Fortich vs. Corona (G.R. No.

131457) Facts: - This case involves a 144-hectare land located at San Vicente, Sumilao, Bukidnon, owned by the Norberto Quisumbing, Sr. Management and Development Corporation (NQSRMDC), one of the petitioners. - In 1984, the land was leased as a pineapple plantation to the Philippine Packing Corporation, now Del Monte Philippines, Inc. (DMPI) for a period of ten (10) years. The lease expired in April, 1994. - During the existence of the lease, the Department of Agrarian Reform (DAR) placed the entire 144hectare property under compulsory acquisition and assessed the land value at P2.38 million. - NQSRMDC sought and was granted by the DAR Adjudication Board (DARAB), through its Provincial Agrarian Reform Adjudicator (PARAD) a writ of prohibition with preliminary injunction which ordered the DAR Region X Director, the Provincial Agrarian Reform Officer (PARO) of Bukidnon, the Municipal Agrarian Reform Office (MARO) of Sumilao, Bukidnon, the Land Bank of the Philippines (Land Bank), and their authorized representatives "to desist from pursuing any activity or activities" concerning the subject land "until further orders." - Despite the DARAB order of March 31, 1992, the DAR Regional Director issued a memorandum directing the Land Bank to open a trust account for P2.38 million in the name of NQSRMDC and to conduct summary proceedings to determine the just compensation of the subject property. NQSRMDC objected to these moves and filed an Omnibus Motion to enforce the DARAB order of March 31, 1992 and to nullify the summary proceedings undertaken by the DAR Regional Director and Land Bank on the valuation of the subject property. - DARAB acted favorably on the Omnibus Motion. Land Bank complied with the DARAB. - In the meantime, the Provincial Development Council (PDC) of Bukidnon, headed by Governor Carlos O. Fortich, passed Resolution No. 6, 8 dated January 7, 1993, designating certain areas along Bukidnon-Sayre Highway as part of the Bukidnon Agro-Industrial Zones where the subject property is situated. - Pursuant to Section 20 of R.A. No. 7160, otherwise known as the Local Government Code, the Sangguniang Bayan of Sumilao, Bukidnon, on March 4, 1993, enacted Ordinance No. 24 converting or reclassifying 144 hectares of land in Bgy. San Vicente, said Municipality, from agricultural to industrial/institutional with a view of providing an

opportunity to attract investors who can inject new economic vitality, provide more jobs and raise the income of its people. - Under said section, 4th to 5th class municipalities may authorize the classification of five percent (5%) of their agricultural land area and provide for the manner of their utilization or disposition. - On 11 December 1993, the instant application for conversion was filed by Mr. Gaudencio Beduya in behalf of NQSRMDC/BAIDA (Bukidnon Agro-Industrial Development Association). This was favorably recommended by a lot government officials. The people of the affected barangay even rallied behind their respective officials in endorsing the project. - Notwithstanding the foregoing favorable recommendation, however, on November 14, 1994, the DAR, thru Secretary Garilao, invoking its powers to approve conversion of lands under Section 65 of R.A. No. 6657, issued an Order denying the instant application for the conversion of the subject land from agricultural to agro-industrial and, instead, placed the same under the compulsory coverage of CARP and directed the distribution thereof to all qualified beneficiaries. - Motion for Reconsideration of the aforesaid Order was filed by applicant but the same was denied. Thus, the DAR Secretary ordered the DAR Regional Director "to proceed with the compulsory acquisition and distribution of the property." - Governor Carlos O. Fortich of Bukidnon appealed" the order of denial to the Office of the President and prayed for the conversion/reclassification of the subject land as the same would be more beneficial to the people of Bukidnon. - NQSRMDC filed with the Court of Appeals a petition for certiorari, prohibition with preliminary injunction. - Meanwhile, on July 25, 1995, the Honorable Paul G. Dominguez, then Presidential Assistant for Mindanao, after conducting an evaluation of the proposed project, sent a memorandum to the President favorably endorsing the project with a recommendation that the DAR Secretary reconsider his decision in denying the application of the province for the conversion of the land. - On October 23, 1995, the Court of Appeals issued a Resolution ordering the parties to observe status quo pending resolution of the petition. - In resolving the appeal, the Office of the President, through then Executive Secretary Ruben D. Torres, issued a Decision in OP Case No. 96-C-6424, dated March 29, 1996, reversing the DAR Secretary's decision. It stated that: deciding in favor of NQSRMDC, the DARAB correctly pointed out that

under Section 8 of R.A. No. 6657, the subject property could not validly be the subject of compulsory acquisition until after the expiration of the lease contract with Del Monte Philippines, a Multi-National Company, or until April 1994. xxx the language of Section 20 of R.A. No. 7160, supra, is clear and affords no room for any other interpretation. By unequivocal legal mandate, it grants local government units autonomy in their local affairs including the power to convert portions of their agricultural lands and provide for the manner of their utilization and disposition to enable them to attain their fullest development as self-reliant communities. - On September 11, 1996, in compliance with the OP decision of March 29, 1996, NQSRMDC and the Department of Education, Culture and Sports (DECS) executed a Memorandum of Agreement whereby the former donated four (4) hectares from the subject land to DECS for the establishment of the NQSR High School. - When NQSRMDC was about to transfer the title over the 4-hectare donated to DECS, it discovered that the title over the subject property was no longer in its name. It soon found out that during the pendency of both the Petition for Certiorari, Prohibition, with Preliminary Injunction it filed against DAR in the Court of Appeals and the appeal to the President filed by Governor Carlos O. Fortich, the DAR, without giving just compensation, caused the cancellation of NQSRMDC's title on August 11, 1995 and had it transferred in the name of the Republic of the Philippines. On September 25, 1995, DAR caused the issuance of Certificates of Land Ownership Award (CLOA) No. 00240227 and had it registered in the name of 137 farmer-beneficiaries. - On April 10, 1997, NQSRMDC filed a complaint 21 with the Regional Trial Court (RTC) of Malaybalay, Bukidnon for annulment and cancellation of title, damages and injunction against DAR and 141 others. RTC then issued a Temporary Restraining Order and a Writ of Preliminary Injunction restraining the DAR and 141 others from entering, occupying and/or wresting from NQSRMDC the possession of the subject land. - On August 12, 1997, the said writ of preliminary injunction issued by the RTC was challenged by some alleged farmers before the Court of Appeals through a petition for certiorari and prohibition praying for the lifting of the injunction and for the issuance of a writ of prohibition from further trying the RTC case. - On October 9, 1997, some alleged farmerbeneficiaries began their hunger strike in front of the DAR Compound in Quezon City to protest the OP Decision of March 29, 1996. - On November 7, 1997, the Office of the President resolved the strikers' protest by issuing the so-called

"Win/Win" Resolution penned by then Deputy Executive Secretary Renato C. Corona which modified the decision of the Office of the President, through Executive Secretary Ruben Torres, dated March 29, 1996: NQSRMDC's application for conversion is APPROVED only with respect to the approximately forty-four (44) hectare portion of the land adjacent to the highway. remaining approximately one hundred (100) hectares traversed by an irrigation canal and found to be suitable for agriculture shall be distributed to qualified farmer-beneficiaries in accordance with RA 6657 or the Comprehensive Agrarian Reform Law with a right of way to said portion from the highway provided in the portion fronting the highway.

- A copy of the "Win-Win" Resolution was received by Governor Carlos O. Fortich of Bukidnon, Mayor Rey B. Baula of Sumilao, Bukidnon, and NQSRMDC on November 24, 1997 and, on December 4, 1997, they filed the present petition for certiorari, prohibition and injunction with urgent prayer for a temporary restraining order and/or writ of preliminary injunction against then Deputy Executive Secretary Renato C. Corona and DAR Secretary Ernesto D. Garilao. - Respondents, through the Solicitor General, opposed the petition and prayed that it be dismissed outright. [long discussion on rules of procedure] Issues:

1.

2.

Whether or not the power of the local government units to reclassify lands is subject to the approval of the Department of Agrarian Reform (DAR). Whether the final and executory Decision dated March 29, 1996 can still be substantially modified by the "Win-Win" Resolution was ruled upon by the SC in the negative.

Held: 1st issue: (as was stated in the OP Decision) Local Government Units need not obtain the approval of the DAR to convert or reclassify lands from agricultural to non-agricultural use. It should be stressed that when the March 29, 1996 OP Decision was declared final and executory, vested rights were acquired by the herein petitioners, namely, the province of Bukidnon, the municipality of Sumilao, Bukidnon, and the NQSR Management and Development Corporations, and all others who should be benefited by the said decision. The issue here is not a question of technicality but that of

substance and merit. Whether the Sangguniang Bayan of Sumilao has the legal authority to reclassify the land into industrial/institutional use, the March 29, 1996 OP Decision has thoroughly and properly disposed the issue. Converting the land in question from agricultural to agro-industrial would open great opportunities for employment and bring about real development in the area towards a sustained economic growth of the municipality. Procedural lapses in the manner of identifying/reclassifying the subject property for agro-industrial purposes cannot be allowed to defeat the very purpose of the law granting autonomy to local government units in the management of their local affairs. Stated more simply, the language of Section 20 of R.A. No. 7160 is clear and affords no room for any other interpretation. By unequivocal legal mandate, it grants local governments units autonomy in their local affairs including the power to convert portions of their agricultural lands and provide for the manner of their utilization and disposition to enable them to attain their fullest development as self-reliant communities. 2nd issue: When the Office of the President issued the Order dated June 23, 1997 declaring the Decision of March 29, 1996 final and executory, as no one has seasonably filed a motion for reconsideration thereto, the said Office had lost its jurisdiction to re-open the case, more so modify its Decision. Having lost its jurisdiction, the Office of the President has no more authority to entertain the second motion for reconsideration filed by respondent DAR Secretary, which second motion became the basis of the assailed "Win-Win" Resolution. The assailed "Win-Win" Resolution which substantially modified the Decision of March 29, 1996 after it has attained finality, is utterly void.