CA orders gov’t to pay ₱28.4B compensation to Hacienda Luisita owners

Metro Manila, Philippines - The Department of Agrarian Reform (DAR) and the Land Bank of the Philippines (Landbank) have been ordered to pay ₱28.48 billion to the owners of Hacienda Luisita in Tarlac as compensation for land distributed to farmers under the Comprehensive Agrarian Reform Program (CARP).

In its 35-page resolution dated April 25 and released only on Wednesday, the Court of Appeals (CA) favored Hacienda Luisita, Inc. (HLI) in reviewing the total amount of ₱28,488,944,278.71 as “just compensation” for 4,500 hectares of expropriated land at a low value in 1989.

The appellate court reversed and set aside the 2023 decision of Tarlac Regional Trial Court (RTC) Branch 63, which dismissed HLI’s plea to determine the amount for compensation.

HLI challenged Landbank’s fixed compensation of ₱304 million, with additional ₱167.4 million in interests, for parcels of sugarcane plantation in Tarlac City, La Paz and Concepcion.

The DAR adopted the value and the hectares of land were transferred to the agency to be redistributed to tiller beneficiaries under CARP.

The CA said the Tarlac court erred in denying HLI’s previous claim for more compensation and interests as the amount was “not correctly assessed and determined.”

The court said the amount to be paid to the landowner in exchange for the property taken should be “real, substantial, full, ample, just and fair, with due consideration to the factors enumerated under Section 17 of the Comprehensive Agrarian Reform Law.”

“Bearing in mind that ultimately, just compensation is about a fair and full equivalent for the loss sustained by the landowner, reliable and actual data should have been considered, with consideration to the pertinent DAR regulations applicable in the instant case,” the CA said.

The CA said it arrived at the ₱28.4 billion valuation with a formula that provides for a “more equitable and fair computation.” It said the value factored in the amount that the land may have “accrued to the aggrieved landowner’s benefit.”

Hacienda Luisita

Hacienda Luisita, previously owned by Central Azucarera de Tarlac of the Cojuangco family, is a 6,453-hectare sugar estate spanning 11 villages in Tarlac City, La Paz, and Concepcion towns.

The farmlands stirred controversy after the Cojuangco clan opted to distribute shares of stocks instead of land in line with CARP, a law enacted by then President Corazon Aquino, who was a Cojuangco.

Around 5,000 farmers filed a petition at the DAR and sought revocation of the stock distribution option (SDO) in 2003.

The department later on recommended the revocation of the SDO and issued a resolution that revoked the stock distribution, placing the 4,500 hectares of land under compulsory agrarian reform coverage for distribution.

This led to Landbank and DAR’s earlier estimation of less than half a million pesos in value for the land.

In 2024, President Ferdinand Marcos Jr. released almost 219 hectares of farmlands within Hacienda Luisita.

In a statement on Thursday, June 19, the Landbank said it was dropped as a respondent by the CA in the compensation case.

The bank said the compensation to HLI is chargeable only against the Agrarian Reform Fund (ARF) administered by the DAR.

“Landbank’s designated role is as custodian of the ARF, in charge of carrying out disbursement instructions by the DAR,” it said.

The bank added that the DAR has appealed the case, thus the CA decision is not yet final and executory.

“If sustained by the CA, DAR may elevate the case to the Supreme Court,” Landbank added.