CENTRAL MINDANAO UNIVERSITY REPRESENTED

PRESIDENT DR. LEONARDO A. CHUA, petitioner,

ITS

vs.
THE
DEPARTMENT
OF
AGRARIAN
REFORM
ADJUDICATION BOARD, THE COURT OF APPEALS and
ALVIN
OBRIQUE,
REPRESENTING BUKIDNON
FREE
FARMERS AGRICULTURAL LABORERS ORGANIZATION
(BUFFALO), respondents.
CAMPOS, JR., J.:
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 (DARAB for
brevity) dated September 4, 1989 and to set aside the decision
the decision * of the Court of Appeals dated August 20, 1990,
affirming the decision of the DARAB which ordered the
segregation of 400 hectares of suitable, compact and
contiguous portions of the Central Mindanao Universi ty (CMU
for brevity) land and their inclusion in the Comprehensive
Agrarian Reform Program (CARP for brevity) for distribution to
qualified beneficiaries, on the ground of lack of jurisdiction.
This case originated in a complaint filed by complainants call ing
themselves as the Bukidnon Free Farmers and Agricultural
Laborers Organization (BUFFALO for brevity) under the
leadership of Alvin Obrique and Luis Hermoso against the
CMU, before the Department of Agrarian Reform for Declaration
of Status as Tenants, under the CARP.
From the records, the following facts are evident. The petitioner,
the CMU, is an agricultural educational institution owned and
run by the state located in the town of Musuan, Bukidnon
province. It started as a farm school at Marilang, Bukidnon in
early 1910, in response to the public demand for an agricultural
school in Mindanao. It expanded into the Bukidnon National
Agricultural High School and was transferred to its new site in
Managok near Malaybalay, the provincial capital of Bukidnon .
In the early 1960's, it was converted into a college with campus
at Musuan, until it became what is now known as the CMU, but
still primarily an agricultural university. From its beginning, the
school was the answer to the crying need for training people in
order to develop the agricultural potential of the island of
Mindanao. Those who planned and established the school had
a vision as to the future development of that part of the
Philippines. On January 16, 1958 the President of the Republic
of the Philippines, the late Carlos P. Garcia, "upon the
recommendation of the Secretary of Agriculture and Natural
Resources, and pursuant to the provisions of Section 53, of
Commonwealth Act No. 141, as amended", issued
Proclamation No. 476, withdrawing from sale or settlement and
reserving for the Mindanao Agricultural College, a site which
would be the future campus of what is now the CMU. A total
land area comprising 3,080 hectares was surveyed and
registered and titled in the name of the petitioner under OCT
Nos. 160, 161 and 162. 1
In the course of the cadastral hearing of the school's petition for
registration of the aforementioned grant of agricultural land,
several tribes belonging to cultural communities, opposed the
petition claiming ownership of certain ancestral lands forming
part of the tribal reservations. Some of the claims were granted
so that what was titled to the present petitioner school was
reduced from 3,401 hectares to 3,080 hectares.
In the early 1960's, the student population of the school was
less than 3,000. By 1988, the student population had expanded
to some 13,000 students, so that the school community has an
academic population (student, faculty and non-academic staff)
of almost 15,000. To cope with the increase in its enrollment, it

has expanded and improved its educational facilities partly from

government appropriation and partly by self-help measures.
True to the concept of a land grant college, the school
embarked on self-help measures to carry out its educational
objectives, train its students, and maintain various activities
which the government appropriation could not adequately
support or sustain. 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. This
arrangement was covered by a written contract. Under this
program the faculty and staff combine themselves to groups of
five members each, and the CMU provided technical know-how,
practical training and all kinds of assistance, to enable each
group to cultivate 4 to 5 hectares of land for the lowland rice
project. Each group pays the CMU a service fee and also a land
use participant's fee. The contract prohibits participants and
their hired workers to establish houses or live in the project area
and to use the cultivated land as a collateral for any kind of
loan. It was expressly stipulated that no landlord -tenant
relationship existed between the CMU and the faculty and/or
employees. This particular program was conceived as a multidisciplinary applied research extension and productivity
program to utilize available land, train people in modern
agricultural technology and at the same time give the faculty
and staff opportunities within the confines of the CMU
reservation to earn additional income to augment their salaries.
The location of the CMU at Musuan, Bukidnon, which is quite a
distance from the nearest town, was the proper setting for the
adoption of such a program. Among the participants in this
program were Alvin Obrique, Felix Guinanao, Joven Caballero,
Nestor Pulao, Danilo Vasquez, Aronio Pelayo and other
complainants. Obrique was a Physics Instructor at the CMU
while the others were employees in the lowland rice project.
The other complainants who were not members of the faculty or
non-academic staff CMU, were hired workers or laborers of the
participants in this program. When petitioner Dr. Leonardo Chua
became President of the CMU in July 1986, he discontinued the
agri-business project for the production of rice, corn and sugar
cane known as 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.
As Assistant Director of this agri-business project, Obrique was
found guilty of mishandling the CMU funds and was separated
from service by virtue of Executive Order No. 17, the reorganization law of the CMU.
Sometime in 1986, under Dr. Chua as President, the CMU
launched a self-help project called CMU-Income Enhancement
Program (CMU-IEP) to develop unutilized land resources,
mobilize and promote the spirit of self-reliance, provide socioeconomic and technical training in actual field project
implementation and augment the income of the faculty and the
staff.
Under the terms of a 3-party Memorandum of Agreement 2
among the CMU, the CMU-Integrated Development Foundation
(CMU-IDF) and groups or "seldas" of 5 CMU employees, the
CMU would provide the use of 4 to 5 hectares of land to a selda
for one (1) calendar year. The CMU-IDF would provide
researchers and specialists to assist in the preparation of
project proposals and to monitor and analyze project
implementation. The selda in turn would pay to the CMU P100
as service fee and P1,000 per hectare as participant's land
rental fee. In addition, 400 kilograms of the produce per year
would be turned over or donated to the CMU-IDF. The
participants agreed not to allow their hired laborers or member
of their family to establish any house or live within vicinity of the
project area and not to use the allocated lot as collateral for a
loan. It was expressly provided that no tenant-landlord
relationship would exist as a result of the Agreement.

Initially, participation in the CMU-IEP was extended only to

workers and staff members who were still employed with the
CMU and was not made available to former workers or
employees. In the middle of 1987, to cushion the impact of the
discontinuance of the rice, corn and sugar cane project on the
lives of its former workers, the CMU allowed them to participate
in the CMU-IEP as special participants.
Under the terms of a contract called Addendum To Existing
Memorandum of Agreement Concerning Participation To the
CMU-Income Enhancement Program, 3 a former employee
would be grouped with an existing selda of his choice and
provided one (1) hectare for a lowland rice project for one (1)
calendar year. He would pay the land rental participant's fee of
P1,000.00 per hectare but on a charge-to-crop basis. He would
also be subject to the same prohibitions as those imposed on
the CMU employees. It was also expressly provided that no
tenant-landlord relationship would exist as a result of the
Agreement.
The one-year contracts expired on June 30, 1988. Some
contracts were renewed. Those whose contracts were not
renewed were served with notices to vacate.
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.
On the basis of the above facts, the DARAB found that the
private respondents were not tenants and cannot therefore be
beneficiaries under the CARP. At the same time, the DARAB
ordered the segregation of 400 hectares of suitable, compact
and contiguous portions of the CMU land and their inclusion in
the CARP for distribution to qualified beneficiaries.
The petitioner CMU, in seeking a review of the decisions of the
respondents DARAB and the Court of Appeals, raised the
following issues:
1.)
Whether or not the DARAB has jurisdiction to hear and
decide Case No. 005 for Declaration of Status of Tenants and
coverage of land under the CARP.
2.)
Whether or not respondent Court of Appeals
committed serious errors and grave abuse of discretion
amounting to lack of jurisdiction in dismissing the Petition for
Review on Certiorari and affirming the decision of DARAB.
In their complaint, docketed as DAR Case No. 5, filed with the
DARAB, complainants Obrique, et al. claimed that they are
tenants
of
the
CMU
and/or
landless
peasants
claiming/occupying a part or portion of the CMU situated at
Sinalayan, Valencia, Bukidnon and Musuan, Bukidnon,
consisting of about 1,200 hectares. 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. 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.
In the same paragraph of their complaint, complainants claim
that they are landless peasants. This allegation requires proof
and should not be accepted as factually true. 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.
The evidence on record establish without doubt that the
complainants were originally authorized or given permission to
occupy certain areas of the CMU property for a definite purpose
to carry out certain university projects as part of the CMU's
program of activities pursuant to its avowed purpose of giving
training and instruction in agricultural and other related
technologies, using the land and other resources of the
institution as a laboratory for these projects. Their entry into the
land of the CMU was with the permission and written consent of
the owner, the CMU, for a limited period and for a specific
purpose. After the expiration of their privilege to occupy and
cultivate the land of the CMU, their continued stay was
unauthorized and their settlement on the CMU's land was
without legal authority. A person entering upon lands of another,
not claiming in good faith the right to do so by virtue of any title
of his own, or by virtue of some agreement with the owner or
with one whom he believes holds title to the land, is a squatter.
4 Squatters cannot enter the land of another surreptitiously or
by stealth, and under the umbrella of the CARP, claim rights to
said property as landless peasants. Under Section 73 of R.A.
6657, persons guilty of committing prohibited acts of forcible
entry or illegal detainer do not qualify as beneficiaries and may
not avail themselves of the rights and benefits of agrarian
reform. Any such person who knowingly and wilfully violates the
above provision of the Act shall be punished with imprisonment
or fine at the discretion of the Court.
In view of the above, the private respondents, not being tenants
nor proven to be landless peasants, cannot qual ify as
beneficiaries under the CARP.
The questioned decision of the Adjudication Board, affirmed in
toto by the Court of Appeals, segregating 400 hectares from the
CMU land is primarily based on the alleged fact that the land
subject hereof is "not directly, actually and exclusively used for
school sites, because the same was leased to Philippine
Packing Corporation (now Del Monte Philippines)".
In support of this view, the Board held that the "respondent
University failed to show that it is using actually, really, truly and
in fact, the questioned area to the exclusion of others, nor did it
show that the same is directly used without any intervening
agency or person", 5 and "there is no definite and concrete
showing that the use of said lands are essentially indispensable
for educational purposes". 6 The reliance by the respondents
Board and Appellate Tribunal on the technical or literal definition
from Moreno's Philippine Law Dictionary and Black's Law
Dictionary, may give the ordinary reader a classroom meaning
of the phrase "is actually directly and exclusively", but in so
doing they missed the true meaning of Section 10, R.A. 6657,
as to what lands are exempted or excluded from the coverage
of the CARP.
The pertinent provisions of R.A. 6657, otherwise known as the
Comprehensive Agrarian Reform Law of 1988, are as follows:
Sec. 4. SCOPE. The Comprehensive Agrarian Reform Law
of 1988 shall cover, regardless of tenurial arrangement and
commodity produced, all public and private agricultural lands as
provided in Proclamation No. 131 and Executive Order No. 229
including other lands of the public domain suitable for
agriculture.

More specifically, the following lands are covered by the

Comprehensive Agrarian Reform Program:

develop and exploit its 3080-hectare land reservation as

follows: 8

(a)
All alienable and disposable lands of the public domain
devoted to or suitable for agriculture. No reclassification of
forest of mineral lands to agricultural lands shall be undertaken
after the approval of this Act until Congress, taking into account
ecological, developmental and equity considerations, shall have
determined by law, the specific limits of the public domain;

No. of Hectares

(b)
All lands of the public domain in excess of the specific
limits ad determined by Congress in the preceding paragraph;
(c)
All other lands owned by the Government devoted to
or suitable for agriculture; and
(d)
All private lands devoted to or suitable for agriculture
regardless of the agricultural products raised or that can be
raised thereon.
Sec. 10 EXEMPTIONS AND EXCLUSIONS. Lands actually,
directly and exclusively used and found to be necessary for
parks, wildlife, forest reserves, reforestration, fish sanctuaries
and breeding grounds, watersheds and mangroves, national
defense, school sites and campuses including experimental
farm stations operated by public or private schools for
educational purposes, seeds and seedlings research and pilot
production centers, church sites and convents appurtenant
thereto, mosque sites and Islamic centers appurtenant thereto,
communal burial grounds and cemeteries, penal colonie s and
penal farms actually worked by the inmates, government and
private research and quarantine centers and all lands with
eighteen percent (18%) slope and over, except those already
developed shall be exempt from the coverage of this Act.
(Emphasis supplied).
The construction given by the DARAB to Section 10 restricts the
land area of the CMU to its present needs or to a land area
presently, actively exploited and utilized by the university in
carrying out its present educational program with its present
student population and academic facility overlooking the very
significant factor of growth of the university in the years to
come. By the nature of the CMU, which is a school established
to promote agriculture and industry, the need for a vast tract of
agricultural land and for future programs of expansion is
obvious. At the outset, the CMU was conceived in the same
manner as land grant colleges in America, a type of educational
institution which blazed the trail for the development of vast
tracts of unexplored and undeveloped agricultural lands in the
Mid-West. What we now know as Michigan State University,
Penn State University and Illinois State University, started as
small land grant colleges, with meager funding to support their
ever increasing educational programs. They were given
extensive tracts of agricultural and forest lands to be developed
to support their numerous expanding activities in the fields of
agricultural technology and scientific research. Funds for the
support of the educational programs of land grant colleges
came from government appropriation, tuition and other student
fees, private endowments and gifts, and earnings from
miscellaneous sources. 7 It was in this same spirit that
President Garcia issued Proclamation No. 476, withdrawi ng
from sale or settlement and reserving for the Mindanao
Agricultural College (forerunner of the CMU) a land reservation
of 3,080 hectares as its future campus. It was set up in
Bukidnon, in the hinterlands of Mindanao, in order that it can
have enough resources and wide open spaces to grow as an
agricultural educational institution, to develop and train future
farmers of Mindanao and help attract settlers to that part of the
country.
In line with its avowed purpose as an agricultural and technical
school, the University adopted a land utilization program to

Percentage

a.

Livestock and Pasture

1,016.4033

b.

Upland Crops

20

c.

Campus and Residential sites

616

462

15

d.

Irrigated rice

e.

Watershed and forest reservation 308

10

f.

Fruit and Trees Crops

g.

Agricultural

Experimental stations

400.40 13

154

123.20 4

3,080.00100%
The first land use plan of the CARP was prepared in 1975 and
since then it has undergone several revisions in line with
changing economic conditions, national economic policies and
financial limitations and availability of resources. The CMU,
through Resolution No. 160 S. 1984, pursuant to its
development plan, adopted a multi-disciplinary applied research
extension and productivity program called the "Kilusang Sariling
Sikap Project" (CMU-KSSP). The objectives 9 of this program
were:
1.
Provide researches who shall assist in (a) preparation
of proposal; (b) monitor project implementation; and (c) collect
and analyze all data and information relevant to the processes
and results of project implementation;
2.
Provide the use of land within the University
reservation for the purpose of establishing a lowland rice project
for the party of the Second Part for a period of one calendar
year subject to discretionary renewal by the Party of the First
Part;

3.
Provide practical training to the Party of the Second
Part on the management and operation of their lowland project
upon request of Party of the Second Part; and
4.
Provide technical assistance in the form of relevant
livelihood project specialists who shall extend expertise on
scientific methods of crop production upon request by Party of
the Second Part.
In return for the technical assistance extended by the CMU, the
participants in a project pay a nominal amount as service fee.
The self-reliance program was adjunct to the CMU's lowland
rice project.
The portion of the CMU land leased to the Philippine Packing
Corporation (now Del Monte Phils., Inc.) was leased long before
the CARP was passed. The agreement with the Philippine
Packing Corporation was not a lease but a Management and
Development Agreement, a joint undertaking where use by the
Philippine Packing Corporation of the land was part of the CMU
research program, with the direct participation of faculty and
students. Said contracts with the Philippine Packing Corporation
and others of a similar nature (like MM-Agraplex) were made
prior to the enactment of R.A. 6657 and were directly connected
to the purpose and objectives of the CMU as an educational
institution. As soon as the objectives of the agreement for the
joint use of the CMU land were achieved as of June 1988, the
CMU adopted a blue print for the exclusive use and utilization of

said areas to carry out its own research and agricultural

experiments.

original jurisdiction over all matters including implementation of

Agrarian Reform.

As to the determination of when and what lands are found to be

necessary for use by the CMU, the school is in the best position
to resolve and answer the question and pass upon the problem
of its needs in relation to its avowed objectives for which the
land was given to it by the State. Neither the DARAB nor the
Court of Appeals has the right to substitute its judgment or
discretion on this matter, unless the evidentiary facts are so
manifest as to show that the CMU has no real for the land.

Section 50 of R.A. 6658 confers on the DAR quasi-judicial

powers as follows:

It is our opinion that the 400 hectares ordered segregated by

the DARAB and affirmed by the Court of Appeals in its Decision
dated August 20, 1990, is not covered by the CARP because:

(1)
It is not alienable and disposable land of the public
domain;
(2)
The CMU land reservation is not in excess of specific
limits as determined by Congress;
(3)
It is private land registered and titled in the name of its
lawful owner, the CMU;
(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. (Emphasis supplied).
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.
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. Despite the law and the evidence on record tending to
establish that the fact that the DARAB had no jurisdiction, it
made the adjudication now subject of review.
Whether the DARAB has the authority to order the segregation
of a portion of a private property titled in the name of its lawful
owner, even if the claimant is not entitled as a beneficiary, is an
issue we feel we must resolve. The quasi-judicial powers of
DARAB are provided in Executive Order No. 129-A, quoted
hereunder in so far as pertinent to the issue at bar:
Sec. 13. AGRARIAN REFORM ADJUDICATION BOARD
There is hereby created an Agrarian Reform Adjudication Board
under the office of the Secretary. . . . The Board shall assume
the powers and functions with respect to adjudication of
agrarian reform cases under Executive Order 229 and this
Executive Order . . .
Sec. 17. QUASI JUDICIAL POWERS OF THE DAR. The
DAR is hereby vested with quasi-judicial powers to determine
and adjudicate agrarian reform matters and shall have exclusive

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. . . .
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. An agrarian dispute is defined by
the same law as any controversy relating to tenurial rights
whether leasehold, tenancy stewardship or otherwise over
lands devoted to agriculture.
In the case at bar, the DARAB found that the complainants are
not share tenants or lease holders of the CMU, yet it ordered
the "segregation of a suitable compact and contiguous area of
Four Hundred hectares, more or less", from the CMU land
reservation, and directed the DAR Regional Director to
implement its order of segregation. Having found that the
complainants in this agrarian dispute for Declaration of Tenancy
Status are not entitled to claim as beneficiaries of the CARP
because they are not share tenants or leaseholders, its order
for the segregation of 400 hectares of the CMU land was
without legal authority. w do not believe that the quasi -judicial
function of the DARAB carries with it greater authority than
ordinary courts to make an award beyond what was demanded
by the complainants/petitioners, even in an agrarian dispute.
Where
the
quasi-judicial
body
finds
that
the
complainants/petitioners are not entitled to the rights they are
demanding, it is an erroneous interpretation of authority for that
quasi-judicial body to order private property to be awarded to
future beneficiaries. The order segregation 400 hectares of the
CMU land was issued on a finding that the complainants are not
entitled as beneficiaries, and on an erroneous assumption that
the CMU land which is excluded or exempted under the law is
subject to the coverage of the CARP. Going beyond what was
asked by the complainants who were not entitled to the relief
prayed the complainants who were not entitled to the relief
prayed for, constitutes a grave abuse of discretion because it
implies such capricious and whimsical exercise of judgment as
is equivalent to lack of jurisdiction.
The education of the youth and agrarian reform are admittedly
among the highest priorities in the government socio-economic
programs. In this case, neither need give way to the other.
Certainly, there must still be vast tracts of agricultural land in
Mindanao outside the CMU land reservation which can be
made available to landless peasants, assuming the claimants
here, or some of them, can qualify as CARP beneficiaries. To
our mind, the taking of the CMU land which had been
segregated for educational purposes for distribution to yet
uncertain beneficiaries is a gross misinterpretation of the
authority and jurisdiction granted by law to the DARAB.
The decision in this case is of far-reaching significance as far as
it concerns state colleges and universities whose resources and
research facilities may be gradually eroded by m isconstruing
the exemptions from the CARP. These state colleges and
universities are the main vehicles for our scientific and
technological advancement in the field of agriculture, so vital to
the existence, growth and development of this country.
It is the opinion of this Court, in the light of the foregoing
analysis and for the reasons indicated, that the evidence is
sufficient to sustain a finding of grave abuse of discretion by
respondents Court of Appeals and DAR Adjudication Board. We
hereby declare the decision of the DARAB dated September 4,

1989 and the decision of the Court of Appeals dated August 20,
1990, affirming the decision of the quasi-judicial body, as null
and void and hereby order that they be set aside, with costs
against the private res pondents.
SO ORDERED

CMU vs. DARAB

G.R. No. 100091

Facts:
On 16 Ja nuary 1958, Pres ident Carlos Garcia issued Proclamation No.
467 res erving for the Mi ndanao Agricultural College, now the CMU, a
pi ece of l a nd to be us ed a s i ts future ca mpus . In 1984, CMU
emba rked on a project titled "Ki lusang Sariling Sikap" wherein parcels
of l a nd were l eased to i ts faculty members a nd employees. Under the
terms of the program, CMU wi ll assist faculty members and employee
groups through the extension of technica l know-how, tra i ni ng a nd
other ki nds of assistance. In turn, they paid the CMU a s ervice fee for
us e of the land. The a greement explicitly provided that there wi l l be
no tena ncy rel a ti ons hi p between the l es s ees a nd the CMU.
When the progra m wa s termi na ted, a ca s e wa s fi l ed by the
pa rti cipants of the "Kilusang Sariling Sikap" for declarati on of s ta tus
a s tenants under the CARP. In its resolution, DARAB, ordered, a mong
others , the segregation of 400 hectares of the l a nd for di s tri buti on
under CARP. The land wa s s ubjected to covera ge on the ba s i s of
DAR's determination that the la nds do not meet the condi ti on for
exemption, that is, i t is not "a ctually, di rectly, a nd excl us i vel y us ed"
for educa ti ona l purpos es .

Is s ue:
Is the CMU l and covered by CARP? Who determines whether l a nds
res erved for public use by presi denti a l procl a ma ti on i s no l onger
a ctua lly, di rectly a nd exclusively used a nd necessary for the purpos e
for whi ch they a re res erved?

Hel d:
The l and i s exempted from CARP. CMU i s i n the bes t pos i ti on to
res olve a nd a nswer the question of when and what lands a re found
necessary for i ts use. The Court a lso chided the DARAB for res ol vi ng
thi s issue of exemption on the basis of "CMU's pres ent needs ." The
Court s ta ted that the DARAB decision stating that for the l a nd to be
exempt i t must be "presently, a ctively exploited a nd uti l i zed by the
uni versity i n carryi ng out i ts present educa ti ona l progra m wi th i ts
pres ent s tudent population and a ca demi c fa cul ty" overl ooked the
very s i gni fi ca nt fa ctor of growth of the uni vers i ty i n the yea rs to
come.

ATLAS FERTILIZER CORPORATION, petitioner,

vs.
THE HONORABLE SECRETARY OF THE DEPARTMENT OF
AGRARIAN REFORM, respondent.
G.R. No. 97855 June 19, 1997
PHILIPPINE FEDERATION OF FISHFARM PRODUCERS,
INC. petitioner,
vs.
THE HONORABLE SECRETARY OF THE DEPARTMENT OF
AGRARIAN REFORM, respondent.
RES OLUT I ON
ROMERO, J.:
Before this Court are consolidated petitions questioning the
constitutionality of some portions of Republic Act No. 6657
otherwise known as the Comprehensive Agrarian Reform Law.
1
Petitioners Atlas Fertilizer Corporation, 2 Philippine Federation
of Fishfarm Producers, Inc. and petitioner-in-intervention
Archie's Fishpond, Inc. and Arsenio Al. Acuna 3 are engaged in
the aquaculture industry utilizing fishponds and prawn farms.
They assail Sections 3 (b), 11, 13, 16 (d), 17 and 32 of R.A.
6657, as well as the implementing guidelines and procedures
contained in Administrative Order Nos. 8 and 10 Series of 1988
issued by public respondent Secretary of the Department of
Agrarian Reform as unconstitutional.
Petitioners claim that the questioned provisions of CARL violate
the Constitution in the following manner:
1.
Sections 3 (b), 11, 13, 16 (d), 17 and 32 of CARL
extend agrarian reform to aquaculture lands even as Section 4,
Article XIII of the Constitution limits agrarian reform only to
agricultural lands.
2.
The questioned provisions similarly treat of
aquaculture lands and agriculture lands when they are
differently situated, and differently treat aquaculture lands and
other industrial lands, when they are similarly situated in
violation of the constitutional guarantee of the equal protection
of the laws.
3.
The questioned provisions distort employment benefits
and burdens in favor of aquaculture employees and against
other industrial workers even as Section 1 and 3, Article XIII of
the Constitution mandate the State to promote equality in
economic and employment opportunities.
4.
The questioned provisions deprive petitioner of its
government-induced investments in aquaculture even as
Sections 2 and 3, Article XIII of the Constitution mandate the
State to respect the freedom of enterprise and the right of
enterprises to reasonable returns on investments and to
expansion and growth.
The constitutionality of the above-mentioned provisions has
been ruled upon in the case of Luz Farms, Inc. v. Secretary of
Agrarian Reform 4 regarding the inclusion of land devoted to
the raising of livestock, poultry and swine in its coverage.
The issue now before this Court is the constitutionality of the
same above-mentioned provisions insofar as they include in its
coverage lands devoted to the aquaculture industry, particularly
fishponds and prawn farms .
In their first argument , petitioners contend that in the case of
Luz Farms, Inc. v. Secretary of Agrarian Reform, 5 this Court

has already ruled impliedly that lands devoted to fishing are not
agricultural lands. In aquaculture, fishponds and prawn farm s,
the use of land is only incidental to and not the principal factor
in productivity and, hence, as held in "Luz Farms," they too
should be excluded from R.A. 6657 just as lands devoted to
livestock, swine, and poultry have been excluded for the same
reason. They also argue that they are entitled to the full benefit
of "Luz Farms" to the effect that only five percent of the total
investment in aquaculture activities, fishponds, and prawn
farms, is in the form of land, and therefore, cannot be classified
as agricultural activity. Further, that in fishponds and prawn
farms, there are no farmers, nor farm workers, who till lands,
and no agrarian unrest, and therefore, the constitutionally
intended beneficiaries under Section 4, Art. XIII, 1987
Constitution do not exist in aquaculture.
In their second argument, they contend that R.A. 6657, by
including in its coverage, the raising of fish and aquaculture
operations including fishponds and prawn ponds, treating them
as in the same class or classification as agriculture or farming
violates the equal protection clause of the Constitution and is,
therefore, void. Further, the Constitutional Commission debates
show that the intent of the constitutional framers is to exclude
"industrial" lands, to which category lands devoted to
aquaculture, fishponds, and fish farms belong.
Petitioners also claim that Administrative Order Nos. 8 and 10
issued by the Secretary of the Department of Agrarian Reform
are, likewise, unconstitutional, as held in "Luz Farms," and are
therefore void as they implement the assailed provisions of
CARL.
The provisions of CARL being assailed as unconstitutional are
as follows:
(a)
Section 3 (b) which includes the "raising of fish in the
definition of "Agricultural, Agricultural Enterprise or Agricultural
Activity." (Emphasis Supplied)
(b)
Section 11 which defines "commercial farms" as
private agricultural lands devoted to fishponds and prawn
ponds. . . . (Emphasis Supplied)
(c)
Section 13 which calls upon petitioner to execute a
production-sharing plan.
(d)
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.
(e)
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 at
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, determines a
lower ceiling.
In the event that the individual or entity realizes a profit, an
additional ten percent (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. . . .
While the Court will not hesitate to declare a law or an act void
when confronted squarely with constitutional issues, neither will
it preempt the Legislative and the Executive branches of the
government in correcting or clarifying, by means of amendment,
said law or act. On February 20, 1995, Republic Act No. 7881 6

was approved by Congress. Provisions of said Act pertinent to

the assailed provisions of CARL are the following:
Sec. 1. Section 3, Paragraph (b) of Republic Act No. 6657 is
hereby amended to read as follows:
Sec. 3. Definitions. For the purpose of this Act, unless the
context indicates otherwise:
(b)
Agriculture, Agricultural Enterprise or Agricultural
Activity means the cultivation of the soil, planting of crops,
growing of fruit trees, including the harvesting of such farm
products and other farm activities and practices performed by a
farmer in conjunction with such farming operations done by
persons whether natural or juridical.
Sec. 2. Section 10 of Republic Act No. 6657 is hereby
amended to read as follows:
Sec. 10. Exemptions and Exclusions.
xxx

xxx

xxx

b)
Private lands actually, directly and exclusively used for
prawn farms and fishponds shall be exempt from the coverage
of this Act: Provided, That said prawn farms and fishponds have
not been distributed and Certificate of Land Ownership Award
(CLOA) issued to agrarian reform beneficiaries under the
Comprehensive Agrarian Reform Program.

their net profit before tax from the operation of the fishpon d or
prawn farms are distributed within sixty (60) days at the end of
the fiscal year as compensation to regular and other pond
workers in such ponds over and above the compensation they
currently receive.
In order to safeguard the right of the regular fis hpond or prawn
farm workers under the incentive plan, the books of the
fishpond or prawn owners shall be subject to periodic audit or
inspection by certified public accountants chosen by the
workers.
The foregoing provision shall not apply to agricultural lands
subsequently converted to fishponds or prawn farms provided
the size of the land converted does not exceed the retention
limit of the landowner.
The above-mentioned provisions of R.A. No. 7881 expressly
state that fishponds and prawn farms are excluded from the
coverage of CARL. In view of the foregoing, the question
concerning the constitutionality of the assailed provisions has
become moot and academic with the passage of R.A. No. 7881.
WHEREFORE, the petition is hereby DISMISSED.
SO ORDERED.
CASE DIGEST #6: ATLAS VS AGRA
Facts:

In cases where the fishponds or prawn farms have been

subjected to the Comprehensive Agrarian Reform Law, by
voluntary offer to sell, or commercial farms deferment or notices
of compulsory acquisition, a simple and absolute majority of the
actual regular workers or tenants must consent to the
exemption within one (1) year from the effectivity of this Act.
when the workers or tenants do not agree to this exemption, the
fishponds or prawn farms shall be distributed collectively to the
worker beneficiaries or tenants who shall form a cooperative
or association to manage the same.
In cases where the fishponds or prawn farms have not been
subjected to the Comprehensive Agrarian Reform Law, the
consent of the farm workers shall no longer be necessary,
however, the provision of Section 32-A hereof on incentives
shall apply.
xxx

xxx

xxx

Sec. 3. Section 11, Paragraph 1 is hereby amended to read as

follows:
Sec. 11. Commercial Farming. Commercial farms, which are
private agricultural lands devoted to saltbeds, fruit farms,
orchards, vegetable and cut-flower farms and cacao, coffee and
rubber plantations, shall be subject to immediate compulsory
acquisition and distribution after ten (10) years from the
effectivity of this Act. In the case of new farms, the ten-year
period shall begin from the first year of commercial production
and operation, as determined by the DAR. During the ten -year
period, the Government shall initiate steps necessary to acquire
these lands, upon payment of just compensation for the land
and the improvements thereon, preferably in favor of organized
cooperatives or associations, which shall thereafter manage the
said lands for the workers beneficiaries.
Sec. 4. There shall be incorporated after Section 32 of
Republic Act No. 6657 a section to read as follows
Sec. 32-A.
Incentives. Individuals or entities owning or
operating fishponds and prawn farms are hereby mandated to
execute within six (6) months from the effectivity of this Act, an
incentive plan with their regular fishpond or prawn farm workers'
organization, if any, whereby seven point five percent (7.5%) of

Before this Court are consolidated petitions questioning the

constitutionality of some portions of Republic Act No. 6657
otherwise known as the Comprehensive Agrarian Reform Law.
Petitioners Atlas Fertilizer Corporation, Philippine Federation of
Fishfarm Producers, Inc. and petitioner-in-intervention Archie's
Fishpond, Inc. and Arsenio Al. Acuna are engaged in the
aquaculture industry utilizing fishponds and prawn farms. They
assail Sections 3 (b), 11, 13, 16 (d), 17 and 32 of R.A. 6657, as
well as the implementing guidelines and procedures contained
in Administrative Order Nos. 8 and 10 Series of 1988 issued by
public respondent Secretary of the Department of Agrarian
Reform as unconstitutional.

Petitioners claim that the questioned provisions of CARL violate

the Constitution in the following manner:
1. Sections 3 (b), 11, 13, 16 (d), 17 and 32 of CARL extend
agrarian reform to aquaculture lands even as Section 4, Article
XIII of the Constitution limits agrarian reform only to agricultural
lands.
2. The questioned provisions similarly treat of aquaculture lands
and agriculture lands when they are differently situated, and
differently treat aquaculture lands and other industrial lands,
when they are similarly situated in violation of the constitutional
guarantee of the equal protection of the laws.
3. The questioned provisions distort employment benefits and
burdens in favor of aquaculture employees and against other
industrial workers even as Section 1 and 3, Article XIII of the
Constitution mandate the State to promote equality in economic
and employment opportunities.
4. The questioned provisions deprive petitioner of its
government-induced investments in aquaculture even as
Sections 2 and 3, Article XIII of the Constitution mandate the
State to respect the freedom of enterprise and the right of
enterprises to reasonable returns on investments and to
expansion and growth.

The constitutionality of the above-mentioned provisions has

been ruled upon in the case of Luz Farms, Inc. v.Secretary of
Agrarian Reform regarding the inclusion of land devoted to the
raising of livestock, poultry and swine in its coverage.
The issue now before this Court is the constitutionality of the
same above-mentioned provisions insofar as they include in its
coverage lands devoted to the aquaculture industry, particularly
fishponds and prawn farms.
Issue:

Whether or not Sections 3 (b), 11, 13, 16 (d), 17 and 32

of R.A. 6657, as well as the implementing guidelines and
procedures contained in Administrative Order Nos. 8 and 10
Series of 1988 issued by public respondent Secretary of the
Department of Agrarian Reform are unconstitutional.

Held:
No, the contested provisions of R.A. 6657 and of A.O. Nos. 8
and 10 are not unconstitutional. The Suprem e Court has
already ruled impliedly that lands devoted to fishing are not
agricultural lands. In aquaculture, fishponds and prawn farms,
the use of land is only incidental to and not the principal factor
in productivity and, hence, as held in "Luz Farms," they too
should be excluded from R.A. 6657 just as lands devoted to
livestock, swine, and poultry have been excluded for the same
reason.
When the case was pending, RA 7881 was approved by
Congress amending RA 6657. Provisions of R.A. No. 7881
expressly state that fishponds and prawn are excluded from the
coverage of CARL.
Thus, the petition was dismissed by the Supreme Court.
HELD:
PETITIONERs contention

First argument: that in the case of Luz Farms, Inc. v. Secretary of

Agrarian Reform, this Court has already ruled impliedly that lands
devoted to fishing are not agriculture lands, for the use of land is only
incidental to and not the principal factor in productivity and, hence,
should be excluded from R.A. 6657.

Second argument: that R.A. 6657, by including fishponds and praw n

ponds in the same classification as agriculture violates the equal
protection clause of the Constitution and is, therefore, void. the intent
of the consti framers is to exclude industrial lands, to w hich category
lands devoted to aquaculture, fishponds, and fish farms
belong.Administrative Order Nos. 8 and 10 issued by the Secretary of
the Department of Agrarian Reform are, likew ise, unconstitutional, as
held in Luz Farms, and are therefore void as they implement the
assailed provisions of CARL.
Further, that in fishponds and praw n farms, there are no farmers,
nor farm w orkers, who till lands, and no agrarian unrest, and therefore,
the constitutionally intended beneficiaries under Section 4, Art. XIII,
1987 Constitution do not exist in aquaculture.

COURTs deci s i on
The question concerning the constitutionality of the assailed provisions
has been rendered moot and academic because RA 7881, approved by
congress on February 20, 1995, expressly states that fishponds &
praw n farms are excluded from the coverage of CARL.
The court will not hesitate to declare law or an act void when confronted
with constitutional issues, neither will it preempt the Legislative &
Executive branches of the government in correcting or clarifying, by
means of amendment said law or act.

[G.R. No. 86889 : December 4, 1990.]

192 SCRA 51

On December 22, 1989, the Solicitor General adopted his

Comment to the petition as his Memorandum (Rollo, pp. 186 187).

LUZ FARMS, Petitioner, vs. THE HONORABLE SECRETARY

OF
THE
DEPARTMENT
OF
AGRARIAN
REFORM,
Respondent.

Luz Farms questions the following provisions of R.A. 6657,

insofar as they are made to apply to it:

DECISION

(a) Section 3(b) which includes the "raising of livestock (and

poultry)" in the definition of "Agricultural, Agricultural Enterprise
or Agricultural Activity."

PARAS, J.:
This is a petition for prohibition with prayer for restraining order
and/or preliminary and permanent injunction against the
Honorable Secretary of the Department of Agrarian Reform for
acting without jurisdiction in enforcing the assailed provisions of
R.A. No. 6657, otherwise known as the Comprehensive
Agrarian Reform Law of 1988 and in promulgating the
Guidelines and Procedure Implementing Production and Profit
Sharing under R.A. No. 6657, insofar as the same apply to
herein petitioner, and further from performing an act in violation
of the constitutional rights of the petitioner.
As gathered from the records, the factual background of this
case, is as follows:
On June 10, 1988, the President of the Philippines approved
R.A. No. 6657, which includes the raising of livestock, poultry
and swine in its coverage (Rollo, p. 80).
On January 2, 1989, the Secretary of Agrarian Reform
promulgated the Guidelines and Procedures Implementing
Production and Profit Sharing as embodied in Sections 13 and
32 of R.A. No. 6657 (Rollo, p. 80).
On January 9, 1989, the Secretary of Agrarian Reform
promulgated its Rules and Regulations implementing Section
11 of R.A. No. 6657 (Commercial Farms). (Rollo, p. 81).
Luz Farms, petitioner in this case, is a corporation engaged in
the livestock and poultry business and together with others in
the same business allegedly 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
otherwise known as Comprehensive Agrarian Reform Law and
of the Guidelines and Procedures Implementing Production and
Profit Sharing under R.A. No. 6657 promulgated on January 2,
1989 and the Rules and Regulations Implementing Section 11
thereof as promulgated by the DAR on January 9, 1989 (Rollo,
pp. 2-36).: rd
Hence, this petition praying that aforesaid laws, 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.
This Court in its Resolution dated July 4, 1939 resolved to deny,
among others, Luz Farms' prayer for the issuance of a
preliminary injunction in its Manifestation dated May 26, and 31,
1989. (Rollo, p. 98).
Later, however, this Court in its Resolution dated August 24,
1989 resolved to grant said Motion for Reconsideration
regarding the injunctive relief, after the filing and approval by
this Court of an injunction bond in the amount of P100,000.00.
This Court also gave due course to the petition and required the
parties to file their respective memoranda (Rollo, p. 119).
The petitioner filed its Memorandum on September 6, 1989
(Rollo, pp. 131-168).

(b) Section 11 which defines "commercial farms" as "private

agricultural lands devoted to commercial, livestock, poultry and
swine raising . . ."
(c) Section 13 which calls upon petitioner to execute a
production-sharing plan.

(d) 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.
(e) 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 dis tributed
to said regular and other farmworkers within ninety (90) days of
the end of the fiscal year . . ."
The main issue in this petition is the constitutionality of Sections
3(b), 11, 13 and 32 of R.A. No. 6657 (the Comprehensive
Agrarian Reform Law of 1988), insofar as the said law includes
the raising of livestock, poultry and swine in its coverage as well
as the Implementing Rules and Guidelines promulgated in
accordance therewith.:-cralaw
The constitutional provision under consideration reads as
follows:
ARTICLE XIII
x x x
AGRARIAN AND NATURAL RESOURCES REFORM
Section 4. The State shall, by law, undertake an agrarian reform
program founded on the right of farmers and regular
farmworkers, who are landless, to own directly or collectively
the lands they till or, in the case of other farmworkers, to receive
a just share of the fruits thereof. To this end, the State shall
encourage and undertake the just distribution of all agricultural
lands, subject to such priorities and reasonable retention limits
as the Congress may prescribe, taking into account ecological,
developmental, or equity considerations, and subject to the
payment of just compensation. In determining retention limits,
the State shall respect the rights of small landowners. The State
shall further provide incentives for voluntary land-sharing.
x x x"
Luz Farms contended that it does not seek the nullification of
R.A. 6657 in its entirety. In fact, it acknowledges the

correctness of the decision of this Court in the case of the

Association of Small Landowners in the Philippines, Inc. vs.
Secretary of Agrarian Reform (G.R. 78742, 14 July 1989)
affirming the constitutionality of the Comprehensive Agrarian
Reform Law. It, however, 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 (Rollo, p. 131). 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. Indeed, there are many owners of residential
lands all over the country who use available space in their
residence for commercial livestock and raising purposes, under
"contract-growing
arrangements," whereby processing
corporations and other commercial livestock and poultry raisers
(Rollo, p. 10). 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 (Rollo, p. 11).
On the other hand, the 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." (Rollo, pp. 82-83).

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 (Record, CONCOM,
August 7, 1986, Vol. III, p. 11).
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". This proposal, however,
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 (Record, CONCOM, August 7, 1986, Vol. III, p.
30).
In the interpellation, then Commissioner Regalado (now a
Supreme Court Justice), posed several questions, among
others, quoted as follows:
x x x
"Line 19 refers to genuine reform program founded on the
primary right of farmers and farmworkers. I wonder if it means
that leasehold tenancy is thereby proscribed under this
provision because it speaks of the primary right of farmers and
farmworkers to own directly or collectively the lands they till. As
also mentioned by Commissioner Tadeo, farmworkers include
those who work in piggeries and poultry projects.
I was wondering whether I am wrong in my appreciation that if
somebody puts up a piggery or a poultry project and for that
purpose hires farmworkers therein, these farmworkers will
automatically have the right to own eventually, directly or
ultimately or collectively, the land on which the piggeries and
poultry projects were constructed. (Record, CONCOM, August
2, 1986, p. 618).

The petition is impressed with merit.

x x x
The question raised is one of constitutional construction. The
primary task in constitutional construction is to ascertain and
thereafter assure the realization of the purpose of the framers in
the adoption of the Constitution (J.M. Tuazon & Co. vs. Land
Tenure Administration, 31 SCRA 413 [1970]).: rd
Ascertainment of the meaning of the provision of Constitution
begins with the language of the document itself. The words
used in the Constitution are to be given their ordinary meaning
except where technical terms are employed in which case the
significance thus attached to them prevails (J.M. Tuazon & Co.
vs. Land Tenure Administration, 31 SCRA 413 [1970]).
It is generally held that, in construing constitutional provisions
which are ambiguous or of doubtful meaning, the courts may
consider the debates in the constitutional convention as
throwing light on the intent of the framers of the Constitution. It
is true that the intent of the convention is not controlling by
itself, but as its proceeding was preliminary to the adoption by
the people of the Constitution the understanding of the
convention as to what was meant by the terms of the
constitutional provision which was the subject of the
deliberation, goes a long way toward explaining the
understanding of the people when they ratified it (Aquino, Jr. v.
Enrile, 59 SCRA 183 [1974]).
The transcripts of the deliberations of the Constitutional
Commission of 1986 on the meaning of the word "agricultu ral,"

The questions were answered and explained in the statement of

then Commissioner Tadeo, quoted as follows:
x x x

"Sa pangalawang katanungan ng Ginoo ay medyo hindi kami

nagkaunawaan. Ipinaaalam ko kay Commissioner Regalado n a
hindi namin inilagay ang agricultural worker sa kadahilanang
kasama rito ang piggery, poultry at livestock workers. Ang
inilagay namin dito ay farm worker kaya hindi kasama ang
piggery, poultry at livestock workers (Record, CONCOM,
August 2, 1986, Vol. II, p. 621).
It is evident from the foregoing discussion that Section II of R.A.
6657 which includes "private agricultural lands devoted to
commercial livestock, poultry and swine raising" in the definition
of "commercial farms" is invalid, to the extent that the aforecited
agro-industrial activities are made to be covered by the agrarian
reform program of the State. There is simply no reason to
include livestock and poultry lands in the coverage of agrarian
reform. (Rollo, p. 21).
Hence, there is merit in Luz Farms' argument that the
requirement in Sections 13 and 32 of R.A. 6657 directing
"corporate farms" which include livestock and poultry raisers to

execute and implement "production-sharing plans" (pending

final redistribution of their landholdings) whereby they are called
upon to distribute from three percent (3%) of their gross sales
and ten percent (10%) of their net profits to their workers as
additional compensation is unreasonable for being confiscatory,
and therefore violative of due process (Rollo, p. 21).:-cralaw
It has been established that this Court will assume jurisdiction
over a constitutional question only if it is shown that the
essential requisites of a judicial inquiry into such a question are
first satisfied. Thus, there must be an actual case or controversy
involving a conflict of legal rights susceptible of judicial
determination, the constitutional question must have been
opportunely raised by the proper party, and the resolution of the
question is unavoidably necessary to the decision of the case
itself (Association of Small Landowners of the Philippines, Inc.
v. Secretary of Agrarian Reform, G.R. 78742; Acuna v. Arroyo,
G.R. 79310; Pabico v. Juico, G.R. 79744; Manaay v. Juico,
G.R. 79777, 14 July 1989, 175 SCRA 343).
However, despite the inhibitions pressing upon the Court when
confronted with constitutional issues, it will not hesitate to
declare a law or act invalid when it is convinced that this must
be done. In arriving at this conclusion, its only criterion will be
the Constitution and God as its conscience gives it in the light to
probe its meaning and discover its purpose. Personal motives
and political considerations are irrelevancies that cannot
influence its decisions. Blandishment is as ineffectual as
intimidation, for all the awesome power of the Congress and
Executive, the Court will not hesitate "to make the hammer fall
heavily," where the acts of these departments, or of any official,
betray the people's will as expressed in the Constitution
(Association of Small Landowners of the Philippines, Inc. v.
Secretary of Agrarian Reform, G.R. 78742; Acuna v. Arroyo,
G.R. 79310; Pabico v. Juico, G.R. 79744; Manaay v. Juico,
G.R. 79777, 14 July 1989).
Thus, where the legislature or the executive acts beyond the
scope of its constitutional powers, it becomes the duty of the
judiciary to declare what the other branches of the government
had assumed to do, as void. This is the essence of judicial
power conferred by the Constitution "(I)n one Supreme Court
and in such lower courts as may be established by law" (Art.
VIII, Section 1 of the 1935 Constitution; Article X, Section I of
the 1973 Constitution and which was adopted as part of the
Freedom Constitution, and Article VIII, Section 1 of the 1987
Constitution) and which power this Court has exercised in many
instances (Demetria v. Alba, 148 SCRA 208 [1987]).
PREMISES CONSIDERED, the instant petition is hereby
GRANTED. Sections 3(b), 11, 13 and 32 of R.A. No. 6657
insofar as the inclusion of the raising of livestock, poultry and
swine in its coverage as well as the Implementing Rules and
Guidelines promulgated in accordance therewith, are hereby
DECLARED null and void for being unconstitutional and the writ
of preliminary injunction issued is hereby MADE permanent.
SO ORDERED.

Ponente:
Facts:
This is a petition for prohibition with prayer for restraining order
and/or preliminary and permanent injunction against the
Honorable Secretary of the Department of Agrarian Reform for
acting without jurisdiction in enforcing the assailed provisions of
R.A. No. 6657, otherwise known as the Comprehensive
Agrarian Reform Law of 1988 and in promulgating the
Guidelines and Procedure Implementing Production and Profit
Sharing under R.A. No. 6657, insofar as the same apply to
herein petitioner, and further from performing an act in violation
of the constitutional rights of the petitioner. On June 10,1988,
the President of the Philippines approved R.A. No. 6657, which
includes the raising of livestock, poultry and swine in its
coverage (Rollo, p. 80). On January 2, 1989, the Secretary of
Agrarian Reform promulgated the Guidelines and Procedures
Implementing Production and Profit Sharing as embodied in
Sections 13 and 32 of R.A. No. 6657 (Rollo, p. 80). On January
9, 1989, the Secretary of Agrarian Reform promulgated its
Rules and Regulations implementing Section 11 of R.A. No.
6657. Luz Farms, petitioner in this case, is a corp oration
engaged in the livestock and poultry business and together with
others in the same business allegedly 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
otherwise known as Comprehensive Agrarian Reform Law and
of the Guidelines and Procedures Implementing Production and
Profit Sharing under R.A. No. 6657 promulgated on January
2,1989 and the Rules and Regulations Implementing Section 11
thereof as promulgated by the DAR on January 9,1989.
Issue:
Whether or not the Sections 3(b), 11, 13 and 32 of R.A. No.
6657 (the Comprehensive Agrarian Reform Law of 1988) is
constitutional.
Hel d:
Sec. 3 (b) a nd Sec. 11 of RA 6657 a re unconstitutional i n so far as they
i ncl ude l ands devoted to ra ising livestock, s wine a nd poultry within its
covera ge. The use of land i s incidental to but not the principal factor
or cons ideration of productivity i n this industry.
The Supreme Court held that:
The tra nscripts of deliberations of the Constitutional Commission of
1986 on the meaning of the word "agricultural," cl early s how that it
wa s never the intention of the framers of the Constitution to i nclude
l i vestock a nd poultry i ndustry i n the coverage of the constitutionallyma ndated agrarian reform program of the government.
The Commi ttee adopted the definition of "agricultural land" as
defi ned under Section 166 of RA 3844, a s land devoted to any
growth, i ncluding but not limited to crop l ands, saltbeds, fishponds,
i dl e and abandoned land (Record, CONCOM, August 7, 1986, Vol . III,
p. 11).

CASE DIGEST #7
Luz Farms (petitioner) vs. Secretary of the Department of
Agrarian Reform (respondent) G.R. No. 86889. December 4,
1990

The Supreme Court noted that the i ntention of the Committee to

l i mit the application of the word "agriculture" is further s hown by the
proposal of Commissioner Jamir to i nsert the wo rd "a rable" to
di s tinguish this kind of a gricultural land from such lands a s
commercial a nd i ndustrial lands a nd residential properties. The
proposal, however, was not considered because the Committee
contemplated that a gricultural l ands are limited to a rable and
s ui table agricultural lands a nd therefore, do not i nclude commercial,
i ndustrial and residential lands (Record, CONCOM, 7 Augus t 1986,
Vol . III, p. 30).

Moreover, i n his answer to Commissioner Regalado's interpellation,

Commi ssioner Ta deo clarified that the term "farmworker" was used
i ns tead of "agricultural worker" in order to exclude therein piggery,
poul try a nd l ivestock workers (Record, CONCOM, Augus t 2, 1986, Vol.
II, p. 621).

In their Answer, the defendants denied the allegations and

disclaimed any control and supervision over its security
personnel. Defendant SRRDC also alleged that as the real
owner of the property, it was the one that suffered damages due
to the encroachment on the property.[6]

SPECIAL FIRST DIVISION

[G.R. No. 112526. March 16, 2005]

A writ of preliminary injunction was issued by the trial court on

August 17, 1987,[7] but this was subsequently dissolved by the
Court of Appeals (CA) on April 22, 1988 in its deci sion in CAG.R. SP No. 13908.[8]

STA. ROSA REALTY DEVELOPMENT CORPORATION,

petitioner, vs. JUAN B. AMANTE, FRANCISCO L. ANDAL
etc respondents.

After trial on the merits, the trial court, on January 20, 1992,
rendered a decision ordering Amante, et al. to vacate the
property, the dispositive portion of which reads:

[G.R. No. 118838. March 16, 2005]

WHEREFORE, premises considered, judgment is hereby

rendered in favor of the defendants and against the plaintiffs
hereby dismissing the complaint and amended complaint.

JUAN B. AMANTE, IGNACIO PETATE, DOMINGO CANUBAS,

FLORENCIO
CANUBAS, CRESENCIO AMANTE,
etc
respondents.
AM ENDEDDE CIS IO N

The plaintiffs are hereby ordered to vacate the parcels of land

belonging to the defendants Luis Yulo and Sta. Rosa Realty.
They are likewise enjoined from entering the subject parcels of
land.

AUSTRIA-MARTINEZ, J.:
By virtue of the En Banc Resolution issued on January 13,
2004, the Court authorized the Special First Division to suspend
the Rules so as to allow it to consider and resolve the second
Motion for Reconsideration of respondents,[1] after the motion
was heard on oral arguments on August 13, 2003. On July 9,
2004,[2] the Court resolved to submit for resolution the second
Motion for Reconsideration in G.R. No. 112526 together with
G.R. No. 118338 in view of the Resolution of the Court dated
January 15, 2001 issued in G.R. No. 118838,[3] consolidating
the latter case with G.R. No. 112526, the issues therein being
interrelated.[4] Hence, the herein Amended Decision.
The factual background of the two cases is as follows:
The Canlubang Estate in Laguna is a vast landholding
previously titled in the name of the late Speaker and Chief
Justice Jose Yulo, Sr. Within this estate are two parcels of land
(hereinafter referred to as the subject property) covered by TCT
Nos. 81949 and 84891 measuring 254.766 hectares and part of
Barangay Casile, subsequently titled in the name of Sta. Rosa
Realty Development Corporation (SRRDC), the majority
stockholder of which is C.J. Yulo and Sons, Inc.
The subject property was involved in civil suits and
administrative proceedings that led to the filing of G.R. Nos.
112526 and 118838, thus:
Injunction Case Filed by Amante, et al.
On December 6, 1985, Amante, et al., who are the private
respondents in G.R. No. 112526 and petitioners in G.R. No.
118838, instituted an action for injunction with damages in the
Regional Trial Court of Laguna (Branch 24) against Luis Yulo,
SRRDC, and several SRRDC security personnel, docketed as
Civil Case No. B-2333. Amante, et al. alleged that: they are
residents of Barangay Casile, Cabuyao, Laguna, which covers
an area of around 300 hectares; in 1910, their ancestors started
occupying the area, built their houses and planted fruit-bearing
trees thereon, and since then, have been peacefully occupying
the land; some time in June 3, 1985, SRRDCs security people
illegally entered Bgy. Casile and fenced the area; SRRDCs men
also entered the barangay on November 4, 1985, cut down the
trees, burned their huts, and barred the lone jeepney from
entering the Canlubang Sugar Estate; as a result of these acts,
Amante, et al. were deprived of possession and cultivation of
their lands. Thus, they claimed damages, sought the issuance
of permanent injunction and proposed that a right of way be
declared.[5]

Although attorneys fees and expenses of litigation are

recoverable in case of a clearly unfounded civil action against
the plaintiff (Enervida vs. De la Torre, 55 SCRA 339), this Court
resolves not to award attorneys fees etc. in favor of the
defendants because the plaintiffs appear to have acted in good
faith in filing the present civil action (Salao vs. Salao, 70 SCRA
65) and that it would not be just and equitable to award the
same in the case at bar. (Liwanag vs. Court of Appeals, 121
SCRA 354) Accordingly, the other reliefs prayed for by the
defendants are hereby dismissed.
SO ORDERED.[9]
Amante, et al. appealed the aforesaid decision to the CA,
docketed as CA-G.R. CV No. 38182.
On June 28, 1994, the CA affirmed with modification the
decision of the trial court in the injunction case. The dispositive
portion of the appellate courts decision[10] reads as follows:
WHEREFORE, the judgment herein appealed from is hereby
AFFIRMED, with the modification that the defendants -appellees
are hereby ordered, jointly and severally, to pay the plaintiffs appellants nominal damages in the amount of P5,000.00 per
plaintiff. No pronouncement as to costs.
SO ORDERED.[11]
Nominal damages were awarded by the CA because it found
that SRRDC violated Amante, et al.s rights as possessors of the
subject property.[12]
Amante, et al. filed a motion for reconsideration thereof,
pointing out the DARABs decision placing the property under
compulsory acquisition, and the CA decision in CA-G.R. SP No.
27234, affirming the same.[13] The CA, however, denied the
motion, with the modification that only SRRDC and the
defendants-security guards should be held jointly and severally
liable for the nominal damages awarded. It also made the
clarification that the decision should not preempt any judgment
or prejudice the right of any party in the agrarian reform case
pending before the Supreme Court (G.R. No. 112526).[14]
Thus, Amante, et al. filed on March 2, 1995, herein petition,
docketed as G.R. No. 118838 on the following grounds:
4.1. THE COURT OF APPEALS DECIDED THE CASE
CONTRARY TO LAW OR APPLICABLE SUPREME COURT
DECISIONS BECAUSE:

4.1.1 FIRST, PETITIONERS MAY NOT BE LAWFULLY

EVICTED FROM THEIR LANDHOLDINGS CONSIDERING
THAT:

reconsideration from the Court of Appeals dismissal, h ence, it

became final and executory.[21]
Administrative Proceedings

-- (A) PETITIONERS ARE ALREADY THE REGISTERED

OWNERS UNDER THE TORRENS SYSTEM OF THE
PROPERTIES IN QUESTION SINCE FEBRUARY 26, 1992 BY
VIRTUE OF RA 6657 OR THE COMPREHENSIVE AGRARIAN
REFORM LAW;
-- (B) THE COURT OF APPEALS HAS AFFIRMED THE
REGIONAL TRIAL COURT OF LAGUNAS DISMISSAL OF THE
EJECTMENT CASES FILED BY RESPONDENT SRRDC
AGAINST PETITIONERS; AND
-- (C) ASSUMING FOR THE SAKE OF ARGUMENT ONLY
THAT PETITIONERS ARE NOT YET THE REGISTERED
OWNERS
OF
THE
PROPERTIES
IN
QUESTION,
RESPONDENTS MAY NOT RAISE THE ISSUE OF
OWNERSHIP IN THIS CASE FOR INJUNCTION WITH
DAMAGES, THE SAME TO BE VENTILATED IN A SEPARATE
ACTION, NOT IN THIS CASE BROUGHT TO PREVENT
RESPONDENTS FROM COMMITTING FURTHER ACTS OF
DISPOSSESSION [BACAR V. DEL ROSARIO ET AL., 171
SCRA 451 (1989)].

4.1.2 SECOND, PETITIONERS ARE ENTITLED TO MORAL,

EXEMPLARY DAMAGES AND ATTORNEYS FEES, INSTEAD
OF MERE NOMINAL DAMAGES, CONSIDERING THAT THE
COURT OF APPEALS FOUND RESPONDENTS TO HAVE
UNLAWFULLY AND ILLEGALLY DISTURBED PETITIONERS
PEACEFUL AND CONTINUOUS POSSESSION.[15]

While the injunction and ejectment cases were still in process, it

appears that in August, 1989, the Municipal Agrarian Reform
Office (MARO) issued a Notice of Coverage to SRRDC,
informing petitioners that the property covered by TCT Nos. T81949, T-84891 and T-92014 is scheduled for compulsory
acquisition under the Comprehensive Agrarian Reform Program
(CARP).[22] SRRDC filed its Protest and Objection with the
MARO on the grounds that the area was not appropriate for
agricultural purposes, as it was rugged in terrain with slopes of
18% and above, and that the occupants of the land were
squatters, who were not entitled to any land as
beneficiaries.[23] Thereafter, as narrated in the Decision of the
Court dated October 12, 2001 in G.R. No. 112526, the following
proceedings ensued:
On August 29, 1989, the farmer beneficiaries together with the
BARC chairman answered the protest and objection stating that
the slope of the land is not 18% but only 5-10% and that the
land is suitable and economically viable for agricultural
purposes, as evidenced by the Certification of the Department
of Agriculture, municipality of Cabuyao, Laguna.
On September 8, 1989, MARO Belen dela Torre made a
summary investigation report and forwarded the Compulsory
Acquisition Folder Indorsement (CAFI) to the Provincial
Agrarian Reform Officer (hereafter, PARO).
On September 21, 1989, PARO Durante Ubeda forwarded his
endorsement of the compulsory acquisition to the Secretary of
Agrarian Reform.

Ejectment Cases Filed by SRRDC

Between October 1986 and August 1987, after the injunction
case was filed by Amante, et al., SRRDC filed with the
Municipal Trial Court (MTC) of Cabuyao, Laguna, several
complaints for forcible entry with preliminary injunction and
damages against Amante, et al., docketed as Civil Cases Nos.
250, 258, 260, 262 and 266. SRRDC alleged that some time in
July 1987, they learned that Amante, et al., without their
authority and through stealth and strategy, were clearing,
cultivating and planting on the subject property; and that despite
requests from SRRDCs counsel, Amante, et al. refused to
vacate the property, prompting them to file the ejectment
cases.[16] Amante, et al. denied that SRRDC are the absolute
owners of the property, stating that they have been in peaceful
possession thereof, through their predecessors -in-interest,
since 1910.[17]
On May 24, 1991, the MTC-Cabuyao rendered its decision in
favor of SRRDC. Amante, et al. were ordered to surrender
possession and vacate the subject property. The decision was
appealed to the Regional Trial Court of Bian, Laguna (Assisting
Court).
On February 18, 1992, the RTC dismissed the ejectment cases
on the ground that the subject property is an agricultural land
being tilled by Amante, et al., hence it is the Department of
Agrarian Reform (DAR), which has jurisdiction over the
dispute.[18] The RTCs dismissal of the complaints was brought
to the CA via a petition for review, docketed as CA-G.R. SP No.
33382.[19] In turn, the CA dismissed the petition per its
Decision dated January 17, 1995 on the ground that SRRDC
failed to show any prior physical possession of the subject
property that would have justified the filing of the ejectment
cases.[20] Also, the CA did not sustain the RTCs finding that
the subject properties are agricultural lands and Amante, et al.
are tenant/farmers thereof, as the evidence on record does not
support such finding. The parties did not file any motion for

On November 23, 1989, Acting Director Eduardo C. Visperas of

the Bureau of Land Acquisition and Development, DAR
forwarded two (2) Compulsory Acquisition Claim Folders
covering the landholding of SRRDC, covered by TCT Nos. T81949 and T-84891 to the President, Land Bank of the
Philippines for further review and evaluation.
On December 12, 1989, Secretary of Agrarian Reform Miriam
Defensor Santiago sent two (2) notices of acquisition to
petitioner, stating that petitioners landholdings covered by TCT
Nos. T-81949 and T-84891, containing an area of 188.2858 and
58.5800 hectares, valued at P4,417,735.65 and P1,220,229.93,
respectively, had been placed under the Comprehensive
Agrarian Reform Program.
On February 6, 1990, petitioner SRRDC in two letters
separately addressed to Secretary Florencio B. Abad and the
Director, Bureau of Land Acquisition and Distribution, sent its
formal protest, protesting not only the amount of compensation
offered by DAR for the property but also the two (2) noti ces of
acquisition.
On March 17, 1990, Secretary Abad referred the case to the
DARAB for summary proceedings to determine just
compensation under R.A. No. 6657, Section 16.
On March 23, 1990, the LBP returned the two (2) claim folders
previously referred for review and evaluation to the Director of
BLAD mentioning its inability to value the SRRDC landholding
due to some deficiencies.
On March 28, 1990, Executive Director Emmanuel S. Galvez
wrote the Land Bank President Deogracias Vistan to forward
the two (2) claim folders involving the property of SRRDC to the
DARAB for it to conduct summary proceedings to determine the
just compensation for the land.

On April 6, 1990, petitioner sent a letter to the Land Bank of the

Philippines stating that its property under the aforesaid land
titles were exempt from CARP coverage because they had
been classified as watershed area and were the subject of a
pending petition for land conversion.
On May 10, 1990, Director Narciso Villapando of BLAD turned
over the two (2) claim folders (CACFs) to the Executive Director
of the DAR Adjudication Board for proper administrative
valuation. Acting on the CACFs, on September 10, 1990, the
Board promulgated a resolution asking the office of the
Secretary of Agrarian Reform (DAR) to first resolve two (2)
issues before it proceeds with the summary land valuation
proceedings.
The issues that need to be threshed out were as follows: (1)
whether the subject parcels of land fall within the coverage of
the Compulsory Acquisition Program of the CARP; and (2)
whether the petition for land conversion of the parcels of land
may be granted.
On December 7, 1990, the Office of the Secretary, DAR,
through the Undersecretary for Operations (Assistant Secretary
for Luzon Operations) and the Regional Director of Region IV,
submitted a report answering the two issues raised. According
to them, firstly, by virtue of the issuance of the notice of
coverage on August 11, 1989, and notice of acquisition on
December 12, 1989, the property is covered under compulsory
acquisition. Secondly, Administrative Order No. 1, Series of
1990, Section IV D also supports the DAR position on the
coverage of the said property. During the consideration of the
case by the Board, there was no pending petition for land
conversion s pecifically concerning the parcels of land in
question.
On February 19, 1991, the Board sent a notice of hearing to all
the parties interested, setting the hearing for the administrative
valuation of the subject parcels of land on March 6, 1991.
However, on February 22, 1991, Atty. Ma. Elena P. HernandezCueva, counsel for SRRDC, wrote the Board requesting for its
assistance in the reconstruction of the records of the case
because the records could not be found as her co-counsel, Atty.
Ricardo Blancaflor, who originally handled the case for SRRDC
and had possession of all the records of the case was on
indefinite leave and could not be contacted. The Board granted
counsels request and moved the hearing on April 4, 1991.

On December 19, 1991, the DARAB promulgated a decision,

affirming the dismissal of the protest of SRRDC against the
compulsory coverage of the property covered by TCT Nos.
81949 and 84891. The decretal portion of the decision reads:
WHEREFORE, based on the foregoing premises, the Board
hereby orders:
1. The dismissal for lack of merit of the protest against the
compulsory coverage of the landholdings of Sta. Rosa Realty
Development Corporation (Transfer Certificates of Title Nos.
81949 and 84891 with an area of 254.766 hectares) in
Barangay Casile, Municipality of Cabuyao, Province of Laguna
under the Comprehensive Agrarian Reform Program is hereby
affirmed;
2. The Land Bank of the Philippines (LBP) to pay Sta. Rosa
Realty Development Corporation the amount of Seven Million
Eight Hundred Forty-One Thousand, Nine Hundred Ninety
Seven Pesos and Sixty-Four centavos (P7,841,997.64) for its
landholdings covered by the two (2) Transfer Certificates of Title
mentioned above. Should there be a rejection of the payment
tendered, to open, if none has yet been made, a trust account
for said amount in the name of Sta. Rosa Realty Development
Corporation;
3. The Register of Deeds of the Province of Laguna to cancel
with dispatch Transfer Certificate of Title Nos. 84891 and 81949
and new one be issued in the name of the Republic of the
Philippines, free from liens and encumbrances;
4. The Department of Environment and Natural Resources
either through its Provincial Office in Laguna or the Regional
Office, Region IV, to conduct a final segregation survey on the
lands covered by Transfer Certificate of Title Nos . 84891 and
81949 so the same can be transferred by the Register of Deeds
to the name of the Republic of the Philippines;
5. The Regional Office of the Department of Agrarian Reform
through its Municipal and Provincial Agrarian Reform Office to
take immediate possession on the said landholding after Title
shall have been transferred to the name of the Republic of the
Philippines, and distribute the same to the immediate issuance
of Emancipation Patents to the farmer-beneficiaries as
determined by the Municipal Agrarian Reform Office of
Cabuyao, Laguna.[25]

On March 18, 1991, SRRDC submitted a petition to the Board

for the latter to resolve SRRDCs petition for exemption from
CARP coverage before any administrative valuation of their
landholding could be had by the Board.

On July 11, 1991, DAR Secretary Benjamin T. Leong issued a

memorandum directing the Land Bank of the Philippines (LBP)
to open a trust account in favor of SRRDC, for P5,637,965.55,
as valuation for the SRRDC property.

On April 4, 1991, the initial DARAB hearing of the case was

held and subsequently, different dates of hearing were set
without objection from counsel of SRRDC. During the April 15,
1991 hearing, the subdivision plan of subject property at Casile,
Cabuyao, Laguna was submitted and marked as Exhibit 5 for
SRRDC. At the hearing on April 23, 1991, the Land Bank asked
for a period of one month to value the land in dispute.

The titles in the name of SRRDC were cancelled and

corresponding TCTs were issued in the name of the Republic of
the Philippines on February 11, 1992,[26] after which
Certificates of Land Ownership Award (CLOA) were issued in
the name of the farmers-beneficiaries on February 26, 1992.[27]

At the hearing on April 23, 1991, certification from Deputy

Zoning Administrator Generoso B. Opina was presented. The
certification issued on September 8, 1989, stated that the
parcels of land subject of the case were classified as Industrial
Park per Sangguniang Bayan Resolution No. 45-89 dated
March 29, 1989.
To avert any opportunity that the DARAB might distribute the
lands to the farmer beneficiaries, on April 30, 1991, petitioner
filed a petition with DARAB to disqualify private respondents as
beneficiaries. However, DARAB refused to address the issue of
beneficiaries.[24]
. ..

In the meantime, SRRDC had filed with the CA a petition for

review of the DARABs decision, docketed as CA-G.R. SP No.
27234.
On November 5, 1993, the CA affirmed the decision of DARAB,
to wit:
WHEREFORE, premises considered, the DARAB decision
dated December 19, 1991 is AFFIRMED, without prejudice to
petitioner Sta. Rosa Realty Development Corporation ventilating
its case with the Special Agrarian Court on the issue of just
compensation.[28]
Hence, SRRDC filed on November 24, 1993, herein petition,
docketed as G.R. No. 112526 on the following grounds:

I
THE COURT OF APPEALS COMMITTED A GRAVE ABUSE
OF DISCRETION TANTAMOUNT TO LACK OR EXCESS OF
ITS JURISDICTION IN RULING THAT THE SRRDC
PROPERTIES, DESPITE THE UNDISPUTED FACT OF THEIR
NON-AGRICULTURAL CLASSIFICATION PRIOR TO RA 6657,
ARE COVERED BY THE CARP CONTRARY TO THE
NATALIA REALTY DECISION OF THIS HONORABLE COURT.
i. The SRRDC properties have been zoned and approved as
PARK since 1979.
ii. The SRRDC properties form part of a watershed area.
II
THE COURT OF APPEALS COMMITTED A GRAVE ABUSE
OF DISCRETION TANTAMOUNT TO LACK OR EXCESS OF
ITS JURISDICTION IN DISREGARDING ECOLOGICAL
CONSIDERATIONS AS MANDATED BY LAW.
III
THE COURT OF APPEALS COMMITTED A GRAVE ABUSE
OF DISCRETION TANTAMOUNT TO LACK OR EXCESS OF
ITS JURISDICTION IN AFFIRMING THE DISTRIBUTION OF
THE SRRDC PROPERTIES TO PRIVATE RESPONDENTS
WHO HAVE BEEN JUDICIALLY DECLARED AS SQUATTERS
AND THEREFORE ARE NOT QUALIFIED BENEFICIARIES
PURSUANT TO THE CENTRAL MINDANAO UNIVERSITY
DECISION OF THIS HONORABLE COURT.
i. The acquisition of the SRRDC properties cannot be valid for
future beneficiaries.
ii. Section 22 of RA 6657 insofar as it expands the coverage of
the CARP to landless residents is unconstitutional.
IV
THE COURT OF APPEALS COMMITTED A GRAVE ABUSE
OF DISCRETION TANTAMOUNT TO LACK OR EXCESS OF
ITS JURISDICTION IN HOLDING THAT THE DARAB HAS
JURISDICTION TO PASS UPON THE ISSUE OF WHETHER
THE SRRDC PROPERTIES ARE SUBJECT TO CARP
COVERAGE.[29]
On October 12, 2001, the Court rendered its Decision in G.R.
No. 112526 only, setting aside the decision of the CA in CAG.R. SP No. 27234 and ordering the remand of the case to the
DARAB for re-evaluation and determination of the nature of the
land. The dispositive portion of the Decision reads as follows:
IN VIEW WHEREOF, the Court SETS ASIDE the decision of
the Court of Appeals in CA-G.R. SP No. 27234.
In lieu thereof, the Court REMANDS the case to the DARAB for
re-evaluation and determination of the nature of the parcels of
land involved to resolve the issue of its coverage by the
Comprehensive Land Reform Program.
In the meantime, the effects of the CLOAs issued by the DAR to
supposed farmer beneficiaries shall continue to be stayed by
the temporary restraining order issued on December 15, 1993,
which shall remain in effect until final decision on the case.
No costs.
SO ORDERED.[30]
It is the opinion of the Court in G.R. No. 112526, that the
property is part of a watershed, and that during the hearing at
the DARAB, there was proof that the land may be excluded
from the coverage of the CARP because of its high slopes.[31]

Thus, the Court concluded that a remand of the case to the

DARAB for re-evaluation of the issue of coverage is appropriate
in order to resolve the true nature of the subject property.[32]
In their Memorandum, Amante, et al. argues that there exist
compelling reasons to grant the second motion for
reconsideration of the assailed decision of the Court, to wit:
2.1 Only QUESTIONS OF LAW are admittedly and undeniably
at issue; yet the Honorable Court reviewed the findings of facts
of the Court of Appeals and the DARAB although the case does
not fall into any of the well-recognized exceptions to conduct a
factual review. Worse, the 12 October 2001 Decision as sumed
facts not proven before any administrative, quasi-judicial or
judicial bodies;
2.2 The DARAB and the Court of Appeals already found the
land to be CARPable; yet the Honorable Court remanded the
case to DARAB to re-evaluate if the land is CARPable;
2.3 The Decision did not express clearly and distinctly the facts
and the law on which
it is based;
2.4 The Decision renewed the Temporary Restraining Order
issued on 15 December 1993, issuance of which is barred by
Sec. 55 of R.A. 6657; and
2.5 This Honorable Court denied private respondents Motion for
Reconsideration although issues raised therein were never
passed upon in the 12 October 2001 Decision or elsewhere.[33]
The DAR and the DARAB, through the Office of the Solicitor
General, did not interpose any objection to the second motion
for reconsideration. It also maintained that if SRRDCs claim that
the property is watershed is true, then it is the DENR that
should exercise control and supervision in the disposition,
utilization, management, renewal and conservation of the
property.[34]
SRRDC meanwhile insists that there are no compelling reasons
to give due course to the second motion for reconsideration.[35]
At the outset, the Court notes that petitioner designated its
petition in G.R. No. 112526 as one for review on certiorari of the
decision of the CA. In the same breath, it likewise averred that it
was also being filed as a special civil action for certiorari as
public respondents committed grave abuse of discretion.[36]
Petitioner should not have been allowed, in the first place, to
pursue such remedies simultaneously as these are mutually
exclusive.[37]
It is SRRDCs claim that the CA committed grave abuse of
discretion in holding that the subject property is agricultural in
nature. In support of its contention, it argued, among others,
that the subject property had already been classified as park
since 1979 under the Zoning Ordinance of Cabuyao, as
approved by the Housing and Land Use Regulatory Board
(HLURB); that it forms part of a watershed; and that the CA
disregarded ecological considerations.[38] SRRDC also claimed
that Amante, et al. are not qualified beneficiaries.[39]
Clearly, these issues are factual in nature, which the Court, as a
rule, should not have considered in this case. However, there
are recognized exceptions, e.g., when the factual inferences of
the appellate court are manifestly mistaken; the judgment is
based on a misapprehension of facts; or the CA manifestly
overlooked certain relevant and undisputed facts that, if
properly considered, would justify a different legal
conclusion.[40] The present cases fall under the above
exceptions.

Thus, in order to finally set these cases to rest, the Court shall
resolve the substantive matters raised, which in effect comes
down to the issue of the validity of the acquisition of the subject
property by the Government under Republic Act (R.A.) No.
6657, or the Comprehensive Agrarian Reform Law of 1988
(CARL).
As noted earlier, the DARAB made its finding regarding the
nature of the property in question, i.e., the parcels of land are
agricultural and may be the subject of compulsory acquisition
for distribution to farmer-beneficiaries, thus:
Ocular inspections conducted by the Board show that the
subject landholdings have been under the possession a nd
tillage of the DAR identified potential beneficiaries which they
inherited from their forebears (workers of the Yulo Estate). They
are bonafide residents and registered voters (DARAB Exhibits
C and J) of Barangay Casile, Cabuyao, Laguna. There is a
barangay road leading toward the barangay school and sites
and the settlement has a barangay hall, church, elementary
school buildings (DARAB Exhibit Q), Comelec precincts
(DARAB Exhibits J-1 and J-2), and other structures extant in
progressive communities. The barangay progressive
development agencies, like the DECS, DA, COMELEC, DAR
and Support Services of Land Bank, DPWH, DTI and the
Cooperative Development Authority have extended support
services to the community (DARAB Exhibits I, K to K-3, L, M, N,
O, P to P-6). More importantly, subject landholdings are suitable
for agriculture. Their topography is flat to undulating 3 -15%
slope. (Testimony of Rosalina Jumaquio, Agricultural Engineer,
DAR, TSN, June 21, 1991, DARAB Exhibits F and H). Though
some portions are over 18% slope, nevertheless, clearly visible
thereat are fruit-bearing trees, like coconut, coffee, and
pineapple plantations, etc. (see Petitioners Exhibits A to YYY
and DARAB Exhibits A to S, Records). In other words, they are
already productive and fully developed.
. ..
As the landholdings of SRRDC subject of the instant
proceedings are already developed not only as a community but
also as an agricultural farm capable of sustaining daily
existence and growth, We find no infirmity in placing said
parcels of land under compulsory coverage. They do not belong
to the exempt class of lands. The claim that the landholding of
SRRDC is a watershed; hence, belonging to the exempt class
of lands is literally throwing punches at the moon because the
DENR certified that the only declared watershed in Laguna
Province and San Pablo City is the Caliraya-Lumot Rivers
(Petitioners Exhibit A). A sensu contrario, the landholdings
subject herein are not.[41] (Emphasis supplied)
The evidence on record supports these findings, to wit:
1. Certification dated January 16, 1989 by the OIC Provincial
Environment and Natural Resources Office of Laguna that the
only declared watershed in the Laguna province and San Pablo
City is the Caliraya-Lumot Rivers No. 1570 dated September 1,
1976;[42]
2. Map prepared by Agricultural Engineer Rosalina H. Jumaquio
showing that: a) the topography of the property covered by TCT
No. T-84891 topography is flat to undulating with a 5 to 10%
slope; (b) it is suitable to agricultural crops; and (c) the land is
presently planted with diversified crops;[43]
3. Certification dated August 28, 1989 by APT Felicito Buban of
the Department of Agriculture of Laguna that, per his ocular
inspection, the subject property is an agricultural area, and that
the inhabitants main occupation is farming;[44]
4. Pictures taken by MARO Belen La Torre of Cabuyao,
Laguna, showing that the property is cultivated and inhabited by
the farmer-beneficiaries;[45]

SRRDC however, insists that the property has already been

classified as a municipal park and beyond the scope of CARP.
To prove this, SRRDC submitted the following:
1. Certification dated March 1, 1991 by the Municipality of
Cabuyao, Laguna that the entire barangay of Casile is
delineated as Municipal Park;[46]
2. Certification dated March 11, 1991 by the Housing and Land
Use Regulatory Board that the parcels of land located in
Barangay Casile are within the Municipal Park, based on the
municipalitys approved General Land Use Plan ratified by the
Housing and Land Use Regulatory Board as per Resolution No.
38-2 dated June 25, 1980;[47]

3. Photocopies of pictures taken by Mr. Ernesto Garcia, Officerin-Charge of the Special Project Section of CJ Yulo and Sons,
Inc., of portions of Barangay Casile;[48]
The Court recognizes the power of a local government to
reclassify and convert lands through local ordinance, especially
if said ordinance is approved by the HLURB.[49] Municipal
Ordinance No. 110-54 dated November 3, 1979, enacted by the
Municipality of Cabuyao, divided the municipality into
residential, commercial, industrial, agricultural and institutional
districts, and districts and parks for open spaces.[50] It did not
convert, however, existing agricultural lands into residential,
commercial, industrial, or institutional. While it classified
Barangay Casile into a municipal park, as shown in its permitted
uses of land map, the ordinance did not provide for the
retroactivity of its classification. In Co vs. Intermediate Appellate
Court,[51] it was held that an ordinance converting agricultural
lands into residential or light industrial should be given
prospective application only, and should not change the nature
of existing agricultural lands in the area or the legal
relationships existing over such lands. Thus, it was stated:
A reading of Metro Manila Zoning Ordinance No. 81-01, series
of 1981, does not disclose any provision converting existing
agricultural lands in the covered area into residential or light
industrial. While it declared that after the passage of the
measure, the subject area shall be used only for residential or
light industrial purposes, it is not provided therein that it shall
have retroactive effect so as to discontinue all rights previously
acquired over lands located within the zone which are neither
residential nor light industrial in nature. This simply means that,
if we apply the general rule, as we must, the ordinance should
be given prospective operation only. The further implication is
that it should not change the nature of existing agricultural lands
in the area or the legal relationships existing over such lands
[52] (Emphasis supplied)
Under Section 3 (c) of R.A. No. 6657, agricultural land is
defined as land devoted to agricultural activity and not classified
as mineral, forest, residential, commercial or industrial land.
Section 3 (b) meanwhile defines agricultural activity as the
cultivation of the soil, planting of crops, growing of fruit trees,
raising of livestock, poultry or fish, including the harvesting of
such products, and other farm activities, and practices
performed by a farmer in conjunction with such farming
operations done by persons whether natural or juridical.
Before Barangay Casile was classified into a municipal park by
the local government of Cabuyao, Laguna in November 1979, it
was part of a vast property popularly known as the Canlubang
Sugar Estate. SRRDC claimed that in May 1979, the late Miguel
Yulo allowed the employees of the Yulo group of companies to
cultivate a maximum area of one hectare each subject to the
condition that they should not plant crops being grown by the
Canlubang Sugar Estate, like coconuts and coffee, to avoid
confusion as to ownership of crops.[53] The consolidation and
subdivision plan surveyed for SRRDC on March 10-15,

1984[54] also show that the subject property is sugar land.

Evidently, the subject property is already agricultural at the time
the municipality of Cabuyao enacted the zoning ordinance, and
such ordinance should not affect the nature of the land. More so
since the municipality of Cabuyao did not even take any step to
utilize the property as a park.
SRRDC cites the case of Natalia Realty, Inc. vs. DAR,[55]
wherein it was ruled that lands not devoted to agricultural
activity and not classified as mineral or forest by the DENR and
its predecessor agencies, and not classified in town plans and
zoning ordinances as approved by the HLURB and its
preceding competent authorities prior to the enactment of R.A.
No. 6657 on June 15, 1988, are outside the coverage of the
CARP. Said ruling, however, finds no application in the present
case. As previously stated, Municipal Ordinance No. 110 -54 of
the Municipality of Cabuyao did not provide for any retroactive
application nor did it convert existing agricultural lands into
residential,
commercial,
industrial,
or
institutional.
Consequently, the subject property remains agricultural in
nature and therefore within the coverage of the CARP.
Only on March 9, 2004, SRRDC filed with the Court a
Manifestation pointing out DAR Order No. (E)4-03-507-309
dated February 17, 2004, exempting from CARP coverage two
parcels of land owned by SRRDC and covered by TCT Nos. T85573 and T-92014.[56] The DAR found that these properties
have been re-classified into Municipal Parks by the Municipal
Ordinance of Cabuyao, Laguna, and are part of the KabangaanCasile watershed, as certified by the DENR.[57]
The Court notes however that the said DAR Order has
absolutely no bearing on these cases. The herein subject
property is covered by TCT Nos. 81949 and 34891, totally
different, although adjacent, from the property referred to in said
DAR Order.
SRRDC also contends that the property has an 18% slope and
over and therefore exempt from acquisition and distribution
under Section 10 of R.A. No. 6657. What SRRDC opted to
ignore is that Section 10, as implemented by DAR
Administrative Order No. 13 dated August 30, 1990, also
provides that those with 18% slope and over but already
developed for agricultural purposes as of June 15, 1988, may
be allocated to qualified occupants.[58] Hence, even assuming
that the property has an 18% slope and above, since it is
already developed for agricultural purposes, then it cannot be
exempt from acquisition and distribution. Moreover, the
topography maps prepared by Agricultural Engineer Rosalina H.
Jumaquio show that the property to be acquired has a 5 -10%
flat to undulating scope;[59] that it is suitable to agricultural
crops;[60] and it is in fact already planted with diversified crops.
Also, the Certification dated July 1, 1991 by Geodetic Engine er
Conrado R. Rigor that the top portion of Barangay Casile has a
0 to 18% slope while the side of the hill has a 19 to 75%
slope,[62] was presented by SRRDC only during the
proceedings before the CA which had no probative value in a
petition for review proceedings. The Court notes that SRRDC
had been given ample time and opportunity by the DARAB to
prove the grounds for its protest and objection but miserably
failed to take advantage of such time and opportunity[63] in the
DARAB proceedings.
SRRDC also contends that the property is part of a watershed,
citing as evidence, the Certification dated June 26, 1991 by the
Laguna Lake Development Authority that Barangay Casile is
part of the watershed area of the Laguna Lake Basin,[64] and
the Final Report for Watershed Area Assessment Study for the
Canlubang Estate dated July 1991 undertaken by the
Engineering & Development Corporation of the Philippines.[65]
It must be noted, however, that these pieces of evidence were
likewise brought to record only when petitioner filed its petition

for review with the CA. The DARAB never had the opportunity
to assess these pieces of evidence.
The DARAB stated:
Noting the absence of evidence which, in the nature of things,
should have been submitted by landowner SRRDC and to avo id
any claim of deprivation of its right to prove its claim to just
compensation (Uy v. Genato, 57 SCRA 123). We practically
directed its counsel in not only one instance, during the series
of hearings conducted, to do so. We even granted continuances
to give it enough time to prepare and be ready with the proof
and documents. To Our dismay, none was submitted and this
constrained Us to take the failure/refusal of SRRDC to present
evidence as a waiver or, at least, an implied acceptance of the
valuation made by the DAR.
The same goes with the CA, which did not have the discretion
to consider evidence in a petition for certiorari or petition for
review on certiorari outside than that submitted before the
DARAB. The CA noted petitioners failure to present evidence in
behalf of its arguments, thus:
. . . It must be recalled that petitioner Sta. Rosa Realty itself had
asked the DARAB in a petition dated March 18, 1991 to allow it
to adduce evidence in support of its position that the subject
parcels of land are not covered by the CARP beginning on the
scheduled hearing dated April 4, 1991. And DARAB obliged as
in fact the petitioner commenced to introduce evidence. If
petitioner failed to complete the presentation of evidence to
support its claim of exemption from CARP coverage, it has only
itself to blame for which DARAB cannot be accused of not being
impartial.
Consequently, there is no need to order the remand of the case
to the DARAB for re-evaluation and determination of the nature
of the parcels of land involved. It runs contrary to orderly
administration of justice and would give petitioner undue
opportunity to present evidence in support of its stance, an
opportunity it already had during the DARAB proceedings, and
which opportunity it regrettably failed to take advantage of.
More significantly however, it is the DAR Secretary that
originally declared the subject property as falling under the
coverage of the CARP.
Moreover, DAR Administrative Order No. 13, Series of 1990
(Rules and Procedure Governing Exemption of Lands from
CARP Coverage under Section 10, R.A. No. 6657) provides:
I. LEGAL MANDATE
The general policy under CARP is to cover as much lands
suitable for agriculture as possible. However, Section 10, RA
6657 excludes and exempts certain types of lands from the
coverage of CARP, to wit:
A. Lands actually, directly and exclusively used and found to be
necessary for parks, wildlife, forest reserves, reforestation, fish
sanctuaries and breeding grounds, watersheds and mangroves,
national defense, school s ites and campuses including
experimental farm stations operated by public or private schools
for educational purposes, seeds and seedlings research and
pilot production centers, church sites and convents appurtenant
thereto, mosque sites and Islamic centers appurtenant thereof,
communal burial grounds and cemeteries, penal colonies and
penal farms actually worked by the inmates, government and
private research and quarantine centers; and
. ..
II. POLICIES

In the application of the aforecited provision of law, the following

guidelines shall be observed:
A. For an area in I.A to be exempted from CARP coverage, it
must be actually, directly and exclusively used and found to be
necessary for the purpose so stated.
..
C. Lands which have been classified or proclaimed, and/or
actually directly and exclusively used and found to be
necessary for parks, wildlife, forest reserves, fish sanctuaries
and breeding grounds, and watersheds and mangroves shall be
exempted from the coverage of CARP until Congress, taking
into account ecological, developmental and equity
considerations, shall have determined by law, the specific limits
of public domain, as provided for under Sec. 4(a) of RA 6657,
and a reclassification of the said areas or portions thereof as
alienable and disposable has been approved. (Emphasis
supplied)
In order to be exempt from coverage, the land must have been
classified or proclaimed and actually, directly and exclusively
used and found to be necessary for watershed purposes.[68] In
this case, at the tim e the DAR issued the Notices of Coverage
up to the time the DARAB rendered its decision on the dispute,
the subject property is yet to be officially classified or
proclaimed as a watershed and has in fact long been used for
agricultural purposes. SRRDC relies on the case of Central
Mindanao University (CMU) vs. DARAB,[69] wherein the Court
ruled that CMU is in the best position to determine what
property is found necessary for its use. SRRDC claims that it is
in the best position to determine whether its properties are
necessary for development as park and watershed area.[70]
But SRRDCs reliance on the CMU case is flawed. In the CMU
case, the subject property from the very beginning was not
alienable and disposable because Proclamation No. 476 issued
by the late President Carlos P. Garcia already reserved the
property for the use of the school. Besides, the subject property
in the CMU case was actually, directly and exclusively used and
found to be necessary for educational purposes.
In the present case, the property is agricultural and was not
actually and exclusively used for watershed purposes. As
records show, the subject property was first utilized for the
purposes of the Canlubang Sugar Estate.[71] Later, petitioner
claimed that the occupants were allowed to cultivate the area so
long as they do not plant crops being grown by the Canlubang
Sugar Estate in order to avoid confusion as to ownership
thereof.[72] Thus, based on its own assertions, it appears that it
had benefited from the fruits of the land as agricultural land.
Now, in a complete turnaround, it is claiming that the property is
part of a watershed.
Furthermore, in a belated attempt to prove that the subject
property is part of a watershed that must be environmentally
protected, SRRDC submitted before the Court a Final Report
dated February 1994 undertaken by the Ecosystems Research
and Development Bureau (ERDB) of the DENR entitled,
Environmental Assessment of the Casile and Kabanga-an River
Watersheds.[73] The study, according to SRRDC, was mad e
pursuant to a handwritten instruction issued by then President
Fidel V. Ramos. The study noted that, the continuing threat of
widespread deforestation and unwise land use practices have
resulted in the deteriorating condition of the watersheds.[74] But
the Court also notes the Memorandum for the President dated
September 1993 by then DENR Secretary Angel C. Alcala that,
after a field inspection conducted by the DENRs Regional
Executive Director and the Provincial and Community Natural
Resource Officers, it was found that:
. ..

2. Many bankal trees were found growing in the

watershed/CARP areas, including some which have been
coppiced, and that water conduits for domestic and industrial
uses were found installed at the watershed area claimed by the
Yulos. Records further show that in the 1970s, a Private Land
Timber Permit was issued to Canlubang Sugar Estate thru its
marketing arm, the Sta. Rosa Realty Devpt. Corp.
3. Resident farmers denied that they have been cutting bankal
trees and volunteered the information that one of the Estates
security guards was dismissed for cutting and transporting
bankal trees. The trees cut by the dismissed security guard
were found stacked adjacent to the Canlubang Security
Agencys headquarters.[75]
Evidently, SRRDC had a hand in the degradation of the area,
and now wants to put the entire blame on the farmerbeneficiaries. It is reasonable to conclude that SRRDC is
merely using ecological considerations to avert any disposition
of the property adverse to it.
SRRDC also objects to the identification of Amante, et al. as
beneficiaries of the subject property. Suffice it to say that under
Section 15 of R.A. No. 6657, the identification of beneficiaries is
a matter involving strictly the administrative implementation of
the CARP, a matter which is exclusively vested in the Secretary
of Agrarian Reform, through its authorized offices. Section 15
reads:
SECTION 15. Registration of Beneficiaries. The DAR in
coordination with the Barangay Agrarian Reform Committee
(BARC) as organized in this Act, shall register all agricultural
lessees, tenants and farmworkers who are qualified to be
beneficiaries of the CARP. These potential beneficiaries with
the assistance of the BARC and the DAR shall provide the
following data:
(a) names and members of their immediate farm household;
(b) owners or administrators of the lands they work on and the
length of tenurial relationship;
(c) location and area of the land they work;
(d) crops planted; and
(e) their share in the harvest or amount of rental paid or wages
received.
A copy of the registry or list of all potential CARP beneficiaries
in the barangay shall be posted in the barangay hall, school or
other public buildings in the barangay where it shall be open to
inspection by the public at all reasonable hours.
Meanwhile, Administrative Order No. 10 (Rules and Procedures
Governing the Registration of Beneficiaries), Series of 1989,
provides:
SUBJECT: I. PREFATORY STATEMENT
Pursuant to Section 15, Chapter IV, of the Comprehensive
Agrarian Reform Law of 1988, the DAR, in coordination with the
Barangay Agrarian Reform Committee (BARC), as organized
pursuant to RA 6657, shall register all agricultural lessees,
tenants and farmworkers who are qualified beneficiaries of the
CARP. This Administrative Order provides the Implementing
Rules and Procedures for the said registration.
. ..
B. Specific
1. Identify the actual and potential farmer-beneficiaries of the
CARP.

In Lercana vs. Jalandoni,[76] the Court categorically stated that:

the identification and selection of CARP beneficiaries are
matters involving strictly the administrative implementation of
the CARP, a matter exclusively cognizable by the Secretary of
the Department of Agrarian Reform, and beyond the jurisdiction
of the DARAB.[77]
The farmer-beneficiaries have already been identified in this
case. Also, the DAR Secretary has already issued Notices of
Coverage and Notices of Acquisition pertaining to the subject
property. It behooves the courts to exercise great caution in
substituting its own determination of the issue, unless there is
grave abuse of discretion committed by the administrative
agency,[78] which in these cases the Court finds none.
SRRDC questions the constitutionality of Section 22 of R.A. No.
6657, which reads in part:
SECTION 22. Qualified Beneficiaries. The lands covered by the
CARP shall be distributed as much as possible to landless
residents of the same barangay, or in the absence thereof,
landless residents of the same municipality in the following
order of priority.
(a) agricultural lessees and share tenants;
(b) regular farmworkers;
(c) seasonal farmworkers;
(d) other farmworkers;
(e) actual tillers or occupants of public lands;
(f) collectives or cooperatives of the above beneficiaries; and
(g) others directly working on the land.
. ..
SRRDC argues that Section 22 sweepingly declares landless
residents as beneficiaries of the CARP (to mean also
squatters), in violation of Article XIII, Section 4 of the
Constitution, which aims to benefit only the landless farmers
and regular farmworkers.
The Court cannot entertain such constitutional challenge. The
requirements before a litigant can challenge the constitutionality
of a law are well-delineated, viz.:
(1) The existence of an actual and appropriate case;
(2) A personal and substantial interest of the party raising the
constitutional question;
(3) The exercise of judicial review is pleaded at the earliest
opportunity; and
(4) The constitutional question is the lis mota of the case.[80]
(Emphasis supplied)
Earliest opportunity means
that the question of
unconstitutionality of the act in question should have been
immediately raised in the proceedings in the court below,[81] in
this case, the DAR Secretary. It must be pointed out that all
controversies on the implementation of the CARP fall under the
jurisdiction of the DAR, even though they raise questions that
are also legal or constitutional in nature.[82] The earliest
opportunity to raise a constitutional issue is to raise it in the
pleadings before a competent court that can resolve the same,
such that, if it is not raised in the pleadings, it cannot be
considered at the trial, and, if not considered at the trial, it
cannot be considered on appeal.[83] Records show that
SRRDC raised such constitutional challenge only before this

Court despite the fact that it had the opportunity to do so before

the DAR Secretary. The DARAB correctly refused to deal on
this issue as it is the DAR Secretary who, under the law, has
the authority to determine the beneficiaries of the CARP. This
Court will not entertain questions on the invalidity of a statute
where that issue was not specifically raised, insisted upon, and
adequately argued[84] in the DAR.
Likewise, the constitutional question raised by SRRDC is not
the very lis mota in the present case. Bas ic is the rule that every
law has in its favor the presumption of constitutionality, and to
justify its nullification, there must be a clear and unequivocal
breach of the Constitution, and not one that is doubtful,
speculative or argumentative.[85] The controversy at hand is
principally anchored on the coverage of the subject property
under the CARP, an issue that can be determined without
delving into the constitutionality of Section 22 of R.A. No. 6657.
While the identification of Amante, et al. as farmer-beneficiaries
is a corollary matter, yet, the same may be resolved by the
DAR.
SRRDC questions the DARABs jurisdiction to entertain the
question of whether the subject property is subject to CARP
coverage.
According to SRRDC, such authority is vested with the DAR
Secretary who has the exclusive prerogative to resolve matters
involving the administrative implementation of the CARP and
agrarian laws and regulations.[86]
There is no question that the power to determine whether a
property is subject to CARP coverage lies with the DAR
Secretary. Section 50 of R.A. No. 6657 provides that:
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 DARs jurisdiction under Section 50 of R.A. No. 6657 is twofold. The first is essentially executive and pertains to the
enforcement and administration of the laws, carrying them into
practical operation and enforcing their due observance, while
the second is judicial and involves the determination of rights
and obligations of the parties.[87]
Pursuant to its judicial mandate of achieving a just, expeditious
and inexpensive determination of every action or proceeding
before it,[88] the DAR adopted the DARAB Revised Rules, Rule
II (Jurisdiction of the Adjudication Board) of which provides:
SECTION 1. Primary, Original and Appellate Jurisdiction. The
Agrarian Reform Adjudication Board shall have primary
jurisdiction, both original and appellate, to determine and
adjudicate all agrarian disputes, cases, controversies, and
matters or incidents involving the implementation of the
Comprehensive Agrarian Reform Program under Republic Act
No. 6657, Executive Order Nos. 229, 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 extend over but not be
limited to the following:
a) Cases involving the rights and obligations of persons
engaged in the cultivation and use of agricultural land covered
by the Comprehensive Agrarian Reform Program (CARP) and
other agrarian laws;

b) Cases involving the valuation of land, and determination and

payment of just compensation, fixing and collection of lease
rentals, disturbance compensation, amortization payments, and
similar disputes concerning the functions of the Land Bank;
c) Cases involving the annulment or cancellation of orders or
decisions of DAR officials other than the Secretary, lease
contracts or deeds of sale or their amendments under the
administration and disposition of the DAR and LBP;
d) Cases arising from, or connected with membership or
representation in compact farms, farmers cooperatives and
other registered farmers associations or organizations, related
to land covered by the CARP and other agrarian laws;
e) Cases involving the sale, alienation, mortgage, foreclosure,
pre-emption and redemption of agricultural lands under the
coverage of the CARP or other agrarian laws;
f) Cases involving the issuance of Certificate of Land Transfer
(CLT), Certificate of Land Ownership Award (CLOA) and
Emancipation Patent (EP) and the administrative correction
thereof;
g) And such other agrarian cases, disputes, matters or
concerns referred to it by the Secretary of the DAR.
Provided, however, that matters involving strictly the
administrative implementation of the CARP and other agrarian
laws and regulations, shall be the exclusive prerogative of and
cognizable by the Secretary of the DAR. (Emphasis supplied)
On the other hand, Administrative Order No. 06-00,[89] which
provides for the Rules of Procedure for Agrarian Law
Implementation (ALI) Cases, govern the administrative function
of the DAR. Under said Rules of Procedure, the DAR Secretary
has exclusive jurisdiction over classification and identification of
landholdings for coverage under the CARP, including protests
or oppositions thereto and petitions for lifting of coverage.
Section 2 of the said Rules specifically provides, inter ali a, that:
SECTION 2. Cases Covered. - These Rules shall govern cases
falling within the exclusive jurisdiction of the DAR Secretary
which shall include the following:

(a) Classification and identification of landholdings for coverage

under the Comprehensive Agrarian Reform Program (CARP),
including protests or oppositions thereto and petitions for lifting
of coverage;
(b) Identification, qualification or disqualification of potential
farmer-beneficiaries;
(c) Subdivision surveys of lands under CARP;
(d) Issuance, recall or cancellation of Certificates of Land
Transfer (CLTs) and CARP Beneficiary Certificates (CBCs) in
cases outside the purview of Presidential Decree (PD) No. 816,
including the issuance, recall or cancellation of Emancipation
Patents (EPs) or Certificates of Land Ownership Awards
(CLOAs) not yet registered with the Register of Deeds;
(e) Exercise of the right of retention by landowner; . . .
(Emphasis supplied)
Thus, the power to determine whether a property is agricultural
and subject to CARP coverage together with the identification,
qualification or disqualification of farmer-beneficiaries lies with
the DAR Secretary.[90]
Significantly, the DAR had already determined that the
properties are subject to expropriation under the CARP and has
distributed the same to the farmer-beneficiaries.

Initially, the LBP forwarded the two Compulsory Acquisition

Claim Folders (CACF) covering the subject properties to the
DARAB for summary proceedings for the sole purpose of
determining just compensation. SRRDC then sent a letter to the
LBP claiming that the subject properties were exempt from
CARP coverage and subject of a pending petition for land
conversion. As a consequence, the DARAB asked the DAR
Secretary to first resolve the issues raised by SRRDC before it
can proceed with the land valuation proceedings. In response,
the DAR, through the Undersecretary for Operations and the
Regional Director of Region IV, submitted its report stating that:
(1) the property is subject to compulsory acquisition by virtue of
the Notice of Coverage issued on August 11, 1989, and Notice
of Acquisition issued on December 12, 1989, and that it was
subject to CARP coverage per Section IV D of DAR
Administrative Order No. 1, Series of 1990; and (2) there was
no pending petition for land conversion involving the subject
property. When SRRDC petitioned the DARAB to resolve the
issue of exemption from coverage, it was only then that the
DARAB took cognizance of said issue.[91]
As the DARAB succinctly pointed out, it was SRRDC that
initiated and invoked the DARABs jurisdiction to pass upon the
question of CARP coverage. As stated by the DARAB:
4.5.2.2. The ISSUE ON CARP COVERAGE was initiated and
incorporated in said proceeding, at the instance of petitioner
itself, by filing a petition dated March 18, 1991, Prayed therein
were that DARAB:
1. Take cognizance and assume jurisdiction over the question
of CARP coverage of the subject parcels of land;
2. Defer or hold in abeyance the proceedings for administrative
valuation of the subject properties pending determination of the
question of CARP coverage;
3. Allow respondent SRRDC to adduce evidence in support of
its position that the subject parcels of land are not covered by
the CARP beginning on the scheduled hearing date of April 4,
1991 (p.3; emphasis and underscoring supplied).
Upon persistent request of petitioner SRRDC, it was
accommodated by DARAB and a counsel of SRRDC even took
the witness stand. Its lawyers were always in attendance during
the scheduled hearings until it was time for SRRDC to present
its own evidence.
4.5.2.3. But, as earlier stated, despite the open session
proddings by DARAB for SRRDC to submit evidence and the
rescheduling for, allegedly, they are still collating the evidence,
nay, the request that it be allowed to adduce evidence, none
was adduced and this constrained public respondent to declare
SRRDC as having waived its right to present evidence. And,
after the remaining parties were heard, the hearing was formally
terminated.
. ..
4.5.3. Needless to state, the jurisdictional objection (CARP
coverage), now being raised herein was not one of the original
matters in issue. Principally, DARAB was called upon under
Section 16 of Republic Act No. 6657 to resolve a land valuation
case. But SRRDC itself insisted that DARAB should take
cognizance thereof in the same land valuation proceeding. And,
SRRDC, through its lawyers, actively participated in the
hearings conducted.
4.5.4. It was only when an adverse decision was rendered by
DARAB that the jurisdictional issue was raised in the petition for
review it filed with the Honorable Court of Appeals. It was also
only then that petitioner presented proof/evidence.
. ..

4.5.6. Public respondents (DAR/DARAB) are not unmindful of

the rule that matter of jurisdiction may be raised at any stage of
the proceeding. But for two serious considerations, the
applicability thereof in the case at bar should not be allowed.
4.5.6.1. The fact [part (municipal/industrial) and/or watershed]
upon which the jurisdictional issue interchangeably hinges were
not established during the hearing of the case. No proof was
adduced. That the matter of CARP coverage is strictly
administrative implementation of CARP and, therefore, beyond
the competence of DARAB, belonging, as it does, to the DAR
Secretary, was not even alleged, either before DARAB or the
Honorable Court of Appeals, the numerous petitions/incidents
filed notwithstanding. Be it that as it may, the records of the
case show that initially DARAB refused to take cognizance
thereof and, in fact, forwarded the issue of CARP coverage to
the office of the DAR Secretary. It was only when it was
returned to DARAB by said office that proceedings thereon
commenced pursuant to Section 1(g) of Rule II of the DARAB
Revised Rules of Procedure.
4.5.6.2. Petitioner is now estopped from assailing the
jurisdiction of DARAB. First, it expressly acknowledged the
same, in fact invoked it, when it filed its petition (Annex 4); and,
second, during the scheduled hearings, SRRDC, through its
counsel, actively participated, one of its counsel (sic) even
testifying. It may not now be allowed to impugn the jurisdiction
of public respondent [92] (Emphasis supplied)
In CA-G.R. SP No. 27234, the CA likewise found that it was
SRRDC that called upon the DARAB to determine the issue and
it, in fact, actively participated in the proceedings before it.[93] It
was SRRDCs own act of summoning the DARABs authority that
cured whatever jurisdictional defect it now raises. It is
elementary that the active participation of a party in a case
pending against him before a court or a quasi-judicial body, is
tantamount to a recognition of that courts or bodys jurisdiction
and a willingness to abide by the resolution of the case and will
bar said party from later on impugning the courts or b odys
jurisdiction.[94]
Moreover, the issue of jurisdiction was raised by SRRDC only
before the CA. It was never presented or discussed before the
DARAB for obvious reasons, i.e., it was SRRDC itself that
invoked the latters jurisdiction. As a rule, when a party adopts a
certain theory, and the case is tried and decided upon that
theory in the court below, he will not be permitted to change his
theory on appeal.[95] Points of law, theories, issues and
arguments not brought to the attention of the lower court need
not be, and ordinarily will not be, considered by a reviewing
court, as these cannot be raised for the first time at such late
stage.[96] To permit SRRDC to change its theory on appeal
would not only be unfair to Amante, et al. but would also be
offensive to the basic scales of fair play, justice and due
process.[97]
Finally, the Court notes that then DAR Secretary Benjamin T.
Leong issued a Memorandum on July 11, 1991, ordering the
opening of a trust account in favor of SRRDC. In Land Bank of
the Philippines vs. Court of Appeals, this Court struck down as
void DAR Administrative Circular No. 9, Series of 1990,
providing for the opening of trust accounts in lieu of the deposit
in cash or in bonds contemplated in Section 16 (e) of R.A. No.
6657. As a result, the DAR issued Administrative Order No. 2,
Series of 1996, converting trust accounts in the name of
landowners into deposit accounts.[98] Thus, the trust account
opened by the LBP per instructions of DAR Secretary Benjamin
T. Leong should be converted to a deposit account, to be
retroactive in application in order to rectify the error committed
by the DAR in opening a trust account and to grant the
landowners the benefits concomitant to payment in cash or LBP
bonds prior to the ruling of the Court in Land Bank of the
Philippines vs. Court of Appeals. The account shall earn a 12%

interest per annum from the time the LBP opened a trust
account up to the time said account was actually converted into
cash and LBP bonds deposit accounts.
Given the foregoing conclusions, the petition filed in G.R. No.
118838, which primarily rests on G.R. No. 112526, should be
granted.

The judgments of the trial court in the injunction case (Civil

Case No. B-2333) and the CA in CA-G.R. SP No. 38182 were
premised on SRRDCs transfer certificates of title over the
subject property. The trial court and the CA cannot be faulted
for denying the writ of injunction prayed for by Amante, et al.
since at the time the trial court rendered its decision in the
injunction case on January 20, 1992, SRRDC was still the
holder of the titles covering the subject property. The titles in its
name were cancelled and corresponding TCTs were issued in
the name of the Republic of the Philippines on February 11,
1992, and CLOAs were issued to the farm er-beneficiaries on
February 26, 1992. When Amante, et al., in their motion for
reconsideration filed in CA-G.R. SP No. 38182, brought to the
CAs attention the issuance of the CLOAs, the CA, per
Resolution dated January 19, 1995, reiterated its ruling that
whether or not the subject property is covered by the
Comprehensive Agrarian Reform Law (R.A. No. 6657) is the
subject matter of a separate case, and we cannot interfere with
the same at the present time. The CA further stated that (O)ur
present decision is, therefore, not intended to preempt any
judgment or prejudice the right of any party in the said case.[99]
It must be noted that at that juncture, the DARAB Decision and
the CA decision in CA-G.R. SP No. 27234, finding the subject
property covered by the CARP Law, is yet to be finally resolved
by this Court in G.R. No. 112526 and in fact, a temporary
restraining order was issued by the Court on December 15,
1993, enjoining the DARAB from enforcing the effects of the
CLOAs. Amante, et al. was likewise res trained from further
clearing the subject property.[100] Hence, the decision of the
trial court and the CA denying the writ of injunction was
warranted.
Nevertheless, considering that the subject property is
agricultural and may be acquired for distribution to farmerbeneficiaries identified by the DAR under the CARP, the
transfer certificates of title issued in the name of the Republic of
the Philippines and the CLOAs issued by the DAR in the names
of Amante, et al.,[101] are valid titles and therefore mus t be
upheld. By virtue thereof, Amante, et al. who have been issued
CLOAs are now the owners of the subject property.
Consequently, the decisions of the trial court in the injunction
case and the CA in CA-G.R. SP No. 38182 must now be set
aside, insofar as it orders Amante, et al. to vacate and/or
enjoins them from entering the subject property.
The Court, however, agrees with the CA that Amante, et al. is
not entitled to actual, moral and exemplary damages, as well as
attorneys fees. SRRDCs right of posses sion over the subject
property was predicated on its claim of ownership, and it cannot
be sanctioned in exercising its rights or protecting its interests
thereon. As was ruled by the CA, Amante, et al. is merely
entitled to nominal damages as a result of SRRDCs acts.[102]
All is not lost in this case. In its Memorandum dated September
29, 1993, to the DAR Secretary, the DENR manifested that:
. . . the farmers themselves could be tapped to undertake
watershed management and protection. This community-based
approach in natural resource management, is in fact, being
used in numerous watershed management projects nationwide.
Adopting the same approach in the area is deemed the best
possible solution to the case since it will not prejudice the
CLOAs issued to the farmer-beneficiaries. They should,

however, be required to undertake the necessary reforestation

and other watershed management/rehabilitation measures in
the area.

beneficiaries. The DARAB ruled against the petitioner. On appeal the

In view of the foregoing, we recommend that a watershed

management plan for the area espousing the community-based
approach be drawn-up jointly by the DAR and DENR. . . .

Issue:

CA affirmed the decision of DARAB.

Whether or not the property in question is covered by CARP despite

the fact that the entire property formed part of a watershed area prior

If SRRDC sincerely wants to preserve the property for

ecological considerations, it can be done regardless of who
owns it. After all, we are all stewards of this earth, and it rests
on all of us to tend to it.
WHEREFORE, the Second Motion for Reconsideration is
GRANTED. The Courts Decision dated October 12, 2001 in
G.R. No. 112526 is SET ASIDE and the Decision of the Court of
Appeals dated November 5, 1993 in CA-G.R. SP No. 27234 is
AFFIRMED with MODIFICATION, in that the Land Bank of the
Philippines is ordered to convert the trust account in the name
of Sta. Rosa Realty Development Corporation to a deposit
account, subject to a 12% interest per annum from the time the
LBP opened a trust account up to the time said account was
actually converted into cash and LBP bonds deposit accounts.
The temporary restraining order issued by the Court on
December 15, 1993, is LIFTED.
The petition filed by Amante, et al. in G.R. No. 118838 is
GRANTED in that Sta. Rosa Realty Development Corporation is
hereby ENJOINED from disturbing the peaceful possession of
the farmer-beneficiaries with CLOAs. The Decision of the Court
of Appeals dated June 28, 1994 in CA-G.R. CV No. 38182 is
AFFIRMED insofar as the award of nominal damages is
concerned.
The Department of Environment and Natural Resources and the
Department of Agrarian Reform, in coordination with the farmerbeneficiaries identified by the DAR, are URGED to formulate a
community-based watershed plan for the management and
rehabilitation of Barangay Casile.
SO ORDERED.

CASE DIGEST
S ta. Rosa Realty Development Corporation v CA
Facts:
Petitioner Sta. Rosa Realty Development Corporation was
the registered owner of two parcels of land with a total area of 254.6
hectares. According to petitioner, the parcels of land are watersheds,
which provide clean potable water to the Canlubang community.
Petitioner alleged that respondents usurped its rights over the property,
thereby destroying the ecosystem. Sometime in December 1985,
respondents filed a civil case with the Regional Trial Court seeking an
easement of a right of way to and from Barangay Casile. By way of
counterclaim, however, petitioner sought the ejectment of private
respondents.

After the filing of the ejectment cases, respondents

petitioned the Department of Agrarian Reform for the compulsory

acquisition of the SRRDC property under the CARP. The landholding
of SRRDC was placed under compulsory acquisition. Petitioner
objected to the compulsory acquisition of the property contending that
the area was not appropriate for agricultural purposes. The area was
rugged in terrain with slopes of 18% and above and that the occupants
of the land were squatters, who were not entitled to any land as

to the enactment of R. A. No. 6657

Held:
Watershed is one of those enumerated by CARP to be
exempt from its coverage. We cannot ignore the fact that the disputed
parcels of land form a vital part of an area that need to be protected for
watershed purposes. The protection of watersheds ensures an adequate
supply of water for future generations and the control of flashfloods
that not only damage property but cause loss of lives. Protection of
watersheds is an intergenerational responsibility that needs to be
answered now.