The Court of Appeals (CA) has directed the Department of Agrarian Reform (DAR) and the state-owned Land Bank of the Philippines (LBP) to pay Hacienda Luisita Inc. (HLI) ₱28 billion as just compensation, in line with a Supreme Court ruling mandating the distribution of the estate’s land-to-farmer beneficiaries.
In its 35-page ruling, the CA found that the Tarlac City Regional Trial Court–Special Agrarian Court (RTC-SAC) had miscalculated the compensation due to HLI. The appellate court emphasized that payment for the expropriated property must be “real, substantial, full, ample, just and fair,” taking into account the criteria outlined in Section 17 of the Comprehensive Agrarian Reform Law, which governs the determination of just compensation.
The ruling pertains to 4,500 hectares of Hacienda Luisita land owned by the Cojuangco family.
With this decision, the CA granted Hacienda Luisita Inc.’s (HLI) petition for review and nullified the February 15, 2023, decision and the August 11, 2023, resolution issued by the Tarlac City Regional Trial Court-Branch 63, which served as the Special Agrarian Court.
“Respondents are ordered to pay petitioner the total amount of P28,488,944,278.71 as just compensation as of 30 April 2025, without prejudice to the accrual of interest until fully paid,” the CA said.
The appellate court ruled that the RTC-Special Agrarian Court “erred” in its decision, emphasizing that “reliable and actual data should have been considered” in line with DAR regulations when determining the “fair and full equivalent for the loss sustained by the landowner.”
“There was data submitted by petitioner HLI for the computation of the Average Gross Income and that it was rejected by DAR Adjudication Board on the purported claim that it was not accurate. There was, however, no proof provided in the said DAR Adjudication Board decision that no data was submitted by the landowner [HLI] or that the data that HLI submitted cannot be verified or validated,” the CA added.
The CA also noted that the RTC-Special Agrarian Court reiterated and adopted the conclusions of the DAR Adjudication Board, which had based its valuations on assessments made by the DAR and the Land Bank of the Philippines.
“To this Court, petitioner should be compensated fairly and fully in accordance with the equivalent loss sustained by it as landowner. In this regard, an examination of the circumstances of the case at bench showed that the RTC-SAC erred when it did not take into account the actual production value in the determination on how much is the correct just compensation due to petitioner HLI and when it simply affirmed the LBP and DAR’s use of industry standard values in determining the land valuation of the CARP acquired properties,” the CA said.
“In this case, there was a clear admission on the part of DAR in its Answer that petitioner HLI’s Audited Financial Statement was available and submitted to them, only that they deny considering them on the general claim, without more, that they cannot be verified or validated. We also checked the Answer with Affirmative Defense filed by LBP, but it was not explained therein how the petitioner HLI’s data could not be validated or verified,” the CA added.
The CA explained that the ₱28 billion compensation was calculated using a specific formula that “provides a more equitable and fair computation of just compensation,” as it takes into account multiple factors affecting not only the property’s value at the time it was taken, but also the potential earnings the landowner could have gained.
“We have also taken into consideration that in computing the land value, the amounts already received by the petitioner in the sum of P471,501,417.98 million should be properly deducted in 2013. Thus, as it shows, the amount of just compensation due to the subject property is Php28,488,944,278.71 as of 30 April 2025,” the CA said.