Topics: Transfer of private and public lands to farmer beneficiaries, lands not
covered by land acquisition, retention rights, exemption, exclusions
Cases:
Roxas vs. Daez, GR 127876, Dec. 17, 1999 321 SCRA 106
Daez vs. CA, GR 133507, Feb. 17. 2000, 325 SCRA 856
Facts:
 Eudosia Daez applied for exemption of her 4.1685 hectare riceland in
Brgy. Lawa, Meycauayan, Bulacan being cultivated by the herein
respondents. DAR Undersecretary Jose C. Medina denied the application
for exemption upon finding that the subject land is covered under LOI 474,
the petitioner's total properties having exceeded the 7-hectare limit
provided by law.
 The Secretary of DAR, Benjamin T. Leong, the Court of Appeals and the
Supreme Court all affirmed the said Order and disregarded an Affidavit
executed by the respondents stating that they are not the tenants of the
land. Their findings was that the Affidavit was merely issued under duress.
In the meantime, Emancipation Patents (EPs) were issued to the
respondents.
 Undaunted, Daez next filed an application for retention of the same
riceland under R.A. No. 6657. DAR Region III OIC-Director Eugenio B.
Bernardo allowed her to retain the subject riceland but denied the
application of her children to retain three (3) hectares each for failure to
prove actual tillage or direct management thereof. This order was set
aside by the DAR Secretary Ernesto Garilao but reinstated on appeal by
the Office of the President. The Court of Appeals again reversed this
Decision and ordered the reinstatement of the previous Decision of DAR
Secretary Ernesto D. Garilao. Hence, this Appeal.
Issue:
Whether or not petitioner can still file a petition for retention of the
subject landholdings, despite the fact that a previous decision denying
the petition for exemption had long become final and executory\
Held:
 It is incorrect to posit that an application for exemption and an application
for retention are one and the same thing. Being distinct remedies, finality
of judgment in one does not preclude the subsequent institution of the
other. There was, thus, no procedural impediment to the application filed
by Eudosia Daez for the retention of the subject 4.1865 hectare riceland,
even after her appeal for exemption of the same land was denied in a
decision that became final and executory.
 The right of retention is a constitutionally guaranteed right, which is
subject to qualification by the legislature. It serves to mitigate the effects
of compulsory land acquisition by balancing the rights of the landowner
and the tenant by implementing the doctrine that social justice was not
meant to perpetrate an injustice against the landowner. A retained area
as its name denotes, is land which is not supposed to anymore leave the
landowner's dominion, thus, sparing the government from the
inconvenience of taking land only to return it to the landowner afterwards,
which would be a pointless process.
 The issuance of EPs and CLOAs to beneficiaries does not absolutely bar
the landowner from retaining the area covered thereby. Under
Administrative Order No. 2, Series of 1994, an EP or CLOA may be
cancelled if the land covered is later found to be part of the landowner's
retained area.
Rodriguez vs. Salvador, GR 171972, June 8, 2011, 651 SCRA 429
DOCTRINE: Agricultural tenancy is not presumed but must be proven by the
person alleging it.
FACTS:
 Respondent Teresita V. Salvador filed a Complaint for Unlawful
Detainer, against petitioners Lucia and Prudencia Rodriguez, mother
and daughter, respectively. Respondent alleged that she is the
absolute owner of a parcel of land in the name of the Heirs of Cristino
Salvador represented by her and that petitioners acquired
possession of the subject land by mere tolerance of her
predecessors-in-interest; and that despite several verbal and written
demands made by her, petitioners refused to vacate the subject land.
 In their Answer, petitioners interposed the defense of agricultural
tenancy. Lucia claimed that she and her deceased husband,
Serapio, entered the subject land with the consent and permission of
respondent's predecessors-in-interest, siblings Cristino and Sana
Salvador, under the agreement that Lucia and Serapio would devote
the property to agricultural production and share the produce with the
Salvador siblings. Since there is a tenancy relationship between the
parties, petitioners argued that it is the Department of Agrarian
Reform Adjudication Board (DARAB) which has jurisdiction over the
case and not the MTC.
 MTC: there exists an agricultural tenancy relationship between the
parties.
 Aggrieved, respondent filed an appeal. RTC initially remanded the
case to the MTC for preliminary hearing but upon motion for
reconsideration, RTC affirmed the MTC Decision.
 Respondent sought reconsideration but it was denied by the RTC
thus elevating the case to the CA.
 CA rendered judgment in favor of respondent. It ruled that no
tenancy relationship exists between the parties because petitioners
failed to prove that respondent or her predecessors-in-interest
consented to the tenancy relationship. The CA likewise gave no
probative value to the affidavits of petitioners' witnesses as it found
their statements insufficient to establish petitioners' status as
agricultural tenants. If at all, the affidavits merely showed that
petitioners occupied the subject land with the consent of the original
owners. And since petitioners are occupying the subject land by
mere tolerance, they are bound by an implied promise to vacate the
same upon demand by the respondent. Failing to do so, petitioners
are liable to pay damages.
 In this case, to prove that an agricultural tenancy relationship exists
between the parties, petitioners submitted as evidence the affidavits
of petitioner Lucia and their neighbors. In her affidavit, petitioner
Lucia declared that she and her late husband occupied the subject
land with the consent and permission of the original owners and that
their agreement was that she and her late husband would cultivate
the subject land, devote it to agricultural production, share the
harvest with the landowners on a 50-50 basis, and at the same time
watch over the land. Witness Alejandro Arias attested in his affidavit
that petitioner Lucia and her husband, Serapio, have been cultivating
the subject land since 1960; that after the demise of Serapio,
petitioner Lucia and her children continued to cultivate the subject
land; and that when respondent's predecessors-in-interest were still
alive, he would often see them and respondent get some of the
harvest. The affidavit of witness Conseso stated, in essence, that
petitioner Lucia has been in peaceful possession and cultivation of
the subject property since 1960 and that the harvest was divided into
two parts, ½ for the landowner and ½ for petitioner Lucia.
ISSUE:
Whether or not there is agricultural tenancy in this case
RULING:
 Agricultural tenancy relationship does not exist in the instant case.
Agricultural tenancy exists when all the following requisites are
present: 1) the parties are the landowner and the tenant or
agricultural lessee; 2) the subject matter of the relationship is an
agricultural land; 3) there is consent between the parties to the
relationship; 4) the purpose of the relationship is to bring about
agricultural production; 5) there is personal cultivation on the part of
the tenant or agricultural lessee; and 6) the harvest is shared
between landowner and tenant or agricultural lessee.
 The element of consent is lacking. Except for the self-serving affidavit
of Lucia, no other evidence was submitted to show that respondent's
predecessors-in-interest consented to a tenancy relationship with
petitioners. Self-serving statements, however, will not suffice to
prove consent of the landowner; independent evidence is necessary.
 Petitioners also failed to prove sharing of harvest. Petitioners should
have presented receipts or any other evidence to show that there
was sharing of harvest and that there was an agreed system of
sharing between them and the landowners.
Mere occupation or cultivation of an agricultural land will not ipso facto make
the tiller an agricultural tenant. It is incumbent upon a person who claims to
be an agricultural tenant to prove by substantial evidence all the requisites
of agricultural tenancy.
Alita vs. CA, GR 78517, Feb. 27, 1989, 170 SCRA 706
FACTS:
-petition seeking the reversal Court of Appeals decision: 1)Declaring
Presidential Decree No. 27 inapplicable to lands obtained thru the
homestead law; 2) Declaring that the 4 registered co-owners will cultivate
and operate the farmholding themselves as owners; & 3) Ejecting tenants,
namely; Gabino Alita, Jesus Julian, Sr., Jesus Julian, Jr., Pedro Ricalde,
Vicente Ricalde and Rolando Salamar, as the owners would want to cultivate
the farmholding themselves.
-2 parcels of land at Guilinan, Tungawan, Zamboanga del Sur acquired by
respondents Reyes through homestead patent under Commonwealth Act
No. 141
- Reyes wants to personally cultivate these lands, but Alita refuse to vacate,
relying on the provisions of P.D. 27 and P.D. 316 and regulations of
MAR/DAR
-June 18, 1981: Respondents Reyes (Plaintiff) instituted a complaint against
Minister of Agrarian Reform Estrella, Regional Director of MAR Region IX
P.D. Macarambon, and Alita et.al for the declaration of P.D. 27 and all other
Decrees, Letters of Instructions and General Orders inapplicable to
homestead lands. Defendants Alita filed their answer with special and
affirmative defenses.
-July 19, 1982: Reyes filed urgent motion to enjoin the defendants from
declaring the lands in litigation under Operation Land Transfer and from
being issued land transfer certificates
-November 5, 1982: Court of Agrarian Relations 16th Regional District,
Branch IV, Pagadian City (Regional Trial Court, 9th Judicial Region, Branch
XVIII) rendered its decision dismissing complaint and the motion to enjoin
On January 4, 1983, plaintiffs moved to reconsider the Order of dismissal, to
which defendants filed their opposition on January 10, 1983.
RTC: issued decision prompting defendants Alita et al to move for
reconsideration but was denied
CA: the same was sustained
ISSUE: whether or not lands obtained through homestead patent are
covered by the Agrarian Reform under P.D. 27.--NO
We agree with the petitioners Alita et.al in saying that P.D. 27 decreeing the
emancipation of tenants from the bondage of the soil and transferring to them
ownership of the land they till is a sweeping social legislation, a remedial
measure promulgated pursuant to the social justice precepts of the
Constitution. However, such contention cannot be invoked to defeat the
purpose of the enactment of the Public Land Act or Commonwealth Act No.
141 to protect one’s right to life itself by give a needy citizen a land wherein
they could build a house and plant for necessary subsistence.
Art XIII, Sec 6 of the Constitution likewise respects the superiority of the
homesteaders' rights over the rights of the tenants guaranteed by the
Agrarian Reform statute.
Section 6. The State shall apply the principles of agrarian reform or
stewardship…in the disposition or utilization of other natural
resources, including lands of public domain under lease or
concession suitable to agriculture, subject to prior rights, homestead
rights of small settlers, and the rights of indigenous communities to
their ancestral lands.
Comprehensive Agrarian Reform Law of 1988 or Republic Act No. 6657
likewise supports the inapplicability of P.D. 27 to lands covered by
homestead patents like those of the property in question,
Section 6. Retention Limits. ...
... Provided further, That original homestead grantees or their direct
compulsory heirs who still own the original homestead at the time of
the approval of this Act shall retain the same areas as long as they
continue to cultivate said homestead.'
WHEREFORE, premises considered, the decision of the respondent Court
of Appeals sustaining the decision of the Regional Trial Court is hereby
AFFIRMED.
DAR vs. Sutton, GR 162070, Oct. 19, 2005, 473 SCRA 392
FACTS:
Respondents herein inherited a land which has been devoted
exclusively to cow and calf breeding. Pursuant to the then existing agrarian
reform program of the government, respondents made a voluntary offer to
sell (VOS) their landholdings to petitioner DAR to avail of certain incentives
under the law. a new agrarian law, Republic Act (R.A.) No. 6657, also
known as the Comprehensive Agrarian Reform Law (CARL) of 1988, took
effect. It included in its coverage farms used for raising livestock, poultry and
swine. Thereafter, in an en banc decision in the case of Luz Farms v.
Secretary of DAR this Court ruled that lands devoted to livestock and poultry-
raising are not included in the definition of agricultural land. Hence, we
declared as unconstitutional certain provisions of the CARL insofar as they
included livestock farms in the coverage of agrarian reform. Thus,
respondents filed with petitioner DAR a formal request to withdraw their VOS
as their landholding was devoted exclusively to cattle-raising and thus
exempted from the coverage of the CARL. However, DAR issued A.O. No.
9, series of 1993 which provided that only portions of private agricultural
lands used for the raising of livestock, poultry and swine as of June 15, 1988
shall be excluded from the coverage of the CARL. The DAR Secretary
issued an Order partially granting the application of respondents for
exemption from the coverage of CARL but applying the retention limits
outlined in the DAR A.O. No. 9. Respondents moved for
reconsideration. They contend that their entire landholding should be
exempted as it is devoted exclusively to cattle-raising and appealing that the
DAR A.O. No. 9 be declared unconstitutional.
ISSUE:
Whether or not DAR Administrative Order No. 09, Series of 1993
which prescribes a maximum retention for owners of lands devoted to
livestock raising is constitutional?
HELD:
The A.O. sought to regulate livestock farms by including them in the
coverage of agrarian reform and prescribing a maximum retention limit for
their ownership is invalid as it contravenes the Constitution. . The Court
clarified in the Luz Farms case that livestock, swine and poultry-raising are
industrial activities and do not fall within the definition of “agriculture” or
“agricultural activity.” The raising of livestock, swine and poultry is different
from crop or tree farming. It is an industrial, not an agricultural activity. DAR
has no power to regulate livestock farms which have been exempted by the
Constitution from the coverage of agrarian reform. It has exceeded its
power in issuing the assailed A.O. The assailed A.O. of petitioner DAR was
properly stricken down as unconstitutional as it enlarges the coverage of
agrarian reform beyond the scope intended by the 1987 Constitution
Milestone Farms vs. Office of the President, GR 182332, Feb. 23, 2011, 644
SCRA 217
G.R. No. 182332 : February 23, 2011
MILESTONE FARMS, INC.,Petitioner,v. OFFICE OF THE
PRESIDENT,Respondent.
NACHURA,J.:
FACTS:
Petitioner Milestone Farms, Inc. was incorporated with the SEC. On June
10, 1988, a new agrarian reform law, Republic Act (R.A.) No. 6657,
otherwise known as the Comprehensive Agrarian Reform Law (CARL), took
effect, which included the raising of livestock, poultry, and swine in its
coverage. However, on December 4, 1990, this Court, sitting en banc, ruled
in Luz Farms v. Secretary of the Department of Agrarian Reform that
agricultural lands devoted to livestock, poultry, and/or swine raising are
excluded from the Comprehensive Agrarian Reform Program (CARP).
Thus, in May 1993, petitioner applied for the exemption/exclusion of its
316.0422-hectare property. Meanwhile, on December 27, 1993, the
Department of Agrarian Reform (DAR) issued Administrative Order No. 9,
Series of 1993 (DAR A.O. No. 9), setting forth rules and regulations to govern
the exclusion of agricultural lands used for livestock, poultry, and swine
raising from CARP coverage. Thus, on January 10, 1994, petitioner re-
documented its application pursuant to DAR A.O. No. 9.
Acting on the said application, the DARs Land Use Conversion and
Exemption Committee (LUCEC) of Region IV conducted an ocular
inspection on petitioners property and arrived at the following findings:
The LUCEC, thus, recommended the exemption of petitioners 316.0422-
hectare property from the coverage of CARP. Adopting the LUCEC's findings
and recommendation, DAR Regional Director Percival Dalugdug (Director
Dalugdug) issued an Order dated June 27, 1994, exempting petitioners
316.0422-hectare property from CARP.
The Southern Pinugay Farmers Multi-Purpose Cooperative, Inc. (Pinugay
Farmers), represented by Timiano Balajadia, Sr. (Balajadia), moved for the
reconsideration of the said Order, but the same was denied by Director
Dalugdug in his Order dated November 24, 1994.Subsequently, the Pinugay
Farmers filed a letter-appeal with the DAR Secretary.
Correlatively, on June 4, 1994, petitioner filed a complaint for Forcible Entry
against Balajadia and company before the Municipal Circuit Trial Court
(MCTC) of Teresa-Baras, Rizal, docketed as Civil Case No. 781-T.The
MCTC ruled in favor of petitioner, but the decision was later reversed by the
Regional Trial Court, Branch 80, of Tanay, Rizal. Ultimately, the case
reached the CA, which, in its Decision dated October 8, 1999, reinstated the
MCTCs ruling, ordering Balajadia and all defendants therein to vacate
portions of the property covered by TCT Nos. M-6013, M-8796, and M-8791.
In its Resolution dated July 31, 2000, the CA held that the defendants therein
failed to timely file a motion for reconsideration, given the fact that their
counsel of record received its October 8, 1999 Decision; hence, the same
became final and executory.
In the meantime, R.A. No. 6657 was amended by R.A. No. 7881,which was
approved on February 20, 1995. Private agricultural lands devoted to
livestock, poultry, and swine raising were excluded from the coverage of the
CARL.
On January 21, 1997, then DAR Secretary Ernesto D. Garilao issued an
Order exempting from CARP only 240.9776 hectares of the 316.0422
hectares previously exempted by Director Dalugdug, and declaring 75.0646
hectares of the property to be covered by CARP.
On February 4, 2000, the Office of the President rendered a decision
reinstating Order declared the entire 316.0422-hectare property exempt from
the coverage of CARP.
Consequently, petitioner sought recourse from the CA. the CA found that,
based on the documentary evidence presented, the property subject of the
application for exclusion had more than satisfied the animal-land and
infrastructure-animal ratios under DAR A.O. No. 9. The CA also found that
petitioner applied for exclusion long before the effectivity of DAR A.O. No. 9,
thus, negating the claim that petitioner merely converted the property for
livestock, poultry, and swine raising in order to exclude it from CARP
coverage. Hence, the instant petition is hereby granted.
Finally, petitioners motion for reconsideration was denied by the CA.
ISSUE: Whether the land is exempted from CARL coverage?
HELD: The decision of the Court of Appeals is sustained.
POLITICAL LAW validity of the administrative order
In the case at bar, we find that the impugned A.O. is invalid as it contravenes
the Constitution. The A.O. sought to regulate livestock farms by including
them in the coverage of agrarian reform and prescribing a maximum
retention limit for their ownership. However, the deliberations of the 1987
Constitutional Commission show a clear intent to exclude, inter alia,all lands
exclusively devoted to livestock, swine and poultry-raising. The Court
clarified in the Luz Farms case that livestock, swine and poultry-raising are
industrial activities and do not fall within the definition of "agriculture" or
"agricultural activity." The raising of livestock, swine and poultry is different
from crop or tree farming. It is an industrial, not an agricultural, activity. A
great portion of the investment in this enterprise is in the form of industrial
fixed assets, such as: animal housing structures and facilities, drainage,
waterers and blowers, feedmill with grinders, mixers, conveyors, exhausts
and generators, extensive warehousing facilities for feeds and other
supplies, anti-pollution equipment like bio-gas and digester plants
augmented by lagoons and concrete ponds, deepwells, elevated water
tanks, pump houses, sprayers, and other technological appurtenances.
Clearly, petitioner DAR has no power to regulate livestock farms which have
been exempted by the Constitution from the coverage of agrarian reform. It
has exceeded its power in issuing the assailed A.O
Topics: Land redistribution, Land Tenure Improvement, alternative business
arrangements.
Statutory reference: Secs.12, 16-20, 22-27, 32 of RA 6657
Hacienda Luisita vs. PARC, GR 171101, May 17, 1993, Apr. 24, 2012, 670
SCRA 392
I. THE FACTS
On July 5, 2011, the Supreme Court en banc voted unanimously (11-0)
to DISMISS/DENY the petition filed by HLI and AFFIRM with
MODIFICATIONS the resolutions of the PARC revoking HLI’s Stock
Distribution Plan (SDP) and placing the subject lands in Hacienda Luisita
under compulsory coverage of the Comprehensive Agrarian Reform
Program (CARP) of the government.
The Court however did not order outright land distribution. Voting 6-5,
the Court noted that there are operative facts that occurred in the interim
and which the Court cannot validly ignore. Thus, the Court declared that
the revocation of the SDP must, by application of the operative fact
principle, give way to the right of the original 6,296 qualified farmworkers-
beneficiaries (FWBs) to choose whether they want to remain as HLI
stockholders or [choose actual land distribution]. It thus ordered the
Department of Agrarian Reform (DAR) to “immediately schedule
meetings with the said 6,296 FWBs and explain to them the effects,
consequences and legal or practical implications of their choice, after
which the FWBs will be asked to manifest, in secret voting, their choices
in the ballot, signing their signatures or placing their thumbmarks, as the
case may be, over their printed names.”
The parties thereafter filed their respective motions for reconsideration
of the Court decision.
II. THE ISSUES
(1) Is the operative fact doctrine available in this case?
(2) Is Sec. 31 of RA 6657 unconstitutional?
(3) Can’t the Court order that DAR’s compulsory acquisition of Hacienda
Lusita cover the full 6,443 hectares allegedly covered by RA 6657 and
previously held by Tarlac Development Corporation (Tadeco), and not
just the 4,915.75 hectares covered by HLI’s SDP?
(4) Is the date of the “taking” (for purposes of determining the just
compensation payable to HLI) November 21, 1989, when PARC
approved HLI’s SDP?
(5) Has the 10-year period prohibition on the transfer of awarded lands
under RA 6657 lapsed on May 10, 1999 (since Hacienda Luisita were
placed under CARP coverage through the SDOA scheme on May 11,
1989), and thus the qualified FWBs should now be allowed to sell their
land interests in Hacienda Luisita to third parties, whether they have fully
paid for the lands or not?
(6) THE CRUCIAL ISSUE: Should the ruling in the July 5, 2011 Decision
that the qualified FWBs be given an option to remain as stockholders of
HLI be reconsidered?
III. THE RULING
[The Court PARTIALLY GRANTED the motions for reconsideration of
respondents PARC, et al. with respect to the option granted to the
original farmworkers-beneficiaries (FWBs) of Hacienda Luisita to remain
with petitioner HLI, which option the Court thereby RECALLED and SET
ASIDE. It reconsidered its earlier decision that the qualified FWBs should
be given an option to remain as stockholders of HLI, and
UNANIMOUSLY directed immediate land distribution to the qualified
FWBs.]
1. YES, the operative fact doctrine is applicable in this case.
[The Court maintained its stance that the operative fact doctrine is
applicable in this case since, contrary to the suggestion of the minority,
the doctrine is not limited only to invalid or unconstitutional laws but also
applies to decisions made by the President or the administrative
agencies that have the force and effect of laws. Prior to the nullification
or recall of said decisions, they may have produced acts and
consequences that must be respected. It is on this score that the
operative fact doctrine should be applied to acts and consequences that
resulted from the implementation of the PARC Resolution approving the
SDP of HLI. The majority stressed that the application of the operative
fact doctrine by the Court in its July 5, 2011 decision was in fact favorable
to the FWBs because not only were they allowed to retain the benefits
and homelots they received under the stock distribution scheme, they
were also given the option to choose for themselves whether they want
to remain as stockholders of HLI or not.]
2. NO, Sec. 31 of RA 6657 NOT unconstitutional.
[The Court maintained that the Court is NOT compelled to rule on the
constitutionality of Sec. 31 of RA 6657, reiterating that it was not raised
at the earliest opportunity and that the resolution thereof is not the lis
mota of the case. Moreover, the issue has been rendered moot and
academic since SDO is no longer one of the modes of acquisition under
RA 9700. The majority clarified that in its July 5, 2011 decision, it made
no ruling in favor of the constitutionality of Sec. 31 of RA 6657, but found
nonetheless that there was no apparent grave violation of the
Constitution that may justify the resolution of the issue of
constitutionality.]
3. NO, the Court CANNOT order that DAR’s compulsory acquisition of
Hacienda Lusita cover the full 6,443 hectares and not just the 4,915.75
hectares covered by HLI’s SDP.
[Since what is put in issue before the Court is the propriety of the
revocation of the SDP, which only involves 4,915.75 has. of agricultural
land and not 6,443 has., then the Court is constrained to rule only as
regards the 4,915.75 has. of agricultural land. Nonetheless, this should
not prevent the DAR, under its mandate under the agrarian reform law,
from subsequently subjecting to agrarian reform other agricultural lands
originally held by Tadeco that were allegedly not transferred to HLI but
were supposedly covered by RA 6657
However since the area to be awarded to each FWB in the July 5, 2011
Decision appears too restrictive – considering that there are roads,
irrigation canals, and other portions of the land that are considered
commonly-owned by farmworkers, and these may necessarily result in
the decrease of the area size that may be awarded per FWB – the Court
reconsiders its Decision and resolves to give the DAR leeway in
adjusting the area that may be awarded per FWB in case the number of
actual qualified FWBs decreases. In order to ensure the proper
distribution of the agricultural lands of Hacienda Luisita per qualified
FWB, and considering that matters involving strictly the administrative
implementation and enforcement of agrarian reform laws are within the
jurisdiction of the DAR, it is the latter which shall determine the area with
which each qualified FWB will be awarded.
On the other hand, the majority likewise reiterated its holding that the
500-hectare portion of Hacienda Luisita that have been validly converted
to industrial use and have been acquired by intervenors Rizal
Commercial Banking Corporation (RCBC) and Luisita Industrial Park
Corporation (LIPCO), as well as the separate 80.51-hectare SCTEX lot
acquired by the government, should be excluded from the coverage of
the assailed PARC resolution. The Court however ordered that the
unused balance of the proceeds of the sale of the 500-hectare converted
land and of the 80.51-hectare land used for the SCTEX be distributed to
the FWBs.]
4. YES, the date of “taking” is November 21, 1989, when PARC approved
HLI’s SDP.
[For the purpose of determining just compensation, the date of “taking”
is November 21, 1989 (the date when PARC approved HLI’s SDP) since
this is the time that the FWBs were considered to own and possess the
agricultural lands in Hacienda Luisita. To be precise, these lands became
subject of the agrarian reform coverage through the stock distribution
scheme only upon the approval of the SDP, that is, on November 21,
1989. Such approval is akin to a notice of coverage ordinarily issued
under compulsory acquisition. On the contention of the minority (Justice
Sereno) that the date of the notice of coverage [after PARC’s revocation
of the SDP], that is, January 2, 2006, is determinative of the just
compensation that HLI is entitled to receive, the Court majority noted that
none of the cases cited to justify this position involved the stock
distribution scheme. Thus, said cases do not squarely apply to the instant
case. The foregoing notwithstanding, it bears stressing that the DAR's
land valuation is only preliminary and is not, by any means, final and
conclusive upon the landowner. The landowner can file an original action
with the RTC acting as a special agrarian court to determine just
compensation. The court has the right to review with finality the
determination in the exercise of what is admittedly a judicial function.]
5. NO, the 10-year period prohibition on the transfer of awarded lands
under RA 6657 has NOT lapsed on May 10, 1999; thus, the qualified
FWBs should NOT yet be allowed to sell their land interests in Hacienda
Luisita to third parties.
[Under RA 6657 and DAO 1, the awarded lands may only be transferred
or conveyed after 10 years from the issuance and registration of the
emancipation patent (EP) or certificate of land ownership award (CLOA).
Considering that the EPs or CLOAs have not yet been issued to the
qualified FWBs in the instant case, the 10-year prohibitive period has not
even started. Significantly, the reckoning point is the issuance of the EP
 or CLOA, and not the placing of the agricultural lands under CARP
coverage. Moreover, should the FWBs be immediately allowed the
option to sell or convey their interest in the subject lands, then all efforts
at agrarian reform would be rendered nugatory, since, at the end of the
day, these lands will just be transferred to persons not entitled to land
distribution under CARP.]
6. YES, the ruling in the July 5, 2011 Decision that the qualified FWBs
be given an option to remain as stockholders of HLI should be
reconsidered.
[The Court reconsidered its earlier decision that the qualified FWBs
should be given an option to remain as stockholders of HLI, inasmuch as
these qualified FWBs will never gain control [over the subject lands]
given the present proportion of shareholdings in HLI. The Court noted
that the share of the FWBs in the HLI capital stock is [just] 33.296%.
Thus, even if all the holders of this 33.296% unanimously vote to remain
as HLI stockholders, which is unlikely, control will never be in the hands
of the FWBs. Control means the majority of [sic] 50% plus at least one
share of the common shares and other voting shares. Applying the
formula to the HLI stockholdings, the number of shares that will constitute
the majority is 295,112,101 shares (590,554,220 total HLI capital shares
divided by 2 plus one [1] HLI share). The 118,391,976.85 shares subject
to the SDP approved by PARC substantially fall short of the 295,112,101
shares needed by the FWBs to acquire control over HLI.]
Landbank vs. Colarina, Sep. 1, 2010, GR 176410, 629 SCRA 614
FACTS:
Respondent is the registered owner of three (3) parcels of agricultural land
which he acquired from their former owner, Damiana Arcega. The parcels
of land have a total area of 972,047 square meters. Upon acquisition thereof,
respondent manifested his voluntary offer to sell the properties to the DAR
for coverage under
R.A. No. 6657. Respondent‘s assessment value of the properties was
P45,000.00 per hectare.
The DAR, through petitioner LBP assessed the properties and offered to
purchase only 57.2047 hectares out of the 97.2047 hectares voluntarily
offered for sale by respondent. The excluded area (40 hectares) fell under
the exemptions and exclusions provided in Section 10 of the CARL, i.e., all
lands with eighteen percent (18%) slope and over.
As the LBP ‘s assessment and valuation of the properties was unacceptable
to, and rejected by, respondent, he elevated the determination of just
compensation of the properties to the Provincial Agrarian Reform
Adjudicator (PARAD). Unfortunately for respondent, the PARAD affirmed
the valuation set forth by the LBP. Disappointed with the low valuation by
petitioner and the DAR, respondent filed a Complaint
before the RTC, for the judicial determination of just compensation.
During pre-trial, LBP manifested that the subject properties may be
reassessed and revaluated based on the new guidelines set forth in DAR
A.O. No. 11, Series of 1994. Intent on finding a common ground between
petitioner and respondent and to amicably settle the case, the SAC ordered
the revaluation.
However, the valuation was still rejected by respondent. Hence, trial ensued.
ISSUE: How should the value of ―just compensation‖ be computed?
HELD:
Citing Land Bank of the Philippines v. Kelada, the Court declared: While SAC
is Required to consider the acquisition cost of the land, the current value of
like
properties, its nature, actual use and income, the sworn valuation by the
owner, the tax declaration and the assessments made by the
government assessors to determine just compensation, it is equally true
that these factors have been translated into a basic formula by the DAR
pursuant to its rule-making power under Section 49 of RA No. 6657. As the
government agency principally tasked to implement the agrarian reform
program, it is the DAR ‘s duty to issue rules and regulations to carry out the
object of the law. DAR AO No. 5, s. of 1998 precisely ―filled in the details‖
of Section 17, RA No. 6657 by providing a basic formula by which the factors
mentioned therein may be taken into account. The SAC was at no liberty to
disregard the formula
which was devised to implement the said provision. It is elementary that rules
and regulations issued by administrative bodies to interpret the law which
they are entrusted to enforce, have the force of law, and are entitled to great
respect.
Administrative issuances partake of the nature of a statute and have in their
favor a presumption of legality. As such, courts cannot ignore administrative
issuances especially when, as in this case, its validity was not put in issue.
Unless an administrative order is declared invalid, courts have no option but
to apply the same.
While the Court commends respondent in readily participating in the
government ‘s agrarian reform program, our previous rulings preclude us
from validating the valuation of the subject properties proffered to, and
affirmed by, the SAC. The government cannot be forced to purchase land
which it finds no need for, regardless of Oliva ‘s unschooled opinion.
Considering respondent‘s belief that the properties are worth more than the
valuation made by the DAR, he can proceed to develop the land excluded
by the DAR from expropriation into its potential use as assessed by Oliva.

Lubrica vs. Landbank, GR 170220, November 20, 2006, 507 SCRA 415
Landbank vs. CA, GR 128557, Dec. 29, 1999, 321 SCRA 629
Mago vs. Barbin, GR 173923, Oct. 12, 2009, 603 SCRA 232
Padua vs. CA, GR 153456, Mar. 2, 2007, 517 SCRA 232
Estribillo vs. DAR, GR 159674, June 30, 2006, 494 SCRA 218
Gabriel vs.Pangilinan, 58 SCRA 590, 194
II. July 17, 2018 - Midterm Exam