Land Bank of the Philippines v. Herederos De Ciriaco Chunaco Destilleria, Inc.

FIRST DIVISION

[G.R. No. 196858. April 23, 2018.]

LAND BANK OF THE PHILIPPINES, petitioner, vs. HEREDEROS DE CIRIACO CHUNACO DESTILLERIA, INC., REPRESENTED BY ITSPRESIDENT, PAULOS T. CHUNACO, respondent.

NOTICE

Sirs/Mesdames :

Please take notice that the Court, First Division, issued a Resolution datedApril 23, 2018which reads as follows:

"G.R. No. 196858 (Land Bank of the Philippines v. Herederos De Ciriaco Chunaco Destilleria, Inc., represented by its President, Paulos T. Chunaco). — We resolve this petition for review on certiorari1 assailing the November 30, 2010 Decision 2 and May 11, 2011 Resolution 3 of the Court of Appeals (CA) in CA-G.R. SP. No. 94802. The CA reversed and set aside the October 5, 2005 4 and November 14, 2005 5 Orders of the Regional Trial Court (RTC) of Legazpi, Branch 3, acting as a Special Agrarian Court (SAC), in Agrarian Case No. 04-04.

Respondent domestic corporation Herederos De Ciriaco Chunaco Destilleria, Inc. owns 12 parcels of land (the properties) in Masarawag, Guinobatan, Albay, all of which were covered by the Comprehensive Agrarian Reform Program (CARP). 6 Sometime in November 2001, respondent voluntarily offered the properties for sale to the government. Petitioner Land Bank of the Philippines (LBP) valued them at P957,991.30. 7

Respondent disagreed with the valuation, prompting it to file a petition for preliminary valuation of properties before the Provincial Agrarian Reform Adjudicator (PARAD) of Albay. 8 In its Decision 9 dated February 17, 2004 (PARAD Decision), the PARAD, through Provincial Adjudicator Gil B. Baclig, set the value of the properties at P4,455,349.62. 10 The LBP moved for reconsideration which the PARAD denied in its Resolution 11 dated April 1, 2004 (PARAD Resolution).

Undaunted, the LBP filed a petition for determination of just compensation 12 with the SAC on April 12, 2004. The case was docketed as Agrarian Case No. 04-04. 13

In the meantime, respondent filed a motion for issuance of order of finality 14 of the PARAD Decision, which was granted in an Order 15 dated July 27, 2004. A writ of execution was issued on September 10, 2004. 16

On March 30, 2005, respondent filed its answer 17 before the SAC, alleging that the PARAD Decision already attained finality since the petition before the SAC was filed beyond the 15-day reglementary period. It thus prayed for the dismissal of the case on the ground of res judicata.

In its Order dated October 5, 2005, the SAC denied respondent's prayer for the dismissal of the case, to wit:

Finding, after the hearing of the motion, that the PARAD's resolution in question was not properly served upon Land Bank thus the decision did not attain finality, and considering that the Special Agrarian Court has the original and exclusive jurisdiction to hear just compensation cases under R.A. 6657 and likewise, considering the big difference in valuation rendered by PARAD as compared to Land Bank, the court resolves to DENY the Motion to Dismiss filed by the landowners for lack of merit.

SO ORDERED. 18 (Emphasis in the original.)

Respondent elevated the case to the CA via a petition for certiorari. 19 In its assailed Decision, the CA granted the petition and dismissed the case. The dispositive portion of its Decision reads:

WHEREFORE, the petition is GRANTED. The Orders of the Regional Trial Court of Legazpi, Branch 3 dated October 5, 2005 and November 14, 2005 are hereby, REVERSED and SET ASIDE. The petition docketed as Agrarian Case No. 04-04 before the Regional Trial Court of Legazpi, Branch 3 acting as a Special Agrarian Court is hereby ordered DISMISSED.

SO ORDERED. 20 (Emphasis in the original.)

Preliminarily, the CA rejected the LBP's contention that it was not duly served a copy of the PARAD Resolution. The CA declared that, based on record, the LBP received a copy of the Resolution on April 2, 2004, as reflected in the copy of the PARAD Resolution and admitted by LBP in its memorandum. 21

The CA also ruled that the LBP belatedly filed its petition before the SAC. It held that under Section 12, Rule VIII of the 1994 Department of Agrarian Reform Adjudication Board New Rules of Procedure (1994 DARAB Rules), a party may file a motion for reconsideration (MR) within 15 days from receipt of the decision of the PARAD Adjudicator. The filing of an MR suspends the running of the period within which to file an appeal. If the MR is denied, the movant shall have the right to perfect his appeal during the remainder of the period for appeal, reckoned from receipt of the resolution of denial. If the MR is granted and the decision is reversed, the aggrieved party shall have 15 days from receipt of the resolution of reversal to perfect his appeal.

The CA found that the LBP received the PARAD Decision on February 24, 2004. It filed an MR 14 days after or on March 9, 2004. 22 In case its MR is denied, the LBP only had a remaining period of two days to file a petition for the fixing of just compensation before the SAC. The PARAD denied the MR. The LBP received the PARAD Resolution on April 2, 2004. Thus, it only had until April 4, 2004 to file the petition with the SAC. However, it filed the petition on April 12, 2004 or eight days after the lapse of the reglementary period. By this time, the PARAD Decision had already attained finality. 23

The CA clarified that the fresh period rule enunciated in Neypes v. Court of Appeals24 is not applicable because the petition before the SAC is not considered an appeal from the PARAD's Decision, but an original action. The rule only applies to appeals from decisions of the courts of justice. 25

The LBP sought reconsideration but this was denied by the CA; hence this petition, raising the sole issue of whether the petition before the SAC was filed out of time.

We grant the petition.

The crux of the controversy is the time-limitation for filing a petition for determination of just compensation before the SAC. This is found in Section 11, Rule XIII, of the 1994 DARAB Rules, which reads:

RULE XIII

Appeals

xxx xxx xxx

Sec. 11. Land Valuation and Preliminary Determination and Payment of Just Compensation. — The decision of the Adjudicator on land valuation and preliminary determination and payment of just compensation shall not be appealable to the Board but shall be brought directly to the Regional Trial Courts designated as Special Agrarian Courts within fifteen (15) days from receipt of the notice thereof. Any party shall be entitled to only one motion for reconsideration. (Emphasis supplied, italics in the original.)

Pursuant to the foregoing, the action to file judicial determination of just compensation must be filed within 15 days from receipt of the Decision of the Provincial Adjudicator. However, in Land Bank of the Philippines v. Dalauta (Dalauta), 26 this Court held that the 15-day period provided in the DARAB Rules has no statutory basis. Republic Act No. 6657, or the CARP, itself does not provide for a period within which the petition for determination of just compensation may be filed before the SAC. The Court in Dalauta ruled that since the payment of just compensation is an obligation created by law, Article 1144 of the Civil Code of the Philippines applies. This Civil Code provision states that such actions must be brought within 10 years from the time the right of action accrues, or, specifically 10 years from the time the landowner receives a notice of coverage from the DAR.

We emphasized in Dalauta that the jurisdiction of the RTC, sitting as a SAC, is not appellate but original and exclusive. To require the courts to adjudge a petition for determination of just compensation dismissible for not having been filed within the 15-day period prescribed under the DARAB Rules reduces the SAC to merely an appellate review of the administrative decisions of the DAR.

While Dalauta involves an agricultural land subjected to compulsory acquisition under the CARP, we see no reason not to apply it in this case. The DAR also issues a notice of coverage to landowners who voluntarily offer their lands for sale to the government. Under DAR Administrative Order (AO) No. 2, series of 1996, 27 as amended by DAR AO No. 1, series of 1998, 28 the prevailing rule at the time respondent voluntarily offered its lands for sale to the government, the DAR Municipal Office (DARMO) shall conduct a "preliminary ocular inspection to determine initially whether or not the property may be covered under the CARP." If the property may be subject to CARP coverage, the DARMO sends the landowner a notice of coverage and field investigation together with a copy of the Ocular Inspection Report by personal delivery with proof of service or by registered mail with return card.

Here, the record is bereft of showing of when the respondent received a notice of coverage from the DARMO. Be that as it may, it is undisputed that respondent offered its lands for sale to the government sometime in November 2001, while the PARAD commenced summary administrative proceedings for the determination of just compensation on August 9, 2002. 29 Under AO No. 2, a notice of coverage is first issued before the LBP determines the valuation of the property. If the landowner rejects the valuation, the DARAB/PARAD is requested to conduct the administrative proceedings. It can be safely assumed then that the DARMO issued a notice of coverage between November 2001 and August 9, 2002. Thus, applying the 10-year period provided in Dalauta, the LBP has until 2012 to file a petition for determination of just compensation with the SAC.

In this case, LBP filed the petition for determination of just compensation on April 12, 2004. Following this Court's ruling in Dalauta, this Court finds that the LBP's petition was timely filed.

WHEREFORE, the petition is GRANTED. The November 30, 2010 Decision and May 11, 2011 Resolution of the Court of Appeals in CA-G.R. SP. No. 94802 are REVERSED and SET ASIDE. The October 5, 2005 Order of the Regional Trial Court of Legazpi, Branch 3, acting as a Special Agrarian Court in Agrarian Case No. 04-04 is hereby REINSTATED.

The case is REMANDED to the Special Agrarian Court for further proceedings with reasonable dispatch.

SO ORDERED." Sereno, C.J., on leave; De Castro, J., designated as Acting Chairperson of the First Division per Special Order No. 2540 dated February 28, 2018.

Very truly yours,

(SGD.) LIBRADA C. BUENADeputy Division Clerk of Court

 

Footnotes

1.Rollo, pp. 13-34.

2.Id. at 38-45. Penned by Associate Justice Priscilla J. Baltazar-Padilla with Associate Justices Fernanda Lampas Peralta and Manuel M. Barrios, concurring.

3.Id. at 46-47.

4.Id. at 127.

5. CA rollo, p. 66.

6. Republic Act No. 6657.

7.Rollo, p. 39.

8.Id.

9.Rollo, pp. 96-110.

10.Id. at 110.

11.Id. at 116-117.

12.Id. at 84-88.

13.Id. at 39.

14.Id. at 118-119.

15.Id. at 120-123.

16.Id. at 39.

17.Id. at 89-92.

18.Supra note 4.

19. CA rollo, pp. 3-14.

20.Rollo, p. 45.

21.Id. at 41.

22. February of that year was composed of 29 days.

23.Rollo, pp. 43-44. We note that the CA, in its assailed Decision, incorrectly counted the number of remaining days. Instead of two days, the LBP only had one day within which to file the petition before the SAC.

24. G.R. No. 141524, September 14, 2005, 469 SCRA 633.

25.Rollo, pp. 44-45.

26. G.R. No. 190004, August 8, 2017.

27. Revised Rules and Regulations Governing the Acquisition of Agricultural Lands Subject of Voluntary Offer to Sell and Compulsory Acquisition Pursuant to Republic Act No. 6657.

28. Amendments to Administrative Order No. 2, Series of 1996, Entitled, "Revised Rules and Procedures Governing the Acquisition of Agricultural Lands Subject of Voluntary Offer to Sell and Compulsory Acquisition Pursuant to Republic Act No. 6657."

29. Records, Vol. I, p. 29.