Land Bank of the Philippines vs Heirs of Spouses Jorja Rigor-Soriano and

Magin Soriano
GR. No. 178312, 30 January 2013

Doctrine: As a contract, a compromise is perfected by mutual consent. However,

a judicial compromise, while immediately binding between the parties
upon its execution, is not executory until it is approved by the court
and reduced to a judgment. The validity of a compromise is subject to
contract requisites and principles provided by law. Moreover, the terms
and conditions of which must not be contrary to law, morals, good
customs, public policy and public order.

Subject: Compromise /Land Valuation

Facts: Petitioner filed petition for review on certiorari, seeking reversal of

decision of CA affirming earlier judgment of RTC (sitting as Special
Agrarian Court), in which Land Bank was ordered to pay respondents
(landowners) just compensation of P1,227,571.10 for 2 parcels of land
plus 6% per annum legal interest from date of taking, pursuant to RA
6657.

The properties owned by respondents (Marivel Carandang and Joseph

Soriano) became subject to Operation Land Transfer (OLT) and were
valued by petitioner and Department of Agrarian Reform (DAR) at
P10,000.00/hectare. Petitioners this too low as compared to existing
valuations of agricultural lands, hence the action for just
compensation. Considering the cavans yielded by the irrigated lands,
they asked that the properties be pegged at P1,800,000.00, as per AO
61 and RA 6657.

Land Bank, in disagreement, insisted PD 27 and EO 228 should govern

the fixing of just compensation for the properties.

During pendency of petition for review on certiorari, the parties

entered into an agreement re-evaluating the cost of the parcels of land
which was submitted to inform High Court of the Joint Motion to
Approve filed with their agreement.

Issue: Whether or not the appeal pending in the Supreme Court should be
dismissed.

Held: Yes. The said agreement was found to have complied with Art. 2028 of
the Civil Code, thus was deemed to be a judicial compromise clearly
exhibited in the intentions of both parties to end their pending
litigation by settling their dispute. Moreover, as per aforementioned
provision, had the objective been to avoid litigation, such would be
deemed extrajudicial.