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Apo Fruits Corp. vs.

Court of Appeals
December 4, 2009 | Bersamin | MR of the Decision of the
SC Third Division

Facts: fair value of the property as between one who receives


and one who desires to sell. It is fixed at the time of the
actual taking by the State. Thus, if property is taken for
 Apo Fruits Corp. (AFC) and Hijo Plantation Inc.
public use before compensation is deposited with the
(HPI) were owners of 5 parcels of land (1338.60
court having jurisdiction over the case, the final
has.) located in San Isidro, Tagum, Davao. On 12
compensation must include interests on its just
October 1995, the two voluntarily offered to sell the
value, to be computed from the time the property is
properties to the DAR.
taken up to the time when compensation is actually
 DAR offered P86.9M for AFC’s land and P164.40 for
paid or deposited with the court. In fine, between the
HPI’s land. AFC, HPI and DAR cannot agree on a
taking of the property and the actual payment, legal
price hence the Complaint for Determination of Just
interests accrue in order to place the owner in a position
Compensation was filed before the DAR Adjudication
as good as (but not better than) the position he was in
Board on 14 February 1997.
before the taking occurred.
 The DARAB failed to render a decision on the
valuation of the land for three years. But
nevertheless, the government deposited P26M into In the American case of Warren vs. St. Paul & Pacific
AFC’s account and P45M into HPI’s account as down Railroad Co., the US Supreme Court held that while the
payment in 1996. The DAR also caused the titling of assessed value, if paid at the date taken for the
the land in the name of the Republic of the assessment, might be just compensation, it certainly
Philippines. Later, titles were given to farmers under would not be, if payment be delayed, as might happen in
the CARP. many cases, and as did happen in this case, till several
 Due to DARAB’s failure to adjudicate, AFC and HPI years after that time. The difference is the same as
filed a complaint for determination of just between as between a sale for cash in hand and sale on
compensation before the RTC of Davao which time.
rendered a decision in favor of AFC and HPI. The
RTC ruled, based on the reports it gathered from It is explicit from the case of LBP vs. Wycoco that
assessors, that the purchase price should be higher interest on the just compensation is imposed only in
than what was offered by DAR; that the purchase case of delay in the payment thereof which must be
price should be at P103.33/ sq. m; that DAR is to sufficiently established. Given the foregoing, we find that
pay AFC and HPI a total of P1.38B. the imposition of interest on the award of just
 Upon MR, the RTC modified its earlier ruling and compensation is not justified and should therefore be
added that the DAR should, in addition to the deleted.
amount of just compensation, pay AFC and HPI
interest at a rate of 12% per annum computed from
It must be emphasized that "pertinent amounts were
the time the complaint was filed until the finality of
deposited in favor of AFC and HPI within fourteen
the decision.
months after the filing by the latter of the Complaint for
 DAR appealed to the CA, the CA reversed the RTC.
determination of just compensation before the RTC". It is
 The case was then elevated to the SC Third Division
likewise true that AFC and HPI already collected P149.6
where the Court reversed the CA ruling and affirmed and P262 million, respectively, representing just
the RTC decision with a slight modification that the
compensation for the subject properties. Clearly, there is
order to pay interest at 12% per annum be deleted no unreasonable delay in the payment of just
in its entirety.
compensation which should warrant the award of 12%
 Hence this Motion for Reconsideration. interest per annum in AFC and HPI’s favor.

Issue/Held: WoN AFC and HPI were entitled to the


payment of interest in addition to the amount of just
compensation that is due them. – NO.

Ratio:

The taking of property under the CARL is an exercise by


the State of the power of eminent domain. A basic
limitation on the State’s power of eminent domain is the
constitutional directive that private property shall not be
taken for public use without just compensation.

Just compensation refers to the sum equivalent to the


market value of the property, broadly described to be the
price fixed by the seller in open market in the usual and
ordinary course of legal action and competition, or the

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