Case Digest: LBP vs Livioco GR No 170685

Case Digest: LBP vs Enrique Livioco 

GR No 170685                                                         September 22, 2010

Facts:

Livioco was the owner of a 30.6329 hectares sugarland. Sometime in 1987 to 1988 he offered his sugarland to the DAR for acquisition under the CARP at P 30.00 per square meter, for a total of P 9,189,870.00. The voluntary offer-to-sell form he submitted to the DAR indicated that his property is adjacent to residential subdivision and to an international paper mill.

LBP valuated the 26 hectares of such land for P 827,943.48 at P 3.21 per square meter. Livioco was promptly informed of the valuation and that the cash portion of the claim proceeds have been kept in trust pending his submission of the requirements. LBP did not act upon the notice given to him by both government agencies. Thereafter the LBP issued a certification to the ROD that it has earmarked the just compensation for Livioco's 26 hectares.

After 2 years, Livioco then  requested for a reevaluation of the compensation on the ground that its value had already increased from the time it was first offered for sale. The DAR denied the request for the sale was already perfected. DAR proceeded to take possession of the property and awarded CLOA's to 26 qualified beneficiaries. Livioco then filed a complaint to cancel the CLOA's and to recover his property and a petition for reconveyance which all led to futility.

Finally, Livioco filed a petition for judicial determination of just compensation contending that between 1900 and 2000, his property has become predominantly residential, hence he should be paid his property's value as such. LBP in its answer averred that they are justified in the P 3.21 per square meter valuation of the property on the ground that it was made pursuant to the guidelines in RA 6657 and DAR AO 3, LBP objected that his property should be valued as a residential land for the same was acquired for agricultural purposes, and not for its potential conversion to other use.

In the RTC, the decision rendered was that Livioco was able to prove the higher valuation of his property, hence, the valuation should be P 700.00 per square meter for the 24.2088 hectares of land and LBP cannot substantiate support its P 3.21 valuation by documentary evidences. The CA affirmed the decision of the RTC.

Issue:

What is the just compensation of Livioco's property?

Ruling:

The court ruled that, for purposes of just compensation, the fair market value of an expropriated property is determined by its character and its price at the time of taking. As to the character of the property it refers to its actual use at the time of the taking and not its potential uses. Therefore the property's character is agricultural; As to the price of the land Sec. 17 of RA 6657 should be considered. The evidence presented by Livioco was irrelevent to the factors under Sec. 17 of Ra 6657. 

Hence, both parties failed to adduce evidence of the property's value and an agricultural land at the time of the taking and is remanded to RTC for determination of just compensation.