FIRST DIVISION
[CA-G.R. CV No. 60529. December 20, 2000.]
TOMAS R. LEONIDAS, plaintiff-appellant, vs. LAND BANK OF THE PHILIPPINES, defendant-appellant.
D E C I S I O N
DACUDAO, J p:
Plaintiff-appellant has appealed from the Decision 1 of the Regional Trial Court (RTC) of Iloilo City, Branch 34, dated January 18, 1998, directing defendant-appellee Land Bank of the Philippines (LBP) to pay him only the total sum of P621,688.00, representing just compensation for his expropriated property consisting of 31.0844 hectares under the Comprehensive Agrarian Reform Program (CARP) of the government. For reasons to be hereunder discussed, plaintiff-appellant believes that he ought to receive much more than the valuation arrived at by defendant-appellee LBP.
As fount by the court a quo, the salient facts are summarized, thusly:
"The plaintiff alleged that he is the only child of the deceased Spouses Ponciano C. Leonidas and Asuncion Roxas Leonidas. The said spouses were the registered owners of a parcel of land which was covered by OCT No. O-10996 and consisting of 310,844 square meters or 31.0844 hectares located at Polopina Island, Concepcion, Iloilo. Sometime in the 1980's in an undated CARP (VOS) Form No. 1 Ponciano C. Leonidas voluntary [sic] offered to sell to the Republic of the Philippines the parcel of land subject of this case. On September 3, 1991, defendant Land Bank of the Philippines approved for payment the amount of P282,670.29 corresponding to the value of the only 14.1604 hectares. The defendant Land Bank of the Philippines rejected the area of 16.9240 hectares as unsuitable for expropriation. On October 16, 1993, Ponciano Leonidas, through counsel rejected the valuation of the 14.1604 hectare in the amount of P282,670.20 as too low and unrealistic. On December 19, 1991, unknown to Ponciano Leonidas, a new Transfer Certificate of Title No. CLOA T-209 was issued to 21 beneficiaries covering the whole 31.0844 hectares. Since then the beneficiaries named in TCT CLOA has [sic] been in possession of the land.
"Considering the rejection of the valuation of the property, the claim folder of the VOS was sent to the Adjudication Board of the Department of Agrarian Reform, Region VI, Iloilo City for the fixing of compensation. Since by this time both spouses were already dead, they were substituted by Tomas Leonidas before the Adjudication Board. The said Adjudication Board adopted the valuation of the property subject of this case." 2
Dissatisfied with the decision of the Provincial Agrarian Reform Adjudicator (PARAD) of Iloilo, plaintiff-appellant instituted against LBP and the Department of Agrarian Reform (DAR) before the RTC of Iloilo City, Branch 27, a complaint for the final valuation and determination of the just compensation of the total area subject of this case, consisting of an aggregate land area of 31.0844 hectares, the totality of the land actually taken by the government.
On January 27, 1998, the RTC rendered judgment, the dispositive portion whereof reads as follows:
"WHEREFORE, in view of the foregoing, the defendant Land Bank of the Philippines is hereby ordered to pay the plaintiff Tomas R. Leonidas the amount of P20,000.00 per hectare for 31.0844 hectares or the total amount of P621,688.00 for the property expropriated with interest of 12% per annum from December, 1991 until the entire amount shall have been paid." 3
Aggrieved by the above disposition, especially with respect to the valuation of the land and improvements introduced thereon, plaintiff-appellant interposed the instant appeal. On the part of DAR, it initially filed with the RTC a notice of appeal 4 dated February 5, 1998. However, it failed to prosecute the same within the prescribed period. Thus, we declared abandoned DAR's appeal in our September 28, 2000 Resolution. 5 Plaintiff-appellant's brief was with this Court filed on April 27, 1999, while that of the defendant-appellee LBP, on July 8, 1999.
Meanwhile, on October 5, 1999, plaintiff-appellant filed a motion for execution pending appeal on a trinity of grounds, to wit: (1) the RTC decision had become final and executory; (2) he had been unjustly deprived of the enjoyment of his property for a considerable length of time and the appeal would most likely prolong such deprivation; (3) considering his advanced age, he might not live long enough to enjoy the fruits of the judgment in this case. On December 16, 1999, defendant-appellee filed its Comment thereon. 6
Per Resolution 7 dated January 7, 2000, this Court 8 favorably acted on the motion and ordered the issuance of a writ of execution. 9 The corresponding writ 10 was issued on January 11, 2000.
On March 6, 2000, defendant-appellee LBP filed an Urgent Motion, 11 praying the Sheriff Divinagracia's (who served the writ) demand that the writ of execution dated January 11, 2000 be satisfied fully in cash, and that the levy he made upon LBP's personal property (Nissan Power Eagle Pick-up), be declared invalid, and that a temporary restraining order (TRO)/preliminary injunction issue restraining him from further proceeding with the sale of the said personal property of LBP which was scheduled on March 16, 2000, and from enforcing the writ of execution against the corporate properties of LBP. Plaintiff-appellant filed his Comment 12 to the Urgent Motion.
On April 10, 2000, this Court issued a Resolution 13 granting defendant-appellee's application for a TRO. Accordingly, Sheriff Camilo P. Divinagracia, or any one who would take his place, was restrained from proceeding with the sale of the Nissan Power Eagle pick-up of the LBP.
In the present recourse, plaintiff-appellant faults the court a quo, thusly: (1) In giving a uniform valuation of P20,000.00 per hectare to the land and its improvements; and (2) In holding that the fair market value of the land and its improvements shall be reckoned from the date of its actual taking on December 19, 1991.
Plaintiff-appellant contends that the Trial Court committed a reversible error in using a uniform factor for determining just compensation, in light of the fact that the evidence duly established showed that there were definite and tangible improvements introduced on the land, viz., 2,500 coconut trees, 100 bamboo grooves/clumps/clusters/, Ipil-ipil trees erected on a land area covering 2.9250 hectares; and that in addition to these improvements, about 2.9250 hectares of the property are planted to Ipil-ipil; about 1.870 hectares is riceland. Accordingly to plaintiff-appellant, the value of these improvements cannot simply be ignored since a component part of just compensation is the value of improvements, crops and trees standing thereon; 14 and that since defendant-appellee has disagreed with plaintiff-appellant's valuation, it should have submitted countervailing evidence in support of what it considered the correct valuation therefore, but that as things stood, neither the LBP nor the DAR, proffered some such evidence to overthrow those presented by herein plaintiff-appellant.
Plaintiff-appellant also challenges the Trial Court's use of the zonal values and tax assessments as bases for estimating the fair market value of the property and its improvements.
Moreover, plaintiff-appellant asserts that since the DAR failed to observe the legal requirements for valid expropriation, that is, deposit by the DAR through the LBP of the offered valuation, resulting in his illegal dispossession and ownership of the subject property, the defendant-appellee ought to be held liable for the income, of which he has been deprived starting December 19, 1991, until the just compensation shall have been fully settled.
The appeal is partly meritorious.
Succinctly put, just compensation means the price equivalent to the fair market value of an expropriated property. Market value in legal parlance is the price fixed by the buyer and seller in the open market in the usual course of legal trade and competition; the price and value of the article established or shown by sale, public or private, in the ordinary way of business; the fair value of property as between one who desires to purchase and one who desires to sell; the current price; the general or ordinary price for which property may be sold in that locality. 15 In addition, RA 6657, otherwise known as the Comprehensive Agrarian Reform Law, provides for the determination of just Compensation of agricultural lands covered by the agrarian reform program, thusly:
"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 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." (Emphasis supplied)
Against the foregoing statutory and jurisprudential backdrop, we are called upon to adjudicate whether the compensation adjudged by the court a quo qualifies as just and adequate. EHCaDS
After a scrupulous review of the records, we are convinced that the Trial Court committed a reversible error in its precipitate determination of the supposed just compensation of the property covered under the agrarian reform program. It is undisputed that the Trial Court based its determination on the assessed and zonal values sourced from the Provincial Assessor's Office. However, there is no gainsaying the fact that assessed values, whilst helpful in arriving at a fair valuation of a property, cannot be made the overriding consideration, and principally and chiefly because it normally constitutes only a percentage of the current fair market value of the land. 16. Moreover, RA 6657 ordains that just compensation shall be based on a host of factors, amongst which are the following: the cost of acquisition of the land, 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. In the instant case, it appears that, apart from the zonal valuation and tax assessments, the other vital determinants were brushed aside in computing the just compensation. Indubitably, various factors come into play in the valuation of specific properties singled out for expropriation. In the landmark case of EPZA v. Dulay, 17 the Supreme Court declared:
"The values given by provincial assessors are usually uniform for very wide areas covering several barrios or even an entire town with the exception of the poblacion. Individual differences are never taken into account. The value of land is based on such generalities as its possible cultivation for rice, corn, coconuts, or other crops. Very often land described as 'cogonal' has been cultivated for generations. Buildings are described in terms of only two or three classes of building materials and estimates of areas are more often inaccurate than correct. Tax values can serve as guides but cannot be absolute substitutes for just compensation."
Indeed, it is precisely because the Trial Court palpably failed to take into account the peculiarities of the land in question and its improvements that its determination is highly objectionable. Its uniform valuation per hectare dramatically collides with the aforecited holding of the Supreme Court.
Upon the other hand, we are not prepared to accept at face value plaintiff-appellant's submission as to the just compensation of his expropriated property. While it is true that defendant-appellee failed to adduce countervailing evidence, plaintiff-appellant's claim regarding the fair market value of his land as well as its improvements, cannot be given much weight because of lack of solid evidentiary support. By now it almost trite to say that the party alleging has the burden of substantiating his allegation by preponderance of evidence, and any declaration or assertion not so substantiated is, at best, a self-serving statement or declaration, which is inadmissible in evidence for being hearsay. 18 Indeed, plaintiff-appellant, although concededly competent to testify as to the value of his land and its improvements as held by decisional laws, has not really discharged this burden of proving his claims beyond the realm of self-indulgent allegations.
Since plaintiff-appellant, as landowner, and defendant-appellee are in sharp disagreement on the question of just compensation of the expropriated property, and since there is dearth of evidence upon which this Court can erect a judicious finding of just compensation, we are perforce constrained to refer this matter of just compensation to court appointed commissioners who shall act in accordance with Sections 5, 6, 7 and 8 of Rule 67, of the 1997 Rules of Civil Procedure. These disinterested persons should be able to assist the Trial Court in arriving at the correct, just and equitable valuation of the property expropriated.
The next issue to be addressed is the reckoning period of the taking. In this connection, the case of Land Bank of the Philippines v. Court of Appeals 19 is highly instructive. Said the Supreme Court in this case:
"Section 16 (e) of Republic Act 6657 was very specific in limiting the type of deposit to be made as compensation for the rejecting landowners, that is, in 'cash' or in 'LBP bonds,' to wit:
'Sec. 16. Procedure for Acquisition of Private Lands —
xxx xxx xxx
'(e) Upon receipt by the landowner of the corresponding payment or, in case of rejection or no response from the landowner, upon the deposit with an accessible bank designated by the DAR of the compensation in cash or in LBP bonds in accordance with this Act, the DAR shall take immediate possession of the land and shall request the proper Register of Deeds to issue a Transfer Certificate of Title (TCT) in the name of the Republic of the Philippines. . . .' (Emphasis supplied)
"The provision is very clear and unambiguous, foreclosing any doubt as to allow an expanded construction that would include the opening of 'trust accounts' within the coverage of the term 'deposit.' Accordingly, we must adhere to the well-settled rule that when the law speaks in clear and categorical language, there is no reason for interpretation or construction, but only for application. Thus, recourse to any rule which allows the opening of trust accounts as a mode of deposit under Section 16(e) of RA 6657 goes beyond the scope of the said provision and is therefore impermissible." 20
Given the foregoing pronouncement, it is evident enough that the operating procedures of the DAR allow the taking of possession of expropriated property only when, after rejection by the landowner, the DAR through the LBP shall have deposited the offered valuation of such property in cash or in LBP bonds. However, the records showed that what LBP deposited in the name of plaintiff-appellant, per its letter dated December 10, 1991, were trust accounts, 21 which, as explained in Land Bank, supra, do not satisfy the legal requirement. Nevertheless, LBP subsequently presented in evidence Land Bank Bond numbered 0061206 22 issued on November 5, 1991 and maturing on November 5, 2000 in the principal sum of One Hundred Sixty Nine Thousand Six Hundred Two and Seventeen Centavos (P169,202.17/100), which, upon maturity of 80% thereof, plaintiff-appellant received in cash, per acknowledgment receipt 23 dated January 26, 2000. On record also is another LBP Bond numbered 0061207 in the principal sum of Two Hundred Three Thousand Four Hundred Ten and Sixty Three Centavos (P203,410.63). With that, it can be said that the taking of plaintiff-appellant's property on December 19, 1991 did not violate the CARP Law, for the LBP Bond was dated November 5, 1991, or even before the date of actual taking. In this context, we hold that the valuation of the expropriated property was properly based on values then prevailing in 1991.
IN VIEW OF THE FOREGOING, judgment is rendered remanding this case to the Trial Court, which shall forthwith appoint commissioners in accordance with Rule 67 of the 1997 Rules of Civil Procedure, for the purpose of determining just compensation.
Without costs in this instance.
SO ORDERED.
Montoya and Adefuin-De La Cruz, JJ., concur.
Footnotes
1. Per Hon. Julio L. Villanueva, in Civil Case No. 22172.
2. RTC Decision, p. 1-2, Rollo, pp. 33-34.
3. Ibid., p. 3, Rollo, p. 35.
4. Principal Records, p. 116.
5. Rollo, p. 250.
6. Rollo, pp. 84-87.
7. Rollo, p. 83.
8. Per Associate Justice Hilarion L. Aquino, with the concurrence of Associates Justices Martin S. Villarama and Elvi John S. Asuncion, Members, Special Eighth Division.
9. Rollo, pp. 81-82.
10. Rollo, pp. 81-82.
11. Rollo, pp. 95-110.
12. Rollo, pp. 139-142.
13. Rollo, p. 144.
14. Citing Manila Railroad Co. v. Attorney-General, 41 Phil. 163; Philippine Executive Commission v. Estrella, 52 O.G. 773; Manila Railroad Co. v. Aguilar, 25 Phil. 118.
15. Joaquin G. Bernas, S.J., The 1987 Constitution of the Republic of the Philippines, A Commentary, 1996 ed., p. 352: citing Province of Tayabas v. Perez, 66 Phil. 467, 469; Manila Railroad Co. v. Velazquez, 32 Phil. 286, 313-14; City of Manila v. Estrada, 25 Phil. 208, 234; Manila Railroad Co. v. Fabie, 17 Phil. 206, 208; City of Manila v. Corrales, 32 Phil. 85, 92, 98.
16. Robern Development Corp. v. Quintain, 315 SCRA 171, citing Daet v. Court of Appeals, 93 SCRA 503, 525.
17. 149 SCRA 315.
18. Victory Liner, Inc. v. Court of Appeals, 293 SCRA 378, citing Catapusan v. Court of Appeals, 264 SCRA 450; Ricardo J. Francisco, Handbook on Evidence, 1984 edition, p. 124.
19. 258 SCRA 404.
20. Ibid, p. 406-407 citing Songco v. NLRC, 183 SCRA 610, 616 citing Cebu Portland Cement Co. v. Municipality of Naga, 24 SCRA 708; Gonzaga v. Court of Appeals, 51 SCRA 381.
21. Rollo, pp. 61-62.
22. Rollo, p. 115.
23. Rollo, p. 120.