ROXAS V DAMBA-NFSW

The main subject of the seven consolidated petitions is the application of petitioner Roxas & Co., Inc. (Roxas &
Co.) for conversion from agricultural to non-agricultural use of its three haciendas located in Nasugbu, Batangas containing
a total area of almost 3,000 hectares. The facts are not new, the Court having earlier resolved intimately-related issues
dealing with these haciendas. Thus, in the 1999 case of Roxas & Co., Inc. v. Court of Appeals,[1] the Court presented the
facts as follows:

. . . Roxas & Co. is a domestic corporation and is the registered owner of three haciendas,
namely, Haciendas Palico, Banilad and Caylaway, all located in the Municipality of Nasugbu,
Batangas. Hacienda Palico is 1,024 hectares in area and is registered under Transfer Certificate of Title
(TCT) No. 985. This land is covered by Tax Declaration Nos. 0465, 0466, 0468, 0470, 0234 and
0354. Hacienda Banilad is 1,050 hectares in area, registered under TCT No. 924 and covered by Tax
Declaration Nos. 0236, 0237 and 0390. Hacienda Caylaway is 867.4571 hectares in area and is
registered under TCT Nos. T-44662, T-44663, T-44664 and T-44665.

xxxx

On July 27, 1987, the Congress of the Philippines formally convened and took over legislative
power from the President. This Congress passed Republic Act No. 6657, the Comprehensive Agrarian
Reform Law (CARL) of 1988. The Act was signed by the President on June 10, 1988 and took effect
on June 15, 1988.

Before the laws effectivity, on May 6, 1988, [Roxas & Co.] filed with respondent DAR
a voluntary offer to sell [VOS] Hacienda Caylaway pursuant to the provisions of E.O. No.
229. Haciendas Palico and Banilad were later placed under compulsory acquisition by DAR in
accordance with the CARL.

xxxx

Nevertheless, on August 6, 1992, [Roxas & Co.], through its President, Eduardo J. Roxas, sent
a letter to the Secretary of DAR withdrawing its VOS of Hacienda Caylaway. The Sangguniang
Bayan of Nasugbu, Batangas allegedly authorized the reclassification of Hacienda Caylaway from
agricultural to non-agricultural. As a result, petitioner informed respondent DAR that it was applying
for conversion of Hacienda Caylaway from agricultural to other uses.

x x x x[2] (emphasis and underscoring supplied)

The petitions in G.R. Nos. 167540 and 167543 nub on the interpretation of Presidential
Proclamation (PP) 1520 which was issued on November 28, 1975 by then President Ferdinand
Marcos. The PP reads:
DECLARING THE MUNICIPALITIES OF MARAGONDON
AND TERNATE IN CAVITE PROVINCE AND THE MUNICIPALITY OF NASUGBU IN
BATANGAS AS A TOURIST ZONE, AND FOR OTHER PURPOSES

WHEREAS, certain areas in the sector comprising the Municipalities of Maragondon and
Ternate in Cavite Province and Nasugbu in Batangas have potential tourism value after being
developed into resort complexes for the foreign and domestic market; and

WHEREAS, it is necessary to conduct the necessary studies and to segregate specific

geographic areas for concentrated efforts of both the government and private sectors in developing
their tourism potential;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of

the powers vested in me by the Constitution, do hereby declare the area comprising the Municipalities
of Maragondon and Ternate in Cavite Province and Nasugbu in Batangas Province as a tourist zone
under the administration and control of the Philippine Tourism Authority (PTA) pursuant to
Section 5 (D) of P.D. 564.

The PTA shall identify well-defined geographic areas within the zone with potential
tourism value, wherein optimum use of natural assets and attractions, as well as existing facilities and
concentration of efforts and limited resources of both government and private sector may be affected
and realized in order to generate foreign exchange as well as other tourist receipts.

Any duly established military reservation existing within the zone shall be excluded from this
proclamation.

All proclamation, decrees or executive orders inconsistent herewith are hereby revoked or
modified accordingly. (emphasis and underscoring supplied).
 The incidents which spawned the filing of the petitions in G.R. Nos. 149548, 167505, 167845,
169163 and 179650 are stated in the dissenting opinion of Justice Minita Chico-Nazario, the original draft of which was
made the basis of the Courts deliberations.
Essentially, Roxas & Co. filed its application for conversion of its three haciendas from argricultural to non-
agricultural on the assumption that the issuance of PP 1520 which declared Nasugbu, Batangas as a tourism zone,
reclassified them to non-agricultural uses. Its pending application notwithstanding, the Department of Agrarian Reform
(DAR) issued Certificates of Land Ownership Award (CLOAs) to the farmer-beneficiaries in the
three haciendas including CLOA No. 6654 which was issued on October 15, 1993 covering 513.983 hectares, the subject
of G.R. No. 167505.

The application for conversion of Roxas & Co. was the subject of the above-stated Roxas & Co., Inc. v. Court of
Appeals which the Court remanded to the DAR for the observance of proper acquisition proceedings. As reflected in the
above-quoted statement of facts in said case, during the pendency before the DAR of its application for conversion following
its remand to the DAR or on May 16, 2000, Roxas & Co. filed with the DAR an application for exemption from the coverage
of the Comprehensive Agrarian Reform Program (CARP) of 1988 on the basis of PP 1520 and of DAR Administrative
Order (AO) No. 6, Series of 1994[3] which states that all lands already classified as commercial, industrial, or residential
before the effectivity of CARP no longer need conversion clearance from the DAR.

It bears mentioning at this juncture that on April 18, 1982, the Sangguniang Bayan of Nasugbu enacted Municipal
Zoning Ordinance No. 4 (Nasugbu MZO No. 4) which was approved on May 4, 1983 by the Human Settlements Regulation
Commission, now the Housing and Land Use Regulatory Board (HLURB).
The records show that Sangguniang Bayan and Association of Barangay Captains of Nasugbu filed before this
Court petitions for intervention which were, however, denied by Resolution of June 5, 2006 for lack of standing.[4]

After the seven present petitions were consolidated and referred to the Court en banc,[5] oral arguments were
conducted on July 7, 2009.

The core issues are:

1. Whether PP 1520 reclassified in 1975 all lands in the Maragondon-Ternate-Nasugbu tourism zone to non-
agricultural use to exempt Roxas & Co.s three haciendas in Nasugbu from CARP coverage;
2. Whether Nasugbu MSO No. 4, Series of 1982 exempted certain lots in Hacienda Palico from CARP coverage;
and

3. Whether the partial and complete cancellations by the DAR of CLOA No. 6654 subject of G.R. No. 167505 is
valid.

The Court shall discuss the issues in seriatim.

I. PP 1520 DID NOT AUTOMATICALLY CONVERT THE AGRICULTURAL LANDS IN THE THREE
MUNICIPALITIES INCLUDING NASUGBU TO NON-AGRICULTURAL LANDS.

Roxas & Co. contends that PP 1520 declared the three municipalities as each constituting a tourism zone,
reclassified all lands therein to tourism and, therefore, converted their use to non-agricultural purposes.

To determine the chief intent of PP 1520, reference to the whereas clauses is in order. By and large, a reference to the
congressional deliberation records would provide guidance in dissecting the intent of legislation. But since PP 1520
emanated from the legislative powers of then President Marcos during martial rule, reference to the whereas clausescannot
be dispensed with.[6]

The perambulatory clauses of PP 1520 identified only certain areas in the sector comprising the [three
Municipalities that] have potential tourism value and mandated the conduct of necessary studies and the segregation of
specific geographic areas to achieve its purpose. Which is why the PP directed the Philippine Tourism Authority (PTA) to
identify what those potential tourism areas are. If all the lands in those tourism zones were to be wholly converted to non-
agricultural use, there would have been no need for the PP to direct the PTA to identify what those specific geographic areas
are.

The Court had in fact passed upon a similar matter before. Thus in DAR v. Franco,[7] it pronounced:

Thus, the DAR Regional Office VII, in coordination with the Philippine Tourism Authority,
has to determine precisely which areas are for tourism development and excluded from the
Operation Land Transfer and the Comprehensive Agrarian Reform Program. And suffice it to state here
that the Court has repeatedly ruled that lands already classified as non-agricultural before the enactment
 of RA 6657 on 15 June 1988 do not need any conversion clearance.[8] (emphasis and underscoring
supplied).

While the above pronouncement in Franco is an obiter, it should not be ignored in the resolution of the present petitions
since it reflects a more rational and just interpretation of PP 1520. There is no prohibition in embracing the rationale of
an obiter dictum in settling controversies, or in considering related proclamations establishing tourism zones.

In the above-cited case of Roxas & Co. v. CA,[9] the Court made it clear that the power to determine whether Haciendas
Palico, Banilad and Caylaway are non-agricultural, hence, exempt from the coverage of the [Comprehensive Agrarian
Reform Law] lies with the [Department of Agrarian Reform], not with this Court.[10] The DAR, an administrative body of
special competence, denied, by Order of October 22, 2001, the application for CARP exemption of Roxas & Co., it finding
that PP 1520 did not automatically reclassify all the lands in the affected municipalities from their original uses. It appears
that the PTA had not yet, at that time, identified the specific geographic areas for tourism development and had no pending
tourism development projects in the areas. Further, report from the Center for Land Use Policy Planning and Implementation
(CLUPPI) indicated that the areas were planted with sugar cane and other crops.[11]

Relatedly, the DAR, by Memorandum Circular No. 7, Series of 2004,[12] came up with clarificatory guidelines and therein
decreed that

A. x x x x.

B. Proclamations declaring general areas such as whole provinces, municipalities, barangays,

islands or peninsulas as tourist zones that merely:

(1) recognize certain still unidentified areas within the covered provinces, municipalities,
barangays, islands, or peninsulas to be with potential tourism value and charge the Philippine Tourism
Authority with the task to identify/delineate specific geographic areas within the zone with potential
tourism value and to coordinate said areas development; or

(2) recognize the potential value of identified spots located within the general area declared as
tourist zone (i.e. x x x x) and direct the Philippine Tourism Authority to coordinate said areas
development;

could not be regarded as effecting an automatic reclassification of the entirety of the land area
declared as tourist zone. This is so because reclassification of lands denotes their allocation into
some specific use and providing for the manner of their utilization and disposition (Sec. 20, Local
Government Code) or the act of specifying how agricultural lands shall be utilized for non-
agricultural uses such as residential, industrial, or commercial, as embodied in the land use
plan. (Joint HLURB, DAR, DA, DILG Memo. Circular Prescribing Guidelines for MC 54, S. 1995,
Sec.2)

A proclamation that merely recognizes the potential tourism value of certain areas within the
general area declared as tourist zone clearly does not allocate, reserve, or intend the entirety of the
land area of the zone for non-agricultural purposes. Neither does said proclamation direct that
otherwise CARPable lands within the zone shall already be used for purposes other than
agricultural.

Moreover, to view these kinds of proclamation as a reclassification for non-agricultural purposes of entire
provinces, municipalities, barangays, islands, or peninsulas would be unreasonable as it amounts to an
automatic and sweeping exemption from CARP in the name of tourism development. The same would
also undermine the land use reclassification powers vested in local government units in conjunction with
pertinent agencies of government.

C. There being no reclassification, it is clear that said proclamations/issuances, assuming

[these] took effect before June 15, 1988, could not supply a basis for exemption of the entirety of
the lands embraced therein from CARP coverage x x x x.

D. x x x x. (underscoring in the original; emphasis and italics supplied)

The DARs reading into these general proclamations of tourism zones deserves utmost consideration, more
especially in the present petitions which involve vast tracts of agricultural land. To reiterate, PP 1520 merely recognized the
potential tourism value of certain areas within the general area declared as tourism zones. It did not reclassify the areas to
non-agricultural use.

Apart from PP 1520, there are similarly worded proclamations declaring the whole of Ilocos Norte
and Bataan Provinces, Camiguin, Puerto Prinsesa, Siquijor, PanglaoIsland, parts of Cebu City and Municipalities of Argao
and Dalaguete in Cebu Province as tourism zones.[13]
 Indubitably, these proclamations, particularly those pertaining to the Provinces of Ilocos Norte and Bataan, did not
intend to reclassify all agricultural lands into non-agricultural lands in one fell swoop. The Court takes notice of how the
agrarian reform program wasand still isimplemented in these provinces since there are lands that do not have any tourism
potential and are more appropriate for agricultural utilization.

Relatedly, a reference to the Special Economic Zone Act of 1995[14] provides a parallel orientation on the
issue. Under said Act, several towns and cities encompassing the whole Philippines were readily identified as economic
zones.[15] To uphold Roxas & Co.s reading of PP 1520 would see a total reclassification of practically all the agricultural
lands in the country to non-agricultural use. Propitiously, the legislature had the foresight to include a bailout provision in
Section 31 of said Act for land conversion.[16] The same cannot be said of PP 1520, despite the existence of Presidential
Decree (PD) No. 27 or the Tenant Emancipation Decree,[17] which is the precursor of the CARP.

Interestingly, then President Marcos also issued on September 26, 1972 PD No. 2 which declared
the entire Philippines as land reform area.[18] Such declaration did not intend to reclassify all lands in the entire country to
agricultural lands. President Marcos, about a month later or on October 21, 1972, issued PD 27 which decreed that all private
agricultural lands primarily devoted to rice and corn were deemed awarded to their tenant-farmers.

Given these martial law-era decrees and considering the socio-political backdrop at the time PP 1520 was issued in
1975, it is inconceivable that PP 1520, as well as other similarly worded proclamations which are completely silent on the
aspect of reclassification of the lands in those tourism zones, would nullify the gains already then achieved by PD 27.

Even so, Roxas & Co. turns to Natalia Realty v. DAR and NHA v. Allarde to support its position. These cases are
not even closely similar to the petitions in G.R. Nos. 167540 and 167543. The only time that these cases may find application
to said petitions is when the PTA actually identifies well-defined geographic areas within the zone with potential tourism
value.

In remotely tying these two immediately-cited cases that involve specific and defined townsite reservations for the
housing program of the National Housing Authority to the present petitions, Roxas & Co. cites Letter of Instructions No.
352 issued on December 22, 1975 which states that the survey and technical description of the tourism zones shall be
considered an integral part of PP 1520. There were, however, at the time no surveys and technical delineations yet of the
intended tourism areas.

On hindsight, Natalia and Allarde find application in the petitions in G.R. Nos. 179650 & 167505, which petitions
are anchored on the extenuating effects of Nasugbu MZO No. 4, but not in the petitions in G.R. Nos. 167540 & 167543
bearing on PP 1520, as will later be discussed.

Of significance also in the present petitions is the issuance on August 3, 2007 of Executive Order No. 647[19] by
President Arroyo which proclaimed the areas in the Nasugbu Tourism Development Plan as Special Tourism Zone. Pursuant
to said Executive Order, the PTA completed its validation of 21 out of 42 barangays as tourism priority areas, hence, it is
only after such completion that these identified lands may be subjected to reclassification proceedings.

It bears emphasis that a mere reclassification of an agricultural land does not automatically allow a landowner to
change its use since there is still that process of conversion before one is permitted to use it for other purposes.[20]
Tourism Act, and not to PP 1520, for possible exemption.
II. ROXAS & CO.S APPLICATION IN DAR ADMINISTRATIVE CASE NO. A-9999-142-97 FOR CARP
EXEMPTION IN HACIENDA PALICO SUBJECT OF G.R. NO. 179650 CANNOT BE GRANTED IN
VIEW OF DISCREPANCIES IN THE LOCATION AND IDENTITY OF THE SUBJECT PARCELS OF
LAND.

Since PP 1520 did not automatically convert Haciendas Caylaway, Banilad and Palico into non-agricultural
estates, can Roxas & Co. invoke in the alternative Nasugbu MZO No. 4, which reclassified in 1982 the haciendas to non-
agricultural use to exclude six parcels of land in Hacienda Palico from CARP coverage?

By Roxas & Co.s contention, the affected six parcels of land which are the subject of DAR Administrative Case
No. A-9999-142-97 and nine parcels of land which are the subject of DAR Administrative Case No. A-9999-008-98
involved in G.R. No. 167505, all in Hacienda Palico, have been reclassified to non-agricultural uses via Nasugbu MZO No.
4 which was approved by the forerunner of HLURB.

Roxas & Co.s contention fails.

To be sure, the Court had on several occasions decreed that a local government unit has the power to classify and
convert land from agricultural to non-agricultural prior to the effectivity of the CARL.[23] In Agrarian Reform Beneficiaries
Association v. Nicolas,[24] it reiterated that

. . . the facts obtaining in this case are similar to those in Natalia Realty. Both subject lands form
part of an area designated for non-agricultural purposes. Both were classified as non-agricultural
lands prior to June 15, 1988, the date of effectivity of CARL.
 xxxx

In the case under review, the subject parcels of lands were reclassified within an urban zone as
per approved Official Comprehensive Zoning Map of the City of Davao. The reclassification was
embodied in City Ordinance No. 363, Series of 1982. As such, the subject parcels of land are
considered non-agricultural and may be utilized for residential, commercial, and industrial
purposes. The reclassification was later approved by the HLURB.[25] (emphasis, italics and
underscoring supplied)

The DAR Secretary[26] denied the application for exemption of Roxas & Co., however, in this wise:

Initially, CLUPPI-2 based [its] evaluation on the lot nos. as appearing in CLOA No.
6654. However, for purposes of clarity and to ensure that the area applied for exemption is indeed part
of TCT No. T-60034, CLUPPI-2 sought to clarify with [Roxas & Co.] the origin of TCT No. T-
60034. In a letter dated May 28, 1998, [Roxas & Co.] explains that portions of TCT No. T-985, the
mother title, was subdivided into 125 lots pursuant to PD 27. A total of 947.8417 was retained by the
landowners and was subsequently registered under TCT No. 49946. [[Roxas & Co.] further explains
that TCT No. 49946 was further subdivided into several lots (Lot 125-A to Lot 125-P) with Lot No.
125-N registered under TCT No. 60034. [A] review of the titles, however, shows that the origin of
T-49946 is T-783 and not T-985. On the other hand, the origin of T-60034 is listed as 59946, and
not T-49946. The discrepancies were attributed by [Roxas & Co.] to typographical errors which
were acknowledged and initialled [sic] by the ROD. Per verification, the discrepancies . . . cannot
be ascertained.[27] (emphasis and underscoring supplied)

In denying Roxas & Co.s motion for reconsideration, the DAR Secretary held:

The landholdings covered by the aforesaid titles do not correspond to the Certification
dated February 11, 1998 of the [HLURB] , the Certification dated September 12, 1996 issued by
the Municipal Planning and Development Coordinator, and the Certifications dated July 31, 1997
and May 27, 1997 issued by the National Irrigation Authority.The certifications were issued for Lot
Nos. 21, 24, 28, 31, 32 and 34. Thus, it was not even possible to issue exemption clearance over the
lots covered by TCT Nos. 60019 to 60023.

Furthermore, we also note the discrepancies between the certifications issued by the
HLURB and the Municipal Planning Development Coordinator as to the area of the specific
lots.[28] (emphasis and underscoring supplied)

In affirming the DAR Secretarys denial of Roxas & Co.s application for exemption, the Court of Appeals, in CA-
G.R. SP No. 63146 subject of G.R. No. 179650, observed:

In the instant case, a perusal of the documents before us shows that there is no indication that
the said TCTs refer to the same properties applied for exemption by [Roxas & Co.] It is true that the
certifications refer, among others, to DAR Lot Nos. 21, 24, 28, 31, 32 and 34But these certifications
contain nothing to show that these lots are the same as Lots 125-A, 125-B, 125-C, 125-D and 125-
E covered by TCT Nos. 60019, 60020, 60021, 60022 and 60023, respetively. While [Roxas & Co.]
claims that DAR Lot Nos. 21, 24 and 31 correspond to the aforementioned TCTs submitted to the
DAR no evidence was presented to substantiate such allegation.

Moreover, [Roxas & Co.] failed to submit TCT 634 which it claims covers DAR Lot Nos.
28, 32 and 24.(TSN, April 24, 2001, pp. 43-44)

xxxx

[Roxas & Co.] also claims that subject properties are located at Barangay Cogunan and
Lumbangan and that these properties are part of the zone classified as Industrial under Municipal
Ordinance No. 4, Series of 1982 of the Municipality of Nasugbu, Batangas. .a scrutiny of the said
Ordinance shows that only Barangays Talangan and Lumbangan of the said municipality were
classified as Industrial ZonesBarangay Cogunan was not included. x x x x. In fact, the TCTs
submitted by [Roxas & Co.] show that the properties covered by said titles are all located at Barrio
Lumbangan.[29] (emphasis and underscoring supplied)

Its foregoing findings notwithstanding, the appellate court still allowed Roxas & Co. to adduce additional evidence to
support its application for exemption under Nasugbu MZO No. 4.
 Meanwhile, Roxas & Co. appealed the appellate courts decision in CA-G.R. No. SP No. 63146 affirming the DAR
Secretarys denial of its application for CARP exemption in Hacienda Palico (now the subject of G.R. No. 149548).

When Roxas & Co. sought the re-opening of the proceedings in DAR Administrative Case No. A-9999-142-97
(subject of G.R. No. 179650), and offered additional evidence in support of its application for CARP exemption, the DAR
Secretary, this time, granted its application for the six lots including Lot No. 36 since the additional documents offered by
Roxas & Co. mentioned the said lot.

In granting the application, the DAR Secretary[30] examined anew the evidence submitted by Roxas & Co. which
consisted mainly of certifications from various local and national government agencies.[31] Petitioner in G.R. Nos. 167505,
167540, 169163 and 179650, Damayan Ng Mga Manggagawang Bukid Sa Asyenda Roxas-National Federation of Sugar
Workers (DAMBA-NFSW), the organization of the farmer-beneficiaries, moved to have the grant of the application
reconsidered but the same was denied by the DAR by Order of December 12, 2003, hence, it filed a petition
for certiorari before the Court of Appeals, docketed as CA-G.R. SP No. 82225, on grounds of forum-shopping and grave
abuse of discretion. The appellate court, by Decision of October 31, 2006, ruled that DAMBA-NFSW availed of the wrong
mode of appeal. At all events, it dismissed its petition as it upheld the DAR Secretarys ruling that Roxas & Co. did not
commit forum-shopping, hence, the petition of DAMBA-NGSW in G.R. No. 179650.

While ordinarily findings of facts of quasi-judicial agencies are generally accorded great weight and even finality
by the Court if supported by substantial evidence in recognition of their expertise on the specific matters under their
consideration,[32] this legal precept cannot be made to apply in G.R. No. 179650.

Even as the existence and validity of Nasugbu MZO No. 4 had already been established, there remains in dispute
the issue of whether the parcels of land involved in DAR Administrative Case No. A-9999-142-97 subject of G.R. No.
179650 are actually within the said zoning ordinance.

The Court finds that the DAR Secretary indeed committed grave abuse of discretion when he ignored the glaring
inconsistencies in the certifications submitted early on by Roxas & Co. in support of its application vis--vis the certifications
it later submitted when the DAR Secretary reopened DAR Administrative Case No. A-9999-142-97.

Notably, then DAR Secretary Horacio Morales, on one hand, observed that the landholdings covered by the
aforesaid titles do not correspond to the Certification dated February 11, 1998 of the [HLURB], the Certification dated
September 12, 1996 issued by the Municipal Planning and Development Coordinator, and the Certifications dated July 31,
1997 and May 27, 1997 issued by the National Irrigation Authority. On the other hand, then Secretary Hernani Braganza
relied on a different set of certifications which were issued later or on September 19, 1996.

In this regard, the Court finds in order the observation of DAMBA-NFSW that Roxas & Co. should have submitted
the comprehensive land use plan and pointed therein the exact locations of the properties to prove that indeed they are within
the area of coverage of Nasugbu MZO No. 4.

The petitions in G.R. Nos. 179650 & 149548 must be distinguished from Junio v. Garilao[33] wherein the
certifications submitted in support of the application for exemption of the therein subject lot were mainly considered on the
presumption of regularity in their issuance, there being no doubt on the location and identity of the subject lot.[34] In G.R.
No. 179650, there exist uncertainties on the location and identities of the properties being applied for exemption.

G.R. No. 179650 & G.R. No. 149548 must accordingly be denied for lack of merit.

III. ROXAS & CO.S APPLICATION FOR CARP EXEMPTION IN DAR ADMINISTRATIVE CASE NO. A-9999-
008-98 FOR THE NINE PARCELS OF LAND IN HACIENDA PALICO SUBJECT OF G.R. NO.
167505 SHOULD BE GRANTED.

The Court, however, takes a different stance with respect to Roxas & Co.s application for CARP exemption in DAR
Administrative Case No. A-9999-008-98 over nineparcels of land identified as Lot Nos. 20, 13, 37, 19-B, 45, 47, 49, 48-1
and 48-2 which are portions of TCT No. 985 covering 45.9771 hectares in Hacienda Palico, subject of G.R. No. 167505.

In its application, Roxas & Co. submitted the following documents:

1. Letter-application dated 29 September 1997 signed by Elino SJ. Napigkit, for and on
behalf of Roxas & Company, Inc., seeking exemption from CARP coverage of subject
landholdings;

2. Secretarys Certificate dated September 2002 executed by Mariano M. Ampil III,

Corporate Secretary of Roxas & Company, Inc., indicating a Board Resolution authorizing
him to represent the corporation in its application for exemption with the DAR. The same
 Board Resolution revoked the authorization previously granted to the Sierra Management
& Resources Corporation;

3. Photocopy of TCT No. 985 and its corresponding Tax Declaration No. 0401;

4. Location and vicinity maps of subject landholdings;

5. Certification dated 10 July 1997 issued by Reynaldo Garcia, Municipal Planning

and Development Coordinator (MPDC) and Zoning Administrator of Nasugbu,
Batangas, stating that the subject parcels of land are within the Urban Core Zone as
specified in Zone A. VII of Municipal Zoning Ordinance No. 4, Series of 1982,
approved by the Human Settlements Regulatory Commission (HSRC), now the Housing
and Land Use Regulatory Board (HLURB), under Resolution No. 123, Series of 1983,
dated 4 May 1983;

6. Two (2) Certifications both dated 31 August 1998, issued by Alfredo Tan II,
Director, HLURB, Region IV, stating that the subject parcels of land appear to be
within the Residential cluster Area as specified in Zone VII of Municipal Zoning
Ordinance No. 4, Series of 1982, approved under HSRC Resolution No. 123, Series of
1983, dated 4 May 1983;[35]

x x x x (emphasis and underscoring supplied)

By Order of November 6, 2002, the DAR Secretary granted the application for exemption but issued 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.[36]

DAMBA-NSFW moved for reconsideration but the DAR Secretary denied the same and explained further why
CLOA holders need not be informed of the pending application for exemption in this wise:

As regards the first ground raised by [DAMBA-NSFW], it should be remembered that

an application for CARP-exemption pursuant to DOJ Opinion No. 44, series of 1990, as
implemented by DAR Administrative Order No. 6, series of 1994, is non-adversarial or non-
litigious in nature. Hence, applicant is correct in saying that nowhere in the rules is it required
that occupants of a landholding should be notified of an initiated or pending exemption
application.

xxxx

With regard [to] the allegation that oppositors-movants are already CLOA holders of
subject propert[ies] and deserve to be notified, as owners, of the initiated questioned exemption
application, is of no moment. The Supreme Court in the case of Roxas [&] Co., Inc. v. Court
of Appeals, 321 SCRA 106, held:
We stress that the failure of respondent DAR to comply with the requisites of due
process in the acquisition proceedings does not give this Court the power to nullify the CLOAs
already issued to the farmer beneficiaries. x x x x. Anyhow, the farmer[-]beneficiaries hold the
property in trust for the rightful owner of the land.

Since subject landholding has been validly determined to be CARP-exempt, therefore,

the previous issuance of the CLOA of oppositors-movants is erroneous. Hence, similar to the
situation of the above-quoted Supreme Court Decision, oppositors-movants only hold the
property in trust for the rightful owners of the land and are not the owners of subject
 landholding who should be notified of the exemption application of applicant Roxas &
Company, Incorporated.

Finally, this Office finds no substantial basis to reverse the assailed Orders since there
is substantial compliance by the applicant with the requirements for the issuance of exemption
clearance under DAR AO 6 (1994).[37]

On DAMBA-NSFWs petition for certiorari, the Court of Appeals, noting that the petition was belatedly filed, sustained, by
Decision of December 20, 1994 and Resolution of May 7, 2007,[38] the DAR Secretarys finding that Roxas & Co. had
substantially complied with the prerequisites of DAR AO 6, Series of 1994. Hence, DAMBA-NFSWs petition in G.R. No.
167505.

The Court finds no reversible error in the Court of Appeals assailed issuances, the orders of the DAR Secretary
which it sustained being amply supported by evidence.

IV. THE CLOAs ISSUED BY THE DAR in ADMINISTRATIVE CASE NO. A-9999-008-98 SUBJECT OF G.R. No.
179650 TO THE FARMER-BENEFICIARIES INVOLVING THE NINE PARCELS OF LAND IN
HACIENDA PALICO MUST BE CANCELLED.

Turning now to the validity of the issuance of CLOAs in Hacienda Palico vis--vis the present dispositions: It bears
recalling that in DAR Administrative Case Nos. A-9999-008-98 and A-9999-142-97 (G.R. No. 179650), the Court ruled for
Roxas & Co.s grant of exemption in DAR Administrative Case No. A-9999-008-98 but denied the grant of exemption in
DAR Administrative Case No. A-9999-142-97 for reasons already discussed. It follows that the CLOAs issued to the
farmer-beneficiaries in DAR Administrative Case No. A-9999-008-98 must be cancelled.

But first, the Court digresses. The assertion of DAMBA-NSFW that the petitions for partial and complete
cancellations of the CLOAs subject of DARAB Case Nos. R-401-003-2001 to R-401-005-2001 and No. 401-239-2001
violated the earlier order in Roxas v. Court of Appeals does not lie. Nowhere did the Court therein pronounce that the
CLOAs issued cannot and should not be cancelled, what was involved therein being the legality of the acquisition
proceedings. The Court merely reiterated that it is the DAR which has primary jurisdiction to rule on the validity of
CLOAs. Thus it held:

. . . [t]he failure of respondent DAR to comply with the requisites of due process in the
acquisition proceedings does not give this Court the power to nullify the [CLOAs] already issued to the
farmer-beneficiaries. To assume the power is to short-circuit the administrative process, which has yet
to run its regular course. Respondent DAR must be given the chance to correct its procedural lapses in
the acquisition proceedings. x x x x. Anyhow, the farmer beneficiaries hold the property in trust for the
rightful owner of the land.[39]

On the procedural question raised by Roxas & Co. on the appellate courts relaxation of the rules by giving due
course to DAMBA-NFSWs appeal in CA G.R. SP No. 72198, the subject of G.R. No. 167845:

Indeed, the perfection of an appeal within the statutory period is jurisdictional and failure to do so renders the
assailed decision final and executory.[40] A relaxation of the rules may, however, for meritorious reasons, be allowed in the
interest of justice.[41] The Court finds that in giving due course to DAMBA-NSFWs appeal, the appellate court committed
no reversible error. Consider its ratiocination:

x x x x. To deny [DAMBA-NSFW]s appeal with the PARAD will not only affect their right
over the parcel of land subject of this petition with an area of 103.1436 hectares, but also that of the
whole area covered by CLOA No. 6654 since the PARAD rendered a Joint Resolution of the Motion
for Reconsideration filed by the [DAMBA-NSFW] with regard to [Roxas & Co.]s application for partial
and total cancellation of the CLOA in DARAB Cases No. R-401-003-2001 to R-401-005-2001 and No.
401-239-2001. There is a pressing need for an extensive discussion of the issues as raised by both parties
as the matter of canceling CLOA No. 6654 is of utmost importance, involving as it does the probable
displacement of hundreds of farmer-beneficiaries and their families. x x x x (underscoring supplied)

Unlike courts of justice, the DARAB, as a quasi-judicial body, is not bound to strictly observe rules of procedure
and evidence. To strictly enforce rules on appeals in this case would render to naught the Courts dispositions on the other
issues in these consolidated petitions.
In the main, there is no logical recourse except to cancel the CLOAs issued for the nine parcels of land identified
as Lot Nos. 20, 13, 37, 19-B, 45, 47, 49, 48-1 and 48-2 which are portions of TCT No. 985 covering 45.9771 hectares
in Hacienda Palico (or those covered by DAR Administrative Case No. A-9999-008-98). As for the rest of the CLOAs,
they should be respected since Roxas & Co., as shown in the discussion in G.R. Nos. 167540, 167543 and 167505, failed
to prove that the other lots in Hacienda Palicoand the other two haciendas, aside from the above-mentioned nine lots, are
CARP-exempt.

Conformably, Republic Act No. 3844 (R.A. No. 3844), as amended,[42] mandates that disturbance compensation be
given to tenants of parcels of land upon finding that (t)he landholding is declared by the department head upon
recommendation of the National Planning Commission to be suited for residential, commercial, industrial or some other
urban purposes.[43] In addition, DAR AO No. 6, Series of 1994 directs the payment of disturbance compensation before the
application for exemption may be completely granted.

Roxas & Co. is thus mandated to first satisfy the disturbance compensation of affected farmer-beneficiaries in the
areas covered by the nine parcels of lands in DAR AO No. A-9999-008-98 before the CLOAs covering them can be
cancelled. And it is enjoined to strictly follow the instructions of R.A. No. 3844.

Finally then, and in view of the Courts dispositions in G.R. Nos. 179650 and 167505, the May 27, 2001 Decision
of the Provincial Agrarian Reform Adjudicator (PARAD)[44] in DARAB Case No. 401-239-2001 ordering the total
cancellation of CLOA No. 6654, subject of G.R. No. 169163, is SET ASIDE except with respect to the CLOAs issued
for Lot Nos. 20, 13, 37, 19-B, 45, 47, 49, 48-1 and 48-2 which are portions of TCT No. 985 covering 45.9771 hectares
in Hacienda Palico (or those covered by DAR Administrative Case No. A-9999-008-98). It goes without saying that
the motion for reconsideration of DAMBA-NFSW is granted to thus vacate the Courts October 19, 2005 Resolution
dismissing DAMBA-NFSWs petition for review of the appellate courts Decision in CA-G.R. SP No. 75952;[45]

WHEREFORE,

1) In G.R. No. 167540, the Court REVERSES and SETS ASIDE the November 24, 2003 Decision[46] and March
18, 2005 Resolution of the Court of Appeals in CA-G.R. SP No. 72131 which declared that Presidential Proclamation No.
1520 reclassified the lands in the municipalities of Nasugbu in Batangas and Maragondon and Ternate in Cavite to non-
agricultural use;

2) The Court accordingly GRANTS the Motion for Reconsideration of the Department of Agrarian Reform in G.R.
No. 167543 and REVERSES and SETS ASIDE its Resolution of July 20, 2005;
3) In G.R. No. 149548, the Court DENIES the petition for review of Roxas & Co. for lack of merit;

4) In G.R. No. 179650, the Court GRANTS the petition for review of DAMBA-NSFW
and REVERSES and SETS ASIDE the October 31, 2006 Decision and August 16, 2007 Resolution of the Court of
Appeals in CA-G.R. SP No. 82225;

5) In G.R. No. 167505, the Court DENIES the petition for review of DAMBA-NSFW
and AFFIRMS the December 20, 2004 Decision and March 7, 2005 Resolution of the Court of Appeals in CA-G.R. SP No.
82226;

6) In G.R. No. 167845, the Court DENIES Roxas & Co.s petition for review for lack of merit
and AFFIRMS the September 10, 2004 Decision and April 14, 2005Resolution of the Court of Appeals;

7) In G.R. No. 169163, the Court SETS ASIDE the Decisions of the Provincial Agrarian Reform Adjudicator in
DARAB Case No. 401-239-2001 ordering the cancellation of CLOA No. 6654 and DARAB Cases Nos. R-401-003-2001
to No. R-401-005-2001 granting the partial cancellation of CLOA No. 6654. The CLOAs issued for Lots No. 21 No. 24,
No. 26, No. 31, No. 32 and No. 34 or those covered by DAR Administrative Case No. A-9999-142-97) remain; and

8) Roxas & Co. is ORDERED to pay the disturbance compensation of affected farmer-beneficiaries in the areas
covered by the nine parcels of lands in DAR Administrative Case No. A-9999-008-98 before the CLOAs therein can be
cancelled, and is ENJOINED to strictly follow the mandate of R.A. No. 3844.
No pronouncement as to costs.
SO ORDERED.

ARTICLE XIX 2009 DARAB RULES OF PROCEDURE

RULE XIX
Preliminary Determination of Just Compensation
SECTION 1. Principal Role of Board/Adjudicator. — The principal role of the
Board/Adjudicator in the summary administrative proceedings for the preliminary determination of just
compensation is to determine whether the Land Bank of the Philippines (LBP) and the Department of
Agrarian Reform (DAR) in their land valuation computations have complied with the administrative orders
and other issuances of the Secretary of the DAR and the LBP.
SECTION 2. By Whom Conducted. — The preliminary proceedings of land valuation for the
purpose of the determination of just compensation for its acquisition shall be conducted: ICTaEH
 a. by the PARAD when the initial land valuation of the Land Bank of the Philippines (LBP)
is less than Ten Million Pesos (PhP10,000,000.00);
b. by the RARAD when the said valuation is Ten Million Pesos and above but less than
Fifty Million Pesos (PhP50,000,000.00); and
c. by the Board when the said valuation is Fifty Million Pesos (PhP50,000,000.00) and
above.
In the event of non-availability, inhibition or disqualification of a designated PARAD in the locality, the
RARAD concerned may conduct preliminary proceedings of land valuation notwithstanding that the
jurisdictional amount is less than Ten (10) Million Pesos.
On account of non-availability, inhibition or disqualification of the RARAD concerned, the Board may
conduct the preliminary proceedings of land valuation or designate the same to an Adjudicator from among
the PARADs in the region.
SECTION 3. Order for Submission of Evidence, Position Papers, and Notice of Hearing. —
Upon receipt of the Claim Folder (CF) containing all the pertinent documents, the Board/Adjudicator shall
issue an order:
a. to the landowner, the LBP, the DAR officials concerned, the farmer-beneficiaries and
other interested parties, that they may examine the claim folder in the Adjudicator's
possession and to submit evidence, pertinent documents, and their respective position papers
and affidavits within thirty (30) days from receipt of the order; and
b. notifying said parties of the date set for hearing on the matter.
Thereafter, the Board/Adjudicator shall proceed to make an administrative determination of just
compensation following the procedure in ordinary cases.
The Order shall be served in the same manner as the service of summons as provided for in Rule VII
hereof.
SECTION 4. Failure to Comply with Above Order. — If the parties fail to submit the required
documents and their position papers, and/or to appear on the date set for hearing, despite proper notice, the
matter shall be deemed submitted for resolution. ADETca
SECTION 5. When Resolution Deemed Final. — Failure on the part of the aggrieved party to
contest the resolution of the Board/Adjudicator within the afore-cited reglementary period provided shall be
deemed a concurrence by such party with the land valuation, hence said valuation shall become final and
executory.
SECTION 6. Filing of Original Action with the Special Agrarian Court for Final
Determination. — The party who disagrees with the decision of the Board/Adjudicator may contest the same
by filing an original action with the Special Agrarian Court (SAC) having jurisdiction over the subject property
within fifteen (15) days from his receipt of the Board/Adjudicator's decision.
Immediately upon filing with the SAC, the party shall file a Notice of Filing of Original Action with the
Board/Adjudicator, together with a certified true copy of the petition filed with the SAC.
Failure to file a Notice of Filing of Original Action or to submit a certified true copy of the petition shall
render the decision of the Board/Adjudicator final and executory. Upon receipt of the Notice of Filing of
Original Action or certified true copy of the petition filed with the SAC, no writ of execution shall be issued by
the Board/Adjudicator.
SECTION 7. Notice of Resolution. — A copy of the resolution of the Board/Adjudicator shall
be sent to the landowner, the Land Bank of the Philippines, the potential farmer beneficiaries, other interested
parties, and their counsels.
SECTION 8. Return of Claim Folder. — The Board/Adjudicator shall, within three (3) days from
return of the notice of the resolution pursuant to the preceding section, transmit the Claim Folder (CF),
together with the complete records thereof to the office of origin or the Provincial Agrarian Reform Officer
(PARO) concerned, copy furnished the LBP.
SECTION 9. Execution of Judgments for Just Compensation Which Have Become Final and
Executory. — The Sheriff shall enforce a writ of execution of a final judgment for compensation by demanding
for the payment of the amount stated in the writ of execution in cash and bonds against the Agrarian Reform
Fund in the custody of the LBP in accordance with RA 6657, as amended, and the LBP shall pay the same
in accordance with the final judgment and the writ of execution within five (5) days from the time the
landowner accordingly executes and submits to the LBP the corresponding deed/s of transfer in favor of the
government and surrenders the muniments of title to the property in accordance with Section 16 (c) of RA
6657, as amended.

SECTION 22. Qualified Beneficiaries. — 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. Provided,
however, That the children of landowners who are qualified under Section 6 of this Act shall be given preference
in the distribution of the land of their parents: and Provided, further, That actual tenant-tillers in the landholdings
shall not be ejected or removed therefrom. Beneficiaries under Presidential Decree No. 27 who have culpably
sold, disposed of, or abandoned their land are disqualified to become beneficiaries under this Program. A basic
qualification of a beneficiary shall be his willingness, aptitude, and ability to cultivate and make the land as
productive as possible. The DAR shall adopt a system of monitoring the record or performance of each
beneficiary, so that any beneficiary guilty of negligence or misuse of the land or any support extended to
him shall forfeit his right to continue as such beneficiary. The DAR shall submit periodic reports on the
performance of the beneficiaries to the PARC. If, due to the landowner's 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 this Act, at the option of the
beneficiaries. Farmers already in place and those not accommodated in the distribution of privately-owned
lands will be given preferential rights in the distribution of lands from the public domain.
SECTION 23. Distribution Limit. — No qualified beneficiary may own more than three (3) hectares of agricultural
land.
SECTION 24. Award to Beneficiaries. — 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 one hundred eighty
(180) days from the time the DAR takes actual possession of the land. Ownership of the beneficiary shall be
evidenced by a Certificate of Land Ownership Award, which shall contain the restrictions and conditions
provided for in this Act, and shall be recorded in the Register of Deeds concerned and annotated on the
Certificate of Title.
SECTION 25. Award Ceilings for Beneficiaries. —Beneficiaries shall be awarded an area not exceeding three
(3) hectares which may cover a contiguous tract of land or several parcels of land cumulated up to the prescribed
award limits. For purposes of this Act, a landless beneficiary is one who owns less than three (3) hectares of
agricultural land. The beneficiaries may opt for collective ownership, such as co-ownership or farmers
cooperative or some other form of collective organization: Provided, That the total area that may be awarded
shall not exceed the total number of co-owners or member of the cooperative or collective organization multiplied
by the award limit above prescribed, except in meritorious cases as determined by the PARC. Title to
the property shall be issued in the name of the co-owners or the cooperative or collective organization as the
case may be.
SECTION 26. Payment by Beneficiaries. —Lands awarded pursuant to this Act shall be paid for by the
beneficiaries to the LBP in thirty (30) annual amortizations at six percent (6%) interest per annum. The payments
for the first three (3) years after the award may be at reduced amounts as established by the PARC: Provided,
That the first five (5) annual payments may not be more than five percent (5%) of the value of the annual gross
production as established by the DAR. Should the scheduled annual payments after the fifth year exceed ten
percent (10%) of the annual gross production and the failure to produce accordingly is not due to
the beneficiary's fault, the LBP may reduce the interest rate or reduce the principal obligations to make the
repayment affordable. The LBP shall have a lien 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
amortizations. The LBP shall advise the DAR of such proceedings and the latter shall subsequently award the
forfeited landholdings to other qualified beneficiaries. A beneficiary whose land, as provided herein, has
been foreclosed shall thereafter be permanently disqualified from becoming a beneficiary under this Act. cd
SECTION 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 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 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) as herein provided, shall, in turn, be given due notice thereof by the BARC. 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. Failing compliance herewith, the land shall be
transferred to the LBP which shall give due notice of the availability of the land in the manner specified in the
immediately preceding paragraph. In the event of such transfer to the LBP, the latter shall compensate
the beneficiary in one lump sum for the amounts the latter has already paid, together with the value of
improvements he has made on the land.
SECTION 28. Standing Crops at the Time of Acquisition. —The landowner shall retain his share of any standing
crops unharvested at the time the DAR shall take possession of the land under Section 16 of the Act, and shall
be given a reasonable time to harvest the same.
SAMUEL V. DAR
On 21 October 1972, Presidential Decree No. 275 was issued mandating that tenanted rice and corn lands be
brought under Operation Land Transfer and awarded to farmer-beneficiaries.
HMI, through a certain Joaquin Colmenares, requested that 527.8308 hectares of its landholdings be placed
under the coverage of Operation Land Transfer. Receiving compensation therefor, HMI allowed petitioners and
other occupants to cultivate the landholdings so that the same may be covered under said law.
In 1973, the Department of Agrarian Reform (DAR) conducted a parcellary mapping of the entire landholdings
of 527.8308 hectares covered by OCT No. P-3077-1661. In 1975 and 1976, the DAR approved the Parcellary
Map Sketching (PMS) and the Amended PMS covering the entire landholdings.
HMI, through its representatives, actively participated in all relevant proceedings, including the determination of
the Average Gross Production per hectare at the Barangay Committee on Land Production, and was a signatory
of an undated Landowner and Tenant Production Agreement (LTPA), covering the 527.8308 hectares. The LTPA
was submitted to the Land Bank of the Philippines (LBP) in 1977.
Also in 1977, HMI executed a Deed of Assignment of Rights in favor of petitioners, among other persons, which
was registered with the Register of Deeds and annotated at the back of OCT No. P-3077-1661. The annotation
in the OCT showed that the entire 527.8308 hectares was the subject of the Deed of Assignment.
In 1982, a final survey over the entire area was conducted and approved. From 1984 to 1988, the corresponding
TCTs and EPs covering the entire 527.8308 hectares were issued to petitioners, among other persons.
In December 1997, HMI filed with the Regional Agrarian Reform Adjudicator (RARAD) of CARAGA, Region XIII,
17 petitions seeking the declaration of erroneous coverage under Presidential Decree No. 27 of 277.5008
hectares of its former landholdings covered by OCT No. P-3077-1661. HMI claimed that said area was not
devoted to either rice or corn, that the area was untenanted, and that no compensation was paid therefor. The
17 petitions, which were later consolidated, sought for the cancellation of the EPs covering the disputed 277.5008
hectares which had been awarded to petitioners. HMI did not question the coverage of the other 250.3300
hectares under Presidential Decree No. 27 despite claiming that the entire landholdings were untenanted and
not devoted to rice and corn.
On 27 November 1998, after petitioners failed to submit a Position Paper, the RARAD rendered a Decision
declaring as void the TCTs and EPs awarded to petitioners because the land covered was not devoted to rice
and corn, and neither was there any established tenancy relations between HMI and petitioners when
Presidential Decree No. 27 took effect on 21 October 1972. The Decision was based on a 26 March 1998 report
submitted by the Hacienda Maria Action Team. Petitioners’ TCTs and EPs were ordered cancelled. Petitioners
filed a Motion for Reconsideration, but the same was denied. Petitioners appealed to the Department of Agrarian
Reform Adjudication Board (DARAB) which affirmed the RARAD Decision.
After the DARAB denied petitioners’ Motion for Reconsideration, the latter proceeded to the Court of Appeals
with their Petition for Review on Certiorari. The Court of Appeals issued the following assailed Resolution:
A perusal of the petition reveals that the Verification and Certification of Non-Forum Shopping was executed by
Samuel A. Estribillo who is one of the petitioners, without the corresponding Special Power of Attorneys executed
by the other petitioners authorizing him to sign for their behalf in violation of Section 5, Rule 7 of the 1997 Rules
of Civil Procedure, as amended.
WHEREFORE, the petition is DENIED DUE COURSE and necessarily DISMISSED.6
Petitioners filed a "Motion for Reconsideration With Alternative Prayer with Leave of Court for the Admission of
Special Power of Attorney (SPA) Granted to Petitioner Samuel Estribillo by his Co-Petitioners." The Court of
Appeals denied the motion by issuing the following assailed Resolution:
Petitioners seek the reconsideration of Our Resolution promulgated on January 27, 2003 which dismissed the
petition for certiorari.
We find no reason to reverse, alter or modify the resolution sought to be reconsidered, since petitioners have
failed to show that their belated submission of the special power of attorney can be justified as against the
unequivocal requirements set forth by Sec. 5, Rule 7 of the 1997 Rules of Civil Procedure, as amended.
While it is true that the Supreme Court has recognized special circumstances that justify the relaxation of the
rules on non-forum shopping, such circumstances, however, are not present in the case at bar.
More importantly, said Rules cannot be relaxed in view of the Supreme Court’s ruling in Loquias vs. Ombudsman,
338 SCRA 62, which stated that, substantial compliance will not suffice in a matter involving strict observance
by the rules. The attestation contained in the certification [on] non-forum shopping requires personal knowledge
by the party who executed the same.
Since the Verification and Certification on Non-Forum shopping was executed without the proper authorization
from all the petitioners, such personal knowledge cannot be presumed to exist thereby rendering the petition
fatally defective.
Par. 2, Sec. 5 of Rule 7 of the 1997 Rules of Civil Procedure, as amended states:
"Failure to comply with the foregoing requirements shall not be curable by mere amendment of the complaint or
other initiatory pleading but shall be cause for the dismissal of the case without prejudice x x x"
It is, thus, clear that the Motion for Reconsideration has no legal basis to support it and should be dismissed
forthwith. Moreover, granting arguendo that a special power of attorney belatedly filed could cure the petition’s
defect, the requirement of personal knowledge of all the petitioners still has not been met since some of the other
petitioners failed to sign the same.
WHEREFORE, in view of the foregoing, the Motion for Reconsideration is hereby DENIED. 7
Petitioners now file this present Petition contending that there had been compliance with Rule 7, Section 5 of the
1997 Rules of Civil Procedure. They further reiterate their argument that the EPs are ordinary titles which become
indefeasible one year after their registration.
The petition is impressed with merit.1awphil.net
Petitioners have sufficiently complied with Rule 7, Section 5 of the 1997 Rules of Civil Procedure concerning the
Certification Against Forum shopping
Rule 7, Section 5 of the 1997 Rules of Civil Procedure was preceded by Revised Circular No. 28-91 and
Administrative Circular No. 04-94, which required a certification against forum shopping to avoid the filing of
multiple petitions and complaints involving the same issues in the Supreme Court, the Court of Appeals, and
other tribunals and agencies. Stated differently, the rule was designed to avoid a situation where said courts,
tribunals and agencies would have to resolve the same issues. Rule 7, Section 5, now provides:
Sec. 5. Certification against forum shopping. – The plaintiff or principal party shall certify under oath in the
complaint or other initiatory pleading asserting a claim for relief, or in a sworn certification annexed thereto and
simultaneously filed therewith: (a) that he has not theretofore commenced any action or filed any claim involving
the same issues in any court, tribunal or quasi-judicial agency and, to the best of his knowledge, no such other
action or claim is pending therein; (b) if there is such other pending action or claim, a complete statement of the
present status thereof; and (c) if he should thereafter learn that the same or similar action or claim has been filed
or is pending, he shall report that fact within five (5) days therefrom to the court wherein his aforesaid complaint
or initiatory pleading has been filed.
Failure to comply with the foregoing requirements shall not be curable by mere amendment of the complaint or
other initiatory pleading but shall be cause for the dismissal of the case without prejudice, unless otherwise
provided, upon motion and after hearing. The submission of a false certification or non-compliance with any of
the undertakings therein shall constitute indirect contempt of court, without prejudice to the corresponding
administrative and criminal actions. If the acts of the party or his counsel clearly constitute willful and deliberate
forum shopping, the same shall be ground for summary dismissal with prejudice and shall constitute direct
contempt as well as a cause for administrative sanctions.
Revised Circular No. 28-91 "was designed x x x to promote and facilitate the orderly administration of justice and
should not be interpreted with such absolute literalness as to subvert its own ultimate and legitimate objective or
the goal of all rules of procedure – which is to achieve substantial justice as expeditiously as possible."8 Technical
rules of procedure should be used to promote, not frustrate, justice.9 The same guidelines should still apply in
interpreting what is now Rule 7, Section 5 of the 1997 Rules of Civil Procedure.
Petitioner Samuel A. Estribillo, in signing the Verification and Certification Against Forum Shopping, falls within
the phrase "plaintiff or principal party" who is required to certify under oath the matters mentioned in Rule 7,
Section 5 of the 1997 Rules of Civil Procedure. Such was given emphasis by this Court when we held in
Mendigorin v. Cabantog10 and Escorpizo v. University of Baguio11 that the certification of non-forum shopping
must be signed by the plaintiff or any of the principal parties and not only by the legal counsel. In Condo Suite
Club Travel, Inc. v. National Labor Relations Commission,12 we likewise held that:
The certification in this petition was improperly executed by the external legal counsel of petitioner. For a
certification of non-forum shopping must be by the petitioner, or any of the principal parties and not by counsel
unless clothed with a special power of attorney to do so. This procedural lapse on the part of petitioner is also a
cause for the dismissal of this action. (Emphasis supplied)
The Court of Appeals heavily relied on the seemingly conflicting case of Loquias v. Office of the
Ombudsman,13where this Court ruled that:
At the outset, it is noted that the Verification and Certification was signed by Antonio Din, Jr., one of the petitioners
in the instant case. We agree with the Solicitor General that the petition is defective. Section 5, Rule 7 expressly
provides that it is the plaintiff or principal party who shall certify under oath that he has not commenced any
action involving the same issues in any court, etc. Only petitioner Din, the Vice-Mayor of San Miguel, Zamboanga
del Sur, signed the certification. There is no showing that he was authorized by his co-petitioners to represent
the latter and to sign the certification. It cannot likewise be presumed that petitioner Din knew, to the best of his
knowledge, whether his co-petitioners had the same or similar actions or claims filed or pending. We find that
substantial compliance will not suffice in a matter involving strict observance by the rules. The attestation
contained in the certification on non-forum shopping requires personal knowledge by the party who executed the
same. Petitioners must show reasonable cause for failure to personally sign the certification. Utter disregard of
the rules cannot justly be rationalized by harking on the policy of liberal construction. (Emphasis supplied)
Loquias, however, was a case involving only five petitioners seeking relief from the Resolution of the
Ombudsman charging them with violation of Republic Act No. 3019, where the above declaration "at the outset"
was made together with a determination on the lack of jurisdiction on our part to decide the Petition.14 There
being only five petitioners in Loquias, the unreasonableness of the failure to obtain the signatures of Antonio
Din, Jr.’s four co-accused is immediately apparent, hence the remark by this Court that "[p]etitioners must show
reasonable cause for failure to personally sign the certification." In the present petition, petitioners allege that
they are farmer-beneficiaries who reside in a very remote barangay in Agusan del Sur. While they reside in the
same barangay, they allegedly have to walk for hours on rough terrain to reach their neighbors due to the
absence of convenient means of transportation. Their houses are located far apart from each other and the mode
of transportation, habal-habal, is scarce and difficult. Majority of them are also nearing old age. On the other
hand, their lawyers (who are members of a non-government organization engaged in development work) are
based in Quezon City who started assisting them at the latter part of the RARAD level litigation in 1998, and
became their counsel of record only at the DARAB level. The petitioner who signed the initiatory pleading,
Samuel Estribillo, was the only petitioner who was able to travel to Manila at the time of the preparation of the
Petition due to very meager resources of their farmers’ organization, the Kahiusahan sa Malahutayong mga
Mag-uugma Para sa Ekonomikanhong Kalambuan (KAMMPE). When the Petition a quo was dismissed,
petitioners’ counsel went to Agusan del Sur and tried earnestly to secure all the signatures for the SPA. In fact,
when the SPA was being circulated for their signatures, 24 of the named petitioners therein failed to sign for
various reasons – some could not be found within the area and were said to be temporarily residing in other
towns, while some already died because of old age.15 Be that as it may, those who did not sign the SPA did not
participate, and are not parties to this petition.
The Court of Appeals merely said that the special circumstances recognized by this Court that justify the
relaxation of the rules on the certification against forum shopping are not present in the case at bar, 16 without
discussing the circumstances adduced by the petitioners in their Motion for Reconsideration. Thus, assuming for
the sake of argument that the actuation of petitioners was not strictly in consonance with Rule 7, Section 5 of the
1997 Rules of Civil Procedure, it should still be determined whether there are special circumstances that would
justify the suspension or relaxation of the rule concerning verification and certification against forum shopping,
such as those which we appreciated in the ensuing cases.
In General Milling Corporation v. National Labor Relations Commission,17 the appeal to the Court of Appeals had
a certificate against forum shopping, but was dismissed as it did not contain a board resolution authorizing the
signatory of the Certificate. Petitioners therein attached the board resolution in their Motion for Reconsideration
but the Court of Appeals, as in this case, denied the same. In granting the Petition therein, we explained that:
[P]etitioner complied with this procedural requirement except that it was not accompanied by a board resolution
or a secretary’s certificate that the person who signed it was duly authorized by petitioner to represent it in the
case. It would appear that the signatory of the certification was, in fact, duly authorized as so evidenced by a
board resolution attached to petitioner’s motion for reconsideration before the appellate court. It could thus be
said that there was at least substantial compliance with, and that there was no attempt to ignore, the prescribed
procedural requirements.
The rules of procedure are intended to promote, rather than frustrate, the ends of justice, and while the swift
unclogging of court dockets is a laudable objective, it, nevertheless, must not be met at the expense of substantial
justice. Technical and procedural rules are intended to help secure, not suppress, the cause of justice and a
deviation from the rigid enforcement of the rules may be allowed to attain that prime objective for, after all, the
dispensation of justice is the core reason for the existence of courts. [Acme Shoe, Rubber and Plastic Corp. vs.
Court of Appeals; BA Savings Bank vs. Sia, 336 SCRA 484].
In Shipside Incorporated v. Court of Appeals,18 the authority of petitioner’s resident manager to sign the
certification against forum shopping was submitted to the Court of Appeals only after the latter dismissed the
Petition. It turned out, in the Motion for Reconsideration, that he already had board authority ten days before the
filing of the Petition. We ratiocinated therein that:
On the other hand, the lack of certification against forum shopping is generally not curable by the submission
thereof after the filing of the petition. Section 5, Rule 45 of the 1997 Rules of Civil Procedure provides that the
failure of the petitioner to submit the required documents that should accompany the petition, including the
certification against forum shopping, shall be sufficient ground for the dismissal thereof. The same rule applies
to certifications against forum shopping signed by a person on behalf of a corporation which are unaccompanied
by proof that said signatory is authorized to file a petition on behalf of the corporation.
In certain exceptional circumstances, however, the Court has allowed the belated filing of the certification. In
Loyola v. Court of Appeals, et al. (245 SCRA 477 [1995]), the Court considered the filing of the certification one
day after the filing of an election protest as substantial compliance with the requirement. In Roadway Express,
Inc. v. Court of Appeals, et al. (264 SCRA 696 [1996]), the Court allowed the filing of the certification 14 days
before the dismissal of the petition. In Uy v. Landbank, supra, the Court had dismissed Uy’s petition for lack of
verification and certification against non-forum shopping. However, it subsequently reinstated the petition after
Uy submitted a motion to admit certification and non-forum shopping certification. In all these cases, there were
special circumstances or compelling reasons that justified the relaxation of the rule requiring verification and
certification on non-forum shopping.
In the instant case, the merits of petitioner’s case should be considered special circumstances or compelling
reasons that justify tempering the requirement in regard to the certificate of non-forum shopping. Moreover, in
Loyola, Roadway, and Uy, the Court excused non-compliance with the requirement as to the certificate of non-
forum shopping. With more reason should we allow the instant petition since petitioner herein did submit a
certification on non-forum shopping, failing only to show proof that the signatory was authorized to do so. That
petitioner subsequently submitted a secretary’s certificate attesting that Balbin was authorized to file an action
on behalf of petitioner likewise mitigates this oversight.
It must also be kept in mind that while the requirement of the certificate of non-forum shopping is mandatory,
nonetheless the requirements must not be interpreted too literally and thus defeat the objective of preventing the
undesirable practice of forum-shopping. Lastly, technical rules of procedure should be used to promote, not
frustrate justice. While the swift unclogging of court dockets is a laudable objective, the granting of substantial
justice is an even more urgent ideal.
In Uy v. Land Bank of the Philippines,19 we, likewise, considered the apparent merits of the substantive aspect
of the case as a special circumstance or compelling reason for the reinstatement of the case, and invoked our
power to suspend our rules to serve the ends of justice. Thus:
The admission of the petition after the belated filing of the certification, therefore, is not unprecedented. In those
cases where the Court excused non-compliance with the requirements, there were special circumstances or
compelling reasons making the strict application of the rule clearly unjustified. In the case at bar, the apparent
merits of the substantive aspects of the case should be deemed as a "special circumstance" or "compelling
reason" for the reinstatement of the petition. x x x
There were even cases where we held that there was complete non-compliance with the rule on certification
against forum shopping, but we still proceeded to decide the case on the merits. In De Guia v. De
Guia,20 petitioners raised in their Petition for Review the allowance of respondents’ Appeal Brief which did not
contain a certificate against forum shopping. We held therein that:
With regard to the absence of a certification of non-forum shopping, substantial justice behooves us to agree
with the disquisition of the appellate court. We do not condone the shortcomings of respondents’ counsel, but
we simply cannot ignore the merits of their claim. Indeed, it has been held that "[i]t is within the inherent power
of the Court to suspend its own rules in a particular case in order to do justice."
In Damasco v. National Labor Relations Commission,21 the non-compliance was disregarded because of the
principle of social justice, which is equally applicable to the case at bar:
We note that both petitioners did not comply with the rule on certification against forum shopping. The
certifications in their respective petitions were executed by their lawyers, which is not correct. The certification
of non-forum shopping must be by the petitioner or a principal party and not the attorney. This procedural lapse
on the part of petitioners could have warranted the outright dismissal of their actions.
But, the court recognizes the need to resolve these two petitions on their merits as a matter of social justice
involving labor and capital. After all, technicality should not be allowed to stand in the way of equitably and
completely resolving herein the rights and obligations of these parties. Moreover, we must stress that technical
rules of procedure in labor cases are not to be strictly applied if the result would be detrimental to the working
woman.
The foregoing cases show that, even if we assume for the sake of argument that there was violation of Rule 7,
Section 5 of the 1997 Rules of Civil Procedure, a relaxation of such rule would be justified for two compelling
reasons: social justice considerations and the apparent merit of the Petition, as shall be heretofore discussed.
Certificates of Title issued pursuant to Emancipation Patents are as indefeasible as TCTs issued in registration
proceedings.
Petitioners claim that the EPs have become indefeasible upon the expiration of one year from the date of its
issuance. The DARAB, however, ruled that the EP "is a title issued through the agrarian reform program of the
government. Its issuance, correction and cancellation is governed by the rules and regulations issued by the
Secretary of the Department of Agrarian Reform (DAR). Hence, it is not the same as or in the same category of
a Torrens title."
The DARAB is grossly mistaken.
Ybañez v. Intermediate Appellate Court,22 provides that certificates of title issued in administrative proceedings
are as indefeasible as certificates of title issued in judicial proceedings:
It must be emphasized that a certificate of title issued under an administrative proceeding pursuant to a
homestead patent, as in the instant case, is as indefeasible as a certificate of title issued under a judicial
registration proceeding, provided the land covered by said certificate is a disposable public land within the
contemplation of the Public Land Law.
There is no specific provision in the Public Land Law (C.A. No. 141, as amended) or the Land Registration Act
(Act 496), now P.D. 1529, fixing the one (1) year period within which the public land patent is open to review on
the ground of actual fraud as in Section 38 of the Land Registration Act, now Section 32 of P.D. 1529, and
clothing a public land patent certificate of title with indefeasibility. Nevertheless, the pertinent pronouncements
in the aforecited cases clearly reveal that Section 38 of the Land Registration Act, now Section 32 of P.D. 1529
was applied by implication by this Court to the patent issued by the Director of Lands duly approved by the
Secretary of Natural Resources, under the signature of the President of the Philippines in accordance with law.
The date of issuance of the patent, therefore, corresponds to the date of the issuance of the decree in ordinary
registration cases because the decree finally awards the land applied for registration to the party entitled to it,
and the patent issued by the Director of Lands equally and finally grants, awards, and conveys the land applied
for to the applicant. This, to our mind, is in consonance with the intent and spirit of the homestead laws, i.e.
conservation of a family home, and to encourage the settlement, residence and cultivation and improvement of
the lands of the public domain. If the title to the land grant in favor of the homesteader would be subjected to
inquiry, contest and decision after it has been given by the Government through the process of proceedings in
accordance with the Public Land Law, there would arise uncertainty, confusion and suspicion on the
government’s system of distributing public agricultural lands pursuant to the "Land for the Landless" policy of the
State.
The same confusion, uncertainty and suspicion on the distribution of government-acquired lands to the landless
would arise if the possession of the grantee of an EP would still be subject to contest, just because his certificate
of title was issued in an administrative proceeding. The silence of Presidential Decree No. 27 as to the
indefeasibility of titles issued pursuant thereto is the same as that in the Public Land Act where Prof. Antonio
Noblejas commented:
Inasmuch as there is no positive statement of the Public Land Law, regarding the titles granted thereunder, such
silence should be construed and interpreted in favor of the homesteader who come into the possession of his
homestead after complying with the requirements thereof. Section 38 of the Land Registration Law should be
interpreted to apply by implication to the patent issued by the Director of Lands, duly approved by the Minister
of Natural Resources, under the signature of the President of the Philippines, in accordance with law.23
After complying with the procedure, therefore, in Section 105 of Presidential Decree No. 1529, otherwise known
as the Property Registration Decree (where the DAR is required to issue the corresponding certificate of title
after granting an EP to tenant-farmers who have complied with Presidential Decree No. 27), 24 the TCTs issued
to petitioners pursuant to their EPs acquire the same protection accorded to other TCTs. "The certificate of title
becomes indefeasible and incontrovertible upon the expiration of one year from the date of the issuance of the
order for the issuance of the patent, x x x. Lands covered by such title may no longer be the subject matter of a
cadastral proceeding, nor can it be decreed to another person."25
As we held through Justice J.B.L. Reyes in Lahora v. Dayanghirang, Jr.26 :
The rule in this jurisdiction, regarding public land patents and the character of the certificate of title that may be
issued by virtue thereof, is that where land is granted by the government to a private individual, the corresponding
patent therefor is recorded, and the certificate of title is issued to the grantee; thereafter, the land is automatically
brought within the operation of the Land Registration Act, the title issued to the grantee becoming entitled to all
the safeguards provided in Section 38 of the said Act. In other words, upon expiration of one year from its
issuance, the certificate of title shall become irrevocable and indefeasible like a certificate issued in a registration
proceeding. (Emphasis supplied.)
The EPs themselves, like the Certificates of Land Ownership Award (CLOAs) in Republic Act No. 6657 (the
Comprehensive Agrarian Reform Law of 1988), are enrolled in the Torrens system of registration. The Property
Registration Decree in fact devotes Chapter IX27 on the subject of EPs. Indeed, such EPs and CLOAs are, in
themselves, entitled to be as indefeasible as certificates of title issued in registration proceedings.
The only defense of respondents, that the issue of indefeasibility of title was raised for the first time on appeal
with the DARAB, does not hold water because said issue was already raised before the RARAD. 28
The recommendation of the Hacienda Maria Action Team to have the EPs cancelled and the lots covered under
the Republic Act No. 6657,29 with the farmer-beneficiaries later on being issued with CLOAs, would only delay
the application of agrarian reform laws to the disputed 277.5008 hectares, leading to the expenditure of more
time and resources of the government.
The unreasonable delay of HMI in filing the Petition for cancellation more than 20 years after the alleged wrongful
annotation of the Deed of Assignment in OCT No. P-3077-1661, and more than ten years after the issuance of
the TCTs to the farmers, is apparently motivated by its desire to receive a substantially higher valuation and just
compensation should the disputed 277.5008 hectares be covered under Republic Act No. 6657 instead of
Presidential Decree No. 27.30 This is further proved by the following uncontested allegations by petitioners:
(i) HMI neither asked for rentals nor brought any action to oust petitioners from the farm they were
cultivating;
(ii) HMI had not paid realty taxes on the disputed property from 1972 onwards and never protested
petitioners’ act of declaring the same for realty taxation;
(iii) HMI, represented by a certain Angela Colmenares, signed the LTPA covering the entire landholdings
or the area of 527.8308 hectares, which was then represented to be rice and corn lands;
(iv) HMI abandoned the entire landholdings after executing the Deed of Assignment of Rights in 1977.
WHEREFORE, the Resolutions of the Court of Appeals in CA-G.R. SP No. 73902 are REVERSED and SET
ASIDE. The following EPs and the corresponding TCTs issued to petitioners or to their successors-in-interest
are hereby declared VALID and SUBSISTING:
ESTRIBILLO V DAR
Facts:Private respondent Hacienda Maria Inc. requested that 527.8308 hectares of itslandholdings be placed under the
coverage of Operation Land Transfer. Receiving compensationtherefor, HMI allowed petitioners and other occupants to
cultivate the landholdings so that thesame may be covered under Agrarian Reform Program. In 1982, a final survey over
the entirearea was conducted and approved. From 1984 to 1988, the corresponding TCTs and EPscovering the entire
527.8308 hectares were issued to petitioners, among other persons. InDecember 1997, HMI filed with RARAD petitions
seeking the declaration of erroneous coverageunder Presidential Decree No. 27 of 277.5008 hectares of its former
landholdings. HMI claimedthat said area was not devoted to either rice or corn, that the area was untenanted, and that
nocompensation was paid therefor. RARAD rendered a decision declaring as void the TCTs andEPs awarded to petitioners
because the land covered was not devoted to rice and corn, andneither was there any established tenancy relations
between HMI and petitioners. Petitionersappealed to the DARAB which affirmed the RARAD Decision. On appeal to the
CA, the samewas dismissed. Petitioners contended that the EPs became indefeasible after the expiration of oneyear from
their registration.
Issue:Whether or not EPs have become indefeasible one year after their issuance.
Held:After complying with the procedure in Section 105 of Presidential Decree No. 1529,otherwise known as the Property
Registration Decree where the DAR is required to issue thecorresponding certificate of title after granting an EP to tenant-
farmers who have complied withPresidential Decree No. 27, the TCTs issued to petitioners pursuant to their EPs acquire
the same protection accorded to other TCTs. The certificate of title becomes indefeasible andincontrovertible upon the
expiration of one year from the date of the issuance of the order for theissuance of the patent. Lands covered by such
title may no longer be the subject matter of acadastral proceeding, nor can it be decreed to another person