Association of Small Landowners in the Philippines vs.

Secretary of Agrarian Reform

Facts:

In this consolidated case, petitioners question the constitutionality of RA 6657, also known as the
Comprehensive Agrarian Reform Law and other related laws on grounds inter alia of separation of powers, due
process, equal protection, and the constitutional limitation that no private property shall be taken for public use
without just compensation. Petitioners are landowners who claim to be adversely affected by the mandatory
policy of land distribution to tenants.

Issue:

Is the Comprehensive Agrarian Reform Law constitutional?

Held:

Yes. The law is constitutional.

Petitioners had not shown any proof that they belong to a different class exempt from the agrarian reform
program; hence, there is no violation of the equal protection clause. Also, there is no violation of due process.
What is contemplated by law is that the just compensation determined by an administrative body is merely
preliminary. If the landowner does not agree with the finding of just compensation by an administrative body,
then it can go to court and the determination of the latter shall be the final determination. Further, the agrarian
reform program is a revolutionary exercise of eminent domain. The program will require billions of pesos in
funds if all compensation have to be made in cash – if everything is in cash, then the government will not have
sufficient money hence, bonds, and other securities, i.e., shares of stocks, may be used for just compensation. It
is a part of this assumption that when the framers of the Constitution envisioned the expropriation that would be
needed, they also intended that the just compensation would have to be paid not in the orthodox way but a less
conventional if more practical method.

LBP vs. Honeycomb Farms Corp.

Facts:

The LBP argues that the CA erred when it failed to apply the mandatory formula for determining just
compensation fixed in DAR AO No. 11, series of 1994. According to it, the just compensation for land taken for
agrarian reform should be less than the just compensation given in the ordinary exercise of eminent domain. In
contrast, Honeycomb Farms maintains that the DAR AOs were issued merely to serve as guidelines for the
DAR and the LBP in administratively fixing the valuation to be offered by the DAR to the landowner for
acceptance or rejection. In this case, Honeycomb Farms voluntarily offered two parcels of land, with a total area
of 495.1374 hectares, to the Department of Agrarian Reform (DAR) for coverage under Republic Act No. (RA)
6657, the Comprehensive Agrarian Reform Law (CARL), for P10,480,000.00, or P21,165.00 per hectare.

Issue:

Is the just compensation referred to in the law to be paid to the landowners for their parcels of agricultural land
less than the market value of the property? Is the application of the DAR formula mandatory?

Held:

No. When the State exercises its inherent power of eminent domain, the Constitution imposes the corresponding
obligation to compensate the landowner for the expropriated property. The compensation mentioned here
pertains to the fair and full price of the taken property. Further, previous rulings plainly impose on the RTC the
duty to apply the formula laid down in the pertinent DAR administrative regulations to determine just
compensation.
Luz Farms vs. Secretary of Agrarian Reform

Facts:

Petitioner, a corporation engaged in the livestock and poultry business, questions certain provisions of RA 6657
insofar as it includes the raising of livestock, poultry and swine in its coverage. Respondent argues that
livestock and poultry raising is embraced in the term "agriculture" and the inclusion of such enterprise under the
law is proper.

Issue:

Is the raising of livestock, poultry and swine covered by RA 6657?

Held:

No. The transcripts of the deliberations of the Constitutional Commission of 1986 on the meaning of the word
"agricultural," clearly show that it was never the intention of the framers of the Constitution to include livestock
and poultry industry in the coverage of the constitutionally-mandated agrarian reform program of the
Government. The Committee adopted the definition of "agricultural land" as defined under Section 166 of R.A.
3844, as land devoted to any growth, including but not limited to crop lands, saltbeds, fishponds, idle and
abandoned land. The intention of the Committee is to limit the application of the word "agriculture."

Natalia Realty Inc. vs. Department of Agrarian Reform

Facts:

Petitioner Natalia Realty, Inc. (NATALIA, for brevity) is the owner of three (3) contiguous parcels of land
located in Banaba, Antipolo, Rizal, with areas of 120.9793 hectares, 1.3205 hectares and 2.7080 hectares, or a
total of 125.0078 hectares, and embraced in Transfer Certificate of Title No. 31527 of the Register of Deeds of
the Province of Rizal. The NATALIA properties are situated within the areas proclaimed as townsite reservation
by the President. Since private landowners were allowed to develop their properties into low-cost housing
subdivisions within the reservation, petitioner applied for and was granted the necessary permit for its Antipolo
Hills Subdivision. RA 6657 took effect and included some undeveloped portions of the Antipolo Hills
Subdivision.

Issue:

Is the portion of the subject property covered by RA 6657?

Held:

No. Lands not devoted to agricultural activity are outside the coverage of CARL. These include lands
previously converted to non-agricultural uses prior to the effectivity of CARL by government agencies other
than respondent DAR.