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click here for freelancing tutoring sitesTHIRD DIVISIONLAND BANK OF THEPHILIPPINES,Petitioner,- versus KUMASSIE PLANTATION COMPANY INCORPORATED,Respondent.x-----------------------------------xKUMASSIE PLANTATION COMPANY INCORPORATED,Petitioner,- versus-LAND BANK OF THEPHILIPPINESand THE SECRETARY OF THE DEPARTMENT OF AGRARIAN REFORM,Respondents.G.R. No. 177404G.R. No. 178097Present:YNARES-SANTIAGO,J.,Chairperson,CHICO-NAZARIO,VELASCO, JR.,NACHURA, andPERALTA,JJ.Promulgated:June 25, 2009

x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -xD E C I S I O NCHICO-NAZARIO,J.:Before Us are two consolidated Petitions for Review onCertiorariunder Rule 45 of the Rules of Court,[1]docketed asG.R. No. 177404andG.R. No. 178097, assailing the Decision,[2]dated24 November 2005, and Resolution,[3]dated30 March 2007, of the Court of Appeals in CA-G.R. CV No. 65923.The undisputed facts are as follows:Kumassie Plantation Company Incorporated (KPCI) is the registered owner of 802.2906 hectares of agricultural land situated in Basiawan, Santa Maria, Davao del Sur, and covered by Transfer Certificate of Title (TCT) No.646.[4]In 1982, KPCI and Philippine Cocoa Corporation (PCC) entered into a contract of lease whereby the former agreed to lease the said land together with the improvements thereon to the latter for a period of 25 years beginning15 May 1982.[5]Subsequently, PCC executed a deed of assignment transferring all its rights as lessee under the said contract of lease to Philippine Cocoa Estates Corporation (PCEC) effective31 December 1983.[6]On 18 February 1992, a portion of the aforementioned land, measuring 457.9952 hectares, planted with coconuts and cocoa (subject land), was compulsorily acquired by the Department of Agrarian Reform (DAR), Region XI, Davao City, for distribution to farmer-beneficiaries pursuant to Republic Act No. 6657, otherwise known as the Comprehensive Agrarian Reform Law of 1988.[7]The DAR then requested the Land Bank of the Philippines (LBP) to determine the value of the subject land.[8]LBP pegged the value of the subject land atP19,140,965.00 or equivalent toP41,792.94 per hectare.[9]DAR offered to KPCI said amount as compensation for the subject land,[10]but it was rejected by KPCI for being unreasonably low.[11]Despite the rejection by KPCI of the valuation of the subject land by LBP, the amount ofP19,140,965.00 was deposited by LBP, upon the instructions of DAR, in the name and for the account of KPCI.[12]KPCI withdrew from LBP the entire amount in cash and bonds.[13]DAR then advised the Department of Agrarian Reform Adjudication Board (DARAB), on27 July 1994, to conduct a summary administrative proceeding for the determination of the just compensation due KPCI for the subject land.[14]The proceeding was docketed as DARAB Case No. JC-R-XI-DAV-OR-0017-CO.LBP and KPCI later submitted their respective position papers with the DARAB.[15]DAR next directed the Register of Deeds of Digos, Davao del Sur, on26 September 1994, to cancel TCT No. 646 covering the subject land in the name of KPCI and to issue a new TCT in the name of the Republic of thePhilippines.[16]After the issuance of a new TCT in the name of the Republic of thePhilippines, and again upon the request of the DAR, the Register of Deeds of Digos, Davao del Sur, issued Certificates of Land Ownership Award (CLOAs) to qualified farmer-beneficiaries.[17]On20 January 1997, KPCI filed with the Davao City Regional Trial Court (RTC), Branch 15 (acting as aSpecial Agrarian Court), a Complaint against LBP and the DAR for determination and payment of just compensation, docketed as Civil Case No. 25,045-97.[18]KPCI implored the RTC to render judgment fixing the just compensation for the subject land atP160,000.00 per hectare, or equivalent to a total amount ofP73,279,232.00, less the amount ofP19,140,965.00 which KPCI had previously withdrawn from LBP.[19]Subsequently, LBP and the DAR filed with the RTC their respective Answers contending that the Complaint was prematurely filed as KPCI failed to exhaust administrative remedies; that KPCI was already paid just compensation for the subject land, determined to beP41,792.94 per hectare, for a total amount ofP19,140,965.91; and that KPCI admitted in the Complaint having received such amount from LBP. LBP asserted that it correctly calculated the value of the subject land to beP19,140,965.91, applying the formula prescribed in DAR Administrative Order (DAO) No. 6, Series of 1992, as amended by DAO No. 11, Series of 1994.At the end of their respective Answers, both LBP and DAR sought the dismissal of the Complaint of KPCI.[20]The RTC thereafter directed the parties to submit the names of their respective nominees for commissioners in Civil Case No. 25,045-97.[21]KPCI nominated Oliver A. Morales (Morales), President of Cuervo Appraisers Incorporated,[22]while LBP submitted the name of a certain Engineer Romeo Cabanial.[23]For its part, the DAR endorsed Tomasa L. Miranda (Miranda), a DAR employee.[24]The RTC appointed Morales and Miranda as commissioners.The two subsequently took their oaths of office as court-appointed commissioners.[25]Meanwhile, the DARAB issued, on19 May 1997, a Resolution in JC-R-XI-DAV-OR-0017-CO, affirming the valuation of the subject land by the LBP.[26]The DARAB found the LBP valuation of the subject land to be accurate and just, as it was in harmony with the pertinent provisions of Republic Act No. 6657 and DAO No. 6, Series of 1992, as amended.[27]After trial in Civil Case No. 25,045-97, the RTC rendered its Decision on18 February 1999, fixing the fair and reasonable value of the subject land atP100,000.00 per hectare.In arriving at said valuation, the RTC considered the location of the subject land, the nature of the trees planted thereon, and the reasons stated in Morales appraisal report.The RTC then ordered LBP and DAR to pay KPCI an amount equivalent toP100,000.00 per hectare as just compensation for the subject land, plus legal interest computed from23 March 1994until fully paid.[28]LBP filed with the RTC a Motion for Reconsideration of the foregoing Decision;[29]while DAR filed a Notice of Appeal, manifesting that it would appeal said RTC Decision to the Court of Appeals.[30]On23 July 1999, the RTC issued an Order denying the Motion for Reconsideration of LBP.[31]Aggrieved, LBP filed its appeal with the Court of Appeals, docketed as CA-G.R CV No. 65923.[32]LBP filed, on27 September 2000, its Appellants Brief in CA-G.R CV No. 65923.[33]DAR joined the appeal of LBP by filing, on18 January 2001, in CA-G.R CV No. 65923, a Manifestation adoptingin totothe Appellants Brief of LBP.[34]On24 November 2005, the Court of Appeals promulgated its Decision in CA-G.R CV No. 65923, affirming with modification the appealed RTC Decision. The appellate court sustained the finding of the RTC that the fair and reasonable value of the subject land wasP100,000.00 per hectare.Nevertheless, it ruled that the imposition of legal interest should be deleted, as there was no delay on the part of LBP in depositing the amount ofP19,140,965.91 in the account of KPCI, which amount was admittedly withdrawn by KPCI.Thefalloof the Decision of the Court of Appeals reads:WHEREFORE, premises considered, the Decision of the Regional Trial Court (RTC), 11thJudicial Region, Br. 15,DavaoCityisAFFIRMED with MODIFICATION. As modified, as none should be awarded, the award of interest is deleted.No costs.[35]LBP and KPCI each filed its own Motion for Reconsideration of the24 November 2005Decision of the Court of Appeals,[36]but both Motions were denied by the appellate court in its Resolution dated30 March 2007.Hence, LBP and KPCI separately sought recourse from this Court by virtue of the Petitions for Review presently before us, docketed asG.R. No. 177404andG.R. No. 178097,respectively.The two Petitions were consolidated since they arose from the same set of facts.[37]The procedure for the determination of compensation cases under Republic Act No. 6657, as devised by this Court,[38]commences with the valuation by the LBP of the lands taken by the State from private owners under the land reform program.Based on the valuation of the land by the LBP, the DAR makes an offer to the landowner through a written notice.In case the landowner rejects the offer, a summary administrative proceeding is held and, afterwards, depending on the value of the land, the Provincial Agrarian Reform Adjudicator (PARAD), the Regional Agrarian Reform Adjudicator (RARAD), or the DARAB, fixes the price to be paid for the said land.If the landowner still does not agree with the price so fixed, he may bring the matter to the RTC, acting asSpecial Agrarian Court.In the process of determining the just compensation due to landowners, it is a necessity that the RTC takes into account several factors enumerated in Section 17 of Republic Act No. 6657, as amended, to wit:Sec. 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 assessorsshall be considered. Thesocial and economic benefitscontributed by the farmers and the farmworkers and by the Government to the property as well as thenon-payment of taxes or loanssecured from any government financing institution on the said land shall be considered as additional factors to determine its valuation.Being the government agency primarily charged with the implementation of the agrarian reform program, DAR issued DAO No. 6, Series of 1992, as amended, filling out the details necessary for the implementation of Section 17 of Republic Act No. 6657.DAR translated the factors specified in Section 17 of Republic Act No. 6657, into a basic formula, presented as follows in DAO No. 6, Series of 1992, as amended:LV= (CNI x 0.6) + ( CS x 0.3) + (MV x 0.1)Where:LV= Land ValueCNI = Capitalized Net IncomeCS = Comparable SalesMV = Market Value per Tax DeclarationThe above formula shall be used if all the three factors are present, relevant, and applicable.A.1 When the CS factor is not present and CNI and MV are applicable, the formula shall be:LV= (CNI x 0.9) + (MV x 0.1)A.2 When the CNI factor is not present, and CS and MV are applicable, the formula shall be:LV= (CS x 0.9) + (MV x 0.1)A.3 When both the CS and CNI are not present and only MV is applicable, the formula shall be:LV= MV x 2In its Petition docketed asG.R. No. 177404, LBP maintains that the RTC and the Court of Appeals erred in their valuation of the subject land atP100,000.00 per hectare because both courts did not consider the factors enumerated in Section 17 of Republic Act No. 6657 and the formula for valuation of lands under DAO No. 6, Series of 1992, as amended.[39]While the determination of just compensation is essentially a judicial function which is vested in the RTC acting as Special Agrarian Court, we, nonetheless, disregarded the determination of just compensation made by the RTC inLand Bank of the Philippines v. Banal,[40]Land Bank of the Philippines v. Celada,[41]and inLand Bank of the Philippines v. Lim,[42]when, as in this case, the judge gravely abused his discretion by not taking into full consideration the factors specifically identified by law and implementing rules.In several cases, we have reminded the special agrarian courts to resolve just determination cases judiciously and with utmost observance of Section 17 of Republic Act No. 6657 and the administrative orders issued by the DAR to implement said statutory provision.InLand Bank of the Philippines v. Banal,[43]we emphasized that the factors laid down in Section 17 of Republic Act No. 6657 and the formula stated in DAO No. 6, Series of 1992, as amended, must be adhered to by the RTC in fixing the valuation of lands subjected to agrarian reform, thus:In determining just compensation, theRTC is requiredto consider several factors enumerated in Section 17 of R.A. 6657, as amended, thus:x x x xThese factors have been translated into a basic formula in [DAO 6-92], as amended by [DAO 11-94], issued pursuant to the DARs rule-making power to carry out the object and purposes of R.A. 6657, as amended.x x x xWhile the determination of just compensation involves the exercise of judicial discretion, however, such discretion must be discharged within the bounds of the law.Here, the RTC wantonly disregarded R.A. 6657, as amended, and its implementing rules and regulations. ([DAO 6-92], as amended by [DAO 11-94]).x x x xWHEREFORE, x x x.The trial judge is directedto observe strictly the procedures specified abovein determining the proper valuation of the subject property. (Emphasis ours.)Again, inLand Bank of the Philippines v. Celada,[44]we stressed that the special agrarian court cannot ignore, without violating Republic Act No. 6657, the formula provided by the DAR for the determination of just compensation. We rejected the valuation fixed by the RTC because it failed to follow the DAR formula:While [Special Agrarian Court] is required to consider the acquisition cost of the land, the current value of like properties, its nature, actual use and income, the sworn valuation by the owner, the tax declaration and the assessments made by the government assessors to determine just compensation, it is equally true that these factors have been translated into a basic formula by the DAR pursuant to its rule-making power under Section 49 of R.A. No. 6657.As the government agency principally tasked to implement the agrarian reform program, it is the DARs duty to issue rules and regulations to carry out the object of the law.[DAO] No. 5, s. of 1998 precisely filled in the details of Section 17, RA No. 6657 by providing a basic formula by which the factors mentioned therein may be taken into account.The [Special Agrarian Court] was at no liberty to disregard the formula which was devised to implement the said provision.It is elementary that rules and regulations issued by administrative bodies to interpret the law which they are entrusted to enforce, have the force of law, and are entitled to great respect.Administrative issuances partake of the nature of a statute and have in their favor a presumption of legality.As such, courts cannot ignore administrative issuances especially when, as in this case, its validity was not put in issue.Unless an administrative order is declared invalid, courts have no option but to apply the same. (Emphasis ours.)Instead, we sustained the valuation made by the LBP, which was patterned after the applicable administrative order issued by the DAR,viz:[LBP] arrived at its valuation by using available factors culled from the Department of Agriculture and Philippine Coconut Authority, and by computing the same in accordance with the formula provided, thus COMPUTATION (Applicable Formula):LV= 0.90 CNI + 0.10 MVComparable Land Transactions (Px x x x ____ ) =P x-x-xCapitalizedNet Income:Cassava16,666.67 x 0.90 =15,000.00 Corn/Coco 26,571.70 = 23,914.53Market ValueCassava8,963.78 x 0.10= 896.38per Tax Declaration: Corn/Coco10,053.93 = 1,005.39Computed Value perHectare:Cassava15,896.38; Corn/Coco 24,919.92x x x xValue per hectare used: Cassava 15,896.38x6.0000 has. =95,378.28Corn/Coco24,919.92x8.1939 has.= 204,191.33Payment due to LO :P299, 569.61The above computation was explained by Antero M. Gablines, Chief of the Claims, Processing, Valuation and Payment Division of theAgrarianOperationsCenterof the Land Bank, to wit:ATTY. CABANGBANG: (On direct):x x x xq.What are the items needed for the Land Bank to compute?a.In accordance with Administrative Order No. 5, series of 1998, the value of the land should be computed using the capitalized net income plus the market value. We need the gross production of the land and its output and the net income of the property.q.You said gross production.How would you fix the gross production of the property?a. In that Administrative Order No. 5, if the owner of the land is cooperative, he is required to submit the net income. Without submitting all his sworn statements, we will get the data from the DA (Agriculture) or from the coconut authorities.x x x xq. In this recommended amount which you approved, how did you arrive at this figure?a. We used the data from the Philippine (Coconut) Authority and the Agriculture and the data stated that Cassava production was only 10,000 kilos per hectare; corn, 2,000 kilos; and coconuts, 15.38 kilos per hectare. The data stated that in the first cropping of 1986, the price of cassava wasP1.00 per kilo; corn was sold atP7.75 per kilo; and the Philippine Coconut Authority stated that during that time, the selling price of coconuts wasP8.23 per kilo.q. After these Production data and selling price, there is here a cost of operation, what is this?a. It is the expenses of the land owner or farmer. From day one of the cultivation until production. Without the land owners submission of the sworn statement of the income, production and the cost, x x x Administrative Order No. 5 states that x x x we will use 20% as the net income, meaning 80% of the production in peso. This is the cost of valuation.q. 80 % for what crops?a. All crops except for coconuts where the cost of expenses is only 20%.q. Summing all these data, what is the value per hectare of the cassava?a. The cassava isP15,896.38.q. How about the corn x x x intercropped with coconuts?a.P24,919.92.Under the circumstances,we find the explanation and computation of [LBP] to be sufficient and in accordance with applicable laws. [LBPs] valuation must thus be upheld.[45](Emphases ours.)InApo Fruits Corporation v. Court of Appeals,[46]we once more gave paramount importance to the criteria inscribed in Section 17 of Republic Act No. 6657 and the pertinent DAOs. In sustaining therein the valuation of the special agrarian court, we ratiocinated:[T]heCourt affirmed the due consideration given by the RTC of the factors specified in Section 17, Republic Act No. 6657. Again, the proper valuation of the subject premises was reached with clear regard for the acquisition cost of the land, current market value of the properties, its nature, actual use and income,inter alia factors that are material and relevant in determining just compensation.These are the very same factors laid down in a formula by DAR A.O. No. 5. Due regard was thus given by the RTC to Republic Act No. 6657, DAR A.O. No. 5and prevailing jurisprudence when it arrived at the value of just compensation due to AFC and HPI in this case.The CourtEn BancinLand Bank of the Philippines v. Lim[47]was confronted with the question of whether the RTC can resort to any other means of determining just compensation aside from Section 17 of Republic Act No. 6657 and DAO No. 6, Series of 1992, as amended.The Court resolved the issue in the negative and pronounced that Section 17 of Republic Act No. 6657 and DAO No. 6, Series of 1992, as amended, are mandatory and are not mere guides that the RTC may disregard. CitingBanalandCelada, we held inLimthat:InLand Bank of the Philippines v. Spouses Banal[434 SCRA 543],this Court underscored the mandatory nature of Section 17 of RA 6657 and DAR AO 6-92, as amended by DAR AO 11-94, x x x.x x x xAnd inLBP v. Celada[479 SCRA 495],this Court set aside the valuation fixed by the RTC of Tagbilaran, which was based solely on the valuation of neighboring properties, because it did not apply the DAR valuation formula. x x x.x x x xConsequently, as the amount ofP2,232,868 adopted by the RTC in its December 21, 2001 Order wasnot based on any of the mandatory formulas prescribed in DAR AO 6-92, as amended by DAR AO 11-94, the Court of Appealserred when it affirmed the valuationadopted by the RTC.(Emphases ours.)In the instant case, the RTC did not pay particular attention to Section 17 of Republic Act No. 6657 and DAO No. 6, Series of 1992, as amended.It merely cited the location of the subject land, nature of the trees planted thereon, and Morales appraisal report, as bases for fixing the value of the subject land atP100,000.00 per hectare; which are not among the factors mentioned in Section 17 of Republic Act No. 6657.Also, the RTC did not apply the formula stated under DAO No. 6, Series of 1992, as amended, in fixing the value of the subject land.This undoubtedly constitutes an obvious departure from the settled doctrine previously discussed herein regarding the mandatory nature of Section 17 of Republic Act No. 6657 and DAO No. 6, Series of 1992, as amended.Further, Morales, in his appraisal report, used the market data approach (a method which based the value of the subject land on sales and listings of similar properties situated within the area), and the income approach (a procedure which based the value of the subject land on the potential net benefit that may be derived from its ownership) in determining the value of the subject land.[48]Morales did not explicitly state or even impliedly use Section 17 of Republic Act No. 6657 and DAO No. 6, Series of 1992, as amended, in his appraisal report for the subject land.Neither was there any foundation for concluding that the market data approach and income approach conformed to statutory and regulatory requirements.More importantly, Morales himself admitted during the trial that he did not consider Republic Act No. 6657 and DAO No. 6, Series of 1992, as amended, in his appraisal report for the subject land, despite being aware of the said law and rules for a long time.[49]This being the case, the valuation of the subject land, as contained in the appraisal report adopted by the RTC, cannot be deemed to be in compliance with the requirements under Section 17 of Republic Act No. 6657 and DAO No. 6, Series of 1992, as amended.In contrast, LBP arrived at its valuation of the subject land by considering the factors identified under Section 17 of Republic Act No. 6657, and by computing the same in accordance with the formula in DAO No. 6, Series of 1992, as amended.The meticulous calculations of LBP are reproduced below:FORMULA USED IN THE VALUATION OF THE SUBJECT PROPERTYThe records show that Acquisition Cost (CA), Market Value based on Mortgage (MVM) and Comparable Sales (CS) are not applicable.Hence, pursuant to paragraph A.2 ofDAR Adm. Order No. 6, Series of 1992, the applicable formula in arriving at the land Value is:LV = (CNI x 0.9) + (MV [x] 0.1).Considering that the subject property is covered by an existing lease contract, the Lease Rental Income was also considered in the computation of the Capitalized Net Income (CNI) by following the formula prescribed under paragraph B.7 of Dar Adm. Order No. 6, Series of 1992, thus:CNI =LRI.12DISCUSSION OF THE FORMULAEThe pertinent provisions ofDAR Adm. Order No. 6, Series of 1992, reads:B.Capitalized Net Income (CNI) This shall refer to the difference between the gross sales (AGP x SP) and total cost of operations (CO) capitalized at 12%.Expressed in equation form:CNI =(AGP x SP) CO.12Where:CNI = Capitalized Net IncomeAGP = One years Average Gross Production immediately preceding the date of offer in case of VOS or date of notice of coverage in case of CA.SP=Selling price shall refer to average prices for the immediately preceding calendar year from the date of receipt of the claimfolder by LBP from DAR for processing secured from the Department of Agriculture (DA) other appropriate regulatory bodies or in their absence, from Bureau of Agricultural Statistics.If possible, SP data shall be gathered from the barangay or municipality where the property is located.In the absence thereof, SP may be secured within the province or region.CO=Cost of OperationsWhenever the cost of operations could not be obtained or not be obtained or verified, and assumed net income rate (NIR) of 20% shall be used.Landholdings planted to coconut which are productive at the time of offer/coverage shall continue to use the 70% NIR x x x12=Capitalized RateB.1Industry data on production, cost of operation, and selling price shall be obtained from government/private entities.Such entities shall include, but not limited to the Department of Agriculture (DA), the Sugar Regulatory Authority (SRA), the Philippine Coconut Authority (PCA) and other private persons/entities knowledgeable to the concerned industry.B.2The landowner shall submit a statement of net income derived from the land subject of acquisition.This shall include among others, total production and cost of operations on a per crop basis, selling price/s (farm gate) and such other data as may be required.x x x xIn case of failure by the landowner to submit the statement x x x or the data stated therein cannot be verified/validated from the farmers, LBP may adopt any available industry data or in the absence thereof may conduct an industry study on the specific crop which will be used in determining the production, cost and net income of the subject landholding.x x x xB.7For landholdings planted to permanent crops which are covered by existing lease contract, the following formula shall be used in the computation of the CNI:CNI/Ha. =LRI.12Where:LRI = Lease Rental Income per Hectare/Year as stipulated under the contract.x x x xc.In case the lease rental is a variable amount (e.g., progressively increasing during the term of the lease), LRI is computed as follows:Sum of Annual lease Rental per Hectare overLRI =the remaining Term of the Lease ContractRemaining Term of Lease, Yearsx x x xD.Market Value per Tax Declaration (MV) shall refer to the market value per Tax Declaration (TD) issued beforeAugust 29, 1987(effectivity of EO 229).The most recent set of values indicated in the latest schedule of unit value (SMV) grossed-up for inflation rate from the date of effectivity up to the date of receipt of claimfolder by LBP from DAR for processing.CAPITALIZED NET INCOMERe:AGPLANDBANK adopted as AGP the average production indicated in the Contract of Lease which is 44 metric tons of copra per month (net) or 528 metric tons a year.Converted into kilos, the AGP per hectare is 658.12 kilos.Re:Selling PriceAs Selling Price, LANDBANK used the 1992 Philippine Coconut Authority Data which isP6.87 per kilo as the same is the average price for the immediately preceding calendar year from the date of receipt by LANDBANK of the claimfolder from DAR for processing in 1993 pursuant to paragraph 5, Item B ofDAR Adm. Order No. 6, Series of 1992, above quoted.Re:Capitalization RateA 12% capitalization rate was used in accordance with paragraph 8,Item B ofDAR Adm. Order No. 6, Series of 1992.Using the foregoing as input, the CNI for copra isP37,677.37 per hectare (658.12 kilos xP6.87 per kilo / .12).Cocoawas not included in the computation of the CNI because there is no production data available.Further, the same was introduced by the lessee.Re:LRIPursuant to Item B, paragraph B.7, sub-paragraph c ofDAR Adm. Order No. 6, Series of 1992, LANDBANK computed the total lease rentals for the remaining period of the lease contract (1994 to 2007 or 14 years).Thus, LRI = (690 x 4) + (P680 x 5) + (P1,120 x 5) divided by 14 orP904.29 per hectare.Following the formula:12% over LRI (P904.29), the CNI per hectare (Lease Contract) isP7,535.75.MARKET VALUE PER TAX DECLARATIONIn the computation of the market Value per Tax Declaration (MV), the unit market values of both the land and the coconut trees were determined based on the 1991 Schedule of Market Values for agricultural properties in Sta. Maria, Davao del Sur.Per the said Schedule of Market Values, the subject property is classified as third class cocoland and has a unit market value ofP6,240.00 per hectare while the cocotrees have a unit market value ofP62.40 per tree.The unit market values of both the land and the cocotrees were multiplied with the location adjustment factor of 98% and the results were in turn multiplied with the Consumer Price Index (1.1254).Thus, the total market value as adjusted for the land isP6,882.05 per hectare andP4,129.23 for the cocotrees or a total ofP11,011.28 per hectare.In summation:CNI (copra)-P37,677.37 per ha.CNI (Lease contract)-P7,535.75 per ha.Total CNI-P45,213.12 per ha.MV (Land)-P6,882.05 per ha.MV (cocotree)-P4,129.23 per ha.Total MV-P11,011.28 per ha.Following the formula:LV= CNI x 0.9 (P45,213.12 x 0.9)P40,691.81 + MV 0.1 (11,011.28 x 0.1)P1,101.13 x 457.9952 hectares,the total value of the area subject to acquisition isP19,140,965.91.[50](Emphases supplied).We find the foregoing exhaustive explanation and thorough computations of LBP to be sufficient and in accordance with Section 17 of Republic Act No. 6657 and DAO No. 6, Series of 1992, as amended.Hence, the Court affirms the valuation by LBP ofP41,792.94 per hectare, or a total ofP19,140,965.91, for the subject land.Since we have already resolved the issue inG.R No. 177404, we shall now discuss and determine the matters brought up inG.R. No. 178097.In its Petition docketed asG.R. No. 178097, KPCI argues that the imposition of legal interest as damages is warranted because LBP has delayed in paying just compensation for the subject land.KPCI alleges that the act of LBP in appealing the decisions of the RTC and the Court of Appeals reveals the intent of the LBP to delay the payment of just compensation to KPCI.[51]Given our finding that it is the valuation of the subject land by the LBP that is correct and in compliance with the requirements of the law and administrative rules and regulations, then the issue of interest, raised by KPCI in its Petition, has actually become irrelevant.The amount ofP19,140,965.91, representing the valuation of LBP for the entire subject land, was deposited for the account of and in the name of KPCI, which the latter had admittedly already withdrawn.The just compensation for the subject land is, thus, already fully paid.Even if we were still to address the issue of interest, we shall decide against KPCI.In expropriation cases, interest is due the landowner if there was delay in payment.The imposition of interest was in the nature of damages for the delay in payment, which in effect makes the obligation on the part of the government one of forbearance.It follows that the interest in the form of damages cannot be applied where there was prompt and valid payment of just compensation.[52]InApo Fruits Corporation v. Court of Appeals,[53]we stressed that interest on just compensation is imposed only in case of delay in the payment thereof, which must be sufficiently established.There is nothing in the records to show that LBP was delayed in the payment of just compensation to KPCI.In fact, contrary to the claim of KPCI, it was paid just compensation by LBP with dispatch.The mere fact that LBP appealed the decisions of the RTC and the Court of Appeals does not mean that it deliberately delayed the payment of just compensation to KPCI.LBP is an agency created primarily to provide financial support in all phases of agrarian reform pursuant to Section 74 of Republic Act No. 3844 and Section 64 of Republic Act No. 6657. It is vested with the primary responsibility and authority in the valuation and compensation of covered landholdings to carry out the full implementation of the Agrarian Reform Program.It may agree with the DAR and the landowner as to the amount of just compensation to be paid to the latter and may also disagree with them and bring the matter to court for judicial determination.[54]This makes the LBP an indispensable party in cases involving just compensation for lands taken under the Agrarian Reform Program, with a right to appeal decisions in such cases that are unfavorable to it.Having only exercised its right to appeal in this case, LBP cannot be penalized by making it pay for interest.WHEREFORE, in view of the foregoing:1) The Petition of Land Bank of thePhilippinesin G.R. No. 177404 isGRANTED.The Decision, dated24 November 2005, and Resolution, dated30 March 2007, of the Court of Appeals in CA-G.R. CV No. 65923, areREVERSED and SET ASIDE.The valuation of the subject land atP41,792.94 per hectare, for a total ofP19,140,965.91, by the Land Bank of the Philippines isAPPROVED, and such amount isDECLARED PAID IN FULL; and2) The Petition of Kumassie Plantation Company Incorporated isDENIED.No costs.SO ORDERED.MINITA V. CHICO-NAZARIOAssociate Justice

WE CONCUR:CONSUELO YNARES-SANTIAGOAssociate JusticeChairpersonPRESBITERO J. VELASCO, JR.Associate JusticeANTONIO EDUARDO B. NACHURAAssociate Justice

DIOSDADO M. PERALTAAssociate Justice

ATTESTATIONI attest that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.CONSUELO YNARES-SANTIAGOAssociate JusticeChairperson, Third DivisionCERTIFICATIONPursuant to Section 13, Article VIII of the Constitution, and the Division Chairpersons Attestation, it is hereby certified that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.REYNATO S. PUNOChief Justice

[1]Rollo(G.R. No. 177404), pp. 33-55 and (G.R. No. 178097) pp. 29-49.[2]Penned by Associate Justice Normandie B. Pizarro with Associate Justices Edgardo A. Camello and Ricardo R. Rosario, concurring; CArollo, pp. 81-90.[3]Id.at 241-243.[4]Records, pp. 12-14.[5]Id.at 246-254.[6]Id.at 255-259.[7]Id.at 20.[8]Id. at 22; Executive Order No. 405, dated 14 June 1990, vests the Land Bank of the Philippines the primary responsibility to determine the land valuation and compensation for all private lands covered by Republic Act No. 6657. SeePhilippine Veterans Bank v. Court of Appeals, 379 Phil. 141, 145 (2000).[9]Records, p. 15.[10]Id.at 20.[11]Id.at 21.[12]Id.at 22.[13]Id.at 6.[14]Pursuant to Section 16(d) of Republic Act No. 6657.[15]CArollo, p. 188;rollo(G.R. No. 177404), pp. 107-113.[16]Records, p. 22.[17]Id.at 23.[18]Id.at 1-11.[19]Id.[20]Id.at 77-83 and 95-97.[21]Id.at 73.[22]Id.at 75.[23]Id.at 81.[24]Id.at 83.[25]Id.at 92-93.[26]Id.at 217-222.[27]Id.[28]Id.at 346-355;The RTC failed to state the total amount payable to KPCI as just compensation, but considering its valuation of the subject land atP100,000.00 per hectare, and the total area of the subject land which is 457.9552 hectares, then total just compensation would amount toP45,795,200.00.The RTC likewise failed to mention subtracting from the total just compensation awarded theP19,149.965.91 already received by KPCI.[29]Id.at 356-360.[30]Id.at 363.[31]Id.at 375.[32]CArollo, pp. 16-33.[33]Id.[34]Id.at 73-74.[35]Id.at 90.[36]CArollo, pp. 118-139.[37]Rollo(G.R. No. 178097), p. 159.[38]Land Bank of thePhilippinesv. Banal, G.R. No. 143276,20 July 2004, 434 SCRA 543, 550-551.[39]Rollo, (G.R. No. 177404), pp. 42-53.[40]Supra note 38.[41]G.R. No. 164876,23 January 2006, 479 SCRA 495.[42]G.R. No. 171941,2 August 2007, 529 SCRA 129.[43]Supra note 38 at 549-554.[44]Supra note 41 at 506-507.[45]Id.at 510-512.[46]G.R. No. 164195,30 April 2008, 553 SCRA 237, 247.[47]Supra note 42 at 134-136.[48]Records pp. 99-146.[49]TSN,18 September 1997, pp. 37-38.[50]Rollo(G.R. No. 177404), pp. 108-113; CArollo, pp. 332-335.[51]Rollo(G.R. No. 178097), pp. 42-44.[52]Apo Fruits Corporation v. Court of Appeals, G.R. No. 164195, 19 December 2007, 541 SCRA 117, 141;Land Bank of the Philippines v. Wycoco, 464 Phil. 83, 100 (2004), citingReyes v. National Housing Authority, 443 Phil. 603, 616 (2003) andRepublic v. Court of Appeals, 433 Phil. 106, 122-123 (2002).[53]Id.at 142.[54]Heirs of Roque F.Tabuena v. Land Bank of thePhilippines, G.R. No. 180557, 26 September 2008, 566 SCRA 557, 566.THIRD DIVISIONDEPARTMENT OF AGRARIAN REFORM (DAR), represented by HON. NASSERC. PANGANDAMAN, in his capacity as DAR OIC-Secretary,Petitioner,-versus-CARMEN S. TONGSON,Respondent.G.R. No. 171674Present:YNARES-SANTIAGO,J.,Chairperson,CHICO-NAZARIO,VELASCO, JR.,NACHURA,andPERALTA,JJ.Promulgated:August 4, 2009

x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - xD E C I S I O NPERALTA,J.:

Before this Court is a Petition for Review onCertiorari[1]under Rule 45 of the Rules of Court seeking to set aside the August 30, 2005 Decision[2]and February 10, 2006 Resolution[3]of the Court of Appeals (CA) in CA-G.R. CV No. 64176.The facts of the case:Respondent Carmen S. Tongson is the owner of four parcels of agricultural land located in Davao City.Three of these properties are located in Bayabas, Toril and the other located at Wangan, Calinan. Since the properties were primarily devoted to rice and corn under a system of lease-tenancy agreement, the same were brought under the coverage of Presidential Decree No. 27[4](PD 27), otherwise known as Tenants Emancipation Decree.[5]Sometime in 1988, the petitioner Department of Agrarian Reform offered to pay respondentP9,000.00 per hectare for her properties in Bayabas, Toril. Respondent, however, did not act on the offer as she was then leaving for theUnited Statesfor her husbands medical treatment.[6]In 1989, upon her return to Davao, respondent was surprised to learn that, except for the portions devoted to orchards and planted with coconuts, all her properties in Wangan, Calinan and in Bayabas, Toril were taken over by petitioner.[7]Respondent alleged that petitioner summarily took her properties without any notice and had fixed the acquisition cost for the same atP1,500.00 per hectare for those located at Bayabas, Toril andP800.00 per hectare for the one located at Wangan, Calinan. Lastly, respondent alleged that petitioner subsequently issued Emancipation Patents to the farmer-beneficiaries.[8]Petitioner denied the allegations and averred that the properties were placed under the coverage of the agrarian reform program; hence, not summarily taken. Likewise, petitioner claimed that respondent was notified of the proceedings when they made the initial offer to her. Lastly, petitioner claimed that the acquisition cost was arrived at based on PD 27 in relation to Executive Order No. 228[9](EO 228), and that the subsequent issuance of Emancipation Patents was part of the implementation of the program.[10]On October 25, 1993, respondent filed a Petition[11]for thedetermination of just compensation before the Special Agrarian Court (SAC), Branch 15, of the Regional Trial Court of Davao City.The same was docketed as Civil Case No. 22,408-93.During the trial, the SAC formed a Board of Commissioners to appraise the value of the properties. Thereafter, the commissioners using the market-date approach submitted their Report.[12]Taking into consideration the value of the neighboring properties based on sale offerings and sale transactions, the Commissioners fixed the Bayabas properties atP75,000.00 per hectare and the Wangan property atP90,000.00 per hectare.[13]On March 17, 1999, after due deliberation and on the basis of the Commissioners Report, the SAC rendered a Decision[14]the dispositive portion of which reads:WHEREFORE, judgment is hereby rendered ordering the respondent [herein petitioner] to pay the petitioner [herein respondent] the following sums:1.Twenty-five thousand pesos per hectare for the thirty hectares in Bayabas, Toril the respondent got and distributed to beneficiaries, plus legal interest to compute from June 1, 1989 until fully paid.2.Forty thousand pesos per hectare for the twenty hectares in Wangan, Calinan that the respondent got and distributed to beneficiaries, plus legal interest to compute from June 1, 1989 until fully paid.SO ORDERED.[15]Petitioner then appealed to the CAviaRule 41 of the Rules of Court arguing in the main that the SAC erred in not applying the provisions of PD 27 and EO 228 in determining the value of the properties in dispute.[16]On August 30, 2005, the CA rendered a Decision, the dispositive portion of which reads:WHEREFORE, in view of the foregoing, the appeal is hereby DISMISSED subject to modification regarding the commissioners fees, the assailed decision is hereby AFFIRMED.SO ORDERED.[17]The CA ruled that Republic Act No. 6657[18](RA 6657), or the Comprehensive Agrarian Reform Law of 1988, was applicable in the determination of just compensation. It ruled that RA 6657 made all laws pertaining to the agrarian reform program to have suppletory application only.[19]Furthermore, the CA held that RA 6657 brought under its coverage all agricultural lands, including those where the process of agrarian reform coverage was started under PD 27 but was not completed under the decree.[20]Petitioner filed a Motion for Reconsideration,[21]which was denied by the CA in the Resolution[22]dated February 10, 2006.Hence, herein appeal, with petitioner raising a lone assignment of error, to wit:THE TRIAL COURT ERRED WHEN IT CONSIDERED FACTORS NOT THEN EXISTING AT THE TIME OF ITS TAKING, THUS, UNDULY AND TREMENDOUSLY INCREASED THE VALUATION AND, RESULTANTLY, THE AMOUNT, AS FIXED BELOW, WAS EXORBITANT, AN OVERPRICE, WHEN CONSIDERED IN THE LIGHT OF THE FACTS AND CIRCUMSTANCES THEN OCCURING ON OCTOBER 21, 1972.[23]The petition is bereft of merit.Petitioner is adamant that for purposes of computation of just compensation the same should have been based on PD 27 in relation to EO 228.The pertinent portions of PD 27 read:x x x xFor the purpose of determining the cost of the landto be transferred to the tenant-farmer pursuant to this Decree,the value of the landshall be equivalent to two and one half (2-1/2) times the average harvest of three normal crop years immediately preceding the promulgation of this Decree.The total cost of the land, including interest at the rate of six (6) per centum per annum, shall be paid by the tenant in fifteen (15) years of fifteen (15) equal annual amortizations.(Emphasis supplied)Implementing the formula under PD 27, EO 228 states:x x x xSECTION 2. Henceforth, the valuation of rice and corn lands covered by P.D. No. 27 shall bebasedontheaverage gross production determined by theBarangayCommittee on LandProduction in accordance with Department Memorandum Circular No. 26, series of 1973 and related issuances and regulation of the Department of Agrarian Reform.The average gross production per hectare shall be multiplied by two and a half (2.5), the product of which shall be multiplied by Thirty-Five Pesos (P35.00), the government support price for one cavan of 50 kilos ofpalayon October 21, 1972, or Thirty-One Pesos (P31.00), the government support price for one cavan of 50 kilos of corn on October 21, 1972,and the amount arrived at shall be the value of the rice and corn land, as the case may be, for the purpose of determining its cost to the farmer and compensation to the landowner.On the other hand, respondent contends that RA 6657 should be the basis for the computation of just compensation. Section 17 of which reads:Sec. 17.Determination of Just Compensation.In determining just compensation, the cost of acquisition of the land, the current value of the 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 farm workers 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.[24]Clearly, PD 27 and RA 6657 provide different factors for the computation of just compensation. The former uses average crop harvest as a consideration, whereas, the latter uses 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 as factors for consideration in determining just compensation.In the case at bar, it is undisputed by the parties that the lands were acquired under PD 27. Moreover, it is also undisputed that just compensation has not yet been settled prior to the passage of RA 6657. Thus, the issue to be determined is what law shall govern in the determination of just compensation.The issue, once the subject of a number of cases, has finally been settled by this Court in recent years. It has been ruled that, if just compensation was not settled prior to the passage of RA 6657, it should be computed in accordance with the said law, although the property was acquired under PD 27.[25]InLandbank of the Philippines v. Carolina B. Vda. de Abello, et al.,[26]this Court ruled:Under the factual circumstances of the case, the agrarian reform process is still incomplete as the just compensation to be paid respondents has yet to be settled.Considering the passage RA 6657 before the completion of this process, the just compensation should be determined and the process concluded under the said law. Indeed, thisCourt has time and again upheld the applicability of RA 6657, with PD 27 and EO 228 having only suppletory effect, conformably with our ruling inParisv. Alfeche.Likewise, inLand Bank of the Philippines vs. Heirs of Angel T. Domingo,[27]this Court ruled:InLand Bank v. Natividad,the Court held that the determination of just compensation in accordance with RA 6657, and not PD 27 and 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. In this same case, this Court also had the occasion to discuss the just compensation for PD 27 lands, thus: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 likewise erroneous. InOffice of the President, Malacaang,Manilav. Court of Appeals, we ruled that the seizure of the landholding did not take place on the date of effectivity of PD 27 but would take effect on the payment of just compensation.To be sure, the foregoing doctrine can also be found inLandbank of the Philippines v. Josefina Dumlao et al[28]andMeneses v. Secretary of Agrarian Reform.[29]In sum, since the lands in dispute were taken under PD 27 and just compensation has not yet been settled prior to the passage of RA 6657, the latter law should be made applicable in conformity with this Courts ruling in the abovementioned cases.The last issue to be resolved then is when was their actual taking? The same has already been settled inDomingowhere this Court ruled:LBPs contention that the property was taken on 21 October 1972, the date of effectivity of PD 27, thus just compensation should be computed based on the GSP in 1972, is erroneous.The date of taking of the subject land for purposes of computing just compensation should be reckoned from the issuance dates of the emancipation patents. An emancipation patent constitutes the conclusive authority for the issuance of a Transfer Certificate of Title in the name of the grantee. It is from the issuance of an emancipation patent that the grantee can acquire the vested right ofownership in the landholding, subject to the payment of just compensation to the landowner.[30]Hence, it is the date of the issuance of emancipation patents that should serve as the reckoning point for purposes of computation of just compensation. Copies of the emancipation patents issued to the farmer-beneficiaries, however, havenotbeenattachedtotherecords of the case.Except in certain portions[31]of the RTC decision where one can infer that the emancipation patents were issued in 1989, this Court is not certain of the exact date thereof. Hence, this Court is constrained to remand the case back to the SAC for receipt of evidence as to the date of the grant of the emancipation patents, which date shall serve as the reckoning point for the computation of just compensation due respondent.WHEREFORE, premises considered, the August 30, 2005 Decision and February 10, 2006 Resolution of the Court of Appeals in CA-G.R. CV No. 64176 are herebyAFFIRMED. The records of the case is orderedREMANDEDto the Special Agrarian Court, Branch 15, of the Regional Trial Court of Davao City, for further reception of evidence as to the date of the grant of the emancipation patents which shall serve as the basis for the computation of just compensation in accordance with the market-data approach pursuant to Republic Act No. 6657.SO ORDERED.DIOSDADO M. PERALTAAssociate JusticeWE CONCUR:CONSUELO YNARES-SANTIAGOAssociate JusticeChairpersonMINITA V. CHICO-NAZARIOPRESBITERO J. VELASCO, JR.Associate JusticeAssociate JusticeANTONIO EDUARDO B. NACHURAAssociate JusticeATTESTATIONI attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.CONSUELO YNARES-SANTIAGOAssociate JusticeThird Division, ChairpersonCERTIFICATIONPursuant to Section 13, Article VIII of the Constitution and the Division Chairpersons Attestation, I certify that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.REYNATO S. PUNOChief Justice

[1]Rollo, pp. 8-18[2]Penned by Associate Justice Rodrigo F. Lim, Jr., with Associate Justices Arturo G. Tayag and Normandie B. Pizarro concurring;id. at20-32.[3]Rollo, pp. 35-36.[4]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; October 21, 1972.[5]Rollo, p. 21.[6]Id. at22.[7]Id.[8]Id.[9]DECLARING FULL LAND OWNERSHIP TO QUALIFIED FARMER-BENEFICIARIES COVERED BY PRESIDENTIAL DECREE NO. 27; DETERMINING THE VALUE OF THE REMANING UNVLAUED RICE AND CORN LANDS SUBJECT OF P.D. 27; AND PROVIDING FOR THE MANNER OF PAYMENT BY THE FARMER-BENEFICIARY AND MODE OF COMPENSATION TO THE LAND OWNER.[10]Rollo,pp. 23-24 .[11]Records, pp. 1-4.[12]Id. at 141-144.[13]Rollo,p.24.[14]CArollo, pp. 32-38.[15]Id. at 38.[16]Rollo,p.24.[17]Id. at 32.[18]Effective June 15, 1988.[19]Rollo,p. 26.[20]Id. at 27.[21]Id. at 41-45.[22]Supranote 3.[23]Rollo, p. 14.[24]Emphasis supplied.[25]Land Bank of the Philippines v. Josefina Dumlao, et al.,G.R. No. 167809,November 27, 2008.[26]G.R. No. 168631,April 7, 2009.[27]G.R. No. 168533, February 4, 2008, 543 SCRA 627, 640. (Emphasis supplied.)[28]Supranote25.[29]G.R. No. 156304,October 23, 2006, 505 SCRA 90.[30]Supranote 27, at 642. (Emphasis supplied.)[31]10. That from 1989 when the titles of the petitioners were cancelled and emancipation patents given to beneficiaries up to 1993 when this case was filed, respondent did not even try to confer with the petitioner regarding just compensation.x x x x15. That the unjust taking of the petitioners lands happened in 1989 hence the petitioner is entitled to legal interest from 1989 until respondent pays in full the purchase price. (CArollo, pp. 35-36)Republic of the PhilippinesSUPREME COURTManilaEN BANCG.R. No. 127876 December 17, 1999ROXAS & CO., INC.,petitioner,vs.THE HONORABLE COURT OF APPEALS, DEPARTMENT OF AGRARIAN REFORM, SECRETARY OF AGRARIAN REFORM, DAR REGIONAL DIRECTOR FOR REGION IV, MUNICIPAL AGRARIAN REFORM OFFICER OF NASUGBU, BATANGAS and DEPARTMENT OF AGRARIAN REFORM ADJUDICATION BOARD,respondents.PUNO,J.:This case involves three (3) haciendas in Nasugbu, Batangas owned by petitioner and the validity of the acquisition of these haciendas by the government under Republic Act No. 6657, the Comprehensive Agrarian Reform Law of 1988.Petitioner Roxas & Co. is a domestic corporation and is the registered owner of three haciendas, namely, Haciendas Palico, Banilad and Caylaway, all located in the Municipality of Nasugbu, Batangas. Hacienda Palico is 1,024 hectares in area and is registered under Transfer Certificate of Title (TCT) No. 985. This land is covered by Tax Declaration Nos. 0465, 0466, 0468, 0470, 0234 and 0354. Hacienda Banilad is 1,050 hectares in area, registered under TCT No. 924 and covered by Tax Declaration Nos. 0236, 0237 and 0390. Hacienda Caylaway is 867.4571 hectares in area and is registered under TCT Nos. T-44662, T-44663, T-44664 and T-44665.The events of this case occurred during the incumbency of then President Corazon C. Aquino. In February 1986, President Aquino issued Proclamation No. 3 promulgating a Provisional Constitution. As head of the provisional government, the President exercised legislative power "until a legislature is elected and convened under a new Constitution."1In the exercise of this legislative power, the President signed on July 22, 1987, Proclamation No. 131 instituting a Comprehensive Agrarian Reform Program and Executive Order No. 229 providing the mechanisms necessary to initially implement the program.On July 27, 1987, the Congress of the Philippines formally convened and took over legislative power from the President.2This Congress passed Republic Act No. 6657, the Comprehensive Agrarian Reform Law (CARL) of 1988. The Act was signed by the President on June 10, 1988 and took effect on June 15, 1988.Before the law's effectivity, on May 6, 1988, petitioner filed with respondent DAR a voluntary offer to sell Hacienda Caylaway pursuant to the provisions of E.O. No. 229. Haciendas Palico and Banilad were later placed under compulsory acquisition by respondent DAR in accordance with the CARL.Hacienda PalicoOn September 29, 1989, respondent DAR, through respondent Municipal Agrarian Reform Officer (MARO) of Nasugbu, Batangas, sent a notice entitled "Invitation to Parties" to petitioner. The Invitation was addressed to "Jaime Pimentel, Hda. Administrator, Hda. Palico."3Therein, the MARO invited petitioner to a conference on October 6, 1989 at the DAR office in Nasugbu to discuss the results of the DAR investigation of Hacienda Palico, which was "scheduled for compulsory acquisition this year under the Comprehensive Agrarian Reform Program."4On October 25, 1989, the MARO completed three (3) Investigation Reports after investigation and ocular inspection of the Hacienda. In the first Report, the MARO found that 270 hectares under Tax Declaration Nos. 465, 466, 468 and 470 were "flat to undulating (0-8% slope)" and actually occupied and cultivated by 34 tillers of sugarcane.5In the second Report, the MARO identified as "flat to undulating" approximately 339 hectares under Tax Declaration No. 0234 which also had several actual occupants and tillers of sugarcane;6while in the third Report, the MARO found approximately 75 hectare under Tax Declaration No. 0354 as "flat to undulating" with 33 actual occupants and tillers also of sugarcane.7On October 27, 1989, a "Summary Investigation Report" was submitted and signed jointly by the MARO, representatives of the Barangay Agrarian Reform Committee (BARC) and Land Bank of the Philippines (LBP), and by the Provincial Agrarian Reform Officer (PARO). The Report recommended that 333.0800 hectares of Hacienda Palico be subject to compulsory acquisition at a value of P6,807,622.20.8The following day, October 28, 1989, two (2) more Summary Investigation Reports were submitted by the same officers and representatives. They recommended that 270.0876 hectares and 75.3800 hectares be placed under compulsory acquisition at a compensation of P8,109,739.00 and P2,188,195.47, respectively.9On December 12, 1989, respondent DAR through then Department Secretary Miriam D. Santiago sent a "Notice of Acquisition" to petitioner. The Notice was addressed as follows:Roxas y Cia, LimitedSoriano Bldg., Plaza CervantesManila, Metro Manila.10Petitioner was informed that 1,023.999 hectares of its land in Hacienda Palico were subject to immediate acquisition and distribution by the government under the CARL; that based on the DAR's valuation criteria, the government was offering compensation of P3.4 million for 333.0800 hectares; that whether this offer was to be accepted or rejected, petitioner was to inform the Bureau of Land Acquisition and Distribution (BLAD) of the DAR; that in case of petitioner's rejection or failure to reply within thirty days, respondent DAR shall conduct summary administrative proceedings with notice to petitioner to determine just compensation for the land; that if petitioner accepts respondent DAR's offer, or upon deposit of the compensation with an accessible bank if it rejects the same, the DAR shall take immediate possession of the land.11Almost two years later, on September 26, 1991, the DAR Regional Director sent to the LBP Land Valuation Manager three (3) separate Memoranda entitled "Request to Open Trust Account." Each Memoranda requested that a trust account representing the valuation of three portions of Hacienda Palico be opened in favor of the petitioner in view of the latter's rejection of its offered value.12Meanwhile in a letter dated May 4, 1993, petitioner applied with the DAR for conversion of Haciendas Palico and Banilad from agricultural to non-agricultural lands under the provisions of the CARL.13On July 14, 1993, petitioner sent a letter to the DAR Regional Director reiterating its request for conversion of the two haciendas.14Despite petitioner's application for conversion, respondent DAR proceeded with the acquisition of the two Haciendas. The LBP trust accounts as compensation for Hacienda Palico were replaced by respondent DAR with cash and LBP bonds.15On October 22, 1993, from the mother title of TCT No. 985 of the Hacienda, respondent DAR registered Certificate of Land Ownership Award (CLOA) No. 6654. On October 30, 1993, CLOA's were distributed to farmer beneficiaries.16Hacienda BaniladOn August 23, 1989, respondent DAR, through respondent MARO of Nasugbu, Batangas, sent a notice to petitioner addressed as follows:Mr. Jaime PimentelHacienda AdministratorHacienda BaniladNasugbu, Batangas17The MARO informed Pimentel that Hacienda Banilad was subject to compulsory acquisition under the CARL; that should petitioner wish to avail of the other schemes such as Voluntary Offer to Sell or Voluntary Land Transfer, respondent DAR was willing to provide assistance thereto.18On September 18, 1989, the MARO sent an "Invitation to Parties" again to Pimentel inviting the latter to attend a conference on September 21, 1989 at the MARO Office in Nasugbu to discuss the results of the MARO's investigation over Hacienda Banilad.19On September 21, 1989, the same day the conference was held, the MARO submitted two (2) Reports. In his first Report, he found that approximately 709 hectares of land under Tax Declaration Nos. 0237 and 0236 were "flat to undulating (0-8% slope)." On this area were discovered 162 actual occupants and tillers of sugarcane.20In the second Report, it was found that approximately 235 hectares under Tax Declaration No. 0390 were "flat to undulating," on which were 92 actual occupants and tillers of sugarcane.21The results of these Reports were discussed at the conference. Present in the conference were representatives of the prospective farmer beneficiaries, the BARC, the LBP, and Jaime Pimentel on behalf of the landowner.22After the meeting, on the same day, September 21, 1989, a Summary Investigation Report was submitted jointly by the MARO, representatives of the BARC, LBP, and the PARO. They recommended that after ocular inspection of the property, 234.6498 hectares under Tax Declaration No. 0390 be subject to compulsory acquisition and distribution by CLOA.23The following day, September 22, 1989, a second Summary Investigation was submitted by the same officers. They recommended that 737.2590 hectares under Tax Declaration Nos. 0236 and 0237 be likewise placed under compulsory acquisition for distribution.24On December 12, 1989, respondent DAR, through the Department Secretary, sent to petitioner two (2) separate "Notices of Acquisition" over Hacienda Banilad. These Notices were sent on the same day as the Notice of Acquisition over Hacienda Palico. Unlike the Notice over Hacienda Palico, however, the Notices over Hacienda Banilad were addressed to:Roxas y Cia. Limited7th Floor, Cacho-Gonzales Bldg. 101 Aguirre St., Leg.Makati, Metro Manila.25Respondent DAR offered petitioner compensation of P15,108,995.52 for 729.4190 hectares and P4,428,496.00 for 234.6498 hectares.26On September 26, 1991, the DAR Regional Director sent to the LBP Land Valuation Manager a "Request to Open Trust Account" in petitioner's name as compensation for 234.6493 hectares of Hacienda Banilad.27A second "Request to Open Trust Account" was sent on November 18, 1991 over 723.4130 hectares of said Hacienda.28On December 18, 1991, the LBP certified that the amounts of P4,428,496.40 and P21,234,468.78 in cash and LBP bonds had been earmarked as compensation for petitioner's land in Hacienda Banilad.29On May 4, 1993, petitioner applied for conversion of both Haciendas Palico and Banilad.Hacienda CaylawayHacienda Caylaway was voluntarily offered for sale to the government on May 6, 1988 before the effectivity of the CARL. The Hacienda has a total area of 867.4571 hectares and is covered by four (4) titles TCT Nos. T-44662, T-44663, T-44664 and T-44665. On January 12, 1989, respondent DAR, through the Regional Director for Region IV, sent to petitioner two (2) separate Resolutions accepting petitioner's voluntary offer to sell Hacienda Caylaway, particularly TCT Nos. T-44664 and T-44663.30The Resolutions were addressed to:Roxas & Company, Inc.7th Flr. Cacho-Gonzales Bldg.Aguirre, Legaspi VillageMakati, M. M31On September 4, 1990, the DAR Regional Director issued two separate Memoranda to the LBP Regional Manager requesting for the valuation of the land under TCT Nos. T-44664 and T-44663.32On the same day, respondent DAR, through the Regional Director, sent to petitioner a "Notice of Acquisition" over 241.6777 hectares under TCT No. T-44664 and 533.8180 hectares under TCT No. T-44663.33Like the Resolutions of Acceptance, the Notice of Acquisition was addressed to petitioner at its office in Makati, Metro Manila.Nevertheless, on August 6, 1992, petitioner, through its President, Eduardo J. Roxas, sent a letter to the Secretary of respondent DAR withdrawing its VOS of Hacienda Caylaway. The Sangguniang Bayan of Nasugbu, Batangas allegedly authorized the reclassification of Hacienda Caylaway from agricultural to non-agricultural. As a result, petitioner informed respondent DAR that it was applying for conversion of Hacienda Caylaway from agricultural to otheruses.34In a letter dated September 28, 1992, respondent DAR Secretary informed petitioner that a reclassification of the land would not exempt it from agrarian reform. Respondent Secretary also denied petitioner's withdrawal of the VOS on the ground that withdrawal could only be based on specific grounds such as unsuitability of the soil for agriculture, or if the slope of the land is over 18 degrees and that the land is undeveloped.35Despite the denial of the VOS withdrawal of Hacienda Caylaway, on May 11, 1993, petitioner filed its application for conversion of both Haciendas Palico and Banilad.36On July 14, 1993, petitioner, through its President, Eduardo Roxas, reiterated its request to withdraw the VOS over Hacienda Caylaway in light of the following:1) Certification issued by Conrado I. Gonzales, Officer-in-Charge, Department of Agriculture, Region 4, 4th Floor, ATI (BA) Bldg., Diliman, Quezon City dated March 1, 1993 stating that the lands subject of referenced titles "are not feasible and economically sound for further agricultural development.2) Resolution No. 19 of the Sangguniang Bayan of Nasugbu, Batangas approving the Zoning Ordinance reclassifying areas covered by the referenced titles to non-agricultural which was enacted after extensive consultation with government agencies, including [the Department of Agrarian Reform], and the requisite public hearings.3) Resolution No. 106 of the Sangguniang Panlalawigan of Batangas dated March 8, 1993 approving the Zoning Ordinance enacted by the Municipality of Nasugbu.4) Letter dated December 15, 1992 issued by Reynaldo U. Garcia of the Municipal Planning & Development, Coordinator and Deputized Zoning Administrator addressed to Mrs. Alicia P. Logarta advising that the Municipality of Nasugbu, Batangas has no objection to the conversion of the lands subject of referenced titles to non-agricultural.37On August 24, 1993 petitioner instituted Case No. N-0017-96-46 (BA) with respondent DAR Adjudication Board (DARAB) praying for the cancellation of the CLOA's issued by respondent DAR in the name of several persons. Petitioner alleged that the Municipality of Nasugbu, where the haciendas are located, had been declared a tourist zone, that the land is not suitable for agricultural production, and that the Sangguniang Bayan of Nasugbu had reclassified the land to non-agricultural.In a Resolution dated October 14, 1993, respondent DARAB held that the case involved the prejudicial question of whether the property was subject to agrarian reform, hence, this question should be submitted to the Office of the Secretary of Agrarian Reform for determination.38On October 29, 1993, petitioner filed with the Court of Appeals CA-G.R. SP No. 32484. It questioned the expropriation of its properties under the CARL and the denial of due process in the acquisition of its landholdings.Meanwhile, the petition for conversion of the three haciendas was denied by the MARO on November 8, 1993.Petitioner's petition was dismissed by the Court of Appeals on April 28, 1994.39Petitioner moved for reconsideration but the motion was denied on January 17, 1997 by respondent court.40Hence, this recourse. Petitioner assigns the following errors:A. RESPONDENT COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT PETITIONER'S CAUSE OF ACTION IS PREMATURE FOR FAILURE TO EXHAUST ADMINISTRATIVE REMEDIES IN VIEW OF THE PATENT ILLEGALITY OF THE RESPONDENTS' ACTS, THE IRREPARABLE DAMAGE CAUSED BY SAID ILLEGAL ACTS, AND THE ABSENCE OF A PLAIN, SPEEDY AND ADEQUATE REMEDY IN THE ORDINARY COURSE OF LAW ALL OF WHICH ARE EXCEPTIONS TO THE SAID DOCTRINE.B. RESPONDENT COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT PETITIONER'S LANDHOLDINGS ARE SUBJECT TO COVERAGE UNDER THE COMPREHENSIVE AGRARIAN REFORM LAW, IN VIEW OF THE UNDISPUTED FACT THAT PETITIONER'S LANDHOLDINGS HAVE BEEN CONVERTED TO NON-AGRICULTURAL USES BY PRESIDENTIAL PROCLAMATION NO. 1520 WHICH DECLARED THE MUNICIPALITY NASUGBU, BATANGAS AS A TOURIST ZONE, AND THE ZONING ORDINANCE OF THE MUNICIPALITY OF NASUGBU RE-CLASSIFYING CERTAIN PORTIONS OF PETITIONER'S LANDHOLDINGS AS NON-AGRICULTURAL, BOTH OF WHICH PLACE SAID LANDHOLDINGS OUTSIDE THE SCOPE OF AGRARIAN REFORM, OR AT THE VERY LEAST ENTITLE PETITIONER TO APPLY FOR CONVERSION AS CONCEDED BY RESPONDENT DAR.C. RESPONDENT COURT OF APPEALS GRAVELY ERRED WHEN IT FAILED TO DECLARE THE PROCEEDINGS BEFORE RESPONDENT DAR VOID FOR FAILURE TO OBSERVE DUE PROCESS, CONSIDERING THAT RESPONDENTS BLATANTLY DISREGARDED THE PROCEDURE FOR THE ACQUISITION OF PRIVATE LANDS UNDER R.A. 6657, MORE PARTICULARLY, IN FAILING TO GIVE DUE NOTICE TO THE PETITIONER AND TO PROPERLY IDENTIFY THE SPECIFIC AREAS SOUGHT TO BE ACQUIRED.D. RESPONDENT COURT OF APPEALS GRAVELY ERRED WHEN IT FAILED TO RECOGNIZE THAT PETITIONER WAS BRAZENLY AND ILLEGALLY DEPRIVED OF ITS PROPERTY WITHOUT JUST COMPENSATION, CONSIDERING THAT PETITIONER WAS NOT PAID JUST COMPENSATION BEFORE IT WAS UNCEREMONIOUSLY STRIPPED OF ITS LANDHOLDINGS THROUGH THE ISSUANCE OF CLOA'S TO ALLEGED FARMER BENEFICIARIES, IN VIOLATION OF R.A. 6657.41The assigned errors involve three (3) principal issues: (1) whether this Court can take cognizance of this petition despite petitioner's failure to exhaust administrative remedies; (2) whether the acquisition proceedings over the three haciendas were valid and in accordance with law; and (3) assuming the haciendas may be reclassified from agricultural to non-agricultural, whether this court has the power to rule on this issue.I. Exhaustion of Administrative Remedies.In its first assigned error, petitioner claims that respondent Court of Appeals gravely erred in finding that petitioner failed to exhaust administrative remedies. As a general rule, before a party may be allowed to invoke the jurisdiction of the courts of justice, he is expected to have exhausted all means of administrative redress. This is not absolute, however. There are instances when judicial action may be resorted to immediately. Among these exceptions are: (1) when the question raised is purely legal; (2) when the administrative body is in estoppel; (3) when the act complained of is patently illegal; (4) when there is urgent need for judicial intervention; (5) when the respondent acted in disregard of due process; (6) when the respondent is a department secretary whose acts, as an alter ego of the President, bear the implied or assumed approval of the latter; (7) when irreparable damage will be suffered; (8) when there is no other plain, speedy and adequate remedy; (9) when strong public interest is involved; (10) when the subject of the controversy is private land; and (11) inquo warrantoproceedings.42Petitioner rightly sought immediate redress in the courts. There was a violation of its rights and to require it to exhaust administrative remedies before the DAR itself was not a plain, speedy and adequate remedy.Respondent DAR issued Certificates of Land Ownership Award (CLOA's) to farmer beneficiaries over portions of petitioner's land without just compensation to petitioner. A Certificate of Land Ownership Award (CLOA) is evidence of ownership of land by a beneficiary under R.A. 6657, the Comprehensive Agrarian Reform Law of 1988.43Before this may be awarded to a farmer beneficiary, the land must first be acquired by the State from the landowner and ownership transferred to the former. The transfer of possession and ownership of the land to the government are conditioned upon thereceiptby 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.44There was no receipt by petitioner of any compensation for any of the lands acquired by the government.The kind of compensation to be paid the landowner is also specific. The law provides that the deposit must be made only in "cash" or "LBP bonds."45Respondent DAR's opening of trust account deposits in petitioner' s name with the Land Bank of the Philippines does not constitute payment under the law. Trust account deposits are not cash or LBP bonds. The replacement of the trust account with cash or LBP bonds did notipso factocure the lack of compensation; for essentially, the determination of this compensation was marred by lack of due process. In fact, in the entire acquisition proceedings, respondent DAR disregarded the basic requirements of administrative due process. Under these circumstances, the issuance of the CLOA's to farmer beneficiaries necessitated immediate judicial action on the part of the petitioner.II. The Validity of the Acquisition Proceedings Over the Haciendas.Petitioner's allegation of lack of due process goes into the validity of the acquisition proceedings themselves. Before we rule on this matter, however, there is need to lay down the procedure in the acquisition of private lands under the provisions of the law.A. Modes of Acquisition of Land under R. A. 6657Republic Act No. 6657, the Comprehensive Agrarian Reform Law of 1988 (CARL), provides for two (2) modes of acquisition of private land: compulsory and voluntary. The procedure for the compulsory acquisition of private lands is set forth in Section 16 of R.A. 6657,viz:Sec. 16. Procedure for Acquisition of Private Lands. For purposes of acquisition of private lands, the following procedures shall be followed:a). After having identified the land,the landowners and the beneficiaries,the DAR shall send its notice to acquire the land to the owners thereof, by personal delivery or registered mail, and post the same in a conspicuous placein the municipal building and barangay hall of the place where the property is located. Said notice shall contain the offer of the DAR to pay a corresponding value in accordance with the valuation set forth in Sections 17, 18, and other pertinent provisions hereof.b) Within thirty (30) days from the date of receipt of written notice by personal delivery or registered mail, the landowner, his administrator or representative shall inform the DAR of his acceptance or rejection of the offer.c) If the landowner accepts the offer of the DAR, the LBP shall pay the landowner the purchase price of the land within thirty (30) days after he executes and delivers a deed of transfer in favor of the Government and surrenders the Certificate of Title and other muniments of title.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 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.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. The DAR shall thereafter proceed with the redistribution of the land to the qualified beneficiaries.f) Any party who disagrees with the decision may bring the matter to the court of proper jurisdiction for final determination of just compensation.In the compulsory acquisition of private lands, the landholding, the landowners and the farmer beneficiaries must first be identified. After identification, the DAR shall send a Notice of Acquisition to the landowner, by personal delivery or registered mail, and post it in a conspicuous place in the municipal building and barangay hall of the place where the property is located. Within thirty days from receipt of the Notice of Acquisition, the landowner, his administrator or representative shall inform the DAR of his acceptance or rejection of the offer. If the landowner accepts, he executes and delivers a deed of transfer in favor of the government and surrenders the certificate of title. Within thirty days from the execution of the deed of transfer, the Land Bank of the Philippines (LBP) pays the owner the purchase price. If the landowner rejects the DAR's offer or fails to make a reply, the DAR conducts summary administrative proceedings to determine just compensation for the land. The landowner, the LBP representative and other interested parties may submit evidence on just compensation within fifteen days from notice. Within thirty days from submission, the DAR shall decide the case and inform the owner of its decision and the amount of just compensation. Upon receipt by the owner of the corresponding payment, or, in case of rejection or lack of response from the latter, the DAR shall deposit the compensation in cash or in LBP bonds with an accessible bank. The DAR shall immediately take possession of the land and cause the issuance of a transfer certificate of title in the name of the Republic of the Philippines. The land shall then be redistributed to the farmer beneficiaries. Any party may question the decision of the DAR in the regular courts for final determination of just compensation.The DAR has made compulsory acquisition the priority mode of the land acquisition to hasten the implementation of the Comprehensive Agrarian Reform Program (CARP).46Under Section 16 of the CARL, the first step in compulsory acquisition is the identification of the land, the landowners and the beneficiaries.However,the law is silent on how the identification process must be made.To fill in this gap,the DAR issued on July 26,1989 Administrative Order No.12,Series or 1989,which set the operating procedure in the identification of such lands. The procedure is as follows:II. OPERATING PROCEDUREA. The Municipal Agrarian Reform Officer,with the assistance of the pertinent Barangay Agrarian Reform Committee (BARC),shall:1. Update the masterlist of all agricultural lands covered under the CARP in his area of responsibility. The masterlist shall include such information as required under the attached CARP Masterlist Form which shall include the name of the landowner, landholding area, TCT/OCT number, and tax declaration number.2. Prepare a Compulsory Acquisition Case Folder (CACF) for each title (OCT/TCT) or landholding covered under Phase I and II of the CARP except those for which the landowners have already filed applications to avail of other modes of land acquisition. A case folder shall contain the following duly accomplished forms:a) CARP CA Form 1 MARO Investigation Reportb) CARP CA Form 2 Summary Investigation Report of Findings and Evaluationc) CARP CA Form 3 Applicant's Information Sheetd) CARP CA Form 4 Beneficiaries Undertakinge) CARP CA Form 5 Transmittal Report to the PAROThe MARO/BARC shall certify that all information contained in the above-mentioned forms have been examined and verified by him and that the same are true and correct.3. Send a Notice of Coverage and a letter of invitation to a conference/meeting to the landowner covered by the Compulsory Case Acquisition Folder.Invitations to the said conference/meeting shall also be sent to the prospective farmer-beneficiaries,the BARC representative(s),the Land Bank of the Philippines (LBP) representative,and other interested parties to discuss the inputs to the valuation of the property.He shall discuss the MARO/BARC investigation report and solicit the views,objection,agreements or suggestions of the participants thereon.The landowner shall also be asked to indicate his retention area. The minutes of the meeting shall be signed by all participants in the conference and shall form an integral part of the CACF.4. Submit all completed case folders to the Provincial Agrarian Reform Officer (PARO).B. The PARO shall:1. Ensure that the individual case folders are forwarded to him by his MAROs.2. Immediately upon receipt of a case folder, compute the valuation of the land in accordance with A.O. No. 6, Series of 1988.47The valuation worksheet and the related CACF valuation forms shall be duly certified correct by the PARO and all the personnel who participated in the accomplishment of these forms.3. In all cases, the PARO may validate the report of the MARO through ocular inspection and verification of the property. This ocular inspection and verification shall be mandatory when the computed value exceeds = 500,000 per estate.4. Upon determination of the valuation, forward the case folder, together with the duly accomplished valuation forms and his recommendations, to the Central Office. The LBP representative and the MARO concerned shall be furnished a copy each of his report.C. DAR Central Office,specifically through the Bureau of Land Acquisition and Distribution (BLAD),shall:1. Within three days from receipt of the case folder from the PARO, review, evaluate and determine the final land valuation of the property covered by the case folder. A summary review and evaluation report shall be prepared and duly certified by the BLAD Director and the personnel directly participating in the review and final valuation.2. Prepare, for the signature of the Secretary or her duly authorized representative, a Notice of Acquisition (CARP CA Form 8) for the subject property. Serve the Notice to the landowner personally or through registered mail within three days from its approval. The Notice shall include, among others, the area subject of compulsory acquisition, and the amount of just compensation offered by DAR.3. Should the landowner accept the DAR's offered value, the BLAD shall prepare and submit to the Secretary for approval the Order of Acquisition. However, in case of rejection or non-reply, the DAR Adjudication Board (DARAB) shall conduct a summary administrative hearing to determine just compensation, in accordance with the procedures provided under Administrative Order No. 13, Series of 1989. Immediately upon receipt of the DARAB's decision on just compensation, the BLAD shall prepare and submit to the Secretary for approval the required Order of Acquisition.4. Upon the landowner's receipt of payment, in case of acceptance, or upon deposit of payment in the designated bank, in case of rejection or non-response, the Secretary shall immediately direct the pertinent Register of Deeds to issue the corresponding Transfer Certificate of Title (TCT) in the name of the Republic of the Philippines. Once the property is transferred, the DAR, through the PARO, shall take possession of the land for redistribution to qualified beneficiaries.Administrative Order No. 12, Series of 1989 requires that the Municipal Agrarian Reform Officer (MARO) keep an updated master list of all agricultural lands under the CARP in his area of responsibility containing all the required information. The MARO prepares a Compulsory Acquisition Case Folder (CACF) for each title covered by CARP. The MARO then sends the landowner a "Notice of Coverage" and a "letter of invitation" to a "conference/meeting" over the land covered by the CACF. He also sends invitations to the prospective farmer-beneficiaries the representatives of the Barangay Agrarian Reform Committee (BARC), the Land Bank of the Philippines (LBP) and other interested parties to discuss the inputs to the valuation of the property and solicit views, suggestions, objections or agreements of the parties. At the meeting, the landowner is asked to indicate his retention area.The MARO shall make a report of the case to the Provincial Agrarian Reform Officer (PARO) who shall complete the valuation of the land. Ocular inspection and verification of the property by the PARO shall be mandatory when the computed value of the estate exceeds P500,000.00. Upon determination of the valuation, the PARO shall forward all papers together with his recommendation to the Central Office of the DAR. The DAR Central Office, specifically, the Bureau of Land Acquisition and Distribution (BLAD), shall review, evaluate and determine the final land valuation of the property. The BLAD shall prepare, on the signature of the Secretary or his duly authorized representative, a Notice of Acquisition for the subject property.48From this point, the provisions of Section 16 of R.A. 6657 then apply.49For a valid implementation of the CAR program, two notices are required: (1)the Notice of Coverage and letter of invitationto a preliminary conference sent to the landowner, the representatives of the BARC, LBP, farmer beneficiaries and other interested parties pursuant to DAR A.O. No. 12, Series of 1989; and (2)the Notice of Acquisitionsent to the landowner under Section 16 of the CARL.The importance of the first notice,i.e., the Notice of Coverage and the letter of invitation to the conference, and its actual conduct cannot be understated. They are steps designed to comply with the requirements of administrative due process. The implementation of the CARL is an exercise of the State's police power and the power of eminent domain. To the extent that the CARL prescribes retention limits to the landowners, there is an exercise of police power for the regulation of private property in accordance with the Constitution.50But where, to carry out such regulation, the owners are deprived of lands they own in excess of the maximum area allowed, there is also a taking under the power of eminent domain. The taking contemplated is not a mere limitation of the use of the land. What is required is the surrender of the title to and physical possession of the said excess and all beneficial rights accruing to the owner in favor of the farmer beneficiary.51The Bill of Rights provides that "[n]o person shall be deprived of life, liberty or property without due process of law."52The CARL was not intended to take away property without due process of law.53The exercise of the power of eminent domain requires that due process be observed in the taking of private property.DAR A.O. No. 12, Series of 1989, from whence the Notice of Coverage first sprung, was amended in 1990 by DAR A.O. No. 9, Series of 1990 and in 1993 by DAR A.O. No. 1, Series of 1993.The Notice of Coverage and letter of invitation to the conference meeting were expanded and amplified in said amendments.DAR A.O. No. 9, Series of 1990 entitled "Revised Rules Governing the Acquisition of Agricultural Lands Subject of Voluntary Offer to Sell and Compulsory Acquisition Pursuant to R.A. 6657," requires that:B. MARO1. Receives the duly accomplished CARP Form Nos. 1 & 1.1 including supporting documents.2. Gathers basic ownership documents listed under 1.a or 1.b above and prepares corresponding VOCF/CACF by landowner/landholding.3. Notifies/invites the landowner and representatives of the LBP, DENR, BARC and prospective beneficiaries of the schedule of ocular inspection of the property at least one week in advance.4. MARO/LAND BANK FIELD OFFICE/BARCa) Identify the land and landowner, and determine the suitability for agriculture and productivity of the land and jointly prepare Field Investigation Report (CARP Form No. 2), including the Land Use Map of the property.b) Interview applicants and assist them in the preparation of the Application For Potential CARP Beneficiary (CARP Form No. 3).c) Screen prospective farmer-beneficiaries and for those found qualified, cause the signing of the respective Application to Purchase and Farmer's Undertaking (CARP Form No. 4).d) Complete the Field Investigation Report based on the result of the ocular inspection/investigation of the property and documents submitted. See to it that Field Investigation Report is duly accomplished and signed by all concerned.5. MAROa) Assists the DENR Survey Party in the conduct of a boundary/ subdivision survey delineating areas covered by OLT, retention, subject of VOS, CA (by phases, if possible), infrastructures, etc., whichever is applicable.b) Sends Notice of Coverage (CARP Form No. 5) to landowner concerned or his duly authorized representative inviting him for a conference.c) Sends Invitation Letter (CARP Form No. 6) for a conference/public hearing to prospective farmer-beneficiaries, landowner, representatives of BARC, LBP, DENR, DA, NGO's, farmers' organizations and other interested parties to discuss the following matters:Result of Field InvestigationInputs to valuationIssues raisedComments/recommendations by all parties concerned.d) Prepares Summary of Minutes of the conference/public hearing to be guided by CARP Form No. 7.e) Forwards the completed VOCF/CACF to the Provincial Agrarian Reform Office (PARO) using CARP Form No. 8 (Transmittal Memo to PARO).xxx xxx xxxDAR A.O. No. 9, Series of 1990 lays down the rules on both Voluntary Offer to Sell (VOS) and Compulsory Acquisition (CA) transactions involving lands enumerated under Section 7 of the CARL.54In both VOS and CA. transactions, the MARO prepares the Voluntary Offer to Sell Case Folder (VOCF) and the Compulsory Acquisition Case Folder (CACF), as the case may be, over a particular landholding. The MARO notifies the landowner as well as representatives of the LBP, BARC and prospective beneficiaries of the date of the ocular inspection of the property at least one week before the scheduled date and invites them to attend the same. The MARO, LBP or BARC conducts the ocular inspection and investigation by identifying the land and landowner, determining the suitability of the land for agriculture and productivity, interviewing and screening prospective farmer beneficiaries. Based on its investigation, the MARO, LBP or BARC prepares the Field Investigation Report which shall be signed by all parties concerned. In addition to the field investigation, a boundary or subdivision survey of the land may also be conducted by a Survey Party of the Department of Environment and Natural Resources (DENR) to be assisted by the MARO.55This survey shall delineate the areas covered by Operation Land Transfer (OLT), areas retained by the landowner, areas with infrastructure, and the areas subject to VOS and CA. After the survey and field investigation, the MARO sends a "Notice of Coverage" to the landowner or his duly authorized representative inviting him to a conference or public hearing with the farmer beneficiaries, representatives of the BARC, LBP, DENR, Department of Agriculture (DA), non-government organizations, farmer's organizations and other interested parties. At the public hearing, the parties shall discuss the results of the field investigation, issues that may be raised in relation thereto, inputs to the valuation of the subject landholding, and other comments and recommendations by all parties concerned. The Minutes of the conference/public hearing shall form part of the VOCF or CACF which files shall be forwarded by the MARO to the PARO. The PARO rev