Respondent Eugenio Dalauta (Dalauta) was the registered owner of an agricultural land in Florida, Butuan City, with an area of 25.2160 hectares and covered by Transfer Certificate of Title (TCT) No. T-1624. The land was placed by the Department of Agrarian Reform (DAR) under compulsory acquisition of the Comprehensive Agrarian Reform Program (CARP) as reflected in the Notice of Coverage, dated January 17, 1994, which Dalauta received on February 7, 1994. Petitioner Land Bank of the Philippines (LBP) offered ₱192,782.59 as compensation for the land, but Dalauta rejected such valuation for being too low.

The case was referred to the DAR Adjudication Board (DARAB) through the Provincial Agrarian Reform Adjudicator (PARAD) of Butuan City. A summary administrative proceeding was conducted to determine the appropriate just compensation for the subject property. In its Resolution, dated December 4, 1995, the PARAD affirmed the valuation made by LBP in the amount of ₱192,782.59.

On February 28, 2000, Dalauta filed a petition for determination of just compensation with the RTC, sitting as SAC. He alleged that LBP’s valuation of the land was inconsistent with the rules and regulations prescribed in DAR Administrative Order (A.O.) No. 06, series of 1992, for determining the just compensation of lands covered by CARP’s compulsory acquisition scheme.

The RTC acting as a Special Agrarian Court rendered its decision in favor of the Respondent.

Unsatisfied, LBP filed a motion for reconsideration, but it was denied by the SAC.

Hence, LBP filed a petition for review under Rule 42 of the Rules of Court before the CA. The CA ruled that the SAC correctly took cognizance of the case. Not in conformity, LBP filed this petition to the SC.

Whether the trial court acting as a Special Agrarian Court had properly taken jurisdiction over the case despite the finality of the PARAD Resolution.

Yes, the DARAB that the power to decide just compensation cases for the taking of lands under R.A. No. 6657 is vested in the courts. It is error to think that, because of Rule XIII, the original and exclusive jurisdiction given to the courts to decide petitions for determination of just compensation has thereby been transformed into an appellate jurisdiction. It only means that, in accordance with settled principles of administrative law, primary jurisdiction is vested in the DAR as an administrative agency to determine in a preliminary manner the reasonable compensation to be paid for the lands taken under the Comprehensive Agrarian Reform Program, but such determination is subject to challenge in the courts.

The jurisdiction of the Regional Trial Courts is not any less “original and exclusive” because the question is first passed upon by the DAR, as the judicial proceedings are not a continuation of the administrative determination. For that matter, the law may provide that the decision of the DAR is final and unappealable.

Nevertheless, resort to the courts cannot be foreclosed on the theory that courts are the guarantors of the legality of administrative action.


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