gathered by the DAR, through the LBP, as the administrative agency mandated by law to make an initial determination of the valuation of the parcels of agricultural land acquired for land reform.

We agree.

That it is the RTC, sitting as a SAC, which has the power to determine just compensation for parcels of land acquired by the State, pursuant to the agrarian reform program, is made clear in Section 57 of RA 6657, which reads:

Section 57. Special Jurisdiction. - The Special Agrarian Courts shall have original and exclusive jurisdiction over all petitions for the determination of just compensation to landowners, and the prosecution of all criminal offenses under this Act. The Rules of Court shall apply to all proceedings before the Special Agrarian Courts unless modified by this Act.

The Special Agrarian Courts shall decide all appropriate cases under their special jurisdiction within thirty (30) days from submission of the case for decision.

To guide the RTC in this function, Section 17 of RA 6657 enumerates the factors that have to be taken into consideration to accurately determine just compensation. This provision states:

Section 17. Determination of Just Compensation. In determining just compensation, the cost of acquisition of the land, the current value of like properties, its nature, actual use and income, the sworn valuation by the owner, the tax declarations, and the assessment made by government assessors, shall be considered. The social and economic benefits contributed by the farmers and the farmworkers and by the Government to the property, as well as the non-payment of taxes or loans secured from any government financing institution on the said land, shall be considered as additional factors to determine its valuation.

These factors enumerated in Section 17 have been translated into a basic formula in DAR Administrative Order No. 6, Series of 1992, as amended by DAR Administrative Order No. 11, Series of 1994, issued pursuant to the DAR's rule-making power to carry out the object and purposes of R.A. 6657, as amended. [emphases ours]

In Landbank of the Philippines v. Celada, 23 we emphasized the duty of the RTC to apply the formula provided in the applicable DAR AO to determine just compensation, stating that:

While [the RTC) is required to consider the acquisition cost of the land, the current value of like properties, its nature, actual use and income, the sworn valuation by the owner the tax declaration and the assessments made by the government assessors to determine just compensation, it is equally true that these factors have been translated into a basic formula by the DAR pursuant to its rule-making power under Section 49 of R.A. No. 6657. As the government agency principally tasked to implement the agrarian reform program, it is the DAR's duty to issue rules and regulations to carry out the object of the law. (The) DAR [Administrative Order] precisely "filled in the details" of the Section 17, R.A. No. 6657 by providing a basic formula by which the factors mentioned therein may be taken into account. The (RTC) was at no liberty to disregard the formula which was devised to implement the said provision.

It is elementary that rules and regulations issued by administrative bodies to interpret the law which they are entrusted to enforce, have the force of law, and are entitled to great respect. Administrative issuances partake of the nature of a statute and have in their favor a presumption of legality. As such, courts cannot ignore administrative issuances especially when, as in this case, its validity was not put in issue. Unless an administrative order is declared invalid, courts have no option but to apply the same. [emphases ours]

We reiterated the mandatory application of the formula in the applicable DAR administrative regulations in Land Bank of the Philippines v. Lim, 24 Land Bank of the Philippines v. Heirs of Eleuterio Cruz, 25 and

Land Bank of the Philippines v. Barrido.26 In Barrido, we were explicit in stating that:

While the determination of just compensation is essentially a judicial function vested in the RTC acting as a Special Agrarian Court, the judge cannot abuse his discretion by not taking into full consideration the factors specifically identified by law and implementing rules. Special Agrarian Courts are not at liberty to disregard the formula laid down in DAR A.O. No. 5, series of 1998, because unless an administrative order is declared invalid, courts have no option but to apply it. The courts cannot ignore, without violating the agrarian law, the formula provided by the DAR for determination of just compensation.27 (emphases ours)

These rulings plainly impose on the RTC the duly to apply the formula laid down in the pertinent DAR administrative regulations to determine just compensation. Clearly, the CA and the RTC acted with grievous error when they disregarded the formula laid down by the DAR, and close instead to come up with their own basis for the valuation of the subject land.

Hearing necessary before RTC takes judicial notice of nature of land

Apart from disregarding the formula found in the applicable DAR AO, the RTC, and, correspondingly, the CA, when it affirmed the trial court, committed further error in concluding that the 10 hectares of the subject property is commercial land after taking judicial notice of the fact that this portion of land is near Sitio Curvada, Pitago, Cataingan, a commercial district.

While the lower court is not precluded from taking judicial notice of certain facts, it must exercise this right within the clear boundary provided by Section 3, Rule 129 of the Rules of Court, which provides:

Section 3. Judicial notice, when hearing necessary. During the trial, the court, on its own initiative, or on request of a party, may announce its intention to take judicial notice of any matter and allow the parties to be heard thereon.

After the trial and before judgment or on appeal, the proper court, on its own initiative, or on request of a party, may take judicial notice of any matter and allow the parties to be heard thereon if such matter is decisive of a material issue in the case. [emphases ours]

The classification of the land is obviously essential to the valuation of the subject property, which is the very issue in the present case. The parties should thus have been given the opportunity to present evidence on the nature of the property before the lower court took judicial notice of the commercial nature of a portion of the subject landholdings. As we said in Land Bank of the Phils. v. Wycoco:28

The power to take judicial notice is to be exercised by courts with caution especially where the case involves a vast tract of land. Care must be taken that the requisite notoriety exists; and every reasonable doubt on the subject should be promptly resolved in the negative. To say that a court will take judicial notice of a fact is merely another way of saying that the usual form of evidence will be dispensed with if knowledge of the fact can be otherwise acquired. This is because the court assumes that the matter is so notorious that it will not be disputed. But judicial notice is not judicial knowledge. The mere personal knowledge of the judge is not the judicial knowledge of the court, and he is not authorized to make his individual knowledge of a fact, not generally or professionally known, the basis of his action.

In these lights, we find that a remand of this case to the court of origin is necessary for the determination of just compensation, in accordance with the formula stated in DAR AO No. 6, series of 1992, as amended by DAR AO No. 11, series of 1994, which are the applicable issuances on fixing just compensation.

Payment through trust account

As a final point, we have not failed to notice that the LBP in this case made use of trust accounts to pay Honeycomb Farms. In Land Bank of the Phil. v. CA, 29 this Court

struck down as void DAR Administrative Circular No. 9, Series of 1990, providing for the opening of trust accounts in lieu of the deposit in cash or in bonds contemplated in Section 16(e) of RA 6657. We said:

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It is very explicit [ from Section 16(e) that the deposit must be made only in "cash" on in "LBP bonds." Nowhere does it appear nor can it be inferred that the deposit can be made in any other form. If it were the intention to include a "trust account" among the valid modes of deposit, that should have been made express, or at least, qualifying words ought to have a appeared from which it can be fairly deduced that a "trust account" is allowed. In sum, there is no ambiguity in Section 16(e) of RA 6657 to warrant an expanded construction of the term "deposit."

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In the present suit, the DAR clearly overstepped the limits of its power to enact rules and regulations when it issued Administrative Circular No. 9. There is no basis in allowing the opening of a trust account in behalf of the landowner as compensation for his property because, as heretofore discussed, Section 16(e) of RA 6657 is very specific that the deposit must be made only in "cash" on in "LBP bonds." In the same vein, petitioners cannot invoke LRA Circular Nos. 29, 29-A and 54 because these implementing regulations cannot outweigh the clear provision of the law. Respondent court therefore did not commit any error in striking down Administrative Circular No. 9 for being null and void.30

Recognizing that the belated conversion of the trust account into a deposit account failed to address the injustice caused to the landowner by the delay in its receipt of the just compensation due, we held in Wycoco that:

In light of the foregoing, the trust account opened by LBP in the name of Wycoco as the mode of payment of just compensation should be converted to a deposit account. Such conversion should be retroactive in application in order to rectify the error committed by the DAR in opening a trust account and to grant the landowners the benefits concomitant to payment in cash or LBP bonds prior to the ruling of the Court in Land Bank of the Philippines v. Court of Appeals. Otherwise, petitioner's right to payment of just and valid compensation for the expropriation of his property would be violated. The interest earnings accruing on the deposit account of landowners would suffice to compensate them pending payment of just compensation.

In some expropriation cases, the Court imposed an interest of 12% per annum on the just compensation due the landowner. It must be stressed, however, that in these cases, the imposition of interest was in the nature of damages for delay in payment which in effect makes the obligation on the part of the government one of forbearance. It follows that the interest in the form of damages cannot be applied where there was prompt and valid payment of just compensation. Conversely, where there was delay in tendering a valid payment of just compensation, imposition of interest is in order. This is because the replacement of the trust account with cash or LBP bonds did not ipso facto cure the lack of compensation; for essentially, the determination of this compensation was marred by lack of due process.

Accordingly, the just compensation due Wycoco should bear 12% interest per annum from the time LBP opened a trust account in his name up to the time said account was actually converted into cash and LBP bonds deposit accounts. The basis of the 12% interest would be the just compensation that would be determined by the Special Agrarian Court upon remand of the instant case. In the same vein, the amount determined by the Special Agrarian Court would also be the basis of the interest income on the cash and bond deposits due, Wycoco from the time of the taking of the property up to the time of actual payment of just compensation. 31 (emphases ours)

In line with this ruling, the LBP is instructed to immediately convert the trust account opened in the name of Honeycomb Farms to deposit account. Furthermore, the just compensation due Honeycomb Farms, as determined by the RTC, should bear 12% interest per annum from the time LBP opened the trust account in its name until the account is convert into cash and LBP bonds deposit accounts.

WHEREFORE, premises considered, the petition is GRANTED. Special Civil Case No. 4323 is REMANDED to the Regional Trial Court of Masbate, Masbate, Branch 48, for the determination of just compensation, based on the applicable administrative orders of the Department of Agrarian Reform, subject to a 12% interest per annum from the time the Land Bank of the Philippines opened the trust account for respondent Honeycomb Farms Corporation up to the time this account is actually converted into cash and LBP bonds deposit accounts.

SO ORDERED.

Carpio, Perez, Sereno and Reyes, JJ.,

concur.

ATTESTATION

I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court's Division

(Sgd.) ANTONIO T. CARPIO Associate Justice Chairperson, Second Division

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairperson's Attestation, I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court's Division.

(Sgd.) RENATO C. CORONA Chief Justice

[G.R. No. 192565. February 28, 2012]

EN BANC

UNION BANK OF THE PHILIPPINES and DESI TOMAS, Petitioners, vs. PEOPLE OF THE PHILIPPINES, Respondent.

SYLLABUS

of the Ruling of the Court

1. REMEDIAL LAW; CRIMINAL PROCEDURE; VENUE; VENUE IS AN ESSENTIAL ELEMENT OF JURISDICTION; RATIONALE. - Venue is an essential element of jurisdiction in criminal cases. It determines not only the place where the criminal action is to be instituted, but also the court that has the jurisdiction to try and hear the case. The reason for this rule is two-fold. First, the jurisdiction of trial courts is limited to well-defined territories such that a trial court can only hear and try cases involving crimes committed within its territorial jurisdiction. Second, laying the venue in the locus criminis is grounded on the necessity and justice of having an accused on trial in the municipality of province where witnesses and other facilities for his defense are available. Unlike in civil cases, a finding of improper venue in criminal cases carries jurisdictional consequences.

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2. ID.; ID.; ID.; THE VENUE AND JURISDICTION OVER CRIMINAL CASES SHOULD NOT ONLY BE IN THE COURT WHERE THE OFFENSE WAS COMMITTED BUT ALSO WHERE ANY OF ITS ESSENTIAL INGREDIENTS TOOK PLACE.-In determining the venue where the criminal action is to be instituted and the court which has jurisdiction over it, Section 15(a), Rule 110 of the 2000 Revised Rules of Criminal Procedure should be read in light of Section 10, Rule 110 of the 2000 Revised Rules of Criminal Procedure Both provisions categorically place the venue and jurisdiction over criminal cases not only in the court where the offense was committed, but also where any of its essential ingredients took place. In other words, the venue of action and of jurisdiction are deemed sufficiently alleged where the Information states that the offense was committed or some of its essential ingredients occurred at a place within the territorial jurisdiction of the court.

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