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G.R. Nos. 186184 & 186988.1 September 20, 2010.

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CELESTINO SANTIAGO substituted by LAURO SANTIAGO and ISIDRO GUTIERREZ
substituted by ROGELIO GUTIERREZ, petitioners, vs. AMADA R. ORTIZ-LUIS substituted
by JUAN ORTIZ-LUIS, JR., respondent.

Agrarian Reform Law; Right of Retention; The right of retention, as protected and enshrined in the
Constitution, balances the effect of compulsory land acquisition by granting the landowner the right to
choose the area to be retained subject to legislative standards.—The right of retention, as protected and
enshrined in the Constitution, balances the effect of compulsory land acquisition by granting the
landowner the right to choose the area to be retained subject to legislative standards.
Same; Same; Landowners who have not yet exercised their retention rights under Presidential
Decree No. 27 are entitled to new retention rights provided for by Republic Act No. 6657.—
In Association of Small Landowners in the Philippines, Inc. v. Secretary of Agrarian Reform, 175 SCRA
343 (1989), the Court held that landowners who have not yet exercised their retention rights under P.D.
No. 27 are entitled to “new retention rights provided for by R.A. No. 6657 . . .” In Heirs of Aurelio
Reyes v. Garilao, 605 SCRA 294 (2009), however, the Court held that the limitations under LOI No.
474 still apply to a landowner who filed an application under R.A. 6657.
Same; Same; Section 9 (d) of Department of Agrarian Reform (DAR) Administrative Order No. 05 is
inconsistent with Presidential Decree (P.D.) No. 27, as amended by Letter of Instruction (LOI) No. 474,
insofar as it removed the limitations to a landowner’s retention rights.—Letter of Instruction (LOI) No.
474 amended P.D. No. 27 by removing “any right of retention from persons who own other agricultural
lands of more than 7 hectares, or lands used for residential, commercial, industrial or other purpose from
which they derive adequate income to support themselves and their families.” Section 9 (d) of DAR
Administrative Order No. 05, on which the Court of Appeals in part anchored its ruling, is inconsistent
with P.D. No. 27, as amended by LOI No. 474, insofar as it removed the limitations to a landowner’s
retention rights. It is well-settled that administrative officials are empowered to promulgate rules and
regulations in order to implement a statute. The power, however, is restricted such that an administrative
regulation cannot go beyond what is provided in the legislative enactment. It must always be in harmony
with the provisions of the law, hence, any resulting discrepancy between the two will always be resolved
in favor of the statute.
PETITION for review on certiorari of a resolution of the Court of Appeals.
The facts are stated in the opinion of the Court.
Carlitos N. Encarnacion II for petitioners.
Yambao Law Office for respondent.

CARPIO-MORALES, J.:
Petitioners Lauro Santiago and Rogelio Gutierrez, in substitution of their now deceased
respective fathers Celestino Santiago and Isidro Gutierrez, challenge the August 22, 2008
Decision of the Court of Appeals2 respecting the retention rights under Republic Act No.
66573 (R.A. 6657) of Amada R. Ortiz-Luis (Amada), substituted by her son-herein respondent
Juan, Jr.
Juan and Amada Ortiz Luis (Spouses Ortiz Luis) were the owners of 7.1359 hectares of
tenanted riceland situated in Barangay San Fernando Sur, Cabiao, Nueva Ecija and covered by
TCT No. NT-10798 (the property).
Pursuant to Presidential Decree No. 27 (P.D. No. 27), “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,” which took effect on October 21,
1972, the property was placed under Operation Land Transfer (OLT).
Despite the inclusion of the property under the OLT, the Spouses Ortiz-Luis, by Deed of
Absolute Sale dated June 16, 1979, transferred it to their children Rosario, Teresita, Simplicio
and Antonio, all surnamed Ortiz-Luis. The children were able to have the property transferred
under their names on June 25, 1992.
The children later filed an Application for Retention under P.D. No. 27 before the Department
of Agrarian Reform Regional Office (DARRO) which was denied by Order dated February 28,
1997 in this wise:
“It bears stressing that the Transfer Certificate of Title evidencing the conveyance in favor of herein
petitioners-appellants was registered only on 25 June 1992, hence the subject land is still considered
under the ownership of Spouses Ortiz Luis (pursuant to Memorandum dated January 9, 1973 and
Department Memorandum Circular No. 8, Series of 1974) insofar as coverage under OLT is concerned.
xxxx
Upon conducting a careful investigation of the records presented, this Office concludes beyond any
iota of doubt thatthe landholding in issue was indeed conveyed to petitioners-appellants after October 21,
1972 which is a clear violation of agrarian laws, rules and regulations.”4 (underscoring supplied)

In light of the denial of her children’s application for retention, Amada filed on July 14, 1999
an Application for Retention over the property under R.A. 6657 before the DARRO.
By Decision of November 24, 1999, the Provincial Agrarian Reform Adjudicator (PARAD),
to which the application was referred for determination of the validity of TCT No. NT-189843
issued to the children, ordered the cancellation of said title and reinstated the spouses’ Ortiz-
Luis’ title. Amada’s application for retention was thus given due course by DARRO.
Provincial Agrarian Reform Officer (PARO) Rogelio M. Chavez recommended the denial of
Amada’s application upon the ground that “an owner of tenanted rice and corn lands may not
retain those lands if he, as of October 21, 1972, owned more than 24 hectares of tenanted rice or
corn lands.”5 It appears that Spouses Ortiz Luis owned 178.8092 hectares, only 88.4513 of which
were placed under OLT.The PARO’s recommendation notwithstanding, DARRO, by Order of
May 23, 2000,6granted Amada’s application for retention, it holding that her failure to exercise
her retention rights under P.D. No. 27 entitled her to the benefit of retention under R.A. 6657.
Farmer-beneficiaries Celestino (petitioner Lauro’s father) and Isidro (petitioner Rogelio’s
father), having been granted on May 20, 1994 emancipation patents covering 2.9424 hectares
and 2.0238 hectares of the property, respectively, moved for reconsideration of the DARRO May
23, 2000 Order. DARRO denied the motion by Order of October 4, 2000.On the assumption that
no appeal was filed, DARRO issued a Memorandum dated October 24, 2000 to implement its
Orders.
Amada subsequently filed on March 2, 2001 a petition for cancellation of Celestino and
Isidro’s emancipation patents before the PARAD. The farmer-beneficiaries did not file their
Answer, despite notice, and failed to appear during the hearings of the petition. After the ex-
partepresentation of Amada’s evidence, Adjudicator Napoleon Baguilat, by Decision of April
11, 2001,7ordered the cancellation of Celestino and Isidro’s Emancipation Patents:
“WHEREFORE, premises considered, judgment is hereby rendered as follows:
1. Declaring the private respondents[-herein petitioners] as lessees over the retained area of
the petitioner;
2. Declaring [herein petitioners’] TCT Nos. EP 74278 and 74276 to have lost its force and
effect upon the rendition of this decision;
3. Declaring the Municipal Agrarian Reform Office of Cabiao, Nueva Ecija to cause the
execution of leasehold contract between the petitioner and the private respondents[-herein
petitioners];
4. Directing the Register of Deeds for the Province of Nueva Ecija to cancel the TCT Nos.
EP 74278 and 74276 registered in the names of Celestino Santiago and Isidro Gutierrez.”8

Two (2) days after the issuance of the PARAD April 11, 2001 Decision or on April 14, 2001,
Celestino and Isidro filed their Answer/Motion for Reconsideration which was denied by Order
of June 21, 2001.
On appeal, the Department of Agrarian Reform Adjudication Board (DARAB), by Decision
of April 5, 2005, ruled in favor of petitioners:
“Under Administrative Order No. 4, Series of 1991, the authority to issue a certificate of retention on
landholdings covered under R.A. 6657 lies exclusively with the Regional Director. It likewise provides
that “the Order of the Regional Director approving or denying the application for retention shall become
final fifteen (15) days from receipt of the same, unless appeal is made to the DAR Secretary.” In the case
at bar, Private Respondents (petitioners) were able to appeal the Order of Retention issued by Regional
Director Atty. Acosta to the DAR Secretary. The appeal is still pending before the Office of the Director
of the Bureau of Agrarian Legal Assistance (BALA), Department of Agrarian Reform, Diliman, Quezon
City, as per certification dated February 21, 2005.
In view thereof, thecancellation of subject EPs is not warranted on the ground that the Order of
Retention has not attained finality.”9 (emphasis and underscoring supplied)

Juan Ortiz-Luis, Jr. (respondent), who substituted for Amada after she passed away on
December 8, 2001, filed a petition for review before the Court of Appeals following the denial
by the DARAB of his motion for reconsideration of its April 5, 2005 Decision. The petition was
docketed as CA-G.R. SP No. 97071.
In time, Celestino and Isidro’s appeal to the DAR Secretary respecting the DARRO Orders
which granted retention rights to Amada was denied by DAR Secretary Roberto Pagdanganan by
Order of October 24, 2003 (Pagdanganan Order).10Celestino and Isidro filed a motion for
reconsideration. Pending resolution of the motion, Celestino died11 and was thereupon substituted
by petitioner Lauro.
Secretary Pagdanganan’s successor-in-interest, Secretary Nasser Pangandaman, granted
Celestino and Isidro’s Motion for Reconsideration and accordingly reversed the Pagdanganan
Order by Order of October 24, 2005 (Pangandaman Order) in this wise:12
“It must be stressed that when spouses Juan and Amada Ortiz-Luis filed an Application for Retention
on 14 July 1999, PARO Rogelio M. Chavez of South Nueva Ecija recommended for the denial of the said
Application for Retention pursuant to M.C. No. 18-81 and A.O. No. 4, Series of 1991, considering the
fact also that the spouses owned an aggregate landholding of 178.8092 hectares where the 7.1358 hectare
subject landholdings from the aggregate 88. 5413 hectares of which are rice and corn land were already
covered under OLT pursuant to P.D. No. 27 and E.O. No. 228.
L.O.I. No. 474 clearly finds application to the present case, and, having established that applicants-
appellees own other agricultural lands seven (7) hectares or more, there can be no question that they are
not entitled to retention under P.D. No. 27.”13

His motion for reconsideration having been denied, respondent appealed to the Office of the
President (OP) which, by Decision of May 9, 2007, reversed and set aside the Pangandaman
Order and reinstated the Pagdanganan Order upholding the grant to Amada of her retention
rights.
Petitioners thereupon elevated the matter to the Court of Appeals via petition for review,
docketed as CA-G.R. SP No. 100439. This petition was consolidated with respondent’s above-
mentioned petition in CA-G.R. SP No. 97071(assailing the DARAB Resolution setting aside the
cancellation of petitioners’ E[mancipation] P[atents].
By the assailed Decision of August 22, 2008, the Court of Appeals, in CA-G.R. SP No.
100439, upheld the Decision of the OP, clarifying, however, that:
“x x x in the implementation of this Decision, the Department of Agrarian Reform through the
Municipal Agrarian Reform Office (MARO) is herebyORDERED to fully accord ARBs Celestino
Santiago and Isidro Gutierrez as substituted by Lauro Santiago and Rogelio Gutierrez, respectively, their
rights under Section 6 of Republic Act No. 6657 and DAR Administrative Order No. 05-00 as already
discussed.”14 (underscoring supplied)
The appellate court dismissed CA-G.R. No. 97071 which respondent did not challenge.
In the present petition, petitioners assail the appellate court’s upholding of Amada’s right of
retention inCA-G.R. SP No. 100439 andciting DAR Administrative Order (AO) No. 05, Series
of 2000.15
The petition is impressed with merit.
The relevant provision of AO No. 05, Series of 2000 reads:
“SEC. 9. Retention Area—The area allowed to be retained by the landowner shall be as
follows:
(a) Landowners covered by PD 27 are entitled to retain seven (7) hectares, except those
whose entire tenanted rice and corn lands are subject of acquisition and distribution under
OLT. An owner of tenanted rice and corn lands may not retain those lands under the
following cases:
1. If he, as of 21 October 1972, owned more than twenty-four (24) hectares of tenanted rice
and corn lands; or
2. By virtue of Letter of Instruction (LOI) No. 474, if he, as of 21 October 1972, owned less
than twenty-four (24) hectares of tenanted rice and corn lands but additionally owned the
following:
i. other agricultural lands of more than seven (7) hectares, whether tenanted or not,
whether cultivated or not, and regardless of the income derived therefrom; or
ii. lands used for residential, commercial, industrial or other urban purposes from
which he derives adequate income to support himself and his family.
xxxx
(d) Landowners who filed their applications after the 27 August 1985 deadline and did not
comply with LOI No. 41, 45 and 52 shall only be entitled to a maximum of five (5)
hectares as retention area. Landowners who failed to qualify to retain under paragraph (a)
of this Section shall also be allowed to retain a maximum of five (5) hectares in
accordance with RA 6657. (underscoring supplied)

The right of retention, as protected and enshrined in the Constitution, balances the effect of
compulsory land acquisition by granting the landowner the right to choose the area to be retained
subject to legislative standards.16
The legislative standards are set forth in Section 6 of R.A. 6657, thus:
“Section 6. Retention Limits.—Except as 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-size, 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 or directly managing the farm; Provided, That landowners
whose land have been covered by Presidential Decree No. 27 shall be allowed to keep the area originally
retained by them thereunder, Provided, further,That the 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.
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 retention by the landowner is tenanted,
the tenant shall have the option to choose whether to remain therein or be a beneficiary in the same or
another agricultural land with similar or comparable features. In case the tenant chooses to remain in the
retained area, he shall be considered a leaseholder and shall lose his right to be a beneficiary under this
Act. In case the tenant chooses to be a beneficiary in another agricultural land, he loses his right as a
lease-holder to the land retained by the landowner. The tenant must exercise this option within a period of
one (1) year from the time the landowner manifests his choice of the area for retention.” (underscoring
supplied)

Section 6 implies that the sole requirement in the exercise of retention rights is that the area
chosen by the landowner must be compact or contiguous. In the recent case of Heirs of Aurelio
Reyes v. Garilao,17 however, the Court held that a landowner’s retention rights under R.A. 6657
are restricted by the conditions set forth in Letter of Instruction (LOI) No. 474 issued on October
21, 1976 which reads:
To: The Secretary of Agrarian Reform.
WHEREAS, last year I ordered that small landowners of tenanted rice/corn lands with areas of less than
twenty-four hectares but above seven hectares shall retain not more than seven hectares of such lands
except when they own other agricultural lands containing more than seven hectares or land used for
residential, commercial, industrial or other urban purposes from which they derive adequate income to
support themselves and their families;
WHEREAS, the Department of Agrarian Reform found that in the course of implementing my directive
there are many landowners of tenanted rice/corn lands with areas of seven hectares or less who also own
other agricultural lands containing more than seven hectares or lands used for residential, commercial,
industrial or other urban purposes where they derive adequate income to support themselves and their
families;
WHEREAS, it is therefore necessary to cover said lands under the Land Transfer Program of the
government to emancipate the tenant-farmers therein.
NOW, THEREFORE, I, PRESIDENT FERDINAND E. MARCOS, President of the Philippines, do
hereby order the following:
“1. You shall undertake to place under the Land Transfer Program of the government pursuant to
Presidential Decree No. 27, all tenanted rice/corn lands with areas of seven hectares or less belonging to
landowners who own other agricultural lands of more than seven hectares in aggregate areas or lands used
for residential, commercial, industrial or other urban purposes from which they derive adequate income to
support themselves and their families.” (underscoring supplied)

DAR Memorandum Circular No. 11, Series of 197818 provided for the implementing
guidelines of LOI No. 474:
“Tenanted rice/corn lands with areas of seven hectares or less shall be covered by Operation
Land Transfer if those lands belong to the following landowners:
a.) Landowners who own other agricultural lands of more than seven hectares in aggregate
areas, whether tenanted or not, cultivated or not, and regardless of the income derived
therefrom;
b.) Landowners who own lands used for residential, commercial, industrial or other urban
purposes from which they derive an annual gross income of at least five thousand
(P5,000.00) pesos. (underscoring supplied)

In Association of Small Landowners in the Philippines, Inc. v. Secretary of Agrarian


Reform,19 the Court held that landowners who have not yet exercised their retention rights under
P.D. No. 27 are entitled to “new retention rights provided for by R.A. No. 6657 . . .”20 In Heirs
of Aurelio Reyes v. Garilao, however, the Court held thatthe limitations under LOI No. 474
still apply to alandowner who filed an application under R.A. 6657.
Amada is thus not entitled to retention rights. As noted by the PARO in recommending denial
of her application which was eventually heeded in the Pangandaman Order, while Spouses Ortiz
Luis owned aggregate landholdings equivalent to 178.8092 hectares, only a portion thereof—
88.5413 hectares—were placed under OLT. A Certification dated May 7, 200121 issued by the
Municipal Agrarian Reform Office (MARO) affirms that as of even date, Spouses Ortiz Luis still
owned 162.1584 hectares of land in Cabiao, Nueva Ecija.
Letter of Instruction (LOI) No. 474 amended P.D. No. 27 by removing “any right of retention
from persons who own other agricultural lands of more than 7 hectares, or lands used for
residential, commercial, industrial or other purpose from which they derive adequate income to
support themselves and their families.”22
Section 9 (d) of DAR Administrative Order No. 05, on which the Court of Appeals in part
anchored its ruling, is inconsistent with P.D. No. 27, as amended by LOI No. 474, insofar as
itremoved the limitations to a landowner’s retention rights.
It is well-settled that administrative officials are empowered to promulgate rules and
regulations in order to implement a statute. The power, however, is restricted such that an
administrative regulation cannot go beyond what is provided in the legislative enactment. It must
always be in harmony with the provisions of the law, hence, any resulting discrepancy between
the two will always be resolved in favor of the statute.23
WHEREFORE, the challenged Court of Appeals Decision dated August 22, 2008 in C.A.-
G.R. S.P. No. 100439 is REVERSED and SET ASIDE. The Order dated October 24, 2005 of
Agrarian Reform Secretary Nasser Pangandaman is REINSTATED.
SO ORDERED.
Peralta,** Bersamin, Villarama, Jr. and Sereno, JJ., concur.

Judgment reversed and set aside.

Note.—There can be no claim of more than one right of retention per landowner. (Roman
Catholic Archbishop of Caceres vs. Secretary of Agrarian Reform, 541 SCRA 304 [2007])

G.R. No. 132759. October 25, 2005. *

ALEJANDRO DANAN, TIRSO LINGAD, JR., AMADO BELLEZA, CARLITO SANTOS,


LADISLAO DANAN, RUBEN SAMBAT, RODRIGO DANAN, ABEDNIDO DANAN, FELIX
ESCUETA, ROMEO TALA, ADELOMO BALUYOT, PEDRO TALA, RUBEN MANGANTI,
PAQUITO CRUZ, RICARDO DIMARUCUT, RUFINO DEL ROSARIO, MARCOS
PANGAN, LAURA MANIAGO, LAMBERTO DANAN, FLORNARDO MANANSALA,
DOMINADOR ARTOLA, ROBERTO ZUÑIGA, JR., JOSE MENDOZA, ROMAN BERNAL,
BENEDICTO DANAN, JOEL DANAN, RODRIGO PAULE, JIMMY MANALAC,
FELICIANO MACASPAC, MARIANO MANANSALA, SILVESTRE MANUEL, FAUSTINO
PANGAN, FLORENCIO PANGAN, CONRADO CARLOS, RODRIGO PANGAN,
MAXIMINIANO DANAN, PESCASIO DIMARUCUT, DANIEL DANAN, LUCIANO
MANLAPAZ, ARMANDO DANAN, FELICIANO MALLARI, REYNALDO MUSNI, RODEL
ZUNIGA, SOTERO MONTEMAYOR, RICARDO DANAN, ALFREDO MORALES, JESUS
NUNAG, ABRAHAM MANUYAG, PEDRO MERCADO, OSCAR MANALILI,
FORTUNATO MANUEL, ROSITA BERNAL, RUBEN MIRANDA, NICOLAS
MANANSALA, JOSE MANLAPAZ, JR., DIOSDADO LINGAD, MONICA TALA, JULIE
CORTES, ANDRES PAULE, RONNIE PAULE, CARLITO AGUILUS, ROMEO BALINGIT,
BENIGNO PORTALES, ARNEL SAMBAT, ALFREDO ALFARO, ROMEO ALFARO,
FELICIANO BUCAD, SR., ONADAB ISIP, CARLITO DIMACALI, JAIME BAUTISTA,
ELIAS BALINGIT, REMY CARLOS, MARIANO SANTOS, FEDERICO MANLAPAZ,
REYNALDO SANTOS, ADELAIDA CALMA, GREGORIO CALMA, PEPITO ALFARO,
FERNANDO MANANSALA, JOE RAMMIE EMILIA, ROGELIO CORTES, DOMINADOR
MALIT, ELPIDIO TALA, RODRIGO TALA, SALVADOR TALA, ROMEO TALA, REMEO
DANAN, EDUARDO DANAN, CEZAR DANAN, BENJAMIN PANGAN, DOMINGO
SUMANDAL, MOISES SUSI, RODOLFO GERVACIO, SR., RODOLFO GERVACIO, JR.,
JESUS BERNAL, ALFREDO SANTOS, FORTUNATO DANAN, FRANCISCO MACASPAC,
EDWIN MACASPAC, FELICISIMO MACASPAC, DIOSDADO MACASPAC, REYNALDO
TIMBANG, EULOGIO MACASPAC, RICARDO CHAVEZ, RUBEN MANUYAG, DELFIN
TALA, TOMAS PAULE, CLARO SUBA, DIOSDADO FLORES, FRANCISCO NORALES,
VENANCIO FLORES, DANTE FLORES, AGUSTIN ARIOLA, RICARDO ARIOLA,
ARTEMIO FLORES, FELICIANO BUCOD, JR., ROLANDO SERRANO, JUANITO
LINTAG, TOMAS TALA, LEONARDO RONQUILLO, LAMBERTO TALA, RICARDO
LINGAD, ANOTNIO SANTOS, IGNACIO TRESVALLES, ERNESTO PITUC, TEOFILO
MUNOZ, BIENVENIDO BELLEZA, MANUEL MAGUIAT, OFELIA MIGUEL, PEDRO
TALA, ALEJANDRO TALA, RODRIGO SERRANO, FRANCISCO BERNARTE, OSCAR
SERRANO, CONSOLACION SERRANO, CEZAR SERRANO, JOSE BERNARTE, JESUS
BERNARTE, CALIXTO SERRANO, ROBERTO MALLARI, ARNOLD PATRICIA,
REYNALDO OSBUAL, WILFREDO TAPALLA, ELIZALDE FAPREQUILAN, REYNALDO
CASTRO, LUISITO MALLARI, ANTONIO CASTRO, MARCELO MANANSALA,
MARFELA AQUINO, HERMOGENES LACAP, VIRGILIO MANANSALA, NESTOR
DATU, ROMEO DATU, ALEGRIA BELLEZA, PURITA MIRANDO, MARIA PEREZ,
ALBERTO DELA CRUZ, ARTURO DELA CRUZ, GENERITO TALA, CELESTINO
TAPALLA, JIMMY TAPALLA, MIKE TAPALLA, REMIGIO OSBUAL, MYRNA MIGUEL,
EDUARDO ESCUETA, CONRADO MALLARI, AVELINO MIGUEL, VICTORINO TALA,
IGNACIO DELA CRUZ, ROLANDO OSBUAL and ROLANDO MASANQUE,
petitioners, vs.THE HONORABLE COURT OF APPEALS and ESTRELLA ARRASTIA,
respondents.

G.R. No. 132866. October 25, 2005.*


THE COURT OF APPEALS and THE DEPARTMENT OF AGRARIAN REFORM
ADJUDICATION BOARD, petitioners, vs. ESTRELLA ARRASTIA, respondent.

Agrarian Reform Law;Tenancy; Mere occupation or cultivation of an agricultural land does not
automatically convert a tiller or farmworker into an agricultural tenant recognized under agrarian
laws.—Mere occupation or cultivation of an agricultural land does not automatically convert a tiller or
farmworker into an agricultural tenant recognized under agrarian laws. The essential requisites of a
tenancy relationship are: (1) the parties are the landowner and the tenant; (2) the subject is agricultural
land; (3) there is consent among the parties; (4) the purpose is agricultural production; (5) there is
personal cultivation; and (6) there is sharing of harvests. All these requisites must concur in order to
create a tenancy relationship between the parties. In the case at bar, it has not been sufficiently established
that private petitioners’ occupation and cultivation of the disputed property was with the consent of the
landowners.
Same; Same; Constitutional Law; The right of retention is a constitutionally guaranteed right,
which is subject to qualification by the legislature. For as long as the area to be retained is compact or
contiguous and does not exceed the retention ceiling of five (5) hectares, a landowner’s choice of the area
to be retained must prevail.—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. A retained area, as its name denotes, is
land which is not supposed to anymore leave the landowner’s dominion, thus sparing the government
from the inconvenience of taking land only to return it to the landowner afterwards, which would be a
pointless process. For as long as the area to be retained is compact or contiguous and does not exceed the
retention ceiling of five (5) hectares, a landowner’s choice of the area to be retained must prevail.
Moreover, Administrative Order No. 4, series of 1991, which supplies the details for the exercise of a
land-owner’s retention rights, likewise recognizes no limit to the prerogative of the landowner, although
he is persuaded to retain other lands instead to avoid dislocation of farmers. Therefore, there is no legal
and practical basis to order the commencement of the administrative proceedings for the placement of
respondent Arrastia’s land under the CARP since her property’s land area falls below the retention limit
of five (5) hectares.

PETITIONS for review on certiorari of the decision and resolution of the Court of Appeals.

The facts are stated in the opinion of the Court.


Anselmo M. Carlos for petitioner in G.R. No. 132759.
Ida R. Makalinao-Javier and Mylene T. Marcia-Creencia for private respondent.

TINGA, J.:

This deals with two separate Rule 45 petitions, later consolidated, filed by the Department of
Agrarian Reform Adjudication Board (“DARAB”) and Alfredo Danan, et al. Both petitions seek
the reversal of the Court of Appeals’ Decision in CA-G.R. SP No. 33796, which reversed and set
aside the DARAB Decision in DARAB Case and its Resolution denying petitioners’ motion for
reconsideration.
Petitioners (“private petitioners”) in G.R. No. 132759 are all residents of Lubao, Pampanga,
claiming to be cultivating a vast landholding owned by the heirs of Teodorica Reinares Arrastia,
Leticia Arrastia Montenegro and Juanita Arrastia (“Arrastia heirs”). Said property has an
aggregate area of approximately three hundred (300) hectares and is situated at the Barangaysof
Lourdes, Baruya, and San Isidro, all within the Municipality of Lubao, Pampanga. The records
of the case show that the landholding had been subdivided and distributed among the Arrastia
heirs and the corresponding certificates of titles issued accordingly.
Petitioner in G.R. No. 132866 is the DARAB, the adjudication arm of the Department of
Agrarian Reform (“DAR”) that is tasked to implement the government’s comprehensive agrarian
reform program (“CARP”).
The common respondent in both petitions is Estrella Arrastia, one of the Arrastia heirs and a
co-owner of the disputed property. Respondent Arrastia own 4.4630 hectares of the disputed
property.
The factual antecedents are as follows:
Sometime in 1976, a certain Rustico Coronel leased the subject property for a period of
twelve (12) years or until the crop year 1987 to 1988. On September 27, 1986, persons claiming
1

to be farmers and residents ofBarangay Lourdes andBarangay San Rafael signed a joint
resolution as members of the Aniban ng mga Manggagawa sa Agrikultura(“AMA”) to enter and
lease the subject property from the Arrastia heirs. Then Pampanga Governor Brien Guiao
favorably endorsed the resolution to then Minister of Environment and Natural Resources
Heherson Alvarez. On the basis of said resolution but without the consent of the landowners, the
AMA members, who are herein petitioners, entered the disputed land, cleared portions thereof
and planted various crops thereon. This culminated in a violent confrontation on May 21, 1988
that led to the filing of criminal charges against AMA members.2

On June 2, 1988, the AMA filed a complaint with petitioner DARAB, docketed as DARAB
Case No. 0001, praying that respondent Arrastia be prevented from destroying standing crops on
the disputed property and from fencing said property and that petitioners be allowed to continue
with their farming thereon. On August 15, 1988, the DARAB ordered the DAR Regional
Director to conduct an ocular inspection on the disputed property. The inspection team
3

submitted an Ocular/Investigation Report with the observation that there were no substantially
significant plantings on the disputed property. The Municipal Agrarian Reform Officer
(“MARO”) of Lubao, Pampanga also submitted a report dated September 21, 1989,
recommending the disqualification of private petitioners from availing of the benefits under the
CARP. 4

On October 5, 1988, the DARAB issued an order denying AMA’s motion for authority to
cultivate. The order became final and executory on July 29, 1989, after the DARAB denied
AMA’s motion for reconsideration. 5

On behalf of her co-heirs and co-owners, Arrastia instituted an action against private
petitioners for violation of Section 73(b) of Republic Act (R.A.) No. 6657 on October 9, 1989.
Arrastia’s complaint, docketed as Agrarian Case No. 2000, was raffled to Branch 48 of the
Regional Trial Court of San Fernando, Pampanga on October 9, 1989. The trial court, sitting as a
special agrarian court (“SAC”), issued a temporary restraining order, and subsequently a
preliminary injunction, both enjoining private petitioners from entering and cultivating the
disputed property.
On November 29, 1989, private petitioners filed a complaint for injunction and damages
before the Provincial Agrarian Reform Adjudication Board (“PARAD”) against Arrastia,
alleging that they were actual tillers of the disputed property who were forcibly evicted by
Arrastia from their tenanted lots through the use of armed men. In their complaint, docketed as
DARAB Regional Case No. 161-P’ 89, they prayed that Arrastia be restrained from preventing
them from reoccupying the property in question. Upon referral of the matter to the respective
Barangay Agrarian Reform Committees (“BARC”) of theBarangays of Lourdes, San Isidro, and
San Rafael, BARC officials reported that the dispute could no longer be settled amicably. In
particular, the BARC ofBarangay San Rafael (Baruya), Lubao informed the hearing officer that
private petitioners were tenants or actual tillers of the disputed property. The Lubao MARO also
submitted the reports of other BARC officials. 6

On the basis of the reports submitted by BARC officials and private petitioners’ affidavits,
the hearing officer issued on December 9, 1990 an order granting a preliminary injunction to
restrain Arrastia from disturbing private petitioners in the tilling of the disputed property. The
PARAD hearing officer also directed the MARO to act on the petition for the coverage of the
disputed property under the CARP. 7

Meanwhile, on January 30, 1991, Arrastia filed an omnibus motion in DARAB Case No.
0001, questioning the jurisdiction of the hearing officer to issue an order of injunction. The
DARAB denied said motion and subsequently issued the writ of injunction on September 22,
1992.
Arrastia filed an answer in DARAB Regional Case No. 161-P’ 89, interposing the defense
that the disputed land was not devoted to agriculture and that private petitioners were not tenants
thereof.
After due hearing, the PARAD rendered a decision in DARAB Regional Case No. 161-P’ 89
on May 13, 1993, declaring that the subject property is covered by the CARP and that private
petitioners are qualified beneficiaries of the program. The adjudicator also issued an injunction
prohibiting Arrastia from disturbing private petitioners’ occupation of the property. The
dispositive portion of the decision reads:
“WHEREFORE, PREMISES CONSIDERED, this Board hereby renders judgment:

1. (1)Confirming and declaring that the subject landholding with an area of 300 hectares, more or
less, situated atBarangays Lourdes, San Isidro and San Rafael (Baruya), Lubao, Pampanga,
owned by the defendant and her co-owners are agricultural land subject to the coverage of RA
No. 6657, and that plaintiffs are qualified beneficiaries who enjoy the benefits of agrarian laws
including the right to an award of the lands they actually till in accordance with the procedure
therein;
2. (2)Making the preliminary injunction hereto forthwith issued, prohibiting the defendant and her
co-owners and all other persons claiming any right or title under them, from continuing to
exclude plaintiffs and from re-entry and re-occupation of the subject landholding as agricultural
tenants and their restoration thereat, final and permanent; and
3. (3)Ordering the defendant and her co-owners to pay plaintiffs the amount of P10,000.00 as
attorney’s fees, plus costs.”
8

Arrastia appealed the aforementioned decision to petitioner DARAB. The appeal was docketed
as DARAB Case No. 1551. On March 28, 1994, the DARAB rendered its decision modifying the
appealed judgment, the dispositive portion of which reads:
“WHEREFORE, premises considered, the appeal is DISMISSED. The judgment of the Provincial
Adjudicator is hereby modified as follows:

1. 1.Declaring Dominador Flores, Rodrigo Serrano, Oscar Salazar, Alejandro Danan, Tirso Lingad,
Francisco Santos, Dante Danan, Jesus Castro, Amado Escueta, Marcos Susi, Francisco Bernate,
Felix Escueta, Ladislao Danan, Lamberto Danan, Carlito Santos, Orlando Santos, Jose
Manansala, Eulalio Danan, Eddie Escueta, Conrado Castro, Pedro Tala and Victorino Tala to be
agricultural lessees on their respective tillages, and ordering their reinstatement on the land;
2. 2.Ordering the rest of the Plaintiffs-Appellees to be reinstated on the land and to possess and
occupy their respective areas of cultivation;

1. 3.Ordering the Regional Director of the Department of Agrarian Reform, Region III, San
Fernando, Pampanga, the Provincial Agrarian Reform Officer for the Province of Pampanga and
the Municipal Reform Officer for the Municipality of Lubao, Province of Pampanga to
immediately undertake administrative processes for the coverage of the land under Republic Act
No. 6657 and other applicable agrarian laws, DAR Administrative Order No. 1, Series of 1993,
DAR Department Memorandum Circular No. 04, Series of 1993 and other DAR rules and
regulations taking into consideration the qualifications of Appellees to be beneficiaries of the
program as well as the right of retention of the owners of the subject landholding and the last
paragraph of Section 6, Republic Act No. 6657 which provides:

Upon the effectivity of this Act, any sale, disposition, lease, management contract or transfer of possession of
private lands executed by the original landowner in violation of this Act shall be null and void; Provided, however,
That those executed prior to this Act shall be valid only when registered with the Register of Deeds within the
period of three (3) months after the effectivity of this Act. Thereafter, all Register of Deeds shall inform the DAR
within thirty (30) days of any transaction involving agricultural lands in excess of five (5) hectares.

1. 4.Ordering Defendant-Appellant, or any person or persons acting for and in behalf, to refrain
from committing any act or acts which will disturb or in any way adversely interfere with the
peaceful possession, occupation and farming activities of Appellees on the land itself;
2. 5.Ordering Defendant-Appellant to pay Plaintiff-Appellees the reasonable amount of Twenty
Thousand Pesos (P20,000.00) as attorney’s fees plus costs of the suit; and
3. 6.Ordering the Regional Sheriff of the DAR Regional Adjudication Board, Region III, to
implement this Order and submit a return to this Board within seven (7) days from receipt of
this Order. This decision is immediately executory pursuant to Section 50 of Republic Act No.
6657.” 9

Aggrieved, Arrastia elevated the controversy to the Court of Appeals, which reversed and set
aside the decision of the DARAB. On the issue of whether private petitioners are qualified
beneficiaries under the CARP, the appellate court ruled in the negative mainly on the basis of the
report of MARO Josefina Vidal which was quoted at length in its Decision. In the said report, the
MARO recommended the disqualification of private petitioners from the coverage of the CARP
in view of their continued violation of Sections 22 and 23 of Executive Order No. 229, under
which persons, associations, or entities which prematurely enter lands covered by agrarian
reform shall be permanently disqualified from CARP coverage and cited for contempt,
respectively. The Court of Appeals also found private petitioners guilty of violating the
temporary restraining order and preliminary injunction issued by the SAC in Agrarian Case No.
2000 and also the temporary restraining issued by the Court of Appeals itself on April 13, 1994.
The appeals court denied the motions for reconsideration separately filed by private petitioners.
Hence, the petitions before this Court.
In its petition, DARAB raised the following issues:

1. 1.1.THE HONORABLE COURT OF APPEALS ERRED WHEN IT SET ASIDE THE


ENTIRETY OF THE DECISION APPEALED FROM, TO INCLUDE THE ORDER
TO PLACE THE DISPUTED LANDHOLDINGS UNDER CARP COVERAGE, ON
THE SOLE BASIS OF THE FINDING THAT PRIVATE RESPONDENTS
(FARMERS) THEREIN WERE DISQUALIFIED AS FARMER BENEFICIARIES;
2. 1.2.THE HONORABLE COURT OF APPEALS ERRED WHEN IT RULED ON THE
DISQUALIFICATION OF ALL THE FARMERS (PRIVATE RESPONDENTS
THEREIN), IRRESPECTIVE OF WHETHER THEY (OR SOME) ARE
AGRICULTURAL TENANTS OR NOT, ON THE SOLE BASIS OF A FIELD
REPORT THAT WAS PREPARED AND SUBMITTED WITHOUT THE FARMERS
AT LEAST GIVEN OPPORTUNITY TO BE HEARD, THUS, VIOLATIVE OF DUE
PROCESS. 10

In turn, private petitioners in their petition impute the following errors to the Court of Appeals:

1. 1.RESPONDENT COURT GRAVELY ERRED IN NOT GIVING FIRST DUE


COURSE TO THE PETITION IN CA-G.R. NO. 33796 AND REQUIRED THE
DARAB TO ELEVATE TO IT THE RECORDS OF DARAB CASE NO. 1551
INCLUDING ALL THE EVIDENCE PRESENTED SO IT COULD HAVE FULLY
APPRECIATED ALL THE FACTS INSTEAD OF MERELY RELYING ON THE
PLEADINGS FILED BEFORE IT.
2. 2.THE RESPONDENT COURT GRAVELY ERRED IN IGNORING FUNDAMENTAL
RULES OF ADMINISTRATIVE DUE PROCESS BY ITS FAILURE AND REFUSAL
TO CONSIDER SUBSTANTIVE EVIDENCE INTRODUCED BY PETITIONERS IN
THE PROCEEDINGS IN DARAB CASE NO. 161-P’89 AND DARAB CASE NO.
1551 RESULTING IN FINDINGS WHICH ARE NOT ONLY CONTRARY TO LAW
AND THE EVIDENCE ON RECORD BUT ARE FURTHER PATENTLY PARTIAL
TO PRIVATE RESPONDENTS.
3. 3.THE RESPONDENT COURT GRAVELY ERRED IN MAKING CONCLUSIONS
FROM ITS REVIEW OF THE DARAB DECISION IN DARAB CASE NO. 1551
WITHOUT ANY BASIS ON THE DECISION ITSELF THUS CITING ERRORS IN
THE SAID DECISION WHICH WERE NOT ACTUALLY MADE BY THE DARAB.
4. 4.THE RESPONDENT COURT GRAVELY ERRED IN REVERSING THE FINDINGS
OF FACTS OF THE DARAB WITHOUT DUE REGARD TO EVIDENCE
PRESENTED BEFORE THE LATTER. 11

The two petitions advance two main arguments: first, the Court of Appeals’ finding that private
petitioners are ineligible to become CARP beneficiaries is without factual or evidentiary
basis;second, the Court of Appeals’ reversal of the DARAB’s order to undertake administrative
proceedings for the acquisition of the subject property for agrarian reform purposes is premature.
Private petitioners contend that the Court of Appeals’ declaration that they are not qualified
beneficiaries of the CARP has no evidentiary basis because it failed to order the transmittal of
the DARAB records, particularly the reports of the different BARC officials establishing tenancy
relationship between private petitioners and the owners of the disputed property. For its part,
DARAB denies having categorically declared in its decision in DARAB Case No. 1551 that
private petitioners are qualified beneficiaries because the administrative proceeding to determine
the beneficiaries entitled under R.A. No. 6657 was yet to be undertaken not by DARAB but by
the administrative officials of DAR. DARAB also describes as arbitrary and unilateral the
MARO report quoted by the appellate court in support of its ruling that private petitioners
prematurely entered the disputed property.
The resolution of the issue on private petitioners’ eligibility under the CARP calls for a
review of the evidence on record to determine whether or not the conclusion of the Court of
Appeals has factual basis. At the outset, it should be noted that the jurisdiction of this Court in a
petition for review on certiorari under Rule 45 of the Rules of Court is limited to reviewing only
errors of law, as it is not a trier of facts. It is a settled doctrine that findings of fact of the Court of
Appeals are binding and conclusive upon this Court, not to be disturbed unless: (1) the
conclusion is a finding grounded entirely on speculation, surmise and conjecture; (2) the
inference made is manifestly mistaken; (3) there is grave abuse of discretion; (4) the judgment is
based on a misapprehension of facts; (5) the findings of fact are conflicting; (6) the Court of
Appeals went beyond the issues of the case and its findings are contrary to the admissions of
both appellant and appellees; (7) the findings of fact of the Court of Appeals are contrary to
those of the trial court; (8) said findings of fact are conclusions without citation of specific
evidence on which they are based; (9) the facts set forth in the petition as well as in the
petitioner’s main and reply briefs are not disputed by the respondents; and (10) the findings of
fact of the Court of Appeals are premised on the supposed absence of evidence and contradicted
by the evidence on record. 12

The DARAB and the Court of Appeals’ findings in respect to the status of private petitioners
are conflicting. The DARAB found that private petitioners are either agricultural lessees paying
rentals to the landowners or actual tillers in possession of distinct portions of the subject
property. The Court of Appeals, however, found private petitioners as not qualified to become
CARP beneficiaries on account of certain violations they committed and considered it
unnecessary to ascertain their status as agricultural lessees or tillers. In view of the divergent
opinions, the Court must review the evidence relied upon by the DARAB and the Court of
Appeals in arriving at their respective conclusions.
The Court affirms factual findings and conclusions of the Court of Appeals.
The appellate court’s conclusion that private petitioners committed particular violations
warranting their disqualification from the CARP is based on the MARO report which has not
been disputed by all the private petitioners. The MARO who prepared the report enjoys the
presumption of regularity in the performance of her functions. Absent any showing that the
Court of Appeals committed grave abuse of discretion in giving evidentiary weight to said
report, said factual findings are generally deemed conclusive on this Court, which is not a trier of
facts.
13

Anent DARAB’s contention that the MARO report was made unilaterally and without giving
private petitioners the opportunity to be heard, the circumstances not nullify said report for lack
of due process. The essence of due process is simply an opportunity to be heard or, as applied to
administrative proceedings, an opportunity to explain one’s side or an opportunity to seek
reconsideration of the action or ruling complained of. Private petitioners cannot claim denial of
14

due process simply because they had ample opportunity to rebut the MARO’s findings and
present contrary evidence in the proceedings before the PARAD, the DARAB, or the Court of
Appeals. Private petitioners insist that they are bona fideagricultural tenants of the disputed
property. It is unnecessary to pass upon this issue in the light of the categorical finding of the
appellate court that private petitioners are no longer entitled to avail of the benefits under the
CARP. In any event, however, the claim is not well-founded.
A perusal of the decision in DARAB Case No. 1551 reveals that DARAB classified two (2)
sets of farmworkers, i.e., those who cultivated the land and paid corresponding rentals, and those
who occupied and cultivated portions of the disputed property since 1986 as certified by BARC
officials.
Mere occupation or cultivation of an agricultural land does not automatically convert a tiller
or farmworker into an agricultural tenant recognized under agrarian laws. The essential requisites
of a tenancy relationship are: (1) the parties are the landowner and the tenant; (2) the subject is
agricultural land; (3) there is consent among the parties; (4) the purpose is agricultural
production; (5) there is personal cultivation; and (6) there is sharing of harvests. All these
requisites must concur in order to create a tenancy relationship between the parties. In the case
15

at bar, it has not been sufficiently established that private petitioners’ occupation and cultivation
of the disputed property was with the consent of the landowners.
DARAB assails the Court of Appeals in reversing the DARAB decision in its entirety. It
contends that the determination of private petitioners’ eligibility under R.A. No. 6657 has no
bearing on its order to commence administrative procedure for the acquisition of the disputed
property.
As borne by the case records, respondent Arrastia owns only 4.4630 hectares of the subject
16

property, which is below the retention limit under Section 6 of R.A. No. 6657 granting a right of
17

retention of up to a maximum of five (5) hectares of agricultural land in favor of a landowner


whose property may be acquired for distribution to agrarian reform beneficiaries. Consequently,
a landowner may keep his entire covered landholding if its aggregate size does not exceed the
retention limit of five (5) hectares. His land will not be covered at all by the operation land
transfer program although all requisites for coverage are present.
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. A retained area, as its name
denotes, is land which is not supposed to anymore leave the landowner’s dominion, thus sparing
the government from the inconvenience of taking land only to return it to the landowner
afterwards, which would be a pointless process. For as long as the area to be retained is compact
18
or contiguous and does not exceed the retention ceiling of five (5) hectares, a landowner’s choice
of the area to be retained must prevail. Moreover, Administrative Order No. 4, series of 1991,
which supplies the details for the exercise of a land-owner’s retention rights, likewise recognizes
no limit to the prerogative of the landowner, although he is persuaded to retain other lands
instead to avoid dislocation of farmers. Therefore, there is no legal and practical basis to order
19

the commencement of the administrative proceedings for the placement of respondent Arrastia’s
land under the CARP since her property’s land area falls below the retention limit of five (5)
hectares.
WHEREFORE, both petitions in G.R No. 132759and G.R. No. 132866 are DENIED.
The Decision of the Court of Appeals in CA-G.R. SP No. 33796 is AFFIRMED. Costs against
private petitioners. SO ORDERED.
Puno (Chairman),Austria-Martinez andCallejo, Sr., JJ., concur.
Chico-Nazario, J.,On Leave.

Both petitions in G.R. No. 132759 and G.R. No. 132866denied, judgment affirmed.
Notes.—Unless the requisite elements of tenancy concur in order to create a tenancy
relationship between the parties, the Court cannot bring the matter within the purview of tenancy
under CARL. (Romero vs. Tan, 424 SCRA 108 [2004])
Elements of agrarian tenancy relationship are: (1) the subject matter should be agricultural
land; (2) the purpose should be agricultural production; and (3) there should be personal
cultivation done by the tenants themselves. (Romero vs. Tan, Ibid.)

G.R. No. 133507. February 17, 2000. *

EUDOSIA DAEZ AND/OR HER HEIRS, REP. BY ADRIANO D. DAEZ, petitioners, vs. THE
HON. COURT OF APPEALS MACARIO SORIENTES, APOLONIO MEDIANA, ROGELIO
MACATULAD and MANUEL UMALI, respondents.
Agrarian Reform Law;Presidential Decree No. 27;Requisites for coverage under the Operation
Land Transfer.—P.D. No. 27, which implemented the Operation Land Transfer (OLT) Program, covers
tenanted rice or corn lands. The requisites for coverage under the OLT program are the following: (1) the
land must be devoted to rice or corn crops; and (2) there must be a system of share-crop or lease-tenancy
obtaining therein. If either requisite is absent, a landowner may apply for exemption. If either of these
requisites is absent, the land is not covered under OLT. Hence, a landowner need not apply for retention
where his ownership over the entire landholding is intact and undisturbed.
Same; Same; Requisites for the exercise by the landowner of his right of retention.—On the other
hand, the requisites for the exercise by the landowner of his right of retention are the following: (1) the
land must be devoted to rice or corn crops; (2) there must be a system of share-crop or lease-tenancy
obtaining therein; and (3) the size of the landholding must not exceed twenty-four (24) hectares, or it
could be more than twenty-four (24) hectares provided that at least seven (7) hectares thereof are covered
lands and more than seven (7) hectares of it consist of “other agricultural lands.”
Same; Same; Same;Landowners who have not yet exercised their retention rights under Presidential
Decree No. 27 are entitled to the new retention rights under Republic Act No. 6657.—In the landmark
case of Association of Small Landowners in the Phil., Inc. v. Secretary of Agrarian Reform, we held that
landowners who have not yet exercised their retention rights under P.D. No. 27 are entitled to the new
retention rights under R.A. No. 6657. We disregarded the August 27, 1985 deadline imposed by DAR
Administrative Order No. 1, series of 1985 on landowners covered by OLT. However, if a landowner
filed his application for retention after August 27, 1985 but he had previously filed the sworn statements
required by LOI Nos. 41, 45 and 52, he is still entitled to the retention limit of seven (7) hectares under
P.D. No. 27. Otherwise, he is only entitled to retain five (5) hectares under R.A. No. 6657.

PETITION for review on certiorari of a decision of the Court of Appeals.

The facts are stated in the opinion of the Court.


Pio T. Rodulfo III for petitioner.
Orquillas and Associates for private respondents.

DE LEON, JR., J.:

Before us is a petition for review on certiorari of the Decision of the Court of Appeals dated
1 2

January 28, 1998 which denied the application of petitioner heirs of Eudosia Daez for the
retention of a 4.1685-hectare riceland pursuant to Republic Act (R.A.) No. 6657, otherwise
known as the Comprehensive Agrarian Reform Law, thereby reversing the Decision of then
3 4

Executive Secretary Ruben D. Torres and the Order of then Deputy Executive Secretary Renato
5

C. Corona, both of which had earlier set aside the Resolution and Order of then Department of
6 7

Agrarian Reform (DAR) Secretary Ernesto D. Garilao denying exemption of the same riceland
from coverage under Presidential Decree (P.D.) No. 27.
The pertinent facts are:
Eudosia Daez, now deceased, was the owner of a 4.1685-hectare riceland in Barangay Lawa,
Meycauayan, Bulacan which was being cultivated by respondents Macario Soriente, Rogelio
Macatulad, Apolonio Mediana and Manuel Umali under a system of share-tenancy. The said
land was subjected to the Operation Land Transfer (OLT) Program under Presidential Decree
(P.D.) No. 27 as amended by Letter of Instruction (LOI) No. 474. Thus, the then Ministry of
8 9

Agrarian Reform acquired the subject land and issued Certificates of Land Transfer (CLT) on
December 9, 1980 to private respondents as beneficiaries.
However, on May 31, 1981, private respondents signed an affidavit, allegedly under duress,
stating that they are not share tenants but hired laborers Armed with such document, Eudosia
10

Daez applied for the exemption of said riceland from coverage of P.D. No. 27 due to non-
tenancy as well as for the cancellation of the CLTs issued to private respondents.
In their Affidavit dated October 2, 1983, Eudosia Daez and her husband, Lope, declared
ownership over 41.8064 hectares of agricultural lands located in Meycauayan, Bulacan and
fourteen (14) hectares of riceland, sixteen (16) hectares of forestland, ten (10) hectares of
“batuhan” and 1.8064 hectares of residential lands in Penaranda, Nueva Ecija. Included in their
11

41.8064-hectare landholding in Bulacan, was the subject 4.1685-hectare riceland in Meycauayan.


On July 27, 1987, DAR Undersecretary Jose C. Medina issued an Order denying Eudosia
Daez’s application for exemption upon finding that her subject land is covered under LOI No.
474, petitioner being owner of the aforesaid agricultural lands exceeding seven (7) hectares. 12
On June 29, 1989, Eudosia Daez wrote a letter to DAR Secretary Benjamin T. Leong
requesting for reconsideration of Undersecretary Medina’s order. But on January 16,
1992 Secretary Leong affirmed the assailed order upon finding private respondents to be
13

bonafide tenants of the subject land. Secretary Leong disregarded private respondents’ May 31,
1981 affidavit for having been executed under duress because he found that Eudosia’s son,
Adriano, who was then the incumbent Vice-Mayor of Meycauayan, pressured private
respondents into signing the same.
Undaunted, Eudosia Daez brought her case on February 20, 1992 to the Court of
Appeals via a petition for certiorari. The Court of Appeals, however, sustained the order of
Secretary Leong in a decision dated April 29, 1992. Eudosia pursued her petition before this
court but we denied it in a minute resolution dated September 18, 1992. We also denied her
motion for reconsideration on November 9, 1992.
Meantime, on August 6 and 12, 1992, the DAR issued Emancipation Patents (EPs) to private
respondents. Thereafter, the Register of Deeds of Bulacan issued the corresponding Transfer
Certificates of Title (TCTs).
Exemption of the 4.1685 riceland from coverage by P.D. No. 27 having been finally denied
her, Eudosia Daez next filed an application for retention of the same riceland, this time under
R.A. No. 6657.
In an order dated March 22, 1994, DAR Region III OIC-Director Eugenio B. Bernardo
allowed Eudosia Daez to retain the subject riceland but he denied the application of her eight (8)
children to retain three (3) hectares each for their failure to prove actual tillage of the land or
direct management thereof as required by law. Aggrieved, they appealed to the DAR. On
14

August 26, 1994, then DAR Secretary Ernesto D. Garilao, set aside the order of Regional
Director Bernardo in a Resolution, the decretal portion of which reads, viz.:
15

“WHEREFORE, premises considered, this Resolution is hereby issued setting aside withFINALITY the
Order dated March 22, 1994 of the Regional Director of DAR Region III.
The records of this case is remanded to the Regional Office for immediate implementation of the
Order dated January 16, 1992 of this office as affirmed by the Court of Appeals and the Supreme Court.
SO ORDERED.”
Eudosia Daez filed a Motion for Reconsideration but it was denied on January 19, 1995. 16

She appealed Secretary Garilao’s decision to the Office of the President which ruled in her
favor. The dispositive portion of the Decision of then Executive Secretary reads:
17

“WHEREFORE, the resolution and order appealed from are hereby SET ASIDE and judgment is
rendered authorizing the retention by Eudosia Daez or her heirs of the 4.1685-hectare landholding subject
thereof.
SO ORDERED.” 18

Aggrieved, private respondents sought from the Court of Appeals, a review of the decision of the
Office of the President.
On January 28, 1999, the said Decision of the Office of the President was reversed. The Court
of Appeals ordered, thus:
“WHEREFORE, the assailed decision of July 5, 1996 and Order dated October 23, 1996 of the public
respondents are REVERSED AND SET ASIDE, and the Resolution and Order of DAR Secretary Ernesto
D. Garilao respectively dated August 26, 1994 and January 19, 1995 are REINSTATED.
SO ORDERED.”
Hence, this petition which assigns the following errors:

1. “I.THE HONORABLE COURT OF APPEALS ERRED WHEN IT RULED THAT


DISTINCTION BETWEEN EXEMPTION FROM AGRARIAN REFORM COVERAGE AND
THE RIGHT OF RETENTION OF LANDOWNERS IS ONLY A MATTER OF SEMANTICS
THAT AN ADVERSE DECISION IN THE FORMER WILL FORECLOSE FURTHER
ACTION TO ENFORCE THE LATTER CONSIDERING THAT THEY CONSTITUTE
SEPARATE AND DISTINCT CAUSES OF ACTION AND, THEREFORE, ENFORCEABLE
SEPARATELY AND IN SEQUEL.
2. II.THE HONORABLE COURT OF APPEALS ERRED WHEN IT APPLIED THE PRINCIPLE
OF RES JUDICATA DESPITE THE FACT THAT THE PREVIOUS CASE CITED
(EXEMPTION FROM COVERAGE DUE TO NON-TENANCY) AND THE PRESENT CASE
(RETENTION RIGHT) ARE OF DIFFERENT CAUSES OF ACTION.
3. III.THE HONORABLE COURT OF APPEALS ERRED WHEN IT RULED/OPINED THAT
THERE WAS A CUT-OFF DATE (AUGUST 27, 1985) FOR LANDOWNERS TO APPLY
FOR EXEMPTION OR RETENTION UNDER PD 27 AND THOSE WHO FAILED TO FILE
THEIR APPLICATIONS/PETITIONS ARE DEEMED TO HAVE WAIVED THEIR RIGHTS.
III. THE HONORABLE COURT OF APPEALS ERRED IN DECLARING THAT
PETITIONERS (RESPONDENTS THEREIN) ARE GUILTY OF ESTOPPEL.
4. IV.THE HONORABLE COURT OF APPEALS ERRED WHEN IT RULED THAT THE LAND
SUBJECT OF THIS CASE IS NO LONGER OWNED BY PETITIONERS SINCE PRIVATE
RESPONDENTS HAVE ALREADY BEEN ISSUED NOT ONLY THEIR RESPECTIVE
CERTIFICATES OF LAND TRANSFER BUT ALSO THEIR INDIVIDUAL CERTIFICATES
OF TITLE OVER THE DISPUTED AREA. 19

We grant the petition.


First. Exemption and retention in agrarian reform are two (2) distinct concepts.
P.D. No. 27, which implemented the Operation Land Transfer (OLT) Program, covers
tenanted rice or corn lands. The requisites for coverage under the OLT program are the
following: (1) the land must be devoted to rice or corn crops; and (2) there must be a system of
share-crop or lease-tenancy obtaining therein. If either requisite is absent, a landowner may
apply for exemption. If either of these requisites is absent, the land is not covered under OLT.
Hence, a landowner need not apply for retention where his ownership over the entire landholding
is intact and undisturbed.
P.D. No. 27 grants each tenant of covered lands a five (5) hectare lot, or in case the land is
irrigated, a three (3) hectare lot constituting a family size farm. However, said law allows a
covered landowner to retain not more than seven (7) hectares of his land if his aggregate
landholding does not exceed twenty-four (24) hectares. Otherwise, his entire landholding is
covered without him being entitled to any retention right. 20

Consequently, a landowner may keep his entire covered landholding if its aggregate size does
not exceed the retention limit of seven (7) hectares. In effect, his land will not be covered at all
by the OLT program although all requisites for coverage are present. LOI No. 474 clarified the
effective coverage of OLT to include tenanted rice or corn lands of seven (7) hectares or less, if
the landowner owns other agricultural lands of more than seven (7) hectares. The term “other
agricultural lands” refers to lands other than tenanted rice or corn lands from which the
landowner derives adequate income to support his family.
Thus, on one hand, exemption from coverage of OLT lies if: (1) the land is not devoted to
rice or corn crops even if it is tenanted; or (2) the land is untenanted even though it is devoted to
rice or corn crops.
On the other hand, the requisites for the exercise by the landowner of his right of retention are
the following: (1) the land must be devoted to rice or corn crops; (2) there must be a system of
share-crop or lease-tenancy obtaining therein; and (3) the size of the landholding must not
exceed twenty-four (24) hectares, or it could be more than twenty-four (24) hectares provided
that at least seven (7) hectares thereof are covered lands and more than seven (7) hectares of it
consist of “other agricultural lands.”
Clearly, then, the requisites for the grant of an application for exemption from coverage of
OLT and those for the grant of an application for the exercise of a landowner’s right of retention,
are different.
Hence, it is incorrect to posit that an application for exemption and an application for
retention are one and the same thing. Being distinct remedies, finality of judgment in one does
not preclude the subsequent institution of the other. There was, thus, no procedural impediment
to the application filed by Eudosia Daez for the retention of the subject 4.1865-hectare riceland,
even after her appeal for exemption of the same land was denied in a decision that became final
and executory.
Second. Petitioner heirs of Eudosia Daez may exercise their right of retention over the subject
4.1685 riceland.
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
21

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. A retained area, as its name
22

denotes, is land which is not supposed to anymore leave the landowner’s dominion, thus sparing
the government from the inconvenience of taking land only to return it to the landowner
afterwards, which would be a pointless process.
In the landmark case ofAssociation of Small Landowners in the Phils., Inc. v. Secretary of
Agrarian Reform, we held that landowners who have not yet exercised their retention rights
23

under P.D. No. 27 are entitled to the new retention rights under R.A. No. 6657. We disregarded
24

the August 27, 1985 deadline imposed by DAR Administrative Order No. 1, series of 1985 on
landowners covered by OLT. However, if a landowner filed his application for retention after
August 27, 1985 but he had previously filed the sworn statements required by LOI Nos. 41, 45
and 52, he is still entitled to the retention limit of seven (7) hectares under P.D. No.
27. Otherwise, he is only entitled to retain five (5) hectares under R.A. No. 6657.
25

Sec. 6 of R.A. No. 6657, which provides, viz.:


SECTION 6. Retention Limits—Except as 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-size, 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 or directly managing the farm; Provided, That landowners
whose land have been covered by Presidential Decree No. 27 shall be allowed to keep the area originally
retained by them thereunder, 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.
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 retention by the landowner is tenanted,
the tenant shall have the option to choose whether to remain therein or be a beneficiary in the same or
another agricultural land with similar or comparable features. In case the tenant chooses to remain in the
retained area, he shall be considered a leaseholder and shall lose his right to be a beneficiary under this
Act. In case the tenant chooses to be a beneficiary in another agricultural land, he loses his right as a
lease-holder to the land retained by the landowner.The tenant must exercise this option within a period of
one (1) year from the time the landowner manifests his choice of the area for retention.
In all cases, the security of tenure of the farmers or farmworkers on the land prior to the approval of
this Act shall be respected.
Upon the effectivity of this Act, any sale, disposition, lease, management contract or transfer of
possession of private lands executed by the original landowner in violation of this Act shall be null and
void; Provided, however, That those executed prior to this Act shall be valid only when registered with
the Register of Deeds within a period of three (3) months after the effectivity of this Act. Thereafter, all
Register of Deeds shall inform the DAR within thirty (30) days of any transaction involving agricultural
lands in excess of five (5) hectares.”
26

defines the nature and incidents of a landowner’s right of retention. For as long as the area to be
retained is compact or contiguous and it does not exceed the retention ceiling of five (5) hectares,
a landowner’s choice of the area to be retained, must prevail. Moreover, Administrative Order
No. 4, series of 1991, which supplies the details for the exercise of a landowner’s retention
27

rights, likewise recognizes no limit to the prerogative of the landowner, although he is persuaded
to retain other lands instead to avoid dislocation of farmers. Without doubt, this right of retention
may be exercised over tenanted land despite even the issuance of Certificate of Land Transfer
(CLT) to farmer-beneficiaries.28 What must be protected, however, is the right of the tenants to
opt 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. 29

Finally. Land awards made pursuant to the government’s agrarian reform program are subject
to the exercise by a landowner, who is so qualified, of his right of retention.
Under P.D. No. 27, beneficiaries are issued CLTs to entitle them to possess lands. Thereafter,
they are issued Emancipation Patents (EPs) after compliance with all necessary conditions. Such
EPs, upon their presentation to the Register of Deeds, result in the issuance of the corresponding
transfer certificates of title (TCT) in favor of the beneficiaries mentioned therein. 30

Under R.A. No. 6657, the procedure has been simplified Only Certificates of Land
31

Ownership Award (CLOAs) are issued, in lieu of EPs, after compliance with all prerequisites.
Thereafter, upon presentation of the CLOAs to the Register of Deeds, TCTs are issued to the
designated beneficiaries. CLTs are no longer issued.
The issuance of EPs or CLOAs to beneficiaries does not absolutely bar the landowner from
retaining the area covered thereby. Under Administrative Order No. 2, series of 1994, an EP or
32

CLOA may be cancelled if the land covered is later found to be part of the landowner’s retained
area.
A certificate of title accumulates in one document a comprehensive statement of the status of
the fee held by the owner of a parcel of land. As such, it is a mere evidence of ownership and it
33

does not constitute the title to the land itself. It cannot confer title where no title has been
acquired by any of the means provided by law. 34

Thus, we had, in the past, sustained the nullification of a certificate of title issued pursuant to
a homestead patent because the land covered was not part of the public domain and as a result,
the government had no authority to issue such patent in the first place. Fraud in the issuance of
35

the patent, is also a ground for impugning the validity of a certificate of title. In other words, the
36

invalidity of the patent or title is sufficient basis for nullifying the certificate of title since the
latter is merely an evidence of the former.
In the instant case, the CLTs of private respondents over the subject 4.1685-hectare riceland
were issued without Eudosia Daez having been accorded her right of choice as to what to retain
among her landholdings. The transfer certificates of title thus issued on the basis of those CLTs
cannot operate to defeat the right of the heirs of deceased Eudosia Daez to retain the said 4.1685
hectares of riceland.
WHEREFORE, the instant petition is hereby GRANTED. The Decision of the Court of
Appeals, dated January 28, 1998, is REVERSED and SET ASIDE and the Decision of the Office
of the President, dated July 5, 1996, is hereby REINSTATED. In the implementation of said
decision, however, the Department of Agrarian Reform is hereby ORDERED to fully accord to
private respondents their rights under Section 6 of R.A. No. 6657.
No costs. SO ORDERED.
Bellosillo (Chairman)and Mendoza, JJ., concur.
Quisumbing, J., No part. Prior official action.
Buena, J., On leave.
Petition granted, judgment reversed and set aside. Decision of Office of the President
reinstated.
Note.—The exercise of the rights of ownership are subject to limitations that may be imposed
by law, such as the Tenancy Act and Presidential Decree No. 27. (Philippine National Bank vs.
Court of Appeals, 275 SCRA 70 [1997])

G.R. No. 203204. November 20, 2013.*


HEIRS OF ROMULO D. SANDUETA, namely: GLORIA SANDUETA ELOPRE, HEIRS OF
JOSEPHINE S. NADALA, represented by ROY S. NADALA, HOFBOWER SANDUETA,
NERISA SANDUETA MICUBO, OSCAR SANDUETA, MARILYN SANDUETA VELASCO,
RONALD SANDUETA, and NAPOLEON SANDUETA, petitioners, vs. DOMINGO ROBLES,
HEIRS OF TEODORO ABAN, namely: NERIO ABAN, VIRGINIO ABAN, SUSANA ABAN,
and DAVID ABAN; HEIRS OF EUFRECENA** GALEZA, namely: CESAR GALEZA,
NESTOR GALEZA, ANGELA GALEZA, JUSTO GALEZA, KIA GALEZA PONCE,
PORFERIA GALEZA NALZARO, ROSARIO GALEZA VELASCO, HERMINIA GALEZA
GUERRERO, and NONA GALEZA NACARIO, respondents.

Agrarian Reform; Right of Retention; The right of retention, as protected and enshrined in the
Constitution, balances the effects of compulsory land acquisition by granting the landowner the right to
choose the area to be retained subject to legislative standards.―The right of retention, as protected and
enshrined in the Constitution, balances the effects of compulsory land acquisition by granting the
landowner the right to choose the area to be retained subject to legislative standards. Necessarily, since
the said right is granted to limit the effects of compulsory land acquisition against the landowner, it is a
prerequisite that the land falls under the coverage of the OLT Program of the government. If the land is
beyond the ambit of the OLT Program, the landowner need not — as he should not — apply for retention
since the appropriate remedy would be for him to apply for exemption. As explained in the case of Daez
v. CA (Daez), 325 SCRA 856 (2000): Exemption and retention in agrarian reform are two (2) distinct
concepts. P.D. No. 27, which implemented the Operation Land Transfer (OLT) Program, covers tenanted
rice or corn lands. The requisites for coverage under the OLT program are the following: (1) the land
must be devoted to rice or corn crops; and (2) there must be a system of share-crop or lease-tenancy
obtaining therein. If either requisite is absent, a landowner may apply for exemption. If either of these
requisites is absent, the land is not covered under OLT. Hence, a landowner need not apply for
retention where his ownership over the entire landholding is intact and undisturbed.
Same; Same; Section 6 of RA 6657 states that covered landowners are allowed to retain a portion of
their tenanted agricultural land not, however, to exceed an area of five (5) has. and, further thereto,
provides that an additional three (3) has. 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.―If the land is covered by the OLT Program which hence,
renders the right of retention operable, PD 27 — issued on October 21, 1972 — confers in favor of
covered landowners who cultivate or intend to cultivate an area of their tenanted rice or corn land the
right to retain an area of not more than seven (7) has. thereof. Subsequently, or on June 10, 1998,
Congress passed RA 6657 which modified the retention limits under PD 27. In particular, Section 6 of
RA 6657 states that covered landowners are allowed to retain a portion of their tenanted agricultural land
not, however, to exceed an area of five (5) has. and, further thereto, provides that an additional three (3)
has. 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.
Same; Same; While landowners who have not yet exercised their retention rights under PD 27 are
entitled to new retention rights provided for by RA 6657, the limitations under LOI 474 would equally
apply to a landowner who filed an application under RA 6657.―It may be readily observed that LOI 474
amended PD 27 by removing any right of retention from persons who own: (a) other agricultural
lands of more than seven (7) has. in aggregate areas; or (b) lands used for residential, commercial,
industrial or other urban purposes from which they derive adequate income to support themselves and
their families. To clarify, in Santiago v. Ortiz-Luis, 630 SCRA 670 (2010), the Court, citing the cases
of Ass’n. of Small Landowners in the Phils., Inc. v. Hon. Secretary of Agrarian Reform, 175 SCRA 343
(1989), and Heirs of Aurelio Reyes v. Garilao, 605 SCRA 294 (2009), stated that while landowners who
have not yet exercised their retention rights under PD 27 are entitled to new retention rights provided for
by RA 6657, the limitations under LOI 474 would equally apply to a landowner who filed an application
under RA 6657.
PETITION for review on certiorari of a decision of the Court of Appeals, Cagayan de Oro City.
The facts are stated in the opinion of the Court.
Benedicto O. Cainta for petitioners.
Osias Ochavo for respondents.

RESOLUTION

PERLAS-BERNABE, J.:
Assailed in this petition for review on certiorari1 is the Decision2 dated April 26, 2012 of the
Court of Appeals, Cagayan de Oro City (CA) in CA-G.R. SP No. 03333 which affirmed
DARCO Order No. RT-0911-4143 dated November 24, 2009 (November 24, 2009 DARCO
Order) issued by former Department of Agrarian Reform (DAR) Secretary Nasser C.
Pangandaman (Secretary Pangandaman).
The Facts
Petitioners are the heirs of Romulo and Isabel Sandueta (Sps. Sandueta) who died intestate in
1987 and 1996, respectively, and accordingly inherited several agricultural lands situated in
Dipolog City, Zamboanga del Norte, with a total land area of 18.7433 hectares (has.).4One of
these parcels of land is Lot No. 3419, with an area of 13.7554 has.5 covered by Transfer
Certificate of Title (TCT) No. T-5988.6 The 4.6523-hectare riceland portion (subject portion) of
the foregoing lot was tenanted by Eufrecena Galeza, Teodoro Aban, and Domingo
Pableo7 (tenants) who were instituted as such by the original owner, Diosdado Jasmin, prior to its
sale to Sps. Sandueta.8
The subject portion was placed under the government’s Operation Land Transfer (OLT)
Program pursuant to Presidential Decree No. (PD) 279 and consequently awarded to the above-
named tenants who were issued the corresponding Emancipation Patents (EPs).10

The Proceedings Before the DAR


On July 7, 2005, petitioners filed before the DAR District Office in Dipolog City a
petition11seeking to exercise their right of retention over the subject portion pursuant to Section 6
of Republic Act No. (RA) 6657,12 known as the Comprehensive Agrarian Reform Law of 1988,
and as enumerated in the case ofAss’n. of Small Landowners in the Phils., Inc. v. Hon. Secretary
of Agrarian Reform13 (Ass’n. of Small Landowners). They also sought to annul the EPs of the
tenants as well as compel the tenants to pay back rentals.14
The Provincial Protest Application and Resolution Unit referred the case to the Municipal
Agrarian Reform Officer of Dipolog City who, after investigation, recommended the denial of
the petition.15 On the other hand, the Provincial Agrarian Reform Officer (PARO), while
similarly recommending the denial of the petition for retention, nevertheless recommended the
grant of a 5-hectare retention area for petitioners to be taken from the portion of Lot No. 3419
not covered by the OLT Program.16
On April 5, 2006, the DAR Regional Office No. IX, through Regional Director Julita R.
Ragandang (Director Ragandang) issued an Order17 (April 5, 2006 Order) adopting the PARO’s
recommendation. Director Ragandang explained that a landowner who failed to exercise his right
of retention under PD 27 can avail of the right to retain an area not exceeding 5 has pursuant to
Section 6 of RA 6657,18 adding that this award is different from that which may be granted to the
children of the landowner, to the extent of 3 has. each, in their own right as
beneficiaries.19 However, to be entitled thereto, each child must meet the age qualification and
requirement of actual cultivation of the land or direct management of the farm under Section 6,
as well as the other conditions under Section 2220 of RA 6657. As petitioners were absentee
landowners who had left the cultivation of the subject portion entirely to the tenants, Director
Ragandang therefore concluded that they are not entitled to exercise retention rights
thereon21 and, hence, denied their petition for retention. Despite such denial, Director Ragandang
granted the decedent Romulo Sandueta the right to retain 5 has. from the portion of Lot No. 3419
not covered by the OLT Program.
Dissatisfied, petitioners filed a motion for reconsideration, essentially arguing that their right
to choose the retention area is guaranteed by Section 6 of RA 6657. In an Order22 dated July 14,
2006, Director Ragandang denied the motion and explained that landowners covered by PD 27
who failed to exercise their right of retention which subsequently led to the distribution of the
EPs to the tenants, have no right to choose the area to be retained.23 Moreover, she pointed out
that under Letter of Instruction No. 474 (LOI 474), landowners who own less than 24 has. of
tenanted rice lands but additionally own more than 7 has. of other agricultural lands may not
retain their tenanted rice lands.24 Since petitioners failed to exercise their right or manifest their
intention of retention prior to the issuance of their tenants’ EPs and considering further that they
own about 14.0910 has. of other agricultural
_______________
If, due to landowner’s retention rights or to the number of tenants, lessees, or workers on the land, there is not enough
land to accommodate any or some of them, they may be granted ownership of other lands available for distribution under
this Act, at the option of the beneficiaries.
Farmers already in place and those not accommodated in the distribution of privately-owned lands will be given
preferential rights in the distribution of lands from the public domain.
21 CA Rollo, p. 29.
22 Id., at pp. 32-36.
23 Id., at p. 35. In consonance with DAR Administrative Order No. 05, series of 2000 (Revised Rules and Procedures
for the Exercise of Retention Right by Landowners).
24 Id., at p. 34.

498lands, Director Ragandang declared them to have no right to choose their retained area of 5
has., which can be accommodated in their other landholdings not covered under the OLT
Program.25
On appeal, Secretary Pangandaman issued the November 24, 2009 DARCO Order
affirming in totoDirector Ragandang’s April 5, 2006 Order.
The CA Ruling
In a Decision26 dated April 26, 2012, the CA (a) held that the subject portion was
appropriately covered by the OLT Program pursuant to LOI 474; (b) declared that petitioners do
not have the absolute right to choose their retention area considering their ownership of 14.0910
has. of other agricultural lands; and (c) affirmed Secretary Pangandaman’s dismissal of the
petition for retention under Section 6 of RA 6657.27
On May 31, 2012, petitioners filed a motion for reconsideration28 which was denied by the
CA in a Resolution29 dated August 14, 2012. Hence, the instant petition.
The Issue Before the Court
The essential issue in this case is whether or not petitioners are entitled to avail of any
retention right under Section 6 of RA 6657.
_______________
25 Id., at pp. 34-35.
26 Rollo, pp. 31-38.
27 Id., at pp. 37-38.
28 CA Rollo, pp. 156-160. Dated May 21, 2012.
29 Id., at pp. 39-40. Penned by Associate Justice Edgardo T. Lloren, with Associate Justices Edgardo A. Camello and
Maria Elisa Sempio Diy, concurring.

499
The Court’s Ruling
The right of retention, as protected and enshrined in the Constitution, balances the effects of
compulsory land acquisition by granting the landowner the right to choose the area to be retained
subject to legislative standards.30 Necessarily, since the said right is granted to limit the effects of
compulsory land acquisition against the landowner, it is a prerequisite that the land falls under
the coverage of the OLT Program of the government. If the land is beyond the ambit of the OLT
Program, the landowner need not — as he should not — apply for retention since the appropriate
remedy would be for him to apply for exemption. As explained in the case of Daez v.
CA31(Daez):
Exemption and retention in agrarian reform are two (2) distinct concepts.
P.D. No. 27, which implemented the Operation Land Transfer (OLT) Program, covers tenanted
rice or corn lands. The requisites for coverage under the OLT program are the following: (1) the
land must be devoted to rice or corn crops; and (2) there must be a system of
_______________
30 Santiago v. Ortiz-Luis, G.R. Nos. 186184 & 186988, September 20, 2010, 630 SCRA 670, 678, citing Section 4, Article
XIII of the 1987 Philippine Constitution which reads as follows: “The State shall, by law, undertake an agrarian reform program
founded on the right of farmers and regular farmworkers, who are landless, to own directly or collectively the lands they till or, in
the case of other farmworkers, to receive a just share of the fruits thereof. To this end, the State shall encourage and undertake the
just distribution of all agricultural lands, subject to such priorities and reasonable retention limits as the Congress may
prescribe, taking into account ecological, developmental or equity considerations and subject to the payment of just
compensation. In determining retention limits, the State shall respect the right of small landowners. The State shall further
provide incentives for voluntary land-sharing.” (Emphasis supplied)
31 382 Phil. 742; 325 SCRA 856 (2000).
500share-crop or lease-tenancy obtaining therein. If either requisite is absent, a landowner may
apply for exemption. If either of these requisites is absent, the land is not covered under OLT.
Hence, a landowner need not apply for retentionwhere his ownership over the entire
landholding is intact and undisturbed. (Emphasis and underscoring supplied)

If the land is covered by the OLT Program which hence, renders the right of retention
operable, PD 27 — issued on October 21, 1972 — confers in favor of covered landowners who
cultivate or intend to cultivate an area of their tenanted rice or corn land the right to retain an
area of not more than seven (7) has. thereof.32Subsequently, or on June 10, 1998, Congress
passed RA 6657 which modified the retention limits under PD 27. In particular, Section 6 of RA
6657 states that covered landowners are allowed to retain a portion of their tenanted agricultural
land not, however, to exceed an area of five (5) has. and, further thereto, provides that an
additional three (3) has. 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.33 In the case of Heirs of
_______________
32 PD 27 provides:
xxxx
The tenant farmer, whether in land classified as landed estate or not, shall be deemed owner of a portion
constituting a family-size farm of five (5) hectares if not irrigated and three (3) hectares if irrigated;
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;
x x x x.
33 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,

501Aurelio Reyes v. Garilao34(Reyes), however, the Court held that a landowner’s retention
rights under RA 6657 are restricted by the conditions set forth in LOI 474 issued on October 21,
1976 which reads:
WHEREAS, last year I ordered that small landowners of tenanted rice/corn lands with areas
of less than twenty-four hectares but above seven hectares shall retain not more than seven
hectares of such lands except when they own other agricultural lands containing more than
seven hectares or land
_______________
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.
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 retention by the landowner is tenanted, the tenant shall have the option to choose
whether to remain therein or be a beneficiary in the same or another agricultural land with similar or comparable features. In case
the tenant chooses to remain in the retained area, he shall be considered a leaseholder and shall lose his right to be a beneficiary
under this Act. In case the tenant chooses to be a beneficiary in another agricultural land, he loses his right as a leaseholder to the
land retained by the landowner. The tenant must exercise this option within a period of one (1) year from the time the landowner
manifests his choice of the area for retention.
34 See G.R. No. 136466, November 25, 2009, 605 SCRA 294, 304.

502used for residential, commercial, industrial or other urban purposes from which they
derive adequate income to support themselves and their families;
WHEREAS, the Department of Agrarian Reform found that in the course of implementing my
directive there are many landowners of tenanted rice/corn lands with areas of seven hectares or less
who also own other agricultural lands containing more than seven hectares or lands used for
residential, commercial, industrial or other urban purposes where they derive adequate income to
support themselves and their families;
WHEREAS, it is therefore necessary to cover said lands under the Land Transfer Program of the
government to emancipate the tenant-farmers therein.
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, do hereby order
the following:
1. You shall undertake to place under the Land Transfer Program of the
governmentpursuant to Presidential Decree No. 27, all tenanted rice/corn lands with areas of
seven hectares or less belonging to landowners who own other agricultural lands of more
than seven hectares in aggregate areas or lands used for residential, commercial, industrial
or other urban purposes from which they derive adequate income to support themselves and
their families.
2. Landowners who may choose to be paid the cost of their lands by the Land Bank of the
Philippines shall be paid in accordance with the mode of payment provided in Letter of
Instructions No. 273 dated May 7, 1973.35 (Emphases and underscoring supplied)

_______________
35 LOI 474 dated October 21, 1976. See also Ministry Memorandum Circular No. 18-81 entitled, “Clarificatory
Guidelines on Coverage of P.D. No. 27 and Retention by Small Landowners.”

503Based on the above-cited provisions, it may be readily observed that LOI 474 amended
PD 27 by removing any right of retention from persons who own:
(a) other agricultural lands of more than seven (7) has. in aggregate areas; or
(b) lands used for residential, commercial, industrial or other urban purposes from which
they derive adequate income to support themselves and their families.
To clarify, in Santiago v. Ortiz-Luis,36 the Court, citing the cases of Ass’n. of Small
Landowners37 and Reyes,38stated that while landowners who have not yet exercised their retention
rights under PD 27 are entitled to new retention rights provided for by RA 6657, the limitations
under LOI 474 would equally apply to a landowner who filed an application under RA 6657.
In this case, records reveal that aside from the 4.6523-hectare tenanted riceland covered by
the OLT Program, i.e., the subject portion, petitioners’ predecessors-in-interest, Sps. Sandueta,
own other agricultural lands with a total area of 14.0910 has. which therefore triggers the
application of the first disqualifying condition under LOI 474 as above-highlighted. As such,
petitioners, being mere successors-in-interest, cannot be said to have acquired any retention
right to the subject portion. Accordingly, the subject portion would fall under the complete
coverage of the OLT Program hence, the 5 and 3-hectare retention limits as well as the
landowner’s right to choose the area to be retained under Section 6 of RA 6657 would not apply
altogether.
Nevertheless, while the CA properly upheld the denial of the petition for retention, the Court
must point out that the November 24, 2009 DARCO Order inaccurately phrased Romulo
Sandueta’s entitlement to the remaining 14.0910-
_______________
36 Supra note 30, at p. 681.
37 Supra note 13, at p. 826; p. 392.
38 Supra note 34, at p. 313.

504hectare landholding, outside of the 4.6523-hectare subject portion, as a vestige of his


retention right. Since the 14.0910-hectare landholding was not shown to be tenanted and hence,
outside the coverage of the OLT Program, there would be no right of retention, in its technical
sense, to speak of. Keeping with the Court’s elucidation in Daez, retention is an agrarian reform
law concept which is only applicable when the land is covered by the OLT Program; this is not,
however, the case with respect to the 14.0910-hectare landholding. Thus, if only to correct any
confusion in terminology, Romulo Sandueta’s right over the 14.0910-hectare landholding should
not be deemed to be pursuant to any retention right but rather to his ordinary right of ownership
as it appears from the findings of the DAR that the landholding is not covered by the OLT
Program.
WHEREFORE, the petition is DENIED. Accordingly, the Decision dated April 26, 2012 of
the Court of Appeals, Cagayan de Oro City in CA-G.R. SP No. 03333 insofar as it upheld the
denial of the petition for retention in this case is hereby AFFIRMED.
SO ORDERED.
Carpio (Chairperson), Brion, Del Castillo and Perez, JJ., concur.

Petition denied, judgment affirmed.

Notes.―The right of retention, as protected and enshrined in the Constitution, balances the
effect of compulsory land acquisition by granting the landowner the right to choose the area to be
retained subject to legislative standards. (Santiago vs. Ortiz-Luis, 630 SCRA 670 [2010])
Landowners who have not yet exercised their retention rights under Presidential Decree No.
27 are entitled to new retention rights provided for by Republic Act No. 6657. (Ibid.)

G.R. No. 199008. November 19, 2014.*


DANILO ALMERO, TERESITA ALAGON, CELIA BULASO, LUDY RAMADA, REGINA
GEGREMOSA, ISIDRO LAZARTE, THELMA EMBARQUE, FELIPE LAZARTE,
GUILERMA LAZARTE, DULCESIMA BENIMELE, petitioners, vs.HEIRS OF MIGUEL
PACQUING, as represented by LINDA PACQUINGFADRILAN, respondents.

Remedial Law; Civil Procedure; Appeals; Under Rule 43 of the Rules of Court, an appeal from the
awards, judgments, final orders or resolutions of or authorized by any quasi-judicial agency such as the
Office of the President (OP), in the exercise of its quasi-judicial functions shall be filed to the Court of
Appeals (CA)within a period of fifteen (15) days from notice of, publication or denial of a motion for new
trial or reconsideration.—Under Rule 43 of the Rules of Court, an appeal from the awards, judgments,
final orders or resolutions of or authorized by any quasi-judicial agency such as the Office of the
President, in the exercise of its quasi-judicial functions shall be filed to the CA within a period of fifteen
(15) days from notice of, publication or denial of a motion for new trial or reconsideration. The appeal
may involve questions of fact, of law, or mixed questions of fact and law.
Same; Same; Same; A direct resort to the Supreme Court (SC) may be allowed in cases where only
questions of law are raised.—A

_______________

* SECOND DIVISION.

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direct resort to this Court, however, may be allowed in cases where only questions of law are
raised. A question of law exists when the doubt or controversy concerns the correct application of law or
jurisprudence to a certain set of facts; or when the issue does not call for an examination of the probative
value of the evidence presented, the truth or falsehood of facts being admitted.
Agrarian Reform; Comprehensive Agrarian Reform Law; Republic Act (RA) No. 6657 or the
Comprehensive Agrarian Reform Law (CARL) of 1988 covers all public and private agricultural lands as
provided in Proclamation No. 131 and Executive Order (E.O.) No. 229,including other lands of the
public domain suitable for agriculture.—R.A. No. 6657 or the Comprehensive Agrarian Reform Law
(CARL) of 1988 covers all public and private agricultural lands as provided in Proclamation No. 131 and
E.O. No. 229, including other lands of the public domain suitable for agriculture. Section 4 of R.A. 6657,
as amended, specifically lists the lands covered by the CARP, which include: (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 to 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.
Same; Same; Section 10 of Republic Act (RA) No. 6657, as amended, expressly provides for the
lands exempted or excluded from the Comprehensive Agrarian Reform Program (CARP).—Section 10 of
R.A. 6657, as amended, expressly provides for the lands exempted or excluded from the CARP, namely:
(a) Lands actually, directly and exclusively used for parks, wildlife, forest reserves, reforestation, fish
sanctuaries and breeding grounds, watersheds and mangroves shall be exempt from the coverage of this
Act; (b) Private lands actually, directly and exclusively used for prawn farms 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 (CLOA) issued under the Agrarian Reform Pro-

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gram; and x x x x (c) Lands actually, directly and exclusively used and found to be necessary for
national defense, school sites and campuses, including experimental farms stations operated by public or
private schools for educational purposes, seeds and seedlings research and pilot production centers,
church sites and covenants appurtenant thereto, mosque sites and Islamic centers appurtenant thereto,
communal burial grounds and cemeteries, penal colonies and penal farms actually worked by the inmates,
government and private research and quarantine centers and all lands with eighteen percent (18%) slope
and over, except those already developed, shall be exempt from the coverage of this Act.
Same; Same; Homesteads; Conditions for Retention of Homestead by the Grantees or their
Compulsory Heirs.—In order for the homestead grantees or their direct compulsory heirs to retain or keep
their homestead, the following conditions must first be satisfied: (a) they must still be the owners of the
original homestead at the time of the CARL’s effectivity, and (b) they must continue to cultivate the
homestead land. In this case, Linda, as the direct compulsory heir of the original homestead grantee, is no
longer cultivating the subject homestead land. The OP misinterpreted our ruling inParis v. Alfeche, 364
SCRA 110 (2001), when it held that Linda’s mere expression of her desire to continue or to start anew
with the cultivation of the land would suffice to exempt the subject homestead land from the CARL.

Leonen, J., Dissenting Opinion:


Remedial Law; Civil Procedure; Appeals; Petition for Review on Certiorari; Court of Appeals;
View that under Rule 43 of the Rules of Court, decisions of the Office of the President (OP) are appealed
before the Court of Appeals (CA) through a Petition for Review raising questions of fact, of law, or mixed
questions of fact and law.—Under Rule 43 of the Rules of Court, decisions of the Office of the President
are appealed before the Court of Appeals through a Petition for Review raising questions of fact, of law,
or mixed questions of fact and law. The Appeal must be filed within 15 days from notice of the decision
or resolution denying the Motion for Reconsideration as provided in Rule 43, Sections 1 and 4.

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Same; Same; Same; Same; View that under Rule 45, Section 2 of the Rules of Court, a Petition for
Review on Certiorari must be filed within fifteen (15) days from notice of the assailed Decision or
Resolution.—It is true that a Petition for Review on Certiorari may be directly filed before this court if
the Petition raises pure questions of law. However, even assuming that Almero, et al.’s Petition raises
pure questions of law, this court should have dismissed outright Almero, et al.’s Petition for having been
filed out of time. Under Rule 45, Section 2 of the Rules of Court, a Petition for Review
on Certiorari must be filed within 15 days from notice of the assailed Decision or Resolution.
Agrarian Reform; Words and Phrases; View that agrarian reform is the “redistribution of lands,
regardless of crops or fruits produced, to farmers and regular farmworkers who are landless.”—
Agrarian reform is the “redistribution of lands, regardless of crops or fruits produced, to farmers and
regular farmworkers who are landless.” It includes not only the physical redistribution of lands but also
other alternative arrangements, such as production or profit-sharing, labor administration, and the
redistribution of shares of stock all aimed to lift the economic status of the property’s farmer-
beneficiaries.
Same; View that as a general rule, all agricultural lands, whether public or private, are covered by
the Comprehensive Agrarian Reform Program (CARP).—As a general rule, all agricultural lands,
whether public or private, are covered by the Comprehensive Agrarian Reform Program. An agricultural
land refers to land devoted to any of the following agricultural activities: 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.
Same; Comprehensive Agrarian Reform Law; View that Section 10 of the Comprehensive Agrarian
Reform Law (CARL) provides for the properties exempt from agrarian reform coverage.—As for the
properties exempt from agrarian reform coverage, Section 10 of the Comprehensive Agrarian Reform
Law provides: SEC. 10. Exemptions and Exclusions.—Lands actually, directly and exclusively used and

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found to be necessary for parks, wildlife, forest reserves, reforestation, fish sanctuaries and breeding
grounds, watersheds and mangroves, national defense, school sites and campuses including experimental
farm stations operated by public or private schools for educational purposes, seeds and seedlings research
and pilot production centers, church sites and convents appurtenant thereto, mosque sites and Islamic
centers appurtenant thereto, communal burial grounds and cemeteries, penal colonies and penal farms
actually worked by the inmates, government and private research and quarantine centers and all lands
with eighteen percent (18%) slope and over, except those already developed shall be exempt from the
coverage of this Act.
Same; Constitutional Law; View that under Article XIII, Section 6 of the Constitution, distribution of
lands through agrarian reform is “subject to prior rights, homestead rights of small settlers, and the
rights of indigenous cultural communities to their ancestral lands.”—Although a social justice measure,
agrarian reform is subject to limitations. Under Article XIII, Section 6 of the Constitution, distribution of
lands through agrarian reform is “subject to prior rights, homestead rights of small settlers, and the rights
of indigenous cultural communities to their ancestral lands”: Section6. The State shall apply the principles
of agrarian reform or stewardship, whenever applicable in accordance with law, in the disposition or
utilization of other natural resources, including lands of the public domain under lease or concession
suitable to agriculture, subject to prior rights, homestead rights of small settlers, and the rights of
indigenous cultural communities to their ancestral lands.
Same; Homesteads; View that under Section 12 of the Public Land Act, an applicant “may enter a
homestead of not exceeding twenty-four (24) hectares of agricultural land of the public domain.”—
Chapter IV of Commonwealth Act No. 141 or the Public Land Act governs the grant of homestead
patents. Under Section 12 of the law, an applicant “may enter a homestead of not exceeding twenty-four
hectares of agricultural land of the public domain.” A homestead patent or title to the homestead is issued
only if the applicant has improved and cultivated at least one-fifth of the agricultural land applied for.

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Same; Same; View that the state grants homestead rights “to encourage residence upon and the
cultivation and improvement of [agricultural lands] of the public domain.”—The state grants homestead
rights “to encourage residence upon and the cultivation and improvement of [agricultural lands] of the
public domain.” In Jocson v. Soriano, 45 Phil. 375 (1923), this court further explained the purpose of
granting and protecting homesteads: [The object of homestead laws] is to provide a home for each citizen
of the Government, where his family may shelter and live beyond the reach of financial misfortune, and
to inculcate in individuals those feelings of independence which are essential to the maintenance of free
institutions. Furthermore, the state itself is concerned that the citizens shall not be divested of a means of
support, and reduced to pauperism. The conservation of a family home is the purpose of homestead laws.
The policy of the state is to foster families as the factors of society, and thus promote general welfare. The
sentiment of patriotism and independence, the spirit of free citizenship, the feeling of interest in public
affairs, are cultivated and fostered more readily when the citizen lives permanently in his own home, with
a sense of its protection and durability.
Same; Same; View that the Supreme Court (SC) affirmed the Court of Appeals’ (CA’s) Decision,
ruling that “parcels of land covered by homestead patents are not automatically exempt from the
operation of land reform.”—This court affirmed the Court of Appeals’ Decision, ruling that “parcels of
land . . . covered by homestead patents [are] not automatically exempt . . . from the operation of land
reform.” Section 6 of the Comprehensive Agrarian Reform Law allows homesteaders to retain their land
“as long as they continue to cultivate [their] homestead.” Therefore, “it is the fact of continued cultivation
by the original grantees or their direct compulsory heirs that shall exempt their lands from land reform
coverage.”
Same; Comprehensive Agrarian Reform Law; View that in providing that homesteaders may retain
their land “as long as they continue to cultivate said homestead,” Section 6 of the Comprehensive
Agrarian Reform Law (CARL) is unconstitutional.—In providing that homesteaders may retain their land
“as long as they continue to cultivate said homestead,” Section 6 of the Comprehensive Agrarian Reform
Law is unconstitutional. The Constitution does not require homesteaders to show their intention to
cultivate their land before

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their properties are exempted from agrarian reform coverage. Under the law, homestead patents are
granted only if the applicants have proven to the satisfaction of the Director of Lands that they have
entered, improved, and cultivated the land applied for. It must therefore be presumed that grantees of
homestead patents cultivate their land.
Same; Same; View that in the alternative, this case must be elevated to the court En Banc
considering that the constitutionality of Section 6 of the Comprehensive Agrarian Reform Law (CARL) is
at issue in this case.—In the alternative, this case must be elevated to the court En Banc considering that
the constitutionality of Section 6 of the Comprehensive Agrarian Reform Law is at issue in this case. Rule
2, Section 3(a) of the Internal Rules of the Supreme Court provides: Section 3. Court En Banc matters
and cases.—The Court En Banc shall act on the following matters and cases: (a) cases in which the
constitutionality or validity of any treaty, international or executive agreement, law, executive order,
presidential decree, proclamation, order, instruction, ordinance, or regulation is in question[.]

PETITION for review on certiorari of the decision and resolution of the Office of the President.
The facts are stated in the opinion of the Court.
Benjamin T. Etulle for petitioners.
Chato & Vinzons-Chatofor respondents.

BRION, J.:

Before this Court is a petition for review oncertiorari1 filed under Rule 45 of the Rules of
Court directly assailing the February 16, 2011 decision2and July 19, 2011 resolution3of the Office
of the President (OP) in OP Case No. 10-C-152. The OP recalled and cancelled the Certificate of
Land Ownership
_______________

1 Dated November 11, 2011;Rollo, pp. 35-49.


2 Id., at pp. 51-55.
3 Id., at pp. 68-69.

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Awards (CLOAs) issued to the petitioners covering certain homestead lots that formed part of
the Pacquing Estate, a 23.6272-hectare property located in Cuambogan, Tagum City.

Factual Antecedents

Miguel Pacquing acquired agricultural lands (the property) with a total area of 23.6272
hectares in Cuambogan, Tagum City through Homestead Patent No. V-33775. These lands were
registered on January 6, 1955 with the Register of Deeds under Original Certificate of Title No.
(P-2590) P-653.
The records show that, on August 5, 1991, the Municipal Agrarian Reform Officer (MARO)
sent Miguel’s representative a Notice of Coverage placing the Pacquing Estate under the
Comprehensive Agrarian Reform Program (CARP). Miguel failed to reply to the notice and,
instead filed a Voluntary Offer to Sell (VOS) with the Department of Agrarian Reform (DAR) on
August 31, 1991. Miguel, however, died during the pendency of the VOS proceedings. Miguel’s
wife, Salome, had died five years earlier.
In January 1992, respondent Linda Pacquing-Fadrilan, sole heir of the spouses Pacquing,
executed an affidavit adjudicating to herself ownership of the property. In August of the same
year, she filed an application for retention with the DAR Regional Director who denied Linda’s
application in an order dated December 14, 1993. The order denying Linda’s application for
retention later became final and executory.
On June 25, 1994, certain individuals, including the present petitioners who were earlier
identified as farmer-beneficiaries of the subject land, were issued CLOAs over their respective
cultivated portions of the property.
On October 20, 1999, Linda, through her attorney-in-fact, Samuel Osias, filed with the Office
of the Provincial Adjudicator in Tagum City a petition to cancel the petitioners’ CLOAs. The
Provincial Adjudicator later dismissed the petition due to Linda’s failure to file her position
paper. She appealed the217
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dismissal with the Department of Agrarian Reform Adjudication Board (DARAB).
It appears that, in the meantime, Transfer Certificates of Title (TCTs) covering portions of the
property were issued to Napoleon Villa, Sr., et al.,who had been contracted by Linda, under an
agricultural leasehold agreement, to cultivate the lands.
In a resolution dated June 29, 2001, the DARAB nullified the TCTs issued to Napoleon Villa,
Sr., et al. and reinstated Linda’s title to the property. At the same time, the DARAB ordered
the generation and issuance of titles to the petitioners and other farmer-beneficiaries of the
subject land. In a subsequent resolution dated September 28, 2001, the DARAB validated the
TCTs issued to the following individuals: Danilo Almero, Celia Bulaso, Ludy Ramada, Isidro
Lazarte, Cepriano Lazarte, Thelma Emorque, Domingo Juanico, Candido Labeste and Renato
Benimate.

Root of the present petition: Petition to Recall and Cancel the petitioners’ CLOAs

Linda again sought to recall and cancel the petitioners’ CLOAs by filing a petition with the
DAR, which the latter endorsed to the DAR Regional Office. Linda argued that the DARAB
erred in distributing portions of the land to the petitioners because the entire property was
supposed to be exempt from CARP coverage. The petitioners opposed Linda’s petition.
In an order dated December 18, 2008, the DAR Regional Director ruled that the Pacquing
Estate was subject to CARP and that the CLOAs issued to the petitioners were valid. Linda filed
an appeal to the DAR Secretary.
In an order dated August 18, 2009, former DAR Secretary Nasser C. Pangandaman denied
Linda’s appeal under the following terms:
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“x x x, under Section 6 of R.A. No. 6657, there are two requisites to exempt homestead lands from
CARP coverage. First, the homestead grantee or his direct compulsory heir(s) still own the original
homestead at the time of the effectivity of R.A. No. 6657 on 15 June 1988; andsecond, the original
homestead grantee or his direct compulsory heir(s) was cultivating the homestead as of 15 June 1988 and
continues to cultivate the same.
In this case, it is undisputed that the subject landholdings were still owned by the original
homestead grantees at the time of the effectivity of R.A. No. 6657. However, the said homestead
grantees no longer cultivate the same. Therefore, on this score, the subject landholdings cannot be
exempted from CARP coverage.” (Emphasis ours)

Linda appealed the DAR Secretary’s August 18, 2009 order to the OP.
In a decision dated February 16, 2011, the OP, through Executive Secretary Paquito N.
Ochoa, Jr., reversed the DAR Secretary’s August 18, 2009 Order and recalled and cancelled the
petitioners’ CLOAs. The OP held that:
“x x x, the fact that petitioners-appellants (referring to the respondent Linda), since the beginning,
have always protested the issuance of the CLOAs to the respondents-appellees (referring to the
petitioners) is a clear demonstration of their willingness to continue with the cultivation of the subject
landholdings, or to start anew with the cultivation or even to direct the management of the farm.
Given the foregoing, petitioners-appellants should be given the chance to exercise their rights as heirs
of the homestead grantee to continue to cultivate the homestead lots either personally or directly
managing the farm pursuant to the pronouncement in the Paris case. They still own the original
homestead issued to their predecessor-in-interest and have manifested their in-

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tention to continue with the cultivation of the homestead lots.”4 (Emphasis supplied)

The petitioners moved to reconsider the decision, but the OP denied their motion in a
resolution5 dated July 19, 2011.
With no appeal or petition for review filed with theCourt of Appeals within the fifteen (15)-
day appeal period, the DAR Bureau of Agrarian Legal Assistance issued on August 22, 2011
a Certificate of Finality6declaring as final and executory the OP’s February 16, 2011
decision and July 19, 2011 resolution. The petitioners, however, contest the finality of the OP’s
decision and allege that their counsel only received acertified copy of the OP’s resolution
denying their motion for reconsideration on September 29, 2011.
On November 14, 2011, the petitioners directly filed with this Court a petition for review
on certiorari under Rule 45 assailing the subject OP’s decision and resolution.

The Petition

The petitioners raise the following issues:


I. WHO WILL ISSUE A CERTIFICATE OF FINALITY OF THE DECISION WHEN THE
DECISION OF THE ADMINISTRATIVE AGENCY IS REVERSE (sic) ON APPEAL BY THE
OFFICE OF THE PRESIDENT?
II. ARE LANDS UNDER THE HOMESTEAD GRANT, EXEMPT FROM AGRARIAN
REFORM COVERAGE UNDER SECTION 6 OF R.A. 6657, EVEN IF THE HEIR OF THE
PATENTEE IS NOT CULTIVATING THE LAND, BUT AND HAD EVEN

_______________

4 Id., at p. 11.
5 Supra note 3.
6 Rollo, pp. 73-74.

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OFFERED THE SAME UNDER THE VOLUNTARY OFFER TO SELL SCHEME?
III. IN CARP COVERAGE, IS DEPOSIT OF LANDOWNER’S COMPENSATION WITH LAND
BANK OF THE PHILIPPINES ENOUGH TO TRANSFER TITLE TO THE STATE, EVEN IF THE
OWNER DOES NOT ACCEPT THE SAME?7(Emphasis supplied)

Pleadings Subsequent to the Petition

In her comment dated March 16, 2012,8 Linda counter-argues that the present petition should
be denied outright for being an improper mode of appeal: the appeal from the OP’s assailed
decision and resolution should have been filed with the CA via a petition for review under Rule
43 and not directly with this Courtvia a petition for review oncertiorari under Rule 45.
The petitioners filed their counter-comment/reply9asking this Court to decide the present case
not on technicalities but based on its merits, and that the Court, instead, treat their petition as a
special civil action for certiorari under Rule 65.

Our Ruling

We see MERIT in the present petition.


First, we address the procedural issue raised by the respondent.
Under Rule 43 of the Rules of Court, an appeal from the awards, judgments, final orders or
resolutions of or authorized by any quasi-judicial agency such as the Office of the President, in
the exercise of its quasi-judicial functions shall
_______________

7 Id., at p. 41.
8 Id., at pp. 188-192.
9 Dated June 10, 2013; Rollo,pp. 211-213.

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be filed to the CA10 within a period of fifteen (15) days from notice of, publication or denial of
a motion for new trial or reconsideration.11The appeal may involve questions of fact, of law, or
mixed questions of fact and law.12
A direct resort to this Court, however, may be allowed in cases where only questions of
law are raised.13 A question of law exists when the doubt or controversy concerns the correct
application of law or jurisprudence to a certain set of facts; or when the issue does not call for an
examination of the probative value of the evidence presented, the truth or falsehood of facts
being admitted.14
In the present petition, the petitioners raised valid questions of law that warranted the direct
recourse to this Court. Basically, they question the OP’s application of the law and jurisprudence
on the issue of whether the Pacquing Estate should be exempt from CARP coverage. In this case,
no further examination of the truth or falsity of the facts is required. Our review of the case is
limited to the determination of whether the OP has correctly applied the law and jurisprudence
based on the facts on record.
We now proceed to the merits of the case.
R.A. No. 6657 or the Comprehensive Agrarian Reform Law (CARL) of 1988 covers all public
and private agricultural lands as provided in Proclamation No. 13115 and E.O. No. 229,16including
other lands of the public domain suitable for
_______________

10 Section 1, Rule 43 of the Rules of Court.


11 Section 4, Rule 43 of the Rules of Court.
12 Section 3, Rule 43 of the Rules of Court.
13 Section 2(c), Rule 41 of the Rules of Court.
14 Bukidnon Doctors’ Hospital, Inc. v. Metropolitan Bank & TrustCo., G.R. No. 161882, July 8, 2005, 463 SCRA
222, 233.
15 Instituting a Comprehensive Agrarian Reform Program; approved July 22, 1987.
16 Providing the Mechanism for the Implementation of the Comprehensive Agrarian Reform Program; approved July
22, 1987.

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agriculture. Section 4 of R.A. 6657, as amended,17specifically lists the lands covered by the
CARP, which include:
(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 to 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.

And Section 10 of R.A. 6657, as amended,18expressly provides for the lands exempted or
excluded from the CARP, namely:
(a) Lands actually, directly and exclusively used for parks, wildlife, forest reserves, reforestation, fish
sanctuaries and breeding grounds, watersheds and mangroves shall be exempt from the coverage of this
Act;
(b) Private lands actually, directly and exclusively used for prawn farms 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 (CLOA) issued under the Agrarian Reform Program; and
xxxx

_______________

17 As amended by R.A. No. 9700.


18 As amended by R.A. No. 7881.

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(c) Lands actually, directly and exclusively used and found to be necessary for national defense,
school sites and campuses, including experimental farms stations operated by public or private schools for
educational purposes, seeds and seedlings research and pilot production centers, church sites and
covenants appurtenant thereto, mosque sites and Islamic centers appurtenant thereto, communal burial
grounds and cemeteries, penal colonies and penal farms actually worked by the inmates, government and
private research and quarantine centers and all lands with eighteen percent (18%) slope and over, except
those already developed, shall be exempt from the coverage of this Act.

The subject land, being agricultural in nature, is clearly not exempt from CARP
coverage.
But Linda argues that the subject land is exempt from CARP primarily because it was
acquired by her fathervia a homestead patent. She claims that the rights of homestead grantees
have been held superior to those of agrarian reform tenants and, thus, her right to the subject land
must be upheld. The OP, agreeing with the respondent, stated that:
“There can be no question that, weighed against each other, the rights of a homesteader prevail over
the rights of the tenants guaranteed by agrarian reform laws.
As early as the case ofPatricio v. Bayog, it has been held that the more paramount and superior policy
consideration is to uphold the right of the homesteader and his heirs to own and cultivate personally the
land acquired from the State without being encumbered by tenancy relations.
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Just right after the promulgation of Republic Act No. 6657, otherwise known as the Comprehensive
Agrarian Reform Law (CARL), the doctrine enunciated in Patricio was applied in Alita v. Court of
Appeals where it was held that Presidential Decree No. 27 cannot be invoked to defeat the very purpose
of the enactment of the Public Land Act or Commonwealth Act No. 141. It was further pointed out that
even the Philippine Constitution respects the superiority of the homesteaders’ rights over the rights of the
tenants guaranteed by the Agrarian Reform statute.”19 (Citations omitted)

The right of homestead grantees to retain or keep their homestead is, however, not absolutely
guaranteed by law. Section 6 of R.A 6657 provides that:
Section 6. Retention Limits.—Except as 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-size 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 or directly managing the farm: provided, that landowners
whose lands have been covered by Presidential Decree No. 27 shall be allowed to keep the areas
originally retained by them thereunder:provided, further, that original homestead grantees or their
direct compulsory heirs who still own the original homestead at the time of the approval of this Act
shall retain the same areas as long as they continue to cultivate said homestead. (Emphasis ours)

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19 Rollo, p. 10.

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Thus, in order for the homestead grantees or their direct compulsory heirs to retain or keep
their homestead, the following conditions must first be satisfied: (a) they must still be the owners
of the original homestead at the time of the CARL’s effectivity, and (b) they must continue to
cultivate the homestead land.
In this case, Linda, as the direct compulsory heir of the original homestead grantee, is no
longer cultivating the subject homestead land. The OP misinterpreted our ruling in Paris v.
Alfeche20 when it held that Linda’s mere expression of her desire to continue or to start anew with
the cultivation of the land would suffice to exempt the subject homestead land from the CARL.
On the contrary, we specifically held in Paris v. Alfeche that:
“Indisputably, homestead grantees or their direct compulsory heirs can own and retain the original
homestead, only for ‘as long as they continue to cultivate’ them. That parcels of land are covered by
homestead patents will not automatically exempt them from the operation of land reform. It is the fact
ofcontinued cultivation by the original grantees or their direct compulsory heirs that shall exempt
their lands from land reform coverage.”21(Emphasis supplied)

WHEREFORE, in view of the foregoing, we hereby:


(a) REVERSE and SET ASIDE the February 16, 2011 Decision and July 19, 2011
Resolution of the Office of the President in OP Case No. 10-C-152;
(b) RECALL andREVOKE the August 22, 2011 Certificate of Finality issued by the
Department of Agrarian Reform Bureau of Agrarian Legal Assistance; and
_______________

20 G.R. No. 139083, August 30, 2001, 364 SCRA 110.


21 Id., at p. 118.

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(c) AFFIRM the August 18, 2009 Order of the Department of Agrarian Reform Secretary in
DARCO Order No. MS-0908-295, Series of 2009, A-999-10-CLT-028-09.
SO ORDERED.
Carpio (Chairperson), Del Castillo and Mendoza, JJ., concur.
Leonen, J., See Dissenting Opinion.

DISSENTING OPINION

LEONEN, J.:

I dissent on two points.First, the Office of the President’s February 16, 2011 Decision1 is
already final and executory. This court, therefore, may no longer review the Decision.
Second, the property in this case is covered by a homestead patent. Thus, it is exempt from
agrarian reform coverage. The heirs of the original homesteader must be given the chance to
cultivate their land.

I
This court may no longer review the final and executory Decision of the Office of the
President

Under Rule 43 of the Rules of Court, decisions of the Office of the President are appealed
before the Court of Appeals through a Petition for Review raising questions of fact, of law, or
mixed questions of fact and law.2 The Appeal must be filed within 15 days from notice of the
decision or resolution denying the Motion for Reconsideration as provided in Rule 43, Sections 1
and 4:
_______________

1 Rollo, pp. 8-12.


2 Rules of Court, Rule 43, Sec. 3.

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Section 1. Scope.—This Rule shall apply to appeals from judgments or final orders of the Court of
Tax Appeals and from awards, judgments, final orders or resolutions of or authorized by any quasijudicial
agency in the exercise of its quasi-judicial functions. Among these agencies are the Civil Service
Commission, Central Board of Assessment Appeals, Securities and Exchange Commission, Office of the
President, Land Registration Authority, Social Security Commission, Civil Aeronautics Board, Bureau of
Patents, Trademarks and Technology Transfer, National Electrification Administration, Energy
Regulatory Board, National Telecommunications Commission, Department of Agrarian Reform under
Republic Act No. 6657, Government Service Insurance System, Employees’ Compensation Commission,
Agricultural Inventions Board, Insurance Commission, Philippine Atomic Energy Commission, Board of
Investments, Construction Industry Arbitration Commission, and voluntary arbitrators authorized by law.
Sec. 4. Period of appeal.—The appeal shall be taken within fifteen (15) days from notice of the
award, judgment, final order or resolution, or from the date of its last publication, if publication is
required by law for its effectivity, or of the denial of petitioner’s motion for new trial or reconsideration
duly filed in accordance with the governing law of the court or agency a quo. Only one (1) motion for
reconsideration shall be allowed. Upon proper motion and the payment of the full amount of the docket
fee before the expiration of the reglementary period, the Court of Appeals may grant an additional period
of fifteen (15) days only within which to file the petition for review. No further extension shall be granted
except for the most compelling reason and in no case to exceed fifteen days.

Petitioners Danilo Almero, Teresita Alagon, Celia Bulaso, Ludy Ramada, Regina Gegremosa,
Isidro Lazarte, Thelma Embarque, Felipe Lazarte, Guilerma Lazarte, and Dulcesima Benimele
(Almero, et al.) availed themselves of the wrong remedy against the Office of the President’s
Decision. Instead
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of directly appealing before this court, Almero, et al. should have filed a Petition for Review
before the Court of Appeals under Rule 43.
It is true that a Petition for Review on Certiorari may be directly filed before this court if the
Petition raises pure questions of law.3However, even assuming that Almero, et al.’s Petition
raises pure questions of law, this court should have dismissed outright Almero, et al.’s Petition
for having been filed out of time. Under Rule 45, Section 2 of the Rules of Court, a Petition for
Review on Certiorari must be filed within 15 days from notice of the assailed Decision or
Resolution:
Sec. 2. Time for filing; extension.—The petition shall be filed within fifteen (15) days from notice
of the judgment or final order or resolution appealed from, or of the denial of the petitioner’s motion for
new trial or reconsideration filed in due time after notice of the judgment. On motion duly filed and
served, with full payment of the docket and other lawful fees and the deposit for costs before the
expiration of the reglementary period, the Supreme Court may for justifiable reasons grant an extension of
thirty (30) days only within which to file the petition.

Almero, et al., had notice of the Office of the President’s Resolution denying their Motion for
Reconsideration on September 29, 2011. Thus, Almero, et al., had until October 14, 2011 to file
their Appeal. Yet, Almero, et al., appealed before this court only on November 14, 2011, which
was beyond 15 days from their notice of the Resolution denying their Motion for
Reconsideration. Their filing of the Petition, therefore, did not toll the reglementary period for
filing an appeal. The Decision of the Office of the President has become final and executory as
of October 15, 2011, and this court may no longer review the Decision.
_______________

3 Rules of Court, Rule 41, Sec. 2(c).

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II
The property is exempt from coverage of the
Comprehensive Agrarian Reform Program

Agrarian reform is the “redistribution of lands, regardless of crops or fruits produced, to


farmers and regular farmworkers who are landless.”4 It includes not only the physical
redistribution of lands but also other alternative arrangements, such as production or profit-
sharing, labor administration, and the redistribution of shares of stock all aimed to lift the
economic status of the property’s farmer-beneficiaries.5
As a general rule, all agricultural lands, whether public or private, are covered by the
Comprehensive Agrarian Reform Program.6An agricultural land refers to land devoted to any of
the following agricultural activities: 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.7 Section 4 of the Comprehensive
Agrarian Reform Law enumerates properties covered by the Comprehensive Agrarian Reform
Program:
SEC. 4. Scope.—The Comprehensive Agrarian Reform Law of 1988 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:

_______________

4 Rep. Act No. 6657, Sec. 3(a).


5 Id.
6 Rep. Act No. 6657, Sec. 4.
7 Rep. Act No. 6657, Sec. 3(b).

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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.

As for the properties exempt from agrarian reform coverage, Section 10 of the
Comprehensive Agrarian Reform Law provides:
SEC. 10. Exemptions and Exclusions.—Lands actually, directly and exclusively used and found to
be necessary for parks, wildlife, forest reserves, reforestation, fish sanctuaries and breeding grounds,
watersheds and mangroves, national defense, school sites and campuses including experimental farm
stations operated by public or private schools for educational purposes, seeds and seedlings research and
pilot production centers, church sites and convents appurtenant thereto, mosque sites and Islamic centers
appurtenant thereto, communal burial grounds and cemeteries, penal colonies and penal farms actually
worked by the inmates, government and private research and quarantine centers and all lands with
eighteen percent (18%) slope and over, except those already developed shall be exempt from the coverage
of this Act.

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In the present case, the majority ruled that the property of the Heirs of Manuel Pacquing is
covered by the Comprehensive Agrarian Reform Program, the property being an agricultural
land.
I disagree with the majority. The property in this case is exempt from agrarian reform, having
been granted to Manuel Pacquing through a homestead patent.
Although a social justice measure,8 agrarian reform is subject to limitations. Under Article
XIII, Section 6 of the Constitution, distribution of lands through agrarian reform is “subject to
prior rights, homestead rights of small settlers, and the rights of indigenous cultural communities
to their ancestral lands”:
Section 6. The State shall apply the principles of agrarian reform or stewardship, whenever
applicable in accordance with law, in the disposition or utilization of other natural resources, including
lands of the public domain under lease or concession suitable to agriculture, subject to prior rights,
homestead rights of small settlers, and the rights of indigenous cultural communities to their ancestral
lands. (Emphasis supplied)

Chapter IV of Commonwealth Act No. 141 or the Public Land Act governs the grant of
homestead patents. Under Section 12 of the law, an applicant “may enter a homestead of not
exceeding twenty-four hectares of agricultural land of the public domain.” A homestead patent or
title to the homestead is issued only if the applicant has improved and cultivated at least one-fifth
of the agricultural land applied for. Section 14 of the Public Land Act provides:
_______________

8 Association of Small Landowners in the Phils., Inc. v. Secretary of Agrarian Reform, 256 Phil. 777; 175 SCRA 343
(1989) [PerJ. Cruz, En Banc].

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Sec. 14. No certificate shall be given or patent issued for the land applied for until at least one-fifth
of the land has been improved and cultivated. The period within which the land shall be cultivated shall
not be less than one nor more than five years from and after the date of the approval of the application.
The applicant shall, within the said period, notify the Director of Lands as soon as he is ready to acquire
the title. If at the date of such notice, the applicant shall prove to the satisfaction of the Director of Lands,
that he has resided continuously for at least one year in the municipality in which the land is located, or in
a municipality adjacent to the same, and has cultivated at least one-fifth of the land continuously since the
approval of the application, and shall make affidavit that no part of said land has been alienated or
encumbered, and that he has complied with all the requirements of this Act, then upon the payment of five
pesos, as final fee, he shall be entitled to a patent.

The state grants homestead rights “to encourage residence upon and the cultivation and
improvement of [agricultural lands] of the public domain.”9In Jocson v. Soriano,10 this court
further explained the purpose of granting and protecting homesteads:
[The object of homestead laws] is to provide a home for each citizen of the Government, where his
family may shelter and live beyond the reach of financial misfortune, and to inculcate in individuals those
feelings of independence which are essential to the maintenance of free institutions. Furthermore, the state
itself is concerned that the citizens shall not be divested of a means of support, and reduced to pauperism.
The conservation of a family home is the purpose of homestead laws. The policy of the state is to
foster fami-

_______________

9 Patricio v. Bayog, 197 Phil. 728, 733; 112 SCRA 41, 46 (1982) [Per J. Aquino, Second Division], citing Aquino v.
Director of Lands, 39 Phil. 850, 861 (1919) [Per J.Malcolm, En Banc].
10 45 Phil. 375 (1923) [Per J.Johnson, En Banc].

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lies as the factors of society, and thus promote general welfare. The sentiment of patriotism and
independence, the spirit of free citizenship, the feeling of interest in public affairs, are cultivated and
fostered more readily when the citizen lives permanently in his own home, with a sense of its protection
and durability.11(Citations omitted)

In 1982, this court had the opportunity to resolve the issue of who has the better right to a
homestead — the homesteader or the tenant tilling the land. In Patricio v. Bayog,12 this court said
that “the more paramount and superior policy consideration is to uphold the right of the
homesteader and his heirs to own and cultivate personally the land acquired from the State
without being encumbered by tenancy relations.”13
In Alita v. Court of Appeals,14 this court categorically ruled that lands obtained through
homestead patents are not covered by the agrarian reform program, the rights of homesteaders
being “superior”15 to the rights of tenants. This court said that the provisions of Presidential
Decree No. 72, Series of 1972, then governing agrarian reform, “cannot be invoked to defeat the
very purpose of the enactment of the Public Land Act or Commonwealth Act No.
141.”16 CitingPatricio:
The Homestead Act has been enacted for the welfare and protection of the poor. The law gives a
needy citizen a piece of land where he may build a modest house for himself and family and plant what is
necessary for subsistence and for the satisfaction of life’s other

_______________

11 Id., at p. 379.
12 Patricio v. Bayog, supra note 9.
13 Id., at pp. 732-733; p. 45.
14 252 Phil. 733; 170 SCRA 706 (1989) [Per J. Paras, Second Division].
15 Id., at p. 735; p. 709.
16 Id.

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needs. The right of the citizens to their homes and to the things necessary for their subsistence is as vital
as the right to life itself. They have a right to live with a certain degree of comfort as become human
beings, and the State which looks after the welfare of the people’s happiness is under a duty to safeguard
the satisfaction of this vital right.17

In ruling for the homesteader in Alita, this court relied on Article XIII, Section 6 of the
Constitution. This court went on to state that even the Comprehensive Agrarian Reform Law of
1988 recognizes the “inapplicability of [agrarian reform laws] to lands covered by homestead
patents.”18This court referred to theproviso in Section 6 of the Comprehensive Agrarian Reform
Law:
Section 6. Retention Limits.—Except as 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-size 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 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 their
direct compulsory heirs who still own the original homestead at the time of the approval of this Act shall
retain the same areas as long as they continue to cultivate said homestead. (Emphasis supplied)

_______________

17 Id.
18 Id., at p. 736; p. 710.

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However, contrary to theAlita ruling, this court used Section 6 as legal basis to rule that
homesteads are covered by the agrarian reform program. In the 2001 case of Paris v.
Alfeche,19 the state granted Florencia Paris a homestead patent over a parcel of land in Paitan,
Quezon, Bukidnon. Emancipation patents were subsequently issued to the tenants tilling her
property, depriving Paris and her children of their right to personally cultivate their property.
To recover her property, Paris filed an application to retain at least five (5) hectares of her
property in Bukidnon. Since her property was covered by a homestead patent, Paris argued,
among others, that she and her children have the better right to cultivate their land as this court
ruled in Patricio and Alita.
The Department of Agrarian Reform Adjudicator ruled in favor of Paris and cancelled the
emancipation patents issued to the tenants. On appeal, however, the Department of Agrarian
Reform Adjudication Board reversed the Adjudicator and declared the tenants as “full owners of
the land they till.”20 The Court of Appeals agreed with the Department of Agrarian Reform
Adjudication Board and affirmed its Decision.
This court affirmed the Court of Appeals’ Decision, ruling that “parcels of land . . . covered
by homestead patents [are] not automatically exempt . . . from the operation of land reform.”
Section 6 of the Comprehensive Agrarian Reform Law allows homesteaders to retain their land
“as long as they continue to cultivate [their] homestead.”21 Therefore, “it is the fact of continued
cultivation by the original grantees or their direct compulsory heirs that shall exempt their lands
from land reform coverage.”22
_______________

19 416 Phil. 473; 364 SCRA 110 (2001) [Per J. Panganiban, Third Division].
20 Id., at p. 478; p. 114.
21 Id., at p. 484; p. 118.
22 Id.
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Finding that Paris and her children were not personally cultivating their homestead, this court
denied Paris’ application for retention.
On Paris’ contention that she and her children, as homesteaders, had the better right to
cultivate their land, this court held that Patricioand Alita did not apply toParis’ case. The
homesteaders in Patricio andAlita showed their intention to continue cultivating their
homesteads.23 Thus, this court allowed the homesteaders to retain their properties
in Patricio andAlita.
Unlike the homesteaders in Patricio and Alita, this court found that Paris and her children
never personally cultivated their homestead, and they never expressed their intention to do so.
For these reasons, this court denied Paris’ application for retention and surmised that Paris and
her children would “undoubtedly continue to be absentee landlords”:24
[T]he rulings in both Patricioand Alita, which are in line with the state objective of fostering owner
cultivatorship and of abolishing tenancy, would be inapplicable to the present case. Since petitioner and
her heirs have evinced no intention of actually cultivating the lands or even directly managing the farm,
they will undoubtedly continue to be absentee landlords. Therefore, to blindly and indiscriminately apply
the ruling in the cited cases would be tantamount to encouraging feudalistic practices and going against
the very essence of agrarian reform. This we cannot sanction.25 (Citation omitted)

Despite this court’s ruling in Paris, I maintain that the property should be exempt from
agrarian reform. As this court held in Patricio andAlita, the right of tenants to own the land they
till through agrarian reform is subject to the
_______________

23 Id., at p. 485; p. 118.


24 Id., at p. 486; p. 120.
25 Id., at pp. 486-487; pp. 119-120.

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right of homesteaders to personally cultivate their property. This right of homesteaders is
guaranteed by no less than the Constitution.
In providing that homesteaders may retain their land “as long as they continue to cultivate
said homestead,” Section 6 of the Comprehensive Agrarian Reform Law is unconstitutional. The
Constitution does not require homesteaders to show their intention to cultivate their land before
their properties are exempted from agrarian reform coverage. Under the law, homestead patents
are granted only if the applicants have proven to the satisfaction of the Director of Lands that
they have entered, improved, and cultivated the land applied for.26 It must therefore be presumed
that grantees of homestead patents cultivate their land.
In any case, the Heirs of Manuel Pacquing must be allowed to retain their homestead, similar
to the homesteaders in Patricio andAlita. As this court declared in Paris, homesteaders are
allowed to retain their property if they show their intention to continue cultivating their
property.27As the Office of the President found, the Heirs of Manuel Pacquing have shown their
intention to continue cultivating their property by protesting the issuance of certificates of land
ownership award to Almero, et al. The Heirs of Manuel Pacquing “should be given the chance to
exercise their rights as heirs of the homestead grantee to continue to cultivate the homestead lots
either personally or directly managing the farm pursuant to the pronouncement in
theParis case.”28

III
This case must be elevated to the court En Banc
_______________

26 Public Land Act, Sec. 14.


27 Supra note 19 at p. 485; p. 118.
28 Rollo, p. 11. Office of the President’s Decision dated February 16, 2011.

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In the alternative, this case must be elevated to the court En Banc considering that the
constitutionality of Section 6 of the Comprehensive Agrarian Reform Law is at issue in this case.
Rule 2, Section 3(a) of the Internal Rules of the Supreme Court provides:
Section 3. Court En Banc matters and cases.—The CourtEn Banc shall act on the following matters
and cases:
(a) cases in which the constitutionality or validity of any treaty, international or executive
agreement, law, executive order, presidential decree, proclamation, order, instruction, ordinance, or
regulation is in question[.]

IN VIEW OF THE FOREGOING, I vote toDENY the Petition for Review on Certiorari.
The Office of the President’s Decision dated February 16, 2011 must be AFFIRMED.
Judgment and resolution reversed and set aside; Certificate of Finality recalled and revoked;
Order of Department of Agrarian Reform dated August 18, 2009 affirmed.
Notes.—A petition for review under Rule 43 is the prescribed mode for appeal from a
decision rendered by the Office of the President. (Republic vs. Heirs of Cecilio and Moises
Cuizon, 692 SCRA 626 [2013])
Under RA 6657, the Comprehensive Agrarian Reform Program (CARP) shall cover all public
and private agricultural lands, including other lands of the public domain suitable for agriculture,
regardless of tenurial arrangement and commodity produced; Lands devoted to livestock,
poultry, and swine raising are classified as industrial, not agricultural lands and, thus, exempt
from agrarian reform. (Department of Agrarian Reform vs. Court of Appeals, 706 SCRA 213
[2013])

G.R. No. 169472. January 20, 2009.*


FRANCISCO LANDICHO, FEDERICO LANDICHO AND BUENAVENTURA LANDICHO,
petitioners, vs.FELIX SIA, respondent.
Appeals; While as a general rule, questions of fact are not proper in a petition under Rule 45, where
the findings of facts of the DARAB and the Court of Appeals contradict each other, it is crucial to go
through the evidence and documents on record as a matter of exception to the rule.—The case before us
involves the determination of whether the petitioners are tenants of the land purchased by the respondent,
which is essentially a question of fact. As a general rule, questions of fact are not proper in a petition
under Rule 45. But, since the findings of facts of the DARAB and the Court of Appeals contradict each
other, it is crucial to go through the evidence and documents on record as a matter of exception to the
rule.
Agrarian Reform Law; Tenancy; Words and Phrases; A tenant is defined under Section 5(a) of
Republic Act No. 1199, otherwise known as the Agricultural Tenancy Act of the Philippines, as “x x x a
person who, himself and with the aid available from within his immediate farm household, cultivates the
land belonging to, or possessed by, another, with the latter’s consent for purposes of production, sharing
the produce with the landholder under the share tenancy system, or paying to the landholder a price
certain or ascertainable in produce or in money or both, under the leasehold tenancy system.”—A tenant
is defined under Section 5(a) of Republic Act No. 1199, otherwise known as the Agricultural Tenancy
Act of the Philippines, as: x x x a person who, himself and with the aid available from within his
immediate farm household, cultivates the land belonging to, or possessed by, another, with the latter’s
consent for purposes of production, sharing the produce with the landholder under the share tenancy
system, or paying to the landholder a price certain or ascertainable in produce or in money or both, under
the leasehold tenancy system.
Same; Same; Requisites.—A tenancy relationship arises between a landholder and a tenant once
they agree, expressly or impliedly, to undertake jointly the cultivation of a land belonging to the
landholder, as a result of which relationship the tenant acquires the right to continue working on and
cultivating the land. The existence of a tenancy relationship cannot be presumed and claims that one is a
tenant do not automatically give rise to secu-

_______________

* FIRST DIVISION.
603rity of tenure. For a tenancy relationship to exist, all of the following essential requisites must be
present: (1) the parties are the landowner and the tenant; (2) the subject matter is agricultural land; (3)
there is consent between the parties; (4) the purpose is agricultural production; (5) there is personal
cultivation by the tenant; and, (6) there is sharing of the harvests between the parties.
Same; Same; Evidence; The alleged tenants cannot rely on their self-serving statements to prove the
existence of a tenancy relationship because independent and concrete evidence, aside from self-serving
statements, is needed to prove personal cultivation, sharing of harvests, or consent of the landowner—a
tiller or a farmworker does not automatically become an agricultural tenant recognized under agrarian
laws by mere occupation or cultivation of an agricultural land.—The essential element of consent is
absent because the landowners never recognized petitioners Federico and Buenaventura Landicho as
legitimate tenants of the subject land. And, although Federico and Buenaventura claim that they are
tenants of “Lot No. 9896 and Lot No. 9897,” respectively, simply because they continuously cultivated
and openly occupied the subject land; there was no evidence presented to establish the presence of the
essential requisites of a tenancy relationship other than the self-serving statements of the petitioners.
Furthermore, both the 1976 and the 1987Kasulatan only mentioned Francisco as the tenant of the subject
parcels of land, and there was no mention of petitioners Federico and Buenaventura. The petitioners
cannot rely on their self-serving statements to prove the existence of a tenancy relationship because
independent and concrete evidence, aside from self-serving statements, is needed to prove personal
cultivation, sharing of harvests, or consent of the landowner. A tiller or a farmworker does not
automatically become an agricultural tenant recognized under agrarian laws by mere occupation or
cultivation of an agricultural land.
Same; Same; Same; Independent evidence, such as receipts, must be presented to show that there
was a sharing of the harvest between the landowner and the tenant; The fact of receipt, without an agreed
system of sharing, does not ipso facto create a tenancy.—There was also no evidence presented to show
that Federico and Buenaventura gave a share of their harvest to the Aragons. Independent evidence, such
as receipts, must be presented to show that there was a sharing of the harvest between the landowner and
the tenant. And, assuming the landowners received a share of the harvest, it was held in the case
of Cornelio de Jesus, et al. v. Moldex Realty, Inc., 538 SCRA 316 (2007), that “[t]he fact of receipt,
without an agreed system of sharing, does not ipso facto create a tenancy.”604
Same; Same; Same; Acquiescence by the landowner of alleged tenants’ cultivation of the land does
not create an implied tenancy if the landowners have never considered the latter as tenants of the land
and if the essential requisites of a tenancy relationship are lacking.—Neither can we give any weight to
the petitioners’ contention that there was an implied tenancy by reason alone of their continuous
cultivation of the land. Acquiescence by the landowner of their cultivation of the land does not create an
implied tenancy if the landowners have never considered petitioners Federico and Buenaventura as
tenants of the land and if the essential requisites of a tenancy relationship are lacking. There was no
intention to institute the petitioners as agricultural tenants. In the case of Epitacio Sialana v. Mary Y.
Avila, et al., 495 SCRA 501 (2006), it was held that “x x x for an implied tenancy to come about, the
actuations of the parties taken in their entirety must be demonstrative of an intent to continue a prior lease
established by the landholder
x x x.”
Same; Same; Contracts; A person is not incapacitated to contract merely because of advanced years
or by reason of physical infirmities—it is only when such age or infirmities impair the mental faculties to
such extent as to prevent one from properly, intelligently, and fairly protecting her property rights, is she
considered incapacitated.—The petitioners also failed to support their claim that the Aragons took
advantage of Francisco’s old age and illiteracy and employed fraudulent schemes in order to deceive him
into signing theKasulatan. It has been held that “[a] person is not incapacitated to contract merely because
of advanced years or by reason of physical infirmities. It is only when such age or infirmities impair the
mental faculties to such extent as to prevent one from properly, intelligently, and fairly protecting her
property rights, is she considered incapacitated.”
Same; Same; Same; Strong evidence is required to prove a defect of a public instrument.—It is also
important to note that both the 1976 and 1987Kasulatan are duly notarized and are considered as public
documents evidencing the surrender of Francisco’s tenancy rights over the subject landholdings. They
were executed with all the legal formalities of a public document and thus the legal presumption of the
regularity and validity of the Kasulatan are retained in the absence of full, clear and convincing evidence
to overcome such presumption. Strong evidence is required to prove a defect of a public instrument, and
since such strong and convincing evidence was not presented in the instant case, the 1976 and the
1987 Kasulatanare presumed valid.605
Same; Same; Prescription; An action to enforce rights as an agricultural tenant is barred by
prescription if not filed within three (3) years.—An action to enforce rights as an agricultural tenant is
barred by prescription if not filed within three (3) years. Section 38 of Republic Act No. 3844, otherwise
known as the Agricultural Land Reform Code, specifically provides that: SECTION 38. Statute of
Limitations.—An action to enforce any cause of action under this Code shall be barred if not commenced
within three years after such cause of action accrued.
PETITION for review on certiorari of the decision and resolution of the Court of Appeals.
The facts are stated in the opinion of the Court.
Rexie M. Maristela for petitioners.
Natalio T. Paril, Jr. for respondent.
PUNO, C.J.:
At bar is a Petition for Review on Certiorari of the Decision1 and Resolution2 of the Court of
Appeals in CA G.R. SP No. 61554, dated February 23, 2005 and July 6, 2005, respectively,
reversing the decision of the Department of Agrarian Reform (DAR), Adjudication Board
(DARAB), in DARAB Case No. 4599. The DARAB decision affirmed with modification the
Decision of the Provincial Adjudicator of Region IV, Quezon, in PARAD Case No. IV-QUI-
0343-94 dated October 24, 1995, awarding the petitioners disturbance compensation, a home lot
consisting of 200 square meters, and damages. The appellate court found that the complaint
against the respondent is dismissible for lack of cause of action on the ground of prescription.
The instant case involves three parcels of agricultural land located in Barangay Mateona,
Tayabas, Quezon, covered by Transfer Certificate of Title (TCT) No. 135953—Lot No.
9297,3 TCT No. 135952—Lot

_______________

1 Rollo, pp. 73-80.


2 Id., at pp. 81-83.
3 There appears to be a discrepancy in the Records of the Department of Agrarian Reform Adjudication Board, pp. 7-
8. According to the 1976 Kasulatan sa Pagsasauli ng Gawaing Palayan, TCT No. 135953 contains Lot No.
606No. 9856,4 and TCT No. 135929—Lot No. 9895,5 with an aggregate area of approximately
27,287 square meters. The subject parcels of land were originally owned by Loreanne Z. Aragon,
Alberto Z. Aragon, Jr., and Alberto Z. Aragon III (Aragons).6 The agricultural land was tenanted
by the late Arcadio Landicho from 1949 until his death in 19727 after which his tenancy rights
were succeeded by his son, petitioner Francisco Landicho.8 The other petitioners, Buenaventura
Landicho, Francisco Landicho’s son, and Federico Landicho, Francisco’s brother, helped him
cultivate the land.9
On January 31, 1976, Francisco Landicho voluntarily surrendered his tenancy rights over the
three parcels of land to Eloisa Zolota, married to Alberto Aragon, through a notarized
“Kasulatan sa Pagsasauli ng Gawaing Palayan” (1976Kasulatan),10 for a consideration of
PhP1,000.00. The 1976Kasulatan provides, viz.:
KASULATAN SA PAGSASAULI NG GAWAING PALAYAN
HAYAG SA SINUMANG MAKABABASA:
Ako, Francisco,[sic]Landicho, may sapat na gulang, may asawa, filipino, at sa ngayon ay naninirahan
sa nayon ng Mationa, bayan ng Tayabas, lalawigan ng Quezon, sa bisa ng Kasulatang ito’y

_______________

9297, but the 1987 Kasulatan ng Pagsasauli ng Gawain provides that TCT No. 135953 contains Lot No. 9897.

4 According to the 1976 Kasulatan sa Pagsasauli ng Gawaing Palayan, TCT No. 135952 contains Lot No. 9856, but the
1987 Kasulatan ng Pagsasauli ng Gawain provides that TCT No. 135953 contains Lot No. 9856.
5 According to the 1976 Kasulatan sa Pagsasauli ng Gawaing Palayan, TCT No. 135929 contains Lot No. 9895, but the
1987 Kasulatan ng Pagsasauli ng Gawain provides that TCT No. 135953 contains Lot No. 9895.
6 Rollo, p. 73; Records of the Department of Agrarian Reform Adjudication Board, p. 33.
7 Records of the Department of Agrarian Reform Adjudication Board, pp. 1 and 60.
8 Id., at p. 33.
9 Rollo, p. 8; Records of the Department of Agrarian Reform Adjudication Board, p. 34.
10 Records of the Department of Agrarian Reform Adjudication Board, p. 7.
607NAGSASAYSAY:
Na ako ang tunay at rehistradong mangagawa ng tatlong (3) parcelang palayanna may kasamang
niogan, na natatayo sa nayon ng Mationa, bayan ng Tayabas, lalawigan ng Quezon, na ang mga sukat, at
hangganan nito ay lalong makikilala at matutonton sa mga palatandaang sumusunod: (emphasis
supplied)
TRANSFER CERTIFICATE OF TITLE No. T-135953
“A parcel of land (Lot 9297 of the Cad. Survey of Tayabas), with the improvements thereon, situated
in the Barrio of Mationa, Municipality of Tayabas, Quezon. x x x containing an area of Four Thousand
Three Hundred Eighty Three (4,383) square meters more or less, x x x.”
TRANSFER CERTIFICATE OF TITLE No. T-135952
“A parcel of land (Lot 9856 of the Cad. Survey of Tayabas) with the improvements thereon, situated
in the Barrio of Mationa, Municipality of Tayabas. x x x containing an area of Nineteen Thousand Thirty
Two (19,032) square meters, more or less, x x x.”
TRANSFER CERTIFICATE OF TITLE No. T-135929
“A parcel of land (Lot 9895 of the Cadastral Survey of Tayabas), with the improvements thereon,
situated in the Barrio of Mationa, Municipality of Tayabas, x x x containing an area of Three Thousand
Eight Hundred Seventy Two (3,872) square meters, more or less, x x x.”
Na sapagkat ako ay mayroon pang ilang palayang ginagawa at alang-alang din sa halagang ISANG
LIBONG PISO (P1,000.00), salaping umiiral na ibinayad at tinanggap ko naman ng buong kasiyahan
buhat kay Eloisa Zolota, may sapat na gulang, Filipino [sic] kasal kay Alberto Aragon at sa ngayon ay
naninirahan din dito sa bayan ng Tayabas, lalawigan ng Quezon, ay aking kusang loob na ISASAULI
AT IBABALIK sa may-ari nito ang tatlong (3) parcelang palayan na binabanggit sa itaas nito x x x.
(emphasis supplied)
SA KATUNAYAN NG LAHAT, ay nilalagdaan ko ito ngayong ika-31 ng Enero, taong 1976, dito sa
bayan ng Tayabas, lalawigan ng Quezon.
DIGPI NG KANANG HINLALAKI
FRANCISCO LANDICHO
Manggagawa
xxxx
608Notwithstanding the execution of the 1976Kasulatan, the petitioners continued cultivating
the subject landholdings11 until 1987 when another notarized “Kasulatan ng Pagsasauli ng
Gawaing Palayan” (1987Kasulatan)12 was executed on July 2, 1987 by Francisco Landicho
through which he surrendered his tenancy rights to the Aragons for a consideration of
PhP3,000.00.13 The 1987Kasulatan provides, viz.:
KASULATAN NG PAGSASAULI NG GAWAIN
TANTUIN ANG SINUMANG MAKAKABASA NITO:
Ako, FRANCISCO LANDICHO, asawa ni Lucia Reyes, may sapat na gulang, filipino,[sic] at
naninirahan sa bayan ng Tayabas, lalawigan ng Quezon, dito ay nagsasalaysay ng mga sumusunod:
(emphasis supplied)
Na ako ang siyang gumagawa at nagaalaga ng tatlong palagay na lupa na mayroong pagkakaayos
gaya ng sumusunod: (emphasis supplied)
TRANSFER CERTIFICATE OF TITLE NO. T-135953
A parcel of land (Lot 9897 of the Cad. Survey of Tayabas), with the improvements thereon, situated
in the Barrio of Mationa, Municipality of Tayabas, Quezon. x x x containing an area of Four Thousand
Eight Hundred Three [sic] (4,383) square meters
A parcel of land (Lot 9856) of the Cadastral Survey of Tayabas), with the improvements thereon,
situated in the Barrio of Mationa, Municipality of Tayabas. x x x containing an area of Nineteen
Thousand Thirty Two (19,032) square meters, more or less
A parcel of land (Lot 9895 of the Cad. Survey of Tayabas), with the improvements thereon, situated
in the Barrio of Mationa, Municipality of Tayabas x x x containing an area of Three Thousand Eight
Hundred Seventy Two (3,872) square meters, more or less
Naitong [sic] naulit na lupa ay pagaari nila Loreanne Z. Aragon, Alberto Aragon, Jr., Alberto Aragon
III, gayondinsapagkat ako ay matanda
_______________

11 Id., at p. 2.
12 Id., at p. 8.
13 Id., at p. 34. The consideration of PhP3,000.00 was not stated in the 1987 Kasulatan but was admitted by Francisco
Landicho during a mediation conference held at the Provincial Agrarian Reform Office on July 22, 1992.
609na at gayondin hindi ko na kayang gumawa sa naulit na lupa, kaya itong naulit na lupaay aking
ISINASAULI at IBINABALIK sa naulit na mayaring nasasabi sa taas nito; (emphasis supplied)
Na simula ngayon ay mayroong karapatan na sila na kumuha o humanap ng ibang gagawa sa naulit
na lupa at hindi na akong makikiaalam dito, at gayondin mayroong laya silang ipagbili ang naulit na
lupa, at hindi ako makikialam dito; na ito aybinasa sa akin at naunawaan ko naman ang nilalaman
nito; (emphasis supplied)
SA KATUNAYAN ng lahat, [sic] ng ito ako’y lumagda sa kasulatang ito ngayong ika 2 ng
Hulyo,/[sic]1987 dito sa Tayabas, Quezon.
Diin ng Kgg. Hin’ki
FRANCISCO LANDICHO
Manggagawa
xxxx
On the same day as the execution of the 1987Kasulatan, the three parcels of land were sold to
respondent Felix L. Sia by the spouses Alberto P. Aragon and Eloisa Zolota Aragon by virtue of
a general power of attorney executed in their favor by their children, the Aragons. A “Deed of
Absolute Sale”14 was executed, whereby the three parcels of land mentioned above were sold,
transferred and conveyed by way of an absolute sale for and in consideration of PhP50,000.00.
Upon the sale of the subject land to respondent Felix Sia, he converted the same to a
residential subdivision without a DAR Clearance and ejected the petitioners from the subject
land.15 Aggrieved, the petitioners first sought the assistance of Barangay Agrarian Reform
Committee (BARC) Chairman Rosalio Cabuyao,16 who in turn brought the matter to the
Provincial Agrarian Reform Office (PARO) of Quezon.
Petitioners Federico Landicho and Buenaventura Landicho then filed a protest before the
DAR PARO, Legal Division of Lucena City17

_______________

14 Id.
15 Records of the Department of Agrarian Reform Adjudication Board, p. 2; Rollo, p. 8.
16 Records of the Department of Agrarian Reform Adjudication Board, p. 3.
17 Records of the Department of Agrarian Reform Adjudication Board, p. 33; Rollo, p. 8.
610alleging that they are the tenants of the parcels of land owned by respondent Felix Sia and
claimed that they are entitled to a disturbance compensation. During the mediation conference
held at the DAR Provincial Agrarian Reform Office on July 22, 1992, it was admitted by
Francisco Landicho that he voluntarily surrendered his tenancy rights over the subject parcels of
land in consideration of PhP3,000.00.18 Thus, in the Report and Recommendation19 of DAR
Provincial Legal Officer III, Ernesto M. Arro, Jr., dated October 1, 1992, it was found that the
petitioners had no claim for tenancy rights over the subject parcels of land. It was held by the
DAR Provincial Legal Officer that Francisco Landicho is the legal and bona fide tenant of the
parcels of land but he cannot be awarded disturbance compensation because he voluntarily
surrendered his tenancy rights over the said properties twice, through the 1976 and the
1987Kasulatan. In the case of Buenaventura and Federico Landicho, it was found that they are
merely farm helpers of Francisco Landicho and are not entitled to disturbance compensation.
Dissatisfied with the ruling of the DAR PARO of Lucena City, petitioners Buenaventura and
Federico Landicho filed another Protest before the DAR Legal Division, Region IV, Pasig,
Metro Manila. On February 15, 1993, a Memorandum20was issued by Legal Officer II,
Dandumum D. Sultan, Jr., which also dismissed the protest of the petitioners. It was likewise
found that Federico and Buenaventura are not tenants of the land in question but are merely farm
helpers of the legitimate tenant, Francisco Landicho, who surrendered his tenancy rights to the
former owner, the Aragons. During an interview with Buenaventura Landicho conducted by
Legal Officer II Dandumum Sultan, Jr. it was affirmed by Buenaventura that it was only
Francisco Landicho, his father, who was allowed and permitted to

_______________

18 Records of the Department of Agrarian Reform Adjudication Board, p. 34; Rollo, p. 8.


19 Records of the Department of Agrarian Reform Adjudication Board, p. 33.
20 Id., at p. 36.
611work on the subject land and that both he and Federico had not secured the permission of the
landowner to farm the land.21
In response to the complaint of BARC Chairman Rosalio Cabuyao, DAR Region IV Director
Percival C. Dalugdug wrote a letter, dated April 25, 1994, stating that the results of an
investigation conducted by their representatives revealed that Buenaventura Landicho and
Federico Landicho are not tenants of the subject land and are thus not entitled to disturbance
compensation. It was also stated in the letter that it is only Francisco Landicho who is the
legitimate tenant of the land owned by the Aragons. However, he surrendered his tenancy rights
by virtue of the 1976 and 1987 Kasulatan.22 The letter23 states:
Ika-25 ng Abril 1994
G. Rosalio J. Cabuyao
BARC Chairman
Brgy. Mationa, Tayabas, Quezon
Mahal na G. Cabuyao,
Kami po ay lumiham sa inyo upang ipaabot sa inyo ang pinakahuling ulat mula sa aming PARO sa
Quezon I [sic]hinggil sa inyong iniharap na reklamo na ayon po sa inyo ay hindi binibigyang pansin ni
Atty. Rolando Roldan.
xxxx
Hinggil naman sa pagbibigay ng disturbance compensationkina G. Buenaventura at Federico
Landicho, ikinalulungkot po naming ipaalam sa inyo na wala tayong sapat na batayan upang
magawa ito. Ayon sa pagsisiyasat na isinagawa ng aming kawani, ang magkapatid na Buenaventura at
Federico ay hindi kasama o walang ugnayang kasama (tenancy relationship) sa may-ari ng lupa
sapagkat ang kanilang ama ang siyang may karapatan at lehitimong kasama. Ayon din sa ulat, sa
pamamagitan ng kasulatan sa pagsasauli ng gawaing palayan ay isinuko na ni G. Francisco Landicho
ang kanyang mga karapatanbilang kasama at magsasaka sa lupang pinaguusapan. x x x.

_______________

21 Id.
22 Id., at p. 38.
23 Id.
612
Maraming salamat po sa inyong pagsulat at sana ay nabigyang linaw namin ang inyong hinaing.
Sumasainyo
(Sgd.)
Percival C. Dalugdug
Direktor Pangrehiyon
On June 10, 1994, petitioners Francisco Landicho, Federico Landicho and Buenaventura
Landicho filed a Complaint24 against Alberto Aragon, Jr., Alberto Aragon III and Felix Sia before
the DARAB for fixing and payment of disturbance compensation and awarding of home lot. The
petitioners allege that they are tenants of the subject land since January 31, 1976 and that they
were unlawfully ejected from the subject land by virtue of the 1976 and 1987Kasulatan which
they allege to be invalid, since they were executed by Francisco through the insidious words,
undue influence and strategy employed by the Aragons, in connivance with respondent Sia.
In their Answer25 dated July 7, 1994, the Aragons recognized only Francisco as their former
tenant until he surrendered his tenancy rights through the 1976Kasulatan and finally surrendered
the land upon the execution of the 1987Kasulatan. They assert that there was no undue
advantage exerted over petitioner Francisco Landicho since the 1976 and the
1987 Kasulatan were written in Tagalog, a language understood by Francisco.26 They raised the
defense that the petitioners have no cause of action on the grounds of prescription, laches, and
estoppel, that the claim is barred by prior judgment, and that the claim has been abandoned or
otherwise extinguished.27 On the other hand, respondent Felix Sia, in his Answer with
Counterclaim28 dated July 11, 1994, alleged that when he bought the subject parcels of land, they
were free from tenants since Francisco had already relin-

_______________

24 Id., at pp. 1-4.


25 Id., at pp. 13-15.
26 Id., at p. 13.
27 Id., at p. 14.
28 Id., at pp. 16-18.
613quished his tenancy rights therein through the execution of public documents.
After the filing of the parties’ respective position papers, the DAR Provincial Adjudicator of
Region IV rendered a decision in PARAD Case No. IV-QUI-0343-94,29 dated October 24, 1995,
in favor of the petitioners. Provincial Adjudicator Oscar C. Dimacali ruled that against their will,
the petitioners were dispossessed of the land that they have been cultivating. He also ruled that it
is not necessary to decide on the issue of whether Federico and Buenaventura are merely farm
helpers of Francisco, nor is it essential to determine whether the 1976 and 1987 Kasulatan are
valid. The dispositive portion30 of the decision reads:
“WHEREFORE, premises considered, the following are hereby ordered:
1. defendant Felix Sia to pay each of the plaintiffs a disturbance compensation equivalent to
five (5) years based from the average normal harvest to be determined by the MARO concerned
who is hereby required to make a report to this Office within one (1) month from receipt hereof;
2. defendant Felix Sia to provide each plaintiff a homelot [sic] of 200 square meters in the
subject landholdings; and,
3. defendants to pay the plaintiffs jointly and severally the sum of P10,000.00 as moral
damages and P5,000.00 as exemplary damages.
No pronounce [sic] as to cost.
SO ORDERED.”
The Aragons and respondent Sia appealed the foregoing decision to the DARAB,31which issued a
decision32 on September 18, 2000 that affirmed in part the decision of the Provincial Adjudicator,
and deleted the award of disturbance compensation on the basis of the finding that the petitioners
are still bona fide tenants in their respective landholdings. The DARAB did not give credit to the
report and recommendation of Legal Officer III Ernesto M. Arro and Legal Officer

_______________

29 Rollo, pp. 87-90.


30 Id., at p. 90.
31 DARAB Case No. 4599.
32 Rollo, pp. 91-98.
614II Dandumum D. Sultan, Jr. that Francisco Landicho voluntarily surrendered his tenancy
rights.33 The DARAB found that a tenancy relationship exists between the petitioners and the
Aragons and that when Felix Sia became the owner of the subject land, he assumed to exercise
the rights and obligations that pertain to the previous owners. The dispositive portion34 of the
DARAB decision provides:
“WHEREFORE, premises considered, the appealed decision dated October 24, 1995, is hereby
affirmed with MODIFICATION in so far as the disturbance compensation which is not obtaining in the
case at bar considering that plaintiffs-appellees are still bona fidetenants in their respective landholdings.
Furthermore, the DAR-BALA of Quezon Province in coordination with the Office of the DAR
Secretary, is hereby directed to file criminal charges for illegal conversion against defendants-appellants,
if circumstances may still warrant.
No Pronouncement as to Costs.
SO ORDERED.”
Felix Sia then filed a Petition for Review35 under Rule 43 with the Court of Appeals, which
rendered a decision36on February 23, 2005 that set aside the decision of the DARAB and
dismissed the complaint. The Court of Appeals found that the essential requisites are not present
to establish a tenancy relationship between petitioners Buenaventura and Federico Landicho and
the Aragons, and that the tenant-landlord relationship between Francisco Landicho and the
Aragons also ended upon the surrender of his tenancy rights through the 1976 and
1987 Kasulatan; consequently, no tenancy relationship also exists between the petitioners and
respondent Felix Sia. The Court of Appeals also ruled that even assuming that the petitioners
have a cause of action, the same had already prescribed since the

_______________

33 Id., at p. 95.
34 Id., at p. 97.
35 Id., at pp. 102-113.
36 Id., at pp. 73-80.
615complaint was only filed seven years from the time the cause of action accrued.37
On March 22, 2005, the petitioners filed a Motion for Reconsideration 38 of the Court of
Appeals decision. The Court of Appeals issued a Resolution39 on July 6, 2005, denying the
motion for reconsideration.
Hence, this Petition for Review on Certiorari40 of the Decision and Resolution of the Court of
Appeals with the following assignment of errors:41
“The Honorable Court of Appeals erred:
1. When it gave due course to the petition and consequently granted the same; and
2. When it disregarded the finding of facts [sic] of the DARAB that petitioners are bonafide
[sic] tenants of the land purchased by herein respondent and therefore entitled to security of
tenure.”
The parties filed their respective Memoranda42which both raised the following issues:43 (1)
whether or not the petitioners are bona fidetenants of the land purchased by the respondent; and
(2) whether or not the cause of action of the petitioners already prescribed at the time of the
filing of the complaint.
We deny the petition.
The case before us involves the determination of whether the petitioners are tenants of the land
purchased by the respondent, which is essentially a question of fact. As a general rule, questions
of fact are not proper in a petition under Rule 45.44But, since the findings of facts of the DARAB
and the Court of Appeals contradict each other, it

_______________

37 Id., at p. 79.
38 Id., at pp. 15-17.
39 Id., at pp. 81-83.
40 Id., at pp. 58-72.
41 Id., at p. 65.
42 Id., at pp. 174-197 and 199-209.
43 Id., at pp. 182 and 203A.
44 Rules of Court, Rule 45, Sec. 1.
616is crucial to go through the evidence and documents on record as a matter of exception to the
rule.45
In determining the existence of a tenancy relationship between the petitioners and the
respondent, it is necessary to make a distinction between petitioner Francisco Landicho and
petitioners Buenaventura and Federico Landicho.
With respect to Francisco, both the petitioners and the respondent agree that he was recognized
by the Aragons as a bona fide tenant of the subject land when he continued the cultivation of the
land after the death of his father Arcadio in 1972.46The dispute between the parties arose when
the petitioners were ejected from the land on the basis of the 1976 and the 1987Kasulatan, the
validity of which is questioned by the petitioners. The petitioners assert that the Aragons, the
predecessors-in-interest of the respondent, through insidious words and machinations, took
advantage of Francisco Landicho’s illiteracy and old age in order to make him sign the 1976 and
1987Kasulatan.47 The Aragons and respondent Felix Sia deny that they took advantage of
petitioner Francisco Landicho and the respondent also denies employing any fraudulent
scheme48 since both the 1976 and the 1987 Kasulatan were written in Tagalog, a language
understood by Francisco Landicho.49 They further argue that these are public documents, the
validity of which cannot be collaterally attacked.50 They aver that the 1976 and
1987Kasulatan were voluntarily executed by Francisco Landicho and that he willingly
surrendered

_______________

45 Esquivel v. Reyes, 457 Phil. 509, 516-517; 410 SCRA 404, 409-410 (2003); De Jesus v. Moldex Realty, Inc., G.R.
No. 153595, November 23, 2007, 538 SCRA 316, 320.
46 Records of the Department of Agrarian Reform Adjudication Board, pp. 1 and 13.
47 Id., at pp. 2, 49 and 56.
48 Rollo, p. 189.
49 Records of the Department of Agrarian Reform Adjudication Board, p. 13.
50 Id., at p. 17.
617his tenancy rights, which thus validly extinguished the tenancy relationship.51
With respect to Buenaventura and Federico Landicho, it is asserted by the petitioners that
they have been cultivating the three lots, which were divided among them for cultivation in this
wise:
TCT No. 135953 with Lot No. 9895—tenanted by Francisco Landicho
TCT No. 135952 with Lot No. 9896—tenanted by Federico Landicho
TCT No. 135929 with Lot No. 9897—tenanted by Buenaventura Landicho.52
They claim that there was an implied tenancy relationship because the Aragons have personal
knowledge of the fact that the petitioners were the ones who cultivated the land53 and they were
in continuous possession of the land until sometime in 1987 when they were unlawfully ejected
by virtue of the invalid 1987Kasulatan.54
The DARAB did not give credit to the report and recommendation of the DAR Provincial
Legal Officer and DAR Provincial Adjudicator of Region IV that Francisco Landicho voluntarily
surrendered his tenancy rights through the 1987Kasulatan and that Federico and Buenaventura
Landicho were merely farm helpers. The DARAB found that a landlord-tenant relationship exists
between the petitioners and the respondent and ruled in this wise:
“However, We find it hard to believe that plaintiffs-appellees who have been tilling the land in question
for so long a time, would suddenly lose interest in it for good time [sic] when they know that full
ownership over the same

_______________

51 Records of the Department of Agrarian Reform Adjudication Board, p. 29; Rollo, p. 181.
52 Records of the Department of Agrarian Reform Adjudication Board, p. 2. The 1976 Kasulatan, which is found in the
Records of the Department of Agrarian Reform Adjudication Board, pp. 7-8, designated the lots as TCT No. 135953—Lot No.
9297, TCT No. 135952—Lot No. 9856, and TCT No. 135929—Lot No. 9895. The 1987Kasulatan, on the other hand, provides
that TCT No. 135953 contains Lot No. 9897, Lot No. 9856, and Lot No. 9895.
53 Rollo, p. 203A.
54 Records of the Department of Agrarian Reform Adjudication Board, p. 44.
618would soon be in their hands. Besides, plaintiffs-appellees Francisco Landicho et., [sic] al., would not
even thought [sic] of filing a complaint if they have already abandoned or surrendered the subject
landholdings in favor of herein defendants-appellants. Anyone in his right mind for that matter, would not
waste time[,] effort and money especially if he is poor to prosecute an unworthy action.”55
The Court of Appeals reversed the decision of the DARAB and agreed with the ruling of the
DAR PARO and the Region IV DAR Legal Division that only petitioner Francisco Landicho
was the tenant of all of the three lots covered by TCT No. 135953, TCT No. 135952 and TCT
No. 135929 and that he voluntarily surrendered his tenancy rights upon the execution of the
1987Kasulatan. The Court of Appeals also agreed with the PARO and the Region IV DAR that
Federico and Buenaventura Landicho were merely farm helpers of Francisco, ruling that they
were considered as part of thebona fide tenant’s immediate farm household and for this reason,
the Aragons cannot be faulted for not questioning their possession and cultivation of the subject
landholdings.56
We agree with the Court of Appeals and give credence to the findings of the DAR PARO and
Region IV DAR.
A tenant is defined under Section 5(a) of Republic Act No. 1199, otherwise known as the
Agricultural Tenancy Act of the Philippines, as:
“x x x a person who, himself and with the aid available from within his immediate farm household,
cultivates the land belonging to, or possessed by, another, with the latter’s consent for purposes of
production, sharing the produce with the landholder under the share tenancy system, or paying to the
landholder a price certain or ascertainable in produce or in money or both, under the leasehold tenancy
system.”57
A tenancy relationship arises between a landholder and a tenant once they agree, expressly or
impliedly, to undertake jointly the cultivation of a land belonging to the landholder, as a result of
which

_______________

55 Rollo, p. 95.
56 Id., at p. 78.
57 Republic Act No. 1199 (1954), Sec. 5(a).
619relationship the tenant acquires the right to continue working on and cultivating the land.58
The existence of a tenancy relationship cannot be presumed and claims that one is a tenant do
not automatically give rise to security of tenure.59 For a tenancy relationship to exist, all of the
following essential requisites must be present: (1) the parties are the landowner and the tenant;
(2) the subject matter is agricultural land; (3) there is consent between the parties; (4) the purpose
is agricultural production; (5) there is personal cultivation by the tenant; and, (6) there is sharing
of the harvests between the parties.60
Not all of these requisites obtain in the case at bar.
The essential element of consent is absent because the landowners never recognized
petitioners Federico and Buenaventura Landicho as legitimate tenants of the subject land. And,
although Federico and Buenaventura claim that they are tenants of “Lot No. 9896 and Lot No.
9897,”61 respectively, simply because they continuously cultivated and openly occupied the
subject land; there was no evidence presented to establish the presence of the essential requisites
of a tenancy relationship other than the self-serving statements of the petitioners. Furthermore,
both the 1976 and the 1987Kasulatan only mentioned Francisco as the tenant of the subject
parcels of land, and there was no mention of petitioners Federico and Buenaventura.
The petitioners cannot rely on their self-serving statements to prove the existence of a tenancy
relationship because independent and concrete evidence, aside from self-serving statements, is
needed to prove personal cultivation, sharing of harvests, or consent of the

_______________

58 Republic Act No. 1199 (1954), Sec. 6.


59 Cornelio de Jesus, et al. v. Moldex Realty, Inc., G.R. No. 153595, November 23, 2007, 538 SCRA 316, 321.
60 Verde v. Macapagal, G.R. No. 151342, June 23, 2005, 461 SCRA 97, 106; Vda. de Victoria v. Court of Appeals,
G.R. No. 147550, January 26, 2005, 449 SCRA 319, 335.
61 The 1976 and 1987Kasulatan, which are found in the Records of the Department of Agrarian Reform Adjudication
Board, pp. 7-8 designated the lots as Lot No. 9856 and Lot No. 9895.
620landowner.62 A tiller or a farmworker does not automatically become an agricultural tenant
recognized under agrarian laws by mere occupation or cultivation of an agricultural land.63
The DARAB did not cite any evidence to show the existence of the requisites of a tenancy
relationship and merely based the conclusion that the petitioners are tenants of the Aragons on
the weak reasoning that filing a complaint is inconsistent with the voluntary surrender of the
landholdings and that it is unlikely that petitioners would suddenly lose interest in the subject
land when they know that ownership would soon be transferred to them.64 The DARAB’s
inferences are without basis and are purely speculative, and except for its sweeping conclusion,
there is no other independent and concrete evidence in the record of the case that would sustain
the finding that Federico and Buenaventura are tenants of the Aragons.
It was not shown that Federico and Buenaventura cultivated the land with the consent of the
landowners. The Court of Appeals correctly held that only Francisco was the bona fidetenant of
the land in question and that Federico and Buenaventura were just farm helpers of Francisco, as
part of his immediate farm household.65 This is supported by the evidence on record where, in the
Memorandum of DAR Region IV Legal Officer II Dandumum Sultan, Jr., it is stated that during
an interview conducted with Buenaventura Landicho, he disclosed that it was only Francisco
Landicho, his father, who was allowed and permitted to work on the subject land and that both
he and Federico had not secured the permission of the landowner to farm the land.66

_______________

62 Heirs of Jugalbot v. Court of Appeals, G.R. No. 170346, March 12, 2007, 518 SCRA 202, 214-215,
citing Berenguer, Jr. v. Court of Appeals, G.R. No. L-60287, August 17, 1988, 164 SCRA 431, 438-439.
63 Danan v. Court of Appeals, G.R. No. 132759, October 25, 2005, 474 SCRA 113, 126.
64 Rollo, p. 95.
65 Id., at p. 78.
66 Records of the Department of Agrarian Reform Adjudication Board, p. 36.
621There was also no evidence presented to show that Federico and Buenaventura gave a
share of their harvest to the Aragons. Independent evidence, such as receipts, must be presented
to show that there was a sharing of the harvest between the landowner and the tenant. 67And,
assuming the landowners received a share of the harvest, it was held in the case of Cornelio de
Jesus, et al. v. Moldex Realty, Inc.68 that “[t]he fact of receipt, without an agreed system of
sharing, does not ipso facto create a tenancy.”69
There is no tenancy relationship between the Aragons and petitioners Federico and
Buenaventura without the essential elements of consent and sharing of agricultural produce.70
Neither can we give any weight to the petitioners’ contention that there was an implied
tenancy by reason alone of their continuous cultivation of the land. Acquiescence by the
landowner of their cultivation of the land does not create an implied tenancy if the landowners
have never considered petitioners Federico and Buenaventura as tenants of the land and if the
essential requisites of a tenancy relationship are lacking. There was no intention to institute the
petitioners as agricultural tenants. In the case of Epitacio Sialana v. Mary Y. Avila, et al.71 it was
held that “x x x for an implied tenancy to come about, the actuations of the parties taken in their
entirety must be demonstrative of an intent to continue a prior lease established by the landholder
x x x.”72
With respect to petitioner Francisco Landicho, the Court of Appeals also correctly held that
although Francisco was the legal tenant of the subject land, he voluntarily surrendered his
tenancy rights when he knowingly and freely executed the 1987Kasulatan.73 This conclusion
finds basis in the investigation conducted by the PARO,

_______________

67 Heirs of Jugalbot v. Court of Appeals, G.R. No. 170346, March 12, 2007, 518 SCRA 202, 213.
68 G.R. No. 153595, November 23, 2007, 538 SCRA 316.
69 Id., at p. 323.
70 Supra, note 67.
71 G.R. No. 143598, July 20, 2006, 495 SCRA 501.
72 Id., at p. 509.
73 Rollo, p. 78.
622where during the mediation conference, petitioner Francisco Landicho admitted that he
voluntarily surrendered his tenancy rights over the subject parcels of land in consideration of
PhP3,000.00.74 The tenancy relationship was validly extinguished through the execution of the
1987Kasulatan and upon the voluntary surrender of the landholdings pursuant to Section 8 of
Republic Act No. 3844, otherwise known as the Agricultural Land Reform Code, to wit:
“SECTION 8. Extinguishment of Agricultural Leasehold Relation.—The agricultural leasehold
relation established under this Code shall be extinguished by:
(1) Abandonment of the landholding without the knowledge of the agricultural lessor;
(2) Voluntary surrender of the landholding by the agricultural lessee, written notice of which shall
be served three months in advance; or
(3) Absence of the persons under Section nine to succeed to the lessee, in the event of death or
permanent incapacity of the lessee.”75
The petitioners also failed to support their claim that the Aragons took advantage of
Francisco’s old age and illiteracy and employed fraudulent schemes in order to deceive him into
signing the Kasulatan. It has been held that “[a] person is not incapacitated to contract merely
because of advanced years or by reason of physical infirmities. It is only when such age or
infirmities impair the mental faculties to such extent as to prevent one from properly,
intelligently, and fairly protecting her property rights, is she considered incapacitated.”76
The petitioners’ contention that the Aragons employed fraud, aside from being unsubstantiated,
is also contrary to the records of the case. Both the 1976 and the 1987 Kasulatan were also
written in Tagalog, which is the language understood by Francisco Landicho. They were written
in an uncomplicated manner and clearly stated that he is returning the land that he has been
cultivating to the land-

_______________

74 Records of the Department of Agrarian Reform Adjudication Board, p. 34; Rollo, p. 8.


75 Republic Act No. 3844 (1963), Sec. 8.
76 Mario J. Mendezona v. Julio H. Ozamiz, et al., 426 Phil. 888, 906; 376 SCRA 482, 498 (2002).
623owners because he is already old and could no longer work on the land.77 The
1987Kasulatan also states that the contents of the document were read to him and that he
understands the same.
It is also important to note that both the 1976 and 1987Kasulatan are duly notarized and are
considered as public documents evidencing the surrender of Francisco’s tenancy rights over the
subject landholdings. They were executed with all the legal formalities of a public document and
thus the legal presumption of the regularity and validity of theKasulatan are retained in the
absence of full, clear and convincing evidence to overcome such presumption.78Strong evidence
is required to prove a defect of a public instrument,79 and since such strong and convincing
evidence was not presented in the instant case, the 1976 and the 1987 Kasulatan are presumed
valid.
Coming now to the second issue of prescription, the petitioners argue that they did not sleep
on their rights because although the Complaint with the DARAB was filed on June 10, 1994,
they already filed a protest before the DAR Legal Division of Lucena prior to their Complaint
before the DARAB.80
This contention cannot be sustained.
An action to enforce rights as an agricultural tenant is barred by prescription if not filed
within three (3) years.81Section 38 of Republic Act No. 3844, otherwise known as the
Agricultural Land Reform Code, specifically provides that:
“SECTION 38. Statute of Limitations.—An action to enforce any cause of action under this Code
shall be barred if not commenced within three years after such cause of action accrued.”82

_______________

77 Records of the Department of Agrarian Reform Adjudication Board, p. 8.


78 Hermenegildo Agdeppa v. Emiliano Ibe, G.R. No. 96770, March 30, 1993, 220 SCRA 584, 594, citing Favor v.
Court of Appeals, G.R. No. 80821, February 21, 1991, 194 SCRA 308, 313.
79 Supra, note 74.
80 Rollo, p. 206.
81 Republic Act No. 3844 (1963), Sec. 38.
82 Id.
624The records of the case show that the protest before the DAR Legal Division of Lucena
was filed sometime in 1992 when the case was set for a mediation conference.83 Even assuming
that they have a cause of action, this arose in 1987 when they were ejected from the landholdings
they were cultivating which means that it took them about five (5) years to file a protest before
the DAR Legal Division of Lucena, and it took them seven (7) years to file a Complaint before
the DARAB. Clearly, their cause of action has already prescribed.
Accordingly, the petitioners’ complaint against the respondent is dismissible on the ground of
prescription and for lack of cause of action.
IN VIEW WHEREOF, the Decision and Resolution of the Court of Appeals under review are
hereby AFFIRMED without pronouncement as to costs.
SO ORDERED.
Carpio, Corona, Azcunaand Leonardo-De Castro, JJ.,concur.
Judgment and resolution affirmed.
Notes.—A land registration court has no jurisdiction to adjudicate the existence or non-
existence of a tenancy relationship. (Cuaño vs. Court of Appeals, 237 SCRA 122 [1994])
Where a lot is sold to another person, the claim of tenancy over said lot should be directed
against the new owners/vendees, who are subrogees to the rights and obligations of the
agricultural lessor/vendor. (Pascual vs. Court of Appeals, 371 SCRA 338 [2001])

G.R. No. 176942. August 28,2008.*


NICORP MANAGEMENTAND DEVELOPMENTCORPORATION,
petitioner,vs. LEONIDA DE LEON, respondent.
G.R. No. 177125. August 28,2008.*
SALVADOR R. LIM,petitioner, vs. LEONIDA DELEON, respondent.
Tenancy Law; Essential elements of a tenancy relationship; All the foregoing requisites must be
proved by substantial evidence and the absence of one will not make an alleged tenant a de jure tenant.—
There is a tenancy relationshipif the following essentialelements concur: 1) the partiesare the landowner a
nd thetenant or agricultural lessee; 2)the subject matter of therelationship is an agriculturalland; 3) there is
consent betweenthe parties to the relationship; 4)the purpose of the relationship isto bring

_______________

** Justice Antonio C. Carpio was designated to sit as additional member replacing Justice Antonio Eduardo B. Nachura
per Raffle dated 30 October 2007.
* THIRD DIVISION.
607
VOL. 563, 6
AUGUST 28, 2008 07
NICORP Management
and Development
Corporation vs. De Leon
about agricultural production; 5)there is personal cultivation onthe part of the tenant oragricultural le
ssee; and 6) theharvest is shared betweenlandowner and tenant oragricultural lessee.
All theforegoing requisites must beproved by substantial evidenceand the absence of one will notmake an
alleged tenant a de juretenant. Unless a person hasestablished his status as a de
juretenant, he is not entitled tosecurity of tenure or covered bythe Land Reform Program of theGovernme
nt under existingtenancy laws.
Same; Same; Occupancy and continued possession of the land will not ipso facto make one a de jure
tenant.—
That respondentwas allowed to cultivate theproperty without opposition, doesnot mean that the De Leonsi
sters impliedly recognized theexistence of a leasehold relationwith respondent. Occupancy andcontinued
possession of the landwill not ipso facto make one a de
jure tenant. The principal factorin determining whether atenancy relationship exists isintent. Tenancy is n
ot a purelyfactual relationship dependenton what the alleged tenant doesupon the land but is, moreso, aleg
al relationship. Thus, theintent of the parties, theunderstanding when the farmeris installed, and their writt
enagreements, provided these arecomplied with and are notcontrary to law, are moreimportant.
PETITIONS for review oncertiorari of the decisionand resolution of theCourt of Appeals.
The facts are stated in theopinion of the Court.
Ligon, Solis, Corpus, Mejia Law Firm for petitioner.
Montano, Flamiano & Associates Law Offices for petitioner Salvador R. Lim.
Byron S. Anastacio for respondent Leonida De Leon.
YNARES-SANTIAGO, J.:
These consolidated petitionsassail the November 8, 2006Decision1 of the Court ofAppeals in CA
-G.R. SP No.92316,

_______________
1 Rollo in G.R. No. 177125, pp. 42-
49; penned by Associate JusticeSantiago Javier Ranada andconcurred in by Associate JusticesConrado M. Vasquez, Jr. an
d JoseC. Mendoza.
608
608 SUPREME COURT
REPORTS
ANNOTATED
NICORP Management and
Development Corporation vs.
De Leon
finding respondent LeonidaDe Leon as a bona
fidetenant of the subjectproperty, thereby reversingand setting aside theDecision of the Departme
ntof Agrarian ReformAdjudication Board(DARAB) in DARAB CaseNo. 135022 which affirmedt
he Decision3 of the RegionalAdjudicator in DARAB CaseNo. 0402-031-
03. Alsoassailed is the March 1, 2007Resolution4 denying themotions for reconsideration.
On August 26, 2004,respondent filed a complaintbefore the Office of theProvincial Agrarian
ReformAdjudicator (PARAD) ofRegion IV -
Province ofCavite, praying thatpetitioners Salvador R. Limand/or NICORPManagement andDev
elopment Corporation(NICORP) be ordered torespect her tenancy rightsover a parcel of land loc
atedin Barangay Mambog III,Bacoor, Cavite, registeredunder TCT No. T-
72669 inthe name of Leoncia De Leonand Susana De LeonLoppacher (De Leon sisters),who wer
e likewise impleadedas parties-defendants in thesuit.
Respondent alleged thatshe was the actual tiller andcultivator of the land sincetime immemori
al with fullknowledge and consent of theowners, who were her sisters-in-
law; that sometime in2004, petitioners circulatedrumors that they havepurchased the property fro
mthe De Leon sisters; thatpetitioners ignoredrespondent’s requests to showproof of their alleged
ownership; that on August12, 2004, petitioners enteredthe land and uprooted anddestroyed the ri
ce planted onthe land and graded portionsof the land with the use ofheavy equipment; that theinc
ident was reported to theMunicipal Agrarian ReformOffice (MARO) which issueda Cease and D
esist Order5but to no avail.

_______________

2 Id., at pp. 34-41.


3 Id., at pp. 21-31.
4 Id., at pp. 61-
62; penned byAssociate Justice Conrado M.Vasquez, Jr. and concurred in byAssociate Justices Jose C. Mendozaand Rosal
inda Asuncion-Vicente.
5 CA Rollo, p. 156.
609
VOL. 563, AUGUST 609
28, 2008
NICORP Management and
Development Corporation vs.
De Leon
Respondent thus prayedthat petitioners be ordered torespect her tenancy rightsover the land; r
estore theland to its original conditionand not to convert the sameto non-
agricultural use; thatany act of disposition of theland to any other person bedeclared null and voi
dbecause as a tenant, sheallegedly had a right of pre-
emption or redemption overthe land; and for actualdamages and attorney’s fees.6
Petitioner Lim deniedthat respondent was a tenantof the subject property underthe Comprehe
nsive AgrarianReform Program (CARP). Healleged that respondent is aseptuagenarian who is no
longer physically capable oftilling the land; that theMARO issued a certification7that the land ha
d noregistered tenant; thatrespondent could not beregarded as a landless tillerunder the CARP be
cause sheowns and resides in theproperty adjacent to thesubject land which sheacquired throughi
nheritance; that an Affidavitof Non-
Tenancy8 wasexecuted by the De Leonsisters when they sold theproperty to him.
Moreover, Lim claimedthat respondent and herfamily surreptitiouslyentered the subject land a
ndplanted a few crops to passthemselves off as cultivatorsthereof; that respondent triedto negotia
te with petitionerLim for the sale of the land toher, as the latter wasinterested in entering into ajoi
nt venture with anotherresidential developer, whichshows that respondent hassufficient resources
andcannot be a beneficiaryunder the CARP; that theland is no longer classified asagricultural an
d could notthus be covered by theCARP. Per certificationissued by the Office of theMunicipal Pl
anning andDevelopment Coordinator ofBacoor, Cavite, the land isclassified as residentialpursua
nt to aComprehensive Land UsePlan approved by theSangguniang Panlalawigan.9

_______________

6 Id., at pp. 33-37.


7 Id., at p. 54.
8 Id., at p. 57.
9 Id., at pp. 47-50.
610
610 SUPREME COURT
REPORTS
ANNOTATED
NICORP Management and
Development Corporation vs.
De Leon
For its part, petitionerNICORP asserted that it wasnot a proper party to the suitbecause it has
not actuallyacquired ownership of theproperty as it is stillnegotiating with the owners.However, i
t joined inpetitioner Lim’s assertionthat respondent is not aqualified tenant; and thatthe subject la
nd could not becovered by the CARP since itis below the minimumretention area of fivehectares
allowed under theprogram.10 Eventually,NICORP purchased thesubject property from Lim onOct
ober 19, 2004.11
The De Leon sisters didnot file a separate answer torespondent’s complaint.
Meanwhile, ProvincialAdjudicator Teodoro A.Cidro, to whom the case wasassigned, died. Th
us, the casewas referred to the Office ofthe Regional AgrarianReform Adjudicator(RARAD) for
resolution.
In compliance with thedirective of the RARAD,respondent submitted asevidence an Extra-
JudicialSettlement of Estate12 datedFebruary 20, 1989 to provethat, as a result of herrelationship
with her sisters-in-
law, she was made atenant of the land; a taxdeclaration13 showing thatthe land was classified asirr
igated riceland; severalaffidavits14 executed byfarmers of adjacent landsstating that respondent an
dher family were tenants-
farmers on the subject land;and several documents andreceipts15 to prove theagricultural activities
ofrespondent and her family.
Respondent likewisesubmitted a handwrittenletter16 of Susana De Leonaddressed to responden
t’sdaughter Dolores, showingthat the former purportedlyacknowledged respon-

_______________

10 Id., at p. 59.
11 Rollo in G.R. No. 176942, pp.27-28.
12 CA Rollo, p. 128.
13 Id., at p. 132.
14 Id., at pp. 133-135.
15 Id., at pp. 137-143.
16 Id., at pp. 146-147.
611
VOL. 563, AUGUST 611
28, 2008
NICORP Management and
Development Corporation vs.
De Leon
dent’s son, Rolando, as thelegitimate tenant-
lessee onthe land. However, Rolandodied on September 1, 2003 asevidenced by his deathcertific
ate.17
On December 6, 2004, theRARAD rendered a Decisiondismissing the complaint forfailure of
respondent to proveby substantial evidence allthe requisites of anagricultural tenancyrelationship
.18 There was noevidence to show that the DeLeon sisters constitutedrespondent as tenant-
lesseeon the land; neither was itproved that there wassharing of harvests with thelandowner.
The DARAB affirmed thedecision of the RARAD.19
On appeal, the Court ofAppeals reversed and setaside the findings of theRARAD/DARAB sta
ting thatthere was sufficient evidenceto prove the elements of anagricultural tenancyrelationship;
that the letterof Susana De Leon to Doloresclearly acknowledgedrespondent’s son, Rolando, asa
tenant, as well asrespondent’s share in theproceeds of the sale of theland; and that the sharing of
produce was established bythe affidavits of neighboringfarmers that were notcontroverted by peti
tioners.
The appellate courtfurther held that thereclassification of the land bythe Sangguniang
Panlalawigan as residentialcannot be given weightbecause it is only theDepartment of Agrarian
Reform (DAR) that canreclassify or convert anagricultural land to otheruses or classifications; an
dthat the sale of the land bythe De Leon sisters topetitioner Lim is voidbecause it violated Sectio
n 70of Republic Act (R.A.) No.665720 or the ComprehensiveAgrarian Reform Law(CARL).
Petitioners filed a motionfor reconsideration but it wasdenied.21 Hence, petitionersLim and NI
CORP separately filed

_______________

17 Id., at p. 145.
18 Rollo in G.R. No. 177125, pp.27-31.
19 Id., at pp. 34-41.
20 Id., at pp. 46-48.
21 Id., at pp. 61-62.
612
612 SUPREME COURT
REPORTS
ANNOTATED
NICORP Management and
Development Corporation vs.
De Leon
petitions under Rule 45 ofthe Rules of Court, whichwere consolidated perresolution of the Court
datedJune 4, 2007.22
Petitioners allege thatrespondent failed to prove bysubstantial evidence all theelements of a te
nancyrelationship; hence the Courtof Appeals erred in findingthat respondent has tenancyrights o
ver the subject land.
The petitions aremeritorious.
There is a tenancyrelationship if the followingessential elements concur: 1)the parties are the l
andownerand the tenant oragricultural lessee; 2) thesubject matter of therelationship is anagricult
ural land; 3) there isconsent between the partiesto the relationship; 4) thepurpose of the relations
hip isto bring about agriculturalproduction; 5) there ispersonal cultivation on thepart of the tenant
oragricultural lessee; and 6)the harvest is sharedbetween landowner andtenant or agriculturalless
ee.23 All the foregoingrequisites must be proved bysubstantial evidence and theabsence of one wil
l not makean alleged tenant a de juretenant.24 Unless a person hasestablished his status as a de
jure tenant, he is not entitledto security of tenure orcovered by the Land ReformProgram of the
Governmentunder existing tenancylaws.25
In the instant case, thereis no substantial evidence tosupport the appellate court’sconclusion th
at respondent isa bona
fide tenant on thesubject property. Respondentfailed to prove the third andsixth elements cited ab
ove. Itwas not shown that the DeLeon sisters consented to atenancy relationship withrespondent
who was theirsister-in-law; or that
_______________

22 Id., at p. 63.
23 Dalwampo v. Quinocol Farm Workers and Settlers’ Asso-
ciation,G.R. No. 160614, April 25, 2006,488 SCRA 208, 221.
24 Suarez v. Saul, G.R. No.166664, October 20, 2005, 473SCRA 628, 634.
25 Ambayec v. Court of Appeals,G.R. No. 162780, June 21, 2005,460 SCRA 537, 543.
613
VOL. 563, AUGUST 613
28, 2008
NICORP Management and
Development Corporation vs.
De Leon
the De Leon sisters receivedany share in the harvests ofthe land from respondent orthat the latter
delivered aproportionate share of theharvest to the landownerspursuant to a tenancyrelationship.
The letter of Susana DeLeon to Dolores, whichallegedly proved consent ofthe De Leon sisters
to thetenancy arrangement,partially reads:
“Nuong ako ay nandiyan,hindi nagkaayos ang bukid kasiang iyong Kuya Roly ay ayawna si Noli ang
ahente. Pero bagoako umalis ay nagkasundo kamini Buddy Lim (Salvador) naaayusin niya at itutuloy ang
bilihan at siya ang bahala saKuya Roly mo.
Kaya nagkatapos kami at angkasama ng Kuya mo ngayon aysi Buddy Lim. Ang pera na parasa kasam
a ay na kay BuddyLim. Ang kaparte ng NanayOnching (Leoncia) mo ay nasaakin ang karamihan at ako n
aang mag-aasikaso.”
The Court cannot agreewith the appellate court’sconclusion that from thetenor of the letter, it
is clearthat Susana acknowledgedrespondent’s deceased son as“kasama” or tenant, andrecognize
d as wellrespondent’s share in theproceeds of the sale, thusproving the existence of animplied lea
sehold relationsbetween the De Leon sistersand respondent.26 The word“kasama” could be taken i
nvarying contexts and notnecessarily in relation to anagricultural leaseholdagreement. It is also u
nclearwhether the term “kasama”referred to respondent’sdeceased son, Rolando, orsome other pe
rson. In thefirst sentence of the secondparagraph, the word“kasama” referred topetitioner Lim wh
ile thesecond sentence of the sameparagraph, did not refer byname to Rolando as“kasama.”
Likewise, “Nanay Onching,”as mentioned in the letter,referred to Leoncia, one ofthe De Leon sis
ters, on whosebehalf Susana kept part ofthe proceeds of the sale, andnot herein respondent asund
erstood by the Court ofAppeals, who had

_______________

26 Rollo in G.R. No. 177125, p. 47.


614
614 SUPREME COURT
REPORTS
ANNOTATED
NICORP Management and
Development Corporation vs.
De Leon
no right to such share. It isLeoncia who co-
owned theproperty with Susana andwho is therefore entitled to apart of the sale proceeds.
Significantly, respondentwas
not mentioned at all inSusana’s letter, but only herson, Rolando. However, evenif we construe th
e term“kasama” as pertaining toRolando as a tenant of the DeLeon sisters, respondent willnot ne
cessarily be conferredthe same status as tenantupon her son’s death. Adirect ascendant or parent i
snot among those listed inSection 9 of Republic Act No.3844 which specificallyenumerates the o
rder ofsuccession to the leaseholdrights of a deceased orincapacitated agriculturaltenant, to wit:
“In case of death orpermanent incapacity of theagricultural lessee to work hislandholding, the leasehol
d shallcontinue between theagricultural lessor and theperson who can cultivate thelandholding personally,
chosenby agricultural lessor within onemonth from such death orpermanent incapacity, fromamong the f
ollowing: (a) thesurviving spouse; (b) the eldestdirect descendant byconsanguinity; or (c)
the nexteldest descendant or descendantsin the order of their age. x x xProvided,
further, that in theevent that the agricultural lessorfails to exercise his choice withinthe period herein prov
ided, thepriority shall be in accordancewith the order hereinestablished.”
There is no evidence thatthe De Leon sistersconsented to constituterespondent as their tenanto
n the subject land. Ascorrectly found by theRARAD/DARAB, even theExtra-
Judicial Settlement ofEstate that respondentoffered in evidence to provethe alleged consent does
notcontain any statement fromwhich such consent can beinferred.27 Absent any otherevidence to
prove that the DeLeon sisters consented to thetenurial arrangement,respondent’s cultivation ofthe
land was by meretolerance of her sisters-in-law.
The appellate court foundthat the element of sharingin the produce of the land
was established by theaffidavits of

_______________

27 Rollo in G.R. No. 176942, p.36.


615
VOL. 563, AUGUST 615
28, 2008
NICORP Management and
Development Corporation vs.
De Leon
neighboring farmers attesting to the fact thatrespondent cultivated theland
since timeimmemorial. However,
28

perusal of the said affidavitsreveals that there is nothingtherein that would indicate asharing of pr
oduce betweenthe De Leon sisters andrespondent. The affidavitsdid not mention at all thatthe De
Leon sisters receiveda portion of the harvests orthat respondent deliveredthe same to her sisters-
in-
law. The affidavits failed todisclose the circumstances ordetails of the alleged harvestsharing; it
merely stated thatthe affiants have knownrespondent to be thecultivator of the land sincetime im
memorial. It cannottherefore be deemed asevidence of harvest sharing.
The other pieces ofevidence submitted byrespondent likewise do notprove the alleged tenancy
relationship. The summaryreport of the Philippine CropInsurance Corporation, theofficial receipt
s issued by theNational Food Authority andthe certificate of membershipin Bacoor Agricultural
Multi-
Purpose Cooperative,29 onlyprove that respondent andher family engaged inagricultural activities
butnot necessarily her allegedstatus as tenant of the DeLeon sisters. Besides, thesedocuments are
not even inthe name of respondent butwere issued in favor of herdaughter Dolores.
That respondent wasallowed to cultivate theproperty without opposition,does not mean that th
e DeLeon sisters impliedlyrecognized the existence of aleasehold relation withrespondent. Occup
ancy andcontinued possession of theland will not ipso facto makeone a de
jure tenant. Theprincipal factor indetermining whether atenancy relationship exists isintent. Ten
30

ancy is not apurely factual relationshipdependent on what thealleged tenant does upon theland bu
t is, moreso, a legalrelationship.31 Thus, theintent of the parties, the un-

_______________

28 CA Rollo, pp. 133-136.


29 Id., at pp. 137-142.
30 Ambayec v. Court of Appeals, supra note 25 at p. 545.
31 Sialana v. Avila, G.R. No.143598, July 20, 2006, 495 SCRA501, 507-508.
616
616 SUPREME COURT
REPORTS
ANNOTATED
NICORP Management and
Development Corporation vs.
De Leon
derstanding when the farmeris installed, and their writtenagreements, provided theseare complied
with and arenot contrary to law, are moreimportant.32
Finally, the sale of thesubject land to petitionersdid not violate Sections 6533and 7334 (c) of R.
A. No. 6657.There was no illegalconversion of the landbecause Sec. 65 applies onlyto lands whi
ch were coveredby the CARP, i.e. those landsbeyond the five-
hectareretention limit allowed tolandowners under the law,which were distributed tofarmers-
benefi-
ciaries. In theinstant case, it was not shownthat the subject land wascovered by the CARP.Neithe
r was it shown that thesale was made to circumventthe application of R.A. 6657or aimed at dispo
ssessingtenants of the land that theytill.
The sale of the land topetitioners likewise did notviolate R.A. No. 3844 or theAgricultural Tenan
cy Act.Considering that respondenthas failed to establish herstatus as de
jure tenant, shehas no right of pre-emptionor redemption under
_______________

32 Heirs of Nicolas Jugalbot v. Court of Appeals, G.R. No. 170346,March 12, 2007, 518 SCRA 202,210.
33 SECTION 65. Conversion of Lands.—
After the lapse of five (5)years from its award, when theland ceases to be economicallyfeasible and sound for agriculturalp
urposes, or the locality has becomeurbanized and the land will havegreater economic value forresidential, commercial orin
dustrial purposes, the DAR, uponapplication of the beneficiary or thelandowner, with due notice to theeffected parties, and
subject toexisting laws, may authorize thereclassification or conversion of theland and its disposition: Provided,That the b
eneficiary shall havefully paid his obligation.
34 SECTION 73. Prohibited Acts and Omissions.—Thefollowing are prohibited:
xxxx
(c) The conversion by anylandowner of his agricultural landinto any non-
agricultural use withintent to avoid the application ofthis Act to his landholdings and todispossess his tenant farmers of the
land tilled by them.
617
VOL. 563, AUGUST 617
28, 2008
NICORP Management and
Development Corporation vs.
De Leon
Sections 1135 and 1236 of thesaid law. Even assuming thatrespondent’s son Rolandowas a tenant o
f the De Leonsisters, his deathextinguished any leaseholdon the subject land. Section837 of R.A. 3
844 specificallyprovides for the extinction ofan agricultural leaseholdrelation, in the absence ofp
ersons enumerated underSection 9 of the law who arequalified to succeed thedeceased tenant.
WHEREFORE, thepetitions are GRANTED.The Decision of the Court ofAppeals in CA-
G.R. SP No.92316 and the Resolutiondenying the motions forreconsideration areREVERSED an
d SETASIDE. The Decision of theDepartment of AgrarianReform Adjudication Boardin DARA
B Case No. 13502,which affirmed in
toto theDecision of the RegionalAdjudicator in DARAB CaseNo. 0402-031-
03, dismissingthe complaint of respondentLeonida De Leon for lack ofmerit, is REINSTATED a
ndAFFIRMED.
SO ORDERED.

G.R. No. 86186. May 8, 1992. *

RAFAEL GELOS, petitioner,vs. THE HONORABLE COURT OF APPEALS and ERNESTO


ALZONA, respondents.
Appeal; Court; Judgment;Motions; Factual findings of the Court of Appeals are conclusive as long
as they are supported by substantial evidence.—The settled rule is that the factual findings of the Court of
Appeals are conclusive on even this Court as long as they are supported by substantial evidence. The
petitioner has not shown that his case comes under any of those rare exceptions when such findings may
be validly reversed by this Court.
Land Reform to Public Lands; Tenancy; Tenancy relationship is determined not by the nature of the
work involved but by the intention of the parties.—It is not the nature of the work involved but the
intention of the parties that determines the relationship between them. As this Court has stressed in a
number of cases, “tenancy is not a purely factual relationship dependent on what the alleged tenant does
upon the land. It is also a legal relationship. The intent of the parties, the understanding when the farmer
is installed, and as in this case, their written agreements, provided these are complied with and are not
contrary to law, are even more important.”

PETITION for review of the decision of the Court of Appeals.

The facts are stated in the opinion of the Court.


Balagtas P. Ilagan for petitioner.
Emil Capulong, Jr. for private respondent.

CRUZ, J.:

The Court is asked to determine the real status of the petitioner, who claims to be a tenant of the
private respondent and entitled to the benefits of tenancy laws. The private respondent objects,
contending that the petitioner is only a hired laborer whose right to occupy the subject land
ended with the termination of their contract of employment.
The subject land is a 25,000 square meter farmland situated in Cabuyao, Laguna, and
belonging originally to private re-

_____________

*
FIRST DIVISION.
609
VOL. 208, MAY 8, 609
1992
Gelos vs. Court of Appeals
spondent Ernesto Alzona and his parents in equal shares. On July 5, 1970, they entered into a
written contract with petitioner Rafael Gelos employing him as their laborer on the land at the
stipulated daily wage of P5.00. On September 4, 1973, after Alzona had bought his parents’
1

share and acquired full ownership of the land, he wrote Gelos to inform him of the termination of
his services and to demand that he vacate the property. Gelos refused and continued working on
the land.
On October 1, 1973, Gelos went to the Court of Agrarian Relations and asked for the fixing
of the agricultural lease rental on the property. He later withdrew the case and went to the
Ministry of Agrarian Reform, which granted his petition. For his part, Alzona filed a complaint
for illegal detainer against Gelos in the Municipal Court of Cabuyao, but this action was declared
“not proper for trial” by the Ministry of Agrarian Reform because of the existence of a tenancy
relationship between the parties. Alzona was rebuffed for the same reason when he sought the
assistance of the Ministry of Labor and later when he filed a complaint with the Court of
Agrarian Relations for a declaration of non-tenancy and damages against Gelos. On appeal to the
Office of the President, however, the complaint was declared proper for trial and so de-archived
and reinstated.
After hearing, the Regional Trial Court of San Pablo City (which had taken over the Court of
Agrarian Relations under PB 129) rendered a decision dated April 21, 1987, dismissing the
complaint. It found Gelos to be a tenant of the subject property and entitled to remain thereon as
2

such. The plaintiff was also held liable in attorney’s fees and costs.
The decision was subsequently reversed by the Court of Appeals. In its judgment
promulgated on November 25, 1988, it held that Gelos was not a tenant of the land in question
3

and ordered him to surrender it to Alzona. He was also held liable for the payment of P10,000.00
as attorney’s fees and the costs of

_____________

1
Exhibit “D.”
2
Rollo, p. 16; penned by Judge Clemente M. Soriano.
3
Ibid., p. 21; penned by Sempio-Diy, J., with Herrera and Francisco, JJ., concurring.
610
610 SUPREME COURT
REPORTS
ANNOTATED
Gelos vs. Court of Appeals
the suit.
The basic question the petitioner now raises before the Court is essentially factual and
therefore not proper in a petition for review under Rule 45 of the Rules of Court. Only questions
of law may be raised in this kind of proceeding. The settled rule is that the factual findings of the
Court of Appeals are conclusive on even this Court as long as they are supported by substantial
evidence. The petitioner has not shown that his case comes under any of those rare exceptions
when such findings may be validly reversed by this Court.
It is true that in Talavera v. Court of Appeals, we held that a factual conclusion made by the
4

trial court that a person is a tenant farmer, if it is supported by the minimum evidence demanded
by law, is final and conclusive and cannot be reversed by the appellate tribunals except for
compelling reasons. In the case at bar, however, we find with the respondent court that there was
such a compelling reason. A careful examination of the record reveals that, indeed, the trial court
misappreciated the facts when it ruled that the petitioner was a tenant of the private respondent.
The circumstance that the findings of the respondent court do not concur with those of the
trial court does not, of course, call for automatic reversal of the appellate court. Precisely the
function of the appellate court is to review and, if warranted, reverse the findings of the trial
court. Disagreement between the two courts merely calls on us to make a specially careful study
of their respective decisions to determine which of them should be preferred as more
conformable to the facts at hand.
The Court has made this careful study and will sustain the decision of the respondent court.
The contract of employment dated July 5, 1970, written in Tagalog and entitled “Kasunduan
ng Upahang Araw,” reads pertinently as follows:
1. 1.Ang Unang Panig ay siyang may-ari at nagtatangkilik ng isang lagay na lupa, sinasaka, na
tumatayo sa Nayon ng Baclaran, Cabuyao, Laguna, na siyang gagawa at sasaka sa lupa,
samantalang

_____________

4
182 SCRA 778.
611
VOL. 208, MAY 8, 611
1992
Gelos vs. Court of Appeals

1. ang Ikalawang Panig ay magiging upahan at katulong sa paggawa ng lupa.


2. 2.Ang Unang Panig ay gustong ipagpatuloy ang pagbubungkal at paggawa ng bukid na
binabanggit sa itaas at ang Ikalawang Panig ay may ibig na magpaupa sa paggawa sa halagang
P5.00 sa bawat araw, walong oras na trabaho gaya ng mga sumusunod: Patubigan ng linang;
pagpapahalabas ng mga pilapil; pagpapaaldabis sa unang araw ng pag-aararo; pagpapalinis ng
damo sa ibabaw ng pilapil; pagpapakamot (unang pagpapasuyod), pagpapahalang at
pagpapabalasaw (ikalawa’t ikatlong pagpapasuyod); isang tao sa pagsasabog ng abono una sa
pagpapantay ng linang; bago magtanim; isang tao sa pagaalaga ng dapog; upa sa isang tao ng
magbobomba ng gamot laban sa pagkapit ng mga kulisap (mayroon at wala); sa nag-we-weeder;
upa sa mga tao na maggagamas at magpapatubig ng palay; magsasapaw ng mga pilapil at iba pa.
3. 3.Ang Unang Panig at ang Ikalawang Panig ay nagkasundo na ang huli ay gagawa sa bukid ayon
sa nabanggit sa itaas bilang katulong at upahan lamang. Ang Unang Panig bukod sa sila ang
gagawa at magsasaka ay maaaring umupa ng iba pang tao manggagawa sa upahang umiiral
sang-ayon sa batas katulad ng pag-aararo, pagpapahulip, pagpapagamas, pagbobomba,
pagweweeder, pagsasabog ng abono, pagbobomba ng gamot, pagpapatubig at iba pang mga
gawain. Maaaring alisin ang Ikalawang Panig sa pagpapatrabaho sa ano mang oras ng Unang
Panig.
4. 4.Ipinatatanto ng Ikalawang Panig na siya ay hindi kasama sa bukid kundi upahan lamang na
binabayaran sa bawa’t araw ng kanyang paggawa sa bukid na nabanggit.

It is noted that the agreement provides that “ang Ikalawang Panig (meaning Gelos) ay may ibig
na magpaupa sa paggawa sa halagang P5.00 sa bawa’t araw, walong oras na trabaho” (The
Second Party desires to lease his services at the rate of P5.00 per day, eight hours of work) and
that ‘Ipinatatanto ng Ikalawang Panig na siya ay hindi kasama sa bukid kundi upahan lamang na
binabayaran sa bawa’t araw ng kanyang paggawa sa bukid na nabanggit.” (The Second Party
makes it known that he is not a farm tenant but only a hired laborer who is paid for every day of
work on the said farm.)
These stipulations clearly indicate that the parties did not enter into a tenancy agreement but
only a contract of employment. The agreement is a lease of services, not of the land in dispute.
This intention is quite consistent with the undisputed
612
612 SUPREME COURT
REPORTS
ANNOTATED
Gelos vs. Court of Appeals
fact that three days before that agreement was concluded, the former tenant of the land, Leocadio
Punongbayan, had executed an instrument in which he voluntarily surrendered his tenancy rights
to the private respondent. It also clearly demonstrates that, contrary to the petitioner’s
5

contention, Alzona intended to cultivate the land himself instead of placing it again under
tenancy.
The petitioner would now disavow the agreement, but his protestations are less than
convincing. His wife’s testimony that he is illiterate is belied by his own testimony to the
contrary in another proceeding. Her claim that they were tricked into signing the agreement does
6

not stand up against the testimony of Atty. Santos Pampolina, who declared under his oath as a
witness (and as an attorney and officer of the court) that he explained the meaning of the
document to Gelos, who even read it himself before signing it. Atty. Pampolina said the
7

agreement was not notarized because his commission as notary public was good only for Manila
and did not cover Laguna, where the document was executed. At any rate, the lack of
8

notarization did not adversely affect the veracity and effectiveness of the agreement, which,
significantly, Gelos and his wife do not deny having signed.
Gelos points to the specific tasks mentioned in the agreement and suggests that they are the
work of a tenant and not of a mere hired laborer. Not so. The work specified is not peculiar to
tenancy. What a tenant may do may also be done by a hired laborer working under the direction
of the landowner, as in the case at bar. It is not the nature of the work involved but the intention
of the parties that determines the relationship between them.
As this Court has stressed in a number of cases, “tenancy is not a purely factual relationship
9

dependent on what the alleged

______________

5
Exhibit “C.”
6
TSN, July 22, 1986, pp. 10-13.
7
TSN, January 23, 1985, pp. 13-15; 37-38.
8
Ibid., pp. 21, 32.
9
Gonzales, Jr. v. Alvarez, 182 SCRA 15; See also Magno-Adamos v. Bagasao, 162 SCRA 747; Tuazon v. CA, 118
SCRA 484.
613
VOL. 208, MAY 8, 613
1992
Gelos vs. Court of Appeals
tenant does upon the land. It is also a legal relationship. The intent of the parties, the
understanding when the farmer is installed, and as in this case, their written agreements,
provided these are complied with and are not contrary to law, are even more important.”
Gelos presented receipts for fertilizer and pesticides he allegedly bought and applied to the
10

land of the private respondent, but the latter insists that it was his brother who bought them,
being an agriculturist and in charge of the technical aspect of the farm. Moreover, the receipts do
not indicate to which particular landholding the fertilizers would be applied and, as pointed out
by the private respondent, could refer to the other parcels of land which Gelos was tenanting.
The petitioner’s payment of irrigation fees from 1980 to 1985 to the National Irrigation
Administration on the said landholding is explained by the fact that during the pendency of the
CAR case, the Agrarian Reform Office fixed a provisional leasehold rental after a preliminary
finding that Gelos was the tenant of the private respondent. As such, it was he who had to pay
the irrigation fees. Incidentally, Section 12, subpar. (r) of PD 946 provides that the Secretary’s
determination of the tenancy relationship is only preliminary and cannot be conclusive on the
lower court.
It is noteworthy that, except for the self-serving testimony of the petitioner’s wife, the records
of this case are bereft of evidence regarding the sharing of harvest between Gelos and Alzona.
No less importantly, as the Court of Appeals observed, the petitioner has not shown that he paid
rentals on the subject property from 1970 to 1973, before their dispute arose.
A tenant is defined under Section 5(a) of Republic Act No. 1199 as a person who himself and
with the aid available from within his immediate farm household cultivates the land belonging to
or possessed by another, with the latter’s consent, for purposes of production,sharing the
produce with the landholder under the share tenancy system, or paying to the landholder a
price-certain or ascertainable in produce or in money or both, under the leasehold tenancy
system.(Emphasis supplied)

______________

10
Exhibits “2” and “2-A” to “2-H.”
614
614 SUPREME COURT
REPORTS
ANNOTATED
Gelos vs. Court of Appeals
For this relationship to exist, it is necessary that: 1) the parties are the landowner and the tenant;
2) the subject is agricultural land; 3) there is consent; 4) the purpose is agricultural production; 5)
there is personal cultivation; and 6) there is sharing of harvest or payment of rental. In the
absence of any of these requisites, an occupant of a parcel of land, or a cultivator thereof, or
planter thereon, cannot qualify as a de juretenant. 11

On the other hand, the indications of an employer-employee relationship are: 1) the selection
and engagement of the employee; 2) the payment of wages; 3) the power of dismissal; and 4) the
power to control the employee’s conduct—although the latter is the most important element. 12

According to a well-known authority on the subject, tenancy relationship is distinguished


13

from farm employer-farm worker relationship in that: “In farm employer-farm worker
relationship, the lease is one of labor with the agricultural laborer as the lessor of his services and
the farm employer as the lessee thereof. In tenancy relationship, it is the landowner who is the
lessor, and the tenant the lessee of agricultural land. The agricultural worker works for the farm
employer and for his labor he receives a salary or wage regardless of whether the employer
makes a profit. On the other hand, the tenant derives his income from the agricultural produce or
harvest.”
The private respondent, instead of receiving payment of rentals or sharing in the produce of
the land, paid the petitioner lump sums for specific kinds of work on the subject lot or gave
him vales,or advance payment of his wages as laborer thereon. The petitioner’s wife claims that
Alzona made her husband sign the invoices all at one time because he allegedly needed them to
reduce his income taxes. Even assuming this to be true, we do

_____________

11
Baranda v. Baguio, 189 SCRA 194; Prudential Bank v. Hon. Filomeno Capultos, 181 SCRA 159;Caballes v.
Department of Agrarian Reform, 168 SCRA 247.
12
Deferia v. NLRC, 194 SCRA 525; Singer Sewing Machine Co. v. Hon. Drilon, 193 SCRA 270;Brotherhood Labor
Unity Movement in the Philippines v. Zamora, 147 SCRA 49.
13
Alcantara, Philippine Labor and Social Legislation Annotated, Vol. 1, 1991 Revised Edition, p. 47 citing De Los
Reyes v. Espineli, et al., 30 SCRA 574.
615
VOL. 208, MAY 8, 615
1992
Gelos vs. Court of Appeals
not think that made the said payments fictitious, especially so since the petitioner never denied
having received them.
The other issue raised by the petitioner, which is decidedly legal, is easily resolved. There
being no tenancy relationship, the contention that the private respondent’s complaint has
prescribed under Section 38 of R.A. 3844 must also fail. That section is not applicable. It must
be noted that at the very outset, Alzona rejected the petitioner’s claim of agricultural tenancy and
immediately instituted his action for unlawful detainer in accordance with Section 1, Rule 70 of
the Rules of Court. As it happened, the said case was held not proper for trial by the Ministry of
Agrarian Reform. He then resorted to other remedies just so he could recover possession of his
land and, finally, in 1979, he yielded to the jurisdiction of the defunct Court of Agrarian
Relations by filing there an action for declaration of non-tenancy. The action, which was
commenced in 1979, was within the ten-year prescriptive period provided under Article 1144 of
the Civil Code for actions based on a written contract. **

The Court quotes with approval the following acute observations made by Justice Alicia
Sempio-Diy:
It might not be amiss to state at this juncture that in deciding this case in favor of defendant, the lower
court might have been greatly influenced by the fact that defendant is a mere farmer who is almost
illiterate while plaintiff is an educated landlord, such that it had felt that it was its duty to be vigilant for
the protection of defendant’s interests. But the duty of the court to protect the weak and the
underprivileged should not be carried out to such an extent as to deny justice to the landowner whenever
truth and justice happen to be on his side. Besides, defendant’s economic position vis a vis the plaintiff
does not necessarily make him the underprivileged party in this case, for as testified by plaintiff which
defendant never denied, the small land in question was the only landholding of plaintiff when he and his
father bought the same, at which time he was just a lowly employee who did not even have a house of his
own and his father, a mere farmer, while defendant was the agricultural tenant of another piece of land
and also owns his own house, a sari sari store, and a caritela.

_______________

**
Not Article 555 as cited by the appealed decision.
616
616 SUPREME COURT
REPORTS
ANNOTATED
Gelos vs. Court of Appeals
Plaintiff also surmised that it was only after defendant had been taken into its wings by the Federation of
Free Farmers that he started claiming to be plaintiff’s agricultural tenant, presumably upon the
Federation’s instigation and advice. And we cannot discount this possibility indeed, considering that
during the early stages of the proceedings in this case, defendant even counter-proposed to plaintiff that
he would surrender the land in question to the latter if plaintiff would convey to him another piece of land
adjacent to the land in question, almost one ha. in area, that plaintiff had also acquired after buying the
land in question, showing that defendant was not as ignorant as he would want the Court to believe and
had the advice of people knowledgeable on agrarian matters.
This Court has stressed more than once that 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.
WHEREFORE, the challenged decision of the Court of Appeals is AFFIRMED and the
petition is DENIED, with costs against the petitioner. It is so ordered.
Narvasa (C.J.),Griño-Aquino, Medialdeaand Bellosillo, JJ., concur.
Decision affirmed; petition denied.
Note.—Personal cultivation by owner-lessor is still a valid ground for dispossession of a
tenant. (Baliguat vs. Court of Appeals, 142 SCRA 34.)

G.R. No. 86889. December 4, 1990. *

LUZ FARMS, petitioner, vs.THE HONORABLE SECRETARY OF THE DEPARTMENT OF


AGRARIAN REFORM, respondent.
Agrarian Law;Constitutional Law;Comprehensive Agrarian Reform Law; Statutes; In construing
constitutional provisions which are ambiguous or of doubtful meaning, the courts may consider the intent
of the framers of the Constitution.—It is generally held that, in construing constitutional provisions which
are ambiguous or of doubtful meaning, the courts may consider the debates in the constitutional
convention as throwing light on the intent of the framers of the Constitution. It is true that the intent of the
convention is not controlling by itself, but as its proceeding was preliminary to the adoption by the people
of the Constitution the understanding of the convention as to what was meant by the terms of the
constitutional provision which was the subject of the deliberation, goes a long way toward explaining the
understanding of the people when they ratified it (Aquino, Jr. v. Enrile, 59 SCRA 183 [1974]).
Same; Same; Same; Same;Section II of R.A. 6657 which includes "private agricultural lands,
devoted to commercial livestock, poultry and swine raising" in the definition of "commercial farms" is
invalid.—It is evident from the foregoing discussion that Section II of R.A. 6657 which includes "private
agricultural lands, devoted to commercial livestock, poultry and swine raising" in the definition of
"commercial farms" is invalid, to the extent that the aforecited agro-industrial activities are made to be
covered by the agrarian reform program of the State. There is simply no reason to include livestock and
poultry lands in the coverage of agrarian reform.

_______________

*
EN BANC.
52
5 SUPREME COURT
2 REPORTS
ANNOTATED
Luz Farms vs. Secretary
of the Department of
Agrarian Reform
Same; Same; Elements of Judicial Inquiry.—It has been established that this Court will assume
jurisdiction over a constitutional question only if it is shown that the essential requisites of a judicial
inquiry into such a question are first satisfied. Thus, there must be an actual case or controversy involving
a conflict of legal rights susceptible of judicial determination, the constitutional question must have been
opportunely raised by the proper party, and the resolution of the question is unavoidably necessary to the
decision of the case itself (Association of Small Landowners of the Philippines, Inc. v. Secretary of
Agrarian Reform, G.R. 78742; Acuna v. Arroyo, G.R. 79310; Pabico v. Juico, G.R. 79744; Manaay v.
Juico, G.R. 79777, 14 July 1989, 175 SCRA 343).

PETITION for prohibition to review the decision of the Secretary of the Department of Agrarian
Reform.

The facts are stated in the opinion of the Court.


Enrique M. Belo for petitioner.

PARAS, J.:

This is a petition for prohibition with prayer for restraining order and/or preliminary and
permanent injunction against the Honorable Secretary of the Department of Agrarian Reform for
acting without jurisdiction in enforcing the assailed provisions of R.A. No. 6657, otherwise
known as the Comprehensive Agrarian Reform Law of 1988 and in promulgating the Guidelines
and Procedure Implementing Production and Profit Sharing under R.A. No. 6657, insofar as the
same apply to herein petitioner, and further from performing an act in violation of the
constitutional rights of the petitioner.
As gathered from the records, the factual background of this case, is as follows:
On June 10,1988, the President of the Philippines approved R.A. No. 6657, which includes
the raising of livestock, poultry and swine in its coverage (Rollo, p. 80).
On January 2, 1989, the Secretary of Agrarian Reform promulgated the Guidelines and
Procedures Implementing Production and Profit Sharing as embodied in Sections 13 and 32 of
R.A. No. 6657 (Rollo, p. 80).
On January 9, 1989, the Secretary of Agrarian Reform promulgated its Rules and Regulations
implementing Section 11 of
53
VOL. 192, DECEMBER 53
4, 1990
Luz Farms vs. Secretary of
the Department of Agrarian
Reform
R.A. No. 6657 (Commercial Farms). (Rollo, p. 81).
Luz Farms, petitioner in this case, is a corporation engaged in the livestock and poultry
business and together with others in the same business allegedly stands to be adversely affected
by the enforcement of Section 3(b), Section 11, Section 13, Section 16(d) and 17 and Section 32
of R.A. No. 6657 otherwise known as Comprehensive Agrarian Reform Law and of the
Guidelines and Procedures Implementing Production and Profit Sharing under R.A. No. 6657
promulgated on January 2,1989 and the Rules and Regulations Implementing Section 11 thereof
as promulgated by the DAR on January 9,1989 (Rollo, pp. 2-36). Hence, this petition praying
that aforesaid laws, guidelines and rules be declared unconstitutional. Meanwhile, it is also
prayed that a writ of preliminary injunction or restraining order be issued enjoining public
respondents from enforcing the same, insofar as they are made to apply to Luz Farms and other
livestock and poultry raisers.
This Court in its Resolution dated July 4, 1989 resolved to deny, among others, Luz Farms'
prayer for the issuance of a preliminary injunction in its Manifestation dated May 26, and 31,
1989. (Rollo, p. 98).
Later, however, this Court in its Resolution dated August 24, 1989 resolved to grant said
Motion for Reconsideration regarding the injunctive relief, after the filing and approval by this
Court of an injunction bond in the amount of P100,000.00. This Court also gave due course to
the petition and required the parties to file their respective memoranda (Rollo, p. 119).
The petitioner filed its Memorandum on September 6, 1989 (Rollo, pp. 131-168).
On December 22, 1989, the Solicitor General adopted his Comment to the petition as his
Memorandum (Rollo, pp. 186187).
Luz Farms questions the following provisions of R.A. 6657, insofar as they are made to apply
to it:
1. (a)Section 3(b) which includes the "raising of livestock (and poultry)" in the definition of
"Agricultural, Agricultural Enterprise or Agricultural Activity."
2. (b)Section 11 which defines "commercial farms" as "private agricultural lands devoted to
commercial, livestock, poultry and swine

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1. raising x x x."
2. (c)Section 13 which calls upon petitioner to execute a production-sharing plan.
3. (d)Section 16(d) and 17which vest on the Department of Agrarian Reform the authority to
summarily determine the just compensation to be paid for lands covered by the Comprehensive
Agrarian Reform Law.
4. (e)Section 32 which spells out the production-sharing plan mentioned in Section 13—

"x x x (W)hereby three percent (3%) of the gross sales from the production of such lands are distributed within sixty
(60) days of the end of the fiscal year as compensation to regular and other farmworkers in such lands over and
above the compensation they currently receive: Provided, That these individuals or entities realize gross sales in
excess of five million pesos per annum unless the DAR, upon proper application, determine a lower ceiling.
In the event that the individual or entity realizes a profit, an additional ten (10%) of the net profit after tax shall
be distributed to said regular and other farmworkers within ninety (90) days of the end of the fiscal year. x x x."
The main issue in this petition is the constitutionality of Sections 3(b), 11, 13 and 32 of R.A. No.
6657 (the Comprehensive Agrarian Reform Law of 1988), insofar as the said law includes the
raising of livestock, poultry and swine in its coverage as well as the Implementing Rules and
Guidelines promulgated in accordance therewith.
The constitutional provision under consideration reads as follows:

ARTICLE XIII

xxx xxx xxx

AGRARIAN AND NATURAL RESOURCES REFORM

Section 4. The State shall, by law, undertake an agrarian reform program founded on the right of
farmers and regular farmworkers, who are landless, to own directly or collectively the lands they till or, in
the case of other farmworkers, to receive a just share of the fruits thereof. To this end, the State shall
encourage and undertake the just distribution of all agricultural lands, subject to such priorities and
reasonable retention limits as the Congress may pre-
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scribe, taking into account ecological, developmental, or equity considerations, and subject to the
payment of just compensation. In determining retention limits, the State shall respect the rights of small
landowners. The State shall further provide incentives for voluntary land-sharing.
xxx xxx xxx."
Luz Farms contended that it does not seek the nullification of R.A. 6657 in its entirety. In fact, it
acknowledges the correctness of the decision of this Court in the case of the Association of Small
Landowners in the Philippines, Inc. vs. Secretary of Agrarian Reform (G.R. 78742, 14 July
1989) affirming the constitutionality of the Comprehensive Agrarian Reform Law. It, however,
argued that Congress in enacting the said law has transcended the mandate of the Constitution, in
including land devoted to the raising of livestock, poultry and swine in its coverage (Rollo, p.
131). Livestock or poultry raising is not similar to crop or tree farming. Land is not the primary
resource in this undertaking and represents no more than five percent (5%) of the total
investment of commercial livestock and poultry raisers. Indeed, there are many owners of
residential lands all over the country who use available space in their residence for commercial
livestock and raising purposes, under "contract-growing arrangements," whereby processing
corporations and other commercial livestock and poultry raisers (Rollo, p. 10). Lands support the
buildings and other amenities attendant to the raising of animals and birds. The use of land is
incidental to but not the principal factor or consideration in productivity in this industry.
Excluding backyard raisers, about 80% of those in commercial livestock and poultry production
occupy five hectares or less. The remaining 20% are mostly corporate farms (Rollo, p. 11).
On the other hand, the public respondent argued that livestock and poultry raising is
embraced in the term "agriculture" and the inclusion of such enterprise under Section 3(b) of
R.A. 6657 is proper. He cited that Webster's International Dictionary, Second Edition (1954),
defines the following words:
"Agriculture—the art or science of cultivating the ground and raising and harvesting crops, often,
including also, feeding, breeding and management of livestock, tillage, husbandry, farming.
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It includes farming, horticulture, forestry, dairying, sugarmaking xxx.
Livestock—domestic animals used or raised on a farm, especially for profit.
Farm—a plot or tract of land devoted to the raising of domestic or other animals." (Rollo, pp. 82-83).
The petition is impressed with merit. The question raised is one of constitutional construction.
The primary task in constitutional construction is to ascertain and thereafter assure the realization
of the purpose of the framers in the adoption of the Constitution (J.M. Tuazon & Co. vs. Land
Tenure Administration, 31 SCRA 413 [1970]).
Ascertainment of the meaning of the provision of Constitution begins with the language of
the document itself. The words used in the Constitution are to be given their ordinary meaning
except where technical terms are employed in which case the significance thus attached to them
prevails (J.M. Tuazon & Co. vs. Land Tenure Administration, 31 SCRA 413 [1970]).
It is generally held that, in construing constitutional provisions which are ambiguous or of
doubtful meaning, the courts may consider the debates in the constitutional convention as
throwing light on the intent of the framers of the Constitution. It is true that the intent of the
convention is not controlling by itself, but as its proceeding was preliminary to the adoption by
the people of the Constitution the understanding of the convention as to what was meant by the
terms of the constitutional provision which was the subject of the deliberation, goes a long way
toward explaining the understanding of the people when they ratified it (Aquino, Jr. v. Enrile, 59
SCRA 183[1974]).
The transcripts of the deliberations of the Constitutional Commission of 1986 on the meaning
of the word "agricultural," clearly show that it was never the intention of the framers of the
Constitution to include livestock and poultry industry in the cove rage of the constitutionally-
mandated agrarian reform program of the Government.
The Committee adopted the definition of "agricultural land" as defined under Section 166 of
R.A. 3844, as land devoted to any growth, including but not limited to crop lands, saltbeds,
fishponds, idle and abandoned land (Record, CONCOM, August 7, 1986, Vol. III, p.11).
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The intention of the Committee is to limit the application of the word "agriculture."
Commissioner Jamir proposed to insert the word "ARABLE" to distinguish this kind of
agricultural land from such lands as commercial and industrial lands and residential properties
because all of them fall under the general classification of the word "agricultural". This proposal,
however, was not considered because the Committee contemplated that agricultural lands are
limited to arable and suitable agricultural lands and therefore, do not include commercial,
industrial and residential lands (Record, CONCOM, August 7, 1986, Vol. III, p. 30).
In the interpellation, then Commissioner Regalado (now a Supreme Court Justice), posed
several questions, among others, quoted as follows:
xxx xxx xxx
"Line 19 refers to genuine reform program founded on the primary right of farmers and farmworkers.
I wonder if it means that leasehold tenancy is thereby proscribed under this provision because it speaks of
the primary right of farmers and farmworkers to own directly or collectively the lands they till. As also
mentioned by Commissioner Tadeo, farmworkers include those who work in piggeries and poultry
projects.
I was wondering whether I am wrong in my appreciation that if somebody puts up a piggery or a
poultry project and for that purpose hires farmworkers therein, these farmworkers will automatically have
the right to own eventually, directly or ultimately or collectively, the land on which the piggeries and
poultry projects were constructed. (Record, CONCOM, August 2,1986, p. 618).
xxx xxx xxx."
The questions were answered and explained in the statement of then Commissioner Tadeo,
quoted as follows:
xxx xxx xxx
"Sa pangalawang katanungan ng Ginoo ay medyo hindi kami nagkaunawaan. Ipinaaalam ko kay
Commissioner Regalado na hindi namin inilagay ang agricultural worker sa kadahilanang kasama rito ang
piggery, poultry at livestock workers. Ang inilagay namin dito ay farm worker kaya hindi kasama ang
piggery, poultry at livestock workers (Record, CONCOM, August 2,1986, Vol. II, p. 621).
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It is evident from the foregoing discussion that Section II of R.A. 6657 which includes "private
agricultural lands devoted to commercial livestock, poultry and swine raising" in the definition
of "commercial farms" is invalid, to the extent that the aforecited agro-industrial activities are
made to be covered by the agrarian reform program of the State. There is simply no reason to
include livestock and poultry lands in the coverage of agrarian reform. (Rollo, p. 21).
Hence, there is merit in Luz Farms' argument that the requirement in Sections 13 and 32 of
R.A. 6657 directing "corporate farms" which include livestock and poultry raisers to execute and
implement "production-sharing plans" (pending final redistribution of their landholdings)
whereby they are called upon to distribute from three percent (3%) of their gross sales and ten
percent (10%) of their net profits to their workers as additional compensation is unreasonable for
being confiscatory, and therefore violative of due process (Rollo, p. 21).
It has been established that this Court will assume jurisdiction over a constitutional question
only if it is shown that the essential requisites of a judicial inquiry into such a question are first
satisfied. Thus, there must be an actual case or controversy involving a conflict of legal rights
susceptible of judicial determination, the constitutional question must have been opportunely
raised by the proper party, and the resolution of the - question is unavoidably necessary to the
decision of the case itself (Association of Small Landowners of the Philippines, Inc. v. Secretary
of Agrarian Reform, G.R. 78742; Acuna v. Arroyo, G.R. 79310; Pabico v. Juico, G.R.
79744; Manaay v. Juico, G.R. 79777, 14 July 1989, 175 SCRA 343).
However, despite the inhibitions pressing upon the Court when confronted with constitutional
issues, it will not hesitate to declare a law or act invalid when it is convinced that this must be
done. In arriving at this conclusion, its only criterion will be the Constitution and God as its
conscience gives it in the light to probe its meaning and discover its purpose. Personal motives
and political considerations are irrelevancies that cannot influence its decisions. Blandishment is
as ineffectual as intimidation, for all the awesome power of the Congress and Executive, the
Court will not hesitate "to make the hammer fall heavily," where the acts of these departments,
or of any official,
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betray the people's will as expressed in the Constitution (Association of Small Landowners of the
Philippines, Inc. v. Secretary of Agrarian Reform, G.R. 78742; Acuna v. Arroyo, G.R.
79310; Pabico v. Juico, G.R. 79744; Manaay v. Juico, G.R. 79777, 14 July 1989).
Thus, where the legislature or the executive acts beyond the scope of its constitutional
powers, it becomes the duty of the judiciary to declare what the other branches of the
government had assumed to do, as void? This is the essence of judicial power conferred by the
Constitution "(I)n one Supreme Court and in such lower courts as may be established by law"
(Art. VIII, Section 1 of the 1935 Constitution; Article X, Section I of the 1973 Constitution and
which was adopted as part of the Freedom Constitution, and Article VIII, Section 1 of the 1987
Constitution) and which power this Court has exercised in many instances (Demetria v. Alba,
148 SCRA 208 [1987]).
PREMISES CONSIDERED, the instant petition is hereby GRANTED. Sections 3(b), 11, 13
and 32 of R.A. No. 6657 insofar as the inclusion of the raising of livestock, poultry and swine in
its coverage as well as the Implementing Rules and Guidelines promulgated in accordance
therewith, are hereby DECLARED null and void for being unconstitutional and the writ of
preliminary injunction issued is hereby MADE permanent.
SO ORDERED.
Fernan (C.J.),Narvasa, Melencio-Herrera,Gutierrez,
Jr., Cruz,Gancayco, Padilla, Bidin,Griño-Aquino, Medialdeaand Regalado, JJ., concur.
Feliciano, J., On leave.
Sarmiento, J., Seeseparate opinion.
SEPARATE OPINION

SARMIENTO, J.:

I agree that the petition be granted.


It is my opinion however that the main issue on the validity of the assailed provisions of R.A.
6657 (the Comprehensive Agrarian Reform Law of 1988) and its Implementing Rules and
Guidelines insofar as they include the raising of livestock,
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poultry, and swine in their coverage can not be simplistically reduced to a question of
constitutional construction.
It is a well-settled rule that construction and interpretation come only after it has been
demonstrated that application is impossible or inadequate without them. A close reading
however of the constitutional text in point, specifically, Sec. 4, Art. XIII, particularly the phrase,
"xxx in case of other farmworkers, to receive a just share of the fruits thereof," provides a basis
for the clear and possible coverage of livestock, poultry, and swine raising within the ambit of
the comprehensive agrarian reform program. This accords with the principle that every
presumption should be indulged in favor of the constitutionality of a statute and the court in
considering the validity of a statute should give it such reasonable construction as can be reached
to bring it within the fundamental law. 1

The presumption against unconstitutionality, I must say, assumes greater weight when a
ruling to the contrary would, in effect, defeat the laudable and noble purpose of the law, i.e., the
welfare of the landless farmers and farmworkers in the promotion of social justice, by the
expedient conversion of agricultural lands into livestock, poultry, and swine raising by scheming
landowners, thus, rendering the comprehensive nature of the agrarian program merely illusory.
The instant controversy, I submit, boils down to the question of whether or not the assailed
provisions violate the equal protection clause of the Constitution (Article II, section 1) which
teaches simply that all persons or things similarly situated should be treated alike, both as to
rights conferred and responsibilities imposed. 2

There is merit in the contention of the petitioner that substantial distinctions exist between
land directed purely to cultivation and harvesting of fruits or crops and land exclusively used for
livestock, poultry and swine raising, that make real differences, to wit:

_______________

1
In re Guarina, 24 Phil. 37; Yu Cong Eng v. Trinidad, 70 L. ed., p. 1059.
2
Ichong v. Hernandez, 101 Phil. 1155.
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xxx xxx xxx
No land is tilled and no crop is harvested in livestock and poultry farming. There are no tenants nor
landlords, only employers and employees.
Livestock and poultry do not sprout from land nor are they "fruits of the land."
Land is not even a primary resource in this industry. The land input is inconsequential that all the
commercial hog and poultry farms combined occupy less than one percent (1%) (0.4% for piggery, 0.2%
for poultry) of the 5.45 million hectares of land supposedly covered by the CARP. And most farms utilize
only 2 to 5 hectares of land.
In every respect livestock and poultry production is an industrial activity. Its use of an inconsequential
portion of land is a mere incident of its operation, as in any other undertaking, business or otherwise.
The fallacy of defining livestock and poultry production as an agricultural enterprise is nowhere more
evident when one considers that at least 95% of total investment in these farms is in the form of fixed
assets which are industrial in nature.
These include (1) animal housing structures and facilities complete with drainage, waterers, blowers,
misters and in some cases even piped-in music; (2) feedmills complete with grinders, mixers, conveyors,
exhausts, generators, etc.; (3) extensive warehousing facilities for feeds and other supplies; (4) anti-
pollution equipment such as bio-gas and digester plants augmented by lagoons and concrete ponds; (5)
deepwells, elevated water tanks, pumphouses and accessory facilities; (6) modern equipment such as
sprayers, pregnancy testers, etc.; (7) laboratory facilities complete with expensive tools and equipment;
and a myriad other such technologically advanced appurtances.
How then can livestock and poultry farmlands be arable when such are almost totally occupied by
these structures?
The fallacy of equating the status of livestock and poultry farmworkers with that of agricultural
tenants surfaces when one considers contribution to output. Labor cost of livestock and poultry farms is
no more than 4% of total operating cost. The 96% balance represents inputs not obtained from the land
nor provided by the farmworkers—inputs such as feeds and biochemicals (80% of the total cost), power
cost, cost of money and several others.
Moreover, livestock and poultry farmworkers are covered by minimum wage law rather than by
tenancy law. They are entitled to social security benefits where tenant-farmers are not. They are paid
fixed wages rather than crop shares. And as in any other industry, they receive additional benefits such as
allowances, bonuses, and other
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incentives such as free housing privileges, light and water. Equating livestock and poultry farming with
other agricultural activities is also fallacious in the sense that like the manufacturing sector, it is a market
for, rather than a source of agricultural output. At least 60% of the entire domestic supply of corn is
absorbed by livestock and poultry farms. So are the by-products of rice (rice-bran), coconut (copra meal),
banana (banana pulp meal), and fish (fish meal). 3

xxx xxx xxx


In view of the foregoing, it is clear that both kinds of lands are not similarly situated and hence,
can not be treated alike. Therefore, the assailed provisions which allow for the inclusion of
livestock and poultry industry within the coverage of the agrarian reform program constitute
invalid classification and must accordingly be. struck down as repugnant to the equal protection
clause of the Constitution.
Petition granted.
Notes.—The manner and content of the just compensation provided in the CARP is not
violative of the Constitution. (Association of Small Landowners in the Phil. Inc. vs. Sec. of
Agrarian Reform, 175 SCRA 343).
Tenancy relations cannot be bargained away except for strong reasons. These must be proved
by competent evidence. (Talavera vs. Court of Appeals, 182 SCRA 778).