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LUZ FARMS, Petitioner, v.

THE HONORABLE Issue: Whether or not certain provisions of RA 6657 is

SECRETARY OF THE DEPARTMENT OF AGRARIAN unconstitutional for including in its definition of
REFORM, Respondent. “Agriculture” the livestock and poultyr industry?

Facts Ruling:

On 10 June 1988, RA 6657 was approved by the Yes. Looking into the transcript of the Constitutional
President of the Philippines, which includes, among Commission on the meaning of the word “agriculture”, it
others, the raising of livestock, poultry and swine in its showed that the framers never intended to include
coverage. livestock and poultry industry in the coverage of the
constitutionally mandated agrarian reform program of the
Petitioner Luz Farms, a corporation engaged in the government.
livestock and poultry business, avers that it would be
adversely affected by the enforcement of sections 3(b), Further, Commissioner Tadeo pointed out that the reasin
11, 13, 16 (d), 17 and 32 of the said law. Hence, it prayed why they used the term “farmworkers” rather than
that the said law be declared unconstitutional. The “agricultural workers” in the said law is because
mentioned sections of the law provies, among others, the “agricultural workers” includes the livestock and poultry
product-sharing plan, including those engaged in industry, hence, since they do not intend to include the
livestock and poultry business. latter, they used “farmworkers” to have distinction.

Luz Farms further argued that livestock or poultry raising Hence, there is merit on the petitioner’s argument that
is not similar with crop or tree farming. That the land is the product-sharing plan applied to “corporate farms” in
not the primary resource in this undertaking and the contested provisions is unreasonable for being
represents no more than 5% of the total investments of consficatory and violative of the due process of law.
commercial livestock and poultry raisers. That the land is
incidental but not the principal factor or consideration in Insofar as the inclusion of the raising of livestock, poultry
their industry. Hence, it argued that it should not be and swine in its coverage as well as the Implementing
included in the coverage of RA 6657 which covers Rules and Guidelines promulgated in accordance
“agricultural lands”. therewith, are hereby DECLARED null and void for being
segregation of 400 hectares of the land for distribution
under CARP. The land was subjected to coverage on the
CENTRAL MINDANAO UNIVERSITY(CMU) basis of DAR's determination that the lands do not meet
REPRESENTED ITS PRESIDENT DR. LEONARDO A. the condition for exemption, that is, it is not "actually,
CHUA, petitioner, vs. THE DEPARTMENT OF directly, and exclusively used" for educational purposes.
FARMERS AGRICULTURAL LABORERS Is the CMU land covered by CARP? Who determines
ORGANIZATION (BUFFALO), respondents. whether lands reserved for public use by presidential
proclamation is no longer actually, directly and
Facts: exclusively used and necessary for the purpose for which
they are reserved?
On 16 January 1958, President Carlos Garcia issued
Proclamation No. 467 reserving for the Mindanao Held:
Agricultural College, now the CMU, a piece of land to be
used as its future campus. In 1984, CMU embarked on a The land is exempted from CARP. CMU is in the best
project titled "Kilusang Sariling Sikap" wherein parcels of position to resolve and answer the question of when and
land were leased to its faculty members and employees. what lands are found necessary for its use. The Court
Under the terms of the program, CMU will assist faculty also chided the DARAB for resolving this issue of
members and employee groups through the extension of exemption on the basis of "CMU's present needs." The
technical know-how, training and other kinds of Court stated that the DARAB decision stating that for the
assistance. In turn, they paid the CMU a service fee for land to be exempt it must be "presently, actively exploited
use of the land. The agreement explicitly provided that and utilized by the university in carrying out its present
there will be no tenancy relationship between the lessees educational program with its present student population
and the CMU. and academic faculty" overlooked the very significant
factor of growth of the university in the years to come.
When the program was terminated, a case was filed by
the participants of the "Kilusang Sariling Sikap" for In the case at bar, the DARAB found that the
declaration of status as tenants under the CARP. In its complainants are not share tenants or lease holders of
resolution, DARAB, ordered, among others, the the CMU, yet it ordered the "segregation of a suitable
compact and contiguous area of Four Hundred hectares,
more or less", from the CMU land reservation, and
directed the DAR Regional Director to implement its
order of segregation. Having found that the complainants
in this agrarian dispute for Declaration of Tenancy Status
are not entitled to claim as beneficiaries of the CARP
because they are not share tenants or leaseholders, its
order for the segregation of 400 hectares of the CMU
land was without legal authority. w do not believe that the
quasi-judicial function of the DARAB carries with it
greater authority than ordinary courts to make an award
beyond what was demanded by the
complainants/petitioners, even in an agrarian dispute.
Where the quasi-judicial body finds that the
complainants/petitioners are not entitled to the rights they
are demanding, it is an erroneous interpretation of
authority for that quasi-judicial body to order private
property to be awarded to future beneficiaries. The order
segregation 400 hectares of the CMU land was issued on
a finding that the complainants are not entitled as
beneficiaries, and on an erroneous assumption that the
CMU land which is excluded or exempted under the law
is subject to the coverage of the CARP. Going beyond
what was asked by the complainants who were not
entitled to the relief prayed the complainants who were
not entitled to the relief prayed for, constitutes a grave
abuse of discretion because it implies such capricious
and whimsical exercise of judgment as is equivalent to
lack of jurisdiction.
to substantiate their (sic) allegation that the properties
are indeed in the municipalitys residential and forest
REPUBLIC OF THE PHILIPPINES rep. by the conservation zone and that portions of the properties are
DEPARTMENT OF AGRARIAN REFORM, petitioner, vs. not irrigated nor irrigable.
& DEVELOPMENT CORPORATION, respondents. Private respondent filed an Amended Petition for
Exemption/Exclusion from CARP coverage. This time,
Facts: Five parcels of land in Rizal has a combined area private respondent alleged that the property should be
of approximately 112.0577 hectares covered by TCT. exempted since it is within the residential and forest
Private respondent acquired the land by purchase on conservation zones of the town plan/zoning ordinance of
May 26, 1994 from Marcela Borja vda. De Torres. The Jala-Jala. The amended petition for exemption showed
tax declarations classified the properties as agricultural.
that a portion of about 15 hectares of the land is irrigated
Petitioner DAR issued a Notice of Coverage of the riceland which private respondent offered to sell to the
subject parcels of land under compulsory acquisition farmer beneficiaries or to the DAR
pursuant to Section 7, Chapter II of R.A. 6657 or the The DAR Secretary issued an Order denying the
Comprehensive Land Reform Law of 1998 (CARL). application for exemption of private respondent, on the
DAR grounds that the land use plan of Jala-Jala, which differs
from its land use map, intends to develop 73% of
Private respondent filed with the DAR Regional Office an Barangay Punta into an agricultural zone; that the
application for exemption of the land from agrarian certification issued by the Housing and Land Use
reform. Administrative Order No. 6 provides the Regulatory Board (HLURB) is not definite and specific;
guidelines for exemption from the Comprehensive and that the certification issued by the National Irrigation
Agrarian Reform Program (CARP) coverage. DOJ Authority (NIA) that the area is not irrigated nor
Opinion No. 44, Series of 1990, authorizes the DAR to programmed for irrigation, is not conclusive on the DAR,
approve conversion of agricultural lands covered by RA since big areas in the municipality are recipients of JICA-
6651 to non-agricultural uses effective June 15 1988. funded Integrated Jala-Jala Rural Development Projects.

The DAR Regional Director recommended a denial of the

said petition, on the ground that private respondent failed
Court of Appeals
Private respondent appealed to the CA. The CA created The team of commissioners appointed by respondent
a commission composed of three (3) members tasked to court was composed persons who were mutually
conduct an ocular inspection and survey of the subject acceptable to the parties.[22] Thus, in the absence of any
parcels of land and to submit a report on the result of irregularity in the survey and inspection of the subject
such inspection and survey. To verify the report of the properties, and none is alleged, the report of the
commission, the DAR constituted its own team to inspect commissioners deserves full faith and credit and we find
and report on the property in question. The verification no reversible error in the reliance by the appellate court
report of the DAR, duly filed with the Court of Appeals, upon said report.
objected to the report of the commission mainly due to
the lack of specific boundaries delineating the surveyed Republic Act No. 6657 otherwise known as the
areas. Comprehensive Agrarian Reform Law (CARL) of 1998
covers all public and private agricultural lands. The same
The Court of Appeals issued its Decision that reversed law defines agricultural as land devoted to agricultural
the assailed DAR orders. activity as defined in this Act and not classified as
mineral, forest, residential, commercial or industrial land.
Issue: Whether or not the parcels of land are exempt
from the coverage of CARL Moreover, the commissioners report on the actual
condition of the properties confirms the fact that the
Yes. Private respondent sought exemption from the properties are not wholly agricultural. In essence, the
coverage of CARL on the ground that its five parcels of report of the commission showed that the land of private
land are not wholly agricultural. The determination of the respondent consists of a mountainous area with an
classification and physical condition of the lands is average 28 degree slope containing 66.5 hectares; a
therefore material in the disposition of this case, for which level, unirrigated area of 34 hectares of which 5 to 6
purpose the Court of Appeals constituted the commission hectares are planted to palay; and a residential area of 8
to inspect and survey said properties. Petitioner DAR did hectares. The finding that 66.5 hectares of the 112.0577
not object to the creation of a team of commissioners[21] hectares of land of private respondent have an average
when it very well knew that the survey and ocular slope of 28 degrees provides another cogent reason to
inspection would eventually involve the determination of exempt these portions of the properties from the CARL.
the slope of the subject parcels of land. It is the Section 10 of the CARL is clear on this point when it
protestation of petitioner that comes at a belated hour. provides that all lands with eighteen percent (18%) slope
and over, except those already developed shall be The Municipal Agrarian Reform Officer (MARO) found
exempt from the coverage of this Act. hectares of the land were "flat to undulating (0-8%
slope)" and actually occupied and cultivated by several
tillers of sugarcane. A "Summary Investigation Report"
Roxas & Co vs CA was submitted recommending that a portion of the
Hacienda Palico and Banilad be subject to compulsory
Facts: acquisition in exchange for a certain compensation.

Roxas & Co. own three haciendas (Haciendas Palico, DAR sent a "Notice of Acquisition" to Roxas & Co
Banilad and Caylaway) in Batangas. informing them that the Haciendas were subject to
immediate acquisition and distribution by the government
In 1987, President Aquino signed Proclamation No. 131
under the CARL; that the government was offering
instituting a Comprehensive Agrarian Reform Program
compensation in exchange of the land; that the company
and Executive Order No. 229 providing the mechanisms
should inform the DAR of its acceptance or rejection of
necessary to initially implement the program. In 1988, the
the price; that in case of rejection or failure to reply within
Congress passed RA 6657, the Comprehensive Agrarian
thirty days, DAR shall conduct summary administrative
Reform Law (CARL).
proceedings to determine just compensation for the land;
Before the law's effectivity, Roxas & Co filed with DAR a that upon payment, in case the offer is accepted, or
voluntary offer to sell Hacienda Caylaway pursuant to the deposit of payment to a bank in case of rejection of the
provisions of E.O. No. 229. Haciendas Palico and offer, the DAR shall take immediate possession of the
Banilad were later placed under compulsory acquisition land.
by respondent DAR in accordance with the CARL.
In 1991, the DAR opened a trust account with the LBP
HACIENDA PALICO and HACIENDA BANILAD representing the valuation of the in view of the
corporation’s rejection of its offered value.
DAR sent a notice to Roxas & co entitled "Invitation to
Parties”, inviting the company to a conference on to In 1993, Roxas & Co applied with the DAR for conversion
discuss the results of the DAR investigation of of Haciendas Palico and Banilad from agricultural to
Haciendas, which were scheduled for compulsory nonagricultural lands under the provisions of the CARL.
acquisition this year under the CARP. Despite such application, the DAR proceeded with the
acquisition of the two Haciendas. The DAR registered a Despite the denial of the withdrawal, the company filed its
Certificate of Land Ownership Award (CLOA) from the application for conversion of both Haciendas Palico and
mother title of the Hacienda and the CLOAs were Banilad.
distributed to the farmers.
Roxas & Co filed a petition with the DARAB praying for
HACIENDA CAYLAWAY the cancellation of the CLOA's issued by DAR alleging
that the Municipality of Nasugbu, where the haciendas
Hacienda Caylaway was voluntarily offered for sale to the are located, had been declared a tourist zone, that the
government on before the effectivity of the CARL. The land is not suitable for agricultural production, and that
DAR accepted the offer and sent Roxas & Co a "Notice the Sangguniang Bayan of Nasugbu had reclassified the
of Acquisition" over the land. land to non-agricultural.
The company later sent a letter to the DAR withdrawing DARAB held that the case involved the prejudicial
its voluntary offer of sale of Hacienda Caylaway. The question of whether the property was subject to agrarian
Sangguniang Bayan of Nasugbu, Batangas allegedly reform, hence, this question should be submitted to the
authorized the reclassification of Hacienda Caylaway Office of the Secretary of Agrarian Reform for
from agricultural to non-agricultural. As a result, the determination.
company informed DAR that it was applying for
conversion of Hacienda Caylaway from agricultural to Roxas & Co filed a petition with the CA questioning the
other uses. expropriation of its properties under the CARL and the
denial of due process in the acquisition of its
The DAR informed the company that a reclassification of landholdings. The CA denied the petition.
the land would not exempt it from agrarian reform and
denied it’s withdrawal of the offer on the ground that Issue:
withdrawal could only be based on specific grounds such
as unsuitability of the soil for agriculture, or if the slope of Whether or not the acquisition of the three haciendas
the land is over 18 degrees and that the land is were valid and in accordance with law
undeveloped. Held:

A. Modes of Acquisition of Land under R. A. 6657

CARL provides for two modes of acquisition of private with an accessible bank. The DAR shall immediately take
land: compulsory and voluntary. possession of the land and cause the issuance of a
transfer certificate of title in the name of the Republic of
In both modes of acquisition, the landholding, the the Philippines. The land shall then be redistributed to the
landowners and the farmer beneficiaries must first be farmer beneficiaries. Any party may question the decision
identified. After identification, the DAR shall send a of the DAR in the regular courts for final determination of
Notice of Acquisition to the landowner, and post it in a just compensation.
conspicuous place in the municipal building and
barangay hall of the place where the property is located. For a valid implementation of the CAR program, two
Within thirty days from receipt of the Notice of notices are required: (1) the Notice of Coverage and
Acquisition, the landowner, his administrator or letter of invitation to a preliminary conference; and (2) the
representative shall inform the DAR of his acceptance or Notice of Acquisition sent to the landowner.
rejection of the offer. If the landowner accepts, he
executes and delivers a deed of transfer in favor of the B. The Acquisition of the Three Haciendas
government and surrenders the certificate of title. Within DAR claims that it sent a letter of invitation entitled
thirty days from the execution of the deed of transfer, the "Invitation to Parties" to the corporation. No letter of
Land Bank of the Philippines (LBP) pays the owner the invitation was sent or conference meeting held with
purchase price. If the landowner rejects the DAR's offer respect to Hacienda Caylaway because it was subject to
or fails to make a reply, the DAR conducts summary a Voluntary Offer to Sell. However, the notices were sent
administrative proceedings to determine just to the administrator of the Haciendas. There is no
compensation for the land. The landowner, the LBP showing that the administrator is an agent of the
representative and other interested parties may submit company or is authorized to attend the conference
evidence on just compensation within fifteen days from meeting. On the contrary, the corporation claims that it
notice. Within thirty days from submission, the DAR shall had no knowledge of the letter-invitation.
decide the case and inform the owner of its decision and
the amount of just compensation. Upon receipt by the Moreover, the areas found actually subject to CARP were
owner of the corresponding payment, or, in case of not properly identified before they were taken over by the
rejection or lack of response from the latter, the DAR DAR. The acquisition of the landholdings did not cover
shall deposit the compensation in cash or in LBP bonds the entire expanse of the haciendas. The haciendas are
not entirely agricultural lands, but "sugarland" and "forest, Development Plan and Zoning Ordinance of the Municipality of Alabel, Sarangani Per
sugarland, pasture land, horticulture and woodland." Resolution No. 97-08 and Municipal Ordinance No. 97-08, S. of 1997 of the
Sangguniang Bayan of Alabel.
Before Notices of Acquisition were sent, the exact areas
of the landholdings were not properly segregated and A portion of the area involving 376.5424 hectares, however, was covered
delineated. Upon receipt of this notice, therefore, the by the CARP commercial farms deferment scheme. The Zoning Certification issued by
corporation had no idea which portions of its estate were the office of the Municipal Planning and Development Council (MPDC) showed that
subject to compulsory acquisition, which portions it could respondents properties located at Barangay Maribulan, Alabel were among those
rightfully retain, whether these retained portions were reclassified from agricultural and pasture land to residential, commercial institutional,
compact or contiguous, and which portions were light industrial and open space in the1995-2005 land use plan of Alabel. The
excluded from CARP coverage. respondent then field an application for land use conversion of certain parcels of land.

Meanwhile, members of the Sarangani Agrarian Reform Beneficiaries Association,

The acquisition proceedings over the three haciendas are
Inc. (SARBAI) sent a letter-petition to the DAR Secretary opposing the application for
nullified for DAR's failure to observe due process. The
land use conversion filed by SACI. SARBAI alleged that its members were merely
case is remanded to DAR for proper acquisition
forced to sign the waiver of rights, considering that the commercial farm deferment
proceedings and determination of the application for
period ended on June 15, 1998. Later, the PLUTC agreed to recommend the
disapproval of a portion of a property which was still viable for agriculture. The

DAR vs Sarangani conversion was deferred subject to the submission of certain requirements. Later, the
DAR Secretary denied SACI application for land use conversion. On November 9,
Facts: 2000, DAR Secretary Horacio R. Morales, Jr. denied SACI s application for land use

conversion. SACI appealed to the Office of the President. The Office of the President
The Sangguniang Bayan of Alabel, Sarangani passed Resolution No. 97-08 adopting
dismissed the appeal and affirmed in toto the challenged DAR Orders. Respondents
a 10 year comprehensive development plan of the municipality and its land use. On
motion for reconsideration was denied, so they filed with the Court of Appeals a
January 30, 1998, pursuant to Municipal Zoning Ordinance No. 08, Series of 1997,
petition for review raising substantially the same issues. The CA granted the petition
and to accelerate the development and urbanization of Alabel, the Sangguniang
and ordered DAR to issue a conversion order. As to the deferred portion, DAR was
Bayan of Alabel passed Resolution No. 98-03 reclassifying lots that were located
directed to expedite the processing and evaluation of petitioner’s application.
within the built-up areas, based on the 1995-2005 Land Use Plan of the municipality,

from agricultural to non-agricultural uses. Later, the Sangguniang Panlalawigan of Issue:

Sarangani approved Resolution No. 98-018 or the Resolution Adopting the Ten-Year
Municipal Comprehensive Development Plan (MCDP 1995-2205) and the Land Use WON a notice of coverage is an indispensable requirement for the acquisition of land
Held: The conversion of agricultural lands into non-agricultural uses shall be

strictly regulated and may be allowed only when the conditions prescribed under R.A.
No, Under the circumstances, a notice of coverage is not an indispensable
No. 6657 are present. In this regard, the Court agrees with the ratiocination of the CA
requirement before DAR can acquire the subject lots or commercial farms, which are
that DAR scope of authority in assessing land use conversion applications is limited to
covered by a deferment period under the Comprehensive Agrarian Reform Law
examining whether the requirements prescribed by law and existing rules and
(CARL) or R.A. No 6657 upon its effectivity on June 15, 1998
regulations have been complied with. This holds true in the present case where,

Issue: because of the creation of the Province of Sarangani and in view of its thrust to

urbanize, particularly its provincial capital which is the Municipality of Alabel, the local
WON the DAR should use the comprehensive land use plans and ordinance of the government has reclassified certain portions of its land area from agricultural to non-
local sanggunian as primary reference agricultural. Thus, to reiterate, in accordance with E.O. No. 72, Series of 1993, and

subject to the limitations prescribed by law, DAR should utilize the comprehensive
land use plans in evaluating the land use conversion application of respondents

Held: Yes, Section 20 of Republic Act No. 7160, otherwise known as the Local whose lands have already been reclassified by the local government for non-

Government Code of 1991,empowers the local government units to reclassify agricultural uses. This is not to say, however, that every property of respondents

agricultural lands. Memorandum Circular No. 54 Prescribing the Guidelines Governing which is included in the comprehensive land use plan of the Municipality of Alabel

Section 20 of R.A. No. 7160 Otherwise Known as the Local Government Code of 1991 shall be automatically granted non-coverage. As mentioned earlier, said application is

Authorizing Cities and Municipalities to Reclassify Agricultural Lands Into Non- subject to the limitations and conditions prescribed by law. One such limitation that

Agricultural Uses issued by President Ramos on June 8, 1993 specified the scope and is presen there is that a portion of respondents property of 376.5424 hectares, a

limitations on the power of the cities and municipalities to reclassify agricultural lands portion totalling 154.622 [or 154.1622] hectares which are planted to bananas and

into other uses. It provided that all ordinances authorizing reclassification of coconuts, are covered by CARL ten-year deferment scheme, which has expired on

agricultural lands shall be subject to the review and approval of the province in the June 15, 1998. By law, these lands are subject to redistribution to CARP beneficiaries

case of component cities or municipalities, or by the HLURB for highly urbanized or upon the lapse of the ten-year period, counted from the date of the effectivity of the

independent component cities in accordance with Executive Order No. 72, Series of CARL or R.A. No. 6657 on June 15,1988, which was way before the creation of the

1993. Hence, with regard to agricultural lands that have been reclassified for non- Province of Sarangani and the eventual reclassification of the agricultural lands into

agricultural uses by the local government unit concerned, the CA is correct in non-agricultural in the Municipality of Alabel where respondents properties are

declaring that DAR should refer to the comprehensive land use plans and the located. In short, the creation of the new Province of Sarangani, and the

ordinances of the Sanggunian in assessing land use conversion applications. reclassification that was effected by the Municipality of Alabel did not operate to

supersede the applicable provisions of R.A. No. 6657. Moreover, Section 20 of the

LGC of 1991 on the reclassification of lands explicitly states that nothing in this section
shall be construed as repealing, amending or modifying in any manner the provisions Held
of R.A. No.6657. Thus, where the law speaks in clear and categorical language, there
Petitioners is correct in saying that PD 27decreeing the
is no room for interpretation. There is only room for application.
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
Alita vs CA promulgated pursuant to the social justice precepts of the
Constitution. However, such contention cannot be
invoked to defeat the very purpose of the enactment of
Facts: the Public Land Act or Commonwealth Act NO 141. The
Philippine constitution likewise respects the superiority of
Private respondents’ predecessors-in-interest acquired
the homesteader’s rights over the rights of the tenants
the subject parcels of lands through homestead patent
guaranteed by the Agrarian Reform statute. Provided,
under the provisions of Commonwealth Act No. 141.
that the original homestead grantees or their direct
Private respondents are desirous of personally cultivating
compulsory heirs who still own the original homestead at
these lands, but petitioners refuse to vacate, relying on
the time of the approval of this Act shall retain the same
the provisions of PD. 27 and PD 316. Private respondent
areas as long as they continue to cultivate said
instituted a complaint for the declaration of PD 27 and all
other Decrees, Letter of Instructions and General Orders
issued in connection therewith as inapplicable to lands
obtained through homestead law. The RTC dismissed
the complaint but on motion for reconsideration it
declared that PD 27 is not applicable to homestead Daez vs Ca & Macario Sorientes
lands. On appeal to the CA, the decision of the RTC was
sustained Facts:

Issue Eudosia Daez, now deceased, was the owner of a

4.1685-hectare riceland in Barangay Lawa, Meycauayan,
Whether or not lands acquired through homestead law Bulacan which was being cultivated by respondents
are covered by the CARP Macario Soriente, Rogelio Macatulad, Apolonio Mediana
and Manuel Umali under a system of share-tenancy. The
said land was subjected to the Operation Land Transfer Under Petition for certiorari he filed an Appeal in C.A but
(OLT) Program under Presidential Decree (P.D.) No. C.A Sustain the decision of the DAR. And She filed a
27 as amended by Letter of Instruction (LOI) No. 474. petition in S.C but still denied on Nov 9 1992.
Thus, the then Ministry of Agrarian Reform acquired the
subject land and issued Certificates of Land Transfer Since the Exeption in P.D 27 having been finally denied
(CLT) on December 9, 1980 to private respondents as her Eudosia Daez next filed an application for retention of
the same riceland, under R.A. No. 6657.
However, on May 31, 1981, private respondents signed In an order dated March 22, 1994, DAR Region III OIC-
an affidavit, allegedly under duress, stating that they are
Director Eugenio B. Bernardo allowed Eudosia Daez to
not share tenants but hired laborers. Armed with such
document, Eudosia Daez applied for the exemption of retain the subject riceland but he denied the application
said riceland from coverage of P.D. No. 27 due to non- of her eight (8) children to retain three (3) hectares each
tenancy as well as for the cancellation of the CLTs issued for their failure to prove actual tillage of the land or direct
to private respondents. management thereof as required by law.

On July 27, 1987, DAR Undersecretary Jose C. Medina Eudosia Daez filed a Motion for Reconsideration but it
issued an Order denying Eudosia Daezs application for was denied on January 19, 1995.
exemption upon finding that her subject land is covered
She appealed Secretary Garilaos decision to the Office of
under LOI No. 474, petitioner being owner of the
the President which ruled in her favour authorizing the
aforesaid agricultural lands exceeding seven (7)
retention by Eudosia Daez or her heirs of the 4.1685-
hectare landholding subject thereof. Respondents
Eudosia Daez requesting for reconsideration of appealed to the CA which reverse the decision of the
Undersecretary Medinas order but was denied by DAR office of the President.
Secretary Benjamin T. Leong. Secretary Leong
Issue : Whether or not the denial of the application for
disregarded private respondents May 31, 1981 affidavit
exemption under P.D 27 would bar an application for
for having been executed under duress because he
retention under R.A 6657 and
found that Eudosias son, Adriano, who was then the
incumbent Vice-Mayor of Meycauayan, pressured private whether or not Petitioner heirs of Eudosia Daez may
respondents into signing the same. exercise their right over the subj 4.1685 Riceland.
or comparable features.[29]

Decision :

1st Issue : No The right of retention is a constitutionally guaranteed

right, which is subject to qualification by the
The requisites for the grant of an application for legislature.[21] It serves to mitigate the effects of
compulsory land acquisition by balancing the rights of the
exemption from coverage of OLT and those for the grant
landowner and the tenant and by implementing the
of an application for the exercise of a landowners right of doctrine that social justice was not meant to perpetrate
retention, are different. Hence, it is incorrect to posit that an injustice against the landowner[22]. A retained area, as
an application for exemption and an application for its name denotes, is land which is not supposed to
retention are one and the same thing. Being distinct anymore leave the landowners dominion, thus sparing
remedies, finality of judgment in one does not preclude the government from the inconvenience of taking land
the subsequent institution of the other. There was, thus, only to return it to the landowner afterwards, which would
be a pointless process. Xsc
no procedural impediment to the application filed by
Eudosia Daez for the retention of the subject 4.1865- In the landmark case of Association of Small Landowners
hectare riceland, even after her appeal for exemption of in the Phil., Inc. v. Secretary of Agrarian Reform[23], we
the same land was denied in a decision that became final held that landowners who have not yet exercised their
and executory. retention rights under P.D. No. 27 are entitled to the new
retention rights under R.A. No. 6657[24]. We disregarded
the August 27, 1985 deadline imposed by DAR
Administrative Order No. 1, series of 1985 on landowners
2nd issue: Yes covered by OLT. However, if a landowner filed his
application for retention after August 27, 1985 but he had
Without doubt, this right of retention may be exercised previously filed the sworn statements required by LOI
over tenanted land despite even the issuance of Nos. 41, 45 and 52, he is still entitled to the retention limit
Certificate of Land Transfer (CLT) to farmer- of seven (7) hectares under P.D. No.27[25]. Otherwise, he
beneficiaries.[28] What must be protected, however, is is only entitled to retain five (5) hectares under R.A. No.
the right of the tenants to opt to either stay on the 6657.
land chosen to be retained by the landowner or be a
The right to choose the area to be retained, which
beneficiary in another agricultural land with similar
shall be compact or contiguous, shall pertain to the
landowner. Provided, however, That in case the area
selected for retention by the landowner is tenanted,
the tenant shall have the option to choose whether to
remain therein or be a beneficiary in the same or
another agricultural land with similar or comparable
features. In case the tenant chooses to remain in the
retained area, he shall be considered a leaseholder
and shall lose his right to be a beneficiary under this
Act. In case the tenant chooses to be a beneficiary in
another agricultural land, he loses his right as a
lease-holder to the land retained by the landowner.
The tenant must exercise this option within a period of
Santiago Vs Ortiz-Luiz
one (1) year from the time the landowner manifests his
choice of the area for retention. Facts:

Juan and Amada Ortiz Luis (Spouses Ortiz Luis)were the

owners of 7.1359 hectares of tenanted riceland situated
-S.C decided in favour of the respondents the C.A
in Barangay San Fernando Sur, Cabiao, Nueva Ecija.
decision was reverse and set aside and and the
Pursuant to Presidential Decree No. 27 (P.D. No. 27) the
Decision of the Office of the President is REINSTATED.
property was placed under Operation Land Transfer

Despite the inclusion of the property under the OLT, the

Spouses Ortiz-Luis, by Deed of Absolute Sale dated
June 16, 1979, transferred it to their children Rosario,
Teresita, Simplicio and Antonio, all surnamed Ortiz-Luis.

The children later filed an Application for Retention under

P.D. No. 27 before the Department of Agrarian Reform
Regional Office (DARRO) but were denied on the ground
that the transfer was made after October 21, 1972, which beneficiary should be accorded their rights under RA
is a clear violation of agrarian laws, rules and regulation. 6657 Section 6 and Dar Amdin Order no. 05-00.

Seperately, Amanda applied for retention. Provincial Issue: Whether or Not Amanda is entitled with retention
agrarian Reform Officer (PARO) Rogelio M. Chavez rights.

Recommended the denial of amandas Application upon Decision:

the ground that “ an owner of tenanted rice and corn
lands may not retain their own lands if he, as of October No, Sec PANGADAMAN Decision is reinstated.
21, 1972 owned more than 24 hectares of teneanted rice
and corn lands. It appears that Ortiz Luis owned 178.8 The legislative standards are set forth in Section 6 of
hectares only 88.5 of which were placed under OLT. R.A. 6657, thus:

In 2000, Amandas application for retention was granted. Section 6. Retention Limits. – Except as otherwise
The PARO held that her failure to exercise her retention provided in this Act, no person may own, or retain,
in PD27 entitled her to the benefit of retention under RA directly or indirectly, any public or private agricultural
6657. land, the size of which shall vary according to factors
governing a viable family-size, such as commodity
This was contested by the farmers-beneficiaries who produced, terrain, infrastructure, and soil fertility as
received emancipation patents over the portion of the determined by the Presidential Agrarian Reform Council
property, namely Santiago and Gutierrez (PARC) created hereunder, but in no case shall retention
by the landowner exceed five (5) hectares. Three (3)
Upon appeal with the DAR Secretary, PAGDANGANAN hectares may be awarded to each child of the landowner,
Upheald the decision of PARO holding that Amanda was subject to the following qualifications: (1) that he is at
entitiled for the retention. His successor, Sec least fifteen (15) years of age; and (2) that he is actually
PANGADAMAN however reverse relying on LOI 474 tilling the land or directly managing the farm; Provided,
ststing that having established that the landowners own That landowners whose land have been covered by
other agricultural land 7 hectares, they are not entitled to Presidential Decree No. 27 shall be allowed to keep the
retention under PD 27. On appeal to the Office of the area originally retained by them thereunder, Provided
President, the order of PAGDANGANAN was upheld further, That the original homestead grantees or direct
granting Amanda retention rights. This decision was compulsory heirs who still own the original homestead at
upheld by the CA, with the clarification that the farmers- the time of the approval of this Act shall retain the same
areas as long as they continue to cultivate said Tenanted rice/corn lands with areas of seven hectares or
homestead. less shall be covered by Operation Land Transfer if those
lands belong to the following landowners:

a.) Landowners who own other agricultural lands

The right to choose the area to be retained, which shall of more than seven hectares in aggregate areas,
be compact or contiguous, shall pertain to the whether tenanted or not, cultivated or not, and
landowner. Provided, however, That in case the area regardless of the income derived therefrom;
selected for retention by the landowner is tenanted, the
tenant shall have the option to choose whether to remain b.) Landowners who own lands used for
therein or be a beneficiary in the same or another residential, commercial, industrial or other urban
agricultural land with similar or comparable features. purposes from which they derive an annual gross
income of at least five thousand (P5,000.00)
Section 6 implies that the sole requirement in the pesos. (underscoring supplied)
exercise of retention rights is that the area chosen by the
landowner must be compact or contiguous. Letter of Instruction (LOI) No. 474 amended P.D. No. 27
by removing "any right of retention from persons who
"1. You shall undertake to place under the Land Transfer own other agricultural lands of more than 7 hectares, or
Program of the government pursuant to Presidential lands used for residential, commercial, industrial or other
Decree No. 27, all tenanted rice/corn lands with areas of purpose from which they derive adequate income to
seven hectares or less belonging to landowners who own support themselves and their families."
other agricultural lands of more than seven hectares in
aggregate areas or lands used for residential, Section 9 (d) of DAR Administrative Order No. 05, on
commercial, industrial or other urban purposes from which the Court of Appeals in part anchored its ruling, is
which they derive adequate income to support inconsistent with P.D. No. 27, as amended by LOI No.
themselves and their families." (underscoring supplied) 474, insofar as it removed the limitations to a landowner’s
retention rights.
DAR Memorandum Circular No. 11, Series of
Natalia Realty vs DAR
197818 provided for the implementing guidelines of LOI
No. 474:
-Petitioner Natalia Realty, Inc. (NATALIA, for brevity) is - Phase II, with an area of 80,000 hectares, on 13
the owner of three (3) contiguous parcels of land located October 1983; and for Phase III, which consisted of the
in Banaba, Antipolo, Rizal, with areas of 120.9793 remaining 31.7707 hectares, on 25 April 1986. Petitioner
hectares, 1.3205 hectares and 2.7080 hectares, or a total were likewise issued development permits after
of 125.0078 hectares, and embraced in Transfer complying with the requirements. Thus the NATALIA
Certificate of Title No. 31527 of the Register of Deeds of properties later became the Antipolo Hills Subdivision.
the Province of Rizal.

- Department of Agrarian Reform (DAR, for brevity),

- On 18 April 1979, Presidential Proclamation No. 1637 through its Municipal Agrarian Reform Officer, issued on
set aside 20,312 hectares of land located in the 22 November 1990 a Notice of Coverage on the
Municipalities of Antipolo, San Mateo and Montalban as undeveloped portions of the Antipolo Hills Subdivision
townsite areas to absorb the population overspill in the which consisted of roughly 90.3307 hectares. NATALIA
metropolis which were designated as the Lungsod immediately registered its objection to the notice of
Silangan Townsite. The NATALIA properties are situated Coverage.
within the areas proclaimed as townsite reservation.

- Samahan ng Magsasaka sa Bundok Antipolo, Inc.

-petitioner Estate Developers and Investors Corporation (SAMBA, for the brevity), filed a complaint against
(EDIC, for brevity), as developer of NATALIA properties, NATALIA and EDIC before the DAR Regional Adjudicator
applied for and was granted preliminary approval and to restrain petitioners from developing areas under
locational clearances by the Human Settlements cultivation by SAMBA members.
Regulatory Commission. The necessary permit for Phase
I of the subdivision project, which consisted of 13.2371 - NATALIA and EDIC both impute grave abuse of
hectares, was issued sometime in 1982 discretion to respondent DAR for including
undedeveloped portions of the Antipolo Hills Subdivision
within the coverage of the CARL. They argue that
NATALIA properties already ceased to be agricultural
lands when they were included in the areas reserved by
presidential fiat for the townsite reservation.
-Public respondents through the Office of the Solicitor Sec. 4 of RA 6657 states that the CARL covers
General dispute this contention. They maintain that the "regardless of tenurial arrangement and commodity
permits granted petitioners were not valid and binding produced, all public and private and agricultural lands"
because they did not comply with the implementing and as per the transcripts of the Constitutional
Standards, Rules and Regulations of P.D. 957, otherwise Commission, "agricultural lands" covered by agrarian
known as "The Subdivision and Condominium Buyers reform refers only to those which are "arable and suitable
Protective Decree," in that no application for conversion lands" and "do not include commercial, industrial and
of the NATALIA lands from agricultural residential was residential lands." The land subject of the controversy
ever filed with the DAR. In other words, there was no has been set aside for the Lungsod Silangan Reservation
valid conversion. Moreover, public respondents allege by Proclamation No. 1637 prior to the effectivity of RA
that the instant petition was prematurely filed because 6657 and in effect converted these lands into residential
the case instituted by SAMBA against petitioners before use. Since the Natalia lands were converted prior to 15
the DAR Regional Adjudicator has not yet terminated. June 1988, DAR is bound by such conversion, and thus it
Respondents conclude, as a consequence, that was an error to include these within the coverage of
petitioners failed to fully exhaust administrative remedies CARL.
available to them before coming to court.

DAR vs Sutton

Are lands already classified for residential, commercial or

industrial use, and approved by HLURB and its precursor -The case at bar involves a land in Aroroy, Masbate,
agencies prior to 15 June 1988, covered by RA 6657? inherited by respondents which has been devoted
exclusively to cow and calf breeding. On October 26,
1987, pursuant to the then existing agrarian reform
program of the government, respondents made a
voluntary offer to sell (VOS)their landholdings to
Held: petitioner DAR to avail of certain incentives under the
- On October 9, 2001, the Office of the President affirmed
the impugned Order of petitioner DAR. It ruled that DAR
- On December 21, 1992, the Municipal Agrarian Reform A.O. No. 9, s. 1993, does not run counter to the Luz
Officer of Aroroy, Masbate, inspected respondents land Farms case as the A.O. provided the guidelines to
and found that it was devoted solely to cattle-raising and determine whether a certain parcel of land is being used
breeding. He recommended to the DAR Secretary that it for cattle-raising. However, the issue on the
be exempted from the coverage of the CARL.
constitutionality of the assailed A.O. was left for the
- On April 27, 1993, respondents reiterated to petitioner determination of the courts as the sole arbiters of
DAR the withdrawal of their VOS and requested the such issue.
return of the supporting papers they submitted in
connection therewith.
Whether of not DAR A.O No.9 is unconstitutional?
- On September 14, 1995, then DAR Secretary Ernesto
D. Garilao issued an Order partially granting the Held:
application of respondents for exemption from the
coverage of CARL. Applying the retention limits outlined
in the DAR A.O. No. 9, petitioner exempted 1,209 Administrative agencies are endowed with powers
hectares of respondents land for grazing purposes, and a legislative in nature. They have been granted by
maximum of 102.5635 hectares for infrastructure. Congress with the authority to issue rules to regulate the
Petitioner ordered the rest of respondents landholding to implementation of a law entrusted to them. Delegated
be segregated and placed under Compulsory Acquisition. rule-making has become a practical necessity in modern
governance due to the increasing complexity and variety
of public functions. However, while administrative rules
and regulations have the force and effect of law, they are
- Respondents moved for reconsideration. They contend
not immune from judicial review. They may be properly
that their entire landholding should be exempted as it is
challenged before the courts to ensure that they do not
devoted exclusively to cattle-raising.
violate the Constitution and no grave abuse of
administrative discretion is committed by the
administrative body concerned.
Petitioner DAR has no power to regulate livestock farms
The fundamental rule in administrative law is that, which have been exempted by the Constitution from the
to be valid, administrative rules and regulations must be coverage of agrarian reform. It has exceeded its power
issued by authority of a law and must not contravene the in issuing the assailed A.O.
provisions of the Constitution. The rule-making power of
an administrative agency may not be used to abridge the Respondents’ family acquired their landholdings as early
authority given to it by Congress or by the as 1948. They have long been in the business of
Constitution. Nor can it be used to enlarge the power of breeding cattle in Masbate which is popularly known as
the administrative agency beyond the scope the cattle-breeding capital of the Philippines. Petitioner
intended. Constitutional and statutory provisions control DAR does not dispute this fact. Indeed, there is no
with respect to what rules and regulations may be evidence on record that respondents have just recently
promulgated by administrative agencies and the scope of engaged in or converted to the business of breeding
their regulations. cattle after the enactment of the CARL that may lead one
to suspect that respondents intended to evade its
In the case at bar, SC find that the impugned A.O. is coverage. It must be stressed that what the CARL
invalid as it contravenes the Constitution. The A.O. prohibits is the conversion of agricultural lands for non-
sought to regulate livestock farms by including them in agricultural purposes after the effectivity of the
the coverage of agrarian reform and prescribing a CARL. There has been no change of business interest in
maximum retention limit for their ownership. However, the case of respondents.
the deliberations of the 1987 Constitutional Commission
show a clear intent to exclude, inter alia, all lands It is a fundamental rule of statutory construction that the
exclusively devoted to livestock, swine and poultry- reenactment of a statute by Congress without substantial
raising. The Court clarified in the Luz Farms case that change is an implied legislative approval and adoption of
livestock, swine and poultry-raising are industrial the previous law. On the other hand, by making a new
activities and do not fall within the definition of law, Congress seeks to supersede an earlier one. In the
“agriculture” or “agricultural activity.” The raising of case at bar, after the passage of the 1988 CARL,
livestock, swine and poultry is different from crop or tree Congress enacted R.A. No. 7881 which amended certain
farming. It is an industrial, not an agricultural, activity. provisions of the CARL. Specifically, the new law
changed the definition of the terms “agricultural activity” knowledge of the CA – as the parties did not inform the
and “commercial farming” by dropping from its coverage appellate court – then DAR Secretary Villa issued DAR
lands that are devoted to commercial livestock, poultry conversion order granting petitioner’s application to
and swine-raising. With this significant modification, convert portions of the 316.0422-hectare property from
Congress clearly sought to align the provisions of our agricultural to residential and golf courses use. The
agrarian laws with the intent of the 1987 Constitutional portions converted was with a total area of 153.3049
Commission to exclude livestock farms from the hectares. With this Conversion Order, the area of the
coverage of agrarian reform. property subject of the controversy was effectively
reduced to 162.7373 hectares.

With the CA now made aware of these developments,

particularly Secretary Villa’s Conversion Order, CA had to
acknowledge that the property subject of the controversy
would now be limited to the remaining 162.7373
MILESTONE FARMS INC. VS. OFFICE OF THE hectares. CA, in its amended decision, states that the
PRESIDENT subject landholding from the coverage of CARP is hereby
lifted, and the 162.7373 hectare-agricultural portion
Facts: In May 1993, petitioner Milestone Farms applied
thereof is hereby declared covered by the CARP.
for the exemption/exclusion of its 316.0422-hectare
property, located in Pinugay, Baras, Rizal, from the ISSUE: Whether or not Milestone’s property should be
coverage of the CARL, pursuant to the ruling of the court exempted from the coverage of CARP.
in the case of Luz Farms that agricultural lands devoted
to livestock, poultry, and/or swine raising are excluded
from the Comprehensive Agrarian Reform Program Ruling: No. The Supreme Court is of the opinion that
(CARP). The DARs Land Use Conversion and Exemption the Court of Appeals and Office of the President correctly
Committee (LUCEC) recommended the exemption of held that the subject property is not exempt from the
petitioners 316.0422-hectare property from the coverage coverage of the CARP, as substantial pieces of evidence
of CARP. The CA primarily ruled in favor of Milestone in show that the said property is not exclusively devoted to
exempting the entire property from the coverage of livestock, swine, and/or poultry raising.
CARP. However, six months earlier, without the
must be actually, directly and exclusively used for
educational purposes.
Issue: Whether or not the subject properties are exempt
from the coverage of CARL.

Facts: Esteban Jalandoni donated the land in dispute

herein to respondent DECS. Thereafter, DECS leased
the lands to Anglo Agricultural Corporation for 10 Ruling: The Supreme Court ruled in favor of petitioner.
agricultural crop years and was subsequently renewed And further discussed that in order to be exempt from the
for another 10 years. MARO Jacinto R. Piosa, sent a coverage of CARL: 1) the land must be actually, directly,
Notice of Coverage to respondent DECS, stating that the and exclusively used and found to be necessary; and 2)
subject lands are now covered by CARP and inviting its the purpose is for school sites and campuses, including
representatives for a conference with the farmer experimental farm stations operated by public or private
beneficiaries. Hence, respondent DECS sought schools for educational purposes. Hence, when DECS
exemption from CARP coverage on the ground that all leased the land to Anglo Corporation for agricultural
the income derived from its contract of lease with Anglo purposes and not as those mentioned exemptions, the
Agricultural Corporation were actually, directly and subject land herein form part of the lands covered by the
exclusively used for educational purposes, such as for CARP.
the repairs and renovations of schools in the nearby Province of Camarines Sur vs CA, 1993 [G.R. No.
locality. However, petitioner DAR, on the other hand,
argued that the lands subject hereof are not exempt from
the CARP coverage because the same are not actually,
directly and exclusively used as school sites or
campuses, as they are in fact leased to Anglo Agricultural
The Sangguniang Panlalawigan of Camarines Sur
Corporation. Further, to be exempt from the coverage, it
passed a Resolution authorizing the Governor to
is the land per se, not the income derived therefrom, that
purchase or expropriate property near the capitol site, in
order to establish a pilot farm for non-food and non-
traditional agricultural crops and a housing project for The Court of Appeals ordered the suspension of the
provincial government employees. expropriation proceedings until the Province acquire the
approval of the DAR to convert the classification of the
property from agricultural to non-agricultural land.
Pursuant to the Resolution, the Governor filed cases for
expropriation against the San Joaquins and the trial court
issued a writ of possession. Issue:

Whether or not the expropriation of agricultural lands by

The San Joaquins asked for: (i) the dismissal of the LGUs is subject to the prior approval of the DAR, as the
complaints for expropriation on the ground of the implementator of the agrarian reform program
inadequacy of the compensation and (ii) the nullification
of the resolution.

The Province claimed that it has the authority to initiate Section 9 of the Local Government Code provides:
the expropriation proceedings under the Local
A local government unit may, through its head and acting
Government Code and that the expropriations are for a
pursuant to a resolution of its sanggunian exercise the
public purpose.
right of eminent domain and institute condemnation
proceedings for public use or purpose.

The Solicitor General stated that the Province can

exercise the right of eminent domain. However, the
There is no provision under the Local Government Code
Province must first secure the approval of the DAR of the
and the Comprehensive Agrarian Reform Law that
plan to expropriate the lands for use as a housing project.
requires LGUs to first secure the approval of the DAR for
the conversion of lands from agricultural to non-
agricultural use, before they can institute the necessary
expropriation proceedings. There is also no provision
which expressly subjects the expropriation of agricultural
lands by LGUs to the control of the DAR.

Otherwise, the DAR will have the power to scrutinize

whether the expropriation is for a public purpose or public
use, which ordinarily lies in the legislative branch of the

The rules for determining just compensation are those

laid down in Rule 67 of the Rules of Court, which allow
the owners to submit evidence on what they consider
shall be the just compensation for their property.