1.

Meneses vs Secretary of Agrarian Reform (2006) Justiniano

I. Regional Trial Court of Bulacan:

1. Petitioners filed a complaint for determination and payment of just compensation. Reason:
Petitioners alleged that from the time the land was distributed to farmer-beneficiaries in 1972 up to the
time of the filing of the complaint, no payment or rentals has been made, and titles have already been
issued to the farmer-beneficiaries. Petitioners also alleged that the fair market value of the property is
P6,000,000.00.

2. The farmer-beneficiaries, the Land Bank of the Philippines-Land Valuation and Landowners'
Compensation III (LBP-LVLCO III), the Department of Agrarian Reform (DAR) Secretary, and the DAR all
filed their respective Answers. For their part, the farmer-beneficiaries alleged that the land valuation
establishing the average gross production per hectare by the Barangay Committee on Land Production
(BCLP) based on three normal crop years before P.D. No. 27 is in accordance with the existing guidelines
and procedure on Operation Land Transfer; they have no unpaid rentals; and jurisdiction over the case
lies with the Department of Agrarian Reform Adjudication Board (DARAB).

3. Meanwhile, the LBP-LVLCO III averred that it has been acting in good faith in discharging its
obligations, and that the computation was obtained through the valuation processes of the DAR on
lands covered by P.D. No. 27 and Executive Order No. 228 (E.O. No. 228). The LBP-LVLCO III likewise
alleged that jurisdiction over the case lies with the DARAB.
4. The DAR Secretary, on the other hand, alleged that the valuation of the property was
pursuant to the Operation Land Transfer under P.D. No. 27 and the reckoning date should be at the time
of the taking of the property, i.e., October 21, 1972.
5. DAR claimed that the filing of the case is premature since there is no valuation yet made by
the DAR based on E.O. No. 228, and petitioners must cooperate with the DAR by submitting all the
necessary papers for proper valuation and expeditious payment of the land. The DAR also claimed that it
must first determine the valuation before resort to the court can be made.
6. RTC dismissed the complaint for lack of cause of action. Reason: The determination of just
compensation must first be filed with the DAR and not the Special Agrarian Court.
7. Petitioners filed a motion for reconsideration. The RTC partially granted the motion; it set
aside its order of dismissal, ordering the suspension of the proceedings and archiving the case until
primary determination has been made on the issue of just compensation.
II. Department of Agrarian Reform Adjudication Board:
1. Petitioners filed a complaint for determination and payment of just compensation.
2. DARAB dismissed the complaint on the ground that it has no jurisdiction to hear and decide
valuation cases covered by P.D. No. 27, as the same is within the exclusive administrative powers of the
Office of the Secretary.
III. RTC of Bulacan
1. Because of the foregoing dismissal, petitioners filed with the RTC a motion to re-open and
calendar case for hearing, which was granted by the RTC.
 2. The RTC, with the agreement of the parties, constituted Commissioners to determine just
compensation, but the same was dissolved per its Report and Recommendation dated October 9,
1996, as granted by the RTC in its Order dated October 11, 1996.
3. Pre-trial was terminated on July 10, 1997. The parties agreed as to the issue to be resolved -
"whether or not the plaintiffs [petitioners] are entitled to just compensation as provided for in Republic
Act No. 6657 (R.A. No. 6657) and the Constitution of 1987 and not P.D. No. 27 which was the basis of
valuation made by defendants Secretary of Agrarian Reform and the Land Bank of the Philippines of the
subject parcel of land which was acquired in October 21, 1972."
4. The RTC rendered its decision dismissing the complaint. Reason: Since the subject property
was taken from petitioners on October 21, 1972 under the DAR's Operation Land Transfer pursuant
to P.D. No. 27, then just compensation must be based on the value of the property at the time of taking.

IV. Court of Appeals:

1. Petitioners filed an appeal, wherein they prayed for a remand of the case to the RTC for
further proceedings and/or reception of evidence on the just and fair market value of the property.
2. The CA dismissed the appeal.
3. Motion for Reconsideration was denied on the grounds that it was filed 44 days late and the
CA found no cogent reason to reverse or modify its decision.
V. Supreme Court:
1. Petitioners filed a petition for review on certiorari.
2. Petitioners argue that the CA erred in sustaining the propriety of the motion for judgment on
the pleadings filed by respondents with the RTC. It was the CA's ruling that the motion for judgment on
the pleadings was proper since respondents can be considered as plaintiffs in a counter-claim.
Petitioners also impute error in the CA's ruling that the RTC properly dismissed the case since it appears
that there was no initial valuation yet made by the DARAB.
3. Respondents, however, argue that the CA Decision dated May 30, 2002 is already final and
executory due to petitioners' failure to seasonably file a motion for reconsideration. Respondents also
argue, among others, that the applicable law in this case is P.D. No. 27 and E.O. No. 228, which provides
for the formula for the determination of just compensation, as recognized in the cases of Land Bank of
the Philippines v. Court of Appeals, 378 Phil. 1248 (1999), and Gabatin v. Land Bank of the Philippines,
G.R. No. 148223, November 25, 2004, 444 SCRA 176.
Held: The Courts finds merit in the petition.
On the propriety of the filing of a motion for judgment on the pleadings by the LBP and adopted
by the DAR Secretary — the Court finds that the CA erred in sustaining its propriety.
Rule 34, Section 1 of the Rules of Court, provides that a judgment on the pleadings is proper
when an answer fails to render an issue or otherwise admits the material allegations of the adverse
party's pleading. The essential question is whether there are issues generated by the pleadings. A
judgment on the pleadings may be sought only by a claimant, who is the party seeking to recover upon a
claim, counterclaim or cross-claim; or to obtain a declaratory relief. 29
In this case, the separate Answers filed by the respondents definitely tendered issues, as it made
specific denials of the material allegations in the complaint and asserted affirmative defenses, which
would bar recovery by petitioners. Moreover, it was erroneous for the RTC to require the filing of a
motion for judgment on the pleadings and for the LBP and the DAR Secretary to file the same since in the
first place, the latter are neither plaintiffs in the case nor counter-claimants or cross-claimants.
What the RTC obviously meant to be filed was a motion for summary judgment, a procedural
device designed for the prompt disposition of actions, which may be rendered if the pleadings,
supporting affidavits, depositions and admissions on file show that, after a summary hearing, there is no
genuine issue regarding any material fact, except as to the amount of damages, and the moving party is
entitled to a judgment as a matter of law, and which may be applied for by either a claimant or a
defending party. This is obvious from the fact that although the Answers raised issues, these were not
factual ones requiring trial, nor were they genuine issues, as the parties were able to agree to limit the
same to whether petitioners are entitled to just compensation under R.A. No. 6657 and not P.D. No. 27.
The Court also finds that the CA erred in sustaining the RTC ruling that just compensation in this
case should be based on the value of the property at the time of taking, October 21, 1972, which is the
effectivity date of P.D. No. 27.
Under the circumstances of this case, the Court deems it more equitable to apply the ruling in
the Natividad case. In said case, the Court applied the provisions of R.A. No. 6657 in computing just
compensation for property expropriated under P.D. No. 27, stating, viz.:
Land Bank's 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. In Office of the President,
Malacañang, Manila v. 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.
Under the factual circumstances of this case, the agrarian reform process is
still incomplete as the just compensation to be paid private respondents has yet to be
settled. Considering the passage of Republic Act No. 6657 (RA 6657) before the
completion of this process, the just compensation should be determined and the
process concluded under the said law. Indeed, RA 6657 is the applicable law, with PD
27 and EO 228 having only suppletory effect, conformably with our ruling in Paris v.
Alfeche.
xxx xxx xxx
It would certainly be inequitable to determine just compensation based on
the guideline provided by PD 27 and EO 228 considering the DAR's failure to
determine the just compensation for a considerable length of time. That just
compensation should be determined in accordance with RA 6657, and not PD 27 or 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 case, the trial court arrived at the just compensation due private
respondents for their property, taking into account its nature as irrigated land,
location along the highway, market value, assessor's value and the volume and value
of its produce. This Court is convinced that the trial court correctly determined the
 amount of just compensation due private respondents in accordance with, and guided
by, RA 6657 and existing jurisprudence. 35 (Emphasis supplied)
As previously noted, the property was expropriated under the Operation Land Transfer scheme
of P.D. No. 27 way back in 1972. More than 30 years have passed and petitioners are yet to benefit from
it, while the farmer-beneficiaries have already been harvesting its produce for the longest time. Events
have rendered the applicability ofP.D. No. 27 inequitable. Thus, the provisions of R.A. No. 6657 should
apply in this case.
Finally, the Court sustains petitioners' contention that the CA erred in ruling that the RTC
correctly dismissed their complaint. Even assuming that the RTC was correct in holding that P.D. No.
27 applies, still it should not have simply dismissed the complaint after resolving the issue of which law
should apply. Instead, it should have proceeded to determine the just compensation due to petitioners.
Records show that the complaint for just compensation was first filed in the RTC, but this was
dismissed in the Order dated June 22, 1994, for the reason that the determination of just compensation
must first be filed with the DAR. Conformably with said ruling, petitioners filed the complaint with the
DAR, which dismissed the same on the ground that it has no jurisdiction to hear and decide valuation
cases covered by P.D. No. 27. Because of said dismissal, petitioners went back to the RTC for the re-
opening of the case. Petitioners' case was obviously thrown back and forth between the two venues,
and with the RTC's second dismissal, they were left hanging and without any recourse, which, of course,
is iniquitous considering that their property has already long been expropriated by the government and
its fruits enjoyed by the farmer-beneficiaries.
WHEREFORE, the petition is GRANTED. The Decision rendered by the CA is reversed and set
aside. The records of this case is ordered REMANDED to Regional Trial Court (RTC) of Bulacan, Branch
13, for further proceedings with deliberate dispatch and in accordance with the Court's discussion in this
Decision.