MMDA v Bel-Air Village Association, Inc.

GR 135962
March 27, 2000
FACTS:
On December 30, 1995, respondent received from petitioner a notice requesting the former to open its private
road, Neptune Street, to public vehicular traffic starting January 2, 1996. On the same day, respondent was
apprised that the perimeter separating the subdivision from Kalayaan Avenue would be demolished.
Respondent instituted a petition for injunction against petitioner, praying for the issuance of a TRO and
preliminary injunction enjoining the opening of Neptune Street and prohibiting the demolition of the perimeter
wall.
ISSUE:
WON MMDA has the authority to open Neptune Street to public traffic as an agent of the state endowed with
police power.
HELD:
A local government is a political subdivision of a nation or state which is constituted by law and has
substantial control of local affairs. It is a body politic and corporate one endowed with powers as a political
subdivision of the National Government and as a corporate entity representing the inhabitants of its territory
(LGC of 1991).
Our Congress delegated police power to the LGUs in Sec.16 of the LGC of 1991. It empowers the
sangguniang panlalawigan, panlungsod and bayan to enact ordinances, approve resolutions and appropriate
funds for the general welfare of the [province, city or municipality] and its inhabitants pursuant to Sec.16 of the
Code and in the proper exercise of the [LGUs corporate powers] provided under the Code.
There is no syllable in RA 7924 that grants the MMDA police power, let alone legislative power. Unlike the
legislative bodies of the LGUs, there is no grant of authority in RA 7924 that allows the MMDA to enact
ordinances and regulations for the general welfare of the inhabitants of Metro Manila. The MMDA is merely a
development authority and not a political unit of government since it is neither an LGU or a public corporation
endowed with legislative power. The MMDA Chairman is not an elective official, but is merely appointed by the
President with the rank and privileges of a cabinet member.
In sum, the MMDA has no power to enact ordinances for the welfare of the community. It is the LGUs, acting
through their respective legislative councils, that possess legislative power and police power.
The Sangguniang Panlungsod of Makati City did not pass any ordinance or resolution ordering the opening of
Neptune Street, hence, its proposed opening by the MMDA is illegal.
Expressium facit cessare tacitum
"What is expressed puts an end to that which is implied." If only we say what we mean to say then at least the
earth would be a bit of a better place. If we say everything there would be no assumptions because
assumptions are mostly never even thought of and mostly the cause of all troubles ;) never assume. :) just
saying...
Friday, November 9, 2012
MMDA v. Bel-Air Village Association, 328 SCRA 836, GR 135962 (2000)
1.
MMDA v. Bel-Air Village Association, 328 SCRA 836, GR 135962 (2000)
Facts:
Metropolitan Manila Authority (MMDA) is a government agency tasked with the delivery of basic services in
Metro Manila, while Bel-Air Village Association, Inc. (BAVA) is the registered owner of Neptune Street, a road
inside a private residential subdivision, the Bel-Air Village. On December 30, 1995, the president of the
respondent received from the chairman of MMDA a notice requesting the respondent to open Neptune Street
to public vehicular traffic starting January 2, 1996. On that same day, the president of the respondent was
apprised that the perimeter wall separating the subdivision from the adjacent Kalayaan Avenue would be

demolished. On January 2, 1996, the respondent instituted an action for injunction against the petitioner before
the Regional Trial Court. The trial court issued a temporary restraining order. However, after due hearing, the
court denied the issuance of a preliminary injunction. On appeal, the Court of Appeals ruled that the MMDA has
no authority to order the opening of Neptune Street being a private subdivision road and to cause the
demolition of its perimeter walls. It held that the authority is lodged in the City Council of Makati by an
ordinance.
Issue/s:
1. WON MMDA has the right to order the opening of Neptune and to cause the demolition of its perimeter
walls.
Held: The Court ruled that the MMDA has no power to enact ordinances for the welfare of the community. It is
the local government units, acting through their respective legislative councils, that possess legislative power
and police power. In the case at bar, the Sangguniang Panlunsod of Makati City did not pass any ordinance or
resolution ordering the opening of Neptune Street, hence, its proposed opening by petitioner MMDA is illegal
and the respondent Court of Appeals did not err in so ruling.
Moreover, the MMDA was created to put some order in the metropolitan transportation system, but
unfortunately the powers granted by its charter are limited. Its good intentions cannot justify the opening for
public use of a private street in a private subdivision without any legal warrant. The promotion of the general
welfare is not antithetical to the preservation of the rule of law.
keith colle at 5:41 AM
Police power vs. eminent domain
In the recent case of THE OFFICE OF THE SOLICITOR GENERAL vs. AYALA LAND INCORPORATED,
ROBINSONS LAND CORPORATION, SHANGRI-LA PLAZA CORPORATION and SM PRIME HOLDINGS,
INC., G.R. No. 177056, September 18, 2009, G.R. No. 177056, September 18, 2009, which involved the issue
of whether or not private shopping malls could be compelled by law to offer free parking spaces to their
customers, the Philippine Supreme Court, inter alia, rejected the assertion of the government that under the
doctrine of police power private shopping malls could be so compelled by the state to provide free parking
spaces to their customers.
The case distinguishes the natures and legal effects of police power and eminent domain.
By way of review, it will be noted that in Senate Committee Report No. 225 on 2 May 2000, the Senate
concluded that the collection of parking fees by shopping malls was contrary to the National Building Code.
While it is true that the Code merely requires malls to provide parking spaces, without specifying whether it is
free or not, the Senate Committees believed that the reasonable and logical interpretation of the Code was that
the parking spaces were for free.
Article II of R.A. No. 9734 (Consumer Act of the Philippines) provides that it is the policy of the State to protect
the interest of the consumers, promote the general welfare and establish standards of conduct for business
and industry. Obviously, a contrary interpretation (i.e., justifying the collection of parking fees) would be going
against the declared policy of R.A. 7394, the Report said.
Section 201 of the National Building Code gives the responsibility for the administration and enforcement of the
provisions of the Code, including the imposition of penalties for administrative violations thereof to the
Secretary of Public Works, the Report added.
The Senate Committee Report recommended that the Office of the Solicitor General institute the necessary
action to enjoin the collection of parking fees as well as to enforce the penal sanction provisions of the National
Building Code and that the Office of the Solicitor General should likewise study how refund could be exacted
from mall owners who continue to collect parking fees.
The Report recommended that the Department of Trade and Industry pursuant to the provisions of R.A. No.
7394, otherwise known as the Consumer Act of the Philippines should enforce the provisions of the Code
relative to parking, that the DTI should formulate the necessary implementing rules and regulations on parking

in shopping malls, with prior consultations with the local government units where these are located, and that
the DTI, in coordination with the Department of Public Works and Highways (DPWH), should be empowered to
regulate and supervise the construction and maintenance of parking establishments. Finally, the Report
recommended that Congress should amend and update the National Building Code to expressly prohibit
shopping malls from collecting parking fees by at the same time, prohibit them from invoking the waiver of
liability.
Suits were filed by the shopping malls under Rule 63 (declaratory relief) seeking to judicially declaring Rule XIX
of the Implementing Rules and Regulations of the National Building Code as ultra vires, hence, unconstitutional
and void; declaring the malls clear legal right to lease parking spaces; declaring the National Building Code of
the Philippines Implementing Rules and Regulations as ineffective, not having been published once a week for
three (3) consecutive weeks in a newspaper of general circulation, as prescribed by Section 211 of Presidential
Decree No. 1096.
A similar suit was filed by the Office of the Solicitor General (OSG) praying that aAfter summary hearing, a
temporary restraining order and a writ of preliminary injunction be issued restraining the malls from collecting
parking fees from their customers; and after hearing, judgment be rendered declaring that the practice of
respondents in charging parking fees is violative of the National Building Code and its Implementing Rules and
Regulations and is therefore invalid, and making permanent any injunctive writ issued in the case.
The trial court and the appellate court sided with the private malls.
Let me digest the doctrinal pronouncements of the Supreme Court in the said case.
1. According to Section 803 of the National Building Code:
SECTION 803. Percentage of Site Occupancy
(a) Maximum site occupancy shall be governed by the use, type of construction, and height of the building and
the use, area, nature, and location of the site; and subject to the provisions of the local zoning requirements
and in accordance with the rules and regulations promulgated by the Secretary.
2. In connection therewith, Rule XIX of the old IRR, provides:
RULE XIX PARKING AND LOADING SPACE REQUIREMENTS
Pursuant to Section 803 of the National Building Code (PD 1096) providing for maximum site occupancy, the
following provisions on parking and loading space requirements shall be observed:
1. The parking space ratings listed below are minimum off-street requirements for specific uses/occupancies
for buildings/structures:
1.1 The size of an average automobile parking slot shall be computed as 2.4 meters by 5.00 meters for
perpendicular or diagonal parking, 2.00 meters by 6.00 meters for parallel parking. A truck or bus
parking/loading slot shall be computed at a minimum of 3.60 meters by 12.00 meters. The parking slot shall be
drawn to scale and the total number of which shall be indicated on the plans and specified whether or not
parking accommodations, are attendant-managed. (See Section 2 for computation of parking requirements).
xxxx
1.7 Neighborhood shopping center 1 slot/100 sq. m. of shopping floor area
3. The explicit directive of the afore-quoted statutory and regulatory provisions, garnered from a plain reading
thereof, is that respondents, as operators/lessors of neighborhood shopping centers, should provide parking
and loading spaces, in accordance with the minimum ratio of one slot per 100 square meters of shopping floor

area. There is nothing therein pertaining to the collection (or non-collection) of parking fees by respondents. In
fact, the term parking fees cannot even be found at all in the entire National Building Code and its IRR.
4. Statutory construction has it that if a statute is clear and unequivocal, it must be given its literal meaning and
applied without any attempt at interpretation. Since Section 803 of the National Building Code and Rule XIX of
its IRR do not mention parking fees, then simply, said provisions do not regulate the collection of the same.
The RTC and the Court of Appeals correctly applied Article 1158 of the New Civil Code, which states:
Art. 1158. Obligations derived from law are not presumed. Only those expressly determined in this Code or in
special laws are demandable, and shall be regulated by the precepts of the law which establishes them; and
as to what has not been foreseen, by the provisions of this Book. (Emphasis ours.)
Hence, in order to bring the matter of parking fees within the ambit of the National Building Code and its IRR,
the OSG had to resort to specious and feeble argumentation, in which the Court cannot concur.
5. Consequently, the OSG cannot claim that in addition to fixing the minimum requirements for parking spaces
for buildings, Rule XIX of the IRR also mandates that such parking spaces be provided by building owners free
of charge. If Rule XIX is not covered by the enabling law, then it cannot be added to or included in the
implementing rules. The rule-making power of administrative agencies must be confined to details for
regulating the mode or proceedings to carry into effect the law as it has been enacted, and it cannot be
extended to amend or expand the statutory requirements or to embrace matters not covered by the statute.
Administrative regulations must always be in harmony with the provisions of the law because any resulting
discrepancy between the two will always be resolved in favor of the basic law.
6. It is not sufficient for the OSG to claim that the power to regulate and control the use, occupancy, and
maintenance of buildings and structures carries with it the power to impose fees and, conversely, to control,
partially or, as in this case, absolutely, the imposition of such fees. Firstly, the fees within the power of
regulatory agencies to impose are regulatory fees. It has been settled law in this jurisdiction that this broad and
all-compassing governmental competence to restrict rights of liberty and property carries with it the undeniable
power to collect a regulatory fee. It looks to the enactment of specific measures that govern the relations not
only as between individuals but also as between private parties and the political society. True, if the regulatory
agencies have the power to impose regulatory fees, then conversely, they also have the power to remove the
same. Even so, it is worthy to note that the present case does not involve the imposition by the DPWH
Secretary and local building officials of regulatory fees upon respondents; but the collection by respondents of
parking fees from persons who use the mall parking facilities. Secondly, assuming arguendo that the DPWH
Secretary and local building officials do have regulatory powers over the collection of parking fees for the use
of privately owned parking facilities, they cannot allow or prohibit such collection arbitrarily or whimsically.
Whether allowing or prohibiting the collection of such parking fees, the action of the DPWH Secretary and local
building officials must pass the test of classic reasonableness and propriety of the measures or means in the
promotion of the ends sought to be accomplished.
7. Keeping in mind the aforementioned test of reasonableness and propriety of measures or means, the Court
notes that Section 803 of the National Building Code falls under Chapter 8 on Light and Ventilation. Evidently,
the Code deems it necessary to regulate site occupancy to ensure that there is proper lighting and ventilation
in every building. Pursuant thereto, Rule XIX of the IRR requires that a building, depending on its specific use
and/or floor area, should provide a minimum number of parking spaces. The Court, however, fails to see the
connection between regulating site occupancy to ensure proper light and ventilation in every building vis--vis
regulating the collection by building owners of fees for the use of their parking spaces. Contrary to the
averment of the OSG, the former does not necessarily include or imply the latter. It totally escapes this Court
how lighting and ventilation conditions at the malls could be affected by the fact that parking facilities thereat
are free or paid for.
8. X x x. The National Building Code regulates buildings, by setting the minimum specifications and
requirements for the same. It does not concern itself with traffic congestion in areas surrounding the building. It
is already a stretch to say that the National Building Code and its IRR also intend to solve the problem of traffic
congestion around the buildings so as to ensure that the said buildings shall have adequate lighting and

ventilation. Moreover, the Court cannot simply assume, as the OSG has apparently done, that the traffic
congestion in areas around the malls is due to the fact that respondents charge for their parking facilities, thus,
forcing vehicle owners to just park in the streets. The Court notes that despite the fees charged by
respondents, vehicle owners still use the mall parking facilities, which are even fully occupied on some days.
Vehicle owners may be parking in the streets only because there are not enough parking spaces in the malls,
and not because they are deterred by the parking fees charged by respondents. Free parking spaces at the
malls may even have the opposite effect from what the OSG envisioned: more people may be encouraged by
the free parking to bring their own vehicles, instead of taking public transport, to the malls; as a result, the
parking facilities would become full sooner, leaving more vehicles without parking spaces in the malls and
parked in the streets instead, causing even more traffic congestion.
9. Without using the term outright, the OSG is actually invoking police power to justify the regulation by the
State, through the DPWH Secretary and local building officials, of privately owned parking facilities, including
the collection by the owners/operators of such facilities of parking fees from the public for the use thereof. The
Court finds, however, that in totally prohibiting respondents from collecting parking fees from the public for the
use of the mall parking facilities, the State would be acting beyond the bounds of police power.
10. Police power is the power of promoting the public welfare by restraining and regulating the use of liberty
and property. It is usually exerted in order to merely regulate the use and enjoyment of the property of the
owner. The power to regulate, however, does not include the power to prohibit. A fortiori, the power to regulate
does not include the power to confiscate. Police power does not involve the taking or confiscation of property,
with the exception of a few cases where there is a necessity to confiscate private property in order to destroy it
for the purpose of protecting peace and order and of promoting the general welfare; for instance, the
confiscation of an illegally possessed article, such as opium and firearms.
11. When there is a taking or confiscation of private property for public use, the State is no longer exercising
police power, but another of its inherent powers, namely, eminent domain. Eminent domain enables the State
to forcibly acquire private lands intended for public use upon payment of just compensation to the owner.
12. Normally, of course, the power of eminent domain results in the taking or appropriation of title to, and
possession of, the expropriated property; but no cogent reason appears why the said power may not be
availed of only to impose a burden upon the owner of condemned property, without loss of title and
possession. It is a settled rule that neither acquisition of title nor total destruction of value is essential to taking.
It is usually in cases where title remains with the private owner that inquiry should be made to determine
whether the impairment of a property is merely regulated or amounts to a compensable taking. A regulation
that deprives any person of the profitable use of his property constitutes a taking and entitles him to
compensation, unless the invasion of rights is so slight as to permit the regulation to be justified under the
police power. Similarly, a police regulation that unreasonably restricts the right to use business property for
business purposes amounts to a taking of private property, and the owner may recover therefor.
13. Although in the present case, title to and/or possession of the parking facilities remain/s with respondents,
the prohibition against their collection of parking fees from the public, for the use of said facilities, is already
tantamount to a taking or confiscation of their properties. The State is not only requiring that respondents
devote a portion of the latters properties for use as parking spaces, but is also mandating that they give the
public access to said parking spaces for free. Such is already an excessive intrusion into the property rights of
respondents. Not only are they being deprived of the right to use a portion of their properties as they wish, they
are further prohibited from profiting from its use or even just recovering therefrom the expenses for the
maintenance and operation of the required parking facilities.
14. In conclusion, the total prohibition against the collection by respondents of parking fees from persons who
use the mall parking facilities has no basis in the National Building Code or its IRR. The State also cannot
impose the same prohibition by generally invoking police power, since said prohibition amounts to a taking of
respondents property without payment of just compensation.
Philippine Laws and Cases - Atty. Manuel J. Laserna Jr. at 1:31 PM
Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. 78742
July 14, 1989
ASSOCIATION OF SMALL LANDOWNERS IN THE PHILIPPINES, INC., JUANITO D. GOMEZ, GERARDO B.
ALARCIO, FELIPE A. GUICO, JR., BERNARDO M. ALMONTE, CANUTO RAMIR B. CABRITO, ISIDRO T.
GUICO, FELISA I. LLAMIDO, FAUSTO J. SALVA, REYNALDO G. ESTRADA, FELISA C. BAUTISTA,
ESMENIA J. CABE, TEODORO B. MADRIAGA, AUREA J. PRESTOSA, EMERENCIANA J. ISLA, FELICISIMA
C. ARRESTO, CONSUELO M. MORALES, BENJAMIN R. SEGISMUNDO, CIRILA A. JOSE & NAPOLEON S.
FERRER, petitioners,
vs.
HONORABLE SECRETARY OF AGRARIAN REFORM, respondent.
G.R. No. 79310
July 14, 1989
ARSENIO AL. ACUNA, NEWTON JISON, VICTORINO FERRARIS, DENNIS JEREZA, HERMINIGILDO
GUSTILO, PAULINO D. TOLENTINO and PLANTERS' COMMITTEE, INC., Victorias Mill District, Victorias,
Negros Occidental, petitioners,
vs.
JOKER ARROYO, PHILIP E. JUICO and PRESIDENTIAL AGRARIAN REFORM COUNCIL, respondents.
G.R. No. 79744 July 14, 1989
INOCENTES PABICO, petitioner,
vs.
HON. PHILIP E. JUICO, SECRETARY OF THE DEPARTMENT OF AGRARIAN REFORM, HON. JOKER
ARROYO, EXECUTIVE SECRETARY OF THE OFFICE OF THE PRESIDENT, and Messrs. SALVADOR
TALENTO, JAIME ABOGADO, CONRADO AVANCENA and ROBERTO TAAY, respondents.
G.R. No. 79777 July 14, 1989
NICOLAS S. MANAAY and AGUSTIN HERMANO, JR., petitioners,
vs.
HON. PHILIP ELLA JUICO, as Secretary of Agrarian Reform, and LAND BANK OF THE PHILIPPINES,
respondents.
CRUZ, J.:
In ancient mythology, Antaeus was a terrible giant who blocked and challenged Hercules for his life on his way
to Mycenae after performing his eleventh labor. The two wrestled mightily and Hercules flung his adversary to
the ground thinking him dead, but Antaeus rose even stronger to resume their struggle. This happened several
times to Hercules' increasing amazement. Finally, as they continued grappling, it dawned on Hercules that
Antaeus was the son of Gaea and could never die as long as any part of his body was touching his Mother
Earth. Thus forewarned, Hercules then held Antaeus up in the air, beyond the reach of the sustaining soil, and
crushed him to death.
Mother Earth. The sustaining soil. The giver of life, without whose invigorating touch even the powerful Antaeus
weakened and died.
The cases before us are not as fanciful as the foregoing tale. But they also tell of the elemental forces of life
and death, of men and women who, like Antaeus need the sustaining strength of the precious earth to stay
alive.
"Land for the Landless" is a slogan that underscores the acute imbalance in the distribution of this precious
resource among our people. But it is more than a slogan. Through the brooding centuries, it has become a
battle-cry dramatizing the increasingly urgent demand of the dispossessed among us for a plot of earth as their
place in the sun.
Recognizing this need, the Constitution in 1935 mandated the policy of social justice to "insure the well-being
and economic security of all the people," 1 especially the less privileged. In 1973, the new Constitution affirmed
this goal adding specifically that "the State shall regulate the acquisition, ownership, use, enjoyment and
disposition of private property and equitably diffuse property ownership and profits." 2 Significantly, there was
also the specific injunction to "formulate and implement an agrarian reform program aimed at emancipating the
tenant from the bondage of the soil." 3
The Constitution of 1987 was not to be outdone. Besides echoing these sentiments, it also adopted one whole
and separate Article XIII on Social Justice and Human Rights, containing grandiose but undoubtedly sincere

provisions for the uplift of the common people. These include a call in the following words for the adoption by
the State of an agrarian reform program:
SEC. 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 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.
Earlier, in fact, R.A. No. 3844, otherwise known as the Agricultural Land Reform Code, had already been
enacted by the Congress of the Philippines on August 8, 1963, in line with the above-stated principles. This
was substantially superseded almost a decade later by P.D. No. 27, which was promulgated on October 21,
1972, along with martial law, to provide for the compulsory acquisition of private lands for distribution among
tenant-farmers and to specify maximum retention limits for landowners.
The people power revolution of 1986 did not change and indeed even energized the thrust for agrarian reform.
Thus, on July 17, 1987, President Corazon C. Aquino issued E.O. No. 228, declaring full land ownership in
favor of the beneficiaries of P.D. No. 27 and providing for the valuation of still unvalued lands covered by the
decree as well as the manner of their payment. This was followed on July 22, 1987 by Presidential
Proclamation No. 131, instituting a comprehensive agrarian reform program (CARP), and E.O. No. 229,
providing the mechanics for its implementation.
Subsequently, with its formal organization, the revived Congress of the Philippines took over legislative power
from the President and started its own deliberations, including extensive public hearings, on the improvement
of the interests of farmers. The result, after almost a year of spirited debate, was the enactment of R.A. No.
6657, otherwise known as the Comprehensive Agrarian Reform Law of 1988, which President Aquino signed
on June 10, 1988. This law, while considerably changing the earlier mentioned enactments, nevertheless gives
them suppletory effect insofar as they are not inconsistent with its provisions. 4
The above-captioned cases have been consolidated because they involve common legal questions, including
serious challenges to the constitutionality of the several measures mentioned above. They will be the subject
of one common discussion and resolution, The different antecedents of each case will require separate
treatment, however, and will first be explained hereunder.
G.R. No. 79777
Squarely raised in this petition is the constitutionality of P.D. No. 27, E.O. Nos. 228 and 229, and R.A. No.
6657.
The subjects of this petition are a 9-hectare riceland worked by four tenants and owned by petitioner Nicolas
Manaay and his wife and a 5-hectare riceland worked by four tenants and owned by petitioner Augustin
Hermano, Jr. The tenants were declared full owners of these lands by E.O. No. 228 as qualified farmers under
P.D. No. 27.
The petitioners are questioning P.D. No. 27 and E.O. Nos. 228 and 229 on grounds inter alia of separation of
powers, due process, equal protection and the constitutional limitation that no private property shall be taken
for public use without just compensation.
They contend that President Aquino usurped legislative power when she promulgated E.O. No. 228. The said
measure is invalid also for violation of Article XIII, Section 4, of the Constitution, for failure to provide for
retention limits for small landowners. Moreover, it does not conform to Article VI, Section 25(4) and the other
requisites of a valid appropriation.
In connection with the determination of just compensation, the petitioners argue that the same may be made
only by a court of justice and not by the President of the Philippines. They invoke the recent cases of EPZA v.
Dulay 5 and Manotok v. National Food Authority. 6 Moreover, the just compensation contemplated by the Bill of
Rights is payable in money or in cash and not in the form of bonds or other things of value.
In considering the rentals as advance payment on the land, the executive order also deprives the petitioners of
their property rights as protected by due process. The equal protection clause is also violated because the
order places the burden of solving the agrarian problems on the owners only of agricultural lands. No similar
obligation is imposed on the owners of other properties.
The petitioners also maintain that in declaring the beneficiaries under P.D. No. 27 to be the owners of the lands
occupied by them, E.O. No. 228 ignored judicial prerogatives and so violated due process. Worse, the
measure would not solve the agrarian problem because even the small farmers are deprived of their lands and
the retention rights guaranteed by the Constitution.

In his Comment, the Solicitor General stresses that P.D. No. 27 has already been upheld in the earlier cases of
Chavez v. Zobel, 7 Gonzales v. Estrella, 8 and Association of Rice and Corn Producers of the Philippines, Inc.
v. The National Land Reform Council. 9 The determination of just compensation by the executive authorities
conformably to the formula prescribed under the questioned order is at best initial or preliminary only. It does
not foreclose judicial intervention whenever sought or warranted. At any rate, the challenge to the order is
premature because no valuation of their property has as yet been made by the Department of Agrarian
Reform. The petitioners are also not proper parties because the lands owned by them do not exceed the
maximum retention limit of 7 hectares.
Replying, the petitioners insist they are proper parties because P.D. No. 27 does not provide for retention limits
on tenanted lands and that in any event their petition is a class suit brought in behalf of landowners with
landholdings below 24 hectares. They maintain that the determination of just compensation by the
administrative authorities is a final ascertainment. As for the cases invoked by the public respondent, the
constitutionality of P.D. No. 27 was merely assumed in Chavez, while what was decided in Gonzales was the
validity of the imposition of martial law.
In the amended petition dated November 22, 1588, it is contended that P.D. No. 27, E.O. Nos. 228 and 229
(except Sections 20 and 21) have been impliedly repealed by R.A. No. 6657. Nevertheless, this statute should
itself also be declared unconstitutional because it suffers from substantially the same infirmities as the earlier
measures.
A petition for intervention was filed with leave of court on June 1, 1988 by Vicente Cruz, owner of a 1. 83hectare land, who complained that the DAR was insisting on the implementation of P.D. No. 27 and E.O. No.
228 despite a compromise agreement he had reached with his tenant on the payment of rentals. In a
subsequent motion dated April 10, 1989, he adopted the allegations in the basic amended petition that the
above- mentioned enactments have been impliedly repealed by R.A. No. 6657.
G.R. No. 79310
The petitioners herein are landowners and sugar planters in the Victorias Mill District, Victorias, Negros
Occidental. Co-petitioner Planters' Committee, Inc. is an organization composed of 1,400 planter-members.
This petition seeks to prohibit the implementation of Proc. No. 131 and E.O. No. 229.
The petitioners claim that the power to provide for a Comprehensive Agrarian Reform Program as decreed by
the Constitution belongs to Congress and not the President. Although they agree that the President could
exercise legislative power until the Congress was convened, she could do so only to enact emergency
measures during the transition period. At that, even assuming that the interim legislative power of the President
was properly exercised, Proc. No. 131 and E.O. No. 229 would still have to be annulled for violating the
constitutional provisions on just compensation, due process, and equal protection.
They also argue that under Section 2 of Proc. No. 131 which provides:
Agrarian Reform Fund.-There is hereby created a special fund, to be known as the Agrarian Reform Fund, an
initial amount of FIFTY BILLION PESOS (P50,000,000,000.00) to cover the estimated cost of the
Comprehensive Agrarian Reform Program from 1987 to 1992 which shall be sourced from the receipts of the
sale of the assets of the Asset Privatization Trust and Receipts of sale of ill-gotten wealth received through the
Presidential Commission on Good Government and such other sources as government may deem appropriate.
The amounts collected and accruing to this special fund shall be considered automatically appropriated for the
purpose authorized in this Proclamation the amount appropriated is in futuro, not in esse. The money needed
to cover the cost of the contemplated expropriation has yet to be raised and cannot be appropriated at this
time.
Furthermore, they contend that taking must be simultaneous with payment of just compensation as it is
traditionally understood, i.e., with money and in full, but no such payment is contemplated in Section 5 of the
E.O. No. 229. On the contrary, Section 6, thereof provides that the Land Bank of the Philippines "shall
compensate the landowner in an amount to be established by the government, which shall be based on the
owner's declaration of current fair market value as provided in Section 4 hereof, but subject to certain controls
to be defined and promulgated by the Presidential Agrarian Reform Council." This compensation may not be
paid fully in money but in any of several modes that may consist of part cash and part bond, with interest,
maturing periodically, or direct payment in cash or bond as may be mutually agreed upon by the beneficiary
and the landowner or as may be prescribed or approved by the PARC.
The petitioners also argue that in the issuance of the two measures, no effort was made to make a careful
study of the sugar planters' situation. There is no tenancy problem in the sugar areas that can justify the
application of the CARP to them. To the extent that the sugar planters have been lumped in the same

legislation with other farmers, although they are a separate group with problems exclusively their own, their
right to equal protection has been violated.
A motion for intervention was filed on August 27,1987 by the National Federation of Sugarcane Planters
(NASP) which claims a membership of at least 20,000 individual sugar planters all over the country. On
September 10, 1987, another motion for intervention was filed, this time by Manuel Barcelona, et al.,
representing coconut and riceland owners. Both motions were granted by the Court.
NASP alleges that President Aquino had no authority to fund the Agrarian Reform Program and that, in any
event, the appropriation is invalid because of uncertainty in the amount appropriated. Section 2 of Proc. No.
131 and Sections 20 and 21 of E.O. No. 229 provide for an initial appropriation of fifty billion pesos and thus
specifies the minimum rather than the maximum authorized amount. This is not allowed. Furthermore, the
stated initial amount has not been certified to by the National Treasurer as actually available.
Two additional arguments are made by Barcelona, to wit, the failure to establish by clear and convincing
evidence the necessity for the exercise of the powers of eminent domain, and the violation of the fundamental
right to own property.
The petitioners also decry the penalty for non-registration of the lands, which is the expropriation of the said
land for an amount equal to the government assessor's valuation of the land for tax purposes. On the other
hand, if the landowner declares his own valuation he is unjustly required to immediately pay the corresponding
taxes on the land, in violation of the uniformity rule.
In his consolidated Comment, the Solicitor General first invokes the presumption of constitutionality in favor of
Proc. No. 131 and E.O. No. 229. He also justifies the necessity for the expropriation as explained in the
"whereas" clauses of the Proclamation and submits that, contrary to the petitioner's contention, a pilot project
to determine the feasibility of CARP and a general survey on the people's opinion thereon are not
indispensable prerequisites to its promulgation.
On the alleged violation of the equal protection clause, the sugar planters have failed to show that they belong
to a different class and should be differently treated. The Comment also suggests the possibility of Congress
first distributing public agricultural lands and scheduling the expropriation of private agricultural lands later.
From this viewpoint, the petition for prohibition would be premature.
The public respondent also points out that the constitutional prohibition is against the payment of public money
without the corresponding appropriation. There is no rule that only money already in existence can be the
subject of an appropriation law. Finally, the earmarking of fifty billion pesos as Agrarian Reform Fund, although
denominated as an initial amount, is actually the maximum sum appropriated. The word "initial" simply means
that additional amounts may be appropriated later when necessary.
On April 11, 1988, Prudencio Serrano, a coconut planter, filed a petition on his own behalf, assailing the
constitutionality of E.O. No. 229. In addition to the arguments already raised, Serrano contends that the
measure is unconstitutional because:
(1) Only public lands should be included in the CARP;
(2) E.O. No. 229 embraces more than one subject which is not expressed in the title;
(3) The power of the President to legislate was terminated on July 2, 1987; and
(4) The appropriation of a P50 billion special fund from the National Treasury did not originate from the House
of Representatives.
G.R. No. 79744
The petitioner alleges that the then Secretary of Department of Agrarian Reform, in violation of due process
and the requirement for just compensation, placed his landholding under the coverage of Operation Land
Transfer. Certificates of Land Transfer were subsequently issued to the private respondents, who then refused
payment of lease rentals to him.
On September 3, 1986, the petitioner protested the erroneous inclusion of his small landholding under
Operation Land transfer and asked for the recall and cancellation of the Certificates of Land Transfer in the
name of the private respondents. He claims that on December 24, 1986, his petition was denied without
hearing. On February 17, 1987, he filed a motion for reconsideration, which had not been acted upon when
E.O. Nos. 228 and 229 were issued. These orders rendered his motion moot and academic because they
directly effected the transfer of his land to the private respondents.
The petitioner now argues that:
(1) E.O. Nos. 228 and 229 were invalidly issued by the President of the Philippines.
(2) The said executive orders are violative of the constitutional provision that no private property shall be taken
without due process or just compensation.
(3) The petitioner is denied the right of maximum retention provided for under the 1987 Constitution.

The petitioner contends that the issuance of E.0. Nos. 228 and 229 shortly before Congress convened is
anomalous and arbitrary, besides violating the doctrine of separation of powers. The legislative power granted
to the President under the Transitory Provisions refers only to emergency measures that may be promulgated
in the proper exercise of the police power.
The petitioner also invokes his rights not to be deprived of his property without due process of law and to the
retention of his small parcels of riceholding as guaranteed under Article XIII, Section 4 of the Constitution. He
likewise argues that, besides denying him just compensation for his land, the provisions of E.O. No. 228
declaring that:
Lease rentals paid to the landowner by the farmer-beneficiary after October 21, 1972 shall be considered as
advance payment for the land.
is an unconstitutional taking of a vested property right. It is also his contention that the inclusion of even small
landowners in the program along with other landowners with lands consisting of seven hectares or more is
undemocratic.
In his Comment, the Solicitor General submits that the petition is premature because the motion for
reconsideration filed with the Minister of Agrarian Reform is still unresolved. As for the validity of the issuance
of E.O. Nos. 228 and 229, he argues that they were enacted pursuant to Section 6, Article XVIII of the
Transitory Provisions of the 1987 Constitution which reads:
The incumbent president shall continue to exercise legislative powers until the first Congress is convened.
On the issue of just compensation, his position is that when P.D. No. 27 was promulgated on October 21.
1972, the tenant-farmer of agricultural land was deemed the owner of the land he was tilling. The leasehold
rentals paid after that date should therefore be considered amortization payments.
In his Reply to the public respondents, the petitioner maintains that the motion he filed was resolved on
December 14, 1987. An appeal to the Office of the President would be useless with the promulgation of E.O.
Nos. 228 and 229, which in effect sanctioned the validity of the public respondent's acts.
G.R. No. 78742
The petitioners in this case invoke the right of retention granted by P.D. No. 27 to owners of rice and corn lands
not exceeding seven hectares as long as they are cultivating or intend to cultivate the same. Their respective
lands do not exceed the statutory limit but are occupied by tenants who are actually cultivating such lands.
According to P.D. No. 316, which was promulgated in implementation of P.D. No. 27:
No tenant-farmer in agricultural lands primarily devoted to rice and corn shall be ejected or removed from his
farmholding until such time as the respective rights of the tenant- farmers and the landowner shall have been
determined in accordance with the rules and regulations implementing P.D. No. 27.
The petitioners claim they cannot eject their tenants and so are unable to enjoy their right of retention because
the Department of Agrarian Reform has so far not issued the implementing rules required under the abovequoted decree. They therefore ask the Court for a writ of mandamus to compel the respondent to issue the
said rules.
In his Comment, the public respondent argues that P.D. No. 27 has been amended by LOI 474 removing any
right of retention from persons who own other agricultural lands of more than 7 hectares in aggregate area or
lands used for residential, commercial, industrial or other purposes from which they derive adequate income
for their family. And even assuming that the petitioners do not fall under its terms, the regulations implementing
P.D. No. 27 have already been issued, to wit, the Memorandum dated July 10, 1975 (Interim Guidelines on
Retention by Small Landowners, with an accompanying Retention Guide Table), Memorandum Circular No. 11
dated April 21, 1978, (Implementation Guidelines of LOI No. 474), Memorandum Circular No. 18-81 dated
December 29,1981 (Clarificatory Guidelines on Coverage of P.D. No. 27 and Retention by Small Landowners),
and DAR Administrative Order No. 1, series of 1985 (Providing for a Cut-off Date for Landowners to Apply for
Retention and/or to Protest the Coverage of their Landholdings under Operation Land Transfer pursuant to
P.D. No. 27). For failure to file the corresponding applications for retention under these measures, the
petitioners are now barred from invoking this right.
The public respondent also stresses that the petitioners have prematurely initiated this case notwithstanding
the pendency of their appeal to the President of the Philippines. Moreover, the issuance of the implementing
rules, assuming this has not yet been done, involves the exercise of discretion which cannot be controlled
through the writ of mandamus. This is especially true if this function is entrusted, as in this case, to a separate
department of the government.
In their Reply, the petitioners insist that the above-cited measures are not applicable to them because they do
not own more than seven hectares of agricultural land. Moreover, assuming arguendo that the rules were
intended to cover them also, the said measures are nevertheless not in force because they have not been

published as required by law and the ruling of this Court in Tanada v. Tuvera. 10 As for LOI 474, the same is
ineffective for the additional reason that a mere letter of instruction could not have repealed the presidential
decree.
I
Although holding neither purse nor sword and so regarded as the weakest of the three departments of the
government, the judiciary is nonetheless vested with the power to annul the acts of either the legislative or the
executive or of both when not conformable to the fundamental law. This is the reason for what some quarters
call the doctrine of judicial supremacy. Even so, this power is not lightly assumed or readily exercised. The
doctrine of separation of powers imposes upon the courts a proper restraint, born of the nature of their
functions and of their respect for the other departments, in striking down the acts of the legislative and the
executive as unconstitutional. The policy, indeed, is a blend of courtesy and caution. To doubt is to sustain. The
theory is that before the act was done or the law was enacted, earnest studies were made by Congress or the
President, or both, to insure that the Constitution would not be breached.
In addition, the Constitution itself lays down stringent conditions for a declaration of unconstitutionality,
requiring therefor the concurrence of a majority of the members of the Supreme Court who took part in the
deliberations and voted on the issue during their session en banc. 11 And as established by judge made
doctrine, the 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. 12
With particular regard to the requirement of proper party as applied in the cases before us, we hold that the
same is satisfied by the petitioners and intervenors because each of them has sustained or is in danger of
sustaining an immediate injury as a result of the acts or measures complained of. 13 And even if, strictly
speaking, they are not covered by the definition, it is still within the wide discretion of the Court to waive the
requirement and so remove the impediment to its addressing and resolving the serious constitutional questions
raised.
In the first Emergency Powers Cases, 14 ordinary citizens and taxpayers were allowed to question the
constitutionality of several executive orders issued by President Quirino although they were invoking only an
indirect and general interest shared in common with the public. The Court dismissed the objection that they
were not proper parties and ruled that "the transcendental importance to the public of these cases demands
that they be settled promptly and definitely, brushing aside, if we must, technicalities of procedure." We have
since then applied this exception in many other cases. 15
The other above-mentioned requisites have also been met in the present petitions.
In must be stressed that despite the inhibitions pressing upon the Court when confronted with constitutional
issues like the ones now before it, 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 as God and its conscience
give it the light to probe its meaning and discover its purpose. Personal motives and political considerations are
irrelevancies that cannot influence its decision. Blandishment is as ineffectual as intimidation.
For all the awesome power of the Congress and the Executive, the Court will not hesitate to "make the
hammer fall, and heavily," to use Justice Laurel's pithy language, where the acts of these departments, or of
any public official, betray the people's will as expressed in the Constitution.
It need only be added, to borrow again the words of Justice Laurel, that
... when the judiciary mediates to allocate constitutional boundaries, it does not assert any superiority over the
other departments; it does not in reality nullify or invalidate an act of the Legislature, but only asserts the
solemn and sacred obligation assigned to it by the Constitution to determine conflicting claims of authority
under the Constitution and to establish for the parties in an actual controversy the rights which that instrument
secures and guarantees to them. This is in truth all that is involved in what is termed "judicial supremacy"
which properly is the power of judicial review under the Constitution. 16
The cases before us categorically raise constitutional questions that this Court must categorically resolve. And
so we shall.
II
We proceed first to the examination of the preliminary issues before resolving the more serious challenges to
the constitutionality of the several measures involved in these petitions.
The promulgation of P.D. No. 27 by President Marcos in the exercise of his powers under martial law has
already been sustained in Gonzales v. Estrella and we find no reason to modify or reverse it on that issue. As

for the power of President Aquino to promulgate Proc. No. 131 and E.O. Nos. 228 and 229, the same was
authorized under Section 6 of the Transitory Provisions of the 1987 Constitution, quoted above.
The said measures were issued by President Aquino before July 27, 1987, when the Congress of the
Philippines was formally convened and took over legislative power from her. They are not "midnight"
enactments intended to pre-empt the legislature because E.O. No. 228 was issued on July 17, 1987, and the
other measures, i.e., Proc. No. 131 and E.O. No. 229, were both issued on July 22, 1987. Neither is it correct
to say that these measures ceased to be valid when she lost her legislative power for, like any statute, they
continue to be in force unless modified or repealed by subsequent law or declared invalid by the courts. A
statute does not ipso facto become inoperative simply because of the dissolution of the legislature that enacted
it. By the same token, President Aquino's loss of legislative power did not have the effect of invalidating all the
measures enacted by her when and as long as she possessed it.
Significantly, the Congress she is alleged to have undercut has not rejected but in fact substantially affirmed
the challenged measures and has specifically provided that they shall be suppletory to R.A. No. 6657
whenever not inconsistent with its provisions. 17 Indeed, some portions of the said measures, like the creation
of the P50 billion fund in Section 2 of Proc. No. 131, and Sections 20 and 21 of E.O. No. 229, have been
incorporated by reference in the CARP Law. 18
That fund, as earlier noted, is itself being questioned on the ground that it does not conform to the
requirements of a valid appropriation as specified in the Constitution. Clearly, however, Proc. No. 131 is not an
appropriation measure even if it does provide for the creation of said fund, for that is not its principal purpose.
An appropriation law is one the primary and specific purpose of which is to authorize the release of public
funds from the treasury. 19 The creation of the fund is only incidental to the main objective of the proclamation,
which is agrarian reform.
It should follow that the specific constitutional provisions invoked, to wit, Section 24 and Section 25(4) of Article
VI, are not applicable. With particular reference to Section 24, this obviously could not have been complied
with for the simple reason that the House of Representatives, which now has the exclusive power to initiate
appropriation measures, had not yet been convened when the proclamation was issued. The legislative power
was then solely vested in the President of the Philippines, who embodied, as it were, both houses of Congress.
The argument of some of the petitioners that Proc. No. 131 and E.O. No. 229 should be invalidated because
they do not provide for retention limits as required by Article XIII, Section 4 of the Constitution is no longer
tenable. R.A. No. 6657 does provide for such limits now in Section 6 of the law, which in fact is one of its most
controversial provisions. This section declares:
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-sized farm, such as commodity produced, terrain, infrastructure, and soil fertility as determined by
the Presidential Agrarian Reform Council (PARC) created hereunder, but in no case shall retention by the
landowner exceed five (5) hectares. Three (3) hectares may be awarded to each child of the landowner,
subject to the following qualifications: (1) that he is at least fifteen (15) years of age; and (2) that he is actually
tilling the land 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, 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 argument that E.O. No. 229 violates the constitutional requirement that a bill shall have only one subject,
to be expressed in its title, deserves only short attention. It is settled that the title of the bill does not have to be
a catalogue of its contents and will suffice if the matters embodied in the text are relevant to each other and
may be inferred from the title. 20
The Court wryly observes that during the past dictatorship, every presidential issuance, by whatever name it
was called, had the force and effect of law because it came from President Marcos. Such are the ways of
despots. Hence, it is futile to argue, as the petitioners do in G.R. No. 79744, that LOI 474 could not have
repealed P.D. No. 27 because the former was only a letter of instruction. The important thing is that it was
issued by President Marcos, whose word was law during that time.
But for all their peremptoriness, these issuances from the President Marcos still had to comply with the
requirement for publication as this Court held in Tanada v. Tuvera. 21 Hence, unless published in the Official
Gazette in accordance with Article 2 of the Civil Code, they could not have any force and effect if they were
among those enactments successfully challenged in that case. LOI 474 was published, though, in the Official
Gazette dated November 29,1976.)

Finally, there is the contention of the public respondent in G.R. No. 78742 that the writ of mandamus cannot
issue to compel the performance of a discretionary act, especially by a specific department of the government.
That is true as a general proposition but is subject to one important qualification. Correctly and categorically
stated, the rule is that mandamus will lie to compel the discharge of the discretionary duty itself but not to
control the discretion to be exercised. In other words, mandamus can issue to require action only but not
specific action.
Whenever a duty is imposed upon a public official and an unnecessary and unreasonable delay in the exercise
of such duty occurs, if it is a clear duty imposed by law, the courts will intervene by the extraordinary legal
remedy of mandamus to compel action. If the duty is purely ministerial, the courts will require specific action. If
the duty is purely discretionary, the courts by mandamus will require action only. For example, if an inferior
court, public official, or board should, for an unreasonable length of time, fail to decide a particular question to
the great detriment of all parties concerned, or a court should refuse to take jurisdiction of a cause when the
law clearly gave it jurisdiction mandamus will issue, in the first case to require a decision, and in the second to
require that jurisdiction be taken of the cause. 22
And while it is true that as a rule the writ will not be proper as long as there is still a plain, speedy and adequate
remedy available from the administrative authorities, resort to the courts may still be permitted if the issue
raised is a question of law. 23
III
There are traditional distinctions between the police power and the power of eminent domain that logically
preclude the application of both powers at the same time on the same subject. In the case of City of Baguio v.
NAWASA, 24 for example, where a law required the transfer of all municipal waterworks systems to the
NAWASA in exchange for its assets of equivalent value, the Court held that the power being exercised was
eminent domain because the property involved was wholesome and intended for a public use. Property
condemned under the police power is noxious or intended for a noxious purpose, such as a building on the
verge of collapse, which should be demolished for the public safety, or obscene materials, which should be
destroyed in the interest of public morals. The confiscation of such property is not compensable, unlike the
taking of property under the power of expropriation, which requires the payment of just compensation to the
owner.
In the case of Pennsylvania Coal Co. v. Mahon, 25 Justice Holmes laid down the limits of the police power in a
famous aphorism: "The general rule at least is that while property may be regulated to a certain extent, if
regulation goes too far it will be recognized as a taking." The regulation that went "too far" was a law prohibiting
mining which might cause the subsidence of structures for human habitation constructed on the land surface.
This was resisted by a coal company which had earlier granted a deed to the land over its mine but reserved
all mining rights thereunder, with the grantee assuming all risks and waiving any damage claim. The Court held
the law could not be sustained without compensating the grantor. Justice Brandeis filed a lone dissent in which
he argued that there was a valid exercise of the police power. He said:
Every restriction upon the use of property imposed in the exercise of the police power deprives the owner of
some right theretofore enjoyed, and is, in that sense, an abridgment by the State of rights in property without
making compensation. But restriction imposed to protect the public health, safety or morals from dangers
threatened is not a taking. The restriction here in question is merely the prohibition of a noxious use. The
property so restricted remains in the possession of its owner. The state does not appropriate it or make any
use of it. The state merely prevents the owner from making a use which interferes with paramount rights of the
public. Whenever the use prohibited ceases to be noxious as it may because of further changes in local or
social conditions the restriction will have to be removed and the owner will again be free to enjoy his
property as heretofore.
Recent trends, however, would indicate not a polarization but a mingling of the police power and the power of
eminent domain, with the latter being used as an implement of the former like the power of taxation. The
employment of the taxing power to achieve a police purpose has long been accepted. 26 As for the power of
expropriation, Prof. John J. Costonis of the University of Illinois College of Law (referring to the earlier case of
Euclid v. Ambler Realty Co., 272 US 365, which sustained a zoning law under the police power) makes the
following significant remarks:
Euclid, moreover, was decided in an era when judges located the Police and eminent domain powers on
different planets. Generally speaking, they viewed eminent domain as encompassing public acquisition of
private property for improvements that would be available for public use," literally construed. To the police
power, on the other hand, they assigned the less intrusive task of preventing harmful externalities a point
reflected in the Euclid opinion's reliance on an analogy to nuisance law to bolster its support of zoning. So long

as suppression of a privately authored harm bore a plausible relation to some legitimate "public purpose," the
pertinent measure need have afforded no compensation whatever. With the progressive growth of
government's involvement in land use, the distance between the two powers has contracted considerably.
Today government often employs eminent domain interchangeably with or as a useful complement to the
police power-- a trend expressly approved in the Supreme Court's 1954 decision in Berman v. Parker, which
broadened the reach of eminent domain's "public use" test to match that of the police power's standard of
"public purpose." 27
The Berman case sustained a redevelopment project and the improvement of blighted areas in the District of
Columbia as a proper exercise of the police power. On the role of eminent domain in the attainment of this
purpose, Justice Douglas declared:
If those who govern the District of Columbia decide that the Nation's Capital should be beautiful as well as
sanitary, there is nothing in the Fifth Amendment that stands in the way.
Once the object is within the authority of Congress, the right to realize it through the exercise of eminent
domain is clear.
For the power of eminent domain is merely the means to the end. 28
In Penn Central Transportation Co. v. New York City, 29 decided by a 6-3 vote in 1978, the U.S Supreme Court
sustained the respondent's Landmarks Preservation Law under which the owners of the Grand Central
Terminal had not been allowed to construct a multi-story office building over the Terminal, which had been
designated a historic landmark. Preservation of the landmark was held to be a valid objective of the police
power. The problem, however, was that the owners of the Terminal would be deprived of the right to use the
airspace above it although other landowners in the area could do so over their respective properties. While
insisting that there was here no taking, the Court nonetheless recognized certain compensatory rights accruing
to Grand Central Terminal which it said would "undoubtedly mitigate" the loss caused by the regulation. This
"fair compensation," as he called it, was explained by Prof. Costonis in this wise:
In return for retaining the Terminal site in its pristine landmark status, Penn Central was authorized to transfer
to neighboring properties the authorized but unused rights accruing to the site prior to the Terminal's
designation as a landmark the rights which would have been exhausted by the 59-story building that the city
refused to countenance atop the Terminal. Prevailing bulk restrictions on neighboring sites were
proportionately relaxed, theoretically enabling Penn Central to recoup its losses at the Terminal site by
constructing or selling to others the right to construct larger, hence more profitable buildings on the transferee
sites. 30
The cases before us present no knotty complication insofar as the question of compensable taking is
concerned. To the extent that the measures under challenge merely prescribe retention limits for landowners,
there is an exercise of the police power for the regulation of private property in accordance with the
Constitution. But where, to carry out such regulation, it becomes necessary to deprive such owners of
whatever lands they may own in excess of the maximum area allowed, there is definitely a taking under the
power of eminent domain for which payment of just compensation is imperative. The taking contemplated is
not a mere limitation of the use of the land. What is required is the surrender of the title to and the physical
possession of the said excess and all beneficial rights accruing to the owner in favor of the farmer-beneficiary.
This is definitely an exercise not of the police power but of the power of eminent domain.
Whether as an exercise of the police power or of the power of eminent domain, the several measures before
us are challenged as violative of the due process and equal protection clauses.
The challenge to Proc. No. 131 and E.O. Nos. 228 and 299 on the ground that no retention limits are
prescribed has already been discussed and dismissed. It is noted that although they excited many bitter
exchanges during the deliberation of the CARP Law in Congress, the retention limits finally agreed upon are,
curiously enough, not being questioned in these petitions. We therefore do not discuss them here. The Court
will come to the other claimed violations of due process in connection with our examination of the adequacy of
just compensation as required under the power of expropriation.
The argument of the small farmers that they have been denied equal protection because of the absence of
retention limits has also become academic under Section 6 of R.A. No. 6657. Significantly, they too have not
questioned the area of such limits. There is also the complaint that they should not be made to share the
burden of agrarian reform, an objection also made by the sugar planters on the ground that they belong to a
particular class with particular interests of their own. However, no evidence has been submitted to the Court
that the requisites of a valid classification have been violated.
Classification has been defined as the grouping of persons or things similar to each other in certain particulars
and different from each other in these same particulars. 31 To be valid, it must conform to the following

requirements: (1) it must be based on substantial distinctions; (2) it must be germane to the purposes of the
law; (3) it must not be limited to existing conditions only; and (4) it must apply equally to all the members of the
class. 32 The Court finds that all these requisites have been met by the measures here challenged as arbitrary
and discriminatory.
Equal protection simply means that all persons or things similarly situated must be treated alike both as to the
rights conferred and the liabilities imposed. 33 The petitioners have not shown that they belong to a different
class and entitled to a different treatment. The argument that not only landowners but also owners of other
properties must be made to share the burden of implementing land reform must be rejected. There is a
substantial distinction between these two classes of owners that is clearly visible except to those who will not
see. There is no need to elaborate on this matter. In any event, the Congress is allowed a wide leeway in
providing for a valid classification. Its decision is accorded recognition and respect by the courts of justice
except only where its discretion is abused to the detriment of the Bill of Rights.
It is worth remarking at this juncture that a statute may be sustained under the police power only if there is a
concurrence of the lawful subject and the lawful method. Put otherwise, the interests of the public generally as
distinguished from those of a particular class require the interference of the State and, no less important, the
means employed are reasonably necessary for the attainment of the purpose sought to be achieved and not
unduly oppressive upon individuals. 34 As the subject and purpose of agrarian reform have been laid down by
the Constitution itself, we may say that the first requirement has been satisfied. What remains to be examined
is the validity of the method employed to achieve the constitutional goal.
One of the basic principles of the democratic system is that where the rights of the individual are concerned,
the end does not justify the means. It is not enough that there be a valid objective; it is also necessary that the
means employed to pursue it be in keeping with the Constitution. Mere expediency will not excuse
constitutional shortcuts. There is no question that not even the strongest moral conviction or the most urgent
public need, subject only to a few notable exceptions, will excuse the bypassing of an individual's rights. It is no
exaggeration to say that a, person invoking a right guaranteed under Article III of the Constitution is a majority
of one even as against the rest of the nation who would deny him that right.
That right covers the person's life, his liberty and his property under Section 1 of Article III of the Constitution.
With regard to his property, the owner enjoys the added protection of Section 9, which reaffirms the familiar
rule that private property shall not be taken for public use without just compensation.
This brings us now to the power of eminent domain.
IV
Eminent domain is an inherent power of the State that enables it to forcibly acquire private lands intended for
public use upon payment of just compensation to the owner. Obviously, there is no need to expropriate where
the owner is willing to sell under terms also acceptable to the purchaser, in which case an ordinary deed of
sale may be agreed upon by the parties. 35 It is only where the owner is unwilling to sell, or cannot accept the
price or other conditions offered by the vendee, that the power of eminent domain will come into play to assert
the paramount authority of the State over the interests of the property owner. Private rights must then yield to
the irresistible demands of the public interest on the time-honored justification, as in the case of the police
power, that the welfare of the people is the supreme law.
But for all its primacy and urgency, the power of expropriation is by no means absolute (as indeed no power is
absolute). The limitation is found in the constitutional injunction that "private property shall not be taken for
public use without just compensation" and in the abundant jurisprudence that has evolved from the
interpretation of this principle. Basically, the requirements for a proper exercise of the power are: (1) public use
and (2) just compensation.
Let us dispose first of the argument raised by the petitioners in G.R. No. 79310 that the State should first
distribute public agricultural lands in the pursuit of agrarian reform instead of immediately disturbing property
rights by forcibly acquiring private agricultural lands. Parenthetically, it is not correct to say that only public
agricultural lands may be covered by the CARP as the Constitution calls for "the just distribution of all
agricultural lands." In any event, the decision to redistribute private agricultural lands in the manner prescribed
by the CARP was made by the legislative and executive departments in the exercise of their discretion. We are
not justified in reviewing that discretion in the absence of a clear showing that it has been abused.
A becoming courtesy admonishes us to respect the decisions of the political departments when they decide
what is known as the political question. As explained by Chief Justice Concepcion in the case of Taada v.
Cuenco: 36
The term "political question" connotes what it means in ordinary parlance, namely, a question of policy. It refers
to "those questions which, under the Constitution, are to be decided by the people in their sovereign capacity;

or in regard to which full discretionary authority has been delegated to the legislative or executive branch of the
government." It is concerned with issues dependent upon the wisdom, not legality, of a particular measure.
It is true that the concept of the political question has been constricted with the enlargement of judicial power,
which now includes the authority of the courts "to determine whether or not there has been a grave abuse of
discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the
Government." 37 Even so, this should not be construed as a license for us to reverse the other departments
simply because their views may not coincide with ours.
The legislature and the executive have been seen fit, in their wisdom, to include in the CARP the redistribution
of private landholdings (even as the distribution of public agricultural lands is first provided for, while also
continuing apace under the Public Land Act and other cognate laws). The Court sees no justification to
interpose its authority, which we may assert only if we believe that the political decision is not unwise, but
illegal. We do not find it to be so.
In U.S. v. Chandler-Dunbar Water Power Company, 38 it was held:
Congress having determined, as it did by the Act of March 3,1909 that the entire St. Mary's river between the
American bank and the international line, as well as all of the upland north of the present ship canal,
throughout its entire length, was "necessary for the purpose of navigation of said waters, and the waters
connected therewith," that determination is conclusive in condemnation proceedings instituted by the United
States under that Act, and there is no room for judicial review of the judgment of Congress ... .
As earlier observed, the requirement for public use has already been settled for us by the Constitution itself No
less than the 1987 Charter calls for agrarian reform, which is the reason why private agricultural lands are to
be taken from their owners, subject to the prescribed maximum retention limits. The purposes specified in P.D.
No. 27, Proc. No. 131 and R.A. No. 6657 are only an elaboration of the constitutional injunction that the State
adopt the necessary measures "to encourage and undertake the just distribution of all agricultural lands to
enable farmers who are landless to own directly or collectively the lands they till." That public use, as
pronounced by the fundamental law itself, must be binding on us.
The second requirement, i.e., the payment of just compensation, needs a longer and more thoughtful
examination.
Just compensation is defined as the full and fair equivalent of the property taken from its owner by the
expropriator. 39 It has been repeatedly stressed by this Court that the measure is not the taker's gain but the
owner's loss. 40 The word "just" is used to intensify the meaning of the word "compensation" to convey the
idea that the equivalent to be rendered for the property to be taken shall be real, substantial, full, ample. 41
It bears repeating that the measures challenged in these petitions contemplate more than a mere regulation of
the use of private lands under the police power. We deal here with an actual taking of private agricultural lands
that has dispossessed the owners of their property and deprived them of all its beneficial use and enjoyment,
to entitle them to the just compensation mandated by the Constitution.
As held in Republic of the Philippines v. Castellvi, 42 there is compensable taking when the following
conditions concur: (1) the expropriator must enter a private property; (2) the entry must be for more than a
momentary period; (3) the entry must be under warrant or color of legal authority; (4) the property must be
devoted to public use or otherwise informally appropriated or injuriously affected; and (5) the utilization of the
property for public use must be in such a way as to oust the owner and deprive him of beneficial enjoyment of
the property. All these requisites are envisioned in the measures before us.
Where the State itself is the expropriator, it is not necessary for it to make a deposit upon its taking possession
of the condemned property, as "the compensation is a public charge, the good faith of the public is pledged for
its payment, and all the resources of taxation may be employed in raising the amount." 43 Nevertheless,
Section 16(e) of the CARP Law provides that:
Upon receipt by the landowner of the corresponding payment or, in case of rejection or no response from the
landowner, upon the deposit with an accessible bank designated by the DAR of the compensation in cash or in
LBP bonds in accordance with this Act, the DAR shall take immediate possession of the land and shall request
the proper Register of Deeds to issue a Transfer Certificate of Title (TCT) in the name of the Republic of the
Philippines. The DAR shall thereafter proceed with the redistribution of the land to the qualified beneficiaries.
Objection is raised, however, to the manner of fixing the just compensation, which it is claimed is entrusted to
the administrative authorities in violation of judicial prerogatives. Specific reference is made to Section 16(d),
which provides that in case of the rejection or disregard by the owner of the offer of the government to buy his
land... the DAR shall conduct summary administrative proceedings to determine the compensation for the land by
requiring the landowner, the LBP and other interested parties to submit evidence as to the just compensation

for the land, within fifteen (15) days from the receipt of the notice. After the expiration of the above period, the
matter is deemed submitted for decision. The DAR shall decide the case within thirty (30) days after it is
submitted for decision.
To be sure, the determination of just compensation is a function addressed to the courts of justice and may not
be usurped by any other branch or official of the government. EPZA v. Dulay 44 resolved a challenge to
several decrees promulgated by President Marcos providing that the just compensation for property under
expropriation should be either the assessment of the property by the government or the sworn valuation
thereof by the owner, whichever was lower. In declaring these decrees unconstitutional, the Court held through
Mr. Justice Hugo E. Gutierrez, Jr.:
The method of ascertaining just compensation under the aforecited decrees constitutes impermissible
encroachment on judicial prerogatives. It tends to render this Court inutile in a matter which under this
Constitution is reserved to it for final determination.
Thus, although in an expropriation proceeding the court technically would still have the power to determine the
just compensation for the property, following the applicable decrees, its task would be relegated to simply
stating the lower value of the property as declared either by the owner or the assessor. As a necessary
consequence, it would be useless for the court to appoint commissioners under Rule 67 of the Rules of Court.
Moreover, the need to satisfy the due process clause in the taking of private property is seemingly fulfilled
since it cannot be said that a judicial proceeding was not had before the actual taking. However, the strict
application of the decrees during the proceedings would be nothing short of a mere formality or charade as the
court has only to choose between the valuation of the owner and that of the assessor, and its choice is always
limited to the lower of the two. The court cannot exercise its discretion or independence in determining what is
just or fair. Even a grade school pupil could substitute for the judge insofar as the determination of
constitutional just compensation is concerned.
xxx
In the present petition, we are once again confronted with the same question of whether the courts under P.D.
No. 1533, which contains the same provision on just compensation as its predecessor decrees, still have the
power and authority to determine just compensation, independent of what is stated by the decree and to this
effect, to appoint commissioners for such purpose.
This time, we answer in the affirmative.
xxx
It is violative of due process to deny the owner the opportunity to prove that the valuation in the tax documents
is unfair or wrong. And it is repulsive to the basic concepts of justice and fairness to allow the haphazard work
of a minor bureaucrat or clerk to absolutely prevail over the judgment of a court promulgated only after expert
commissioners have actually viewed the property, after evidence and arguments pro and con have been
presented, and after all factors and considerations essential to a fair and just determination have been
judiciously evaluated.
A reading of the aforecited Section 16(d) will readily show that it does not suffer from the arbitrariness that
rendered the challenged decrees constitutionally objectionable. Although the proceedings are described as
summary, the landowner and other interested parties are nevertheless allowed an opportunity to submit
evidence on the real value of the property. But more importantly, the determination of the just compensation by
the DAR is not by any means final and conclusive upon the landowner or any other interested party, for Section
16(f) clearly provides:
Any party who disagrees with the decision may bring the matter to the court of proper jurisdiction for final
determination of just compensation.
The determination made by the DAR is only preliminary unless accepted by all parties concerned. Otherwise,
the courts of justice will still have the right to review with finality the said determination in the exercise of what
is admittedly a judicial function.
The second and more serious objection to the provisions on just compensation is not as easily resolved.
This refers to Section 18 of the CARP Law providing in full as follows:
SEC. 18. Valuation and Mode of Compensation. The LBP shall compensate the landowner in such amount
as may be agreed upon by the landowner and the DAR and the LBP, in accordance with the criteria provided
for in Sections 16 and 17, and other pertinent provisions hereof, or as may be finally determined by the court,
as the just compensation for the land.
The compensation shall be paid in one of the following modes, at the option of the landowner:
(1)
Cash payment, under the following terms and conditions:

(a)
For lands above fifty (50) hectares, insofar as the excess hectarage is concerned Twenty-five
percent (25%) cash, the balance to be paid in government financial instruments negotiable at any time.
(b)
For lands above twenty-four (24) hectares and up to fifty (50) hectares Thirty percent (30%) cash,
the balance to be paid in government financial instruments negotiable at any time.
(c)
For lands twenty-four (24) hectares and below Thirty-five percent (35%) cash, the balance to be paid
in government financial instruments negotiable at any time.
(2)
Shares of stock in government-owned or controlled corporations, LBP preferred shares, physical
assets or other qualified investments in accordance with guidelines set by the PARC;
(3)
Tax credits which can be used against any tax liability;
(4)
LBP bonds, which shall have the following features:
(a)
Market interest rates aligned with 91-day treasury bill rates. Ten percent (10%) of the face value of the
bonds shall mature every year from the date of issuance until the tenth (10th) year: Provided, That should the
landowner choose to forego the cash portion, whether in full or in part, he shall be paid correspondingly in LBP
bonds;
(b)
Transferability and negotiability. Such LBP bonds may be used by the landowner, his successors-ininterest or his assigns, up to the amount of their face value, for any of the following:
(i)
Acquisition of land or other real properties of the government, including assets under the Asset
Privatization Program and other assets foreclosed by government financial institutions in the same province or
region where the lands for which the bonds were paid are situated;
(ii)
Acquisition of shares of stock of government-owned or controlled corporations or shares of stock
owned by the government in private corporations;
(iii)
Substitution for surety or bail bonds for the provisional release of accused persons, or for performance
bonds;
(iv)
Security for loans with any government financial institution, provided the proceeds of the loans shall be
invested in an economic enterprise, preferably in a small and medium- scale industry, in the same province or
region as the land for which the bonds are paid;
(v)
Payment for various taxes and fees to government: Provided, That the use of these bonds for these
purposes will be limited to a certain percentage of the outstanding balance of the financial instruments;
Provided, further, That the PARC shall determine the percentages mentioned above;
(vi)
Payment for tuition fees of the immediate family of the original bondholder in government universities,
colleges, trade schools, and other institutions;
(vii)
Payment for fees of the immediate family of the original bondholder in government hospitals; and
(viii)
Such other uses as the PARC may from time to time allow.
The contention of the petitioners in G.R. No. 79777 is that the above provision is unconstitutional insofar as it
requires the owners of the expropriated properties to accept just compensation therefor in less than money,
which is the only medium of payment allowed. In support of this contention, they cite jurisprudence holding
that:
The fundamental rule in expropriation matters is that the owner of the property expropriated is entitled to a just
compensation, which should be neither more nor less, whenever it is possible to make the assessment, than
the money equivalent of said property. Just compensation has always been understood to be the just and
complete equivalent of the loss which the owner of the thing expropriated has to suffer by reason of the
expropriation . 45 (Emphasis supplied.)
In J.M. Tuazon Co. v. Land Tenure Administration, 46 this Court held:
It is well-settled that just compensation means the equivalent for the value of the property at the time of its
taking. Anything beyond that is more, and anything short of that is less, than just compensation. It means a fair
and full equivalent for the loss sustained, which is the measure of the indemnity, not whatever gain would
accrue to the expropriating entity. The market value of the land taken is the just compensation to which the
owner of condemned property is entitled, the market value being that sum of money which a person desirous,
but not compelled to buy, and an owner, willing, but not compelled to sell, would agree on as a price to be
given and received for such property. (Emphasis supplied.)
In the United States, where much of our jurisprudence on the subject has been derived, the weight of authority
is also to the effect that just compensation for property expropriated is payable only in money and not
otherwise. Thus
The medium of payment of compensation is ready money or cash. The condemnor cannot compel the owner
to accept anything but money, nor can the owner compel or require the condemnor to pay him on any other
basis than the value of the property in money at the time and in the manner prescribed by the Constitution and

the statutes. When the power of eminent domain is resorted to, there must be a standard medium of payment,
binding upon both parties, and the law has fixed that standard as money in cash. 47 (Emphasis supplied.)
Part cash and deferred payments are not and cannot, in the nature of things, be regarded as a reliable and
constant standard of compensation. 48
"Just compensation" for property taken by condemnation means a fair equivalent in money, which must be paid
at least within a reasonable time after the taking, and it is not within the power of the Legislature to substitute
for such payment future obligations, bonds, or other valuable advantage. 49 (Emphasis supplied.)
It cannot be denied from these cases that the traditional medium for the payment of just compensation is
money and no other. And so, conformably, has just compensation been paid in the past solely in that medium.
However, we do not deal here with the traditional excercise of the power of eminent domain. This is not an
ordinary expropriation where only a specific property of relatively limited area is sought to be taken by the State
from its owner for a specific and perhaps local purpose.
What we deal with here is a revolutionary kind of expropriation.
The expropriation before us affects all private agricultural lands whenever found and of whatever kind as long
as they are in excess of the maximum retention limits allowed their owners. This kind of expropriation is
intended for the benefit not only of a particular community or of a small segment of the population but of the
entire Filipino nation, from all levels of our society, from the impoverished farmer to the land-glutted owner. Its
purpose does not cover only the whole territory of this country but goes beyond in time to the foreseeable
future, which it hopes to secure and edify with the vision and the sacrifice of the present generation of Filipinos.
Generations yet to come are as involved in this program as we are today, although hopefully only as
beneficiaries of a richer and more fulfilling life we will guarantee to them tomorrow through our thoughtfulness
today. And, finally, let it not be forgotten that it is no less than the Constitution itself that has ordained this
revolution in the farms, calling for "a just distribution" among the farmers of lands that have heretofore been the
prison of their dreams but can now become the key at least to their deliverance.
Such a program will involve not mere millions of pesos. The cost will be tremendous. Considering the vast
areas of land subject to expropriation under the laws before us, we estimate that hundreds of billions of pesos
will be needed, far more indeed than the amount of P50 billion initially appropriated, which is already
staggering as it is by our present standards. Such amount is in fact not even fully available at this time.
We assume that the framers of the Constitution were aware of this difficulty when they called for agrarian
reform as a top priority project of the government. It is a part of this assumption that when they envisioned the
expropriation that would be needed, they also intended that the just compensation would have to be paid not in
the orthodox way but a less conventional if more practical method. There can be no doubt that they were
aware of the financial limitations of the government and had no illusions that there would be enough money to
pay in cash and in full for the lands they wanted to be distributed among the farmers. We may therefore
assume that their intention was to allow such manner of payment as is now provided for by the CARP Law,
particularly the payment of the balance (if the owner cannot be paid fully with money), or indeed of the entire
amount of the just compensation, with other things of value. We may also suppose that what they had in mind
was a similar scheme of payment as that prescribed in P.D. No. 27, which was the law in force at the time they
deliberated on the new Charter and with which they presumably agreed in principle.
The Court has not found in the records of the Constitutional Commission any categorical agreement among the
members regarding the meaning to be given the concept of just compensation as applied to the
comprehensive agrarian reform program being contemplated. There was the suggestion to "fine tune" the
requirement to suit the demands of the project even as it was also felt that they should "leave it to Congress" to
determine how payment should be made to the landowner and reimbursement required from the farmerbeneficiaries. Such innovations as "progressive compensation" and "State-subsidized compensation" were
also proposed. In the end, however, no special definition of the just compensation for the lands to be
expropriated was reached by the Commission. 50
On the other hand, there is nothing in the records either that militates against the assumptions we are making
of the general sentiments and intention of the members on the content and manner of the payment to be made
to the landowner in the light of the magnitude of the expenditure and the limitations of the expropriator.
With these assumptions, the Court hereby declares that the content and manner of the just compensation
provided for in the afore- quoted Section 18 of the CARP Law is not violative of the Constitution. We do not
mind admitting that a certain degree of pragmatism has influenced our decision on this issue, but after all this
Court is not a cloistered institution removed from the realities and demands of society or oblivious to the need
for its enhancement. The Court is as acutely anxious as the rest of our people to see the goal of agrarian

reform achieved at last after the frustrations and deprivations of our peasant masses during all these
disappointing decades. We are aware that invalidation of the said section will result in the nullification of the
entire program, killing the farmer's hopes even as they approach realization and resurrecting the spectre of
discontent and dissent in the restless countryside. That is not in our view the intention of the Constitution, and
that is not what we shall decree today.
Accepting the theory that payment of the just compensation is not always required to be made fully in money,
we find further that the proportion of cash payment to the other things of value constituting the total payment,
as determined on the basis of the areas of the lands expropriated, is not unduly oppressive upon the
landowner. It is noted that the smaller the land, the bigger the payment in money, primarily because the small
landowner will be needing it more than the big landowners, who can afford a bigger balance in bonds and other
things of value. No less importantly, the government financial instruments making up the balance of the
payment are "negotiable at any time." The other modes, which are likewise available to the landowner at his
option, are also not unreasonable because payment is made in shares of stock, LBP bonds, other properties or
assets, tax credits, and other things of value equivalent to the amount of just compensation.
Admittedly, the compensation contemplated in the law will cause the landowners, big and small, not a little
inconvenience. As already remarked, this cannot be avoided. Nevertheless, it is devoutly hoped that these
countrymen of ours, conscious as we know they are of the need for their forebearance and even sacrifice, will
not begrudge us their indispensable share in the attainment of the ideal of agrarian reform. Otherwise, our
pursuit of this elusive goal will be like the quest for the Holy Grail.
The complaint against the effects of non-registration of the land under E.O. No. 229 does not seem to be viable
any more as it appears that Section 4 of the said Order has been superseded by Section 14 of the CARP Law.
This repeats the requisites of registration as embodied in the earlier measure but does not provide, as the
latter did, that in case of failure or refusal to register the land, the valuation thereof shall be that given by the
provincial or city assessor for tax purposes. On the contrary, the CARP Law says that the just compensation
shall be ascertained on the basis of the factors mentioned in its Section 17 and in the manner provided for in
Section 16.
The last major challenge to CARP is that the landowner is divested of his property even before actual payment
to him in full of just compensation, in contravention of a well- accepted principle of eminent domain.
The recognized rule, indeed, is that title to the property expropriated shall pass from the owner to the
expropriator only upon full payment of the just compensation. Jurisprudence on this settled principle is
consistent both here and in other democratic jurisdictions. Thus:
Title to property which is the subject of condemnation proceedings does not vest the condemnor until the
judgment fixing just compensation is entered and paid, but the condemnor's title relates back to the date on
which the petition under the Eminent Domain Act, or the commissioner's report under the Local Improvement
Act, is filed. 51
... although the right to appropriate and use land taken for a canal is complete at the time of entry, title to the
property taken remains in the owner until payment is actually made. 52 (Emphasis supplied.)
In Kennedy v. Indianapolis, 53 the US Supreme Court cited several cases holding that title to property does not
pass to the condemnor until just compensation had actually been made. In fact, the decisions appear to be
uniformly to this effect. As early as 1838, in Rubottom v. McLure, 54 it was held that "actual payment to the
owner of the condemned property was a condition precedent to the investment of the title to the property in the
State" albeit "not to the appropriation of it to public use." In Rexford v. Knight, 55 the Court of Appeals of New
York said that the construction upon the statutes was that the fee did not vest in the State until the payment of
the compensation although the authority to enter upon and appropriate the land was complete prior to the
payment. Kennedy further said that "both on principle and authority the rule is ... that the right to enter on and
use the property is complete, as soon as the property is actually appropriated under the authority of law for a
public use, but that the title does not pass from the owner without his consent, until just compensation has
been made to him."
Our own Supreme Court has held in Visayan Refining Co. v. Camus and Paredes, 56 that:
If the laws which we have exhibited or cited in the preceding discussion are attentively examined it will be
apparent that the method of expropriation adopted in this jurisdiction is such as to afford absolute reassurance
that no piece of land can be finally and irrevocably taken from an unwilling owner until compensation is
paid ... . (Emphasis supplied.)
It is true that P.D. No. 27 expressly ordered the emancipation of tenant-farmer as October 21, 1972 and
declared that he shall "be deemed the owner" of a portion of land consisting of a family-sized farm except that
"no title to the land owned by him was to be actually issued to him unless and until he had become a full-

fledged member of a duly recognized farmers' cooperative." It was understood, however, that full payment of
the just compensation also had to be made first, conformably to the constitutional requirement.
When E.O. No. 228, categorically stated in its Section 1 that:
All qualified farmer-beneficiaries are now deemed full owners as of October 21, 1972 of the land they acquired
by virtue of Presidential Decree No. 27. (Emphasis supplied.)
it was obviously referring to lands already validly acquired under the said decree, after proof of full-fledged
membership in the farmers' cooperatives and full payment of just compensation. Hence, it was also perfectly
proper for the Order to also provide in its Section 2 that the "lease rentals paid to the landowner by the farmerbeneficiary after October 21, 1972 (pending transfer of ownership after full payment of just compensation),
shall be considered as advance payment for the land."
The CARP Law, for its part, conditions the transfer of possession and ownership of the land to the government
on receipt by the landowner of the corresponding payment or the deposit by the DAR of the compensation in
cash or LBP bonds with an accessible bank. Until then, title also remains with the landowner. 57 No outright
change of ownership is contemplated either.
Hence, the argument that the assailed measures violate due process by arbitrarily transferring title before the
land is fully paid for must also be rejected.
It is worth stressing at this point that all rights acquired by the tenant-farmer under P.D. No. 27, as recognized
under E.O. No. 228, are retained by him even now under R.A. No. 6657. This should counter-balance the
express provision in Section 6 of the said law that "the landowners whose lands 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."
In connection with these retained rights, it does not appear in G.R. No. 78742 that the appeal filed by the
petitioners with the Office of the President has already been resolved. Although we have said that the doctrine
of exhaustion of administrative remedies need not preclude immediate resort to judicial action, there are factual
issues that have yet to be examined on the administrative level, especially the claim that the petitioners are not
covered by LOI 474 because they do not own other agricultural lands than the subjects of their petition.
Obviously, the Court cannot resolve these issues. In any event, assuming that the petitioners have not yet
exercised their retention rights, if any, under P.D. No. 27, the Court holds that they are entitled to the new
retention rights provided for by R.A. No. 6657, which in fact are on the whole more liberal than those granted
by the decree.
V
The CARP Law and the other enactments also involved in these cases have been the subject of bitter attack
from those who point to the shortcomings of these measures and ask that they be scrapped entirely. To be
sure, these enactments are less than perfect; indeed, they should be continuously re-examined and rehoned,
that they may be sharper instruments for the better protection of the farmer's rights. But we have to start
somewhere. In the pursuit of agrarian reform, we do not tread on familiar ground but grope on terrain fraught
with pitfalls and expected difficulties. This is inevitable. The CARP Law is not a tried and tested project. On the
contrary, to use Justice Holmes's words, "it is an experiment, as all life is an experiment," and so we learn as
we venture forward, and, if necessary, by our own mistakes. We cannot expect perfection although we should
strive for it by all means. Meantime, we struggle as best we can in freeing the farmer from the iron shackles
that have unconscionably, and for so long, fettered his soul to the soil.
By the decision we reach today, all major legal obstacles to the comprehensive agrarian reform program are
removed, to clear the way for the true freedom of the farmer. We may now glimpse the day he will be released
not only from want but also from the exploitation and disdain of the past and from his own feelings of
inadequacy and helplessness. At last his servitude will be ended forever. At last the farm on which he toils will
be his farm. It will be his portion of the Mother Earth that will give him not only the staff of life but also the joy of
living. And where once it bred for him only deep despair, now can he see in it the fruition of his hopes for a
more fulfilling future. Now at last can he banish from his small plot of earth his insecurities and dark
resentments and "rebuild in it the music and the dream."
WHEREFORE, the Court holds as follows:
1.
R.A. No. 6657, P.D. No. 27, Proc. No. 131, and E.O. Nos. 228 and 229 are SUSTAINED against all the
constitutional objections raised in the herein petitions.
2. Title to all expropriated properties shall be transferred to the State only upon full payment of compensation
to their respective owners.
3. All rights previously acquired by the tenant- farmers under P.D. No. 27 are retained and recognized.

4. Landowners who were unable to exercise their rights of retention under P.D. No. 27 shall enjoy the retention
rights granted by R.A. No. 6657 under the conditions therein prescribed.
5. Subject to the above-mentioned rulings all the petitions are DISMISSED, without pronouncement as to
costs.
SO ORDERED.
Fernan, (C.J.), Narvasa, Melencio-Herrera, Gutierrez, Jr., Paras, Feliciano, Gancayco, Padilla, Bidin,
Sarmiento, Cortes, Grio-Aquino, Medialdea and Regalado, JJ., concur.

EN BANC
ROXAS & COMPANY, INC.,
Petitioner,
- versus DAMBA-NFSW and the DEPARTMENT OF AGRARIAN REFORM,*
Respondents.
x------------------------------------x
DAMAYAN NG MGA MANGGAGAWANG BUKID SA ASYENDA ROXAS-NATIONAL FEDERATION OF
SUGAR WORKERS (DAMBA-NFSW),
Petitioner,
- versus SECRETARY OF THE DEPT. OF AGRARIAN REFORM, ROXAS & Co., INC. AND/OR ATTY. MARIANO
AMPIL,
Respondents.
x-----------------------------------x

KATIPUNAN NG MGA MAGBUBUKID SA HACIENDA ROXAS, INC. (KAMAHARI), rep. by its President
CARLITO CAISIP, and DAMAYAN NG MANGGAGAWANG BUKID SA ASYENDA ROXAS-NATIONAL
FEDERATION OF SUGAR WORKERS (DAMBA-NFSW), represnted by LAURO MARTIN,
Petitioners,
- versus SECRETARY OF THE DEPT. OF AGRARIAN REFORM, ROXAS & Co., INC.,
Respondents.
x------------------------------------------x
DEPARTMENT OF LAND REFORM, FORMERLY DEPARTMENT OF AGRARIAN REFORM (DAR),
Petitioner,

- versus ROXAS & CO, INC.,

Respondent.
x------------------------------------x
ROXAS & CO., INC.,
Petitioner,
- versus DAMBA-NFSW,
Respondent.
x------------------------------------x
DAMBA-NFSW REPRESENTED BY LAURO V. MARTIN,
Petitioner,
- versus ROXAS & CO., INC.,
Respondent.
x------------------------------------x
DAMBA-NFSW,
Petitioner,
- versus ROXAS & CO., INC.,
Respondent.
x----------------------------------------------------------------------------------------x
DECISION
CARPIO MORALES, J.
The main subject of the seven consolidated petitions is the application of petitioner Roxas & Co., Inc. (Roxas &
Co.) for conversion from agricultural to non-agricultural use of its three haciendas located in Nasugbu,
Batangas containing a total area of almost 3,000 hectares. The facts are not new, the Court having earlier
resolved intimately-related issues dealing with these haciendas. Thus, in the 1999 case of Roxas & Co., Inc. v.
Court of Appeals,[1] the Court presented the facts as follows:
. . . Roxas & Co. is a domestic corporation and is the registered owner of three haciendas, namely, Haciendas
Palico, Banilad and Caylaway, all located in the Municipality of Nasugbu, Batangas. Hacienda Palico is 1,024
hectares in area and is registered under Transfer Certificate of Title (TCT) No. 985. This land is covered by
Tax Declaration Nos. 0465, 0466, 0468, 0470, 0234 and 0354. Hacienda Banilad is 1,050 hectares in area,
registered under TCT No. 924 and covered by Tax Declaration Nos. 0236, 0237 and 0390. Hacienda
Caylaway is 867.4571 hectares in area and is registered under TCT Nos. T-44662, T-44663, T-44664 and T44665.
xxxx

On July 27, 1987, the Congress of the Philippines formally convened and took over legislative power from the
President. This Congress passed Republic Act No. 6657, the Comprehensive Agrarian Reform Law (CARL) of
1988. The Act was signed by the President on June 10, 1988 and took effect on June 15, 1988.
Before the laws effectivity, on May 6, 1988, [Roxas & Co.] filed with respondent DAR a voluntary offer to sell
[VOS] Hacienda Caylaway pursuant to the provisions of E.O. No. 229. Haciendas Palico and Banilad were
later placed under compulsory acquisition by DAR in accordance with the CARL.
xxxx
Nevertheless, on August 6, 1992, [Roxas & Co.], through its President, Eduardo J. Roxas, sent a letter to the
Secretary of DAR withdrawing its VOS of Hacienda Caylaway. The Sangguniang Bayan of Nasugbu,
Batangas allegedly authorized the reclassification of Hacienda Caylaway from agricultural to non-agricultural.
As a result, petitioner informed respondent DAR that it was applying for conversion of Hacienda Caylaway from
agricultural to other uses.
x x x x[2] (emphasis and underscoring supplied)
The petitions in G.R. Nos. 167540 and 167543 nub on the interpretation of Presidential Proclamation (PP)
1520 which was issued on November 28, 1975 by then President Ferdinand Marcos. The PP reads:
DECLARING THE MUNICIPALITIES OF MARAGONDON AND TERNATE IN CAVITE PROVINCE AND THE
MUNICIPALITY OF NASUGBU IN BATANGAS AS A TOURIST ZONE, AND FOR OTHER PURPOSES
WHEREAS, certain areas in the sector comprising the Municipalities of Maragondon and Ternate in Cavite
Province and Nasugbu in Batangas have potential tourism value after being developed into resort complexes
for the foreign and domestic market; and
WHEREAS, it is necessary to conduct the necessary studies and to segregate specific geographic areas for
concentrated efforts of both the government and private sectors in developing their tourism potential;
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested
in me by the Constitution, do hereby declare the area comprising the Municipalities of Maragondon and
Ternate in Cavite Province and Nasugbu in Batangas Province as a tourist zone under the administration and
control of the Philippine Tourism Authority (PTA) pursuant to Section 5 (D) of P.D. 564.
The PTA shall identify well-defined geographic areas within the zone with potential tourism value, wherein
optimum use of natural assets and attractions, as well as existing facilities and concentration of efforts and
limited resources of both government and private sector may be affected and realized in order to generate
foreign exchange as well as other tourist receipts.
Any duly established military reservation existing within the zone shall be excluded from this proclamation.
All proclamation, decrees or executive orders inconsistent herewith are hereby revoked or modified
accordingly. (emphasis and underscoring supplied).
The incidents which spawned the filing of the petitions in G.R. Nos. 149548, 167505, 167845, 169163 and
179650 are stated in the dissenting opinion of Justice Minita Chico-Nazario, the original draft of which was
made the basis of the Courts deliberations.
Essentially, Roxas & Co. filed its application for conversion of its three haciendas from argricultural to nonagricultural on the assumption that the issuance of PP 1520 which declared Nasugbu, Batangas as a tourism
zone, reclassified them to non-agricultural uses. Its pending application notwithstanding, the Department of
Agrarian Reform (DAR) issued Certificates of Land Ownership Award (CLOAs) to the farmer-beneficiaries in

the three haciendas including CLOA No. 6654 which was issued on October 15, 1993 covering 513.983
hectares, the subject of G.R. No. 167505.
The application for conversion of Roxas & Co. was the subject of the above-stated Roxas & Co., Inc. v. Court
of Appeals which the Court remanded to the DAR for the observance of proper acquisition proceedings. As
reflected in the above-quoted statement of facts in said case, during the pendency before the DAR of its
application for conversion following its remand to the DAR or on May 16, 2000, Roxas & Co. filed with the DAR
an application for exemption from the coverage of the Comprehensive Agrarian Reform Program (CARP) of
1988 on the basis of PP 1520 and of DAR Administrative Order (AO) No. 6, Series of 1994[3] which states that
all lands already classified as commercial, industrial, or residential before the effectivity of CARP no longer
need conversion clearance from the DAR.
It bears mentioning at this juncture that on April 18, 1982, the Sangguniang Bayan of Nasugbu enacted
Municipal Zoning Ordinance No. 4 (Nasugbu MZO No. 4) which was approved on May 4, 1983 by the Human
Settlements Regulation Commission, now the Housing and Land Use Regulatory Board (HLURB).
The records show that Sangguniang Bayan and Association of Barangay Captains of Nasugbu filed before this
Court petitions for intervention which were, however, denied by Resolution of June 5, 2006 for lack of standing.
[4]
After the seven present petitions were consolidated and referred to the Court en banc,[5] oral arguments were
conducted on July 7, 2009.
The core issues are:

1. Whether PP 1520 reclassified in 1975 all lands in the Maragondon-Ternate-Nasugbu tourism zone to nonagricultural use to exempt Roxas & Co.s three haciendas in Nasugbu from CARP coverage;
2. Whether Nasugbu MSO No. 4, Series of 1982 exempted certain lots in Hacienda Palico from CARP
coverage; and
3. Whether the partial and complete cancellations by the DAR of CLOA No. 6654 subject of G.R. No.
167505 is valid.
The Court shall discuss the issues in seriatim.
I.
PP 1520 DID NOT AUTOMATICALLY CONVERT THE AGRICULTURAL LANDS IN THE THREE
MUNICIPALITIES INCLUDING NASUGBU TO NON-AGRICULTURAL LANDS.
Roxas & Co. contends that PP 1520 declared the three municipalities as each constituting a tourism zone,
reclassified all lands therein to tourism and, therefore, converted their use to non-agricultural purposes.
To determine the chief intent of PP 1520, reference to the whereas clauses is in order. By and large, a
reference to the congressional deliberation records would provide guidance in dissecting the intent of
legislation. But since PP 1520 emanated from the legislative powers of then President Marcos during martial
rule, reference to the whereas clauses cannot be dispensed with.[6]
The perambulatory clauses of PP 1520 identified only certain areas in the sector comprising the [three
Municipalities that] have potential tourism value and mandated the conduct of necessary studies and the
segregation of specific geographic areas to achieve its purpose. Which is why the PP directed the Philippine
Tourism Authority (PTA) to identify what those potential tourism areas are. If all the lands in those tourism
zones were to be wholly converted to non-agricultural use, there would have been no need for the PP to direct
the PTA to identify what those specific geographic areas are.

The Court had in fact passed upon a similar matter before. Thus in DAR v. Franco,[7] it pronounced:
Thus, the DAR Regional Office VII, in coordination with the Philippine Tourism Authority, has to determine
precisely which areas are for tourism development and excluded from the Operation Land Transfer and the
Comprehensive Agrarian Reform Program. And suffice it to state here that the Court has repeatedly ruled that
lands already classified as non-agricultural before the enactment of RA 6657 on 15 June 1988 do not need any
conversion clearance.[8] (emphasis and underscoring supplied).
While the above pronouncement in Franco is an obiter, it should not be ignored in the resolution of the present
petitions since it reflects a more rational and just interpretation of PP 1520. There is no prohibition in
embracing the rationale of an obiter dictum in settling controversies, or in considering related proclamations
establishing tourism zones.
In the above-cited case of Roxas & Co. v. CA,[9] the Court made it clear that the power to determine
whether Haciendas Palico, Banilad and Caylaway are non-agricultural, hence, exempt from the coverage of
the [Comprehensive Agrarian Reform Law] lies with the [Department of Agrarian Reform], not with this
Court.[10] The DAR, an administrative body of special competence, denied, by Order of October 22, 2001,
the application for CARP exemption of Roxas & Co., it finding that PP 1520 did not automatically reclassify all
the lands in the affected municipalities from their original uses. It appears that the PTA had not yet, at that
time, identified the specific geographic areas for tourism development and had no pending tourism
development projects in the areas. Further, report from the Center for Land Use Policy Planning and
Implementation (CLUPPI) indicated that the areas were planted with sugar cane and other crops.[11]
Relatedly, the DAR, by Memorandum Circular No. 7, Series of 2004,[12] came up with clarificatory
guidelines and therein decreed that
A. x x x x.
B. Proclamations declaring general areas such as whole provinces, municipalities, barangays, islands or
peninsulas as tourist zones that merely:
(1) recognize certain still unidentified areas within the covered provinces, municipalities, barangays, islands, or
peninsulas to be with potential tourism value and charge the Philippine Tourism Authority with the task to
identify/delineate specific geographic areas within the zone with potential tourism value and to coordinate said
areas development; or
(2) recognize the potential value of identified spots located within the general area declared as tourist zone
(i.e. x x x x) and direct the Philippine Tourism Authority to coordinate said areas development;
could not be regarded as effecting an automatic reclassification of the entirety of the land area declared as
tourist zone. This is so because reclassification of lands denotes their allocation into some specific use and
providing for the manner of their utilization and disposition (Sec. 20, Local Government Code) or the act of
specifying how agricultural lands shall be utilized for non-agricultural uses such as residential, industrial, or
commercial, as embodied in the land use plan. (Joint HLURB, DAR, DA, DILG Memo. Circular Prescribing
Guidelines for MC 54, S. 1995, Sec.2)
A proclamation that merely recognizes the potential tourism value of certain areas within the general
area declared as tourist zone clearly does not allocate, reserve, or intend the entirety of the land area of the
zone for non-agricultural purposes. Neither does said proclamation direct that otherwise CARPable lands
within the zone shall already be used for purposes other than agricultural.
Moreover, to view these kinds of proclamation as a reclassification for non-agricultural purposes of
entire provinces, municipalities, barangays, islands, or peninsulas would be unreasonable as it amounts to an
automatic and sweeping exemption from CARP in the name of tourism development. The same would also

undermine the land use reclassification powers vested in local government units in conjunction with pertinent
agencies of government.
C. There being no reclassification, it is clear that said proclamations/issuances, assuming [these] took effect
before June 15, 1988, could not supply a basis for exemption of the entirety of the lands embraced therein
from CARP coverage x x x x.
D. x x x x. (underscoring in the original; emphasis and italics supplied)
The DARs reading into these general proclamations of tourism zones deserves utmost consideration, more
especially in the present petitions which involve vast tracts of agricultural land. To reiterate, PP 1520 merely
recognized the potential tourism value of certain areas within the general area declared as tourism zones. It
did not reclassify the areas to non-agricultural use.
Apart from PP 1520, there are similarly worded proclamations declaring the whole of Ilocos Norte and Bataan
Provinces, Camiguin, Puerto Prinsesa, Siquijor, Panglao Island, parts of Cebu City and Municipalities of Argao
and Dalaguete in Cebu Province as tourism zones.[13]
Indubitably, these proclamations, particularly those pertaining to the Provinces of Ilocos Norte and Bataan, did
not intend to reclassify all agricultural lands into non-agricultural lands in one fell swoop. The Court takes
notice of how the agrarian reform program wasand still isimplemented in these provinces since there are
lands that do not have any tourism potential and are more appropriate for agricultural utilization.
Relatedly, a reference to the Special Economic Zone Act of 1995[14] provides a parallel orientation on the
issue. Under said Act, several towns and cities encompassing the whole Philippines were readily identified as
economic zones.[15] To uphold Roxas & Co.s reading of PP 1520 would see a total reclassification of
practically all the agricultural lands in the country to non-agricultural use. Propitiously, the legislature had the
foresight to include a bailout provision in Section 31 of said Act for land conversion.[16] The same cannot be
said of PP 1520, despite the existence of Presidential Decree (PD) No. 27 or the Tenant Emancipation Decree,
[17] which is the precursor of the CARP.
Interestingly, then President Marcos also issued on September 26, 1972 PD No. 2 which declared the entire
Philippines as land reform area.[18] Such declaration did not intend to reclassify all lands in the entire country
to agricultural lands. President Marcos, about a month later or on October 21, 1972, issued PD 27 which
decreed that all private agricultural lands primarily devoted to rice and corn were deemed awarded to their
tenant-farmers.
Given these martial law-era decrees and considering the socio-political backdrop at the time PP 1520 was
issued in 1975, it is inconceivable that PP 1520, as well as other similarly worded proclamations which are
completely silent on the aspect of reclassification of the lands in those tourism zones, would nullify the gains
already then achieved by
PD 27.
Even so, Roxas & Co. turns to Natalia Realty v. DAR and NHA v. Allarde to support its position. These cases
are not even closely similar to the petitions in G.R. Nos. 167540 and 167543. The only time that these cases
may find application to said petitions is when the PTA actually identifies well-defined geographic areas within
the zone with potential tourism value.
In remotely tying these two immediately-cited cases that involve specific and defined townsite reservations for
the housing program of the National Housing Authority to the present petitions, Roxas & Co. cites Letter of
Instructions No. 352 issued on December 22, 1975 which states that the survey and technical description of
the tourism zones shall be considered an integral part of PP 1520. There were, however, at the time no
surveys and technical delineations yet of the intended tourism areas.

On hindsight, Natalia and Allarde find application in the petitions in G.R. Nos. 179650 & 167505, which
petitions are anchored on the extenuating effects of Nasugbu MZO No. 4, but not in the petitions in G.R. Nos.
167540 & 167543 bearing on PP 1520, as will later be discussed.
Of significance also in the present petitions is the issuance on August 3, 2007 of Executive Order No. 647[19]
by President Arroyo which proclaimed the areas in the Nasugbu Tourism Development Plan as Special Tourism
Zone. Pursuant to said Executive Order, the PTA completed its validation of 21 out of 42 barangays as tourism
priority areas, hence, it is only after such completion that these identified lands may be subjected to
reclassification proceedings.
It bears emphasis that a mere reclassification of an agricultural land does not automatically allow a landowner
to change its use since there is still that process of conversion before one is permitted to use it for other
purposes.[20]
Tourism Act, and not to PP 1520, for possible exemption.
II.
ROXAS & CO.S APPLICATION IN DAR ADMINISTRATIVE CASE NO. A-9999-142-97 FOR CARP
EXEMPTION IN HACIENDA PALICO SUBJECT OF G.R. NO. 179650 CANNOT BE GRANTED IN VIEW OF
DISCREPANCIES IN THE LOCATION AND IDENTITY OF THE SUBJECT PARCELS OF LAND.
Since PP 1520 did not automatically convert Haciendas Caylaway, Banilad and Palico into non-agricultural
estates, can Roxas & Co. invoke in the alternative Nasugbu MZO No. 4, which reclassified in 1982 the
haciendas to non-agricultural use to exclude six parcels of land in Hacienda Palico from CARP coverage?
By Roxas & Co.s contention, the affected six parcels of land which are the subject of DAR Administrative Case
No. A-9999-142-97 and nine parcels of land which are the subject of DAR Administrative Case No.
A-9999008-98 involved in G.R. No. 167505, all in Hacienda Palico, have been reclassified to non-agricultural uses via
Nasugbu MZO No. 4 which was approved by the forerunner of HLURB.
Roxas & Co.s contention fails.
To be sure, the Court had on several occasions decreed that a local government unit has the power to classify
and convert land from agricultural to non-agricultural prior to the effectivity of the CARL.[23] In Agrarian
Reform Beneficiaries Association v. Nicolas,[24] it reiterated that
. . . the facts obtaining in this case are similar to those in Natalia Realty. Both subject lands form part of an
area designated for non-agricultural purposes. Both were classified as non-agricultural lands prior to June 15,
1988, the date of effectivity of CARL.
xxxx
In the case under review, the subject parcels of lands were reclassified within an urban zone as per approved
Official Comprehensive Zoning Map of the City of Davao. The reclassification was embodied in City Ordinance
No. 363, Series of 1982. As such, the subject parcels of land are considered non-agricultural and may be
utilized for residential, commercial, and industrial purposes. The reclassification was later approved by the
HLURB.[25] (emphasis, italics and underscoring supplied)
The DAR Secretary[26] denied the application for exemption of Roxas & Co., however, in this wise:
Initially, CLUPPI-2 based [its] evaluation on the lot nos. as appearing in CLOA No. 6654. However, for
purposes of clarity and to ensure that the area applied for exemption is indeed part of TCT No. T-60034,
CLUPPI-2 sought to clarify with [Roxas & Co.] the origin of TCT No. T-60034. In a letter dated May 28, 1998,
[Roxas & Co.] explains that portions of TCT No. T-985, the mother title, was subdivided into 125 lots
pursuant to PD 27. A total of 947.8417 was retained by the landowners and was subsequently registered

under TCT No. 49946. [[Roxas & Co.] further explains that TCT No. 49946 was further subdivided into several
lots (Lot 125-A to Lot 125-P) with Lot No. 125-N registered under TCT No. 60034. [A] review of the titles,
however, shows that the origin of T-49946 is T-783 and not T-985. On the other hand, the origin of T-60034 is
listed as 59946, and not T-49946. The discrepancies were attributed by [Roxas & Co.] to typographical errors
which were acknowledged and initialled [sic] by the ROD. Per verification, the discrepancies . . . cannot
be ascertained.[27] (emphasis and underscoring supplied)
In denying Roxas & Co.s motion for reconsideration, the DAR Secretary held:
The landholdings covered by the aforesaid titles do not correspond to the Certification dated February 11, 1998
of the [HLURB] , the Certification dated September 12, 1996 issued by the Municipal Planning and
Development Coordinator, and the Certifications dated July 31, 1997 and May 27, 1997 issued by the National
Irrigation Authority. The certifications were issued for Lot Nos. 21, 24, 28, 31, 32 and 34. Thus, it was not even
possible to issue exemption clearance over the lots covered by TCT Nos. 60019 to 60023.
Furthermore, we also note the discrepancies between the certifications issued by the HLURB and the
Municipal Planning Development Coordinator as to the area of the specific lots.[28] (emphasis and
underscoring supplied)
In affirming the DAR Secretarys denial of Roxas & Co.s application for exemption, the Court of Appeals, in
CA-G.R. SP No. 63146 subject of G.R. No. 179650, observed:
In the instant case, a perusal of the documents before us shows that there is no indication that the said TCTs
refer to the same properties applied for exemption by [Roxas & Co.] It is true that the certifications refer,
among others, to DAR Lot Nos. 21, 24, 28, 31, 32 and 34But these certifications contain nothing to show that
these lots are the same as Lots 125-A, 125-B, 125-C, 125-D and 125-E covered by TCT Nos. 60019, 60020,
60021, 60022 and 60023, respetively. While [Roxas & Co.] claims that DAR Lot Nos. 21, 24 and 31
correspond to the aforementioned TCTs submitted to the DAR no evidence was presented to substantiate such
allegation.
Moreover, [Roxas & Co.] failed to submit TCT 634 which it claims covers DAR Lot Nos. 28, 32 and 24.(TSN,
April 24, 2001, pp. 43-44)
xxxx
[Roxas & Co.] also claims that subject properties are located at Barangay Cogunan and Lumbangan and that
these properties are part of the zone classified as Industrial under Municipal Ordinance No. 4, Series of 1982
of the Municipality of Nasugbu, Batangas. .a scrutiny of the said Ordinance shows that only Barangays
Talangan and Lumbangan of the said municipality were classified as Industrial ZonesBarangay Cogunan
was not included. x x x x. In fact, the TCTs submitted by [Roxas & Co.] show that the properties covered by
said titles are all located at Barrio Lumbangan.[29] (emphasis and underscoring supplied)
Its foregoing findings notwithstanding, the appellate court still allowed Roxas & Co. to adduce additional
evidence to support its application for exemption under Nasugbu MZO No. 4.
Meanwhile, Roxas & Co. appealed the appellate courts decision in CA-G.R. No. SP No. 63146 affirming the
DAR Secretarys denial of its application for CARP exemption in Hacienda Palico (now the subject of G.R. No.
149548).
When Roxas & Co. sought the re-opening of the proceedings in DAR Administrative Case No. A-9999-142-97
(subject of G.R. No. 179650), and offered additional evidence in support of its application for CARP exemption,
the DAR Secretary, this time, granted its application for the six lots including Lot No. 36 since the additional
documents offered by Roxas & Co. mentioned the said lot.

In granting the application, the DAR Secretary[30] examined anew the evidence submitted by Roxas & Co.
which consisted mainly of certifications from various local and national government agencies.[31] Petitioner in
G.R. Nos. 167505, 167540, 169163 and 179650, Damayan Ng Mga Manggagawang Bukid Sa Asyenda
Roxas-National Federation of Sugar Workers (DAMBA-NFSW), the organization of the farmer-beneficiaries,
moved to have the grant of the application reconsidered but the same was denied by the DAR by Order of
December 12, 2003, hence, it filed a petition for certiorari before the Court of Appeals, docketed as CA-G.R.
SP No. 82225, on grounds of forum-shopping and grave abuse of discretion. The appellate court, by Decision
of October 31, 2006, ruled that DAMBA-NFSW availed of the wrong mode of appeal. At all events, it dismissed
its petition as it upheld the DAR Secretarys ruling that Roxas & Co. did not commit forum-shopping, hence, the
petition of DAMBA-NGSW in G.R. No. 179650.
While ordinarily findings of facts of quasi-judicial agencies are generally accorded great weight and even
finality by the Court if supported by substantial evidence in recognition of their expertise on the specific matters
under their consideration,[32] this legal precept cannot be made to apply in G.R. No. 179650.
Even as the existence and validity of Nasugbu MZO No. 4 had already been established, there remains in
dispute the issue of whether the parcels of land involved in DAR Administrative Case No. A-9999-142-97
subject of G.R. No. 179650 are actually within the said zoning ordinance.
The Court finds that the DAR Secretary indeed committed grave abuse of discretion when he ignored the
glaring inconsistencies in the certifications submitted early on by Roxas & Co. in support of its application vis-vis the certifications it later submitted when the DAR Secretary reopened DAR Administrative Case No. A9999-142-97.
Notably, then DAR Secretary Horacio Morales, on one hand, observed that the landholdings covered by the
aforesaid titles do not correspond to the Certification dated February 11, 1998 of the [HLURB], the Certification
dated September 12, 1996 issued by the Municipal Planning and Development Coordinator, and the
Certifications dated July 31, 1997 and May 27, 1997 issued by the National Irrigation Authority. On the other
hand, then Secretary Hernani Braganza relied on a different set of certifications which were issued later or on
September 19, 1996.
In this regard, the Court finds in order the observation of DAMBA-NFSW that Roxas & Co. should have
submitted the comprehensive land use plan and pointed therein the exact locations of the properties to prove
that indeed they are within the area of coverage of Nasugbu MZO No. 4.
The petitions in G.R. Nos. 179650 & 149548 must be distinguished from Junio v. Garilao[33] wherein the
certifications submitted in support of the application for exemption of the therein subject lot were mainly
considered on the presumption of regularity in their issuance, there being no doubt on the location and identity
of the subject lot.[34] In G.R. No. 179650, there exist uncertainties on the location and identities of the
properties being applied for exemption.
G.R. No. 179650 & G.R. No. 149548 must accordingly be denied for lack of merit.
III. ROXAS & CO.S APPLICATION FOR CARP EXEMPTION IN DAR ADMINISTRATIVE CASE NO. A-9999008-98 FOR THE NINE PARCELS OF LAND IN HACIENDA PALICO SUBJECT OF G.R. NO. 167505
SHOULD BE GRANTED.
The Court, however, takes a different stance with respect to Roxas & Co.s application for CARP exemption in
DAR Administrative Case No. A-9999-008-98 over nine parcels of land identified as Lot Nos. 20, 13, 37, 19-B,
45, 47, 49, 48-1 and 48-2 which are portions of TCT No. 985 covering 45.9771 hectares in Hacienda Palico,
subject of G.R. No. 167505.
In its application, Roxas & Co. submitted the following documents:

1.
Letter-application dated 29 September 1997 signed by Elino SJ. Napigkit, for and on behalf of Roxas &
Company, Inc., seeking exemption from CARP coverage of subject landholdings;
2.
Secretarys Certificate dated September 2002 executed by Mariano M. Ampil III, Corporate Secretary of
Roxas & Company, Inc., indicating a Board Resolution authorizing him to represent the corporation in its
application for exemption with the DAR. The same Board Resolution revoked the authorization previously
granted to the Sierra Management & Resources Corporation;
3.

Photocopy of TCT No. 985 and its corresponding Tax Declaration No. 0401;

4.

Location and vicinity maps of subject landholdings;

5.
Certification dated 10 July 1997 issued by Reynaldo Garcia, Municipal Planning and Development
Coordinator (MPDC) and Zoning Administrator of Nasugbu, Batangas, stating that the subject parcels of land
are within the Urban Core Zone as specified in Zone A. VII of Municipal Zoning Ordinance No. 4, Series of
1982, approved by the Human Settlements Regulatory Commission (HSRC), now the Housing and Land Use
Regulatory Board (HLURB), under Resolution No. 123, Series of 1983, dated 4 May 1983;
6.
Two (2) Certifications both dated 31 August 1998, issued by Alfredo Tan II, Director, HLURB, Region IV,
stating that the subject parcels of land appear to be within the Residential cluster Area as specified in Zone VII
of Municipal Zoning Ordinance No. 4, Series of 1982, approved under HSRC Resolution No. 123, Series of
1983, dated 4 May 1983;[35]
x x x x (emphasis and underscoring supplied)
By Order of November 6, 2002, the DAR Secretary granted the application for exemption but issued the
following conditions:
1.
The farmer-occupants within subject parcels of land shall be maintained in their peaceful possession and
cultivation of their respective areas of tillage until a final determination has been made on the amount of
disturbance compensation due and entitlement of such farmer-occupants thereto by the PARAD of Batangas;
2.
No development shall be undertaken within the subject parcels of land until the appropriate disturbance
compensation has been paid to the farmer-occupants who are determined by the PARAD to be entitled thereto.
Proof of payment of disturbance compensation shall be submitted to this Office within ten (10) days from such
payment; and
3.
The cancellation of the CLOA issued to the farmer-beneficiaries shall be subject of a separate proceeding
before the PARAD of Batangas.[36]
DAMBA-NSFW moved for reconsideration but the DAR Secretary denied the same and explained further why
CLOA holders need not be informed of the pending application for exemption in this wise:
As regards the first ground raised by [DAMBA-NSFW], it should be remembered that an application for CARPexemption pursuant to DOJ Opinion No. 44, series of 1990, as implemented by DAR Administrative Order No.
6, series of 1994, is non-adversarial or non-litigious in nature. Hence, applicant is correct in saying that
nowhere in the rules is it required that occupants of a landholding should be notified of an initiated or pending
exemption application.
xxxx

With regard [to] the allegation that oppositors-movants are already CLOA holders of subject propert[ies] and
deserve to be notified, as owners, of the initiated questioned exemption application, is of no moment. The
Supreme Court in the case of Roxas [&] Co., Inc. v. Court of Appeals, 321 SCRA 106, held:
We stress that the failure of respondent DAR to comply with the requisites of due process in the acquisition
proceedings does not give this Court the power to nullify the CLOAs already issued to the farmer beneficiaries.
x x x x. Anyhow, the farmer[-]beneficiaries hold the property in trust for the rightful owner of the land.
Since subject landholding has been validly determined to be CARP-exempt, therefore, the previous issuance
of the CLOA of oppositors-movants is erroneous. Hence, similar to the situation of the above-quoted Supreme
Court Decision, oppositors-movants only hold the property in trust for the rightful owners of the land and are
not the owners of subject landholding who should be notified of the exemption application of applicant Roxas &
Company, Incorporated.
Finally, this Office finds no substantial basis to reverse the assailed Orders since there is substantial
compliance by the applicant with the requirements for the issuance of exemption clearance under DAR AO 6
(1994).[37]
On DAMBA-NSFWs petition for certiorari, the Court of Appeals, noting that the petition was belatedly
filed, sustained, by Decision of December 20, 1994 and Resolution of May 7, 2007,[38] the DAR Secretarys
finding that Roxas & Co. had substantially complied with the prerequisites of DAR AO 6, Series of 1994.
Hence, DAMBA-NFSWs petition in G.R. No. 167505.
The Court finds no reversible error in the Court of Appeals assailed issuances, the orders of the DAR
Secretary which it sustained being amply supported by evidence.

IV. THE CLOAs ISSUED BY THE DAR in ADMINISTRATIVE CASE NO. A-9999-008-98 SUBJECT OF G.R.
No. 179650 TO THE FARMER-BENEFICIARIES INVOLVING THE NINE PARCELS OF LAND IN HACIENDA
PALICO MUST BE CANCELLED.
Turning now to the validity of the issuance of CLOAs in Hacienda Palico vis--vis the present dispositions: It
bears recalling that in DAR Administrative Case Nos. A-9999-008-98 and A-9999-142-97 (G.R. No. 179650),
the Court ruled for Roxas & Co.s grant of exemption in DAR Administrative Case No. A-9999-008-98 but
denied the grant of exemption in DAR Administrative Case No. A-9999-142-97 for reasons already discussed.
It follows that the CLOAs issued to the farmer-beneficiaries in DAR Administrative Case No. A-9999-008-98
must be cancelled.
But first, the Court digresses. The assertion of DAMBA-NSFW that the petitions for partial and complete
cancellations of the CLOAs subject of DARAB Case Nos. R-401-003-2001 to R-401-005-2001 and No. 401239-2001 violated the earlier order in Roxas v. Court of Appeals does not lie. Nowhere did the Court therein
pronounce that the CLOAs issued cannot and should not be cancelled, what was involved therein being the
legality of the acquisition proceedings. The Court merely reiterated that it is the DAR which has primary
jurisdiction to rule on the validity of CLOAs. Thus it held:
. . . [t]he failure of respondent DAR to comply with the requisites of due process in the acquisition proceedings
does not give this Court the power to nullify the [CLOAs] already issued to the farmer-beneficiaries. To
assume the power is to short-circuit the administrative process, which has yet to run its regular course.
Respondent DAR must be given the chance to correct its procedural lapses in the acquisition proceedings. x x
x x. Anyhow, the farmer beneficiaries hold the property in trust for the rightful owner of the land.[39]

On the procedural question raised by Roxas & Co. on the appellate courts relaxation of the rules by giving due
course to DAMBA-NFSWs appeal in CA G.R. SP No. 72198, the subject of G.R. No. 167845:
Indeed, the perfection of an appeal within the statutory period is jurisdictional and failure to do so renders the
assailed decision final and executory.[40] A relaxation of the rules may, however, for meritorious reasons, be
allowed in the interest of justice.[41] The Court finds that in giving due course to DAMBA-NSFWs appeal, the
appellate court committed no reversible error. Consider its ratiocination:
x x x x. To deny [DAMBA-NSFW]s appeal with the PARAD will not only affect their right over the parcel of land
subject of this petition with an area of 103.1436 hectares, but also that of the whole area covered by CLOA No.
6654 since the PARAD rendered a Joint Resolution of the Motion for Reconsideration filed by the [DAMBANSFW] with regard to [Roxas & Co.]s application for partial and total cancellation of the CLOA in DARAB
Cases No. R-401-003-2001 to R-401-005-2001 and No. 401-239-2001. There is a pressing need for an
extensive discussion of the issues as raised by both parties as the matter of canceling CLOA No. 6654 is of
utmost importance, involving as it does the probable displacement of hundreds of farmer-beneficiaries and
their families. x x x x (underscoring supplied)
Unlike courts of justice, the DARAB, as a quasi-judicial body, is not bound to strictly observe rules of procedure
and evidence. To strictly enforce rules on appeals in this case would render to naught the Courts dispositions
on the other issues in these consolidated petitions.
In the main, there is no logical recourse except to cancel the CLOAs issued for the nine parcels of land
identified as Lot Nos. 20, 13, 37, 19-B, 45, 47, 49, 48-1 and 48-2 which are portions of TCT No. 985 covering
45.9771 hectares in Hacienda Palico (or those covered by DAR Administrative Case No. A-9999-008-98). As
for the rest of the CLOAs, they should be respected since Roxas & Co., as shown in the discussion in G.R.
Nos. 167540, 167543 and 167505, failed to prove that the other lots in Hacienda Palico and the other two
haciendas, aside from the above-mentioned nine lots, are CARP-exempt.
Conformably, Republic Act No. 3844 (R.A. No. 3844), as amended,[42] mandates that disturbance
compensation be given to tenants of parcels of land upon finding that (t)he landholding is declared by the
department head upon recommendation of the National Planning Commission to be suited for residential,
commercial, industrial or some other urban purposes.[43] In addition, DAR AO No. 6, Series of 1994 directs
the payment of disturbance compensation before the application for exemption may be completely granted.
Roxas & Co. is thus mandated to first satisfy the disturbance compensation of affected farmer-beneficiaries in
the areas covered by the nine parcels of lands in DAR AO No. A-9999-008-98 before the CLOAs covering
them can be cancelled. And it is enjoined to strictly follow the instructions of R.A. No. 3844.
Finally then, and in view of the Courts dispositions in G.R. Nos. 179650 and 167505, the May 27, 2001
Decision of the Provincial Agrarian Reform Adjudicator (PARAD)[44] in DARAB Case No. 401-239-2001
ordering the total cancellation of CLOA No. 6654, subject of G.R. No. 169163, is SET ASIDE except with
respect to the CLOAs issued for Lot Nos. 20, 13, 37, 19-B, 45, 47, 49, 48-1 and 48-2 which are portions of TCT
No. 985 covering 45.9771 hectares in Hacienda Palico (or those covered by DAR Administrative Case No. A9999-008-98). It goes without saying that the motion for reconsideration of DAMBA-NFSW is granted to thus
vacate the Courts October 19, 2005 Resolution dismissing DAMBA-NFSWs petition for review of the appellate
courts Decision in CA-G.R. SP No. 75952;[45]
WHEREFORE,
1) In G.R. No. 167540, the Court REVERSES and SETS ASIDE the November 24, 2003 Decision[46] and
March 18, 2005 Resolution of the Court of Appeals in CA-G.R. SP No. 72131 which declared that Presidential
Proclamation No. 1520 reclassified the lands in the municipalities of Nasugbu in Batangas and Maragondon
and Ternate in Cavite to non-agricultural use;

2) The Court accordingly GRANTS the Motion for Reconsideration of the Department of Agrarian Reform in
G.R. No. 167543 and REVERSES and SETS ASIDE its Resolution of July 20, 2005;
3) In G.R. No. 149548, the Court DENIES the petition for review of Roxas & Co. for lack of merit;
4) In G.R. No. 179650, the Court GRANTS the petition for review of DAMBA-NSFW and REVERSES and
SETS ASIDE the October 31, 2006 Decision and August 16, 2007 Resolution of the Court of Appeals in CAG.R. SP No. 82225;
5) In G.R. No. 167505, the Court DENIES the petition for review of DAMBA-NSFW and AFFIRMS the
December 20, 2004 Decision and March 7, 2005 Resolution of the Court of Appeals in CA-G.R. SP No. 82226;
6) In G.R. No. 167845, the Court DENIES Roxas & Co.s petition for review for lack of merit and AFFIRMS the
September 10, 2004 Decision and April 14, 2005 Resolution of the Court of Appeals;
7) In G.R. No. 169163, the Court SETS ASIDE the Decisions of the Provincial Agrarian Reform Adjudicator in
DARAB Case No. 401-239-2001 ordering the cancellation of CLOA No. 6654 and DARAB Cases Nos. R-401003-2001 to No. R-401-005-2001 granting the partial cancellation of CLOA No. 6654. The CLOAs issued for
Lots No. 21 No. 24, No. 26, No. 31, No. 32 and No. 34 or those covered by DAR Administrative Case No. A9999-142-97) remain; and
8) Roxas & Co. is ORDERED to pay the disturbance compensation of affected farmer-beneficiaries in the
areas covered by the nine parcels of lands in DAR Administrative Case No. A-9999-008-98 before the CLOAs
therein can be cancelled, and is ENJOINED to strictly follow the mandate of R.A. No. 3844.
No pronouncement as to costs.
SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 76182
March 11, 1991
PEDRO M. BELEN, petitioner,
vs.
COURT OF APPEALS and ALFREDO JULIANO and all the members of his family, respondents.
Teofilo C. Villarico for petitioner.
Bernardo V. Valdez for private respondent.
NARVASA, J.:p
A small portion of land measuring a hundred (100) square meters, more or less, belonging to the Manotoc
Services, Inc. was leased to Pedro M. Belen. That piece of land is known as Lot No. 10, Block 18 and is
situated at Sunog Apog, Tondo, Manila. 1 On it stood a house built by Belen.
Part of the land came to be occupied by Alfredo Juliano and his family in the early part of 1978; Juliano bought
a house standing thereon, not belonging to Belen, and moved in without the latter's knowledge. 2 On learning
of this, Belen had a talk with Juliano, and they came to an agreement that Juliano could continue staying on
the land temporarily and would pay one-half of the rental to Manotok Realty, Inc. Later a fire razed both Belen's
and Juliano's houses to the ground. Belen told Juliano not to build anything on the land any more. However, on
Juliano's pleas, Belen acceded to Juliano's continued stay on the land on the explicit condition that his
occupancy should not be longer than two and a half (2 1/2) years. 3 When Juliano failed to leave the premises
after the stipulated term despite demand, Belen brought suit in the Metropolitan Trial Court sometime in
September, 1982, 4 and succeeded in obtaining judgment dated September 5, 1984 5 disposing as follows:
WHEREFORE, judgment is hereby rendered as follows:

1)
Ordering defendant and all persons claiming rights and/or title under him to vacate the subject lot he is
presently occupying at 2805 Javier Street, Gagalangin, Tondo, Manila, and to surrender possession thereof to
herein plaintiff,
2)
Ordering defendant to pay plaintiff the amount of P3,000.00 as and for attorney's fees, plus costs of
suit.
Juliano appealed to the Regional Trial Court of Manila. That Court reversed the judgment of the Metropolitan
Trial Court. The decision rendered on June 26, 1985, 6 was made to rest on the expropriation of the Manotok
Estate effected by Presidential Decree No. 1670, and declared that
PD No. 1670 . . . has expropriated real property along the Estero de Sunog-Apog, Tondo, Manila . . . formerly
owned by the Manotok Realty, Inc. . . . The decree was signed on January 28, 1980. The government has
started to implement the expropriation (See Exhibit "2," p. 7; 2, rec.). . . . Alfredo Juliano is a prospective
beneficiary of the Bliss Project being undertaken by the National Housing Authority at the site in question (See
Exhibits "2-B" and "3"). Therefore, when the complaint in this case was filed on September 13, 1982, . . .
Manotok Realty Services, Inc. was no longer the owner of the premises in question and as correctly contended
by defendants-appellants, the relation between plaintiff-appellee and defendants-appellants were also deemed
terminated.
Accordingly, the decision appealed from was set aside and another entered "dismissing the complaint filed in
the court a quo . . . (without) pronouncement as to costs."
Belen seasonably filed with the Court of Appeals a petition for review of the decision of the Manila Regional
Trial Court. His appeal was docketed as CA-G.R. SP No. 06589 and after due proceedings, resolved against
him by Decision promulgated on October 2, 1986. 7 The Appellate Court took account of Presidential Decree
No. 1670 as the decisive factor in determining the "pivotal and decisive issue whether Manotok Realty, Inc.,
petitioner's lessor, has retained ownership of the lot in question, the expropriating law invoked by private
respondent (PD 1670) notwithstanding." The Court specifically adverted to Section 1 of the decree, viz.:
Sec. 1.
The real property along the Estero de Sunog-Apog in Tondo, Manila, formerly consisting of Lots
Nos. 55-A, 55-B and 55-C, Block 2918 of the subdivision plan Psd-11746, covered by TCT Nos. 49286, 49287
and 49288, respectively, of the Registry of Deeds of Manila, and formerly owned by the Manotok Realty, Inc.,
with an area of 72,428.6 square meters, more or less, is hereby declared expropriated. The National Housing
Authority hereinafter referred to as the "Authority" is designated administrator of the National Government with
authority to immediately take possession, control and disposition, with the power of demolition of the
expropriated properties and their improvements and shall evolve and implement a comprehensive
development plan for the condemned properties.
The decision declared that by virtue of the decree, Manotok Realty, Inc. ceased to be the owner of the land,
including the lot leased to Belen, and could not interfere with the possession, administration, control and
disposition of the National Housing Authority (NHA); its only right being to claim the just compensation thereof;
that as a result, Manotok's lease contract with Belen over the lot in question also ipso facto ended, as well as
the sublease between Belen and Juliano, since a sublease can never extend beyond the duration of the
sublessor's lease of the sublessor; that, consequently, neither Manotok Realty, Inc. nor Belen could judicially
eject Juliano from the disputed lot; and that under said P.D. 1670, the fate of Juliano and the other actual
occupants of the property was within the competence of the National Housing Authority to determine; indeed,
Juliano has been "duly certified by the Project OIC of the Sunog-Apog Urban Bliss as among the structure
owners per 1980 census conducted by the NHA under its Zonal Improvement Program for Metro Manila . . .
(and was hence) a prospective beneficiary of said project."
Belen has perfected an appeal by certiorari to this Court and prays for reversal of the judgment of the Court of
Appeals and the rendition of a new decision granting him the relief originally prayed for in his complaint in the
Manila Metropolitan Trial Court. He prays for judgment on the following essential propositions:
1)
PD 1670 notwithstanding, Manotok Realty Services, Inc. had not been divested of its title as of August,
1983, it not having "received any money as payment for the subject property," and the NHA not having taken
possession thereof in an appropriate action of eminent domain (Tuason & Co., Inc. vs. Land Tenure
Administration etc., 49 SCRA 338);
2)
in any event, it is Belen, not Juliano, who is entitled to be declared a rightful occupant of the land and
exercise the rights under PD 1670.
The petition will be granted and the challenged judgment of the Court of Appeals, reversed.
Presidential Decree No. 1670, together with a companion decree, numbered 1669 which attempted to
expropriate by similar legislative fiat another property, the so-called "Tambunting Estate" was struck down
by this Court as "unconstitutional and therefore, null and void," on May 21, 1987 in a joint judgment rendered in

G.R. No. 55166 (Manotok, et al. v. National Housing Authority, et al.) and G.R. No. 55167 (Tiongson, et al. v.
National Housing Authority, et al). 8 The Court found that both the decrees, being "violative of the petitioners'
(owners') right to due process of law," failed "the test of constitutionality," and that, additionally, they were
tainted by another infirmity as regards "the determination of just compensation."
The Court said:
The decrees do not by themselves, provide for any form of hearing or procedure by which the petitioners can
question the propriety of the expropriation of their properties or the reasonableness of the just compensation.
Having failed to provide for a hearing, the Government should have filed an expropriation case under Rule 67
of the Revised Rules of Court but it did not do so. Obviously, it did not deem it necessary because the
enactment of the questioned decrees which rendered, by their very passage, any questions with regard to the
expropriation of the properties, moot and academic. In effect, the properties under the decrees were
"automatically expropriated." This becomes more evident when the NHA wrote the Register of Deeds and
requested her to cancel the certificate of titles of the petitioners, furnishing said Register of Deeds only with
copies of the decrees to support its request.
This is hardly the due process of law which the state is expected to observe when it exercises the power of
eminent domain.
xxx
xxx
xxx
This Court further observed that contrary to Rule 67 and established precedents, the decrees provided for the
determination of just compensation at a time earlier than that "of the actual taking of the government or at the
time of the judgment by the court, whichever came first." Apart from this, the fixing of the value of the property
was left by the decrees to the City Assessor.
In P.D. No. 76, P.D. No. 464, P.D. No. 794, and P.D. No. 1533, the basis for determining just compensation was
fixed at the market value declared by the owner or the market value determined by the assessor, whichever is
lower.
P.D.s 1669 and 1670 go further. There is no mention of any market value declared by the owner. Sections 6 of
the two decrees peg just compensation at the market value determined by the City Assessor. The City
Assessor is warned by the decrees to "consider existing conditions in the area notably that no improvement
has been undertaken on the land and that the land is squatted upon by resident families which should
considerably depress the expropriation costs."
In other cases involving expropriation under P.D. Nos. 76, 464, 794, and 1533, this Court has decided to
invalidate the mode of fixing just compensation under said decrees. (See Export Processing Zone Authority vs.
Hon. Ceferino E. Dulay, et al., G.R. No. 59603) 9 With more reason should the method in P.D.s 1669 and 1670
be declared infirm.
PD 1670 being void ab initio, all acts done in reliance thereon and in accordance therewith must also be
deemed void ab initio, including particularly the taking of possession of the property by the National Housing
Authority and its attempts to convert the same into a housing project and the selection of the beneficiaries
thereof.
It appears that the National Housing Authority has since instituted an expropriation suit involving the "SunogApog" property in question, now pending in Branch XL of the Regional Trial Court of Manila, presided over by
Honorable Felicidad Villalon; 10 and that petitioner Pedro Belen continues to be recognized by the owner of
the land, Manotok Services, Inc. as a lessee of a part thereof, identified as Lot 10, Block 18. 11
The invalidation of P.D. 1670 removes the basis for the decisions of the Regional Trial Court and the Court of
Appeals, which are both contrary to the verdict of the Metropolitan Trial Court. On the other hand, there is
nothing in the record to demonstrate any error in the factual and legal dispositions in the latter judgment,
recognizing and vindicating the petitioner's superior right of possession over the Lot 10, block 18 of the
"Sunog-Apog Estate" of the Manotok Services, Inc.
WHEREFORE, the decision of the Court of Appeals of October 2, 1986 and that of the Regional Trial Court
thereby affirmed, are REVERSED AND SET ASIDE, and the decision of the Metropolitan Trial Court (Branch
VII), Manila, rendered on September 5, 1984 in Civil Case No. 078756-CV is REINSTATED AND AFFIRMED,
with costs against the private respondents.
SO ORDERED.
Cruz, Gancayco, Grio-Aquino and Medialdea, JJ., concur.
Republic of the Philippines
SUPREME COURT

Manila
FIRST DIVISION
G.R. No. 87335
February 12, 1990
REPUBLIC OF THE PHILIPPINES, petitioner,
vs.
CRISTINA DE KNECHT AND THE COURT OF APPEALS, respondents.
Villanueva, Talamayan, Nieva, Elegado, and Ante Law Offices for respondent Cristina de Knecht.
GANCAYCO, J.:
The issue posed in this case is whether an expropriation proceeding that was determined by a final judgment
of this Court may be the subject of a subsequent legislation for expropriation.
On February 20, 1979 the Republic of the Philippines filed in the Court of First Instance (CFI) of Rizal in Pasay
City an expropriation proceedings against the owners of the houses standing along Fernando Rein-Del Pan
streets among them Cristina De Knecht (de Knecht for short) together with Concepcion Cabarrus, and some
fifteen other defendants, docketed as Civil Case No. 7001-P.
On March 19, 1979 de Knecht filed a motion to dismiss alleging lack of jurisdiction, pendency of appeal with
the President of the Philippines, prematureness of complaint and arbitrary and erroneous valuation of the
properties. On March 29, 1979 de Knecht filed an ex parte urgent motion for the issuance by the trial court of a
restraining order to restrain the Republic from proceeding with the taking of immediate possession and control
of the property sought to be condemned. In June, 1979 the Republic filed a motion for the issuance of a writ of
possession of the property to be expropriated on the ground that it had made the required deposit with the
Philippine National Bank (PNB) of 10% of the amount of compensation stated in the complaint. In an order
dated June 14, 1979 the lower court issued a writ of possession authorizing the Republic to enter into and take
possession of the properties sought to be condemned, and created a Committee of three to determine the just
compensation for the lands involved in the proceedings.
On July 16, 1979 de Knecht filed with this Court a petition for certiorari and prohibition docketed as G.R. No. L51078 and directed against the order of the lower court dated June 14, 1979 praying that the respondent be
commanded to desist from further proceeding in the expropriation action and from implementing said order. On
October 30, 1980 this Court rendered a decision, the dispositive part of which reads as follows:
WHEREFORE, the petition for certiorari and prohibition is hereby granted. The order of June 14, 1979
authorizing the Republic of the Philippines to take c enter upon the possession of the properties sought to be
condemned is set aside and the respondent Judge is permanently enjoined from taking any further action on
Civil Case No. 7001-P, entitled 'Republic of the Philippines vs. Concepcion Cabarrus Vda. de Santos, et al.'
except to dismiss said case. 1
On August 8, 1981 defendants Maria Del Carmen Roxas Vda. de Elizalde, Francisco Elizalde and Antonio
Roxas moved to dismiss the expropriation action in compliance with the dispositive portion of the aforesaid
decision of this Court which had become final and in order to avoid further damage to same defendants who
were denied possession of their properties. The Republic filed a manifestation on September 7, 1981 stating,
among others, that it had no objection to the said motion to dismiss as it was in accordance with the
aforestated decision.
On September 2, 1983, the Republic filed a motion to dismiss said case due to the enactment of the Batas
Pambansa Blg. 340 expropriating the same properties and for the same purpose. The lower court in an order
of September 2, 1983 dismissed the case by reason of the enactment of the said law. The motion for
reconsideration thereof was denied in the order of the lower court dated December 18, 1986.
De Knecht appealed from said order to the Court of Appeals wherein in due course a decision was rendered on
December 28, 1988, 2 the dispositive part of which reads as follows:
PREMISES CONSIDERED, the order appealed from is hereby SET ASIDE. As prayed for in the appellant's
brief another Order is hereby issued dismissing the expropriation proceedings (Civil Case No. 51078) before
the lower court on the ground that the choice of Fernando Rein-Del Pan Streets as the line through which the
Epifanio de los Santos Avenue should be extended is arbitrary and should not receive judicial approval.
No pronouncement as to Costs. 3
Hence the Republic filed that herein petition for review of the A aforestated decision whereby the following
issues were raised:
I
WHETHER OR NOT THE ENACTMENT OF BATAS PAMBANSA BLG. 340 IS THE PROPER GROUND FOR
THE DISMISSAL OF THE EXPROPRIATION CASE. (PROPERLY PUT, WHETHER OR NOT THE LOWER

COURT COMMITTED GRAVE ABUSE OF DIS CRETION IN DISMISSING CIVIL CASE NO. 7001-P UPON
JUDICIAL NOTICE OF B.P. BLG. 340).
II
WHETHER OR NOT THE DPWH'S "CHOICE" OF LAND TO BE EXPROPRIATED IS STILL AN ISSUE
UNDER THE CIRCUMSTANCES, SAID "CHOICE" HAVING BEEN SUPPLANTED BY THE LEGISLATURE'S
CHOICE.
III
WHETHER OR NOT THE LAW OF THE CASE THEORY SHOULD BE APPLIED TO THE CASE AT BAR. 4
The petition is impressed with merit. There is no question that as early as 1977, pursuant to the Revised
Administrative Code, the national government, through the Department of Public Works and Highways began
work on what was to be the westward extension of Epifanio de los Santos Avenue (EDSA) outfall (or outlet) of
the Manila and suburbs flood control and drainage project and the Estero Tripa de Gallina. These projects
were aimed at: (1) easing traffic congestion in the Baclaran and outlying areas; (2) controlling flood by the
construction of the outlet for the Estero Tripa de Gallina (which drains the area of Marikina, Pasay, Manila and
Paranaque); and (3) thus completing the Manila Flood and Control and Drainage Project.
So the petitioner acquired the needed properties through negotiated purchase starting with the lands from Taft
Avenue up to Roxas Boulevard including the lands in Fernando Rein-Del Pan streets. It acquired through
negotiated purchases about 80 to 85 percent of the lands involved in the project whose owners did not raise
any objection as to arbitrariness on the choice of the project and of the route. It is only with respect to the
remaining 10 to 15 percent along the route that the petitioner cannot negotiate through a sales agreement with
a few land owners, including de Knecht whose holding is hardly 5% of the whole route area. Thus, as above
related on February 20, 1979 the petitioner filed the expropriation proceedings in the Court of First Instance.
There is no question that in the decision of this Court dated October 30, 1980 in De Knecht vs. Bautista, G.R.
No. L-51078, this Court held that the "choice of the Fernando Rein-Del Pan streets as the line through which
the EDSA should be extended to Roxas Boulevard is arbitrary and should not receive judicial approval." 5 It is
based on the recommendation of the Human Settlements Commission that the choice of Cuneta street as the
line of the extension will minimize the social impact factor as the buildings and improvement therein are mostly
motels. 6
In view of the said finding, this Court set aside the order of the trial court dated June 14, 1979 authorizing the
Republic of the Philippines to take possession of the properties sought to be condemned and enjoined the
respondent judge from taking any further action in the case except to dismiss the same.
Said decision having become final no action was taken by the lower court on the said directive of this Court to
dismiss the case. Subsequently B.P. Blg. 340 was enacted by the Batasang Pambansa on February 17, 1983.
On the basis of said law petitioner filed a motion to dismiss the case before the trial court and this was granted.
On appeal by de Knecht to the Court of Appeals the appellate court held that the decision of the Supreme
Court having become final, the petitioner's right as determined therein should no longer be disturbed and that
the same has become the law of the case between the parties involved. Thus, the appellate court set aside the
questioned order of the trial court and issued another order dismissing the expropriation proceedings before
the lower court pursuant to the ruling in De Knecht case.
While it is true that said final judgment of this Court on the subject becomes the law of the case between the
parties, it is equally true that the right of the petitioner to take private properties for public use upon the
payment of the just compensation is so provided in the Constitution and our laws. 7 Such expropriation
proceedings may be undertaken by the petitioner not only by voluntary negotiation with the land owners but
also by taking appropriate court action or by legislation. 8
When on February 17, 1983 the Batasang Pambansa passed B.P. Blg. 340 expropriating the very properties
subject of the present proceedings, and for the same purpose, it appears that it was based on supervening
events that occurred after the decision of this Court was rendered in De Knecht in 1980 justifying the
expropriation through the Fernando Rein-Del Pan Streets.
The social impact factor which persuaded the Court to consider this extension to be arbitrary had disappeared.
All residents in the area have been relocated and duly compensated. Eighty percent of the EDSA outfall and
30% of the EDSA extension had been completed. Only private respondent remains as the solitary obstacle to
this project that will solve not only the drainage and flood control problem but also minimize the traffic
bottleneck in the area.
The Solicitor General summarizing the situation said
The construction and completion of the Metro Manila Flood Control and Drainage Project and the EDSA
extension are essential to alleviate the worsening traffic problem in the Baclaran and Pasay City areas and the

perennial flood problems. Judicial notice may be taken that these problems bedevil life and property not only in
the areas directly affected but also in areas much beyond. Batas Pambansa Blg. 340 was enacted to hasten
'The Project' and thus solve these problems, and its implementation has resulted so far in an 80% completion
of the EDSA outfall and a 30% completion of the EDSA extension, all part of 'The Project'.
This instant case stands in the way of the final solution of the above-mentioned problems, solely because the
single piece of property I occupied' by De Knecht, although already expropriated under B.P. Blg. 340, is the
only parcel of land where Government engineers could not enter due to the 'armed' resistance offered by De
Knecht, guarded and surrounded as the lot is perennially by De Knecht's fierce private security guards. It may
thus be said that De Knecht, without any more legal interest in the land, single-handedly stands in the way of
the completion of 'The Project' essential to the progress of Metro Manila and surrounding areas. Without the
property she persists in occupying and without any bloodletting, the EDSA outfall construction on both sides of
the said property cannot be joined together, and the flood waters of Pasay, Paraaque and Marikina which
flow through the Estero Tripa de Gallina will continue to have no way or outlet that could drain into Manila Bay.
Without said property, the EDSA extension, already 30% completed, can in no way be finished, and traffic will
continue to clog and jam the intersections of EDSA and Taft Avenue in Baclaran and pile up along the airport
roads.
In sum, even in the face of BP340, De Knecht holds the Legislative sovereign will and choice inutile. 9
The Court finds justification in proceeding with the said expropriation proceedings through the Fernando ReinDel Pan streets from ESDA to Roxas Boulevard due to the aforestated supervening events after the rendition
of the decision of this Court in De Knecht.
B.P. Blg. 340 therefore effectively superseded the aforesaid final and executory decision of this Court. And the
trial court committed no grave abuse of discretion in dismissing the case pending before it on the ground of the
enactment of B.P. Blg. 340.
Moreover, the said decision, is no obstacle to the legislative arm of the Government in thereafter (over two
years later in this case) making its own independent assessment of the circumstances then prevailing as to the
propriety of undertaking the expropriation of the properties in question and thereafter by enacting the
corresponding legislation as it did in this case. The Court agrees in the wisdom and necessity of enacting B.P.
Blg. 340. Thus the anterior decision of this Court must yield to this subsequent legislative flat.
WHEREFORE, the petition is hereby GRANTED and the questioned decision of the Court of Appeals dated
December 28, 1988 and its resolution dated March 9, 1989 are hereby REVERSED and SET ASIDE and the
order of Branch III of the then Court of First Instance of Rizal in Pasay City in Civil Case No. 7001-P dated
September 2, 1983 is hereby reinstated without pronouncement as to costs.
SO ORDERED.
Narvasa, Grio-Aquino and Medialdea, JJ., concur.

Separate Opinions
CRUZ, J., concurring:
While the ponencia is plain enough, I wish to make it even plainer that B.P. Blg. 340 is not a legislative reversal
of our finding in De Knecht v. Bautista, 100 SCRA 660, that the expropriation of the petitioner's property was
arbitrary. As Justice Gancayco clearly points out, supervening events have changed the factual basis of that
decision to justify the subsequent enactment of the statute. If we are sustaining that legislation, it is not
because we concede that the lawmakers can nullify the findings of the Court in the exercise of its discretion. It
is simply because we ourselves have found that under the changed situation, the present expropriation is no
longer arbitrary.
I must add that this decision is not a reversal either of the original De Knecht case, which was decided under a
different set of facts.
Separate Opinions
CRUZ, J., concurring:
While the ponencia is plain enough, I wish to make it even plainer that B.P. Blg. 340 is not a legislative reversal
of our finding in De Knecht v. Bautista, 100 SCRA 660, that the expropriation of the petitioner's property was
arbitrary. As Justice Gancayco clearly points out, supervening events have changed the factual basis of that

decision to justify the subsequent enactment of the statute. If we are sustaining that legislation, it is not
because we concede that the lawmakers can nullify the findings of the Court in the exercise of its discretion. It
is simply because we ourselves have found that under the changed situation, the present expropriation is no
longer arbitrary.
I must add that this decision is not a reversal either of the original De Knecht case, which was decided under a
different set of facts.
Footnotes