of not more than seven (7) hectares if such landowner is cultivating such area or will now cultivate it; In comparison to this provision where there is more or less a concrete rule; that he may own as much area as desired only that the land area would not go beyond 7 hectares. Process of Land Valuation as to cost of land determining the cost of the land to be transferred to the tenant -farmer the value of the land shall be equivalent to (2 1/2) times the average harvest of (3) normal crop years immediately preceding the promulgation of this Decree; (ex. Average harvest of 3 normal crop years is P150,000.00 x 2.5. Then, the value of the land would be P375,000.00) Note however that the phrase average harvest of (3) normal crop years can cause slight confusion to the common man. The phrase can be taken as, the average harvest of every year for 3 years totaled or the average harvest of 3 years all together.

 The total cost of the land, (including interest at (6)% per annum), shall be paid by the tenant in (15) years of (15) equal annual amortizations (ex. [(P375,000 000 + 6% interest per annum) / 15)] At current times, 15 years may be too long of a leeway to pay for the value of the land. As the value of a land would usually increase every year, especially with the developments an area would undertake, the full payment of the land value after 15 years would likely seem to defeat the concept of just compensation. The owner of the land should benefit as much as possible if not equally as the tenant-farmers. In cases of the default of payment of the tenant owners In case of default, the amortization due shall be paid by the farmers' cooperative in which the defaulting tenant-farmer is a member, with the cooperative having a right of recourse against him; The government shall guaranty such amortizations with shares of stock in governmentowned and government-controlled corporations; (To serve as security for the landowners and to prevent as much as possible, judicial proceedings for collection)

EXECUTIVE ORDER NO. 228 July 17, 1987 DECLARING FULL LAND OWNERSHIP TO QUALIFIED FARMER BENEFICIARIES COVERED BY PRESIDENTIAL DECREE NO. 27: DETERMINING THE VALUE OF REMAINING UNVALUED RICE AND CORN LANDS SUBJECT TO P.D. NO. 27; AND PROVIDING FOR THE MANNER OF PAYMENT BY THE FARMER BENEFICIARY AND MODE OF COMPENSATION TO THE LANDOWNER Provides that All qualified farmer beneficiaries are now deemed full owners (as of October 21, 1972) of the land they acquired by virtue of Presidential Decree No. 27. Also The valuation of rice and corn lands covered by P.D. No. 27 shall be based on the average gross production to be - determined by the Barangay Committee on Land Production in accordance with Department Memorandum Circular No. 26 - and related issuances and regulations of the Department of Agrarian Reform. The average gross production per hectare shall be - multiplied (2.5), the product of which shall be multiplied by P35.00 (the government support price for one cavan of 50 kilos of palay) - or P31.00 (the government support price for one cavan of 50 kilos of corn),

The amount arrived at shall be the value of the rice and corn land for the purpose of determining its cost to the farmer and compensation to the landowner. Here, the Executive order provides for another formula for the determination of land value. However, the formula is for the specific use of the valuation of rice and corn land. And instead of the variables being the average harvest, it provided for a computation per average gross production per hectare of land. This we find more efficient compared to the earlier formula as the later may bring about slight confusions while the former is more constant and concrete. Other provisions on the payment of compensation Lease rentals paid to the landowner by the farmer beneficiary after October 21, 1972, shall be considered as advance payment for the land dispute with the land owner regarding the amount of lease rental the Department of Agrarian Reform and the Barangay Committee on Land Production concerned shall resolve the dispute within thirty (30) days from its submission In the event a party questions in court the resolution of the dispute, the landowner's compensation claim shall still be processed for payment and the proceeds shall be held in trust by the Trust Department of the Land Bank pending the resolution of the dispute before the court

AUTHORITY OF THE DAR TO REVALUE PROPERTY - Section 16 (d) In case of rejection or failure to reply, the DAR shall conduct summary administrative proceedings to determine the compensation for the land requiring the landowner, the LBP and other interested parties to submit evidence as to the just compensation for the land, within fifteen (15) days from the receipt of the notice. After the expiration of the above period, the matter is deemed submitted for decision. The DAR shall decide the case within thirty (30) days after it is submitted for decision.

Section IV D of DAR Adm. Order No. 2, series 2009 (Valuation)

1. The compensation for lands covered under R.A. No. 9700 shall be: a) the amount determined in accordance with the criteria provided for in Section 7 of the said law and existing guidelines on land valuation; or b) the value based on the order of the DAR Adjudication Board (DARAB) or the regular court, which has become final and executory.

 The specific guidelines governing the valuation of lands under voluntary offer to sell (VOS) or compulsory acquisition (CA) pursuant to R.A. No. 6657, as amended by R.A. No. 9700 are provided in CARP-LAD Annex A of this Order. 2. All previously acquired lands wherein valuation is subject to challenge by landowners shall be completed and finally resolved pursuant to Section 17 of R.A. No. 6657, as amended. Claims over tenanted rice and corn lands under P.D. No. 27 and Executive Order (E.O.) No. 228 whether submitted or not to the Land Bank of the Philippines (LBP) and not yet approved for payment shall be valued under R.A. No. 6657, as amended. Landholdings covered by P.D. No. 27 and falling under Phase I of R.A. No. 9700 - shall be valued under R.A. No. 9700. 3. In cases of rejection, landowners may withdraw the original value of the landholding as determined by the Department of Agrarian Reform (DAR) and Land Bank of the Philippines (LBP) per Memorandum of Valuation (MOV) and subsequently deposited in their names, subject to their submission of the requirements for payment. ATESCc When the LO later accepts the original value or as recomputed by the LBP based on existing valuation guidelines, mere filing of a manifestation by the LO as regards the acceptance of the original value or a joint manifestation by the LO and the LBP on the recomputed value with the DAR Adjudication Board (DARAB) shall automatically terminate the just compensation case pending thereat. 4. Landowners, other than banks and financial institutions, who voluntarily offer their lands for sale, shall be entitled to an additional five percent (5%) cash payment. 5. For landholdings conveyed after the effectivity of R.A. No. 6657 - the LBP shall consider the transferor as the payee. Payment must be released to the LO-transferee if the LO-transferor issues a Special Power of Attorney (SPA) or Deed of Assignment in favor of the former. 6. In the determination of the Annual Gross Production (AGP), Selling Price (SP) and Cost of Operation (CO) to be used in the land valuation - the audited financial statement filed with the Bureau of Internal Revenue (BIR) shall be obtained by the DARMO from the LO fifteen (15) days prior to the date of field investigation. If the landowner fails to submit the same, the DAR and LBP may adopt applicable industry data or, in the absence thereof, conduct an industry study on the specific crop.

7. Small portions or patches within the covered landholdings which are determined to be less productive than the bigger portion during the conduct of joint field investigation shall be valued based on the current use of the adjacent portions, provided that said small portions or patches shall not exceed 10% of the productive area. Small portions or patches of landholdings above 18 percent slope, undeveloped and of no use to the landowner shall be valued as idle provided it shall not exceed 10% of the covered landholding.

LAND BANK OF THE PHILIPPINES, vs. HON. ELI G. C. NATIVIDAD, JOSE R. CAGUIAT represented by Attorneys-in-fact JOSE T. BARTOLOME and VICTORIO MANGALINDAN Facts: Private respondents filed a petition for the determination of just compensation for their agricultural lands which were acquired by the government pursuant to Presidential Decree No. 27 (PD 27). The court rendered the assailed Decision where the judgment was made in favor of the petitioners ordering the Department of Agrarian Reform (DAR) and the Land Bank of the Philippines (LBP) to pay these petitioners THIRTY PESOS (P30.00) per square meter, as the just compensation due for payment for same lands of petitioners. DAR and Land Bank filed separate motions for reconsideration which were denied 1996 for being pro forma as the same did not contain a notice of hearing. Land Bank consequently failed to file a timely appeal and the assailed Decision became final and executory. Land Bank argues that the failure of its counsel to include a notice of hearing due to pressure of work constitutes excusable negligence and does not make the motion for reconsideration pro forma. Land Bank assails that the private respondents should have sought the reconsideration of the DARs valuation of their properties thus failing to exhaust administrative remedies when they filed a petition for the determination of just compensation directly with the trial court. Land Bank also insists that the trial court erred in declaring that PD 27 and EO 228 are mere guidelines in the determination of just compensation. Issue: W/N P.D. 27 and/or E.O 228 is/are the proper basis in computing the just compensation for the land herein Held/Ratio: No. Procedural rules are designed to facilitate the adjudication of cases. Every case must be prosecuted in accordance with the prescribed procedure to ensure an orderly and speedy administration of justice. Contrary to allegations of petitioner, private respondents wrote a letter to the DAR Secretary objecting to the land valuation summary and requesting a conference for the purpose of fixing just compensation. The letter, however, was left unanswered. This prompted them to file petition directly with the trial. There is nothing contradictory between the DARs primary jurisdiction to determine and adjudicate agrarian reform matters and exclusive original jurisdiction over all matters involving the implementation of agrarian reform, which includes the determination of questions of just compensation. Primary jurisdiction is vested in the DAR to determine in a preliminary manner the just compensation for the lands taken under the agrarian reform program. Land Banks contention that the property was acquired for purposes of agrarian reform on October 21, 1972, the time of the effectivity of PD 27, ergo just compensation should be based on the value of the property as of that time and not at the time of possession in 1993, is erroneous. Under the factual circumstances of this case, the agrarian reform process is still

incomplete as the just compensation to be paid to private respondents has yet to be settled. Considering the passage of RA 6657 before the completion of this process, the just compensation should be determined and the process concluded under the said law. Indeed, RA 6657 is the applicable law, with PD 27 and EO 228 having only suppletory effect. It would certainly be inequitable to determine just compensation based on the guidelines provided by PD 27 and EO 228 considering the DARs failure to determine the just compensation for a considerable length of time. That just compensation should be determined in accordance with RA 6657, and not PD 27 or EO 228, is especially imperative considering that just compensation should be the full and fair equivalent of the property taken from its owner by the expropriator, the equivalent being real, substantial, full and ample.

JOSEFINA S. LUBRICA vs. LAND BANK OF THE PHILIPPINES, G.R. No. 170220. November 20, 2006. FACTS: Petitioner Josefina S. Lubrica is the assignee of Federico C. Suntay over certain parcels of agricultural land located at Sta. Lucia, Sablayan, Occidental Mindoro. In 1972, a portion of the said propert was placed under the land reform program pursuant to Presidential Decree No. 27 (1972) and Executive Order No. 228 (1987). The land was thereafter subdivided and distributed to farmer beneficiaries. The Department of Agrarian Reform (DAR) and the LBP fixed the value of the land at P5,056,833.54 which amount was deposited in cash and bonds in favor of Lubrica. Petitioners Nenita Suntay-Taedo and Emilio A.M. Suntay III inherited from Federico Suntay a parcel of agricultural land located at Balansay, Mamburao, Occidental consisting of two lots. Petitioners rejected the valuation of their properties, hence the Office of the Provincial Agrarian Reform Adjudicator (PARAD) conducted summary administrative proceedings for determination of just compensation. The PARAD fixed the preliminary just compensation but they were still not satisfied. LBP filed two separate petitions for judicial determination of just compensation before the Regional Trial Court of San Jose, Occidental Mindoro Petitioners filed separate Motions to Deposit the Preliminary Valuation Under Section 16(e) of Republic Act (R.A.) No. 6657 (1988)[9] and Ad Cautelam Answer praying among others that LBP deposit the preliminary compensation determined by the PARAD.

HELD: Petitioners were deprived of their properties without payment of just compensation which, under the law, is a prerequisite before the property can be taken away from its owners. The transfer of possession and ownership of the land to the government are conditioned upon the receipt by the landowner of the corresponding payment or deposit by the DAR of the compensation with an accessible bank. Until then, title remains with the landowner. Section 18 of R.A. No. 6657 - the LBP shall compensate the landowner in such amount as may be agreed upon by the landowner and the DAR and the LBP or as may be finally determined by the court as the just compensation for the land. In determining just compensation - the cost of the 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 nonpayment of taxes or loans secured from any government financing institution on the said land shall be considered as additional factors to determine its valuation.

Association of Small Landowners in the Philippines et. al., versus Secretary of Agrarian Reform , GR. No. 79310 , July 14, 1989 (175 SCRA 343) FACTS: The Secretary of the Department of Agrarian Reform offers bonds or shares for the lands of the petitioners being subjected to appropriation. Petitioners are inclined to receive monetary value for their land being appropriated. Contends that in appropriation proceedings, just compensation in the form of cash shall be given to the owners of the land. Issue: W/N the contention of the petitioners tenable Held: No. The SC held that the DAR has the discretion to make such offer.In Sec.16 of RA 6657, DAR may propose payment through bonds or shares alongside with cash in exchange for a land being appropriated. SC furthermore noted the revolutionary character of CARP law where payments is not always required to be made :fully in money

Land Bank vs. CA and Pedro Yap (GR No. 118712, Oct. 6, 1995)

 LBP appropriated the land owned by the private respondent. It opened a trust accounts in favor of the Pedro Yap in lieu of depositing cash or bonds. Pedro Yap contends that the TCT of his land was cancelled and named in favor of farmer beneficiaries even even before the full payment of just compensation. Issue: W/N opening of trust accounts in favor of Mr. Yap constitute just compensation. Held: No. The Supreme Court noted that in Sec 16 of RA 6657, it expressly states that just compensation shall be in a form of money or a bond. Nowhere it appears nor can be inferred that the payment can be made in other form (pertains to trust accounts). Also, cancellation of the landowners TCT shall only be valid after the full payment of just compensation.

Authority of the DAR Adjudication Board over land valuation cases. Article XIX of the 2009 DARAB Rules of Procedure First, its the duty of the Adjudi cation Board to see to it that the LBP and the DAR in their land valuation proceedings have complied with the administrative orders and other issuances of the Secretary of the DAR and LBP. Second, once the determination of the just compensation has been done, a notice of hearing shall be issued wherein the landowner, LBP and DAR officials will deliberate. The party who disagrees may contest the same with the Special Agrarian Court. If there will be no contest on the hearing, the decision shall be final and executory.