G.R. No. 183688, Aug. 18, 2010,
628 SCRA 454 (2010)
Respondents, Barrido are registered owners of a parcel of land situated in Barangay Apologista, Sara, Iloilo.On April 30, 2003, the government expropriated a portion of the property under the Land Reform Program.
Petitioner offered respondents a total amount of ₱60,385.49 as just compensation, but respondents rejected the offer. Respondents instituted an original action before the Regional Trial Court for the judicial determination of just compensation.
RTC adopted a different formula in determining land valuation by considering the average between the findings of the DAR using the formula laid down in E.O. 228 and the market value of the property as stated in the tax declaration.
Whether or not Court of Appeals committed serious errors of law when it affirmed the said decision and order of the trial court that fixed the just compensation which is not in accordance with the provisions of R.A. No. 6657 as translated into a basic formula under DAR Administrative Order NO. 5, Series of 1998.
YES. While the determination of just compensation is essentially a judicial function vested in the RTC acting as a Special Agrarian Court, the judge cannot abuse his discretion by not taking into full consideration the factors specifically identified by law and implementing rules. Special Agrarian Courts are not at liberty to disregard the formula laid down in DAR A.O. No. 5, series of 1998, because unless an administrative order is declared invalid, courts have no option but to apply it. The courts cannot ignore, without violating the agrarian law, the formula provided by the DAR for the determination of just compensation.