Agrarian Law

Case Digest- Batch Two

1. Luz Farms vs. Secretary of the Department of Agrarian Reform 192 SCRA 51 (1990)

Facts:`

Petitioner Luz Farms is a corporation engaged in livestock and poultry

business. It seeks to nullify Sec. 3 and Sec. 11 of RA 6657 in so far as they apply
to livestock and poultry business.

Held:

Sec. 3 (b) and Sec. 11 of RA 6657 are unconstitutional in so far as they

include lands devoted to raising livestock, swine and poultry within its coverage.
The use of land is incidental to but not the principal factor or consideration of
productivity in this industry. The Supreme Court held that:

The transcripts of 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 RA 3844, as land devoted to any
growth, including but not limited to crop lands, saltbeds, fishponds,
idle and abandoned land (Record, CONCOM, August 7, 1986, Vol.
III, p. 11).

The Supreme Court noted that the intention of the

Committee to limit the application of the word “agriculture” is further
shown by the proposal of Commissioner Jamir to insert the word
“arable” to distinguish this kind of agricultural land from such lands
as commercial and industrial lands and residential properties. The
proposal however was not considered because the Committee
contemplated that agricultural lands are limited to arable and
suitable agricultural lands and therefore, do not include commercial,
industrial and residential lands (Record, CONCOM, 7 August 1986,
Vol. III, p. 30).

Moreover, in his answer to Commissioner Regalado’s

interpellation, Commissioner Tadeo clarified that the term
“farmworkers” was used instead of “agricultural worker” in order to
exclude therein piggery, poultry and livestock workers (Record,
CONCOM, August 2, 1986, Vol. II, p. 621).

DAR AO 9 (1993) imposes two (2) conditions in order that these lands may be exempted:
(a) that the land or portion thereof is exclusively, directly, or actually used for livestock, poultry

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and swine raising as of 15 June 1988; and (b) the farm must satisfy the ratios of land, livestock,
poultry and swine, as follows:

Cattle, carabao and horse raising Maximum of 1 to 1 hectare; 2 heads for

every 1.7815 hectares of infrastructure

Sheep and goat raising 7 heads to 1 hectare; 147 heads for every
0.7205 hectare of infrastructure

Sine raising 21 heads of hogs for every 0.5126 hectare

of infrastructure

poultry raising 500 layers for every 0.53 hectare of

infrastructure or 1000 boilers for every
1.428 hectares of infrastructure

Fishponds and prawn ponds

With the amendment of Sec. 3 (c), 10 and 11 of RA 6657 by RA 7881, fishponds and
prawn ponds are also exempted from the coverage of CARP, provided that said lands have not
been distributed to ARBs and no CLOAs have been issued.

To be exempted, the agricultural land must have been actually, directly and exclusively
used for prawn farms and fishponds as of 12 March 1995, the date of effectivity of RA 7881. To
avail of the exemption, a landowner or his authorized representative still has to file a written
application for land exemption/exclusion with DAR Provincial Office (DAR Adm. O. No. 3[1995]).

In cases were the fishponds or prawn farms have been subjected to CARP, by voluntary offer to
sell, commercial farms deferment or notice of compulsory acquisition, they can be exempt from
CARP if a simple and absolute majority of the actual regular workers or tenants consent to the
exemption within one (1) year from the effectivity of RA 7881 or on 12 March 1995. in cases where
the fishponds or prawnponds have not been subjected to CARP, the consent of the farm workers
shall no longer be necessary (Rep. Act No. 6657 [1998], sec. 10[b], as amended.)

Sec. 4 of RA 7881 also amended RA 6657 by introducing a new provision mandating the
introduction of an incentive plan for employees of all fishponds and prawn farms. Operators and
entities owning or operating fishponds and prawn farms are directed to execute within six (6)
months from its effectivity an incentive plan with their regular fishpond or prawn farm worker’s
organization, if any, whereby seven point five percent (7.5%) of nrt profits before tax from the
operation of the fishpond or prawn farms are distributed within sixty (60) days at the end of the
fiscal year as compensation to regular and other pond workers over and above their current
compensation. This incentive plan requirement, however, does not apply to agricultural lands
subsequently converted to fishponds or prawnfarms provided that the size of the land converted
does not exceed the retention limit of the landowner.

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1B. Luz Farms vs Sec. of DAR G.R. No. 86889. December 4, 1990.

FACTS:
 In 1988, RA 6657 was approved by the President of the Philippines. It includes the raising
of livestock, poultry, and swine in its coverage.
 In 1989, the Secretary of Agrarian Reform promulgated the IRR of Secs. 11, 13, and 39
of the said law.
 Luz Farms is a corporation engaged in the livestock and poultry business allegedly stands
to be adversely affected by the enforcement of some provisions of CARP.
 Luz Farms questions the following provisions of R.A. 6657, insofar as they are made to
apply to it:
a) Section 3(b) which includes the "raising of livestock (and poultry)" in the definition of
"Agricultural, Agricultural Enterprise or Agricultural Activity.
b) Section 11 which defines "commercial farms" as "private agricultural lands devoted to
commercial, livestock, poultry and swine raising . . ."
c) Section 13 which calls upon petitioner to execute a production-sharing plan.
d) Section 16(d) and 17 which vest on the Department of Agrarian Reform the authority
to summarily determine the just compensation to be paid for lands covered by the
Comprehensive Agrarian Reform Law
e) Section 32 which spells out the production-sharing plan mentioned in Section 13
f) ". . . (W)hereby three percent (3%) of the gross sales from the production of such lands
are distributed within sixty (60) days of the end of the fiscal year as compensation to
regular and other farmworkers in such lands over and above the compensation they
currently receive xxx

ISSUE:
1. WON the CARL should include the raising of livestock, poultry and swine in its coverage.
2. WON the requirement in Sections 13 and 32 of RA 6657 directing “corporate farms” to
execute and implement “production-sharing plans” is unreasonable for being
confiscatory and violative of due process, with respect to livestock and poultry raisers.

Separate Opinion: Sarmiento, J.

WON the assailed provisions violate the equal protection clause of the Constitution.

HELD:
1. NO. Sec. 3 (b) and Sec. 11 of RA 6657 are unconstitutional in so far as they include lands
devoted to raising livestock, swine and poultry within its coverage. The use of land is
incidental to but not the principal factor or consideration of productivity in this industry. It
was never the intention of the framers of the Constitution to include the livestock and
poultry industry in the coverage of the agrarian reform program of the government. The
intention of the Committee was to limit the application of the word “agriculture”. Thus,
Section II of RA 6657 which includes “private agricultural lands devoted to commercial
livestock, poultry, and swine raising” in the definition of “commercial farms” is invalid, to
the extent that the aforecited agro-industrial activities are made to be covered by the
agrarian reform program of the State.

2. YES. As there is no reason to include livestock and poultry lands in the coverage of
agrarian reform, there is no need to call upon them to distribute from 3% of their gross
sales and 10% of their net profits to their workers as additional compensation.

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 3. (Separate Opinion) NO. Substantial distinctions exist between land directed purely to
cultivation and harvesting of fruits or crops and land exclusively used for livestock, poultry
and swine raising that make real differences:
a. There are no tenants nor landlords in livestock and poultry businesses;
b. Livestock and poultry do not sprout from land;
c. Land is not a primary resource;
d. Livestock and poultry production are industrial activities;
e. Livestock and poultry farmworkers are covered by minimum wage law rather than
by tenancy law.

JURISPRUDENCE:
Raising of livestock, poultry, and swine are excluded from the coverage of the CARL.

2. SAMAHAN NG MAGSASAKA AT MANGINGISDA NG SITIO NASWE, INC. [SAMMANA],

REPRESENTED BY ROGELIO A. COMMENDADOR, PRESIDENT, PETITIONER, VS.
TOMAS TAN, RESPONDENT.

3.

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4.
Association of Small Landowners in the Philippines, Inc. vs Secretary of Agrarian Reform
175 SCRA 343 – Political Law – Constitutional Law – Bill of Rights – Equal Protection – Valid
Classification
Eminent Domain – Just Compensation
These are four consolidated cases questioning the constitutionality of the Comprehensive
Agrarian Reform Act (R.A. No. 6657 and related laws i.e., Agrarian Land Reform Code or R.A.
No. 3844).
Brief background: Article XIII of the Constitution on Social Justice and Human Rights includes a
call for the adoption by the State of an agrarian reform program. 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. RA 3844 was enacted in 1963. P.D. No. 27 was
promulgated in 1972 to provide for the compulsory acquisition of private lands for distribution
among tenant-farmers and to specify maximum retention limits for landowners. In 1987, President
Corazon Aquino issued E.O. No. 228, declaring full land ownership in favor of the beneficiaries of
PD 27 and providing for the valuation of still unvalued lands covered by the decree as well as the
manner of their payment. In 1987, P.P. No. 131, instituting a comprehensive agrarian reform
program (CARP) was enacted; later, E.O. No. 229, providing the mechanics for its (PP131’s)
implementation, was also enacted. Afterwhich is the enactment of R.A. No. 6657, Comprehensive
Agrarian Reform Law in 1988. This law, while considerably changing the earlier mentioned
enactments, nevertheless gives them suppletory effect insofar as they are not inconsistent with
its provisions.
[Two of the consolidated cases are discussed below]
G.R. No. 78742: (Association of Small Landowners vs Secretary)
The Association of Small Landowners in the Philippines, Inc. sought exception from the land
distribution scheme provided for in R.A. 6657. The Association is comprised of landowners of
ricelands and cornlands whose landholdings do not exceed 7 hectares. They invoke that since
their landholdings are less than 7 hectares, they should not be forced to distribute their land to
their tenants under R.A. 6657 for they themselves have shown willingness to till their own land.
In short, they want to be exempted from agrarian reform program because they claim to belong
to a different class.
G.R. No. 79777: (Manaay vs Juico)
Nicolas Manaay questioned the validity of the agrarian reform laws (PD 27, EO 228, and 229) on
the ground that these laws already valuated their lands for the agrarian reform program and that
the specific amount must be determined by the Department of Agrarian Reform (DAR). Manaay
averred that this violated the principle in eminent domain which provides that only courts can
determine just compensation. This, for Manaay, also violated due process for under the
constitution, no property shall be taken for public use without just compensation.
Manaay also questioned the provision which states that landowners may be paid for their land in
bonds and not necessarily in cash. Manaay averred that just compensation has always been in
the form of money and not in bonds.
ISSUE:

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1. Whether or not there was a violation of the equal protection clause.
2. Whether or not there is a violation of due process.
3. Whether or not just compensation, under the agrarian reform program, must be in terms of
cash.
HELD:
1. No. The Association had not shown any proof that they belong to a different class exempt from
the agrarian reform program. Under the law, classification has been defined as the grouping of
persons or things similar to each other in certain particulars and different from each other in these
same particulars. To be valid, it must conform to the following requirements:
(1) it must be based on substantial distinctions;
(2) it must be germane to the purposes of the law;
(3) it must not be limited to existing conditions only; and
(4) it must apply equally to all the members of the class.
Equal protection simply means that all persons or things similarly situated must be treated alike
both as to the rights conferred and the liabilities imposed. The Association have not shown that
they belong to a different class and entitled to a different treatment. The argument that not only
landowners but also owners of other properties must be made to share the burden of
implementing land reform must be rejected. There is a substantial distinction between these two
classes of owners that is clearly visible except to those who will not see. There is no need to
elaborate on this matter. In any event, the Congress is allowed a wide leeway in providing for a
valid classification. Its decision is accorded recognition and respect by the courts of justice except
only where its discretion is abused to the detriment of the Bill of Rights. In the contrary, it appears
that Congress is right in classifying small landowners as part of the agrarian reform program.
2. No. It is true that the determination of just compensation is a power lodged in the courts.
However, there is no law which prohibits administrative bodies like the DAR from determining just
compensation. In fact, just compensation can be that amount agreed upon by the landowner and
the government – even without judicial intervention so long as both parties agree. The DAR can
determine just compensation through appraisers and if the landowner agrees, then judicial
intervention is not needed. What is contemplated by law however 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. This is even so provided by RA 6657:
Section 16 (f): Any party who disagrees with the decision may bring the matter to the court of
proper jurisdiction for final determination of just compensation.
3. No. Money as [sole] payment for just compensation is merely a concept in traditional exercise
of eminent domain. 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.

5. G.R. No. 169514- March 30, 2007- CONFED vs.DAR

FACTS:

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Confederation of Sugar Producers Association, Inc (CONFED), the National Federation of
Sugarcane Planters, Inc. (NFSP), United Sugar Producers Federation of the Phil., Inc.
(UNIFED), the Panay Federation of Sugarcane Farmers, Inc. (PANAYFED). It seeks, inter alia,
to enjoin the Department of Agrarian Reform(DAR), the Land Bank of the Philippines(LBP), and
the Land Registration Authority(LRA) from "subjecting the sugarcane farms of Petitioner
Planters to eminent domain or compulsory acquisition without filing the necessary expropriation
proceedings pursuant to the provisions of Rule 67 of the Rules of Court and/or without the
application or conformity of a majority of the regular farmworkers on said farms."

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 of RA 6657, otherwise known as the
Comprehensive Agrarian Reform Law. In other words, their arguments, are anchored on the
proposition that these provisions are unconstitutional.

The petitioners thus contend that a landowner cannot be deprived of his property until
expropriation proceedings are instituted in court. They insist that the expropriation proceedings
to be followed are those prescribed under Rule 67 of the Revised Rules of Court. In other
words, for a valid exercise of the power of eminent domain, the Government must institute the
necessary expropriation proceedings in the competent court in accordance with the provisions
of the Rules of Court.

ISSUE: WON paragraphs d,e,and f of RA6657 valid?WON the compulsory acquisition of

land valid?

RULING:

(1)The validity of Section 16, including paragraphs (d), (e) and (f) thereof, of RA 6657 has
already been affirmed in Association of Small Landowners, which sets forth the manner of
acquisition of private agricultural lands and ascertainment of just compensation, in this wise:

Where the State itself is the expropriator, it is not necessary for it to make a deposit upon its
taking possession of the condemned property, as "the compensation is a public charge, the
good faith of the public is pledged for its payment, and all the resources of taxation may be
employed in raising the amount." Nevertheless, 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. x x x 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

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The determination made by the DAR is only preliminary unless accepted by all parties
concerned. Otherwise, the courts of justice will still have the right to review with finality
the said determination in the exercise of what is admittedly a judicial function.

(2) 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.

In Roxas & Co., Inc. v. Court of Appeals:

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. Any party may question the decision of the DAR in the
regular courts for final determination of just compensation.

6. LAND BANK OF THE PHILIPPINES, petitioner, vs. COURT OF APPEALS, PEDRO L. YAP,
HEIRS OF EMILIANO F. SANTIAGO, AGRICULTURAL MANAGEMENT & DEVELOPMENT
CORP., respondents.
G.R. No. 118712
October 6, 1995 (2D)

DEPARTMENT OF AGRARIAN REFORM, represented by the Secretary of Agrarian

Reform, petitioner,
vs.
COURT OF APPEALS, PEDRO L. YAP, HEIRS OF EMILIANO F. SANTIAGO,
AGRICULTURAL MANAGEMENT & DEVELOPMENT CORP., ET AL., respondents.
G.R. No. 118745
October 6, 1995

Facts: Separate petitions for review were filed by petitioners Department of Agrarian Reform
(DAR) (G.R. No. 118745) and Land Bank of the Philippines (LBP) (G.R. No. 118712) following
the adverse ruling by the Court of Appeals, granting private respondents' Petition for Certiorari
and Mandamus. However, upon motion filed by private respondents, the petitions were ordered

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consolidated. Likewise, petitioners seek the reversal of the Resolution, denying their motion for
reconsideration.

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). Aggrieved by the alleged lapses of the DAR and LBP with respect to the
valuation and payment of compensation for their land pursuant to the provisions of RA 6657,
private respondents filed with the Court a Petition for Certiorari and Mandamus with prayer for
preliminary mandatory injunction. 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 LBP, in lieu of depositing in cash or bonds in an
accessible bank designated by the DAR, the compensation for the land before it is taken and the
titles are cancelled as provided under Section 16(e) of RA 6657. Private respondents also assail
the fact that the DAR and the LBP 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. The
respondent court rendered the assailed decision in favor of private respondents. Petitioners filed
a motion for reconsideration but respondent court denied the same, hence, the instant petitions.

Issue: Whether or not the deposit may be made in other forms besides cash or LBP bonds

Held: 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 Section
16(e) of RA 6657 is very specific that the deposit must be made only in "cash" or in "LBP bonds".
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.

The ruling in the "Association" case merely recognized the extraordinary nature of the
expropriation to be undertaken under RA 6657 thereby allowing a deviation from the traditional
mode of payment of compensation and recognized payment other than in cash. It did not,
however, dispense with the settled rule that there must be full payment of just compensation
before the title to the expropriated property is transferred.

Issue: Whether or not there should be a distinction the deposit of compensation and
determination of just compensation

Held: To withhold the right of the landowners to appropriate the amounts already deposited in
their behalf as compensation for their properties simply because they rejected the DAR's
valuation, and notwithstanding that they have already been deprived of the possession and use
of such properties is an oppressive exercise of eminent domain. It is unnecessary to distinguish
between deposit of compensation (provisional) under Section 16(e) and determination of just
compensation (final) under Section 18 for purposes of exercising the landowners' right to
appropriate the same. The immediate effect in both situations is the same the landowner is
deprived of the use and possession of his property for which he should be fairly and immediately
compensated.

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7. [G.R NO. 200454. October 22, 2014]
HOLY TRINITY REALTY & DEVELOPMENT CORPORATION, petitioner,
vs. VICTORIO DELA CRUZ, LORENZO MANALAYSAY,
RICARDO MARCELO, JR. and LEONCIO DE GUZMAN, respondents.

FACTS:
A parcel of land in Bulacan is registered to Freddie Santiago. The Dakila property used to
be tenanted by Susana Surio and the others but the tenants freely and voluntarily relinquished
their tenancy rights in favor of Santiago through their respective sinumpaang pahayag in
exchange for some financial assistance and individual homelots titled and distributed in their
names.
Holy Trinity purchased the remaining 208, 050 sq. m. of the Dakila property from Santiago.
Santiago caused the transfer of the title to Holy Trinity and subdivided the Dakila property into 6
lots. Holy Trinity then develop the property by dumping filing materials on the topsoil, erected a
perimeter fence and steel gate and later on established its field office on the property.
In 1988, the Sanggunian Bayan ng Malolos passed Municipal Resolution No. 16-98
reclassifying four of the six subdivided lots belonging to the Holy Trinity into residential lots. The
Municipal Planning and Development Office (MPDO) of Bulacan issued the Certificate of Eligibility
for Conversion, Preliminary Approval and Locational Clearance in favor of Holy Trinity for its
residential subdivision project on the Dakila property.
In 1999, Holy Trinity purchased another from Santiago another parcel of land in Bulacan.
In 2006, Silvino Manalad and the alleged heirs of Felix Surio wrote to Provincial Agrarian Reform
Officer (PARO) of Bulacan to request an investigation of the sale of the Dakila property. It was
followed by the letter request of the Chairman of Sumapang Matanda Barangay Agrarian Reform
Council (BARC) to place the Dakila property within the coverage of Operation Land Transfer
(OLT) pursuant to PD 27. DAR Provincial Office of Bulacan filed a petition to annul the sale of the
Dakila property with the Provincial Agrarian Reform Adjudicator (PARAD) of Bulacan.

RULING OF THE DAR REGIONAL OFFICE:

OIC-Regional Director in Pampanga issued an order granting the letter request of BARC
Chairman. He claimed that the sale of the Dakila property was a prohibited transaction under PD
27, Sec. 6 of RA 6657 and DAR Admin. Order no. 1, Series of 1989 and that Holy Trinity was
disqualified from acquiring land under RA 6657 because it is a corporation. Petitioner assailed
the order and file Motion to Withdraw/Quash/Set Aside, while the motion was pending the Register
of Deeds issued emancipation patents (EP) pursuant to the order of the OIC-RD.

RULING OF THE DAR SECRETARY:

Holy Trinity appealed to Dar Sec. claiming the request for coverage under PD 27 and the
filing of the petition for annulment of sale in DARAB constituted forum shopping and the EP’s are
premature. But it was denied, holding that forum was not committed because the cause of action
in the letter request and the action for cancellation of the deed of sale before DARAB were distinct
and separate, that EP’s were regularly issued and that the resolution of the DARAB did not affect
the validity of EP’s. DAR Sec. ruled that Dakila property was not exempt from the coverage of
PD 27 and Ra 6657 because Municipal Resolution No. 16-98 did not change or reclassify but
merely re-zoned the Dakila property.

RULING OF THE OFFICE OF THE PRESIDENT:

The OP reversed the ruling of the DAR Sec upon its finding that the Dakila Property had
cease to be suitable for agriculture and had been reclassified as residential land pursuant to Mun.
Reso. No. 16-98. It shows that the City Assessor of Malolos and the Provincial Assessor of

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Bulacan have considered these lands as residential for taxation purposes. Dela Cruz appealed to
the CA.

RULING OF THE CA:

CA reversed that set aside the decision of the OP. It declared that prior to the effectively
of RA6657 and even after the passage of Mun. Reso 16-98, the Dakila property was an
agricultural land, that there was no valid reclassification because Sec. 20 of Ra 7160 and Memo
Cir. 54 required an ordinance, not resolution and the findings of DAR should be respected.

ISSUES:
 WON CA erred that Dela Cruz and others EPs from DAR are not legitimate tenants
of the Dakila property; that the sale and property of titles in the name of Holy Trinity
was not nullified by the DARAB or the regular courts; that the Bonafide tenants of
the Dakila property have validly surrendered their tenancy rights in favor of Holy
Trinity’s predecessor-in-interest and; that Dakila property was no longer tenanted,
no longer suitable to agriculture at the time of its coverage under agrarian reform
and is actually being residential.
 WON CA erred in failing to rule on the illegality of the manner the DAR issuing the
summary coverage of the Dakila property under the CARP, its extra-judicial
cancellation of Holy Trinity’s title without due process and the premature issuance
of EP
 WON CA erred in applying RA 6657 even though DAR placed the Dakila property
under the coverage of PD 27.

PETITIONER’S ARGUMENTS:
Holy Trinity argues that CA ignored issues vital to the complete determination of the
parties’ respective rights over the Dakila property. They argue that CA should have ruled on the
propriety of issuing the EPs, that since the petition was still pending in DARAB, DAR should have
withheld the issuance of the EPs.
Holy Trinity claimed that they were deprived of due process because the requirements of
notice and conduct off public hearing and a field investigation were not strictly complied with by
the DAR pursuant to RA 6657 and DAR Admin Order No. 12, Series of 1998.
Holy Trinity asserted that CA erred in placing Dakila property under the coverage of RA
6657 when the order of OIC-RD applied the provisions of PD27 and that the two laws should be
differentiated from each other. CA, according to Holy Trinity, should have dismissed Dela Cruz
petition for review due to its defective certification, pointing to the verification having been signed
by BARC Chairman.
RESPONDENT’S ARGUMENT:
They claimed the CA correctly set aside the issue of whether or not they were qualified
beneficiaries because it was not the issue raised in the letter request; that CA could not have
ruled on the validity of the Dakila property in light of the pending action in DARAB; the waivers by
the tenants were illegal and that the issuance of the EPs was a necessary consequence of placing
the Dakila property under the coverage of PD 27.

RULING:
 SC ruled that CA rightly allowed the petition for review of Dela Cruz, SC underscore that
the defect was even lifted upon the voluntary submission by the respondents themselves
of their corrected verification in order to comply with the Rules of Court. The respondents,

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 as identified beneficiaries, had legal standing and interest to intervene to protect
their rights or interest under RA 6657. This is clear from Sec. 19 of RA 9700 which
amended RA 6657 by adding 50-A, to wit:
Section. 50-A. Exclusive Jurisdiction on Agrarian Dispute.
In cases where regular courts or quasi-judicial bodies have competent jurisdiction,
agrarian reform beneficiaries or identified beneficiaries and/or their associations
shall have legal standing and interest to intervene concerning their individual or
collective rights and/or interest under the CARP.
 Under Sec. 8 of Rule 51 of Rules of Court, Ca is vested with sufficient authority and
discretion to review matters, not assigned as errors on appeal, if it finds that consideration
thereof is necessary in arriving at a complete and just resolution of the case or to serve
the interests of justice or to avoid dispensing piecemeal justice.

In the case at bar, the validity of EPs cannot deny that it was closely intertwined with issue of
whether the Dakila property was covered by the agrarian reform laws. When Ca declared that
Dakila property was within the coverage of RA 6657, CA only left more questions unresolved. The
case was originated when BARC Chairman requested that the Dakila property be placed under
the OLT pursuant to PD 27. SC agrees with the Holy Trinity that the two laws are distinct from
one another.

RA 6657 PD 27
Applies to all agricultural lands in which Requires that the covered agricultural
agricultural activities are conducted land be tenanted and primarily devoted
to rice or corn cultivation.
A certificate of land ownership award Ownership of the beneficiary in this law
(CLOA) is issued for the ownership of is evidenced by a EP
the beneficiary

Thus CA could not simply set aside the issue of whether the EPs issued to the respondents
were validly made by the DAR considering its declaration that the Dakila property was subject to
RA 6657.

 Under RA 7160, local governments are vested with the property to reclassify lands.
However, Sec. 20, Chap. II, Title I of RA 7160 provides that:

Section 20. Reclassification of Lands. – (a) A city or municipality may, through

an ordinance passed by the sanggunian after conducting public hearings for
the purpose, authorize the reclassification of agricultural lands and provide for the
manner of the utilization or disposition in the following case: (1) when the land
ceases to be economically feasible and sound for agricultural purposes as
determined by DAR or (2) where the land shall have substantially greater economic
value for residential, commercial, or industrial purposes, as determined by the
sanggunian concerned.

Thus an ordinance is needed to reclassify agricultural lands and such may only be passed
after the conduct of public hearings. Holy Trinity claims the reclassification based on the Mun.
Reso. No. 16-98. SC ruled that the resolution was ineffectual for that purpose. A resolution
was a mere declaration of the sentiment or opinion of the lawmaking body on a specific
matter that was temporary in nature and differed from an ordinance in that the latter was a

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law by itself and possessed a general and permanent character. There was also no
showing of the requisite public hearing. Thus in the absence of the valid and complete
reclassification, the Dakila property remained under the category of an agricultural land.
Nonetheless, the Dakila property was not an agricultural land subject to the coverage of
RA 6657 or PD 27.

RA 6657 PD 27
For a land to be under the coverage of RA  For a land to be covered under PD 27,
6657, it must either be primarily devoted to or it must be devoted to rice and corns.
be suitable for agriculture.  There must be a system of share-crop
 “Agricultural land” is one that is or lease-tenancy obtaining therein.
devoted to agricultural activity and not  If either the requisite is absent, the
classified as mineral, forest, land must be excluded
residential, commercial or industrial
land.
 “Agricultural activity” includes the
cultivation of the soil; 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
persons whether juridical or natural.

 Thus two requisites are needed

before the land can be placed under
the coverage of RA 6657 (1) land
must be devoted to agricultural
activity and (2) land must not be
classified as mineral, forest,
residential, commercial or industrial
land.

Though the second requisite was complied with in the Dakila property, the first
requisite is wanting because no evidence was submitted to show that any agricultural
activity were being performed on the Dakila property. SC take note that the tenant voluntarily
surrender their tenancy rights because the land was not conducive to farming by reason of
elevation and in the Whereas Claus of the Mun. Reso. No. 16-98 that mentioned that Dakila
property was not fit for agricultural use due to lack of sufficient irrigation and it was more suitable
for residential use.
PD 27 is still not applicable because Dakila property was still not within the scope of the
law. The first requisite of PD 27 was not sufficiently established. The report submitted by the Legal
Services Division did not mention whatsoever the agricultural activities performed in the Dakila
property. There was also no showing the Dakila property was devoted for rice or corn cultivation.
Thus Dakila property should be excluded from the OLT. There was also no showing that the
respondents were engaged in any agricultural activities or agreed with Santiago or Holy Trinity on
the sharing of harvest.

WHEREFORE, the Court GRANTS the petition for review on certiorari; REVERSES AND
SET ASIDE the decision of the CA; REINSTATES the assailed decision of the OP; DIRECTS the

15
cancellation of Emancipation patents to the respondent for being NULL AND VOID AND
ORDERS the respondents to pay the costs of suit.

8. G.R. No. L-20620; August 15, 1974

REPUBLIC OF THE PHILIPPINES, plaintiff-appellant vs. CARMEN M. VDA. DE CASTELLVI,
ET AL., defendants-appellees

FACTS:
This is an appeal from the decision of CFI Pampanga in an expropriation proceeding.
Republic of the Philippines filed in 1959 a complaint for eminent domain against Carmen
M. Vda. de Castellvi, judicial administratrix of the estate of the late Alfonso de Castellvi over a
parcel of land situated in the barrio of San Jose, Floridablanca, Pampanga.
Republic alleged that the fair market value of the lands was not more than P2,000 per
hectare and prayed that the provisional value of the lands be fixed at P259.669.10, that the court
authorizes plaintiff to take immediate possession of the lands upon deposit of that amount, among
others. These were granted by the trial court.
In her "motion to dismiss", Castellvi alleged that it is a residential land and had a fair market
value of P15.00 per square meter, so it had a total market value of P11,389,485.00; that the
Republic, through the AFP, had been illegally occupying her property since 1956, thereby
preventing her from using and disposing of it, thus causing her damages by way of unrealized
profits.
The Republic was actually placed in possession of the lands on August 10,
1959. The trial Court appointed three commissioners who in 1961 submitted their report and
recommendation, which unanimously says that the lowest price that should be paid was P10.00
per square meter, and that no consequential damages be awarded, among others.
The Commissioners' report was objected to by all the parties in the case — by defendants
Castellvi and Toledo-Gozun, who insisted that the fair market value of their lands should be fixed
at P15.00 per square meter; and by the Republic, which insisted that the price to be paid for the
lands should be fixed at P0.20 per square meter.

ISSUE:
Whether or not the trial court erred in 1.) finding the price of P10 per square meter of the
lands subject of the instant proceedings as just compensation; and 2.) holding that the "taking" of
the properties under expropriation commenced with the filing of this action.

HELD:
1.) YES. We The price of P10.00 per square meter, as recommended by the
commissioners and adopted by the lower court, is quite high. It is the Court’s considered view that
the price of P5.00 per square meter would be a fair valuation of the lands in question and would
constitute a just compensation to the owners thereof. The Court has weighed all the
circumstances relating to this expropriations proceedings and has also taken judicial notice of the
fact that the value of the Philippine peso has considerably gone down since the year 1959.
2.) NO. A number of circumstances must be present in the "taking" of property for
purposes of eminent domain. First, the expropriator must enter a private property. This
circumstance is present in the instant case, when by virtue of the lease agreement the Republic,
through the AFP, took possession of the property of Castellvi. Second, the entrance into private
property must be for more than a momentary period. The lease contract was for a period of one
year, renewable from year to year. The entry on the property, under the lease, is temporary, and
considered transitory. Third, the entry into the property should be under warrant or color of legal

16
authority. This circumstance in the "taking" may be considered as present in the instant case,
because the Republic entered the Castellvi property as lessee. Fourth, the property must be
devoted to a public use or otherwise informally appropriated or injuriously affected. It may be
conceded that the circumstance of the property being devoted to public use is present because
the property was used by the air force of the AFP. Fifth, the utilization of the property for public
use must be in such a way as to oust the owner and deprive him of all beneficial enjoyment of the
property. In the instant case, the entry of the Republic into the property and its utilization of the
same for public use did not oust Castellvi and deprive her of all beneficial enjoyment of the
property. Castellvi remained as owner, and was continuously recognized as owner by the
Republic. Neither was Castellvi deprived of all the beneficial enjoyment of the property, because
the Republic was bound to pay, and had been paying.
Therefore, the "taking" of the Castellvi property should not be reckoned as of the year
1947 when the Republic first occupied the same pursuant to the contract of lease, and that the
just compensation to be paid for the Castellvi property should not be determined on the basis of
the value of the property as of that year. The lower court did not commit an error when it held that
the "taking" of the property under expropriation commenced with the filing of the complaint in this
case.

9. Noble vs City of Manila

Facts:
Under a contract entered into between Jose Syquia and the City of Manila, the former constructed
on a piece of land of the latter a school building, containing twenty compartments. Clauses of the
contract provide that Mr. Syquia shall lease the building to the City for a period of not more than
three years, at a monthly rental of P600. Meaning, the City shall buy the building from Mr. Syquia
within three years from the occupancy thereof for P46,600.After sometime, with the conformity of
the city, all the rights of Syquia flowing from their contract were fully transferred to Noble. The City
of Manila failed to pay the stipulated rent corresponding to the month of February, 1934, and
following, whereupon Vicente Noble, filed the complaint which gave rise to this case, wherein he
asks that the city be ordered to purchase the building for the price of P46,600, with legal interest
thereon from the filing of the complaint, and to pay the rentals at the rate of P600 a month,
corresponding to the month of February, 1934 and following, until the purchase of the building is
effected and the price thereof paid. In this answer, the defendant City of Manila, prayed by way
of cross-complaint that the lease of the building by the city be rescinded and set aside and that
the same be expropriated.
Issue:
Whether or not the City of Manila can exercise its power of expropriation after rescinding its
contract to the plaintiff.
Held:
No. The City of Manila has no right to expropriate the building and that it should comply with the
terms of the contract, and to pay to the plaintiff, for the price of the building, plus the rentals
thereof, corresponding to the month of February, 1934 and following, until the final and absolute
conveyance of the building is made, with legal interest on the rentals due an unpaid. This being
the case, the city being bound to buy the building at an agreed price, under a valid and subsisting
contract, and the plaintiff being agreeable to its sale, the expropriation thereof, as sought by the
defendant, is baseless. Expropriation lies only when it is made necessary by the opposition of the
owner to the sale or by the lack of any agreement as to the price. There being in the present case
a valid and subsisting contract, between the owner of the building and the city, for the purchase
thereof at an agreed price, there is no reason for the expropriation. Expropriation, as a

17
manifestation of the right of eminent domain of the state and as a limitation upon private
ownership, is based upon the consideration that it should not be an obstacle to human progress
and to the development of the general welfare of the community.

10.
11. PLEASE SEE NUMBER 5
12. Land Bank vs. Dumlao (2008)

FACTS
The DUMLAOS were co-owners of a 32 hectare ricelands in Nueva Vizcaya which was placed under
OLT by virtue of PD27 (note that actual date of taking was not stated.)
The DAR made a preliminary valuation on 16 hectares (2 lots) and payments were made to the
DUMLAOs by Landbank. The DUMLAOs filed a complaint before the RTC to determine just compensation, and
requested the appointment of 3 commissioners to make the determination.
The DAR moved to dismiss claiming that the RTC does not have jurisdiction. The RTC eventually
recognized the case and ordered payment at 6,912.50 per hectare for one lot & to follow the amount provided
for in the Land Valuation Summary and Farmers Undertaking for the other lot. The DUMLAOs was claiming
market value of 109,000 per hectare.
The DUMLAOs appealed to the CA which ruled in their favor, which noted that the time of taking was
not certain. The CA held that after the passage of RA No. 6657, the formula relative to valuation under PD No.
27 no longer applies.
Under PD 27 and EO No. 228, the formula for computing the Land Value (LV) or Price Per Hectare
(PPH) of rice and corn lands is: 2.5 x AGP x GSP = LV or PPH.
Under the CARL, it is provide:
Sec. 17. Determination of Just Compensation. – In determining just compensation, the cost of
acquisition of the land, the current value of the like properties, its nature, actual use and income,
the sworn valuation by the owner, the tax declarations, and the assessment made by government
assessors shall be considered. The social and economic benefits contributed by the farmers and the
farmworkers and by the Government to the property as well as the non-payment of taxes or loans
secured from any government financing institution on the said land shall be considered as
additional factors to determine its valuation.

ISSUE
Which law should be followed to determine just compensation

HELD
(1) The just compensation due to respondents should be determined under the provisions of RA No.
6657.
The Court has repeatedly held that if just compensation was not settled prior to the passage of RA No.
6657, it should be computed in accordance with said law, although the property was acquired under PD No. 27.
The latter law, being the latest law in agrarian reform, should control, as held in Land Bank of the Philippines v.
Heirs of Angel T. Domingo.
Section 75 of RA 6657 clearly states that the provisions of PD 27 and EO 228 shall only have a
suppletory effect. Section 7 of the Act also provides
Sec. 7. Priorities. – The DAR, in coordination with the PARC shall plan and program the acquisition and
distribution of all agricultural lands through a period of ten (10) years from the effectivity of this Act. Lands shall
be acquired and distributed as follows:
Phase One: Rice and Corn lands under P.D. 27; all idle or abandoned lands; all private lands voluntarily
offered by the owners for agrarian reform; x x x and all other lands owned by the government devoted to or suitable
for agriculture, which shall be acquired and distributed immediately upon the effectivity of this Act, with the
implementation to be completed within a period of not more than four (4) years.

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 This demonstrates that RA 6657 includes PD 27 lands among the properties which the DAR shall
acquire and distribute to the landless.
DAR’s failure to determine the just compensation for a considerable length of time makes it inequitable
to follow the guidelines provided by PD No. 27 and EO No. 228. Hence, RA No. 6657 should apply.
NOTE HOWEVER that the 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 under
Section 17, as implemented through DAR Admin Order No. 6 (1992) - 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

(2) The “taking” of the properties for the purpose of computing just compensation should be reckoned
from the date of issuance of emancipation patents.

The nature of the land at that time determines the just compensation to be paid.

(3) The DUMLAOs are entitled to payment of just compensation on their entire landholdings covered
by Operation Land Transfer, except for the five hectares of retention area each of them are entitled
to (RIGHT OF RETENTION).
The determination of just compensation is judicial in nature. The DAR’s land valuation is only
preliminary and is not, by any means, final and conclusive upon the landowner or any other interested party. In
the exercise of its functions, the courts still have the final say on what the amount of just compensation will be.
A reading of Section 18 of RA No. 6657 shows that it is the courts, not the DAR, which make the final
determination of just compensation.
Also, to wait for the DAR valuation despite its unreasonable neglect and delay in processing the four
properties’ claimfolders is to violate the elementary rule that payment of just compensation must be within a
reasonable period from the taking of property.
While the DAR is vested with primary jurisdiction to determine in a preliminary manner the amount
of just compensation, the circumstances of this case militate against the application of the doctrine of primary
jurisdiction.

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