AGRARIAN REFORM 1935 Constitution- The promotion of social justice to ensure the well-

I. History and Legal Basis being and economic security of all people should be the concern of the
PRE-SPANISH PERIOD State
Before the Spaniards came the Filipinos lived in villages or barangays Commonwealth Act No. 178 (An Amendment to Rice Tenancy
ruled by chiefs or datus. ActNo.4045) -Certain controls in the landlord-tenant relationships
Everyone had access to the fruits of the soil. Commonwealth Act. No.461, 1937 Specified reasons for the dismissal
of tenants and only with the approval of the Tenancy Division of the
SPANISH PERIOD Department of Justice.
Rural Program Administration, created March 2,1939- purchase and
When the Spaniards came the concept of encomienda (Royal Land lease of haciendas and their sale and lease to the tenants.
Grants) was introduced.
- haciendas (wealthy chinese families)
JAPANESE OCCUPATION
1st PHILIPPINE REPUBLIC peasants and workers organizations grew strength.
First Philippine Republic was established in 1899, Gen. Emilio Aguinaldo peasants took up arms
declared in the Malolos Constitution his intention to confiscate large Anti- Japanese group, the HUKBALAHAP (Hukbo ng Bayan Laban sa
estates. Hapon)

Aguinaldos plan was never implemented. PHILIPPINE REPUBLIC

After Philippine Independence in 1964 , problems of land tenure
AMERICAN PERIOD remained .
Philippine Bill of 1902 Set the ceilings: 16 has for private individuals President Manuel Roxas (1946-1948):
and 1,024 has for corporations. Republic Act No. 34 -- 70-30 sharing arrangements and regulating
Land Registration Act of 1902 (Act No. 496) registration of land titles share-tenancy contracts.
under the Torrens system. Republic Act No.55 more effective safeguard against arbitrary
Public Land Act of 1903 introduced the homestead system. ejectment of tenants.
Tenancy Act of 1933 (Act No. 4054 and 4113) regulated relationships
between landowners and tenants of rice (50-50 sharing) and sugar cane PHILIPPINE REPUBLIC
lands. President Elpidio Quirino (1948-1953)
Executive Order No. 355 issued on October 23,1950 -- Replaced the
COMMONWEALTH PERIOD National Land Settlement Administration with Land Settlement Development
President Manuel L. Quezon espoused the Social Justice program. Corporation (LASEDECO)

President Ramon Magsaysay(1953-1957)

Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS Page 1

 Republic Act No. 1160 of 1954 -- Abolished the LASEDECO and
established the National Resettlement and Rehabilitation Administration
(NARRA)
Republic Act No. 1199 (Agricultural Tenancy Act of 1954)
-relationship between landowners and tenant farmers by organizing share-
tenancy and leasehold system.
-tenant has option to elect either share tenancy or leasehold
-it also created the Court of Agrarian Relations.
Cont. President Ramon Magsaysay(1953-1957).
Republic Act No. 1400 (Land Reform Act of 1955) Created the Land
Tenure Administration(LTA)
President Carlos P. Garcia (1957-1961)
Continued the program of President Ramon Magsaysay.
President Diosdado Macapagal(1961-1965):
Republic Act No. 3844 of August 8,1963 Abolished shared tenancy,
institutionalized leasehold.
President Ferdinand Marcos(1965-1986):
Republic Act No.6389, (Code of Agrarian Reform) and RA No. 6390 of 1971
Created the Department of Agrarian Reform and the Agrarian Reform
Special Account Fund.
- Provides automatic conversion of share tenancy to leasehold.
Cont. President Marcos (1965-1986):..
Presidential Decree No. 2, September 26,1972 Declared the country
under land reform program.
Presidential Decree No.27,October 21,1972 Restricted land reform
scope to tenanted rice and corn lands and set the retention limit at 7
hectares.
President Corazon C. Aquino (1986-1992)
Section 21 under Article II The State shall promote comprehensive
rural development and agrarian reform.
signed into law Republic Act No. 6657
became effective on June 15,1988
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
President Fidel V. Ramos (1992-1998):
His administration committed to the vision Fairer, faster and more
meaningful implementation of the Agrarian Reform Program.
Republic Act No.7881,1995 Amended certain provisions of RA 6657
and exempted fishponds and prawns from the coverage of CARP.
Republic Act 8532,1998 (Agrarian Reform Fund Bill) additionalPhp50
billion for CARP and extended its implementation for another 10 years.
President Joseph E. Estrada(1998-2000)ERAP PARA SA MAHIRAP
launched the Magkabalikat Para sa Kaunlarang Agraryo or MAGKASAKA.
President Gloria Macapagal-Arroyo (2000-present):
Land Tenure Improvement/Provision of Support Services
Infrastructure Project/ KALAHI ARZone
Agrarian Justice
CARPER
Importance of Land Reform and its Constitutionality*
Assoc. of Small Landowners vs. Hon. Secretary, 175 SCRA 343
"Land for the Landless" is a slogan that underscores the acute imbalance in the
distribution of this precious resource among our people. But it is more than a
slogan. Through the brooding centuries, it has become a battle-cry dramatizing
the increasingly urgent demand of the dispossessed among us for a plot of earth
as their place in the sun.
Recognizing this need, the Constitution in 1935 mandated the policy of social
justice to "insure the well-being and economic security of all the people,
especially the less privileged. In 1973, the new Constitution affirmed this goal
adding specifically that "the State shall regulate the acquisition, ownership, use,
enjoyment and disposition of private property and equitably diffuse property
ownership and profits." Significantly, there was also the specific injunction to
Page 2
"formulate and implement an agrarian reform program aimed at emancipating
the tenant from the bondage of the soil."
The Constitution of 1987 was not to be outdone. Besides echoing these
sentiments, it also adopted one whole and separate Article XIII on Social Justice
and Human Rights, containing grandiose but undoubtedly sincere provisions for
the uplift of the common people. These include a call in the following words for
the adoption by the State of an agrarian reform program:
SEC. 4. The State shall, by law, undertake an agrarian reform program
founded on the right of farmers and regular farmworkers, who are landless,
to own directly or collectively the lands they till or, in the case of other
farmworkers, to receive a just share of the fruits thereof. To this end, the
State shall encourage and undertake the just distribution of all agricultural
lands, subject to such priorities and reasonable retention limits as the
Congress may prescribe, taking into account ecological, developmental, or
equity considerations and subject to the payment of just compensation. In
determining retention limits, the State shall respect the right of small
landowners. The State shall further provide incentives for voluntary land-
sharing.
Earlier, in fact, R.A. No. 3844, otherwise known as the Agricultural Land Reform
Code, had already been enacted by the Congress of the Philippines on August 8,
1963, in line with the above-stated principles. This was substantially superseded
almost a decade later by P.D. No. 27, which was promulgated on October 21,
1972, along with martial law, to provide for the compulsory acquisition of private
lands for distribution among tenant-farmers and to specify maximum retention
limits for landowners.
On July 17, 1987, President Corazon C. Aquino issued E.O. No. 228, declaring full
land ownership in favor of the beneficiaries of P.D. No. 27 and providing for the
valuation of still unvalued lands covered by the decree as well as the manner of
their payment. This was followed on July 22, 1987 by Presidential Proclamation
No. 131, instituting a comprehensive agrarian reform program (CARP), and E.O.
No. 229, providing the mechanics for its implementation.
Subsequently, the revived Congress of the Philippines took over legislative
power from the President and started its own deliberations, including extensive
public hearings, on the improvement of the interests of farmers. The result, after
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
almost a year of spirited debate, was the enactment of R.A. No. 6657, otherwise
known as the Comprehensive Agrarian Reform Law of 1988, which President
Aquino signed on June 10, 1988. This law, while considerably changing the
earlier mentioned enactments, nevertheless gives them supplementary effect
insofar as they are not inconsistent with its provisions.
The promulgation of P.D. No. 27 by President Marcos in the exercise of his
powers under martial law has already been sustained in Gonzales v. Estrella. As
for the power of President Aquino to promulgate Proc. No. 131 and E.O. Nos. 228
and 229, the same was authorized under Section 6 of the Transitory Provisions
of the 1987 Constitution.
ARTICLE II
DECLARATION OF PRINCIPLES AND STATE POLICIES
Section 9. The State shall promote a just and dynamic social order that will
ensure the prosperity and independence of the nation and free the people from
poverty through policies that provide adequate social services, promote full
employment, a rising standard of living, and an improved quality of life for all.
Section 10. The State shall promote social justice in all phases of national
development.
Section 21. The State shall promote comprehensive rural development and
agrarian reform.
ARTICLE XII
NATIONAL ECONOMY AND PATRIMONY
Section 1. The goals of the national economy are a more equitable distribution of
opportunities, income, and wealth; a sustained increase in the amount of goods
and services produced by the nation for the benefit of the people; and an
expanding productivity as the key to raising the quality of life for all, especially
the under-privileged.
Page 3
The State shall promote industrialization and full employment based on sound
agricultural development and agrarian reform, through industries that make full
and efficient use of human and natural resources, and which are competitive in
both domestic and foreign markets. However, the State shall protect Filipino
enterprises against unfair foreign competition and trade practices.
In the pursuit of these goals, all sectors of the economy and all regions of the
country shall be given optimum opportunity to develop. Private enterprises,
including corporations, cooperatives, and similar collective organizations, shall
be encouraged to broaden the base of their ownership.
Section 3. Lands of the public domain are classified into agricultural, forest or
timber, mineral lands and national parks. Agricultural lands of the public domain
may be further classified by law according to the uses to which they may be
devoted. Alienable lands of the public domain shall be limited to agricultural
lands. Private corporations or associations may not hold such alienable lands of
the public domain except by lease, for a period not exceeding twenty-five years,
renewable for not more than twenty-five years, and not to exceed one thousand
hectares in area. Citizens of the Philippines may lease not more than five
hundred hectares, or acquire not more than twelve hectares thereof, by
purchase, homestead, or grant.
Taking into account the requirements of conservation, ecology, and
development, and subject to the requirements of agrarian reform, the Congress
shall determine, by law, the size of lands of the public domain which may be
acquired, developed, held, or leased and the conditions therefor.
ARTICLE XIII
SOCIAL JUSTICE AND HUMAN RIGHTS
Section 1. The Congress shall give highest priority to the enactment of measures
that protect and enhance the right of all the people to human dignity, reduce
social, economic, and political inequalities, and remove cultural inequities by
equitably diffusing wealth and political power for the common good.
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
To this end, the State shall regulate the acquisition, ownership, use, and
disposition of property and its increments.
Section 2. The promotion of social justice shall include the commitment to create
economic opportunities based on freedom of initiative and self-reliance.
AGRARIAN AND NATURAL RESOURCES REFORM
Section 4. The State shall, by law, undertake an agrarian reform program
founded on the right of farmers and regular farmworkers who are landless, to
own directly or collectively the lands they till or, in the case of other
farmworkers, to receive a just share of the fruits thereof. To this end, the State
shall encourage and undertake the just distribution of all agricultural lands,
subject to such priorities and reasonable retention limits as the Congress may
prescribe, taking into account ecological, developmental, or equity
considerations, and subject to the payment of just compensation. In determining
retention limits, the State shall respect the right of small landowners. The State
shall further provide incentives for voluntary land-sharing.
Section 5. The State shall recognize the right of farmers, farmworkers, and
landowners, as well as cooperatives, and other independent farmers'
organizations to participate in the planning, organization, and management of
the program, and shall provide support to agriculture through appropriate
technology and research, and adequate financial, production, marketing, and
other support services.
Section 6. The State shall apply the principles of agrarian reform or stewardship,
whenever applicable in accordance with law, in the disposition or utilization of
other natural resources, including lands of the public domain under lease or
concession suitable to agriculture, subject to prior rights, homestead rights of
small settlers, and the rights of indigenous communities to their ancestral lands.
The State may resettle landless farmers and farmworkers in its own agricultural
estates which shall be distributed to them in the manner provided by law.
Page 4
Section 7. The State shall protect the rights of subsistence fishermen, especially
of local communities, to the preferential use of the communal marine and fishing
resources, both inland and offshore. It shall provide support to such fishermen
through appropriate technology and research, adequate financial, production,
and marketing assistance, and other services. The State shall also protect,
develop, and conserve such resources. The protection shall extend to offshore
fishing grounds of subsistence fishermen against foreign intrusion. Fishworkers
shall receive a just share from their labor in the utilization of marine and fishing
resources.
Section 8. The State shall provide incentives to landowners to invest the
proceeds of the agrarian reform program to promote industrialization,
employment creation, and privatization of public sector enterprises. Financial
instruments used as payment for their lands shall be honored as equity in
enterprises of their choice.
ARTICLE XVIII
TRANSITORY PROVISIONS
Section 22. At the earliest possible time, the Government shall expropriate idle
or abandoned agricultural lands as may be defined by law, for distribution to the
beneficiaries of the agrarian reform program.
MEANING OF SOCIAL LEGISLATION
Laws that seek to promote the common good, generally by protecting and
assisting the weaker members of society.
Meaning of social justice
Social Justice is neither communism nor despotism, nor atomism, nor
anarchy, but the humanization of the laws and the equalization of social and
economic forces by the state so that justice in its National and objectively
secular conception may at least be approximated. Social justice means the
promotion of the welfare of all the people, the adoption by government of
measures calculated to insure economic stability of all the component
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
elements of society, through the maintenance of proper economic and
social equilibrium in the interrelations of the members of the community,
constitutionally, through the adoption of measures legally justifiable, and
extra-constitutionally, through the exercise of powers underlying the
existence of all government on time-honored principle of salus populi est
suprema lex.
The constitutional provisions on agrarian reform
(5) Specific provision on agrarian and natural resources reform. Article XIII:
Sec. 4. The State shall, by law, undertake an agrarian reform program
founded on the right of farmers and regular farmworkers, who are landless, to
own directly or collectively the lands they till or, in the case of other
farmworkers, to receive a just share of the fruits thereof. To this end, the State
shall encourage and undertake the just distribution of all agricultural lands,
subject to such priorities and reasonable retention limits as the Congress may
prescribe, taking into account ecological, developmental, or equity
considerations, and subject to the payment of just compensation. In determining
retention limits, the State shall respect the right of small landowners. The State
shall further provide incentives for voluntary land-sharing.
Sec. 5. The State shall recognize the right of farmers, farmworkers, and
landowners, as well as cooperatives, and other independent farmers
organizations to participate in the planning organization, and management of
the program, and shall provide support to agriculture through appropriate
technology and research, and adequate financial, production, marketing, and
other support services.
Sec. 6. The State shall apply the principles of agrarian reform or stewardship,
whenever applicable in accordance with law, in the disposition or utilization of
other natural resources, including lands of the public domain under lease or
concession suitable to agriculture, subject to prior rights, homestead rights of
small settlers, and the rights of indigenous communities to their ancestral lands.
The State may resettle landless farmers and farmworkers in its own
agricultural estates which shall be distributed to them in the manner provided by
law.
Page 5
Sec. 7. The State shall protect the rights of subsistence fishermen, Proposed Settlements
especially of local communities; to the preferential use of the communal marine
and fishing resources, both inland and offshore. It shall provide support to such COMPOSITION OF THE CODE
fishermen through appropriate technology and research, adequate financial,
production, and marketing assistance, and other services. The State shall also An agricultural leasehold system to replace all existing share tenancy
protect, develop, and conserve such resources. The protection shall extend to systems in agriculture.
offshore fishing grounds of subsistence fishermen against foreign intrusion.
Why leasehold?
Fishworkers shall receive a just share from their labor in the utilization of marine
and fishing resources.
- Protects tenurial and economic status
Sec. 8. The State shall provide incentives to landowners to invest the proceeds
of the agrarian reform program to promote industrialization, employment - Guarantees physical possession, enjoyment and management
creation, and privatization of public sector enterprises. Financial instruments
used as payment for their lands shall be honored as equity in enterprises of their - Assures continuity of relations
choice.
- In case lessor sells or alienates the legal possession, transferee shall be
subrogated to the rights and substituted to the obligations of lessor
RA 3844
Agricultural leasehold?
BENEFICIARIES
A juridical tie between lessor and lessee
Tenant Farmers

Agricultural wage-earners or farm workers

- Abolished shared tenancy. Now leasehold tenancy.
Settlers including migrant workers
- Why is it that leasehold relationship was preferred?
Owner-cultivators of less than family-size farms
a. Tenurial Security under Agrarian Land Reform relationship can
exist even if there is death of the lessee or lessor, sale , transfer or
conveyance of agricultural land.
LANDS COVERED BY THE CODE
- The transferee of the agriland, the vendee is bound by the leasehold
Tenanted Areas relationship

Landed Estates - Should it be annotated? No. Not necessary. The law provides for that.

Old Settlements

Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS Page 6

 - Leasehold relationship will remain. To protect the lessee from possible - Agricultural lessee vs Civil lessee
ejectment or disposition of property.
To distinguish lessee under Civil Code and under Agrarian Law
- Refers to 2 parties
1. Grounds to eject - AL 3844 while CL Civil Code
- It is referred as agricultural lessor and agricultural lessee
2. Where will you file the ejectment case agri lessee DAR while civil
- Lease somebody must pay rental lessee in regular courts

- Can the lessor eject the tenant? - Lessee has substantial rights, you dont have to allege , you have to
support.
Yes, the lessor has the grounds provided by 3844 to eject the tenant.
Unless the ground for ejectment is not enumerated in 3844, the lessee - Allegation only is not sufficient
cannot be ejected.

Extinguishment of relation vs dispossession

Grounds to dispossess a lessee: TOP-FNS
a. Extinguishment no court approval, voluntary act (abandonment of
a. Failure to comply with terms and conditions of agreement land without knowledge of lessor or voluntary surrender by lessee)
or an act of God
b. Planting of crops or the use of land for other purpose than that
agreed upon b. Dispossession with court order, premise of lessee

c. Failure to adopt proven farm practices to conserve land

d. Fault or negligence resulting in substantial damage Can relation be terminated by death?

e. Non-payment of rental when due No, continue between lessor and members of lessees immediate farm
household to be chosen by lessor within 1 month from death: 1.
f. Employed a sublessee surviving spouse; 2. eldest direct descendant by consanguinity; 3. next
eldest descendants in the order of their age.
- Normally the grounds are last two grounds, under 3844, there is an
express provision that the lessee will allow a sublessee. Liabilities of lessor if he ejects tenant without authorization?

- If they are agricultural workers under RA 3844, they are under Bill Of -Fine or imprisonment
Rights, they are entitled to minimum wage law, among others.
-Damages suffered

Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS Page 7

-Attorneys fees
DIFFERENCE:
-Remuneration for last income
Difference between PD 27 (Tenants Emancipation Decree) and RA 6657
(Comprehensive Agrarian Reform Law)

Lease rental PD 27 RA 6657

Purpose Abolish leasehold in Main purpose is to
Shall not be more than the equivalent of 25% of the average normal tenanted lands. It made provide land for the
harvest during the 3 agricultural years immediately preceding the date the tiller of the land the landless through
of leasehold after deducting amount used for the seeds and costs of amortizing owner of the acquiring and
harvesting, threshing, loading, hauling and processing. land he tills. distribution of lands and
providing support
facilities and system for
the benefit of the
farmers.
TENANTS EMANCIPATION DECREE Land Covered Private lands which are Covers all public and
(Pres. Decree no.27.) devoted to rice and corn private agricultural lands
ONLY. including other lands of
BENEFICIARIES public domain suitable
for agriculture regardless
Beneficiaries of the Decree are the bona fide tenant farmers of of tenurial arrangement
private agricultural lands primarily devoted to rice and corn under a system and commodity
of share-crop or lease tenancy (not farm labor), whether classified as landed produced.
Effect in Implementing With the passage of RA Main governing law of
estate or not.
Land Reform Program 6657, it is only a Agrarian Land Reform
suppletory law. This here in the Philippines.
means, it will be
applicable only to those
The tenant farmer- whether in land classified as landed estate (i.e., with an matters not covered by
area of 24 hectares or above) or not, shall be deemed owner (subject to certain RA 6657.
requirements and conditions) of a portion constituting a family size of five (5)
hectares, if not irrigated and three (3)hectares, if irrigated. Lands transferred to
tenant-farmers under the Decree will revert to the government and not to the
landowners in case where the tenant abandons his tillage or refuses to take
PD 27 rice & corn land
advantage of his rights under the laws.
RA 6657 all other agricultural land (including lands of public domain).
Note that the Decree does not apply to lands owned by the government or
government-owned corporation. Sigre vs. CA, G.R. No. 109568, August 8, 2002

Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS Page 8

 The Court need not belabor the fact that R.A. 6657 or the CARP Law
operates distinctly from P.D. 27. R.A. 6657 covers all public and private
agricultural land including other lands of the public domain suitable for
agriculture as provided for in Proclamation No. 131 and Executive
Order No. 229;36 while, P.D. 27 covers rice and corn lands. On this score,
E.O. 229, which provides for the mechanism of the Comprehensive Agrarian
Reform Program, specifically states: "Presidential Decree No. 27, as amended,
shall continue to operate with respect to rice and corn lands, covered
thereunder. x x x" It cannot be gainsaid, therefore, that R.A. 6657 did not repeal
or supersede, in any way, P.D. 27. And whatever provisions of P.D. 27 that are
not inconsistent with R.A. 6657 shall be suppletory to the latter, and all rights
acquired by the tenant-farmer under P.D. 27 are retained even with the passage
of R.A. 6657.
Sigre v. CA : PD 27 is suppletory and operates separately from RA 6657.
Can lands acquired under PD 27 be transferred by DAR to another qualified
beneficiary?
Estolas vs. Mabalot, G.R. No. 133706, May 7, 2002
Facts:
A Certificate of Land Transfer (hereinafter referred to as CLT) was issued
in favor of respondent over a 5,000 square meter lot (hereinafter referred to as
subject land). Needing money for medical treatment, respondent passed on the
subject land to the petitioner. According to respondent, there was only a verbal
mortgage; while according to petitioner, a sale had taken place.
Respondent filed a Complaint against the petitioner before the Barangay
Lupon in Pangasinan for the purpose of redeeming the subject land. When no
amicable settlement was reached, the case was referred to the DAR regional office
. DARs District Office found that respondent merely gave the subject land to
petitioner as guarantee for the payment of a loan he had incurred from the latter;
and recommending that the CLT remain in the name of respondent and that the
money loan be returned to petitioner.
Petitioner insisted that the subject land had been sold to him by
respondent and requested the DAR to cancel the CLT in respondents name.
Another investigation was conducted on the matter which led to the issuance of an
Order issued by DAR Regional Director. In the said Order, the DAR found the act
of respondent in surrendering the subject land in favor of petitioner as constituting
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
abandonment thereof, and denied respondents prayer for redemption of the
subject land. Respondents request for reinvestigation was denied in a Resolution.
Thus, respondent appealed the case to the DAR Central Office which an
order was issued reversing the assailed Order of DAR Regional Director and
ordering the petitioner to return the subject land to respondent. Petitioners Motion
for Reconsideration was denied.
Issues:
A. Whether or not there is a valid abandonment made by Respondent Mabalot.
B. Whether the act of Respondent Mabalot in conveying to petitioner the right to possess
and cultivate the disputed parcel of land constitutes a valid abandonment thereby rendering
the property available for transfer to other bonafide farmers.
C. Whether the issuance of an emancipation patent and thereafter a transfer certificate of
title in the name of petitioner has validated and legitimized possession and ownership over
the disputed property."
Held:
Main Issue:
Abandonment
The subject property was awarded to respondent by virtue of PD 27. A CLT was issued in
his favor. PD 27 specifically provides that when private agricultural land -- whether classified
as landed estate or not is primarily devoted to rice and corn under a system of sharecrop
or lease tenancy, the tenant farmers thereof shall be deemed owners of a portion
constituting a family-size farm of five (5) hectares if not irrigated, and three (3) hectares if
irrigated.
Petitioner avers that respondent neither protested when the former had the subject land
surveyed and planted with 40 mango trees, nor attempted to return the money he had
borrowed from petitioner in 1976. Because the lot has been abandoned by respondent, the
beneficiary, and because PD 27 does not prohibit the transfer of properties acquired under
it, petitioner theorizes that the Department of Agrarian Reform (DAR) may award the land to
another qualified farmer-grantee.
Non-transferability of Land Awarded Under PD 27
We do not agree. PD 27 specifically provides that title to land acquired pursuant to its
mandate or to that of the Land Reform Program of the government shall not be transferable
Page 9
except to the grantees heirs by hereditary succession, or back to the government by other
legal means. The law is clear and leaves no room for interpretation.
Upon the promulgation of PD 27, their emancipation gave them the rights to possess,
cultivate and enjoy the landholding for themselves. These rights were granted by the
government to them as the tillers and to no other. Thus, to insure their continuous
possession and enjoyment of the property, they could not, under the law, effect any transfer
except back to the government or, by hereditary succession, to their successors.11
Furthermore, this Court has always ruled that agrarian laws must be interpreted liberally in
favor of the grantees in order to give full force and effect to the clear intent of such laws: "to
achieve a dignified existence for the small farmers"; and to make them "more independent,
self-reliant and responsible citizens, and a source of genuine strength in our democratic
society."12
Neither are we convinced that an award under PD 27 may be transferred to another in case
the grantee abandons it. The law is explicit.
No Abandonment
For abandonment to exist, the following requisites must be proven: (a) a clear and absolute
intention to renounce a right or claim or to desert a right or property and (b) an external act
by which that intention is expressed or carried into effect. There must be an actual, not
merely a projected, relinquishment; otherwise, the right or claim is not vacated or waived
and, thus, susceptible of being appropriated by another. In the present case, no such "willful
failure" has been demonstrated. Quite the contrary, respondent has continued to claim
dominion over the land.
No Valid Reallocation
Furthermore, even if respondent did indeed abandon his right to possess and cultivate the
subject land, any transfer of the property may only be made in favor of the government. In
Corpuz v. Grospe,19 the Court held that there was a valid transfer of the land after the
farmer-grantee had signed his concurrence to the Samahang Nayon Resolution
surrendering his possession of the landholding. This voluntary surrender to the Samahang
Nayon constituted a surrender or transfer to the government itself.
In the present case, there was no valid transfer in favor of the government. It was petitioner
himself who requested the DAR to cancel respondents CLT and to issue another one in his
favor.21 Unlike in the above-cited case, respondents land was not turned over to the
government or to any entity authorized by the government to reallocate the farmholdings of
tenant-farmers who refuse to become beneficiaries of PD 27. Petitioner cannot, by himself,
take over a farmer-beneficiarys landholding, allegedly on the ground that it was abandoned.
The proper procedure for reallocation must be followed to ensure that there was indeed
abandonment, and that the subsequent beneficiary is a qualified farmer-tenant as provided
by law.
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
WHEREFORE, the Petition is hereby DENIED
Estolas v. Mabalot : Land may only be transferred either by succession or to
government.
DAR cannot transfer directly to a qualified beneficiary.
Land Bank of the Phil. vs. Heirs of Eleuterio Cruz, G.R. No. 175175,
September 29, 2008
Facts:
Case is regarding the valuation to the land of the respondents of which the area
was placed by the government under the coverage of the operation land transfer
program under PD 27.
The LBP, petitioners herein, valued the land in accordance with the guidelines
set forth under PD 27 and EO No. 228 and pegged the value of the land
amounting to P106,935.76 per hectare. Respondents rejected petitioners
valuation and insist on claiming that the said land is worth between P150,00 to
P200,000 per hectare.
The Cagayan Provincial Agrarian Reform Adjudicator (PARAD) however valued
the land at P80,000 following the factors set under RA 6557 (CARL) and of which
such value, as just compensation to the respondent, was approve by the lower
court (RTC) setting as Special Agrarian Court (SAC).
Issue:
Whether or not PD 27 or RA 6557 is the applicable law in determining the value
of the land which was taken under PD 27 or before RA 6557 was enacted.
Held:
The Court laid down in Paris v. Alfeche the applicability of P.D. No. 27 and E.O.
No. 228 in relation to R.A. No. 6657 in the matter of the payment of just
compensation. There the Court explained that while under P.D. No. 27 tenant
farmers are already deemed owners of the land they till, they are still required
to pay the cost of the land before the title is transferred to them and that
pending the payment of just compensation, actual title to the tenanted land
remains with the landowner.
In Paris, the application of the process of agrarian reform was still incomplete
thus, the Court held therein that with the passage of R.A. No. 6657 before
its completion, the process should now be completed under R.A. No.
6657, with P.D. No. 27 and E.O. No. 228 applying only suppletorily.
It would certainly be inequitable to determine just compensation based on the
guideline provided by PD No. 27 and EO 228 considering the DARs failure to
determine the just compensation for a considerable length of time. That just
Page 10
compensation should be determined in accordance with RA 6657, and not PD 27
or EO 228, is especially imperative considering that just compensation should be
the full and fair equivalent of the property taken from its owner by the
expropriator, the equivalent being real, substantial, full and ample.
The land therefore should be valued under RA 6657 following the guidelines set
in DAR AO no. 5, series of 1998 and not under PD 27.
Land Bank v. Heirs of Cruz:
-The determination of just compensation should be based on RA 6657
for lands covered under PD 27. PD 27 applies only suppletorily.
CHAPTER 1
Is industrialization a component of Agrarian Reform?Yes.
Sec.2 (RA 6657)
sound rural development and
industrialization
to promote industrialization
Industrial inputs necessary to agriculture
(fertilizers, insecticides, hybrid seeds, irrigation systems,
tractors)
Can private corporation acquire ownership of alienable lands of public
domain?
Chavez v. PEA: No, only through lease not exceeding 25 yrs. Renewable not
more than 25yrs. And not to exceed 1,000 hectares
(CONST., Art. XII, Sec.3)
Sec. 3 (b) Agriculture or Agricultural Activity
- Means the cultivation of the soil, planting of crops, growing of fruit trees,
raising of livestock, poultry or fish including the harvesting of such farm
products, and other farm activities and practices performed by a farmer in
conjunction with such farming operations done by person whether natural or
juridical.
Luz Farms v. Sec. Sec.3 (b) unconstitutional
(raising of livestock, poultry and swine per SC)
- use of land is incidental and not the principal factor
RA 7881 (effective May 1995)
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
- amended Sec.3(b) and removed the raising of livestock, poultry or fish
raising of livestock, swine and poultry is different from crop or tree
farming.
Industrial, not agricultural activity.
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
appurtenances
DAR Admin. Order No. 01, S. 2004 (RULES & REGULATIONS
GOVERNING THE EXCLUSION OF AGRICULTURAL LANDS USED FOR
CATTLE RAISING FROM THE COVERAGE OF CARP)
Objective: To prevent circumvention of CARP and to protect the rights
of ARBs due to unauthorized change/conversion or fraudulent
declaration of areas used for cattle purposes.
Coverage: All applications for exclusion from CARP of private
agricultural lands actually, exclusively and directly used for cattle raising
as of 15 June 1988.
Types of animal: cattle (of bovine family), bull, calf, cow.
Policies:
(1) Those ADE used for cattle raising as of 15 June 1988 shall be
excluded (exclusion to be granted only upon proof and continuously
utilized up to time of application);
(2) Any change in use shall be subject to policies on land conversion
(3) Only the grazing/pasture area and for infrastructure necessary for
cattle raising shall be excluded; all other areas shall be covered.
(4) Encourage growth of cattle industry
(5) If filing of exclusion is in response to notice of CARP coverage, DAR
shall deny due course if application is filed 60 days after date of receipt
of notice.
(6) Only exclusion applications fully supported by documents shall be
accepted
DAR v. Sutton: Masbate land -cattle-breeding capital of Phil
(VOS - due to Luz Farms - withdraw VOS)
Page 11
 - Constitutionality of AO No. 9, S. 1993 (prescribing a maximum retention
limit for owners of lands devoted to livestock raising);
- SC nullified AO; RA 7881 changed definition of agricultural
activity by dropping from its coverage lands that are devoted
to commercial livestock, poultry and swine-raising. 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.
Admin. Order No. 07, S. 2008
Policy guidelines:
Lands ADE used for livestock purposes as of 15 June 1988 and
continuously used shall be excluded; conversely, those not ADE are
subject to CARP if one or more of the following conditions apply: (1)
there is agricultural activity in the area (i.e., cultivation of soil, planting
of crops, growing of trees including harvesting); (2) land is suitable for
agriculture and occupied and tilled by farmers.
In line with principle of regularity in the performance of official
functions, all processes by DAR per AO No. 9 are valid.
Sec. 3 (c) Agricultural land land devoted to agricultural activity & not
classified as mineral, forest, residential, commercial or industrial land.
Republic vs Slavador Lopez Agri-business
Facts
Subject of this petition are four (4) parcels of land with an aggregate area of
160.1161 hectares registered in the name of Salvador N. Lopez Agri-Business
Corporation.
On August 2, 1991, Municipal Agrarian Reform Officer (MARO) Socorro C. Salga
issued a Notice of Coverage to petitioner with regards (sic) to the
aforementioned landholdings which were subsequently placed under
Compulsory Acquisition pursuant to R.A. 6657 (Comprehensive Agrarian Reform
Law).
On December 10, 1992, petitioner filed with the Provincial Agrarian Reform
Office (PARO), Davao Oriental, an Application for Exemption of the lots covered
by TCT No. T-12637 and T-12639 from CARP coverage. It alleged that pursuant
to the case of Luz Farms v. DAR Secretary said parcels of land are exempted
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
from coverage as the said parcels of land with a total area of 110.5455 hectares
are used for grazing and habitat of petitioner's 105 heads of cattle, 5 carabaos,
11 horses, 9 heads of goats and 18 heads of swine, prior to the effectivity of the
Comprehensive Agrarian Reform Law (CARL).
On December 13, 1992 and March 1, 1993, the MARO conducted an onsite
investigation on the two parcels of land confirming the presence of the livestock
as enumerated.
On June 24, 1993, TCT No. T-12635 covering Lots 1454-A & 1296 was cancelled
and a new one issued in the name of the Republic of the Philippines under RP T-
16356. On February 7, 1994, petitioner through its President, Salvador N. Lopez,
Jr., executed a letter-affidavit addressed to the respondent-Secretary requesting
for the exclusion from CARP coverage of Lots 1454-A and 1296 on the ground
that they needed the additional area for its livestock business. On March 28,
1995, petitioner filed before the DAR Regional Director of Davao City an
application for the exemption from CARP coverage of Lots 1454-A and 1296
stating that it has been operating grazing lands even prior to June 15, 1988 and
that the said two (2) lots form an integral part of its grazing land.
The DAR Regional Director, after inspecting the properties, issued an Order
dated March 5, 1997 denying the application for exemption of Lots 1454-A and
1296 on the ground that it was not clearly shown that the same were actually,
directly and exclusively used for livestock raising since in its application,
petitioner itself admitted that it needs the lots for additional grazing area. The
application for exemption, however of the other two (2) parcels of land was
approved.
Issue:
Whether or not the lands are covered under CARL
Held:
In contrast, the Limot lands were found to be agricultural lands devoted to
coconut trees and rubber and are thus not subject to exemption from CARP
coverage.
In the Report dated 06 April 1994, the team that conducted the inspection found
that the entire Limot lands were devoted to coconuts (41.5706 hectares) and
rubber (8.000 hectares) and recommended the denial of the application for
exemption. 30 Verily, the Limot lands were actually, directly and exclusively
Page 12
used for agricultural activities, a fact that necessarily makes them subject to the
CARP. These findings of the inspection team were given credence by the DAR
Regional Director who denied the application, and were even subsequently
affirmed by the DAR Secretary and the Court of Appeals.
In the 07 February 1994 Letter-Affidavit addressed to the DAR Secretary,
SNLABC requested the exemption of the Limot lands on the ground that the
corporation needed the additional area for its livestock business. As pointed out
by the DAR Regional Director, this Letter-Affidavit is a clear indication that the
Limot lands were not directly, actually and exclusively used for livestock raising.
SNLABC casually dismisses the clear import of their Letter-Affidavit as a "poor
choice of words." Unfortunately, the semantics of the declarations of SNLABC in
its application for exemption are corroborated by the other attendant factual
circumstances and indicate its treatment of the subject properties as non-
livestock.
Verily, the MARO itself, in the Investigation Report cited by no less than SNLABC,
found that the livestock were only moved to the Limot lands sporadically and
were not permanently designated there. The DAR Secretary even described
SNLABC's use of the area as a "seasonal extension of the applicant's 'grazing
lands' during the summer." Therefore, the Limot lands cannot be claimed to
have been actually, directly and exclusively used for SNLABC's livestock
business, especially since these were only intermittently and secondarily used as
grazing areas. The said lands are more suitable and are in fact actually,
directly and exclusively being used for agricultural purposes.
Tax declaration classified as agricultural land (one way to prove)- it is
not conclusive.
Milestone Farms, Inc. vs. Office of the President
Facts:
Petitioner Milestone Farms, Inc. (petitioner) was incorporated with the Securities
and Exchange Commission on January 8, 1960. 4 Among its pertinent secondary
purposes are: (1) to engage in the raising of cattle, pigs, and other livestock; to
acquire lands by purchase or lease, which may be needed for this purpose; and
to sell and otherwise dispose of said cattle, pigs, and other livestock and their
produce when advisable and beneficial to the corporation; (2) to breed, raise,
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
and sell poultry; to purchase or acquire and sell, or otherwise dispose of the
supplies, stocks, equipment, accessories, appurtenances, products, and by-
products of said business; and (3) to import cattle, pigs, and other livestock, and
animal food necessary for the raising of said cattle, pigs, and other livestock as
may be authorized by law. 5
On June 10, 1988, a new agrarian reform law, Republic Act (R.A.) No. 6657,
otherwise known as the Comprehensive Agrarian Reform Law (CARL), took
effect, which included the raising of livestock, poultry, and swine in its coverage.
However, on December 4, 1990, this Court, sitting en banc, ruled in Luz Farms v.
Secretary of the Department of Agrarian Reform 6 that agricultural lands
devoted to livestock, poultry, and/or swine raising are excluded from the
Comprehensive Agrarian Reform Program (CARP).
Thus, in May 1993, petitioner applied for the exemption/exclusion of its
316.0422-hectare property, covered by Transfer Certificate of Title Nos. (T-
410434) M-15750, (T-486101) M-7307, (T-486102) M-7308, (T-274129) M-15751,
(T-486103) M-7309, (T-486104) M-7310, (T-332694) M-15755, (T-486105) M-
7311, (T-486106) M-7312, M-8791, (T-486107) M-7313, (T-486108) M-7314, M-
8796, (T-486109) M-7315, (T-486110) M-9508, and M-6013, and located in
Pinugay, Baras, Rizal, from the coverage of the CARL, pursuant to the
aforementioned ruling of this Court in Luz Farms.
Meanwhile, on December 27, 1993, the Department of Agrarian Reform (DAR)
issued Administrative Order No. 9, Series of 1993 (DAR A.O. No. 9), setting forth
rules and regulations to govern the exclusion of agricultural lands used for
livestock, poultry, and swine raising from CARP coverage. Thus, on January 10,
1994, petitioner re-documented its application pursuant to DAR A.O. No. 9. 7
Acting on the said application, the DAR's Land Use Conversion and Exemption
Committee (LUCEC) of Region IV conducted an ocular inspection on petitioner's
property and arrived at the following findings:
[T]he actual land utilization for livestock, swine and poultry is 258.8422
hectares; the area which served as infrastructure is 42.0000 hectares; ten (10)
hectares are planted to corn and the remaining five (5) hectares are devoted to
fish culture; that the livestock population are 371 heads of cow, 20 heads of
horses, 5,678 heads of swine and 788 heads of cocks; that the area being
applied for exclusion is far below the required or ideal area which is 563
hectares for the total livestock population; that the approximate area not
Page 13
directly used for livestock purposes with an area of 15 hectares, more or less, is
likewise far below the allowable 10% variance; and, though not directly used for
livestock purposes, the ten (10) hectares planted to sweet corn and the five (5)
hectares devoted to fishpond could be considered supportive to livestock
production.
On January 21, 1997, then DAR Secretary Ernesto D. Garilao (Secretary Garilao)
issued an Order exempting from CARP only 240.9776 hectares of the 316.0422
hectares previously exempted by Director Dalugdug, and declaring 75.0646
hectares of the property to be covered by CARP. 14
Secretary Garilao opined that, for private agricultural lands to be excluded from
CARP, they must already be devoted to livestock, poultry, and swine raising as of
June 15, 1988, when the CARL took effect. He found that the Certificates of
Ownership of Large Cattle submitted by petitioner showed that only 86 heads of
cattle were registered in the name of petitioner's president, Misael Vera, Jr., prior
to June 15, 1988; 133 were subsequently bought in 1990, while 204 were
registered from 1992 to 1995. Secretary Garilao gave more weight to the
certificates rather than to the headcount because "the same explicitly provide
for the number of cattle owned by petitioner as of June 15, 1988.
Issue:
Whether or not the lands are covered under CARL
Held:
With the procedural issue disposed of, we find that petitioner's arguments fail to
persuade. Its invocation of Sutton is unavailing. In Sutton, we held:
In the case at bar, we find that 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,
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
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 appurtenances. TaDSHC
Clearly, 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.
Petitioner's admission that, since 2001, it leased another ranch for its own
livestock is fatal to its cause. 64 While petitioner advances a defense that it
leased this ranch because the occupants of the subject property harmed its
cattle, like the CA, we find it surprising that not even a single police and/or
barangay report was filed by petitioner to amplify its indignation over these
alleged illegal acts. Moreover, we accord respect to the CA's keen observation
that the assailed MARO reports and the Investigating Team's Report do not
actually contradict one another, finding that the 43 cows, while owned by
petitioner, were actually pastured outside the subject property.
Adjacent property is not covered.
Agricultural Land (Section 3 c)
Natalia Realty v. DAR 1979
Presidential Proclamation No. 1637 set aside 20,312 hectares of land located in
the Municipalities of Antipolo, San Mateo and Montalban as townsite areas to
absorb the population overspill in the metropolis which were designated as the
Lungsod Silangan Townsite. The NATALIA properties are situated within the
areas proclaimed as townsite reservation. NATALIA properties later became the
Antipolo Hills Subdivision. Notice of Coverage on the undeveloped portions of the
Antipolo Hills Subdivision which consisted of roughly 90.3307 hectares. NATALIA
immediately registered its objection to the Notice of Coverage
SC:
They ceased to be agricultural lands upon approval of the reservation. Lands
previously converted by government agencies, other than DAR, to non-
agricultural uses prior to the effectivity of the CARL were outside the coverage of
Page 14
that law. Ruling not confined solely to agricultural lands located within townsite
reservations, but applied also to real estate converted to non-agricultural uses
prior to the effectivity of the CARL.
NOTE:
DOJ Opinion No. 44, Series of 1990 and the case of Natalia Realty, Inc
opine that with respect to the conversion of agricultural land covered by R.A. No.
6657 to non-agricultural uses, the authority of the DAR to approve such
conversion may be exercised from the date of its effectivity, on June 15, 1988.
Thus, all lands that are already classified as commercial, industrial or residential
before June 15, 1988 no longer need any conversion clearance.
However, the reclassification of lands to non-agricultural uses shall not
operate to divest tenant-farmers of their rights over lands covered by PD 27,
which have been vested prior to June 15, 1988.
In order to implement the intent and purpose of the provisions of the
aforecited laws, the DAR has issued guidelines through AO No. 4, Series of 2003.
(Please refer to the attached files together with this reviewer The important
provisions there are only the DISTURBANCE COMPENSATION, APPROVING
AUTHORITIES, EFFECT ON PRE-EXISTING CARP COVERAGE and PROTESTS).
DAR AO No. 4 (Rules on exemption) - all lands already classified as
commercial, industrial or residential before June 15,1988 no longer need
conversion clearance
Requirements: Sworn application, copy of title, certification from
HLURB (zoning or classification, citing zoning ordinance), among others.
Public notice. Disturbance compensation.
Roxas & Co., Inc. vs. CA, G.R. No. 127876, December 17, 1999
Facts:
This case involves three (3) haciendas in Nasugbu, Batangas owned by
petitioner Roxas & Co., Inc and the validity of the acquisition of these haciendas
by the government under RA No. 6657.
Petitioner is a domestic corporation and is the registered owner with TCTs and
Tax Declarations of three haciendas, namely, Haciendas Palico, Banilad and
Caylaway, all located in Nasugbu, Batangas.
Issue:
Whether or not the petitioners landholdings are subject to coverage under the
CARL, in view of the undisputed fact that petitioners landholdings have been
converted to non-agricultural uses by Presidential Proclamation No. 1520 which
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
declared the Municipality of Nasugbu as a tourist zone, and the zoning ordinance
of the said Municipality re-classifying certain portions of the petitioners
landholdings as non-agricultural or at the very least entitle the petitioner to
apply for conversion as conceded by respondent DAR.
Held:
Respondent DARs failure to observe due process in the acquisition of
petitioners landholdings does not ipso facto give this Court the power to
adjudicate over petitioners application for conversion of its haciendas from
agricultural to non-agricultural. The agency charged for conversion is the DAR.
The petition is granted in part and the acquisition proceedings over the three
haciendas are nullified for respondent DARs failure to observe due process
therein. In and the applicable administrative procedure, the case is hereby
remanded to the respondent DAR for proper acquisition proceedings and
determination of petitioners application for conversion.
Notice of coverage was wrongfully sent
SC: . DAR's failure to observe due process in the acquisition of
petitioners' landholdings does not ipso facto give the Supreme Court the
power to adjudicate over petitioner's application for conversion of its
haciendas from agricultural to non-agricultural. The power to determine
whether Hacienda Palico, Banilad and Caylaway are non-agricultural
which exempts from the coverage of the CARL lies with the DAR, not
with the Supreme Court. Case was remanded to DAR for proper
acquisition proceedings and determination of petitioner's application for
conversion
NHA vs. Allarde, G.R. No. 106593, November 16, 1999
Facts:
Lots 836 and 839, registered in the of the Republic of the Philippines, and
covered by the TCT No. 34624 and No. 34627, respectively, were acquired by
the Republic on April 2, 1938 from Philippine Trust Company. They form part of
the Tala Estate in Bagong Silang, Kalookan City, which, on April 26, 1971, was
reserved by Proclamation No. 843 for, among others, the housing programs of
the National housing Authority.
According to private respondent Rufino Mateo, he had lived in the disputed lots
since his birth in 1928. In 1959, he started farming and working on six-hectare
portion of said lots, after the death of his father who had cultivated a 13 hectare
portion of the same lots.
Page 15
In 1989, Mateo filed with the DAR the petition for the award to them of subject
disputed lots under CARP.
On March 18, 1992, the respondent spouses Mateo, relying on their claim that
the subject lots are agricultural land within the coverage of the CARP, brought
before the respondent RTC a complaint for damages with a prayer for a writ of
preliminary injunction, to enjoin the NHA from bulldozing further and making
constructions on the lots under controversy.
RTC Judge Allarde issued the injunction against NHA.
Held:
As early as April 26, 1971, the Tala Estate (included the disputed lots) was
resrved, inter alia, under Presidential Proclamation No. 843, for the housing
program of the NHA, the same has been categorized as not being devoted to the
agricultural activity
SC: As early as April 26, 1971, the Tala Estate (including the disputed
lots) was reserved under Presidential Proclamation No. 843, for the
housing program of the National Housing Authority, the same has been
categorized as not being devoted to the agricultural activity
contemplated by Section 3 (c) of R.A. No. 6657, and is, therefore,
outside the coverage of the CARL. Verily, the assailed Orders of the
respondent Court declaring the lots under controversy as "agricultural
land" and restraining the petitioner from involving the same in its
housing project thereon, are evidently bereft of any sustainable basis
Advincula-Velasquez vs. CA,et al., G.R. No. 111387, June 8,2004
The petitioners were the agricultural lessees of a Riceland located in Paraaque
Metro Manila.
In 1978, Sps. Nery and the Lorenzo sold the property to the Delta Motors
Corporation (DMC). Petitioner Velasquez, in his capacity as leaseholder
agricultural tenant, filed an action for the redemption of the said property before
the Court of Agrarian Relation. The CAR dismiss the petition for lack on the part
of the petitioner to redeem the property in its acquisition price in the amount of
2,319,210 pesos but directing the defendant to maintain the petitioner as
agricultural lessee to the land in question.
Petitioner Velasquez and the defendants appealed the decision of the CAR to the
Intermediate Appellate Court who affirmed the decision of the CAR. Petitioner
Velasquez filed a petition for review to the Supreme Court who issued a
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
temporary restraining order enjoining the CARs decision pending the out come
of the petition.
In 1981, the land in question was reclassified as residential zone under the
ordinance issued by the city of Manila. Later, the land in question was mortgage
by the DMC to the PNB as a security for its obligation who later foreclose it
because of the failure of the DMC to pay its account. The PNB in 1986 executed
a deed of sale of the said land in favor of the Remman Enterprise Inc. who
decided to develop it in to a residential subdivision.
Meanwhile, the Supreme Court issue a decision on the petition for review filed by
the petitioner Velasquez affirming the decision of the IAC stating that the case
had become moot and academic with regards the claim of the petitioner against
the DMC considering that the property had been foreclose by the PNB declaring
however that the petitioner may redeem the property from the PNB and its
transferee. The record was remanded to the PARAD or the Provincial Agrarian
Adjudication for the petitioner to exercise there right of redemption but since the
case had become moot and academic, the PARAD denied the action of the
petitioner to recover the property against the DMC since the land in question is
now a residential land. The right of the petitioner as an agricultural lessee was
terminated and the property was now in the possession of the Remman
Enterprise, Inc. The petitioner filed a motion before the DARAB or the
Department of Agrarian Adjudication Board who reverses the decision of the
PARAD stating that the land in question is an agricultural land and uphold the
right of the petitioner as an agricultural lessee to recover the said land .The
Remman Enterprise filed an appeal before the CA who reverses the decision of
the DARAB because the land in question was already reclassified as residential
land as early as 1981 converting it from agricultural land in to non-agricultural
land. The petitioner filed a motion to the Supreme Court.
Issue:
Whether or not the land was an agricultural land or a residential land.
Held:
According to the Supreme Court, agricultural land was defined under RA. 6657
as those land devoted to agricultural activities and not classified as forest,
minerals, residential and industrial land.
The records show that as early as 1981, the landholding was reclassified as a
low density zone under Metro Manila Zoning Ordinance No. 81-01, Series of 1981
before Rep. Act No. 6657 took effect on June 15, 1998. It has been considered as
early as that time for residential purposes thus not within the ambit of CAR.
Page 16
 SC: Since the property was already reclassified as residential by the
Metro Manila Commission and the HSRC before the effectivity of Rep. Act
No. 6657, there was no need for the private respondent to secure any
post facto approval thereof from the DAR
Jose Junio, et., al vs Garilao
Facts:
"In a Complaint dated February 12, 1994, filed with the [Department of Agrarian
Reform Adjudication Board (DARAB)] by complainants (some of whom are herein
petitioners), identified as 'Potential CARP Beneficiaries' per Certification of OIC
[Municipal Agrarian Reform Officer (MARO)] dated November 21, 1991 . . ., it is
prayed that a writ of preliminary injunction be issued against the registered
owners of a certain parcel of agricultural land consisting of 71 hectares, more or
less, known as Lot No. 835-B of Bacolod Cadastre, Brgy. Pahanocoy, Bacolod
City, covered by Transfer Certificate of Title No. T-79622. Petitioners claim
that . . . Sta. Lucia Realty Corporation and the Estate of Guillermo Villasor,
represented by Irving Villasor, are bulldozing and leveling the subject property
for the purpose of converting it into a residential subdivision; that as prospective
CARP beneficiaries of the land in question, 'being former laborers, actual
occupants and permanent residents of Barangay Pahanocoy,' their rights will be
prejudiced by the illegal conversion of the land into a residential subdivision . . . .
"On April 13, 1994, the DARAB OIC Executive Director forwarded the complaint
to [Provincial Agrarian Reform Adjudicator (PARAD)], DAR, Region VI, Bacolod
City for appropriate action . . . . Before any hearing could be conducted thereon,
the Secretary of the Department of Agrarian Reform issued an Order dated
September 13, 1994 in 'RE: PETITION FOR EXEMPTION FROM CARP COVERAGE
PURSUANT TO DOJ OPINION NO. 44, SERIES OF 1990, IRVING P. VILLASOR, et al.,
Rep. by Atty. Angel Lobaton, Jr., Petitioners,' portions of which read as follows:
'After a careful study of the facts of the case and the evidences presented by the
parties, this Office finds the petition for exemption to be well founded. Under
DOJ Opinion No. 44, Series of 1990, it provides that lands which has already
been classified as mineral, forest, residential, commercial and industrial areas,
prior to June 15, 1988 shall be excluded from CARP coverage. To this, it is an
[i]nescapable conclusion that the subject property is exempted from CARP
coverage considering the fact that the same was classified as residential as
evidenced by the Resolution No. 5153-A, Series of 1976 of the City Council of
Bacolod and as approved by the Human Settlements Regulatory Commission
(now HLURB) in its Resolution dated September 24, 1980 as per Certification
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
dated June 22, 1994 issued by the said Commission. The Certification of the
National Irrigation Administration (NIA) dated June 9, 1994 stated that the
subject land is not irrigable or is outside the service area of the irrigation system
in the locality. In effect the said application had conformed to the requirements
of the law on exemption. In accord thereto, the stand of Mr. Espanola that the
portion, which he planted to trees and developed into mini-forest should be
covered by CARP[,] is beyond recognition as the program does not apply to
those which are already classified as residential lands prior to the effectivity of
CARL on June 15, 1988. Instead, it is confined only to agricultural lands, which
under R.A. 6657, Sec. 3(c), it defines agricultural lands as lands devoted to
agricultural activity as defined in this Act and not classified as mineral, forest,
residential or industrial land. With the above stated definition, it is beyond
reason that the placing of the said portion under CARP coverage (1.5 hectare) is
devoid of legal and factual basis.'"
Issue:
Whether the respondent DAR secretary had the inherent authority or power to
exclude or exempt at will from the coverage of the Comprehensive Agrarian
Reform Program (CARP) the subject agricultural land which was already
automatically covered by the CARL (RA 6657) upon its effectivity on June 15,
1988 without affording due process to herein petitioners and without the
necessity of Congress having first to amend Section 4 of the said law authorizing
such exemption or exclusion from CARP coverage.
Held:
Section 3(c) of the CARL defines agricultural land as that which is "devoted to
agricultural activity . . . and not classified as mineral, forest, residential,
commercial or industrial land."
The meaning of agricultural lands covered by the CARL was explained further by
the DAR in its Administrative Order No. 1, Series of 1990, 12 entitled "Revised
Rules and Regulations Governing Conversion of Private Agricultural Land to Non-
Agricultural Uses," issued pursuant to Section 49 of CARL, which we quote:
". . . . Agricultural land refers to those devoted to agricultural activity as defined
in R.A. 6657 and not classified as mineral or forest by the Department of
Environment and Natural Resources (DENR) and its predecessor agencies, and
not classified in town plans and zoning ordinances as approved by the Housing
and Land Use Regulatory Board (HLURB) and its preceding competent
authorities prior to 15 June 1988 for residential, commercial or industrial use."
Page 17

Prior to this Order, Department of Justice Opinion No. 44 dated March 16, 1990,
which was addressed to then DAR Secretary Florencio Abad, recognized the fact
that before the date of the law's effectivity on June 15, 1988, the reclassification
or conversion of lands was not exclusively done by the DAR. 13 Rather, it was a
"coordinated effort" of all concerned agencies; namely, the Department of Local
Governments and Community Development, the Human Settlements
Commission and the DAR.
It is thus settled that with respect to areas classified and identified as zonal
areas not for agricultural uses, like those approved by the HSRC before the
effectivity of RA 6657 on June 15, 1988, the DAR's clearance is no longer
necessary for conversion.
DAR vs. Berenguer
Facts:
The respondents were the registered owners of several residential and industrial
lands with a total area of 58.0649 hectares located in Barangay Bibincahan,
Sorsogon.
In April 1998, the respondents received from the DAR notices of coverage of
their said landholdings by the Government's Comprehensive Agrarian Reform
Program (CARP) pursuant to Republic Act No. 6657 (Comprehensive Agrarian
Reform Law, or CARL). They protested the notices of coverage, filing on October
5, 1998, in the office of DAR Regional Director Percival Dalugdug (Regional
Director Dalugdug) in Legaspi City, their application for exclusion of their
landholdings from CARP coverage, and praying for the lifting of the notices of
coverage.
In October and November 1998, the DAR Secretary, without acting on the
respondents' application for exclusion, cancelled their titles and issued
certificates of land ownership awards (CLOAs), covering their landholdings, to
the members of the Baribag Agrarian Reform Beneficiaries Development
Cooperative (Baribag), not to the respondents' workers on the landholdings,
although Baribag was not impleaded in the respondents' application for
exclusion.
In support of their claim that their landholdings were already classified as
residential and industrial, the respondents submitted the following documents,
namely: 8
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
a.The certification dated May 18, 1999 issued by HLURB, stating, among others,
that the Town Plan/Zoning Ordinance of Sorsogon, Sorsogon (classifying
Barangay Bibincalan, * where the respondents' properties were located, as a
residential and commercial area), was approved by HLURB (then Human
Settlements Commission/Human Settlements Regulatory Commission);
b.An excerpt from the Comprehensive Development Plan of the Municipality of
Sorsogon, Sorsogon, showing that Barangay Bibincalan * was part of the Central
Business District; hence, the respondents' landholdings in Bibincalan * were
classified as residential and industrial;
c.Resolution No. 5 of the Sangguniang Bayan of Sorsogon, series of 1981,
expanding the area of the poblacion to include Barangay Bibincalan, * among
others;
d.The certification dated August 27, 1997 issued by the Office of the Zoning
Administrator, Office of the Mayor, Sorsogon, Sorsogon, signed by Deputized
Zoning Administrator Raul Jalmanzar, declaring that the respondents'
landholdings were situated in Barangay Bibincalan * within the Poblacion area of
the Municipality of Sorsogon; and
e.Department of Justice Opinion No. 44, series of 1990, stating that a parcel of
land was considered non-agricultural, and, therefore, beyond the coverage of
the CARP, if it had been classified as residential, commercial, or industrial in the
City or Municipality Land Use Plan or Zoning Ordinance approved by HLURB
before the effectivity of R.A. No. 6657 on June 15, 1988.
Issue:
Whether or not the land is covered under RA 6657
Held:
In ruling that the respondents' landholdings were not devoted to cattle raising,
the DAR relied on DAR Administrative Order (DAO) No. 9, series of 1993, which
required that properties should be considered excluded from the coverage of the
CARL only if it was established that as of June 15, 1988, the date of effectivity of
the law, there existed the minimum ratio of one head of cattle to one hectare of
land, and one head of cattle to 1.7815 hectares of infrastructure.
Page 18
According to the DAR, only 15 heads of cattle were found within the 58 hectares
sought to be excluded based on the semestral survey conducted in Sorsogon by
the Bureau of Agricultural Statistics in the period from 1988 to 1992, which was
in contravention of DAO No. 9, series of 1993.
The CA found, however, that heads of cattle were really being raised in the
landholdings of the respondents. This finding was not disputed by the DAR. In
view of the finding of the CA, we cannot now hold differently, for we are bound
by the finding of fact of the CA. Verily, the insufficiency of the number of heads
of cattle found during the semestral survey did not automatically mean that the
landholdings were not devoted to the raising of livestock. We concur with the CA
that there could be several reasons to explain why the number of cattle was
below the ratio prescribed under DAO No. 9 at the time of the survey, including
pestilence, cattle rustling, or sale of the cattle.
Resolution No. 5, passed on March 12, 1981 by the Sangguniang Bayan of
Sorsogon, Sorsogon, showed that the limits of the poblacion area of the
municipality included Barangay Bibincahan, where the respondents'
landholdings were situated.
There is no dispute that as early as 1981, the respondents' landholdings have
been part of the poblacion of Sorsogon, Sorsogon. Consistent with Hilario and
Natalia, holding that the respondents' landholdings were non-agricultural, and,
consequently, outside the coverage of the CARL, was fully warranted. In fact, the
excerpt from the Comprehensive Development Plan of Sorsogon, Sorsogon
showed that Barangay Bibincahan was within the Central Business District of the
municipality.
Alangilan v. Office of President
SC: It is beyond cavil that the Alangilan landholding was classified as
agricultural, reserved for residential in 1982, and was reclassified as
residential-1 in 1994. However, contrary to petitioner's assertion, the
term reserved for residential does not change the nature of the land
from agricultural to non-agricultural. As aptly explained by the DAR
Secretary, the term reserved for residential simply reflects the intended
land use. It does not denote that the property has already been
reclassified as residential, because the phrase reserved for residential is
not a land classification category. Indubitably, at the time of the
effectivity of the CARL in 1988, the subject landholding was still
agricultural. This was bolstered by the fact that the Sangguniang
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
Panlalawigan had to pass an Ordinance in 1994, reclassifying the
landholding as residential-1. If, indeed, the landholding had already been
earmarked for residential use in 1982, as petitioner claims, then there
would have been no necessity for the passage of the 1994 Ordinance.
Heirs of Deleste vs Leviste
Facts:
The spouses Gregorio Nanaman (Gregorio) and Hilaria Tabuclin (Hilaria) were
the owners of a parcel of agricultural land located in Tambo, Iligan City,
consisting of 34.7 hectares (subject property). Said spouses were childless, but
Gregorio had a son named Virgilio Nanaman (Virgilio) by another woman. Virgilio
had been raised by the couple since he was two years old. Gregorio also had two
daughters, Esperanza and Caridad, by still another woman. 3
When Gregorio died in 1945, Hilaria and Virgilio administered the subject
property. 4 On February 16, 1954, Hilaria and Virgilio sold the subject property
to Dr. Jose Deleste (Deleste) for PhP16,000. 5 The deed of sale was notarized on
February 17, 1954 and registered on March 2, 1954. Also, the tax declaration in
the name of Virgilio was canceled and a new tax declaration was issued in the
name of Deleste. The arrears in the payment of taxes from 1952 had been
updated by Deleste and from then on, he paid the taxes on the property. 6
On May 15, 1954, Hilaria died. 7 Gregorio's brother, Juan Nanaman, was
appointed as special administrator of the estate of the deceased spouses.
Subsequently, Edilberto Noel (Noel) was appointed as the regular administrator
of the joint estate. 8
On April 30, 1963, Noel, as the administrator of the intestate estate of the
deceased spouses, filed before the Court of First Instance, Branch II, Lanao del
Norte an action against Deleste for the reversion of title over the subject
property, docketed as Civil Case No. 698. 9 Said case went up to this Court in
Noel v. CA, where We rendered a Decision 10 on January 11, 1995, affirming the
ruling of the CA that the subject property was the conjugal property of the late
spouses Gregorio and Hilaria and that the latter could only sell her one-half (1/2)
Page 19
share of the subject property to Deleste. As a result, Deleste, who died in 1992,
and the intestate estate of Gregorio were held to be the co-owners of the subject
property, each with a one-half (1/2) interest in it. 11
Notably, while Civil Case No. 698 was still pending before the CFI, particularly on
October 21, 1972, Presidential Decree No. (PD) 27 was issued. This law
mandates that tenanted rice and corn lands be brought under the Operation
Land Transfer (OLT) Program and awarded to farmer-beneficiaries. Thus, the
subject property was placed under the said program. 12 However, only the heirs
of Gregorio were identified by the Department of Agrarian Reform (DAR) as the
landowners. Concomitantly, the notices and processes relative to the coverage
were sent to these heirs. 13
In 1975, the City of Iligan passed City Ordinance No. 1313, known as the "Zoning
Regulation of Iligan City," reclassifying the subject property as
commercial/residential. 14
Eventually, on February 12, 1984, DAR issued Certificates of Land Transfer
(CLTs) in favor of private respondents who were tenants and actual cultivators of
the subject property. 15 The CLTs were registered on July 15, 1986.
In 1991, the subject property was surveyed. 17 The survey of a portion of the
land consisting of 20.2611 hectares, designated as Lot No. 1407, was approved
on January 8, 1999. 18 The claim folder for Lot No. 1407 was submitted to the
LBP which issued a Memorandum of Valuation and a Certificate of Cash Deposit
on May 21, 2001 and September 12, 2001, respectively. Thereafter,
Emancipation Patents (EPs) and Original Certificates of Title (OCTs) were issued
on August 1, 2001 and October 1, 2001, respectively, in favor of private
respondents over their respective portions of Lot No. 1407.
On February 28, 2002, the heirs of Deleste, petitioners herein, filed with the
Department of Agrarian Reform Adjudication Board (DARAB) a petition seeking
to nullify private respondents' EPs. 21 This was docketed as Reg. Case No. X-
471-LN-2002.
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
On July 21, 2003, the Provincial Agrarian Reform Adjudicator (PARAD) rendered a
Decision 22 declaring that the EPs were null and void in view of the pending
issues of ownership, the subsequent reclassification of the subject property into
a residential/commercial land, and the violation of petitioners' constitutional
right to due process of law.
Subsequently, the DARAB, in DARAB Case No. 12486, reversed the ruling of the
PARAD in its Decision 25 dated March 15, 2004. It held, among others, that the
EPs were valid as it was the heirs of Deleste who should have informed the DAR
of the pendency of Civil Case No. 698 at the time the subject property was
placed under the coverage of the OLT Program considering that DAR was not a
party to the said case. Further, it stated that the record is bereft of any evidence
that the city ordinance has been approved by the Housing and Land Use
Regulatory Board (HLURB), as mandated by DAR Administrative Order No. 01,
Series of 1990, and held that whether the subject property is indeed exempt
from the OLT Program is an administrative determination, the jurisdiction of
which lies exclusively with the DAR Secretary or the latter's authorized
representative. Petitioners' motion for reconsideration was likewise denied by
the DARAB in its Resolution 26 dated July 8, 2004.
Issue:
Whether the land is covered under agrarian reform
Held:
We agree with petitioners that the subject property, particularly Lot No. 1407, is
outside the coverage of the agrarian reform program in view of the enactment
by the City of Iligan of its local zoning ordinance, City Ordinance No. 1313.
aSAHCE
It is undeniable that the local government has the power to reclassify
agricultural into non-agricultural lands. In Pasong Bayabas Farmers Association,
Inc. v. CA, 45 this Court held that pursuant to Sec. 3 of Republic Act No. (RA)
2264, amending the Local Government Code, municipal and/or city councils are
Page 20
empowered to "adopt zoning and subdivision ordinances or regulations in
consultation with the National Planning Commission." It was also emphasized
therein that "[t]he power of the local government to convert or reclassify lands
[from agricultural to non-agricultural lands prior to the passage of RA 6657] is
not subject to the approval of the [DAR]."
Likewise, it is not controverted that City Ordinance No. 1313, which was enacted
by the City of Iligan in 1975, reclassified the subject property into a
commercial/residential area.
However, the reclassification of lands to non-agricultural uses shall not operate
to divest tenant[-]farmers of their rights over lands covered by Presidential
Decree (PD) No. 27, which have been vested prior to 15 June 1988.
Rom vs Roxas & co.
Facts:
On September 30, 1997, respondent sought the exemption of 27 parcels of land
located in Barangay Aga, Nasugbu, Batangas, having an aggregate area of
21.1236 hectares and constituting portions of the land covered by Transfer
Certificate of Title .
Respondent asserted that Comprehensive Agrarian Reform Law (CARL) covers
only agricultural land 5 which is defined under Section 3 (c) thereof as "land
devoted to agricultural activity . . . and not classified as mineral, forest,
residential, commercial or industrial land." Respondent claimed that prior to the
effectivity of the CARL on June 15, 1988, the lands subject of its application were
already re-classified as part of the Residential Cluster Area specified in Zone A
VII of the Nasugbu Municipal Zoning Ordinance No. 4, Series of 1982, which
zoning ordinance was approved by the Human Settlement Regulatory
Commission (HSRC [now the Housing and Land Use Regulatory Board (HLURB)])
under HSRC Resolution No. 123, Series of 1983. Respondent cited DOJ Opinion
No. 44 (1990) which provides that lands already classified by a valid zoning
ordinance for commercial, industrial or residential use, which ordinance was
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
approved prior to the effectivity of the CARL, no longer need conversion
clearance from the DAR.
In its Order 11 of November 6, 2002, the DAR granted the application in this
wise:
WHEREFORE, premises considered, the Application for Exemption Clearance
from CARP coverage filed by Roxas & Company, Inc., involving twenty-seven
(27) parcels of land, specifically described in pages 1 and 2 of this Order,[12]
being portions of TCT No. T-44664, with an aggregate area of 21.1236 hectares
located [in] Barangay Aga, Nasugbu, Batangas is hereby GRANTED, subject to
the following conditions:
1.The farmer-occupants within subject parcels of land shall be maintained in
their peaceful possession and cultivation of their respective areas of tillage until
a final determination has been made on the amount of disturbance
compensation due and entitlement of such farmer-occupants thereto by the
PARAD of Batangas.
2.No development shall be undertaken within the subject parcels of land until
the appropriate disturbance compensation has been paid to the farmer-
occupants who are determined by the PARAD to be entitled thereto. Proof of
payment of disturbance compensation shall be submitted to this Office within
ten (10) days from such payment; and
3.The cancellation of the CLOA issued to the farmer beneficiaries shall be subject
of a separate proceeding before the PARAD of Batangas.
ISSUE:
Whether the land is covered under CARL.
Held:
Having established through said documents that the 27 parcels of land are
within the coverage of the said (Nasugbu) Municipal Zoning Ordinance No. 4, the
DAR declared as well that respondent substantially complied with the
Page 21
requirements of DAR AO No. 6, series of 1994 in DAR ADM Case No. A-9999-014-
98. The DAR thus granted the application in an Order of the same date and of
exactly the same tenor.
he Court recognized the power of a local government unit to classify and convert
land from agricultural to non-agricultural prior to the effectivity of the CARL and
thus upheld the validity of said zoning ordinance.
LBP vs Estate fof Araneta
Facts:
On June 21, 1974, then President Marcos issued Proclamation 1283, carving out
a wide expanse from the Watershed Reservation in Antipolo, Rizal and reserving
the segregated area for townsite purposes, "subject to private rights, if any
there be."
Then came the amendatory issuance, Proclamation 1637 dated April 18, 1977,
thereby increasing the size of the reservation, designated as "Lungsod Silangan
Townsite" (LS Townsite), by 20.312 hectares and revising its technical
description so as to include, within its coverage, other lands in the municipalities
of San Mateo and Montalban, Rizal to absorb "the population overspill in Greater
Manila Area," but again "subject to private rights, if any there be,"
Earlier, or on March 15, 1983, J. Amado Araneta, now deceased, acquired
ownership of the subject Doronilla property by virtue of court litigation. A little
over a week later, he had OCT No. 7924 canceled and secured the issuance of
Transfer Certificate of Title (TCT) No. N-70860 in his name.
On July 22, 1987, then President Corazon C. Aquino issued Proclamation No. 131
instituting the Comprehensive Agrarian Reform Program (CARP). Thereafter,
then DAR Undersecretary Jose C. Medina, in a memorandum of March 10, 1988,
ordered the Regional Director of DAR Region IV to proceed with the OLT
coverage and final survey of the Doronilla property. 12 Republic Act No. (RA)
6657, otherwise known as the Comprehensive Agrarian Reform Law (CARL) 13 of
1988, was then enacted, and took effect on June 15, 1988
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
On December 12, 1989, DAR issued a "Notice of Acquisition" addressed to
Doronilla, covering 7.53 hectares of the land now covered by TCT No. 216746
and offering compensation at a valuation stated in the notice. 15 Alarmed by the
turn of events whereby DAR was having its property, or a portion of it, surveyed,
incidental to effecting compulsory land acquisition, the Araneta Estate
addressed a letter 16 to DAR dated June 27, 1990, formally protesting the series
of land surveys being conducted by the Bureau of Lands on what is now its
property. It claimed that the CARL does not cover the said property, being part
of the LS Townsite reservation, apart from being mountainous, with a slope of
more than 70 degrees and containing commercial quantities of marble deposit.
The Araneta Estate followed its protest letter with two (2) more letters dated
June 20, 1990 and May 28, 1991, in which it reiterated its request for conversion,
citing, for the purpose, Department of Justice (DOJ) Opinion No. 181, Series of
1990.
Issue:
Whether or not CA erred in gave retroactive effect or application to Proclamation
Nos. 1283 & 1637 resulting in the negation of "full land ownership to qualified
farmer-beneficiaries covered by P.D. No. 27
Held:
Several basic premises should be made clear at the outset. Immediately prior to
the promulgation of PD 27 in October 1972, the 1,645-hectare Doronilla
property, or a large portion of it, was indisputably agricultural, some parts
devoted to rice and/or corn production tilled by Doronilla's tenants. Doronilla, in
fact, provided concerned government agencies with a list of seventy-nine (79)
30 names he considered bona fide "planters" of his land. These planters, who
may reasonably be considered tenant-farmers, had purposely, so it seems,
organized themselves into Samahang Nayon(s) so that the DAR could start
processing their applications under the PD 27 OLT program. CLTs were
eventually generated covering 73 hectares, with about 75 CLTs actually
distributed to the tenant-beneficiaries. However, upon the issuance of
Proclamation 1637, "all activities related to the OLT were stopped."
Page 22
To restate a basic postulate, the provisions of RA 6657 apply only to agricultural
lands under which category the Doronilla property, during the period material,
no longer falls, having been effectively classified as residential by force of
Proclamation 1637. It ceased, following Natalia Realty, Inc., to be agricultural
land upon approval of its inclusion in the LS Townsite Reservation pursuant to
the said reclassifying presidential issuance. In this regard, the Court cites with
approval the following excerpts from the appealed CA decision:
The above [Natalia Realty, Inc.] ruling was reiterated in National Housing
Authority vs. Allarde where the Supreme Court held that lands reserved for,
converted to, non-agricultural uses by government agencies other than the
[DAR], prior to the effectivity of [RA] 6657 . . . are not considered and treated as
agricultural lands and therefore, outside the ambit of said law. The High Court
declared that since the Tala Estate as early as April 26, 1971 was reserved, inter
alia, under Presidential Proclamation No. 843, for the housing program of the
[NHA], the same has been categorized as not being devoted to agricultural
activity contemplated by Section 3(c) of R.A. No. 6657, and therefore outside the
coverage of CARL.
GONZALO PUYAT & SONS, INC.vs RUBEN ALCAIDE
Facts:
Petitioner Gonzalo Puyat and Sons, Inc. is the registered owner of 14 parcels of
land.
n April 14, 1998, the Municipal Agrarian Reform Officer (MARO) issued a Notice
of Coverage over the subject landholding informing petitioner that the subject
properties were being considered for distribution under the government's
agrarian reform program. 4 Thereafter, on November 15, 1998, the
corresponding Notice of Valuation and Acquisition 5 was issued informing
petitioner that a 37.7353-hectare portion of its property is subject to immediate
acquisition and distribution to qualified agrarian reform beneficiaries and that
the government is offering P7,071,988.80 as compensation for the said property.
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
Petitioner then filed a Petition 6 before the Department of Agrarian Reform
(DAR), wherein it argued that the properties were bought from their previous
owners in good faith; that the same remains uncultivated, unoccupied, and
untenanted up to the present; and, that the subject landholdings were classified
as industrial, thus, exempt from the coverage of the Comprehensive Agrarian
Reform Program (CARP). Petitioner prayed, among other things, that the Notice
of Coverage and Notice of Acquisition be lifted and that the properties be
declared exempt from the coverage of CARP.
Respondents 8 on their part countered, among other things, that the
classification of the land as industrial did not exempt it from the coverage of the
CARP considering that it was made only in 1997; the HLURB 9 certification that
the Municipality of Bian, Laguna does not have any approved plan/zoning
ordinance to date; that they are not among those farmer-beneficiaries who
executed the waivers or voluntary surrender; and, that the subject landholdings
were planted with palay. 10
On June 8, 2001, then DAR Secretary Hernani A. Braganza, issued an Order 11 in
favor of the respondent declaring that the subject properties are agricultural
land.
Issue:
Whether or not the land is exempted.
Held:
As aptly found by the Office of the President, the importance of conducting an
ocular inspection cannot be understated, since it is one of the steps designed to
comply with the requirements of administrative due process. The Office of the
President stressed this in its Decision, to wit:
In other words, before the MARO sends a Notice of Coverage to the landowner
concerned, he must first conduct a preliminary ocular inspection to determine
whether or not the property may be covered under CARP. The foregoing
Page 23
undertaking is reiterated in the latest DAR AO No. 01, s. of 2003, entitled "2003 proceedings because of the DAR's failure to comply with administrative due
Rules Governing Issuance of Notice of Coverage and Acquisition of Agricultural process of sending Notice of Coverage and Notice of Acquisition of the
Lands Under RA 6657." Section 1 [1.1] thereof provides that: landowner concerned.

"1.1Commencement by the Municipal Agrarian Reform Officer (MARO) After Considering the claim of appellant that the subject land is not agricultural
determining that a landholding is coverable under the CARP, and upon because it is unoccupied and uncultivated, and no agricultural activity is being
accomplishment of the Pre-Ocular Inspection Report, the MARO shall prepare the undertaken thereon, there is a need for the DAR to ascertain whether or not the
NOC (CARP Form No. 5-1)." (NOC stands for Notice of Coverage) same may be placed under CARP coverage. 47** AcICHD

Found on the records of this case is a ready-made form Preliminary Ocular
Inspection Report (undated) signed by the concerned MARO. Interestingly,
however, the check box allotted for the all-important items "Land
Condition/Suitability to Agriculture" and "Land Use" was not filled up. There is no
separate report on the record detailing the result of the ocular inspection
conducted. These circumstances cast serious doubts on whether the MARO
actually conducted an on-site ocular inspection of the subject land. Without an
ocular inspection, there is no factual basis for the MARO to declare that the
subject land is devoted to or suitable for agricultural purposes, more so, issue
Notice of Coverage and Notice of Acquisition.
Thus, the question of whether or not petitioner's properties could be covered by
the CARP has not yet been resolved. Until such determination, it follows that
petitioner's landholdings cannot be the proper subject of acquisition and
eventual distribution to qualified farmer-beneficiaries. However, these involve
factual controversies, which are clearly beyond the ambit of this Court. Verily,
the review of factual matters is not the province of this Court. The Supreme
Court is not a trier of facts, and is not the proper forum for the ventilation and
substantiation of factual issues.

The importance of conducting an ocular inspection cannot be understated. In the AGRARIAN DISPUTE [Section 3(d)]
event that a piece of land sought to be placed from CARP coverage is later found any controversy relating to tenurial arrangements (leasehold, tenancy,
unsuitable for agricultural purposes, the landowner concerned is entitled to, and stewardship) over lands devoted to agriculture
any controversy relating to compensation of lands acquired under CARL
the DAR is duty bound to issue, a certificate of exemption pursuant to DAR
and other terms and conditions of transfer of ownership.
Memorandum Circular No. 34, s. of 1997, entitled "Issuance of Certificate of
tenancy relationship
Exemption for Lands Subject of Voluntary Offer to Sell (VOS) and Compulsory
Acquisition (CA) Found Unsuitable for Agricultural Purposes."
ESSENTIAL REQUISITIES: PSC-PPS
More importantly, the need to conduct ocular inspection to determine initially
whether or not the property may be covered under the CARP is one of the steps 1) Parties (landowner & tenants)
designed to comply with the requirements of administrative due process. The 2) Subject matter is agricultural land
CARP was not intended to take away property without due process of law 3) Consent of parties
4) Purpose is agricultural production
(Development Bank of the Philippines vs. Court of Appeals, 262 SCRA 245.
5) Personal cultivation by tenant
[1996]). The exercise of the power of eminent domain requires that due process 6) Sharing of harvest between parties
be observed in the taking of private property. In Roxas & Co., Inc. v. Court of
Appeals, 321 SCRA 106 [1999], the Supreme Court nullified the CARP acquisition All requisites must concur, absence of one does not make one a tenant.

Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS Page 24


Isidro v. CA
- Private resp is owner of land. Sister of priv resp allowed Isidro to occupy
swampy portion subject to condition to vacate upon demand. Failure to
vacate, unlawful detainer was filed against Isidro. RTC dismissed bec
land is agricultural and so agrarian.
SC:
Jurisdiction over subject matter determined from allegations of
complaint. Court does not lose jurisdiction by defense of tenancy
relationship and only after hearing that, if tenancy is shown, the court
should dismiss for lack of jurisdiction. Case involving agri land does not
automatically make such case agrarian. Six requisites were not present.
There was no contract to cultivate & petitioner failed to substantiate
claim that he was paying rent for use of land.
SUPLICO v. CA
Suplico is a lessee of rice land. Private respondent was allowed by
Suplico to till the land while Suplico will provide the farm implements
and thereafter Suplico was to receive cavans from the palay by way of
rental. Years later, Suplico threatened to eject priv. resp. from the
property, so private respondent filed an action for damages against
Suplico in CAR. Resp. Owner intervened in case and alleged the absence
of contractual relationship. Trial court declared private respondent as
agricultural lessee and confirmed by CA.
SC:
- SC found no reasons to disturb findings
1. Private respondent was in actual possession of land with family in a
farmhouse just like what a farm tenant normally would.
2. Private resp. and wife were personally plowing, planting, weeding and
harvesting.
3. Management was left entirely to private respondent
4. Private respondent shared the harvest with Suplico.
MONSANTO v. ZERNA: tenancy relationship may be established verbally or
writing
Sps. Zerna were charged with qualified theft for the taking of coconuts
owned by petitioner. They were acquitted but required Zerna to return
P1,100 to Monsanto on the ground that Monsanto did not consent to
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
harvest of coconut. Who is entitled to P1,100 proceeds of copra sale.
This falls under DARAB
There is Agrarian dispute:
1. Subject of dispute was taking of coconuts
2. Private respondents were overseers at the time of taking by virtue of
Agreement .
tenancy relationship may be established verbally or writing, expressly
or impliedly
- here there was agreement which contradicts petitioners contention
that private respondents are mere overseers. Being overseers does not
foreclose their being tenants. Petitioner allowed respondent to plant
coconut, etc. Harvests: receipts of remittance by respondent. Petitioner
is claiming the amount of P1,100 as balance from proceeds of copra
sale. Private respondents contend that this P1,100 is their compensation
pursuant to tenurial arrangements. Since this amount is intertwined
with the resolution of agra dispute, CA correctly ruled that DARAB has
jurisdiction. RTC has only jurisdiction over criminal and it acted beyond
when it ruled that agri tenancy between parties. This belongs to DARAB.
BEJASA v. CA
FACTS:
Candelaria owned two parcels of land, which she leased to Malabanan.
Malabanan hired the Bejasas to plant on the land and clear it, with all the
expenses shouldered by Malabanan. Bejasas continued to stay on the land and
did not give any consideration for its use, be it in the form of rent or a shared
harvest
ISSUE: Whether or not there is a tenancy relationship in favor of the Bejasas
SC:
Court found that there was no tenancy relationship between the parties. There
was no proof that Malabanan and the Bejasas shared the harvests. Candelaria
never gave her consent to the Bejasas stay on the land . There was no proof
that the Dinglasans gave authority to the Bejasas to be the tenant of the land in
question. Not all the elements of tenancy were met in this case. There was no
proof of sharing in harvest. While Bejasa testified, SC said only Bejasas word
was presented to prove this. Besides testimony was suspicious because of
inconsistency Bejasa testified that he agreed to deliver 1/5 of harvest as owners
share, yet at one time, he also mentioned that 25% was for Malabanan and 50%
for owner. Moreover, landowners never gave consent, citing Chico vs. CA , 284
Page 25
534 self serving statement are inadequate, proof must be adhered. Even
assuming that landowner agreed to lease it for P20,000per year, such
agreement did not prove tenancy . Consideration should be harvest sharing.
VALENCIA v. CA
FACTS:
- Valencia is the owner of land, she leased the property for five (5)years
to Fr. Andres Flores under a civil law lease concept; lease with
prohibition against subleasing or encumbering the land without
Valencias written consent. During the period of his lease, private
respondents were instituted to cultivate without consent of Valencia.
After lease, Valencia demanded vacate but refused; Private respondents
were later awarded with CLTs after they filed application with DAR; CLTs
were upheld by Exec Sec and CA.
ALMUETE v. ANDRES (Issue on Ownership)
Facts:
Almuete was in exclusive possession of subject land. Unknown to
Almuete, Andres was awarded homestead patent due to investigation
report that Almuete was unknown and waived his rights; Andres also
represented that Almuete sold the property to Masiglat for radiophone
set and that Masiglat sold to him for a carabao and P600. Almuete filed
an action for recovery of possession and reconveyance before trial court.
Issue is who between 2 awardees of lot has better right to property.
SC:
This is controversy relating to ownership of farmland so, beyond the ambit
of agrarian dispute. No juridical tie of landowner and tenant was alleged
between petitioners and respondent. RTC was competent to try the case.
PASONG BAYABAS v. CA : no evidence
Development of land: converted from agricultural to residential as
approved by DAR. Petitioners, claimed they are actual tillers of land,
they filed a complaint for damages alleging surreptitious conversion; priv
resp denied cultivation & waiver of rights was executed by some.
SC : no tenancy
no allegation in complaint that petitioners members are tenants; waiver
of rights constitutes abandonment. No substantial evidence that private
respondent is landlord. Possession/entry is w/o knowledge of owner.
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
Cultivation / possession not proven. As to the remaining twenty and
more other complainants, it is unfortunate that they have not shown that
their cultivation, possession and enjoyment of the lands they claim to till
have been by authority of a valid contract of agricultural tenancy. On the
contrary, as admitted in their complaint a number of them have simply
occupied the premises in suit without any specific area of tillage being
primarily mere farm helpers of their relatives
ESCARIZ v. REVILLEZA : tenancy is not presumed
Involving fruit on land owned by private respondent. Petitioner is
claiming tenancy. DARAB considered petitioner a tenant; CA reversed
SC: Tenancy is not presumed. There was no evidence to prove consent of parties
and sharing of harvest. SC agreed with CA that there is no evidence on record to
prove the existence of the following elements: (a) the consent of the parties and
(b) the sharing of harvests.
HEIRS OF JUGALBOT V. CA
FACTS:
Jugalbot was issued EP; EP was challenged by Heirs of priv resp before
DARAB and seek cancellation of title and recovery possession; on appeal, DARAB
upheld but CA reversed.
SC: Absence of tenancy relationship. The taking of property violated due
process (CA was correct in pointing out that Virginia A. Roa was denied due
process because the DAR failed to send notice of the impending land reform
coverage to the proper party); no ocular inspection or any on-site fact-finding
investigation and report to verify the truth of the allegations of Nicolas Jugalbot
that he was a tenant of the property. By analogy, Roxas & Co., Inc. v. Court of
Appeals applies to the case at bar since there was likewise a violation of due
process. No concrete evidence of cultivation; No proof was presented except for
their self-serving statements. Independent evidence, aside from self-serving
statements, is needed. Plus CA findings- Jugalbot was soldier of US Army and
migrated to US and returned only in 1998, wife and daughter were residents of
California. Land involved is residential and not agricultural because of zoning
ordinance. Coverage Section 4: All alienable and disposable public lands. All
private lands devoted to or suitable to agriculture Schedule of implementation
Sec. 5 The distribution xxx shall be implemented immediately and completed
within ten years from effectivity hereof. Sec. 63: The initial amount needed to
Page 26
implement this Act for the period of ten years upon approval hereof shall be
funded from the Agrarian Reform Fund created under Sections 20 and 21 of
Executive Order No. 299. xxx.. RA 8542: amended Sec. 63 as follows: The
amount needed to implement this Act until 2008 shall be funded from the
Agrarian Reform Fund. RA 9700, Sec. 21:
The amount needed to further implement the CARP as provided in this
Act, until June 30, 2014, upon expiration of funding under Republic Act No. 8532
and other pertinent laws, shall be funded from the Agrarian Reform Fund and
other funding sources in the amount of at least One hundred fifty billion pesos
(P150,000,000,000.00)
SPOUSES JESUS FAJARDO and EMER FAJARDO, vs. ANITA R. FLORES
Facts:
Leopoldo delos Reyes owned a parcel of land located in Barangay Sumandig in
Hacienda Buenavista, San Ildefonso, Bulacan. In 1963, he allowed petitioner
Jesus Fajardo to cultivate said land. The net harvests were divided equally
between the two until 1975 when the relationship was converted to leasehold
tenancy. Per Order 2 from the Department of Agrarian Reform (DAR), Regional
Office, Region III, San Fernando, Pampanga, rent was provisionally fixed at 27.42
cavans per year, which Jesus Fajardo religiously complied with. From the time
petitioner cultivated the land, he was allowed by Leopoldo delos Reyes to erect a
house for his family on the stony part of the land, which is the subject of
controversy.
On January 26, 1988, Leopoldo delos Reyes died. His daughter and sole heir,
herein respondent Anita Flores, inherited the property. On June 28, 1991, Anita
Flores and Jesus Fajardo executed an agreement, denominated as "KASUNDUAN
NG PAGHAHATI NG LUPA AT PAGTATALAGA NG DAAN UKOL SA MAGKABILANG
PANIG." 3 This was followed by another agreement, "KASUNDUAN SA HATIAN SA
LUPA," executed on July 10, 1991, wherein the parties agreed to deduct from Lot
No. 2351 an area of 10,923 sq m, allotting the same to petitioner. Apparently,
there was a conflict of claims in the interpretation of the Kasunduan between
Anita Flores and Jesus Fajardo, which was referred to the DAR, Provincial
Agrarian Reform Office, Baliuag, Bulacan. 4 In the Report and Recommendation
dated May 3, 2000, the Legal Officer advised the parties to ventilate their claims
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
and counterclaims with the Department of Agrarian Reform Adjudication Board
(DARAB), Malolos, Bulacan.
On December 22, 2000, a complaint for ejectment was filed by herein
respondent Anita Flores, assisted by her husband Bienvenido Flores, against
petitioners with the Municipal Trial Court (MTC), San Ildefonso, Bulacan. In the
complaint, she alleged that, as the sole heir of the late Leopoldo delos Reyes,
she inherited a parcel of land consisting of stony land, not devoted to
agriculture, and land suitable and devoted to agriculture located in Barangay
Sumandig, San Ildefonso, Bulacan; that, sometime in the 1960s, during the
lifetime of Leopoldo delos Reyes, Jesus Fajardo requested the former to allow
him to work and cultivate that portion of land devoted to agriculture; that Jesus
Fajardo was then allowed to erect a house on the stony part of the land, and that
the use and occupation of the stony part of the land was by mere tolerance only;
and that the land, which was divided equally between the two parties, excluded
the stony portion. In February 1999, respondent approached petitioners and
verbally informed them of her intention to repossess the stony portion, but
petitioners refused to heed the request.
Issue:
Whether or not MTC or the DARAB which has jurisdiction over the case.
Held:
An agrarian dispute refers to any controversy relating to tenurial arrangements,
whether leasehold, tenancy, stewardship, or otherwise, over lands devoted to
agriculture, including disputes concerning farmworkers' associations or
representation of persons in negotiating, fixing, maintaining, changing, or
seeking to arrange terms or conditions of such tenurial arrangements. It includes
any controversy relating to compensation of lands acquired under this Act and
other terms and conditions of transfer of ownership from landowner to
farmworkers, tenants, and other agrarian reform beneficiaries, whether the
disputants stand in the proximate relation of farm operator and beneficiary,
landowner and tenant, or lessor and lessee. It relates to any controversy relating
to, inter alia, tenancy over lands devoted to agriculture.
Undeniably, the instant case involves a controversy regarding tenurial
arrangements. The contention that the Kasunduans, which allegedly terminated
the tenancy relationship between the parties and, therefore, removed the case
from the ambit of R.A. No. 6657, is untenable. There still exists an agrarian
Page 27
dispute because the controversy involves the home lot of petitioners, an incident
arising from the landlord-tenant relationship.
"Indeed, section 21 of the Republic Act No. 1199, provides that 'all cases
involving the dispossession of a tenant by the landlord or by a third party and/or
the settlement and disposition of disputes arising from the relationship of
landlord and tenant . . . shall be under the original and exclusive jurisdiction of
the Court of Agrarian Relations.' This jurisdiction does not require the
continuance of the relationship of landlord and tenant at the time of the
dispute. The same may have arisen, and often times arises, precisely from the
previous termination of such relationship. If the same existed immediately, or
shortly, before the controversy and the subject-matter thereof is whether or not
said relationship has been lawfully terminated, or if the dispute springs or
originates from the relationship of landlord and tenant, the litigation is (then)
cognizable by the Court of Agrarian Relations . . ."
In the case at bar, petitioners' claim that the tenancy relationship has been
terminated by the Kasulatan is of no moment. As long as the subject matter of
the dispute is the legality of the termination of the relationship, or if the dispute
originates from such relationship, the case is cognizable by the DAR, through the
DARAB. The severance of the tenurial arrangement will not render the action
beyond the ambit of an agrarian dispute.
VICENTE ADRIANO vs. ALICE TANCO
Facts:
On December 18, 1975, respondent Alice Tanco (Alice) purchased a parcel of
land consisting of 28.4692 hectares located in Norzagaray, Bulacan. The land
was devoted to mango plantation. Later on, it was partitioned among the
respondents.
Controversy arose when Alice sent to Vicente a letter 6 dated January 16, 1995
informing him that subject landholding is not covered by the Comprehensive
Agrarian Reform Program (CARP). She asked him to vacate the property as soon
as possible.
Seeing the letter of Alice as a threat to his peaceful possession of subject
farmland which might impair his security of tenure as a tenant, Vicente filed
before the regional office of DARAB in Region III a Complaint for Maintenance of
Peaceful Possession with Prayer for Temporary Restraining Order and/or Writ of
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
Preliminary Injunction. He averred that in 1970, Arsenio Tanco (Arsenio), the
husband of Alice, instituted him as tenant-caretaker of the entire mango
plantation. Since then, he has been performing all phases of farm works, such as
clearing, pruning, smudging, and spraying of the mango trees. The fruits were
then divided equally between them. He also alleged that he was allowed to
improve and establish his home at the old building left by Ang Tibay Shoes
located at the middle of the plantation. Presently, he is in actual possession of
and continues to cultivate the land.
In their Answer, respondents denied having instituted any tenant on their
property. They stressed that Vicente never worked and has no employer-
employee relationship with Geraldine, Ronald, and Patrick. Insofar as Alice is
concerned, respondents asserted that Vicente is not a tenant but a mere regular
farm worker.
Issue:
WHETHER or not VICENTE IS A BONA FIDE tenant.
Held:
Tenancy relationship is a juridical tie which arises between a landowner and a
tenant once they agree, expressly or impliedly, to undertake jointly the
cultivation of a land belonging to the landowner, as a result of which relationship
the tenant acquires the right to continue working on and cultivating the land. 23
The existence of a tenancy relationship cannot be presumed and allegations that
one is a tenant do not automatically give rise to security of tenure. 24 For
tenancy relationship to exist, the following essential requisites must be present:
(1) the parties are the landowner and the tenant; (2) the subject matter is
agricultural land; (3) there is consent between the parties; (4) the purpose is
agricultural production; (5) there is personal cultivation by the tenant; and, (6)
there is sharing of the harvests between the parties. 25 All the requisites must
concur in order to establish the existence of tenancy relationship, and the
absence of one or more requisites is fatal.
After a thorough evaluation of the records of this case, we affirm the findings of
the CA that the essential requisites of consent and sharing are lacking.
The essential element of consent is sorely missing because there is no proof that
the landowners recognized Vicente, or that they hired him, as their legitimate
tenant. And, although Vicente claims that he is a tenant of respondents'
Page 28
agricultural lot in Norzagaray, Bulacan, and that he has continuously cultivated
and openly occupied it, no evidence was presented to establish the presence of
consent other than his self-serving statements. These cannot suffice because
independent and concrete evidence is needed to prove consent of the
landowner.
Likewise, the essential requisite of sharing of harvests is lacking. Independent
evidence, such as receipts, must be presented to show that there was sharing of
the harvest between the landowner and the tenant. 28 Self-serving statements
are not sufficient.
Here, there was no evidence presented to show sharing of harvest in the context
of a tenancy relationship between Vicente and the respondents. The only
evidence submitted to establish the purported sharing of harvests were the
allegations of Vicente which, as discussed above, were self-serving and have no
evidentiary value. Moreover, petitioner's allegations of continued possession and
cultivation do not support his cause. It is settled that mere occupation or
cultivation of an agricultural land does not automatically convert a tiller or farm
worker into an agricultural tenant recognized under agrarian laws. 30 It is
essential that, together with the other requisites of tenancy relationship, the
agricultural tenant must prove that he transmitted the landowner's share of the
harvest.
Neither can we agree with the DARAB's theory of implied tenancy because the
landowner never acquiesced to Vicente's cultivating the land. Besides, for
implied tenancy to arise it is necessary that all the essential requisites of
tenancy must be present.
ESTATE OF PASTOR M. SAMSON vs. MERCEDES R. SUSANO
Facts:
Pastor M. Samson (Pastor) owned a 1.0138-hectare parcel of land known as Lot
1108 of the Tala Estate Subdivision located in Bagumbong, Caloocan City.
Pastor was approached by his friend Macario Susano (Macario) who asked for
permission to occupy a portion of Lot 1108 to build a house for his family. Since
Pastor was godfather to one of Macario's children, Pastor acceded to Macario's
request. Macario and his family occupied 620 square meters of Lot 1108 and
devoted the rest of the land to palay cultivation. Herein respondents, Macario's
wife Mercedes R. Susano and their son Norberto R. Susano, insist that while no
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
agricultural leasehold contract was executed by Pastor and Macario, Macario
religiously paid 15 cavans of palay per agricultural year to Pastor, which rent
was reduced by Pastor in 1986 to 8 cavans of palay per agricultural year.
Pastor subdivided Lot 1108 into three portions of which he sold portions of it
without Macario's knowledge.
Pastor sold 2,552 square meters of Lot 1108-A to spouses Felix Pacheco and
Juanita Clamor, allegedly also without Macario's knowledge and consent.
According to respondents, no written notice was sent by Pastor to Macario prior
to the sale to Chan of Lot 1108-C comprising an area of 6,696 square meters.
They aver that Macario came to know of the transaction only after Chan visited
the property sometime in October 1990 accompanied by an employee from the
city government.
Issue:
Whether or not there was a tenancy relation between Pastor Samson and
Macario Susano and in binding herein petitioner.
Held:
We find in favor of petitioners. Applying our pronouncement in Levardo v. Yatco,
51 we rule that the subject land cannot be subject to the OLT program of P.D.
No. 27 for two reasons: first, the subject land is less than seven hectares; and
second, respondents failed to show that Pastor owned other agricultural lands in
excess of seven hectares or urban land from which he derived adequate income,
as required by Letter of Instruction (LOI) No. 474. 52
Moreover, the DAR Memorandum on the "Interim Guidelines on Retention by
Small Landowners" dated July 10, 1975 is explicit:
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 . . . 53
However, while the disputed landholding which had an original aggregate area
of only 1.0138 hectares is not covered by the OLT program, the same may still
be covered by P.D. No. 27, albeit under its Operation Land Leasehold (OLL)
program. The OLL program placed landowners and tenants of agricultural land
devoted to rice and corn into a leasehold relationship as of October 21, 1972. 54
Page 29
But the fact that Macario, respondents' predecessor-in-interest, was a de jure
tenant must be established.
In the case at bar, while the RARAD, DARAB and the CA are unanimous in their
conclusion that an implied tenancy relationship existed between Pastor Samson
and Macario Susano, no specific evidence was cited to support such conclusion
other than their observation that Pastor failed to protest Macario's possession
and cultivation over the subject land for more than 30 years. Contrary to what is
required by law, however, no independent and concrete evidence were adduced
by respondents to prove that there was indeed consent and sharing of harvests
between Pastor and Macario.
It has been repeatedly held that occupancy and cultivation of an agricultural
land will not ipso facto make one a de jure tenant. Independent and concrete
evidence is necessary to prove personal cultivation, sharing of harvest, or
consent of the landowner. Substantial evidence necessary to establish the fact
of sharing cannot be satisfied by a mere scintilla of evidence; there must be
concrete evidence on record adequate to prove the element of sharing. To prove
sharing of harvests, a receipt or any other credible evidence must be presented,
because self-serving statements are inadequate. Tenancy relationship cannot be
presumed; the elements for its existence are explicit in law and cannot be done
away with by conjectures. Leasehold relationship is not brought about by the
mere congruence of facts but, being a legal relationship, the mutual will of the
parties to that relationship should be primordial. For implied tenancy to arise it is
necessary that all the essential requisites of tenancy must be present.
The affidavits executed by three of respondents' neighbors are insufficient to
establish a finding of tenancy relationship between Pastor and Macario.
JUAN GALOPE vs. CRESENCIA BUGARIN
Facts:
Respondent owns a parcel of land. Petitioner farms the land.
In Barangay Case No. 99-6, respondent complained that she lent the land to
petitioner in 1992 without an agreement, that what she receives in return from
petitioner is insignificant, and that she wants to recover the land to farm it on
her own. Petitioner countered that respondent cannot recover the land yet for he
had been farming it for a long time and that he pays rent ranging from P4,000 to
P6,000 or 15 cavans of palay per harvest. The case was not settled. 5
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
Represented by Celso Rabang, respondent filed a petition for recovery of
possession, ejectment and payment of rentals before the Department of
Agrarian Reform Adjudication Board (DARAB), docketed as DARAB Case No.
9378. Rabang claimed that respondent lent the land to petitioner in 1991 and
that the latter gave nothing in return as a sign of gratitude or monetary
consideration for the use of the land. Rabang also claimed that petitioner
mortgaged the land to Jose Allingag who allegedly possesses the land.
Provincial Adjudicator dismissed the petition and ruled that petitioner is a tenant
entitled to security of tenure. The Adjudicator said substantial evidence prove
the tenancy relationship between petitioner and respondent. The Adjudicator
noted the certification of the Department of Agrarian Reform (DAR) that
petitioner is the registered farmer of the land; that Barangay Tanods said that
petitioner is the tenant of the land; that Jose Allingag affirmed petitioner's
possession and cultivation of the land; that Allingag also stated that petitioner
hired him only as farm helper; and that respondent's own witness, Cesar Andres,
said that petitioner is a farmer of the land.
The DARAB found no tenancy relationship between the parties and stressed that
the elements of consent and sharing are not present. The DARAB noted
petitioner's failure to prove his payment of rentals by appropriate receipts, and
said that the affidavits of Allingag, Rolando Alejo and Angelito dela Cruz are self-
serving and are not concrete proof to rebut the allegation of nonpayment of
rentals. The DARAB added that respondent's intention to lend her land to
petitioner cannot be taken as implied tenancy for such lending was without
consideration.
Issue:
Whether or not there is a tenancy relationship
Held:
The matter of rental receipts is not an issue given respondent's admission that
she receives rentals from petitioner. To recall, respondent's complaint in
Barangay Case No. 99-6 was that the rental or the amount she receives from
petitioner is not much. 14 This fact is evident on the record 15 of said case
which is signed by respondent and was even attached as Annex "D" of her
DARAB petition. Consequently, we are thus unable to agree with DARAB's ruling
that the affidavits 16 of witnesses that petitioner pays 15 cavans of palay or the
equivalent thereof in pesos as rent are not concrete proof to rebut the allegation
Page 30
of nonpayment of rentals. Indeed, respondent's admission confirms their
statement that rentals are in fact being paid. Such admission belies the claim of
respondent's representative, Celso Rabang, that petitioner paid nothing for the
use of the land.
Respondent's act of allowing the petitioner to cultivate her land and receiving
rentals therefor indubitably show her consent to an unwritten tenancy
agreement. An agricultural leasehold relation is not determined by the explicit
provisions of a written contract alone. Section 5 18 of Republic Act (R.A.) No.
3844, otherwise known as the Agricultural Land Reform Code, recognizes that an
agricultural leasehold relation may exist upon an oral agreement.
Thus, all the elements of an agricultural tenancy relationship are present.
Respondent is the landowner; petitioner is her tenant. The subject matter of
their relationship is agricultural land, a farm land. 19 They mutually agreed to
the cultivation of the land by petitioner and share in the harvest. The purpose of
their relationship is clearly to bring about agricultural production. After the
harvest, petitioner pays rental consisting of palay or its equivalent in cash.
Respondent's motion 20 to supervise harvesting and threshing, processes in
palay farming, further confirms the purpose of their agreement. Lastly,
petitioner's personal cultivation of the land 21 is conceded by respondent who
likewise never denied the fact that they share in the harvest.
Chapter II (Coverage)
HOMESTEAD GRANTEES (Sec.6)
HOMESTEAD PATENT
A mode of acquiring alienable and disposable lands of public domain for
agricultural purposes conditioned upon actual cultivation and residence.
filed at CENRO where land being applied is located.
who are qualified - citizens of Philippines over 18 years old &
not an owner of more than 12 hectares of land (Art XII, Sec. 3,
1987 Constitution)
designed to distribute disposable agricultural lots of the State to land-
destitute citizens for their home and cultivation. Pursuant to such
benevolent intention the State prohibits the sale or encumbrance of the
homestead (CA 141, Section 116) within five years after the grant of the
patent. After that five-year period the law impliedly permits alienation of
the homestead, but in line with the primordial purpose to favor with the
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
homesteader and his family the statute provides that such alienation or
conveyance (Section 117) shall be subject to the right of repurchase by
the homesteader, his widow or heirs.
CARL recognizes rights of homesteaders(Sec.6,)
expressly recognized in Sec. 6, Art XIII, Constitution
Alita vs. CA, 170 SCRA 706
Facts:
Two parcels of land in Tungawan, Zamboanga del Norte wer acquired
by private respondents predecessors-in-interest through homestead patent
under the provisions C.A. No. 141.
Private respondents/owners Enrique Reyes, et al. herein are desirous of
personally cultivating these lands, but petitioners/tenants Gabino Alita refuse to
vacate, relying n the provisions of PD 27 and PD 316 and appurtenant
regulations issued by the Ministry of Agrarian Reform.
Held:
We agree with the petitioners in saying that PD 27 decreeing the
emancipation of tenants from the bondage of the soil and transferring to them
ownership of the land they till is a sweeping social legislation, a remedial
measure promulgated pursuant to the social justice precepts of the Constitution.
However, such contention cannot be invoked to defeat the very purpose of the
enactment of the Public Land Act or CA No. 141. Thus,
The Homestead Act has been enacted for the welfare and
protection of the poor. The law gives a needy citizen a piece of land where he
may build a modest house for himself and family and plant what is necessary for
subsistence and for the satisfaction of lifes other needs.xxx
Both the Philippine constitution and the CARL respect the superiority of the
homesteaders right over the right of the tenants guaranteed by the Agrarian
Reform Statute.
In this regard, the Philippine Constitution likewise respects the superiority of the
homesteaders' rights over the rights of the tenants guaranteed by the Agrarian
Reform statute. In point is Section 6 of Article XIII of the 1987 Philippine
Constitution which provides:
Page 31
The State shall apply the principles of agrarian reform or stewardship,
whenever applicable in accordance with law, in the disposition or utilization of
other natural resources, including lands of public domain under lease or
concession suitable to agriculture, subject to prior rights, homestead rights of
small settlers, and the rights of indigenous communities to their ancestral
lands.
Additionally, it is worthy of note that the newly promulgated Comprehensive
Agrarian Reform Law of 1988 or Republic Act No. 6657 likewise contains a
proviso supporting the inapplicability of P.D. 27 to lands covered by homestead
patents like those of the property in question, reading,
Section 6. Retention Limits. xxxx... Provided further, That original homestead
grantees or their direct compulsory heirs who still own the original homestead at
the time of the approval of this Act shall retain the same areas as long as they
continue to cultivate said homestead.
ALITA v. CA: (1989)
private respondents predecessors-in-interest have acquired 2
parcels of land in Zamboanga del Sur thru homestead patent
petitioners/ tenants refuse to vacate relying on PD27
SC:
PD decreed the emancipation of tenants from bondage of soil and
transferring to them ownership of land they till.
However, PD27 cannot be involved to defeat the very purpose of CA 141
(Public Land Act)
Phil. Constitution respects the superiority of homesteaders rights and
CARL also.
Sec. 6:
Provided, further, That original homestead grantees or their direct
compulsory heirs who still own the original homestead at the time of the
approval of this Act shall retain the same areas as long as they continue to
cultivate said homestead.
Paris vs. Alfeche, 364 SCRA 110
Facts:
Petitioner Florencia Paris is the owner of 10.6146 hectare of land in
Paitan,Bukidnon. The said parcels are fully tenanted by private respondents
Dionisio Alfeche, et al. who are recipients of Emancipation Patents in their
names pursuant to Operation Land Transfer (OLT) under PD 27 notwitstanding
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
the fact that neither the tenants nor the Land Bank [has] paid a single centavo
for the said land.
Petitioner contends that since she is entitled to a retention of 7
hectares under PD 27 and/or 5 hectares and 3 hectares each for her children
under CARL., the tenants are not supposed to acquire the subject land and the
Emancipation Patents precipitately issued to them are null and void for being
contrary to law. Petitioner further alleged that she owns the subject property as
original homestead grantee who still owned the same when RA 6657 was
approved, thus she is entitled to retain the area to the exclusion of her tenants.
As regards to the land, petitioner has applied for retention of 7 hectares
contending that the lands subject of the instant petition are covered by
Homestead Patents, and as decided by the Supreme Court in Patricio vs. Bayug
and Alita vs. CA, the homesteaders and their heirs have the right to cultivate
their homesteads personally, which is a superior right over that of tenant-
farmers.
Held:
Petitioners contention is without legal basis. PD 27, under which the EP
sought to be canceled here were issued to respondents, applies to all tenanted
private agricultural lands primarily devoted to rice and corn under a system of
share-crop or lease-tenancy, whether classified as landed estate or not. The law
makes no exceptions whatsoever in its coverage. Nowhere therein does it
appear that the lots obtained by homestead patents are exempt from it
operation.
Petitioners claimed entitlement to retain 7 hectares is also untenable.
PD 27, which provides the retention limit, states:
In all cases, the landowner may retain an area of not more than 7 hectares if
such landowner is cultivating such area or will now cultivate it.
Clearly, the right to retain an area of 7 hectares is not absolute. It is
premised on the condition that the landowner is cultivating the area sought to
be retained or will actually cultivate it upon effectivity of the law.
In the case at bar, neither of the conditions for retention is present. As
admitted by petitioner herself, the subject parcels are fully tenanted; thus, she is
clearly not cultivating them, not will she personally cultivate any part thereof.
Undoubtedly, therefore, she has no right to retain any portion of her
landholdings.
Even under the current primary law on agrarian reform, Republic Act
(RA) No. 6657, to which the application of PD 27 is suppletory, petitioner's lands
are subject to land reform. The said Act lays down the rights of homestead
grantees under Sec. 6 thereof.
Page 32
Indisputably, homestead grantees or their direct compulsory heirs can own and
retain the original homesteads, only for "as long as they continue to cultivate"
them. That parcels of land are covered by homestead patents will not
automatically exempt them from the operation of land reform. It is the fact of
continued cultivation by the original grantees or their direct compulsory heirs
that shall exempt their lands from land reform coverage.
Neither petitioner nor her heirs are personally cultivating the subject
homesteads. The DAR and the CA found that respondents were the ones who
had been cultivating their respective portions of the disputed properties.
However, petitioner can retain five (5) hectares in accordance with
Section 6 of RA 6657, which requires no qualifying condition for the landowner to
be entitled to retain such area.
Petitioner's heirs, however, are not entitled to awards of three (3)
hectares each, since they are not actually tilling the parcels or directly managing
the farm.
PARIS v. ALFECHE (2001)
Paris is owner of 10 hectares in Bukidnon and another property of 13
hectares. She admitted that land is fully tenanted by private
respondents Alfeche,et al.
Paris claimed that she is entitled to retention and that as original
homestead grantee, she is entitled to retain the lands to the exclusion of
tenants.
SC :
Petitioners contention is w/o legal basis. PD applies to all tenanted
private agriculture lands primarily devoted to rice and corn. Nowhere
does it appear that lots obtained by homestead patents are exempted
from its operation. Under RA 6657, rights of homestead grantee are
provided but with condition: only for as long as they continue to
cultivate them. That parcels of land are covered by homestead will not
automatically exempt them from operation of land reform. It is the fact
of continued cultivation by original grantees or direct compulsory heirs
that shall exempt their lands. Petitioner can retain however 5 hectares
which require no qualifying condition (Sec.6)
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
RETENTION RIGHTS
NCC: conjugal total is 5; capital/paraphernal not more than 5 each but not
exceed 10
FC (Aug.3,1988) per DAR Adm. Order No. 2, s. 2003:
capital/paraphernal - not to exceed 5 provided with judicial separation
absolute (presumed) not to exceed 5
LANDOWNERs RETENTION RIGHTS
Is this right defeated by the issuance of CLTs/EPs or CLOAs?
DAEZ v. CA
Issuance of EPs/CLOAs to beneficiaries does not absolutely bar
landowner from retaining the area. In fact, EP or CLOA may be cancelled if land
covered in later found to be part of landowners retained area. In this case, CLTs
of private respondent were leased w/o according Daez her right of choice. So
DAR was ordered to fully accord Daez her rights under Sec.6 of RA 6657.
Retention by landowner: 5 hectares
Retention by each child of landowner: 3 hectares provided:
1. at least 15 years of age; and
2. actually tilling the land or directly managing the farm
DAR Adm. Order # 2, S.2003
Who may apply for retention
Period to exercise right of retention
Where to file
Instance where owner is considered to have waived his right of retention
Operating produces : MARO PARO REG. DIRECTOR- Sec. (Appeal)
That landholdings of landowners with a total area of five (5) hectares and below
shall not be covered for acquisition and distribution to qualified beneficiaries.
(RA 9700, Sec. 3)
SEC. 6-A. Exception to Retention Limits. - Provincial, city and municipal
government ,units acquiring private agricultural lands by expropriation or other
Page 33
modes of acquisition to be used for actual, direct and exclusive public purposes,
such as roads and bridges, public markets, school sites, resettlement sites, local
government facilities, public parks and barangay plazas or squares, consistent
with the approved local comprehensive land use plan, shall not be subject to the
five (5)-hectare retention limit under this Section xxx. (RA 9700, Sec. 4)
Sec. 10. Exemptions and Exclusions from coverage of CARL
(a) Lands ADE used for parks, wildlife, forest reserves, reforestation, fish
sanctuaries and breeding grounds, watersheds and mangroves (exempt);
(b) private lands ADE used for prawn farms and fishponds (exempt)
(c) lands ADE used and found to be necessary for national defense, school sites
and campuses including experimental farm stations, seeds and seedlings
research, church sites and convents, mosque sites, communal burial grounds
and cemeteries, penal colonies and farms and all lands with 18% slope and over
(exempt)
DAR ADMINISTRATIVE ORDER NO. 06-06
SECTION 3. Qualifications of Children-Awardees. The child of a landowner
whose landholding is subject of acquisition and distribution under the CARP may
be awarded and given preference in the distribution of said lands if he/she
meets all of the following criteria: DaCTcA
3.1 Filipino citizen;
3.2 At least fifteen (15) years of age; and
3.3 Actual tillers or one directly managing the farm as of June 15, 1988 up to
the time of the conduct of field investigation of the landholding under CARP.
Direct management shall refer to the cultivation of the land through personal
supervision under the system of labor administration. It shall be interpreted
along the lines of farm management as an actual major activity being performed
by the landowner's child from which he/she derives his/her primary source of
income.
SECTION 4. Rights and Obligations. The children-awardees shall have the
following rights and obligations:
4.1 All children-awardees shall exercise diligence in the use, cultivation and
maintenance of the land including the improvements thereon. Unauthorized sale
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
of the land, or negligence or misuse of the land and support extended to
children-awardees, and other violations under existing guidelines shall be
grounds for the forfeiture of their right as such;
4.2 Lands awarded to qualified children of landowners may not be sold,
transferred or conveyed except through hereditary succession or to the
government, or to the LBP, or to other qualified beneficiaries for a period of ten
(10) years; Provided, however, that the children or the spouse of the transferor
shall have a right to repurchase the land from the government or the LBP within
a period of two (2) years from the date of transfer; and
4.3 The children-awardees may avail of any support services being provided
by the government in agrarian reform areas.
Exemptions from coverage (Section 10)
Sec. 10. Exemptions and Exclusions from coverage of CARL
(a) Lands ADE used for parks, wildlife, forest reserves, reforestation, fish
sanctuaries and breeding grounds, watersheds and mangroves (exempt);
(b) private lands ADE used for prawn farms and fishponds (exempt)
(c) lands ADE used and found to be necessary for national defense, school sites
and campuses including experimental farm stations, seeds and seedlings
research, church sites and convents, mosque sites, communal burial grounds
and cemeteries, penal colonies and farms and all lands with 18% slope and over
(exempt)
CENTRAL MINDANAO v. DARAB
The subject lands are exempted because they are actually, directly &
exclusively used and found necessary for school site and campus,
including experimental farm stations for educational purposes and for
establishing seed and seeding research
The construction of DARAB in Section 10 restricting the land area of
CMU to its present needs overlooked the significant factor it growth of a
university in years to come. By the nature of CMU, which is a school
established to promote agriculture & industry, the need for vast tract of
agriculture land for future programs of expansion is obvious.
While portion of CMU land was leased by Phil. Packing Corp.(now Del
Monte), the agreement was prior to CARL & was directly connected to
the purpose & objectives of CMU as educational institution
Page 34
 As to determination of when and what lands are found to be necessary
for use of CMU, school is in best position to resolve & answer the
question. DARAB & CA have no right to substitute unless it is manifest
that CMU has no real need for land.
Atlas Fertilizer Corp. vs. Secretary of DAR, 274 SCRA 30
Facts:
Petitioners are engaged in the aquaculture industry utilizing fishponds
and prawn farms. They question Sections 3[b], 11, 13, 6[d], 17 and 32 of RA
6657 as unconstitutional because they extend the agrarian reform to
aquaculture lands even as Sec. 4, Art. 13 of the Constitution limits agrarian
reform only to agricultural lands.
Held:
The Court ruled that provisions of RA 7881 expressly states that fishpond and
prawn farms are excluded from the coverage of CARL. Thus, petition to question
the constitutionality of some portion of the Comprehensive Agrarian Reform Law
is moot and academic with the passage of RA 7881.
Atlas Fertilizer v. Sec.
Atlas engaged in the aquaculture industry utilizing fishponds and prawn
farms; challenged RA 6657 which coverage lands devoted to the
aquaculture industry, particularly fishponds and prawn farms.
SC:
R.A. No. 7881 expressly state that fishponds and prawn farms are
excluded from the coverage of CARL. In view of the foregoing, the question
concerning the constitutionality of the assailed provisions has become moot and
academic with the passage of R.A. No. 7881
Sanchez v. Marin
Issue:
Whether the subject fishpond is exempted/excluded from the coverage
of the Comprehensive Agrarian Reform Program of the government by virtue of
the amendments introduced by R.A. No. 7881 to R.A. No. 6657
SC:
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
Section 2 of Republic Act No. 7881 amended Section 10 of Republic Act
No. 6657 by expressly exempting/excluding private lands actually, directly and
exclusively used for prawn farms and fishponds from the coverage of the CARL.
Republic vs. CA, 342 SCRA 189
Facts:
Parcels of land in Jala-Jala, Rizal was covered and has a tax declaration
classifying the said land as agricultural. The DAR then issued a Notice of
Coverage of the subject parcels of land under compulsory acquisition pursuant
to Section 7, Chapter II of RA 6657.
Private respondent corporation filed with the DAR office an application for
exemption of the land from agrarian reform but the same was denied.
The CA reversed the DAR orders declaring those portions of the land of the
petitioner which are mountainous and residential to be exempt from the CARP.
DAR then appealed to SC contending and claiming that the subject properties
have already been classified as agricultural based on the tax declaration and
therefore is covered by CARL.
Held:
RA 6657 (CARL) covers all private and agricultural land. Agricultural lands are
land devoted for agricultural activity and not classified as minerals, forest,
residential commercial or industrial
No law or jurisprudence holds that the land classification embodied in the tax
declarations is conclusive and final nor would proscribe any further inquiry. The
DAR administrative order no.6 lists the other documents, aside from tax
declaration, that must be submitted when applying for exception from CARP.
The classification made by the Land Regulatory Board outweighed the
classification stated in the tax declaration.
REPUBLIC v. CA
Tax declaration classified subject land as agricultural. DAR issued notice of
coverage & owner applied for exemption. Application was denied and on appeal
the Court of Appeals created a commission to conduct ocular inspection and
survey the land. Later, based on the report submitted by the commission, the
Court of Appeals reversed the Order of the DAR and exempted the lands from
CARL. Republic contends that tax declaration classified it as agriculture & which
cannot be altered by mere ocular inspection.
Page 35
SC: There is no law/jurisprudence that land classification in tax declaration is
conclusive; tax declaration is clearly not sole basis of classification of land. SC
gave credence to commissions report. Based on their report, it was found that
the land use map submitted by private respondent was an appropriate
document consistent with the existing land use. It was confirmed that the lands
are not wholly agricultural as they consist of mountainous area with an average
of 28% slope. The CARL has further provided that all lands with 18% slope and
over except those already developed shall be exempt from the coverage of
CARL.
Sta. Rosa Realty Devt Corp. vs. CA, 367 SCRA 175
Facts:
Petitioner Sta. Rosa Realty Development Corporation was the registered
owner of two parcels of land at Cabuyao, Laguna. According to the petitioner,
the parcels of land are watersheds, which provide clean potable water to the
Canlubang community, and thet 90% light industries are now located in the
area. Thus, praying for the exemption of the said parcels of land for the
compulsory acquisition under CARP.
Held:
The disputed land is classified as PARK and subsequent studies and
survey showed that the parcel of land in question forms a vital part of a
watershed. Article 10 of RA 6657 expressly states that Lands actually, directly
and exclusively used for parks, wildlife, forest reserves, reforestation, fish
sanctuaries and breeding grounds, watersheds and mangroves shall be exempt
from the coverage of this Act.
Another factor that needs to be mentioned is the fact that during the
DARAB hearing, petitioner presented proof that the Casile property has slopes of
18% and over, which exempted the land from the coverage of CARL. R. A. No.
6657, Section 10, provides:
"Section 10. Exemptions and Exclusions. xxx..and all lands with eighteen
percent (18%) slope and over, except those already developed shall be exempt
from coverage of this Act."
Hence, during the hearing at DARAB, there was proof showing that the disputed
parcels of land may be excluded from the compulsory acquisition coverage of
CARP because of its very high slopes.
NICORP MANAGEMENT AND DEVELOPMENT CORPORATION vs. LEONIDA
DE LEON
Facts:
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
On August 26, 2004, respondent filed a complaint before the Office of the
Provincial Agrarian Reform Adjudicator (PARAD) of Region IV-Province of Cavite,
praying that petitioners Salvador R. Lim and/or NICORP Management and
Development Corporation (NICORP) be ordered to respect her tenancy rights
over a parcel of land located in Barangay Mambog III, Bacoor, Cavite, registered
under TCT No. T-72669 in the name of Leoncia De Leon and Susana De Leon
Loppacher (De Leon sisters), who were likewise impleaded as parties-defendants
in the suit.
Respondent alleged that she was the actual tiller and cultivator of the land since
time immemorial with full knowledge and consent of the owners, who were her
sisters-in-law; that sometime in 2004, petitioners circulated rumors that they
have purchased the property from the De Leon sisters; that petitioners ignored
respondent's requests to show proof of their alleged ownership; that on August
12, 2004, petitioners entered the land and uprooted and destroyed the rice
planted on the land and graded portions of the land with the use of heavy
equipment; that the incident was reported to the Municipal Agrarian Reform
Office (MARO) which issued a Cease and Desist Order 5 but to no avail.
Respondent thus prayed that petitioners be ordered to respect her tenancy
rights over the land; restore the land to its original condition and not to convert
the same to non-agricultural use; that any act of disposition of the land to any
other person be declared null and void because as a tenant, she allegedly had a
right of pre-emption or redemption over the land.
Petitioner Lim denied that respondent was a tenant of the subject property
under the Comprehensive Agrarian Reform Program (CARP). He alleged that
respondent is a septuagenarian who is no longer physically capable of tilling the
land; that the MARO issued a certification 7 that the land had no registered
tenant; that respondent could not be regarded as a landless tiller under the
CARP because she owns and resides in the property adjacent to the subject land
which she acquired through inheritance; that an Affidavit of Non-Tenancy 8 was
executed by the De Leon sisters when they sold the property to him. DTIaCS
Moreover, Lim claimed that respondent and her family surreptitiously entered
the subject land and planted a few crops to pass themselves off as cultivators
thereof; that respondent tried to negotiate with petitioner Lim for the sale of the
land to her, as the latter was interested in entering into a joint venture with
another residential developer, which shows that respondent has sufficient
resources and cannot be a beneficiary under the CARP; that the land is no longer
Page 36
classified as agricultural and could not thus be covered by the CARP. Per
certification issued by the Office of the Municipal Planning and Development
Coordinator of Bacoor, Cavite, the land is classified as residential pursuant to a
Comprehensive Land Use Plan approved by the Sangguniang Panlalawigan.
Issue:
Whether or not the land is exempted.
Held:
In the instant case, there is no substantial evidence to support the appellate
court's conclusion that respondent is a bona fide tenant on the subject property.
Respondent failed to prove the third and sixth elements cited above. It was not
shown that the De Leon sisters consented to a tenancy relationship with
respondent who was their sister-in-law; or that the De Leon sisters received any
share in the harvests of the land from respondent or that the latter delivered a
proportionate share of the harvest to the landowners pursuant to a tenancy
relationship.
The affidavits did not mention at all that the De Leon sisters received a portion
of the harvests or that respondent delivered the same to her sisters-in-law. The
affidavits failed to disclose the circumstances or details of the alleged harvest
sharing; it merely stated that the affiants have known respondent to be the
cultivator of the land since time immemorial. It cannot therefore be deemed as
evidence of harvest sharing.
That respondent was allowed to cultivate the property without opposition, does
not mean that the De Leon sisters impliedly recognized the existence of a
leasehold relation with respondent. Occupancy and continued possession of the
land will not ipso facto make one a de jure tenant.
Finally, the sale of the subject land to petitioners did not violate Sections 65 33
and 73 34 (c) of R.A. No. 6657. There was no illegal conversion of the land
because Sec. 65 applies only to lands which were covered by the CARP, i.e.,
those lands beyond the five-hectare retention limit allowed to landowners under
the law, which were distributed to farmers-beneficiaries. In the instant case, it
was not shown that the subject land was covered by the CARP. Neither was it
shown that the sale was made to circumvent the application of R.A. 6657 or
aimed at dispossessing tenants of the land that they till
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
(Sec. 11) : COMMERCIAL FARMS
Commercial farms private agricultural lands devoted to saltbeds, fruit farms,
orchards, vegetable and cut-flower farms and cacao, coffee and rubber
plantations. They are subject to compulsory acquisition and distribution after 10
years from effectivity.
LUZ FARMS
Sec. II which includes private agricultural land devoted to commercial
livestock, poultry & swine raising in definition of commercial farms is
invalid.
Adm. Order #01 (2004): rules & regulations governing exclusion of agricultural
land used for cattle raising from CARP. Citing Luz Farms case private agricultural
land or portions thereof actually, exclusively &directly used for cattle raising as
of 15 June 1988 shall be excluded. Exclusion shall be granted only upon proof of
AED prior to 15 June 1988 & continuously utilized for such purpose up to
application. Any act to change or convert ; w/ intent to avoid CARP,shall be
invalid. Only the grazing area & portions of property required for infrastructure
necessary for cattle raising shall be considered for exclusion
DAR A.O #9, S of 1998 allows commercial farms certain options, subject to
approval of DAR & workers: (aside from voluntary & compulsory coverage)
CLOAs are issued - joint venture
in name of cooperative - grower ship agreement
of workers - lease back
- direct payment
DAR vs. Sutton, et al., G.R. No. 162070, October 19, 2005
DAR issued A.O. No. 9 to limit the area of livestock farm that may be retained by
a landowner pursuant to its mandate to place all public and private agricultural
lands under the coverage of agrarian reform.
Issue:
The constitutionality of DAR A.O. No. 9, series of 1993.
Held:
Page 37
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.
The fundamental rule in administrative law is that, to be valid, administrative
rules and regulations must be issued by authority of a law and must not
contravene the provisions of the Constitution. The rule-making power of an
administrative agency may not be used to abridge the authority given to it by
Congress or by the Constitution. Nor can it be used to enlarge the power of the
administrative agency beyond the scope intended. Constitutional and statutory
provisions control with respect to what rules and regulations may be
promulgated by administrative agencies and the scope of their regulations In the
case at bar, we find that 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 Adm. Order #7 (2008)
raising of livestock, swine and poultry is different from crop or tree farming. It is
an industrial, not an agricultural, activity.
DAR v. SUTTON :
Land devoted to cow & calf breeding. Lands under VOS before CARP.
After CARP & Luz Farms case, Sutton filed withdrawal of VOS. DAR issued A.O #9
(1993) which provide that only portions of land used for raising of livestock,
poultry & swine shall be excluded. DAR partially exempted portion but ordered
acquisition the rest.
SC: AO is invalid as it contravene Constitution since livestock , swine/poultry
raising do not fall under agriculture & agricultural activity
DAR Adm. Order No. 7-2008
Policy Guidelines:
1. Private agricultural lands or portions therof actually, directly or exclusively
used for livestock purposes other than agricultural like cattle raising as of june
15, 1988 and continuously and exclusively utilized or devoted for such purpose
up until the time of inventory shall be excluded from CARP coverage.
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
2. Conversely, landholdings or any portions thereof not actually, directly and
exclusively used for livestock raising are subject to CARP coverage if one or
more of the following conditions apply:
2.1 if there is agricultural activity in the area, i.e cultivation of the soil, planting
of crops, growing of fruit trees, including the harvesting of such products, and
other farm activities and practices, whether done by a natural or juridical person
and regardless of the final use or destination of such agricultural products
2.2 the land is suitable for agriculture and it is presently occupied and tilled by
farmer/s.
5. in case of any of the conditions under items 2.1 and 2.2 are evident, the PARO
shall immediately proceed with the issuance of NOTICE of COVERAGE on the
subject landholding or portions thereof
8. any act of the landowner to change or convert his agricultural land for
livestock raising shall not affect the coverage of his landholdings under CARP.
Any diversification or change in the agricultural use of the landholdings, or shift
from crop production to livestock raising shall be subject to the existing
guidelines on land use conversion.
(Guidelines per Sutton Case (livestock raising)
Lands ADE used for livestock like cattle raising as of 15 June 1988 &
continuously devoted shall be excluded.
Those not ADE are subject to CARP provided that the agricultural activity
in land is suitable for agriculture presently tilled by farmers
Chapter III (IMPROVEMENT OF TENURIAL & LABOR RELATION)
WHAT ARE THE WAYS IN DISTRIBUTING LANDS TO QUALIFIED FARMERS?
1. Compulsory acquisition (Sec.16)
2. Voluntary offer to sell/voluntary land transfer (Sec.20)
3. Non-land transfer schemer stock distribution option(SDO);
production & profit sharing (PPS)- Sec. 13/32; leasehold
operation(Sec.12)
DAR Adm. Order No. 2-06
RA 6389 automatically converted share tenancy throughout the country into
agricultural leasehold relationship
Page 38
1. abolition of share tenancy now covers all agricultural landholdings without
exceptions
2. the conversion of share tenancy into leasehold is mandated by law.
3. All share-crop tenants were automatically converted into agricultural lessees
as of june 15, 1988 whether or not a leasehold agreement has been executed
4. Leaseholders security of tenure shall be respected and guaranteed.
RA 6657 mandates Dar to determine the fix rentals within retained areas and
areas not yet acquired for agrarian reform
- Farmer has a right to elect whether to become a farmer beneficiary or a
leaseholder in the retention are of the landholder.
Agricultural leasehold shall be based on tenancy relationship. Essential elements
of agricultural tenancy:
1.1 the parties are the landholder and the tenant
1.2 the object of the relationship is an agricultural land
1.3 the consent freely given either orally or in writing, express or implied
1.4 the purpose of the relationship is agricultural production
1.5 there is personal cultivation
1.6 there is consideration given to the lessor either in a form of share of the
harvest or payment of fixed amount in money or produce to or both.
Agricultural leasehold relation shall not be extinguished by mere expiration of
the term of period in a leasehold contract nor by the sale, alienation or transfer
of the legal possession of the land.
Sec.12 of 6657 mandates DAR to determine & fix the lease rentals within the
retained areas and areas not yet acquired.
Sec. 6 of 6657 recognizes the right of farmer to elect whether farmer-beneficiary
OR leaseholds in retained area.
Sec.67 of 6657 directs RD to register patents, title & documents required for
implementation of CARP
Pursuant to DARs mandate to protect the rights & improve tenurial &
economic status of farmers in tenanted lands, DAR issued AO 02-
06(REVISED RULES & PROCEDURES GOVERNING LEASEHOLD
IMPLEMENTATION IN TENANTED AGRICULTURAL LANDS):
-Leasehold is based on tenancy relationship (repeat 6 requisites)
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
-Leasehold relation shall not be extinguished by expiration at term nor
by sale. In case of alienation, purchaser/transferee shall be subjugated
to rights/obligation of lessor.
-DARAB has jurisdiction to cancel leasehold contract .
-The consideration of lease shall not be more than 25% of average
normal harvest during 3 agri years
-AO 02-06 states, among others, the rights & obligations of lessor/lessee.
CHAPTER IV REGISTRATION
Sec. 14 & 15 require the registration of landowners & beneficiaries w/
DAR. Purpose is to establish databank & identify actual famer-
beneficiaries.
Fortich, et al. vs. Corona, et al., G.R. 131457, August 19, 1999
This case involves a 144-hectare land located at San Vicente, Sumilao, Bukidnon,
owned by the Norberto Quisumbing, Sr. Management and Development Corporation
(NQSRMDC), one of the petitioners. The property is covered by a Transfer Certificate of
Title No. 14371 3 of the Registry of Deeds of the Province of Bukidnon.
In 1984, the land was leased as a pineapple plantation to the Philippine Packing
Corporation, now Del Monte Philippines, Inc. (DMPI), a multinational corporation, for a
period of ten (10) years under the Crop Producer and Grower's Agreement duly annotated
in the certificate of title. The lease expired in April, 1994.
In October, 1991, during the existence of the lease, the Department of Agrarian
Reform (DAR) placed the entire 144-hectare property under compulsory acquisition and
assessed the land value at P2.38 million. 4
NQSRMDC resisted the DAR's action. In February, 1992, it sought and was
granted by the DAR Adjudication Board (DARAB), through its Provincial Agrarian Reform
Adjudicator (PARAD) in DARAB Case No. X-576, a writ of prohibition with preliminary
injunction which ordered the DAR Region X Director, the Provincial Agrarian Reform Officer
(PARO) of Bukidnon, the Municipal Agrarian Reform Office (MARO) of Sumilao, Bukidnon,
the Land Bank of the Philippines (Land Bank), and their authorized representatives "to
desist from pursuing any activity or activities" concerning the subject land "until further
orders." 5
On November 7, 1997, the Office of the President resolved the strikers' protest by
issuing the so-called "Win/Win" Resolution penned by then Deputy Executive Secretary
Renato C. Corona
Page 39
 In seeking the nullification of the "Win-Win" Resolution, the petitioners claim that
the Office of the President was prompted to issue the said resolution "after a very well-
managed hunger strike led by fake farmer-beneficiary Linda Ligmon succeeded in
pressuring and/or politically blackmailing the Office of the President to come up with this
purely political decision to appease the 'farmers,' by reviving and modifying the Decision of
29 March 1996 which has been declared final and executory in an Order of 23 June 1997.
Now to the main issue of whether the final and executory Decision dated March
29, 1996 can still be substantially modified by the "Win-Win" Resolution.
We rule in the negative.
The rules and regulations governing appeals to the Office of the President of the
Philippines are embodied in Administrative Order No. 18. Section 7 thereof provides:
Sec. 7. Decisions/resolutions/orders of the Office of the President shall,
except as otherwise provided for by special laws, become final after the
lapse of fifteen (15) days from receipt of a copy thereof by the parties,
unless a motion for reconsideration thereof is filed within such period.
Only one motion for reconsideration by any one party shall be allowed
and entertained, save in exceptionally meritorious cases. (Emphasis
ours).
It is further provided for in Section 9 that "The Rules of Court shall apply in a
suppletory character whenever practicable.
When the Office of the President issued the Order dated June 23, 1997 declaring the
Decision of March 29, 1996 final and executory, as no one has seasonably filed a motion for
reconsideration thereto, the said Office had lost its jurisdiction to re-open the case, more so
modify its Decision. Having lost its jurisdiction, the Office of the President has no more
authority to entertain the second motion for reconsideration filed by respondent DAR
Secretary, which second motion became the basis of the assailed "Win-Win" Resolution.
Section 7 of Administrative Order No. 18 and Section 4, Rule 43 of the Revised Rules of
Court mandate that only one (1) motion for reconsideration is allowed to be taken from the
Decision of March 29, 1996. And even if a second motion for reconsideration was permitted
to be filed in "exceptionally meritorious cases," as provided in the second paragraph of
Section 7 of AO 18, still the said motion should not have been entertained considering that
the first motion for reconsideration was not seasonably filed, thereby allowing the Decision
of March 29, 1996 to lapse into finality. Thus, the act of the Office of the President in re-
opening the case and substantially modifying its March 29, 1996 Decision which had
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
already become final and executory, was in gross disregard of the rules and basic legal
precept that accord finality to administrative determinations.
Fortich vs. Corona : intervenors claimed that they are farmworkers & so
intervened in case.
SC: There is no ruling yet from DAR whether intervenors are beneficiaries, so
they have no standing yet to intervene in the case.
DAR safeguards the list of ARB & provide IDs as proof of being bonafide
beneficiaries
DARAB has jurisdiction to disqualify an ARB.
CHAPTER V LAND ACQUISITION
Landlessness is acknowledged as the core problem in the rural areas
and the root cause of peasant unrest.
In order to hasten the implementation of the program, the Department
of Agrarian Reform has made compulsory acquisition the priority mode
of land acquisition. To the same end, the law provides for the steps in
acquiring private lands through administrative instead of judicial
proceedings. This procedure is allowed provided the requirements of due
process as to notice and hearing are complied with.
Compulsory acquisition may be defined as the mandatory acquisition
of agricultural lands including facilities and improvements necessary for
agricultural production, as may be appropriate, for distribution to
qualified beneficiaries upon payment of just compensation.
The Notice of Coverage (NOC) commences the compulsory acquisition of
private agricultural lands coverable under the Comprehensive Agrarian
Reform Program (CARP). Along the various phases of the CARP
proceedings, the process stalls because of Land Owner (LO) resistance,
most of whom invoke the ground of lack of notice or non-observance of
due process in attacking the proceedings.
LAND ACQUISITION
SEC. 16. Procedure for Acquisition of Private Lands.- For purposes of acquisition
of private lands, the following procedures shall be followed:
Page 40
(a) After having identified the land, the landowners and the beneficiaries, the
DAR shall send its notice to acquire the land to the owners thereof, by personal
delivery or registered mail, and post the same in a conspicuous place in the
municipal building and barangay hall of the place where the property is located.
Said notice shall contain the offer of the DAR to pay a corresponding value in
accordance with the valuation set forth in Sections 17, 18, and other pertinent
provisions hereof.
(b) Within thirty (30) days from the date of receipt of written notice by personal
delivery or registered mail, the landowner, his administrator or representative
shall inform the DAR of his acceptance or rejection of the offer.
(c) If the landowner accepts the offer of the DAR, the LBP shall pay the
landowner the purchase price of the land within thirty (30) days after he
executes and delivers a deed of transfer in favor of the Government and
surrenders the Certificate of Title and other muniments of title.
(d) In case of rejection or failure to reply, the DAR shall conduct summary
administrative proceedings to determine the compensation of the land by
requiring the landowner, the LBP and other interested parties to summit
evidence as to the just compensation for the land, within fifteen (15) days from
the receipt of the notice. After the expiration of the above period, the matter is
deemed submitted for decision. The DAR shall decide the case within thirty (30)
days after it is submitted for decision.
(e) Upon receipt by the landowner of the corresponding payment or in case of
rejection or no response from the landowner, upon the deposit with an
accessible bank designated by the DAR of the compensation in cash or LBP
bonds in accordance with this Act, the DAR shall take immediate possession of
the land and shall request the proper Register of Deeds to issue a Transfer
Certificate of Title (TCT) in the name of the Republic of the Philippines. The DAR
shall thereafter proceed with the redistribution of the land to the qualified
beneficiaries.
(f) Any party who disagrees with the decision may bring the matter to the court
of proper jurisdiction for final determination of just compensation.
Sec. 16 outlines the procedure for acquisition of private land
Take note of Sec.16(d) & (e):
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
(1) practice of having no deed of transfer or conveyance
(2) titles are cancelled w/o owners copy surrendered (in Torren's
System, if there is refusal in involuntary dealings remedy is file petition
in court
(3) RD titles are cancelled while owners copy is subsisting
Sec. 66 (Exemptions from taxes &fees of land transfer)
Sec. 67 (Free Registration of patents, titles & documents required for
implementation of CARP)
Sec. (e) : Once DAR request and LBP makes deposit of initial valuation, DAR can
request RD to cancel title & transfer it to Republic of Phil. So even if landowners
protests valuation, distribution of land will proceed. CLOAs are issued upon land
acquisition: so cancellation of title of landowner can simultaneously go w/
issuance of CLOA.
In Association of small land owners, SC did not say automatically. SC
said that title and ownership remain w/ LO until full payment of past
conversation.
CONFED vs. DAR
Facts:
Petitioners CONFED, NFSP, UNIFED and PANAYFED claim that their members own
or administer private agricultural lands devoted to sugarcane. They and their
predecessors-in-interest have been planting sugarcane on their lands allegedly
since time immemorial. While their petition is denominated as one for
prohibition and mandamus, the petitioners likewise seek to nullify paragraphs
(d), (e) and (f) of Section 16 5 of Republic Act No. (RA) 6657, otherwise known as
the Comprehensive Agrarian Reform Law. In other words, their arguments, which
will be discussed shortly, are anchored on the proposition that these provisions
are unconstitutional.
They allege the following grounds in support of their petition:
It is the principal contention of the petitioners that, in the exercise by the State
of the power of eminent domain, which in the case of RA 6657 is the acquisition
of private lands for distribution to farmer-beneficiaries, expropriation
proceedings, as prescribed in Rule 67 of the Rules of Court, must be strictly
complied with. The petitioners rely on the case of Visayas Refining Company v.
Camus and Paredes 7 decided by the Court in 1919. In the said case, the
Page 41
Government of the Philippine Islands, through the Governor-General, instructed
the Attorney-General to initiate condemnation proceedings for the purpose of
expropriating a tract of land containing an area of 1,100,463 square meters to
be used for military and aviation purposes. In compliance therewith, the
Attorney-General filed a complaint with the Court of First Instance (CFI) and
among the defendants impleaded was Visayan Refining Co. which owned a
portion of the property intended to be expropriated. The CFI provisionally fixed
the total value of the subject property at P600,000 and upon payment thereof as
deposit, the CFI authorized that the Government be placed in possession
thereof.
Paragraph (e) is assailed by the petitioners as it authorizes the DAR, by allegedly
merely causing the deposit with the Land Bank of the compensation, to
immediately take possession of the property and to direct the Register of Deeds
to cancel the certificate of title of the landowner without notice to and consent of
the latter. The petitioners contend that, in contrast, under the Civil Code, if the
creditor or obligee refuses to accept the tender of payment, it is the duty of the
debtor or obligor to make consignation of the thing or amount due. Under the
Civil Code, there is no effective payment without valid tender of payment and
consignation in court. 15 The petitioners theorize that, in the same manner, the
DAR cannot be allowed to take possession of the property of a landowner, by
mere deposit of the compensation that it has summarily fixed under paragraph
(e), without having to go to court.
Paragraph (f) is characterized by the petitioners as meaningless and useless to
the landowner. It allegedly compels him to file a case, and in the process incur
costs therefor, for the final determination of just compensation when, in the
meantime, he has already been deprived of possession of his property and his
certificate of title cancelled.
The Respondents' Counter-Arguments
The Land Bank urges the Court to dismiss the petition since the constitutionality
of RA 6657 had already been categorically upheld by the Court in Association of
Small Landowners. Further, some of the grounds relied upon by the petitioners
allege matters that require factual determination. For example, the allegation
that the DAR is subjecting the sugar lands to the coverage of RA 6657 without
first ascertaining whether there are regular farmworkers therein and whether
they are interested to own, directly or collectively, the land they till, allegedly
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
requires factual determination. Considering that the Court is not a trier of facts,
the Land Bank argues that these matters are better threshed out in a trial court.
HELD:
DAR's compulsory acquisition procedure is based on Section 16 of RA 6657. It
does not, in any way, preclude judicial determination of just compensation
Contrary to the petitioners' submission that the compulsory acquisition
procedure adopted by the DAR is without legal basis, it is actually based on
Section 16 of RA 6657. Under the said law, there are two modes of acquisition of
private agricultural lands: compulsory and voluntary. The procedure for
compulsory acquisition is that prescribed under Section 16 of RA 6657. TCDcSE
In Roxas & Co., Inc. v. Court of Appeals, 41 the Court painstakingly outlined the
procedure for compulsory acquisition, including the administrative orders issued
by the DAR in relation thereto, in this manner:
In the compulsory acquisition of private lands, the landholding, the landowners
and the farmer beneficiaries must first be identified. After identification, the DAR
shall send a Notice of Acquisition to the landowner, by personal delivery or
registered mail, and post it in a conspicuous place in the municipal building and
barangay hall of the place where the property is located. Within thirty days from
receipt of the Notice of Acquisition, the landowner, his administrator or
representative shall inform the DAR of his acceptance or rejection of the offer. If
the landowner accepts, he executes and delivers a deed of transfer in favor of
the government and surrenders the certificate of title. Within thirty days from
the execution of the deed of transfer, the Land Bank of the Philippines (LBP)
pays the owner the purchase price. If the landowner rejects the DAR's offer or
fails to make a reply, the DAR conducts summary administrative proceedings to
determine just compensation for the land. The landowner, the LBP
representative and other interested parties may submit evidence on just
compensation within fifteen days from notice. Within thirty days from
submission, the DAR shall decide the case and inform the owner of its decision
and the amount of just compensation. Upon receipt by the owner of the
corresponding payment, or, in case of rejection or lack of response from the
latter, the DAR shall deposit the compensation in cash or in LBP bonds with an
accessible bank. The DAR shall immediately take possession of the land and
cause the issuance of a transfer certificate of title in the name of the Republic of
the Philippines. The land shall then be redistributed to the farmer beneficiaries.
Page 42
Any party may question the decision of the DAR in the regular courts for final
determination of just compensation.
The DAR has made compulsory acquisition the priority mode of land acquisition
to hasten the implementation of the Comprehensive Agrarian Reform Program
(CARP). Under Section 16 of the CARL, the first step in compulsory acquisition is
the identification of the land, the landowners and the beneficiaries. However, the
law is silent on how the identification process must be made. To fill in this gap,
the DAR issued on July 26, 1989 Administrative Order No. 12, Series of 1989,
which set the operating procedure in the identification of such lands. The
procedure is as follows:
"II.OPERATING PROCEDURE
A.The Municipal Agrarian Reform Officer, with the assistance of the pertinent
Barangay Agrarian Reform Committee (BARC), shall: EDATSI
1.Update the master list of all agricultural lands covered under the CARP in his
area of responsibility. The master list shall include such information as required
under the attached CARP Master List Form which shall include the name of the
landowner, landholding area, TCT/OCT number, and tax declaration number.
2.Prepare a Compulsory Acquisition Case Folder (CACF) for each title (OCT/TCT)
or landholding covered under Phase I and II of the CARP except those for which
the landowners have already filed applications to avail of other modes of land
acquisition. A case folder shall contain the following duly accomplished forms:
a)CARP CA Form 1 MARO Investigation Report
b)CARP CA Form 2 Summary Investigation Report of Findings and Evaluation
c)CARP CA Form 3 Applicant's Information Sheet
d)CARP CA Form 4 Beneficiaries Undertaking
e)CARP CA Form 5 Transmittal Report to the PARO
The MARO/BARC shall certify that all information contained in the above-
mentioned forms have been examined and verified by him and that the same
are true and correct. IEHTaA
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
3.Send a Notice of Coverage and a letter of invitation to a conference/meeting to
the landowner covered by the Compulsory Case Acquisition Folder. Invitations to
the said conference/meeting shall also be sent to the prospective farmer-
beneficiaries, the BARC representative(s), the Land Bank of the Philippines (LBP)
representative and other interested parties to discuss the inputs to the valuation
of the property. He shall discuss the MARO/BARC investigation report and solicit
the views, objection, agreements or suggestions of the participants thereon. The
landowner shall also be asked to indicate his retention area. The minutes of the
meeting shall be signed by all participants in the conference and shall form an
integral part of the CACF.
4.Submit all completed case folders to the Provincial Agrarian Reform Officer
(PARO).
B.The PARO shall:
1.Ensure that the individual case folders are forwarded to him by his MAROs.
2.Immediately upon receipt of a case folder, compute the valuation of the land
in accordance with A.O. No. 6, Series of 1988. The valuation worksheet and the
related CACF valuation forms shall be duly certified correct by the PARO and all
the personnel who participated in the accomplishment of these forms. TCASIH
3.In all cases, the PARO may validate the report of the MARO through ocular
inspection and verification of the property. This ocular inspection and verification
shall be mandatory when the computed value exceeds 500,000 per estate.
4.Upon determination of the valuation, forward the case folder, together with the
duly accomplished valuation forms and his recommendations, to the Central
Office. The LBP representative and the MARO concerned shall be furnished a
copy each of his report.
C.DAR Central Office, specifically through the Bureau of Land Acquisition and
Distribution (BLAD), shall: ECTHIA
1.Within three days from receipt of the case folder from the PARO, review,
evaluate and determine the final land valuation of the property covered by the
case folder. A summary review and evaluation report shall be prepared and duly
Page 43
certified by the BLAD Director and the personnel directly participating in the
review and final valuation.
2.Prepare, for the signature of the Secretary or her duly authorized
representative, a Notice of Acquisition (CARP CA Form 8) for the subject
property. Serve the Notice to the landowner personally or through registered
mail within three days from its approval. The Notice shall include, among others,
the area subject of compulsory acquisition, and the amount of just compensation
offered by DAR.
3.Should the landowner accept the DAR's offered value, the BLAD shall prepare
and submit to the Secretary for approval the Order of Acquisition. However, in
case of rejection or non-reply, the DAR Adjudication Board (DARAB) shall
conduct a summary administrative hearing to determine just compensation, in
accordance with the procedures provided under Administrative Order No. 13,
Series of 1989. Immediately upon receipt of the DARAB's decision on just
compensation, the BLAD shall prepare and submit to the Secretary for approval
the required Order of Acquisition.
4.Upon the landowner's receipt of payment, in case of acceptance, or upon
deposit of payment in the designated bank, in case of rejection or non-response,
the Secretary shall immediately direct the pertinent Register of Deeds to issue
the corresponding Transfer Certificate of Title (TCT) in the name of the Republic
of the Philippines. Once the property is transferred, the DAR, through the PARO,
shall take possession of the land for redistribution to qualified beneficiaries."
AEDCHc
CONFED vs. DAR
Compulsory Acquisition
Notice of Acquisition
First step: identification of the land, the landowners and the
beneficiaries.
Law is silent
Administrative Order No. 12, Series of 1989
Valid implementation , two notices
DAR A.O. No.12, Series of 1989, amended in 1990 by DAR A.O. No.9,
Series of 1990 and in 1993 by DAR A.O No.1, Series of 1993
LBP vs Trinidad
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
Facts:
Private respondent is the registered owner of a parcel of agricultural land
situated in Sampao, Kapalong, Davao del Norte with an approximate area of
37.1010 hectares covered by Transfer Certificate of Title No. T-49200, 14.999
hectares of which was covered by RA No. 6657 through the Voluntary Offer to
Sell (VOS) scheme of the Comprehensive Agrarian Reform Program (CARP).
Private respondent offered to the Department of Agrarian Reform (DAR) the
price of P2,000,000.00 per hectare for said portion of the land covered by CARP.
Petitioner Land Bank of the Philippines (LBP) valued and offered as just
compensation for said 14.999 hectares the amount of P1,145,806.06 or
P76,387.57 per hectare. The offer was rejected by private respondent.
In accordance with Section 16 of RA No. 6657, petitioner LBP deposited for the
account of private respondent P1,145,806.06 in cash and in bonds as provisional
compensation for the acquisition of the property.
Thereafter, the DAR Adjudication Board (DARAB), through the Regional
Adjudicator (RARAD) for Region XI conducted summary administrative
proceedings under DARAB Case No. LV-XI-0330-DN-2002 to fix the just
compensation.
On June 26, 2002, the DARAB rendered a decision fixing the compensation of the
property at P10,294,721.00 or P686,319.36 per hectare.
Petitioner LBP filed a motion for reconsideration of the above decision but the
same was denied on September 4, 2002.
Petitioner LBP filed a petition against private respondent for judicial
determination of just compensation before the Special Agrarian Court, Regional
Trial Court, Branch 2, Tagum City, docketed as DAR Case No. 78-2002, which is
the subject of this petition.
Private respondent, on the other hand, filed a similar petition against DAR before
the same Special Agrarian Court docketed as DAR Case No. 79-2002, to which
petitioner LBP filed its answer and moved for the dismissal of the petition for
being filed out of time.
Page 44
Private respondent filed a Motion for Delivery of the Initial Valuation praying that
petitioner LBP be ordered to deposit the DARAB determined amount of
P10,294,721.00 in accordance with the Supreme Court ruling in "Land Bank of
the Philippines vs. Court of Appeals, Pedro L. Yap, Et Al., G.R. No. 118712,
October 6, 1995". EAIcCS
Petitioner LBP filed a Manifestation praying that the amount of the deposit
should only be the initial valuation of the DAR/LBP in the amount of
P1,145,806.06 and not P10,294,721.00 as determined by the DARAB.
On December 12, 2002, public respondent rendered the assailed resolution
ordering petitioner LBP to deposit for release to the private respondent the
DARAB determined just compensation of P10,294,721.00.
On December 13, 2002, petitioner LBP filed a motion for reconsideration of the
said order to deposit.
On December 17, 2002, private respondent filed a motion to cite Romeo
Fernando Y. Cabanal and Atty. Isagani Cembrano, manager of petitioner LBP's
Agrarian Operations Office in Region XI and its handling lawyer, respectively, for
contempt for failure to comply with the order to deposit.
After the filing of private respondent's comment to the motion for
reconsideration and petitioner LBP's explanation and memorandum to the
motion for reconsideration, public respondent rendered the assailed resolution
dated February 17, 2003, denying petitioner LBP's motion for reconsideration.
Petitioner LBP filed a motion to admit a second motion for reconsideration which
still remains unacted upon by public respondent.
ISSUE:
The lone issue in this controversy is the correct amount of provisional
compensation which the LBP is required to deposit in the name of the landowner
if the latter rejects the DAR/LBP's offer. Petitioner maintains it should be its
initial valuation of the land subject of Voluntary Offer to Sell (VOS) while
respondent claims it pertains to the sum awarded by the PARAD/RARAD/DARAB
in a summary administrative proceeding pending final determination by the
courts.
HELD:
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
Section 16 of R.A. No. 6657 reads:
(d)In case of rejection or failure to reply, the DAR shall conduct summary
administrative proceedings to determine the compensation for the land by
requiring the landowner, the LBP and other interested parties to submit evidence
as to the just compensation for the land, within fifteen (15) days from the receipt
of the notice. After the expiration of the above period, the matter is deemed
submitted for decision. The DAR shall decide the case within thirty (30) days
after it is submitted for decision.
(e)Upon receipt by the landowner of the corresponding payment or in case of
rejection or no response from the landowner, upon the deposit with an
accessible bank designated by the DAR of the compensation in cash or in LBP
bonds in accordance with this Act, the DAR shall take immediate possession of
the land and shall request the proper Register of Deeds to issue a Transfer
Certificate of Title (TCT) in the name of the Republic of the Philippines. The DAR
shall thereafter proceed with the redistribution of the land to the qualified
beneficiaries.
We find the foregoing as a strained interpretation of a simple and clear enough
provision on the procedure governing acquisition of lands under CARP, whether
under the compulsory acquisition or VOS scheme. Indeed, it would make no
sense to mention anything about the provisional deposit in sub-paragraphs (a)
and (b) the landowner is sent a notice of valuation to which he should reply
within a specified time, and in sub-paragraph (c) when the landowner accepts
the offer of the DAR/LBP as compensation for his land. Sub-paragraph (d)
provides for the consequence of the landowner's rejection of the initial valuation
of his land, that is, the conduct of a summary administrative proceeding for a
preliminary determination by the DARAB through the PARAD or RARAD, during
which the LBP, landowner and other interested parties are required to submit
evidence to aid the DARAB/RARAD/PARAD in the valuation of the subject land.
Sub-paragraph (e), on the other hand, states the precondition for the State's
taking of possession of the landowner's property and the cancellation of the
landowner's title, thus paving the way for the eventual redistribution of the land
to qualified beneficiaries: payment of the compensation (if the landowner
already accepts the offer of the DAR/LBP) or deposit of the provisional
compensation (if the landowner rejects or fails to respond to the offer of the
DAR/LBP). Indeed, the CARP Law conditions the transfer of possession and
ownership of the land to the government on receipt by the landowner of the
Page 45
corresponding payment or the deposit of the compensation in cash or LBP bonds
with an accessible bank.
LBP vs Pagayatan
Facts:
On October 21, 1972, the 3,682.0286-hectare Suntay Estate, consisting of
irrigated/unirrigated rice and corn lands covered by Transfer Certificate of Title
No. T-31(1326) located in the Barangays of Gen. Emilio Aguinaldo, Sta. Lucia,
and San Nicolas in Sablayan, Occidental Mindoro, was subjected to the operation
of Presidential Decree No. 27, under its Operation Land Transfer (OLT), with the
farmer-beneficiaries declared as owners of the property. However, a 300-hectare
portion of the land was subjected to the Comprehensive Agrarian Reform
Program (CARP) instead of the OLT. Thus, Certificates of Landownership Award
were issued to the farmer-beneficiaries in possession of the land. 5 Such
application of the CARP to the 300-hectare land was later the subject of a case
before the Department of Agrarian Reform Adjudicatory Board (DARAB), which
ruled that the subject land should have been the subject of OLT instead of CARP.
The landowner admitted before the PARAD that said case was pending with this
Court and docketed as G.R. No. 108920, entitled Federico Suntay v. Court of
Appeals.
Meanwhile, the owner of the land remained unpaid for the property. Thus,
Josefina S. Lubrica, in her capacity as assignee of the owner of the property,
Federico Suntay, filed a Petition for Summary Determination of Just
Compensation with the PARAD, docketed as Case No. DCN-0405-0022-2002.
Thereafter, the PARAD issued its Decision dated March 21, 2003, the dispositive
portion of which reads: ECSHID
WHEREFORE, judgment is hereby rendered:
1.Fixing the preliminary just compensation for 431.1407 hectare property at
P166,150.00 per hectare or a total of P71,634,027.30.
2.Directing the Land Bank of the Philippines to immediately pay the aforestated
amount to the Petitioner.
3.Directing the DAR to immediately comply with all applicable requirements so
that the subject property may be formally distributed and turned over to the
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
farmer beneficiaries thereof, in accordance with the Decision of the DARAB
Central in DARAB Case No. 2846.
The LBP then filed a Petition dated March 4, 2004 with the RTC docketed as
Agrarian Case No. 1390, appealing the PARAD Decision. In the Petition, the LBP
argued that because G.R. No. 108920 was pending with this Court in relation to
the 300-hectare land subject of the instant case, the Petition for Summary
Determination of Just Compensation filed before the PARAD was premature. The
LBP argued further that the PARAD could only make an award of up to PhP5
million only. The PARAD, therefore, could not award an amount of
PhP71,634,027.30. The LBP also contended that it could not satisfy the demand
for payment of Lubrica, considering that the documents necessary for it to
undertake a preliminary valuation of the property were still with the Department
of Agrarian Reform (DAR).
ISSUE:
What is the proper amount to be deposited under Section 16 of Republic Act No.
6657? Is it the PARAD/DARAB determined valuation or the preliminary valuation
as determined by the DAR/LBP?
HELD:
The LBP posits that under Sec. 16 (e) of RA 6657, and as espoused in Land Bank
of the Philippines v. Court of Appeals, 18 it is the purchase price offered by the
DAR in its notice of acquisition of the land that must be deposited in an
accessible bank in the name of the landowner before taking possession of the
land, not the valuation of the PARAD.
The Court agrees with the LBP.
Conspicuously, there is no mention of the PARAD in the foregoing Sec. 16 (e)
when it speaks of "the deposit with an accessible bank designated by the DAR of
the compensation in cash or LBP bonds in accordance with this Act." Moreover, it
is only after the DAR has made its final determination of the initial valuation of
the land that the landowner may resort to the judicial determination of the just
compensation for the land. Clearly, therefore, it is the initial valuation made by
the DAR and LBP that is contained in the letter-offer to the landowner under Sec.
16 (a), said valuation of which must be deposited and released to the landowner
prior to taking possession of the property.
Page 46
It is clear from Sec. 16 of RA 6657 that it is the initial valuation made by the DAR
and the LBP that must be released to the landowner in order for DAR to take
possession of the property. Otherwise stated, Sec. 16 of RA 6657 does not
authorize the release of the PARAD's determination of just compensation for the
land which has not yet become final and executory.
Compensation in cash or in LBP bonds (Section 16)
Land Bank v. CA
Private respondent challenged the admin order issued by DAR
permitting the opening of trust account by LBP, in lieu of depositing in
cash or in LBP bonds.
SC:
Sec. 16 (e) is explicit that deposit be in cash or in LBP bonds;
Nowhere does it appear nor can it be inferred that the deposit can be
made in any other form like a trust account;
There was no basis for issuance of order.
Land Bank v. CA
Facts
Private respondents are landowners whose landholdings were acquired by the
DAR and subjected to transfer schemes to qualified beneficiaries under the
Comprehensive Agrarian Reform Law (CARL, Republic Act No. 6657). Aggrieved
by the alleged lapses of the DAR and the Landbank with respect to the valuation
and payment of compensation for their land pursuant to the provisions of RA
6657, private respondents filed with this Court a Petition for Certiorari and
Mandamus with prayer for preliminary mandatory injunction. Private
respondents questioned the validity of DAR Administrative Order No. 6, Series of
1992 6 and DAR Administrative Order No. 9, Series of 1990, 7 and sought to
compel the DAR to expedite the pending summary administrative proceedings to
finally determine the just compensation of their properties, and the Landbank to
deposit in cash and bonds the amounts respectively "earmarked," "reserved"
and "deposited in trust accounts" for private respondents, and to allow them to
withdraw the same.
Private respondents argued that Administrative Order No. 9, Series of 1990 was
issued without jurisdiction and with grave abuse of discretion because it permits
the opening of trust accounts by the Landbank, in lieu of depositing in cash or
bonds in an accessible bank designated by the DAR, the compensation for the
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
land before it is taken and the titles are cancelled as provided under Section
16(e) of RA 6657. 9 Private respondents also assail the fact that the DAR and the
Landbank merely "earmarked," "deposited in trust" or "reserved" the
compensation in their names as landowners despite the clear mandate that
before taking possession of the property, the compensation must be deposited
in cash or in bonds. 10
Petitioner DAR, however, maintained that Administrative Order No. 9 is a valid
exercise of its rule-making power pursuant to Section 49 of RA 6657. 11
Moreover, the DAR maintained that the issuance of the "Certificate of Deposit"
by the Landbank was a substantial compliance with Section 16(e) of RA 6657.
ISSUE:
Whether the opening of trust accounts for payment of just compensation is valid.
HELD:
The contention is untenable. Section 16(e) of RA 6657 provides as follows:
"SECTION 16.Procedure for Acquisition of Private Lands. . . .
(e)Upon receipt by the landowner of the corresponding payment or, in case of
rejection or no response from the landowner, upon the deposit with an
accessible bank designated by the DAR of the compensation in cash or in LBP
bonds in accordance with this Act, the DAR shall take immediate possession of
the land and shall request the proper Register of Deeds to issue a Transfer
Certificate of Title (TCT) in the name of the Republic of the Philippines. . . ."
(Emphasis supplied.)
It is very explicit therefrom that the deposit must be made only in "cash" or 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 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."
LBP vs Honeycomb
Facts:
Page 47
Honeycomb Farms Corporation (Honeycomb Farms) was the registered owner of
two parcels of agricultural land in Cataingan, Masbate.
The Land Bank of the Philippines (LBP), as the agency vested with the
responsibility of determining the land valuation and compensation for parcels of
land acquired pursuant to the CARL, 6 and using the guidelines set forth in DAR
Administrative Order (AO) No. 17, series of 1989, as amended by DAR AO No. 3,
series of 1991, fixed the value of these parcels of land.
When Honeycomb Farms rejected this valuation for being too low, the Voluntary
Offer to Sell was referred to the DAR Adjudication Board, Region V, Legaspi City,
for a summary determination of the market value of the properties.
HELD:
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: CSDcTH
It is very explicit . . . [from Section 16(e)] that the deposit must be made only in
"cash" or 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 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."
xxx xxx xxx
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" or 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.
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
Compulsory acquisition and notice requirements (Section 16)
DLR ADMINISTRATIVE ORDER NO. 04-05
PROCEDURES
1. Commencement
1.1. Commencement by the Provincial Agrarian Reform Officer (PARO)
After determination by the Municipal Agrarian Reform Officer (MARO) of the
agricultural landholdings coverable under CARP in his area of jurisdiction, he
shall submit the list of these agricultural landholdings to the PARO who shall
prepare and send, through the MARO, the NOC (CARP-LA Form No. 7) to the
concerned LO.
1.2. Commencement by a party Any person may commence the
proceedings herein by filing a petition for coverage before the Department of
Land Reform (DLR) Central Office (DLRCO), DLR Regional Office (DLRRO), DLR
Provincial Office (DLRPO) or DLR Municipal Office (DLRMO) of the region/province
or municipality where the subject landholding is located. The DLR office which
received the petition for coverage shall transmit or forward the same to the
PARO of the province where the subject landholding is located. The DLRPO,
through the MARO, shall validate the petition and shall issue the NOC, if
warranted. In the event that the result of the validation/evaluation by the
DLRMO/DLRPO is such that an NOC is not warranted, the DLRPO shall forward its
findings or that of the DLRMO to the DLRRO for evaluation and issuance of an
Order, treating the petition as an Agrarian Law Implementation (ALI) case.
2. Posting of the NOC
The MARO shall post copies of the NOC for at least seven (7) days in the
bulletin boards or any conspicuous places in the municipality/city and the
barangay where the property is located and thereafter issue the corresponding
Certification of Posting Compliance (CARP-LA Form No. 5).
3. By Whom the NOC is served
3.1. Upon receipt of a copy of the NOC and upon instruction by the PARO
(CARP-LA Form No. 8), the MARO where the subject landholding is located or any
Page 48
DLR personnel officially authorized by the PARO shall cause the service of the
NOC to the LO in accordance with these rules.
3.2. If the LO's residence is outside the Philippines or unknown, the MARO of
the place where the subject landholding is located shall submit a report of such
fact or failure to notify the LO through the regular mode of service to the PARO,
and shall request the latter to cause the publication of the NOC in a newspaper
of general circulation.
4. Service of the NOC
4.1. General rule The NOC shall be addressed to and received by the LO.
4.2. Service upon co-owners In case of co-ownership, the NOC shall be
served upon each and every co-owner, unless one is specifically authorized to
receive for the other co-owners. AHEDaI
4.3. Service upon minors or incompetents When the LO is a minor, insane
or otherwise incompetent, service shall be made upon him personally and to his
legal guardian if he has one, or if none, upon his guardian ad litem whose
appointment shall be applied for by the DLR. In the case of a minor, service may
also be made on his father and/or mother.
4.4. Service upon entity without juridical personality When the LOs who are
persons associated in an entity without juridical personality are sued under the
name by which they are generally or commonly known, service may be effected
upon all the LOs by serving upon any one of them, or upon the person in charge
of the Office or place of business maintained in such name. Such service shall
not bind individually any person whose connection with the entity has, upon due
notice, been severed before the proceeding was brought.
4.5. Service upon domestic private juridical entity When the LO is a
corporation, partnership or association organized under the laws of the
Philippines with a juridical personality, service may be made on the president,
managing partner, general manager, corporate secretary, treasurer, in-house
counsel or administrator.
4.6. Service upon LO whose identity or whereabouts is unknown In any
proceeding where the LO is designated as an unknown owner, or the like, or
whenever his whereabouts are unknown and cannot be ascertained by diligent
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
inquiry, service may be effected upon him by publication in a newspaper of
general circulation in such places and for such time as the DLR may order.
4.7. Extraterritorial service When the LO does not reside and is not found
in the Philippines, or when the LO ordinarily resides within the Philippines but is
temporarily out of the country, service may be made by publication in a
newspaper of general circulation in such places and for such time as the DLR
may order.
5. Modes of Service:
5.1. Personal Service This is made by handing a copy of the NOC to the LO
in person, or if the LO refuses to receive and sign the NOC for whatever reason,
by tendering the same to him/her.
5.2. Substituted Service If personal service of the NOC cannot be served
directly to the LO within a reasonable time, service may be made by leaving
copies of the NOC at the LO's:
5.2.1. residence with some person of suitable age and discretion residing
therein; or
5.2.2. office or regular place of business with some competent person in charge
thereof.
5.3. Service by Registered Mail if personal or substituted service is not
practicable, service by registered mail will be made to the last known address of
the LO. The registered mail envelope shall be marked "DELIVER TO ADDRESSEE
ONLY" and "RETURN TO SENDER" if addressee has: MOVED OUT, UNKNOWN
ADDRESS, REFUSED TO ACCEPT OR INSUFFICIENT ADDRESS.
5.4. Service by publication If any of the preceding three (3) modes of
service fails, the NOC will be published once in a newspaper of general
circulation. A "RETURN TO SENDER" stamped on the mailing envelope will serve
as proof that the NOC was not received by the LO. The publication need not
state the entire contents of the NOC but only the following essential particulars:
5.4.1. Complete name/s of the LO/all LOs and last known address, if available;
5.4.2. Address or location of the subject landholding (barangay,
municipality/city, province);
5.4.3. The number of the Original or Transfer Certificate of Title (OCT or TCT) or
latest Tax Declaration (TD) covering the subject landholding;
Page 49
5.4.4. A declaration that the Republic of the Philippines shall cover the subject
landholding under CARP;
5.4.5. A reasonable period of thirty (30) days from publication date within which
the LO must file a response to the NOC, with a warning that failure to do so
within the period shall mean waiver of the right/privilege to: apply for
exemption/exclusion or choose the retention area; nominate child/ren as
preferred beneficiaries or submit evidence for determining just compensation.
6. Proof of Service
6.1 Personal or substituted service The proof of service of the NOC shall
consist of:
6.1.1. Written admission of the LO served, or;
6.1.2. Official Return of the MARO or affidavit of the DLR personnel serving,
stating the following: the date, place and manner of service, the papers, if any,
which have been served with the process and name of the person who received
the same.
6.2 Proof of service by registered mail If service is made by registered
mail, proof may be made by the affidavit of the DLR personnel effecting the mail
and the registry receipt issued by the mailing office. The registry return card
shall be filed immediately upon its receipt by the sender or in lieu thereof the
unclaimed letter marked "RETURN TO SENDER" stamped by then post office
concerned or together with the certified or sworn copy of the notice given by the
postmaster to the addressee.
6.3 Proof of service by publication If the service has been made by
publication, service may be proved by the following: 1) the unclaimed or
returned/unopened envelope referred to in paragraph 5.4 hereof; and 2) an
affidavit of publication by the publisher or authorized official together with a
copy of the newspaper where the NOC appeared.
7. Voluntary appearance The LO's voluntary appearance in the
proceedings shall be equivalent to service of NOC.
8. Notice of Field Investigation
Upon proof of service of the issuance of NOC, the MARO sends to the LO
an invitation letter for the conduct of field investigation (CARP-LA Form No. 10).
Assoc. of Small Landowners:
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
Upheld validity of Sec. 16 RA 6657 (manner of acquisition of private
agricultural lands and ascertainment of just compensation). Section 16(e) of the
CARP Law provides that: Upon receipt by the landowner of the corresponding
payment, or in case of rejection or no response from the landowner, upon the
deposit with an accessible bank designated by the DAR of the compensation in
cash or in LBP bonds in accordance with this Act, the DAR shall take immediate
possession of the land and shall request the proper Register of Deeds to issue a
Transfer Certificate of Title (TCT) in the name of the Republic of the Philippines.
The DAR shall thereafter proceed with the redistribution of the land to the
qualified beneficiaries
Sec. 16, RA 6657
The title of the section states: Procedure for Acquisition of Private
Lands.
Section 6, RA 9700
The title was amended: "SEC. 16. Procedure for Acquisition and
Distribution of Private Lands."
Confed v. DAR
Under Section 16 of the CARL, the first step in compulsory
acquisition is the identification of the land, the landowners and
the beneficiaries. However, the law is silent on how the
identification process must be made.
Identification process in Sec. 16 is silent so DAR filled gap (AO
#12, s. 989)
Roxas case : CLOA was not properly issued, DAR should be given chance to
validate proceedings.
Fortich case: CLOA was illegal & should be cancelled for being in violation of
law.
Notice of Coverage:
Notifies landowner that his property shall be placed under CARP and that
he is entitled to exercise his retention right;
Notifies him that a public hearing shall be conducted where he and
representatives of the concerned sectors of society may attend to
discuss the results of the field investigation, the land valuation and other
pertinent matters.
Also informs the landowner that a field investigation of his landholding
shall be conducted where he and the other representatives may be
present.
Page 50
Notice of Acquisition:
The Notice shall include, among others, the area subject of compulsory
acquisition, and the amount of just compensation offered by DAR.
Should the landowner accept the DAR's offered value, the Bureau of
Land Acquisition and Distribution (BLAD) shall prepare and submit to the
Secretary for approval the Order of Acquisition. However, in case of
rejection or non-reply, the DAR Adjudication Board (DARAB) shall
conduct a summary administrative hearing to determine just
compensation.
Immediately upon receipt of the DARAB's decision on just compensation,
the BLAD shall prepare and submit to the Secretary for approval the
required Order of Acquisition.
Upon the landowner's receipt of payment, in case of acceptance, or
upon deposit of payment in the designated bank, in case of rejection or
non-response, the Secretary shall immediately direct the pertinent
Register of Deeds to issue the corresponding Transfer Certificate of Title
(TCT) in the name of the Republic of the Philippines. Once the property is
transferred, the DAR, through the PARO, shall take possession of the
land for redistribution to qualified beneficiaries.
RA 6657: Revolutionary kind of expropriation
affects all private agricultural lands whenever found and of whatever
kind as long in excess of max retention limits;
intended for the benefit not only of a particular community or of a small
segment of the population but of the entire Filipino nation, from all levels
of our society, from the impoverished farmer to the land-glutted owner;
does not cover only the whole territory of this country but goes beyond
in time to the foreseeable future;
Constitution has ordained this revolution in the farms, calling for "a just
distribution" among the farmers of lands that have heretofore been the
prison of their dreams and deliverance
Despite the revolutionary or non-traditional character of RA 6657,
however, the chief limitations on the exercise of the power of eminent
domain, namely: (1) public use; and (2) payment of just compensation,
are embodied therein as well as in the Constitution.
With respect to "public use, in Association of Small Landowners
declared that the requirement of public use had already been settled by
the Constitution itself as it "calls for agrarian reform, which is the
reason why private agricultural lands are to be taken from their owners,
subject to the prescribed maximum retention limits.
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
On just compensation, judicial determination is expressly prescribed in
Section 57 of RA 6657 as it vests on the Special Agrarian Courts original
and exclusive jurisdiction over all petitions for the determination of just
compensation to landowners. It bears stressing that the determination of
just compensation during the compulsory acquisition proceedings of
Section 16 of RA 6657 is preliminary only, court can review.
Section 16 (f) clearly provides:
(f)Any party who disagrees with the decision may bring the matter to
the court of proper jurisdiction for final determination of just compensation
Application of Rule 67 of the Rules of Court?
Rules of Court, including Rule 67 thereof, is not completely disregarded
in the implementation of RA 6657 since the Special Agrarian Courts, in
resolving petitions for the determination of just compensation, are
enjoined to apply the pertinent provisions of the Rules of Court.
Section 58 of RA 6657, like Rule 67 of the Rules of Court, provides for
the appointment of commissioners by the Special Agrarian Courts.
Sec. 58: may; motu proprio or instance of party
Rule 67: shall
Santos v. LBP :
Facts:
RTC required payment of compensation for petitioner's land taken
under the Comprehensive Agrarian Reform Program, to be made in cash and
bonds. According to petitioner, said order illegally amended the judgment
rendered which directs payment of compensation to be made "in the manner
provided in RA 6657.
SC:
Trial court decision directing payment of just compensation in the
manner provided by RA 6657 is not illegally amended but is merely clarified by
an order issued during execution proc that such amount shall be paid in cash
and bonds.
Heirs of Deleste vs LBP
HELD:
On the violation of petitioners' right to due process of law
Page 51
Petitioners contend that DAR failed to notify them that it is subjecting the
subject property under the coverage of the agrarian reform program; hence,
their right to due process of law was violated.
We agree with petitioners. The importance of an actual notice in subjecting a
property under the agrarian reform program cannot be underrated, as non-
compliance with it trods roughshod with the essential requirements of
administrative due process of law.
It was incumbent upon the DAR to notify Deleste, being the landowner of the
subject property. It should be noted that the deed of sale executed by Hilaria in
favor of Deleste was registered on March 2, 1954, and such registration serves
as a constructive notice to the whole world that the subject property was already
owned by Deleste by virtue of the said deed of sale. In Naval v. CA, this Court
held:
Applying the law, we held in Bautista v. Fule that the registration of an
instrument involving unregistered land in the Registry of Deeds creates
constructive notice and binds third person who may subsequently deal with the
same property.
It bears stressing that the principal purpose of registration is "to notify other
persons not parties to a contract that a transaction involving the property has
been entered into." 64 There was, therefore, no reason for DAR to feign
ignorance of the transfer of ownership over the subject property.
Moreover, that DAR should have sent the notice to Deleste, and not to the
Nanamans, is bolstered by the fact that the tax declaration in the name of
Virgilio was already canceled and a new one issued in the name of Deleste.
Although tax declarations or realty tax payments of property are not conclusive
evidence of ownership, they are nonetheless "good indicia of possession in the
concept of an owner, for no one in his right mind would be paying taxes for a
property that is not in his actual or, at least, constructive possession."
Petitioners' right to due process of law was, indeed, violated when the DAR failed
to notify them that it is subjecting the subject property under the coverage of
the agrarian reform program.
CHAPTER VI COMPENSATION
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
Just Compensation:
full & fair equivalent of property taken from owner by expropriation
(Assoc. of Small Landowners). The word "just" is used to intensify the
meaning of the word "compensation" to convey the idea that the
equivalent to be rendered for the property to be taken shall be real,
substantial, full, ample.
Sec. 7, RA 9700:
"SEC. 17. Determination of Just Compensation. In determining just
compensation, the cost of acquisition of the land, the value of the standing
crop, the current value of like properties, its nature, actual use and income, the
sworn valuation by the owner, the tax declarations, the assessment made by
government assessors, and seventy percent (70%) of the zonal valuation
of the Bureau of Internal Revenue (BIR), translated into a basic formula
by the DAR shall be considered, subject to the final decision of the proper
court. The social and economic benefits contributed by the farmers and the
farmworkers and by the Government to the property as well as the nonpayment
of taxes or loans secured from any government financing institution on the said
land shall be considered as additional factors to determine its valuation."
Assoc. of small landowners vs Hon. Secretary
JUST COMPENSATION; DEFINED. Just compensation is defined as the full and
fair equivalent of the property taken from its owner by the expropriator.
LBP v. Dumlao
Facts:
Respondents are owners of agri lands covered under PD 27;
Determination of just compensation remained pending with DAR, so they
filed complaint with RTC for determination.
SC:
if just compensation was not settled prior to the passage of RA No. 6657,
it should be computed in accordance with said law, although property
was acquired under PD No. 27;
the determination made by the trial court, which relied solely on the
formula prescribed by PD No. 27 and EO No. 228, is grossly erroneous.
The amount of P6,912.50 per hectare, which is based on the DAR
valuation of the properties "at the time of their taking in the 1970s",
does not come close to a full and fair equivalent of the property taken
from respondents;
Page 52
 CA's act of setting just compensation in the amount of P109,000.00
would have been a valid exercise of this judicial function, had it followed
the mandatory formula prescribed by RA No. 6657. However, the
appellate court merely chose the lower of two (2) values specified by the
commissioner as basis for determining just compensation, namely: (a)
P109,000.00 per hectare as the market value of first class unirrigated
rice land in the Municipality of Villaverde; and (b) P60.00 per square
meter as the zonal value of the land in other barangays in Villaverde.
This is likewise erroneous because it does not adhere to the formula
provided by RA No. 6657.
It cannot be overemphasized that the just compensation to be given to
the owner cannot be assumed and must be determined with certainty.
Section 17 was converted into a formula by the DAR through AO No. 6,
Series of 1992, as amended by AO No. 11, Series of 1994:
Basic formula (Voluntary Offer to Sell) or [Compulsory Acquisition]
regardless of the date of offer or coverage of the claim:
LV = (CNI x 0.6) + (CS x 0.3) + (MV x 0.1)
Where:
LV = Land Value
CNI = Capitalized Net Income
CS = Comparable Sales
MV = Market Value per Tax Declaration
The above formula shall be used if all the three factors are present,
relevant and applicable.
Note:
1. PD 27: uses average crop harvest as a consideration;
RA 6657: factors for consideration in determining just compensation.
2. RA 6657 for lands covered by PD 27 and just compensation has not been
determined at the time of passage of RA 6657 applies because PD 27 and EO
228 have only suppletory effect.
Take into account the nature of land (i.e., irrigated), market value, assessed
value at the time of the taking, location (i.e., along highway) and the volume
and value of its produce, like:
(a) prevailing market value of in the area and adjacent areas;
(b) presence and availability of an irrigation system to augment
and increase agricultural production;
(c) available comparable sales in the area;
(d) average harvests per hectare.
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
The date of taking of the subject land for purposes of computing just
compensation should be reckoned from the issuance dates of the
emancipation patents.
Why? EP constitutes the conclusive authority for the issuance of a
Transfer Certificate of Title in the name of the grantee. It is from the
issuance of an emancipation patent that the grantee can acquire the
vested right of ownership in the landholding, subject to the payment of
just compensation to the landowner.
However, their issuance dates are not shown. As such, the trial court
should determine the date of issuance of these emancipation patents in
order to ascertain the date of taking and proceed to compute the just
compensation due to respondents.
Petitioners argument that respondents should not be paid yet pending
determination by DAR is specious.
To wait for the DAR valuation despite its unreasonable neglect and delay
in processing is to violate the elementary rule that payment of just
compensation must be within a reasonable period from the taking of
property;
Citing Cosculluela v. CA, just compensation means not only the correct
determination of the amount to be paid to the owner of the land but also
the payment of the land within a reasonable time from its taking.
Without prompt payment, compensation cannot be considered "just" for
the property owner is made to suffer the consequence of being
immediately deprived of his land while being made to wait for a decade
or more before actually receiving the amount necessary to cope with his
loss
FACTORS (Section 17): 1. cost of acquisition ; 2. current value of like
properties;3. actual use & income & nature; 4. sworn valuation by owner; 5. tax
declaration; 6. assessment made by Government assessors.
Sps. Lee, vs. Land Bank of the Philippines,
Facts:
Petitioner were notified that their land holdings is covered by Gov't
Action Scheme pursuant to CARP. They received a notice of Land valuation from
DAR which offers P315, 307 for 3.195 hec. DAR Adjudication Board affirmed the
compensation and valuation and declared that LBP fully complied with the
criteria set forth by CARP. Petitioners sought reconsideration but was denied.
Page 53
Petitioner filed a petition for determination of Just Compensation before RTC.
RTC acting as Special Agrarian Court (SAC), citing appraisal report decided
P7,978,750.00 as just compensation and ordered LBP to pay.
Petition for review by LBP to CA and found that the SAC made a
wholesale adoption of the valuation of the appraisal company and did not
consider the other factors set forth in R.A. No. 6657 even though the appraisal
company admitted that it did not consider as applicable the CARP valuation of
the property. Hence, this petition.
Held:
The Court took note:
These factors have already been incorporated in a basic formula by the DAR
pursuant to its rule-making power under Section 49 of R.A. No. 6657. AO No. 5
precisely filled in the details of Section 17, R. A. No. 6657 by providing a basic
formula by which the factors mentioned therein may be taken into account. This
formula has to be considered by the SAC in tandem with all the factors referred
to in Section 17 of the law. The administrative order provides:
A. There shall be one basic formula for the valuation of lands covered by VOS or
CA:
LV = (CNI x 0.6) + (CS x 0.3) + (MV x 0.1)
Where:
LV = Land Value
CNI = Capitalized Net Income
CS = Comparable Sales
MV = Market Value per Tax Declaration
The above formula shall be used if all three factors are present, relevant, and
applicable.
A1. When the CS factor is not present and CNI and MV are applicable, the
formula shall be:
LV = (CNI x 0.9) + (MV x 0.1)
A2. When the CNI factor is not present, and CS and MV are applicable, the
formula shall be:
LV = (CS x 0.9) + (MV x 0.1)
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
A3. When both the CS and CNI are not present and only MV is applicable, the
formula shall be:
LV = MV x 2
In no case shall the value of idle land using the formula MV x 2 exceed the
lowest value of land within the same estate under consideration or within the
same barangay or municipality (in that order) approved by LBP within one (1)
year from receipt of claimfolder.
---
Where:
CNI=
(AGPxSP) - CO
.12
AGP= Average Gross Production corresponding to the latest available 12 months
gross production immediately preceding the date of FI (field investigation)
SP= Selling Price (the average of the latest available 12 months selling prices
prior to the date of receipt of the CF (claim folder) by LBP for processing, such
prices to be secured from the Department of Agriculture (DA) and other
appropriate regulatory bodies or, in their absence, from the Bureau of
Agricultural Statistics. If possible, SP data shall be gathered for the barangay or
municipality where the property is located. In the absence thereof, SP may be
secured within the province or region.
CO = Cost of Operations
Whenever the cost of operations could not be obtained or verified, an assumed
net income rate (NIR) of 20% shall be used. Landholdings planted to coconut
which are productive at the time of FI shall continue to use the assumed NIR of
70 %. DAR and LBP shall continue to conduct joint industry studies to establish
the applicable NIR for each crop covered under CARP.
0.12 = Capitalization rate
The Court finds that the factors required by the law and enforced by the
DAR Administrative Order were not observed by the SAC when it adopted
wholeheartedly the valuation arrived at in the appraisal report. The Court
Page 54
repremands the case to the RTC acting as a Special Agrarian Court for the
determination of just compensation in accordance with Section 17 of Republic
Act No. 6657.
Sps. Lee v. LBP
If valuation is based not on the factors, it is not valid .
(Note that in this case, there was admission that valuation was not
based on factors under CARL: a representative of the company admitted that it
did not consider the CARP valuation to be applicable).
Case remanded.
Land Bank of the Phils. vs. Heirs of Eleuterio Cruz,
Facts:
Landholding of the respondents was placed under the coverage of the
land transfer program of P.D. 27. Petitioner pegged the value of the acquired
landholding at P106,935.76 based on the guidelines set forth under P.D. No. 27
and E.O. 228. Respondents petitioned for valuation and determination of just
compensation before the Provincial Agrarian Reform Adjudicator which fixed it to
P80,000.00 per hectare. Motion for Reconsideration was denied so the Petitioner
petition for the determination of just compensation before the RTC acting as SAC
held that the value of P80,000.00 per hectare fixed by the PARAD should be
accorded weight and probative value and that the SAC is guided by the various
factors enumerated in Section 17of R.A. No. 6657 in determining just
compensation. It disregarded respondents' claim that the valuation should be
based on the current market value of the landholding since no evidence was
adduced in support of the claim and also did not accept petitioner's valuation as
it was based on P.D. No. 27, in which just compensation was determined at the
time of the taking of the property. CA rendered the assailed decision partly
granting petitioner's appeal but affirmed the SAC decision fixing just
compensation at P80,000.00 per hec. Reconsideration was denied. Hence, the
instant petition, arguing that the formula set forth in P.D. No. 27/E.O. No. 228
should be applied in fixing just compensation since respondents' landholding
was acquired under P.D. No. 27 in cognizance to a settled rule that just
compensation is the value of the property at the time of the taking, on 21
October 1972.
Held:
The Court citing Land Bank of the Philippines v. Natividad, It would
certainly be inequitable to determine just compensation based on the guideline
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
provided by PD No. 27 and EO 228 considering the DAR's failure to determine
the just compensation for a considerable length of time. That just compensation
should be determined in accordancewithRA6657,and not PD 27 or EO 228, is
especially imperative considering that just compensation should be the full and
fair equivalent of the property taken from its owner by the expropriator, the
equivalent being real, substantial, full and ample.
The Court remanded the determination of just compensation to RTC
acting as SAC.
LBP v. Heirs of Cruz
If valuation is not based on any evidence, it is w/o basis, so
determination be remanded.
In this case, decision of PARAD and SAC points to no evidence, so case
was remanded.
Is prior recourse to DARAB necessary before case for determination of JC may be
filed?
No:
(a) because DAR may continue to alienate the lots during the pendency
of protest;
(b) Sec. 57 of RA 6657 states that SAC has orig and exclusive
jurisdiction.
Content and Manner (Section 18)
Sec. 18 speaks of cash or shares of stock, tax credits or LBP bonds.
Is this not violation of usual way of payment in cash?
No, because revolutionary kind.
Parties involved (Section 18)
LBP vs. Jocson and sons
Facts:
The property was placed under the coverage of the government's Operation
Land Transfer 2 (OLT) pursuant to Presidential Decree (P.D.) No. 27 3 and
awarded to the tenant-beneficiaries by the Department of Agrarian Reform
(DAR), which valued the compensation therefor in the total amount of
P250,563.80 following the formula prescribed in P.D. No. 27 and Executive Order
(E.O.) No. 228. 4
The valuation was later increased to P903,637.03 after computing the 6%
annual interest increment 5 due on the property per DAR Administrative Order
No. 13, series of 1994, which amount respondent withdrew in 1997, without
Page 55
prejudice to the outcome of the case it had filed hereunder to fix just
compensation.
Finding the DAR's offer of compensation for the property to be grossly
inadequate, respondent filed a complaint 6 on July 18, 1997 before the Regional
Trial Court of Bacolod City, Br. 46, sitting as a Special Agrarian Court (SAC),
against the Land Bank (petitioner), 7 the DAR, and the tenant-beneficiaries, for
"Determination and Fixing of Just Compensation for the Acquisition of Land and
Payment of Rentals".
In their respective Answers, petitioner and the DAR claimed that the property
was acquired by the government under its OLT program and their valuation
thereof constituted just compensation, having been made pursuant to the
guidelines set by E.O. No. 228 and P.D. No. 27.
In arriving at the just compensation, the SAC adopted a higher valuation
(P93,657.00/hectare) which the DAR had applied to a similar landholding
belonging to one Pablo Estacion adjacent to respondent's.
Issue:
Whether the SAC erred in the valuation the land
HELD:
In the recent case of Land Bank of the Philippines v. Chico, 27 the Court declared
in no uncertain terms that R.A. No. 6657 is the relevant law for determining just
compensation after noting several decided cases where the Court found it more
equitable to determine just compensation based on the value of the property at
the time of payment. This was a clear departure from the Court's earlier stance
in Gabatin v. Land Bank of the Philippines where it declared that the reckoning
period for the determination of just compensation is the time when the land was
taken applying P.D. No. 27 and E.O. No. 228.
P.D. No. 27/E.O. No. 228 vis a vis R.A. No. 6657 was applied to cases involving
lands placed under the coverage of P.D. No. 27/E.O. No. 228 where payment of
just compensation had not been completed. When in the interim R.A. No. 6657
was passed before the full payment of just compensation, as in the case at bar,
the provisions of R.A. No. 6657 on just compensation control.
It would certainly be inequitable to determine just compensation based on the
guideline provided by PD 27 and EO 228 considering the DAR's failure to
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
determine the just compensation for a considerable length of time. That just
compensation should be determined in accordance with RA 6657, and not PD 27
or EO 228, is especially imperative considering that just compensation should be
the full and fair equivalent of the property taken from its owner by the
expropriator, the equivalent being real, substantial, full and ample.
LBP vs Livioco
Facts:
Respondent Enrique Livioco (Livioco) was the owner of 30.6329 hectares of
sugarland 6 located in Dapdap, Mabalacat, Pampanga. Sometime between 1987
and 1988, 7 Livioco offered his sugarland to the Department of Agrarian Reform
(DAR) for acquisition under the CARP at P30.00 per square meter, for a total of
P9,189,870.00. The voluntary-offer-to-sell (VOS) form 8 he submitted to the DAR
indicated that his property is adjacent to residential subdivisions and to an
international paper mill.
The DAR referred Livioco's offer to the LBP for valuation. Following Section 17 of
Republic Act (RA) No. 6657 and DAR Administrative Order No. 17, series of 1989,
11 as amended by Administrative Order No. 3, series of 1991, 12 the LBP set the
price at P3.21 per square meter or a total of P827,943.48 for 26 hectares.
Livioco was then promptly informed of the valuation 14 and that the cash
portion of the claim proceeds have been "kept in trust pending [his] submission
of the [ownership documentary] requirements." 15 It appears however that
Livioco did not act upon the notice given to him by both government agencies.
On September 20, 1991, LBP issued a certification to the Register of Deeds of
Pampanga that it has earmarked the amount of P827,943.48 as compensation
for Livioco's 26 hectares.
It was only two years later 17 that Livioco requested for a reevaluation of the
compensation on the ground that its value had already appreciated from the
time it was first offered for sale. 18 The request was denied by Regional Director
Antonio Nuesa on the ground that there was already a perfected sale.
Unable to recover his property but unwilling to accept what he believes was an
outrageously low valuation of his property, Livioco finally filed a petition for
judicial determination of just compensation against DAR, LBP, and the CLOA
holders.
In this Petition before us, LBP assails the CA's assent to the valuation of Livioco's
property as a residential land. It maintains that it is not the State's policy to
Page 56
purchase residential land. Since the property was acquired under the CARP, it
had to be valued as an agricultural land.
Issue
Was the compensation for respondent's property
determined in accordance with law?
HELD:
For purposes of just compensation, the fair market value of an expropriated
property is determined by its character and its price at the time of taking. 68
There are three important concepts in this definition the character of the
property, its price, and the time of actual taking.
The lower courts erred in ruling that the character or use of the property has
changed from agricultural to residential, because there is no allegation or proof
that the property was approved for conversion to other uses by DAR. It is the
DAR that is mandated by law to evaluate and to approve land use conversions
73 so as to prevent fraudulent evasions from agrarian reform coverage. Even
reclassification 74 and plans for expropriation 75 by local government units
(LGUs) will not ipso facto convert an agricultural property to residential,
industrial or commercial. Thus, in the absence of any DAR approval for the
conversion of respondent's property or an actual expropriation by an LGU, it
cannot be said that the character or use of said property changed from
agricultural to residential. Respondent's property remains agricultural and
should be valued as such. Hence, the CA and the trial court had no legal basis
for considering the subject property's value as residential.
Respondent's evidence of the value of his land as residential property (which the
lower courts found to be preponderant) could, at most, refer to the potential use
of the property. While the potential use of an expropriated property is
sometimes considered in cases where there is a great improvement in the
general vicinity of the expropriated property, 76 it should never control the
determination of just compensation (which appears to be what the lower courts
have erroneously done). The potential use of a property should not be the
principal criterion for determining just compensation for this will be contrary to
the well-settled doctrine that the fair market value of an expropriated property is
determined by its character and its price at the time of taking, not its potential
uses. If at all, the potential use of the property or its "adaptability for conversion
in the future is a factor, not the ultimate in determining just compensation." 77
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
The proper approach should have been to value respondent's property as an
agricultural land, which value may be adjusted in light of the improvements in
the Municipality of Mabalacat. Valuing the property as a residential land (as the
lower courts have done) is not the correct approach, for reasons explained
above. It would also be contrary to the social policy of agrarian reform, which is
to free the tillers of the land from the bondage of the soil without delivering
them to the new oppression of exorbitant land valuations. Note that in lands
acquired under RA 6657, it is the farmer-beneficiaries who will ultimately pay
the valuations paid to the former land owners (LBP merely advances the
payment). 78 If the farmer-beneficiaries are made to pay for lands valued as
residential lands (the valuation for which is substantially higher than the
valuation for agricultural lands), it is not unlikely that such farmers, unable to
keep up with payment amortizations, will be forced to give up their landholdings
in favor of the State or be driven to sell the property to other parties. This may
just bring the State right back to the starting line where the landless remain
landless and the rich acquire more landholdings from desperate farmers.
LBP vs Honeycomb
HELD: 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 the determination of just compensation.
Valuation and Payment (Section 18)
FORMS OF PAYMENT
SEC. 18. Valuation and Mode of Compensation. - The LBP shall compensate the
landowner in such amount as may be agreed upon by the landowner and the
DAR and LBP or as may be finally determined by the court as just compensation
for the land.
Page 57
The compensation shall be paid in one of the following modes at the option of
the landowner:
(1) Cash payment, under the following terms and conditions:
(a) For lands above fifty (50) hectares, insofar as the excess hectarage is
concerned - Twenty-five percent (25%) cash, the balance to be paid in
government financial instruments negotiable at any time.
(b) For lands above twenty-four hectares and up to fifty (50) hectares - Thirty
percent (30%) cash, the balance to be paid in government financial instruments
negotiable at any time.
(c) For lands twenty-four (24) hectares and below - Thirty-five percent (35%)
cash, the balance to be paid in government financial instruments negotiable at
any time.
(2) Shares of stock in government-owned or controlled corporations, LBP
preferred shares, physical assets or other qualified investments in accordance
with guidelines set by the PARC;
(3) Tax credits which can be used against any tax liability;
(4) LBP bonds, which shall have the following features:
(a) Market interest rates aligned with 91-day treasury bill rates. Ten percent
(10%) of the face value of the bonds shall mature every year from the date of
issuance until the tenth (10th) year: Provided, That should the landowner choose
to forego the cash portion, whether in full or in part, he shall be paid
correspondingly in LBP bonds;
(b) Transferability and negotiability. Such LBP bonds may be used by the
landowner, his successors-in-interest or his assigns, up to the amount of their
face value for any of the following:
(i) Acquisition of land or other real properties of the government, including
assets under the Assets Privatization Program and other assets foreclosed by
government financial institution in the same province or region where the lands
for which the bonds were paid are situated;
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
(ii) Acquisition of shares of stock of government-owned or controlled
corporations or shares or stock owned by the government in private
corporations;
(iii) Substitution for surety or bail bonds for the provisional release of accused
persons, or for performance bonds;
(iv) Security for loans with any government financial institution, provided the
proceeds of the loans shall be invested in an economic enterprise, preferably in
a small and medium-scale industry, in the same province or region as the land
for which the bonds are paid;
(v) Payment for various taxes and fees to the government: Provided, That the
use of these bonds for these purposes will be limited to a certain percentage of
the outstanding balance of the financial instrument: Provided, further, That the
PARC shall determine the percentages mentioned above;
(vi) Payment for tuition fees of the immediate family of the original bondholder
in government universities, colleges, trade schools and other institutions;
(vii) Payment for fees of the immediate family of the original bondholder in
government hospitals; and
(viii) Such other uses as the PARC may from time to time allow.
In case of extraordinary inflation, the PARC shall take appropriate
measures to protect the economy.
LBP vs Darab
- the valuation made by PARAB was rejected by the landowners, After re-
computation upon order of PARAD, a revaluated amount was made but Los still
found it low. Los appealed to DARAB,. Pending resolution of their appeal Los
interposed a Motion to Withdraw Amended Valuation seeking the release to tem
of the amount representing the difference between the initial value.
SC- the need to allow the landowners to withdraw immediately the amount
deposited in their behalf, pending final determination of what is just
compensation for their land
- it is a an oppressive exercise of eminent domain if you do not allow
withdraw
Page 58
- it is unnecessary to distinguish between provisional compensation
under Section 16 (e) and final compensation under Section 18 for the purposes
of exercising the landowners right to appropriate the same. The immediate
effect in other situations in the same, the landowner is deprived of the use and
possession of his property for which he should be fairly and immediately
compensated.
Heirs of Lorenzo vs. LBP
- Petitioner are owners of land; first valuation was rejected but upon re-
computation and order of RRAD, the revaluation was accepted by owners LBP
filed MR but denied, LBP filed an opposition for determination of JC with the RTC
- Petitioner submit that LBP has no legal personality
- SEC 18, clearly states there should be a consensus among
- LBP is an indispensable party in expropriation proceedingsund4r RA
6657 and thus has the legal personality to question the determination.
DAR vs Heirs of Domingo
Facts:
The late Angel T. Domingo (Domingo) is the registered owner of a 70.3420-
hectare rice land situated at Macapabellag, Guimba, Nueva Ecija, covered by
Transfer Certificate of Title No. NT-97157.
On October 21, 1972, Presidential Decree No. 27 2 (P.D. No. 27) was issued,
pursuant to which actual tenant farmers of private agricultural lands devoted to
rice and corn were deemed as full owners of the land they till. The land transfer
program under P.D. No. 27 was subsequently implemented by Executive Order
No. 228.
On April 26, 2000, Domingo filed with the Regional Trial Court (RTC) of Guimba,
Nueva Ecija a complaint for determination and payment of just compensation
against the Land Bank of the Philippines (LBP) and DAR.
Domingo opposed the said valuation and claimed that the just compensation for
the subject land should be computed using the parameters set forth under
Republic Act No. 6657 4 (R.A. No. 6657).
The LBP and DAR disputed Domingo's valuation and claimed that the
determination of just compensation should be governed by the provisions of P.D.
No. 27 in relation to E.O. No. 228.
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
ISSUE:
Whether the method set forth under R.A. No. 6657 in the computation of just
compensation may be applied to private agricultural lands taken by the
government under the auspices of P.D. No. 27 in relation to E.O. No. 228.
HELD:
Under the factual circumstances of this case, the agrarian reform process is still
incomplete as the just compensation to be paid private respondents has yet to
be settled. Considering the passage of Republic Act No. 6657 (RA 6657) before
the completion of this process, the just compensation should be determined and
the process concluded under the said law. Indeed, RA 6657 is the applicable law,
with PD 27 and EO 228 having only suppletory effect, conformably with our
ruling in Paris v. Alfeche.
xxx xxx xxx
It would certainly be inequitable to determine just compensation based on the
guideline provided by PD 27 and EO 228 considering the DAR's failure to
determine the just compensation for a considerable length of time. That just
compensation should be determined in accordance with RA 6657, and not PD 27
or EO 228, is especially imperative considering that just compensation should be
the full and fair equivalent of the property taken from its owner by the
expropriator, the equivalent being real, substantial, full and ample.
Content and manner of compensation
Assoc. of small landowners vs Hon. Sec.
We do not deal here with the traditional exercise of the power of eminent
domain. This is not an ordinary expropriation where only a specific property of
relatively limited area is sought to be taken by the State from its owner for a
specific and perhaps local purpose. What we deal with here is a revolutionary
kind of expropriation. The expropriation before us affects all private agricultural
lands whenever found and of whatever kind as long as they are in excess of the
maximum retention limits allowed their owners. Such a program will involve not
mere millions of pesos. The cost will be tremendous.
The other modes, which are likewise available to the landowner at his option,
are also not unreasonable because payment is made in shares of stock, LBP
Page 59
bonds, other properties or assets, tax credits, and other things of value
equivalent to the amount of just compensation.
Therefore, payment of the just compensation is not always required to be made
fully in money.
Parties Involved (Section 18)
Land Bank v. CA:
The parties are DAR, landowner and LBP. The law does not mention the
participation of farmer-beneficiary.
So consent of farmer-beneficiary is not required in establishing proper
compensation.
Voluntary offer (Section 19)
Section 19 provides for additional 5% cash payment if LO voluntarily
offers land for sale.
Voluntary land transfer (Secs. 20 and 21)
How is VLT made?
Sec. 20 LO may enter into voluntary arrangement for direct transfer to
qualified beneficiaries but subject to guidelines (i.e., all notices for VLT be
submitted to DAR within 1st year of implementation of CARP, terms and
conditions shall not be less favorable to transferee).
Sec. 21 direct payment may be made in cash or kind by ARB under terms
mutually agreed and which shall be binding upon registration and approval by
DAR.
Sec. 44 (2) provides that PARCOM shall recommend to PARC the
adoption of direct payment scheme. So, AO #2, s. 1995 was issued:
Beneficiaries are determined by DAR;
Area to be transferred to ARB should not be less than the area which the
govt would otherwise acquire;
CLOAs should bear proper annotations.
Payment in interest in just compensation
Apo Fruits corp. vs CA
Facts:
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
On October 12, 1995, AFC and HPI voluntarily offered to sell the lands subject of
this case pursuant to Republic Act No. 6657 (Comprehensive Agrarian Reform
Law, or CARL). The Department of Agrarian Reform (DAR) referred their
voluntary-offer-to-sell (VOS) applications to Land Bank for initial valuation. Land
Bank fixed the just compensation at P165,484.47/hectare, that is,
P86,900,925.88, for AFC, and P164,478,178.14, for HPI. The valuation was
rejected, however, prompting Land Bank, upon the advice of DAR, to open
deposit accounts in the names of the petitioners, and to credit in said accounts
the sums of P26,409,549.86 (AFC) and P45,481,706.76 (HPI). Both petitioners
withdrew the amounts in cash from the accounts, but afterwards, on February
14, 1997, they filed separate complaints for determination of just compensation
with the DAR Adjudication Board (DARAB).
When DARAB did not act on their complaints for determination of just
compensation after more than three years, the petitioners filed complaints for
determination of just compensation with the Regional Trial Court (RTC) in Tagum
City, Branch 2, acting as a special agrarian court (SAC), docketed as Agrarian
Cases No. 54-2000 and No. 55-2000. Summonses were served on May 23, 2000
to Land Bank and DAR, which respectively filed their answers on July 26, 2000
and August 18, 2000. The RTC conducted a pre-trial, and appointed persons it
considered competent, qualified and disinterested as commissioners to
determine the proper valuation of the properties.
The RTC rendered its decision:
DEPARTMENT OF AGRARIAN REFORM and/or LAND BANK OF THE PHILIPPINES,
thru its Land Valuation Office, to pay jointly and severally the Commissioners'
fees herein taxed as part of the costs pursuant to Section 12, Rule 67 of the
1997 Rules of Civil Procedure, equivalent to, and computed at Two and One-Half
(2 1/2) percent of the determined and fixed amount as the fair, reasonable and
just compensation of plaintiffs' land and standing crops plus interest equivalent
to the interest of the 91-Day Treasury Bills from date of taking until full
payment;
ISSUE:
Whether or not the interest was validly imposed.
HELD:
Page 60
It is true that Land Bank sought to appeal the RTC's decision to the CA, by filing
a notice of appeal; and that Land Bank filed in March 2003 its petition for
certiorari in the CA only because the RTC did not give due course to its appeal.
Any intervening delay thereby entailed could not be attributed to Land Bank,
however, considering that assailing an erroneous order before a higher court is a
remedy afforded by law to every losing party, who cannot thus be considered to
act in bad faith or in an unreasonable manner as to make such party guilty of
unjustified delay. As stated in Land Bank of the Philippines v. Kumassie
Plantation: 18 HAcaCS
The mere fact that LBP appealed the decisions of the RTC and the Court of
Appeals does not mean that it deliberately delayed the payment of just
compensation to KPCI. . . . It may disagree with DAR and the landowner as to the
amount of just compensation to be paid to the latter and may also disagree with
them and bring the matter to court for judicial determination. This makes LBP an
indispensable party in cases involving just compensation for lands taken under
the Agrarian Reform Program, with a right to appeal decisions in such cases that
are unfavorable to it. Having only exercised its right to appeal in this case, LBP
cannot be penalized by making it pay for interest.
It is explicit from LBP v. Wycoco that interest on the just compensation is
imposed only in case of delay in the payment thereof which must be sufficiently
established. Given the foregoing, we find that the imposition of interest on the
award of just compensation is not justified and should therefore be deleted.
It must be emphasized that "pertinent amounts were deposited in favor of AFC
and HPI within fourteen months after the filing by the latter of the Complaint for
determination of just compensation before the RTC". It is likewise true that AFC
and HPI already collected P149.6 and P262 million, respectively, representing
just compensation for the subject properties. Clearly, there is no unreasonable
delay in the payment of just compensation which should warrant the award of
12% interest per annum in AFC and HPI's favor.
LBP vs Soriano
Facts:
Domingo and Mamerto Soriano (respondents) are the registered owners of
several parcels of rice land situated in Oas, Albay. Out of the 18.9163 hectares
of land 3 owned by the respondents, 18.2820 hectares were placed under the
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
Operations Land Transfer and the CARP pursuant to Presidential Decree No. 27 4
and Republic Act No. 6657, otherwise known as the Comprehensive Agrarian
Reform Law. 5
The LBP 6 pegged the value of 18.0491 hectares of land at P482,363.95 7
(P133,751.65 as land value plus P348,612.30 incremental interest), while the
remaining 0.2329 hectare was computed at P8,238.94. 8 Not satisfied with the
valuation, respondents, on 23 November 2000, instituted a Complaint 9 for
judicial determination of just compensation with the Regional Trial Court of
Legazpi City, 10 sitting as a Special Agrarian Court (SAC). Respondents alleged
that they are entitled to an amount of not less than P4,500,000.00 as just
compensation. 11
On 21 February 2005, the SAC rendered a judgment, ordering LBP to pay the
respondents P894,584.94. The dispositive portion reads:
ACCORDINGLY, the just compensation of the 18.0491 hectares of irrigated
riceland is P133,751.79, plus increment of 6% per annum computed annually
beginning October 21, 1972, until the value is fully paid, and of the 0.2329
hectare of rain fed riceland is P8,238.94 plus 12% interest per annum, beginning
August 17, 1998, until the value is fully paid or a total of P894,584.94 as of this
date. Land Bank is ordered to pay the landowners Domingo Soriano and
Mamerto Soriano said amount/land value in accordance with law.
Both parties disagreed with the trial court's valuation, prompting them to file
their respective appeals with the Court of Appeals. The appellate court, however,
affirmed the judgment of the trial court. It also upheld the award of compounded
interest, thus:
In the case at bar, the subject lands were taken under PD 27 and were covered
by Operation Land Transfer, making the aforecited Administrative Order
applicable.
HELD:
In the instant case, while the subject lands were acquired under Presidential
Decree No. 27, the complaint for just compensation was only lodged before the
court on 23 November 2000 or long after the passage of Republic Act No. 6657
in 1988. Therefore, Section 17 of Republic Act No. 6657 should be the principal
basis of the computation for just compensation. As a matter of fact, the factors
Page 61
enumerated therein had already been translated into a basic formula by the DAR
pursuant to its rule-making power under Section 49 of Republic Act No. 6657.
The award of interest until full payment of just compensation is to ensure
prompt payment. Moreover, respondents claim that the date LBP approves the
payment of the land transfer claim and deposits the proceeds in the name of the
landowner is not tantamount to actual payment because on said date, the
release of the amount is conditioned on certain requirements.
Note: RA 6657 12%
PD 27 6%
LBP vs Rivera
Facts:
The respondents are the co-owners of a parcel of agricultural land embraced by
Original Certificate of Title No. P-082, and later transferred in their names under
Transfer Certificate of Title No. T-95690 that was placed under the coverage of
Operation Land Transfer pursuant to Presidential Decree No. 27 in 1972. Only
18.8704 hectares of the total area of 20.5254 hectares were subject of the
coverage.
After the Department of Agrarian Reform (DAR) directed payment, LBP approved
the payment of P265,494.20, exclusive of the advance payments made in the
form of lease rental amounting to P75,415.88 but inclusive of 6% increment of
P191,876.99 pursuant to DAR Administrative Order No. 13, series of 1994.
On 1 December 1994, the respondents instituted Civil Case No. 94-03 for
determination and payment of just compensation before the Regional Trial
Court.
LBP filed its answer, stating that rice and corn lands placed under the coverage
of Presidential Decree No. 27 7 were governed and valued in accordance with
the provisions of Executive Order No. 228 8 as implemented by DAR
Administrative Order No. 2, Series of 1987 and other statutes and administrative
issuances; that the administrative valuation of lands covered by Presidential
Decree No. 27 and Executive Order No. 228 rested solely in DAR and LBP was
the only financing arm; that the funds that LBP would use to pay compensation
were public funds to be disbursed only in accordance with existing laws and
regulations; that the supporting documents were not yet received by LBP; and
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
that the constitutionality of Presidential Decree No. 27 and Executive Order No.
228 was already settled.
In Republic v. Court of Appeals, 19 we affirmed the award of 12% interest on just
compensation due to the landowner. The court decreed:
The constitutional limitation of "just compensation" is considered to be the sum
equivalent to the market value of the property, broadly described to be the price
fixed by the seller in open market in the usual and ordinary course of legal
action and competition or the fair value of the property as between one who
receives, and one who desires to sell, if fixed at the time of the actual taking by
the government. Thus, if property is taken for public use before
compensation is deposited with the court having jurisdiction over the
case, the final compensation must include interest on its just value to
be computed from the time the property is taken to the time when
compensation is actually paid or deposited with the court. In fine,
between the taking of the property and the actual payment, legal
interests accrue in order to place the owner in a position as good as
(but not better than) the position he was in before the taking occurred.
The Bulacan trial court, in its 1979 decision, was correct in imposing interest on
the zonal value of the property to be computed from the time petitioner
instituted condemnation proceedings and "took" the property in September
1969. This allowance of interest on the amount found to be the value of the
property as of the time of the taking computed, being an effective forbearance,
at 12% per annum should help eliminate the issue of the constant fluctuation
and inflation of the value of the currency over time.
Voluntary Offer for Sale (Section 19)
SEC. 19. Incentives for Voluntary Offers for Sale. - Landowners other than banks
and other financial institutions who voluntarily offer their lands for sale shall be
entitled to an additional five percent (5%) cash payment.
Voluntary Transfer (Section 20 and 21)
SEC. 20. Voluntary Land Transfer. - Landowners of agricultural lands subject to
acquisition under this Act may enter into a voluntary arrangement for direct
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transfer of their lands to qualified beneficiaries subject to the following
guidelines:
(a) All notices for voluntary land transfer must be submitted to the DAR within
the first year of the implementation of the CARP. Negotiations between the
landowners and qualified beneficiaries covering any voluntary land transfer
which remain unresolved after one (1) year shall not be recognized and such
land shall instead be acquired by the government and transferred pursuant to
this Act.
(b) The terms and conditions of such transfer shall not be less favorable to the
transferee than those of the government's standing offer to purchase from the
landowner and to resell to the beneficiaries, if such offers have been made and
are fully known to both parties.
(c) The voluntary agreement shall include sanctions for non-compliance by
either party and shall be duly recorded and its implementation monitored by the
DAR.
SEC. 21. Payment of Compensation by Beneficiaries Under Voluntary Land
Transfer.- Direct payment in cash or in kind may be made by the farmer-
beneficiary to the landowner under terms to be mutually agreed upon by both
parties, which shall be binding upon them, upon registration with and approval
by the DAR. Said approval shall be considered given, unless notice of
disapproval is received by the farmer-beneficiary within 30 days from the date of
registration. In the event they cannot agree on the price of the land, the
procedure for compulsory acquisition as provided in Section 16 shall apply. The
LBP shall extend financing to the beneficiaries for purposes of acquiring the
land.
Chapter VII
QUALIFIED BENEFICIARIES
(1) The lands covered by the CARP shall be distributed as much as possible to
landless residents of the same barangay, or in the absence thereof, landless
residents of the same municipality in the following order of priority:
(a) agricultural lessees and share tenants;
(b) regular farmworkers;
(c) seasonal farmworkers;
(d) other farmworkers;
(e) actual tillers or occupants of public lands;
(f) collectives or cooperatives of the above beneficiaries; and
(g) others directly working on the land;
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
(2) The children of landowners who are qualified shall be given preference in the
distribution of the land of their parents.
(3) Actual tenant-tillers in the landholding shall not be ejected or removed
therefrom.
(4) Beneficiaries under Presidential Decree No.27 who have culpably sold,
disposed of, or abandoned their lands are disqualified to become beneficiaries
under the Program.
(5) A basic qualification of a beneficiary shall be his willingness, aptitude, and
ability to cultivate and make the land as productive as possible.
(6) If, due to the landowners retention rights or to the number of tenants,
lessees, or workers on the land, there is not enough land to accommodate any
or some of them, they may be granted ownership of other lands available for
distribution under the Act, at the option of the beneficiaries.
(8) No qualified beneficiary may own more than three (3) hectares of agricultural
land. (Sec. 23)
Section 22 of the CARL does not limit qualified beneficiaries to tenants of the
landowners. Thus, the DAR cannot be deemed to have committed grave abuse
of discretion simply because its chosen beneficiaries were not tenants of PCPCI
(DAR vs. Polo Coconut Plantation Co., In., et al., G.R. 168787,
September 3, 2008).
Award Ceiling Limit (Section 23)
SEC. 23. Distribution Limit. - No qualified beneficiary may own more than three
(3) hectares of agricultural land.
AWARD TO BENEFICIARIES
Ownership of the beneficiary shall be evidenced by a Certificate of Land
Ownership Award, which shall contain the restrictions and conditions
provided for in the Act, and shall be recorded in the Register of Deeds
concerned and annotated on the Certificate of Title. (Sec. 24)
Issuance of CARP Beneficiary Certificate
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 When certificate issued. Section 24 of R.A. No. 6657 provides that the
rights and responsibilities of the beneficiary shall commence from the
time the DAR makes an award of the land to him, which award shall be
completed within 180 days from the time the DAR takes actual
possession of the land. Ownership of the lands by the beneficiary shall
be evidenced by an Emancipation Patent (EP) or a Certificate of Land
Ownership Award (CLOA), which shall contain the restrictions, and
conditions provided by law and which shall be recorded in the Register
of Deeds concerned and annotated on the Certificate of Title.
In several instances, however, the EP or CLOA cannot be immediately issued
pending the fulfillment of certain legal and administrative requirements.
Examples of these are:
(a) The Supreme Court ruling in the case of Association of Small Landowners in
the Philippines, Inc. v. Secretary of Agrarian Reform (G.R. No. 76742, 14,July
1989.) that title to all expropriated properties shall be transferred to the State
only upon full payment of compensation to their respective landowners;
(b) The conduct of subdivision surveys to define the specific parcel of land being
awarded through the EP or CLOA.
Cont. of Issuance of CARP Beneficiary Certificate (1)
Thus, pending the fulfillment of the said requirements, the identified
beneficiaries may already be in possession of the land but still have no
EP or CLOA therefor. For this reason, the DAR shall first issue a CARP
Beneficiary Certificate (CBC) to provide the would-be beneficiaries, an
intermediate document to evidence that they have been identified and
have qualified as agrarian reform beneficiaries under the CARP.
Moreover, aside from attesting to the inchoate right of the identified
beneficiary to be awarded the land or portion thereof, the CBC issued
shall entitle the recipient to receive support services under the CARP.
PAYMENT BY BENEFICIARIES
(1)Lands awarded pursuant to the Act shall be paid for by the beneficiaries to
the LBP in thirty (30) annual amortization at 6% interest per annum subject to
the following rules:
(a) The payments for the first three (3) years after the award may be at
reduced amounts as established by the PARC.
(b) The first five (5) annual payments may not be more than 5% of the
value of the annual gross production as established by the DAR.
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
(c) Should the scheduled annual payments after the fifth year exceed 10%
of the annual gross production and the failure to produce accordingly is not due
to the beneficiarys fault, the LBP may reduce the interest rate or reduce the
principal obligation to make the repayment affordable.
(2) The LBP shall have a lien (i.e., prior right) by way of mortgage on the land
awarded to the beneficiary; and this mortgage may be foreclosed by the LBP for
non-payment of an aggregate of three(3) annual amortization. The LBP shall
advice the DAR of such proceedings and the latter shall subsequently award the
forfeited landholding to other qualified beneficiaries. A beneficiary whose land
has been foreclosed shall thereafter be permanently disqualified from becoming
a beneficiary under the Act. (Sec. 26.)
TRANSFERABILITY OF AWARDED LANDS
(1) Lands acquired by beneficiaries under the Act may not be sold,
transferred or conveyed except through hereditary succession, or to the
government, or to the LBP or to other qualified beneficiaries for a period of ten
(10) years. However, the children of the spouse of the transferor shall have a
right to repurchase the land from the government or LBP within a period of two
(2) years. Due notice of the availability of the land shall be given by the LBP to
the Barangay Agrarian Reform Committee (BARC) of the barangay where the
land is situated. The Provincial Agrarian Reform Coordinating Committee
(PARCCOM) shall, in turn, be given the due notice thereof by the BARC.
(2) If the land has not yet been fully paid by the beneficiary, the rights to the
land may be transferred or conveyed, with prior approval of the DAR, to any heir
of the beneficiary or to any other beneficiary who, as a condition for such
transfer or conveyance, shall cultivate the land himself.
Lebrudo vs Loyola
Facts:
Respondent Remedios Loyola (Loyola) owns a parcel of land located in Barangay
Milagrosa, Carmona, Cavite, awarded by the Department of Agrarian Reform
(DAR) under Republic Act No. 6657 4 (RA 6657) or the Comprehensive Agrarian
Reform Law of 1988. This lot is covered by Certificate of Land Ownership 5
(CLOA) No. 20210 issued in favor of Loyola on 27 December 1990 and duly
registered on 14 March 1991 under Transfer of Certificate of Title (TCT)/CLOA
No. 998.
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On 27 June 1995, petitioner Julian S. Lebrudo (Lebrudo), now deceased and
represented by his son, petitioner Reynaldo L. Lebrudo, filed with the Office of
the Provincial Agrarian Reform Adjudicator (PARAD) of Trece Martires City,
Cavite, an action 6 for the cancellation of the TCT/CLOA in the name of Loyola
and the issuance of another for the one-half portion of the lot in Lebrudo's favor.
In a Decision 7 dated 18 December 1995, the PARAD dismissed the case without
prejudice on the ground that the case was filed prematurely. On 11 March 1996,
Lebrudo re-filed the same action. 8
Lebrudo alleged that he was approached by Loyola sometime in 1989 to redeem
the lot, which was mortgaged by Loyola's mother, Cristina Hugo, to Trinidad
Barreto. After Lebrudo redeemed the lot for P250.00 and a cavan of palay,
Loyola again sought Lebrudo's help in obtaining title to the lot in her name by
shouldering all the expenses for the transfer of the title of the lot from her
mother, Cristina Hugo. In exchange, Loyola promised to give Lebrudo the one-
half portion of the lot. Thereafter, TCT/CLOA No. 998 was issued in favor of
Loyola. Loyola then allegedly executed a Sinumpaang Salaysay 9 dated 28
December 1989, waiving and transferring her rights over the one-half portion of
the lot in favor of Lebrudo. To reiterate her commitment, Loyola allegedly
executed two more Sinumpaang Salaysay 10 dated 1 December 1992 and 3
December 1992, committing herself to remove her house constructed on the
corresponding one-half portion to be allotted to Lebrudo.
Thereafter, Lebrudo asked Loyola to comply with her promise. However, Loyola
refused. Lebrudo sought the assistance of the Sangguniang Barangay of
Milagrosa, Carmona, Cavite; the Philippine National Police (PNP) of Carmona,
Cavite; and the Department of Agrarian Reform to mediate. However, despite
steps taken to amicably settle the issue, as evidenced by certifications from the
PNP and the barangay, there was no amicable settlement. Thus, Lebrudo filed an
action against Loyola.
In her Answer, Loyola maintained that Lebrudo was the one who approached her
and offered to redeem the lot and the release of the CLOA. Loyola denied
promising one-half portion of the lot as payment for the transfer, titling and
registration of the lot. Loyola explained that the lot was her only property and it
was already being occupied by her children and their families.
ISSUE:
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
The main issue is whether Lebrudo is entitled to the one-half portion of the lot
covered by RA 6657 on the basis of the waiver and transfer of rights embodied
in the two Sinumpaang Salaysay.
HELD:
A Certificate of Land Ownership or CLOA is a document evidencing ownership of
the land granted or awarded to the beneficiary by DAR, and contains the
restrictions and conditions provided for in RA 6657 and other applicable laws.
Section 27 of RA 6657, as amended by RA 9700, 20 which provides for the
transferability of awarded lands, states:
SEC. 27.Transferability of Awarded Lands. Lands acquired by beneficiaries
under this ACT may not be sold, transferred or conveyed except through
hereditary succession, or to the government, or to the LBP, or to other qualified
beneficiaries for a period of ten (10) years.
It is clear from the provision that lands awarded to beneficiaries under the
Comprehensive Agrarian Reform Program (CARP) may not be sold, transferred or
conveyed for a period of 10 years. The law enumerate four exceptions: (1)
through hereditary succession; (2) to the government; 3) to the Land Bank of the
Philippines (LBP); or (4) to other qualified beneficiaries. In short, during the
prohibitory 10-year period, any sale, transfer or conveyance of land reform
rights is void, except as allowed by law, in order to prevent a circumvention of
agrarian reform laws.
In the present case, Lebrudo insists that he is entitled to one-half portion of the
lot awarded to Loyola under the CARP as payment for shouldering all the
expenses for the transfer of the title of the lot from Loyola's mother, Cristina
Hugo, to Loyola's name. Lebrudo used the two Sinumpaang Salaysay executed
by Loyola alloting to him the one-half portion of the lot as basis for his claim.
Lebrudo's assertion must fail. The law expressly prohibits any sale, transfer or
conveyance by farmer-beneficiaries of their land reform rights within 10 years
from the grant by the DAR. The law provides for four exceptions and Lebrudo
does not fall under any of the exceptions. In Maylem v. Ellano, 21 we held that
the waiver of rights and interests over landholdings awarded by the government
is invalid for being violative of agrarian reform laws. Clearly, the waiver and
transfer of rights to the lot as embodied in the Sinumpaang Salaysay executed
Page 65
by Loyola is void for falling under the 10-year prohibitory period specified in RA
6657.
NON-LAND TRANSFER SCHEMES
(1) Leasehold Operations (LO)- lands within the land owners retained areas
or lands not yet due for distribution are placed under leasehold to
ensure farmers security over the land they till and pre-empt their
displacement while waiting for the eventual distribution of the land;
(2) Production Profit Sharing (PPS)- This scheme is an interim measure while
the lands owned or operated by agricultural entities await coverage
under the CARP. There entities are companies mostly involved in the
commercial production of rubber, banana, and pineapple;
(3) Stock Distribution Option (SDO). - Under this arrangement, the farmers
are entitled to dividends and other financial benefits and are also
assured of at least a representatives at the Board of Directors,
management or executive committee to protect the rights and interest
of shareholders; and
(4) Commercial Farm Deferment (SFD). This scheme provides corporate
landowners of newly-established commercial plantations enough time to
recover their investment before such agricultural lands are covered by
CARP. The deferment period was up to 1998. Pending final land transfer,
however, these corporations shall implement a production and profit-
sharing scheme in their farms.
The monitoring of non-land transfer activities by the field offices of the DAR has
not been given much priority, as there has been greater pressure for them to
deliver their land acquisition and distribution (LAD) targets.
Chapter VIII (Corporate Farms)
SEC. 31. Corporate Landowners. - Corporate landowners may voluntarily
transfer ownership over their agricultural landholdings to the Republic of the
Philippines pursuant to Section 20 hereof or to qualified beneficiaries, under
such terms and conditions consistent with this Act, as they may agree upon,
subject to confirmation by the DAR.
Upon certification by the DAR, corporations owning agricultural lands may give
their qualified beneficiaries the right to purchase such proportion of the capital
stock of the corporation that the agricultural land, actually devoted to
agricultural activities, bears in relation to the company's total assets, under such
terms and conditions as may be agreed upon by them. In no case shall the
compensation received by the workers at the time the shares of stocks are
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
distributed be reduced. The same principle shall be applied to associations, with
respect to their equity or participation.
Corporations or associations which voluntarily divest a proportion of their capital
stock, equity or participation in favor of their workers or other qualified
beneficiaries under this section shall be deemed to have complied with the
provisions of this Act: Provided, That the following condition are complied with:
(a) In order to safeguard the right of beneficiaries who own shares of stocks to
dividends and other financial benefits, the books of the corporation or
association shall be subject to periodic audit by certified public accountants
chosen by the beneficiaries;
(b) Irrespective of the value of their equity in the corporation or association, the
beneficiaries shall be assured of at least one (1) representative in the board of
directors, or in a management or executive committee, if one exists, of the
corporation or association;
(c) Any shares acquired by such workers and beneficiaries shall have the same
rights and features as all other shares; and
(d) Any transfer of shares of stocks by the original beneficiaries shall be void ab
initio UNLESS said transaction is in favor of a qualified and registered beneficiary
within the same corporation.
If within two (2) years from the approval of this Act, the land or stock transfer
envisioned above is not made or realized or the plan for such stock distribution
approved by the PARC within the same period, the agricultural land of the
corporate owners or corporation shall be subject to the compulsory coverage of
this Act.
HLI vs PRAC
BASIC Facts:
THE HACIENDA COMPRISED 6,443 HAS. IN 1957 TABACALERA SOLD THE LAND
TO TADECO OWNED BY THE COJUANCOS. GSIS FINANCED THE PURCHASE ON
CONDITION THAT THE LAND WILL ULTIMATELY BE SUBDIVIDED AND SOLD TO
THE TENANTS.
IN 1980 GOVT FILED AT RTC MANILA CASE AGAINST TADECO FOR IT TO
SURRENDER THE HACIENDA TO MAR (NOW DAR) SO THE LAND WILL BE
DISTRIBUTED TO FARMERS. MANILA RTC RULED AGAINST TADECO. TADECO
APPEALED TO CA. IN 1988 CA DISMISSED THE APPEAL SUBJECT TO REVIVAL IF
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TADECO FAILS TO GET APPROVAL OF FARMERS OF STOCK DISTRIBUTION OPTION
(SDO) AND IF OPTED BY FARMERS TADECO FAILS TO IMPLEMENT SDO.
IN 1988 TADECO CREATED HACIENDA LUISITA INC (HLI) AND TADECO BOUGHT
SHARES OF HLI IN EXCHANGE OF THE HACIENDA LAND. THE TOTAL SHARES
WERE 400,000,000 WITH PAR VALUE OF P400,000,000.00. 150,000,000 SHARES
WERE FOR FARMERS AND 250,000,000 SHARES FOR OTHER STOCKHOLDERS.
FARMERS AND HLI ENTERED INTO STOCK DISTRIBUTION OPTION AGREEMENT
(SDOA) WHICH PROVIDES THAT FARMERS AGREE BECAUSE SUCH SDO WILL
IMPROVE THEIR LIVES AND THEY WILL GET GREATER BENEFITS. DAR APPROVED
SDOA.
IN 1995 HLI APPLIED TO CONVERT 500 HAS TO INDUSTRIAL USE. CONVERSION
WS APPROVED. THEN IT TRANSFERRED THE 500 HAS TO CENTENNARY
HOLDINGS INC WHICH TRANSFERRED IT TO LUISTA INDUSTRIAL PARK CORP OR
LIPCO. LIPCO CONVEYED SOME LANDS TO RCBC AS PAYMENT FOR LOANS. IN
ADDITION TO THE 500 HAS SOLD TO LIPCO, 80.51 HAS WAS EXPROPRIATED FOR
USE OF SCTEX.
IN 2003 FARMER GROUPS FILED CASE AT DAR FOR EITHER RENEGOTIATION OF
SDOA OR ITS REVOCATION ON GROUND THAT THEIR LIVES DID NOT IMPROVE
AND THEY DID NOT GET FAIR SHARES IN THE SALE OF LANDS TO LIPCO AND FOR
SCTEX USE. DAR CREATED TASK FORCE WHICH RECOMMENDED TO PARC
(PRESIDENTIAL AGRARIAN REFORM COUCIL) THAT THE PREVIOUS ORDER
APPROVING THE SDO BE REVOKED.
IN 2005 PARC REVOKED THE SDO AND ORDERED THE COMPULSORY
ACQUISITION OF THE HACIENDA FOR DISTRIBUTION TO FARMERS. HLI WENT TO
THE SC AND ASKED FOR TRO TO STOP IMPLEMENTATION OF PARK ORDER. IN
2006 SC ISSUED TRO. HENCE THE CASE.
XXXXXXXXXXXXXXXXXX
ISSUE:
HLI ARGUES THAT PARC IS WITHOUT AUTHORITY TO REVOKE THE STOCK
DISTRIBUTION PLAN (SDP). THE LAW GIVES PARC THE POWER TO APPROVDE
SDP. BUT THE LAW DOES NOT PROVIDE THAT IT CAN DISAPPROVE THE SDP. IS
HLIS ARGUMENT CORRECT?
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
NO. IF PARC WAS GIVEN POWER TO APPROVE SDP, IT HAS THE POWER TO
REVOKE IT BY THE DOCTRINE OF NECESSARY IMPLICATION. OTHERWISE PARC
WOULD BE A TOOTHLESS AGENCY.
On the postulate that the subject jurisdiction is conferred by law, HLI maintains
that PARC is without authority to revoke an SDP, for neither RA 6657 nor EO 229
expressly vests PARC with such authority. While, as HLI argued, EO 229
empowers PARC to approve the plan for stock distribution in appropriate cases,
the empowerment only includes the power to disapprove, but not to recall its
previous approval of the SDP after it has been implemented by the parties.[13]
[93] To HLI, it is the court which has jurisdiction and authority to order the
revocation or rescission of the PARC-approved SDP.
HELD
We disagree.
Under Sec. 31 of RA 6657, as implemented by DAO 10, the authority to approve
the plan for stock distribution of the corporate landowner belongs to PARC.
However, contrary to petitioner HLIs posture, PARC also has the power to
revoke the SDP which it previously approved. It may be, as urged, that RA 6657
or other executive issuances on agrarian reform do not explicitly vest the PARC
with the power to revoke/recall an approved SDP. Such power or authority,
however, is deemed possessed by PARC under the principle of necessary
implication, a basic postulate that what is implied in a statute is as much a part
of it as that which is expressed.[14][94]
We have explained that every statute is understood, by implication, to contain
all such provisions as may be necessary to effectuate its object and purpose, or
to make effective rights, powers, privileges or jurisdiction which it grants,
including all such collateral and subsidiary consequences as may be fairly and
logically inferred from its terms.[15][95] Further, every statutory grant of
power, right or privilege is deemed to include all incidental power, right or
privilege.[16][96]
Gordon v. Veridiano II is instructive:
The power to approve a license includes by implication, even if not expressly
granted, the power to revoke it. By extension, the power to revoke is limited by
the authority to grant the license, from which it is derived in the first place.
Thus, if the FDA grants a license upon its finding that the applicant drug store
has complied with the requirements of the general laws and the implementing
administrative rules and regulations, it is only for their violation that the FDA
may revoke the said license. By the same token, having granted the permit upon
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his ascertainment that the conditions thereof as applied x x x have been
complied with, it is only for the violation of such conditions that the mayor may
revoke the said permit.[17][97] (Emphasis supplied.)
Following the doctrine of necessary implication, it may be stated that the
conferment of express power to approve a plan for stock distribution of the
agricultural land of corporate owners necessarily includes the power to revoke or
recall the approval of the plan.
As public respondents aptly observe, to deny PARC such revocatory power would
reduce it into a toothless agency of CARP, because the very same agency tasked
to ensure compliance by the corporate landowner with the approved SDP would
be without authority to impose sanctions for non-compliance with it.[18][98]
With the view We take of the case, only PARC can effect such revocation. The
DAR Secretary, by his own authority as such, cannot plausibly do so, as the
acceptance and/or approval of the SDP sought to be taken back or undone is the
act of PARC whose official composition includes, no less, the President as chair,
the DAR Secretary as vice-chair, and at least eleven (11) other department
heads.[19][99]
Xxxxxxxxxxxxxxxxxxxxxxxxx
WHAT IS THIS DOCTRINE OF NECESSARY IMPLICATION?
WHAT IS IMPLIED IN A STATUTE IS AS MUCH A PART OF IT AS THAT WHICH IS
EXPRESSED.[20][94] EVERY STATUTE IS UNDERSTOOD, BY IMPLICATION, TO
CONTAIN ALL SUCH PROVISIONS AS MAY BE NECESSARY TO EFFECTUATE ITS
OBJECT AND PURPOSE, OR TO MAKE EFFECTIVE RIGHTS, POWERS, PRIVILEGES
OR JURISDICTION WHICH IT GRANTS, INCLUDING ALL SUCH COLLATERAL AND
SUBSIDIARY CONSEQUENCES AS MAY BE FAIRLY AND LOGICALLY INFERRED
FROM ITS TERMS.[21][95]FURTHER, EVERY STATUTORY GRANT OF POWER,
RIGHT OR PRIVILEGE IS DEEMED TO INCLUDE ALL INCIDENTAL POWER, RIGHT OR
PRIVILEGE
ISSUE
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
RESPONDENT FARM ARGUES THAT SEC 31 OF RA 6657 WHICH ALLOWS STOCK
DISTRIBUTION INSTEAD OF LAND DISTRIBUTION IS UNCONSTITUTIONAL AS IT
CONTRAVENES SECTION 4, ART. X111 OF THE CONSTITUTION. IS THIS
ARGUMENT CORRECT?
NO. THE REQUIREMENTS FOR QUESTIONING THE CONSTITUTIONALITY OF A LAW
ARE NOT ALL COMPLIED WITH. THESE REQUIREMENTS ARE: (1) THERE IS AN
ACTUAL CASE OR CONTROVERSY; (2) THAT THE CONSTITUTIONAL QUESTION IS
RAISED AT THE EARLIEST POSSIBLE OPPORTUNITY BY A PROPER PARTY OR ONE
WITH LOCUS STANDI; AND (3) THE ISSUE OF CONSTITUTIONALITY MUST BE
THE VERY LIS MOTA OF THE CASE.[32][108]
THE FARMERS QUESTIONED THE CONSITUTIONALITY OF R.A. 6657 ONLY AFTER
14 YEARS SINCE THE SDP WAS DRAWN AND IMPLEMENTED. IT IS TOO LATE.
ALSO, THE CONSTITUTIONALITY ISSUE REGARDING THE SDP WAS NOT THE LIST
MOTA. IT WAS THE IMPLEMENTATION OF THE SDP.
FARM asks for the invalidation of Sec. 31 of RA 6657, insofar as it affords the
corporation, as a mode of CARP compliance, to resort to stock distribution, an
arrangement which, to FARM, impairs the fundamental right of farmers and
farmworkers under Sec. 4, Art. XIII of the Constitution.[33][106]
To a more specific, but direct point, FARM argues that Sec. 31 of RA 6657
permits stock transfer in lieu of outright agricultural land transfer; in fine, there
is stock certificate ownership of the farmers or farmworkers instead of them
owning the land, as envisaged in the Constitution. For FARM, this modality of
distribution is an anomaly to be annulled for being inconsistent with the basic
concept of agrarian reform ingrained in Sec. 4, Art. XIII of the Constitution.[34]
[107]
Reacting, HLI insists that agrarian reform is not only about transfer of land
ownership to farmers and other qualified beneficiaries. It draws attention in this
regard to Sec. 3(a) of RA 6657 on the concept and scope of the term agrarian
reform. The constitutionality of a law, HLI added, cannot, as here, be attacked
collaterally.
The instant challenge on the constitutionality of Sec. 31 of RA 6657 and
necessarily its counterpart provision in EO 229 must fail as explained below.
When the Court is called upon to exercise its power of judicial review over, and
pass upon the constitutionality of, acts of the executive or legislative
departments, it does so only when the following essential requirements are first
met, to wit:
(1) there is an actual case or controversy;
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(2) that the constitutional question is raised at the earliest possible
opportunity by a proper party or one with locus standi; and
(3) the issue of constitutionality must be the very lis mota of the case.[35]
[108]
Not all the foregoing requirements are satisfied in the case at bar.
While there is indeed an actual case or controversy, intervenor FARM, composed
of a small minority of 27 farmers, has yet to explain its failure to challenge the
constitutionality of Sec. 3l of RA 6657, since as early as November 21, l989 when
PARC approved the SDP of Hacienda Luisita or at least within a reasonable time
thereafter and why its members received benefits from the SDP without so much
of a protest. It was only on December 4, 2003 or 14 years after approval of the
SDP via PARC Resolution No. 89-12-2 dated November 21, 1989 that said plan
and approving resolution were sought to be revoked, but not, to stress, by FARM
or any of its members, but by petitioner AMBALA. Furthermore, the AMBALA
petition did NOT question the constitutionality of Sec. 31 of RA 6657, but
concentrated on the purported flaws and gaps in the subsequent
implementation of the SDP. Even the public respondents, as represented by the
Solicitor General, did not question the constitutionality of the provision. On the
other hand, FARM, whose 27 members formerly belonged to AMBALA, raised the
constitutionality of Sec. 31 only on May 3, 2007 when it filed its Supplemental
Comment with the Court. Thus, it took FARM some eighteen (18) years from
November 21, 1989 before it challenged the constitutionality of Sec. 31 of RA
6657 which is quite too late in the day. The FARM members slept on their rights
and even accepted benefits from the SDP with nary a complaint on the alleged
unconstitutionality of Sec. 31 upon which the benefits were derived. The Court
cannot now be goaded into resolving a constitutional issue that FARM failed to
assail after the lapse of a long period of time and the occurrence of numerous
events and activities which resulted from the application of an alleged
unconstitutional legal provision.
It has been emphasized in a number of cases that the question of
constitutionality will not be passed upon by the Court unless it is properly raised
and presented in an appropriate case at the first opportunity.[36][109] FARM is,
therefore, remiss in belatedly questioning the constitutionality of Sec. 31 of RA
6657. The second requirement that the constitutional question should be raised
at the earliest possible opportunity is clearly wanting.
The last but the most important requisite that the constitutional issue must be
the very lis mota of the case does not likewise obtain. The lis mota aspect is not
Agrarian Reform Outline Reviewer - Atty. Capanas - AMaWS
present, the constitutional issue tendered not being critical to the resolution of
the case. The unyielding rule has been to avoid, whenever plausible, an issue
assailing the constitutionality of a statute or governmental act.[37][110] If some
other grounds exist by which judgment can be made without touching the
constitutionality of a law, such recourse is favored.[38][111] Garcia v. Executive
Secretary explains why:
Lis Mota the fourth requirement to satisfy before this Court will undertake
judicial review means that the Court will not pass upon a question of
unconstitutionality, although properly presented, if the case can be disposed of
on some other ground, such as the application of the statute or the general law.
The petitioner must be able to show that the case cannot be legally resolved
unless the constitutional question raised is determined. This requirement is
based on the rule that every law has in its favor the presumption of
constitutionality; to justify its nullification, there must be a clear and unequivocal
breach of the Constitution, and not one that is doubtful, speculative, or
argumentative.[39][112] (Italics in the original.)
The lis mota in this case, proceeding from the basic positions originally taken by
AMBALA (to which the FARM members previously belonged) and the Supervisory
Group, is the alleged non-compliance by HLI with the conditions of the SDP to
support a plea for its revocation. And before the Court, the lis mota is whether or
not PARC acted in grave abuse of discretion when it ordered the recall of the
SDP for such non-compliance and the fact that the SDP, as couched and
implemented, offends certain constitutional and statutory provisions. To be sure,
any of these key issues may be resolved without plunging into the
constitutionality of Sec. 31 of RA 6657. Moreover, looking deeply into the
underlying petitions of AMBALA, et al., it is not the said section per se that is
invalid, but rather it is the alleged application of the said provision in the SDP
that is flawed.
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