SC orders Land Bank to pay fruit farm owners 1.33 billion

MANILA, Philippines — To ensure the success of its agrarian reform program, the government must always show good faith in dealing with farmers, said the Supreme Court as it dismissed the appeal filed by Land Bank of the Philippines, requiring them to pay P1.33 billion in interest to owners of Davao based fruit farms.

In a 20-page decision, the high court dismissed the second motion for reconsideration filed by Land Bank of the Philippines (LBP) seeking a removal of the 12 percent interest per annum on the unpaid balance of the just compensation due to Apo Fruits Corporation (AFC) and Hijo Plantation Inc. (HPI).

The high court, in the decision authored by Associate Justice Arturo Brion said that the lower court’s valuation of the properties of AFC and HPI was the correct valuation because it was based on Commissioner’s, appraiser’s reports, schedule of market values of the City of Tagum per its 1993 and 1994 Revision of Assessment and Property Classification, among others.

On the other hand, LBP’s valuation was only P251,379 million which was P1.131 billion different from the valuation of that of the court. According to the high court, LBP’s valuation shows lack of good faith on the part of the government in dealing with land owners.

The high court also noted the delay on part of the government to pay the landowners, causing them to lose income. The government took AFC and HPI’s land in 1996 but full payment was made only in 2008.

“This case involves the government’s agrarian reform program whose success largely depends on the willingness of the participants, both the farmer-beneficiaries and the landowners to cooperate with the government. Inevitably, if the government falters or is seen to be faltering through lack of good faith in implementing the needed reforms, including any hesitation in paying the landowners just compensation, this reform program and its objectives would suffer major setbacks,” the high court said.

The Supreme Court, in its decision last year which it has affirmed in this resolution said that unless the parties agree to a shorter payment period, payment shall be in monthly instalments at the rate of P60 million per month until the whole amount including the interest was fully paid.