Court Orders Government to Pay Hacienda Luisita PHP 28.49 Billion for Farmland

3The Court of Appeals (CA) has ruled in favor of Hacienda Luisita Inc. (HLI), ordering the Department of Agrarian Reform (DAR) and the Land Bank of the Philippines (LBP) to pay over P28.48 billion in just compensation for lands acquired under agrarian reform.

In a decision dated April 25, 2025, the CA’s Special 12th Division reversed an earlier ruling by the Regional Trial Court-Special Agrarian Court (RTC-SAC) in Tarlac, which had dismissed HLI’s petition seeking a fair valuation of more than 4,500 hectares of agricultural land in Tarlac City, La Paz, and Concepcion.

The issue began in 2013 when DAR told Hacienda Luisita that its land would be distributed to farmers. The Land Bank, which handles payment for the land, concluded that the value of the redistributed properties was PHP 304 million. Hacienda Luisita disagreed, saying the amount was too low and didn’t match the land’s real value.

The case stems from a long-standing dispute over lands placed under the Comprehensive Agrarian Reform Program (CARP). DAR issued notices to Hacienda Luisita in 2013, announcing the acquisition and redistribution of its land. The Land Bank set the value at around P304 million, with an additional P167 million in interest. Hacienda Luisita contested this, arguing that the valuation did not reflect its actual production value.

The appellate court found that the Regional Trial Court – Special Agrarian Court (RTC-SAC) failed to consider crucial evidence, including HLI’s audited financial records, which demonstrated higher productivity and earnings than industry benchmarks. It emphasized that just compensation must be based on actual data, not on generalized valuations.

“Just compensation is about a fair and full equivalent for the loss sustained by the landowner,” Associate Justice Raymond Reynold Lauigan wrote in the court’s decision. “Reliable and actual data should have been considered, with consideration to the pertinent DAR regulations applicable in the instant case.” 

Associate Justice Lauigan added that the use of outdated and generalized industry data by the DAR and LBP led to an inaccurate and unjust valuation. The new amount reflects the court’s recalculation of the base value plus accrued interest. Further interest may accumulate until the amount is fully settled.

References

Ayalin, A. (n.d.). DAR, Land Bank ordered to pay Hacienda Luisita P28 billion compensation. ABS-CBN. https://www.abs-cbn.com/news/regions/2025/6/18/dar-land-bank-ordered-to-pay-hacienda-luisita-p28-billion-compensation-0937

Bolledo, J. (n.d.). CA orders government to pay Hacienda Luisita P28.48 billion as ‘just compensation’. Rappler. https://www.rappler.com/philippines/court-appeals-decision-government-ordered-pay-hacienda-luisita-billions-june-2025/

Panti, L. (n.d.). DAR, Landbank ordered to pay P28 billion to Hacienda Luisita. GMA. https://www.gmanetwork.com/news/topstories/nation/949772/court-of-appeals-orders-dar-landbank-pay-p28-billion-hacienda-luisita/story/