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Department of Agrarian Reform, represented by Secretary Jose Mari B. Ponce (OIC) vs Delia T. Sutton, Ella T.

Sutton-Soliman and Harry T. Sutton G.R. No.162070 Facts: This is a petition for review filed by the Department of Agrarian Reform (DAR) of the Decision and Resolution of the Court of Appeals, dated September 19, 2003 and February 4, 2004, respectively, which declared DAR Administrative Order (A.O.) No. 9, series of 1993, null and void for being violative of the Constitution. The case involves a land in Aroroy, Masbate, inherited by respondents which has been devoted exclusively to cow and calf breeding. On October 26, 1987, pursuant to the then existing agrarian reform program of the government, respondents made a voluntary offer to sell (VOS) their landholdings to petitioner DAR to avail of certain incentives under the law. On June 10, 1988, a new agrarian law, Republic Act (R.A.) No. 6657, also known as the Comprehensive Agrarian Reform Law (CARL) of 1988, took effect. It included in its coverage farms used for raising livestock, poultry and swine. On December 4, 1990, in an en banc decision in the case of Luz Farms v. Secretary of DAR, the Court ruled that lands devoted to livestock and poultry-raising are not included in the definition of agricultural land and declared as unconstitutional certain provisions of the CARL insofar as they included livestock farms in the coverage of agrarian reform. In view of this, respondents filed with petitioner DAR a formal request to withdraw their VOS as their landholding was devoted exclusively to cattle-raising and thus exempted from the coverage of the CARL. On December 21, 1992, the Municipal Agrarian Reform Officer of Aroroy, Masbate, inspected respondents' land and found that it was devoted solely to cattle-raising and breeding. He recommended to the DAR Secretary that it be exempted from the coverage of the CARL. On April 27, 1993, respondents reiterated to petitioner DAR the withdrawal of their VOS and requested the return of the supporting papers they submitted in connection therewith. Petitioner ignored such request. On December 27, 1993, DAR issued A.O. No. 9, series of 1993, which provided that only portions of private agricultural lands used for the raising of livestock, poultry and swine as of June 15, 1988 shall be excluded from the coverage of the CARL. In determining the area of land to be excluded, the A.O. fixed the following retention limits, viz.: 1:1 animal-land ratio and a ratio of 1.7815 hectares for livestock infrastructure for every 21 heads of cattle shall likewise be excluded from the operations of the CARL. On February 4, 1994, respondents wrote the DAR Secretary and advised him to consider as final and irrevocable the withdrawal of their VOS as, under the Luz Farms doctrine, their entire landholding is exempted from the CARL. On September 14, 1995, then DAR Secretary Ernesto D. Garilao issued an Order partially granting the application of respondents for exemption from the coverage of CARL. Applying the retention limits outlined in the DAR A.O. No. 9, petitioner exempted 1,209 hectares of respondents' land for grazing purposes, and a maximum of 102.5635 hectares for infrastructure. Petitioner ordered the rest of respondents' landholding to be segregated and placed under Compulsory Acquisition. Respondents moved for reconsideration, contending that their entire landholding should be exempted as it is devoted exclusively to cattle-raising. Said motion was denied. Respondents filed a notice of appeal with the Office of the President assailing: (1) the reasonableness and

validity of DAR A.O. No. 9, s. 1993, which provided for a ratio between land and livestock in determining the land area qualified for exclusion from the CARL, and (2) the constitutionality of DAR A.O. No. 9, s. 1993, in view of the Luz Farms case which declared cattle-raising lands excluded from the coverage of agrarian reform. The OP affirmed the impugned order. On appeal to CA, the CA ruled in favor of respondents and declared A.O. No. 9, Series of 1993 as void. Issue: Whether or not DAR Administrative Order No. 09, Series of 1993 which prescribes a maximum retention for owners of lands devoted to livestock raising is constitutional?

Held: The impugned A.O. is invalid as it contravenes the Constitution. The A.O. sought to regulate livestock farms by including them in the coverage of agrarian reform and prescribing a maximum retention limit for their ownership. However, the deliberations of the 1987 Constitutional Commission show a clear intent to exclude, inter alia, all lands exclusively devoted to livestock, swine and poultry-raising. The Court clarified in the Luz Farms case that livestock, swine and poultry-raising are industrial activities and do not fall within the definition of "agriculture" or "agricultural activity." The raising of livestock, swine and poultry is different from crop or tree farming. It is an industrial, not an agricultural, activity. A great portion of the investment in this enterprise is in the form of industrial fixed assets, such as: animal housing structures and facilities, drainage, waterers and blowers, feedmill with grinders, mixers, conveyors, exhausts and generators, extensive warehousing facilities for feeds and other supplies, anti-pollution equipment like bio-gas and digester plants augmented by lagoons and concrete ponds, deepwells, elevated water tanks, pumphouses, sprayers, and other technological appurtenance. Petitioner DAR has no power to regulate livestock farms which have been exempted by the Constitution from the coverage of agrarian reform. It has exceeded its power in issuing the assailed A.O. Moreover, it is a fundamental rule of statutory construction that the reenactment of a statute by Congress without substantial change is an implied legislative approval and adoption of the previous law. On the other hand, by making a new law, Congress seeks to supersede an earlier one. In the case at bar, after the passage of the 1988 CARL, Congress enacted R.A. No. 7881 which amended certain provisions of the CARL. Specifically, the new law changed the definition of the terms "agricultural activity" and "commercial farming" by dropping from its coverage lands that are devoted to commercial livestock, poultry and swine-raising. With this significant modification, Congress clearly sought to align the provisions of our agrarian laws with the intent of the 1987 Constitutional Commission to exclude livestock farms from the coverage of agrarian reform. It is doctrinal that rules of administrative bodies must be in harmony with the provisions of the Constitution. They cannot amend or extend the Constitution. To be valid, they must conform to and be consistent with the Constitution. In case of conflict between an administrative order and the provisions of the Constitution, the latter prevails. The assailed A.O. of petitioner DAR was properly stricken down as unconstitutional as it enlarges the coverage of agrarian reform beyond the scope intended by the 1987 Constitution.

CASTILLO v. TOLENTINO, G.R. No. 181525, March 4, 2009 Tolentino was the owner of two parcels of land and a caretaker of another. The said parcels were tenanted by Castillo who promised to remit lease rentals to Tolentino. Castillo wrote the PARO informing the latter of his intention to construct a water reservoir. Tolentino also received a copy of the letter and opposed the same. Despite this, Castillo proceeded with the construction of the water dike. Tolentino filed a case for ejectment. PARAD ruled for the ejectment of Castillo. DARAB initially affirmed the Decision but reversed itself in a Motion for Reconsideration. CA reinstated the Decision of the PARAD since it held that the appeal was filed out of time. 1. OBLIGATIONS OF A TENANT WITH RESPECT TO CONSTRUCTION OF IMPROVEMENTS ON THE LANDHOLDING Section 32 of R.A. No. 3844 specifically requires notice to and consent of the agricultural lessor before the agricultural lessee may embark upon the construction of a permanent irrigation system. It is only when the former refuses to bear the expenses of construction that the latter may choose to shoulder the same. More importantly, any change in the use of tillable land in the leasehold, e.g. through the construction of a sizeable water reservoir, impacts upon the agricultural lessor's share in the harvest, which is the only consideration he receives under the agrarian law. This being the case, before the agricultural lessee may use the leasehold for a purpose other than what had been agreed upon, the consent of the agricultural lessor must be obtained, lest he be dispossessed of his leasehold. The law (Sec. 32 of R.A. No. 3844) does not give blanket authority to the agricultural lessee to construct an irrigation system at anytime and for any reason; instead, it presupposes primarily that the same is necessary. 2. IMPLIED OBLIGATION OF A TENANT The fact that CASTILLO was convicted by final judgment of an offense against TOLENTINO's son, George, demonstrates how relations between the two have deteriorated. While R.A. No. 3844 authorizes termination by the agricultural lessee of the lease for a crime committed by the agricultural lessor against the former or any member of his immediate farm household, the same privilege is not granted to the agricultural lessor. Yet, this does not mean that the courts should not take into account the circumstance that the agricultural lessee committed a crime against the agricultural lessor or any member of his immediate family. By committing a crime against TOLENTINO's son, CASTILLO violated his obligation to his lessor to act with justice, give everyone his due, and observe honesty and good faith, an obligation that is deemed included in his leasehold agreement. Provisions of existing laws form part of and are read into every contract without need for the parties expressly making reference to them. 3. VIOLATION OF OBLIGATION OF A TENANT GROUND FOR DISPOSSESSION In sum, we hold that the construction of the reservoir constitutes a violation of Section 36 of R.A. No. 3844, an unauthorized use of the landholding for a purpose other than what had been agreed upon, and a violation of the leasehold contract between CASTILLO and TOLENTINO, for which the former is hereby penalized with permanent dispossession of his leasehold. SEAHcT


SOCIAL JUSTICE POLICY Citing Bautista v. Mag-isa, G.R. No. 152564, September 13, 2004, 438 SCRA 259; Gonzales v. Court of Appeals, G.R. No. 110335, June 18, 2001, 358 SCRA 598: Agrarian laws were enacted to help small farmers uplift their economic status by providing them with a modest standard of living sufficient to meet their needs for food, clothing, shelter and other basic necessities. It provides the answer to the urgent need to alleviate the lives of the vast number of poor farmers in our country. Yet, despite such laws, the majority of these farmers still live on a hand-to-mouth existence. This can be attributed to the fact that these agrarian laws have never really been effectively implemented. Certain individuals have continued to prey on the disadvantaged, and as a result, the farmers who are intended to be protected and uplifted by the said laws find themselves back in their previous plight or even in a more distressing situation. Citing De Jesus v. Intermediate Appellate Court, G.R. No. 72282, July 24, 1989, 175 SCRA 559: R.A. No. 3844, or the Agricultural Land Reform Code, was enacted by Congress to institute land reforms in the Philippines. It was passed to establish owner-cultivatorship and the family size farm as the basis of Philippine agriculture; to achieve a dignified existence for the small farmers free from pernicious industrial restraints and practices; as well as to make the small farmers more independent, self-reliant and responsible citizens and a source of genuine strength in our democratic society. R.A. 3844 and R.A. 6389, being social legislations, are designed to promote economic and social stability and must be interpreted liberally to give full force and effect to their clear intent, not only in favor of the tenant-farmers but also of landowners.


SOCIAL JUSTICE POLICY NOT INTENDED TO COUNTENANCE WRONGDOING We cannot allow a situation where despite the one-sided nature of the law governing agricultural leasehold tenancy (R.A. No. 3844), which exceedingly favors the agricultural lessee/tenant and farmworker the agricultural lessee has shown lack of courtesy to the landowner and, instead, abused his rights under said law, at the same time neglecting or willfully refusing to take advantage of his rights under the comprehensive agrarian reform law which would have otherwise fulfilled its mandate to provide land for the landless. The primary purpose, precisely, of agrarian reform is the redistribution of lands to farmers and regular farmworkers who are landless, irrespective of tenurial arrangement. The law recognizes and condones that a leasehold tenant may have his own land while he tills that of another, but certainly we cannot see any justification why a tenant should give away for free and sell his own agricultural land until nothing is left, and then insist himself on someone else's without giving the landowner the proper respect and regard that is due him, acting presumptuously and beyond his stature as mere agricultural lessee. Citing Cecilleville Realty and Service Corp. v. Court of Appeals, G.R. No. 120363, September 5, 1997, 278 SCRA 819:

The policy of social justice is not intended to countenance wrongdoing simply because it is committed by the underprivileged. Compassion for the poor is an imperative of every humane society but only when the recipient is not a rascal claiming an undeserved privilege. REYNALDO v. YATCO, G.R. No. 165494, March 20, 2009 DCN 3361 Belizario was the owner of a 4.3 hectare parcel of land which she donated to Tomas Yatco as evidence by a Deed of Donation inter vivos. Said land was tenanted by Aguido Levardo who subsequently executed a Pinanumpaang Salaysay signed by him and his children, waiving his rights as tenant. A. Levardo received 2M as disturbance compensation. T. Yatco sold the landholding to Gonzalo Puyat and Sons. The Levardos filed a complaint for the declaration of nullity of the Deed of Donation, Deed of Sale and the waiver of rights. DCN 3362 Leoncio Yatco was the owner of a 4.2 hectare parcel of land which was tenanted by Francisco and his son Hernando Levardo. F. Levardo likewise executed a similar Pinanumpaang Salaysay waiving his rights as tenant. F. Levardo received 2.4M as disturbance compensation. L. Yatco thereafter sold the landholding to Gonzalo Puyat and Sons. The Levardos filed a complaint for the declaration of nullity of the Deed of Donation, Deed of Sale and the waiver of rights. In both cases, the plaintiffs grounded their causes of action on the claim that the land in dispute was covered by Operation Land Transfer (OLT) pursuant to Presidential Decree No. 27 (P.D. No. 27). They contend that they were already deemed the owners of the land on the basis of an alleged Certificate of Land Transfer (CLT) in the name of their father Aguido, which was never issued by the DAR, but on the basis of an alleged certified xerox copy of a Masterlist of tenants wherein his name appeared. 1. PD 27 COVERAGE P.D. No. 27 should be read in conjunction with Letter of Instruction No. 474 (LOI No. 474) and the DAR Memorandum on the "Interim Guidelines on Retention by Small Landowners" dated July 10, 1975 (DAR Memorandum). The pertinent portion of LOI No. 474 is as follows: 1. You shall undertake to place the Land Transfer Program of the government pursuant to Presidential Decree No. 27, all tenanted rice/corn lands with areas of seven hectares or less belonging to landowners who own other agricultural lands of more than seven hectares in aggregate areas or lands used for residential, commercial, industrial or other urban purposes from which they derive adequate income to support themselves and their families. (Emphasis and underscoring supplied) The pertinent portion of the DAR Memorandum is as follows: xxx xxx xxx

5. Tenanted rice and/or corn lands seven (7) hectares or less shall not be covered by Operation Land Transfer. The relation of the land owner and tenant-farmers in these areas shall be leasehold . . . (Emphasis supplied)

Based on the foregoing, it is clear that the lands in dispute do not fall under the coverage of P.D. No. 27. The DAR Memorandum is categorical that lands with seven hectares or less shall not be covered by OLT. 2. TERMINATION OF LEASEHOLD BY PAYMENT OF DISTURBANCE COMPENSATION Based on the evidence on record, respondents paid Aguido P2,000,000.00 and Hernando P2,417,142.00 as disturbance compensation. A reading of the Pinanumpaang Salaysay executed by petitioners show that they gave up their leasehold rights"dahil sa aming kagustuhang umiba ng hanap buhay ng higit ang pagkikitaan kaysa panakahan." The money given by respondents as disturbance compensation was indeed advantageous to the families of petitioners, as it would have allowed them to pursue other sources of livelihood. 3. CERTIFICATE OF LAND TRANSFER EFFECT Citing Pagtalunan v. Tamayo, G.R. No. 54281, March 19, 1990, 183 SCRA 252: Moreover, assuming arguendo that CLTs were actually issued to petitioners, a CLT does not vest in the farmer/grantee ownership of the land described therein. At most, the CLT merely evidences the government's recognition of the grantee as partly qualified to await the statutory mechanism for the acquisition of ownership of the land titled by him as provided in P.D. No. 27. Neither is this recognition permanent or irrevocable.