AGRARIAN LAW AND SOCIAL LEGISLATION

MIDTERM CASE COMPILATION

1. Association of Small Landowners v. DAR

DOCTRINE/S:

FACTS:
Three cases are involved in this case challenging the constitutionality of several Agrarian Reform Law and other
issuances in relation thereto.

A. 9 hectare / 7 hectare rice land (G.R. No. 79777)

a. Petitioner:
i. Challenges the constitutionality of P.D. No. 27, E.O. Nos. 228 and 229, R.A. No. 6657.
ii. The subjects of this petition are a 9-hectare riceland worked by four tenants and owned by petitioner
Nicolas Manaay and his wife and a 5-hectare riceland worked by four tenants and owned by
petitioner Augustin Hermano, Jr. The tenants were declared full owners of these lands by E.O. No.
228 as qualified farmers under P.D. No. 27.
iii. Contend that P. Aquino usurped legislative power when she promulgated E.O. No. 228
iv. Determination of just compensation should be made only by a court of justice and not by the
President.
v. just compensation is payable in money or in cash and not in the form of bonds or other things
of value.
vi. Due process is violated; put burden on agri-land owners ONLY.
vii. even the small farmers are deprived of their lands and the retention rights guaranteed by the
Constitution.
b. Respondent:
i. the challenge to the order is premature because no valuation of their property has as yet been
made by the Department of Agrarian Reform.
ii. The petitioners are also not proper parties because the lands owned by them do not exceed
the maximum retention limit of 7 hectares.

B. Landowners and sugar planters in the Victorias Mill District; Planters' Committee, Inc. is an organization composed
of 1,400 planter-members. This petition seeks to prohibit the implementation of Proc. No. 131 and E.O. No. 229.
a. Petitioner:
i. President has no power to legislate but could only exercise legislative power until the Congress
was convened and that she could do so only to enact emergency measures during the transition
period.
ii. Challenges Agrarian Reform Fund; this cannot be appropriated YET.
iii. Argues that just compensation should be paid in CASH
iv. Finally, sugar planters should not be lumped to the same class as farmers; hence they should not
be covered by the law.
v. National Federation of Sugarcane Planters (NASP) which claims a membership of at least 20,000
individual sugar planters all over the country INTERVENED. Argued that the 50 Billion initial
allocation has not been certified by the treasury to be available and the failure to establish by
clear and convincing evidence the necessity for the exercise of the powers of eminent domain,
vi. Prudencio Serrano intervened argued:
1. Only public lands should be included in the CARP;
2. violates 1 title 1 subject matter rule
3. The power of the President to legislate was terminated
4. The appropriation of a P50 billion special fund from the National Treasury did not originate
from the House of Representatives.
b. Respondent OSG:
i. the sugar planters have failed to show that they belong to a different class
ii. petition for prohibition would be premature.
iii. There is no rule that only money already in existence can be the subject of an appropriation law
iv. The word "initial" simply means that additional amounts may be appropriated later when necessary
C. Inclusion of his small landholding under Operation Land Transfer (G.R. No. 79744)
a. Petitioner:
i. violation of due process and the requirement for just compensation; since Secretary of DAR
refused payment of lease rentals to him after delivery of the Certificates. They therefore ask
the Court for WRIT OF MANDAMUS to compel the respondent to issue the said rules.
ii. Asked for cancellation of CLT but his petition was denied without hearing; MR was not acted
upon.
iii. The petitioner is denied the right of maximum retention provided for under the 1987 Constitution.
iv. Violated Separation of powers; president no authority to legislate
v. Lease rentals paid shall be considered as advance payment for the land is an unconstitutional
taking of a vested property right
b. Respondent OSG:
i. the motion for reconsideration filed with the Minister of Agrarian Reform is still unresolved.

D. Owners of rice and corn lands (G.R. No. 78742)

Their respective lands do not exceed the statutory limit but are occupied by tenants who are actually cultivating
such lands

a. Petitioner:
i. they cannot eject their tenants and so are unable to enjoy their right of retention because the DAR
has so far not issued the IRRs.
ii. Measures are not applicable to them because they do not own more than seven hectares of
agricultural land.
iii. Assuming arguendo that the rules were intended to cover them also, the said measures are
nevertheless not in force because they have not been published as required by law and the
ruling of this Court in Tañada v. Tuvera.
iv. letter of instruction could not have repealed the presidential decree.
b. Respondent OSG:
i. P.D. No. 27 has been amended by LOI 474 removing any right of retention from persons who own
other agricultural lands of more than 7 hectares
ii. Petitioners failed to file the corresponding applications for retention under these measures, hence
petitioners are now barred from invoking this right.
iii. Petition is prematurely; their case pending with President of the Philippines.

ISSUE/S:

1. W/N President Aquino has the power to legislate thus not in violation of separation of powers;
2. W/N Agrarian Reform Fund is unconstitutional on the ground that it does not conform to the requirements of
a valid appropriation as specified in the Constitution;
3. W/N Proc. No. 131 and E.O. No. 229 should be invalidated because they do not provide for retention limits
as required by Article XIII, Section 4;
4. W/N E.O. No. 229 violates the constitutional requirement that a bill shall have only one subject;
5. W/N LOI 474 amended G.R. No. 79744;
6. W/N the Court may issue a writ of Mandamus *********
7. W/N the State Exercise Power of eminent domain in order to carry out these laws or police power?
8. W/N the retention limit prescribed by the congress valid
9. W/N due process is violated in relation to issue number 8
10. W/N equal protection clause was violated

RULING:

1. YES. the power of President Aquino to promulgate Proc. No. 131 and E.O. Nos. 228 and 229, the same was
authorized under Section 6 of the Transitory Provisions of the 1987 Constitution. The said measures were
issued by President Aquino BEFORE July 27, 1987, when the Congress of the Philippines was formally
convened and took over legislative power from her.
2. YES. The creation of the fund is only incidental to the main objective of the proclamation, which is
agrarian reform. Proc. No. 131 is not an appropriation measure even if it does provide for the creation of said
fund, for that is not its principal purpose. Section 24 and Section 25(4) of Article VI are not applicable. With
particular reference to Section 24, this obviously could not have been complied with for the simple reason
 that the House of Representatives, which now has the exclusive power to initiate appropriation
measures, had not yet been convened when the proclamation was issued. The legislative power was
then solely vested in the President of the Philippines, who embodied, as it were, both houses of Congress.
3. NO. R.A. No. 6657 does provide for such limits now in Section 6 of the law, which in fact is one of its most
controversial provisions. In no case shall retention by the landowner exceed five (5) hectares. Three (3)
hectares may be awarded to each child of the landowner, Provided, That landowners whose lands have been
covered by Presidential Decree No. 27 shall be allowed to keep the area originally retained by them.
4. NO. It is settled that the title of the bill does not have to be a catalogue of its contents and will suffice if the
matters embodied in the text are relevant to each other and may be inferred from the title.
5. NO. While it is true that he important thing is that it was issued by President Marcos’ whose word was law
during that time, (Dictador kasi tong hayop na to.). LOI was published in OG.
6. wait
7. This is definitely an exercise not of the police power but of the power of eminent domain. There is an
exercise of the police power for the regulation of private property in accordance with the Constitution. But
where, to carry out such regulation, it becomes necessary to deprive such owners of whatever lands they
may own in excess of the maximum area allowed, there is definitely a taking under the power of eminent
domain for which payment of just compensation is imperative. The taking contemplated is not a mere limitation
of the use of the land. What is required is the surrender of the title to and the physical possession of the said
excess and all beneficial rights accruing to the owner in favor of the farmer-beneficiary.
8. Retention limits were not questioned in these petitions, therefore court did not discuss them.
9. NO. The argument of the small farmers that they have been denied equal protection because of the absence
of retention limits has also become academic under Section 6 of R.A. No. 6657. Significantly, they too
have not questioned the area of such limits.
10. NO. There is also the complaint that they should not be made to share the burden of agrarian reform, an
objection also made by the sugar planters on the ground that they belong to a particular class with particular
interests of their own. However, no evidence has been submitted to the Court that the requisites of a valid
classification have been violated. The petitioners have not shown that they belong to a different class and
entitled to a different treatment. The Congress is allowed a wide leeway in providing for a valid classification.
Its decision is accorded recognition and respect by the courts of justice except only where its discretion is
abused to the detriment of the Bill of Rights.

2. Luz Farms v. Sec. of DAR

DOCTRINE/S:

FACTS:
In 1988, Pres. Aquino approved R.A. No. 6657 or the Comprehensive Agrarian Reform Law, which includes
the raising of livestock, poultry and swine in its coverage. On January 1989, the Sec. of DAR promulgated the (1)
Guidelines and Procedures Implementing Production and Profit Sharing as embodied in Sections 13 and 32 and its
(2)Rules and Regulations implementing Section 11 of R.A. No. 6657
Luz Farms, a corp. engaged in the livestock and poultry business and together with others in the same
business, stands to be adversely affected by the enforcement of Section 3(b), Section 11, Section 13, Section 16(d)
and 17 and Section 32 of R.A. No. 6657. Hence, this petition praying for the guidelines and rules be declared
unconstitutional. Meanwhile, it is also prayed that a writ of preliminary injunction or restraining order be issued
enjoining public respondents from enforcing the same, insofar as they are made to apply to Luz Farms and other
livestock and poultry raisers.
The Court resolved to deny the prayer for the issuance of a preliminary injunction but granted the Motion
for Reconsideration regarding the injunctive relief.

Luz Farms questions the following provisions of R.A. 6657, insofar as they are made to apply to it

1. Section 3(b) which includes the "raising of livestock (and poultry)" in the definition of "Agricultural, Agricultural
Enterprise or Agricultural Activity."

2. Section 11 which defines "commercial farms" as "private agricultural lands devoted to commercial, livestock,
poultry and swine raising . . ."

3. Section 13 which calls upon petitioner to execute a production-sharing plan.

4. Section 16(d) and 17 which vest on the Department of Agrarian Reform the authority to summarily determine
the just compensation to be paid for lands covered by the Comprehensive Agrarian Reform Law.

5. Section 32 which spells out the production-sharing plan mentioned in Section 13 —

". . . (W)hereby three percent (3%) of the gross sales from the production of such lands are distributed within
sixty (60) days of the end of the fiscal year as compensation to regular and other farmworkers in such lands over
and above the compensation they currently receive: Provided, That these individuals or entities realize gross sales
in excess of five million pesos per annum unless the DAR, upon proper application, determine a lower ceiling.

In the event that the individual or entity realizes a profit, an additional ten (10%) of the net profit after tax shall be
distributed to said regular and other farmworkers within ninety (90) days of the end of the fiscal year . . ."

Luz Farms contended that it does not seek the nullification of R.A. 6657 in its entirety. However it argued
that Congress in enacting the said law has transcended the mandate of the Constitution, in including land devoted
to the raising of livestock, poultry and swine in its coverage. Livestock or poultry raising is not similar to crop or tree
farming. Land is not the primary resource in this undertaking and represents no more than five percent (5%) of the
total investment of commercial livestock and poultry raisers. Lands support the buildings and other amenities
attendant to the raising of animals and birds. The use of land is incidental to but not the principal factor or
consideration in productivity in this industry. Including backyard raisers, about 80% of those in commercial
livestock and poultry production occupy five hectares or less. The remaining 20% are mostly corporate
farms.

Public respondent argued that livestock and poultry raising is embraced in the term "agriculture" and the
inclusion of such enterprise under Section 3(b) of R.A. 6657 is proper. He cited that Webster's International
Dictionary, Second Edition (1954), defines the following words:

"Agriculture — the art or science of cultivating the ground and raising and harvesting crops, often, including
also, feeding, breeding and management of livestock, tillage, husbandry, farming. It includes farming, horticulture,
forestry, dairying, sugarmaking . . .

Livestock — domestic animals used or raised on a farm, especially for profit.

Farm — a plot or tract of land devoted to the raising of domestic or other animals."

ISSUE/S: Whether or not certain provisions of RA 6657 is unconstitutional for including in its definition of
“Agriculture” the livestock and poultry industry?

RULING:

YES. The transcripts of the deliberations of the Constitutional Commission of 1986 on the meaning of the word
"agricultural," clearly show that it was never the intention of the framers of the Constitution to include livestock
and poultry industry in the coverage of the constitutionally-mandated agrarian reform program of the
Government. The Committee adopted the definition of "agricultural land" as defined under Section 166 of R.A.
3844, as laud devoted to any growth, including but not limited to crop lands, saltbeds, fishponds, idle and abandoned
land.

The intention of the Committee is to limit the application of the word "agriculture." Commissioner Jamir proposed to
insert the word "ARABLE" to distinguish this kind of agricultural land from such lands as commercial and industrial
lands and residential properties because all of them fall under the general classification of the word "agricultural".
However the proposal was not considered because the Committee contemplated that agricultural lands are limited
to arable and suitable agricultural lands and therefore, do not include commercial, industrial and residential lands.

Further, Commissioner Tadeo pointed out that the reason why they used the term “farmworkers” rather than
“agricultural workers” in the said law is because “agricultural workers” includes the livestock and poultry industry,
hence, since they do not intend to include the latter, they used “farmworkers” to have distinction.

Hence, there is merit on the petitioner’s argument that the product-sharing plan applied to “corporate farms” in the
contested provisions is unreasonable for being consficatory and violative of the due process of law.

Concurring Opinion: Sarmiento, J.

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

xxx xxx xxx

No land is tilled and no crop is harvested in livestock and poultry farming. There are no tenants nor landlords, only
employers and employees.

Livestock and poultry do not sprout from land nor are they "fruits of the land."

Land is not even a primary resource in this industry. The land input is inconsequential that all the commercial hog
and poultry farms combined occupy less than one percent (1%) (0.4% for piggery, 0.2% for poultry) of the 5.45
million hectares of land supposedly covered by the CARP. And most farms utilize only 2 to 5 hectares of land.

In every respect livestock and poultry production is an industrial activity. Its use of an inconsequential portion of
land is a mere incident of its operation, as in any other undertaking, business or otherwise.

How then can livestock and poultry farmlands be arable when such are almost totally occupied by these structures?

The fallacy of equating the status of livestock and poultry farmworkers with that of agricultural tenants surfaces
when one considers contribution to output. Labor cost of livestock and poultry farms is no more than 4% of total
operating cost. The 98% balance represents inputs not obtained from the land nor provided by the farmworkers —
inputs such as feeds and biochemicals (80% of the total cost), power cost, cost of money and several others.

Moreover, livestock and poultry farmworkers are covered by minimum wage law rather than by tenancy law. They
are entitled to social security benefits where tenant-farmers are not. They are paid fixed wages rather than crop
shares. And as in any other industry, they receive additional benefits such as allowances, bonuses, and other
incentives such as free housing privileges, light and water.

3. Alita v. CA
DOCTRINE/S:

FACTS:
Two (2) parcels of land was acquired by PR’s predecessors-in-interest through homestead patent under the
provisions of C.A. No. 141. PR wanted to personally cultivate the lands, but petitioners refuse to vacate, relying on
the provisions of P.D. 27 and P.D. 316 and appurtenant regulations issued by the then Ministry of Agrarian Reform
(DAR for short), now Department of Agrarian Reform (MAR for short). PR instituted a complaint against Hon.
Conrado Estrella as then Minister of Agrarian Reform and against petitioners to declare P.D. 27 and all other
Decrees, Letters of Instructions and General Orders inapplicable to homestead lands. PR filed an urgent motion to
enjoin petitioners from declaring the lands in litigation under Operation Land Transfer and from being issued land
transfer certificates, which the Court of Agrarian Relations (now RTC) denied. CA affirmed.

ISSUE/S: W/N lands obtained through homestead patent are covered by the Agrarian Reform under P.D. 27?

RULING:
NO. It is agreeable 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 very
purpose of the enactment of the Public Land Act or C.A. No. 141.

The Homestead Act has been enacted for the welfare and protection of the poor. The law gives a needy citizen a
piece of land where he may build a modest house for himself and family and plant what is necessary for subsistence
and for the satisfaction of life's other needs. The right of the citizens to their homes and to the things necessary for
their subsistence is as vital as the right to life itself. They have a right to live with a certain degree of comfort as
become human beings, and the State which looks after the welfare of the people's happiness is under a duty to
safeguard the satisfaction of this vital right.
 In this regard, the Philippine Constitution likewise respects the superiority of the homesteaders' rights over the rights
of the tenants guaranteed by the Agrarian Reform statute. In point is Section 6 of Article XIII of the 1987 Philippine
Constitution which provides:
Section 6. The State shall apply the principles of agrarian reform or stewardship, whenever applicable in
accordance with law, in the disposition or utilization of other natural resources, including lands of 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.

Additionally, it is worthy of note that the newly promulgated Comprehensive Agrarian Reform Law of 1988 or
Republic Act No. 6657 likewise contains a proviso supporting the inapplicability of P.D. 27 to lands covered by
homestead patents like those of the property in question, reading.

4. Paris v. Alfeche
DOCTRINE/S:

FACTS:
Petitioner is the owner of 2 parcels of land with an area of 10.6 hectares and 13.2 hectares. Both are fully tenanted
by respondents who are recipients of Emancipation Patents in their name pursuant to Operation Land Transfer
under PD 27, notwithstanding that no amount was paid by the tenants and Land Bank of the Philippines. Petitioner
and tenants have not signed any Land transfer agreement. Petitioner and her children have been deprived of their
property without due process of law and without just compensation since the tenants thereafter stopped paying
rentals.

Petitioner contends the ff:

1. She is entitled to 7 hectares under PD27 and or 5 hectares and 3 hectares each for her children under
CARL.
2. The Emancipation Patents issued are null and void for being contrary to law
3. She owns the property as original Homestead grantee, and thus exempt from the operation of Land Reform
Act, and being so, she has a superior right over that of tenants-farmers to cultivate their homestead
personally.
Hence, she moved for the cancellation of the Emancipation Patents and the payment for back rentals.

Respondents answer:

1. Petitioner’s right to retain the 7 hectares is not absolute since she owns other agricultural landholdings,
disqualifying him her to retain the area, and that she has other properties sufficient to support her family.
2. Criteria set forth in PD27 is observed in the granting of Emancipation Patents, the tenant farmers deemed
full owners of the land they till and the lease rentals paid should be considered as amortization payments.
Adjudicator: Granted; DARAB: reversed Adjudicator decision; and the CA: Affirmed DARAB

ISSUE/S: WON the original homestead issued under the Public Land Act are exempted from the operation of land
reform?

RULING:
NO. PD 27, (under which the Emancipation Patents sought to be cancelled were issued to respondents) applies to
all tenanted private agricultural lands primarily devoted to rice and corn under a system of share-crop or lease
tenancy, whether classified as landed estate or not. The law makes no exception whatsoever in its coverage.
Nowhere therein does it appear that lots obtained by homestead patents are exempt from its operation.

Homestead grantees or their heirs can own and retain the original homestead, only for as long as they
continue cultivate them. It is by the fact of continued cultivation by the original grantees or heirs that shall exempt
their lands from land reform coverage, which is not present in this case.

Re: Right to retain 7 hectares under PD 27. On the other hand, the right to retain an area of 7 hectares is not
absolute. It is premised on the condition that the landowner is cultivating the area sought to be retained or will
actually cultivate it upon effectivity of the law. In this case, neither of the conditions are present, the land being fully
tenanted and not her being personally cultivating any part thereof.
 Re: Right to retain 5 hectares under CARL. However, petitioner can retain the 5 hectares in accordance with Sec 6
of RA 6657, which requires no qualifying condition for the landowner to be entitled to retain such area. But
petitioner’s heirs are not entitled to award 3 hectares each, since they are not actually tilling or managing the land.

Re: Just compensation. Under the law, although tenant farmers are already deemed owners of the land they till,
they are still required to pay the cost of the land, including interest, within 15 years before the title is transferred to
them. In this case, there is not showing that the respondents complied with the requirement of full payment of the
cost of the parcels of land. Admittedly, the value had not been even determined yet. In the absence of such, the
Court cannot rule that just compensation has already been fully paid. However, in determining the amount to be
paid to the petitioner, all lease rentals paid by respondents to her should be deducted therefrom.

5. Stanfilco Employees Agrarian Reform Beneficiaries Multi-Purpose Cooperative v. DOLE Philippines

DOCTRINE/S:

FACTS:

STANFILCO, as seller, and DOLE, as buyer, entered into a Banana Production and Purchase Agreement4 (BPPA),
which provided that STANFILCO shall sell exclusively to DOLE, and the latter shall buy from the former, all
Cavendish bananas of required specifications to be planted on the land owned by the STANFILCO . STANFILCO
bound and obliged itself, under Article V of BPPA to: “Sell exclusively to the BUYER … In the case of any such
rejected bananas, the SELLER shall have the right to sell such rejected bananas to third parties, for domestic non-
export consumption. The SELLER shall only sell bananas produced from the plantation and not from any other
source.” Any dispute arising from or in connection with the BPPA between the parties shall be finally settled through
arbitration, in accordance to Article IX of the BPPA.

DOLE filed a complaint with RTC against STANFILCO, the spouses Abujos, and Oribanex Services, Inc. (Oribanex)
for specific performance and damages, with a prayer for the issuance of a writ of preliminary injunction and of a
temporary restraining order. DOLE alleged that STANFILCO sold and delivered to Oribanex, through the spouses
Abujos, the bananas rejected by respondent, in violation of paragraph 5(p), Article V of the BPPA which limited the
sale of rejected bananas for "domestic non-export consumption." Respondent further alleged that Oribanex is
likewise an exporter of bananas and is its direct competitor.

DOLE narrated the following two instances where plaintiff violated Article V of the BPPA: 1) Respondent, through
its authorized security personnel, discovered that plaintiff, packed the bananas rejected by it in 373 boxes marked
"CONSUL" in a packing plant and sold and delivered them to defendant Abujos, who carried and loaded the same
on board a blue Isuzu Canter and delivered to defendant ORIBANEX for export, covered by Abujos Delivery
Receipt; and 2) That the following day, again the same security found that plaintiff continued to pack the bananas
rejected by plaintiff in 648 boxes marked as "CONSUL" and sold and delivered them to defendant ORIBANEX
SERVICES, INC., for export, through defendants Abujos using a red Isuzu Forwarder.

STANFILCO filed a motion to dismiss on the following grounds: 1) lack of jurisdiction over the subject matter of the
claim since Department of Agrarian Reform Adjudication Board (DARAB) has the exclusive jurisdiction over actions
filed against respondent; 2) lack of cause of action because it is premature and has not been referred to arbitration;
3) failure to submit to arbitration which is a condition precedent to the filing of a complaint in accordance to Art. IX
of the BPPA, and the complaint’s defective verification and certification of non-forum shopping because the Board
of Directors of Respondent did not authorize its execution.

DOLE opposed STANFILCO’s motion to dismiss alleging, among others, that: 1) the dispute between the parties is
not an agrarian dispute within the exclusive jurisdiction of the DARAB under RA 6657; and 2) the Arbitration Clause
of the BPPA is not applicable as, aside from plaintiff, respondent impleaded other parties as defendants.

RTC denied STANFILCO’s motion to dismiss because the case does not involve an agrarian conflict and is a judicial
matter that it can resolve and likewise denied the motion for reconsideration.

STANFILCO filed a special civil action for certiorari with the CA alleging grave abuse of discretion on the part of
the RTC for denying its motion to dismiss and the subsequent motion for reconsideration. Plaintiff argued that the
BPPA executed is an agri-business venture agreement contemplated by DAR’s AO No. 9-98. Thus, any dispute
arising from the interpretation and implementation of the BPPA is an agrarian dispute within the exclusive jurisdiction
of the DARAB. CA found that the RTC did not gravely abuse and held that the case is not an agrarian dispute within
the purview of Section 3(d) of RA No. 6657, but is an action to compel SEARBEMCO to comply with its obligations
under the BPPA; it called for the application of the provisions of the Civil Code, not RA No. 6657. CA likewise denied
the plaintiff’s motion for reconsideration. Hence, this petition.

ISSUE/S:

1) WON the controversy is an agrarian dispute contemplated in Section 50 of RA 6657

2) WON plaintiff violated Art. V. of the BPPA when it sold the bananas to Oribanex Services
3) WON arbitration proceedings should have done before the filing of the complaint

RULING:
1. NO! The parties in the present case have no tenurial, leasehold, or any other agrarian relationship that could
bring their controversy within the ambit of agrarian reform laws and within the jurisdiction of the DARAB. In fact,
SEARBEMCO has no allegation whatsoever in its motion to dismiss regarding any tenancy relationship between it
and DOLE that gave the present dispute the character of an agrarian dispute.
Section 3(d) of RA No. 6657 is clear in defining an agrarian dispute: "any controversy relating to tenurial
arrangements, whether leasehold, tenancy, stewardship or otherwise, over lands devoted to agriculture, including
dispute concerning farm-workers’ associations or representations of persons in negotiating, fixing, maintaining,
changing or seeking to arrange terms or conditions of such tenurial arrangements. It includes any controversy
relating to compensation of lands acquired under this Act and other terms and conditions of transfer of ownership
from landowners to farmworkers, tenants and other agrarian reform beneficiaries, whether the disputants stand in
the proximate relation of farm operator and beneficiary, landowner and tenant, or lessor and lessee." A notable
feature of RA No. 6657 and its implementing rules is the focus on agricultural lands and the relationship over this
land that serves as the basis in the determination of whether a matter falls under DARAB jurisdiction.
In Heirs of the Late Hernan Rey Santos v. Court of Appeals,27 we held that: “For DARAB to have jurisdiction
over a case, there must exist a tenancy relationship between the parties. x x x.” In Vda. De Tangub v. Court of
Appeals (191 SCRA 885), we held that the jurisdiction of the Department of Agrarian Reform is limited to the
following: a.) adjudication of all matters involving implementation of agrarian reform; b.) resolution of agrarian
conflicts and land tenure related problems; and c.) approval and disapproval of the conversion, restructuring or
readjustment of agricultural lands into residential, commercial, industrial, and other non-agricultural uses.
[Emphasis supplied].
The case of Pasong Bayabas Farmers Association, Inc. v. Court of Appeals28 lists down the indispensable
elements for a tenancy relationship to exist: "(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 the landowner and
the tenant or the agricultural lessee."
We have always held that tenancy relations cannot be presumed. The elements of tenancy must first be
proved by substantial evidence which can be shown through records, documents, and written agreements between
the parties. A principal factor, too, to consider in determining whether a tenancy relationship exists is the intent of
the parties.29
SEARBEMCO has not shown that the above-mentioned indispensable elements of tenancy relations are
present between it and DOLE. It also cannot be gleaned from the intention of the parties that they intended to form
a tenancy relationship between them. In the absence of any such intent and resulting relationship, the DARAB
cannot have jurisdiction. Instead, the present petition is properly cognizable by the regular courts, as the CA and
the RTC correctly ruled.
Notably, the requirement of the existence of tenurial relationship has been relaxed in the multiple cases.
The Court, speaking through former Chief Justice Panganiban, declared in Islanders that: [The definition of ‘agrarian
dispute’ in RA No. 6657 is] broad enough to include disputes arising from any tenurial arrangement beyond the
traditional landowner-tenant or lessor-lessee relationship. xxx [A]grarian reform extends beyond the mere
acquisition and redistribution of land, the law acknowledges other modes of tenurial arrangements to effect the
implementation of CARP.32
Moreover, the resolution of the issue raised in Islanders and Cubero required the interpretation and
application of the provisions of RA No. 6657, considering that the farmer-beneficiaries claimed that the agreements
contravened specific provisions of that law. In the present case, DOLE’s complaint for specific performance and
damages before the RTC did not question the validity of the BPPA that would require the application of the
provisions of RA No. 6657; neither did SEARBEMCO’s motion to dismiss nor its other pleadings assail the validity
of the BPPA on the ground that its provisions violate RA No. 6657. The resolution of the present case would
 therefore involve, more than anything else, the application of civil law provisions on breaches of contract, rather
than agrarian reform principles. Indeed, in support of their arguments, the parties have capitalized and focused on
their relationship as buyer and seller. DOLE, the buyer, filed a complaint against SEARBEMCO, the seller, to
enforce the BPPA between them and to compel the latter to comply with its obligations. The CA is thus legally
correct in its declaration that "the action before the RTC does not involve an agrarian dispute, nor does it call for
the application of Agrarian Reform laws. x x x. The action of [DOLE] involves and calls for the application of the
New Civil Code, in tandem with the terms and conditions of the [BPPA] of [SEARBEMCO] and [DOLE]."33
DARAB’s jurisdiction under Section 50 of RA No. 6657 should be read in conjunction with the coverage of
agrarian reform laws; administrative issuances like DAR AO Nos. 9-98 and 2-99 cannot validly extend the scope of
the jurisdiction set by law. In so ruling, however, we do not pass upon the validity of these administrative issuances.
We do recognize the possibility that disputes may exist between parties to joint economic enterprises that directly
pertain to the management, cultivation, and use of CARP-covered agricultural land. Based on our above discussion,
these disputes will fall within DARAB’s jurisdiction.
Even assuming that the present case can be classified as an agrarian dispute involving the interpretation
or implementation of agribusiness venture agreements, DARAB still cannot validly acquire jurisdiction, at least
insofar as DOLE’s cause of action against the third parties – the spouses Abujos and Oribanex – is concerned. To
prevent multiple actions, we hold that the present case is best resolved by the trial court.

2. YES! We find the allegations in DOLE’s complaint to be sufficient basis for the judgment prayed for. Hypothetically
admitting the allegations in DOLE’s complaint that SEARBEMCO sold the rejected bananas to Oribanex, a
competitor of DOLE and also an exporter of bananas, through the spouses Abujos, a valid judgment may be
rendered by the RTC holding SEARBEMCO liable for breach of contract. That the sale had been to the spouses
Abujos who are not exporters is essentially a denial of DOLE’s allegations and is not therefore a material
consideration in weighing the merits of the alleged "lack of cause of action." What SEARBEMCO stated is a counter-
statement of fact and conclusion, and is a defense that it will have to prove at the trial. At this point, the material
consideration is merely what the complaint expressly alleged. Hypothetically assuming DOLE’s allegations of
ultimate sale to Oribanex, through the spouses Abujos, to be true, we hold – following the test of sufficiency in
Jordana – that DOLE’s prayer for specific performance and damages may be validly granted; hence, a cause of
action exists.

3. NO! Following our conclusion that agrarian laws find no application in the present case, we find – as the CA did
– that SEARBEMCO’s arguments anchored on these laws are completely baseless. Furthermore, the cited DAR
AO No. 2-99, on its face, only mentions a "preference," not a strict requirement of referral to arbitration. The BPPA-
based argument deserves more and closer consideration.
We agree with the CA ruling that the BPPA arbitration clause does not apply to the present case since third parties
are involved. Any judgment or ruling to be rendered by the panel of arbitrators will be useless if third parties are
included in the case, since the arbitral ruling will not bind them; they are not parties to the arbitration agreement. In
the present case, DOLE included as parties the spouses Abujos and Oribanex since they are necessary parties,
i.e., they were directly involved in the BPPA violation DOLE alleged, and their participation are indispensable for a
complete resolution of the dispute. To require the spouses Abujos and Oribanex to submit themselves to arbitration
and to abide by whatever judgment or ruling the panel of arbitrators shall make is legally untenable; no law and no
agreement made with their participation can compel them to submit to arbitration.
Additionally, the inclusion of third parties in the complaint supports our declaration that the present case
does not fall under DARAB’s jurisdiction. DARAB’s quasi-judicial powers under Section 50 of RA No. 6657 may be
invoked only when there is prior certification from the Barangay Agrarian Reform Committee (or BARC) that the
dispute has been submitted to it for mediation and conciliation, without any success of settlement.43 Since the
present dispute need not be referred to arbitration (including mediation or conciliation) because of the inclusion of
third parties, neither SEARBEMCO nor DOLE will be able to present the requisite BARC certification that is
necessary to invoke DARAB’s jurisdiction; hence, there will be no compliance with Section 53 of RA No. 6657.

6. People v. Vanzuela
DOCTRINE/S:

FACTS:

Veneranda is the wife of the late Dionisio Paler, Sr., one (1) hectare of the riceland (subject property) owned by
them was cultivated by the respondents as agricultural tenants for more than ten (10) years. The respondents
allegedly failed to pay the rentals from 1997 to 2001 and having harvested and accounted for a total of 400 sacks
of palay for the past 10 harvest seasons of which 25% thereof were hold (sic) in trust by them or a total value of
₱80,000.00. Initially, Veneranda brought the matter before the Department of Agrarian Reform (DAR) Office in
Mainit, Surigao del Norte, but no amicable settlement was reached by the parties. Thus, Veneranda filed a criminal
complaint for estafa against the respondents which was for lack of jurisdiction, according to the RTC, it is within
the exclusive original jurisdiction of the Department of Agrarian Reform Adjudication Board (DARAB)
pursuant to Section 1, Rule II of the DARAB New Rules of Procedure, x x x.

Petitioner contends that, under Sec. 57 of RA 6657, otherwise known as the "Comprehensive Agrarian Reform
Law" (CARL), Special Agrarian Courts (SACs) were vested with limited criminal jurisdiction, that the only penal
provision in RA 6657 is Section 73 thereof in relation to Section 74, which does not cover estafa; that no
agrarian reform law confers criminal jurisdiction upon the DARAB, as only civil and administrative aspects
in the implementation of the agrarian reform law have been vested in the DAR; that necessarily, a criminal
case for estafa instituted against an agricultural tenant is within the jurisdiction and competence of regular
courts of justice as the same is provided for by law; Petitioner submits that there is no substantial distinction
between an agricultural tenant who incurs criminal liability for estafa for misappropriating the lease rentals due his
landowner, and a non-agricultural tenant who likewise incurs criminal liability for misappropriation.

Respondents contend that the agricultural tenant's failure to pay his lease rentals does not give rise to criminal
liability for estafa. Respondents stand by the ruling of the RTC that pursuant to Section 1, Rule II of the DARAB
New Rules of Procedure, the DARAB has jurisdiction over agrarian disputes; and that respondents did not commit
estafa for their alleged failure to pay their lease rentals. Respondents submit that a simple case for ejectment and
collection of unpaid lease rentals, instead of a criminal case, should have been filed with the DARAB. Respondents
also submit that, assuming arguendo that they failed to pay their lease rentals, they cannot be held liable for Estafa,
as defined under Article 315, paragraph 4, No. 1(b) of the Revised Penal Code, because the liability of an agricultural
tenant is a mere monetary civil obligation; and that an agricultural tenant who fails to pay the landowner becomes
merely a debtor, and, thus, cannot be held criminally liable for estafa.

ISSUE/S:

1. W/N the RTC has jurisdiction over the crime of estafa involving agricultural tenants? – YES
2. W/N an agricultural tenant who fails to pay the rentals on the land tilled, can be successfully prosecuted for
estafa? – YES

RULING:
1. YES. Based on the law and material allegations of the information filed, the RTC erroneously concluded that it
lacks jurisdiction over the subject matter on the premise that the case before it is purely an agrarian dispute. The
cases relied upon by the RTC, namely, David v. Rivera and Philippine Veterans Bank v. Court of Appeals, are of
different factual settings. They hinged on the subject matter of Ejectment and Annulment of Certificate of Land
Ownership Awards (CLOAs), respectively. It is true that in Machete v. Court of Appeals this Court held that RTCs
have no jurisdiction over cases for collection of back rentals filed against agricultural tenants by their landowners.
In that case, however, what the landowner filed before the RTC was a collection suit against his alleged tenants.
These three cases show that trial courts were declared to have no jurisdiction over civil cases which were initially
filed with them but were later on characterized as agrarian disputes and thus, within DARAB's jurisdiction. No such
declaration has been made by this Court with respect to criminal cases.

In the instant case, the RTC failed to consider that what is lodged before it is a criminal case for estafa involving an
alleged misappropriated amount of ₱80,000.00 -- a subject matter over which the RTC clearly has jurisdiction.
Notably, while the RTC has criminal jurisdiction conferred on it by law, the DARAB, on the other hand, has no
authority to try criminal cases at all.
Clearly, the law and the DARAB Rules are deafeningly silent on the conferment of any criminal jurisdiction in favor
of the DARAB. It is worth stressing that even the jurisdiction over the prosecution of criminal offenses in violation of
RA 6657 per se is lodged with the SACs and not with the DARAB. While indeed, the parties admit that there is an
agricultural tenancy relationship in this case, and that under the circumstances, Veneranda as landowner could
have simply filed a case before the DARAB for collection of lease rentals and/or dispossession of respondents as
tenants due to their failure to pay said lease rentals, there is no law which prohibits landowners from instituting a
criminal case for estafa, as defined and penalized under Article 315 of the Revised Penal Code, against their
tenants. Succinctly put, though the matter before us apparently presents an agrarian dispute, the RTC cannot shirk
from its duty to adjudicate on the merits a criminal case initially filed before it, based on the law and evidence
presented, in order to determine whether an accused is guilty beyond reasonable doubt of the crime charged.
 2. YES. However, we must reiterate our ruling in Re: Conviction of Judge Adoracion G. Angeles, that while we do
not begrudge a party's prerogative to initiate a case against those who, in his opinion, may have wronged him, we
now remind landowners that such prerogative of instituting a criminal case against their tenants, on matters related
to an agrarian dispute, must be exercised with prudence, when there are clearly lawful grounds, and only in the
pursuit of truth and justice.
Thus, even as we uphold the jurisdiction of the RTC over the subject matter of the instant criminal case, we still
deny the petition. Herein respondents were charged with the crime of estafa as defined under Article 315, paragraph
4, No. 1(b) of the Revised Penal Code.
In fine, we hold that the trial court erred when it dismissed the criminal case for lack of jurisdiction over the subject
matter. However, we find no necessity to remand the case to the trial court for further proceedings, as it would only
further delay the resolution of this case. We have opted to rule on the merits of the parties’ contentions, and hereby
declare that respondents cannot be held liable for estafa for their failure to pay the rental on the agricultural land
subject of the leasehold.

7. Mendoza v. Germino
DOCTRINE/S:

FACTS:

Aurora C. Mendoza filed a complaint with the MTC of Sta. Rosa, Nueva Ecija against respondent Narciso Germino
for forcible entry, claiming that they were the registered owners of a five-hectare parcel of land in Soledad, Sta.
Rosa, Nueva Ecija (subject property) under Transfer Certificate of Title No. 34267. That sometime in 1988, Narciso
unlawfully entered the subject Property and despite the plaintiffs’ repeated demands, Narciso refused to vacate the
subject property. Narciso claims that among others,that his brother, respondent Benigno Germino, was the plaintiffs’
agricultural lessee and he merely helped the latter in the cultivation as a member of the immediate farm household.
After several postponements without proceeding, the plaintiffs filed a motion to remand the case to the Department
of Agrarian Reform Adjudication Board (DARAB), in view of the tenancy issue raised by respondent Narciso and
later on remanded the case to the DARAB, Cabanatuan City for further proceedings despite the objection of Narciso.

On December 14, 1995, the plaintiffs filed an amended complaint with the Provincial Agrarian Reform Adjudicator
(PARAD), impleading respondent Benigno as additional defendant and alleged that Efren Bernardo was the
agricultural lessee of the subject property and Benigno unlawfully entered the subject property in 1982 or 1983,
withheld possession of the subject property up to 1987, and appropriated for himself its produce, despite repeated
demands from the plaintiffs for the return of the property. Benigno had transferred possession of the subject property
to respondent Narciso, who refused to return the possession of the subject property and appropriated the land’s
produce for himself. The subject property was fully irrigated and could produce 100 cavans of palay per hectare for
each cropping season and the plaintiffs alleged that the respondents were able to harvest a total of 13,000 cavans
of palay from the time they unlawfully withheld possession of the subject property in 1982 Thus, they prayed that
the respondents be ordered to jointly and severally pay 13,000 cavans of palay, or its monetary equivalent, as actual
damages, to return possession of the subject property, and to pay P15,000.00 as attorney’s fees.

Respondents, filed their answer denying the allegations in the complaint, that plaintiffs had no right over the subject
property as they agreed to sell it to respondent Benigno for P87,000.00 and they already made a partial payment
of Php 50,000.00 but the plaintiffs refused to receive the balance and execute the deed of conveyance, despite
repeated demands. They also asserted that jurisdiction over the complaint lies with the RTC since ownership and
possession are the issues and not the tenancy.

PARAD ruled that the respondents were mere usurpers of the subject property, noting that they failed to prove that
respondent Benigno was the plaintiffs’ bona fide agricultural lessee and they subsequently ordered the respondents
to leave the said propery.

Upon appeal with DARAB, respondents argued that the case should have been dismissed because the MTC’s
referral to the DARAB was void with the enactment of Republic Act (R.A.) No. 6657,14 which repealed the rule on
referral under Presidential Decree (P.D.) No. 316. However DARAB likewise affirmed the PARAD decision.

When the case was brought to the CA, they held that MTC erred in transferring the case to the DARAB since the
material allegations of the complaint show a case for forcible entry, not an agrarian dispute. It noted that the
subsequent filing of the amended complaint did not confer jurisdiction upon the DARAB, thus setting aside it’s
decision and remanded the case to MTC. Hence petitioner filed the present petition.
 ISSUE/S: whether the MTC or the DARAB has jurisdiction over the case.

RULING:

With the MTC. Jurisdiction is determined by the allegations in the

Complaint. It is a basic rule that jurisdiction over the subject matter is determined by the allegations in the complaint
was determined exclusively by the Constitution and the law. It is neither for the court nor the parties to violate or
disregard the rule, this matter being legislative in character.

BP 129,24 as amended by R.A. No. 7691, provides that the MTC shall have exclusive original jurisdiction over
cases of forcible entry and unlawful detainer, while Section 5028 of R.A. No. 6657, as well as Section 3429 of EO.
129-A,30 the DARAB has primary and exclusive jurisdiction, both original and appellate, to determine and
adjudicate all agrarian disputes involving the implementation of the CARP, and other agrarian laws and their
implementing rules and regulations. agrarian dispute refers to any controversy relating to, among others, tenancy
over lands devoted to agriculture.

For a case to involve an agrarian dispute, the following essential requisites of an agricultural tenancy relationship
must be present:

(1) the parties are the landowner and the tenant;

(2) the subject is agricultural land;
(3) there is consent;
(4) the purpose is agricultural production;
(5) there is personal cultivation; and
(6) there is sharing of harvest or payment of rental.

Based on the allegations and reliefs prayed by the petitioner, it is clear that the action in the MTC was for forcible
entry. Allegation of tenancy does not divest the MTC of jurisdiction. In the present case, instead of conducting
a preliminary conference, the MTC immediately referred the case to the DARAB. This was contrary to the rules. In
the absence of any allegation of a tenancy relationship between the parties, the action was for recovery of
possession of real property that was within the jurisdiction of the regular courts. The CA, therefore, committed no
reversible error in setting aside the DARAB decision. WHEREFORE, the petition is DENIED.

8. Bumagat v. Arribay
DOCTRINE/S:

FACTS:
Petitioners are the registered owners, successors-in-interest, or possessors of agricultural land, in Isabela Province.
The certificates of title to the titled properties were issued in 1986 pursuant to emancipation patents.

On July 19, 2005, petitioners filed a Complaint for forcible entry against respondent before the MCTC. Petitioners
alleged that on May 9, 2005, respondent – with the aid of armed goons, and through the use of intimidation and
threats of physical harm – entered the above-described parcels of land and ousted them from their lawful
possession; that respondent then took over the physical possession and cultivation of these parcels of land; and
that petitioners incurred losses and injuries by way of lost harvests and other damages. Petitioners thus prayed for
injunctive relief, actual damages in the amount of not less than ₱40,000.00 for each cropping season lost.

Respondent filed a Motion to Dismiss, claiming that the subject properties are agricultural lands – which thus
renders the dispute an agrarian matter and subject to the exclusive jurisdiction of the Department of Agrarian
Reform Adjudication Board (DARAB). The MCTC denied the motion, finding that the pleadings failed to show the
existence of a tenancy or agrarian relationship between the parties that would bring their dispute within the
jurisdiction of the DARAB.

MCTC ruled in favour of the petitioners and added that it had jurisdiction over the case since there is no tenancy
relationship between the parties.

RTC affirmed MCTC findings that no tenancy or any other agrarian relationship existed between the parties, nor do
the pleadings bear out such fact; that the evidence preponderantly shows that petitioners were in actual possession
of the subject land; and that petitioners were entitled to compensation as awarded by the court a quo.

CA reversed the decisions of MCTC and RTC.

 ISSUE/S: Whether MCTC or DARAB had jurisdiction over the complaint of the petitioners? YES

RULING:
MCTC has jurisdiction. The Court grants the Petition.

In declaring that the parties’ dispute fell under the jurisdiction of the DARAB, what the appellate court failed to
realize, however, is the fact that as between petitioners and the respondent, there is no tenurial arrangement, not
even an implied one. As correctly argued by petitioners, a case involving agricultural land does not immediately
qualify it as an agrarian dispute. The mere fact that the land is agricultural does not ipso facto make the possessor
an agricultural lessee or tenant. There are conditions or requisites before he can qualify as an agricultural lessee
or tenant, and the subject being agricultural land constitutes just one condition. For the DARAB to acquire
jurisdiction over the case, there must exist a tenancy relation between the parties. "In order for a tenancy agreement
to take hold over a dispute, it is essential to establish all its indispensable elements, to wit:

1) that the parties are the landowner and the tenant or agricultural lessee;
2) that the subject matter of the relationship is an agricultural land;
3) that there is consent between the parties to the relationship;
4) that the purpose of the relationship is to bring about agricultural production;
5) that there is personal cultivation on the part of the tenant or agricultural lessee; and
6) that the harvest is shared between the landowner and the tenant or agricultural lessee."

In the present case, it is quite evident that not all of these conditions are present. For one, there is no tenant, as
both parties claim ownership over the property.
Besides, when petitioners obtained their emancipation patents and subsequently their certificates of title, they
acquired vested rights of absolute ownership over their respective landholdings. "It presupposes that the grantee
or beneficiary has, following the issuance of a certificate of land transfer, already complied with all the preconditions
required under P.D. No. 27, and that the landowner has been fully compensated for his property. And upon the
issuance of title, the grantee becomes the owner of the landholding and he thereby ceases to be a mere tenant or
lessee. When petitioners’ titles were issued in 1986, these became indefeasible and incontrovertible.

For the above reasons, the Court is not inclined to believe respondent’s contention that with the issuance of the
December 29, 1994 Order of the Department of Agrarian Reform, Region 2 in an Administrative Case ordering the
cancellation of petitioners’ titles, the latter were relegated to the status of mere tenants. Nor can the Court agree
with the appellate court’s observation that through the forcible entry case, petitioners impliedly seek to exclude the
property from land reform coverage; there is no factual or legal basis for such conclusion.

It may be concluded that petitioners exercised prior peaceful and uninterrupted possession of the property until the
same was interrupted by respondent’s forcible intrusion in 2005; being farmer beneficiaries under PD 27 and finally
having acquired title to the property in 1986, the Court is inclined to believe that petitioners continued to till their
landholdings without fail. Indeed, the evidence on record indicates such peaceful and undisturbed possession, while
respondent’s claim that he entered the property as early as in 1993 remains doubtful, in light of his own admission
that he sued petitioners for the collection of supposed rentals which they owed him since 1995.

Finally, respondent’s submissions are unreliable for being contradictory. In some of his pleadings, he claims to have
acquired possession over the property as early as in 1993; in others, he declares that he entered the land in 2003.
Irreconcilable and unexplained contradictions on vital points in respondent’s account necessarily disclose a
weakness in his case.

9. Islanders v. Lapanday
DOCTRINE/S:

Agrarian Reform Law.

The Department of Agrarian Reform (DAR) was vested with the primary and exclusive jurisdiction both original
and appellate to determine and adjudicate all matters involving the implementation of agrarian reform.

Elements to prove tenancy or an agricultural leasehold agreement

To prove tenancy or an agricultural leasehold agreement, it is normally necessary to establish the following
elements:
1) the parties are the landowner and the tenant or agricultural lessee;
2) the subject matter of the relationship is a piece of 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 the landowner and the tenant or agricultural lessee.

Agrarian Disputes
An agrarian dispute refers to any controversy relating to tenurial arrangement— whether leasehold, tenancy,
stewardship or otherwise—over lands devoted to agriculture; The definition is broad enough to include disputes
arising from any tenurial arrangement beyond that in the traditional landowner-tenant or lessor-lessee relationship

FACTS:

On March 8, 1993, a certain Ramon Cajegas entered into a Joint Production Agreement for Islanders Carp-
Farmer Beneficiaries Multi-Purpose Cooperative, Inc. (petitioner) with Lapanday Agricultural and
Development Corporation (respondent).

Almost three years after, on April 2, 1996, the petitioner, represented by its alleged chairman, Manuel K. Asta,
filed a complaint with the RTC for Declaration of Nullity, Mandamus, Damages, with prayer for Preliminary
Injunction against the respondent, the alleged x x x officers of the petitioner who entered into the agreement, and
the Provincial Agrarian Reform Office of Davao (hereinafter PARO), represented by Saturnino D. Sibbaluca. the
petitioner subsequently filed an amended complaint with leave of court alleging that the persons, who
executed the contract were not authorized by it.

The respondent then filed a Motion to Dismiss on April 18, 1996 x x x, stating that:
(1) the Department of Agrarian Reform Adjudication Board (hereinafter DARAB) has primary, exclusive, and
original jurisdiction;
(2) that the petitioner failed to comply with the compulsory mediation and conciliation proceedings at the
barangay level; and
(3) for the unauthorized institution of the complaint in behalf of the petitioner.

The respondent also averred that the petitioner was engaged in forum shopping because [it] also filed a petition
before the Department of Agrarian Reform praying for the disapproval of the Joint Production Agreement. x x x
PARO also filed a motion to dismiss on May 16, 1996.

On August 21, 1996, the respondent then filed a case at the DARAB for Breach of Contract, Specific
Performance, Injunction with Restraining Order, Damages and Attorney's Fees.

On February 25, 1997, the DARAB decided the case in favor of the respondent declaring the Joint Production
Agreement as valid and binding and ordering the petitioner to account for the proceeds of the produce
and to comply with the terms of the contract. The RTC then issued its decision on October 18, 1999.

The petitioner, before the CA, raised the following errors on appeal:

1. The RTC gravely erred in dismissing the case at bar on the ground of lack of jurisdiction.
2. The RTC gravely erred in not declaring the joint production agreement as null and void ab initio.

Ruling of the Court of Appeals

Finding the relationship between the parties to be an agricultural leasehold, the CA held that the issue fell
squarely within the jurisdiction of the DARAB. Hence, the appellate court ruled that the RTC had correctly
dismissed the Complaint filed by petitioner.

Moreover, being in the nature of an agricultural leasehold and not a shared tenancy, the Joint Production
Agreement entered into by the parties was deemed valid by the CA. The agreement could not be
considered contrary to public policy, simply because one of the parties was a corporation.

Hence, this Petition.

ISSUE/S:
 (1) Whether or not the questioned Department of Agrarian Reform Adjudication Board has jurisdiction over the
case. - YES

(2) Whether or not the case does not constitute an agrarian dispute that falls within the jurisdiction of DARAB. –
YES

RULING:
(1) Section 50 of Republic Act 6657 and Section 17 of Executive Order 229 vests in the Department of Agrarian
Reform (DAR) the primary and exclusive jurisdiction, both original and appellate, to determine and adjudicate all
matters involving the implementation of agrarian reform. Through Executive Order 129-A, the President of the
Philippines created the DARAB and authorized it to assume the powers and functions of the DAR pertaining to the
adjudication of agrarian reform cases.

Moreover, Rule II of the Revised Rules of the DARAB provides as follows:

"Section 1. Primary and Exclusive Original and Appellate Jurisdiction. -- The Board shall have primary and exclusive
jurisdiction, both original and appellate, to determine and adjudicate all agrarian disputes involving the
implementation of the Comprehensive Agrarian Reform Program (CARP) under Republic Act No. 6657, Executive
Order Nos. 228 and 129-A, Republic Act No. 3844 as amended by Republic Act No. 6389, Presidential Decree No.
27 and other agrarian laws and their implementing rules and regulations. Specifically, such jurisdiction shall include
but not be limited to cases involving the following:

a) The rights and obligations of persons, whether natural or juridical, engaged in the management, cultivation and
use of all agricultural lands covered by the CARP and other agrarian laws[.]"

The subject matter of the present controversy falls squarely within the jurisdiction of the DARAB. In question are
the rights and obligations of two juridical persons engaged in the management, cultivation and use of agricultural
land acquired through the Comprehensive Agrarian Reform Program (CARP) of the government.

(2) To prove tenancy or an agricultural leasehold agreement, it is normally necessary to establish the following
elements:
1) the parties are the landowner and the tenant or agricultural lessee;
2) the subject matter of the relationship is a piece of 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 the landowner and the tenant or agricultural lessee.

In the present case, the fifth element of personal cultivation is clearly absent. Petitioner is thus correct in claiming
that the relationship between the parties is not one of tenancy or agricultural leasehold. Nevertheless, the SC
believes that the present controversy still falls within the sphere of agrarian disputes.

10. Cubero v. Laguna West Multipurpose Cooperative

DOCTRINE/S:

FACTS:

Petitioners are the registered owners of various parcels of land covered by twelve (12) Transfer Certificates of Title
(TCTs). They entered into a Joint Venture Development Agreement with co-petitioner Belle Corporation to develop
the properties as part of an agricultural farm lot subdivision project known as "Plantation Hills at Tagaytay
Greenlands Phase I" (the Project) for eventual sale to the public.

Claiming that as early as 1996, it entered into separate Joint Venture Agreements (JVAs) with the herein individual
petitioners' predecessors-in-interest and that it registered the JVAs in August 2000 on the previous owners' titles
by way of an Adverse Claim, respondent Laguna West Cooperative filed 9 ex-parte petitions with the RTC, for
inscription of an adverse claim, the annotation of which the Registrar of Deeds allegedly failed to carry over to the
TCTs of individual petitioners under the Property Registration Decree. Laguna added that the petitions were filed
 to rectify the omission or error and to protect its vested, subsisting and valid rights under the JVAs. Accompanying
the petitions were Notices of Lis Pendens addressed to the Register of Deeds.

Petitioners likewise file a petition with the RTC for "Annulment of Joint Venture Agreements with prayer for the
issuance of a TRO and/or writs of Preliminary Injunction and Preliminary Mandatory Injunction and for Damages".
They contend that the JVAs with their predecessors-in-interest are void ab initio since they were executed within
the 10-year prohibitory period under Republic Act No. 6657 (Comprehensive Agrarian Reform Law of 1988), the
titles covering the properties having emanated from emancipation patents granted in November 1988 pursuant to
Presidential Decree No. 27; and that the JVAs fall under management contracts prohibited under Republic Act No.
6657. Invoking Article 1409 of the Civil Code, that the JVAs be declared inexistent and void for being contrary to
law and public policy. RTC dismissed such petition on the ground that the DAR through DARAB has primary
jurisdiction to determine the validity or invalidity of the JVAs and that although the instant case does not involve
agrarian dispute, it involves controversy or issue in the implementation of R.A. 6657.

ISSUE/S:
W/N the RTC correctly dismissed the petition on the ground that the DARAB has jurisdiction? – YES

RULING:
What determines the nature of an action, as well as which court has jurisdiction over it, are the allegations in the
complaint and the character of the relief sought.

The Department of Agrarian Reform (DAR) is vested with primary jurisdiction to determine and adjudicate agrarian
reform matters, with exclusive original jurisdiction over all matters involving the implementation of agrarian reform
except those falling under the exclusive jurisdiction of the Department of Agriculture and the Department of
Environment and Natural Resources. Original jurisdiction means jurisdiction to take cognizance of a case at its
inception, try it and pass judgment upon the law and facts, while exclusive jurisdiction precludes the idea of co-
existence and refers to jurisdiction possessed to the exclusion of others. The DARAB has been created to assume
the adjudicative powers and functions of the DAR. Thus, the DARAB has been vested with jurisdiction to try and
decide all agrarian disputes, cases, controversies, and matters or incidents involving the implementation of the
CARP. Its jurisdiction encompasses cases involving the "rights and obligations of persons, whether natural or
juridical, engaged in the management, cultivation and use of all agricultural lands" covered by Republic Act No.
6657 and other agrarian laws.

The JVAs subject of the petition for annulment of petitioners precisely involve the development and utilization of the
subject agricultural lands. As successors-in-interest of the beneficiaries of the agricultural lands, individual
petitioners seek to nullify the JVAs. Since the controversy involves the rights and obligations of persons engaged
in the management, cultivation and use of an agricultural land covered by CARP, the case falls squarely within the
jurisdictional ambit of the DAR.

A resolution of the instant case principally entails a determination of the alleged commission of prohibited acts under
Sections 27 and 7328 of Republic Act No. 6645. In cases where allegations of violation or circumvention of land
reform laws have been raised, this Court has declined to address them, it stating that petitioners must first plead
their case with the DARAB. Petition is denied.

11. Cuba v. Cuenco

DOCTRINE/S:

FACTS:

Respondent herein, Manuel Cuenco, Jr., was the registered owner of several parcels of agricultural land located
in Barangay Looc, Sibulan, Negros Oriental which he inherited from his deceased parents. The lots are primarily
planted to coconuts and bananas and have been tenanted since the 1960s by Rosendo Lastimoso being the original
tenant. Before he died, respondent’s mother, Milagros Cuenco, designated Guillerma Cuba and her husband
Romulo Cuba, herein petitioners, as the new tenants. Petitioners then constructed their residential house thereon
in Lot No. 3533 and after the death of his mother, respondent sent a letter to petitioners authorizing them to continue
tending the said lot 3533.
When the tenurial relationship between respondent and petitioners had been strained, respondent filed with the
Regional Agrarian Reform Adjudication Board, Department of Agrarian Reform (DAR), Cebu City a complaint for
declaration of nontenancy, ejectment, and accounting of farm income against petitioners, Respondent prayed that
petitioners be ordered to vacate the landholding they are tilling. They also filed with the Municipal Trial Court (MTC),
Sibulan, Negros Oriental a civil complaint for unlawful detainer against petitioners, alleging that he has allowed
petitioners to construct their house on a portion of Lot No. 3533 on condition that they will peacefully vacate the
area should he need the same that at present he is in need of the land; and that despite his demands, petitioners
refused to vacate the same, thus, he is constrained to file the complaint for illegal detainer against them.

Petitioners averred that they are legitimate tenants; that respondent filed the complaint because he wanted to
designate spouses Joventino and Victoria Abo to replace them and that the MTC has no jurisdiction over Civil Case
as it involves an agrarian dispute.

MTC dismissed respondent’s complaint for lack of jurisdiction, holding that it involves an agrarian controversy which
falls within the jurisdiction of the Department of Agrarian Reform Adjudication Board (DARAB). On appeal, the
Regional Trial Court (RTC), Dumaguete City rendered its Decision dated July 15, 1999 affirming the MTC Order.
Respondent then filed with the Court of Appeals a Petition for Review assailing the RTC Decision. Meanwhile, on
September 10, 1999, the DARAB handed down its decision in favor of petitioners and enjoined respondent from
disturbing petitioners’ peaceful possession of the land they have been cultivating.

On January 30, 2002, the Court of Appeals rendered its Decision in favor of respondent, reversing the RTC Decision
and holding that respondent’s complaint does not involve an agrarian controversy, hence, the MTC has jurisdiction
over it. Court of Appeals found that the disputed property is residential, not agricultural, as evidenced by: (1) a
Certification by the Provincial Assessor of Negros Oriental stating that Lot No. 3533 has been classified as
residential by the Municipal Assessor of Sibulan and; (2) a Certification dated June 4, 1999 issued by the Office of
the Zoning Administrator, Housing and Land Use Regulatory Board stating that both the Sangguniang Bayan of
Sibulan and the Sangguniang Panlalawigan of Negros Oriental approved the reclassification of Lot No. 3533 from
agricultural to residential land. Hence the instant petition.

ISSUE/S: WON respondent’s complaint for illegal detainer against petitioners involving their home lot is an agrarian
dispute.

RULING:

YES. The jurisdiction of a tribunal, including a quasi-judicial agency, over the subject matter of a complaint or petition
is determined by the allegations therein. However, in determining jurisdiction, it is not only the nature of the
issues or questions that is the subject of the controversy that should be determined, but also the status or
relationship of the parties.6 Thus, if the issues between the parties are intertwined with the resolution of an issue
within the exclusive jurisdiction of the DARAB, such dispute must be addressed and resolved by the DARAB.
Section 50 of Republic Act No. 66578 provides:

SEC. 50. Quasi-Judicial Powers of the DAR.—The DAR is hereby vested with primary jurisdiction to determine
and adjudicate agrarian reform matters and shall have exclusive original jurisdiction over all matters
involving the implementation of agrarian reform, except those falling under the exclusive jurisdiction of the
Department of Agriculture (DA) and the Department of Environment and Natural Resources (DENR).

The court held that the Court of Appeals erred in holding that respondent’s complaint for illegal detainer does not
involve an agrarian dispute. Records show that respondent does not deny the existence of a tenancy relationship
between him and petitioners over Lot No. 3533. In fact, he invoked the jurisdiction of the DARAB. It bears reiterating
that this case pertains to respondent’s complaint for declaration of non-tenancy, ejectment, and accounting of farm
income involving the subject property against petitioners filed with the RARAD in Cebu City. In this case, the DARAB
declared petitioners as tenants and enjoined respondent from disturbing them in their peaceful occupation and
cultivation of Lot No. 3533. that respondent categorically states in his complaint that petitioners constructed a
residential house on the disputed portion of Lot No. 3533. On this point, Section 22 (3) of Republic Act No. 1199,12
as amended by Republic Act No. 2263, is relevant, thus providing: “The tenant’s dwelling shall not be removed
from the lot already assigned to him by the landholder, except as provided in section twentysix, unless
there is a severance of the tenancy relationship between them as provided under section nine, or unless the
tenant is ejected for cause and only after the expiration of fortyfive days following such severance of relationship or
dismissal for cause.” Likewise, Section 24 of Republic Act No. 3844,13 as amended by Republic Act No. 6389,
which states that “the agricultural lessee shall have the right to continue in the exclusive possession and enjoyment
 of any home lot he may have upon the effectivity of this Code, which shall be considered as included in the
leasehold.” Significantly, we have held that tenants are entitled to a home lot as an incident of their tenancy rights.

Clearly, Civil Case is an action by the landowner to oust his tenant from the latter’s home lot. Thus, the dispute is
agrarian in nature falling within the jurisdictional domain of the DARAB. This is in line with the doctrine of primary
jurisdiction which precludes the regular courts from resolving a controversy over which jurisdiction has been
lodged with an administrative body of special competence.

12. Association of Small Landowners in the Philippines v. Sec. of Agrarian Reform

Refer to Case # 1

13. Roxas v. CA
DOCTRINE/S:

FACTS:
Petitioner was informed that 1,023.999 hectares of its land in Hacienda Palico were subject to immediate
acquisition and distribution by the government under the CARL; that based on the DAR's valuation criteria, the
government was offering compensation of P3.4 million for 333.0800 hectares; that whether this offer was to be
accepted or rejected, petitioner was to inform the Bureau of Land Acquisition and Distribution (BLAD) of the DAR;
that in case of petitioner's rejection or failure to reply within thirty days, respondent DAR shall conduct summary
administrative proceedings with notice to petitioner to determine just compensation for the land; that if petitioner
accepts respondent DAR's offer, or upon deposit of the compensation with an accessible bank if it rejects the same,
the DAR shall take immediate possession of the land.
Almost two years later, on September 26, 1991, the DAR Regional Director sent to the LBP Land Valuation
Manager three (3) separate Memoranda entitled "Request to Open Trust Account." Each Memoranda requested
that a trust account representing the valuation of three portions of Hacienda Palico be opened in favor of the
petitioner in view of the latter's rejection of its offered value.
Despite petitioner's application for conversion, respondent DAR proceeded with the acquisition of the two
Haciendas. The LBP trust accounts as compensation for Hacienda Palico were replaced by respondent DAR with
cash and LBP bonds. On October 22, 1993, from the mother title of TCT No. 985 of the Hacienda, respondent DAR
registered Certificate of Land Ownership Award (CLOA) No. 6654. On October 30, 1993, CLOA's were distributed
to farmer beneficiaries.

Hacienda Banilad

On August 23, 1989, respondent DAR, through respondent MARO of Nasugbu, Batangas, sent a notice to petitioner
addressed as follows:

Mr. Jaime Pimentel

Hacienda Administrator
Hacienda Banilad
Nasugbu, Batangas

The MARO informed Pimentel that Hacienda Banilad was subject to compulsory acquisition under the
CARL; that should petitioner wish to avail of the other schemes such as Voluntary Offer to Sell or Voluntary Land
Transfer, respondent DAR was willing to provide assistance thereto.
On December 12, 1989, respondent DAR, through the Department Secretary, sent to petitioner two (2)
separate "Notices of Acquisition" over Hacienda Banilad. These Notices were sent on the same day as the Notice
of Acquisition over Hacienda Palico. Unlike the Notice over Hacienda Palico, however, the Notices over Hacienda
Banilad were addressed to:

Roxas y Cia. Limited

7th Floor, CachoGonzales
Bldg. 101 Aguirre St., Leg.
Makati, Metro Manila.

Respondent DAR offered petitioner compensation of P15,108,995.52 for 729.4190 hectares and P4,428,496.00 for
234.6498 hectares. On September 26, 1991, the DAR Regional Director sent to the LBP Land Valuation Manager
a "Request to Open Trust Account" in petitioner's name as compensation for 234.6493 hectares of Hacienda
Banilad. A second "Request to Open Trust Account" was sent on November 18, 1991 over 723.4130 hectares of
said Hacienda. On December 18, 1991, the LBP certified that the amounts of P4,428,496.40 and P21,234,468.78
in cash and LBP bonds had been earmarked as compensation for petitioner's land in Hacienda Banilad. On May 4,
1993, petitioner applied for conversion of both Haciendas Palico and Banilad.

Hacienda Caylaway
Hacienda Caylaway was voluntarily offered for sale to the government on May 6, 1988 before the effectivity
of the CARL. The Hacienda has a total area of 867.4571 hectares.
On January 12, 1989, respondent DAR, through the Regional Director for Region IV, sent to petitioner two
(2) separate Resolutions accepting petitioner's voluntary offer to sell Hacienda Caylaway, particularly TCT Nos.
T44664 and T44663. The Resolutions were addressed to:

Roxas & Company, Inc.

7th Flr. CachoGonzales Bldg.
Aguirre, Legaspi Village
Makati, M. M

Nevertheless, on August 6, 1992, petitioner, through its President, Eduardo J. Roxas, sent a letter to the
Secretary of respondent DAR withdrawing its VOS of Hacienda Caylaway. The Sangguniang Bayan of Nasugbu,
Batangas allegedly authorized the reclassification of Hacienda Caylaway from agricultural to nonagricultural. As a
result, petitioner informed respondent DAR that it was applying for conversion of Hacienda Caylaway from
agricultural to other uses.
In a letter dated September 28, 1992, respondent DAR Secretary informed petitioner that a reclassification
of the land would not exempt it from agrarian reform. Respondent Secretary also denied petitioner's withdrawal of
the VOS on the ground that withdrawal could only be based on specific grounds such as unsuitability of the soil for
agriculture, or if the slope of the land is over 18 degrees and that the land is undeveloped.
Despite the denial of the VOS withdrawal of Hacienda Caylaway, on May 11, 1993, petitioner filed its
application for conversion of both Haciendas Palico and Banilad.
On August 24, 1993 petitioner instituted Case No. N00179646 (BA) with respondent DAR Adjudication
Board (DARAB) praying for the cancellation of the CLOA's issued by respondent DAR in the name of several
persons. Petitioner alleged that the Municipality of Nasugbu, where the haciendas are located, had been declared
a tourist zone, that the land is not suitable for agricultural production, and that the Sangguniang Bayan of Nasugbu
had reclassified the land to nonagricultural.
In a Resolution dated October 14, 1993, respondent DARAB held that the case involved the prejudicial
question of whether the property was subject to agrarian reform, hence, this question should be submitted to the
Office of the Secretary of Agrarian Reform for determination.

ISSUE/S:
(1) W/N the acquisition proceedings over the three haciendas were valid and in accordance with law;
(2) assuming the haciendas may be reclassified from agricultural to nonagricultural, W/N this court has
the power to rule on this issue.
RULING:
1. NO. Procedure in the acquisition of private lands under the provisions of the law:

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

Republic Act No. 6657, the Comprehensive Agrarian Reform Law of 1988 (CARL), provides for two (2)
modes of acquisition of private land: compulsory and voluntary. The procedure for the compulsory acquisition of
private lands is set forth in Section 16 of R.A. 6657.

In the compulsory acquisition of private lands, the landholding, the landowners and the farmer beneficiaries
must first be identified. After identification, the DAR shall send a Notice of Acquisition to the landowner, by personal
delivery or registered mail, and post it in a conspicuous place in the municipal building and barangay hall of the
place where the property is located. Within thirty days from receipt of the Notice of Acquisition, the landowner, his
administrator or representative shall inform the DAR of his acceptance or rejection of the offer. If the landowner
accepts, he executes and delivers a deed of transfer in favor of the government and surrenders the certificate of
title. Within thirty days from the execution of the deed of transfer, the Land Bank of the Philippines (LBP) pays the
owner the purchase price. If the landowner rejects the DAR's offer or fails to make a reply, the DAR conducts
summary administrative proceedings to determine just compensation for the land. The landowner, the LBP
representative and other interested parties may submit evidence on just compensation within fifteen days from
notice. Within thirty days from submission, the DAR shall decide the case and inform the owner of its decision and
the amount of just compensation. Upon receipt by the owner of the corresponding payment, or, in case of rejection
or lack of response from the latter, the DAR shall deposit the compensation in cash or in LBP bonds with an
accessible bank. The DAR shall immediately take possession of the land and cause the issuance of a transfer
certificate of title in the name of the Republic of the Philippines. The land shall then be redistributed to the farmer
beneficiaries. Any party may question the decision of the DAR in the regular courts for final determination of just
compensation.

B. The Compulsory Acquisition of Haciendas Palico and Banilad

In the case at bar, respondent DAR claims that it, through MARO Leopoldo C. Lejano, sent a letter of invitation
entitled "Invitation to Parties" dated September 29, 1989 to petitioner corporation, through Jaime Pimentel, the
administrator of Hacienda Palico. The invitation was received on the same day it was sent as indicated by a
signature and the date received at the bottom left corner of said invitation. With regard to Hacienda Banilad,
respondent DAR claims that Jaime Pimentel, administrator also of Hacienda Banilad, was notified and sent an
invitation to the conference. Pimentel actually attended the conference on September 21, 1989 and signed the
Minutes of the meeting on behalf of petitioner corporation. The Minutes was also signed by the representatives of
the BARC, the LBP and farmer beneficiaries. No letter of invitation was sent or conference meeting held with respect
to Hacienda Caylaway because it was subject to a Voluntary Offer to Sell to respondent DAR.

When respondent DAR, through the Municipal Agrarian Reform Officer (MARO), sent to the various parties the
Notice of Coverage and invitation to the conference, DAR A.O. No. 12, Series of 1989 was already in effect more
than a month earlier. The Operating Procedure in DAR Administrative Order No. 12 does not specify how notices
or letters of invitation shall be sent to the landowner, the representatives of the BARC, the LBP, the farmer
beneficiaries and other interested parties. The procedure in the sending of these notices is important to comply with
the requisites of due process especially when the owner, as in this case, is a juridical entity. Petitioner is a domestic
corporation, and therefore, has a personality separate and distinct from its shareholders, officers and employees.

The Notice of Acquisition in Section 16 of the CARL is required to be sent to the landowner by "personal delivery
or registered mail." Whether the landowner be a natural or juridical person to whose address the Notice may be
sent by personal delivery or registered mail, the law does not distinguish. The DAR Administrative Orders also do
not distinguish. In the proceedings before the DAR, the distinction between natural and juridical persons in the
sending of notices may be found in the Revised Rules of Procedure of the DAR Adjudication Board (DARAB).
Service of pleadings before the DARAB is governed by Section 6, Rule V of the DARAB Revised Rules of
Procedure. Notices and pleadings are served on private domestic corporations or partnerships in the following
manner:

Sec. 6. Service upon Private Domestic Corporation or Partnership. — If the defendant is a corporation organized
under the laws of the Philippines or a partnership duly registered, service may be made on the president, manager,
secretary, cashier, agent, or any of its directors or partners.

Similarly, the Revised Rules of Court of the Philippines, in Section 13, Rule 14 provides:

Sec. 13. Service upon private domestic corporation or partnership. — If the defendant is a corporation organized
under the laws of the Philippines or a partnership duly registered, service may be made on the president, manager,
secretary, cashier, agent, or any of its directors.

Summonses, pleadings and notices in cases against a private domestic corporation before the DARAB and the
regular courts are served on the president, manager, secretary, cashier, agent or any of its directors. These persons
are those through whom the private domestic corporation or partnership is capable of action.

Jaime Pimentel is not the president, manager, secretary, cashier or director of petitioner corporation.

Assuming further that petitioner was duly notified of the CARP coverage of its haciendas, the areas found actually
subject to CARP were not properly identified before they were taken over by respondent DAR. Respondents insist
that the lands were identified because they are all registered property and the technical description in their
respective titles specifies their metes and bounds. Respondents admit at the same time, however, that not all areas
 in the haciendas were placed under the comprehensive agrarian reform program invariably by reason of elevation
or character or use of the land.

The acquisition of the landholdings did not cover the entire expanse of the two haciendas, but only portions thereof.
Hacienda Palico has an area of 1,024 hectares and only 688.7576 hectares were targetted for acquisition. Hacienda
Banilad has an area of 1,050 hectares but only 964.0688 hectares were subject to CARP. The haciendas are not
entirely agricultural lands. In fact, the various tax declarations over the haciendas describe the landholdings as
"sugarland," and "forest, sugarland, pasture land, horticulture and woodland."

Under Section 16 of the CARL, the sending of the Notice of Acquisition specifically requires that the land subject
to land reform be first identified. The two haciendas in the instant case cover vast tracts of land. Before Notices of
Acquisition were sent to petitioner, however, the exact areas of the landholdings were not properly segregated and
delineated. Upon receipt of this notice, therefore, petitioner corporation had no idea which portions of its estate
were subject to compulsory acquisition, which portions it could rightfully retain, whether these retained portions
were compact or contiguous, and which portions were excluded from CARP coverage. Even respondent DAR's
evidence does not show that petitioner, through its duly authorized representative, was notified of any ocular
inspection and investigation that was to be conducted by respondent DAR. Neither is there proof that petitioner was
given the opportunity to at least choose and identify its retention area in those portions to be acquired compulsorily.
The right of retention and how this right is exercised, is guaranteed in Section 6 of the CARL.
Under the law, a landowner may retain not more than five hectares out of the total area of his agricultural land
subject to CARP. The right to choose the area to be retained, which shall be compact or contiguous, pertains to the
landowner. If the area chosen for retention is tenanted, the tenant shall have the option to choose whether to remain
on the portion or be a beneficiary in the same or another agricultural land with similar or comparable features.

C. The Voluntary Acquisition of Hacienda Caylaway

Hacienda Caylaway was voluntarily offered for sale in 1989. The Hacienda has a total area of 867.4571 hectares
and is covered by four (4) titles. In two separate Resolutions both dated January 12, 1989, respondent DAR, through
the
Regional Director, formally accepted the VOS over the two of these four titles. The land covered by two titles has
an area of 855.5257 hectares, but only 648.8544 hectares thereof fell within the coverage of R.A. 6657. Petitioner
claims it does not know where these portions are located.

Respondent DAR, on the other hand, avers that surveys on the land covered by the four titles were conducted in
1989, and that petitioner, as landowner, was not denied participation therein, The results of the survey and the land
valuation summary report, however, do not indicate whether notices to attend the same were actually sent to and
received by petitioner or its duly authorized representative. To reiterate, Executive Order No. 229 does not lay down
the operating procedure, much less the notice requirements, before the VOS is accepted by respondent DAR.
Notice to the landowner, however, cannot be dispensed with. It is part of administrative due process and is an
essential requisite to enable the landowner himself to exercise, at the very least, his right of retention guaranteed
under the CARL.

2. NO. The doctrine of primary jurisdiction does not warrant a court to arrogate unto itself authority to resolve a
controversy the jurisdiction over which is initially lodged with an administrative body of special competence.
Respondent DAR is in a better position to resolve petitioner's application for conversion, being primarily the agency
possessing the necessary expertise on the matter. The power to determine whether Haciendas Palico, Banilad and
Caylaway are nonagricultural, hence, exempt from the coverage of the CARL lies with the DAR, not with this Court.

14. Hacienda Luisita v. PARC

DOCTRINE/S:

FACTS:
In 1958, the Spanish owners of Compañia General de Tabacos de Filipinas (Tabacalera) sold Hacienda Luisita and
the Central Azucarera de Tarlac, the sugar mill of the hacienda, to the Tarlac Development Corporation (Tadeco),
then owned and controlled by the Jose Cojuangco Sr. Group. The Central Bank of the Philippines assisted Tadeco
in obtaining a dollar loan from a US bank. Also, the GSIS extended a PhP5.911 million loan in favor of Tadeco to
pay the peso price component of the sale, with the condition that “the lots comprising the Hacienda Luisita be
subdivided by the applicant-corporation and sold at cost to the tenants, should there be any, and whenever
conditions should exist warranting such action under the provisions of the Land Tenure Act.” Tadeco allegedly
however did not comply with this condition.

On May 7, 1980, the martial law administration filed a suit before the Manila RTC against Tadeco, et al., for them
to surrender Hacienda Luisita to the then Ministry of Agrarian Reform (MAR) so that the land can be distributed to
farmers at cost. Responding, Tadeco alleged that Hacienda Luisita does not have tenants, besides which sugar
lands – of which the hacienda consisted – are not covered by existing agrarian reform legislations. The Manila RTC
rendered judgment ordering Tadeco to surrender Hacienda Luisita to the MAR. Therefrom, Tadeco appealed to the
CA.

On March 17, 1988, during the administration of President Corazon Cojuangco Aquino, the Office of the Solicitor
General moved to withdraw the government’s case against Tadeco, et al. The CA dismissed the case, subject to
the PARC’s approval of Tadeco’s proposed stock distribution plan (SDP) in favor of its farmworkers. [Under EO 229
and later RA 6657, Tadeco had the option of availing stock distribution as an alternative modality to actual land
transfer to the farmworkers.] On August 23, 1988, Tadeco organized a spin-off corporation, herein petitioner HLI,
as vehicle to facilitate stock acquisition by the farmworkers. For this purpose, Tadeco conveyed to HLI the
agricultural land portion (4,915.75 hectares) and other farm-related properties of Hacienda Luisita in exchange for
HLI shares of stock.

On May 9, 1989, some 93% of the then farmworker-beneficiaries (FWBs) complement of Hacienda Luisita signified
in a referendum their acceptance of the proposed HLI’s Stock Distribution Option Plan (SODP). On May 11, 1989,
the SDOA was formally entered into by Tadeco, HLI, and the 5,848 qualified FWBs. This attested to by then DAR
Secretary Philip Juico. The SDOA embodied the basis and mechanics of HLI’s SDP, which was eventually approved
by the PARC after a follow-up referendum conducted by the DAR on October 14, 1989, in which 5,117 FWBs, out
of 5,315 who participated, opted to receive shares in HLI.

On August 15, 1995, HLI applied for the conversion of 500 hectares of land of the hacienda from agricultural to
industrial use, pursuant to Sec. 65 of RA 6657. The DAR approved the application on August 14, 1996, subject to
payment of three percent (3%) of the gross selling price to the FWBs and to HLI’s continued compliance with its
undertakings under the SDP, among other conditions.

On December 13, 1996, HLI, in exchange for subscription of 12,000,000 shares of stocks of Centennary Holdings,
Inc. (Centennary), ceded 300 hectares of the converted area to the latter. Subsequently, Centennary sold the entire
300 hectares for PhP750 million to Luisita Industrial Park Corporation (LIPCO), which used it in developing an
industrial complex. From this area was carved out 2 parcels, for which 2 separate titles were issued in the name of
LIPCO. Later, LIPCO transferred these 2 parcels to the Rizal Commercial Banking Corporation (RCBC) in payment
of LIPCO’s PhP431,695,732.10 loan obligations to RCBC. LIPCO’s titles were cancelled and new ones were issued
to RCBC. Apart from the 500 hectares, another 80.51 hectares were later detached from Hacienda Luisita and
acquired by the government as part of the Subic-Clark-Tarlac Expressway (SCTEX) complex. Thus, 4,335.75
hectares remained of the original 4,915 hectares Tadeco ceded to HLI.

Such, was the state of things when two separate petitions reached the DAR in the latter part of 2003. The first was
filed by the Supervisory Group of HLI (Supervisory Group), praying for a renegotiation of the SDOA, or, in the
alternative, its revocation. The second petition, praying for the revocation and nullification of the SDOA and the
distribution of the lands in the hacienda, was filed by Alyansa ng mga Manggagawang Bukid ng Hacienda Luisita
(AMBALA). The DAR then constituted a Special Task Force (STF) to attend to issues relating to the SDP of HLI.
After investigation and evaluation, the STF found that HLI has not complied with its obligations under RA 6657
despite the implementation of the SDP. On December 22, 2005, the PARC issued the assailed Resolution No.
2005-32-01, recalling/revoking the SDO plan of Tadeco/HLI. It further resolved that the subject lands be forthwith
placed under the compulsory coverage or mandated land acquisition scheme of the CARP.

From the foregoing resolution, HLI sought reconsideration. Its motion notwithstanding, HLI also filed a petition
before the Supreme Court in light of what it considers as the DAR’s hasty placing of Hacienda Luisita under CARP
even before PARC could rule or even read the motion for reconsideration. PARC would eventually deny HLI’s
motion for reconsideration via Resolution No. 2006-34-01 dated May 3, 2006.
ISSUE/S:
(1) Does the PARC possess jurisdiction to recall or revoke HLI’s SDP?
 (2) [Issue raised by intervenor FARM (group of farmworkers)] Is Sec. 31 of RA 6657, which allows stock
transfer in lieu of outright land transfer, unconstitutional?

(3) Is the revocation of the HLI’s SDP valid? [Did PARC gravely abuse its discretion in revoking the subject
SDP and placing the hacienda under CARP’s compulsory acquisition and distribution scheme?]

(4) Should those portions of the converted land within Hacienda Luisita that RCBC and LIPCO acquired
by purchase be excluded from the coverage of the assailed PARC resolution? [Did the PARC gravely
abuse its discretion when it included LIPCO’s and RCBC’s respective properties that once formed part
of Hacienda Luisita under the CARP compulsory acquisition scheme via the assailed Notice of
Coverage?]

RULING:
(1) YES, the PARC has jurisdiction to revoke HLI’s SDP under the doctrine of necessary implication. Under
Sec. 31 of RA 6657, as implemented by DAO 10, the authority to approve the plan for stock distribution of the
corporate landowner belongs to PARC. Contrary to petitioner HLI’s posture, PARC also has the power to
revoke the SDP which it previously approved. It may be, as urged, that RA 6657 or other executive issuances
on agrarian reform do not explicitly vest the PARC with the power to revoke/recall an approved SDP. Such
power or authority, however, is deemed possessed by PARC under the principle of necessary implication, a
basic postulate that what is implied in a statute is as much a part of it as that which is expressed.
Following the doctrine of necessary implication, it may be stated that the conferment of express power to
approve a plan for stock distribution of the agricultural land of corporate owners necessarily includes the power
to revoke or recall the approval of the plan. To deny PARC such revocatory power would reduce it into a
toothless agency of CARP, because the very same agency tasked to ensure compliance by the corporate
landowner with the approved SDP would be without authority to impose sanctions for non-compliance with it.

(2) NO, Sec. 31 of RA 6657 is not unconstitutional. [The Court actually refused to pass upon the constitutional
question because it was not raised at the earliest opportunity and because 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.]

When the Court is called upon to exercise its power of judicial review over, and pass upon the constitutionality of,
acts of the executive or legislative departments, it does so only when the following essential requirements are first
met, to wit: (1) there is an actual case or controversy; (2) that the constitutional question is raised at the earliest
possible opportunity by a proper party or one with locus standi; and (3) the issue of constitutionality must be the
very lis mota of the case.

Not all the foregoing requirements are satisfied in the case at bar. The last but the most important requisite that the
constitutional issue must be the very lis mota of the case does not likewise obtain. The lis mota aspect is not present,
the constitutional issue tendered not being critical to the resolution of the case. The unyielding rule has been to
avoid, whenever plausible, an issue assailing the constitutionality of a statute or governmental act. If some other
grounds exist by which judgment can be made without touching the constitutionality of a law, such recourse is
favored.

The lis mota in this case, proceeding from the basic positions originally taken by AMBALA (to which the FARM
members previously belonged) and the Supervisory Group, is the alleged non-compliance by HLI with the conditions
of the SDP to support a plea for its revocation. And before the Court, the lis mota is whether or not PARC acted in
grave abuse of discretion when it ordered the recall of the SDP for such non-compliance and the fact that the SDP,
as couched and implemented, offends certain constitutional and statutory provisions. To be sure, any of these key
issues may be resolved without plunging into the constitutionality of Sec. 31 of RA 6657. Moreover, looking deeply
into the underlying petitions of AMBALA, et al., it is not the said section per se that is invalid, but rather it is the
alleged application of the said provision in the SDP that is flawed.

(3) YES, the revocation of the HLI’s SDP valid. [NO, the PARC did NOT gravely abuse its discretion in revoking
the subject SDP and placing the hacienda under CARP’s compulsory acquisition and distribution scheme.]

The revocation of the approval of the SDP is valid: (1) the mechanics and timelines of HLI’s stock distribution violate
DAO 10 because the minimum individual allocation of each original FWB of 18,804.32 shares was diluted as a
result of the use of “man days” and the hiring of additional farmworkers; (2) the 30-year timeframe for HLI-to-FWBs
stock transfer is contrary to what Sec. 11 of DAO 10 prescribes. [I]t is clear as day that the original 6,296 FWBs,
 who were qualified beneficiaries at the time of the approval of the SDP, suffered from watering down of shares. As
determined earlier, each original FWB is entitled to 18,804.32 HLI shares. The original FWBs got less than the
guaranteed 18,804.32 HLI shares per beneficiary, because the acquisition and distribution of the HLI shares were
based on “man days” or “number of days worked” by the FWB in a year’s time. As explained by HLI, a beneficiary
needs to work for at least 37 days in a fiscal year before he or she becomes entitled to HLI shares. If it falls below
37 days, the FWB, unfortunately, does not get any share at year end. The number of HLI shares distributed varies
depending on the number of days the FWBs were allowed to work in one year. Worse, HLI hired farmworkers in
addition to the original 6,296 FWBs, such that, as indicated in the Compliance dated August 2, 2010 submitted by
HLI to the Court, the total number of farmworkers of HLI as of said date stood at 10,502. All these farmworkers,
which include the original 6,296 FWBs, were given shares out of the 118,931,976.85 HLI shares representing the
33.296% of the total outstanding capital stock of HLI. Clearly, the minimum individual allocation of each original
FWB of 18,804.32 shares was diluted as a result of the use of “man days” and the hiring of additional farmworkers.

(4) YES, those portions of the converted land within Hacienda Luisita that RCBC and LIPCO acquired by
purchase should be excluded from the coverage of the assailed PARC resolution. [T]here are two (2)
requirements before one may be considered a purchaser in good faith, namely: (1) that the purchaser buys the
property of another without notice that some other person has a right to or interest in such property; and (2) that the
purchaser pays a full and fair price for the property at the time of such purchase or before he or she has notice of
the claim of another.

It can rightfully be said that both LIPCO and RCBC are––based on the above requirements and with respect to the
adverted transactions of the converted land in question––purchasers in good faith for value entitled to the benefits
arising from such status.

To be sure, intervenor RCBC and LIPCO knew that the lots they bought were subjected to CARP coverage by
means of a stock distribution plan, as the DAR conversion order was annotated at the back of the titles of the lots
they acquired. However, they are of the honest belief that the subject lots were validly converted to commercial or
industrial purposes and for which said lots were taken out of the CARP coverage subject of PARC Resolution No.
89-12-2 and, hence, can be legally and validly acquired by them. After all, Sec. 65 of RA 6657 explicitly allows
conversion and disposition of agricultural lands previously covered by CARP land acquisition “after the lapse of five
(5) years from its award when the land ceases to be economically feasible and sound for agricultural purposes or
the locality has become urbanized and the land will have a greater economic value for residential, commercial or
industrial purposes.” Moreover, DAR notified all the affected parties, more particularly the FWBs, and gave them
the opportunity to comment or oppose the proposed conversion. DAR, after going through the necessary
processes, granted the conversion of 500 hectares of Hacienda Luisita pursuant to its primary jurisdiction under
Sec. 50 of RA 6657 to determine and adjudicate agrarian reform matters and its original exclusive jurisdiction over
all matters involving the implementation of agrarian reform. The DAR conversion order became final and executory
after none of the FWBs interposed an appeal to the CA. In this factual setting, RCBC and LIPCO purchased the
lots in question on their honest and well-founded belief that the previous registered owners could legally sell and
convey the lots though these were previously subject of CARP coverage. Ergo, RCBC and LIPCO acted in good
faith in acquiring the subject lots.

15. Roman Catholic Archibishop of Caceres v. Sec. of Agrarian Reform

DOCTRINE/S:
The laws simply speak of the “landowner” without qualification as to under what title the land is held or what rights
to the land the landowner may exercise—there is no distinction made whether the landowner holds “naked title”
only or can exercise all the rights of ownership. — Archbishop’s arguments, while novel, must fail in the face of the
law and the dictates of the 1987 Constitution. The laws simply speak of the “landowner” without qualification as to
under what title the land is held or what rights to the land the landowner may exercise. There is no distinction made
whether the landowner holds “naked title” only or can exercise all the rights of ownership. Archbishop would have
us read deeper into the law, to create exceptions that are not stated in PD 27 and RA 6657, and to do so would be
to frustrate the revolutionary intent of the law, which is the redistribution of agricultural land for the benefit of landless
farmers and farmworkers.

Retention Limits; There can be no claim of more than one right of retention per landowner. — Archbishop was found
to be the registered owner of the lands in question, and does not contest that fact. For the purposes of the law, this
makes him the landowner, without the necessity of going beyond the registered titles. He cannot demand a deeper
examination of the registered titles and demand further that the intent of the original owners be ascertained and
followed. To adopt his reasoning would create means of sidestepping the law, wherein the mere act of donation
 places lands beyond the reach of agrarian reform. There can be no claim of more than one right of retention per
landowner. Neither PD 27 nor RA 6657 has a provision for a landowner to exercise more than one right of retention.
The law is simple and clear as to the retention limits per landowner.

FACTS:

Archbishop is the registered owner of several properties in Camarines Sur, with a total area of 268.5668 hectares.
A portion of the said land is planted with rice and corn, while the remaining portion is planted with coconut trees.
Archbishop filed with the Municipal Agrarian Reform District Office several petitions for exemption of certain
properties located in various towns of Camarines Sur from the coverage of Operation Land Transfer (OLT) under
P.D. No. 27. Two of these petitions were denied by the Regional Director of DAR, Region V.
Archbishop appealed several times until it was raised to the CA. The CA dismissed his petition; holding that
he is only entitled to assert one right of retention as the subject properties are registered in his name. Archbishop
argues that while the lands in question are registered in his name, he holds the lands in trust for the benefit of his
followers. Archbishop further argued that the deeds of donation by which the lands were transferred to him imposed
numerous fiduciary obligations, such that he cannot sell, exchange, lease, transfer, encumber, or mortgage the
subject lands. By this reasoning, Archbishop concluded that he is not the “landowner” contemplated by PD 27 and
Republic Act No. (RA) 6657.

ISSUE/S:

WON the Archbishop is entitled to assert only one right of retention as the subject properties are registered in his
name

WON the ruling in The Roman Catholic Apostolic Administrator of Davao, Inc. v. The Land Registration Commission
and the Register of Deeds of Davao City which, he cites, ruled that properties held by the Church are held by it as
a mere administrator for the benefit of the members of that particular religion is applicable

RULING:

NO. THERE IS ONLY ONE RIGHT OF RETENTION PER LANDOWNER, and NO MULTIPLE RIGHTS OF
RETENTION CAN BE HELD BY A SINGLE PARTY

The laws simply speak of the “landowner” without qualification as to under what title the land is held or what rights
to the land the landowner may exercise. There is no distinction made whether the landowner holds “naked title”
only or can exercise all the rights of ownership.
Archbishop was found to be the registered owner of the lands in question, and does not contest that
fact. For the purposes of the law, this makes him the landowner, without the necessity of going beyond the
registered titles. He cannot demand a deeper examination of the registered titles and demand further that the intent
of the original owners be ascertained and followed. To adopt his reasoning would create means of sidestepping
the law, wherein the mere act of donation places lands beyond the reach of agrarian reform.
There can be no claim of more than one right of retention per landowner. Neither PD 27 nor RA 6657 has
a provision for a landowner to exercise more than one right of retention. The law is simple and clear as to the
retention limits per landowner.
Archbishop would claim exemption from the coverage of agrarian reform by stating that he is a mere
administrator, but his position does not appear under the list of exemptions under RA 6657. His claimed status as
administrator does not create another class of lands exempt from the coverage of PD 27 or RA 6657, and The
Roman Catholic Apostolic Administrator of Davao, Inc. does not create another definition for the term “landowner.”
Archbishop cannot claim exemption in behalf of the millions of Filipino faithful, as the lands are clearly not
exempt under the law. He should not fear that his followers are simply being deprived of land, as under both PD 27
and RA 6657, he is entitled to just compensation, which he may then use for the benefit of his followers. His situation
is no different from other landowners affected by agrarian reform––they are somewhat deprived of their land, but it
is all for a greater good.

16. Natalia Realty v. DAR

DOCTRINE/S:
Coverage; Commercial, industrial and residential lands not included. — We now determine whether such lands are
covered by the CARL. Section 4 of R.A. 6657 provides that the CARL shall “cover, regardless of tenurial
arrangement and commodity produced, all public and private agricultural lands.” As to what constitutes “agricultural
land,” it is referred to as “land devoted to agricultural activity as defined in this Act and not classified as mineral,
forest, residential, commercial or industrial land.” The deliberations of the Constitutional Commission confirm this
limitation. “Agricultural lands” are only those lands which are “arable and suitable agricultural lands” and “do not
 include commercial, industrial and residential lands.” Based on the foregoing, it is clear that the undeveloped
portions of the Antipolo Hills Subdivision cannot in any language be considered as “agricultural lands.” These lots
were intended for residential use. They ceased to be agricultural lands upon approval of their inclusion in the
Lungsod Silangan Reservation. Even today, the areas in question continue to be developed as a low-cost housing
subdivision, albeit at a snail’s pace. This can readily be gleaned from the fact that SAMBA members even instituted
an action to restrain petitioners from continuing with such development. The enormity of the resources needed for
developing a subdivision may have delayed its completion, but this does not detract from the fact that these lands
are still residential lands and outside the ambit of the CARL.

FACTS:
Petitioner Natalia Realty, Inc. (NATALIA) is the owner of three (3) contiguous parcels of land located in
Banaba, Antipolo, Rizal. By virtue Presidential Proclamation No. 1637 NATALIA properties are situated within the
areas proclaimed as townsite reservation.
Estate Developers and Investors Corporation (EDIC), as developer of NATALIA properties, applied for and was
granted preliminary approval and locational clearances by the Human Settlements Regulatory Commission.
Petitioners were likewise issued development permits 7 after complying with the requirements. Thus the NATALIA
properties later became the Antipolo Hills Subdivision.
Acting on CARL, DAR issued a notice of coverage on the underdeveloped portions of Antipolo Hills. Natalia
Objected.
SAMBA filed a complaint against NATALIA and EDIC before the DAR Regional Adjudicator to restrain petitioners
from developing areas under cultivation by SAMBA members.
OSG maintain that the permits granted petitioners were not valid and binding because they did not comply
with the implementing Standards, Rules and Regulations of P.D. 957 hence there was no valid conversion.

ISSUE/S: W/N the lands under NATALIA properties are covered by the CARL

RULING:
NO. Section 4 of R.A. 6657 provides that the CARL shall "cover, regardless of tenurial arrangement and commodity
produced, all public and private agricultural lands." As to what constitutes "agricultural land," it is referred to as "land
devoted to agricultural activity as defined in this Act and not classified as mineral, forest, residential, commercial or
industrial land." 16 The deliberations of the Constitutional Commission confirm this limitation. "Agricultural lands"
are only those lands which are "arable and suitable agricultural lands" and "do not include commercial, industrial
and residential lands."
It is clear that the undeveloped portions of the Antipolo Hills Subdivision cannot in any language be considered as
"agricultural lands." These lots were intended for residential use. They ceased to be agricultural lands upon approval
of their inclusion in the Lungsod Silangan Reservation.
Since the NATALIA lands were converted prior to 15 June 1988, respondent DAR is bound by such conversion. It
was therefore error to include the undeveloped portions of the Antipolo Hills Subdivision within the coverage of
CARL.

17. DAR v. Sutton

DOCTRINE/S:
The Supreme Court clarified in the Luz Farms v. Secretary of DAR, 192 SCRA 51 (1990) that livestock,
swine and poultry-raising are industrial activities and do not fall within the definition of “agriculture” or “agricultural
activity.” — 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, pumphouses, sprayers, and other technological appurtenances.

The Department of Agrarian Reform has no power to regulate livestock farms which have been exempted
by the Constitution from the coverage of agrarian reform. —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. The subsequent case of Natalia Realty, Inc. v. DAR reiterated our ruling in the Luz Farms
case. In Natalia Realty, the Court held that industrial, commercial and residential lands are not covered by the
CARL. We stressed anew that while Section 4 of R.A. No. 6657 provides that the CARL shall cover all public and
private agricultural lands, the term “agricultural land” does not include lands classified as mineral, forest, residential,
commercial or industrial. Thus, in Natalia Realty, even portions of the Antipolo Hills Subdivision, which are arable
yet still undeveloped, could not be considered as agricultural lands subject to agrarian reform as these lots were
already classified as residential lands.

FACTS:
Substantial Facts: This case involved a land in Aroroy,Masbate inherited by respondents which has been devoted
exclusively to cow and calf breeding. On 1987, 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.

RA 6657, took effect which covered farms used for raising livestock, poultry and swine. Followed by the decision of
the Court in Luz Farms v. Secretary of DAR 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.”

Procedural Facts: Because of the Luz Farms ruling, 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. Municipal Agrarian Reform Officer inspected respondents’ land and recommended to the
DAR Secretary that it be exempted from the coverage of the CARL. Respondents then reiterated to petitioner the
withdrawal of their VOS and requested the return of the supporting papers they submitted in connection therewith.
Petitioner ignored their request. On the same year, 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. Respondents contented that their entire landholding is exempted from
the CARL. DAR Secretary Garilao issued an Order partially granting the application of respondents for exemption
from the coverage of CARL. Petitioner ordered the rest of respondents’ landholding to be segregated and placed
under Compulsory Acquisition. Respondents moved for reconsideration which was denied. They filed a notice of
appeal with the Office of the President which affirmed the said order because it does not run counter to the Luz
Farms case as the A.O. provided the guidelines to determine whether a certain parcel of land is being used for
cattle-raising. Respondent filed an appeal which the CA favored. It declared the said AO, void for being contrary to
the intent of the 1987 Constitutional Commission to exclude livestock farms from the land reform program of the
government. Hence, this petition.

ISSUE/S: WON DAR A.O. No. 9, series of 1993 prescribing a maximum retention limit for owners of lands devoted
to livestock raising is constitutional

RULING:
NO. 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, pumphouses, sprayers, and other technological
appurtenances.15
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.

FALLO: IN VIEW WHEREOF, the petition is DISMISSED. The assailed Decision and Resolution of the Court of
Appeals, dated September 19, 2003 and February 4, 2004, respectively, are AFFIRMED. No pronouncement as to
costs.
18. Milestone Farms v. Office of President
DOCTRINE/S:
Comprehensive Agrarian Reform Program (CARP); Department of Agrarian Reform (DAR) Secretary; Jurisdiction;
It is the Department of Agrarian Reform (DAR) Secretary who is vested with such jurisdiction and authority to exempt
and/or exclude a property from Comprehensive Agrarian Reform Program (CARP) coverage based on the factual
circumstances of each case and in accordance with law and applicable jurisprudence. — We cannot, without going
against the law, arbitrarily strip the DAR Secretary of his legal mandate to exercise jurisdiction and authority over
all ALI cases. To succumb to petitioner’s contention that “when a land is declared exempt from the CARP on the
ground that it is not agricultural as of the time the CARL took effect, the use and disposition of that land is entirely
and forever beyond DAR’s jurisdiction” is dangerous, suggestive of self-regulation. Precisely, it is the DAR Secretary
who is vested with such jurisdiction and authority to exempt and/or exclude a property from CARP coverage based
on the factual circumstances of each case and in accordance with law and applicable jurisprudence.

FACTS:
Substantial Facts: Petitioner Milestone Farms, Inc. (petitioner) was a corporation engaged in raising livestock,
poultry, and swine. RA 6657 included the raising of livestock, poultry, and swine in its coverage. However, the Court
ruled in Luz Farms v. Secretary of the DAR that agricultural lands devoted to livestock, poultry, and/or swine raising
are excluded from the Comprehensive Agrarian Reform Program (CARP).

Procedural Facts: Petitioner applied for the exemption/exclusion of its property from the coverage of the CARL,
pursuant to the aforementioned ruling of this Court in Luz Farms. Meanwhile, 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, which prompted petitioner to re-document its
application.

DAR’s Land Use Conversion and Exemption Committee (LUCEC) of Region IV recommended the exemption of
petitioner’s 316.0422-hectare property from the coverage of CARP. Adopting the LUCEC’s findings and
recommendation, DAR Regional Director Dalugdug issued an Order exempting petitioner’s property from CARP.

Pinugay Farmers represented by Balajadia moved for the reconsideration of the said Order, but was denied.
Subsequently, the Pinugay Farmers filed a letter-appeal with the DAR Secretary.

Petitioner filed a complaint for Forcible Entry against Balajadia and company before the MCTC, which ruled in favor
of petitioner, but the decision was later reversed by the RTC. Ultimately, the case reached the CA, which, reinstated
the MCTC’s ruling, ordering Balajadia and all defendants therein to vacate portions of the property

R.A. No. 6657 was amended by R.A. No. 7881, in which private agricultural lands devoted to livestock, poultry, and
swine raising were excluded from the coverage of the CARL.

The fact-finding team formed by the DAR Undersecretary for Field Operations and Support Services conducted an
actual headcount of the livestock population on the property.

DAR Secretary Garilao issued an Order exempting from CARP only 240.9776 hectares of the 316.0422 hectares
previously exempted by Director Dalugdug, and declaring remaining to be covered by CARP. Petitioner filed a
Motion for Reconsideration, which was denied petitioner’s Motion for Reconsideration. Aggrieved, petitioner filed
its Memorandum on Appeal before the Office of the President (OP), which declared the entire property exempt from
the coverage of CARP.

However, on separate motions for reconsideration of the aforesaid decision filed by farmer-groups Samahang Anak-
Pawis ng Lagundi and Pinugay Farmers, and the Bureau of Agrarian Legal Assistance of DAR, the OP issued a
resolution setting aside its previous decision.

Consequently, petitioner sought recourse from the CA, which granted the appeal and declared the entire property
to be exempted from CARP.

Meanwhile, six months earlier, without the knowledge of the CA – as the parties did not inform the appellate court
– then DAR Secretary Rene C. Villa (Secretary Villa) issued DAR Conversion Order granting petitioner’s application
 to convert portions of the property from agricultural to residential and golf courses use. CA amended its earlier
Decision, holding that its earlier Decision was theoretically not final. Petitioner filed a Motion for Reconsideration,
which was subsequently denied. Hence, this Petition.

ISSUE/S: WON DAR has exclusive jurisdiction for exemption in CARP coverage

RULING: YES. Finally, it is established that issues of Exclusion and/or Exemption are characterized as Agrarian
Law Implementation (ALI) cases which are well within the DAR Secretary’s competence and jurisdiction.65 Section
3, Rule II of the 2003 Department of Agrarian Reform Adjudication Board Rules of Procedure provides:

Section 3. Agrarian Law Implementation Cases.

The Adjudicator or the Board shall have no jurisdiction over matters involving the administrative implementation of
RA No. 6657, otherwise known as the Comprehensive Agrarian Reform Law (CARL) of 1988 and other agrarian
laws as enunciated by pertinent rules and administrative orders, which shall be under the exclusive prerogative of
and cognizable by the Office of the Secretary of the DAR in accordance with his issuances, to wit: x x x x

3.8 Exclusion from CARP coverage of agricultural land used for livestock, swine, and poultry raising.

Thus, we cannot, without going against the law, arbitrarily strip the DAR Secretary of his legal mandate to exercise
jurisdiction and authority over all ALI cases. To succumb to petitioner’s contention that "when a land is declared
exempt from the CARP on the ground that it is not agricultural as of the time the CARL took effect, the use and
disposition of that land is entirely and forever beyond DAR’s jurisdiction" is dangerous, suggestive of self-regulation.
Precisely, it is the DAR Secretary who is vested with such jurisdiction and authority to exempt and/or exclude a
property from CARP coverage based on the factual circumstances of each case and in accordance with law and
applicable jurisprudence. In addition, albeit parenthetically, Secretary Villa had already granted the conversion into
residential and golf courses use of nearly one-half of the entire area originally claimed as exempt from CARP
coverage because it was allegedly devoted to livestock production.

FALLO: WHEREFORE, the Petition is DENIED and the Court of Appeals Amended Decision dated October 4,
2006 and Resolution dated March 27, 2008 are AFFIRMED. No costs. SO ORDERED.

19. Central Mindanao University v. DARAB

DOCTRINE/S:
Court agrees with the DARAB’s finding that Obrique et. al, are not tenants. — We agree with the DARAB’s finding
that Obrique, et. al. are not tenants. Under the terms of the written agreement signed by Obrique, et. al., pursuant
to the livelihood program called “Kilusang Sariling Sikap Program”, it was expressly stipulated that no landlord
tenant relationship existed between the CMU and the faculty and staff (participants in the project). The CMU did not
receive any share from the harvest/fruits of the land tilled by the participants. What the CMU collected was a nominal
service fee and land use participant’s fee in consideration of all the kinds of assistance given to the participants by
the CMU.
Private respondents, not being tenants nor proven to be landless peasants, cannot qualify as beneficiaries under
the CARP. –— In view of the above, the private respondents, not being tenants nor proven to be landless peasants,
cannot qualify as beneficiaries under the CARP. Under Section 4 and Section 10 of R.A. 6657 it is crystal clear that
the jurisdiction of the DARAB is limited only to matters involving the implementation of the CARP.––Under Section
4 and Section 10 of R.A. 6657, it is crystal clear that the jurisdiction of the DARAB is limited only to matters involving
the implementation of the CARP. More specifically, it is restricted to agrarian cases and controversies involving
lands falling within the coverage of the aforementioned program. It does not include those which are actually, directly
and exclusively used and found to be necessary for, among such purposes, school sites and campuses for setting
up experimental farm stations, research and pilot production centers, etc.

DARAB has no power to try, head and adjudicate the case pending before it involving a portion of the CMU’s titled
school site. –— Consequently, the DARAB has no power to try, hear and adjudicate the case pending before it
involving a portion of the CMU’s titled school site, as the portion of the CMU land reservation ordered segregated
is actually, directly and exclusively used and found by the school to be necessary for its purposes. The CMU has
constantly raised the issue of the DARAB’s lack of jurisdiction and has questioned the respondent’s authority to
hear, try and adjudicate the case at bar.
Section 50 of R.A. 6657 confers on the DAR quasi-judicial powers. –— Section 50 of R.A. 6657 confers on the DAR
quasi-judicial powers as follows: The DAR is hereby vested with primary jurisdiction to determine and adjudicate
agrarian reform matters and shall have original jurisdiction over all matters involving the implementation of agrarian
reform x x x.

There is no doubt that the DARAB has jurisdiction to try and decide any agrarian dispute in the implementation of
the CARP; Definition of agrarian dispute — Section 17 of Executive Order No. 129-A is merely a repetition of Section
50, R.A. 6657. There is no doubt that the DARAB has jurisdiction to try and decide any agrarian dispute in the
implementation of the CARP.

FACTS:

Substantial Facts: CMU is an agricultural university. In 1984, the CMU approved Resolution No. 160, adopting a
livelihood program called "Kilusang Sariling Sikap Program" under which the land resources of the University were
leased to its faculty and employees. It was expressly stipulated that no landlord-tenant relationship existed between
the CMU and the faculty and/or employees. When petitioner Chua became President of the CMU in July 1986, he
discontinued the Agri-Business Management and Training Project, due to losses incurred while carrying on the said
project. Some CMU personnel, among whom were the complainants, were laid-off when this project was
discontinued. This has the same nature as of the Kilusang Sariling Sikap Program with an express provision that
there would be no tenant-landlord relationship.

The contract expired. Some were renewed, some were not. The non-renewal of the contracts, the discontinuance
of the rice, corn and sugar cane project, the loss of jobs due to termination or separation from the service and the
alleged harassment by school authorities, all contributed to, and precipitated the filing of the complaint.

Procedural Facts: This is a Petition for Review on Certiorari under Rule 65 of the Rules of Court to nullify the
proceedings and decision of the Department of Agrarian Reform Adjudication Board and to set aside the decision
of the Court of Appeals affirming the decision of the DARAB.

ISSUE/S:
a. WON the complainants are tenants of CMU, hence, beneficiaries of CARP.
b. WON CMU is subject to CARP.
c. WON DARAB has jurisdiction to hear and decide Case No. 005 for Declaration of Status of Tenants and coverage
of land under the CARP.

RULING:

a. NO. We agree with the DARAB's finding that Obrique, et. al. are not tenants. The CMU did not receive any
share from the harvest/fruits of the land tilled by the participants. What the CMU collected was a nominal service
fee and land use participant's fee in consideration of all the kinds of assistance given to the participants by the
CMU. Again, the agreement signed by the participants under the CMU-IEP clearly stipulated that no landlord-
tenant relationship existed, and that the participants are not share croppers nor lessees, and the CMU did not
share in the produce of the participants' labor.
Obrique is not a landless peasant. The facts showed he was Physics Instructor at CMU holding a very
responsible position was separated from the service on account of certain irregularities he committed while
Assistant Director of the Agri-Business Project of cultivating lowland rice. Others may, at the moment, own no
land in Bukidnon but they may not necessarily be so destitute in their places of origin. No proof whatsoever
appears in the record to show that they are landless peasants. In view of the above, the private respondents,
not being tenants nor proven to be landless peasants, cannot qualify as beneficiaries under the CARP.
b. NO. CMU is not covered by the CARP because:
xxx
4. It is exempt from coverage under Section 10 of R.A. 6657 because the lands are actually, directly and
exclusively used and found to be necessary for school site and campus, including experimental farm stations
for educational purposes, and for establishing seed and seedling research and pilot production centers

Xxx

c. NO. DARAB has no jurisdiction. Under Section 4 and Section 10 of R.A. 6657, it is crystal clear that the
jurisdiction of the DARAB is limited only to matters involving the implementation of the CARP. More specifically,
it is restricted to agrarian cases and controversies involving lands falling within the coverage of the
 aforementioned program. It does not include those which are actually, directly and exclusively used and found
to be necessary for, among such purposes, school sites and campuses for setting up experimental farm
stations, research and pilot production centers, etc

20. Department of Agrarian Reform v. DECS

DOCTRINE/S:
Comprehensive Agrarian Reform Program (CARP); In order for land for educational purposes to be exempt from
the coverage of the CARP, (1) the land must be “actually, directly and exclusively used and found to be necessary,”
and (2) the purpose is “for school sites and campuses, including experimental farm stations operated by public or
private schools for educational purposes.” — Section 10 of R.A. No. 6657 enumerates the types of lands which are
exempted from the coverage of CARP as well as the purposes of their exemption, viz: xxx xxx xxx c) Lands actually,
directly and exclusively used and found to be necessary for national defense, school sites and campuses, including
experimental farm stations operated by public or private schools for educational purposes, . . . , shall be exempt
from the coverage of this Act. xxx xxx xxx Clearly, a reading of the paragraph shows that, in order to be exempt
from the coverage: 1) the land must be “actually, directly, and exclusively used and found to be necessary;” and 2)
the purpose is “for school sites and campuses, including experimental farm stations operated by public or private
schools for educational purposes.

Where the words of a statute are clear, plain and free from ambiguity, it must be given its literal meaning and applied
without attempted interpretation. — The importance of the phrase “actually, directly, and exclusively used and found
to be necessary” cannot be understated, as what respondent DECS would want us to do by not taking the words in
their literal and technical definitions. The words of the law are clear and unambiguous. Thus, the “plain meaning
rule” or verba legis in statutory construction is applicable in this case. Where the words of a statute are clear, plain
and free from ambiguity, it must be given its literal meaning and applied without attempted interpretation.

FACTS:

Lot No. 2509 and Lot No. 817-D which were donated by the late Esteban Jalandoni to respondent DECS (formerly
Bureau of Education). Consequently, titles thereto were transferred in thename of respondent DECS .

Respondent DECS leased the lands to Anglo Agricultural Corporation for 10 agricultural crop years,commencing
from 1984-1994. The contract of lease was subsequently renewed for another agricultural crop years or until 2005.
On June 10, 1993, Eugenio Alpar and several others, claiming to be permanent and regular farm workers of the
subject lands, filed a petition for Compulsory Agrarian Reform Program (CARP) coverage with the Municipal
Agrarian Reform Office (MARO) of Escalante.

After investigation, MARO Jacinto R. Piñosa, sent a "Notice of Coverage" to respondent DECS, stating that the
subject lands are now covered by CARP and inviting its representatives for a conference with the farmer
beneficiaries. The recommendation for coverage was approved by DAR Regional Director

Dominador B. Andres approved the r, the dispositive portion of which reads: Respondent DECS appealed the case
to the Secretary of Agrarian Reform which affirmed the Order of the Regional Director. Respondent DECS filed a
petition for certiorari with the Court of Appeals, which set aside the decision of the Secretary of Agrarian Reform.
Hence, the instant petition for review.

ISSUE/S: Whether or not the subject properties are exempt from the coverage of Republic Act No. 6657, otherwise
known as the Comprehensive Agrarian Reform Law of 1998 (CARL).

RULING:

No. While respondent DECS sought exemption from CARP coverage on the ground that all the income derived
from its contract of lease with Anglo Agricultural Corporation were actually, directly and exclusively used for
educational purposes, such as for the repairs and renovations of schools in the nearby locality, the court is inclined
with the petitioner’s argument 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 Corporation. Further, to be exempt from the coverage, it is the land per se, not the income derived
therefrom, that must be actually, directly and exclusively used for educational purposes.
 Section 10 of R.A. No. 6657 enumerates the types of lands which are exempted from the coverage of CARP as
well as the purposes of their exemption specifying those “lands actually, directly and exclusively used and found to
be necessary for national defense, school sites and campuses, including experimental farm stations operated by
public or private schools for educational purposes, …, shall be exempt from the coverage of this Act.”

Clearly, a reading of the paragraph shows that, in order to be exempt from the coverage: 1) the land must be
"actually, directly, and exclusively used and found to be necessary;" and 2) the purpose is " for school sites and
campuses, including experimental farm stations operated by public or private schools for educational purposes."

21. Province of Camarines Sur v. CA

DOCTRINE/S:
The exclusive authority of the Department of Agrarian Reform to reclassify agricultural lands is limited to the
applications for reclassification submitted by the landowners or tenant beneficiaries and does not include the
determination of the “public purpose” requirement of the expropriating authority. — The rules on conversion of
agricultural lands found in Section 4 (k) and 5 (1) of Executive Order No. 129-A, Series of 1987, cannot be the
source of the authority of the Department of Agrarian Reform to determine the suitability of a parcel of agricultural
land for the purpose to which it would be devoted by the expropriating authority. While those rules vest on the
Department of Agrarian Reform the exclusive authority to approve or disapprove conversions of agricultural lands
for residential, commercial or industrial uses, such authority is limited to the applications for reclassification
submitted by the land owners or tenant beneficiaries.

Local government units can expropriate agricultural lands without prior authority from the Department of Agrarian
Reform as the determination of the public use of the property subject for expropriation is considered an expression
of legislative policy. — To sustain the Court of Appeals would mean that the local government units can no longer
expropriate agricultural lands needed for the construction of roads, bridges, schools, hospitals, etc, without first
applying for conversion of the use of the lands with the Department of Agrarian Reform, because all of these projects
would naturally involve a change in the land use. In effect, it would then be the Department of Agrarian Reform to
scrutinize whether the expropriation is for a public purpose or public use. Ordinarily, it is the legislative branch of
the local government unit that shall determine whether the use of the property sought to be expropriated shall be
public, the same being an expression of legislative policy.

FACTS:
Substantial Facts: In December 1988, the Sangguniang Panlalawigan of the Province of Camarines Sur passed
Resolution No. 129, Series of 1988, authorizing the Provincial Governor to purchase or expropriate property
contiguous to the provincial capitol site, in order to establish a pilot farm for non-food and non-traditional agricultural
crops and a housing project for provincial government employees. Pursuant to the Resolution, the Province of
Camarines Sur, filed expropriation cases against Ernesto San Joaquin and Efren San Joaquin in the RTC.

Procedural Facts: The trial court authorized the Province of Camarines Sur to take possession of the property. The
trial court issued a writ of possession. The Court of Appeals set aside the order of the trial court, allowing the
Province of Camarines Sur to take possession of private respondents' lands and the order denying the admission
of the amended motion to dismiss. It also ordered the trial court to suspend the expropriation proceedings until after
the Province of Camarines Sur shall have submitted the requisite approval of the Department of Agrarian Reform
to convert the classification of the property of the private respondents from agricultural to non-agricultural land.

ISSUE/S: WON local government unit is required secure approval from the Department of Agrarian Reform as a
condition precedent to institute the necessary expropriation proceedings.

RULING: NO. Resolution No. 129, Series of 1988, was promulgated pursuant to Section 9 of B.P. Blg. 337, the
Local Government Code, xxx Section 9 of B.P. Blg. 337 does not intimate in the least that local government units
must first secure the approval of the Department of Land Reform for the conversion of lands from agricultural to
non-agricultural use, before they can institute the necessary expropriation proceedings. Likewise, there is no
provision in the Comprehensive Agrarian Reform Law which expressly subjects the expropriation of agricultural
lands by local government units to the control of the Department of Agrarian Reform.
 FALLO: Petition is Granted

22. Samahan ng Magsasaka sa San Josep v. Valisno

DOCTRINE/S:
Right of Retention; The right of retention is a constitutionally guaranteed right which is subject to qualification by the
legislature. — As owners in their own right of the questioned properties, Redemptioner-Grandchildren enjoyed the
right of retention granted to all landowners. This right of retention is a constitutionally guaranteed right, which is
subject to qualification by the legislature. It serves to mitigate the effects of compulsory land acquisition by balancing
the rights of the landowner and the tenant and by implementing the doctrine that social justice was not meant to
perpetrate an injustice against the landowner. A retained area, as its name denotes, is land which is not supposed
to 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.

FACTS:

Substantive facts: The original 57-hectare property, situated in La Fuente, Sta. Rosa, Nueva Ecija, was formerly
registered in the name of Dr. Nicolas Valisno, Sr. Before the effectivity of Presidential Decree No. 27, the land was
the subject of a judicial ejectment suit, whereby in 1971, the Valisnos’ tenants were ejected from the property.
Among these tenants was Dominador Maglalang, who represents the SMSJ in the instant proceedings. Meanwhile,
Dr. Valisno mortgaged 12 hectares of his property to Renato and Angelito Banting. After the mortgage on the 12
hectare portion was foreclosed and the property sold at public auction, four grandchildren of Dr. Nicolas Valisno,
redeemed the same from the mortgagees.

Procedural facts: On appeal, the Office of the Regional Director issued an Order declaring the Valisno property
exempt from the coverage of PD 27 and RA 6657. This was reversed by then Secretary Garilao, who held that the
property is covered by the Comprehensive Agrarian Reform Program, subject to the retention rights of the heirs of
Nicolas, Sr. The Valisno heirs filed a motion for reconsideration of the said order, but the same was denied. The
Valisno heirs filed a motion for reconsideration of the said order, but the same was denied. The regional director
granted the application for retention of the heirs of Dr. Nicolas Valisno. On appeal, the DAR Secretary affirmed the
Order of the Regional Director. the Court of Appeals reversed the Orders of the DAR Secretary, granted the award
of one hectare each for the seven Grandchildren-Awardees, and affirmed the retention rights of the Redemptioner
Grandchildren over three hectares each, or a total of 12 hectares.

ISSUE/S: WON the grandchildren of the late Dr. Nicolas Valisno, Sr. are entitled to retention rights as landowners
under CARL.

RULING:

Yes. As owners in their own right of the questioned properties, Redemptioner-Grandchildren enjoyed the right of
retention granted to all landowners. This right of retention is a constitutionally guaranteed right, which is subject to
qualification by the legislature. It serves to mitigate the effects of compulsory land acquisition by balancing the rights
of the landowner and the tenant and by implementing the doctrine that social justice was not meant to perpetrate
an injustice against the landowner. A retained area, as its name denotes, is land which is not supposed to leave
the landowner’s dominion, thus sparing the government from the inconvenience of taking land only to return it to
the landowner afterwards, which would be a pointless process.

In the landmark case of Association of Small Landowners in the Philippines, Inc. v. Secretary of Agrarian
Reform, we held that landowners who have not yet exercised their retention rights under PD 27 are entitled
to the new retention rights under RA 6657.