Republic of the Philippines the subdivision project, which consisted of 13.
lippines the subdivision project, which consisted of 13.2371 hectares, was issued sometime
SUPREME COURT
Manila
EN BANC
G.R. No. 103302 August 12, 1993
NATALIA REALTY, INC., AND ESTATE DEVELOPERS AND INVESTORS
CORP., petitioners,
vs.
DEPARTMENT OF AGRARIAN REFORM, SEC. BENJAMIN T. LEONG
and DIR. WILFREDO LEANO, DAR REGION IV, respondents.
Lino M. Patajo for petitioners.
The Solicitor General for respondents.
BELLOSILLO, J.:
Are lands already classified for residential, commercial or industrial use, as
approved by the Housing and Land Use Regulatory Board and its precursor
agencies 1 prior to 15 June 1988, 2 covered by R.A. 6657, otherwise known as the
Comprehensive Agrarian Reform Law of 1988? This is the pivotal issue in this
petition for certiorari assailing the Notice of Coverage 3 of the Department of
Agrarian Reform over parcels of land already reserved as townsite areas before the
enactment of the law.
Petitioner Natalia Realty, Inc. (NATALIA, for brevity) is the owner of three (3)
contiguous parcels of land located in Banaba, Antipolo, Rizal, with areas of
120.9793 hectares, 1.3205 hectares and 2.7080 hectares, or a total of 125.0078
hectares, and embraced in Transfer Certificate of Title No. 31527 of the Register of
Deeds of the Province of Rizal.
On 18 April 1979, Presidential Proclamation No. 1637 set aside 20,312 hectares of
land located in the Municipalities of Antipolo, San Mateo and Montalban as
townsite areas to absorb the population overspill in the metropolis which were
designated as the Lungsod Silangan Townsite. The NATALIA properties are
situated within the areas proclaimed as townsite reservation.
Since private landowners were allowed to develop their properties into low-cost
housing subdivisions within the reservation, petitioner Estate Developers and
Investors Corporation (EDIC, for brevity), as developer of NATALIA properties,
applied for and was granted preliminary approval and locational clearances by the
Human Settlements Regulatory Commission. The necessary permit for Phase I of
Respondents conclude, as a consequence, that petitioners failed to fully exhaust
in 1982; 4 for Phase II, with an area of 80,000 hectares, on 13 October 1983; 5 and
for Phase III, which consisted of the remaining 31.7707 hectares, on 25 April
1986. 6 Petitioner were likewise issued development permits 7 after complying with
the requirements. Thus the NATALIA properties later became the Antipolo Hills
Subdivision.
On 15 June 1988, R.A. 6657, otherwise known as the "Comprehensive Agrarian
Reform Law of 1988" (CARL, for brevity), went into effect. Conformably
therewith, respondent Department of Agrarian Reform (DAR, for brevity), through
its Municipal Agrarian Reform Officer, issued on 22 November 1990 a Notice of
Coverage on the undeveloped portions of the Antipolo Hills Subdivision which
consisted of roughly 90.3307 hectares. NATALIA immediately registered its
objection to the notice of Coverage.
EDIC also protested to respondent Director Wilfredo Leano of the DAR Region IV
Office and twice wrote him requesting the cancellation of the Notice of Coverage.
On 17 January 1991, members of the Samahan ng Magsasaka sa Bundok Antipolo,
Inc. (SAMBA, for the brevity), filed a complaint against NATALIA and EDIC
before the DAR Regional Adjudicator to restrain petitioners from developing areas
under cultivation by SAMBA members. 8 The Regional Adjudicator temporarily
restrained petitioners from proceeding with the development of the subdivision.
Petitioners then moved to dismiss the complaint; it was denied. Instead, the
Regional Adjudicator issued on 5 March 1991 a Writ of Preliminary Injunction.
Petitioners NATALIA and EDIC elevated their cause to the DAR Adjudication
Board (DARAB); however, on 16 December 1991 the DARAB merely remanded
the case to the Regional Adjudicator for further proceedings. 9
In the interim, NATALIA wrote respondent Secretary of Agrarian Reform
reiterating its request to set aside the Notice of Coverage. Neither respondent
Secretary nor respondent Director took action on the protest-letters, thus compelling
petitioners to institute this proceeding more than a year thereafter.
NATALIA and EDIC both impute grave abuse of discretion to respondent DAR for
including undedeveloped portions of the Antipolo Hills Subdivision within the
coverage of the CARL. They argue that NATALIA properties already ceased to be
agricultural lands when they were included in the areas reserved by presidential fiat
for the townsite reservation.
Public respondents through the Office of the Solicitor General dispute this
contention. They maintain that the permits granted petitioners were not valid and
binding because they did not comply with the implementing Standards, Rules and
Regulations of P.D. 957, otherwise known as "The Subdivision and Condominium
Buyers Protective Decree," in that no application for conversion of the NATALIA
lands from agricultural residential was ever filed with the DAR. In other words,
there was no valid conversion. Moreover, public respondents allege that the instant
petition was prematurely filed because the case instituted by SAMBA against
petitioners before the DAR Regional Adjudicator has not yet terminated.
administrative remedies available to them before coming to court.
The petition is impressed with merit. A cursory reading of the Preliminary Approval
and Locational Clearances as well as the Development Permits granted petitioners
for Phases I, II and III of the Antipolo Hills Subdivision reveals that contrary to the
claim of public respondents, petitioners NATALIA and EDIC did in fact comply
with all the requirements of law.
Petitioners first secured favorable recommendations from the Lungsod Silangan
Development Corporation, the agency tasked to oversee the implementation of the
development of the townsite reservation, before applying for the necessary permits
from the Human Settlements Regulatory
Commission. 10 And, in all permits granted to petitioners, the Commission
stated invariably therein that the applications were in "conformance" 11 or
"conformity" 12 or "conforming" 13 with the implementing Standards, Rules and
Regulations of P.D. 957. Hence, the argument of public respondents that not all of
the requirements were complied with cannot be sustained.
As a matter of fact, there was even no need for petitioners to secure a clearance or
prior approval from DAR. The NATALIA properties were within the areas set aside
for the Lungsod Silangan Reservation. Since Presidential Proclamation No. 1637
created the townsite reservation for the purpose of providing additional housing to
the burgeoning population of Metro Manila, it in effect converted for residential use
what were erstwhile agricultural lands provided all requisites were met. And, in the
case at bar, there was compliance with all relevant rules and requirements. Even in
their applications for the development of the Antipolo Hills Subdivision, the
predecessor agency of HLURB noted that petitioners NATALIA and EDIC
complied with all the requirements prescribed by P.D. 957.
The implementing Standards, Rules and Regulations of P.D. 957 applied to all
subdivisions and condominiums in general. On the other hand, Presidential
Proclamation No. 1637 referred only to the Lungsod Silangan Reservation, which
makes it a special law. It is a basic tenet in statutory construction that between a
general law and a special law, the latter prevails. 14
Interestingly, the Office of the Solicitor General does not contest the conversion of
portions of the Antipolo Hills Subdivision which have already been developed. 15 Of
course, this is contrary to its earlier position that there was no valid conversion. The
applications for the developed and undeveloped portions of subject subdivision
were similarly situated. Consequently, both did not need prior DAR approval.
We now determine whether such lands are covered by the CARL. Section 4 of R.A.
6657 provides that the CARL shall "cover, regardless of tenurial arrangement and
commodity produced, all public and private agricultural lands." As to what
constitutes "agricultural land," it is referred to as "land devoted to agricultural
activity as defined in this Act and not classified as mineral, forest, residential,
commercial or industrial land." 16 The deliberations of the Constitutional
Commission confirm this limitation. "Agricultural lands" are only those lands
which are "arable and suitable agricultural lands" and "do not include commercial,
industrial and residential lands." 17
Based on the foregoing, it is clear that the undeveloped portions of the Antipolo
Hills Subdivision cannot in any language be considered as "agricultural lands."
These lots were intended for residential use. They ceased to be agricultural lands
upon approval of their inclusion in the Lungsod Silangan Reservation. Even today,
the areas in question continued to be developed as a low-cost housing subdivision,
albeit at a snail's pace. This can readily be gleaned from the fact that SAMBA
members even instituted an action to restrain petitioners from continuing with such
development. The enormity of the resources needed for developing a subdivision
may have delayed its completion but this does not detract from the fact that these
lands are still residential lands and outside the ambit of the CARL.
Indeed, lands not devoted to agricultural activity are outside the coverage of CARL.
These include lands previously converted to non-agricultural uses prior to the
effectivity of CARL by government agencies other than respondent DAR. In its
Revised Rules and Regulations Governing Conversion of Private Agricultural
Lands to Non-Agricultural Uses, 18 DAR itself defined "agricultural land" thus
. . . Agricultural lands refers to those devoted to agricultural
activity as defined in R.A. 6657 and not classified as mineral
or forest by the Department of Environment and Natural
Resources (DENR) and its predecessor agencies, and not
classified in town plans and zoning ordinances as approved
by the Housing and Land Use Regulatory Board (HLURB)
and its preceding competent authorities prior to 15 June
1988 for residential, commercial or industrial use.
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.
Be that as it may, the Secretary of Justice, responding to a query by the Secretary of
Agrarian Reform, noted in an Opinion 19 that lands covered by Presidential
Proclamation No. 1637, inter alia, 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.
Anent the argument that there was failure to exhaust administrative remedies in the
instant petition, suffice it to say that the issues raised in the case filed by SAMBA
members differ from those of petitioners. The former involve possession; the latter,
the propriety of including under the operation of CARL lands already converted for
residential use prior to its effectivity.
Besides, petitioners were not supposed to wait until public respondents acted on
their letter-protests, this after sitting it out for almost a year. Given the official
indifference, which under the circumstances could have continued forever,
petitioners had to act to assert and protect their interests. 20
In fine, we rule for petitioners and hold that public respondents gravely abused their 14 National Power Corporation v. Presiding Judge, RTC, Br.
discretion in issuing the assailed Notice of Coverage of 22 November 1990 by of XXV, G.R. No. 72477, 16 October 1990, 190 SCRA 477.
lands over which they no longer have jurisdiction.
15 Comment, p. 8; Rollo, p. 63.
WHEREFORE, the petition for Certiorari is GRANTED. The Notice of Coverage
of 22 November 1990 by virtue of which undeveloped portions of the Antipolo
16 Sec. 3 (c), R.A. 6657.
Hills Subdivision were placed under CARL coverage is hereby SET ASIDE.
17 Luz Farms v. Secretary of the Department of Agrarian
SO ORDERED. Reform, G.R. No. 86889, 4 December 1990, 192 SCRA 51,
Citing Record, CONCOM, 7 August 1986, Vol. III, p. 30.
Narvasa, C.J., Cruz, Feliciano, Padilla, Bidin, Grio-Aquino, Regalado, Davide,
Jr., Romero, Nocon, Melo, Quiason, Puno and Vitug, JJ., concur. 18 DAR Administrative Order No. 1, Series of 1990.
19 Opinion No. 181, Series of 1990.
# Footnotes 20 Rocamora v. RTC-Cebu, Br. VIII, G.R. No. 65037, 23
November 1988, 167 SCRA 615.
1 National Housing Authority and Human Settlements
Regulatory Commission; see C.T. Torres v. Hibionada, G.R.
No. 80916, 9 November 1990, 191 SCRA 268.
2 Date of effectivity of R.A. 6657, otherwise known as the
Comprehensive Agrarian Reform Law of 1988.
3 Annex "H", Petition; Rollo, p. 33.
4 Annex "A", Petition; Rollo, p. 26.
5 Annex "C", Petition; Rollo, p. 28.
6 Annex "E", Petition; Rollo, p. 30.
7 Annexes "B", "D" and "F", Petition; Rollo, pp. 27, 29 and
31.
8 Complaint, p. 3; Rollo, p. 68.
9 DARAB Resolution, 16 December 1991, p. 8; Rollo, p. 82.
10 Renamed Housing and Land Use Regulatory Board
(HLURB) per E.O. No. 90, dated 17 December 1986.
11 Annexes "A" and "C", Petition; Rollo, pp. 26 and 28.
12 Annex "B", Petition; Rollo, p. 27.
13 Annexes "D" and "E", petition; Rollo, pp. 29-30.
 pursuant to the then existing agrarian reform program of the government,
respondents made a voluntary offer to sell (VOS) [1] their landholdings to petitioner
DAR to avail of certain incentives under the law.
On June 10, 1988, a new agrarian law, Republic Act (R.A.) No. 6657,
also known as the Comprehensive Agrarian Reform Law (CARL) of 1988, took
effect. It included in its coverage farms used for raising livestock, poultry and
swine.
On December 4, 1990, in an en banc decision in the case of Luz Farms
v. Secretary of DAR,[2] this Court ruled that lands devoted to livestock and poultry-
raising are not included in the definition of agricultural land. Hence, we declared as
unconstitutional certain provisions of the CARL insofar as they included livestock
farms in the coverage of agrarian reform.
In view of the Luz Farms ruling, respondents filed with petitioner DAR
a formal request to withdraw their VOS as their landholding was devoted
exclusively to cattle-raising and thus exempted from the coverage of the CARL. [3]
On December 21, 1992, the Municipal Agrarian Reform Officer of
Aroroy, Masbate, inspected respondents land and found that it was devoted solely to
cattle-raising and breeding. He recommended to the DAR Secretary that it be
exempted from the coverage of the CARL.
EN BANC On April 27, 1993, respondents reiterated to petitioner DAR the
withdrawal of their VOS and requested the return of the supporting papers they
DEPARTMENT OF AGRARIAN G.R. No. 162070 submitted in connection therewith.[4] Petitioner ignored their request.
REFORM, represented by SECRETARY
JOSE MARI B. PONCE (OIC), Present: On December 27, 1993, DAR issued A.O. No. 9, series of 1993,
Petitioner, Davide, C.J., [5]
which provided that only portions of private agricultural lands used for the
Puno, raising of livestock, poultry and swine as of June 15, 1988 shall be excluded from
Panganiban, the coverage of the CARL. In determining the area of land to be excluded, the A.O.
Quisumbing, fixed the following retention limits, viz: 1:1 animal-land ratio (i.e., 1 hectare of land
Ynares-Santiago, per 1 head of animal shall be retained by the landowner), and a ratio of 1.7815
Sandoval-Gutierrez, hectares for livestock infrastructure for every 21 heads of cattle shall likewise be
Carpio, excluded from the operations of the CARL.
- versus - Austria-Martinez,
Corona, On February 4, 1994, respondents wrote the DAR Secretary and advised him to
Carpio Morales, consider as final and irrevocable the withdrawal of their VOS as, under the Luz
Callejo, Sr., Farms doctrine, their entire landholding is exempted from the CARL.[6]
Azcuna,
Tinga, On September 14, 1995, then DAR Secretary Ernesto D. Garilao issued an
Chico-Nazario and Order[7] partially granting the application of respondents for exemption from the
Garcia, JJ. coverage of CARL. Applying the retention limits outlined in the DAR A.O. No. 9,
DELIA T. SUTTON, ELLA T. petitioner exempted1,209 hectares of respondents land for grazing purposes, and a
SUTTON-SOLIMAN and Promulgated: maximum of 102.5635 hectares for infrastructure. Petitioner ordered the rest of
HARRY T. SUTTON, respondents landholding to be segregated and placed under Compulsory
Respondents. October 19, 2005 Acquisition.
x-----------------------------------x
Respondents moved for reconsideration. They contend that their entire
landholding should be exempted as it is devoted exclusively to cattle-raising. Their
DECISION motion was denied.[8] They filed a notice of appeal[9] with the Office of the President
assailing: (1) the reasonableness and validity of DAR A.O. No. 9, s. 1993, which
PUNO, J.: provided for a ratio between land and livestock in determining the land area
qualified for exclusion from the CARL, and (2) the constitutionality of DAR A.O.
This is a petition for review filed by the Department of Agrarian Reform (DAR) of No. 9, s. 1993, in view of the Luz Farms case which declared cattle-raising lands
the Decision and Resolution of the Court of Appeals, dated September 19, 2003 and excluded from the coverage of agrarian reform.
February 4, 2004, respectively, which declared DAR Administrative Order (A.O.)
No. 9, series of 1993, null and void for being violative of the Constitution. On October 9, 2001, the Office of the President affirmed the impugned Order of
petitioner DAR.[10] It ruled that DAR A.O. No. 9, s. 1993, does not run counter to
The case at bar involves a land in Aroroy, Masbate, inherited by respondents which the Luz Farms case as the A.O. provided the guidelines to determine whether a
has been devoted exclusively to cow and calf breeding. On October 26, 1987, certain parcel of land is being used for cattle-raising. However, the issue on the
constitutionality of the assailed A.O. was left for the determination of the
courts as the sole arbiters of such issue.
On appeal, the Court of Appeals 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. The dispositive portion reads:
WHEREFORE, premises considered, DAR Administrative
Order No. 09, Series of 1993 is hereby DECLARED null
and void. The assailed order of the Office of the President
dated 09 October 2001 in so far as it affirmed the Department
of Agrarian Reforms ruling that petitioners landholding is
covered by the agrarian reform program of the government
is REVERSED and SET ASIDE.
SO ORDERED.[11]
Hence, this petition.
The main issue in the case at bar is the constitutionality of DAR A.O. No. 9, series
of 1993, which prescribes a maximum retention limit for owners of lands devoted to
livestock raising.
Invoking its rule-making power under Section 49 of the CARL, petitioner submits
that it issued DAR A.O. No. 9 to limit the area of livestock farm that may be
retained by a landowner pursuant to its mandate to place all public and private
agricultural lands under the coverage of agrarian reform. Petitioner also contends
that the A.O. seeks to remedy reports that some unscrupulous landowners have
converted their agricultural farms to livestock farms in order to evade their
coverage in the agrarian reform program.
Petitioners arguments fail to impress.
Administrative agencies are endowed with powers legislative in
nature, i.e., the power to make rules and regulations. They have been granted by
Congress with the authority to issue rules to regulate the implementation of a law
entrusted to them. Delegated rule-making has become a practical necessity in
modern governance due to the increasing complexity and variety of public
functions. However, while administrative rules and regulations have the force and
effect of law, they are not immune from judicial review.[12]They may be properly
challenged before the courts to ensure that they do not violate the Constitution and
no grave abuse of administrative discretion is committed by the administrative body
concerned.
The fundamental rule in administrative law is that, to be valid, administrative
rules and regulations must be issued by authority of a law and must not
contravene the provisions of the Constitution. [13] The rule-making power of an
administrative agency may not be used to abridge the authority given to it by
Congress or by the Constitution. Nor can it be used to enlarge the power of the
administrative agency beyond the scope intended. Constitutional and statutory
provisions control with respect to what rules and regulations may be
promulgated by administrative agencies and the scope of their regulations.[14]
In the case at bar, we find that the impugned A.O. is invalid as it
contravenes the Constitution. The A.O. sought to regulate livestock farms by
including them in the coverage of agrarian reform and prescribing a maximum
retention limit for their ownership. However, the deliberations of the 1987
Constitutional Commission show a clear intent to exclude, inter alia, all lands
exclusively devoted to livestock, swine and poultry- raising. The Court clarified
in the Luz Farms case that livestock, swine and poultry-raising are industrial
activities and do not fall within the definition of agriculture or agricultural activity.
The raising of livestock, swine and poultry is different from crop or tree farming. It
is an industrial, not an agricultural, activity. A great portion of the investment in this
enterprise is in the form of industrial fixed assets, such as: animal housing
 [4]
structures and facilities, drainage, waterers and blowers, feedmill with grinders, IN VIEW WHEREOF, the petition is DISMISSED. The assailed Id., pp. 67-68.
mixers, conveyors, exhausts and generators, extensive warehousing facilities for Decision and Resolution of the Court of Appeals, dated September 19, 2003 and
[5]
feeds and other supplies, anti-pollution equipment like bio-gas and digester plants February 4, 2004, respectively, are AFFIRMED. No pronouncement as to costs. Id., pp. 57-62.
augmented by lagoons and concrete ponds, deepwells, elevated water tanks,
pumphouses, sprayers, and other technological appurtenances. [15] SO ORDERED. [6]
Id., pp. 69-71.
[7]
Clearly, petitioner DAR has no power to regulate livestock farms REYNATO S. PUNO Id., pp. 72-76.
which have been exempted by the Constitution from the coverage of agrarian Associate Justice
[8]
reform. It has exceeded its power in issuing the assailed A.O. Order, dated October 5, 1995; CA Rollo, pp. 87-89.
WE CONCUR:
The subsequent case of Natalia Realty, Inc. v. DAR [16] reiterated our [9]
O.P. Case No. 96-A-6361.
ruling in the Luz Farms case. In Natalia Realty, the Court held that industrial, HILARIO G. DAVIDE, JR.
commercial and residential lands are not covered by the CARL. [17] We stressed Chief Justice [10]
CA Rollo, pp. 50-54.
anew that while Section 4 of R.A. No. 6657 provides that the CARL shall cover
[11]
all public and private agricultural lands, the term agricultural land does not ARTEMIO V. PANGANIBAN LEONARDO A. QUISUMBING CA Decision dated September 19, 2003, penned by Associate Justice
include lands classified as mineral, forest, residential, commercial or Associate Justice Associate Justice Buenaventura J. Guerrero and concurred in by Associate Justices Andres
industrial. Thus, in Natalia Realty, even portions of the Antipolo Hills B. Reyes, Jr. and Regalado E. Maambong; Rollo, pp. 32-43.
[12]
Subdivision, which are arable yet still undeveloped, could not be considered as Administrative Law and Process in a Nutshell, Gellhorn and Levin, 1990 ed., p.
agricultural lands subject to agrarian reform as these lots were already classified as 315.
residential lands.
[13]
Pagpalain Haulers, Inc. v. Trajano, 310 SCRA 354 (1999).
A similar logical deduction should be followed in the case at bar. Lands devoted to CONSUELO YNARES-SANTIAGO ANGELINA SANDOVAL-GUTIERREZ
[14]
raising of livestock, poultry and swine have been classified as industrial, not Associate Justice Associate Justice Conte v. Commission on Audit, 264 SCRA 19 (1996).
agricultural, lands and thus exempt from agrarian reform. Petitioner DAR argues
[15]
that, in issuing the impugned A.O., it was seeking to address the reports it has ANTONIO T. CARPIO MA. ALICIA AUSTRIA-MARTINEZ Luz Farms case, supra, p. 61.
received that some unscrupulous landowners have been converting their agricultural Associate Justice Associate Justice
[16]
lands to livestock farms to avoid their coverage by the agrarian reform. Again, we 225 SCRA 278 (1993).
find neither merit nor logic in this contention. The undesirable scenario which RENATO C. CORONA CONCHITA CARPIO MORALES
[17]
petitioner seeks to prevent with the issuance of the A.O. clearly does not apply Associate Justice Associate Justice This same ruling was adapted on February 21, 1995 by then Executive Secretary
in this case. Respondents family acquired their landholdings as early as 1948. They Teofisto Guingona, Jr., by authority of the President, in his Decision
have long been in the business of breeding cattle in Masbate which is popularly ROMEO J. CALLEJO, SR. ADOLFO S. AZCUNA exempting from the coverage of agrarian reform the landholdings of
known as the cattle-breeding capital of the Philippines. [18] Petitioner DAR does not Associate Justice Associate Justice Golden Country Farms, Inc., used in its cattle, swine and poultry
dispute this fact. Indeed, there is no evidence on record that respondents have just operations. See O.P. Case No. 5454, CA Rollo, pp. 103-111.
[18]
recently engaged in or converted to the business of breeding cattle after the DANTE O. TINGA MINITA V. CHICO-NAZARIO Opposition to Respondents Motion for Reconsideration, pp. 310-311.
enactment of the CARL that may lead one to suspect that respondents intended to Associate Justice Associate Justice
[19]
evade its coverage. It must be stressed that what the CARL prohibits is Administrative Law, A Text, Reginald Parker, p. 157.
the conversion of agricultural lands for non-agricultural purposes after the
[20]
effectivity of the CARL. There has been no change of business interest in the CANCIO C. GARCIA Enacted on July 25, 1994.
case of respondents. Associate Justice
[21]
Sections 1 and 3 of R.A. No. 7881.
Moreover, it is a fundamental rule of statutory construction that the CERTIFICATION
[22]
reenactment of a statute by Congress without substantial change is an implied Conte v. Commission on Audit, supra.
legislative approval and adoption of the previous law. On the other hand, by making Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the
a new law, Congress seeks to supersede an earlier one. [19] In the case at bar, after the conclusions in the above Decision were reached in consultation before the case was
passage of the 1988 CARL, Congress enacted R.A. No. 7881 [20] which amended assigned to the writer of the opinion of the Court.
certain provisions of the CARL. Specifically, the new law changed the definition
of the terms agricultural activity and commercial farming by dropping from HILARIO G. DAVIDE, JR.
its coverage lands that are devoted to commercial livestock, poultry and swine- Chief Justice
raising.[21] With this significant modification, Congress clearly sought to align
[1]
the provisions of our agrarian laws with the intent of the 1987 Constitutional This is a transaction entered into by the landowner and the government, thru the
Commission to exclude livestock farms from the coverage of agrarian reform. DAR, the purchase price of the land being the one agreed upon between
them, and paid by the Land Bank of the Philippines. Under E.O. No.
In sum, it is doctrinal that rules of administrative bodies must be in 229, such transactions shall be exempt from the payment of the capital
harmony with the provisions of the Constitution. They cannot amend or extend the gains tax and other taxes and fees. As an additional incentive, Section 19
Constitution. To be valid, they must conform to and be consistent with the of the CARP gives to landowners who voluntarily offer to sell their land
Constitution. In case of conflict between an administrative order and the provisions an additional five percent (5%) cash payment.
of the Constitution, the latter prevails.[22] The assailed A.O. of petitioner DAR was
[2]
properly stricken down as unconstitutional as it enlarges the coverage of agrarian 192 SCRA 51 (1990).
reform beyond the scope intended by the 1987 Constitution.
[3]
CA Rollo, pp. 65-66.
 Manila
SECOND DIVISION
x-----------------------------------------------------------------------------x
DECISION
NACHURA, J.:
Before this Court is a Petition for Review on Certiorari[1] under Rule 45
of the Rules of Civil Procedure, seeking the reversal of the Court of Appeals (CA)
Amended Decision[2] dated October 4, 2006 and its Resolution [3] dated March 27,
2008.
Republic of the Philippines
The Facts
Supreme Court
Petitioner Milestone Farms, Inc. (petitioner) was incorporated with the
MILESTONE FARMS, INC., Securities and Exchange Commission on January 8, 1960.[4] Among its pertinent
G.R. No. 182332 secondary purposes are: (1) to engage in the raising of cattle, pigs, and other
Petitioner, livestock; to acquire lands by purchase or lease, which may be needed for this
purpose; and to sell and otherwise dispose of said cattle, pigs, and other livestock
and their produce when advisable and beneficial to the corporation; (2) to breed,
raise, and sell poultry; to purchase or acquire and sell, or otherwise dispose of the
supplies, stocks, equipment, accessories, appurtenances, products, and by-products
Present:
of said business; and (3) to import cattle, pigs, and other livestock, and animal food
necessary for the raising of said cattle, pigs, and other livestock as may be
authorized by law.[5]
CARPIO, J.,
On June 10, 1988, a new agrarian reform law, Republic Act (R.A.) No.
- versus - 6657, otherwise known as the Comprehensive Agrarian Reform Law (CARL), took
Chairperson, effect, which included the raising of livestock, poultry, and swine in its coverage.
However, on December 4, 1990, this Court, sitting en banc, ruled in Luz Farms v.
NACHURA, Secretary of the Department of Agrarian Reform [6] that agricultural lands devoted to
livestock, poultry, and/or swine raising are excluded from the Comprehensive
PERALTA, Agrarian Reform Program (CARP).
ABAD, and Thus, in May 1993, petitioner applied for the exemption/exclusion of its 316.0422-
hectare property, covered by Transfer Certificate of Title Nos. (T-410434) M-15750,
VILLARAMA, JR.,* JJ. (T-486101) M-7307, (T-486102) M-7308, (T-274129) M-15751, (T-486103) M-
7309, (T-486104) M-7310, (T-332694) M-15755, (T-486105) M-7311, (T-486106)
M-7312, M-8791, (T-486107) M-7313, (T-486108) M-7314, M-8796, (T-486109)
M-7315, (T-486110) M-9508, and M-6013, and located in Pinugay, Baras, Rizal,
OFFICE OF THE PRESIDENT,
Promulgated: from the coverage of the CARL, pursuant to the aforementioned ruling of this Court
in Luz Farms.
Respondent.
February 23, 2011
Meanwhile, on December 27, 1993, the Department of Agrarian Reform
(DAR) issued Administrative Order No. 9, Series of 1993 (DAR A.O. No. 9),
setting forth rules and regulations to govern the exclusion of agricultural lands used
for livestock, poultry, and swine raising from CARP coverage. Thus, on January 10,
1994, petitioner re-documented its application pursuant to DAR A.O. No. 9.[7]
Acting on the said application, the DARs Land Use Conversion and Exemp
Committee (LUCEC) of Region IV conducted an ocular inspection on petitioners property
arrived at the following findings:
[T]he actual land utilization for livestock, swine and poultry
is 258.8422 hectares; the area which served as infrastructure
is 42.0000 hectares; ten (10) hectares are planted to corn and
the remaining five (5) hectares are devoted to fish culture;
that the livestock population are 371 heads of cow, 20 heads
of horses, 5,678 heads of swine and 788 heads of cocks; that
the area being applied for exclusion is far below the required
or ideal area which is 563 hectares for the total livestock
population; that the approximate area not directly used for
livestock purposes with an area of 15 hectares, more or less,
is likewise far below the allowable 10% variance; and,
though not directly used for livestock purposes, the ten (10)
hectares planted to sweet corn and the five (5) hectares
devoted to fishpond could be considered supportive to
livestock production.
The LUCEC, thus, recommended the exemption of petitioners 316.0422-
hectare property from the coverage of CARP. Adopting the LUCECs findings and
recommendation, DAR Regional Director Percival Dalugdug (Director Dalugdug)
issued an Order dated June 27, 1994, exempting petitioners 316.0422-hectare
property from CARP.[8]
The Southern Pinugay Farmers Multi-Purpose Cooperative, Inc.
(Pinugay Farmers), represented by Timiano Balajadia, Sr. (Balajadia), moved for
the reconsideration of the said Order, but the same was denied by Director
Dalugdug in his Order dated November 24, 1994. [9] Subsequently, the Pinugay
Farmers filed a letter-appeal with the DAR Secretary.
Correlatively, on June 4, 1994, petitioner filed a complaint for Forcible
Entry against Balajadia and company before the Municipal Circuit Trial Court
(MCTC) of Teresa-Baras, Rizal, docketed as Civil Case No. 781-T. [10] The MCTC
ruled in favor of petitioner, but the decision was later reversed by the Regional Trial
Court, Branch 80, of Tanay, Rizal. Ultimately, the case reached the CA, which, in its
Decision[11] dated October 8, 1999, reinstated the MCTCs ruling, ordering Balajadia
and all defendants therein to vacate portions of the property covered by TCT Nos.
M-6013, M-8796, and M-8791. In its Resolution[12] dated July 31, 2000, the CA
held that the defendants therein failed to timely file a motion for reconsideration,
given the fact that their counsel of record received its October 8, 1999 Decision;
hence, the same became final and executory.
In the meantime, R.A. No. 6657 was amended by R.A. No. 7881,
[13]
which was approved on February 20, 1995. Private agricultural lands devoted to
livestock, poultry, and swine raising were excluded from the coverage of the
CARL. On October 22, 1996, the fact-finding team formed by the DAR
Undersecretary for Field Operations and Support Services conducted an actual
headcount of the livestock population on the property. The headcount showed that
there were 448 heads of cattle and more than 5,000 heads of swine.

The DAR Secretarys Ruling
On January 21, 1997, then DAR Secretary Ernesto D. Garilao (Secretary
Garilao) issued an Order exempting from CARP only 240.9776 hectares of the
316.0422 hectares previously exempted by Director Dalugdug, and declaring
75.0646 hectares of the property to be covered by CARP.[14]
Secretary Garilao opined that, for private agricultural lands to be
excluded from CARP, they must already be devoted to livestock, poultry, and swine
raising as of June 15, 1988, when the CARL took effect. He found that the
Certificates of Ownership of Large Cattle submitted by petitioner showed that only
86 heads of cattle were registered in the name of petitioners president, Misael Vera,
Jr., prior to June 15, 1988; 133 were subsequently bought in 1990, while 204 were
registered from 1992 to 1995.Secretary Garilao gave more weight to the certificates
rather than to the headcount because the same explicitly provide for the number of
cattle owned by petitioner as of June 15, 1988.
Applying the animal-land ratio (1 hectare for grazing for every head of
cattle/carabao/horse) and the infrastructure-animal ratio (1.7815 hectares for 21
heads of cattle/carabao/horse, and 0.5126 hectare for 21 heads of hogs) under DAR
A.O. No. 9, Secretary Garilao exempted 240.9776 hectares of the property, as
follows:
1. 86 hectares for the 86 heads of cattle existing
as of 15 June 1988;
2. 8 hectares for infrastructure following the ratio
of 1.7815 hectares for every 21 heads of cattle;
3. 8 hectares for the 8 horses;
4. 0.3809 square meters of infrastructure for
the 8 horses; [and]
5. 138.5967 hectares for the 5,678 heads of
swine.[15]
Petitioner filed a Motion for Reconsideration, [16] submitting therewith
copies of Certificates of Transfer of Large Cattle and additional Certificates of
Ownership of Large Cattle issued to petitioner prior to June 15, 1988, as additional
proof that it had met the required animal-land ratio. Petitioner also submitted a copy
of a Disbursement Voucher dated December 17, 1986, showing the purchase of 100
heads of cattle by the Bureau of Animal Industry from petitioner, as further proof
that it had been actively operating a livestock farm even before June 15,
1988. However, in his Order dated April 15, 1997, Secretary Garilao denied
petitioners Motion for Reconsideration.[17]
Aggrieved, petitioner filed its Memorandum on Appeal [18]
before the
Office of the President (OP).
The OPs Ruling
On February 4, 2000, the OP rendered a decision [19] reinstating Director
Dalugdugs Order dated June 27, 1994 and declared the entire 316.0422-hectare
property exempt from the coverage of CARP.
However, on separate motions for reconsideration of the aforesaid
decision filed by farmer-groups Samahang Anak-Pawis ng Lagundi (SAPLAG) and
Pinugay Farmers, and the Bureau of Agrarian Legal Assistance of DAR, the OP
issued a resolution[20]dated September 16, 2002, setting aside its previous decision.
The dispositive portion of the OP resolution reads:
WHEREFORE, the Decision subject of the instant
separate motions for reconsideration is hereby SET ASIDE
and a new one entered REINSTATING the Order dated 21
January 1997 of then DAR Secretary Ernesto D. Garilao, as
reiterated in another Order of 15 April 1997, without
prejudice to the outcome of the continuing review and
verification proceedings that DAR, thru the appropriate
Municipal Agrarian Reform Officer, may undertake pursuant
to Rule III (D) of DAR Administrative Order No. 09, series
of 1993.
SO ORDERED.[21]
The OP held that, when it comes to proof of ownership, the reference is
the Certificate of Ownership of Large Cattle. Certificates of cattle ownership, which
are readily available being issued by the appropriate government office ought to
match the number of heads of cattle counted as existing during the actual
headcount. The presence of large cattle on the land, without sufficient proof of
ownership thereof, only proves such presence.
Taking note of Secretary Garilaos observations, the OP also held that, before an(Palo Alto).
investigation is conducted on the property, the landowners are notified in advance; hence, mere
reliance on the physical headcount is dangerous because there is a possibility that the landowners Subsequently, in a Supplement to the Motion for Reconsideration on
would increase the number of their cattle for headcount purposes only. The OP observed that Newly
was a big variance between the actual headcount of 448 heads of cattle and only 86 certificates
ownership of large cattle.
Consequently, petitioner sought recourse from the CA.[22]
The Proceedings Before the CA and Its Rulings
On April 29, 2005, the CA found that, based on the
documentary evidence presented, the property subject of the application
for exclusion had more than satisfied the animal-land and infrastructure-
animal ratios under DAR A.O. No. 9. The CA also found that petitioner
applied for exclusion long before the effectivity of DAR A.O. No. 9,
thus, negating the claim that petitioner merely converted the property
for livestock, poultry, and swine raising in order to exclude it from
CARP coverage. Petitioner was held to have actually engaged in the
said business on the property even before June 15, 1988. The CA
disposed of the case in this wise:
WHEREFORE, the instant petition is
hereby GRANTED. The assailed Resolution of the Office of
the President dated September 16, 2002 is hereby SET
ASIDE, and its Decision dated February 4, 2000 declaring
the entire 316.0422 hectares exempt from the coverage of the
Comprehensive Agrarian Reform Program is
hereby REINSTATED without prejudice to the outcome of
the continuing review and verification proceedings which the
Department of Agrarian Reform, through the proper
Municipal Agrarian Reform Officer, may undertake pursuant
to Policy Statement (D) of DAR Administrative Order No. 9,
Series of 1993.
SO ORDERED.[23]
Meanwhile, six months earlier, or on November 4, 2004, without the
knowledge of the CA as the parties did not inform the appellate court then DAR
Secretary Rene C. Villa (Secretary Villa) issued DAR Conversion Order No. CON-
0410-0016[24](Conversion Order), granting petitioners application to convert
portions of the 316.0422-hectare property from agricultural to residential and golf
courses use. The portions converted with a total area of 153.3049 hectares were
covered by TCT Nos. M-15755 (T-332694), M-15751 (T-274129), and M-15750 (T-
410434). With this Conversion Order, the area of the property subject of the
controversy was effectively reduced to 162.7373 hectares.
On the CAs decision of April 29, 2005, Motions for Reconsideration
were filed by farmer-groups, namely: the farmers represented by Miguel
Espinas[25] (Espinas group), the Pinugay Farmers, [26] and the SAPLAG.[27] The
farmer-groups all claimed that the CA should have accorded respect to the factual
findings of the OP. Moreover, the farmer-groups unanimously intimated that
petitioner already converted and developed a portion of the property into a leisure-
residential-commercial estate known as the Palo Alto Leisure and Sports Complex
ocular
thereSecured Evidence pursuant to DAR Administrative Order No. 9, Series of
1993[28]
of (Supplement) dated June 15, 2005, the Espinas group submitted the
following as evidence:
1) Conversion Order[29] dated November 4, 2004, issued by Secretary
Villa, converting portions of the property from agricultural to residential and golf
courses use, with a total area of 153.3049 hectares; thus, the Espinas group prayed
that the remaining 162.7373 hectares (subject property) be covered by the CARP;
2) Letter[30] dated June 7, 2005 of both incoming Municipal Agrarian
Reform Officer (MARO) Bismark M. Elma (MARO Elma) and outgoing MARO
Cesar C. Celi (MARO Celi) of Baras, Rizal, addressed to Provincial Agrarian
Reform Officer (PARO) II of Rizal, Felixberto Q. Kagahastian, (MARO Report),
informing the latter, among others, that Palo Alto was already under development
and the lots therein were being offered for sale; that there were actual tillers on the
subject property; that there were agricultural improvements thereon, including an
irrigation system and road projects funded by the Government; that there was no
existing livestock farm on the subject property; and that the same was not in the
possession and/or control of petitioner; and
3) Certification[31] dated June 8, 2005, issued by both MARO Elma and
MARO Celi, manifesting that the subject property was in the possession and
cultivation of actual occupants and tillers, and that, upon inspection, petitioner
maintained no livestock farm thereon.
Four months later, the Espinas group and the DAR filed their respective
Manifestations.[32] In its Manifestation dated November 29, 2005, the DAR
confirmed that the subject property was no longer devoted to cattle raising. Hence,
in its Resolution[33] dated December 21, 2005, the CA directed petitioner to file its
comment on the Supplement and the aforementioned Manifestations. Employing
the services of a new counsel, petitioner filed a Motion to Admit Rejoinder, [34] and
prayed that the MARO Report be disregarded and expunged from the records for
lack of factual and legal basis.
With the CA now made aware of these developments, particularly
Secretary Villas Conversion Order of November 4, 2004, the appellate court had to
acknowledge that the property subject of the controversy would now be limited to
the remaining 162.7373 hectares. In the same token, the Espinas group prayed that
this remaining area be covered by the CARP.[35]
On October 4, 2006, the CA amended its earlier Decision. It held that its
April 29, 2005 Decision was theoretically not final because DAR A.O. No. 9
required the MARO to make a continuing review and verification of the subject
property. While the CA was cognizant of our ruling in Department of Agrarian
Reform v. Sutton,[36] wherein we declared DAR A.O. No. 9 as unconstitutional, it
still resolved to lift the exemption of the subject property from the CARP, not on the
basis of DAR A.O. No. 9, but on the strength of evidence such as the MARO
Report and Certification, and the Katunayan[37] issued by the Punong Barangay,
Alfredo Ruba (Chairman Ruba), of Pinugay, Baras, Rizal, showing that the subject
property was no longer operated as a livestock farm. Moreover, the CA held that the
lease agreements,[38] which petitioner submitted to prove that it was compelled to
lease a ranch as temporary shelter for its cattle, only reinforced the DARs finding
that there was indeed no existing livestock farm on the subject property. While
petitioner claimed that it was merely forced to do so to prevent further slaughtering
of its cattle allegedly committed by the occupants, the CA found the claim
unsubstantiated. Furthermore, the CA opined that petitioner should have asserted its
rights when the irrigation and road projects were introduced by the Government
within its property. Finally, the CA accorded the findings of MARO Elma and
MARO Celi the presumption of regularity in the performance of official functions
in the absence of evidence proving misconduct and/or dishonesty when they
inspected the subject property and rendered their report. Thus, the CA disposed:
WHEREFORE, this Courts Decision dated April
29, 2005 is hereby amended in that the exemption of the
subject landholding from the coverage of the Comprehensive
Agrarian Reform Program is hereby lifted, and the 162.7373
hectare-agricultural portion thereof is hereby declared
covered by the Comprehensive Agrarian Reform Program.
SO ORDERED.[39]
Unperturbed, petitioner filed a Motion for Reconsideration.[40] On
January 8, 2007, MARO Elma, in compliance with the Memorandum of DAR
Regional Director Dominador B. Andres, tendered another Report [41] reiterating that,
upon inspection of the subject property, together with petitioners counsel-turned
witness, Atty. Grace Eloisa J. Que (Atty. Que), PARO Danilo M. Obarse, Chairman
Ruba, and several occupants thereof, he, among others, found no livestock farm
within the subject property. About 43 heads of cattle were shown, but MARO Elma
observed that the same were inside an area adjacent to Palo Alto. Subsequently,
upon Atty. Ques request for reinvestigation, designated personnel of the DAR
Provincial and Regional Offices (Investigating Team) conducted another ocular
inspection on the subject property on February 20, 2007. The Investigating Team, in
its Report[42] dated February 21, 2007, found that, per testimony of petitioners
caretaker, Rogelio Ludivices (Roger), [43] petitioner has 43 heads of cattle taken care
of by the following individuals: i) Josefino Custodio (Josefino) 18 heads; ii) Andy
Amahit 15 heads; and iii) Bert Pangan 2 heads; that these individuals pastured the
herd of cattle outside the subject property, while Roger took care of 8 heads of
cattle inside the Palo Alto area; that 21 heads of cattle owned by petitioner were
seen in the area adjacent to Palo Alto; that Josefino confirmed to the Investigating
Team that he takes care of 18 heads of cattle owned by petitioner; that the said
Investigating Team saw 9 heads of cattle in the Palo Alto area, 2 of which bore MFI
marks; and that the 9 heads of cattle appear to have matched the Certificates of
Ownership of Large Cattle submitted by petitioner.
Because of the contentious factual issues and the conflicting averments
of the parties, the CA set the case for hearing and reception of evidence on April 24,
2007.[44] Thereafter, as narrated by the CA, the following events transpired:
On May 17, 2007, [petitioner] presented
the Judicial Affidavits of its witnesses, namely, [petitioners]
counsel, [Atty. Que], and the alleged caretaker of
[petitioners] farm, [Roger], who were both cross-examined
by counsel for farmers-movants and SAPLAG. [Petitioner]
and SAPLAG then marked their documentary exhibits.
On May 24, 2007, [petitioners] security guard and third
witness, Rodolfo G. Febrada, submitted his Judicial
Affidavit and was cross-examined by counsel for fa[r]mers-
movants and SAPLAG. Farmers-movants also marked their
documentary exhibits.
Thereafter, the parties submitted their respective Formal
Offers of Evidence. Farmers-movants and SAPLAG filed
their objections to [petitioners] Formal Offer of
Evidence. Later, [petitioner] and farmers-movants filed their
respective Memoranda.
In December 2007, this Court issued a Resolution on the
parties offer of evidence and considered [petitioners] Motion
for Reconsideration submitted for resolution.[45]
Finally, petitioners motion for reconsideration was denied by the CA in
its Resolution[46] dated March 27, 2008. The CA discarded petitioners reliance
on Sutton. It ratiocinated that the MARO Reports and the DARs Manifestation
could not be disregarded simply because DAR A.O. No. 9 was declared
unconstitutional. The Sutton ruling was premised on the fact that
the Sutton property continued to operate as a livestock farm. The CA also reasoned
that, in Sutton, this Court did not remove from the DAR the power to implement the
CARP, pursuant to the latters authority to oversee the implementation of agrarian
reform laws under Section 50[47] of the CARL. Moreover, the CA found:
Petitioner-appellant claimed that they had 43
heads of cattle which are being cared for and pastured by 4
individuals. To prove its ownership of the said cattle,
petitioner-appellant offered in evidence 43 Certificates of
Ownership of Large Cattle. Significantly, however, the
said Certificates were all dated and issued on November 24,
2006, nearly 2 months after this Court rendered its Amended
Decisionlifting the exemption of the 162-hectare portion of
the subject landholding. The acquisition of such cattle after
the lifting of the exemption clearly reveals that petitioner-
appellant was no longer operating a livestock farm, and
suggests an effort to create a semblance of livestock-raising
for the purpose of its Motion for Reconsideration.[48]
On petitioners assertion that between MARO Elmas Report dated
January 8, 2007 and the Investigating Teams Report, the latter should be given
credence, the CA held that there were no material inconsistencies between the two
reports because both showed that the 43 heads of cattle were found outside the
subject property.
Hence, this Petition assigning the following errors:
I.
THE HONORABLE COURT OF APPEALS GRAVELY
ERRED WHEN IT HELD THAT LANDS DEVOTED TO
LIVESTOCK FARMING WITHIN THE MEANING
OF LUZ FARMS AND SUTTON, AND WHICH ARE
THEREBY EXEMPT FROM CARL COVERAGE, ARE
NEVERTHELESS SUBJECT TO DARS CONTINUING
VERIFICATION AS TO USE, AND, ON THE BASIS OF
SUCH VERIFICATION, MAY BE ORDERED REVERTED
TO AGRICULTURAL CLASSIFICATION AND
COMPULSORY ACQUISITION[;]
II.
GRANTING THAT THE EXEMPT LANDS AFORESAID
MAY BE SO REVERTED TO AGRICULTURAL
CLASSIFICATION, STILL THE PROCEEDINGS FOR
SUCH PURPOSE BELONGS TO THE EXCLUSIVE
ORIGINAL JURISDICTION OF THE DAR, BEFORE
WHICH THE CONTENDING PARTIES MAY VENTILATE
FACTUAL ISSUES, AND AVAIL THEMSELVES OF
USUAL REVIEW PROCESSES, AND NOT TO THE
COURT OF APPEALS EXERCISING APPELLATE
JURISDICTION OVER ISSUES COMPLETELY
UNRELATED TO REVERSION [; AND]
III.
IN ANY CASE, THE COURT OF APPEALS GRAVELY
ERRED AND COMMITTED GRAVE ABUSE OF
DISCRETION WHEN IT HELD THAT THE PROPERTY
IN DISPUTE IS NO LONGER BEING USED FOR
LIVESTOCK FARMING.[49]
Petitioner asseverates that lands devoted to livestock farming as of June
15, 1988 are classified as industrial lands, hence, outside the ambit of the CARP;
that Luz Farms, Sutton, and R.A. No. 7881 clearly excluded such lands on
constitutional grounds; that petitioners lands were actually devoted to livestock
even before the enactment of the CARL; that livestock farms are exempt from the
CARL, not by reason of any act of the DAR, but because of their nature as
industrial lands; that petitioners property was admittedly devoted to livestock
farming as of June 1988 and the only issue before was whether or not petitioners
pieces of evidence comply with the ratios provided under DAR A.O. No. 9; and that
DAR A.O. No. 9 having been declared as unconstitutional, DAR had no more legal
basis to conduct a continuing review and verification proceedings over livestock
farms. Petitioner argues that, in cases where reversion of properties to agricultural
use is proper, only the DAR has the exclusive original jurisdiction to hear and
decide the same; hence, the CA, in this case, committed serious errors when it
ordered the reversion of the property and when it considered pieces of evidence not
existing as of June 15, 1988, despite its lack of jurisdiction; that the CA should have
remanded the case to the DAR due to conflicting factual claims; that the CA cannot
ventilate allegations of fact that were introduced for the first time on appeal as a
supplement to a motion for reconsideration of its first decision, use the same to
deviate from the issues pending review, and, on the basis thereof, declare exempt
lands reverted to agricultural use and compulsorily covered by the CARP; that the
newly discovered [pieces of] evidence were not introduced in the proceedings
before the DAR, hence, it was erroneous for the CA to consider them; and that
piecemeal presentation of evidence is not in accord with orderly justice. Finally,
petitioner submits that, in any case, the CA gravely erred and committed grave
abuse of discretion when it held that the subject property was no longer used for
livestock farming as shown by the Report of the Investigating Team. Petitioner
relies on the 1997 LUCEC and DAR findings that the subject property was devoted
to livestock farming, and on the 1999 CA Decision which held that the occupants of
the property were squatters, bereft of any authority to stay and possess the property.
[50]
On one hand, the farmer-groups, represented by the Espinas group,
contend that they have been planting rice and fruit-bearing trees on the subject
property, and helped the National Irrigation Administration in setting up an
irrigation system therein in 1997, with a produce of 1,500 to 1,600 sacks
of palay each year; that petitioner came to court with unclean hands because, while
it sought the exemption and exclusion of the entire property, unknown to the CA,
petitioner surreptitiously filed for conversion of the property now known as Palo
Alto, which was actually granted by the DAR Secretary; that petitioners bad faith is
more apparent since, despite the conversion of the 153.3049-hectare portion of the
property, it still seeks to exempt the entire property in this case; and that the fact
that petitioner applied for conversion is an admission that indeed the property is
agricultural. The farmer-groups also contend that petitioners reliance on Luz
Farms and Sutton is unavailing because in these cases there was actually no
cessation of the business of raising cattle; that what is being exempted is the activity
of raising cattle and not the property itself; that exemptions due to cattle raising are
not permanent; that the declaration of DAR A.O. No. 9 as unconstitutional does not
at all diminish the mandated duty of the DAR, as the lead agency of the
Government, to implement the CARL; that the DAR, vested with the power to
identify lands subject to CARP, logically also has the power to identify lands which
are excluded and/or exempted therefrom; that to disregard DARs authority on the
matter would open the floodgates to abuse and fraud by unscrupulous landowners;
that the factual finding of the CA that the subject property is no longer a livestock
farm may not be disturbed on appeal, as enunciated by this Court; that DAR
conducted a review and monitoring of the subject property by virtue of its powers
under the CARL; and that the CA has sufficient discretion to admit evidence in
order that it could arrive at a fair, just, and equitable ruling in this case.[51]
On the other hand, respondent OP, through the Office of the Solicitor
General (OSG), claims that 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; that the issues presented by petitioner are factual in nature and not proper in
this case; that under Rule 43 of the 1997 Rules of Civil Procedure, questions of fact
may be raised by the parties and resolved by the CA; that due to the divergence in
the factual findings of the DAR and the OP, the CA was duty bound to review and
ascertain which of the said findings are duly supported by substantial evidence; that
the subject property was subject to continuing review and verification proceedings
due to the then prevailing DAR A.O. No. 9; that there is no question that the power
to determine if a property is subject to CARP coverage lies with the DAR Secretary;
that pursuant to such power, the MARO rendered the assailed reports and
certification, and the DAR itself manifested before the CA that the subject property
is no longer devoted to livestock farming; and that, while it is true that this Courts
ruling in Luz Farms declared that agricultural lands devoted to livestock, poultry,
and/or swine raising are excluded from the CARP, the said ruling is not without any
qualification.[52]
In its Reply[53] to the farmer-groups and to the OSGs comment, petitioner
counters that the farmer-groups have no legal basis to their claims as they admitted
that they entered the subject property without the consent of petitioner; that the rice
plots actually found in the subject property, which were subsequently taken over by
squatters, were, in fact, planted by petitioner in compliance with the directive of
then President Ferdinand Marcos for the employer to provide rice to its employees;
that when a land is declared exempt from the CARP on the ground that it is not
agricultural as of the time the CARL took effect, the use and disposition of that land
is entirely and forever beyond DARs jurisdiction; and that, inasmuch as the subject
property was not agricultural from the very beginning, DAR has no power to
regulate the same. Petitioner also asserts that the CA cannot uncharacteristically
assume the role of trier of facts and resolve factual questions not previously
adjudicated by the lower tribunals; that MARO Elma rendered the assailed MARO
reports with bias against petitioner, and the same were contradicted by the
Investigating Teams Report, which confirmed that the subject property is still
devoted to livestock farming; and that there has been no change in petitioners
business interest as an entity engaged in livestock farming since its inception in
1960, though there was admittedly a decline in the scale of its operations due to the
illegal acts of the squatter-occupants.
Our Ruling
The Petition is bereft of merit.
Let it be stressed that when the CA provided in its first Decision that
continuing review and verification may be conducted by the DAR pursuant to DAR
A.O. No. 9, the latter was not yet declared unconstitutional by this Court. The first
CA Decision was promulgated on April 29, 2005, while this Court struck down as
unconstitutional DAR A.O. No. 9, by way of Sutton, on October 19, 2005.
Likewise, let it be emphasized that the Espinas group filed the Supplement and
submitted the assailed MARO reports and certification on June 15, 2005, which
proved to be adverse to petitioners case. 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.
While it is true that an issue which was neither alleged in the complaint
nor raised during the trial cannot be raised for the first time on appeal as it would be
offensive to the basic rules of fair play, justice, and due process, [54] the same is not
without exception,[55] such as this case. The CA, under Section 3,[56] Rule 43 of the
Rules of Civil Procedure, can, in the interest of justice, entertain and resolve factual
issues. After all, technical and procedural rules are intended to help secure, and not
suppress, substantial justice. A deviation from a rigid enforcement of the rules may
thus be allowed to attain the prime objective of dispensing justice, for dispensation
of justice is the core reason for the existence of courts. [57] Moreover, petitioner
cannot validly claim that it was deprived of due process because the CA afforded it
all the opportunity to be heard.[58] The CA even directed petitioner to file its
comment on the Supplement, and to prove and establish its claim that the subject
property was excluded from the coverage of the CARP. Petitioner actively
participated in the proceedings before the CA by submitting pleadings and pieces of
documentary evidence, such as the Investigating Teams Report and judicial
affidavits. The CA also went further by setting the case for hearing. In all these
proceedings, all the parties rights to due process were amply protected and
recognized.
With the procedural issue disposed of, we find that petitioners arguments
fail to persuade. Its invocation of Sutton is unavailing. In Sutton, we held:
In the case at bar, we find that the impugned A.O. is invalid
as it contravenes the Constitution. The A.O. sought to
regulate livestock farms by including them in the coverage of
agrarian reform and prescribing a maximum retention limit
for their ownership. However, the deliberations of the 1987
Constitutional Commission show a clear intent to exclude,
inter alia, all lands exclusively devoted to livestock, swine
and poultry-raising. The Court clarified in the Luz
Farms case that livestock, swine and poultry-raising are
industrial activities and do not fall within the definition of
agriculture or agricultural activity. The raising of livestock,
swine and poultry is different from crop or tree farming. It is
an industrial, not an agricultural, activity. A great portion of
the investment in this enterprise is in the form of industrial
fixed assets, such as: animal housing structures and facilities,
drainage, waterers and blowers, feedmill with grinders,
mixers, conveyors, exhausts and generators, extensive
warehousing facilities for feeds and other supplies, anti-
pollution equipment like bio-gas and digester plants
augmented by lagoons and concrete ponds, deepwells,
elevated water tanks, pumphouses, sprayers, and other
technological appurtenances.
Clearly, petitioner DAR has no power to regulate
livestock farms which have been exempted by the
Constitution from the coverage of agrarian reform. It has
exceeded its power in issuing the assailed A.O.[59]
Indeed, as pointed out by the CA, the instant case does not rest on facts parallel to
those of Sutton because, in Sutton, the subject property remained a livestock farm.
We even highlighted therein the fact that there has been no change of business
interest in the case of respondents.[60] Similarly, in Department of Agrarian Reform
v. Uy,[61] we excluded a parcel of land from CARP coverage due to the factual
findings of the MARO, which were confirmed by the DAR, that the property was
entirely devoted to livestock farming. However, in A.Z. Arnaiz Realty, Inc.,
represented by Carmen Z. Arnaiz v. Office of the President; Department of
Agrarian Reform; Regional Director, DAR Region V, Legaspi City; Provincial
Agrarian Reform Officer, DAR Provincial Office, Masbate, Masbate; and
Municipal Agrarian Reform Officer, DAR Municipal Office, Masbate, Masbate,
[62]
we denied a similar petition for exemption and/or exclusion, by according
 [1]
respect to the CAs factual findings and its reliance on the findings of the DAR and exclude a property from CARP coverage based on the factual circumstances of each Rollo, pp. 67-98.
the OP that case and in accordance with law and applicable jurisprudence. In addition, albeit
parenthetically, Secretary Villa had already granted the conversion into residential [2]
and golf courses use of nearly one-half of the entire area originally claimed as Penned by Associate Justice Noel G. Tijam, with Associate Justices Jose L.
the subject parcels of land were not directly, actually, and exclusively used for exempt from CARP coverage because it was allegedly devoted to livestock Sabio, Jr. and Japar B. Dimaampao, concurring; id. at 26-45.
pasture.[63] production.
[3]
Id. at 47-63.
In sum, we find no reversible error in the assailed Amended Decision and
Petitioners admission that, since 2001, it leased another ranch for its
Resolution of the CA which would warrant the modification, much less the reversal,
DIOSDADO M. PERALTA ROBERTO A. ABAD thereof. [4]
CA rollo, p. 103.

Associate Justice Associate Justice

[5]
Id. at 105-109.
[64]
own livestock is fatal to its cause. While petitioner advances a defense that it WHEREFORE, the Petition is DENIED and the Court of Appeals
leased this ranch because the occupants of the subject property harmed its cattle, Amended Decision dated October 4, 2006 and Resolution dated March 27, 2008 [6]
G.R. No. 86889, December 4, 1990, 192 SCRA 51.
like the CA, we find it surprising that not even a single police are AFFIRMED. No costs.
and/or barangay report was filed by petitioner to amplify its indignation over these
alleged illegal acts. Moreover, we accord respect to the CAs keen observation that SO ORDERED.
[7]
CA rollo, p. 102.
the assailed MARO reports and the Investigating Teams Report do not actually
contradict one another, finding that the 43 cows, while owned by petitioner, were
ANTONIO EDUARDO B. NACHURA Associate Justice [8]
Id. at 620-621.
actually pastured outside the subject property.
WE CONCUR:
Finally, it is established that issues of Exclusion and/or Exemption are [9]
Id. at 624-626.
characterized as Agrarian Law Implementation (ALI) cases which are well within ANTONIO T. CARPIO
the DAR Secretarys competence and jurisdiction. [65] Section 3, Rule II of the 2003
[10]
Department of Agrarian Reform Adjudication Board Rules of Procedure provides: Associate Justice Id. at 901.

Chairperson [11]
Section 3. Agrarian Law Implementation Cases. Docketed as CA-G.R. SP No. 43678, penned by Associate Justice Portia Alio-
Hormachuelos, with Associate Justices Buenaventura J. Guerrero and Remedios A.
MARTIN S. VILLARAMA, JR.
Salazar-Fernando, concurring; id. at 916-929.
The Adjudicator or the Board shall have no
Associate Justice
jurisdiction over matters involving the administrative
[12]
implementation of RA No. 6657, otherwise known as the Id. at 931-932.
AT T E S TAT I O N
Comprehensive Agrarian Reform Law (CARL) of 1988 and
other agrarian laws as enunciated by pertinent rules and I attest that the conclusions in the above Decision had been reached in consultation
[13]
Entitled An Act Amending Certain Provisions of Republic Act No. 6657,
administrative orders, which shall be under the exclusive before the case was assigned to the writer of the opinion of the Courts Division. Entitled An Act Instituting A Comprehensive Agrarian Reform Program to Promote
prerogative of and cognizable by the Office of the Secretary Social Justice and Industrialization, Providing the Mechanism for its
of the DAR in accordance with his issuances, to wit: ANTONIO T. CARPIO Implementation, and for Other Purposes.

Associate Justice

Chairperson, Second Division

xxxx [14]
CA rollo, pp. 656-662.
C E R T I F I C AT I O N
3.8 Exclusion from CARP coverage of agricultural land used Pursuant to Section 13, Article VIII of the Constitution and the Division
[15]
Id. at 660.
for livestock, swine, and poultry raising. Chairperson's Attestation, I certify that the conclusions in the above Decision had
been reached in consultation before the case was assigned to the writer of the [16]
Id. at 665-676.
opinion of the Courts Division.

RENATO C. CORONA [17]

Id. at 750-761.
Thus, we cannot, without going against the law, arbitrarily strip the DAR Secretary
of his legal mandate to exercise jurisdiction and authority over all ALI cases. To Chief Justice [18]
succumb to petitioners contention that when a land is declared exempt from the Id. at 762-780.
CARP on the ground that it is not agricultural as of the time the CARL took effect, *
the use and disposition of that land is entirely and forever beyond DARs Additional member in lieu of Associate Justice Jose Catral Mendoza per Raffle [19]
dated February 21, 2011. Id. at 82-89.
jurisdiction is dangerous, suggestive of self-regulation. Precisely, it is the DAR
Secretary who is vested with such jurisdiction and authority to exempt and/or
[20] [43] [59]
Id. at 74-81. Also referred to as Roger Lobedesis in other pleadings and documents. Supra note 36, at 183-184. (Emphasis supplied.)

[21] [44] [60]

Id. at 80. CA rollo, p. 1656. Id. at 185.

[22] [45] [61]

Id. at 11-71. Supra note 3, at 52-53. G.R. No. 169277, February 9, 2007, 515 SCRA 376, 401-402.

[23] [46] [62]

Rollo, pp. 23-24. Supra note 3. G.R. No. 170623, July 7, 2010.

[24] [47] [63]

CA rollo, pp. 1281-1291. Sec. 50 of R.A. No. 6657 provides: This Court takes note that DAR, with respect to our ruling in Sutton, issued DAR
A.O. No. 07, Series of 2008, entitled Guidelines relative to the Supreme Court
[25]
Id. at 1099-1108. Sec. 50. Quasi-judicial Powers of the DAR. The DAR is hereby vested Ruling on the Sutton Case regarding lands which are actually, directly and
with the primary jurisdiction to determine and adjudicate agrarian reform matters exclusively used for Livestock Raising, which provides that the property must be
[26] and shall have exclusive original jurisdiction over all matters involving the actually, directly and exclusively used as a livestock farm for it to be exempted.
Id. at 1110-1112.
implementation of agrarian reform, except those falling under the exclusive
[64]
[27]
jurisdiction of the Department of Agriculture (DA) and the Department of TSN, April 24, 2007, pp. 18 and 76.
Id. at 1117-1125. Environment and Natural Resources (DENR).
[65]
[28]
Sta. Ana v. Carpo, G.R. No. 164340, November 28, 2008, 572 SCRA 463, 482.
Id. at 1174-1180. [48]
Supra note 3, at 61.

[29]
Supra note 24. [49]
Supra note 1, at 79-80.

[30]
CA rollo, pp. 1184-1185. [50]
Id.

[31]
Id. at 1186. [51]
Rollo, pp. 2223-2237.

[32]
Id. at 1321-1324 and 1330-1332. [52]
Id. at 2512-2558.

[33]
Id. at 1359-1360. [53]
Id. at 2473-2481 and 2602-2615.

[34]
Id. at 1406-1409 and 1410-1416. [54]
Dosch v. NLRC, et al., 208 Phil. 259, 272 (1983).

[35]
Supra note 28, at 1180. [55]
DOH v. C.V. Canchela & Associates, Architects (CVCAA), 511 Phil. 654, 670
(2005).
[36]
510 Phil. 177 (2005).
[56]
Section 3 of Rule 43 of the 1997 Rules of Civil Procedure provides:
[37]
CA rollo, p. 1353.
SEC. 3. Where to appeal. An appeal under this Rule may be taken to the
[38]
Id. at 1464-1467. Court of Appeals within the period and in the manner herein provided, whether the
appeal involves questions of fact, of law, or mixed questions of fact and law.
[39]
Supra note 2, at 45.
[57]
Phil. Coconut Authority v. Corona International, Inc., 395 Phil. 742, 750 (2000),
[40]
CA rollo, pp.1502-1514. citing Acme Shoe, Rubber and Plastic Corp. v. CA, G.R. No. 103576, August 22,
1996, 260 SCRA 714, 719.
[41]
Exhibit D-2; CAs Folder of Exhibits. [58]
Zacarias v. National Police Commission, G.R. No. 119847, October 24, 2003,
[42]
414 SCRA 387, 393.
Exhibits E-1 to E-3; id.

FIRST DIVISION
[G.R. No. 158228. March 23, 2004]
DEPARTMENT OF AGRARIAN REFORM, as represented by its Secretary,
ROBERTO M. PAGDANGANAN, petitioner, vs. DEPARTMENT
OF EDUCATION, CULTURE AND SPORTS (DECS), respondent.
DECISION
YNARES-SANTIAGO, J.:
This petition for review on certiorari seeks to set aside the decision [1] of the
Court of Appeals dated October 29, 2002 in CA-G.R. SP No. 64378, which reversed
the August 30, 2000 decision of the Secretary of Agrarian Reform, as well as the
Resolution dated May 7, 2003, which denied petitioners motion for reconsideration.
In controversy are Lot No. 2509 and Lot No. 817-D consisting of an
aggregate area of 189.2462 hectares located at Hacienda Fe, Escalante, Negros
Occidental and Brgy. Gen. Luna, Sagay, Negros Occidental,
respectively. On October 21, 1921, these lands were donated by the late Esteban
Jalandoni to respondent DECS (formerly Bureau of Education). [2] Consequently,
titles thereto were transferred in the name of respondent DECS under Transfer
Certificate of Title No. 167175.[3]
On July 15, 1985, respondent DECS leased the lands to Anglo Agricultural
Corporation for 10 agricultural crop years, commencing from crop year 1984-1985
to crop year 1993-1994. The contract of lease was subsequently renewed for
another 10 agricultural crop years, commencing from crop year 1995-1996 to crop
year 2004-2005.[4]
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.[5]
After investigation, MARO Jacinto R. Piosa, 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 with the farmer beneficiaries. [6] Then,
MARO Piosa submitted his report to OIC-PARO Stephen M. Leonidas, who
recommended to the DAR Regional Director the approval of the coverage of the
landholdings.
On August 7, 1998, DAR Regional Director Dominador B. Andres approved
the recommendation, the dispositive portion of which reads:
WHEREFORE, all the foregoing premises considered, the petition is granted. Order
is hereby issued:
1. Placing under CARP coverage Lot 2509 with an area of 111.4791
hectares situated at Had. Fe, Escalante, Negros Occidental
and Lot 817-D with an area of 77.7671 hectares situated at Brgy.
Gen. Luna, Sagay, Negros Occidental;
2. Affirming the notice of coverage sent by the DAR Provincial
Office, Negros Occidental dated November 23, 1994;
3. Directing the Provincial Agrarian Reform Office of Negros
Occidental and the Municipal Agrarian Reform Officers of Sagay
and Escalante to facilitate the acquisition of the subject
landholdings and the distribution of the same qualified
beneficiaries.
SO ORDERED.[7]
Respondent DECS appealed the case to the Secretary of Agrarian Reform
which affirmed the Order of the Regional Director. [8]
Aggrieved, respondent DECS filed a petition for certiorari with the Court of
Appeals, which set aside the decision of the Secretary of Agrarian Reform. [9]
Hence, the instant petition for review.
The pivotal issue to be resolved in this case is 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).
The general policy under CARL is to cover as much lands suitable for
agriculture as possible.[10] Section 4 of R.A. No. 6657 sets out the coverage of
CARP. It states that the program shall:
cover, regardless of tenurial arrangement and commodity produced, all public and
private agricultural lands as provided in Proclamation No. 131 and Executive Order
No. 229, including other lands of the public domain suitable for agriculture.
More specifically, the following lands are covered by the Comprehensive Agrarian
Reform Program:
(a) All alienable and disposable lands of the public domain devoted to
or suitable for agriculture. No reclassification of forest or mineral
lands to agricultural lands shall be undertaken after the approval
of this Act until Congress, taking into account, ecological,
developmental and equity considerations, shall have determined
by law, the specific limits of the public domain;
(b) All lands of the public domain in excess of the specific limits as
determined by Congress in the preceding paragraph;
(c) All other lands owned by the Government devoted to or suitable
for agriculture; and
(d) All private lands devoted to or suitable for agriculture regardless
of the agricultural products raised or that can be raised thereon.
Section 3(c) thereof 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. The term agriculture or agricultural activity is also
defined by the same law as follows:
Agriculture, Agricultural Enterprises or Agricultural Activity means the cultivation
of the soil, planting of crops, growing of fruit trees, raising of livestock, poultry or
fish, including the harvesting of such farm products, and other farm activities, and
practices performed by a farmer in conjunction with such farming operations done
by persons whether natural or juridical.[11]
The records of the case show that the subject properties were formerly
private agricultural lands owned by the late Esteban Jalandoni, and were donated to
respondent DECS. From that time until they were leased to Anglo Agricultural
Corporation, the lands continued to be agricultural primarily planted to sugarcane,
albeit part of the public domain being owned by an agency of the government.
[12]
Moreover, there is no legislative or presidential act, before and after the
enactment of R.A. No. 6657, classifying the said lands as mineral, forest,
residential, commercial or industrial land. Indubitably, the subject lands fall under
the classification of lands of the public domain devoted to or suitable for
agriculture.
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.
Petitioner DAR, on the other hand, argued 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.
We agree with the petitioner.
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, viz:
xxxxxxxxx
c) 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, , shall be exempt
from the coverage of this Act.[13]
xxxxxxxxx
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.
The importance of the phrase actually, directly, and exclusively used
and found to be necessary cannot be understated, as what respondent DECS would
want us to do by not taking the words in their literal and technical definitions. The
words of the law are clear and unambiguous. Thus, the plain meaning rule or verba
legis in statutory construction is applicable in this case. Where the words of a
statute are clear, plain and free from ambiguity, it must be given its literal meaning
and applied without attempted interpretation.[14]
 [18]
We are not unaware of our ruling in the case of Central Mindanao University CARP. Since the identification and selection of CARP beneficiaries are matters Rollo, p. 87.
v. Department of Agrarian Reform Adjudication Board,[15]wherein we declared the involving strictly the administrative implementation of the CARP,[19] it behooves the [19]
land subject thereof exempt from CARP coverage. However, respondent DECS courts to exercise great caution in substituting its own determination of the issue, Lercana v. Jalandoni, G.R. No. 132286, 1 February 2002.
reliance thereon is misplaced because the factual circumstances are different in the unless there is grave abuse of discretion committed by the administrative agency. In [20]
Secretary of Agrarian Reform v. Tropical Homes, Inc., G.R. No. 136799, 31 July
case at bar. this case, there was none.
2001.
Firstly, in the CMU case, the land involved was not alienable and disposable The Comprehensive Agrarian Reform Program (CARP) is the bastion of
land of the public domain because it was reserved by the late President Carlos P. social justice of poor landless farmers, the mechanism designed to redistribute to
Garcia under Proclamation No. 476 for the use the underprivileged the natural right to toil the earth, and to liberate them from
of Mindanao Agricultural College (now CMU).[16] In this case, however, the lands oppressive tenancy. To those who seek its benefit, it is the means towards a viable
fall under the category of alienable and disposable lands of the public domain livelihood and, ultimately, a decent life. The objective of the State is no less certain:
suitable for agriculture. landless farmers and farmworkers will receive the highest consideration to promote
social justice and to move the nation toward sound rural development and
Secondly, in the CMU case, the land was actually, directly and exclusively industrialization.[20]
used and found to be necessary for school sites and campuses. Although a portion
of it was being used by the Philippine Packing Corporation (now Del Monte Phils., WHEREFORE, in view of the foregoing, the petition is GRANTED. The
Inc.) under a Management and Development Agreement, the undertaking was that decision of the Court of Appeals dated October 29, 2002, in CA-G.R. SP No. 64378
the land shall be used by the Philippine Packing Corporation as part of the CMU is REVERSED and SET ASIDE. The decision dated August 30, 2000 of the
research program, with direct participation of faculty and students. Moreover, the Secretary of Agrarian Reform placing the subject lands under CARP coverage, is
land was part of the land utilization program developed by the CMU for its REINSTATED.
Kilusang Sariling Sikap Project (CMU-KSSP), a multi-disciplinary applied research
extension and productivity program.[17]Hence, the retention of the land was found to SO ORDERED.
be necessary for the present and future educational needs of the CMU. On the other
Davide, Jr., C.J., (Chairman), Carpio, and Azcuna, JJ., concur.
hand, the lands in this case were not actually and exclusively utilized as school sites
Panganiban, J., on official leave.
and campuses, as they were leased to Anglo Agricultural Corporation, not for
educational purposes but for the furtherance of its business. Also, as conceded by
respondent DECS, it was the income from the contract of lease and not the subject
lands that was directly used for the repairs and renovations of the schools in the
locality.
[1]
Penned by Justice Andres B. Reyes, Jr. and concurred in by Justice Delilah
Anent the issue of whether the farmers are qualified beneficiaries of CARP, Vidallon-Magtolis and Justice Regalado E. Maambong.
we disagree with the Court of Appeals finding that they were not.
[2]
CA Rollo, pp. 99-100.
At the outset, it should be pointed out that the identification of actual and
potential beneficiaries under CARP is vested in the Secretary of Agrarian Reform [3]
Id., pp. 335-337.
pursuant to Section 15, R.A. No. 6657, which states:
[4]
Id., pp. 104-107.
SECTION 15. Registration of Beneficiaries. The DAR in coordination with the [5]
Id., pp. 39-44.
Barangay Agrarian Reform Committee (BARC) as organized in this Act, shall
[6]
register all agricultural lessees, tenants and farmworkers who are qualified to be Id., p. 38.
beneficiaries of the CARP. These potential beneficiaries with the assistance of the [7]
BARC and the DAR shall provide the following data: Id., p. 53.
[8]
Id., pp. 82-83.
(a) names and members of their immediate farm household; [9]
(b) owners or administrators of the lands they work on and the length Rollo, p. 46.
of tenurial relationship; [10]
DAR Adm. Order No. 13, Series of 1990.
(c) location and area of the land they work;
(d) crops planted; and [11]
Section 3(b), RA 6657.
(e) their share in the harvest or amount of rental paid or wages
received. [12]
Chavez v. Public Estates Authority, G.R. No. 133250, 9 July 2002, 384 SCRA
152, 239.
A copy of the registry or list of all potential CARP beneficiaries in the barangay [13]
Section 10, R.A. No. 6657, as amended by R.A. No. 7881.
shall be posted in the barangay hall, school or other public buildings in the
barangay where it shall be open to inspection by the public at all reasonable hours. [14]
Osea v. Malaya, G.R. No. 139821, 30 January 2002, 375 SCRA 285.
[15]
G.R. No. 100091, 22 October 1992, 215 SCRA 86.
In the case at bar, the BARC certified that herein farmers were potential
CARP beneficiaries of the subject properties.[18] Further, on November 23, 1994, the [16]
Supra, p. 89.
Secretary of Agrarian Reform through the Municipal Agrarian Reform Office
[17]
(MARO) issued a Notice of Coverage placing the subject properties under Supra, pp. 97-98.
 x------------------------------------x PERALTA,

ROXAS & CO., INC., BERSAMIN,

EN BANC Petitioner, DEL CASTILLO,

ROXAS & COMPANY, INC., - versus - ABAD, and

Petitioner, DAMBA-NFSW, VILLARAMA, JJ.

- versus - Respondent. Promulgated:

DAMBA-NFSW and the DEPARTMENT OF AGRARIAN REFORM,* x------------------------------------x December 4, 2009

Respondents. DAMBA-NFSW REPRESENTED BY LAURO V. MARTIN, G.R. No. 167540

x------------------------------------x Petitioner, G.R. No. 167543

DAMAYAN NG MGA MANGGAGAWANG BUKID SA ASYENDA ROXAS- - versus- G.R. No. 167845
NATIONAL FEDERATION OF SUGAR WORKERS (DAMBA-NFSW),
ROXAS & CO., INC., G.R. No. 169163
Petitioner,
Respondent. G.R. No. 179650
- versus -
x-----------------------------------x x----------------------------------------------------------------------------------------x
SECRETARY OF THE DEPT. OF AGRARIAN REFORM, ROXAS & Co., INC.
AND/OR ATTY. MARIANO AMPIL, DAMBA-NFSW, DECISION

Respondents. Petitioner, CARPIO MORALES, J.

x-----------------------------------x - versus - The main subject of the seven consolidated petitions is the application of petitioner
Roxas & Co., Inc. (Roxas & Co.) for conversion from agricultural to non-
KATIPUNAN NG MGA MAGBUBUKID SA HACIENDA ROXAS, INC. ROXAS & CO., INC., agricultural use of its three haciendas located in Nasugbu, Batangas containing a
(KAMAHARI), rep. by its President CARLITO CAISIP, and DAMAYAN NG total area of almost 3,000 hectares. The facts are not new, the Court having earlier
MANGGAGAWANG BUKID SA ASYENDA ROXAS-NATIONAL Respondent. resolved intimately-related issues dealing with these haciendas. Thus, in the 1999
FEDERATION OF SUGAR WORKERS (DAMBA-NFSW), represnted by case of Roxas & Co., Inc. v. Court of Appeals,[1] the Court presented the facts as
LAURO MARTIN, G.R. No. 149548 follows:

Petitioners, G.R. No. 167505 . . . Roxas & Co. is a domestic corporation and is the registered owner of three
haciendas, namely, Haciendas Palico, Banilad and Caylaway, all located in the
- versus - Present: Municipality of Nasugbu, Batangas. Hacienda Palico is 1,024 hectares in area and is
registered under Transfer Certificate of Title (TCT) No. 985. This land is covered
SECRETARY OF THE DEPT. OF AGRARIAN REFORM, ROXAS & Co., INC., by Tax Declaration Nos. 0465, 0466, 0468, 0470, 0234 and 0354. Hacienda Banilad
PUNO, C.J.,
is 1,050 hectares in area, registered under TCT No. 924 and covered by Tax
Respondents. Declaration Nos. 0236, 0237 and 0390. Hacienda Caylaway is 867.4571 hectares in
CARPIO,
area and is registered under TCT Nos. T-44662, T-44663, T-44664 and T-44665.
x------------------------------------------x CORONA,
xxxx
DEPARTMENT OF LAND REFORM, FORMERLY DEPARTMENT OF CARPIO MORALES,
AGRARIAN REFORM (DAR), 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,
CHICO-NAZARIO, the Comprehensive Agrarian Reform Law (CARL) of 1988. The Act was signed by
Petitioner,
the President on June 10, 1988 and took effect on June 15, 1988.
VELASCO, JR.,
- versus -
NACHURA,
ROXAS & CO, INC.,
LEONARDO-DE CASTRO, BRION, Before the laws effectivity, on May 6, 1988, [Roxas & Co.] filed with respondent
Respondent. DAR a voluntary offer to sell [VOS] Hacienda Caylaway pursuant to the provisions
of E.O. No. 229. Haciendas Palico and Banilad were later placed under compulsory
acquisition by DAR in accordance with the CARL.
xxxx
Nevertheless, on August 6, 1992, [Roxas & Co.], through its President, Eduardo J.
Roxas, sent a letter to the Secretary of DAR withdrawing its VOS of Hacienda
Caylaway. The Sangguniang Bayan of Nasugbu, Batangas allegedly authorized the
reclassification of Hacienda Caylaway from agricultural to non-agricultural. As a
result, petitioner informed respondent DAR that it was applying for conversion of
Hacienda Caylaway from agricultural to other uses.
x x x x[2] (emphasis and underscoring supplied)
The petitions in G.R. Nos. 167540 and 167543 nub on the interpretation of
Presidential Proclamation (PP) 1520 which was issued on November 28, 1975 by
then President Ferdinand Marcos. The PP reads:
DECLARING THE MUNICIPALITIES OF MARAGONDON AND TERNATE
IN CAVITE PROVINCE AND THE MUNICIPALITY OF NASUGBU IN
BATANGAS AS A TOURIST ZONE, AND FOR OTHER PURPOSES
WHEREAS, certain areas in the sector comprising the Municipalities of
Maragondon and Ternate in Cavite Province and Nasugbu in Batangas have
potential tourism value after being developed into resort complexes for the foreign
and domestic market; and
WHEREAS, it is necessary to conduct the necessary studies and to segregate
specific geographic areas for concentrated efforts of both the government and
private sectors in developing their tourism potential;
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines,
by virtue of the powers vested in me by the Constitution, do hereby declare the area
comprising the Municipalities of Maragondon and Ternate in Cavite Province and
Nasugbu in Batangas Province as a tourist zone under the administration and
control of the Philippine Tourism Authority (PTA) pursuant to Section 5 (D) of P.D.
564.
The PTA shall identify well-defined geographic areas within the zone with
potential tourism value, wherein optimum use of natural assets and attractions, as
well as existing facilities and concentration of efforts and limited resources of both
government and private sector may be affected and realized in order to generate
foreign exchange as well as other tourist receipts.
Any duly established military reservation existing within the zone shall be
excluded from this proclamation.
All proclamation, decrees or executive orders inconsistent herewith are hereby
revoked or modified accordingly. (emphasis and underscoring supplied).
The incidents which spawned the filing of the petitions in G.R. Nos. 149548,
167505, 167845, 169163 and 179650 are stated in the dissenting opinion of Justice
Minita Chico-Nazario, the original draft of which was made the basis of the Courts
deliberations.
Essentially, Roxas & Co. filed its application for conversion of its three haciendas
from argricultural to non-agricultural on the assumption that the issuance of PP
1520 which declared Nasugbu, Batangas as a tourism zone, reclassified them to
non-agricultural uses. Its pending application notwithstanding, the Department of
Agrarian Reform (DAR) issued Certificates of Land Ownership Award (CLOAs) to
the farmer-beneficiaries in the three haciendas including CLOA No. 6654 which
was issued on October 15, 1993 covering 513.983 hectares, the subject of G.R. No.
167505.
The application for conversion of Roxas & Co. was the subject of the above-stated
Roxas & Co., Inc. v. Court of Appeals which the Court remanded to the DAR for
the observance of proper acquisition proceedings. As reflected in the above-quoted
statement of facts in said case, during the pendency before the DAR of its
application for conversion following its remand to the DAR or on May 16, 2000,
Roxas & Co. filed with the DAR an application for exemption from the coverage of
the Comprehensive Agrarian Reform Program (CARP) of 1988 on the basis of PP
1520 and of DAR Administrative Order (AO) No. 6, Series of 1994[3] which states
that all lands already classified as commercial, industrial, or residential before the
effectivity of CARP no longer need conversion clearance from the DAR.
It bears mentioning at this juncture that on April 18, 1982, the Sangguniang Bayan
of Nasugbu enacted Municipal Zoning Ordinance No. 4 (Nasugbu MZO No. 4)
which was approved on May 4, 1983 by the Human Settlements Regulation
Commission, now the Housing and Land Use Regulatory Board (HLURB).
The records show that Sangguniang Bayan and Association of Barangay Captains
of Nasugbu filed before this Court petitions for intervention which were, however,
denied by Resolution of June 5, 2006 for lack of standing.[4]
After the seven present petitions were consolidated and referred to the Court en
banc,[5] oral arguments were conducted on July 7, 2009.
The core issues are:
1. Whether PP 1520 reclassified in 1975 all lands in the Maragondon-Ternate-
Nasugbu tourism zone to non-agricultural use to exempt Roxas & Co.s three
haciendas in Nasugbu from CARP coverage;
2. Whether Nasugbu MSO No. 4, Series of 1982 exempted certain lots in
Hacienda Palico from CARP coverage; and
3. Whether the partial and complete cancellations by the DAR of CLOA No.
6654 subject of G.R. No. 167505 is valid.
The Court shall discuss the issues in seriatim.
I. PP 1520 DID NOT AUTOMATICALLY CONVERT THE AGRICULTURAL
LANDS IN THE THREE MUNICIPALITIES INCLUDING NASUGBU TO NON-
AGRICULTURAL LANDS.
Roxas & Co. contends that PP 1520 declared the three municipalities as each
constituting a tourism zone, reclassified all lands therein to tourism and, therefore,
converted their use to non-agricultural purposes.
To determine the chief intent of PP 1520, reference to the whereas clauses is in
order. By and large, a reference to the congressional deliberation records would
provide guidance in dissecting the intent of legislation. But since PP 1520 emanated
from the legislative powers of then President Marcos during martial rule, reference
to the whereas clauses cannot be dispensed with.[6]
The perambulatory clauses of PP 1520 identified only certain areas in the sector
comprising the [three Municipalities that] have potential tourism value and
mandated the conduct of necessary studies and the segregation of specific
geographic areas to achieve its purpose. Which is why the PP directed the
Philippine Tourism Authority (PTA) to identify what those potential tourism areas
are. If all the lands in those tourism zones were to be wholly converted to non-
agricultural use, there would have been no need for the PP to direct the PTA to
identify what those specific geographic areas are.
The Court had in fact passed upon a similar matter before. Thus in DAR v. Franco,
[7] it pronounced:
Thus, the DAR Regional Office VII, in coordination with the Philippine Tourism
Authority, has to determine precisely which areas are for tourism development and
excluded from the Operation Land Transfer and the Comprehensive Agrarian
Reform Program. And suffice it to state here that the Court has repeatedly ruled that
lands already classified as non-agricultural before the enactment of RA 6657 on 15
June 1988 do not need any conversion clearance.[8] (emphasis and underscoring
supplied).
While the above pronouncement in Franco is an obiter, it should not be ignored in
the resolution of the present petitions since it reflects a more rational and just
interpretation of PP 1520. There is no prohibition in embracing the rationale of an
obiter dictum in settling controversies, or in considering related proclamations
establishing tourism zones.
In the above-cited case of Roxas & Co. v. CA,[9] the Court made it clear that the
power to determine whether Haciendas Palico, Banilad and Caylaway are non-
agricultural, hence, exempt from the coverage of the [Comprehensive Agrarian
Reform Law] lies with the [Department of Agrarian Reform], not with this Court.
[10] The DAR, an administrative body of special competence, denied, by Order of
October 22, 2001, the application for CARP exemption of Roxas & Co., it finding
that PP 1520 did not automatically reclassify all the lands in the affected
municipalities from their original uses. It appears that the PTA had not yet, at that
time, identified the specific geographic areas for tourism development and had no
pending tourism development projects in the areas. Further, report from the Center
for Land Use Policy Planning and Implementation (CLUPPI) indicated that the
areas were planted with sugar cane and other crops.[11]
Relatedly, the DAR, by Memorandum Circular No. 7, Series of 2004,[12] came up
with clarificatory guidelines and therein decreed that
A. x x x x.
B. Proclamations declaring general areas such as whole provinces, municipalities,
barangays, islands or peninsulas as tourist zones that merely:
(1) recognize certain still unidentified areas within the covered provinces,
municipalities, barangays, islands, or peninsulas to be with potential tourism value
and charge the Philippine Tourism Authority with the task to identify/delineate
specific geographic areas within the zone with potential tourism value and to
coordinate said areas development; or
(2) recognize the potential value of identified spots located within the general area
declared as tourist zone (i.e. x x x x) and direct the Philippine Tourism Authority to
coordinate said areas development;
 could not be regarded as effecting an automatic reclassification of the entirety of
the land area declared as tourist zone. This is so because reclassification of lands
denotes their allocation into some specific use and providing for the manner of their
utilization and disposition (Sec. 20, Local Government Code) or the act of
specifying how agricultural lands shall be utilized for non-agricultural uses such as
residential, industrial, or commercial, as embodied in the land use plan. (Joint
HLURB, DAR, DA, DILG Memo. Circular Prescribing Guidelines for MC 54, S.
1995, Sec.2)
A proclamation that merely recognizes the potential tourism value of certain areas
within the general area declared as tourist zone clearly does not allocate, reserve, or
intend the entirety of the land area of the zone for non-agricultural purposes.
Neither does said proclamation direct that otherwise CARPable lands within the
zone shall already be used for purposes other than agricultural.
Moreover, to view these kinds of proclamation as a reclassification for non-
agricultural purposes of entire provinces, municipalities, barangays, islands, or
peninsulas would be unreasonable as it amounts to an automatic and sweeping
exemption from CARP in the name of tourism development. The same would also
undermine the land use reclassification powers vested in local government units in
conjunction with pertinent agencies of government.
C. There being no reclassification, it is clear that said proclamations/issuances,
assuming [these] took effect before June 15, 1988, could not supply a basis for
exemption of the entirety of the lands embraced therein from CARP coverage x x x
x.
D. x x x x. (underscoring in the original; emphasis and italics supplied)
The DARs reading into these general proclamations of tourism zones deserves
utmost consideration, more especially in the present petitions which involve vast
tracts of agricultural land. To reiterate, PP 1520 merely recognized the potential
tourism value of certain areas within the general area declared as tourism zones. It
did not reclassify the areas to non-agricultural use.
Apart from PP 1520, there are similarly worded proclamations declaring the whole
of Ilocos Norte and Bataan Provinces, Camiguin, Puerto Prinsesa, Siquijor, Panglao
Island, parts of Cebu City and Municipalities of Argao and Dalaguete in Cebu
Province as tourism zones.[13]
Indubitably, these proclamations, particularly those pertaining to the Provinces of
Ilocos Norte and Bataan, did not intend to reclassify all agricultural lands into non-
agricultural lands in one fell swoop. The Court takes notice of how the agrarian
reform program wasand still isimplemented in these provinces since there are lands
that do not have any tourism potential and are more appropriate for agricultural
utilization.
Relatedly, a reference to the Special Economic Zone Act of 1995[14] provides a
parallel orientation on the issue. Under said Act, several towns and cities
encompassing the whole Philippines were readily identified as economic zones.[15]
To uphold Roxas & Co.s reading of PP 1520 would see a total reclassification of
practically all the agricultural lands in the country to non-agricultural use.
Propitiously, the legislature had the foresight to include a bailout provision in
Section 31 of said Act for land conversion.[16] The same cannot be said of PP
1520, despite the existence of Presidential Decree (PD) No. 27 or the Tenant
Emancipation Decree,[17] which is the precursor of the CARP.
Interestingly, then President Marcos also issued on September 26, 1972 PD No. 2
which declared the entire Philippines as land reform area.[18] Such declaration did
not intend to reclassify all lands in the entire country to agricultural lands. President
Marcos, about a month later or on October 21, 1972, issued PD 27 which decreed
that all private agricultural lands primarily devoted to rice and corn were deemed
awarded to their tenant-farmers.
Given these martial law-era decrees and considering the socio-political backdrop at
the time PP 1520 was issued in 1975, it is inconceivable that PP 1520, as well as
other similarly worded proclamations which are completely silent on the aspect of
reclassification of the lands in those tourism zones, would nullify the gains already
then achieved by PD 27.
Even so, Roxas & Co. turns to Natalia Realty v. DAR and NHA v. Allarde to
support its position. These cases are not even closely similar to the petitions in G.R.
Nos. 167540 and 167543. The only time that these cases may find application to
said petitions is when the PTA actually identifies well-defined geographic areas
within the zone with potential tourism value.
In remotely tying these two immediately-cited cases that involve specific and
defined townsite reservations for the housing program of the National Housing
Authority to the present petitions, Roxas & Co. cites Letter of Instructions No. 352
issued on December 22, 1975 which states that the survey and technical description
of the tourism zones shall be considered an integral part of PP 1520. There were,
however, at the time no surveys and technical delineations yet of the intended
tourism areas.
On hindsight, Natalia and Allarde find application in the petitions in G.R. Nos.
179650 & 167505, which petitions are anchored on the extenuating effects of
Nasugbu MZO No. 4, but not in the petitions in G.R. Nos. 167540 & 167543
bearing on PP 1520, as will later be discussed.
Of significance also in the present petitions is the issuance on August 3, 2007 of
Executive Order No. 647[19] by President Arroyo which proclaimed the areas in the
Nasugbu Tourism Development Plan as Special Tourism Zone. Pursuant to said
Executive Order, the PTA completed its validation of 21 out of 42 barangays as
tourism priority areas, hence, it is only after such completion that these identified
lands may be subjected to reclassification proceedings.
It bears emphasis that a mere reclassification of an agricultural land does not
automatically allow a landowner to change its use since there is still that process of
conversion before one is permitted to use it for other purposes.[20]
Tourism Act, and not to PP 1520, for possible exemption.
II. ROXAS & CO.S APPLICATION IN DAR ADMINISTRATIVE CASE NO. A-
9999-142-97 FOR CARP EXEMPTION IN HACIENDA PALICO SUBJECT OF
G.R. NO. 179650 CANNOT BE GRANTED IN VIEW OF DISCREPANCIES IN
THE LOCATION AND IDENTITY OF THE SUBJECT PARCELS OF LAND.
Since PP 1520 did not automatically convert Haciendas Caylaway, Banilad and
Palico into non-agricultural estates, can Roxas & Co. invoke in the alternative
Nasugbu MZO No. 4, which reclassified in 1982 the haciendas to non-agricultural
use to exclude six parcels of land in Hacienda Palico from CARP coverage?
By Roxas & Co.s contention, the affected six parcels of land which are the subject
of DAR Administrative Case No. A-9999-142-97 and nine parcels of land which are
the subject of DAR Administrative Case No. A-9999-008-98 involved in G.R. No.
167505, all in Hacienda Palico, have been reclassified to non-agricultural uses via
Nasugbu MZO No. 4 which was approved by the forerunner of HLURB.
Roxas & Co.s contention fails.
To be sure, the Court had on several occasions decreed that a local government unit
has the power to classify and convert land from agricultural to non-agricultural
prior to the effectivity of the CARL.[23] In Agrarian Reform Beneficiaries
Association v. Nicolas,[24] it reiterated that
. . . the facts obtaining in this case are similar to those in Natalia Realty. Both
subject lands form part of an area designated for non-agricultural purposes. Both
were classified as non-agricultural lands prior to June 15, 1988, the date of
effectivity of CARL.
xxxx
In the case under review, the subject parcels of lands were reclassified within an
urban zone as per approved Official Comprehensive Zoning Map of the City of
Davao. The reclassification was embodied in City Ordinance No. 363, Series of
1982. As such, the subject parcels of land are considered non-agricultural and may
be utilized for residential, commercial, and industrial purposes. The reclassification
was later approved by the HLURB.[25] (emphasis, italics and underscoring
supplied)
The DAR Secretary[26] denied the application for exemption of Roxas & Co.,
however, in this wise:
Initially, CLUPPI-2 based [its] evaluation on the lot nos. as appearing in CLOA
No. 6654. However, for purposes of clarity and to ensure that the area applied for
exemption is indeed part of TCT No. T-60034, CLUPPI-2 sought to clarify with
[Roxas & Co.] the origin of TCT No. T-60034. In a letter dated May 28, 1998,
[Roxas & Co.] explains that portions of TCT No. T-985, the mother title, was
subdivided into 125 lots pursuant to PD 27. A total of 947.8417 was retained by the
landowners and was subsequently registered under TCT No. 49946. [[Roxas & Co.]
further explains that TCT No. 49946 was further subdivided into several lots (Lot
125-A to Lot 125-P) with Lot No. 125-N registered under TCT No. 60034. [A]
review of the titles, however, shows that the origin of T-49946 is T-783 and not T-
985. On the other hand, the origin of T-60034 is listed as 59946, and not T-49946.
The discrepancies were attributed by [Roxas & Co.] to typographical errors which
were acknowledged and initialled [sic] by the ROD. Per verification, the
discrepancies . . . cannot be ascertained.[27] (emphasis and underscoring supplied)
In denying Roxas & Co.s motion for reconsideration, the DAR Secretary held:
The landholdings covered by the aforesaid titles do not correspond to the
Certification dated February 11, 1998 of the [HLURB] , the Certification dated
September 12, 1996 issued by the Municipal Planning and Development
Coordinator, and the Certifications dated July 31, 1997 and May 27, 1997 issued by
the National Irrigation Authority. The certifications were issued for Lot Nos. 21, 24,
28, 31, 32 and 34. Thus, it was not even possible to issue exemption clearance over
the lots covered by TCT Nos. 60019 to 60023.
Furthermore, we also note the discrepancies between the certifications issued by
the HLURB and the Municipal Planning Development Coordinator as to the area of
the specific lots.[28] (emphasis and underscoring supplied)
In affirming the DAR Secretarys denial of Roxas & Co.s application for
exemption, the Court of Appeals, in CA-G.R. SP No. 63146 subject of G.R. No.
179650, observed:
 In the instant case, a perusal of the documents before us shows that there is no
indication that the said TCTs refer to the same properties applied for exemption by
[Roxas & Co.] It is true that the certifications refer, among others, to DAR Lot Nos.
21, 24, 28, 31, 32 and 34But these certifications contain nothing to show that these
lots are the same as Lots 125-A, 125-B, 125-C, 125-D and 125-E covered by TCT
Nos. 60019, 60020, 60021, 60022 and 60023, respetively. While [Roxas & Co.]
claims that DAR Lot Nos. 21, 24 and 31 correspond to the aforementioned TCTs
submitted to the DAR no evidence was presented to substantiate such allegation.
Moreover, [Roxas & Co.] failed to submit TCT 634 which it claims covers DAR
Lot Nos. 28, 32 and 24.(TSN, April 24, 2001, pp. 43-44)
xxxx
[Roxas & Co.] also claims that subject properties are located at Barangay Cogunan
and Lumbangan and that these properties are part of the zone classified as Industrial
under Municipal Ordinance No. 4, Series of 1982 of the Municipality of Nasugbu,
Batangas. .a scrutiny of the said Ordinance shows that only Barangays Talangan and
Lumbangan of the said municipality were classified as Industrial ZonesBarangay
Cogunan was not included. x x x x. In fact, the TCTs submitted by [Roxas & Co.]
show that the properties covered by said titles are all located at Barrio Lumbangan.
[29] (emphasis and underscoring supplied)
Its foregoing findings notwithstanding, the appellate court still allowed Roxas &
Co. to adduce additional evidence to support its application for exemption under
Nasugbu MZO No. 4.
Meanwhile, Roxas & Co. appealed the appellate courts decision in CA-G.R. No.
SP No. 63146 affirming the DAR Secretarys denial of its application for CARP
exemption in Hacienda Palico (now the subject of G.R. No. 149548).
When Roxas & Co. sought the re-opening of the proceedings in DAR
Administrative Case No. A-9999-142-97 (subject of G.R. No. 179650), and offered
additional evidence in support of its application for CARP exemption, the DAR
Secretary, this time, granted its application for the six lots including Lot No. 36
sincza the additional documents offered by Roxas & Co. mentioned the said lot.
In granting the application, the DAR Secretary[30] examined anew the evidence
submitted by Roxas & Co. which consisted mainly of certifications from various
local and national government agencies.[31] Petitioner in G.R. Nos. 167505,
167540, 169163 and 179650, Damayan Ng Mga Manggagawang Bukid Sa Asyenda
Roxas-National Federation of Sugar Workers (DAMBA-NFSW), the organization
of the farmer-beneficiaries, moved to have the grant of the application reconsidered
but the same was denied by the DAR by Order of December 12, 2003, hence, it
filed a petition for certiorari before the Court of Appeals, docketed as CA-G.R. SP
No. 82225, on grounds of forum-shopping and grave abuse of discretion. The
appellate court, by Decision of October 31, 2006, ruled that DAMBA-NFSW
availed of the wrong mode of appeal. At all events, it dismissed its petition as it
upheld the DAR Secretarys ruling that Roxas & Co. did not commit forum-
shopping, hence, the petition of DAMBA-NGSW in G.R. No. 179650.
While ordinarily findings of facts of quasi-judicial agencies are generally accorded
great weight and even finality by the Court if supported by substantial evidence in
recognition of their expertise on the specific matters under their consideration,[32]
this legal precept cannot be made to apply in G.R. No. 179650.
Even as the existence and validity of Nasugbu MZO No. 4 had already been
established, there remains in dispute the issue of whether the parcels of land
involved in DAR Administrative Case No. A-9999-142-97 subject of G.R. No.
179650 are actually within the said zoning ordinance.
The Court finds that the DAR Secretary indeed committed grave abuse of
discretion when he ignored the glaring inconsistencies in the certifications
submitted early on by Roxas & Co. in support of its application vis--vis the
certifications it later submitted when the DAR Secretary reopened DAR
Administrative Case No. A-9999-142-97.
Notably, then DAR Secretary Horacio Morales, on one hand, observed that the
landholdings covered by the aforesaid titles do not correspond to the Certification
dated February 11, 1998 of the [HLURB], the Certification dated September 12,
1996 issued by the Municipal Planning and Development Coordinator, and the
Certifications dated July 31, 1997 and May 27, 1997 issued by the National
Irrigation Authority. On the other hand, then Secretary Hernani Braganza relied on a
different set of certifications which were issued later or on September 19, 1996.
In this regard, the Court finds in order the observation of DAMBA-NFSW that
Roxas & Co. should have submitted the comprehensive land use plan and pointed
therein the exact locations of the properties to prove that indeed they are within the
area of coverage of Nasugbu MZO No. 4.
The petitions in G.R. Nos. 179650 & 149548 must be distinguished from Junio v.
Garilao[33] wherein the certifications submitted in support of the application for
exemption of the therein subject lot were mainly considered on the presumption of
regularity in their issuance, there being no doubt on the location and identity of the
subject lot.[34] In G.R. No. 179650, there exist uncertainties on the location and
identities of the properties being applied for exemption.
G.R. No. 179650 & G.R. No. 149548 must accordingly be denied for lack of merit.
III. ROXAS & CO.S APPLICATION FOR CARP EXEMPTION IN DAR
ADMINISTRATIVE CASE NO. A-9999-008-98 FOR THE NINE PARCELS OF
LAND IN HACIENDA PALICO SUBJECT OF G.R. NO. 167505 SHOULD BE
GRANTED.
The Court, however, takes a different stance with respect to Roxas & Co.s
application for CARP exemption in DAR Administrative Case No. A-9999-008-98
over nine parcels of land identified as Lot Nos. 20, 13, 37, 19-B, 45, 47, 49, 48-1
and 48-2 which are portions of TCT No. 985 covering 45.9771 hectares in Hacienda
Palico, subject of G.R. No. 167505.
In its application, Roxas & Co. submitted the following documents:
1. Letter-application dated 29 September 1997 signed by Elino SJ. Napigkit, for
and on behalf of Roxas & Company, Inc., seeking exemption from CARP coverage
of subject landholdings;
2. Secretarys Certificate dated September 2002 executed by Mariano M. Ampil
III, Corporate Secretary of Roxas & Company, Inc., indicating a Board Resolution
authorizing him to represent the corporation in its application for exemption with
the DAR. The same Board Resolution revoked the authorization previously granted
to the Sierra Management & Resources Corporation;
3. Photocopy of TCT No. 985 and its corresponding Tax Declaration No. 0401;
4. Location and vicinity maps of subject landholdings;
5. Certification dated 10 July 1997 issued by Reynaldo Garcia, Municipal
Planning and Development Coordinator (MPDC) and Zoning Administrator of
Nasugbu, Batangas, stating that the subject parcels of land are within the Urban
Core Zone as specified in Zone A. VII of Municipal Zoning Ordinance No. 4, Series
of 1982, approved by the Human Settlements Regulatory Commission (HSRC),
now the Housing and Land Use Regulatory Board (HLURB), under Resolution No.
123, Series of 1983, dated 4 May 1983;
6. Two (2) Certifications both dated 31 August 1998, issued by Alfredo Tan II,
Director, HLURB, Region IV, stating that the subject parcels of land appear to be
within the Residential cluster Area as specified in Zone VII of Municipal Zoning
Ordinance No. 4, Series of 1982, approved under HSRC Resolution No. 123, Series
of 1983, dated 4 May 1983;[35]
x x x x (emphasis and underscoring supplied)
By Order of November 6, 2002, the DAR Secretary granted the application for
exemption but issued the following conditions:
1. The farmer-occupants within subject parcels of land shall be maintained in
their peaceful possession and cultivation of their respective areas of tillage until a
final determination has been made on the amount of disturbance compensation due
and entitlement of such farmer-occupants thereto by the PARAD of Batangas;
2. No development shall be undertaken within the subject parcels of land until
the appropriate disturbance compensation has been paid to the farmer-occupants
who are determined by the PARAD to be entitled thereto. Proof of payment of
disturbance compensation shall be submitted to this Office within ten (10) days
from such payment; and
3. The cancellation of the CLOA issued to the farmer-beneficiaries shall be
subject of a separate proceeding before the PARAD of Batangas.[36]
DAMBA-NSFW moved for reconsideration but the DAR Secretary denied the
same and explained further why CLOA holders need not be informed of the pending
application for exemption in this wise:
As regards the first ground raised by [DAMBA-NSFW], it should be remembered
that an application for CARP-exemption pursuant to DOJ Opinion No. 44, series of
1990, as implemented by DAR Administrative Order No. 6, series of 1994, is non-
adversarial or non-litigious in nature. Hence, applicant is correct in saying that
nowhere in the rules is it required that occupants of a landholding should be notified
of an initiated or pending exemption application.
xxxx
With regard [to] the allegation that oppositors-movants are already CLOA holders
of subject propert[ies] and deserve to be notified, as owners, of the initiated
questioned exemption application, is of no moment. The Supreme Court in the case
of Roxas [&] Co., Inc. v. Court of Appeals, 321 SCRA 106, held:
We stress that the failure of respondent DAR to comply with the requisites of due
process in the acquisition proceedings does not give this Court the power to nullify
the CLOAs already issued to the farmer beneficiaries. x x x x. Anyhow, the
farmer[-]beneficiaries hold the property in trust for the rightful owner of the land.
Since subject landholding has been validly determined to be CARP-exempt,
therefore, the previous issuance of the CLOA of oppositors-movants is erroneous.
Hence, similar to the situation of the above-quoted Supreme Court Decision,
oppositors-movants only hold the property in trust for the rightful owners of the
land and are not the owners of subject landholding who should be notified of the
exemption application of applicant Roxas & Company, Incorporated.
Finally, this Office finds no substantial basis to reverse the assailed Orders since
there is substantial compliance by the applicant with the requirements for the
issuance of exemption clearance under DAR AO 6 (1994).[37]
On DAMBA-NSFWs petition for certiorari, the Court of Appeals, noting that the
petition was belatedly filed, sustained, by Decision of December 20, 1994 and
Resolution of May 7, 2007,[38] the DAR Secretarys finding that Roxas & Co. had
substantially complied with the prerequisites of DAR AO 6, Series of 1994. Hence,
DAMBA-NFSWs petition in G.R. No. 167505.
The Court finds no reversible error in the Court of Appeals assailed issuances, the
orders of the DAR Secretary which it sustained being amply supported by evidence.
IV. THE CLOAs ISSUED BY THE DAR in ADMINISTRATIVE CASE NO. A-
9999-008-98 SUBJECT OF G.R. No. 179650 TO THE FARMER-
BENEFICIARIES INVOLVING THE NINE PARCELS OF LAND IN
HACIENDA PALICO MUST BE CANCELLED.
Turning now to the validity of the issuance of CLOAs in Hacienda Palico vis--vis
the present dispositions: It bears recalling that in DAR Administrative Case Nos. A-
9999-008-98 and A-9999-142-97 (G.R. No. 179650), the Court ruled for Roxas &
Co.s grant of exemption in DAR Administrative Case No. A-9999-008-98 but
denied the grant of exemption in DAR Administrative Case No. A-9999-142-97 for
reasons already discussed. It follows that the CLOAs issued to the farmer-
beneficiaries in DAR Administrative Case No. A-9999-008-98 must be cancelled.
But first, the Court digresses. The assertion of DAMBA-NSFW that the petitions
for partial and complete cancellations of the CLOAs subject of DARAB Case Nos.
R-401-003-2001 to R-401-005-2001 and No. 401-239-2001 violated the earlier
order in Roxas v. Court of Appeals does not lie. Nowhere did the Court therein
pronounce that the CLOAs issued cannot and should not be cancelled, what was
involved therein being the legality of the acquisition proceedings. The Court merely
reiterated that it is the DAR which has primary jurisdiction to rule on the validity of
CLOAs. Thus it held:
. . . [t]he failure of respondent DAR to comply with the requisites of due process in
the acquisition proceedings does not give this Court the power to nullify the
[CLOAs] already issued to the farmer-beneficiaries. To assume the power is to
short-circuit the administrative process, which has yet to run its regular course.
Respondent DAR must be given the chance to correct its procedural lapses in the
acquisition proceedings. x x x x. Anyhow, the farmer beneficiaries hold the property
in trust for the rightful owner of the land.[39]
On the procedural question raised by Roxas & Co. on the appellate courts
relaxation of the rules by giving due course to DAMBA-NFSWs appeal in CA G.R.
SP No. 72198, the subject of G.R. No. 167845:
Indeed, the perfection of an appeal within the statutory period is jurisdictional and
failure to do so renders the assailed decision final and executory.[40] A relaxation of
the rules may, however, for meritorious reasons, be allowed in the interest of
justice.[41] The Court finds that in giving due course to DAMBA-NSFWs appeal, 2) The Court accordingly GRANTS the Motion for Reconsideration of the
the appellate court committed no reversible error. Consider its ratiocination: Department of Agrarian Reform in G.R. No. 167543 and REVERSES and SETS
ASIDE its Resolution of July 20, 2005;
x x x x. To deny [DAMBA-NSFW]s appeal with the PARAD will not only affect
their right over the parcel of land subject of this petition with an area of 103.1436 3) In G.R. No. 149548, the Court DENIES the petition for review of Roxas & Co.
hectares, but also that of the whole area covered by CLOA No. 6654 since the for lack of merit;
PARAD rendered a Joint Resolution of the Motion for Reconsideration filed by the
[DAMBA-NSFW] with regard to [Roxas & Co.]s application for partial and total
cancellation of the CLOA in DARAB Cases No. R-401-003-2001 to R-401-005-
2001 and No. 401-239-2001. There is a pressing need for an extensive discussion of
4) In G.R. No. 179650, the Court GRANTS the petition for review of DAMBA-
the issues as raised by both parties as the matter of canceling CLOA No. 6654 is of
NSFW and REVERSES and SETS ASIDE the October 31, 2006 Decision and
utmost importance, involving as it does the probable displacement of hundreds of
August 16, 2007 Resolution of the Court of Appeals in CA-G.R. SP No. 82225;
farmer-beneficiaries and their families. x x x x (underscoring supplied)
5) In G.R. No. 167505, the Court DENIES the petition for review of DAMBA-
Unlike courts of justice, the DARAB, as a quasi-judicial body, is not bound to
NSFW and AFFIRMS the December 20, 2004 Decision and March 7, 2005
strictly observe rules of procedure and evidence. To strictly enforce rules on appeals
Resolution of the Court of Appeals in CA-G.R. SP No. 82226;
in this case would render to naught the Courts dispositions on the other issues in
these consolidated petitions.
6) In G.R. No. 167845, the Court DENIES Roxas & Co.s petition for review for
lack of merit and AFFIRMS the September 10, 2004 Decision and April 14, 2005
In the main, there is no logical recourse except to cancel the CLOAs issued for the
Resolution of the Court of Appeals;
nine parcels of land identified as Lot Nos. 20, 13, 37, 19-B, 45, 47, 49, 48-1 and 48-
2 which are portions of TCT No. 985 covering 45.9771 hectares in Hacienda Palico
(or those covered by DAR Administrative Case No. A-9999-008-98). As for the rest 7) In G.R. No. 169163, the Court SETS ASIDE the Decisions of the Provincial
of the CLOAs, they should be respected since Roxas & Co., as shown in the Agrarian Reform Adjudicator in DARAB Case No. 401-239-2001 ordering the
discussion in G.R. Nos. 167540, 167543 and 167505, failed to prove that the other cancellation of CLOA No. 6654 and DARAB Cases Nos. R-401-003-2001 to No.
lots in Hacienda Palico and the other two haciendas, aside from the above- R-401-005-2001 granting the partial cancellation of CLOA No. 6654. The CLOAs
mentioned nine lots, are CARP-exempt. issued for Lots No. 21 No. 24, No. 26, No. 31, No. 32 and No. 34 or those covered
by DAR Administrative Case No. A-9999-142-97) remain; and
Conformably, Republic Act No. 3844 (R.A. No. 3844), as amended,[42] mandates
that disturbance compensation be given to tenants of parcels of land upon finding 8) Roxas & Co. is ORDERED to pay the disturbance compensation of affected
that (t)he landholding is declared by the department head upon recommendation of farmer-beneficiaries in the areas covered by the nine parcels of lands in DAR
the National Planning Commission to be suited for residential, commercial, Administrative Case No. A-9999-008-98 before the CLOAs therein can be
industrial or some other urban purposes.[43] In addition, DAR AO No. 6, Series of cancelled, and is ENJOINED to strictly follow the mandate of R.A. No. 3844.
1994 directs the payment of disturbance compensation before the application for
exemption may be completely granted. No pronouncement as to costs.
Roxas & Co. is thus mandated to first satisfy the disturbance compensation of SO ORDERED.
affected farmer-beneficiaries in the areas covered by the nine parcels of lands in
DAR AO No. A-9999-008-98 before the CLOAs covering them can be cancelled. CONCHITA CARPIO MORALES
And it is enjoined to strictly follow the instructions of R.A. No. 3844.
Associate Justice
Finally then, and in view of the Courts dispositions in G.R. Nos. 179650 and
167505, the May 27, 2001 Decision of the Provincial Agrarian Reform Adjudicator WE CONCUR:
(PARAD)[44] in DARAB Case No. 401-239-2001 ordering the total cancellation of
CLOA No. 6654, subject of G.R. No. 169163, is SET ASIDE except with respect to REYNATO S. PUNO
the CLOAs issued for Lot Nos. 20, 13, 37, 19-B, 45, 47, 49, 48-1 and 48-2 which
are portions of TCT No. 985 covering 45.9771 hectares in Hacienda Palico (or Chief Justice
those covered by DAR Administrative Case No. A-9999-008-98). It goes without
saying that the motion for reconsideration of DAMBA-NFSW is granted to thus ANTONIO T. CARPIO
vacate the Courts October 19, 2005 Resolution dismissing DAMBA-NFSWs
petition for review of the appellate courts Decision in CA-G.R. SP No. 75952;[45] Associate Justice
WHEREFORE, RENATO C. CORONA
1) In G.R. No. 167540, the Court REVERSES and SETS ASIDE the November 24, Associate Justice
2003 Decision[46] and March 18, 2005 Resolution of the Court of Appeals in CA-
G.R. SP No. 72131 which declared that Presidential Proclamation No. 1520 MINITA V. CHICO-NAZARIO
reclassified the lands in the municipalities of Nasugbu in Batangas and Maragondon
and Ternate in Cavite to non-agricultural use; Associate Justice
ANTONIO EDUARDO B. NACHURA [2] Id. at 744-745.
Associate Justice [3] GUIDELINES FOR THE ISSUANCE OF EXEMPTION CLEARANCES
BASED ON SECTION 3(c) OF RA 6657 AND THE DEPARTMENT OF JUSTICE
(DOJ) OPINION NO. 44, SERIES OF 1990.
[4] Rollo (G.R. No. 167540), pp. 1280-1281.
[5] Resolutions of February 22, 2006; October 22, 2006; and February 4, 2009.
[6] Vide Evangelista v. Santiago, G.R. No. 157447, 457 SCRA 744 (2005).
[7] G.R. No. 147479, September 26, 2005, 471 SCRA 74.
i) So much as may be necessary of that portion of Tubalan Cove, Malita in the
Province of Davao del Sur;
j) So much as may be necessary of that portion of Baler, Dinalungan and Casiguran
including its territorial waters and islets and its immediate environs in the Province
of Aurora;
k) So much as may be necessary of that portion of cities of Naga and Iriga in the
Province of Camarines Sur, Legaspi and Tabaco in the Province of Albay, and
Sorsogon in the Province of Sorsogon;
l) So much as may be necessary of that portion of Bataan Island in the province of
Batanes;

PRESBITERO J. VELASCO, JR. m) So much as may be necessary of that portion of Lapu-lapu in the Island of
[8] Id. at 92.
Mactan, and the municipalities of Balamban and Pinamungahan and the cities of
Associate Justice Cebu and Toledo and the Province of Cebu, including its territorial waters and islets
[9] Supra note 2.
and its immediate environs;
TERESITA J. LEONARDO-DE CASTRO [10] Id. at 783.
n) So much as may be necessary of that portion of Tacloban City;
Associate Justice [11] Ibid.
o) So much as may be necessary of that portion of the Municipality of Barugo in the
ARTURO D. BRION Province of Leyte;
[12] CLARIFICATORY GUIDELINES ON THE EFFECT OF DECLARATIONS
OF GENERAL AREAS IN THE COUNTRY AS TOURIST ZONES TO THE
Associate Justice COVERAGE OF LANDS DEVOTED TO OR SUITABLE FOR AGRICULTURE p) So much as may be necessary of that portion of the Municipality of Buenavista
WITHIN SAID AREAS UNDER THE [CARP]. Issued on March 29, 2004 by then in the Province of Guimaras;
LUCAS P. BERSAMIN Acting Secretary Jose Mari B. Ponce.
q) So much as may be necessary of that portion of the municipalities of San Jose de
Associate Justice [13] Proclamation Nos. 1653, 1801, 2052 and 2067. Buenavista, Hamtic, Sibalom, and Culasi in the Province of Antique;

DIOSDADO M. PERALTA [14] Republic Act No. 7916. r) So much as may be necessary of that portion of the municipalities of Catarman,
Bobon and San Jose in the Province of Northern Samar, the Island of Samar;
Associate Justice [15] SECTION 5. Establishment of ECOZONES. - To ensure the viability and
geographic dispersal of ECOZONES through a system of prioritization, the s) So much as may be necessary of that portion of the Municipality of Ternate and
MARIANO C. DEL CASTILLO following areas are initially identified as ECOZONES, subject to the criteria its immediate environs in the Province of Cavite;
specified in Section 6:
Associate Justice t) So much as may be necessary of that portion of Polloc, Parang in the Province of
a) So much as may be necessary of that portion of Morong, Hermosa, Dinalupihan, Maguindanao;
ROBERTO A. ABAD Orani, Samal, and Abucay in the Province of Bataan;
u) So much as may be necessary of that portion of the Municipality of Boac in the
Associate Justice b) So much as may be necessary of that portion of the municipalities of Ibaan, Province of Marinduque;
Rosario, Taysan, San Jose, San Juan, and cities of Lipa and Batangas;
MARTIN S. VILLARAMA, JR. v) So much as may be necessary of that portion of the Municipality of Pitogo in the
c) So much as may be necessary of that portion of the City of Cagayan de Oro in Province of Zamboanga del Sur;
Associate Justice the Province of Misamis Oriental;
w) So much as may be necessary of that portion of Dipolog City-Manukan Corridor
CERTIFICATION d) So much as may be necessary of that portion of the City of Iligan in the Province in the Province of Zamboanga del Norte;
of Lanao del Norte;
Pursuant to Section 13, Article VIII of the Constitution, I hereby certify that the x) So much as may be necessary of that portion of Mambajao, Camiguin Province;
conclusions in the above Decision had been reached in consultation before the case e) So much as may be necessary of that portion of the Province of Saranggani;
was assigned to the writer of the opinion of the Court. y) So much as may be necessary of that portion of Infanta, Real, Polillo, Alabat,
f)So much as may be necessary of that portion of the City of Laoag in the Province Atimonan, Mauban, Tiaong, Pagbilao, Mulanay, Tagkawayan, and Dingalan Bay in
REYNATO S. PUNO of Ilocos Norte; the Province of Quezon;

Chief Justice g) So much as may be necessary of that portion of Davao City and Samal Island in z) So much as may be necessary of that portion of Butuan City and the Province of
the Province of Ilocos Norte; Agusan del Norte, including its territorial waters and islets and its immediate
* Now the Department of Land Reform. environs;
h) So much as may be necessary of that portion of Oroquieta City in the Province of
[1] G.R. No. 127876, 378 Phil. 727 (1999). Misamis Occidental;
aa) So much as may be necessary of that portion of Roxas City including its
territorial waters and islets and its immediate environs in the Province of Capiz;
bb) So much as may be necessary of that portion of San Jacinto, San Fabian,
Mangaldan, Lingayen, Sual, Dagupan, Alaminos, Manaoag, Binmaley in the
Province of Pangasinan;
cc) So much as may be necessary of that portion of the autonomous region;
dd) So much as may be necessary of that portion of Masinloc, Candelaria and Sta.
Cruz in the Province of Zambales;
ee) So much as may be necessary of that portion of the Palawan Island;
ff) So much as may be necessary of that portion of General Santos City in South
Cotabato and its immediate environs;
gg) So much as may be necessary of that portion of Dumaguete City and Negros
Oriental, including its territorial waters and islets and its immediate environs.
hh) So much as may be necessary of that portion of the Province of Ilocos Sur;
ii) So much as may be necessary of that portion of the Province of La Union;
jj) So much as may be necessary of that portion of the Province of Laguna,
including its territorial waters and its immediate environs;
kk) So much as may be necessary of that portion of the Province of Rizal;
[16] Land Conversion. - Agricultural lands may be converted for residential,
commercial, industrial and other non-agricultural purposes, subject to the
conditions set forth under Republic Act. No.. 6657 and other existing laws.
[17] TENANT EMANCIPATION DECREE OF 1972.
[18] On September 26, 1972.
[19] On August 3, 2007.
[20] Section 2(k) of DAR Administrative Order No. 01-99, Revised Rules and
Regulations on the Conversion of Agricultural Lands to Non-Agricultural Uses.
[21] Republic Act No. 9593.
[22] SEC. 61. Development Planning. x x x x.
x x x x.
No [Tourism Enterprise Zone] shall be designated without a development plan duly
approved by the [Tourism Infrastructure and Enterprise Zone Authority] and
without the approval, by resolution, of the [local government unit] concerned. Any
deviation or modification from the development plan shall require the prior
authorization of the TIEZA. The TIEZA may cause the suspension of granted
incentives and withdrawal of recognition as a TEZ Operator. It may likewise
impose reasonable fines and penalties upon TEZ Operators and responsible persons
for any failure to properly implement the approved development plan.
Lands identified as part of a TEZ shall qualify for exemption from the coverage of
Republic Act No. 7279, otherwise known as the Urban Development and Housing
Act of 1992, and Republic Act No. 6657, otherwise known as the Comprehensive
Agrarian Reform Law, subject to rules and regulations to be crafted by the TIEZA,
the Housing and Urban Development Coordinating Council and the Department of
Agrarian Reform.
[23] Vide: Pasong Bayabas Farmers Association v. CA, G.R. No. 142359, May 25,
2004; and Junio v. Garilao, G.R. No. 147146, July 29, 2005.
[24] G.R. No. 168394, October 6, 2008, 567 SCRA 540.
[25] Id. at 553-554.
[26] Then Secretary Horacio R. Morales, Jr.
[27] CA rollo (CA G.R. No. 63146 as part of G.R. No. 149548), pp. 9-11.
[28] Id. (CA G.R. No. 63146 as part of G.R. No. 149548) at 12-17.
[29] Id. (CA G.R. No. 63146 as part of G.R. No. 149548) at 345-347.
[30] Then Secretary Hernani Braganza.
[31] The DAR Secretary ruled that:
In the case at hand Records show that subject properties were originally registered
under TCT No. T-985. This is shown in the Certification dated 17 June 1998 issued
by Alexander Bonuan, Deputy Register of Deeds II, Registry of Deeds, Nasugbu,
Batangas. x x x x.
CERTIFICATION
x x x x.
This is to certify that Lot No. 125 of Psd-04016141 (OLT) under TCT No. 49946 is
a transfer from TCT-985. Further, it is certified that Lot 125-N Psd-04-046912
under TCT No. 60034 is a transfer from TCT No. T-49946.
x x x x.
In a letter dated 18 July 2000 addressed to Director Ricardo R. San Andres, Head,
Center for Land Use, Policy, Planning and Implementation (CLUPPI)-2 Secretariat,
Deputy Register of Deeds Bonuan clarified that TCT No. 49946 should read TCT
No. 59946. Attached to said letter is a certified true copy of TCT No. T-59946. A
scrutiny of TCT No. T-59946 shows that it covers a parcel of land identified as Lot
No. 125 of the subdivision plan Psd-04-016144 with an area of 947.8417 hectares
situated in Barangays Bilaran, Lumbangan, Cogonan, and Reparo, Nasugbu,
Batangas.
x x x x.
A scrutiny of TCT Nos. T-60019, T-60020, T-60021, T-60022, T-60023 and T-60034
shows that they are transfers from TCT No. T-59946. Furthermore, a Certification
dated 6 September 2001 issued by Dante Ramirez, Deputy Register of Deeds,
Nasugbu, Batangas, states that the mother title of TCT Nos. T-60019, T-60020, T-
60021, T-60022, T-60023 and T-60034 is TCT No. T-985. registered in the name of
Roxas Y Cia.
x x x x.
In the case at hand, the Certification dated 19 September 1996 issued by Reynaldo
H. Garcia, Zoning Administrator of Nasugbu, Batangas states, among others, that
Lots Nos. 31, 24, 21, 32, 28 and 34 situated in Barangays Cogunan and
Lumbangan, Nasugbu, Batangas, are within the Industrial Zone. Moreover, a
Certification also dated 19 September 1996 issued by Zoning Administrator
Reynaldo H. Garcia states that DAR Lot No. 36 with an area of 0.6273 hectares
situated in Brgy. Lumbanga, Nasugbu, Batangas, is within the industrial
zoneMoreover, a Certification dated 7 January 1998 issued by Maria Luisa G.
Pangan, under authority of the HLURB Secretariat, states that Resolution No. 28,
Municipal Ordinance No. 4 of the Sangguniang Bayan of Nasugbu, Batangas, dated
18 April 1982, was approved by the HSRC, now HLURB, under Resolution No. R-
123, Series of 1983, dated 4 May 1983. x x x x.
[32] Viva Footwear Manufacturing Corp. v. SEC, G.R. No. 163235, April 27, 2007,
522 SCRA 609, 615 citing Quiambao v. CA, G.R. No. 128305, March 28, 2005,
454 SCRA 17, 40.
[33] G.R. No. 147146, July 29, 2005, 465 SCRA 173.
[34] Id. at 187.
[35] Rollo (G.R. No. 167505), pp. 529-532.
[36] Id. at 533-534.
[37] Id. at 525-526.
[38] Id. at 91-93.
[39] Supra note 1 at 783.
[40] Sublay v. NLRC, 324 SCRA 188 (2000).
[41] Cuevas v. Bais Steel Corporation, G.R. No. 142689, October 17, 2002, 391
SCRA 192.
[42] AN ACT TO ORDAIN THE AGRICULTURAL LAND REFORM CODE
AND TO INSTITUTE LAND REFORMS IN THE PHILIPPINES, INCLUDING
THE ABOLITION OF TENANCY AND THE CHANNELING OF CAPITAL
INTO INDUSTRY, PROVIDE FOR THE NECESSARY IMPLEMENTING
AGENCIES, APPROPRIATE FUNDS THEREFOR AND FOR OTHER
PURPOSES. AS AMENDED BY REPUBLIC ACT NO. 6389.
[43] Section 36 (1) of R.A. No. 3844.
[44] PARAD Barbara P. Tan. In the Decision of May 27, 2001, the PARAD
disposed as follows:
WHEREFORE, premises considered, Judgment is hereby rendered:
1. Finding and declaring the issuance of CLOA 6654 not in accordance with the
mandate of Sec. 16, RA 6657 thereby effectively circumventing the implementation
of the CARP;

2. Finding CLOA 6654 to be fictitious/null and void having been generated on

the basis of a subdivision survey which was plotted on a survey plan which has
already been previously cancelled, superseded and extinct, accordingly;

3. Ordering the cancellation of CLOA 6654, as prayed for by Petitioner, without

prejudice, however, to the execution of the proper subdivision survey for purposes
of delineating accurately the boundaries of the properties subject of acquisition
proceedings for purposes of determining their coverage under the CARP or their
negotiability for conversion and/or exclusion from the Program.

[45] Penned by Justice Andres B. Reyes, Jr. with the concurrence of Justices Lucas
P. Bersamin and Celia C. Librea-Leagogo.

[46] Penned by Justice Jose L. Sabio, Jr. with the concurrence of Justices Amelita
G. Tolentino and Regalado E. Maambong and the dissent of Justices Ruben T.
Reyes (now a retired member of the Court) and Portia Alio-Hormachuelos.
 a) That said properties are all covered by conditional donations subject
to the prohibitions of the donors to SELL, EXCHANGE, LEASE,
TRANSFER, ENCUMBER OR MORTGAGE the properties;
b) That they are used for charitable and religious purposes;
c) That the parishes located in depressed areas badly need them for the
furtherance of their mission work, propagation of the faith, maintenance
Republic of the Philippines and support of their chapels, churches and educational religious
SUPREME COURT institutions like the Holy Rosary Major and Minor Seminaries for the
Manila promotion of the priesthood vocation;
SECOND DIVISION d) For the preservation of good relationship between church and state
thru non-infringement of the right to exercise religious profession and
G.R. No. 139285 December 21, 2007 worship;
ROMAN CATHOLIC ARCHBISHOP OF CACERES, Petitioner, e) For the maintenance of the Cathedral and Peafrancia Shrine, which
vs. now include the Basilica Minore Housing our venerable image of Our
SECRETARY OF AGRARIAN REFORM and DAR REGIONAL DIRECTOR Lady of Peafrancia and the venerable portrait of Divine Rostro;
(Region V), Respondents.
f) That the petitioner (church) is amenable to continue the leasehold
DECISION system with the present cultivators or tenants.4
VELASCO, JR., J.: This appeal was denied by then DAR Secretary Ernesto D. Garilao in an Order
dated December 8, 1997.5 A subsequent motion for reconsideration was denied in
an Order dated June 10, 1998.6
The Comprehensive Agrarian Reform Law (CARL) has truly noble goals, and these
noble goals should not be stymied by the creation of exemptions or exceptions not
contemplated by the law. The matter was then raised to the CA via Petition for Review on Certiorari.
Archbishop argued that even if the lands in question are registered in his name, he
holds the lands in trust for the benefit of his followers as cestui que trust.
The Case
Archbishop further argued that the deeds of donation by which the lands were
transferred to him imposed numerous fiduciary obligations, such that he cannot sell,
In this Petition for Review on Certiorari under Rule 45, petitioner Roman Catholic exchange, lease, transfer, encumber, or mortgage the subject lands. By this
Archbishop of Caceres (Archbishop) questions the February 4, 1999 Decision 1 of reasoning, Archbishop concluded that he is not the "landowner" contemplated by
the Court of Appeals (CA) in CA-G.R. SP No. 48282, which upheld the December PD 27 and Republic Act No. (RA) 6657, the CARL of 1988. He then prayed that
8, 1997 and June 10, 1998 Orders of the Department of Agrarian Reform (DAR). the assailed orders of the DAR be reversed, or in the alternative, that the alleged
beneficiaries of the trust be each allowed to exercise rights of retention over the
landholdings.7
The Facts
The petition was dismissed by the CA in its February 4, 1999
Archbishop is the registered owner of several properties in Camarines Sur, with a
Decision.8 Archbishop filed a motion for reconsideration, but was denied in the
total area of 268.5668 hectares. Of that land, 249.0236 hectares are planted with
June 18, 1999 CA Resolution.9
rice and corn, while the remaining 19.5432 hectares are planted with coconut trees.
Archbishop now brings the matter before us through this petition.
In 1985, Archbishop filed with the Municipal Agrarian Reform District Office No.
19, Naga City, Camarines Sur several petitions for exemption of certain properties
located in various towns of Camarines Sur from the coverage of Operation Land The Issues
Transfer (OLT) under Presidential Decree No. (PD) 27. 2 Two of these petitions were
denied in an Order dated November 6, 1986, issued by the Regional Director of Archbishop raises issues he had raised previously, which, he contends, the CA
DAR, Region V, Juanito L. Lorena.3 failed to properly address. He claims that the CA erred in holding that he is only
entitled to assert one right of retention as the subject properties are registered in his
Archbishop appealed from the order of the Regional Director, and sought name. He further claims that an express trust had been created wherein he only held
exemption from OLT coverage of all lands planted with rice and corn which were naked title to the subject properties on behalf of the beneficiaries. He argues that it
registered in the name of the Roman Catholic Archdiocese of Caceres. In his appeal, is not the "landowner" contemplated by the law, but merely a trustee, and as such is
Archbishop cited the following grounds: entitled to as many rights of retention on behalf of the beneficiaries of each
particular property. He then raises the question of the applicability of the ruling in
The Roman Catholic Apostolic Administrator of Davao, Inc. v. The Land
Registration Commission and the Register of Deeds of Davao City, 10 which, he
cites, ruled that properties held by the Church are held by it as a mere administrator
for the benefit of the members of that particular religion. As Archbishop claims to
be merely an administrator of the subject properties, he argues that these subject
properties should have been exempt from the OLT.
The Courts Ruling
The petition has no merit.
Archbishops arguments, while novel, must fail in the face of the law and the
dictates of the 1987 Constitution.
The laws simply speak of the "landowner" without qualification as to under what
title the land is held or what rights to the land the landowner may exercise. There is
no distinction made whether the landowner holds "naked title" only or can exercise
all the rights of ownership. Archbishop would have us read deeper into the law, to
create exceptions that are not stated in PD 27 and RA 6657, and to do so would be
to frustrate the revolutionary intent of the law, which is the redistribution of
agricultural land for the benefit of landless farmers and farmworkers.
Archbishop was found to be the registered owner of the lands in question, and does
not contest that fact. For the purposes of the law, this makes him the landowner,
without the necessity of going beyond the registered titles. He cannot demand a
deeper examination of the registered titles and demand further that the intent of the
original owners be ascertained and followed. To adopt his reasoning would create
means of sidestepping the law, wherein the mere act of donation places lands
beyond the reach of agrarian reform.
There can be no claim of more than one right of retention per landowner. Neither
PD 27 nor RA 6657 has a provision for a landowner to exercise more than one right
of retention. The law is simple and clear as to the retention limits per landowner. PD
27 states, "In all cases, the landowner may retain an area of not more than seven (7)
hectares if such landowner is cultivating such area or will now cultivate it"; while
RA 6657 states:
SEC. 6. Retention Limits.Except as otherwise provided in this Act, no person may
own or retain, directly, any public or private agricultural land, the size of which
shall vary according to factors governing a viable family-sized farm, such as
commodity produced, terrain, infrastructure, and soil fertility as determined by the
Presidential Agrarian Reform Council (PARC) created hereunder, but in no case
shall the retention by the landowner exceed 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: Provided, That landowners
whose lands have been covered by Presidential Decree No. 27 shall be allowed to
keep the area originally retained by them thereunder; Provided, further, That
original homestead grantees or 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.
Nothing in either law supports Archbishops claim to more than one right of
retention on behalf of each cestui que trust. The provisions of PD 27 and RA 6657
are plain and require no further interpretationthere is only one right of retention
per landowner, and no multiple rights of retention can be held by a single party.
Furthermore, the scheme proposed by Archbishop would create as many rights of
retention as there are beneficiaries, which could in effect protect the entire available
land area from agrarian reform. Under Archbishops reasoning, there is not even a
definite landowner to claim separate rights of retention, and no specific number of
rights of retention to be claimed by the landowners. There is simply no basis in the
law or jurisprudence for his argument that it is the "beneficial ownership" that
should be used to determine which party would have the right of retention.
Archbishop makes much of the conditional donation, that he does not have the
power to sell, exchange, lease, transfer, encumber or mortgage the transferred
properties. He claims that these conditions do not make him the landowner as
contemplated by the law. This matter has already been answered in Hospicio de San
Jose de Barili, Cebu City (Hospicio) v. Department of Agrarian Reform. 11 In that
case, wherein Act No. 3239 prohibited the sale under any consideration of lands
donated to the Hospicio, a charitable organization, the Court found that the lands of
the Hospicio were not exempt from the coverage of agrarian reform. In
characterizing the sale of land under agrarian reform, we stated:
Generally, sale arises out of contractual obligation. Thus, it must meet the first
essential requisite of every contract that is the presence of consent. Consent implies
an act of volition in entering into the agreement. The absence or vitiation of consent
renders the sale either void or voidable.
In this case, the deprivation of the Hospicios property did not arise as a
consequence of the Hospicios consent to the transfer. There was no meeting of
minds between the Hospicio, on one hand, and the DAR or the tenants, on the other,
on the properties and the cause which are to constitute the contract that is to serve
ultimately as the basis for the transfer of ownership of the subject lands. Instead, the
obligation to transfer arises by compulsion of law, particularly P.D. No. 27.12
We discussed further:
The twin process of expropriation under agrarian reform and the payment of just
compensation is akin to a forced sale, which has been aptly described in common
law jurisdictions as "sale made under the process of the court and in the mode
prescribed by law," and "which is not the voluntary act of the owner, such as to
satisfy a debt, whether of a mortgage, judgment, tax lien, etc." The term has not
been precisely defined in this jurisdiction, but reference to the phrase itself is made
in Articles 223, 242, 237 and 243 of the Civil Code, which uniformly exempt the
family home "from execution, forced sale, or attachment." Yet a forced sale is
clearly different from the sales described under Book V of the Civil Code which are
conventional sales, as it does not arise from the consensual agreement of the vendor
and vendee, but by compulsion of law. Still, since law is recognized as one of the
sources of obligation, there can be no dispute on the efficacy of a forced sale, so
long as it is authorized by law.13
Archbishops claim that he does not have jus disponendi over the subject properties
is unavailing. The very nature of the compulsory sale under PD 27 and RA 6657
defeats such a claim. Other less scrupulous parties may even attempt creating trusts
to prevent their lands from coming under agrarian reform, and say that the trustee
has no power to dispose of the properties. The disposition under PD 27 and RA
6657 is of a different character than what is contemplated by jus disponendi,
wherein under these laws, voluntariness is not an issue, and the disposition is
necessary for the laws to be effective.
Under PD 27 and RA 6657, Archbishop cannot claim that the alleged conditions of
the donations would have primacy over the application of the law. This forced sale
is not even a violation of the conditions of the donation, since it is by application of developed, shall be exempt from the coverage of this Act. (As amended
law and beyond Archbishops control. The application of the law cannot and should by R. A. 7881)
not be defeated by the conditions laid down by the donors of the land. If such were
allowed, it would be a simple matter for other landowners to place their lands
Archbishop would claim exemption from the coverage of agrarian reform by stating
without limit under the protection of religious organizations or create trusts by the
that he is a mere administrator, but his position does not appear under the list of
mere act of donation, rendering agrarian reform but a pipe dream.
exemptions under RA 6657. His claimed status as administrator does not create
another class of lands exempt from the coverage of PD 27 or RA 6657, and The
Archbishops contention that he is merely an administrator of the donated properties Roman Catholic Apostolic Administrator of Davao, Inc.14 does not create another
will not serve to remove these lands from the coverage of agrarian reform. Under definition for the term "landowner."
PD 27, the coverage is lands devoted to rice and corn. Section 4 of RA 6657 states,
"The Comprehensive Agrarian Reform Law of 1988 shall cover, regardless of
We explained in Hospicio:
tenurial arrangement and commodity produced, all public and private agricultural
lands as provided in Proclamation No. 131 and Executive Order No. 229, including
other lands of the public domain suitable for agriculture." The lands in Archbishops It is axiomatic that where a general rule is established by a statute with exceptions,
name are agricultural lands that fall within the scope of the law, and do not fall the Court will not curtail nor add to the latter by implication, and it is a rule that an
under the exemptions. express exception excludes all others. We cannot simply impute into a statute an
exception which the Congress did not incorporate. Moreover general welfare
legislation such as land reform laws is to be construed in favor of the promotion of
The exemptions under RA 6657 form an exclusive list, as follows:
social justice to ensure the well-being and economic security of the people. Since a
broad construction of the provision listing the properties exempted under the CARL
SEC. 10. Exemptions and Exclusions. would tend to denigrate the aims of agrarian reform, a strict application of these
exceptions is in order.15
(a) Lands actually, directly and exclusively used for parks, wildlife,
forest reserves, reforestation, fish sanctuaries and breeding grounds, Archbishop cannot claim exemption in behalf of the millions of Filipino faithful, as
watersheds and mangroves shall be exempt from the coverage of this the lands are clearly not exempt under the law. He should not fear that his followers
Act. are simply being deprived of land, as under both PD 27 and RA 6657, he is entitled
to just compensation, which he may then use for the benefit of his followers. His
situation is no different from other landowners affected by agrarian reformthey
(b) Private lands actually, directly and exclusively used for prawn farms
are somewhat deprived of their land, but it is all for a greater good.
and fishponds shall be exempt from the coverage of this
Act: Provided, That said prawn farms and fishponds have not been
distributed and Certificate of Land Ownership Award (CLOA) issued As Association of Small Landowners in the Philippines, Inc. v. Secretary of
under the Agrarian Reform Program. Agrarian Reform16 recognized the revolutionary character of the expropriation
under the agrarian reform law, we follow such lofty ideal for the resolution of this
case. This grand purpose under the CARL must not be hindered by the simple
In cases where the fishponds or prawn farms have been subjected to the
expedient of appending conditions to a donation of land, or by donating land to a
Comprehensive Agrarian Reform Law, by voluntary offer to sell, or
church. This is not to cast aspersions on religious organizations, but it is not fitting
commercial farms deferment or notices of compulsory acquisition, a
for them to be used as vehicles for keeping land out of the hands of the landless.
simple and absolute majority of the actual regular workers or tenants
The law is indubitably in line with the charitable ideals of religious organizations to
must consent to the exemption within one (1) year from the effectivity of
ensure that the land they own falls into the hands of able caretakers and owners. As
this Act. When the workers or tenants do not agree to this exemption, the
a religious leader, Archbishop can take solace in the fact that his lands are going to
fishponds or prawn farms shall be distributed collectively to the worker-
be awarded to those who need and can utilize them to the fullest.
beneficiaries or tenants who shall form cooperative or association to
manage the same.
WHEREFORE, we DENY the petition, and AFFIRM the February 4, 1999
Decision in CA-G.R. SP No. 48282.
In cases where the fishponds or prawn farms have not been subjected to
the Comprehensive Agrarian Reform Law, the consent of the
farmworkers shall no longer be necessary; however, the provision of SO ORDERED.
Section 32-A hereof on incentives shall apply.
PRESBITERO J. VELASCO, JR.
(c) Lands actually, directly and exclusively used and found to be Associate Justice
necessary for national defense, school sites and campuses, including
experimental farm stations operated by public or private schools for
WE CONCUR:
educational purposes, seeds and seedlings research and pilot production
center, church sites and convents appurtenant thereto, mosque sites and
Islamic centers appurtenant thereto, communal burial grounds and LEONARDO A. QUISUMBING
cemeteries, penal colonies and penal farms actually worked by the Associate Justice
inmates, government and private research and quarantine centers and all Chairperson
lands with eighteen percent (18%) slope and over, except those already
 12
ANTONIO T. CARPIO CONCHITA CARPIO MORALES Id. at 616.
Associate Justice Associate Justice
13
Id. at 618.
DANTE O. TINGA
Associate Justice 14
Supra note 10.

AT T E S T AT I O N 15
Supra note 11, at 622.

I attest that the conclusions in the above Decision had been reached in consultation 16
G.R. No. 78742, July 14, 1989, 175 SCRA 343.
before the case was assigned to the writer of the opinion of the Courts Division.

LEONARDO A. QUISUMBING
Associate Justice
Chairperson

C E R T I F I C AT I O N

Pursuant to Section 13, Article VIII of the Constitution, and the Division Acting
Chairpersons Attestation, I certify that the conclusions in the above Decision had
been reached in consultation before the case was assigned to the writer of the
opinion of the Courts Division.

REYNATO S. PUNO
Chief Justice

Footnotes

1
Penned by Associate Justice Oswaldo D. Agcaoili and concurred in by
Associate Justices Corona Ibay-Somera and Teodoro P. Regino.

2
"Decreeing the Emancipation of Tenants from the Bondage of the Soil,
Transferring to Them the Ownership of the Land They Till and
Providing the Instruments and Mechanism Therefor" (1972).

3
Rollo, p. 87.

4
Id. at 95-96

5
Id. at 87-101.

6
Id. at 102-105.

7
Id. at 38.

8
Id. at 37-42.

9
Id. at 44.

10
102 Phil 596 (1957).

11
G.R. No. 140847, September 23, 2005, 470 SCRA 609.
 agricultural crops, soil testing and tissue culture laboratory issued to restrain the trial court from enforcing the writ of possession, and thereafter
centers, 15 small scale technology soap making, small scale to issue a writ of injunction.
products of plaster of paris, marine biological and sea
farming research center,and other progressive feasibility In its answer to the petition, the Province of Camarines Sur claimed that it has the
concepts objective of which is to provide the necessary authority to initiate the expropriation proceedings under Sections 4 and 7 of Local
scientific and technology know-how to farmers and Government Code (B.P. Blg. 337) and that the expropriations are for a public
Republic of the Philippines
fishermen in Camarines Sur and to establish a housing purpose.
SUPREME COURT
project for provincial government employees;
Manila
Asked by the Court of Appeals to give his Comment to the petition, the Solicitor
WHEREAS, the province would need additional land to be General stated that under Section 9 of the Local Government Code (B.P. Blg. 337),
FIRST DIVISION
acquired either by purchase or expropriation to implement there was no need for the approval by the Office of the President of the exercise by
the above program component; the Sangguniang Panlalawigan of the right of eminent domain. However, the
Solicitor General expressed the view that the Province of Camarines Sur must first
WHEREAS, there are contiguous/adjacent properties to be secure the approval of the Department of Agrarian Reform of the plan to
G.R. No. 103125 May 17, 1993 (sic) present Provincial Capitol Site ideally suitable to expropriate the lands of petitioners for use as a housing project.
establish the same pilot development center;
PROVINCE OF CAMARINES SUR, represented by GOV. LUIS R. The Court of Appeals set aside the order of the trial court, allowing the Province of
VILLAFUERTE and HON. BENJAMIN V. PANGA as Presiding Judge of WHEREFORE . . . . Camarines Sur to take possession of private respondents' lands and the order
RTC Branch 33 at Pili, Camarines Sur, petitioners, denying the admission of the amended motion to dismiss. It also ordered the trial
vs. court to suspend the expropriation proceedings until after the Province of
Pursuant to the Resolution, the Province of Camarines Sur, through its Governor,
THE COURT OF APPEALS (THIRD DIVISION), ERNESTO SAN Camarines Sur shall have submitted the requisite approval of the Department of
Hon. Luis R.Villafuerte, filed two separate cases for expropriation against Ernesto
JOAQUIN and EFREN SAN JOAQUIN, respondents. Agrarian Reform to convert the classification of the property of the private
N. San Joaquin and Efren N. San Joaquin, docketed as Special Civil Action Nos. P-
17-89 and P-19-89 of the Regional Trial Court, Pili, Camarines Sur, presided by the respondents from agricultural to non-agricultural land.
The Provincial Attorney for petitioners. Hon. Benjamin V. Panga.
Hence this petition.
Reynaldo L. Herrera for Ernesto San Joaquin. Forthwith, the Province of Camarines Sur filed a motion for the issuance of writ of
possession. The San Joaquins failed to appear at the hearing of the motion. It must be noted that in the Court of Appeals, the San Joaquins asked for: (i) the
dismissal of the complaints for expropriation on the ground of the inadequacy of the
The San Joaquins moved to dismiss the complaints on the ground of inadequacy of compensation offered for the property and (ii) the nullification of Resolution No.
the price offered for their property. In an order dated December 6, 1989, the trial 129, Series of 1988 of the Sangguniang Panlalawigan of the Province of Camarines
QUIASON, J.:
court denied the motion to dismiss and authorized the Province of Camarines Sur to Sur.
take possession of the property upon the deposit with the Clerk of Court of the
In this appeal by certiorari from the decision of the Court of Appeals in AC-G.R.
amount of P5,714.00, the amount provisionally fixed by the trial court to answer for The Court of Appeals did not rule on the validity of the questioned resolution;
SP No. 20551 entitled "Ernesto N. San Joaquin, et al., v. Hon. Benjamin V. Panga,
damages that private respondents may suffer in the event that the expropriation neither did it dismiss the complaints. However, when the Court of Appeals ordered
et al.," this Court is asked to decide whether the expropriation of agricultural lands
cases do not prosper. The trial court issued a writ of possession in an order dated the suspension of the proceedings until the Province of Camarines Sur shall have
by local government units is subject, to the prior approval of the Secretary of the
January18, 1990. obtained the authority of the Department of Agrarian Reform to change the
Agrarian Reform, as the implementator of the agrarian reform program.
classification of the lands sought to be expropriated from agricultural to non-
The San Joaquins filed a motion for relief from the order, authorizing the Province agricultural use, it assumed that the resolution is valid and that the expropriation is
On December 22, 1988, the Sangguniang Panlalawigan of the Province of for a public purpose or public use.
of Camarines Sur to take possession of their property and a motion to admit an
Camarines Sur passed Resolution No. 129, Series of 1988, authorizing the
amended motion to dismiss. Both motions were denied in the order dated February
Provincial Governor to purchase or expropriate property contiguous to the
1990. Modernly, there has been a shift from the literal to a broader interpretation of
provincial capitol site, in order to establish a pilot farm for non-food and non-
"public purpose" or "public use" for which the power of eminent domain may be
traditional agricultural crops and a housing project for provincial government
In their petition before the Court of Appeals, the San Joaquins asked: (a) that exercised. The old concept was that the condemned property must actually be used
employees.
Resolution No. 129, Series of 1988 of the Sangguniang Panlalawigan be declared by the general public (e.g. roads, bridges, public plazas, etc.) before the taking
null and void; (b) that the complaints for expropriation be dismissed; and (c) that thereof could satisfy the constitutional requirement of "public use". Under the new
The "WHEREAS" clause o:f the Resolution states: concept, "public use" means public advantage, convenience or benefit, which tends
the order dated December 6, 1989 (i) denying the motion to dismiss and (ii)
allowing the Province of Camarines Sur to take possession of the property subject to contribute to the general welfare and the prosperity of the whole community, like
WHEREAS, the province of Camarines Sur has adopted a of the expropriation and the order dated February 26, 1990, denying the motion to a resort complex for tourists or housing project (Heirs of Juancho Ardano v. Reyes,
five-year Comprehensive Development plan, some of the admit the amended motion to dismiss, be set aside. They also asked that an order be 125 SCRA 220 [1983]; Sumulong v. Guerrero, 154 SC.RA 461 [1987]).
vital components of which includes the establishment of
model and pilot farm for non-food and non-traditional
The expropriation of the property authorized by the questioned resolution is for a
public purpose. The establishment of a pilot development center would inure to the
direct benefit and advantage of the people of the Province of Camarines Sur. Once
operational, the center would make available to the community invaluable
information and technology on agriculture, fishery and the cottage industry.
Ultimately, the livelihood of the farmers, fishermen and craftsmen would be
enhanced. The housing project also satisfies the public purpose requirement of the
Constitution. As held in Sumulong v. Guerrero, 154 SCRA 461, "Housing is a basic
human need. Shortage in housing is a matter of state concern since it directly and
significantly affects public health, safety, the environment and in sum the general
welfare."
It is the submission of the Province of Camarines Sur that its exercise of the power
of eminent domain cannot be restricted by the provisions of the Comprehensive
Agrarian Reform Law (R.A. No. 6657), particularly Section 65 thereof, which
requires the approval of the Department of Agrarian Reform before a parcel of land
can be reclassified from an agricultural to a non-agricultural land.
The Court of Appeals, following the recommendation of the Solicitor General, held
that the Province of Camarines Sur must comply with the provision of Section 65 of
the Comprehensive Agrarian Reform Law and must first secure the approval of the
Department of Agrarian Reform of the plan to expropriate the lands of the San
Joaquins.
In Heirs of Juancho Ardana v. Reyes, 125 SCRA 220, petitioners raised the issue of
whether the Philippine Tourism Authority can expropriate lands covered by the
"Operation Land Transfer" for use of a tourist resort complex. There was a finding
that of the 282 hectares sought to be expropriated, only an area of 8,970 square
meters or less than one hectare was affected by the land reform program and
covered by emancipation patents issued by the Ministry of Agrarian Reform. While
the Court said that there was "no need under the facts of this petition to rule on
whether the public purpose is superior or inferior to another purpose or engage in a
balancing of competing public interest," it upheld the expropriation after noting that
petitioners had failed to overcome the showing that the taking of 8,970 square
meters formed part of the resort complex. A fair and reasonable reading of the
decision is that this Court viewed the power of expropriation as superior to the
power to distribute lands under the land reform program.
The Solicitor General denigrated the power to expropriate by the Province of
Camarines Sur by stressing the fact that local government units exercise such power
only by delegation. (Comment, pp. 14-15; Rollo, pp. 128-129)
It is true that local government units have no inherent power of eminent domain and
can exercise it only when expressly authorized by the legislature (City of Cincinnati
v. Vester, 28l US 439, 74 L.ed. 950, 50 SCt. 360). It is also true that in delegating
the power to expropriate, the legislature may retain certain control or impose certain
restraints on the exercise thereof by the local governments (Joslin Mfg. Co. v.
Providence, 262 US 668 67 L. ed. 1167, 43 S Ct. 684). While such delegated power
may be a limited authority, it is complete within its limits. Moreover, the limitations
on the exercise of the delegated power must be clearly expressed, either in the law
conferring the power or in other legislations.
Resolution No. 129, Series of 1988, was promulgated pursuant to Section 9 of B.P.
Blg. 337, the Local Government Code, which provides:
A local government unit may, through its head and acting
pursuant to a resolution of its sanggunian exercise the right of
eminent domain and institute condemnation proceedings for
public use or purpose.
Section 9 of B.P. Blg. 337 does not intimate in the least that local government, units
must first secure the approval of the Department of Land Reform for the conversion
of lands from agricultural to non-agricultural use, before they can institute the
necessary expropriation proceedings. Likewise, there is no provision in the
Comprehensive Agrarian Reform Law which expressly subjects the expropriation
of agricultural lands by local government units to the control of the Department of
Agrarian Reform. The closest provision of law that the Court of Appeals could cite
to justify the intervention of the Department of Agrarian Reform in expropriation
matters is Section 65 of the Comprehensive Agrarian Reform Law, which reads:
Sec. 65. Conversion of Lands. After the lapse of five (5)
years from its award, when the land ceases to be
economically feasible and sound for, agricultural purposes, or
the locality has become urbanized and the land will have a
greater economic value for residential, commercial or
industrial purposes, the DAR, upon application of the
beneficiary or the landowner, with due notice to the affected
parties, and subject to existing laws, may authorize the
reclassification or conversion of the land and its
disposition: Provided, That the beneficiary shall have fully
paid his obligation.
The opening, adverbial phrase of the provision sends signals that it applies to lands
previously placed under the agrarian reform program as it speaks of "the lapse of
five (5) years from its award."
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.
Statutes conferring the power of eminent domain to political subdivisions cannot be
broadened or constricted by implication (Schulman v. People, 10 N.Y. 2d. 249, 176
N.E. 2d. 817, 219 NYS 2d. 241).
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.
Ordinarily, it is the legislative branch of the local government unit that shall
determine whether the use of the property sought to be expropriated shall be public,
the same being an expression of legislative policy. The courts defer to such
legislative determination and will intervene only when a particular undertaking has
no real or substantial relation to the public use (United States Ex Rel Tennessee
Valley Authority v. Welch, 327 US 546, 90 L. ed. 843, 66 S Ct 715; State ex rel
Twin City Bldg. and Invest. Co. v. Houghton, 144 Minn. 1, 174 NW 885, 8 ALR
585).
There is also an ancient rule that restrictive statutes, no matter how broad their
terms are, do not embrace the sovereign unless the sovereign is specially mentioned
as subject thereto (Alliance of Government Workers v. Minister of Labor and
Employment, 124 SCRA 1 [1983]). The Republic of the Philippines, as sovereign,
or its political subdivisions, as holders of delegated sovereign powers, cannot be
bound by provisions of law couched in general term.
The fears of private respondents that they will be paid on the basis of the valuation
declared in the tax declarations of their property, are unfounded. This Court has
declared as unconstitutional the Presidential Decrees fixing the just compensation in
expropriation cases to be the value given to the condemned property either by the
owners or the assessor, whichever was lower ([Export Processing Zone Authority v.
Dulay, 149 SCRA 305 [1987]). As held in Municipality of Talisay v. Ramirez, 183
SCRA 528 [1990], the rules for determining just compensation are those laid down
in Rule 67 of the Rules of Court, which allow private respondents to submit
evidence on what they consider shall be the just compensation for their property.
WHEREFORE, the petition is GRANTED and the questioned decision of the Court
of Appeals is set aside insofar as it (a) nullifies the trial court's order allowing the
Province of Camarines Sur to take possession of private respondents' property; (b)
orders the trial court to suspend the expropriation proceedings; and (c) requires the
Province of Camarines Sur to obtain the approval of the Department of Agrarian
Reform to convert or reclassify private respondents' property from agricultural to
non-agricultural use.
The decision of the Court of Appeals is AFFIRMED insofar as it sets aside the order
of the trial court, denying the amended motion to dismiss of the private
respondents.
SO ORDERED.
Cruz, Grio-Aquino and Bellosillo, JJ., concur.
 After full payment to the Land Bank of the Philippines of the amortizations, the
farmer-beneficiarieswere issued Emancipation Patents8 (EPs), as shown below:
Republic of the Philippines
SUPREME COURT
Manila
The remaining area of 3.2942 hectares covered by OLT was not issued with EPs.10
THIRD DIVISION
On February 8, 1992, prior to the registration of the EPs in the Registry of Deeds,
Name of Farmer- TCT Location Previous Area Delfino filed an Application for Retention over the entire 14.6717-hectare riceland.
Beneficiary No./EP TCT No. (in has.) Upon the recommendation of the Department of Agrarian Reform (DAR), Laguna
Provincial Office, the DAR Regional Office IV Director issued an Order 11 dated
Avelino Anasao EP-791 Tagapo, Sta. Rosa, T-21712 3.0016 June 22, 1993 denying retention of the 9.8597 hectares but granting retention over
Laguna the 4.8120 hectares which was not covered by OLT.12
Angel Anasao EP-790 Tagapo, Sta. Rosa T-21712 .7029
Delfino appealed to then DAR Secretary Ernesto D. Garilao who issued an
Angel Anasao EP-792 Tagapo, Sta. Rosa T-21712 .1815 Order13 dated February 28, 1995, as follows:
Rodriguez EP-782 Pook, Sta. Rosa T-21710 2.6811
Dacumos Laguna WHEREFORE, premises considered, this Order is hereby issued setting aside the
Transfer Certificate Area Classificatio Order of the DAR Regional Director of Region IV dated June 22, 1993, thus
Location Total 6.56719 petitioner is hereby given the maximum of five (5) hectares from the tenanted
of Title (TCT) No. (in hectares) n
portion as his retained area.
G.R. No. 197486 September 10, 2014
T-21710 (T-49743) 2.8148 Riceland Pook Sta. Rosa

T-21711 (T-49744) .0872 Riceland Pook Sta. Rosa SO ORDERED.14

RENATO L. DELFINO, SR. (Deceased), Represented by his Heirs, namely:
GRACIA DELFINO, GREGORIO A. DELFINO; MA. ISABEL A. DELFINO,
T-21712 (T-49745) 4.1787 Riceland Tagapo, Sta. Rosa RENATO A. DELFINO, JR., MA. REGINA DELFINO ROSELLA, MA. A motion for reconsideration by way of motion for intervention was filed by
GRACIA A. DELFINO, MARIANO A. DELFINO, MA. LUISA DELFINO respondents who argued that the implementation of the February 28, 1995 Order
T-26378 (T-69592) 2.8662 Riceland Tagapo, Sta. Rosa GREGORIO and REV. FR. GABRIELA. DELFINO, Petitioners, will have the effect of cancelling the EPs and consequently deprive them of
vs. ownership of the landholdings they acquired pursuant to PD 27. In his Order dated
Coconut
T-26381 (T-69595) 20.8108 Masaya, Bay AVELINO K. ANASAO and ANGEL K. ANASAO (Deceased and represented December 13,1995, Secretary Garilao denied the motion for utter lack of
land
by his sole heir, SIXTO C. ANASAO), Respondents. merit.15 Respondents appealed to the OP but later withdrew the appeal and instead
Sta. Cruz, Sta. filed a petition for review in the CA (CAG.R. SP No. 39761). By Resolution dated
T-216233 4.7248 Riceland March 15, 1996, the CAs Third Division dismissed the petition for being
Rosa DECISION
insufficient in form and substance. Respondents motion for reconsideration was
Total 35.4825 has. 6 likewise denied under Resolution dated January 28, 1997. Entry of judgment was
VILLARAMA, JR., J.: issued by the CA on said case.16

Assailed in this petition for review under Rule 45 are the Decision 1 dated January
31, 2011 and Resolution2 dated June 17, 2011 of the Court of Appeals (CA) in CA-
G.R. SP No. 111147. The CA reversed and set aside the Decision 3 dated February 6,
2008 and Resolution4 dated September 30,-2008 of the Office of the Pre.sident (OP)
denying the petition to annul or cancel the Orders 5 dated February 28, 1995 and
December 13, 1995 of the Secretary of Agrarian Reform and clarifying the Order
dated February 28, Factual Antecedents Prior to the effectivity of Presidential
Decree No. 27 (PD 27) Renato L. Delfino, Sr. (Delfino) owned the following
parcels of agricultural land in the Province of Laguna:
Meanwhile, on August 24, 1995, Delfino sold two hectares of his tenanted riceland
covered by TCT Nos. T-26378 (T-69592) situated in Barangay Tagapo, Sta. Rosa,
Laguna, to SM Prime Holdings, Inc. Though covered by OLT, no EP had been
issued on this portion under TCT No. T-26378 (T-69592).17 A new certificate of title
(TCT No. T-389984) in the name of SM Prime Holdings, Inc.was issued on
February 25, 1997.18
On September 13, 1995, Delfino filed before the Provincial Agrarian Reform
Adjudicator (PARAD) a petition19 for cancellation of the EPs previously issued to
respondents on the basis of the DAR Secretarys Order dated December 13, 1995
granting him fivehectares as retention area (DCN- IV-La-0437-95).

On February 17, 1997, respondents filed before the Office of the DAR Secretary a
Motion for Clarificatory Judgment 20 praying that an administrative determination be
made of the particularportion to be retained and whether such right of retention will
In October 1975, Delfino soldthe 20.8108-hectare coconut land covered by TCT
result in the cancellation of EPs already distributed to farmer-beneficiaries
No. T-26381 (T-69595), leaving him with 14.6717 hectares of riceland. The
identified as of October 21, 1972.
tenanted portion (9.8597 hectares) being tilled by respondents Avelino K. Anasao
and Angel K. Anasao, and another farmer, Rodriguez P. Dacumos was placed under
Operation Land Transfer (OLT) pursuant to Presidential Decree No. 27 (PD 27).7
Meanwhile, in a Joint Order21 dated February 19,1997, Provincial Adjudicator
Barbara P. Tan granted Delfinos petition for cancellation of EPs, as follows:
WHEREFORE, in the light of the foregoing considerations, ORDER is hereby
jointly issued in the instant consolidated petitions, to wit:
1. Declaring an aggregate area offive (5) hectares consisting of the lots covered by
the following certificates of title or Emancipation Patents as Petitioners retention
area, to wit:
1) Transfer Certificate of Title No. EP-782, EP No. A-326714
in the name of Rodriguez Dacumos corresponding to a
portion thereof with an area of 1.1140 hectares;
2) Transfer Certificate of Title No. EP-791, EP No. A-326741
in the name of Avelino K. Anasao with an area of 3.0016
hectares;
3) Transfer Certificate of Title No. EP-790, EP No. A-326742
and Transfer Certificate of Title No. EP-792, EP No. A-
326743 in the name of Angel K. Anasao with a total area of .
8844 hectare;
2. Directing the Register of Deeds of Laguna to cause the cancellation of the above-
mentioned certificates of title registered in the names of Respondents Avelino K.
Anasao and Angel K. Anasao and the reinstatement of Transfer Certificate of Title
No. T-21712 in the name of Renato L. Delfino, Sr.;
3. Directing said Register of Deeds of Laguna to cause the inscription of the instant
Order onthe original and Owners duplicate copies of Transfer Certificate of Title
No. EP-782, EP No. A-326714 in the name of Respondent Rodriguez Dacumos in
respect of the area of 1.1140 hectares;
4. Declaring the subject parcels of land constituting Petitioners retention area
reverted to agricultural leasehold status and private Respondents as the agricultural
lessees over their respective landholdings thus reverted;
5. Directing private Respondents Avelino K. Anasao, Angel K. Anasao and
Rodriguez Dacumos to surrender their respective owners duplicate of the subject
certificates of title or Ema[n]cipation Patents to this Office and/or to its authorized
Officer upon proper writ of execution for purposes of implementing the instant
Order, Provided, in the event of failure or refusal on their part to comply herewith
the subject owners duplicate of the said certificates of title or emancipation patents
shall be deemed cancelled sans any need of prior surrender.
SO ORDERED.22
A writ of execution was issued on May 19, 1997 directing the DARAB Provincial
Sheriff toretrieve the owners duplicate copies of the subject EPs for purposes of
cancellation and/or annotation. Respondents then filed a petition for certiorari inthe
CA (CA-G.R. SP No. 44285) to annul the said writ and enjoin its implementation. 23
In their Supplemental Motion24 (to the Motion for Clarificatory Judgment),
respondents pointed out that Delfino acted in bad faith when he sold a portion of the
OLT-covered land infavor of SM Prime Holdings, Inc. without the required DAR
clearance. They also prayed that the DAR Secretary order the PARAD to stop the
implementation of the Joint Order in DARAB Case No. DCN-IV-La-0437-95.
In his Order25 dated August 8, 1997, Secretary Garilao denied respondents motion:
A perusal of the records would show that as far as this Office is concerned, the
questioned Order has already become final and executory as attested to by Director
Ruben Joel A. Puertollano of the Bureau of Agrarian Legal Assistance, in his
Memorandum dated 16 May 1997. Even granting, for the sake of argument, that the
herein motion could still be entertained, the undeniable fact remains that the issues
sought to be clarified herein have already been ruled upon by this Office in its
Orders dated 28 February 1995 and 13 December 1995. The same issues were
raised in petitioners Petition for Review with the Court of Appeals which had
likewise been dismissed for being insufficient in form and substance.
WHEREFORE, premises considered, an Order is hereby issued DENYING herein
Motion for Clarificatory Judgment. This case is considered closed.
SO ORDERED.
On September 20, 2001,respondents filed a Petition to Annul and/or Cancel the
DAR Secretarys Orders dated February 28, 1995, December 13, 1995 and August
8, 1997 on the following grounds: (1) Delfino is guilty of fraud, misrepresentation
and concealment of a material fact, in his application for retention; and (2)
respondents EPs, which are now covered by transfer certificates of title, can be
cancelled only by order of a court, and not by the DAR or its Secretary.26
On February 2, 2006, DAR Secretary Nasser C. Pangandaman issued an
Order27 denying the petition to annul/cancel the subject orders and clarifying the
February 28, 1995 Order of Secretary Garilao, viz:
WHEREFORE, premises considered, Order is hereby issued DENYINGthe Petition
to Annul/Cancel the Orders of the Secretary of Agrarian Reform dated 28 February
1995, 13 December 1995 and 08 August 1997, respectively. Therefore,the Order
dated 28 February 1995 is hereby AFFIRMED.
FURTHER, the Order dated 28 February 1995 is hereby CLARIFIEDto read:
1. The Deed of Sale dated 24 August 1995 executed by the respondent
and SM Prime Holdings, Inc. with an area of two (2) hectares shall be
considered as the respondents retention area;
2. The remaining three (3) hectares shall either be taken from the 4.8120
hectares covered by TCT Nos. T-21711 (T-49744) and T-216233; and
3. The concerned Regional Director, PARO and the MARO are hereby
DIRECTEDto proceed with the coverage of the remains of parcels of
agricultural land owned by respondent, after having been given the five
(5) hectare retained area pursuant to the above,for distribution to
qualified farmerbeneficiaries pursuant to existing rules and regulations.
SO ORDERED.28
Delfino filed a motion for reconsideration which was denied by Secretary
Pangandaman in his Order29 dated May 30, 2007, thus:
It is beyond dispute that the right to choose the retention area pertains to the
landowner. However,this Office will not allow anyone to circumvent the very
purpose of the Comprehensive Agrarian Reform Program the five (5) hectare
retention limit. It bears stressing that the inclusion of the two (2) hectares which is
the subjectof the Deed of Sale dated 24 August 1995 executed by the respondent in
favor of SM Prime Holdings, Inc., as retained area is only to prevent the former to
exercise his right of retention beyond the maximum limits allowed by law. The
herein respondent cannot simultaneously enjoy from [sic] the proceeds of the Deed
of Sale and at the same time exercise the right of retention under CARP.
xxxx
As regards petitioners contention thatthere is a need to clarify the Order dated 02
February 2006 in order toeffect the reinstatement of the cancelled TCTs/EPs, this
Office finds the contention unmeritorious. While it is true that the respondents five
(5) hectares retained area were already delineated and clarified in the assailed Order
dated 02 February 2006, nevertheless, this Office cannot issue a directive
reinstating TCT No. EP-791 in favor of petitioner Avelino K. Anasao covering the
3.0016 hectares landholding and TCT Nos. EP-790 and 792 in favor of petitioner
Angel Anasao covering the landholdings, with an area of 0.7029 and 0.1815
hectare, respectively.
It must be noted that petitioners titles were cancelled by the DARAB in a separate
action for cancellation filed by herein respondent Renato L. Delfino, which was
docketed as DARAB Case No. IV-La 437-95. This Office, therefore, cannot
interfere with the decision of said forum. To do so would tantamount to
encroachment of powers.
Inasmuch as petitioner Rodriguez D. Dacumos filed a Motion to Withdraw Petition
and/or Desistance to Further Pursue Petition, wherein he manifested that he is no
longer interested in pursuing the instant case, this Office is constrained to dismiss
the case in so far as petitioner Rodriguez D. Dacumos is concerned. As pointed out
by petitioner Rodriguez D. Dacumos, he and hereinrespondent Renato L. Delfino
have threshed out already their differences and reached an agreement to settle the
case amicably. Hence, the petitioners prayers, to wit: that his name would be
dropped as party petitioner inthe instant case and the property covered by TCT No.
EP-782 would be declared as no longer included in the instant case, is hereby
granted. WHEREFORE, in the light of the foregoing premises, Order is hereby
issued DENYINGthe herein Motion for Reconsideration. Thus, the assailed Order
dated 2 February 2006 is hereby AFFIRMED.
SO ORDERED.30
Respondents appealed the Orders dated February 2,2006 and May 30, 2007 to the
OP.
On February 6, 2008, the OP rendered its Decision partly granting the appeal by
nullifying the portion of the May 30, 2007 Order of Secretary Pangandaman which
clarified Secretary Garilaos February 28, 1995 Order. Said office ruled that the two
hectaressold to SM Prime Holdings, Inc. would not bring about any ambiguity in
the execution of the Order dated February 28, 1995, in relation to the December 13,
1995 and August 8, 1997 Orders, and that whatever remains after deducting the
9.6717 hectares reserved for the farmer-beneficiaries pertains to Delfino. As to the
remaining portion of the May 30, 2007 Order of Secretary Pangandaman, the same
was upheld.
Respondents motion for reconsideration was denied under the OPs Resolution
dated September 30, 2008.
The case was elevatedby respondents to the CA via a petition for review under Rule
43. By Decision dated January 31, 2011, the CA reversed the OPs ruling and
reinstated the Orders dated February 2, 2006 and May 30, 2007 of Secretary
Pangandaman. According to the CA, the ambiguity in the February 28, 1995 Order
of Secretary Garilao lies in its failure to specify as to which portion of the 14.617
hectaresshould the five hectares retention area of Delfino be taken. Thus, evenafter
the said order had become final and executory, the DAR Secretary is not precluded
from making the necessary amendments/clarifications thereof so that the fallo
would at least conform with the body of said order and so that the same could
readily be executed with dispatch. But since Delfino sold two hectares to SM Prime
Holdings, Inc. before the ambiguity could be properly addressed by DAR, the CA
found no reversible error in the February 2, 2006 Order clarifying the ambiguity
and in the May 30, 2007 Order stating the rationale for such clarification.
Delfino, represented by his surviving heirs (petitioners) filed a motion for
reconsideration but the CA deniedit under Resolution dated June 17, 2011.
Issues
The issues to be resolved in the present controversy are: (1) whether the February 2,
2006 Order of Secretary Pangandaman, insofar as it clarified the February 28, 1995
Order of Secretary Garilao, violated the rule on immutability of final judgments;
and (2) whether the inclusion of the twohectare portion sold to SM Prime Holdings,
Inc. in Delfinos retention area was in derogation of Section 6 of Republic Act No.
6657 (RA 6657).
Our Ruling
We grant in part the petition.
The right of retention is a constitutionally guaranteed right, which is subject to
qualification by the legislature.It serves to mitigate the effects of compulsory land
acquisition by balancing the rights of the landowner and the tenant and by
implementing the doctrine that social justice was not meant to perpetrate an
injustice against the landowner.31
In the landmark case of Association of Small Landowners in the Phils., Inc. v.
Secretary of Agrarian Reform, 32 this Court held that landowners who have not yet
exercised their retention rights under PD 27 are entitled to the new retention rights
under RA 6657. Section 6 of the latter law defines the nature and incidents of the
landowners right to retention, thus:
SEC. 6. Retention Limits Exceptas otherwise provided in this Act, no person may
own or retain, directly or indirectly, any public or private agricultural land, the size
of which shall vary according to factors governing a viable family-sized farm, such
as commodity produced, terrain, infrastructure, and soil fertility as determined by
the Presidential Agrarian Reform Council (PARC) created hereunder, but in no case
shall retention by the landowner exceed 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 Delfinos retention area, which meant that Delfino is entitled only to the balance of
or directly managing the farm: Provided, That landowners whose land have been three hectares.
covered by Presidential Decree No. 27 shall be allowed to keep the area originally
retained by them thereunder; Provided, further, That original homestead grantees or
As explained by Secretary Pangandaman in his order denying Delfinos motion for
their direct compulsory heirs who still own the original homestead at the time of the
reconsideration, thisclarification was made in order not to circumvent the five-
approval of this Act shall retain the same areas as long as they continue to cultivate
hectare limitation as said landowner "cannot [be allowed to] simultaneously enjoy
said homestead.
the proceeds of the [sale] and at the same time exercise the right of
retention"37 to the maximum of five hectares.
The right to choose the area to be retained, which shall be compact or contiguous,
shall pertain to the landowner; Provided, however, That in case the area selected for
Petitioners argue that the amendment/clarification of the February 28, 1995 Order
retention by the landowner is tenanted, the tenant shall have the option to choose
resulted in the diminution of Delfinos right of retention under Section 6 of RA
whether to remain therein or be a beneficiary in the same or another agricultural
6657 because the DAR Secretary cannot impose on the landowner the area of
land with similar or comparable features. In casethe tenant chooses to remain in the
retention, the choice of the landowner having been upheld in numerous cases
retained area, he shall be considered a leaseholder and shall lose his right to be a
decided by this Court particularly in Daez v. Court of Appeals 38 .It is further
beneficiary under this Act. In case the tenant chooses to be a beneficiary in another
contended that the two hectares sold to SM by Delfino cannot be considered as
agricultural land, he loses his right as a leaseholder to the land retained by the
retention area, the same having been declared not agricultural land, pursuant to the
landowner. The tenant must exercise this option within a period of one (1) year
Exemption Order39 dated September 14, 2005 issued by Regional Director Homer P.
fromthe time the landowner manifests his choice of the area for retention.
Tobias.
In all cases, the security of tenure of the farmers or farmworkers on the land prior to
On the matter of allowing Delfino to choose the remaining three hectares of his
the approval of this Act shall be respected.
retention area,we rule for the petitioners.
Upon the effectivity of this Act,any sale, disposition, lease, management contract or
While we agree with Secretary Pangandaman in holding that Delfino had partially
transfer ofpossession of private lands executed by the original landowner in
exercised his right of retention when he sold two hectares to SM Prime Holdings,
violation of this Act shall be null and void; Provided, however, That those executed
Inc., afterhis application for retention was granted by Secretary Garilao, we cannot
prior to this Act shall be valid only when registered with the Registerof Deeds
affirm the portion of the February 2, 2006 Order which decreed that the remaining
within a period of three (3) months after the effectivity of this Act. Thereafter, all
three hectares shall be taken "either from the 4.8120 hectares covered by TCT Nos.
Registers of Deeds shall inform the DAR within thirty (30) days of any transaction
T-21711 (T-49744) and T-216233."40 Such directive encroaches on the prerogative
involving agricultural lands in excess of five (5) hectares. (Emphasis supplied.)
expressly given to landowners under Section 6 of RA 6657 tochoose their area of
Under the February 28, 1995 Order of Secretary Garilao, Delfino was granted five
retention.
hectares "from the tenantedportion as his retained area." Said order had become
final and executory on March 9, 1997.
As this Court held in Daez v. Court of Appeals, 41 the right of retention can be
exercised over tenanted land and even where CLOAs or EPs have been issued to
A decision that has acquired finality becomes immutable and unalterable, and may
tenant-farmers provided that the right of tenants under Section 6 of RA 6657 is
no longer be modified in any respect, even if the modification is meant to correct
similarly protected. Thus:
erroneous conclusions of fact or law, and whether it will be made by the court that
rendered it or by the highest court of the land. 33 This doctrine of finality and
immutability of judgments is grounded on fundamental considerationsof public For as long as the area to be retained is compact or contiguous and it does not
policy and sound practice to the effect that, at the risk of occasional error, the exceed the retention ceiling of five (5) hectares, a landowners choice of the area to
judgments of the courts must become final at somedefinite date set by law.34 be retained, must prevail.Moreover, Administrative Order No. 4, series of 1991,
which supplies the details for the exercise of a landowners retention rights,
likewise recognizes no limit to the prerogative of the landowner, although he is
There are, however, exceptions to the general rule, namely: (1) the correction of
persuaded to retain other lands instead to avoid dislocation of farmers.
clerical errors; (2) the so-called nunc pro tuncentries which cause no prejudice to
any party; (3) void judgments; and (4) whenever circumstances transpire after the
finality of the decision rendering its execution unjust and inequitable. 35 The Without doubt, this right of retention may be exercised over tenanted land despite
exception to the doctrine of immutability of judgment has been applied in several even the issuance of Certificate of Land Transfer (CLT) to farmer-beneficiaries.
cases in order to serve substantial justice.36 What must be protected, however, is the right of the tenants toopt to either stay on
the land chosen to be retained by the landowner or be a beneficiary in another
agricultural land with similar or comparable features.
In this case, the clarification made by Secretary Pangandaman in his February 2,
2006 Order falls under the fourth exception.
xxxx
It is true that the February 28, 1995 Order of Secretary Garilao stated that the five
hectares shall be taken from the tenanted area, which pertains to the 9.8597 The issuance of EPs or CLOAs to beneficiaries does not absolutely bar the
hectaresof which 6.5671 hectares were already issued with EPs in favor of landowner fromretaining the area covered thereby. Under Administrative Order No.
respondents. Subsequently, however, without prior clearance from the DAR, 2, series of 1994, an EP or CLOA may be cancelled if the land covered is later
Delfino sold two hectares of land covered by OLT to SM Prime Holdings, Inc. The found to be part of the landowners retained area.
DAR Secretary thus found it fair and equitable to include the said portion to
A certificate of title accumulates inone document a comprehensive statement of the The same liberality should likewise be applied to the certification against forum FRANCIS H. JARDELEZA
status of the fee heldby the owner of a parcel of land. As such, it is a mere evidence shopping.1wphi1 The general rule is that the certification must be signed by all Associate Justice
of ownership and it does not constitute the title to the land itself. It cannot confer plaintiffs in a case and the signature of only one of them is insufficient. However,
title where no title has been acquired by any of the means provided by law. the Court has also stressed in a number of cases that the rules onforum shopping
AT T E S T AT I O N
were designed to promote and facilitate the orderly administration of justice and
thus should not be interpreted with such absolute literalness as to subvert its own
Thus, we had, in the past, sustained the nullification of a certificate of title issued
ultimate and legitimate objective. The rule of substantial compliance may be I attest that the conclusions in the above Decision had beetyreached in consultation
pursuant to a homestead patent because the land covered was not part of the public
availed of with respect to the contents of the certification. This is because the before the case was assigned to the writer of the opinion of the Court's Division.
domain and as a result, the government had no authority to issue such patent in the
requirement of strict compliance with the provisions merely underscores its
first place. Fraud in the issuance of the patent, is also a ground for impugning the
mandatory nature in that the certification cannot be altogether dispensed with or its
validity of a certificate of title. In other words, the invalidity of the patent or title is PRESBITERO J. VELASCO, JR.
requirements completely disregarded.
sufficient basis for nullifying the certificate of title since the latter is merely an Associate Justice
evidence of the former. Chairperson, Third Division
The substantial compliance rule has been applied by this Court in a number of
cases: Cavile v. Heirs of Cavile, where the Court sustained the validity of the
In the instant case, the CLTs of private respondents over the subject 4.1685-hectare C E R T I F I C AT I O N
certification signed by only one of petitioners because he is a relative of the other
riceland were issued without Eudosia Daez having been accorded her right of
petitioners and co-owner of the properties in dispute; Heirs of Agapito T. Olarte v.
choice as to what to retain among her landholdings. The transfer certificates of title
Office of the President of the Philippines, where the Court allowed a certification Pursuant to Section 13, Article VIII of the 1987 Constitution and the Division
thus issued on the basis of those CLTs cannot operate to defeat the right of the heirs
signed by only two petitioners because the case involved a family home in which all Chairperson's Attestation, I certify that the conclusions in the above Decision had
of deceased Eudosia Daez to retain the said 4.1685 hectares of
the petitioners shared a common interest; Gudoy v. Guadalquiver, where the Court been reached in consultation before the case was assigned to the writer of the
riceland.42 (Underscoring in the original; emphasis supplied.)
considered as valid the certification signed by only four of the nine petitioners opinion of the Court's Division.
because all petitioners filed as co-owners pro indivisoa complaint against
As to the Exemption Order allegedly issued by the DAR Regional Director dated respondents for quieting of title and damages, as such, they all have joint interest in
the undivided whole; and Dar v. AlonzoLegasto, where the Court sustained the ANTONIO T. CARPIO
September 14, 2005, the Court notes that the matter of SM Prime Holdings, Inc.s
certification signed by only one of the spouses as they were sued jointly involving a Acting Chief Justice
application for exemption from CARP coverage was never raised by petitioners
during the proceedings before the Regional Director and OP. Records showed that property in which they had a common interest.
the administrative declaration of "non-agricultural" use of the two-hectare portion
sold to SM Prime Holdings, Inc. pursuant to a 1981 zoning classification ordinance,
It is noteworthy that in all of the above cases, the Court applied the rule on
was mentioned by petitioners for the first time in their Motion for Reconsideration
substantial compliance because of the commonality of interest of all the parties with
dated February 17, 2011 after the CA rendered its adverse ruling, attaching a
respect to the subject of the controversy.45 (Emphasis supplied.)
photocopy thereof tothe motion. The only grounds or arguments invoked by Footnotes
petitioners in their Memorandum submitted to the CA were the finality of the
assailed DAR Secretarys Orders dated February 28, 1995, December 13, 1995 and WHEREFORE, the petition is PARTLY GRANTED.The Decision dated January 1
Rollo, pp. 60-77. Penned by Associate Justice Jane Aurora C. Lantion
August 8, 1997 and that respondents petition for review was filed out of time. 31, 2011 of the Court ofAppeals in CA-G.R. SP No. 111147 is AFFIRMEDinsofar
with Presiding Justice Andres B. Reyes, Jr. and Associate Justice Japar
as it upheld the February 2, 2006 Order of Secretary Pangandaman declaring the
B. Dimaampao concurring.
two-hectare land covered by TCT No. T-26378 (T-69592) which was sold by
The general rule is that issues raised for the first time on appeal and not raised in
Renato L. Delfino, Sr. to SM Prime Holdings, Inc. as part of his retention area.
the proceedings in the lower court are barred by estoppel. Points of law, theories, 2
Id. at 79-80.
issues, and arguments not brought to the attention of the trial court ought not to be
considered by a reviewing court, as these cannot be raised for the first time on The aforesaid Order is MODIFIEDin that herein petitioners, heirs of Delfino, Sr.,
appeal. To consider the alleged facts and arguments raised belatedly would amount are hereby allowed to choose three hectares of their retention area from the 3
Id. at 112-119.
to trampling on the basic principles of fair play, justice, and due process.43 remaining portions of Delfino, Sr.s landholding situated in Sta. Rosa, Laguna,
subject to the conditions laid down in Section 6 of RA 6657 and DAR regulations. 4
Id. at 120-124.
Respondents are likewise entitled to exercise the rights granted to tenants-
Finally, we find no merit in respondents argument that the present petition should
beneficiaries affected by landowners retention.
be dismissed for failure of the other co-heirs/co-petitioners to sign the verification 5
DAR records, pp. 161-167.
and certification against forum-shopping as required by Sections 4 and 5, Rule 7 of
the 1997 Rules of Civil Procedure. In the case of Iglesia Ni Cristo v. Judge SO ORDERED.
Ponferrada44 we expounded on the purpose and sufficiency of compliance with the 6
OP records, p. 38.
verification and certification against forum shopping requirements, viz:
MARTIN S. VILLARAMA, JR.
Associate Justice 7
Id.
The issue in the present case is not the lack of verification but the sufficiency of one
executed by only one of plaintiffs. This Court held in Ateneo de Naga University v.
WE CONCUR: 8
DAR records, pp. 272-277.
Manalo, that the verification requirement is deemed substantially complied with
when, as in the present case, only one of the heirs-plaintiffs, who has sufficient
knowledge and belief to swear to the truth of the allegations in the petition PRESBITERO J. VELASCO, JR. 9
OP records, p. 37.
(complaint), signed the verification attached to it.Such verification is deemed Associate Justice
sufficient assurance that the matters alleged in the petition have been made in good 10
faith or are true and correct, not merely speculative. Id.
DIOSDADO M. PERALTA BIENVENIDO L. REYES
Associate Justice Associate Justice 11
DAR records, p. 246.
12 35
OP records, p. 37. FGU Insurance Corporation v. Regional Trial Court of Makati City,
Branch 66, G.R. No. 161282, February 23, 2011, 644 SCRA 50, 56,
13 citing Villa v. Government Service Insurance System (GSIS), G.R. No.
DAR records, pp. 165-167.
174642, October 30, 2009, 604 SCRA 742, 750.
14
Id. at 166-167. 36
Id. Citations omitted.
15
Id. at 117-119,161-164, 168-176. 37
OP records, pp. 29-30.
16
Id. at 177-187, 387, 437-442. 38
Supra note 31.
17
OP records, p. 37. 39
Rollo, pp. 284-287.
18
Rollo, pp. 241-242. 40
OP records, p. 34.
19
DAR records, pp. 1-2. 41
Supra note 31, at 754.
20
Id. at 471-474. 42
Id. at 754-756.
21
Id. at 480-484. 43
Ramos v. Philippine National Bank, G.R. No. 178218, December 14,
2011, 662 SCRA 479, 495, citing Imani v. Metropolitan Bank & Trust
22
Id. at 482-484. Company, G.R. No. 187023, November 17, 2010, 635 SCRA 357, 371.

44
23
Id. at 370-374, 476-479. 536 Phil. 705 (2006).

45
24
Id. at 259-267. Id. at 719-720.

25
Id. at 310.

26
Id. at 288-297.

27
OP records, pp. 33-39.

28
Id. at 34.

29
Id. at 27-31.

30
Id. at 28-30.

31
Daez v. Court of Appeals, 382 Phil. 742, 752 (2000), citing Sec.4, Art.
XIII, 1987 Constitution, Cabatan v. Court of Appeals, 184 Phil. 281,
314-315 (1980) and Dequito v. Llamas, 160-A Phil. 7, 16 (1975).

32
256 Phil. 777, 825 (1989).

33
SECOND DIVISION
Heirs of Maura So v. Obliosca, 566 Phil. 397, 407 (2008).

34
Baares II v. Balising, 384 Phil. 567, 582 (2000).
[G.R. No. 127198. May 16, 2005]
LAND BANK OF THE PHILIPPINES, petitioner, vs. HON. ELI G. C.
NATIVIDAD, Presiding Judge of the Regional Trial Court, Branch
48, San Fernando, Pampanga, and JOSE R. CAGUIAT represented
by Attorneys-in-fact JOSE T. BARTOLOME and VICTORIO
MANGALINDAN, respondents.
DECISION
TINGA, J.:
This is a Petition for Review[1] dated December 6, 1996 assailing
the Decision[2] of the Regional Trial Court [3] dated July 5, 1996 which ordered the
Department of Agrarian Reform (DAR) and petitioner Land Bank of the Philippines
(Land Bank) to pay private respondents the amount of P30.00 per square meter as
just compensation for the States acquisition of private respondents properties under
the land reform program.
The facts follow.
On May 14, 1993, private respondents filed a petition before the trial court
for the determination of just compensation for their agricultural lands situated in
Arayat, Pampanga, which were acquired by the government pursuant to Presidential
Decree No. 27 (PD 27). The petition named as respondents the DAR and Land
Bank. With leave of court, the petition was amended to implead as co-respondents
the registered tenants of the land.
After trial, the court rendered the assailed Decision the dispositive portion of
which reads:
WHEREFORE, judgment is hereby rendered in favor of petitioners and against
respondents, ordering respondents, particularly, respondents Department of
Agrarian Reform and the Land Bank of the Philippines, to pay these lands owned
by petitioners and which are the subject of acquisition by the State under its land
reform program, the amount of THIRTY PESOS (P30.00) per square meter, as the
just compensation due for payment for same lands of petitioners located at San
Vicente (or Camba), Arayat, Pampanga.
Respondent Department of Agrarian Reform is also ordered to pay petitioners the
amount of FIFTY THOUSAND PESOS (P50,000.00) as Attorneys Fee, and to pay
the cost of suit.
SO ORDERED.[4]
DAR and Land Bank filed separate motions for reconsideration which were
denied by the trial court in its Order[5] dated July 30, 1996 for being pro forma as
the same did not contain a notice of hearing. Thus, the prescriptive period for filing
an appeal was not tolled. Land Bank consequently failed to file a timely appeal and
the assailed Decision became final and executory.
Land Bank then filed a Petition for Relief from Order Dated 30 July 1996,
[6]
citing excusable negligence as its ground for relief. Attached to the petition for
relief were two affidavits of merit claiming that the failure to include in the motion
for reconsideration a notice of hearing was due to accident and/or mistake. [7] The
affidavit of Land Banks counsel of record notably states that he simply scanned and
signed the Motion for Reconsideration for Agrarian Case No. 2005, Regional Trial
Court of Pampanga, Branch 48, not knowing, or unmindful that it had no notice of
hearing[8] due to his heavy workload.
The trial court, in its Order[9] of November 18, 1996, denied the petition for
relief because Land Bank lost a remedy in law due to its own negligence.
In the instant petition for review, Land Bank argues that the failure of its
counsel to include a notice of hearing due to pressure of work constitutes excusable
negligence and does not make the motion for reconsideration pro forma considering
its allegedly meritorious defenses. Hence, the denial of its petition for relief from
judgment was erroneous.
According to Land Bank, private respondents should have sought the
reconsideration of the DARs valuation of their properties. Private respondents thus
failed to exhaust administrative remedies when they filed a petition for the
determination of just compensation directly with the trial court. Land Bank also
insists that the trial court erred in declaring that PD 27 and Executive Order No. 228
(EO 228) are mere guidelines in the determination of just compensation, and in
relying on private respondents evidence of the valuation of the properties at the
time of possession in 1993 and not on Land Banks evidence of the value thereof as
of the time of acquisition in 1972.
Private respondents filed a Comment[10] dated February 22, 1997, averring
that Land Banks failure to include a notice of hearing in its motion for
reconsideration due merely to counsels heavy workload, which resulted in the
motion being declared pro forma, does not constitute excusable negligence,
especially in light of the admission of Land Banks counsel that he has been a
lawyer since 1973 and has mastered the intricate art and technique of pleading.
Land Bank filed a Reply[11] dated March 12, 1997 insisting that equity
considerations demand that it be heard on substantive issues raised in its motion for
reconsideration.
The Court gave due course to the petition and required the parties to submit
their respective memoranda.[12] Both parties complied.[13]
The petition is unmeritorious.
At issue is whether counsels failure to include a notice of hearing constitutes
excusable negligence entitling Land Bank to a relief from judgment.
Section 1, Rule 38 of the 1997 Rules of Civil Procedure provides:
Sec. 1. Petition for relief from judgment, order, or other proceedings.When a
judgment or final order is entered, or any other proceeding is thereafter taken
against a party in any court through fraud, accident, mistake, or excusable
negligence, he may file a petition in such court and in the same case praying that
the judgment, order or proceeding be set aside.
As can clearly be gleaned from the foregoing provision, the remedy of relief
from judgment can only be resorted to on grounds of fraud, accident, mistake or
excusable negligence. Negligence to be excusable must be one which ordinary
diligence and prudence could not have guarded against.[14]
Measured against this standard, the reason profferred by Land Banks
counsel, i.e., that his heavy workload prevented him from ensuring that the motion
for reconsideration included a notice of hearing, was by no means excusable.
Indeed, counsels admission that he simply scanned and signed the Motion for
Reconsideration for Agrarian Case No. 2005, Regional Trial Court of Pampanga,
Branch 48, not knowing, or unmindful that it had no notice of hearing speaks
volumes of his arrant negligence, and cannot in any manner be deemed to constitute
excusable negligence.
The failure to attach a notice of hearing would have been less odious if
committed by a greenhorn but not by a lawyer who claims to have mastered the
intricate art and technique of pleading.[15]
Indeed, a motion that does not contain the requisite notice of hearing is
nothing but a mere scrap of paper. The clerk of court does not even have the duty to
accept it, much less to bring it to the attention of the presiding judge. [16] The trial
court therefore correctly considered the motion for reconsideration pro forma. Thus,
it cannot be faulted for denying Land Banks motion for reconsideration and petition
for relief from judgment.
It should be emphasized at this point that procedural rules are designed to
facilitate the adjudication of cases. Courts and litigants alike are enjoined to abide
strictly by the rules. While in certain instances, we allow a relaxation in the
application of the rules, we never intend to forge a weapon for erring litigants to
violate the rules with impunity. The liberal interpretation and application of rules
apply only in proper cases of demonstrable merit and under justifiable causes and
circumstances. While it is true that litigation is not a game of technicalities, it is
equally true that every case must be prosecuted in accordance with the prescribed
procedure to ensure an orderly and speedy administration of justice. Party litigants
and their counsel are well advised to abide by, rather than flaunt, procedural rules
for these rules illumine the path of the law and rationalize the pursuit of justice.[17]
Aside from ruling on this procedural issue, the Court shall also resolve the
other issues presented by Land Bank, specifically as regards private respondents
alleged failure to exhaust administrative remedies and the question of just
compensation.
Land Bank avers that private respondents should have sought the
reconsideration of the DARs valuation instead of filing a petition to fix just
compensation with the trial court.
The records reveal that Land Banks contention is not entirely true. In fact,
private respondents did write a letter[18] to the DAR Secretary objecting to the land
valuation summary submitted by the Municipal Agrarian Reform Office and
requesting a conference for the purpose of fixing just compensation. The letter,
however, was left unanswered prompting private respondents to file a petition
directly with the trial court.
At any rate, in Philippine Veterans Bank v. Court of Appeals,[19] we declared
that there is nothing contradictory between the DARs primary jurisdiction to
determine and adjudicate agrarian reform matters and exclusive original jurisdiction
over all matters involving the implementation of agrarian reform, which includes
the determination of questions of just compensation, and the original and exclusive
jurisdiction of regional trial courts over all petitions for the determination of just
compensation. The first refers to administrative proceedings, while the second
refers to judicial proceedings.
In accordance with settled principles of administrative law, primary
jurisdiction is vested in the DAR to determine in a preliminary manner the just
compensation for the lands taken under the agrarian reform program, but such
determination is subject to challenge before the courts. The resolution of just
compensation cases for the taking of lands under agrarian reform is, after all,
essentially a judicial function.[20]
Thus, the trial did not err in taking cognizance of the case as the
determination of just compensation is a function addressed to the courts of justice.
Land Banks contention that the property was acquired for purposes of
agrarian reform on October 21, 1972, the time of the effectivity of PD 27, ergo just
compensation should be based on the value of the property as of that time and not at
the time of possession in 1993, is likewise erroneous. In Office of the President,
Malacaang, Manila v. Court of Appeals,[21] we ruled that the seizure of the
 [8]
landholding did not take place on the date of effectivity of PD 27 but would take Id. at 105, Affidavit of Alfredo B. Pandico, Jr.
effect on the payment of just compensation. [9]
Id. at 118-119.
Under the factual circumstances of this case, the agrarian reform process is [10]
still incomplete as the just compensation to be paid private respondents has yet to Id. at 128-134.
be settled. Considering the passage of Republic Act No. 6657 (RA 6657) [22] before [11]
Id. at 139-146.
the completion of this process, the just compensation should be determined and the
process concluded under the said law. Indeed, RA 6657 is the applicable law, with [12]
Id. at 172-173.
PD 27 and EO 228 having only suppletory effect, conformably with our ruling
in Paris v. Alfeche.[23] [13]
Id. at 178-192, 194-207.
Section 17 of RA 6657 which is particularly relevant, providing as it does the [14]
Gold Line Transit, Inc. v. Ramos, 415 Phil. 492 (2001).
guideposts for the determination of just compensation, reads as follows:
[15]
Supra note 8.
Sec. 17. Determination of Just Compensation.In determining just compensation, the [16]
Norris v. Parentela, Jr., 446 Phil. 462 (2003).
cost of acquisition of the land, the current value of like properties, its nature, actual
[17]
use and income, the sworn valuation by the owner, the tax declarations, and the Id. at 354.
assessment made by government assessors shall be considered. The social and [18]
economic benefits contributed by the farmers and the farm-workers and by the Rollo, pp. 38-39, Letter dated January 15, 1993 addressed to then DAR
Government to the property as well as the non-payment of taxes or loans secured Secretary Ernesto Garilao.
from any government financing institution on the said land shall be considered as [19]
379 Phil. 141, 147 (2000).
additional factors to determine its valuation.
[20]
Id. at 148. See also EPZA v. Dulay, No. L-59603, April 29, 1987, 149 SCRA
It would certainly be inequitable to determine just compensation based on the 305.
guideline provided by PD 27 and EO 228 considering the DARs failure to [21]
413 Phil. 711 (2001).
determine the just compensation for a considerable length of time. That just
compensation should be determined in accordance with RA 6657, and not PD 27 or [22]
Comprehensive Agrarian Reform Law of 1988.
EO 228, is especially imperative considering that just compensation should be the
full and fair equivalent of the property taken from its owner by the expropriator, the [23]
416 Phil. 473 (2001), citing Land Bank of the Philippines v. Court of Appeals,
equivalent being real, substantial, full and ample.[24] 321 SCRA 629.
In this case, the trial court arrived at the just compensation due private [24]
Association of Small Landowners in the Philippines, Inc. v. Secretary of
respondents for their property, taking into account its nature as irrigated land, Agrarian Reform, G.R. No. 78742, July 14, 1989, 175 SCRA 343.
location along the highway, market value, assessors value and the volume and value
of its produce. This Court is convinced that the trial court correctly determined the
amount of just compensation due private respondents in accordance with, and
guided by, RA 6657 and existing jurisprudence.

WHEREFORE, the petition is DENIED. Costs against petitioner.

SO ORDERED.

Puno, (Chairman), Austria-Martinez, Callejo, Sr., and Chico-Nazario,

JJ., concur.

[1]
Rollo, pp. 3-24.
[2]
Id. at 66-74.
[3]
Regional Trial Court, San Fernando, Pampanga, Branch 48.
[4]
Rollo, p. 74.
[5]
Id. at 92-94.
[6]
Id. at 99-102.
[7]
Id. at 103-112, Affidavits of Solomon B. Garcia, Clerk III of petitioner LBP, and
of Alfredo B. Pandico, Jr.

FIRST DIVISION
JOSEFINA S. LUBRICA, in her G.R. No. 170220
capacity as Assignee of FEDERICO
C. SUNTAY, NENITA SUNTAY
TAEDO and EMILIO A.M.
SUNTAY III,
Petitioners, Present:
Panganiban, C.J. (Chairperson),
- versus - Ynares-Santiago,
Austria-Martinez,
Callejo, Sr., and
Chico-Nazario, JJ.
LAND BANK OF THE PHILIPPINES,
Respondent. Promulgated:
November 20, 2006
x ---------------------------------------------------------------------------------------- x
DECISION
YNARES-SANTIAGO, J.:
This Petition for Review on Certiorari under Rule 45 of the Rules of
Court assails the October 27, 2005 Amended Decision [1] of the Court of Appeals in
CA-G.R. SP No. 77530, which vacated its May 26, 2004 Decision affirming (a) the
Order of the Regional Trial Court of San Jose, Occidental Mindoro, Branch 46,
acting as Special Agrarian Court, in Agrarian Case Nos. R-1339 and R-1340, dated
March 31, 2003 directing respondent Land Bank of the Philippines (LBP) to deposit
the provisional compensation as determined by the Provincial Agrarian Reform
Adjudicator (PARAD); (b) the May 26, 2003 Resolution denying LBPs motion for
reconsideration; and (c) the May 27, 2003 Order requiring Teresita V. Tengco, LBPs
Land Compensation Department Manager, to comply with the March 31, 2003
Order.
The facts of the case are as follows:
Petitioner Josefina S. Lubrica is the assignee [2] of Federico C. Suntay over certain
parcels of agricultural land located at Sta. Lucia, Sablayan, Occidental Mindoro,
with an area of 3,682.0285 hectares covered by Transfer Certificate of Title (TCT)
No. T-31 (T-1326)[3] of the Registry of Deeds of Occidental Mindoro. In 1972, a
portion of the said property with an area of 311.7682 hectares, was placed under the
land reform program pursuant to Presidential Decree No. 27 (1972)[4] and Executive
Order No. 228 (1987).[5] The land was thereafter subdivided and distributed to
farmer beneficiaries. The Department of Agrarian Reform (DAR) and the LBP fixed
the value of the land at P5,056,833.54 which amount was deposited in cash and
bonds in favor of Lubrica.
On the other hand, petitioners Nenita Suntay-Taedo and Emilio A.M. Suntay III
inherited from Federico Suntay a parcel of agricultural land located at Balansay,
Mamburao, Occidental Mindoro covered by TCT No. T-128[6] of the Register of
Deeds of Occidental Mindoro, consisting of two lots, namely, Lot 1 with an area of
45.0760 hectares and Lot 2 containing an area of 165.1571 hectares or a total of
210.2331 hectares. Lot 2 was placed under the coverage of P.D. No. 27 but only
128.7161 hectares was considered by LBP and valued the same at P1,512,575.05.
Petitioners rejected the valuation of their properties, hence the Office of the
Provincial Agrarian Reform Adjudicator (PARAD) conducted summary
administrative proceedings for determination of just compensation. On January 29,
2003, the PARAD fixed the preliminary just compensation at P51,800,286.43 for
the 311.7682 hectares (TCT No. T-31) and P21,608,215.28 for the 128.7161
hectares (TCT No. T-128).[7]
Not satisfied with the valuation, LBP filed on February 17, 2003, two separate
petitions[8] for judicial determination of just compensation before the Regional Trial
Court of San Jose, Occidental Mindoro, acting as a Special Agrarian Court,
docketed as Agrarian Case No. R-1339 for TCT No. T-31 and Agrarian Case No. R-
1340 for TCT No. T-128, and raffled to Branch 46 thereof.
Petitioners filed separate Motions to Deposit the Preliminary Valuation Under
Section 16(e) of Republic Act (R.A.) No. 6657 (1988) [9] and Ad Cautelam Answer
praying among others that LBP deposit the preliminary compensation determined
by the PARAD.
On March 31, 2003, the trial court issued an Order [10] granting petitioners motion,
the dispositive portion of which reads:
WHEREFORE, Ms. Teresita V. Tengco, of the Land
Compensation Department I (LCD I), Land Bank of the
Philippines, is hereby ordered pursuant to Section 16 (e) of
RA 6657 in relation to Section 2, Administrative Order No. 8,
Series of 1991, to deposit the provisional compensation as
determined by the PARAD in cash and bonds, as follows:
1. In Agrarian Case No. R-1339, the amount of P
51,800,286.43, minus the amount received by the
Landowner;
2. In Agrarian Case No. R-1340, the amount of P
21,608,215.28, less the amount of P 1,512,575.16,
the amount already deposited.
Such deposit must be made with the Land Bank of
the Philippines, Manila within five (5) days from receipt of a
copy of this order and to notify this court of her compliance
within such period.
Let this order be served by the Sheriff of this Court at the
expense of the movants.
SO ORDERED.[11]
LBPs motion for reconsideration was denied in a
Resolution[12] dated May 26, 2003. The following day, May 27, 2003, the trial court
[13]
issued an Order directing Ms. Teresita V. Tengco, LBPs Land Compensation
Department Manager, to deposit the amounts.
Thus, on June 17, 2003, LBP filed with the Court of Appeals a Petition for
Certiorari and Prohibition under Rule 65 of the Rules of Court with application for
the issuance of a Temporary Restraining Order and Writ of Preliminary Injunction
docketed as CA-G.R. SP No. 77530.[14]
On June 27, 2003, the appellate court issued a 60-day temporary restraining
order[15] and on October 6, 2003, a writ of preliminary injunction.[16]
On May 26, 2004, the Court of Appeals rendered a Decision [17] in favor of the
petitioners, the dispositive portion of which reads:
WHEREFORE, premises considered, there being no grave
abuse of discretion, the instant Petition for Certiorari and
Prohibition is DENIED. Accordingly, the Order dated March
31, 2003, Resolution dated May 26, 2003, and Order
dated May 27, 2003 are hereby AFFIRMED. The preliminary
injunction We previously issued is hereby LIFTED and
DISSOLVED.
SO ORDERED.[18]
The Court of Appeals held that the trial court correctly ordered LBP to deposit the
amounts provisionally determined by the PARAD as there is no law which prohibits
LBP to make a deposit pending the fixing of the final amount of just
compensation. It also noted that there is no reason for LBP to further delay the
deposit considering that the DAR already took possession of the properties and
distributed the same to farmer-beneficiaries as early as 1972.
LBP moved for reconsideration which was granted. On October 27, 2005, the
appellate court rendered the assailed Amended Decision,[19] the dispositive portion
of which reads:
Wherefore, in view of the prescription of a different formula
in the case of Gabatin which We hold as cogent and
compelling justification necessitating Us to effect the reversal
of Our judgment herein sought to be reconsidered, the instant
Motion for Reconsideration is GRANTED, and Our May 26,
2004 Decision is hereby VACATED and ABANDONED with
the end in view of giving way to and acting in harmony and
in congruence with the tenor of the ruling in the case of
Gabatin. Accordingly, the assailed rulings of the Special
Agrarian Court is (sic) commanded to compute and fix the
just compensation for the expropriated agricultural lands
strictly in accordance with the mode of computation
prescribed (sic) Our May 26, 2004 judgment in the case of
Gabatin.
SO ORDERED.[20]
In the Amended Decision, the Court of Appeals held that the immediate deposit of
the preliminary value of the expropriated properties is improper because it was
erroneously computed. Citing Gabatin v. Land Bank of the Philippines,[21] it held
that the formula to compute the just compensation should be: Land Value = 2.5 x
Average Gross Production x Government Support Price.Specifically, it held that the
value of the government support price for the corresponding agricultural produce
(rice and corn) should be computed at the time of the legal taking of the subject
agricultural land, that is, on October 21, 1972 when landowners were effectively
deprived of ownership over their properties by virtue of P.D. No. 27. According to
the Court of Appeals, the PARAD incorrectly used the amounts of P500 and P300
which are the prevailing government support price for palay and corn, respectively,
at the time of payment, instead of P35 and P31, the prevailing government support
price at the time of the taking in 1972.
Hence, this petition raising the following issues:
A. THE COURT A QUO HAS DECIDED THE CASE IN A
WAY NOT IN ACCORD WITH THE LATEST DECISION
OF THE SUPREME COURT IN THE CASE OF LAND
BANK OF THE PHILIPPINES VS. HON. ELI G.C.
NATIVIDAD, ET AL., G.R. NO. 127198, PROM. MAY 16,
2005; and[22]
B. THE COURT A QUO HAS, WITH GRAVE GRAVE
ABUSE OF DISCRETION, SO FAR DEPARTED FROM
THE ACCEPTED AND USUAL COURSE OF JUDICIAL
PROCEEDINGS, DECIDING ISSUES THAT HAVE NOT
BEEN RAISED, AS TO CALL FOR AN EXERCISE OF
THE POWER OF SUPERVISION.[23]
Petitioners insist that the determination of just compensation should be based on the
value of the expropriated properties at the time of payment. Respondent LBP, on the
other hand, claims that the value of the realties should be computed as of October
21, 1972when P.D. No. 27 took effect.
The petition is impressed with merit.
In the case of Land Bank of the Philippines v. Natividad,[24] the Court ruled thus:
Land Banks contention that the property was
acquired for purposes of agrarian reform on October 21,
1972, the time of the effectivity of PD 27, ergo just
compensation should be based on the value of the property as
of that time and not at the time of possession in 1993, is
likewise erroneous. In Office of the President,
Malacaang, Manila v. Court of Appeals, we ruled that the
seizure of the landholding did not take place on the date of
effectivity of PD 27 but would take effect on the payment of
just compensation.
The Natividad case reiterated the Courts ruling in Office of the President
v. Court of Appeals[25] that the expropriation of the landholding did not take place on
the effectivity of P.D. No. 27 on October 21, 1972 but seizure would take effect on
the payment of just compensation judicially determined.
Likewise, in the recent case of Heirs of Francisco R. Tantoco, Sr. v.
Court of Appeals,[26] we held that expropriation of landholdings covered by R.A.
No. 6657 take place, not on the effectivity of the Act on June 15, 1988, but on the
payment of just compensation.
In the instant case, petitioners were deprived of their properties in 1972
but have yet to receive the just compensation therefor.The parcels of land were
already subdivided and distributed to the farmer-beneficiaries thereby immediately
depriving petitioners of their use. Under the circumstances, it would be highly
inequitable on the part of the petitioners to compute the just compensation using the
values at the time of the taking in 1972, and not at the time of the payment,
considering that the government and the farmer-beneficiaries have already benefited
from the land although ownership thereof have not yet been transferred in their
names.Petitioners were deprived of their properties without payment of just
compensation which, under the law, is a prerequisite before the property can be
taken away from its owners.[27] The transfer of possession and ownership of the land
to the government are conditioned upon the receipt by the landowner of the
corresponding payment or deposit by the DAR of the compensation with an
accessible bank. Until then, title remains with the landowner.[28]
Our ruling in Association of Small Landowners in the Philippines, Inc. v.
Secretary of Agrarian Reform[29] is instructive, thus:
It is true that P.D. No. 27 expressly ordered the
emancipation of tenant-farmer as October 21, 1972 and
declared that he shall be deemed the owner of a portion of
land consisting of a family-sized farm except that no title to
the land owned by him was to be actually issued to him
unless and until he had become a full-fledged member of a
duly recognized farmers cooperative. It was understood,
however, that full payment of the just compensation also had
to be made first, conformably to the constitutional
requirement.
When E.O. No. 228, categorically stated in its
Section 1 that:
All qualified farmer-beneficiaries are
now deemed full owners as of October
21, 1972 of the land they acquired by
virtue of Presidential Decree No. 27
(Emphasis supplied.)
it was obviously referring to lands already validly acquired
under the said decree, after proof of full-fledged membership
in the farmers cooperatives and full payment of just
compensation. x x x
The CARP Law, for its part, conditions the transfer of
possession and ownership of the land to the government on
receipt by the landowner of the corresponding payment or the
deposit by the DAR of the compensation in cash or LBP
bonds with an accessible bank.Until then, title also remains
with the landowner. No outright change of ownership is
contemplated either.
We also note that the expropriation proceedings in the instant case was
initiated under P.D. No. 27 but the agrarian reform process is still incomplete
considering that the just compensation to be paid to petitioners has yet to be
settled. Considering the passage of R.A. No. 6657 before the completion of this
process, the just compensation should be determined and the process concluded
under the said law. Indeed, R.A. No. 6657 is the applicable law, with P.D. No. 27
and E.O. No. 228 having only suppletory effect.[30]
In Land Bank of the Philippines v. Court of Appeals,[31] we held that:
RA 6657 includes PD 27 lands among the
properties which the DAR shall acquire and distribute to the
landless. And to facilitate the acquisition and distribution
thereof, Secs. 16, 17 and 18 of the Act should be adhered to.
Section 18 of R.A. No. 6657 mandates that the LBP shall compensate
the landowner in such amount as may be agreed upon by the landowner and the
DAR and the LBP or as may be finally determined by the court as the just
 [12]
compensation for the land. In determining just compensation, the cost of the MA. ALICIA AUSTRIA-MARTINEZ ROMEO J. CALLEJO, SR. Id. at 55-62.
acquisition of the land, the current value of like properties, its nature, actual use and
income, the sworn valuation by the owner, the tax declarations, and the assessment Associate Justice Associate Justice [13]
made by government assessors shall be considered. The social and economic Id. at 63-64.
benefits contributed by the farmers and the farmworkers and by the government to MINITA V. CHICO-NAZARIO
the property as well as the nonpayment of taxes or loans secured from any [14]
Id. at 2-50.
government financing institution on the said land shall be considered as additional Associate Justice
factors to determine its valuation.[32]
[15]
CERTIFICATION Id. at 220-222.
Corollarily, we held in Land Bank of the Philippines v. Celada[33] that the
above provision was converted into a formula by the DAR through Administrative Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the [16]
Order No. 05, S. 1998, to wit: Id. at 355-356.
conclusions in the above Decision were reached in consultation before the case was
assigned to the writer of the opinion of the Courts Division.
Land Value (LV) = (Capitalized Net Income x 0.6) + (Comparable Sales [17]
Id. at 481-491.
x 0.3) + (Market Value per Tax Declaration x 0.1) ARTEMIO V. PANGANIBAN
[18]
Petitioners were deprived of their properties way back in 1972, yet to date, they Id. at 490-491.
Chief Justice
have not yet received just compensation. Thus, it would certainly be inequitable to
determine just compensation based on the guideline provided by P.D. No. 227 and [19]
Id. at 514-518.
E.O. No. 228 considering the failure to determine just compensation for a
considerable length of time. That just compensation should be determined in
accordance with R.A. No. 6657 and not P.D. No. 227 or E.O. No. 228, is important [1]
Rollo, pp. 30-35. Penned by Associate Justice Rosmari D. Carandang and
[20]
Rollo, p. 34.
considering that just compensation should be the full and fair equivalent of the
concurred in by Associate Justices Godardo A. Jacinto and Elvi John S. Asuncion.
property taken from its owner by the expropriator, the equivalent being real, [21]
substantial, full and ample.[34] G.R. No. 148223, November 25, 2004, 444 SCRA 176.
[2]
CA rollo, p. 157.
[22]
Rollo, p. 18.
[3]
WHEREFORE, premises considered, the petition is GRANTED. The assailed Id. at 65-88.
[23]
Amended Decision dated October 27, 2005 of the Court of Appeals in CA-G.R. SP Id. at 22.
No. 77530 is REVERSED and SET ASIDE. The Decision dated May 26, 2004 of [4]
DECREEING THE EMANCIPATION OF TENANTS FROM THE
the Court of Appeals affirming (a) the March 31, 2003 Order of the Special
BONDAGE OF THE SOIL, TRANSFERRING TO THEM THE OWNERSHIP [24]
G.R. No. 127198, May 16, 2005, 458 SCRA 441, 451.
Agrarian Court ordering the respondent Land Bank of the Philippines to deposit the
just compensation provisionally determined by the PARAD; (b) the May 26, 2003 OF THE LAND THEY TILL AND PROVIDING THE INSTRUMENTS AND
Resolution denying respondents Motion for Reconsideration; and (c) the May 27, MECHANISM THEREFOR. [25]
413 Phil. 711 (2001).
2003 Order directing Teresita V. Tengco, respondents Land Compensation
Department Manager to comply with the March 31, 2003 Order, [5]
is REINSTATED. The Regional Trial Court of San Jose, Occidental Mindoro, DECLARING FULL LAND OWNERSHIP TO QUALIFIED FARMER [26]
G.R. No. 149621, May 5, 2006, SC E-Library.
Branch 46, acting as Special Agrarian Court is ORDERED to proceed with BENEFICIARIES COVERED BY PRESIDENTIAL DECREE NO. 27:
dispatch in the trial of Agrarian Case Nos. R-1339 and R-1340, and to compute the DETERMINING THE VALUE OF REMAINING UNVALUED RICE [27]
final valuation of the subject properties based on the aforementioned formula. Id.
AND CORN LANDS SUBJECT TO P.D. NO. 27; AND PROVIDING FOR
THE MANNER OF PAYMENT BY THE FARMER BENEFICIARY AND
SO ORDERED. [28]
Roxas & Co., Inc. v. Court of Appeals, 378 Phil. 727, 755 (1999).
MODE OF COMPENSATION TO THE LANDOWNER.
CONSUELO YNARES-SANTIAGO [29]
[6]
G.R. Nos. 78742, 79310, 79744 & 79777, July 14, 1989, 175 SCRA 343, 390-
CA rollo, pp. 89-95.
Associate Justice 391.

[7]
WE CONCUR: Id. at 96-118. [30]
Land Bank of the Philippines v. Natividad, supra note 24 at 451-452; Paris v.
Alfeche, 416 Phil. 473, 488 (2001); Land Bank of the Philippines v. Court of
[8]
Id. at 119-133. Appeals, 378 Phil. 1248, 1260-1261.

[9]
Comprehensive Agrarian Reform Law of 1988. [31]
Id. at 1261.
ARTEMIO V. PANGANIBAN
[10]
CA rollo, pp. 51-54. Penned by Judge Ernesto P. Pagayatan. [32]
Republic Act No. 6657 (1988), Sec. 17.
Chief Justice

Chairperson [11]
Id. at 53-54. [33]
G.R. No. 164876, January 23, 2006, 479 SCRA 495, 508-509.
[34]
Land Bank of the Philippines v. Natividad, supra note 24 at 452,
citing Association of Small Landowners in the Philippines, Inc. v. Secretary of
Agrarian Reform, supra note 29. G.R. No. 118712 October 6, 1995

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. 118745 October 6, 1995

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.

FRANCISCO, R., J.:

It has been declared that the duty of the court to protect the weak and the
underprivileged should not be carried out to such an extent as deny justice to the
landowner whenever truth and justice happen to be on his side. 1 As eloquently
stated by Justice Isagani Cruz:

. . . social justice or any justice for that matter is for the

deserving, whether he be a millionaire in his mansion or a
pauper in his hovel. It is true that, in case of reasonable
doubt, we are called upon to tilt the balance in favor of the
poor, to whom the Constitution fittingly extends its sympathy
and compassion. But never is it justified to prefer the poor
simply because they are poor, or to reject the rich simply
because they are rich, for justice must always be served, for
poor and rich alike, according to the mandate of the law. 2

In this agrarian dispute, it is once more imperative that the aforestated principles be
applied in its resolution.

Separate petitions for review were filed by petitioners Department of Agrarian

Reform (DAR) (G.R. No. 118745) and Land Bank of the Philippines (G.R. No.
118712) following the adverse ruling by the Court of Appeals in CA-G.R. SP No.
Republic of the Philippines 33465. However, upon motion filed by private respondents, the petitions were
SUPREME COURT ordered consolidated.3
Manila

SECOND DIVISION
Petitioners assail the decision of the Court of Appeals promulgated on October 20,
1994, which granted private respondents' Petition for Certiorari and Mandamus and
ruled as follows:
WHEREFORE, premises considered, the Petition
for Certiorari and Mandamus is hereby GRANTED:
a) DAR Administrative Order No. 9,
Series of 1990 is
declared null and void insofar as it
provides for the opening of trust
accounts in lieu of deposits in cash or
bonds;
b) Respondent Landbank is ordered
to immediately deposit not merely
"earmark", "reserve" or "deposit in
trust" with an accessible bank
designated by respondent DAR in the
names of the following petitioners the
following amounts in cash and in
government financial instruments
within the parameters of Sec. 18 (1) of
RA 6657:
P 1,455,207.31 Pedro L. Yap
P 135,482.12 Heirs of Emiliano
Santiago
P 15,914,127.77 AMADCOR;
c) The DAR-designated bank is
ordered to allow the petitioners to
withdraw the above-deposited amounts
without prejudice to the final
determination of just compensation by
the proper authorities; and
d) Respondent DAR is ordered to
1) immediately conduct summary admi
nistrative proceedings to determine the
just compensation for the lands of the
petitioners giving the petitioners 15
days from notice within which to
submit evidence and to 2) decide the
cases within 30 days after they are
submitted for decision. 4
Likewise, petitioners seek the reversal of the Resolution dated January
18, 1995, 5 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, Republic Act No. 6657).
Aggrieved by the alleged lapses of the DAR and the Landbank with
respect to the valuation and payment of compensation for their land
pursuant to the provisions of RA 6657, private respondents filed with
this Court a Petition for Certiorari and Mandamus with prayer for
preliminary mandatory injunction. Private respondents questioned the
validity of DAR Administrative Order No. 6, Series of 1992 6 and DAR
Administrative Order No. 9, Series of 1990, 7 and sought to compel the
DAR to expedite the pending summary administrative proceedings to
finally determine the just compensation of their properties, and the
Landbank to deposit in cash and bonds the amounts respectively
"earmarked", "reserved" and "deposited in trust accounts" for private
respondents, and to allow them to withdraw the same.
Through a Resolution of the Second Division dated February 9, 1994, this Court
referred the petition to respondent Court of Appeals for proper determination and
disposition.
As found by respondent court , the following are undisputed:
Petitioner Pedro Yap alleges that "(o)n 4 September 1992 the
transfer certificates of title (TCTs) of petitioner Yap were
totally cancelled by the Registrar of Deeds of Leyte and were
transferred in the names of farmer beneficiaries collectively,
based on the request of the DAR together with a certification
of the Landbank that the sum of P735,337.77 and
P719,869.54 have been earmarked for Landowner Pedro L.
Yap for the parcels of lands covered by TCT Nos. 6282 and
6283, respectively, and issued in lieu thereof TC-563 and TC-
562, respectively, in the names of listed beneficiaries
(ANNEXES "C" & "D") without notice to petitioner Yap and
without complying with the requirement of Section 16 (e) of
RA 6657 to deposit the compensation in cash and Landbank
bonds in an accessible bank. (Rollo, p. 6).
The above allegations are not disputed by any of the
respondents.
Petitioner Heirs of Emiliano Santiago allege that the heirs of
Emiliano F. Santiago are the owners of a parcel of land
located at Laur, NUEVA ECIJA with an area of 18.5615
hectares covered by TCT No. NT-60359 of the registry of
Deeds of Nueva Ecija, registered in the name of the late
Emiliano F. Santiago; that in November and December 1990,
without notice to the petitioners, the Landbank required and
the beneficiaries executed Actual tillers Deed of Undertaking
(ANNEX "B") to pay rentals to the LandBank for the use of
their farmlots equivalent to at least 25% of the net harvest;
that on 24 October 1991 the DAR Regional Director issued
an order directing the Landbank to pay the landowner
directly or through the establishment of a trust fund in the
amount of P135,482.12, that on 24 February 1992, the
Landbank reserved in trust P135,482.12 in the name of
Emiliano F. Santiago. (ANNEX "E"; Rollo,
p. 7); that the beneficiaries stopped paying rentals to the
landowners after they signed the Actual Tiller's Deed of
Undertaking committing themselves to pay rentals to the
LandBank (Rollo, p. 133).
The above allegations are not disputed by the respondents
except that respondent Landbank claims 1) that it was
respondent DAR, not Landbank which required the execution
of Actual Tillers Deed of Undertaking (ATDU, for brevity);
and 2) that respondent Landbank, although armed with the
ATDU, did not collect any amount as rental from the
substituting beneficiaries (Rollo, p. 99).
Petitioner Agricultural Management and Development
Corporation (AMADCOR, for brevity) alleges with respect
to its properties located in San Francisco, Quezon that the
properties of AMADCOR in San Francisco, Quezon consist
of a parcel of land covered by TCT No. 34314 with an area of
209.9215 hectares and another parcel covered by TCT No.
10832 with an area of 163.6189 hectares; that a summary
administrative proceeding to determine compensation of the
property covered by TCT No. 34314 was conducted by the
DARAB in Quezon City without notice to the landowner;
that a decision was rendered on 24 November 1992 (ANNEX
"F") fixing the compensation for the parcel of land covered
by TCT No. 34314 with an area of 209.9215 hectares at
P2,768,326.34 and ordering the Landbank to pay or establish
a trust account for said amount in the name of AMADCOR;
and that the trust account in the amount of P2,768,326.34
fixed in the decision was established by adding
P1,986,489.73 to the first trust account established on 19
December 1991 (ANNEX "G"). With respect to petitioner
AMADCOR's property in Tabaco, Albay, it is alleged that the
property of AMADCOR in Tabaco, Albay is covered by TCT
No. T-2466 of the Register of Deeds of Albay with an area of
1,629.4578 hectares'; that emancipation patents were issued
covering an area of 701.8999 hectares which were registered
on 15 February 1988 but no action was taken thereafter by
the DAR to fix the compensation for said land; that on 21
April 1993, a trust account in the name of AMADCOR was
established in the amount of P12,247,217.83', three notices of
acquisition having been previously rejected by AMADCOR.
(Rollo, pp. 8-9)
 The above allegations are not disputed by the respondents
except that respondent Landbank claims that petitioner failed
to participate in the DARAB proceedings (land valuation
case) despite due notice to it (Rollo, p. 100). 8
Private respondents argued that Administrative Order No. 9, Series of 1990 was
issued without jurisdiction and with grave abuse of discretion because it permits the
opening of trust accounts by the Landbank, in lieu of depositing in cash or bonds in
an accessible bank designated by the DAR, the compensation for the land before it
is taken and the titles are cancelled as provided under Section 16(e) of RA
6657. 9 Private respondents also assail the fact that the DAR and the Landbank
merely "earmarked", "deposited in trust" or "reserved" the compensation in their
names as landowners despite the clear mandate that before taking possession of the
property, the compensation must be deposited in cash or in bonds. 10
Petitioner DAR, however, maintained that Administrative Order No. 9 is a valid
exercise of its rule-making power pursuant to Section 49 of RA 6657. 11 Moreover,
the DAR maintained that the issuance of the "Certificate of Deposit" by the
Landbank was a substantial compliance with Section 16(e) of RA 6657 and the
ruling in the case of Association of Small Landowners in the Philippines, Inc., et
al. vs. Hon. Secretary of Agrarian Reform, G.R. No. 78742, July 14, 1989 (175
SCRA 343). 12
For its part, petitioner Landbank declared that the issuance of the Certificates of
Deposits was in consonance with Circular Nos. 29, 29-A and 54 of the Land
Registration Authority where the words "reserved/deposited" were also used. 13
On October 20, 1994, the respondent court rendered the assailed decision in favor
of private respondents. 14Petitioners filed a motion for reconsideration but
respondent court denied the same. 15
Hence, the instant petitions.
On March 20, 1995, private respondents filed a motion to dismiss the petition in
G.R. No. 118745 alleging that the appeal has no merit and is merely intended to
delay the finality of the appealed decision. 16 The Court, however, denied the motion
and instead required the respondents to file their comments. 17
Petitioners submit that respondent court erred in (1) declaring as null and void DAR
Administrative Order No. 9, Series of 1990, insofar as it provides for the opening of
trust accounts in lieu of deposit in cash or in bonds, and (2) in holding that private
respondents are entitled as a matter of right to the immediate and provisional
release of the amounts deposited in trust pending the final resolution of the cases it
has filed for just compensation.
Anent the first assignment of error, petitioners maintain that the word "deposit" as
used in Section 16(e) of RA 6657 referred merely to the act of depositing and in no
way excluded the opening of a trust account as a form of deposit. Thus, in opting
for the opening of a trust account as the acceptable form of deposit through
Administrative Circular No. 9, petitioner DAR did not commit any grave abuse of
discretion since it merely exercised its power to promulgate rules and regulations in
implementing the declared policies of RA 6657.
The contention is untenable. Section 16(e) of RA 6657 provides as follows:
Sec. 16. Procedure for Acquisition of Private Lands
xxx xxx xxx
(e) Upon receipt by the landowner of the corresponding
payment or, in case of rejection or no response from the
landowner, upon the deposit with an accessible bank
designated by the DAR of the compensation in cash or in
LBP bonds in accordance with this Act, the DAR shall take
immediate possession of the land and shall request the proper
Register of Deeds to issue a Transfer Certificate of Title
(TCT) in the name of the Republic of the Philippines. . . .
(emphasis supplied)
It is very explicit therefrom that the deposit must be made only in "cash" or in "LBP
bonds". Nowhere does it appear nor can it be inferred that the deposit can be made
in any other form. If it were the intention to include a "trust account" among the
valid modes of deposit, that should have been made express, or at least, qualifying
words ought to have appeared from which it can be fairly deduced that a "trust
account" is allowed. In sum, there is no ambiguity in Section 16(e) of RA 6657 to
warrant an expanded construction of the term "deposit".
The conclusive effect of administrative construction is not absolute. Action of an
administrative agency may be disturbed or set aside by the judicial department if
there is an error of law, a grave abuse of power or lack of jurisdiction or grave
abuse of discretion clearly conflicting with either the letter or the spirit of a
legislative enactment. 18 In this regard, it must be stressed that the function of
promulgating rules and regulations may be legitimately exercised only for the
purpose of carrying the provisions of the law into effect. The power of
administrative agencies is thus confined to implementing the law or putting it into
effect. Corollary to this is that administrative regulations cannot extend
the law and amend a legislative enactment, 19 for settled is the rule that
administrative regulations must be in harmony with the provisions of the law. And
in case there is a discrepancy between the basic law and an implementing rule or
regulation, it is the former that prevails. 20
In the present suit, the DAR clearly overstepped the limits of its power to enact
rules and regulations when it issued Administrative Circular No. 9. There is no basis
in allowing the opening of a trust account in behalf of the landowner as
compensation for his property because, as heretofore discussed, Section 16(e) of
RA 6657 is very specific that the deposit must be made only in "cash" or in "LBP
bonds". In the same vein, petitioners cannot invoke LRA Circular Nos. 29, 29-A
and 54 because these implementing regulations cannot outweigh the clear provision
of the law. Respondent court therefore did not commit any error in striking down
Administrative Circular No. 9 for being null and void.
Proceeding to the crucial issue of whether or not private respondents are entitled to
withdraw the amounts deposited in trust in their behalf pending the final resolution
of the cases involving the final valuation of their properties, petitioners assert the
negative.
The contention is premised on the alleged distinction between the deposit of
compensation under Section 16(e) of RA 6657 and payment of final compensation
as provided under Section 18 21 of the same law. According to petitioners, the right
of the landowner to withdraw the amount deposited in his behalf pertains only to
the final valuation as agreed upon by the landowner, the DAR and the LBP or that
adjudged by the court. It has no reference to amount deposited in the trust account
pursuant to Section 16(e) in case of rejection by the landowner because the latter
amount is only provisional and intended merely to secure possession of the property
pending final valuation. To further bolster the contention petitioners cite the
following pronouncements in the case of "Association of Small Landowners in the
Phil. Inc. vs. Secretary of Agrarian Reform". 22
The last major challenge to CARP is that the landowner is
divested of his property even before actual payment to him in
full of just compensation, in contravention of a well-accepted
principle of eminent domain.
xxx xxx xxx
The CARP Law, for its part conditions the transfer of
possession and ownership of the land to the government on
receipt by the landowner of the corresponding payment or the
deposit by the DAR of the compensation in cash or LBP
bonds with an accessible bank. Until then, title also remains
with the landowner. No outright change of ownership is
contemplated either.
xxx xxx xxx
Hence the argument that the assailed measures violate due
process by arbitrarily transferring title before the land is fully
paid for must also be rejected.
Notably, however, the aforecited case was used by respondent court in discarding
petitioners' assertion as it found that:
. . . despite the "revolutionary" character of the expropriation
envisioned under RA 6657 which led the Supreme Court, in
the case of Association of Small Landowners in the Phil. Inc.
vs. Secretary of Agrarian Reform (175 SCRA 343), to
conclude that "payments of the just compensation is not
always required to be made fully in money" even as the
Supreme Court admits in the same case "that the traditional
medium for the payment of just compensation is money and
no other" the Supreme Court in said case did not abandon
 the "recognized rule . . . that title to the property on the rights of property owners, who under our Constitution and laws are also request the proper Register of Deeds to issue a
expropriated shall pass from the owner to the expropriator entitled to protection. 26 Transfer Certificate of Title (TCT) in the name of
only upon full payment of the just the Republic of the Philippines. The DAR shall
compensation." 23(Emphasis supplied) WHEREFORE, the foregoing premises considered, the petition is hereby DENIED thereafter proceed with the redistribution of the
for lack of merit and the appealed decision is AFFIRMED in toto. land to the qualified beneficiaries.
We agree with the observations of respondent court. The ruling in the "Association"
case merely recognized the extraordinary nature of the expropriation to be SO ORDERED. 10 Rollo, p. 111.
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, 11 Sec. 49. Rules and Regulations. The PARC
however, dispense with the settled rule that there must be full payment of just Regalado, Puno and Mendoza, JJ., concur.
and the DAR shall have the power to issue rules
compensation before the title to the expropriated property is transferred. and regulations, whether substantive or
Narvasa, C.J., is on leave. procedural, to carry out the objects and purposes
The attempt to make a distinction between the deposit of compensation under of this Act. Said rules shall take effect ten (l0)
Section 16(e) of RA 6657 and determination of just compensation under Section 18 Footnotes days after the publication in two (2) national
is unacceptable. To withhold the right of the landowners to appropriate the amounts newspapers of general circulation.
already deposited in their behalf as compensation for their properties simply 1 Gelos v. Court of Appeals, 208 SCRA 608. 615
because they rejected the DAR's valuation, and notwithstanding that they have (1992), quoting Justice Alicia Sempio-Diy. 12 Rollo, pp. 111-112.
already been deprived of the possession and use of such properties, is an oppressive
exercise of eminent domain. The irresistible expropriation of private respondents'
properties was painful enough for them. But petitioner DAR rubbed it in all the 2 Ibid, p. 616. 13 Rollo, p. 112.
more by withholding that which rightfully belongs to private respondents in
exchange for the taking, under an authority (the "Association" case) that is, 3 Rollo, p. 7. 14 Rollo, p. 107.
however, misplaced. This is misery twice bestowed on private respondents, which
the Court must rectify. 4 Rollo, pp. 122-123. 15 Rollo, p. 149.

Hence, we find it unnecessary to distinguish between provisional compensation 5 Rollo, p. 149. 16 Rollo, p. 63.
under Section 16(e) and final compensation under Section 18 for purposes of
exercising the landowners' right to appropriate the same. The immediate effect in
6 which provides formulas for the valuation of 17 Rollo, p. 67.
both situations is the same, the landowner is deprived of the use and possession of
land expropriated under RA 6657.
his property for which he should be fairly and immediately compensated. Fittingly,
we reiterate the cardinal rule that: 18 Peralta vs. Civil Service Commission 212
7 which provides for the opening of trust accounts SCRA 425, 432 (1992).
in the Land Bank instead of depositing in an
. . . within the context of the State's inherent power of
accessible bank, in cash and bonds, the 19 Toledo vs. Civil Service Commission 202
eminent domain, just compensation means not only the
compensation for land expropriated by the DAR. SCRA 507, 54 (1991) citing Teoxon v. Members
correct determination of the amount to be paid to the owner
of the land but also the payment of the land within a of the Board of Administrators, Philippine
reasonable time from its taking. Without prompt 8 Rollo, pp. 109-111. Veterans Administration, 33 SCRA 585, 589
payment, compensation cannot be considered "just" for the (1970), citing Santos vs. Estenzo, 109 Phil. 419
property owner is made to suffer the consequence of being 9 Sec. 16. Procedure for Acquisition of Private (1960); Animos vs. Phil. Veterans Affairs Office,
immediately deprived of his land while being made to wait Lands. For purposes of acquisition of private 174 SCRA 214, 223-224 (1989).
for a decade or more before actually receiving the amount lands, the following shall be followed:
necessary to cope with his loss. 24 (Emphasis supplied) 20 Shell Philippines, Inc. vs. Central Bank of the
xxx xxx xxx Philippines, 162 SCRA 628 (1988).
The promulgation of the "Association" decision endeavored to remove all legal
obstacles in the implementation of the Comprehensive Agrarian Reform Program 21 Sec. 18. Valuation and Mode of Compensation.
(e) Upon receipt by the landowner of the
and clear the way for the true freedom of the farmer. 25 But despite this, cases The LBP shall compensate the landowner in
corresponding payment or, in case of rejection or
involving its implementation continue to multiply and clog the courts' dockets. such amount as may be agreed upon by the
no response from the landowner, upon the deposit
Nevertheless, we are still optimistic that the goal of totally emancipating the landowner and the DAR and LBP in accordance
with an accessible bank designated by the DAR of
farmers from their bondage will be attained in due time. It must be stressed, with the criteria provided for in Sections 16 and
the compensation in cash or in LBP bonds in
however, that in the pursuit of this objective, vigilance over the rights of the 17 and other pertinent provisions hereof, or as
accordance with this Act, the DAR shall take
landowners is equally important because social justice cannot be invoked to trample
immediate possession of the land and shall
may be finally determined by the court as the just
compensation for the land.

22 175 SCRA 343.

23 Decision, Court of Appeals, p. 14.

24 Municipality of Makati vs. Court of Appeals,

190 SCRA 207, 213 (1990) citing Cosculluela vs.
The Hon. Court of Appeals, 164 SCRA 393, 400
(1988); Provincial Government of Sorsogon vs.
Vda. de Villaroya, 153 SCRA 291, 302 (1987).

25 175 SCRA 343, 392.

26 Mata vs. Court of Appeals, 207 SCRA 748,

753 (1992).

Republic of the Philippines

SUPREME COURT
Manila
FIRST DIVISION ROCHA, FERNANDO C. RUFINO, PATERNO P. SAIN, CLAUDIO S.
SAYSON, and JOEMARIE VIBO, Petitioners, (in hectares)
vs.
G.R. No. 159674 June 30, 2006 Lot No. 1620, Pls 4 28.52
DEPARTMENT OF AGRARIAN REFORM and HACIENDA MARIA,
INC., Respondents.
SAMUEL ESTRIBILLO, CALIXTO P. ABAYATO, JR., RONGIE D. Lot No. 1621, Pls 4 11.64
AGUILAR, TACIANA D. AGUILAR, ARTEMIO G. DE JUAN,
DECISION
Lot No. 1622, Pls 4 487.47
Areas
Petitioners TCT/EP Nos.
(has.)
CHICO-NAZARIO, J.: TOTAL 527.834
1. SAMUEL ESTRIBILLO TCT No. T-287/EP No. A-037675 1.7833
This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court,
2. CALIXTO P. ABAYATO, JR. TCT No. T-297/EP No. A-037814 2.0000 seeking the review and reversal of the Resolutions1 of the Court of Appeals dated 27 On 21 October 1972, Presidential Decree No. 27 5 was issued mandating that
TCT No. T-829/EP No. A-027293 0.1565
January 2003 and 28 August 2003, respectively. tenanted rice and corn lands be brought under Operation Land Transfer and
awarded to farmer-beneficiaries.
3. RONGIE D. AGUILAR TCT No. T-913/EP No. A-027295 3.1441
The factual and procedural antecedents are as follows:
4. TACIANA D. AGUILAR TCT No. T-944/EP No. A-027296 4.2405 HMI, through a certain Joaquin Colmenares, requested that 527.8308 hectares of its
landholdings be placed under the coverage of Operation Land Transfer. Receiving
5. ARTEMIO G. DE JUAN TCT No. T-302/EP No. A-037809 3.3082 The petitioners, with the exception of two, are the recipients of Emancipation
compensation therefor, HMI allowed petitioners and other occupants to cultivate the
Patents (EPs) over parcels of land located at Barangay Angas, Sta. Josefa, Agusan
landholdings so that the same may be covered under said law.
6. ESTANISLAO DELA CRUZ, SR. TCT No. T-290/EP No. A-035676 3.1437 del Sur, with their respective Transfer Certificate of Title (TCT) and EP numbers
presented below:
7. EDGAR DUENAS TCT No. T-949/EP No. A-037658 4.0128 In 1973, the Department of Agrarian Reform (DAR) conducted a parcellary
mapping of the entire landholdings of 527.8308 hectares covered by OCT No. P-
look table
8. MARIO P. ERIBAL TCT No. T-952/EP No. A-037836 2.3087 3077-1661. In 1975 and 1976, the DAR approved the Parcellary Map Sketching
(PMS) and the Amended PMS covering the entire landholdings.
9. REYNALDO C. ESENCIA TCT No. T-950/EP No. A-037844 2.0950
The two other petitioners, Emma Gonzaga and Ana Patio, are the surviving
spouses of deceased recipients of EPs over parcels of land also located at Barangay
10. RUBEN A. IBOJO TCT No. T-928/EP No. A-037873 1.5737 HMI, through its representatives, actively participated in all relevant proceedings,
Angas, Sta. Josefa, Agusan del Sur, with their corresponding TCT and EP numbers
including the determination of the Average Gross Production per hectare at the
11. SAMUEL JAMANDRE TCT No. T-909/EP No. A-159348 2.2670 Barangay Committee on Land Production, and was a signatory of an undated
(Deceased) Registered Areas Landowner and Tenant Production Agreement (LTPA), covering the 527.8308
TCT/EP Nos.
12. HILARION V. LANTIZA TCT No. T-288/EP No. A-037674 4.5526 Owners (has.) hectares. The LTPA was submitted to the Land Bank of the Philippines (LBP) in
TCT No. T-401/EP No. A-037825 0.4579
1977.
1. MANUEL S.
TCT No. T-920/EP No. A-037832 4.1953
13. ANSELMO LOPEZ TCT No. T-973/EP No. A-037840 4.4939 GONZAGA
Also in 1977, HMI executed a Deed of Assignment of Rights in favor of petitioners,
14. TERESITA NACION TCT No. T-900/EP No. A-037849 2.2140 2. RAFAEL PATIO TCT No. T-929/EP No. A-037861 3.00783 among other persons, which was registered with the Register of Deeds and
identified as follows: annotated at the back of OCT No. P-3077-1661. The annotation in the OCT showed
15. CHARIE E. NASTOR TCT No. T-825/EP No. A-037829 3.9291 that the entire 527.8308 hectares was the subject of the Deed of Assignment.
16. NELSON L. NULLAS TCT No. T-396/EP No. A-037826 2.7491
In 1982, a final survey over the entire area was conducted and approved. From 1984
17. CARLITO S. OLIA TCT No. T-910/EP No. A-037673 1.7954 to 1988, the corresponding TCTs and EPs covering the entire 527.8308 hectares
The parcels of land described above, the subject matters in this Petition, were were issued to petitioners, among other persons.
18. ROBERTO T.PATIO TCT No. T-912/EP No. A-037860 6.4266 formerly part of a forested area which have been denuded as a result of the logging
operations of respondent Hacienda Maria, Inc. (HMI). Petitioners, together with In December 1997, HMI filed with the Regional Agrarian Reform Adjudicator
19. ANTONIO P. ROCHA TCT No. T-914/EP No. A-037830 2.2143
other persons, occupied and tilled these areas believing that the same were public (RARAD) of CARAGA, Region XIII, 17 petitions seeking the declaration of
lands. HMI never disturbed petitioners and the other occupants in their peaceful erroneous coverage under Presidential Decree No. 27 of 277.5008 hectares of its
20. FERNANDO C. RUFINO TCT No. T-923/EP No. A-037848 4.5322
cultivation thereof. former landholdings covered by OCT No. P-3077-1661. HMI claimed that said area
21. PATERNO P. SAIN TCT No. T-954/EP No. A-037813 4.3223 was not devoted to either rice or corn, that the area was untenanted, and that no
HMI acquired such forested area from the Republic of the Philippines through Sales compensation was paid therefor. The 17 petitions, which were later consolidated,
22. CLAUDIO S. SAYSON, and TCT No. T-891/EP No. A-037880 3.7151 Patent No. 2683 in 1956 by virtue of which it was issued OCT No. P-3077-1661. sought for the cancellation of the EPs covering the disputed 277.5008 hectares
The title covered three parcels of land with a total area of 527.8308 hectares, to wit: which had been awarded to petitioners. HMI did not question the coverage of the
23. JOEMARIE VIBO TCT No. T-893/EP No. A-037827 1.31852 other 250.3300 hectares under Presidential Decree No. 27 despite claiming that the
entire landholdings were untenanted and not devoted to rice and corn.
ESTANISLAO DELA CRUZ, SR., EDGAR DUENAS, MARIO ERIBAL,
REYNALDO C. ESENCIA, EMMA GONZAGA, RUBEN A. IBOJO,
SAMUEL JAMANDRE, HILARION V. LANTIZA, ANSELMO LOPEZ, On 27 November 1998, after petitioners failed to submit a Position Paper, the
TERESITA NACION, CHARIE E. NASTOR, NELSON L. NULLAS, RARAD rendered a Decision declaring as void the TCTs and EPs awarded to
Lot No. Area
CARLITO S. OLIA, ANA PATIO, ROBERTO T. PATIO, ANTONIO P. petitioners because the land covered was not devoted to rice and corn, and neither
was there any established tenancy relations between HMI and petitioners when
Presidential Decree No. 27 took effect on 21 October 1972. The Decision was based
on a 26 March 1998 report submitted by the Hacienda Maria Action Team.
Petitioners TCTs and EPs were ordered cancelled. Petitioners filed a Motion for
Reconsideration, but the same was denied. Petitioners appealed to the Department
of Agrarian Reform Adjudication Board (DARAB) which affirmed the RARAD
Decision.
After the DARAB denied petitioners Motion for Reconsideration, the latter
proceeded to the Court of Appeals with their Petition for Review on Certiorari. The
Court of Appeals issued the following assailed Resolution:
A perusal of the petition reveals that the Verification and Certification of Non-
Forum Shopping was executed by Samuel A. Estribillo who is one of the
petitioners, without the corresponding Special Power of Attorneys executed by the
other petitioners authorizing him to sign for their behalf in violation of Section 5,
Rule 7 of the 1997 Rules of Civil Procedure, as amended.
WHEREFORE, the petition is DENIED DUE COURSE and necessarily
DISMISSED.6
Petitioners filed a "Motion for Reconsideration With Alternative Prayer with Leave
of Court for the Admission of Special Power of Attorney (SPA) Granted to
Petitioner Samuel Estribillo by his Co-Petitioners." The Court of Appeals denied the
motion by issuing the following assailed Resolution:
Petitioners seek the reconsideration of Our Resolution promulgated on January 27,
2003 which dismissed the petition for certiorari.
We find no reason to reverse, alter or modify the resolution sought to be
reconsidered, since petitioners have failed to show that their belated submission of
the special power of attorney can be justified as against the unequivocal
requirements set forth by Sec. 5, Rule 7 of the 1997 Rules of Civil Procedure, as
amended.
While it is true that the Supreme Court has recognized special circumstances that
justify the relaxation of the rules on non-forum shopping, such circumstances,
however, are not present in the case at bar.
More importantly, said Rules cannot be relaxed in view of the Supreme Courts
ruling in Loquias vs. Ombudsman, 338 SCRA 62, which stated that, substantial
compliance will not suffice in a matter involving strict observance by the rules. The
attestation contained in the certification [on] non-forum shopping requires personal
knowledge by the party who executed the same.
Since the Verification and Certification on Non-Forum shopping was executed
without the proper authorization from all the petitioners, such personal knowledge
cannot be presumed to exist thereby rendering the petition fatally defective.
Par. 2, Sec. 5 of Rule 7 of the 1997 Rules of Civil Procedure, as amended states:
"Failure to comply with the foregoing requirements shall not be curable by mere
amendment of the complaint or other initiatory pleading but shall be cause for the
dismissal of the case without prejudice x x x"
It is, thus, clear that the Motion for Reconsideration has no legal basis to support it
and should be dismissed forthwith. Moreover, granting arguendo that a special
power of attorney belatedly filed could cure the petitions defect, the requirement of
personal knowledge of all the petitioners still has not been met since some of the
other petitioners failed to sign the same.
WHEREFORE, in view of the foregoing, the Motion for Reconsideration is hereby
DENIED.7
Petitioners now file this present Petition contending that there had been compliance
with Rule 7, Section 5 of the 1997 Rules of Civil Procedure. They further reiterate
their argument that the EPs are ordinary titles which become indefeasible one year
after their registration.
The petition is impressed with merit.1awphil.net
Petitioners have sufficiently complied with Rule 7, Section 5 of the 1997 Rules of
Civil Procedure concerning the Certification Against Forum shopping
Rule 7, Section 5 of the 1997 Rules of Civil Procedure was preceded by Revised
Circular No. 28-91 and Administrative Circular No. 04-94, which required a
certification against forum shopping to avoid the filing of multiple petitions and
complaints involving the same issues in the Supreme Court, the Court of Appeals,
and other tribunals and agencies. Stated differently, the rule was designed to avoid a
situation where said courts, tribunals and agencies would have to resolve the same
issues. Rule 7, Section 5, now provides:
Sec. 5. Certification against forum shopping. The plaintiff or principal party shall
certify under oath in the complaint or other initiatory pleading asserting a claim for
relief, or in a sworn certification annexed thereto and simultaneously filed
therewith: (a) that he has not theretofore commenced any action or filed any claim
involving the same issues in any court, tribunal or quasi-judicial agency and, to the
best of his knowledge, no such other action or claim is pending therein; (b) if there
is such other pending action or claim, a complete statement of the present status
thereof; and (c) if he should thereafter learn that the same or similar action or claim
has been filed or is pending, he shall report that fact within five (5) days therefrom
to the court wherein his aforesaid complaint or initiatory pleading has been filed.
Failure to comply with the foregoing requirements shall not be curable by mere
amendment of the complaint or other initiatory pleading but shall be cause for the
dismissal of the case without prejudice, unless otherwise provided, upon motion
and after hearing. The submission of a false certification or non-compliance with
any of the undertakings therein shall constitute indirect contempt of court, without
prejudice to the corresponding administrative and criminal actions. If the acts of the
party or his counsel clearly constitute willful and deliberate forum shopping, the
same shall be ground for summary dismissal with prejudice and shall constitute
direct contempt as well as a cause for administrative sanctions.
Revised Circular No. 28-91 "was designed x x x to promote and facilitate the
orderly administration of justice and should not be interpreted with such absolute
literalness as to subvert its own ultimate and legitimate objective or the goal of all
rules of procedure which is to achieve substantial justice as expeditiously as
possible."8 Technical rules of procedure should be used to promote, not frustrate,
justice.9 The same guidelines should still apply in interpreting what is now Rule 7,
Section 5 of the 1997 Rules of Civil Procedure.
Petitioner Samuel A. Estribillo, in signing the Verification and Certification Against
Forum Shopping, falls within the phrase "plaintiff or principal party" who is
required to certify under oath the matters mentioned in Rule 7, Section 5 of the
1997 Rules of Civil Procedure. Such was given emphasis by this Court when we
held in Mendigorin v. Cabantog10 and Escorpizo v. University of Baguio11 that the
certification of non-forum shopping must be signed by the plaintiff or any of the
principal parties and not only by the legal counsel. In Condo Suite Club Travel, Inc.
v. National Labor Relations Commission,12 we likewise held that:
The certification in this petition was improperly executed by the external legal
counsel of petitioner. For a certification of non-forum shopping must be by the
petitioner, or any of the principal parties and not by counsel unless clothed with a
special power of attorney to do so. This procedural lapse on the part of petitioner is
also a cause for the dismissal of this action. (Emphasis supplied)
The Court of Appeals heavily relied on the seemingly conflicting case of Loquias v.
Office of the Ombudsman,13where this Court ruled that:
At the outset, it is noted that the Verification and Certification was signed by
Antonio Din, Jr., one of the petitioners in the instant case. We agree with the
Solicitor General that the petition is defective. Section 5, Rule 7 expressly provides
that it is the plaintiff or principal party who shall certify under oath that he has not
commenced any action involving the same issues in any court, etc. Only petitioner
Din, the Vice-Mayor of San Miguel, Zamboanga del Sur, signed the certification.
There is no showing that he was authorized by his co-petitioners to represent the
latter and to sign the certification. It cannot likewise be presumed that petitioner
Din knew, to the best of his knowledge, whether his co-petitioners had the same or
similar actions or claims filed or pending. We find that substantial compliance will
not suffice in a matter involving strict observance by the rules. The attestation
contained in the certification on non-forum shopping requires personal knowledge
by the party who executed the same. Petitioners must show reasonable cause for
failure to personally sign the certification. Utter disregard of the rules cannot justly
be rationalized by harking on the policy of liberal construction. (Emphasis supplied)
Loquias, however, was a case involving only five petitioners seeking relief from the
Resolution of the Ombudsman charging them with violation of Republic Act No.
3019, where the above declaration "at the outset" was made together with a
determination on the lack of jurisdiction on our part to decide the Petition. 14 There
being only five petitioners in Loquias, the unreasonableness of the failure to obtain
the signatures of Antonio Din, Jr.s four co-accused is immediately apparent, hence
the remark by this Court that "[p]etitioners must show reasonable cause for failure
to personally sign the certification." In the present petition, petitioners allege that
they are farmer-beneficiaries who reside in a very remote barangay in Agusan del
Sur. While they reside in the same barangay, they allegedly have to walk for hours
on rough terrain to reach their neighbors due to the absence of convenient means of
transportation. Their houses are located far apart from each other and the mode of
transportation, habal-habal, is scarce and difficult. Majority of them are also nearing
old age. On the other hand, their lawyers (who are members of a non-government
organization engaged in development work) are based in Quezon City who started
assisting them at the latter part of the RARAD level litigation in 1998, and became
their counsel of record only at the DARAB level. The petitioner who signed the
initiatory pleading, Samuel Estribillo, was the only petitioner who was able to travel
to Manila at the time of the preparation of the Petition due to very meager resources
of their farmers organization, the Kahiusahan sa Malahutayong mga Mag-uugma
Para sa Ekonomikanhong Kalambuan (KAMMPE). When the Petition a quo was
dismissed, petitioners counsel went to Agusan del Sur and tried earnestly to secure
all the signatures for the SPA. In fact, when the SPA was being circulated for their
signatures, 24 of the named petitioners therein failed to sign for various reasons
some could not be found within the area and were said to be temporarily residing in
other towns, while some already died because of old age. 15 Be that as it may, those
who did not sign the SPA did not participate, and are not parties to this petition.
The Court of Appeals merely said that the special circumstances recognized by this
Court that justify the relaxation of the rules on the certification against forum
shopping are not present in the case at bar, 16 without discussing the circumstances
adduced by the petitioners in their Motion for Reconsideration. Thus, assuming for
the sake of argument that the actuation of petitioners was not strictly in consonance
with Rule 7, Section 5 of the 1997 Rules of Civil Procedure, it should still be
determined whether there are special circumstances that would justify the
suspension or relaxation of the rule concerning verification and certification against
forum shopping, such as those which we appreciated in the ensuing cases.
In General Milling Corporation v. National Labor Relations Commission, 17 the
appeal to the Court of Appeals had a certificate against forum shopping, but was
dismissed as it did not contain a board resolution authorizing the signatory of the
Certificate. Petitioners therein attached the board resolution in their Motion for
Reconsideration but the Court of Appeals, as in this case, denied the same. In
granting the Petition therein, we explained that:
[P]etitioner complied with this procedural requirement except that it was not
accompanied by a board resolution or a secretarys certificate that the person who
signed it was duly authorized by petitioner to represent it in the case. It would
appear that the signatory of the certification was, in fact, duly authorized as so
evidenced by a board resolution attached to petitioners motion for reconsideration
before the appellate court. It could thus be said that there was at least substantial
compliance with, and that there was no attempt to ignore, the prescribed procedural
requirements.
The rules of procedure are intended to promote, rather than frustrate, the ends of
justice, and while the swift unclogging of court dockets is a laudable objective, it,
nevertheless, must not be met at the expense of substantial justice. Technical and
procedural rules are intended to help secure, not suppress, the cause of justice and a
deviation from the rigid enforcement of the rules may be allowed to attain that
prime objective for, after all, the dispensation of justice is the core reason for the
existence of courts. [Acme Shoe, Rubber and Plastic Corp. vs. Court of Appeals;
BA Savings Bank vs. Sia, 336 SCRA 484].
In Shipside Incorporated v. Court of Appeals, 18 the authority of petitioners resident
manager to sign the certification against forum shopping was submitted to the Court
of Appeals only after the latter dismissed the Petition. It turned out, in the Motion
for Reconsideration, that he already had board authority ten days before the filing of
the Petition. We ratiocinated therein that:
On the other hand, the lack of certification against forum shopping is generally not
curable by the submission thereof after the filing of the petition. Section 5, Rule 45
of the 1997 Rules of Civil Procedure provides that the failure of the petitioner to
submit the required documents that should accompany the petition, including the
certification against forum shopping, shall be sufficient ground for the dismissal
thereof. The same rule applies to certifications against forum shopping signed by a
person on behalf of a corporation which are unaccompanied by proof that said
signatory is authorized to file a petition on behalf of the corporation.
In certain exceptional circumstances, however, the Court has allowed the belated
filing of the certification. In Loyola v. Court of Appeals, et al. (245 SCRA 477
[1995]), the Court considered the filing of the certification one day after the filing
of an election protest as substantial compliance with the requirement. In Roadway
Express, Inc. v. Court of Appeals, et al. (264 SCRA 696 [1996]), the Court allowed
the filing of the certification 14 days before the dismissal of the petition. In Uy v.
Landbank, supra, the Court had dismissed Uys petition for lack of verification and
certification against non-forum shopping. However, it subsequently reinstated the
petition after Uy submitted a motion to admit certification and non-forum shopping
certification. In all these cases, there were special circumstances or compelling
reasons that justified the relaxation of the rule requiring verification and
certification on non-forum shopping.
In the instant case, the merits of petitioners case should be considered special
circumstances or compelling reasons that justify tempering the requirement in
regard to the certificate of non-forum shopping. Moreover, in Loyola, Roadway,
and Uy, the Court excused non-compliance with the requirement as to the certificate
of non-forum shopping. With more reason should we allow the instant petition since
petitioner herein did submit a certification on non-forum shopping, failing only to
show proof that the signatory was authorized to do so. That petitioner subsequently
submitted a secretarys certificate attesting that Balbin was authorized to file an
action on behalf of petitioner likewise mitigates this oversight.
It must also be kept in mind that while the requirement of the certificate of non-
forum shopping is mandatory, nonetheless the requirements must not be interpreted
too literally and thus defeat the objective of preventing the undesirable practice of
forum-shopping. Lastly, technical rules of procedure should be used to promote, not
frustrate justice. While the swift unclogging of court dockets is a laudable objective,
the granting of substantial justice is an even more urgent ideal.
In Uy v. Land Bank of the Philippines, 19 we, likewise, considered the apparent
merits of the substantive aspect of the case as a special circumstance or compelling
reason for the reinstatement of the case, and invoked our power to suspend our rules
to serve the ends of justice. Thus:
The admission of the petition after the belated filing of the certification, therefore,
is not unprecedented. In those cases where the Court excused non-compliance with
the requirements, there were special circumstances or compelling reasons making
the strict application of the rule clearly unjustified. In the case at bar, the apparent
merits of the substantive aspects of the case should be deemed as a "special
circumstance" or "compelling reason" for the reinstatement of the petition. x x x
There were even cases where we held that there was complete non-compliance with
the rule on certification against forum shopping, but we still proceeded to decide the
case on the merits. In De Guia v. De Guia,20petitioners raised in their Petition for
Review the allowance of respondents Appeal Brief which did not contain a
certificate against forum shopping. We held therein that:
With regard to the absence of a certification of non-forum shopping, substantial
justice behooves us to agree with the disquisition of the appellate court. We do not
condone the shortcomings of respondents counsel, but we simply cannot ignore the
merits of their claim. Indeed, it has been held that "[i]t is within the inherent power
of the Court to suspend its own rules in a particular case in order to do justice."
In Damasco v. National Labor Relations Commission,21 the non-compliance was
disregarded because of the principle of social justice, which is equally applicable to
the case at bar:
We note that both petitioners did not comply with the rule on certification against
forum shopping. The certifications in their respective petitions were executed by
their lawyers, which is not correct. The certification of non-forum shopping must be
by the petitioner or a principal party and not the attorney. This procedural lapse on
the part of petitioners could have warranted the outright dismissal of their actions.
But, the court recognizes the need to resolve these two petitions on their merits as a
matter of social justice involving labor and capital. After all, technicality should not
be allowed to stand in the way of equitably and completely resolving herein the
rights and obligations of these parties. Moreover, we must stress that technical rules
of procedure in labor cases are not to be strictly applied if the result would be
detrimental to the working woman.
The foregoing cases show that, even if we assume for the sake of argument that
there was violation of Rule 7, Section 5 of the 1997 Rules of Civil Procedure, a
relaxation of such rule would be justified for two compelling reasons: social justice
considerations and the apparent merit of the Petition, as shall be heretofore
discussed.
Certificates of Title issued pursuant to Emancipation Patents are as indefeasible as
TCTs issued in registration proceedings.
Petitioners claim that the EPs have become indefeasible upon the expiration of one
year from the date of its issuance. The DARAB, however, ruled that the EP "is a
title issued through the agrarian reform program of the government. Its issuance,
correction and cancellation is governed by the rules and regulations issued by the
Secretary of the Department of Agrarian Reform (DAR). Hence, it is not the same
as or in the same category of a Torrens title."
The DARAB is grossly mistaken.
Ybaez v. Intermediate Appellate Court,22 provides that certificates of title issued in
administrative proceedings are as indefeasible as certificates of title issued in
judicial proceedings:
It must be emphasized that a certificate of title issued under an administrative
proceeding pursuant to a homestead patent, as in the instant case, is as indefeasible
as a certificate of title issued under a judicial registration proceeding, provided the
land covered by said certificate is a disposable public land within the contemplation
of the Public Land Law.
There is no specific provision in the Public Land Law (C.A. No. 141, as amended)
or the Land Registration Act (Act 496), now P.D. 1529, fixing the one (1) year
period within which the public land patent is open to review on the ground of actual
fraud as in Section 38 of the Land Registration Act, now Section 32 of P.D. 1529,
and clothing a public land patent certificate of title with indefeasibility.
Nevertheless, the pertinent pronouncements in the aforecited cases clearly reveal
that Section 38 of the Land Registration Act, now Section 32 of P.D. 1529 was
applied by implication by this Court to the patent issued by the Director of Lands
duly approved by the Secretary of Natural Resources, under the signature of the
President of the Philippines in accordance with law. The date of issuance of the
patent, therefore, corresponds to the date of the issuance of the decree in ordinary
registration cases because the decree finally awards the land applied for registration
to the party entitled to it, and the patent issued by the Director of Lands equally and
finally grants, awards, and conveys the land applied for to the applicant. This, to our
mind, is in consonance with the intent and spirit of the homestead laws, i.e.
conservation of a family home, and to encourage the settlement, residence and
cultivation and improvement of the lands of the public domain. If the title to the
land grant in favor of the homesteader would be subjected to inquiry, contest and just compensation should the disputed 277.5008 hectares be covered under
Original Grantees TCT/EP Nos.
decision after it has been given by the Government through the process of Republic Act No. 6657 instead of Presidential Decree No. 27. 30 This is further
proceedings in accordance with the Public Land Law, there would arise uncertainty, 1. SAMUEL ESTRIBILLO TCT No. T-287/EP No. A-037675 proved by the following uncontested allegations by petitioners:
confusion and suspicion on the governments system of distributing public
agricultural lands pursuant to the "Land for the Landless" policy of the State. 2. CALIXTO P. ABAYATO, JR. TCT No. T-297/EP No. A-037814 (i) HMI neither asked for rentals nor brought any action to oust
TCT No. T-829/EP No. A-027293 petitioners from the farm they were cultivating;
The same confusion, uncertainty and suspicion on the distribution of government-
3. RONGIE D. AGUILAR TCT No. T-913/EP No. A-027295
acquired lands to the landless would arise if the possession of the grantee of an EP
(ii) HMI had not paid realty taxes on the disputed property from 1972
would still be subject to contest, just because his certificate of title was issued in an 4. TACIANA D. AGUILAR TCT No. T-944/EP No. A-027296 onwards and never protested petitioners act of declaring the same for
administrative proceeding. The silence of Presidential Decree No. 27 as to the
realty taxation;
indefeasibility of titles issued pursuant thereto is the same as that in the Public Land 5. ARTEMIO G. DE JUAN, TCT No. T-302/EP No. A-037809
Act where Prof. Antonio Noblejas commented:
6. ESTANISLAO DELA CRUZ, (iii) HMI, represented by a certain Angela Colmenares, signed the LTPA
TCT No. T-290/EP No. A-035676 covering the entire landholdings or the area of 527.8308 hectares, which
Inasmuch as there is no positive statement of the Public Land Law, regarding the SR.
was then represented to be rice and corn lands;
titles granted thereunder, such silence should be construed and interpreted in favor
7. EDGAR DUENAS TCT No. T-949/EP No. A-037658
of the homesteader who come into the possession of his homestead after complying
with the requirements thereof. Section 38 of the Land Registration Law should be 8. MARIO P. ERIBAL TCT No. T-952/EP No. A-037836 (iv) HMI abandoned the entire landholdings after executing the Deed of
interpreted to apply by implication to the patent issued by the Director of Lands, Assignment of Rights in 1977.
duly approved by the Minister of Natural Resources, under the signature of the 9. REYNALDO C. ESENCIA TCT No. T-950/EP No. A-037844
President of the Philippines, in accordance with law.23
WHEREFORE, the Resolutions of the Court of Appeals in CA-G.R. SP No.
10. RUBEN A. IBOJO TCT No. T-928/EP No. A-037873
73902 are REVERSED and SET ASIDE. The following EPs and the
After complying with the procedure, therefore, in Section 105 of Presidential corresponding TCTs issued to petitioners or to their successors-in-interest are
11. SAMUEL JAMANDRE TCT No. T-909/EP No. A-159348
Decree No. 1529, otherwise known as the Property Registration Decree (where the hereby declared VALID and SUBSISTING:
DAR is required to issue the corresponding certificate of title after granting an EP to 12. HILARION V. LANTIZA TCT No. T-288/EP No. A-037674
tenant-farmers who have complied with Presidential Decree No. 27), 24 the TCTs TCT No. T-401/EP No. A-037825 Look table
issued to petitioners pursuant to their EPs acquire the same protection accorded to
other TCTs. "The certificate of title becomes indefeasible and incontrovertible upon 13. ANSELMO LOPEZ TCT No. T-973/EP No. A-037840
the expiration of one year from the date of the issuance of the order for the issuance Costs against respondent Hacienda Maria, Inc.
of the patent, x x x. Lands covered by such title may no longer be the subject matter 14. TERESITA NACION TCT No. T-900/EP No. A-037849
of a cadastral proceeding, nor can it be decreed to another person." 25
15. CHARIE E. NASTOR TCT No. T-825/EP No. A-037829 SO ORDERED.
26
As we held through Justice J.B.L. Reyes in Lahora v. Dayanghirang, Jr. : 16. NELSON L. NULLAS TCT No. T-396/EP No. A-037826 MINITA V. CHICO-NAZARIO
Associate Justice
The rule in this jurisdiction, regarding public land patents and the character of the 17. CARLITO S. OLIA TCT No. T-910/EP No. A-037673
certificate of title that may be issued by virtue thereof, is that where land is granted
18. ROBERTO T.PATIO TCT No. T-912/EP No. A-037860 WE CONCUR:
by the government to a private individual, the corresponding patent therefor is
recorded, and the certificate of title is issued to the grantee; thereafter, the land is 19. ANTONIO P. ROCHA TCT No. T-914/EP No. A-037830
automatically brought within the operation of the Land Registration Act, the title On Official Leave
issued to the grantee becoming entitled to all the safeguards provided in Section 38 20. FERNANDO C. RUFINO TCT No. T-923/EP No. A-037848 ARTEMIO V. PANGANIBAN
of the said Act. In other words, upon expiration of one year from its issuance, the Chief Justice
certificate of title shall become irrevocable and indefeasible like a certificate issued 21. PATERNO P. SAIN TCT No. T-954/EP No. A-037813 Chairperson
in a registration proceeding. (Emphasis supplied.)
22. CLAUSIO S. SAYSON TCT No. T-891/EP No. A-037880
CONSUELO MA. ALICIA AUSTRIA-
The EPs themselves, like the Certificates of Land Ownership Award (CLOAs) in 23. JOEMARIE VIBO TCT No. T-893/EP No. A-037827 YNARES- MARTINEZ
Republic Act No. 6657 (the Comprehensive Agrarian Reform Law of 1988), are SANTIAGO Asscociate Justice
enrolled in the Torrens system of registration. The Property Registration Decree in 24. MANUEL S. GONZAGA TCT No. T-920/EP No. A-037832 Associate Justice
fact devotes Chapter IX27 on the subject of EPs. Indeed, such EPs and CLOAs are, Acting Chairman
in themselves, entitled to be as indefeasible as certificates of title issued in 25. RAFAEL PATIO TCT No. T-297/EP No. A-037861
registration proceedings.
beneficiaries later on being issued with CLOAs, would only delay the application of
agrarian reform laws to the disputed 277.5008 hectares, leading to the expenditure
The only defense of respondents, that the issue of indefeasibility of title was raised of more time and resources of the government.
for the first time on appeal with the DARAB, does not hold water because said ROMEO J. CALLEJO, SR.
issue was already raised before the RARAD.28 Associate Justice
The unreasonable delay of HMI in filing the Petition for cancellation more than 20
years after the alleged wrongful annotation of the Deed of Assignment in OCT No.
The recommendation of the Hacienda Maria Action Team to have the EPs cancelled P-3077-1661, and more than ten years after the issuance of the TCTs to the farmers, AT T E S T AT I O N
and the lots covered under the Republic Act No. 6657, 29 with the farmer- is apparently motivated by its desire to receive a substantially higher valuation and
 9 23
I attest that the conclusions in the above Decision were reached in consultation Cusi-Hernandez v. Diaz, 390 Phil. 1245, 1252 (2000). REGISTRATION OF LAND, TITLES AND DEEDS, Antonio H.
before the case was assigned to the writer of the opinion of the Courts Division. Noblejas, p. 431 (1992 revised ed.)
10
436 Phil. 483, 491 (2002).
24
CONSUELO YNARES-SANTIAGO Presidential Decre No. 1529, Section 105: "x x x After the tenant-
Associate Justice 11 farmer shall have fully complied with the requirements for a grant of
366 Phil. 166, 175 (1999).
Acting Chairman, First Division title under P.D. No. 27, an Emancipation Patent which may cover
previously titled or untitled property shall be issued by the Department
12
380 Phil. 660, 667 (2000). of Agrarian Reform.
C E R T I F I C AT I O N
13
392 Phil. 596, 603-604 (2000). The Register of Deeds shall complete the entries on the
Pursuant to Article VIII, Section 13 of the Constitution, and the Division
aforementioned Emancipation Patent and shall assign an
Chairmans Attestation, it is hereby certified that the conclusions in the above
original certificate of title in case of unregistered land, and in
Decision were reached in consultation before the case was assigned to the writer of 14
We held in Loquias that "this court will not interfere with the case of registered property, shall issue the corresponding
the opinion of the Courts Division. Ombudsmans exercise of his constitutionally mandated investigatory certificate of title without requiring the owners duplicate of
and prosecutory powers. Otherwise stated, it is beyond the ambit of this the title to be cancelled.x x x"
Court to review the exercise of discretion of the Ombudsman in
REYNATO S. PUNO
prosecuting or dismissing a complaint filed before it. Such initiative and
Acting Chief Justice 25
independence are inherent in the Ombudsman who, beholden to no one, Amado D. Aquino, Land registration and related Proceedings, Chapter
acts as the champion of the people and preserver of the integrity of the XII "Land Patents", p. 139; citing Gomez v. Court of Appeals, G.R. No.
Footnotes public service. x x x" (Id.) L-77770, 15 December 1988, 168 SCRA 503, 511; Duran v. Oliva, 113
Phil. 144, 148-149 (1961).
1 15
CA-G.R. SP No. 73902. Both Resolutions were penned by Associate Rollo, pp. 190-191.
26
Justice Juan Q. Enriquez, Jr., with Associate Justices Bernardo P. 147 Phil. 301, 304 (1971).
Abesamis and Edgardo F. Sundiam, concurring; Rollo, pp. 35-36; 38-40. 16
Id. at 30.
27
Chapter IX: CERTIFICATE OF LAND TRANSFER,
2
Rollo, p. 5. 17 EMANCIPATION PATENT, AFFIDAVIT OF NON-TENANCY.
442 Phil. 425, 427-428 (2002).
28
3
Id. 18 DARAB/RARAD Records, p. 472: "x x x It bears emphasis that a
G.R. No. 143377, 20 February 2001, 352 SCRA 334, 346-347. patent when registered in the corresponding Register of Deeds is a
4 veritable Torrens title and becomes as indefeasible as to the Torrens title
Id. at 6. 19
391 Phil. 303, 314 (2000), citing Melo v. Court of Appeals, G.R. No. upon the expiration of one (1) year from the date of its issuance.
123686, 16 November 1999, 318 SCRA 94. Nullification of certificate may be had only in a case directly attacking
5
DECREEING THE EMANCIPATION OF TENANTS FROM THE its validity but never collaterally."
BONDAGE OF THE SOIL TRANSFERRING TO THEM THE 20
G.R. No. 135384, 4 April 2001, 356 SCRA 287, 294-295.
OWNERSHIP OF THE LAND THEY TILL AND PROVIDING THE 29
Under R.A. No. 6657, the Comprehensive Agrarian Reform Law of
INSTRUMENTS AND MECHANISM THEREFOR.
21
1988, Agrarian Reform means the "redistribution of lands, regardless of
G.R. Nos. 115755 & 116101, 4 December 2000, 346 SCRA 714, 720- crops and fruits produced, to farmers and regular farmworkers who are
6 721, citing Condo Suite Club Travel, Inc. v. National Labor Relations landless, irrespective of tenurial arrangement, x x x."
Id. at 36.
Commission, G.R. No. 125671, January 28, 2000, 323 SCRA 679;
Philippine Scout Veterans Security and Investigation Agency Inc. v.
30
7
Id. at 39-40. National Labor Relations Commission, G.R. No. 124500, 4 December See DARAB records, p. 472.
1998, 299 SCRA 690, 694; Judy Phils., Inc. v. National Labor Relations
8 Commission, G.R. No. 111934, 29 April 1998, 289 SCRA 755, 764.
Gabionza v. Court of Appeals, G.R. No. 112547, 18 July 1994, 234
SCRA 192, 198.
22
G.R. No. 68291, 6 March 1991, 194 SCRA 743, 749-750.