Retention Limits

No person may own or retain, directly or indirectly, any public or

private agricultural land, exceeding five (5) hectares.

Three (3) hectares may be awarded to each child of the landowner,

subject to the following qualifications: (1) that he is at least fifteen (15)
years of age; and (2) that he is actually tilling the land or directly
managing the farm.

Note:

The right to choose the area to be retained shall pertain to the

landowner: Provided that in case the area selected for retention by the
landowner is tenanted, the tenant shall have the option to choose
whether to remain therein or be a beneficiary. In case the tenant chooses
to remain in the retained area, he shall be considered a leaseholder. The
tenant must exercise this option within a period of one (1)
year from the time the landowner manifests his choice of the area
for retention.

Alita vs. CA
G.R. No. 78517, February 27, 1989

Facts: Private respondents' predecessors-in-interest acquired the subject

parcel of lands through homestead patent under the provisions of
Commonwealth Act No. 141. Private respondents herein are desirous of
personally cultivating these lands, but petitioners refuse to vacate, relying

1
on the provisions of P.D. 27 and P.D. 316. On June 18, 1981, private
respondents instituted a complaint for the declaration of P.D. 27 and all
other Decrees, Letters of Instructions and General Orders issued in
connection therewith as inapplicable to lands obtained through
homestead law. The RTC dismissed the complaint but on motion for
reconsideration it declared that P.D. 27 is not applicable to homestead
lands. On appeal to the CA, the decision of the RTC was sustained.

Issue: Whether or not lands acquired through homestead law are

covered by CARP?

Held: Petitioner is correct in saying that P.D. 27 decreeing the

emancipation of tenants from the bondage of the soil and transferring to
them ownership of the land they till is a sweeping social legislation, a
remedial measure promulgated pursuant to the social justice precepts of
the Constitution. However, such contention cannot be invoked to defeat
the very purpose of the enactment of the Public Land Act or
Commonwealth Act No. 141. The Philippine Constitution likewise respects
the superiority of the homesteaders' rights over the rights of the tenants
guaranteed by the Agrarian Reform statute. Provided, that the original
homestead grantees or their direct compulsory heirs who still own the
original homestead at the time of the approval of this Act shall retain the
same areas as long as they continue to cultivate said homestead.

2
 DAR AO 2, S. 2003 – 2003 Rules and Procedures Governing
Landowners Retention Rights

Coverage: Covers PD 27 and RA 6657 Rights:

The landowner:

 Has the right to choose the area to be retained by him and which
shall be least prejudicial to the farmers

 Shall exercise the right to retain by signifying his intention to retain

within sixty (60) days from receipt of notice of coverage.

 Shall indicate the exact location thereof within thirty (30) days from
manifestation date. Failure to do so shall authorize the Municipal
Agrarian Reform Officer (MARO) to choose said retention area.

 Has the obligation to cultivate the land directly or thru labor

administration and thereby make the area he retains productive.

Note:

The sale, lease or transfer of private lands by the original

landowner in violation of RA 6657 shall be null and void.

If the area is tenanted, the tenant shall have the option to choose
whether to remain therein as lessee or be a beneficiary. In case the
tenant declines, he may choose to be paid disturbance compensation in
such amount as may be agreed between the parties taking into

3
consideration the improvements made on the land. However, in no case
shall the agreed amount be less than five (5) times the average gross
harvest on their landholding during the last five (5) preceding calendar
years pursuant to Section 36 of RA 3844, as amended by Section 7 of RA
6389.

Exemption:

Transactions executed prior to RA 6657 shall be valid only when

registered with the Register of Deeds within a period of three (3) months
after 15 June 1988 in accordance with Section 6 of RA 6657.

Who may apply for retention?

 Any person who owns agricultural lands with area of more than five
(5) hectares. However, a landowner who exercised his right of
retention under PD 27 may no longer exercise the same right under
RA 6657.

 A landowner who owns five (5) hectares or less, of land which are
not yet subject of coverage may also file an application for retention
and a Certification of Retention shall be issued in his favor.

 Deceased landowner may be exercised by his heirs provided that

the heirs must first show proof that the decedent landowner had
manifested during his lifetime.

4
Period to Exercise Right of Retention under RA 6657

 The landowner may exercise his right of retention at any time

before receipt of notice of coverage.

 Under the Compulsory Acquisition (CA) scheme, the landowner shall

exercise his right of retention within sixty (60) days from receipt of
notice of coverage.

 Under the Voluntary Offer to Sell (VOS) and the Voluntary Land
Transfer (VLT)/Direct Payment Scheme (DPS), the landowner shall
exercise his right of retention simultaneously at the time of offer for
sale or transfer.

Note:

1. Voluntary offer to sell: scheme whereby the landowners voluntarily

offer their agricultural lands for coverage regardless of phasing

2. Voluntary land transfer/direct payment scheme: landowner and

the beneficiary enter into a voluntary agreement for the direct transfer of
lands to the latter

3. Compulsory acquisition: whereby the land is expropriated by the

State (Section 16 of RA 6657)

5
 Exemptions and Exclusions

Exemptions:

1) Lands actually, directly and exclusively used for parks, wildlife, forest
reserves, reforestation, fish sanctuaries and breeding grounds,
watersheds and mangroves

2) Private lands actually, directly and exclusively used for prawn farms
and fishponds

Note:

 Such prawn farms and fishponds have not been distributed

 No Certificate of Land Ownership Award (CLOA) has been issued to
agrarian reform beneficiaries

3) Lands actually, directly and exclusively used and found to be necessary

for national defense, school sites and campuses, including experimental
farm stations operated by public or private schools for educational
purposes, seeds and seedling research and pilot production center,
church sites and convents appurtenant thereto, mosque sites and Islamic
centers appurtenant thereto, communal burial grounds and cemeteries,
penal colonies and penal farms actually worked by the inmates,
government and private research and quarantine centers and all lands
with eighteen percent (18%) slope and over (Exception: those already
developed)

6
Section 3(c) of RA 6657, in relation to DOJ Opinion 44 s. 1990 and
the case of Natalia Realty vs. DAR

Section 3(c) of RA 6657 defines Agricultural Land as land devoted to

agricultural activity as defined in this Act and not classified as mineral,
forest, residential, commercial or industrial land.

DOJ Opinion 44 s. 1990 was penned by Franklin Drilon who was then
the Justice Secretary, in response to a query by the Secretary of Agrarian
Reform. He recognized the fact that before the date of the law’s
effectivity on June 15, 1988, the reclassification or conversion of lands
was not exclusively done by the DAR but a “coordinated effort” of all
concerned agencies, such as: National Planning Commission, Human
Settlements Commission (HSC), Department of Local Government and
Community Development (DLGCD), Ministry of Human Settlements,
Human Settlements Regulatory Commission (predecessors of the HLURB).
The authority of the DAR to approve conversions could be exercised only
from the date of the law’s effectivity on June 15, 1988.

He noted that lands covered by Presidential Proclamation No. 1637, of

which the NATALIA lands are part, having been reserved for townsite
purposes "to be developed as human settlements by the proper land and
housing agency," are "not deemed 'agricultural lands' within the meaning
and intent of Section 3 (c) of R.A. No. 6657." Not being deemed
"agricultural lands," they are outside the coverage of CARL.

7
 Natalia Realty vs. DAR
G.R. No. 103302 August 12, 1993

Facts: Petitioner Natalia Realty’s (NATALIA) properties are situated within

the areas proclaimed as townsite reservation, by virtue of Presidential
Proclamation No. 1673 promulgated in 1979. Petitioner Estate Developers
and Investors Corporation (EDIC), as developer of NATALIA, applied for
and was granted preliminary approval locational clearances by the Human
Settlements Regulatory Commission. Thus, the NATALIA became the
Antipolo Hills Subdivision. On 15 June 1988, R.A. 6657, otherwise known
as the "Comprehensive Agrarian Reform Law of 1988" went into effect.
Respondent DAR issued a Notice of Coverage on the undeveloped portion
of the Antipolo Hills Subdivision.

Petitioner contends that the properties already ceased to be agricultural

lands when they were included in the areas reserved by presidential fiat
for the townsite reservation. Respondent on the other hand contends that
no application for conversion of NATALIA lands from agricultural to
residential was ever filed with the DAR. In other words, there was no
valid conversion.

Issue: Are lands already classified for residential, commercial or

industrial use, as approved prior to June 15, 1988, covered by R.A. 6657?

Ruling: No. Sec. 3 defines Agricultural Land as land devoted to

agricultural activity and not classified as mineral, forest, residential,
commercial, industrial land. The undeveloped portions of the Antipolo
Hills Subdivision ceased to be agricultural lands upon approval of their
inclusion in the Lungsod Silangan Reservation. Lands not devoted to

8
agricultural activity are outside the coverage of CARL. These include lands
that were previously converted to non-agricultural uses prior to the
effectivity of CARL by government agencies other than respondent DAR.
Since the NATALIA lands were converted prior to 15 June 1988,
respondent DAR is bound by such conversion. It was therefore error to
include the undeveloped portions of the Antipolo Hills Subdivision within
the coverage of CARL.

DAR AO 13, S. 1990 – Rules and Procedures Governing Exemption

of Lands from CARP Coverage under Section 10, R.A. 6657

Legal Mandate

The general policy under CARP is to cover as much lands suitable

for agriculture as possible. However, Section 10, R.A. 6657 excludes and
exempts certain types of lands from the coverage of CARP.

Lands actually, directly and exclusively used and found to be

necessary for parks, wildlife, forest reserves, reforestation, fish
sanctuaries and breeding grounds, watersheds and mangroves, national
defense, school sites and campuses including experimental farm stations
operated by public or private schools for educational purposes, seeds and
seedlings research and pilot production centers, church sites and
convents appurtenant thereto, mosque sites and Islamic centers
appurtenant thereto, communal burial grounds and cemeteries, penal
colonies and penal farms actually worked by the inmates, government
and private research and quarantine centers; and all lands with eighteen
percent (18%) slope and over, except those already developed.

9
 Guidelines:

 For an area in I.A above to be exempted from CARP coverage, it

must be "actually, directly and exclusively used and found to be
necessary" for the purpose so stated.

 The security of tenure of tenants enjoyed prior to 15 June 1988

shall be respected even if the land is exempted. As to farmworkers,
they shall be granted preference in the award of other lands
covered by CARP.

 Lands which have been classified as exempt, shall be exempted

from the coverage of CARP until Congress reclassifies the said areas
or portions thereof as alienable and disposable has been approved.

 Lands which have been actually, directly and exclusively used and
found to be necessary for reforestation are likewise excluded and
exempted from the coverage of the CARP, Lands which have been
actually, directly and exclusively used and found to be necessary for
reforestation are likewise excluded and exempted from the
coverage of the CARP.

 If the purpose for the grant of exemption no longer exists, the area
or portion involved shall be covered under CARP pursuant to the
guidelines on land acquisition and distribution.

 All lands with a slope of eighteen percent (18%) and over are
exempt from land acquisition and distribution. However those with

10
 18% slope and over but already developed for agricultural purposes
as of 15 June 1988 shall be allocated to qualified occupants.

Note:

 If classified as forest land, they shall be allocated by the DENR

under the Integrated Social Forestry Program.

 If classified as alienable and disposable, they shall be allocated by

LMB-DENR and DAR pursuant to the provisions of the Public Land
Act and the Joint DAR-DENR Administrative Order No. 2, series of
1988.

Milestone Farms Inc. vs. Office of the President

G.R. 182332 February 23, 2011

Facts: Among the pertinent secondary purposes of Milestone Farms are

1) to engage in the raising of cattle, pigs, and other livestock; 2) to
breed, raise, and sell poultry; and 3) to import cattle, pigs, and other
livestock, and animal food necessary for the raising of said cattle, pigs,
and other livestock.

On June 10, 1988, CARL took effect. In 1993, petitioner applied for the
exemption/exclusion of its 316.0422-hectare property pursuant to the
ruling in Luz Farms case. Meanwhile, on December 27, 1993, DAR issued
AO No. 9, Series of 1993, setting forth rules and regulations to govern
the exclusion of agricultural lands used for livestock, poultry, and swine
raising from CARP coverage. The AO sought to regulate livestock farms

11
by prescribing a maximum retention limit for their ownership. Milestone
re-documented its application pursuant to said AO.

DAR Regional Director Dalugdug exempted petitioner’s 316.0422-hectare

property from the coverage of CARP. However, the Pinugay Farmers
moved for the reconsideration, but the same was denied. Hence, they
filed an appeal with DAR Secretary.

DAR Secretary Garilao issued an Order exempting from CARP only

240.9776 hectares of the 316.0422 hectares previously exempted by
Director Dalugdug, and declaring 75.0646 hectares of the property to be
covered by CARP. The Office of the President primarily reinstated the
decision of Director Dalugdug but when the farmers filed a MR, Office of
the President reinstated the decision of Director Garilao.

CA primarily ruled in favor of Milestone in exempting the entire property

from the coverage of CARP. However, six months earlier, without the
knowledge of the CA – then DAR Secretary Villa issued DAR conversion
order granting petitioner’s application to convert portions of the
316.0422-hectare property from agricultural to residential and golf
courses use.

When the CA was made aware of these developments, it had to

acknowledge that the property subject of the controversy would now be
limited to the remaining 162.7373 hectares. CA, in its amended decision,
states that the subject landholding from the coverage of CARP is hereby
lifted, and the 162.7373 hectare-agricultural portion thereof is hereby
declared covered by the CARP.

12
Issue: Whether or not Milestone’s entire property should be exempted
from the coverage of CARP?

Ruling: NO. When CA made its decision, DAR AO No. 9 was not yet
declared unconstitutional by the Supreme Court. Thus, it could not be
said that the CA erred or gravely abused its discretion in respecting the
mandate of DAR A.O. No. 9, which was then subsisting and in full force
and effect. As correctly held by respondent OP, the CA correctly held that
the subject property is not exempt from the coverage of the CARP, as
substantial pieces of evidence show that the said property is not
exclusively devoted to livestock, swine, and/or poultry raising.

The deliberations of the 1987 Constitutional Commission show a clear

intent to exclude all lands exclusively devoted to livestock, swine and
poultry-raising. The Court clarified in the Luz Farms case that livestock,
swine and poultry-raising are industrial activities and do not fall within
the definition of "agriculture" or "agricultural activity." The raising of
livestock, swine and poultry is different from crop or tree farming. It is an
industrial, not an agricultural, activity.

Luz Farms vs. The Honorable Secretary of DAR

G.R. No. 86889 December 4, 1990

Facts: On June 10, 1988, R.A. No. 6657 was approved, which includes
the raising of livestock, poultry and swine in its coverage. Luz Farms,
petitioner in this case, is a corporation engaged in the livestock and
poultry business and allegedly stands to be adversely affected by the
enforcement of Section 3(b), Section 11, Section 13, Section 16(d) and

13
17 and Section 32 of R.A. No. 6657 and of the Guidelines and Procedures
Implementing Production and Profit Sharing under R.A. No. 6657 and the
Rules and Regulations Implementing Section 11 thereof.

Petitioner prayed that aforesaid laws, guidelines and rules be declared

unconstitutional. 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 . . ."

Issue: Whether Sections 3(b), 11, 13 and 32 of R.A. No. 6657 are
constitutional, insofar as the said law includes the raising of livestock,
poultry and swine in its coverage as well as the Implementing Rules and
Guidelines promulgated in accordance therewith.

Ruling: YES. Section II of R.A. 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. There is simply no reason to
include livestock and poultry lands in the coverage of agrarian reform.

Looking into the transcript of the Constitutional Commission on the

meaning of the word “agriculture”, it showed that the framers never

14
intended to include livestock and poultry industry in the coverage of the
constitutionally mandated agrarian reform program of the government.

Further, Commissioner Tadeo pointed out that the reason why they used
the term “farmworkers” rather than “agricultural workers” in the said law
is because “agricultural workers” includes the livestock and poultry
industry, hence, since they do not intend to include the latter, they used
“farmworkers” to have distinction.

DAR vs. Sutton

G.R. No. 162070, October 19, 2005

Facts: The case at bar involves a land in Aroroy, Masbate, inherited by

respondents which has been devoted exclusively to cow and calf
breeding. In 1987, pursuant to the then existing agrarian reform program
of the government, respondents made a voluntary offer to sell (VOS)
their landholdings to petitioner DAR to avail of certain incentives under
the law. In view of the Luz Farms ruling, respondents filed with petitioner
DAR a formal request to withdraw their VOS.

MARO recommended to the DAR Secretary that it be exempted from the

coverage of the CARL. On December 27, 1993, DAR issued A.O. No. 9,
series of 1993, which provided that only portions of private agricultural
lands used for the raising of livestock, poultry and swine as of June 15,
1988 shall be excluded from the coverage of the CARL.

The AO fixed the following retention limits, viz: 1:1 animal-land ratio
(i.e., 1 hectare of land per 1 head of animal shall be retained by the

15
landowner), and a ratio of 1.7815 hectares for livestock infrastructure for
every 21 heads of cattle shall likewise be excluded from the operations of
the CARL.

Applying the retention limits outlined in the AO, petitioner exempted

1,209 hectares of respondents land for grazing purposes, and a maximum
of 102.5635 hectares for infrastructure. Respondents moved for
reconsideration, contending that their entire landholding should be
exempted as it is devoted exclusively to cattle-raising. Their motion was
denied.

On appeal with the Office of the President (OP), respondents assailed (1)
the reasonableness and validity of DAR A.O. No. 9, s. 1993 which
provided for a ratio between land and livestock and (2) the
constitutionality of DAR A.O. No. 9, s. 1993, in view of the Luz Farms
case which declared cattle-raising lands excluded from the coverage of
agrarian reform.

The Office of the President affirmed the impugned Order of petitioner

DAR. DAR A.O. No. 9, s. 1993, does not run counter to the Luz Farms
case as the AO provided the guidelines to determine whether a certain
parcel of land is being used for cattle-raising.

On appeal, CA ruled in favor of the respondents. It declared DAR A.O. No.

9, s. 1993, void for being contrary to the intent of the 1987 Constitutional
Commission to exclude livestock farms from the land reform program of
the government.

16
Issue: Whether or not DAR A.O. No. 9, series of 1993, which prescribes a
maximum retention limit for owners of lands devoted to livestock raising,
is unconstitutional.

Ruling: YES. The A.O. sought to regulate livestock farms by including

them in the coverage of agrarian reform and prescribing a maximum
retention limit for their ownership. However, the deliberations of the 1987
Constitutional Commission show a clear intent to exclude all lands
exclusively devoted to livestock, swine and poultry- raising. It is an
industrial, not an agricultural, activity.

DAR has no power to regulate livestock farms which have been exempted
by the Constitution from the coverage of agrarian reform. Lands devoted
to raising of livestock, poultry and swine have been classified as
industrial, not agricultural, lands and thus exempt from agrarian reform.

Respondents’ family acquired their landholdings as early as 1948. They

have long been in the business of breeding cattle in Masbate which is
popularly known as the cattle-breeding capital of the Philippines. There is
no evidence on record that respondents have just recently engaged in or
converted to the business of breeding cattle after the enactment of the
CARL that may lead one to suspect that respondents intended to evade
its coverage.

It must be stressed that what the CARL prohibits is the conversion of

agricultural lands for non-agricultural purposes after the effectivity of the
CARL. There has been no change of business interest in the case of
respondents.

17
 Republic Act No. 7881
March 12, 1995

Republic Act No. 7881 amended certain provisions of R.A. 6657, to wit:

• Section 3(b) - definition of Agriculture, Agricultural Enterprise or

Agricultural Activity
• Section 10 - Exemptions and Exclusions
• Section 11 - Commercial Farming
• Section 32 - Incentives
• Section 65 - Conversion into Fishpond and Prawn Farms
• Section 65-B - Inventory
• Section 65-C - Protection of Mangrove Areas
• Section 65-D - Change of Crops
• Section 73-A - Exceptions

What are the amendments in relation to Lands Actually, Directly

and Exclusively Used for Prawn Farms and Fishponds?

• Section 1 of RA 7881 amends Section 3-b of RA 6657 as it pertains

to the definition of agricultural activity.

• Section 2 of the same law also amends Section 10 or CARL by

exempting private lands actually, directly and exclusively used for
prawn farms and fishponds as of March 12, 1995, provided that
said lands have not been distributed and no CLOAs have been
issued.

18
 • Section 3 of RA 7881 amends Section 11 of RA 6657 by excluding
commercial livestock, poultry and swine raising and aquaculture,
including fishponds and prawn farms from the classification of
commercial farms that are due for coverage under the CARP after a
ten-year deferment period.

• Sec. 4 of RA 7881 incorporates a new provision under Sec. 32 of RA

6657. Sec. 32A of RA 7881 mandates individuals or entities owning
or operating fishponds and prawn farms to execute within 6 mos.
from effectivity of RA 7881, a Profit Incentive Plan providing their
regular fishpond or prawn farm workers with 7.5% share of net
profit before tax from the operation of the fishponds or prawn
farms. The incentive shall be distributed within 60 days at the end
of the fiscal year over and above the compensation they currently
receive.

DAR Administrative Order No. 3, s. of 1995

Salient Features:

 The AO expressly respects and acknowledges the tenancy

relationship that existed between the parties prior to the
amendments made to Republic Act No. 6657 by Republic Act No.
7881, that is, before fishponds and prawn farms were
exempted/excluded from the coverage of the CARL. A profit-sharing
incentive plan of 7.5% of the net profit before tax derived from the
operation of fishponds and prawn farms are to be given to regular
workers over and above the compensation they regularly receive.

19
  Private agricultural lands actually, directly and exclusively used for
prawn farms and fishponds as of March 12, 1995 are exempt from
the coverage of CARP; Provided, that the said lands have not been
distributed to Agrarian Reform Beneficiaries with the corresponding
CLOAs issued.

What if lands have been subjected to CARP?

 Lands used for fishponds or prawn farms will only be exempt from
CARP coverage only upon the consent of a simple and absolute
majority of the actual regular workers/tenants within 1 year from
March 12, 1995
 In case tenants/workers object, the fishponds/prawn farms shall be
distributed collectively to the worker-beneficiaries/tenants
 Fishpond/prawn farmworkers affected by exemption/exclusion have
the option to remain as such OR become beneficiaries

Operating Procedures:

a. Landowner - Files written application for Land Exemption/ Exclusion

accompanied by:

- Ownership documents (OCT/TCT)

- Certified true copy of business permit
- Certified true copies of Individual ITR or Corporate ITR covering 3
calendar years immediately preceding March 8, 1995
- Certified true copy of the Certificate of Registration issued by SEC
(if corporation)

20
 - Location plan/vicinity map of property
- Sketch plan of area
- Profit Incentive Plan

b. DAR Provincial Office (DARPO)

Responsibilities:
- conducts with the assistance of the BARC, MARO and BFAR an
ocular inspection
- Prepare report of findings and recommendations
- Compile all relevant documents to form the Application for Land
Exclusion Folder (ALEF) and transmit to RD

c. Regional Director (RD)

Responsibilities:

- Review and evaluate report

- If documents are in order, issue Order of Approval / Denial,
otherwise return the ALEF to the DARPO for further action
- Forward the Order of Approval / Denial to PARO for distribution
- In case of denial of the application for exclusion, DAR Regional
Office (DARRO) through the DARPO and DAR Municipal Office
(DARMO) shall cause the acquisition and distribution of the property

21
Review and Revision / Revocation of Exclusion Order

- Performed by the Office of the Undersecretary for Field Operations,

through the report of the MAROs, cases wherein the bases for which
exclusions were granted no longer exist

Monitoring

- MARO shall conduct a continuing review and verification of

exempted/excluded lands to ascertain whether the subject lands
are no longer used for fishpond or prawn farm purposes

Sanction

- Willful violation or prevention of the implementation of these rules

and regulations shall make a person liable under Section 74 of RA
6657 and other penalties provided for by law (imprisonment of not
less than 1 month to not more than 3 years or a fine of not less
than P1,000.00 and not more than fifteen thousand pesos
P15,000.00, or both, at the discretion of the court)
- If offender is a corporation or association, the officer responsible
shall be criminally liable

22
 Central Mindanao University vs. Department of Agrarian Reform
Adjudication Board
215 SCRA 86 (1992)

Facts: On 16 January 1958, President Carlos Garcia issued Proclamation

No. 467 reserving for the Mindanao Agricultural College, now the CMU, a
piece of land to be used as its future campus. In 1984, CMU embarked on
a project titled "Kilusang Sariling Sikap" wherein parcels of land were
leased to its faculty members and employees. Under the terms of the
program, CMU will assist faculty members and employee groups through
the extension of technical know-how, training and other kinds of
assistance. In turn, they paid the CMU a service fee for use of the land.
The agreement explicitly provided that there will be no tenancy
relationship between the lessees and the CMU.

When the program was terminated, a case was filed by the participants of
the "Kilusang Sariling Sikap" for declaration of status as tenants under
the CARP. In its resolution, DARAB, ordered, among others, the
segregation of 400 hectares of the land for distribution under CARP. The
land was subjected to coverage on the basis of DAR's determination that
the lands do not meet the condition for exemption, that is, it is not
"actually, directly, and exclusively used" for educational purposes.

Issue: Is the CMU land covered by CARP? Who determines whether lands
reserved for public use by presidential proclamation is no longer actually,
directly and exclusively used and necessary for the purpose for which
they are reserved?

23
Held: The land is exempted from CARP. CMU is in the best position to
resolve and answer the question of when and what lands are found
necessary for its use. The Court also chided the DARAB for resolving this
issue of exemption on the basis of "CMU's present needs." The Court
stated that the DARAB decision stating that for the land to be exempt it
must be "presently, actively exploited and utilized by the university in
carrying out its present educational program with its present student
population and academic faculty" overlooked the very significant factor of
growth of the university in the years to come.

Department of Agrarian Reform vs. Department of Education,

Culture and Sports (DECS)
G.R. No. 158228 March 23, 2004

Facts: Lot No. 2509 and Lot No. 817-D which were donated by the late
Esteban Jalandoni to Respondent DECS (formerly Bureau of Education).
Consequently, titles thereto were transferred in the name of respondent
DECS. Respondent DECS leased the lands to Anglo Agricultural
Corporation for 10 agricultural crop years, commencing from 1984-1994.
The contract of lease was subsequently renewed for another 10
agricultural crop years or until 2005. On June 10, 1993, Eugenio Alpar
and several others, claiming to be permanent and regular farm workers of
the subject lands, filed a petition for Compulsory Agrarian Reform
Program (CARP) coverage with the Municipal Agrarian Reform Office
(MARO) of Escalante. After investigation, MARO Jacinto R. Piñosa, sent a
"Notice of Coverage" to respondent DECS, stating that the subject lands
are now covered by CARP and inviting its representatives for a conference

24
with the farmer beneficiaries. The recommendation for coverage was
approved by DAR Regional Director Dominador B. Andres.

Respondent DECS appealed the case to the Secretary of Agrarian Reform

which affirmed the Order of the Regional Director. Respondent DECS filed
a petition for certiorari with the Court of Appeals, which set aside the
decision of the Secretary of Agrarian Reform. Hence, the instant petition
for review.

Issue: Whether or not the subject properties are exempt from the
coverage of Republic Act No. 6657, otherwise known as the
Comprehensive Agrarian Reform Law of 1998 (CARL).

Held: NO. While respondent DECS sought exemption from CARP coverage
on the ground that all the income derived from its contract of lease with
Anglo Agricultural Corporation were actually, directly and exclusively used
for educational purposes, such as for the repairs and renovations of
schools in the nearby locality, the court is inclined with the petitioner’s
argument that the lands subject hereof are not exempt from the CARP
coverage because the same are not actually, directly and exclusively used
as school sites or campuses, as they are in fact leased to Anglo
Agricultural Corporation. Further, to be exempt from the coverage, it is
the land per se, not the income derived therefrom, that must be actually,
directly and exclusively used for educational purposes. Section 10 of R.A.
No. 6657 enumerates the types of lands which are exempted from the
coverage of CARP as well as the purposes of their exemption specifying
those “lands actually, directly and exclusively used and found to be
necessary for national defense, school sites and campuses, including
experimental farm stations operated by public or private schools for

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educational purposes, …, shall be exempt from the coverage of this Act.”
Clearly, a reading of the paragraph shows that, in order to be exempt
from the coverage: 1) the land must be "actually, directly, and
exclusively used and found to be necessary;" and 2) the purpose is "for
school sites and campuses, including experimental farm stations operated
by public or private schools for educational purposes."

Province of Camarines Sur vs Court of Appeals

G.R. No. 103125, May 17, 1993

Facts: December 1988, Sangguniang Panlalawigan of CamSur authorized

the provincial governor to purchase or expropriate property contiguous to
the provincial capitol site in order to establish a pilot farm for non-food
and non-traditional agricultural crops and a housing project for provincial
government employees.

Pursuant to the resolution, Gov. Villafuerte filed two separate cases for
expropriation against Ernesto San Joaquin and Efren San Joaquin. Upon
motion for the issuance of writ or possession, San Joaquins failed to
appear at the hearing.

San Joaquins later moved to dismiss the complaints on the ground of

inadequacy of the price offered for their property. The court denied the
motion to dismiss and authorized the province to take possession of the
properties.

San Joaquins filed for motion for relief, but denied as well. In their
petition. Asked by the CA, Solicitor General stated that there is no need

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for the approval of the president for the province to expropriate
properties, however, the approval of the DAR is needed to convert the
property from agricultural to non-agricultural (housing purpose).

CA set aside the decision of the trial court suspending the possession and
expropriation of the property until th province has acquired the approval
of DAR. Hence, this petition.

Issue: Whether the expropriation of agricultural lands by LGU is subject

to prior approval of the DAR.

Held: The rules on conversion of agricultural lands found in Section 4 (k)

and 5 (1) of Executive Order No. 129-A, Series of 1987, cannot be the
source of the authority of the Department of Agrarian Reform to
determine the suitability of a parcel of agricultural land for the purpose to
which it would be devoted by the expropriating authority. While those
rules vest on the Department of Agrarian Reform the exclusive authority
to approve or disapprove conversions of agricultural lands for residential,
commercial or industrial uses, such authority is limited to the applications
for reclassification submitted by the land owners or tenant beneficiaries.

To sustain the Court of Appeals would mean that the local government
units can no longer expropriate agricultural lands needed for the
construction of roads, bridges, schools, hospitals, etc, without first
applying for conversion of the use of the lands with the Department of
Agrarian Reform, because all of these projects would naturally involve a
change in the land use. In effect, it would then be the Department of
Agrarian Reform to scrutinize whether the expropriation is for a public
purpose or public use.

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 Roxas & Company, Inc. vs. DAMBA-NFSW and the Department of
Agrarian Reform
G.R. No. 149548 December 14, 2010

Facts: Roxas & Co. is a domestic corporation and is the registered owner
of three haciendas. 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 affectivity, on
May 6, 1988, filed with respondent DAR a voluntary offer to sell 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. On August 6, 1992, through its President, 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. The petitions nub on the interpretation of Presidential
Proclamation 1520 reads: DECLARING THE MUNICIPALITIES OF
MARAGONDON AND TERNATE IN CAVITE PROVINCE AND THE
MUNICIPALITY OF NASUGBU IN BATANGAS AS A TOURISTZONE, AND
FOR OTHER PURPOSES Essentially, Roxas & Co. filed its application for
conversion of its three haciendas from agricultural 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

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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. 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 which states that all
lands already classified as commercial, industrial, or residential before the
affectivity of CARP no longer need conversion clearance from the DAR.

Issue: Whether the subject lands are exempt from Comprehensive

Agrarian Reform Program (CARP) coverage.

Held: NO. While the Court acknowledged the passage of the Tourism Act
as another vehicle for potential tourism areas to be exempted from CARP
coverage, that did not in any way pronounce as meritorious Roxas & Co.’s
subsequent application with the TIEZA to declare its properties as tourism
enterprise zones. That is for the TIEZA, not this Court, to determine.
Whatever decision the TIEZA renders in Roxas & Co.’s application does
not in any way affect the merits of these consolidated cases. Roxas & Co.
is merely nitpicking on the issue. Since the DAR had initially issued CLOAs
to the farmer-beneficiaries of the nine parcels of land in Hacienda Palico,
the assailed Decision merely reiterated the original designation of the
affected individuals as farmer-beneficiaries who should be entitled to
disturbance compensation before the cancellation of their respective
CLOAs is effected. This is in pursuance of the directive of DAR
Administrative Order No. 6 (Series of 1994) which mandates the payment
of disturbance compensation before Roxas & Co.’s application for
exemption may be completely granted. With regard [to] the allegation
that oppositors-movants are already CLOA holders of subject propert[ies]

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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 CLOA’s 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.

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